Monday, September 27, 2004
I just finished reading a very interesting paper by USC law and economic professor Timur Kuran, Why the Islamic Middle East Did not Generate an Indigenous Corporate Law.
ABSTRACT: Classical Islamic law recognizes only natural persons; it does not grant standing to imagined, juristic persons. This article identifies self-reinforcing processes that kept Islamic law from developing a concept of legal personhood indigenously. Community building being central to Islam's mission, the early promoters of Islam had no use for a concept liable to facilitate factionalism. In subsequent centuries the typical Muslim-owned commercial or financial enterprise was too small, and too limited in scope, to justify lobbying for advanced organizational forms; and Muslim rulers made no attempt to supply the corporate form of organization, because in the absence of merchant organizations they saw no structures worth exploiting for their own ends.The argument is quite interesting in general, but I found it especially useful because it addresses some work I've been doing on the role theology played in the development of the modern Western corporation. Today, of course, we regard the corporation's legal personhood as little more than a useful legal fiction. But where did the concept of a juristic person come from? I believe that the Christian doctrine of the Church as the Bride of Christ made it possible to conceptualize an entity that initially had a morally and then later a legally cognizable existence separate and distinct from its members. The question, of course, is whether this history (assuming I'm right) has any continuing legal content other than being a useful fiction. At the moment, I'm not convinced it does. Concepts of a real corporate personhood strike me as far too mystic to be useful in legal scholarship. But I'm prepared to be corrected.