Taken from Michael S. Horton’s Lord and Servant: A Covenant Christology in the introduction under the heading, “Systematic-Theological Development.”
“The heart of the Reformation complaint was that the medieval church had turned the gospel into a new law. In other words, it had failed to properly distinguish law and gospel, command and promise, imperative and indicative. This was in no way a distinction between the Old and New Testaments, but rather ran throughout both. While we must beware excluding the principle of law from the new covenant and the gospel from the old, I am following the suggestion that the biblical covenants themselves call for organization under one of those two rubrics. Our Reformation forebears were not wide of the mark, therefore, when they said, “Therefore, the law and the gospel are the chief and general divisions of holy scriptures, and comprise the entire doctrine comprehended therein” (Ursinus).
Of course the Reformers were not the first to have been impressed with this paradigm of law and gospel. They themselves were influenced not only by their reading of Paul but also by Augustin’s reading of the apostle to the gentiles. So how did covenant theology come to identify three basic covenants in the biblical motif of covenant a way of expressing the inherent unity of God’s external works in creation, redemption, and consummation. A broad consensus emerged with respect to the existence in Scripture (Noahic, Abrahamic, Mosaic, Davidic), but these are all seen as specific subcovenants of these broader arrangements. I will merely summarize these three overarching covenants here, without further exegetical ado, to expand on them under their appropriate topics in this volume.
An eternal compact between the persons of the Trinity, the covenant of redemption (pactum salutis) is represented in federal theology as the basis for all of God’s covenantal activity in history. Accordingly, the Father elects a people whom he gives to the Son as their mediator and the Spirit promises to unite them to the Son. Already we glimpse the intra-Trinitarian perichoresis that I will more fully develop in my discussion of creation: the Father does all things in the Son and through the Spirit. Thus Trinitarian theology has always been not only a central concept but an organizing motif in the classic Reformed systems.
The two covenants executed in history are the covenants of creation and grace. Created in righteousness and ethically equipped to fulfill the task of imitating God’s own “works” in order to enter his Sabbath “rest,” Adam as the representative head of the human race was already eschatologically oriented toward the future. As a reward for his faithfulness to the covenant, he would lead humanity in triumphant procession into the everlasting consummation, confirmed in righteousness. However, as a consequence of his disobedience and the mysterious solidarity of humanity in Adam, the sanctions of the creation covenant were invoked. In contrast to the conditional emphasis of the pre-fall covenant, however, God issues a unilateral promise to overcome the curse through the woman’s offspring. This covenant of grace, carried forward to Seth and his descendants, is renewed in the Abrahamic covenant, just as the works principle in the creation covenant is renewed in the Sinai covenant. On the basis of the Messiah’s fulfillment of the covenant of works (in fulfillment of his mediatorial role assigned in the covenant of redemption), the people of God are accepted on the terms of the covenant of grace. (x-xii)