Foundations of Law: Week 6 Key Principle of Vow/Promise • God fulfills His promises, and as creatures made in His image, we should do the same. – Genesis 1:26. “Let Us make man in Our image, according to Our likeness;” – Numbers 23:19. God is not a man that He should lie, nor a son of man that He should repent. Has He said and will He not do, or has He spoken and will He not make it good? Key Issue • Contract law, like all law, flows from God. This chapter asks the question, “to what extent is man held to his promises?” • The Bible provides few releases for a person who makes a promise. Modern laws have provided more justifications for breaking one’s promise. We will assess these modern doctrines to see if they comport with the Laws of Nature and of Nature’s God. Ogden v. Saunders • SCOTUS by a vote of 4-3 upheld a NY law that required all future contracts to be subject to state bankruptcy law. • John Marshall dissented b/c he believed that the right to contract was established by God and that the government could not undo a contract through a bankruptcy law. Source of Contract Law • The source of contract is God. • Contract law is not the creature of society b/c it existed before society. • The obligation/right of contract comes from LONANG. • It is an unalienable right bestowed upon us by God. • Accordingly, while the state may enforce contracts, it may not impair them. Sanctity of Promise • Numbers 30:2. “This is the thing which the Lord has commanded: If a man makes a vow to the Lord, or swears an oath to bind himself by some agreement, he shall not break his word; he shall do according to all that proceeds out of his mouth. • Matthew 5:37. “But let your ‘Yes’ be ‘Yes,’ and your ‘No,’ ‘No.’ For whatever is more than these is from the evil one.” God is a Promisekeeper • God fulfills His promises, and as creatures made in His image, we should do the same. – Genesis 1:26. “Let Us make man in Our image, according to Our likeness;” – Numbers 23:19. God is not a man that He should lie, nor a son of man that He should repent. Has He said and will He not do, or has He spoken and will He not make it good? Fletcher v. Peck • GA legislature granted 35 million acres of land to speculators for low price – January 1795: GA  Gunn – August 1795: Gunn  Greenleaf – September 1795: Greenleaf  Prime • February 13, 1796:GA legislature repeals initial grant – February 27, 1796: Prime  Phelps – 1800: Phelps  Peck – 1803: Peck  Fletcher • Fletcher demands his money back, arguing that Peck cannot convey good title Fletcher v. Peck (cont’d) • The Court ruled that Georgia could not repeal its grant of the land because it was a contract. • Georgia is held to its contracts the same way a person is held to his contracts. Hypo 1 • Q1: So does a law permitting a debtor to be absolved from His debts “impair the obligation of con ...

1. Foundations of Law: Week 6
Key Principle of Vow/Promise
• God fulfills His promises, and as creatures
made in His image, we should do the same.
– Genesis 1:26. “Let Us make man in Our image,
according to Our likeness;”
– Numbers 23:19. God is not a man that He should
lie, nor a son of man that He should repent. Has
He said and will He not do, or has He spoken and
will He not make it good?
Key Issue
• Contract law, like all law, flows from God. This
chapter asks the question, “to what extent is
man held to his promises?”
• The Bible provides few releases for a person
who makes a promise. Modern laws have
provided more justifications for breaking one’s
promise. We will assess these modern
doctrines to see if they comport with the Laws

2. of Nature and of Nature’s God.
Ogden v. Saunders
• SCOTUS by a vote of 4-3 upheld a NY law that
required all future contracts to be subject to
state bankruptcy law.
• John Marshall dissented b/c he believed that
the right to contract was established by God
and that the government could not undo a
contract through a bankruptcy law.
Source of Contract Law
• The source of contract is God.
• Contract law is not the creature of society b/c
it existed before society.
• The obligation/right of contract comes from
LONANG.
• It is an unalienable right bestowed upon us by
God.
• Accordingly, while the state may enforce
contracts, it may not impair them.

3. Sanctity of Promise
• Numbers 30:2. “This is the thing which the
Lord has commanded: If a man makes a vow
to the Lord, or swears an oath to bind himself
by some agreement, he shall not break his
word; he shall do according to all that
proceeds out of his mouth.
• Matthew 5:37. “But let your ‘Yes’ be ‘Yes,’ and
your ‘No,’ ‘No.’ For whatever is more than
these is from the evil one.”
God is a Promisekeeper
• God fulfills His promises, and as creatures
made in His image, we should do the same.
– Genesis 1:26. “Let Us make man in Our image,
according to Our likeness;”
– Numbers 23:19. God is not a man that He should
lie, nor a son of man that He should repent. Has
He said and will He not do, or has He spoken and
will He not make it good?
Fletcher v. Peck
• GA legislature granted 35 million acres of land to

4. speculators for low price
–
–
–
• February 13, 1796:GA legislature repeals initial grant
–
–
–
• Fletcher demands his money back, arguing that Peck
cannot convey good title
Fletcher v. Peck (cont’d)
• The Court ruled that Georgia could not repeal
its grant of the land because it was a contract.
• Georgia is held to its contracts the same way a
person is held to his contracts.
Hypo 1
• Q1: So does a law permitting a debtor to
be absolved from His debts “impair the
obligation of contracts” if contracts are a right
created by civil society?
• Q2: Does a law permitting a debtor to be
absolved from his debts “impair the obligation

5. of contracts” found in the common law and
the LONANG?
Presenter
Presentation Notes
A: If the obligation of contracts is merely a civil right (a right
created by society) then society can change modify that right by
releasing the debtor. If, however, the obligation of contracts is a
requirement of LONANG, then society cannot change it to
release a debtor.
Note: This issue is a bit complex b/c while God clearly
commands that people fulfill their promises, he did order Israel
to release all debtors from their debts every 7 years.
Release
• Deuteronomy 15:1-4. ““At the end of every
seven years you shall grant a release of debts.
2 And this is the form of the release: Every
creditor who has lent anything to his neighbor
shall release it; he shall not require it of his
neighbor or his brother, because it is called
the LORD’s release. 3 Of a foreigner you may
require it; but you shall give up your claim to
what is owed by your brother, 4 except when
there may be no poor among you;.”
Grounds for release from
promise/contract?
• Does fraud release someone from a contract?

6. – Does not seem so according to the Bible. See Israel’s treaty
with
Gibeonites. Joshua 9:1-19. Israel was held to the treaty even
though the Gibeonites tricked them into making the treaty.
– Modern law and common law release one from a promise
induced by fraud
• Unlawful purpose?
– Yes. Exodus 23:1 and other passages condemn entering into
agreements to do unlawful actions.
– This is one of the few clear Biblical grounds for excusing
oneself
from a contract. If someone promises to do something illegal,
they can recant that promise.
– Modern law and common law release one from promises to
perform unlawful actions
Hypo 1
• Q: Are bankruptcy laws (which permit a debtor to be
absolved from his debts) consistent with LONANG?
• Consider the debt release in Mosaic law: Deuteronomy
15:1-4. “At the end of every seven years you shall grant
a release of debts. 2 And this is the form of the release:
Every creditor who has lent anything to his neighbor
shall release it; he shall not require it of his neighbor or
his brother, because it is called the LORD’s release. 3 Of a
foreigner you may require it; but you shall give up your

7. claim to what is owed by your brother, 4 except when
there may be no poor among you;.”
Impossibility in Common Law
• General Rule:
– Party must perform or pay damages, even if
performance is impossible.
• Exceptions
– Contract must be absolute; parties can expressly or
impliedly agree to certain conditions that might
excuse performance
– Contracts in which performance depends on the
continued existence of a given person or thing, a
condition is implied that the impossibility of
performance arising from the perishing of the person
or thing shall excuse the performance. (215)
Impossibility: Modern Rule
• Courts will release one from a contract for
impossibility or impracticability
• “a thing is impossible in legal contemplation
when it is not practicable; and a thing is
impracticable when it can only be done at an
excessive and unreasonable cost.”

8. Impossibility in Bible/LONANG?
• Impossibility does not appear to be a justification for
release from a contract:
– Psalm 15:4. The righteous person “swears to his own hurt and
does not change.”
– Proverbs 22:26-28. Do not be a surety for debts “if you have
nothing with which to pay, Why should he take away your bed
from under you?”
– Ecclesiastes 5:5. Better not to vow than to vow and not pay.
– Matthew 18:24, 34. [Parable of the Unforgiving Servant]
Servant
owed 10,000 talents (insurmountable amount). Initially
forgiven,
but then when he failed to forgive another, he was thrown in
prison until “he should pay all that was due to him.”
Unconscionability
• Doctrine
– Courts will release one from a contract where that
contract is “unconscionable”
– Whether in light of general commercial
background . . . the clauses are so one-sided as to
be unconscionable under the circumstances at the
time of the making of the contract.

9. • Purposes
– Prevent oppression and unfair surprise
Unconscionability and LONANG
• Genesis 25:29-34
• 29 Now Jacob cooked a stew; and Esau came in from the
field, and he was weary. 30 And Esau said to Jacob, “Please
feed me with that same red stew, for I am weary.”
Therefore his name was called Edom.
• 31 But Jacob said, “Sell me your birthright as of this day.”
• 32 And Esau said, “Look, I am about to die; so what is this
birthright to me?”
• 33 Then Jacob said, “Swear to me as of this day.”
• So he swore to him, and sold his birthright to Jacob. 34 And
Jacob gave Esau bread and stew of lentils; then he ate and
drank, arose, and went his way. Thus Esau despised his
birthright.
Unconscionability and LONANG cont’d
• Hebrews 12:16-17. “lest there be any
fornicator or profane person like Esau, who for
one morsel of food sold his birthright. For you
know that afterward, when he wanted to
inherit the blessing, he was rejected, for he
found no place for repentance, though he

10. sought it diligently with tears.”
Do minimum wage laws violate
LONANG?
• Deuteronomy 24: 14-15. “You shall not oppress a hired
servant who is
poor and needy, whether one of your brethren or one of the
aliens who is
in your land within your gates. Each day you shall give him his
wages, and
not let the sun go down on it, for he is poor and has set his heart
on it; lest
he cry out against you to the Lord, and it be sin to you.
• Jeremiah 22:13. “Woe to him who builds his house by
unrighteousness
And his chambers by injustice, Who uses his neighbor’s service
without
wages
And gives him nothing for his work,”
• James 5:4. “Indeed the wages of the laborers who mowed your
fields,
which you kept back by fraud, cry out; and the cries of the
reapers have
reached the ears of the Lord of Sabaoth.”
Presenter
Presentation Notes
Minimum wage laws raise an interesting question. The Bible is
concerned with justice. However, when the state sets a
minimum wage, it is imposing a standard upon a contract made

11. between two consenting parties. The Bible seems to permit the
parties to make their own promises. However, as the above
verses show, the unjust employer will be held accountable by
God for ripping off his employees.
Minimum Wage Laws Cont’d
• Matthew 20:1-16. “But he answered one of
them and said, ‘Friend, I am doing you no
wrong. Did you not agree with me for a
denarius? Take what is yours and go your way.
I wish to give to this last man the same as to
you. Is it not lawful for me to do what I wish
with my own things? Or is your eye evil
because I am good?”
Jones v. Star Credit Corp.
• Welfare recipients purchased $300 freezer for
$900 ($1234.80 with sales tax, credit charges,
and insurance)
• Recipients fell behind on payments after
paying $619.88.
Jones v. Star Credit Corp. cont’d
• Rule: Court can undo an unconscionable

12. contract. Court can consider the resources of
the parties, and the mathematical disparity
b/t the charged price for the item and its
actual value.
• Held: The contract for the purchase of the
freezer was unconscionable.
Biblical Remedies for Problem of
Unconscionability
• Eccl. 5:5. Better not to vow than to vow and
not fulfill it.
• Luke 6:34-35. lend money to the poor without
expecting payment.
• Proverbs 14:31. Those who oppress the poor
insult their Maker.
• Proverbs 22:22. Do not oppress the poor, “for
the Lord will plead their cause.”
Unconscionability Conclusion
• As evidenced by the story of Jacob and Esau,
LONANG does not seem to provide an exception
for unconscionability. When one makes a
promise, he is bound to it, not matter how
unwise that promise is. However, in Israel, the
financial implications of an unwise contract were
mitigated by the seven year release. For example,

13. if one took out a loan to invest in a business that
failed, the debtor would be released from the
remaining balance on the loan in the seventh
year.
Impracticability
• The doctrine of Impracticability releases one from
his contract when the thing becomes
“impracticable” = when it can only be done at an
excessive and unreasonable cost.
• Is this doctrine consistent with LONANG?
– Appears the answers is no.
– Psalm 15:4. A righteous man swears to his own hurt
– Matthew 18:24, 34. Unforgiving Servant held
accountable for his insurmountable debt
LONANG Framework for Assessing the
Validity of Laws that Regulate
Contracts
1. Does law interfere with the duty to fulfill
one’s promise/the right to contract?
2. If it does, the law is presumed to violate the
rule of contracts.
3. But can the law be justified on some other
ground in the Scriptures? [Does law fall into

14. one of the few Biblical exceptions that
release one from his promise?]
Do minimum wage laws violate
LONANG?
• Deuteronomy 24:14-15. “You shall not oppress a hired servant
who
is poor and needy, whether one of your brethren or one of the
aliens who is in your land within your gates. Each day you shall
give
him his wages, and not let the sun go down on it, for he is poor
and
has set his heart on it; lest he cry out against you to the Lord,
and it
be sin to you.
• Jeremiah 22:13. “Woe to him who builds his house by
unrighteousness
And his chambers by injustice, Who uses his neighbor’s service
without wages and gives him nothing for his work,”
• James 5:4. “Indeed the wages of the laborers who mow ed your
fields, which you kept back by fraud, cry out; and the cries of
the
reapers have reached the ears of the Lord of Sabaoth.”
Minimum Wage Laws Cont’d
• Matthew 20:1-16. “But he answered one of
them and said, ‘Friend, I am doing you no
wrong. Did you not agree with me for a

15. denarius? Take what is yours and go your way.
I wish to give to this last man the same as to
you. Is it not lawful for me to do what I wish
with my own things? Or is your eye evil
because I am good?”
Allgeyer v. Louisiana
• LA law makes it unlawful for any person to
procure insurance within the state from any
insurance company that has not first complied
with LA laws with respect to the doing of the
insurance business there.
• DEFs, in the cotton export business, applied to NY
insurance company that had not complied with
LA insurance laws.
• DEFs fined for violating statute.
Foundations of Law: Week 6Key Principle of Vow/PromiseKey
IssueOgden v. SaundersSource of Contract LawSanctity of
PromiseGod is a PromisekeeperFletcher v. PeckFletcher v. Peck
(cont’d)Hypo 1ReleaseGrounds for release from
promise/contract?Hypo 1Impossibility in Common
LawImpossibility: Modern RuleImpossibility in
Bible/LONANG?UnconscionabilityUnconscionability and
LONANGUnconscionability and LONANG cont’dDo minimum
wage laws violate LONANG?Minimum Wage Laws Cont’dJones
v. Star Credit Corp.Jones v. Star Credit Corp. cont’dBiblical
Remedies for Problem of UnconscionabilityUnconscionability
ConclusionImpracticabilityLONANG Framework for Assessing
the Validity of Laws that Regulate ContractsDo minimum wage

16. laws violate LONANG?Minimum Wage Laws Cont’dAllgeyer v.
Louisiana