Course:Law3020/2014WT1/Group M/Natural Law



Hodgkinson v Simms

Case on Natural Law: According to the natural law theory as expressed by Thomas Aquinas, four elements are required for a law to be valid:

1. Must be directed to the common good

-what is the purpose of the law?

The purpose of the law is to protect vulnerable parties entering into commercial transaction relationship.

•	to promote honesty in dependent business relationships

Common Good: Protecting fiduciary relationships promotes the common good by protecting vulnerable parties in contracts and prevents the unjust enrichment of stronger parties who take advantage of the power imbalance in the relationship. (by in this case failing to disclose a conflict of interest)

2. Must follow practical reason (reasonable steps leading to the common good) The court is awarding damages to the injured party for the purpose of compensating his losses and to deter dishonest conduct in reliance business relationships. -who’s common good? -people engaging in commercial transactions require the certainty of knowing that all accountants would be required to follow predetermined professional standards including the obligation to report conflicts of interest. -for the good of anyone engaging the services of accountants or employing financial professionals.

3. Must be made by valid lawmaker (ruler within community, who hold this position by reason of the natural order) The fiduciary duty recognized by the court in this case is based not on written but on an equitable common law principle. Natural law according to TA would not agree with this decision because the court is expanding and redefining what a fiduciary relationship is in this situation. Despite the courts motivation to further the common good, TA would be skeptical of the courts ability to achieve this objective. The courts could have been influenced by sympathy for the plaintiff after he lost all his money. Aquinas would like to share the court’s underlying objective but would prefer pre-exisiting written rules created by “valid law makers”. Aquinas did not see judges as valid lawmakers.

4. Must be promulgated This was a common law principle, expanded by the court’s decision. Aquinas believed that the law should be predetermined and certain. The common law is, by definition, ambiguous and uncertain until clarified in a given factual context. Aquinas would not have seen the dynamic and changeable nature of common law to be properly promulgated in advance. Furthermore, Aquinas felt that the law should be accessible to the average person, however, it could be argued that this 100 page judgment is not obscure and difficult for the average person to understand.