Datio in Solutum

The consequence of late classical constitutions such as Alex. C. 8.34.1, which prescribe an execution sale, was, according to some modern authors, that at this time forfeiture arrangements became invalid/⁸ There are, however, quite a few texts on a transfer in lieu of payment (datio in solutum) of the pledged property to the creditor.

Alex. C. 8.34.1

The most significant text for the legal validity of a constructive forfeiture arrangement in the form of a datio in solutum of pledged property is the con­stitution of Alexander Severus of 222 ad.

Alex. C. 8.34.1. Qui pactus est, nisi intra certum tempus pecuniam quam mutuam accepit solveret, cessurum creditoribus, hypothecae venditionem non contraxit, sed id comprehendit, quod iure suo creditor in adipiscendo pignore habiturus erat. communi itaque iure creditor hypothecam vend­ere debet.

A person who agreed that, unless within a fixed time he repaid a loan he received, he would yield (pledges) to his creditors, did not contract the sale of a hypothec, but achieved (only) what the creditor would rightfully have (anyway) in getting the pledge.

In the case giving rise to this constitution, the parties envisaged in all prob­ability a conditional transfer in lieu of payment, although the constitution initially views it as an (invalid) sale of the pledged objects to the creditor. The constitution rules that what the parties had agreed was ineffective: the creditor must sell the pledged property to third parties by way of execution. A con­structive forfeiture arrangement in the form of a datio in solutum of pledged property to the creditor is recharacterized into a power to sell to third parties. This constitution indicates that at the end of the classical period a constructive forfeiture arrangement in the form of a transfer in lieu of payment based on default was ineffective to transfer ownership to the creditor himself. The reason for this may have been that it is inherent to this type of clause that any surplus value in the pledged property would benefit the creditor rather than the debtor.^{[1256] [1257] [1258] [1259] It is not without reason that this constitution, together with Constantine's prohibition of leges commissoriae in C. 8.34.3, was later included in the Codex title on forfeiture clauses?3}

Protection of the debtor against ‘usurious exploitation’?

There is a constitution from Alexander Severus from 230 ad, from which it appears that a sale or datio in solutum of the pledged object to the creditor taking place after the secured debt became due and payable is perfectly valid.44 If the creditor and the debtor choose to transfer the pledged property in lieu of payment when the loan becomes payable, no conditional forfeiture arrangement based on default exists. From the legal sources it can be derived that in late classical law an invalid forfeiture arrangement is aimed at a default which might possibly occur in the future. If the acquisition of the charged object is the result of an agreement which has been concluded only after the occurrence of the default, then this characteristic is missing and a valid acquisition exists?⁵

In C.

Diocl.-Max. C. 8.13.13. Cum dominam non minorem viginti et quinque annis ea quae obligaverat tibi iure dominii possidere permisisse et in solu­tum dedisse precibus significes, dominae contractus et voluntas ad firmi­tatem tibi sufficit.

Since you indicate in your petition that a sui iuris woman over age twenty- five allowed you to possess as owner the property that she had pledged to you, and she gave it as payment, the owner's contract and wish provides suf­ficient confirmation.

According to some modern authors this text serves as an indication that, in the case of a valid forfeiture arrangement, no imperial permission was neces­sary for appropriation (impetratio dominii).^[1260] While not precluding this inter­pretation, Peters deems a different explanation to be more plausible. He seeks to explain this by the fact that in this case there is no reason to fear a ‘usurious exploitation' of the debtor. The fragment sounds, according to Peters, as if, by way of exception, the debtor was in a stronger position here: it was not the debtor who was concerned about her position but the creditor.^{[1261] [1262] I am more inclined to regard the validity of the datio in solutum as a consequence of the fact that it took place after the secured debt became due and payable. In later times (and still today) this is considered less onerous than a forfeiture arrangement concluded at the time of granting?8}

Invalidation for other reasons

There are texts in which a datio in solutum of pledged property was con­sidered invalid, but for entirely different reasons than protecting the debtor against ‘usurious exploitation'. Ulpian D. 46.3.45 concerns a case where a hus­band promised his wife that, in the event of dissolution of marriage, he would transfer the pieces of land, which he had pledged for the return of her dowry, in lieu of payment to her.