culpa as a ground of liability, holds that causation of damage also can give rise to liability apart from any other element. This group of causation theory is represented by Thon, Pfaff, Mataja, and Adler.

Thon was the precurser of the modern causation theory on the continent. Prior to the work of Loening, he already doubted the justice of the culpa theory and expressed his belief that in certain cases at least a man should be held liable irrespective of culpability 349

Pfaff discussed in 1880 the adequacy of causation liability, enumerated cases under the Austrian law that fall under this group, and advocated that the Austrian law adopt causation liability side by side with culpa. 350 Though as an interpretation of the Austrian law, he had few followers, yet his contribution to the subject is undeniable.

Mataja351 argued that the aim and object of the law of compensation was the prevention of damage and the imposition of compensation on those who were, according to justice and social economic interest, best fitted for it. The task of the law is to divide the loss over the widest circle of society. The Roman maxims, 'casum sentit dominus,' or 'culpa semper prestatur: qui jure utitur neminem laedit' are unjust and inadequate in many cases. For instance, no compensation will be paid by an 'entrepreneur' to a person whose building was damaged by the operation of a railway or a factory, in many cases. In the same manner, the loss caused by an assistant of the principal will not be compensated for unless the latter could be held for 'culpa eligendo.' The principle 'casum sentit dominus' is also uneconomical, for it denies the division of loss to the widest possible circle of society. Mataja feels that the old Germanic idea of combining responsibility with dominion ('Herrschaft') and enjoyment ('Genuss') will work out better justice than the Roman maxims. He also advocated the extension of cases of causation liability, but did not construct any theory of the subject. His chief contribution seems to consist in having thrown light on the economic background of causation liability, especially of enterprise liability.352

349. "Rechtsnorm," 106, 107 (1878).

350. Gutachten über die Revision d. Schadensersatzrecht," H. St. XXX, III T-d. OEBGB, 11 seq., 43 seq. (1880); Grünh. Z, Vol. VIII, p. 701 seq. (1881).

351. "Recht d. Schadensersatz v. Standpunkt d. Nationaloekonomie (1888); Schadensersatz im Entwurf d DBGB," Archiv BR, Vol. I, pp. 267-282 (1889).

352. For criticism of his theory see Rümelin, "Gründe." 7 seq.; Randa, 7 seq.; Mauczka, 4; Brock, 176; Burckhardt, 504; Voight, Fälle," 11.

Karl Adler, in his speech entitled "Unverschuldetes Unrecht" (1909), classifies cases of causation liability into quasi-causation liability, and pure causation liability. Quasi-causation liability is where the violation or endangering of another's interest is allowed as an equivalent for compensation irrespective of culpa when damage occurs. He places liability of a railroad enterpriser and the liability of an automobile owner under this group. Pure causation liability is where the violation of interest is not allowed, and compensation is ordered irrespective of fault if that forbidden violation takes place. The distinction between quasi-causation liability and pure causation liability, he says, lies in the fact that in the former an injunction or self-defense is not allowed, while in the latter they are. Also in the former case the damage is foreseeable and so is really based on culpa, and, often, on dolus for that matter, though the conduct is perfectly legal. In the latter case, as the result is entirely unforeseeable, the liability is truly without culpa. He subdivides pure causation liability into those cases that are based on presumed culpa, e. g., employer's liability for the act of his employe, liability of the possessor of an animal, etc., and those cases wherc the conduct cannot be attributed to culpa in any form, the liability being based on the protection of the other party, e. g., liability for non-negligent mistake, liability of a non-responsible person (lunatic and infant), etc.353 354

Now what is the basis of causation theory? Why is it that the causation of damage by one party has an intrinsic power to give rise to liability to compensate the damage to the other party? Various views have been expressed, but they may be classified as: (1) the historical argument, (2) the natural justice argument, and (3) the formalistic argument.

(1) Historical argument. The historical argument is that the old Germanic law was based on causation theory as to compensation 353. For criticism see Fischer, "Rechtswidrigkeit," 131-3; Rümelin, "Schadensersatz," 23, Anm. 3, 30, Anm. 1.

354. For other advocates of causation theory in a wider or narrower extent see Cohnfeld, "Lehre von Interesse." 33 seq.; Schmidt, "Gutachten a. d. Anwaltstand." 1183 seq.; Westrum, ibid. 240; Baron, "Schriften Socialpolitik." Vol. XIX, p. 125; Gierke, "Entwurf." 259 seq.; Soc. Aufgabe d. Pr. R," 32 seq.; Martin, Z Schw R, Vol. XXX, p. 1 seq.; Mellinger, "Culpa in contrahendo," 145 seq.; Luschinger, "Verschuldungsprincip." 12 seq. See also Huber, Schmollers Jahrb, Vol. LXXXXVI, p. 130 (he allows the modification where the application of causation theory is against 'Billigkeit'); Ullmann, Verhandlung, DJT XXII, I, 531 seq. (recognizes causation theory side by side with culpa theory); Unger, "Handeln auf eigene Gefahr," 129 seq. (recognizes causation theory side by side with culpa theory and goes on the principle of 'Eigenes Interesse, Eigene Gefahr,' where causation theory is applied); Hedemann, "Fortschritte," 83 seq. (makes culpa, causation of damage, and equity three grounds of liability).

in general and that it was so in the stage of legal development where the culpability theory had been established in the criminal law. Thus, it is said that the causation theory is based on 'perfect Germanism' and not on any crude and naïve legal conception. It is doubtful at least whether this argument can justify causation theory.355 Some doubts have been thrown on the alleged historical fact itself,356 but admitting for the moment that the historical fact was as advocated, this Germanic conception has long been in desuetudo and has been replaced by the Roman doctrine of culpa so far as the countries where the civil law prevails. We have already. seen that almost all the modern codes adopted culpa as a basis of liability. In Anglo-American countries, the establishment of that idea was slower, but we have seen that at least in the latter part of the nineteenth century the principle was established that fault was the basis of liability. The mere assertion, therefore, that the old Germanic law was based on causation theory cannot be a sufficient justification for causation theory.

(2) Natural justice argument. Advocates of causation theory sometimes say that the theory is based on natural law.357 It is true that the causation theory of the natural law period exerted some influence on the legislations of Prussia, Austria, and France.s But it must be remembered that its influence was not such as to drive out the culpa theory entirely, and that such an argument, though appropriate as an explanation of such legislations, can not be utilized as a theoretic ground of causation theory. Other advocates treat it as a matter of course. 359 Yet, it is doubtful whether such a dogmatic assertion without any inner justification is worthy of much scientific credit. It is also said that the causation theory is in accordance with the social ideas and juristic sentiment of society." This is no argument, but mere unconscious dogma. Instances can

860

355. See Hammer, "Lehre von Schadensersatz nach d. Sachsenspiegel, etc." (Gierkes "Untersuchung," H, 1985); Schmidt, "Schadensersatz in d. Volksrechten" (ibid. H. 18); Müller-Erzbach, II, 57 seq. See also Brunner, "Rechtsgeschichte," II, sec. 124; Gierke, "Soc. Aufgabe," 33; Adler, 9 seq.; 25; Neubecker, 125 seq.

356. Rümelin, "Gründe." 27 seq.; "Schadensersatz," 16; Anm. 2; Pavlicek, 6; Burckhardt, 523; Mauczka, 106; Luschinger, 3, 4; Müller-Erzbach, II, 11 seq., 62 seq., 70, 74, 81 seq.

357. Pfaff, "Gutachten." 8 seq.; Kranopolski and Mauczka follows him. So also Martin, ZSchwR, Vol. XXX, p. 1 seq.

358. Pavlicek, 7; Burckhardt, 526; Hedemann, 85 and Anm. 4; Randa, 83 seq.

359. Binding, "Normen," 471; Mauczka, 13; Neubecker, 130 seq.; Adler, 128, 129.

360. Gierke, "Entwurf, 260; Schmidt, "Gutachten a. d. Anwaltstand," 1185 seq.; Adler, 16.

easily be cited where social ideas and juristic sentiment will be against causation theory. It is also argued that the causing agent may not be guilty but the injured party is less guilty,31 perhaps based on the subconscious idea that it is in accordance with natural justice that the causing agent must make reparation. We can dispose of this argument by saying that there may be degrees of culpa but there cannot be degrees of non-culpa.

(3) Formalistic argument. It is also argued that all compensation is a legal consequence partaking of the same nature. All compensation must be based on the same legal ground. Culpa is not always a requisite of the liability of compensation, while the causation of damage is. Therefore the causation of damage is the ground of liability 362 This line of argument, however, is a logical fallacy. The premise that the same cause produces the same result is perfectly correct, but it does not follow that the same result is always produced by the same cause. The fact that the causation of damage always exists does not show that it is the only cause. Culpa may not be a requisite in some cases, but it is possible that some other requisite besides the causation of damage is required. Suppose that A (causation) plus B (culpa) equals C (compensation) is the usual formula. In some cases, B is absent and produces C. It does not follow there from that A equals C, for it may be that the formula in such cases is A plus X (extra-hazardousness, for instance) equals C. The argument does not show positively that the causation of damage can independently produce compensation.

In short, the arguments so far advanced to account for the basis of causation theory are not convincing enough to upset the orthodox idea that damage falls where it falls, unless some specific grounds exist to shift it to other persons.

We now proceed to the criticism of causation theory. That the causation theory of the first type advocated by Binding and Neubecker is inadequate and impractical will need little argument. The adoption of such strict liability in all cases will unduly obstruct the freedom of conduct, and it may weaken the sense of responsibility of people at large. For if a person cannot escape liability though he uses the utmost care, he will probably not use even ordinary care, and this may happen especially if causation liability is imposed on persons pursuing the ordinary interests of daily life.

361. Binding, 472; Gierke, "Soc. Aufgabe," 33; Baehr, Jherings J. Vol. XIV, p. 407.

362. Binding, "Normen," I, 445, 471 esp. Anm. 19. Sjoergren, 343 seq., 353 seq., 406-414; Mauczka, 13, 14.

The second and third type of causation theory, however, makes a compromise by recognizing culpa either as one ground of liability or by restricting application of causation theory so far as the normal relations of human society are concerned. Thus, the difference between culpability theory recognizing causation liability in certain cases, and the causation theory thus restricted, becomes practically very slight.363

EQUITABLE THEORY

The idea of equity has been utilized in various forms in the theory of causation liability. It is sometimes called 'Billigkeit,' 'Gerechtigkeit,' 'Utilität,' 'Zweckmässigkeit,' 'Socialgerecht,' 'Verkehrsbedürfniss,' etc., but all these words, though with different shades of meaning, represent essentially the same line of thought. It is utilized in a discussion 'de lege ferenda' or as an explanation of the code provisions where no specific reasons can be assigned for the liability recognized in those provisions. The extent of the recognition of this idea is wide or narrow, according to different jurists, but usually the idea is utilized to supplement or modify other grounds of liability.

There are two types of equitable theory, the one advocating equity as a ground of liability, the other insisting on the equitable division of loss.

The former type of equitable theory may be subdivided into one that makes equity the ground of causation liability in general, and one that recognizes equity as a ground of certain cases of causation liability. To the former belong Randa, Pavlicek, Tisch,364 while the latter is represented by Hedemann, Bluntschli, Unger, and Merkel.Se Especially noteworthy is the view of Hedemann, who recognizes 'Billigkeit' as a third ground of liability together with culpa, and causation of damage. He calls it "Princip der konkreten Billigkeit," and applies that principle in certain cases of causation liability, esp. liability of lunatics and infants, and also liability for imminent acts.

363. It may be objected however that the causation theory will find itself difficult to delimit the extent of liability. For this line of criticism, see G. Rümelin, "Kulpahaftung," 289 seq.; M. Rümelin, Gründe," 28, seq.; "Schadensersatz," 62 seq.; Burckhardt, 523; Geiser, 60 seq.; Schey, 658; Pavlicek, 9; Heischeimer, Archiv CP, Vol. VC, p. 240; Müller-Erzbach, 290 seq.

364. Randa, 14; Pavlicek, 10, 11; Tisch, Boem. JT. So, also, Menger, "BGB und besitzle. Volkskl.," 192; Mitteis, OeZB1, Vol. XV, p. 275; Wilems, Rev. gener., Vol. VC, p. 147.

365. Hedemann, 107 seq.; Bluntschli, "Komm. zu Zuerich. GB." Vol. III, p. 648; Unger, 27, 140; Merkel, 155. Unger and Merkel explains the liability of lunatics and minors by this idea.