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A Study of Law and Grace

Updated: Feb 20, 2021

A Study of Law and Grace – The Three Covenants

Jeremiah 31:31-34.

“Behold, the days are coming, declares the LORD, when I will make a new covenant with the house of Israel and with the house of Judah. It will not be like the covenant I made with their fathers when I took them by the hand to lead them out of the land of Egypt—a covenant they broke, though I was a husband to them” declares the LORD. “But this is the covenant I will make with the house of Israel after those days, declares the LORD. I will put My law in their minds and inscribe it on their hearts. And I will be their God, and they will be My people. No longer will each man teach his neighbour or his brother, saying, ‘Know the LORD,’ because they will all know Me, from the least of them to the greatest, declares the LORD. For I will forgive their iniquities and will remember their sins no more.”

John 1:17

“For the law was given through Moses; grace and truth came through Jesus Christ”.


This morning I want to talk about the relationship mankind has had with God through the ages, and how He relates to us today. You may ask is this important? It is so important - it will decide whether the power of God can manifest in your life or not. God loves you, but He is unable to help you like He wants to if you don’t know how to relate to Him. We have a part to play. God has given us authority and freedom over our own lives. I will now explain more fully what I mean.

The Covenant with Abraham

One of the earliest covenants God made with man was the one He made with Abraham. Let’s look at;

Genesis 15:5-7

And the LORD took him outside and said, “Now look to the heavens and count the stars, if you are able.” Then He told him, “So shall your offspring be.” Abraham believed the LORD, and it was credited to him as righteousness. The LORD also told him, “I am the LORD, who brought you out of Ur of the Chaldeans to give you this land to possess.”

God did not give Abraham a law, He gave him a blessing. Not a trace of a law! Notice in verse 6, that for Abraham to be righteous with God, all He did was believe, I say it again, all He did was believe and it made him righteous in God’s eyes. The covenant that Abraham and his descendants had was built on GRACE - no laws were in this. This was always what God wanted in his relationship with us. To Bless us way beyond our ability to receive. This brings us all the way up to Moses’ time. Then something changed and it all went wrong.

The Covenant given at Sinai, The Law Given through Moses

Also known as the Old Covenant, including the tabernacle and animal sacrifices and all the regulations that went with it, including the ten commandments. What I’m going to tell you may come as a surprise. This covenant was not what God wanted. A relationship is two way, and the Israelites failed to give their trust back, like Abraham did, and they kept running after other gods. Let’s look at a few texts.

Hosea 6:6

“For I desire mercy, not sacrifice, and acknowledgment of God rather than burnt offerings.”

Psalm 51:16,17

“You do not delight in sacrifice, or I would bring it; you do not take pleasure in burnt offerings, My sacrifice, O God, is a broken spirit; a broken and contrite heart you, God, will not despise”

Paul tells us why the law was given, because they wouldn’t listen, God had to show them their sins.

Galatians 3:19 from the NLT

“Why, then, was the law given? It was given alongside the promise to show people their sins. But the law was designed to last only until the coming of the child who was promised. God gave his law through angels to Moses, who was the mediator between God and the people”.

The NIV translations says “The law was added because of their transgressions until the seed would come”. That is Christ. So God had to “ADD” it, which shows it wasn’t his original plan. When God gave the law at Sinai, He knew that no one could keep it. As Paul just told us, it was given to SHOW US OUR SINS, not to try and gain our salvation by keeping it.

Romans 3:9-12

“There is no one righteous, not even one. There is no one who understands, no one who seeks God. All have turned away, they have together become worthless; there is no one who does good, not even one.”

This is relevant to us today because there are many churches today which, although professing the Gospel of Jesus, still have a law keeping mentality. Whenever someone says we “should” do this or that, or we “ought” to do this or that, they have moved from living under grace, to living under the attitude of law, even though they mean well. Sin is not just external actions that everyone can see, but a state of being. Therefore, however good your deeds are, you are still in sin. This is the reason Jesus came and died for us. Jesus tried to show us this in the Sermon on the Mount.

Matthew 5:21

Jesus says, “You have heard that it was said to the ancients, ‘Do not murder, and anyone who murders will be subject to judgment.’ But I tell you that anyone who is angry with his brother will be subject to judgment.” And again, in verse 27-28 Jesus also says, “You have heard that it was said, ‘Do not commit adultery.’ But I tell you that anyone who looks at a woman to lust after her has already committed adultery with her in his heart.”

He is showing us there is no way that we can ever avoid sin; it’s in our carnal nature. Just stopping the action doesn’t stop the sin. We are still sin. He was trying to move the people’s understanding of sin, as just an action, to a state of being.

If you live “sin conscious” and are always worried about “doing the right thing”, sin will increase in your life and you will inhibit the power of God. If you become “Christ conscious”, sin will decrease in your life and grace and power will flow, and your heart will be changed by the Spirit, you will see miracles in your life.

This is Paul’s attitude to the law, when I say law, I mean the Ten Commandments.

Romans 6:7-12

Well then, am I suggesting that the law of God is sinful? Of course not! In fact, it was the law that showed me my sin. I would never have known that coveting is wrong if the law had not said, “You must not covet.” But sin used this command to arouse all kinds of covetous desires within me! If there were no law, sin would not have that power. At one time I lived without understanding the law. But when I learned the command not to covet, for instance, the power of sin came to life, and I died. So I discovered that the law’s commands, which were supposed to bring life, brought spiritual death instead. Sin took advantage of those commands and deceived me; it used the commands to kill me. But still, the law itself is holy, and its commands are holy and right and good.

So, the result of being sin conscious is spiritual death. You will not grow in your relationship with Jesus if you are all the time feeling guilty and thinking of your sins

There is a warning for those churches who are law based in their teaching.

2 Corinthians 3:7

The old way, with laws etched in stone (i.e. the ten commandments), led to death, though it began with such glory that the people of Israel could not bear to look at Moses’ face” and again following in verse 14 “But the people’s minds were hardened, and to this day whenever the old covenant is being read, the same veil covers their minds so they cannot understand the truth. And this veil can be removed only by believing in Christ”.

So if you hear anyone in the church today telling us to try harder to be good people, they have slipped into old covenant thinking, and are veiled in their understanding. Their teaching will not be blessed with the Spirit.

This leads us neatly into the glorious and final relationship we have with God, the relationship He always wanted with His people, the Covenant of grace.

The New Covenant in Jesus Christ for all eternity

When Jesus died and rose again, He restored us back to the relationship that God wanted with us at the beginning and for all time. The relationship we had when we were first created. Let’s look at what Paul says.

Romans 5:12

“Therefore, just as sin entered the world through one man, and death came to all people, because all sinned”.

After Adam sinned, all of us are born in sin, with a sinful nature, and no good work can ever remove it. We inherit sin when we are born, all the way from Adam.

Verse 17-19

“For if, by the trespass of the one man, death reigned through that one man, how much more will those who receive God’s abundant provision of grace and of the gift of righteousness reign in life through the one man, Jesus Christ! Consequently, just as one trespass resulted in condemnation for all people, so also one righteous act resulted in justification and life for all people. For just as through the disobedience of the one man the many were made sinners, so also through the obedience of the one man the many will be made righteous.”

So, when Jesus said “It is finished”, He erased all the sinful history from Adam to all eternity, restored our right standing with God as though we had never sinned. And part of our renewal or “being born again” was receiving the Holy Spirit as promised. The folks that lived before the cross didn’t have the Holy Spirit in them like we do. The Holy Spirit was not given to the world until Pentecost. Compare what Jesus now says with Jeremiah’s prophesy.

John 14:25-26

“All this I have spoken while still with you. But the Advocate, the Holy Spirit, whom the Father will send in my name, will teach you all things and will remind you of everything I have said to you.”

God previously dealt with his people through the prophets, but now He speaks directly through our hearts by His Spirit that lives in us. You can see why Jesus used the term “Born again” in John 3. We are now Children born under Jesus, no longer Adam’s seed, but children of God. We may still live in our physical carnal bodies, but our spirit has been born into righteousness, the righteousness of Jesus. And lives in us.

2 Corinthians 5:21

“God made him who had no sin to be sin for us, so that in him we might become the righteousness of God.” And again, in verse 19 “that God was reconciling the world to himself in Christ, not counting people’s sins against them. And He has committed to us the message of reconciliation.”

1 John 4:17

“This is how love is made complete among us so that we will have confidence on the Day of Judgment: in this world we are like Jesus”.

In God’s eyes, you are as righteous as Christ, you are perfect when He looks at you. He not only forgives all your sins, He also chooses not to remember you ever sinned.

Hebrews 8:12

“For I will forgive their wickedness and will remember their sins no more."

When Jesus said “It is finished”, He dealt with all our sin for all eternity, as far as God is concerned there is no more sin for those who have been born again in Christ.



Anyone who believes and is baptised will be saved. But anyone who refuses to believe will be condemned”.

Notice the reason folks are not saved is they have not accepted Jesus as their Saviour, not because they have done wicked things. So how do we become good if all our efforts achieve nothing?

Good works and right behaviour are a FRUIT of a changed heart; we become righteous from inside out and our actions reflect what is born in our heart. It is no good trying to be good - we naturally become good when God fixes us through the Spirit. The heart must be born again first. And this is how our hearts are changed:

2 Corinthians 3:17-18

“Now the Lord is the Spirit, and where the Spirit of the Lord is, there is freedom. And we, who with unveiled faces all reflect the glory of the Lord, are being transformed into His image with intensifying glory, which comes from the Lord, who is the Spirit”.

Philippians 1:6

“being confident of this, that He who began a good work in you will carry it on to completion until the day of Christ Jesus”.

It is Jesus, through the Holy Spirit in you that transforms you into a new person, not your own efforts. So have faith. Be like Abraham, who believed and it was credited to him as righteousness.

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