l^s^T^^'^^^ tWiC-.. OJornEll Ham 0>rt|ool Hthtary iFrom tlfp Hthrarg of aiuiige ffifonari QJ. QJrmtrt!. pi}.!. 1889 fflornEll ffiatt) ^rljool 18911-91 Cornell University Library KF 801.A86 1919 Principles of the law of contract :with 1924 018 846 323 The original of this book is in the Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/details/cu31924018846323 PRINCIPLES OF THE LAW OF CONTRACT WITH A CHAPTER ON THE LAW OF AGENCY AMERICAN EDITION COBBIN PRINCIPLES OP THE LAW OF CONTEACT WITH A CHAPTER ON THE LAW OF AGENCY BT SIR WILLIAM R/'aNSON, Bart., D.C.L. OF THE INNER TEMPLE, BARRI8TER-AT-LAW WARDEN OF ALL SOULS COLLEGE, OXFORD JFonrtenitl^ Ctifflis!) Cuitton THIKD AMERICAN COPYKIGHT EDITION EDITED, WITH AMERICAN NOTES BY AETHUR L. CORBIN hotobubb pbofbssob of lat, taib mgirBBsirr school or lat NEW YOEK OXFORD UNIVERSITY PRESS AMERICAN BRANCH : 35 WEST 32ND ST. LONDON, TORONTO, MELBOURNE & BOMBAY 1919 'BV7907 CoprBioET 1919 bt oxford university press AUBIOAS BSAHOn FRINTED BY H. O. HOUGHTON b CO. CAMBRIDGE, MASS. U.S.A. ^^hTv? PREFACE TO THIRD AMERICAN EDITION In approaching the study of the law the student should be given some direction and assistance along two lines that gen- erally have not been mentioned to him at aU. First, he should be warned that the law does not consist of a series of unchangeable rules or principles engraved upon an in- destructible brass plate or, hke the code of Hammurabi, upon a stone colunm. Every system of justice and of right is of human development, and the necessary corollary is that no known sys- tem is eternal. In the long history of the law can be observed the birth and death of legal principles. They move first with the imcertain steps of childhood, then enjoy a season of confident maturity, and finally pass tottering to the grave. It is during their middle period only that they can be used with confidence as the major premise of a deduction, to determine the legal rela- tions of men in a particular case. The law is merely a part of our changing civilization. The history of law is the history of man and of society. Legal principles represent the prevaihng mores of the time, and with the mores they must necessarily be bom, survive for the appointed season, and perish. Secondly, the student should be given certain fundamental legal conceptions described in definite terms without a shifting connotation. These concepts and these terms are the intellectual tools with which he is to construct and set forth his own system of legal principles, as well as the tools by which an instructor or text writer or judge constructs and inculcates his principle or sys- tem of principles. The more common legal concepts described by such terms as "contract," "property," "ownership," "trust," "obligation," are complex in character and their content is vari- able. Even so common a term as "right" can be shown to have at least half a dozen different meanings. Such terms and con- cepts are therefore wholly inadequate for clear thinking and accurate expression. The truth of the warning as to the nature of law must he de- termined by each student anew for himself. This requires long vi PREFACE TO THIRD AMERICAN EDITION study and experience, a comparative study of cases both in books and in life. In this research he is seriously handicapped if he does not possess the tools mentioned in the preceding paragraph. The concepts and terms constituting these tools have long ex- isted in the reasoning of oiu- courts. It remained only to identify and isolate them and to "fix" the meanings of terms. Progress in this direction has been made by Terry, Salmond, and many others; but to the present editor it seems that more progress was made by his late colleague. Professor Wesley N. Hohfeld, than by others. In two articles, at present to be foimd only in magazine form, (1913) 23 Yale Law Journal, 16, and (1917) 26 Yale Law Journal, 710, Professor Hohfeld identified eight simple fundamental concepts, and fixed their meaning by setting them out in pairs of opposites and pairs of correlatives. His classifica- tion is as follows : Correlatives- 1 "^* Privilege' power immunity ■ \ duty no-right liabihty disability ^ •+ . i right privilege power immunity ■ \ no-right duty disability liabiUty The eight terms thus set out express pvu-ely mental concepts of the jural relations of human beings. It is the merit of Professor Hohfeld's articles, cited above, that they are rich in illustration of the uses of these concepts in actual judicial reasoning to be found in the law of property, contract, tort, and other legal fields. It is also their merit that they caU sharp attention to the distinction between jural relations and the operative or causal facts of life that bring such relations into existence. Only an intensive and repeated study of these articles will show their full value; and only by repeated analysis of legal problems by means of the machinery there presented will the practical bene- fits of such analysis to lawyers and to clients be made fully apparent. In the present edition, building upon the work of Sir William Anson and Dean Huffcut, the editor has introduced the termin- ology and analytical method above mentioned, so far as this seemed possible without too violent an alteration of the text or an undue expansion of the notes. This edition is based specifi- cally upon the twelfth English edition, most of the changes of the EngUsh editor being incorporated. A considerable re- arrangement of topics has seemed desirable in the latter half of the book, the text nevertheless remaining that of Sir William Anson and his EngUsh editor with the following exceptions. Cer- PREFACE TO THIRD AMERICAN EDITION vii tain merely verbal changes have been made in the interest of analytical consistency and clearness. Occasional additions to the text have been made for the same purpose or in order to state more fully the American law. The authorship of these ad- ditions is indicated by footnotes, the following sections being wholly the work of the present editor: 37a, 161-161b, 251a, 259a, 284-301, 353, 355-372, 373, 385, 386, 401. No attempt has been made to differentiate between the work of Dean Huffcut and of the present editor in the footnotes. The citation of American cases is very largely the work of Dean Huff- cut, although many recent cases have been added; the critical notes are almost always the work of the present editor. The sec- tion numbers as far as section 274 correspond with those of the previous edition; thereafter the topical rearrangement required entirely new munbering. Some sections dealing exclusively with English statutes are reduced to small type as in the previous edition. A. L. C. Yale Univbrsitt School op Law January, 1919 PREFACE TO THE SIXTH EDITION When the subject of Contract was first introduced into the School of Jurisprudence at Oxford, in the year 1877, teachers of law had to consider the books which their pupils might best be directed to read. Some works on the subject, of acknowledged value to the practicing lawyer, were hardly suitable for begin- ners, and the choice seemed to he between the works of Mr. Leake, Sir Frederick Pollock, and the late Mr. Smith. Of these, Mr. Smith alone wrote expressly for students, and I had, as a student, read his book with interest and advantage. But I thought that it left room for an elementary treatise worked out upon different lines. Neither Sir Frederick Pollock nor Mr. Leake wrote for begin- ners, and I feared lest the mass of statement and illustration which their books contain, ordered and luminous though it be, might tend to oppress and dishearten the student entering upon a course of reading for the School of Law. Being at that time the only public teacher of English law in the University, I had some practical acquaintance with the sort of difficulties which beset the learner, and I endeavored to supply the want which I have described. In working out the plan of my book I necessarily studied the modes of treatment adopted by these two writers, and I became aware that they are based on two totally different principles. Mr. Leake treats the contract as a subject of litigation, from the point of view of the pleader's chambers. He seems to ask, What are the kinds of contract of which this may be one? Then — What have I got to prove? By what defences may I be met? Sir Frederick Pollock regards the subject ab extra; he inquires what is the nature of that legal relation which we term contract, and how it is brought about. He watches the parties coming to terms, tells us how the contract may be made, and by what flaws in its structure it may be invalidated. Mr. Leake treats the sub- ject from every point of view in which it can interest a litigant. Sir Frederick Pollock wrote a treatise on the Formation of Con- tract: only in later editions has he introduced a chapter on Performance. PREFACE TO THE SIXTH EDITION ix To both these writers I must own myself to be under great obligations. If I try to apportion my gratitude, I should say that perhaps I obtained the most complete information on the subject from Mr. Leake, but that Sir Frederick Pollock started me on my way. The object which I set before me was to trace the principles which govern the contractual obligation from its beginning to its end; to show how a contract is made, what is needed to make it binding, whom it may affect, how it is interpreted, and how it may be discharged. I wished to do this in outline, and in such a way as might best induce the student to refer to cases, and to acquire the habit of going to original authorities instead of tak- ing rules upon trust. So I have cited few cases: not desiring to present to the reader all the modes in which principles have been applied to facts, and perhaps imperceptibly qualified in their application, but rather to illustrate general rules by the most recent or most striking decisions. In successive editions I have made some changes of arrange- ment, and have tried to keep the book up to date. Since it first appeared, in 1879, the Legislature has been busy with the law of contract. The law relating to Married Women's Property, to Bankruptcy, to Bills of Exchange, to Partnership, to Mercantile Agency, has either been recast or thrown for the first time into statutory form: the effects of the Judicature Act in the general application of equitable rules and remedies have become grad- ually apparent in judicial decisions. Thus it has been necessary to alter parts of my book from time to time, but in this, the sixth, edition I have made many changes for the sake of greater clearness and better arrangement. The whole of the chapters on Offer and Acceptance, on the Effects of Illegality, on the Dis- charge of Contract by Breach, and a great part of the chapters on Mistake and Fraud, Infants and Married Women, have been rewritten, and the rest of the book has undergone many minor alterations as the result of a general revision. I should add one word as to the place assigned to Agency. It is a difficiilt subject to put precisely where the reader would ex- pect to find it. It is a mode of forming the contractual relation: it is also a form of the contract of emplosonent. From the first of these points of view it might form part of a chapter on Offer and Acceptance, regarding the agent as a mode of communica- tion; or it might form part of a chapter on the Capacity of Par- ties, regarding representation as an extension of contractual X PREFACE TO THE SIXTH EDITION capacity; or, again, it might form part of a chapter on the Operation of Contract, regarding agency as a means whereby two persons may make a contract binding on a third. But upon the whole I think it is best to try and make the student understand that the agent represents his principal in virtue of a special contract existing between them, the contract of employment. There is a disadvantage, no doubt, in intro- ducing into a treatise on the general principles of contract a chapter dealing with one of the special sorts of contract, but I beUeve that the student will find less difficulty in this part of the law if he is required to understand that the agent acquires rights and incurs liabiUties for his principal, not in virtue of any occult theory of representation, but because he is employed for the piuTJOse, by a contract which the law recognizes. I should not close this preface without an expression of thanks to the friends who from time to time in the last ten years have helped me with suggestions or corrections of this book. To his Honor Judge Chalmers, to Sir Frederick Pollock, and in especial to the Vinerian Professor, Mr. Dicey, I owe much in the way of friendly communication on points of novelty or difficulty. Nor should a teacher of law be immindful of his debt to the student. The process of explaining a proposition of law to a mind unfa- miUar with legal ideas necessitates a self-scrutiny which is apt to lead to a sad self-conviction of ignorance or confusion of thought; and the difficulties of the learner will often present in a new hght what had become a commonplace to the teacher. Therefore I would not seem imgrateful to the law students of Trinity College, past and present, whom I have tried, and some- times not in vain, to interest in the law of contract. I hope that the present edition of this book may be a little shorter than the previous one. I strongly desire to keep it within such limits as is proper to a statement of elementary principles, with illustrations enough to explain the rules laid down, and, as I hope, to induce the student to consult authorities for himself. W. R. A. Au. Soin£ CoUiEQE, January, 1891 TABLE OF CONTENTS PART I INTRODUCTION CHAPTER I Place of Contract in Jurisprudence PAQB Outline of subject 1 Nature of contract: agreement and obligation 2 1. Analysis of agreement . 3 Requisites of agreement 3 Distinguished from contract 4 Characteristics of contract 6 2. Analysis of obligation 8 Characteristics of obligation ....... 8 Sources or forms erf obligation . . . . . .10 3. Definition of contract 13 PART II FORMATION OF CONTRACT CHAPTER II Elements necessary to a valid contract 14 Procedural matters 15 Terminology: void, voidable, unenforceable 18 CHAPTER III Offer and Acceptance 1. Contract springs from acceptance of offer 22 Agreement traceable to question and answer .... 22 Forms of ofier and acceptance 23 Unilateral and bilateral contracts 25 2. Offer and acceptance by words or by other conduct . . .26 Tacit contract .26 3. Offer must be communicated 29 Ignorance of offered promise 29 Ignorance of offered act 30 Ignorance of offered terms 31 Offer under seal ......... 34 xii TABLE OF CONTENTS PAOB 4. Acceptance must be communicated or manifested . . . .34 6. Acceptance manifested in manner prescribed by offer . . .36 Modes of acceptance 36 Acceptance the exercise of a power 37 Acceptance by doing an act 40 Acceptance by making a promise 41 Acceptance by post or telegraph 42 Place of acceptance 46 Can acceptance be revoked? 47 6. Offer may lapse or be revoked 47 Lapse of offer: forms of 47 Revocation of offer 60 VaUd before acceptance 50 Useless after acceptance 61 Irrevocable offers 52 Must revocation be commimicated? 54 Cook V. Oxley 56 Dickinson v. Dodds 57 7. Offer must contemplate legal relations 59 8. Acceptance must be absolute and correspond to offer . . .61 Refusal and counter offer 62 Mere statement of price 62 New terms in acceptance 62 Questions of construction 64 9. Offer not made to ascertained person 65 Offer made to all the world 65 Offer of reward 66 Invitations to treat 70 CHAPTER IV Form and Consideration Historical Introduction 72 History of formal contract 72 History of informal contract 74 History of remedies 74 History of consideration 76 Classification of contracts in English law 77 I. Formal Contract. 1. Contracts of record 78 2. Contracts under seal 82 How made 82 Characteristics 84 Statutory changes 86n When seal essential 89 II. Simple Contract. - ' All simple contracts require consideration. . . .92 Simple contracts unenforceable in absence of writing . 92 TABLE OF CONTENTS xiii PAOB III. Statute of Frauds. 1. Provisions of Fourth Section 93 Nature of contracts specified 94 Requirements of form 102 Efifect of non-compliance 107 2. Provisions of Seventeenth Section 110 Nature of contract specified 112 Bequirements of form 114 Effect of non-compliance 116 rV. Consideration. Definition 116 1. Necessity of: exceptions 116 2. General tests of suflBciency of consideration . . . 120 Need not be equal to promise in market value . . 120 Motive: Inducing cause and subsequent reliance. . 123 Must consideration move from promisee? . . . 126 Impossible, imcertain or vague promises . . . 128 Forbearance to sue and compromise of suit . . 129 Gratuitous undertakings 132 Performance of public duty 135 Promise to perform existing contract • . . 135 Performance of existing contract .... 137 Payment of smaller sum in satisfaction of larger 137 Composition with creditors .... 141 Mutual subscriptions to a charity . . . 142 Promise to perform contract with third person . . 143 3. Must be legal 147 4. Must not be past 147 Executory and executed consideration . . . 147 General rule: Past consideration ia no consideration . 149 Exceptions apparent and real 150 Consideration moved by previous request . . 150 Voluntary discharge of another's duties . . 153 Waiver of statutory privilege .... 155 5. Foreign contracts 160 CHAPTER V Capacity of Parties 1. Political or professional status 161 2. Infancy: void, voidable, and binding contracts .... 165 Ratification of voidable contracts: common law and statute 166 Necessaries 170 Contracts for infants' benefit 174 American note Legal analysis 177 Ratification 179 DisafBrmance 181 Liability for torts originating in contract .... 185 3dv TABLE OF CONTENTS PAGS 3. Corporations 188 4. Lunatics and drunken persons 190 5. Married women 192 Contrasts void at common law: exceptions .... 192 Separate estate in equity | 193 Separate estate by statute 194 English statutory changes 195 American statutory changes 197 CHAPTER VI Mistake, Misrepresentation, Fraud, and Duress L Mistake. Cases to be excluded . 200 Operative mistake . 201 As to terms of contract or the fact of agreement . . 202 As to identity of contracting party .... 206 As to identity of subject-matter 208 As to existence of subject-matter 209 As to intention known to other party .... 210 Effect of mistake 217 IL Innocent Misrepresentation. General considerations and distinctions .... 218 Distinguished from fraud 219 Distinguished from terms 222 Effect of misrepresentation and remedies . . ' . . 227 At common law 227 In equity 229 Damages 234 Estoppel 235 Effects of non-disclosure in contracts vberrimae fidei . . 237 Insurance contracts 237 Sales of land 240 Promoters' contracts 242 Suretyship and partnership 243 ni. Wilful Misrepresentation, or Fraud. Essential features 244 A false representation 245 Of a material fact 247 Made intentionally or recklessly 249 With intent that it be acted upon by the injured party 254 Which actually deceives 255 Effects of fraud 256 Remedies ex delicto and ex contractu .... 256 Fraud in equity ........ 260 rV. Duress Its nature and effect ........ 261 TABLE OF CONTENTS xv PAGE Undue Influence. How distinguished from fraud: definition .... 263 When presumed 265 Inequality of parties . 265 Special relation of parties 266 When to be proved 268 Effect of undue influence 268 CHAPTER VII Legality of Object L Nature of illegality , . 270 1. Contracts illegal by statute 270 General rules of construction 271 Sunday statutes . . 272 Wagering contracts 272 Definition 273 History: common law and statute .... 275 On rise and fall of prices 280 Insurance 281 i 2. Contracts illegal at common law 284 Agreements to conmiit crime or civil wrong . . . 284 Agreements against public policy 286 Affecting interstate relations 286 Injiuing public service 288 Perverting course of justice 289 Arbitration agreements in the United States . . 290 Abusing legal process 293 Against good morals . 295 Affecting freedom or security of marriage . . . 295 In restraint of trade 297 n. Effect of illegality 301 1. When the contract is divisible 302 2. When the contract is indivisible 303 3. Comparative effect of avoidance and illegality . . . 304 4. The intention of the parties 307 5. Securities for money due on illegal contract . . . 309 Securities under seal 309 Negotiable instruments 310 6. Belief from iUegal contract 312 Quasi-contractual and equitable remedies . . . 312 Parties not in pari delicto 312 Illegal purpose abandoned 314 The loctis poenitentiae ....,, 314 Money in hand of stakeholder 316 7. Contracts lawful where made but unlawful by lex fori . . 318 xvf TABLE OF CONTENTS PART III THE OPERATION OF CONTRACT PAOB Legal analjrsia. American note 321 CHAPTER VIII The Relations between Contractors and Third Persons General English rule as to privity of contract 32S Exceptions: agency and trust 325 1. Duties imposed on third parties 327 No contractual duty 327 But non-contractual duty 328 2. Rights acquired by third parties; English rules 330 Promise for benefit of third party 330 The rule in equity 332 Special doctrines of agency 334 CHAPTER IX Contracts for Benefit of Third Persons in the United States Privity of contract 335 Trust beneficiaries 335 Possession of assets by promisor 336 Beneficiary also a promisee 337 Donee and sole beneficiaries 338 Creditor-beneficiaries 340 Mortgagee-beneficiaries 341 Incidental beneficiaries 344 LiabiUty of water companies 345 Contract imder seal 347 Novation distinguished 347 Character of third party's right 348 Rights and powers of promisee 351 Defenses of promisor 352 Massachusetts law 353 New York law 356 Statutory provisions 357 CHAPTER X Assignment in the Law of Contract L Assignment by act of the parties 359 1. Assignment of duties and liabilities 360 2. Assignment erf rights 361 At conunon law 361 In equity: notice; title 364 By statute 369 By the law merchant: negotiable instruments . . 372 TABLE OF CONTENTS PAGE II. Assignment by operation of law 381 1. By transfer of interest in land 382 In case of leasehold interests 382 In case of freehold interests 384 2. By marriage 385 3. By death 386 4. By bankruptcy 387 CHAPTER XI Joint Contracts. Joint and Several Contracts Classification of joint contracts 388 Joint promisors 389 Joint and several promisors 390 Joint promisees 391 Joint or several promisees 392 CHAPTER XII Proof of the Operative Pacts. Rules relating to Evidence Provinces of court and jury 393 Difference in proof of formal and simple contracts .... 394 1. Proof of document piuporting to be contract 395 2. Evidence as to fact of agreement 396 3. Evidence as to terms of contract 398 Supplementary or collateral terms 398 Explanation of terms 399 Proof of usage 401 Extrinsic evidence in equity 403 CHAPTER XIII Interpretation and Construction in the Law of Contract Interpretation and construction distinguished 405 1. Interpretation of words 406 2. Character and determination of conditions 408 Nature of a right 408 Conditions are operative facts 408 Express, implied, and constructive conditions .... 410 Promise and condition distinguished 410 Conditions precedent, concurrent, and subsequent . . . 412 Burden of proof 413 Conditions in unilateral contracts 415 Conditions in bilateral contracts 416 Non-fulfillment of conditions 416 Recognition and determination of conditions .... 417 Waiver of conditions 419 Prevention of fulfillment of condition 420 Doctrine of substantial performance 422 Personal satisfaction as a ccmdition 424 xviii TABLE OF CONTENTS CHAPTER XIV Impossibility in Contraot Law PAGE 1. Non-fulfillment of a condition due to impossibility .... 427 Impossible conditions 427 Non-existence of a contemplated fact 428 2. Npn-fulfiUment of a duty due to impossibility 430 Precedent and subsequent impossibility 430 Change in law . 433 Destruction of subject-matter 434 Incapacity for personal service 435 CHAPTER XV Breach of Contract and its Legal Effect I. What is a breach? Effect of plaintiff's breach .... 437 1. Breach by repudiation 438 Before performance is due 438 After performance is due 441 American note 442 2. ImpossibiUty created by one party 447 3. Failure of performance 448 Non-fulfillment of a promissory condition . . 448 Independent and dependent promises . . . 449 Installment contracts 451 Conditions and warranties 455 Vital terms creating conditions .... 456 Sale of goods 457 Non- vital terms (or warranties) . . . 459 Various meanings of "warranty" . . . 461 Stipulations as to time 462 II. Remedies for breach of contract 463 Secondary rights .......... 463 1. Quasi-contractual rights 464 2. Damages 466 How measured 467 Penalty and liquidated damages .... 47Q 3. Specific reparation in equity . . . . . . 473 Negative covenants 475 PART IV CHAPTER XVI Discharge of Contract I. Discharge by agreement 479 1. Rescission 479 2. Substituted contract 481 Substituted terms 482 Novation 433 TABLE OF CONTENTS XIX Fasb 3. As provided in the agreement when made . . . .483 4. Formalities necessaiy 487 n. Discharge by merger 488 III. Discharge by physical alteration 489 rv. Discharge by performance 491 1. Payment 492 2. Tender 494 V. Discharge of secondary obligation after breach .... 495 Helease or waiver 495 Accord and satisfaction 496 Merger or estopjjel by judgment ...... 497 Statute of limitations 498 Disabilities suspending 499 Revival of rights 500 Bankruptcy 502 PART V AGENCY Agency a form of employment . . 504 Outline of subject 505 CHAPTER XVII Mode in which Agency is created Capacity of parties 507 How relation arises 507 Form of appointment 508 Agency inferred from conduct: estoppel 509 Agency by necessity 510 Batification 511 CHAPTER XVIII Legal Belations of Principal, Agent, and Third Persons L The rights and duties of principal and agent inter se . . . 515 Duties of principal . . 515 Duties of agent 516 Must use diligence 516 Must make no profit other than bis commission . . 516 Must not himself become a principal .... 517 Agent cannot delegate his power: sub-agents . . 520 n. Relations of parties where agent contracts for a named principal . 521 Agent acting within his powers incurs no liabihty . .521 General and special agents 521 XX TABLE OF CONTENTS PAQE Secret instructions do not limit power 522 Particular kinds of agents, auctioneers, factors, brokers, etc. 523 When agent cannot sue or be sued 526 Remedy against agent who contracts without authority . 527 III. Undisclosed principal 529 General rule 529 Contract for unnamed principal 529 Contract not expressly as agent 530 Alternative UabUity 530 rv. Liability of principal for fraud of agent 533 How far knowledge of agent is knowledge of principal . . 535 CHAPTER XIX Determination of Agent's Power 1. By agreement or revocation 537 Effect of revocation as to third parties 537 Power coupled with an interest 539 2. By change of status 540 3. By death of principal 541 PART VI CHAPTER XX Contract and Quasi-Contract Meaning and nature of quasi-contract 543 Debt and assumpsit 543 The indebitatus counts 544 Judgment as a quasi-contract 545 Account stated 545 Money paid by plaintiff for defendant 546 Money received by defendant to plaintiff's use 547 APPENDIX Form of charter-party , . 649 Form of biU of lading 550 Form of policy of marine insurance ....... 551 Forms of bill of exchange and promissory note 552 INDEX 555 TABLE OF CASES Aaron's Reefs v. Twiss 258 Abbott V. Doane 144 Abbott V. Hapgood 613 Ackert v. Barker 294 Ada Dairy Ass'n v. Mears 398 Adams v. Adams (Ala.) 60 Adams e. Adams (Mass.). . .337, 355 Adams v. Adams (Mimi.) 296 Adams ». Adams (N.Y.) 296 Adams v. Gay 272 Adams v. Hotel Co 106 Adams v. Irving Bank 262 Adams v. Kuelm 345 Adams v. Lindsell 42, 43 Adams v. Messinger 17, 129, 473 Adams v. Union R. Co 351 Adams Radiator & Boiler Works w. Schnader 123, 426 Addis V. Gramophone Co 470 Adkins v. Flemming 317 Adolph V. Minneapolis Ry 203 Agius V. G. W. Colliery Co 468 Aheam v. AjTes 62 Ahrens v. Jones 6, 327 Aiken v. Blaisdell 271 Aiken v. Hyde 426 Akin V. KeUogg _ 234 Alaska &c. Ass'n ». Domenico. . .136 Albany v. McNamara 327 Albany City Sav. Inst. v. Burdick266 Albert Lea College v. Brown. . . . 142 Alden v. Thurber 497 Aldrich v. Ames 96 Aldrich v. Carpenter 347 Alexander v. Brogley 203 Alexander v. Morgan 386 Alexander v. Swackhamer .207 Alexander- Amberg & Co. v. Hollis . 64 Alexandria B. Co. v. Miloslowsky . 64 Alger V. Anderson 517 Alger V. Thacher 87, 297 Alie V. Nadeau 80, 498 Alison's Case 89 Allcard v. Skinner 269 Allen V. Baker 435 Allen ti. Brown 367, 370 Allen V. Bryson 149, 150 Allen V. Bucknam 342 Allen V. Bums 419, 424 Allen V. Chouteau 64 Allen V. Collier 602 Allen V. Colliery Engineers' Co.80,498 Allen V. Duffie 272 Allen V. Hammond 209 Allen V. Harris 497 Allen V. Hartfield 451 AUen V. Rescous 284 Allen V. Shreveport W. Co 346 Allen V. South Boston Ry 536 Aller V. Aller 87 Alliance Bank v. Broom 130 Allison V. Chandler 468 Allore V. Jewell 264, 266 Alpaugh V. Wood 389 Alt!;. Stoker 82 Alves V. Schlesinger 265 Alvord V. Smith 66, 273 Amans v. Campbell 530 Amelie, The 89 American Bank v. Doolittle 391 American Lith. Co. v. Ziegler. . .361 American Oil Co. v. Kirk 62 American Pub. Co. v. Walker. . .444 Ames V. Holderbaum 87 Anchor Electric Co. v. Hawkes. .297 Ancrum v. Camden W. Co 346 Anderson v. Best 86 Anderson v. May 431 Anderson v. Pacific Insurance Co.234 Anderson v. Roberts 21 Anderson v. Soward 180 Anderson v. Spence 96 Andrews v. Dyer 400 Andrews v. Mockford 255 Andrews v. Montgomery 80, 545 Andrews v. Ramsay 517 Angel V. Jay 233 Angell V. Duke 100 Anglesey (Marquis of). In re 467 Anglo-American Prov. Co. v. Davis Prov. Co 78 Angus V. Clifford 236, 253 Angus V. Robinson 391 Angus V. Scully 435 Anheuser-Busch B. Ass'n v. Houck 301 Anheuser-Busch Brewing Ass'n V. Mason 305 Anthony v. Harrison 86 Appleby v. Myers 435 Appleton Bank v. McGilvray. . .547 Archer v. Hudson 267 Arend v. Smith 138, 144, 146 xxu TABLE OF CASES PAGE Arff V. Ins. Co 521 Arkansas Valley Smelting Co. v. Belden Mining Co 360, 366 Arkwright v. Newbold 219, 255 Armitage v. Widoe 513 Armstrong v. Jackson 520 Armstrong v. Stokes. . .526, 530, 532 Arnold v. Lyman 353 Arnold v. Nichols 341, 352 Arnold v. Richmond Iron Works. 191 Ashbury Carriage Company v. Riche 189,302,332 Ashcroft V. Butterworth 115 Ashley v. Dixon .330 Ashley v. Henahan 424 Askey v. Williams 171, 173 Associated Port. Cem. M'f'grs. v. Cory 431 Astley V. Weldon 471 Atkins V. Banwell 153 Atkinson v. Denby 314 Atkinson v. Railroad Co 189 Atlantic &c. Co. v. Barnes 244 Atlantic Dock Co. v. Leavitt. . 82, 84 Atlas Bank v. Brownell 243 Atlee V. Backhouse 262 Attleborough Bank v. Security LCo 355 Attorney Gten. v. Amer. Leg. of Honor 349,354,356 Attorney Gen. v. Great Northern R. Co 301 Atwell V. Jenkins 122, 191 Atwood B. Chapman 245 Audette v. L'Union St. Joseph. .418 Auditor v. Ballard 30 Auerbach v. Le Sueur Mill Co 188 Aultman v. Kennedy 150 Aultman v. Olson 203 Austin V. Wacks 462 Austrian & Co. v. Springer 103 Auten V. Gruner 204 Avery v. Bowden 440, 441 Avery v. Everett 164 Ayer v. IQlner 483 Ayer v. W. IT. Tel. Co 205 Ayers v. Bums 171 Ayers v. Dixon 351 Ayerst v. Jenkins 295, 309 Aylesford (Earl of) v. Morris 264 B Babbett v. Young 531 Babbitt v. Bennett 83 Babcock v. Hawkins 497 Babcock v. Lawson 19, 259 Babcock v. Read 100 Bach V. Levy 457 Bach V. Tuch 258 Badger v. Phinney 185 Bagel V. Miller 48 Bagge V. Slade 137 j PAGE Bagley v. Fletcher 182 Baguely v. Hawley 462 Bailey v. Austrian 52 Bailey v. Bamberger 178, 184 Bailey v. Bussing 546 Bailey v. Dillon 296 Bailey v. Marshall 98 Bailey v. Sweeting 102 Baillie's Case 207 Baily v. De Crespigny 433 Bainbridge v. Firmstone 120 Baines v. Geary 303 Baird v. Baird 87 Baird v. Mayor 259 Baird v. Tolliver 471 Baiz, In re 164 Baker v. Baker 83 Baker v. Burton 272 Baker v. Hedgecock 303 Baker v. HiggLns 452 Baker v. Holt 50 Baker v. Morris 98 Baldwin v. Emery 351 Baldwin Bros. v. Potter 516 Balkis Co. v. Tomkinson 237 Ballard v. Home Nat'l Bank.. . .341 Ballou V. BiUings 444 Ballou V. Earle 32 Ballou V. Talbot 527 Baltimore &c. R. v. O'Donnell. .433 Baltimore & S. R. v. Faimce. . . .547 Baltzen v. Nicolay 235, 527 Bangor Bank v. Treat 391 Bangs V. Dunn 289 Bank v. Anderson 243 Bank v. Board of Commissioners 79 Bank ». Davidson 494 Bank v. Johns 203 Bank v. Kiug 303 Bank v. Partee 192 Bank v. Patterson 90 Bank v. Railroad Co 189 Bank v. Sperry Flour Co 46 Bank of England, Ex parte 498 Bannerman v. White. .227, 228, 232 Barber v. International Co 78 Barber i;. Kendall 80 Barbre v. Goodale 400 Barclay v. Pearson 66, 317 Bardwell v. Purrington 165 Barge v. Haslam 99 Barker v. Bucklin 341 Barker v. Dinsmore 19, 207 Barker v. Hibbard 173 Barker v. Mann 193 Barker v. Thayer 149 Barlow v. Ocean Ins. Co 130 Barnard v. Gantz 264 Barnes v. Brown 467 Bames v. Gibbs 80 Barnes v. Leidigh 452 Bames v. Shoemaker 206 TABLE OF CASES XXIU Bamett v. Speir 229 Barney v. Bfiss 494 Baroness Wenlock v. River Dee Co 189 Barr v. Packard Motor Co 185 Barrell v. Newby 532 Barrett v. Bujrton 191, 396 Barrett v. Garden 86 Barrett v. McHugh 97 Barrow v. Dyster 530 Barrus v. Phaneuf 135 Barry v. Croskey 255, 256 Barter, Ex parte 285 Bartholomew v. Finnemore 184 Bartholomew v. Jackson 31, 148 Bartlett v. Odd Fellows Sav. Bank 165 Bartlett v. Wells 183 Bartlett v. Wyman 136 Barton v. Gray 421, 482, 487 Barwick v. English Joint Stock Bank 534 Baasett v. Brown 258 Bassett v. Hughes 347, 352 Basye v. Adams 283 Bateman v. Faber 196 Bates V. Boston &c. R 82 Bath Gas Light Co. v. Claffy. . . 190 Batterbm-y v. Vyse 418, 420 Baum V. Baum 296 Bawden v. London & Cy. Assur- ance Co 536 Baxter v. Burfield 386 Baxter & Co. v. Jones 134 Bayley v. Homan 493, 496 Bayne v. Wiggins. 104 Beach v. First M. E. Church 47 Beach ».U. S 36 Beadles v. Bless 276 Beard, Re 289 Beatty v. Howe Lumber Co 454 Beatty v. Western College 142 Beauchamp (Earl) v. Winn 404 Beaumont v. Greathead 467 Beaumont v. Reeve 295, 309 Beaupr6 v. Pacific &c. Co 62 Bechuanaland Exploration Co. e. London Tradmg Bank 377 Beck V. Allison 474 Beck V. Kittanning W. Co 346 Beck &c. Co. V. Colorado &c. Co. 462 Becker v. Boon 495 Becker v. Keokuk Waterworks. .346 Becker v. London Assur. Corp . 7, 405 Beckham v. Drake 526 Beckwith v. Talbot 104, 396 Bedford (Duke of) v. Ellis 334 Beebe v. Johnson 129 Beebe v. Young 230 Beecher v. Conradt 413, 450 Beeman v. Banta 469 Beetle v. Anderson 250 Begbie o. Phosphate Sewage Co. 285 Behn v. Burness 223, 456, 461 Belknap v, Sealey 231 Belli). Balls 523 Bellamy v. Debenham 65 Bellows V. Sowles 95, 132 Bell's Gap R. R. t;. Christy 513 Benanti v. Delaware Ins. Co ... . 415 Bender v. Been 87, 137 Benge v. Hiatt 339 Beninger v. Corwin 245 Benjamin v. Dockham. .12, 509, 511 Bennett v. HiU 327 Bennett v. McLaughlin 185 Bennett v. Mattingly 21 Bennett v. Stevenson 471 Bennett v. Tighe 294 Bennett v. White 370 Bennetto v. Holden 187 Bentw. Cobb 523 Bentley v. Vilmont 259 Benton v. Pratt 330 Benton v. Singleton 310 Benton v. Springfield &c. Ass'n 4, 29, 68 Benton County Bank v. Boddicker 310 Berg V. Erickson 431 Bergh v. Warner 509 Berkeley v. Elderkin 80 Berkshire Life Ins. Co. v. Hutch- ings 352 Bernard v. Taylor 276, 317 Berry v. Ins. Co 248 Berwin v. Bolles 115 Best V. Givens 178 Bestor v. Hickey 180 BetheU v. BetheU 249 Bettini v. Gye 459 Beymer v. BonsaU 532 Bibb ti. Allen 515 Bibelhausen v. Bibelhausen 84 Bickerton v. Burrell 526 Bickle V. Beseke 492 Bidder v. Bridges 497 Bierce v. Red Bluff Hotel Co. . . .535 Bierman v. City Mills Co 460 Bigelow V. Benedict 281 Biggers v. Owen 39, 51, 54 Bignall v. Gould 472 Billings's Appeal 386 Billington v. Cahill 101 Binford v. Adams 327 Bingham v. Bingham 210 Bird V. Brown 513 Bird V. Munroe 20, 102, 108 BirdsaU v. Russell 490 BirkmjT v. Darnell 97 Birmingham Land Co. and Allday, In re 385 Bisbee v. McAllen 272 Bishop V. Eaton 24, 41 XXIT TABLE OF CASES Bishop V. Palmer 298, 303 Bixby V. Moor 27, 303 Blachford v. Preston 288 Black V. Grabow 41 Black t). Maddox 54 Blackburn v. Mann 99 Blackburn v. Reilly 454 Blackburn v. Vigors 535 Blackstone v. Buttermore 639 Blackwell v. Hamilton 82 Blade v. Noland 491 Blagbourne v. Hunger 487 Blair v. Bromley 600 Blaisdell v. Ahern 294 Blake u. Hamburg &c. Co 46 Blake v. Voight 101 Blakeman v. Fonda 502 Blandford v. Andrews 422 Blasdel v. Fowle 310 Bless V. Jenkins 102 Blewitt V. Boorum 65, 84, 398 Blinn v. Schwartz 191 Block V. Darling 315 Blood F. La Serena &c. Co 90 Bloomenthal v. Ford 237 Bloomer v. Bernstein 455 Bloomfield v. Maloney 67 Bloomquist v. Farson 233 Bloss V. Kittridge 150 Blount V. Wheeler 132 Bloxam v. Sanders 451 Blunk V. Dennison W. Co 346 Boardman v. Larrabee 351 Boddies v. Brewer &c. Co 310 Boddy V. Henry 250 Bodine v. Commonwealth 81 Bodman v. Am. Tract Society. . .407 Bogan V. Daughdrill 241 Boggs V. Curtin 392 Bohanan v. Pope 341, 347 Boigneres v. Boulon 295 Bokemper v. Hazen 191 Bolivia Explor. Syndicate, In re 164 Bollenbacher v. Reid 65 Bollman v. Burt 455 BoUman v. Loomis 516 Bolton V. Madden 120 Bonacina, Re 156, 160 Bonnard v. Dott 313 Bonynge ». Field 525 Boody V. McKenney 179, 181 Bool V. Mix 183 Booth V. Eighmie 98 Booth V. Spuyten Duyvil Rolling Mill Co 468 Booth V. Warner 362 Boothe V. Fitzpatrick 150 Borckerling v. Katz 626 Borden v. Boardman. .337, 341, 354 Bors V. Preston 164 Borst V. Corey 499 Borst V. Spelman 192 Bosden v. Thinne 152 Bosley v. National Machine Co. . 242 Bostock V. Nicholson 458, 468 Boston ». Boston 99 Boston Ice Co. v. Potter. 31, 206, 626 Boston & L. R. Co. v. Nashua & L. R. Co 292 Boston & Maine R. v. Bartlett.25, 57 Boston Safe Deposit and Trust Co. V. Salem Water Co. . . 345, 346 Boston S. D. Co. v. Thomas 411 Bostwick V. Ins. Co 268 Boulton V. Jones 206, 208 Bourlier Bros. v. Macauley 330 Bourne v. Mason 332 Bouton V. Welch 338, 339, 356 Bowditch V. New England Mutual Life Ins. Co 313 Bowen v. Bailey 450 Bowen v. Hall 329 Bowen v. Prudential Ins. Co. . . . 83 Bowers v. Great Eastern Cas. Co.415 Bowers v. Whitney 106 Bowers &c. Co. v. Hess 132 Bowery Nat. Bk. v. Wilson 289 Bowker v. Hoyt 148 Bowman, In re 309 Bowman v. Secular Society 309 Bowman v. Taylor 84 Boyd «. Hind 142 Boyd's Ex'rs v. Browne 254 Boydell v. Drummond 104 Boyden v. Boyden 181 Boyer v. Berryman 191 Boyer v. Richardson 327 Boyer v. Soules 96 Boyle V. Adams 288 Boyle V. Guysinger 459 Boynton v. Hazelboom 230 Boynton v. Hubbard 265 Boyson v. Thorn 329 Bozeman v. Browning 181 Brackett v. Griswold. .255, 256, 295 Braden v. Ward 87 Bradford v. Roulston 151, 152 Bradlaugh v. Newdegate 294 Bradley v. Pratt 171 Bradley v. Rogers 87 Bradley Salt Co. ». Norfolk Imp. Co 82 Bradshawp. Combs 399 Bragg V. Danielson 481 Bragg V. Wetzell 389 Brainerd v. Dunning 512 Braman v. Bingham 83 Brandner v. Krebbs 31 Brandon v. Nesbitt 163 Brandts «. Dunlop Rubber Com- pany 367,371 Branin v. Blair 64 Brantley v. Wolf 183, 184 Brashfordw.Buckinghamandwife 192 TABLE OF CASES PAQB Brauer v. Campania Navigacion La Flecha 485 Brauer v. Shaw 43, 55 Braunn v. Keally 272 Bray v. Kettell 526 Brett V. Marston 490 Bretto V. Levine 399 Brewer v. Dyer 353 Brewer v. Horst and Lachmund Co 104 Brewster v. Banta 157 Brewster v. Hatch 242 Brice v. Bannister 371 Brick V. Gunnar 99 Bridge v. Conn. Ins. Co 368 Bridger v. Goldsmith 82 Bridger v. Savage 306 Briggs V. Boyd 262 Briggs V. Holmes 494 Bri^ V. Partridge 526 Bdgnam v. Fayerweather 191 Britain v. Rossiter 108 British South Africa Co. v. De Beers Mines 160 British Waggon Co. «. Lea. . 360, 365 Brittain v. Lloyd 149 Britton V. Green Bay W. Co 346 Britton 0. Turner 466 Brodrib v. Brodrib 191 Brogden v. Metropolitan Railway Company 3 Bromley v. Smith 175, 303 Bronnenberg ». Cobum 135 Brook V. Hook 514 Brooke ». Logan 297 Brooks t). BaU 10, 121, 124 Brooks V. Cooper 288 Brooks V. Hamilton 230 Brooks V. Riding 229 Brower v. Goodyer 248 Brown v. Bank 288 Brown v. Bign6 294 Brown v. Browning 320 Brown v. B3me 402 Brown v. Duncan 271 Brown v. Eastern R 33 Brown ». Farmers' &c. Co 107 Brown v. Famham 142 Brown ». Foster. 425 Brown v. Ginn 294 Brown v. Hall. 266 Brown v. Hiatts- 162 Brown v. Kinsey 88, 295, 309 Brown v. Enapp 337 Brown v. Lamphear 216, 404 Brown v. Mercantile Trust Co. . 264 Browne. Montgomery. 213, 245, 267 Brown v. Nealley 284 Brown v. New York Central R. . 64 Brown v. Pitcaim 257 Brown v. Reiman 632 Brown v. Rushton 413 PyLGB Brown v. Sanborn 114 Brown v. Tuttle 295 Brown v. Woodbury 464 Brownlie v. Campbell 252 Bruce v. Bishop 60 Brucker v. Manistee R.R. Co. . .421 Brunswick Gas Light Co. v. United Gas Fuel & Light Co 190 Brusie v. Peck Bros 451 Bryan «. Brazil 631 Bryan v. Watson 272 Bryant v. Herbert 74 Bryant v. Isburgh 459 Bryce i'. Clark 514 Bryne v. Dorey 370 Bryson v. Haley 305 Buchanan v. Hubbard. 179, 180, 181 Buchanan i>. Ins. Co 282 Buchanan v. Tilden 127, 340, 343,356 Buckley v. Humason 272 Budgett V. Binnington 432 Buelt). Miller 488 Buhl V. Stephens 108 Bull V. Talcott 70 Bullitt V. Farrar 250 Bunker v. Miles 516 Burdett v. Williams 180 Burge V. Ashley & Smith, Ld.279, 318 Burges v. Wickham. . .398, 400, 401 Burgess v. Eve 244 Burkhalter v. Jones 215 Burkholder v. Beetem 308 Burks V. Stam 60 Burn V. Miller 465 Burnard v. Haggis 186 Burney v. Ryle & Co 475 Bums V. Daggett 108 Burns v. Lane 248 Bums V. Real Estate Co 488 Burr V. Beers 342 Burrell's Case 247 Burrell v. HighlejTnan 114 Bvurill V. Nahant Bank 508 Burritt v. Ins. Co 239 Burroughs v. Pac. Guano Co 204 Bursinger v. Bank 191 Burson v. Huntington 205 Biuiiis V. Thompson 439 Burton v. Gage 368 Burton v. Henry 392 Bush V. Breinig 191 Bush V. Cole 523 Bush V. Genther 83 Bush V. Water Co 346 Butcher v. Krauth 620 Butler & Baker's Case.. . .24, 38, 53 Butler V. Duncan 266 Butler V. Legro 294 Butler V. Maples 522 Butler V. New York & E. R.R. Co. 365 Butler i;. Tucker 426 Butts V. Phelps 516 XZVl TABLE OF CASES PAOE Buxton V. Barrett 367 Buxton V. Rust 103 Byers v. Sun Sav. Bank 164 Byington v. Simpson 400, 529 "Byrne v. Massasoit Packing Co. . 523 Byrne v. Van Tienhoven 55 C Caddick v. Skidmore 104 Cade V. Daly 301 Calais Steamboat Co. v. Van Pelt 89 Caldwell v. Davis 244 CaldweE v. School Dist 129 Callis V. Day 181 Callisher v. Bischoffsheim 130 Calthorpe's Case 117 Cammack v. Lewis 283 Campbell v. Holt 499 Campbell v. Lacock 345 Campbell v. Mercer 28 Campbell v. Richardson 276 Campbell Printing Press Co. v. Thorp 426 Canadian Agency v. Assets R. Co.233 Canajoharie N. B. v. Diefendorf . 376 Canal Co. v. Ray 487 Cauda v. Wick 441 Candee v. Smith 390 Cannan v. Bryce 305 CanneU v. Smith 517 Canning v. Parquhar 63 Cape May R. E. Co. ». Hender- son 419, 438 Capen v. Barrows 392 Capital and Counties' Bank v. Rhodes 489 Card V. Hope 288 Carew v. Rutherford 547 Carey v. Dyer 88 Car^I V. Thompson 402 Carlill V. Carbohc Smoke Ball Co. 29, 37, 67, 70 Carlisle Banking Co. v. Bragg 204, 205 Carmichael's Case 539 Carnegie Steel Co. v. TJ.S 431 Carney v. Plimmer 279 Carpenter v. Carpenter 183, 185 Carpenter v. Ins. Co 521 Carpenter v. Rodgers 191 Carpenter v. Taylor 136 Carr v. McCarthy 101 Carr v. Nat. Bk 230 Carrington v. Harway 362 Carroll v. Bowersock 434 Carstens v. McDonald 442 Carter v. Beckwith 191, 192 Carter v. Ferguson 475 Carter v. Silber 177 Carter v. United Ins. Co 364 Cartwright v. Cartwright 297 Caxtwright v. Hoogstoel 59 FAQB Carver v. Eads 342 Case V. Case 345 Cash V. Clark 102 Cassaboglou v. Gibbs 618 Casselman v. Gordon 342, 344 Cassidy v. Caton 471 Castellain ». Preston 282 Catholic F. M. Society v. Ous- sani 419, 438 Catlin V. Haddox 180 Catlin V. Tobias. 466 Cator V. Burkes 362 Cavanaugh ». Casselman 489 Central Shade Roller Co. ». Cush- man 300 Central Trans. Co. ». Pullman Car Co 91,190 Central Trust Co. v. Chicago Auditorium 433, 442, 447 Cesar v. Karutz 247 Chalfant v. Pay ton 296 Chalmers, Ex parte 486 Chamberlain v. Beller 308 Chamberlain v. Stanton 83 Chamberlain v. Williamson 386 Chamberlin v. Whitford 150 Chambers v. Atlas Ins. Co 412 Chambers v. Baldwin 330 Chambers v. Seay 539 Champlain Co. v. O'Brien 144 Champlin v. Rowley 466 Chandler v. Simmons 181, 185 Chandler v. Webster 429 Chanter v. Hopkins. . .457, 460, 461 Chapin v. Dobson 399 Chapin v. Shafer. .1 182 Chaplin v. Hicks 469 Chapman v. Cole 209, 211 Chapman v. Rose 203 Chamley v. Winstanley 540 Charter v. Trevelyan 259 Chase v. Chase 541 Chase v. Corcoran 31 Chase ». Debolt 525 Chase ». Fitz 387 Chase N. B. v. Faurot 189 Chastain v. Zach 507 Chatfield Co. v. O'Neill 292 Chatham Furnace Co. v. Moffatt 221, 250 Chaude v. Shepard 472 Cheltenham &c. Co. v. Gates Iron Works 494 Cherry v. Heming 82 Cheshire v. Barrett 181 Chevei-ont v. Textor 284 Chicago !). Babcock 479 Chicago V. Sexton 464 Chicago V. Tilley 447 Chicago B. & Q. R. Co. ». Dockery 471 Chicago &c. Ry. v. Belliwith. . . .203 TABLE OF CASES xxvu Chicago &c. B,y. v. Dane 52 Chicago &c. Ry. v. Lewis 191 Chichester v. Vass 60 Chipman v. Morrill 390, 546 Chouteau v. Gibson 79 Chouteau v. Jupiter Iron Works. 479 Christie v. Borelly 123 Christmas v. Russell 79 Chrysler «. Canaday 234, 247 Church «. Proctor 284,308 Church V. Spicer 140 Churchill Co. v. Newton 442 Churchill v. White 186 Chute V. Pattee 136 Chute V. Quincy 215, 217, 403 Chytraus v. Smith 44 Cicotte V. Church of St. Anne. . . 27 City of Findlay v. Pertz 517 City of New York, In re 165 CityTrust Co. «. Am. Brewing Co. 531 Clabbon, In re 145 Claflin V. Lenheim 539 Claflin V. Ostrom 341 Clandeboye, The 17, 238, 245 Clapp V. Pawtucket Inst 392 Clare v. Hatch 355 Clark V. Abbott 138 Clark V. Allen 283 Clark V. Billings 362 Clark V. Fey 488 Clark V. Fosdick 296 Clark V. Gaylord 133 Clark V. Hovey 411, 421 Clark w. Ins. Co 239 Clark V. Manchester 464 Clark V. Marsiglia 444, 446, 469 Clark V. Patton 391 Clark V. Pearson 60 Clark V. Pease 311, 375 Clark V. Potts 36 Clark V. Van Court 180 Clarke v. Dunraven 23, 66 Clarke v. Morey 162 Clarke v. Watson 412 ClarksviUe Land Co. v. Harri- man 431 Clason V. Bailey 106 Clay V. Freeman 499 Clay V. Yates 284 Clay Lumber Co. v. Coal Co 96 Clayton v. Clark 119, 137 Cleary v. Sohier 435 Clegg V. Hands 383, 475 Cleghom v. Zumwalt 211 Clemans v. Supreme Assembly &c 240 Clement v. Cash 472 Clements v. L. & N. W. R. Co. 174, 184 Clifford V. Luhring 98 Clifford V. Watts 430, 462 Clifton V. Jackson Iron Co. . .85, 489 Clodfelter v. Cox 368 Clough V. L. & N. W. R. Co. . . .259 Clough V. Seay 490 Coates V. Buck 211 Cobb V. Monjo 392 Codd Co. V. Parker 532 Coddington v. Bay 159 Coe V. Hinkley 367 Coe». Tough 396 Coffey V. Commonwealth. 30 Cohn V. Plumer 64 Cohrt V. Koch 352 Colboum V. Rossiter 362 Colby V. Dearborn 396 Cole V. Fickett 404 Cole V. Gibson 296, 316 Cole V. Hughes 384 Coleman v. Applegarth 59, 462 Coleman v. Whitney .339 Coleman v. Wolcott 362 Coles V. Trecothick 121, 265 Colgate V. Bacheler 297 Collen V. Wright 234, 462, 528 Collier v. Baptist Ed. Soc 143 Collins V. Blantem 88 Collins V. Evans 251 Collins V. Godefroy 135 Collins V. Locke 301 Collins V. Stove Co 327 Collins V. Westbury 262 Collyer v. Moulton, 139, 444, 480, 483, 496 Colson's Case 44, 46 Colt a. Miller 414 Columbus &c. Ry. v. Gaffney 12, 543 Comley v. Dazian 326 Commercial N. B. v. Kirkwood. . 352 Commins v. Scott 103 Commonwealth v. Emigrant Bank 490 Commonwealth v. Pittsbiffgh. . .188 Compton V. Jones 363 Comstock V. Fraternal Accident Ass'n 428 Conant w. Evans 153 Condon v. Barr 157 Conflans Quarry Co. v. Parker. . .491 Conger v. Ry 474 Congress Spring Co. v. Knowlton 308, 315 Conkey v. Bond 616, 517 Conlan v. Roemer 250 Conn V. State 353 Connelly v. Devoe 136 Conner v. Plank 64 Connolly v. Sullivan 441, 464 Connors o. Connolly 301 Conrad v. Waples 162 Consolidated E3£ploration and Fi- nance Company v. Musgrave. .290 Constable v. Cloberie 410 Constant v. University of Roches- ter 536 xxviu TABLE OF CASES Continental Ins. Co. v. Easey. . 239 Cooch V. Goodman 82 Cook V. Bradley. . .77, 116, 118, 125 Cook ». Chicago R 547 Cook V. Oxley 56, 57 Cook V. Wright 130 Cooke V. Millard 114 Cooke V. Nathan 248 Coomber, Re 266 Cooper V. Foss 342 Cooper V. Kane 402 Cooper «. Lansing Wheel Co . . . 49, 50, 51 Cooper V. Phibbs 210, 248 Cooper V. Potts 400 Cooper V. Shaeffer 283 Cope V. Rowlands 271 Copenrath v. Kienby 191 Coplay Iron Co. v. Pope 211, 227, 458, 460 Coppola V. Rraushaar 470 Corbett v. Clute 290 Cordes v. Miller 433 Corey v. Biirton 179 Corn V. Matthews [1893] 1 Q. B. 174, 310 Coming v. Burton 342 Cornish v. Stubbs 383 Cornish &c Co. «. Dairy Ass'n. .424 Cornish & Co. v. West 389 Corrigan v. Detsch 124 Corson's Appeal 283 Cort c. Ambergate Railway Co. 441, 444 Cort V. Lassard 17, 473, 475 Cosgrove v. Cummings 86 Costello V. Ten Eyck 272 Coster V. Albany 346, 357 Cotheal ». Talmage 472 Cottage St. Church ». Kendall. .143 Couldery v. Bartrum 140 Coulter V. Clark 247 Coursolle v. Weyerhauser. . 177, 507 Couturier v. Hastie 209 Coverdale v. Eastwood 222 Cowan V. Milbourn 308, 309 Cowan V. O'Connor 46 Cowdin V. Gottgetreu 97 Cowee V. Cornell 264, 268 Cowles V. Marble 494 Cowles V. U.S. Fidelity Co 363 Cowley V. N. P. R.R. Co 433 Cowley V. Smith 219 Cox V. Maddux 390 Coxhead v. Mullis 176 Coykendall v. Blackmer 411 Coyner v. Ljmde 136 Crabill v. Marsh 110 Crabtree v. May 167 Craig V. Lane 420 Craig V. Van Bebber 182, 184 Craigie v. Hadley 635 CrandaU v. Willig 88, 264, 474 Crane v. Ailing 391 Crane v. Crane 52 Crane ». Elder 234 Crane v. Gruenewald 510 Cranson v. Goss 272, 311 Crawford v. Millspaugh 481 Crawford v. Pub. Co 426 Crawford v. ScoveU 191 Cream City Glass Co. v. Fried- lander 526, 531 Creamery Package Mfg. Co. v. Creamery Co 468 Crears v. Hunter 29 Creigh v. Boggs 423 Cresinger v. Welch's Lessee 182 Cribbens v. Markwood 266 Cromwell v. County of Sac 79 Crone v. Stinde 342 Cronin v. Chelsea Bank 367 Cronmire, Re 281 Croockewit o. Fletcher 490 Crooks V. Nippolt 258 Cross V. Cross 296 Crosse v. Gardner 225 Crossley v. Moore 284 Crouch V. Credit Foncier. . . 368, 376 Crouch V. Gutmann 424 Crowe V. Lewin 362 Crowell V. Hospital 347 Crowley v. Langdon 248 Crowther v. Farrer 497 Croyle v. Moses 245 Crumlish's Adm'r v. Central Im- provement Co 327 Culton V. Gilchrist 63 Cumber v. Wane 137 Cummings ». Arnold 488 Cummings «. Gann 30, 149 Cummings v. People 391 Cummings v. Powell 182 Cummings v. Union Blue Stone Co 300 Cundy v. Lindsay 19, 207 Cunningham v. Dunn 287, 433 Currie v. Misa 116, 122 Curry v. Curry 27 Curry u. Ry 392 Curtice v. City of London & Mid- land Bank 56 Curtis V. Innerarity 467 Curtis V. Van Bergh 471 Cushing V. Arnold. 80 Cushman v. Ins. Co 240 Cutter V. Cochrane 138 Cutter V. Gillette 441 Cutter V. Powell 455 Cuxon V. Chadley 363 D Da Costa v. Jones 276 Dade Coal Company v. Haslett. . 164 TABLE OF CASES XXIX PAOB Dafley Co. v. Can Co 52 Daily v. Minnick 339 Daimler ». Continental Tyre Co . 162 Dakin v. Lee 465 Dalby v. The India and London Life Assurance Company 283 Da Lee v. Blackburn 219 Dalton V. Mid. Coun. R. Co 192 Daly V. Smith 475 Dambmann v. Rittler 54 Dambmann v. Schulting 244 Danforth v. Ry 358 Daniels, Li re 540 Daniels v. Johnson 350, 353 Daniels v. Newton 442, 444 Daniels v. Trefusis 110 Danziger ». Hoyt 327 D'Arcy v. Lyle 515 Darew. Hall 136 Darling v. Butler 83 DarreD v. Tibbetts 282 Darrow v. Home Produce Co. . .531 Dart V. Sherwood 389 Dartmouth College v. Woodward 13 Davenport v. First Cong. Soc. . .146 Davidson v. Little 265 Davie v. Mining Co 52 Davies v. Bronson 444 Davies v. Davies 61, 129 Davies ». London Ins. Co 243 Davies v. Lyon 633 Davis V. Belford 389 Davis V. Campbell 143 Davis V. CUnton W. Co 345, 346 Davis V. Davis 344, 350, 353 Davis V. Foreman 476 Davis V. Hamlin 517 Davis V. Hardy 348 Davis V. Lane 541 Davis V. Nuzum 219 Davis V. Patrick 97, 98 Davis V. Railroad Co 190 Davis V. Reisinger 213 Davis V. Van Buren 390 Davis V. Wells 41 Davis Sewing Machine Co. v. Richards 41 Davison v. Von Lingen.223, 456, 463 Davys v. Buswell. 98 Dawe V. Morris 248 Dawkins v. Sappington 30, 67 Dawson v. G. N. & City Rly. . . .365 Day V. Caton 27 Day V, Gardner 144 Day V. McAllister 272 Daylight Burner Co. v. Odlin 510, 523 Dean v. Amer. Leg. of Honor 354, 356 Dean v. Emerson 303 Dean v. Richmond 193 Dean v. Walker 342 Deaxbom v. Bowmas. , 149 PAGE Debenham v. Mellon 509, 538 De Bussche v. Alt 620 Decell V. Lewenthal 173 De Ciccow.Schweizer.124, 125, 144, 146, 338, 340, 343, 356 De Cremer v. Anderson. , 41 Deere v. Morgan 248 De Francesco v. Bamimi 174 De Kay v. Bliss 449 De la Bere v. Pearson 121 Delamater v. Miller 447 De Lassalle v. Guildford. . . 222, 225 Delaware & H. C. Co. v. Penna. Coal Co 291 Delier v. Plymouth &c. Soc . . .66, 273 Delz V. Winfree 330 De Mattos v. Benjamin 279 Demeules v. Jewel Tea Co 139 Deming v. Darling 234 Denby v. Mellgrew 327 Denton v. G. N. Railway Co ... . 69 Denver Fire Ins. Co. v. McClel- land 190,237 Derby v. Johnson 441, 464 Derby v. Phelps 99 De Remer v. Brown 530 Dermott v. Jones 431 Derocher v. Continental Mills 178, 184 Derry Bank v. Webster 24, 53 Derry v. Peek 220, 233, 235, 236, 249, 251, 252 Des Arts v. Leggett 491 Desmond Dvinne Co. v. Fried- man-Doscher Co 424 Dettra v. Kestner 259 Devecmon v. Shaw 120, 126 Devlin v. Mayor 361 Devoe v. Brandt 248 Dewar ». Goodman 382 Dewees v. Lockhart 494 Deweese ». Muff 542 Dewey v. Union School District &c 435 De Wutz V. Hendricks 287 Dexter v. Blanchard 97 Dexter v. Hall 191 Dexter v. Norton 434, 435 Deyo V. Hammond 428 Dezell V. Fidelity &c. Co 420 Diamond Match Co. v. Roeber 300, 473, 477 Dickenson v. Barrow 110 Dickinson v. Calahan's Adm'r. . .386 Dickinson v. Dodds 49, 57 Dickson v. Renter's Telegraph Co 249 Diem v. Koblitz 431 Dienst ». Dienst 99 Dietrich v. Hoefelmeir 102 Din V. Bowen. 185 Di Lorenzo v. Di Lorenzo 5 TABLE OF CASES PAGE Dimmock v. Hallett 234 Dingley v. Oler 442, 444 Diono. St. JohnSoc 273 Distilled Spirits, The 535 Ditoham v. Worrall 176 Dixon V. Clarke 495 Dixon V. Henderson 429, 431 Dixon V. Sadler 462 Dobson V. Espie 480 Dockery p. McLellan 294 Dodge V. Emerson 494 Dodge V. Stiles 135 Doe d. Gamons v. Knight 53 Doe V. Leggett 182 Doggett V. Emerson 230 Doheny v. Lacy 267, 268 Doherty v. Hill 104 Doherty v. Schipper 446 Doll V. Crume 339, 353 Doll r. Noble 426 Donellan v. Read 102 Donnell v. Manson 391 Donnelly v. Currie Hardware Co . 64 Donnelly v. Newbold 144 Donovan v. Ward 180 Doremus v. Hennessy 329 Dorr V. Cory 247 Dorr V. Fisher 226 Dorsey v. Kyle 162 Douglas V. Rhyl IT. D. Cy 91 Dow V. Clark 353 Dow V. Syracuse &c. R 137 Dowie V. Driscoll 267 Downing ». Stone 183 Doyle V. Dixon 101 Drake v. Beckham 387 Drake v. Seaman 105 Drake v. Vorse 52 Dreifus&cCo.w. Salvage Co. 479,481 Drennan ». Douglas. 309 Drew V. Goodhue 424 Drew V. Nunn 540 Dreyfus ». Roberts 138 Driggs B. Bush 115 Droege v. Ahrens 268 Drude v. Curtis 184 Drummond v. Crane 386 Drury v. Young 103 Dueker v. Whitson 86 Duff V. Russell .475 Duffany v. Ferguson. 248 Dun V. City Nat. Bank 328 Duncan v. Ins. Co 209 Duncan v. Miller 159 Duncan &c. Co. v. Niles 527 Dunham v. Griswold 546 Dunham v. Pettee 451 Dunlap V. McNeil 341 Dunlop V. Higgins 43, 44 Dunlop V. New Garage Co 471 Dunlop I). Selfridge 119, 126, 127, 331, 338, 355 PAGE Dunn V, Dujm 268 Dunne v. Herrick, 294 Dunning v. Leavitt 352 Dunphy v. Ryan 107 Dunton ». Dunton.39, 120, 125, 129 Duplex Safety Boiler Co. v. Gar- den 123,424,426 Dupont Powder Co. v, Sohlott- man. 411,421 Durbin v. Kuney 390 Durham v. Robertson 370 Durkee v. Vermont C. R. Co. . . .205 Durnford v. Messjter 327 Durnherr v. Rau,.339, 343, 345, 356 Duryea ». Hiarvey 367 Dusenbury v. Hoyt 156 Dusenbury v. Speir. 543 Dustan ». McAndrew 446 Dutch V. Warren 464 Dutton V. Dutton 193 Dutton V. Poole 127, 336, 339 Duval V. Wellman. 296, 314, 316, 547 Dyer v. Hargrave 423 E Eames ». Preston 82 Earl of March 0. Pigot 123 Earle v. Oliver. 155 Earle v. Reed 171 Easterly v. Barber 390 Eastern To:wnshipa Bank v. Beebe 80 Eastland v. Burchell. 510 Eastman v. Miller 137 Eastman v. Wright 3, 8 Easton v. Driscoll 84 Eastwood V. Kenyon 96, 126, 154, 158 Eaton ». Avery. 254 Eaton ».. Eaton. 264 Eaton w.Fairbury Waterworks. .346 Eaton ». Gladwell 402 Eaton V. Hill 186 Eaton V. Kegan, 272 Eaton V. Libbey 127, 354 Ebert v. HaskeU 284 Eblingw.Ebling 452 Eddy V. Davis 450 Edelstein v. Schuler & Co 377 Edge Moor Bridge Works v. County of Bristol 68 Edgerly v. Shaw 179 Edgerton v. Thomas 510 Edgerton v. Weaver. 29, 130 Edgerton v. Wolf 182 Edgington v. Fitzmaurice 250 Edison v. Babka 360 Edmunds ti. Bushell and Jones. .523 Edmunds v. Merchants' &c, Co. 19, 207 Edmunds v. Mister 179 Edmundson's Estate, In re 339 TABLE OF CASES FAOE Edwards v. Aberayron Insurance Society 290, 396 Edwards v. Carter 177 Edwards v. Nelson 126, 156 Edwards v. Thoman 341 Egerton v. Earl Brownlow. . 286, 289 Egger V. Nesbitt 62 Eggleston v. Buck 391 Eggleston v. Wagner 508 Ehle V. Purdy 391 Ehrman v. Bartholomew 476 Eicholz V. Bannister 462 Elder v. Chapman 444 Elderton v. Emmens 151 Eldred v. Malloy 276 Eldridge v. Walker 519 Eley V. Positive Assurance Co. 332, 333 Eliason v. Henshaw 49 Elison V. Wulff 523 Elizabeth v. Force 490 Eller V. Lacy 389 Elliott V. Caldwell 424 Ellis V. Andrews 247 Ellis V. Harrison 358 Ellis V. McLemoor 392 Elsee V. Gatward 134 Ely V. Hallett 238 Embrey v. Jemison 306, 311 Emerson v. Townsend 310 Emery v. Cobbey 36 Emery v. Kempton 308 Emery v. Ohio Candle Co 300 Emley v. Perrine 368 Emmeluth v. Home Benefit Ass'n 392 Emmens v. Elderton 444 Empire Transp. Co. v. Philadel- phia &c. Co 432 Empress Engineering Co., The.. . 333 Endriss v. Belle Isle Co 136 England v. Davidson ... 67, 135, 149 England v. Marsden 546 English V. Spokane Comm. Co. 226, 457, 458 Epperson v. Nugent 173 Equitable Sur. Co. v. McMillan 353, 357 Erb V. Brown 136 Erie Railway Co. v. Union Loc. and Exp. Co 303 Ernst V. Crosby 295, 305 Erskine v. Adeane 399 Erwin v. Parham 265 Esposito V. Bowden 287 Esteriy Co. v. Pringle 135 Etter V. Greenawalt 337 Eureka Co. v. Edwards 184 Evans v. Hoare 106 Evans v. McCormick 41 Evans Piano Co. v. TuUy 36 Evans, Re 294 Evans v. Supreme Council. . 351, 418 Eveleth v. Sawyer 392 Evelyn v. Chichester 167 Ewell V. Daggs 21 Exall V. Partridge 546 Exchange Bank v. Rice 337, 341, 353 Exchange Nat. Bk. v. Third Nat. Bk 328,521 Exhaust Ventilator Co. v. Chi- cago &c. R 426 Fairbank's Exors. v. Humphreys . 426 Fairbanks v. Metcalf 83 Fairchild v. King 328 Fairchild v. McMahon 247 Fairfield Sav. Bk. v. Chase 536 Fairlie v. Denton 362 FairUe v. Fenton 525 Fairplay School Tp. v. O'Neal 60, 129 Falck V. Williams 32, 61 Fareira v. Cabell 311 Fargo V. Arthur 67 Fargusson ». Winslow 262 Farina v. Fickus 59 Farmers' &c. Co. v. Wilson 542 Farmers' Trust Co. v. Floyd 627 Farrington v. Forrester 177 Farwell Co. v. Wolf 295 Faulkner v. Lowe 8 Favor v. Philbrick 308 Fawcett v. Freshwater 136 Fawcett, In re, v. Holmes 241 Fawcett v. Whitehouse 243 Fay V, Guynon 362 Fay & Co. v. Jenks & Co 391 Fayette Co. Bank v. Steffes 204 Fechteler ». Whittemore 426 Federal Oil Co. t). Western Oil Co. 88 Feeney v. Bardsley 466 Felch t). Taylor 337, 355 "Feldman ti. McGuire 337, 348 Fellowes v. Hartford &c. Co . . . . 539 Fellows V. Wood 178, 184 Felthouse v. Bindley 35 Felton V. Dickinson 353 Ferguson v. Bobo 183 Ferguson «. Coleman 274 Ferguson v. Wilson 188 Ferrier v. Storer 48, 50 Ferris v. Amer. Brewing Co 337 Ferris v. Carson W. Co 346 Fessman o. Seeley 472 Fetherston ». Hutchinson 303 Fetrow v. Wiseman 140 Fidelity &c. Co. v. Lawler 96 Field V, Mayor. .'. 364 Figart v. Halderman 342 Filby V. Hounsell 64 Fillmore u. Great Camp 291 Finch V. Simon 87 Findon v. Parker 294 XXXll TABLE OF CASES PAGE Fink w. Cox 125 Fink V. Smith 130 Finlay v. Chirney 387, 470 Firbanks v. Humphreys 234, 528 Fire Alarm Co. v. Big Rapids. . .426 First M. E. Church v. Donnell . . 142 First Nat. Bk. v. Chalmers. . .98, 338 First N. B. v. Supervisors 327 First Nat. Bk. v. Van Vooris. .79, 545 First N. Bk. v. Yocum 219 Fischer v. Hope Mut. Life Ins. Co 348 Fischer v. Union Trust Co 125 Fish V. Cleland 234, 248 Fishell V. Gray 303 Fisher v. Bishop 267 Fisher v. Bridges 309 Fisher v. Deering 383 Fisher v. Fielding 79 Fisher v. Seltzer 51 Fishmonger's Company v. Rob- ertson 91 Fisk V. Gray 472 Fisk V. Police Jury 12 Fitch V. Chandler 337, 353 Fitch V. Johnson 384 Fitch V. Jones 280, 311 Fitch V. Seymour W. Co 346 Fitcb V. Snedeker 30, 67 Fitch V. Sutton 141 Fitts V. Hall 184, 185, 186 Fitts & Co. V. Reinhart 447 Fitzgerald v. Burke 391 Fitzgerald, Re 320 Flagg V. Baldwin 320 Fleet V. Murton 525, 529, 530 Flesh V. Lindsay 192, 507 Fletcher v. Osborn 296 Flexner v. Dickerson 166 Flickinger v. Saum 337 FUght V. BoUand 181, 474 Flight V. Booth 241 Flight V. Reed 157 Flower v. Sadler 311, 376 Floyd t). Ort .341 Flynn v. Hurlock 497 Foakes v. Beer 90, 137, 139, 140 Fogg V. Portsmouth Athenseum 25, 27, 148 Foley V. Crow .423 Foley V. Piatt 135 Foley V. Speir 303 FoUiard v. Wallace 424, 425 Fonseca v. Cunard Siteamship Company 32 Foote V. De Poy 262 Forbes v. McDonald 288 Forbes v. Thorpe 335, 337, 349, 354, 355 Ford V. Beech 407 Ford V. Cotesworth 287, 433 Ford V. Mitchell 494 .. PAGE Ford V. Newth 52 Ford V. Phillips 178, 180 Ford V. Williams 529, 531 Forman v. Liddesdale 466 Formby v. Barker 385, 386 Forster v. Baker 370 Fortescue v. Crawford 104 Foster v. Charles 220 Foster v. Dawber 26, 139, 480 Foster v. Lookout W. Co 346 Foster v. Mackinnon 203 Foster v. Metts 130 Fowkes ». Manchester Assurance Association 408 Fowler v. Brooks 136 Fowler v. Callan 294 Fowler v. Fowler 404 Fowler v. Waterworks Co 346 Fox V. Boston &c. R 468 Fox V. Kitton ; 442 Poxw. Reil 395 Fox V. Rogers 308 Fradley v. Hyland 532 Fraley's Appeal 368 Francisco v. Smith 366 Frank v. Stratford-Handcock ... 59 Frankfort etc. Ins. Co. v. Cali- fornia etc. Co 202 Franklin Bank v. Severin 481 Franklin Co. v. Harrison 121 Eraser v. Gates 102 Freeman v. Boland 11, 186 Freeman v. Cooke 210 Freeman v. Freeman. . . 125, 237, 474 Freeman v. Morris 340 Freeman v. Nichols 178 Freeman ». Robinson 149 Freeth v. Burr 453 Frenzel>. Miller 229 Freshour's Estate, In re 173 FresTnan v. Knecht 459 Friend v. Lamb 474 Fritz Schultz Co. v. Raimes 162 Frost V. Gage 284 Frost V. Knight 439 Fryp. Ausman 342, 344 Fry, In re 269 Fiye V. HubbeU 137 Fuller V. Bartlett 192 Fuller V, Kemp 139 Fuller!). Smith 139 Furbish v. Goodnow 127, 338 Furnas v. Durgin 351 G Gaar v. Gieen 136 Gabriel », Churchill & Sim 526 Giadd w. Thompson 174 Galusha v. Sherman 262, 547 Gandell v. Pontigny 445 Ganson v. Madfgan 400 Gardiner v. Pullen 89 TABLE OF CASES * PAGE Gardner v. Allen 631 Gardners. Denison.lO, 121, 127,338, 340, 343, 354 Gardner v. Gardner 508 Gardner v. Tatum 272 Gamsey v. Garnsey 479, 480 Garrard v. Frankel 216, 404 Garrett v. Land Co 87 Garrettson v. North Atchison Bank 46 Garrey v. Stadler 165 Garst V. Harris 471 Gates V. Brower 509 Gavagan v. Bryant 203 Gay V. Blanchard.342, 348, 357, 421 Gay V. Seibold 272 Geier v. Shade 290 Geipel v. Smith 485 Geisinger v. Beyl 516 Geismer v. hake Shore &c. Co. . . . 432 Gelpcke v. Dubuque .303 General Accident Corporation v. Noel .- 477 General BiU-Posting Co. v. Atkin- son 442, 444 George v. Andrews 342 GerU V. Poidebard Silk Mfg. Co . . 454 Germam Fruit Co. v. W. U. Tel. Co 205 Gerner v. Mosher 221, 250 Gerrard v. Frankel 216, 404 Gertrude, The 468 Getto V. Friend 12 Gibbons v. Bente 444 -^ Gibbons v. Proctor 30, 68 Gibbs V. Blanchard 388 Gibbs V. Consohdated Gas Co. . .301 Gibbs 0. Guild 500 Gibbs V. Linabury 203 Gibbs V. Wallace 202 Gibney w. Curtis. 455 Gibson v. Carruthers 380 Gibson v. Cranage 425 Gibson v. Holland 104 Gibson v. Lyon 84 Gibson v. Pelkie 209, 217 Gifford V. Corrigan. . . .336, 341, 352 Gilbert v. Sanderson 352 Gilbert v. Sykes 277, 286 Giles V. Canary 391 Gilfeather v. Cohen. 369 Gill V, Johnstown Lumber Co . . . 452 Gillw. M'DoweU 214 Gillespie, Re 368 Gillespie Tool Co. v. Wilson 424 Gillingham v. Brown 156, 499 Gillis V. Goodwin 185 Gilman v. Giiman 79 Gilman v. Lockwood. .... .387, 502 Gilman v. McArdle 6, 326 Gist V. Telegraph Co 318 Glaholm v. Hays 456 PAGE Gleason v. Hamilton 490 Glenn v. Farmers' Bank 311 Globe Refining Co. v. Oil Co. . . .468 Godard v. Gray 650 Goddard v. Binney 114 Goddard v. Monitor Ins. Co. . . .239 Goddard v. O'Brien 139, 497 Goddard's Case 83 Godsall V. Boldero 283 Goebel v. Linn 136 Goldberg v. Feiga 317 Goldsborough v. Gable 135 Goldsmith v. Manufacturers' L. Ins. Co 272 Goldsmith v. Sachs 392 Goldstein v. D'Arcy 202 Golsen v. Brand 546 Goman v. Salisbury 488 Gompers v. Rochester 87 Gooch V. Faucett 320 Good V. Cheesman 141 Goode V. Harrison 168 Goodenow v. Curtis 17 Goodenow v. Tyler 623 Goodisson v. Nunn 413 Goodman v. Alexander 173 Goodman v. Chase 98 Goodnow V. Empire Lumber Co. . 180 Goodrich v. Van Nortwick 426 Goodsell V. Western Union Tel. Co 334 Goodwin v. Robarts 377 Gordon v. Butler 247 Gordon v. George 382 Gordon v. Gordon 146 Gordon v. Manchester &c. Ry . . . 70 Gordon v. Street 206 Gordon Malting Co. v. Bartels Brewing Co 40 Gorham's Adm'r v. Meachem's Adm'r.. 3,8,24,83 Gorrell v. Greensboro Water Co. 339, 345, 346 Goss V. Lord Nugent 488 Gottfried v. Miller 90 Gottschalk v. Stein 473 Gould w. Segee 205 Gould V. Stein 226 Colliding V. Davidson 157 Gowen v. Pierson 292 Grace v. Lynch 102 Gradle v. Warner 103 Grady v. Ins. Co 291, 521 Graf V. Cunningham 454 Grafton v. Cummings 103 Graham v. German Amer. Ins. Co 291 Graham v. Hiesel 289 Graham v. Johnson 369 Graham v. Meyer 245 Grainger v. Gough 70 Grandin v. Grandin 132 XXXIV TABLE OF CASES Granger Co. v. Brown-Ketcham Iron Works 412 Granger v. French 289 Grant v. Beard 525 Grant v. Easton 80 Grant v. Porter 157 Grant Marble Co. v. Abbot 211 Graves v. The Calvin S. Edwards.485 Graves v. Johnson 288, 295, 305 Graves v. Legg 460 Gray v. Barton 140, 479 Gray v. Gardner .274, 412 Gray v. Hamil 126 Gray v. Hinton 54 Gray v. Hook 288 Gray v. Mathias 295 Gray v. Moore 223 Gray v. National Benefit Assoc. .240 Gray v. Pearson 333 Gray v. Roberts 313 Greater Pittsburgh &c. Co. v. Riley 285 Great N. R. Co. v. Witham 49, 51, 52, 425 Greaves, In re 499 Greaves v. Ashhn 105 Green v. Batson 399 Green v. Green 180, 184 Green v. Ovington 81 Green v. Reynolds 413 Green v. Roworth 266 Green v. Thompson [1899] 2 Q. B. 1 174 Green v. Turner 349, 352 Green v. Wilkie 203 Greenburg v. Palmieri 532 Green Co. v. Blodgett 90 Greene v. Bateman 200 Greenfield Bank v. Crafts 514 Greenwood v. Law 112 Greer v. Hale 310 Greer v. Severson 288, 311 Gregory v. Lee 171 Gregory v. Schoenel 229 Gregory v. Willianis 335 Grell V. Levy 319 Gribben v. Maxwell 191 Grice v. Noble 36 Griffin v. Cunningham 98 Griffith y. Tower Publishing Co. 365 Griffiths V. Sears 310 Griggs V. Moors 451 Grigsby v. Stapleton 211, 245 Grime v. Borden 335, 355 Griswold v. Gebbie 250 Griswold V. Waddington . . . 162, 163 Grocers Bank v. Penfield 378 Gross V. Drager 203 Grossman v. Lewis 230 Grove v. Webb 410 Grover v. Matthews 514 Grand v. Van Vleck 512 PAGE Grymes v. Sanders 258, 259 Guaranty Trust Co. v. North German Lloyd 429, 431 Guelich v. National State Bank... 328 Guerin v. Stacy 471 Guernsey v. Cook 285, 288 Guernsey v. Wood 387, 502 Guild V. Conrad 95 Guinzburg v. Downs Co 69 Gulla V. Varton 357 Gunby v. Sluter 229 Gunster v. Scranton &c. Co 536 Gurney v. Behrend 381 Gustin V. Union School Dist. . . .366 Guthing V. Lynn 60 Gutta Percha Co. v. Mayor 79 Gylbert v. Fletcher 174 H Haas V. Myers 43, 45 Hackett v. Martin 362 Haden v. Ware 210 Hadley v. Baxendale 468 Hadlock v. Brooks 294 Haggart v. Morgan 291 Hahn v. Concordia Society 477 Haigh V. Brooks 121, 407 Haight V. Hayt 295 Haines v. Starkey 53G Hale V. Bonner 470 Hale V. Dressen 87, 480 Hale V. Gerrish 180 Hale V. Spaulding 390, 496 Hale V. Trout 441 Hale V. Wilson 501 HaU«. Bliss 540 Hall V. Butterfield 184 Hall V. Ewin 385 Hall V. Kimmer 310 Hall V. Lanning 79 Hall V. Marston 337 HaU V. Otterson 264 HaU V. Paine 519 Hall V. Perkins 88, 121, 267 Hall ». Phelps. 395 Hall V. Stevens 494 Hall V. Warren 191 HaU V. Wright 431 Hall Mfg. Co. V. Western Steel Works 300 Halliday v. Hess 407 Hambel v. Tower 494 Hamer v. Sidway 10, 12, 116, 120, 326. Hamill Co. v. Woods 407 Hamilton «. Home Ins. Co . .291, 449 Hamilton v. Liverpool &c. Ins. Co 291 Hamilton v. Vaughan-Sherrin Electrical Engineering Co . 166, 170 Hamlin v. Sears 512 Hamlin v. Stevenson J. 65 TABLE OF CASES PAQH Hammersley v. de Biel 28, 144 Hammond v. Hopping 157 Hammond v. Messenger 364 Hammond v. Pennock 230 Hampden v. Walsh 317 Hampton v. M'Connel 80 Hanan v. Ehrlich 101 Hanauer v. Doane 305 Hancocks v. Lablache 194 Handy v. Bliss 424 Handy v. St. Paul Globe Publish- ing Co 272,303 Hankins v. Ottinger 273 Hanks v. Barron 146 Hanks v. Deal 187 Hanley v. Donoghue 79 Hanlejr v. Sweeny 244 Hannigan v. Allen 341 Hancrver Bank v. Blake 284 Hansard v. Robinson 491 Hansen v. Meyer 382 Hanson v. Marsh 115 Hanson v. Wittenberg 36, 452 Hapgood V. Shaw 451 Harburg India Rubber Comb Co. V. Martin 96, 98, 525 Hardell v. McClure 114 Hardie Sons & Co. v. Scheen 314 Hardirfg v. Hagar 271 Hardman v. Booth 207 Hardy v. Waters 177 Hardy &c. Co. v. South Bend Co. 361 Ha,re v. Murphy 342 Harlan v. Harlan 97 Harland v. LiUenthal 272 Harlow v. Beaver Falls 464 Harmony v. Bingham 431 Harms v. McCormick 347 Harner v. Fisher .532 Harper v. Harper 101 Harper v. Vigers 530 Harralson v. Stein 521 Harran v. Foley 213 Harriman v. Northern Securities Co ...307,313 Harrington v. Connor. ..." 188 Harrington v. Grant 314 Harrington v. Victoria Graving Dock Co 516 Harris' Case 44 Harris, The Marion S 89 Harris v. Brisco 294 Harris v. Cannon 182 Harris v. More 67 Harris v. Musgrove 181 Harris v. Nickersoli 69 Harris v. Pepperell 216 Harris v. Rickett .396 Harris v. Runnels 272 Harris v. Tyson 246 Harris v. White 66, 273 Harrison v. McCormick 389 Harrison v. Moran 327 Harrison v. Otley 191 Harrison v. Polar Star Lodge. . . . 481 Harse v. Pearl Life Assurance Co .313 Hart V. Alexander 483 Hart V. British Ins. Co 238 Hart V. Georgia R 129 Hart V. Miles 133 Hart V. Mills 27, 148 Hart V. Seymour 80 Hart V. State 294 Hartford F. I. Co. v. Davenport . . 355 Hartford Prot. Ins. Co. v. Har- mer 239 Hartford Sorghum Co. v. Brush . . 426 Hartley v. Ponsonby 137 Hartley v. Rice 296 Hart-Parr Co. v. Finley 442, 446 Hartung v. Witte 382 Harvey v. Briggs 181, 184 Harvey v. Facey 62V Harvey v. Gibbons 129 Harvey v. Johnston 40 Harvey v. Merrill 277, 281, 306 Harvey v. Young '. 247 Harvey Co. v. Drug Co 477 Haskell v. Starbird 533 Hastelow v. Jackson 318 Hastings v. Dollarhide.177, 180, 181 Hastings v. Love joy 487 Hatch V. Hatch 156, 179 Hatch V. Purcell 150 Hatch V. Taylor 622 Hathaway v. Lynn 424 Hathaway v. Stone 292 Haubelt v. Rea etc. Co 205 Haue]jstein f . Lynham 162 Hauser v. Harding 61 Havana &c. Co. v. Ashurst 146 Haviland v. Willets. . . .211, 213, 217 Hawken v. Bourne 509 Hawkins v. Graham 426, 426 Hawkins v. Pemberton 458 Hawksland v. Gatchel 84 Hay V. Fortier 39, 125, 130 Haydock v. Haydock 264 Haydon v. Williams 491 Hayes v. Allen 496 Hayes v. O'Brien 50, 54 Hayes v. Warren 544 Haynes v. Church 435 Haynes v. Rudd 289, 312 Hayward v. Barker 157 Hayward v. HajTsrard 192 Hayward v. Langmaid 512 Hayward v. Leonard 424 Haywood v. Brunswick Building Society 385 Hazard v. New England Marine Ins. Co 400 Head v. Clark 51 Head v. Tattersall 484 XXXVl TABLE OF CASES PAGE Hearn v. Ins. Co 402 Heath v. Stoddard 510 Heather v. Webb 156, 503 Heaton v. Angier 362 Hebb'sCase 45 Hecht V. Batoheller 209, 210 Heckemann v. Young 390 Hedderly v. Downs 391 Hedin v. Minneapolis &c. Inst . . . 248 Heersman v. Ellsworth 367 Heffron v. Brown 27 Heffron v. Pollard 525, 626 Hefner v. Vandolah 514 Hegenmyer v. Marks 244, 517 Heilbut V. Buckleton 223, 225 Heinemann v. Heard 516 Heirn v. McCkughan 70 Helby v. Matthews 524 Helfenstein's Estate 47, 143 Henderson v. Arthur 398 Henderson v. Stevenson 33 Henderson Bridge Co. v. Mc- Grath 60 Hendrick v. Lindsay 126 Henkel v. Pape 205 Hennequin v. Naylor 258 Hennessy v. Metzger 471 Henry f. Heeb 514 Henry v. Root 156, 180, 181 Hensohke v. Moore 300 Henshaw v. Robins 458 Henthom v. Eraser 43, 44, 55 Hentz V. Miller 207 Herman v. Conn. Mut. L. I. Co. . 368 Hermann v. Charlesworth. . 296, 316 Hermann v. Jeuchner 290 Heme Bay S. S. Co. v. Hutton ... 430 Herreshoff v. Boutineau 300 Herring v. Dorell 130 Herrington v. Davitt 156 Hertzog v. Hertzog 12, 27, 543 Herzog v. Sawyer 487 Hess V. Dawson 454 Hess V. Rau 539 Heuertematte v. Morris 378 Hewitt V. Anderson 30 Heyn v. Philips 100 Hichens v. Congreve 243 Hickey v. Morrell 250 Hickey v. O'Brien 52 Hickey v. Ry 384 Hickman v. Haynes 482 Hicks V. Burhans 150 Higdon V. Thomas 84 Higgen's Case 489 Higgins V. Cal. &c. Co 402, 407 Higgins V. Kusterer Ill Higgins V. Lessig 60 Higgins V. Senior 525, 531 Hill V. Anderson 183 Hill V. Grigsby 450 Hill V. Hoeldtke 352 Hillf. Hooper 101 HiU V. More 291 Hill t). Spear 305,320 Hill !). Wilson 4 Hills V. Evans 402 Hills V. Sughrue 430 Hillyer v. Bennett 184 Hilton V. Guyot 79 Hilton V. Shepherd 181 Hindle v. Brown 231, 233 Hinely v. Margaritz 180 Hirschfield v. London, Brighton and South Coast Railway Co . 248 Hirth V. Graham 100, 111 Hitchcock V. Coker 299 Hitchman Coal & C. Co. v. Mitchell 330 Hittson V. Browne 272 Hoadley v. McLaine 115, 148 Hoare v. Rennie 453, 454 Hobbs V. Columbia Falls Brick Co 479 Hobbs V. Electric Lt. Co 87 Hobbs V. Hinton 181 Hobbs V. Massasoit Whip Co . . 27, 36 Hobbs V. Straine 159 Hobson V. Trevor 89 Hochmark v. Richler 391 Hochster v. Delatour 439, 442 Hocking v. Hamilton 442 Hodge V. Sloan 385 Hodges ti. Nalty 142 Hoffman v. Bank 119, 378 Hoffman v. Dixon 221 Hoffman v. Vallejo 294 Hogan V. Stophlet 135 Hogg V. Longstreth 546 Hoghton V. Hoghton 264, 266 Hoidale v. Wood 137 Holbrook v. Connor 247 Holbrook v. Henderson 164 Holcomb V. Noble 219, 250 Holden v. Banes 126 Holden v. Upton 310 Holland v- Bennett 440, 444 Hollins V. Fowler 207 HoUoway v. Rudy 157 Holman v. Johnson 287 Holmes v. Bell 489 Holmes v. Blogg 184 Holmes v. Cathcart 2^, 516 Holt W.Green 271 Holt V. Ward 122, 181 Holtby V. Hodgson 196 Homans v. Tyng 87 Home Ins. Co. v. Union Trust Co 411 Home Ins. Co. v. Watson 29 Home Pattern Co. v. Mertz 446 Homer v. Shaw 369 Homer v. Thwing 186 Honck V. Muller 453 TABLE OF CASES xxxvn PAQE Hone V. Presque-Isle W. Co . . . 346 Honeyman v. Marryatt 64 Hood-Barra v. Heriot 196 Hope y. Hope 319 Hopkins v. Logan 545 Hopkins v. Racine Iron Co ... . 49 Hopkins v. Warner . . .343, 348, 349 Horan v. Hughes 625, 530 Horlock V. Beal 429, 431 Hornet). Midland Railway Com- pany 468 Home V. Niver 49 Horner v. Graves 299 Horsfall v. Thomas 255 Hoshor V. Kautz 121 Hosier v. Beard 191, 192 Hosier v. Hursh 496 Hosmer v. Wilson 444 Hotchkin v. Bank 229, 244, 248 Hough V. Barton 362 Houldsworth v. City of Glasgow Bank 257 House V. Alexander 173 House V. Houston W. Co 346 Household Fire Ins. Co. v. Grant 42, 44, 46 Houseman v. Girard &c. Ass'n. . 536 Houser v. Hobart 122 Hovey v. Page 386 Howard v. Daly 45 Howard v. Duncan 514 Howard v. Manufacturing Co . . 469 Howard v. Simpkins 173 Howard v. Turner 258 Howarth v. Warmser 386 Howatson v. Webb 202 Howe V. Keeler 508 Howe Machine Co. v. Farrington 243 HoweU V. Kelly .100 Howes V. Bishop !267 Howland v. Lounds 30 Howlett V. Hewlett 61 Howsman v. Trenton W. Co . . . 346 Hoyle, In re 99 Hoyle V. Hoyle 8 Hoyt V. Hoyt 265 Hoyt V. Pomeroy 421 Hoyt V. Wilkinson 546 Hubbard v. Tenbrook.206, 529, 531 Hubbell V. Von Schoening 462 Huoklesby v. Hook 106 Huffman v. Long 530 Hughes V. Oregon Ry. & Nav. Co.347 Hughes V. Wamsutta Mills. ... 433 Hughes V. Washington 519 Huguenin v. Baseley 267 Huguenin v. Courtenay 434 Hulbert v. Clark 499 Hulett V. Carey 5 HuUe V. Heightman 465 Hulse V. Young 523 Hulthen v. Stewart 432 PAGE Humble v. Hunter. . . 360, 529, 532 Humes v. Land Co 144 Humfrey v. Dale 403 Hummel v. Stern 426 Humphrys v. Polak 297 Hungerford v. Hungerford. 193, 296 Hunnewell v. Duxbury 255 Hunt V. Bate 151 Hunt V. Hunt 99, 110 Hunt V. Livermore 425 Hunt V. Rousmanier 539 Hunter v. French etc. Co 230 Hunter v. Walters 202 Huntington v. Knox 206, 531 Huntley v. Mathias 510 ^ Huntress v. Blodgett 219 Hurford v. Pile 54 Hurst V. Knight 353 Hurt t). Ford 96 Huscombe v. Standing 262 Huset V. Case Threshing Machine Co 254 Hussey v. Home Payne 65 Husted V. Thomson 326 Hutcheson v. Eaton 530 Hutcheson v. Grubbs 80 Huthmacher v. Harris 209 Hutton V. Warren 401 Huyler v. Atwood 342 Hyams v. Stuart King 306 Hyatt V. Clark 514 Hyde v. Wrench 62 Hyer v. Hyatt 178 Hyland v. Crofut 338, 351 Hynes v. Wright 292 I Ide V. Stanton 115 Ihley V. Padgett 180 Ilsley V. Jewett 156 Imp. Bank of Canada v. Bank of Hamilton 217 Imperial Loan Co. v. Stone .... 190 Independent Sch. Dist. v. Le Mars W. Co.... 339 Indiana &c. Ry. v. Adamson. . .391 Indianapolis Chair Mfg. Co. v. Wilcox 166 Inhabitants of Middlefield v. Church Mills Knitting Co. . .384 Insurance Co. v. Brehm 248 Insurance Co. v. Hull 289, 314 Insurance Co. v. Hunt 191 Insurance Co. v. Leslie 239 Insurance Co. v. Ruggles 238 International Text Book Co. v. Martin 446, 449 lonides v. Pacific Insurance Co . 208 lonides v. Pender 238, 239 Ireland v. Livingston 518, 625 Irvin V. Iryin 296 Irvine v. Grady 635 XXXVIU TABLE OF CASES PAGE Irvine v. Irvine 180, 182 Irvine v. Watson 533 Irving V. Veitch 545 Irwin V. Curie 272, 294 Irwin V. Dyke 474 Irwin V. Lee 460 Irwin V. Lombard Univ 142 Irwin V. WUliar 276, 281, 306 Irwin V. Wilson 208, 209 Isaacs V. Skrainka 230 Ish V. Crane 542 Isham V. Post 134 Ison V. Cornett 181, 185 Ison W.Wright 291 J J., Re 192 Jackson v. Alexander 73, 84 Jackson v. Bank 305 Jackson v. Colegrave 276 Jackson v. Longwell 499 Jackson v. Mayo 179 Jackson v. Normanby Brick Co. 475 Jackson y.Union Marine Insur- ance Co 453 Jacksonville R. v. Hooper. . .82, 90 Jacob Johnson Fish Co. v. Hawley 63 Jacobs V. Burgwyn 98 Jacoby v. Stark 470 Jaffray v. Davis. 119, 138, 140, 481 Jaggar v. Winslow 248 Jakeman v. Cook 156 James v. Burchell 447 James v. Kerr 266 James v. Newton 364 James v. O'DriscoIl 31 James v. Patten 106 Jamiesonw. Indiana Natural Gas Co 433 Janson v. Driefontein Consoli- dated Gold Mines, Ltd.. 286, 287 Janvrin v. Exeter 67 Jaques v. Methodist Church. . .194 Jay V. Robinson 196 Jefferson v. Asch 339, 343, 357 Jeffrey v. Bigelow 533 Jeffries v. Ferguson 390 Jemison v. Bank 190 Jenkins v. Betham 616 Jenkins v. Chesapeake & O. R. Co 338 Jenkins v. Pye 269 Jenkins v. Sugar Co 52 Jenness v. Simpson 352 Jenree v. Metrop. St. R. Co. . . 341 Jervis v. Berridge 399 Jessel V. Williamsburgh Ins. Co . 363 Jewel V. Neidy 294 Jewett V. Cunard 392 Jewett Pub. Co. v. Butler 284 Jilson V. Gilbert 160 Joel V. Law Union 240 FAOfI Joest V. Williams.- 191 Johns V. Johns 110 Johnson v. Albany &c. R 499 Johnson v. Armstrong 529 Johnson v. Bankers &c. Co. . . .420 Johnson v. Brooks 473 Johnson v. Buck 523 Johnson v. Cooke 138 Johnson v. Dodge 106 Johnson o. Federal U. Sur. Co. 62 Johnson v. Fehsefeld 466 Johnson v. Gallagher 194 Johnson v. Gerald 83 Johnson v. Gulick 219, 250 Johnson v. Harvey 390 Johnson v. Hurley 510 Johnson v. Ins. Co .178, 184 Johnson v. Kearley 520 Johnson v. Kimball 150 Johnson v. Lines 173 Johnson v. McClung 341 Johnson v. Royal Mail Steam Packet Co 646 " Johnson v. Sellers 144, 146 Johnson v. Terry 297 Johnson v. Thompson 84 Johnson v. Walker 435 Johnston v. Armstrong 525 Johnston v. Bent 229 Johnston v. Boyes 69 Johnston v. Gerry 181 Johnston v. Milwaukee &c. Co. 510 Johnstone v. Milling 440, 444 John T. Hardie Sons & Co. v. Scheen 314 Jones, Ex parte 169 Jones, In re 86 Jones V. Ashburnham 130 Jones V. Bacon 96 Jones V. Daniel 62 Jones V. George 458 Jones V. Horner 189 Jones V. Just 467, 461 Jones V. McEwan 227 Jones V. Phoenix Bank 180 Jones V. Reynolds 112 Jones V. Shaw 84 Jones V. Stanly 329 Jones V. Valentines' School. . . . 171 Jones & H. Co. v. Davenport. . 424 Jordan v. Coffield 173 Jordan v. Davis 83 Jordan v. Osgood 248 Jordan v. Walker 65 Jordan, Marsh & Co. v. Beals . . 208 Joslinw.NewJerseyCarSpringCo.340 Joy V. St. Louis 474 Judson V. Corcoran 368 Judson V. Sierra 540 Judy V. Louderman 121 Jughardt v. Reynolds 136 Justice V. Lang. 13, 106 TABLE OF CASES f FAGB Kadish v. Young 440 KalkhofF v. Nelson 442 Kane v. Hood 450 Kansas Nat. Bank v. Bay 526 Kantrowitz v. Prather ■. . 194 Kantzler v. Bensinger 285 Kaufman v. Gerson 262, 319 Kaye v. Button 151 Kayton v. Barnett 529 Kearley v. Thomson 315 Keates v. Lord Cadogan 246 Keefer. Shell 533 Keegan v. Cox 180 Keeler v. Clifford 426, 454 Keene v. Demelman 231 Keighley, Maxsted & Co. v. Durant 512 Keightley v. Watson 392 Keir v. Leeman 289 Kekewich v. Manning 264, 474 Keller v. Ashford . . . .343, 344, 349 Keller v. Holderman 4, 60 Keller v. Ybarru 52 KeUett V. Robie 479 Kelley v. Riley 308 Kellogg Bridge Co. v. Hamilton . 457 Kelly, Matter of 50 Kelly w. Bliss 480 Kelly V. Bowerman 539 Kelly V. Cent. Pac. Ry 257 Kelly V. Chicago 68 Kelly V. Security Co 351 Kelly «. Solari 217 Kelly Const. Co. v. Hackensack Brick Co 452 Kelner v. Baxter 513, 527 Kelsey v. Hibbs 96 Kemble v. Farren 471, 472 Kemp V. Baerselman 361 Kemp V. Finden 546 Kemp V. Pryor 511 Kendall v. Brownson 415 Kendall v. Hamilton 890, 532 Kendall W.May 192 Kennedy v. Broun 151, 165 Kennedy v. Gramling 63 Kennedy v. McKay 533 Kennedy v. McKone 61 Kennedy v. Panama, New Zea- land and Royal Mail Co. 232, 233 Kennedy v. Panama Steam Co . . 222 Kenner v. Harding 245 Kennett v. Chambers 287 Kent W.Kent 101 Kent V. Rand 157 Kentucky v. Bassford 320 Kenyon v. Saunders 164 Keppel V. Baily 384 Kernw. Myll 247 Kernohan v. Durham 369 Kerr v. Bell 184 PAGE Kerr v. Finch 106 Kershaw v. Kelsey 162, 287 Kessler's Estate. 110 Keuka College v. Ray 142 Kibble, Ex parte 175 Kidder v. Kidder 140, 481, 496 Kiernan v. Dutchess &c. Co. . .420 Kilgore v. Bulkley 402 Killmore v. Hewlett 100 Kilmer v. Smith 216 Kimball, The 494 King V. Bardeau 241, 423 King V. Duluth &c. Ry. . .136, 137 King V. Eagle Mills 219, 229 King V. Gillett 480 King V. Hoare 390 King V. King 296 King V. Knapp 241 King V. MoUohan 193 King V. Scott. . . .339, 342, 344, 347 King V. Victoria Insurance Co. . 364 King V. Waterman 442 King V. Whitely 339 King Philip Mills v. Slater 454 Kingsley v. Davis 532 Kingsway C. Co. v. Metrop. L. I. Co 63 Kinsman v. Parkhurst 121 Kinyon v. Wohlford 205 Kirkham v. Attenborough 39 Kirkham v. Marter 98 Kirkland v. Dinsmore 33 Kirkpatrick v. Reeves 250 Kirkpatrick v. Stainer 526 Kirkpatrick v. Tattersall 156 Kiser v. Holladay 27 Kittredge v. Holt 498 Knapp V. S. Jarvis Adams Co. .300 Knight V. Abbott 495 Knight V. Cooley 62 Knights of Maccabees v. Sharp . 339 Knowles v. Gaslight Co 79 Knowlton v. Congress Spring Co. 308, 315 Koehler v. Buhl 425 Kofka V. Rosicky 110 Kokomo Strawboard Co. v. In- man , 454 Korman v. Trainer 419, 438 Kountze v. Kenned:^ 220, 250 Kowalke v. Milwaukee &c. Co. 209, 210 Krause v. Busacker 250 Kregor v. Hollins 285 Krell V. Codman 86 Krell V. Henry 429 Kroeger v. Pitcairn 235, 527 Kromer v. Heim 140, 496 Kuelling v. Lean Mfg. Co 254 Kullman v. Greenebaum 284 Kurtz V. Frank 295, 439, 442 Kyle V. Kavanagh 208 xl TABLE OF CASES PAQB Kyte V. Commonwealth Union Ins. Co 486 L Lacy V. Getman 386, 435 Laponda N. B. v. Portner 312 Laidlaw v. Organ 213, 245 Laing v. Butler 532 Lakeman v. Pollard 431, 435 Lake Shore &o. Ry. v. Richards . 441 Lamare v. Dixon 230 Lamkin v. Ledoux 184 Lampleigh v. Braithwait. . . 149, 150 Lamson v. Bane 281 Lancaster v. Elliott 36 Lancaster v. Roberts 241 Lancaster v. Walsh 67 Lancey v. Clark 492 Landis v. Royer 150 Landwerlen v. Wheeler 389 Lane v. Dayton C. & I. Co . 178, 184 Lane v. Smith 369 Langan v. Amer. Leg. of Honor . 351 Langridge v. Levy 254 Langrish v. Watts 501 Lansing v. Dodd 472 Lansing v. Mich. Cent. R.R. Co.l82 Lantry v. Wallace 258 Lapish V. Wells 245 Larkin v. Hardenbrook 491 Larned v. Andrews 271 La Rue v. Groezinger 361 Lassing v. James 401 Lattimore v. Harsen 136 La Valle v. Droit 337 Laver v. Fielder 59 La very v. Pursell 100, 109 Law V. London Indisputable Life Policy Co 283 Lawf ord v. Billericay Rural Coun- cil 91 Lawrence v. Cook 99 Lawrence v. Davey 136 Lawrence v. Fox 336, 338, 340, 353, 356 Lawrence v. Harrington 156 Lawrence v. Oglesby 127 Lawrence v. Ry 474 Lawrence v. Staigg 216, 404 Lawrence v. Twentiman 431 Leak v. Driffield 195 Leal V. Terbush 210 Leask v. Horton 89 Leather Mfrs. Bk. v. Morgan. . . 546 Leavey v. Drake 125 Leavitt u. Kennicott 402 Lebanon &c. Co. v. Erb 420 Le Blanche v. L. & N. W. Rail- way Co 70, 460 Lee V. Bangs 227 Lee V. Butler 104 Lee D. Griffin. 114 PAOB Lee V. Jones 243 Lee V. Muggeridge 157, 168 Leeds Bank v. Walker 491 Lees V. Whitcomb 40 Legh w. Legh 362 Lehigh Z. & I. Co. v. Bamford.219 Lehman v. Detroit R. Co 294 Lehow V. Simonton 341 Leinkauf v. Caiman 90 Leiston Gas Co. v. Leiston &c. Council 428 Le Lievre v. Gould 236 Lemprifere v. Lange 187 Leng V. Andrews 174 Lennard v. Robinson 526 Lennox v. Murphy 41 Leonard v. Dyer 410, 452 Lerned v. Wannemacher. . 104, 396 Leroux v. Brown 107 Leskie v. Haseltine 68 Leslie v. Fitzpatrick 174 Leslie v. Sheill 186 Levene v. Brougham 169, 183 Lever v. Koffler 65 Levet V. Hawes 351 Levine v. Ins. Co 291 Lewis ti. Atlas Mut. Life Ins. Co. 39 Lewis V. Brehme 525 Lewis V. Browning 45 Lewis V. Clay 204 Lewis V. Eagle Ins. Co 238 Lewis V. GoUner 385 Lewis t). Holmes 470 Lewis V. Jewell 256 Lewis V. Kerr 542 Lewis V. Nicholson 526 Lewis V. Tapman 99 Lewis V. Terry 259 Lewis V. Tilton 527 L. G. O. Co. V. HoUoway 243 Liberty Wall Paper Co. v. Stoner &c. Co 361 Lickbarrow v. Mason 380 Lima Loco. & M. Co. v. Nat'l Steel Castings Co 52, 123 Lindeke Land Co. v. Levy 531 Linderman v. Farquharson. . . .195 Lindquist v. Dickson 532 Lindsay v. Smith 303 Lindsay Petroleum Co. v. Hurd.247 Lingenf elder v. Wain wright Brew- ing Co 135 Linneman v. Moross 339 Linville v. Greer 181 Linz V. Sohuok 136 Lister v. Lancashire and York- shire Railway Co 485 Lister & Co. v. Stubbs 517 Listman v. Diifresne 442 Litchfield v. Dreyfus 265 Litchfield v. Flint 338 Little V. Banks 357 TABLE OF CASES 3di Little V. Gallus 477 Little V. Mercer 445 Littlefield v. Shee 158 Littlefield v. Storey 362 Liverpool L. & G. Co. v. Kearney.408 Liversidge v. Broadbent 363 Livingston v. Ralli 291 Llanelly Railway Co. v. L. & N. W. Railway Co 498 Llewellyn v. Butler 342 Lloyd V. Fleming 365 Lloyd V. Fulton 99 Lloyd V. Grace 533, 534, 535 Lloyd V. HoUenback 110 Lloyds V. Harper 335 Lockwood V. Smith 345 Lockwood Mfg. Co. V. Mason Regulator Co 426 Lodge V. National etc. Co 313 Logan Co. Bk. v. Townsend. . . 314 Lombard v. Chicago Congrega- tion 423 London and Northern Bank, In re 46 London &c. Co. v. Horn 330 London and N. E. Co. v. Schlesin- ger 428 London Assurance v. Mansel 239, 240 London Freehold Co. v. Lord Suffield 83 London General Omnibus Co. v. Lavell 256 London Joint Stock Bank v. Sim- mons 376 Lonergan v. Buford 262 Lonergan v. Waldo 468 Long V. Hartwell 488 Long V. Millar 104, 396 Long V. Thayer 542 Long V. Warren 256 Long V. White 100 Long V. Woodman 248 Longr|dge v. Dorville 132 Longworth v. Mitchell 49 Loper V. Robinson 219, 229 Lorah v. Nissley 82 Loring v. Boston 50 Lorrillard v. Clyde 356 Los Angeles Traction Co. v. Wild- hire 54 Loud V. Pomona &c. Co. . . 449, 451 Loudenback Fertilizer Co. v. Tennessee Phosphate Co ... . 52 Louisiana v. Mayor 78 Louisville & N. R. Co. v. Coyle . 54 Louisville & N. R. Co. v. Good- night 54, 420 Louisville &c. Co. v. Lorick .... 103 Louisville & N. R.R. Co. v. Mott- ley 433 Louisville &c. R. w. R. Co 402 Love V. Harvey 276 Lovejoy v. Bessemer W. Co 346 Lovelock V. Franklyn 447 Lovering v. Buck Mt. Coal Co . .435 Lovett V. Lovett 177 Low V. Bouverie 236 Low V. Conn. &c. R 613 Lowber v. Bangs 456 Lowe V. Doremus 296 Lowe V. Peers 296 Lowery v. Gate 186 Loyd V. Lee 130 Lucan, In re 474 Lucas V. Dixon 102 Luetchford v. Lord 310 Lufkin Rule Co. v. Fringeli 298 Luhrs V. Hancock 191 Lumley v. Gye 329, 421 Lumley v. Wagner 17, 475 Lumsden's Case 168 Lydig V. Braman 103 Lyman v. Gedney 392 Lyman v. Lyman 5 Lynch v. Mercantile Co 533 Lynch v. Rosenthal 273 Lynch v. Wright 468 Lynn v. Bruce 140, 497 Lynn v. Selby 466 Lyon V. Ballentine 392 Lyon V. Kent 507 Lyon V. Mitchell 288 M McAninch v. Laughlin 210 McAnnulty v. McAnnulty 102 McArthur v. Times Printing Co . 513 Macartney v. Garbutt 164 McCandless v. Alleghany &c. Co. 67, 135 McCargo v. Jergens 421, 444 McCarren v. McNulty 426 McCarter v. Firemen s Ins. Co. 300, 301 McCarty v. Carter 180 McCarty v. Hampton Building Ass'n 135 McCarty v. Woodstock Iron Co. 182, 185 McCauley v. Davidson 134 McClintock v. South Penn Oil Co 43 McClure v. Briggs 426 McClure v. Jefferson 468 McClure v. McClure 166 McClure v. Trust Co 241 McClurg V. Terry 4, 60 McConnell v. Harrell 64 McCormick v. Basal 442 McCormick v. Joseph 536 McCormick v. Littler 192 McCoy w. Metropolitan Ins. Co. 240 MoCready v. Phillips 248 xlii TABLE OF CASES McCready v. Thorn 511 McCreery v. Day. . . .481, 487, 497 M'CulIoch V. Ins. Co 43 McCuUough V. Virginia 303 McCurdy v. Rogers 627 McCurry v. Gibson 299 McDevitt V. Stokes 146 McDonald v. Bank 43 McDonald v. Crosby 107 McDonald v. Finseth 342 Macdonald v. Longbottom 400 McDuffee v. Irrigation Co 313 MacFarlane v. Bloch 40 McGomgle v. Klein 466 McGoren v. Avery 547 McGowin v. Menken 414 McGreal v. Taylor 185 McGregor v. McGregor. . .101, 193 McGregory v. McGregory 491 Mcintosh V. Aubrey 289 Mclntyre v. Buell 219, 229 Mclntyre v. Parks 320 Mclver v. Richardson 28, 41 McJilton V. Love 498 Mack V. Latta 256 McKanna v. Latta 256 McKanna v. Merry 173 Mackay v. Saint Mary's Church . 189 McKay v. Ward 342 McKeany v. Black 95 McKeever v. Cannonsburg Iron Co 52 McKenna v. Vernon 420 McKenzie v. British Linen Co. . 514 Mackenzie v. Coulson 404 McKenzie v. Donnell 191 McKenzie v. Harrison. . . .479, 487 McKenzie v. Lynch 289 MacKeown v. Lacey 367 Mackin v. Dwyer 132 McKinnell v. Robinson 305 McKinney v. Alvis 363 McKinzie v. Stretch 60 McKown V. Furgason 220, 250 Maclay v. Harvey 49, 60 McMahon v. Second Ave. R. Co. 341 McManus v. Bark 496 McManus v. Cooke 109 McManus v. Fortescue 69 McMillan v. Ames 53, 64, 86 McMurphy v. Garland 487 McNair v. Parr 284 McNamara v. People 81 McNish V. Reynolds &c. Co. . . 481 McPherson v. Cox 262 MacPherson v. Mackay 421 McPherson v. Watt 619 McRaven v. Crisler 449, 490 Mactier v. Frith 24, 39, 43 Madan v. Sherard 33 Maddick v. Marshall 622 Maddison v. Alderson 109, 110 Magee v. Manhattan Co 243 Magee v. Scott &c. Co 425 Mahaney v. Carr 110 Main v. Oien 424 Main Street Co. v. Los Angeles Co 135 Maine, State of, v. Chandler ... 81 Maisch v. Maisch 296 Majestic, The 32 Maleverer v. Redshaw 302 Malins v. Freeman 21 Mallalieu v. Hodgson 284 Mallan v. May 87, 406 Mallory v. Gillett 95, 98 Mallory v. Ins. Co 240 Malone v. Boston & Worcester R. 33 Manary v. Runyon 54 Mance v. Hossington 139 Manchester v. Braedner 602 Manchester Paper Co. v. Moore. 400 Manetti v. Doege 144 Mangles v. Dixon 368 Manhattan Brass &c. Co. v. Thompson 195 Manly v. Hewlett 474 Mann v. Edinburgh Northern Tramways Co 513 Manning v. Anthony 98 Manning v. Sprague 294 Mansfield v. Gordon 181 Mansfield v. Hodgdon 32, 34, 211, 420 Mansfield v. Lynch 547 Mansfield v. Sherman. . . . .215, 403 Manter v. Churchill 29, 130 Mapes V. Sidney 39 Marble v. Standard Oil Co . . 61, 129 Marble Savings Bank v. Mesar- vey 342 March v. Pigot 123, 276 Marchant v. Morton, Down & Co 368 Marcovitch v. Liverpool V.F. Soc. 415 Marcy f. Marcy 102 Margraf v. Muir 257 Marion v. Faxon 97 Markham v. Jaudon 306 Marlow v. Pitfield 170 Marriot v. Hampton 647 Marsh v. Bulteel 292 Marshall v. Green 100 Marston v. Bigelow 354 Martell v. White 330 Martin v. Camp 165 Martin v. Green 207 Martin t). McCormick 210, 217 Martin v. Meles 40, 124, 143 Martin v. Murphy 477 Martin v. Royster 288 Martin v. Stubbings 283 Martin v. Wade 288 Martyn v. Hind 336 TABLE OF CASES xliii FAQE Marvin ti. Vedder 492 Marx V. McGlynn 267 Maryland Steel Co. v. United States 419 Mason v. Decker 103 Mason v. Eldred 390 Mason v. Intercolonial Ry 164 Mason v. Provident Clotlung Co . 299 Masterson v. Howard 162 Materne v. Horwitz .... 18, 284, 305 Mather v. Butler County 469 Mathewson v. Fitch 294 Matlock V. Gibson 86 Matthews v. Baxter 191 Matthews v. Matthews 107 Matthewson v. Johnson 183 Matthiessen &c. Co. v. McMahon.541 Mattock V. Kinglake 450 Maudlin v. Southern S. & B. Univ 171 Mavor v. Pyne 28, 464 Maxfield v. Schwartz 341 Maxim-Nordenfelt Co. v. Norden- felt 298,299 ■ May V. Hanson 391 May V. Lane 364 May ». Piatt 216 May V. Wilhams 96 Mayer v. Dean 534 Mayer v. New York 547 Mayer Const. Co. v. Amer. Ster- ilizer Co 420, 428 Maynard v. Corset Co 444 Maynard v. Hill 12 MajTiard v. Maynard 245 Majmard v. Render 400 Mayne's Case, Sir Anthony 447 Mayo V. Knowlton 517 Mayor v. Bailey 30 Mayor of Kidderminster v. Hard- wick 91 Mayor of Ludlow v. Charlton. . . 90 Meacham v. Jamestown R. Co. .291 Meadw. Ins. Co 208 Mease v. Wagner 97 Medbury v. Watson 247 Meech v. Stoner 318 Meguire v. Corwine 288 Meigs V. Dexiter 24, 53, 83 Meinhardt v. Newman 542 Melbourne &c. R. v. Louisville &c. R 134 Melchoir v. McCarty 310 Melhado v. Porto Alegre Railway Co 332 Melleny. Whipple 337, 341, 353 Melroy v. Kemmerer 138 Mentz V. Newwitter 103 Merriam v. Cunningham . . . 183, 186 Merriam v. WUkins 178 Merrick v. Giddings 144 Menrill v. Packer 129, 284 PAGE Merrill v. Peaslee 296 Merrill-Ruckgaber Co. v. U.S. . . 292 Merriman v. Barker 390 Merriman v. McManus 97 Merriman v. Moore 344 Merritt v. Earle 272 Merritt v. Merritt 541 Mersey Steel and Iron Co. v. Nay- lor 440, 452,453 Messiah Home v. Rogers 125 Metropolitan Electric Supply Co. u.Ginder 477 Metropolitan Life Ins. Co. v. Ben- der 82,84 Met. Trust Co. v. Topeka W. Co . 346 Meyer v. Dresser 403 Meyer v. Hartman 96, 351 Meyers v. Markham 447 Michaels v. Fishel 472 Michigan Bolt Works v. Steel ... 53 Middlebury College v. Chandler. 173 Middleton v. Hoge 180 Mighell V. The Sultan of Johore . . 164 Miles V. New Zealand Alford Est. Co 39, 130 Miles V. Schmidt 291, 473 MiUord v. Water Co 513 Millar's Karri Co. v. Weddel — 455 Mill-Dam Foundery v. Hovey . . .459 MiUerf. Ball 108 Miller v. Canal Co 292 Miller v. Covert 80, 497 MiUerw. MiUer 192 MiUerw. R. Co 517 Miller v. Sims 167 Miller ». Smith 184 Miller v. Wilson 108 Miller v. WincheU 345 MiUerd v. Thorn 483 Mills V. Brown 96 Mills V. Duryee 80 MiUs V. Larrance 88 Mills V. Wyman 125, 149 Millward v. Littlewood 124 Milnes v. Dawson 379 Mines de Barbary v. Raymond. .162 Minett v. Forester 540 Ming V. Corbin 452 Minneapolis & St. Louis Ry. v. Columbus RolUng Mill 62 Minnesota Lumber Co. v. White- breast Coal Co 62 Minnesota Oil Co. v. CoUier. .43, 50 Minnock v. Eureka F. & M. I. Co 341,355 Minock v. Shotridge 179 MinshuU v. Oakes 382 Mintz V. Tri-County N. G. Co. .389 Minzesheimer v. Doolittle 310 Mississippi &c. Co. v. Swift 64 Mitchell, Matter of 87 Mitchell V. Abbott 60 xliv TABLE OF CASES Mitchell V. Homfray 269 Mitchell V. Tomlinson 203 Mobile &c. Co. v. McMillan. ... 92 Moffett Co. V. Rochester 404 Mohr V. Miesen 281, 306 Moley V. Brine 167 Moloney v. Nelson 290, 316 MolsTieux V. Hawtrey 241 Monson v. Drakeley 389 Montagu v. Forwood 531 Montgomery v. American Cent. Ins. Co 481 Montgomery v. Downey 150 Montgomery v. Pickering 269 Montgomery Ward & Co. v. Johnson 62,70 Montreal Gas Company v. Vasey. 61 Moody V. Ins. Co 412, 415 Mooney v. Williams 511 Mooney v. York Iron Co 464 Moor V. Towle 80 Moore v. Darton 335 Moore v. Detroit Locomotive Works 136 Moore v. Elmer 150, 153 Moore v. Murdock 272 Moore v. Nowell 79 Moore v. Parker 247 Moore v. Phoenix Ins. Co 486 Moore v. Rogers 391 Moore v. Triplett 327 Moore v. Waddle 367 Moore v. Weston 542 Moran v. Dunphy 330 More V. Bennett 301 Morehouse v. Comstock 150 Morehouse v. Second N. B 497 Moreland v. Atchison 248 Morel Brothers & Co., Ltd., v. Earl of Westmoreland 509 Morgan v. Dod 210 Morgan v. Randolph-Clowes Co. 337, 341 Morgan v. Skiddy 255 Morgan v. Smith 391 Morgan v. Wordell 392 Morley v. Lake Shore Ry. 4, 12, 78, 545 Morley v. Loughnan 268 Morrell v. Studd 48 Morrill v. Wallace 223 Morris v. Baron 488 Morrison v. Rogers 296 Morrison v. Ross 367 Morrison, The Edwin 1 485 Morse v. Elms 79 Morse v. Ely 185 Morse v. Moore 226, 458, 460 Morse v. Wheeler 180 Morse v. Woodworth 262 Mortimore v. Wright 125 Morton v. Lamb 413, 451 Moses V. Macferlan 544, 547 Moshenz v. Independent Order of A. 1 433 Moss V. Averell 188 Moss V. Moss 5 Motherway v. Wall 248 Mott V. Water Co 346 Moulton V. Kershaw 53, 62 Mountstephen v. Lakeman 97 Moxon V. Payne 269 Moyer v. Cantieny 165 Muckenburg v. Haller 296 Muir V. Schenck 368 MulhoUand v. Bartlett 130 Muller V. Eno 327 MiiUer's Margarine Co. ». Inland Revenue 47 Mullings Clo. Co., Re 447 Mulvey v. King 219, 229 Munro v. Butt 466 Munroe v. Perkins 136, 487 Murchie v. Cornell 457 Murdock v. Finney 368 Murphin v. Scovell 241 Muiphy V. Hanrahan 362 Murray v. Beal 87 Murray v. Flavell :333 Murray v. New York life Ins. Co. 415 Murray v. Parker 404 Murray v. Snow 142 Musick V. Dodson 157 Musurus Bey v. Gadban 500 Muth V. Goddard 539 Mutual Life Ins. Co. v. Allen. . .283 Mutual Life Ins. Co. v. Phinney . .249 Mutual Milk &c. Co. v. Prigge 178, 477 Myer v. Wheeler 454 Myers v. Jenkins 291 Mygatt V. Coe 384 Myrick v. Dame 391 N Napier v. Darlington 241 Nash V. Armstrong 497 Nash V. Commonwealth 335, 353, 354 Nash V. De Freville 489 Nash V. Inman 171, 172, 173 Nassoiy v. Tomlinson. .139, 482, 497 Natal Land Co. v. Pauline Colliery Syndicate 513 National Bank v. Grand Lodge 337, 339, 341, 344 National Bank v. Matthews .272, 310 National Bank v. Petrie 314 National Benefit Co. v. Union Hospital Co ..300 National Benefit Society v. Wil- liamson 170 National Contracting Co. v. Hud- son River &c. Co 291 TABLE OF CASES xlv PAGE National Cordage Co. v. Sims 518, 525 National Exchange Bank v. Wiley 79 National Exchange Co. of Glas- gow V. Drew 535 National Furnace Company v. Keystone Mfg. Co 52 National Protective Ass'n v. Cum- ming 330 Nat. Trust Co. v. Gleason 547 Naumberg v. Young 399 Neale v. Neale 125 Neal's Ex'rs v. Gilmore 390 Neely v. Jones 327 Neff, In re 442 Neill V. Shamburg 246 Nesbit V. Lockman 267, 268 Nester v. Continental Brewing Co 300,301 Netterville v. Barber : 193 Neville v. Dominion of Canada News Co 285 NevUIe v. Kelly 30 New V. Walker 311, 375 Newberry Land Co. v. Newberry 339, 342, 347 Newbigging v. Adam 232, 233 New Bnmswick and Canada Rail- way Company v. Muggeridge. .242 Newburg Petroleum Co. v. Weare . 382 Newell V. Smith 521 New Hampshire &c. Co. v. Noyes 173 New B[aven v. New Haven D. & R. Co ...351 New Orleans &c. Ass'n v. Magnier 143, 345, 357 New Orleans &c. R. v. Duncan ... 31 Newton Rubber Works v. Gra- ham 414 New York, In re. City of 165 New York Bowery Fire Insur- ance Co. V. New York Fire In- surance Co 238 New York Building &c. Co. v. Fisher 183, 186 New York &c. Co. v. Dryburg. . 249 New York &c. Co. v. Memphis Water Co 364 New York Central R. Co. v. Beahan 32, 202 New York Co. v. Schuyler 368 New York Ins. Co. v. Aitken. . . 352 New York Life Ins. Co. v. Fletcher 240 New York Life Ins. Co. v. Sta- tham 485 New Zealand Co. v. Watson. . . .521 Niblo V. Binsse 435 Nichol V. Bestwick 490 Nicholu. Godts 457 Nichols V. Mudgett 288 Nichols V. Weaver 99 FA OB Nichols &c. Co. V. Snyder 182 Nicholson v. Bradfield Union .... 90 Nickelson v. Wilson 289 NickoU and Knight v. Ashton, Eldridge & Co 435 Niemeyer v. Wright 272 Nilson V. Morse 444 Nimmo v. Davis 265 Nims V. Ford 340 Nisbet & Potts, Re 385 Nix V. Bradley 194 Noble V. Kelly 87 Nocton V. Ashburton. .260, 261, 263 Noel V. Drake 285 Noel V. Murray 494 Nolan V. Whitney 412, 418, 424 Norcross v. James 385 Norcross v. Wyman 292 Nordenfelt v. Maxim-Nordenfelt Gun Co 298,299 Norden Steam Co. v. Dempsey. .402 Norrington v. Wright. .418, 454, 463 Northampton Ins. Co. v. Tuttle . . 43 Northcote v. Doughty 176 Northern v. Lathrop Ill Northern v. State 100 Northrup v. Northrup 449 Northwestern Cordage Co. v. Rice 226 Northwestern S. S. Co. v. Coch- ran 294 North W. R. Co. v. McMichael. . 167 Norton v. Coons 390 Nowack V. Berger 99 Nowlan v. Ablett 487 Noyes v. Anderson 471 Noyes ». Landon 516 Noyes V. Loring 235, 527, 628 Noyes V. Wyckoff 495 Nugent V. Smith 485 Nugent V. Wolfe. 96 Nye V. Hoyle 384 Nyulasy v. Rowan 67 O Oakes v. Cattaraugus Water Co. 513 Oakes v. Turquand ^ 268 O'Brien v. Boland 54 O'Brien v. Brietenbach 308 O'Brien v. Young 4, 12, 78, 645 Oceanic &c. Co. v. Compania T.E. 78 O'Connor v. Tyrrell 477 OdeU V. Webendorfer 101 O'Donald v. Constant 258 O'Donnell v. Chnton 203 O'Donnell v. Leeman. .104, 106, 396 Oeh-icks v. Ford 626 Offord V. Davies. 49, 60, 51 Ogdens Ltd. w. Nelson 447 Ogle V. Earl Vane 482 Oil Co. V. Nunnemaker 300 Olcott V. Bynum 471 dvi TABLE OF CASES FAQB Old Colony R. Co. v. Brockton R. Co 291,412 Old Colony Trust Co. v. Dubuque Co 250 Oliver v. Gilmore 300 OUive V. Booker 461 Olmstead v. Brush 337 Olmstead v. Latimer 136 O'Malley v. Associates 247 O'Neal V. Phillips 210 O'Neil V. Armstrong 447 O'Nea s;. Crain 115 O'Neill V. Amer. Leg. of Honor . . .351 O'Neill V. Supreme Coimcil. . . . .442 Onward Building Society v. Smith- son 84 Oppenheimer v. CoUins 296 Opper V. Hirsh 340 Ordinary v. Thatcher 84 Ormes v. Dauchy 320 O'Rorke v. Bolingbroke 266 O'Rourke v. John Hancock M. L. LCo 352 Ort V. Fowler 203 Orthwein v. Thomas 84 Ortman v. Weaver 50 Orton V. Scofield 517 Osborn v. Kistler 82 Osborn v. Martha's Vineyard R. Co 392 Osborn v. Nicholson 318 Osborne v. Amalgamated Soc. 189, 289 Osborne v. Cabell 352 Osborne v. O'Reilly 136 Oscanyan v. Arms Co 288, 319 Osgood V. Bauder 303 Osgood V. Cent. Vt. R 303 O'Shea, Re 279 Ostman v. Lee • 36 Owen V. Evans 369 Owen V. Farmers &c. Co 420 Owent). HaU 490 Owens V. Wilkinson 288, 303 Oxendale v. Wetherell 466 P Pabst Brewing Co. v. Liston . . . .317 Pacific Express Co. v. Shearer . . .207 Paddock v. Davenport 54 Paddock v. Strobridge 245, 246 Paddon v. Taylor 259 Paducah Lumber Co. v. Paducah W. Sup. Co 346 Page V. Cox 335 Page V. Higgina 217 Page V. Krekey 205 Page V. Morgan 115 Paget). Wells 516 Paget V. Marshall 216, 217, 404 Paine v. Benton 159 Paine v. Brown 450 PAGE Paine v. Loeb 530 Paine v. Upton 231 Pakas V. Hollingshead 469, 498 Palfrey v. Portland R 130 Palliser v. Gurney 195 Palmbaum v. Magulsky 285 Palmer v. Britannia Co 424 Palmer v. Fagerhn 296 Palmer v. Johnson 241 Palmer v. Miller 179 Pahner v. Temple 498 Palmer Sav. Bk. v. Ins. Co 126, 338, 341, 355 Palo Alto, The 55 Pangborn v. Westlake 271 Paper Stock D. Co. v. Boston D. Co 354 Paquin v. Beauclerk 195 Paradine v. Jane 432 Paris V. Strong 99 Park & Sons Co. v. Nat. Drug- gists' Ass'n 330 Parker v. Ibbetson 487 Parker v. Lambert 192 Parker v. Russell 443 Parker v. South Eastern Railway Company 33 Parks V. Wilson 89 Parlement Beige, The 164 Parmelee v. Cameron 265 Parmelee v. Lawrence 390 Parmelee v. Thompson 137 Parmentier v. Pater 262 Parmly v. Buckley 369 Parrish v. Thurston 213 Parrot v. Mexican C. R. Co 136 Parsons v. Loucks 114 Parsons v. Sutton .469 Parsons v. Taylor 274 Partridge v. Hood 289 Patrich, Re 367 Patrick v. Bowman 55, 527 Patterson v. Lippincott 177 Patterson v. Meyerhofer. . .411, 421 Pattinson v. Luckley 490 Pattle V. Hornibrook 65, 397 Paul V. Stackhouse 150 Payne v. Haine 401 Payne v. Mayor of Brecon 310 Paynter v. Williams 27, 154 Peabody v. Speyers 103, 120 Pearce v. Brooks 295, 304, 308 Pearce v. Gardner 103 Pearce v. Langfit 46 Pearl Life Insurance Co. v. John- son 85 Pearsall f. Western Union Tel. Co 249 PearsoU v. Chapin 21 Pearson v. Dublin Corporation. .535 Peck V. Heurich 294 Peck V. SterUng W. Co 346 TABLE OF CASES jdvii Peek V. Derry. 220, 233, 235, 236, 249, 251, 252 Peekw. Detroit Novelty Works. . 68 Peek V. Gurney 242, 245, 253, 254, 256 Peel V. Shepherd 531 Pelton V. Harrison 196 Peltz V. Eiohele 303 Penn v. Whitehead 167 Penn Ins. Co. v. Bank 240 Pennington v. Howland 425 Pennsylvania Coal Co. v. Blake . . 130 Pennsylvania Rubber Co. v. De- troit Shipbuilding Co 420 Pennsylvania Steel Co. v. New York C. R. Co 336, 442 Penobscot Fish Co. v. W. U. Tel. Co 205 People V. Barrett 81 People V. Board 517 People V. Call 490 People V. Dennison 164 People V. Glove Mut. Life Ins. Co 433 People V. Harrison 391 People V. Hayes 309 People V. Mercein 297 People V. Speir 12 People ex rel. Tel. Union Ins. Co. V. Nash 292 Peoples' Bank v. Bogart 213 Pepper v. Tel. Co 205 Perdew v. Tillma 482 Perkins v. Lockwood 142 Perkins v. State 518 Perry v. Barnett 307 Perry v. Dicken 294 Perry v. Ellis 501 Perry v. Mt. Hope Iron Co. . .43, 46 Perry v. Suffields 65 Peter v. Compton 101 Peters v. Davenport. 288 Peters v. Westborough 101 Peterson v. Breitag 132 Petroleum Co. v. Coal &c. Co . . . 52 Peugh V. Davis 266 Pfeifer v. Ins. Co 400 Phelps V. Johnson 479 Phelps V. McQuade 207 Phelps V. Worcester 173 Philadelphia v. Reeves 389 Philadelphia &c. Co. v. Cowell . . 514 Philadelphia &c. Co. v. Howard . 449 Philadelphia Baseball Club v. Lajoie 475 Phillip V. GaUant 211 Phillips V. Foxall 243 Phillips V. Gifford 274 PhiUips V. Meyers. . , 296 Phillips V. Moor 48, 50 Phillips V. Seymour 454 Phillips V. South Park Com'rs. . .294 Phinney v. Boston El. Co 355 — . . .^ PAGE Phipps V. Bacon 367 Phoenix Life Ins. Co. v. Raddin. .240 Pickard v. Sears 236 Pickens v. Vozell 459 Pickering v. Busk .510, 524 Pickering v. Ilfracombe Railway. 302 Pierce v. Feagans 498 Pierce v. Indseth 82 Pierce v. Seymour 499 Pierson v. Hooker 391 Pierson v. Morch 25 Pigot's Case 300 Pike V. Brown 96 Pike V. Pay" 229 Pike V. FitzGibbon 194 Pillans V. Van Mierop 77, 117 Pinches v. Swedish Church 466 Pinnel's Case 137, 138 Piper V. Fosher. 102 Pippen V. Ins. Co 182 Pitcairn v. Philip Hiss Co 424 Pitkin V. Noyes 114 Pittman v. Pittman 444 Pittsburg &c. R. v. HoUowell. . . 432 Pixley V. Boynton 281 Plant V. Bourne 104 Planters Oil Mill v. Monroe W. &L. Co 346 Plate V. Durst 60 Platner v. Patchin 12, 386 Piatt V. Brand 442 Plumb V. Campbell 274 Plumley v.V.S 292 Pneumatic Signal Co. v. Texas & P. R. Co 420 Poe V. Dixon 348 Poel V. Brunswick &c. Co 63 Polhill V. Walter 220, 253, 528 Poison V. Stewart 88, 296 Ponce V. Smith 424 Pond V. New Rochelle W. Co. 339, 343, 347, 357 Pond V. Smith 287 Pool V. Horner 150 Poor V. Hazleton 265 Pope V. AUis 457 Pope V. Cole 389 Pope V. Hanke 320 Pope V. Porter 342, 454 Pordage v. Cole 450 Porter v. Day 66, 273 Porter v. Freudenberg 162, 163 Porter v. Jackson 337 Porter v. Supreme Council 442 Porto Rico V. Title Guar. & S. Co.422 Posselt V. D'Espard 162 Post V. Thomas 132 Postal T. & T. Co. V. Wells 205 Poston V. Balch 314 Boston V. Williams 177 Potter V. DufEeld 104 Potts V. Dounce 390 xlviii TABLE OF CASES PAGE Poulton V. Lattimore 458 Powell V. Powell 267 Powell & Thomas v. Evan Jones &Co 521 Power V. First Nat. Bk 521 Powers V. Bumcratz 41 Powles V. Innes 362 Pratt V. Trustees 47, 143 Presbyterian Church v. Cooper 143 Prescott V. Jones 36 Pressley v. Kemp 264 Prested v. Gardner 115 Preston v. Prather 134 Preston v. Tooley 133 Price V. Barker 390 Price V. Easton 331 Price V. McEachern 140 Price V. Sanders 173 Price Brokerage Co. v. Chicago, etc. R. Co 205 Priestly v. Fernie 532 Prime v. Koehler 98 Printing Co. v. Sampson 286 Pritohard v. Norton 6 Proctor V. Cole 294 Proctor V. Sears 180 Prosser v. Edmonds 295 Protector Loan Co. v. Grice. . . . 472 Prout V. Pittsfield Fire Dist 132 Prout V. Wiley 180 Providence Tool Co. v. Norris. . .288 Pugh V. MiUer 367 Pulitzer Pub. Co. v. McNichoIs. . 272 Purner v. Piercy 100 Purvines v. Harrison 404 Pust V. Dowie 460 Putnam v. Field 353 Putnam v. Tennyson 157 Putnam v. Woodbury 146 Pye V. British Automobile Syndi- cate . 471 472 Pym V. Campbell. .' . . . .65, 397^ 409 Pyne v. Wood 173 Q Quigg V. Quigg 186 Quimby v. Vanderbilt 33 Quinn v. Leathem 329, 330 Quirk V. Thomas 387 R Raabe v. Squier 98 Radich v. Hutchins 262 Raffles V. Wichelhaus 32, 208 Raikoad Co. v. Mfg. Co 33 Railroad Co. v. National Bank. .159 Railroad Co. v. Reeves 486 Railway Co. v. Stevens 33 Rainbow v. Howkins 523, 541 Raipe v., Gorrell 150 Raisin v. Clark 517 Ramsey v. Whitbeck 303 Ramsgate Hotel Co. v. Montefiore SO Rand v. Mather 98 FAOB Randall v. Dudley 188 Randall v. Howard 284 Randall v. Kehlor 623 Randall v. Randall 296 Randall v. Sweet 173 Randolph Iron Co. v. Elliott 206 Ranger v. Thalmaim 532 Rann v. Hughes 77, 95, 118, 159 Rapp V. Phoenix Co 244 Rappleye v. Racine Seeder Co. . .486 Ran V. Von Zedlitz 269 Ray V. Thompson 123 Ray w. Tubbs 187 Rayburn v. Comstock 444 Raymond v. Farmers Ins. Co. . .291 Raymond v. Parker 281 Rayner v. Wilson 241 Raysor v. Berkeley Co 36 Read v. Anderson 306, 539 Read v. Batchelder 156 Read v. Ins. Co 291, 412, 418 Rea4y ". Pinkham 181 Record v. Chisum 392 Rector v. Teed 126, 338 Redgrave v. Hurd 231, 240 Reece v. Kyle 294 Reed v. Brewer 295 Reedw. Ins. Co 407 Reed v. Loyal Protective Associa- tion 428 Reed v. Paul 338, 351, 355 Reed v. Pierce 502 Reed v. Randall 227 Rees V. de Bernardy 295 Reese River Mining Co. v. Smith.221 Reeve v. Jennings 102 Reeves v. Bluff City Bank 351 Regina v. Demers 52 Regina v. Wilson 169 Reidy's Est., In re 272 Reif V. Paige 25, 149 Reinheimer v. Carter 102 Reinskopf v. Rogge 191 Relief Fire Ins. Co. v. Shaw 92 Remington v. Broadwood 509 Renihan v. Wright 470 Resseter v. Waterman 96 Reuss V. Picksley 103 Renter v. Sala 463 Reynell v. Sprye 313 RejTiold V. Purchowe 137 Reynolds v. Garber-Buick Co . . . 185 Reynolds v. Nugent 136, 143 Reynolds v. Robinson 65, 397 Reynolds v. Stevenson 272 Rhoades v. Malta Vita Co 284 R. H. White Co. v. Remick . . .443 Rhymney Railway Co. v. Brecon Railway Co. 440 Rice V. Boyer 186 Rice V. Butler 173, 184 Rice V. Groflmann 523 Rice V. Manley 330 TABLE OF CASES xlix Rich V. New York Central &c. R . 11 Richards v. Delbridge 333 Richards ». Green 474 Richards v. L. B. & S. C. Rail- way Co 460 Richards v. Starck 273, 279 Richardson v. Brix 272 Richardson v. Buhl 300 Richardson v. Mead 367 Richardson v. Richardson 99 Richardson v. Rowland. . . .294, 320 Richardson v. Rowntree 34 Richardson v. WiUiamson 528 Richlands &c. Co. v. Hiltebeitel . 402 Richmond v. Moore 272 Ricketts v. Scothorn. . .125, 142, 237 Riddiford v. Warren 231 Riddle v. Backus 101 Riegel v. Ins. Co 209 Rigdon V. Walcott 258 Riggs V. risk 182 Rigney w. N. Y. Cent. R. Co . 339, 357 Riley v. Dillon 181 Rindge v. Kimball 159 Ring V. Devlin 67 Ripley v. McClure 420, 444 RitchSe V. Atkinson 453 Eitchie v. Boynton 272 Ritchie v. McMullen 79 Rittler v. Smith 283 River Steamer Co., In re 501 Roberts v. Cobb 142 Roberts v. Donovan 244 Roberts v. Gray 171, 172, 174 Roberts v. Lemont 300 Roberts v. Security Co. . .24, 83, 84 Robertson v. Robinson 288 Robinson, Re 499 Robinson v. Davison 436 Robinson v. Harman 467, 469 Robinson v. Heuer 477 Robinson v. Hurst 126 Robinson v. Jewett 137, 146 Robinson v. Magee 10 Robinson v. Mollett 520 Robinson v. Read 494 Robinson v. Templar Lodge 291 Robinson v. Threadgill 133 Robson & Sharpe v. Drummond.360 Rochelle v. Pac. Ex. Co 67 Rochester Lantern Co. v. Stiles &c. Co 361,468 Rockford &c. R. v. Sage 513 Rockwell V. Elkhorn Bk 188 Rodenbarger v. Bramflett 348 Rodgers v. NUes 457 Rodliff V. Dallinger 19, 207, 217 Roebling's Sons' Co. v. Fence Co. 440,444 Roehm v. Horst 442 Rogers v. Galloway F. Coll 339 Rogers v, Higgins 269 Rogers V. Parry 297 PAGE Rogers v. Rogers 136 Rogers Co. v. Rogers 17, 475 Rogers Locomotive Works v. Kelley 326 Rohan v. Hanson 173 Roland v. Coleman 539 Rollins V. Marsh 481 Rooke V. Dawson 68 Roper V. Johnson 469 Rorabacher v. Lee 392 Roscorla v. Thomas 150 Rosenbaum v. United States Credit Co 308 Rosenheim v. Ins. Co 238 Ross V. Conway 267, 268 Ross V. Drinkard's Adm'r 248 Ross V. Hurd 159 Ross V. Payson 268 Ross V. Union Pac. Ry 474 Rossiter v. Miller 64, 104 Rotherham Alum Co., In re. . . .333 Rothholz V. Schwartz 473 Rothschild v. Brookman 519 Roumania v. Guaranty Trust Co . 164 Roundtree v. Baker 318 Roundtree v. Smith 281 Rovegno v. Defferari 18, 200 Rowe V. Peabody 431 Rowe V. Rand 540 Rowland v. New York &c. R.200, 211 Rowley v. Bigelow 19, 259 Rowley v. Stoddard 391 Royal Ins. Co. v. Beatty 35, 36 Ruckman v. Pitcher 317, 318 Ruckman v. Ruckman 83 Rugg V. Moore 452, 454 Rumball v. Metropolitan Bank. .373 Runkle v. Kettering 1.S5 Ruimamaker v. Cordray 80 Rupley V. Daggett 200 Rupp V. Sampson 517 Russell V. Briggs 110 RusseU V. Cook 130, 139 Russell V. Falls Mfg. Co 62 Russell V. Longmoor 490 RusseU V. Stewart 30 Russell V. W. U. Tel. Co 249 Ryan v. Dayton 444 Ryan v. Hamilton 299 Ryan v. Mutual Tontine Associa- tion 473 Ryan v. United States 104 Ryder v. Loomis 104 Ryder v. Wombwell 172 Ryerson v. Hendrie 389 S Saffrey v. Mayer 279 Saint V. Wheeler &c. Co 244 Saint Louis v. Von Phul 339, 357 Saint Louis &c. Ry. v. Hardy. . . 70 Saint Paul F. & M. I. Co. v. Upton 411 TABLE OF CASES PAGE Salander v. Lockwood 205 Salisbury v. Howe 220, 250, 253 Salisbury v. Shirley 382 Salley v. Terrill. . 205 Salmon Falls Mfg. Co. v. God- dard 106 Salsbury v. Ware 516 Salton V. New Beeston Cycle Co. 541 Sample «. Barnes 310 Sampson Co. v. Commonwealth. .354 Samuel v. Cheney 207 Sanborn v. Cole 396 Sanborn v. Flagler 106 Sanders v. Carter 472 Sanders v. Partridge 526 Sanders v. Pottlitzer &c. Co . . 64, 65 Sanford v. Brown Bros. Co 40 Sanford v. First N. Bk 472 Sanger v. Hibbard 179 Santa Clara &c. Co. a. Hayes . 300, 303 Santos V. lUidge 318 Sapwell V. Bass 469 Sarasohn v. Kamaiky 83 Sard V. Rhodes 493 Sargent v. Adams 407 Sarkisian v. Teale 114 Sasportas v. Jennings 262 Satanita, The 66 Saunders v. Newbold 266 Saunders v. Ott 173 Saunderson v. Piper 401 Saveland v. Green 515 Savings Bank v. Burns 313 Savings Bank v. Shaffer 490 Sawyer v. Lufkin 192 Saxby v. Fulton 279, 319 Sayer v. Wagstaff 493, 494 Scales V. Chambers 69 Sceva V. True 192 Schaps V. Lehner 191 Schemesohn v. Lemonek 165 Schell V. Stephens 523 Schemerhorn v. Vanderheyden 127, 339 Schenectady Stove Co. «. Hol- brook 49, 62 Schlee v. Guckenheimer 49 Schmaling v. Thomlinson 328 Schmaltz v. Avery 530 Schmand v. Jandorf 426 Schmidt v. Pfau 502 Schmitheimer v. Eiseman . . 183, 186 Schnaier v. Bradley Cont. Co . . . 357 Schnell v. Nell 120, 124 School Directors w.Boomhour. . .229 School District v. Dauchy 431 School District v. Livers 335, 345,353 Schooner Reeside, The 403 Schoonmaker v. Hoyt 85, 489 Schroder v. Mendl 231 Schuler v. Myton 146 Schultz V. Johnson 361 Schumaker v. Mather 256 PAGE Schweider v. Lang 497 Scofield V. Clark 390 Scotson V. Pegg 144 Scott V. Avery 290, 291, 412 Scott V. Bryan 97 Scott V. Coulson 209, 430 Scott V. Lifford 378 Scott V. Littledale 214 Scott V. Morley 196 Scotten V. State 313 Scottish-American Mortgage Co. V. Davis 45, 47 Scriven v. Hindley 214 Scroggin v. Wood 229 Scudder v. Bank. . 6, 108 Seager, In re 187 Seale v. Baker 221, 250 Sears v. Eastern R 55, 70 Sears v. Grand Lodge 210 Sears v. Leland 210 Seaton v. Heath 237, 243 Seaton v. Tohill 474 Seaver v. Ransom 340, 356 Seddon v. North Eastern Salt Co .233 Sedgwick Co. v. State 303 Seeberger v. McCormick. . .235, 527 Seeley's Appeal 296 Semmes v. Hartford Ins. Co. 412, 418, 427 Serviss i>. McDonnell 341 Sessions ». Johnson .391 Sevier v. Birmingham &c. R. . . .511 Seward v. Mitchell 123 Seymour v. Armstrong 63 Seymour v. Bridge 306 Seymour v. Delancy. . . .88, 121, 265 Seymour v. Marlboro 150 Shaber v. St. Paul Water Co. . . .384 Shadwell v. Shadwell 125, 143 Shahan v. Swan 110 Shanley v. Koehler 138 Sharington v. Strotton 73, 125 Sharp V. Conkhng 392 Sharpless' Appeal 157 Shaw V. Rai&oad Co 381 Sheeren v. Moses 450 Sheldon v. Capron 208 Sheldon v. Davidson 248, 256 Sheldon v. Haxtun 157 Shelton's Case 83 Shelton v. EUis 213, 404 Shelton v. Johnson 165 Shenk v. Mingle 309 Shepard v. Carpenter 64 Shepard v. Rhodes 120, 149, 157 Sherman v. KitsmUler 61, 129 Sherman v. Leveret 413 Sherrerd v. W. U. Tel. Co 205 Sherry v. Perkins 330 Sherwin v. Brigham 146 Sherwin v, Fletcher 142 Sherwood v. Stone 525 Sherwood i;. Walker. . .209, 211, 217 TABLE OF CASES PAOE ShingleuT v. W. U. Tel. Co 205 Shipley v. Bunn 182 Shipley v. Carroll 205 Shipton & Harrison's Arbitra- tion, In re 434 Shipway v. Broadwood 617 Shirk V. Shultz 167 Shisler v. Vandike 514 Shook V. Singer Mfg. Co 229 Short V. Home Ins. Co 239 Short t). Stotts 99 Shuey v. United States. . . 39, 51, 55 Shupe V. Galbraith 29, 130 Sibley v. Felton 64 Siegel, Cooper & Co. v. Eaton & Prince Co 435 Sigerson v. Mathews 159 SUer V. Gray 386 Silsbee v. Webber 262 Silsby Mfg. Co. v. Chico 426 Silver v. Graves 61, 132 SUverthorn v. Wylie 150 Simar v. Canaday 247 Simmons v. Clarke 482, 497 Simmons Hardware Co. w. Waibel . 477 Simon v. Etgen 421 Simon v. Merritt 378 Simons v. Amer. Legion of Honor.132 Simons v. Bedell 339 Simpson v. Crippin 453 Simpson v. Evans 136 Simpson v. Hart 79 Simpson v. Ins. Co 173, 185 Simpson v. L. & N. W. Railway Co 469 Simpson v. Waldby 521 Sims V. Everhardt 180, 183, 186 Sims V. Ferrill. 248 Singer v. Carpenter 473 Singer Mfg. Co. v. Lamb 182 Singerly v. Thayer 426 Singleton v. Bremar 309 Skeet V. Lindsay 501 Skeete v. Silberbeer 144 Skelton v. L. & N.W. Railway Co.l34 Skiff V. Stoddard 520 Skipper v. Holloway 370 Skordal v. Stanton 125 Slack V. Rees 264, 267 Slade V. Mutrie 481 Slade's Case 16, 544 Slater v. Jones 142 Slater Woollen Co. v. Lamb. . 18, 190 Slaughter v. Davenport 391, 392 Slaughter's Adm'r v. Gerson. . . .256 Slayton v. Barry 186 Shngsby's Case 392 Sloan V. Hayden 426 Slocum V. Bracy 489 Small V. Schaefer 363 Smalley ». Greene 102 Smart v. Hyde 412 Smart v. Sandars 539 _ _ PAQB Smart v. Smart 96 Smart v. Tetherly 363 Smart v. White 313 Smith V. Arnold 272 Smith V. Bettger 494 Smith V. Boston, etc. R.R 293 Smith V. Bricker 231 Smith V. Chadwick 251 Smith V. Clinton 284 Smith V. Collins 81 Smith V. Countryman 257 Smith V. Crockett Co 284 Smith V. Gold Coast Co 101 Smith V. Hale 258 Smith V. Hayward 444 Smith V. Hughes 211, 213, 256 Smith V. Josselyn 243 Smith V. Kay 268 Smith V. Kelly 481 Smith V. Kerr 508 Smith V. Land & House R-operty Co 234 Smith V. Mace 490 Smith V. Mackin 404 Smith V. Mawhood 271 Smith V. Mayor 68 Smith V. Monteith 132 Smith V. Nassau &c. R 133 Smith V. Pfluger 348 Smith V. Putnam 100 Smith V. Richards 231, 309 Smith V. Smith (125 N.Y. 224). .474 Smith V. Smith (134 N.Y. 62) . . .203 Smith V. State 30 Smith V. Tripp 159 Smith V. WMdin 67, 135 Smith V. Wilson 402 Smith's Appeal 303 Smits V. Hogan 294 Smout V. Ilbery 542 Smyth V. New York 339, 357 Smyth V. Sturges 241 Snook V. Fi:ies 452 Snyder v. Pharo 327 Societa Italiana v. Sulzer 338 Soci6t6 Maritime v. Venus Co . . . 15 Solicitor, Re a 293 Solon V. Williamsburgh Sav. Bk. 82 Somerby v. Buntin 112 Somes V. Brewer 21 Sondheim v. Gilbert 311 Sooy V. New Jersey 243 Soper V. Gabe 450 Southard v. Boyd 288 Southard v. Curley 404 Southern Development Co. v. Silva 231,234,244 Southern Pacific Co. v. American Well Works 464 Southern R. Co. v. Huntsville L. Co 64 South of Ireland Colliery Co. v. Waddle 90 lii TABLE OF CASES PAGE South Wales Miners Federation v. Glamorgan Coal Co 329 Southwell V. Bowditch 625, 529 Soutier v. Kellerman 402 Spaids V. Barrett 262 Spalding v. Mason 467 Spalding v. Rosa 428, 435 Spangler v. Danforth 103 Sparman v. Keim 167 Spear v. Griffith 126 Spence v. Ham 424 Spencer v. Dearth 292 Spencer v. Harding 68 Spencer's Case - 382 Spicer v. Earl 180 Spier V. Hyde 479, 481 Spiller V. Paris Skating Rink. . . .332 Spinney v. Downing 64 Spinney v. Hill 107 Spring Co. v. Knowlton 308, 315 Spun- V. Benedict 229, 230 Stafford v. Roof 182 Stamford Banking Co. v. Smith . . 602 Stamper v. Temple 30 Standard Fashion Co. v. Siegel- Cooper Co 474 Standard Gas P. Co. v. New Eng. Casualty Co 345 Standeford v. Devol 192 Stanford v. McGill 440, 442 Stanley v. Jones 295 Stanley &c. Co. v. Bailey 217 Stanton v. Dennis 64 Stanton v. Embrey 498 Stark V. Parker 466 Starkey v. Bank of England. 234, 627 Star Pub. Co. v. Associated Press . 300 Starr v. Torrey 458 Startup V. MacdonaJd 494 State V. Collier 288 State V. Fox 254 State V. Lattanner 125 State V. McGuire 81 State V. Weatherwax 81, 173 State V. Williamson 289 State Bank v. Kirk 125 State of Maine v. Chandler 81 Stearns v.Hall 488 Stebbins v. Walker 531 Steeds v. Steeds 487 Steefel v. RothschUd 247 Steele v. Clark 327 Stees V. Leonard 487 Steffens v. Nelson 510 Steffes V. Lemke 353 Steinback v. Diepenbrock 283 Steinmeyer v. Schroeppel 211 Stensgaard v. Smith 36, 54 Stenton v. Jerome 262 Stephani v. Lent 164 Stephens v. Board of Education . 547 Sterling v. Sinnickson. . .88, 296, 396 Stevens v. Coon 129 FAGS Stevens v. Flarmagan 358 Stevens v. Fuller 246 Stevens v. Giddings 241 Stevens v. Ludlum 237, 254 Stevens v. Philadelphia Ball Club 377 Stevenson v. McLean 55, 62 Stewart v. Bank 490 Stewart v. Eddowes. 103 Stewart v. Kennedy 7 Stewart v. Ketelas 136 Stewart v. Stone 435 Stewart v. Wyoming Ranch Co. 213, 245 Stiebel v. Lissberger 519 Stier V. Ins. Co 539 Stilk V. Myrick 136 Stockport Waterworks Co. v. Potter 384 Stocks V. Dobson 367 Stocks V. Wilson 186, 187 Stockton V. Gould 489 Stoddard v. Ham 206 Stoddard v. McAuhffe 317 Stoddart v. Union Trust 369 Stone V. Bale 83 Stone V. Carlan 256 Stone V. Dennison 107, 171 Stone V. Dysert 30 Stone V. Harmon 50 Stonebirrner v. Motley 150 Stoney Creek Co. v. Smalley 247 Stong V. Lane 208 Storey v. Brennan 317 Storm V. United States 86 Storrs V. Hospital 295 Story V. Lovett 395 Story V. Salomon 281 StovaU V. Barnett 125 Stovall V. McCutchen 143, 473 Stowe V. Flagg 189 Stowell's Adm'r v. Drake 391 Strain v. Wright 185 Strasser v. Conklin 514 Straus V. Cunningham 157 Strawboard Co. v. Bonfield 300 Streator v. Paxton 467 Streeper v. WUIiams 470 Street v. Blay 458, 461 Streeter Co. v. Janu 85, 87 Strevell v. Jones 125 Strickland v. Wilhams 470 Strong V. Foote 173 Strong V. Sheffield 39, 130 Strong V. W. U. Tel. Co 205 Stroud V. Smith 288 Stuart V. Joy 383 Stucley, Li re 499 Studley v. Ballard 135 Studwell V. Shapter 186 Stuht V, Sweesy 150 Sturges V. Crowninshield. . . .10, 502 Sturm V. Boker 248 Suaiez, Be 164 TABLE OF CASES liii FAGB Suffell V. Bank of England 490 Suit t). Woodhall 535 Sullivan v. Jennings 215 Summers v. Hibbard 63 Summers v. Hutson 368 Summers v. Vaughan 150 Sundberg v. Goar 389 Sun Mutual Ins. Co. v. Ocean Ins. Co 238 Superior Land Co. v. Bickford. . . 143 Supreme Council of R. A. v. Beh- rend 352 Sutch's Estate 150 Sutherland v. Reeve 368 Sutton V. Griebel 398 Suydam v. Barber 389 Svanburg v. Fosseen 110 Swain v. Schieffelin 469 Swain v. Seamens 488 Swan V. Maritime Insce. Co. . . .371 Swan V. Nesmith 98, 525 Swann v. Swann 319, 320 Swasey v. Vanderheyden 171 Sweigart v. Berk 391 Swentzel v. Penn Bank 134 Swift V. Hawkins 86 Swift Co. V. United States 547 Swigert v. Tilden 300 Sykes v. Chadwick 121 Synge v. Synge 28, 144 T Taddy v. Sterious 385 Tailby v. Official Receiver 366 Taintor v. Prendergast 531 Talbert v. Storum 87 Talbot V. Bowen 507 Talbot V. Pettigrew 62 Talbot V. Van Boris 376 Talbott V. Hooser 264 Talcott V. Henderson 248 TampUn v. James 215 Tanner v. Merrill 139 TarbeU v. Stevens 70 Tatam v. Haslar 312, 376 Taimton v. Pepler 82 Taussig V. Hart 517, 519, 520 Tayloe v. Merchants' Fire Ins. Co. 43,55 Taylor v. Bemisa 294 Taylor v. Blanchard 298 Taylor v. Bowers 315 Taylor v. Brewer 129 Taylor v. Caldwell 434 Taylor v. Great Eastern Railway Company 115, 116 Taylor v. Laird 31, 148 Taylor v. Leith 219 Taylor v. Saxe 458 Taylor v. Smith 115 Taylor v. Weeks 130 Taylor & Co., Assigned estate of L.H 281 Tedrick v. Hiner 272 Teipel v. Meyer 53 Temperton v. Russell 334 Tennessee Bank Note Holders v. Funding Board 490 Terkelsen v. Petersen 296 Terre Haute &c. R. v. McMurray 511 Terry v. Birmingham Bank 520 Terry v. Tuttle 203 Thacker v. Hardy 273, 281 ThaUhimer v. Brinckerhoff 294 Thayer v. Burchard 52 Thayer v. Daniels 368 Thayer v. Knote 213 Thayer v. Luce 104 Theiss V. Weiss 60 Therne v. Fuller 39 Thiis V. Byers 432 Thomas v, Atkinson 532 Thomas v. Brown 193 Thomas v. Hayward 383 Thomas v. Knowles 434 Thomas v. Raikoad Co 190 Thomas v. Stewart 464 Thomas v. Thomas 123 Thomas Mfg. Co. v. Prather . . .345 Thompson v. Brown 424 Thompson v. Lay 179, 180 Thompson v. Rose 382 Thompson v. Stevens 60 Thompson v. Whitman 79 Thomson v. Davenport. . . .529, 530 Thomson v. Way 137 Thomson-Houston Eleo. Co. v. Capitol Traction Co 536 Thorington v. Smith 407 Thorn v. Knapp 470 Thorne v. Deas 134 Thornett v. Haines 69 Thornhill v. Neats 483 Thornton v. lUingworth 178 Thornton v. Village of Sturgis 31 Thoroughgood's Case 83, 84, 203 Thorp V. Keokuk Coal Co. 339, 341, 342 Thorp V. Thorp 122 Thurnell v. Balbirnie 412 Thurston v. Arnold. . .399, 462, 474 Thurston v. Blanchard 258 Thwing V. Hall &c. Co 209 Tice V. Freeman 104 Ticonic Bank v. Smiley 546 Tiedeman v. Knox 381 Tiedemann v. Ledermann 512 Tier v. Lampson 539 Timme v. Kopmeier 285 Tindle v. Birkett 254 Tinker v. Hurst 284 Tinkler v. Swaynie 351 Tinn v. Hoffman 62 Tipton V. Feitner 451 Tisdale v. Harris 102 Titus y, Ins. Co 248 liv TABLE OF CASES Tobey v. County of Bristol 292 Tobey v. Wood 180 Tobias v. Rogers 390, 646 Todd V. Weber 339, 356 Tolhurst V. Powers 135, 262 Tolhurst's Case 365, 366 Tomlinson v. Gill 335 Tompkins v. Dudley 431 Tool Co. V. Norris 288 Torkington v. Magee. .362, 366, 370 Tornado, The 435 Totten V. Burhans 250 Touche V. Metropolitan Ware- housing Co 332, 335 Tourigny v. Houle 79, 80 Tower-Doyle Com. Co. v. Smith 184, 185 Towle V. Dresser 182, 183 Town V. Ukiah W. & I. Co 346 Towner v. Tickner 241 Townsend v. Felthousen 250 Townsend v. Hargraves 108 Townson v. Tickell 24 Tracy v. Albany Exchange Co . . . 449 Tracy v. Talmage 305, 313, 314 Trader v. Lowe 180 Traders' Bank v. Alsop 311 Traders' Co. v. Herber 243 Traer f. Clews 295 Trainer v. Morison 523 Trainer v. Trumbull 171 Traver v. 124 Traver v. Halsted 444 Travis v. Nederland &c. Co. . . . 51 Trenton &c. Ins. Co. v. Johnson 276, 282 Trenton Potteries Co. v. Olipbant. 300 Trevor v. Wood 43 Trimble v. Reid 250 Trimble v. Strother 352 Trippe v. Provident Fund Soc. . .428 Tristu. Child 288 Troewert v. Decker 272 Trueblood v. Trueblood 18, 177 Trueman v. Fenton 156 Trueman v. Loder 103, 531 Trustees v. Bennett 431 Trustees v. Haskell 143 Trustees v. Jessup 400 Tuck V. Downing 247 Tucke V. Buchholz 267 Tucker v. Boston 421 Tucker v. White 219 Tufts V. Lawrence &c. Co 444 Tulk V. Moxhay 385 Tullis V. Jacson 418 Tupper V. Cadwell 173 TurnbuU v. Payson 78 Turner v. Gaither 173, 180 Turner v. McFee 159 Turner v. Melladew 109 Turner v. Owen 137 Turner v. Stallibrass 74, 133 Turner v. Ward 231 Turner v. Whitmore 391 Tweddle v. Atkinson 331, 340 Tweeddale v. Tweeddale. . .339, 352 Twenty-third Street Baptist Church V. Cornell 47 Tyler v. Carlisle 277, 305 Udell V. Atherton 534 UUman v. Meyer 99 tniman v. St. Louis Fair Ass'n. . .316 Underwood v. Barker 299 Underwood v. DoUins 82 Union Bank v. Sullivan. ... 117, 125 Union Inst. v. Phoenix Ins. Co. 336, 341, 355 Union Nat. Bk. v. Chapman .... 6 Union Nat. Bk. v. Ins. Co 535 Union Trust Co. v. Grosman 6 United Press v. New York Press Co 61, 129 United States v. Behan.421, 441, 469 United States v. Bradley 303 United States v. Carhn Const. Co 64 United States v. Eckford 164 United States v. Grossmayer.162, 287 United States v. Nat'l Sur. Co. . .353 United States v. New York &c. S.S. Co 93 United States v. Peck 422 United States v. Price 391 United States v. Quigley 162 United States v. Simons 67 United States v. United Eng. & Con. Co 420 United States v. Wilkins 164 United States Fidelity Co. ». Riefler 83 United States F. & G. Co. v. U. S.351 U. S. Mortgage Co. v. Henderson.132 Unity &c. Ass'n, Ex parte. .183, 187 Universal Stock Exchange v. Strachan 281 Universo Co. v. Merchant's M. Ins 127 Upfill V. Wright 305 Up River Ice Co. v. Denier 299 Upton V. Tribilcock 242, 248 Urquhart v. Brayton 342 Vail ti. Reynolds 257 Valade v. Masson .389 Valentini v. Canali 170 Vanbrunt v. Singley 203 Vanbuskirk v. Hartford Fire Ins. Co 368 Van Clief v. Van Vechten 424 Vanderbilt v. Schreyer 135 Van Eman v. Stanchfield. . . 126, 338 Van Santen v. Standard Oil Co . . .546 TABLE OF CASES Iv VanShaack v. Robbins 21 Vanuxem v. Burr 80, 497 Van Wyck v. Brasher 191 Varney ». Ditmars 61 Vassar v. Camp 44 Vegelahn v. Guntner 330 Venezuela Railway Company v. Kisch 242 Victoria Lumber Co. v. Wells. . .353 Vigo AgTi Soc. V. Brumfiel 66 Vilas V. Downer 165 Vitty V. Eley 30 Vreeland v. Vreeland 110 Vrooman v. Turner 339, 342, 343, 356 Vulcan V. Myers 256 Vynior's Case 292, 421 W Wabash Western Ry. v. Brow.87, 479 Waddell v. Mordecai 625 Wade V. Kalbfleisch 387 Wade V. Simeon 132, 135 Wadsworth v. Sharpsteen 191 Waggoner v. Cox 471 Wagniere v. Bunnell 101 Wagoner v. Watts 508 Wahl V. Barnum 101, 132, 139 Wain V. Warlters 105 Wainwright v. Queens Co. W. Co.346 Wake V. Harrop 394, 400 Wakeham v. Barker 17 Wakeman v. Dalley 219 Wakeman v. Wheeler & Wilson Mfg. Co 469 Walden ». Louisiana Ins. Co. 211, 239 Waldheim v. Miller 400 Waldron v. Mtirphy. 495 Wales V. Stout 95 Walker, Re 191 Walker v. Bradford Old Bank 367, 371 Walker v. Brooks 364 Walker v. Cronin 329, 330 Walker v. Ebert. . . 18, 203, 375, 396 Walker v. Herring 523 Walker v. Mauro 370 Walker v. Osgood 517 Walker v. Supple 112 Walker v. Walker 102 Walker v. Whitehead 10 Wall V. Rederiaktiebolaget Lug- gude 560 Wallace v. Leroy 178, 183 Wallace v. Long 107 Wallace v. Raffleye 295 Wallace v. Townsend 47 Wallin V. Highland Park Co 171 Wallis, Inre 387 Wallis V. Pratt 223, 224 Wallis V. Smith 472 Walls V. Bailey 402 Walls' Appeal. 60 Wain V. Wain 87 Walsh V. Fisher. , 432 Walsh V. Powers 181 Walsh V. St. Louis &c. Ass'n 69 Walter v. Bloede Co 48f) Walton V. Gaines 181 Walton V. MascaJl 495 Wambole v. Foote 640 Wanamaker v. Weaver 509 Wanderer's Hockey Club v. John- son 284 Waples V. Hastings 177 Warburton v. Storr 292, 421 Ward V. De Oca 342 Ward V. Hobbs 246 Ward V. Monaghan 471 Ward V. Morrison 368 Ward V. Warren 412 Wardell v. Eden 362 Wardner v. Jack 367 Ware v. Allen 398 Ware v. Chappell 460 Warlow V. Harrison 69 Warner ». Texas & Pac. R 101 Warner v. Whittaker 369 Warnock v. Davis 275, 283 Warren v. Batchelder 347, 363 Warren v. Hodge .'.... 137 Warren v. Lynch 82 Warren v. Mayer Mfg. Co 488 Warren v. Warren 110 Washburn v. Fletcher 44 Washer v. Independent M. & D. Co 360,363 Waters v. Bean 157 Waters v. Tompkins 502 Watertown &c. Co. v. Simmons. . 244 Watkins v. Nugen 310 Watkins v. Robertson 64 Watkins v. Rymill 31 Watson, In re 512 Watson V. Murray 320 Watson V. Russell 46 Watson V. Silsby 248 Watson V. Swann 612 Watson V. Turner 153 Watteau v. Fenwick 631 Watts V. Creswell 183 Watts V. Howard 523 Watts V. Kavanagh 539 Watts & Co. V. Mitsui & Co. .. .431 Waugh V. Emerson 184 Waugh V. Morris 308 Way V. Ryther 247 Way V. Sperry 166 Weaver v. Burr 60 Weaver v. Jones 184 Weber v. Bridgman 542 Webster v. Bosanquet 471 Webster v. Cecil. .215, 217, 403, 474 Weeks v. Currier 221, 260 Weeks t). Esler 377 Weeks v. Tybald 59 Ivi TABLE OF CASES PAGE Weeks v. Wilkins 180 Weil V. Guerin 391 Weiner v. Gill 39 Weiner v. Harris 524 Weinstock v. Marks 256 Weintz V. Hafner 459 Weirt). Bell 251 Weishut V. Lajrton 65 Welch V. Bunce 182 Welch V. Mandeville 362 Welch V. Mayer 367 Welch V. Sackett 24, 53 Wellington v. Kelly 295 Wells V. Alexandre 52, 123 Wells V. Caywood 194 Wells V. Foster 289 Wells V. Mayor of Kingston on HuU 90 Wells V. People 272 Wells V. Porter 546 Wells V. Seixas 180 Wells, Fargo & Co. v. Pacific Ins. Co 223 WeUston Coal Co. v. Franklin Paper Co 464 Welsh V. Huckestein 402 Wenninger v. Mitchell 316 Wentworth v. Day 149 Werner v. Tuch 495 West V. Camden 288 West V. O'Hara 97 West V. Penny 179 West of England Fire Ins. Co. v. Isaacs 283 Wester v. Casein Co. . . .440, 442, 444 Western Pub. House v. Dist. Tp. of Rock 512 Western Union Telegraph Co. v. Allen 249 Western Union Tel. Co. v. Norris 249 Western Union Tel. Co. ti. Semmes 447 Western Union Tel. Co. v. Shot- ter 205 Western Waggon Co. v. West . .366 Westervelt v. Demarest 248 Westman v. Krumweide 65, 397 Weston V. Hodgkins 502 West Yorkshire v. Coleridge 126 Wetherbee v. Potter 100 Wetkopsky v. N. H. Gas Co 100 Wetmore v. Bruce 423 Wettenhall v. Wood 278 Wetutzke v. Wetutzke 352 Wharton v. Winch 454 Wheat V. Cross 24, 39, 56, 213 Wheat V. Rice 341, 345 Wheeler, In re 195 Wheeler v. Garcia 451 Wheeler v. Glasgow 13 Wheeler v. Hawkins 272 Wheeler v. Klaholt 36, 39 PAGE Wheeler v. New Brunswick &c. R.479 Wheeler & Wilson Mfg. Co. v. Aughey 514 Wheelock v. Moulton 188 Wheelton v. Hardisty 240 Whelan v. Ansonia Clock Co 435 Whipple V. Barton 268 Whitbeck v. Van Ness 494 White V. Bigelow 99 White V. Bluett 129 White V. Cannon 327 White V. Corlies 3, 25, 28, 36, 51 White V. Franklin Bank 313 White V. Kuntz 284 White V. Madison 235, 527 White ». N. Y. &c. R 533 White V. Rintoul 97, 98 White V. Ross. 267 White Co., R. H. v. Remick 443 Whitehead v. Burgess 339 Whitehead v. Kennedy 268 Whiteley's Case 258 Whiteside v. North American Ace. Ins. Co 428 Whitley v. James 514 Whitmarsh v. Walker 100 Whitney v. Dutch 177, 178, 180 Whitney v. Merchants' Union Exp. Co 516 Whitney v. Wyman 513, 525 Whittaker, In re 248 Whittemore v. Judd &c. Co 390 Whittenton Mfg. Co. v. Staples. . 384 Whittingham v. Murdy 176 Whitwood Chemical Co. v. Hard- man 476 Whyddon's Case 84 Wiberly v. Matthews 292 Widiman v. Brown 136 Wigan V. Eng. &c. Life Assn.124, 130 Wigent V. Marrs 444 Wigglesworth v. Dallison 402 Wilcox V. Am. Tel. & Tel. Co. . .203 Wilcox V. Iowa Wesleyan Univ. .230 Wilcox V. Luco 164 Wild V. Harris 124 Wilkinson v. Byers 139 Wilkinson v. Coverdale 134 Wilkinson v. Johnson 490 Wilkinson v. OUveira 152 Wilkinson v. Stitt 66, 273 Wilkinson v. Tousley. . . . '. 276 Wilkinson v. Water Co 346 Wilkinson v. Wilkinson 191 Willard v. Wood 347 Willcox &c. Co. V. Ewing 518 WiUemin v. Dunn 264 Williams v. Agnis 470 WiUiams v. Bayley. . . .263, 289, 320 WiUiams v. Carrington 142 Williams v. Carwardine. . .29, 39, 67 Williams v. Fowle 351 Williams v. Green 84 TABLE OF CASES Ivii PJIQE Williams v. Ingersoll 368 WUliams v. Jones 545 Williams v. Jordan 103 Williams v. Lake 103 Williams v. Moor 156 Williams v. Railway 30 Williams v. Robb 227 Williams v. Sapieha 191 Williams v. SiUiman 169 Williams v. Sorrel 367 Williams v. West Chicago St. Ry 30, 39 Williams v. Whittell 89 Williams Mfg. Co. v. Standard Brass Co 426 Williamson v. Ry 259 Willoughby v. Willoughby 392 Willson V. Baltimore 472 Wilmington Trans. Co. v. O'Neil . 434 Wilson V. Calhoun 272 Wilson V. Carnley .286 Wilson V. Edmonds 150 Wilson V. Finch-Hatton 246 Wilson V. Glossop 510 Wilson V. Jones 275 Wilson V. King 164 Wilson V. Monticello 243 Wilson V. Powers 136 Wilson V. Thoresen 548 Wilson V. Tucker 396 Wilson V. Tumman 511, 512 Wilsons V. Tennants 429, 431 Wilton V. Eaton 133 Wimer v. Overseers 146 Winchester v. Howard 532 Windhill Local Board v. Vint. . .290 Windmuller v. Pope 442 Wing n. Chase 82 Wingw. MiU 153 Winn V. Bull 64 Winsor v. Lombard 211 Winter v. Kansas City Cable Ry . 87 Wisconsin & Mich. R.R. Co. v. Powers 124 Wiser v. Lawler 242 Withers v. Reynolds 455 Wolcott V. Mount 211, 223, 458, 460, 468 Wolff V. Koppel 98, 525 WoKord V. Powers 10, 121 Wolverhampton Railway Co. v. L. & N. W. Railway Co 474 Wood V. Abrey 264 Wood V. Boynton 209, 210, 212 Wood V. Erie Ry 272 Wood V. Faut 498 Wood V. Moriarty 341, 347, 399 Wood V. Orford 386 Wood V. Roeder 249 Wood V. Sheldon 217, 547 PAGE Wood V. Whitehead Bros 300 Wood & Co. V. Smith 426 Woodberry v. Warner 447 Woodbury v. Tampa Waterworks.346 Wood Mowing &c. Co. v. Gaert- ner 399 Woodruff V. Saul 229 Woods V. wader 287 Woodstock L-on Co. v. Richmond &c.Co 288,516 Woolf V. Hamilton 278 Woolfe V. Home 523 Wooten V. Walters 452 Worcester County Bank v. Dor- chester &c. Bank 205 Work V. Beach 412 Workman v. Wright 514 Wormack v. Rogers 264 WorraU v. Munn 83, 508 Worsley v. Wood 414 Worthington, Matter of 289 Worthington v. Beeman 61 Wright V. Carter 267 Wright V. Dannah 106 Wright V. Steele 178, 179 Wulschner v. Ward 488 Wyant v. Lesher 309 Wylieu.Ry 490 X Xenos V. Wickham 24, 83 Y Yates V. Lyon 167 Yeagley v. Webb 203 Year Book, 17 Edw. IV, 1 35 Yeoland's Consols, In re 176 Yonge V. Toynbee 528, 540, 542 Young V. Farwell 61 Yoimg V. Hunter 420 Young V. Leamington Corpora- tion 91 Young V. Leary 434 Young V. Muhling 186 Young V. RundaU 186 Young V. Stevens 191 Young V. Trainor 517 Z Zabriskie v.Uy 227, 458 Zabriskie a.Smith 295 Zaleski v. Clark 425 Zavelo V. Reeves 156 Zell's Appeal 341 Zimmer v. N. Y. Cent. &c. Ry . . . 32 Zinc Corp. v. Hirsch. . . 163, 287, 431 Zoebisch v. Van Minden 132 Zouch V. Parsons 177 Zuck V. McClure 445 Zwolanek v. Baker Mfg. Co 54 PART I INTRODUCTION CHAPTER I The Place of Contract in Jurisprudence I. Outline of the subject. At the outset of an inquiry into the principles of the law of contract it may be well to state the nature of the inquiry, its main purposes, and the order in which they arise for discussion. 1. Nahore of contract. First, therefore, we must ask what we mean by contract, and what is the relation of contract to other legal conceptions. 2. Formation of contract. Next we must ask how a contract is made; what things are needful to the formation of a valid con- tract. 3. Operation of contract. When a contract is made we ask whom it affects, or can be made to affect. This is the operation of contract. 4. Interpretation of contract. Then we inquire how the courts regard a contract in respect of the evidence which proves its ex- istence, or the construction placed on its terms. This we may call the interpretation of contract. 5. Discharge of contract. Last we come to the various modes by which the contractual tie is unfastened and the parties re- lieved from contractual liability. This is the discharge of con- tract.^ ^ The following analysis may be suggested, and is adhered to, in the main, in this edition: 1. Nature of contract : analysis and definition of terms and jural concepts. 2. Formation of contract : a discussion of the operative facts that induce organized society to create those legal relations defined as contractual. Such facts are offer, acceptance, consideration, delivery, etc. 3. Operation of contract : the legal relations of persons (including third persons) consequential upon the facts of formation and also upon subse- quent operative facts. These legal relations are to be discovered partly by interpretation ; they are determined also by subsequent facts, such as non-performance, impossibility, assignment, etc. This heading covers all the rules concerning performance and breach of contract. 2 INTRODUCTION [Chap. I THE NATURE OF CONTRACT 2. The object of law. The object of law is order, and the re- sult of order is that men can look ahead with some sort of secur- ity as to the future. Although human action cannot be reduced to the uniformities of nature, men have yet endeavored to re- produce, by law, something approaching to this uniformity. As the law relating to property had its origia in the attempt to in- sure that what a man has lawfully acquired he shall retain; so the law of contract is intended to insiure that what a man has been led to expect shall come to pass; that what has been prom- ised to him shall be performed. Such is the object of contract, and we have to analyze this conception, and ascertain and test the machinery by which men are constrained to keep faith with one another. 3. Contract is agreement resulting in obligation. Contract results from a combination of the two ideas of agreement and ob- ligation. This statement must be limited to its appUcation to a scientific system of jurisprudence in which rights have been an- alyzed and classified. The conception of obligation, as we under- stand it, was probably not clearly present to the minds of the judges who first enforced promises to do or to forbear; and we may be quite sure that they did not rest their decisions, as to the vahdity of such promises, upon agreement or the union of wills. But the analysis is none the less accmrate because it has not always been made or understood. 4. Discharge of contract : the operative facts that extinguish pre-existing contractual relations. Life is merely one fact after another; and a study of any branch of law involves the classification of these facts into those that are operative to create legal relations and those that are not, and the determination of legal relations that are consequent upon operative facts. The life history of a contract may be briefly indicated as follows: (1) Preliminary communi- cations (not operative). (2) Offer, an act operating to create (3) a legal power in the offeree (as well as some other relations). (4) Acceptance, an operative act creating (5) new legal relations of numerous and complex sorts called "contract" — also "primary obligation." (6) Facts subse- quent to formation but precedent to breach, some of which may be conditions precedent to the existence of (7) any duty of immediate per- formance and hence to a right of action for breach (e.g., tender, actual performance, continued life and health). (8) Breach, a fact operating to create new relations including (9) a duty to make reparation, often called "secondary obligation." (10) Facts discharging previous relations and re- establishing the status quo ante (so far, at least, as concerns the mere legal relations of the parties). See further the discussion at § 274a under the title "Operation of Contract." Chap. I] AGREEMENT 3 Contract is that form of agreement which directly contem- plates and creates an obligation; the contractual obligation is that form of obligation which springs from agreement. We should therefore try to get a clear idea of these two conceptions, and to this end Savigny's 1 analysis of them may well be consid- ered with reference to the rules of English Law." I will begin with his analysis of agreement. 1. Agreement 4. Requisites of agreement. 1. Two or more persons. Agree- ment requires for its existence at least two parties. There may be more than two, but inasmuch as agreement is the outcome of consenting minds the idea of plurality is essential to it.^ 2. Definite common intention. The parties must have a dis- tinct intention, and this must be common to both. Doubt or difference are incompatible with agreement. The proposition may be illustrated thus : Doubt: " Will you buy my horse if I am inclined to sell it? " " Very possibly." Difference: " Will you buy my horse for £50? " " I will give £20 for it." ' 3. Intention communicated. The parties must communicate to one another their common intention. Thus a mental assent to an offer cannot constitute an agreement.' * A writes to X a Savigny, System, § 140. 4. 6 See the dicta of Lord Blackburn in Brogden s. Metropolitan Railway Company, (1877) 2 App. Cas. 691. It appears from the records of the Proceedings in the House of Lords (Appeal Cases, 1877, vol. vn, pp. 98, 106) that Lord Coleridge, C.J., and Brett, J., had in giving judgment in the Common Pleas used language suggesting that an uncommunicated mental consent might create a binding agreement. Lords Selborne and Blackburn express their dissent from such a proposition, the latter very fully and decidedly. ^ A German jurist (177&-1861), many of whose books have been trans- lated into English. ' "It is a first principle, that in whatever different capacities a person may act, he can never contract with himself, nor maintain an action against himself. He can in no form be both obligor and obligee." Morton, J., in Eastman v. Wright, (1828, Mass.) 6 Pick. 316; Gorham's Adm'r v. Meacham's Adm'r, (1891) 63 Vt. 231. * It is perhaps better to say that there must be a definite common expression of intention; for if two parties agree in expression, they may be held bound by contract even though they differed materially in actual mental understanding. * "A mental determination not indicated by speech, or put in course of indication by act to the other party, is not an acceptance which will bind the other. Nor does an 'act, which, in itself, is no indication of an acceptance, become such, because accompanied by an unevinced mental determination." Folger, J., in White v. Corhes, (1871) 46 N.Y. 467. It has indeed been held that there must be some overt act of acceptance; but the law does not require that knowledge of this act shall always reach the offeror. See § 33. 4 INTRODUCTION [Chap. I and offers to buy X's horse for £50. X makes up his mind to accept, but never tells A of his intention to do so. He cannot complain if A buys a horse elsewhere. 4. Contemplating legal relations. The intention of the parties must refer to legal relations: it must contemplate the assump- tion of legal rights and duties as opposed to engagements of a social character. It is not easy to prescribe a test which shall distinguish these two sorts of engagements, for an agreement may be reducible to a pecuniary value and yet remain outside the sphere of legal relations. The Courts must decide such mat- ters, looking at the conduct of the parties and all the circum- stances of the case, and applying their own knowledge of human affairs.' 5. Affecting the agreeing parties. The consequences of agree- ment must affect the parties themselves.^ Otherwise, the ver- dict of a jury or the decision of a court sitting in banco would satisfy the foregoing requisites of agreement.^ Agreement then is the expression by two or more persons of a common intention to affect their legal relations. 5. Agreement a wider term than contract. But agreement as thus defined by Savigny has a wider meaning, and includes trans- actions of other kinds than contract as we commonly use the term. 1. Agreements not creating obligations. There are agreements the effect of which is concluded so soon as the parties thereto have expressed their common consent in such manner as the law requires. Such are conveyances and gifts," wherein the a Ab to gift, see Hill 8. Wilson, (1873) L.R. 8 Ch. 888. > KeUer v. Holderman, (1863) 11 Mich. 248; McClurg v. Terry, (1870) 21 N.J. Eq. 225. If the conduct and expressions of one party lead the other reasonably to believe that a contract is being offered and to assent to such a contract, a contractual obligation is formed irrespective of the actual but secret intention of the one whose conduct so misleads. 2 But in the United States generally a contract may be made by A and B for the benefit of C, who may maintain an action upon it. See Chapter IX, post. It is not possible, however, for A and B by contract to impose duties upon C, unless one of them is C's authorized agent. Chapter VIII, post. Furthermore, it is possible for A to undertake with B that C shall thereafter conduct himself in a particular manner. This puts no legal duty upon C; but if C does not conduct himself in the particular manner, A has committed a breach of contract. ' A judgment of a court is treated as a quasi-contract, but is not of course the result of an agreement. O'Brien v. Young, (1884) 95 N.Y. 428; Morley v. Lake Shore Ry., (1892) 146 U.S. 162. See for agreement among members of a committee not affecting the party claiming under the agreement, Benton ti. Springfield &c. Ass'n, (1898) 170 Mass. 534. Chap. I] AGREEMENT 5 agreement of the parties effects at once a transfer of rights in rem, and leaves no obligation subsisting between them.i 2. Agreements creating status or contingent obligations. There are agreements which effect their purpose immediately upon the expression of intention; but which differ from simple con- veyance and gift in creating further outstanding obligations be- tween the parties, and sometimes in providing for the coining into existence of other obligations, and those not between the original parties to the agreement. Marriage, for instance, effects a change of status directly the consent of the parties is expressed before a competent authority; at the same time it creates obligations between the parties which are incidental to the transaction and to the immediate objects of their expression of consent." ^ So too a settlement of property in trust, for persons bom and imborn, effects much more than the mere conveyance of a legal estate to the trustee; it imposes on him incidental obligations some of which may not come into existence for a long time; it creates possibilities of obligation between him and persons who o Moss v. Moss, [1897] P. at p. 267. ^ This distinction may be expressed as follows: A conveyance, whether by gift or for compensation, creates rights in rem and their corresponding duties. These rights and duties are not restricted to the contracting parties alone, but extend to all persons subject to law. Such rights and duties are therefore not contractual, because they exist otherwise than by consent. If an expression of assent creates only such rights and duties, it should be called conveyance or grant and not contract. An expression of assent may, however, confer upon one a right in personam, with a corresponding duty resting upon the other party alone; this is contractual. See Hohfeld, "Some Fundamental Legal Conceptions as Applied in Judicial Reasoning," 23 Yale Law Journal, 16, 26 id. 710; Corbin, "Offer and Acceptance and Some of the Resulting Legal Relations," 26 Yale Law Journal, 169. ' Marriage is very generally declared by American statutes to be a "civil contract." It arises from expressions of mutual consent, in accord- ance with formalities prescribed by law. The ceremony creates a multitude of legal relations between the two parties, and between them and third persons, many of which they did not foresee or intend. The same is true of many business contracts, the difference being one of degree. Other differences are as follows: the age of consent is generally below the age of 21; the parties have no power of rescission; the provision in the Federal Constitution forbidding any state to impair the obligation of a contract does not forbid legislative divorces; statutes generally prescribe a public ceremony although they are often held to be directory only; the power to avoid for fraud is much more limited. See Hulett v. Carey, (1896) 66 Minn. 327; Moss v. Moss, [1897] P.D. 263; Di Lorenzo v. Di Lorenzo, (1903) 174 N.Y. 467; Lyman v. Lyman, (1916) 90 Conn. 399. 6 INTRODUCTION [Chap. I are not yet in existence. These obligations are the result of agreement. Yet they are not contract. ^ 3. Agreements not conforming to local law. Savigny's defini- tion would include agreements which, though intended to affect legal relations, fail to do so because they fail to satisfy some re- quirement of the law of the country in which they are made,'' or become the subject of litigation. 6. Characteristics of contract. It remains to ascertain the characteristics of contract as distinguished from the forms of agreement just described. . 1. A promise essential. An essential feature of contract is a promise by one party to another, or by two parties to one an- other, to do or forbear from doing certain specified acts. By a promise we mean an accepted offer as opposed to an offer of a promise, or, as Austin called it, a pollicitation.^ 2. Originates in an offer. An offer must be distinguished from a statement of intention; for an offer imports a willingness to be bound to the party to whom it is made. Thus, if A says to Z " I mean to sell one of my sheep if I can get £5 for it," there is a mere statement which does not admit of being turned into an agreement: but if A says to X " I will sell you whichever of my sheep you like to take for £5," we have an offer.* 3. An accepted offer creates a promise. A promise, again, must be distinguished from an offer. An offer becomes a promise by 1 Oaman ». McArdle, (1885) 99 N.Y. 451; Ahrens v. Jones, (1902) 169 N.Y. 555. As in the case of marriage, the difference is one of degree rather than of kind, such difference being considerably less. A conveyance in trust, ac- cepted by the trustee appears to constitute what is elsewhere described as a unilatercd contract. The fact that the court of equity was the court that &st recognized and enforced the resulting legal relations and did this in favor of a third party beneficiary is no reason for refusing to use the word " contract." See §§ 277, 285, Contracts for the Benefit of Third Persons. 2 Union Nat. Bk. v. Chapman, (1902) 169 N.Y. 538; Pritchard v. Norton, (1882) 106 U.S. 124; Scuddertr. Bank, (1875) 91 U.S. 406. It should be observed that acts of offer and acceptance may operate to create legal relations in one jurisdiction even though they do not in another jurisdiction. However, this is not the place to discuss complex questions in the confiict of laws. See Union Trust Co. v. Grosman, (1917) 38 Sup. Ct. 147, and comment thereon in 27 Yale Law Journal, 816. ' This distinction is of doubtful value. By common usage, a promise is an expression leading another person justifiably to expect certain conduct on the part of the promisor. Such an expression is a promise, whether en- forceable at law or not. It is indeed an essential element in every contract. Society does not guarantee the fulfillment of all expectations so induced. See also § 48, infra. * See § 64, sub-s. 4, post, "Invitations to treat." Chap. I] AGREEMENT 7 acceptance: until acceptance it may be withdrawn, after accep- tance its character is changed. If A says to Z " I will sell you my horse for £50," and X says " Agreed," there is a promise by A to sell, a promise by X to buy, and a contract between the two.^ 4. The law must attach an obligation to the promise. To make that sort of agreement which results in contract, there must be (1) an offer, (2) an acceptance of the offer, resulting in a promise," and (3) the law must attach a binding force to the promise, so as to invest it with the character of an obliga- tion. Or we may say that such an agreement consists in an expression of intention by one of two parties, of expectation by the other, wherein the law requires that the intention should be carried out according to the terms of its expression and the expectation thereby fulfilled.* a It will be shown later that an offer may be of an aot. and that the promiae resultizig from acceptance may be made by the acceptor. b Dr. Holland's view (Jurisprudence, ed. 11, p. 258) is that the law does not require contracting parties to have a common intention but only to seem to have one, that the law "must needs regard not the will itself, but the will as expressed." Our difference may be shortly stated. He holds that the law does not ask for "a union of wills " but only for the phenomena of such a union. I hold that the law does require the wills of the parties to be at one, but that when men present all the phenomena of agreement they are not allowed to say that they were not agreed.* For all practical purposes our conflict of view is imma- terial. But, after all, it is the intention of the parties which the courts endeavor to ascertain; and it is their intention to agree which is regarded as a necessary inference from words or conduct of a certain sort. See per Lord Watson in Stewart v. Kennedy, 13 App, Cas. 108, at p. 123: "The appellant contracted, as every person does who becomes a party to a written contract, to be bound in case of dispute by the interpretaton which a Court of Law may put upon the language of the instrument. The result of admitting any other principle would be that no contract in writing coidd be obligatory if the parties honestly attached in their own minds different meanings to any material stipulation." * The present editor agrees with Dr. Holland. It is the exjn-ession of intention that is the operative act that creates the legal relations called obligation. It will be admitted that such expressions may not accurately represent the mental intent. To exclude all other evidence of such intent is to hold in fact that the intent is immaterial. It may be said that the purpose of the rule is to carry out the intentions of the parties actually existing in the great majority of cases; but it seems better to say that its purpose is to secure the fulfillment of the promisee's reasonable expecta- tions as induced by the promisor's conduct. See post, § 31, note; also § 178. " The law imputes to a person an intention corresponding to the reasonable meaning of his words and actions." Leake, Contracts (6th ed.), p. 3. In Becker v. London Assur. Ciorp., (1918, H. of L.) 117 L.T. 609, construing an insurance contract, Lord Sumner said: "I daresay few assured have any distinct view of their own on the point, and might not even see it, if it were explained to them, but what they intend contractually does not depend on what they understand individually." ' The author's illustration is doubtless correct, but this is because the words used by A are an elliptical form of expression for "I promise to sell you my horse in return for your promise to pay me £50 on delivery." Had A offered his promise to sell the horse in return for £50 cash, X coiild accept only by delivering the money and not by saying "agreed." 8 INTRODUCTION [Chap, I Contract then differs from other forms of agreement in having for its object the creation of an obligation between the parties to the agreement. 2. Obligation 7. Nature of obligation. Obligation is a legal bond whereby constraint is laid upon a person or group of persons to act or forbear on behalf of another person or group." ^ Its characteristics seem to be these. 1. A control. It consists in a control exerciseable by one or both of two persons or groups over the conduct of the other. They are thus bound to one another, by a tie which the Roman lawyers called vinculum juris, which lasts, or should last, until the objects of the control are satisfied, when their fulfillment effects a solvMo obligationis, an unfastening of the legal bond. That this imfastening may take place in other ways than by fulfillment will be shown hereafter.* 2. Two definite parties. Such a relation as has been described necessitates two parties, and these must be definite. There must be two, for a man cannot be under an obligation to himself, or even to himself in conjunction with others. Where a man borrowed money from a fund in which he and others were jointly interested, and covenanted to repay the money to the joint account, it was held that he could not be sued upon his covenant. " The covenant to my mind is senseless," said Pollock, C.B. " I do not know what is meant in point of law by a man paying himself." " ^ a Savigny, Obi. ch. i. ss. 2-4. 5 Infra, Part IV. c Faulkner i. Lowe, (1848) 2 Ex. 595, and see Hoyle v. Hoyle, [1893] 1 Ch. (Cji..) 99. ' It is indeed hard to avoid the use of figurative language like this, and for merely literary purposes it is not desirable to avoid it. Nevertheless, an obligation is neither a rope nor a chain. After certain operative facts, called ofifer and acceptance, occur, they are followed by a group of legal relations. The term "obligation" is a term that is loosely used to refer to this group. The most important of these relations are the legal correla- tives called right and duty. These legal relations are merely mental concepts of what organized society vnU do as a result of the facts of offer and accept- ance and of subsequent facts. These concepts enable us to predict societal action and thus avoid trouble or gain advantage. Where one has a right and another owes a duty, we can foresee the sheriff. This is the "control " of which the author speaks. 2 Gorham's Adm'r w. Meacham's Adm'r, (1891) 63 Vt. 231; Eastman V. Wright, (1828, Mass.) 6 Pick. 316. There would be nothing unreasonable in holding that such an agreement creates legal relations between the one and the others, even though one can- not have a legal duty to himself. Chap. I] OBLIGATION 9 And the persons must be definite. A man cannot be obliged or bound to the entire community: his duties to the poUtical society of which he is a member are matter of public, or crim- inal law. Nor can the whole community be under an oUiga- tion to him: ^ the rights on his part correlative to the duties owed to him would be rights in rem, would be in the nature of property as opposed to obligation. The word obligation has been imfortunately used in this sense by Austin and Bentham as including the general duty, which the law imposes on all, to respect such rights as the law sanctions. Whether the rights are to personal freedom or security, to character, or to those more material objects which we commonly call property, they impose corresponding duties on all to forbear from molesting the right. Such rights are rights in rem. But it is of the essence of obligation that the duties which it imposes are imposed on definite persons, and are themselves definite: the rights which it creates are rights in personam.'' 3. Definite duties. The liabilities ' of obligation relate to 1 A "whole community" in the sense of an organized political unit can be under an obligation to an individual, enforceable by the machinery and power of a larger poUtical organization. Even if there be no such larger organization, the transaction is identical in form and is intended to have the same legal results. For example, a county may contract with an individual for the repair of a road, and the county will be under an obUgation to pay. The individual's duty to repair is a con- tractual duty, and his failure to perform it is not a tort. So also, the United States may contract with an individual for the erection of a build- ing; no one hesitates to call the existing relations a contract, and \mder normal conditions it will have exactly the same effects as if both parties were subject to a higher power. The individual is in such case bound in exactly the same way as he would be in the case of a contract with another individual; but his claim against the government will fail of fulfillment in case of repudiation. These relations, even though defective, are never- theless to be classified among contracts and not under the heading of torts, of criminal law, or of property. ' For an accurate analysis of legal relations in general, and for an illu- minating discussion of the terms " rights in rem " and "rights in personam," see Professor W. N. Hohfeld, "Fundamental Legal Conceptions as Applied in Judicial Reasoning," 23 Yale Law Journal, 16, and 26 id. 710. ' The term "hability" is one of at least double signification. In one sense it is the synonym of duty, the correlative of right; in this sense it is the opposite of privilege or liberty. If a duty rests upon a party, society is rum commanding performance by him and threatening penalties. In a second sense, the term "liability" is the correlative of power and the opposite of immunity. In this case society is not yet commanding performance, but it will so command if the possessor of the power does some operative act. If one has a power, the other has a liability. It would be wise to adopt the second sense exclusively. Accurate legal thinking is diflacult when the fundamental terms have shifting senses. 10 INTRODUCTION [Chap. I definite acts or forbearances. The freedom of the person bound is limited only in reference to some particular act or series or class of acts. A general control over the conduct of another would affect his status as a free man, but obligation, as was said by Savigny, is to individual freedom what serviius is to dominium. One may work out the illustration thus: I am owner of a field; my proprietary rights are general and indefinite; my neighbor has a right of way over my field; my rights are to that extent curtailed by his, but his rights are very definite and special. So with obligation. My indi- vidual freedom is generally unlimited and indefinite. As with my field so with myself, I may do what I like with it so long as I do not infringe the rights of others. But if I contract to do work for A by a certain time and for a fixed reward, my general freedom is abridged by the special right of A to the performance by me of the stipulated work, and he too is in like manner obliged to receive the work and pay the reward. 4. Reducible to a money value. The matter of the obligation, the thing to be done or forborne, must possess, at least in the eye of the law, a pecimiary value, otherwise it would be hard to distinguish legal from moral and social relations. Gratitude for a past kindness cannot be measured by any standard of value, nor can the annoyance or disappointment caused by the breach of a social engagement; and courts of law can only deal with matters to which the parties have attached an importance estimable by the standard of value current in the country in which they are. ' Obligation then is a control exerciseable by definite persons over definite persons for the purpose of definite acts or for- bearances reducible to a money value. ^ 8. Sources of obligation. We may note here the various sources of obligation. 1. Agreement. Obhgation may arise from agreement. Here we find that form of agreement which constitutes contract. An offer is made by one, accepted by another, so that the ' The parties may fix a pecuniary value to the doing or forbearing of an act which would otherwise not be reducible to a pecuniary standard; as the forbearing of a personal habit, Hamer v. Sidway, (1891) 124 N.Y. 538; the naming of a child, WoHord v. Powers, (1882) 85 Ind. 294; Gardner v. Denison, (1914) 217 Mass. 492; or the maJdng of an affidavit, Brooks v. Ball, (1820, N.Y.) 18 Johns. 337. ' For the meaning of obligation as used in the Constitution of the United States (Art. 1, sec. 10) see Sturges v. Crowninshield, (1819, U.S.) 4 Wheat. 122; Walker v. Whitehead, (1872, U.S.) 16 WaU. 314; Robinson v. Magee, (1858) 9 Cal. 81. Chap. I] OBLIGATION 11 same thing is, by mutual consent, intended by the one and expected by the other; and the result of this agreement is a legal tie binding the parties to one another in respect of some future acts or forbearances. 2. Tort. Obligation may arise from delict, or, as English law calls it, from tort. This occurs where a primary right to for- bearance has been violated; where for instance, a right to property, to security, or to character has been violated by trespass, assault, or defamation. The wrong-doer is bound to the injured party to make good his breach of duty in such manner as is required by law. Such an obligation is not created by the free-will of the parties, but springs up immediately on the occurrence of the wrongful act." * 3. Breach of con^ad. Obligation may arise from breach of contract. While A is under promise to X, X has a right against A to the performance of his promise when performance be- comes due, and to the maintenance up to that time of the con- tractual relation. But if A breaks his promise, the right of X to performance has been violated, and, even if the contract is not discharged, a new obligation springs up, a right of action, precisely similar in kind to that which arises upon a delict or breach of a general duty. 4. Judgment. Obligation may arise from the judgment of a court of competent jurisdiction ordering something to be done a In an earlier edition (ed. 2, pp. 9-13) I diaoussed the views of Mr. Justice Holmes as to the nature of the contractual obligation, and of Dr. Holland as to its source : but these topics are better suited to a treatise on Jurisprudence than to an elementary book on the law of contract, and they are now omitted from the text. Mr. Justice Holmes (Common Law, p. 300) regards a contract as "the taking of a risk." He rigorously insists that a man must be held to contemplate the ultimate legal consequences of his conduct, and, in making a promise, to have in view not its performance but the pay- ment of damages for its breach. I cannot think it desirable to push legal analysis so far as to disregard altogether the aspect in which men view their btisiness transactions, and to treat contract as a wager in which performance is backed against damages. For Dr. Holland's view, see ante, § 6, note. 1 Tort and breach of contract are alike breaches of duty, but in the case of tort the pre-existing duty of the wrong-doer was one that was shared by every other member of society; and the injured party whose right was violated had not merely one right, he had a multitude of rights. His rights and the correlative duties of others were "multital." The secondary right and duty, however, arising from the tort, are relations that exist between the two persons only. They are "unital." See Hohfeld, loc. cit. supra. la the case of a breach of contract, both the primary right and duty and the secondary right and duty are "unital." Observe that this new secondary "obligation" is not a mere "right of action." It too is a group of legal relations, including rights and duties, privileges and no-rights, powers and liabilities, immunities and disabilities. It is sometimes difficult to determine whether the obhgation arises from tort or breach of contract. See Rich v. New York Central &c. R., (1882) 87 N.Y. 382; Freeman v. Boland, (1882; 14 R.I. 39. 12 INTRODUCTION [Chap. I or forborne by one of two parties in respect of the other. It is an obligation of this character which is unfortunately styled a contract of record in English law. The phrase is unfortunate because it suggests that the obligation springs from agreement, whereas it is really imposed upon the parties ab extra. ' 5. Quasi-contract. Obligation may arise from quasi-con- tract. This is a convenient term for a multifarious class of legal relations which possess this common feature, that without agreement, and without delict or breach of duty on either side, A has been compelled to pay or provide something for which X ought to have paid or made provision, or X has re- ceived something which A ought to receive. The law in such cases imposes a duty upon X to make good to A the advan- tage to which A is entitled; and in some cases of this sort, which will be dealt with later, the practice of pleading in English law has assumed a promise by X to il and so invested the relation with the semblance of contract.'' 6. Annexed by law as incidental to agreement. Lastly, obli- gation may spring from agreement and yet be distinguishable from contract. Of this sort are the obligations incidental to such legal transactions as marriage or the creation of a trust.' It is no doubt possible that contractual obligations may arise incidentally to an agreement which has for its direct object the transfer of property. In the case of a conveyance ' A judgment is not a contract, within the provisions of the Federal constitution prohibiting state legislation impairing the obligation of con- tracts. Morley v. Lake Shore Ry., (1892) 146 U.S. 162; O'Brien v. Young, (1884) 95 N.Y. 428. But a judgment on a contract is protected in the same maimer as the contract itself. Fisk v. Police Jury, (1885) 116 U.S. 131 ; Getto V. Friend, (1891) 46 Kans. 24. ' "There is a class of cases where the law prescribes the rights and Uabili- ties of persons who have not in reality entered into any contract at all with one another, but between whom circumstances have arisen which make it just that one should have a right, and the other should be subject to a liability, similar to the rights and Uabihties in certain cases of express contracts. Thus if one man has obtained money from another, through the medium of oppression, imposition, extortion, or deceit, or by the commis- sion of a trespass, such money may be recovered back, for the law imphes"a promise from the wrong-doer to restore it to the rightful owner, although it is obvious that this is the very opposite of his intention." — People V. Speir, (1879) 77 N.Y. 144, 150. See also Hertzog v. Hertzog, (1857) 29 Pa. 465; Columbus &c. Ry. v. Gaffney, (1901) 65 Oh. St. 104. And see Woodward on Quasi-Contracts; Keener on Quasi-Contracts; Corbin, "Quasi-Contractual Obligations," 21 Yak Law Journal, 533. ' Maynard v. Hill, (1887) 125 U.S. 190, 210-214; Benjamin v. Dock- ham, (1883) 134 Mass. 418; Platner v. Patchin, (1865) 19 Wis. 333 (obliga- tions arising from marriage). Hamer v. Sidway, (1891) 124 N.Y. 538 (obligation arising from trust). Cf. § 5, and notes. Chap. I] OBLIGATION 13 of land with covenants annexed, or the sale of a chattel with a warranty, the obligation hangs loosely to the conveyance or sale and is so easily distinguishable that one may deal with it as a contract. In cases of trust or marriage the agreement is far-reaching in its objects, and the obligations incidental to it are either contingent or at any rate remote from its main purpose or immediate operation. ^ In order, then, to keep clear of other forms of agreement which may result in obligation, we should bear in mind that to create an obligation is the one object which the parties have in view when they enter into that form of agreement which is called contrad. 3. Contract Q. Definition of contract. And so we are now in a position to attempt a definition of contract, or the result of the con- currence of agreement and obligation: and we may say that it is an agreement enforceable at law, made between two or more persons, by which rights are acquired by one or more to acts or forbearances on the part of the other or others.'^ 1 See ante, § 5, note. ' "It may be defined to be a transaction between two or more persons, in which each party comes under an obligation to the other, and each reciprocally acquires a right to whatever is promised by the other." Mr. Justice Washington in Dartmouth College v. Woodward, (1819, U.S.) 4 Wheat. 518, 656. For various definitions collected and discussed see Justice V. Lang, (1870) 42 N.Y. 493; and see Wheeler v. Glasgow, (1892) 97 Ala. 700. The term contract has been used indifferently to refer to three different things: (1) the series of operative acts by the parties resulting in new legal relations; (2) the physical document executed by the parties as the lasting evidence of their having performed the necessary operative acts and also as an operative fact in itself; (3) the legal relations resulting from the oper- ative acts, consisting of a right or rights in personam and their correspond- ing duties, accompanied by certain powers, privileges, and immunities. The sum of these legal relations is often called "obligation." The present editor prefers to define contract in sense (3) as the sum- total of those legal relations between persons arising from voluntary ex- pressions of intention and agreement, and including at least one primary right in personam with its corresponding duty. It is not at all necessary that the exact character and content of the resulting legal relations should have been foreseen and intended by the parties. PART II THE FORMATION OF CONTRACT CHAPTER II 10. Elements necessary to a valid contract. We have now to ascertain how contracts are made. A part of the definition of contract is that it is an agreement enforceable at law : it follows therefore that we must try to analyze the elements of a contract such as the law of England will hold to be binding between the parties to it. We look in the first instance for: 1. A distinct communication by the parties to one another of their intention; in other words, offer and acceptance. 2. The presence of certain evidence, required by law, of the intention of the parties to affect their legal relations. This evidence is either (o) form, or (6) consideration. If these two requisites are satisfied we have a contract which, prima facie, will hold, or at any rate we have the outward appearance of a contract; and yet some necessary elements of validity may be wanting. Such are: — 3. The capacity of the parties to make a valid contract. 4. The genuineness of the consent expressed in offer and acceptance. * 5. The legality of the objects which the contract proposes to effect. 11. Results of their absence. Where all these elements co- exist, there is a valid contract: where one is absent the con- tra,ct may be unenforceable, that is, valid but incapable of proof: or voidable, that is, capable of being aflBrmed or rejected at the option of one of the parties: or the transaction may be void, that is, destitute of legal effect, so that there is no con- tract in existence at all. It is, no doubt, technically inaccurate to say that the contract is void, when we mean that there is no contract,^ but it is a convenient form of expression. 1 But see note, § 176. ' ^ But it would not be at all inaccurate to say that the acts of the parties are totally inoperative and void so far as concerns contractual relations. See post, §§ 16-20. Chap. II] PROCEDURE 15 I. PROCEDURE 12. Importance of procedure. It may be useful to the stu- dent at this point, and before considering in detail the various elements of validity in contract, to take note of some rules of procedure, and some features of terminology which if not understood and kept in view may cause him difficulty and confusion of mind. In working out the law of contract mainly with the aid of decided cases it is important to know so much of procedure as will inform us what it is that the parties are asking or resist- ing. Under the same conditions of fact a suitor may succeed if he asks for the remedy appropriate to his case, or fail if he seeks one that is not appropriate. 13. Possible remedies in contract. A plaiatiff in an action on a contract may ask for one of five things: Damages, or compensation for the non-performance of a contract: ' Specific performance, or an order that a contract should be carried into effect by the defendant according to its terms: ^ Injunction, or the restraint of an actual or contemplated breach of contract: ^ Cancellation, or the setting aside of a contract: Redifi/yation, or the alteration of the terms of a contract so as to express the true intention of the parties." The first of these is the remedy formerly given in the Com- mon-Law Courts; the other remedies could only be obtained in the Court of Chancery as administering Equity. The Chancery did not give damages,* but directed that certain things should be done or forborne, whereby the rights of the a A plaintiff may also ask for a Declaration from the Court as to the true terms of a con- tract or his rights under it. But this can scarcely be described as a "remedy." Soci6t6 Mari- time I). Venus Co., (1904) 9 Com. Cas. 289. [See Professor E. M. Borchard, " The De- claratory Judgment," (1918) 28 Yale Law Journal, 1.] 6 The power of giving damages, conferred on the Chancery Courts in 1858 (21 & 22 Vict. 0. 27), was rarely used. 1 See §§ 401-408, post. The common-law remedy for breach of con- tract was a money judgment. The amount is generally called damages. There are some distmctioni however, among the common-law remedies in the actions of covenant, debt, and assumpsit. Debt is often as truly an action for specific reparation as is a bill in equity. 2 The equitable remedy of specific performance takes two forms: first, the specific enforcement of an aflSrmative promise (" I will convey lot No. 1 to you"); second the specific enforcement of a negative promise ("I win not carry on any business enterprise on my adjoining lot No. 2"). The first is enforced by a mandatory decree and the second by a prohibitive decree. See §§ 408, 409, post. 16 THE FORMATION OF CONTEACT [Chap. II parties were adjusted. The Judicature Acts now enable the High Court of Justice, the Court of Appeal, and every judge of those courts, to give effect to all equitable, as well as to all legal rights and remedies." ' 14. Common-law remedy. Nevertheless the remedy for- merly given by the Common-Law Courts only is not only different in kind from the remedies formerly given in the Court of Chancery, but is administered on different principles. If A has made a valid contract with B, he is entitled as of right to damages from B ii B breaks the contract — the measure of damages is a topic to be dealt with hereafter — but it does not follow that he will get a decree for the specific performance of the contract, or an injunction to restrain B from doing such a 36 & 37 Viot. c. 66, a. 24. ' Six American states (Alabama, Delaware, Mississippi, New Jersey, Tennessee, Vermont) still retain separate courts of equity and preserve with slight modifications the forms of pleading and practice peculiar to such courts. Eleven states (Florida, Illinois, Maine, Maryland, Massachusetts, Michigan, New Hampshire, Pennsylvania, Rhode Island, Virginia, West Virginia), the District of Colimibia and the United States imite both com- mon law and equity jurisdiction in the same court, but retain a separate form of pleading and practice for equity cases. In all the other states the same court administers both law and equity, and the pleading and practice is the same for both classes of cases. (Louisiana, whose jurisprudence is derived from the civil law, requires a judge, where the positive law is silent, to proceed according to natural justice and reason or received usage.) Common-Law Procedure. The common-law forms of action ex con- tractu were: (1) covenant, an action brought to recover damages for the breach of a contract under seal; (2) debt, an action brought to recover a specific sum of money due and owing from one person to another ; this action was long restricted to the enforcement of imilateral contracts, the receipt of a guid pro quo by the defendant being necessary to the creation of a "debt "; (3) assumpsit, an action brought to recover damages for the breach of any contract not under seal. The actions of debt and assumpsit came, for historical reasons, to be used interchangeably in certain cases. [See Slade's Case, (1602) 4 Coke, 92b.] When assumpsit is used for the collection of a "debt," it is often called indebitatus assumpsit; this includes the so-called "common counts" for goods sold, for work and labor done, for money lent, etc. Both debt and indebitatus assumpsit have been used for the enforcement of non-contract debts as well as for debts arising by agreement. The common-law procedure with some statutory modifications is in force in Delaware, Florida, Illinois, Maine, Michigan, New Hampshire, New Jersey, Pennsylvania, Rhode Island, Vermont, Virginia, West Vir- ginia and the District of Columbia. Practice Acts more substantially changing the common-law procedure and approaching the reformed code procedure are in force in Alabama, Georgia, Maryland, Massachusetts, Mississippi, Tennessee, and Texas. In all the other states a code of pro- cedure is in force which provides for a single form of action for all cases both at law and in equity. In the Federal courts the pleading in common- law actions conforms to that in force in the state in which the action is brought. The code procedure in Louisiana is founded on the civil law. Chap. II] PROCEDURE 17 acts as would amount to its violation. An equitable remedy can never be claimed as of right. ^ IS. Equitable remedies. Equitable remedies are limited partly by their nature, partly by the principles under which they have always been administered in the Chancery. The remedy by specific performance is necessarily limited in apphcation to cases in which a court can enforce its direc- tions. Engagements for personal service illustrate the class of cases in which it would be neither possible nor desirable for a court to compel parties to a performance of their contract; " and where the contract is such that a court will not grant a decree for specific performance it will not, as a rule, grant an injunction restraining from breach. ^ The principle on which equitable remedies are given imposes a further limit to their application. Their history shows that they are special interventions of the king's grace, where the common-law courts are unable to do complete justice. They are therefore supplemental and discretionary; they cannot be claimed as of right. The suitor must show that he cannot obtain otherwise a remedy appropriate to his case, and also that he is a worthy recipient of the favor which he seeks. Hence we find that where damages afford an adequate remedy equity will not intervene, a rule which is constantly exemplified in cases where specific performance is asked for, and the suitor is told that damages will give him all the com- pensation which he needs.* And again we find that the appli- cation of equitable remedies is affected by the maxim, " he who seeks equity must do equity." One who asks to have his contract canceled or rectified, on the ground that he has been the victim of mistake, fraud, or sharp practice (which is not technically the same as fraud), must show that his deal- ings throughout the transaction have been straightforward in every respect.^ a Jn/ra, §§ 408, 409. 1 Whatever this may have meant in earlier times, at present it means only that certain facts will have an operative effect in equity that the com- mon-law courts disregarded. If the required operative facts exist, the "right" in equity is just as certain as are rights at law. 2 See Cort v. Lassard, (1889) IS Ore. 221; Wakeham v. Barker, (1889) 82 Cal. 46; Rogers Co. v. Rogers, (1890) 58 Conn. 356; Lmnley v. Wagner, (1852) 1 DeG. M. & G. 604. » See Adams v. Messinger, (1888) 147 Mass. 185. ' * Goodenow v. Curtis, (1876) 33 Mich. 505; The Clandeboye, (1896) 70 Fed. 631. 18 THE FORMATION OF CONTRACT [Chap. II This rule applies to all equitable remedies, and should not be forgotten by the student. He will do well to inform him- self, at the outset of a case, of the remedies which the parties seek; for a party to a suit may lose his case, not because he has no claim of right, but because he has sought the wrong remedy. II. TERMINOLOGY i6. Void, voidable and unenforceable contracts. There are certain terms to which the attention of the student must be called, because they are of constant use in the law of contract, because they are not infrequently used with insufficient pre- cision, and because they signify very real differences in the existing legal relations. The terms are void, voidable, and unenforceable. A void contract is one which is destitute of legal effect. Strictly speaking, " void contract " is a contradiction in terms; for the words describe a state of things in which, despite the intention of the parties, no contract has been made. Yet the expression, however faulty, is a compendious way of putting a case in which there has been the outward semblance with- out the reality of contract. ^ A voidable contract is one which one of the parties may aflSrm or reject at his option. An uneiiforceable contract is one which is good in substance, though, by reason of some technical defect, one or both of the parties cannot sue upon it. Such a contract is sometimes called an agreement of imperfect obligation. 17. Void contracts. A void contract may be void on the face of it, or proof may be required to show that it is void. Where offer and acceptance do not correspond in terms, ^ or where there is an agreement to commit a crime,' the transaction is plainly void. Where a contract is made imder certain condi- tions of mistake,* or where an infant makes a promise which Parliament has declared, in the case of infancy, to be void, it is necessary to prove in the one case the fact of mistake, in the other the fact of infancy.^ In default of such proof, such ^ That is, there have been acts of offer and acceptance but no resulting contractual relations. 2 Rovegno v. Defferari, (1871) 40 Cal. 459. » Mateme v. Horwitz, (1886) 101 N.Y. 469. < Walker v. Ebert, (1871) 29 Wis. 194. » Trueblood v. Trueblood, (1856) 8 Ind. 195; Slater Woollen Co. v. Lamb, (1887) 143 Mass. 420. Chap. II] TERMINOLOGY 19 a transaction, good upon the face of it, and not shown to possess any legal flaw, would be enforced by the courts. But this does not alter the nature of the transaction, as will be seen when we compare that which is void, and that which is voidable. i8. Voidable contracts. When a contract is shown to be void it can create no legal rights. It is a nullity. But a voidable contract is a contract with a flaw of which one of the parties may, if he please, take advantage. If he chooses to aflSrm, or if he fails to use his power of avoidance within a reasonable time so that the position of parties becomes altered, or if he take a benefit under the contract, or if third parties acq\iire rights under it, he will be bound by it. An illustration will show the essential difference between what is void and what is voidable. (1) A sells goods to X, being led to think that X is Y: X sells the goods to M. The transaction between A and X is void, and M acquires no right to the goods." ^ (2) A sells goods to X, being led by the fraud of X to think that the market is falling. Before A has discovered the fraud or has acted on the discovery, X resells the goods to M, who is innocent of the fraud, and gives value for the goods. M acquires a good title to the goods, and A is left to his remedy against X by the action for deceit, an action ex delicto} ^ In the first of these cases the nuUity of the contract pre- vents any rights arising under it when the mistake is proved. In the second there is a contract, and one capable of creating rights, and the person defrauded has a power to aflSrm or avoid, limited as above described. 19. Unenforceable contracts. The difference between what is voidable and what is unenforceable is mainly a difference between substance and procedure. A contract may be good, but incapable of proof owing to lapse of time, want of written form, or faflure to affix a revenue stamp.' Writing in the first a Cundy v. Lindsay, (1878) 3 App. Cas. 459. h Babcock v. Lawson, (1880) 4 Q.B.D. 394. ' See Barker v. Dinsmore, (1872) 72 Pa. 427; Rodlifi v. Dallinger, (1886) 141 Mass. 1; Edmunds v. Merchants' &c. Co., (1883) 135 Mass. 283. 2 Rowley v. Bigelow, (1832, Mass.) 12 Pick. 307. ' In the case of a void contract, the acts of the parties that would usually operate to create new contractual relations have no such operation. Rights will exist after such a transaction, but they will not be contract rights. A contract right is a primary right in personam arising from expressions of consent; the chief operative facts are expressions of agreement. In the 20 THE FORMATION OF CONTRACT [Chap. II cases, a stamp in the last, may satisfy the requirements of law and render the contract enforceable, but it is never at any time in the power of either party to avoid the transaction. The contract is unimpeachable, only it cannot be proved in court.' 20. Confusions of tenninology. This much will suflice to guide the student as to the meaning of these terms, but he must be prepared to find their distinction obscured by laxity in the uses of the word " void." Not only is the term " void contract " in itself technically inaccurate, but a contract is sometimes said to be void, not because it was destitute of legal effect from its commencement, but because it has been fully performed, and so has ceased to have legal operation. It would be more proper to describe such a contract as " discharged." Again the word " void " has been used, even by judges and the framers of statutes, where " voidable " is meant. One illustration will suflBce. By 17 Geo. Ill, c. 60, failure to pay case of a void contract, there are such expressions; but they are not opera- tive facts at all. Standing alone, they have no legal effect. They may, however, be accompanied by other facts, e.g. a dehvery of goods, that have legal operation. The rights consequent upon a void contract are always primary rights in rem, or secondary rights in personam arising from a breach of a right in rem, or quasi-contractual rights in personam existing inde- pendently of any expression of consent. In the case of a voidable contract, the acts of the parties operate to create new legal relations. These are usually described as including present rights and duties just as in the case of a valid contract, but subject to the power of avoidance at the will of one of the parties. Another way of de- scribing a voidable contract is to say that there are no contractual rights or duties existing but that one of the parties has an irrevocable power to create them. The term unenforceable contract includes both void contracts and voidable contracts after avoidance. The author uses the term so as to describe certain other legal relations. When a contract has become unenforceable by virtue of the statute of limitations, the obligor or debtor has a power to create a new right in the other party as against himself by a mere expres- sion of his will and without going through the formalities of contract. He cannot, however, as in a voidable contract, destroy the existing rights of the other party or create new rights in himself as against that other. When a contract is unenforceable by reason of the statute of frauds, either party has the legal power to create rights as against himself by signing a written memorandum, he has no such power to create rights in his own favor. The case of the revenue stamp is somewhat different. In these cases a legal relation exists that is different from that existing in the case of a void contract or of a voidable one. It appears that this difference is not as the author says "mainly a difference between substance and procedure." The difference between a power to create a right against another person and a power to create a right against only oneself is not merely procedural. 1 Bird V. Munroe, (1877) 66 Me. 337. Chap. II] TERMINOLOGY 21 certain duties at an auction is stated to make a bidding, " null, and void to all intents," but this does not entitle a purchaser who has repented of his bargain to avoid the contract by his own wrong, that is by refusal to pay the statutory duty. The contract is voidable at the option of the party who has not broken the condition imposed by law." '■ a Malins v. Freeman, (1837) 4 Bing. N.C. 395. ' The term "void" is frequently used in statutes and contracts, and in the decisions of courts where the term "voidable " would be more accurate. In such cases the latter term is to be substituted in determining the mean- ing of the statute, contract or decision. Van Shaack v. Robbins, (1873) 36 Iowa, 201; Ewell v. Daggs, (1883) 108 U.S. 143; Bennett v. Mattingly, (1886) 110 Ind. 197; Somes v. Brewer, (1824, Mass.) 2 Pick. 184; Anderson V. Roberts, (1820, N.Y.) 18 Johns. 516; PearsoU v. Chapin, (1862) 44 Pa. 9. CHAPTER III Offer and Acceptance A CONTRA.CT consists in an actionable promise or promises. Every such promise involves two parties, a promisor and a promisee, and an expression of common intention and of expec- tation as to the act or forbearance promised. So on the thresh- old of our subject we must bring the parties together, and must ask. How is this expectation created which the law will not allow to be disappointed? This part of our subject may be set forth briefly in the rules which govern offer and acceptance. 1. Every contract springs from the acceptance of an offer 21. Agreements originate in offer and acceptance. Every expression of a common intention arrived at by two or more parties is ultimately reducible to question and answer. In speculative matters this would take the form, " Do you think so and so? " " I do." For the purpose of creating obligations it may be represented as, " Will you do so and so? " " I will." If A and X agree that A shall purchase from X a property worth £50,000, we can trace the process to a moment at which X says to A," Will you give me £50,000 for my property? " and A replies, " I will." If A takes a sixpenny book from X's book- stall the transaction is reducible to the same elements. X in displaying his wares says in act though not in word, "Will you buy my goods at my price? " and A, taking the book with X's cognizance, says in act, " I will." So the law is laid down by Blackstone: " " If I take up wares from a tradesman with- out any agreement of price, the law concludes that I con- tracted to pay their real value." There may be difficulty in the uniform application of this rule. Sir F. Pollock '' suggests cases to which it may not readily apply — the signature of a prepared agreement — the accept- ance by two parties of terms suggested by a third. But I should be disposed to say that his instances are reducible to question ^and answer in an elliptical form. If A and X are discussing the terms of a bargain, and eventually accept a suggestion a Comm. bk. 2, o. 30. 6 Contraota (7th ed.). p. 7. Chap. Ill] OFFER AND ACCEPTANCE 23 made by M, there must be a moment when A, or X, says or intimates to the other, " I will accept if you will." " It is unwise, as Sir F. Pollock truly says, to push analysis too far: but on the other hand it is a pity to give up a good working principle because its application is sometimes difficult. As a promise involves something to be done or forborne it follows that to make a contract, or voluntary obligation, this expression of a common intention must arise from an offer made by one party to another who accepts the offer made, with the result that one or both are bound by a promise or obligatory expression of intention. 22. Forms of offer and acceptance. This process of offer and acceptance may take place in any one of four wajrs. 1. In the offer to make a promise or to accept a promise made, followed in either case by simple assent: this, in English law, applies only to contracts imder seal. 2. In the offer of an act for a promise; as if a man offers goods or services which when accepted bind the acceptor to reward him for them. 3. In the offer of a promise for an act; as when a man offers a reward for the doing of a certain thing, which being done he is boimd to make good his promise to the doer. 4. In the offer of a promise for a promise, in which case, when the offer is accepted by the giving of the promise, the contract includes outstanding duties on both sides. It appears then that offer may assiune three forms, the offer to make a promise, the offer to assent to a promise, and the offer of an act. Acceptance may likewise assume three forms, simple assent, the giving of a promise, or the doing of an act. ' 23. Illustrations. But the foregoing modes of offer and acceptance need explanation. 1. Contract under seal. The first is, in English law, appli- cable only to such contracts as are made under seal, for no promise, not under seal, is binding unless the promisor obtains something from the promisee in return for his promise. This something, which may be an act, a forbearance, or a promise, is called consideration. a The case of Clarke v. Dunraven instanced by Sir F. Pollock will be discussed later; [see § 63 post]. It suggests diSBoulties of a different character. * It is believed that the following would be a more accurate form of statement: (1) An offer made by the tender of delivery of a sealed instrument. 24 THE FORMATION OF CONTRACT [Chap. Ill The offer may take the form, " I will promise you £50 if you will accept it," or, " I will accept £50 if you will promise it to me." In either case the promise must be made under seal if it is to bind the promisor. In the first case assent is needed to turn the offer of a promise into a contract: for a man cannot be forced to accept a benefit." ' In the second case acceptance takes the form of a promise to which assent has been secured by the terms of the offer. ^ Services or goods are offered which no one expects to get for nothing. A man cleans my windows, blacks my boots, sends goods to my house, imasked; an act is offered for a prom- ise; and one who is willing to accept these services or goods promises by his acceptance to pay their cost. But the circum- stances must be such as to indicate a real acceptance of the offer; for I cannot be compelled to accept services against my will, nor to pay for the blacking of boots which I have no choice a Townson v. Tiokell, (1819) 3 B. & Aid. 37. (2) An oflFer whereby a power is conferred upon the offeree to create a duty in himself alone with a correlative right in the offeror. (3) An offer whereby a prawer is conferred upon the offeree to create a right in himself alone with a correlative duty in the offeror. (4) An offer giving to the offeree the power to create mutual rights in personam with their correlative mutual duties. In each case both the offer and the acceptance are acts ; in cases (2) and (3) one of those acts is a promise; in case (4) both acts are promises. Cases (2), (3), and (4) may all be put in form (1). Illustrations of (2) and (3) as are follows: (2) A hands to B a chattel, saying, " This is yours when you promise me $10." Mactier v. Frith, (1830, N.Y.) 6 Wend. 103. (3) A writes to B, "Let Harry have $100 and I will repay it." Bishop v. Eaton, (1894) 161 Mass. 496; Wheat v. Cross, (1869) 31 Md. 99. ' "Rights" can often be conferred upon one without either his knowledge or consent although he may have the power to destroy them by renuncia- tion. Such is the case where a deed is delivered in escrow by A to C for the benefit of B. See Butler and Baker's Case, (1591) 3 Coke, 25a; Roberts V. Security Co., [1897] 1 Q.B. Ill; Xenos v. Wickham, (1867) L.R. 2 H.L. 296. There is some doubt whether a delivery can be made without the assent of the one to whom it is tendered. If not, then the tender of delivery is the offer and the assent is the acceptance (but this assent is not necessarily that of the one who is to have rights). In the United States assent of the deUveree is generally supposed to be necessary. See Meigs v. Dexter, (1898) 172 Mass. 217; Welch v. Sackett, (1860) 12 Wis. 243; Deny Bank v. Webster, (1862) 44 N.H. 264; Gorham's Adm'r v. Meacham's Adm'r, (1891) 63 Vt. 231. ' If .4 merely says to B that he will accept the delivery of a sealed instrument in case B shall thereafter tender it, A's statement has no legally operative effect whatever, with respect to the legal operation of the sealed document. Chap, mj OFFER AND ACCEPTANCE 25 but to wear, merely because an enterprising tradesman insists on blacking them.' 2 . Act for promise. A man gets into a public omnibus at one end of Oxford Street and is carried to the other. The presence of the omnibus is a constant offer by its proprietors of such services upon certain terms; they offer an act for a promise; and the man who accepts these services promises by his accept- ance to pay the fare when duly demanded.'' 3. Promise for act. A man who loses his dog offers by adver- tisement a reward of £5 to any one who will bring the dog safe home; he offers a promise for an act; and when X, knowing of the offer, brings the dog safe home the act is done and the prom- ise becomes binding.' 4. Promise for promise. A offers X to pay him a certain sum on a future day if X will promise to perform certain serv- ices for him before that day. When X makes the promise asked for he accepts the promise offered, and both parties are bound, the one to do the work, the other to allow him to do it and to pay for it.* 24. Unilateral and bilateral contracts. It will be observed that cases 2 and 3 differ from 4 in an important respect. In 2 and 3 the contract does not come into existence until one 1 An illustration of a unilateral contract where the offeree assumes the duty is as follows: A dealer in horses says to X, pointing to a specific horse, "this horse is yours as he stands in return for your promise of $100 in 30 days." If X makes the requested promise the contract is made and it is unilateral in character. It is an executed sale on credit without warranty. The thing offered is not strictly an act; it is the ownership of the horse. The dealer's offer confers upon X a power to make the horse his own by making the requested promise. No duty rests upon the offeror, and the offeree gets no right in personam. The offeror gains a right in personam and the offeree gets instantly certain rights in rem. See Fogg ». Portsmouth Athenaum, (1862) 44 N.H. 115. No contract can be made by the offer of an act for a promise, for an act done before the return promise is made would be past consideration. See § 148. The illustrations given in the text are subject to this objection. In some such cases, no doubt there would be a legal duty to pay, quasi- contractual in character; in such cases the express promise seems to be almost superfluous. In other cases of this kind, it may be possible to infer mutual promises from the conduct of the parties, before the service is fully completed. The case would then belong to class 4. • This case appears to fall within class (4) as a bUateral contract. If the car is a pay-as-you-enter, the money is offered for a promise to carry, and the case belongs in class (3). » Reif V. Paige, (1882) 55 Wis. 496; Pierson v. Morch, (1880) 82 N.Y. 503. * White V. Corlies, (1871) 46 N.Y. 467; Boston & Maine R. v. Bartlett, (1849, Mass.) 3 Cush. 224. 26 THE FORMATION OF CONTRACT [Chap. IU party to it has done all that he can be required to do. It is performance on one side which makes obligatory the promise of the other; the outstanding obligation is all on one side. In 4 each party is bound to some act or forbearance which, at the time of entering into the contract, is future: there is an out- standing obligation on each side. In case 1 the promisee alone is benefited: in cases 2 and 3 the promisor and promisee alike take benefit, but the duty does not come into existence imtil the promisor has obtained all that he is to get under the contract: in case 4 the benefits contemplated by the parties are expressed in their mutual promises. We may, if we please, call 1, 2, 3, unilateral, and 4 bilateral contracts.^ 25. Executed and executory consideration. Where, as in cases 2 and 3, it is the doing of the act which concludes the contract, then the act so done is called an executed " or present consideration for the promise. Where a promise is given for a promise, each forming the consideration for the other, such a consideration is said to be executory or future. 2. An offer or its acceptance or both may be made either by words or by other conduct 26. Tacit contract. The description which I have given of the possible forms of offer and acceptance shows that conduct a The words executed and executory ^re used in three different senses in relation to con- traot, according to the substantive with which the adjective is joined.* Executed ccynsideration as opposed to executory means present as opposed to fviwe, an act as opposed to a promise. Executed ctmtract means a contract performed wholly on one side, while an executory contract is one which is either wholly unperformed or in which there remains something to be done on both sides. Leake (6th ed.), p. 6. Parke, B., in Foster i. Dawber, (1851)6Exch. 851. Executed c(mtract of sale means a bargain and sale which has passed the property in the thing sold, while executory contracts of sale are contracts as opposed to conveyances and create rights in personam to a fulfillment of their terms instead of rights in rem to an enjoy- ment of the property passed. Chalmers, Sale of Goods Act (7th ed.), pp. 9 & 10. * This shows that the tenn "executed" is a slippery word. Its iise is to be avoided except when accompanied by explanation. Executed considera- tion is also used to mean past consideration as opposed to present or future. See I Williston's Cases on Cont. 311. A contract is frequently said to be executed when the document has been signed, or has been signed, sealed, and deUvered. Further, by executed contract is frequently meant one that has been fully performed by both parties. ' Langdell, Summary of Law of Contract, §§ 183-187. A promissory note is a good example of a unilateral contract. The mutual promises of a seller to deliver goods and of the buyer to pay for them when delivered, constitute a bilateral contract. It is quite possible for the sealed instrument in class (1) to be bilateral as well as to be imilateral. For other illustrations and discussion see Arthiu: L. Corbin, " Offer and Acceptance and Some of the Resulting Legal Relations," 26 Y This is quite correct, if the proposed contract is to be unilateral, the required mode of acceptance being the delivery of the goods. But if, prior to the party's death, there was a completed bilateral contract to buy and to sell, the validity of such contract is not affected by the death. There is no inevitable necessity that the power of acceptance shall be terminated by death of the offeror; the German Civil Code, § 153, provides that such death shall not end the power, unless the contrary intention appears. So also, the offer may in certain instances be irrevocable, by death or otherwise. See § 50, infra. ' This means: effective whether communicated or not. ' An attempted acceptance made in the wrong manner or at the wrMig time should be regarded as a counter offer, creating in its turn a power of acceptance in the original offeror. It has been suggested that in such case silence by the original offeror should be regarded as an acceptance. Phillips V. Moor, (1880) 71 Me. 78. See also German Civil Code, § 149; Swiss Code Oblig. § 5; Jap. Civil Code, Art. 522; Morrell v. Studd, [1913] 2 Ch. 648. Contra: Ferrier v. Storer, (1884) 63 Iowa, 484. Chap. Ill] OFFER AND ACCEPTANCE- 49 "It is an undeniable principle of the law of contract, that an offer of a bargain by one person to another imposes no obligation upon the former, until it is accepted by the latter according to the tenns in which the offer was made. Any quaUfication of or departure from these terms mvahdates the offer unless the same be agreed to by the person who made it." " » 46. Lapse by faUure to accept within time prescribed. Some- times the parties fix a time within which an offer is to remain open; more often it is left to a comi of law, in the event of litigation, to say what is a reasonable time within which an offer may be accepted. Instances of a prescribed time are readily supplied. "This offer to be left over till Friday, 9 a.m. 12th June," allows the offeror to revoke, or the offeree to accept the offer, if unrevoked, at any time up to the date named, after which the offer would lapse.*" ^ An offer to supply goods of a certain sort at a certain price for a year from the present date " — an offer to guarantee the payment of any bills discounted for a third party for a year from the present date "^ — are offers which may be turned into contracts by the giving of an order in the one case, the discount of bills in the other. Such offers may be revoked at any time, except as regards orders already given or bills already dis- coimted, and they will in any event lapse at the end of a year from the date of offer.' A promise to keep an offer open would be binding if a consid- eration is given in return for it, and not otherwise. The offeree in such a case is said to "purchase an option," that is, the offeror, in consideration usually of a money payment, binds himself not to revoke his offer during a stated period. In this case the offeror by his promise precludes himself from exercising his power to revoke the offer; but where he receives no considera- tion for keeping the offer open, he says in effect, "You may a Eliason v. Henshaw, (1819, U.S.) 4 Wheaton, 225. i> Dickinson v. Dodds, (1876) 2 Ch. D. 463. c G.N.R. Co. V. Witham, (1873) L.R. 9 C.P. 16. d Offord ». Davies, (1862) 12 C.B., N.S. 748. 1 Eliason v. Henshaw, (1819, U.S.) 4 Wheat. 225; Home v. Niver, (1897) 168 Mass. 4 (where answer by telegram requested, letter insufficient). ^ " A limitation of time for which a standing offer is to run is equivalent to the withdrawal of the offer at the end of the time named." Longworth V. Mitchell, (1875) 26 Ohio St. 334, 342. See also Maclay v. Harvey, (1878) 90 m. 525. » Cooper V. Lansing Wheel Co., (1892) 94 Mich. 272; Schenectady Stove Co. V. Holbrook, (1885) 101 N.Y. 45; Schlee v. Guckenheimer, (1899) 179 ni. 593; Hopkins v. Racine Iron Co., (1909) 137 Wis. 583. 50 THE FORMATION OF CONTRACT [Chap. Ill accept within such and such a time unless in the mean time I have revoked the offer." * An instance of an offer lapsing by the efflux of a reasonable time is supplied by the case of the Bamsgate Hotel Co. v. Monte- ficrre." Montefiore offered by letter dated the 28th of June to purchase shares in the company. No answer was made to him until the 23d of November, when he was informed that shares were allotted to him. He refused to accept them, and it was held that his offer had lapsed by reason of the delay of the company in notifying their acceptance.* * Revocation 47. General rules as to revocation of offer. (1) An offer may be revoked at any time before acceptance. (2) An offer is made irrevocable by acceptance. ' 48. Revocation before acceptance. The first of these state- ments is illustrated by the case of Offord v. Davies.'' Messrs. Davies made a written offer to the plaintiff that if the plaintiff would discount bills for another firm, they (Messrs. Davies) would guarantee the payment of such bills to the extent of £600 during a period of twelve calendar months. Some bills were discounted by Offord, and duly paid, but before the twelve months had expired, Messrs. Davies, the guarantors, revoked their offer and annoimced that they would guarantee no more bUIs. Offord continued to discount biUs, some of which were not paid, and then sued Messrs. Davies on the guarantee. It was held that the revocation was a good a (1866) L.R. 1. Exoh. 109. 6 (1862) 12 C.B., N.S. 748. 1 Weaver v. Burr, (1888) 31 W.Va. 736; Hayes v. O'Brien, (1894) 149 111. 403. A piirchase of one lot under a standing offer has been treated as a consideration for keeping the offer open during the rest of the time stipulated, but this is doubtful doctrine. Cooper v. Lansing Wheel Co., (1892) 49 Mich. 272. See post, § 51, note on " Irrevocable Offers." 2 Maclay v. Harvey, (1878) 90 111. 525; Minnesota Oil Co. v. Collier, (1876, U.S. C.C.) 4 DiU. 431; Ortman v. Weaver, (1882) 11 Fed. 358; Stone V. Harmon, (1884) 31 Minn. 512; Baker v. Holt, (1882) 56 Wis. 100. As to when an offer of a reward would lapse, see Loring v. Boston, (1844, Mass.) 7 Met. 409; Mitchell v. Abbott, (1894) 86 Me. 338; Matter of Kelly, (1872) 39 Conn. 159. The doctrine that the offeror receiving an acceptance after the offer has lapsed should notify the offeree that the acceptance is too late [PhiUips v. Moor, (1880) 71 Me. 78] must be regarded as doubtful [Ferrier v. Storer, (1884) 63 Iowa, 484; Maclay v. Harvey, supra], but it is expressly adopted by the Swiss Code of Oblig. § 5. See also § 45, ante, and note. Chap. Ill] OFFER AND ACCEPTANCE 61 defense to the action. The alleged guarantee was an offer, extending over a year, of promises for acts, of guarantees for discounts. Each discount turned the offer into a promise, pro tank), but the entire offer could at any time be revoked except as regarded discounts made before notice of revocation. " » 49. Revocation ineffective after acceptance. The second statement is illustrated by the Great Northern Railway Com- pany V. Witham,^ a transaction of the same character. The company advertised for tenders for the supply of such iron ar- ticles as they might require between 1st November, 1871, and 31st October, 1872. Witham offered to supply them on certain terms, and his tender was accepted by the company. Orders were given and executed for some time on the terms of the tender, but after a while Witham refused to execute orders. The company sued him for non-performance of an order given, and he was held liable. It is important to note the exact relations of the parties. The company by advertisement invited all dealers in iron to make offers. The tender of Witham was an offer which might be accepted at any time, or any number of times in the ensuing twelve months. The acceptance of the tender did not make a contract, it was merely an intimation by the company that they regarded Witham's tender as an offer. The company were not boxmd to order any iron: and Witham might, at any time before an order was given, have revoked his offer by notice to the company: but each order given was an acceptance of Witham's standing offer, and bound him to supply so much iron as the order comprised.^ a It should be noticed that in the judgment in OSord v. Davies, and also to a less extent in the Great Northern Railway Company v. Witham, the word "promise" is used where "offer of promise" is clearly meant. A revocable promise is unknown to our law. A promise may be void, voidable, or unenforceable from defects in the formation of the contract, or it may be discharged by some subsequent event, but a promise, whether actionable or not, is not revocable at the pleastire of the promisor.* b (1873) L.R. 9 C.P. 16. * The present editor prefers to follow the usage of the courts in this matter. See § 6, ante. 1 Fisher #. Seltzer, (1854) 23 Pa. 308 (retraction of bid at auction; ; Head V. Clark, (1889) 88 Ky. 362 (same); White v. Corlies, (1871) 46 N.Y. 467 (order for work coimtermanded); Travis v. Nederland &c. Co., (1900) 104 Fed. 486 (second offer modifying first); Shuey e. United States, (1875) 92 U.S. 73 (withdrawal of offer of reward); Biggers v. Owen, (1887) 79 Ga. 658 (same). 2 See Cooper v. Lansing Wheel Co., (1892) 94 Mich. 272. These cases present some diflBculties. (1) A makes to B an offer to fur- nish B with such goods or services as B may order for a definite period at 62 THE FORMATION OF CONTRACT [Chap. Ill An order given after 31st October, 1872, would have been an acceptance after the prescribed time, and inoperative." SO. Offer under seal is irrevocable. An exception to this a There are two later cases in which the conditions were similar to those above describedt though the point in issue was not the same; in neither case was the principle above laid down impugned. In Ford v. Newth, [1901] 1 K.B. 690, the question to be decided was whether a man whose tender had been accepted by a corporation possessed an "interest in a contract" which under § 12 of the Municipal Corporations' Act, 1882, would disqualify him for election as a Councillor. Mr. Newth had made a tender; it was accepted; orders had been ^ven and executed; and money was actually due to him from the Corporation at the date of his Candi- dature. The Judges had no difficulty in deciding that he had a disqualifying interest; but their language tends somewhat to obscure the effects of the legal relation arising from the acceptance of a tender. In E. v. Demers, [1900] A.C. 103, the Judicial Committee were care- ful not to admit the existence of a contract, and merely held that the acceptance of a tender did not involve a duty to give orders- to the person making the tender. a specified price, and B " accepts." There is no contract, because B does not bind himself even contingently to order any goods or services, and there- fore furnishes no consideration for A's promise. B's apparent promise contained in his acceptance is illusory, and gives to A no more ground for expecting action by B than existed before the giving of the promise. Per- formance by B rests just as before in his own will and desire. Chicago &c. Ry. V. Dane, (1870) 43 N.Y. 240; Thayer v. Burchard, (1868) 99 IVIass. 508; Teipel v. IVleyer, (1900) 106 Wis. 41; Petroleum Co. v. Coal &c. Co., (1890) 89 Tenn. 381; American Oil Co. v. Kirk, (1895) 68 Fed. 791. But while the offer is outstanding an order given by B is an acceptance pro tanto and completes the contract to that extent. Great Northern Ry. v. Witham (text) ; Keller v. Ybarru, (1853) 3 Cal. 147; Cases supra. This is because A's offer was evidently intended to create a power in B, but in order to exer- cise this power B's act must supply consideration. If B orders a specified amoimt of goods or service, there is an impUed promise to pay for them at specified rates, thus completing a bilateral contract. If B incloses the agreed price with his order, the contract becomes unilateral on receipt of the money. This construction of the offer creates in the offeree the power to make a series of separate contracts by separate acceptances. That these acceptances must be within the specified time, or if none is specified, then within a reasonable time, see Chicago &c. Ry. Co. v Dane, supra. (2) A makes to jB an offer to furnish B with all the goods of a specified kind that B may need in a particular business during a definite period, and B accepts the offer; or B makes an offer to purchase such goods as he may need in such business, and A accepts the offer. This is a contract, because B binds himself, although contingently, to buy ot A. If B needs such goods in that business and buys elsewhere, there is a breach of contract. Lima Loco, and M. Co. v. Nat'l Steel Castings Co., (1907, CCA.) 155 Fed. 77; National Furnace Company v. Keystone Mfg. Co., (1884) 110 HI. 427; Minnesota Lumber Co. v. Whitebreast Coal Co., (1896) 160 111. 85; Wells v. Alexandre, (1891) 130 N.Y. 642; Hickey v. O'Brien, (1900) 123 Mich. 611: Loudenback Fertilizer Co. v. Tennessee Phosphate Co., (1903) 121 Fed. 298. Contra, Bailey v. Austrian, (1873) 19 Minn. 635; Drake v. Vorse, (1879) 52 Iowa, 417; Jenkins v. Sugar Co., (1916) 237 Fed. 278, 30 Harvard Law Review, 517. And see as presenting diflBcuIt questions of construction, Crane v. Crane, (1901) 105 Fed. 869; Davie v. Mining Co., (1892) 93 Mich. 491; Dailey Co. v. Can Co., (1901) 128 Mich. 591; McKeever v. Cannonsburg Iron Co., (1888) 138 Pa. 184. Where the words used by the parties are at all doubtful, the courts generally lean toward that construction that carries out the apparent intention of the parties to make a valid bilateral contract. For many modem cases to Chap. Ill] OFFER AND ACCEPTANCE 53 general rule as to the revocability of an offer must be made in the case of an offer under seal. It is said that this cannot be revoked: ^ even though it is not communicated to the offeree it remains open for his acceptance when he becomes aware of its existence. There is no doubt that a grant under seal is binding on the grantor and those who claim under him, though it has never been communicated to the grantee, if the deed has been duly delivered; " ^ and it would seem that an obligation created by deed is on the same footing. The promisor is bound, ^ but the promisee need not take advantage of the promise unless he choose: he may repudiate it, and it then lapses. "ISA make an obligation to B and deliver it to C, this is the deed of A presently. But if C offers it to B, then B may refuse it in pais, and thereby the obligation will lose its force." ' The situation in such a case is anomalous. It is in fact ir- reconcilable with the modem analysis of contract as meaning an expression by at least two persons of a common intention whereby expectations are created in the mind of one or both. A promise under seal is factum, a thing done beyond recall; and the promisor is in the position of one who has made an offer which he cannot withdraw, or a conditional promise de- pending for its operation on the assent of the promisee.* a Doe d. Gamons «. Kniglit, (1826) 5 B. & C. 71. "Delivery" of a deed does not nec- essarily involve the handing of it over to the other party to the contract. b Butler & Baker's case, (1591) Coke, Hep. iii. 26. b. this effect, and also for cases contra, see extended , notes in 11 L.R.A. (N.S.) 713; 43 L.R.A. (N.S.) 730. It would seem that Cooper v. Lansing Wheel Co., supra, should fall in the second class, although the court says the offeror might have withdrawn the offer. The doctrine there advanced that in a case of the first class an order once given furnishes a consideration for the promise to leave the of- fier open thereafter, is apparently not repeated elsewhere. Such a contract is valid if made, the only question being one of fact, whether or not the offeror made such a promise for the consideration of the first order. See Michigan Bolt Works v. Steel, (1896) 111 Mich. 153; Hickey v. O'Brien, supra. A mere invitation to make an offer or enter into negotiations must be distinguished. Moulton v. Kershaw, (1884) 59 Wis. 316. » McMillan v. Ames, (1885) 33 Minn, 257. ' But in many American states it is held that a deed does not become valid and bind the grantor imtil it has been accepted by the grantee, or by some one acting for him whose act is either authorized or ratified. Meigs V. Dexter, (1898) 172 Mass. 217; Derry Bank v. Webster, (1862) 44 N.H. 264; Welch v. Sackett, (1860) 12 Wis. 243. ' Irrevocable offers. It has been sometimes asserted that an irrevocable offer is "a legal impossibility." See Langdell, Summary of the Law of 54 THE FORMATION OF CONTRACT [Chap, m 51. Revocation must be communicated. It remains to state that revocation, as distinct from lapse, if it is to be operative, must be communicated. In the case of acceptance we have seen that it is communicated, and the contract made, if the offeree does by way of acceptance that which the offeror has directly or indirectly indicated as sufficient. The posting of a letter, the doing of an act, may constitute an acceptance and Contracts, § 178, also § 4; Wormser, " The Trae Conception of Umlateral Contracts," 26 Yale Law Journal, 137, note; Lee, title Contracts, in Jenks' Dig. of Eng. Civ. Law, § 195; Ashley, Contracts, § 13. A close analysis shows that there is nothing impossible either in the conception itself or in its appUcation. K we define "offer" as an act on the part of the offeror (see § 37a), then no offer can ever be revoked, for it is of yesterday — it is indeed factum. But if we mean by "offer" the legal relation that results from the offeror's act, the power then given to the offeree of creat- ing contractual relations by doing certain voluntary acts on his part, then the offer may be either revocable or irrevocable according to the circum- stances. The idea of an irrevocable power is not at all an imfamiliar one. The courts have held that most offers can be revoked only by giving actual notice to the offeree. If the giving of this notice is not possible, then the offer is irrevocable from a practical standpoint. The offeror may have the legal power to revoke, but not the physical ability to exercise it. Secondly, the offeror may have made an offer and have promised, for a consideration or under seal, not to withdraw it. In such cases the offeree has what is called a binding option. In these cases the offeror is not priv- ileged to withdraw his offer, and an action for damages Ues against him in any case where he repudiates his promise. Manary v. Runyon, (1903) 43 Ore. 495; Black v. Maddox, (1898) 104 Ga. 157; Dambmann v. Rittler, (1889) 70 Md. 380. In many of these cases the offeror is not only not legally privileged to withdraw his offer, but it is beyond his power, and the offeree's power to conclude the contract may be said to be truly irrevocable. In some of the following cases equity decreed specific enforcement in spite of an attempted revocation. O'Brien v. Boland, (1896) 166 Mass. 481; Watkins 0. Robertson, (1906) 105 Va. 269; McMillan v. Ames, (1885) 33 Minn. 257; Hayes v. O'Brien, (1894) 149 111. 403; Paddock v. Davenport, (1890) 107 N.C. 710; Hurford v. Pile, (1615) Cro. Jac. 483. It is sometimes provided by statute that offers shall be irrevocable un- der certain circumstances. See Swiss Code of ObUg. § 3; Grerman Civil Code, §§ 145, 658; Jap. Civ. Code, art. 521; Civil Code Ga. § 3645. The following cases hold that an offer becomes irrevocable after the offeree has taken substantial steps in the process of acceptance but has not yet completed the acceptance: Louisville & N.R. Co. v. Goodnight, (1874) 10 Bush (Ky.) 552; Los Angeles Traction Co. v. Wilshire, (1902) 135 Cal. 654; Zwolanek v. Baker Mfg. Co., (1912) 150 Wis. 517; Louisville and N.R. Co. v. Coyle, (1906) 123 Ky. 854; Braniff v. Blair, (1917, Kan.) 165 Pac. 816. See also the charitable subscription cases, § 142, post. Con- tra: Biggers v. Owen, (1887) 79 Ga. 658; Gray «. Hinton, (1881) 7 Fed. 81; StensgaardM. Smith, (1890) 43 Minn. 11. For a full discussion, see Corbin, " Offer and Acceptance and Some of the Resulting Legal Relations," (1917) 26 Yale Law Journal, 169, 185-197; Mc- Govney, " Irrevocable Offers," 27 Harvard Law Review, 644. Chap. Ill] OFFER AND ACCEPTANCE 55 make a contract. The question at once arises, Can revocation be communicated in the same way, by the posting of a letter of revocation, by the sale of an article offered for purchase? The answer must be (subject to the consideration of two cases to which I will presently advert), that revocation of an offer is not communicated unless broiight to the knowledge of the offeree. The rule of law on this subject was settled in Byrne v. Van TienJioven." The defendant, writing from Cardiff on October 1st, made an offer to the plaintiff in New York asking for a reply by cable. The plaintiff received the offer on the 11th, and at once accepted in the manner requested. On the 8th the defendant had posted a letter revoking his offer. The questions which Lindley, J., considered to be raised were two. (1) Has a revocation any effect until communi- cated? (2) Does the posting of a letter of revocation amount to a communication to the person to whom the letter is sent? He held (1) that a revocation was inoperative until communi- cated,' (2) that the withdrawal of an offer was not communicated by the mere posting of a letter; and that therefore an acceptance made by post is not affected by" the fact that a letter of revo- cation is on its way." He points out the inconvenience which would result from any other conclusion. "If the defendant's contention were to prevail no person who had received an offer by post and had accepted it, would know his position imtil he had waited such time as to be quite sure that a letter with- drawing the offer had not been posted before his acceptance if it. It appears to me that both legal principle and practical convenience require that a person who has accepted an offer not known to him to have been revoked, shall be in a position safely to act upon the footing that the offer and acceptance constitute a contract binding on both parties." ' The case of Henthom v. Eraser,^ decided in the Court of Appeal, extends this rule to the case of a written offer de- a (1880) 5 C.P.D. 344. b [1892] 2 Ch. 27, C.A. 1 Tayloe v. Merchants' Fire Ins. Co., (1850, U.S.) 9 How. 390; Patrick V. Bowman, (1893) 149 U.S. 411; The Palo Alto, (U.S. C.C.) 2 Ware, 344. 2 Brauer v. Shaw, (1897) 168 Mass. 198; Wheat v. Cross, (1869) 31 Md. 99. Stevenson v. McLean, (1880) 5 Q.B.D. 346. ' There is American authority for the view that the revocation of an ofEer made by advertisement need not be communicated to the offeree. As such an offer is made to the whole world, it clearly can be revoked only in the way in which it is made — by advertisement. See Shuey v. United States, (1875) 92 U.S. 73; Sears v. Eastern R. Co., (1867) 14 Allen (Mass.) 433. The same rule is adopted in the German Civil Code, § 658, and in the Jap. Civil Code, art. 530. 56 THE FORMATION OF CONTRACT [Chap. Ill livered by hand and accepted by post. Lord Herschell there says: "The grounds on which it has been held that the acceptance of an offer is complete when it is posted, have I think no application to the revocation or modification of an offer. These can be no more effectual than the offer itself unless brought to the mind of the person to whom the offer is made." The same principle is illustrated by Curtice v. City of London and Midland Bank." Payment of a check was countermanded by a telegram, which, by the negligence of the bank's servants, was not brought to the notice of the manager until after the check was paid; it was held that the telegram was inoperative to countermand payment. ^ 52. Promise to leave offer open. Cook v. Oxley. There are two cases which have been thought to suggest that when the offer is an offer to sell property it may be revoked merely by the sale of the property to a third person, and without com- munication to the offeree. This view may be dismissed, but the cases raise other points of interest. In Cook V. Oxley ^ the defendant offered to sell specific goods to the plaintiff on certain terms and to keep the offer open until 4 o'clock that day. Cook averred that he did agree within the time allowed, but that Oxley failed to deliver. The Court held that a promise to keep the offer open till 4 o'clock was not binding for want of consideration, and that — "The promise can only be supported on the ground of a new contract made at 4 o'clock; but there is no pretense for that. It has been argued that this must be taken to be a complete sale from the time the con- dition was complied with; but it was not complied with, for it is not stated that the defendant did agree at 4 o'clock to the terms of the sale, or even that the goods were kept till that time." These last words suggest that, in the view of the court, Oxley was not only free to revoke his offer at any time before accept- ance, but free to revoke it by a mere sale of the goods without notice.^ a [1908] 1 K.B. 293 (C.A.). b (1790) 3 T.R. 653. ' This case is in point because, although the check is not an offer, it does create a power; and the question is as to how such a power can be terminated. 2 This use of the word "free " is open to objection, although it is not un- common. There is no doubt that Oxley was "free " or privileged to revoke, , — that is, he was under no duty not to revoke. Beyond question, also, he had the legal power to revoke. It is now well settled, however, that this power can be exercised only by actual notice to Cook. Chap. Ill] OFFER AND ACCEPTANCE 67 But if the report of this case is carefully examined it will be seen that while the pleader stated a good cause of action, the arguments of counsel for the plaintiff took a different and an untenable ground. The plaintiff's declaration sets forth clearly enough an offer turned into a contract by acceptance at 4 p.m. But the argument addressed to the court set up a conditional sale of the property if Cook chose to declare himself a buyer before 4 o'clock: so that Oxley was bound to sell if required, but Cook was not bound to buy. The court held that the alleged promise to keep the goods till 4 p.m. was nvdwm pactum, and the case is merely authority for saying that such a promise is not binding without consideration. The question of the suf- ficiency of the revocation was never raised.^ 53. Revocation communicated by stranger. The other case is Dickinson v. Dodds,"' a suit for specific performance of a con- tract under the following circumstances. On the 10th of Jime, 1874, Dodds gave to Dickinson a memorandmn in writing as follows: "I hereby agree to sell to Mr. George Dickinson the whole of the dwelling-houses, garden ground, stabling and out-buildings thereto belonging situated at Croft, belonging to me, for the sum of £800. As witness my hand this 10th day of Jime, 1874. "£800 {Signed) John Dodds." "P.S. This offer to be left over until Friday, 9 o'clock a.m. J. D. (the twelfth) 12th June, 1874. " {Signed) J. Dodds." On the 11th of June he sold the property to another person without notice to Dickinson. As a matter of fact Dickinson was informed of the sale, though not by any one acting under the authority of Dodds. He gave notice, after the sale but before 9 o'clock on the 12th, that he accepted the offer to sell, and sued for specific performance of what he alleged to be a contract. The Court of Appeal held that there was no contract. James, o (1876) 2 Ch. D. 463. * "That case [Cook v. Oxley] has been supposed to be inaccurately reported; and that in fact there was in that case no acceptance. But, however that may be, if the case has not been directly overruled, it has certainly in later cases been entirely disregarded, and cannot now be con- sidered as of any authority." Fletcher, J., in Boston &c. R. v. Bartlett, (1849, Mass.) 3 Cush. 224, 228. See also Nyulasy v. Rowan, (1891) 17 Vict. L.R. 663. 58 THE FOEMATION OF CONTRACT [Chap, m L.J., after stating that the promise to keep the offer open could not be binding, and that at any moment before a complete acceptance of the offer one party was as free as the other, goes on to say: "It is said that the only mode in which Dodds could assert that freedom was by actually and distinctly saying to Dickinson, 'now I withdraw my offer.' / apprehend that there is neither principle nor authority for the proposition that there must he an actiud and express withdrawal of the offer, or what is called a retraction. It must to con- stitute a contract appear that the two minds were one at the same moment of time, that is, that there was an offer continuing up to the moment of acceptance. If there was not such a continuing offer, then the acceptance comes to nothing. Of coiirse it may well be that the one man is boimd in some way or other to let the other man know that his mind with regard to the offer has been changed; but in this case, beyond all question, the plaintiff knew that Dodds was no longer minded to sell the property to him as plainly and clearly as if Dodds had told him in so many words, 'I withdraw the offer.'" If and so far as the above language was intended to suggest that a revocation in fact of an offer without the knowledge of the offeree would avail against an acceptance by the offeree within the prescribed time, it must no doubt be regarded as overruled by subsequent decisions. But the language of the learned judges in Dickinson v. Dodds may well be open to the construction that they treated the question as to the offeree's knowledge of the revocation as wholly one of fact and were satisfied in the case before them that he knew well enough, when he accepted, that the offer had already been withdrawn. But can we hold that knowledge of the offeror's intention to revoke, from whatever source it reaches the offeree, is good notice of revocation? If this is correct the inconvenience might be grave. Suppose a merchant to receive an offer of a consign- ment of goods from a distant correspondent,' with liberty to reserve his answer for some days. Meantime an imauthorized person tells him that the offeror has sold or promised the goods to another. What is he to do? His informant may be right, and then, if he accepts, his acceptance would be worthless. Or his informant may be a gossip or mischief-maker, and if on such authority he refrains from accepting he may lose a good bargain. Such is the real and only difficulty created by Dickinson v. Dodds. The case is no authority for the validity of an uncom- municated revocation: but it does raise a question as to the effect of an unauthorized notice of revocation upon the rights Chap. HI] OFFER AND ACCEPTANCE 59 of the offeree. The answer appears to be that it is open to an offeror, who has revoked an offer without direct communica- tion to the offeree, to show that the offeree knew, from a trust- worthy source, that the offer was withdrawn. The Court would thus decide every such case on the facts presented; and that this is the true explanation of Dickinson v. Dodds is borne out by the later decision in Cartwright v. Hoogsioel," where the facts were almost exactly similar, and which seems to be the only other case in which this point has come up for consideration.* We now come to two sets of rules relating to the serious and definite character with which offer and acceptance must be invested if they are to create legal relations. 7. The offer miLst be intended to create, and capable of creating, legal relations. 54. No intent to create legal relations. In order that an offer may be made binding by acceptance, it must be made in contemplation of legal consequences; a mere statement of intention made in the course of conversation will not consti- tute a binding promise, though acted upon by the party to whom it was made.* In an old case, the defendant said, in con- versation with the plaintiff, that he would give £100 to him who married his daughter with his consent. Plaintiff married defendant's daughter with his consent, and afterwards brought an action on the alleged promise. It was held that it is not reason that the defendant "should be bound by general words spoken to excite suitors." * A stronger illustration is supplied by a recent case." A father writing to the plaintiff who was about to marry his daughter used these words: "She will have a share of what I leave after the death of her mother." This was held by Cozens-Hardy, J., not to be an offer capable of being turned into a promise on marriage taking place, but a mere statement of an intention by the father to give the daughter something at his death.** a (1911) 105 L.T. 628. b Weeks t. Tybald, (1605) Noy, 11. c Farina t. Fickiu, [1900] 1 Ch. 331. d The learned Judge held that if there was a contract it was satisfied by a legacy left to the daughter, which only represented a small share of the father's estate. The student may compare with advantage this case and that of Laver v. Fielder, (1862) 32 Beav. 1, where words addressed to a suitor were held to constitute a promise to leave such a share as the daughter would have been entitled to on intestacy. ' In accord, see (Coleman v. Applegarth, (1887) 68 Md. 21; Frank v. Stratford-Handcock, (1904) 13 Wyo. 37, 67 L.R.A. 571. * A statement of intention of this sort is not a promise. Nor is it an "offer," for the reason that it creates no legal power in the other party. 60 THE FORMATION OF CONTRACT [Chap, m On a like footing stand engagements of pleasure, or agree- ments which from their nature do not admit of being regarded as business transactions. We cannot in all cases decline to regard such engagements as contracts on the ground that they are not reducible to a money value. The acceptance of an invitation to dinner or to play in a cricket match forms an agreement in which the parties may incur expense in the fulfillment of their mutual promises. The damages resulting from breach might be ascertainable, but the courts would probably hold that, as no legal consequences were contem- plated by the parties, no action would lie.^ 55. Vague or ambiguous terms. And an offer must be capable of affecting legal relations. The parties must make their own contract : the courts will not construct one for them out of terms which are indefinite or illusory. A bought a horse from X and promised that "if the horse was lucky to him he would give £5 more or the buying of another horse": it was held that such a promise was too loose and vague to be con- sidered in a court of law." ^ A covenanted with X to retire wholly from the practice of a trade "so far as the law allows": it was held that the a Guthing i. Lynn, (1831) 2 B. & Ad. 232. 1 Words spoken in jest or banter do not constitute a contract. Keller v, Holderman, (1863) 11 Mich. 248; McClurg v. Terry, (1870) 21 N.J. Eq. 225; Theiss v. Weiss, (1895) 166 Pa. 9; Bruce v. Bishop, (1870) 43 Vt. 161; Paulus, Digest XLIV, 7, 3, § 2; German Civ. Code, § 118. Words spoken in anger or excitement may not constitute a contract. Higgins v. Lessig, (1893) 49 111. App. 459. But in either case the offeree must imderstand that there is no real intent to create legal relations. Plate v. Durst, (1896) 42 W.Va. 63: McKinzie v. Stretch, (1893) 53 HI. App. 184. 2 Burks V. Stam, (1896) 65 Mo. App. 455; Clark v. Pearson, (1893) 53 lU. App. 310; Wall's Appeal, (1886) 111 Pa. 460 (promise to provide for another by will too indefinite); Adams v. Adams, (1855) 26 Ala. 272; ("full share" indefinite, "equal share" definite); Fairplay School Tp. v. O'Neal, (1890) 127 Ind. 95 (promise to pay good wages too indefinite). But see Henderson Bridge Co. v. McGrath, (1889) 134 U.S. 260 (promise to "do what is right " may be a promise to pay reasonable compensation); Chichester v. Vass, (1810, Va.) 1 Munf. 98 (promise to do equal justice among children) ; Thompson v. Stevens, (1872) 71 Pa. 161 (promise to give enough so promisee need not work). It should be observed here that where the words and other acts of the parties are so indefinite as to express nothing they are utterly inoperative to create legal relations. But if a performance follows by which one of the parties receives value from the other, such performance is very generally held to operate to create a legal duty of reimbursement to the extent of the value received. This duty is a construction of law and is not the one intended by either party. It is generally described as quasi-contractual. Chap. Ill] OFFER AND ACCEPTANCE 61 parties must fix the limit of their covenant and not leave their agreement to be framed for them by the court." A made a contract with X and promised that if "satisfied with you as a customer" he "would favorably consider" an application for a renewal of the contract: it was held that there was nothing in these words to create a legal obligation.* ^ A communicated with X by telegraphic code, and owing to a mistaken economy of words the parties differed in the con- struction of the contract. Here the party relying on the contract must fail, for the court will not determine a question which the parties should not have left in doubt." ^ 8. Acceptance must he absolute, and must correspond vnth the terms of the offer 56. Inconclusive forms of acceptance. If a contract is to be made, the intention of the offeree to accept must be expressed without leaving room for doubt as to the fact of acceptance, or as to the correspondence of the terms of the acceptance with those of the offer. The forms of difficulty which arise in determining whether or no an acceptance is conclusive, may be said to be three. The alleged acceptance (1) may be a refusal and counter-offer, or a mere statement of fact relating to the proposed transaction: (2) may be an acceptance with some addition or variation of terms: (3) may be an acceptance of a general character, to be limited and defined by subsequent arrangement of terms. a Davies v. Davies, (1886) 36 Ch. D. 359. b Montreal Gas Company v. Vasey, [1900] A.C. 595. e Falck «. WiUiamB, [1900! A.C. 176; Miles v. Haselhurst, (1906) 12 Com. Cas. 8. 1 But see Worthington v. Beeman, (1899) 91 Fed. 232. * In the following cases the court held the promise too vague to be enforced: Sherman v. Kitsmiller, (1827, Pa.) 17 S. & R. 45; Hart v. Georgia R. Co., (1897) 101 Ga. 188; Marble v. Standard Oil Co., (1897) 169 Mass. 653; Young v. FarweU, (1893) 146 LI. 466; Hewlett v. Hewlett, (1897) 115 Mich. 75; Hauser v. Harding, (1900) 126 N.C. 295. United Press v. New York Press Co., (1900) 164 N.Y. 406, held the contract to pay not exceeding three hundred dollars a week for news too indefinite to warrant substantial damages for refusal to receive the news, but awarded nominal damages for a technical breach. If under such a contract the service is rendered and accepted the recovery is in gvantwn meruit. Kennedy v. McKone, (1896) 10 N.Y. App. Div. 88. In Silver v. Graves, (1911) 210 Mass. 26, a recovery was allowed upon a contract to "make it right" for withdrawing from a will contest. The true basis of recovery would seem to be quasi-contract. In Vamey v. Ditmars, (1916) 217 N.Y. 223, a promise to pay "a fair share of profits" was held too vague for enforcement. 62 THE FORMATION OF CONTRACT [Chap. Ill 57. Refusal and coxmter-offer. In the case of Hyde v. Wrench," A offered to sell a farm to X for £1,000. X said he would give £950. A refused, and X then said he would give £1,000, and, when A declined to adhere to his original offer, tried to obtain specific performance of the alleged contract. The court, however, held that an offer to buy at £950 in response to an offer to sell for £1,000 was a refusal and a counter-offer.' An offer once refused is dead and cannot be accepted unless renewed; ^ but an inquiry as to whether the offeror will modify his terms does not necessarily amount to a refusal.* 58. Mere statement of price. The case of Harvey v. Facey," decided by the Judicial Committee, was not one of counter- offer, but of a statement as to price which the intending acceptor chose to treat as an offer. X telegraphed to A, "Will you sell us Bumper Hall Pen? Telegraph lowest cash price, answer paid." A replied by telegram, "Lowest price for Biunper Hall Pen £900." X telegraphed, "We agree to buy Bumper Hall Pen for £900 asked by you." On this correspondence X alleged that a contract had been made for the sale of Bmnper Hall Pen at the price stated by A to be the lowest that he would take. It was held that no contract had been made, that A in stating the lowest price which he would take was not accepting an offer but supplying information, that the third of the telegrams set out above was an offer by X — not the less so because he called it an accept- ance — and that this offer had never been accepted by A.' 59. New terms in acceptance. The acceptance of an offer may introduce terms not comprised in the offer, and in such cases no contract is made, for the offeree in effect refuses the offer and makes a counter-offer of his own. In the case of Jones v. Daniel,^ A offered £1,450 for a prop- a (1840) 3 Beav. 334. b Stevenson t. McLean, (1880) S Q.B.D. 346. c [18931 A.C. 552, d [1894] 2 Ch. 332. 1 Minneapolis & St. Louis Ry. ». Columbus Rolling Mill, (1886) 119 U.S. 149; Egger v. Nesbitt, (1894) 122 Mo. 667; Russell v. Falls Mfg. Co., (1900) 106 Wis. 329; Johnson v. Fed. U. Sur. Co., (1915) 187 Mich. 454. 2 Tinn v. Hoffman, (1873) 29 L.T. (N.S.) 271. » Montgomery Ward & Co. ». Johnson, (1911) 209 Mass. 89 (circular and price list held a mere invitation to submit offers); Moulton v. Ker- shaw, (1884) 59 Wis. 316; Schenectady Stove Co. v. Holbrook, (1885) 101 N.Y. 45; Knight v. Cooley, (1872) 34 Iowa, 218; Aheam v. Ayies, (1878) 38 Mich. 692; Beaupr§ v. Pacific &c. Co., (1874) 21 Minn. 155; Talbot V. Pettigrew, (1882) 3 Dak. 141. The principle is clear, but the correctness of its application in Harvey v. Facey, supra, may well be doubted. Chap. Ill] OFFER AND ACCEPTANCE 63 erty belonging to X, In accepting the offer X enclosed with the letter of acceptance a contract for signature by A. This docu- ment contained various terms as to payment of deposit, date of completion, and requirement of title which had never been suggested in the offer. The court held that there was no con- tract; that it would be equally unfair to hold A to the terms of acceptance, and X to those of the offer. ■ The case of Canning v. Farguhar " is decided substantially, though not so obviously, on the same ground. A proposal for life insurance was made by Canning to the defendant com- pany, and was accepted at a premium fixed in their answers subject to a proviso that "no assurance can take place until the first premium is paid." Before the premium was paid and the policy prepared Canning suffered a serious injury, and the company consequently refused to accept a tender of the pre- mium and to issue the policy. It was held that the company's acceptance of the proposal was really a counter-offer, and that the change in the risk which occurred between this counter-offer and the acceptance which was made by tender of the premium entitled the com- pany to refuse to issue the policy.' 60. Reference to existing terms. In cases where offer or acceptance is couched in general terms, but refers to a con- tract in which the intention of the parties may be more pre- cisely stated, it is important to note whether the terms of such a contract were in existence, and known to the parties, or whether they were merely in contemplation. In the former case the offer and acceptance are made subject to, and inclusive of, the fuller conditions and terms: in the latter case the accept- ance is too general to constitute a contract. a (1886) 16 Q.B.D. 727. * SejTnouT V. Armstrong, (1901) 62 Kans. 720 (acceptance of offer with new term as to price of packing cases); Jacob Johnson Fish Co. v. Hawley, (1912) 150 Wis. 578; Kingsway C. Co. v. Metrop. L.I. Co. (1915, N.Y.) 166. App. D. 384. See Minneapolis & St. Louis Ry. v. Columbia Rolling Mill, supra. Words indicating acceptor's construction of terms of offer do not introduce a new term, if such construction is the reasonable one or if his acceptance is clearly not conditional upon such construction. Kennedy V. Gramling, (1890) 33 S.C. 367. An acceptance is not made conditional by words conveying merely a request. Culton v. Gilchrist, (1894) 92 Iowa, 718. The words "AH sales subject to strikes and accidents" printed on a letter head are not a part of an absolute acceptance written below. Summers v. Hibbard, (1894) 153 HI. 102; Poel v. Brunswick &c. Co., (1915) 216 N.Y. 310. 64 THE FORMATION OF CONTRACT [Chap, III A verbal offer was made to purchase land, the offeror was told that the land must be purchased imder certain printed conditions, and the offer, which was still continued, was accepted "subject to the conditions and particulars printed on the plan." As these were contemplated in the offer a complete contract was thus constituted. " An offer was made to buy land, and "if offer accepted, to pay deposit and sign contract on the caution particulars"; this was accepted, "subject to contract as agreed." The acceptance clearly embodied the terms of the contract mentioned in the offer, and constituted a complete contract. 6i. Reference to future terms. On the other hand, where an offer to sell property was accepted "subject to the terms of a contract being arranged" between the solicitors of the parties, no contract was made. The acceptance was not, in fact, more than an expression of willingness to treat." * " It comes therefore to this, that where you have a proposal or agree- ment made in writing expressed to be subject to a contract being pre- pared, it means what it says; it is subject to and dependent upon a formal contract being prepared. When it is not expressly stated to be subject to a formal contract, it becomes a question of construction whether the parties intended that the terms agreed on should merely be put into form, or whether they should be subject to a new agree- ment, the terms of which are not expressed in detail." '' 62. Questions of construction. There are cases which at first sight may appear to be cases of doubt or difference in the accept- ance of an offer, but really turn out to involve only questions of the admissibility of evidence or the interpretation of terms. a Rossiter «. Miller, (1878) 3 App. Cos. 1124. 6 Filby v. Hounsell, [1896] 2 Ch. 737. c Honeyman «. Marryatt, (1855) 6 H.L.C. 113. d Winn i. Bull, (1877) 7 Ch. D. 29, 32. 1 Mississippi &c. Co. v. Swift, (1894) 86 Me. 248; Sibley v. Felton, (1892) 156 Mass. 273; Brown v. New York Central R., (1870) 44 N.Y. 79; Don- nelly V. Currie Hardware Co., (1901) 66 N.J. 388; Shepard v. Carpenter, (1893) 54 Minn. 153. The following cases held the contract not yet made, because the parties contemplated the execution of a formal document as the vital expression of agreement: Stanton v. Dennis, (1911) 64 Wash. 85; Spinney v. Downing, (1895) 108 Cal. 666; Alexandria B. Co. v. Miloslow- sky, (1915, la.) 149 N.W. 504. But if a complete contract has been agreed upon it is binding, although it is also agreed that it shall subse- quently be reduced to writing. Sanders v. PottUtzer &o. Co., (1894) 144 N.Y. 209; Allen v. Chouteau, (1890) 102 Mo. 309 ;Cohn v. Plumer, (1894) 88 Wis. 622; U.S. v. Carlin Const. Co., (1915, CCA.) 224 Fed. 859; McCon- nell V. Harrell, (1914) 183 Mich. 369; Conner v. Plank, (1915) 25 Cal. App. 516; So. Ry. Co. v. Huntsville L. Co., (1915, Ala.) 67 So. 695; Alexan- der-Amberg & Co. v. Hollis, (1915, Ark.) 171 S.W. 915. See further 15 Columbia Law Review, 700; 8 Harvard Law Review, 498; 29 L.R.A. 431. Chap. HI] OFFER AND ACCEPTANCE 65 Such are cases in which the parties have made a written agree- ment, dependent for its coming into effect on a verbal condition or stipulation. Pym v. Campbell, " and Pattle v. Hornibrook '' are instances of contracts, apparently complete, held in abeyance imtil a verbal condition is fulfilled; and this verbal condition is admitted in evidence as forming part of the written contract. ^ Such, too, are cases in which a contract has to be made out of a correspondence involving lengthy negotiations. The par- ties discuss terms, approach and recede from an agreement; offers are made and met by the suggestion of fresh terms; finally there is a difference; and one of the parties asserts that a contract has been made, and the other that matters have never gone beyond a discussion of terms. Where such a correspondence appears to result, at any moment of its course, in a definite offer and acceptance, it is necessary to ask whether this offer and acceptance include all the terms under discussion. For where the parties have come to terms a subsequent revival of negotiations may amount to a repudiation on one side, and consequent breach, but does not alter the fact that a contract has been made." In the case of an alternative offer by letter to let the whole of an estate, called Minydon, or to sell a portion, the terms of each offer being stated, an acceptance couched in the terms, "I accept your offer of Minydon on the terms named therein," was held to be an acceptance of the offer to let, the two letters making a completed contract.** But these cases turn rather on the meaning to be given to the words of the parties, than on rules of law.^ 9. An offer need not be made to an ascertained person, but no contract can arise until it has been accepted by an ascertained person 63. Offer to all the world. The proposition is best under- stood by an illustration. The offer, by way of advertisement, of a reward for the o (1856) 6 E. & B. 370. b [1897] 1 Ch. 25. c HuBsey v. Home Payne, (1878) 4 App. Cas. 311; Bellamy v. Debenham, (1891) 45 Cai. D. 481; Perry v. SufSelds, [1916] 2 Ch. 187, 191. d Lever v. Koffler, [1901] 1 Ch. 543. 1 Reynolds v. Robinson, (1888) 110 N.Y. 654; Blewitt v. Boorum, (1894) 142 N.Y. 357; Westman v. Krumweide, (1883) 30 Minn. 313. 2 See Sanders v. Pottlitzer &c. Co., (1894) 144 N.Y. 209; Jordan v. Walker, (1908) 154 Mich. 394; Bollenbacher «. Reid, (1908) 155 Mich. 277; Weishut V. Layton, (1915, Del.) 93 Atl. 1057. 66 THE FORMATION OF CONTRACT [Chap. Ill rendering of certain services, addressed to the public at large, becomes a contract to pay the reward so soon as an individual renders the services, but not before. To hold that any contractual obligation exists before the services are rendered, would amount to saying that a man may be bound by contract to an indefinite and unascertained body of persons, or, as it has been expressed, that a man may have a contract with the whole world. This view has never been seriously entertained in English law;" the promise is re- garded as being made, not to the many who migU accept the offer, but the person or persons by whom it is accepted.' The contract may assume a form not so simple. Where competitors are invited to enter for a race, subject to certain conditions, by a committee or other agency, each competitor who enters his name thereby offers, to such other persons as may also compete, an undertaking to abide by the conditions under which the race is run. The offer is made through an agent or a committee to uncertain persons who define themselves by entry imder conditions which are binding on all. Such was the contract made in the case of the Satanita,'' Clarke v. Dun- raven: and such is the case of a lottery where each one of a nimiber of persons unknown to one another places money in the hands of a stakeholder on the terms that the whole simi should be paid to one of them on a given conclusion of an event uncertain at the time." '' 64. Problems and difficulties. Such offers suggest more practical difficulties. 1. Who is entitled as acceptor f The offer maybe susceptible of acceptance by a number of persons. When it is a conditional offer of reward to any person who a The view of Savigny (Obl. 2, § 61) that an obligation arises at once from an offer of this sort, but that performance of the condition can only create a debt of honor, seems to the English lawyer neither logical nor equitable. By "obligation" an English lawyer means a , legal obligation, an obligation that the law will enforce. 6 118951 P. 255; [1897] A.C. 59. c Barclay v. Pearson, [1893] 2 Ch. 154. 1 But even before the conclusion of the contract with a definite person, the power to accept might be held to be irrevocable. See § 51, ante. 2 Competition for prizes. Porter ». Day, (1888) 71 Wis. 296; Harris v. White, (1880) 81 N.Y. 532; Alvord v. Smith, (1878) 63 Ind. 58; DeUer v. Plymouth &c. Soc, (1881) 57 Iowa, 481; Wilkinson v. Stitt, (1900) 175 Mass. 681. And see Vigo Agr. Soc. v. Brumfiel, (1885) 102 Ind. 146. To the present editor the case of the Satanita has seemed to be a decision based upon fiction, the only contract contemplated in fact being one made by each person entering the race with the club or committee, of which contract the other parties involved are mere beneficiaries. This appears to be the view of Professor Holland also, Juris., (10th ed.) p. 250. Chap. Ill] OFFER AND ACCEPTANCE 67 does a specified act, the number of persons who may do the act and satisfy the condition does not appear to affect the validity of the offer." But where there is an offer of reward for the supply of a specified piece of information, the offeror clearly does not mean to pay many times over for the same thing. So where informa- tion has been collected and contributed by various persons the question arises. Which of these has accepted the offer? In Lancaster v. Walsh!' it was held that he who gave the earliest information was entitled to the reward.^ 2. What constitutes acceptance ? Where a constable has given information for which reward has been offered, it may be asked whether he has done more than in the ordinary course of duty he is boxmd to do. It would seem from the case of England v. Davidson,'' where a poUceman not only gave information but collected evidence, and was thereupon held entitled to the re- ward, that imless a police constable does something more than the ordinary course of duty would require, he cannot claim a reward.* But there are more serious difficulties. 3. Is knowledge of the offer essential f Is knowledge of the existence of an offer essential to its acceptance, or can it be accepted by an accidental compliance with its terms? Williams v. Carwardine ^. is authority for sajong that the , motive of compliance is immaterial; it does not seem to be au- j thority for saying that knowledge of the offer is immaterial. I In Fitch V. Snedaker ' it is laid down with clear and con- . vincing argument that knowledge of the offer is essential, but ^ this conclusion is not imiformly accepted in the state courtai,; of America.' a Carlill v. CarboUc Smoke BaU Co., [1893] 1 Q.B. 288. b (1838) 4 M. & W. 16. \ c (1840) 11 A. & B. 856. d (1833) 4 B. Fitch V. Snedaker, (1868) 38 N.Y. 248. See § 29, ante. Dawkins v. Sappington, (1866) 26 Ind. 199, is contra. 68 THE FORMATION OF CONTRACT [Chap. Ill Gibbons v. Proctor " is the only English case which appears to lay down a rule that knowledge of the offer is immaterial. The decision comes to this, that if the offeror gets what he wants he must pay for it, even though the information wanted was supplied in ignorance that a reward was offered, was supplied before the reward was offered, and was supplied by a constable in the ordinary course of his duty. It is impossible to accept this case as an authority. 4. Distinction between offer and invitation to treat. It is often diflScult to distinguish statements of intention which can result in no obligation ex contractu, from offers which admit of accept- ance, and so become binding promises. Such statements may relate to the whole transaction or only to a subordinate part of the transaction. A man annoimces that he will sell goods by tender or by auction, or that he is prepared to pay money under certain conditions: or again, a railway company offers to carry passengers from A to X and to reach X and the inter- mediate stations at certain times. In such cases it may be asked whether the statement made is an offer capable of accept- ance or merely an invitation to make offers and do business; whether the railway company by its pubhshed time-table makes offers which become terms in the contract to carry, or whether it states probabilities in order to iuduce passengers to take tickets. (a) We may note the distinction in the following cases. An invitation to compete for a scholarship does not import a promise that the scholarship will be given to the candidate who obtains the highest marks if examiners report that he is not of sufficient merit to receive the scholarship.* An annoimcement that goods would be sold by tender, un- accompanied by words indicating that they would be sold to the highest bidder, was held to be "a mere attempt to ascertain whether an offer can be obtained within such a margin as the sellers are willing to adopt." " * a (1891) 64 L.T. 594. 6 Rooke «. Dawson, [1895] 1 Ch. 480. c Spencer v. Harding, (1870) L.R. 5 C.P. 561. 1 Aa invitation for bids for construction, etc., is not an offer to award to the lowest bidder. Leskie v. Haseltine, (1893) 165 Pa. 98; Smith v. Mayor, (1853) 10 N.Y. 504; Kelly v. Chicago, (1871) 62 111. 279. The bid is an offer. Even a vote of a committee to accept it is not effective unless officially communicated. Benton v. Springfield, &c. Ass'n, (1898) 170 Mass. 534; Edge Moor Bridge Works v. County of Bristol, (1898) 170 Mass. 628; Peek V. Detroit Novelty Works, (1874) 29 Mich. 313. Chap. Ill] OFFER AND ACCEPTANCE 69 An advertisement by an auctioneer, that a sale of certam articles would take place on a certain day, was held not to bind the auctioneer to sell the goods, nor to make him liable upon a contract to indemnify persons who were put to ex- pense in order to attend the sale. "Unless every declaration of intention to do a thing creates a binding contract with those who act upon it, and in all cases after advertising a sale the auctioneer must give notice of any articles that are with- drawn, we cannot hold the defendant Uable." " * (&) On the other hand we find in the following cases a con- tract made by acceptance of a general offer, such acceptance being signified by performance of its terms. In Warlow v. Harrison * the putting up of property by an auctioneer at a sale, advertised as being "without reserve," was held to constitute an offer which, so soon as the highest bid was made, became a binding contract between the auction- eer and the highest bidder that the goods should be sold to the latter. The law was stated thus by Martin, B. : "The sale was announced by them (the auctioneers) to be 'without reserve.' This, according to all^the cases both at law and in equity, means that neither the vendor nor any person in his behalf shall bid at the auction, and that the property shall be sold to the highest bidder, whether the sum bid be equivalent to the real value or not. " We cannot distinguish the case of an auctioneer putting up property for sale upon such a condition from the case of the loser of property offering a reward,*^ or that of a railway company publishing a time- table stating the times when, and the places to which, the trains nin."^ It has been decided that the person giving the information advertised for, or a passenger taking a ticket, may sue as upon a contract with him. Upon the same principle, it seems to us that the highest bona fide bid- der at an auction may sue the auctioneer as upon a contract that the sale shall be without reserve." * This view of the rights of the highest bidder at an auction was adopted by Cozens-Hardy, J., in the more recent case of Johnston v. Boyes. ^ ^ a Hams v. Nickerson, (1873) L.R. 8 Q.B. 286. b (1858) 1 E. & E. 295. c Thornett 8. Haines, (1846) 15 M. & W. 367. d Denton b. G. N. RaUway Co., (1856) 5 E. & B. 860. e Warlow ». Harrison, (1858) 1 E. & E. 316. / [1899] 2 Ch. 75. In a sale by auction with notice that it is subject to reserve, both the offer by the highest bidder and its acceptance by the auctioneer are conditional upon the reserve price having been reached. M'Manus ». Fortescue, [1907] 2 K.B. 1. 1 Scales ». Chambers, (1901) 113 Ga. 920. » Walsh V. St. Louis &c. Ass'n, (1886J 90 Mo. 459 (advertisement that successful plans in competition would be chosen); Guinzburg v. Downs Co., (1896) 165 Mass. 467 (auction). 70 THE FOKMATION OF CONTRACT [Chap, m In the "Smoke Ball" case" the Carbolic Smoke Ball Com- pany offered by advertisement to pay £100 to any one "who contracts the increasing epidemic influenza colds, or any dis- ease caused by taking cold, after having used the ball three times daily for two weeks, according to the printed directions." It was added that £1,000 was deposited with the Alliance Bank "showing our sincerity in the matter." Mrs. Carlill used the smoke ball as required by the direc- tions; she afterwards suffered from influenza and sued the company for the promised reward. The company was held lia- ble. It was m-ged that a notification of acceptance should have been made to the company. The court held that this was one of the class of cases in which, as in the case of reward offered for information or for the recovery of lost property, there need be no acceptance of the offer other than the performance of the condition. It was fiui;her argued that the alleged offer was an advertisement or puff which no reasonable person would take to be serious. But the statement that £1,000 had been de- posited to meet demands was regarded as evidence that the offer was sincere.* Thus, too, statements made in the time-tables of a railway company must be regarded as sometmng more than a mere inducement to travelers. They have been held to be promises made to each person who accepts the standing offer of the company to carry him for hire. The passenger then becomes entitled to the use of reasonable diligence on the part of the company that its promises as to the hours of arrival and depart- ure shall be performed. * * On the other hand, a bookseller's catalogue, with prices stated against the names of the books, would seem to contain a number of offers. But if the bookseller receives by the same post five or six letters asking for a particular book at the price named, to whom is he boimd? To the man who first posted his letter of acceptance? How is this to be ascertained? The cata- logue is clearly an invitation to do business, and not an offer." ' a [1892] 2 Q.B. 484; (1893) 1 Q.B. (C.A.) 256. b Le Blanche t. L. &N.W. Railway Co., (1876) 1 C.P.D. 286. c Grainger g. Gough, 11896] A.C. 325, 334. 1 See Bull v. Talcot, (1794, Conn.) 2 Root, 119; TarbeU v. Stevens, (1858) 7 la. 163. * Sears v. Eastern R., (1867, Mass.5 14 Allen, 433; Gordon v. Manchester &c. Ry., (1872) 62 N.H. 596; Heirn v. McCaughan, (1856) 32 Miss. 17. See St. Louis &o. Ry. v. Hardy, (1891) 55 Ark. 134. ' Montgomery Ward & Co. v. Johnson, (1911) 209 Mass. 89. See § 68, ante. Chap. Ill] OFFER AND ACCEPTANCE" 71 In all these cases the same question presents itself under various forms. Is there an offer? And, to constitute an offer, the words used, however general, must be capable of applica- tion to specific persons, and must be distinguishable from invitations to transact business, and from advertisement or puffery which does not contemplate legal relations. CHAPTER IV Form and Consideration HISTOEICAL INTRODUCTION 65. Form or consideration necessary. Offer and accept- ance bring the parties together, and constitute the outward semblance of contract; but most systems of law require some further evidence of the intention of the parties, and in default of such evidence refuse to recognize an obligation. In English law this evidence is supplied by form and consideration; some- times one, sometimes the other, sometimes both are required to be present in a contract to make it enforceable. By form we mean some peculiar solemnity attaching to the expression of agreement which of itself gives efficacy to the contract; by consideration we mean some gain to the party making the promise, arising from the act or forbearance, given or prom- ised, of the promisee. 66. History of formal and informal promises. Alike in English and Roman law, form, during the infancy of the sys- tem, is the most important ingredient ia contract. The courts look to the formalities of a transaction as supplying the most obvious and conclusive evidence of the intention of the parties; the notion of consideration, if not imknown, is at any rate imperfectly developed. This is no place for an antiquarian discussion, however interesting, but we may say that English law starts, as Roman law may perhaps have started, with two distinct conceptions of contract. One, that a promise is binding if expressed in form of a certain kind: the other, that the acceptance of benefits of a certain kind imports a liability to repay them. The history of the Roman contracts is difficult and obsciu-e. The theory of Sir Henry Maine, that they de- veloped out of conveyance in an order of moral progression, has long been abandoned. But under many varieties of proce- dure we detect two leading ideas — the binding character of an undertaking clad in solemn form, and the readjustment of proprietary right where money or goods had been lent for consumption or use. In English law we find that before the end of the thirteenth century there were two liabiUties analo- Chap. IV] FORM AND CONSIDERATION 73 gous in character to those I have just described: one formal, the promise mider seal, which was looked on as something in the natm-e of a present grant: > one informal, arising from sale and delivery of goods, or loan of money, in which consid- eration has passed on one side, and the liability was expressed in the action of debt. Beyond this, the idea of enforcing an informal promise, simply because a benefit was accruing or was about to accrue to the promisor by the act or forbearance of the promisee, does not appear to have been entertained before the middle or end of the fifteenth century. 67. The formal contract in English law. The formal con- tract of English law is the contract under seal. Only by the use of this form could a promise, as such, be made binding, until the doctrine of consideration began to prevail. We have to bear in mind that it is to the form only that the courts look in upholding this contract; the consensus of the parties has not emerged from the ceremonies which surrounded its expres- sion. Coiu'ts of law would not trouble themselves with the in- tentions of parties who had not couched their agreement in the solemn form to which the law attached legal consequences. Nor, on the other hand, where form was present would they demand or admit ivather evidence as to intention. It is probably due to the influence of the court of chancery that, later on, the common-law courts began to take account of the intention of the parties. The idea of the importance of form thenceforth undergoes a curious change. When a con- tract comes before the courts, evidence is required that it expresses the genuine intention of the parties; and this evidence is found either in the solemnities of the contract under seal, or in the presence of consideration, that is to say, in some bene- fit to the promisor or loss to the promisee, granted or incurred by the latter in return for the promise of the former. Gradually consideration comes to be regarded as the important ingredient in contract, and then the solenmity of a deed is explained as making a contract binding because it "imports consideration," though in truth there is no question of consideration; ^ it is the form which brings about legal consequences. 1 If this means a conveyance of a specific res, creating property in the promisee, it is the most obvious fiction. The relations created by the sealed promise were contractual and in personam ; and thoughtful lawyers, then as now, could not fail to perceive this. ^ The most enlightening case on this point is Sharington v. Strotton (1564;, as reported with arguments of counsel in 1 Plowden, 298. See also Jackson v. Alexander, (1808, N.Y.) 3 Johns. 484. 74 THE FORMATION OF CONTEACT [Chap. IV But we must return to the informal promise. 68. The informal promise. I have said that the only con- tracts which English law originally recognized, were the formal contract under seal, and the informal contract in which what we now call consideration was executed upon one side. How then do we arrive at the modem breadth of doctrine that any promise based upon consideration is binding upon the promisor? This question resolves itself into two others. How did informal executory contracts become actionable at all? How did con- sideration become the universal test of their actionability? 69. Remedies for breach of promise. To answer the first question we must look to the remedies which, in the early his- tory of our law, were open to persons complaining of the breach of a promise, express or implied. The only actions of this nature, during the thirteenth and fourteenth centiuies, were the actions of covenant, of debt, and of detinue. Covenant lay for breach of promises made under seal; debt for liquidated or ascertained claims, arising either from breach of covenant, or from non-payment of a simi certain, due for goods suppUed, work done, or money lent; detinue" lay for the recovery of specific chattels kept back by the defendant from the plain- tiff. These were the only remedies based upon contract. An executory agreement therefore, unless made under seal, was remediless. The remedy found for such promises is a curious instance of the shifts and tiurns by which practical convenience evades technical rules. The breach of an executory contract, until comparatively recent times, gave rise to a form of the action of trespass on the case. This was a development of the action of trespass: trespass lay for injuries resulting from immediate violence: trespass on the case lay for the consequences of a wrongful act, and proved a remedy of a very extensive and flexible character.'' 70. Origin of action of assumpsit. Note the process whereby this action came to be applied to contract. It lay originally for a malfeasance, or the doing an act which was wrongful ab initio : it next was applied to a misfeasance, or improper a Detinue has been the subject of contention from the thirteenth century as to whether it is founded on contract or in wrong {Pollock and Maitland, Hist, of English Law (2d ed.), ii. 180). In our own time the action of detinue has been decided to be an action of tart. Bryant t. Herbert, (1878) 3 C.P.D. 389. Detinue is in fact founded in bailment, but the contract of bailment imposes general common-law duties the breach of which may be treated, and should be treated, as a wrong. The judgment of Collins, L.J., in Turner «. Stallibrass, [1898) 1 Q.B. [C.A.] 59, states this clearly. b Spence, Chancery Jurisdict. i. 241. Chap. IV] FORM AND CONSIDERATION 75 conduct in doing what it was not otherwise wrongful to do, and in this form it was applicable to promises part-performed and then abandoned or negligently executed to the detriment of the promisee: finally, and not without some resistance on the part of the courts, it came to be applied to a mere non-feasance, or neglect to do what one was boimd to do." It was in this form that it adapted itself to executory contracts. The first reported attempt so to apply it was in the reign of Henry IV, when a carpenter was sued for a non-feasance because he had under- taken (qimre assumpsisset) to build a house and had made default. The judges in that case held that the action, if any, must be in covenant, and it did not appear that the promise was imder seal.'' But in course of time the desire of the common-law courts to extend their jurisdiction, and their fear lest the chancery by means of the doctrine of consideration, which it had already applied to the transfer of interests in land, might enlarge its jurisdiction over contract, produced a change of view. Early in the sixteenth century it was settled that the form of trespass on the case known henceforth as the action of assumpsit would lie for the non-feasance, or non-performance of an executory contract; and the form of writ by which this action was com- menced, perpetuated this peculiar aspect of a breach of a promise until recent enactments for the simplification of procedure. It is not improbable that the very difficulty of obtaining a remedy for breach of an executory contract led in the end to the breadth and simplicity of the law as it now stands. If the special actions ex contractu had been developed so as to give legal force to informal promises, they might have been applied only to promises of a particular sort: a class of contracts similar to the consensual contracts of Roman law, privileged to be informal, would then have been protected by the courts, as exceptions to the rule that form or executed consideration was needed to support a promise. But the conception that the breach of a promise was some- thing akin to a wrong — the fact that it could be remedied only by a form of action which was originally applicable to wrongs — had a somewhat peculiar result. The cause of action was the non-performance of an undertaking; not the breach of a particular kind of contract; it was therefore of universal a Reeves (ed. Finlason), ii. 396, 396. 6 Pollock (8th ed.), p. 148. 76 THE FOEMATION OF CONTRACT [Chap. IV application. Thus all promises would become binding, and English law avoided the technicalities which must needs arise from a classification of contracts. Where all promises may be actionable it follows that there must be some universal test of actionability, and this test was supplied by the doctrine of consideration. 71. Origin of consideration as a test of actionability is uncer- tain. It is a hard matter to say how consideration came to form the basis upon which the vahdity of informal promises might rest. Probably the "quid pro quo" which furnished the ground of the action of debt, and the detriment to the prom- isee on which was based the dehctual action of assumpsit, were both merged in the more general conception of consid- eration as it was developed in the chancery. For the Chancellor was wont to inquire into the intentions of the parties beyond the form, or even in the absence of the form in which, by the rules of common law, that intention should be displayed, and he would find evidence of the mean- ing of men in the practical results to them of their acts or promises. It was thus that the covenant to stand seised and the bargain and sale of lands were enforced in the chancery before the Statute of Uses; and the doctrine once appHed to simple contract was foimd to be of great practical con- venience. When a promise came before the courts they asked no more than this, "Was the party making the promise to gain anything from the promisee, or was the promisee to sus- tain any detriment in return for the promise?" if so, there was a "quid pro quo" for the promise, and an action might be maintained for the breach of it." 72. Gradual growth of doctrine. So silent was the develop- ment of the doctrine as to the universal need of consideration for contracts not under seal, and so marked was the absence of any express authority for the rule in its broad and simple a In the foregoing historical sketch I have refrained from citing authorities. To do so would encumber with detail a part of my book in which brevity is essential to the general plan. I may now refer the student to the chapter on Contract in the History of English Law, by Pollock and Maitland (2d ed.), vol. ii, pp. 184-233, a storehouse of learning upon the subject.* * See also Ames, " History of Assumpsit," 2 Harvard Law Review, 1, 53; 3 Essays in Anglo-Amer. Leg. Hist. 269; Holmes, The Common Law, 285; Salmond, Hist, of Cent. 3 L.Q.R. 166, 3 Essays in Anglo-Amer. Leg. Hist. 320; Barbour, Hist, of Cont. in Early Eng. Equity, 4 Oxford Studies in Social and Legal History; Henry, "Consideration in Contracts," (1917) 26 Yale Law Journal, 664. Chap. IV] FORM AND CONSIDERATION 77 application, that Lord Mansfield in 1765 raised the question whether, in the case of commercial contracts made in writing, there was any necessity for consideration to support the prom- ise. In the case of Pillans v. Van Mierop " he held that consid- eration was only required as evidence of intention, and that where such evidence was effectually supplied in any other way, the want of consideration would not affect the validity of a parol promise. This doctrine was emphatically disclaimed in the opinion of the judges delivered not long afterwards in the House of Lords, in Rann v. Hughes.''^ The logical complete- ness of our law of contract as it stands at present " is apt to make us think that its rules are inevitable and must have existed from all time. To such an impression the views set forth by Lord Mansfield in 1765 are a useful corrective. CLASSIFICATION OF CONTRACTS 73. Contracts are formal or simple. English law recognizes only two kinds of contract, formal and simple: the deed or contract under seal, and the contract which depends for its validity on the presence of consideration. The legislature has, however, imposed upon some of these simple contracts the necessity of some kind of form, either as a condition of their existence or as a requisite of proof, and these stand in an in- termediate position between the deed to which its form alone gives legal force, and the simple contract which rests upon con- sideration and is free from the imposition of any statutory form. In addition to these a certain class of obligation has been imported into the law of contract under the title of con- tracts of record, and though these obligations are wanting in the principal features of contract, it is necessary, in deference to established authority, to treat of them here. 74. Classification. Formal and simple contracts may then be further classified as follows: a (1765) 3 Burr. 1663. b (1778) 7 T.R. 350. ' See also Cook v. Bradley, (1828) 7 Conn. 57. " This assumes altogether too much for the law as it stands to-day. As said by Holmes ("Path of the Law," 10 Harvard Law Review, 466), "the logical method and form flatter that longing for certainty and for repose which is in every human mind. But certainty is generally an illusion, and repose is not the destiny of man." The causes and considerations that will induce courts to enforce a promise are no more certain now than in the daj^ of Lord Mansfield or the days of the Year Books. 78 THE FORMATION OF CONTRACT [Chap. IV A. Formal. i.e., dependent for ("1. Contracts of record. their validity upon their form. C 2. Contracts under seal. !: B. Simple. i.e., dependent for their validity upon the pres- ence of con- sideration. ' 3. Contracts required by law to be in some form other than under seal. 4. Contracts for which no form is required. It will be best to deal first with the essentially forma,l con- tracts, then with those forms which are superimposed upon certain simple contracts, and then with consideration, the req- uisite common to all simple contracts. I. FORMAL CONTRACT 1. Contracts of record 75. Kinds of contracts of record. The obligations which are styled contracts of record are judgment and recognizance." 76. Judgment. And first as to judgment. The proceedings of courts of record are entered upon parchment rolls, and upon these an entry is made of the judgment in an action, when that judgment is final. A judgment awarding a sum of money to one of two litigants, either by way of damages or for costs, lays an obligation upon the other to pay the sum awarded. How it originates. Such an obligation may be the final re- sult of a lawsuit when the court pronounces judgment; ^ or the a Statutes Merchant and Staple, and Heoognizances in the nature of Statute Staple, are contracts of record long Bince obsolete; they were once important, because they were acknowledgments of debt, which, when duly made, created a charge upon the lemda of the debtor. • "A domestic judgment is a contract of record; it is the highest form of obligation." Barber v. International Co., (1902) 74 Conn. 652, 656. A judgment by a United States court stands on the same basis in any state as if rendered by a court of that state. Tumbull v. Payson, (1877) 95 U.S. 418; Oceanic &c. Co. v. Compania T. E., (1892) 134 N.Y. 461. But a judgment is not a contract within the meaning of the clause in the United States Constitution forbidding a state to pass any law impairing the obligation of contracts (Art. i, § 10), whether the judgment be founded on tort [Louisiana v. Mayor, (1883) 109 U.S. 285] or contract [Morley v. Lake Shore &c. Ry., (1892) 146 U.S. 162]. See also O'Brien ». Young, (1884) 95 N.Y. 428. Nor is it a contract which another state is bound to enforce in contravention of its own policy. Anglo-American Prov. Co. v. Davis Prov. Co., (1902) 169 N.Y. 506. The term "contract" as used in a statute may be construed to include Chap. IV] FORM AND CONSIDERATION 79 parties may agree to enter judgment in favor of one of them.^ This may be done before litigation has commenced or while it is pending; and it is done by a contract of a formal character. A warrant of attorney may be an authority from one party to the other to enter judgment upon terms settled; ^ a cognovit actionem is an acknowledgment by one party of the right of the other in respect of a pending dispute, and confers a similar power." Characteristics. The characteristics of an obligation of this nature may be shortly stated as follows: 1. Its terms admit of no dispute, but are conclusively proved by production of the record. * 2. So soon as it is created the previously existing rights with which it deals merge, or are extinguished in it: for in- stance, A sues X for breach of contract or for civil injury: judgment is entered in favor of A either by consent or after a Leake, Contracts (4th ed.)i 105, "judgment" where the legislative intent is to make a distinction between actions ex contractu and actions ex delicto. First Nat. Bk. v. Van Vooris, (1895) 6 S. Dak. 648; Moore v. Nowell, (1886) 94 N. Car. 265. A fcyrtiari, ii the legislative phrase is "implied contract." Gutta Percha Co. v. Mayor, (1888) 108 N.Y. 276. ' " Consent judgments are contracts in the most solemn form, sanctioned by the court, and cannot be collaterally attacked." Bank v. Board of Commissioners, (1898) 90 Fed. 7, 12. » A warrant of attorney to obligee to confess judgment against the obligor is strictly construed. National Exchange Bank v. Wiley, (1904) 195 U.S. 257. • A domestic judgment rendered by a court having jurisdiction is con- clusive. Simpson v. Hart, (1814, N.Y.) 1 Johns. Ch. 91; Morse v. Elms, (1881) 131 Mass: 151; Chouteau v. Gibson, (1882) 76 Mo. 38; Cromwell v. County of Sac, (1876) 94 U.S. 351. Under the' provision of the United States Constitution (Art. iv. § 1) requiring one state to give full faith and credit to the records and judicial proceedings of every other state, a judgment of one state authenticated in the manner prescribed by Congress (U.S. Rev. St. § 906) is conclusive in any other state unless impeached for want of jurisdiction in the court rendering it. Christmas v. Russell, (1866, U.S.) 5 Wall. 290; Thompson v. Whitman, (1873, U.S.) 18 Wall. 457; Hanley v. Donoghue, (1885) 116 U.S. 1. It may be impeached for want of jurisdiction. Rnowles v. Gas- light Co., (1873, U.S.) 19 Wall. 58; Hall v. Lanning, (1875) 91 U.S. 160; Gilman v. Oilman, (1878) 126 Mass. 26. A judgment of a foreign country is not conclusive in the United States if by the laws of the covmtry rendering it a judgment of one of our courts is not conclusive there. Hilton v. Guyot, (1895) 159 U.S. 113. But if by the law of the country rendering the judgment a judgment by one of our courts would be allowed full and conclusive effect, the foreign judgment can be im- peached here only for want of jurisdiction or for fraud. Ritchie v, McMullen, (1895) 169 U.S. 235; Fisher v. Fielding, (1895) 67 Conn. 91. See Tourigny V. Houle, (1896) 88 Me. 406. 80 THE FORMATION OF CONTRACT [Chap. IV trial: A has no further rights in respect of his cause of action, he only becomes creditor of X for the sum awarded.' 3. Such a creditor has certain advantages which an ordinary creditor does not possess. He has a double remedy for his debt; he can have execution levied upon the personal property of the judgment debtor and so can obtain directly the sum awarded; he can also bring an action for the non-fulfillment of the obli- gation.2 For this purpose the judgment not only of a court of record," but of any court of competent jiurisdiction, British or foreign, other than a county court,* is treated as creating an obligation upon which an action may be brought for money due.'' 3 Before the Judgments Act, 1864 (27 and 28 Vict. c. 112), the judgment creditor had, during the lifetime of the debtor, a charge upon his lands; but since the passing of that statute lands are not affected by a judgment until they have been formally taken into execution.^ 77. Recognizances. Recognizances are aptly described as "contracts made with the Crown in its judicial capacity.'"^ A a The essential features of a court of record are (1) that its " acts and judicial proceedings are enrolled for a perpetual testimony," (2) that it can fine or imprison for contempt. Stephen, Comm. (15th ed.), iii, pp. 314-5. & 51 & 52 Vict. c. 43, § 63. If action could be brought in a superior court on a county court judgment the cheap remedy which county courts are intended to give would become expensive. Berkeley o. Elderkin, (1853) 1 E. and B. 805. c Grant o. Easton, (1883) 13 Q.B.D. 302, 303. d Pollock, (8th ed.), p. 152. 1 A domestic judgment merges the cause of action litigated. Miller ». Covert, (1828, N.Y.) 1 Wend. 487; Alie v. Nadeau, (1899) 93 Me. 282; Hart V. Seymour, (1893) 147 111. 598, 620. But it must be the same cause of action. Vanuxem v. Burr, (1890) 151 Mass. 386; Allen v. Colliery Engi- neers' Co., (1900) 196 Pa. 612; Barber v. Kendall, (1899) 158 N.Y. 401. A judgment by a sister state stands on the same basis as to merger: upon such judgments the plea must be nvi tiel record and not nil debet. Mills V. Duryee, (1813, U.S.) 7 Cranch,481; Hampton v. M'Connel, (1818, U.S.) 3 Wheat. 234; Andrews v. Montgomery, (1821, N.Y.) 19 Johns. 162; Barnes v. Gibbs, (1865) 31 N.J. L. 317. Foreign judgments do not create a merger: the plea of nil debet is allowed. Tourigny v. Houle, (1896) 88 Me. 406; Eastern Townships Bank v. Beebe, (1880) 53 Vt. 177. ' The action is in debt. Runnamaker v. Cordray, (1870) 64 111. 303. The double remedy of execution on the judgment and action on the judg- ment may be pursued simultaneously. Moor v. Towle, (1864) 38 Me. 133; Gushing v. Arnold, (1845, Mass.) 9 Met. 23. ' See preceding notes as to foreign and domestic judgments. * In most of the states a judgment duly docketed is a lien on the debtor's real estate within the county where so docketed. Freeman on Judgments, § 339; Black on Judgments, § 398; Hutcheson v. Grubbs, (1885) 80 Va. 251. Judgments in the Federal courts follow the law of the state where rendered. Act of Aug. 7, 1888, 25 St. at L. 357, 1 Supp. Rev. St. U.S. 602. . Chap. IV] FORM AND CONSIDERATION 81 recognizance is a writing acknowledged by the party to it before a judge or officer having authority for the purpose, and enrolled in a court of record. It usually takes the form of a promise, with penalties for the breach of it, to keep the peace, to be of good behavior, or to appear at the assizes. ' The following is an example: "Be it remembered, that on , A.B. of , comes into the King's Bench Division of the High Court of Justice before me. one of His Majesty's Justices, and acknowledges to owe our Sovereign Lord the King the sum of £ , to be levied upon his goods and chattels, lands and tenements, to His Majesty's use upon condition that if the said A.B. shall be of good behaviour for the space of , to be computed from and after , and keep the peace towards all His Majesty's liege subjects, and especially towards CD. and not depart that Court without leave, then this recognizance to be void or else to remain in fuU force." " 79. Not true contracts. There is little of the true nature of a contract in the so-called contracts of record. Judgments are obligations dependent for their binding force, not on the consent of the parties, but upon their direct promulgation by the sovereign authority acting in its judicial capacity.^ Recog- nizances are promises made to the sovereign, with whom, both by the technical rules of English law and upon the theories of jurisprudence, the subject cannot contract. We need consider these obligations no further. o Crown Office Rules 1906, Appendix, Form 198. 1 See State of Maine v. Chandler, (1887) 79 Me. 172, for a recognizance in a criminal case. " It is an obligation of record foxmded upon contract, and entered into by the recognizors upon certain conditions, upon the breach of which the recognizance became forfeited, and an absolute debt of record, in the nature of a judgment, was created, and upon which scire facias properly hes for the recovery of the forfeiture." " A recognizance is a debt confessed to the state which may be avoided upon the conditions stated. At common law the forfeiture of the recogniz- ance was equivalent to a judgment." Smith v. Collins, (1889) 42 Kans. 259. Unless the statute expressly so requires, it need not be signed but is acknowledged in open court. McNamara v. People, (1899) 183 111. 164. It must be distinguished from a bail-bond. State v. McGuire, (1889) 42 Minn. 27; People v. Barrett, (1903) 202 HI. 287, 297. An action of debt hes upon a recognizance. Green v. Ovington, (1819, N.Y.) 16 Johns. 55; Bodine v. Commonwealth, (1854) 24 Pa. 69. Or scire facias. Bodine v. Comm. supra; McNamara v. People, supra. Infancy is not a defense by the principal. State v. Weatherwax, (1874) 12 Kans. 463. 2 It is now customary to classify judgments among quasi-contracts or non-contract debts. — - 82 THE FORMATION OF CONTRACT [Chap. IV 2. Contract under seal 80. The contract iinder seal. The only formal contract of English law is the contract under seal, sometimes also called a deed and sometimes a specialty. It is the only formal contract, because it derives its validity neither from the fact of agree- ment, nor from the consideration which may exist for the promise of either party, but from the form in which it is ex- pressed. Let us then consider (1) how the contract imder seal is made; (2) in what respects it differs from simple contracts; (3) under what circmnstances it is necessary to contract under seal. (1) Haw a contract under seal is made 81. Formalities. A deed must be in writing or printed, on paper or parchment." It is often said to be executed, or made conclusive as between the parties, by being "signed, sealed, and delivered." (1) Of these three things there is some doubt as to the necessity of a signature,' though no one, unless am- bitious of giving his name to a leading case, would omit to sign a deed.' (2) But that which identifies a party to a deed with the execution of it is the presence of his seal; ^ that which a Sheppard, Touchstone, 53. 6 Coocb v. Goodman, (1842) 2 Q.B. 597. ' Signature held not necessary in Taiinton v. Pepler, (1820) 6 Maddock, 166; Cherry v. Heming, (1849) 4 Exoh. 631. ' A seal at common law is an impression upon wax or other adhesive substance. Warren v. LjTich, (1809, N.Y.) 5 Johns. 239. Some courts still regard this as the only valid seal unless some other form is prescribed by statute. Solon v. Williamsburgh Sav. Bk., (1889) 114 N.Y. 122; Bates v. Boston &o. R., (1865, Mass.) 10 Allen, 251. In other jurisdictions there has been a relaxation of the rule in favor of any impression, mark or pen scroll intended for a seal. Pierce v. Indseth, (1882) 106 U.S. 646; Jackson- ville R. V. Hooper, (1896) 160 U.S. 514; Lorah v. Nissley, (1893) 156 Pa. 329; Underwood v. DoUins, (1871) 47 Mo. 259. In many states it is pro- vided by statute that a scroll or other device with the pen shall be suflBcient. Stimson, Am. St. Law, §§ 1564r-65. In New York the word "seal" or the letters "L. S." (locus sigilli), or anything afiSxed by an adhesive substance, may be used. N.Y. Statutory Construction Law, § 13. A recital of the seal in the instrument is generally held to be unnecessary. Lorah v. Nissley, supra; Eames v. Preston, (1858) 20 111. 389; Wing v. Chase, (1853) 35 Me. 260; Osborn v. Kistler, (1878) 35 Oh. St. 99. But some states require it. Bradley Salt Co. v. Norfolk Imp. Co., (1897) 95 Va. 461; Blackwell v. Ham- ilton, (1872) 47 Ala. 470. Some do not require it in the case of a common law seal but do in the case of a pen-scroll seal. Alt v. Stoker, (1894), 127 Mo. 466. But such a recital if present may estop the maker from denying that he intended to execute a sealed instrument. Metropolitan Life Ins. Co. V. Bender, (1891) 124 N.Y. 47. Or if broad enough in its terms may even estop the grantee in a deed who does not sign. Atlantic Dock Co. v. Leavitt, (1873) 54 N.Y. 35. But if a seal is unnecessarily used it maybe discarded as surplusage. Bridger v. Goldsmith, (1894) 143 N.Y. 424. Chap. IV] CONTRACT UNDER SEAL 83 makes the deed operative, so far as he is concerned, is the fact of its delivery by him.' (3) Delivery is effected either by actually handing the deed to the other party to it, or to a stranger for his benefit, or by words indicating an intention that the deed should become operative though it is retained in the possession of the party executing."'' In the execution of a deed seals are commonly aflHxed beforehand, and the party executing the deed signs his name, places his finger on the seal intended for him, and utters the words "I deliver this as my act and deed." Thus he at once identifies himself with the seal, and indicates his intention to deliver, that is, to give operation to the deed. 82. Escrow. A deed may be delivered subject to a condition; it then does not take effect until the condition is performed: during this period it is termed an escrow, but immediately upon the fulfillment of the condition it becomes operative and acquires the character of a deed. There is an old rule that a deed, thus conditionally delivered, must not be delivered to one who is a party to it, else it takes effect at once, on the ground that a delivery in fact outweighs verbal conditions. But the modern cases appear to show that the intention of the parties prevails if they clearly meant the deed to be delivered con- ditionally.* 3 a Xenos v. Wickham, (1867) L.R. 2 RX. 296. h Sheppard, Touchetone, 59; London Freehold Co. v. Lord SufBeld, [1897] 2 Ch. at p. 621. 1 A deed is effective from the day of its delivery, not from the day of its date., Stone v. Bale, (1693) 3 Lev. 348; Y.B. 34 Lib. Ass. pi. 7; Goddard'a Case, (1584) 2 Co. Rep. 4b. 2 Gorham's Adm'r v. Meacham's Adm'r, (1891) 63 Vt. 231. "Delivery may be effected by words without acts, or by acts without words, or by both acts and words." Ruckman t'. Ruckman, (1880) 32 N.J. Eq. 259, 261; Jordan v. Davis, (1884) 108 111. 336; Johnson v. Gerald, (1897) 169 Mass. 500; Thoroughgood's Case, (1612) 9 Co. Rep. 136b (words not necessary); Shelton's Case, (1582) Cro. EUz. 7; Chamberlain v. Stanton, (1588) Cro. Eliz. 122. Mere intention is insufficient. Bush v. Genther, (1896) 174 Pa. 154; Babbitt v. Bennett, (1897) 68 Minn. 260. Acceptance of the deed has also been held to be a requisite. Meigs v. Dexter, (1898) 172 Mass. 217; Bowen v. Prudential Ins. Co., (1913) 178 Mich. 63. CcrrOra, Roberts v. Security Co., [1897] 1 Q.B. 111. The validity of a delivery of any formal document is determined by the same rules, whether it is a sealed instrument or not. See Sarasohn v. Kamaiky, (1908) 193 N.Y. 203 (delivery of a certified copy, or counterpart, of a written contract). Notice of the receipt of the sealed document, and of the covenantee's assent thereto is not necessary. U.S. Fidelity Co. v. Riefler, (1915) 239 U.S. 17. ' Delivery of a deed or conveyance of lands cannot be made in escrow to the grantee. Worrall v. Munn, (1851) 5 N.Y. 229; Braman «. Bingham, (1863) 26 N.Y. 483; Baker v. Baker, (1896) 159 111. 394; Fairbanks v. Metcalf, (1811) 8 Mass. 230; Darling v. Butler, (1891) 45 Fed. 332. This 84 THE FORMATION OF CONTRACT [Chap. IV 83. Indenture and Deed Poll. The distinction between a deed poll and an indenture is no longer important since 8 & 9 Vict. c. 106, § 5. Formerly a deed made by one party had a polled or smooth-cut edge, a deed made between two or more parties was copied for each on the same parchment, and the copies cut apart with indented edges, so as to enable them to be identified by fitting the parts together. Such deeds were called indentures. An indented edge is not now necessary to give the effect of an indenture to a deed purporting to be such. (2) Characteristics of contract under seal 84. Estoppel. Estoppel is a rule of evidence whereby a man is not allowed to disprove facts in the truth of which he has by words or conduct induced others to believe, knowing that they might or would act on such belief. This rule of evidence is of strict application to statements made under seal. Recitals and other statements in a deed, if express and clear, are con- clusive against the parties to it in any litigation arising upon the deed." "Where a man has entered into a solemn engage- ment by and under his hand and seal as to certain facts, he shall not be permitted to deny any matter he has so asserted." * ' a Onward Building Society c. Smithson, [1893] 1 Ch. 1. b Tatinton, J., in Bowman t. Taylor, (1834) 2 A. & E. 278. rule is generally extended to other specialties. Easton v. DriscoU, (1893) 18 R.1. 318; Jones v. Shaw, (1878) 67 Mo. 667; Ordinary y. Thatcher, (1879) 41 N.J. L. 403. But some states confine the rule to deeds relating to lands. Blewitt V. Boorum, (1894) 142 N.Y. 357. In Hawksland v. Gatchel, (1600, Q.B.) Cro. Eliz. 835, it was held that if the deed is delivered to the grantee in escrow, it is not the grantor's deed until the condition is performed, be- cause the intention is clear. Contra: Whyddon's Case, (1697, C.B.) Cro. Eliz. 520; Williams v. Green, (1601, C.B.) Cro. Eliz. 884; Thoroughgood's Case, (1610) 9 Co. Rep. 136b ("the law respects the delivery to the party himself and rejects the words which will make the express delivery to the party, upon the matter no delivery"). See in full agreement with the text, 4 Wigmore, Evidence, § 2408. 1 Estoppel by deed. Gibson v. Lyon, (1885) 115 U.S. 439; Johnson v. Thompson, (1880) 129 Mass. 398; Orthwein v. Thomas, (1889) 127 111. 554; Metropolitan Life Ins. Co. v. Bender, (1891) 124 N.Y. 47; Atlantic Dock Co. V. Leavitt, (1873) 54 N.Y. 35. "In the absence of fraud, neither inadequacy nor failure to pay the consideration named in a specialty, can be shown for the purpose of defeating it. The consideration may be explained. It may be shown to be not paid at all, without any effect upon the validity of the instrument. If partly or wholly unpaid, the instrument, under the circumstances, will be construed as containing a promise, by implication, to pay, which may be enforced." Bibelhausen v. Bibelhausen, (1915) 159 Wis. 365. See to same effect: Jackson v. Alexander, (1808, N.Y.) 3 Johns. 483; Roberts v. Security Co., [1897] 1 Q.B. Ill; Higdon v. Thomas, (1827, Md.) 1 Harr. & G. 139, 145. Chap. IV] CONTKACT UNDER SEAL 85 An insurance company disputed payment on a life policy on the ground of misrepresentation made by the assured in the proposal which was recited in the policy. It was found as a fact that the proposal was not made by the assured, and the company then contended that if there was no proposal there could be no poUcy. The court held that the company, by issuing a policy in which the proposal was recited and by receiving premiums, were estopped from denying the existence of the proposal." 85. Merger. Where two parties have made a simple contract for any purpose, and afterwards have entered iato an identical engagement by deed, the simple contract is merged in the deed and becomes extinct. This extinction of a lesser in a higher security, like the extinction of a lesser in a greater interest in lands, is called merger.^ 86. Limitation of actions. A right of action arising out of simple contract is barred if not exercised within six years. A right of action arising out of a contract under seal is barred if not exercised within twenty years. ^ These general statements must be taken with some quali- fications to be discussed hereafter.'^ 87. Remedies against debtor's estate. If a man dies leav- ing debts unpaid, those creditors whose rights are evidenced by deed had, and still have, some advantages which are not possessed by creditors whose rights rest upon simple con- tract.^ In administering the personal estate of a testator or intestate person, creditors by specialty were formerly entitled to a priority over creditors by simple contract. Their privilege in this respect is taken away by 32 & 33 Vict. c. 46. The creditor by specialty had alstf at one time an advantage in dealing withthe real estate of the debtor. • - o Pearl Life Insurance Co. v. Johnson, [1909] 2 E.B. 288. 5 See § 433, post. Only the parties to a sealed instrument can sue or be sued upon it. Briggs V. Partridge, (1876) 64 N.Y. 357. But this rule can have no effect where all distinction between sealed and unsealed instruments is abolished. J. B. Streeter Co. v. Janu, (1903) 90 Minn. 393. And see also § 293, post. ' Clifton V. Jackson Iron Co., (1889) 74 Mich. 183; Schoonmaker v. Hoyt, (1896) 148 N.Y. 425. See § 423, post. ' The period varies in the United States from ten to twenty years. Wood on Limitation of Actions, § 31, and Appendix. ' In the American states generally specialties are given no preference over simple contracts in the administration of estates. 2 Kent, Comm. 416-19. 86 THE FORMATION OF CONTRACT [Chap. IV If the debtor bound himself and his heirs by deed, the common law gave to the specialty creditor a right, which the creditor by simple contract did not possess, to have his debt satisfied by the heir out of the lands of his ancestor: the liability thus unposed on the heir was extended to the devisee by 3 & 4 Will, and Maiy, c. 14, § 2. This Act, repealed and re-enacted with extensions of the creditor's remedy in 1830, has been followed by legislation which has gradually placed the simple contract creditor on an equal footing with the spe- cialty creditor as regards the real estate of the debtor. First by 3 & 4 Will. 4, c. 104, real estate not charged with the pay- ment of the debts of the deceased might be administered in a court of equity for the payment of debts, but the smiple contract creditor ranked aJfter the specialty creditor. Then by the Admmistration of Estates Act, 1869," the priority of the specialty creditor was taken away, but the simple contract creditor remained at this disadvantage that unless he obtained the administration of the estate in chancery he had no claim on the realty. Finally, the Land Transfer Act, 1897,* creates a "real representa- tive" who is to administer real estate, subject to the same Uabilities as to debt as if it were personal estate. There is no longer a need for administration by the court to place the two kinds of creditor on the same footing. The specialty creditor only retains this advantage that the fund available for him is not liable to the executor's right of retainer unless for a specialty debt." ^. -. .. . 88. Gratuitous promise under seal. A gratuitous promise, or promise for which the promisor obtains no consideration pres- ent or future, is binding if made under seal, but is of no legal effect if made verbally, or in writing not imder seal.^ I have o 32 & 33 Viot. 0. 46. ' 5 60 & 61 Viot. o. 65. ' c In re Jones, (1885) 31 Ch. D. 440. The right of retainer is the right of the executor to pay to himeeif , before any other creditor of equal rank, any debt due to him by the de- ceased. \ In the absence of statutory changes, gratuitous promises under seal are valid and enforceable. McMillan v. Ames, (18S5) 33 Minn. 257; Krell V. Codman, (1891) 154 Mass. 454; Anderson «. Best, (1896) 176 Pa. 498; Cosgrove v. Cummings, (1900) 195 Pa. 497; Barrett v. Garden, (1893) 65 Vt. 431; Ducker v. Whitson, (1893) 112 N. Car. 44; Storm v. United States, (1876) 94 U.S. 76. But see Swift o. Hawkins, (1768, Pa.) 1 Dall. 17 (following equity rule at law in absence of equity court); Matlock ». Gibson, (1832, S.C.) 8 Rich. L. 437 (holding seal only presiimptive evidence of consideration). Statotoby Changes. (1) Some states, while preserving the distinction between sealed and unsealed instruments, make the presence of the seal only presumptive evidence of consideration, and permit the presumption to be re- butted by evidence of no consideration. Ala. Code, § 3288; Mich. Comp. L. § 10185-86; N.J. Gen. St., (1895) p. 1413, § 72; N.Y. Code Civ. Proc. § 840 ("upon an executory instrument"); Ore. Annot. Codes & St., (1902) § 765; Wis. Annot. St. § 4195. This legislation probably makes it impos- sible (except in New Jersey) to enforce a gratuitous executory promise under seal. Anthony v. Harrison, (1878) 14 Hun, 198, aff'd 74 N.Y. 613; Chap. IV] CONTRACT UNDER SEAL 87 noted above that this feature of contracts under seal has been explained by the solemnity of their form, which is said to import consideration, and so to supply evidence of intention. But this is historically untrue. The form bound the promisor, and not the intention of which the form was the expression. The doctrine of consideration is of later date, and as it has developed, has tended to limit this peculiarity of the promise under seal by the introduction of exceptions to the general rule that a gratuitous promise so made is binding. At common law, contracts in restraint of trade, though under seal, must be shown to be reasonable; and one test of the reasonableness of the transaction is the presence of considera- tion." ^ And the rule is general that if there be in fact consid- o MaUan i. May, (1843) 11 M. & W. 665. Baird v. Baird, (1894) 81 Hun, 300, aff'd 145 N.Y. 659; Williams v. WhitteU, (1902) 69 N.Y. App. Div. 340; Hobbs v. Electric Lt. Co., (1889) 75 Mich. 650. But in New Jersey the legislation is so construed as not to destroy the common law effect of the seal in a case where no consideration was intended, and it is limited in its effect to cases where a consideration was intended and has failed: hence in New Jersey a gratuitous promise imder seal is stiU enforceable where the seal is used in order to give validity to the promise. Aller V. Aller, (1878) 40 N.J. L. 446. In New York by express statutory provision and in New Jersey by judicial construction, the legislation does not apply to executed contracts and conveyances. Matter of Mitchell, (1891, N.Y.) 61 Hun, 372; Talbert v. Storum, (1893) 21 N.Y. Supp. 719 (assignment of life insurance policy); Noble v. Kelly, (1869) 40 N.Y. 415 (release); Homans v. Tyng, (1900) 56 N.Y. App. Div. 383 (release); Finch V. Simon, (1901) 61 N.Y. App. Div. 139 (release); Braden v. Ward, (1880) 42 N.J. L. 518 (release); Wahi v. Wain, (1896) 58 N.J. L. 640 (release). But see Wabash Western Ry. v. Brow, (1895) 65 Fed. 941, 952 (sealed release under Michigan statute not conclusive as to consideration). (2) Many states abolish all distinction between written sealed and un- sealed instruments, and most of these provide that any written contract shall have a rebuttable presumption of consideration. Cal. Civil Code, § 1629; Idaho Civil Code, § 2730; Iowa Code, § 3068; Ind. Rev. St. (Bums' ed.) §454; Kans. Gen. St. Ch. 114, §§ 6, 8; Ky. St. §§ 471-72; Minn. Rev. Laws, (1905) § 2652; Miss. Code, §§ 4079-82; Mo.R. S. §§893-94; Mont. Civ. Code, §§ 2190, 2169; Neb. Comp. St. Ch. 81, § 1; N. Dak. Rev. Code, (1905) § 5338; Oh. R.S. § 4; S. Dak. Annot. St. § 4738; Tenn. Code, §§ 2478-80; Texas R.S. Art. 4862-63; Utah R.S. §§ 1976, 3399; Wyo. R.S. § 2749. See construing such statutes. Bender v. Been, (1889) 78 Iowa, 283 (written release of debt upon part payment not binding); Winter v. Kansas City Cable Ry., (1900) 160 Mo. 159 (same, release under seal); Hale v. Dressen, (1898) 73 Minn. 277 (same); J. B. Streeter Co. v. Janu, (1903) 90 Minn. 393 (undisclosed principal liable on sealed contract); Ames v. Holder- baum, (1890) 44 Fed. 224 (same); Bradley v. Rogers, (1885) 33 Kans. 120 (private seals abolished); Garrett v. Land Co., (1894) 94 Tenn. 459 (same); Murray v. Beal, (1901) 23 Utah, 548 (same). • Actual consideration is necessary to the validity of covenants in re- straint of trade. Alger v. Thacher, (1837, Mass.) 19 Pick. 61; Gompera ». Rochester, (1867) 66 Pa. 194. 88 THE FORMATION OF CONTRACT [Chap. IV eration for a deed, the party sued upon it may show that the consideration was illegal, or immoral, in which case the deed will be void." ^j But it is in the chancery that we find this privilege most encroached upon. The idea of consideration as a necessary element of contract as well as of conveyance, if it did not actually originate in the chancery, has always met with peculiar favor there. It was by means of inferences drawn from the presence or absence of consideration that the covenant to stand seised, the bargain and sale of lands, and the resulting use first acquired validity. And in administering its peculiar remedies, where they are applicable to contract, equity followed the same principles. The court will not grant specific performance of a gratuitous promise, whether or no the promise is made by deed.^ And absence of consideration is corroborative evidence of the presence of fraud or undue influence, on suflBcient proof of which the court will rectify or cancel the deed.' 89. Bonds. The best illustration of a gratuitous promise under seal is supplied by a bond. A bond may be technically described as a promise defeasible upon condition subsequent; that is to say, it is a promise under seal by A to pay a sum of money, which promise is to cease to be binding upon him if a condition stated in the bond is performed. The promise, in fact, imposes a penalty for the non-performance of the condition which is the real object of the bond. The condition desired to be secured may be a money payment, an act or a forbearance. In the first case the instrument is called a common money bond: in the second a bond with special conditions. For instance: A promises X under seal, that on the ensuing Christmas Day he will pay to X £500; with a condition that if before that day he has paid to X £250 the bond is to be void. a Collins v. Blantem, (1767) 1 Sm. L.C. (11th ed.), p. 364. 1 Sterling v. Sinnickson, (1820) 5 N.J. L. 756; Brown v. Kinsey, (1879) 81 N.C. 245; Poison v. Stewart, (1897) 167 Mass. 211. 2 Crandall v. Willig, (1897) 166 III. 233. A seal imports consideration in equity. Mills v. Larrance, (1900) 186 111. 635; Carey v. Dyer, (1897) 97 Wis. 554 (statutory). ' Absence or inadequacy of consideration as corroborative evidence of fraud or undue influence. Hall v. Perkins, (1829, N.Y.) 3 Wend. 626. See Seymour v. Delancy, (1824, N.Y.) 3 Cow. 445; Federal Oil Co. v. West- em Oil Co., (1902) 112 Fed. 373. Chap. IV] CONTRACT UNDER SEAL 89 A promises X, under seal, that on the ensuing Christmas Day he will pay to X £500; with a condition that if before that day M has faithfully performed certain duties the bond is to be void. Common law has differed from equity in its treatment of bonds much as it did in its treatment of mortgages. Common law took the contract in its literal sense and enforced the fulfillment of the entire promise upon breach of the con- dition. Equity looked to the object which the bond was intended to secm-e, and would restrain the promisee from obtaining more than the amount of money due under the condition, or the dam- ages which accrued to him by its breach.^ Statutes have long since limited the rights of the promisee to the actual loss sustained by breach of the condition." ^ (3) When it is essential to employ the contract under seal Qo. Statutory requirements. It is sometimes necessary for the validity of a contract to employ the form of a deed. A transfer of shares in companies governed by the Companies Clauses Act ; * ' a transfer of a British ship or any share therein ; " ^ a lease of lands, tenements, or hereditaments for more than three years, must be made under seal."* * 91. Common-law requirements. Common law requires in two cases that a contract should be made imder seal. o 8 & 9 Will. Ill, 0. 11; 4 & 5 Anne, c. 3; 23 & 24 Vict. c. 126, § 25. 6 8 & 9 Vlot. 0. 16, § 14. c 57 & 58 Vict. 0. 60, § 24. See Form in Schedule A of the Act. d 29 Car. II, c. 3, §§ 1 & 2, and 8 & 9 Vict. c. 106, § 3. I Parks V. Wilson, (1724) 10 Mod. 515; Hobson v. Trevor, (1723) 2 P. Wms. 191; Alison's Case, (1724) 9 Mod. 62; Gardiner v. Pullen, (1700) 2 Vem. 394; Vin. Abr. tit. Obligation, (T) 3. " N.Y. Code Civ. Proc. § 1915, provides that the defeasance clause is to be construed as a covenant to pay the sum or perform the act specified. For the general American practice as to judgments on bonds, see 5 Cyc. 855-58; 3 Encyc. of Pldg. & Prac. 670. ' Transfers of shares in corporations need not be under seal in the United States. Cook on Corps. § 377; 10 Cyc. 595. * Ships may be transferred by parol in the United States. Calais Steam- boat Co. V. Van Pelt, (1862, U.S.) 2 Black, 372, 385; The Amelie, (1867, U.S.) 6 Wall. 18; The Marion S. Harris, (1898) 86 Fed. 798. Provisions are made, however, for a more formal conveyance and record in order to protect the purchaser. U.S. Rev. St. § 4192. " While conveyances of interests in lands are usually made under seal, over one-half of the American states have dispensed with the necessity of a seal in such conveyances. See Birdseye's Abbott's Clerks and Convey- ancers Assistant, (1899) pp. 15-61. Apparently a seal is unnecessary in New York. Real Prop. Law, §§ 207, 208; Leask v. Horton, (1902, N.Y.) 39 Misc. 144. 90 THE FORMATION OF CONTRACT [Chap. IV (a) A gratuitous promise, or contract in which there is no consideration for the promise made on one side and accepted on the other, is void unless made imder seal. It is not really unreasonable, or practically inconvenient that the law should require particular solemnities, to give to a gratuitous promise the force of a binding obUgation." ' (b) A corporation aggregate can only be bound by contracts imder the corporate seal.^ "The seal is the only authentic evidence of what the corporation has done, or agreed to do. The resolution of a meeting however numer- ously attended is, after all, not the act of the whole body. Every member knows he is bound by what is done under the common seal and by nothing else. It is a great mistake, therefore, to speak of the necessity for a seal as a reUc of ignorant times. It is no such thing. Either a seal, or some substitute for a seal, which by law shall be taken as conclusively evidencing the sense of the whole body corporate, is a necessity inherent in the very natiu-e of a corporation." * To this rule there are certain exceptions. Matters of trifling im- portance, or daily necessary occurrence, do not require the form of a deed. The supply of coals to a workhouse, the hire of an inferior serv- ant, furnish instances of such matters. And where a municipal corporation owned a graving dock in constant use, it was held that agreements for the admission of ships might be made by simple contract.''j Trading corporations may through their agents enter into simple contracts relating to the objects for which they were created. "A company can only carry on business by agents — managers and others; and if the contracts made by these persons are contracts which relate to the objects and purposes of the company, and are not incon- sistent with the rules and regulations which govern their acts, they are valid and binding on the company, though not under seal." "* The Companies (Consohdation) Act, ' 1908, § 76 (re-enacting a similar provision in an earher Act), enables a company incorporated o Foakes v. Beer, (1884) 2 App. Caa. 605. 6 Mayor of Ludlow v. Charlton, (1840) 6 M. & W. 815. c Nicholson n. Bradfield Union, (1866) L.R. 1 Q.B. 620; WellB t. Mayor of Kingston on Hull, (1875) L.R. 10 C.P. 402. d South of Ireland Colliery Co. v. Waddle, (1869) L.H. 3 C.P. 469. e 8 Edw. VII. c. 69. ' See § 88, note, ante. ' In the American states a corporation is required to use a seal only when a natural person would be required to use one. Cook on Corp. § 721; 10 Cyc. 10O4r-O8; Bank v. Patterson, (1813, U.S.) 7 Cranch, 299; Gottfried v. Miller, (1881), 104 U.S. 521; Green Co. v. Blodgett, (1895) 169 lU. 169; Leinkauf v. Caiman, (1888) 110 N.Y. 50. (It is to be noted, however, that a few states while dispensing with the necessity of a seal upon the deeds of individuals still require it for corporate deeds.) It is generally provided that a corporate seal may consist of a mere pen-scroll. Blood v. La Serena &c. Co., (1896) 113 Gal. 221; Jacksonville &c. Co. v. Hooper, (1895) 160 U.S. 514. Chap. IV] CONTRACT UNDER SEAL 91 under the Companies Acts to enter, through its agents, into contracts in writing or by parol, in cases where such contracts could be entered into by private persons in like manner; and the legislature has also in some other cases freed corporations from the necessity of contracting under seal and provided different forms in which their common assent may be expressed. There has been some conflict of judicial decision as to the liabiUty of a corporation in cases where no contract has been made under seal but where goods have been suppUed, or work done for the purposes for which the corporation exists.* The point has now been settled in Lawford v. Billericay Rural Council."' The Committee of a Rural District Council employed an engineer, aheady engaged by the corporation for certain purposes, to do a num- ber of acts in reference to work for which he had not been engaged. The committee had no power to bind the corporation by entering into contracts, but their minutes were approved, and their acts thereby affirmed and adopted by the council. The court held that the work done was work for the doing of which the corporation was created, and that having taken the benefit of the work they could not refuse to pay for it. It should be noted that an executory contract of employment made with an engineer, not under seal, would clearly have given no right of action to the engineer or to the corporation. It would appear that where a corporation has done all that it was bound to do under a simple contract it may in like manner sue the other party for a non-performance of his part. But a part-performance of a contract by a corporation will not take the case out of the general rule, and entitle it to sue.* But the exceptional case of contracts made by an urban authority , under the powers and for the purposes of the Public Health Act, 1875," of a value or amount exceeding £50 requires notice. By § 174 of the Act, such contracts must be under seal, and in the face of this positive direction of the statute the common law exceptions above referred to have no application. An urban authority may therefore take the fuU benefit of such contracts and yet set up afterwards the absence of a seal as a complete defense."* But the courts have shown themselves unwilling to extend a principle which enables local author- ities to avoid payment of their debts, and have held that the decision in Lawford v. Billericay Rural Council continued to apply even in the case of an urban authority, where the contract sued upon was made under powers given by a special Act, and not by the Public Health Act, 1875.' [1903] 1 K.B. 772. b Fishmongers' Company v. Robertson, (1843) 5 M. & Gr. 192; Mayor of Kidderminster c. Hardwick, (1873) L.R. 9 Ex. 24. c 38 & 39 Vict. c. 55. d Young V. Leamington Corporation, (1883) 8 App. Cas. 517. e Douglas v. Rhyl U.D.C., [1913] 2 Ch. 407. 1 Where a corporation has received a benefit under a contraet ultra vires, it is liable in quasi-contract. Central Trans. Co. v. Pulknan Car Co., (1890) 139 U.S. 24, 60. See Woodward on Quasi-Contracts, chap. 9; Machen on Corps, chap. 16. 92 THE FORMATION OF CONTRACT [Chap. IV II. SIMPLE CONTRACT 92. All simple contracts reqiure consideration. We have now dealt with the contract which is valid by reason of its form alone, and we pass to the contract which depends for its vaUd- ity upon the presence of consideration. In other words, we pass from the formal to the simple contract, or from the contract under seal to the parol contract, so called because, with cer- tain exceptions to which I will at once refer, it can be entered into by word of mouth. 93. Some simple contracts are not enforceable if not in writing. Certain simple contracts cannot be enforced imless written evidence of the terms of the agreement and of the parties to it is produced; but writing is here needed, not as giving effi- cacy to the contract, but as evidence of its existence. Consider- ation is as necessary as in those cases in which no writing is required: "if contracts be merely written and not specialties, they are parol and consideration must be proved." These are therefore none the less simple contracts, because written evidence of a certain kind is required concerning them. 94. Statutory requirements. The statutory requirements of form in simple contract are briefly as follows: 1. A bill of exchange needed to be in writing by the custom of merchants, adopted into the common law. A promissory note was subject to a like requirement by 3 & 4 Anne, c. 8. Both dociiments are now governed by the Bills of Exchange Act, which further provides that the acceptance of a bill of exchange must also be in writing." ^ 2. Assignments of copyright under the Copyright Act, 1911,* must be in writing." 3. Contracts of marine insurance must be made in the form of a policy." ' 4. The acceptance or transfer of shares in a company is usually required to be in a certain form by the Acts of Par- o 45 & 46 Vict. c. 61, § 17. 6 1 & 2 Geo. V, o. 46. c 54 & 55 Vict. 0. 36, § 93; 6 Edw. VII, o. 41, § 22. 1 The same provisions are found in the Negotiable Instruments Law, §§1, 132 (N.Y. §§ 20, 220) now in force in upwards of thirty American juris- dictions. 2 U.S. Rev. St. § 4955 (copyrights), § 4898 (patents). ' Insurance contracts need not be in writing at common law. Mobile &c. Co. V. McMillan, (1858) 31 Ala. 711. Statutes providing for a standard fire pohcy do not prohibit oral insurance contracts but simply introduce into them the statutory terms. ReUef Fire Ins, Co. v. Shaw, (1876) 94 U.S. 574. Chap. IV] STATUTE OF FRAUDS 93 liament which govern companies generally or refer to particular companies.' 5. An acknowledgment of a debt barred by the Statutes of Limitation must be in writing signed by the debtor, or by his agent duly authorized. " ^ 6. Certain special contracts are required to be in writing by particular statutes: e.g., special contracts with Railway Companies for the carriage of goods, under the Railway and Canal Traffic Act, 1854, § 7.' 7. The Statute of Frauds, 1677, § 4, requires that written evidence should be supplied in the case of certain contracts.' 8. The Sale of Goods Act, 1893, § 4, requires that, in default of certain specified conditions, written evidence should be sup- plied in the case of contracts for the sale of goods worth £10 or upwards.* The requirements of the Statute of Frauds and of the Sale of Goods Act are those which need special treatment, and with these I propose to deal. III. THE STATUTE OF FRAUDS 1. Provisions of the Fourth Section 95. Tenns of the Statute. [The Fourth Section of the Statute (29 Car. II, c. 3, § 4. — 1676) reads as follows:] "No action shall be brought (1) whereby to charge any executor~or administrator upon any special promise to answer damages out of his own estate; (2) or whereby to charge the defendant upon any special promise to answer for the debt, default, or miscarriage of another person; (3) or to charge any person upon any agreement made in consideration of marriage; (4) or upon any contract or sale of lands, tenements, or hereditaments, or any interest in or concerning them; * a 9 Geo. IV, c. 14, § 1; 19 & 20 Vict. o. 97, § 13. 5 17 & 18 Vict. c. 31. 1 See Stimson, Am. St. Law, § 8150. " See Stimson, Am. St. Law, § 4147. Promise of discharged debtor. Ibid. § 4147. Promise to pay debt incmred dm'ing infancy. Ibid. § 4147. Repre- sentation as to character or credit. Ibid. § 4146. ' See post, § 95. This is in force in the American states. See Stimson's Am. St. Law, § 4140. Other contracts required to be in writing may be found in Stimson, Am. St. Law, §§ 4146-48. A statute requiring a writing or other formalities may be intended for the protection of one of the parties only (e.g., the Government), and in such case the failure to comply with the requirements of the statute will not prevent the enforcement of the contract against the other party. U.S. v. New York, &c. S.S. Co., (1915) 239 U.S. 88. * See post. § 110. ' Leases for less than three years were excepted by sections 1 and 2. 94 THE FORMATION OF CONTRACT [Chap. IV (5) or upon any agreement that is not to be performed within the space of one year from the making thereof; unless the agreement upon which such action shall be brought, or some memorandum or note thereof shall be in writing, and signed by the party to be charged therewith or some other person thereunto by him lawfully authorized." ^ As regards this section we have to consider three matters. (1) The nature of the contracts specified. (2) The form required. (3) The effect upon such contracts of a non-compliance with the provisions of the statute. (1) The nature of the contracts specified We will first note the characteristics of the five sorts of con- tracts specified in the section. 96. Special promise by an executor or administrator to answer damages out of his own estate. The liabilities of an executor or administrator in respect of the estate of a deceased * In New York the corresponding provisions, with some additions, are as follows: "No executor or administrator shall be chargeable upon any special promise to answer damages, or to pay the debts of the testator or intestate, out of his own estate, unless the agreement for that purpose, or some mem- orandum or note thereof, be in writing, and signed by such executor or administrator, or by some other person by him thereunto specially author- ized." N.Y. Rev. St. Pt. 2, ch. 6, tit. 5, § 1; Birdseye's Statutes (3d ed.), vol. i, p. 1407, § 172. "A contract for the leasing for a longer period than one year, or for the sale of any real property, or an interest therein, is, void, unless the con- tract, or some note or memorandum thereof, expressing the consideration, is in writing, subscribed by the lessor or grantor, or by his lawfully authorized agent." Real Property Law, § 224. "Nothing contained in this article abridges the powers of courts of equity to compel specific performance of agreements in cases of part performance." Ibid. § 234. "Every agreement, promise or undertaking is void, unless it or some note or memorandum thereof be in writing, and subscribed by the party to be charged therewith, or by his lawful agent, if such agreement, promise or undertaking: "1. By its terms is not to be performed within one year from the making thereof; "2. Is a special promise to answer for the debt, default or miscarriage of another person; "3. Is made in consideration of marriage, except mutual promises to marry; "4. Is a conveyance or assignment of a trust in personal property; "5. Is a subsequent or new promise to pay a debt discharged in bank- ruptcy." Personal Property Law, § 31, Consol. Laws, 1909. See also N.Y. Code Civ. Proc. § 395 (requiring new promise to pay debt barred by Statute of Limitations to be in writing), and § 1942 (re- quiring release of one joint debtor without releasing the other to be in writing). C3HAP. IV] STATUTE OF FRAUDS 95 person are of two kinds. At common law he may sue and be sued upon obligations devolving upon him as representative of the deceased. In equity he may be compelled to carry out the directions of the deceased in respect of legacies, or to give effect to the rules of law relating to the division of the estate of an intestate. In neither case is he boimd to pay anything out of his own pocket: his liabDities are limited by the assets of the deceased. But if, in order to save the credit of the de- ceased, or for any other reason, he choose to promise to answer damages out of his own estate, that promise must be in writing together with the consideration for it, and must be signed by him or his agent. ^ It is almost needless to add that in this, and in all other contracts xmder the section, the presence of writing will not atone for the absence of consideration." 97. Any promise to answer for the debt, default, or mis- carriage of another person. This is a promise of guarantee or stu-etyship. It is always reducible to this form: "Deal with X and if he does not pay you, I will."^ (o) The promise differs from indemnity. This promise is not an indemnity, or promise to save another harmless from the results of a transaction into which he enters at the instance of the promisor. The distraction is of great practical importance, because a contract of indemnity, imlike that of guarantee, does not require to be evidenced by writing of any sort. In a contract of guarantee there must always be three parties in contemplation; a principal debtor (whose liabiHty may be actual or prospective), a creditor, and a third party who in consideration of some act or promise on the part of the creditor, promises to discharge the debtor's liability, if the debtor should fail to do so. The case of Guild v. Conrad * affords a good illustration of a guarantee, and of an indemnity. The plaintiff at the request of the defendant accepted the bills of a firm of Demerara mer- chants, receiving a guarantee from the defendant that he would, if necessary, meet the bills at maturity. Later the firm got into difficulties, and the defendant promised the plaintiff that if he would accept their bills the funds should in any event be pro- a Rann t. Hughes, (1778) 7 T.R. 350 note. 6 [1894] 2 Q.B. 884. 1 McKeany v. Black, (1897) 117 Cal. 587. But not where the promise is to pay money out of his own estate, not as damages for which the decedent's estate is liable, but to subserve some end of his own. Bellows v. Sowles, (1884) 57 Vt. 164; Wales v. Stout, (1889) 115 N.Y. 638. 2 MaUory v. Gillett, (1860) 21 N.Y. 412. 96 THE FORMATION OF CONTRACT [Chap, IV vided. The first promise was a guarantee, the second an indem- nity.* "In my opinion," said Davey, L.J., "there is a clear distinction between a promise to pay the creditor if the principal debtor makes default in payment, and a promise to keep a person who has entered, or is about to enter into a contract of liabiUty, indemnified against that liability independently of the question whether a third person makes default or not." ^ ij^i There must, in fact, be an expectation that another "person" will pay the debt for which the promisor makes himself liable, and in the absence of such expectation the contract is not a contract of suretyship." X, the bailiff of a coimty court, was about to arrest a debtor. A promised to pay the debt if X would forbear to arrest the debtor. This was held to be a promise of indemnity from A to X, since the debtor was mider no liability to Z. * ' \ (6) There must he a primary liability of a third party. There a Harburg India Rubber Comb. Co. t. Martin, [1902] 1 K.B. 778. b Reader v. Kingham, (1862) 13 C.B. (N.S.) 344. ' Jones V. Bacon, (1895) 145 N.Y. 446 (oral promise of defendant to indemnify indorser is not within the statute). In Guild V. Conrad, supra, the difference between the two transactions was this: in the ^rsi, the defendant asked the plaintiff to become a creditor of the Demerara firm; in the second he asked the plaintiff to accept cer- tain bills and thus become a debtor to the holders thereof. ' A promise to indemnify one who becomes bail or surety for another, is not within the statute. Anderson v. Spence, (1880) 72 Ind. 315; Resseter v. Waterman, (1894) 151 HI. 169; MUls v. Brown, (1860) 11 Iowa, 314; Aldrich v. Ames, (1857) 9 Gray, (Mass.) 76; Boyer v. Soules, (1895) 105 Mich. 31; Fidelity &c. Co. v. Lawler, (1896), 64 Minn. 144; Jones v. Bacon, supra. But contra in a few states. May v. Williams, (1883) 61 Miss. 125; Nugent v. Wolfe, (1886) 111 Pa. 471; Hurt v. Ford, (1897) 142 Mo. 283; Kelsey v. Hibbs, (1862) 13 Oh. St. 340. The terms "suretyship," "guaranty," and "indemnity" do not have a fixed and invariable meaning, as commonly used. The term "indemnity" is no doubt the broadest term, and often includes the other two. A promise of S whereby he agrees to indemnify C against loss by reason of his advanc- ing credit to P is within the statute. It is a promise to a creditor to answer for the default of a third person who is his debtor. On the other hand, a promise by X to indemnify S against loss by reason of his becoming bound to C to pay the debt or answer for the default of P is not within the statute. It is a promise to a debtor or obligor. Such is the case of Guild v. Conrad. But such also is the case of Nugent v. Wolfe, supra, where the decision was contra. ' A promise made to the debtor himself to pay a debt which the promisee owes to a third person is not within the statute. Eastwood v. Kenyon, (1840) 11 Adol. & E. 438; Clay Lumber Co. v. Coal Co., (1913) 174 Mich. 613; Meyer v. Hartman, (1874) 72 lU. 442; Smart v. Smart, (1885) 97 N.Y. 559; Pike V. Brown, (1851, Mass.) 7 Cush. 133. Chap. IV] STATUTE OF FBAUDS 97 must be a liability, actual or prospective, of a third party for whom the promisor undertakes to answer. If the promisor makes himself primarily liable, the promise is not within the statute, and need not be in writing. "If two come to a shop and one buys, and the other, to gain him credit, promises the seller 'If he does not pay you, I mil,' this is a collat- eral undertaking and void " without writing by the Statute of Frauds. But if he says, 'Let him have the goods, I loill be your paymaster,' or 'I will see you paid,' this is an undertaking as for himself, and he shall be in- tended to be the very buyer and the other to act aa but his servant." * (c) Prospective liability. The liability may be prospective at the time the promise is made, as a promise by A to X that if M employs X he (A) will go surety for payment of the serv- ices rendered: ^ yet there must be a principal debtor at some time: else there is no suretyship, and the promise, though not in writing, will nevertheless be actionable. Thus if X says to A, "If I am to do this work for M I must be assured of pay- ment by some one," and A says, "Do it; I will see you paid," there is no suretyship, unless M should incur liability by giv- ing an order: if he gives no order and the work is nevertheless done by X, A would be liable not as surety, but as principal debtor, by reason of his oral promise. " ^ (d) Primary debt extinguished. If there be an existing debt for which a third party is liable to the promisee, and if the promisor undertake to be answerable for it, still there is no guarantee if the terms of the arrangement are such as to effect an extinguishment of the original liability. If A says to X, "Give ilf a receipt in full for his debt to you, and I will pay the amount," this promise would not fall within the statute; for there is no suretyship, but a substitution of one debtor for a The word "void" is used incorrectly where "unenforceable" is meant. b Per Curiam in Birkmyr «. Darnell, (1704) 1 Sm. L.C. 299 (11th ed.). c Mountstephen s. Lakeman, (1874) L.R. 7 H.L. 17, and see L.R. 7 Q.B. 202. 1 The liability may be prospective. Davis v. Patrick, (1891) 141 U.S. 479; White V. Rintoul, (1888) 108 N.Y. 222. . 2 Merriman v. McManus, (1883) 102 Pa. 102; West v. O'Hara, (1882) 65 Wis. 645; Barrett v. McHugh, (1880) 128 Mass. 165; Cowdin v. Gottge- treu, (1873) 55 N.Y. 650. If the defendant undertakes for a person not himself liable to the promisee, there is no guaranty. Mease v. Wagner, (1821, S.C.) 1 McCord, 395; Marion v. Faxon, (1850) 20 Conn. 486; Harian v. Harlan, (1897) 102 Iowa, 701. But a promise to guaranty a minor's debt is within the statute. Dejrter V. Blanchard, (1865, Mass.) 11 Allen, 365; Scott v. Bryan, (1875) 73 N.C. 582. 98 THE FORMATION OF CONTRACT [Chap. IV another. The liability of the third party must be a continuing liability. " ^ (e) Includes tort obligaMon. The debt, default, or miscarriage spoken of in the statute will include liabilities arising out of wrong as well as out of contract. So in Kirkham v. Marter^ M wrongfully rode the horse of X without his leave, and killed it. A promised to pay X a certain sum in consideration of his forbearing to sue M, and this was held a promise to an- swer for the miscarriage of another within the meaning of the statute.^ {J) Confined to obligations enforceable at law. It has been o Goodman i. Chase, (1818) 1 B. & Aid. 297. 6 (1819) 2 B. & Aid. 613. 1 Booth V. Eighmie, (1875) 60 N.Y. 238; Griffin ». Cunningham, (1903) 183 Mass. 505. Although the principal debt is not extinguished, the promise to pay it is original and not collateral when, for a new consideration moving to the promisor and beneficial to him, the promisor comes under an independent duty of payment, irrespective of the liability of the primary debtor. In such case the promise has been made, not to accommodate the debtor or benefit the creditor, but to subserve some substantial interest of the prom- isor. Prime v. Koehler, (1879) 77 N.Y. 91 (grantee of mortgaged premises promises to pay the mortgage if mortgagee wiU forbear to foreclose it); Manning v. Anthony, (1911) 208 Mass. 399 (same); Raabe v. Squier, (1895) 148 N.Y. 81 [owner of building promises to pay sub-contractor if he will con- tinue to furnish material to contractor — but see contra, Rand ». Mather, (1853, Mass.) 11 Cush. 1]; CUfford v. Luhring, (1873) 69 HI. 401 (same); Bailey v. Marshall, (1896) 174 Pa. 602 (a judgment-creditor promises to pay another creditor if latter will forbear to enter judgment or levy execution against a debtor); Davis v. Patrick, (1891) 141 U.S. 479. So also if property of the debtor is transferred to the promisor for the purpose of paying the debt. First Nat. Bk. v. Chahners, (1895) 144 N.Y. 432. But if there is no such benefit to the promisor, the promise is within the statute. Malloiy v. Gillett, (1860) 21 N.Y. 412; White o. Rintoul, (1888) 108 N.Y. 222. In Harburg I. R. Co. v. Martin, [1902] 1 K.B. 778, it is said that to hold that the existence of a consideration beneficial to the promisor takes the promise out of the statute is a repeal of the statute. Nevertheless it is very common to hold, as in Bailey v. Marshall, supra, that "when the leading object of the promisor is to subserve some interest or purpose of his own, notwithstanding the effect is to pay, or discharge the debt of another, his promise is not within the statute." This appears to be the chief ground for holding that a promise of a del credere agent to make good any loss arising to the principal from sales or other contracts, is not within the statute. Wolff V. Koppel, (1843, N.Y.) 5 HiU, 458; Swan v. Nesmith, (1828, Mass.) 7 Pick. 220; Davys v. Buswell, [1913] 2 K.B. 47. In these cases there is no fiduciary relation between the promisor and the other debtor, and the promisor is not a surety. Upon settlement by him with the creditor, he becomes an assignee of the creditor's rights, and he may make a profit over and above mere reimbursement. A true surety cannot do this. 2 Baker v. Morris, (1885) 33 Kans. 580; Jacobs v. Burgwyn, (1868) 63 N.C. 196. Chap. IV] STATUTE OF FRA.UDS 99 necessary in the case of this contract to point out that the words of the statute only apply to promises on which an action at law can be brought. It might be possible so to frame a guar- antee, as between partners, that it could only be enforced by equitable remedies, and in such a case it does not fall within the statute." (g) ConsideraUon need not he expressed. This contract is an exception to the general rule that "the agreement or some memorandum or note thereof," which the statute requires to be in writing, must contain the consideration as well as the prom- ise: 19 & 20 Vict. c. 97, § 3.1 98. Agreement made in consideration of marriage. The agreement here made is not the promise to marry ^ (the con- sideration for this is the promise of the other party), but the promise to make a payment of money or a settlement of prop- erty in consideration of, or conditional upon a marriage actually taking place. ' 99. Contract or sale of lands or hereditaments or any interest in or concerning them. The rules which govern the forms of sale or conveyance of land are to be found elsewhere than in the Statute of Frauds, and are not a part of the law of con- tract. But the statute deals with agreements made in view of such sales, and it is not always easy to say what constitutes an interest in land. Contracts which are preliminary to the acqui- sition of an interest,* or such as deal with a remote and inap- a Re Hoyle, [1893] 1 Ch. at p. 97.* b Boston v. Boston, [1904] 1 K.B. 124. * This case seems unsound and based upon a barren technicality. The promisees had a claim against the son. Hence, the promise was to a creditor to answer for the default of his debtor. The case illustrates the strong tendency of the courts to narrow the operation of the statute. 1 See Browne, Statute of Frauds, §§ 390, 391. » Short V. Stotts, (1877) 58 Ind. 29; Blackburn v. Mann, (1877) 85 Dl. 222. But if the promise to marry is by its terms not to be performed within one 3rear it is unenforceable. Derby v. Phelps, (1822) 2 N.H. 515; Paris v. Strong, (1875) 51 Ind. 339; Barge v. Haslam, (1901) 63 Neb. 296; Lawrence v. Cooke, (1868) 56 Me. 187. Contra : Brick v. Gunnar, (1885, N.Y.) 36 Hun, 52; Lewis V. Tapman, (1900) 90 Md. 294. ' Hunt V. Hunt, (1902) 171 N.Y. 396; White v. Bigelow, (1891) 154 Mass. 593; Richardson v. Richardson, (1893) 148 111. 563; Lloyd v. Fulton, (1875) 91 U.S. 479; Dienst v. Dienst, (1913) 175 Mich. 724; cf. Nowack v. Berger, (1896, Mo.) 34 S.W. 489. A mutual engagement to marry is within the statute if by its terms it is not to be performed within one year. Derby v. Phelps, (1822) 2 N.H. 515; Nichols V. Weaver, (1871) 7 Kan. 373; Ullman v. Meyer, (1882) 10 Fed. 241. Cmtra : Lewis v. Tapman, (1900) 90 Md. 294; Blackburn v. Mann, (1877) 86 111. 222. — " 100 THE FORMATION OF CONTRACT [Chap. IV preciable interest, are outside the section. Such would be an agreement to pay for an investigation of title; to put a house into repair for a prospective tenant; " or to transfer shares in a railway company which, though it possesses land, gives no appreciable interest in the land to its shareholders.^ But the chief difficulties which have arisen in interpreting this section are with reference to the sale of crops. A distinction has been drawn as to these between what are called emblements, crops produced by cultivation, or Jrudus indusbriales, and growing grass, timber, or fruit upon trees, which are called fruchis naturales. The law is now settled thus. If the property is to pass after the crops are severed from the soil then both jruclus naturales and fructiis industriales are goods within the meaning of the 4th section of the Sale of Goods Act.' ^ If the property is to pass before severance fructus industriales are goods, ^ but frudus natwales are an interest in land.* 100. Agreement not to be performed within the space of one year from the making thereof. Two distinctions should be noted with regard to this form of agreement. o Angell 5. Duke, (1875) L.R. 10 Q.B. 174. 5 56 & 57 Vlot. o. 71, § 62. 1 Heyn v. Philips, (1869) 37 Cal. 629. A partnership to deal in lands is not within the statute. Babcock v. Read, (1885) 99 N.Y. 609; Howell v. Kelly, (1892) 149 Pa. 473; Wetherbee v. Potter, (1868) 99 Mass. 354. But see contra, Smith v. Putnam, (1900) 107 Wis. 155. 2 (The 17th Section of the Statute of Frauds.) Killmore v. Howlett, (1872) 48 N.Y. 669 (trees to be cut by vendor and delivered as cord wood). So also as to fixtures to be severed by the vendor. Long v. White, (1884) 42 Ohio St. 59. A contract for the sale of a standing building is within the statute if it purports to pass title before severance. Lavery v. Pursell, (1888) 39 Ch. D. 508; but it is not within the statute if it purports to provide for the passing of title after severance. Long v. White, supra; Wetkopsky v. N.H. Gas Co. (1913) 88 Conn. 1. As to the sale of tenant's fixtures, see Williston, Sales, § 66. ' Crops planted annually are treated as personalty. Northern v. State, (1848) 1 Ind. 113; Whitmarsh v. Walker, (1840, Mass.) 1 Met. 313; Purner V. Piercy, (1874) 40 Md. 212. * Sales of growing trees are within the fourth section of the statute. Hirth V. Graham, (1893) 60 Oh. St. 67, and cases there cited pro and con. Marshall v. Green, (1876) 1 C.P.D. 36, holds that a contract for the sale of standing trees to be cut by the buyer and removed in a short period is not a contract for the sale of an interest in land. This seems to hold that the test is the intention of the parties and not the physical character of the thing sold or its status in the law of property. It was held, on the other hand, in Lavery t). Pursell, (1888) 39 Ch. D. 608, that a sale of a house to be severed and removed by the buyer within sixty days was within the statute. See Williston, Sales, §§61-67, Bennett, "Sales of Standing Trees," 8 Harvard Law Review, 367. Chap. IV] STATUTE OF FRAUDS lOJo/ It (a) If the contract is for an indefinite time but can be deter-V mined by either party with reasonable notice within the year the statute does not apply. A contract to pay a weekly sum for the maintenance of a child, or of a wife separated from her husband, has been held on this ground to be outside the section." This is what is meant by the dichim that to bring a contract within the operation of the statute it must "appear by the whole tenor of the agreement that it is to be performed after the yeaj." If the contract is for a definite period, extending beyond the year, then, though it might be concluded by notice within the year, on either side, the statute operates.'' ^ (6) If all that one of the parties undertakes to do is intended to be done, and is done, within the year, the statute does not apply. A was tenant to X, under a lease for twenty years. He promised verbally to pay an additional £5 a year for the remainder of the term in consideration that X laid out £50 a McGregor v. McGregor, (1888) 21 Q.B.D. 429. ■ 6 Hanau v. EhrUch, [1911] 2 K.B. 1056, [1912] App. Gas. 39. 1 A contract is not within this clause of the statute unless its terms are so drawn that it cannot by any possibility be performed fully within one year. It is not within the statute merely because it later turns out that it is not performed within one year. Peter v. Compton, (1693) Skinner, 353 (promise to pay after the plaintiff should marry) ; Warner v. Texas & Pac. R. Co., (1896) 164 U.S. 418 (promise to maintain a railway switch as long as plaintiff should need it. Many other cases are cited). Contracts which inherently or by their terms depend for their continuance upon a life, are not within the statute. Peters v. Westborough, (1837, Mass.) 19 Pick. 364; Harper v. Harper, (1877) 57 Ind. 547; Carr v. McCarthy, (1888) 70 Mich. 258. Nor contracts to be performed at the death of a person. Kent v. Kent, (1875) 62 N.Y. 560; Riddle v. Backus, (1874) 38 Iowa, 81. But an affirma- tive contract that is by its terms to last beyond a year is not taken out of the statute by the fact that it may become impossible of performance before the end of a year, as a contract for personal service that would terminate earlier by the death of the servant. Hill v. Hooper, (1854, Mass.) 1 Gray, 131; Wahl v. Barnum, (1889) 116 N.Y. 87 (partnership). An express reser- vation of an option to terminate within a year has been held to take the contract out of the statute. Blake v. Voight, (1892) 134 N.Y. 69. It has been held that a contract made on March 31 for exactly a year's service to begin on April 1 is within the statute. Billington v. CahUl, (1889) 51 Hun, 132. Contra, Smith v. Gold Coast Co., [1903] 1 K.B. 285. See also Odell V. Webendorfer, (1900) 50 App. Div., (N.Y.) 579. A contract is not taken out of the statute by the fact that the parties may rescind it within a year. Wagniere v. Bunnell, (1909) 29 R.I. 580; 17 Ann. Cas. 205, and note. A negative contract, to forbear for a period of years, has been regarded as one that is fully performed upon the death of the promisor, and hence not within the statute. Doyle o. Dixon, (1867) 97 Mass. 208. 102 THE FORMATION OF CONTRACT [Chap. IV in alterations. X did this and A was held liable on his prom- ise, oi But if the iindertaking of one of the parties cannot be per- formed, while that of the other might be, but is not intended to be, performed within the year, the contract falls under the section.* (2) The form required loi. Requirements of form. The form required is the next point to be considered. What is meant by the requirement that " the agreement or some memorandum or note thereof shall be in writing and signed by the party to be charged therewith or some other person thereunto by him lawfully authorized" ? We may, with regard to this part of the subject, lay down the following rules." 102. The form is merely evidentiary. The form required does not go to the existence of the contract. The contract exists though it may not be clothed with the necessary form, and the effect of a non-compliance with the provisions of the statute is simply that no action can be brought until the omis- sion is made good. It is not difficult to illustrate this proposition. Thus the note in writing may be made so as to satisfy the statute, at any time between the formation of the contract and the commence- ment of an action: ^ or the signatiu-e of the party charged may be affixed before the conclusion of the contract. Again one party to the contract may sign a rough draft of a Donellan v. Read, (1832) 3 B. & A. 899. 5 Reeve v. JenmngB, [1910] 2 K.B. 522. c With the exception of riile (§ 105), what is said under thia head may be taken to apply to the 4th section of the Sale of Goods Act [17th section of Statute of Frauds] as well as to the 4th section of the Statute of Frauds. ' This is a much disputed question in the United States. Some cases follow Donellan v. Read cited by the author: Fraser v. Gates, (1886) 118 m. 99; Piper v. Fosher, (1889) 121 Ind. 407; Smalley v. Greene, (1879) 52 Iowa, 241; Bless v. Jenkins, (1895) 129 Mo. 647; Grace v. Lynch, (1891) 80 Wis. 166. Others hold that such a case is within the statute when either promise is not to be performed within a year. Marcy v. Marcy, (1864, Mass.) 9 Allen, 8; Dietrich v. Hoefehneir, (1901) 128 Mich. 145; Rein- heimer v. Carter, (1877) 31 Oh. St. 579. 2 Bird V. Munroe, (1877) 66 Me. 337; Walker v. Walker, (1900, Ky.) 55 S.W. 726; McAnnulty v. McAnnulty, (1887) 120 111. 26. The weight of authority seems to be that a memorandum that was not in existence prior to the bringing of the action is not sufficient to sustain that action. Bailey v. Sweeting, (1861) 9 C.B. (N.S.) 843 (per Williams, J.) ; Lucas v. Dixon, (1889) 22 Q.B.D. 357; WiUiston, Sales, § 117; Tisdale ». Harris, (1838, Mass.) 20 Pick. 9 (semble); Bird v. Munroe, supra. Contra, Cash v. Clark, (1895) 61 Mo. App. 636. Chap. IV] STATUTE OF FRAUDS 103 its terms, and acknowledge his signature by way of conclud- ing the contract when the draft has been corrected." And an offer containing the names of the parties and the terms of an offer signed by the offeror will bind him, though the contract is concluded by a subsequent parol acceptance.* ' In the first of these cases the signature of the party charged — in the second not the signature only but the entire memo- randum — was made before the contract was concluded. It may even happen that one of the parties to a contract which he has not signed may acknowledge it in a letter which sup- plies his signature and contains at the same time an announce- ment of his intention to repudiate the contract. He has then supplied the statutory evidence, and, as the contract has al- ready been made, his repudiation is nugatory." ^ 103. The parties and subject-matter must appear. The parties and the subject-matter of the contract must appear in the memorandum. The parties must be named, or so described as to be iden- tified with ease and certainty. A letter beginning "Sir," signed by the party charged but not contaiaing the name of the per- son to whom it is addressed, has more than once been held insuffi- cient to satisfy the statute."* ' But, if the letter can be shown to have been contained in an envelope on which the name appears, the two papers will be regarded as one document, and the statute is satisfied.* Where one of the parties is not named, but is described, parol evidence will be admitted for the purpose of identifica- tion if the description points to a specific person, but not otherwise. If A contracts with X in his own name, being really agent for M, X or M may show that M was described in the memorandum in the character oi A/^ a Stewart t. Eddowes, (1874) L.R. 9 C.P. 311. b Reuss 0. Picksley, (1866) L.R. 1 Excb. 342. c Buxton V. Rust, (1872) L.R. 7 Exoh. 1 & 279. d WiUiams o. Lake, (1859) 2 E. & E. 349; WilliamB s. Jordan, (1877) 6 Ch. D. 517. e Pearce t. Gardner, (1897] 1 Q.B. 688. / SeeComminsD.Soott, (1875) L.R.20Eq. 15,16; Truemanu.Loder, (1840) 11 A.& E.589. 1 Mason v. Decker, (1878) 72 N.Y. 695; Lydig v. Braman, (1900) 177 Mass. 212; Gradle v. Warner, (1892) 140 111. 123; Austrian & Co. v. Springer, (1892) 94 Mich. 343. 2 Drury v. Young, (1882) 58 Md. 546; Louisville &c. Co. v. Lorick, (1888) 29 S.C. 533; Bailey v. Sweeting, supra. ' Grafton v. Cummings, (1878) 99 U.S. 100; Mentz v. Newwitter, (1890) 122 N.Y. 491. But the letter addressed to a third party is suflScient if it contains the required names and terms. Peabody v. Speyers, (1874) 56 N.Y. 230; Spangler v. Danforth, (1872) 65 HI. 152. * Huffcut, Agency, § 123. 104 THE FORMATION OF CONTEACT [Chap. IV If property is sold by an agent on behalf of the owner or proprietor it may be proved by parol that X was the owner or proprietor; if the sale was made by the agent on behalf of the vendor, of his client, or his friend, there would be no such certainty of statement as would render parol evidence admis- sible." The same principle is applied to descriptions of the subject- matter of a contract. Where X agreed to sell and A to buy "24 acres of land freehold and all appurtenances thereto at Totmanslow in the parish of Draycott in the County of Stafford" parol evidence was admitted to identify the land.* But a receipt for money paid by .4 to X "on account of his share ia the Tividale mine" was held to be too uncertain as to the respective rights and liabilities of the parties, to be identified by parol evidence." ^ 104. The terms may be collected from vaiious documents. The memorandum may consist of various letters and papers, but they must be connected and complete.^ The statute requires that the terms, and all the terms of the contract, should be in writing, but these terms need not appear in the same document: a memorandum may be proved from several papers or from a correspondence, but the connection must appear from the papers themselves. Parol evidence is admissible to connect two documents where each obviously refers to another, and where the two when thus connected make a contract without further ex- planation. This is the principle laid down in Long v. MiUar,^ and adopted in more recent cases. ^ It is not inconsistent with the decision in the often-cited case of Boydell v. Drummond.' a Eossiter ii. Miller, (1878) 3 App. Cas. 1141; Potter v. Duffield, (1874) 18 Eq. 4. b Plant V. Bourne, [1897] 2 Ch. (C.A.) 281. c Caddick o. Skidmore, (1857) 2 De G. & J. 52. d (1879) 4 C.P.D. 454. e (1809) 11 East, 142. 1 Doherty v. Hill, (1887) 144 Mass. 465; Ryan v. United States, (1889) 136 U.S. 68; Portescue v. Crawford, (1890) 105 N.C. 29. But the description is sufficient if the property and the interest in it are capable of unambiguous identification. Ryder v. Loomis, (1894) 161 Mass. 161 (my right in my father's estate) ; as to the power of equity to supply deficiencies in the de- scription see L.R.A. 1917 A, 563-603. ' O'Donnell v. Leeman, (1857) 43 Me. 158; Tice v. Freeman, (1883) 30 Minn. 389; Thayer v. Luce, (1871) 22 Ohio St. 62; Bayne v. Wiggins, (1891) 139 U.S. 210; Brewer v. Horst and Lachmund Co., (1900) 127 Cal. 643; Lemed v. Wannemacher, (1864, Mass.) 9 Allen, 412; Gibson «. Holland, (1865) L.R. 1 C.P. 1. » Beckwith v. Talbot, (1877) 95 U.S. 289; Lee v. Butler, (1897) 167 Mass. 426. Chap. IV] STATUTE OF FRAUDS 105 There two forms of prospectus were issued by the plaintiff, inviting subscriptions to an illustrated edition of Shakespeare. Subscribers might purchase the prints only, or the work in its entirety. The defendant entered his name in a book in the plaintiff's shop, entitled "Shakespeare Subscribers, their signat^lres;" afterwards he refused to carry out his purchase; and it was held that the subscription book and the prospectus were not connected by documentary evidence, and that parol evidence was not admissible to connect them. But though the rule as to the admission of parol evidence has been un- doubtedly relaxed since 1809, it seems that Boydell v. Drum- mond would not now be decided differently, for the evidence sought to be introduced went further than the mere connection of two documents, and seems to have dealt with the nature and extent of the defendant's liability. Again, the terms must be complete in the writing. Where a contract does not fall within the statute, the parties may either (1) put their contract into writing, (2) contract only by parol, or (3) put some of the terms in writing and arrange others by parol. In the last case, although that which is written may not be varied by parol evidence, yet the terms arranged by parol are proved by parol, and they then supplement the writing, and so form one entire contract. But where a contract falls within the statute, all its terms must be in writing, and the offer of parol evidence of terms not appearing in the writing would at once show that the contract was something other than that which appeared in the written memorandxun.* ^ los- Whether consideration must appear. The consideration must appear in writing as well as the terms of the promise sued upon. This rule has been settled since the year 1804.'' ^ It is not wholly applicable to the sale of goods, ' and is subject to an exception, created for reasons of commercial convenience a Greaves ». Aahlin, (1813) 3 Camp. 426. 6 Wain v. Warltera, (1804) 5 East, 10. 1 O'Donnell v. Leeman, mpra; Drake v. Seaman, (1884) 97 N.Y. 230. 2 This was based upon the term "agreement " in the fourth section, which was held to require a statement of the consideration. The American courts have differed, but so far as the consideration is executory it must be stated in the writing. Drake v. Seaman, (1884) 97 N.Y. 230. In some states the matter is settled by an express statutory requirement. Browne, Statute of Frauds, §§ 390-91; Stimson, Am. St. Law, § 4142. ' The term "bargain" in the 17th section is construed to include the price only when a price has been agreed upon. Browne, Statute of Frauds, § § 376- 79. 106 THE FORMATION OF CONTRACT [Chap. IV by the Mercantile Law Amendment Act, 1856, in the case of the "promise to answer for the debt, default or miscarriage of another": such a promise shall not be "deemed invalid to support an action, suit, or other proceeding to charge the person by whom such promise shall have been made by reason only that the consideration for such promise does not appear in writing, or by necessary inference from a written document." (19 & 20 Vict. c. 97, § 3.) ^ io6. Signature of party or agent. The memorandum must be signed by the party charged ^ or his agent.' The contract therefore need not be enforceable at the suit of both parties; it may be optional to the party who has not signed to enforce it against the party who has.* The signature need not be an actual subscription of the party's name, it may be a mark; nor need it be in writing, it may be printed or stamped; nor need it be placed at the end of the document, it may be at the beginning or in the middle." * But it must be intended to be a signature, and as such to be a recognition of the contract, and it must govern the entire contract.* These rules are established by a number of cases ttuning upon diflficult questions of evidence and construction. The principal cases are elaborately set forth in Benjamin on Sales," but a further discussion of them would here be out of place. a See Benjamin on Sales, pp. 231-34 (4th ed.). !i Huoklesby t. Hook, (1900) 82 L.T. 117. c Sth ed., chap. VI. ' Some American statutes provide that the consideration must appear iQ a guaranty, and some provide that it need not appear. Stimson, Am. St. Law, §§ 4140-42; 29 Am. & Eng. Encyc. of Law (2d ed.), pp. 868-72. * In New York by party to be charged in all cases except the sale or leasing of lands, and in that case by the grantor or lessor. See § 95, note 2, ante. ' The agent may be appointed by parol, unless, as in some states, the statute specifies otherwise. An agent may act for both parties, but one party cannot be agent for the other. O'DonneU v. Leeman, (1857) 43 Me. 158; Johnson v. Dodge, (1856) 17 111. 433; Browne, Statute of Frauds, §§ 367-70; Wright v. Dannah, (1809) 2 Camp. 203. ' Justice V. Lang, (1873) 42 N.Y. 493, 52 N.Y. 323; Bowers v. Whitney, (1902) 88 Minn. 168; cf. Adams v. Hotel Co., (1908) 154 Mich. 198; Kerrw. Finch, (1913) 25 Idaho, 32. s Evans v. Hoare, [1892] 1 Q.B. 593; Clason v. Bailey, (1817, N.Y.) 14 Johns. 484; Salmon Falls Mfg. Co. v. Goddard, (1852, U.S.) 14 How. 446; Sanborn v. Flagler, (1864, Mass.) 9 Allen, 474. But if the statute reads "sub- scribed" instead of "signed," the signature must be at the end of the memorandum. James v. Patten, (1852) 6 N.Y. 9. See L.R.A. 1917 A, 151. Chap. IV] STATUTE OF FRAUDS 107 (3) Effect of non-compliance with statute 107. Statute does not avoid contract. It remains to consider what is the position of parties who have entered into a con- tract specified in § 4, but have not complied with the pro- visions of the section. Such a contract is neither void nor voidable, but it cannot be enforced by action because it is incapable of proof. ^ It has been shown that a memorandum in the requisite form, whether made before or after the fact of agreement, will sat- isfy the requirements of the statute. ^ But the nature of the disability attaching to parties who have not satisfied these requirements may be illustrated by cases in which they have actually come into court without supplying the missing form. 108. Contract cannot be proved. In the case of Leroux v. Brovm," the plaintiff sued upon a contract not to be performed within the year, made in France and not reduced to writing. French law does not require writing in such a case, and by the rules of private international law the validity of a contract, so far as regards its formation, is determined by the lex loci coniradus, the law of the place where it is made. The mode of proof of the contract, however, (as being a matter of procedure), is governed by the lex fori, the law of the place where the action is brought. If, therefore, the 4th sec- tion avoided contracts made in breach of it, the plaintiff could have recovered, for his contract was good in France where it was made, and the lex lod contractus would have been appli- cable. If, on the other hand, the 4th section affected the mode of proof only, the contract, though not void, was incapable of proof in England, because the necessary evidence was wanting. Leroux tried to show that his contract was void by English law. He would then have succeeded, for he could have proved, a (1852) 12 C.B. 801. ' The statute does not affect fully executed contracts. Brown v. Farmers' &c. Co., (1889) 117 N.Y. 266; Stone v. Dennison, (1832, Mass.) 13 Pick. 1. As to contracts executed on one side, see § 100, note 1, p. 102, ante. If one party has conferred a benefit by performance such as would have raised an implied promise to compensate, he may recover in gvantum meruit. McDon- ald V. Crosby, (1901) 192 111. 283; Wallace v. Long, (1885) 105 Ind. 522; Spinney v. Hill, (1900) 81 Minn. 316. See Woodward, Quasi-Contracts. The statute must be pleaded in order to be available as a defense. Browne, Statute of Frauds, § 508 et seq. Matthews v. Matthews, (1897) 154 N.Y. 288. But see Dunphy v. Ryan, (1886) 116 U.S. 491. « See § 102, arUe. 108 THE FORMATION OF CONTRACT [Chap. IV first, his contract, and then the French law which made it valid. But the court held that the 4th section dealt only with matters of proof, and did not avoid his contract, but only made it incapable of proof, unless he could produce a memorandum of it. This he could not do, and so lost his suit.' 109. Doctrine of part performance in equity. The rule is further illustrated by the mode in which equity has dealt with such contracts.^ The history of the matter needs attention. In suits for obtaining specific performance, equity would admit parol evidence to show that a contract had been made (even though it was one of a kind required to be in writing by the statute of frauds), where one of the parties had so acted on the faith of promises made by the other, as to render it unfair that both should not be bound.' When the Judicature Act enabled all the divisions of the High Court to recognize and administer equitable rights and remedies, then the reason of the rule and its limitation to this form of remedy were at first overlooked, and so in Britain v. Rossiter " an action was brought for wrongful dismissal, in o (1879) 11 Q.B.D. 123. ' The statute affects only the remedy and not the validity of the contract. Townsend v. Hargraves, (1875) 118 Mass. 325; Bird v. Mvmroe, (1877) 66 Me. 337; Buhl v. Stephens, (1898) 84 Fed. 922. CT. Miller v. Wilson, (1893) 146 ni. 523. " Matters bearing upon the execution, the interpretation, and the validity of a contract are determined by the law of the place where the contract is made. Matters connected with its performance are regulated by the law prevailing at the place of performance. Matters respecting the remedy, such as the bringing of suits, admissibility of evidence, statutes of limitation, depend upon the law of the place where the suit is brought." Scudder v. Union Nat. Bk., (1875) 91 U.S. 406. ^ The doctrine has no application to an action at law, and is invoked only in equity. It is a species of judicial legislation, but is now recognized in the statutes of some states. See N.Y. Real Property Law, § 234. It is not adopted in Kentucky, Mississippi, North Carolina, and Tennessee. ' The doctrine is said to be based on the fraud of the defendant in induc- ing the plaintiff to make some irretrievable change of situation reljong upon the promise, and then refusing to perform. Browne, Statute of Frauds, §§ 437-40, 448. If the plaintiff can be put in statu quo without enforcing the contract specifically, a case for avoiding the statute is not presented. Hence mere payment of the purchase money is not enough, since it may be recovered in an action at law. Browne, § 461. In most jurisdictions, taking possession of lands, whether with or without payment of purchase money, is a sufficient part performance. Browne, §§ 465-86. But some states seem to require something more in order to establish such an irretrievable change of situation as will enable an equity court to disregard the statute, — as improvements or other acts that cannot be in any way compensated. Bums V. Daggett, (1886) 141 Mass. 368; Miller v. Ball, (1876) 64 N.Y. 286. Chap. TV] STATUTE OF FRAUDS 109 breach of a verbal contract of service not to be performed within the year. The contract had been performed in part and the rule of equity was invoked to dispense with the need of writing. The contract was one to which the remedy by specific performance was inapplicable: the doctrine of part performance would therefore have been equally inapplicable. The court held, however, that the rule of equity was limited to contracts relating to an interest in land. This limitation of the doctrine is not wholly consistent with earlier authorities. Probably the true rule is laid down by Kay, J., in McManus v. Cooke," after a careful examination of the cases bearing on the subject. "It is probably more accurate to say that the doctrine of part performance applies to all cases in which a court of equity would entertain a suit for specific performance if the alleged contract had been in writing." And, conversely, it has since been held that in cases where equity would not have granted specific performance, such as a contract to enter into a partnership, the doctrine has no ap- plication.' The Judicature Act, therefore, has not extended the remedy, but only the jurisdiction through which the remedy may be obtained, and as the chancery could not have given damages in lieu of specific performance before the Act, so damages can- not be obtained where parol evidence is admitted as above described." * For a review of the acts which have been held to constitute part performance, the reader must be referred to Sir Edward Fry's book on Specific Performance (ed. 5), pp. 291-313. But it must constantly be borne in mind that "the acts relied upon as part performance must be unequivocally and in their own nature referable to some such agreement as is alleged," ^ and they must be acts done by the person seeking to enforce the contract and not by the person against whom it is sought to be enforced. They must, in other words, be acts which are only to be explained on the footing of the contract alleged by the a (1887) 35 Ch. D. 681, 697. 6 Turner v. Melladew, (1903) 19 T.L.R. 273. e Lavery v. PiirseU, (1888) 39 Ch. D. 508, 519. d Lord Selbome, C, in Maddison t. Aldereon, (1883) 8 App. Cas. 479. ' The same problem arises in comiection with the many American stat- utes similar to the Judicature Act. 110 THE FORMATION OF CONTRACT [Chap. IV plaintiff." Taking possession of the land, giving notice to tenants already in possession, are examples of such acts. In Maddiscm v. Alderson'' a promise of a gift of land was made to the plaintiff in consideration that she remained in the service of the promisor during his lifetime. She did so; but the House of Lords," affirming the judgment of the Court of Appeal, held that the service so rendered was not exclusively referable to the promised gift. It might have been given for other reasons, and so was not such part performance as ad- mitted parol evidence of the promise.'' ' 2. Provisions of the Seventeenth Section 110. Terms of the Statute. [The Seventeenth Section of the Statute reads as follows: No contract for the sale of any goods, wares or merchandises for the price [or value] of ten pounds sterling, or upwards, shall be allowed to be good, except (1) the buyer shall accept part of the goods so sold and actually receive the same, (2) or give something in earnest to bind the bargain or in part payment, (3) or that some note or memorandum in writing of the said bargain be made and signed by the parties to be charged by such contract, or their agents thereunto lawfully au- thorized.]^ o Daniels v. TretusiB, [1914] 1 Ch. 788. b 7 Q.B.D. 174. e 8 App. Cas. 467. d Cf. Dickinson v. Barrow, [1904] 2 Ch. 339. 1 Some American cases hold the rendering of services not a suflScient part performance. Russell v. Briggs, (1901) 165 N.Y. 500; Johns v. Johns, (1879) 67 Ind. 440; Crabillw. IVIarsh, (1882) 38 Ohio St. 331 ; Kessler's Estate, (1894) 87 Wis. 660. But others hold such services a sufficient part performance. Vreeland v. Vreeland, (1895) 53 N.J. Eq. 387; Lloyd v. Hollenback, (1893) 98 IVIich. 203; Warren v. Warren, (1883) 105 111. 568; Svanburg v. Fosseen, (1899) 75 IMiim. 350. See as to virtual adoption of child on an oral promise to convey land to it, Shahan ti. Swan, (1891) 48 Ohio St. 25 (not enforce- able). Kofka V. Rosicky, (1894) 41 Neb. 328 (enforceable). Cf. IVIahaney v. Carr, (1903) 175 N.Y. 454. IVIarriage cannot be treated as part performance because it is expressly excluded by the statute. Hunt v. Hunt, (1902) 171 N.Y. 396. ' The origiaal English statute is inserted in the text as more useful to American students than the provisions of the later English Sale of Goods Act. This section has been re-enacted with some variations in all the American jurisdictions except Alabama, Arizona, Delaware, Illinois, Kansas, Ken- tucky, Louisiana, New IVIexico, North Carolina, Ohio, Pennsylvania, Rhode Island, Tennessee, Texas, Virginia, and West Virginia. The price is fixed at $30 in Arkansas, IVIaine, IVIissouri, and New Jersey; at $33 in New Hampshire; at $40 in Vermont; at $200 in California, Idaho, Montana, and Utah; at any price however small in Florida and Iowa; and at $50 in the other jurisdictions in which this section is in force. The Commissioners on Uniform State Laws have recommended a uniform Sale of Goods Act for the American states. This has been adopted in Arizona, Connecticut, Massachusetts, New Jersey, New York, Ohio, Rhode Chap, IV] STATUTE OF FRAUDS 111 III. Provisions of Sale of Goods Act. [The provisions of the Sale of Goods Act (56 & 57 Vict. c. 71, § 4) are as follows:] (1) A contract for the sale of any goods of the value of £10 or up- wards shall not be enforceable by action unless the buyer shall accept part of the goods so sold, and actually receive the same, or give some- thing in earnest to bind the contract, or in part payment, or unless some note or memorandum in writing of the contract be made and signed by the party to be charged or his agent in that behalf." (2) The provisions of this section apply to every such contract, not- withstanding that the goods may be intended to be delivered at some future time or may not at the time of such contract be actually made, procured, or provided, or fit or ready for dehvery, or some act may be requisite for the making or completing thereof, or rendering the same fit for deUvery.* (3) There is an acceptance of goods within the meaning of this section when the buyer does any act in relation to the goods which recognizes a pre-existing contract of sale, whether there be an acceptance in per- formance of the contract or not.* o This sub-section contains the substance of S 17, now repealed, of the Statute of Frauds. The language is altered so as to leave no doubt that the effect of this section, both as to form required and the effect of its absence, is identical with that of § 4 of the Statute of Frauds. b This sub-section embodies the section, now repealed, of Lord Tenterden's Act, which settled the doubt as to the operation of the 17th section of the Statute of Frauds upon an agreement to sell. Island, and some other states. The provisions in this act that correspond to § 17 of the original Statute of Frauds, as adopted in New York (Laws of 1911, chap. 571, § 85), are as foUows: 1. A contract to sell or a sale of any goods or choses in action of the value of fifty dollars or upwards shall not be enforceable by action unless the buyer shall accept part of the goods or choses in action so contracted to be sold or sold, and actually receive the same, or give something in earnest to bind the contract, or in part payment, or unless some note or memorandum in writing of the contract or sale be signed by the party to be charged or his agent in that behalf. 2. The provisions of this section apply to every such contract or sale, notwithstanding that the goods may be intended to be deUvered at some future time or may not at the time of such contract or sale be actually made, procured, or provided, or fit or ready tor delivery, or some act may be requisite for the making or completing thereof, or rendering the same fit for delivery; but if the goods are to be manufactured by the seller especially for the buyer and are not suitable for sale to others in the ordinary course of the seller's business, the provisions of this section shall not apply. 3. There is an acceptance of goods within the meaning of this section when the buyer, either before or after delivery of the goods, expresses by words or conduct his assent to becoming the owner of those specific goods. ' As to whether the subject-matter of the sale is personalty, and so within this section allowing one of three alternative methods of satisfying the statute and requiring that only if the article be above a certain value, or whether it is realty, and so within the "Fourth Section" requiring a writ- ing, however small the value, has been discussed. See ante, § 99; Hirth v. Graham, (1893) 50 Ohio St. 57; Higgins v. Kusterer, (1879) 41 Mich. 318; Northern v. Lathrop, (1848) 1 Ind. 113. 112 THE FORMATION OF CONTRACT [Chap. IV We have here to consider, as in the case of the 4th section of the Statute of Frauds — (1) The nature of the contract. (2) The form required. (3) The effect of non-compliance with these requirements. (1) NaMre of the contract 112. Contract of sale under English Sale of Goods Act. The statute ^ deals with the sale of goods, and goods are de- fined therein as "chattels personal other than things in action and money"; 2 but the words "contract of sale" include two sorts of agreement — a sale and an agreement to sell, and the 4th section deals with both. The essential difference appears in an earlier section of the Act. "Where under a contract of sale the property in the goods is trans- ferred from the seller to the buyer the contract is called a sale; but where the transfer of the property in the goods is to take place at some future time, or subject to some condition thereafter to be fulfilled, the contract is called 'an agreement to sell.'" ", The contract for the sale of goods may therefore contem- plate an instantaneous, or a future or conditional transfer of property in the goods; and a subsequent section of the Act supphes us with the tests which determine whether a contract is a sale or an agreement to sell. 113. Sale and agreement to sell. To constitute a sale the goods sold must be specific, they must be in a deliverable state, and the sale must be unconditional. If A orders any ten sheep out of X's flock the goods are not specific. If he orders a table which he sees in course of making in X's shop the goods are incomplete. If he buys X's stack of hay at so much a ton, the price to be ascertained when the hay is taken down and weighed, there is yet something to be done to fix the price. Where the conditions of a sale are satisfied the contract o 56 & 57 Vict. e. 71, § 1, Bub-s. 3. ' That is, the English "Sale of Goods Act." ' In the United States the statute of frauds governing the sale of per- sonal property is generally held to cover the sale of choses in action, and especially those in the nature of securities evidenced in some material form. Greenwood v. Law, (1892) 55 N.J. L. 168. But not a sale of an interest in an invention before a patent is obtained. Somerby v. Buntin, (1875) 118 Mass. 279. Cf. Jones v. Reynolds, (1890) 120 N.Y. 213: Walker v. Supple, (1875) 54 Ga. 178. Chap. IV] STATUTE OF FRAUDS 113 operates as a conveyance. When, and so soon as, the parties are agreed the property in the goods passes to the buyer: he has the remedies of an owner in respect of the goods them- selves besides an action ex contractu against the seller if the latter fail to carry out his bargain, or part with the goods to a third party: the goods stand at his risk; if they are de- stroyed the loss falls on him and not on the seller. It is further important to bear in mind, not only that the difference between a sale and an agreement to sell is the differ- ence between conveyance and contract, but that an agreement to sell may become a sale on the fulfillment of the conditions on which the property in the goods is to pass to the buyer. As a rule there is no great difficulty in determining whether, as a fact, these conditions have been fulfilled. But questions sometimes arise which admit of some doubt, in cases where there is an agreement for the purchase of goods which are not specific, and the seller has to appropriate the goods to the contract. Upon such appropriation the contract becomes a sale: it is therefore desirable to ascertain the precise moment at which property and risk pass to the buyer. If the buyer selects the goods to be appropriated, if he approves the selection made by the seller, or if the goods are delivered to a carrier on the authority of the buyer, the appro- priation takes place at the moment of approval, or of delivery. If however the seller has selected the goods on the authority of the buyer, but without his express approval, doubts may arise whether his selection is irrevocably binding upon him or whether it merely expresses an intention which he may alter. The question is one which I will not discuss here; it is a part of the subject of the special contract of sale." ^ 114. Sale or work and labor. A different sort of question has arisen in cases where skilled labor has been expended on the thing sold in pursuance of the contract, and before the property is transferred. It has been asked whether the contract is a con- tract of sale or for the hire of services. The law may be taken a Chalmers, Sale of Goods Act (7tb ed.)t P- 63 et seq. ' The operative facts necessary to pass title to a chattel at common law are not the same as those necessary to satisfy the requirements of the Sale of Goods Act or of § 17 of the Statute of Frauds. TJie statute may be satis- fied without passing title at all, and the statute is not necessarily satisfied even though enough has been done to satisfy the common-law requirements for passing title. It is only the Statute of Frauds with which we are con- cerned here. 114 THE FORMATION OF CONTRACT [Chap. IV to be now settled, that, whatever the respective values of the labor and the material, if the parties contemplate the ultimate delivery of a chattel the contract is for the sale of goods. ^ "I do not think," said Blackburn, J., "that the test to apply in these cases is whether the value of the work exceeds that of the ma- terials used in its execution; for if a sculptor was employed to execute a work of art, greatly as his skill and labor, supposing it to be of the highest description, might exceed the value of the marble on which he worked, the contract would in my opinion be nevertheless for the sale of a chattel." » (2) The form required 115. Three methods of satisfying statute. As to the form, it is enough to say that where, in absence of a part acceptance and receipt'' or part payment,' a note or memorandum in writ- o Lee 5. Griffin, (1861) 1 B. & S. 272. 1 In the United States the simple test established by the English court in Lee v. Griffin, and embodied in the Sale of Goods Act, has not generally been adopted. It prevails, perhaps in one or two states. Brown v. Sanborn, (1875) 21 Minn. 402; Hardell v. McClure, (1849, Wis.) 1 Chandl. 271; Burrell v. Highleyman, (1888) 33 Mo. App. 183. Two opposing views divide generally the American decisions. (1) The New York rule, as established by court decisions, was that if the article is in existence as a subject-matter of sale at the time of the formation of the contract, the contract is a sale and not one for work and labor, although the seller is to do some work upon the article to adapt it to the uses of the purchaser. Cooke v. Millard, (1875) 65 N.Y. 352. But otherwise if the article be not so in existence at the time of the formation of the contract. Parsons v. Loucks, (1871) 48 N.Y. 17. (2) The Massachusetts rule was that, "a contract for the sale of articles then existing, or such as the vendor in the ordinary course of his business manu- factures or procures for the general market, whether on hand at the time or not, is a contract for the sale of goods, to which the statute applies. But on the other hand, if the goods are to be manufactured especially for the pur- chaser, and upon his special order, and not for the general market, the case is not within the statute." Goddard v. Binney, (1874) 115 Mass. 450; In re Gies' Est., (1910) 160 Mich. 502; and see Pitkin v. Noyes, (1869) 48 N.H. 294. The English rule looks to the time of the performance of the contract. The New York rule looked to the time of the formation of the contract. The Massachusetts rule looked to the nature of the contract itself. See Benjamin on Sales, §§ 90-110, and Bennett's American notes; Mechem on Sales, §§ 294r-326. The American Sale of Goods Act closely adheres to the Massachusetts rule, which was the one most generally followed by the courts. See the New York statute, ante, § 110, note 1. ^ On acceptance and receipt as a means of satisfsring the 17th section, see Bennett's Benjamin on Sales, §§ 138-88 and American notes; Mechem on Sales, §§ 353-403; Williston on Sales, §§ 74r-97; Sarkisian v. Teale, (1909) 201 Mass. 596. ' On part payment as a means of satisfying the 17th section, see Ben- nett's Benjamin on Sales, §§ 189-200 and American notes; Mechem on Sales, §§ 404-21; Williston on Sales, §§ 98, 99; part payment in the form of Chap. IV] STATUTE OF FRAUDS 115 ing is required, the rules applicable to contracts under § 4 of the Statute of Frauds apply to contracts under the Sale of Goods Act^ with one exception. ii6. Whether consideration must appear. The consideration for the sale need not, under this section, appear in writing unless the price is fixed by the parties. It, then becomes a part of the bargain, and must appear in the memorandiim.^ Since the enactment only applies to contracts for the sale of goods, it will be presumed, if no consideration for the sale be set forth, that there is a promise to pay a reasonable price: but this pre- sumption may be rebutted by evidence of an express verbal agreement as to price, so as to show that a memorandum which does not contain the price is insufficient." ' ii6a. " Acceptance." The definition of "acceptance" in sub- section (3) should be noted. There is an acceptance within the meaning of § 4 when the buyer "does any act in relation to the goods which recognizes a pre-existing contract of sale, whether there be an acceptance in performance of the contract or not." An example will make this clear. If A has verbally ordered a cask of wine of a certain quality over the value of £10 and on its arrival draws a sample to test the quality, his action rec- ognizes a pre-existing contract; that is, it is only to be explained on the hypothesis that a contract exists. And therefore he had supplied the necessary evidence of a contract, even though he rejects the cask forthwith.* It is to be observed that § 4 of the Statute of Frauds, so far as relates to contracts not to be performed within a year is not repealed by § 4 of the Sale of Goods Act where contracts for the sale of goods are concerned. Acceptance or receipt of the goods in these circumstances does not therefore dispense with the note or memorandum in writing required by the earlier statute." Hoadley v. McLaine, (1834) 10 Bing. 482. h For what does not, and what does, constitute acceptance, see Page «. Morgan, (1885) 15 Q.B.D. 228; Taylor v. Smith, [1893] 2 Q.B. (C.A.) 65; and see Taylor n. Great Eastern Hallway Company, [1901] 1 K.B. 774. c Prested v. Gardner, [1910] 2 K.B. 776; [1911] 1 K.B. 425. services rendered is sufficient. Driggs v. Bush, (1908) 152 Mich. 53. Pay- ment on general account is enough to satisfy the statute as to all the items thereof, including those as to which there is no memorandum. Berwin v. Bolles, (1903) 183 Mass. 340. 1 On the note or memorandum as a means of satisfying the 17th section, see ante, §§ 101-06. And see Bennett's Benjamin on Sales, §§ 201-54, and American notes; Mechem on Sales, §§ 422-51; Williston, Sales, §§ 100-18. 2 Ide V. Stanton, (1843) 15 Vt. 685; Ashcroft «. Butterworth, (1884) 136 Mass. 511; Hanson v. Marsh, (1888) 40 Minn. 1. ' O'Neil V. Grain, (1878) 67 Mo. 250. 116 THE FORMATION OF CONTRACT [Chap. IV (3) Effect of norircomplianee with statute 117. Contract unenforceable. It remains to note that if there be no acceptance and receipt, no part payment, and no memo- randum or note in writing, the section declares that the con- tract shall not be "enforceable by action." The Sale of Goods Act has thus set at rest another question which, though practically settled had remained for a long time uncertain in the case of the 17th section of the Statute of Frauds. Like the 4th section of that statute, the require- ments of the Sale of Goods Act do not ^ect the validity of the contract, they only impose conditions as to its proof." ^ IV. CONSIDERATION 118. Consideration defined. I have stated that considera- tion is the universal requisite of contracts not imder seal, and this is generally true of such contracts, even when the law has prescribed a form in which they should be expressed, so long as the form is not that of a deed. It will be well therefore to start with a definition of consideration; and we may take that which is given in the case of Currie v. Misa : "A valuable consideration in the sense of the law may consist either in some right, interest, profit, or benefit accruing to one party, or some forbearance, detriment, loss, or responsibility given, suffered, or imder- taken by the other." '^ Consideration is something done, forborne, or suffered, or promised to be done, forborne, or suffered by the promisee in respect of the promise.' It must necessarily be in respect of a Taylor t. Gt. E. Railway, [1901] 1 K.B. 779. 6 (1875) L.R. 10 Exoh. 162. 1 See §§ 107-09, ante. 2 See Hamer v. Sidway, (1891) 124 N.Y. 538. "A benefit to the party promising, or a loss to the party to whom the promise is made." Cook v. Bradley, (1828) 7 Conn. 57. ' No single definition that has been given serves to explain all the cur- rently approved decisions. Consideration is a fact other than a seal, which, when it accompanies a promise, operates to create a legal duty in the promisor. Courts may give such operation (1) to facts long antecedent to the promise, (2) to contemporaneous facts regarded as the equivalent of and in exchange for the promise, and (3) to subsequent facts consisting of acts in rehanoe on the promise. "In all contract law our problem is to determine what facts will operate to create legal duties and other legal relations. We find at the outset that bare words of promise do not so operate. Our problem then becomes one of determining what facts must accompany promissory words in order to Chap. IV] CONSIDERATION 117 the promise, since consideration gives to the promise a binding force. 1 19. General rules. We may now lay down some general rules as to consideration: 1. It is necessary to the validity of every promise not under 2. It need not be adequate to the promise, but must be of some value in the eye of the law. 3. It must be legal. 4. It must be either present or future, it must not be past. 1. ConsideraUon is necessary to the validity of every simple contract 120. Necessity of consideration. The case of Pillans v. Van Mierop " shows that the rule which I have laid down was o (1765) 3 Burr. 1663. create a legal duty (and other legal relations). We must know what these facts are in order that we can properly predict the enforcement of repara- tion, either specific or compensatory, in case of non-performance. We are looking for a sufficient cause or reason for the legal enforcement of a promise. This problem was also before the Roman lawyers, and it must exist in all systems of law. With us it is called the problem of consideration." 27 Yale Law Journal, 362, 376. In Calthorpe's Case, (1574) 2 Dyer, 336b, 34, it was said: "A considera- tion is a cause or meritorious occasion, requiring a mutual recompense, in fact or in law. Contracts and bargains have a quid pro quo." It will be observed that the definition of the author as stated above differs from that given in the quotation from Currie v. Misa. The author's defini- tion would require consideration always to be a detriment to the promisee, while by the other definition a benefit to the promisor might be sufficient even though the promisee incurs no detriment. The definition most com- monly given by the courts is in the alternative form — a benefit to the promisor or a detriment to the promisee, and it seems to represent the pre- vailing law. See Samuel WiUiston, " Consideration in Bilateral Contracts," (1914) 27 Harvard Law Review, 518, 524; Edmund M. Morgan, " Benefit to Promisor as Consideration," (1917) 1 Minnssola Law Review, 383. A decision clearly in agreement is Union Bank v. Sullivan, (1915) 214 N.Y. 332. See also infra, § 128, note. For general discussion of this topic, see: Ashley, 26 Harvard Law Review, 429; Ames, 2 Harvard Law Review, 14; 12 ibid. 521, 13 iMd. 29, 37; Ballantine, 11 Michigan Law Review, 423, 28 Harvard Law Review, 121 ; WiUiston, 8 Harvard Law Review, 29, 27 ibid. 503; 2 Street, Foundations of Legal Liability. The idea that consideration must always be a detriment to the promisee arose from the suggestion that its origin and character must be sought solely in the history of the common-law action of assumpsit. That action did, indeed, play a leading part in the development of contract law; but we must look to other sources as well, particularly to equity and to the common- law action of debt to determine the application and limits of the present nebulous doctrine of consideration. 118 THE FORMATION OF CONTRACT [Chap. IV still open to question in the year 1765. Lord Mansfield held that consideration was only one of several modes for supply- ing evidence of the promisor's intention to bind himself; and that if the terms of a contract were reduced to writing by reason of conamercial custom, or in obedience to statutory requirement, such evidence dispensed with the need of consideration. The question arose again in 1778. In Bann v. Hughes,'^ Mrs. Hughes, administratrix of an estate, promised in writing to pay out of her own pocket money which was due from the estate to the plaintiff. There was no consideration for the promise, and it was contended that the observance of the form required by § 4 of the Statute of Frauds made consideration unnecessary. The case went to the House of Lords. The opinion of the judges was taken and was thus delivered by Skynner, C.B. : "It is undoubtedly true that every man is by the law of nature bound to fulfill his engagements. It is equally true thai the law of this country supplies no means nor affords any remedy to compel the perform- ance of an agreement made mthout sufficient consideration. Such an agreement is 'nudum pactum ex quo non oritur actio'; and whatsoever may be the sense of this maxim in the civil law, it is in the last-men- tioned sense only that it is to be understood in our law. ... All con- tracts are by the law of England divided into agreements by specialty and agreements by parol; nor is there any such third class as some of the counsel have endeavored to maintain as contracts in writing. If they be merely written and not specialties, they are parol and a con- sideration must be proved." i 121. Consideration the uniform test. We here get a rule of universal application, a uniform test of the actionability of every promise made by parol. In each case we must ask. Does the promisor get any benefit or the promisee sustain any detri- ment, present or future, in respect of the promise? If not; the promise is gratuitous, and is not binding. In working out this doctrine to its logical results it has, no doubt, happened from time to time that the courts have been compelled to hold a promise to be invalid which the parties intended to be binding," o (1778) 7 T.R. 350, note. ' "A mere written contract is upon the footing of a parol contract, and a consideration must be proved. This is an inflexible rule of law; and the court is not at liberty, if it had the disposition, to subvert it." Cook «. Bradley, (1828) 7 Conn. 57. But statutes in some States give to written contracts a presumption of consideration. See § 88, note, ante. ' As in the case of part payment of a debt in consideration of a promise to release the balance. See § 140, post. Chap. IV] CONSIDERATION 119 or that the slightness of the benefit or detriment which may constitute a consideration has tended to bring the require- ment into ridicule.' English lawyers will recognize the force of the following observations by a learned Law Lord who had been trained under another system of jurisprudence: " I confess that this case is to my mind apt to nip any budding affec- tion which one might have had for the doctrine of consideration. For the effect of that doctrine in the present case is to make it possible for a person to snap his fingers at a bargain deliberately made, a bargain not in itself mif air, and which the person seeking to enforce it has a legiti- mate interest to enforce. Notwithstanding these considerations I cannot say that I have ever had any doubt that the judgment of the Court of Appeal was right." <• But the value of the rule must be tested by its practical convenience. We need some means of ascertaining whether the maker and receiver of a promise contemplated the crea- tion of a legal liability. ^ The rule, or doctrine, of consideration affords a uniform test for this purpose; and it may be ques- tioned whether the general convenience is not better served by adopting this test in its logical completeness than by allowing distinctions and subtilties to refine the rule away.' . i 122. Exceptions. Two exceptions we may note to the imi- versality of the rule. (1) The promise of a gratuitous service, although not en- forceable as a promise, involves the duty of using ordinary care and skill in performance.* (2) In dealings arising out of negotiable instruments, such as bills of exchange and promissory notes, a promise to pay money may be enforced though the promisor gets nothing and the promisee gives nothing in respect of the promise.'' ^ a Lord Dunedin in Dunlop v. Selfridge, [1915] App, Cas. 847, 855. b See §§ 316-25, post. 1 See Jaffray v. Davis, (1891) 124 N.Y. 164; Clayton v. Clark, (1896) 74 Miss. 499. * The requirement of consideration is not merely to test the promisor's intention to assume a legal duty. It seems more accurate to say that con- sideration is the criterion to determine whether the customary notions of justice prevailing in the community require the legal enforcement of a prom- ise. In this aspect the idea of consideration assimilates itself to the idea of causa in the Roman and Continental law, and the two ideas differ only where the mores of the two communities differ. ' See Ames, " Two Theories of Consideration," 12 Harvard Law Review, 515, 13 Md. 29. « See §§ 133-34, post. 6 See Hoffman v. Bank, (1870, U.S.) 12 WaU. 181, 190. And see Nego- tiable Inst. Law, § 26 (N.Y. § 52). 120 THE FORMATION OF CONTRACT [Chap. IV These two exceptions represent legal obligations recognized in the courts before the doctrine of consideration was clearly- formulated; they were engrafted upon the common law, in the first case from the historical antecedents of contract, in the second from the law merchant. It is better to recognize these exceptions, to define them and to note their origin, than to apply the doctrine of consideration by forced and artificial reasoning to legal relations which grew up outside it. 2. Consideration need not be equal to the promise in market value, bid mvM be of some value ' 123. Market value of consideration immaterial. Courts of law will not make bargains for the parties to a suit, and, if a man gets what he has contracted for, will not inquire whether it was an equivalent to the promise which he gave in return. The consideration may be a benefit to the promisor, or to a third party, or may be of no apparent benefit to anybody, but merely a detriment to the promisee: in any case "its adequacy is for the parties to consider at the time of making the agree- ment, not for the court when it is sought to be enforced." " ^ The following case will illustrate the rule. Bainbridge owned two boilers, and at the request of Firm- stone allowed him to weigh them on the terms that they were restored in as good a condition as they were lent. Firmstone took the boilers to pieces in order to weigh them and returned them in this state, and for breach of his promise Bainbridge sued him. The defendant was held liable. " The consideration is that the plaintiff, at the defendant's request, had consented to allow the defendant to weigh the boilers. I suppose the defendant thought he had some benefit: at any rate there is a detriment to the plaintiff from his parting with the possession for ever so short a time." * a Per Blackburn, J., Bolton v. Madden, (1873) L.R. 9 Q.B. 55. b Bainbridge v. Firmstone, (183S) 8 A. & E. 743. ' But the consideration is required to be adequate where the contract merely calls for an exchange of different sums of money at the same time, or at different times when the parties do not look upon the element of time as an equivalent. Schnell v. Nell, (1861) 17 Ind. 29; Shepard v. Rhodes, (1863) 7 R.I. 470. Cf . Peabody v. Speyers, (1874) 56 N.Y. 230 (sale of gold for currency). 2 Devecmon v. Shaw, (1888) 69 Md. 199; Hamer v. Sidway, (1891) 124 N.Y. 538; Dunton v. Dunton, (1892) 18 Vict. L.R. 114 (living soberly and respectably). Chap. IV] CONSIDERATION 121 In Haigh v. Brooks," the consideration of a promise to pay certain bills of a large amount was the surrender of a docu- ment supposed to be a guarantee, which turned out to be unenforceable. The worthlessness of the docimient surrendered was held to be no defense to an action on the promise. "The plaintiffs were induced by the defendant's promise to part with something which they might have kept, and the defendant ob- tained what he desired by means of that promise." ' In De la Bere v. Pearson,'' Vaughan WiUiams, L.J., thus de- scribed the contract sued upon : "The defendants advertised, offering to give advice with reference to investments. The plaintiff, accepting that offer, asked for advice, and asked for the name of a good stockbroker. The questions and answers were, if the defendants chose, to be inserted in their paper as published; such publication might obviously have a tendency to in- crease the sale of the defendants' paper. I think that this offer, when accepted, resulted in a contract for good consideration." Equity treats inadequacy of consideration as corroborative evidence of fraud or undue influence, such as may enable a promisor to resist a suit for specific performance, or get his promise canceled. But mere inadequacy of consideration, un- less, in the words of Lord Eldon, it is so gross as "to shock the conscience and amount in itself to conclusive evidence of fraud," " is not of itself a groimd on which specific performance of a contract will be refused.^ 124. Types of sufficient consideration; executed and execu- tory. Though consideration need not be adequate it must sat- isfy certain requirements. This leads us to ask what is meant by saying that consideration must be "something of some value in the eye of the law." a (1840) 10 A. & E. 309. b [19081 1 K. B. 280, 287. c Coles V. Trecothick, (1804) 9 Ves. 246. ' Judyu. Louderman, (1891) 48 Ohio St. 562 (parting with a document); Brooks V. Ball, (1820, N.Y.) 18 Johns. 337 (promise to pay disputed claim if promisee would make oath to its correctness); Wolford v. Powers, (1882) 85 Ind. 294 (promisee names child after promisor); Gardner v. Denison, (1914) 217 Mass. 472 (same), 51 L.R.A. (N.S.) 1108, and note; Hoshor v. Kautz, (1898) 19 Wash. 258; Sykes v. Chadwick, (1873, U.S.) 18 Wall. 141 (release of supposed right of dower); Kinsman v. Parkhurst, (1855, U.S.) 18 How. 289 (license to use invalid patent). "The distinction must be care- fully observed, however, between a bargain for the paper, and a bargain for the title, right, or obligation which the paper was supposed to give." Wald's Pollock on Cont., Williston's ed., 194. 2 Seymour v. De Lancy, (1824, N.Y.) 3 Cow. 445; Franklin Co. v. Harri- son, (1892) 145 U.S. 459; HaU v. Perkins, (1829, N.Y.) 3 Wend. 626. 122 THE FORMATION OF CONTRACT [Chap. IV The definition of consideration, supplied by the Court of Exchequer Chamber in Curne v. Misa," amounts to this — that consideration is something done, forborne, or suffered, or promised to be done, forborne, or suffered, by the promisee in respect of the promise. Therefore it may be, (1) a present act, forbearance, or sufferance, constituting either the offer or the acceptance of one of the parties, and being all that can be re- quired of him imder the contract; or (2) a promise to do, for- bear, or suffer, given in return for a like promise. In the first case the consideration is present or executed, in the second it is future or executory.^ The offer of a reward for information, accepted by the supply of the information required; the offer of goods, accepted by their use or consumption, are illustrations of executed consideration. a (1875) L.R. 10 Exoh. 162. 1 This distinction is that existing between bilateral and unilateral con- tracts. See ante §§ 36-39. There has been much discussion as to the reasons for holding that a promise is a sufficient consideration for another promise, and as to what kinds of promises are sufficient. The subject cannot be fuUy discussed within the limits of these notes. It is not every promise that is a sufficient consideration for a return promise. The test has been stated as follows: "Where the doing a thing will be a good consideration, a promise to do that thing will be so too." Holt, L.C.J., in Thorp v. Thorp, (1701) 13 Mod. 455. "So far as regards the matter of the consideration, as being executed or executory it may be observed that whatever matter, if executed, is sufficient to form a good executed consideration; if promised, is sufficient to form a good executory consideration: so that the distinction of executed and execu- tory consideration has no bearing upon the question of the sufficiency of any particular matter to form a consideration." Leake, Contracts (1st ed.), p. 314; (2d ed.), pp. 612, 613. See Professor S. W. Williston, "Consideration in Bilateral Contracts," 27 Harvard Law Review, 503, 518. A promise is generally held to be a valid consideration for a return promise even though it is voidable for infancy; Holt v. Ward, (1732) 2 Strange, 937; or for insanity; Atwell v. Jenkins, (1895) 163 Mass. 362. The weight of authority also is that where a bilateral contract is within the statute of frauds, the contract is enforceable against the one who has signed even though the other party has not signed, the latter's oral promise being valid consideration. See notes 28 L.R.A. (N.S.) 680; 43 L.R.A. (N.S.) 410; contra, Houser v. Hobart, (1912) 22 Idaho, 735. The theory that consideration must always be a detriment to the promisee is not properly applicable to bilateral contracts. See 2 Street, Foundations of Legal LiabiUty; Holdsworth in 11 Michigan Law Review, 347; Corbin, "Does a Pre-existing Duty Defeat Consideration?" (1918) 27 YcHe Law Jowmal, 362, 374. For further discussions see Ames, "Two Theories of Consideration," 12 Harvard Law Review, 515; Williston, "Successive Promises of the Same Performance," 8 Harvard Law Review, 27; Langdell, "Mutual Promises as a Consideration," 14 Harvard Law Review, 496. Chap. IV} CONSIDEEATION 123 Mutual promises to marry; a promise to do work in return for a promise of payment, are illustrations of executory considera- tion. And the fact that the promise given for a promise may be dependent upon a condition does not affect its validity as a consideration. A promises X to do a piece of work for which X promises to pay if the workmanship is approved by M. The promise of X is consideration for the promise ol A.^ 125. Tests of sufficiency. In the application of this rule we must ask, when action is brought upon a promise: (a) Did the promisee do, forbear, suffer, or promise anything in respect of the promise to him? (b) Was his act, forbearance, sufferance, or promise of any ascertainable value? (c) Was it more than he was akeady legally bound to do, forbear, or suffer? On the answer to these questions depends the legally opera- tive character of the consideration. (a) First test of sufwieney of consideration 126. The two rules. Apart from the opinions expressed by Lord Mansfield,* we find cases in comparatively modern times which have raised a doubt whether consideration, under certain circumstances, is necessary to make a promise actionable. The cases have resulted in the establishment of two rules: Motive is not the same thing as consideration. Consideration must move from the promisee. 127. Inducing cause and subsequent reliance. Motive. In Thomas v. Thomas," a widow sued her husband's executor for breach of an agreement to allow her to occupy a house, which had been the property of her husband, on payment of a small portion of the grotmd-rent. The executor in making o (1842) 2 Q.B. 851. ' Duplex Safety BoUer Go. v. Garden, (1886) 101 N.Y. 387; Adams Radiator & BoUer Works v. Schnader, (1893) 155 Pa. 394; Ray v. Thompson, (1863, Mass.) 12 Gush. 281; Wells v. Alexandre, (1891) 130 N.Y. 642; Lima L. & M. Go. V. National Steel Castings Go., (1907) 155 Fed. 77, 11 L.R.A. (N.S.) and note. In all aleatory, or wagering contracts the promises are expressly conditional upon some uncertain event, and yet it is never held that such promises are insuflScient as consideration. Christie v. Borelly, (1860) 29 L.J. G.P. 153; Seward v. MitcheU, (1860, Tertn.) 1 Gold. 87; Earl of March v. Pigot, (1771) 5 Burr. 2802. ' See § 120 ante. 124 THE FORMATION OF CONTRACT [Chap. IV the agreement was carrying out a wish expressed by the deceased that his wife should have the use of the house. The court held that the desire to carry out the wishes of the deceased would not amount to a consideration. "Motive is not the same thing with consideration. Consideration means something of some value in the eye of the law, moving from the plaintiff." But it was further held that the undertaking to pay ground-rent by the plaintiff was a consideration for the defendant's promise, and that the agreement was binding.^ ^ The word "motive" is a word that may be used either subjectively or objectively. In the latter sense, the promisor's motive is the objective fact that he desires. In the former sense, his motive is his subjective desire itself. In the latter sense, motive is never a consideration; but in the former sense, motive and consideration may be identical. There are many dicta to the effect that consideration for a promise must be ai least one of the objective inducements or causes of the promise. Thus, in Martin v. Meles, (1901) 179 Mass. 114, Mr. Justice Holmes says: "Of course the mere fact that a promisee relies upon a promise made without other consideration does not impart validity to what before was void. There must be some ground for saying that the acts done in reliance upon the promise were contemplaied by the form of the transaction either impliedly or in terms as the conventional motive, inducement, and equivalent for the promise. But coxarta have gone very great lengths in discovering the implication of such an equiva- lence, sometimes, perhaps even having found it in matters which would seem to be no more than conditions or natural consequences of the promise." See also Wisconsin & Mich. R.R. Co. v. Powers, (1903) 191 U.S. 379, 386. It may be stated without hesitation that the consideration need not be the sole, or even the chi^, objective inducement and cause of the promise. The causes and motives of human action are always complex, and the fact that a contractor had other inducements which might have been sufficient in themselves to cause him to perform is not material. This is the doctrine of Thomas v. Thomas, supra. See also De Cicco v. Schweizer, (1917, N.Y.) 117 N.E. 807, discussed by the present editor in 27 Yale Law Journal, 362, 366. Likewise, there are many inducing causes for making a promise that are not legally operative as a consideration; e.g., see Schnell v. NeU, (1861) 17 Ind. 29. In the numerous cases where it is held that a past consideration is suffi- cient, it is certain that the consideration is not the inducing cause of the promise; that is, it is not the promisor's object of desire, because it has already been attained. See post, §§ 148-62. In the quotation from Martin v. Meles, sapra, while asserting that a promise does not become binding merely because the promisee relies upon it, Mr. Justice Holmes admits that acts have frequently been held to be a sufficient consideration even though they were mere conditions or conse- quences of the promise and not an inducing cause thereof. Indeed, there are many cases justifying the statement that consideration may consist of acts in reliance upon a promise even though they were not specified as the agreed equivalent and inducement, provided the promisor ought to have foreseen that such action wovld take place and the promisee reasonably believes it to be de- sired. See the following cases: Traver v. , (1661) 1 Sid. 57; Wild v. Harris, (1849) 7 C.B. 999; MiUward v. Littlewood, (1850) 5 Exch. 775; Brooks V. Ball, (1820) 18 Johns. 337; Wigan v. Eng. etc. Life Ass. Ass'n, Chap. IV] CONSIDERATION 125 The confusion of motive and consideration has appeared in other ways. , Good consideration. The distinction between good and valvr able consideration, or family affection as opposed to money value, is only to be found in the history of the law of real property.' Moral consideration. Motive has most often figured as con- sideration in the form of a moral obligation to repay benefits received in the past. It is clear that the desire to repay or re- ward a benefactor is indistinguishable, for our purposes, from a desire on the part of an executor to carry out the wishes of a deceased friend, or a desire on the part of a father to pay the debts of his son. The mere satisfaction of such a desire, un- accompanied by any present or future benefit accruing to the promisor or any detriment to the promisee, cannot be regarded as of any value in the eye of the law." '^ a Mortimore v. Wright, (1840) 6 M. & W. 482. [1909] 1 Ch. 291, 298 {semble; "ex post facto consideration"); Devecmon v. Shaw, (1888) 69 Md. 199; Dunton v. Dunton, (1892) 18 Vict. L.R. 114; ShadweU v. ShadweU, (1860) 30 L.J. C.P. 145; Ricketts v. Scothom, (1898) 57 Neb. 51; State v. Lattanner, (Ohio, 1916) 113 N.E. 1045; L.R.A. 1917 B, 684, and note; Union Bank v. Sullivan, (1915) 214 N.Y. 332; DeCicco v. Schweizer, (1917, N.Y.) 117 N.E. 807; State Bank v. Kirk, (1907) 216 Pa. 452; Skordal v. Stanton, (1903) 89 Minn. 611; Hay v. Fortier, (1917, Me.) 102 Atl. 294; see also post, § 142, "Mutual Subscriptions " ; Martin v. Meles, supra. A promise by the owner of land to make a gift thereof will be specifically enforced in equity if the donee is induced thereby and in reliance thereon to go into possession and make valuable improvements. Expenditures of this sort in money or labor, are held to "constitute a consideration for the promise." Messiah Home ti. Rogers, (1914) 212 N.Y. 315; Freeman v. Freeman, (1870) 43 N.Y. 34; Leavey v. Drake, (1882) 62 N.H. 373; Neale v. Neale, (1869) 76 U.S. 1; 1 Ames Cases Eq. 306, 308, citing many cases in notes. > Fink V. Cox, (1820, N.Y.) 18 Johns. 145; Stovall v. Bamett, (1823, Ky.) 4 Littell, 207. The doctrine of good consideration (i.e., relationship) has no application except in conveyancing imder the Statute of Uses or in marriage settlements. See the arguments of counsel in Sharington v. Strotton, (1566) 1 Plowden, 298. Only a valuable consideration will support an executory promise. Fischer v. Union Trust Co., (1904) 138 Mich. 612; 68 L.R.A. 987. * While it is true that the mere subjective desire of the promisor is not a sufBcient consideration, nevertheless in many instances the objective facts of the past, out of which that desire grew, constitute a sufficient cause and consideration for the enforcement of the promise {post, §§ 145-52). This is no doubt because the courts feel the weight, in those instances, of the social pressure called moral obligation. Moral obligation, so-called, and the facts causing such moral obligation, are generally stated not to be a sufficient consideration. Cook v. Bradley, (1828) 7 Conn. 57; Mills v. Wyman, (1826, Mass.) 3 Pick. 207; Strevell v. Jones, (1905) 106 App. Div. N.Y. 334; East- 126 THE FORMATION OF CONTRACT [Chap. IV At the end of the eighteenth, and beginning of the nineteenth century, the moral obligation to make a return for past benefits had obtained currency in judicial language as an equivalent to consideration. The topic belongs to the discussion of past as distinguished from executed or present consideration, but it is well here to insist on the truth that past consideration is no consideration, 1 and that what the promisor gets in such a case is the satisfaction of motives of pride or gratitude. The question was settled once for all in Eastwood v. Kenyan,'' and a final blow given to the doctrine that past benefits would support a subsequent promise on the ground of the moral obligation resting on the promisor.^ "The doctrine," says Lord Denman, "would annihilate the necessity for any con- sideration at all, inasmuch as the mere fact of giving a promise creates a moral obligation to perform it." 128. Must consideration move from the promisee? It has been argued that where two persons make a contract in which one of them promises to confer benefits upon a third party, the third party can sue upon the contract for the money or other benefit which it is agreed that he should receive. The matter concerns mainly the operation of contract, but it is plain that if such a contention were well founded, a man could sue on a promise not made to him, nor supported by any consideration which he had furnished.' a (1840) 11 A. & E. 438. wood V. Kenyon, (1840) 11 A. & E. 438; notes in L.R.A. vol. 53, p. 353, vol. 26 (N.S.), p. 436, vol. 7 (N.S.), p. 1048, vol. 26 (N.S.), 520. In a few states by statute and in some by judicial decision a strong moral obligation may sup- port a promise. Ga. Code, (1895) § 3658; Gray v. Hamil, (1889) 82 Ga. 375; Robinson v. Hurst, (1893) 78 Md. 59; Holden v. Banes, (1891) 140 Pa. 63; Spear v. GriflBth, (1877) 86 111. 652. And see the reasoning in Edwards v. Nelson, (1883) 51 Mich. 121. 1 That is, " no agreed equivalent." ' Cf. note 1, supra. • This involves two questions: (1) May a party for whose benefit a con- tract is made, but who is not himself a promisee or assenting party (in privity), maintain suit against the promisor? "The right of a party to maintain assumpsit on a promise not under seal, made to another for his benefit, although much controverted, is now the prevailing rule in this coimtry." Mr. Justice Davis, in Hendrick v. Lindsay, (1876) 93 U.S. 143, 149. For a discussion of this point, see post, §§ 280-91. (2) May a promisee who gave no consideration maintain suit where the promisor received a consideration therefor from a third person? It has been held in England that he cannot. Dunlopti. Selfridge, [1915] A.C. 847: cf. West Yorkshire ». Coleridge, [1911] 2 K.B. 326. It has been held in America that if the promise is made direcUy to the plaintiff, he may recover upon it although the consideration moves from another. Rector v. Teed, (1890) 120 N.Y. 583; Palmer Sav. Bk. v. Ins. Co., (1896) 166 Mass. 189; Van Eman v. Stanchfield, Chap. IV] CONSIDERATION 127 It was at one time held that where A made a binding prom- ise to X to do something for the benefit of the son or daughter of X, the nearness of relationship, and the fact that the con- tract was prompted by natural affection, would give a right of action to the person interested." ^ This, however, is no longer law. "Our law knows nothing of a jus quaesitum tertio arising by way of contract. Such a right may be conferred by way of property, as, for example, under a trust, but it cannot be conferred on a stranger to a contract as a right to enforce the contract in personam." '' * But where an agent is instructed to obtain a promise for his principal and to provide consideration, the consideration moves from the principal, not from the agent; though the party from whom the consideration moves must in truth have been con- tracting as agent for the party claiming the benefit of the contract." The case of the broker who is instructed to procure a marine insurance pohcy on behalf of a client may perhaps at first sight appear to be an exception to this rule, for by the law merchant the broker alone, and not the client, was liable to the underwriter for the premium, a liability now made statutory by the Marine Insurance Act, 1906.'' The effect therefore of this long-recognized custom is that the imderwriter, having agreed with the client for payment of the premium, agrees also to take the credit of the broker instead of the client. This is not, as Lord Esher pointed out in Universo Company v. Merchant's Marine Insurance,' a contradiction of the terms of the policy, but a mode of canying them out; and since the client is bound a Dutton v. Poole, (1677) 2 Lev. 210. b Lord Haldane, Dunlop v. Selfridge, [1915] A.C. 847, 853. c Duslop V. Selfridge, supra. d 6 Edw. VII, o. 41, § 53. e [1897] 2 Q.B. 93, 96. ' (1879) 10 Minn. 255 (discusses the specific point at length). It is often on this ground that compositions with creditors are sustained (see post, § 141), and also agreements to make mutual subscriptions for charitable or other purposes (see post, § 142, note). See also Gardner v. Denison, (1914) 217 Mass. 492; Eaton v. Ldbbey, (1896) 165 Mass. 218; cf. Furbish v. Goodnow, (1867) 98 Mass. 296. '■ Dutton V. Poole is sometimes followed in this country. Schemerhom V. Vanderheyden, (1806, N.Y.) 1 Johns 139; Buchanan v. Tilden, (1899) 158 N.Y. 109; Lawrence v. Oglesby, (1899) 178 111. 122. See §§ 284-91, post. 2 It has been contended by many that the right of a cestui que trust is not a property right but is a mere right in personam. Whether it should be clas- sified as one or the other, the recognition of such rights in beneficiaries who are not "in privity" and who gave no consideration is curiously out of harmony with the refusal to recognize rights in the beneficiary of a contract. 128 THE FOEMATION OF CONTRACT [Chap. IV to supply the broker with the necessary funds for pasdng the underwriter, we may still say that the consideration moves from the client/ even though, by virtue of the custom referred to, the underwriter is only entitled to sue the agent and not the principal for the premium which the latter has agreed to pay. And so the rule holds true that a promisor cannot be sued on his promise if he made it merely to satisfy a motive or wish, nor can he be sued on it by one who did not furnish the con- sideration on which the promise is based. (&) Second test of sufficiency of consideration We now come to the class of cases in which the consideration turns out to be of no ascertainable value. 129. Obvious impossibilily. Physical or legal impossibility, obvious upon the face of the contract, makes the consideration unreal. The impossibility must be obvious, such as is "according to the state of knowledge of the day, so absurd that the parties could not be supposed to have so contracted." If it is only a practical impossibility, present or subsequent, such as would arise from the death or destruction of the subject of the con- tract, unknown to the parties or unexpected by them when the contract was made, the effect would be different. The contract might be avoided in the first case on the groxmd of mistake, or discharged in the second case on the ground of subsequent impossibility. But a promise to pay money in consideration of a promise to discover treasure by magic, to go round the world in a week, or to supply the promisor with a live pterodactyl, would be void for unreality in the consideration furnished.^ And an old case furnishes us with an instance of a legal impossibility. A bailiff was promised £40 in consideration of a promise made by him that he would release a debt due to his 1 Just as in the case of other legal fictions, " we may still say " what we please, in order to produce the desired result without admitting that we axe infringing upon a supposedly invariable rule. " This expression has been criticized. See 7 Col. Law Review, 448. The word "unreal" is doubtless iU-chosen, but the author is not wholly without defense in ascribing the invalidity of the contract to lack of consideration. If the parties know of the impossibility, there may be said to be no intention to make a contract; but whatever their intention may have been, it is sub- mitted that the courts would not sustain a suit for damages for non-per- formance of the impossible promise. If they did not know of the impossi- bility, the transaction is said to be void because of mistake. Chap. W] CONSIDERATION 129 master. The court held that the baUiff could not sue; that the consideration furnished by him was "illegal," for the servant cannot release a debt due to his master. By "illegal" it is plain that the court meant legally impossible." i 130. Uncertainty. Agam, a promise which purports to be a consideration may be of too vague and imsubstantial a char- acter to be enforced. A son gave a promissory note to his father: the father's executors sued him upon the note, and he alleged that his father had promised to discharge him from liability in con- sideration of a promise on his part that he would cease from complaining, as he had been used to do, that he had not en- joyed as many advantages as his brothers. It was said that the son's promise was no more than a promise "not to bore his father," and was too vague to form a consideration for the father's promise to waive his rights on the note.* ^ So too promises to pay such remuneration as shall be deemed right; " to retire from the practice of a trade so far as the law allowsf have been held to throw upon the courts a respon- sibility of interpretation which they are not prepared to as- sume. These cases correspond with offers held to be incapable of creating legal relations, as described in § 55.' 131. Forbearance to sue. Cases occur in which it is hard to determine whether the consideration is or is not sufficient. A good illustration of such cases is afforded by promises of for- bearance to exercise a right of action or agreements to com- promise a suit. A forbearance to sue, even for a short time, is consideration a Harvey v. Gibbons, (1676) 2 Lev. 161. 6 White v. Bluett, (1853) 23 L.J. Exoh. 36. c Taylor v. Brewer, (1813) 1 M. & S. 290. d Davies v. Davies, (1886) 36 Ch. D. 359. 1 Beebe v. Johnson, (1838, N.Y.) 19 Wend. 500 (cf. Adams v. Messinger, (1888) 147 Mass. 185); Stevens v. Coon, (1843, Wis.) 1 Pinney, 356; MerriU V. Packer, (1890) 80 la. 542. 2 In the absence of a command from the father, the son would be privi- leged to make complaints. A forbearance to exercise this privilege seems to be perfectly definite and to be worth the money. A promise to pay a divorced wife an allowance if she would conduct herself with sobriety and in a respectable, orderly and virtuous manner, was held to rest upon a sufficiently definite consideration. Dunton v. Dunton, (1892) 18 Vict. L.R. 114. ' Sherman v. Kitsmiller, (1827, Pa.) 17 Serg. & R. 45; Hart v. Georgia R., (1897) 101 Ga. 188; Marble v. Standard Oil Co., (1897) 169 Mass. 553; United Press v. N.Y. Press Co., (1900) 164 N.Y. 406; Fairplay School Tp. v. O'Neal, (1890) 127 Ind. 95. But that is certain which can be rendered cer- tain. Caldwell v. School Dist., (1893) 55 Fed. 372. 130 THE FOEMATION OF CONTRACT [Chap. IV for a promise, although there is no waiver or compromise of the right of action. 1 In the Alliance Bank v. Broom," Messrs. Broom were asked to give security for moneys owing by them to the bank. They promised to assign the dociraients of title to certain goods; they failed to do so, and the bank sued for specific performance of the promise. The court held that "although there was no promise on the part of the bank to abstain for any certain time from suing for the debt, the efifect was that the bank did give and Messrs. Broom received the benefit of some degree of forbearance, not indeed for any definite time, but at all events some degree of forbearance." ' To use the expression adopted by the court in a similar case, the promise to give security "stayed the hand of the creditor." On the other hand, "where there is no communication of the security, where there is no express agreement, and there are no circumstances from which the court can imply any agreement, then there is no possibility of its bemg said with any justice that any consideration has been given at all." * ' But in order that the forbearance should be a consideration some liability must be shown to exist,* or to be reasonably supposed to exist by the parties.^ In Jones v. Ashbumham' action was brought on a promise to pay £20 to the plaintiff a (1864) 2 Dr. & Sm. 289. b Wigan v. English & Scottish &c. Association, [1909] 1 Ch. 291 at p. 298. c (1804) 4 East. 465. 1 Pennsylvania Coal Co. v. Blake, (1881) 85 N.Y. 226. ' Actual forbearance, relying on the promise, although the promisee is not bound to forbear, is a good consideration if it is agreed upon as such; but if the oflFer empowers the offeree to accept only by making a promise, an actual forbearance is no acceptance. In the first case there is a unilateral contract; in the second it must be bilateral. See Strong v. SheflBeld, (1895) 144 N.Y. 392; Edgerton v. Weaver, (1882) 105 111. 43; Miles v. New Zealand Alford Est. Co., (1886) 32 Ch. D. 266; cf. Hay v. Fortier, (1917, Me.) 102 Atl. 294. The following cases failed to see the possihiMty of a unilateral contract; Manter ». Churchill, (1879) 127 Mass. 31;' Shupe v. Galbraith, (1858) 32 Pa. 10. • In this case there was actual forbearance, but it was not agreed upon as the equivalent of a promise nor was it shown to have been given as the con- sequence of a promise. « Foster v. Metts, (1877) 55 Miss. 77; Fink v. Smith, (1895) 170 Pa. 124; Taylor v. Weeks, (1901) 129 Mich. 233. ' Mulholland v. Bartlett, (1874) 74 111. 58; Barlow v. Ocean Ins. Co., (1842, Mass.) 4 Met. 270; Palfrey v. Portland R., (1862, Mass.) 4 Allen, 55. If the claim is void as a matter of positive and unquestioned law, forbear- ance is not a sufficient consideration. Loydo. Lee, (1718) 1 Stra. 94; Herring V. Dorell, (1840) 8 Dowl. Prac. Cas. 604; cf . Cook v. Wright, (1861) 1 B. & S. 559. Chap. IV] CONSIDERATION 131 in consideration of his forbearance to sue for a debt which he alleged to be due to him from a third party deceased. The pleadings did not state that there were any representatives of the dead man towards whom this forbearance was exercised, nor that he had left any assets to satisfy the claim. It was a mere promise not to sue persons unknown for a sum which was not stated to be in existence or recoverable, and was held to be no consideration for a promise. "How," said Lord Ellen- borough, "does the plaintiff show any damage to himself by forbearing to sue when there was no fund which could be the object of stiit, when it does not appear that any person in rerum naiura was liable to him? " * 132. Compromise of suit. The compromise of a suit furnishes consideration of the same character. ^ In the case of forbear- ance the offer may be put thus: "I admit your claim but will do or promise something if you will stay your hand." In the case of a compromise the offer is "I do not admit your claim" (or "defense" as the case may be), "but I will do or promise something if you will abandon it." But it has been argued that if the claim or defense is of an unsubstantial character the consideration fails. The answer is to be fotmd in the judgment of Cockburn, C.J., in CaUisher V. Bischoffshdm. "Every day a compromise is effected on the ground that the party making it has a chance of succeeding in it, and if he bona fide believes that he has a fair chance of succeeding he has a reasonable ground for suing, and his forbearance to sue will constitute a good consideration. When such a person forbears to sue, he gives up what he believes to be a right of action and the other party gets an advantage, and instead of being annoyed with an action he escapes the vexations incident to it. It would be another matter if a person made a claim which he knew to be imfounded and, by a compromise, derived an advantage under it: in that case his conduct would be fraudulent." " ' a CaUisher v. Bischoffsheim, (1870) L.R. 5 Q.B. 449. ^ The consideration was sufficient in this case, if the plaintiff's averment shows that he forbore to take any action that he was privileged to take. It is wholly immaterial whether or not there was a fund available. Forbear- ance to sue an insolvent with no assets would be sufficient consideration. So too would be the forbearance to take steps to have an administrator appointed. However, the plaintifi alleged merely that he had "forborne and given day of payment." The coiu-t may be justified in sustaining a demurrer to this, because it does not make sufficiently clear that there was some possible action that the plaintiff was privileged to take and from which he forbore. 2 RusseU V. Cook, (1842, N.Y.) 3 Hill, 504. ' In compromise courts are generally satisfied if the promisee honestly 132 THE FORMATION OF CONTRACT [Chap. IV If therefore it is clear that one of the parties to the com- promise has no case, and knows that he has none, the agree- ment to compromise would not be held binding." ^ 133. Gratuitous bailment. A different kind of difficulty has arisen in cases of the gratuitous bailment or deposit of chattels, and in cases of gratuitous employment. Here the law imposes a Hability, independent of contract, upon the depositary or the person employed. The relations of the parties therefore origi- nate sometimes in contract, sometimes in the voluntary act of the party liable, and the cases need to be carefully studied in order to ascertain the precise legal relation with which the courts are dealing. A chattel may be bailed, or placed in the charge of a bailee or depositary, for various purposes — for mere custody, for loan, for hire, for pledge, for carriage, or in some other way to be dealt with or worked upon. In every case the relations of the a Wade «. Simeon, (1846) 2 C.B. 548. believes in his claim. Grandin v. Grandin, (1887) 49 N.J. L. 508; Bowers &c. Co. v. Hess, (1904) 71 N.J. L. 327; Wahl v. Bamum, (1889) 116 N.Y. 87; Zoebisch v. Von Minden, (1890) 120 N.Y. 406; BeUows v. Sowles, (1884) 57 Vt. 164. Cmtra: U.S. Mortgage Co. v. Henderson, (1886) 111 Ind. 24; Peterson v. Breitag, (1893) 88 Iowa, 418. "It is the settled law of this state that if a debt or claim be disputed or contingent at the time of payment the payment when accepted of a part of the whole debt is a good satisfaction, and it matters not that there was no solid foundation for the dispute. The test in such cases is, was the dispute honest or fraudulent? If honest it affords the basis for an accord between the parties, which the law favors, the execution of which is the satisfaction." Post V. Thomas, (1914) 212 N.Y. 264, 273, citing Simons v. Amer. Leg. of Honor, (1904) 178 N.Y. 263. In Silver v. Graves, (1911) 210 Mass. 26, it is said: "The intention must be sincere to carry on a Utigation which is believed to be well grounded and not false, frivolous, vexatious or unlawful in its nature. The abandonment of an honest purpose to carry on a litigation, even though its character be not such, either in law or fact or both, as ultimately to commend itself to the judgment of the tribunal which finally passes upon the question, is a surrender of something of value, and is a sufficient consideration for a con- tract. But the giving up of litigation, which is not founded in good faith, and which does violence to an enlightened sense of justice in view of the knowledge of the one making the concession, is not the relinquishment of a thing of value, and does not constitute a sufficient consideration for a con- tract." To same effect Mackin v. Dwyer, (1910) 205 Mass. 472; Blount ». Wheeler, (1908) 199 Mass. 330; Prout v. Pittsfield Fire Dist., (1891) 154 Mass. 450. ' Nor would forbearance to sue or dismissal of suit be a sufficient con- sideration. Smith V. Monteith, (1844) 13 M. & W. 427 (s&mhle). Forbear- ance in the case of a claim, the validity of which depends wholly upon a doubtful principle of law, has been thou^t siifficient. Longridge v. Dorville, (1821) 5 B. & Aid. 117. Chap. IV] CONSIDERATION 133 parties originate in contract: but in every case a duty to use reasonable care is imposed by law on the bailee, and failure to use such care constitutes a wrong independently of contract. The bailor has always a remedy for failiure to use care; he can bring an action ex delicto, for negligence. If his matter of complaint extends beyond this he must rely upon the terms of the contract," and if the bailment itself is gratuitous, and an action is brought ex contractu, we must seek for the consideration which supports the contract. It has been laid down constantly, and may be taken as settled law, that the fact of parting with the possession of property is a detriment to the bailor which fur- nishes consideration for a promise by the bailee to take reason- able care of the property, or to do certain services in respect of it.i Thus A allowed two bills of exchange to remain in the hands of X, and X thereon promised that if he could get the bills discounted he would do so and pay the proceeds to the account of A. This promise was held to be made on good consideration, namely the permission given to X to retain the custody of the bills.* 2 It will be noted that the bailee here undertook something more than mere custody, that the action was ex contractu, and that therefore consideration was required to be shown. In the case of bailment of a chattel the owner parts with possession, but no such consideration is to be found in cases of gratuitous employment. 134. Gratuitous service. A offers to do Z a service without reward: the offer is accepted: no action would Ue if the service were not performed, because there is no consideration for the promise of A: and yet there is abimdant authority for saying that if the service is entered upon, and performed so negligently that X thereby suffers loss or injury, there is a liability which the courts wotild recognize. A promised X to build him a warehouse by a certain day. X sued A for non-completion of the warehouse within the promised time, and also for having increased the cost of the a Turner v. StaUibrasa, [18981 1 Q.B. 60. 6 Hart n. Miles, (1858) 4 C.B. (N.S.) 571. > Robinson v. ThreadgiU, (1851, N.C.) 13 Ired. 39; Clark v. Gaylord, (1856) 24 Conn. 484. But the theory of contract m gratuitous bailment is largely fictitious, as for example in the case of a finder of lost goods. Smith V. Nassau &c. R., (1853) 27 N.H. 86. 2 Wilton V. Eaton, (1879) 127 Mass. 174; Preston v. Tooley, (1587) Cro. Eliz. 74. 134 THE FORMATION OF CONTRACT [Chap. IV building by having used new materials instead of old materials, which he was ordered to use as far as they would go. The promise of A was gratuitous, and the court held that, on this account, he was not liable on his promise to complete within a given time; but that, having entered on the work and by disobedience to orders increased its cost, he was liable for a misfeasance." Again, Coverdale undertook, gratuitously, to effect an in- surance of Wilkinson's house. This he did, but owing to his neglect of some formaUties Wilkinson could recover nothing on the policy when the house was burned down. Coverdale was held liable in damages to Wilkinson; ^ but if he had refused to carry out his promise he would have incurred no liabihty.'' ^ 135. Grounds of Uability for gratuitous undertakings. It may be said that this action was on the case for negUgehce; " but the liability was stated to arise on the promise, and was dis- puted on the ground that there was no consideration for the promise. It was therefore based on contract, and there could be no question here as in Turner v. StaMibrass, of a common law liability superimposed on an acknowledged contract of bailment. It seems a mistake to discuss the liabilities of to-day on the basis of a system of pleading which only provided circuitous and artificial remedies for breach of contract. Either we must dis- miss the conception of agreement from these cases and place them on the broad ground adopted by Willes, J., in SkeUon v. L. & N.W. Railway Co.,^ "If a person undertakes to perform a voluntary act he is liable if he performs it improperly, but not if he neglects to perform it"; or else we must follow the analogy of the contract mandaktm. In that contract no liability was created until the service asked for was entered upon; thenceforward the one party was bound to use reasonable care in performance, the other was bound to indemnify against loss incurred in doing the service. Such liabilities, reasonable enough in themselves, are difficult to reconcile with a logical use of the a Elsee i. Gatward, (1793) 5 T.R. 143. b Wilkinson v. Coverdale, (1793) 1 Esp. 75. c See Holdsworth, History 0/ English Law, vol. iii, 330. d (1867) L.E. 2 C.P; 636. 1 Baxter & Co. v. Jones, (1903) 6 Ont. L.R. 360 (agent liable for misfeas- ance). ' Thome v. Deas, (1809, N.Y.) 4 Johns. 84; McCauley v. Davidson, (1865) 10 Minn. 418; Melbourne &c. R. v. Louisville &c. R., (1889) 88 Ala. 443; Preston v. Prather, (1891) 137 U.S. 604; Isham 0. Post, (1894) 141 N.Y. 100; Swentzel v. Penn Bank, (1892) 147 Pa. 140. Chap. IV] CONSIDERATION 135 English doctrine of consideration; and they may well be excep- tions to its universal application in contract. ^ (c) Third test of sufficiency of consideraMon 136. Does the promisee do, forbear, suffer or promise more than that to which he is legally bound? If the promisor gets nothing in retxim for his promise but that to which he is already legally entitled, the consideration is not sufficient.'' 137. Performance of public duty. This may occur where the promisee is imder a public duty to do that which he promises to do. Where a witness has received a subpoena to appear at a trial, a promise to pay him anything beyond his expenses is based on no consideration; for the witness is bound to appear and give evidence." ' But wh6re a police-constable who sued for a reward offered for the supply of information, leading to a conviction, had rendered services outside the scope of his ordinary duties, he was held entitled to recover.* * On the same principle a promise not to do what a man legally cannot do is an unreal consideration. The case of Wade v. Simeon," cited in discussing forbearance as a consideration, is a sufficient illustration of this point. 138. Promise to perform existing contract. Again, we find insufficiency of consideration where the promisee undertakes to fulfill the conditions of an existing contract.^ a Collins V. Godefroy, (1831) 1 B. & A. 950. b England v. Davidson, (1840) 11 A. & E. 866. c (1846) 2 C.B. 548. ' See Beale, "Gratuitous Undertakings," 5 Harvard Law Review, 222. ' Tolhurst V. Powers, (1892) 133 N.Y. 460; Smith v. Whildin, (1848) 10 Pa. 39; Hogan v. Stophlet, (1899) 179 lU. 150; Foley v. Piatt, (1895) 105 Mich. 635. " Dodge V. Stiles, (1857) 26 Conn. 463. But a promise to pay an expert a large sum for investigating and then testifying is enforceable. Barrus v. Phaneuf, (1896) 166 Mass. 123; 32 L.R.A. 619. * Bronnenberg 0. Cobum, (1886) 110 Ind. 169; Studley v. Ballard, (1897) 169 Mass. 295; McCandless v. Alleghany &c. Co., (1893) 152 Pa. 139. ' Where A and B have an enforceable contract which A refuses to per- form, and B promises A an additional sum to perform it, or to promise to perform it, the decisions may be classified as follows: (1) It is generally held that B's promise is without consideration in that A is simply doing or promising to do what he is already legally bound to do. Lingenfelder v. Wainwright Brewing Co., (1890) 103 Mo. 578; Main Street Co. v. Los Angeles Co., (1900) 129 Cal. 301; Goldsborough v. Gable, (1892) 140 111. 269; McCarty 0. Hampton Building Ass'n, (1883) 61 Iowa, 287; Runkle v. Kettering, (1905) 127 Iowa, 6; Esterly Co.w . Pringle, (1894) 41 Neb. 265; Vanderbilt v. Sohreyer, (1883) 91 N.Y. 392 (but see N.Y. cases below); 136 THE FORMATION OF CONTRACT [Chap. IV In the course of a voyage from London to the Baltic and back two seamen deserted, and the captain, being unable to supply their place, promised the rest of the crew that if they would work the vessel home the wages of the two deserters should be divided amongst them. The promise was held not to be binding. "The agreement is void for want of consideration. There was no consideration for the ulterior pay promised to the mariners who remained with the ship. Before they sailed from London they had undertaken to do all they could under all the emergencies of the voyage. . . . The desertion of a part of the crew is to be considered an emergency of the voyage as much as their death; and those who remain are bound by the terms of their original contract to bring the ship in safety to her destined port." " ^ a Stilk V. Myriok, (1809) 2 Camp. 317. Carpenter v. Taylor, (1900) 164 N.Y. 171, 177; Jughardt v. Reynolds, (1902) 68 N.Y. App. Div. 171; Erb v. Brown, (1871) 69 Pa. 216; Gaar v. Green, (1896) 6 N.Dak. 48; Alaska &c. Ass'n v. Domenico, (1902) 117 Fed. 99. (2) Some cases hold that the forming of the new contract is evidence that the parties mutually agree to rescind the old one and extinguish the right of action for its breach, and the new contract therefore stands as if no previous one had been made. In most of these cases there was in fact no such antecedent agreement to rescind. Coyner v. Lynde, (1858) 10 Ind. 282 [but see Reynolds e. Nugent, (1865) 25 Ind. 328]; Connelly v. Devoe, (1871) 37 Conn. 570; Munroe v. Perkins, (1830, Mass.) 9 Pick. 298 [cf. Parrot v. Mexican C.R. Co., (1911) 211 Mass. 184, 194]; Rogers v. Rogers, (1885) 139 Mass. 440; Lattimore v. Harsen, (1817, N.Y.) 14 Johns. 330; Stewart v. Keteltas, (1867) 36 N.Y. 388 (but see N.Y. cases cited above); Moore v. Detroit Locomotive Works, (1866) 14 Mich. 266; Goebel v. Linn, (1882) 47 Mich. 489 [but see Widiman v. Brown, (1890) 83 Mich. 241]; Lawrence v. Davey, (1856) 28 Vt. 264. Some courts admit this doctrine only in case there is some unforeseen difficulty or hardship in the first contract. Linz v. Schuck, (1907) 106 Md. 220; King v. Duluth &e. Ry., (1895) 61 Minn. 482; Osborne v. O'Reilly, (1887) 42 N.J. Eq. 467. (3) At least one case has treated the new contract as an attempt to mitigate the damages from the breach of the first, and apparently regarded both contracts as enforceable, much as if the new contract had been made with another party. Endriss v. Belle Isle Co,, (1882) 49 Mich. 279. If a debt is due and the creditor agrees to extend the time for pajTnent on consideration that the debtor will not pay until that time has elapsed and will pay interest at the same rate the debt already bears, some courts hold that the promise to extend the time rests upon a sufficient considera- tion. Fowler v. Brooks, (1842) 13 N.H. 240; Chute v. Pattee, (1854) 37 Me. 102; Fawcett v. Freshwater, (1877) 31 Ohio St. 637; Simpson v. Evans, (1890) 44 Minn. 419. Contra: Ohnstead v. Latimer, (1899) 158 N.Y. 313; Wilson V. Powers, (1881) 130 Mass. 127; Dare i>. HaU, (1880) 70 Ind. 545. 1 Accord : Bartlett v. Wyman, (1817, N.Y.) 14 Johns. 260 (crew by threats of desertion compelled master to promise higher wages). But see contra, Lattimore v. Harsen, (1817, N.Y.) 14 Johns. 330 (one under bond with penalty to open roadway promised additional compensation not to abandon existing contract). Chap. IV] CONSIDERATION 137 But the decision would have been otherwise if uncontem- plated risks had arisen." i There is in the contract into which a seaman usually enters, an implied condition that the ship should be seaworthy. So where a seaman had signed articles of agreement to help navigate a vessel home from the Falk- land Isles, and the vessel proved to be unseaworthy, a prom- ise of extra reward to induce him to abide by his agreement was held to be binding.* ^ 139. Performance of existing contract. The actual perform- ance of that which a man is legally bound to do, stands on the same footing as his promise to do that which he is legally com- pellable to do.' This rule seems a logical deduction from the doctrine of consideration, but some applications of it have met with severe criticism. 140. Same. The payment of a Smaller sum in satisfaction of a larger is not a good discharge of a debt." * Such payment is a Hartley v. Ponsonby, (1857) 7 E. & B. 872. b Turner v. Owen, (1862) 3 F. & F. 176. c It is strange that this rule should still be spoken of as the rule in Cumber v. Wane, (1721) 1 Sm. L.C. 325, (11th ed.). In that case it was held that a promissory note for £5 was no satisfaction for a debt of £15. not because there was no consideration (for a negotiable in- strument was given for a debt) but because the satisfaction was inadequate. Such a decision would hardly be supported now. > See King v. Duluth &c. Ry., (1895) 61 Minn. 482. * If under a contract one has an alternative or option and gives this up for a new promise, there is a suflBcient consideration. Thomson v. Way, (1899) 172 Mass. 423. ' Parmelee v. Thompson, (1871) 45 N.Y. 58 (payment of costs of a suit on a note is no consideration for promise to extend the time for pajonent of the note); Warren v. Hodge, (1876) 121 Mass. 106 (payment of part of a debt is no consideration for promise to extend the time for the payment of the balance); Robinson v. Jewett, (1889) 116 N.Y. 40; Dow v. Syracuse &c. R., (1903) 81 N.Y. App. Div. 862; Eastman v. Miller, (1901) 113 Iowa, 404. * This rule was finally established for England (rather regretfully it would seem) by the decision of the House of Lords in Foakes v. Beer, (1884) 9 App. Cas. 605. It was apparently unknown to that court that in a case on all fours with Foakes v. Beer, Reynold ». Purchowe, (1595) Moore, K.B. 412; s.c. Cro. Eliz. 429; 1 Rolle Ab. 28, it had been held that a part payment of an existing debt was a sufficient consideration for a promise not to levy execution for the balance. Although it was not a discharge of the debt (Pinnel's Case, 5 Co. Rep. 117a), it was a sufficient consideration for a promise. That this opinion was held by the great Sir Edward Coke, C.J., was also unknown to the House of Lords. See Bagge v. Slade, (1616) 3 Bulst. 162. The prevailing rule in the United States is the same as that in England, Bender v. Been, (1889) 78 Iowa, 283; Hoidale v. Wood, (1904) 93 Minn. 190. See 1 Cyc. 319, note 94. The most recent cases are collected in L.R.A. 1917 A, 716, 719. It is changed by statute in some states. 1 Cyc. 322. And by judicial decision in two states. Clayton v. Clark, (1896) 74 Miss. 499; Frye V. Hubbell, (1907) 74 N.H. 358. And in one or more where a written receipt 138 THE FORMATION OF CONTRACT [Chap. IV no more than a man is already bound to do, and is no considera- tion for a promise, express or implied, to forego the residue of the debt. The thing done or given must be somehow different to that which the recipient is entitled to demand, in order to support his promise. The fact that the difference is slight will not destroy its eflScacy in constituting a consideration, for if the courts inquired whether the thing done in return for a prom- ise was sufficiently unhke that to which the promisor was already boimd, they would inquire into the adequacy of the consideration. Thus, the giving a negotiable instrument (such as a cheque) for a money debt, or "the gift of a horse, a hawk or a robe, in satisfaction, is good. For it shall be intended that a horse, a hawk or a robe might be more beneficial to the plain- tiff than money, in respect of some circumstance, or otherwise the plaintiff would not have accepted it in satisfaction." " i It would hardly seem open to doubt that a promise, not under seal, to forego legal rights, must needs depend for its validity upon the rules conunon to all promises. But the general rule is subject to some variations of detail in cases where the promise is made before the contract is broken and when it is made after. ' Contract executory. If a contract is wholly executory, and the legal duties of the parties are as yet imfulfilled, it can be dis- charged by mutual consent, the acquittance of each from the other's claims being the consideration for the promise of each to waive his own.* Contact executed. A contract in which A, one of the parties, has done his part, and X, the other, remains Uable, cannot (save in the exceptional cases of bills of exchange or promissory notes) be discharged by mere consent, but it may be discharged o Pinners case, (1602) 5 Co. Rep. 117. in full is given. 1 Cyc. 322; Dreyfus v. Roberts, (1905) 75 Ark. 354; Johnson V. Cooke, (1912) 85 Conn. 679 (semble); note in 27 L.R.A. (N.S.) 439; 20 L.R.A. 787. Payment of a smaller sum by a third party is sufficient. Clark V. Abbott, (1893) 53 Minn. 88; note in 23 L.R.A. 120. For further cases and statutes, see Williston, 27 Harvard Law Review, 513, note 24. ' Jaffray v. Davis, (1891) 124 N.Y. 164. But giving a promissory note for part of a debt was held insufficient to support a promise to release the balance in Shanley v. Koehler, (1903) 80 N.Y. App. Div. 566, aff'd 178 N.Y. 556. See also Arend v. Smith, (1897) 151 N.Y. 502. A payment of 30 cents on the dollar and forbearance to go into voluntary banlsruptcy was held sufficient in Meb-oy ». Kemmerer, (1907) 218 Pa. 381, 11 L.R.A. (N.S.) 1018 and note. = Cutter V. Cochrane, (1874) 116 Mass. 408. See § 412, post. Chap. IV] CONSIDERATION 139 by the substitution of a new agreement." A has supplied X with goods according to a contract. X owes A the price of the goods. If A waives his claim for the money, where is the con- sideration for his promise to waive it? If A and X substitute a new agreement, to the effect that X on paying half the price shall be exonerated from paying the remainder, where is the consideration for A's promise to forego the payment of half the siun due to him? The new agreement needs consideration: there must be some benefit to A or detriment to X in retiu-n for A's promise. Detriment to X there can be none in paying half of a siun the whole of which he may at any time be com- pelled to pay; and benefit to A there can be none in receiving a portion of a smn the payment of which he can at any time com- pel. * Unless A receives something different in kind, a chattel, or a negotiable instrument, or a fixed for an uncertain sum, his promise is gratuitous and must be made under seal.'' ^ Contract broken. We now come to cases where the contract is broken and a promise made to forego the right arising from the breach. Where the right itself is in dispute the suit may be com- promised as already described.* Where the right is undisputed, the amount due may be un- certain or certain. If it is uncertain, the payment of a liquidated or certain sum would be consideration for foregoing a claim for a larger though uncertain amount." * If it is certain, the promise to forego the claim or any portion a Foster v. Dawber, (1851) 6 Ex. 839. See §§ 411-17, post. b Goddard v. O'Brien, (1882) 9 Q.B.D. 37. c Wilkinson v. Byere, (1834) 1 A. &. E. 106. ' This is hardly true, as a matter of fact, as Lord Blackburn admitted in Foakes v. Beer, (1884) 9 App. Cas. 605. The part payment is in fact both a detriment to the debtor, in that he parts with money that he might law- fully have used otherwise, and a benefit to the creditor, in that he receives money. If the courts refuse to recognize this as consideration, as they gen- erally do, it must be on some principle of general pubUc policy. 2 CoUyer v. Moulton, (1868) 9 R.I. 90. ' Russell V. Cook, (1842, N.Y.) 3 Hill, 504; Wahl v. Bamum, (1889) 116 N.Y. 87. ♦ Nassoiy ». Tomlinson, (1896) 148 N.Y. 326; Fuller v. Kemp, (1893) 138 N.Y. 231, B.C. 20 L.R.A. 785, where in a note will be found a large collection of cases on pajmient of a smaller sum in discharge of a larger. The payment of a sum admittedly due, is no consideration for a promise to accept it as a full satisfaction of another claim for a disputed amount. Mance v. Hossington, (1912) 205 N.Y. 33; Demeules v. Jewel Tea Co., (1908) 103 Minn. 150, 14 L.R.A. (N.S.) 954. Cf. Tanner v. Merrill, (1896) 108 Mich. 58; FuUer v. Smith, (1910) 107 Me. 161. 14fl THE FORMATION OF CONTRACT [Chap. IV of it can only be supported by the giving of something different in kind, or by a payment at an earlier date or in diEferent manner to that agreed on.' And it is important to notice that whether the smn due is of certain or uncertain amoimt the consideration for the promise to forego must be executed. The parties must not only have agreed, but their agreement must be carried out if it is to be an answer to the original cause of action. Where it has been carried out it is an accord and satisfaction, where it has not been carried out it is an accord executory. As is said in an old case, "accord executed is satisfaction: accord executory is only substituting one cause of ac- tion in the room of another, which might go on to any extent." " ^ Some denunciation and some ridicule have been expended on the rule that the payment of a smaller sum in satisfaction of a larger is not a good discharge of a debt.' And yet, as was said in a judgment in which the House of Lords recently affirmed the rule, "it is not really unreasonable, or practically inconven- ient, that the law should require particular solenmities to give to a gratuitous contract the forc'e of a binding obligation." * * There seems to be no difference between a promise by A to X to give him £45 on demand, and a promise by A to X to excuse him £45 out of £50 then due. If consideration is needed in the one case, it is needed in the other, and there can be no reason why the law should favor a man who is excused money which he ought to pay, more than a man who is promised money which he has not earned.^ a Lynn i. Bruce, (1794) 2 H. Bl. 319. h Foakes v. Beer, (1884) 9 App. Gas. 605. 1 Jaffray v. Davis, (1891) 124 N.Y. 164; Church v. Spicer, (1912) 85 Conn. 579; Kidder v. Kidder, (1859) 33 Pa. 268. Cf. Price v. McEachem, (1914) 111 Me. 573. For instances of new consideration, see 1 Cyc. 323-29. 2 See Kromer v. Heim, (1879) 75 N.Y. 574. See § 431, vost. ' See Ames, " Two Theories of Consideration," 12 Harvard Law Beinew at p. 525. In Couldery v. Bartrum, (1881) 19 Ch. D. 399, it was said by Sir George Jessel that according to EngUsh law " a creditor might accept any- thing in satisfaction of a debt except a less amount of money. He might take a horse or a canary or a tomtit if he chose and that was accord and satisfaction; but by a most extraordinary peculiarity of English law he could not take 19s. 6d. in the pound." * But the question in dispute is whether or not the promise is in fact gratuitous. ' For a case escaping the rule on the theory of gift, see Gray v. Barton, (1873) 55 N.Y. 68. There is a distinction between a discharge — which is the extinguishment of a pre-existing right; and a promise — which is the creation of a new duty. The courts seem now to be making about the same requirement for both, in respect of consideration; but there are some cases where the requirement was held not to be identical. See post, §§ 411-18. Chap. TT] CONSIDERATION 141 141. Composition with creditors. A composition with credi- tors appears at first sight to be an infraction of the rule, inas- much as each creditor undertakes to accept a less sum than ia due to him in satisfaction of a greater. But the promise to pay, or the payment of a portion of the debt, is not the consideration upon which the creditor renounces the residue. That this is so ia apparent from the case of Fitch v. Sutton." There the defendant, a debtor, compounded with his creditors and paid them 7s. in the pound; he promised the plaintiff, who was one of the credi- tors, that he would pay him the residue when he could; but the plaintiff nevertheless gave him a receipt of all claims which he might have against him "from the beginning of the world to that day." The plaintiff subsequently brought an action for the residue of his claim; the defendant pleaded the acceptance of 7s. in the pound in full of all demands : but Lord Ellenborough said: "It is impossible to contend that acceptance of £17 10s. is an extin- guishment of a debt of £50. There must be some consideration for a relinquishment of the residue; something collateral, to show a possi- bility of benefit to the party relinquishing his further claim, otherwise the agreement is nudum pactum." The consideration in a composition with creditors must therefore be something other than the mere acceptance of a smaller stun in satisfaction of a larger: it is the substitution of a new agreement with new parties and a new consideration. The common law on this point (apart from the various Bankruptcy Acts) was settled in the case of Good v. Cheesman.'' There the defendant, a debtor who had compounded with his creditors, successfully set up as against an individual credi- tor suing for the whole of his debt, not a separate promise by that creditor to forego the residue, but a composition made with all the creditors. The consideration which supported each credi- tor's promise to accept a lesser smn in satisfaction of a greater was thus stated by Parke, J. : " Here each creditor entered into a new agreement with the defend- ant (the debtor), the consideration of which, to the creditor, was a forbearance by all the other creditors, who were parties, to insist upon their claims." " It is not the payment of a portion of the debt, which forms the consideration in the case of a composition with creditors, a (1804) 5 East. 230. 6 (1831) 2 B. & Ad. 328. c Good V. Cheeaman, (1831) 2 B. & Ad. 335. 142 THE FORMATION OF CONTRACT [Chap. IV but the substitution of a new agreement with different parties for a previous debt." ' The composition with creditors is therefore no exception to the general rule; creditor Xnot merely gets payment of 10s. in the povmd from his debtor A, but the benefit of a promise procured by A from creditors Y and Z that they too will be con- tent with a payment of 10s. in the pound. ^ 142. [Mutual subscriptions to a charity.]' . o Boyd ». Hind, (1857) 1 H. & N. 938. Slater s. Jones, (1873) L.R. 8 Ex. at p. 193. > Williams v. Carrington, (1857, N.Y.) 1 Hilt. 515; Perkins u. Lockwood, (1868) 100 Mass. 249; Brown ». Famham, (1892) 48 Minn. 317. ' There are several possible views of the grounds for enforcing a com- position with creditors. (1) That the consideration moves from the debtor, and consists in his procuring the promises of the other creditors. This is the view of the author. It is open to the objection that it is not always the case that the debtor procures these promises. The composition would be equally binding if the creditors first agreed among themselves and the debtor accepted their offer. (2) That the creditors mutually promise each other for the benefit of the debtor, the consideration moving from each cred- itor and consisting in the detriment he suffers in taking less than he is enti- tled to, relying on the promises of the other creditors to do the same. This view could not be pressed in jurisdictions where a stranger to the considera- tion cannot enforce' the promise. See ante, § 128. (3) That the promises are enforced on the groimd of estoppel, since it would be a fraud on the other creditors to permit one to recover more than he has agreed to take when they have taken less than they are entitled to, relying on his promise to do the same. Metcalf on Cont., p. 192. Sometimes one, and often all, of these reasons are assigned. Perkins v. Lockwood, (1868) 100 Mass. 249; Williams V. Carrington, (1857, N.Y.) 1 Hilt. 615; Murray v. Snow, (1873) 37 Iowa, 410. (4) It may be suggested further that the promise of the debtor to pay all the creditors pro rata involves at least the temporary surrender of his common-law privilege of preferring one creditor over another. See Ames, 12 Harvard Law Review, 526-28. ' Mutual subscriptions. An analogous problem arises in the case of mutual promises to subscribe money to a charitable object. Divergent views are taken of this problem. (1) If the subscription is in effect an offer to pay in case the promisee will do certain things, as procure additional subscrip- tions up to a fixed amount [Roberts v. Cobb, (1886) 103 N.Y. 600], or pro- cure subscriptions and an effective charter for a college [Eeuka College v. Ray, (1901) 167 N.Y. 96], the doing of the act is a sufficient consideration to support the promise. Sherwin v. Fletcher, (1897) 168 Mass. 413. The request need not be expressed; it may be implied. Keuka College v. Ray, supra. Hence in many cases the subscription is enforced if the promisee has entered upon the work or incurred habihties on the faith of the subscrip- tions. Beatty v. Western College, (1898) 177 HI. 280; First M. E. Church «. Donnell, (1899) 110 Iowa, 5; Albert Lea College v. Brown, (1903) 88 Minn. 524; Hodges v. Nalty, (1899) 104 Wis. 464; Irwin v. Lombard Univ., (1887) 56 Ohio St. 9. This sometimes becomes a kind of estoppel contract like that in Ricketts v. Scothom, (1898) 67 Neb. 51. See Beatty v. Western CoUege, supra. But if no act be done or habiUty incurred on the faith of a subscrip- tion, it may be revoked, and it is revoked by the death of the subscriber. Chap. IV] CONSIDERATION 143 143. Promise to perform contract with third party. It is not difficult to see that consideration is insufficient if it consist in a promise given to perform a public duty, to perform a contract already made with the promisor, or to discharge an existing liability. It is harder to answer the question whether the per- formance or promise to perform an existing contract with a third party is a legally operative consideration. 1 We must note two cases deahng with this form of considera- tion. In Shadwdl v. Shadwell " the plaintiff had promised to marry X: his uncle promised him in writing that if he married X he should receive £150 a year during the imcle's lifetime. He married X; the annuity fell into arrear; the uncle died, and the plaintiff sued his executors. The court differed as to the existence of a consideration for the uncle's promise. Erie, C.J., and Keating, J., inclined to regard it as the offer of a prom- ise capable of becoming a binding contract when the marriage took place. Byles, J., dissented, holding that the plaintiff had done no more than he was legally bound to do, and that his o (1860) 9 C.B. (N.S.) 159. Pratt V. Trustees, (1879) 93 HI. 475; Presbyterian Church v. Cooper, (1889) 112 N.Y. 517; Cottage St. Church v. KendaU, (1877) 121 Mass. 528. (2) It is held in some jurisdictions that the acceptance of the subscription by the trustees of the charity imphes a promise on their part to execute the work contemplated, and this supports the subscriptions. Trustees v. Haskell, (1882) 73 Me. 140; CoUier v. Baptist Ed. Soc, (1848, Ky.) 8 B. Mon. 68; Helfenstein's Estate, (1875) 77 Pa. 328; Superior Land Co. v. Bickford, (1896) 93 Wis. 220; Martin v. Meles, (1901) 179 Mass. 114. (3) A few jurisdictions hold that the promises of the subscribers mutually support each other. This view implies that a stranger to the consideration may enforce the promise. Higert v. Indiana Asbury Univ., (1876) 63 Ind. 326; Christian College v. Hendley, (1875) 49 Cal. 347; Edinboro Acad. v. Robin- son, (1860) 37 Pa. 210; Lathrop v. Knapp, (1870) 27 Wis. 214; Irwin v. Lombard University, (1887) 56 Ohio St. 9 (semble); Allen v. Duffie, (1880) 43 Mich. 1. It is pointed out in Martin v. Meles, (1901) 179 Mass. 114, that while the theory of mutual-promise consideration is generally rejected in these cases, it still prevails in the case of composition of creditors. Mutual subscriptions for a business purpose, as contrasted with a char- itable purpose, may be distinguished; in such cases there is usually some valuable consideration moving to the subscriber. Martin v. Meles, (1901) 179 Mass. 114; Davis v. Campbell, (1896) 93 Iowa, 524. So also in case of mutual promises among dealers as to the conduct of their business. StovaU V. McCutchen, (1900) 107 Ky. 677. But see New Orleans &c. Ass'n v. Magnier, (1861) 16 La. Ann. 338. 1 See Williston, 8 Harvard Law Review, 32-38; 27 ibid. 503; Ames, 12 ibid. 519-521; Beale, 17ibid.71; Corbin, "Does a Pre-existing Duty Defeat Consideration," (1918) 27 Yale Law Journal, 362. 144 THE FORMATION OF CONTRACT [Chap. IV marriage was therefore no consideration for the uncle's prom- ise, 01 In Scotson v. Pegg,^ Scotson promised to deliver " to Pegg a cargo of coal then on board a ship belonging to Scotson, and Pegg promised in return to unload it at a certain rate of speed. This he failed to do, and when sued for breach of his promise, pleaded that Scotson was imder contract to dehver the coals to X or to X's order, and that X had made an order in favor of Pegg. Scotson therefore in promising to dehver the coals promised no more than he was bound to perform under his contract with X, and Pegg alleged that there was no considera- tion for his promise to imload speedily. The court held that Pegg was liable, since it was not in- consistent with the pleading that there might have been some dispute as to Pegg's right to the coals, or some claim upon them foregone by Scotson: but Wilde, B., said, "If a person chooses to promise to pay a sum of money in order to induce another to perform that which he has already contracted with a third person to do, I confess I cannot see why such a promise should not be binding." ' In both these cases we can reconcile the decisions with the doctrine of consideration, but not the reasons given for the decisions. In Shadwell v. Shadwell the original contract was executory; the nephew and M, to whom he was engaged, might have put an end to it by a mutual waiver of their respective promises. The nephew, at the request of his uncle, abandoned, or agreed a In other caaes where there is a pronuee to pay money in consideration of a marriage taking place, the promise is a part of the engagement to marry, as in Synge v. Synge, [1894] 1 Q.B. 466, or an inducement to the engagement, as in Hammersley v, de Biel, (1845) 12 CI. &F. 62, or is made in consideration of an immediate fulfillment of the promise, as in Skeete V. Silberbeer, (1895) 11 T.L.E. 491. 6 (1861) 6 H. & N. 295. ' For a case almost exactly parallel to Shadwell v. Shadwell in its facts, and decided the same way, see DeCicco v. Schweizer, (1917, N.Y.) 117 N.E. 807, discussed at length in 27 Yak Law Journal, 362. 2 The declaration seems to have alleged delivery, and not a promise to deliver, as the consideration. » This case is followed in Abbott v. Doane, (1895) 163 Mass. 433, where the contract appears to have been bilateral. In Manetti v. Doege, (1900) 48 N.Y. App. Div. 567, the promise is held enforceable if the promisor re- ceives a benefit from performance; but this is perhaps contrary to Arend v. Smith, (1897) 151 N.Y. 502. These cases also tend to support the doctrine; Merrick v. Giddings, (1882, D.C.) 1 Mackey, 394; Champlain Co. v. O'Brien, (1902) 117 Fed. 271; DonneUy v. Newbold, (1901) 94 Md. 220; Day v. Gardner, (1886) 42 N.J. Eq. 199; Humes v. Land Co., (1893) 98 Ala. 461, 473^ distinguishing Johnson v. Sellers, (1858) 33 Ala. 265. Chap. IV] CONSIDERATION 145 to abandon, a power which he might have exercised in concur- rence with M; and the abandonment of a power has always been held to be consideration for a promise. ^ In Scotson v. Pegg the court clearly thought that the prom- ise to deliver coals to the defendant might have been some- thing more than a mere performance of an existing promise to a third party; that there might have been a right waived or claim foregone which did not appear on the pleadings.'' So far the decisions are consistent with principle, but there are dicta which seem to show that two judges in the first case, and Baron Wilde in the second, thought that a promise given in consideration of the performance or promise to perform a contract with a third party was binding. Whether the promise is conditional on the performance of the contract made with the third party, or whether it is given in return for a promise to perform, does not seem to make any difference in principle. If we say that the consideration is the detriment to the promisee in exposing himself to two suits instead of one for the breach of contract we beg the question, for we assmne that an action would he on such a promise.* If we say that the consideration is the fulfillment of the promisor's ' If there was a valid bilateral engagement between the nephew and EUen Nichol, the only rights jxjssessed by the former were a right against Ellen that ske should marry him as agreed and an indefinite number of rights against third persons that they should not interfere with Ellen's perform- ance as agreed. The nephew abandoned none of these rights. In addition to these rights, he had also the privilege of making an offer of rescission to Ellen and the legal pmuer of creating in EUen the power of rescission by making such an offer. Prior to his actual marriage to Ellen, he abandoned neither the privilege nor the power, although he forbore from acting iu accord- ance with them. By the actual marriage, however, he utterly destroyed this legal power, for an offer of rescission subsequently made would be void of legal effect. The nephew also had the legal power of breaking his contract with Ellen, thereby substituting a secondary obligation for the primary one. The forbearance to act in accordance with this power is also a detri- ment and would be a sufficient consideration in itself, except for the fact that he was not, as to EUen, legaUy privUeged to break the contract. For a further discussion, see Arthur L. Corbin, "Does a Pre-existing Duty Defeat Consideration?" (1918) 27 Yale Law Journal, 362. ' Of course, no promise ought to be enforced merely because there might have been a consideration that is not aUeged and proved. ' It does, indeed, beg the question to say that a promise is a detriment because it creates a new legal duty, and then to say that there is a new legal duty because a promise is a detriment. This is true in the case of aU bilateral contracts. See Williston, 8 Harvard Law Review, 29. BUateral contracts are enforceable because social custom and court decisions have long so de- creed. The " detriment" theory of consideration should not be applied to them. See ante, § 124, and note. 146 THE FORMATION OF CONTRACT [Chap. IV desire to see the contract carried out, we seem to confound motive and consideration. At least, one may say that on principle the performance or promise to perform an outstanding contract with a third party is not of itself consideration for a promise," and that the prac- tical result of the cases is not inconsistent with this rule.' a The great preponderance of Judicial decision in America is in favor of this view. See note infra. For a summary of the opinions of Jurists on the subject, see Law Quarterly Retnew, vol. xx, p. 9, and the Harvard Law Review^ vol. vii, p. 71- ' The weight of American authority is in favor of the view that the per- formance or promise to perform an existing contract with A, is not a good consideration for a promise by B. Johnson's Adm'r v. Seller's Adm'r, (1858) 33 Ala. 265; Arend v. Smith, (1897) 151 N.Y. 502; Robinson v. Jewett, (1889) 116 N.Y. 40; Havana &c. Co. v. Ashurst, (1894) 148 111. 115; Reynolds v. Nugent, (1865) 25 Ind. 328; Schuler v. Myton, (1892) 48 Kans. 282; Put- nam V. Woodbury, (1878) 68 Me. 58; Sherwin v. Brigham, (1883) 39 Ohio St. 137; Gordon v. Gordon, (1875) 56 N.H. 170; Wimer v. Overseers, (1883) 104 Pa. 317; Davenport v. First Cong. Soc, (1873) 33 Wis. 387; Hanks v. Barron, (1895) 95 Tenn. 275. It appears to the present editor that both performance and a promise to perform ought to be held to be sufficient consideration. Such performance is an actual detriment, because it might be much more beneficial to break the contract with the third party and to risk payment of damages. But if this is a detriment that should not be recognized by the law on grounds of policy, still the performer was privileged to go to his other obUgee and induce him to rescind the contract by mutual agreement. By performance, he forbears to exercise his privilege and destroys the power of offering a mutual rescission. Thus, the promisor gets the benefit of the performance, which was that for which he gave his promise; and the promisee; has in- curred some legal detriment in return for the promise and within the con- templation of the parties. It is immaterial that this detriment is not equivalent in amount with the benefit derived by the promisor. The New York Court of Appeals has adopted this view in the case of DeCicco v. Schweizer, (1917) 117 N.E. 807, where the facts were almost exactly like those in Shadwell v. Shadwell, supra. In McDevitt v. Stokes, (1917) 192 S.W. 681, the Kentucky Court of Appeals adhered to the generally prevail- ing rule. Where the contract is bilateral, it should be enforced for the same reasons that any other bilateral contract is enforced. Neither logic nor public policy invaUdates those reasons where the consideration is a promise to perform in accordance with a pre-existing contract with a third person. Such a bilateral contract brings the contractor under two separate duties to the several promisees, none the less separate because one performance will dis- charge them both. A mutual rescission in the case of one would have no effect whatever upon the other. If A has contracted with £ to do a thing, and A then promises C to do that same thing in return for an executed consideration on C's part, C can maintain an action on A's promise to him. This is a unilateral contract. It makes no difference whether A's promise is consideration for what C did. What C did is none the less consideration for A's promise. For a detailed discussion of this problem, see Arthur L. Corbin, "Does a Pre-existing Duty Defeat Consideration?" (1918) 27 Yale Law Jourrud, 362. Chap. IV] CONSIDERATION 147 3. Consideraiion rmist be legal 144. LegaKty of consideration. This rule should be men- tioned here, but we must deal with it later when the time comes to consider, as an element in the formation of contract, the legality of the objects which the parties have in view when they enter into a contract. i. Consideration may be executory or executed, it must not be past 145. Definitions. We now come to deal with the relation of the consideration to the promise in respect of time. The con- sideration may be executory, and then it is a promise given for a promise; or it may be executed, and then it is an act or for- bearance given for a promise; or it may be past, and then it is a mere sentiment of gratitude or honor prompting a return for benefits received; in other words, it is no consideration ataU.i 146. Executory consideration. As to executory considerations, nothing remains to be added to what has been said already. I have shown that a promise on one side is good considera- tion for a promise on the other.* 147. Executed consideration. A contract arises upon exe- cuted consideration when one of the two parties has, either in the act which constitutes an offer or the act which constitutes an acceptance, done all that is necessary for formation of the contract, leaving an outstanding duty on one side only. These two forms of consideration are described by Mr. Leake as "acceptance of an executed consideration," and "considera- tion executed upon request": corresponding to the offer of an act for a promise, and the offer of a promise for an act." Offer of an act for a promise.^ In the first case a man offers his labor or goods under such circiunstances that he obviously expects to be paid for them; the contract arises when the labor or goods are accepted by the person to whom they are offered, a Leake on Contracts (1st ed.), p. 23. ' It is no consideration in the sense of an agreed equivalent given for the promise; but the act of the promisee in the past is a fact that causes the promise to be given as a return therefor, and in several classes of cases, such fact is held to operate as a suflBcient reason for enforcing the promise. Though it was not given for the promise, the promise is given because of it. * See § 124, ante. ' See ante, § 23, and notes. 148 THE FORMATION OF CONTRACT [Chap. IV and he by his acceptance becomes bound to pay a reasonable price for them. 1 "If I take up wares from a tradesman without any agreement of price, the law concludes that I contracted to pay their real value." " So in Hart v. Mills the defendant had ordered foiu* dozen of wine and the plaintiff sent eight, the defendant retained thirteen bottles and sent back the rest, and the plaintiff sued him on the original contract for the pur- chase of four dozen. It was held that the retention of thirteen bottles was not an acquiescence in the misperformance of the original contract, but a new contract arising upon the accept- ance of goods tendered, and that the plaintiff could only recover for thirteen bottles. "The defendant orders two dozen of each wine and you send four: then he had a right to send back all; he sends back part. • What is it but a new contract as to the part he keeps?" ''^ It must, however, be borne in mind that where the person to whom such an offer is made has no opportunity of accept- ing or rejecting the things offered, an acceptance to which he cannot assent will not bind him. The case of Taylor v. Laird," already cited, illustrates this proposition. The difficulty which would arise, should such an enforced acceptance create a legal duty, is forcibly stated by Pollock, C.B.: "Suppose I clean your property without your knowledge, have I then a claim on you for payment? One cleans another's shoes; what can the other do but put them on? Is that evidence of a contract to pay for the cleaning?" ' Offer of a promise for an act. The "consideration executed upon request," or the contract which arises on the acceptance by act of the offer of a promise, is best illustrated by the case of an advertisement of a reward for services which becomes a promise to give the reward when the service is rendered. In such cases it is not the offeror, but the acceptor, who has done his part at the moment when he enters into the contract. If A makes a general offer of reward for information and X sup- plies the information, A's offer is turned into a promise by the a Per Tindal, C.J., in Hoadley t. MoLaine, (1834) 10 Bing. 482. b Hart v. Mills, (1846) 15 M. & W. 87. c (1856) 25 L.J. Exoh. 329. 1 Fogg V. Portsmouth Athenseum, (1862) 44 N.H. 115. ' Bowker v. Hoyt, (1836, Mass.) 18 Pick. 655. The duty here created should be classified not as contract but as quasi-contract. » Bartholomew v. Jackson, (1822, N.Y.) 20 Johns. 28. Under some cir- cumstances, however, the law should and does create a quasi-contractual duty to pay for value received. Chap. IV] CONSIDERATION 149 act of X, and X simultaneously concludes the contract and performs his part of it." ^ And this form of consideration will support an implied as well as an express promise where a man is asked to do some service which will entail risk or expense. The request for such services embodies or implies a promise, which becomes binding when liabilities or expenses are incurred. A lady employed an auc- tioneer to sell her estate; he was compelled in the course of the proceedings to pay certain duties to the Crown, and it was held that the fact of employment implied a promise to indemnify for money paid in the course of the employment. "Whether the request be direct, as where the party is expressly desired by the defendant to pay; or indirect, as where he is placed by him under a liability to pay, and does pay, makes no difference." '' ^ It is probably on this principle, the implication of a prom- ise in a request, that the case of Lamphigh v. Braithwait" is capable of explanation. If so, we do not need the theory with which I shall have to deal presently in discussing that case. 148. A past consideration will not support a promise. It remains to distinguish executed from past consideration. A past consideration is, in effect, no consideration at all; that is to say, it confers no benefit on the promisor, and involves no detriment to the promisee in respect of his promise. It is some act or forbearance in time past by which a man has benefited without thereby incurring any legal liability. If afterwards, whether from good feeling or interested motives it matters not, he makes a promise to the person by whose act or forbearance he has benefited, and that promise is made upon no other con- sideration than the past benefit, it is gratuitous and cannot be enforced; it is based upon motive and not upon consideration.' A purchased a horse from X, who afterwards, in considera- o England v. Davidson, (1840) 11 A. & E. 856. 6 Brittain v. Uoyd, (1845) 14 M. & W. 762. c (1615) 1 Sm. L.C. 141, Hob. 105. 1 Reif V. Paige, (1882) 55 Wis. 496; Cummings v. Gann, (1866) 52 Pa. 484; Wentworth v. Day, (1841, Mass.) 3 Mete. 352. The act of Z is the exer- cise of the power conferred upon him by A's offer. See ante, §§ 37a, 38. ^ It may frequently make the difference between contract and quasi- contract. However, the duty to be performed — the debt — is no doubt the same in either case. ' Dearborn v. Bowman, (1841) 3 Mete. (Mass.) 155; Mills v. Wyman, (1825) 3 Pick. (Mass.) 207; Allen v. Bryson, (1885) 67 Iowa 591; Freeman V. Robinson, (1876) 38 N.J. L. 383; Shepard v. Rhodes, (1863) 7 R.I. 470; Barker v. Thayer, (1914) 217 Mass. 13. See § 127, ante; also § 145, note. 150 THE FORMATION OF CONTRACT [Chap. IV tion of the previous sale, promised that the horse was sound and free from vice. It was in fact a vicious horse. The court held that the sale created no implied warranty or promise that the horse was not vicious; that the promise must therefore be regarded as independent of the sale, and as an express promise based upon a previous transaction. It fell therefore "within the general rule that a consideration past and executed will support no other promise than such as would be implied by law." " ' 149. Exceptions. (1) Consideration moved by previous re- quest. To the general rule thus laid down certain exceptions are said to exist; they are perhaps fewer and less important than is sometimes supposed. A past consideration will, it is sometimes said, support a sub- sequent promise, if the consideration was given at the request of the promisor. In Lampldgh v. Braithwait,^ which is regarded as the leading case upon this subject, the plaintiff sued the defendant for £120 which the defendant had promised to pay to him in consider- ation of services rendered at his request. The court here agreed that a mere voluntary courtesy will not have consideration to uphold an assumpsit. But if that courtesy were moved by a suit or request of the party that gives the assumpsii it will bind; "for the promise, though it follows, yet it is not naked, but couples itself with the suit before, and the merits of the party procured by that suit." * a Roscoria ;. Thomaa, (1S42) 3 Q.B. 234. b (1616) Eobart, 105; and see I Sm. L.C. 141. 1 Bloss V. Kittridge, (1833) 5 Vt. 28; Summers i>. Vaughan, (1871) 351nd. 323; Morehouse v. Comstock, (1877) 42 Wis. 626; Aultman v. Kennedy, (1885) 33 Minn. 339; Chamberlin v. WMtford, (1869) 102 Mass. 448. 2 Some American cases follow Lampleigh v. Braithwait where there was an express previous request. Stuht v. Sweesy, (1896) 48 Neb. 767; Pool v, Horner, (1885) 64 Md. 131; Paul v. Stackhouse, (1861) 38 Pa. 302; Sutoh's Estate, (1902) 201 Pa. 305; Silverthom v. Wylie, (1897) 96 Wis. 69; Raipe I). Gorrell, (1900) 105 Wis. 636. Some go further and infer from the subse- quent promise that there was a previous request where the consideration or benefit moved directly from the promisee to the promisor. Hicks v. Burhans, (1813, N.Y.) 10 Johns. 242; Jilson v. Gilbert, (1870) 26 Wis. 637; Hatch v. Purcell, (1850) 21 N.H. 544; Wilson v. Edmonds, (1852) 24 N.H. 517; Montgomery v. Downey, (1902) 116 Iowa, 632; Boothe v. Fitzpatrick, (1864) 36 Vt. 681 ; Seymour v. Marlboro, (1868) 40 Vt. 171 ; Landis v. Royer, (1868) 59 Pa. 95. But other cases hold that if the services were intended to be gratuitous so that no impUed promise would be raised, an express subse- quent promise is without consideration. Allen v. Bryson, (1885) 67 Iowa, 591; Chamberlin v. Whitford, (1869) 102 Mass. 448; Johnson v. Kimball (1899) 172 Mass. 398; Moore v. Elmer, (1901) 180 Mass. 15; Stonebumer v. Motley, (1898) 95 Va. 784. See 53 L.R.A. 353, note. And see § 127, ante. Chap. IV] CONSIDERATION 151 The case of Lampleigh v. Braithwait was decided in the year 1615, and for some time before and after that decision, cases are to be found which, more or less definitely, support the rule as stated above." But from the middle of the seventeenth century until the present time no direct authority can be dis- covered, except the case of Bradford v. Roidsion,'' decided in the Irish Court of Exchequer in 1858. The rule is laid down in textbooks, but in the few cases in which it is referred to by the judges the interpretation placed on it in the books is regarded as open to question. Thus in Kaye v. Button," Tindal, C.J., lays down the rule that "where the consideration is one from which a promise is by law impUed" — as for instance where acceptance of serv- ices imports a promise to pay for them — "no express promise made in respect of that consideration after it has been executed, and differing from that which is by law implied, can be en- forced." He goes on to say that where consideration given on request is not so given as to import a promise, " it appears to have been held in some instances" that an act done at the request of the party charged is sufficient consideration to render binding a subsequent promise. But on this point he expresses no opinion, nor was it necessary for the purposes of the judgment. The rule is further narrowed by Maule, J., in Elderton v. Emmens!^ He says, "An executed consideration will sustain only such a promise as the law will imply"; and this really means that the explicit promise in Lampleigh v. Braithwait would only be valid if the law would have implied it anyhow from the words or conduct of the parties. In Kennedy v. Brown," Erie, C.J., puts the case of Lampleigh V. Braithwait from a modem point of view. "It was assumed," he says, "that the journeys which the plaintiff performed at the request of the defendant and the other services he ren- dered would have been suflScient to make any promise binding if it had been connected therewith in one contract: the peculiarity of the decision lies in connecting a subsequent promise with a prior consideration after it had been executed. Probably at the present day, such service on such a request would have raised a promise by implication to pay what it was worth; and the subsequent promise of a simi certain would have been evidence for the jury to fix the amount" (p. 740). a See cases colleoted in the note to Hunt i. Bate, (1568) 3 Dyer, 272a. b (1858) 8 Ir. C.L. 468. Langdell, 450. c (1844) 7 M. & Gr. 807. d (1847) 4 C.B. at p. 496. e (1863) 13 C.B. (N.S.) 677. 152 THE FORMATION OF CONTRACT [Chap. IV This would seem to be the ratio decidendi in Wilkinson v. Oliveira,'^ where the plaintiff at the defendant's request gave him a letter for the purposes of a lawsuit. The letter proved the defendant's case, by which means he obtained a large sum of money, and he subsequently promised the plaintiff £1,000. Here the plaintiff evidently expected some return for the use of the letter, and the defendant's request for it was, in fact, an offer that if the plaintiff would give him the letter he would pay a sum to be hereafter fixed.' Regarded from this point of view the rule which we are dis- cussing is no departure from the general doctrine as to past consideration. Where a request is made which is in substance an offer of a promise upon terms to be afterwards ascertained, and services are rendered in pursuance of that request, a sub- sequent promise to pay a fixed sum may be regarded as a part of the same transaction, or else as evidence to assist the jury in determining what would be a reasonable sum. In opposition to this view stands Bradford v. Rotdston.^ In that case it was expressly held that a past consideration, which had taken the form of the execution of a bill of sale to third parties upon the request of the defendant was good con- sideration for a subsequent promise by him to answer for their default. The authorities were elaborately reviewed and the rule in Lampleigh v. Braithwait was adhered to in its literal sense. ^ It is more than doubtful if this Irish decision can now be regarded as good law. Having regard to the judgment in Ken- nedy V. Brown, referred to above, the correct view seems to be that the subsequent promise is only binding when the request, the consideration, and the promise form substantially one transaction, so that the request is virtually the offer of a prom- ise, the precise extent of which is hereafter to be ascertained. This view is supported by the language of Bowen, L.J., in a more recent case: "The fact of a past service raises an implication that at the time it was rendered it was to be paid for, and if it was a service which was o (1835) 1 Bing. (N.C.) 490. h (1858) 8 Ir. C.L. 468. LangdeU, Cont. 450. * This may have been true in fact, but the plaintiS made no such allega- tion, and this was not the theory upon which the case and other early cases were decided. See especially Bosden v. Sir John Thinne, (1603) Yelv. 40, where a later promise was enforced, although the court expressly admitted that "upon the first request only assanvpsit does not lie." 2 See in exact accord, Bosden v. Sir John Thinne, (1603) Yelv. 40. Chap. IV] CONSIDERATION I53 to be paid for, when you get in the subsequent document a promise to pay, that promise may be treated either as an admission which evidences, or as a positive bargain which fixes, the amount of that reasonable remuneration on the faith of which the service was orieinallv rendered."" » ^ In spite, therefore, of the cases decided between 1568 and 1635, and of Bradford v. Roulston (1858), we may say that the rule once supposed to have been laid down in Lamphigh v. Braithwait cannot now be received in such a sense as to form a real exception to the principle that a promise, to be binding, must be made in contemplation of a present or future benefit to the promisor. ISO. Exceptions. (2) Voluntarily doing what another was legally bound to do. We find it laid down that "where the plaintiff voluntarily does that whereunto the defendant was legally compellable, and the defendant afterwards, in consider- ation thereof, expressly promises," he will be bound by such a promise.* But it is submitted that the authority for this rule wholly fails in so far as it rests on the cases which are habitually cited in support of it. The cases all turn upon the liability of parish authorities for medical attendance on paupers who are settled in one parish but resident in another. Watson V. Turner (1767) " was decided on the ground that the moral obligation resting upon overseers of a parish to pro- vide for the poor would support a promise made by them to pay for services previously rendered to a pauper by a medical man. In Atkins v. Banwell (1802) "* it was held that the moral obligation resting upon the parish in which a pauper is settled, to reimburse another parish, in which the pauper happened to be taken ill, for expenses incurred in medical attendance, is not sufficient to create a legal liability without an express promise. In Wing v. Mill (1817),* the pauper was also residing out a Stewart v. Casey, [1892] 1 Ch. 115. 6 1 Sm. L.C. 148. c BuUer, Nisi Friiu, p. 147. But see 1 Selwyn's Nisi Prius, p. 51, n. II. d 2 East, 505. e 1 B. & Aid. 105. '■ "The modem authorities which speak of services rendered upon request as supporting a promise must be confined to cases where the request implies an undertaking to pay." Holmes, J., in Moore v. Elmer, (1901) 180 Mass. 15. In Conant ». Evans, (1909) 202 Mass. 34, it was held that the new promise is not conclusive as to the amount to be paid. 154 THE FORMATION OF CONTRACT [Chap. IV of his parish of settlement; but that parish acknowledged its liability for his maintenance by making him a weekly allow- ance. The pauper fell ill and died; during his illness he was attended by Wing, an apothecary, who, after the pauper's death, was promised payment of his bill by Mill, the overseer of the parish of settlement. The court held the overseer liable. It is not easy to ascertain the grounds of their decision from the judgments of Lord EUenborough, C.J., and Bayley, J. Some sentences suggest that they held, on the authority of Watson V. Turner, that a moral obligation will support a prom- ise; others suggest that they held that there was a legal obliga- tion cast on the parish of residence to do that which the parish of settlement might legally have been compelled to do, and that a quasi-contractual relation thus arose between the parties;" others again suggest that the allowance made to the pauper by the parish of settlement showed a knowledge that the pauper was being maintained at their risk, and amounted to an im- pUed authority for bestowing the necessary medical attendance. This last is the view entertained as to the ratio decidendi in Wing V. Mill by the Court of Exchequer in the only case remain- ing for examination. In Payrder v. Williams^ (1833) the facts were similar to those in Wing v. Mill, with this very important exception, that there was no subsequent promise to pay the apothecary's bill. The defendant parish, the parish of settlement, was never- theless held liable to pay for medical attendance supplied by the parish of residence. The payment of an allowance by the parish of settlement was held by Lord Lyndhurst, C.B., to amount "to a request on the part of the officers that the pauper shall not be removed, and to a promise that they will allow what was requisite." It would seem then that the promise in the cases cited to support this supposed rule, was either based upon a moral obligation, which, since the decision in Eashvood v. Kenyon,' would be insufficient to support it, or was an acknowledgment of an existing liability arising from a contract which might be implied by the acts of the parties, — a liability which, as Paynter v. Williams shows, did not need a subsequent promise to create it. And this is stated on high authority to be the true ground upon which the decision in Watson v. Turner may be supported. a See chapter on Quasi-Contraot. b 1 C. & M. 810. e (1840) 11 A. & E. 438. Chap. IV] CONSIDERATION I55 "The defendants, being bound by law to provide for the poor of the parish, derived a benefit from the act of the plaintiff, who afforded that assistance to the pauper which it was the duty of the defendants to have provided; this was the consideration, and the subsequent promise by the defendants to pay for such assistance was evidence from which it might be inferred that the consideration was performed by the ■plaintiff mth the con- sent of the defendants, and consequently sufficient to support a general indebitatus assumpsit for work and labor performed by the plaintiff /or the defendants at their request." " It is strange that an exception to the general rule as to past consideration, resting on such scanty and unsatisfactory author- ity, should still be regarded as law.* ^ 151. Exceptions. (3) Waiver of statutory privilege. A real exception, however, to the general rule is to be found in the cases in which a person has been held capable of reviving an agreement by which he has benefited, although by rules of law since repealed, incapacity to contract no longer existing, or mere lapse of time, the agreement is not enforceable against him. The principle upon which these cases rest is, "that where the consideration was originally beneficial to the party promising, yet if he be protected from liabiUty by some provision of the statute or common law, meant for his advantage, he may renounce the benefit of that law: and if he promises to pay the debt, which is only what an honest man ought to do, he is then bound by the law to per- form it." " IllustraHons. The following illustrations of the principle are to be found in the reports. a 1 Selwyn"s Nisi Prius, p. 51, n. 11. b These eidola of the textbooks have been stereotyped in the Indian Contract Act, $ 2, sub-8. (d), and § 25, sub-s. 2. c Parke, B., in Earle v. Oliver, (1848) 2 Ex. 90. I But authority is neither scanty nor unsatisfactory to the effect that where the plaintiff has done what it was the defendant's legal duty to do, and the facts were such that the plaintiff's action may be regarded as a public service, the defendant owes a non-contract debt to the plaintiff for the value of the service rendered. In such cases a promise by the defendant is not necessary; but if made, it may be regarded as co-extensive with an already existing legal duty and may be regarded as a new operative fact creating a consensual duty, turning the quasi-contract into contract. Doubt- less, the new promise was unnecessary to recovery; and yet such express recognition by the defendant will certainly strengthen the conviction of the court that a duty already existed. Just as in the case of past service rendered at request, the new promise may be held to be nothing more than evidence of the value of the service. If so, the promise is not in itself an operative fact, and would in no case create a duty to pay more than reason- able value. See Keener, Quasi-Coniracts, chap. 7; Woodward, Quasi-Con- tracts, chap. 14. 156 THE FORMATION OF CONTRACT [Chap. IV (1) A promise by a person of full age to satisfy debts con- tracted during infancy was binding upon him" before the Infants' Relief Act, 1874, made it impossible to ratify, on the attainment of majority, a promise made during infancy.* * (2) A debt barred by the Statute of Limitations is con- sideration for a subsequent promise to pay it." ^ a Williams n. Moor, (1843) 11 M. & W. 256. 6 37 & 38 Vict. o. 62. c 21 Jac. 1, c. 16. ^ An adult may ratify such contracts. Read v. Batchelder, (1840, Mass.) 1 Mete. 559; Hatch v. Hatch, (1887) 60 Vt. 160; Henry v. Root, (1865) 33 N.Y. 526, 545. Some states require the new promise to be in writing. Ante, § 94. See yost, § 158. ' There is no dispute that after a claim has been barred by the Statute of Limitations, it may be revived by a new promise without a new considera- tion. Much effort has been expended, however, in determining the theory upon which the remedy is given. Probably the prevailing theory is that the new promise is in itself the cause of action, being based upon a past con- sideration. See Dusenbury v. Hoyt, (1873) 53 N.Y. 621. In other cases it has been said that the cauie of action is the original transaction, and that the new promise is merely the waiver of a defense. Ilsley v. Jewett, (1841, Mass.) 3 Mete. 439; Way v. Sperry, (1850, Mass.) 6 Cush. 238. Whichever view is taken, it should be held that the new promise determines the extent and conditions of the plaintiff's recovery. Even regarding it as a waiver of a defense, the waiver may be only partial or conditional. Gillingham v. Brown, (1901) 178 Mass. 417. The reasonable theory seems to be that the operative facts upon which the plaintiff's present right is based consist of both the past transaction and the new promise. Prior to the new promise, there was no enforceable right; and the new promise standing alone would not create one. It is of no service, therefore, to say that the new promise is a mere waiver of a defense, and that it is the old right that is being en- forced. The new promise is as necessary as is the old transaction. This is clearly a case where the law looks into the past and finds there a sufficient reason for enforcing a new promise. The same is true of all the other cases in § 151, supra. New promise after a discharge in hanhruptcy. It was formerly held in England that a promise by a bankrupt, made either before or after his dis- charge, to pay the unpaid balance notwithstanding the discharge, was en- forceable at law, the past debt being a sufficient consideration. See True- man V. Fenton, (1777) Cowp. 544; Kirkpatrick v. Tattersall, (1845) 13 M. & W. 766. The English Bankruptcy Acts of 1849 and 1861 provided that such promises should not be binding. The later Bankruptcy Acts of 1869, 1883, and 1914 contain no such provision, and yet the courts have held that the new promise is not enforceable in the absence of a new considera- tion. Heather v. Webb, (1876) 2 C.P.D. 1; Jakeman v. Cook, (1878) 4 Ex. D. 26; Re Bonacina, [1912] 2 Ch. 394. See 1 Smith's Lead. Cas. 168 (12th ed.). The prevailing rule in the United States is that the new promise is en- forceable, the past consideration being sufficient. Dusenbury v. Hoyt, (1873) 63 N.Y. 521; Lawrence v. Harrington, (1890) 122 N.Y. 408; Ed- wards V. Nelson, (1883) 51 Mich. 121; Harrington v. Davitt, (N.Y., 1917) 116 N.E. 476; Zavelo v. Reeves, (1913) 227 U.S. 626; 5 Cyc. 407-10. New promise after a voluntary discharge. The general rule is that a new promise made after a voluntary release by the creditor or after an accord Chap. IV] CONSIDERATION 157 (3) In Lee v. Muggenidge'^ a married woman (who, as the law then stood, was incapable of contracting) gave a bond for money advanced at her request to her son by a former husband. Afterwards, when a widow, she promised that her executors should pay the principal and interest secured by the bond, and it was held that this promise was binding. ^ (4) In Flight v. Reed * bills of exchange were given by the defendant to the plaintiff to secure the repayment of money lent at usurious interest while the usury laws were in force. The bills were by those laws rendered void as between the plaintiff and defendant. After the repeal of the usury laws by 17 & 18 Vict. c. 90 the defendant renewed the bills, the consideration for renewal being the past loan, and it was held that he was liable upon them.^ Common elements in all the cases. There are certain features common to all these cases. The parties are clearly agreed: the contract has been fulfilled for the benefit of one of the parties, while the other cannot get what he was promised, either be- cause he has dealt with one who was incapable of contracting, or because a technical rule of law makes the agreement unen- forceable. If the party who has received the benefit which he expected from the agreement afterwards acquires capacity to a (1813) 5 Taunt. 36. b (1863) 1. H. & C. 703. and satisfaction, such as a voluntary composition with creditors, is not enforceable. They operate much like payment in full and leave no moral obligation. See Shepard v. Rhodes, (1863) 7 R.I. 470; Grant v. Porter, (1884) 63 N.H. 229; cf. Straus v. Cunningham, (1913) 144 N.Y. Supp. (App. Div.) 1014. > Accord: Sharpless' Appeal, (1891) 140 Pa. 63; Goulding v. Davidson, (1863) 26 N.Y. 604, 611, where Balcom, J., says, "I will add that the fact is controlling with me, that the defendant personally received a valuable consideration for the money she has promised to pay, and this distinguishes the case from some that seem to weigh against the conclusion that the defendant's promise is valid." Contra : Holloway ». Rudy, (1901) 22 Ky. L.R. 1406; 60 S.W. 650; Waters v. Bean, (1854) 15 Ga. 358; Kent v. Rand, (1886) 64 N.H. 45; Putnam v. Tennyson, (1875) 50 Ind. 456; Musick i>. Dodson, (1882) 76 Mo. 624; Condon v. Barr, (1886) 49 N.J. L. 53; Hay- ward V. Barker, (1880) 52 Vt. 429. Lee v. Muggeridge is generally disap- proved in the United States, except where a moral consideration will sup- port a promise. See 53 L.R.A. 366-370 n, 7 L.R.A. (N.S.) 1053, 33 L.R.A. (N.S.) 741. ' Hammond v. Hopping, (1835, N.Y.) 13 Wend. 505; Sheldon v. Haxtun, (1883) 91 N.Y. 124. A new promise to pay the sum justly due, excluding the usurious interest, has frequently been enforced. See 39 Cyc. 997; 29 A. & E. Enc. Law, 531. Where a contract was made void by a Sunday law, a new promise to pay, made on a week-day, was enforced in Brewster v. Banta, (1901) 66 N.J. L. 367, 49 Atl. 718. 168 THE FORMATION OF CONTRACT [Chap. IV contract; or if the rule of law is repealed, as in the case of the Usury Acts; or, as in the case of the Statute of Lunitations, admits of a waiver by the person whom it protects, then a new promise based upon the consideration already received is binding. They do not rest upon moral obligation. The cases thus re- garded seem a plain and reasonable exception to the general rule that a past consideration will not support a promise. Unfortunately, they were at one time based upon the moral obligation which was supposed to bind the person benefited and to give efficacy to his promise. ' It would have seemed enough to say that when two persons have made an agreement, from which one has got all the benefit he expected, but is protected by technical rules of law from liability to do what he had promised in return, he wUl be bound if, when those rules have ceased to operate, he renews his original promise. But when once the law of contract was brought into the cloudland of moral obligation, it became extremely hard to say what promises might or might not be enforced; and the language used in some of the cases cited above was calculated to make the validity of contracts turn upon a series of ethical problems. In Lee v. Mtiggeridge," Mansfield, C.J., says, "It has long been established, that where a person is bound morally and conscientiously to pay a debt, though not legally bound, a subsequent promise to pay will give a right of action. The only question therefore is whether upon this declaration there appears a good moral obligation." In no case did "moral obligation" play a more prominent part than in Lee v. Muggeridge; but the doctrine, after it had undergone some criticism from Lord Tenterden,* was finally limited by the decision in Eastwood v. Kenyan. Eastwood had been guardian and agent of Mrs. Kenyon, and, while she was a minor, had incurred expenses in the improvement of her prop- erty: he did this voluntarily, and in order to do so was com- pelled to borrow money, for which he gave a promissory note. a (1813) 5 Taunt. 46. b Littlefield v. Sbee, (1831) 2 B. & Ad. 811. 1 The practice is almost universal, in the cases dealt with in this section, to say that the consideration is the moral obligation. No doubt this term is of too uncertain a connotation to make its use desirable here. Perhaps it is a better form of expression to say that in these classes of cases it is so generally and so certainly believed that the debtor ought to pay, if he can, that the law empowers him to bind himself to do so by making a mere voluntary promise. It is not that all moral obligations are sufficient; but these selected classes of moral obligations are sufficient. Chap. IV] CONSIDERATION 159 When the minor came of age she assented to the transaction, and after her marriage her husband promised to pay the note! Upon this promise he was sued. The moral duty to fulfill such a promise was insisted on by the plaintiff's counsel, but was held by the court to be insufficient where the consideration was wholly past. "Indeed," said Lord Denman in delivering judg- ment, "the doctrine would annihilate the necessity for any consideration at all, inasmuch as the mere fact of giving a prom- ise creates a moral obUgation to perform it." " ' Thus was finally overthrown the doctrine formulated by Lord Mansfield that consideration was only one of various modes by which it could be proved that parties intended to contract: a doctrine which, in spite of the decision in Rann v. Hughes,^ survived in the theory that the existence of a moral obUgation was evidence that a promise was intended to be bind- ing. Consideration is not one of several tests, it is the only test of the intention of the promisor to bind himself by contract.* a (1840) 11 A. & E. 450. !i (1778) 7 T.R. 350, note. _ 1 The general doctrine of promises which operate as waivers of a tech- nical bar interposed by law, is well stated and discussed in Smith v. Tripp, (1883) 14 R.I. 112. -: Another instance of such waivers is the case of a promise by an indorser or drawer of a negotiable instrument, who has been discharged for want of due notice of dishonor. Sigerson v. Mathews, (1857, U.S.) 20 How. 496; Ross V. Hurd, (1877) 71 N.Y. 14; Rindge v. KimbaU, (1878) 124 Mass. 209; Hobbs V. Straine, (1889) 149 Mass. 212. Negotiable Inst. Law, §§ 109-111 (N.Y. 180-182). See 29 L.R.A. 305; 3 L.R.A. (N.S.) 1079. Also, for waiver before maturity, L.R.A. 1916 B, 944. Another exception to the rule that a past consideration will not support a promise exists in the case where a debtor ^ives additional security to his creditor, or a principal to his surety, on a pre-existing debt, without any new consideration. "No case can be found in which a man's own debt has been ruled to be an insufficient consideration between him and his creditor, for a mortgage or other security received by the latter from his debtor." Turner v. McFee, (1878) 61 Ala. 468, 472; Paine v. Benton, (1873) 32 Wis. 491; Duncan v. Miller, (1884) 64 Iowa, 223; Williams v. Silliman, (1889) 74 Tex. 626. So the transfer of a negotiable instrument as security for a pre-existing debt is on a sufficient consideration as between the parties; whether it is as to third parties the American cases are not agreed. Cod- dington v. Bay, (1822, N.Y.) 20 Johns. 637; Railroad Co. v. National Bank, (1880) 102 U.S. 14. See Negotiable Instruments Law, § 25 (N.Y. § 51). ' This seems to be altogether too narrow and dogmatic. Consideration is not merely an eindenticd fact, with the intention of the promisor as the sole operative fact. Without consideration, the promisor can safely confess in open court that it was his intention to be legally bound. And in some in- stances he will be held to have contracted, even though it is now clear that he did not intend to be bound. (See ante, § 6, and notes). Consideration is itself an operative fact, which, added to a promissory expression, creates legal duty. (See artie, § 118, note.) 160 THE FORMATION OF CONTRACT [Chap. IV 152. Foreign contracts and the doctrine of consideration. We have been discussing throughout this chapter the rules of English law relating to consideration. It must not, however, be forgotten that English courts may from time to time have to entertain actions relating to contracts which are not governed by English law. The rules which determine the law which gov- erns a contract, or, as it is called, the "proper law" of the con- tract, are a branch of private international law and cannot be discussed at length in this place. It is sufficient to say that the intention of the parties is the determining factor, and, where that intention has either not been expressed or cannot be collected from the terms and circumstances of the contract, the lex lod contracius, the law of the place where the contract is made, is presumed to be the law by which the parties intended their contract to be governed. The reader will do well to refer to the case of the British Sovih Africa Company v. Be Beers Mines" in which he will find all the authorities upon the subject reviewed. If therefore it should be ascertained that the proper law of the contract before the court is not the law of England, the question whether the contract is a valid one will not be determined by English law, and reference must be made to the proper law of the contract to determine whether considera- tion is required for its validity. This is what happened in the case of In re Bonacina,^ where the effect of a "privata scrittura" in Italian law was considered. It was proved that a promise in this form based upon the moral obligation to pay a just debt created according to Italian law a new and valid legal obligation which would be enforced in the Itahan courts. The proper law of contract being Italian law, the Court of Appeal held that the English doctrine of consideration did not apply, and that the contract, being valid by its proper law, was enforceable in England, although, if it had been an English contract, it would have been invalid for want of consideration. a [1910] 1 Ch. 354; 2 Ch. 602. h [1912] 2 Ch. 394. CHAPTER V Capacity of Parties 153- Contractual disabilities. * In the topics which we have hitherto discussed we have dealt with the primary elements of contract. The parties must be brought together by offer and acceptance, and they must make an agreement which the courts will regard as a legal transaction either by reason of its form, or because of the presence of consideration. But such a transaction may take place between parties, one or both of whom are under some disability for making a valid contract: it is therefore necessary to deal with these disabili- ties: in other words, with the capacity of parties. Certain persons are by law incapable, wholly or in part, of binding themselves by a promise, or of enforcing a promise made to them. And this incapacity may arise from the fol- lowing causes: (1) Political or professional status. (2) Youth, which, until the age of 21 years, is supposed to imply an immaturity of judgment needing the protection of the law. (3) Artificiality of construction, such as that of corporations, which, being given a personality by law, take it upon such terms as the law imposes. (4) The permanent or temporary mental aberration of lunacy or drunkenness. (5) Marriage. Until the 1st of January, 1883, marriage effected a merger of the contractual capacity of the wife in that of her husband, subject to certain exceptions. The Married Women's Property Acts of 1882 and 1893 have greatly changed the law in this respect. 1. Political or Professional Stakes 154. Aliens. An alien has ordinarily the contractual capacity of a natural-bom British subject, except that he cannot acquire property in a British ship.* ' Disability is the opposite of power and the correlative of immunity. The "capacity" of a party means the sum-total of his legal powers to create new legal relations by his voluntary acts. ' An alien cannot acquire property in an American ship or be an ofBcer 162 THE FORMATION OF CONTRACT [Chap. V Alien enemies. In time of war, however, an alien who is an enemy, so far as concerns his capacity to contract or to enforce contracts already made, is subject to severe restrictions. For the purposes of the war of 1914^1918 these restrictions were still further increased by Trading with the Enemy Acts which make commercial dealings of all kinds, direct and indirect, with the King's enemies a criminal offense; but it will be sufficient here to indicate the common-law rules upon the subject. We must note in the first place that nationality is not the test of enemy status for this piu:pose. The full Court of Appeal in Porter v. Freitdenberg," after reviewing all the authorities, has laid it down that the place where the person in question voluntarily resides or carries on business is the determining factor; so that an enemy subject who resides or carries on busi- ness exclusively in a neutral country or (with the license of the Crown) in Great Britain itself, may contract or sue on the same footing as an alien friend. The position of an alien enemy as above defined appears to be as follows.' (1) He cannot enter into any contract with a British subject during the continuance of the war. (2) He cannot until the war is over sue in the King's Courts on any a [19151 1 K.B. 857. of one. U.S. Rev. St. § 4131. In many states an alien cannot acquire and hold title to real property. See 2 Kent, Comm. 54-64. But state laws as to rights of aliens yield to treaties made by the United States. Hauenstein v. Lynham, (1879) 100 U.S. 483. 1 Any fresh contract across the lines of hostilities is illegal. United States V. Grossmayer, (1869, U.S.) 9 Wall. 72; Griswold v. Waddington, (1819, N.Y.) 16 Johns. 438. But if an alien enemy is permitted to remain in the hostile country contracts made there are vaUd. Kershaw v. Kelsey, (1868) 100 Mass. 561; Conrad v. Waples, (1877) 96 U.S. 279; U.S. v. Quigley, (1880) 103 U.S. 595. An aUen enemy resident in his own country cannot sue in our courts, but he may be sued if he or his property can be reached by process. Masterson v. Howard, (1873, U.S.) 18 Wall. 99; Dorsey v. Kyle, (1869) 30 Md. 512, 96 Am. Dec. 617, note 630-33. The statute of Umita- tions is suspended during hostiUties. Brown v. Hiatts, (1872, U.S.) 15 Wall. 177. An alien enemy who is permitted to reside here and do business can also maintain suit. Clarke v. Morey, (1813, N.Y.) 10 Johns. 69; Posselt v. D'Espard, (1917, N.J. Ch.) 100 Atl. 893. The "Trading with the Enemy" Act of Oct. 6, 1917, appears to apply only in case of persons resident in or carrying on business within the territory of the enemy country. See 27 Yde Law Journal, 104. As to whether a domestic corporation, most of whose shareholders are alien enemies, is itself incapable of suing or of doing business, see Daimler v. Continental Tyre Co., [1915] 1 K.B. 893; Fritz Schultz Co. v. Raimes, (1917) 166 N.Y. Supp. 567; Mines de Barbary v. Raymond, (1916, Court of Paris) 44 Clunet, 226; 27 Yale Law Journal, 108, 657. Chap. V] POLITICAL OR PROFESSIONAL STATUS 163 cause of action which has accrued before the war." (3) He may be sued on a cause of action which has accrued before the war and may appear and defend the action, and, if unsuccessful, may appeal to a higher tribunal.* (4) Contracts made before the war with an alien enemy the performance of which would involve continual commercial intercourse of a kind which the outbreak of war has made illegal, such as a partnership, are wholly dissolved, as are also (it would seem) contracts which, if performed, would be of substantial assistance to the commerce of the enemy's state or detrimental to the interests of this coun- try." 1 (5) In the case of contracts not falling within the above description, performance is prohibited for the duration of the war, and therefore no cause of action can be maintained subse- quently in respect of non-performance during the war. Often this will be practically equivalent to a dissolution, as for exam- ple in the case of a contract to deliver goods within a specified time. If the war lasts beyond the time fixed for delivery, neither party has any rights against the other after the conclusion of peace. In other cases the rights and liabilities under the con- tract will apparently revive when the war is over. Thus it can scarcely be supposed that a British Company could refuse to pay the executors of one of their policy-holders on the ground that during the currency of the policy the policy-holder has for a period been an alien enemy. The law on the point is, however, not altogether clear, and where the war has so far affected per- formance that in normal circumstances the other party to the contract would have been justified in refusing to be boimd any longer by it, it is probable that the contract is at an end, even though by its terms it was to continue beyond the period of the war. This, however, relates rather to the discharge than to the formation of contract. The Crown may at its discretion grant a license to an alien enemy to contract and sue in time of war, and in that case his position will be exactly the same as that of an alien friend. Foreign sovereigns. The position of foreign states and sover- eigns may also be conveniently referred to in this connection. They have full capadiy to enter into contracts in England, but neither they nor their representatives nor the officials and house- hold of their representatives are in any way subject to the o Brandon v. Nesbitt, (1794) 6 T.H. 23. 6 Porter v. Freudenberg, [1915] 1 K.B. 857. c Zinc Corporation v. Hirsoh, [1916] 1 K.B. 541. » Griswold V. Waddington, (1819, N.Y.) 16 Johns. 438. 164 CAPACITY OF PARTIES [Chap, V jurisdiction of the English Courts," and it is even doubtful whether they can voluntarily subject themselves to it.* Their contracts cannot therefore be enforced against them, although they are capable of enforcing them. This immunity extends to a British subject accredited to Great Britain by a foreign state." 1 A modem case illustrates the rule. A foreign sovereign resid- ing in this coimtry as a private person, made a promise of marriage imder an assmned name. He did not thereby subject himseK to the jiu*isdiction of our courts, and so could not be sued for breach of his promise.'' 155. Felon undergoing sentence. A person convicted of treason or felony cannot, during the continuance of his sentence, make a valid contract; nor can he enforce contracts made previous to conviction: but these maybe enforced by an admin- istrator appointed for the purpose by the Crown.' ^ 156. Barristers and physicians in England. A barrister cannot sue for fees due to him for services rendered in the ordi- nary course of his professional duties, whether the action be framed as arising upon an implied contract to pay for services a 7 Anne, 0. 12; Taylor v. Beat (1854) 14 C.B. 487* b In re Bolivia Exploration Syndicate, [1914] 1 Ch. 139. c Macartney s. Garbutt, (1890) 24 Q.B.D. 368. d Mighell ». The Sultan of Johore, [1894] 1 Q.B. (C.A.) 149. e 33 & 34 Vict. c. 23, §§ 8, 9, 10. * In accord is Re Suarez, (1917, Ch. D.) 117 L.T. 239; 27 Yak Law Jour- nal, 392. A siimlar statute in the United States is U.S. Rev. St. §§ 4063-64. The immunity of a sovereign is not lost by virtue of his becoming a part- ner in a commercial enterprise. The Parlement Beige, (1880, C.A.) 5 P.D. 197, 216; Mason v. Intercolonial Ry., (1908) 197 Mass. 349. Nor does a sovereign, by voluntarily bringing suit against one party, waive his immun- ity from an interpleader by a third party. Kingdom of Roumania v. Guar- anty Trust Co., (1918, CCA.) 250 Fed. 341, reversing 244 Fed. 195. By statute,' a defendant sued by the United States may set off amounts due him in reduction of the plaintiff's claim. United States v. Wilkins, (1821, U.S.) 6 Wheat. 135. But no afSrmative judgment will be rendered against the sovereign. United States v. Eckford, (1867, U.S.) 6 Wall. 484; People V. Dennison, (1881) 84 N.Y. 272. See 27 Yale Law Journal, 278. 1 See 1 Kent, Comm. 38-39; Holbrook v. Henderson, (1851, N.Y.) 4 Sandf. 619; In re Baiz, (1890) 135 U.S. 403. The exemption does not extend to consuls. Bors v. Preston, (1883) 111 U.S. 252; Wilcox v. Luco, (1897) 118 Cal. 639. ' In the absence of prohibitory statutes a convict may make contracts [Stephani v. Lent, (1900) 30 N.Y. Misc. 346, 63 N.Y. Supp. 471], or sue or be sued upon contracts. Wilson v. King, (1894) 59 Ark. 32; Dade Coal Company v. Haslett, (1889) 83 Ga. 549; Kenyon v. Saunders, (1894) 18 R.I. 590; Byers v. Sun Sav. Bank, (1914, Okl.) 139 Pao. 948. See Avery v. Everett, (1888) 110 N.Y. 317; 18 L.R.A. 82, note; 9 Cyo. 870-75. Chap. V] INFANTS 165 rendered on request, or upon an express contract to pay a cer- tain sum for the conduct of a particular business." A physician, until the year 1858, was so far in the position of a barrister that the rendering of services on request raised no implied promise to pay for them, though the patient might bind himself by express contract. The Medical Act (1858, 21 & 22 Vict. c. 90, § 31) enabled every physician to sue on such an impUed contract, subject to the right of any college of physi- cians to make by-laws to forbid the exercise of this privilege by their Fellows. And this is re-enacted in substance by the Medical Act 1886.'' i 2. Infants IS7. Infants' contracts voidable. The rights and liabilities of infants imder contracts entered into by them during infancy ^ rest upon common law rules which have been materially affected by statute. I will first state the conamon law upon the subject.' At common law there were but two classes of contracts which though made by an infant were as valid as though made by a person of full age; namely, contracts for necessaries and (in certain cases) contracts for the infant's benefit. In all other cases common law treated an infant's contracts as being voidable at his option, either before or after the attain- ment of his majority; and Sir F. Pollock in an exhaustive argu- ment has shown that this was so, even where the contract was not for the infant's benefit." But these voidable contracts must be divided under two heads: a Kennedy v. Broun, (1863) 13 C.B. (N.S.) 677. 6 49 & 50 Vict. o. 48, § 6. c Pollock on Contracts (8th ed.), 56-61. 1 In the United States lawyers and physicians who are duly licensed are under no such disability. Shelton v. Johnson, (1874) 40 Iowa, 84; VUas v. Downer, (1849) 21 Vt. 419; Garrey v. Stadler, (1886) 67 Wis. 512. It has been held in New York that because of the fiduciary nature of the relation, a client may properly discharge his attorney at any time, in spite of an agreement to the contrary, the attorney being entitled only to guan- tum meruit and not to damages. Martin v. Camp, (1916) 219 N.Y. 170; In re City of New York, (1916) 219 N.Y. 192. Contra: Bartlett v. Odd Fellows Savings Bank, (1889) 79 Cal. 218; Moyer v. Cantieny, (1889) 41 Minn. 242; Scheinesohn v. Lemonek, (1911) 84 Ohio St. 424. * The age of majority for women is fixed at eighteen in some states. Stimson, Am. St. Law, § 6601. Majority is reached on the first minute of the day preceding the twenty-first birthday. Bardwell v. Purrington, (1871) 107 Mass. 419; Hamlin v. Stevenson, (1836, Ky.) 4 Dana, 597. Some states provide that emancipation may hasten the age of majority. Stimson, Am. St. Law, § 6606. » See American note, vo^t, §§ 161-161b. 166 CAPACITY OF PARTIES [Chap. V (a) Contracts which were valid and binding on the infant unUl he disaffirmed them, either during infancy or within a reasonable time after majority; (6) Contracts which were not binding on the infant until he ratified them within a reasonable time after majority.* 158. Ratification by mere enjoyment of benefits. Where an infant acquired an interest in permanent property to which obhgations attach, or entered into a contract involving con- tinuous rights and duties, benefits and Habilities, and took some benefit under the contract, he would be bound, unless he ex- pressly disclaimed the contract.' Illustrations may be found in the following cases. They do not appear to be affected by subsequent legislation. An infant lessee who occupies until majority is liable for arrears of rent which accrued during his minority." ^ Shareholders who became possessed of their shares during in- fancy are hable for calls which accrued while they were infants.' The grounds of infants' liabiUty under these conditions have 'been thus stated: "They have been treated therefore as persons in a different situation from mere contractors, for then they would have been exempt: but in o Rolle, Abr. 731. 1 The text here creates difficulty because of the failure to analyse "con- tract" and to sever the acts of the parties and other factual elements from the legal relations that are consequent thereon. Suppose the infant's act is a mere executory promise; this act is "valid" (legally operative) to create in the infant a legal power as explained infra, §§ 161-161b. It creates no duty whatever, for the infant is legally privileged not to perform what he promised. The adult's executory promise creates a legal duty in him, but there is also the liability that this duty will be destroyed by the exercise of the infant's power. In cases where one act of the infant is the act of conveying property, the act is "valid" to create certain property relations. The grantee gets a right of possession against all but the infant (who still retains the right and privilege of entry to disaffirm); he gets the power of conveying the property to third persons; he has the privilege of use and enio3Tnent. He has not the usual immunity, however; for the infant has the power of disaffirmance, the power to destroy the foregoing rights, powers, and privileges of the grantee. It will be observed, therefore, that in both classes of cases the infant's act will be "vaUd" (legally operative) for certain purposes and not for others; it will create certain legal relations and not others. See American note, post, §§ 161-161b. 2 See McClure v. McClure, (1881) 74 Ind. 108. But not in an action brought during the infancy of the lessee. Flexner v. Dickerson, (1882) 72 Ala. 318. See 18 Am. St. Rep. 589-92. ' A piu-chase of shares may be avoided and the purchase money re- covered. Indianapolis Chair Mfg. Co. v. Wilcox, (1877) 59 Ind. 429; Ham- ilton V. Vaughan, etc., Eng. Co., (1894) L.R. 3 Ch. 589. Chap. V] INFANTS 167 truth, they are purchasers who have acquired an interest, not in a mere chattel, but in a subject of a permanent nature, either by contract with the company, or purchase or devolution from those who have contracted, and with certain obligations attached to it which they were bound to discharge, and have been thereby placed in a situation analogous to an infant purchaser of real estate who has taken possession, and thereby becomes liable to all the obligations attached to the estate; for instance, to pay rent in the case of a lease rendering rent, and to pay a fine due on the admission in the case of a copyhold to which an infant has been admitted, unless they have elected to waive or disagree the purchase alto- gether, either during infancy or after full age, at either of which times it is competent for an infant to do so." * * Similarly an infant may become a partner, and at common law may be entitled to benefits, though not liable for debts, arising from the partnership during his infancy. Equity how- ever would not allow an infant, in taking the partnership ac- counts, to claim to be credited with profits and not debited with losses. But what is important for our present purpose to note is, that imless on the attainment of majority there be an express rescission and disclaimer of the partnership, the partner will be liable for losses accruing after he came of age.' ^ Where an infant held himself out as in partnership with X, and continued to act as a partner till shortly before he came of age, and then, though ceasing to act as a partner, did nothing to disaffirm the partnership, he was held liable on debts which accrued, after he came of age, to persons who supplied X with goods. a Evelyn v. Chichester, (1765) 3 Burr. 1717; N.W. R. Co. v. McMiohael, (1850) 5 Ex. 114. b Lindley, Partnership (7th ed.), 88, 89. » See 18 Am. St. Rep. 615-18. ' It has been held that acting as a partner after majority renders an infant liable for debts of the firm contracted dm'ing his minority. Miller v. Sims, (1834, S.C.) 2 HiU, 479, and see Penn v. Whitehead, (1867, Va.) 17 Gratt. 503. Compare Crabtree v. May, (1841, Ky.) 1 B. Men. 289. An infant may disaffirm his partnership contract, but the assets of the firm will be devoted to the pajmient of creditors before he can withdraw his contribution. Shirk v. Shultz, (1887) 113 Ind. 571; Yates v. Lyon, (1874) 61 N.Y. 344; Moley v. Brine, (1876) 120 Mass. 324. The assets of the firm represent the consideration received by the firm for that which has been paid out and for the promises they have made. The infant no doubt has the power to disaffirm each individual contract that he, as a member of the firm, has made with third parties; but it is not equitable to allow him to keep these assets and at the same time to disaffirm. The complexity result- ing from the large number of persons involved no doubt makes it more difficult to work out a complete disaffirmance. Subject to the rights of creditors and to losses suffered, he may recover the fund he has contributed. Sparman v. Keim, (1880) 83 N.Y. 245. See 18 Am. St. Rep. 601-05. 168 CAPACITY OF PARTIES [Chap. V "Here," said Best, J., "the infant, by holding himself out as a partner, contracted a continual obligation, and that obliga- tion remains till he thinks proper to put an end to it. . . , If he wished to be understood as no longer continuing a partner, he ought to have notified it to the world." " And so where shares were assigned to an infant who attained his majority some months before an order was made for winding up the company, it was held that in the absence of any disclaimer of the shares the holder was liable as a contributory.* Although the liabilities incurred by the infant are somewhat different in these different cases, yet there is this feature com- mon to all of them, that nothing short of express disclaimer will entitle a man, on attaining his majority, to be free of obli- gations such as we have described. iS8a. When an express ratification is necessary. In the case of contracts that are not thus continuous in their operation, the infant was not bound unless he expressly ratified them upon coming of age. Thus a promise to perform an isolated act, such as to pay a reward for services rendered, or a contract wholly executory, and indeed all other contracts other than continuing contracts or contracts for necessaries or for the infant's benefit required an express ratification. ' Such was the common law upon the subject: let us consider how it has been affected by legislation. 159. English statutory changes. The Infants' Relief Act of 1874 appears to have been designed to guard not merely against the results of youthful inexperience, but against the conse- quences of honorable scruples as to the disclaimer of contracts upon the attainment of majority. Its provisions are as follows: 1. "All contracts whether by specialty or by simple contract hence- forth entered into by infants for the repayment of money lent or to be lent, or for goods supplied or to be supplied (other than contracts for necessaries), and all accounts stated with infants, shall be absolutely void: provided always that this enactment shall not invalidate any contract into which an infant may by any existing or future statute, or by the rules of common law or equity enter, except such as now by law are voidable. 2. "No action shall be brought whereby to charge any person upon any promise made after full age to pay any debt contracted during infancy, or upon any ratification made after full age of any promise or o Goode I. Harrison, (1821) 5 B. & Aid. 159. 6 Lumsden's Case, (1868) 4 Ch. 31. 1 See infra, §§ 16I-161a. Chap, V] INFANTS 169 contract made diiring infancy, whether there shall or shall not be any new consideration for such promise or ratification after full age." " The precise meaning of the provisions of this Act is not easy to ascertain, but its effect may be summarized as follows: 1. Three classes of infants' contracts are, for the first time, made absolutely void; namely, for money lent or to be lent; for goods supplied or to be supplied (other than necessaries) ; and accounts stated. 2. (o) Contracts for necessaries supplied or to be supplied are valid and binding on an infant (as they have always been), and so also are (6) contracts into which an infant could validly enter at the date of the Act and which at the same time were not void- able by him; that is, certain contracts for the infant's benefit. 3. It is no longer possible for an infant to ratify after major- ity that class of contracts which before the Act were invalid until aflirmed; and this is so, whether there is a new considera- tion for the promise or ratification after majority or not. 4. Contracts which before the Act were valid imtil disaffirmed are not affected by the Act. We may now consider these foiir points in greater detail. Jvdicial construction ofsecUon 1. Section 1 of the Act has been strictly construed. An infant who had contracted trading debts was convicted on an indictment charging him with having defrauded his creditors within the meaning of the Debtors' Act, 1869.'' The conviction was quashed on the ground that the transactions which resulted in debts were void under the Infants' Relief Act. There were consequently no creditors to defraud." On the same reasoning an infant cannot be made a bankrupt in respect of such debts.** And the Court of Appeal has held that a false representation by an infant that he was of full age, whereby the plaintiff was in- duced to lend him money, caimot impose any contractual liabil- ity upon him by way of estoppel or otherwise; for the Act makes such a contract absolutely void.' But, it may be asked, can an infant who has received goods and paid their price recover his money, or the tradesman his goods, on the groimd that the transaction is void? This much is clear, that if an infant has paid money and taken benefit under the contract he cannot recover the money so paid. An infant hired a house and agreed to pay the landlord £100 o 37 . Cannon, (1849) 6 Ga. 382; McCarty v. Woodstock Iron Co., (1890) 92 Ala. 463. 2 Riggs V. Fisk, (1878) 64 Ind. 100; Craig v. Van Bebber, (1890) 100 Mo. 684. The question whether the new deed operates to convey legal title, in cases where the first grantee still retains possession, depends upon the law of the jurisdiction with reference to conveyances by one disseized. That such a conveyance is not valid, see Harris v. Cannon, supra ; Riggs ». Fisk, supra. Contra, Cresinger ». Welch's Lessee, (1846) 15 Ohio, 156. A quit- claim deed is no disaffirmance because not necessarily inconsistent with the previous deed. Singer Mfg. Co. v. Lamb, (1883) 81 Mo. 221. Contra, Bagley v. Fletcher, (1884) 44 Ark. 153. ' Bozeman v. Browning, supra. * Mansfield v. Gordon, supra. s Stafford v. Roof, (1827, N.Y.) 9 Cow. 626; Towle v. Dresser, (1882) 73 Me. 252; Pippen v. Ins. Co., (1902) 130 N.C. 23; Chapin v. Shafer, (1872) 49 N.Y. 407; Nichols v. Snyder, (1900) 78 Minn. 502. Contra, Lansing v. Mich. Cent. R.R. Co., (1901) 126 Mich. 663. » Edgerton v. Wolf, (1856, Mass.) 6 Gray, 453; McCarty v. Woodstock Iron Co., supra. » Singer Mfg. Co. v. Lamb, (1883) 81 Mo. 221; Shipley v. Bunn, (1894) 125 Mo. 445 (infant cannot maintain ejectment); Stafford v. Roof, (1827, N.Y.) 9 Cow. 626 (semftie); Doe v. Leggett, (1862) 53 N.C. 425 (ejectment refused). In the following cases a demurrer was sustained to a bill by the infant asking cancellation, a quieting of title, and possession: Irvine v. Irvine, (1860) 5 Minn. 61; Cummings v. Powell, (1852) 8 Tex. 80; Welch v. Dunce, (1882) 83 Ind. 382. Chap.V] infants 183 conveyance could not be made when land wag in the adverse possession of another. It appears that the infant has the right and privilege of entry, i Such an entry would seem to termmate the grantee's right of possession, his privilege of use, and, in most states at least, his power to convey title. This nullifies, in large measure, the effect of the previous deed. No very good reason is apparent why such a re-entry should not again invest the infant with the same power of conveyance that he had in the first place, now that the land is no longer in the adverse posses- sion of another, but this power he seems not to regain before majority. Likewise, the infant's re-entry does not terminate his power of ratification after majority. (3) Effed of infant's false representaiion as to Ms age. The fact that the infant falsely represented himself to be of age, and thus induced the other party to contract with him, does not affect his power of disaffirmance. He is not bound by estoppel." In Eng- land, the court of equity showed some disposition to lay down the contrary rule,' but it has not been followed in the United States.* (4) The right of restituticm after disaffirmance, (a) The right of the infant. After an effective disaffirmance the infant has a right to recover back the specific res transferred by him, if it is still in existence. This right is enforceable in replevin or in trover in case the holder of the res refuses to give it up on demand,* even though such holder is an innocent purchaser for value.* A dis- affirmance has no effect (by the fiction of relation back) to make tortious the acts of the transferee done prior to the disafiirm- » Stafford v. Roof, supra (senible); Bool v. Mix, (1837, N.Y.) 17 Wend. 119 (semble); Matthewson v. Johnson, (1840, N.Y.) 1 Hoff. Ch. 560 (semhk); Oummings v. Powell, supra (sembk). ' Merriam v. Cunningham, (1853, Mass.) 11 Cush. 40; Bartlett v. Wells, (1862) 1 Best & S. 836; New York Bldg. L. & B. Co. v. Fisher, (1897, N.Y.) 23 App. Div. 363; Carpenter v. Carpenter, (1873) 45 Ind. 142. • Watts V. Creswell, 9 Vin. Abr. 415; Ex parte Unity, etc. Ass'n, (1858) 3 De Gex & J. 63; Levene v. Brougham, (1908) 24 T.L.R. 801. * In Sims v. Everhardt, (1880) 102 U.S. 300, it was held that the false- hood would not prevent the granting of affirmative equitable relief to the infant. Some eases refuse equitable relief to such an infant. Schmitheimer V. Eiseman, (1870, Ky.) 7 Bush. 298. In one case equity granted an injunc- tion preventing the infant from enforcing his judgment in ejectment ob- tained after a disaffirmance. Ferguson v. Bobo, (1876) 54 Miss. 121. 6 Towle V. Dresser, (1882) 73 Me. 252. « Hill V. Anderson, (1845, Miss.) 5 Sm. & M. 216; Brantley v. Wolf, (1882) 60 Miss. 420 (land); Wallace v. Leroy, (1905) 67 W.Va. 263 (.sembk); Down- ing V. Stone, (1891) 47 Mo. App. 144. 184 CAPACITY OF PARTIES [Chap. V ance.' If the value given by the infant consisted of money (and hence not traceable), or of services, or of some res that no longer exists in specie, he can sue his transferee in quasi-contract for the value thereof. 2 There is much conflict as to whether the infant must return or tender the consideration received by him as condition precedent to his right of restitution. It is often stated that an infant can- not recover the consideration paid by him unless he can and does return the value that he received from the defendant.' Some of the cases so holding would be sustainable under the following rule, laid down by one court: Where the contract was fair and reasonable and not detrimental to the infant, and where he re- ceived value that was in itself as beneficial to his estate as was that which he gave, he cannot recover the latter without return- ing the consideration received by him.^ No doubt most of the English cases holding that an infant is bound by his contracts if they are beneficial to him fall within the foregoing principle.' It is often held that if during infancy the infant has wasted what he received, he may recover from the defendant all that he paid or gave.^ Probably the majority of American cases lay down the rule that an infant can in all cases disaffirm and recover the consideration given by him without first return- ing what he received.' This last rule is held in all courts to ' Fitts V. Hall, (1838) 9 N.H. 441; Drude «;. Curtis, (1903) 183 Mass. 317; Lamkin v. Ledoux, (1906) 101 Me. 581. 2 Derocher v. Continental MiUs, (1870) 58 Me. 217 (the defendant can- not recoup his damages caused by plaintiff's non-performanoe) ; Waugh v. Emerson, (1885) 79 Ala. 295 (defendant can reduce plaintiff's claim by proving value paid by the defendant) ; Weaver v. Jones, (1854) 24 Ala. 420 (defendant bound to pay for use and occupation of land with a reduction for improvements). The infant also has a quasi-contractual right to compensation for services and feed furnished by him to cattle bought from the adult and now returned. Tower-Doyle Com. Co. v. Smith, (1900) 86 Mo. App. 490. 3 Rice V. Butler, (1899) 160 N.Y. 578; Bartholomew!). Finnemore, (1854, N.Y.) 17 Barb. 428; Hillyer v. Bennett, (1838, N.Y.) 3 Edw. Ch. 222 (reUef in equity denied) ; Bailey v. Bamberger, (1850, Ky.) 11 B. Men. 113; Lane v. Dayton Coal & Iron Co., (1899) 101 Tenn. 581; Hall v. Butterfield, (1879) 59 N.H. 354; Kerr v. Bell, (1869) 44 Mo. 120. * Johnson v. Northwestern M.L. Ins. Co., (1894) 56 Minn. 365. 5 See Clements v. London & N.W. Ry. Co., [1894] L.R. 2 Q.B.D. 482; Hohnes v. Blogg, (1818) 8 Taunt. 508. Cf . FeUows v. Wood, (1888) 59 L.T. 613. 6 Green v. Green, (1877) 69 N.Y. 553; Eureka Co. ». Edwards, (1881) 71 Ala. 248; Brantley v. Wolf, (1882) 60 Miss. 420; Harvey v. Briggs, (1890) 68 Miss. 60; Craig v. Van Bebber, (1890) 100 Mo. 584. ' Miller v. Smith, (1879) 26 Minn. 248 (he had wasted what he received); Chap. Y] INFANTS 185 apply in cases where the infant has conveyed away his real property.^ (b) The rigU of the other -party. If the infant still retains in specie what he has received, his disaffirmance revests title thereto in the other party, with the usual consequences thereof. The in- fant is not liable in a tort action for his acts prior to disaffirm- ance, but a subsequent refusal to give up a chattel that is still in his possession is a wrongful conversion.* If the infant does not retain in specie what he received, but he still has its value in some other form, he can be compelled in equity to give up this value.^ This recovery is quasi-contractual in character, and should be allowed in indebitatus assumpsit as well as in equity. If the consideration received has been wasted during iafancy the adult is generally held to have no remedy.* The following appears to be a just and equitable rule: Where the value given by an infant is greater than the value received, he can recover the difference. He can recover the whole of that given by him if he can and does put the other party in statu quo by returning all the value received. Where the value given by the defendant to the infant has been squandered or lost during infancy in such fashion that it cannot now be traced or its value recovered and in the opiaion of the jury the value given by the infant to the defendant would not have been so squandered or lost, then the infant can recover the whole value of that which he gave to the defendant. 162. Liability of infant for tort. An infant is liable for wrong: but a breach of contract may not be treated as a wrong so as to make the infant liable; the wrong must be more than a misfea- Gillis V. Goodwin, (1901) 180 Mass. 140; Simpson v. Prudential Ins. Co., (1903) 184 Mass. 348; Carpenter v. Carpenter, (1873) 45 Ind. 142; Morse v. Ely, (1891) 154 Mass. 458; Dill v. Bowen, (1876) 54 Ind. 204; Barr v. Pack- ard Motor Co., (1912) 172 Mich. 299; Reynolds v. Garber-Buick Co., (1914) 183 Mich. 157. ' Johnson v. Northwestern M.L. Ins. Co. supra (semble); Chandler v. Simmons, (1867) 97 Mass. 508; Ison v. Cornett, (1903) 116 Ky. 92. ' Chandler v. Simmons, supra (semble); Ison v. Cornett, supra (semble); Bennett v. McLaughlin, (1883) 13 111. App. 349; Badger v. Phinney, (1819) 15 Mass. 359; Strain v. Wright, (1849) 7 Ga. 568; Fitts v. Hall, (1838) 9 N.H. 441. The infant has been given a hen on cattle for food and service while they were in his possession. Tower-Doyle Com. Co. v. Smith, (1900) 86 Mo. App. 490. Where an infant has received a deed to land, the grantor is entitled to cancellation in equity upon disaffirmance by the infant. McCarty v. Woodstock Iron Co., (1890) 92 Ala. 463. ' Ison V. Cornett, supra. MacGreal v. Taylor, (1896) 167 U.S. 688. * See note 6, preceding page. 186 CAPACITY OF PARTIES [Chap. V sance in the performance of the contract, and must be separate from and independent of it. Thus where an infant hired a mare to ride and injm-ed her by over-riding, it was held that he could not be made liable upon the contract by framing the action in tort for negligence," ^ and an infant who has obtained a loan by falsely representing his age cannot be made to pay the amoimt of the loan in the form of damages in an action for fraudulent mis- representation.* Nor can an infant be made liable for goods sold and delivered by charging him in trover and conversion; ' for though by the Infants' Relief Act contracts for goods supplied to an infant are absolutely void, yet the delivery of goods to hirn with intent to pass the property in them vests the title in the in- fant, in exactly the same manner as a gift of property coupled with delivery vests the title in the donee." The tradesman has, in other words, made a gift of the goods to the infant, though he could not sell them to him. But when an infant hired a horse expressly for riding and not for jumping, and then lent it to a friend who jumped the horse and killed it, he was held liable: for "what was done by the de- fendant was not an abuse of the contract, but was the doing of an act which he was expressly forbidden by the owner to do with the animal." "* ' A butcher boy appropriated some of the meat which he was employed to carry to his master's customers; he sold it and kept the money. He was detected, an account was made of the money due from him, which he acknowledged to be correct, and when he came of age he gave a promissory note for the amount. He was held liable for the amount. It was argued that the Uability a JenningB v. Hundall, (1799) 8 T.R. 335. b Leslie v. Sheill, [1914] 3 KB. 607. c Stocka t. Wilson, [1913] 2 K.B. 235. d Burnard v. Haggis, (1863) 14 C.B. (N.S.) 45. 1 Young V. Muhling, (1900) 48 N.Y. App. Div. 617; Eaton v. HiU, (1870) 50 N.H. 235; Lowery v. Cate, (1901) 108 Tenn. 54. Some states hold an infant liable in tort for deceit if by misrepresenting his age he obtains the property of another. Fitts v. Hall, (1838) 9 N.H. 441; Rice v. Boyer, (1886) 108 Ind. 472. But contra, Slayton v. Barry, (1900) 175 Mass. 513, and cases cited. In no case will misrepresentation as to age estop an infant from dis- affirming his contract. Studwell v. Shapter, (1873) 54 N.Y. 249; Merriam v. Cunningham, (1853, Mass.) 11 Cush. 40; New York Building &c. Co. v. Fisher, (1897) 23 N.Y. App. Div. 363; Quigg v. Quigg, (1903) 42 N.Y. Misc. 48 (marriage); Sims v. Everhardt, (1880) 102 U.S. 300. But see Schmit- heimer v. Eiseman, (1870, Ky.) 7 Bush, 298; Stimson, Am. St. Law, § 6602. " Slayton v. Barry, nipra; Fitts v. Hall, (1838) 9 N.H. 441. ' Eaton V. Hill, mpra; Homer v. Thwing, (1826, Mass.) 3 Pick. 492; Churchill v. White, (1899) 58 Neb. 22; Freeman v. Boland, (1882) 14 R.I. 39. Chap. V] INFANTS 187 arose on an account stated, which was void under § 1, or on a ratification which was unenforceable under § 2. But the court held that he was liable to an action ex delicto, and that his prom- ise to pay when he came of age was the compromise of a suit, for which, being of age, he was competent to contract.^ * But though in the case of the infant who obtains goods or money due to fraudulent misrepresentation as to his true age, no common-law action can for the reasons already given be brought against him for damages for the fraud, the coiui;s of equity never- theless contrived a remedy of their own for the defrauded trades- man or lender. Since the Judicature Acts this remedy, the scope of which seems not to have been fully appreciated in recent years, is now available in all divisions of the High Court, and is thus described in Stocks v. Wilson: * "What the court of equity has done in cases of this kind is to prevent the infant from retaining the benefit of what he has obtained by reason of his fraud. It has done no more than this, and this is a very different thiag from making him liable to pay damages or compensation for the loss of the other party's bargain. K the infant has obtained property by fraud he can be compelled to restore it; if he has obtained money he can be compelled to refund it. If he has not obtained either, but has only purported to bind himself by an obligation to transfer property or to pay money, neither in a court of law nor a court of equity can he be compelled to make good his promise or to make satisfaction of its breach. . . . The cases in which the principle has been applied are (1) cases where the infant by his fraud has obtained possession of prop- erty which he still retained at the time the suit or action was brought, and (2) cases where the infant has obtained money by the fraud. Thus in LemTprike v. Lange" the court held that the lease of a furnished house which an infant had obtained by a fraudulent misrepresentation as to his age must be cancelled and the property given up. The same prin- ciple would no doubt apply to the conveyance of a freehold estate." The remedy in such a case is not a remedy on the contract; it is an equitable remedy for the fraud, and is therefore not affected by the Infants' Relief Act. In the case cited the infant, who had sold part of the goods and pledged the remainder as security for an advance, was held liable to account to the plaintiff for the money which he had thus received and to pay it over to him. a In re Seager, (1889) 60 L.T. 665. 6 11913] 2 K.B. 235, 242, 249. c (1879) 12 Ch. D. 675.* * Cf. ex parte Unity, etc. Ass'n, (1858) 3 De Gex & J. 63; Bennetto i;. Holden, (1874, Ont.) 21 Grant, Ch. 222. ' A note given for a tort was held binding in Ray v. Tubbs, (1878) 50 Vt. 688. But see Hanks v. Deal, (1825, S.C.) 3 McCord, 257. 188 CAPACITY OF PARTIES [Chap. V 3. Corporations 163. Necessary contractual limitations. A corporation is an artificial person created by law. Hence the limitations to the capacity of a corporation for entering into a contract may be di- vided into necessary and express. The very nature of a corpora- tion imposes some necessary restrictions upon its contractual power (e.g., it cannot contract to marry), and the terms of its in- corporation may impose others. A corporation has an existence separate and distinct from that of the individuals who compose it; their corporate rights and habihties are something apart from their individual rights and habilities; they do not of themselves constitute the corpora- tion, but are only its members for the time being. ' Thus a corporation, having this ideal existence apart from its members, is impersonal, and must contract by means of an agent. It " cannot act in its own person, for it has no person." " It follows also that a corporation must give some formal evi- dence of the assent of its members to any legal act which, as a corporation, it may perform. Hence the requirement that a cor- poration must contract under seal.^ The exceptions to this requirement have been dealt with else- where. It should however be noticed that where a corporation either expressly, or by the necessary construction of the terms of its incorporation, has power to make negotiable instruments,' exception is made by the Bills of Exchange Act (1882) * to the general rule that by the law merchant an instrument under seal is not negotiable.* Before this Act a trading corporation whose a Ferguson v. Wilson, (1866) 2 Ch. 89. 6 45 & 46 Vict, o. 61 § 91 (2). ' For example, a deed of corporate lands executed by all the members of the corporation would not convey the corporate title. Wheelock v. Moulton, (1843) 15 Vt. 519. If one person acquires all the stock, the corpo- ration is still a distinct legal entity. Randall v. Dudley, (1897) 111 Mich. 437; Harrington v. Connor, (1897) 51 Neb. 214; 19 L.R.A. 684 note. Space cannot be taken here for a criticism of the theory of corporate entity. To the present editor, such an " entity" seems to be merely a work of constructive imagination. However, the law of corporations has been worked out by means of this fiction, and it is still properly usable as a short- hand method of describing the legal relations of the flesh and blood indi- viduals involved. = But see ante, § 91. ' In the United States a corporation has the implied power to make negotiable paper as evidence of any debt which it has authority to con- tract. Moss V. Averell, (1853) 10 N.Y. 449; Comm. v. Pittsburgh, (1861) 41 Pa. 278; Rockwell v. Elkhom Bk., (1861) 13 Wis. 653; Auerbach v. Le Sueur Mill Co., (1881) 28 Minn. 291. * A negotiable instrument executed by a corporation under seal is not Chap. V] COKPORATIONS 189 business it might be "to make such instruments could render them valid by the signature of an agent duly appointed, but the vaHdity of a bill or note made under the seal of a corporation was doubtful. 164. Express contractual limitations. The express limitations upon the capacity of corporate bodies must vary in every case by the terms of their incorporation. Much has been and still may be said as to the effect of these terms in limiting the con- tractual powers of corporations, but we cannot here discuss the doctrine of "ultra vires." The question whether the terms of incorporation are the measure of the contracting powers of the corporation, or whether they are merely prohibitory of contracts which are inconsistent with them, was discussed at length in the much litigated case of the Ashbury Carriage Company v. Riche ; " and the results of this and other cases point to a distinction be- tween two kinds of corporations. A common-law corporation, that is, a corporation created by charter, in virtue of the royal prerogative, can deal with its property, or bind itself by contract hke an ordinary person, sub- ject always to such special directions given in the charter as might make certain contracts inconsistent with the objects of its creation.* ^ But a corporation created by or in piu-suance of statute is lim- ited to the exercise of such powers as are actually conferred, or may reasonably be deduced from the language of the statute." And thus a company incorporated under the Companies Acts is boimd by the terms of its memorandum of association to make no contracts inconsistent with, or foreign to, the objects set forth in the memorandum.** * a (1875) L.R. 7 H.L. 653. b See Baroness Wenlock v. River Dee Co., (1883) 36 Ch. at p. 685, note. c Osborne v. Amalgamated Soc. of Ry. Servants, [1910] A.C. 87. d Ashbury Carriage Co. v. Riche, (1875) L.R. 7 H.L. 653. thereby rendered non-negotiable unless such was the intent of the corpora- tion in aflSxing the seal. Therefore unless the instrument itself contains a recital as to the seal, or it is shown by extrinsic evidence that the seal was aflBxed by authority for the purpose of creating a specialty, the nego- tiable character of the instrument is not affected. Bank v. Railroad Co., (1873) 5 S.C. 156; Mackay v. Saint Mary's Church, (1885) 15 R.I. 121; Jones V. Homer, (1869) 60 Pa. 214; Chase N.B. v. Faurot, (1896) 149 N.Y. 632. See also American Neg. Inst. Law, § 6 (N.Y. § 25). * In the United States corporations are created only by the legislature. Stowe V. Flagg, (1874) 72 111. 397; Atkinson v. Raiboad Co., (1864) 15 Ohio St. 21. " "In respect of the power of corporations to make contracts, two propo- sitions may be stated: (1) That they have, by mere implication of law and 190 CAPACITY OF PARTIES [Chap. V The Companies (Consolidation) Act, 1908," enables such a company to alter its memorandum under certain conditions and for certain objects, e.g., the furtherance of its business, the addi- tion of cognate business or the abandonment of some of its origi- nal objects. 165. Ultra vires contracts. A contract made ultra vires is void; but not on the ground of illegality. Lord Cairns in the case last above cited takes exception to the use of the term "illegal- ity," pointing out that it is not the object of the contracting par- ties, but the incapacity of one of them, that avoids the contract.' 4. Lunatics and drunken persons z66. Lunatics' contracts. The contract of a lunatic is binding upon him miless it can be shown that at the time of making the contract he was wholly incapable of understanding what he was doing and that the other party knew of his condition. "When a person enters into a contract and afterwards alleges that he was so insane at the time that he did not know what he was doing and proves the allegation, the contract is as binding upon him in every respect, whether it is executory or executed, as if he had been sane when he made it, unless he can prove further that the person with whom he contracted knew him to be so insane as not to be capable of understand- ing what he was about." * A lunatic, even though he has been found insane by inquisi- tion," is not on that account incapable of contracting: the valid- a 8 Edw. VII, o. 69. b Imperial Loan Co. v. Stone, [1892] 1 Q.B. 601. c Conunissions de lunatico inquirendo are no longer issued specially in each case of alleged insanity. A general commission is now, by 53 & 54 Vict. c. 5, issued from time to time, under the Great Seal, to Masters in Lunacy appointed by that Act, who conduct an inquiry in each case in a manner prescribed by the Act. without any affirmative expression to that effect in their charters or govern- ing statutes, and of course in the absence of express prohibitions, the same power to make contracts, within the scope of the purposes of their creation, which natural persons have; (2) That this power, on the other hand, is restricted to the purposes for which the corporation has been created, and cannot be lawfully exercised by it for other purposes." 4 Thompson on Corp., § 564S, and cases there cited. See also Thomas v. Railroad Co., (1879) 101 U.S. 71. 1 In the United States if either party has had the benefits of a contract ultra vires, an action will lie in favor of the other party. The better view is that this liability is quasi-contractual, and that the suit is for benefits con- ferred, and not on the original contract. Central Trans. Co. v. Pullman Car Co., (1890) 139 U.S. 24; (1897) 171 U.S. 138; Bath Gas Light Co. v. Claffy, (1896) 151 N.Y. 24; Brunswick Gas Light Co. v. United Gas Fuel & Light Co., (1893) 85 Me. 532; Slater Woollen Co. v. Lamb, (1887) 143 Mass. 420. Some courts put the decision on the ground of equitable estoppel. Denver Fire Ins. Co. v. McClelland, (1885) 9 Colo. 11. But if nothing has been received by the corporation it may set up that the contract is vUra vires. Jemison v. Bank, (1890) 122 N.Y. 135; Davis v. Railroad Co., (1881) 131 Mass. 258. Chap. V] ; LUNATICS AND DRUNKEN PERSONS 191 ity of the contract depends on the knowledge which the other party may be shown, or reasonably supposed, to have possessed of the state of mind of the insane person." ^ But it seems that a lunatic so found by inquisition cannot, even during a lucid inter- val, execute a valid deed which disposes of property.* 167. Intoxicated persons' contracts. A person who makes a contract while in a state of intoxication may subsequently avoid the contract, but if it is confirmed by him it is binding on him. A man, while dnmk, agreed at an auction to make a purchase of houses and land. Afterwards, when sober, he affirmed the con- tract, and then repented of his bargain, and when sued on the contract pleaded that he was drunk at the time he made it. But the court held that although he had once had an option in the matter and might have avoided the contract, he was now bound by his affirmation of it. "I think," said Martin, B., "that a dnmken man, when he recovers his senses, might insist on the fulfillment of his bargain, and therefore that he can ratify it so as to bind himself to a performance of it." " ^ a HaU V. Warren, (1804) 9 Vea. 605. 6 Re Walker, [1905] 1 Ch. 150. c Matthews v. Baxter, (1873) L.R. 8 Ex. 132. » The American cases are in great confusion. The following propositions may be regarded as fairly sustained by the weight of authority: (1) Where the sane person does not know of the other person's insanity, and there has been no judicial determination of such insanity, and the contract is so far executed that the parties cannot be put in statu quo, the contract is binding upon the lunatic. Gribben v. Maxwell, (1885) 34 Eans. 8; Young v. Stev- ens, (1868) 48 N.H. 133; Brodrib v. Brodrib, (1880) 56 Cal. 663; Copenrath V. Kienby, (1882) 83 Ind. 18; Bokemper v. Hazen, (1895) 96 Iowa, 221; Schaps 0. Lehner, (1893) 54 Minn. 208; Hosier v. Beard, (1896) 54 Ohio St. 398; Insurance Co. v. Hunt, (1880) 79 N.Y. 541. (2) The contract is void- able if the sane person knew of the other's insanity; Crawford v. Scovell, (1880) 94 Pa. 48; or void if the insanity has been judicially declared; Wads- worth V. Shaipsteen, (1853) 8 N.Y. 388; Carter v. Beckwith, (1891) 128 N.Y. 312. (3) Some courts hold a lunatic's deed absolutely void. Wilkinson v. Wilkinson, (1900) 129 Ala. 279; Brigham v. Fayerweather, (1887) 144 Mass. 48. But the weight of authority is otherwise. Bhnn ». Schwarz, (1904) 177 N.Y. 252; Luhrs v. Hancock, (1901) 181 U.S. 567; Boyer v. Benyman, (1889) 123 Ind. 451; Harrison v. Otley, (1897) 101 Iowa, 652. Gribben v. Maxwell, supra. So also a lunatic's power of attorney has been held to be void. Dexter v. Hall, (1872, U.S.) 16 Wall. 9; but see Williams v. Sapieha, (1901) 94 Tex. 430. K the lunatic becomes sane, he may ratify or disaflBrm all void- able contracts; Arnold v. Richmond Iron Works, (1854, Mass.) 1 Gray, 434; but he may be required to return the consideration. Boyer v. Berryman, (1889) 123 Ind. 451; McKenzie ». Donnell, (1899) 151 Mo. 431. The sane person cannot avoid the contract. Atwell v. Jenkins, (1895) 163 Mass. 362. « Barrett v. Buxton, (1826, Vt.) 2 Aik. 167; Reinskopf v. Rogge, (1871) 37 Ind. 207; Joest v. Williams, (1873) 42 Ind. 565; Chicago &c. Ry. v. Lewis, (1884) 109 HI. 120; Van Wyck ». Brasher, (1880) 81 N.Y. 260; Bush v. Breinig, (1886) 113 Pa. 310; Carpenter v. Rodgers, (1886) 61 Mich. 384; Bursinger v. Bank, (1886) 67 Wis. 75. 192 CAPACITY OF PARTIES [Chap. V i68. Equity rules. The rules of equity are in accordance with those of common law in this respect. Under such circum- stances as we have described, courts of equity will decree specific performance against a Itmatic or a person who entered into a contract when intoxicated, and will on similar grounds refuse to set aside their contracts. 169. Necessaries. By the Sale of Goods Act, 1893," a lunatic or a drunkard is liable quasi ex contractu for necessaries sold and delivered, if by reason of mental incapacity or drunkenness he is incapable of contracting.^ ^ 5. Married women 170. Contracts void at common law. Until the 1st of Janu- ary, 1883, it was true to state that, as a general rtile, the con- tract of a married woman was void.^ 171. Exceptions. Yet there were exceptions to this ride: in some cases a married woman could make a valid contract, but could not sue or be sued apart from her husband; in others she could sue but could not be sued alone; in others she could both sue and be sued alone. (1) A married woman might acquire contractual rights by reason of personal services rendered by her, or of the assignment to her of a chose in action. In such cases the husband might "re- duce into possession" rights of this nature accruing to his wife, but unless he did this by some act indicating an intention to deal with them as his, they did not pass, like other personalty of the wife, into the estate of the husband. They survived to the wife if she outlived her husband, or passed to her representatives if she died in his lifetime." * (2) The wife of the king of England "is of capacity to grant 3 56 & 57 Vict. 0. 71, § 2. b Be J., (1909) 21 Cox, 766. c Brashford v. Buckingham and wife, (1608) Cro. Jao. 77; Dalton v. Mid. Coun. B,. Co., (1853) 13 C.B. 478. 1 Sceva V. True, (1873) 53 N.H. 627; McCormick v. Littler, (1877) 85 lU. 62; Kendall v. May, (1865, Mass.) 10 Allen, 59; Sawyer v. Lufkin, (1868) 56 Me. 308; Hosier v. Beard, (1896) 54 Ohio St. 398; Carter v. Beckwith, (1891) 128 N.Y. 312. * Subject to some of the exceptions indicated below, all contracts of mar- ried women in this country are absolutely void in the absence of statutory modifications. Flesh v. Lindsay, (1892) 115 Mo. 1; Bank v. Partee, (1878) 99 U.S. 325; Fuller ». Bartlett, (1856) 41 Me. 241; Parker w. Lambert, (1857) 31 Ala. 89; 2 L.R.A. 345, note. See for statutory changes, § 175, post. ' Miller v. Miller, (1829, Ky.) 1 J.J. Marsh. 169; Hayward v. Hayward, (1838, Mass.) 20 Pick. 517; Borst v. Spehnan, (1850) 4 N.Y. 284; Stande- ford V. Devol, (1863) 21 Ind. 404. Chap. V] MARRIED WOMEN 193 and to take, sue and be sued as a /erne sole, at the common law."" (3) The wife of a man dviliter mortuus^^ had similar rights. (4) The custom of the City of London enabled a married woman to trade, and for that purpose to make valid contracts. She could not sue or be sued upon these (except in the city coxui,s) unless her husband was joined with her as a party, but she did not thereby involve him in her trading liabilities.* (5) A group of exceptions to the general rule was created by the Divorce and Matrimonial Causes Act." ' A woman divorced from her husband is restored to the posi- tion of a /erne sole. Judicial separation, while it lasts, causes the wife "to be con- sidered as a feme sole for the purpose of contract, and wrongs and injuries, and suing and being sued in any judicial proceeding." * §§ 25, 26. And a wife deserted by her husband, and having obtained a protection order from a magistrate or from the court, is " in the hke position with regard to property and contracts, and suing and being sued, as she would be under this act if she had ob- tained a judicial separation." § 21. (6) Akin to the last exception, though not resting upon stat- ute, is the capacity of a married woman to make a contract with her husband that they should live apart, and to compromise proceedings commenced or threatened in the Divorce Coiui;. For all contracts incident to such a transaction the wife is placed in the position of a feme sole.^ ^ 172. Separate estate in equity. The separate estate of a mar- ried woman has in various degrees, in equity and by statute, been treated as a property in respect of which and to the extent of which she can make contracts. o Co. IJtt. 133a. ' h Civil death arises from outlawry; it seems doubtful whether there are any other circum- stances to which the phrase is now apphcable. c (1857) 20 & 21 Vict. c. 85. d McGregor ». McGregor, (1888) 21 Q.B.D. 424. ' See § 155, ante; Metcalf on Cont., pp. 83, 84; Stimson, Am. St. Law, §§ 2513, 6353. ' This custom was not adopted in the United States outside of South Carolina. See NetterviUe v. Barber, (1876) 52 Miss. 168. For statutes regu- lating trading contracts, see Stimson, Am. St. Law, §§ 6520-23. 8 See Stimson, Am. St. Law, §§ 6240-54, 6306-09, .6352-69. * Dean v. Richmond, (1827, Mass.) 5 Pick. 461; Barker v. Mann, (1842, Mass.) 4 Met. 302. 6 Dutton V. Dutton, (1868) 30 Ind. 452; Thomas ». Brown, (1859) 10 Ohio St. 247; King v. Mollohan, (1900) 61 Kans. 683; Hungerford v. Hungerford, (1900) 161 N.Y. 550; 60 L.R.A. 406, note. 194 CAPACITY OF PAETIES [Chap. V The doctrine arose in the chancery. Property, real and per- sonal, might be held in trust for the separate use of a married woman independent of her husband. Sometimes this property was settled on her with a "restraint upon anticipation": in such a case she could use the income, but could neither touch the corpiis of the property, nor create futiu-e rights over the income. But where it was not so restrained, then to the extent of the rights and interests created, a married woman was treated by courts of equity as having power to alienate and contract." ' But she coidd not sue or be sued alone in respect of such es- tate, nor could she bind by contract any but the estate of which she was in actual possession or control at the time the liabihties accrued.* 173. Separate estate by statute. The Married Women's Property Acts of 1870 and 1874° specified various forms of property as the separate estate of married women, enabled them to sue for such property and gave them all remedies, civil and criminal, for its protection that an unmarried woman would have had under the circumstances. Under this act a married woman might make a contract for the exercise of her personal skill or labor, and maintain an action upon it in her own name. Thus was constituted a new legal separate estate, not vested in trustees, and in respect of which a married woman could sue apart from her husband. But this estate was limited in charac- ter, and the married woman could not defend alone any ac- tion brought concerning it: it was necessary that her husband should be joined as a party ."* ^ a Johnson c. Gallagher, (1861) 3 D.F. & J. 491. b Pike V. FitzGibbon, (1881) 17 Ch. D. 454. c 33 & 34 Vict. c. 93^ 37 & 38 Viot. o. 50. d Hancocks v. Lablache, (1878) 3 C.P.D. 197. > Nix V. Bradley, (1853, S.C.) 6 Rich. Eq. 43; Jaques v. Methodist Church, (1820, N.Y.) 17 Johns. 548; Kantrowitz ». Prather, (1869) 31 Ind. 92. ' Married Women's Proi)erty Acts, securing to a wife her separate estate, are found in practicpJly all the American states. The earliest is believed to be that of Mississippi in 1839; but the most effective and most widely copied was that of New York passed in 1848 (now found as amended in N.Y. Domestic Relations Law, § 20 et seg.). In many states conveyances directly from wife to husband or husband to wife are authorized. (Ibid. § 26.) See Wells V. Caywood, (1877) 3 Colo. 487. These statutes also authorize con- tracts by the wife concerning her separate estate. Under the New York Married Women's Property Acts the conclusion was reached by successive decisions that a married woman's contracts could be enforced against her separate estate in three cases: (1) when created in or about carrying on a trade or business of the wife; (2) when relating to or made for the benefit of her separate estate; (3) when the intention to Chap. V] MARRIED WOMEN I95 174. Present English statutory law. The Married Women's Property Act of 1882" repeals the Acts of 1870 and 1874, except as regards all rights acquired or acts done while those statutes were in force. It affects: (1) Every woman married after January 1st, 1883. (2) Every woman married before January 1st, 1883, as respects property and choses in action acquired after that date. We may summarize its effect, so far as it relates to our present pur- pose, as follows: All property, real and personal, in possession, reversion or remainder, vested or contingent, held by a woman before, or acquired after mar- riage, is now her separate property. She can acquire, hold, and dispose of it by will or otherwise, "as her separate property in the same manner as if she were a feme soh without the intervention of any trustee." "In respect of and to the extent of her separate property" a married woman may enter into contracts, and render herself liable thereupon, as though she were a feme soh, and on such contracts she may sue and be sued alone. By the Married Women's Property Act, 1893, ^ every contract now made by a married woman otherwise than as agent, binds her separate estate, and binds separate estate acquired after the contract was made though she possessed none at the time of making the contract. The last enactment extends in two ways the operation of the Act of 1882. (1) Under that act the court might draw inferences as to the intention of a married woman to bind or not to bind her separate estate. " Since 1893 the existence of an intention to bind such estate ia presumed and cannot be negatived. (2) The Act of 1882 has been inter- preted to mean that the power of a married woman to bind her separate estate depended on the existence of such estate at the date of the con- tract.** The amending act, as regards all contracts made after December 5, 1893, binds separate estate when acquired, whether or no the married woman possessed any at the date of the contract. But these contracts must have been made since the passing of the Act: an acknowledgment of a pre-existing debt on which a married woman could not have been sued before the act is not a contract within the meaning of the Act.* The effect of the words "otherwise than as agent " was considered in the case of Paguin v. Beauderk/ where it was held that a married woman who has in fact authority from her husband to deal with trades- men as his agent, does not bind her separate estate, present or after- acquired, even though the fact of her agency is wholly unknown to the tradesman with whom she deals. a 45 & 46 Vict. c. 75. 6 68 & 57 Vict. c. 63. c Leak e. DrifSdd, (1889) 24 Q.B.D. 98. d PalliBer v. Gumey, (1887) 19 Q.B.D. 619. e In re Wheeler, [1904] 2 Ch. 70. / [1906] A.C. 148. charge the separate estate was expressed in the instrument or contract by which the liabiUty was created. Manhattan Brass &c. Co. v. Thompson, (1874) 58 N.Y. 80. If she had no separate estate or was not carrying on a separate business, she could not contract. Linderman v. Farquharson, (1886) 101 N.Y. 434. But later legislation has empowered her to contract for all purposes as fully as an unmarried woman; see § 176, post. 196 CAPACITY OF PAETIES [Chap. V The extended liability imposed by the Act of 1893 does not affect separate estate which a married woman is restrained from anticipating. Where property is settled upon a married woman in trust, and subject to a restraint on anticipation, such property is not then free, and she cannot make it liable, in advance, for the satisfaction of her contracts. Thus, if a judgment is recovered against a married woman who has separate estate which is not free, such a judgment can only affect so much of the estate as is actually in her hands at the time, or income from it which is due and in arrear at the date of the judgment. It can- not affect income from such property accruing and coming into her hands after the date of the judgment." The restraint cannot be removed by a statement made in good faith, or otherwise, that it is' withdrawn. And the words in the Act of 1893 which protect such property "at the time of making the contract or thereafter" extend the protection after coverture has ceased.' But an unmarried woman possessed of property and debts, cannot upon marriage evade her debts by settling her property upon herself without power of anticipation. Property owned before marriage is liable to debts contracted before marriage, however the property may be settled upon marriage. " On the same principle, where debts are incurred by a married woman on the faith of her free separate estate, they bind her estate when cover- ture has ceased by reason of widowhood or dissolution of marriage. But the liability to which a married woman can thus subject herself is not a personal liability. It cannot come into existence unless there is separate estate, and it does not extend beyond the separate estate. Thus where a joint judgment is given against husband and wife, it is to be given against the husband personally, and against the wife as to her separate property. And again, a married woman cannot (unless carrying on a trade or business)'' be made a bankrupt or committed to prison under § 5 of the Debtors' Act, 1869,* for non-payment of a sum for which judgment has been given against her, under § 1, sub-s. 2 of the Act of 1882. The Debtors' Act relates to persons from whom a debt is due, and damages or costs recovered against a married woman do not constitute a debt due from her, but "shall be payable out of her sepa- rate estate, and not otherwise." ■^ Beyond this a judgment against a married woman is precisely the same as a judgment against an unmarried woman." " The judgment is against her: "the fact that execution is limited to her separate property does not make it any the less a judgment against her." * Thus the Acts of 1882 and 1893 increase in two ways the power of contracting possessed by a married woman. Marriage no longer involves any proprietary disability. All the prop- o Hood-Barrs s. Heriot, [1896] A.C. 174; Bolitho v. Gidley, [1905] A.C. 98. b Bateman ». Faber, [1898] 1 Ch. (C.A.) 144; Brown v. Dimbleby, [1904] 1 K.B. 28. c Jay V. Robinson, (1890) 25 Q.B.D. 467. d A married woman carrying on a trade or business, whether separately from her hus- band or not, is now expressly made subject to the bankruptcy laws as if she were a feme sole, by § 125 of the Bankruptcy Act, 1914 (4 & 5 Geo. V, c. 59). c 32 & 33 Vict. c. 62. / Scott ». Morley, (1887) 20 Q.B.D. 120. g Holtby v. Hodgson, (1889) 24 Q.B.D. 109. A Pelton V. Harrison, [1892] 1 Q.B. 121. Chap. V] MARRIED WOMEN 197 erty which a woman owns when she marries remains hers, and all property which she may subsequently acquire becomes hers, unless it is placed in the hands of trustees with a restraint upon anticipation. The area of separate estate is immensely extended, and therewith the contractual capacity of the woman. Full effect is given to this exten- sion by the provision in the act that future as well as existing separate estate is rendered liable to satisfy the contract. And the rights and liabilities thus increased are rendered more easy of enforcement by the provision which enables the married woman to sue and be sued alone. [AMERICAN note] 175. Married women's contracts under American statutes. In the following states a married woman may contract as if unmar- ried, subject to specified exceptions in some of the states (for example, she may not become a surety for her husband in some states or at all in others, in several she may not sell or mortgage her real property without her husband's consent, in a few she may not contract with her husband). Ala. Code, (1907) c. 95; Ariz. R.S., (1913) § 3852; Ark. St., (Kirby, 1904) c. 108; Cal. Civ. Code, (1909) §§ 158, 1556; Colo. Annot. St., (Mills, 1912) § 4759; Conn. Gen. St., (1902) § 4545; Ga. Code, (1911) §§ 3007, 3011; lU. R.S., (1911) p. 1284, § 6; Ind. R.S., (Burns, 1914) c. 86; Iowa Code, (1897) § 3164; Ky. St., (1915) § 2128; Me. Rev. St., (1903) ch. 63, § 4, and see 96 Me. 533; Md. Ann. Code, (1911) Art. 45, § 5; Mass. Rev. Laws, (1902) c. 153, § 2; Mich. Pub. Acts, (1917) p. 287; Minn. Rev. Laws, (1909) § 3607; Miss. Annot. Code, (1917) § 2051 ; Mo. R.S., (1909) § 8304; Mont. Civil Code, (1907) § 3736; NewHamp. Pub. St., (1901) c. 176, § 2; N.J. Comp. St., (1911) p. 3226, § 5; N.Y. Cons. Laws, (1909), Dom. Rel. L. § 51; N.Dak. Rev. Codes, (1913) § 4411; Ohio Gen. Code, (1910) § 7999; Ore. Laws, (Lord, 1910) § 7049; R.I. Gen. Laws, (1909) c. 246; S.Car. Civ. Code, (1912) § 3761; S.Dak. Comp. Laws, (1908) Civ. Code, §§ 98, 105; Utah Comp. Laws, (1907) § 1199; Vt. Gen. Laws, (1917) § 3521; Va. Code, (1904) § 2286a; Wash. Annot. Codes & St., (Rem. & Bal., 1910) § 5927; Wyo. Comp. St., (1910) § 3909. In Florida a married woman may obtain a decree in chancery to remove her disabilities. R.S. (1906) §§ 1955-1958 (and see 19 Fla. 175). In Louisiana her legal incapacity may be removed either by her husband or by a court. Civil Code, § 1786. In the following states a married woman may contract with respect to property as if single, and these statutes have been so construed as to remove most common-law disabilities except as expressly retained. Idaho Rev. Codes, (1908) §§ 2677, 2685; Nev. Comp. Laws, (1912) § 2173; New Mex. St., (1915) § 2750; Okla. R.L. (1910) § 3353; Penn. Pepper & Lewis Dig., pp. 2887-2890, §§ 1, 2, or L. 1893, No. 284, Pur- don's Dig., (1903) p. 2451, L. 1915, No. 279. In the following states a married woman may contract as to her sepa- rate estate or in a trade or business. Kans. Gen. St., (1901) c. 62; Neb. Comp. St., (1905) §§4291, 429.3; Tenn. Code, (Shannon's Supp., 1903) 198 CAPACITY OF PARTIES [Chap. V § 4241, and L. 1897, c. 82; W.Va. Code, (1906) c. 66, §§ 12, 13; Wis. St., (1911) c. 108. In North Carolina she may do so with the consent of her husband. Rev. of 1905, §§ 2094, 2112, 2113. In the following states a married woman may contract as to her sepa- rate estate. Del. Rev. Code (1893 )c. 550, § 4; Tex. Rev. Civ. St., (1911) Tit. 68, c. 3. For cases on the conflict of laws arising under such statutes, see 57 L.R.A. 513, note, and 85 Am. St. Rep. 552, note. CHAPTER VI Mistake, Misrepresentation, Fraud, and Duress 176. Collateral operative facts affecting contract. The next feature in the formation of contract which has to be considered is genuineness or reality of consent; ^ and here the same question recurs in various forms: Given an apparent agreement, possess- ing the element of form or consideration, and made between parties capable of contracting, was the consent of both or either given under such circumstances as to make it no real expression of intention? This question may have to be answered in the affirmative for any one of the following reasons. (i) The parties may not have meant the same thing; or one or both may, while meaning the same thing, have formed untrue conclusions as to the subject-matter of the agreement. This is mistake. (ii) One of the parties may have been led to form untrue con- clusions respecting the subject-matter of the contract by state- ments innocently made, or facts innocently withheld by the other. This is innocent misrepresentation. (iii) These imtrue conclusions may have been induced by representations of the other party made with a knowledge of their untruth and with the intention of deceiving. This is wilful misrepresentation or fraud. (iv) The consent of one of the parties may have been ex- torted from him by the other by actual or threatened personal violence. This is dm-ess. (v) Circumstances may render one of the parties morally in- capable of resisting the will of the other, so that his consent is no real expression of intention. This is undue influence. * The consent is none the less "genuine" and "real," even though it be induced by fraud, mistake, or duress. Consent may be induced by a mis- taken hope of gain or a mistaken estimate of value or by the lie of a third person, and yet there is a contract and we do not doubt the "reality of the consent." Fraud, mistake, and duress are merely collateral operative facts that co-exist with the expressions of consent and have a very important eSect upon the resulting legal relations. 200 THE FORMATION OF CONTRACT [Chap. VI I, MISTAKE 177. Cases excluded from mistake. The confusion which at- tends all discussions on mistake makes it important to strike off at once all topics which, though superficially connected with the subject, are not relevant to mistake as invalidating a contract. 1. Mistake of expression. First, then, we must strike off cases where the parties are genuinely agreed, though the terms em- ployed in making their agreement do not convey their true meaning. In such cases they are permitted to explain, or the courts are willing to correct their error; but this is mistake of expression, and concerns the interpretation, not the formation of contract.^ 2. Want of muhudity. Next, we must strike off all cases in which there was never the outward semblance of agreement because offer and acceptance never agreed in terms.^ 3. False statement, etc. Thirdly, we must strike off all cases in which the assent of one party has been influenced by a false statement, innocent or fraudulent, made by the other; by vio- lence, or by oppression on the part of the other.' 4. Failure of consideration. Lastly, we must strike off all cases in which a man is disappointed in his power to perform his con- tract, or in the performance of it by the other. This last topic relates to the performance of contract, and woiild not be men- tioned here, but for a practice, common even to learned and acute writers, of confusing mistake and failure of consideration. If a man alleges that a contract to which he was a party has not been performed as he expected, or has altogether failed of per- formance, the question is not whether he made a contract (for he has clearly done so), but whether the terms of the contract justify his contention. A man who knows with whom he is deal- ' Equitable remedies for mistake can better be treated in a work devoted specifically to equity jurisdiction. A similar statement can be made as to quasi-contractual remedies. See Bispham, Prino. of Eq. §§468-70; 2 Ames' Cases in Eq. Juris, p. 178 et seq. " Rovegno v. Defferari, (1871) 40 Cal. 459; Rupley v. Daggett, (1874) 74 111. 351; Rowland v. New York &c. R., (1891) 61 Conn. 103; Greene ». Bateman, (1846) 10 Fed. Cas. 1126. Where one party has so negligently expressed himself as to lead the other reasonably to believe that a certain meaning is intended and the other assents thereto, there is a valid contract. It is immaterial whether the one now asserting the non-existence of a contract does so in good faith or not. See §§6, 31, and notes. » See Misrepresentation, Fraud, Duress, Undue Influence, post. Chap. VI] MISTAKE 201 ing, and the nature of the contract which he wants to make, has only himself to blame if the terms of the contract do not bind the other party to carry out the agreement, or pay damages for default. And though the terms may not express what he in- tended them to express, his failure to find words appropriate to his meaning is not mistake; if it were so, a contract would be no more than a rough draft of the intention of the parties, to be ex- plained by the light of subsequent events, and corrected by the court and jury. We must assxmie that the terms of the contract correspond to the intention of the parties. If perf oimance does not correspond to the terms of the contract, or if the subject-matter of the con- tract, or the conditions under which it has to be performed, are not such as the parties contemplated, still we cannot say that the rights of the parties are affected by mistake. Every honest man, making a contract, expects that he and the other party will be able to perform and will perform his imdertaking. The disap- pointment of such expectations caimot be called mistake, other- wise mistake would underlie every breach of contract which the parties had not deliberately intended to break when they made it.^ 178. Cases of operative mistake. The cases in which mistake affects contract are the rare exceptions to an almost universal rule that a man is bound by an agreement to which he has ex- pressed a clear assent, uninfluenced by falsehood, violence, or oppression. If he exhibits all the outward signs of agreement the law will hold that he has agreed." It will be found that where mistake is allowed to invaUdate a contract, the mistake is sometimes brought about by the act of a third party, sometimes by the dishonesty of one of the parties to the contract, and that the cases of genuine mutual mistake are very few. The circumstances under which mistake is operative wovdd thus arise in one of three ways. 1. Act of third party. Two parties are brought into what ap- pear outwardly to be contractual relations by the fraud or negli- gence of a third, inducing one to enter into a transaction which he did not contemplate, or deal with a party unknown or unac- ceptable to him. 2. Dishonesty of one -party. Again, one of two parties allows 1 See the topics; Conditions, Failure of Consideration, Impossibility, in Chapters XIII, XIV, and XV. > See §§ 6, 31, and notes. 202 THE FORMATION OF CONTRACT [Chap. VI the other to enter into an agreement with him, knowing that the other is mistaken as to his identity, or knowing that he attaches one meaning to the terms of the agreement while the other party attaches to them another and different meaning. 3. Mistake of identity or existence of subject. Or lastly, there are cases of genuine mutual mistake where parties contract for a thing which has ceased to exist, or are in error as to the identity of one another or of the subject of the contract. These three forms of mistake may be illustrated, though not amply, from the reports. Beyond these the law will not assist people whose judgment leads them astray, imless their judg- ment was influenced by the fraud or misrepresentation of the other party to the contract. It will be found that the cases which follow fall under one or other of these three heads. (1) Mistake as to terms of the contract and as to the fact of agreement 179. Act of third party. It is hard to suppose that this can arise, except from the falsehood or carelessness of a third party. The courts would not permit one who had entered into a con- tract to avoid its operation on the ground that he did not attend to the terms which were used by himself or the other party, or that he did not read the document containing the contract, or was misinformed as to its contents, or that he supposed it to be a mere form." ^ In like manner one may suppose, though the case has never arisen, that a man who posts a letter of offer or of ac- ceptance, which he had written and addressed, would not be ex- cused from his contract on the ground that he had changed his mind after writing the letter, and had posted it from inadver- tence. The only cases furnished in the reports are cases in which by the fraud of a third party the promisor has been mistaken as to the nature of the contract into which he was entering, and the promisee has in consequence been led to believe in the intention a Hunter v. Walters, (1871) 7 Ch. 84. (Howatson r. Webb, [1907] 1 Ch. 537; [1908] 1 Ch. 1.) > New Yorl£ Central R. Co. v. Beaham, (1916) 37 Sup. Ct. R. 43 (railway ticket plainly setting out terms of contract); Goldstein v. D'Arcy, (1909) 201 IVIass. 312 (defendant wrote, "All you get above $2000 per year you may have as your commission." Plaintiff got a tenant for 5 years at $2200. Held, he was entitled to $1000); Gibbs v. Wallace, (1915) 68 Colo. 364; Frankfort etc., Ins. Co. v. California &c. Co., (Cal. App. 1915) 161 Pac. 176. See ante, § 31} 3 L.R.A. 308; 8 L.R.A. (N.S ) 1140; 32 L.R.A. (N.S.) 429. Chap. VI] MISTAKE 203 of the other party to contract when he did not so intend. In Thoraughgood's Case,'' an illiterate man executed a deed, which was described to him as a release of arrears of rent: in fact it was a release of all claims. The deed was not read to him, but when told that it related to arrears of rent, he said, "If it be no other- wise, I am content," and executed the deed. It was held that the deed was void.^ i8o. Foster v. Mackinnon. In Foster v. Machinnon, Mackin- non, an old man of feeble sight, was induced to indorse a bill of exchange for £3,000, on the assurance that it was a guarantee. Later the bill was indorsed for value to Foster, who sued Mack- innon; the jury foimd that there was no neghgence on the part of Mackinnon, and though Foster was innocent of the fraud, it was held that he could not recover. "It seems plain on principle and on authority that if a blind man, or a man who cannot read, or who for some reason {not implying negligence) forbears to read, has a written contract falsely read over to him, the reader misreading to such a degree that the written contract is of a nature altogether different from the contract pretended to be read from the paper, which the blind or illiterate man afterwards signs; then, at least if there be no negligence, the signature so obtained is of no force. And it is invalid, not merely on the ground of fraud, where fraud exists, but on the ground that the mind of the signer did not accompany the sig- nature; in other words, that he never intended to sign, and therefore in contemplation of law never did sign, the contract to which his name is appended."' * a (1584) 2 Co. Rep. 9. b Foster v. Mackiimon, (1869) L.K. 4 C.F. 711. > Alexander v. Brogley, (1899) 63 N.J. L. 307; Smith v. Smith, (1892) 134 N.Y. 63; Wilcox v. Am. Tel. & Tel. Co., (1903) 176 N.Y. 115; O'Donnell v. Clinton, (1888) 145 Mass. 461; Adolph v. Minneapolis Ey., (1894) 58 Minn. 178; Gross v. Drager, (1886) 66 Wis. 150. But see Chicago &c. Ry. v. Belli- with, (1897) 83 Fed. 437. In cases of this sort both parties believe there is mutual agreement, and in this both are mistaken. The offeree is mistaken as to the terms of the offer; but as to this the offeror is not mistaken at all. The offeror is mistaken as to the intention of the acceptor. Such a mistake prevents the formation of a contract, in the absence of an estoppel due to negligence. See § 31, ante. ' The American cases are generally in accord with this doctrine. Walker V. Ebert, (1871) 29 Wis. 194; Vanbrunt v. Singley, (1877) 85 111. 281; Mitchell V. Tomlinson, (1883) 91 Ind. 167; Green v. Wilkie, (1896) 98 Iowa, 74 and note; Aultman v. Olson, (1886) 34 Minn. 450; Gibbs v. Linabury, (1871) 22 Mich. 479. But see Bank v. Johns, (1883) 22 W.Va. 520, 635. If, however, the signer was negligent, he is liable to a holder in due course of negotiable paper. Chapman v. Rose, (1874) 56 N.Y. 137; Ort v. Fowler, (1884) 31 Kans. 478; Yeagley v. Webb, (1882) 86 Ind. 424. So he may be estopped as to an innocent purchaser of property who has relied upon docu- ments of title. Gavagan v. Bryant, (1876) 83 Ill."376; Terry p. Tuttle, (1872) 24 Mich. 206. The rule applies to cases where one intends to sign a negotiable instru- 204 THE FORMATION OF CONTRACT [Chap. VI i8i. Lewis V. Clay. Lewis v. Clay " was decided on the same grounds as Foster v. Mackinnon. Lewis was the payee of a prom- issory note made jointly by Clay and Lord William Nevill. Clay had been induced to sign his name on a piece of paper, concealed from him by blotting-paper with the exception of the space for his signature. He was told by Nevill that the docimaent con- cerned private affairs, and that his signatiu-e was wanted as a witness. The jury found that he had signed in misplaced confi- dence, but without negligence: and Russell, C.J., setting aside any question which might arise from the character of the instru- ment, or the construction of the Bills of Exchange Act, 1882, held that he was not liable because "his mind never went with the transaction," but was "fraudulently directed into another channel by the statement that he was merely witnessing a deed or other document." 182. Other illustrations. The two cases above cited contain certain features in common. In each case two parties had been brought into contractual relations by the fraud of a third per- son, who had misrepresented the nature of the contract to one of the two parties. In each case the document in question was a negotiable instrument. In each case a jury found that the party deceived had not contributed to his deception by negligence. The subject has been discussed in the Court of Appeal in the later case of the Carlisle Banking Co. v. Bragg} The facts dif- fered from those of the previous cases in two particulars. The doc- imient signed by Bragg was a guarantee on the faith of which the plaintiffs advanced money: and the jury foimd that Bragg was negligent in not detecting the fraud which induced his sig- nature. The court held that negligence would not estop him from de- nying that his mind went with the signature unless it could be shown that he was under some duty to the other party to the contract. Negotiable instruments are treated as exceptions to this rule, for the maker, acceptor, or indorser of a negotiable instrument owes a duty to every subsequent bona fide holder for value, and o (1898) 2 L.J. Q.B. 224; 77 L.T. 653. b (1911] 1 K.B. 489. ment, but not for the amount or in the terms actually written. Burroughs ti. Pac. Guano Co., (1886) 81 Ala. 265; Auten v. Gruner, (1878) 90 111. 300; Green v. Wilkie, svpra; Aultman v. Olson, supra; But negligence might be more easily inferred in such a case. Yeagley v. Webb, supra; Fayette Co. Bank v. Steffes, (1880) 54 Iowa, 214. Chap. VI] MISTAKE 205 is liable on the instrument unless he can show not merely that his mind did not go with his signature but that no negligence on his part contributed to his mistake. ^ It might be thought reason- able that, if one of two innocent parties is to suffer for the fraud of a third, the sufferer should be the one whose negUgence has contributed to the loss sustained. This however seems not to be the view of the Court of Appeal." The same question may arise where the act of the third party is merely officious or careless. It has been held that a man is not bound by an offer wrongly transmitted by a telegraph clerk and accepted by the offeree. The post-office had no authority to convey the message except in the form presented to it.* ^ 183. Summary of doctriae. Mistake therefore as to the natiu-e a The decision in Carlisle Banking Co. t. Bragg, [1911] 1 K.B. 4S9, which cannot be regarded as satisfactory, is discussed in an article in 28 L.Q.B. 190.* i> Henkel v. Pape, (1870) L.R. 6 Ex. 7. * This decision thoroughly deserves the drastic criticism given it by Sir William Anson in 28 Law Quarterly Review, 190. '■ There is no reason for treating these as exceptions. A party to a nego- tiable instrmnent owes no contractual duty to a subsequent bona fide holder before he becomes such; and if, in the absence of such a duty, mistake pre- vents the existence of a contract, it would so operate here. See Page v. Krekey, (1893) 137 N.Y. 307. In fact there is a legal duty in all cases, whether of negotiable instruments or of other contracts and conveyances, the duty of not causing damage by negligence. The principles of estoppel apply with special force in the case of negotiable paper, but not in such case exclusively. See ante, § 180, and note. Where A completes and signs a negotiable instrument, but without intending to deliver it, and it is taken from his possession and put into circulation, it has been held that he is liable upon it to a bona fide holder for value. Worcester County Bank v. Dorchester &c. Bank, (1852, Mass.) 10 Cush. 488; Shipley v. Carroll, (1867) 46 111. 285; Gould V. Segee, (1856, N.Y.) 5 Duer, 260; Kinyon v. Wohlford, (1871) 17 Minn. 239; Neg. Inst. Law, § 16 (N.Y. § 35). Contra: Burson v. Huntington, (1870) 21 Mich. 415; Salley v. Terrill, (1901) 95 Me. 553; Salander v. Lock- wood, (1879) 66 Ind. 285 (sembh). But not if the instrument is incomplete. Neg. Inst. Law, § 15 (N.Y. § 34). ' On this point the American cases are in conflict. In accord with the rule laid down above are: Pepper v. Tel. Co., (1889) 87 Tenn. 554; Shingleur V. W.U. Tel. Co., (1895) 72 Miss. 1030; Strong v. W.U. Tel. Co., (1910) 18 Idaho, 389, 30 L.R.A. (N.S.) 409, Ann. Cas. 1912 A, 55. The German CivU Code, §§ 120, 122, follows this rule, but requires an indemnity, perhaps somewhat in the nature of a division of the loss. In conflict with the Eng- lish rule are: Ayer v. W.U. Tel. Co., (1887) 79 Me. 493; W.U. Tel. Co. v. Shotter, (1883) 71 Ga. 760; Haubelt v. Rea, etc. Co., (1898) 77 Mo. App. 672; Sherrerd v. W.U. Tel. Co., (1911) 146 Wis. 197; Durkee v. Vt. Cent. R. Co., (1856) 29 Vt. 127. See also Penobscot Fish Co. v. W.U. Tel. Co., (Conn. 1916) 98 Atl. 341; Postal T. & C. Co. v. Wells, (1903) 82 Miss. 733. If the offeree knew or ought to have known that there was an error, there is no contract. Germain Fruit Co. v. W.U. Tel. Co., (1902) 137 Cal. 598; cf. J. L. Price Brokerage Co. v. Chicago, B. & Q. R.R. Co., (1917, Mo. App.) 199 S.W. 732, and comment in 27 Yale Law Journal, 932. 206 THE FORMATION OF CONTRACT [Chap. VI of the transaction entered into, or as to the intention of the other party to make a contract, must be mutual mistake; the mistake must arise from deceit or mischance which is the work of a third party, but, save in the case of negotiable instnmients, the ques- tion of negligence is immaterial, unless a duty to the other party to the contract can be estabhshed; if these conditions are not ful- filled, the contract, if affected at all, wiU be voidable for fraud or misrepresentation and will not be void on the ground of mis- take at all. (2) Mistake as to the identity of the person with whom the contract is made 184. Mistake as to party. Mistake of this sort can only arise where A contracts with X, beheving him to be M: that is, where the offeror has in contemplation a definite person with whom he intends to contract. It cannot arise in the case of general offers which any one may accept, such as offers by advertisement, or sales for ready money. In such cases the personaUty of the ac- ceptor is plainly a matter of indifference to the offeror." In Boulton v. Jones,'' Boulton had taken over the business of one Brocklehurst, with whom Jones had been used to deal, and against whom he had a set-off. Jones sent an order for goods to Brocklehiu-st, which Boulton suppUed without any notice that the business had changed hands. When Jones learned that the goods had not come from Brocklehurst he refused to pay for them, and it was held that he need not pay. "In order to en- title the plaintiff to recover, he must show that there was a con- tract with himself." ^ a Where the personality of one party may be important to the other the assumption of a false name is fraudulent and makes the contract voidable. In Gordon 0. Street* [1899] 2 Q.B. 641, the defendant was induced to borrow money from Gordon, a money- lender, whose usurious practices were notorious, who on this occasion contracted under the name of Addison. On discovery of the fraud Street was held to be entitled to repudiats the contract. b (1857) 2 H. & N. 564. 1 Accord : Boston Ice Co. i;. Potter, (1877) 123 Mass. 28, with which com- pare Stoddard v. Ham, (1880) 129 Maas. 383. It would seem that if the goods have been consumed in ignorance of the mistake, the consumer is liable to no one. But if he deals with them after notice of the mistake, he becomes liable either in trover after demand or in assumpsit upon an im- plied "ratification" of the substitution of parties. Randolph Iron Co. v. Elliott, (1870) 34 N.J. L. 184; Barnes v. Shoemaker, (1887) 112 Ind. 512. These cases should be carefully distinguished from those where B deals with A, supposing A to be acting for himself, when in fact A is acting for an undisclosed principal, X. In such case, subject to certain qualifications, X may sue or be sued upon the contract. Hubbard v. Tenbrook, (1889) 124 Pa. 291 ; Huntington v. Knox, (1851, Mass.) 7 Cush. 371; Huffcut on Agency, Ch.X. Chap. VI] MISTAKE 207 In Cuvdy v. lAndsay," a person named Blenkarn, by imitating the signature of a respectable firm named Blenkiron, induced A to supply him with goods which he afterwards sold to X. It was held that an innocent purchaser could acquire no right to the goods, because as between A and Blenkarn there was no con- tract. "Of him," says Lord Cairns, "they knew nothing, and of him they never thought. With him they never intended to deal. Their minds never even for an instant of time rested upon him, and as between him and them there was no consensus of mind, which could lead to any agreement or contract whatever. As between him and them there was merely the one side to a con- tract, where in order to produce a contract, two sides would be required." ^ The result of the two cases is no more than this, — that if a man accepts an offer which is plainly meant for another, or if he becomes party to a contract by falsely representing himself to be another,* the contract in either case is void," or, to put it more accurately, no contract ever comes into existence.^ In the first case one party takes advantage of the mistake, in the other he creates it. 185. Cases of mutual error. The reports furnish us with no case of genuine mistake, in which A makes an offer to M behev- ing him to be X, and M accepts, beUeving the offer to be meant for him. a (1878) 3 App. Cas. 459. b There is a mass of authority to the effect that where a man induces another to contract vrith him or to supply him with goods by falsely representing himself to be some one else than he is, or to have an authority which he does not possess, no contract is made, and no property in the goods passes. Hardman v. Booth, (1863) 1 H, & C. 803; Kingsford t. Merry, (1856) 1 H. & N. 803; and Hollins v. Fowler, (1875) L.R. 7 H.L. 757, where all or nearly all the cases bearing on the subject are reviewed. c Baillie's Case, [1898] 1 Ch. 110. 1 Phelps V. McQuade, (1913) 158 N.Y. App. Div. 528. See 14 Columbia Law Review, 85. The same result follows if the seller is induced to contract with £ on his false representation that he is acting as agent for a named person. Barker v. Dinsmore, (1872) 72 Pa. 427; Rodliff v. Dallinger, (1886) 141 Mass. 1; Alexander v. Swackhamer, (1885) 105 Ind. 81; Hentz v. Miller, (1883) 94 N.Y. 64. ^ A distinction has been drawn where the defrauder deals in person with the party he is defrauding, but assumes the name and credit of a third per- son. It is held that in such a case the defrauder gets the legal power to create a perfect legal and equitable title in an innocent purchaiser of the goods obtained by the fraud. The reason given is that the defrauder is personally present and that the defrauded party intends to deal with him. Martin v. Green, (1918, Me.) 102 Atl. 977; Edmunds v. Merchants, etc. Co., (1883) 135 Mass. 283; Samuel v. Cheney, (1883) 135 Mass. 278; but see contra, Pacific Express Co. v. Shearer, (1896) 160 111. 215. 208 THE FOEMATION OF CONTRACT [Chap. VI If in Boulton v. Jones " the plaintiff had succeeded a predeces- sor in business of the same name, he might reasonably have sup- posed that the order for goods was meant for him. If the order had been given to Boulton A, and accepted by Boulton X, it is very doubtful whether Jones could have avoided the contract on the ground that though he obtained the goods he wanted from the man to whom his order was addressed, the Boulton whom he had addressed was not the Boulton whom he intended to address.* Circumstances might indicate to the offeree that the offer was intended for a different person. An offer of marriage falling into the hands of a lady for whom it was not intended, where two ladies chanced to have the same name and address, might or might not be turned into a promise by acceptance, according as the terms of acquaintance, or age of the parties might justify the recipient in supposing that the offer was meant for her. An offer for the purchase of goods might not call for the same nicety of consideration on the part of the offeree. (3) Mistake as to the subject-matter (a) Mistake of identity as to the thing contracted for ^ i86. Mistake of identity. A contract may be void on the ground of mistake, if two things have the same name, and A makes an offer to X referring to one of them, which offer X ac- cepts, thinking that A is referring to the other. If there is nothing in the terms of the contract to identify one or other as its sub- ject-matter, evidence may be given to show that the mind of each party was directed to a different object: that A offered one thing, and X accepted another. In Raffles v. Wichelhaus * the defendant agreed to buy of the plaintiff a cargo of cotton "to arrive ex Peerless from Bombay." There were two ships called Peerless, and both sailed from Bom- bay, but Wichelhaus meant a Peerless which arrived in October, and RafHes meant a Peerless which arrived in December. It was held that there was no contract.'' But if Wichelhaus had meant g (1857) 2 H. & N. 564. b (1864) 2 H. & C. 906. ' If the acceptor knows the offer was intended for his predecessor, there is no contract. Jordan, Marsh & Co. v. Beals, (1909) 201 Mass. 163. ' In this case there was no actual agreement, although there appeared to be one. Further, there was no negligence or other ground for holding that there was a contract by estoppel. See ante, § 31 ; also Kyle ti. Kav- anagh, (1869) 103 Mass. 356; Stong v. Lane, (1896) 66 Minn. 94; Sheldon V. Capron, (1855) 3 R.I. 171; Irwin v. Wilson, (1887) 45 Ohio St. 426; Mead V. Ins. Co., (1893) 158 Mass. 124. C3HAP.VI] MISTAKE 209 a ship of a different name, he would have had to take the conse- quences of his carelessness in not expressing his meaning prop- erly. Nor could he have avoided the contract if its terms had contained such a description of the subject-matter as would practically identify it." (6) Mistake as to the existence of the thing contracted for 187. Subject-matter non-existent. It has been doubted whether this can be regarded as mistake, or whether the parties to every contract do not act on an assumption, or imphed con- dition vital to the contract, that the subject-matter of the con- tract is in existence.' The language of the courts is, however, in favor of treating these cases as cases of mistake. In Couturier v. Hastie," a contract was made for the sale of a cargo of corn, which the parties supposed to be on its voyage from Salonica to England : it had in fact, before the date of sale, become so heated that it was unloaded at Tunis and sold for what it would fetch. The court held that the contract was void, inasmuch as "it plainly imports that there was something to be sold, and something to be purchased, whereas the object of the sale had ceased to exist." ^ In Scott V. Coulsonf a contract for the assignment of a poUcy of life insm-ance was made upon the basis of a belief common to both parties that the assured was aUve. He had, in fact, died be- fore the contract was made. It was held that "there was a com- mon mistake, and therefore the contract was one that cannot be enforced." ^ a lonides 8. Pacific Insurance Co., (1871) L.R. 6 Q.B. 686. i By 56 & 57 Vict. c. 71, § 6 of the Sale of Goods Act auch a condition b implied in every sale of goods. c (1852) 5 H.L.C. 673. d [1903] 2 Ch. (C.A) 249. 1 Gibson v. Pelkie, (1877) 37 Mich. 380; Sherwood v. Walker, (1887) 66 Mich. 568; Kowalke v. Milwaukee &c. Co., (1899) 103 Wis. 472; Allen V. Hammond, (1837, U.S.) 11 Pet. 63; Duncan v. Ins. Co., (1893) 138 N.Y. 88. Mistakes as to extrinsic facts or as to quality will not avoid a contract. Hecht V. Batcheller, (1888) 147 Mass. 335; Wood v. Boynton, (1885) 64 Wis. 265. But there seems to be a class of cases lying midway between mis- takes as to existence and mistakes as to quality, where the mistake is as to the existence of some fundamental quality, the presence or absence of which is regarded by the parties as a material element in the contract: aa the sterility or non-sterility of a cow, Sherwood v. Walker, supra; the pro- ductiveness or non-productiveness of land, Irwin v. Wilson, (1887) 45 Ohio St. 426; Thwing v. Hall &c. Co., (1889) 40 Minn. 184; the denominational value of a coin, Chapman ». Cole, (1858) 12 Gray, 141; the presence of concealed valuables in an article sold, Huthmaoher v. Harris, (1861) 38 Pa. 491. ! Riegel ». Ins. Co., (1893) 153 Pa. 134. But if the contract is made. 210 THE FORMATION OF CONTRACT [Chap. VI Marine insurance policies usually contain the words "lost or not lost" in order to protect the assured against the possibility of this form of mistake. i88. Supposed right non-existent. The same rule applies where parties contract under a mutual belief that a right exists, which in fact is non-existent. If A agrees with X to hire or buy an estate from him which both believe to belong to X, but which is found to belong to A, the contract will not be enforced.' And this is not, as would at first sight appear, an infringement of the maxim "ignorantia juris hand excusat." " "In that maxim," said Lord Westbury, "the vrord jus is used in the sense of denoting general law, the ordinary law of the country. But when the word jus is used in the sense of denoting a private right, that maxim has no application. Private right of ownership is a matter of fact; it may be the result also of matter of law; but if parties contract under a mutual mistake and misapprehension as to their relative and respective rights, the result is that that agreement is liable to be set aside as having proceeded upon a common mistake." ^ ' (c) Mistake by one party as to the intention of the oiher, known ^ to thai other i ; '" 189. General rules. We come here to the limits of operative mistake in regard to the subject-matter of a contract, and must be very careful to define them so as to avoid confusion. A general rule laid down in Freeman v. Cooke," and often cited with approval, may be taken to govern all cases in which one of two parties claims to repudiate a contract on the ground that his meaning was misunderstood, or that he misimderstood that of the other party. a Bingham v. Bingham, (1748) 1 Ves. Sen. 126. b Cooper v. Phibbs, (1867) L.R. 2 H.L. 170. c (1848) 2 Exch. 654. both parties being conscious of their lack of knowledge of the fact, there is no mistake. Such is the case where the parties make a compTomise agree- ment for the settlement of a claim the validity of which depends upon some fact the existence of which is unknown to them. They are ignorant, not mistaken; for their ignorance is conscious ignorance. Sears v. Grand Lodge, (1900) 163 N.Y. 374; Sears v. Leland, (1887) 145 Mass. 277; Wood v. Boynton, (1885) 64 Wis. 265; Kowalke v. MU. Elec. Co., (1899) 103 Wis. 472. See also Hecht v. Batcheller, (1888) 147 Mass. 335. ^ li X warranted title, either there is no mistake (see note 1, supra) or the mistake is immaterial. X will be bound to pay damages for non- performance. ! Martin v. MoCormick, (1854) 8 N.Y. 331; Morgan v. Dod, (1877) 3 Colo. 551; O'Neal v. PhQlips, (1889) 83 Ga. 556. But see McAninch 0. Laughlin, (1850) 13 Pa. 371; Haden v. Ware, (1849) 15 Ala. 149; Leal v. Terbush, (1883) 52 Mich. 100. CJhap. VI] MISTAKE 211 "If whatever a man's real intention may be he so conducts himself that a reasonable man would believe that he was assenting to the terms proposed by the other party, and that other party upon that beUef enters into the contract with him, the man thus conducting himself would be equally bound as if he had intended to agree to the other party's terms." " » As regards the quantity and the price of the subject-matter concerned, a man's statement must usually be taken to be con- clusive against himself. As regards the quality of a thing sold, or the general circum- stances of a contract entered into, a man must use his own judg- ment, or if he cannot rely upon his judgment, must take care that the terms of the contract secure to him what he wants.^ 190. Implied conditions. In two cases the law will protect one of the parties to a contract. Where goods are bought by description, or in reliance on the judgment of a seller who knows the purpose for which they are required, the Sale of Goods Act,' 1893, introduces into the con- tract implied conditions that the goods supplied shall be of a merchantable quality, or reasonably fit for the purpose for which they are required. And where the sale is by sample, there are implied conditions that the bulk shall correspond with the sample, that the buyer shall have an opportunity for inspection, and that there shall be no defect not apparent on reasonable ex- amination which would render the goods unmerchantable.' And again, in certain contracts said to be " vberrimae fidei," in which one of the two parties is necessarily at a disadvantage as to knowledge of the subject-matter of the contract, the law reqtiires the other to disclose every material fact, that is, every fact which might have influenced the mind of a prudent person.* o Smith T. Hughea, (1871) L.R. 8 Q.B. at p. 607. t 67 & BS Vict, e. 71, §§ 14 & 15. » Mansfield v. Hodgdon, (1888) 147 Mass. 304; Phillip v. Gallant, (1875) 62 N.Y. 256; Coates o. Buck, (1896) 93 Wis. 128; Steinmeyer v. Schroeppel, (1907) 226 LI. 9; Grant Marble Co. v. Abbot, (1910) 142 Wis. 279. But see Rowland v. Ry, (1891) 61 Conn. 103. See ante, § 31. ' That caveat emptor is the general rule, see Grigsby v. Stapleton, (1887) 94 Mo. 423; Wolcott v. Mount, (1873) 36 N.J. L. 262; Winsor v. Lombard, (1836) 18 Pick. 57. • The common law implies warranties of title, of correspondence with description, of correspondence with sample, where goods are ordered for a particular purpose of fitness for that purpose, and in some cases of mer- chantability. See Benjamin on Sales, §§ 647-73, and Bennett's Am. Notes. See Wolcott v. Mount, (1873) 36 N.J. L. 262; Coplay Iron Co. v. Pope, (1888) 108 N.Y. 232. • < Walden v. Louisiana Ins. Co., (18S8) 12 La. 134; Grigsby v. Stapleton, (1887) 94 Mo. 423. 212 THE FORMATION OF CONTRACT [Chap. VI 191. Words and acts control. Beyond this, where the terms of a contract are clear, the question is, not what the parties thougM, but what they said and did. Construction of words. Suppose that A sells to X, and X be- lieves that he is buying, a bar of gold: the bar turns out to be brass. The parties are honestly mistaken as to the subject- matter of the contract, both believed the bar to be gold. But their rights are not affected by their state of mind; they depend on the answer to the question — Did A purport to sell to Z a bar of metal, or a bar of gold? A contract for a bar of gold is not performed by the delivery of a bar of brass; but a contract for a bar of metal is performed by the delivery of a bar of metal. It does not matter what the metal may be, nor does it matter what the parties may have thought that it was.* Let the hargainer beware. There are two things which have to be considered by one who is entering into a contract. The first is what he wants the other party to supply, to do, or to forbear: that is, the matter of his bargain. The second is the state- ments, promises, and conditions of which the contract consists: the terms of his bargain. As to these things, and subject to the exceptions which I have mentioned, a contracting party must take care of himself; he caimot expect the other party to correct his judgment as to the matter of his bargain, or ascertain by cross-examination whether he understands its terms. Known mistake as to promise. But the law will not allow a man to make or accept a promise, which he knows that the other party imderstands in a different sense from that in which he understands it himself.* 192. Illustrations. We can best illustrate these propositions by an imaginary sale. A sells X a piece of china. (o) Mistake as to thing. X thinks it is Dresden china, A thinks it is not. Each takes his chance. X may get a better thing than A intended to sell, or a worse thing than he himself intended to buy; in neither case is the validity of the contract affected.* (6) Known mistake as to thing. X thinks it is Dresden china. A knows that X thinks so, and knows that it is not. The contract holds. A must do nothing to deceive X, but he 1 Wood V. Boynton, (1885) 64 Wis. 265. Compare Sherwood v. Walker, (1887) 66 Mich. 568; Chapman v. Cole, (1858, Mass.) 12 Gray, 141. » Cleghom v. Zumwalt, (1890) 83 Cal. 165; Haviland v. Willets, (1894) 141 N.Y. 35. • Wood V. Boynton, swpra. CJhap. VI] MISTAKE 213 is not bound to prevent X from deceiving himself as to the qual- ity of the article sold.' (c) Mistake as to promise. X thinks that it is Dresden china and thinks that A intends to sell it as Dresden china; and A knows it is not Dresden china, but does not know that X thinks that he intends to sell it as Dresden china. The contract says nothing of Dresden, but is for a sale of china in general terms. The contract holds. The misapprehension by X of the extent of A's promise, if unknown to A, has no effect. It is not A's fault that X omitted to introduce terms which he wished to form part of the contract. 2 (d) Known mistake as to promise. X thinks it is Dresden china, and thinks that A intends to sell it as Dresden china. A knows that X thinks he is promising Dresden china, but does not mean to promise more than china in general terms. The contract is void.' X's error was not one of judgment as to the quaUty of the china, as in (6), but regarded the quahty of A's promise, and A, knowing that his promise was misunder- stood, allowed the mistake to continue.^ The last instance given corresponds to the rule laid down in Smith V. Hughes!^ In that case Hughes was sued for refusing to accept some oats which he had agreed to buy of Smith; he alleged that he had intended and agreed to buy old oats, and that those suppUed were new. The Court of Queen's Bench held that to avoid the sale Smith must be proved to have known that Hughes thought he was being promised old oats. Smith might recover if he had known that Hughes thought he was buying old oats; not so if he knew that Hughes thought he was being prom- ised old oats. a (1871) L.R. 6 Q.B. 597. » See Laidlaw v. Organ, (1817, U.S.) 2 Wheat. 178; Peoples' Bank v. Bogart, (1880) 81 N.Y. 101. Cf. Brown v. Montgomery, (1859) 20 N.Y. 287. 2 Wheat V. Cross, (1869) 31 Md. 99. We must consider not merely what A knew, but also what he ought to have known as a man of reasonable prudence. ' In most such cases there would be a contract by estoppel, at least where the understanding of Z as to the terms of the contract was reasonable and was caused by the words or conduct of A. Non-performance by X of the supposed promise would have the same effect as any other breach of contract. * Shelton v. Ellis, (1883) 70 Ga. 297; Haviland v. Willets, (1894) 141 N.Y. 35; Thayer v. Knote, (1898) 59 Kans. 181; Parrish v. Thurston, (1882) 87 Ind. 437; Harran v. Foley, (1885) 62 Wis. 584; Davis v. Reisinger, (1907) 120 N.Y. App. D. 766. These are generally treated as cases of fraud. Stewart v. Wyoming Ranch Co., (1888) 128 U.S. 383. 214 THE FORMATION OF CONTRACT [Chap. VI Blackburn, J., said, "In this case I agree that on the sale of a specific article, unless there be a warranty making it part of the bargain that it possesses some particular quality, the purchaser must take the article he has bought though it does not possess that quality." (This is instance a.) "And I agree that even if the vendor was aware that the purchaser thought that the article possessed that quality, and would not have entered into the contract unless he had so thought, still the purchaser is bound, unless the vendor was guilty of some fraud or deceit upon him, and that a mere abstinence from disabusing the purchaser of that im- pression is not fraud or deceit; for whatever may be the case in a court of morals, there is no legal obligation on the vendor to inform the jmrchaser that he is under a mistake, not induced by the act of the vendor." (This is instance 6.) And Hannen, J., said, "It is essential to the creation of a contract that both parties should agree to the same thing in the same sense. . . . But one of the parties to an apparent contract may, by his own fault, be precluded from setting up that he had entered into it in a different sense to that in which it was understood by the other party. Thus in a case of sale by sample where the vendor, by mistake, exhibited a wrong sample, it was held that the contract was not avoided by this error of the vendor." Scott v. Littledale." (This corresponds to instance c.) And further he says, "If, in the present case, the plaintiff knew that the defendant, in dealing with him for oats, did so on the assumption that the plaintiff was contracting to sell him old oats, he was aware that the defendant apprehended the contract in a different sense to that in which he meant it, and he is thereby deprived of the right to insist that the defendant shall be bound by that which was the apparent, and not the real bargain." (This corresponds to instance d.y Scriven v. Hindley ^ affords a further illustration. The plains tiffs instructed an auctioneer to sell certain bales of hemp and tow, which were described in the catalogue as so many bales in different lots with no indication of the difference in their con- tents. The defendant examined samples of the hemp before the sale, intending to bid for the hemp alone. The tow was put up for sa,le, and the defendant made a bid which was accepted. The bid was a reasonable one if it had been for tow, but an excessive one for hemp. The jury found that the auctioneer intended to sell tow and that the defendant intended to bid for hemp, and that the auctioneer believed that the bid was made under a mis- a (1858) 8E. & B. 818. This case puts, from the seller's point of view, the principle which we have been illustrating from the point of view of the buyer. The seller means to promise one thing; he in fact promises another; the fact that he thinks he is promising something lees than he does promise has no effect on the validity of the sale b [1913] 3 K.B. 664. > The reasoning of this case was adopted in the very curious case of Gill V. M'Dowell, [1903] 2 I.R. 463. The outworn doctrine of caveat emptor caused the court to be very astute 1p find that there was a mistake, known to the defendant, as to the terms of the contract. Chap. VI] MISTAKE 215 take when he accepted it. On these findings it was held that the parties were never ad idem, and judgment was entered for the defendant. \ In Smith v. Hughes the case was sent back for a new trial on the ground that the judge in the court below had not directed the jury with sufficient clearness as to the nature of such mis- take as will enable one party successfully to resist an action brought by the other for non-performance of a contract which is not in its terms ambiguous. 193. Application of rule in equity. But a series of equity cases illustrates the rule that when one man knows that another im- derstands his promise in a different sense from that in which he makes it the transaction will not be allowed to stand. In Wd)skT V. Cecil " specific performance of a contract was re- fused on the ground of mistake of this nature, although it was suggested that damages might be recovered in a common-law court for non-performance. The parties were in treaty for the purchase of some plots of land belonging to Cecil. Webster, through his agent, offered £2000, which was refused. Afterwards Cecil wrote to Webster a letter containing an offer to sell at £1200; he had intended to write £2100, but either cast up the figures wrongly or committed a clerical error. Webster accepted by retinrn of post. Cecil at once tried to correct the error, but Webster, though he must have known from the first that the offer was made in mistaken terms, claimed that the contract should be performed and sued for specific performance. This was refused: the plaintiff was left to such action at law as he might be advised to bring. ^ The case was described later as one "where a person snapped at an offer which he must have perfectly well known to be made by mis- take." *" The power of the Coiui; of Chancery in former times, of the Chancery Division now, to rectify deeds or written instruments is as a rule reserved for cases where the parties had agreed and the terms of the agreement, by fault of neither, failed to express their meaning. a (1861) 30 Beav. 62. 5 Per James, L.J., Tamplin ». James, (1880) 15 Ch. D. 221. ^ An action for damages at law ought equally to fail. ' Shelton v. Ellis, wpra; Chute v. Quincy, (1892) 156 Mass. 189 (specific performance refused, but court declined to rescind the contract); Burk- halter v. Jones, (1884) 32 Kans. 5 (specific performance denied); Mansfield V. Sherman, (1889) 81 Me. 365 (specific performance denied); SuUivan v. Jennings, (1888) 44 N.J. Eq. 11 (specific performance denied). 216 THE FORMATION OF CONTRACT [Chap. VI But a contract may be rectified where mistake is not mutual. In such cases — and they are not numerous — one of the parties has known that when the other made a promise he was in error as to the nature or extent of it. The promisee is not then allowed to take advantage of the error. Or an offer is made in terms which, from the tenor of previous negotiations, the offeree, when he accepts, must know to include more than the offeror meant to include. The court tells the offeree, in substance, that his agree- ment must be either rectified or canceled, and that he may take his choice. A and X signed a memorandum of agreement by which A promised to let certain premises to X "at the rent of £230, in all respects on the terms of the within lease": and this memoran- dum accompanied a draft of the lease referred to. A, in filling in the blank in the draft for the amount of rent to be paid, inad- vertently entered the figures £130 instead of £230; and the lease was engrossed and executed with this error. The court was sat- isfied, upon the evidence, that X was aware that A beheved her to be promising to pay a rent higher than that which she was actually promising, and she was given the option of retaining the lease, amended so as to express the real intention of the parties, or of giving up, and paying at the rate of £230 per annum for such use and occupation of the premises as she had enjoyed." Harris v. Pepperell ' and Paget v. Marshall ° were cases in which the defendant accepted an offer which he must have known to express something which the offeror did not intend to express. The defendant was offered the alternative of cancella- tion or rectification. In these cases the promise was sought to be set aside; in Wehster v. Cecil it was sought to be enforced. Otherwise the circumstances are the same. ^ ' a Gerrard v. Frankel, (1862) 30 Beav. 445. b (1867) L.R. 5 Eq. 1. c (1884) 28 Ch. D. 255. d It ie sufficient to notice here a suggeation made by Farwell, J., in May v. Piatt, [1900] 1 Ch. 616, that this alternative of rectification or rescission is only given where there is misrepresentation amounting to fraud. He treats the decisions oited in the text as cases of fraud. This di(dum was unnecessary for the decision of the case in question, which was a simple one of failure of performance to carry out the terms of a contract; it is not borne out by the language of the judges in the cases cited. ' An alternative decree for rescission or reformation at the option of the defendant was entered in these cases; Brown v. Lamphear, (1862) 35 Vt. 252; Lawrence v. Staigg, (1866) 8 R.I. 256. See 2 Ames' Cases in Eq. Ju- ris., p. 242 note. If in these cases it is clearly proved that the terms offered were really known to the other party, and that he accepted with knowledge of the mistake in expression, the remedy should be rectification, with specific performance or damages. See Kilmer ». Smith, (1879) 77 N.Y. ^6. But if it cannot be proved with certainty what the knowledge of the Chap. VI] MISTAKE 217 (4) Effect of mistake 194. Mistake prevents formation of contract. Where mistake, within the limits that we have described, ailects the formation of a contract, no true contract comes into existence; it is void ab initio. The common law therefore offers two remedies to a per- son who has entered into an agreement void on the ground of mistake. If it be still executory he may repudiate it and success- fully defend an action brought upon it; ^ or if he have paid money under the contract, he may recover it back upon the general principle that "where money is paid to another under the influence of a mistake, that is, upon the supposition that a specific fact is true which would entitle the other to the money, but which fact is untrue, an action will lie to recover it back." " ^ And this is so even though the person paying the money did not avail himself of all the means of knowledge open to him.*" In equity the victim of mistake may resist specific perform- ance of the contract, and may sometimes do so successfully even though he might not have been able to defend at law an action for damages arising from its breach;" ' in other words equity takes cognizance of mistake in a wider sense than that given to it at common law, and is more stringent than the common law in preventing one of two parties from taking advantage of a mis- take which he knew the other party to be making.* The injured party may also as plaintiff apply to the Chancery Division of the High Court to get the contract set aside and to be freed from his Liabilities in respect of it.'' ^ a Kelly v. Solan, (1841) 9M.&W. 58. b Imp. Bank of Canada v. Bank of Hamilton, [1903] A.C. 56. e Webster v. Cecil, (1861) 30 Beav. 62. d Paget v. Marshall, (1884) 28 Ch. D. 255. offeree was, the alternative of rescission with a quasi-contractual duty to pay for benefits received does practical justice. The flexibility of equity gives it some advantage over the conunon law, where the jury is assumed to be infaUible and no compromise measure on the groimd of uncertainty as to the facts is available. 1 Gibson v. PelMe, (1877) 37 Mich. 380; Sherwood v. Walker, (1887) 66 Mich. 568. * Woods. Sheldon, (1880) 42 N.J. L. 421; Martin v. McCormick, (1854) 8 N.Y. 331; Stanley &c. Co. v. Bailey, (1878) 45 Conn. 464; Rodliff v. Dal- hnger, (1886) 141 Mass. 1. This is fully treated in works on Quasi-Contracts. ' Chute V. Quinoy, (1892) 156 Mass. 189 (specific performance refused, but rescission also refused). * It is beUeved that this is true only in so far as the more flexible pro- cedure in equity permits a greater variety of remedy. See preceding page, note 1. » Haviland v. WiUets, (1894) 141 N.Y. 35; Page v. Higgins, (1889) 150 Mass. 27; Shelton v. Ellis, supra. 218 THE FORMATION OF CONTRACT [Chap. VI II. INNOCENT MISREPRESENTATION 195. Distinctions. In dealing with misrepresentation as a cir- cumstance invalidating contract we must keep before us two dis- tinctions. We must carefully separate innocent misrepresenta- tion of fact from wilful misrepresentation of fact, or fraud: and we must separate with equal care representations, or statements which are preliminary to and perhaps induce the making of a contract, from the terms contained in the completed contract itself. With these distinctions in view, we may hope to encounter successfully the difficulties which meet us in determining the effect of innocent misrepresentation in contract. (1) We must, firstly, distinguish innocent misrepresentation from fraud, and must consider whether honesty of motive or ignorance of fact can remove a statement in fact false from the category of fraud. (2) We must, secondly, bear in mind that a man may, during the preliminary bargaining, make statements of fact which are afterwards embodied in the contract itself in the form of an un- dertaking or warranty that certain things are; just as he may promise that certain things shaE be. In either case the under- taking or promise is a term of the contract. On the other hand he may make, during the preliminary bargaining, statements of fact, intended by neither party to be terms of the subsequent contract, but which, nevertheless, may seriously affect the in- chnation of one party to enter into it. Representation therefore may introduce terms into a contract and affect performance: or it may induce a contract and so affect the intention of one of the parties, and the formation of the contract. It is with this last that we have to do, and here the terminology of this part of the subject is extraordinarily con- fused. Representation, condition, warranty, independent agree- ment, imphed warranty, warranty in the natmre of a condition, are phrases which it is not easy to follow through the various shades of meaning in which they are used. (3) We must, thirdly, take note of the effect of the Judica- ture Act, combined with subsequent decisions, in modifjdng the rules of common law and expanding those of the chancery in re- spect of innocent misrepresentations made prior to the forma- tion of a contract. We shall see that, as a result of this combination and expan- C5HAP. VI] INNOCENT MISREPRESENTATION 219 sion of earlier rules, material misrepresentation is now an invali- dating circumstance in all contracts, while even non-disclosure of fact will affect contracts of a special sort known as contracts "vherrimae jvdd," in which the utmost good faith and accuracy of statement is required. These difficulties will be dealt with in order. (1) Innocent misrepresentaiion distinguished from fraitd 196. Fraud as a tort. Fraud differs from innocent misrepre- sentation in that one does, and the other does not, give rise to an action ex delicto. Fraud is a wrong in itself, and may be treated as such, besides being a vitiating element in contract. Innocent misrepresentation may vitiate a contract, but never gives rise to an action ex delicto, the action of deceit.^ "It must be borne in mind," says Cotton, L.J., "that in an action for setting aside a contract which has been obtained by misrepresentation, the plaintiff may succeed though the misrepresentation was innocent; but in an action of deceit, the representation to found the action must not be innocent, that is to say it must be made either with a knowledge of its being false or with a reckless disregard as to whether it is or is not true."" But a false statement may be made knowingly, yet not with a bad motive: on the other hand, it may be made with no certain knowledge that it is false, but nevertheless with a dishonest mo- tive for wishing it to be believed by the party to whom it is made. a Atkwright t. Newbold, (1881) 17 Ch. D. 320. 1 This distinction is generally observed throughout the United States. Cowley V. Smyth, (1884) 46 N.J. L. 380; Taylor v. Leith, (1875) 26 Ohio St. 428; Da Lee v. Blackburn, (1873) 11 Kans. 190; Tucker v. White, (1878) 125 Mass. 344; Wakeman v. Dalley, (1872) 51 N.Y. 27. But in at least two jurisdictions an action for damages will lie for innocent misrepresenta- tions. "The doctrine is settled here, by a long line of cases, that if there was in fact a misrepresentation, though made innocently, and its deceptive influence was effective, the consequences to the plaiatifiF being as serious as though it had proceeded from a vicious purpose, he would have a right of action for the damages caused thereby, either at law or in equity." Morse, J., in Holcomb v. Noble, (1888) 69 Mich. 396; Johnson v. Gulick, (1896) 46 Neb. 817; and see also, Davis v. Nuzum, (1888) 72 Wis. 439; Huntress v. Blodgett, (1910) 206 Mass. 318; Lehigh Z. & I. Co. v. Bamford, (1893) 150 U.S. 665. And a few jurisdictions, while denying an independent action in such cases, allow the defendant to set up the damages by way of counter claim to an action for the price. Mulvey v. King, (1883) 39 Ohio St. 491; Loper V. Robmson, (1881) 54 Tex. 610; but see Mclntyre v. Buell, (1892) 132 N.Y. 192; King v. Eagle Mills, (1865, Mass.) 10 Allen, 548; First Nat. Bk. V. Yooum, (1881) 11 Neb. 328. 220 THE FORMATION OF CONTRACT [Chap. VI 197. Deceit without dishonest motive. Let us take the first of these cases. "It is fraud in law if a party make representations which lie knows to be false and injury ensues, although the motives from which the representations proceeded may not have been bad." " In Polhill V. Walter,^ Walter accepted a bill of exchange drawn on another person: he represented himself to have authority from that other to accept the bill, honestly believing that the ac- ceptance woidd be sanctioned, and the bill paid by the person for whom he professed to act. The bill was dishonored at ma- turity, and an indorsee, who had given value for the bill on the strength of Walter's representation, brought against him an ac- tion of deceit. He was held Hable, and Lord Tenterden in giving judgment said: "If the defendant when he wrote the acceptance, and, thereby, in substance, represented that he had authority from the drawee to make it, knew that he had no such authority (and upon the evidence there can be no doubt that he did) , the representation was untrue to his knowl- edge, and we think that an action will lie against him by the plaintiff for the damage sustained in consequence." It will be obsei-ved that in this case the representation was known to be false; it is therefore clearly distinguishable from a class of cases in which it has finally been held that a represen- tation in fact false but honestly believed to be true by the party making it, will not give rise to the action of deceit." * 198. Reckless misstatements. On the other hand it is not necessary, to constitute fraud, that there should be a clear knowledge that the statement made is false. Statements which are intended to be acted upon, if made recklessly and with no reasonable ground of belief, may furnish such evidence of a dis- honest mind as to bring their maker within the remedies appro- priate to fraud. Where directors issue a prospectus setting forth the advan- tages of an undertaking into the circumstances of which they have not troubled themselves to inquire, and inducing those who read the prospectus to incur liabilities in respect of the un- dertaking, they conimit a fraud if the statements contained in a Per Tindal, C.J., Foster i. Charles, (1830) 7 Bing. 107. 6 (1832) 3 B. & Ad. 114. c Deny v. P eek, (1889) 14 App. Cas. 337. 1 McKown V. Furgason, (1878) 47 Iowa, 636; Salisbury v. Howe, (1881) 87 N.Y. 128, 135; Kountze v. Kennedy, (1895) 147 N.Y. 124. Chap. VI] INNOCENT MISREPRESENTATION 221 the prospectus are untrue; for they represent themselves to have a behef which they know they do not possess." ' 199. Deceit and misrepresentation distinguished. In the cases which we have just considered there is a statement of fact accompanied either with knowledge of falsehood or else with in- tention or wiUingness to deceive. Herein innocent misrepre- sentation differs from fraud: for innocent misrepresentation is a misstatement of facts not known to be false or a non-disclosure of facts not intended to deceive; whereas fraud is a statement known to be false, or made in ignorance as to its truth or false- hood, but confidently, so as to represent that the maker is cer- tain when he is imcertain. The injured party is then entitled to the action of deceit.^ a Reese River Mining Co. t. Smith, (1869) L.R. 4 H.L. 64. ' It is everywhere held that actual knowledge of falsity, or reckless dis- regard of truth or falsity, will be sufficient to found an action in tort for deceit. In addition some states hold that a positive statement of a fact susceptible of actual knowledge, made as of one's own knowledge, will if false be sufficient. Chatham Furnace Co. v. Moffatt, (1888) 147 Mass. 403; Weeks v. Currier, (1898) 172 Mass. 63. For a full discussion of the nice dis- tinctions possible herein and of the many specific divisions, see WUliston, " LiabiUty for Honest Misrepresentation," 24 Harvard Law Review, 415, 427-40. In a few states negligent statements are apparently held sufficient. Sealew. Baker, (1888) 70 Tex. 283; Gernerw. Mosher, (1899) 68 Neb. 135; Hoff- man V. Dixon, (1900) 106 Wis. 316. See Smith, 14 Harvard Law Review, 184. 2 As the preceding notes indicate, there are these possible cases: (1) a statement known to be false; (2) a statement made with reckless disregard of its truth or falsity; (3) a statement of a fact susceptible of accurate knowledge made as of one's own knowledge, but believed to be true; (4) a statement made negligently, that is without reasonable groimds for be- lieving it to be true, but believed to be true; (5) a statement as to authority made by an agent even though believed on reasonable groimds to be true. The first two cases are clearly actionable deceit. The last case is treated as an implied warranty of authority. The third and fourth cases lead to diver- gent decisions, but they seem to be substantially identical. The basis of the defendant's liability in such cases is not deceit or fraud, but rather negligence. The plaintiff's right is to recover the amount of his loss, and does not depend upon enrichment of the defendant. If there is such en- richment, the plaintiff may no doubt recover on the theory of a non- contract debt (or quasi-contract) and waiver of tort. In the absence of enrichment of the defendant, there is no strong reason for classifying the plaintiff's claim as quasi-contractual. He is suing for the amount of his loss, caused by the act of the defendant, such act being that of a man not reason- ably prudent. Cf . Williston, 24 Harvard Law Review, 415, 420, 436. It is possible that the rule should be regarded as one of absolute Uabihty and that the plaintiff should not be required to prove negligence. But even if so, the liability properly falls in the field of tort, and exists for the purpose of inducing a high degree of care and thus preventing damage. The rule would be, in that case, what Professor Wigmore calls a " prophylactic rule." See in general. Smith, " Liability for Negligent Language," 14 Harvard Law Re- mew, 184; Bigelow on Torts (7th ed.), §§ 139-44j Burdick on Torts, pp. 372-74. See § 223, post. 222 THE FORMATION OF CONTRACT [Chap. V (2) Representations inducing a contract distinguished from terms of a completed contact 200. Representations and terms. Equally important with the distinction between innocent misrepresentation and fraud is the distinction between the terms of a completed contract and statements which are inducements to enter into a contract." Much subtlety of reasoning has been wasted because, where a man has in good faith made a promise which he is ultimately imable to perform, it has been said that his promise was mis- representation, or was made under a mistake of fact, and so questions proper to the performance or breach of contract have been mixed with questions relating to the formation of con- tract.* We must bear in mind, first, that a representation which is subsequently made part of the contract ceases to be a represen- tation, and becomes a promise that a certain thing is or shall be; and next, that unless a representation is made part of the contract, its untruth (in the absence of fraud) gives rise to no claim for damages." 201. Representations, conditions, and warranties. At com- mon law, therefore, if a representation did not afterwards be- come a substantive part of the contract, its untruth (save in certain excepted cases and apart always from fraud) was imma- terial. But if it did, it might be one of two things: (1) it might be regarded by the parties as a vital term going to the root of the contract (when it is usually called a "condition ") ; and in this case its imtruth entitles the injured party to repudiate the whole contract; or (2) it might be a term in the nature only of an in- dependent subsidiary promise (when it is usually called a "war- ranty"), which is indeed a part of the contract, but does not go to the root of it; in this case its untruth only gives rise to an ac- tion ex contractu for damages, and does not entitle the injured party to repudiate the whole contract. Whether a term is to be regarded as a condition or a warranty is a matter of construction for the court to determine. a Other difficulties have arisen from a view at one time entertained by courts of equity, that there may be representations which are not terms in a contract but which ought never- theless to be made good by the party responsible for them. Such representations, in the cases where they occur, can all be resolved into terms of a contract. I touch at the close of this chapter on representation which creates an estoppelf and so may prevent the dis- proof of an alleged right; but this is a different thing from the theory advanced in Coverdale e. Eastwood, (1872) 15 Eq. 121. b Kennedy v. Panama Steam Co., (1867) L.B. 2 Q.B. 680. c De Lassalle t>. Guildford, [1901] 2 E.B. 215. Chap. VI] INNOCENT MISREPRESENTATION 223 But two points must be borne in mind. In the first place, the words "condition" and "warranty" are not invariably kept as distinct as accuracy of definition demands; and in insurance law especially "warranty" is very commonly used in the sense ascribed to "condition" above." In the second place, the in- jured party, if he chooses to waive his right to repudiate the contract on breach of a condition, may still bring an action for such damages as he has sustained.^ 202. Illustrations. The common-law rules on the subject of conditions, warranties and representations may be illustrated from the judgments delivered in the three cases of Behn v. Bur- ness,^ WalKs v. PraM," and Heilbut v. Buckleton.^ In the case of Behn v. Bumess, an action was brought upon a charter party dated the 19th day of October, 1860, in which it was agreed that Behn's ship "now in the port of Amsterdam" should proceed to Newport and there load a cargo of coals which she should carry to Hong Kong. At the date of the contract the ship was not in the port of Amsterdam and did not arrive there until the 23d. When she reached Newport, Biu-ness refused to load a cargo and repudiated the contract. Thereupon action was brought, and the question for the court was whether the words "now in the port of Amsterdam" amounted to a condition the breach of which entitled Bumess to repudiate the contract, or whether they only gave him a right, after carrying out the con- tract, to sue for such damages as he had sustained. The Ex- chequer Chamber held it to be a condition,' and Williams, J., in giving the judgment of the court, thus distinguishes the various parts or terms of a contract: . "Properly speaking, a representation is a statement or assertion, made by one party to the other, before or at the time of the contract, of some matter or circumstance relating to it. Though it is sometimes con- tained in the written instrument, it is not an integral part of the con- tract; and, consequently, the contract is not broken though the repre- sentation proves to be untrue; nor (with the exception of the case of policies of insurance, at all events, marine policies, which stand on a peculiar anomalous footing) is such untruth any cause of action, nor has it any efficacy whatever unless the representation was made fraudu- lently, either by reason of its being made with a knowledge of its un- a See Marine Insurance Act, 1906, H 33-41. b (1863) 3 B. & S. 751. e [1910] 2 K.B. 1003. d [1913] A.C. 30. 1 But see post, § 203, note 4. « Davison v. Von Lingen, (1884) 113 U.S. 40; Gray v. Moore, (1889) 37 Fed. 266; Wells, Fargo & Co. v. Pacific Ins. Co., (1872) 44 Cal. 397; Morrill V. WaUace, (1837) 9 N.H. Ill; Wolcott v. Mount, (1873) 36 N.J.L. 262. 224 THE FORMATION OF CONTRACT [Chap. VI truth, or by reason of its being made dishonestly, with a reckless igno- rance whether it was true or untrue. . . . Though representations are not usually contained in the written instrument of contract, yet they sometimes are. But it is plain that their insertion therein cannot alter their nature. A question however may arise whether a descriptive state- ment in the written instrument is a mere representation, or whether it is a substantive part of the contract, i This is a question of construc- tion which the court and not the jury must determine. If the court should come to the conclusion that such a statement by one party was intended to be a substantive part of his contract, and not a mere repre- sentation, the often-discussed question may, of course, be raised, whether this part of the contract is a condition precedent, or only an independent agreement, a breach of which will not justify a repudiation of the contract, but wiU only be a cause of action for a compensation in damages." The distinction referred to in the last words of the passage quoted is amplified in the judgment of Fletcher Moulton, L.J., in Wallis v. PraU:'* "There are some [obligations] which go so directly to the substance of the contract, or in other words are so essential to its very nature, that their non-performance may fairly be considered by the other party as a substantial failure to perform the contract at all. On the other hand, there are other obligations which though they must be performed, are not so vital that a failure to perform them goes to the substance of the contract. Both classes are equally obligations under the contract, and the breach of any one of them entitles the other party to damages. But in the case of the former he has the alternative of treating the contract as completely broken by the non-performance and (if he takes the proper steps) he can refuse to perform any of the obligations resting upon himself and sue the other party for a total failure to perform the contract. Although the decisions are fairly con- sistent in recognizing this distinction between the two classes of obli- gations under a contract, there has not been a similar consistency in the nomenclature appUed to them. I do not, however, propose to discuss this matter, because later usage has consecrated the term 'condition' to describe an obligation of the former class and 'warranty ' to describe an obligation of the latter class. ... A condition and a warranty are alike obligations under a contract a breach of which entitles the other party to damages. But in the case of a breach of a condition, he has the option of another and a higher remedy, namely, that of treating the contract as repudiated." ' o [1910], 2 K.B. 1003, 1012; [1911] A.C. 394. ' It is not very happily expressed to say that a written representatioH is not "an integral part" or "a substantive part" of the contract. We need only say here that the truth of a representation is sometimes a condition and sometimes not. « But cf. § 203, note 4. Chap. VI] INNOCENT MISREPRESENTATION 225 In Heilbut v. Buckleton " the action was for fraudulent mis- representation and for breach of warranty. The jury negatived fraud, but found that a statement made by the defendants' manager in answer to a question before the contract was con- cluded was a warranty. The House of Lords held that there was no evidence on which the jury could so find, and Lord Moulton (as he then had become) said: "The statement made in answer to the plaintiff's question was be- yond controversy a mere statement of fact, for it was in reply to a ques- tion for information and nothing more. No doubt it was a representa- tion as to fact, and indeed it was the actual representation upon which the main case of the plaintiff rested. . . . The whole cause for the exist- ence of collateral contract therefore rests on the mere fact that the statement was made as to the character of the company, and if this is to be treated as evidence sufficient to establish the existence of a collat- eral contract of the kind alleged the same result must foUow with regard to any other statement relating to the subject-matter of a con- tract made by a contracting party prior to its execution. This would negative entirely the firmly established rule that an iimocent represen- tation gives no right to damages. It would amount to saying that the making of any representation prior to a contract relating to its subject- matter is sufficient to establish the existence of a collateral contract that the statement is true and therefore to give a right to damages if such should not be the case." A judgment of Holt, C.J., was cited with approval to the ef- fect that "an affirmation at the time of the sale is a warranty, provided it appear on evidence to be so intended," * and the opinion of the Court of Appeal in a later case that in determining whether it was so intended a "decisive test" is whether the offender assumes to assert a fact of which the buyer is ignorant was emphatically rejected." Words which on the face of them appear to be simply representations of fact, said Lord Haldane, may import a contract of warranty, but only if the context so requires.'^ 203. Definitions of the terms. The three judgments cited en- able us to get a clear idea of the various terms in a contract. (a) Representations, made at the time of entering into the contract, but not intended by both parties to form a part of it, have no effect on its validity, imless they are fraudulent. When this is the case, their falsehood vitiates the formation of the con- tract and makes it voidable. (6) Conditions ' are terms which are of the essence of the con- a [1913] A.C. 30. b Crosse ». Gardner, (1689) Garth. 90. e Be Lassalle v. GuUdford, [1901] 2 K.B. 215, 221. d Heilbut v. Buckleton, [1913] A.G. 30, 37. e For a fuller discussion of the terms "Condition" and 'Warranty" see ohaps. ziii, XT. 226 THE FORMATION OF CONTRACT [Chap. VI tract.' When a term in the contract is construed by the court as a condition, then, whether it be a statement or a promise, the un- truth, or the breach, of it will entitle the party to whom it is made to be discharged from his liabihties under the contract.^ (c) Warranties [ab iniUo] are independent subsidiary prom- ises, the breach of which does not discharge the contract, but gives to the injured party a right of action for such damage as he has sustained by the failure of the other to fulfill his promise.' (d) Warranties [ex post facto]. A condition may be broken and the injured party may not avail himself of his right to be dis- charged, but continue to take benefit under the contract, or at any rate to act as though it were still in operation. In such a case the condition sinks to the level of a warranty, and the breach of it, being waived as a discharge, can only give a right of action for the damage sustained.* 1 This term condition is generally used to describe any fact, subsequent to the fonnation of a contract, which operates to make the duty of a prom- isor immediately active and compelling. Such a fact may be described as such in a term of the contract or it may not. In either event, the term of the contract should not itself be called the condition. This is more fully discussed later, § 355 et seq. It is not uncommon, popularly, to speak of a condition of the contract as s3Tionymous with term or provision of the contract. This should be avoided. ' The non-fulfillment of a condition (i.e., the non-existence of the neces- sary, operative fact) does not discharge all the legal relations that compose a contract. It does, however, prevent the existence of the promisee's right and of the promisor's drUy, and it discharges the promisor's pre-existing liability that a duty might come into existence. The promisor still retains a power, by waiver or otherwise, to renew the previous legal relations, at least in some degree- See post, § 363. • "A warranty is a separate, independent, collateral stipulation . . . for the existence or truth of some fact relating to the thing sold. It is not strictly a condition, for it neither suspends nor defeats the completion of the sale, the vesting of the thing sold in the vendee, nor the right to the purchase money in the vendor." Shaw, C.J., in Dorr v. Fisher, (1848, Mass.) 1 Cush. 271, 273-74. But there is a conflict of authority as to whether a breach of an express warranty will enable the injured party to rescind the contract. See 16 Harvard Law Review, 465; 4 Columbia Law Review, 1, 195, 264. ♦ This statement is true only in case the condition is a fact the existence or fulfillment of which is assured by a promise. If its fulfillment is not promised, a waiver of the condition nullifies its effect as a condition without giving any right of action for damages. See § 190 ante for the implied conditions in the sale of goods. Whether they survive acceptance of the goods and may be enforced as implied war- ranties the American cases are not agreed. The weight of authority favors the view that an impUed warranty survives acceptance. Morse v. Moore, (1891) 83 Me. 473; Northwestern Cordage Co. t>. Rice, (1896) 5 N.Dak. 432; English v. Spokane Comm. Co., (1893) 57 Fed. 451; Gould v. Stein, (1889) 149 Mass. 570; Wolcott v. Mount, supra. But there is strong author- C!hap. VI] INNOCENT MISREPRESENTATION 227 (3) Effed of innocent misrepresentation and remedies therefor 204. Outline. In order to ascertain the effect of innocent mis- representation or non-disclosure upon the formation of con- tract, I will first compare the attitude of common law and of equity toward innocent misrepresentation before the Judicature Act, and then consider how far the provisions of the Judicature Act, interpreted by judicial decision, enable us to lay down in general terms a rule which was previously applicable only to a special class of contracts. 205. Anterior representations at law. The case of Behn v. Burness shows that in the view of the common-law courts a rep- resentation was of no effect unless it was either (1) fraudulent, or (2) had become a term in the contract: the case of Bannerman V. White " shows that the strong tendency of judicial decision was to bring, if possible, into the terms of the contract, any statement which was material enough to affect consent. Bannerman offered hops for sale to White. White asked if any stdphm- had been used in the treatment of that year's growth. Bannerman said "no." White said that he would not even ask the price if any sulphm- had been used. They then discussed the price, and White ultimately purchased by sample the growth of that year; the hops were sent to his warehouse, were weighed, and the amoimt due on their purchase was thus ascertained. He afterwards repudiated the contract on the ground that sulphur had been used in the treatment of the hops. Bannerman sued for their price. It was proved that he had used sulphur over 5 acres, the entire growth consisting of 300 acres. He had used it for the purpose of trying a new machine, had afterwards mixed the whole growth together, and had either forgotten the matter or thought it unimportant. The jury found that the representa- tion made as to the use of, sulphur was not wilfully false, and they further found that "the aflBrmation that no sulphur had been used was intended by the parties to be part of the contract of sale, and a warranty by the plaintiff." The court had to con- sider the effect of this finding, and held that Bannerman's repre- o (1861) 10 C.B. (N.S.) 844. ity to the contrary. Reed v. Randall, (1864) 29 N.Y. 358; Coplay Iron Co. V. Pope, (1888) 108 N.Y. 232 [but see Zabriskie v. Ry., (1892) 131 N.Y. 72]; Lee v. Bangs, (1890) 43 Minn. 23; Williams v. Robb, (1895) 104 Mich. 242; Jones v. McEwan, (1891) 91 Ky. 373. See Mechem on Sales, §§ 1392, 1393. 228 THE FORMATION OF CONTRACT [Chap. VI sentation was a part of the contract, a true condition, the breach of which discharged White from liability to take the hops. Erie, C.J., said: " We avoid the term warranty because it is used in two senses, and the term condition because the question is whether that term is applicable. Then, the effect is that the defendants required, and that the plaintiff gave his undertaking that no sulphur had been used. This undertaking was a preliminary stipulation; and, if it had not been given, the defend- ants would not have gone on with the treaty which resulted in the sale. In this sense it was the condition upon which the defendants contracted; and it would be contrary to the intention expressed by this stipulation that the contract should remain valid if sulphur had been used. "The intention of the parties governs in the making and in the con- struction of all contracts. If the parties so intend, the sale may be absolute, with a warranty superadded; or the sale may be conditional, to be null if the warranty is broken. And, upon this statement of facts, we think that the intention appears that the contract should be null if sulphur had been used: and upon this ground we agree that the rule should be discharged."" Note that in this case the representation was made before the parties commenced bargaining; whereas the representation m Behn v. Burness was a term in the charter party. Note, fmrther, that the actual legal transaction between the parties was an agreement to sell by sample a quantity of hops, a contract which became a sale,* so as to pass the property, when the hops were weighed and their price thus ascertained. The contract of sale contained no terms making the acceptance of the hops conditional on the absence of sulphur in their treatment: and the language of Erie, C.J., shows that he felt it difficult to apply the terms "condition" or "warranty" to the representa- tion made by the plaintiff. "The undertaking," he says, "was a preliminary stipula- tion"; to introduce it into the contract was to include in the contract the discussion preliminary to the bargain. What had happened was that Bannerman made a statement to White, and then the two made a contract which did not include this state- ment, though but for the statement the parties would never have entered on a discussion of terms. The consent of the buyer was, in fact, obtained by a misrepresentation of a material fact, and was therefore unreal, ^ but the common-law courts had precluded a Bannerman v. White, (1861) 10 C.B. (N.S.) 860. 6 For the distinction between a sale, and an agreement to sell, see § 113, supra, and Sale of Goods Act, 1893, 56 & 57 Vict. c. 71, § 1. 1 This form of expression is objectionable. The consent was real; but the duty to pay was conditional, because the parties so expressed themselves. Chap. VI] INNOCENT MISREPRESENTATION 229 themselves from giving any effect to a representation unless it was a term in the contract, and so in order to do justice they were compelled to construe the contract as though it contained this term.i 206. Anterior representations in equity.^ In considering the principles on which equity has dealt with innocent misrepresen- tation and non-disclosure of fact we must bear in mind that cer- tain classes of contracts have always been regarded as needing more exact and full statement than others of every material fact which might influence the minds of the parties. Some of these were of a sort with which the com:t of chancery was more par- ticularly concerned — contracts to take shares in companies — contracts for the sale and purchase of land. We must also remember that judges in the court of chancery never had occasion to define fraud with precision as an action- able wrong. They therefore, not unnaturally, used the term "fraudulent" as apphcable to all cases in which they refused specific performance or set aside an instrument on the ground that one of the parties had not acted in good faith; and some- what unfortunately they applied the same term to representa- tions which were made in good faith though they afterwards turned out to be untrue. But we find no general rule as to the effect of innocent mis- representation until 1873, when, in a case precisely sinailar to ' The effect of innocent misrepresentation in the common law may be thus stated: (1) No action in tort for deceit will lie (but contra in Michigan and Nebraska). (2) A counterclaim for damages based upon innocent mis- representation cannot be interposed to an action for the price. King v. Eagle Mills, (1865, Mass.) 10 Allen, 548; Shook v. Singer Mfg. Co., (1878) 61 Ind. 520; Scroggin v. Wood, (1893) 87 Iowa, 497; Mclntyre v. Buell, (1892) 132 N.Y. 192; but see Mulvey v. King, (1883) 39 Ohio St. 491; Leper V. Robinson, (1881) 54 Tex. 510. (3) There can be no rescission in any form of common -law action, as for example replevin. Johnston v. Bent, (1890) 93 Ala. 160; Bamett v. Speir, (1894) 93 Ga. 762; Gregory v. Schoenel, (1876) 55 Ind. 101; Pike v. Fay, (1869) 101 Mass. 134; Hotchkin v. Bank, (1891) 127 N.Y. 329. But it has been suggested, and even held, in some cases that sinc-e the union of law and equity the equity rule should be fol- lowed in common-law cases. Frenzel v. Miller, (1871) 37 Ind. 1; Brooks v. Riding, (1874) 46 Ind. 15 (but see Gregory 0. Schoenel, supra); Gunby v. Sluter, (1875) 44 Md. 237. Since in equity the cases proceed on the ground of mutual mistake [Spurr v. Benedict, (1868) 99 Mass. 463] there would seem to be no sound objection to adopting the same reasoning in common- law actions involving simply rescission. See School Directors v. Boomhour, (1876) 83 HI. 17; Woodruff v. Saul, (1883) 70 Ga. 271 (but see Barnett v. Speir, supra). 2 See also post, § 227. 230 THE FORMATION OF CONTRACT [Chap. VI Bannerman v. White, a similar result was reached by the appli- cation of a different principle." Lamare, a merchant in French wines, entered into negotia- tions with Dixon for a lease of cellars. He stated that it was es- sential to his business that the cellars should be dry, and Dixon assured him, to his satisfaction, that the cellars would be dry. He thereupon made an agreement for a lease, in which there was no term or condition as to the drsmess of the cellars. They turned out to be extremely damp. Lemare declined to continue his occupation, and the House of Lords refused to enforce spe- cific performance of the agreement, not because Dixon's state- ment as to the dryness of the cellars was a term in the contract, but because it was material in obtaining consent and was untrue in fact. "I quite agree," said Lord Cairns, "that this representation was not a guarantee.* It was not introduced into the agreement on the face of it, and the result of that is that in all probabihty Lamare could not sue in a court of law for a breach of any such guarantee or undertaking: and very probably he could not maintain a suit in a court of equity to cancel the agreement on the ground of misrepresentation. At the same time, if the representation was made and if that representation has not been and cannot be fulfilled, it appears to me upon aU the authorities that that is a perfectly good defense in a suit for specific performance, if it is proved in point of fact that the representation so made has not been fulfilled.'" Thus it appears, that up to the passing of the Judicature Act the Court of Chancery would refuse specific performance of a contract induced by innocent misrepresentation, ^ and that in transactions of certain kinds it was prepared to set contracts aside on the same grounds. The latter remedy had not by ex- press decision been limited to transactions of the kind I have mentioned, while on the other hand no general rule had been laid down which might apply to all contracts.* a Lamare v. Dixon, (1S73) L.K. 6 H.L. 414. !i " Guarantee" must be undeistood here to mean " watrsnty," and not the oontiact dealt with in § 97. c Lamare v. Dixon, supra, at p. 428. ' Boynton v. Hazelboom, (1867, Mass.) 14 Allen, 107; Isaacs v. Skrainka, (1888) 95 Mo. 517. * Equity will rescind contracts for innocent misrepresentation. Gross- man V. Lewis, (Mass. 1917) 115 N.E. 236; Wilcox v. Iowa Wesleyan Univ., (1871) 32 Iowa, 367; Hunter v. French &c. Co., (1896) 96 Iowa, 573; Brooks V. Hamnton, (1870) 15 Minn. 26; Beebe v. Young, (1866) 14 Mich. 136; Hammond v. Pennock, (1874) 61 N.Y. 145; Can- v. Nat. Bk., (1901) 167 N.Y. 375; Doggettw. Emerson, (1845, U.S. C.C.) 3 Story, 700. This is sometimes worked out on the ground of mutual mistake. Spuir ». Benedict, (1868) Chap. VI] INNOCENT MISREPRESENTATION 231 207. Effect of English Judicature Act. The Judicature Act " provides that a plaintiff may assert any equitable claim and a defendant set up any equitable defense in any court, and that where the rules of equity and law are at variance, the former shall prevail, and in their treatment of this provision there is no doubt that the courts have extended the application of equitable remedies and altered the character of the common-law rule. In- nocent misrepresentation which brings about a contract is now a ground for setting the contract aside, and this rule appUes to contracts of every description.* The case of Redgrave v. Hurd " was the first in which this rule was applied. It was a suit for specific performance of a contract to buy a house. Redgrave had induced Hurd to take, with the house, his business as a soUcitor, and it was for misstatement as to the value of this business that Hurd resisted specific per- formance, and set up a counterclaim to have the contract re- scinded and damages given him on the groimd of deceit practiced by Redgrave. The Court of Appeal held that there was no such deceit, or statement false to Redgrave's knowledge, as would entitle Hurd to damages; but specific performance was refused and the contract rescinded on the ground that defendant had been induced to enter into it by the misrepresentation of the plaintiff. The law on this subject is thus stated by Jessel, M.R. : " As regards the rescission of a contract there was no doubt a difference between the rules of courts of equity and the rules of courts of common a 36 & 37 Vict. 0. 66, § 24, sub-ss. 1, 2, and § 25, sub-s. 11. b The Court of Appeal of New Zealand, in Riddiford v. Warren, (1901) 20 N.Z. L.R. 572, has taken exception to this statement of the law so far as regards the sale of goods, upon a construction of local statutes identical with the Judicature Act, § 25 (11) and the Sale of Goods Act, § 61 (2). The latter provides that *'the rules of the common law, includ- ing the law merchant," and in particular the rules relating to the effect of (filler alia) mis- representation shall continue to apply to the sale of goods. It is said that this amounts to a declaration that the common-law rules alone (to the exclusion of those of equity) applied to such contracts up to the passing of this Act and are alone to be considered since the Act. But it is respectfully submitted (1) that no such declaration can properly be implied from the language of the statute; and (2) that the phrase "rules of the common law" must be read subject to the express provisions of the Judicature Act. Schrfider v, Mendl, (1877) 37 L.T. 452, and Hindle s. Brown, (1908) 98 L.T. 44, both seem to show that the sale of goods is in no different position from other contracts. e (1881) 20 Ch. D. 1. 99 Mass. 463; Keene v. Demelman, (1898) 172 Mass. 17; Belknap v. Sealey, (1856) 14 N.Y. 143; Paine v. Upton, (1882) 87 N.Y. 327; Smith v. Bricker, (1892) 86 Iowa, 285; Smith v. Richards, (1839, U.S.) 13 Pet. 26. The state- ment in Southern Development Co. v. Silva, (1888) 125 U.S. 247, that it is necessary to show "that such representation was not actually believed on reasonable grounds to be true," must be regarded as failing to dis- tinguish between the requirements at law and in equity. See Turner v. Ward, (1876) 154 U.S. 618. 232 THE FORMATION OF CONTRACT [Chap, VI law — a difference which of course has now disappeared by the opera- tion of the Judicature Act, which makes the rules of equity prevail. According to the decisions of courts of equity it was not necessary, in order to set aside a contract, obtained by material false representation, to prove that the party who obtained it knew at the time that the repre- sentation was made that it was false." " In Newhigging v. Adam * the rule thus laid down was adopted as of general application. The plaintiff had been induced to en- ter into a partnership with one Townend by statements made by the defendants, who were either the principals or concealed partners of Townend. The Court of Appeal held that "there was a substantial misstatement though not made fraudulently, which induced the plaintiff to enter into the contract," and the contract was set aside. Bowen, L.J., after quoting the passage set forth above from the judgment of Jessel, M.R., endeavors, not altogether effectually, to reconcile the views of common law and equity on the subject of innocent misrepresentation. " If the mass of authority there is upon the subject were gone through, I think it would be foimd that there is not so much difference as is gen- erally supposed between the view taken at common law and the view taken in equity as to misrepresentation. At common law it has alwajrs been considered that misrepresentations which strike at the root of a contract are sufficient to avoid the contract on the ground explained in Kennedy v. Panama, New Zealand and Royal Mail Co." " The case referred to by Bowen, L.J., was one of cross-actions — by a shareholder, to recover calls paid, and by a company, to recover calls due. The shareholder contended that he had been induced to take shares on the faith of a statement in the pro- spectus, which turned out to be untrue; and that this statement was so vital to the contract that its untruth amounted to a total failure of consideration, and entitled him to be discharged from his liability to calls. The position of the Court of Queen's Bench in this case was very similar to that of the Coiu:t of Common Pleas in Banner- man V. White.'' A court of equity might or might not have set the transaction aside on the ground that consent had been ob- tained by a material misrepresentation made prior to the con- tract. A court of common law could only deal with the matter by incorporating the representation with the contract, and then asking whether its untruth amounted to a total failure of consid- eration or the breach of a condition vital to the contract. o Redgrave t. Hurd, (1881) 20 Ch. D. 12. b (1886) 34 Ch. D. 582, 592. c (1867) L.R. 2 Q.B. 580. d (1861) 10 C.B. (N.S.) 844. Chap. VI] INNOCENT MISREPRESENTATION 233 In Bannerman v. White the court held that the representation was a vital condition: in Kennedy v. Panama Company '^ the court held that it was not a vital condition. Equity would give or withhold the same rehef, but upon a different and more intelhgible principle. This principle is clearly stated by Lord Bramwell in Deny v. Peek,^ speaking of the various rights of one who has been inj\u:ed by the untruth of statements inducing a contract: "To this may now be added the equitable rule that a material misrepresentation, though not fraudulent, may give a right to avoid or rescind a contract where capable of such rescission." 208. Nature of relief given. Thus a general rule is settled; in- nocent misrepresentation, if it furnishes a material inducement, is ground for resisting an action for breach of contract or for specific performance, and also for asking to have it set aside; this relief is of general appKcation, and is not pecuhar to the contracts described as uberrimae fidei. But relief can only be obtained when the transaction is re- pudiated at once, and when the parties can be relegated to the position which they occupied before the contract was made. Save in the case of fraud, rescission will not be granted after property has changed hands under a contract, and the party who has been misled must take steps to repudiate the transac- tion at the earliest possible moment. " ^ " It is well settled that a contract can only be rescinded on the ground of an innocent misrepresentation, if the parties can be put back again in their original position, and it cannot be rescinded if the contract has been so complet«l that this cannot be done.'"* Rescission of a lease duly executed, the lessee having taken possession of the premises, has been refused on these grounds. * The rehef given by the court to a person who by an innocent misrepresentation by the other party has been induced to enter into a contract may include an indemnity "against the obliga- tions which he has contracted under the contract which is set aside": but it can never as a general rule include damages for loss sustained.-^ o (1867) L.R. 2 Q.B. 580. b (1889) 14 App. Cas. 347. c Seddon v. North Eastern Salt Co., [1905] 1 Cb. 326. d Hindle v. Brown, (1908) 98 L.T. 44, at p. 45. e Angel v. Jay, [1911] 1 K.B. 666. / Newbigging v. Adam, (1886) 34 Ch. D. 589. ' Rescission has recently been decreed in the United States on the ground of innocent misrepresentation even though the contract had been fully perfonned by both parties. Bloomquist v. Farson, (1918, N.Y.) 118 N.E. 855; Canadian Agency v. Assets R. Co., (1914) 150 N.Y. Supp. 769, 165 App. Div. 96. See comment by Professor Walter W. Cook in 27 Yale Law Journal, 929. See also previous notes herein to §§ 196-200, 206. 234 THE FORMATION OF CONTRACT [Chap. VI 209. Expression of opinion. But the representation must form a real inducement to the party to whom it is addressed. The mere expression of an opinion which proves to be unfounded will not invalidate a contract. In effecting a policy of marine iasur- ance the insured communicated to the insurers a letter from the master of his vessel stating that in his opinion the anchorage of the place to which the vessel was boimd was safe and good. The vessel was lost there: but the court held that the insm-ed, in reading the master's letter to the insurers, commimicated to them all that he himself knew of the voyage, and that the letter was not a representation of fact, but of opinion, which the insurers could act upon or not as they pleased." ' 210. Commendatory expressions. Nor are commendatory ex- pressions such as men habitually use in order to induce others to enter into a bargain dealt with as serious representations of fact. A certain latitude is allowed to a man who wants to gain a pur- chaser, though it must be admitted that the border Hne of per- missible assertion is not always discernible. At a sale by auction land was stated to be "very fertile and improvable:" it was in fact partly abandoned as useless. This was held to be "a mere flourishing description by an auctioneer." * ^ But where in the sale of an hotel the occupier was stated to be "a most desirable tenant," whereas his rent was much in arrear and he went into hquidation directly after the sale, such a statement was held to entitle the purchaser to rescind the contract." 211. Damages for innocent misrepresentation. Exceptions. To the rule that no damages can be obtained for innocent mis- representation there are however three exceptions. (a) Warranty of authority. The first is where an agent in good faith assumes an authority which he does not possess and induces another to deal with him in the beUef that he has the authority which he assumes."* ' This subject is further dis- cussed in the chapter on Agency. a Anderson v. Pacific Insurance Co., (1872) L.R. 7 C.P. 65. 6 Dimmock i. Hallett, (1866) 2 Ch. 21. c Smith V. Land & House Property Co., (1884) 28 Ch. D. 7. d Collen v. Wright, (1857) 8 E. & B. 647. This liability was, by the decision in CoUene. Wright, applicable to caBes in which a contract was brought about by the innocent assump- tion of a non-existent authority. More recent cases, Firbank v. Humphreys, (1886) 18 Q.B.D. 62, and Starkey «. Bank of England, [1903] A.C. 114, have extended the liability to every transaction, contractual or otherwise, brought about by such an assumption. 1 Fish V. Cleland, (1864) 33 III. 237; Southern Development Co. v. Silva, (1888) 125 U.S. 247; Akin v. KeUogg, (1890) 119 N.Y. 441. " Deming v. Darling, (1889) 148 Mass. 504 [but see Crane v. Elder, (1892) 48 Kans. 259]; Chrysler v. Canaday, (1882) 90 N.Y. 272. » Where the agent has knowledge of his want of authority he is liable in Chap. VI] INNOCENT MISREPRESENTATION 235 (6) StaMory. The Companies (Consolidation) Act, 1908," re- quires that a prospectus of a company should contain a number of particulars which must be assumed to be material to the forma- tion of the judgment of an intending appUcant for an allotment of shares. The duty cast by the statute upon those interested in the formation of the company would seem to create a corre- sponding UabiUty to an action for damages. (c) The same Act * (re-enacting the provisions of the Direc- tors Liabihty Act," 1890) also gives a right to any person who has been induced to subscribe for shares in a company by un- true statements in a prospectus, to obtain compensation from the directors for loss sustained, unless they can show that they had reasonable groimd to believe the statement and continued to beheve it till the shares were allotted, or that the statement was a fair accoimt of the report of an expert or a correct represen- tation of an official document. 212. Estoppel. From these cases we must carefully distin- guish the sort of liability which is supported rather than created by estoppel. Estoppel is a rule of evidence,' and the rule may be stated in the words of Lord Denman: "Where one by his words or conduct wilfully causes another to be- lieve the existence of a certain state of things, and induces him to act a 8 Edw. VII, c. 69, § 81. 6 8 Edw. VII, o. 69, S 83. c 53 & 54 Vict. o. 64. tort for deceit, although he does not intend to defraud. Kroeger v. Pit- cairn, (1882) 101 Pa. 311; Noyes v. Loring, (1867) 65 Me. 408. An action against an agent for an innocent misrepresentation by words or conduct as to his authority, is, in effect, though not always in form, an exception to the general rule that an action for damages will not lie for an innocent misrepresentation. In order to avoid the recognition of the excep- tion, the coiuls invent the fiction of an " implied warranty of authority" and allow an action for the breach of this warranty. Kroeger v Pitcaim, supra; Whiter. Madison, (1862) 26 N.Y. 117; Baltzen v. Nicolay, (1873) 53 N.Y. 467; Seeberger v. McCormick, (1899) 178 DI 404; Huffcut on Agency, §183. 1 It is most misleading to call estoppel a rule of evidence, and there is no sufficient reason for distinguishing the liability in these cases from those that precede. To say that one who has made representations is estopped to deny them is to lay down a substantive rule of law that such represen- tations create a legal duty to pay loss that may be caused thereby. These representations are therefore operative facts, causing the same legal rela- tions as in the other cases explained above. This liability based ujwn an "estoppel" is merely an example of how the courts, by the use of a fiction or of a term of art that forecloses thought, evade and limit the appli- cation of an inconvenient or unjust rule such as that in Derry v. Peek, (1889) 14 App. Cas, 337. See post, § 227; Williston, 24 Harvard Law Review, 423-27. 236 'THE FORMATION OF CONTRACT [Chap. VI on that belief so as to alter his own previous position, the former is con- cluded from averring against the latter a different state of things as existing at the same time." " Where a defendant is by a rule of evidence not permitted to disprove certain facts, and where on the assumption that such facts exist the plaintiff would have a right, then estoppel comes in aid of the establishment of the right by preventing the denial or disproof of these facts. But an estoppel can only arise from words or conduct which are clear and unambiguous. This rule, and the effect of estoppel, may be illustrated by the case of Low v. Bowverie} Low was about to lend money to X on the security of X's share of a trust fund, of which Bouverie was trustee. He asked Bouverie whether this share was mortgaged or otherwise en- cmnbered, and if so to what extent. Bouverie named such charges as occiured to him, but did not name all, and the loan was made. In fact the interest of X was heavily encumbered, and when Low sued Bouverie, X was an undischarged bank- rupt. Low claimed that Bouverie, the trustee, was boimd to make good the loss. The Court of Appeal held (1) that Bou- verie's statement could not be construed as a warranty, so as to bind him by contract to Low; (2) that the statement was not false to his knowledge; (3) that the misrepresentation, being innocent, could not give rise to an action for damages, imless a duty was cast upon Bouverie to use care in statement; " (4) that no such duty rested upon a trustee, requiring him to answer questions concerning the trust ftmd to strangers about to deal with the cesbwi que trust; (5) that therefore Bouverie could only be held liable if he was estopped from contending that there were other inciunbrances upon the trust fund than those which he had mentioned to Low. If he had been so estopped he might have been ordered to pay a Kokard t. Sears, (1837) 6 A. & E. 469. b [1891] 3 Ch. (C.A.) 82. c The mention of this d-uty would seem to be an excess of judicial caution, for it is hard to see how such a duty could arise so as to give a right of action for negligent, as distinct from fraudulent, misrepresentation. Such a hability may exist in the case of employer and em- ployed, where the person employed acquires and gives information on which the employer will act. But a failure to use due care in the supply of such information would be a breach of the contract of employment, creating a Uability ex contractu not ex delicto. In cases turn- ing on negligent statement, the duty, since Derry v. Peek, (1889) 14 App Cas. 347, has been held, in each case, not to exist, and it is probably, apart from contract, altogether non- existent. See Angus v. Clifford, [1891] 2 Ch. 449, and Le Lievrei. Gould, [1893] 1 Q.B. 491.* * But negligence may be the true groimd upon which many American cases are to be explained. See ante, § 200, note. To hold that B is estopped to deny his statements when he is sued is to hold that it is now his duty to make good the loss caused by them. Chap. VI] INNOCENT MISREPRESENTATION 237 to Low the trust fund, subject only to the incumbrances dis- closed in his letters; and, as there were other charges in abund- ance, he would have had to make good the deficiency out of his own pocket. But the court held that the letters upon which Low sought to make Bouverie Uable could not be construed as exph- citly limiting the charges on the trust fund to those specified in the letters. "An estoppel," said Bowen, L.J., "that is to say, the language on which the estoppel is founded, must be precise and unambiguous." ^ Instances of such precise and unambiguous statement may be foimd in the cases of companies which issue certificates stating that the holders are entitled to shares, or to "fully paid up" shares. K the certificate is obtained by means of a deposit with the company of a forged transfer of shares, the company are nevertheless estopped from disputing the title to shares which their certificates confer." ^ (4) Non-disclosure of matenal fact. Contracts uberrimae fidd 213. Contracts affected by non-disclosure. There are some contracts in which more is required than the absence of innocent misrepresentation or fraud. These are contracts in which one of the parties is presmned to have means of knowledge which are not accessible to the other, and is therefore bound to tell him everything which may be supposed likely to affect his judgment. In other words, every contract may be invalidated by material misrepresentation, and some contracts even by non-disclosure of a material fact. Contracts of marine, fire, and Ufe insurance (and indeed, it would seem, contracts of insurance of every kind),* contracts for the sale of land, for family settlements, and for the allotment of shares in companies, are of the special class affected by non- disclosure. To these are sometimes added, in my opinion errone- ously, contracts of suretyship and partnership. 214. Contracts of marine insurance.' The common-law rules a Bloomenthal «. Ford, [1897] A.C. 166; Balkia Co. s. TomkinBon, [1893] A.C. 396. b Seatou v. Heath, [1899] 1 Q.B. 782. The decision of the Court of Appeal in this case was afterwards reversed by the House of Lords, [1900] A.C. 138, on a question of fact as to the materiality of the concealment; but the view expressed by the Court of Appeal that contracts for insurance of all Idnds are within the rule was not dissented from. 1 See Stevens v. Ludlum, (1891) 46 IVIinn. 160; Riclsetts v. Scothorn, (1898) 57 Neb. 51; Denver Fire Ins. Co. v. McClelland, (1885) 9 Colo. 11; Ereeman v. Freeman, (1870) 43 N.Y. 34. ' See Cook on Corp. §§ 365-370. ' "Every fact and circumstance which can possibly influence the mind 238 THE FORMATION OF CONTRACT [Chap. VI upon this subject are now codified in the Marine Insurance Act of 1906." Section 18 of the Act provides that: (1) The assured must disclose to the insurer, before the contract is concluded, every material cbcumstance which b known to the assured, and the assured is deemed to know every cu-cumstance which, in the ordinary course of business, ought to be known by him.' If the assured fails to make such disclosure, the insurer may avoid the contract. (2) Every circumstance is material which would influence the judg- ment of a prudent insurer in fixing the premium or determining whether he will take the risk. In lonides v. Pender goods were insured upon a voyage for an amount largely in excess of their value; it was held that although the fact of over-valuation would not affect the risks of the voy- age, yet, being a fact which underwriters were in the habit of taking into consideration, its concealment vitiated the policy. " It is perfectly well estabhshed that the law as to a contract of insur- ance differs from that as to other contracts, and that a concealment of a material fact, though made without any fraudulent intention, vitiates the policy." '' It will be observed that under the Act the assured is, for pur- poses of communication, "deemed to know" aU circumstances which in the ordinary course of business he ought to know; " and the same rule applies to an agent effecting an insurance for a principal. The agent must disclose everything material that he himself knows or is "deemed to know," as well as everything that his principal is bound to disclose, unless it comes to the knowledge of the principal too late for him to inform the agent. 215. Contracts of fire insurance. The description of the prem- ises appears to form a representation on the truth of which the vaHdity of the contract depends. American authorities go fur- ther than this, and hold that the innocent non-disclosure of any material facts vitiates the policy. In an American case,"* referred a 6 Edw. VII, 0. 41 §§ 17-21. h Per Blackburn, J., in lonides v. Fender, (1874) L.H. 9 Q.B. 537. c 6 Edw. VII, 0. 41 § 19. d New York Bowery Fire Insurance Co. v. New York Fire Insurance Co., (1837 N.Y.) 17 Wend. 359. of the insurer, in determining whether he will underwrite the policy, or at what premimn, is material to be disclosed, and a concealment thereof will vitiate the pohcy." Ely v. Hallett, (1804, N.Y.) 2 Caines, 57; Lewis v. Eagle Ins. Co., (1858, Mass.) 10 Gray, 508; Hart v. British Ins. Co., (1889) 80 Cal. 440; Rosenheim v. Ins. Co., (1862) 33 Mo. 230; Sun Mutual Ins. Co. I). Ocean Ins. Co., (1882) 107 U.S. 485. For relation of salvor and saved on the high seas, see The Clandebove, (1895) 70 Fed. 631. » See Insurance Co. v. Ruggles, (1827, U.S.) 12 Wheat. 408. Chap. VI] INNOCENT MISREPRESENTATION 239 to by Blackburn, J., in the judgment above cited, "the plain- tiffs had insured certain property against fire, and the president of the company heard that the person insuring with them, or at least some one of the same name, had been so unlucky as to have had several fires, in each of which he was heavily insured. The plaintiffs reinsured with the defendants, but did not inform them of this. A fire did take place, the insured came upon the plaintiffs, who came upon the defendants. The judge directed the jury, that if this information given to the president of the plaintiff company was intentionally kept back, it would vitiate the poKcy of reinsurance. The jury found for the plaintiffs, but the court, on appeal, directed a new trial on the ground that the concealment was of a material fact, and whether intentional or not, it vitiated the insurance." ° ' 216. Contracts of life insurance. In The London Assurance v. Mansel * an action was brought to set aside a policy of hfe in- surance on the ground that material facts had been concealed by the party effecting the insurance. He had been asked and had answered questions as follow: Has a proposal ever been made " on your life at other offices.'' If so, where? Waa it accepted at the ordinary premium or at an increased pre- mium or declined? Insured now in two offices for £16,000 at ordinary rates. Policies effected last year. The answer was true so far as it went, but the defendant had endeavored to increase his insurance at one of the offices at which he was already insured, and to effect further insurances at other offices, and in all these cases he had been refused. The contract was set aside, and Jessel, M.R., thus laid down the general principle on which his decision was founded. " I am not prepared to lay down the law as making any difference in substance between one contract of assurance and another. Whether it a (1874) L.R. 9 Q.B. 538. b (1879) 11 Ch. D. 363. 1 Walden v. Louisiana Ins. Co., (1838) 12 La. 134 (non-disclosure); Goddard v. Monitor Ins. Co., (1871) 108 Mass. 56 (innocent misrepresenta- tion). But the doctrine as to non-disclosure does not go so far in fire insur- ance as in marine insurance. Buiritt v. Ins. Co., (1843, N.Y.) 5 Hill, 188; Hartford Prot. Ins. Co. v. Harmer, (1853) 2 Ohio St. 452; Clark v. Ins. Co., (1850, U.S.) 8 How. 235. The insurer may be charged with notice of what he could reasonably discover by inquiry or examination. Continental Ins. Co. V. Kasey, (1874, Va.) 25 Gratt. 268; Insurance Go. v. Leslie, (1890) 47 Ohio St. 409; Short v. Home Ins. Co., (1882) 90 N.Y. 16. 240 THE FORMATION OF CONTRACT [Chap. VI is life, or fire, or marine assurance, I take it good faith is required in all cases, and though there may be certain circumstances, from the pecu- liar nature of marine insurance, which require to be disclosed and which do not apply to other contracts of insurance, that is rather, in my opin- ion, an illustration of the application of the principle than a distinction in principle." " '■ But where A is effecting an insurance on the life of X, and X makes false statements as to his life and habits which A in good faith passes on to the insurance office, such statements have been held not to vitiate a policy. The ground of the decision was (1) that the statements were not condiMons on the truth of which the validity of the contract depended, and (2) that X was not the agent of A for the purpose of effecting the policy, so that the fraud of X was not imputable to A under the rule that the prin- cipal is liable for the fraud of his agent.' " It is possible that if such a case were to occur since equitable remedies for misrepresentation have become general it might be decided otherwise. It precisely corresponds to the case described in Redgrave v. Hurd: ' "where a man having obtained a bene- ficial contract by a statement which he now knows to be false, in- sists upon keeping that contract." But in a later case ^ Vaughan Williams, L.J., expressed his ap- proval of the view taken by Lord Campbell in Wheelton v. Har- disty, that where the assmred "does his best to put the insurer in a situation to obtain the information and to form his own opin- ion that the information is sincere," the policy cannot be avoided by the insurer, if no blame is imputable to the assured himself with regard to the information given. 217. Contracts for the sale of land. In agreements of this na- a London Assurance Co. v. Mansel, (1879) 11 Ch. D. 367. b Wheelton ii. Hardisty, (1857) 8 E. & B. 298. c (1881) 20 Ch. D. 1. d Joel v. Law Union, [1908] 2 K.B. 879. 1 In a somewhat similar case where there were four interrogatories printed under one number, and the insured answered one of them correctly but did not answer the other three, the Supreme Court of the United States held that by issuing the policy the insurer waived the answers to the other three, distinguishing the case cited by the author, and criticising some por- tions of that decision. Phcenix Life Ins. Co. v. Raddin, (1887) 120 U.S. 183. And see Mallory v. Ins. Co., (1871) 47 N.Y. 52. But if there be a misrepre- sentation, however innocent, it avoids the policy, where by the terms of the policy the answers are made material. Cushman v. Ins. Co., (1875) 63 N.Y. 404; Clemans v. Supreme Assembly &c., (1892) 131 N.Y. 485; McCoy ». Metropolitan Ins. Co., (1882) 133 Mass. 82; New York Life Ins. Co. v. Fletcher, (1886) 117 U.S. 519. Cf. Gray v. National Benefit Assoc, (1887) 111 Ind. 631. 2 Penn Ins. Co. v. Bank, (1896) 72 Fed. 413. Chap. VI] INNOCENT MISKEPRESENTATION 241 ture a misdescription of the premises sold or of the terms to which they are subject, though made without any fraudulent intention, will vitiate the contract. In Flight v. Booth," leasehold property was agreed to be purchased by the defendant. The lease contained restrictions against the carrying on of several trades, of which the particulars of sale mentioned only a few. Tindal, C.J., held that the plaintiff could rescind the contract and recover back money paid by way of deposit on the purchase of the property. "We think it is a safe rule to adopt, that where the misdescription, although not proceeding from fraud, is in a material and substantial point, so far affecting the subject-matter of the contract that it may reasonably be supposed that, but for such misdescription, the pur- chaser might never have entered into the contract at all, in such cases the contract is avoided altogether, and the purchaser is not bound to resort to the clause of compensation. Under such a state of facts, the purchaser may be considered as not having purchased the thing which was really the subject of the sale." ^ Molyneux v. Hawtrey ^ is also a case of non-disclosure. A lease was sold by plaintiff to defendant containing onerous and unu- sual covenants. The vendor had not disclosed these covenants nor given to the purchaser a reasonable opportunity for inform- ing himself of them; and the contract could not be enforced. ^ Equitable remedies however can be adapted to the extent and character of the misdescription; " and if this is merely a matter of detail the piu'chaser may be compelled to conclude the sale subject to compensation to be made by the vendor."* ' The parties may also provide in the contract of sale for com- pensation in case of misdescription, and this right, if so ex- pressed, will not merge in the deed of conveyance but may be exercised after the property has passed.* o (1834) 1 Bing. N.C. 370. b [IQOS] 2 K.B. 487. c Pollock (7th ed.), 537-42. d In re Fawoett & Holmes, (1889) 42 Ch. D. 156. ' e Palmer v. Johnson, (1884) 13 Q.B.D. (C.A.) 351. ' The American cases are fully in accord upon the effect of a misdescrip- tion. Rayner v. Wilson, (1875) 43 Md. 440; Stevens ». Giddings, (1878) 45 Conn. 507; King v. Knapp, (1875) 59 N.Y. 462. But, as stated in the prin- cipal case, this is rather because the purchaser does not get what he bargains for, than because the contract is vherrimae fidei. 2 Murphin v. ScoveU, (1889) 41 Minn. 262; McClure v. Trust Co., (1900) 165 N.Y. 108. » King V. Bardeau, (1822, N.Y.) 6 Johns. Ch. 38; Smyth v. Sturges, (1888) 108 N.Y. 495; Towner v. Tickner, (1885) 112 111. 217. The buyer may insist on performance with compensation for defects. Began v. Daughdrill, (1874) 51 Ala. 312; Napier v. Darlington, (1871) 70 Pa. 64; Lancaster v. Roberts, (1893) 144 111. 213. 242 THE FORMATION OF CONTRACT [Chap. VI Contracts preliminary to family settlements need no special illustration. 218. Contracts for the purchase of shares in companies. The rule as to the fullness of statement required of projectors of an undertaking in which they invite the pubhc to join is clearly stated by Kindersley, V.C., in the case of the New Brunswick Railway Company v. Muggeridge,'^ in words which were approved by Lord Chelmsford in a later case in the house of Lords: * "Those who issue a prospectus holding out to the public the great advantages which wiU accrue to persons who will take shares in a pro- posed undertaking, and inviting them to take shares on the faith of the representations therein contained, are bound to state everjrthing with strict and scrupulous accuracy, and not only to abstain from statiog as fact that which is not so, but to omit no one fact within their knowledge the existence of which might in any degree affect the nature, or extent, or quality of the privileges and advantages which the prospectus holds out as inducements to take shares." ' la another case Lord Cairns points out the distinction be- tween fraud and such innocent misrepresentation as makes a contract of this nature voidable. He intimates that mere non- disclosure can never amount to fraud unless accompanied with such substantial representations as give a false air to facts, but that "it might be a ground in a proper proceeding and at a proper time for setting aside an allobment