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https://pdfs.semanticscholar.org/ec7f/25c9208eca556b84a673af69dfdf1086f8fa.pdf
Book Review. The Transformation of American Law, 1780-1860 by Morton J. Horwitz
"More and more, courts resorted to the idea of damnum absque injuria to deny a plaintiff's claim. -By accomplishing subsidization through the legal system rather than through taxation, Horwitz maintains, the ultimate political choices were hidden from view and insulated from debate.'0 The developmental urge had captured the courts, and it was by this allegedly apolitical agency of government that the subsidy was levied."
Exemplify double-speak:
damnum absque injuria
"loss or damage without injury"
Context:
The question of the changing role of precedent is even more troubling. The notion that law is discoverable by observation and deduction, the natural law theory of adjudication, tends rather away from the rigid stare decisis principle ascribed by Horwitz to eighteenth-century courts than toward it. The previous "discovery" may well have been erroneous, and a judge's (or jury's) job is to do justice according to right and not according to precedent. Reason should govern, not example. Moreover, even if by some peculiar twist of logic colonial judges did feel the need to conform to previous case law, it is not easy to know where they might turn. There were no American reports at all, and English reports, with a few distinguished exceptions, were intermittent and frequently untrustworthy. Indeed, it is not easy to locate the idea of stare decisis in English jurisprudence before the nineteenth century.6
For whatever reasons, however, and whether as a result of or despite post-revolutionary notions regarding the nature and source of law, nineteenth-century judges did set out to transform the common law in many of its most important aspects. Not every anti-developmental rule fell, of course, for as Horwitz says the judges sometimes "regarded the weight of the received legal tradition as just too overwhelming to allow for innovation." But the law of property was certainly harnessed to the task of economic development: the "natural flow" rule of riparian rights was relaxed to allow for competitive use of water; the doctrine of prescription was partially overthrown to allow land development that produced externalities; the law of waste was relaxed to allow life tenants and other temporary occupants of land to alter their estates to make them more productive; and, perhaps most important, the law of nuisance was allowed more and more to drift away from its organizing maxim sic utere tuo ut alienum non laedas toward a new balancing test that measured the relative utility of competing land uses. Horwitz marshals impressive evidence to document these changes and he is in this respect very convincing. Furthermore, he correctly points out that in these and other ways certain injuries became noncompensable; and so it often fell out that those "landowners whose property values were impaired without compensation in effect were compelled to underwrite a portion of economic development." More and more, courts resorted to the idea of damnum absque injuria to deny a plaintiff's claim. By accomplishing subsidization through the legal system rather than through taxation, Horwitz maintains, the ultimate political choices were hidden from view and insulated from debate. The developmental urge had captured the courts, and it was by this allegedly apolitical agency of government that the subsidy was levied.
All this, as I say, is convincingly argued. There may have been some rather extensive redistribution going on, and if so, the developmentally minded were, partly at least, the benefited parties. Not all developers would win, for some would be inefficient even with a subsidy; but still, in general, developers as a class, or, as Horwitz has it, the "dynamic and growing forces in American society," the "active and powerful elements" would have been the chief beneficiaries of the transformation. Yet the losers are more difficult to identify. Horwitz calls them "the weak and relatively powerless" 13 and "the weakest and least active elements in the population." 14 There is a tautological sense in which a person who is victimized this way is necessarily "weak" and "powerless": if he were otherwise he would have acted to prevent it. But there is another tautological sense in which victims are neither weak nor powerless: in order to be victimized, one needs to be propertied. A substantial landowner who finds himself powerless to enjoin an injurious activity because of a transformation in nuisance doctrine may be very considerably damaged, but it seems somewhat curious to describe him, before the fact, as "weak" or "powerless." Indeed, the "weakest" and most "powerless" of the society are the dispossessed; and they, by definition, having nothing, have nothing to lose. Still, it is true that the non-propertied classes might have lost something during this transforming period, for, as Horwitz shows, the general compensation principle of the eighteenth century gave way to a predominantly negligence-oriented tort law in the nineteenth. To the extent that the right to be free from even non-negligently caused injury is a property right, everyone, even the dispossessed, may have lost something to the active elements of American society. Whether liability rules might be property became much debated, of course, during the heyday of substantive due process.
Still there is a larger point to be made here, and that is that while the proproductive law of the nineteenth century may have robbed some of their property in the more usual sense, and everyone of their common-law liability rules, economic development may have so benefited society in general that the result to even the unpropertied was a net increase in utilitarian terms. We are not dealing here with a zero-sum game, and the subsidy may possibly have amounted merely to compensation to the entrepreneurial class for benefits conferred and otherwise uncollectable. In other words, the transformation in liability rules can be seen as a kind of hidden, general unjust enrichment remedy, and the resulting social structure, even with the "subsidy," may have been very nearly pareto superior. It was almost certainly Kaldor-Hicks efficient. The conclusion that nineteenth-century legal changes actively promoted a "legal redistribution of wealth" is probably correct to some degree; but it is a real question whether the redistribution was large and who the losers were. Take the concrete case of an ordinary nonpropertied working person, say, a railroad employee. He may be benefited by lower costs of goods because of lower transportation costs. Moreover, the loss to him represented by a changed liability rule may have been more particularly compensated for by higher wages than would otherwise be forthcoming.
6 J. DAwsoN, TrS Acrs OF =t LAW 83-90 (1968). This is a very complicated matter and deserves serious investigation, but a brief outline of the difficulty as I see it can be given here. As Horwitz shows, very little control over the jury was exerted by eighteenth-century judges. Now jury control devices are necessary for generating legal opinions by judges whether written or not; and opinions are necessary for a system of stare decisis in the usual sense. Of course a system of precedent could be based on custom. But if jury control techniques were rare before the revolution, juries, not judges, would be responsible for keeping the custom pure. A proper analysis of this difficulty will require separate treatment of procedural and substantive law, and, within the substantive division, distinct consideration of criminal and civil law. Moreover, separate consideration of the law of real property would seem to be necessary because special verdicts were common in that area of the law and uncommon elsewhere.”
III.
One of the most striking theses of the book is that eighteenth and nineteenth-century contract law were fundamentally different, the one being based on flexible regulatory notions of substantive justice and just price, the other on hard-line and literal enforcement of bargains precisely as made. Horwitz argues, for instance, that in the eighteenth century there was at law and equity a substantive theory of consideration, that is, that adequacy would be examined into, and necessary adjustments made by juries, if the agreed price seemed in some manner unfair.'8 That this was the rule in equity has been for some time recognized; but the existence of an identical rule at law, for which Horwitz produces much evidence, is very surprising indeed. But Horwitz's theory is not free from difficulty."
"Pareto Efficient. ... An outcome of a game is Pareto efficient if there is no other outcome that makes every player at least as well off and at least one player strictly better off. That is, a Pareto Optimal outcome cannot be improved upon without hurting at least one player."
"Kaldor-Hicks Efficiency. Pareto efficiency occurs where at least one party benefits and nobody is made worse off. Kaldor Hicks states that a decision can be more efficient – as long as there is a net gain to society – enabling any potential losers to be compensated from the net gain."