charge a customer interest on a running account because it is his custom, unless the customer knows it. Nor will a custom be allowed to control the interpretation of a written instrument in opposition to its express terms, and courts are always averse to holding customs good where they vary the common-law obligations of the parties.

§ 34. Judicial precedent as a legal source of law. -A precedent is a rule of law laid down by a court in a judicial controversy as a basis of its decision. According to the old orthodox legal theory all common law had its legal source in custom. Precedents were declared to be nothing more than the evidences of customary law. While many courts still do lip service to this theory they do not nor have they ever observed it in practice. As Salmond says, it "was never much better than an admitted fiction." The practice is to regard judicial precedents as rules of law merely because they are precedents and wholly regardless of whether they are grounded on established customs or the mere discretion of the courts. Regardless of the legal theory, therefore, judicial precedent is in fact a legal source of law.

§ 35. Declaratory and original precedents.-Salmond classifies precedents as declaratory and original. "A declaratory precedent is one which is merely the application of an already existing rule of law; an original precedent is one which creates and applies a new rule. In the former case the rule is applied because it is already law; in the latter case it is law for the future because it is now applied." It is the latter class of precedents that is most important for it is through them that the courts exercise their law-creative functions. No legal system can be so complete as to anticipate all the possible conflicts of interests whose peaceful and just solution re

quires judicial settlement. When such cases come before the courts for adjudication they decide it as best they can, laying down as a basis for their decision some rule generally based upon common sense, practical expediency or justice. This precedent becomes a rule of law to be observed in future cases. This is what is known as judicial legislation. Two important distinctions must be made between this and legislation in its ordinary sense, and these are that judicial legislation is always retroactive, and that it should never be resorted to except when made necessary to the decision of an actual controversy by the absence of any statute, custom or precedent applicable to the pending case.

§ 36. Importance of precedents. What is common law is declared by the courts, and what the courts have declared to be the law is found in their records and published decisions. When a rule of law has once been declared it ought not to be disturbed unless by a court of appeal or review, and never by the same court, unless upon very urgent reasons and upon a clear manifestation of error; any other practice leaves the citizen in a perplexing uncertainty as to the law. A precedent, even where it appears to be flatly unreasonable and unjust, may and should be followed if it has been acquiesced in for a long period, or if it has become a rule of property, so that titles have been acquired in reliance upon it, and vested rights will be disturbed by overruling it. In such a case the better course is to leave the correction of the error with the legislature which can so shape its action as to make it prospective only, and thus prevent the injurious consequences that must follow from judicially declaring the previous decision unfounded.

3-Elem. Law.

§ 37. Some basis of regulating conduct necessary in modern society.-In every organized society real or apparent conflicts between the interests of its members are always found. As society becomes more complex these conflicts are more frequent and intricate. To adjust these disagreements justly and peacefully is one of the primary purposes of the state. To afford an effective basis for the adjustment is the function of the law. Law implies a set of established principles which the state will impose upon its members through its judicial power. To consider the social utility of the law we must consider the effectiveness of legal principles both as the basis for the determination of individual and social conflicts and for the effective co-operation necessary to modern society. This can best be done by considering the alternatives that are available to the organized groups. These alternatives are two in number. The first is to invest the authorities with supreme and arbitrary power of determining controversies according to individual whims or caprice. The

second is to invest the courts with authority to decide each individual case according to the dictates of right, natural justice or expediency, unrestrained by legal rule, precept or precedent. The first alternative may be dismissed without serious consideration as such a system would only be possible in a semicivilized country and under an absolute despotism. The second alternative deserves more serious consideration and is frequently advocated to a more or less degree by persons interested in reform. There are two questions then to be considered. The first must inquire as to what principles are necessary to the proper administration of justice. The second question involves the determination of whether legal rules on the one hand or the ideals of right, natural justice or expediency on the other, will best conform to those principles found to be necessary to the administration of justice.

§ 38. The basis of regulating conduct to be one that is general and equal in application.—If conflicting interests between individuals and groups are to be adjusted effectively and peacefully by the state then it would seem that there are certain general principles that should be observed. Among these principles are generality and equality. The absence of these in any civilized state would result in inevitable revolt. To enforce the contracts of A without enforcing those of B or to forbid one to carry on a business dangerous to the public health but permit it to another would be intolerable. One's sense of natural justice revolts against the very thought of such a system. This does not mean that there must be one rule for all men and all conditions, but that all men of like status and under like conditions and in like situations must receive equal consideration and treatment. That the state should require duties of married

men different from those required of bachelors does not violate the principles of generality or equality, but to compel one husband to observe certain duties to his wife and allow another under like conditions to violate them with impunity would constitute the grossest violation. The necessity of the observation of these principles is especially clear in the case of property rights. Unless the conflicts over property rights between individuals and between the individuals and the state are adjusted in conformity with these ideals there can be but little peace and progress in society. If the state under the forms of taxation takes a portion of A's property without touching that of B; if it will protect from the attacks of others the property of C, but leave the property of D subject to confiscation; if, in other words, the rights of property are not equally and generally enjoyed throughout the realm the incentives to productive labor will be diminished, while private conflicts and private vengeance over disputed rights will disturb the public peace. The lack of thrift, enterprise and industry among the natives of countries where these principles do not obtain bear eloquent testimony to their social value.

§ 39. The state's basis of regulating conduct to be one that guarantees certainty and uniformity.The requirement of equality can not be met except by the observation of other important principles and they are certainty or definiteness and uniformity. There can be no equal protection of individuals or property unless the principles in accordance with which the protection is accorded are definite and uniform. Different judges would differ between different cases unless they have for their aid and guidance certain principles so definite and uniform as to be capable of scientific application. The same rights of property come before the