Theorizing Corporate Law in a Mixed Jurisdiction. A Review Essay of Droit des sociétés par actions: Principes fondamentaux, by Raymonde Crête and Stéphane
Rousseau (Montréal, Les éditions Thémis, 2002, 1008 pp., $80).
1. Introduction
Raymonde Crête and Stéphane Rousseau, who teach at Laval University and at the University of Montréal respectively, are two of Québec’s foremost contemporary corporate law scholars. The recent publication of a textbook co-authored by them is thus in and of itself an event that deserves mention.1 This is especially true in the context of corporate law scholarship in Québec, where one particular text, that of Martel and Martel,2 has for all practical purposes exercised a hegemonic domination on that field for the past thirty years or so. This new publication therefore constitutes not only a most welcome addition to the corpus of corporate law scholarship in that jurisdiction, but also, as I will show in this review, a major one, despite the rather modest objectives that the authors have set for themselves.
First, I shall briefly comment on the pedagogical dimension of their book, after which I will examine some issues pertaining to substantive law, the most important of which deals with the “mixity”3 of corporate law sources in Québec. Lastly, I shall discuss the theoretical approach they adopt in their book and raise some questions about the role of a pedagogical tool such as a textbook in the creation or perpetuation of doxae in the
1 R. Crête & S. Rousseau, Droit des sociétés par actions : Principes fondamentaux, (Montréal, Les éditions Thémis, 2002).
2 P. Martel, Précis de droit des compagnies au Québec, (Montréal, Wilson and Lafleur - Martel, 2000).
3 This neologism refers to the condition of a mixed jurisdiction, that is, a jurisdiction the legal regime of which does not belong to a single legal tradition. It has been argued that mixed jurisdictions share specific traits, and thus constitute, in and of themselves, a family apart from the civil law or the common law ones. See generally V.V. Palmer, ed., Mixed Jurisdictions
field of corporate law,4 which ultimately speaks to the role ascribed to that field in legal thought. I shall propose in my conclusion some paths for further theoretical reflection.
2. On the Pedagogical Dimension of the Book
I mentioned in the introduction that the objectives of Professors Crête and Rousseau for their book were modest. Indeed, according to them, this first edition has been essentially conceived of as an introduction to the fundamental principles and rules governing the creation, funding and governance of business corporations.5 It is thus no surprise to see the extent to which pedagogical concerns played a role in the structuring and in the conception of the book, which contributes to distinguishing it from a treatise. In addition to a traditional analysis and critique of the positive law, the book also includes excerpts of decided cases, questions targeted at the reader, fact-patterns, as well as corporate forms. Interestingly, however, all this is done in a manner that could be characterized as “typically civilian”, in that the doctrinal synthesis and critique of the law forms the main part of the book, while the excerpted cases essentially serve as illustrations of the principles previously discussed.
Such an approach makes perfect sense in the context of Québec, where the jus commune in private law matters is the civil law. It bears mentioning for the benefit of readers unfamiliar with the features of that legal tradition, that doctrine has always played a significant role not only in the exposition of legal principles but also in their critique, and thus in the evolution of the law. That being said, enhancing the authors’ theoretical exposition of the positive law by actual cases as well as fictional fact-patterns is, from a pedagogical standpoint, a sound decision, as approaching these different forms of texts forces the readers – recall here that the main audience targeted by the book is composed of law students – to develop different skills, be they of deductive or inductive nature. Appealing to different types of learners is thus important, and the authors must be praised for having taken this into consideration.
Another interesting feature of their textbook from a pedagogical standpoint is its contextual and dynamic approach. Indeed, while it is trite to say that corporate law not
4 For a definition of the concept of doxa see infra, note 65. 5 Crête and Rousseau, supra, footnote 1, at p. 2.
only stands at the interface of several areas of the law, but also speaks, albeit to a different degree, to other disciplines such as accounting, economics or industrial relations, most introductory textbooks generally stick to the traditional model of the classical exposition of the positive law and do not refer to these other bodies of knowledge. This is not the case with Crête and Rousseau’s text. For them, corporate law cannot be examined and understood in a vacuum, that is, as a mere set of rules (whatever their origins), as it itself participates in the socioeconomic evolution of one’s society. For instance, in addition to the law and economics approach that inspires the entire book, they do not hesitate to refer to accounting theory to explain and put in context the application of statutory solvency tests,6 or to collective action theory to explain shareholders’ behaviour.7 Interestingly, by opting for what I have called a contextual and dynamic approach to corporate law, the authors help to bridge the gap often alleged to exist between the acquisition of a solid theoretical understanding of a given field of law and the skills needed to practice it.
I have so far drawn my readers’ attention to the pedagogical dimension of Crête and Rousseau’s text. From that standpoint, their work deserves to be praised: they have indeed provided corporate law students – their primary audience – as well as scholars, practitioners and judges alike with a very well conceived, clearly articulated and intellectually challenging textbook. Should I ever teach corporate law in French again or to an audience comfortable enough in that language so as to be able to read a complex text, I would not hesitate to use it. And should there ever be funding for translating into English that kind of book, I would certainly support it. Indeed, helping the diffusion of such a good piece of work also explains why I decided to write this review in English. That being said, the success of Professors Crête and Rousseau’s textbook as a pedagogical tool should not prevent us from recognizing the quality of their work from a substantive law standpoint or from admiring the consistency they demonstrate in applying a theoretical framework that, as I shall argue in the fourth section of this review, is open to some criticism. I will address these two dimensions in turn in the remaining
6 Ibid., at pp. 294-302.
7 The authors refer to the work of M. Olson, The Logic of Collective Action: Public Goods and
part of this review, bearing in mind, however, that such a brief review will never do justice to a book of such quality.
3. On the Substantive Law Dimension of the Book: Corporate Law’s Contractarianism and Québec’s Bijuralism
As far as substantive law is concerned, it bears noting that one of the authors’ main assumptions, which is factually validated, is that corporate law can increasingly be described as offering socioeconomic actors the capacity for self-regulation, where contractual freedom is the rule rather than the exception. Hence the dominance in corporate statutes of enabling and facilitating rules over mandatory ones, a situation which is unlikely to change, even in a post-Enron corporate world. As an aside, corporate law’s contemporary contractarianism could be analyzed as evidence of the enduring presence in that field of law of the anthropomorphic-anthropocentric model that still inspires to a certain extent, in spite, or because of, Salomon,8 the theorization of the corporation. That being said, coupled with the authors’ adoption of the economic analysis of the law as their theoretical approach, this emphasis on the contractarian dimension of corporate law entails consequences on the choice of topics addressed in the book. For instance, the authors dedicate a full chapter to shareholders agreements, where, in addition to examining the corporate law and civil law frameworks governing the different types of such agreements, they provide an unusually thorough analysis of the most usual clauses found in them.9
As well, still in line with their self-regulatory/contractarian vision of corporate law, they dedicate almost thirty pages in the chapter on conflict resolution in corporate settings to alternative dispute resolution mechanisms10. This is a most welcome initiative given the increasing popularity of such mechanisms in the corporate sphere. Moreover, their discussion of these mechanisms is all the more appropriate from a pedagogical angle, since it is likely to induce their primary audience, that is, corporate law students, to
8 Salomon v. Salomon & Co., [1897] A.C. 22 (H.L.). For further details on the claim that an anthropomorphic-anthropocentric model inspires the theorization of corporate law, see this review’s conclusion.
9 Crête and Rousseau, supra, footnote 1, chapter 7. 10 Ibid., at pp. 887-917.
look at corporate law through a different prism than the pathological one normally adopted in law schools and which tends to reduce the study of corporate law to that of juridified disputes resulting in court decisions. While such a perspective is to some extent inevitable, it obscures the facts that corporate actors are generally eager to avoid litigation – therefore pointing to the preventative rather than the merely curative nature of corporate law practice -- and that most of the time corporate law does work effectively without judicial interference. I shall address further questions pertaining to the contractarian conception of corporate law adopted by Crête and Rousseau in the fourth part of this review.
The second important dimension of their textbook on which I want to focus is the rather sinuous evolution of corporate law in Québec. Indeed, very early on, corporate law in that jurisdiction took on a peculiar dimension as a result of a conjunction of factors that were present when the Civil Code of Lower Canada was enacted in 1866. As the authors point out, Anglo-American corporate forms were borrowed under the influence of a business class that was then essentially of Anglo-Saxon origins and whose primary markets were the United Kingdom and the United States of America, that is, common law jurisdictions, rather than countries where the civil law prevailed.11 Thus, the reliance on what initially was a common law model for corporate law in Québec was not due to a legislative belief in the intrinsic superiority of that model, but was rather the result of a politico-economic decision.12 But the enduring presence of the common law in an otherwise civil law jurisdiction as far as private law is concerned has forced Québec
11 Ibid., at p. 28.
12 Market- and geography-inspired considerations still influence Québec legislators to some extent. For example, while contractual partnerships in French law are recognized as having a legal personality distinct from that of their members, the Québec legislature has decided, in the Civil Code of Québec, to adhere to the law as it existed under the Civil Code of Lower Canada and to refuse to recognize them legal personality. This decision was taken essentially because common law partnerships are not vested with distinct legal personality, which makes them extremely useful tools in tax planning, notably by allowing the partnership’s losses to be funneled to its members. However, the National Assembly has yet to show a similar sensitivity to market and geographic considerations in respect of corporate legislation in Québec. Indeed, the Companies Act, R.S.Q., c. C-38, which can be accurately described as a ‘patchwork legislation’, provides corporate actors governed by it with a rather antiquated framework, notably as it regards remedies, that would deserve a complete and systematic overhaul. In that regard, it would be interesting to compare, from the standpoint of the number of “provincial” incorporations, the relative “performance” of Québec corporate legislation with that of other provinces that have modernized their corporate laws.
jurists to make sense of what David Howes once referred to as the “polyjurality” of Québec law.13
For instance, several authors tried to determine, particularly in the sixties and seventies, how to reconcile a private law regime where the jus commune is of civilian inspiration with a corporate statutory framework, both at the federal and provincial levels, that clearly embodies common law concepts and approaches.14 While acknowledging the inescapability for Québec to take into consideration its North American economic and juristic environment, particularly in the field of corporate law, these authors emphasized that any attempt at borrowing concepts from the common law had to fit within the broader conceptual and terminological framework provided by the civil law.15 In that respect, Crête and Rousseau highlight the enormous significance of title V of the new Civil Code of Québec as this title reinforces the role of private law (and thus of self-regulation) in Québec corporate law, but in a manner that is consistent with Québec civil law.16
From the standpoint of the methodology of comparative law, making sense of the continuing relevance of some common law sources while ensuring that their use does not distort a legal framework posited as civilian first and foremost requires avoiding an epistemological obstacle that could be designated as the “craving for convergence”.17 This obstacle stands at the opposite end of another one, the Freudian “narcissism of small differences”, which, for its part, induces jurists to amplify little differences so as to minimize the actual significance of the commonalities that are perceivable between the objects compared, or even to deny the possibility that such commonalities might exist,
13 D. Howes, “From Polijurality to Monojurality: The Transformation of Quebec Law, 1875-1929” (1987), 32 McGill L.J. 529.
14 Crête and Rousseau, supra, footnote 1, at pp. 50-59. 15 Ibid., at p. 55.
16 Ibid., at p. 43.
17 The concept of epistemological obstacle, elaborated by French philosopher Gaston Bachelard, designates the mechanisms, essentially discursive, that cause inertia, stagnation or setback in knowledge, and that do not have any fixed identity, but which all serve the same “blocking” function. For example, a metaphor that is constantly reiterated may end up being perceived as accurately representing the object or subject it seeks to evoke and, in doing so, may prevent observers from fully grasping the complexity of that object or subject, thereby acting as an epistemological obstacle. See G. Bachelard, La formation de l’esprit scientifique : Contribution à
thereby adopting a postulate of incomparability, or, worse, of incommensurabilty.18 To return to the “craving for convergence” obstacle, suffice it to say that this obstacle induces jurists to brush aside differences between legal systems or traditions for ideological or pragmatic purposes, in forcing upon the process of comparison universalistic assumptions so as to obtain results that will reflect the comparatist’s expectations. Another version of this obstacle arises when observers constantly look for the all-explaining, unifying rule, be it within a given system of law, or between different systems of law.19
That craving for convergence is especially likely to manifest itself in today’s globalized world, where differences are often perceived as impediments to a smooth functioning of the global economy. Inevitably, that obstacle is especially likely to arise when a mixed jurisdiction, such as Québec, is surrounded by non-mixed ones in a context of economic integration. That being said, with both the “craving” or the “narcissism” obstacles, givens, assumed or desired, end up, on the one hand, obfuscating the constructivist processes at work in comparative legal endeavours, and, on the other, obscuring the fact that the objects compared are more often than not constructs themselves. Crête and Rousseau’s textbook avoids both types of obstacles, but especially the craving one. For example, in their analysis of the duty of skill imposed upon corporate directors, they correctly recognize that the application in the Québec context of the rules of the civil law mandate could lead to the imposition of a more stringent and objective standard upon corporate directors in that province.20 Had they fallen prey to the craving obstacle, they would have tried to obscure this difference.
That being said, Professors Crête and Rousseau correctly reject blind and purely utilitarian imports of common law concepts. Indeed, if the transplant of a legal concept or tool is to really be successful, its roots must to some extent be relinquished by being absorbed by the new framework in which that concept or tool is transplanted, that is, by being recognized by that framework as an endogenous, albeit new, element. This,
18 On comparability, see M. Detienne, Comparer l’incomparable (Paris, Seuil, 2000), and on commensurability, see H.P. Glenn, “Are Legal Traditions Incommensurable?” (2001), 49 Am. J. Comp. L. 133.
19 See R. Sacco, “Legal Formants: A Dynamic Approach to Comparative Law” (1991), 39 Am. J. Comp. L. 1. at p. 21.
obviously, points to the difference between transplanting a rule – which is impossible because that rule’s new framework cannot but change its nature and possibly its meaning and scope, thereby transforming it into a brand new rule – and transplanting an idea, a concept, even a norm,21 which is feasible provided the idea or concept so transplanted is integrated in its new environment in such a way that this environment is not unduly upset.22 In other words, the receiving system’s homeostasia must, to some extent, be maintained.
This type of reflection, albeit formulated in a less theoretical manner, was for a long time the bread and butter of Québec’s corporate law scholars, for the question of the sources of law, which is extremely important in any civil law jurisdiction, becomes critical in a mixed jurisdiction such as Québec.23 In that sense, Crête and Rousseau’s text, with its subtle grasp of the interaction of the civil law and the common law in Québec’s corporate law environment, can rightfully claim to continue the work of the late Yves Caron and Robert Demers. The situation has changed in some important ways since the writings of Caron and Demers, but Crête and Rousseau are up to the task of making sense of these changes. The debate about which jus commune ultimately applies in the field of corporate law in Québec has now been settled in favour of the civil law both by the National Assembly, in the recently adopted Civil Code of Québec, and, at the federal level, by amendments to the Interpretation Act24. Nevertheless, there remains the 21 On the difference between a norm as a concept, and its potential textual expressions in rules, see E. Le Roy, “Norme (en anthropologie du droit)”, in A.-J. Arnaud et al., eds., Dictionnaire
encyclopédique de théorie et de sociologie du droit (Paris, L.G.D.J., 1993) at p. 403.
22 See: P. Legrand, “What Legal Transplants?”, in D. Nelken and J. Feest, eds., Adapting Legal
Cultures (Oxford, Hart Publishing, 2001), p. 55. On legal transplants, see also A.-J. Arnaud, Pour une pensée juridique européenne (Paris, Presses Universitaires de France, 1991) at p. 239.
23 Emphasizing the importance of the theory of sources in civilian jurisdiction does not mean, however, that this theory cannot evolve, nor should it lead observers to blind themselves to the fact that the modes of production of law in civilian and in common law jurisdictions are increasingly converging. Indeed, more and more scholars in the civil law tradition argue for a formal recognition of case law as a source of law, given the substantial impact praetorian law has on the evolution of positive law. See, inter alia, P. Jestaz, “Source délicieuse (Remarques en cascades sur les sources du droit)” (1993), 92 Revue trimestrielle de droit civil 73.
24 Section 8.1 of the Interpretation Act, R.S.C. (1985), c. I-21, reads as follows: “Both the common law and the civil law are equally authoritative and recognized sources of the law of property and civil rights in Canada and, unless otherwise provided by law, if in interpreting an enactment it is necessary to refer to a province’s rules, principles or concepts forming part of the law of property and civil rights, reference must be made to the rules, principles and concepts in force in the province at the time the enactment is being applied.”
question of what to do with common law sources in the field of corporate law in Québec, especially the case law. I think it is fair to say that Crête and Rousseau’s approach to this question is that, as reformed, the civil law is now globally sufficient to provide an adequate framework for the adjudication of corporate disputes in Québec, but that common law sources are still relevant in the interpretation of provisions inspired from common law jurisdictions. For substantial as well as procedural reasons,25 these sources will never alone determine the interpretation, but could certainly serve as persuasive authorities provided they can be (re)conceptualized from a civil law standpoint.26
Throughout their book, Crête and Rousseau show an unflinching will to relocate the corporate law of Québec within the civil law framework, although without trying to obscure the continuing relevance of common law sources when appropriate. The end result is not a bastardized version of the civil law, for there is neither a “pure” model of civil law, nor a hegemonic model of it,27 but rather an open-textured conception of the civil law that seeks to maintain its internal consistency and conceptual unity without adopting fundamentalist attitudes. This further requires interpreters to develop considerable skills in comparative law and for this too, the work of Crête and Rousseau must be commended.
Such a program, however, imposes upon Québec jurists the duty to make full use of all the tools that the civil law tradition has to offer, and that had at a certain point been
25 In addition to the clarification of the jus commune applicable in corporate law cases in Québec, the very idea that a prior case emanating from a higher court could alone, absent a real persuasive authority, determine the outcome of another one is somehow inconceivable in the civilian tradition, as this tradition does not formally know stare decisis. See F. Allard, “L’impact de la Charte canadienne des droits et libertés sur le droit civil: une relecture de l’arrêt Dolphin Delivery à l’aide d’une réflexion sur les sources du droit civil québécois” (2003), numéro spécial Revue du Barreau 3 at p. 23. However, departures from a consistent line of cases emanating from a higher court (jurisprudence constante), especially a supreme one, are almost equally inconceivable from a practical standpoint.
26 On persuasive authority, see H.P. Glenn, “Persuasive Authority” (1987), 32 McGill L.J. 261. 27 There may be a conceptual unity amongst the different expressions of the civilian tradition, but the similarities stop at this stage, as at least two main models have emerged over the past two centuries: the French and the German ones. If we add to the jurisdictions which have closely followed one or the other of these models the ones where they have both been sources of influence, as well as the ones where the civilian tradition has had to interact with another one, for example the common law or the Confucian tradition, we end up with a striking level of diversity within the so-called “civilian tradition”. That diversity is further increased by the absence of any real lingua franca that would link together civil law jurisdictions, this, contrary to the situation that prevails in the common law tradition where English still serves as a lingua franca.
forgotten. The civil law, it is to be remembered, is not reducible to the Civil Code, a reduction that was unfortunately imposed upon it for some time in the 19th and 20th centuries in several civilian jurisdictions, including Québec.28 There was indeed a time where codification was understood as having somehow exhausted the civil law, and thus unwritten law (that is, usages, customs, equity, and, most often, general principles of law) was all but forgotten. Moreover, especially in France, the voluntarism associated with codification, coupled with a longstanding suspicion of judge-made law, led to a devaluation of praetorian law as a legitimate source of law. While the status of case law as a formal source of law still raises some debates in France, the very fact that a growing number of jurists in that jurisdiction now seem inclined not to blind themselves anymore to the reality of the judge as a creator of law probably indicates the definitive passing of literalism in the civilian tradition and heralds a much-awaited reconfiguration of the formal sources of law in that tradition, which, as an aside, is likely to bring the civil law closer to the common law.29
The attempt by Professors Crête and Rousseau to relocate the corporate law of Québec within the civil law framework, without trying, as I said, to obscure the continuing relevance of common law sources when appropriate, is evidenced in several sections of their work. Different types of situations put them to the task in that regard. One is when a conflict of interpretation arises within the civil law itself. Another is what to make of conflicting common law sources that may still exert some influence in Québec, despite the fact that some of them must now be characterized as prior law (droit
28 This point was emphatically made by Beetz J. in Cie immobilière Viger v. Lauréat Giguère Inc, [1977] 2 S.C.R. 67, and has since been reiterated in other cases, most notably, as far as corporate law is concerned, in Banque de Montréal v. Kuet Leong Ng, [1989] 2 S.C.R.. 429, where, as the authors point out, the court has found that the concept of reasonable person was broad enough to encompass the very strict ethical rules elaborated by common law courts. See: Crête and Rousseau, supra, footnote 1, at p. 453. In Cie immobilière Viger, the Supreme Court recognized on the basis of general principles of law the existence in the civil law of Québec of an action for unjust enrichment (de in rem verso) even though the Civil Code of Lower Canada was silent about it (the Civil Code of Québec now explicitly recognizes this action at arts.1493-96). In Kuet
Leong Ng, the Court’s decision relied upon the general principle of law to the effect that “bien
mal acquis ne profite pas”.
29 For a most interesting – and realistic -- account of the growing recognition of judge-made law as a source of law, see M. Delmas-Marty, Pour un droit commun (Paris, Seuil, 1994) at pp. 77 et
antérieur)30 because of the general characterization of business corporations as “legal persons established for a private interest” (personnes morales de droit privé).31 Indeed, some civil law rules that are now clearly applicable, to the exclusion of common law ones, are still open-textured to warrant forays into the law of other jurisdictions, be they civil law jurisdictions such as France or common law ones such as the other Canadian provinces.
An example of the former hypothesis is to be found in the debates about the interpretation of art. 317 of the Civil Code of Québec, which provides that “in no case may a legal person set up juridical personality against a person in good faith if it is set up to dissemble fraud, abuse of right or contravention of a rule of public order.” In essence, art. 317 codifies what is referred to in English as piercing the corporate veil, bearing in mind that art. 309 codifies for its part the principle of the limited liability of the members of artificial persons. The authors challenge the dominant interpretation of this provision, which is that it creates an autonomous source of liability for shareholders, independent of the general regime of liability applicable in Québec. They argue instead that this article does no more than what it says it does, that is, that it prevents the corporation’s legal personality from being set up against third parties, a rule that must be understood in the context of the general framework of civil liability.
Since art. 317 is only meant to operate in the context of a regular civil action, and thus cannot act as an independent source of civil liability, the person trying to shield herself (and her personal patrimony32) from the legal consequences of a fraud, an abuse of right or a contravention of a rule of public order by relying on the legal personality of the corporation used by her as a tool for performing her unlawful actions, will simply be prevented from doing so if she is sued under the normal rules of contractual or extra-contractual responsibility. From a civil law standpoint, the reasoning should be as
30 The authors use this expression at p. 225 in their discussion of the law governing the representation of the corporation towards third parties, a field of law where common law concepts were sometimes relied upon before the Québec National Assembly amended the Québec Companies Act and, later, the Civil Code so as to characterize the relationship between corporations, on the one hand, and their directors and officers, on the other, as a “mandate”, thereby leading to the application of the civil law of mandate as provided for in the Civil Code. 31 Civil Code of Québec, arts. 298 and 300.
32 The patrimony is a civil law concept that designates “[t]he whole of rights and obligations of a person having an economic or pecuniary value.” See P.-A. Crépeau, ed., Private Law Dictionary, 2nd ed. (Cowansville, Éditions Yvon Blais, 1991) at p. 311.
follows: (1) everyone is liable for his or her wrongful actions that cause injury to another; (2) exceptionally, the members of an artificial person are not liable for the wrongful actions of that person, the autonomy of which is legally recognized, unless it is proven that they have used that person to hide a wrong that can be attributed to them, and that this wrong constitutes (for art. 317 to find application) a fraud, an abuse of right, or a contravention of a rule of public order.
As the authors further note, the determining factor here is not that the wrong is hidden, but that the artificial person has been used to hide it, successfully or not, thereby creating a legal fiction where the artificial person merely becomes a legal tool devoid of any functional effectiveness.33 This means that art. 317 is essentially an exception to an exception, and should be treated as such. As a lower court ruling quoted by the authors puts it, this provision simply “unlocks the mechanism of immunity protecting the members of the artificial person”. It bears noting, however, that this mechanism can only be unlocked in an exhaustive number of situations set forth in art. 317. It is hoped that Crête and Rousseau’s interpretation of this provision prevail.
That being said, a further example is warranted to illustrate how they relocate Québec’s corporate law within a civil law framework while still acknowledging the relevance of common law sources. This speaks to the second hypothesis raised above, that is, when Québec jurists are faced with conflicting common law sources that may still exert some influence, without being directly applicable. In this context, there is probably no part of corporate law that has haunted Québec jurists more than common law fiduciary duties since, as a matter of principle, the concept of trust upon which they are based does not exist in the civilian tradition, although a civilianized version of it was recently introduced in the Civil Code of Québec.34
An interesting illustration of the way Crête and Rousseau relocate the question of the nature and scope of directors’ duties within a civilian framework is to be found in their discussion of the common law “proper purpose” doctrine, which, in essence, imposes purposive limits on how directors can exercise their powers. They note that there
33 Crête and Rousseau, supra, footnote 1, at p. 147.
34 For an interesting comparison between the common law trust and the civil law fiducie see M. Cantin-Cumyn, “La fiducie face au trust dans les rapports d’affaires”, in M. Cantin-Cumyn, ed.,
La fiducie face au trust dans les rapports d’affaires / Trust vs Fiducie in a Business Context ,
are two main approaches to this issue at common law, a stricter one emanating from Privy Council cases such as Hogg v. Crampton Ltd.35 and Howard Smith Ltd. v. Ampol Petroleum,36 and a more liberal one originating in the Canadian case of Teck Corp. v. Millar,37 which was itself criticized on this ground in another Canadian case, Exco Corp. v. Nova Scotia Savings & Loans Co.38 The authors ask themselves which approach, if any, should be adopted in the civil law context of Québec, further noting that both of these common law approaches have exerted some influence on the Québec case law.
In order to answer that question, they first have to determine whether the civil law imposes upon beneficiaries of a discretionary power a duty to respect the purpose for which this power was granted. Drawing on Madeleine Cantin-Cumyn’s seminal work on the management of the property of another39, Crête and Rousseau argue that a corporate director’s duty to adhere to the purposes for which a power is given is merely an aspect of the director’s broader duty of loyalty to the corporation. Moreover, imposing the former specific duty stems from the very notion of power itself, which is defined in civil law as a purposive prerogative (prérogative finalisée). An inherent limit is thus encoded in every power, and that very limit calls for the judicial review of improper uses of directors’ powers. Leaving aside the hypothesis of a radical absence of any power to act, which the authors also discuss, their main focus is on a corporate director’s use of a power for a purpose that is different from the main purpose for which that power was granted, a situation which is addressed in civil law by the doctrine of détournement de pouvoir – literally the highjacking of a power. In that hypothesis, the holder of the power remains within the objective limits of that power, but somehow distorts the ends for which the power was conferred.
Having identified a civil law duty to respect the purpose for which a power was granted, Crête and Rousseau still have to circumscribe the scope of that duty, which essentially implies examining the reasons underlying the use of a given power in light of the objectives pursued by the norm granting that power. Drawing on the rich literature
35 [1967] Ch. 254.
36 [1974] A.C. 831 (P.C.).
37 [1973] 2 W.W.R. 385 (B.C.S.C.). 38 (1987), 35 B.L.R. 149 (N.S.S.C.).
39 M. Cantin-Cumyn, L’administration du bien d’autrui, (Cowansville, Éditions Yvon Blais, 2000).
that exists on that topic in French civil law, they note that this examination first and foremost requires the identification of the end for which the power was granted, and, most importantly, that civilian doctrine “rejects . . . the approach which consists of identifying in a precise manner the purpose of a power”, but prefers instead “to conceptualize the purpose of powers more generally in light of the interests of their beneficiary . . . .”40 Returning to our original question, this means that of all the competing common law approaches at play, the one that would be the most relevant in the context of Québec’s civil law would be a liberal one allowing directors to exercise their powers for a plurality of purposes, as long as these purposes sustain the corporation’s interest. Under that view, a détournement de pouvoir would occur when there is no convergence whatsoever between the purposes inspiring the directors’ decision making process and the corporation’s interest; the mere presence of ancillary considerations that might have played a role in that process will not be fatal if the main purpose the directors sought to achieve could reasonably be deemed by them to serve the interest of the corporation. It is thus clear from the above, as Crête and Rousseau conclude, that it is the Teck approach that fits best with the civil law framework applicable to the improper use of a power.41
I believe this example demonstrates the authors’ rigorous approach to comparative legal analysis and their continuing openness to solutions emanating from other jurisdictions, albeit in a spirit of fidelity to the system that serves as the springboard for the comparison. In the context of Québec corporate law, even if the jus commune in that field is now clearly the civil law, there will always be a place for some degree of conversation between the civil law and the common law: it is sometimes a matter of law, it is often a matter of theory, and it is always a matter of pragmatism. But it may also be, first and foremost, a matter of attitude. Conversely, remote at best is the hypothesis of a court in a Canadian common law jurisdiction willfully considering the civil law’s position on a given legal issue so as to solve a conflict between competing common law approaches, and even opting in favour of one over the other on the basis of the support that this “foreign” body of law lends to the selected option42.
40 Crête and Rousseau, ibid., at pp. 500-01. My italics. 41 Ibid., at pp. 498-501.
As unlikely as it may seem, it should be recalled that until the mid-nineteenth century, the English law lords themselves were not hesitant to cite classical civilian authors such as Pothier.43 It could therefore be argued that a Canadian common law court that does the same would only revive part of its legal heritage. It would also enable Canada to establish itself as a pioneer in the development of a dialogical and, possibly, more integrated approach to corporate law. This is a challenge that Europeans are now tackling and that Canadian jurists, with the exception of a few scholars, have carefully avoided, in spite of socio-cultural circumstances eminently conducive to this type of intellectual endeavour.
It is probably true that there are more urgent corporate law issues that require resolution. Nevertheless, even granting this, this line of inquiry is important because it bears upon the configuration and working of the Canadian legal psyche. For example, how is the idea of Canada as a bijural jurisdiction to be understood? Does it simply imply that there are nine “pure” common law jurisdictions, one mixed jurisdiction (Québec), and a third one, consisting of the federal legal order, that is almost bicephal in nature, being generally regarded as a common law jurisdiction, but at the same time willing to accommodate the needs of the sole provincial jurisdiction that values its “mixity”?44 Or could it instead require an increased inter-traditional dialogue, at least at the federal level, a process that would clearly impose an obligation on the federal legal order to go beyond mere accommodation of the civil law tradition and wholeheartedly to
42 Admittedly, there might have been some exceptions here and there. One of the most interesting ones was the Supreme Court of Canada’s consideration of the civil law in its analysis of the status of pure economic losses at common law. See: Canadian National Railway Co. v. Norsk Pacific
Steamship Co., [1992] 1 S.C.R. 10.
43 See S. Waddams, Dimensions of Private Law: Categories and Concepts in Anglo-American
Legal Reasoning, (Cambridge, Cambridge University Press, 2003) at p. 6.
44 Alternatively, that federal legal order could be characterized as a pure common law jurisdiction as it concerns the nine common law provinces, and as a mixed jurisdiction as it regards Québec, and as far as federal statutory rules which do not refer to any provincial jus commune are concerned.
embrace it as its own, thereby leading to a recharacterization of the federal legal order as a mixed, or even a Métis45, one?46
Without going this far, could such a dialogue give rise to a common law rule of interpretation, more or less akin to the legislative one that recognizes the authority of both official languages in the interpretation of federal statutes47? This rule would provide that when a federal statutory provision has to be interpreted in a context that does not require reference to some provincial jus commune, and when the meaning of that provision is still ambiguous or not clear enough after resorting to ordinary rules of interpretation, a court of law must select among the alternative remaining interpretations the one that is most legitimate from a common and civil law perspective.48 It may very well be that in most cases the inquiry will not need to go this far since other tools may be available to solve the interpretive dilemma. However, it may make a difference in some other cases.49 Even granting this possibility, of all the solitudes that have been said to 45 On the idea of a métissage as the appropriate paradigm to sustain a genuine dialogue between legal traditions, and, especially, between the common law and the civil law, see: N. Kasirer, “Legal Education as métissage”, (2003) 78 Tulane Law Review (forthcoming), on file with the author.
46 The dualistic, rather than dialogical, orientation of rules of federal statutory interpretation, and the accommodation logic inspiring the philosophy underlying these rules, is evidenced by s. 8.2 of the Interpretation Act, supra, footnote 24, which reads as follows: “Unless otherwise provided by law, when an enactment contains both civil law and common law terminology, or terminology that has a different meaning in the civil law and in the common law, the civil law terminology or meaning is to be adopted in the Province of Québec and the common law terminology or meaning is to be adopted in the other provinces.”
47 See Official Languages Act, R.S.C., 1985, c. 31, 4th Supp., s. 13.
48 Such a rule of interpretation, which in passing would not contradict s. 8.2 of the Interpretation Act, would not require Canadian lawyers to be formally trained in both the civil law and the common law. It would only require from them an increased openness to the other legal tradition, as well as a will to learn, by themselves or through continuing education, about the structure of reasoning and the fundamental concepts in that legal tradition.
49 For example, a serious argument could be made that the case Théberge v. Galerie d’art du
Petit-Champlain Inc., [2002] 2 S.C.R. 3 is one of those the outcome of which could have been
different had such a rule of interpretation existed. This case dealt with the interpretation of some provisions of the Copyright Act, R.S.C. 1985, c. C-42, and pitted the three Québec Supreme Court judges against four of their common law counterparts on the interpretation to be given to an author’s economic rights that the Act recognizes. Binnie J., writing for the majority, reiterated the sharp distinction traditionally established in common law jurisdictions between the economic rights (the rule) and the moral rights (the exception) of the author, and opted for an interpretation of these economic rights totally impermeable to broader considerations pertaining to the author’s moral rights. This view was opposed by his three Québec counterparts. Although a serious argument could be made that a “pure” common law approach did not necessarily warrant the outcome as decided by the majority, what is more interesting in Binnie J.’s judgment is that it highlights - and, admittedly, this is my subjective reading - the limits of the “logic of
exist in Canada, the most enduring one is probably the solitude that exists between the common law and the civil law50. Professors Crête and Rousseau have accomplished a remarkable feat in showing us how, in the unusual context of an introductory textbook on corporate law, bridges can be built between these two traditions without compromising the coherence of either one.
accommodation” described above, which views the Canadian legal order as a common law one (see, in particular, paras. 62-72) which accommodates a juridical anomaly, that is, Québec, and which exceptionally draws inspiration from the civilian tradition, such as in the Copyright Act’s provisions recognizing the moral rights of the author, in which case that exception has to be construed restrictively. Suffice it to say that I consider this judgment to be extremely unfortunate from the standpoint of the establishment of a genuine dialogue between the common law and the civil law traditions in the interpretation of federal statutory law, a dialogue that could lead, in some cases, to an intersubjectively legitimate métissage. It is also a missed opportunity to elevate the Canadian judiciary to the rank of a leader in the current debate about the globalization of private law. A similar comment could be made about the Supreme Court’s take on maritime law, as expounded in cases such as ITO-International Terminal Operators v. Miida Electronics Inc., [1986] 1 S.C.R. 752, and Q.N.S. Paper Co. v. Chartwell Shipping Ltd., [1989] 2 S.C.R. 6, and to a lesser extent, Ordon Estate v. Grail, [1998] 3 S.C.R. 437, where this field of law, as a federal body of rules independent of the ten provincial jus communes, was ontologically viewed as a common law one, and this, even in Québec where, for example, civil law rules of extra-contractual liability are displaced by a common law framework that is unknown to most lawyers and citizens, thereby raising a further problem of legitimacy that, I regret to say, is not entirely unlike the one that arose when, in the Royal Proclamation of 1763, the British Crown imposed upon the residents of the newly-constituted Province of Quebec a private law framework that was unknown to them. It might be that this segment of federal law is more historically linked to the common law (although, as McLachlin J. pointed out in her opinion in the Chartwell Shipping case, the common law pertaining to maritime law has itself been heavily influenced by international law and civil law), but, in any event, the alleged need for uniformity across Canada in that field did not necessarily warrant privileging one legal tradition and erasing the other. Maritime law and intellectual property law are indeed fields where the need for some pan-Canadian uniformity is justifiable, but the means by which the desired uniformity is achieved does not have to be a zero-sum game where one wins and the other loses. A strong argument can thus be made that these are areas of law where cross-cultural legal aspirations should probably weight more than considerations pertaining to the genealogy of these areas of law, especially if one considers that the genealogy of any field of law is often quite complex, rarely univocal, and sometimes reflect a logic of métissage rather than one of purity. Most importantly, we are talking here about autonomous federal fields of law. So maybe this in itself is a context where, as a matter of judicial policy, métissage should be recognized as the dominant interpretive paradigm. 50 This is true even if one considers the otherwise laudable efforts made by the Parliament of Canada to de-essentialize, through the Federal Law-Civil Law Harmonization Act, S.C. 2001, c. 4, language-based understandings of the common law and the civil law, by somehow recognizing the existence of at least four legal sub-traditions in Canada, that is, the civil law in French and in English, and the common law in French and in English. This is still a far cry from legal
4. On the theoretical dimension of the book: the textbook as a tool for the establishment or perpetuation of doxae?
This last section of my review of Raymonde Crête and Stéphane Rousseau’s text could have been ironically entitled “Québec corporate scholarship goes Midwest”. Indeed, after having noted the decidedly positivistic tone of corporate law scholarship in Québec, Crête and Rousseau clearly want to depart from that approach by embracing that of law and economics, the juridical progeny of which is now referred to as the Chicago school of economics. Moreover, finding Québec scholars’ ignorance or indifference to law and economics problematic, they advocate a reception of that theory into Québec legal thought, which, according to them, does not prevent respect for the specificities of corporate law in a civil law context.51 The qualities of law and economics as a context-provider for the analysis of corporate law also explain their choice.
Crête and Rousseau are right on all of these counts. It can hardly be disputed that, indeed, Québec corporate law scholarship has been characterized by a certain acontextual positivism that can only be enriched by a deeper look at the economic rationales underlying decision-making processes in commercial settings. They are also correct in emphasizing the significant heuristic value of law and economics, and in deploring the minimal impact it has had so far on corporate law scholarship in Québec. It bears noting in passing, however, that this marginal status of law and economics is more or less the same in the rest of the francophone world, despite some progress in the last decade partly due to other Québec scholars.52
Although it is not possible in the context of this review to analyze fully the reasons explaining this situation, one can hypothesize about the language barrier (given
51 Crête and Rousseau, supra, footnote 1, at p. 63.
52 For instance, what probably deserves now to be characterized as the leading monograph in French on the economic analysis of the law, approached from the standpoint of a jurist rather from that of an economist, was recently published in Brussels by Université de Montréal’s professor Ejian Mackay. See E. Mackay, L’analyse économique du droit, (Brussels, Bruylant, 2001). As well, it is a Québec scholar, Yves-Marie Morissette, formerly of McGill University, and now a justice on the Québec Court of Appeal, who has recently translated for the Presses Universitaires de France, Ronald Coase’s most important articles which were until then unavailable in French. See R. Coase, Le coût du droit, (Paris, Presses Universitaires de France, 2001). Lastly, see T. Kirat, Économie du droit (Paris, La Découverte, 1999).
that the bulk of the literature available on law and economics is in English53), the fact that economics has not achieved in continental Europe and in Québec the kind of dominance in the social sciences it has in the Anglo-American world, the set of common law references and assumptions found in most of the relevant literature, the presence of competing theories, and, more generally, a socioeconomic ideology that is probably less overtly, if not less enthusiastically, capitalistic than in the United States of America, the birthplace of law and economics. The context-specific dimension of several important works in the field of law and economics is not lost sight of by Crête and Rousseau who, following the lead of scholars such as Ron Daniels and Jeffrey MacIntosh,54 recognize that the American origins of that theory may distort the analysis in other contexts, and thus critically apply the theory’s analytical framework so as to ensure that the specificities of the Canadian market are given due consideration. Such sensitivity to context, which first and foremost evidences the authors’ intellectual rigor, is to be commended.
While Crête and Rouseau offer their readers a truly excellent summary of the basic tenets and trends of law and economics in their first chapter,55 it must be noted that this theoretical framework permeates the whole book: general topics as well as specific rules are scrutinized through the prism of the economic analysis of the law.56 Such an 53 While English is clearly not a problem for Québec scholars and thus cannot be counted as a possible excuse for ignoring law and economics, the same is not true with respect to francophone jurists from Europe, especially from France.
54 See R.J. Daniels and J.G. MacIntosh, “Toward a Distinctive Canadian Corporate Law Regime”, (1991) 29 Osgoode Hall L.J. 863.
55 Crête and Rousseau, supra, footnote 1, at pp. 60-100.
56 However, some interesting issues escape such scrutiny, possibly because they were not deemed central enough in the context of an introductory textbook. For example, in their treatment of the law governing dividends, Crête and Rousseau excerpt the case McClurg v. Canada, [1990] 3 S.C.R. 1020, on the legality of discretionary dividends, but, regrettably, merely ask their readers if they believe the case to have been correctly decided, after having noted that Dickson C.J.’s majority judgment and La Forest J.’s dissenting judgment illustrate two equally fundamental, but different, approaches to the regulation of business corporations (see Crête and Rousseau, supra, footnote 1, at p. 383). One would have hoped a more thorough analysis of this case from a law and economics standpoint, especially in light of the nexus of contracts theory. So is the case with their discussion of the constitutional framework applicable to corporate legislation, where they note that securities legislation has been found to give rise to the application of the double aspect doctrine, which thus allows both levels of government to legislate over this topic (p. 184). It is surprising, however, to see them remain uncommitted with respect to the current debate on Canada’s patchwork system of securities regulation. It is all the more surprising given their adoption of the law and economics approach which can certainly provide interesting insights as to
approach is perfectly understandable in light of the authors’ wish that this framework be received in Québec. But, as useful and instructive as economic analysis of law can be, and as legitimate as the choice of that theoretical framework is, a blanket application of that grid in an introductory textbook is not, I believe, entirely unproblematic. I shall explain myself in the next few pages.
Professors Crête and Rousseau correctly remark that the economic analysis of law has become the dominant paradigm in Anglo-American corporate law scholarship and, interestingly, use the word “adherence” (adhésion) to refer to people’s attitudes towards it. They further note that this power of attraction of economic analysis of law is partly due to its “aptitude at reinforcing traditional legal doctrine by offering jurists a method by which they can rethink the role of legal institutions and highlight their economic consequences”.57 In that context, they point to what they call the two fundamental postulates of the economic analysis of law. The first one is that individuals act rationally when they make choices, and the second is that individuals are presumed to make decisions in view of maximizing their self-interest, broadly defined as encompassing their well-being, their wealth or their utility. In other words, they emphasize the centrality of rational choice theory for law and economics.58 In that vein, they acknowledge the peculiarity of the notion of rationality that is employed in the economic analysis of law, where rationality essentially designates the ability and propensity to use instrumental reason to make decisions.59 The rational choice model is thus focusing on process rather what system would be optimal in the specific setting of a federation. The fact – it is on purpose that I use the word “fact” here - that a “national”, federally-administered, system of regulation would be a no-go for Québec might explain their silence.
57 Crête and Rousseau, supra, footnote 1, at p. 61.
58 It should be noted that other postulates can be identified as inspiring rational choice theory. In a recent book about the epistemology of that theory and other related or competing ones, French sociologist Raymond Boudon identifies the following ones: (1) methodological individualism; (2)
understandability of individual actions, decisions, attitudes, behaviour, and beliefs; (3) rationality
(broadly conceived) of individual actions, decisions, attitudes, behaviour, and beliefs; (4)
instrumentalism (individual actions may be explained in light of their anticipated consequences);
(5) egocentrism (individuals are primarily interested in the consequences of their actions to the extent they are themselves affected by these consequences); (6) optimization (individuals will select a certain option if that option seems more likely than other competing ones to maximize their individual benefit when compared with the potential inconveniences of the option selected). Boudon further notes that some of these postulates can be described as assumptions while others can be more aptly designated as gambles. See R. Boudon, Raisons, bonnes raisons (Paris, Presses Universitaires de France, 2003) at pp. 19-22.
than outcomes. Because of this focus on the decisional process, the authors contend that the law and economics’ adoption of the rational choice theory is neutral, as it does not purport, at least initially, to explain individual preferences or to demonstrate that some choices are better than others.60 Moreover, to their credit, they acknowledge the limits of the rational choice model, be they related to the bounded rationality phenomenon, or to the abstract nature of the ideal-typical rational individual it uses as its intellectual springboard. They further recognize that this model is not necessarily always representative of the actual behaviour of socio-economic actors;61 let me add in passing that, as a theory, it does not have to show such a high level of representativeness to be valid.
The authors also correctly note the utilitarian nature of the law and economics model, which posits efficiency as the determining factor in the analysis of the allocation of (scarce) resources. In that context, they point to the two different types of economic analyses of law that have emerged, descriptive and normative. They highlight the important heuristic value of the descriptive economic analysis of law as a tool for identifying and explaining the unanticipated consequences of legal rules.62 They also accurately describe the basic tenets of the normative strand of economic analysis of law, which seeks to promote efficiency as the fundamental objective in the elaboration of legal rules.
They do mention in passing that critiques have been formulated against the use of efficiency as the ultimate normative factor, notably the critiques arguing that justice and equity, rather than efficiency, should inspire legal norms.63 Throughout their book, they make similar acknowledgements here and there. But in the end it is not entirely clear where they themselves stand in respect of the type of economic analysis they pursue. In some sections of their book, they seem to adopt the normativist creed about efficiency, for example when they reiterate that the business corporation’s sole objective is wealth maximization.64 However, in other sections, they appear more critical of the 60 Ibid., at p. 66.
61 Ibid., at p. 67. 62 Ibid., at pp. 70-72. 63 Ibid., at p. 74.
64 For example, ibid., at p. 395, when they say “The role of corporate law, [in the perspective of coordinating the diverse resources of the corporation in view of maximizing its worth], is to ensure that the board of directors be in a position to adequately perform this task.”, or, id., at p.
consequences of that creed, for example when they refer to the fate of actors who are forgotten by corporate law, such as employees,65 or when they show some sympathy toward the expansion of the number of stakeholders to be taken into consideration by directors in the context of the performance of their fiduciary duties, as was advocated by the trial judge in Peoples Department Stores Inc.66 Moreover, they generally make very effective use of the descriptive economic analysis of the law. That being said, while Crête and Rousseau must be commended for their honesty in acknowledging the existence of alternative views to the law and economics model, by only mentioning in passing the critiques of that model, especially in its normative form, they end up marginalizing them, thereby reinforcing the current doxa in North American corporate law scholarship.67
The concept of doxa, elaborated by sociologist Pierre Bourdieu, designates beliefs so deeply internalized by social actors that they operate in a more or less unconscious manner, without any need to be expressly justified anymore.68 A doxa differs from an orthodoxy precisely in that the dogma inspiring the latter, not being as deeply ingrained in the psyche of social actors, needs to be iterated and reiterated in more explicit and formal ways. Moreover, these very iterations and reiterations are to some extent regulated by those, whoever they are, who have both a vested interest in ensuring conformity to the dogma and the means to impose it. The passage from an orthodoxy to a doxa can thus be explained in epistemic terms as the transformation of a construct – a possible explanation or justification which might have, and generally has, a dogmatic character – into a given – a former explanation or justification that is now treated as a fact, the existence and truth of which is hardly challengeable, even though it is at best an
744, when they say “if we consider the business corporation as a nexus of contracts between parties in view of maximizing the worth of the company . . . .”
65 Ibid., at p. 415.
66 Peoples Department Stores Inc. (Re) (1998), 23 C.B.R. (4th) 200 (Qué. S.C.), reversed by the
Québec Court of Appeal at (2003), 41 C.B.R. (4th) 225. On 28 August 2003 the Supreme Court of
Canada allowed the application for leave to appeal: [2003] S.C.C.A. No. 133.
67 Ten years ago, Anthony Kronman was already characterizing the influence of law and economics in the American legal academia to a “central, if unrecognized, orthodoxy”. See A. Kronman, The Lost Lawyer. Failing Ideals of the Legal Profession (Cambridge, Mass., The Belknap Press of Harvard University Press, 1993) at p. 226. Precisely because it is often unrecognized, I deem it more appropriate to refer to it as a doxa rather than as an orthodoxy. 68 Bourdieu describes a doxa as “a silent belief that does not require justification.” See P. Bourdieu, Homo academicus (Paris, Minuit, 1984), at 153. For an English-language piece addressing, inter alia, the operation of doxae in the field of law, see generally P. Bourdieu, “The Force of Law: Towards a Sociology of the Juridical Field”, (1987) 38 Hastings L.J. 805.
ideal reality.69 As such, the concept of doxa refers to an ideology that has achieved the highest degree of success possible.
There are obvious limits to the use of a concept such as that of doxa. Indeed, some, including Bourdieu himself, have used it in such a deterministic manner that it is as if socio-economic actors were somehow deprived of their subjectivity, and thus of their capacity for a rational evaluation of intellectual propositions, as a result of immanent socio-cultural forces that are beyond their control and that act in spite of their will. As sociologist Raymond Boudon points out, such a view is problematic, firstly, because it ignores the subjectivity of these actors, and, secondly -- and it is a corollary of this ignorance of their subjectivity -- because it relies on a theory in which causation is reduced solely to material causation, that is, to phenomena that are external to the subject. However, as he further notes, a certain behaviour may result not only from material processes acting beyond the knowledge of the subject, but also from reasons, more or less conscious, that are internal to that subject.70
But even bearing in mind this important limit to the concept of doxa, and the need to acknowledge the importance of individual subjectivity there is still some heuristic value to that concept, most notably in that it directs us to the question of socialization processes. If a doxa is successfully established, it can only be the result of a process by which socio-economic actors have been socialized. However, they are not socialized in general;71 they are socialized by institutions, through the transmission of values or beliefs, in their family, at school, or within their groups of peers. And they are socialized by concrete means or persons: sanctions imposed upon them at school or in their family, the rabbi’s teachings or the priest’s sermon, popular culture, home works and, yes, legal textbooks.
69 In a nutshell, the concept of ideal reality (réalité idéelle) designates representations that permeate one’s consciousness to the point that these representations end up being assimilated to actual realities. See M. Godelier, L’idéel et le matériel: pensée, économies, sociétés (Paris, Fayard, 1984).
70 R. Boudon, supra, note 55, at p. 15.
71 It is indeed important to realize that an explanation that contents itself with simply saying that a given behaviour is the result of an individual’s socialization actually does not explain anything. It merely remarks “the existence of correlations for example between the characteristics of the education received by a group of individuals and their behaviour, without saying anything about the nature of the mechanisms underlying these correlations.” (translation) See R. Boudon, ibid., at p. 11.
And this is precisely where my main – and probably only -- point of contention with Crête and Rousseau’s textbook lies. A textbook is an instrument of socialization of future lawyers, which means that the theoretical approach chosen by its authors risks being the one adopted by the students who will use it. In other words, they might end up conceiving of a whole field of law through the lens of the theoretical approach adopted in that textbook. It does not mean that they are condemned to adhere forever to that theoretical approach, as they will continue to develop themselves intellectually, but it is probably fair to hypothesize that a first exposure to a whole field of law through any theoretical approach will leave a significant, almost prescriptive, imprint in the minds of many of them. Although I acknowledge that such a type of socialization is inevitable and that, in any event, law students need to be socialized to their discipline in one way or another, it is my belief that an introductory text should strive as much as possible to alleviate the potentially perverse effects of socialization through a theoretical approach that is presented in a quasi-hegemonic manner, whatever that theoretical approach might be.
I am not sure that Professors Crête and Rousseau have entirely succeeded in this respect. Indeed, their otherwise legitimate choice of the law and economics model as their main theoretical framework soon becomes problematic given the very small space they allow competing approaches.
First, their relegation of competing theories to a few paragraphs and some footnotes is questionable from a critical and historical standpoint. As a consequence of their adoption of the law and economics model, they unsurprisingly subscribe to the definition of the firm as a nexus of contracts. I shall comment on this definition and its normative consequences later. However, in so doing, the authors fail to examine competing theories that they refer to as being outside the scope of the first edition of their book. This is what they say, for instance, of theories advocating that corporate law should take into account the interests of all those who have a stake in the firm rather than only those of the shareholders envisaged as residual claimants, as proponents of the nexus of contracts theory would argue.72 And what about theories that contend that firms should act in a more socially responsible manner, given the negative externalities that they often
