Criminal And Civil Law In Free-Market Justice

December 8th, 2011   Submitted by Wendy McElroy

What is a natural right as opposed to a right acquired by contract?

Natural rights begin with the idea that a human being is a form of property. The question becomes “who is the owner?” There are three possible alternatives: each person is a self-owner; someone else owns him (slavery); or he is an unclaimed good.

Natural law and common law treat the individual as a self-owner, who also has a strong presumed right to whatever he peacefully produces or acquires through his own labor, such as crops or a chair.

This conclusion may be derived from God, human nature, or logic, but it leads to the same legal place: it is inherently wrong to violate the person or property of a peaceful human being.

Otherwise stated: I do not need to contract with you in order to rightfully prevent or punish your assaulting me, raping me, stealing my purse, or burning down my home. Violent transgressions against my person and property are a priori wrong and should be treated as crimes.

By contrast, contractual rights are ones I acquire through agreement with another person. For example, if I hire a man to paint my house and give him a deposit of $500, then I have a right to performance or to have my $500 back.

Nothing in natural rights gives me a claim on the man’s time, labor, or wallet. I acquire the claim because of his agreement and acceptance of a “consideration.” The consideration is important because, otherwise, the “contract” is not an exchange but merely a promise, which has no legal force. Thus, contractual rights are legally enforceable claims that I acquire through a mutual agreement.

Roughly speaking, the difference between natural rights and contractual ones is legally recognized in the difference between criminal and civil law. (The current court system is far from a perfect expression of this division; but, then, the current system is far from perfect.)

Would a free-market system respect the distinction between natural and contractual, including the implications of the distinction that have evolved through common law? No one knows for sure, and competing visions have been sketched.

For example, at one time, the 19th-century touchstone anarchist Benjamin Tucker advocated a “society by contract.” When he became a Stirnerite egoist, Tucker concluded there was no natural right to live unmolested by others, but that such a right could be acquired only by contract. And, so, in a Tuckerian legal system I might well need to contract with others not to assault or to rape me.

Modern libertarians like legal scholar Randy Barnett have suggested that all violations of right be considered as civil violations, to be remedied and restituted as such.

Almost certainly, however, some if not most free-market defense agencies would ground their services in the prevention and punishment of crimes against person and property. They would consider murder and rape to be inherent wrongs, if for no other reason than that the vast majority of people throughout history and across cultures have viewed them as such. After all, it is “the vast majority of people” who would be their customer base. The adjudication of contract disputes might well be a separate service performed by a separate agency.

The procedural differences between criminal and civil actions are also likely to be preserved, because they evolved and have been proven over time to be guarantees of fairness. In criminal matters, the procedural protections include that the accused is innocent until proven guilty; the accuser bears a burden of proof beyond a reasonable doubt; the accused has a right against self-incrimination; and a “not-guilty” verdict cannot be appealed. The standards of evidence and bar of proof are raised high because the severity of the offenses is accompanied by equally severe penalties.

Moreover, it is common for punitive damages or punishment to attach to some criminal acts; for example, crimes committed with malicious intent. Thus, a man who laid in wait to beat up another person might be punished more than a drunk who mistook a friendly gesture for a hostile one.

By contrast, the procedures in civil cases are “loosened” to reflect the lesser severity of the offenses. For example, the plaintiff (accuser) bears the burden of presenting a case that the “preponderance of the evidence” supports. But once the plaintiff has presented such a case, the burden of proof shifts to the defendant. Other standards of proof and protections are similarly weakened, and punitive damages are uncommon.

There is at least one way, however, in which the procedure of free-market courts would differ markedly from the present system. Currently, a private party must file a lawsuit in order to bring a civil case, but the state files litigation in criminal ones; this is because society itself, and not an individual, is considered to be the victim of a rapist or thug.

Thus, criminal cases are often pursued even when the harmed individual does not want to press charges. In a free-market system, both civil and criminal complaints would have to be initiated by private parties. Moreover, those parties would need to have “standing”; that is, it is the harmed individual who has the right to press or waive charges.

(Note: there are exceptions. For example, an “interested” third party — presumably a guardian or relative — could speak on behalf of an infant or a coma patient. Equally, a third party would have to speak on behalf of a murder victim.)

In short, I believe many of the procedural aspects of the current system would prevail in a free market, including the division between criminal and civil law.

In my opinion, free-market defense agencies would not compete primarily on the basis of whether they sanctioned rape, adjudicated contracts, or distinguished between the two; the customer base would demand both services and such a distinction. The competition would be in how defense agencies adjudicated cases and in which penalties or punishments could be imposed.

Consider the how of it. Without exploring the complex topic in depth, we could list a multitude of possibilities regarding how a case could be adjudicated. They include

• a permanent panel of legal experts whose verdict defense agencies agree to accept;

• a panel of religious experts, as in Talmudic courts;

• a single professional judge or religious expert;

• a “wise man” respected in the community who is accepted as an adjudicator by both parties (for example, many libertarians would accept Ron Paul or David Friedman);

• a randomly selected jury, convened voluntarily or through payment;

• a permanent and trained jury;

• binding arbitration.


I do not believe the basic services provided by private defense agencies will vary in their fundamentals any more than the services of private police forces vary significantly. After all, the fundamentals of justice demanded throughout history have remained relatively constant.

Moreover, I believe most defense agencies would retain the distinction between criminal and civil offenses as well as incorporating tried-and-true protections of fairness. The two areas where wide differences are likely to be observed are in the adjudication mechanisms and in the sanctions or punishments imposed.

[Note: the foregoing continues a chain of speculation about what a free-market justice system might look like. I invite reasoned disagreement and alternative approaches.]

16 Responses to “Criminal And Civil Law In Free-Market Justice”

  1. Seth KingNo Gravatar says:

    I’ve come to the viewpoint that the difference between criminal law and civil law are moot. The real question is “what are you going to do about it?”

    If another offends you in any way, shape, or form(including both libertarian as well as non-libertarian offenses), you have three options. You can:

    A. Do nothing in retaliation, with the exception of complaining about it or boycott;

    B. Engage in Vigilantism(this includes the help of a gang of your buddies, i.e. defense agency);

    C. Voluntarily adjudicate the dispute.

    If the one who offends you refuses to engage in voluntary arbitration then you are left with choices A and B. If you choose strict non-violent resistance then you are left option A.

    In the case of the ongoing battle between libertarian anarchists and the state, it seems clear to me that the state is unwilling to engage in voluntary dispute resolution, so option C is out of the question.

    If an individual reneges on their agreement to, say, paint my house after I have already given him $500 he’s probably not very likely to engage in option C unless there is a strong disincentive against doing so, such as a loss of membership in his defense agency or a well executed universal boycott from a large portion of his peers, a highly efficient option A, so to speak.

    In order to get to that point, which I would say is most ideal, then we’re going to need many more libertarian anarchists in the world than we currently have, as well as heavily entrenched alternative institutions.

    But in absence of this idealized world we are left with options A and B if he reneges on his end of the agreement. Whether it is a criminal violation or a civil violation is totally moot if option C is out and you’re only willing to engage in option A as a response.

    If option A is inadequate or ineffectual then the real question is whether or not option B is a legitimate response to the affront. Since the offender has not allowed for option C, only the vigilante(s) will determine what sort of retribution/restitution is called for. If the vigilante(s) is/are well steeped in libertarian justice, then he/they will be careful not to engage in what he/they consider(s) unethical retribution. But even this is highly subjective. Perhaps only God knows what is just retribution/restitution per offense. But since he’s not, at least ostensibly, engaged in earthly adjudication, we have only ourselves to look to.

  2. HReardenNo Gravatar says:

    An example of a free-market DRO:

    How the referee was selected:

    A dispute settled by the DRO:

  3. cb750No Gravatar says:

    “They would consider murder and rape to be inherent wrongs, if for no other reason than that the vast majority of people throughout history and across cultures have viewed them as such. After all, it is “the vast majority of people” who would be their customer base.”

    This is scary to me. What if the vast majority consider homosexuality to be a crime? If the vast majority were conservative xtians or muslims then things could get a little skewed. And if the basis is to “serve the customer” then the customer could advocate slavery. What keeps the 95% from imposing their will on on the 5%?

    Now our current system isn’t that much better since it is also a majority system but relying on a system that is based on majority or history can be flawed.

    • WorBluxNo Gravatar says:

      But with homosexuality, there is nobody that would have standing against you.

    • Hello cb750. I am not calling for majority rule or for justice by consensus. The entirety of my point was that the initiation of force has been a fundamental basis of most justice systems across time and across cultures. Cultures may vary about which particular acts are ‘taboo’ even though they do not violate rights. But prohibiting the brute violation of rights — e.g. murdering an innocent person — has received almost universal assent. I raise the point not as a legal argument but as an insight into human nature. True…there is a connection between the two because I believe a peaceful, libertarian society and system of justice must be based upon human nature. In this system of the non-violation of rights (non aggression) clearly homosexuality would be a non-issue. Gays would be unmolested. But you could ‘discriminate’ against them at will. That is, you could exercise your right of non-association for any reason because non-association is peaceful.

      • cb750No Gravatar says:

        Hmm the passage seemed more arbitrary. Maybe I misread it. I’m just concerned about history fallacies (was done in the past) or majority rule fallacies.

  4. John KindleyNo Gravatar says:

    I don’t think I agree that “the difference between natural rights and contractual ones is legally recognized in the difference between criminal and civil law.” The purpose of criminal law, as Blackstone explained, is to prevent future crime, by incapacitation, deterrence, and/or rehabilitation. The purpose of civil law is to determine property rights, and these determinations can be made on the basis of natural rights or contractual rights. This difference is reflected in the fact that to convict a person of a crime the jury traditionally and in most jurisdictions must be unanimous and guilt proved “beyond a reasonable doubt,” whereas in a civil trial the plaintiff’s burden of proof is only by a “preponderance of the evidence” (i.e., more likely than not, or more than 50% likely) and the parties can stipulate to be bound by a majority. In a dispute over property rights, the dispute must be resolved one way or the other. One party or the other has the right to the property. In a civil trial, Justice is served directly, by determining the parties’ respective rights. In a criminal trial, on the other hand, Justice is served only indirectly, by preventing future injustices (an apparently rather speculative proposition), if it is served at all. Hence, it is better for 100 guilty persons to go free than for 1 innocent to suffer.

    • Hmmm…. Re: your disagreement. I have a question for you. It is not a trick question because I am truly trying to work out this area for myself. If you do not believe that criminal and civil law reflect a division between the violation of natural v. contractual rights, then can you name a civil violation that involves breaching natural rights? I will “load” my question a bit because I’d like to leave out tort cases (as I did in my article), although I know they constitute an important part of current civil law. As I write this I wonder whether tort cases constitution an overlap between criminal and civil, natural v. contractual right violation and that the difference between criminal and a tort may well be intention. I am thinking as I go along…so feel free to shoot holes in the foregoing. I’d do nothing but benefit.

      BTW, I use Blackstone when he valuable, which is often, but I don’t accept his authority..

      • John KindleyNo Gravatar says:

        I would think that, especially in a Stateless Society, legitimate disputes over land rights would constitute an important part of civil law. Such disputes don’t imply that one party or the other is committing a “crime” against the other. The homesteading principle is notoriously fraught with problems and ambiguities, as is the use-and-occupancy principle. Both of these principles are purportedly based on natural rights. (The problems and ambiguities inherent in these principles is one reason I consider myself a Nockian Georgist, but of course even Georgism would not alleviate all of the problems and ambiguities that might give right to conflicts.)

        • Hmm. As a first reaction, I think you are correct. Disputes about whether a fence is on your property or that of a neighbor are common causes for a civil action and they rest upon who has the right to the land. What seems to be missing is intention to harm.

          You state: “The homesteading principle is notoriously fraught with problems and ambiguities, as is the use-and-occupancy principle.” I agree. I may not be as uncomfortable with the ambiguities, however, as I think that the application of many rights (some are exceptions) have ambiguities and gray areas. The phrase “mixing your labor with the land” is open to various interpretations and requirements. In most cases, the ambiguities have been solved by cultural traditions, societal norms, common law precedent etc. As I said, I am not uncomfortable with accepting social norms on the margin as long as basic rights are entrenched. What you seem to be saying — and correct me if I misstate you — is civil courts would and should clear up the reasonable ambiguities that occur in the application of rights.This is interesting?

          What is your opinion of torts, John? I am thinking especially of physical harms such as an accident in which I step on your foot and break your toe, thus becoming liable for medical expenses but — under current law — not for pain and suffering or other punitive damages. These are also handled by civil court and, here, the dividing line is clearly intention. If I *purposely* stomp on your toe, then I guilty of assault with far more severe penalties. I’ve wrestled with torts since a discussion with Randy Barnett in which he quite correctly observed that the damage inflicted in both cases was identical and that, if you advocate a system of pure restitution, then the ‘sentence’ imposed for both an accident and an intentional act would probably be the same. I have been edging away from pure restitution for a long time now.

          BTW…and not to divert the discussion…is your Georgism based on the ambiguities in other land ownership theories? If it is, I must say that I find equal if not greater ambiguity in Georgism.

          • John KindleyNo Gravatar says:

            Oddly, even though I wrote my law school “dissertation” on an aspect of tort law (specifically, informed consent as it relates to medical malpractice), I don’t practice much tort law, and can’t call myself an expert.

            “Pain and suffering” is a recognized and legitimate element of recoverable damages in civil law, even if the harm was caused by mere negligence and not any malicious and purposeful intent. “Punitive damages,” on the other hand, are a very interesting part of the civil law, because their purpose is nominally not to compensate for injuries but to serve one of the purposes of the criminal law, namely, to deter future intentional wrongs. (Also, perhaps, to satisfy the desire for “retribution,” although whether this is a legitimate purpose of even the criminal law is controversial, with even Blackstone, for example, denying that it is a legitimate purpose of the criminal law.) It’s been argued, therefore, that receiving punitive damages may constitute an undeserved windfall for the plaintiff (particularly if the defendant has particularly deep pockets, since the amount of punitive damages needed to deter such defendants from harming others will presumably be correspondingly sky-high, and will not necessarily bear much relationship to the actual harm done to the plaintiff herself), although punitive damages can also be seen as compensation for the “dignitary harm” done to the plaintiff by an intentional wrong.

            Note also that “restitution” is a common part of the sentences in criminal cases, but that there it’s designed solely to compensate the victim for actual injury, with the punitive and deterrent purposes of the criminal law left to other elements of the sentence (most typically a prison term, whether executed or suspended).

            I understand why anarchists might prefer to do away with the criminal law altogether, and to have its purposes subsumed under the civil law, perhaps augmented with punitive damages (despite the problems with punitive damages noted above). As a matter of economics, one has to be concerned that floggings and hangings would be much cheaper than prisons, and who in an anarchic society is going to want to voluntarily pay for prisons to house and feed criminals, most of whom aren’t going to be able to ever earn enough money, in prison or out, to pay for their own upkeep there, let alone adequately compensate their victims? Furthermore, the avowed purpose of the criminal law, to incapacitate, deter, and/or rehabilitate, and thereby prevent future crime, is notoriously speculative. Nevertheless, the man who “shot a man in Reno just to watch him die . . . can’t be free,” at least until he’s satisfactorily rehabilitated. If we’re not going to kill him (and I don’t think we should), we’re going to have to imprison him. But I think in an anarchic society the role of the criminal law, and the number of persons housed in prisons, will be greatly reduced and minimized, to the absolutely necessary, for obvious reasons, but also because poverty causes crime and the State causes poverty.

            My Georgism is based partly but not entirely on the ambiguities in other land ownership theories. I’m intrigued by Albert Jay Nock’s assertion that were the Single Tax enacted “the reason for the State’s existence would disappear, and the State itself would disappear with it.” I think that an anarchic society will still need “national defense” (i.e., defense from existing, neighboring nations, until those nations themselves become anarchic), that this will necessarily be defense of a territory by those in the territory (and particularly by those claiming land rights in the territory), and that the Single Tax would provide the natural fund for such defense (and for the prisons I’ve claimed would still be necessary, and for the free and costless access to the courts Lysander Spooner claimed was necessary for a free society?). I’m also persuaded by Georgism’s fundamental principle, namely, that every person born into the world has an equal and unalienable right to the earth, a principle also recognized by Thomas Paine and Thomas Jefferson, among innumerable others. I think it would alleviate poverty, as George claimed.

            As for Georgism’s ambiguities, I think the most commonly cited is the objection that somebody is going to have to appraise the unimproved value of the land that people possess, on the basis of which the Single Tax would be assessed, and that these somebodies presumably might be amenable to influence and corruption. I think disputes of this sort would be eminently fit for resolution by civil juries, though the situation of a (presumably wealthy and influential) person assessed too little would be admittedly more problematic than the situation of a person assessed too much. (BTW, I’ve finally gotten around to really reading Spooner’s An Essay on the Trial by Jury, and I have to say I’m extremely impressed.)

            My Georgism might arguably make me a minarchist, but I don’t think it does. As Nock pointed out, there is a crucial difference between “government” and the “State.” Government is necessary and natural, and its purpose is “to secure these rights.” The purpose of the State is to steal from the poor and give to the rich.

  5. DarrenNo Gravatar says:

    People reading this website & particularly this excellent article might find this discussion over at LinkedIn of great interest:

    Is a democratic republic the best form of governance?

    In a now unfortunately deleted conversation the point was made that the present system of governance, the democratic republic, was the best yet devised. This may be true when compared to other systems of government, but not true when compared to a stateless society. I was hoping to explore this question at the now deleted conversation. I encourage those who were participating in that defunct exchange to post their views here. tem=83287104&qid=be895b4c-ddfe-46fa-aa05-01db1fccbe11&trk=group_m ost_popular-0-b-ttl&goback=.gmp_1776046

  6. DarrenNo Gravatar says:

    Reading some of the discussion above it occurs to me that sometimes anarchists get caught in the punishment trap when discussing law without govt. This is actually trying to argue anarchy in statist terms. In a stateless society the main deterrent to crime will not be the punishment criminals will receive, it will be the greater difficulty to committing crimes. The emphasis on crime prevention rather than law enforcement will see to this. Governments have incentives to take a reactive law enforcement POV. Those of us who are the would be victims are better of with a proactive crime prevention POV.

  7. Great work buddy, keep it up