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Law Merchant aka Mercantile Law

Posted: Sun Jan 08, 2017 12:49 pm
by notmartha
Compare to Admiralty


KJV References

“Merchant” in Old Testament
Merchant in Old Testament.pdf
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“Merchant” in New Testament

Emporos, Greek Strong's #1713, is found 5 times in the New Testament. It is translated as
merchant in the following verses:
Matthew 13:45 - Again, the kingdom of heaven is like unto a merchant man, seeking goodly pearls:
Revelation 18:3 - For all nations have drunk of the wine of the wrath of her fornication, and the kings of the earth have committed fornication with her, and the merchants of the earth are waxed rich through the abundance of her delicacies.
Revelation 18:11 - And the merchants of the earth shall weep and mourn over her; for no man buyeth their merchandise any more:
Revelation 18:15 - The merchants of these things, which were made rich by her, shall stand afar off for the fear of her torment, weeping and wailing,
Revelation 18:23 - And the light of a candle shall shine no more at all in thee; and the voice of the bridegroom and of the bride shall be heard no more at all in thee: for thy merchants were the great men of the earth; for by thy sorceries were all nations deceived.

Easton's Bible Dictionary, Matthew George Easton, 1897
The Hebrew word so rendered is from a root meaning "to travel about," "to migrate," and hence "a traveller." In the East, in ancient times, merchants travelled about with their merchandise from place to place (Gen 37:25; Job 6:18), and carried on their trade mainly by bartering (Gen 37:28; Gen 39:1). After the Hebrews became settled in Palestine they began to engage in commercial pursuits, which gradually expanded (Gen 49:13; Deut 33:18; Jdg 5:17), till in the time of Solomon they are found in the chief marts of the world (1Ki 9:26; 1Ki 10:11, 26, 28; 1Ki 22:48; 2Ch 1:16; 2Ch 9:10, 21). After Solomon's time their trade with foreign nations began to decline. After the Exile it again expanded into wider foreign relations, because now the Jews were scattered in many lands.
For Further Reading:

"The Merchants of the Earth", Ben Williams ... _Earth.pdf

The following articles are from The Christian Jural Society News
Debt and Mortgage and the Law Merchant.pdf
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History of the Law Merchant.pdf
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Scripture and the Law Merchant Parts 1 2 3.pdf
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What is Law Merchant.PDF
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Commentaries on the Laws of England in Four Books, vol. 1 Sir William Blackstone, 1753
V. Another light, in which the laws of England consider the king with regard to domestic concerns, is as the arbiter of commerce. By commerce I at present mean domestic commerce only. It would lead me into too large a field, if I were to attempt to enter upon the nature of foreign trade, its privileges, regulations, and restrictions; and would be also quite beside the purpose of these commentaries, which are confined to the laws of England; whereas no municipal laws can be sufficient to order and determine the very extensive and complicated affairs of traffic and merchandise; neither can they have a proper authority for this purpose. For, as these are transactions carried on between subjects of independent states, the municipal laws of one will not be regarded by the other. For which reason the affairs of commerce are regulated by a law of their own, called the law merchant, or lex mercatoria, which all nations agree in and take notice of. And in particular it is held to be part of the law of England, which decides the causes of merchants by the general rules which obtain in all commercial countries; and that often even in matters relating to domestic trade, as, for instance, with regard to the drawing, the acceptance, and the transfer of inland bills of exchange.26

[26 ] “Congress have power to regulate commerce with foreign nations, and among the several States, and with the Indian tribes.” Const. U. S. art. 1, s. 8. Whether this is or is not a power exclusive of the several States, is a question which does not yet appear to be fully settled. The Passenger cases, 7 Howard, S. C. Rep. 283.—Sharswood.
To this head may most properly be referred a particular system of customs used only among one set of the king’s subjects, called the custom of merchants or lex mercatoria: which, however different from the general rules of the common law, is yet ingrafted into it, and made a part of it; being allowed, for the benefit of trade, to be of the utmost validity in all commercial transactions: for it is a maxim of law, that “cuilibet in sua arte credendum est.”15

[15]The lex mercatoria, or the custom of merchants, like the lex et consuetude parliamenti. describes only a great division of the law of England. The laws relating to bills of exchange, insurance, and all mercantile contracts, are as much the general law of the land as the laws relating to marriage or murder. But the expression has very unfortunately led merchants to suppose, that all their crude and new-fangled fashions and devices immediately become the law of the land; a notion which, perhaps, has been too much encouraged by our courts. Merchants ought to take their law from the courts, and not the courts from merchants; and when the law is found inconvenient for the purposes of extended commerce, application ought to be made to parliament for redress. Merchants ought to be considered in no higher degree their own legislators or judges upon subjects of commerce, than farmers or sportsmen in questions upon leases or the gamelaws. For the position of Lord Coke ought never to be forgotten:—“That the common law has no controller in any part of it, but the high court of parliament; and if it be not abrogated or altered by parliament, it remains still, as Littleton saith.” (Co. Litt. 115.) This is agreeable to the opinion of Mr. Justice Foster, who maintains that “the custom of merchants is the general law of the kingdom, and therefore ought not to be left to a jury after it has been settled by judicial determinations.” 2 Bur. 1226.—Christian.
That large branch of law which relates to the transactions of commerce is now a part of the municipal law of the country, whether it be found in statutes or codes, or adopted by general reasoning and the authority of the opinions of jurists and civilians. It is taken notice of judicially by the courts, and is not decided by the jury, as a mere custom would be. Mercantile usage is often appealed to in order to explain doubtful words in a contract, but never to contradict or vary any settled rule or principle of law. The sources of the mercantile law are, mainly, the Roman law, the various codes of modern European nations, and the writings of general jurists; but it is not to be denied that these questions were originally treated in England as matters of custom, and were referred to the decision of a jury of merchants. After one point of such custom was ascertained by the verdict of a jury, it was not considered proper to submit the same question to another jury, but it was thereafter judicially noticed and applied by the court. “Before the time of Lord Mansfield,” says Mr. J. Buller, “we find that, in courts of law, all the evidence in mercantile cases was thrown together: they were left generally to a jury, and they produced no established principle. From that time, we all know, the great study has been to find out some certain general principles, which shall be known to all mankind, not only to rule the particular case then under consideration, but to serve as a guide for the future. Most of us have heard those principles stated, reasoned upon, enlarged, and explained, till we have been lost in admiration of the strength and stretch of the human understanding. And I should be very sorry to find myself under a necessity of differing from any case, which has been decided by Lord Mansfield, who may be truly said to be the founder of the commercial law of this country.” (2 T. R. 73.) “The law merchant,” said Lord Denman, “forms a branch of the law of England; and those customs which have been universally and notoriously prevalent amongst merchants, and have been found by experience to be of public use, have been adopted as a part of it, upon a principle of convenience, and for the benefit of trade and commerce; and, when so adopted, it is unnecessary to plead and prove them. They are binding on all without proof. Accordingly, we find that usages affecting bills of exchange and bills of lading are taken notice of judicially.” 6 Man. & Gr. 665.—Sharswood.
Commentaries on the Laws of England in Four Books, vol. 2 Sir William Blackstone, 1753
Thus, in mercantile questions, such as bills of exchange and the like; in all marine causes, relating to freight, average, demurrage, insurances, bottomry, and others of a similar nature; the law-merchant, which is a branch of the law of nations, is regularly and constantly adhered to. So too in all disputes relating to prizes, to shipwrecks, to hostages and ransom-bills, there is no other rule of decision but this great universal law, collected from history and usage, and such writers of all nations and languages as are generally approved and allowed of.
Cyclopaedia of Political Science, Political Economy, and of the Political History of the United States, vol. 2, John Joseph Lalor, 1881
The theory of the balance of trade and the consequences which were drawn therefrom constitute what is called the mercantile system, because the whole of this system tends to consider foreign commerce as the most productive branch of a nation's labor. It is supposed that a nation can sell more than it buys, in a way to ruin neighboring nations by absorbing their precious metals by the greatest possible exportation and the least possible importation. This false theory still prevails in the minds of the masses, and still serves as a rule for many administrations and governments; it forms the basis of the economic ideas of all the writers of the eighteenth century, who did not belong to the physiocratic school or to that of Adam Smith; it is still appealed to in our days by statesmen, and by all those who, by conviction or for financial considerations, defend prohibition, high tariffs and custom impediments.

—We have not to detail here, still less to refute, all the consequences of this fundamental error, which would necessitate a full course in political economy, and which would lead us to repeat what is already found in many articles of this Cyclopædia. We will limit ourselves to saying that the mercantile system is in opposition to the true notion of money and of production, to the nature of markets and the mechanism of the operations of commerce, and we will refer the reader more particularly to the articles, BALANCE OF TRADE, COMMERCE, EXCHANGE, OUTLET, MONEY, PRODUCTION OF WEALTH, EXPORTS AND IMPORTS.

—All sciences have begun in error; and the mercantile error is found in antiquity. It is plain from a passage in Cicero, that the exportation of precious metals was often prohibited under the republic, and this prohibition was often renewed, although very uselessly, by the emperors. There is perhaps no state in modern Europe which has not formally interdicted the exportation of gold and silver. This exportation was, it is said, prohibited by the English laws before the conquest, and different statutes having the same purpose were passed at that time. One of these statutes (3 Henry VIII., chap. i.), approved in 1512, declared that any person who transported metallic specie, plate or jewels, to a foreign country, if it was discovered, would be liable to a confiscation equivalent to double the value of the merchandise transported.

—In 1848 when Rossi became minister of the pope, one of his first cares was to repeal the legal provisions which forbade the exportation of coin from the Roman states. About the same time, and a few days after the revolution of February in France, the commissary of the department of the Rhone opposed, by a decree, the exportation of coin from that department!

—It is known that commerce, during the fifteenth and sixteenth centuries, developed rapidly, on account of the direct relations of Europe with India by the cape of Good Hope, and the force of
circumstances brought about the substitution of a more ingenious and less barbarous system for the gross system of the absolute prohibition of the exportation of coin. Indeed the exportation of gold and silver money by India was advantageous and was practiced notably by the East India company. This company was accused on this point of ruining the kingdom, by taking out of the country its gold and silver, but its defenders, Thomas Mun among others, claimed that this exportation was advantageous, because the commodities brought from India were chiefly re-exported into other countries, from which was received a larger quantity of coin than that required in the first place for the payment of these commodities in the east.

—It is from this time that the first theoretical essays on economic and commercial questions date. Mun wrote in 1635 or 1640; after him came, in England, Josiah Child, Dr. Davenant, the authors of the "English Merchant," and J. Steuart; in France, Melon and Forbonnais; in Italy, Genoiesi, who were, in the eighteenth century, the most distinguished writers, who defended, with more or less extensive restrictions, the principles of the mercantile system.

—The analyses of the physiocrats, and, later, those of Adam Smith, completely refuted this false idea, which all the treatises on political economy place among scientific heresies; but upon this point, we repeat, practice is about three-quarters of a century behind theory. The point of departure of this theory rests in this fact, that, since ancient times, money had principally consisted of gold and silver specie. From this fact it was concluded that the possession of money exclusively constituted wealth; the use of money for a long time prevented the perception of the true nature of purchase and sale, that is to say, of exchange, and confounded wealth with the instrument of exchange and the measure of this wealth. The consequences of this error have been formidable for humanity. They have, in fact, led men to misunderstand the freedom of labor, the advantages of the division of employments among nations; led them to create at the frontiers customs barriers to protect certain branches of work, but which hurt all; to direct most industries into unnatural ways; to give to governments a surveillance which they should not be allowed to exercise; to create a barbarous legislation, and to cast discord among nations. "It is no exaggeration," says Storch, "to affirm that very few political errors have produced more disasters than the mercantile system. Armed with power, it has imposed ordinances and prohibitions where it should have protected. The method of making regulations, which it has inspired, has been the cause of vexations of a thousand kinds to industry, to turn it from its natural paths. The mercantile system has persuaded each nation that the well-being of neighboring nations was incompatible with its own; hence was born that reciprocal desire to injure and impoverish each other, and with it that spirit of commercial rivalry which has been the immediate or remote cause of the greater part of modern wars. It is the mercantile system which has driven nations to employ force or cunning to extort from the weakness or ignorance of rival nations treaties of commerce which have been of no real advantage for themselves. It is this system which has presided over the formation of colonies, for the purpose of giving to the mother country the exclusive enjoyment of their commerce, and to force them to have recourse only to the markets of the mother country. Where this system has produced the least evil, it has retarded the progress of national prosperity; everywhere, besides, it has caused torrents of blood to flow; it has depopulated and ruined many countries, to which it might have been supposed it would have furnished in the highest degree power and wealth."


Webster’s Dictionary of the English Language, 1828
MER'CHANT, noun [Latin mercor, to buy.]
1. A man who trafficks or carries on trade with foreign countries, or who exports and imports goods and sells them by wholesale.
2. In popular usage, any trader, or one who deals in the purchase and sale of goods.
3. A ship in trade. [Not used.]
MER'CHANT, verb intransitive To trade. [Not in use.]
Bouvier’s Law Dictionary, 1856

A system of customs acknowledged and taken notice of by all commercial nations; and those customs constitute a part of the general law of the land; and being a part of that law their existence cannot be proved by witnesses, but the judges are bound to take notice of them ex officio. See Beawes' Lex Mercatoria Rediviva; Caines' Lex Mercatoria Americana; Com. Dig. Merchant, D; Chit. Comm. Law; Pardess. Droit Commercial; Collection des Lois Maritimes antérieure au dix hutième siècle, par Dupin; Capmany, Costumbres Maritimas; II Consolato del Mare; Us et Coutumes de la Mer; Piantandia, Della Giurisprudenze Maritina Commerciale, Antica e Moderna; Valin, Commentaire sur l'Ordonnance de la Marine, du Mois d'Août, 1681; Boulay Paty, Dr. Comm.; Boucher, Institutions au Droit Maritime.


By this term is understood all those things which merchants sell either wholesale or retail, as dry goods, hardware, groceries, drugs, &c. It is usually applied to personal chattels only, and to those which are not required for food or immediate support, but such as remain after having been used or which are used only by a slow consumption. Vide Pardess. n. 8; Dig. 13, 3, 1; Id. 19, 4, 1; Id. 50, 16, 66. 8 Pet. 277; 2 Story, R. 16, 53, 54; 6 Wend. 335.


1. One whose business it is to buy and sell merchandise; this applies to all persons who habitually trade in merchandise. 1 Watts & S. 469; 2 Salk. 445.

2. In another sense, it signifies a person who owns ships, and trades, by means of them, with foreign nations, or with the different States of the United States; these are known by the name of shipping merchants. Com. Dig. Merchant, A; Dyer, R. 279 b; Bac. Ab. h. t.

3. According to an old authority, there are four species of merchants, namely, merchant adventurers, merchant dormant, merchant travellers, and merchant residents. 2 Brownl. 99. Vide, generally, 9 Salk. R. 445; Bac. Ab. h. t.; Com. Dig. h. t.; 1 Bl. Com. 75, 260; 1 Pard. Dr. Com. n. 78


A ship or vessel employed in a merchant's service. This term is used in opposition to a ship of war.


1. In the statute of limitations, 21 Jac. 1. c. 16, there is an exception which has been copied in the acts of the legislatures of a number of the States, that its provisions shall not apply to such accounts as concern trade and merchandise between merchant and merchant, their factors or servants.

2. This exception, it has been holden, applies to actions of assumpsit as well as to actions of account. 5 Cranch, 15. But to bring a case within the exception, there must be an account, and that account open and current, and it must concern trade. 12 Pet. 300. See 6 Pet. 151; 5 Mason, R. 505; Bac. Ab. Limitation of Actions, E 3; and article Limitation.
Black’s Law Dictionary, 1st Edition, 1891
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A Dictionary of Law, William C. Anderson, 1893
Custom of merchants:

A system of customs, originating among merchants, and allowed for the benefit of trade as part of the common law.

Law-merchant; law of merchants:
The rules applicable to commercial paper were transplanted into the common law from the law merchant. They had their origin in the customs and course of business of merchants and bankers, and are now recognized by the courts because they are demanded by the wants and conveniences of the mercantile world.
The Century Dictionary, an Encyclopedic Lexicon of the English Language, 1895
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Blacks Law Dictionary, 5th Edition, 1979

One who is engaged in the purchase ans sale of goods; a trafficker; a retailer; a trader. Term commonly refers to person who purchases goods at wholesale for resale at retail; i.e. person who operates a retail business (retailer).

(Includes definition from U.C.C. §2-104(1))

A man who traffics or carries on trade with foreign countries, or who exports and imports goods and sells them by wholesale. Merchants of this description are commonly known by the name of “shipping merchants.”

Law merchant. See Mercantile Law

Mercantile Law

An expression substantially equivalent to commercial law. It designates the system of rules, customs, and usages generally recognized and adopted by merchants and traders, and which, either in its simplicity or as modified by common law or statutes, constitutes the law for the regulation of their transactions and the solution of their controversies. The Uniform Commercial Code is the general body of law governing commercial or mercantile transactions.

28 U.S. Code § 3308 - Supplementary provision
Except as provided in this subchapter, the principles of law and equity, including the law merchant and the law relating to principal and agent, estoppel, laches, fraud, misrepresentation, duress, coercion, mistake, insolvency, or other validating or invalidating cause shall apply to actions and proceedings under this subchapter.
Uniform Commercial Code (UCC)
§1-103. Construction of Uniform Commercial Code to Promote its Purposes and Policies: Applicability of Supplemental Principles of Law.

(a) The Uniform Commercial Code must be liberally construed and applied to promote its underlying purposes and policies, which are: (1) to simplify, clarify, and modernize the law governing commercial transactions; (2) to permit the continued expansion of commercial practices through custom, usage, and agreement of the parties; and (3) to make uniform the law among the various jurisdictions.

(b) Unless displaced by the particular provisions of the Uniform Commercial Code, the principles of law and equity, including the law merchant and the law relative to capacity to contract, principal and agent, estoppel, fraud, misrepresentation, duress, coercion, mistake, bankruptcy, and other validating or invalidating cause supplement its provisions.
§ 2-104. Definitions: "Merchant"; "Between Merchants";

(1) "Merchant" means a person who deals in goods of the kind or otherwise by his occupation holds himself out as having knowledge or skill peculiar to the practices or goods involved in the transaction or to whom such knowledge or skill may be attributed by his employment of an agent or broker or other intermediary who by his occupation holds himself out as having such knowledge or skill.

(3) "Between Merchants" means in any transaction with respect to which both parties are chargeable with the knowledge or skill of merchants.

The right of survivorship does not exist among merchants for the benefit of commerce.

State of the Union Address, Franklin D. Roosevelt, January 4, 1935
We have undertaken a new order of things; yet we progress to it under the framework and in the spirit and intent of the American Constitution. We have proceeded throughout the Nation a measurable distance on the road toward this new order. Materially, I can report to you substantial benefits to our agricultural population, increased industrial activity, and profits to our merchants.