A. The Property Model in German Civil Law

Beginning with the approach taken by German law, it is worth noting from the outset that the distinction it draws—that is, the distinction between the contract as an obligation to transfer property, and the actual transfer of property itself—is largely reminiscent of that recognised by Roman law. ^{Footnote 13} Indeed, most scholars understand Roman law to have drawn a similar distinction between the obligations created by contract, on the one hand, and the transfer of property, on the other. ^{Footnote 14} In the case of a sale, the only right that could be conferred upon a purchaser in Roman law was thus a personal one for breach of performance—by which was meant, in effect, failure to physically deliver the thing in question. ^{Footnote 15}

In other words, Roman law can be said to have obeyed a largely proprietary conception of the transfer of property by contract, in which the contract itself was never sufficient on its own to pass title from a vendor to a purchaser. The actual transfer of property rights required that the parties comply with an entirely separate mechanism—in most cases the traditio, by which the property to be transferred was delivered to its intended recipient. ^{Footnote 16} To the extent that it conforms to this general Roman approach, German law can thus be understood to reflect a proprietary conception of transfer by contract in its own right, thereby limiting what the parties to a contract can accomplish by the effect of their consent alone.

An agreement to transfer property under German law will thus require an additional step in order to actually transfer the property in question. In the case of movable property, this means essentially complying with the Roman law notion of traditio by delivering the property in question to the person acquiring it. ^{Footnote 17} As article 929 of the BGB, which deals with the transfer of movable property, provides:

Following this provision, only a real contract, in which agreement and delivery have occurred at the same time, can ever have the effect of properly transferring movable property. ^{Footnote 19} Indeed, German law goes so far as requiring an additional real contract to complete the transfer where the original agreement between the parties is purely executory. ^{Footnote 20} Where the intended acquirer is already in possession of said property, however, the existence of an agreement between the acquirer and the original owner is sufficient to constitute such a contract, and thus effect a valid transfer of the property in question.

The requirement of a real contract is even more explicit in the approach that German law takes towards the transfer of immovable property, which instead mandates compliance with title registration. While different from delivery, this requirement is meant to ensure essentially the same thing, namely that the transfer of property is completed in a way that is at least knowable by all parties potentially concerned. As article 873 BGB, which sets out the requirements pertaining to immovable property transfers, provides:

1. (1) The transfer of the ownership of a plot of land, the encumbrance of a plot of land with a right and the transfer or encumbrance of such a right require agreement between the person entitled and the other person on the occurrence of the change of rights and the registration of the change of rights in the Land Register, except insofar as otherwise provided by law.

2. (2) Before the registration, the parties are bound by the agreement only if the declarations are notarially recorded, or made before the Land Registry, or submitted to the Land Registry, or if the person entitled has delivered to the other person an approval of registration that satisfies the provisions of the Land Register Code [Grundbuchordnung]. ^{Footnote 21}

As per the provision above, the agreement to perform the transfer of immovable property is not binding unless the parties have at least taken steps towards the registration of the property transfer. German law thus provides the parties little choice but to conclude two separate contracts, only the second of which actually results in the transfer being completed. The first amounts to an executory agreement that binds the seller to transfer the property in question at some point in the future. ^{Footnote 22} The second, real contract is then concluded at the same moment that registration—and thus the transfer of the immovable property—occurs. ^{Footnote 23}

In other words, German law requires that the transfer of both movable and immovable property be accomplished by completing what are essentially formalities pertaining to the publication of rights. In both cases, a purely executory contract is never sufficient to accomplish this, and will need to be supplemented (where such an executory contract has intervened between the parties) by an additional agreement to actually transfer the property by complying with the requisite transfer requirement—that is, with delivery in the case of movable property, and registration in the case of immovable property.

This approach to the transfer of property by contract offers at least two distinct advantages, one practical and the other theoretical. On the practical side, its main advantage is to render the actual transfer of property separate from the original contract, and thus potentially valid even if the latter is struck down. ^{Footnote 24} This approach bears at least superficial similarities to the Torrens title registration systems that have been adopted across much of the Commonwealth. ^{Footnote 25} In fact, it is arguable that at least two of the main innovations of Torrens title systems—that is, the guaranteed security of title and the purging of any existing defects in the title chain—effectively require the recognition of something like the German separation and abstraction principles. ^{Footnote 26}

Meanwhile, the main theoretical advantage presented by the German approach to the transfer of property by contract lies in its being effectively proprietary, and thus fully cognisant of the in rem dimensions of the property being transferred. Accordingly, the existence of an agreement does not dispense with the need to account for the potentially erga omnes effects of the transfer itself. Just as these effects require that the unilateral acquisition of property be accompanied by an objective demonstration of the intention to acquire it, so too must an acquisition by way of agreement be manifested in a way that is knowable by all parties who may be concerned—even those who are outside the agreement. ^{Footnote 27} In principle, German law thus treats this secondary form of acquisition in the same way as the unilateral acquisition of ownerless property. ^{Footnote 28}

By contrast, the main disadvantage of the German model is a mirror image of its main benefit, namely that it limits what can actually be accomplished by way of contract. Indeed, the parties to a contract can never actually transfer ownership or even lesser property rights except through compliance with either delivery or registration, as the case may be. This poses an important theoretical difficulty from the agreement-based perspective of French law, which conceives of the contract as essentially a law devised by the parties themselves. ^{Footnote 29} It also creates a similar problem from the perspective of property law itself, in the sense that these ostensibly public law requirements appear at first glance to restrain the free disposition of property. ^{Footnote 30}

Beyond these more theoretical issues, German law itself also recognises a number of practical difficulties that are also created by this arrangement. Accordingly, it allows the parties to a transfer of movable property—though not immovable property—to stipulate that delivery has been effected even if it has not actually occurred in practice. ^{Footnote 31} In so doing, the parties to the transfer of movable property are thus allowed to effectively circumvent compliance with requisite formalities in a manner that echoes similar developments in the later stages of Roman law. ^{Footnote 32} However, the broader theoretical framework remains intact, and the parties continue to be constrained in the manner and circumstances in which they can properly stipulate the completion of delivery in this way.

B. The Contractual Model in French Civil Law

Having argued that German law takes a largely proprietary approach to the transfer of property by contract—according to which the actual transfer of property is subordinated to the completion of external, publicly knowable formalities—my focus now shifts to the second of the two major models of transfer by contract known in the civilian legal tradition. This second model, which is represented first and foremost by the approach taken in the French legal system, can instead be understood to emphasise the contractual dimensions of the transfer of property. In this respect, it largely follows the agreement-centered approach of the early modern natural law scholars, who, having established the freedom to alienate one’s property as an essential aspect of ownership, saw contract as the means through which such an alienation would normally proceed. ^{Footnote 33}

Accordingly, some French legal scholars have positioned their own legal system, based on the Code civil of 1804, between “ancient” legal systems, on the one hand, and “modern” legal systems, on the other. ^{Footnote 34} What is implied by this, at least in respect of the transfer of property by contract, is that modern French law adopts a contractual model that differs both from what came before it, and from those legal systems that later emerged separately out of the original Roman sources. The former is comprised of both Roman law and the customary laws that governed parts of France until the French codification in 1804. ^{Footnote 35} The latter, meanwhile, refers to those legal systems that follow the German BGB, itself strongly influenced by the German historical school’s work on Justinian’s Corpus Iuris Civilis. ^{Footnote 36}

The main difference between these respective approaches—that is, between the contractual model exemplified by French law and the proprietary model exemplified by both Roman and German law—is that French law understands all contracts, be they real or executory, as transferring in rem rights alongside, but in a manner that remains distinct from, the conferral of in personam rights under the contract itself. This particular feature of French law is generally called the “solo consensu” or consent-only principle. ^{Footnote 37} The default rule it lays out is one in which property is transferred to its acquirer by contract as soon as it is possible for it to do so—usually meaning the moment that the contract itself is concluded and in personam rights arise between the parties, without the need to accomplish additional formalities. ^{Footnote 38} Since the transfer of property occurs by contract, however, the parties are always free to determine when property passes in their agreement. They are not bound by the public requirements of property rights in the same way that they would be under the German law. ^{Footnote 39}

That being said, the French approach presents an important complication in respect of the ability to actually enforce the property rights transferred by contract against third parties. Indeed, the ability to enforce these rights outside of the immediate transaction is subject to essentially the same formalities as German law—that is, the delivery requirement for movable property, and registration for immovable property. As article 1198 of the Code civil provides:

In other words, while French law purports to fully recognise the transfer of property by agreement alone, it can properly be said to apply only a relative version of this principle once the above exceptions are taken into account. Rather than constituting a full in rem right in the Hohfeldian sense, the property right being transferred is thus closer to an in personam one in that it is not fully enforceable against third parties until the requisite formalities are completed. ^{Footnote 41} Practically speaking, this means that the differences between the German and French models of property transfer by contract are not as great as they might first appear—even as there remain important theoretical and practical differences between these two models of property transfer by contract.

Beginning on the practical side, the relative effects of the transfer of property in French law are limited to subsequent acquirers of the property rather than the world at large. This means that between two persons who have successively acquired property from the same person, the one who obtains validly enforceable title is thus the first to acquire physical possession or to register it, as the case may be. ^{Footnote 42} In all other cases, French law maintains the general rule that the contract operates a full transfer of property with the end result being that the relative effect of these transfers constitutes an exception that is valid only against certain classes of persons.

The Supreme Court of Canada highlighted that this formula presents a practical difference with the German model—in which the acquisition of rights is in general made subject to compliance with certain formalities—in Ostiguy v Allie. ^{Footnote 43} A majority of the court in that case, with Justice Côté dissenting, concluded that the reforms leading to the adoption of the new Civil Code of Québec in 1994 had not undermined the application of the French model of transfer by contract in that Province. Accordingly, the subsequent sale and registration of the property at issue had not displaced the right acquired through prescription, contrary to the argument that had been put forward on the basis of the German model of transfer by contract. ^{Footnote 44} In this respect, the result appears to echo the argument put forward by at least one Quebec author, according to which the provision of a guarantee against such title defects at the moment of sale may be fundamentally incompatible with the French approach to property transfer. ^{Footnote 45}

Moving beyond these practical concerns, there are also important theoretical problems with the French model of transfer by contract itself. Indeed, while this model corresponds to robust conceptions of both freedom of contract and the freedom to dispose of property, it also makes it difficult to properly explain—let alone justify—the limits that must be imposed on these principles in order to ensure the security of transactions. This is especially true for the requirement that transfers of immovable property be registered in order to be enforceable against subsequent acquirers, which was absent from the original French codification in 1804. The publicity requirement in respect of these transfers did not fully emerge until midway through the nineteenth century, and even then was not incorporated within the Code civil until the above provision was added in 2016. ^{Footnote 46}

With respect to movable property, the rule now contained within the Code civil originated with the 1804 version of the Code itself. ^{Footnote 47} As such, various alternative explanations have been suggested for its existence beyond simply reflecting a legislative choice to require publicity through delivery. One particularly popular view is that the rule recognises the immediate prescriptive acquisition of the property right in favour of its first possessor, according to the maxim “in matters of movables, possession is equivalent to title”. ^{Footnote 48} However, even this argument is largely unsatisfactory. ^{Footnote 49} What the French model of property transfer by contract appears to leave us with, then, is a conception of transfer in which the agreement itself is sufficient to pass property, subject to a few practical amendments imposed by positive law. Unlike in German law, there is no requirement that the parties to a contract recognise the existence of a public dimension to property when transferring it between themselves.

A. From Contract to Property: Kant’s Doctrine of Right

In The Doctrine of Right, which forms the first part of The Metaphysics of Morals, Kant begins his account of contract by defining the right it embodies as a “possession of another’s choice”. ^{Footnote 52} However, he takes care to distinguish his use of this phrase from the proprietary notions it might appear to embody. As he explains:

This single paragraph contains the core of Kant’s conception of contract as transfer, the transfer here being in relation to a right to performance—in civilian parlance, a “prestation”—that promisees can already count among their assets even before the contract is actually performed. ^{Footnote 54} Properly speaking, the object of the right being transferred is thus the promisors’ deeds, according to which they are bound to do or refrain from doing a particular action. We can distinguish this object from the effects of the promise itself—that is, essentially, the operation that the parties intend to bring about by the effect of the promise. This operation may entail the provision of services or, in many cases, the transfer of particular property rights from one contracting party to another. ^{Footnote 55}

The distinction between the object of the promise and its effects allows Kant to present the right gained by contract as one that is purely in personam, even in those cases where the intended effect of the promise involves the transfer of property rights with in rem effects. His doing so in turn advances a transfer theory that explains the operation of contract before turning to an account of how contract relates to the transfer of property rights. ^{Footnote 56}

Why Kant insists upon this distinction—that is, between the promissory aspect of contract and the transfer of property rights—appears somewhat mysterious at first glance. ^{Footnote 57} Indeed, it is fundamentally at odds with the idea that transfer theory understands contract as a sort of analogy to the transfer of property, which Dedek has argued was the basis on which earlier natural law scholars had constructed their own respective versions of such a theory. ^{Footnote 58} Upon closer inspection, however, it appears as though Kant’s distinctive approach can be explained in light of two distinct but related concerns. The first was his desire to account for the binding force of contracts generally. The second was to explain precisely why such agreements are properly binding between their parties, even though their effects against the world at large are considerably more limited.

In respect of the first of these two concerns, Kant’s solution was to devise the act of promising in a manner that grants it the basic structure of a transfer, according to which one party’s assets are diminished in a manner that is correlative to the other’s gain. ^{Footnote 59} This position not only serves to set Kant’s theory apart from the earlier, more property-focused conceptions of transfer, but also from more modern theories that find the basis of contract enforcement in the “promise” exchanged. ^{Footnote 60} Indeed, the fundamental distinction between Kant’s promise-based transfer theory and Charles Fried’s promise theory, for example, lies in the need for the promisor to effectively transfer the right to performance to the promisee in a way that allows the latter to impose legal sanctions on the former for non-compliance. ^{Footnote 61} Accordingly, promisors assume more than the mere moral duty to keep their promises, as the promisees gain a right to effectively coerce their performance. ^{Footnote 62}

By starting with this promise-based transfer theory of contract, Kant is able to account for the promisee’s right to demand performance of potentially any obligation that might arise out of a contractual framework. This solution may well be sufficient to explain the entitlement to expectation damages resulting from a breach of contract that appears so problematic to many common law writers, in that it appears to answer the challenge put forward by Fuller and Perdue’s classic article, “The Reliance Interest in Contract Damages”. ^{Footnote 63} For Kant, however, this conclusion appears to have been insufficient on its own to account for the binding force of contracts qua contracts—that is, as agreements that involve and are binding against only a limited number of parties.

This brings us the second concern that appears to have motivated Kant’s insistence on the distinction between the transfer of contractual rights and the transfer of property rights, namely his need to explain the strictly in personam nature of contractual rights themselves. This concern would have been all the more fundamental if, as a number of authors have suggested, Kant’s work presented a fundamental doubt as to the legitimacy of property rights as in rem rights—that is, as rights potentially enforceable against the world at large that do not impose a correlative obligation on property owners. ^{Footnote 64} Certainly, Kant tells us that acquired rights in general—be they acquired by way of unilateral acquisition of property, by contract, or through status-based relationships—are only fully legitimate within the civil condition. ^{Footnote 65} Property rights in particular are said to be only “provisional” in the state of nature, in the sense that ownership in that context appears synonymous with continued physical possession. ^{Footnote 66} It is this state of continuous possession, then, that appears as the core aspect of property that is capable of justification in the state of nature—and perhaps nothing more.

By contrast, the equivalent core of contract in the Kantian conception appears to be the notion of agreement itself, stripped of any and all third party effects that may guarantee that it will be respected by strangers to the transaction. ^{Footnote 67} Accordingly, Kantian transfer theory insists on separating this core—the in personam right between the parties—from at least one particular third-party effect of contracts, namely the transfer of property, going so far as to suggest that purely executory agreements cannot properly effect the transfer of property at all. ^{Footnote 68} An additional separate contract corresponding to the Roman law real contract, which Kant called a pactum re initium, is required for the promisor to pass property rights to the promisee even though the former is already bound to the latter under the original executory agreement. ^{Footnote 69}

The requirement of a secondary contract to transfer property is not accidental: the pactum re initium is a contract that arises at the same moment that property is physically delivered. When Kant moves to his account of the transfer of property, he is thus affirming the relevance of agreement to the transfer of in rem rights in much the same way that had been proposed by the older transfer theories. ^{Footnote 70} At the same time, however, this secondary property transfer remains subject to additional formalities, and can be distinguished from the separately justified creation of the obligations that allow property to be transferred in the first place. This allows Kant to avoid the problem of circularity that Dedek identifies within the earlier property-oriented transfer theories. Kant does so by positing a separation between the obligation to transfer a thing, on the one hand, and the actual performance of the transfer, on the other. ^{Footnote 71} Until such performance actually occurs, “the right that arises from a contract is only a right against a person, and becomes a right to a thing only by delivery of the thing”. ^{Footnote 72}

Following Kant’s account of transfer by contract, it is thus only where the parties have actually completed a transfer of property rights that the right of the promisee becomes more than simply an in personam right to compel the transfer of property from the promisor. The nature of both types of rights are different but related, in that Kant recognised that in rem rights are not truly rights relating to a thing. Instead, he saw them as rights enforceable against a potentially indeterminate class of persons who may interact with the property in question. ^{Footnote 73} It follows, then, that property rights cannot be transferred by agreement alone, and must comply with the additional rules set out in the civil condition. As I will argue in Part III below, it is precisely this aspect of Kant’s theory that allows us to make sense of the particular approach taken towards the transfer of property by contract in modern German law. At the same time, it is also what serves to set Kant’s particular conception of contractual transfer apart from the more traditional natural law theory that Hegel defends in his Philosophy of Right.

B. From Property to Contract: Hegel’s Philosophy of Right

Like Kant, Hegel also conceived of rights as necessarily involving a relationship between persons, rather than a relationship between persons and things. However, Hegel also rejected the possibility that the rights themselves might be enforceable directly against persons, ostensibly on the basis that such a right amounts to a form of slavery, and is thus fundamentally contrary to freedom. ^{Footnote 74} As he explained:

Following this paragraph, it appears that Hegel’s conception of rights effectively requires that legal relationships between persons necessarily pass through things, since no person may acquire a right directly against the other person. ^{Footnote 76} It further follows that the fundamental distinction between the transfer of in personam rights in contract and in rem rights in property, which forms the backbone of Kant’s transfer theory, can find little support in Hegel’s own account of contract as transfer.

In other words, the apparent incompatibility of in personam right with the notion of freedom suggested in the above paragraph recalls the distinction often made in civilian legal theory between persons, who have rights, and things, which are properly the object of rights. ^{Footnote 77} As Hegel saw it, the problem with Kant’s conception of in personam rights is that they are properly enforceable only against a particular person, rather than against a class of persons determined through reference to an externalised object. As a result, Kant’s distinctive right transferred by a contract—the prestation, which amounts to the promisee’s right to obtain performance from the promisor—appears to frame the promisors themselves as the objects of the right in question. ^{Footnote 78}

By contrast, Hegel presented his own conception of contract in largely proprietary terms, according to which the object of the contractual relationship was largely synonymous with the external thing being transferred. ^{Footnote 79} This much is made even clearer in the way that Hegelian abstract right appears to approach the contract of service—a class of contracts not normally understood to effect a transfer of property rights at all. Rather than relying on the transfer of a prestation—that is, of a right to demand that the promisor do or refrain from doing something—Hegel understood these contracts to relate to the transfer of things in the form of “determinate” aspects of personality first externalised through a person’s will. ^{Footnote 80} In so doing, he largely followed the earlier natural law transfer theories by beginning with an account of property—that is, of the external things that can be made the object of rights—before moving on to contract as a means of explaining how property can be transferred from one subject of right to another.

Where Hegel improved on these theories, however, is in addressing one particular difficulty that appears to have influenced Kant’s thinking on contract, namely that they do not account for the necessity of a meeting of the wills to transfer rights. If Dedek is to be believed, this may well have been the primary reason for which Kant rejected the traditional, property-based accounts of transfer theory, which largely conceive the transfer of property as comprising two separate unilateral events—that is, the unilateral abandonment of a right by the transferor, and its separate unilateral acquisition by the transferee. ^{Footnote 81} Kant’s solution to this problem, then, was to ground the basis for this meeting of the wills in a notion of contract that both preceded and remained separate from the transfer of property rights. ^{Footnote 82}

Hegel’s own solution to this problem appears to have built on Kant’s insight that in rem rights like ownership necessarily imply a relationship with other persons, rather than directly with the things themselves. ^{Footnote 83} Accordingly, the transfer of property rights by contract presents a moment in which the wills of two or more persons directly interact through—and are mediated by—the things in question. ^{Footnote 84} Thus, Kant tells us that “transfer is therefore an act in which an object belongs, for a moment, to both together”. ^{Footnote 85} Hegel’s analysis, meanwhile, reached much the same conclusion as Kant’s in this respect without having to defer to a pre-existing contractual obligation, in that he tells us that the contractual relationship itself “implies that each, in accordance with the common will of both, ceases to be an owner and yet remains one”. ^{Footnote 86}

Without drawing any conclusions as to the merits of Kant and Hegel’s respective positions, the fact that Hegel appears able to present a distinctive, agreement-centred account of property through transfer by contract in this way casts some doubt on the need for Kant’s rigid distinction between in personam and in rem rights. However, there remain at least two distinct advantages with the Kantian version of transfer theory. The first is that conceiving of contract as an in personam right offers a much more natural explanation of service contracts, a point that Stephen Smith has specifically raised against those theories that conceive of contract as essentially a transfer of property. ^{Footnote 87} The second, arguably more important advantage is that Kant’s version of transfer theory provides an ostensibly more coherent explanation for the manner in which the transfer of property by contract actually operates in practice.

In this latter respect, the comparative difficulties with Hegel’s approach emerge, for example, in the work of Peter Benson, who, following Hegel, has tended to present contract as effecting an immediate transfer of ownership. ^{Footnote 88} As Benson himself recognises, the conflation of what might otherwise be called the in rem and in personam aspects of the transfer creates problems in those cases where the thing being sold is not owned by the seller at the moment of sale, or where it has yet to be ascertained at the moment of contract formation. ^{Footnote 89} More importantly, however, Benson’s proposed answer to these problems amounts to a reintroduction of something like the distinction between rights in personam and rights in rem, which he calls the “relational transfer of property”. This phrase, which recalls the third party enforcement rule in French law, means that the transfer of property will remain limited to the parties themselves, without the full erga omnes effects expected of a right in rem, until the property becomes ascertainable or is effectively acquired by the seller. ^{Footnote 90}

Hegel’s account of the relationship between property and contract thus appears to present a strong problem of fit. This is all the more true given that all modern legal systems recognise the survival of a contractual right even in the absence of a valid property transfer. ^{Footnote 91} At the very least, making effective use of Hegelian transfer theory probably requires that we read his work in much the same manner that Benson has done—that is, in a manner that is broadly consistent with the French civil law’s understanding of transfer by contract. Indeed, as I will argue below, a number of insights can be gleaned from approaching French law itself through the lens of the Hegelian framework. Meanwhile, Kant’s own theory can be more properly related to the operation of transfers in those legal systems that follow the German branch of the civilian legal tradition.

A. Contract as Obligation in German Civil Law

As noted above, the German model of transfer by contract limits what the parties can accomplish through their agreement alone. Indeed, the parties can never actually transfer ownership except in conformity with the requirements of publicity—that is, by completing either delivery or registration. ^{Footnote 92} In this way, the German model is largely consistent with the particular version of transfer theory that Kant puts forward in The Doctrine of Right, according to which a contract can only transfer in personam rights, and in which property, taking the form of rights in rem, remains subject to its own separate transfer requirements. ^{Footnote 93}

Given this overlap, it is tempting at first glance to conclude that German law shares Kant’s apparent concern for the legitimacy of in rem rights. This particular concern is that such rights are potentially binding against the world at large, but impose no correlative duty to respect the property rights of others. ^{Footnote 94} However, this concern only masks another, perhaps more fundamental problem revealed by Kantian transfer theory, and which German law appears to be designed to avoid in practice. Namely, the concern that Kant highlights—and which German law evinces—is that allowing property to be transferred by an executory contract undermines the view of contract as an obligation, according to which the object of the contractual right is the particular deed of another person, rather than an external thing. ^{Footnote 95}

This particular conception of an “obligation” is far from unique to Kantian transfer theory or German law. It is recognised—albeit with slight variations—by almost all legal systems that follow the modern civilian canon in both its French and German variants. ^{Footnote 96} Going further, this notion of obligation can be traced back to Roman law sources, and most prominently the text of Justinian’s Institutes, which defined it as “a legal bond, with which we are bound by a necessity of performing some act according to the laws of our State”. ^{Footnote 97} Building onto this Roman definition, Zimmerman notes that “[t]oday the technical term ‘obligation’ is widely used to refer to a two-ended relationship which appears from the one end as a personal right to claim and from the other as a duty to render performance”. ^{Footnote 98}

By insisting that the transfer of property rights be understood separately from the contractual rights themselves, both German law and Kantian transfer theory thus preserve the integrity of the contract as an obligation—that is, as an essentially in personam right of the promisee that is correlative to the promisor’s duty of performance. Accordingly, the actual prestation to do or to refrain from doing something is understood to be the proper object of the contract, while the transfer of property amounts to performance of the obligation to transfer that has already been undertaken. It follows that only real contracts, in which agreement and performance occur simultaneously, are capable of effectively transferring property. As Kant explained:

In other words, Kant’s transfer theory suggests that the real contract, through which German law requires that the actual transfer of property occurs, does not amount to an obligation-generating event, at least from the perspective of the transferor-promisor. ^{Footnote 100} In this view, the real contract simply amounts to an agreement to transfer property rights—that is, to actually perform the obligation already undertaken—and is distinct from the obligation-generating agreement in which the transferee obtains the right to performance at a later date. ^{Footnote 101} If we return to the BGB provision pertaining to the actual transfer of ownership in movable property, we find that the agreement may intervene at the same time as performance, or the parties may later agree that delivery already rendered has amounted to an effective transfer of ownership. ^{Footnote 102} What matters is that the parties intended to alienate and to acquire, and that property has actually been handed over at the time of agreement, thereby completing the transfer in accordance with the general principles pertaining to the alienation and acquisition of property rights. ^{Footnote 103}

By contrast, the Kantian conception of the purely executory contract amounts to one in which the promisees obtain only an in personam right to force promisors to actually perform their end of the bargain. Where the contract in question is one where one or more parties have agreed to transfer property, the promisee’s right to performance effectively amounts to a right to compel the promisor to hand over possession of the property, and in so doing to complete the transfer through a separate agreement. As Kant explains:

This distinction between the transfer of prestations and the transfer of property allows Kantian transfer theory—and, it would seem, German law as well—to emphasise the properly obligational content of the contractual relationship. Meanwhile, the transfer of property is relegated to a secondary agreement by which the parties actually perform their respective obligations—that is, in the case of a contract pertaining to the transfer of property, their respective obligations to alienate and acquire the property in question. ^{Footnote 105}

Accordingly, Kantian transfer theory shares at least two important features with German law. The first is the apparent recognition that property rights, whether acquired unilaterally or derivatively through agreement, are in principle subject to the same basic requirement—that is, the requirement that they be acquired in a manner that is public, or at least knowable by all who might be concerned. The second, related feature is that the proper object of a contract is never the transfer of property rights, but rather the promisor’s prestation—that is, the promisor’s agreed-upon obligation to do or to refrain from doing something. As I will argue below, this view largely contrasts with the one put forward by the French conception of transfer by contract, in which an ostensibly contractual undertaking to transfer specific property simultaneously effects the transfer of the property rights in question.

B. Contract as Transfer of Property in French Civil Law

Having argued that both the Kantian account of transfer by contract and German law insist on the properly in personam nature of the contractual relationship, I will now attempt to show an affinity between Hegel’s own transfer theory and the other major model of property transfer by contract supplied by the French civilian tradition. Admittedly, this demonstration is comparatively more difficult than the one already made above, particularly given the ambiguities inherent in Hegel’s account of the relationship between property and contract. In fact, it is not quite clear that Hegel conceives of contract as giving rise to an in personam obligation to perform one’s promise at all, even as he seems to recognise the existence of a similar obligation to compensate the promisee in the event of a contractual breach. ^{Footnote 106}

As suggested above, however, and as I will argue here, reconciling Hegel’s account of contract with the manner in which contract actually operates in every modern western legal system requires that we read it to include some sort of in personam obligation to perform that is distinct from the property being transferred. ^{Footnote 107} Accordingly, while the transfer of property remains the primary focus of the parties’ relationship, the Hegelian account of contract appears to recognise a somewhat separate right in the promisee to demand performance of the contract from the promisor. ^{Footnote 108} It follows that a legal system consistent with Hegel, yet still compliant with the manner in which contract is understood to operate in practice, would thus recognise contract itself as a transfer of in rem rights that reserves certain in personam features for the parties to the transaction.

As it turns out, this conception of contract largely corresponds to the approach taken in French civil law. Like Hegelian transfer theory, French law presents all contracts, be they real or executory, as effecting a transfer of in rem rights alongside, but in a manner that is separate from, the conferral of in personam rights under the contract. ^{Footnote 109} Going further, however, it is even possible to affirm that French law actually places the proprietary transfer ahead of the contractual obligation, which is understood primarily as a means of effecting the transfer of property. This much is supported by the placement of contracts alongside successions and testamentary dispositions within Book III the Code civil, the title of which is “Des différentes manières dont on acquiert la propriété”—that is, literally, “the different ways in which one acquires property”. ^{Footnote 110}

What this means is that the broader view of contract taken by both French civil law and Hegelian transfer theory appears to be largely analogous to the German and Kantian notion of real contract, in which the parties’ agreement is directed primarily towards the respective intention to alienate property, on the one hand, and acquire it, on the other. ^{Footnote 111} The notion of a contractual obligation, in the sense of a pure obligation to do or to refrain from doing something, only fully intervenes in respect of a transfer of property where the parties have agreed to defer the transfer in question, or where the property is otherwise incapable of being transferred. ^{Footnote 112} The actual obligation to transfer property is in all other cases rendered essentially redundant, operating at the very same moment that the parties conclude their agreement. ^{Footnote 113}

Accordingly, the French approach to the transfer of property by contract can be said to conform to Hegelian transfer in at least two distinct but related ways. The first is with respect to the French law’s conception of contract as immediately effecting a transfer of property rights, which appears to have been heavily influenced by the views of the older natural law scholars. ^{Footnote 114} The second is in the approach that both French civil law and Hegelian transfer theory take towards the requirement of publicity—that is, the role played by the requirements of delivery and registration.

Hegel, like French law, appears to have taken the view that publicity does not amount to an essential requirement of the derivative acquisition of property by contract. Instead, Hegel saw it as an essentially legislative choice that could be made for pragmatic reasons, echoing his view that the “understanding”—by which he seems to mean positive law—can and must determine the precise degree of control required to acquire property unilaterally. ^{Footnote 115} As Hegel explained:

Although Hegel recognised the possibility of imposing publicity requirements on contractual transfers of property, he does not appear to have considered them a requirement from the perspective of abstract right. In this respect, his position contrasts markedly with the views espoused by Kant, according to which property rights themselves are only ever provisional in the state of nature—that is, outside the civil condition. ^{Footnote 117} Indeed, Hegel appears to have left the parties free to structure the transfer of property as they will even in the abstract, much in the same manner that French law understands the alienation and acquisition of property by contract to operate by agreement alone, and thus outside of any strict requirement of publicity. ^{Footnote 118}

Thus, by conceiving contract as essentially a transfer of property, both French civil law and Hegelian transfer theory have paradoxically afforded the parties a freedom of contract that is rejected by both German law and the Kantian conception of transfer. This approach avoids one of the more difficult problems outlined above, namely the apparent problem caused by viewing the actions of persons as possible objects of rights. ^{Footnote 119} At the same time, however, the freedom it confers upon the parties comes at a relatively steep price. Indeed, by shifting the focus of contract away from the direct relationship between persons—as Hegel does, and French law appears to do—this approach also undermines the very notion of contractual obligation as a distinct legal category.

Instead, what we are left with is a conception of contract that is itself divided into two distinct but potentially simultaneous operations. The first is a transfer of property—that is, a transfer of in rem rights—from the promisor to the promisee. The second corresponds to the properly in personam dimension of the contract, though strictly speaking it is no longer synonymous with a personal right to demand performance—that facet of the exchange having already been covered in many cases by the transfer of property rights. ^{Footnote 120} In those cases, the in personam aspect of the transaction becomes only a right to demand compensation for a breach of the agreement, raising the question of whether a properly contractual right to performance can be said to exist at all. ^{Footnote 121}