Page 26 - Jewish Book Annual Volume 27

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R E C E N T R E S P O N S A L I T E R A T U R E
ON MODE RN P R O B L EM S
By
S
olomon
B.
F
reeho f
T
h e b u s in e s s c o r p o r a t i o n
has become a standard phenomenon
in modern economic life, and the ownership of stock in
these corporations is widespread. Therefore both modern
and Jewish law must deal with the problems involved in the
business of the corporation and the status and rights of its stock­
holders.
It is much easier for modern English or European law to deal
with the question of corporation and stockholders than it is for
Jewish law. One reason is that the corporation has its origin in
the Roman Collegium. The Collegium had all the main charac­
teristics of the modern corporation. It was a distinct, legal personal­
ity. It could own property and incur debts. Those who participated
in the Collegium (corresponding to our modern stockholders)
were not liable for its debts, and were not the direct owners of
its property. But Jewish law had no provision for the corporation
and does not seem to know of it. It knows only simple partner­
ships in which the partners actually owned the joint property
and were liable for the debts of the partnership.
Beyond the fact that there is no clear precedent in Jewish
law for the corporation, there is a still more fundamental reason
why it is much more difficult for Jewish law than for general law
to deal with this and similar modern problems. In the American
legal system, for example, when an entirely new social situation
arises such as the one we are discussing, or the prevalence of
automobiles, or a widespread sale of deadly weapons, the legislature
of any state or the Congress of the United States can pass a new
law to deal with the new social situation. In Jewish law, how­
ever, the possibility of making a new, unprecedented legislative
decision is virtually impossible. A synod of rabbis might occasional­
ly proclaim a decree (takkanah) to meet some special difficulty,
but a regularly constituted legislative body does not exist in
the present-day Jewish legal system. It had ceased to exist with
the cessation of formal ordination in the fourth century and in
the non-existence of a Sanhedrin which could be a truly legis­
lative body.
Thus, in a basic sense the Jewish legal system is an incomplete
one. It lacks the chief creative instrument of all modern legal
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