Decided 1 January 1599 Court Queen's Bench | End date January 1, 1599 | |
Full case name Edward Darcy Esquire v Thomas Allin of London Haberdasher Citation(s) (1599) 74 ER 1131, (1602) 77 Eng Rep 1260 and (1599) Noy 173 | ||
Edward Darcy Esquire v Thomas Allin of London Haberdasher (1599) 74 ER 1131 (also spelled as "Allain" or "Allen" and "Allein" but most widely known as the Case of Monopolies), was an early landmark case in English law, establishing that the grant of exclusive rights to produce any article was improper (monopoly). The reasoning behind the outcome of the case, which was decided at a time before courts regularly issued written opinions, was reported by Sir Edward Coke.
Contents
Facts
The plaintiff, Edward Darcy, a member of Queen Elizabeth's court, received from the queen a licence to import and sell all playing cards to be marketed in England. This arrangement was apparently secured in part by the Queen's concern that card-playing was becoming a problem among her subjects and that having one person control the trade would regulate the activity. When the defendant, T. Allin, sought to make and sell his own playing cards, Darcy sued to prevent this competition.
Judgment
The Queen's Bench court determined that the Queen's grant of a monopoly was invalid, for several reasons:
- Such a monopoly prevents persons who may be skilled in a trade from practising their trade, and therefore promotes idleness.
- Grant of a monopoly damages not only tradesman in that field, but everyone who wants to use the product, because the monopolist will raise the price, but will have no incentive to maintain the quality of the goods sold.
- The Queen intended to permit this monopoly for the public good, but she must have been deceived because such a monopoly can be used only for the private gain of the monopolist.
- It would set a dangerous precedent to allow a trade to be monopolized - particularly because the person being granted the monopoly in this case knew nothing about making cards himself, and where there was no law that permitted the creation of such a monopoly.
Significance
Darcy v Allin was the first definitive statement by a court that state-established monopolies are inherently harmful and therefore contrary to law. The case has since come to be known as The Case of Monopolies, and the arguments set forth therein have served as the basis for modern antitrust and competition law. It drew considerably on historical evidence of rulers antipathy to monopolies, as follows.
For we read in Justinian that monopolies are not to be meddled with, because they do not conduce to the benefit of the common weal but to its ruin and damage. The civil Laws forbid monopolies: in the chapter of monopolies, one and the same Law. The Emperor Zeno ordained that those practicing monopolies should be deprived of all their goods. Zeno added that even imperial Prescripts were not to be accepted if they granted monopolies to anyone.