Older Uniform Acts

Providing for Autonomous Electronic Devices in the Electronic Commerce Act 1999

III. Curing Doctrinal Difficulties by Treating Electronic Devices as Independent Legal Persons

Artificial Persons

One possible means of curing these doctrinal defects would be to deem autonomous electronic devices to be legal persons and develop a theory of liability on that basis.79 Although this approach may sound strange to the uninitiated, it is a well known technique in legal reasoning. As John Chipman Gray put it:

In books of Law, as in other books, and in common speech, “person” is often used as meaning human being, but the technical meaning of a “person” is a subject of legal rights and duties.80

Once the concept of a legal person is understood not as body or soul but as “a subject of legal rights and duties”, one can begin to comprehend the law’s long history of conferring legal personality to several human artifacts including not only corporations81 but ships82 and even temples.83 It is by virtue of the legal attribution of rights and duties to such entities that they become capable of owning property, owing duties of care and having the capacity to sue or be sued. Some authors, including Gray, have been critical of the idea of attributing legal personality to such artifacts. After all, what is the point of making an artifact – which can neither understand the law nor act upon it – the subject of a legal duty?84 This criticism becomes especially relevant when the so-called “acts” of complex artificial persons such as corporation are reducible to relations between human individuals. This critical (though somewhat rhetorical) observation will serve as a useful point of departure for the ensuing discussion. Following Gray, it is suggested that the conferral of legal personality on an artificial entity is justified if and only if there is good reason to do so.

B. The Justification for Deeming Electronic Devices Legal Persons

There are at least three different kinds of reasons usually offered as a justification for attributing legal personality to an entity: i) moral entitlement; ii) social capacity; and
iii) legal convenience.85 The criterion for achieving moral entitlement most often requires that the entity in question is in some sense conscious or sentient. Although there exists a substantial literature on the possibility of machine-generated consciousness,86 a detailed examination of this issue is unnecessary for our present purposes. Given the current state of agent technology, as Allen and Widdison have pointed out, “[w]e are concerned with the protection of those who trade through the computer, rather than the protection of the computer itself. The computer has no interest in these transactions.”87 When we refer to electronic devices as intelligent agents, we are not ascribing moral agency to them. The electronic devices contemplated here are no more moral agents than are our toasters and fridges. As discussed above, electronic devices are not capable of consenting, making promises, etc.. Even if such devices can be described as intelligent or as acting autonomously, we are nowhere near the point where these devices can be said to be making conscious, moral decisions of their own. The devices are not contracting for themselves. Consequently, they cannot presently be ascribed of legal personality on the basis of moral entitlement.88

What about ascribing legal personality on the basis of exhibiting a social capacity? Since at least the time of Turing, many philosophers, cognitive psychologists and computer scientists have held that the relevant question is not whether an electronic device exhibits moral consciousness but whether it could successfully interact with a human questioner so as to convince him or her that it does.89 The focus here is not on outward appearances simpliciter but, rather, on the manifestation of social behaviour. Applying Turing’s approach to the issue of whether electronic devices should be considered legal persons for the purposes of electronic commerce, we would focus on whether the behaviour manifested by an electronic device is sufficiently similar to the behaviour manifested by a legal person who understands that his or her actions may result in the formation of a contract. According to those who favour this approach, once people who interact with an electronic device begin to regard it, rather than its human controllers, as the source of an offer or its acceptance, we might say that the electronic device has achieved the requisite social capacity to confer upon it the status of legal person.90 As Allen and Widdison put it:

For example, we are now inclined to say that the most advanced chess computers play chess on their own; we might also say that autonomous computers make agreements on their own. In this practical, extra-legal sense, we attribute the actions to the computer itself. Hence, it makes sense to think of conferring legal personality on the computer.91

However, the fact that “it makes sense to think of conferring legal personality on the computer” by no means implies that doing so would be a good idea, nor does it entail that we are legally or morally compelled to do so. As will be discussed in greater detail in Parts IV and V below, there are conceptual means by which we might understand computer-initiated agreements as legally binding without any need to personify electronic devices. If this is correct, the pressing question is whether there would be any additional value in conferring personality on such devices. In other words, are there sound commercial reasons for treating electronic devices as independent legal subjects capable of holding rights and owing duties?

If the future development of agent technology resembles the predictions offered above in Part I, there is at least one reason in favour of treating electronic devices as independent legal persons under certain circumstances. Given the polymorphic nature of some electronic devices, holding liable the human user who created the agent – whether in contract or in tort – will lead to injustices in situations where the electronic device puts forth an offer (or accepts an offer) in a manner that no human user could ever have reasonably foreseen. In such situations, treating the electronic device as an independent legal person would serve to absolve of contractual liability the human user who created the device through a recognition of the fact that some other “person” put forth the offer. Alternatively, to put it in the language of tort law, the device would be seen as a novus actus interveniens.

In this instance, the commercial reason in favour of treating the electronic device as an independent legal person is that no human has done anything that specifically resulted in the creation of expectation, reliance or harm. As Karnow has pointed out, “just as we are not liable for the consequences of a human agent’s unforeseeable pathological actions, so too humans should be absolved of liability from the unforeseen results of machine intelligence’s pathology.”92 It is important to recognize that this is not to suggest that human users are not accountable for the consequences of reasonably foreseeable computer errors. But, according to Karnow, the “rationale for imposing liability fails when no particular human has the ability to prevent the injury, short of banning the use of intelligent agents altogether.”93

Of course, this reason in favour of treating electronic devices as legal persons must be weighed against competing considerations. One theoretical counter-consideration is that legal personality is usually understood as a two-sided coin. If we are to say that electronic devices are subject to duties (e.g., the duty owed to an offeree upon acceptance of an agreement unintended by the human creator or, perhaps, the duty owed to the human creator not to enter into unintended agreements), mustn’t we also say that electronic devices are owed certain rights? It is odd to think of a legal person who is subject to legal duties but enjoys no independent legal rights.94

Even if it could sensibly be said that electronic devices are legal persons who owe duties, though they are owed no rights, it is not exactly clear how individuated personality could in any meaningful sense be ascribed to such devices, given their polymorphic nature:

In an eternally changing context, agents have no inherent substantiality or persistence. They are polymorphic. The agents’ roles change from centrally active, to sustaining context, to inactive or absent altogether from the processing environment.95

How, then, are we to identify the liable electronic device? “Is it the hardware? Is it the software? What if the hardware and software are dispersed over several sites and maintained by different individuals?”96

It could perhaps be argued that this problem of identification is not unique to electronic devices. Such problems are also experienced with corporate entities whose constituents and control mechanisms are also subject to change over time. As is the case with corporations, one possible identification procedure involves some form of registry. Thus we might require of all human traders who want to create electronic devices for use in electronic commerce, that they register an identifiable device name and some form of digital signature for the device, as well as identify themselves as the party standing behind the silicon veil. Karnow proposes one such system which he refers to as the “Turing Registry”:

Just as insurance companies examine and certify candidates for life insurance, automobile insurance and the like, so too developers seeking coverage for an agent could submit it to a certification procedure, and if successful would be quoted a rating depending on the probable risks posed by the agent. That risk would be assessed along a spectrum of automation: the higher the intelligence, the higher the risk, and thus the higher the premium and vice versa. If third parties declined to deal with uncertified programs the system would become self-fulfilling and self-policing. Sites should be sufficiently concerned to deal only with certified agents. Programmers (or others with an interest in using, licensing or selling the agent) would in effect be required to secure a Turing certification, pay the premium and thereby secure protection for sites at which their agents are employed.97

Karnow goes on to describe his version of the registry in detail. Although his proposed registry procedure is thorough and very clearly explicated, what is unclear is why anyone would go to the trouble and expense of devising and implementing such a system when there exist far less expensive and less demanding mechanisms of achieving the same result, i.e, the adoption of a few statutory adjustments to the law of contract. Since it is not yet known how frequently electronic devices will produce unintended agreements of consequence,98 it is not clear whether the added complication and expense that would be required to develop such a system is justified – especially when one takes into account the fact that many electronic transactions will be inter-jurisdictional.99 As well, unlike a corporate registry, a system which ascribes personality to electronic devices would not necessarily solve all of the identification problems since polymorphic devices are continuously evolving.

Recommendation

Given all of these practical uncertainties, as well as the theoretical problems enumerated above, it seems relatively clear that a cost-benefit analysis of the legal and economic advantages of an electronic device registry would result in a recommendation against curing the doctrinal difficulties associated with electronic devices by treating them as independent legal persons. As at least two critics have pointed out, “it seems superfluous from the business perspective. If traders would go to the trouble of registering a computer for network use, then why would they not go through the trouble of signing an interchange or network agreement, which would serve the same purpose of guaranteeing the enforceability of agreements?”100

Next Annual Meeting

2018 Conference (Centennial)

Delta Hotel

Québec City, QC

August 12 - 16, 2018