a 7? 
 
 Cornell University Law Library. 
 
 THE GIFT OF 
 
 (^^^^ ^r-J^J^Or-^^^^ 
 
 Date. 
 
 ,3,./^^/ 
 
 9181 
 
Cornell University Library 
 KF 801.A7C79 
 
 Cases on the law of contracts, selected f 
 
 3'''"l'924"0l'8'824 973 
 
Cornell University 
 Library 
 
 The original of this bool< 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/cu31924018824973 
 
'i'l\X-^'' 
 
 CASES 
 
 ON 
 
 THE LAW OF CONTRACTS 
 
 SELECTED FROM DECISIONS OF 
 
 ENGLISH AND AMERICAN COURTS 
 
 V ■ \ 
 
 V . 
 
 BY ARTHUR L. CORBIN 
 
 HOTCHKISS PEOFESSOR OF LAW IN TAtB UNIVERSITY 
 
 AMERICAN CASEBOOK SERIES 
 WILLIAM R. VANCE 
 
 GENERAL EDITOR 
 
 ST. PAUL 
 
 WEST PUBLISHING COMPANY 
 
 1921 
 
>';« ..V'''' I' 
 
 THE AMERICAN CASEBOOK SERIES / 
 
 The first of the American Casebook Series, Mikell's Cases on Crim- 
 inal Law, issued in December, 1908, contained in its preface an able 
 argument by Mr. James Brown Scott, the General Editor of the Se- 
 ries, in favor of the case method of law teaching, Until 1915 this 
 preface appeared in each of the volumes published in' the series. 
 But the teachers of law have moved onward, and the argument 
 that was necessary in 1908 has now become needless. That such 
 is the case becomes strikingly manifest to one examining three im- 
 portant documents that fittingly mark the progress bf legal education 
 in America. In 1893 the United States Bureau of Education pub- 
 lished a report on Legal Education prepared, by the American Bar As- 
 sociation's Committee on L^gal Education,^ and manifestly the work 
 of that Committee's accomplished chairman, William G. Hammond, 
 in which the three methods of teaching law then in vogue — that is, by 
 lectures, by text-book, and by selected cases — were described arid com- 
 mented upon, but without indication of preference. The next report 
 of the Bureau of Education dealing with legal education, published 
 in 1914, contains these unequivocal statements: 
 
 "To-day the case method forms the principal, if not the exclusive, 
 method of • teaching in nearly all of the stronger law schools of the 
 country. Lectures on special subjects are of course still delivered in 
 all law schools, and this doubtless always will be the case. But for 
 staple instruction in the important branches of common law the ■ case 
 has proved itself as the best available. material' for use practically ev- 
 erywhere. * * * The case method is to-day the principal method 
 of instruction in the great majority of the schools of this country." 
 
 But the most striking evidence of the present stage of development 
 of legal instruction in American Law Schools is to be found in the 
 special report, made by Professor Redlich to the Carnegie Foundation 
 for the Advancement of Teaching, on "The Case Method in American 
 Law Schools." Professor Redlich, of the Faculty of Law in the Uni- 
 versity of Vienna, was brought to this country to make a special study 
 of methods of legal instruction in the United- States from the stand- 
 point of one free from those; prejudices necessarily engendered in 
 American teachers through their relation to' the struggle for supi-emacy 
 so long, and at one time so vehemently, waged among the rival"sys-. 
 tems. From this masterly report, so replete with brilliant- analysis 
 and discriminating comment,- the 'following brief e^tfacts are taken. 
 Speaking of the text-book method Professor RedHch says:'' 
 ■ "The principles are laid^ down in the text-book and in the) profes- 
 sor's lectures, ready made and neatly rpunded,' the predigested essence^ 
 
 (iil) 
 
IV PREFACE 
 
 of many judicial dedsions. The pupil has simply to accept them and 
 to inscribe them so, far as possible' in his memory. In this way the 
 scientific elerhent of instruction is apparently excluded from the very 
 first. Even though the representatives of thip instruction certainly do 
 regard law as a science — tliat is to say, as a system of thought, a group- 
 ing of concepts to be satisfactorily explained by historical research and 
 logical deduction — they are not willing to teach this science, but only 
 its results. The inevitable danger which appears to accompany this 
 method of teaching is that of developing a mechanical, superficial in- 
 struction in abstract maxims, instead of a genuine intellectual, probing 
 of the subject-matter of the law, fulfilling the requirements of a 
 science." 
 
 Turning to the case method Professor Redlich comments as follows : ; 
 
 "It emphasizes the scientific character of legal thought; it goes now 
 a step further, however, , and demands that law, just because it is a 
 science, must also be taught scientifically. From this point of view it 
 very properly rejects the elementary school type of existing legal edu- 
 cation as inadequate to develop the specific legal mode of thinking, as 
 inadequate to make the basis, the logical foundation, of the separate 
 legal principles really intelligible to the students. Consequently, as the 
 method was developed, it laid the main emphasis upon precisely that 
 aspect of the training which the older text-book schopl entirely neg- 
 lected — the training of the student in intellectual independence, in in- 
 dividual thinking, in digging out the principles through ; penetrating 
 analysis of the material found within separate cases,; material which 
 contains,, all mixed in with one another, both the facts, as life creates, 
 them, which generate the law, and at the same time rules of the law 
 itself, component parts of the general system. In the fact that, as has 
 been said before, it has actually accomplished this purpose, lies the 
 great success of the case method. For it really teaches the pupil to 
 think in the way that any practical lawyer— whether dealing with writ^ 
 ten or with unwritten law— ought to and has to think. It preparers the 
 student in precisely the way which, in a country of case law, leads to 
 full powers of legal understanding and legal acumen ; that is to say, 
 by making the law pupil familiar with the law through incessant prac- 
 tice in the analysis of law cases, where the concepts, principles, and 
 rules of Anglo-American law are recorded, not as dry abstractions, but 
 as , cardinal realities in -the inexhaustibly rich, ceaselessly, fluctuating, 
 social and economic life of man. Thus in the modern American law 
 school professional practice is preceded by a genuine course of study, 
 the methods of which are perfectly adapted to the nature of the com- 
 mon law." 
 
 The general purpose and scope of this series were clearly stated in 
 the original announcement : 
 
 "The General Editor takes pleasure in announcing a series of schol- 
 arly casebooks, prepared with special reference.to the needs and limi- 
 
PREFACE V 
 
 tations of tine elassroom, on the fundamental subjects of legal educa- 
 tion, which, through a judicious rearrangement of emphasis, shall pro- 
 vide adequate training combined with a thorough knowledge of the 
 general principles of the subject." The collection will develop the law 
 historically and scientifically; English cases will give the origin and 
 development of the law in England ; American cases will trace its ex- 
 pansion and modification in America ; notes and annotations will sug- 
 gest phases omitted in the printed case. Cumulative references wiU be 
 avoided, for the footnote may not hope to rival the digest. The law 
 will thus be presented as an organic growth, and the necessary con- 
 nection between the past and the present will be obvious. 
 
 "The importance and difficulty of the subject as well as the time that 
 can properly be devoted to it will be carefully considered so that each, 
 book may be completed within the time allotted to the particular sub- 
 ject. * * * If it be granted that all, or nearly all,' the studies re^ 
 quired for admission to the bar should be studied in, course by every 
 student — and the soundness of this contention can hardly be seriously 
 doubted — it follows necessarily that the preparation and publication of 
 collections of cases exactly adapted to the purpose would be a genuine 
 and by no means unimportant service to the cause of legal education. 
 And this result can best be obtained by the preparation of a systematic 
 series of casebooks constructed upon a uniform plan under the super- 
 vision of an editor in chief. * * * . 
 
 "The following subjects are deemed essential in that a knowledge of 
 them (with the exception of International Law and General Juris- 
 prudence) is almost universally required for admission to the bar : 
 
 Administrative Law. Equity Pleading. 
 
 Agency. Evidence. 
 
 Bailments. Insurance. 
 
 Bills and Notes, International Law. 
 
 Carriers. Jurisprudence. 
 
 Code Pleading. Legal Ethics. 
 
 Common-Law Pleading. Partnership. 
 
 Conflict of Laws. Personal Property. 
 
 Constitutional Law. Public Corporations. 
 
 Contracts. Quasi Contracts. 
 
 Corporations. Real Property. 
 
 Criminal Law. Sales. 
 
 Criminal Procedure.' Suretyship. 
 
 Damages. Torts. 
 
 Domestic Rdations. Trusts. . 
 
 Equity. Wills and Administration. 
 
 "International Law is included in the list of essentials from its in- 
 trinsic importance in our system of law. As its principles are simplft 
 in comparison with municipal law, as their applicatiori is less technical, 
 
VI PRfeFAtJE 
 
 and as the cases are generally interesting, it is thought that the book 
 may be larger than otherwise would be the case. 
 
 "The preparation of the casebooks has been intrusted to experienced 
 and well-known teachers of the various subjects included, so that the 
 experience of the classroom and the needs of the students v/ill furnish 
 a sound basis of selection." 
 
 Since this announcement of the Series was first made there have 
 been ptiblished books on the following subjects : 
 
 Administrative Law. By Ernst Freund, Professor of Law in the 
 University of Chicago. 
 
 Agency. By Edwin C. Goddard, Professor of L,aw in the University 
 of Michigan. 
 
 BiUs and Notes'. By Howard L. Smith, Professor of Law in the Uni- 
 versity of Wisconsin, and Underbill Moore, Professor of Law in 
 Columbia University. 
 
 Carriers. By Frederick Green, Professor of Law in the University of 
 Illinois. 
 
 Conflict of Laws. By Ernest G. Lorenzen, Professor of Law in 
 Yale University. 
 
 Constitutional Law. By James Parker Hall, Dean of the Faculty of 
 Law in the University of Chicago. 
 
 Contracts. By Arthur L- Corbin, Professor of Law in Yale University. 
 
 Corpwations. By Harry S. Richards, Dean of the Faculty of Law in 
 the University of Wisconsin. 
 
 Criminal Law. By William E. Mikell, Dean of the Faculty of Law in 
 the University of Pennsylvania. 
 
 Criminal Procedure. By William E. Mikell, Dean of the Faculty of 
 Law in the University of Pennsylvania. 
 
 Damages. By Floyd R. Mechem, Professor of Law in the University 
 of Chicago, and Barry Gilbert, of the Chicago Bar. 
 
 Equity. By George H. Boke, Professor of Law in the University of 
 Oklahoma. 
 
 Evidence. By Edward W. Hinton, Professor of Law in the Universi- 
 ty of Chicago. 
 
 Insurance. By William R. Vance, Professor of Law in Yale Uni- 
 versity. 
 
 International Law. By James Brown Scott, Professor of International 
 Law in Johns Hopkins U^niversity. 
 
 Legal Ethics, Cases and Other Authorities on. By George P. Costigan, 
 Jr., Professor of Law in Northwestern University. 
 
 Partnerships By Eugene A. Gilmore, Professor of Law in the Uni- 
 versity of Wisconsin. 
 
PREFACE Vll 
 
 Persons (including Marriage and Divorce). By Albert M. Kales, of 
 
 the Chicago Bar, and Chester G. Vernier, Professor of Law in 
 
 Stanford University. 
 Pleading {Common Law). By Clarke B. Whittier, Professor of Law 
 
 in Stanford University, and Edmund M. Morgan, Professor of 
 
 Law in Yale University. 
 Property (Titles to Real Property). By Ralph W. Aigler, Professor 
 
 of Law in the University of Michigan. 
 Property {Personal). By Harry A. Bigelow, Professor of Law in the 
 
 University of Chicago. . ' 
 
 Property (Rights in Land). By Harry A. Bigelow, Professor of 
 
 Law in the University of Chicago. 
 Property (Wills, Descent, and Administration). By George P. Costi- 
 
 gan, Jr., Professor of Law in Northwestern University. 
 Property {Future Interests). By Albert M. Kales, of the Chicago 
 
 Bar. 
 Quasi Contracts. By Edward S. Thurston, Professor of Law in Yale 
 
 University. 
 Sales. By Frederic C. Woodward, Professor of Law in the University 
 
 of Chicago. 
 Suretyship. By Crawford D. Hening, formerly Professor of Law 
 
 in the University of Pennsylvania. 
 Toxts. By Charles M. Hepburn, Dean of the Faculty of Law in the 
 
 University of Indiana. 
 Trusts. By Thaddeus D. Kenneson, Professor of Law in the Univer- 
 sity of New York. 
 
 It is earnestly hoped and believed that the books thus far published 
 in this series, with the sincere purpose of furthering scientific training 
 in the law, have not been without their influence in bringing about a 
 fuller understanding and a wider use of the case^piethod. 
 
 WiLi<iAM R. Vance, 
 
 General Editor. 
 Juke, 1921. 
 
AUTHOR'S PREFATORY NOTE 
 
 No STUDENT or teacher should suppose that he can learn the law of 
 contracts frOm one casebook or one text-book. If the law consisted of 
 one set of rules, consistent, uniform, and logically constructed, the au- 
 thor's problem and the student's problem would be greatly simplified, 
 though less interesting. The law is not such a set of rules, and it 
 must be taught as it is — inconsistent, variable, illogical, growing and 
 changing with the growth of civilization. As the mores change, the 
 prevailing notions of social and economic welfare, the conscious and 
 unconscious customs of men, the practices of business affairs, even as 
 the notions of individual groups and of individual men ciiange, so also 
 change the stated rules of law. It has long been impossible to present 
 the story of this growth of Anglo-American contract law in one 
 volume. What was the law prior to the year 1300 as put into Latin 
 by Braeton? What is its tortuous path in Anglo-Latin-French during 
 the centuries of the Year Books (1300-1550)? What are the rules 
 laid down by our industrious reporters in the English tongue, from 
 Plowden to Meeson and Welsby (1550-1850)? What are our Amer- 
 ican courts going to decide to-morrow? 
 
 The purpose of the present casebook is to afford introductory mate- 
 rial for answering the last question. Even as such an introduction, it 
 cannot fail to seem inadequate. There are too many jurisdictions, 
 too great a conflict, too great a complexity of affairs, too industrious 
 a production of opinions, for any volume to give full satisfaction. It 
 is indeed true that the last question cannot be answered without an- 
 swering all the preceding ones and more. Yet the present volume offers 
 no material as early as Braeton ; it presents only a small amount from 
 the Year Books ; and even the period of the English reporters is sac- 
 rificed to include more cases from the recent past. It is hoped that 
 enough of the earlier material has been included to indicate continuity 
 of legal history and to prove that the future is influenced by the re- 
 mote as well as by the recent past. But student and teacher must go 
 elsewhere for knowledge of the earliergeriods. Bracton's age must be 
 left to the historical scholar. The Year Books can and should be read 
 for themselves. For the period between 1550 and 1850, it will generally 
 be sufiEcient to study the two volumes of cases published by Langdell. 
 To supplement the present volume as to present-day law, there are 
 other excellent collections of cases and there are the amazing digests 
 and the labyrinthine libraries. Some footnotes have been added to as- 
 
 (ix) 
 
X PREFACE 
 
 sist in making further independent investigation ; they are not intended 
 to make such investigation unnecessary. 
 
 Of the 594 cases in the present volume, 258 have been decided since 
 1900, 224 between 1800 and 1899, and 112 prior to 1800; 185 cases are 
 English, while 409 represent the federal courts and 39 different 
 states in the Union. An effort has been made not to neglect leading 
 cases that are commonly cited as having first laid down or established 
 an important rule of law. At least one-fourth of the cases herein 
 will also be found in earlier casebooks on the subject. 
 
 The order of arrangement has been chosen with the purpose of mak- 
 ing the; topics and the individual cases most readily understood by the 
 beginning student. Teachers frequently disagree as to the ipost desir- 
 able order ; but it is not difficult to rearrange topics to suit individual 
 taste. 
 
 One cannof use a particular casebook in his law school courses for 
 more than 15 years without being greatly influenced by both the choice 
 of cases and the order of their arrangement. For this reason the 
 present writer will be found greatly indebted to Professor Samuel 
 Williston, and through, him to his predecessors. Professors Ames and 
 Langdell. Acknowledgment is also due to the work of Professor 
 Keener. The very special debt owed to Professor Hohfeld is shown, 
 not so much in the construction of the casebook as in the critical anal- 
 ysis and comparison of tl^ classroom. Hohfeld's articles on "Some 
 Fundamental Legal Relations as Applied in Judicial Reasoning," 23 
 Yale Law Journal, 16 (1913)>and 26 Yale Law Journal, 710 (1917), 
 reveal new possibilities for constructive work to every student of the 
 law. Acknowledgment is also made to the Oxford University Press 
 for its permission to make use of the notes in the writer's edition of 
 Anson on Contracts, published in 1919. 
 
 Arthur L. Corbin 
 Xalb University School ov Law, 
 March, 1921. 
 
TABLE OF CONTENTS 
 
 Section 
 
 CHAPTER I 
 
 Offeb and Acceptance 
 
 Page 
 
 1. inoperative Preliminary Negotiation 1 
 
 2. Communication of Offer 17 
 
 3. Acceptance by Post 27 
 
 4. Acceptance by Oyert Act 52 
 
 5. When Notice of Acceptance is Required 60 
 
 6. Silence as Acceptance 80 
 
 7. Conditional Acceptance and Rejection &4 
 
 8. Meeting of the Minds — ^Mistake 112 
 
 9. Lapse of Offer — Power of Revocation 141 
 
 CHAPTER II 
 
 Consideration 
 
 1. Early Development 206 
 
 2. Reliance on a Promise as Consideration ,222 
 
 3. Forbearance as Consideration 252 
 
 4. Mutual Promise? as Consideration for Each Other 292 
 
 5. Performance of Pre-existing Legal Duty 320 
 
 6. Past Consideration 387 
 
 CHAPTER III 
 
 CONTBACTS UKDEE SEAL 455 
 
 CHAPTER IV 
 
 Opebation of Contract and of Facts Subsequent to Acceptance 
 
 1. Express Conditions Precedent 480 
 
 2. Implied and Constructive Conditions Precedent 504 
 
 (a) Their Historical Development — Dependent and Independent 
 
 Promises , 504 
 
 Cb) Partial Failure of Performance.^ 533 
 
 (c) Installment Contracts jt. 550 
 
 (d) Performance on Time as a Condition 606 
 
 (e) Contracts of Service 617 
 
 (f) Certificate of Architect or Engineer 628 
 
 (g) Substantial Performance as Fulfillment of Condition 647 
 
 (h) Condition of Personal Satisfaction 661 
 
 (I) Condition of Notice 680 
 
 (j) Conditions in Aleatory Contracts 6g5 
 
 (k) Charter Parties — Leases 692 
 
 CORBIX CONT. Ui) 
 
Xll TABLE OP CONTENTS 
 
 Section Page 
 
 3. Conditions Subsequent — Pleading and Burden of Proof of Condi- 
 
 tions 702 
 
 4. aElepudiation 729 
 
 (a) Effect on the Otlier Party's Duty of Performance and on the 
 
 Conditional Character of his Right 729 
 
 (b) Anticipatory Repudiation as a Cause of Action 742 
 
 (c) Measure of Damages — Mitigation of Damages 784 
 
 5. Prevention of Performance and Waiver, of Conditions 807 
 
 (a) Prevention of Performance 807 
 
 (b) Waiver of Conditions. 823 
 
 6. Impossibility 842 
 
 CHAPTER V 
 
 DiSCHAEGE OP CO'NTBACT 
 
 1. Release and Covenant Not to Sue 928 
 
 2. Surrender and Cancellation 945 
 
 3. Parol Exoneration and Rescission. . ^ 948 
 
 4. Payment or Tender Thereof 957 
 
 5. Novation — Substituted Contract 959 
 
 6. Accord Executory — Accord and Satisfaction 979 
 
 7. Discharge of Specialties 1020 
 
 8. Alteration 1026 
 
 9. Arbitration find Award — Merger 1030 
 
 CHAPTER VI 
 Thibd Party BbneficiaeIes ; 1040 
 
 V 
 
 CHAPTER VII 
 Assignment 1111 
 
 CHAPTER VIII 
 Joint Conteacts ^ 1186 
 
 CHAPTER IX 
 
 Illegal Contracts 
 
 1. Restraint of Trade .•'.'' 1206 
 
 2. Wagering Conl^^acts 1257 
 
 3. Champerty and Maintenance 1273 
 
 4. Agreements to Stifle a Prosecution , . 1289 
 
 5. Agreements Ousting the Courts of JurisiMctiou 1294 
 
 6. Contracts AfEecting Marriage. . . . ; 1313 
 
 7. Sunday Laws 1320 
 
 8. Contracts Inducing Crime or Private Wrong 1322 
 
 9. Conducting Business without a License 1357 
 
 10. Contracts in Aid or vnth Knowledge of lUfegal Purpose 1363 
 
 11. Contracts Illegal in Part. , 1372 
 
TABLE OF CONTENTS Xlll 
 
 CHAPTER X 
 
 The Statute of Fbatjds 
 
 Section Page 
 
 1. Contracts of Guaranty 1375 
 
 2. Contracts in Consideration of Marriage 1394 
 
 3. Contracts for the Sale of Land 139T 
 
 4. Contracts Not to be Performed WitMn One Tear. . , . . . 1414 
 
 5. Contracts for the Sale of Goods 1430 
 
 6. The Character of the Memorandum Required 1443 
 
 7. The Legal Operation of the Statute 1464 
 
TABLE OF CASES 
 
 Cases printed in oi-dinary type are tlie cases reported as the text of this 
 volume. Cases printed in italics are found in the footnotes and in text ; they 
 are included in this table either because they are stated and discussed, or 
 because they are printed in other casebooks and have become known to many 
 teachers and students, who will thus be enabled to use this table as a supple- 
 mentary index. 
 
 Page 
 
 Abbott V. Doane 371 
 
 Aclcert v. Barker 12Y6 
 
 Adams V. Lindsell 27 
 
 Adams v. Merced Stone Co 1135 
 
 A-dams Radiator & Boiler Works 
 
 V. Schnadef 673 
 
 Adamson v. Paonessa 1146 
 
 A. D. Granger Co. v. Brown- 
 
 Ketcham Iron Works 840 
 
 Ahearn v. Ayres 7 
 
 Alden v. Blague 1020 
 
 -rAllen V. Bryson 399 
 
 A lien V. Burns 841 
 
 All&n V. Harris 982, 992 
 
 Allen V. MUner 1032 
 
 --Aller V. Aller 471 
 
 Alliance Bank v. Broom ; 265 
 
 American Bridge Co. of New 
 
 York V. Boston 1139 
 
 Ame'rican Publishing d Engra/eing 
 
 Co. V. Walker. .. , 190 
 
 American Smelting & Reflning Go. 
 .V. Bunker Hill & Sullivan Min- 
 ing <& Concentrating Go 1170 
 
 Anchor Electric Co. v. Hatokes . . 1222 
 
 Anderson v. Martindale 1206 
 
 ^^nderson v. May 899 
 
 Anderson v. Nichols 1204 
 
 Anderson v. Odd Fellows' Hall of 
 
 Jersey City 48-1 
 
 Andrew v. Boughey 504 
 
 Andrews Electric Co. v. St. Al- 
 phonse Catholic Total Absti- 
 nence Soc 1155 
 
 .^-Anhquser-Busoh Bremng Ass'n v. 
 
 Mason 1369 
 
 Anonymous 60, 207, 465, 
 
 680, 696, 807, 1041 
 
 Anthonv Main (Sir) Case of 731 
 
 Anthony Sturlyn (Sir) v. Albany 212 
 
 .'-Arend v. Smith. 374 
 
 Arkansas Valley Smelting Co. v. 
 Belden Mining Co 1166 
 
 Page 
 
 Arnold v. 'Nichols 1055, 1107 
 
 Atkins V. Hill 388 
 
 Atkins V. Johnson. . . ., 1322 
 
 Attorney General v. Supreme 
 
 Council A. L. H 947 
 
 Audette v. L'Union St. Joseph... 489 
 
 Austin V. Burge 85 
 
 Averill v. Hedge 145 
 
 Ayer v. Western ITnion Tel. Co. . . 118 
 
 Bahcock v. Hawkins 974 
 
 Babington v. I/ambert 388 
 
 Bagge V. Slade 361 
 
 Bailey v. Marshall 1384 
 
 Bailey v. Sweeting 1458 
 
 Baily v. De Crespigny 902 
 
 Bavkbridge v. Firmstone 211 
 
 Baird v. Salina Northern R. Co. . 1339 
 
 Baldwin v. Williams 1435 
 
 Bandman v. Finn 966 — 
 
 Barker v. Bucklin 1054 
 
 Barker v. Heath 423 
 
 Barnard v. Simons 268 
 
 Barnes v. Hedley. 426 
 
 Barnett Foundry Go. v. Groire.. 535 
 
 Bassett v. Hughes 1103 
 
 Bates V. Babcock 1411 
 
 Batterbury v. Vy.ie 813 
 
 Beaumont v. Frieto 94 
 
 Beck & Pauli Mthographing Co. 
 V. Colorado Milling & Elevator 
 
 Co 606 
 
 Beckwith v. Talbot 1458 
 
 Beecham v. Smith 1186 
 
 Beecher v. Gonradt 522, 557 
 
 Behn v. Bumess 696 
 
 Belknap v. Bender , . . . . . .1.391 
 
 Benanti v. Delaware Ins. Co 707 
 
 Benson v. Phipps '. . , . 342 
 
 Bentley v. Morse .'. 448 
 
 Berg v. Erickson. :\ 924 
 
 Bettini v. Gye 621 
 
 Bidder v. Bridges 332 
 
 . COBBIN CONT. 
 
 (XV) 
 
XVI 
 
 TABLE OP CASES 
 
 Page. 
 
 Bidwell V. Catton 269 
 
 Billings V. Wilby 14 
 
 BUlington v. Cahill.... ...1429 
 
 Binnington v. Wallis ......; 449 
 
 Birch V. Baker 1464 
 
 Bisbee v. McAllen 1358 
 
 -Bishop V. Eaton 73 
 
 -Bishop V. Palmer 1217 
 
 Blackburn v. ReUly 582 
 
 -Blaisdell v. Ahern 1275 
 
 Blalcs, Case of ,. .1021 
 
 Blandford v. Andrews.... 808 
 
 Blewitt V. Boorum 467 
 
 Blonnt V. Wheeler 280 
 
 Board of Education of District of 
 
 Northfork v. Angel 1291 
 
 Bohanan v. Pope 1054, 1110 
 
 Boone V. Eyre 533 
 
 Booth V. Eighmie .1379 
 
 Borden v. Boardman 1055, 1074 
 
 Borrovmtan v. Free. 777 
 
 Bosden v. Sir John Thinne 391 
 
 Boston Ice Co. v. Potter 130 
 
 Boston & M. R. B. v. Bartlett. . . 166 
 
 Bowden v. Bowden .1315 
 
 BowAitoh V. New England Mut. 
 
 Life Ins. Co 1371 
 
 Bowman v. Berkey 1028 
 
 Brackenbury v. Hodgkin 191 
 
 Brackett v. Knowlton 808 
 
 Braden v. Ward 928 
 
 Bradley v. Burwell 1194 
 
 Bradshaw, Case of 1111 
 
 Braniff v. Baier 197 
 
 Brawn v. Lyford 228 
 
 Brewster v. Banta 428 
 
 Brice v. Bammster 1124, 1173 
 
 Bridge v. Cage 381 
 
 Bridgeford & .Co. v. Meagher .... 664 
 British Wagon Co. v. Lea & Co.. 1162 
 
 Broad v. Jollyfe ; . . 1206 
 
 Broadwell v. Getman 1422 
 
 Broeas, Case of 505 
 
 Brogden v. Metropolitan R. Go. . . 16 
 
 Brookbank v. .Taylor 682 
 
 Brooks V. Ball 213, 235 
 
 Brown v. Foster 662 
 
 Bruce v. Pearson 99 
 
 Burk V. Schreiber 859 
 
 Bumes V. Scott 1286 
 
 Bute V. Thompson. 887 
 
 Butler V. San Francisco Gas & 
 
 Electric Co. .1173 
 
 Bvrne & Co. v. Van Tienhoven & 
 
 Co 168 
 
 Cadwell v. Blake 722 
 
 Cahen v. Piatt 584 
 
 Callisher v. Bischoffsheirn 283 
 
 Callonel v. Briggs 512 
 
 Camp T. Tompkins * . . 1116 
 
 Canda v. Wick 734 
 
 Caporale v. Rubine 844 
 
 Page 
 Carleton v. Floyd, Rounds & Oo..l391 
 Carlill V. Carbolic Smoke Ball Co. 64 
 
 -Oarpepter v. Murphy 1472 
 
 Oarr f : Maine Cent. R. R 231 
 
 Carroll v. Bowersock 906 
 
 Carshore v. Huyck 418 
 
 Carter & Moore v. tTnifed Ins. Co. 
 
 of New York 1125 
 
 Gase V. Barber. . . . .'. j 982 
 
 Catholic Foreign Mission Soc. of 
 
 America v. Ouassani 838 
 
 Cator V. Burke 1125 
 
 Cavanaugh v. Jackson, 1414 
 
 Central Shade-Roller Go. v. Cnsh- 
 
 man 1222 
 
 Centrat Trust Co. of Illinois v. 
 
 Chicago Auditorium Ass'n 750 
 
 O. G. Davis & Co. v. Bishop 897 
 
 Challenge Wind & Feed Mill Co. 
 
 V. Kerr . . . , 187 
 
 Chamberlain v. Staunton 464 
 
 Chambers v. Atlas Ins. Co 702 
 
 Chandler v. Webster. 910 
 
 Cherry v. Heming 1435 
 
 Chicago & G. E. R. Co. v. Dane. . 300 
 
 Choice V. City of Dallas 24 
 
 Christie v. Borelly 686 
 
 Christie v., Borelly. 296 
 
 Church V. Proctor 1324, 1371 
 
 Clark V. Gulesian .- . 514 
 
 Clark V. Hovey 810 
 
 Clark V. Jones 417 
 
 Glarh v. Marsiglia 793 
 
 Clark V. West 826 
 
 Clarke v. Watson 633 
 
 Clarksville Land Go. v. Ilarrlman 924 
 
 demons v. Meadoios 1239 
 
 Clifford (Lord) v. Watts 886 
 
 Coggs V. Bernard 211 
 
 Cohn V. Levine 300. 
 
 Cole-Molntyre-Norfleet Co. v. Hol- 
 
 loway 90 
 
 Coleman v. Eyre 295 
 
 Collamer v. Day 1257 
 
 Collins V. Locke 1246 
 
 Collins V. Wills .'..1322 
 
 Collyer v. Moulton 956 
 
 Gommings v. Beard 1032 
 
 Commonwealth v. Overby 902 
 
 Coniers and Holland, Case of . . . . 949 
 Consolidated Portrait & Frame 
 
 Co. y. Barnett 184 
 
 Constable v. Clobery ,480 
 
 Cook V. Songat 293 
 
 Cooli( V. Wright 274 
 
 Cooke V. Oxley 165 
 
 Coo^nbe v. Greene 507 
 
 Cope V. Rowlands ; 1358 
 
 Coplew V. Durand 636 
 
 Corbett v. Cochran 065 
 
 Cart V. Ambergate, etc., R. Go 735 
 
 Couturier v. Hastie. .1391 
 
 Oowan V. Milbourn. 1371 
 
TABLE OF CASES 
 
 XVll 
 
 Page 
 
 Ootoley V. Patch 1200 
 
 Craig V. Lane 823 
 
 Crisp V. Gamel , . 220 
 
 Cronin v. Chelsea Sav. Bank 1132 
 
 Crouch V. Martin 1111 
 
 Crouch V. Martin & Harris 112T 
 
 Crowther v. Farrer 999 
 
 Crumlish's Airni'r v. Central Imp. 
 
 Go 1016 
 
 Cummmgs v. Union Blue Stone 
 
 Go 1239 
 
 Cundy v. lAndsuy 130 
 
 Gti/rtis V. Brown 1378 
 
 Ousack V. Robinson 1440 
 
 G. W. Bull Co. V. Marquette Ce- 
 ment Mfg. Co ^. . 108 
 
 Daniels v. Newton 755 
 
 Davidson v. Cooper 1028 
 
 Da vies v. Warner 260 
 
 Davis V. PatrioTc 1391 
 
 Davis V. Van Buren 1193 
 
 Davis V. Wells 76 
 
 Davis Sewiiig Mach. Co. v. Rich- 
 ards 76 
 
 Davis & Co. V. Bishop 897 
 
 Davis & Co. V. Morgan 344 
 
 Davrkins v. Sai5pington 18 
 
 Day V. Oaten 83 
 
 Day V. MoLea 1010 
 
 Dearie v. Hall 1149 
 
 De Cicco V. Schweizer 376 
 
 Deering v. Farrington 1122 
 
 t)e Long V. Zeto 874 
 
 Derby v. Phelps 1396 
 
 Dermott v. Jones 917 
 
 Devecmon v. Shaw 234 
 
 Devlin v. New York 1158 
 
 Dewey v. ,Alphena School Dist. . . 926 
 
 Dexter v. Blanchard 1377 
 
 Diamond Match Co. v. Roeber . . . 1208 
 
 Dickinson v. Dodds 174 
 
 Dienst v. Dienst 1394 
 
 Dietrich v. ffoefelmeir 1425 
 
 Dingley v. Gler 750 
 
 Dixon V. Clark 958 
 
 Doclc v. Boyd 1391 
 
 Dr. Miles Medical Go. v. John D. 
 
 Park d Sons Co .M212, 1256 
 
 Doherty v. HUl 1449 
 
 Doll v. NoUe 676 
 
 Donnell v. Manson 1201 
 
 Donnelly v. Currie Hardware Co. 14 
 
 Doolittle v. Callender 58 
 
 Dowdenay v. Oland . . ., 261 
 
 Dowse V. Jefferies 936 
 
 r>6yle V. Dixon 1417 
 
 Drlggs V. Bush 1440 
 
 Drury, Case of 928 
 
 Dunlop V. Eiggins 32 
 
 Dunton v. Dunton 235, 254 
 
 Duplex Safety Boiler Co. v. Gar- 
 den 675 
 
 OOEBIN CONT. — b 
 
 Page 
 
 Du Pont de Nemours Powder Co. 
 
 V. Schlottman .' 818 
 
 Dmnherr v. Rau 1058,1082,1094 
 
 Dustan v. McAndreios 794 
 
 Dutton V. Poole 1041 
 
 Duval V. Wellman 1315 
 
 Eames v. Preston , . . . . 463 
 
 Earle v. Oliver 437 
 
 Early v. Mahon 425 
 
 Eastwood V. Kenyon 393, 1380 
 
 Ebert v. Haskell 1344 
 
 Eddy V. Davis 557 
 
 E4ge v. Boileau 699 
 
 Edge Moor Bridge Works v. Bris- 
 tol County 165 
 
 Edgerly v. Shaw 410 
 
 Edmonds, Case of . . . 405 
 
 Edmunds v. Merchants' Despatch 
 
 Transp. Co. 130 
 
 Edmundson's Estate, In re 1066 
 
 Edson v. Poppe 400 
 
 Edwards v. Chapman 949 
 
 Edwards v. Weeks 949 
 
 Edwards & Sons v. Farve 1418 
 
 E. I. Du Pont de Nemours Powder 
 
 Co. V. Schlottman 818 
 
 Eliason v. Henshaw 49 
 
 Ellen v. Topp 539 
 
 Elliott V. Blake 721 
 
 Ellis V. Frawley 1278 
 
 Elton Cop Dyeing Co. v. Robert 
 
 Broadbent & Son 974 
 
 Embry v. Hargadlne-McKlttrick 
 
 Dry Goods. Co 114 
 
 Emery v. Ohio Candle Co 1239 
 
 Empire Trans. Co. v. Philadel- 
 phia & R. Coal & Iron Co 920 
 
 England v. Davidson 386 
 
 Erie R. Co. v. Union Locomotive 
 
 ,& Express Co 1374 
 
 Estabrook v. Wilcox 1397 
 
 Evans v. Boare 1449 
 
 Evans v. Oregon & W. R. Co 359 
 
 Evans v. Supreme Council of 
 
 Royal Arcanum 873 
 
 Evans Piano Co. v. TuUy 88 
 
 FaArlie v. Denton 965 
 
 Falck V. Williams 118 
 
 Fargo V. Wade 855 
 
 Parmer v. First Trust Co 625 
 
 Fashion v. Atwood 1111 
 
 Fay V. Moore 811 
 
 Fechteler v. Whittemore 677 
 
 Felthouse v. Bindley 83 
 
 Ferguson v. Coleman 1259 
 
 Ferrier v. Storer 94 
 
 Field V. New York 
 
 1124, 1127, 1130, 1157 
 
 FinJc V. Smith 387 
 
 Fitch V. Snedaker 22 
 
 Flower, Case of 957 
 
XVllI 
 
 TABLE OF CASES 
 
 Page 
 
 Foakes v. Beer 320 
 
 F. O. Evans Piano. Co. v. Tally. . 88 
 
 Fooly and Preston, Case of 211 
 
 Forburger Stone Co. v. Lion 
 
 Bonding & Surety Co 1095 
 
 Ford V. Beech. 937 
 
 Fortescue v. Brograve 1022 
 
 Fosmire v. National Surety Co.. .1100 
 
 Foster v. Dawher 950 
 
 Fowler v. Oallan 1284 
 
 Francis v. Deming 995 
 
 Freeman v. Freeman 209 
 
 Freeth v. Burr 569 
 
 Friar v. Orey 699 
 
 Frost V. Oage 1358 
 
 Frost V. Knight 750 
 
 Fry V. Ausman 108O 
 
 Frye v. Buhhell 328 
 
 Fuller V. Kemp 1006 
 
 Furbish v. Goodnoio 1379 
 
 Gamewell Fire-Alarm Tel. Co. v. 
 
 Crane 1217 
 
 Gammons v. Johnson 1284 
 
 6a Nun v. Palmer 777 
 
 Gardner v. Denison 1073 
 
 Garnsey v. Garnsey 951 
 
 Garst V. Harris 1255 
 
 Gaiston v. Gordon 700 
 
 General Lithographing & Print- 
 ing Co. V. Washington Rubber 
 
 Oo 100 
 
 Gerisch v. Herold 670 
 
 Gerli v. Poidebard Silk Mfg. Co.. 582 
 
 Gibbons v. Proctor 19 
 
 Gibbons v. Vouillon 933 
 
 Gibbs V. Blanchard 1877 
 
 Gibbs V. Smith ..1853 
 
 Gibson v. Cranage 661 
 
 Gibson v. Holland 1458, 1461 
 
 Gift or d V. Corrigan 1080, 1104 
 
 Gill V. Harewood 259 
 
 Gill V. Johnstown Lumber Co.... 562 
 
 Gillespie Tool Co. v. Wilson 654 
 
 Gilliiigham v. Brown 425 
 
 Glaholm V. Hays 696 
 
 Gleason v. Fitzgerald 965 
 
 Globe Mut. Life Ins. Ass'n v. 
 
 Wagner 488 
 
 Goddard v. Binney 1438 
 
 Good V. Cheesman 984 
 
 Goodlsson v. Nunn 518 
 
 Goodrich & Co. v. Friedman 982 
 
 Goring v. Goring 387 
 
 Goulding v. Davidson 415 
 
 Grady v. Home Fire & Marine 
 
 Ins. Co 1303 
 
 Graham v. German American Ins. 
 
 Co mo 
 
 Granger v. French 1338 
 
 Granger Co. v. Brown-Ketcham 
 
 Iron Works 840 
 
 Grant v. Johnson 551 
 
 Page 
 
 Grant v. Porter. 445 
 
 Graves v. Johnson 1369 
 
 Graves v. T^gg 544 
 
 Gray v. Barton 952 
 
 Gray v. . Gardner 712 
 
 Gray v. Martino 381 
 
 Gray v. Meek 558 
 
 Great Northern K. Co. v. Witham 298 
 
 Green, In re 1265 
 
 Green v. Reynolds 521 
 
 Greenwood r. Law 1437 
 
 Griffiji V. Cunningham 1377 
 
 Griffith V. Wells 1357 
 
 Grobe's Estate, In re .1315 
 
 Grogan v. Chaffee 1256 
 
 Grymes v. Blofield 1016 
 
 Guernsey v. Cook 1,343 
 
 Guild & Oo. V. Conrad 1880 
 
 Hadley Falls Nat. Bank v. May. . 987 
 
 Haigh V. Brooks 214 
 
 Hale V. Spaulding 1194 
 
 Hall V. Wright 926 
 
 Hall Mfg. Co. V. Western Steel &, 
 
 Iron Works 1281 
 
 Hallock V. Commercial Ins. Co... 68 
 
 Hamer v. Sidway 252 
 
 Hamilton v. Home Iiis. Co 496 
 
 Hammond v. Niagara Fire Ins. 
 
 Cto 4S4 
 
 Hampden v. Walsh 1259 
 
 Hanau V. Ehrlich 1420 
 
 Hanauer v. Doan-e 1369 
 
 Handy v. Bliss 647 
 
 Hankinson v. Sandilaus 1186 
 
 Hanover Nat. Bank of City of 
 
 New York v. Blake 1356 
 
 Harbor v. Morgan 982, 997 
 
 Harford and Gardiner, Case of. . 887 
 
 Harrison v. Cage 1896 
 
 Harton v. Hildebrand 589 
 
 Hart-Parr Oo. v. Finley 788 
 
 Hartley v. Inhabitants of Gran- 
 ville 384 
 
 Harvey v. Bateman 1111 
 
 Harvey v. Facey 8 
 
 Harvey v. Merrill 1270 
 
 Hatton, In re 987, 990 
 
 Hawkes v. Kehoe 892 
 
 Hawkes v. Saunders 388,449 
 
 Hawkins v. Graham 676 
 
 Hay V. Fortier ' 882 
 
 Hoyden v. Bradley 684 
 
 Hayes v. Jackson 1453 
 
 Hebert v.i Dewey 641 
 
 Helgar Corporation v. Warner's 
 
 Features 598 
 
 Henthorn v. Fraser 46 
 
 Herbert v. Bronson 1130 
 
 Herman v. Connecticut Mut. Life 
 
 Ins. Co 1149 
 
 Herreshoff v. Boutineau 1215 
 
 V. Porell 444 
 
TABLE 0¥ CASES 
 
 XIX 
 
 Page 
 
 Herrington v. Davitt 439 
 
 Herzog v. Sawyer 1023 
 
 Higgens, Case of. 1087 
 
 Higgins V. Lessig 2 
 
 High Wheel Auto Parts Co. v. 
 
 Journal Co. ofl Troy 54 
 
 Hill y. Grigsby 555 
 
 Hills V. Sughrue 8S3 
 
 Milton V. Eckersley 1239 
 
 Bimrod Furnace Co. v. Cleveland 
 
 & M. B. Co 203 
 
 Hirth V. Graham 1400 
 
 Hoare v. Rennie 582 
 
 Hoban v. Hudson 208 
 
 Hobbs V. Massasoit Whip Co 87 
 
 Hochster v. De La Tour 742 
 
 Hokanson t. Western Empire 
 
 Land Co 911 
 
 Holcom'b V. Weaver 1345 
 
 Hollerbach & May Contract Co-.- 
 
 V. Wilkins 805 
 
 Bolman v. Johnson 1364 
 
 Holmes v. Twist 680 
 
 Holt V. Ward Olarencieux 298 
 
 Home, The, v. Selling 1075 
 
 Homer v. Shaw 1141 
 
 Hopkins v. Racine Malleable & 
 
 Wrought Iron Co : . . 185 
 
 Horstmann Co. v. Waterman. .. .1091 
 
 Hosford V. Eno 1346 
 
 HotJiam V. East India Co 713, 810 
 
 Household Fire & Carriage Acci- 
 dent Ins. Co. V. Grant 31 
 
 Houston V. Parley 1398 
 
 HowaM V. Daly 42, 793 
 
 Howard Smith d Co. v. Tarawa. . 95 
 
 Howell V. Coupland 899 
 
 Hugall V. McLean 684 
 
 Hull V. Johnson .3.32, 1011 
 
 Hull V. Ruggles 1365 
 
 Hull Co. V. Marquette Cement 
 
 Mfg. Co 108 
 
 Hunt, Ca?e of 550 
 
 Hunt V. Bate 387 
 
 Hunt V. Brown 997 
 
 Hunt V. Hunt 1396 
 
 Hunt V. Livermore 557 
 
 Hurford v. Pile 163 
 
 Hurlburt v. Bradley 4.32 
 
 Hutley V. Hutley 1273 
 
 Hyde v. Wrench 95 
 
 Hyland v. Crofut 1182 
 
 Ilsley V. Jewett 417 
 
 Imperator Realty Co. v. Tull....l467 
 International Text-Book Co. v. 
 
 Martin 529 
 
 Irwin V. Wilson 114 
 
 Jackson v. Pennsylvania R. Co. . . 1016 
 Jackson v. Security Slut. Life 
 Ins. Co 460 
 
 Page 
 Jacob Johnson Fish Co. v. Haw- 
 ley 130 
 
 Jacob & Youngs v. Kent 656 
 
 Jaffray v. Davis 323,1004 
 
 James v. Burchell 857, 859 
 
 James v. Tilton 1028 
 
 Jameson v. Board of Education. . 794 
 
 Janson v. Colomore 388 
 
 Jell V. Douglas .'. .1203 
 
 Jemlson v. Tindall 1120 
 
 Jenness v. Mt. Hope Iron Co 92 
 
 Jensen v. Goss 587 
 
 Jewett Pub. Co. v. Butler 1324 
 
 J. H. Queal & Co. v. Peterson. . . 262 
 
 Jinnings v. Amend 863 
 
 Jobst V. Hayden Bros 831 
 
 John Horstmann Co. v. Water- 
 man 1091 
 
 John Soley & Sons v. Jones 875 
 
 Johnson v. Great Northern R. 
 
 Co 1280 
 
 Johnson v. Rawle 1030 
 
 Johnson Fish Co. v. Hawley 130 
 
 Johnston Bros. v. Rogers Bros. . . 8 
 
 Johnstone v. Milling 764 
 
 Jonassohn v. Young 584 
 
 Jones V. BarMey 521, 735 
 
 Jones V. Chicago, B. & Q. R. Co. . . 129 
 Jones V. Commonwealth Casualty 
 
 Co 1108 
 
 Johes V. Rice 1289 
 
 Jones & Co. v. Wilkins 1364 
 
 Jordan v. DobMns 171 
 
 Kadi^h v. Young 784, 802 
 
 Kanter v. M. Hof heimer & Co. . . . 1376 
 
 Keightley v. Watson 1205 
 
 Keller v. Holderman .' 1 
 
 Kelly V. Security Mut. Life Ins. 
 
 Co 768 
 
 Kelly Const. Co. v. Hackensack 
 
 Brick Oo 563 
 
 Kelso & Co. V. Ellis 548 
 
 Kendall v. Hamilton 1201 
 
 Kendall v. West 662 , 
 
 Kilday v. Schancupp 1446 
 
 King V. Braine 910 
 
 King V. Connors ; . 609 
 
 King v. Duluth, M. & N. R. Co. . . 354 
 
 King V. Gillett 956 
 
 King v. Hoare 1200 
 
 King v. King 1315 
 
 King Bros. & Oo. v. Central of 
 
 Georgia R. Co 1154 
 
 Kingston v. Preston 512 
 
 Kinney v. Federal Laundry Co.. . 537 
 
 Kirksey v. Kirksey 232 
 
 Klinkoosten v. Mundt 960 
 
 Knight V. Rushworth 213 
 
 Knights of the Modern Maccabees 
 
 V. Sharp 1069 
 
 Koehler & Hlnrichs Mercantile 
 
 Oo. V. Illinois Glass Co 305 
 
XX 
 
 TABLE OF CASES 
 
 Page 
 
 Krell V. Co&man 477 
 
 Krell V. Henry 910 
 
 Eromer v. Heim 982, 997 
 
 Kullman v. Oreenel)aum 1356 
 
 Kyle V. Kavanagh 114 
 
 Laoey v. Hutchinson 471 
 
 Lacy V. Getman 882 
 
 Lacy i. Kinnaston 936 
 
 Lady Sbandois, The, v. Siiuson. . . 209 
 
 Laird v. Pvm 735 
 
 Lakeman v. Mountstephen 1377 
 
 Lalceman v. Pollard 926 
 
 Lampleigh v. Braithwalt 393 
 
 Iiapleau v. Succession of Lapleau 491 
 
 Lattvmore v. Harsen 349 
 
 Law, In re 947 
 
 I/awrence v. Fox 1045 
 
 Lea V. Exelby 506 
 
 Leavitt V. Fletcher 70O 
 
 Leavitt v. Morrow 1013 
 
 Lecomte v. Toudouze .1411 
 
 Lee V. Gaskell 1407 
 
 Lee V. Griffin 1430 
 
 Lee V. Muggeridge 413 
 
 I-egh V. Legh 1121 
 
 Lemle v. Barry 736 
 
 Lennox v. Murphy 76 
 
 Leonard v. Dyer 563 
 
 Lerned v. WwnnemacJier 1458 
 
 Leskie v. Haseltine ■ 9 
 
 Lever v. Heys 1040 
 
 Leveret and Bellamy v. Sherman 520 
 
 Lewis V. Browning 42 
 
 Licey v. Licey 946 
 
 Lima Locomotive & Machine Co. 
 
 V. National Steel Castings Co. . . 303 
 Lingenfelder v. Wainwright Brew- 
 ing Go 345 
 
 Linz V. ' Schuck 350 
 
 List & Son Co. v. Chase 836 
 
 Little y. Blunt 415 
 
 Littlefleld v. Shee 415 
 
 Liverpool & London & Globe Ins. 
 
 Co. V. Kearney 487 
 
 Livingston v. E^lli 1309 
 
 Lock V. Wright 510 
 
 Lond6n & 'Northern Bank, In re 
 
 42., 64, 165 
 
 Long V. White 1407 
 
 Longridge v. DorviUe 280 
 
 Lorah v. Nissley 460 
 
 Lord CUftord v. Watts 886 
 
 Tjord Eanelagh v. Melton 610 
 
 Loring v. Boston 145 
 
 Los Angeles Gas & Electric Co. v. 
 
 Amalgamated Oil Co 601 
 
 Los Angeles Traction Co. v. Wil- 
 
 shire 189 
 
 Losecco V. Gregory 686 
 
 Louisville & N. R. Co. v. Crowe 899 
 
 Lovatt V. Hamilton 713 
 
 Lowe V. Doremus 1313 
 
 Page 
 
 Lowe V. Peers 1315 
 
 Loyd V. Lee 268 
 
 'Lucas V. Dixon 1462 
 
 Lusky V. Keiser 1458 
 
 Lynn v. Bruce 990 
 
 McCartney v. Badovinao 677 
 
 McClure v. Williams 427 
 
 MoGlurg v. Terry.- 2 
 
 McConib V. Kittridge 340 
 
 McCormick v. Tappendorf 842 
 
 McCreery v. Day 1025 
 
 McCuUoch V. Eagle Ins. Co 42 
 
 McDevitt V. Stokes 370 
 
 MacFarlane v. Bloch 193 
 
 McGowin v. Menken 709 
 
 McKenua v. Vernon 824 
 
 McKnight v. Bell 1414 
 
 Maclay v. Harvey. 94 
 
 McMillan v. Ames 200 
 
 McMullan V. Dickinson Co 314 
 
 McRaven v. Crisler 527 
 
 Mactier's Adm'rs v. Frith 145 
 
 Maddison v. Alderson 1475 
 
 Maguire. v. Kiesel 1409 
 
 Main (Sir Anthony) Case of. . ... . 731 
 
 Makin v. Watki/nson 681 
 
 Mallory's Adm'r v. Mallory's 
 
 Adm'r 1396 
 
 Manhattan Life Ins. Co. v. Buck 866 
 Manitowoc Steam Boiler Works 
 
 V. Manitowoc Glue Co 650 
 
 Manley v. Geagan 1378 
 
 Mansfield v. Hodgdon 117 
 
 Mapes V. Sidney 259 
 
 March V. Ward 1187 
 
 Blark Steward, Case of 948 
 
 Marks v. Cowdin 1453 
 
 Marshall v. Green 1403 
 
 Martin y. Meles 248 
 
 Martindale v. Fisher 296, 508 
 
 Martindale v. Fisher 685 
 
 Martinsburg & P. R. Co. v. March 634 
 
 Mary Short v. Stone 858 
 
 Mason v. Eldred 1200 
 
 Mason v. Harvey 684 
 
 Mayor, etc., v. Butler 950 
 
 Meacham v. Jamestown, F. & C. 
 
 R. Co 1298 
 
 Mease v. Wagner 1377 
 
 Meech v. Ensign 1085 
 
 Meguire v. Corwine 1334 
 
 Meigs v. Dexter 468 
 
 Melachrtno v. NickoU & Knight . . 798 
 
 Melles & Co. v. Holme 682 
 
 Melroy v. Kemmerer 338 
 
 Mellen v. Whipple 1055 
 
 Merriam v. Wilkins 409 
 
 Merrick v. Giddings 376 
 
 Merrill v. Peaslee 1319 
 
 Merry v. Allen 972 
 
 Mersey Steel & Iron Co. v. Nay- 
 
 lor, Benzon & Co 56,5 
 
TACLE OP CASES 
 
 XXI 
 
 Page 
 
 Meyer v. Eartman 1380 
 
 Michell V. Stockwith and An- 
 drews 4&i 
 
 Miles & New Zealand Alford Es- 
 tate Oo 283 
 
 Miles V. Schmidt 1301, 1303 
 
 Millar's Karri & Jarrah Ck). v. 
 
 Weddel, Turner & Co. 5S4 
 
 Mills V. Wyman 450 
 
 MUlward v. lAttlewood 1371 
 
 Milnes v. Gery 493 
 
 Milwaukee Motor Co., In re 625 
 
 Mineral Park Land Co. v. How- 
 ard 921 
 
 Minnesota Linseed Oil Co. v. Col- 
 lier White Lead Co 142 
 
 Mississippi & D. S. S. Co. v. Swift 13 
 
 Mitchell V. Hawley 1020 
 
 MitcheU V. ReywUs , . .1207, 1234 
 
 Mittenthal v. Mascngni. . . .1227, 1302 
 Mogul S. 8. Go. v. McGregor. . . . 
 
 1212, 1239 
 Montgomery, Ward & Co. v. John- 
 son 4 
 
 Moody V. Amazon Ins. Co 709 
 
 Moore v. Elmer 400 
 
 Moore v. Williams 387 
 
 Moore & Baker v. Morecomb .... 882 
 
 More V. Bennett 1240 
 
 Morris v. Baron 1468, 1475 
 
 Morris v. Sliter 529 
 
 Morris Run Goal Co. v. Barclay 
 
 Goal Go 1239 
 
 Morsel v. Kenney 134 
 
 Morton v. Burn & Vaux 334 
 
 Morton v. Lamb 518 
 
 Mott V. Jackson 52 
 
 Moulton V. Kershaw 7 
 
 Mowse V. Edney 1111 
 
 Mrs. K. Edwards & Sons v. 
 
 Farve 1418 
 
 Muir V. Kane 429 
 
 Muir V. Sehenck & Robinson 1143 
 
 Munroe v. Perkins 346 
 
 Murphy v. Hanna 315 
 
 Myers v. Jenkins 1303 
 
 Nash V. Armstrong 992 
 
 Nashua River Paper Co. v. Ham- 
 
 mermill Paper Co 1294 
 
 Nassoiy v. Tomlinson 328 
 
 Nassoiy v. Tomlinson 974 
 
 National Bank v. Grand Lodge.. 1059 
 'SlatiorMl Eagle BanJc v. Hunt . . . 171 
 National Machine & Tool Co. v. 
 
 Standard Shoe Machinery Go, 589 
 National Surety Co. v. Winston. . 690 
 
 Nebraska Seed Co. v. Harsh 5 
 
 Neikirbi v. Williams 218 
 
 Xewcomb v. Braekett 733 
 
 New England Concrete Const. Co. 
 
 V. Shepard & Morse Lumber 
 
 Co , 488 
 
 Page 
 New England Mut. Fire Ins. Co. 
 
 V. Butler 739 
 
 Newington v. Levy , 987 
 
 New Orleans St. Joseph's Ass'n v. 
 
 Magnier 1095 
 
 New York Life Ins. Co. v. Seyms S66 
 New York Life Ins. Co. v. Stat- 
 
 ham 866 
 
 Nichols V. Raynbred 508 
 
 iXiclcelson v. Wilson 1290 
 
 Noice V. Brown .' 1360 
 
 Nolan V. Whitney 639 
 
 Norcross v. Wyman 1311 
 
 Nordenfelt v. Maxim Nordenfelt 
 
 Guns & Ammunition Co 1222 
 
 Norrington v. Wright 572 
 
 North German Lloyd v. Guaran- 
 ty Trust Cb 924 
 
 Northrup v. Northrup 528 
 
 Northwestern Nat. Life Ins. Co. 
 
 V. Ward 703 
 
 Noyes v. Brown 522 
 
 Noyes v. Hopgood 1020 
 
 Nugent v. Wolfe 1384 
 
 Nute V. Hamilton Mut. Ins. Go. . . 1294 
 Nyulasy v. Rowan 2 
 
 O'Brien v. Boland 203 
 
 O'Gonnell v. Mount HolyoVc \!ol- 
 
 lege 1378 
 
 OfCord V. Davies ' 181 
 
 Okin V. Selidor .' . .1417 
 
 Ollive V. Booker 693 
 
 O'Neill V. Supreme Council Amer- 
 ican Legion of Honor 771 
 
 Orr V. Orr 254 
 
 Oshorn v. Martha's Vineyard R. 
 
 Co 1208 
 
 Oscar Barnett Foundry Go. v. 
 Crowe 535 
 
 Packard v. Richardson 1450 
 
 Paine v. Meller 522 
 
 Palmbaum v. Magulsky 1.341 
 
 Paradine v. Jane 878 
 
 Pardee v. Kanady 847 
 
 Parker v. Russell 786 
 
 Parks V. Hazlerigg 462 
 
 Parrot v. Mexican Gent. R. Co. . . 349 
 Pasquotank & N. R. Steamboat 
 
 Co. V. Eastern Carolina Transp. 
 
 Co 902 
 
 Patterson v. Chapman 474 
 
 Patterson v. Meyerhofer 816 
 
 Paul Jones & Oo. v. Wilkins 1364 
 
 Payne v. Cave 163 
 
 Pdyzu V. Saunders 803 
 
 Pearce v. Brooks , 1369 
 
 Peelers v. Opie 505 
 
 Pellman v. Hart 1149 
 
 People V. Olohe Mut. Life Ins. Co. 882 
 Peopie V. Harrison 1200 
 
xxu 
 
 TABLE OF CASES 
 
 Page 
 People ex rel. Union Ins. Co. v. 
 
 Nash ....'...1034 
 
 Perry & Walden v. Gallagher 964 
 
 Peter v. ConTpton 1414 
 
 Peters v. Westborough 1414 
 
 Peters v. Sanford & Read 1199 
 
 Philadelphia v. Reeves and Cabot 
 
 1190, 119.3 
 
 Phillips V. Moor 94 
 
 Pickens v. -Bozell 534 
 
 Pierce, Butler & Co. v. .Tones & 
 
 Son 1002 
 
 Pigot, Case o|f 1027 
 
 Pillans V. Van Mierop 222 
 
 Pinnel, Vase of 1004 
 
 Pittsburgh Dredging & Construc- 
 tion Co. V. Monongahela & 
 
 Western Dredging Co 1348 
 
 Pixley V. Boynton 1371 
 
 Plate V. Durst 2 
 
 Poel V. Brunswick-Balke-Collen- 
 
 der Oo. of New York 96 
 
 PoUak V. Brush Electric Ass'n . . 564 
 Pond V. New Rochelle Water Co. 
 
 10G8, 1103 
 
 Pool V. Boston 382 
 
 Pordage v. Cole 508 
 
 Plortugviese-American Bank of 
 
 San Francisco v. Welles 1171 
 
 Poussard v. Spiers & Pond 617 
 
 Powell V. Merrill 697 
 
 Powle V. Hagger 681 
 
 Presbyterian Church of Albany v. 
 
 Cooper 245 
 
 Presoott V. Jones 83 
 
 Price y. Barker 1196 
 
 Prime v. Koehler 1391 
 
 Proctor V. Bauby 1186 
 
 Prokop V. Bedford Waist & Dress 
 
 Coj 1425 
 
 Prout V. Inhabitants of Fire-Dist. 
 
 of Town of Pittsfield 277 
 
 Providence Tool Co. v. Norris . . . 1.325 
 
 Purrington v. Grimm 107 
 
 Pym V. Campbell 467 
 
 Queal & Co. v. Peterson 262 
 
 Queen Ins. Co. v. State 1239 
 
 Raabe v. Squier 1.391 
 
 Rabinowitz v. People's Nat. 
 
 Bank 1153 
 
 Rae V. Haokett 696 
 
 RaflBes v. Wichelhaus 112 
 
 Kague V. New York Evening Jour- 
 nal Pub. Co 308 
 
 Ranelagh (Lord) v. Melton 610 
 
 Rann v. Hughes 220 
 
 Rawstorne v. Oandell 1203 
 
 Ray V. Thompson 717 
 
 Rayburn v. Cornstoclc 784, 806 
 
 Raynay v. Alexander .' 507 
 
 Redfield v. HilHiipuse 1112 
 
 Page 
 Reed v. Loyal Protective Ass'n. . 870 
 
 Reif V. Paige 68, 386 
 
 Reilly v. Bari'ett. 979 
 
 Resseter v. Waterman , .1383 
 
 Reynolds v. Pinhowe 320 
 
 Ribock V. Canner 1393 
 
 Richards v. Bartlet 979 
 
 Richards v. Heather 1193,1203 
 
 Richards' Ex'r v. Richards 233 
 
 Richardson v. Mead 1130 
 
 Richland Queen, The 918 
 
 Richland S. S. Co. v. Buffalo Dry 
 
 Dock Co 918 
 
 Riggs V. BuUingham 391 
 
 Rindge v. Kimball 435 
 
 Ripley v. Crocker 1187 
 
 Ripley v. McClure 735, 784 
 
 Risley v. Phenix Bank 1157 
 
 Rivett and Rivett, Case of 261 
 
 Roberts v. James ; 137 
 
 Roberts v. Security Co 468 
 
 Rook V. Vandine 794 
 
 Roe V. Haugh. 959 
 
 Roebling's Sons' Co. v. Lock- 
 Stitch Fence Co 784 
 
 Roehm v. Horst 749, 764 
 
 Rogers v. Snow , 52 
 
 Bookwood, Case of 1040 
 
 Boscorla v. Thomas 404 
 
 Rosenbaum v. United States Cred- 
 it System Co 1371 
 
 Rosenthal Paper Co. v. National 
 
 Folding Box & Paper Co 849 
 
 Rovegno v. Defferari 114 
 
 Row V. Dawson 1111, 1157 
 
 Rowe V. Gerry 659 
 
 Rowe V. Peabody. 917 
 
 Royal Ins. Co. v. Beatty 80 
 
 Roys V. Johnson 1370 
 
 Rugg V. Moore 589 
 
 Rutherford v. Holbert 1190 
 
 Ryari v. Dockery 382 
 
 V. F- 
 
 .42, 72 
 
 St. Nicholas Church v. Kropp. . . 124 
 St. Regis Paper Co. v. Santa 
 
 Clara Lumber Co 593 
 
 Salmon Falls Mfg. Co. v. Ood- 
 
 \dard 1449 
 
 Samuel Stores, Inc., v. Abrams..l251 
 
 Sanborn v. Flagler 1443 
 
 Sanders v. Pottlitxer Bros. Fruit 
 
 Go. : 16 
 
 Sands v. Trevllian 210 
 
 Schell V. Plumb 784 
 
 Schnell v. Nell 216 
 
 School Dist. of Kansas City ex 
 
 rel. Koken Iron Works r. Lii-ers 
 
 1049, 1098, 1107 
 
 Schroyer v. Thompson 263 
 
 SchuJer V. Myton 374 
 
 Schvfartzreieh v. Bauman-Bascli 354 
 Sch-iceider v. Lang 999 
 
TABLE OF CASES 
 
 . XXUl 
 
 Page 
 
 Scotsoti V. Pegg. 376 
 
 Scott V. Avery 504, 1305 
 
 Scott V. Moragues Lumber Co. . . 492 
 
 Sears v. Eastern B. Go 180 
 
 Seaver v. Ransom 1061 
 
 Second Nat. Bank of Cincinnati, 
 Ohio, V. Pan-Ameiican Bridge 
 
 Co. 6|28 
 
 Sedgwick v. Blancliard 1105 
 
 Selman v. King 487 
 
 Semmes v. Hartford Ins. Co. 703, 870 
 
 Seward & Scales v. Mitchell 296 
 
 Seymour v. Armstrong 98 
 
 Shadforth v. Hlggin 692 
 
 Shadwell v. Shadwell 362 
 
 Shales v. Seignoret .857 
 
 Shallenberger v. Standard Sani- 
 tary Mfg. Co 833 
 
 Shandois, The Lady, v. Simson . . 209 
 
 Sharp V. Hoopes 402 
 
 Shepard v. Carpenter 8 
 
 Sliepard v. Rhodes 218, 445 
 
 Sherman v. Leveret 520 
 
 Sherwood v. Woodward 360 
 
 Short V. Stone 858 
 
 Shuey v. United State.? 178 
 
 Shute V. Shute 1286 
 
 Sidenham and Worliiigton, Case 
 
 of 389 
 
 Sigler V. Sigler 1016 
 
 Simpson v. Crippin 567 
 
 Sir Anthony Main, Case of 731 
 
 Sir Anthony Sturlyn v. Albany . . 212 
 
 Sir William Drury, Case of 928 
 
 Hirkiti V. Fourteenth Xt. Store. .1345 
 
 Skinner Irr. Co. v. Burke 1320 
 
 Slalde, Case of 389 
 
 Slade V. Mutrle 945 
 
 Slater v. Jones 987 
 
 SUngshy, Case of 1206 
 
 Small V. Chicago, R. I. d P. R. 
 
 Co 1288 
 
 Smart v. Hyde 713 
 
 Smart v. Tetherly 963 
 
 Smith V. Bangham 203 
 
 Smith V. Compton 689 
 
 Smith V. Johnson 1005 
 
 Smith V. MacDonald 711 
 
 Smith V. Mathews Const. Co 660 
 
 Smith V. Monteith 283 
 
 Smith V. Mott 1392 
 
 Smith V. Smith 208 
 
 Smith d Co. V. Varawa 95 
 
 Smith & Bice Co. v. Cauady 782 
 
 Soley <fe Sons v. Jones 875 
 
 Somersall v. Barneby 682 
 
 Spalding v. Rosa 882 
 
 Spencer v. Harding H 
 
 Spragwe v. Hosie 1437 
 
 Sprtngstead v. Nees 272 
 
 Stamper v. Temple 3 
 
 Standard Furniture Co. v. Van 
 Alstlne 1365 
 
 Page 
 
 Stanton v. Dennis 11 
 
 Starkweather y. Gleason 141 
 
 State V. Chandler 1203 
 
 State Trust Co. v. Sheldon 422 
 
 Steeds V. Steeds 1021 
 
 Stees V. Leonand 917 
 
 Steinmeyer v. Schroeppel 121 
 
 Stensgaard v. Smith 194 
 
 Stevenson, Jaques & Co. v. Mc- 
 Lean 102 
 
 Steward, Case of 948 
 
 Steteart v. Thayer 1321 
 
 Stiebel v. Grossberg ' 930 
 
 Stilk v. Myrick 343 
 
 Stone V. Bale 464 
 
 Strangborough and Warner, Case 
 
 of 292 
 
 Straus V. Cunningham 445 
 
 Strong V. Sheffield 266 
 
 Sturlyn (Sir Anthony) v. Albany 212 
 
 Sullivan V. Horgan 1372 
 
 Superintendent & Trustees of 
 Public Schools of City of Tren- 
 ton V. Bennett 913 
 
 Swelgart v. Berk 1201 
 
 Taft v. Hyatt 19 
 
 Tanner v. Merrill 332, 1011 
 
 Tarrabochia v, B icicle 696 
 
 Taunton v. Pepler 463 
 
 Tayloe v.j Merchants' Fire Ins. 
 
 Co. of BaUimore 28 
 
 Taylor v. Barton-Child Co 1127 
 
 Taylor y. Ciildwell 888 
 
 Taylor v. Hilary 965 
 
 Thacker v. Hardy 1259 
 
 Thomas v. ('arlicallader 505, 507 
 
 Thomas v. Thomas 222 
 
 Thomas v. Welles 1375 
 
 Thompson v. (iouhJ 522 
 
 Thompson v. h'ei/iioJds 1277 
 
 Thomson v. James 170 
 
 Thorpe V. Thorpe ,505, 512 
 
 Thurnell v. Balbirnie ; . . 495 
 
 Tichnor Bros. v. Ilvans.. 536 
 
 Tinn v. Hoffmann & Co 155 
 
 ' Tode V. (}ross 1247 
 
 Tolhurst V. Powers .386 
 
 Tomlinson v. Gill 1049 
 
 Torkomlan v. Ruf-scU 729 
 
 Tracy v. Talmage 1369, 1371 
 
 Trask v. Weeks 421 
 
 Traver v. — 235 
 
 Trailer v. Halsteil 767 
 
 Trenton Potteries Co. v. Oliiihaiit 
 
 1214, 1217, 1222 
 
 Trevor v. Wood 44 
 
 Trist v. Child .1329 
 
 Trounstlne v. Sellers ... 56 
 
 Trudeau v. Poutre 1379 
 
 Tullis V. Jacsnn 6.33 
 
 Turner v. QoUlsmith 892 
 
 Turner v. Sawdon & Co 820 
 
XXIV 
 
 TABLE OP CASES 
 
 Page 
 
 Tweddle v. Atkinson 1043 
 
 Tyra. v. Cheney 127 
 
 Underwood Typewriter Oo. v. 
 Century Realty Co 236 
 
 United States v. Addyston Pipe 
 £ Steel Go 1215, 1222, 1239 
 
 United States v. Peek 807 
 
 United States v. United Engi- 
 neering & Constructing Co 813 
 
 United States Fidelity & Guar- 
 anty Co. V. Riefler 469 
 
 Valentine v. Foster 445 
 
 Vanderbilt v. Schreyer... 367 
 
 Van Vliet v. Jones 1038 
 
 Very V. Levy 1000 
 
 Vickrey v. Maier 311 
 
 Virginia Iron, Coal & Coke Co. v. 
 
 Graham 883 
 
 Vitty V. fJley 22 
 
 Vrooman v. Turner 1055 
 
 Vyse V. Wakefield 681 
 
 'Waohtel v. 'National Alfalfa Jour- 
 nal Go 190 
 
 Wade V. Simeon 269 
 
 Wai/n V. Warlters 1453 
 
 Walker v. Nussey 1442 
 
 Walter H. Goodrich & Co. v. 
 
 Friedman 982 
 
 Walther v. Merrell , 1385 
 
 Warner v. Texas d P. li. Co 1417 
 
 Warren v. Lynch 457 
 
 Warren v. 'Whitney 444 
 
 Watson V. Turner. 449 
 
 Waugh v. Morris. 1371 
 
 Way V. Sperry 420 
 
 Waymell v. Reed 1363 
 
 Webb, Case of 208 
 
 Weeks v. Tybald 1 
 
 Weiser v. Rowe 776 
 
 Welch v; Mandeville 1122 
 
 Wells V. Alexandre 304, 314 
 
 Wells V. Calnan 522 
 
 West V. Jones 943 
 
 Wetkopsky V.' New 1 lav-en Gas 
 
 Light Oo 1403 
 
 Wharton v. Walker 963 
 
 Wheatley v. Low 212 
 
 Wheaton Building & Lumber Co. 
 
 V. City of Boston 110 
 
 Wheeler v, Klaholt 90 
 
 Wheeler v. McStay 77 
 
 Whelpdale, Case of 1193 
 
 White V. Bluett 257 
 
 White V. Corlies 62 
 
 White V. Gray 981 
 
 White V. McMath & Johnston... 257 
 
 Page 
 
 WMte V. President, etc., of FranJc- 
 
 lin Bank 1371 
 
 White V. Tyndall 1192 
 
 Whiteley v. Hilt 1178 
 
 Whiting V. Glass 1126 
 
 Whitman v. Anglum 917 
 
 Whittaker Chain Tread Co. v. 
 
 Standard Auto Supply Co 1009 
 
 Wigent V. Marrs 786 
 
 Wilkinson v. Oliveira 216 
 
 Wilhite V. Roberts 1276 
 
 William Drury (Sir) Case of 928 
 
 Williams v. Bayley 1293 
 
 Williams v. Branning Mfg. Co. . . 1031 
 
 Williams v. Carwardine 17 
 
 Williams v. Hirshorn 678 
 
 Williams v. Moor 406 
 
 Williams v. West Ohicago St. R. 
 
 Go. 22 
 
 Williams Mfg. Co. v. Standard 
 
 Brass Co 674 
 
 Wilmington & R. R. Co. v. Robe- 
 son 719 
 
 Wilson V. Garnley 1212, 1369 
 
 WUson V. Coupland 963 
 
 Winch V. Keeley 1112 
 
 Winders v. Kenan 613 
 
 Wisconsin & M. R. Oo. v. Powers 226 
 
 Withers v. Reynolds 560 
 
 Wobum Nat. Bank v. Woods .... 117 
 
 Wolff V. Koppel 1391 
 
 Wood V. Krepps 1359 
 
 Wood V. Lucy, Lady Duff- Gordon 309 
 
 Wood V. Moriarty 1054, 1110 
 
 Wood V. Steele 1026 
 
 Woodstock Iron Co. v. Richmond 
 
 & D. Extension Go 1341 
 
 Work V. Beach 491 
 
 Worsley v. Wood 491 
 
 Wright v. Da-nnah 1446 
 
 Wright v. Farmers' Nat. Bank . . . 
 
 402, 491 
 
 Xenos V. -Wickham 465 
 
 Y. B 464, 877, 103T 
 
 y- B 9S2, 1233 
 
 Terrington v. Greene 879 
 
 Young V. Ingalsbe 1438 
 
 Young Men's Christian Ass'n v. 
 Efetill 242 
 
 Zdleski v. Clark .662 
 
 Zavelo V. Reeves 435 
 
 Zembler v. Fitzgerald 1270 
 
 Ziehen v. Smith 860 
 
 Zuck V. McClure 757 
 
 Zwleker v, Gardner 1408 
 
CASES 
 
 ON THE 
 
 LAW OF CONTRACTS 
 
 CHAPTER I 
 OFFER AND ACCEPTANCE 
 
 SECTION 1.— INOPERATIVE PRELIMINARY NEGOTIA- 
 TION 
 
 WEEKS V. TYBALD. 
 (In the King's Bench, 1605. Not. 11.) 
 
 In an assumpsit the plaintiff alleges, that whereas there was a com- 
 munication of marriage between the plaintiff and the daughter of the 
 defendant, that the defendant upon speech between the father of the 
 plaintiff and the defendant, for free liberty to the plaintiff to come to 
 the house of the defendant to woo his daughter, the defendant then 
 and there affirm'd and publish't that he would' give £100 to him that 
 should marry his daughter with his consent, &c. By the court the ac- 
 tion doth not lye, for asseruit et publicavit doth not make words that 
 include a promise. 
 
 It is not aver'd nor declar'd to whom the words were spoken, and 
 it is not reason that the defendant should be bound by such general 
 words spoken to excite suitors. 
 
 KELLER V. HOLDERMAN. 
 
 (Supreme Court of Michigan, 1863. 11 Mich. 248, 83 Am. Dec. 737.) 
 
 Action by Holderman^ against Keller upon a check for $300 drawn 
 by Keller upon a banker at Niles, and not honored. The cause was 
 tried without a jury, and the Circuit Judge found as facts, that the 
 check was given for an old silver watch, worth about $15, which Kel- 
 ler took and kept till the day of trial, when he offered to return it to 
 the plaintiff, who refused to receive nt. The whole transaction was a 
 
 COEBIN CONT ^1 
 
2 OFFER AND ACCEPTANCE ' (Ch. 1 
 
 frolic and banter — ^the plaintiff not expecting to sell, nor the defend- 
 ant intending to buy the watch at the sum for which the check was 
 drawn. The defendant when he drew the check had no money in the 
 banker's hands, and had intended to insert a condition in the check 
 that would prevent his being liable upon it ; but as he had failed to do 
 so, and had retained the watch, the Judge held him liable, and judg- 
 ment was rendered against. him for the amount of the check. 
 
 Martin, C. J. When the court below found as a fact that "the 
 whole transaction between the parties was a frolic and a banter, the 
 plaintiff not expecting to sell, nor the defendant intending to buy the 
 watch at the sum for which the check was drawn," the conclusion 
 should have been that no contract was ever made by the parties, and 
 the finding should have been that no cause of action existed upon the 
 check to the plaintiff. 
 
 The judgment is reversed, with costs of this court and of the court 
 below. ^ 
 
 The other Justices concurred. 
 
 HIGGINS V. LESSIG. 
 (Appellate Court of lUinois, 1893. 49 111. App. 459.) 
 
 Cartwright, J.^ Appellant was the owner of a set of old double 
 harness, worth perhaps $15, which was taken from his premises with- 
 out his knowledge, and he offered a reward of $100 for the recovery 
 of the harness and the conviction of the thief. A few days afterward a 
 boy named Wilt found part of the harness in appellee's berry patch, 
 and appellant went with appellee to the place and brought that part of 
 the harness into appellee's blacksmith shop. Appellant gave the boy 
 who had found the harness a quarter of a dollar, and said he would 
 give him a dollar to find the rest of it. Appellee claims that appellant 
 at that time offered a reward of $100 to the one who would find out 
 who the thief was, and that he earned the reward. This suit was 
 brought to recover the amount so claimed as a reward, and a trial re- 
 sulted in a verdict and judgment for appellee for $100. 
 
 The evidence showed that the defendant was much excited on the 
 
 iln accord: McClurg v. Terry, 21 N. J. Eq. 225 (1870); Theiss v. Weiss, 
 166 Pa. 9, 31 Atl. 63, 45 Am. St. Rep. 638 (1895) ; Bruce v. Bishop, 43 Vt. 161 
 (1870); Paulus, Digest, XLIV, 7, 3, § 2; German Civ. Code, § 118. 
 
 In Plate v. Durst, 42 W. Va. 63, 24 S. E. 580, 32 L. R. A. 404 (1896), the 
 defendant promised plaintiff $1,000 and a diamond ring if she would stay in 
 his service. He now claims this was said in jest. The court said: "Jokes are 
 sometimes taken seriously by the young and inexperienced in the deceptive 
 ways of the business world, and if such is the case, and thereby the person 
 deceived is led to give valuable services in the full belief and expectation that 
 the joker is in earnest, the law will also take the joker at his word, and give 
 him good reason to smile." See, to the same efCect: Nyulasy v. Bowan 17 
 Vict. I>. B. 663 (1891) ; Theiss v. "Weiss, supra. 
 
 2 Part of the opinion is omitted. 
 
Seel) INOPERATIVE PRELIMINARY NEGOTIATION 3 
 
 occasion, when it is claimed that the offer was made in the shop. 
 Plaintiff's, version of the language used was that defendailt said, "I 
 will give $100 to any man who will find out who the thief is, and I will 
 give a lawyer $100 for prosecuting him," using rough language and ep- 
 ithets concerning the thief. There was evidence of substantial repeti- 
 tions of the statement, together with the assertion that he would not 
 have a second-class lawyer, either, and that he would not hire a cheap 
 lawyer, but a good lawyer. The harness had been taken by a man call- 
 ed Red John Smith, who had been adjudged insane, and a Mrs. Phil- 
 lips told the plaintifif that she saw Smith walking by with the harness 
 on his back, on Sunday morning, which was the time when it was tak- 
 en. Plaintiff watched Smith that night and saw him hiding the collars, 
 and the next day he waited for the return of the defendant from Gales- 
 burg, and told him that Red John Smith had the harness. A search 
 warrant was procured, and the remainder of the harness was found. 
 
 We do not think that the language used was such as, under the cir- 
 cumstances, would show an intention to contract to pay a reward, and 
 think plaintiff had no right to regard it as such. Defendant had pre- 
 viously offered a very liberal reward for the return of the old harness 
 and the conviction of the thief. On this occasion he paid the boy only 
 a trifling sum, and offered only $1 for finding the rest of the property. 
 His further language was in the nature of an explosion of wrath 
 against some supposed thief who had stolen the harness, and was cou- 
 pled with boasting and bluster about the prosecution of the thief. It 
 was indicative of a state of excitement, so out of proportion to the 
 supposed cause of it, that it should be regarded rather as the extrava- 
 gant exclamation of an excited man than as manifesting an intention 
 to contract. * * * a 
 
 3 In accord: Stamper v. Temple, 6 Humph. (Term.) 113, 44 Am. Dec. 296 
 (1845). 
 
 The absence of an intention to create legal relations may be evidenced in 
 various virays. In Balfour v. Balfour, [1919] 2 K. B. 571, Atkin, L. J., said: 
 "There are agreements which do not result in contracts. * * * The ordi- 
 nary example is where two parties agree to take a walk together, or where 
 there is an offer and acceptance of hospitality. * * * One of tlie most usual 
 forms of agreement which does not constitute a contract appears to me to be 
 the arrangements which are made between husband and wife. * * * They 
 are not contracts, because the parties did not intend that they should be at- 
 tended by legal consequences." 
 
 Sometimes parties merely give their "word of ^lonor, as business men," 
 Osgood V. Skinner, 211 111. 229, 71 N. E. 869 (1904) ; or they may expressly 
 provide that their agreement shall not be enforceable at law. Smith v. Mac- 
 donald, 37 Cal. App. 503, 174 Eac. 80 (1918), post, p. 711 ; Monroe v. Martin, 
 137 Ga. 262, 73 S. E. 341 (1911). 
 
4 OFPEE AND ACCEPTANCE (Ch. 1 
 
 MONTGOMERY WARD & CO. v. JOHNSON. 
 (Supreme Judicial Court of Massachusetts, 1911. 209 Mass. 89, 95 N. E. 290.) 
 
 Bill by Montgomery Ward & Co. against Mary E. Johnson. Decree 
 for defendant, and plaintiff appeals. Affirmed. 
 
 Braley, J. The essential allegations of the bill are admitted by the 
 demurrer, but if they fail to show a binding contract between the par- 
 ties, it cannot be maintained for specific performance, or injunctive re- 
 lief. The defendant manufactured and sold firearms of certain types, 
 which had acquired in the market a recognized reputation for their 
 quality and style of workmanship. In the management of the business, 
 sales were made only to jobbers, who were to resell to their customers 
 at a uniform price. But halving received complaints that the scale of 
 prices in some instances had not been followed, she issued a printed 
 letter, which after reciting the cause of its publication, and that "we 
 have prepared, and are sending under this cover by registered post, a 
 printed document setting forth the terms and conditions upon which 
 iver Johnson revolvers will be supplied to the jobbing trade," contain- 
 ed the statement that "hereafter no order will be filled except upon 
 the terms set forth in the enclosed document, therefore please read it 
 carefully, for we are going to ask your support and cooperation." The 
 plaintiff apparently was a customer of the defendant, and having re- 
 ceived the letter, alleges that it was "a certain offer in writing to make 
 a contract," the terms and conditions of which were expressed in the 
 accompanying document. It is then alleged that, "intending to accept 
 said contract, and to cause that the defendant should be bound by said 
 acceptance, and that the parties should be mutually bound thereby," the 
 plaintiff transmitted to the defendant an order for revolvers ; but there 
 is no allegation that this purpose was communicated to her, or that 
 the order was accepted with this understanding. 
 
 The plaintiff relies on these transactions as constituting a bilateral 
 contract. But if the letter and document are examined in connection 
 with the recitals, they were not in the nature of a general offer, where 
 upon compliance with the conditions by those to whom it is addressed, 
 a legally binding contract at once springs into existence. The defend- 
 ant promulgated the terms under which she proposed to do business 
 in the future, not with the plaintiff only, but with the members of the 
 jobbing trade, who were to be treated as licensees, if they would agree 
 to abide by tliem. It is expressly announc-ed, in the seventh paragraph 
 of the document, that the defendant does not utidertake to furnish, or 
 to be responsible for a failure to deliver goods which may be ordered, 
 and the words, "that it can be revoked without liability for damages 
 by thirty days written notice, to date from the actual mailing of the 
 notice," refer to the license to deal in the defendant's product, with a 
 discontinuance of all business relations. "A contract is an agreement 
 which creates an obligation," said Mr. Justice Field in Ashcroft v. 
 
Seel) INOPERATIVE PEELIMINAEY NEGOTIATION 5 
 
 Butterworth, 136 Mass. 511, 514. And an invitation to prospective 
 buyers to negotiate for a license, and to trade with the defendant, even 
 when confined to a definite class, imposes no obligation on the sender 
 of accepting any offer which thereafter might be received. The order 
 of the prospective buyer does not ripen into a contract of sale until the 
 defendant's acceptance, and then only as to goods specifically ordered. 
 Smith V. Gowdy, 8 Allen, 566; Lincoln v. Erie Preserving Co., 132 
 Mass. 129; Edge Moor Bridge Works v. Bristol, 170 Mass. 528, 49 
 N. E. 918; Moulton v. Kershaw, 59 Wis. 316, 18 N. W. 172, 48 Am. 
 Rep. 516; Spencer v. Harding, L,. R. 5 C. P. 561; Canning v. Far- 
 quhar, 16 Q. B. D. 727, 732. 
 
 We are of opinion that a fair interpretation of the letter, and docu- 
 ment, very plainly shows that it was not a general offer to sell to those 
 addressed, but an announcement, or invitation, that the defendant 
 would receive proposals for sales on the terms and conditions stated, 
 which she might accept or reject at her option. No contract between 
 the parties having been created, the defendant's refusal to accept and 
 fill the plaintiff's orders, as alleged in the bill, was not an actionable 
 wrong, and the further questions of a breach, and the measure and 
 form of relief, and whether the contract was legally terminated by the 
 notice, become immaterial, and need not be discussed. 
 
 The decree of the single justice, sustaining the demurrer and dis- 
 missing the bill, must be affirmed with costs. 
 
 Decree accordingly. 
 
 NEBRASKA SEED CO. v. HARSH. 
 
 (Supreme Court of Nebraska, 3915. 98 Neb. 89, 152 N. W. 310, L. R. A. 
 
 1915P, 824.) 
 
 Action by the Nebraska Seed Company, a corporation, against H. 
 F. Harsh. From judgment for plaintiff, defendant appeals. Re- 
 versed. 
 
 MoRRisSEY, C. J. Plaintiff, a corporation, engaged in buying and 
 selling seed in the city of Omaha, Neb., brought this action against 
 the defendant, a farmer residing at Lowell, Kearney county. Neb.' 
 The petition alleges : 
 
 "That on the 26th day of April, 1912, the plaintiff purchased of and 
 from the defendant 1,800 bushels of millet seed at the agreed price of 
 $2.25 per hundredweight, F. O. B. Lowell, Neb., which said purchase 
 and contract was evidenced by writing and correspondence passing be^ 
 tween the respective parties of which the following is a copy: 
 
 '"Lowell, Nebraska, 4—24—1912. 
 
 '"■Neb. Seed Co., Omaha, Neb.— Gentlemen : I have about 1,800 
 bu. or thereabouts of millet seed of which I am mailing you a sample. 
 This millet is recleaned and was grown on sod and is good seed. I 
 want $2.25 per cwt. for this seed f . o. b. Lowell. 
 
 " 'Yours truly, ' , H. F. Harsh.' 
 
6 OFFER AND ACCiSPTANCE (Ch. 1 
 
 ■'"Said letter was received by the plaintiff at its place of business in 
 Gmaha, Neb., on the 26th day of April, 1912, and immediately there- 
 after the plaintiff telegraphed to the defendant at Lowell, Neb., a copy 
 of which is as follows: 
 
 '< ■4_26-.12. 
 
 " 'H. P. Harsh, tyowell, Nebr. Sample and letter received. Accept 
 your offer. Millet like sample two twenty-five per hundred. Wire 
 how soon can load. The Nebraska Seed Co.' 
 
 ■ "On the same day, to wit, April 26, 1912, the plaintiff, in answer to 
 the letter of the said defendant, wrote to him a letter and deposited 
 the same in the United States mail, directed to the said defendant at 
 Lowell, Neb., which said letter was duly stamped, and which the plain- 
 tiff charges that the defendant in due course of mail received. That a 
 copy of said letter is as follows: 
 
 • ■ "'4_26— 12. 
 
 ; " 'Mr. H. F. Harsh, Lowell, Neb. — Dear Sir : We received your 
 letter and sample of millet seed this morning and at once wired you as 
 follows : "Sample and letter received. Accept your offer. Millet like 
 Sample two twenty-five per hundred, wire how soon can load." We 
 dohfii-m this message have booked purchase of you 1,800 bushels of 
 millet seed to be fully equal to sample you sent us at $2.25 per cwt. 
 ydur track. Please be so kind as to load this seed at once and ship to 
 us at Omaha. We thank you in advance for prompt attention. When 
 anything further in the line of millet to offer, let us have samples. 
 " 'Yours truly. The Nebraska Seed Co.' " 
 
 It alleges that defendant refused to deliver the seed, after due de- 
 marid and tender of the purchase price, and prays judgment in the 
 sum of $900. Defendant filed a demurrer, which was overruled. He 
 saved an exception to the ruling and answered, denying that the peti- 
 tion stated a cause of action; that the correspondence set out consti-^ 
 tuted a contract, etc. There was a trial to a jury with verdict and 
 judgment for plaintiff, and defendant appeals. 
 
 In our opinion the letter of defendant cannot be fairly construed in- 
 to an offer to sell to the plaintiff. After describing the seed, the writ- 
 er says, "I want $2.25 per cwt. for this seed f. o. b. Lowell." He does 
 not say, "I offer to sell to you." The language used is general, and 
 such as may be used in an advertisement, or circular addressed gener- 
 ally to those engaged in the seed business, and is not an offer by which 
 he may be bound, if accepted, by any or all of the persons addressed. 
 
 "If a proposal is nothing more than an invitation to the person to 
 whom it is made to make an offer to the proposer, it is not such an 
 offer as can be turned into an agreement by acceptance. Proposals of 
 this kind, although made to definite persons and not to the public gen- 
 erally, are merely invitations to trade; they go no further than what 
 occurs when one asks another what he will give or take for certain 
 goods. Such inquiries may lead to bargains, but do not make them. 
 
-Seel) INOPERATIVE PBELIMINABT NEGOTIATION '*7 
 
 They ask for offers which the proposer has a right to accept or reject 
 as he pleases." 9 Gyc. 278e. 
 
 The letter as a whole shows that it was not intended as a final prop- 
 osition, but as a request for bids. It did not fix a time for delivery, 
 and this seems to have been regarded as one of the essentials by plain- 
 tiff, for in his telegram he requests defendant to "wire how soon can 
 load." 
 
 "The mere statement of the price at which property is held cannot 
 be understood as an offer to sell." Knight v. Cooley, 34 Iowa, 218. ' 
 
 The letter of acceptance is not in the terms of the offer. Defend- 
 ant stated that he had 1,800 bushels or thereabouts. He did not fix 
 a definite and certain amount. It might be 1,800 bushels ; it might be 
 more ; it might be less ; but plaintiff undertook to make an acceptance 
 for 1,800 bushels — no more, no less. Defendant might not have thife 
 amount, and therefore be unable to deliver, or he might have a greater 
 amount, and, after filling plaintiff's order; have a quantity of seed left 
 for which he might find no market. We may assume that when he 
 wrote the letter he did not contemplate the sale of more seed than he 
 had, and that he fixed the price on the whole lot whether it was more 
 or less than 1,800 bushels. 
 
 We do not think the correspondence made a complete contract. To 
 so hold where a party sends out letters to a number of dealers would 
 subject him to a suit by each one receiving a letter, or invitations to 
 bid, even though his supply of seed were exhausted. In Lyman v. 
 Robinson, 14 Allen (Mass.) 242, 254, the Supreme Court of Massachu'- 
 setts has sounded the warning : , 
 
 "Care should always be taken not to construe as an agreement letters 
 which the parties intended only as a preliminary negotiation." 
 
 Holding, as we do, that there was no binding contract between the 
 parties, it is unnecessary to discuss the other questions presented. 
 
 The judgment of the district court is reversed.* 
 
 * In Moulton v. Kershaw, 59 Wis. 316, 18 N. W. 172, 48 Am. Eep. 516 (1884) 
 the defendant sent the following letter: 
 
 "Milwaukee, September 19, 1882. 
 
 "J. H. Moulton, Esq., La Crosse, Wis. — ^Dear Sir: In consequence of a rup- 
 ture in the salt trade, we are authorized to offer Michigan fine salt, in full 
 car-load lots of 80 to 95 bbls., delivered at your city, at 85c. per bbl., to be 
 shipped per C. & N. W. E. R. Co. only. At this price it is a bargain, as the 
 price In general remains unchanged. Shall be pleased to receive your order. 
 "■Jours truly, C. J. Kershaw & Son." 
 
 The plaintiff replied, saying: "You may ship me two thousand barrels as 
 offered in your letter." It was held that the defendant's letter created no 
 power of acceptance, but was a mere invitation to deal. 
 
 In Aheam v. Ayres, 38 Mich. 692 (1878) the opinion of the court was as 
 follows: "Ahearn sued defendants for not accepting certain stave bolts. It 
 appears that he asked one of the firm what they were paying for bolts, and 
 was answered they would take all he could make and deliver at $2 per cord. 
 He afterwards made a lot of ^olts,, which he proposed to furnish, but thejr 
 denied any bargain. There was no contract made out. Ahearn did not lii- 
 form defendants that he would accept or act on their order, or deliver any 
 
8 OFFER AND ACCEPTANCE (Ch. 1 
 
 SHEPARD V. CARPENTER. 
 (Supreme Court of Minnesota, 1893. 54 Minn. 153, 55 N. W. 906.) 
 
 Action on a contract by Eugene S. Shepard against Herbert M. 
 Carpenter. Defendant had judgment, and plaintiff appeals. Affirmed. 
 
 GilfUhI^an, C. J. A contract between two persons, upon a valid 
 consideration, that they will, at some specified time in the future, at 
 the election of one of them, enter into a particular contract, specifying 
 its terms, is undoubtedly binding, and upon a breach thereof the party 
 having the election or option may recover as damages what such par- 
 ticular contract to be entered into, would have been worth to him, if 
 made. But an agreement that they will in the future make such con- 
 tract as they may then agree upon amounts to nothing. An agreement 
 to enter into negotiations, and agree upon the terms of a contract, if 
 they can, cannot be made the basis of a cause of action. There would 
 be no way by which the court could determine what sort of a contract 
 the negotiations would result in ; no rule by which the court could as- 
 certain whether any, or, if so, What, damages might follow a refusal 
 to enter into such future contract. So, to be enforceable, a contract to 
 enter into a future contract must specify all its material and essential 
 terms, and leave none to be agreed upon as the result of future nego- 
 tiations. 
 
 bolts, or, if any, how many. The transaction went no further than what oc- 
 curs when any one asks another what he will either give or take for commodi- 
 ties. Such inquiries may lead to bargains, but do not make them." 
 
 In Harvey v. Facey, [1893] A. C. 552, the plaintiff telegra.phed: "Will you 
 sell us Bumper Hall Pen? Telegraph lowest cash price — answer paid." The 
 defendant replied: "Lowest price for Bumper Hall Pen f900." The plaintifE 
 then telegraphed: "We sgree to buy Bumper Hall Pen for the sum of £900 
 asked by you." It was held there was no contract. 
 
 In Sellers v. Warren, 116 Me. 350, 102 Atl. 40 (1917) A.' offered to buy B.'s 
 interest In certain land for four-elevenths of the total selling price. B. re- 
 plied: "Cannot accept offer ; would not consider less than half." A. tele- 
 graphed: "Accept your offer of equal division." There was no contract made. 
 
 The following cases held that there was no offer creating any power of ac- 
 ceptance : Patton v. Amey, 95 Iowa, 664, 64 N. W. 635 (1895), defendant wrote 
 that his steers "ought to be Worth ?4.25 ; Johnston Bros. v. Eog6rs Bros., 30 
 Ont. 150 (1899), "We quote you f. o. b. your station Hungarian $5.40 car lots 
 only. * * * We would suggest your using the wire to order as prices are 
 so rapidly advancing;" State v. Peters, 91 Me. 31, 39 Atl. 342 (1897), quotation 
 of prices; Smith v. Gowdy, 8 Allen (Mass.) 566 (1864); Cherokee Tanning 
 Extract Co. v. Western Union Tel. Co., 143 N. C. 376, 55 S. E. 777,- 118 Am 
 St. Rep. 806 (19,06) ; Beaupre v. Pacific & A. Tel. Co., 21 Minn. 155 (1874) ; Hall 
 V. Kimbark, Fed. Cas. No. 5,938 (1874) ; Schuhmacher v. Lebeck, 103 Kan 
 458, 173 Pac. 1072, L. R. A. 1918F, 788 (1918), mere statement of terms of sale 
 ■to a broker is not an offer to the broker ; Boyers & Co. v. Duke, , [1905] I. R 
 617, 3 B. B. C. 220. 
 
 In the following cases the words used constituted an offer: Fairmount 
 Glass Works v. Crunden-Martih Woodenware Co., 106 Ky. 659, 51 S. W. 196 
 (1899), "We quote you Mason jars * * * pints $4.50 per gross, for imme- 
 diate acceptance" ; Lawrence v. Milwaukee L. S. & W. E. Co., 84 Wis 427 
 S4 N. W, 797 (1893) ; Woldert v. Arledge, 4 Tex. Oiv. App. 692, 23 S. W " 1052 
 (1893). See, further, L. R. A. 1915F, 824, note. 
 
Seel) INOPERATIVE PEELIMINABT NEGOTIATION 9 
 
 The agreement herein sued on leaves essential terms of the future 
 contract to be fixed by future agreement. It clearly contemplated that 
 the logs to be cut and hauled should be delivered at some one place, but 
 it does not specify what place, but instead thereof provides that the 
 (future) contract shall be for plaintiff to cut into logs, "haul and de- 
 liver at the boom or other place of delivery, to be in and by said con- 
 tract agreed upon," without indicating what boom, or where it may -be. 
 The place of delivery was manifestly left to be agreed on, and, when 
 agreed on, inserted in the future contract. How payments were to be 
 made by plaintiff for logs sold by him was a matter of serious impor- 
 tance, but all the contract says of it is : "One-third of the selling price 
 
 thereof, in cash, to be paid within days after such sale shall be 
 
 made." 
 
 It is manifest the parties intended the future contract to specify the 
 number of days within which payment or payments were to be made, 
 but that they had not agreed on the number of days, and so left it to 
 be agreed on and inserted in the future contract. A perhaps still more 
 important matter was within what time the logs should be cut. All the 
 contract says of that is "that the amount of timber or logs to be cut 
 in any one year shall be agreed itpon, and be expressed in said con- 
 tract." Where a final contract fails to express some matter, as, for 
 instance, a time for payment, the' law may imply the intention of the 
 parties; .but, where a preliminary contract leaves certain terms to be 
 agreed upon for the purpose of a final contract, there can be no impli- 
 cation of what the parties will agree upon. Judgment affirmed." 
 
 LESKIE v. HASELTINE. 
 (Supreme Court of Pennsylvania, 1893. 155 Pa. 98, 25 Atl. 886.) 
 
 Assumpsit by Henry B. Leskie against Charles P. Haseltine for 
 breach of an agreement by defendant to give .plaintiff the contract, as 
 the successful bidder, for the erection of a building in Philadelphia. 
 From a judgment entered on a verdict in defendant's favor, plaintiff 
 appeals. Affirmed. 
 
 The defendant, Charles E. Haseltine, desired to erect a large and 
 costly building in Philadelphia, and requested his architect to ask for 
 estimates. The architect did so by postal cards sent to a number of 
 builders, in the following form : "204 South Fifth Street, March 28th, 
 1887. Dear Sir: You are requested- to estimate on the Haseltine 
 building. My office will be open from 9 A. m to 5 p. m. All bids must 
 be addressed to me, and must be received at this office by noon, Wed- 
 nesday, April 6th. Yours truly, W. N. L,ockington, per W. W. L,." 
 
 B In accord: Sibley v. Felton, 156 Mass. 2T3, 31 N. E. 10 (1892) ; St. Louis 
 & S. F. R. Co. V. Gorman, 79 Kan. 643, 100 Pac. 647, 28 L. R. A. (N. S.) 637 
 (1909) I Somers v. Musolf, 86 Ark. 97, 109 S. W. 1173 (1908). See, also, Var- 
 ney v. Ditmars, 217 N. T. 223, 111 N. E. 822, Ann. Cas. 1916B, 758 (1916). 
 
10 OFFER AND ACCEPTANCE (Ch. 1 
 
 Ten builders, including H. B. Leskie, the plaintiff in this case, sent 
 written estimates. Most of these were brought to the architect's of- 
 fice at noon on Wednesday, April 6th, the time mentioned in the post- 
 al card. The estimates were then opened, Mr. Haseltine and most of 
 the builders or their representatives being present. The plaintiff's bid 
 was the lowest. It was in the alternative for either $152,740 or $153,- 
 000, according to whether brick or iron arches were to be used. The 
 plaintiff testij&ed that when the bids were read out, the defendant smil- 
 ed; and said to plaintiff, "You are the lucky man." A witness called 
 by the plaintiff added to this that the defendant said, "You have won, 
 and fairly so." The defendant and his architect testified that all that 
 was said by defendant was, "That is all for the present," and that the 
 matter was adjourned for the purpose of considering the estimates, 
 arid this was corroborated by two or three other persons who were 
 present. It was understood by all parties that a formal written con- 
 tract would have to be entered into for the erection of the building be- 
 fore anything would be done. 
 
 The plaintiff testified that during several days after the opening of 
 the estimates, and while the matter was under consideration, some of 
 the details which would enter into such a contract were discussed be- 
 tween him and the defendant, but many of these details remained un- 
 settled. While these matters were under discussion, and before any 
 contract had been prepared or signed, the defendant, who had.been in- 
 vestigating the character and ability of the plaintiff, came to the con- 
 clusion that he was not a desirable man to whom to intrust so large an 
 undertaking, and notified him that he had concluded to give the con- 
 tract to another bidder. 
 
 Defendant subsequently entered into a formal written contract with 
 one of the higher bidders. The plaintiff then sued him for $15,000, 
 alleging that what took place at the architect's office on the reading of 
 the estimates amounted to a binding contract in law between the plain- 
 tiff and defendant for the erection of the building.^ 
 
 Pbr Curiam. The plaintiff was admittedly the lowest bidder for the 
 erection of defendant's building. It does not follow, however, that be- 
 cause he was the lowest bidder the defendant was bound to award him 
 the contract. The fact that upon the opening of the bids either the ar- 
 chitect or the defendant may have said to the plaintiff : "You are the 
 lucky man," amounts to nothing more than a recognition of the fact 
 that he was the lowest bidder. After the bids had been opened, it was 
 the right of the defendant to inquire into the fitness and ability of the 
 respective bidders to fulfill, the contract. He was not bound to award 
 it to a bidder who lacked either the skill, experience, or ability to prop- 
 erly perform the contract. 
 
 In this case the contract never was awarded to the plaintiff. There 
 were a number of questions to bie settled when the defendant and the 
 
 «Tlie statement of facts is condensed. 
 
SeC.l) INOPERATIVE PEELIMINAEY NEGOTIATION H 
 
 bidder were brought together before their minds could be said to have 
 agreed upon anything. The learned judge below submitted the case 
 to the jury under proper instructions, and their verdict is the end of 
 the matter. 
 
 Judgment affirmed.'' ' i 
 
 STANTON V. DENNIS. 
 (Supreme Court of Washington, 1911. 64 Wash. 85, 116 Pac. 650.) ' 
 
 Action by E. M. Stanton against W. H. Dennis. From a judgment 
 for plaintiff, defendant appeals. Reversed and remanded. 
 
 FuLLERTON, J. Some time in 1909, the Thompson-Starrett Com- 
 pany entered into a contract to construct an addition to the Fidelity 
 Trust Company's building in the city of Tacoma. Thereafter they 
 sublet the contract for doing the painting and carpentry work on the 
 building to the appellant, W. H. Dennis. The appellant, being desir- 
 ous of again subletting the carpentry work, requested one Phil E. Duri- 
 navant to bid thereon, at the same time furnishing him with a copy of 
 the plans and specifications of the work. Later on Dunnavant sub- 
 mitted the following writing : ' ' 
 
 "Portland, Ore., Jan. 7, 1910. W. H. Dennis, Seattle, Wash.— Dea'r 
 Sir : Confirming our conversation with you over long distance phone 
 this afternoon we propose to furnish all labor for setting millwork and 
 carpentry on the addition to the Fidelity Trust Co.'s building at Ta- 
 coma, Wash., for the sum of five thousand seven hundred and no/100 
 dollars ($5,700.00). The work above mentioned is to be included and 
 above the seventh floor and is to be in accordance with plans arid spec- 
 ifications prepared by D, H. Burnham, Chicago. It is understood th^t 
 we are not to furnish labor for laying floors, putting up door jacks or 
 setting any centers or grounds. It is also understood that we are' to 
 furnish no material of any description used in setting the millwork or 
 in any of the carpentry work. Formal contract to follow. ' Phil E. 
 Dunnavant & Co., per Phil E. Dunnavant. Accepted : ' — — '." 
 
 This writing with duplicate copies was forwarded to the appellant 
 by Dunnavant, who, upon recefpt thereof, wrote his name after the 
 word "Accepted," and returned the same to Dunnavant. 
 
 Early in February, 1910, Dunnavant became financially embarrassed 
 and sought the appellant, and suggested to him the idea of putting the 
 contract in the name of a third party. The appellant took the matter 
 under consideration, and Dunnavant returned to his home at Portland, 
 Or., from which place he wrote the appellant as follows : "Portland, 
 Oregon. Feb. 25, 1910. W. H. Dennis; White Building, Seattle, 
 Wash. — ^Dear Sir : Would like to have you write me and let me know 
 
 ■: In accord: United States v. Daniels, 231 IT. S. 218, 84 Sup. Ct. 84, 58 T,. 
 Ed. 191 (1913); Smith v. Mayor, etc., of City of New York, 10 N. Y. 50^ 
 (18^3) ; Kelly v. City of Chicago, 62 111. 279 (1871) ; Spencer v. Harding, L. 
 B. 5 C. P. 561 (1870). ' 
 
12 OFFER AND ACCEPTANCE (Ch. 1 
 
 what response you got to the telegram you sent while I was there. I 
 have had to turn all of my work over to the bonding companies as I 
 ■was unable to pull through. It will help me a great deal if you will 
 give me some information about the Spokane job and also the Tacoma 
 job. I have been expecting a letter from you daily since my return 
 but so far have received none. Thanking you in adavnce, I am, yours 
 very truly, Phil E. Dunnavant." 
 
 To this the appellant answered by the following letter: "Feb. 28, 
 1910. Mr. Phil E. Dunnavant, Portland, Oregon — Dear Sir : In an- 
 swer to yours of last week, will, say that under the circumstances it 
 will be impossible to do the work as we talked of in our talk when you 
 were up here and will have to arrange with some other contractor to 
 do the work at Spokane and Tacoma. Am sorry but cannot do any- 
 thing else as it has turned out. Yours truly, W. H. Dennis & Son." 
 
 To this letter the appellant replied : "Portland, Oregon. March 2, 
 1910. Mr. W. H. Dennis, Seattle, Wash.— Dear Sir : Your letter of 
 the 28th ult. received and carefully noted, under existing circumstanc- 
 es I do not feel like letting the contracts for the Tacoma and Spokane 
 jobs go as there is good prospects in them for me, if I can make no 
 other arrangements with you I will have to carry them on as was first 
 intended. I will probably be in Seattle some time in the near future 
 and will talk the matter over with you but in the meantime would like 
 to know just how the work stands on the two jobs as I have my men 
 ready to go on short notice. Trusting that I will hear from you as 
 soon as possible I beg to remain. Yours very truly, Phil E. Dunna- 
 vant." 
 
 No formal contract was ever forwarded for execution by Dunna- 
 vant and none in fact was entered into, and thereafter the appellant 
 prosecuted the work described in the writing through other parties. 
 After the completion of the work, Dunnavant assigned his claim to 
 the present respondent, who brought this action on the accepted writ- 
 ing to recover damages as for breach of contract. The cause was 
 tried in the court beloW by the judge, sitting without a jury, and re- 
 sulted in a judgment in favor of the respondent for the full amount 
 claimed, namely, $1,700. To reverse the judgment, this appeal is pros- 
 ecuted. 
 
 The principal question suggested by the record is whether the writ- 
 ing containing the bid of Dunnavant and the acceptance thereof by 
 the appellant constituted the completed contract between the parties, 
 or was it an agreement settling some of the terms of a contract to be 
 entered into later. The face of the writing, it is at once apparent, in- 
 dicates that it was intended as the latter, rather than the former. Aft- 
 er specifying certain particulars, it expressly provides that a formal 
 contract is to follow. If the, writing itself was intended as the com- 
 pleted contract, there would have been no need for this proviso; A 
 contract complete in itself does not need the sanction of another con- 
 tract. 
 
Sec. 1) INOPERATIVE PKEIJMINARY NEGOTIATION 13 
 
 Again, the contract, when tested by the surrounding circumstances, 
 seems incomplete. It refers to work of a particular character in a de- 
 scribed building, yet it specifies no time when the work shall be begun, 
 when it shall be completed, the character of the work that shall be per- 
 formed, or when payment for the work shall be made. While the law 
 in such cases implies certain conditions, namely, that the work shall 
 be commenced and completed within a reasonable time after demand, 
 shall be performed in an ordinarily skillful manner, and shall be paid 
 for within a reasonable time after its completion, it is apparent that 
 these conditions might not satisfy the appellant. He was a subcontrac- 
 tor of Thompson- Starrett Company, and bound to perform according 
 to the stipulations of his written contract with them, which might va- 
 ry materially from the stipulations implied by law. This being true, 
 the appellant very naturally would want the contract under which the 
 work was to be actually performed conditioned so as to accord with 
 his contract with the original builder. The writing, in whatever as- 
 pect it is viewed, therefore, seems to us to point to the conclusion that 
 it was not intended to be the final agreement between the parties. 
 
 The evidence also, we think, sustains this conclusion. The appel- 
 lant testifies to the fact positively, and Dunnavant admits that such a 
 thing was talked over between them, but that the purpose was to put 
 the contract in more formal shape, rather than supply any further de- 
 tails. Both parties were men of ability and experience, and it would 
 hardly seem that if they intended this writing to be a complete contract 
 between them they would solemnly provide, both in writing and orally, 
 for a further agreement. 
 
 By the conditions of the writing, it was Dunnavant's duty, after the 
 acceptance by the appellant of the terms proposed, to prepare a formal 
 contract embodying such terms and such further details as the char- 
 acter of the work required, and forward the same to the appellant for 
 execution. Failing in this, he had no cause of action against the ap- 
 pellant, as the appellant could not otherwise be put in default, and of 
 course no cause of action passed to his assignee by the assignment. 
 
 The judgment appealed from is reversed and the case remanded, 
 with instructions to enter a judgment in favor of the appellant to the 
 effect that the respondent take nothing by his action.* 
 
 8 In Mississippi & D. S. S. Co. v. Swift, 86 Me. 248, 29 Atl. 1066, 41 Am. 
 St. Rep. 545 (1894), Emery, J., said: "From these expressions of courts and 
 jurists, it is quite clear tbat, after all, the question is mainly one of inten- 
 tion. If the party sought to be charged intended to close a contract prior to 
 the formal signing of a written draft, or if he signified such an intention to 
 the other party, he will be bound by the contract actually made, though the 
 signing of the written draft be omitted. If, on the other hand, such party 
 neither had nor signified such an intention to close the contract until it was 
 fully expressed in a written instrument and attested by signature, then he will 
 not be bound until the signatures are affixed. The expression of the idea may 
 be attempted in other words: if the written draft is viewed by the parties 
 merely as a convenient memorial, or record of their previous contract, its ab- 
 sence does not affect the binding force of the contract ; If, however, it is 
 
14 OFFEE AND ACCEPTANCE (Ch. 1 , 
 
 BILLINGS V. WILBY. 
 (Supreme Court of North Carolina, 1918. 175 N. C. 571, 96 S. E. 50.) 
 
 , Action, by A- U. Billings against William Wilby. Judgment for 
 plaintiff, and defendant excepts and appeals. No error. 
 
 Hoke, J.° There was evidence on the part of the plaintiff tending to 
 show that plaintiff, a contractor of extended experience and engaged 
 at the time in "grading off the foundation" for the new federal build- 
 ing at Wilkesboro, N. C, on January 16, 1916, received a letter from 
 William Wilby, defendant, then at Selma, Ala., and who had the sub- 
 contract for the plumbing and laying the sewer line, inviting a propo- 
 sition from plaintiff for cutting the ditch and laying the line, etc., ac- 
 cording to survey and specifications which had been already made by 
 the government; that on January 13, 1916, plaintiff replied by tele- 
 gram from North Wilkesbqro, as follows: 
 
 "Will put in sewer line according to specifications for five hundred 
 dollars you furnish pipe and material North Wilkesboro wire at once 
 if you accept this. [Signed] A. U. Billings." 
 
 On same date defendant sent by wire a night letter as follows : 
 "Forty cents per running foot is best I can do I furnish pipe and you 
 cement. I can do it myself for less than this but want it put in before 
 my njan comes. If I cannot get it for the above amount will wait 
 and put it in myself. [Signed] William Wilby." 
 
 To this plaintiff replied by telegram at 10 :40 a. m. January 14 : 
 "Night letter received. Will accept. Send contract signed at once." 
 That plaintiff was ready, able, and willing to do the work, and had 
 the hands and tools there for the purpose, and on the night before he 
 was to begin, which was several days after plaintiff's last message, , 
 plaintiff received a telegram from defendant to the effect that he 
 
 viewed as consummation of the negotiation, there is no contract until the 
 written draft Is finally signed." It was held that there was no contract. 
 
 In the following cases, also, it was held that the execution of the written 
 document was contemplated by the parties as the final operative fact, prior 
 to which there was no contract: Spinney v. Downing, 108 OaL 666, 41 Pac. 797 
 (1895) ; Las Palmas Winery & Distillery v. Garrett & Co., 167 Cal. 397, 139 
 Pac. 1077 (1914) ; Ocala Cooperage Co. v. Florida Cooperage Co., 59 Fla. 390 
 52 South. 13 (1910) ; Strong & Trowbridge Co. v. H. Baars & Co., 60 Fla. 
 253, 54 South. 92 (1911) ; Scott v. Fowler, 227 111. 104, 81 N. B. 34 (1907) ; 
 Alexandria Billiard Co. v. Miloslowsky, 167 Iowa, 395, 149 N. W. 504 (1914) ; 
 Tucker v. Pete, Sheeran Bros. & Co., 155 Ky. 670, 160 S. W. 176 (1913) ■ Bar- 
 relli V. Wehrli, 121 La. 540, 46 South. 620 (1908) ; Donnelly v. Currie Hard- 
 ware Co., 66 N. J. Law, 388, 49 Atl. 428 (1901) ; Williams v. Burdick, 63 Or 
 '41, 125 Pac. 844, 126 Pac. 603 (1912). In Kidgway v. Wharton, 6 H. L. Cas. 
 238, 268 (1857) it was said that "the circumstance that the parties do intend 
 a subsequent agreement to be made is strong evidence to show that they did 
 not intend the previous negotiations to amount to an agreement." In Rossdale 
 V. Denny, [1921] 1 Ch. 57, a letter contained several proposed terms and then 
 said: "Suhj^t to a formal contract to embody such reasonable provisions 
 as my solicitors may approve." The court reviewed the cases where the woi'ds 
 ''subject to" had been used, and it held there was no contract. 
 
 3 The statement of facts is omitted.- 
 
Sec. 1) INOPERATIVE PBELIMINAEY NESOTIATION 15 
 
 would advise plaintiflE in a day or two about the work ; that defendant 
 never did advise plaintiff further about it, but soon thereafter under- 
 took the work himself, etc. ; that plaintiff's damage in the loss of the 
 contract was about $250. On matters relevant to the issue, defendant 
 introduced his own deposition to the effect "that he was a plumber 
 resident in Selma, Ala., and had a subcontract for installing the plumb- 
 ing and sewer for the building and in addition to the telegrams already 
 in evidence, there was attached to his deposition two other telegrams 
 in terms as follows ; one purporting to be from plaintiff to defendant, 
 dated January 18,"'3 p. m. ; 
 
 "I accept your sewer proposition wire at once if you accept mine 
 start work at once in the morning. [Signed] A.U.Billings." 
 
 — and another from defendant to plaintiff: 
 
 "Will advise you within next few days regarding sewer proposition. 
 
 "[Signed] William Wilby." 
 
 In reference to the additional telegrams attached to the deposition 
 and purporting to be from plaintiff, "I accept your sewer proposition 
 wire at once if you accept mine start work in the morning," plaintiff re- 
 called testified that he did not send nor authorize any one else to send 
 such a telegram. On perusal of this evidence, we are clearly of opin- 
 ion that a definite contract to let the work in question was constituted 
 between these parties by the telegram of plaintiff, dated January 14th, 
 in reply to defendant's night letter and in terms, "Night letter receiv- 
 ed will accept send contract signed at once," and this result is not affect- 
 ed by the closing words of the message, "Send contract signed," etc. — 
 this by correct interpretation meaning merely that it was the desire and 
 preference of the plaintiff that the agreement they had made should 
 be written out and formally signed by the parties, and it is the recog- 
 nized position here and elsewhere that, when the parties have entered 
 into a valid and binding agreement, the contract will not be avoided be- 
 cause of their intent and purpose to have the same more formally 
 drawn up and executed, and which purpose was not carried out. 
 Gooding v. Moore, 150 N. C. 195, 63 S. E. 895; teal v. Templeton, 
 149 N. C. Z2, 62 S. E. 737 ; Sanders v. Pottlitzer Bros. Fruit Co., 144 
 N. Y. 209, 39 N. E. 75, 29 L. R, A. 431, 43 Am. St. Rep. 757; Clark 
 on Contracts (2d Ed.) p. 29, and authorities cited. In Moore's Case, 
 supra, it was held : 
 
 "That when parties to an oral contract contemplate a subsequent 
 reducing of it to. writing, as a matter of convenience and prudence and 
 not as a condition precedent, it is binding on them, though their intent 
 to formally express the agreement in writing was never carried out." 
 
 And in 144 N. Y., supra: 
 
 "If the correspondence and telegrams between the parties contain 
 all the details of a contract, it is enforceable, though they intended 
 that their agreement should be formally expressed 'in a single paper 
 which, when signed, should be the evidence of what already had been 
 agreed upon." 
 
16 OFFER AND ACCEPTANCE (Ch. 1 
 
 This being the correct position, we must approve his honor's charge 
 on the first issue : 
 
 "That, if the jury believe the evidence and find the facts to be as 
 testified by the witness and disclosed by the documents produced in 
 evidence, you will answer the first issue Yes." 
 
 The parties having entered into a definite contract by the message 
 from the plaintiff, of date January 14th, the additional message intro- 
 duced by the defendant, even if genuine, evinces no purpose to aban- 
 don any rights he had acquired or to reopen the question of what had 
 been done between them, and, if it were Otherwise, the charge of his 
 honor, when considered in reference to the testimony and the conditions 
 presented, could only mean, and v/as clearly intended to mean, that, if 
 the parol evidence given by plaintiff to the effect that he had never sent 
 this telegram or authorized any one else to do so should be accepted by 
 the jury, and, the fact so found, such message should not be allowed to 
 affect the determination of the issue. 
 
 On the record, we find no error in the charge or in the refusal of the 
 motion to nonsuit, and the judgment below must be affirmed. 
 
 No error.^" 
 
 10 In the following cases It was held that the written document was con- 
 templated as a mere memorial, not as the only operative fact, and that a con- 
 tract was made without it: Brogden v. Metrop. Ry. Co. (H. L.) 2 App. Cas. 
 666 (18T7) ; Eossiter v. Miller, 3 App. Oas. 1124 (1878) ; Jenkins & Reynolds 
 Co. V. Alpena Portland Cement Co., 147 Fed. 641, 77 C. C. A. 625 (1906); 
 Wehner v. Bauer (C. 0.) 160 Fed. 240 (1008) ; Thomas B. Whitted & Co. v. 
 Fairfield Cotton Mills, 210 Fed. 725, 128 O. C. A. 219 (1913) ; U. S. v. P. J. 
 Carlin Const Co., 224 Fed. 859, 138 C. C. A. 449 (1915) ; Southern R. Co: v. 
 Huntsville Lumber Co., 191 Ala. 333, 67 South. 695 (1914); Skeen v. Ellis, 
 105 Ark. 513, 152 S. W. 153 (1912) ; Alexander Amberg & Co. v. Hollis, 115 
 Ark. 589, 171 S. W. 915 (1914) ; Conner v. Plank, 25 Cal. App. 516, 144 Pae. 
 295 (1914), writing mentioned after complete agreement; Hollerbach & May 
 Contract Co. v. Wilkins, 130 Ky. 51, 112 S. W. 1126 (1908); Berman v. Rosen- 
 berg, 115 Me. 19, 97 Atl. 6 a916) ; Bollenbacher v. Reid, 155 Mich. 277, 118 
 N. W. 933 (1908) ; McGonnell v. Harrell & Nicholson Co;, 183 Mich. 369, 149 
 N. W. 1042 (1914) ; Lamoreaux v. Weisman, 136 Minn. 207, 161 N. W. 504 
 (1917); Allen v. Chouteau, 102 Mo. 309, 14 S. W. 869 (1890); Long v. Need- 
 ham, 37 Mont. 408, 96 Pac. 731 (1908) ; Sanders v. Pottlitzer Bros. Fruit Co., 
 144 N. T. 209, 39 N. E. 75, 29 L. R. A. 431, 43 Am. St. Rep. 757 (1894) ; Good- 
 ing V. Moore, 150 N. O. 195, 63 S. E. 895 (1909) ; Jungdorf v. Town of Little 
 Rice, 156 Wis. 466, 145 N. W. 1092 (1914). 
 
 An offer may be accepted orally, even though made in the form of a con- 
 tract signed by the offerer. Glackin v. Bennett, 226 Mass. 316, 115 N. E. 490 
 (1917). 
 
 In Cottingham v. National Mut. Church Ins. Co., 290 111. 26, 124 N. E. 822 
 (1919), a binding insurance contract was held to exist, even though no formal 
 policy was ever issued. 
 
Sec. 2) COMMUNICATION OP OFFEK 17 
 
 SECTION 2.— COMMUNICATION OF OFFER 
 
 WILUAMS V. CARWARDINE. 
 (In the King's Bencli, 1S33. 4 Barn. & Adol. 621.) 
 
 Assumpsit to recover £20, which the defendant promised to pay to 
 any person who should give such information as might lead to a dis- 
 covery of the murderer of Walter Carwardine. Plea, general issue. At 
 the trial before Parke, J., at the last spring assizes for the county of 
 Hereford, the following appeared to be the facts of the case: One 
 Walter Carwardine,, the brother of the defendant, was seen on the eve- 
 ning of March 24th, 1831, at a public-house at Hereford, and was not 
 heard of again till his body was found on April 12th in the river Wye, 
 about two miles from the city. An inquest was held on the body on 
 April 13th and the following days till the 19th ; and it appearing that 
 the plaintiff was at a house with the deceased on the night he was sup- 
 posed to have been murdered, she was examined before the magis- 
 trates, but did not then give any information which led to the appre- 
 hension of the real offender. On April 2Sth th? defendant caused a 
 hand-bill to be published, stating that whoever would give such infor- 
 mation as should lead to a discovery of the murderer of Walter Car- 
 wardine should, on conviction, receive a reward of £20; and any per- 
 son concerned therein, or privy thereto (except the party who actually 
 committed the offense), should be entitled to such reward, and every 
 exertion used to procure a pardon ; and it then added, that informa- 
 tion was to be given, and application for the above reward was to be 
 made to Mr. William Carwardine, Holmer, near Hereford. Two per- 
 sons were tried for the murder at the summer assizes 1831, but ac- 
 quitted. 
 
 Soon after this, the plaintiff was severely beaten and bruised by one 
 Williams, and on August 23d, 1831, believing she had not long to live, 
 and to ease her conscience, she made a voluntary statement, containing 
 information which led to the subsequent conviction of Williams. Up- 
 on this evidence it was contended, that as the plaintiff was not induced 
 by the reward promised by the defendant to give evidence, the law 
 would not imply a contract by the defendant to pay her the £20. The 
 learned Judge was of opinion, that the plaintiff, having given the in- 
 formation which led to the conviction of the murderer, had performed 
 the condition on which the £20 was to become payable, and was there- 
 fore entitled to recover it; and he directed the jury to find a verdict 
 for the plaintifif, but desired them to find specially whether she was 
 induced to give the information by the offer of the promised reward. 
 The jury found that she was not induced by the offer of the reward,, 
 but by other motives. 
 
 COBBIN CONT 2 
 
18 OFFER AND ACCEPTANCE (Cll. 1^ 
 
 Curwood now moved for a new trial. There was no promise to pay 
 the plaintifif the sum of £20, That promise could only be enforced in 
 favor of persons who should have been induced to make disclosures 
 by the promise of reward. Here the jury have found that the plaintiff 
 was induced by other motives to give the information. They have, 
 therefore, negatived any contract on the part of the defendant with 
 the plaintiff. 
 
 Dbnman, C. J. The plaintiif , by having given information which led 
 to the conviction of the murderer of Walter Carwardine, has brought 
 herself within the terms of the advertisement, and therefore is entitled 
 to recover. 
 
 LittlsdalE, J. The advertisement amounts to a general promise, to 
 give a sum of money to any person who shall give information which 
 might lead to the discovery of the offender. The plaintiff gave that 
 information. 
 
 Parke, J. There was a contract with any person who performed the 
 condition mentioned in the advertisement. 
 
 Patteson, J. I am of the same opinion. We cannot go into the 
 plaintiff's motives. 
 
 Rule refused. 
 
 DAWKINS V. SAPPINGTON. 
 (Supreme Court of Indiana, 1866. 26 Ind. 199.) 
 
 Frazer, J. *The appellant was the plaintiff below. The complaint 
 was in two paragraphs : (1) That a horse of the defendant had been 
 stolen, whereupon he published a hand-bill offering a reward of $50 
 for the recovery of the stolen property, and that thereupon the plain- 
 tiff rescued the horse from the thief and restored him to the defend- 
 ant, who refused to pay the reward. (2) That the horse of the defend- 
 ant was stolen, whereupon the plaintiff recovered and returned him to 
 the defendant, who, in consideration thereof, promised to pay $50 to 
 the plaintiff, which he has failed and refused to do. 
 
 To the second paragraph a demurrer was sustained. To the first 
 an answer was filed, the second paragraph of which alleged that the 
 plaintiff', when he rescued the horse and returned him to the defendant, 
 had no knowledge of the offering of the reward. The third para- 
 graph averred that the hand-bill offering the reward was not publish- 
 ed until after the rescue of the horse and his delivery to the defend- 
 ant. The plaintiff unsuccessfully demurred to each of these para- 
 graphs, and refusing to reply the defendant had judgment. * * * 
 
 3. The second paragraph of the answer shows a performance of the 
 service without the knowledge that the reward had been offered. The 
 offer thej-ef ore did not induce the plaintiff to act. The liability to pay 
 .a reward offered seems to rest, iri some cases, upon an anomalous doc- 
 
 *Part of the opinion is omitted. 
 
Sec. 2) COMMUNICATION OF OFFER 19 
 
 trine, constituting an exception to the general riile. In Williams v. 
 Carwardine, 4 Barn. & Adolph. 621, there was a special finding, with 
 a general verdict for the plaintiff, that the information for which the 
 reward was offered was not induced to be given by the offer, yet it was 
 held by all the judges of the King's Bench then present, Denman, C. ]., 
 and Littledale, Parke and Patteson, JJ., that the plaintiff was entitled 
 to judgment. It was put upon the ground that the offer was a general 
 promise to any person who would give the information sought; that 
 the plaintiff, having given the information, was within the terms of the 
 offer, and that the court could not go into the plaintiff's motives. This 
 decision has not, we believe, been seriously questioned, and its reason- 
 ing is conclusive against the sufficiency of the defense under examina- 
 tion. There are some considerations of morality and public policy 
 which strongly tend to support the judgment in the case cited. If the 
 offer was made in good faith, why should the defendant inquire wheth- 
 er the plaintiff knew that it had been made ? Would the benefit to him 
 be diminished by the discovery that the plaintiff, instead of acting from 
 mercenary motives, had been impelled solely by a desire to prevent the 
 larceny from being profitable to the person who had committed it ? Is 
 it not well that any one who has an opportunity to prevent the success 
 of a crime, may know that by doing so he not only performs a virtuous 
 service, but also entitles himself to whatever reward has been offered 
 therefor to the public ? 
 
 The judgment is reversed, with costs, and the cause remanded, with 
 directions to the court below to sustain the demurrer to the second par- 
 agraph of the answer.^^ 
 
 TAFT et al. v. HYATT et al. 
 (Supreme Court of Kansas, 1919. 105 Kan. 35, 180 Pac. 213.) 
 
 Suit by B. L. Taft and others against William S. Hyatt and others 
 in nature of interpleader to determine the right to a reward. From 
 a decree for defendant named, the remaining defendants appeal. Re- 
 versed and remanded, with directions. 
 
 Porter, J.^^ The controversy is between rival claimants for a re- 
 ward offered for the apprehension of a criminal. The suit is an eq- 
 
 ( 
 
 11 The following cases held the offerer bound to pay the reward to one who 
 rendered part or all of the service without knowledge of the offer: Gibbons 
 V. Proctor, 64 I/. T. 594 (1892) ; Neville v. Kelly, 12 C. B. (N. S.) 740 (1862) ; 
 Auditor v. Ballard, 9 Bush (Ky.) 572, 15 Am. Eep. 728 (1873) ; Coffey v. Com., 
 18 Ky. Law Kep. 646, 37 S. W. 575 (1896) ; Russell v. Stewart, 44 Vt. 170 
 (1872) ; Stone v. Dysert, 20 Kan. 123 (1878), plaintiff knew that a reward 
 had been offered, but not by whom or on what terms; Cummings v. Gann, 
 52 Pa. 484 '(1866) ; Smith v. State, 38 Nev. 477, 151 Pae. 512, L. R. A. 1916A, 
 1276 (1915) ; Eagle v. Smith, 4 Houst. (Del.) 293 (1871) ; Sullivan v. Phillips, 
 178 Ind. 164, 98 N. E. 868, Ann. Cas. 1915B, 670 (1912) ; Drummond v. U. S., 
 35 Ct. CI. 356 (1900). See 26 Yale L. Jour. 169, 182 ; 29 Hary. L. Rev. 221 ; 1 
 Cornell L. Q. 92. 
 
 12 Parts of the opinion are omitted. 
 
20 OFFER AND ACCEPTANCE (Ch, 1 
 
 uitable one instituted by the persons who offered the reward, and who 
 alleged that they were threatened with litigation by different par- 
 ties claiming it, that some one or more of the defendants are entitled 
 to the money, which the plaintiffs brought into court, and asked that 
 defendants be required to set up their respective claims. 
 
 On May 16, 1917, it became known in the city of Parsons that Ag- 
 nes Smith, the wife of Dr. Asa Smith, had been assaulted, and that 
 a negro physician by the name of Robert E. Smith was suspected 
 of the crime. (The victim of the assault died, and Robert E. Smith 
 was charged with and convicted of murder in the first degree. The 
 judgment was affirmed. State v. Smith, 103 Kan. 148, 174 Pac. 
 551.) 
 
 The plaintiffs are Dr. Asa Smith, husband of the murdered wo- 
 man, and certain individuals who are members of the A. H. T. A. 
 They caused to be published and circulated an offer of $750 reward 
 "for the arrest or information that will lead to" the arrest of the 
 ^ accused. 
 
 As to the claims of the defendant Wm. S. Plyatt, the findings of 
 fact are, in substance, these : Hyatt is an attorney at law with an office 
 in the city of Parsons. Another attorney notified him that R. E. Smith 
 desired to see him, and told him where Smith could be found. During 
 the afternoon of May 17, 1917, Hyatt went to the hiding place of the 
 accused in the city of Parsons in compliance with the directions that had 
 been given him, and there found Smith. The two talked together for 
 an hour or more, but were unable to reach an agreement as to the em- 
 ployment of Hyatt to defend Smith. There is a finding that the relation 
 of attorney and client never existed between them at any time, and that 
 Hyatt came away without being employed. Shortly before he went to 
 see Smith, Hyatt learned that the reward had been offered, and after re- 
 turning from his interview, he went to the office of the county at- 
 torney and told him where Smith could be found, and an arrangement 
 was made to have the deputy sheriff go to the place for the purpose 
 of arresting Smith. The deputy sheriff was called, and with Hyatt 
 drove to the place where Smith had been left by Hyatt earlier in the 
 afternoon, when they discovered that Smith was not there, but had 
 been taken away by the other defendants. The court further found 
 that Hyatt gave the first information to the proper officers ^^ which 
 would lead to the arrest of Smith after the offer of the reward had 
 been made, and that the information was given more than an hour 
 previous to the time Smith was removed by the other defendants from 
 the house where he had been hiding, and that Hyatt's purpose in giv- 
 ing the information to the county attorney and the deputy sheriff was 
 to obtain the reward offered by the plaintiffs; that the fact that 
 Smith was. not arrested from the information given by Hyatt was 
 
 13 Giving the Information to a disinterested person in general conversation 
 is no acceptance. Lockhart v. Barnai'd (Bxcli.) 14 M. & "W. 674 (1845). 
 
Sec. 2) COMMUNICATION OF OFFER 21 
 
 due to no. fault or neglect of Hyatt. As a conclusion of law the court 
 held that Hyatt was entitled to the reward. 
 
 The findings with reference to the other claimants are that Clarence 
 Glass and Charles C. Edwards went to Thomas A. Murry, the chief 
 of police of the city of Parsons, shortly after 6 o'clock on the after- 
 noon of May 17, 1917, and requested Murry to go in a closed cab to 
 a certain place in the city and take charge of Smith and deliver him 
 to the jail at Oswego. Murry complied with the request, and went to 
 the place directed, where he found the accused, together with the 
 defendants Glass, Edwards, Tyson, Cook, and Ransoni. All of them 
 got into the cab with the chief of police, and the party went to Oswego, 
 where Smith was delivered to the sheriff of Labette county. Before 
 leaving Parsons, and just as the party got into the cab with the chief 
 of police, the latter told the accused to consider himself under arrest, 
 and informed him of the intention to deliver him at the county jail 
 at Oswego. The evidence shows that the defendants who secured the 
 services of the chief of police in taking the accused to Oswego were 
 all members of the Lodge of Colored Masons, tp which the accused 
 belonged. The court finds that Smith expressed to them his fears of 
 mob violence, and it was agreed that he would give himself into 
 their custody, and they agreed to protect hini; that none of these 
 defendants had heard of the offer of reward at the time they called 
 Murry, the chief of police, to their assistance. Murry testified that 
 he had heard of the reward before he arrested Smith, and that the 
 reason he placed him under arrest and took him to Oswego was partly 
 to earn the reward and partly to protect Smith from mob violence. 
 The court finds that it was the duty of Murry, as chief of police, to 
 make arrest of fugitives from justice, that at the time of receiving 
 Smith into custody Murry was not armed with a warrant or other 
 process for the arrest, and that Smith had not committed any of- 
 fense within the view of the chief of police. 
 
 The court found in favor of Hyatt and against the other defend- 
 ants. The costs were directed to be paid out of the fund, and the bal- 
 ance of the $750 was ordered paid to Hyatt. The other defendants 
 bring the case here for review. * * * 
 
 It is urged that it would be unconscionable to permit an attorney, 
 under such circumstances, to avail himself of an offer of reward ; that 
 to, do so would sanction conduct highly unprofessional in an attor- 
 ney, and would permit him to obtain from one who occupies the po- 
 sition of a prospective client information which he uses to the oth- 
 er's prejudice and to gain a pecuniary benefit to himself. Without 
 passing upon the question of the propriety of the conduct of an at- 
 torney in attempting to obtain a pecuniary advantage to the prejudice 
 of an accused person under such circumstances, we think that Hyatt is 
 not entitled to recover, because, from his own statement and the un- 
 disputed facts in evidence, his efforts to secure the apprehension of 
 the accused were unavailing. The information which be gave to the 
 
22 OFFER AND ACCEPTANCE (Ch. 1 
 
 officers did not result, even remotel)«, in bringing about the apprehen- 
 sion of the accused. The court finds that the information Hyatt gave 
 would lead to the arrest of the guilty person if it had been acted upon 
 promptly, and the fact that it did not bring about this result was 
 through no fault of Hyatt's. But this finding does not help Hyatt's 
 case. It may have been that the officers to whom he confided his in- 
 formation were too slow. Whatever the reason, before any action 
 was taken by them which resulted in apprehending the accused, the 
 latter was on his way to the county jail in the custody of another offi- 
 cer, having, with the aid of his friends, surrendered himself. So far 
 as the apprehension of the guilty person was concerned, Hyatt might 
 as well have kept his information to himself. 
 
 The defendants who admit that they had not heard of the offer 
 of the reward until after the accused had been surrendered to the 
 sheriff at Oswego are not entitled to recover. A private offer of re- 
 ward for the apprehension of a fugitive from justice or of a person 
 suspected or charged with an offense stands, as a general rule, upon 
 a different footing from a statutory offer, or one made by virtue of a 
 statute. 34 Cyc. 1752, 1753, and cases cited in notes. The offer of a 
 private mdividual is a mere proposal, which, when accepted, becomes 
 a contract. Until it is accepted by some person who upon the strength 
 of the offer takes some steps to earn the reward, there is no contract. 
 Van VHssingen v. Manning, 105 111. App. 255. There must be a meet- 
 ing of the minds of the parties — on the one side, of the person who 
 makes the offer; on the other, of the person who performs the serv- 
 ice. Where a claimant for the reward was not aware that it had been 
 offered until after he had performed his services, there has be^ no 
 meeting of minds which would constitute a contract. Besides, the 
 undisputed facts with respect to those defendants who called the chief 
 of police to assist them in taking the accused to Oswego are that these 
 claimants were simply assisting the accused in surrendering himself. 
 Their testimony is that what they did was for the purpose of protecting 
 him from mob violence. They had never heard of the reward, and, 
 of course, are not entitled to any part of it.^* 
 
 14 In accord: Fitch v. Snedaker, 38 N. Y. 248, 97 Am. Dec. 791 (1868); 
 Vitty V. Eley, 51 App. Div. 44, 64 N. Y. Supp. 397 (1900) ; Sheldon v. George, 
 132 App. Div. 470, 116 N. Y. Supp. 969 (1909) ; Rowland v. Lounds, 51 N. Y. 
 604, 10 Am. Rep. 654 (1873); Williams v. West Chicago St. R. Co., 191 111 
 610, 61 N. E. 456, 85 Am. St. Rep. 278 (1901) ; Mayor, etc., of City of Hoboken 
 V. Bailey, 36 N. J. Law, 490 (1873) ; Stamper v. Temple, 6 Humph. (Tenn ) 
 113, 44 Am. Dec. 296 (1845) ; Hewitt v. Anderson, 56 Cal. 476, 38 Am. Rep. 65 
 (1880) ; Fidelity & Deposit Co. of Maryland v. Messer, 112 Miss. 267, 72 South 
 1004 (1916) ; Chicago & A. R. Co. v. Sebring, 16 111.^ App. 181 (1885) ; Board 
 of Trustees of Police Pension Fund of South Bend, Ind., v. Kentucky Ticket 
 Protective Bureau, 175 111. App. 464 (1912) ; Couch v. State, 14 N. D. 361 103 
 N. W. 942 (1905) ; Smith v. Vernon, 188 Mo. 501, 87 S. W. 949, 70 L. R A 
 59, 107 Am. St. Rep. 324 (1905) ; Broadnax v. Ledbetter, 100 Tex. 375 99 S 
 W. 1111, 9 L. R. A. (N. S.) 1057 (1907). 
 
 ' As to whether identical offers crossing in the mail make a contract see 
 Tlnn V. Hoffmann & Co., post, p. 155." ' 
 
Sec. 2) COMMUNICATION OF OFFER 23 
 
 Thomas A. Murry cannot recover, because, as chief of poHce of the 
 city of Parsons, it was his duty to make an arrest of fugitives from 
 justice or persons charged with or suspected of crimes. The fact 
 that he was not armed with a warrant or other process for the arrest 
 of the accused is immaterial, because there was reasonable ground for 
 believing that Smith had committed the particular offense charged 
 against him, and his subsequent conviction established his actual 
 guilt. * * * 
 
 It has been repeatedly held that public policy does not permit an offi- 
 cer to claim a reward for merely doing his duty.^'° * * * 
 
 Inasmuch as none of the defendants are entitled to recover any part 
 of the reward, we think it would be a harsh rule to say that the plain- 
 tiffs are estopped from claiming it because of the admissions in their 
 petition. In our view' of the matter, justice requires that the trial court 
 be directed to render judgment against all of the defendants, and that 
 the plaintiffs, after paying the costs of the proceeding, be entitled 
 to the return of the money. ^'° 
 
 The judgment is reversed, and the cause remanded, with directions 
 to carry this order into effect. All the Justices concurring.^^ 
 
 15 The court cited authorities on this point. For cases herein, see post, 
 p. 381. 
 
 16 The discussion of the reasons for giving the plaintiff a judgment that he 
 did not asl£ in his bill of interpleader is mostly omitted. 
 
 17 In a number of cases, similar In many respects to the principal case, al- 
 though not in all, the reward was apportioned by the court among several 
 claimants, who had not acted jointly, but whose united efforts caused the 
 result desired by the offerer. Some of these were interpleader suits brought 
 by the offerer. Bloomfleld v. Maloney, 176 Mich. 548, 142 N. W. 785, Ann. Gas. 
 1915B, 662 (1913) ; Fargo v. Arthur, 43 How. Prac. (N. Y.) 193 (1872) ; Rochelle 
 V. Pacific Exp. Co., 56 Tex. Civ. App. 142, 120 S. W. 543 (1909). Others were 
 suits brought by one or more claimants. Whitcher v. State, 68 N. H. 605, 
 34 Atl. 745 (1894) ; Goldsborough v. Oradie, 28 Md. 477 (1867) ; Chambers v. 
 Ogle, 117 Ark. 242, 174 S. W. 532 (1915) ; Lancaster v. Walsh, 4 M. & W. 14 
 (1835). 
 
 Where a reward is offered for lost property, it has been held that one who 
 returns a part is entitled pro tanto. Deslondes v. Wilson, 5 La. 397, 25 Am. 
 Dec. 187 (1833); Symmes v. Frazier, 6 Mass. 344, 4 Am. Dec. 142 (1810); 
 Hawk V. Marion County, 48 Iowa, 472 (1878). 
 
 Apportionment was refused where a reward was offered for two persons 
 and only one was captured. Blain v. Pacific Express Co., 69 Tex. 74, 6 S. W. 
 679 (1887). 
 
 A reasonable construction must be given to the published offer. A reward 
 for "arrest and conviction" can be earned without personally arresting the 
 criminal. Doing acts that are the substantial cause of the arrest and convic- 
 tion is enough. ElMns v. Board of Com'rs of Wyandotte County, 91 Kan. 518, 
 138 Pac. 578, 51 L. R. A. (N. S.) 638, Ann. Cas. 1915D, 257 (1914); Id., 86 
 Kan. 305, 120 Pac. 542, 46 L. R. A. (N. S.) 662 (1912) ; Stone v. Dysert, 20 
 Kan. 123 (1878) ; Hall v. State, 102 Wash. 519, 173 Pac. 429 (1918) ; Choice v. 
 Dallas, infra. Cf. Shuey v. TTnited States, post, p. 178. McOlaughry v. King, 
 147 Fed. 463, 79 0. C. A. 91, 7 L. R. A. (N. S.) 216, 8 Ann. Oas. 856 (1906). 
 
24 OFFER AND ACCEPTANCE (Ch. 1 
 
 CHOICE et al. v. CITY OF DALLAS. 
 (Court of CItU Appeals of Texas, 1919. 210 S. W. 753.) 
 
 Action by Mrs. M. P. Choice against the City of Dallas and A. E. 
 Firmin and wife, with cross-bill by defendant Firmin and wife. Gen- 
 eral and special exceptions urged by defendant city to plaintiff's peti- 
 tion and to the cross-bill sustained, and plaintiff and Firmin and wife 
 appeal. Reversed and remanded. 
 
 BoYCS, J.^* This suit was brought by appellant Mrs. M. B. Choice 
 against the city of Dallas to recover a reward offered by the city "for 
 the arrest and conviction of any one guilty of arson within the corpo- 
 rate limits of the city of Dallas." A. E. Firmin and wife, Mrs. Nellie 
 Firrnin, were made defendants on allegations that tlaey were claiming 
 the reward. These parties appeared, and by cross-bill sought to re- 
 cover the reward. The court sustained general and special exceptions 
 urged by tlie city to the plaintiff's petition and the cross-bill of Mrs. 
 Firmin, and this appeal complains of this action. 
 
 Plaintiff alleged in her petition that on January 27, 1917, her resi- 
 dence in the city of Dallas was destroyed by fire set by one Mary 
 Wright, who was by such act guilty of arson ; that the plaintiff secured 
 and furnished information and testimony that led to the arrest and 
 conviction of the said 'Mary Wright of said crime ; that at such time 
 there was in force in the city of Dallas an ordinance duly and legally 
 passed at a time long prior to the occuirrence of the fire, as follows : 
 
 "Arson Reward." 
 
 "Whereas, under provisions of law, the state fire insurance commis- 
 sion has provided that, where any city or town maintains a standing 
 reward of a sum equal to $1.00 for each one hundred of population for 
 the arrest and conviction of any one guilty of arson, in that event the 
 insurance key rate of such city or town is entitled to credit of 2% ; 
 and 
 
 "Whereas, the crime of arson results in loss of property, causes an 
 increase in insurance premiums, and frequently results in the loss of 
 ' life, and is one of the most serious crimes against society ; and 
 
 "Whereas, the city of Dallas has now a population of 130,000; and 
 
 "Whereas, the people of Dallas, through their city government, are 
 preparing to apply to the state insurance commission for a substantial 
 reduction in our insurance key rate : 
 
 "Now, therefore, be it resolved by the board of commissioners that 
 the city of Dallas hereby offers a standing reward in the sum of $1,- 
 300.00 for the arrest and conviction of any one guilty of arson within 
 the corporate limits of the city of Dallas, said reward, however, not to 
 apply to the fire marshal, nor any other officer, city, county or state, 
 who makes such arrest in the discharge of his official duties. 
 
 18 Parts of opinion are omitted. 
 
Sec. 2) COMMUNICATION OF OFFER 25 
 
 "Be it further resolved that the city fire marshal be, and that he is 
 hereby directed to have prepared and to post placards in all public 
 buildings in the city, showing that such reiward has been offered as 
 above described." 
 
 It is further alleged that notices of such reward were posted in ac- 
 cordance with the tei'ms of such ordinance, and that by the passage 
 thereof the city did secure the reduction in the key rate of insurance 
 for said city, as referred to in the ordinance; that the plaintiff, with 
 knowledge of, and acting under, said ordinance, secured and furnished 
 such information as caused the arrest and conviction of said Mary 
 Wright. Mrs. Firmin, joined by her husband, alleged in her cross-pe- 
 tition that she, and not the plaintiff, discovered the facts and furnished 
 the information which caused the arrest and conviction of the said 
 Mary Wright, and that she was entitled to the reward. This cross- 
 petition contained no allegations that the cross-petitioner had any 
 knowledge of the offer of reward or acted thereunder. 
 
 The demurrers to these pleadings of the plaintiff and cross-petition- 
 er were sustained on three grounds: (1) That the ordinance offering 
 said reward was void as not being within the powers conferred upon 
 the city by its charter; ^° (2) that it did not appear that either of said 
 claimants actually arrested the said Mary Wright; (3) that it did not 
 appear from the cross-petition of Mrs. Firmin that she had knowl- 
 edge of the offer of reward and was induced to act by reason thereof. 
 We will consider these in the order stated. * * * 
 
 The offer of a reward for "arrest and conviction" cannot be taken 
 literally, as the conviction at least requires the action of the courts of 
 the state. So it has been generally held that the terms of such an offer 
 are complied with when one acting thereunder secures and furnishes 
 information necessary to and which results in arrest and conviction by 
 the properly constituted authorities, and we think this is the rule that 
 should be applied in this case. Tobin v. McComb, 156 S. W. 237; 
 Haskell v. Davidson, 91 Me. 488, 40 Atl. 330, 42 L. R. A. 155, 64 Am. 
 St. Rep. 254; Kinn v. First Nat. Bank, 118 Wis. 537, 95 N. W. 969, 
 99 Am. St. Rep. 1012 ; Elkins v. Board of Wyandotte County, 86 Kan. 
 305, 120 Pac. 542, 46 L. R. A. (N. S.) 662 ; 34 Cyc. 1747.^" 
 
 It is settled in this state that the recovery of rewards offered by in- 
 dividuals is governed by the principles of the law of contract, and that 
 before recovery can be had it must appear that the party claiming the 
 reward knew of and acted upon the offer when the services for the 
 rendition of which the reward is claimed were rendered. Broadnax 
 v. Ledbetter, 100 Tex. 375, 99 S. W. 1111, 9 L. R. A. (N. S.) 1057. 
 The court in that case, however, suggests this distinction, which appel- 
 lant Mrs. Firmin seeks to apply in this case : 
 
 "While we have seen no such distinction suggested, it may well be 
 
 18 The city was held to have power. This part of the opinion is omitted. 
 2 Cf. Shuey v. United States, post, p. 178; 
 
26 OFFEE AND ACCEPTANCE (Ch. 1 
 
 supposed that a person might become legally entitled to a reward for 
 arresting a criminal, although he knew nothing of its having been of- 
 fered, where it was ofiEered in accordance with law by the govern- 
 ment. A legal right might in such a case be given by law without the 
 aid of contract." 
 
 A suggestion of such a distinction was also made in the cases of 
 Clinton County v. Davis, 162 Ind. 60, 69 N. E. 680, 64 L. R. A. 780, 1 
 Ann. Cas. 282, and Drummond v. United States (U. S.) 35 Ct. CI. 372. 
 The only case we have found in which the distinction was actually 
 applied is that of Smith v. State, 38 Nev. 477, 151. Pac. 512, L. R. A. 
 1916A, 1276. In that case the Governor of the state of Nevada, act- 
 ing under the provisions of an act of the L,egislature, ofifered a reward 
 for the arrest and conviction of the murderers- of certain ranchmen, 
 and the plaintiffs, who claimed the reward, were not aware of the fact 
 that it had been offered when they did the acts on account of which 
 the reward was claimed. The case of Broadnax v. Ledbetter, supra, 
 was referred to in the opinion, and the above paragraph from the deci- 
 sion was quoted with approval, and it was concluded by the court that 
 in cases of this kind it was not contemplated by the Legislature that 
 any contractual relation was necessary; "that the right to the reward 
 follows by operation of law if a compliance with the provisions of the 
 statute has been shown." 
 
 It seems that a general reward offered by the government is re- 
 garded by these authorities somewhat in the nature of a bounty. ' While 
 an ordinance is not a law, in one sense of the word it is a local law, 
 emanating from legislative authority and operative within its limited 
 sphere as effectively as a general law of the sovereignty. Words and 
 Phrases, vol. 6, p. 5024 ; Second Series, vol. 3, p. 77. Following these 
 authorities, we hold that it was not necessary for the cross-petitioner 
 to allege knowledge of the existence of the reward at the time she took 
 action to secure the arrest and conviction of Mary Wright. * * * 
 
 We are of the opinion that the court erred in sustaining the excep- 
 tions to the petition and cross-petition, and the case will be reversed 
 and remanded:^^ 
 
 21 The first" person giving the required information is entitled to the whole 
 reward. United States v. Simons (D. C.) 7 Fed. 709 (1881) ; Lancaster v 
 Walsh (Exch.) 4 M. & W. 16 (1838). 
 
 In Lockhart v. Barnard (Exch.) 14 M. & W. 674 (1845) Parke, B., said: "Ac- 
 cording to the true construction of the advertisement, the information must be 
 given, with a view to its being acted on, either to the person offering the re- 
 ward, or his agent, or some person having authority by law to apprehend the 
 criminal." A mere statement to a disinterested third person in general con- 
 versation was no acceptance. 
 
Sec. 3) ACCEPTANCE BY POST 27 
 
 SECTION 3.— ACCEPTANCE BY POST 
 
 ADAMS V. LINDSELU 
 (In the King's Bench, 1818. 1 Barn. & Aid. 681.) 
 
 Action for non-delivery of wool according to agreement. At the trial 
 at the last Lent assizes for the county of Worcester, before Burrough, 
 J., it appeared that the defendants, who were dealers in wool, at St. 
 Ives, in the county of Huntingdon, had, on Tuesday, September 2, 
 1817, written the following letter to the plaintiffs, who were woolen 
 manufacturers residing in Bromsgrove, Worcestershire: "We now 
 offer you eight hundred tods of wether fleeces, of a good fair quality 
 of our country wool, at 35s. 6d. per tod, to be delivered at Leicester, 
 and to be paid for by two months' bill in two months, and to be 
 weighed up by your agent within fourteen days, receiving your answer 
 in course of post." 
 
 This letter was misdirected by the defendants, to Bromsgrove, 
 Leicestershire, in consequence of which it was not received by the 
 plaintiffs in Worcestershire till 7 p. m. on Friday, September 5th. 
 On that evening the plaintiffs wrote an answer, agreeing to accept the 
 wool on the terms proposed. The course of the post between St. 
 Ives and Bromsgrove is through London, and consequently this an- 
 swer was not received by the defendants till Tuesday, September 9th. 
 On Monday, September 8th, the defendants not having, as they ex- 
 pected, received an answer on Sunday, September 7th (which in case 
 their letter had not been misdirected woulc^ have been in the usual 
 course of the post), sold the wool in question to another person. Un- 
 der these circumstances the learned judge held, that the delay having 
 been occasioned by the neglect of the defendants, the jury must 
 take it, that the answer did come back in due course of post; and 
 that then the defendants were liable for the loss that had been sustained, 
 and the plaintiffs accordingly recovered a verdict. 
 
 Jervis having in Easter Term obtained a rule nisi for a new trial, 
 on the ground that there was no binding contract between the parties. 
 
 Dauncey, Puller & Richardson showed cause. They contended that 
 .at the moment of the acceptance of the offer of the defendants by 
 the plaintiffs the former became bound. And that was on the Friday 
 evening, when there had been no change of circumstances. They were 
 then stopped by the Court, who called upon 
 
 Jervis & Campbell in support of the rule. They relied on Payne v. 
 Cave [3 T. R. 148], and more particularly on Cooke v. Oxley [Id. 653]. 
 In that case Oxley, who had proposed to sell goods to Cooke, and given 
 him a certain time at his request, to determine whether he would 
 buy them or not, was held not liable to the performance of the con- 
 
28 OFFER AND ACCEPTANCE (Ch. 1 
 
 tract, even though Cooke, within- the specified time, had. determined 
 to buy them, and given Oxley notice to that effect. So here the de- 
 fendants who have proposed by letter to sell this wool, are not to be 
 held liable, even though it be now admitted that the answer did come 
 back in due course of post. Till the plaintiffs' answer was actually re- 
 ceived there could be no binding contract between the parties; and 
 before then the defendants had retracted their offer by selling the wool 
 to other persons. 
 
 But THE Court said that if that were so, no contract could ever be 
 completed by the post. For if the defendants were not bound by their 
 offer when accepted by the plaintiffs till the answer was received, then 
 the plaintiffs ought not to be bound till after they had received the no- 
 tification that the defendants had' received their answer and assented 
 to it. And so it might go on ad infinitum. The defendants must 
 be considered in law as making, during every instant of the time their 
 letter was traveling, the same identical offer to the plaintiffs, and 
 then the contract is completed I y the acceptance of it by the latter. 
 Then as to the delay in notifying the acceptance, that arises entirely 
 from the mistake of the defendants, and it therefore must be taken 
 as against them that the plaintiffs' answer was received in course of 
 post. 
 
 Rule discharged. 
 
 TAYLOE v. MERCHANTS' FIRE INS. CO. OF BALTIMORE. 
 (Supreme Court of the United States, 1850. 9 How. 390, 13 L. Ed. 187.) 
 
 Mr. Justice Nelson.^'' This is an appeal from a decree of the Cir- 
 cuit Court for the District of Maryland, which was rendered for the 
 defendants. 
 
 The case in the Court below was this : William H. Tayloe, of Rich- 
 mond County, Va., applied to John Minor, the agent of the defendants, 
 residing at Fredericksburg in that State, for an insurance upon his 
 dwelling-house to the amount of $8000 for one year, and, as he was 
 about leaving home for the State of Alabama, desired the agent to 
 make the applicatioji in his behalf. 
 
 The application was made accordingly, under the date of Novem- 
 ber 25th, 1844, and an answer received from the secretary of the 
 company, stating that the risk would be taken at 70 cents on the $100 
 the premium a,mounting to the sum of $56. The agent stated in the 
 application to the company the reason why it had not been signed 
 by Tayloe; that he had gone to the State of Alabama on business, 
 and would not return till February following, and that he was de- 
 sired to communicate to him at that place the answer of the company. 
 
 On receiving the answer, the agent mailed a letter directed to 
 
 <!s The statement of facts and part of the opinion have been omitted. 
 
Sec. 3) ACCEPTANCE BY POST 29 
 
 Tayloe, under date of December 2d, advising him of the terms of the 
 insurance, and adding, "Should you desire to effect the insurance, 
 send me your check payable to my order for $57, and the business is 
 concluded." The additional dollar was added for the policy. 
 
 This letter, in consequence of a misdirection, did not reach Tayloe 
 till the 20th of the month; who, on the next day, mailed a letter in 
 answer to the agent, expressing his assent to the terms, and inclos- 
 ing his check for the premium as requested. He also desired that 
 the policy should be depdsited in the bank for safe-keeping. This 
 letter of acceptance was received on the 31st at Fredericksburg by 
 the agent, who mailed a letter in answer the next day, communicating 
 to Tayloe his refusal to carry into effect the insurance, on the ground 
 that his acceptance came too late, the center building of the dwelling- 
 house in the mean time, on the 22d of the month, having been consumed 
 by fire. 
 
 The company, on being advised of the facts, confirmed the view 
 taken of the case by their agent, and refused to issue the policy or 
 pay the loss. 
 
 A bill was filed in the Court below by the insured against the tm- 
 pany, setting forth, substantially, the above facts, and praying that 
 the defendants might be decreed to pay the loss, or for such other 
 relief as the complainant might be entitled to. 
 
 I. Several objections have been taken to the right of the complain- 
 ant to recover, which it will be necessary to notice ; but the principal 
 one is that the contract of insurance was not complete at the time the 
 loss happened, and therefore that the risk proposed to be assumed had 
 never attached. 
 
 Two positions have been taken by the counsel for the company for the 
 purpose of establishing this ground of defence. 
 
 1. The want of notice to the agent of the company of the accept- 
 ance of the terms of the insurance ; and, 
 
 2. The nonpayment of the premium. 
 
 The first position assumes that, where the company have made an 
 offer through the mail to insure upon certain terms, the agreement 
 is not consummated by the mere acceptance of the offer by the party 
 to whom it is addressed; that the contract is still open and incom- 
 plete until the notice of acceptance is received; and that the com- 
 pany are at liberty to withdraw the offer at any time before the arrival 
 of the notice, and this even without communicating notice of the 
 withdrawal to the applicant; in other words, that the assent of the 
 company, express or implied, after the acceptance of the terms pro- 
 posed by the insured, is essential to a consummation of the contract. 
 
 The effect of this construction is to' leave the property of the in- 
 sured uncovered until his acceptance of the offer has reached the 
 company and has received their assent, for if the contract is incom- 
 plete until notice of the acceptance, till then the company may retract 
 
30 OFFER AND ACCEPTANCE (Ch. 1 
 
 the offer, as neither party is bound until the negotiation has resuhed 
 in a complete bargain between the parties. 
 
 In our apprehension, this view of the transaction is not in ac- 
 cordance with the usages and practice of these companies in taking 
 risks; nor with the understanding of merchants and other business 
 men dealing with them; nor with the principles of law, settled in 
 analogous cases, governing contracts entered into by correspondence 
 between parties residing at a distance. 
 
 On the contrary,, we are of opinion, that an offer under the cir- 
 cumstances stated, prescribing the terms of insurance, is intended, and 
 is to be deemed, a valid undertaking on the part of the company, 
 that they will be bound, according to the terms tendered, if an answer 
 is transmitted in due course of mail, accepting them; and that it can- 
 not be withdrawn, unless the withdrawal reaches the party to whom 
 it is addressed before his letter of reply announcing the acceptance has 
 been transmitted. 
 
 This view of the effect of the correspondence seems to us to be but 
 carrying out the intent of the parties, as plainly manifested by their 
 acts and declarations. 
 
 On the acceptance of the terms proposed, transmitted by due 
 course of mail to the company, the minds of both parties have met 
 on the subject, in the mode contemplated at the time of entering 
 upon the negotiation, and the contract becomes complete. The party 
 to whom the proposal is- addressed has a right to regard it as intended 
 as a continuing offer until it shall have reached him, and shall be in 
 due time accepted or rejected. 
 
 Such is the plain import of the offer. And besides, upon any other 
 view the proposal amounts to nothing, as the acceptance would be 
 but the adoption of the terms tendered, to be, in turn, proposed by 
 the applicant to the company for their approval or rejection. For, 
 if the contract is still open until the company is advised of an accept- 
 ance, 'it follows, of course, that the acceptance may be repudiated at 
 any time before the notice is received. Nothing is effectually ac- 
 complished by an act of acceptance. 
 
 It is apparent, therefore, that such an interpretation of tlie acts of 
 the parties would defeat the object which both had in view in enter- 
 ing upon the correspondence. 
 
 The fallacy of the argument, in our judgment, consists in the as- 
 sumption, that the contract cannot be consummated without a knowl- 
 edge on the part of the company that the offer has been accepted. 
 This is the point of the objection. But a little reflection will show 
 that, in all cases of contracts entered into between parties at a dis- 
 tance by correspondence, it is impossible that both should have a 
 knowledge of it the moment it becomes complete. This can only exist 
 where both parties are present. 
 
 The position may be illustrated by the case before us. If the con- 
 tract became complete, as we think it did, on the acceptance of the 
 
Set. 3) ACCEPTANCE BY POST 31 
 
 offer by the applicant, on December 21st, 1844, the company, of 
 course, could have no knowledge of iti until the letter of acceptance 
 reached the agent, on the 31st of the month; and, on the other hand, 
 upon the hypothesis it was not complete until notice of the accept- 
 ance, and then became so, the applicant could have no knowledge of 
 it at the time it took efifect. In either aspect, and, indeed, in any as- 
 pect in which the case can be presented, one of the parties must be 
 unadvised of the time when the contract takes effect, as its consum- 
 mation must depend upon the act of one of them in the absence of 
 the other. 
 
 The negotiation being carried on through the mail, the offer and 
 acceptance cannot occur at the same moment of time; nor, for the 
 same reason, can the meeting of the minds of the parties on the sub- 
 ject be known by each at the moment of concurrence; the acceptance 
 miist succeed the offer after the lapse of some interval of time; and, 
 if the process is to be carried farther in order to complete the bar- 
 gain, and notice of the acceptance must be received, the only effect 
 is to reverse the position of the parties, changing the knowledge of the 
 completion from the one party to the other. 
 
 It is obviously impossible, therefore, under the circumstances 
 stated, ever to perfect a contract by correspondence, if a knowledge 
 of both parties at the moment they become bound is an essential 
 element in making out the obligation. And as it must take effect, 
 if effect is given at all to an endeavor to enter into a contract by cor- 
 respondence, in the absence of the knowledge of one of the parties 
 at the time of its consummation, it seems to us more consistent with 
 the acts and declarations of the parties, to consider it complete on 
 the transmission of the acceptance of the offer in the way they 
 themselves contemplated; instead of postponing its completion till 
 notice of such acceptance has been received and assented to by the 
 company. * * * 
 
 Reversed and remanded. 
 
 V 
 HOUSEHOLD FIRE & CARRIAGE ACC. INS. CO., Umited, 'v. 
 
 GRANT. 
 
 (In the Court of Appeal, 1879. 4 Exch. Div. 216.) 
 
 Action to recover £94. 15s., being the balance due upon 100 shares 
 allotted to the defendant on the 25th of October, 1874, in pursuance of 
 an application from the defendant for such shares, dated the 30th of 
 September 1874. 
 
 At the trial before Lopes J., during the Middlesex sittings, 1878, the 
 following facts were proved: In 1874 one Kendrick was acting in 
 Glamorganshire as the agent of the company for the placing of their 
 shares, and on the 30th of September the defendant handed to Ken- 
 drick an application in writing for shares in the plaintiff's company, 
 
32 OFFEE AND ACCEPTANCE (Ch. 1 
 
 which stated that the defendant had paid to the bankers of the com- 
 pany £5, being a deposit of Is. per share, and requesting an allotment 
 of 100 shares, and agreeing to pay the further sum of 79s, per share 
 within twelve months of the date of the allotment. Kendrick duly for- 
 warded this application to the plaintiffs in London, and the secretary 
 of the company, on the 20th of October, 1874, made out the letter of 
 allotment in favour of the defendant, which was posted addressed to 
 the defendant at his residence, 16 Herbert street, Swansea, Glamorgan- 
 shire. His name was then entered on the register of shareholders. 
 This letter of allotment never reached the defendant. The defendant 
 never paid the £ 5 mentioned in his application but, the plaintiffs' com- 
 pany being indebted to the defendant in the sum of £5 for com- 
 mission, that sum was duly credited to his account in their books. In 
 July, 1875, a dividend at the rate of 2% per cent, was declared on the 
 shares, and in February, 1876, a further dividend at the same r^te. 
 These dividends, amounting altogether to the sum of 5s. were also 
 credited to the defendant's account in the books of the plaintiffs' com- 
 pany. Afterwards the company went into liquidation, and on the 7th 
 of December, 1877, the official liquidator applied for the sum sued for 
 from the defendant ; the defendant declined to pay, on the ground that 
 he was not a shareholder. 
 
 On these facts the learned judge left two questions to the jury: (1) 
 Was the letter of allotment of the 20th of October in fact posted? 
 (2) Was the letter of allotment received by the defendant? The jury 
 found the first question in the affirmative and the last in the negative. 
 The learned judge reserved the case for further consideration, and 
 after argument directed judgment to be entered for the plaintiffs on 
 the authority of Dunlop v. Higgins, 1 H. L,. CasI* 381. 
 
 The defendant appealed. 
 
 ThBsiger, L. J.^^ In this case the defendant made an application for 
 shares in the plaintiffs' company, under circumstances from which we 
 must imply that he authorized the company, in the event of their al- 
 lotting to him the shares applied for, to send the notice of allotment by 
 post. The company did allot him the shares, and duly addressed to 
 hrm and posted a letter containing the notice of allotment, but upon the 
 finding of the jury it must be taken that the letter never reached its 
 destination. In this state of circumstances. Lopes, J., has decided that 
 the defendant is liable as a shareholder. He based his decision mainly 
 upon the ground that the point for consideration was covered by au- 
 thority binding upon him, and I am of opinion that he did so rightly, 
 and that it is covered by authority equally binding upon this court. 
 
 The 'leading case upon the subject is Dunlop v. Higgins, 1 H. L. Cas. 
 381.°* It is true that Lord Cottenham might have decided that case 
 
 23 Opinion of Baggallay, L. .T., omitted. 
 
 2* In Dunlop v. Higgins, 1 H. L. Cas. 381 (1848), Dunlop wrote from Glas- 
 gow offering to sell 2,000 tons of pig iron. Higgins mailed an acceptance at 
 Liverpool on January 30, saying: "We have accepted your ofCer un condition- 
 
Sec. 3) ACCEPTANCE BY POST 33 
 
 without deciding the point raised in this. But it appears to me equally- 
 true that he did not do so, and that he preferred to rest and did rest 
 his judgment as to one of the matters of exception before him upon a 
 principle which embraces and governs the present case. If so, the 
 court is as much bound to apply that principle constituting as it did a 
 ratio decidendi, as it is to follow the exact decision itself. The excep- 
 tion was that the I<ord Justice General directed the jury in point of law 
 that, if the pursuers posted their acceptance of the offer in due time, 
 according to the usage of trade they were not responsible for any cas- 
 ualties in the post-office establishment. This direction was wide 
 enough in its terms to include the case of the acceptance never being . 
 delivered at all; and Lord Cottenham, in expressing his opinion that 
 it was not open to objection, did so after putting the case of a letter 
 containing a notice of disTionour posted by the holder of a bill of ex- 
 change in proper time, in which case he said (1 H. L. Cas., at page 
 399) : "Whether that letter be delivered or not is a matter quite im- 
 material, because for accidents happening at the post-office he is not 
 responsible." In short, Lord Cottenham appears to me to have held 
 that, as a rule, a contract formed by correspondence through the post 
 is complete .as soon as the letter accepting an offer is put into the post, 
 and is not put an end to in the event of the letter never being delivered. 
 My view of the effect of Dunlop v. Higgins, 1 H. L. Cas. 381, is that 
 taken by James,, L. J., in Harris' Case, L. R. 7 Ch. 587. There^ at page 
 592, he speaks of the former case as "a case which is binding upon us, 
 and in which every principle argued before us was discussed at length 
 by the Lord Chancellor in giving judgment." He adds, the Lord Chan- 
 cellor "arrived at the conclusion that the posting of the letter of ac- 
 ceptance is the completion of the contract ; that is to say, the moment 
 one man has made an offer, and the other has done something binding 
 himself to that offer, then the contract is complete, and neither party 
 can afterwards escape from it." Mellish, J., also took the same view. 
 He says, at page 595: "In Dunlop v. Higgins, 1 H. L. Cas. 381, the 
 question was directly raised whether the law was truly expounded in 
 the case of Adams v. Lindsell, 1 Barn. & Aid. 681. The house of lords 
 approved of the ruling of that case. The Lord Chancellor Cottenham 
 said, in the course of his judgment, that in the case of a bill of ex- 
 change notice of dishonour, given by putting a letter inte the post at 
 the right time, had been held quite sufficient whether that letter was 
 delivered or not ; and he referred to Stocken v. Collin, 7 Mees. & W. 
 515, on that point, he being clearly of opinion that the rule as to ac- 
 cepting a contract was exactly the same as the rule as to sending no- 
 tice of dishonour of a bill of exchange. He then referred to the case 
 
 ally ; but we hope you will accede to our request as to delivery and mode of 
 payment by two months' bill." This letter was misdated "January 31," and 
 because of delay in the mails it was not received In Glasgow until February 1. 
 An acceptance on January 31 would in fact have been too late. It was held 
 that a contract was made. 
 
 COBBIN CONT 3 
 
34 OFFER AND XCCEPTANCB (Ch. 1 
 
 of Adams v. Lindsell, 1 Barn. & Aid. 681, and quoted the observation 
 of Lord Ellenborough, C. J. That case therefore appears to me to be 
 a direct decision that the contract is made from the time when it is ac- 
 cepted by post." Leaving Harris' Case, L.' R. 7 Ch. 587, for the mo- 
 ment, I turn to Duncan v. Topham, 8 C. B. 225, in which Cresswell, J., 
 told the jury that if the letter accepting the contract was put into the 
 post-office and lost by the negligence of the post-office authorities, the 
 contract would nevertheless be complete ; and both he and Wildcj C. 
 J., and Maule, J., seem to have understood this ruling to have been in 
 accordance with Lord Cottenham's opinion in Dunlop v. Higgins, 1 H. 
 L. Cas. 38L That opinion therefore appears to me to constitute an 
 authority directly binding upon us. But if Dunlop v. Higgins were 
 out of the way, Harris' Case, L- R. 7 Ch. 587, would ,still go far to 
 govern the present. There it was held that the acceptance of the offer 
 at all events binds both parties from the time of the acceptance being 
 posted, and so as to prevent any retraction of the offer being of effect 
 after the acceptance has been posted. Now, whatever in abstract dis- 
 cussion may be said as to the legal notion of its being necessary, in or- 
 der to the effecting of a valid and binding contract, that the minds of 
 the parties should be brought together at one and the same moment, 
 that notion is practically the foundation of English law upon the sub- 
 ject of the formation of contracts. Unless therefore a contract con- 
 stituted by correspondence is absolutely concluded at the moment that 
 the continuing offer is accepted by the person to whom the offer is 
 addressed, it is difficult to see how the two minds are ever to be 
 brought together at one and the same moment. This was pointed out 
 by Lord Ellenborough in the case of Adams v. Lindsell, 1 B. & Aid. 
 681, which is recognized authority upon this branch of the law. But, 
 on the other hand, it is a principle of law, as well established as the 
 legal notion to which I have referred, that the minds of the two par- 
 ties must be brought together by mutual communication. An accept- 
 ance, which only remains in the breast of the acceptor without being 
 actually and by legal implication communicated to the offerer, is no 
 binding acceptance. How, then, are these elements of law to be har- 
 monized in the case pi contracts formed by correspondence through 
 the post? I see no better mode than that of treating the post-office as 
 the agent of both parties, and it was so considered by Lord Romilly in 
 Hebb's Case, L. R. 4 Eq. at page 12, when in the course of his judg- 
 ment he said: "Dunlop v. Higgins, 1 H. L. C. 381, decides that the 
 posting of a letter accepting an offer constitutes a binding contract, 
 but the reason of that is, that the post-office is the common agent of 
 both parties." Alderson, B., also in Stocken v. Collin, 7 M. & W. at 
 page 516, a case of notice of dishonor, and the case referred to by 
 Lord Cottenham, says: "If the doctrine that the post-office is only 
 the agent for the delivery of the notice were correct, no one could safe- 
 ly avail himself of that mode of transmission." But if the post-office 
 be such common agent, then it seems to me to follow that, as soon 
 
Sec. 3) ACCEPTANCE BY POST 35 
 
 as the letter of acceptance is delivered to the post-office, the contract 
 is made as complete and final and absolutely binding as if the acceptor 
 had put his letter into. the hands of a messenger sent by the offerer 
 himself as his agent to deliver the offer and receive the acceptance. 
 What other principle can be adopted short of holding that the contract 
 is not complete by acceptance until and except from the time that the 
 letter containing the acceptance is delivered to the offerer, a principle 
 which has been distinctly negatived? This difficulty was attempted to 
 be got over in the British and American Telegraph Co. v. Colson, L. 
 R. 6 Ex. ' 108, which was a case directly on all fours with the present 
 and in which Kelly, C. B. (Id., at page 115), is reported to have said: 
 "It may be that in general, though not in all cases, a contract takes 
 effect from the time of acceptance, and not from the subsequent noti- 
 fication of it. As in the case now before the court, if the letter of al- 
 lotment had been delivered to the defendant in the due course of the 
 post, he would have become a shareholder from the date of the letter. 
 And to this effect is Potter v. Sanders, 6 Hare, 1. And hence perhaps 
 the mistake has arisen that the contract is binding upon both parties 
 from the time when the letter is written and put into the post, although 
 never delivered; whereas, although it may be binding from the time 
 of acceptance, it is only binding at all when afterwards duly notified." 
 But with deference I would ask how a man can be said to be a share- 
 holder at a time before he was bound to take any shares, or, to put the 
 question in the form in which it is put by Mellish, L. J., in Harris' 
 Case, 7 Ch. App. 587, at page 596, how there can be any relation back 
 in a case of this kind as there may be in bankruptcy. If, as the lord 
 justice said, the contract, after the letter has arrived in time, is to be 
 treated as having been made from the time the letter is posted, the rea- 
 son is that the contract was actually made at the time when the letter 
 was posted. The principle indeed laid down in Harris' Case, as well 
 as in Dunlop v. Higgins, 1 H. L. Cas. 381, can really not be reconciled 
 with the decision in Telegraph Co. v. Colson, L. R. 6 Exeh. 108. James,' 
 L. J., in the passage I have already quoted, — Harris' Case, L,. R. 7 Ch., 
 592, — affirms the proposition that when once the acceptance is posted 
 neither party can afterwards escape from the contract, and refers with 
 approval to Hebb's Case, L. R. 4 Eq. 9. There a distinction was tak- 
 en by the master of the rolls that the company chose to send the letter 
 of allotment to their own agent, who was not authorized by the appli- 
 cant for shares to receive it on his behalf, and who never delivered it ; 
 but he at the same time assumed that if, instead of sending it through 
 an authorized agent, they had sent it through the post-office, the ap- 
 plicant would have been bound although the letter had never been de- 
 livered. Mellish, L. J., really goes as far, and states forcibly the rea- 
 sons in favour of this view. The mere suggestion thrown out at the 
 close of his judgment, at page 597, when stopping short of actually 
 overruliiig the decision in Telegraph Co. v. Colson, that although a 
 contract is complete when the letter accepting an offer is posted, 
 
36 OFFEE AND ACCEPTANCE (Ch. 1 
 
 yet it may be subject to a condition subsequent that, if the letter 
 does not arrive in due course of post, then the parties may act 
 on the assumption that the offer has not been accepted, can hardly, 
 when contrasted with the rest of the jiidgment, be said to repre- 
 sent his own opinion on the law upon the subject. The contract, as 
 he says (L. R. 7 Ch. at page 596), is actually made when the letter is 
 posted. The acceptor, in posting the letter, has, to use the language of 
 I,ord Blackburn, in Brogden v. Directors of Metropolitan Ry. Co., 2 
 App. Cas. 666, 691, "put it out of his control and done an extraneous 
 act which clinches the matter, and shows beyond all doubt that each 
 side is bound." How, then, can a casualty in the post, whether result- 
 ing in delay, which in commercial transactions is often as bad as no de- 
 livery, or in non-delivery, unbind the parties or unmake the contract? 
 To me it appears that in practice a contract complete upon the accept- 
 ance of an offer being posted, but liable to put an end to by an accident 
 in the post, would be more mischievous than a contract only binding 
 upon the parties to it upon the acceptance actually reaching the offer- 
 er, and I can see no principle of law from which such an anomalous 
 contract can be deduced. 
 
 There is no doubt that the implication of a complete, final, and ab- 
 solutely binding contract being formed, as soon as the acceptance of an 
 offer is posted, may in some cases lead to inconvenience and hardship. 
 But such there must be at times in every view of the law. It is im- 
 possible in transactions which pass between parties at a distance, and 
 have to be carried on through the medium of correspondence, to adjust 
 conflicting rights between innocent parties, so as to make the conse- 
 quences of mistake on the part of a mutual agent fall equally upon the 
 shoulders of both. At the same time I am not prepared to admit that 
 the implication in question will lead to any great or general inconven- 
 ience or hardship. An offerer, if he chooses, may always make the 
 formation of the contract which he proposes dependent upon the actual 
 communication to himself of the acceptance. If he trusts to the post 
 he trusts to a means of communication which, as a rule, does not fail, 
 and if no answer to his offer is received by him, and the matter is of 
 importance to him, he can make inquiries of the person to whom his 
 offer was addressed. On the other hand, if the contract is not finally 
 concluded, except in the event of the acceptance actually reaching the 
 offerer, the door would be opened to the perpetration of much fraud, 
 and, putting aside this consideration, considerable delay in commercial 
 transactions, in which despatch is, as a rule, of the greatest conse- 
 quence, would be occasioned ; for the acceptor would never be entire- 
 ly safe in acting upon his acceptance until he had received notice that 
 his letter of acceptance had reached its destination. 
 
 Upon balance of conveniences and inconveniences it seems to me, 
 applying with slight alterations the language of tlie Supreme Court 
 of the United States in Tayloe v. Merchants' Fire Insurance Co., 9 
 How. 390, more consistent with the acts and declarations of the par- 
 
Sec. 3) ACCEPTANCE; BY POST 37 
 
 ties in this case to consider the contract coniplete and absolutely 
 binding on the transmission of the notice of allotment through the post, 
 as the medium of communication that the parties themselves contem- 
 plated, instead of postponing its completion until the notice had 
 been received by the defendant. Upon principle, therefore, as well 
 as authority, I think that the judgment of Lopes, J., was right 
 and should be affirmed, and that this appeal should therefore be dis- 
 missed. 
 
 BramwELL, L. J. The question in this case is not whether the post- 
 office was a proper medium of communication from the plaintiffs to 
 the defendant. There is no doubt that it is so in all cases where 
 personal service is not required. It is an ordinary mode of commu- 
 nication, and every person who gives any one the right to commu- 
 nicate with him gives the right to communicate in an ordinary man- 
 ner, and so in this way and to this extent, that if an offer were 
 made by letter in the morning to a person at a place within half an 
 hour's railway journey of the offerer, I should say that an accept- 
 ance by post, though it did not reach the offerer till the next morn- 
 ing, would be in time. Nor is the question whether, when the letter 
 reaches an offerer, the latter is bound and the bargain made from the 
 time the letter is posted or despatched, whether by post or otherwise. 
 The question in this case is different. I will presently state what in 
 my judgment it is. Meanwhile I wish to mention some elementary 
 propositions which, if carefully borne in mind, will assist in the de- 
 termination of this case : 
 
 First. Where a proposition to enter into a contract is made and 
 accepted, it is necessary, as a rule, to constitute the contract that there 
 should be a communication of that acceptance to the proposer, per 
 Brian, C. J. (Y. B. 17 Edw. IV, 2, post, p. 60), and Lord Blackburn : 
 Brogden v. Metropolitan Ry. Co., 2 App. Cas. at page 692. 
 
 Secondly. That the present case is one of proposal and accept- 
 ance. 
 
 Thirdly. That as a consequence of or involved in the first proposi- 
 tion, if the acceptance is written or verbal — i. e., is by letter or mes- 
 sage, as a rule, it must reach the proposer or there is no communica- 
 tion, and so no acceptance of the offer. 
 
 Fourthly. That if there is a difference where the acceptance is by 
 a letter sent through the post which does not reach the offerer, it 
 must be by virtue of some general rule or some particular agreement 
 of the parties. As, for instance, there might be an agreement that 
 the acceptance of the proposal may be by sending the article offered 
 by the proposer to be bought, or hanging out a flag or sign to be seen 
 by the offerer as he goes by, or leaving a letter at a certain place, or 
 any other agreed mode, and in the same way there might be an agree- 
 ment that dropping a letter in a post pillar-box or other place of 
 reception should suffice. 
 
38 OFFER AND ACCEPTANCE (Ch. 1 
 
 Fifthly. That as there is no such special agreement in this case, 
 the defendant, if bound, must be bound by some general rule which^ 
 makes a difference when the post-office is employed as the means of 
 communication. 
 
 Sixthly. That if there is any such general rule applicable to the 
 communication of the acceptance of offers, it is equally applicable 
 to all communications that may be made by post. Because, as I 
 have said, the question is not whether this communication may be 
 made by post. If, therefore, posting a letter which does not reach 
 is a sufficient communication of acceptance of an offer, it is equally 
 a communication of everything else which may be communicated 
 by post — ^e. g., notice to quit. It is impossible to hold, if I offer my 
 landlord to sell him some hay, and he writes accepting my offer, and 
 in the same letter gives me notice to quit, and posts his letter, "which, 
 however, does not reach me, that he had communicated to me his 
 acceptance of my offer, but not his notice to quit. Suppose a man 
 has paid his tailor by check or bank-note, and posts a letter contain- 
 ing a check or bank-note to his tailor, which never reaches, is the 
 tailor paid? If he is, would he be if he had never been paid before 
 in that way? Suppose a man is in the habit of sending checks and 
 bank-notes to his banker by post, and posts a letter containing checks 
 and bank-notes, which never reaches. Is the banker liable? Would 
 he be if this was the first instance of a remittance of the sort? In 
 the cases I have supposed, the tailor and banker may have recog- 
 nized this mode of remittance by sending back receipts and putting 
 the money to the credit of the remitter. Are they liable with that? 
 Are they liable without it? The question then is. Is posting a letter 
 which is never received a communication to the person addressed, or 
 an equivalent, or something which dispenses with it? It is for those 
 who say it is to make good their contention. I ask why is it? My 
 answer beforehand to any argument that may be urged is, that it is 
 not a communication, and that there is no agreement to take it as an 
 equivalent for or to dispense with a communication. That those 
 who affirm the contrary say the thing which is not. That if Brian, 
 C. J., had had to adjudicate on the case, he would deliver the same 
 judgment as that reported. That because a man, who may send a 
 communication by post or otherwise, sends it by post, he should bind 
 the person addressed, though the communication never reaches him, 
 while he would not so bind him if he had sent it by hand, is impos- 
 sible. There is no reason in it; it is simply arbitrary. I ask wheth- 
 er any one who thinks so is prepared to follow that opinion to its con- 
 sequence; suppose the offer is to sell a particular chattel, and the 
 letter accepting it never arrives, is the property in the chattel trans- 
 ferred? Suppose it is to sell an estate or grant a lease, is the bargain 
 completed? The lease might be such as not to require a deed, could 
 a subsequent lessee be ejected by the would-be acceptor of the offer 
 
Sec. 3) ACCEPTANCE BY POST 39 
 
 because he had posted a letter. Suppose an article is advertised at 
 so much, and that it would be sent on receipt of a post-office order. Is 
 it enough to post the letter? If the word "receipt" is relied on, is it 
 really meant that that makes a difference? If it should be said let 
 the offerer wait, the answer is, may be he may lose his market mean- 
 while. Besides, his offer may be by advertisement to all mankind. 
 Suppose a reward for information, information posted does not reach, 
 some one else gives it and is paid, is the offerer liable to the first 
 mah? 
 
 It is said that a contrary rule would be hard on the would-be ac- 
 ceptor, who may have made his arrangements on the footing that the 
 bargain was concluded. But to hold as contended would be equally 
 hard on the offerer, who may have made his arrangements on the 
 footing that his offer was not accepted; his non-receipt of any com- 
 mvmication may be attributable to the person to whom it was made 
 being absent. What is he to do but to act on the negative, that no 
 communication has been made to him? Further, the use of the post- 
 ofifice is no more authorized by the offerer than the sending an an- 
 swer by hand, and all these hardships would befall the person posting 
 the letter if he sent it by hand. Doubtless in that case he would 
 be the person to suffer if the letter did not reach its destination. 
 Why should his sending it by post relieve him of the loss and cast it 
 on the other party. It was said, if he sends it by hand it is revocable, 
 but not if he sends it by post, which makes the difference. But it is 
 revocable when sent by post, not that the letter can be got back, but 
 its arrival rnight be anticipated by a letter by hand or telegram, and 
 there is no case to show tliat such anticipation would not prevent the 
 letter from binding.^ ^ It would be a most alarming thing to say that 
 it would. That a letter honestly but mistakenly written and posted 
 must bind the writer if hour-s before its arrival he informed the person 
 addressed that it was coming, but -was wrong and recalled; suppose a 
 false but honest character given, and the mistake found out after the 
 letter posted, and notice that it was wrong given to the person ad- 
 dressed. 
 
 Then, as was asked, is the principle to be applied to telegrams? 
 Further, it seems admitted that if the proposer said, "Unless I hear, 
 from you by return of post the offer is withdrawn," that the letter 
 accepting it must reach him to bind him. There is, indeed, a case 
 recently reported in the Times, before the Master of the Rolls, where 
 the offer was to be accepted within fourteen days, and it is said to have 
 been held that it was enough to post the letter on the 14th, though it 
 would and did not reach the offerer till the 15th. Of course there 
 
 2 5 By the American post office regulations a posted letter can be recalled by 
 the sfinSer. By the French law a telegram anticipating the letter of accept- 
 ance would render the latter inoperative. See note to Hallock v. Commercial 
 Ins, Co., post, p. 72. 
 
40 OFFER AND ACCEPTANCE (Ch. 1 
 
 may have been something in that case' not mentioned in the report. 
 But as it stands it comes to this, that if an offer is to be accepted in 
 June, and there is a month's post between the places, posting the letter 
 on June 30th will suffice, though it does not reach till July 31st; 
 but that case does not affect this. There the letter reached, here it 
 has not. If it is not admitted that "unless I hear by return the offer 
 is withdrawn" makes the receipt of the letter a condition, it is to 
 say an express condition goes for naught. If it is admitted, is it not 
 what every letter says ? Are there to be fine distinctions, such' as, 
 if the words are "unless I hear from you by return of post," etc., it 
 is necessary the letter should reach him, but "let me know by return 
 of post," it is not;' or if in that case it is, yet it is not where there 
 is an offer without those words. Lord Blackburn says that Mellish, 
 L,. J., accurately stated that where it is expressly or impliedly stated 
 in the, offer, "you may accept the offer by posting a letter," the 
 moment you post this letter the offer is accepted. I agree; and the 
 same thing is true of any other mode of acceptance offered with the 
 offer and acted on — as firing a cannon, sending off a rocket, give 
 your answer to my servant the bearer. Lord Blackburn was not deal- 
 ing with the question before us ; there was no doubt in the case be- 
 fore him that the letter had reached. As to the authorities, I shall not 
 re-examine those in existence, before the British and American Tele- 
 graph Co. V. Colson, L. R. 6 Ex. 108. But I wish to say a word 
 as to Dunlop v. Higgins, 1 H. L- C. 381 ; the Whole difficulty has 
 arisen from some expressions in that case. Mr. Finlay's argument 
 and reference to the case when originally in the Scotch Court has 
 satisfied me that Dunlop v. Higgins, 1 H. L. C. 381, decided nothing 
 contrary, to the defendant in this case. Mellish, L. J., in Harris's Case, 
 L. R. 7 Ch. 596, says: "That case is not a direct decision on the 
 point before us." It is true, he adds, that he has great difficulty in 
 reconciling the case of the British and American Telegraph Co. v. 
 Colson, L. R. 6 Ex. 108, with Dunlop v. Higgins. I do not share that 
 difficulty. I think they are perfectly reconcilable, and that I have 
 shown so. Where a posted letter arrives, the contract is complete on 
 the posting. So where a letter sent by hand arrives, the contract is 
 complete on the writing and delivery to the messenger. Why not? 
 All the extraordinary and mischievous consequences which the Lord 
 Justice points out in Harris's Case might happen if the law were other- 
 wise when a letter is posted, would equally happen where it is sent 
 otherwise than by the post. He adds that the question before the 
 Lords in Dunlop v. Higgins was whether the ruling of the Lord Jus- 
 tice Clerk was correct, and they held it was. Now Mr. Finlay showed 
 very clearly that the Lord Justice Clerk decided nothing inconsist- 
 ent with the judgment in the British and American Telegraph Qo. v. 
 Colson. Since the last case there have been two before Vice-Chan- 
 cellor Malins, in the earlier of which he thought it "reasonable," and 
 
Sec. 3) ACCEPTANCE BT POST 41 
 
 followed It. In the other, because the Lord Justices had in Harris's . 
 Case thrown cold water on it, he appears to have thought it not rea- * 
 sonable. He says, suppose the sender of a letter says, "I make you 
 an offer, let me have an answer by return of post." By return the 
 letter is posted, and A. has done all that the person making the offer 
 requests. Now that Is precisely what he has not done. He has not 
 let him "have an answer." He adds there is no default on his part. 
 Why should he be the only person to suffer ? Very true. But there is 
 no default in the other, and why should he be the only person to suffer ? 
 The only otlier authority is the expression of opinion by Lopes, J., in 
 the present case. He says the proposer may guard himself against 
 hardship by making the proposal expressly conditioned on the arrival 
 of the answer within a definite time. But it need not be express nor 
 within a definite time. It is enough that is to be inferred that it is to 
 be, and if it is to be it must be within a reasonable time. The mis- 
 chievous consequences he points out do not follow from that which 
 I am contending for. I am at a loss to see how the post-office is the 
 agent for both parties. What is the agency as to the sender? merely 
 to receive? But suppose it is not an answer, biit an original com- 
 munication. What then? Does the extent of the agency of the post- 
 ofKce depend on the contents of the letter? But if the post-office is 
 the agent of botli parties, then the agent of both parties has failed in 
 his duty, and to both. Suppose the offerer says, "My offer is condi- 
 tional on your answer reaching me." Whose agent is the post-office 
 then ? But how does an offerer make the post-office his agent, because 
 he gives the offeree an option of using that or any other means of com- 
 munication ? 
 
 I am of opinion that this judgment should be reversed. 'I am of 
 opinion that there was no bargain between these parties to allot and 
 take shares, that to make such bargain there should have been an 
 acceptance of the defendant's offer and a communication to him of 
 that acceptance. That there was no such communication. That post- 
 ing a letter does not differ from other attempts at communication in 
 any of its consequences, save that it is irrevocable as between the 
 poster and post-office. The difficulty has arisen from a mistake as 
 to what was decided in Dunlop v. Higgins, and from supposing that 
 because there is a right to have recourse to the post as a means of 
 communication, that right is attended with some peculiar conse- 
 quences, and also from supposing that because if the lettef reaches it 
 binds from the time of posting, it also binds though it never reaches. 
 Mischief may arise if my opinion prevails. It probably will not, as so 
 much has been said on the matter that principle is lost sight of. I 
 believe equal if not greater, will, if it does not prevail. I believe the 
 latter will be obviated only by the rule being made nugatory by ev- 
 ery prudent man saying, "Your answer by post is only to bind if it 
 reaches me." But the question is not to be decided on these con- 
 siderations. What is the law? What is the principle? If Brian, C. 
 
42 OFFER AND ACCEPTANCE (Ch. 1 
 
 • J., had had to decide this, a public post being instituted in his time, 
 he would have said the law is the same, now there is a post, as it 
 was before — viz., a communication to affect a man must be a com- 
 munication — i, e., must reach him. 
 Judgment affirmed.-" 
 
 LEWIS V. BROWNING. 
 (Supreme Judicial Court of Massachusetts, 1881. 130 Mass. 173.) 
 
 Actipn for breach of covenants in a lease. The question was wheth- 
 er the terms of a proposed new lease had been accepted by defendant. 
 The negotiations with reference to the new lease were carried on by 
 letter a;nd telegraph. The facts sufficiently appear in the opinion of the 
 court. 
 
 Gray, C. J. In M'Culloch v. Insurance Co., 1 Pick. 278, this court 
 held that a contract made by mutual letters was not complete until the 
 
 2 6 The American cases are now uniformly agreed that, if the acceptor is 
 expressly or impliedly invited to use the post, the acceptance is complete when 
 the letter of acceptance is mailed. Mactier v. If^ith, 6 Wend. (N. Y.) 103, 21 
 Am. Dec. 262 (1830) ; McClintock v. South Penn Oil Co., 146 Pa. 144. 23 Atl. 
 211, 28 Am. St. Eep. 785 (1892) ; Northampton Mut. Live Stock Ins. Go. v. 
 Tuttle, 40 N. J. Law, 476 (1878) ; Stephen M. Weld & Co. v. Victory Mfg. Co. 
 (D. O.) 205 Fed. 770 (1913) ; Wester v. Casein Co. of America, 206 N. Y. 506, 
 100 N. E. 488, Ann. Cas. 1914B. 377 (1912) ; Vassar v. Gamp, 11 N. Y. 441 
 (1854); Williams v. Burdick, 63 Or. 41, 125 Pac. 844, 126 Pac. 603 (1912); 
 Watson V. Paschall, 93 S. C. 537, 77 S. E. 291 (1913); Kenedy Mercantile Co. 
 V. Western Union Tel. Co. (Tex. Civ. App.) 167 S. W. 1094 (1914) ; Ferrier v. 
 Storer, 63 Iowa, 484, 19 N. W. 288, 50 Am. Rep. 752 (1884) ; Howard v. Daly, 
 61 N. Y. 362, 19 Am. Eep. 285 (1875), acceptance valid when put in ofterer's 
 private letter box. 
 
 To be so operative, the acceptance must be properly stamped and addressed. 
 Potts V. Whitehead, 20 N. J. Eq. 55 (1869). , 
 
 The fact that under the postal regulations a letter may be reclaimed by the ' 
 sender does not operate to change this rule. McDonald v. Chemical Nat 
 Bank, 174 V. S. 610, 19 Sup. Ct. 787, 43 L. Ed. 1106 (1899). 
 
 The contract is regarded as made in the state where the letter of acceptance 
 is mailed. Emerson Co. v. Proctor, 97 Me. 360, 54 Atl. 849 (1903) ; Bank of 
 Yolo v. Sperry Flour Co., 141 Gal. 314, 74 Pac. 855, 65 L. R. A. 90 (1903), ac- 
 ceptance by telephone ; Cowan v. O'Connor, 20 Q. B. D. 640 (1888). See also 
 Newcomb v. De Eoos, 2 El. & El. 271 (1859) ; Taylor v. Jones, L. R 1 C p' 
 87 (1875). 
 
 A letter is not mailed by giving it to a postman who is not an official col- 
 lector of mail. In re London & Northern Bank, [1900] 1 Ch. 220. 
 
 The French courts appear to hold as did the Massachusetts court In Mc- 
 CuUoch V. Eagle Ins. Co., 1 Pick: 278 (1822), that there is no contract until 
 the offerer learns of the acceptance. S— — v. F — , Merlin, Rgp. de Jur. (1913) 
 tit. Vente, 1, art. Ill, No. XI bis, printed jn Langdell's Cases on Contracts' 
 In re Laura et Cie., Journal du Palais (1910) II, 6; In re Romillieux, Journal 
 du Palais (1910) II, 106. 
 
 Where in an already completed contract a power of revocation by notice is 
 reserved, the notice is not operative until it is actually received. Crown Point 
 Iron Go. v. JBtna Ins. Co., 127 N. Y. 608, 28 N. E. 653, 14 L. R A 147 (1891)- 
 Wheeler v. McStay, 160 Iowa, 745, 141 N. W. 404, Ia R. A. 1915B, 181 (1913) ■' 
 Fritz V. Pennsylvania Fire Ins. Co., 85 N. J. Law, 171, 88 Atl 1065 50 L 
 R. A. (N. S.) 35 (1913) ; Hoban v. Hudson, post, p. 203. And see note In 50 
 L. R. A. (N. S.) 35. 
 
Sec. 3) ACCEPTANCE BY POST 43 
 
 letter accepting the offer had been received by the person making the 
 offer ; and the correctness of that defcision is maintained, upon an able 
 and elaborate discussion of reasons and authorities, in Langd. Cpnt. 
 (2d Ed.) 989-996. In England, New York and New Jersey, and in the 
 supreme court of the United States, the opposite view has prevailed, 
 and the contract has been deemed to be completed as soon as the letter 
 of acceptance has been put into the post office duly addressed. Adamis 
 v. Lindsell, 1 Barn. & Aid. 681 ; Dunlop v. Higgins, 1 H. L,. Cas. ^81, 
 398^00; Newcomb v. De Roos, 2 El. & El. 271 ; Harris' Case, L. "R. 
 7 Ch. 587; Lord Blackburn, in Brogden v. Railway, 2 App. Cas. 666, 
 691, 692; Insurance Co. v. Grant, 4 Exch. Div. 216; Eindley, J., in 
 Byrne v. Van Tienhoven, 5 C. P. Div. 344, 348 ; 2 Kent, Comm. 477, 
 note c; Mactier v. Frith, 6 Wend. (N. Y.) 103, 21 Am. Dec. 262; Vas- 
 sar v. Camp, 11 N. Y. 441; Trevor v. Wood; 36 N. Y. 307, 93 Am. 
 Dec. 511 ; Halloclc y. Insurance Co., 26 N. J. Law, 268, 27 N. J. Law, 
 645, 72 Am. Dec. 379; Tayloe v. Insurance Co., 9 How. 390, 13 L. Ed. 
 187. 
 
 But this case does not require a consideration of the general ques- 
 tion ; for, in any view, the person making the offer may always, if he 
 chooses, make the fornlation of the contract which he proposes depend- 
 ent upon the actual communication to himself of the acceptance. The- 
 siger, L. J., in Insurance Co. v. Grant, 4 Exch. Div. 223 ; Pol. Cont. 
 (2d Ed.)- 17; Leake, Cont. 39, note. And in the case at bar, the letter 
 written in the plaintiff's behalf by her husband as her agent on July 8, 
 1878, in California, and addressed to the defendant at Boston, appears 
 to us clearly to manifest such ah intention. After proposing the terms 
 of an agreement for a new lease, he says, "If you agree to this plan, 
 and. will telegraph me on receipt of this, I will forward power of at- 
 torney, to Mr. Ware," the plaintiff's attorney in Boston. "Telegraph 
 me 'Yes' or 'No.' If 'No,' I will go on at once to Boston with my wife, 
 and between us we -will try to recover our lost ground. If I do not 
 hear from you by the 18th or 20th, I shall conclude 'No.' " Taking 
 the whole letter together, the offer is made dependent upon an actual 
 communication to the plaintiff of the defendant's acceptance on or be- 
 fore the 20th of July, and does not discharge the old lease, nor bind the 
 plaintiff to execute a new one, unless the acceptance reaches California 
 within that time. Assuming, therefore, that the defendant's delivery 
 of a despatch at the telegraph office had the same effect as the mailing 
 of a letter, he has no ground of exception to the ruling at the trial. 
 . Exceptions overruled.^'' 
 
 • 2 7 See, also, Postal Tel. Cahle Co. v. Louisville Cotton Seed Oil Co., 140 Ky. 
 506, 131 S. W. 277 (1910). 
 
44 OFFEE AND AOCEPTANCH (Ch. 1 
 
 TREVOR et al. v. WOOD et al. 
 (Court of Appeals of New York, 1867. 36 N. T. 307, 93 Am. Dee. 511.) 
 
 Appeal from a judgment of the Supreme Court rendered at General 
 Term, in the first district, reversing a judgment entered upon the re- 
 port of Hon. William Mitchell, referee, and ordering a new trial be- 
 fore the same referee. 
 
 The appellants have stipulated that if the judgment be'afBrmed, 
 judgment absolute may be entered against them. 
 
 The appellants are dealers in bullion in New York, and the respond- 
 ents are dealers in bullion in New Orleans. In 1859 they agreed to 
 deal with each other in the purchase and sale of dollars, and that all 
 commuhications between them in reference to such transactions should 
 be by telegraph. 
 
 Or January 30th, 1860, the appellants telegraphed from New York 
 to the respondents, at New Orleans, asking at what price they would 
 sell 100,000 Mexican dollars. On the 31st of the same month the re- 
 spondents answered that they would deliver 50,000 at 7i^ ; and on the 
 same day the appellants telegraphed from New York to the defend- 
 ants, at New Orleans, as follows : 
 "To John Wpod & Co. : , 
 
 "Your offer, 50,000 Mexicans at 71^, accepted; send more if you 
 can. Trevor & Colgate." 
 
 At the same time the appellants sent by mail to the respondents a 
 letter acknowledging the receipt of the respondents' telegram, and 
 copying, the appellants' telegraphic answer. On the same day the re- 
 spondents had also sent by mail a letter to the appellants, copying re- 
 spondents' telegram of that date. On the next day (February 1st, 
 1860) the appellants again telegraphed to the respondents as follows : 
 "To John Wood & Co. : 
 
 "Accepted by telegraph yesterday, your offer for 50,000 Mexicans ; 
 send as many more, same price. Reply. 
 
 "Trevor & Colgate." 
 
 This telegram, as well as that of January 31st, from the appellants, 
 did not reach the respondents until 10 a. m. on February 4th, 1860, in 
 consequence of some derangement in a part of the line used by the 
 appellants, but which was not known to the appellants until February 
 4th, when the telegraph company reported the line down. On Febru- 
 ary 3d the respondents telegraphed to the appellants as follows : "No 
 answer to our despatch— rdollars are sold." And on the same day they 
 wrote by mail to the same effect. The appellants received this despatch 
 on the same day, and answered it on the same day as follows • 
 "To John Wood & Co. : 
 
 "Your offer was accepted on receipt." 
 
 And again the next day: 
 
 "The dollars inust come, or we will hold you responsible. Reply. 
 
 "Trevor & Colgate."' 
 
Sec. 3) ACCEPTANCE BY POST 45 
 
 And again on February 4th insisting on the dollars being sent "by 
 this or next steamer," and -saying, "Don't fail to send the dollars at 
 any price." 
 
 On the same February 4th the respondents telegraphed to appel- 
 lants: "No dollars to be had. We may ship by steamer twelfth, as 
 you propose, if we have them." No dollars were sent, and this action 
 was brought to recover damages for an alleged breach of contract in 
 not delivering them. The referee found for the plaintiff $219.33. 
 
 ScRUGHAM, J. ^' The pflEer of the respondents was made on Janu- 
 ary 31st, and they did not attempt to revoke it until February 3d. The 
 offer was accepted by the appellants before, but the respondents did 
 not obtain knowledge of the acceptance until after this attempted revo- 
 cation. The principal question, therefore, which arises in the case, is 
 whether a contract was created by this acceptance before knowledge 
 of it reached the respondents. 
 
 The case of Mactier v. Frith, in the late "Court of Errors (6 Wend. 
 103, 21 Am. Dec. 262) settles this precise question, and was so regard- 
 ed b}- this court in Vassar v. Camp, 11 N. Y. 441, where it is said that 
 the principle established in the case of Mactier v. Frith was that 
 it was only necessary "that there should be concurrence of the minds 
 of the parties upon, a distinct proposition manifested by an overt act; 
 and that the sending of a letter announcing a consent to the proposal 
 was a sufficient manifestation and consummated the contract from the 
 time it was sent." 
 
 There is nothing in either the case of Mactier v. Frith nor in that 
 of Vassar v. Camp, indicating that this effect is given to the sending 
 of a letter, because it is sent by mail through the public post-office, and 
 in fact the letter referred to in the first case could not have been so 
 sent, for it was to go from the city of New York to Jacmel, in the 
 island of St. Domingo, between which places there was at that tilne 
 no communication by mail. 
 
 The sending of a letter accepting the proposition is regarded as an 
 acceptance, because it is an overt act clearly manifesting the intention 
 of the party sending it to close with the offer of him to which it is sent, 
 and thus marking that aggregatio mentium which is necessary to con- 
 stitute a contract. * * * 
 
 It was agreed between these parties that their business should be 
 transacted through the medium of the telegraph. The object of this 
 agreement was to substitute the telegraph for other methods of com- 
 munication, and to give to their transactions by it the same force and 
 validity they would derive if they had been performed through other 
 agencies. In accordance with this agreement the offer was made by 
 telegraph to the appellants in New York, and the acceptance addressed 
 to the respondents in New Orleans, and immediately despatched from 
 New York by order of the appellants. It cannot, therefore, be said 
 
 !>* Parts of the opinion are omitted. 
 
46 OFFER AND ACCEPTANCE (Ch. 1 
 
 that the appellants did not put their acceptance in a proper way to be 
 communicated to the respondents, for they adopted the method of com- 
 munication which had been used in the transaction by the respondents, 
 and which had been selected by prior agreement between them as that 
 by means of which their business should be transacted. 
 
 Under these circumstances the sending of the despatch must be re- 
 garded as an acceptance of the respondents' offer, and thereupon the 
 contract became complete. 
 
 I cannot conceive upon what principle an agreement to communi- 
 cate by telegraph can be held to be in effect a warranty by each party 
 that his communication to the other shall.be received. On the con- 
 trar}"-, by agreeing beforehand to adopt that means of communication 
 the parties mutually assume its hazards, which are principally as to 
 the prompt receipt of the despatches. * * * 
 
 Judgment reversed.^' 
 
 HENTHORN v. FRASER. 
 (In the Court of Appeal, 1892. L. R. [1892] 2 Ch. 27.) 
 
 In 1891 the plaintiff was desirous of purchasing from the Huskisson 
 Benefit Building Society certain houses in Flamank Street, Birken- 
 head. In May he, at the office of the society in Chapel Street, Liv- 
 erpool, signed a memorandum drawn up by the secretary, offering 
 £600 for the property, which offer was declined by the directors; 
 and on July 1st he made in the same way an offer of £700, which 
 was a,lso declined. On July 7th he again called at the office, and the 
 secretary verbally offered to sell to him for £750. This offer was re- 
 duced into writing, and was as follows : 
 
 "I hereby give you the refusal of the Elamank Street property at 
 £750 for fourteen days." 
 
 The secretary, after signing tliis, handed it to the plaintiff, who took 
 it away with him for consideration. 
 
 On the morning of the 8th another person called at the office 
 and offered £760 for the property, which was accepted, and a con- 
 tract for purchase signed, subject to a condition for avoiding it if the 
 
 2 8 If the offer is by telegraph, the acceptance is complete when the telegram 
 of acceptance is filed. Minnesota Linseed Oil Co. v. Collier White T^ead Co 4 
 Dill. 431, Fed. Cas. No. 9,635 (1876) ; Brauer v. Shaw, 168 Mass. 198, 46 N E 
 617, 60 Am. St. Rep. 387 (1897), disregarding McCulloch v. Eagle Ins. Co "i 
 Pick. (Mass.) 278 (1822) ; Haas v. Myers, 111 111. 421, 53 Am. Rep. 634 (1884). 
 Whether the use of the telegraph is Impliedly .authorized is a question of fact 
 Perry v. Blount Hope Iron Co., 15 R. I. 380, 5 Atl. 632, 2 Am. St. Ren 902 
 (1886). 
 
 In Farmers' Produce Co. v. McAlester Storage & Commission Co 48 Okl 
 488, 150 Pac. 483, L. R. A. 1916A, 1297 (1915), the offer was by telegram from' 
 Wisconsin and the acceptance was by mail from Oklahoma on the same day 
 A few hours after mailing the acceptance a telegram of revocation of the offer 
 was received. It was held that there was a contract; the court believin"- 
 Oiat the post was a contemplated means of communication. " 
 
>5ec. 3) ACCEPTANCE BY POST 47 
 
 society found that they could not withdraw from the offer to the 
 plaintiff. 
 
 Between 12 and 1 o'clock on that day the secretary posted to the 
 plaintiff, who resided in Birkenhead,' the following letter : 
 
 "Please take notice that my letter to you of the 7th instant, giving 
 you the option of purchasing the property, Flamank Street, Birken- 
 head, for £750, in fourteen days, is withdrawn, and the offer can-, 
 celled." 
 
 This letter, it appeared, was delivered at the plaintiff's address 
 between 5 and 6 in the evening, but, as he was out, did not reach his 
 hands till about 8 o'clock. 
 
 On the same July 8th the plaintiff's solicitor, by the plaintiff's 
 direction, wrote to the secretary as follows : 
 
 "I am instructed by Mr. James Henthprn to write you, and ac- 
 cept your offer to sell the property, 1 to 17 Flamank Street, Birkenhead, 
 at the price of £750. Kindly have contract prepared and forwarded 
 to me." 
 
 This letter was addressed to the society's office, and was posted in 
 .Birkenhead at 3 :50 p. m., was delivered at 8 :30 p. m. after the closing 
 of the office, and was received by the secretary on the following morn- 
 ing. The secretary replied, stating that the society's offer had been 
 withdrawn. 
 
 The plaintiff brought this action in the Court of the County Pala- 
 tine for specific performance. The Vice-Chancellor dismissed the 
 action, and the plaintiff appealed. 
 
 Lord Herschsll. '"' This is an action for the specific performance 
 of a contract to sell to the plaintiff certain house property situate in 
 Flamank Street, Birkenhead. The action was tried before the Vice- 
 Chancellor of the County Palatine of Lancashire, who gave judg- 
 ment for the defendants. * * * 
 
 If the acceptance by the plaintiff of the defendants' offer is to be 
 treated as complete at the time the letter containing it was posted, 
 I can entertain no doubt that the society's attempted revocation of 
 the offer was wholly ineffectual, I think that' a person who has 
 made an offer must be considered as continuously making it until he 
 has brought to the knowledge of the person to whom it was made 
 that it is withdrawn. This seems to me to be in accordance with 
 the reasoning of the Court of King's Bench in the case of Adams v. 
 Lindsell [1 B. & Aid. 681], which was approved by the Lord Chancellor 
 in Dunlop v. Higgins [1 H. L. C. 381, 399], and also with the opinion 
 of Lord Justice MeUish in Harris's Case [L. R. 7 Ch. 587]. The very 
 point was decided in the case of Byrne v. Van Tienhoven [5 C. P. D. 
 344] by Lord Justice Lindley, and his decision was subsequently fol- 
 lowed by Mr. Justice Lush. The grounds upon which it has been held 
 
 so Part of tUs opinion and the concurring opinions of Lindley and Kay, 
 Ia JJ., have been omitted. 
 
48 OFFER AND AOCEPTAJJCB (Ch. 1 
 
 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 A^hom the offer is made. But it is 
 contended on behalf of the defendants that the acceptance was com- 
 plete only when received by them and not on the letter being posted. 
 It cannot, of course, be denied, after the decision in Dunlop v. Hig- 
 gihs in the House of Lords, that, where an offer has been made 
 through the medium of the post, the contract is complete as soon as 
 the acceptance of the offer is posted, but that decision is said to be 
 inapplicable here, inasmuch as the letter containing the offer was 
 not sent by post to Birkenhead, but handed to the plaintiff in the 
 defendants' office at Liverpool. The question therefore arises in what 
 circumstances the acceptance of an offer is to be regarded as com- 
 plete as soon as it is posted. In the case of the Household Fire and 
 Carriage Accident Insurance Company v. Grant [4 Ex. D. 216], Lord 
 Justice Baggallay said : "I think that the principle established in Dun- 
 lop v. Higgins is limited in its appHcation to cases in which by reason 
 of general tisage, or of the relations between the parties to any par- 
 ticular transactions, or of the terms in which the offer is made, the 
 acceptance of such offer by a letter through the post is expressly or 
 impliedly authorized." And in the same case Lord Justice Thesiger 
 based his judgment on the defendant having made an application for 
 shares under circumstances "from which it must, be implied that he 
 authorized the company, in the event of their allotting to him the 
 shares applied for, to send the notice of allotment by post." The facts 
 of that case were that the defendant had, in Swansea, where he re- 
 sided, handed a letter of application to an agent of the company, their 
 place of business being situate in London. It was from these circum- 
 stances that the Lords Justices implied an authority to the company to 
 accept the defendant's offer to take shares through the medium of 
 the post. Applying the law thus laid down by the Court of Appeal, I 
 think in the present case an authority to accept by post must be implied. 
 Although the plaintiff received the offer at the defendants' office in 
 Liverpool, he resided in another town, and it must have been in con- 
 templation that he would take the offer, which by its terms was to re- 
 main open for some days, with him to his place of residence, . and 
 those who made the offer must have known that it would be according 
 to the ordinary usages of mankind that if he accepted it he should 
 communicate his acceptance by means of the post. I am not sure that 
 I should myself have regarded the doctrine that an acceptance is com- 
 plete as soon as the letter containing it is posted as resting upon an 
 implied authority by the person making the offer to the person re- 
 ceiving it to accept by those means. It strikes me as somewhat ar- 
 tificial to speak of the person to whom the offer is made as having 
 the implied authority of the other party to send his acceptance by 
 
Sec. 3) ACCEPTANCE BY POST 49 
 
 post. He needs no authority to transmit the acceptance through any 
 particular channel; he may select what means he pleases, the post- 
 office no less than any other. The only effect of the supposed author- 
 ity is to make the acceptance complete so soon as it is posted, and 
 authority will obviously be implied only when the tribunal considers 
 that it is a case in which this result ought to be reached. I should 
 prefer to state the rule thus : Where the circumstances are such that it 
 must have been within the contemplation of the parties that, according 
 to the ordinary usages of mankind, the post might be used as a'means 
 of communicating the acceptance of an offer, the acceptance is com- 
 plete as soon as posted.^^ It matters not in which way the prop- 
 osition be stated, the present case is in either view within it. The 
 learned Vice-Chancellor appears to have based his decision" to some 
 extent on the fact that before the acceptance was posted the defend- 
 ants had sold the property to another person. The case of Dickinson 
 V. Dodds [2 Ch. D. 463] was relied upon in support of that defence. 
 In that case, however, the plaintiff knew of the subsequent sale be- 
 fore he accepted the offer, which, in my judgment, distinguishes it 
 entirely from the present case. For the reasons I have given, I think 
 the judgment must be reversed and the usual' decree for specific 
 performance made. The respondents must pay the costs of the appeal 
 and of the action. 
 
 ELIASON et al. v. HENSHAW. 
 (Supreme Court of the United States, 1819. 4 Wheat. 225, 4 L. Ed. 556.) 
 
 Error to Circuit Court for the District of Columbia. 
 
 Washington, J. This is an action, brought by the defendant in er- 
 ror, to recover damages for the non-performance of an agreement, ail- 
 leged to have been entered into by the plaintiffs in error, for the 
 purchase of a quantity of flour at a stipulated price. The evidence of 
 this contract given in the court below, is stated in a bill of exceptions, 
 and is to the following effect: A letter from the plaintiffs to the de- 
 fendant, dated the 10th of February, 1813, in which they say : "Cap- 
 tain Conn informs us that you have a quantity of flour to dispose of. 
 We are in the practice of purchasing flour at all times, in Georgetown, 
 and will be glad to serve you, either in receiving your flour in store, 
 when the markets are dull, and disposing of it when the markets Av.ill 
 answer to advantage, or we will purchase at market price when de- 
 livered; if you are disposed to engage two or three hundred barrels at 
 present, we will give you. $9. 50 per barrel, deliverable the first water 
 in Georgetown, or any service we can. If you should want an ad- 
 vance, please write us by mail, and will send you part of the money 
 in advance." In a postscript they add: "Please write by return of 
 
 31 Quoted and followed in Farmers' Produce Co. v. McAles+er Storage & 
 Commission Co., 48 Okl. 488, 150 Pac. 483, L. R. A. 1916A, 1297 (1915); 
 
 OOEBIN CONT. 4 
 
50 OFFER AND ACCEPTANCE (Ch. 1 
 
 wagon whether you accept our offer." This letter was sent from the 
 house at which the writer then was about two miles from Harper's 
 Ferry, to the defendant at his mill, at Mill Creek, distant about 20 
 miles from Harper's Ferry, by a wagoner then employed by the de- 
 fendant .to haul flour from his mill to Harper's Ferry, and then about 
 to return home with his wagon. He delivered the letter to the defend- 
 ant on the 14th of the same month, to which an answer, dated the suc- 
 ceeding day was written by the defendant, addressed to the plaintiffs 
 at Georgetown, and dispatched by a mail which left Mill Creek on the 
 19th, being the first regular mail from that place to Georgetown. In 
 this letter the writer says : "Your favor of the 10th inst. was handed 
 me by Mr. Chenoweth last evening. I take the earliest opportunity to 
 answer it by post. Your proposal to engage 300 barrels of flour, de- 
 livered in Georgetown by the first water, at $9.50 per barrel, I accept, 
 and shall send on the flour by the first boats that pass down from 
 where my flour is stored on the river ; as to any advance, will be un- 
 necessary — payment on delivery is all that is required." 
 
 On the 2Sth of the same month, the plaintiffs addressed to the de- 
 fendant an answer to the above, dated at Georgetown, in which they 
 acknowledge the receipt of it, and add : "Not having heard from you 
 before, had quite given over the expectation of getting your flour, 
 more particularly as we requested an answer by return of wagon the 
 next day, and as we did not get it, had bought all we wanted." 
 
 The wagoner, by whom the plaintiffs' first letter was sent, informed 
 them, when he received it, that he should not probably return to Har- 
 per's Ferry, and he did not in fact return in the defendant's employ. 
 The flour was sent down to Georgetown, some time in March, and the 
 delivery of it to the plaintiffs was regularly tendered and refused. 
 f Upon this evidence, the defendants in the court below, the plaintiffs 
 in error, moved that court~to instruct the jury, that, if they believed 
 the said evidence to be true, as stated, the plaintiff in this action was 
 not entitled to recover the amount of the price of the 300 barrels of 
 flour, at the rate of $9.50 per barrel. The court being divided in 
 opinion, the instruction prayed for was not given. 
 
 The question is, whether the court below ought to have given the 
 instruction to the jury, as the same was prayed for? If they ought, 
 the judgment, which was in favor of the plaintiff in that court, must 
 be reversed. 
 
 It is an undeniable principle of the law of contracts, 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 terms in 
 which the offer was made. Any qualification of, or departure from, 
 those terms, invalidates the offer, unless the same be agreed to by the 
 person who made it. Until the terms of the agreement have received 
 the assent of both parties, the negotiation is open, and imposes no ob- 
 ligation upon either. . 
 
Sec. 3) ACCEPTANCE BY POST 51 
 
 In this case, the plaintiffs in error offered to purchase from the 
 defendant two or three hundred barrels of flour, to be delivered at 
 Georgetown, by the first water, and to pay for the same $9.50 per 
 barrel. To the letter containing this offer, they required an answer 
 by the return of the wagon, by which the letter was dispatched. 
 This wagon was, at that time, in the service of the defendant, and em- 
 ployed by him in hauling flour from his mill to Harper's Ferry, near 
 to which place the plaintiffs then were. The meaning of the writers 
 was obvious. They could easily calculate by the usual length of time 
 which was employed by this wagon, in travelling from Harper's Ferry 
 to Mill Creek, and back again with a load of flour, about \vhat time 
 they should receive the desired answer, and, therefore, it was entirely 
 unimportant, whether it was sent by that, or another wagon, or in any 
 other manner, provided it was sent to Harper's Ferry, and was not de- 
 layed beyond the time which was ordinarily employed by wagons en- 
 gaged in hauling flour from the defendant's mill to Harper's Ferry. 
 Whatever uncertaiiity there might have been as to the time when the 
 answer would be received, there was none as to the place to which it 
 was to be sent; this was distinctly indicated by the mode pointed out 
 for the conveyance of the answer. The place, therefore, to which the 
 answer was to be sent, constituted an essential part of the plaintiff's 
 offer. 
 
 It appears, however, from the bill of exceptions, that no answer to 
 this letter was at any time sent to the plaintiffs, at Harper's Ferry. 
 Their offer, it is true, was accepted by the terms of a letter addressed 
 Georgetown, and received by the plaintiffs at that place; but an ac- 
 ceptance communicated at a place different from that pointed out by 
 the plaintiffs, and forming a part of their proposal, imposed no obliga- 
 tion binding upon them, unless they had acquiesced in it, which they 
 declined doing. 
 
 It is no argument, that an answer was received at Georgetown ; the 
 plaintiffs in error had a right to dictate the terms upon which they 
 would purchase the flour, and, unless they were complied with, they 
 were not bound by them. All their arrangements may have been 
 made with a view to the circumstance of place, and they were the only 
 judges of its importance. There was, therefore, no contract concluded 
 between these parties; and the court ought, therefore, to have given 
 the instruction to the jury, which was asked for. 
 
 Judgment reversed. Cause remanded with directions to award a 
 venire facias de novo. 
 
52 OFFER AND ACCEPTANCE (Ch. 1 
 
 SECTION 4.— ACCEPTANCE BY OVERT ACT 
 (But Not by Post) 
 
 ROGERS V. SNOW. 
 (In the King's Bench, 1578. Dalison, 94.) 
 
 In an action on the case between Daniel Rogers and Daniel Snow, 
 the plaintiff alleged that whereas the brother of the defendant was in- 
 debted to the plaintiff in the sum of £303, in consideration that the 
 plaintiff would taken the personal bond of the brother without surety 
 and would not sue him until Michaelmas and would forbear to claim 
 the money during that time, the defendant promised to pay it to the 
 plaintiff. Issue was joined and verdict for plaintiff. 
 
 Gawdy, Jun., moved that the declaration was bad because the plain- 
 tiff did not allege that the consideration was performed on his part. 
 Just as in case I promise a man 20s. if he will go to York for me, in 
 an action on the case on this promise he must allege the performance 
 on his own part. 
 
 The Court conceded this to be true and judgment was therefore 
 arrested.^^ 
 
 MOTT V. JACKSON et al. 
 (Supreme Court of Alabama, 1911. 172 Ala. 448, 55 South. 528.) 
 
 Action by John D. Mott against M. R. Jackson and others. Judg- 
 ment for defendants, and plaintiff appeals. Reversed, rendered, and 
 remanded. 
 
 The complaint is as follows : 
 
 Count 1 :. "Plaintiff claims of the defendants the sum of $1,500 dam- 
 ages, for that, whereas, on, to wit, the 22d day of January, 1908, the 
 said defendants were engaged in running a steamboat, viz., the Liberty, 
 as a common carrier on the navigable waters of Alabama, and on or 
 about such time promised and agreed as such carriers to and with 
 plaintiff to receive for him for hire on the next down trip of the boat, 
 and on said trip to carry for him, a lot of staves, to wit, 10,000 in num- 
 ber, from Davis' Bluff, a landing on the Tombigbee river, and deliver 
 the same safely at the wharves or docks in the city of Mobile, in the 
 state of Alabama, for a reward then and there to be paid by the said 
 plaintiff; that plaintiff, in consideration of said promise on the part 
 of the defendants to carry said staves, had the same placed on the 
 margin of the river at the usual and customary place for loading that 
 
 3 2 Of course, performance might be a condition precedent to the defendant's 
 duty to pay even tliough It is not the required mode of acceptance. See Chap- 
 ter 1 V, post. 
 
Sec. 4) ACCEPTANCE BY OVERT ACT 53 
 
 kind of freight on said steamboat, the Libei-ty, and when the said boat 
 ai-rived on the said down trip announced himself willing to load said 
 staves on said boat, when defendants willfully, knowingly, and wrong- 
 ly neglected and refused to take said staves. And plaintiff alleges that 
 their refusal was without just cause or good excuse, and that before 
 plaintiff had shipped said staves by any other carrier a freshet came 
 in the river and washed said staves away, and they became entirely 
 lost to plaintiff." * * * 
 
 The demurrers take the point that no consideration for the defend- 
 ants' promise is alleged, and because the count does not allege that the 
 plaintiff agreed and bound himself to ship some staves and pay the 
 freight thereon, and others not necessary to be here set out.^^ 
 
 Simpson, J. This action is by the appellant against the appellees, as 
 common carriers, by water, for damages for refusal to receive freight. 
 Demurrers were sustained to the complaint, as amended, the plaintiff 
 refused to amend, and the errors claimed are the action of the court in 
 sustaining the demurrers to the several counts of the complaint. 
 
 The counts of the complaint (which will be set out by the reporter) 
 are on the contract, and not ex delicto. Wilkinson v. Moseley, 18 Ala. 
 288, 290, et seq.; Mobile Life Ins. Co. v. Randall, 74 Ala. 170, 176; 
 McDaniel v. Johnston, ll6 Ala. 526, 532, 19 South. 35 ; Southern Rail- 
 way Co. V. Rosenberg, 129 Ala. 287, 30 South. 32 ; W. U. Tel. Co. v. 
 Lmleton, 169 Ala. 99, 53 South. 97. 
 
 The insistence of the appellees is that the contract set out in the sev- 
 eral counts of the complaint is unilateral, and does not allege any 
 consideration for the promise or any acceptance of the offer. It is fa- 
 miliar contract law that where one party makes an offer, dependent 
 upon some act of the other party, and the other party performs the act, 
 that is an acceptance of the offer, and constitutes a sufficient considera- 
 tion to support the contract. 6 Cyc. 429, and notes. It is true that a 
 mere general offer by a carrier to receive and transport goods generally 
 would be too indefinite, and would include nothing but its common- 
 law liability, and under such an offer a failure to receive goods for 
 shipment would be subject to the defenses applicable to an action on 
 the common-law duty, such as that the vessel was already loaded to 
 its full capacity ; but when the carrier says to the shipper, "I will re- 
 ceive and carry your freight at a particular time [as on the next down 
 trip of the boat] and at a particular place [as at Davis' Bluff]," it can- 
 not mean anything except that "I will have the space and facilities, 
 when the boat reaches said landing, to receive your goods, and if you 
 will have them there at that time I will receive and transport them." 
 It is true that, up to that time, the carrier's promise was but an offer, or 
 a proposition ; but, if it had desired to protect itself agiinst the con- 
 tingency of the shipper's not accepting the proposition, by having his 
 goods ready for shipment, or of his receiving a boat load of freight 
 
 S3 Counts 2 and 3 and a part of the oriinion are omitted. . 
 
54 OFFER AND ACCEPTANCE (Ch. 1 
 
 before reaching said point, he should have required a specific acceptance 
 of the proposal, or inserted a proviso as to space, etc. 
 
 The appellees insist that the offer should specify whether it is to 
 be accepted by promise or by act. While a party making an offer has 
 a right to specify how it shall be accepted, in order to complete the 
 contract, yet, if he does not so specify, it is clear that anything which 
 in law would be an acceptance, so long as the offer is left open, would 
 be sufficient, and an acceptance by act is as effective as acceptance by 
 words. In an early English case it was said : "If I say to another, 'If 
 you will go- to York, I will give you £100,' that is, in a certain sense, a 
 unilateral contract. He has not promised to go to York. But, if he 
 goes, it cannot be doubted that he will be entitled to receive the £100. 
 His going to York at my request is a sufficient consideration for my 
 promise." Gt. N. Ry. Co. v. Witham, 9 Law Rep. (C. C. P.) 12, 19. 
 If the shipper had been standing on the river baink, and the captain 
 of the boat had said, "I will take your staves and carry them to Mobile 
 for a reasonable compensation," and the shipper, without saying a 
 word, had immediately delivered the goods to the boat, or offered them 
 to its employes, it cannot be doubted that that would have been a 
 sufficient acceptance to close the contract. The offer, then, being still 
 open and unrevoked, was necessarily a continuing one, and its ac- 
 ceptance at one time as effectual as at another. * * * 
 
 Reversed and demurrers overruled.^* 
 
 HIGH WHEEL AUTO PARTS CO. v. JOURNAL CO. OF TROY. 
 (Appellate Court Of Indiana, 1912. 50 Ind. App. 396, 98 N. E. 442.) 
 
 Action by the Journal Company of Troy against the High Wheel 
 Auto Parts Company and others. Judgment for plaintiff, and defend- 
 ants appeal. Affirmed. 
 
 Adams, J.^' During the week of October 5-10, 1908, the appellee 
 managed an automobile exhibit at Grand Central Palace, New York. 
 The appellant was a manufacturer of automobiles, and desired to make 
 a display at this exhibition. On August 8, 1908, the appellants sent 
 the following order to appellee: 
 
 "Muncie, Ind., Aug. 8, 1908. 
 
 "Journal Company of Troy, Troy, N. Y. — Gentlemen: You will 
 please reserve for us 234 square feet of space in 44th St., section main 
 
 3* In Lamb v. Prettyman, 33 Pa. Super. Gt. 190 (1907) an agent sued for a 
 commission: "Tbe counsel for defendant contends that when Prettyman asked 
 Lamb 'to get a deal,' Lamb did not agree to do so and therefore there was no 
 contract. The answer to this is that it was not necessary for Lamb to say 
 in words that he would act ; he could make it a contract by performance, and 
 there is evidence that he did procure a party to deal with the defendant. 
 Where acceptance of a proposition is by a promise, it must presently follow 
 the offer and notice of it be given to the other party. But where acceptance 
 is by act, the mere performance of the act, without notice, concludes the con- 
 tract." 
 
 3 6 Parts of the opinion are omitted. 
 
Sec. 4) ACCEPTANCE BY OVERT ACT 55 
 
 exhibit floor, as per 'diagram below, for which we agree to pay you at 
 the rate of one dollar ($1.00) per square foot, total $234.00. Terms : 25 
 per cent, to accompany signed contract ; balance on Saturday, August 
 1, 1908. The rules and regulations printed on the last page of this 
 contract form a part thereof. 9 ft. front, 26" deep. High Wheel Au- 
 to Parts Co., H. L. Warner, Mgr." 
 
 This order is made a part of the complaint; and it is averred that 
 upon receipt tliereof the appellee at once set apart the space in the ex- 
 hibition building numbered and described in the contract, and held the 
 same for appellants, unoccupied and unused by any other exhibitor dur- 
 ing the exhibition. It is also averred that 25 per cent, of the contract 
 price accompanied the order, and that appellants have failed and re- 
 fused to pay the balance, after demand, and that the sum of $177 is 
 due and wholly unpaid. * * * 
 
 A demurrer to the complaint was overruled, and appellants filed 
 three paragraphs of special answer, to which the court sustained a de- 
 murrer, and this ruling constitutes the error relied upon for reversal. 
 These paragraphs of answer * * * also averred that on account 
 of illness in the family of appellant Warner it was impossible for ap- 
 pellants to arrange to attend the exhibition and use the space subscrib- 
 ed for; that about the 21st of September, 1908, appellants notified ap- 
 pellee that, on account of such illness in the family of appellant War- 
 ner, defendants would not be able to attend and occupy the space sub- 
 scribed for, and duly surrendered all claim to the same ; that appellee 
 "met such surrender by assuring the defendants that plaintiff would 
 do its best to sell said space, stating that no man could do better than 
 his best, and claiming that if it could not sell said space, it would hold 
 , defendants for the payment therefor." Appellants replied to appellee 
 that they would lose what they had already paid, but would not pay 
 for space which they would not use. 
 
 The points urged by appellant are (1) that the contract sued on is 
 unilateral, and the complaint does not show an enforceable obligation ; 
 and (2) that the usage set up in the answers became a part of the con- 
 tract, and proof of the same would defeat a recovery in this case. 
 
 A unilateral contract is a legal solecism. There is no such thing as 
 a one-sided . contract. The term, however, has found a place in the 
 books, as expressing the idea of a contract lacking in mutuality. The 
 order sued on in this action w^s primarily unilateral ; but upon accept- 
 ance by appellee it became binding upon the parties, and upon per- 
 formance either might enforce it. It is a rule so well settled as to be 
 almost elemental that, where a contract or order is signed by one of 
 the contracting parties and accepted by the other, and affirmative acts 
 constituting the consideration done by the latter, the party signing can- 
 not assert a want of mutuality in the instrument. * * * 
 
 Judgment affirmed. 
 
56 OFFBE AND ACCEPTANCE (Ch. 1 
 
 TROUNSTINE et al. v. SELLERS. 
 (Supreme Court of Kansas, 1886. 35 Kan. 447, 11 Pac. 441.) 
 
 This was an action of replevin, brought by A. & J. Trounstine & 
 Co. to recover from A. H. Sellers the possession of a stock of ready- 
 made clothing of the alleged value of $2,085.20. To a judgment for 
 the defendant, the plaintiffs excepted.^" 
 
 Johnston, J. The right of possession to the clothing in controversy 
 depends upon whether the proposition made to the plaintiffs by Moore 
 & Weaver, on November 16, 1884, was accepted and became a con- 
 tract before the execution- of the mortgages by Moore & Weaver to 
 their creditors on tlie fifteenth day of December, 1884. It appears that 
 the plaintiffs, Vvho were engaged in the wholesale clothing business 
 at Cincinnati, Ohio, sold on credit a stock of clothing, through one 
 of their agetits, to Moore & Weaver, at Ottawa, Kansas. The goods 
 were sold a;nd shipped in the early part of September, 1884, upon the 
 terms that Moore & Weaver were to have a discount of 6 per cent, off 
 the prices named not later than 10 days after January 1, 1885, and 
 credit was given them until the expiration of that time for a discount. 
 On November 10, 1884, Moore & Weaver wrote to the plaintiffs, claim- 
 ing that if they did not choose to discount the bill within 10 days after 
 January 1, 1885, they were entitled to a credit of four months from 
 that time. The plaintiffs answered this letter oil the fourteenth of 
 November, 1884, insisting that the credit did not extend ^eyond 10 
 days after January 1, 1S85. Moore & Weaver again wrote to the 
 plaintiffs on November 16, 1884, insisting on the additional credit of 
 four months from January 1st, and, in closing their letter stated: 
 "If you think we are misrepresenting the facts in the case, we will re- > 
 turn the goods which we have on hand, and pay for what we have 
 sold out of them. Hoping to hear from you soon, we remain," etc. 
 This letter was received by the usual course of mail, but was never an- 
 swered. It seems that, soon after the plaintiffs received the letter of 
 November 16th, Mr. Harper, one of their firm, started out frorii Cin- 
 cinnati on a business trip, with the intention of attending to some im- 
 portant business matters of the firm in Indiana and Illinois which de- 
 manded immediate attention, and with a view of coming on to Ottawa 
 as soon as those matters were disposed of. He reached Ottawa on 
 the evening of December 16, 1884, one month, after the proposition 
 was made, when he demanded the possession of the goods from the 
 defendant. Sellers, who was in charge of them under the mortgages 
 executed the preceding day. 
 
 It is insisted by tTie plaintiffs that the court erred in not holding the 
 conduct of the plaintiff in starting from Cincinnati as an acceptance 
 of the proposal made by Moore & Weaver, and as a completion of 
 
 8 6 The statement of facts is abridged and part of the opinion ^s omitted. 
 
Sec. 4) ACCEPTANCE BY OVERT ACT 57 
 
 the contract, which vested the title and right of possession of the goods 
 in the plaintiffs. In our opinion, the conduct of the plaintiffs did not 
 indicate a purpose to accept the proposal made by Moore & Weaver, 
 and cannot be regarded as an acceptance. Although the proposition did 
 Aot, within itself, limit the time or manner of acceptance, it cannot be 
 regarded as a perpetual one, forever open to be accepted or rejected, 
 at the will of the plaintiffs. In Mactier v. Frith, 6 Wend. 103, 21 Am. 
 Dec. 262, the rule laid down with respect to a proposal made by letter 
 is that the offer continues until the letter containing it is received, 
 "and the party has had a fair opportunity to answer it." It has also 
 been held that "a letter written would not be an acceptance so long as 
 it remained in the possession or under the control of the writer. An 
 offer, then, made through a letter, is not continued beyond the time 
 that the party has a fair opportunity to answer it." Averill v. Hedge, 
 12 Conn. 424. Upon receipt of Moore & Weaver's letter the plaintiffs 
 were bound "to accept in a reasonable time, and give notice thereof, or 
 the defendant was no longer bound by the offer." Chicago & G. E. R. 
 Co. V. Dane, 43 N. Y. 240. See, also, Martin v. Black's Ex'rs, 21 Ala. 
 721 ; Moxley's Adm'rs v. Moxley, 2 Mete. (Ky.) 309 ; Minnesota Oil 
 Co. V. Colher Lead Co., 4 Dill. 431, Fed. Cas. No. 9,635 ; Judd v. Day, 
 50 Iowa, 247; faylor v. Rennie, 35 Barb. (N. Y.) 272; Benj. Sales, 
 61, note 7. 
 
 The offer which was made was the result of correspondence through 
 the mails, and, as the dates of the letters indicate, they had been 
 promptly answered and responded to by both the parties. Besides, the 
 letter containing the proposal, by its terms, enjoined an early reply. 
 It closes with the^words, "Hoping to hear from you soon," etc. While 
 the mode of acceptance was not indicated in the letter making the 
 offer, the nature of the negotiations, as well as the manner in which 
 they were carried on, suggested, not only the desire and necessity for 
 an early reply, but also that the parties making the offer would expect 
 an answer through and by the usual course of the mails. It has been 
 said that "where an individual makes an offer by post, stipulating for, 
 or by the nature of the business having the right to expect, an answer 
 by return post, the offer can only endure for a limited time, and the 
 making of it is accompanied by the implied stipulation that the answer 
 will be sent by return post. If that stipulation is not satisfied, the 
 person making the offer is released from it." Maclay v. Harvey, 90 111. 
 525, 32 Am. Rep. 35 ; Dunlop v. Higgins, 1 H. L. Cas. 387. 
 
 If the plaintiffs intended to accept the proposal, it was their duty 
 to have signified their acceptance, either through the mails, or by 
 some, equally expeditious means. The plaintiffs say that they deter- 
 mined to accept the proposition as soon as the offer was received, and 
 that Mr. Harper's act in starting to Ottawa was ah overt act, amount- 
 ing to an acceptance. Every overt act caused by a determination to ac- 
 cept a proposition does not constitute an acceptance. If it was the 
 intention of the plaintiffs to accept the offer, they could, arid most 
 
58 OFFER AND ACCEPTANCE (Ch. 1 
 
 likely would, have written Moore & Weaver a letter,, which was the 
 usual mode of communication between the parties, and which is the 
 usual mode of accepting an offer made by letter. Instead of sending a 
 letter or telegram announcing a determination to accept, one of them 
 started on a business trip through the country, intending finally to 
 come to Kansas, and take the goods, which trip consumed almost 30 
 days' time, during which time they were at Hberty to change their 
 purpose, and reject the proposition. The mere determination to ac- 
 cept an offer does not constitute an acceptance which is binding on 
 the parties. "The assent must either be communicated to the other 
 party, or some act must have been done which the other party has ex- 
 pressly or impliedly offered to treat as a communication." Benj. 
 Sales, 54. Where parties are distant, and the contract is to be made 
 by correspondence the writing of a letter or telegram containing a no- 
 tice of acceptance is not, of itself, sufficient to complete a contract. In 
 such a case the act must involve an irrevocable element, and the let- 
 ter must be placed in the mail, or the telegram deposited in the office, for 
 transmission, and thus placed beyond the power or control of the sender, 
 before the" assent becomes eff'ectual to consummate a contract, and 
 not then, unless the offer is still standing. See authorities above cited. 
 The action of the plaintiffs in sending a member ol the firm, by a 
 circuitous route, to Kansas, was no more than a mere mental assent, 
 which, as we have seen, is insufficient. There was no act of accept- 
 ance until Harper arrived at Ottawa, and demanded the goods. This 
 was not within a reasonable time, and, when the proposition was not 
 met within a reasonable time, Moore & Weaver were at liberty to re- 
 gard their proposition as rejected, and to make other disposition of 
 their property, which they manifestly did do. * * * 
 Judgment afiirmed. 
 
 DOOLITTLE v. CALLENDER. 
 
 (Supreme Court of Kebraska, 1911. 88 Neb. 747, 130 N. W. 436.) 
 
 FawcETT, J."' Plaintiff brought suit to recover an unpaid balance 
 upon the following contract : 
 
 "The Art League, Cut Makers, 656 Broadway, New York. No. 
 2,541. Book , A Series. Any arrangement made with repre- 
 sentative must be specified plainly on this order. 
 
 "Gentlemen : Send one cut (about 2 in. by 2 in., your A series) and 
 copy of reading matter per week to use in this city only, both such as 
 you think best to advertise the grocery business, for one year and aft- 
 er that until further notice. I will pay you fifty-five cents for 'each 
 cut, at the end of the quarter they are sent. In consideration of above, 
 this exclusive right is given. The Art League agrees upon accepting 
 
 S7 Parts of the opinion are omitted. 
 
Sec. 4) ACCEPTANCE BY OVERT ACT 53 
 
 this, not to send any of the cuts sent under this agreement to any one 
 else in the city mentioned, during the time. 
 
 "Dated, The Art League, Nov. 10, 1905. Per Jos. F. Taylor. 
 
 "C. E. Callender. [Name.] 
 
 "York, Nebr. [Address.]" 
 
 Defendant prevailed, and plaintiff appeals. 
 
 Within a few days after the execution of the above contract, plain- 
 tiff began mailing, weekly, to the defendant the cuts and reading mat- 
 ter called for by the contract, and defendant continued to receive them 
 without objection or complaint of any kind until February 6th follow- 
 ing, when he wrote plaintiff, acknowledging receipt of a statement, and 
 stating, "And before remitting for same would ask how much I must 
 remit, and you discontinue after 10th this month. I do not need any 
 more of them and shall not after that date.- It is not necessary to say 
 why, except that it is not to use something else instead." To this 
 plaintiff replied February 15th, stating that he could not afford to can- 
 cel the contract for anything less than 10 per cent, from the contract 
 price. Plaintiff continued to mail the cuts and defendant to receive 
 them without objection until the 30th of March' when defendant again 
 wrote plaintiff, stating, "I am now out of business and need no more 
 cuts. Discontinue sending them. I have paid for them to April 1st." 
 Plaintiff continued thereafter to mail the cuts and reading matter until 
 the end of the year; defendant refusing to take them from the post 
 office. * * * 
 
 We do not think the contract was void for lack of consideration, or 
 for want of mutuality, as urged by defendant. The consideration on 
 the part pf plaintiff was that he would furnish one cut a week and 
 copy of reading matter, both such as he might think best to advertise 
 defendant's grocery business. For that defendant agreed to pay 55 
 cents for each cut at the end of the quarter in which they were sent 
 We think the promise of each was a sufficient consideration for the 
 promise of the other, and that there was no lack of consideration on 
 either side. The fact that the contract provided that both the design 
 of the cut and the wording of the reading matter were to be such as 
 plaintiff might think best did not rfender the contract void. Plaintiff 
 was in the advertising business, making a specialty of furnishing this 
 kind of cuts and of reading matter to accompany' the same, and, if de- 
 fendant saw fit to make a contract to take cuts and reading matter for 
 a year and to leave the design of the cuts 'and the wording of the read- 
 ing matter to plaintiff's judgment, that was defendant's own concern. 
 It may have been a departure in advertising for a business man in the 
 city of York. It may have been an experiment, so to speak, but many 
 a business man has greatly improved his business by departing from 
 the beaten path. Such departure has often led to fortune; and the 
 fact that defendant saw fit to make such a departure in the preseni: 
 case cannot be imputed to plaintiff as fraud. The fact that, if plaintxli 
 failed to send the cuts and reading matter as agreed, defendant might 
 
60 OFFEE AND ACCRPTANCE (Ch. 1 
 
 have some difficulty in iiialcing proof of his damages sustained by rea- 
 si;n thereof, will not avoid the contract. 
 
 Many such cases arise, but we are not aware that it has ever been 
 held that for such a reason alone a contract will be held void. The con- 
 tract is fair upon its face, was entered into by defendant without undue 
 influence on plaintiff's part, was subsequently recognized by defendant 
 for more than four months by the receipt of the cuts without com- 
 plaint, and by payment therefor. Plaintiff was at all times ready to 
 perform his part of the contract, and we are unable to discover from 
 the record before us any good reason why defendant should not re- 
 spond in damages for his refusal to perform his part. * * * 
 
 Plaintiff also testified that he received notice from the postal author- 
 ities about April 12, 1906, that defendant was refusing to take the cuts 
 from the office, and that at that time he had expended all that was 
 necessary to expend to fill the order for the entire year, except the 
 sum of $3.60, and that therefore the difference between this $3.60 and 
 the contract price for the full year would be the amount of plaintiff's 
 damage for defendant's breach of the contract. This would seem to 
 be a fair adjustment of the difference between the parties, and we 
 think that, under the evidence in the record before us, plaintiff should 
 have recovered that amount. 
 
 The judgment of the district court is therefore reversed, and the 
 case remanded for further proceedings. 
 
 Reversed and remanded. 
 
 SECTION 5.— WHEN NOTICE OF ACCEPTANCE IS RE- 
 QUIRED 
 
 ANONYMOUS. 
 (In the Court of Common Pleas, 1478. Y. B. 17 Edw. IV, 2.) 
 
 In trespass for entering the close and taking and carrying away 
 grain, barley and grass.^' 
 
 Catesby [for defendant]. No action lies, because a long time before 
 the alleged trespass the plaintiff and the defendant bargained at a cer- 
 tain place in London, that the defendant should go to the place where, 
 etc., and there look at the said grain, barley and grass and if he was 
 pleased with what he saw that he should th_n take the said grain, bar- 
 ley, and grass, paying to the said plaintiff 3s. 4d. for each acre, one 
 with another. And we say that we went there and looked at them as 
 aforesaid, and were well content with the bargain, wherefore we took 
 the goods, which is the alleged trespass. We therefore pray judg- 
 ment, etc. 
 
 8 8 Parts of the report are omitted. 
 
Sec. 5) WHEN NOTICE OP ACCEPTANCE IS REQUIRED 61 
 
 Pigot [for plaintiff]. ^This is not a good plea for several reasons. 
 One is that he has said that the place, etc. is 10 acres of grain, etc. 
 Whereas he ought to have said 10 acres of land sown with grain, etc. 
 Also he has confessed the taking and has not shown that he paid us 
 the money according to the bargain, for I believe that it was not per- 
 mitted to him to take the goods before making payment, for it would 
 be very mischievous law that would let him have them without pay- 
 ing, etc. Also as to his having seen the grain, etc. he ought to have 
 notified us whether or not he was pleased with it, so that we might 
 know that he took it for that reason, for it could not be a completed 
 bargain if it does not appear that each party is agreed, etc. 
 
 Catesby [for defendant]. The plea is good enough in spite of all 
 the reasons he has given. As to the first matter, that we have said 
 acres of grain, etc. and not of land, etc. this is in accordance with 
 common usage (vulgariter). As to the second, that we have not alleg- 
 ed payment of the money, I believe that many bargains in this realm 
 are void, if this be law. But I hold that it is lawful in the case of 
 such a bargain for him to take the goods before making payment: 
 there is no mischief in that, for the plaintiff would have an action of 
 debt for the money, because we have received the thing, wherefore, 
 etc. And to my mind in such bargains the law is that the one puts his 
 trust in the other to have the thing for which they bargained, and so 
 should the other also. And on the point that we ought to notify him 
 of our agreement, this would be too inconvenient, to have to come back 
 here to tell him tjiat we are satisfied with the looks of the thing (which" 
 is perhaps in another country a long way from London). Also the 
 bargain shows in itself that thisns not necessary, in that he made his as- 
 sent depend on our assent, i. e. that if we were satisfied on inspection 
 of the goods we should have them, by reason of which he cannot be 
 better notified than he is by our taking, etc. 
 
 Littleton, [J.] As to the payment, it seems to me that he should 
 allege this or the plea is not good. E. g. if I go to a draper and ask 
 him how much I must pay for a certain piece of cloth, and he replies a 
 certain sum, and I say that I will take it ; whereupon I take the cloth, 
 but without paying him any cash in hand: he would have an action 
 of trespass against me, and it would be no defense to say that I had 
 bought it of him, without showing that I had paid him, etc. So here, 
 
 Choke, [J.] agreed, for a contract is not perfected without the 
 agreement of each party, quia dicitur de con, quod est simul : for if 
 you ask me in Smithfield how much you should give me for my horse, 
 and I say so much, and you reply that you will take him but you do 
 not pay the price, do you believe that it is my will that for this only 
 you are to have the horse without paying over the price? I say no, 
 and that I may still sell him to another, and you would have no reme- 
 dy against me, for otherwise I should be compelled to keep the horse 
 even agains^ my will, if the property be in you, and you could come 
 
62 OFFER AND ACCEPTANCE (Ch. 1 
 
 and take him whenever you pleased, which would be unreasonable. So 
 here. 
 
 Brian, [C. J.,] agreed, and it seems to me from the language of the 
 bargain that he is not permitted to enter and take the grain, for it can- 
 not be meant that he was willing that the defendant might have the 
 grain without paying the price. But if he had said take the grain and 
 pay when you please, or if he had specified a certain period of credit, 
 then I think he might have taken the grain and that a plea like the 
 present one would be good. * * * As to the other point, it seems 
 to me the plea is not good without alleging that he had notified the 
 other of his assent, for it is common knowledge that the mental as- 
 sent of a man cannot be determined by evidence, for the devil himself 
 does not know the mere thoughts of men. If, however, the agreement 
 had been that if the bargain should please you then you should so ex- 
 press yourself to a certain third person, I grant you that you would 
 not need to do more, for that would be a matter of fact [and capable 
 of proof]. Suppose I am bound to you in a penal bond for the sum 
 of £10 payable several days later, upon condition to be void in case 
 you are pleased to take a certain horse of mine in satisfaction of a 
 wrong that I have done you, etc., and you look at the horse but do 
 not tell me whether he pleases you or not, for which reason I do not 
 pay the £10, would the obligation be forfeit? I think not. Where- 
 fore, etc. 
 
 Catesby [for defendant]. Sir, if he does not take the horse, so that 
 his act indicates his assent, then you forfeit your obligation. And as 
 to the statement that there is no duty to deliver the thing sold before 
 payment of the, price, it is equally trjie that there is no duty to pay 
 the price before delivery of the thing sold. However, as I have said 
 before, by both law and reason, each must put confidence in the other ; 
 and if payment be regarded as necessary, I believe that we should 
 have seen decisions upon the point in our books, but I have never seen 
 any. * * * 
 
 WHITE v. CORLIES. 
 
 (Court of Appeals of New York, 1871. 46 N. T. 467.) 
 
 Appeal from First Judicial District. 
 
 The action was for an alleged breach of contract. 
 
 The plaintiff was a builder with his place of business in 'Fortieth 
 street. New York City. 
 
 The defendants were merchants at 32 Dey street. 
 
 In September, 1865, the defendants furnished the plaintiff with spec- 
 ifications, for fitting up a suit of offices at 57 Broadway, and request- 
 ed him to make an estifenate of the cost of doing the work. 
 
 On September 28th the plaintiff left his estimate with the defend- 
 ants, and they were to consider upon it, and inform the plaintiff of 
 their conclusions. 
 
Sec. 5) WHEN NOTICE OP ACCEPTANCE IS REQUIRED 63 
 
 ^ On the same day the defendants made a change in their specifica- 
 tions and sent a copy of the same, so changed, to the plaintiff, for his 
 assent under his estimate which he assented to by signing the same and 
 returning it to the defendants. 
 
 On the day following the^defendants' bookkeeper wrote the plaintiff 
 the following note: 
 
 "New York, September 29th. Upon an agreement to finish the fit- 
 ting up of offices 57 Broadway in two weeks from date you can begin 
 at once. The writer will call again, probably between five "and six this 
 p. m. W. H. R., for J. W. Cprlies & Co., 32 Dey street." 
 
 No reply to this note was ever made by the plaintiff; and on the 
 next day the same was countermanded by a second note from the de- 
 fendants. 
 
 Immediately on receipt of the note of September 29th, and before 
 the countermand was forwarded, the plaintiff commenced a perform- 
 ance by the purchase of lumber and beginning work thereon. 
 
 And after receiving the countermand, the plaintiff brought this ac- 
 tion for damages for a breach of contract. 
 
 The court charged the jury aS' follows : "From the contents of this 
 note which the plaintiff received, was it his. duty to go down to Dey 
 street (meaning to give notice of assent) before commencmg the work. 
 In my opinion it was not. He had a right to act upon this note and 
 commence the job, and that was a binding contract between the par- 
 ties." 
 
 To this defendants excepted. 
 
 FoLGER, J. We do not think that the jury found, or that the testi- 
 mony shows that there was any agreement between the parties before 
 the written communication of the defendants of September 30 was re- 
 ceived by the plaintiff. This note did not make an agreement. It was 
 a proposition, and must have been accepted by the plaintiff before ei- 
 ther party was bound in contract to the other. The only overt action 
 which is claimed by the plaintiff as indicating on his part an acceptance 
 of the offer, was the purchase of the stuff necessary for, the work, and 
 commencing work- as we^ understand the testimony, upon that stuff. 
 
 We understand the rule to be that where an offer is made by one 
 party to another when they are not together, the acceptance of it by 
 that other must be manifested by some appropriate act. It does not 
 need that the acceptance shall come to the knowledge of the one mak- 
 ing the offer before he shall be bound. But though the manifestation 
 need not be, brought to his knowledge before he becomes bound, he is 
 not bound if that manifestation is not put in a proper way to be in the 
 usual course of events, in some reasonable time communicated to him. 
 Thus a letter received by mail containing a proposal may be answered 
 by letter by mail containing the acceptance. And in general as soon' 
 as the answering letter is mailed, the contract is concluded. Though 
 one party does not know of the acceptance, the manifestation thereof 
 is put in the propq,r way of reaching him. 
 
64 OFFER AND ACCEPTANCE (Ch. 1 
 
 In the case in hand the plaintiff determined to accept. But a men- 
 tal determination not indicated by speech, or put in course of indica- 
 tion 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 accept- 
 ance, become such because accompanied by an unevinced mental deter- 
 mination. Where the act uninterpreted by concurrent evidence of the 
 mental purpose accompanying it is as well referable to one state of facts 
 as another, it is no indication to the other party of an acceptance, and 
 does not ope'rate to hold him to his offer. 
 
 Conceding that the testimony shows that the plaintiff did resolve to 
 accept this offer, he did no act which indicated an acceptance of it to 
 the defendants. He, a carpenter and builder, purchased stuff for the 
 work. B{it it was stuff as fit for any other like work. He began 
 work upon the stuff, but as he would have doile for any other like 
 work. There was nothing in his thought formed but not uttered, or in 
 his acts that indicated or set in motion an indication to the defend- 
 ants of his acceptance of their offer, or which could necessarily result 
 therein. 
 
 But the charge of the learned judge was fairly to be understood by 
 the jury as laying down the rule to them, that the plaintiff need not in- 
 dicate to the defendants his acceptance of their offer; and that the 
 purchase of stuff and working on it after receiving the note, made a 
 binding contract between the parties. In this we think the learned 
 judge fell into error. 
 
 The judgment appealed from must be reversed and a new trial or- 
 dered, with costs to abide the event of the action. All concur, but 
 AtivE'N, J., not voting. 
 
 Judgment reversed, and new trial ordered." ° 
 
 CARLHvIv V. CARBOIvIC SMOKE BALL CO. 
 
 (Court of Appeal, 1892. [1893] 1 Q. B. 256.) 
 Appeal from' a decision of Hawkins, J. [1892] 2 Q. B. 484. 
 The defendants, who were the proprietors and vendors of a. medical 
 preparation called "The Carbolic Smoke Ball," inserted -in the Pall 
 Mall Gazette of November 13, 1891, arid in other newspapers, the fol- 
 lowing advertisement: 
 
 "ilOO reward will be paid by the Carbolic Smoke Ball Company to 
 any person who contracts the increasing epidemic influenza, colds, or 
 
 so In accord: Beckwith v. Oheever, 21 N. H. 41 (1850). 
 
 The sending of a notice is so generally looked upon as the final and opera- 
 tive act that votes and other acts prior to notice may not be operative. In 
 Powell V. Lee, 99 L. T. 284 (1908), the plaintiff had applied for a position ; the 
 defendant school board voted to appoint him, but reconsidered the vote before 
 any formal notice to him. It was held that there. was no contract. In re 
 London & Northern Bank, [1900] 1 Qh. 220, held that an applicant for shares 
 could revoke his offer after the company had voted to allot the shares to him 
 and had started a letter of notification by a messenger. ' 
 
Sec. 5) WHEN NOTICE OF ACCEPTANCE IS EEQUIEED 65 
 
 any disease caused by taking cold, after having used the ball three 
 times daily for two weeks according to the printed directions supplied 
 with each ball. ilOOO is deposited with the Alliance Bank, Regent 
 Street shewing our sincerity in the matter. 
 
 "During the last epidemic of influenza many thousand carbolic smoke 
 balls were sold as preventives against this disease, and in no ascer- 
 tained case was the disease contracted by those using the cai-bolic 
 smoke ball. 
 
 "One carbolic smoke ball will last a family several months, making 
 it the cheapest remedy in the world at the price, 10s., post free. The 
 ball can be refilled at a cost of 5s. Address, Carbolic Smoke Ball 
 Company, 27 Princes Street, Hanover Square, London." 
 
 The plaintiff, a lady, on the faith of this advertisement, bought one of 
 the balls at a chemist's and used it as directed, three times a day, from 
 November 20, 1891, ,to January 17, 1892, when she was attacked by 
 influenza. Hawkins, J., held that she was entitled to recover the 
 ilOO. The defendants appealed. 
 
 LiNDLEY, L,. J.*" * * * \yg must first consider whether this 
 was intended to be a promise at all, or whether it was a mere puff which 
 meant nothing. Was it a mere puff? My answer to that question is 
 "No," and I base my answer upon this passage: "£1000 is deposited 
 with the Alliance Bank, shewing our sincerity in the matter." Now, for 
 what was that money deposited or that statement made except to nega- 
 tive the suggestion that this was a mere puff and meant nothing at all ? 
 The deposit is called in aid by the advertiser as a proof of his sincerity 
 in the matter — ^that is, the sincerity of his promise to pay this £100 in 
 the event which he has specified. I say this for the purpose of giving 
 point to the observation that we are not inferring a promise; there is 
 the promise, as plain as words can make it. 
 
 Then it is contended that it is not binding. In the first place, it 
 is said that it is not made with anybody in particular. ' Now that point 
 is common to the words of this advertisement and to the words of all 
 other advertisements oflFering rewards. They are offers to anybody 
 who performs the conditions named in the advertisement, and any- 
 body who does perform the condition iaccepts the offer. In point of 
 law this advertisement is an offer to pay £100 to anybody who will perr 
 form these conditions, and the performance of the conditions, is the ac- 
 ceptance of the offer. That rests upon a string of authorities, the 
 earliest of which is Williams v. Carwardine, 4 Bam. & Adol. 621, which 
 has been followed by many other decisions upon advertisements offer- 
 ing rewards. 
 
 But then it is said, "Supposing that the performance of the conditions 
 is an acceptance of the offer, that acceptance ought to have been no- 
 tified." Unquestionably, as a general proposition, when an offer is 
 
 40 Parts of the opinions are omitted, and so, also, is the entire opinion of 
 Smith, L. J. 
 
 OOBBIN CONT. — 5 
 
66 OFFER AND ACCEPTANCE (Ch. 1 
 
 made, it is necessary in order to make a binding contract, not only 
 that it should be accepted, but that the acceptance shouM b^ notified. 
 But is that so in cases of this kind? I apprehend that they are an ex- 
 ception to that rule, or, if not an exception, they are open to the obser- 
 vation that the notification of the acceptance need not precede the per- 
 formance. This offer is a continuing offer. It was never revoked, and 
 if notice of acceptance is required, — which I doubt very much, for I 
 rather think the true view is that which was expressed and explained 
 by Lord Blackburn in the case of Brogden v. Railway Co., 2 App. Cas. 
 666, 691,-^if notice of acceptance is required, the person who makes 
 the offer gets the notice of acceptance contemporaneously with his no- 
 tice of the performance of the condition. If he gets notice of the 
 acceptance before his offer is revoked,; that in principle is all you want. 
 I, however, think that the true view, in a case of this kind, is that the 
 person who makes the offer shows by his language and from the nature 
 of the transaction that he does not expect and does not require notice 
 of the acceptance apart from notice of the performance. * * * 
 
 I 'come now to the last point which I think requires attention : that 
 is, the consideration. It has been argued that this is nudum pactum — 
 that there is no consideration. We must apply to that argument the 
 usual legal tests. Let us see whether there is no advantage to the de- 
 fendants. It is said that the use of the ball is no advantage to them, 
 and that what benefits them is the sale; and the case is put that a lot 
 of these balls might be stolen, and that it would be no a.dvantage to the 
 defendants if thcthief or other people used them. The answer to that, 
 I think, is as follows: It is quite obvious that in view of the adver- 
 tisers a use by the public of their remedy, if they can only get the pub- 
 lic to have confidence enough to use it, will react and produce a sale 
 which is directly beneficial to them. Therefore, the advertisers get out 
 of the use an advantage which is enough to constitute a consideration. 
 
 But there is another view. Does not the person who acts upon 
 this advertisement and accepts the offer put himself to some incon- 
 venience at the request of the defendants ? Is it nothing to use this ball 
 three times daily for two weeks according to the directions at the re- 
 quest of the advertiser? Is that to go for nothing? It appears to me 
 that there is a distinct inconvenience, not to say a detriment,, to any 
 person who so uses the smoke ball. I am of opinion, therefore, that 
 there is ample consideration for the promise. * * * 
 
 BowEN, L. J. * * * Then it was said that there was no notifica- 
 tion of the acceptance of the contract. One cannot doubt that, as an 
 ordinary rule of law, an aicepance of an offer made ought to be 
 notified to the person who makes the offer, in order that the two minds 
 may come together. Unless this is done, the two minds may be apart, 
 and there is not that consensus which is necessary according to the 
 English law — I say nothing about the laws of other countries — to make 
 a contract. But there is this clear gloss to be made upon thiat doctrine, 
 that as notification of acceptance is required for the benefit of the 
 
Sec. 5) WHEN NOTICE OP ACCEPTANCE IS REQUIRED 67 
 
 person who makes the offer, the person who makes the offer may dis- 
 pense with notice to himself if he thinks it desirable to do so, and I 
 suppose there can be no doubt that where a person in an offer made by 
 him to another person, expressly or inipliedly intimates a particular 
 mode of acceptance as sufficient to make the bargain binding, it is only 
 necessary for the other person to whom such offer is made to follow 
 the indicated method of acceptance ; and if the person making the of- 
 fer, expressly or impliedly intimates in his offer that it will be sufficient 
 to act on the proposal without communicating acceptance of it to him- 
 self, performance of the condition is a sufficient acceptance without 
 notification. 
 
 That seems to me to be the principle which lies at the bottom of the 
 acceptance cases, of which two instances are the well-known judgment 
 of Hellish, L. J., in Harris's Case, L. R, 7 Ch. 587, and the very in- 
 structive judgrnent of Lord Blackburn in Brogden v. Railway Co., 2 
 App. Cas. 666, 691, in which he appears to me to take exactly the line I 
 have indicated. 
 
 Now, if that is the law, how are we to find out whether the person 
 who makes the offei; does intimate that notification of acceptance will 
 not be necessary in order to constitute a binding bargain? In msmy 
 cases you look to the offer itself. In many cases you extract from the 
 character of the transaction that notification is not required, and in the 
 advertisement cases it seems to me to follow as an inference to be 
 drawn from the transaction itself that a person is not to notify his 
 acceptance of the offer before he performs the condition, but that if 
 he performs the condition notification is dispensed with. It seems 
 to me that from the point of view of common sense no other idea 
 could be entertained. If I advertise to the world that my dog is lost, 
 and that anybody who brings the dog to a particular plape will be paid 
 some money, are all the police or other persons whose business it is to 
 find lost dogs to be expected to sit down and write a note saying that 
 they have accepted my proposal? Why, of course, they at once look 
 after the dog, and as soon as they find the dog they have performed 
 the condition. The essence of the transaction is that the dog should be 
 found, and it is not necessary under such circumstances, as it seems 
 to me, that in order to make the contract binding there should be any 
 notification of acceptance. It follows from the nature of the thing that 
 the performance of the condition is sufficient acceptance without the 
 notification of it, and a person who makes an offer in an advertisement 
 of that kind makes an offer which must be read by the light of that 
 common sense reflection. He does, therefore, in his offer impliedly in- 
 dicate that he does not require notification of the acceptance of the 
 offer. * * * 
 
 Appeal dismissed.*^ 
 
 41 In Weaver v. Wood, 9 Pa. 220 (1848), Gibson, C. J., said: "If a party 
 promise another a definite or a reasonable reward if lie will do a particular 
 thing, the party promised is not bound to do it; yet if he does it without 
 
68 OFFER AND ACCEPTANCE (Ch. 1 
 
 HALLOCK V. COMMERCIAL INS. CO. 
 (Supreme Court of New Jersey, 185T. 26 N. J. Law, 268.) 
 
 VrEdEnburgh, J.*'' G. W. Breck was the agent of the defendants at 
 Bath, New York, to make surveys, receive proposals for insurance, 
 and receive premiums on risks accepted by the company, but was not 
 authorized to make insurances or issue policies. The proposals for in- 
 surance were sent by him to the company at Jersey City, and if accept- 
 ed by them, the policies were to be sent to him to deliver. 
 
 On the 2d of March, 1855, the plaintiff applied to him to insure his 
 building in Bath, for one year from the 10th of March, for $1,200. 
 Breck made the survey, and told him what the premium would be. 
 The plaintiff thereupon offered the premium to Breck, who said he 
 would consider it as paid, but would leave it with the plaintiff, who 
 was a banker, and with whom he kept his account, until the policy ar- 
 rived, when he would call and get the money. The application was 
 signed by the plaintiff, and with the survey attached, was sent by Breck 
 to the company, on the 2d or 3d of March. The defe^dants deferred 
 acting on the application until the secretary could procure a map of 
 Bath, referred to by Breck. 
 
 On the 13th of March, between 10 and 12 a. m., the map having been 
 received, a policy was filled up on said building, insuring it from the 
 10th of March for one year, signed by the proper officers, and mailed 
 at Jersey City, directed to Breck at 'Bath, which by due course of mail 
 would have reached him on the 14th March, but which, owing to the 
 snow, did not until the 16th of March. At the same time that Breck 
 received the policy he also received a telegraphic despatch, dated the 
 15th March, as follows: "Risk not taken when burnt. Return policy 
 when received." 
 
 Accompanying the policy was also a letter from the secretary, of the 
 tenor following: 
 
 "Office of the Commercial Insurance Company, No. 3. _ 
 
 "Montgomery St., Jersey City, March 13th, 1855. 
 "Messrs. Breck and Sawyer, Esq'rs, Bath, N. Y. 
 
 "Dear Sirs : Your application on G. W. Hallock's saloon has been 
 held under advisement till we could procure a copy of the map, of 
 which you speak in your letter. We do not look on it as a very desir- 
 
 more, lie entitles himself to the reward. On the other hand, the promisor 
 may retract before performance." See, also, Patton's Ex'r v. Hassinger, 69 
 Pa. 311 (1871), promise to pay any one who would take care of John; fieif 
 V. Paige, 65 Wis. 496, 13 N. W. 473, 42 Am. Rep. 731 (1882), promise of reward 
 for rescue of person from a fire. 
 
 Where an ofCer is made to buy goods on certain terms, to be shipped, the 
 shipment, without more, may be a sufficient acceptance. Sturdivant v. Mt. 
 Dixie Sanitarium, Land & Investment Co., 197 Ala. 280, 72 South. 502 (1916). 
 
 *2 The statement of facts, some portions of the opinion and the concurring 
 opinion of Potts, J., have been omitted. 
 
Sec. 5) WHEN NOTICE OP ACCEPTANCE IS REQUIRED 6.9 
 
 able risk, but nevertheless, as the rate seems a fair one, we enclose a 
 policy, relying very much on your representation in regard to the good 
 character of the occupant. Enclosed please find policy, No. 1054, for 
 $1,200, premium $24. 
 
 "Respectfully, J. M. Chapman, Sec'y." 
 
 On the 16th of March, aitter the policy arrived, the plaintiff tender- 
 ed the premium in gold to Breck, and demanded the policy. Breck ac- 
 cepted the money, because he had refused to accept it when the appli- 
 cation was made, and considered it on deposit, meaning to put the 
 plaintiff in the same situation as if he had received it on the 2d of 
 March, but refused to deliver the policy, because so directed by the 
 defendants. 
 
 The building insured was entirely consumed by fire on the 13th of 
 March, at 8. a. m., about two hours before the risk was accepted or 
 the policy signed. * * * The suit is on the policy, and the plea 
 the general issue. * * * 
 
 Secondly. The defendants insist that the application, having been 
 made on the 2d of March, and no action having been taken by the de- 
 fendants until the 13th, we cannot consider the plaintiff as still con- 
 tinuing his offer to the defendants; that we are bound to consider it 
 as withdrawn. But why so? There is no pretence of any express 
 withdrawal. The question and the answer can never, in any case, be 
 simultaneous; the question must always remain for some length of 
 time with the one to whom it is put, and abide the answer. In every 
 negotiation, whether by telegraph, by letter, or by word of mouth, the 
 application and the answer can never be at the same precise instant. 
 The application must wait upon the answer. If the application is con- 
 sidered to be withdrawn as soon as made, no two minds ever could 
 meet upon any proposition. The aggregatio mentiura never could take 
 place. In all cases, the application is construed to stand until the con- 
 trary appears; until it is either withdrawn or answered. Ppthier 
 Traite du Contrat du vente, p. 1, § 2, art. 3, No. 32 ; MaCtier v. Frith, 
 6 Wend. (N. Y.) 103, 21 Am. Dec. 262. . 
 
 But here the plaintiff avers the application to be still standing. The 
 defendants treat it as still before them on the 13th of March, by ac- 
 cepting it, and making out the policy We must therefore- treat it as 
 the parties treat it, as still at noon on the 13th of March a standing 
 and valid offer by the plaintiff to the defendants.*^ 
 
 Thirdly. The defendants contend that the policy never was deliver- 
 ed, so as to make it a living contract. But it appears, by the case, that 
 the contract to insure was complete before they mailed the policy to 
 Breck. Their telegraphic despatch, dated on the 15th of March, says 
 "risk not taken when burnt ; return policy when received." This nee 
 esearily implies that the risk was taken, but taken after the fire. Breck 
 had no authority to insure. After the proposals were accepted by the 
 
 *3 As to this point, see post, p. 141, Duration of the Power of Acceptance. 
 
70 OFFER AND ACCEPTANCE (Ch. 1 
 
 company, they made out the policies, and sent them to Breck to deliv- 
 er; so that it appears, by the case, that before they mailed the policy 
 to Breck, they must have received the premium and accepted the risk, 
 and thus completed the contract to insure. If the case had gone no 
 further, and no policy had ever been made out, it is well settled that 
 the plaintiff could have sued theni upon this contract at law or forced 
 from them a policy in equity. Perkins v. Washington Ins. Co'., 4 Cow. 
 (N. Y.) 660; Hamilton v. Lycoming Ins. Co., 5 Pa. 339; Angell on 
 Fire Ins. §§ 34, 47; Union Mutual v. Commercial Mutual (March, 
 1856) 18 Law Rep. 610, Fed. Cas. No. 14,372. 
 
 Under these circumstances, a policy drawn up and signed by the 
 proper officers wants no further delivery. It is a vital policy as soon 
 as signed, becomes instantly the property of the insured, and is held 
 by the insurer for his use. Ang. on Fire Ins. § 33, 31; Pim v. Reed, 
 6 Man. & Grang. 1 ; Kohne v. Insurance Co., 1 Wash. C. C. 93, Fed. 
 Cas. No. 7,920. 
 
 But here were further" acts of delivery of the policy. It was, on the 
 13th of March, mailed and sent to Breck, to deliver to the plaintiff. 
 This was sending it to the plaintiff by Breck. Breck and the mail 
 were only the vehicles to carry it to him. It was the same thing as if 
 mailed or sent directly to the plaintiff. The defendants suggest, in an- 
 swer, that Breck was their agent, and that, by sending it to him, they 
 did not part with the possession of the policy, and that they only gave 
 authority to Breck to deliver, which they could and did revoke before 
 actual delivery. But when they mailed the policy to Breck to deliver, 
 they did not constitute him their agent, to receive or keep it for them, 
 nor to retain it as their agent. He was, in that regard, no agent of 
 theirs; he had nothing further to do for them. By sending him the 
 policy to deliver, they made Breck trustee for the plaintiff ; they made 
 it a deposit with Breck to the credit of the plaintiff. It was a delivery 
 to Breck to deliver to the plaintiff, which was a good delivery to the 
 plaintiff. Shep. Touch. 58. This is not a question of the authority or 
 acts of an agent; but whether the defendants, by sending the policy to 
 Breck to deliver, did an overt act intended to signify that the policy 
 should have a present vitality. This certainly was such an act. With- 
 out any further interference on their part, it would have resulted in 
 actual delivery to the plaintiff. It was intended to signify to the plain- 
 tiff not only that the policy was a present contract, but to effect an ac- 
 tual delivery of it to him.** Kentucky Mutual Ins. Co. v. Jenks, 5 Ind. 
 96; Hamilton v. Lycoming Ins. Co., 5 Pa. 339; Tayloe v. Merchants 
 Fire Ins. Co., 9 How. 390, 13 L. Ed. 187. 
 
 Suppose the defendants had retained the policy, and had njerely told 
 Bteck to tell the plaintiff that they held the policy subject to the plain- 
 tiff's order, would they not have been deemed as holding the policy tfor 
 the plaintiff ? 
 
 'i* As to what constitutes delivery of a sealed instrument, see post, p. 464. 
 
Sec. 5) WHEN NOTICE OF ACCEPTANCE IS REQUIRED 71 
 
 The defendants next suggest that the plaintiff was ignorant of their 
 acceptance of the risk, of their making out and mailing the policy to 
 Breck until after they had countermanded its delivery, and that the 
 aggregatio mentium could not take place until after the acceptance of 
 the proposition by the defendants came to the plaintiff's knowledge, 
 and that before that, the defendants had changed their own minds, so 
 that in fact it never did take place, and that consequently there was no 
 legal delivery of this policy. 
 
 This involves the more general question, does a contract arise when 
 an overt act is done intended to signify the acceptance of a specific 
 proposition, or not until that overt act comes to the knowledge of the 
 proposer ? This question may arise upon every mode of negotiating a 
 contract, whether the parties be in each other's presence or not. Fir^ 
 comes the mental resolve to accept the proposition; but the law can 
 only recognize an overt act. Whether that act be a word spoken, a 
 telegraphic sign, or a letter mailed, some interval of time, more or 
 less appreciable, must intervene between the doing of the act and its 
 coming to the knowledge of the party to whom it is addressed. In the 
 mean time, what is the condition of affairs? Is it a contract or no 
 contract ? If the bidder does not see the auctioneer's hammer fall ; if 
 the article written for and sent never arrives; if the verbal answer, 
 when the parties are in each other's presence, is in a foreign tongue, or 
 by sudden noise or distraction is riot heard; if the telegraphic circuit 
 is broken; if the mail miscarries; if the word spoken or the letter 
 sent is overtaken, and countermanded by the electric current, is there 
 no contract? In the progress of the negotiation, at what precise point 
 of time does mind meet mind, does the contract spring into life? 
 
 Upon this subject, with respect to negotiations conducted by. writ- 
 ten communications, there has been some variety of decision, but it 
 appears to me that the weight of authority, as well as reason and ne- 
 cessity, admit of but one solution. 
 
 The meeting of two minds, the aggregatio mentium necessary to the 
 constitution of every contract, must take place eo instanti with the 
 doing of any overt act intended to signify to the other party the accept- 
 ance of the proposition, without regard to when that act comes to the 
 knowledge of the other party; everything else must be question of 
 proof or of the binding force of the contract by matters subsequent. 
 The overt act may be as various as the form and nature of contracts. 
 It may be by the fall of the hammer, by words spoken, by letter, by 
 telegraph, by remitting the article sent for, by mutual signing or by de- 
 livery of the paper, and the delivery may be by any act intended to sig- 
 nify that the instrument shall have a present vitality. Whatever the 
 form, the act done is the irrevocable evidence of the aggregatio nien- 
 tium ; at that instant the bargain is struck. The acceptor can no more 
 overtake and countermand by telegraph, his letter mailed, than he can 
 his words of acceptance after they have issued from his lips on their 
 
72 OFFER AND ACCEPTANCE (Ch. 1 
 
 way to the hearer.'"' If the two minds do not meet eo instant! with 
 the act signifying acceptance, when can they, in the nature of things, 
 ever approach each other more closely? The defendants say, when 
 the act of acceptance comes to the knowledge of the other party. But 
 this knowledge would be a fact without any force, unless we suppose 
 in the proposer a power still of electing not to accept the acceptance. 
 But if we do this, it is apparent that the negotiation is yet precisely in 
 the same stage of development it was in when the first proposition was 
 waiting upon the first answer. The notion that there is no contract 
 until the acceptance comes to the knowledge of the other party, pro- 
 ceeds upon the ground, in the first place, that the proposal has been 
 withdrawn or lost its force, which is against the intent of the parties 
 and the necessities of the case; and in the second place, upon the 
 ground that the answer is conditional, whereas> we suppose it to be ab- 
 solute. We suppose the acceptor to say not simply I agree, but to say 
 I agree if you do, which requires an answer from the proposer; so 
 that theiminds do not meet till he answers. But in the mean time the 
 acceptor may have changed his mind, and for the same reason as be- 
 fore, there is no bargain until this last answer comes to the knowledge 
 of the other party ; and so, upon this theory, it must go on ad infinitum 
 without the possibility of the aggregatio mentium ever taking place. 
 There is in fact no difference between the acceptance of a proposition 
 by word of mouth and a letter stating an acceptance. In the one case 
 it is articulate sounds carried by the air, in the other, written signs 
 carried by the mail or by telegraph. The vital question is, was the in- 
 tention manifested by any overt act, not by what kind of messerlger it 
 
 45 The French courts say there Is still a power to countermand. In S- 
 
 V. F , Merlin, R6p. de Jur. (1813) tit. Vente, 1, art. Ill, No. XI bis, the 
 
 court said: "A man has in his cabinet an acoustic vault, constructed in such 
 a manner that, by reason ot the various and extremely multiplied windings 
 of the tubes which compose it, the words transmitted through one of the ex- 
 tremities do not reach the other till after a space of five minutes. I am in 
 the presence of that man, and in his cabinet in question. There, after saying 
 to me: Will you buy of me such a thing for such a sum? he adds: Answer 
 me by my acoustic vault. Thereupon we take our places, I at one of the 
 extremities of his vault, he at the other and I say to him by this speaking 
 trumpet: I will. But a minute after I change my resolution; I run to him, 
 and before he has been able to hear my answer, I say to him: I will not. 
 Could he, after having heard the answer which I made to him at first by his 
 acoustic vault, pretend that this answer having been transmitted to him by 
 tubes of which he was proprietor, and having consequently become his proj)- 
 erty at the very instant that It left my mouth, I could not retract it before 
 it had struck his ear? No, emphatically no; a hundred times no!" From 
 Langdell's Cases on Contracts. 
 
 To the same effect is In re Bouton, Journal du Palais (1902), II, 174. But 
 see Aubry et Rau (4th Ed.) t. 4, 294, 295, § 343 ; Baudry-Lacantineri'e et Barde, 
 Des Oblig. (2d Ed.) t. 1, n. 37. 
 
 The following rule appears to be reasonable and just, although not sup- 
 ported as to the second part by any judicial decisions: The offeror's power 
 o(f revocatioh is extinguished as soon as the offeree has performed a requested 
 or otherwise reasonable act of acceptance ; the offeree has the power of rev- 
 ocation until, and only until, the offeror learns that the act of acceptance has 
 been performed. 
 
Sec. 5) WHEN NOTICK OF ACCEPTANCE IS REQUIRED 73' 
 
 was sent. The bargain, if ever struck at all, must be eo instanti with 
 such overt act. Mailing a letter containing an acceptance, or the in- 
 strument itself intended for the other party, is certainly such an act? 
 Adams v. Lindsell, 1' B. & Aid. 681 ; Dunlop v. Higgins, 1 H. L. C. 
 381 ; Duncan v. Topham, 8 C. B. 225 ; Potter v. Saunders, 6 Hare, 1 ; 
 Tayloe v. Merchants' Ins. Co., 9 How. 390, 13 L. Ed. 187 ; Hamilton 
 V. Lycoming Ins. Co., S Pa. 339; Vassar v. Camp, 14 Barb. (N. Y.) 
 341 ; Mactier v. Frith, 6 Wend. (N. Y.) 103, 21 Am. Dec. 262; Ken- 
 tucky Mutual V. Jenks, 5 Ind. 96. This last case, in all its essential 
 features is identical with the one before us. . , 
 
 The only English case sustaining the defendants iij their view, that I 
 have seen, is that of Cooke v.. Oxley, 3 Term R. 653, which it will be 
 perceived, by the above references, has been effectually overruled in 
 tlieir courts. 
 
 In the state of New York, the case of Frith y. Lawrence, 1 Paige,, 
 434, was reversed in their Court of Errors by a very large vote. Mac- 
 tier v. Frith, 6 Wend. Ill, 21 Am. Dec. 262, and the doctrine sustain- 
 ed as contended for by the plaintiff. 
 
 The only other American case On this side of the question is that of 
 McCulloch,v. Eagle Ins.. Co., 1 Pick. (Mass.) 278. This last is against 
 the whole current of authorities both in England and in this country, 
 and appears to me requires for the creation of a contract a fact with- 
 out significance, or a condition that would render its creation impossi- 
 ble. , 
 
 Let judgment be entered on the verdict for the plaintifiE. 
 
 BISHOP V. EATON. 
 
 (Supreme Judicial Court of Massachusetts, 1894. 161 Mass. 496, 37 N. E. 665, 
 
 42 Am. St. Rep. 437.) 
 
 Contract, on a guaranty. .Writ dated February 2d, 1892. Trial in 
 the Superior Court without a jury, before Braley, J., who found the 
 following facts : 
 
 The plaintiff in 1886 was a resident of Sycamore in the State of 
 Illinois, and was to some extent connected in business with Harry H. 
 Eaton, a brother of the defendant. In December, 1886, the defend- 
 ant in a letter to the plairitiff- said, "If Harry needs more money, let 
 him have it, or assist him to get it, and I will see that it is paid." 
 
 On January 7th, 1887, Harry Eaton gave his promissory note for 
 two hundred dollars to one Stark, payable in one year. The plaintiff 
 signed the note as surety, , relying on the letter of the defendant, and 
 looked to the defendant solely ior reimbursement, if called upon to 
 pay the note. Shortly afterward the plaintiff wrote to the defendant 
 a letter stating that the note had been given and its amount, and 
 deposited the letter in the mail at Sycamore, .postage prepaid, and 
 properly addressed to the defendant at his home in Nova Scotia. 
 
74 OFFER AND ACCEPTANCE (Ch. 1 
 
 The letter, according to the testimony of the defendant, was never 
 received by him. At the maturity of the note the time for its pay- 
 ment was extended for a year, but whether with the knowledge or 
 consent of the defendant was in dispute. In August, 1889, in an 
 interview between them, the plaintiff asked -the defendant to take 
 up the note still outstanding, and pay it, to which the defendant replied : 
 "Try to get Harry to pay it. If he don't, I will. It shall not cost you 
 anything." 
 
 On October 1st, 1891, the plaintiff paid the note, and thereafter 
 made no effort to collect it from Harry Eaton; the maker. The de- 
 fendant testified that he had no notice of the payment of the note 
 by the plaintiff until December 22d, 1891. ' 
 
 The defendant requested the judge to rule: 1. The letter of the 
 defendant constituted in law no more than an offer of guaranty. 
 2. The defendant did not become bound by a contract of guaranty 
 unless it appeared from a preponderance of the evidence that, within 
 a reasonable time after his offer was accepted and acted upon, he 
 had notice of such acceptance, and the giving of credit thereon. 3. The 
 mere deposit in the mail of a letter accepting an offer of guaranty 
 which has been made by mail, such letteir being properly stamped 
 and addressed to the: party making the offer, and mailed within a 
 reasonable time after the acceptance, does not in law constitute such 
 notice to the latter as thereupon to bind him. 4. The defendant did 
 not become bound by a contract of guaranty, if at all, unless he ac- 
 tually received such letter of acceptance. 5. A delay for two years 
 and a half after accepting and acting upon an offer of guaranty to 
 give notice to the person making the offer is an unreasonable delay. 
 7. If for a year and a haH after the maturity of the note and the de- 
 fault of payment by the maker, the defendant had no notice of the 
 default, he was discharged from his contract unless he subsequently 
 waived his rights arising from the plaintiff's laches. 
 
 The judge declined so to rule, and ruled, as matter of law upon 
 the findings of fact, that the plaintiff was entitled to recover, and or- 
 dered judgment for him; and the defendant alleged exceptions.*® 
 
 Knowlton, J. * * * The defendant requested many rulings in 
 regard to the law applicable to contracts of guaranty, most of which 
 it becomes necessary to consider. The language relied on was an 
 offer to guarantee, which the plaintiff might or might not accept. With- 
 out acceptance of it there was no contract, because the offer was con- 
 ditional and there was no consideration for the promise. But this 
 was not a proposition which was to become a contract only upon the 
 giving of a promise for the promise, and it was not necessary that the 
 plaintiff should accept it in words, or promise to do anything before 
 acting upon it. It was an offer which was to become effective as a 
 contract upon the doing of the act referred to. It was an offer to be 
 
 <6 The statement of facts is abridged and parts of the opinion are omitted. 
 
Sec. 5) WHEN NOTICE OP ACCEPTANCE IS REQUIRED 75 
 
 bound in consideration of an act to be done, and in such a case the 
 doing of the act constitutes the acceptance of the offer and furnishes 
 the consideration. Ordinarily there is no occasion to notify the offerer 
 of the acceptance of such an -offer, for the doing of the act is a suffi- 
 cient acceptance, and the promisor knows that he is bound when he 
 sees that action has been taken on the faith of his offer. But if the 
 act is of such a kind that knowledge of it will not quickly come to the 
 promisor, the promisee is bound to give him notice of his acceptance 
 within a reasonable time after doing that which constitutes the ac- 
 ceptance. In such a case it is implied iri the offer that, to complete 
 the contract, notice shall be given with due diligence, so that the 
 promisor may know that a contract has been made. But where the 
 promise is in consideration of an act to be done, it becomes binding 
 upon the doing of the act so far that the promisee cannot be affected 
 by a subsequent withdrawal of it, if within a reasonable time after- 
 ward he notifies the promisor. In accordance with these principles, 
 it has been held in cases like the present, where the guarantor would 
 not know of himself, from the nature of the transaction, whether the 
 offer has been accepted or not, that he is not bound without notice of the 
 acceptance, seasonably given after the performance which constitutes 
 the consideration. Babcock v. Bryant, 12 Pick. 133 ; Whiting v. Stacy, 
 15 Gray, 270; ScUessinger v. Dickinson, 5 Allen, 47. / 
 
 In the present case the plaintiff seasonably mailed a letter to the 
 defendant, informing him of what he had done in compliance with 
 the defendant's request, but the defendant testified that he never re- 
 ceived it, and there is no finding that it ever reached him. The judge 
 ruled, as matter of law, that upon the facts found, the plaintiff was en- 
 titled to recover, and the question is thus presented whether the defend- 
 ant was bound by the acceptance when the letter was properly mailed, 
 although he never received it. 
 
 When an offer of- guaranty of this kind is made, the implication 'is 
 that notice of the act which constitutes an acceptance of it shall be 
 given in a reasonable way. What kind of a notice is required de- 
 pends upon the nature of the transaction, the situation of the parties, 
 and the inferences fairly to be drawn from their previous dealings, 
 if any, in regard to the matter. If they are so situated that com- 
 munication by letter is naturally to be expected, then the deposit of 
 a letter in the mail is all that is necessary. If that is done which is 
 fairly to be contemplated from their relations to the subject-matter 
 and from their course of dealing, the rights of the parties are fixed, 
 and a failure actually to receive the notice will not affect the, obliga- 
 tion of the guarantor. 
 
 The plaintiff in the case now before us resided in Illinois, and the 
 defendant in Nova Scotia. The offer was made by letter, and the 
 defendant must have contemplated that information in regard to the 
 plaintiff's acceptance or rejection of it would be by letter. It would 
 be a harsh rule which would subject the plaintiff to the risk of the 
 
76 OFFER AND ACCEPTANCE (Ch. 1 
 
 defendant's failure to receive the letter giving notice of his action 
 on the faith of the ofifer. We are of opinion that the plaintiff, after 
 assisting Harry to get the money, did all that he wras required to 
 do when he seasonably sent the defendant the letter by mail inform- 
 ing him of what had been done. 
 
 How far such considerations are applicable to the case of an ordinary 
 contract made by letter, about which some of the early decisions are 
 conflicting, we need not now consider. * * * 
 
 Exceptions sustained.*^ 
 
 47 There are many apparently conflicting cases as to whether a guarantor is 
 bound in the absence of any notice by the creditor. See Ames' Cases on 
 Suretyship, p. 225 et seq. 
 
 Offer iy Creator. — If the offer is made by the creditor to the surety, the 
 latter must usually give notice of his acceptance, because he is asked for a 
 promise ; but no further notice by the creditor is necessary. Stauffer v. Koch, 
 225 Mass. 525, 114 N. E. 750 (1917). It is often said that, when the guaranty 
 is given at the creditor's. request, the creditor need give no notice of accept- 
 ance. Peck V. Precision Mach. Co., 20 Ga. App. 429, 93 S. E. 106 (1917) ; Hi- 
 bernia Bank & Trust Co. v. Succession of Cancienne, 140 La. 969, 74 South. 
 267, li. R. A. 1917D, 402 (1917). Contra: Evans v. McCormick, 167 Pa. 247, 
 31 Atl. 563 (1895). 
 
 Offer hy Ouarantor. — (1^ Promise for Act. The offer by the guarantor must 
 of necessity be an offer oif a promise. He may request a non-promissory act 
 in return, (a) This act may be the giving of credit to the principal debtor. 
 The doing of this act (giving credit to M.) is the acceptance of the offer, and 
 no notice should be required. Lennox v. Murphy, 171 Mass. 370, 50 N. E. 644 
 (1898), "there is no universal doctrine of the common law that acceptance of 
 an offer must be communicated in order to make a valid simple contract" ; 
 Bishop V. Eaton, supra ; Powers v. Bumcratz, 12 Ohio St. 273 (1861) ; Ed- 
 dowes V. Niell, 4 Dall. (Pa.) 133, 1 L. Ed. 772 (1793) ; Siegel v. Baily, 252 Pa. 
 231, 97 Atl. 401 (1916). Contra: Davis Sewing Mach. Co. v. Richards, 115 
 U. S. 524, 6 Sup. Ct. 173, 29 L. Ed. 480 (1885) ; Great Western Mfg. Co. v. 
 Porter, 103 Kan. 84, 172 Pac. 1018 (1918) ; Balfour v. Knight, 86 Or. 165, 167 
 Pac. 484 (1917) ; Birmingham News Co. v. Read, 200 Ala. 655, 77 South. 29 
 (1917) ; Northern Nat. Bank v. Douglas, 135 Minn-. 81, 160 N. W. 193 (1916) ; 
 Mozley v. Tinkler (Excli.) 1 Cr., M. & R. 692 (1835). The guarantor's duty 
 to pay may still be subject to a constructive condition precedent that some 
 notice be given. This may be notice that the requested credit has been given, 
 or that the balance due is some spectflc amount, or that there has been de- 
 fault. See Bishop v. Eaton, supra; Black v. Grabow, 216 Mass. 516, 104 N. 
 E. 346, 52 L. R. A. (N. S.) 569 (1914) ; Davis Sewing Mach. Co. v. Richards, 
 115 TJ. S. 524, 6 Sup. Ct. 173, 29 L. Ed. 480 (1885) ; Evans v. McCormick 167 
 Pa. 247, 31 Atl. 563 (1895)": De Cremer v. Anderson, 113 Mich. 578, 71 N. W. 
 1090 (1897). Even before this notice, however, it is too late for the guarantor 
 to withdraw; he is bound by a conditional contract, (b) The act requested 
 may be the payment of money to the guarantor. The performance. of this act 
 involves notice perhaps ; certainly no other notice is required. Davis v Well's 
 104 tl. S. 159, 26 L. Ed. 686 (1881). 
 
 (2) Promise under Seal. The guaranty offered may be a sealed document. 
 In such case it is binding as soon as delivered to the creditor or his represen- 
 tative. No notice is necessary, except possibly as a condition precedent to 
 the secondary obligation, as explained above. See Davis v. Wells supra- 
 Powers V. Bumcratz, supra. ' ' 
 
 (3) Promise for a Promise. If the offer contemplates the undertaking of a 
 return duty by the creditor, thus empowering the latter to make only a bilat- 
 eral contract, a notice of acceptance will nearly always be necessai-y to the 
 formation, of a contract. 
 
Sec. 5) WHEN NOTICE OP ACCEPTANCE IS REQUIRED 77 
 
 WHEELER V. McSTAY et al. 
 
 (Supreme Court of Iowa, 1913. 160 Iowa, 745, 141 N. W. 404, L. R. A. 
 
 1915B, 181.) 
 
 Action in equity to enforce performance of contract for conveyance 
 of real estate. Petition dismissed, and plaintiff appeals. Reversed. 
 
 Weaver, C. J.** The case made by the plaintiff is substantially as 
 follows : Plaintiff being the owner of a quarter section of land in North 
 Dakota and a house and lot in^Waverly, Iowa, and the defendant F. E. 
 McStay being the owner of certain other real estate in Waterloo, Iowa, 
 said parties under date of January 25, 1911, at said city of Waterloo, 
 entered into a written agreement for the exchange or mutual transfer 
 of said properties on terms therein named, subject, however, to the 
 following stipulations: "The party of the second part is to have 30 
 days from date in which to examine the properties described above 
 as being owned by first party, and this contract is not to become binding 
 upon said second party until the expiration of said 30 days unless 
 such time is waived by said party. At the end of 30 days this contract 
 is to become binding upon said party unless he sooner notifies first 
 party, in writing, of his intention to abandon and cancel the same. 
 In case this contract becomes binding upon both parties hereto in 
 the manner above stated, then said parties are each to deliver to the 
 other good and sufficient warranty deeds to their respective properties, 
 and abstracts of title to the same showing clear and merchantable ti- 
 tle thereto, except, of course, the mortgages above referred to, which 
 are liens against the North Dakota property conveyed by first party and 
 the Waterloo property conveyed by second party. Deeds and abstracts 
 to be exchanged within a reasonable time after this contract becomes 
 binding on both parties hereto." 
 
 The making of the alleged agreement is conceded, but the defendant 
 contends that, within the time stipulated, he notified the plaintiff, in 
 writing, of his election to abandon the deal, and that no enforceable 
 contract was ever completed between them. The defendant as a 
 witness testifies that late in the evening of February 24, 1911, at Wa- 
 terloo, Jowa, he wrote a letter to the plaintiff informing him of his in- 
 tention to abandon the contract, which letter he addressed to plain- 
 tiff at Waverly, Iowa, the place of his residence, and, having duly sealed 
 and stamped the same, deposited it in a street or hotel letter box pro- 
 vided for such purposes by the United States. The letter itself, being 
 produced, appears to bear the date of February 24, 1911, but the post- 
 mark stamped thereon is dated February 25, 9 a. m., 1911, while the 
 Waverly postmark shows its receipt at that office February 25, 11 :30 a. 
 m., 1911. It was actually received by the plaintiff about 3 o'clock p. 
 m. of the 25th. Upon the facts thus briefly stated, the trial court 
 found plaintiff not entitled to the relief asked. 
 
 *8 The dissenting opinion ot Evans, J., is omitted. 
 
78 OFFER AND ACCEPTANCE (Gh. 1 
 
 The first and principal question presented by the record is whether 
 the defendant signified his election to abandon the contract in such 
 time and in such manner as to relieve himself from obligation to per- 
 form the same. It appears that, while the terms of the exchange were 
 agreed upon and reduced to writing, the defendant was given 30 days 
 in which to examine and satisfy himself as to the Dakota property, 
 with the option on his part to withdraw from the transaction at any 
 time within 30 days from the date of the writing. As expressed by 
 the instrument itself, it was not to become binding upon the defend- 
 ant "until the expiration of said 30 days," unless such time was waived 
 by him. It then provides that: "At the end of 30 days this con- 
 tract is to become binding: upon said second party unless he sooner no- 
 tifies the first party in writing of his intention to abandon and cancel 
 the same.'' 
 
 It is the theory of the appellee, and such is said by counsel to 
 have been the view of the trial court, that when properly construed 
 the contract gives to the defendant the full period of 30 days to exam- 
 ine the property, and that a notice of his refusal to proceed farther, 
 given with reasonable promptness after the expiration of that period, 
 would be timely and relieve him from liability. To reach this conclu- 
 sion, we must ignore the provision by which at the "end of 30 days" 
 the contract was to become binding upon the defendant, "unless he 
 sooner notified first party, in writing, of his intention to abandon the 
 same." But counsel say the writing also provides that defendant 
 shall have 30 days from date in which to examine the property, and, 
 as this privilege continues up to the last hour of the thirtieth day, it. 
 could not have been meant that he must exercise his option or elecr 
 tion before that period expired. ' These provisions, it is argued, are so 
 far repugnant or at least so obscure as to justify the construction 
 by which' notice within reasonable time after the expiration of the stat- 
 ed period may be held sufficient. 
 
 We are disposed to the view, however, that this reading requires too 
 great a strain upon the court's power of construction. The language 
 of the writing is not at all obscure. It provides, in fairly clear terms, 
 for a period of 30 days in which the bargain or agreement shall re- 
 main tentative only. Within that time defendant was at liberty to sat- 
 isfy himself concerning the property he was to receive in the exchange, 
 and, unless he "sooner gave notice" of his withdrawal from the deal, 
 the agreement was to become obligatory upon him "at the end of 30 
 days." In other words, to avoid the binding effect of the contract, he 
 was required to reach his decision and to notify plaintiff thereof in 
 writing, both before the expiration of 30 days. Notice given after that 
 period had elapsed would be unavailing. Such also appears to have 
 been the practical interpretation which defendant appears to have put 
 upon his agreement. He says he had investigated the property and 
 decided not to proceed with the exchange three days before the time 
 
Sec. 5) WHEN NOTICE OF ACCEP-TANCE IS EEQUIREd' 79 
 
 expired, but, because of other business engagements, he neglected to 
 give the notice until late in the evening of the last day, when he en- 
 deavored to do so in the manner indicated,. 
 
 But one other debatable proposition remains. Assuming that de- 
 fendant mailed his letter of withdrawal, as he says he did, by depositing 
 it in a mail box at 10 o'clock in the evening of February 24, 1911, and 
 that such letter reached the hand of plaintiff at Waverly on the after- 
 noon of the following day, 4oes this constitute a notice within the 30- 
 day period? Excluding the day on which the writing bears date, the 
 period of 30 days would expire with the close of February 24, 1911. 
 To hold such notice sufficient it must be on the theory that the deposit 
 of the letter in the mail box is the legal equivalent of placing it in the 
 hands of the plaintiff. That a contract may result from an offer by 
 mail or telegraph and an acceptance communicated by similar means, 
 and that the contract obligation dates from the time of mailing or 
 dispatchirig the acceptance, is of course familiar doctrine. But where 
 parties by agreement condition the acquirement or loss of contract 
 rights upon the giving of a notice within the specified period, not pre- 
 scribing the manner or me'ans of the delivery thereof, we think there is 
 no rule or precedent to the effect that the mailing of such notice op- 
 erates as a delivery or service from the time of its deposit in the post 
 office. For instance, if A. lets his house to B. under an agreement by 
 which the latter is to vacate the premises upon a week's written no- 
 tice from the former, no court would be disposed to hold, in the ab- 
 sence of an express or implied stipulation to that effect, that such no- 
 tice, sent by mail, would be of any avail to terminate the tenancy un- 
 til its actual receipt by the lessee. 
 
 The cases distinctly in point are not very numerous, but they are 
 sufficient to show that the distinction between cases of this character 
 'and those where the question at issue is an acceptance of an offer of 
 purchase or sale has received judicial recognition. See Burhans v. 
 Corey, 17 Mich. 282, in which it is held that a person entitled to notice, 
 where there is no stipulation or consent for its delivery by mail or 
 other specially named means, is not bound by such notice until it is 
 actually received. So also it has been held in Vermont that one who 
 has undertaken to give notice within a specified number of days does 
 not comply with his obligation by depositing notice in the post office 
 at the close of the last day of the stipulated period, too late to be for- 
 warded or delivered withm the time named. Field v. Mann, 42 Vt. 68. 
 This authority is quite in point upon the facts in the case at bar. 
 
 A similar holding is to be found in Society v. Reed, 42 Vt. 76. In 
 Association v. Schauss, 148 111. 304, 35 N. F. 747, the court, speaking 
 with reference to a contract requirement of notice, coupled with a pro- 
 vision that "notice sent to the last address given shall be considered 
 legal notification," says : "As there is no provision in the Constitution 
 to the effect that the service of notice shall date from the time of 
 
80 - OFFER AND AGCEPTANCB (Ch. 1 
 
 mailing, it can only date from the time of jts actual receipt by the mem- 
 ber to whom it is addressed, or at least until sufEcient time has elapsed 
 to enable it to reach him in due course of mail." Upon the same sub- 
 ject it is said by the Massachuse,tts court that: "Ordinarily when the 
 demand must be made or notice given merely posting the document or 
 notice in the mail would not be a communication to the person ad- 
 dressed and would be ineffectual, unless the same be received." Shea 
 V. Association, 160 Mass. 289, 35 N. E. 855, 39 Am. St. Rep, 475. Any 
 other rule would be unreasonable and productive of frequent unjust re- 
 sults. It follows that we must hold that there was a clear failure on 
 the part of the defendant to give notice of his withdrawal from the 
 contract within the time limited therefor, and that the contract be- 
 came and is a binding and enforceable obligation. , 
 
 For the reasons stated, the decree below must be reversed, and the 
 cause remanded for the entry of a decree in accordance with the 
 views here expressed. 
 
 Reversed.** 
 
 SECTION 6.— SILENCE AS ACCEPTANCE 
 
 ROYAL INS. CO. v. BEATTY. 
 
 (Supreme Court of Pennsylvania, 1888. 119 Pa. 6, 12 Atl. 607, 4 Am. St. 
 
 Eep. 622.) 
 
 Error to Court of Common Pleas, Philadelphia County. 
 
 This was an action by William Beatty against the Royal Insurance 
 Company, on a policy of fire insurance, averring a renewal, and that it 
 was in force at the time of the fire. There was a verdict and judg- 
 ment for plaintiff. Defendant brings error. Reversed, 
 
 Green, J. We find ourselves unable to discover any evidence of a 
 contractual relation between the parties to this Utigation. The contract 
 alleged to exist was not founded upon any writing nor upon any words, 
 nor upon any act done by the defendant. It was founded alone upon 
 silence. While it must be conceded that circumstances may exist which 
 will impose a contractual obhgation by mere silence, yet it must be ad- 
 mitted that such circumstances are exceptional in their character, and 
 of extremely rare occurrence. We have not been furnished vvith a per- 
 fect instance of the kind by the counsel on either side of the present 
 case. Those cited for defendant in error had some, other element in 
 them than mere silence which contributed to the establishment of the 
 
 19 See, also, Crown Point Iron Co. v. iEtna Ins. Co., 127 N Y 608 28 N E 
 653, 14 L. R. A. 147 (1891) ; MacUey Wall Plaster Co. v. United States Gyp- 
 sum Co. (D. C.) 244 l^ed. 275 (1917) ; International Filter Co. v. La Granee 
 Ipe & Fuel Co., 22 Ga. App. 167, 95 S. B. 736 (1918), 
 
Sec. 6) SILENCE AS ACCEPTANCE 81 
 
 relation. But, in any point of view, it is difficult to understand how a 
 legal liability can arise out of mere silence of the pa'rty sought to be 
 affected, unless he was subject to a duty of speech,, which was neglect- 
 ed, to the harm of the other party. If there was no duty of speech, 
 there could be no harmful omission arising from mere silence, 
 
 Take the present case as an illustration. The alleged contract was 
 a contract of fire insurance. The plaintiff held two policies against the 
 defendant, but they had expired before the loss occurred, and had not 
 been formally renewed. At the time of the fire the plaintiff held no 
 policy against the defendant. But he claims that the defendant agreed 
 to continue the operation of the expired policies by what he calls "bind- 
 ing" them. How does he prove this? He calls a clerk who took the 
 two policies in questioh, along with other policies of another person, 
 to the agent of the defendant to have them renewed, and this is the 
 account he gives of what took place : "The Royal Company had some 
 policies to be renewed, and I went in and bound them. Question. State 
 what was said and done. Answer. I went into the office of the Royal 
 Company, and asked them to bind the two policies of Mr. Beatty ex- 
 piring to-morrow. The Court. Who were the policies for? A. For 
 Mr. Beatty. The Court. That is your name, is it not? A. Yes, sir. 
 These were the policies in question. I renewed the policies of Mr. 
 Priestly up to the 1st of April. There was nothing more sjtid. about 
 the Beatty policies at that time. The Court. What did they say? A. 
 They did not say anything, but I suppose that they went to their books 
 to- do it. They commenced to talk about the night privilege, and that 
 was the only subject discussed." In his further examination he was 
 asked: "Question. Did you say anything about those policies [Robert 
 Beatty 's] at that time? Answer. No, sir; I only spoke of the two 
 policies for William Beatty. Q. What did you say about them ? A. I 
 went in and said, 'Mr. Skinner, will you renew the Beatty policies, and 
 the night privilege for Mr. Priestly ? ' and that ended it. Q. Were the 
 other companies bound in the same way? A. Yes, sir; and I asked 
 the Royal Company to bind Mr. Beatty." 
 
 The foregoing is the whole of the testimony for the plaintiff as to 
 what was actually, said kt the time when it is alleged the policies were 
 bound.. It will be perceived that all that the witness says is that he 
 asked the defendant's agent to bind the two policies, as he states at 
 first, pr to renew them, as he says last. He received no answer ; noth- 
 ing was said, nor was anything done. How is it possible to make a 
 contract out of this ? It is not as if one declares or states a fact in the 
 presence of another, and the other is silent. If the declaration imposed 
 a duty of speech on peril of an inference from silence, the fact of si- 
 lence might justify the inference of an admission of the truth of the 
 declared fact. It would then be only a question of hearing, which 
 would be chiefly, if not entirely, for the jury. But here the uttera,nce 
 was a question, and not an assertion ; and there was no answer to the 
 
 OORBIN CONT.^-6 
 
82 OFFER AND ACCEPTANCE (Ch. 1 
 
 question. Instead of silence being evidence of an agreement to do the 
 thing requested, it is evidence, either that the question was not heard, 
 or that it was not intended to comply with the request. Especially is 
 this the case when, if a compliance was intended, the request would 
 have been followed by an actual doing of the thing requested. But 
 this was not done ; how, then, can it be said it was agreed to be done ? 
 There is literally nothing upon which to base the inference of an agree- 
 ment, upon such a state of facts. Hence the matter is for the court, 
 and not for the jury ; for, if there may not be an inference of the con- 
 troverted fact, the jury must not be permitted to make it. 
 
 What has thus far been said relates only to the effect of the non- 
 action of the defendant, either in responding, or doing the thing re- 
 quested. There remains for consideration the effect of the plaintiff's 
 non-action. When he asked the question whether defendant would 
 bind or renew the policies, and obtained no answer, what was his duty ? 
 Undoubtedly, to repeat his question until he obtained an answer; for 
 his request was that the defendant should make a contract with him, 
 and the defendant says nothing. Certainly, such silence is not an as- 
 sent in any sense. ' There should be something done, or else something 
 said, before it is possible to assume that a contract was established. 
 There being nothing done and nothing said, there is no footing upon 
 which ar» inference of agreement can stand. But what was the posi- 
 tion of the plaintiff ? He had asked the defendant to make a contract 
 with him, and the defendant had not' agreed to do so ; he had not 
 even answered the question whether he would do so. The plaintiff 
 knew he had obtained no answer, but he does not repeat the question ; 
 he, too, is silent thereafter, and he does not get the thing done which 
 he asks to be done. Assuredly, it was his duty to speak again, and to 
 take further action, if he really intended to obtain the defendant's as- 
 sent ; for what he wanted was somjsthing affirmative and positive, and 
 without it he has no status. But he desists, and does and says nothing 
 further. 
 
 And so it is that the whole of the plaintiff's case is an unanswered 
 request to the defendant to make a contract with the plaintiff, and no 
 further attempt by the plaintiff to obtain an answer, and no actual con- 
 tract made. Out of such facts it is not possible to make a legal infer- 
 ence of a contract. The other facts proved, and offered to be proved, 
 but rejected, improperly as we think, and supposed by each to be con- 
 sistent with his theory, tend much more strongly in favor of the de- 
 fendant's theory than of the plaintiff's. It is not necessary to discuss 
 them, since the other views we have expressed are fatal to the plain- 
 tiff's claim. Nor do I concede that if defendant heard plaintiff's re- 
 quest, and made no answer, an inference of assent should be made; 
 for the hearing of a request, and^iot answering it, is as consistent, in- 
 deed more consistent with a dissent than an assent. If one is asked for 
 alms on the street, and hears the request, but makes no answer, it cer- 
 tainly cannot be inferred that he intends to give them. In the present 
 
Sec. 6) SILENCE AS ACCEPTANCE 83 
 
 case there is no evidence that defendant heard the plaintiff's request, 
 and, without hearing, there was of course no duty of speech. 
 Judgment reversed.^" 
 
 DAY V. CATON. 
 
 (Supreme Judicial Court of Massachusetts, 1876. 119 Mass. 513, 20 Am. 
 
 Rep. 347.) 
 
 Contract to recover the value of one-half of a brick party wall 
 built by the plaintiff. 
 
 The defendant requested the judge to rule that: "(1) The plain- 
 tiff can recover in this case only upon an express agreement. (2) If 
 the jury find there was no express agreement about the wall, but the 
 defendant knew that the plaintiff was building upon land in which 
 the defendant had an equitable interest, the defendant's rights would 
 not be affected by such knowledge, and his silence and subsequent 
 use of the wall would raise no implied promise to pay anything for 
 the wall." 
 
 The judge refused so to rule, but instructed the jury as follows : 
 "A promise would not be implied from the fact that the plaintiff, 
 with the defendant's knowledge, built the wall and the defendant used 
 it, but it might be implied from the conduct of the parties. If the 
 jury find that the plaintiff undertook and completed the building of 
 the wall with the expectation that the defendant would pay him for it, 
 and the defendant had reason to know that the plaintiff was so acting 
 with that expectation, and allowed him so to act without objection, 
 then the jury might infer a promise on the part of the defendant to 
 pay the plaintiff." 
 
 There was a verdict for the plaintiff. Defendant alleged excep- 
 tions." 
 
 Devens, J. The ruling that a promise to pay for the wall would 
 not, be implied from the fact that the plaintiff, with the defendant's 
 knowledge, built the wall, and that the defendant used it, was sub- 
 stantially in accordance with the request of the defendant, and is con- 
 ceded to have been correct. Chit. Cunt. (11th Ed.) 86; Wells v. Ban- 
 co The silence of an offeree, unaccompanied by other circumstances, is not 
 an acceptance. Carnahan Mfg. Co. v. Beebe-Bowles Co., 80 Or. 124, 156 Pac. 
 584 (1916) ; Grice v. Noble, 59 Mich. 515, 26 N. W. 688 (1886) ; Raysor v. 
 Berkeley Ry. & Lumber Co., 26 S. C. 610, 2 S. E. 119 (1887) ; Clark v. 
 Potts, ?55 111. 183, 99 N. E. 364 (1912) ; Beach v. U. S., 226 U. S. 243, 33 Sup. 
 Ot 20, 57 L. Ed. 205 (1912). Indeed it has been held that silence does not 
 operate as acceptance, even though the offeror prescribes it as the mode of 
 acceptance and the offeree intends it as an acceptance. Prescott v. Jdnes, 69 
 N. H. 305, 41 Atl. 352 (1898); Felthouse v. Bindley, 11 C. B. N. S. 868 (1862). 
 
 Mere delay in passing on an application for insurance, even thoiigh the first 
 premium is inclosed vi'ith the application, is not an acceptance by the insurer. 
 Dorman v. Connecticut Fire Ins. Co., 41 Okl. 509, 139 Pac. 262, 51 L. R. 
 A. (N. S.) 873 (1914) ; Northv^estern Mut. Life Ins. Co. v. Neafus, 145 Ky. 563, 
 140 S. W. 1026, 36 L. R. A. (N. S.) 1211 (1911) ; Van Arsdale & Osborne v. 
 Toung, 21 Okl. 151, 95 Pac. 778 (1908). 
 51 The statement of facts is abridged. 
 
84 OFFER AND ACCEPTANCE (Ch. 1 
 
 ister, 4 Mass. 514; Knowlton v. Plantation No. 4, 14 Me. 20; Davis 
 V. School Dist., 24 Me. 349. 
 
 The defendant, however, contends that the presiding judge incor- 
 rectly ruled that such promise might be inferred from the fact that 
 the plaintiff undertook and completed the building of the wall with the 
 expectation that the defendant would pay him for it, the (defendant 
 having reason to know that the plaintiff was acting with that expecta- 
 tion, and allowed him thus to act without objection. 
 
 The fact that the plaintiff expected to be paid for the work would 
 certainly not be- sufficient of itself to establish the existence of a con- 
 tract, when the question between the parties was whether one was 
 made. Taft v. Dickinson, 6 Allen, 553. It must be shown that in 
 some manner the party sought to be charged assented to it. If a part)', 
 however, voluntarily accepts and avails himself of valuable services 
 rendered for his benefit, when he has the option whether to accept or 
 reject them, even if there is no distinct proof that they were rendered 
 by his authority or request, a promise to pay for them may be in- 
 ferred. His knowledge that they were valuable, and his, exercise of the 
 option to avail himself of them, justify this inference. Abbot v. Her- 
 mon, 7, Greenl. (Me.) 118; Hayden v. Madison, 7 Greenl. (Me.) 76. 
 And when one stands by in silence, and sees valuable services rendered 
 upon his real estate by the erection of a structure (of which he must 
 necessarily avail himself afterwards in his proper use tliereof), such 
 silence, accompanied with the knowledge on his -part that the party 
 rendering the services expects payment therefor, may fairly be treated 
 as evidence of an acceptance of it, and as tending to show an agreement 
 to pay for it. 
 
 The maxim, "Qtii facet consentire videtur," is to be construed in- 
 deed as applying only to those cases where the circumstances are such 
 that a party is fairly called upon either to deny or admit his liability. 
 But, if silence may be interpreted as assent where a proposition is made 
 to one which he is bound to deny or admit, so also it may be if he is 
 silent in- the face of facts which fairly call upon him to speak. Lamb 
 V. Bunce, 4 Maule & S. 275 ; Connor v. Hackley, 2 Mete. (Mass.) 613 ; 
 Preston v. Linen Co., 119 Mass. 400. 
 
 If a person saw day after day a laborer at work in his field doing 
 services, which must of necessity iniare to his benefit, knowing that 
 the laborer expected pay for his w&rk, when it was perfectly easy to 
 notify him if his services were not wanted, even if a request were 
 not expressly proved, such a request, either previous to or contempo- 
 raneous with the performance of the services, might fairly be infer- 
 red. But if the fact was merely brought to his attention upon a single 
 occasion and casually, if he had little opportunity to notify the other 
 that he did not desire the work and should not pay fo,r it, or could only 
 do so at the expense of much time and trouble, the same inference 
 might not be made. The circumstances of each case would necessarily 
 determine whether silence with a knowledge that another was doing 
 
Sec. 6) SILENCE AS ACCEPTANCE 85 
 
 valuable work for his benefit, and with the expectation of payment 
 indicated that consent which would give rise to the inference of a 
 contract. The question would be one for the jury, and to them it was 
 properly submitted in the case before us by the presiding judge. 
 Exceptions overruled. °^ 
 
 AUSTIN V. BURGE. 
 
 (Kansas City Court of Appeals. Missouri. 1911. 156 Mo. App. 286, 137 
 
 S. W. 618.) 
 
 Action by O. D. Austin against Charles Burge. Erom a judgment 
 for defendant, plaintiff appeals. Reversed and remanded. 
 
 Ellison, J. This action was brought on an account for the sub- 
 scription pricQ of a newspaper. The judgment in the trial court was 
 for the defendant. It appears that plaintiff was publisher of a news- 
 paper in Butler, Mo., and that defendant's father-in-law subscribed for 
 the paper, to be sent to defendant ior two years, and that the father- 
 in-law paid for it for that time. It was then continued to be sent 
 to defendant, through the mail, foir several years more. On two oc- 
 casions defendant paid a bill presented for the subscription price, but 
 each time directed it to be stopped. Plaintiff denies the order to stop, 
 but for the purpose of the case we shall assume that defendant is 
 correct. He testified that, notwithstanding the order to stop it, it was 
 continued to be sent to him, and he continued to receive and read it, 
 until finally he removed to another state. 
 
 We have not been cited to a case in this state involving the liability 
 of a person who, though not having subscribed for a newspaper, con- 
 tinues to accept it by receiving it through the mail. There are, how- 
 ever, certain well-understood principles in the law of contracts that 
 ought to solve the question. It is certain that one cannot be forced 
 into contractual relations with another and that therefore he cannot, 
 against his will, be made the debtor of a newspaper publisher. But it 
 is equally certain that he may cause contractual relations to arise by 
 necessary implication from his conduct. The law in respect to con- 
 tractual indebtedness for a newspaper is not different from that relat- 
 ing to other things which have not been made the subject of an ex- 
 press agreement. Thus one may not have ordered supplies for his 
 table, or other household necessities, yet if he continue to receive and 
 use thejn, under circumstances where he had no right to suppose they 
 were a gratuity, he will be held to have agreed, by implication, to pay 
 their, value. In this case defendant admits that, notwithstanding he 
 ordered the paper discoritinued at the time when he paid a bill for it, 
 yet plaintiff continued to send it, and he continued to take it from the 
 post office to his home. This was an acceptance and use of the prop- 
 
 5 2 Observe that in this and in the three succeeding cases the' contract is 
 unilateral, the only legal duty created being on the offeree, with the correla- 
 tive right In the offeror. Such transactions are often described, somewhat in- 
 accurately, as an' offer of an act for a promise. 
 
86 OFFER AND ACCEPTANCE (Ch. 1 
 
 erty, and, there being no pretense that a gratuity was intended, an ob- 
 Hgation arose to pay for it. 
 
 A case quite applicable to the facts here involved arose in Fogg v: 
 Atheneum, 44 N. H. 115, 82 Am. Dec. 191. There the Independent 
 Democrat newspaper was forwarded weekly by mail to the defendant 
 from May 1, 1847, to May 1, 1849, when a bill was presented, which 
 defendant objected to paying on the ground of not having subscribed. 
 Payment was, however, finally made, and directions given to discon- 
 tinue. The paper changed ownership, and the order to stop it was not ' 
 known to the new proprietors for a year ; but, after being notified of 
 the order, they nevertheless continued to send it to defendant until 
 1860, a period of 11 years, and defendant continued to receive it 
 through the post office. Payment was several times demanded during 
 this time, but refused on the ground that there was no subscription. 
 The court said that : "During this period of time the defendants were 
 occasionally requested, by the plaintiff's agent, to pay their bill. The 
 answer was, by the defendants, 'We are not subscribers to your news- ^ 
 paper.' But the evidence is the defendants used or kept the plain- 
 tiff's * * * newspapers, and never offered to return a number^ as 
 they reasonably might have done, if they would have avoided the 
 liability to pay for them. Nor did they ever decline to take the news- 
 papers from the post office." The defendant was held to have accepted 
 the papers, and to have become liable for the subscription price by im- 
 plication of law. 
 
 In Ward v. Powell, 3 Har. (Del.) 379, it was decided that an implied 
 agreement to pay for a newspaper or periodical arose by the continued 
 taking and accepting the paper from the post office, and that "if a par- 
 ty, without subscribing to a paper, declines taking it out of the post 
 office, he cannot become liable to pay for it; and a subscriber may 
 cease to be such at the end of the year, by refusing to take the papers 
 from the post office, and returning them to the editor as notice of 
 such determination." In Goodland v. Le Clair, 78 Wis. 176, 47 N. 
 W. 268, it was held that if a person receives a paper from the post 
 office for a year, without refusing or returning it, he was liable for the 
 year's subscription. And a like obligation was held to arise in the case 
 of Weatherby v. Bonham, 5 C. & P. 228. 
 
 The preparation and publication of a newspaper involves much 
 mental and physical labor, as well as an outlay of money. One who 
 accepts the paper, by continuously taking it from the post office, re- 
 ceives a benefit and pleasure arising from such labor and expenditure as 
 fully as if he had appropriated any other product of another's labor, 
 and by such act he must be held liable for the subscription price. 
 On the defendant's own evidence, plaintiff should have recovered. 
 
 The judgment will therefore be reversed, and the cause remanded. 
 All concur.^ ^ ■ 
 
 6 3 wiiere the periodical sent is not read or used, there is no duty to pay. 
 Realty Eecords Co. v. Pierson (Sup.) 116 N. Y. Supp. 547 (1909). 
 
Sec. 6) SILENCE AS ACCEPTANCE 87 
 
 HOBBS V. MASSASOIT WHIP CO. 
 (Supreme Judicial Court of Massachusetts, 1893. 158 Mass. 194, 33 N. E. 495.) 
 
 Contract, upon an account annexed for one hundred and eight dol- 
 lars and fifty cents, for 2,350 eelskins sold by the plaintiff to the de- 
 fendant. At the trial in the Superior Court, before Hammond, J., it 
 appeared in evidence that the plaintiff lived in Saugus, and the de- 
 fendant had its usual place of business in Westfield, and was engaged 
 in the manufacture of whips. 
 
 The jury returned a verdict for the plaintiff, and the defendant al- 
 leged exceptions.^* 
 
 HoivMBS, J. This is an action for the price of eelskins sent by the 
 plaintiff to the defendant, and kept by the defendant some months, un- 
 til they were destroyed. It must be taken that the plaintiff received 
 no notice that the defendants declined to accept the skins. The case 
 coities before us on exceptions to an instruction to the jury, that, wheth- 
 er there was any prior contract or not, if skins are sent to the defend- 
 ant, and it sees fit, whether it has agreed to take them or not, to lie 
 back, and to say nothing, having reason to suppose that the man who 
 has sent them believes that it is taking them, since it says nothing about 
 it, then, if it fails to notify, the jury would be warranted in finding for 
 the plairitiff. 
 
 Standing alone, arid unexplained, this proposition might seem to 
 imply that one stranger may impose a duty upon another, and make 
 him a purchaser, in spite of himself, by sendiiig goods to him, unless 
 he will take the trouble, and be at the expense, of notifying the sender 
 that he will not buy. The case was argued for the defendant on that 
 interpretation. But, in view of the evidence, we do not understand 
 that to have been the meaning of the judge, and we do not think that 
 the jury can have understood that to have been his meaning. The 
 plaintiff was not a stranger to the defendant, even if there was no con- 
 tract between them. He had sent eelskins in the same way four or 
 five' times before, and they had been accepted and paid for. On the de- 
 fendant's testimony, it is fair to assume that, if it had admitted the eel- 
 skins to be over twenty-two inches in length, and fit for its business, as 
 the plaintiff testified, and the jury found that they were, it would have 
 accepted them ; that this was understood by the plaintiff ; and, indeed, 
 that there was a- standing offer to him for such skins. In such a con- 
 dition of things, the plaintiff was warranted in sending the defendant 
 skins conforming to the requirements, and even if the offer was not 
 such that the contract was made as soon as skins corresponding to its 
 terms were sent, sending them did impose on the defendant a duty to 
 act about them ; and silence on its part, coupled with a retention of the 
 skins for an unreasonable time, might be found by the jury to war- 
 rant the plaintifif in assuming that they were accepted, and thus to 
 
 64 The statement of facts is abridged. 
 
88 OFFER AND ACC^ErTANCB (Ch, 1 
 
 amount to an acceptance. See Bushel v. Wheeler, 15 Q. B. 442; Ben- 
 jamin on Sales, §§ 162-164; Taylor v. Dexter Engine Co., 146 Mass. 
 613, 615, 16 N. E. 462. The proposition stands on thq general princi- 
 ple that conduct which imports acceptance or assent is acceptance or 
 assent in the view of the law, whatever may have been the acttlal state 
 of mind of the party — a principle sometimes lost sight of in the cases. 
 O'Donnell v. Clinton, 145 Mass. 461, 463, 14 N. E. 747; McCarthy v. 
 Boston & Lowell Railroad, 148 Mass. 550, 552, 20 N. E.,182, 2 L. R. 
 A. 608. 
 
 Exceptions overruled. °° 
 
 F. O. EVANS PIANO CO. v. TULLY. 
 
 (Supreme Court of Mississippi, 1917. 116 Miss. 267, 76 South. 833, L. R. A. 
 
 1918B, 870.) ' 
 
 Suit by the F. O. Evans Piano Company against A. J. TuUy. From 
 a judgment for defendant, plaintiff appeals. Reversed, and judgment 
 entered for plaintiff. 
 
 Ethridge, J. Appellant, a piano dealer of Chicago, 111., placed a 
 piano with Tully, at Laurel, Miss., under a contract signed by TuUy, 
 which is substantially as follows : 
 
 "I accept your offer to try one of your Evans Artist Model Pianos. 
 Without any obligation on my part to purchase, you ma,y ship the piano 
 ordered below. After testing the instrument for thirty days, if I decide 
 to keep it, I will pay for it as stated below, and will sign your selling 
 contract which is a part hereof. If I decide not to keep it, I will re- 
 turn the piano to the freight depot, subject to your order." 
 
 Then follows a description of the piano and the terms of sale, in 
 which it was agreed to pay for the piano in monthly installments. The 
 piano was shipped to Tully on this "order. On December 31, Tully 
 wrote that the music rolls had been received, but that the piano had 
 not arrived, although he had phoned all the freight offices. On Janu- 
 ary 8, 1913, Tully wrote to the piano company that the piano had ar- 
 rived that day in bad condition, there being some marks on the keys, 
 and the player out of commission ; that it seemed to have been rough- 
 ly handled in transit. He also returned the freight bills and requested 
 check to cover same, also requesting the piano company to have its 
 agent call and look over the piano. On January 13th the piano cona- 
 pany wrote Tully, aclcnowl edging receipt of his letter of the 8th, and 
 inclosing check for the freight bills, but returned the freight bills 
 
 6 5 In Bohn Mfg. Co. v. Sa\vyer, 169 Mass. 477, 482, 48 N. E. 620 (1897) Allen. 
 J., said: "From the defendant's silence in respect to the plaintiff's proposal 
 to effect insurance at their joint expense, and from his subsequent letters and 
 conduct in respect to the policies, the jury might well infer that he assented 
 to that proposal ; and if the jury found that such was the fair import of his 
 correspondence and acts, or that the plaintiff believed and had reason to be- 
 lieve that he did assent to it, his secret intention not to do so was immate- 
 rial." ' 
 
Sec. 6) SILENCE AS ACCEPTANCE 89 
 
 and asked that Tully have the agent mark on the freight, bills 
 that the piano was received in bad condition, so that damages 
 could be collected from the carrier, and directed Tully to have the 
 piano retui-ned, if it could not be satisfactorily fixed, and another 
 would be sent. It was also suggested that he get a piano tuner to look 
 over the piano and see if it could be put in proper condition, and to 
 send the bill to the piano company for payinent. To this letter the 
 appellee did not reply. 
 
 On February 28th the piano company again wrote Tully, asking him 
 to have the piano fixed, and to have the freight bills marked by the 
 agent so they could collect damages from the company. There was no 
 reply to this letter, and on March 11th the piano company again 
 wrote Tully along the same lines. No reply was made to this letter, 
 aifd on March 19th the piano company wrote another letter along the 
 same lines. On March 27th the company wrote another letter, to 
 which no reply was received, and again on April 4th, 10th, 18th, and 
 28th, and May 6th. May 10th, Mrs. Tully, wife of appellee wrote the 
 piano company, stating that they had been away from home for some 
 time, and that the piano was in good hands while they were away, 
 stating, also, that when the piano was received the player mechanism 
 had dropped about 1^^ inches and was resting on the keys or hammers, 
 and that they had a tuner fix the same, who only had to straighten the 
 bolts that supported the player, and which had been bent, for which 
 there was no charge ; that the piano needed tuning, but was otherwise 
 all right, and stating that every one Vvho saw the piano thought it was 
 a beautiful instrument. On May 20th appellant replied to this letter 
 and requested a signature to the contract and a remittance, but no 
 answer was received to this letter. On June 29th appellant again 
 wrote Tully, and again on August 12th. On August 14th Mrs. Tully 
 wrote in reply to the letter of the 12th that she did not think the piano 
 was what, they wanted. On August 18th appellant replied to this let- 
 ter, calling attention to its numerous letters in which appellee had been 
 urged to either return the piano or sign the contract, and to have the 
 freight bill marked by the agent, and stating that they could not take 
 back the piano under the circumstances. 
 
 Appellee testifies, and also Evans of the piano company. Appellee 
 contended in his testimony that the piano was not in good condition, 
 and was not up to representations, etc. At the conclusion of the evi- 
 dence, plaintifif requested a peremptory instruction, which was refus- 
 ed by the court. Appellant also requested an instruction that the de- 
 fendant was under obligation to return the piano within a reasonable 
 time after the 30-day trial period, to some common carrier or railroad 
 for reshipment, and if the jury believed the defendant did not, within 
 a reasonable time, return the piano, their verdict must be for the plain- 
 tiff, which was also refused. 
 
 We think that, under the contract, the appellee, defendant below, was 
 tinder the duty to either accept the piano or return it to the depot of a 
 
90 OFFER AND ACCEPTANCE (Ch. 1 
 
 common carrier at the end of a 30-day trial period, and a's the proof 
 shows there was no effort whatever to return the piano, and that the 
 defendant below did not respond to the numerous letters of the plain- 
 tiff between January 13th and May 8th, he must be treated in law as 
 having accepted the piano. The peremptory instruction for the appel- 
 lant should therefore have been given. The judgment of the court be- 
 low is accordingly reversed, and judgment will be entered here for the 
 appellant. 
 
 Reversed, and judgment here.^*" 
 
 Stevens, J. (dissenting).", A reversal of this case is based upon 
 the claimed right of the piano company to a peremptory instruction. 
 This expression of my views will be directed solely to this point. As I 
 construe the one and only contract executed by Mr. Tully, it is an 
 agreement merely to permit the Evans Piano Company to place one of 
 their musical instruments' in Tully's home to be tried or tested without 
 any obligation whatever on the part of Mr. Tully to buy. This is the 
 express language of the contract itself. It says : 
 
 "I accept your offer to try one of your Evans Artist Model pianos. 
 Without any obligation on my part to purchase, you may ship the pi- 
 ano ordered below." 
 
 The primary condition upon which Mr. Tully permitted the piano to 
 be installed in his home was stated in the language, "without any ob- 
 ligation on my part to purchase." There is another significant state- 
 ment in this contract, and that is when appellee had tested the instru- 
 ment and had decided to keep it he would then for the first time exe- 
 cute a contract of purchase. The language is, "if I decide to keep it; 
 I will pay for it as stated below, and will sign your selling contract, 
 which is a part hereof.". If he decides to keep it he will th^n "sign 
 your selling contract." This so-called "selling contract" does not seem 
 to be incorporated in the record, and I do not know what its proposed 
 
 06 gee, also, the following similar decisions: Emery v. Cobbey, 27 Neb. 621, 
 43 N. "W. 410 (1889) ; Hanson &; Parlser v. Wittenberg, 205 Mass. 319, 91 N. E. 
 383 (1910) ; Wheeler v. KlahOlt, 178 Mass; 141, 59 N. E. 756 (1901) ; Ostman 
 V. Lee, 91 Conn. 781, 101 Atl. 23 (1917) ; Place v. Mcllvain, 38 N. Y. 96, 97 
 Am. Dec. 777 (1868). 
 
 In Oole-Mclntyre-Norfleet Co. v. HoUoway, 141 Tean. 679, 214 S. W. 817, 
 7 A. L. R. 1683 (1919), the traveling agent of the defendant called on the 
 plaintiff and there solicited and received an "order" for 50 barrels of meal, 
 to be delivered at buyer's option at any time within four months. The writ- 
 ten order expressly stated that it was not to be binding on defendant until its 
 acceptance at the home office. No word was sent by the defendant to the 
 plaintiff ; and two months later the plaintiff asked that the meal be shipped. 
 Meantime meal had advanced 50 per cent, in value. The defendant x-efused 
 to ship, saying that it had never accepted the order. The court held that there 
 was a contract, saying: "We think it is the duty of a wholesale merchant, 
 who sends out his drummers to solicit orders for perishable articles, and 
 articles consumable in the use, to notify his customers within a reason- 
 able time that the orders are not accepted ; and if he fails to do so, and 
 the proof shows that he had ample opportunity, silence for an unreasonable 
 length of time will amount to an acceptance, if the offerer is relvins uuon him 
 for the goods." See 29 Yale L. Jour. 441. ' ^ b i^ ^ 
 
 " Part of the dissenting opinion is omitted. 
 
Sec. 6) SILENCE AS ACCEPTANCE 91 
 
 terms and provisions are. It was evidently a blank form or contract to 
 be filled out later with the privilege to pay for the piano on the install- 
 ment plan. It may also have made provision whereby the vendor re- 
 tained title as security. The contract then which Tully signed; was not 
 a contract of purchase. The court now makes him take the piano, and 
 compels him to assume the attitude of purchaser simply because Tully 
 did not return the piano to the depot within such time as the court 
 thinks reasonable. 
 
 The question of what was or was not a reasonable time was submit- 
 ted to the jury under instructions from the court, and the jury by their 
 verdict has found that Tully did not keep the piano an unreasonable 
 length of time. There is indeed room to suspect that Mr. Tully did not 
 act in the utmost good faith, or at least did not act diligently, but his 
 testimotxy explains this. He says that when the piano arrived "it was 
 in bad condition. It was badly torn up and broken in transit, and bad- 
 ly out of tune, too." He furthermore testifies that "it was not as rep- 
 resented. It was of very poor grade." This testimony on the part of 
 the appellee is uncontradicted. It was offered to explain the necessity 
 for having the piano repaired before a fair test could be made. Mr. 
 Tully furthermore testifies that he notified the house of his dissatisfac- 
 tion, and "asked twice for shipping instructions on it" ; tjiat they never 
 gave any shipping instructions, but insisted upon his signing the 
 contract of purchase, the very contract which the preliminary agree- 
 ment contemplated. It is significant also that the tentative agree^ 
 ment nowhere states the terms of the trade, but leaves blank spaces un- 
 filled. The purchaser had the right to pay cash within 30 days, and re- 
 ceive one kind of discount, or to pay cash in 60 days, and receive an- 
 other and different discount, or the option to pay at $10 cash after 30 
 days and the balance at the rate of $10 a month. 
 
 The declaration here sues for the entirfe price, and it is nowhere in- 
 timated that Tully agreed to pay cash fof the piano. There is, then, 
 not only an absence of an agreement to buy at all, but especially an ab- 
 sence of any agreement to pay cash. As I see it, there is an absence of 
 mutuality. It is shown that appellant had an agent in this territory, 
 and that appellee requested that the 'agent call. Instead of the agent 
 calling to see about the damage to the piano, and having the instrument 
 tuned, the piano house was writing letters to Mr. Tully asking him to 
 have this done, and at the same time asking that he sign the contract. 
 The piano company at no time requested Tully to reship the piano, and 
 at no time gave shipping instructions. They do not seem to have been 
 interested in having the piano resliipped, but at all times were demand- 
 ing an execution of the written contract of purchase. The contract 
 which the correspondence asked Tully to sign gave him benefit of the 
 monthly payment plan. This is sufficient to show that there was no 
 definite agreement as to terms. The agreement, then, was simply an 
 agreement to agree; an agreement to experiment with, to try or test. 
 This being so, when Tully declined to execute any contract after the 
 
92 OFFER AND ACCEPTANCE (Ch. 1 
 
 expiration of the 30-day period for trial, he should not be compelled to 
 pay for the piano, and cannot be compelled to do so except upon the 
 doctrine of estoppel. 
 
 Of course, if Tully had, after the 30 days, signified an acceptance, 
 or had, as in some cases of this kind, attempted to sell the property as 
 his own, an acceptance would be conclusively presumed and the pur- 
 chaser would be liable. But there is no showing that Tully exercised 
 actual ownership over the property inconsistent with his expressions of 
 dissatisfaction. There is no evidence whatever that he even used the 
 piano after he decided it was not up to representations and what he 
 wanted. He swears that he not only wrote letters to the house offer- 
 ing to return and asking for shipping instructions, but he also offered 
 to return the piano to appellant's attorney, Mr. Welch, and he kept up 
 this offer on the trial of the case. * * * The opinion of the court 
 forces Tully to buy a piano and piano player against his will, v 
 
 JENNESS V. MT. HOPE IRON CO. 
 (Supreme Judicial Court of Maine, 1864. 53 Me. 20.) 
 
 Walton, J.°^ This is an action for an alleged breach of contract, 
 and is before us on report. If so much of the plaintiff's evidence 
 as is admissible, is sufficient, prima facie, to entitle him to damages, 
 the case is to stand for trial; otherwise a nonsuit is to be entered. 
 
 The plaintiff says that the defendants bargained and sold to him 
 three hundred and three kegs of nails, to be delivered at Bangor, 
 before the close of navigation, in the fall of 1862. 
 
 The defendants do not deny that there was a negotiation for the 
 sale of nails; but they deny that the negotiation ever ripened into 
 a contract, by which the parties were bound; and the question is 
 whether the evidence is sufficient, prima facie, to show such a con- 
 tract ; that is, a contract completed. 
 
 The negotiation was carried on by letter ; and, omitting what is irrele- 
 vant and immaterial, amounts substantially to this: 
 
 Plaintiff, (Oct. 20, 1862:) "What will you sell me 450 kegs of 
 nails for, delivered at Bangor, in the course of a month, cash down?'' 
 
 Defendants, (Oct. 23, 1862:) "We will sell you 450 casks common 
 assorted nails, delivered on the dock at Bangor, at $3.62 per keg of 
 100 lbs. each, cash." 
 
 Plaintiff, (Oct. 27, 1862 :) "Nails have advanced so much I am al- 
 most afraid to buy; 'but you will send me as soon as possible, 303 
 kegs, (naming the kinds,) and I will send you a check on Exchange 
 Bank, Boston. 
 
 Plaintiff, (Nov. 11, 1862:) "Not having heard whether you have 
 shipped the nails ordered, I thought I would write you as we shall have 
 but a few weeks more of navigation." 
 
 •'is The statement of facts and part of the opinion are omitted. 
 
Sec. 6) SILENCE AS ACCEPTANCE 93 
 
 Defendants, (Nov. 14, 1862 :) "It will not be possible for us to get 
 out the nails you have ordered this monthj as previous orders must 
 take precedence. It is next to impossible for us to get out nails enough 
 to supply our back orders, and we thought it best to write you, as 
 navigation may be closed too soon for us to forward them this fall. 
 We will, however, do our best to satisfy all our customers, and your 
 order shall receive attention when we get to it." 
 
 This is the whole substance of the written correspondence between 
 these parties, and we look in vain to find in it evidence of a contract, 
 completed ; a proposition by one party, accepted without modification, 
 by the other. 
 
 The defendants offered to deliver four hundred and fifty casks at 
 $3.62 per cask; but this offer was not accepted by the plaintiff; and 
 his order for three hundred and three casks does not appear to have 
 been accepted by the defendants. 
 
 We look in vain for a distinct proposition by either party, which 
 is accepted without modification by the other. 
 
 To constitute a contract, there must be a proposition by one party, 
 accepted by the other, without any modification whatever. If the 
 ■ acceptance modifies the proposition in any particular, however trifling, 
 it amounts to no more than a counterproposition '; it is not in law an 
 acceptance which will complete the contract. The letters between 
 these parties fail, therefore, to establish a prima facie case for the 
 plaintiff. 
 
 The learned counsel for the plaintiff admit that the letters "do not 
 probably of themselves constitute a contract;" but they insist that, 
 under the circumstancjss, slight evidence would be sufficient to supply 
 the defect, and show that in fact the plaintiff's modified order was ac- 
 cepted by the defendants. It is highly probable that when the de- 
 fendants received the plaintiff's order of October 27, they intended 
 to fill it; otherwise they should have notified him, and not by their 
 silence left him to infer that the nails would be forwarded, when they 
 had no intention of doing it. And if such an intention would be 
 sufficient to complete the contract, and render it binding upon the 
 parties, we might, perhaps, feel justified in inferring it from the de- 
 fendant's silence, and other facts testified to by the plaintiff. But we 
 are not satisfied that such an intention^ locked up in the breast of a 
 party, and not communicated to the other, is sufficient in any case to 
 constitute such an acceptance of a proposition as to create a binding 
 contract. We think it would not. 
 
 It would be unjust to the other party to hold him bound by such 
 an acceptance; and, unless both parties would be bound by it, neither 
 would be, for want of mutuality..'"' * * * 
 
 59 Silence of tbe original offeror does not operate as an acceptance of a 
 counter offer. Cincinnati Equipment Co. v. Big Muddy fliver Consol. Coal 
 Co., 158 Ky. 247, 164 S. W. 794 (1014), unless expressly so agreed ; Bowen v. 
 
94 OFFER AND ACCEPTANCE (Ch. 1 
 
 SECTION 7.— CONDITIONAL ACCEPTANCE AND RE- 
 JECTION 
 
 BEAUMONT v. PRIETO et al. 
 
 (Supreme Court of the United States, 1919. 249 U. S. 554, 39 Sup. Ct. 383, 
 
 63 L. Ed. 770.) 
 
 Suit by Hartford Beaumont, assignee of W. Borck, against Mauro 
 Prieto and others. Decree for plaintiff was reversed by the Supreme 
 Court of the PhiHppine Islands, and plaintiff appeals and brings error. 
 Affirmed. 
 
 Mr. Justice Holmes. This is a suit for the specific performance of 
 an alleged contract to sell land. The court of first instance made a 
 decree for the plaintiff, hijit the decree was reversed by the Supreme 
 Court of the Philippine Islands and the defendants were absolved from 
 the complaint. There is a motion to dismiss, on the ground that the 
 writ of error and citation were not made returnable in time. But with- 
 out going into particulars, as the appellant had color of authority from 
 the court and a judge of that court, it appears to us that justice will be 
 better served by dealing with the merits of the case. See Southern 
 Pine Co. v. Ward, 208 U. S. 126, 137, 28 Sup. Ct. 239, 52 L. Ed. 420. 
 
 On the merits the only question is whether the alleged contract was 
 made. The first material step was the following offer, dated December 
 4, 1911: 
 
 "Mr. W. Borck, Real Estate Agent, Manila, P. I. — Sir: In com- 
 pliance with your request I herewith give you an option for three 
 months to buy the property of Mr. Benito Legarda, known as the Nag- 
 tahan hacienda, situated in the district of Sampaloc, Manila, and con- 
 McCarthy, 85 Mich. 26, 48 N. W. 155 (1891), "he had a right to disregard it 
 [counter offer] ; nor was it his duty to notify complainant. 
 
 In the case of a late acceptance, the power of acceptance having lapsed, it 
 has been suggested that silence by the cfriginal offeror should complete a con- 
 tract. Phillips v. Moor, 71 Ble. 78 (1880). See, also, German Civil Code, § 149 ; 
 Swiss Code Oblig. § 5; Jap. Civil Code, art. 522; Morrell v. Studd, [1913] 2 
 Ch. 648. But in the case of Maclay v. Harvey, 90 111. 525, 530, 32 Am. Kep. 
 35 (1878), where the plaintiff mailed her acceptance two days later than by 
 return mail as requested, the court said : "Appellant seeks to recover upon the 
 strict letter of a special contract, and it is, therefore, incumbent on her to 
 prove such contract, It is required of her, as we have seen, to prove an ac- 
 ceptance of appellee's offer within the time to which it was limited — that is 
 to say, by the placing In the post-oflBce of an answer unequivocally accepting 
 the offer in time for the return mail, which she did not do. Appellee was, 
 thereafter, under no obligation to regard the contract as closed. He might, 
 it is true, have done so, but he was not legally bound in that respect, nor was 
 he legally bound to notify appellant that her acceptance had not been signi- 
 fied within the time to which his offer was limited. She is legally c^.'^rgeable 
 with knowledge that her acceptance was not in time, and in order to fix a 
 liability thereby ™on appellee, it was incumbent upon her, before assuming 
 that appellee waived this objection, to ascertain that he in fact did so." In 
 accord is Ferrier v. Storer, 63 Iowa, 484, 19 N. W. 288, 50 Am. Rep. 752 (1884). 
 
Sec. 7) CONDITIONAL ACCEPTANCE AND REJECTION 95 
 
 sisting of abotit 1,993,000 square meters of land, for the price of its 
 assessed government valuation. B. Valdes." 
 
 There is no dispute that the assessed government vakiation was 307,"- 
 000 pesos, that Legarda owned the land and that Valdes had power to 
 make the offer. On January 17, 1912, Borck wrote to Valdes : ■ 
 
 "In reference to our negotiations regarding" the property in ques- 
 tion, "I offer to purchase said property for the sum of three hundred 
 and seven thousand (307,000.00) pesos, Ph. C, cash, net to you, pay- 
 able the first day of May, 1912, or before and with dehvery of a torrens 
 title free of all encumbrances as taxes and other debts." 
 
 There was dispute about the admissibility of this letter and its being 
 signed, but we see no occasion to disturb the opinion of the Supreme 
 Court that it was a part of the transaction and was admissible. No 
 answer was received, and on January 19 Borck wrote again, saying 
 that he was ready to purchase the property at the price and that full 
 payment would be made on or before March 3, provided all documents 
 in connection with the hacienda were immediately placed at his dispos- 
 al and found in good order. On January 23, Borck wrote again that 
 he could improve the condition of payment and would pay ten days 
 after the documents had been put at his disposal for inspection, etc., 
 and finally, on February 28, wrote that the price was ready to be paid 
 over and requesting notice when it was convenient to allow inspection 
 of all papers. Before this last letter was written Valdes had indicated 
 that he regarded compliance as an open question by saying in conver- 
 sation that he wished to communicate with Mr. Legarda. Subsequent- 
 ly conveyance was refused. 
 
 The letter of January 17 plainly departed from the terms of the of- 
 fer as to the time of payment and was, as it was expressed to be, a 
 counter offer. In the language of a similar English case : 
 
 "The plaintiff made an offer of his own * * * and he thereby 
 rejected the offer previously made by the defendant. * * * j^ ^ag 
 not afterwards competent for him to revive the proposal of the de- 
 fendant, by tendering an acceptance of it." Hyde v. Wrench, 3 Bea- 
 van, 334; Langdell, Cont. § 18. 
 
 We do not find it necessary to gO' into the discussion of the later 
 communications, which led the Supreme Court to the conclusion that 
 they also would not have been sufficient. The right to hold the defend- 
 ant to the proposed terms by a word of assent was gone, and after that 
 all that the plaintiff could do was to make an offer in his turn. It 
 would need a very much stronger case than this to induce us to reverse 
 the decision of the court below. Cardona v. Quinones, 240 U. S. 83, 
 88, 36 Sup. Ct. 346, 60 L. Ed. 538. 
 Judgment affirmed.'" 
 
 60 In accord: Hyde v. Wrench, 3 Beav. 334 (1840); Egger v. Nesbitt, 122 
 Mo. 667, 27 S. W. 385, 43 Am. St. Rep. 596 (1894). 
 
 In Howard Smith & Co. v. Varawa (High Court of Australia) 5 C. L. 
 K. 68 (1907), an offer was made by cable, on the part of the plaintiff; and 
 
96 OFFER AND ACCEPTANCE fCh. 1 
 
 POEL et al. V. BRUNSWICK-BALKE-COLLENDER CO. OP 
 
 NEW YORK. 
 
 (Court of Appeals of New York, 1915. 216 N. Y. 310, 110 N. E. 619.) 
 
 Action by Frans Poel and another, copartners doing business as 
 Poel & Arnold, against the Brunswick-Balke-Collender Company of 
 New York. From an order of the Appellate Division, First Depart- 
 ment (144 N. Y. Supp. 725), and the judgm-ent entered thereon, 
 unanimously affirming a judgment rendered in favor of plaintiffs, de- 
 fendant appeals. Reversed, and new trial granted. 
 
 Seabury, J.*^ In this action the plaintiffs sued to recover damages 
 from this defendant for the breach of an executory contract. ' * * * 
 The theory of the action is that the defendant agreed to accept and pay 
 for certain rubber which the plaintiffs agreed to sell to it, and that the 
 refusal of the defendant to accept and pay for said rubber caused a 
 breach of that contract. * * * 
 
 There are in this case four writings, and upon three of them this 
 controversy must be determined. * * * The writings referred to 
 are as follows: * * * 
 
 New York, April 4; 1910. 
 
 Brunswick-Balke-Collender Co., Long Island City, L,. I. — Gentle- 
 men : Inclosed, we beg to hand you contract for 12 tons Upriver Fine 
 Para Rubber, as sold you to-day, with our thanks for the order. 
 Very truly yours. Poel & Arnold, 
 
 Per W. J. Kelly. 
 
 Inclosed with this letter was the following: 
 
 Apr. 4/ro. 
 Brunswick-Balke-Collender Co., Long Island . City, L. I. 
 
 Sold to You: For equal monthly shipments January to June, 1911, 
 from Brazil and/or Liverpool, about twelve (12) tons Upriver Fine 
 Para Rubber at two dollars and forty-two cents ($2.42) per pound; 
 payable in U. S. gold or its equivalent, cash twenty (20) days from 
 date of delivery here. 
 
 On April 6th Rogers [representing the defendant] sent the follow- 
 ing order to the plaintiffs. It is partly printed and partly written. 
 The part in writing is italicized ; * * * 
 
 after various intervening cable messages, the defendant cabled a conditional 
 acceptance and counter offer at 3:40 p. m. Twenty minutes later, at 4 p. m. 
 the defendant cabled an unconditional acceptance. As to the effect of these 
 messages the court said: "The telegram of 3:40 appears to have arrived at 
 Manila at 5:30 p. m. There was no evidence to show when that of 4 p. m. 
 arrived there. An interesting argument was addressed to us to the effect 
 that the telegram of 3:40 operated from the time of its despatch, and had the 
 effect of a refusal which could not be followed by an acceptance of the orig- 
 inal offer, even if an acceptance of that offer were in fact received before it, 
 and a fortiori if the acceptance were received after the refusal." The court 
 found it unnecessary to pass upon the points 
 01 Parts of' the opinion have been omitted. 
 
Sec. 7) CONDITIONAL ACCEPTANCE AND REJECTION 97 
 
 Long Island City, V<?,. ^910. 
 
 M. Poel and Arnold, 877 Broadway, N. Y. C. Please deliver at once 
 the following, and send invoice with goods: 
 
 About 1£ tons Upriver Fine Para Rubber at 2.4.8 per lb. Bqual 
 monthly shipments January to June, 1911. 
 
 Conditions on Which Above Order is Given. 
 
 Goods on this order must be delivered when specified. In case you 
 cannot comply, advise us by return mail stating earliest date of deliv- 
 ery you can make, and await our further orders. 
 
 The acceptance of this order which in any event you must promptly 
 acknowledge will be considered by us as a guaranty on your part of 
 prompt delivery within the specified time. 
 Terms : F. O. B. 
 
 Respectfully yours, 
 
 The Brunswick-Balke-CoUender Co. of New York. 
 
 The fundamental question in this case is whether these writings con- 
 stitute a cofltract between the parties. If they do not, no question a£ 
 to whether these writings meet the requirements of the statute of 
 frauds need be considered. An analysis of their provisions will show 
 that they do not constitute a contract. It is not contended, and in face 
 of the provisions of the plaintiffs' letter of April 4th it cannot be 
 claimed, that that letter is in itself a contract. It is a mere offer or 
 proposal by the plaintiffs that the defendant should accept the propos- 
 ed contract inclosed which is said to embody an oral order that the 
 defendant had that day given the plaintiffs. The object of this letter 
 was to have the terms of the oral agreement reduced to writing so that 
 there could be no uncertainty' as to the terms of the contract. ' The let- 
 ter of the defendant of April 6th did not accept this offer. If the in- 
 tention of the defendant had been to accept the offer made in the 
 plaintiffs' letter of April 4th, it would have been a simple matter for 
 the defendant to have indorsed its acceptance upon the proposed con- 
 tract which the plaintiffs' letter of April 4th had inclosed. Instead of 
 adopting this simple and obvious method of indicating an intent to ac- 
 cept the contract proposed by the plaintiffs, the defendant submitted 
 its own proposal and specified the terms and conditions upon which it 
 should be accepted. 
 
 The defendant's letter of April 6th was. not an acceptance of this 
 offer made by "the plaintiffs in their letter of April 4th. It was a coun- 
 ter offer or propositioti for a contract. Its provisions make it per- 
 fectly clear that the defendant: (1) Asked the plaintiffs to deliver 
 rubber of a certain quality and quantity at the price specified in desig- 
 nated shipments ; (2) it specified that the order therein given was con- 
 ditional upon the receipt of its order being promptly 'acknowledged; 
 and (3) upon the further condition that the plaintiffs would guarantee 
 delivery within the time specified. It may be urged that the condition 
 
 COBBIN CONT 7 
 
98 . OFFEE AND ACCEPTANCE (Ch. 1 
 
 specified in defendant's order that the plaintiffs would guarantee the 
 delivery of the goods within the time specified added nothing of sub- 
 stance to the agreement, because if the offer was accepted the accept- 
 ance itself would involve this obligation on the part of the plaintiffs. 
 The other condition specified by the defendant cannot be disposed of 
 in the samfe manner. That provision of the defendant's offer provided 
 that the offer was conditional upon the receipt of the order being 
 promptly acknowledged. It embodied a condition that the defendant 
 had the right to annex to its offer. The import of this proposal was 
 that the defendant should not be bpund until the plaintiffs signified 
 their assent to the terms set forth. When this assent was given and 
 the acknowledgment made, this contract was then to come into exist- 
 ence and would be completely expressed in writing. 
 
 The plaintiffs did not acknowledge the receipt of this order and the 
 proposal remained unaccepted. As the party making this offer ~deem- 
 ed this provision material, and as the offer was made subject to com- 
 pliance with it by the plaintiffs, it is not for the court to say that it is 
 immaterial. When the plaintiffs submitted this offer in their letter of 
 April 4th to the defendant, only one of two courses of action was open 
 to the defendant. It could accept the offer made and thus manifest 
 that assent which was essential to the creation of a contract, or it 
 could reject the offer. There was no middle course. If it did not ac- 
 cept the offer proposed it necessarily rejected it. A proposal to accept 
 the offer it modified or an acceptance subject to other terms and con- 
 ditions was equivalent to an absolute rejection of the offer made by 
 the plaintiffs. Mactier's Adm'rs v. Frith, 6 Wend. 103, 21 Am. Dec. 
 262; Vassar v. Camp, 11 N. Y. 441 ; Chicago & G. E. R. Co. v. Dane, 
 43 N. Y. 240; Sidney Glass Works v. Barnes & Co., 86 Hun, 374, 33 
 N. Y. Supp. 508; Mahar v. Compton, 18 App. Div. 536, 540, 45 N. Y. 
 Supp. 1126; Nundy v. Matthews, 34 Hun, 74; Barrow Steamship Co. 
 V. Mexican C. R. Co., 134 N. Y. 15, 31 N. E. 261, 17 L. R. A. 
 359. * * * 
 
 Judgment reversed.'^ ■■ , 
 
 62 In the following cases it was held that there was no contract, for the 
 reason that the acceptance was conditional and not in accord with the terms 
 of the offer: Minneapolis & St. L. R. Co. v. Columbus Rolling Mill, 119 U. S. 
 149, 7 Sup. Ct. 168, 30 L. Ed. 376 (1886) ; Rushing v. Manhattan Idfe Ins. Co. 
 of New York, 224 Fed. 74, 139 C. O. A. 520 (1915) ; McRae v. Ross, 170 Oal. 
 74, 148 Pac. 215 (1915) ; Weishut v. Layton, 5 Boyoe (Del.) 364, 93 Atl. 1057 
 (1915) ; Goodridge v. Wood, 133 111. App. 483 (1907) ; Shane Bros. & Wilson 
 Co. V. Barrett (Ind. App.) 124 N. E. 780 (1919), difference as to time of deliv- 
 ery; Hartford Life Ins. Co. v. Milet, 105 S. W. 144, 31 Ky. Law Rep. 1297 
 (1907) ; Jenness v. Mt. Hope Iron Co., 53 Me. 20 (1864), offer to sell 450 kegs 
 nails is not accepted by ordering 303 kegs; Jordan Bros. Co. v. Walker, 154 
 Mich. 394, 117 N. W. 942 (1908) ; Kraus v. Hansen, 182 Mich. 52, 148 N. W. 373 
 (1914) ; Sterling & Son Co. v. Watson & Bennett Co., 193 Mich. 11, 159 N. W. 
 381 (1916), offer of 4,000 poles is not accepted, if offeree adds "more or less"; 
 Lewis V. Johnson, 123 Minn. 409, 143 N. W. 1127, L. R. A. 1915D, 150 (1913); 
 State V.' Robertson (Mo.) 191 S. W. 989 (1917), insurance policy issued different 
 from the one applied for; Seymour v. Armstrong, 62 Kan. 720, 64 Pac 612 
 (1901) ; Hall v. Olson, 58 Or. 464, 114 Pac. 638 (1911), offer to sell 18,000 acres 
 
Sec. 7) CONDITIONAL |ACCEPTANCE AND REJECTION 99 
 
 BRUCE et al. v. PEARSON. 
 (Supreme Court of New York, 1808. 3 Johns. 534.) 
 
 This was an action of assumpsit, for goods sold and delivered. The 
 cause was tried at the last sittings in New York, before Mr. Justice 
 Van Ness. 
 
 On the 11th December, 1805, the defendant, who resides at Al- 
 bany, wrote a letter to the plaintiffs, who are merchants in the city of 
 New York, as follows: 
 
 "Albany, 11th December, 1805. 
 
 "Gent: Should you find it perfectly agreeable to yourselves, (not 
 otherwise,) you can send me by any sloop, provided you think the 
 river will keep open, the goods I have noted at foot, and payable the 
 15th May next. If you think the time too long, you need not send 
 them." 
 
 The goods mentioned were : "6 hogsheads rum ; 1 hogshead sugar ; 
 1 pipe gin; 1 pipe brandy; 4 quarter-chests hyson-skin tea; 20 or 
 40 small boxes pipes, if low; 10 barrels of codfish." 
 
 The plaintiffs, on the 21st December, 1805, shipped on board of a 
 sloop, for the defendant, "3 hogsheads rum ; 1 pipe brandy ; 2 chests 
 tea; 1 hogshead sugar, and 1 pipe of gin." At the bottom of the 
 bill were these words: "At three months; interest after, till paid." 
 
 They also wrote to the defendant, as follows: 
 
 "Dear sir: Your much esteemed favour of the 11th inst. we only 
 received on the 19th. We were much at a loss to know how to act; 
 we, however, have calculated to risk the getting up, and have reduced 
 the order, and shipped per the Fair Play, as on the other side." 
 
 The vessel having the goods on board, (the river being much ob- 
 structed with ice,) was, during' her passage, cast away, and part of 
 |he goods 'wholly lost. The master, on the 8th January, 1806, hav- 
 ing left the vessel, went to Albany, and delivered the letter of the plain- 
 tiffs to the defendant, who, havi«g read it, said that he did not consider 
 the goods as his, as the plaintififs had not sent all the goods ordered, 
 nor on the terms proposed. On the same day, the defendant wrote 
 to the plaintiffs, informing them, that the vessel was ashore, and that 
 he did not- consider the goods at his risk, and advising them to give di- 
 
 of land with warranty of 40 million feet of timber — acceptance, subject to a 
 "cruise" showing warranty correct; Jordan v. Norton (Ex.) 4 M. & W. 153 
 (1838) ; Duke v. Andrews, 2 Ex. 290 (1848), application for shares not accepted 
 by allotting "nontransferable" shares ; Orossley v. Maycock, L. R. 18 Eq. Oas. 
 180 (1874) ; Carter v. Bingham, 32 Up. Can. 615 (18T2). 
 
 Where the offer requires acceptance in a particular form, an acceptance in 
 a different form is inoperative, even though the legal relations that would be 
 created by it are identical with those that would be created by the required 
 form. Phoenix Iron & Steel Co. v. Wilkoffi Co., 253 Fed. 165, 165 O. C. A. 65, 
 1 A. L. E. 1497 (1918). 
 
 "An acceptance may be complete, though it expresses dissatisfaction at 
 some of the terms, if the dissatisfaction stops short of dissent, so that the 
 whole thing be described as a 'grumbling assent.' " Pollock, Contracts; John- 
 son V. Federal Union Surety Co., 187 Mich. 454, 153 N. W. 788, 792 (1915). 
 
100 OFFER AND ACCEPTANCE . (Ch. 1 
 
 rections for their preservation, oflfering, if the plaintiflfs considered 
 him as liable, to leave the questi6n to be decided by arbitrators. 
 
 The goods were charged at the market price of goods, at three 
 months credit. 
 
 The plaintiffs offered to prove, that the defendant had frequently, 
 prior to the 11th December, 1804, sent orders to the plaintiffs for 
 goods, which were executed only in part, and that the defendant had 
 always received the goods sent, without making any objection; and 
 that it was a general usage among merchants in the city of New 
 York, to send to their customers in the country, a part only of the 
 goods ordered; but this evidence was objected to, and overruled. 
 The judge was about to order the plaintiffs to be called, when the 
 counsel agreed that a verdict might be taken for the plaintiffs, sub- 
 ject to the opinion of the court on a case containing the facts above 
 stated ; and .that, if the opinion of the court . should be in favour of 
 the defendant, a nonsuit should be entered. 
 
 Per Curiam. The order sent by the defendant to the plaintiffs, was 
 for 6 hogsheads of rum, and other articles, at a credit of six months ; 
 and the plaintiffs sent only 3 hogsheads, and omitted part of the other 
 articles, charging those sent, at a credit of three months. This can- 
 not amount to a contract. There is no agreement, no aggregatio meri- 
 tium between the parties, as to the thing, or subject-matter of the 
 contract. The defendant wished to have the whole of the goods; 
 a part of them might be of no use ; and until he assented to receive 
 a part instead, of the whole, he cannot be said to have contracted to 
 pay for a part; and there can be no implied assumpsit to pay, as the 
 goods sent never came to his hands. 
 
 Judgment of nonsuit. 
 
 GENERAL LITHOGRAPHING & PRINTING CO. v. WASH- 
 INGTON RUBB^ CO., Inc. 
 (Supreme Court of Washington, 1903. 55 Wash. 461, 104 Pac. 650.) 
 
 Action by the General Lithographing & Printing Company against 
 the Washington Rubber Company, Incorporated, for breach of con- 
 tract. From a judgment for plaintiff, defendant appeals. Affirmed! 
 
 Parker, J.*^ The facts in this cause as found by the court, the trial 
 being by the court without a jury, are in substance as follows : 
 
 About June 24, 1907, the plaintiff and Mix Fire Apparatus Com- 
 pany entered into a contract, whereby the former agreed to perform 
 the work and furnish material for the printing of 3,500 copies of a cat- 
 alogue for the latter at the agreed price of $800. In pursuance of the 
 terms of the contract, the plaintiff proceeded with the work, when 
 the Mix Fire Apparatus Company requested plaintiff not to com- 
 plete same .until further orders, and thereupon plaintiff held tlie print- 
 
 6 3 Part of the opinion is omitted. 
 
Sec. 7) CONDITIONAL ACCEPTANCE AND REJECTION ib^' 
 
 ed forms for the work for a period of two months, for which it was 
 entitled to $50 as a reasonable charge for the holding of the forms. 
 On the 15th' day of November, 1907, in consideration of the release 
 and' discharge by the plaintiif of said claim of $50 for holding the 
 forms, and a continuation and completion of the contract as originally 
 made, the defendant entered into a contract in writing whereby plain- 
 tiff was to complete the catalogue, and the defendant was to accept 
 and pay for the same. In pursuance of this last contract, the plain- 
 tiff proceeded to perform the same and submitted proofs for correc- 
 tion to defendant preparatory to final printing, but' defendant wholly 
 failed and refused to correct and return said proof, and refused to 
 allow the work to proceed or to fulfill the terms of the contract on 
 its part. The reasonable value of the work and labor in and about 
 the composition performed by plaintiff is $200. The reasonable value 
 of labor incident to the furnishing of proof to defendant is $2S. The 
 depreciation in the value of paper purchased by plaintiff for the work, 
 and left on hand is $100, and the profit plaintiff would have made upon 
 the contract had it been allowed to complete the same is $200. 
 
 From these facts the court concluded as a matter of law that plain- 
 tiff was entitled to recover from defendant $525, and rendered judg- 
 ment accordingly, from which defendant has appealed. 
 
 Appellant, having filed its exceptions to the court's findings, con- 
 tends that there was no contract shown by the evidence to have been 
 entered into between the parties, the breach of which would warrant 
 a recovery. The contract referred to in the court's findings as being 
 entered into between the appellant and respondent is evidenced by two 
 letters as follows: 
 
 "Seattle, Wash., 11 — 6 — 07. General Lithographing & Printing 
 Co., City — Gentlemen: Referring to the writer's conversation with 
 your Mr. Graff about six weeks ago, at which time he proposed to him 
 that the Washington Rubber Co. would be willing to assume the pay- 
 ment of $800.00 for the catalogue ordered from his Company by the 
 Mix Fire Apparatus Co. on delivery of said catalogue in accord- 
 ance with the contract, as placed, we herewith confirm said offer on 
 condition that there will be no additional charges beyond the original 
 contract price of Eight Hundred Dollars ($800.00). Kindly advise us 
 what decision you have come to on this offer and oblige, Yours re- 
 spectfully. The Washington Rubber Co., by Franz F. Richter, Pr." 
 
 "Nov. 15, 1907. Washington Rubber Co., 216 Jackson St., City- 
 Gentlemen: In answer to your letter dated November 6th, 1907, 
 we beg to accept your proposition with the understanding that we are 
 to have $800.00 for the catalogue printed as originally agreed, and 
 no changes to be made in your copy or corrections except at your 
 expense. The job has been set and waiting for you at some time, 
 ready to run. We believe there will be no changes necessary but in 
 case there are, we will expect $1.25 per hour for composition changes. 
 Yours truly. General Lithographing &• Printing Co." 
 
102 OFFER AND ACCEPTANCE (Ch. 1 
 
 Counsel for appellant argue that the language of the second let- 
 ter does not constitute an unconditional acceptance of the proposi- 
 tion contained in the first letter because of the words therein : "And no 
 changes to be made in your copy or corrections except at your ex- 
 pense." There may be room for argument as to whether or not 
 these words so qualify the acceptance as to make it conditional, and 
 thereby prevent the meeting of the minds of the parties. We are 
 not inclined to so regard it ; but rather as a statement indicating that 
 there would be extra charge for any extra work beyond the strict 
 terms of the contract. The latter part of the letter lends support to 
 this view. However, this involves only a question of construction, 
 which we are relieved from solving if as a matter of fact the parties 
 subsequently treated the contract as existing. Mr. Graff, the pres- 
 ident of respondent company, referring to a time immediately fol- 
 lowing- the exchange of the letters, testified : "We immediately took 
 new proofs as requested. Mr. Richter told me to go ahead with the 
 work and to furnish new proofs for Mr. Mix to correct, which we 
 did." If this be true, and we think the trial court was warranted 
 in so believing from the evidence, it at once becomes apparent that 
 both parties regarded the contract as complete. * * * 
 
 The judgment is affirmed. 
 
 STEVENSON, JAQUES & CO. v. McLEAN. 
 
 (In the High Court of Justice, Queen's Bench Division, 1880. L. R. 5 
 
 Q. B. D. 346.) 
 
 IyUSH, J. This is an action for non-delivery of a quantity of iron 
 which it was alleged the defendant contracted to sell to the plaintiffs 
 at 40s. per ton, net cash. The trial took place before me at the last 
 assizes at Leeds, when a verdict was given for the plaintiffs for 
 £1900, subject to further consideration on the question whether, under 
 the circumstances, the correspondence between the parties amounted 
 to a contract, and subject also, if the verdict should stand, to a ref- 
 erence, if required by the defendant, to ascertain the amount of dam- 
 ages. The question of law was argued before me on May 7th 
 last. 
 
 The plaintiffs are makers of iron and iron merchants at Mid- 
 dlesborough. The defendant being possessed of warrants for iron, 
 which he had originally bought of the plaintiffs, wrote on September 
 24th to the plaintiffs from London, where he carries on his business : 
 "I see that No. 3 has been sold for immediate delivery at 39s., which 
 means a higher price for warrants. Could you get me an offer for the 
 whole or part of my warrants ? I have 3800 tons, and the brands you 
 know." 
 
 On the 26th one of the plaintiffs wrote from Liverpool: "Your 
 letter has followed me here. The pig-iron trade is at present very 
 excited, and it is difficult to decide whether the prices will be main- 
 
Sec. 7) CONDITIONAL ACCEPTANCE AND REJECTION 103 
 
 tained or fall as suddenly as they have advanced;' Sales are being 
 made freely for forward delivery chiefly, but not in warrants. It 
 may, however, be found advisable to sell the warrants as maker's 
 iron. I would recomrnend you to fix your price, and if you will write 
 me your limit to Middlesborough, I shall probably be able to wire 
 you something definite on Monday." This letter was crossed by a 
 letter written on the same day by the clerk of one Fossick, the de- 
 fendant's broker in London, and which was in these terms : 
 
 "Referring to R. A. McLean's letter to you re warrants, I have 
 seen him again to-day, and he considers 39s. too low for same. At 
 40s. he says he would consider an offer. However, I shall be obliged 
 by your kindly wiring me, if possible, your best offer for all or part 
 of the warrants he has to dispose of." 
 
 On the 27th (Saturday) the plaintiffs sent to Fossick the following 
 telegram : 
 
 "Cannot make an offer to-day; warrants rather easier. Several 
 ■ sellers think might get 39s. 6d. if you could wire firm offer subject 
 reply Tuesday noon." 
 
 In answer to this Fossick wrote on the same day: "Your telegram 
 duly to hand re warrants. I have seen Mr. McLean, but he is not 
 inclined to make a firm offer. I do not think he isJikely to sell at 
 39s. 6d., but will probably prefer to wait. Please let me know imme- 
 diately you get any likely offer." 
 
 On the same day the defendant, who had then received the Liver- 
 pool letter of the 26th, wrote himself to the plaintiffs as follows : 
 
 "Mr. Fossick's clerk showed me a telegram from him yesterday 
 mentioning 39s. for No. 3 as present price, 40s., for forward deliv- 
 ery. I instructed the clerk to wire you that I would now sell for 40s., 
 net cash, open till Monday." No such telegram was sent by Fossick's 
 clerk. 
 
 The plaintiffs were thus on the 28th (Sunday) in possession of 
 both letters, the one from Fossick stating that the defendant was 
 not inclined to make a firm offer; and the other from the defendant 
 himself, to the effect that he would sell for 40s., net cash, and would 
 hold it open all Monday. This it was admitted must have been the 
 meaning of "open till Monday." 
 
 On the Monday morning, at 9 :42, the plaintiffs telegraphed to the 
 defendant: "Please wire whether you would accept forty for delivery 
 over two months, or if not, longest limit you would give." 
 
 This telegram was received at the office at Moorgate at 10 :01 a. m., 
 and was delivered at the defendant's office in the Old Jewry shortly 
 afterward. 
 
 No answer to this telegram was sent by the defendant, but after 
 its receipt he sold the warrants, through Fossick, for 40s., net cash, 
 and at 1 :25 sent off a telegram to the plaintiffs : "Have sold all my 
 warrants here for forty net to-day." This telegram reached Middles- 
 borough at 1 :46, and was delivered in due course. 
 
104 OFFER ANP ACCEPTANCE (Ch. 1 
 
 Before its arrival at Middlesborough, however, and at 1:34, the 
 plaintififs telegraphed to defendant : "Have secured your price for 
 payment next Monday — write yoU fully by post." 
 
 By the usage of the iron market at Middleshorough, contracts made 
 on a Monday for cash are payable on the following Monday. 
 
 At 2 :06 on the same day, after receipt of the defendant's telegram 
 announcing the sale through Fossick, the plaintiffs telegraphed: 
 "Have your telegram following our advice to you of sale, per your 
 instructions, which we cannot revoke, but rely upon your carrying 
 out." 
 
 The defendant replied: "Your two telegrams received, but your 
 sale was too late; your sale was not per my instructions." And to 
 this the plaintiffs rejoined : "Have sold your warrants on terms stated 
 in your letter of 27th." 
 
 The iron was sold by plaintiffs to one Walker at 41s. 6d., and the 
 contract note was signed before 1 o'clock on Monday. The price of 
 iron rapidly rose, and the plaintiffs had to buy in fulfilment of their ■ 
 contract at a considerable advance on 40s. , 
 
 The only question of fact raised at the trial was, whether the re- 
 lation between the parties was that of principal and agent, or that 
 of buyer and seller. The jury found it was that of buyer and seller, 
 and no objection has been taken to this finding. 
 
 Two objections were relied on by the defendant : First, it was con- 
 tended that the telegram sent by the plaintififs on the Monday morn- 
 ing was a rejection of the defendant's offer and a new proposal on the 
 plaintiffs' part, and that the defendant had therefore a right to regard 
 it as putting ah end to the original negotiation. 
 
 Looking at the form of the telegram, the time when it was sent, 
 and the state of the iron market, I cannot think this is its fair meaning. 
 The plaintiff Stevenson said he meant it only as an inquiry, expecting 
 an answer for his guidance, and thjs, I think, is the sense in which the 
 defendant ought to have regarded it. 
 
 It is apparent throughout the correspondence, that the plaintiffs 
 did not contemplate buying the iron on speculation, but that their 
 acceptance of the defendant's offer depended on their finding some one 
 to take the warrants off their hands. All parties knew that the 
 market was in an unsettled state, and that no one could predict at 
 the early hour when the telegram was sent how the prices would 
 range during the day. It was reasonable that, under these circum- 
 stances, they should desire to know before business began whether 
 they were to be at liberty in case of need to make any and what con- 
 cession as to the time or times of delivery, which would be the time 
 or times of payment, or whether the defendant was determined to 
 adhere to the terms of his letter ; and it was highly unreasonable that 
 the plaintiffs should have intended to close the negotiation while it 
 was uncertain whether they could find a buyer or not, having the 
 whole of the business hours of the day to look for one. Then, again. 
 
Sec. 7) CONDITIONAL ACCEPTANCE AND REJECTION 105 
 
 the form of the telegram is one of inquiry. It is not "I offer forty for 
 deUvery over twf months," which would have likened the case to 
 Hyde v. Wrench [3 Beav. 334], where one party offered his estate for 
 il,000, and the other answered by offering £950. Lord Langdale, 
 in that case, held that after the £950 had been refused, the party 
 offering it could not, by then agreeing to the original proposal, claim 
 the estate, for the negotiation was at an end by the refusal of his 
 counter proposal. Here there is no counter proposal. The words 
 are, "Please wire whether you would accept forty for delivery over 
 two months, or, if not, the longest limit you would give." There 
 is nothing specific by way of offer or rejection, but a mere inquiry, 
 which should have been answered and not treated as a rejection of the 
 offer. This ground of objection therefore fails. 
 
 The remaining objection was one founded on a well-known passage 
 in Pothier, which has been supposed to have been sanctioned by the 
 Court of Queen's Bench in Cooke v. Oxley [3 T. R. 653], that 
 in order to constitute a contract there must be the assent or con- 
 currence of the two minds at the moment when the offer is accepted; 
 and that if, when an offer is made, and time is given to the other 
 party to determine whether he will accept or reject it, the proposer 
 changes his mind before the time arrives, although no notice of the 
 withdrawal has been given to the other party, the option of accept- 
 ing it is gone. The case of Cooke v. Oxley does not appear to me 
 to warrant the inference which has been drawn from it, or the sup- 
 position that the judges ever intended to lay down such a doctrine. 
 The declaration stated a proposal by the defendant to sell to the 
 plaintiff 266 hogsheads of sugar at a specific price, that the plaintiff 
 desired time to agree to, or dissent from, the proposal till four in 
 the aftern6on, and that defendant agreed to give the time, and prom- 
 ised to sell and deliver if the plaintiff would agree to purchase and 
 give notice thereof before 4 o'clock. The court arrested the judgment 
 on the ground that there was no consideration for the defendant's 
 agreement to wait till 4 o'clock, and that the alleged promise to wait 
 was nudum pactum. ' 
 
 All that the judgment affirms is, that a party who gives time to 
 another to accept or reject a proposal is not bound to wait till the 
 time expires. And this is perfectly consistent with legal principles 
 and with subsequent authorities, which have been sifpposed to con- 
 flict with Cooke v. Oxley. It is clear that a unilateral promise is 
 not binding, and that if the person who makes an offer revokes it 
 before it has been accepted, which he is at liberty to do, the negotia- 
 tion is at an end. See Routledge v. Grant [4 Bing. 653]. But in 
 the absence of an intermediate revocation, a party who makes a pro- 
 posal by letter to another is considered as repeating the offer every 
 instant of time till the letter has reached its destination and the cor- 
 respondent has had a reasonable time to answer it. Adams v. Lind- 
 sell [1 B. & Aid. 681]. "Common sense tells us," said Lord Gotten- 
 
106 OFFER AND ACCEPTANCE (Ch. 1 
 
 ham, in Dunlop v. Higgins' [1 H. L. C. 381], "that transactions cannot 
 go on without such a rule." It cannot make any c^fference whether 
 the negotiation is carried on by post, or by telegraph, or by oral mes- 
 sage. If the offer is not retracted, it is in force as a continuing offer 
 till the time for accepting or rejecting it has arrived. But if it is re- 
 tracted, there is an end of the proposal. Cooke v. Oxley [3 T. R. 653], 
 if decided the other way, would have negatived the right of the pro- 
 posing party to revoke his offer. / 
 
 Taking this to be the effect of the decision in Cooke v. Oxley, the 
 doctrine of Pothier before adverted to, which is undoubtedly contrary 
 to the spirit of English law, has never been affirmed in our courts. 
 Singularly enough, the very reasonable proposition that a revocation is 
 nothing till it has been communicated to the other party, has not, until 
 recently, been laid down, no cas6 having apparently arisen to call 
 for a decision upon the point. In America it was decided some years 
 ago that "an offer cannot be withdrawn unless the withdrawal reaches 
 the party to whom it is addressed before his letter of reply announc- 
 ing the acceptance has been transmitted." Tayloe v. Merchants' Fire 
 Insurance Co. [9 How. 390] ; and in Byrne & Co. v. Leon Van Tien- 
 hoven & Co. [49 L. J. (C. P.) 316], my brother Lindley, in an elab- 
 orate judgment, adopted this view, and held that an uncommunicated 
 revocation is, for all practical purposes and in point of law, no rev- 
 ocation at all. 
 
 It follows, that as no notice of withdrawal of his offer to sell at 
 40s., net cash, was given by the defendant before the plaintiffs sold 
 to Walker, they had a right to regard it as a continuing offer, and 
 their acceptance of it made the contract, which was initiated by the 
 proposal, complete and binding on both parties. 
 
 My judgment must, therefore, be for the plaintiffs for i 1,900, but 
 this amount is liable to be reduced by an arbitrator to be agreed on 
 by the parties, or, if they cannot agree within a week, to be nom- 
 inated by me. If no arbitrator is appointed, or if the amount be not 
 reduced, the judgment will stand for £1,900. The costs of the ai*- 
 bitration to be in the arbitrator's discretion. 
 
 Judgment for the plaintiffs."* 
 
 '* "A mere inquiry as to tlie terms of the proposal, or a request to modify 
 or change the offpr, does not have the effect of rejecting the offer, and, if the 
 offer has not been revoked, a party may accept it, although he previously 
 asked the proposer to modify it." Johnson v. Federal Union Surety Co., 187 
 Mich. 454, 153 N. W. 788 (1915). 
 
 See, also, in accord, Simpson v. Hughes, 66 L. J. Ch. 334 (1897) ; Dunlop 
 V. Higgins, 1 H. L. C. 381 (1848). 
 
Sec. 7) CONDITIOKAL ACCEPTANCE AND REJECTION 107 
 
 PURRINGTON v. GRIMM. 
 (Supreme Court of Vermont, 1910. S3 Vt. 466, 76 Atl. 158.) 
 
 Action by Frank G. Purrington against Gustave H. Grimm. From 
 a judgment for defendant, plaintiff brings exceptions. Reversed and 
 remanded. 
 
 MuNSON, J.*^ The suit is to recover damages for the non-delivery ol 
 goods purchased. The defendant denies that there was a sale. The 
 question is whether certain correspondence shows a contract. 
 
 The defendant was engaged in the manufacture and sale of sugar 
 utensils and supplies. The plaintiff, wishing to fit up his sugar place 
 for tbe making of maple sugar, applied to the defendant by letter for 
 his catalogue of evaporators and sugaring utensils. The defendant re- 
 plied, inclosing a price list of evaporators, and stating that he had mail- 
 ed him a catalogue, and that if he would place an order by return mail 
 and pay on delivery he would allow him a special discount of 10 per 
 cent., or that he might purchase at regular price by paying one-half 
 cash May 1st and the balance in one year. Plaintiff acknowledged re- 
 ceipt of the catalogue, and inquired the prices of evaporators of two 
 specified sizes. Defendant replied, giving prices of such sized evap- 
 orators with arch complete, including chimney, grate bars, etc., and 
 saying that if plaintiff would send cash with order he would allow him 
 a discount of 5 per cent. : that his regular terms were one-half cash 
 May 1st and balance in one year ; and that if he bought on those terms 
 the price -would be iiet. 
 
 February 13th plaintiff wrote defendant proposing to buy an evap- 
 orator of a specified size and quality, an eight-barrel store tank of a 
 certain description, 300 No. 4 spouts with hooks, and 300 galvanized 
 iron buckets of $16 quality, if the defendant would give three years' 
 time, first payment to be made May 1, 1907. February 16th defend- 
 ant wrote plaintiff that he would accept his order and make out three 
 notes of equal payments May 1, 1907, 1908, and 1909, but saying that 
 he had no galvanized buckets of the $16 quality, and that the only 
 thing he could give him was his best bucket, selling for $24 per 100, 
 or I. C. Coke tin buckets, for $18 per 100. To this plaintiff replied 
 under date of February 18th : "Would say of the buckets that you may 
 send us 300 AAAA 14 bright charcoal tin buckets, also a '/le-inch 
 tapping bit and %-inch reamer" — concluding with a request that he 
 ship as soon as possible, and thanking him for the extra time allowed. 
 Defendant did not ship the goods, and after repeated communications 
 of inquiry wrote plaintiff, under date of March 19th, that he could not 
 ship them because the information he had regarding plaintiff's financial 
 standing was not satisfactory. It appears that the buckets mentioned 
 in plaintiff's letter of February 18th were the same as the $18 bucket 
 mentioned in the defendant's last preceding letter, and that the tapping 
 
 65 Part of tie opinion is omitted. 
 
108 OFFER AND ACCEPTANCE (Ch. 1 
 
 bit and reamer first mentioned in plaintiff's letter of February 18th to- 
 gether cost 75 cents. These facts, with the letters, make the case. The 
 court directed a verdict for the defendant, on the ground that the plain- 
 tiff had not proved a contract. 
 
 It is argued in support of the judgment that the letters say nothing 
 about the price of some of the articles Ordered. It was not necessary 
 that they should. It is evident from the correspondence that the par- 
 ties were negotiating on the basis of a price list ; the defendant offer- 
 ing a discount for cash, and the plaintiff seeking a longer time of cred- 
 it at regular prices. When this was settled, the price list would deter- 
 mine the amount of the purchase. It is said that the giving of notes 
 was first referred to in defendant's letter of February 16th, and that 
 the plaintiff's letter of February 18th contains no agreement to give 
 them. We think the plaintiff's agreement to the proposed change in 
 the list ordered with thanks for the extra time allowed for payment, 
 was an implied assent to the manner in which it was proposed that the 
 terms of payment should be evidenced. It is said that the defendant 
 nowhere proposed to sell plaintiff 300 buckets. His whole correspond- 
 ence was an offer to supply the defendant, and his letter of February 
 16th plainly gave the plaintiff his chpice between two kinds of buckets 
 then in stock. It is said that in the plaintiff's letter regarding the 
 buckets the other articles previously mentioned in the negotiation were 
 entirely omitted. It was not necessary that the previous steps in the 
 negotiation should be recited in each succeeding letter. °° Plaintiff's 
 letter of February 13th was a proposal to buy a specified list of goods 
 if the defendant would give a certain period of credit. Defendant's 
 letter of February 16th agreed to give the credit asked for, but pro- 
 posed a substitution of one grade of goods for another as to a part of 
 
 66 In C. W. Hull Co. V. Marquette Cement Mfg. Co., 208 Fed. 260, 264, 125 
 0. O. A, 460 (1913), tlie court said: "Counsel for appellant builds up an im- 
 posing argument in this way : He starts witH the basic principle that in order 
 to create a contradt there must be a definite proposal on one side and an un- 
 conditional acceptance on the other. He then takes up the letters and shows 
 that each ofEer was met by some new term and, applying his rule, lays aside 
 each letter as a nullity because it failed to produce a complete agreement. 
 Parties, however, have the right to reach their agreements in their own way. 
 They may settle upon one term at a time, and, if it is reasonably clear that 
 this has been their method, then, when the last term is agreed upon, their 
 contract is just as complete and binding as if all its terms had been settled 
 by a single act. Here the parties first agree upon territory, then upon quan- 
 tity, then upon general features, such as terms of payment, return of sacks, 
 etc., then upon the amount of the monthly deliveries, and finally upon the 
 price. At every stage, as the negotiations advance, it seems clear to us that 
 the parties carry forward the terms as to which they have already agreed." 
 See, also, Kehlor Flour Mills Co. v. Linden, 230 Mass. 119, 119 N. E. 698 
 (1918). 
 
 In Dougherty v. Briggs, 231 Pa. 68, 75, 79 Atl. 924 (1911), the court said: 
 "When it is sought to establish a contract by letters wluch pass between the 
 parties, containing proposals, answers and counter proposals, it must be made 
 to appear that at some point in the correspondenfee there was a definite and 
 unqualified proposal by one party which was unconditionally and Without 
 qualification accepted by the other party." 
 
Sec. 7) CONDITIONAL ACCEPTANCE AND REJECTION 109 
 
 the order. Plaintiff's letter of February 18th agreed to the proposed 
 change. It is plain that these three, letters resulted in an agreement, 
 unless this was prevented by plaintiff's mention of the bit and reamer. 
 
 It is certain that an acceptance which varies from the offer will not 
 conclude a contract. Davenport v. Newton, 71 Vt. 11, 21,' 42 Atl. 
 1087. But the reply may go beyond the terms of the proposal without 
 qualifying the acceptance. Thp addition' may be such as fairly to im- 
 port a request instead of a condition. In determining what one party 
 intended, and the other ought to have understood, regard must be had 
 to the situation and purpose of the parties, and the subject-matter and 
 course of the negotiations. These parties, had been negotiating regard- 
 ing the substantial outfit of a sugar orchard, with proposals and coun- 
 ter-proposals induced by the condition of the defendant's stock and the 
 plaintiff's desire tONsecure a longer term of credit. This negotiation 
 was brought to an agreement by plaintiff's letter of February 18th, un- 
 less it was held open by the introduction of a new subject-matter — the 
 tapping bit and reamer. The language of this letter is not so complete 
 and exact as to leave no room for construction. If the meaning is that 
 the defendant might make the proposed substitution of buckets provid- 
 ed he would add to the shipment a bit and a reamer, there was no con- 
 tract. But we think the purport of the letter is the same as if the 
 plaintiff had written : "You may also put in, if you have them on hand, 
 a tapping bit and reamer." It seems clear that, if the defendant had 
 shipped the goods without the bit and reamer, the plaintiff could not 
 have refused to take them on the ground that those articles were 
 omitted. 
 
 There are a few cases somewhat in point. In Culton v. Gilchrist, 
 92 Iowa, 718, 61 N. W. 384, plaintiff wrote defendant that he would 
 lease to him for three or five years as he might choose. Defendant 
 thereupon wrote plaintiff that he might make out a lease for five years ; 
 that his reason for wanting the place for five years was that he would 
 like to put up a small cookroom ; that he would like to do this himself, 
 if the plaintiff would give him in the lease the privilege of removing 
 the addition if he did not buy the place. It was held that the accept- 
 ance was complete; that the matter subsequently introduced was not 
 a condition, but a request. * * * 
 
 Judgment reversed.' 
 
 67 
 
 6 7 In accord: Simpson v. Emmons, 116 Me. 14, 99 Atl. 658 (1917), a request 
 to "rush shipment" does not Invalidate acceptance; Wllklns v. Vass Cotton 
 Mills, 176 N. O. 73, 97 S. E. 151 (1918), "accept offer ; make it 25,000 if can 
 make sisteens," held valid ; Turner v. McCormick, 56 "W. Va. 161, 49 S. E. 28, 
 67 L. K. A. 853, 107 Am. St. Eep. 904 (1904), "respectfully request you to make 
 delivery of deed in Morgantown" ; Oulton v. Gilchrist, 92 Iowa, 718, 61 N. W. 
 384 (1894), acceptance of lease, with request to build a small cook room; 
 Portage Rubber Co. v. Fruin Drop Forge Co., 186 111. App. 11 (1914). 
 
110 OFPEE AND AOCBPTANCK (Ch. 1 
 
 WHEATON BUILDING & LUMBER CO. v. CITY OF BOSTON. 
 (Supreme Judicial Court of Massachusetts, 1910. 204 Mass. 218, 90 N. E. 598.) 
 
 Action by the Wheaton Building & Lumber Company against the 
 City of Boston. There was a verdict for defendant, and plaintiff 
 brings exceptions. Overruled. 
 
 RuGG, J.'^ The plaintiff in common with several others, in response 
 to an advertisement issued by the schoolhouse commissioners of Boston, 
 submitted a bid for the erection of a certain schoolhouse, transmitting 
 with it a check to the order of defendant for $2,000. The city claims 
 the right to hold this money Gpon these facts : The bid contained the 
 provision that the plaintiff "proposes and agrees that if within 20 days' 
 after the day named below for leaving the proposal, notice that this 
 proposal will be accepted for the city shall be mailed to him at the ad- 
 dress given below or shall be delivered to him, he will at 11 o'clock 
 a. m. of some day of the six week days next after such mailing or de- 
 livery * * * deliver * * * g^ contract and bond for doing 
 the w.ork properly executed in the form annexed, * ' * * and also 
 agrees that the certified check payable to the city left herewith is the 
 property of the city, and the amount thereof is the amount of damages 
 which the city will sustain by failure to carry out the proposal, but if 
 this proposal is not accepted or if notice is mailed and delivered, and 
 the undersigned executes and delivers said contract and bond the check 
 or its amount is to be paid to him on receipt therefor." 
 
 The bid of the lowest bidder was accepted, but he declined to exe- 
 cute a contract, and the city forfeited his check. Thereupon, the pro- 
 posal of the plaintiff, being the next lowest, was accepted by letter mail- 
 ed within the time limited in the bid, and it refused to execute a con- 
 tract. The proposal of the next lowest bidder was then accepted, but 
 he refused to execute the contract, and his check \yas taken by the city. 
 Between these three bids and the next lowest was a gap of about $24,- 
 000, and his proposal being accepted, he executed a contract. The 
 plaintiff did not attempt to withdraw its proposal until after it had been 
 accepted by the schoolhouse commission. 
 
 1. It is urged that the acceptance of one bid by the city constituted 
 a rejection of all the other bids, and that hence the attempted accept- 
 ance of the plaintiff's bid was of no effect. Undoubtedly an advertise- 
 ment and proposal might be so framed as to sustain such contention. 
 But that is not the effect of the acts of the defendant and the statute 
 under which they were performed. The terms of the proposal as to 
 the time during which it was to remain open indicate that tlie city in- 
 tended to reserve to itself time to make at least three attempts to hold 
 bidders before its rights should have expired. St. 1890, p. 370, c. 
 418, required the execution of a formal written contract in addition to 
 the acceptance of the proposal. The acceptance of the bid by the school- 
 
 6 8 Part of the opinion is omitted. 
 
Sec. 7) CONDITIONAL ACCEPTANCE AND REJECTION HI 
 
 house commissioners did not of itself constitute a formal contract. 
 The city could not be bound under the statute until the formal con- 
 tract was executed. Edge Moor Bridge Works v. Bristol, 170 Mass. 
 528, 49 N. E. 918. The only way in which the city could secure a bind- 
 ing agreement for the construction of its building was through such a 
 written contract. But it is plain that the statute contemplated some 
 obligation on the part of the bidders, even though there was none on 
 the part of the city. St. 1890, c. 418, § 5, provides that "every pro- 
 posal * * * shall ,be accompanied by a suitable bond, certified 
 check or certificate of deposit for the faithful performance of such 
 proposal. * * * » This section must be given a reasonable effect. 
 It would be a nullity if it should be held that the bidder was at liberty 
 to wjthdraw without any liability at any time before the formal con- 
 tract, which alone could bind the city, should be executed. The reason- 
 able construction is to hold that the bidder is bound to stand by his 
 proposal, at least after its acceptance, and to the extent of his bond or 
 deposit, but no further. 
 
 If thte case was free from statutory regulation, and it did not appear 
 that a more formal contract was contemplated, the mere acceptance of 
 the proposal would constitute a contract, and neither party could re- 
 fuse to carry it out without becoming liable to all the damage sustain- 
 ed. Beach & Clarridge. Co. v. American Steam Gauge & Valve Mfg. 
 Co., 202 Mass. 177, 88 N. E. 924. The Legislature, perhaps in recog- 
 nition of the hardship, which might follow requiring the bidder to be 
 bound though the city Was not, restricted the liability of the former 
 to the extent of the deposit. From this interpretation of the statute it 
 follows that an acceptance of the proposal of one bidder did not con- 
 stitute a binding contract even on the part of the bidder to execute a 
 formar contract, but only to forfeit his deposit if he failed to do sO. 
 The proposal stated that the bid should remain open a definite number 
 of days, not until some one of the bids should be accepted. The ac- 
 ceptance of a bid was only one step toward the execution of the con- 
 tract. The bidder first accepted might be unable to secure the required 
 bond for the performance of the contract. The mayor might for some 
 just reason refuse to approve the contract, or some other cause might 
 intervene to prevent the execution of a final contract. The tenor of 
 the proposal, which was upon a blank furnished by the defendant, 
 read in the light of the statute, indicates an -intent that the city re- 
 serves all its rights under all the bids until a contract shall have been, 
 formally executed and delivered, and to hold all the bidders to the 
 terms of their proposals until it has either rejected all of them as pro- 
 vided in St. 1890, c. 418, § 4, or become bound by the execution of a 
 contract with one, or the time limited for acceptance has expired. 
 Hence the acceptance of a bid without the execution of a contract can- 
 not be regarded as an unequivocal and definite determination on the 
 part of the city to consider no other proposal. So long as the time 
 limited for the deposit to remain had not expired and no formal con- 
 
112 OFFER AND ACCEPTANCE (Ch. 1 
 
 tract had been executed, the city was at liberty to accept any proposal, 
 and require the bidder to respond either by signing the contract or 
 sustaining the loss of the defjosit. Gibson v. Owens, 115 Mo. 258, 21 
 S. W. 1107. 
 
 2. It is next argued by the plaintiff that, the city's acceptance ©f fhe 
 bid being made subject to the approval of the mayor, there was not an 
 unconditional acceptance of the terms of the offer. An offer must be 
 accepted in the terms in which it is made, in-order to become binding, 
 and a conditional acceptance or one that varies from the offer in any 
 substantial respect is in efl'ect a rejection and amounts to a new prop- 
 osition. The phrase in the acceptance by the schoolhouse commission- 
 ers, which is relied on as rendering it conditional, was simply a refer- 
 ence to the sta:tute under which the matter was proceeding. It v^^as by 
 implication a part of the invitation for proposal and also of the bid 
 which the plaintiff had submitted. It added no new term to the pro- 
 posal or to the contract. It did not vary in any respect the offer, and 
 was therefore an unconditional and valid acceptance of it. * * * 
 
 5. The final contention of the plaintiff is that the deposit was a pen- 
 alty, and hence cannot be enforced. The terms of the agreement in- 
 dicate an intent to treat the deposit as liquidated damages, and this ap- 
 pears to be the purpose of the statute. The amount of the check must 
 be regarded as liquidated damages. It was in fact much smaller than 
 the loss sustained by the city, for by the failure of the plaintiff to take 
 the contract it was awarded to another bidder for a sum about $24,000 
 larger. The plaintiff refused to sign the contract except for an addi- 
 tional price of $21,000. Therefore no reason appears why the intent 
 of the parties as manifested by their written communication and the 
 purpose of the statute should not be carried out. Guerin v. Stacy, 175 
 Mass. 595, 56 N. E. 892; Garcin v. Pennsylvania Furnace Co., 186 
 Mass. 405, 71 N. E. 793 ; Morrison v. Richardson, 194 Mass. 370, 80 
 N. E. 468. 
 
 Exceptions overruled."* 
 
 SECTION 8.— MEETING OF THE MINDS— MISTAKE 
 
 RAFFLES V. WICHELHAUS et al. 
 (In the Court of Exchequer, 1864. 2 Hurl. & C. 906.) 
 
 Declaration. For that it was agreed between the plaintiff and the 
 defendants, to wit, at Liverpool, that the plaintiff should sell to the 
 defendants, and the defendants buy of the plaintiff, certain goods, to 
 
 «B The amount deposited as a forfeit cannot be recovered by the bidder in 
 case he withdraws his bid. City of Baltimore v. J. L. Robinson Const. Co., 
 123 Md. 660, 91 Atl. 682, L. E. A. 1915A,.225, Ann. Cas. 1916C, 425 (1914). And 
 see note, Ann. Cas. 1916C, 427. ^ 
 
Sec. 8) MEETING OF THE MINDS — MISTAKE 113 
 
 wit, 125 bales of Surat cotton, guaranteed middling fair merchant's 
 Dhollorah, to arrive ex Peerless from Bombay; and that the cotton 
 should be taken from the quay, and that the defendants would pay 
 the plaintifif for the same at a certain rate, to wit, at the rate of. 17i4tf. 
 per pound, within a certain time then agreed upon after the arrival of 
 the said goods in England. Averments : that the said goods did ar- 
 rive by the said ship from Bombay in England, to wit, at Liverpool, 
 and the plaintiff was then and there ready and willing and offered 
 to deliver the said goods to the defendants, etc. Breach: that the 
 defendants refused to accept the said goods or pay the plaintiff for 
 them. 
 
 Plea. That the said ship mentioned in the said agreement was 
 meant and intended by the defendants to be the ship called the Peer- 
 less, which sailed frohi Bombay, to wit, in October; and that the 
 plaintiff was not ready and willing, and did not offer to deliver to 
 the defendants any bales of cotton which arrived by tlje last-men- 
 
 . tioned ship, but instead thereof was only ready and willing, and of- 
 fered to deliver to the defendants 125 bales of Surat cotton which ar- 
 rived by another and different ship, which was also called the Peer- 
 less, and which sailed from Bombay, to wit, in December. 
 Demurrer, and joinder therein. 
 
 Milward, in support of the demurrer. The contract was for the sale 
 of a number of bales of cotton of a particular description, which the 
 plaintiff was ready to deliver. It is immaterial by what ship the cotton 
 was to arrive, so that it was a ship called the Peerless. The words "to 
 arrive ex Peerless," only mean that if the vessel is lost on the voyage, 
 the contract is to be at an end. [Pollock, C. B. It would be a ques- 
 tion for the jury whether both parties meant the same ship called the 
 Peerless.] That would be so if the contract was for the sale of a shi'p 
 called the Peerless ; but it is for the sale of cotton on board a ship of 
 that name. [Pollock, C. B. The defendant only bought that cotton 
 which was to arrive by a particular ship. It may as well be said, that 
 if there is a contract for the purchase of certain goods in warehouse A., 
 that is satisfied by the delivery of goods of the same description in 
 warehouse B.] In that case there would be goods in both warehouses ; 
 here it does not dppear that the plaintiff had any goods on board the 
 
 , other Peerless. [Martin, B. It is imposing on the defendant a con- 
 tract different from that which he entered into. Pollock, C. B. It 
 is like a contract for the purchase of wine coming from a particular es- 
 tate in France or Spain, where there are two estates of that name.] The 
 defendant has no right to contradict by parol evidence a written con- 
 tract good upon the face of it. He does not impute misrepresentation 
 or fraud, but only says that he fancied the ship was a different one. 
 Intention is of no avail, unless stated at the time of the contract. [PoL- 
 
 ' LOCK, C. B. One vessel sailed in October and the other in December.] 
 The time of sailing i$ no part of the, contract. 
 
 CORBIN CONT — ^8 
 
114 OFFER AND ACCEPTANCE (Ch. 1 
 
 Mellish (Cohen with him), in support of the plea. There is nothing 
 on the face of the contract to show that any particular ship called 
 the Peerless was meant; but the moment it appears that two ships 
 called the Peerless were about to sail from Bombay there is a latent 
 ambiguity, and parol evidence may be given for the purpose of show- 
 ing that the defendant meant one Peerless and the plaintiff another. 
 That being so, there was no consensus ad idem, and therefore no 
 binding contract. He was then stopped by the Court. 
 
 Per Curiam. There must be judgment for the defendants. 
 
 Judgment for the defendants.'^" 
 
 EMBRY V. HARGADINE-McKITTRICK DRY GOODS CO. 
 
 (St. Louis Court of Appeals. Missouri. 1907. 127 Mo. App. 383, 105 
 
 S. W. 777.) 
 
 Action by Charles R. Embry against the Hargadine-McKittrick 
 Dry Goods Company. From a judgment for 'defendant, plaintiff ap- ' 
 peals. Reversed and remanded. 
 
 GooDE, J.'^ We dealt with this case on a former appeal (115 Mo. 
 App. 130, 91 S. W. 170). It has been retried, and is again before us 
 for the determination of questions not then reviewed. The appellant 
 was an employe of the respondent company under a written contract 
 to expire December 15, 1-903, at a salary of $2,000 per annum. His 
 duties were to attend to the saiTiple department of respondent, of which 
 he was given complete charge. It was his business to select samples 
 for the traveling salesmen of the company, which is a wholesale dry 
 goods concern, to use in selling goods to retail merchants. 
 'Appellant contends that on December 23, 1903, he was re-engaged 
 by respondent, through its president, TJios. H. McKittrick, for another 
 year at the same compensation arid for the same duties stipulated in 
 his previous written contract. On March 1, 1904, he was discharged, 
 having been notified in February that, on account of the necessity of 
 retrenching expenses, his service? and that of some other employes 
 would no longer be required. The respondent company contends tibat 
 its president never re-employed appellant after the termination of his 
 written contract, and hence that it had a right to discharge him when 
 it chose. . The point with which we are concerned requires an epitome " 
 of the testimony of appellant and the counter testimony of McKittrick, 
 
 70 See, also, Neel v. Lang (Mass.) 127 N. E. 512 (1920), seller said $6,000 ; 
 buyer understood $3,000; no negligence; Snoderly v. Bower, 30 Idaho, 484, 
 166 Pac. 265 (1917), hay to be measured according to "government rule," and 
 there was no such rule ; Rovegno v. DefEerari, 40 Cal. 459 (1871) ; Rupley v. 
 Daggett, 74 111. 351 (1874); Rowland v. New York, N. H. & H. R. Co., 61 
 Conn. 103, 23 Atl. 755, 29 Am. St. Rep. 175 (1891) ; Greene v. Bateman, 10 
 Fed. Oas. 1126 (1846); Kyle v. Kavanagh, 103 Mass. 356, 4 Am. Rep. 560 
 (1869) ; Stong v. Lane, 66 Minn. 94, 68 N. W. 765 (1896) ; Sheldon v. Capron, 
 3 R. I. 171 (1855) ; Irwin v. Wilson, 45 Ohio St. 426, 15 N. E. 209 (1887). 
 
 1 1 Parts of the opinion are omitted. 
 
Sec. 8) MEETING OF THE MINDS— MISTAKE 115 
 
 the president of the company, in reference to the alleged re-employ- 
 ment. 
 
 ^ Appellant testified : That several times prior to the termination of 
 his written contract on December 15, 1903, he had endeavored to get 
 an understanding with McKittrick for another year, but had been put 
 oif from time to time. That on December 23d, eight days after the 
 expiration of said contract, he called on McKittrick, in the latter's of- 
 fice, and said to him that as appellant's written employment had lapsed 
 eight days before, and as there were only a few ,days between then 
 and the 1st of January in which to seek employment with other firms, 
 if respondent wished to retain his services longer he must have a con- 
 tract for another year, or he would quit respondent's service then 
 and there. That he had been put off twice before and wanted an un- 
 derstanding or contract at once so that he could go ahead without 
 worry. That McKittrick asked him how he was getting along in his 
 department, and appellant said he was very busy, as they were in the 
 height of the season getting men out — had about 110 salesmen on the 
 line and others in preparation. That McKittrick then said : "Go ahead, 
 you're all right. Get your men out,. and don't let that worry you." 
 That appellant took McKittrick at his word and worked until February 
 15th without any question in his mind. It was on February 15th that 
 he was notified his services would be discontinued on March 1st. 
 
 McKittrick denied this conversation as related by appellant, and said 
 that, when accosted by the latter on December 23d, he (McKittrick) 
 was working on his books in order to get out a report for a stock- 
 holders' meeting, and, when appellant said if he did not get a contraci 
 he would leave, that he (McKittrick) said: "Mr. Embry, I am just get- 
 ting ready for the stockholders' meeting to-morrow. I have no time to 
 take it up now. I have told you before I would not take it up until I 
 had these matters out of the way. You will have to see me at a later 
 time. I said: 'Go back upstairs and get your men out on the road.' 
 I may have asked him one or two other questions relative to the de- 
 partment, I don't remember. The whole conversation did not take more 
 than a minute." 
 
 Embry also swore that, when he was notified he would be discharged, 
 he complained to McKittrick about it, as being a violation of their con- 
 tract, and McKittrick said it was due to the action of the board of di- 
 rectors, and not to any personal action of his, and that others would 
 suffer by what the board had done as well as Embry. Appellant re- 
 quested an instruction to the jury setting out, in substance, the con- 
 versation between him and McKittrick according to his version, and 
 declaring that those facts, if found to be true, constituted a contract 
 between the parties that defendant would pay plaintiff the sum of 
 $2,000 for another year, provided the jury believed from the evidence 
 that plaintiff commenced said work believing he was to have $2,000 
 for the year's work. This instruction was refused, but the court gave 
 another embodying in substance appellant's version of the conversation. 
 
1 1 6 OFFER AND ACCEPTANCE (Ch. 1 
 
 and declaring it made a contract "if you (the jury) find both parties 
 thereby intended and did contract with each other for plaintifif's em- 
 ployment for one year from and including December 23, 1903, at a 
 salary of $2,000 per annum." Embry swore that, on several occa- 
 sions when he spoke to McKittricl^ about employment for the ensuing 
 year, he asked for a renewal of his former contract, and that on De- 
 cember 23d, the date of the alleged renewal, he went into Mr. McKit- 
 trick's office and told him his contract had expired, and he wanted to 
 renew it for a year, having always worked under year contracts. Nei- 
 ther the refused instruction nor the one given by the court embodied 
 facts quite as strong as appellant's testimony, because neither referred 
 to appellant's alleged statement to McKittrick that unless he was re- 
 employed he would etop work for respondent then and there. 
 
 It is assigned for error that the court required the jury, in order to 
 return a verdict for appellant, not only to find the conversation occur- 
 red as appellant swore, but that both parties intended by such conver- 
 sation to contract with each other for plaintiff's employment for the 
 year from December, 1903, at a salary of $2,000. If it appeared from 
 the record that there was a dispute- between the parties as to the- terms 
 on which appellant wanted re-employment, there might have been 
 sound reason for inserting this clause in the instruction ; but no issue 
 was made that they split on terms ; the testimony of McKittrick tend- 
 ing to prove only that he refused to enter into a contract with appel- 
 lant regarding another year's employment until the annual meeting 
 of stockholders was out of the way. Indeed, as to the proposed terms 
 McKittrick agrees with Embry, for the former swore as follows : "Mr. 
 Embry said he wanted to know about the renewal of his contract. Said 
 if he did not have the contract made he would leave." As the two 
 witnesses coincided as to the terms of the proposed re-employment, 
 there was no reason for inserting the above-mentioned clause in the 
 instruction in order that it might be settled by the jury whether or not 
 plaintiff, if employed for one year from December 23, 1903, was to be 
 paid $2,000 a year. Therefore it remains to determine whether or not 
 this part of the instruction was a correct statement of the law in re- 
 gard to what was necessary to constitute a contract between the parties ; 
 that is to say, whether the formation of a contract by what, according 
 tp Embry, was said, depended on the intention of both Embry and 
 McKittrick. Or, to put the question more precisely: Did what was 
 said constitute a contract of re-employment on the previous terms ir- 
 respective of the intention or purpose of McKittrick? 
 
 Judicial opinion and elementary treatises abound in statements of 
 the rule that to constitute a contract there must be a meeting of the 
 minds of the parties, and both must agree to the same thing in the same 
 sense. Generally speaking, this may be true ; but it is not literally or 
 universally true. That is to say, the inner intention of parties to a 
 conversation subsequently alleged to create a contract cannot either 
 make a contract of what transpired, or prevent one from arising, if the 
 
Sec. 8) MEETING OF THE MINDS — MISTAKE 117 
 
 words used were sufficient to constitute a contract. In so far as their 
 intention is an influential elehient, it is only such intention as the words 
 or acts of the parties indicate ; not one secretly cherished which is in- 
 consistent with those words or acts. * * * 
 
 In Smith V. Hughes, L. R. 6 Q. B. 597, 607, it was said : "If, what- 
 ever a man's real intention may be, he so conducts himself that a rea- 
 sonable man would believe that he was assenting to the terms proposed 
 by the other party, and that other party upon that belief 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." And 
 that doctrine .was adopted in Phillip v. Gallant, 62 N. Y. 256. In 9 Cyc. 
 245, we find the following text : "The law imputes to a person an in- 
 tention corresponding to the reasonable meaning of his words and 
 acts. It judges his intention by his outward expressions and excludes 
 all questions in regard to his unexpressed intention. If his words or 
 acts, judged by a reasonable standard, manifest an intention to agree 
 in regard to the matter in question, that agreement is established, and 
 it is immaterial what may be the real, but unexpressed, state of his 
 mind on the subject." Even more pointed was the language of Baron 
 Bramwell in Brown v. Hare, 3 Hurlst. & N. *484, *495 : "Intention is 
 immaterial till it manifests itself in an act. If a man intends to buy, 
 and says so to the intended seller, and he intends to sell, and says so 
 to the intended buyer, there is a contract of sale ; and so there would be 
 if neither had the intention." 
 
 In view of those authorities, we hold that, though McKittrick may 
 not have intended to employ Embry by what transpired between them 
 according tp the latter's testimony, yet if what McKittrick said would 
 have been taken by a reasonable man to be an employment, and Embry 
 so understood it, it constituted a valid contract of employment for the 
 ensuing year. 
 
 [The court then held 'that Embry was quite reasonable in giving the 
 construction that he did to McKittrick's words and acts. The judgment 
 was reversed and the case remanded for a new trial.] ^^ 
 
 72 In Woburn Nat. Bank v. Woods, 77 N. H. 172, 175, 89 Atl. 491 (1914), 
 the court said: "A contract involves vfiisit is called a meeting of the minds 
 of the parties. But this does not mean that they must have arrived at a com- 
 mon mental state touching the matter in hand. The standard by vifhich their 
 conduct is judged and their rights are limited Is not internal, but external. 
 In the absence of fraud or incapacity, the question is: What did the party 
 say and do? 'The making of a contract does not depend upon the state of 
 the parties' minds; it depends on their overt acts.' '" 
 
 In accord, see Holmes, Com. Lave, 307; Mansfield v. Hodgdon, 147 Mass. 
 304, 17 N. E. 544 (1888) ; Smith v. Hughes, L. R. 6 Q. B. 597 (1871) ; Dela- 
 ware, L. & W. R. (JO. V. Water Power & Supply Co., 227 Pa. 639, 76 Atl. 425 
 (1910) ; Northrup v. Colter, 150 Mo. App. 639, 131 S. W. 364 (1910) ; Carnegie 
 Steel Co. V. Connelly, 89 N. J. Law, 1, 97 Atl. 774 (1916), telephone order for 
 50 tons, when only 10 tons intended; Grant Marble Co. v. Abbot, 142 Wis. 
 279, 124 S. W. 264 (1910) ; Taplin & Rowell v. Clark, 89 Vt. 226, 95 Atl. 491 
 (1915), sale of a lot of horses, seller including a particular horse bv mistake; 
 New York Central R. Co, v. Beaham,, 242 U. S. 148, 37 Sup. Ot. 43, 61 L. Ed. 
 210 (1916), railway ticket plainly setting out terms of contract; Goldstein v. 
 
118 OFFER AND ACCEPTANCE (Ch. 1 
 
 AYER V. WESTERN UNION TEL. CO. 
 
 (Supreme Judicial Court of Maine, 1887. 79 Me. 493, 10 Atl. 495, 1 Am. St. 
 
 Rep. 353.) 
 
 Emery, J. On report. The defendant telegraph company was en- 
 gaged in the business of transmitting messages by telegraph between 
 Bangor and Philadelphia, and other points. The plaintiff, a lumber 
 dealer in Bangor, -delivered to the defendant company in Bangor, to 
 be transmitted to his correspondent in Philadelphia, the following mes- 
 sage': "Will sell 800 M laths, delivered at yout wharf, two ten net 
 cash. July shipment. Answer quick." The regular ta-riff rate was 
 prepaid by the plaintiff for such transmission. The message delivered 
 by the defendant company to the Philadelphia correspondent was as 
 follows: "Will sell 800 M laths, delivered at your wharf, two net 
 cash. July shipment. Answer quick." It will be' seen that the impor- 
 tant word "ten" in the statement of price was omitted. 
 
 The Philadelphia party immediately returned by telegraph the fol- 
 lowing answer: "Accept your telegraphic offer on laths. Cannot in- 
 crease price spruce." Letters afterwards passed between the parties, 
 which disclosed the error in the transmission of the plaintiff's message. 
 About two weeks after the discovery of the error, the plaintiff shipped 
 the laths, as per the message received by his correspondent, to-wit, at 
 two dollars per M. He testified that his correspondent insisted he was 
 entitled to the laths at that price, and they were shipped accordingly. 
 
 The defendant telegraph company offered no evidence whatever, and 
 did not undertake to account for or explain the mistake in the trans- 
 mission of the message. The presumption therefore is that the mis- 
 take resulted from the fault of the telegraph company. We cannot 
 consider the possibility that it may have resulted from causes beyond 
 the control of the company. In the absence of evidence on that point 
 we must assume that for such an error the company was in fault. 
 Bartlett v. Telegraph Co., 62 Me. 221, 16 Am. Rep. 437. 
 
 The fault and consequent liability of the defendant company being 
 thus established, the only remaining question is the extent of that lia- 
 bility in this case. The plaintiff claims it extends to the difference be- 
 
 D'Arcy, 201 Mass. 312, 87 N. E. 584 (1909), defendant wrote, "All you get 
 above $2,000 per year you may have as your commission ;" plaintifE got a ten- 
 ant for 5 years at $2,200 ; held, he was entitled to $1,000 ; Gibbs v. Wallace, 
 58 Colo. 364, 147 Pac. 686 (1915) ; Frankfort Marine Accident & Plate Glass 
 Ins. Co. V. California Artistic Metal & Wire Co., 28 Cal. App. 74, 151 Pac. 176 
 (1915) ; Inman Mfg. Co. v. American Cereal Co., 133 Iowa, 71, 110 N. W. 287, 8 
 L. R. A. (N. S.) 1140, 12 Ann. Cas. 387 (1907) ; S. F. Bowser & Co. v. Marks, 96 
 Ark. 113, 131 S. W. 334, 32 L. R. A. (N. S.) 429, Ann. Cas. 1912B, 357 (1910). 
 Mistakes are often made in sending code telegrams. Where an offeror used 
 the code word meaning 30,000 bushels, when he intended to offer only 3,000, 
 he was bound to deliver 30,000, unless the offeree knew of the mistake at time 
 of acceptance. Cargill Cornmission Co. v. Mowery, 99 Kan. 389, 161 Pac. 634, 
 162 Pac. 313 (1916). But if the code message is so negligently worded as to 
 be unintelligible, the offeree is equally negligent in giving it a meaning, and 
 there is no contract. Falck v. Williams, [1900] A. O. 176. 
 
Sec. 8) MEETING OF THE MINDS — MISTAKE 119 
 
 tween the market price of the laths and the price at which they were 
 shipped. The defendant claims its liability is limited to the amount 
 paid for the transmission of the message. It claiijis this limitation on 
 two grounds. * * * "'^ 
 
 2. The defendant company also claims that the plaintiff was not in 
 fact damaged to a greater extent than the price paid by him for the 
 transmission. It contends that the plairitiff was not bound by the er- 
 roneous message delivered by the company to the Philadelphia party, 
 and hence need not have shipped the laths at the, lesser price. This 
 raises the question whether the message written by the sender, 'and in- 
 trusted to the telegraph company for transmissidn, or the message writ- 
 ten out and delivered by the company to the receiver at the other end 
 of the line, as and for the message intended to be sent, is the better 
 evidence of the rights of the receiver against the sender. 
 
 The question is important and not easy of solution. It would be 
 hard that the negligence of the telegra.ph company, or an error in trans- 
 mission resulting from uncontrollable causes, should impose upon the 
 innocent sender of a message a liability he never authorized nor con- 
 templated. It would be equally hard that the innocent receiver, acting 
 in good faith upon the message as received by him, should through such 
 error lose all claim upon the sender. If one, owning merchandise, write 
 a message offering to sell at a certain price, it would seem unjust that 
 the telegraph company could bind him to sell at a less price, by mak- 
 ing that error in the transmission. On the other hand, the receiver of 
 the offer may in good faith, upon the strength of the telegram as re- 
 ceived by him, have sold all the merchandise to arrive, perhaps at the 
 same rate. It would seem unjust that he should have no claim for the 
 ^nerchandise. If an agent receive instructions by telegraph from his 
 principal, and in good faith act upon them as expressed in the message 
 delivered him by the company, it would seem he ought to be held jus- 
 tified, though there were an error in the transmission. 
 
 It is evident that in case of an error in the transmission of a tele- 
 gram either the sender or receiver must often suffer loss. As between 
 the two, upon whom should the loss ifinally fall ? We think the safer 
 and more equitable rule, and the rule the public can most easily adapt 
 itself to, is that, as between sender and receiver, the party who selects 
 the telegraph as the means of communication shall bear the loss caus- 
 ed by the errors of the telegraph. The first proposer can select one of, 
 many modes of communication, both for the proposal and the answer. 
 The receiver has no such choice, except as to his answer. If he cannot 
 safely act upon the message he receives through the agency selected by 
 the proposer, business must be seriously hampered and delayed. The 
 use of the telegraph has become so general, and so many transactions 
 are based on the words of the telegram received, that any other rule 
 would now be impracticable. 
 
 '2 The court's discussion of one of these grounds is omitted. 
 
120 OFFER AND ACCEPTANCE (Ch. 1 
 
 :0f course, the rule above stated presupposes the innocence of the 
 receiver, and that there is nothing to cause him to suspect an error. If 
 there be anything in the message, or in the attendant circumstances, or 
 in the prior deahngs of the parties, or in anything else, indicating a 
 probable error in the transmission, good faith on the part of the receiv- 
 er may require him to investigate before acting. Neither does the rule 
 include forged messages, for in such case the supposed sender did not 
 make any use of the telegraph. 
 
 The authorities are few and somewhat conflicting, but there are sev- 
 eral in harmony with our conclusion upon this point. In Durkee v. 
 Railroad Co., 29 Vt. 137, it was held that where the sender himself 
 elected to communicate by telegraph, the message received by the other 
 party is the original evidence of any contract. In Saveland v. Green, 
 40 Wis. 431, the message received from the telegraph company was ad- 
 mitted as the original and best evidence of a contract, binding on the 
 sender. In Morgan v. People, 59 111. 58, it was said that the telegram 
 received was the original, and it was held that the sheriff receiving 
 such a telegram from the judgment creditor was bound to follow it as 
 it read. There are dicta to the same effect in Wilson v. Railway Go., 
 31 Minn. 481, 18 N. W. 291, and Howley v. Whipple, 48 N. H. 488. 
 
 Telegraph Go. v. Shotter, 71 Ga. 760, is almost a parallel case. The 
 seilder wrote his message : "Gan deliver hundred turpentine at sixty- 
 four." As received from the telegraph company it read: "Gan de- 
 liver hundred turpentine at sixty," the word "four" being omitted. 
 The receiver immediately telegraphed an acceptance. The sender ship- 
 ped the turpentine, and drew for the price at 64. The receiver refused 
 to pay more than 60. The sender accepted the 60, and sued the tele- 
 graph company for the difference between 60 and the market. It was 
 urged, as here, that the sender was not bound to accept the 60, as that 
 was not his offer. The court held, however, that there was a complet- 
 ed contract at 60, that the sender must fulfill it, and could recover his 
 consequent loss of the telegraph company. 
 
 It follows that the plaintiff in this case is entitled to recover the dif- 
 ference between the two dollars and the market price, as to laths. The 
 evidence shows that the difference was 10 cents per M. 
 
 Judgment for plaintiff for $80, with interest from the date of the 
 writ.'* 
 
 T4ln accord: Butler v. Foley, 211 Mich. 668, 179 N. W. 34 (1920), counter 
 offeror bound by telegram as erroneously deliyeredi, even though the other 
 party had himself first sent an offer by wire; Des Are Oil Mill v. Western 
 Union Tel. Co., 132 Ark. 335, 201 S. W. 273, 6 A. L. R. 1081 (1918) ; Western 
 Union Tel. Co. v. Shotter, 71 Ga. 760 (1883); Haubelt Bros. & Page Mill v. 
 Rea Co., 77 Mo. App. 672 a898); Sherrerd v. "VVestern Union Tel. Co., 146 
 Wis. 197, 131 N. W. 341 (1911) ; Durkee v. Vermont Cent. B. Co., 29 Vt. 12T 
 (1856)-; Bowman & Bull Co. v. Postal Telegraph Gable Co., 290 111. 155, 
 124 N. E. 851 (1919) (semble). See, also, Penobscot Fish Co. v. Western Union 
 Tel. Co., 91 Conn. 35, 98 Atl. 341 (1916) ; Postal Telegraph &' Cable Co. v. 
 Wells, 82 Miss. 733, 35 South. 190 (1903). 
 The English rule is contra, and so are several American cases. Henkel v. 
 
Sec, 8) MEETING OF THE MINDS — MISTAKE 121 
 
 STEINMEYER et al. v. SCHROEPPEL. 
 
 (Supreme Court of Illinois, 1907. 226 111. 9, SO N. E. 564 10 L,. R. A. [N S.] 
 114, 117 Am. St. Rep. 224.) 
 
 Action by Henry Steinmeyer and others against John Schroeppel, 
 which was consolidated with a suit by Schroeppel against Henry Stein- 
 meyer and others. From a decree of the Appellate Court, reversing 
 a decree, canceling a contract between the parties, Henry Steinmeyer 
 and others appeal. Affirmed. 
 
 Cartwright, J. Appellants are in the lumber business at Collins- 
 ville, 111., and appellee is a building contractor at the same place. On 
 June 10, 1905, appellee was about to erect a building for himself, and 
 left at the office of appellants an itemized list of lumber, containing 34 
 items, on which he desired them to give him a price. Appellants' book- 
 "keeper set down upon that list, opposite each item, the selling price, but 
 did not add up the column.* If correctly added, the column would have 
 footed up $1,867. One of the appellants made the addition, and, by 
 mistake, made the total $1,446. The bookkeeper copied the list on one 
 •of appellants' billheads without the prices opposite the different items, 
 and wrote at the bottom, "Above for $1,446," and delivered the paper 
 to appellee the same evening. Appellee received bids for the lumber 
 from two other firms, which were in the neighborhood of $1,890. On 
 June 16th appellee called at the office of appellants and accepted their 
 offer. He did not bring the paper with him, but the bookkeeper made 
 -another copy and at the boftom of it wrote the same memorandum, 
 "Above for $1,446." One of the appellants signed it, and a mem- 
 orandum was then written below to the effect that if delivery was made 
 within 30 days the appellants were to have $20 more than the estimate, 
 but if delivery was made after 30 days appellee was to have a rebate of 
 $20 from the estimate, and this was signed by both parties. The same 
 evening one of the appellants, looking over the bill, found that he had 
 not added the amounts correctly, and the next morning one of them 
 notified appellee by telephotie of the mistake, and refused to furnish the 
 lumber for less than $1,867. Appellants also sent appellee a notice 
 that they had found an error of $42 1, and the estimate should read 
 $1,867 instead of $1,446. Appellants did not furnish the lumber, and 
 
 Pape, L. R. 6 Ex. 7 (1870) ; Pepper v. Western Union Tel. Co., 87 Tenn. 554, 
 11 S. W. 783, 4 L. R. A. 660, 10 Am. St. Rep. 699 (1889) ; Shingleur v. Western 
 Union Tel. Co., 72 Miss. 1030, 18 South. 425, 30 L. R. A. 444, 48 Am. St. Rep. 
 604 (1895) ; Strong v. Western Union Tel. Co., 18 Idaho, 389, 109 Pac. 910, 
 30 L. R. A. (N. S.) 409, Ann. Cas. 1912A, 55 (1910) ; Mt. Gilead Cotton Oil 
 Co. V. Western Union Tel. Co., 171 N. C. 705, 89 S. E. 21 (1916). The German 
 Civil Code, §§ 120, 122, follows this rule but requires an indemnity, perhaps 
 somewhat in the nature of a division of the loss. 
 
 If the offeree knew or ought to have known that there was an error, there 
 is no contract. Germain Fruit Co. v. Western Union Tel. Co., 137 Cal. 598, 70 
 Pac. 658, 59 L. R. A. 575 (1902). Cf. J. L.. Price Brokerage Co. v. Chicago, 
 B. & Q. R. R. Co. (Mo. App.) 199 S. W. 732 (1917), and comment in 27 Yale 
 U. Jour. 932. 
 
122 OFFEK AND ACCEPTANCE (Ch. 1 
 
 appellee purchased it at the next lowest bid from another firm, and 
 sued appellants for the difference between what he paid for the lumber, 
 and what they had agreed to furnish it for. , 
 
 Appellants then filed a bill to enjoin the prosecution of the suit at 
 law, and to have the contract canceled on account of the mistake. The 
 suits were consolidated and tried together without a jury. The circuit 
 court entered a decree, canceling the contract, and restraining appellee 
 from prosecuting his suit at law. The Appellate Court for the Fourth 
 District reversed the decree, and remanded the cause to the circuit 
 court, with directions to dissolve the , injunction and dismiss the bill 
 for want of equity. Appellants applied to the Appellate Court for a 
 certificate of importance, which was granted, and this appeal was pros- 
 ecuted. 
 
 The jurisdiction of equity to grant the remedy of cancellation because 
 of a mistake of fact by one party to a coiitract is well recognized. Mu- 
 tual consent is requisite to the creation of a contract, and if there is 
 a mistake of fact by one of the parties going to the essence of the con- 
 tract, no agreement is, in fact, made. 2 Kent's Com. 477. If there is 
 apparently a valid contract in writing, but by reason of a mistake of 
 fact by one of the parties, not due to his negligence, the contract is 
 different with respect to the subject-matter or terms from what was 
 intended, equity will give to such party a remedy by cancellation where 
 the parties can be placed in statu quo. The ground for relief is, that 
 by reason of the mistake there was no mutual assent to the terms of 
 the contract. 24 Am. & Eng. Ency. of Law (2d Ed.) 618. The fact 
 concerning which the mistake was made must be material to the trans- 
 action and affect its substance, and the mistake must not result from 
 want of the care and diligence exercised by persons of reasonable pru- 
 dence under the same circumstances. Bonney v. Stoughton, 122 111. 
 536, 13 N. E. 833. 
 
 In this case the mistake was in the addition of the figures set down 
 by the bookkeeper. The price of each item was written correctly, but 
 appellants claimed that one item of about $400 was placed somewhat 
 to the right, and in adding the column the 4 was counted in the 10- 
 column instead of the 100-column. If that was done, it does not ac- 
 count for the difference of $421. But if it did, it would only show a 
 want of ordinary care and attention. If the figures were not exactly in 
 line, the fact could hardly escape notice by a competent business 
 man giving reasonable attention to what he was doing. There was no 
 evidence tending to prove any special circumstances excusing the blun- 
 der. 
 
 The case of Board of School Com'rs v. Bender, 36 Ind. App. 164, 72 
 N. E. 154 (decided by the Appellate Court of Indiana, Division No.' 2), 
 relied on by appellants, differs from this in various respects^ one of 
 which is that Bender was excusable for the mistake. His complaint 
 alleged that he was misinformed by the architect that his bid must be 
 in at or before 4 o'clock, when, in fact, he was allowed until 8 o'clock; 
 
Sec. 8) MEETING OP THE MINDS — MISTAKE 123 
 
 that in ignorance of the fact and for want of time he was hurried in 
 submitting his bid, and had no opportunity for verification- of his es- 
 timate, and that under those circumstances he turned two leaves of his 
 estimate book by mistake and omitted an estimate on a large part of the 
 work. "The case involved the question whether the bidder had forfeited 
 a sum deposited as a guaranty that he would enter into a contract, and 
 when notified that his bid was accepted, -having discovered his mistake, 
 he informed the architect and immediately gave notice that he would 
 not enter into the contract. By the terms of the bid it was intended 
 that if the bid was accepted a contract wduld be made, but the bid was 
 not the contract contemplated by the parties and the bidder never did 
 enter into the contract. The court concluded that the minds of the 
 parties never, in fact, met, because the bidder fell into the error without 
 his fault. In the case of Harran v. Foley, 62 Wis. 584, 22 N. W. 837, 
 there was no agreement, for the reason that the minds of the parties 
 never met. The plaintiff claimed to have purchased of the defendant 
 some cattle for $161.50, but the defendant intended to state the price at 
 $261.50. When the defendant was informed that the plaintiff under- 
 stood the price to be $161.50 he refused to deliver the cattle and ten- 
 dered back $20 received on the purchase price. No agreement was, in 
 fact, made, since the statement of the price by the seller was clearly a 
 rriistake. 
 
 A mistake which will justify relief in equity must affect the sub- 
 stance of the contract, and not a mere incident or the inducement for 
 entering into it. The mistake of the appellants did not relate to the sub- 
 ject-matter of the contract, its location, identity, or amount, and there 
 was neither belief in the existence of a fact which did not exist or 
 ignorance of any fact material to the contract which did exist. The 
 contract was exactly what each party understood it to be and it express- 
 ed what was intended by each. If it can be set aside on account of the 
 error in adding up the amounts representing the selling price, it 
 could be set aside for a mistake in computing the percentage of profits 
 which appellants intended to make, or on account of a mistake in the 
 cost of the lumber to them, or any other miscalculation on their part. 
 If equify would relieve on account of such a mistake there would be no 
 stability in contracts, and we think the Appellate Court was right in 
 concluding that the mistake was not of such a character as to entitle 
 the appellants to the reUef prayed for. - 
 
 The judgment of the Appellate Court is affirmed. 
 
 Judgment affirmed.'* 
 
 7 5 Wlieii the terms of a contract have been reduced to a definite written doc- 
 ument, the parties are bound by the terms as so written, in spite of ignorance 
 or mistake of one of the piartles as to such terms, provided the other party 
 assented in good faith and without knowledge of the mistake. Eldridge v. 
 Dexter & P. R. Co., 88 Me. 191, 33 Atl. 974 (1895) ; Hlx v. Eastern S. S. Co., 
 107 Me. 357, 78 Atl. 379 (1910); Grace v. Adams, 100 Mass. 505, 97 Am. Dec. 
 117, 1 Am. Rep. 131 (1868) ; Metzger v. ^tna Ins. Co., 227 N. T. 411, 125 N. 
 E. 814 (1920), citing many cases ; Shulman v. Moser, 284 111. 134, 119 N. E. 
 
124 OFFER AND ACCBPTANCH (Ch. 1 
 
 ST. NICHOLAS CHURCH v. KROPP. 
 
 (Supreme Court of Minnesota, 1916. 135 Minn. 115, 160 N. W. 500, L. E. A. 
 
 1917D, 741.) 
 
 Action by the St. Nicholas Church against the Merchants' National 
 Bank of St. Cloud, which interpleaded Carl Kropp. From a judgment 
 for plaintiff and from an order denying new trial, the interpleaded de- 
 fendant appeals. Order reversed, and cause remanded, with direc- 
 tions. 
 
 Holt, J.'" Plaintiff, a religious body, desired to erect a church. It 
 advertised for bids. Carl Kropp and two others responded. Each bid 
 was accompanied by a certified check in the sum of $1,000 to insure 
 the entering of a contract by the successful bidder to build the church 
 according to the plans and specifications upon which the bids were 
 made. When the three bids were opened in the presence of the bid- 
 ders, Kropp's, being for $30,973, was found to be the lowest, about 
 $3,900 below t^e next highest. Thereupon the committee of plaintiff 
 in charge of the building of the church voted to award the work to 
 Kropp and notified him that his bid was accepted. The contract was 
 not then drawn, owing to the illness of the architect. The same day 
 Kropp, on his return home, discovered that through some oversight the 
 item of the structural iron required in the building had not been includ- 
 ed in his bid. The value of furnishing this in place was es'timated at 
 $2,350. The next day he notified the building committee of his mis- 
 take, and that he could not enter the contract unless he received at 
 least $2,000 more than the bid. This the committee declined to give. 
 Kropp refused to enter the contract and stopped payment of his cer- 
 tified check. The erection of the church building was awarded to one 
 Lange for $32,775 on a belated bid received three or four days after 
 the others had been opened. 
 
 936 (1918); American Water Softener Qo. v. XJ. S., 50 Ct. CI. 209 (1915);; 
 Hosliaw V. OosgrifE, 247 Fed. 22, 159 C. C. A. 240 (1917). 
 
 Where a vouctier or ticket is delivered by one party to the other, in such 
 manner that the latter ought to know tlaat It contains the terms of the con- 
 tract, his acceptance binds him in accordance with those terms. N. Y. Cen- 
 tral R. Co. v. Beaham, 242 TJ. S. 148, 37 Sup. Ct. 43, 61 L. Ed'. 210 (1916) ; 
 Fonseca v. Cunard Steamship Co., 153 Mass. 553, 27 N. E. 665, 12 L. R. A. 
 840, 25 Am. St. Rep. 660 (1891) ; Zimmer v. New York Cent. & H. R. R. Co.,. 
 137 N. Y. 460, 33 N. B. 642 (1893) ; Ballou v. Earle, 17 R. I. 441, 22 Atl. 1113, 
 14 L. R. A. 433, 33 Am. St Rep. 881 (1891) ; Parker v. Southeastern Ry., 2 
 C. P. D. 416 (1877). He is not so bound unless he has reasonable notice that 
 the ticket contains ttie terms offered. The Majestic, 166 U. S. 375, 17 Sup. 
 Ct. 597, 4-1 L. Ed. 1039 (1897). 
 
 Where the words of a document are capable of two reasonable interpreta- 
 tions, they will be interpreted contra proferentem — i. e., against the parly who 
 chose the particular form of expression. Liverpool & L. & G. Ins. Co. v. Kear- 
 ney, 180 U. S. 132, 21 Sup. Ct. 326, 45 L. Ed. 460 (1901) ; Eyers v. Haddem 
 (C. C.) 70 Fed. 648 (1895) ; Ardis v. Grand Rapids & I. R. Co., 200 Mich. 400, 
 167 N. W. 5 (1918) ; Star-Chronicle Pub. Co. v. New York Evening Post, 256 
 Fed. 435, 167 C. O. A. 563 (1919) ; Lieber, Hermeneutics, 121; Roman law^ 
 Dig. 45, 1,99; Id. 2, 14, 39. 
 
 T« I'arts of the opinion are omitted. 
 
Sec. 8) MEETING OF THE MINDS — MISTAKE • 125 
 
 This action was brought by plaintiff against the bank upon which the 
 check was drawn. The bank answered, deposited the amount of the 
 check in court, and asked the court to require Kropp to interplead. 
 This was done. Kropp's; answer was that he had made a mistake in 
 his bid as above indicated ; that he at once, upon discovery of the mis- 
 take notified plaintiff ; that this was done before all the bids were re- 
 ceived ; that plaintiff knew of the mistake made by him ; and that the 
 bid was withdrawn before accepted. Appellant demanded a jury trial. 
 This was denied, but the court submitted three issues to a jury which 
 found thereon : That the building committee awarded the contract to 
 Kropp on the day the bids were opened ; that Kropp made an honest 
 mistake in his bid without being negligent ; and that the building com- 
 mittee had no knowledge of Kropp's mistake when it accepted his bid. 
 The court made findings of fact, adopting therein the verdict of the 
 jury, and conclusion of law that plaintiff was entitled to the fund. A 
 new trial was denied, and Kropp appeals. * * * 
 
 The jury and court found that in his bid Kropp had made an honest 
 mistake without negligence. The mistake amounted to more than $2,- 
 000. Does this entitle him to any relief when plaintiff was not to 
 blame in any way for the mistake, and had no knowledge that Kropp 
 had made it ? We' think the facts herein bring the case within this 
 principle governing a unilateral mistake stated in section 138i,- Story's 
 Equity Jurisprudence : 
 
 "But where the mistake is of so fundamental a character that the 
 minds of the parties have never, in fact, met, or where an unconscion- 
 able advantage has been gained, by mere mistake or misapprehension, 
 and there was no gross negligence on the part of the plaintiff, either in 
 falling into the error or in not sooner making redress, and no interven- 
 ing rights have accrued, and the parties may still be placed in statu 
 quo, equity will interfere, in its discretion, to prevent intolerable injus- 
 tice." 
 
 In Hearne v. Marine Ins. Co., 20 Wall. 488, 22 L,. Ed. 395, it is said : 
 
 "A mistake on one side may be a ground for rescinding, but not for 
 reforming, a contract. Where the minds of the parties have not met, 
 there is no contract, and hence none to be rectified.!' 
 
 The question here is whether a mistake -of over $2,000 in the bid 
 upon the construction of this church is merely incidental or funda- 
 mental. We think the amount is so large that it is unreasonable to 
 suppose that Kropp would have made the bid he did make, if he had 
 known that the structural iron work was not included therein. Here 
 the finding is that it was an honest mistake made without negligence. 
 Plaintiff was apprised of the error at once. No intervening rights ac- 
 crued. The belated bid which plaintiff accepted was a trifle less than 
 the one Kropp intended to make. There can be no question of not 
 placing plaintiff in statu quo. It did nothing in reliance upon Kropp's 
 bid, and did not change its position in the least between the time it no- 
 tified him of the acceptance and the time it received notice of his mis- 
 
126 OFFER AND ACCEPTANCE (Ch. 1 
 
 take. This is said advisedly; for, although the checks of the other 
 two bidders were returned to them, plaintiff accepted another bid ob- 
 tained without any effort on its part, and in an amount very much 
 lower than either of the two upon which the checks were returned. 
 
 In this situation, we think, the same principle which denied a spe- 
 cific perfoi-manee in the case of a unilateral mistake in Buckley v. Pat- 
 terson, 39 Minn. 250, 39 N. W. 490, should here interfere and cancel 
 the bid of Kropp. In Benson v. Markoe, 37 Minn. 30, 33 N. W. 38, 5 
 Am. St. Rep. 816, the doctrine is recognized that a contract "may be 
 rescinded or canceled for the mistake of one only of the parties. 
 * * * Of course, this should not be done unless th^ parties can be 
 replaced in their former position." The bid was, at most, but a step in 
 the making of the contract. It was well understood that before Kropp 
 would be permitted to begin the erection of the building he must exe- 
 cute a formal contract and give adequate bond. The contract was 
 therefore wholly executory. * * * 
 
 In Scott V. Hall, 58 N. J. Eq. 42, 43 Atl. 50, where the vendor in a 
 conditional sale contract agreed to transfer the chattels to the one in 
 possession for $525 on the mistaken supposition that there was $650 
 due on the contract instead of $950, and the check for $525 was al- 
 ready in the hands of the vendor's agent when the mistake was dis- 
 covered, the court rescinded the bargain. Vice Chancellor Pitney say- 
 ing : 
 
 "Now it seems to me plain enough that, having agreed upon a sum 
 based on $650 being due, when there was in fact $950 due, this court 
 ought to relieve him from a contract made upon such a mistaken ba- 
 sis, unless before notice the other party has so acted upon it that it 
 would be unjust to him to be compelled to submit to rescission. Now 
 in this case notice was given immediately to defendant's counsel and 
 while the affair was unfinished and not concluded in the manner in 
 which the parties intended to conclude it; for it was their intention 
 that there should be a written transfer of title." 
 
 So here there was to be a formal contract executed. That a mistake 
 by one party as to price is material and ground ^or holding that the 
 minds of the parties did not meet, see Rowland v. New York, N. Ha- 
 ven & H. Ry. Co., 61 Conn. 103, 23 Atl. 755, 29 Am. St. Rep. 175 ; De 
 Voin V. De Voin, 76 Wis. 66, 44 N. W. 839; and Webster v. Cecil, 30 
 Beav. 62. 
 
 Steinmeyer v. Schroeppel, 226 111. 9, 80 N. E. 564, 40 L. R. A. (N. 
 S.) 114, 117 Am. St. Rep. 224, is really not in favor of plaintiff on the 
 findings here made ; for it was there held that the error in the com- 
 putation occurred through the negligence of the party who asserted the 
 mistake. Moreover it is clear that in a case of that kind, where the 
 lumber, the subject of the contract, had been used, it was impossible 
 to place the parties in statu quo. However, the court therein recogniz- 
 ed the existence of the rule we hold applicable to the facts in the case 
 at bar. We think also, where the parties have entered to such an ex- 
 
Sec. 8) MEETING OF THE MINDS— MISTAKE 127 
 
 tent upon a performance of their contract that it becomes difficult to 
 restore them to their former position, rescission will not be decreed. To 
 this class belongs Tatum v. Coast Lumber Co., 16 Idaho, 471, 101 Pac. 
 957, and other authorities cited in the annotation to that case in 23 L. 
 R. A. (N. S.) 1109. 
 
 Such also is the rule where a bid has been acted upon so that can- 
 cellation would be unjust or inequitable to the party having accepted if 
 without knowledge of the other party's mistake. Young v. Springer, 
 113 Minn. 382, 129 N. W. 773. The case of Crilly v. Board of Edu- 
 cation, 54 111. App. 371, is very similar to the instant case, except there 
 it was found that the mistake was due to the negligence of the party 
 making the mistake, while here the finding is to the contrary, and that 
 very fact brings the case within the operation of the rule. So far as 
 we are aware the only decision upon facts as here found, supporting 
 plaintiff's position is Brown v. Levy, 29 Tex. Civ. App. 389, 69 S. W. 
 255 ; but therein no reference is made to the well-established equitable 
 principle permitting relief from unilateral mistakes, and we are not in- 
 clined to follow its lead. 
 
 Our conclusion is that the order denying a new trial should be re- 
 versed, and the. cause remanded, with direction to the court below -to 
 amend the conclusion of law so as to rescind and cancel the bid and 
 award the fund in court to Kropp. 
 
 So ordered.''' ' 
 
 TYRA V. CHENEY. 
 
 (Supreme Court of Minnesota, 1915. 129 Minn. 428, 152 N. W. 835.) 
 
 Action by Joseph Tyra, etc., against Robert J. Cheney, etc. Verdict 
 for plaintiff, and, from denial of alternative motion for judgment or 
 new trial, defendant appeals. Affirmed. 
 
 Holt, J.''* The defendant had the contract to add to and repair a 
 school building in Minneapolis, Minn. Plaintiff did some work and 
 furnished some material in the performance of the contract. This 
 action was to recover the reasonable value thereof, less certain admit- 
 ted payments. In defense an express contract was pleaded, and judg- 
 ment tendered for $27, the unpaid balance. Verdict for plaintiff, and 
 
 "In the following cases equity granted relief to the bidder: Neill v. Mid- 
 land E. Co., 20 I>. T. N. S. 864 (1869), mistake discovered after part perform- 
 ance ; Moffett, H. & C. Co. v. Rochester, 178 TJ. S. 373, 20 Sup. Ct. 957, 44 L. 
 Ed. 1108 (1900), mistake discovered before executing written contract; Board 
 of School Oom'rs of City of Indianapolis v. Bender, 36 Ind. App. 164, 72 N. W. 
 154 (1905), same. 
 
 Equity refused relief to the bidder in the following cases: Crilly v. Board 
 of Education of City of Chicago, 54 111. App. 371 (1894), on grormd that plain- 
 tiff was negligent; Douglas v. Grant, 12 111. App. 273 (1883), contract partly 
 perfoi^ned before discovery' of mistake ; Brown v. Levy, 29 Tex. Civ. App. 
 389, 69 S. W. 255 (1902). See, also, Wheaton Bldg. & Lumber Co. v. City of 
 Boston, 204 Mass. 218, 90 N. E. 598 (1910), ante, 'p. 110. 
 
 ?8 Part of the opinion is omitted. 
 
128 OFFER AND AOCBPTANCJ!, (Ch. 1 
 
 defendant appeals from the order denying his motion in the alternative 
 for judgment or a new trial. 
 
 Plaintiff's contention, in brief, was : About the last of July, 1912, he 
 offered to bid on the roofing and sheet metal work required in defend- 
 ant's contract. Lacking time to put the bid, or estimate, in formal 
 shape, he, on July 27th, gave to defendant's estimator the figures for 
 'the various items, namely, $963 for the new part of the building, $2,410 
 for the old part, $400 for registers, and $251 for metal covered doors; 
 the total bid being about $4,025. On August 1st he was told the bid came 
 too late, but, nevertheless, he could send it in in writing. Plaintiff 
 undertook to do so on the 3d, but now claims the item of $963 for the 
 new part of the building was left out through oversight. A few days 
 thereafter, upon inquiring about his chance of securing the work, he 
 was told that his bid was too high. However, he persisted in the at- 
 tempt to induce defendant to use, instead of the specified metal doors, 
 metal doors of plaintiff's make. He succeeded, and late in August, was 
 awarded a separate contract for the doors for $295. Nothing further 
 was heard from defendant until in September, when plaintiff was told 
 to go ahead with the Work. Defendant denies ever receiving any es- 
 timate, bid, or figures, except the written bid. 
 
 The court, in submitting the case, charged that the burden was upon 
 plaintiff to show, by a fair preponderance of testimony, that when,, in 
 September, 1912, defendant gave plaintiff the direction to proceed with 
 the work, it was done with knowledge of plaintiff's mistake of $963 
 in the written bid and of his resting under the belief that it conformed 
 to the oral bid of $4,025, so that it might be truthfully found that 
 defendant did not accept the written bid of $3,062 in good faith, then 
 plaintiff could recover the reasonable value, otherwise the verdict must 
 be limited to the amount tendered in the answer. We believe this the- 
 ory sound. If cognizant of the mistake in plaintiff's bid, and that the 
 latter was unaware of its occurrence, defendant had no right to claim 
 that, when he told plaintiff to go ahead, with the work, their minds 
 met upon the price mistakenly stated in the bid. Nor should plaintiff 
 be allowed to profit by his own mistake, so as to hold defendant to the 
 oral bid. There was a failure to enter a binding contract. One cannot 
 snap up an offer or bid knowing that it was made in mistake. Page 
 on Contracts, § 86; Elliott on Contracts, § 107; Harran v. Foley, 62 
 Wis. 584, 22 N. W. 837 ; Everson & Co. v. International Granite Co., 
 65 Vt. 658, 27 Atl. 320; Singer v. Grand Rapids Match Co., 117 Ga. 86, 
 43 S. E. 755 ; Rowland v. N. Y., etc., Ry. Co., 61 Conn. 103, 23 Atl. 
 755, 29 Am. St. Rep. 175 ; Peerless Glass Co. v. Pacific Crockery & T. 
 Co., 121 Cal. 641, 54 Pac. 101. This also disposes of alleged errors in 
 admitting evidence of reasonable value. * * * 
 
 The order is affirmed. 
 
Sec. 8) MEETING OP THE MINDS — MISTAKE 129 
 
 JONES V. CHICAGO, B. & Q. R. CO. 
 (Supreme Court of Nebraska, 1918. 102 Neb. 853, 170 N. W. 170.) 
 
 Sedgwick, JJ^ -The plaintiff brought this action in the district court 
 for Lancaster county to recover the value of a carload of flour al- 
 leged to have been converted by the defendant. The flour was ship- 
 ped by the Washbvtm-Crosby Company of Minneapolis, and a con- 
 troversy arose between that company and the plaintiff as to the right 
 to the flour. It was the duty of the defendant railroad company to 
 deliver the flour to the true owner, and it was delivered to the Min- 
 neapolis company. The question, then, is whether the Minneapolis 
 company or this plaintiff was the owner of the flour and entitled to 
 the delivery thereof. The court instructed the jury to find a verdict 
 for the defendant, which was done, and judgment entered thereon, 
 and the plaintiff has appealed. 
 
 The Minneapolis company had contracted the flour to one Furman, 
 •of York, some time before the shipment. In the meantime the price 
 of flour had advanced to nearly double the contract price to Furman. 
 By mistake of the company, the Furman order had been entered as an 
 order of this plaintiff, and it was by mistake shipped to Lincoln, con- 
 signed to the shipper's order, with instructions to notify the plaintiff. 
 A draft for the price of the flour as contracted to Furman was at- 
 tached to the bill of' lading, and wh»n this plaintiff was notified he paid 
 the draft ^and demanded the flour. In the meantime the Minneapolis 
 company had instructed the railroad company not to deliver the flour to 
 the plaintiff, and to return the flour to the shipper at Omaha, which 
 the railroad company did. 
 
 "Where a person contracts with another, believing him to be one with 
 whom he intends to contract, while as a matter of fact it is another per- 
 son, there is no agreement, as where * * * a person obtains goods 
 by fraudulently impersonating a third person to whom the owner sup- 
 poses he is selling, or by pretending to be the agent of a third person 
 to whom the owner supposes he is sellitig." 35 Cyc. 60. It appears that 
 the Mitineapolis company supposed it had contracted this flour to this 
 plaintiff, when, as a matter of fact, it had contracted to Furman, and 
 did not ship the flour as an offer to sell to the plaintiff, and had no in- 
 tention of making a contract of sale with the plaintiff. The minds. of 
 the parties, therefore, never met, so as to amount to a contract of sale. 
 The plaintiff concedes that he had not ordered these goods, but testi- 
 fies that he had instructed his son to order flour, and when he was no- 
 tified of the shipment of this flour he supposed in good faith that it was 
 in response to an order by his son. Thus it appears again that the 
 
 7 8 Part of the opinion is onlitted. , 
 
 COBBIN OONT 9 
 
130 OFFER AND ACCEPTANCE (Ch. 1 
 
 minds of these parties had never met in the making of a contract of 
 sale. * * * 
 Affirmed.*" 
 
 JACOB JOHNSON FISH CO. v. HAWLEY. 
 (Supreme Court of Wisconsin, 1912. 150 Wis. 578, 137 N. W. 773.) 
 
 Action by the Jacob Johnson Fish Company against John Hawley, 
 administrator. Judgment for plaintiff, and defendant appeals. Re- 
 versed and remanded. 
 
 Action for damages on contract. 
 
 Plaintiff applied to defendant's intestate, Batt. Hawley, to engage 
 the tug "Tramp" in the fishing industry on Lake Superior for the sea- 
 son, using these words : "If tug 'Tramp' is not engaged will pay $300 
 for season. Wire me answer please," Defendant promptly replied: 
 "Tug not engaged. Go for three hundred for thirty days, you pay ex- 
 penses one way. Wire answer." Plaintiff answered : "Terms accept- ' 
 ed, engage Capt. Garland, writing." Also wrote inclosing duplicate' 
 forms for leases, and requesting execution thereof and return of one 
 duplicate so. that the matters might be regarded as settled, assuring de- 
 fendant that the lessee would pay expenses one way and saying, "We 
 wired you this morning that your terms were accepted and to engage 
 Capt. Garland. And we will writ»him also and engage his services. 
 We want no other man if we can get him. We expect to wan): the boat 
 Nov. 15th unless we wire you otherwise, you may be here on that date. 
 Please have lease signed before notary public." 
 
 Upon Mr.' Hawley receiving the papers, he promptly complained by 
 
 so Where one party is mistaken as to tlie identity of the other party, with- 
 out negligence, there is no contract. School Sisters of Notre Dame v. Kusnitt, 
 125 Md. 323, 93 Atl. 928, L. R. A. 1916D, 792 (1915) ; Fay v. Hill, 249 Fed. 
 415, 161 O. 0. A. 389 (1918) ; Brighton Packing Co. v. Butchers' Slaughter & 
 Melting Ass'n, 211 Mass. 398, 97 N. E. 780 (1912), the owners and managers of 
 a corporation reincorporated under the Identical name in another state; 
 Phelps V. McQuade, 158 App. Div. 528, 143 N. Y. Supp. 822 (1913) ; Cundy v. 
 Lindsay, 8 App. Cas. 459 (1878) ; Morgan Munitions Supply Co. v. Studebaker 
 Corporation of America, 226 N. Y. 94, 123 N. E. 146 (1919) ; Boston Ice Co. v. 
 Potter, 123 Mass. 28, 25 Am. Rep. 9 (1877). 
 
 An offer made to a partnership cannot be accepted by a corporation of the 
 same name later formed, even though its stockholders are identical with the 
 members of the superseded partnership. Jordan, Marsh & Co. v. Beats 201 
 Mass. 163, 87 N. E. 471 (1909). 
 
 A distinction has been drawn where a defrauder deals in person with the 
 party he is defrauding, but assumes the name and credit of a third person. 
 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 purchaser of the goods ob- 
 tained 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, 117 Me. 138, 102 Atl. 977 (1918); Edmunds v. Merchants' Despatch 
 Transp. Co., 135 Mass. 283 (1883) ; Samuel v. Cheney, 135 Mass. 278, 46 Am. 
 Rep. 467 (1883) ; hut see contra Pacific Express Co. v. Shearer, 160 111 215 
 43 N. E. 816, 37 L. R. A. 177, 52 Am. St. Rep. 324 (1896). 
 
Sec. 8) MEETING OF THE MINDS — MISTAKE 131 
 
 telephone that the terms specified therein were not according to the 
 offer, and the condition, as to hiring Capt. Garland, was objectionable. 
 Plaintiff acknowledged the error as to terms ; but, does not appear to 
 have withdrawn the condition, mentioned in the letter, as to hiring 
 Captain Garland. However, plaintiff followed the telephone commu- 
 nication by a letter, using these words : "If there is anything about 
 the contract we sent you for your signature that you do not Tike, draw 
 up one and send it to us at once. A contract is, really, not necessary, 
 as we have your acceptance; but, it is best, in cases of this kind, to 
 have a thorough understanding so there will be no friction later. 
 * * * We are sorry to hear that you do not approve of Capt. Gar- 
 land as we consider him a good man for the business and we hope that 
 you will decide to forget the past and let him come up with her." To 
 that reply was promptly made that the tug had been leased to other 
 parties. Plaintiff thereupon hired the tug "Brower" which went out 
 - of commission in a few days and then secured the tug "Arthur" for re- 
 mainder of the season. Because of inferiority of the "Arthur" plain- 
 tiff was compelled to confine the fishing operations to a different dis- 
 trict than could have been reached by the tug "Tramp." Only 50 tons 
 of fish were secured during the season. The party who used the 
 Tramp secured 122% tons. The net profit on a ton of fish was $8. 
 
 At the close of the evidence, a motion in defendant's behalf for a di- 
 rected verdict was denied, upon the ground that the response by Mr. 
 Hawley to plaintiff's telegram, contained the words, "Close contract," 
 "Terms accepted;" that the reference to Capt. Garland was merely 
 advisory and that the letter which followed did not change the m'atter. 
 The cause was submitted to the jury with directions to find for the 
 plaintiff. * * * 
 
 The jury returned a verdict for $250, and judgment was rendered 
 thereon. 
 
 Marshai^Iv, J.'^ * * * The trial court construed the occurrences 
 between Mr. Hawley and respondent as having operated to close a con- 
 tract for the use of the former's tug boat, irrespective of whether Capt. 
 Garland was secured to command it, prior to receipt by Mr. Hawley 
 of the letter of November 3, 1907. The reasoning by which such con- 
 clusion was reached appears in the record, is sufficiently mentioned in 
 the statement and seems infirm in several particulars. 
 
 Much stress was placed upon the word sent by Mr. Hawley to re- 
 spondent in reply to the latter's offer to pay $300 for the season's use 
 of the tug. It is said in the judge's opinion, that these words were 
 used : "Close contract" "Terms accepted." ,We do not find the words 
 "Close contract" were used — ronly the words "Terms accepted. En- 
 gage Capt. Garland, writing." The only terms mentioned in the offer 
 were in these words : "Go for three hundred for thirty days. You pay 
 expenses one way." That was referred to in plaintiff's letter of No- 
 
 81 The statement of facts is abridged and part of the opinion is omitted. 
 
132 OFFER AND ACCEPTANCE (Ch. 1 
 
 vember 3d as an acceptance which closed a contract ; but it is plainly 
 not that. It was only a counter offer to the one mentioned in the com- 
 munication to Mr. Hawley, offering $300 for use of the tug for the 
 season to depend on conditions. The counter offer covered both sub- 
 jects. So up to this point there, certainly, had not been any meeting 
 of minds. ,The reply to the counter offer accepted the terms as to' 
 price and expense ; but, added the words "Engage Capt. Garland, writ- 
 ing." Such reply was quite ambiguous. The natural inference there- 
 from was that the terms mentioned by Mr. Hawley, as to compensa- 
 tion and length of the season, were accepted ; but that Capt. Garland 
 should be engaged to command the boat and an explanation would be 
 made by letter. The words "Engage Capt. Garland" and the word 
 "writing" were tied together and prettly plainly suggested that the con- 
 tractual details were still to be settled and the signification of the 
 words "Engage Capt. Garland, writing" would be made known in due 
 course. Now what followed by letter does not appear to have been 
 given due weight by the trial. judge in coming to a conclusion, as to 
 whether the reference to Capt. Garland was merely suggestive or mat- 
 ter of condition. Standing alone, it might fairly be construed to be 
 the former. Mr. Hawley seems to have been somewhat uncertain and 
 so made no immediate reply;, but, waited for the letter. When that 
 came it, doubtless, seemed quite plain to him that the actual closing of 
 the contract was, in the judgment of respondent, to wait upon accept- 
 ance of its choice of a person to command the boat and execution of a 
 written lease as to terms. 
 
 The letter stated with reference to the proposed- lease, "Please sign 
 one copy and return it to us at once so that we will know the matter is 
 settled." That plainly indicated it was not to be understood a contract 
 had been closed in advance of the writing being signed. The letter 
 further, unmistakably, indicates that the lease, as written, was not in- 
 tended to cover the entire matter. It made no reference to the condi- 
 tion contained in Mr. Hawley's letter as to respondent paying expenses 
 xDne way, nor to the ambiguous language in the telegram: "Engage 
 Capt. Garland." The former was covered in the letter thus : "We have 
 not mentioned this matter in the lease ; but we agree to pay expenses 
 one way en route." The latter was covered thus : "We wired you this 
 morning that your terms were accepted and to engage Capt. Garland, 
 and we will write him also and engage his services. We want no other 
 man if we can get him." Thus emphasizing the words of acceptance 
 as referring only to the price for use of the boat and the term of serv- 
 ice, and giving the reference to Capt. Garland the cast of a condition. 
 
 How could Mr. Hawley otherwise have understood the telegram 
 than as suggested in connection with the matter? If it be true that 
 respondent did not mean to convey such an idea; but used language 
 leading Mr. Hawley, in the exercise of ordinary care, to suppose it 
 did, it must bear the burden of its fault. He had a right to act upon 
 the meaning which respondent's words conveyed to him, if such, rea- 
 
Sec. 8) MEETING OF THE MINDS — MISTAKE 133 
 
 sonably, might be the meaning an ordinary careful person would read 
 out of such language under the same or similar circumstances. The 
 letter not only declared that respondent wanted no other person to 
 command the boat if he could be secured ; but, took the matter of set- 
 tling the question out of Mr. Hawley's hands, saying it would write 
 Capt. Garland and engage him. Nothing occurred thereafter indicat- 
 ing that Mr. Hawley was agreeable to placing his boat in charge of 
 Garland. On the contrary he made known, promptly, by telephone, 
 that he would not accede to that, but stand by his choice; which was 
 Capt. McClain. It does not appear that respondent receded till the 
 letter of November 3, 1909, was written. There the counter offer made 
 by Mr. Hawley October 27th before, was referred to as an acceptance, 
 — a very singular circumstance — showing a purpose to claim the exist- 
 ence of a contract by a misconstruction of Mr. Hawley's telegram. 
 There was nothing in the nature of an acceptance until the telegram 
 was sent by respondent in response to Mr. Hawley's counter offer. 
 Note the peculiar language of respondent's letter : "On the day we re- 
 ceived your wired acceptance of our offer we had almost concluded a 
 deal for the 'Curry'; but were very glad that we did not have to en- 
 gage her as she is altogether too slow. Now, however, we cannot, pos- 
 sibly, get along* without your boat as all other boats suitable for her- 
 ring fishing have been engaged." T^hat was followed by language sug- 
 gesting consent to Capt. McClain as cdmmander of the boat ; but still 
 showing preference for Capt. Garland. 
 
 It sedms clear that respondent did not recede from its demand un- 
 til it found it could not obtain the use of the boat on the condition it 
 had imposed and that there was no other boat obtainable. Before the 
 November 3d letter was received 'Mr. Hawley had leased his boat to 
 another party. Had the trial coijrt given proper significance to the 
 letter explaining the first reference to Garland, instead of leaving it 
 entirely out of view, as is clearly indicated in the opinion was done on 
 the motion to direct a verdict, and in some way viewed the case as if 
 respondent's reply to Mr. Hawley's counter offer contained the words 
 "close contract" when no such words were therein, it seems clear that 
 the conclusion would not have been reached that by such telegram, the 
 minds of the parties met and a contract was closed, irrespective of 
 whether Capt. Garland was engaged to command the boat or not. 
 
 In view of the foregoing, it is considered that the motion to direct 
 a verdict should have been granted. 
 
 The judgment is reversed and cause remanded with directions to 
 render judgment in favor of the defendant dismissing the cause with 
 costs. 
 
134 OFFER AND AQCBPTANCB (Ch. 1 
 
 MORSE V. KENNEY. 
 (Supreme Cdurt of Vermont, 1914. 87 Vt. 445, 89 Atl. 865.) 
 
 Action by Cleo D. Morse against Patrick Kenney. Judgment for de- 
 fendant, and plaintiif excepts. Judgment affirmed. 
 
 Taylor, J. This is an action of general assumpsit. Plea the gen- 
 eral issue and trial, by court. The plaintifif is a livery stable keeper 
 and seeks to recover for the board and care of a certain horse. One 
 JBadlam was the owner of the horse in question which 'sVas being kept 
 for him by the plaintifif. On May 25, 1911, the defendant, a farmer, 
 went to the plaintiff's stable to purchase a horse for use on his farm. 
 The plaintiff being absent, his servant, one ,Spaul ding, who was in 
 charge of the stable, told the defendant that the Badlam horse was for 
 sale ; that it was a good work horse, suitable for defendant's use on 
 his farm ; that it was able to draw reasonable loads ; and that it was 
 worth $50. Spaulding called Badlam by telephone and had some talk 
 with him (the nature of which and whether in the hearing of the 
 defendant does not appear from the findings), upon which he sold the 
 horse to the defendant for $50. The defendant paid the. purchase price 
 to Spaulding for Badlarn and took the horse home. 
 
 The defendant had not had much experience in dealing in horses 
 and was not much acquainted with their value. He relied wholly 
 upon Spaulding's representations, believing them to be true. The next 
 day he attempted to use the horse and found it "weak in its hind quar- 
 ters," unable to draw a small load, and unfit to perform ordinary farm 
 work. The defendant at once returned the horsp to the plaintiff's 
 stable, found Spaulding there, claimed the horse was not as represent- 
 ed, and asked to leave the horse where he got it ; but Spaulding re- 
 fused to accept the horse back and would not allow the defendant to 
 put it in the stable. The defendant hitched the horse to a ring just 
 outside the stable and went immediately to Badlam's place of business, 
 where he demanded the return of his money, which Badlam refused. 
 On plaintiff's return later the same day he found the horse hitched 
 outside ; knowing that the defendant had left it there for Badlam he put 
 it in the stable, fed and cared for it, and on the same day wrote the 
 defendant: "Your mare is here and it is 25^ a feed." Upon receiving 
 this' letter the defendant replied: "The mare you refer to is not mine. 
 Therefore don't look to me for any pay , for her feed." Plaintiff kept 
 the horse until July 12th, when this suit was brought for its board and 
 care. 
 
 Can the plaintiff recover in general assumpsit on the foregoing 
 facts? If S0, it must be upon the theory of ah implied promise to pay 
 for the board and care of the horse. 
 
 There are two kinds of implied contracts, as the term is ordinarily 
 used in the books : (1) Where the minds of the parties meet and their 
 meeting results 'in an unexpressed agreement; (2) where there is no 
 
Sec. 8) MEETING OF THE MINDS — MISTAKE 135 
 
 meeting of minds. Hdrley v. United States, 198 U. S. 229, 25 Sup. 
 Ct. 634, 49 L. Ed. 1029. The former class embraces true contracts 
 which are implied in the sense that the fact of the meeting of minds is 
 inferred. Such contracts are more accurately defined as resting upon 
 an implied promise in fact. The latter class embraces contractual ob- 
 ligations implied by the law where none in fact exist. 
 
 In many cases where there is no contract, the law upon equitable 
 grounds imposes an obligation often called quasi contractual. Harri- 
 man on Con. § 20. Such obligations are not contracts in the proper 
 sense, since they are created by law and not by the parties. Clark on 
 Con. 14, 27. In such so-called contracts the law creates a fictitious 
 promise for the purpose of allowing the remedy by action of assumpsit. 
 Though created by law and clothed with the semblance of a contract, 
 the obligation is not a contract at all. The proper term for such obli- 
 gations is "quasi contracts," a term borrowed from the Roman law. 
 Clark on Con. 752. They are called "quasi contracts" because, as the 
 term implies, they are not C(3'ntraicts at all, but have a semblance of 
 contract in that they may be enforced by an action of assumpsit. Keen- 
 er, Quasi Con. 3. Much of the apparent confusion in the cases arises 
 from a failure to distinguish clearly between implied contracts in fact 
 and contracts implied in law, or constructive contracts. 
 
 The plaintiff cannot maintain this action as upon an implied prom- 
 ise in f actf for such a promise is implied from the understanding of the 
 parties, inferred as a question of fact frorn their conduct and the sur- 
 rounding circumstances ; such facts and circumstances as show, ac- 
 cording to the ordinary course of dealing and the common understand- 
 ing of men, a mutual intent to contract. Wisconsin Steel Co. v. Mary- 
 land Steel Co., 203 Fed. 403, 121 C. C. A. 507. It is never inferred 
 against the express understanding of tlie parties. Lunay v. Vantyne, 
 40 Vt. 501. The defendant's assent is necessary to such a promise. 
 Mathiev. Hancock, 78 Vt. 4.14, 63 Atl. 143. 
 
 The source of the obligation, as in express contracts, is the inten- 
 tion of the parties. Bliss v. Hoyt's Estate, 70 Vt. 534, 41 Atl. 1026. It 
 is implied only when the facts warrant the inference of mutual ex- 
 pectation; the defendant expecting to pay for the service and the 
 plaintiff performing it relying upon that understanding. Parkhurst 
 V. Krellinger, 69 Vt. 375, 38 Atl. 67. It is implied only in this : It is 
 inferred from the conduct of the parties instead of from their spoken 
 words ; or, in other words, the contract is evidenced by conduct instead 
 of by words. 
 
 Unless the party benefited has conducted himself in such a manner 
 that his assent may fairly be inferred therefrom, he is not bound to pay. 
 Johnson v. B. & M. R. Co., 69 Vt. 521, 38 Atl. 267; Bliss v. Hoyt's 
 Estate, supra. Here the services sued for were performed in face of 
 the express and emphatic denial of liability by the defendant. 
 
 Do the facts found bring the plaintiff within the other class of 
 implied contracts ? In case of constructive or quasi contracts, the law 
 
136 OFFER. AND ACCEPTANCE ,(Ch. 1 
 
 infers the promise without reference to the iritention of the party, 
 and often against his express dissent, when he is under legal obliga- 
 tion, paramoynt to his will, to perform some duty. It was st:ch an 
 implied promise that is referred to in Penniman et al. v. Patchin, 5 Vt. 
 346, 353, cited by the plaintiff, wherein it was said : "The law does in 
 many cases imply a promise against the express dissent of the party." 
 An implied promise of this kind rests upon the equitable doctrine that 
 a man shall not be allowed to enrich himself unjustly at the expense 
 of another. Keener, Quasi Con. 19. The application of this principle 
 is illustrated by the action of assumpsit for money had and received, 
 which lies when one has the money of another which he has no right to 
 retain, but which, ex aequo et bono, he should pay over to the other-. 
 In such case no promise need be proved, because from such relation 
 between the parties, the law will imply a debt and give this action 
 founded on the equity of the plaintiff's case, as it were on a contract, 
 quasi ex contractu, and upon this debt founds the requisite undertaking 
 to pay. Clark on Con. 757. Such is th# case of one receiving money 
 paid him by .mistake, or of one obtaining money fraudulently. Bliss 
 v. Hoyt's Estate, supra. 
 
 In Wojahn v. Nat. Bank of Oshkosh, 144 Wis. 646, 129 N. W. 1068, 
 it is said: "A 'quasi contract' arises where there is a legal duty to 
 respond in money, which by legal fiction may be enforced as on an im- 
 plied promise; but in such case there is no element of contract so 
 called, but there is only the duty to which the law affixes a legal obliga- 
 tion of performance, as in case of a promise between the .parties." 
 To the same effect is a recent case in Illinois : "A quasi or implied con- 
 tract is one where liability exists from implication of. law arising from 
 facts and circumstances, independent of agreement or presumed inten- 
 tion, based on the doctrine of unjust enrichment; the implied agree- 
 ment being one defining the duty of thfe defendant rather than his in- 
 tention." Board of Com'rs v. Bloomington, 253 111. 164, 97 N-. E. 280, 
 Ann. Cas. 1913A, 471. The latter case contains a lucid discussion of 
 the subject. The same doctrine is recognized in Mathie v. Hancock, 78 
 Vt. 414, 417, 63 Atl. 143. The distinction has been tersely stated in 
 these words : "In the case of contracts, the agreement defines the duty, 
 while in case of qua'si contracts the duty defines the contract." Hertzog 
 v. Hertzog, 29 Pa. 465. See, also, C. H. V. & T. R. Co. v. Gaffney, 65 
 Ohio St. 104, 61 N. E. 152. 
 
 Applying these principles to the facts in this case, it is evident that 
 plaintiff cannot recover. The same result is reached whether the at- 
 tempt by the defendant to rescind the sale is rpgarded as effectual or in- 
 effectual. If effectual, then the horse was no longer his, and confessed- 
 ly no principle of equity and good conscience would demand that the 
 law imply a contract for its keeping against his express dissent. If inef- 
 fectual, and for that reason the horse remained his, when the plaintiff, 
 knowing the circumstances under which the horse was left by the de- 
 fendant outside his stable, saw fit to take charge of and care for it, he 
 
Sec. 8) MEETING OF THE MINDS — MISTAKE 137 
 
 acted as a volunteer. It cannot be said that the horse was left in the 
 plaintiff's possession so that a duty to care for it was cast upon him. 
 Mathie v. Hancock, supra. To be sure the defendant had asked Spaulr 
 ding to receive the horse back, but this request was co'upled with a de- 
 mand for the return of the purchase money, and his request was de- 
 nied. 
 
 The fact that the property is a live animal, in the absence of special 
 circumstances raising a duty to care for it, does not change the situa- 
 tion. The plaintiff cannot be held liable on an implied contract to pay 
 for that which he expressly declines to have done on his account, unless 
 the law imposes upon him an obligation to do something which he de- 
 clines to do, and which must be done to meet the legal requirement. 
 There is no such obligation upon one to retain and preserve his property, 
 whether it be live animals or anything else. He may abandon or destroy 
 it, if he pleases (Keith v. De Bussigney et al., 179 Mass. 255, 60 N. E. 
 614), subject of course to prohibitions of the statute against cruelty 
 to animals. The facts of this case do not disclose such necessity for 
 the plaintiff's interference, on grounds of humanity or otherwise, as 
 would authorize him to care for the horse at the defendant's expense 
 against his protest. The general rule is as was said in State v. St. 
 Johnsbury, 59 Vt. 332, 342, 10 Atl. 531, 535 : "One cannot thrust him- 
 self upon me &nd make me his debtor whether I will or not." The plain- 
 tiff fails to bring himself within the exceptions to this rule. This being 
 so, he must be taken at the; best to be a mere volunteer and so precluded 
 from recovering. Keener, Quasi Con.' 349 ; Johnson v. B. & M. R. Co., 
 supra. 
 
 Judgment afJSrmed. 
 
 ROBERTS V. JAMES. 
 
 (Court of Errors and Appeals of New Jersey, 1912. 83 N. J. Law, 492, 85 
 titL 244, Ann. Cas. 1914B,,859,) 
 
 Action by William T. B. Roberts against Benjamin F. James. Judg- 
 ment for plaintiff, and defendant brings error. Reversed, and venire 
 de novo awarded. 
 
 Action by vendor against purchaser to recover purchase price of lots. 
 The written agreement of sale requires the payment of the purchase 
 price in morithly installments, and provides that, upon default in pay- 
 ment, the yendor may treat the whole purchase money remaining un- 
 paid as immediately due and payable. The deed is to be delivered up- 
 on payment of the whole purcha.se money, and the purchaser, it is pro- 
 vided, shall have no right of possession until the deed is delivered. No 
 installment of purchase money has been paid. The defendant (the pur- 
 chaser) has never had possession. He defended upon the ground that 
 the contract was induced by fraudulent representations of the plain- 
 tiff's agent. Sands, by whom alone the contract on the part of the plain- 
 
138 OFFER AND ACCBPTANCB (Ch. 1 
 
 tiff was made. The lots were in a great field, and there was evidence 
 that Sands represented that there was going to be a hotel near by at a 
 spot pointed out by him, and that there was to be a railway station, 
 cement walks, a 'park with swings; that Roberts was back of the enter- 
 prise; that he was going to build 100 houses; that 25 were then con- 
 tracted for; that, when there were 50, they would get a railway sta^ 
 tion. The houses had not been built. There seems to be ho railway 
 station. The hotel was partly built, but sold by the sheriff, torn down, 
 and the lumber sold at auction. There was no proof of rescission of 
 the contract by the defendant, other than the fact that he defended this 
 suit on the ground of fraud. A verdict wa:s directed in favor of" the 
 plaintiff for the balance due upon the ground as stated by the trial 
 judge that there was no proof to go to the jury of a Ifegal rescission, 
 and that the alleged representations were mere promises. 
 
 SwAYZE, J.'^ (after stating the facts as above). It is settled that, 
 where a party seeks to be relieved from a contract upon the ground 
 that it was induced by fraud, he must, except so far as he has some le- 
 gal excuse for failure, restore his adversary to the position he was in at 
 the time of the contract, and that there can be no rescission as long as 
 he retains anything received under the contract, which he might have 
 returned, and the withholding of which might be injurious to the oth- 
 er party. This statement of the rule is taken from the opinion of the 
 Supreme Court in Byard v. Holmes, 33 N. J. Law, 119, 127. It has 
 been approved by this court. Crosby v. Wells, 73 N. J. Law, 790, 801, 
 67 Atl. 295. The reason upon which it rests is the injustice of per- 
 mitting a man to retain a benefit under a contract which he on his part 
 repudiates. By its terms the rule requires only the return of what has 
 been received. It is applicable only to a contract that has been partly 
 executed, and not to a contract that still remains wholly executory on 
 the part of the alleged fraud doer. In such a case the party who un- 
 dertakes to rescind has received no advantage, he has nothing to re- 
 turn, and all he can do is to deny his obligation under the contract. If 
 he does so in a reasonable time, he has rescinded, the contract. Even 
 where he has in fact received something under the contract, he is not 
 always bound to return it. The rule, "like other rules of justice, must 
 be so applied in the practical administration of justice as shall best sub- 
 serve, in each particular case, the undoing of wrong, and the vindica- 
 tion of the right." Pidcock v. Swift, 51 N. J. Eq. 405, 408, 27 Atl. 
 470; Guild, Ex'r, v. Parker, Receiver, 43 N. J. Law, 430; Doughten 
 V. Camden Building & Loan Ass'n, 41 N. J. Eq. 556, 7 Atl. .479. 
 
 It is also settled that one who desires to rescind a contract must act 
 within a reasonable time. Dennis v. Jones, 44 N. J. Eq. 513, 14 Atl. 
 913, 6 Am. St. Rep. 899; Clampitt v. Doyle, 73 N. J. Eq. 678, 70 Atl". 
 129. What is a reasonable time necessarily depends on the circum- 
 
 82 Part of the opinion is omitted. No attempt is made in this volume to 
 develop the subject of fraud, but it was thought that one case dealing with 
 the subject might be useful for purposes of legal analysis. 
 
Sec. 8) MEETING OP THE MINDS — MISTAKE ' 139 
 
 Stances of each particular case. It is settled in the English courts that, 
 unless the situation of the other party has changed to his detriment, 
 the contract continues until the party defrauded elects to avoid it, and 
 he may keep the question open as long as he does nothing to affirm the 
 contraict. Clough v. London & Northwestern Railway (1871) L. R. 7 
 Ex. 26, 41 L. J. Exch. 17; Morrison v. Universal Marine Ins. Co. 
 (1873) L. R. 8 Ex. 205, 42 L. J. Exch. 115; United Shoe Machinery 
 Co. of Canada v. Brunet, [1909] A. C. 330. He may even wait until 
 action is brought agaipst him (Clough v. London & Northwestern 
 Railway, ubi supra), and a plea setting up the fraud amounts to a re- 
 scission of the contract (Lawton v. Elmore, 27 L. J. Ex. 141 ; Dawes 
 v. Harness, L. R. 10 C. P. 166, 44 L. J. C. P. 194; Aaron's Reefs v. 
 Twiss, [1896] A. C. 273, 65 L. J. P. C. 54). The case last cited was an 
 action by a company against a shareholder for calls upon his stock. 
 In such cases the right of creditors and other stockholders to have the 
 stock paid for requires a prettipt disaffirmance of the subscription to 
 stock ; but, inasmuch as in the case before the court the rights pi 
 creditors and other stockholders were not involved, it Was held enough 
 to set up the fraud by way of defense when action was brought. Lord 
 Watson put the case very neatly. He said: "The respondent is not 
 seeking to rescind the contract. He is merely resisting its enforcement 
 by the party guilty of the fraud." 
 
 We have approved the same principle in a case where the'vendor of 
 chattels sought to rescind and reclaim his property because of the fraud 
 of the vendee. Williamson v. N. J. Southern R. Co., 29 N. J. Eq. 311, 
 319. We there said: "The vendor may rescind the contract of sale 
 and reclaim the property until, with a knowledge of the fraud, he 
 elects to ratify and confirm the sale, or third pessons, acting on the ap- 
 parent ownership of the property by the fraudulent vendee, acquire 
 rights therein bona fide and for a valuable consideration. Delay in ex- 
 ercising the power of rescission is evidence of an election to treat the 
 sale as valid, of more or less weight, according to the circumstances of 
 the case, but of itself does not operate as an estoppel, unless in the 
 meantime superior rights of third persons have intervened." In a 
 case like that then before us, rescission strictly so called is required, 
 since the contract has been executed by a delivery of the property. In 
 the case of an executory contract a refusal to perform any obligation 
 thereunder and the defense of an actign brought thereon are all that 
 the defrauded party can do by way of asserting his right to disaffirm' 
 the contract, and, unless his silence or delay has operated to the preju- 
 dice of the other party, he may first assert his right when his adversa- 
 ry first asserts his claim by action. The failure of the vendee to dis- 
 affirm the contract might sometimes prevent the vendor from selling to 
 another and a different question would arise from that now before us. 
 
 Here there is no proof that the plaintiff, the vendor, was in any way 
 prejudiced, except by his failure to receive the purchase money, and to 
 that he was not entitled, if the contract was induced by fraud. The 
 
140 OFFBE AND ACCBP:5ANCB , (Gh. 1 
 
 defendant repudiated his obligation at the very start by failing to pay 
 any installment of the price, and, if the plainf if? did not know the po- 
 sition taken by the defendant, he could easily have ascertained, it. itie 
 existence of the written contract, ho^yever, is an important circjm- 
 stance, since the plaintiff is entitled to be rid of his obligation" there- 
 under if he cannot enforce that of the defendant. Whether the con- 
 tract is recorded does not appear, but, whether recorded or not, it may 
 possibly affect the plaintiff's title. A recent illustration of the difficul- 
 ty that may arise is afforded by the case of Cornwall v. Henson (1900) 
 2 Ch. 298, We think, however, that the record of this suit, in which 
 the defendant disaffirms the contract, is sufficient to protect the plain- 
 tiff against future claim. Upon the judgment herein, the contract will 
 be either established as valid or annulled as void, and the question of 
 liability thereon will become res adjudicata. It is upon this basis that 
 the vendee is allowed to rescind at law by setting up fraud as a de- 
 fense to an action for the purchase price without being compelled to 
 go into equity — a right so well recognized that it is hardly necessary 
 to cite authority. Cases are collected in 39 Cyc. 1417, and 1916, note 
 59. We think, therefore, that the defendant was entitled to defend on 
 the ground that the contract was induced by fraud. 
 
 We. are unable to agree with the learned trial jtidge that there was 
 no evidence of fraud to go to the jury, because the false representa- 
 tions relied on by the defendant were mere promises. The represen- 
 tations that there were 25 houses contracted, and that the plaintiff was 
 back of the enterprise, were representations that such were the exist- 
 ing facts. The representation as to the intention to build a railway sta- 
 tion and cement walks stands on a somewhat different footing. It is, 
 however, settled that a representation of an intention as existing may 
 if false avoid a contract induced thereby. Where directors of a com- 
 pany procured a loan by representing that its object was to buy prop- 
 erty and develop the business, when, in fact, the object was to pay off 
 pressing liabilities, they were held in an action for deceit. "There 
 must be," said Lord Bowen, "a misstatement of an existing fact, but 
 the state of a man's mind is as much a fact as the state of his diges- 
 tion. It may be difficult to prove the state of a man's mind at a par- 
 ticular time, but, if it can be ascertained, it is as much a fact as any- 
 thing else. A misrepresentation as to the state of a man's mind is 
 therefore a misstatement of faqt." Edgington v. Fitzmaurice, L. R. 29 
 C. D. 483, 55 L. J. Ch. 650. The most familiar illustration perhaps is 
 the fraudulent purchase of goods by one who does not intend to pay 
 for them — a case in which there is usually no express representation of 
 intention, but merely the representation of an intent to pay implied 
 from the fact of purchase. Leake on Contracts, 294, 295. The New 
 York Court of Appeals has recently held that a statement by the gran- 
 tee tljiat he intends to erect a dwelling house on> the tract conveyed 
 while in fact he intends to erect a garage is a statement of a material 
 
Sec. 9) LAPSE OF OFFER — POWER OF REVOCATION 141 
 
 existing fact justifying the setting aside of the deed. Adams v. Gillig, 
 199 N. Y. 314, 92 N. E. 670. * * * 
 
 It was error to direct a verdict for the plaintiff, and the judgment 
 must be reversed, and a venire de novo awarded. 
 
 SECTION 9.— LAPSE OF OFFER— POWER OF REVOCATION 
 
 STARKWEATHER v. GLEASON. 
 (Supreme Judicial Court of Massachusetts, 1915. 221 Mass. 552, 109 N. B. 635.) 
 
 Actions by Helen Burr Starkweather and by William G. Stark- 
 weather against Frederick J. Gleason. There was a verdict for de- 
 fendant, and the case was reported to the Supreme Judicial Court. 
 Judgment ordered on the verdict. 
 
 BralEy, J. The correspondence between the parties would have 
 warranted the jury in finding that the plaintiffs invested in the pre- 
 ferred and common shares of the Walpole Rubber & Tire Company in 
 reliance on the advice and judgment of the defendant, its vice president 
 and general superintendent. And having called his attention to the 
 decline in market value of the stock, he wrote them from the company's 
 office, on March 26, 1913 : 
 
 If "at any time you feel really worried why come out and you can get 
 your money to the value you paid for the stock from me." 
 
 To which they replied, March 27, 1913 : . 
 
 "For the present * * * we will not take advantage of your will- 
 ingness to protect us, but will wait to see if the value of the preferred 
 drops any further, for if this continues we would not care to retain our 
 small holdings." 
 
 If this had been an unconditional acceptance the transaction would 
 have been closed and the plaintiffs, upon delivery of the certificates, 
 properly indorsed, would have been entitled to the amount invested. 
 It was not, however, until August 26, 1913, after a receiver for the 
 company had been appointed, that they accepted the offer and notified 
 the defendant of their readiness to deliver the stock, but he refused 
 performance. While the offer to buy was evidently for the purpose 
 of protecting them from loss on the investment, and was not interided 
 by the defendant as a purely business transaction, the words, "at any 
 time," do not cover an unlimited period to be measured by the alter- 
 nating hopes or fears of the plaintiffs, but must be construed as limited 
 to a reasonable time. Holland v. Cheshire R. R., 151 Mass. 231, 236, 
 24 N. E. 206. And the facts not being in dispute this was a question 
 of law for the court. Holbrook v. Burt, 22 Pick. 546, 555. The plain- 
 
142 OFFER AND ACCEPTANCE (Ch. 1 
 
 tiffs, with knowledge of the fluctuating financial condition of the 
 company, and the corresponding decline in the market price of the 
 stock, having reniained inactive for five months, we are of opinion 
 that under these circumstances the presiding judge correctly ruled that 
 the option had expired. Park v. Whitney, 148 Mass. 278, 19 N. E. 
 161. We find nothing in the remaining contents of these letters that 
 calls for discussion. By the terms of the report, judgment on the ver- 
 dict is to be entered for the defendant. 
 So ordered. 
 
 MINNESOTA LINSEED OIL CO. v. COLLIER WHITE 
 LEAD CO. 
 
 (United States Circuit Court, D. Blinnesota, 1876. 4 Dill. 431, Fed. Cas. 
 
 No. 9,635.) 
 
 This action was removed from the state court and a trial by jury 
 waived. The plaintiff seeks to recover the sum of $2,151.50, with 
 interest from September 20, 1875 — a balance claimed to be due for oil 
 sold to the defendant. The defendant, in its answer, alleges that on 
 August 3d, 1875, a contract was entered into between the parties, 
 whereby the plaintiff agreed to sell and deliver to the defendant, at the 
 city of St. Louis, during the said month of August, twelve thousand 
 four hundred and fifty (12,450) gallons of linseed oil for the price of 
 fifty-eight (58) cents per gallon, and that the plaintiff has neglected 
 and refused to deliver the oil according to the contract ; that the mar- 
 ket value of oil after August 3d and during the month was not less 
 than seventy (70) cents per gallon, and therefore claims a set-off or 
 counter-claim to plaintiff's cause of action. The reply of the plaintiff 
 denies that any contract was entered into between it and defendant. 
 
 The plaintiff resided at Minneapolis, Minnesota, and the defendant 
 was the resident agent of the plaintiff, at St. Louis, Missouri. The con- 
 tract is alleged to have been made by telegraph. 
 
 The plaintiff sent the following dispatch to the defendant: "Min- 
 neapolis, July 29, 1875. To Alex. Easton, Secretary Collier White Lead 
 Company, St. Louis, Missouri: Account of sales not enclosed in 
 yours of 27th. Please wire us best offer for round lot named by you — 
 one hundred barrels shipped. Minnesota Linseed Oil Company." 
 
 The following answer was received : "St. Louis, Mo., July 30, 1875. 
 To the Minnesota Linseed Oil Company : Three hundred barrels fifty- 
 five cents here, thirty days, no commission, August delivery. , Answer. 
 ColHer Company." 
 
 The following reply was returned : "Minneapohs, July 31, 1875. 
 Will accept fifty-eight cents (58c), on terms named in your telegram. 
 Minnesota Linseed Oil Company." 
 
 This dispatch was transmitted Saturday, July 31, 1875, at 9:15 p., m.. 
 
Sec. 9) LAPSE OF OFFEE — POWER OP REVOCATION 143 
 
 and was not delivered to the defendant in St. Louis, until Monday 
 morning, August 2, between eight and nine o'clock. 
 
 On Tuesday, August 3, at 8:53 a. m., the following dispatch was 
 deposited for transmission in the telegraph office : "St. L,ouis, Mo., 
 August 3, 1875. To Minnesota Linseed Oil Company, Minneapolis: 
 Offer accepted — ship three hundred barrels as soon as possible. Col- 
 lier Company." 
 
 The following telegrams passed between the parties after the last one 
 was deposited in the office at St. Louis : "MinneapoUs, August 3, 1875. 
 To Collier Company, St. Louis : We must withdraw our offer wired 
 July 31st. Minnesota Linseed Oil Company." 
 
 Answered: "St. Louis, August 3, 1875. Minnesota Linseed Oil 
 Company: Sale effected before your request to withdraw was re- 
 ceived. When will you ship ? Collier Company." 
 
 It appeared that the market was very much unsettled, and that the 
 price of oil was subject to sudden fluctuations during the month pre- 
 vious and at the time of thi.s negotiation, varying from day to day, 
 and ranging between fifty-five and seventy-five cents per gallon. It 
 is urged by the defendant that the dispatch of Tuesday, August 3d, 
 1875, accepting the offer of the plaintiff transmitted July 31st, and de- 
 livered Monday morning, August 2d, concluded a contract for . the 
 sale of the twelve thousand four hundred and fifty gallons of oil. The 
 plaintiff, on the contrary, claims, 1st, that the dispatch accepting the 
 proposition made July 31st, was not received until after the offer had 
 been withdrawn ; 2d, that the acceptance of the offer was not, in due 
 time ; that the delay was unreasonable, and therefore no contract was 
 completed. 
 
 Nelson, District Judge. It is well settled by the authorities in this 
 country, and sustained by the later English decisions, that there is no 
 difference in the rules governing the negotiation r of contracts by corre- 
 spondence through the post-office and by telegraph, and a contract is 
 concluded when an acceptance of a proposition is deposited in the tele- 
 graph office for transmission. See 14 Am. Law Reg. 401, "Contracts by 
 Telegraph," article by Judge Redfield, and authorities cited; also, 
 Trevor v. Wood, 36 N. Y. 307, 93 Am. Dec. 511. 
 
 The reason for this- rule is well stated in Adams v. Lindsell, 1 Bam. 
 & Aid. 68L The negotiation in that case was by post. The court said : 
 
 "That if a bargain could not be closed by letter before the answer 
 was received, no contract could be completed through the medium of the 
 post-office ; that if the one party was not bound by his offer when it was 
 accepted (that" is, at the time the letter of acceptance is deposited in the 
 mail), then the other party ought not to be bound until after they had 
 received a notification that the answer had been received and assented 
 to, and that so it might go on ad infinitum." See, also, Hamilton v. 
 Lycoming Mut. Ins. Co., 5 Pa. 339, Vassar v. Camp, 11 N. Y. 441; 
 Mactier v. Frith, 6 Wend. (N. Y.) 103, 21 Am. Dec. 262; Abbott v. 
 
Hi OFFER AND ACCEPTANCE (Ch. 1 
 
 Shepard, 48 N. H. 14; 8 C. B. 225. In the case at bar the delivery of 
 the message at the telegraph office signified the acceptance of the offer. 
 If any contract was entered into, the meeting of minds was at 8 :53 of 
 the clock,, on Tuesday morning, August 3d, and the subsequent dis- 
 patches are out of the case. 1 Pars. Cont. 482, 483. 
 
 This rule is not strenuously dissented from on the argument, and it 
 is substantially admitted that the acceptance of an offer by letter or 
 telegraph completes the contract, when such acceptance is put in the 
 proper and usual way of being communicated by the agency employed 
 to carry it; and that when an offer is made by telegraph, and accept- 
 ance by telegraph takes effect when the dispatch containing the ac- 
 ceptance is deposited for transmission in the telegraph office, and not 
 when it is received by the other party. Conceding this, there remains 
 only one question to decide, which will determine the issues : Was the 
 acceptance of defendant deposited in the telegraph office Tuesday, 
 August 3d, within a reasonable time, so as to consummate a contract 
 binding upon the plaintiff ? 
 
 It is is imdoubtedly the rule that when a proposition is made under 
 the circumstances in this case, an acceptance concludes the contract 
 if the offer is still open, and the mutual consent necessary to convert 
 the offer of one party into a binding contract by the acceptance of the 
 other is established, if such acceptance is within a reasonable time 
 after the offer was received. 
 
 The better opinion is, that what is, or is not, a reasonable time, must 
 depend upon the circumstances attending the negotiation, and the 
 character of the subject matter of the contract, and in no better way 
 can the intention of the parties be determined. If the negotiation is in 
 respect to an article stable in price, there is not so much reason for an 
 immediate acceptance of the offer, and the same rule would not apply 
 as in a case where the negotiation related to an article subject to sud- 
 den and great fluctuations in the market. 
 
 The rule in regard to the length of the time an offer shall continue, 
 and when an acceptance completes the contract, is laid down in Parsons 
 on Contracts (volume 1, p. 482). He says : "It may be said that whether 
 the offer be made for a time certain or not, the intention or understand- 
 ing of tlie parties is to govern. * * * If no definite time is stated, 
 then the inquiry as to a reasonable time resolves itself into an inquiry 
 as to what time it is rational to suppose the parties contemplated ; and 
 the law will decide this to be that time which as rational men they 
 ought to have understood' each other to have had in mind." Applying 
 this rule, it seems clear that, the intention of tlie plaintiff, in making 
 the offer by telegraph, to sell an article which fluctuates so much in 
 price, must have been upon the understanding that the acceptance, 
 if at all, should be immediate, and as soon after the receipt of the offer 
 as would give a fair opportunity for consideration. The delay here 
 was too long, and manifestly unjust to the plaintiff, for it afforded the 
 
StC. 9) LAPSE OP OFFER — POWER OP REVOCATION 145 
 
 defendant an opportunity to take advantage of a change in the market, 
 and accept or refuse the offer as would best subserve its interests. 
 
 Judgment will be entered in favor of the plaintiff for the amount 
 claimed. The counter-claim is denied. Judgment accordingly.** 
 
 MACTIER'S ADM'RS v. FRITH. 
 (Court of Errors of ]^ew York, 1830. 6 Wend. 103, 21 Am. Dec. 262.) 
 
 Appeal from chancery. 
 
 At New York, in the autumn of 1822, the respondent and Henry 
 Mactier the intestate, agreed to embark in a commercial adventure, 
 in which they were to be jointly and equally interested. Frith was to 
 direct a shipment of 200 pipes of brandy from France to N. Y., to be 
 consigned to Mactier, who was to ship to the respondent at Jacmel in 
 St. Domingo, provisions to the amount of the invoice cost of the brandy, 
 and the respondent was to place the shippers of the brandy in funds 
 by shipments of coffee to France in French vessels, and the parties 
 were to share equally in result of the speculation all around. In pur- 
 suance of this arrangement. Frith, Sept. 5, 1822, wrote Firebrace, Da- 
 vidson & Co., a mercantile house at Havre, to ship 200 pipes of brandy 
 to N. Y. to the consignment of Mactier. Dec. 24, Frith, who had re- 
 turned to Jacmel, where he did business as a merchant, wrote a letter 
 to Mactier on a variety of subjects, in which was contained a para- 
 graph in these words : "I also have the pleasure of handing you copies 
 of Messrs. Firebrace, Davidson & Co.'s letters regarding the brandy 
 order. By-the-bye, as your brother before I left New York, declined 
 taking the interest I offered him in this speculation, and wishing to 
 confine myself in business as much as possible, so as to bring my con- 
 cerns to a certain focus, I would propose to you to take the adventure 
 solely to your own account, holding the value to cover the transaction to 
 my account in New York." 
 
 83 wiien no limit Is si)ecified, the power of acceptance lasts only a reason- 
 able time, this yarymg with the circumstances. Averill v. Hedge, 12 Conn. 424 
 (1838), offer made, and after two weeks' delay renewed on the 18th ; accept- 
 ance mailed on 20th held too late ; Caldwell v. E. P. Spears & Sons, 186 Ky. 
 64, 216 S. W. 83 (1919) ; Maclay v. Harvey, 90 111. 52S, 32 Am. Eep. 35 (1878) ; 
 Traylor, Spencer & Co. v. Brimbery, 2 Ga. App. 84, 58 S. B. 371 (1907) ; Ort- 
 man v. Weaver (O. C.) 11 Fed. 358 (1882); Stone v. Harmon, 31 Minn. 512, 
 19 N. W. 88 (1884) ; Baker v. Holt, 56 Wis. 100, 14 N. W. 8 (1882). As to 
 when an ofEer of a reward would lapse, see Loring v. City of Boston, 7 Mete. 
 (Mass.) 409 (1844) ; Mitchell v. Abbott, 86 Me. 338, 29 Atl. 1118, 25 L. R. A. 
 503, 41 Am. St. Eep. 559 (1894) ; Matter of Kelly, 39 Conn. 159 (1S72). Where 
 a reward is ofCered for information, the power of acceptance lapses as soon as 
 the information is given by the first informer. Lancaster v. Walsh (Exch.) 4 
 M. & W. 16 (18^8)-. 
 
 Where there is a time limit specified, the power ends instantly at the ex- 
 piration of this time. This is equally true in the case of irrevocable powers, 
 called option contracts. Berg Co. v. Thomas & Son Co., 256 Pa. 584, 100 Atl. 
 951 (1917) ; Mackey Wall Plaster Co. v. United States Gypsum Co. (D. 0.) 244 
 Fed. 275 (1917). 
 
 COEBIN CONT 10 
 
146 OFFER AND ACCEPTANCE (Ch. 1 
 
 Jan. 17, 1823, Mactier wrote to Frith, acknowledging the receipt of 
 his letter of the 24th ult. ; thanks him for sending the copy of Firebrace, 
 .Davidson & Co.'s letter on the subject of the brandy order; says that 
 he has received a letter from them, informing that the brandy would 
 be shipped and leave Bordeaux about Dec. 1 then past; and adds: 
 "This has been from the first a favorite speculation with me, and am 
 pleased to say it still promises a favorable result ; but to render it com- 
 plete, I am desirous the speculation should go forward in the way first 
 proposed, thereby making it a treble operation; as you have, how- 
 ever, expressed a wish that I should take the adventure to my own ac- 
 count, I shall delay coming to any determination till I again hear from 
 you. The prospect of war between France and Spain may defeat the 
 object of this speculation, as far as relates to the shipment of provi- 
 sions hence to Hayti to be invested in coffee for France, in which case I 
 will at once decide to take the adventure to my own account. Our Lon- 
 don accounts, down to the fifth of December, speak confidently of a 
 war between France and Spain, a measure which, if carried into effect, 
 would operate to your disadvantage." Also : "The next arrival from 
 Europe will probably decide the question of peace or war, and I will 
 lose no time in communicating the same to you ;'' and also, "let what 
 will happen, I trust you will in no way be a sufferer." 
 
 March 7, 1823, Frith wrote Mactier, making no other allusion to the 
 last letter of Mactier than the following: "I have received your es- 
 teemed favors of the 17th and 31st January, and note their respective 
 contents." March 12, 1823, the shipLa Claire arrived at N. Y., laden 
 with the brandy in question, and was at the wharf on the morning of 
 March 13. 
 
 A clerk of Mactier testified that he had a conversation with Maotier 
 about the time the brandy arrived, perhaps the morning after, and 
 Mactier then said he should take it to himself. A merchant of N. Y. 
 also testified that Mactier consulted with him on the subject of some 
 brandy which he expected to arrive ; there was some offer for his tak- 
 ing it on his own account, and he appeared inclined to take it. From 
 the state of things, he advised Mactier to take it, and there was a 
 letter drafted by Mactier upon the subject, in which the merchant made 
 some alterations. The letter stated that he, Mactier, should take the 
 brandy to his own account. March 17, Mactier entered the brandy at 
 the custom-house as owner, and not as consignee, took the usual oath, 
 and gave bond for the duties. March 22, he sold 150 pipes of the bran- 
 dy on the wharf to several commercial houses, and took their notes for 
 the price of the same. The remaining SO pipes were put in the public 
 store, and remained there in bond, the liquidated duties not having been 
 secured to be paid by Mactier. 
 
 March 25, Mactier wrote a letter, directed to Frith at Jacmel, in 
 which he said, "I have now to advise the arrival of French ship L,a 
 Claire with the 200 pipes of brandy, and that in consequence of the 
 probability of war between France and Spain, and in compliance with 
 
Sec. 9) LAPSE OP OFFER — POWER OP REVOCATION 147 
 
 the wish expressed in your regarded favor of the 24th December and 
 my answer thereto of the 17th January last, I have decided to take this 
 adventure to my own account. I, therefore, credit you with the amount 
 of the invoice," amounting to $14,254.57. To this letter was attached 
 a postscript, dated March 31. 
 
 March 28, Frith wrote a letter to Mactier, dated at Jacmel, in which, 
 speaking of the brandy in question he says : "With regard to this ad- 
 venture, I would wish to confirm, if altogether satisfactory to you, what 
 I mentioned to you some time ago, and which I omitted to repeat to you 
 in my previous letter, in reply to yours of the 17th January. I find the 
 more one does in this country, in the present state of trade, the more 
 one's affairs get shackled." Previous to the arrival of these last two 
 letters at their respective places of direction, Mactier was dead, he hav- 
 ing departed this life April 10, 1823. April 21, Frith again wrote a let- 
 ter addressed to Mactier, in which he acknowledges the receipt of his 
 letter of March 25, says he has noted its contents, and requests Mactier 
 to charter on his account a staunch first-class vessel, and send out to 
 Jacmel by her 400 barrels of flpur and other goods. Meantime, Mactier 
 having died, his administrator pbtained the rest of the brandy from the 
 custom house and sold it at auction. 
 
 The respondent,, unwilling to come in as a general creditor of Mactier 
 and receive a pro rata distribution, filed his bill in the court of chancery, 
 on April 1, 1824, alleging that the brandy was shipped from France on 
 his sole account, and that Mactier was only the consignee thereof. He 
 admits having offered to sell. the brandy to Mactier, but declares that he 
 regarded his offer as declined by the letter of Jan. 17. He sets forth a 
 letter written by Mactier on March 13, 1823, in which he writes of the 
 brandy as follows : "1 am looking daily for its arrival ; it is to be re- 
 gretted the order was not more promptly executed, as the delay, I fear, 
 will operate to our disadvantage. War between France and Spain 
 may now be considered inevitable; France has recalled her minister, 
 and 100,000 Frenchmen have been ordered to march into Spain." He 
 alleges that the letter of Mactier to him of March 25 was not received 
 until several days^after the death of Mactier, and that his letter to 
 Mactier of April 21 was written in ignorance of the death of Mactier, 
 and that he did not intend thereby, and he conceives he did not finally 
 consummate the sale as claimed. 
 
 The bill concludes by praying an account of the sales of the brandy, 
 and a decree directing the defendants to retain in their hands sufficient 
 of the funds belonging to the estate of Mactier to pay and satisfy the 
 respondent when his accounts shall be settled and adjudged upon by 
 the court. 
 
 The defendants put in their answer, insisting that the brandy, on its 
 arrival at the port of New York, was the sole and exclusive property of 
 Mactier, and that the portion thereof which came to their hands at his 
 decease, and the proceeds of that part thereof which was sold by him 
 in his lifetime, and which came to their hands, rightfully belonged to 
 
148 OFFER AND ACCEPTANCE (Ch. 1 
 
 his estate, and was subject to be disposed of in a due course of admin- 
 istration. , 
 
 On March 1, Mactier had effected an insurance on his commissions 
 as consignee of the brandy, to the amount of $1,500; but on March 17, 
 he had entered the brandy in the custom house as his own, using an in- 
 voice stating that the brandy was shipped "to the address and for the 
 account of Henry Mactier." On the date of such entry, a clerk had 
 charged a small custom house fee to "John A. Frith's sales of brandy" 
 on Mactier's books ; but later Mactier directed the account to be made 
 out to himself, and on March 28 Frith was credited on the books with 
 the invoice price of the brandy. 
 
 On May 20, 1825, Chancellor Sanford made an order referring the 
 case to a master to examine witnesses and report. The master report- 
 ed on Oct. 10, 1825, that the sale had been consummated and that Frith 
 had no lien on the brandy and no rights other than those of a general 
 creditor. The complainant excepted to this report, and the Chancellor 
 subsequently sustained the exceptions and decreed that Frith was en- 
 titled to the specific proceeds of the sale of the brandy. From this de- 
 cree the defendants appealed.** 
 
 Maecy, J. The object of the bill filed in this case is to obtain from •, 
 the administrators of Mactier the proceeds of the 50 pipes of brandy 
 which came to their possession after his death, and the amount of such 
 notes taken on the sale of the 150 pipes, March 22, 1823, as were un- 
 collected and undisposed of at the death of Mactier, or, at least, so 
 much thereof as may be necessary to pay the balance due the respond- 
 ent for disbursements on account of the adventure. The question on 
 which the decision in this case, as I apprehend, mainly depends, relates 
 to the alleged sale of the brandy to Mactier. There are many defini- 
 tions of what constitutes a contract, but all of them are, of course, sub- 
 stantially alike. Powell states a contract to be a transaction rin which 
 each party comes under an obligation to the other, and each reciprocal- 
 ly acquires a right to what is promised by the other. Pow. Cont. 4. 
 In testing the validity of contracts, many things are to be considered. 
 The contract that the appellant sets up in this case is alleged by the re- 
 spondent to be deficient in several essential requisites. When that was 
 done which, on the assumption of there being parties capable of con- 
 tracting, ' was necessary, as the respondent contends, to complete it, 
 Mactier was dead. If the contract was only in progress of execution, 
 and there remained but a single act to be done to complete it, his death 
 rendered the performance of that act impossible ; it suspended the pro- 
 ceedings at the very point where they were when it occurred. 
 
 [The learned judge here discussed the question whether an act per- 
 formed, after Mactier's death might not be operative by the doctrine 
 of "relation back" as if performed prior to his death.] 
 
 84 The statement of facts lias been rewritten In part, the opinion of Marcy, 
 J., has been abbreviated, and several opinions of other judges have been 
 omitted. 
 
Sec. 9) LAPSE OF OFFER — ^POWEB OF REVOCATION 149 
 
 My conclusion, in regard to this objection to the alleged contract, is, 
 that if any act was required to be done, even by Frith, to complete the 
 sale when Mactier died, that act could not be subsequently performed. 
 
 I am now to consider whether there was a contract, before Mactier's 
 death, which had the consent of the contracting parties so given and 
 made known as to be binding on them. That a consent is necessary all 
 agree, but what shall constitute it in a given case may admit of much 
 diversity of opinion. The consent of the parties in a contract of sale, 
 as explained by Pothier, consists in the concurrence of the will of the 
 vendor to sell a particular thing to the purchaser for a specified price, 
 with the will of the purchaser to buy the same thing for that price. 
 Poth. Gont. de Vente, pi. 1, § 2, art. 3, No. 31. Delvincourt, another 
 eminent French writer on the Civil Code of France, says, that although 
 it is impossible that there shotild be a contract without the consent of all 
 parties, it is not indispensable that the wills of the parties should con- 
 cur at the same instant, provided the will of the one that did not concur 
 at first, is declared before the will of the other is revoked. 5 Cours de 
 Code Civil, 93. Although the will of the party making the offer may 
 precede that of the party accepting, yet it must continue down to the 
 time of the acceptance. Where parties are together chaffering about 
 an article of merchandise, and one expresses a present willingness to 
 accept of certain terms, that willingness is supposed to continue, unless 
 it is revoked, to the close of their interview and negotiation on the 
 same subject, and if during this time the other party says he will take 
 the article on the terms proposed, the bargain is thereby closed. Poth. 
 Cont. de Vente p. 1, § 2, art. 3, No. 31. What I mean by its being closed 
 is, that nothing mutual between the parties remains to be done to give 
 to either a right to have it carried into effect; either can enforce it 
 against the other, or recover damages for the nonfulfillment of it : but 
 if there be conditions expressed or implied to be performed by the pur- 
 chaser, he cannot compel the delivery until they are performed. If the 
 price is to be immediately paid or security given, he cannot have the 
 property until payment made, or security given, or a tender thereof. 
 Touch. 204, 205; Noy, Max. c. 42; 2 Bl. Comm. 447. 
 
 Where the negotiation between the contracting parties residing at a 
 distance from each other is conducted, as it usually is by letters, it is 
 necessary, in order that their minds may meet, that the will of the par- 
 ty making the proposition to sell should continue until his letter shall 
 have reached the other, and he shall have signified, or at least had an 
 opportunity to signify his acceptance of the proposition. This Pothier 
 holds to be the legal presumption unless the contrary appears, His lan- 
 guage is : "Cette volonte est presum.ee taut qu'il ne parait rien de con- 
 traire." This doctrine, which presumes the continuance of a willing- 
 ness to contract after it has been manifested by an offer is not confined 
 to the civil law and the codes of those nations which have constructed 
 their systems with the materials drawn from that exhaustless store- 
 house of jurisprudence: it is found in the common law; indeed, it 
 
150 OFFER AND ACCEPTANCE (Ch. 1 
 
 exists, of necessity, wherever the power to contract exists in parties 
 separated from each other. The rule of the common law is, that wher- 
 ever the existence of a particular subject-matter or relation has been 
 once proved, its continuance is presumed till proof be given to the con- 
 trary, or till a different presumption be afforded by the nature of the 
 subject-matter. 16 East, 55 ; 3 Starkie, Ev. 1252. The case of Adams 
 v. L,indsell, 1 Barn. & Aid. 681, proceeds upon and affirms the principle 
 that the willingness to contract thus manifested is presumed to con- 
 tinue for the time limited, and, if that be not indicated by the offer, 
 until it is expressly revoked or countervailed by a contrary ()resump- 
 tion. In that case it was said, "The defendants must be considered in 
 law as making during every instant of time their letter was traveling 
 the same identical offer to the plaintiffs ; and then the contract is com- 
 plete by the acceptance of it by the latter." 
 
 Against the authority of the case of Adams v. Lindsell, we have 
 urged on us a decision of a court of the highest respectability in one 
 of our sister states. The case of McCulloch v. Insurance Co., 1 Pick. 
 (Mass.) 278, conflicts in principle, according to my views of it, with 
 the case decided by the King's Bench. I should have been pleased tO' see 
 these tribunals harmonize upon a question of no small importance to 
 the commercial world ; and I have, therefore, deliberately weighed the 
 ingenious attempts made to reconcile these decisions upon this point; 
 but these attempts appear to me to have been unsuccessful. A refine- 
 ment which would distinguish between a contract for insurance, and 
 one for the sale of goods in relation to the assent of the parties, might 
 relieve us from the embarrassment which the different principles of 
 these decisions is calculated to produce ; but to apply such a distinction 
 hereafter would doubtless involve courts in a still more distressing em- 
 barrassment. Distinctions, which are not founded on a difference in 
 the nature of things, are not entitled to indulgence ; they tend to make 
 the science of law a collection of arbitrary rules appealing to factitious 
 reasons for their support, consequently difficult to be acquired, and 
 often of uncertain application. The two cases referred to should have 
 had applied to them the same rule of law, and we are required to say 
 what that rule, is in deciding the case now under consideration. 
 
 The principle of the decision of the King's Bench is simply that the 
 acceptance of an offer made, through the medium of a letter, binds the 
 bargain if the party making the offer has not revoked it, as he has a 
 right to ,do before it is accepted. The rule laid down by the supreme 
 court of Massachusetts regards the contract as incomplete until the 
 party making the offer is notified of the acceptance, or until the time 
 when he should have received it, the party accepting having done what 
 was incumbent on him to give notice. The chancellor in deciding this 
 case gave his sanction to the latter rule : "To make a valid contract," 
 he says, "it is not only necessary that the minds of the contracting par- 
 ties should meet on the subject of the contract, but they must know 
 that fact." The decision of the court of Massachusetts makes knowl- 
 
Sec. 9) LAPSE OP OFFEB — POWER OF EEVOCATION 151 
 
 edge by the party tendering the offer of the other's acceptance essential 
 to the completion of the contract. If one party is not bound till he 
 knows or might know, and therefore is presumed to know that the oth- 
 er has accepted, the accepting party, on the same principle, ought not to 
 be bound till he knows the offering party has not recalled the offer be- 
 fore knowledge of the acceptance. The principle of that case would 
 bring the matter to the point stated by the chancellor, viz. : the par- 
 ties must know that their minds meet on the subject of the contract. If 
 a bargain can be completed between absent parties, it must be when one 
 of them cannot know the fact whether it be or be not completed. It 
 cannot begin to be obligatory on the one before it is on the other; 
 there must be a precise tim^when the obligation attaches to both, and 
 this time must happen when one of the parties cannot know that the 
 obligation has attached to him; the obligation does not, therefore, arise 
 from a knowledge of the presetit concurrence of the wills of the con- 
 tracting parties. 
 
 All the authorities state a contract or an agreement (which is the 
 same thing) to be aggregatio mentium. Why should not this meeting 
 of the minds, which makes the contract, also indicate the moment when 
 it becomes obligatory ? I might rather ask, is it not and must it not be 
 the moment when it does become obligatory? If the party malting the 
 offer is not bound until he knows of this meeting of minds, for the 
 same reason the party accepting the offer ought not to be bound when 
 his acceptance is received, because he does not know of the meeting of 
 the minds, for the offer may have been withdrawn before his accept- 
 ance was received. If more than a concurrence of minds upon a dis- 
 tinct proposition is required to make an obligatory contract, the defini- 
 tion of what constitutes a contract is not correct. Instead of being the 
 meeting of the minds of the contracting parties, it should be a knowl- 
 edge of this meeting. It was said on the argument that if concurrence 
 of minds alone would make a valid contract, one might be constiructed 
 out of mere volitions and uncommunicated wishes ; I think such a re- 
 sult would not follow. The law does not regard bare volitions and 
 pure mental abstractions. When it speaks of the operations of the 
 mind it means such as have been made manifest by overt acts ; when 
 it speaks of the meeting of minds it refers to such a meeting as has 
 been made known by proper acts, and when thus made known it is ef- 
 fective although the parties who may claim the benefit of or be bound 
 by a contract thus made, may for a season remain ignorant of its be- 
 ing made. 
 
 Testing the rules of the law laid down in the two cases to which I 
 have referred by the authority of reason, and the practical results that 
 are likely to^flow from them, it does appear to me, that we are not left 
 at liberty to hesitate about the choice. If we are inclined from the 
 force of abstract reason, to prefer the rule laid down by the Court of 
 King's Bench, that inclination will be greatly strengthened by a recur- 
 rence to the opinions of courts and jurists. The Common Pleas in Eng- 
 
] 52 OFFER AND ACCEPTANCE (Ch. 1 
 
 land seem to me to have given their approval to the decision of Adams 
 V. Lfindsell. Routledge v. Grant, 4 Bing. 653. Judge Washington, in 
 delivering the opinion of the court, in Eliason v. Henshaw, 4 Wheat. 
 228, 4 h. Ed. 556, said, "Until the terms of the agreement have received 
 the assent of both parties the negotiation is open and imposes no obli- 
 gation on either." The inference from this proposition is that the as- 
 sent of the parties to the terms of the agreement and not their knowl- 
 edge of it, completes the contract. It was decided in the circuit court of 
 the United States, for Pennsylvania, that contracts are formed by the 
 offer on the one hand, and an acceptance on the other. After accept- 
 ance, the contract is obligatory on both. Co'xe, Dig. 192. In this case, 
 knowledge of the acceptance is not brou^t into view as necessary to 
 constitute the obligation. Both the Roman law and the French Civil 
 Code, as we have seen by the references already made, contain a doc- 
 trine in accordance with the principle' of these cases. I think I am, 
 therefore, warranted in saying that the prof>osition may be considered 
 as established, that tlie acceptance of a written offer of a contract of 
 sale consummates the bargain, providing the offer is standing at the 
 time of the acceptance. 
 
 What shall constitute an acceptance will depend, in a great measure, 
 upon circumstances. The mere determination of the mind, unacted 
 on can never be an acceptance. Where the offer is by letter, the usual 
 mode of acceptance is the sending of a letter announcing a consent to 
 accept; where it is made by a messenger, a determination to accept, 
 returned through him, or sent by another, would seem to be all the 
 law requires, if the contract may be consummated without writing. 
 There are other modes which are equally conclusive upon the parties; 
 keeping silence, under certain circumstances, is an assent to a proposi- 
 tion; anything that shall amount to a manifestation of a formed de- 
 termination to accept, communicated or put in the proper way to be 
 communicated to the party making the offer, would doubtless complete 
 the contract ; but a letter written would not be an acceptance, so long 
 as it remained iti the possession or under the control of the writer. 
 An acceptance is the distinct act of one party to the contract as much 
 as the offer is of the other; the knowledge by the party making the 
 offer, of the determination of the party receiving it, is not an ingredi- 
 ent of an acceptance. It is not compounded of an assent by one party 
 to the terms offered, and a knowledge of that assent by the other. 
 
 I will now apply this law to the facts of this case. Frith's offer to 
 sell his interest in the brandy certainly continued till his letter of Dec. 
 24 was received at New York and Mactier had a fair opportunity to 
 answer it. If the answer of Jan. 17 had contained an unqualified ac- 
 ceptance, the bargain' would have been closed when it was sent away 
 for Jacmel; but the offer was not then accepted; there was a promise 
 to accept upon a contingency, for Mactier says, after alluding to the 
 prospect of a war between France and Spain, "in which case," that is 
 in case of such a war, "I will at once decide to take the adventure to 
 
Sec. 9) LAPSE OF OPFEE — POWER OP REVOCATION 153 
 
 my own account." This concluded nothing. If the event had actually 
 happened, and Frith had insisted on enforcing this conditional accept- 
 ance, it would not have been in his power to do so. The most that 
 Mactier said was, that if an expected event happened, he would do an 
 act which would complete the bargain. The happening of the event 
 could not, without the act, complete it. The Roman law, regarded the 
 tense of the^ verb used by the contracting parties to determine whether 
 the bargain was concluded : "Verbum imperfecti temporis rem adhuc 
 imperfectam significat." There is a wide difference between a promise 
 to give an assent to a proposition for a contract on the happening of a 
 contingency, and the annunciation of a present assent to it. If the ex- 
 pected event happens, and the act promised is performed, the bargain is 
 closed; but it is the promised acceptance, and not the happening of 
 the event, that gives validity to the contract. If in this case the offer 
 of Frith had been to Mactier to take the brandy on the happening of a 
 French and Spanish war, and Mactier had promised to decide to take 
 it in such an event, the simple fact of his taking it after the war would 
 have enabled Frith to treat him as the purchaser of it. Such an act 
 would have been a valid acceptance; but a conditional acceptance of 
 an unconditional offer, followed up by acts of the acceptor after the 
 condition was fulfilled on which the acceptance depended, might not 
 be considered as completing the bargain without the acquiescence of 
 the. party making the offer in those acts, because the minds of the par- 
 ties would not have met on the precise terms of the contract. 
 
 To conclude the bargain, Mactier must have accepted the offer as 
 tendered to him by Frith, and that acceptance must have been while 
 the offer, in contemplation of law, was still held out to him. That 
 there was an acceptance, or rather that Mactier did all that was in- 
 cumbent on him to do, to effect an acceptance, was not denied ; but it 
 was insisted, on the part of the respondent, that it was made after the 
 offer was withdrawn. It will be necessary to consider when this ac- 
 ceptance took place, as preparatory to settling the fact of the continu- 
 ance of the offer down to that time. There is not the slightest evi- 
 dence of the determination on the part of Mactier to take the brandy 
 before March 17.i The insurance that he effected on his commissions 
 March 1 disproves the existence of such a determination on that day ; 
 but if the situation of the parties was changed, and Frith was now en- 
 deavoring to set up the contract, I am at a loss to conceive how Mac- 
 tier's representatives could withstand the force of the facts which took 
 place March 17. In answer to the offer, Mactier delayed coming to a 
 determination thereon, but promised to accept it if there should be a 
 war ; March 17, when that event was considered as settled, he entered 
 the brandy as his own property, and told his clerk that he had deter- 
 mined to take it. But if there should be any doubt as to the effect of 
 this conduct, there can be none as to his subsequent acts. By a letter 
 dated the 25th with a postscript of March 31, he accepted the offer. 
 This letter was immediately transmitted to Frith, and as soon as March 
 
154 OFFER AND ACCEPTANCE (Ch. 1 
 
 28, entries were made in his books showing that he had become the 
 purchaser. Enough was clone by the 31st to constitute an acceptance 
 of Frith's offer and to complete the bargain, if the offer can be con- 
 sidered as standing till that day. 
 
 An offer, when once made, continues, as I have heretofore shown, 
 to the satisfaction of my own miiid at least, until it is expressly revok- 
 ed, or until circumstances authorize a presumption that it^is revoked. 
 The offer itself may show very clearly when the presumption of revo- 
 cation attaches. Where it is made to be replied to by return mail, the 
 party to whom it is addressed must at once perceive that it is not to 
 stand for an acceptance, to be transmitted after that mail. If an offer 
 stands until it is expressly withdrawn, or is presumed to be withdrawn, 
 whether it is held out to a party at a particular period or not, is a 
 matter of fact. Then we are to determine, as a matter of fact, wheth- 
 er Frith's offer was held out for IVJ^actier's acceptance until March 31; 
 if Frith intended it should stand on, and he viewed himself as tender- 
 ing it to Mactier down to that time, we are bound to regard it as stand- 
 ing, unless his intention was the result of the fraudulent conduct of 
 Mactier. The acts of Frith, after the death of Mactier, could do noth- 
 ing towai^s completing an unfinished contract; but I think they may 
 be fairly adverted to for the purpose of ascertaining his intentions ih 
 relation to the continuance of his offer. March 7, he acknowledges 
 Mactier's letter of Jan. 17, which did not decline, as it has been con- 
 strued to do, the offer, but apprised him that it was kept under advise- 
 ment ; and by using the expression, "noting the contents," Frith is, I 
 think, to be understood as yielding to the proposed delay. If a doubt 
 as to this construction of that letter could spring up in the mind, it 
 would be at once removed by the perusal of the letter of the 28th of 
 the same month. In that he expresses a wish to confirm what he had 
 said in the letter making the offer to sell, and declares that he had in a 
 previous letter, which must mean that of the 7th, omitted to commu- 
 nicate the same thing. In answering Mactier's letter which contained 
 the acceptance of his offer, he recognizes the bargain as closed, and 
 gives directions as to investing the proceeds of the brandy. All the 
 stibsequent correspondence acquiesces in the sale. It, appears to me to 
 be impossible to say, after reading the letters of Frith written subse- 
 quent to his knowledge of Mactier's acceptance, that he did not consid- 
 er the offer as held out to Mactier down to the time when it was ac- 
 cepted, and the bargain closed by that acceptance ; and I think we must 
 adjudge it to have been closed, unless the agreement was nugatory by 
 reason that the thing to which it related had not an actual or potential 
 existence when the contract was consummated. * * * 
 
 Reversed. 
 
Sec. 9) LAPSE OP OFFER — POWER OF REVOCATION 155 
 
 TINN V. HOFFMANN & GO. 
 (In the Exchequer Chamber, 1873. 29 Law T. K. [N. S.] 271.) 
 
 This was an action brought by the plaintiff against the defendants 
 to recover damages in respect of a breach of contract to 'deliver 800 
 tons of iron ; and by the consent of the parties, and by order of Mar- 
 tin, B., dated May 30th, 1872, the facts were stated for the opinion 
 of the Court of Exchequer in the following special case : 
 
 1. The plaintiff, Mr. Joseph Tinn, is an iron manufacturer, carry- 
 ing on business at the Ashton Row Rolling Mills, near Bristol; and 
 the defendant, who trades under the name and style of Hoffmann & 
 Co., is an iron merchant, carrying on business at Middlesbro'-on- 
 Tees. 
 
 2. In the months of November and December, 1871, the following 
 correspondence passed between the plaintiff and the defendant relat- 
 ing to the proposed purchase and sale of certain iron, the particulars ' 
 of which fully appear in the letters hereinafter set forth : 
 
 The plaintiff to the defendant: 
 
 "November 22, 1871. 
 "Messrs. Hoffmann & Co. : 
 
 "Dear Sirs: Please quote your lowest price for 800 tons No. 4 
 Cleveland, or other equally good brand, delivered at Portishead at 
 the rate of 200 tons per month, March, April, May, and June, 1872. 
 Payment by four months' acceptance. 
 
 "Yours truly, J. Tinn." 
 
 3. The defendants' reply : 
 
 "Royal Exchange Buildings, Middlesbro'-on-Tees, 
 
 "November 24, 1871. 
 "Joseph Tinn, Esq,, Bristol: 
 
 "Dear Sir: We are obliged by your inquiry of the 22d inst., and 
 by the present beg to offer you 800 tons No. 4 forge Middlesbro' pig 
 iron (brand at our option, Cleveland if possible), at 69s. per ton de- 
 livered at Portishead, delivery 200 tons per month, March, April, 
 May, and June, 1872, payment by your four months' acceptance from 
 date of arrival. 
 
 "We shall be very glad if this low offer would induce you to favor 
 us with your order, and waiting your reply by return, we remain, 
 dear sir, yours truly, A. Hoffmann & Co." 
 
 4. The plaintiff to the defendant : 
 
 "Bristol, November 27, 1871. 
 "Messrs. Hoffmann & Co. : 
 
 "Dear Sirs: The price you ask is high. If I made the quantity 1200 
 tons, delivery 200 tons per month for the first six months of next year 
 I suppose you would make the price lower ? Your reply per return 
 will oblige J. Tinn." 
 
156 OFFER AND ACCBPTANCB (Ch. 1 
 
 5. The defendant to the plaintiff in reply : 
 
 "Royal Exchange Buildings, Middlesbro'-on-Tees, 
 
 "Novembef 28, 1871. " 
 "Joseph Tinn, Esq., Bristol : 
 
 "Dear Sir: In reply to yotir favor of yesterday, we beg to state 
 that we are willing to mal<e you an offer of further 400 tons No. 4 
 .forge Middlesbro' pig iron, 2(X) tons in January, 200 tons .in February, 
 at the same price we quoted you by ours of the 24th inst., though the 
 rate of freight at the above-named time-will doubtless be considerably 
 higher than that of the following months. 
 
 "Our to-day's market was very firm again, and we feel assured we 
 shall see a further rise ere long. 
 
 "Kindly let us have your reply by return of post as to whether you 
 accept our offers of together 1200 tons and oblige yours truly, 
 
 "A. Hoffmann & Co." 
 
 6. The plaintiff to the defendant : 
 
 "Bristol, November 28, 1871. 
 "Messrs. Hoffmann & Co. : 
 
 "No. 4 Pig iron. 
 "Dear Sirs : You can enter me 800 tons on the terms and conditions 
 named in your favor of the 24th inst., but I trust you will enter the 
 other 400, making in all 1200 tons, referred to in ray last, at 68s. per 
 ton. Yours faithfully, Joseph Tinn." 
 
 7. The defendants' reply : 
 
 "Royal Exchange Buildings, Middlesbro'-on-Tees, 
 
 "November 29, 1871. 
 "Joseph Tinn, Esq. : • 
 
 "Dear Sir: We are obliged by your favor of yesterday, in reply to 
 which we are sorry to state that we are not able to book your esteemed 
 order for 1200 tons No. 4 forge at a lower price than that offered to 
 you by us of yesterday — viz., 69s., and even that offer we can only 
 leave you on hand for reply by to-morrow before twelve o'clock. 
 Waiting your reply, we remain, dear sir, yours truly, 
 
 "A. Hoffmann & Co." 
 
 8. On December 1st, 1871, the plaintiff sent a telegram to the de- 
 fendant, of which the following is a copy : 
 
 "From Tinn,' Ashton. 
 "To Hoffmann & Co., Middlesbro'-on-Tees. 
 
 "Book other 400 tons pig iron for me, same terms and conditions 
 as before." 
 
 And on the same day the plaintiff sent a letter to the defendant, of 
 which the following is a copy: 
 
Sec. ?) LAPSE OP OFFEE — POWER OP REVOCATION IST 
 
 "December 1, 1871. 
 "Messrs. Hoffmann & Co. : 
 
 "Dear Sirs: I have your favor of the 29th ult. Please enter the 
 remaining 400 tons No. 4 Forge Pig at 69s. ex-ship Portishead, de- 
 livery to commence January, 1872, payment by four months' ac- 
 ceptance against delivery. Kindly send me sold note for the 800 and 
 400 tons, and oblige, yours truly, J. Tinn." 
 
 9. The following correspondence then took place between the plain- 
 tiff and the defendants' clerk, duly authorized in that behalf. 
 
 The defendants' clerk to the plaintiff: 
 
 "Royal Exchange Buildings, Middlesbro'-on-Tees, 
 
 "December 1, 1871. 
 "Joseph Tinn, Esq., Bristol : 
 
 '.'Dear Sir: We have your telegram of this day, 'Book other 400 
 tons Pig iron, same terms and conditions as before,' which we note 
 arid shall lay before -our Mr. Hoffmann on his return next week. 
 Yours truly, for A. Hoffmann & Co. C. Jerveland." 
 
 10. Memorandum. 
 
 "December 2, 1871. 
 
 "From A. Hoffmann & Co., Middlesbro'-on-Tees. 
 "To Joseph Tinn, Esq., Bristol: 
 
 "The contents of your yesterday's favor is noted, and we shall lay 
 same before our principal on his return next week." 
 
 11. The defendants to the plaintiff: 
 
 "The Queen's Hotel, Manchester, December 4, 1871. 
 "Josepl|iTinn, Esq., Bristol : 
 
 "Dear Sir : I am in receipt of telegram 'Book other 400 tons, same 
 terms and conditions as before,' and favor of 1st inst. addressed to my 
 firm, in reply to which I very much regret to state that I am not able 
 to book the 1200 tons in question, as your reply to ours of November 
 28th and 29th did not reach us within the stipulated time; and as I 
 had other offers for the same lot, I disposed of the latter previous to 
 my leaving Middlesbro' and receiving your decision. 
 
 "Trusting to be more fortunate in future, I remain, dear sir, yours 
 truly, A. Hoffmann & Co." 
 
 12. The plaintiff to the defendant: 
 
 , "December 5, 1871. 
 "Messrs. Hoffmann & Co. : 
 
 "Dear Sirs : I regret you cannot enter me the 400 tons No. 4 Forge 
 Pig on the same terms as the 800 tons. Please send me sold note 
 for 800 tons per return. Yours truly, J. Tinn." 
 
158 OFFER AND ACCEPTANCE (Ch. 1 
 
 13. The reply of the defendants: 
 
 "Royal Exchange Buildings, Middlesbro'-dn-Tees, 
 
 "December 6, 1871. 
 "Joseph Tinn, Esq., Bristol : 
 
 "Dear Sir : Your favor of yesterday to hand, in reply to which we 
 have to state that we cannot send you contract for pig iron, having 
 sold you none. 
 
 "The quotation for 1200 tons in our respect of 29th ult. was for 
 your acceptance by 12 o'clock the 30th; and failing to receive such 
 we disposed of the iron, being under other offers, as already intimated 
 to you by our Mr. Hoffmann, and it is now utterly impossible for us 
 to book you the quantity you require, or you may rest assured that 
 we willingly would do so. We are, dear sir, yours truly, 
 
 "Pro A. Hoffmann & Co. C. Jerveland." 
 
 14. It is agreed that all the facts and circumstances mentioned 
 in the iabove correspondence are true, and that the court are to have 
 power to draw all inferences of facts in the same way as a jury might 
 do. 
 
 15. The course of post between Bristol and Middlesbrough is one 
 day. 
 
 16. The plaintiff contends that he has a binding contract with the 
 defendant whereby the defendants are bound to deliver to him 800 
 tons of iron. The defendants, on the other hand, contend that there 
 is no such contract, and refuse to deliver any of the said iron. 
 
 The questions for the opinion of the Court are, first, whether, upon 
 the facts stated aijd documents set out in the case, there is any bind- 
 ing contract on the part of the defendants to deliver 800 tons of iron 
 to the plaintiff; secondly, whether, upon the facts and documents set 
 out in the case, there is any binding contract on the part of th^def end- 
 ants to deliver any quantity of iron to the plaintiff, and if yea, what 
 quantity and on what terms and conditions. 
 
 [The Court of Exchequer (BramwEi.Iv, Channell, and PiGOTT, 
 BB.) gave judgment for the defendant; the Lord Chief Baron (Kelly) 
 dissenting in the belief that there was a contract for 800 tons. The 
 plaintiff brought error to this Court.] 
 
 HoNYMAN, J. I am of opinion that the judgment of the Court below 
 was wrong, and that judgment ought to be entered for the plain- 
 tiff in respect of 800 tons. The question depends entirely on the 
 construction and effect of the defendants' letter of the 24th and the 
 two letters of November 28th, 1871, one written by the plaintiff and 
 the other by the defendants. The plaintiff had been inquiring at 
 what price the defendants would let him have 800 tons of iron, and 
 by their letter of November 24th they named 69s. per ton as the price 
 for the 800 tons, to be delivered at the rate of 200 tons per month, in 
 the four months of March, April, May, and June, 1872 ; and that 
 letter concluded thus, "waiting your reply by return." Mr. King- 
 
Sec. 9) LAPSE OP OFFER — POWER OF REVOCATION 159 
 
 don, on the part of the plaintiff, admitted, and I think very properly, 
 that the meaning of that was, we offer you that price, provided you 
 accept it by return. Inasmuch as it was not accepted by return, as 
 it stood, I presume had it stopped there, there would have been no 
 contract. The plaintiff not only did not accept by return, but, on 
 the contrary, he objected to the price, for on November 27th he wrote 
 saying that the price was too high, and asking whether if he increased 
 the quantity to 1200 tons, to be deliverable 200 tons per month — 
 that is to say, in addition to the quantity he had already proposed 
 for, to be delivered in March, April, May, and June, 1872, 400 tons 
 more, to be delivered 20O tons in January and 200 in February, 1872, 
 that would make the price lower. Upon that, on November 28th, 
 the defendants wrote- the following letter, on the construction of 
 which I believe the difference of opinion among the members of the 
 Court mainly arises- [Reads letter of that date.] What is the mean- 
 ing of that letter? It amounts to this: On November 24 we offered 
 you 800 tons for delivery at 69s. ; we now repeat to you that offer, 
 and in addition to that, we make a further offer of 400 tons more — 
 that is, we renew the offer of November 24th, and we make you a 
 further offer of 400 tons, provided you accept those offers "by return 
 of post." That does not mean exclusively a reply by letter by return 
 of post, but you may reply by telegram or by verbal message, or 
 by any means not later than a letter written and sent by return of 
 post would reach us. If that is so, then comes the plaintiff's letter, 
 written on the same day, November 28th, which crosses the defend- 
 ants' letter of the same date, in which the plaintiff said, "You can 
 enter me 800 tons on the terms and conditions named in your favor 
 of .the 24th inst., but I trust you will enter the other 400, making in 
 all 1200 tons, referred to in my last, at 68s. per ton, ex ship Portis- 
 head." 
 
 I cannot agree in the opinion said to have been expressed by my 
 Brothers Pigott and Channell in the Court below. As I understand, 
 my Brother Pigott certainly says this is not a clean offer, or a clean 
 acceptance of 800 tons, but that it is 800 tons on the condition or 
 hope or trust that they would lower the price of the other 400 tons. 
 I cannot accede to that view of the case. I assume that it plainly 
 amounts to this, "I will take your 800 tons on the terms and condi- 
 tions mentioned in the letter of the 24th inst., but I hope you will let 
 me have the other lot at 68s. per ton; if you choose to do that, well 
 and good." I cannot understand how it can be said that that is not 
 an absolute acceptance of the 800 tons, supposing it was competent 
 to the plaintiff to accept that quantity. In the Court below it seems 
 to have been treated as' if the offer of November 28th was one offer of 
 1200 tons. I do not think so. I think it is a repetition of the offer of 
 800 tons coupled with a further offer of 400 tons, and that it was com- 
 petent to the plaintiff to accept one and not accept the other. My 
 Brother Bramwell appears to have thought that it was not material 
 
160 OFFEE AND ACCEPTANCE. (Ch. 1 
 
 to consider whether it was two separate offers of 400 tons and 800 
 tons, or an offer of 1200 tons, because in either view of the case, the 
 plaintiff could not accept the one and reject the other. If it is to be 
 construed as strictly one offer of 1200 tons, I can understand it, and 
 then of course he could not accept the one and reject the other. But 
 I do not think it is one offer of 1200 tons, nor two offers one of 
 400, and the other of 800 tons, but that it is a repetition of the offer 
 of 800 tons, with a further offer of further 400 tons. To say that he 
 could not accept the 400 tons without the 800 tons seems, in my view 
 of the matter, to throw no light on the question whether he might 
 accept the 800 tons without the 400 tons. That being so, it being in 
 ray judgment a separate offer of 800 tons, and 400 tons in addition, 
 I should have thought, had the plaintiff's letter of the 28th been 
 written on November 29th, that nobody, but for the opinions which 
 have been expressed here to-day, could have entertained a doubt that it 
 would have been an acceptance. What, then, is the effect when the 
 two letters are written on the same day and crossed each other in the 
 post ? Does that make any difference ? 
 
 On this part of the case, as far as I can gather from the notes 
 that have been given us of the judgments below, my Brother Bram- 
 well is of the same opinion as I am, because I understand him to say 
 that, if he had thought that these were two offers, and that the two 
 offers were capable of being accepted the one without the other, then 
 the fact of the acceptance crossing the offer would have been no bar 
 to the contract. After the plaintiff had written the letter of Novem- 
 ber 28th mentioning the 800 tons, it could not be said that he would 
 not have been bound by the defendants' letter of the same date, if 
 it had been written on November 29th. I do not see how it can be 
 contended that there would not then have been a valid contract lor 
 800 tons, except with regard to the question of whether it were one 
 offer, or two offers. Of course, if it is one offer, that is one thing; 
 but if it be two offers, then, if the defendants' letter of November 
 28th had been written on the 29th, after he had received the plain- 
 tiff's letter of the 28th, it could not be said that that did not make a 
 good contract for 800 tons. I cannot see why the fact of the let- 
 ters crossing each other should prevent their making a good con- 
 tract. If I say I am willing to buy a man's house on certain terms, 
 and he at the same moment says that he is willing to sell it, and 
 these two letters are posted so that they are irrevocable with re- 
 spect to the writers, why should not that constitute a good contract? 
 'The parties are ad idem at one and the same moment. On these 
 grounds it appears to me that the judgment of the Court below 
 was wrong, and ought to be reversed. I speak with some hesitation 
 in this case when I find that the opinion of the majority of my Broth- 
 ers is against me, and also when the question turns entirely on the 
 construction of a somewhat ambiguously written letter. 
 
 BeutT, J. The question is, whether upon a true construction of this 
 
Sec. 9) LAPSE OF OFFER — POWER OF REVOCATION lf>l 
 
 correspondence, there is a binding contract between the plaintifif and 
 the defendants for the 800 tons of iron at 69s. It is argued on the 
 one side that such a contract is disclosed because it is said that the 
 defendants' letter of November 24th is an offer for the sale of 800 
 tons of iron, and this letter of November 28th leaves open the time 
 for accepting that offer of November 24th, and makes a new offer 
 with regard to another 400 tons; and that the defendants' offer of 
 November 24th being thus opened by their letter of the 28th, the 
 plaintiff's letter of the 28th is an acceptance of the defendants' offer 
 of the 24tli. On the other side it is argued that the defendants' letter 
 of November 28th is not an opening of their offer of the 24th, but 
 that it is an offer with regard to 1200 tons; and that even if it were 
 a separate offer with regard to 800 tons and 400 tons, still that the 
 true view of the matter is not that it reopens the letter of the 24th, 
 but that it makes a new offer with regard to the 800 tons, and another 
 separate offer, with regard to 400 tons; and that, upon such a view, 
 the renewed offer with regard to 800 tons is not accepted, because the 
 letter of the plaintiff of November 28th was not in answer to that 
 offer, but was a letter crossing it. Now with regard to the construc- 
 tion of the defendants' letter of November 28th, it seems to me 
 that we must consider that the defendant's letter of' November 24th 
 is in answer to a request of the plaintiffs of November 22d for an 
 offer with regard to 800 tons, and is therefore an offer by them with 
 regard to 800 tons. That offer left it open to the plaintiff to accept 
 it within a period which is to be computed by the return of post. 
 I agree that the words, "Your reply by return of post" fixes the time 
 for acceptance, and not the manner of accepting. But that time 
 elapsed; there was no acceptance within the limited time. So far 
 from there being an acceptance, it seems to me that the plaintiff's 
 letter of November 27th rejects that offer; it rejects it on the ground 
 the the price is higher than the plaintiff is willing to give. That offer 
 is, therefore, not accepted within the limited time, but is rejected, 
 and it seems to me is at once dgad. The letter of the 27th then asks 
 for an offer with respect to 1200 tons, and the letter of November 
 28th is a letter written "In reply to your favor of yesterday," that 
 is. In reply to your request for an offer with regard to 1200 tons. 
 "I now make you this offer." That seems to me to show that the let- 
 ter of November 28th of the defendants is an offer with regard to 
 1200 tons, and not with regard to 800 tons and 400 tons separately. 
 The way in which the offer with regard to the 1200 tons is made 
 is this: "With regard to the' first 800 of them, I make you a new 
 offer upon the same terms as I made in the former offer on the 
 24th. With regard to the remaining 400 tons, I offer you to de- 
 liver them at the saine price, but at different periods of delivery." 
 
 I think that the defendants' letter of November 28th, being a letter 
 in answer to a request with regard to 1200 tons, is an offer with 
 
 COBBIN OONT 11 ' 
 
102 OFFER AND ACCEPTANCE (Cll. I 
 
 regard to 1200 tons, and that no such offer was ever accepted; but 
 even if it could be taken that it was a separate offer with regard to 
 800 tons and 400 tons, I cannot accede to the view that it reopened 
 the offer of November 24th. That offer, was dead, and was no longer 
 binding upon the defendants at all, and therefore it seems to me to 
 be a wrong phrase to say that it reopened the offer of November 
 24th. The only legal way of construing it is to say that it is a new 
 offer with regard to 800 tons. If it were a separate offer, which I 
 should think it was not, it then would- be a new offer with regard 
 to 800 tons, and a separate offer with regard to 400 tons, but, even 
 if it were so, I should think that the new offer with regard to the 
 800 tons had never been accepted, so as to make a binding contract. 
 The new offer would not, in my opinion, be accepted, ,by the fact 
 of the plaintiff's letter of November 28th crossing it. If the de- 
 fendants' letter of November 28th is a new offer of the 800 tons, that 
 could not be accepted by the plaintiff until it came to his knowledge, 
 and his letter of November 28th could only be considered as a cross 
 offer. Put it thus : If I write to a person and say, "If you can give 
 me i6000 for my house, I will sell it to you," and on the same day, 
 and before that letter reaches him, he writes to me, saying, "If you 
 will sell me your house for £6000 I will buy it," that would be two 
 offers crossing each other, and cross offers are not an acceptance 
 of each other, therefore there will be no offer of either party accept- 
 ed by the other. That is the case where the contract is to be made 
 by the letters, and by the letters only. I think it would be different 
 if there were already a contract in fact made in words, and then the 
 parties were to write letters to each other, which crossed in the post, 
 those might make a very good memorandum of the contract alrea*ly 
 made, imless the Statute of Frauds intervened. But where the con- 
 tract is to be made by the letters themselves, you cannot make it 
 by cross offers, and say that the contract was made by one par- 
 ty accepting the offer which was made to him. It seems to me, 
 therefore, in both views, that the judgment of the Court below was 
 right. 
 
 Judgment of the Court below affirmed.^"" 
 
 85 The dissenting opinion of Quain, J., and the opinions of Archibald, Black- 
 bum, Grove, and Keating, JJ., concurring with Brett, J., have been omitted. 
 In the course of his opinion, Blackburn, J., said: "When a contract is made 
 between two parties, there is a promise by one, In consideration of the prom- 
 ise made by the other; there are two assenting minds, the parties agreeing 
 in opinion, and one having promised in consideration of the promise of the 
 other — there is an exchange of promises ; but I do not think exchanging offers 
 would, upon principle, be at all the same thing. There is, I believe, a total 
 absence of authority on the point. I do not think, though I am not sure, that 
 the question has ever been raised before. The promise or offer being made 
 on each side in ignorance of the promise or the offer made on the other side, 
 neither of them can be construed as an acceptance of the other. Either of 
 the parties may write and say, "I accept, your offer, and, as you perceive, I 
 have already made a similar offer to you," and then people would know what 
 they were about ; I think either side might revoke." 
 
Sec. 9) LAPSE OF OFFER — POWER OP REVOCATION 163 
 
 HURFORD V. PILE. 
 (In the King's Bench, 1615. Cro. Jac. 483.) 
 
 Assumpsit. Whereas J. S. being in execution for forty pounds, the 
 defendant said, "Deliver J. S. out of execution, and what it cost you 
 I will repay ;" wherefore J. S. was discharged by the plaintiff. The de- 
 fendant for plea saith, that after the assumpsit, and before the plaintilf 
 had done any thing in that business, he forbade him to meddle therein, 
 and that he would not stand to his promise. The plaintiff demurred ; 
 and it was adjudged for the plaintiff. 
 
 Houghton, Justice, said, that a man iiiay discharge an assumpsit 
 made to himself, byt he cannot discharge an assumpsit made by him- 
 self : but, at another day, the defendant's counsel moved, that it was 
 a good plea, and that as long as nothing was done, it was but an exec- 
 utory promise. 
 
 DoDERiDGE. If I promise to J. S. that if he build an house upon 
 my land before Michaelmas, I will pay him a hundred pou'nds, and I 
 countermand it before he hath done any thing concerning the house, it 
 is a good countermand. 
 
 Houghton e contra ; but he said, that may be considered in damages. 
 Et adjournatur. i 
 
 Afterwards, in Trinity term, judgment was given for the plaintiff. 
 
 PAYNE V. CAVE. 
 (In the King's Bench, 1789. 3 Term R. 148.) 
 
 This was an action, tried at the sittings after last term at Guildhall 
 before Lord Kenyon, wherein the declaration stated that the plaintiff 
 on 22d September,' 1788, was possessed of a certain worm-tub, and a 
 pewter worm in the same, which were then and there about to be sold 
 by public auction by one S. M., the agent of the plaintiff in that behalf, 
 the conditions of which sale were to be the usual conditions of sale of 
 goods sold by auction, &c. of all which premises the defendant after- 
 wards, to wit, &c. had notice; and thereupon the defendant in con- 
 sideration that the plaintiff, at the special instance and request of the 
 defendant, did then and there undertake, and promise to perform the 
 conditions of the said sale, to be performed by the plaintiff, as seller, 
 &c. undertook, and then and there promised the plaintiff to perform 
 the conditions of the sale, to be performed on the part of the buyer, 
 &c. And the plaintiff avers, that the conditions of sale, herein after 
 me«tioned, are usual conditions of sale of goods sold by auction, to 
 wit, that the highest bidder should be the purchaser, and should depos- 
 it five shillings in the pound, and that if the lot purchased were not paid 
 for and taken away in two days time, it should be put up again and 
 resold, &c. [stating all the conditions]. It then stated that the defend- 
 
164 OFFEE AND ACCEPTANCE (Ch. 1 
 
 ant became the purchaser of the lot in question for £40, and Wias re- 
 quested to pay, the usual deposit which he refused, &c. At the trial, 
 the plaintiff's counsel opened the case thus; — The goods were put up 
 in one lot at an auction ; there were several bidders, of whom the de- 
 fendant was the last, who bid £40; the auctioneer dwelt on the bid- 
 ding, on which the defendant said "why do you dwell, you will not get 
 more;" the auctioneer said that he was informed the worm weighed 
 at least 1,300 cwt., and was worth more than £40; the defendant 
 then asked him whether he would warrant it to weigh so niuch, and 
 receiving an answer in the negative, he then declared that he would not 
 take it, and refused to pay for it. It was re-sold on a subsequent day's 
 sale for £30 to the defendant, against whom the action was brought 
 for the difference. Lord Kenyon, being of opinion on this statement 
 of the case, that the defendant was at liberty to withdraw his bidding 
 any time before the hammer was knocked down, nonsuited the plain- 
 tiff. ■ 
 
 Walton now moved to set aside the nonsuit, on the ground that the 
 bidder was bound by the conditions of the sale to abide by his bidding, 
 and could not retract. By the act of bidding he acceded to those con- 
 ditions, one of which was, that the highest bidder should be the buyer. 
 The hammer is suspended, not for the benefit of the bidder, or to give 
 him an opportunity of repenting, but for the benefit of the seller : in 
 the mean time the person who bid last is a conditional .purchaser, if no- 
 body bids more. Otherwise it is in the power of any pej-son to injure 
 the vendor, because all the former biddings are discharged by the last : 
 and, as it happened in this very instance, the goods may thereby ulti- 
 mately be sold for less than the person who was last out-bid would 
 have given for them. The case of Simon v. Motives, 3 Burrows, 1921, 
 which was mentioned at the trial, does not apply. That turned on the 
 statute of frauds. 
 
 The Court thought the nonsuit very proper. The auctioneer is the 
 agent of the vendor, and the assent of both parties is necessary to 
 make the contract binding; that. is signified on the part of the seller, 
 by knocking down the hammer, which was not done here" till the de- 
 fendant had retracted. An auction is not unaptly called locus poeni- 
 tentise. Every bidding is nothing more than an offer on one side, 
 which is not binding on either side till it is assented to. But according 
 to what is now contended for, one party would be bound by the offer, 
 and the other not, which can never be allowed. 
 
 Rule refused.*" 
 
 88 In accord: Anderson v. "Wisconsin Cent. R. Co., 107 Minn. 296, 120 N. W. 
 39, 20 L. R. A. (N. S.) 1133, 131 Am. St. Rep. 462, 16 Ann. Cas. 879 (1909). In 
 Bskridge v. Glover, 5 Stew. & P. (Ala.) 264, 26 Am. Dee. 344 (1834), the de- 
 fendant agreed to trade horses with plaintifiE and pay $50 cash, if after plain- 
 tiff rode defendant's horse 10 miles he should be pleased with him. Then de- 
 fendant ran after plaintiff and withdrew. 
 
 Bids on public contracts are sometimes made irrevocable by statute. See 
 City of Baltimore v. J. L. Robinson Const. Co., 123 Md. 660, 91 Atl. 682, L. 
 
Sec. 9) LAPSE OF OFFER — POWER OF REVOCATION 165 
 
 COOKE V.' OXLEYf 
 (Ta the King's Bench, 1790. 3 Term R. 653.) 
 
 This was an action upon the case; and the third count in the dec- 
 laration, upon which the verdict was taken, stated that on, etc., a 
 certain discourse was had, etc., concerning the buying of 266 hogs- 
 heads of tobacco; and on that discourse the defendant proposed 
 to the plaintiff that the former should sell and deliver to the latter 
 the said 266 hogsheads [at a certain price] ; whereupon the plaintiff 
 desired the defendant to give him (the plaintiff), time to agree to or 
 dissent from the proposal till the hour of four in the afternoon of 
 that day, to which the defendant agreed; and thereupon the defend- 
 ant proposed to the plaintiff to sell and deliver the same upon the terriis 
 aforesai^, if the plaintiff would agree to purchase them upon the 
 terms aforesaid, and would give, notice thereof to the defendant before 
 the hour of four in the afternoon of that day; the plaintiff averred 
 that he did agree to purchase the same upon the terms aforesaid, and 
 did give notice thereof to the defendant before the hour of four in 
 the afternoon of that day; he also averred that he requested the de- 
 fendant to deliver to him the said hogsheads, and offered to pay to the 
 defendant the said price for the same, yet that the defendant did not, 
 etc. 
 
 A rule having been obtained to show cause why the judgment should 
 not be arrested, on the ground that there was no consideration for 
 the defendant's promise. 
 
 Erskine and Wood now showed cause. This was a bargain and 
 sale on condition; and though the plaintiff might hav^ rescinded the 
 contract before 4 o'clock, yet not having done so, the condition 
 was complied with, and both parties were bound by the agreement. 
 The declaration considered this as a complete bargain and sale; 
 for the breach of the agreement is for not delivering the tobacco, and 
 not for not selling it. 
 
 Lord Kenyon, C. J. (stopping Bearcroft, who was to have argued 
 in support of the rule). Nothing can be clearer than that at the time 
 of entering into this contract the engagement was all on one side ; 
 the other party was not bound; it was therefore nudum pactum. 
 
 BuLLER, J. It is impossible to support this declaration in any point 
 
 R. A. 1915A, 225, Ann. Oas. 1916C, 425 (1914). For similar provisions as tp all 
 ofCers, see Swiss Code of Oblig. § 3 ; German Civil Code, §§ 145, 658 ; Jap. 
 Civil Code, art. 521 ; Civil Code Ga. 1895, | 3645. 
 
 The vote of an official board to accept a bid Is not operative, unless offi- 
 cially communicated. Benton v. Springfield Young Men's Christian Ass'n, 170 
 Mass. 534, 49 N. E. 928, 64 Am. St. Rep. 320 (189S) ; Edge Moor Bridge Works 
 V. County of Bristol, 170 Mass. 528, 49 N. E. 918 (189S) ; Peek v. Detroit Nov- 
 elty Works, 29 Mich. 313 (1874) ; Powell v. Lee, 99 L. T. 284 (1908) ; In re 
 London & Northern Bank, [1900] 1 Ch. 220. 
 
 An. alteration in the terms of an offer by the offeror operates as a revoca- 
 tion. Travis v. Nederland Life Ins. Co., 104 Fed. 486, 43 C. C. A. 653 (1900). 
 
166 OFFEE AND ACCEPTANCE! (Ch. 1 
 
 of view. In order to sustain a promise, there must be either a dam- 
 age to the plaintiff, or an advantage to the defendant ; but here was 
 neitlier when the contract was first made. Then as to the subsequent 
 time, the promise can only be supported on the ground of a new 
 contract made at 4 o'clock; but there is no pretence for that. It has 
 been argued that this must be taken to be a complete sale from the 
 time when the condition was complied with; but it was not com- 
 plied 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. 
 
 GrosB, J. The agreement was not binding on the plaintiff before 4 
 o'clock ; arid it is not stated that the parties came to any subse- 
 quent agreement; there is therefore no consideration for the prom- 
 ise. 
 
 Rule absolute. , 
 
 BOSTON & MAINE R. R. v. BARTLETT et al. 
 (Supreme Judicial Court of Massachusetts, 1849. 3 Oush. 224.) 
 
 This was a bill in equity for the specific performance of a con- 
 tract in writing. - 
 
 The plaintiffs alleged that the defendants on April 1, 1844, being the 
 owners of certain land situated in Boston, and particularly described in 
 the bill, "in consideration that said corporation would take into con- 
 sideration the expediency of buying said land for their use as a corpo- 
 ration, signed a certain writing dated April 1, 1844," whereby they 
 agreed to convey to tlie plaintiffs- "the said lot of land, for the sum 
 of $20,000, if the said corporation would take the same within thirty 
 days from that date;" that afterward and within the thirty days, the 
 defendants, at the request of the plaintiffs, "and in consideration 
 that the said corporation agreed to keep in consideration the expedi- 
 ency of taking said land," etc., extended the said term of thirty 
 days, by a writing underneath the written contract above mentioned, 
 for thirty days from the expiration thereof; that, on May 29, 1844, 
 while the extended contract was in full force, and unrescinded, the 
 plaintiffs elected to take the land on the terms specified in the con- 
 tract, and notified the defendants of their election, and offered to 
 pay them the agreed price (producing the same in money) for a con- 
 veyance of the land, and requested the defendants to execute a con- 
 veyance thereof, which the plaintiffs tendered to them for that pur- 
 pose; and that the defendants refused to execute such conveyance, or 
 to perform the~ contract, and had ever since neglected and refused to 
 perform the same. 
 
 The defendants demurred generally. 
 
 Fi^ETCHER, J. In support of the demurrer, in this case, the only 
 ground assumed and insisted on by the defendants is, that the agree- 
 
Sec. 9) LAPSE OP OFFER — POWER OF REVOCATION 167 
 
 irfent on their part was without consideration, and therefore not 
 obligatory. In the view taken of the case by the Court, no importance 
 is attached to the consideration set out in the bill— namely, "that 
 the plaintiffs would take into consideration the expediency of buying 
 the land." The argument for the defendants, that their agreement 
 was not binding, ' because without consideration, erroneously as- 
 sumes that the writing executed by the defendants is to be consid- 
 ered as constituting a contract at the time it was made. The deci- 
 sion of the Court in Maine in the case of Bean v. Burbank, 16 Me. 
 458, 33 Am. Dec. 681, which was referred to for the defendants, seems 
 to rest on the ground assumed by them in this case. 
 
 In the present case, though the writing signed by the defendants 
 was but an offer, and an offer which might be revoked, yet while it 
 remained in force and unrevoked, it was a continuing offer during 
 the time limited for acceptance; and, during the whole of that time, 
 it was an offer every instant, but as soon as it was accepted, it ceased 
 to be an offer merely, and then ripened into a contract. The counsel 
 for the defendants is most surely in the right, in saying that the writ- 
 ing when made was without consideration, and did not tharrefore 
 form a contract. It was then but an offer to contract, and the parties 
 making the offer most undoubtedly might have withdrawn it at any 
 time before acceptance. 
 
 But when the offer was accepted, the minds of the parties met, and 
 the contract was complete. There was then the meeting of the minds 
 of the parties, which constitutes and is the definition of a contract. 
 The acceptance by the plaintiffs constituted a sufficient legal con- 
 sideration for the engagement on the part of the defendants. There 
 was then nothing wanting, in order to perfect a valid contract on 
 the part of the defendants. It was precisely as if the parties had 
 met at the time of the acceptance, and the offer had then been made 
 and accepted and the bargain completed at once. 
 
 A different doctrine, however, prevails in France and Scotland and 
 Holland. It is there held' that whenever an offer is made, granting 
 to a party a certain time within which he is to be entitled to decide, 
 whether he will accept it or not, the party making such oifer is not 
 at liberty to withdraw it before the lapse of the appointed time. 
 There are certainly very strong reasons in support of this doctrine. 
 Highly respectable authors regard it as inconsistent with the plain 
 principles of equity, that a person, who has been induced to rely on 
 such an engagement, should have no remedy in case of disappoint- 
 ment. But whether wisely and equitably or not, the common law un- 
 yieldingly insists upon a consideration, or a paper with a seal at- 
 tached. 
 
 The authorities, both English and American, in support of this view 
 of the subject, are very numerous and decisive ; but it is not deemed 
 to be needful or expedient to refer particularly to them, as they are 
 collected and commented on in several reports as well as in the text- 
 
168 OFFER AND ACCEPTANCE (Ch. 1 
 
 books. The case o£ Cooke v. Oxley, 3 T. R. 653, in which a different 
 doctrine was held, has occasioned considerable discussion, and in one or 
 two instances has probably influenced the. decision. That case 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 considered as of any authority. 
 
 As therefore in the present case the bill sets out a proposal in writ- 
 ing, and an acceptance_ and an offer to perform, on the part of: the 
 plaintiffs, within the time limited, and while the offer was in full force, 
 all of which is admitted by the demurrer, so that a valid contract in 
 writing is shown to exist, the- demurrer must be overruled.^' 
 
 BYRNE & CO. v. VAN TIENHOVEN & CO. 
 
 (In the High Court of Justice, Common Pleas Division, 1880. L. R. 5 C. P. 
 
 Div. 344.) 
 
 IviNDLBY, J.*' This was an action for the recovery pf damages for 
 the non-delivery by the defendants to the plaintiffs of 1000 boxes of 
 tinplates, pursuant to an alleged contract, which I will refer to pres- 
 ently. The action was tried at Cardiff before myself without a jury; 
 and it was agreed at the trial that in the event of the plaintiffs being 
 entitled to damages they should be £375. 
 
 The defendants carried on business at Cardiff and the, plaintiffs at 
 New York, and it takes ten or eleven days for a letter posted at either 
 place to reach the other. The alleged contract consists of a letter writ- 
 ten by the defendants to th^ plaintiffs on October 1st, 1879,, and re- 
 ceived by them on the 11th, and accepted by telegram a:nd letter sent 
 to the defendants on October 11th and 15th respectively. [The letter 
 of October 1st, 1879, from the defendants to the plaintiffs contained a 
 reference to the price of tinplates, and made an "offer of 1000 boxes of 
 this brand 14x20 at ISs. 6d. per box f. o. b. here with 1 per cent, for 
 pur commission; terms, four months' banker's acceptance on London 
 or Liverpool against shipping documen;ts, but subject to your cable on 
 or before the 15th inst. here." The plaintiffs accepted by cable sent on 
 October 11th, 1879, g,nd confirmed it by letter gent October 15th, 1879. 
 On October 8th the defendants mailed to the plaintiffs a letter with- 
 
 87 In Ellis* Adm'r V. r>urkee, 79 Vt. 341, 65 Atl. 94 (1906), the court said: 
 "The only importance of inquiring whether or not an offer is supported by a 
 consideration is to determine whether It can be withdrawji by the, party mak- 
 ing it before, it is accepted by the party to whom it is made. If It is based 
 upon a consideration, the power of revocation is not attached to it. But, 
 though it be without consideration, it may be accepted so as to make a binding 
 contract if hot sooner revoked, but it may be revoked at any time before it is 
 accepted-T^and this is so though it states a certain time during which it is to 
 remain pperi." 
 
 SB The statement of facts has been abbreviated, and part of the opinion ia 
 omitted. : ' • 
 
Sec. 9) LAPSE OF OFFER — POWER OF REVOCATION 169 
 
 drawing their offer of the 1st. This letter was received by the plain- 
 tiffs on October 20th. The plaintiffs refused to recognize the revoca- 
 tion, demanded performance by both cable and mail, and later brought 
 this action.] * * * 
 
 There is no doubt that an offer can be withdrawn before it is ac- 
 ceptedj and it is immaterial whether the offer is expressed to be open 
 for acceptance for a given time or not-^Routledge v. Grant [4 Bing. 
 653]. For the "decision of the present case, however, it is necessary to 
 consider two other questions — viz. : I. Whether a withdrawal of an 
 offer has any effect until it is communicated to the person to whom the 
 offer has been sent?. 2. Whether posting a letter of withdrawal is a 
 communication to the person to whom the letter is sent ? 
 
 It is curious that neither of these questions appears to have been ac- 
 tually decided in this country. As regards the first ques-tion, I am 
 aware that Pothier and some other writers of celebrity are of opinion 
 that there can be no contract if an offer is withdrawn before it is ac- 
 cepted, although the withdrawal is not communicated to the person to 
 whom the offer has been made. The reason for this opinion is that 
 there is not, in fact, any such consent by both parties as is essential to 
 constitute a contract between them. Against this view, however, it 
 has been urged that a state of mind not notified cannot be regarded in 
 dealings between man and man; and that an uncommunicated revo- 
 cation is for all practical purposes and in point of law no revocation 
 at all. This is the view taken in the United States. See' Tayloe 
 V. Merchants' Fire Insurance Co. [9 How. 390, 13 L. Ed. 187] cited in 
 Benjamin on Sales, pp. 56-58, and it is adopted, by Mr. Benjamin. 
 The same view is taken by Mr. Pollock in his excellent work on Prin- 
 ciples of Contract, 2d. ed., p. 10, and by Mr. Leake in his Digest of the 
 Law of Contracts, p. 43. This yiew, n^oreover, appears to me much 
 more. in accordance with the general principles of English law than 
 the view maintained by Pothier. I pass, therefore, to the next question 
 — viz., whether posting the letter, of revocation was a sufficient com- 
 munication of it to the plaintiff. The offer was posted on October 1st, 
 the withdrawal was posted on the 8th, and did not reach the plaintiff 
 until after he had posted his letter of the 11th, accepting the offer. It 
 may be taken as! now settled that where an offer is made and accepted 
 by, letters sent through the postj.the contract is completed the moment 
 the letter accepting the offer is posted (Harris's Case, L. R. 7 Ch. 587 ;, 
 Dunjop V. Higgins, 1 H. L. C. 381) even although it never reaches its 
 destination. When, however, these authorities are looked at, it will be 
 seen that they are based upon the principle that the; writer of the offer 
 has expressly or impliedly assented to treat an answer to him by a 
 letter duly posted as a. sufficient acceptance and notification to himself, 
 or, in other words, he has made the post-office his agent to receive the 
 acceptance and notification of it. ' 
 
 But this principle appears to' me to be inapplicable to the case of the 
 withdrawal of an offer. , In, this particular case I can find no evidence 
 
170 OFFER AND ACCEPTANCE (Ch. 1 
 
 of any authority in fact given by the plaintiffs to the defendants to no- 
 tify a withdrawal of their offer by merely posting a letter; and there 
 is no legal principle or decision which compels me to hold, contrary to 
 the fact, that the letter of October 8th is to be treated as comnfunicated 
 to the plaintiff on that day or on any day before the 20th, when the 
 letter reached them. But before that letter had reached the plaintiffs 
 they had accepted the offer, both by telegram and by post; and they 
 had themselves resold the tinplates at a profit. In my opinion the 
 withdrawal by the defendants on October 8th of their offer of the 
 1st was inoperative; and a complete contract binding on both parties 
 was entered into on October 11th, when the plaintiffs accepted the of- 
 fer of the 1st, which they had no reason to suppose had been with- 
 drawn. Before leaving this part of the case it may be as well to point 
 out the extreme injustice and inconvenience which any other conclu- 
 sion would produce. If the defendants' contention were to prevail, no 
 person who had received an offer by post and had accepted it would 
 know his position until he had waited such a time as to be quite sure 
 that a letter withdrawing the offer had not been posted before his ac- 
 ceptance of it. It appears to me that both legal principles and prac- 
 tical 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. * * * 
 Judgment for plaintiffs.*' 
 
 THOMSON et al. v. JAMES. 
 (In the Court of Session of Scotland, 1855. 18 Sc. Sess. Cas. [Dunlop] 1.) 
 The Lord President '" [in the course of his opinion, said :] I 
 hold that a simple unconditional offer may be recalled at any time be- 
 fore acceptance, and that it may be so recalled by a letter transmit- 
 ted by post; but I hold that the mere posting of a letter of recall 
 does not make that letter effectual as a recall, so as from the moment 
 of posting to prevent the completion of the contract by acceptance. 
 An offer is nothing until it is communicated to the party to whom it 
 is made, and who is to decide whether he will or will not accept the 
 offer. In like manner I think the recall or withdrawal of an offer that 
 has been communicated can have no effect until the recall or withdrawal 
 has been communicated, or may be assumed to have been commu- 
 
 89 In accord: Patrick v. Bowman, 149 U. S.' 411, 13 Sup. Ct. 811, 866, 37 
 L. Ed. 790 (1893). 
 
 In some of the attempts at codifying the law of contracts there is a pro- 
 vision that a revocation of an offer is operative just as soon as it is put in 
 the course of transmission through the post. See Watters v. Lincoln, 29 S. D. 
 98, 135 N. W. 712 (1912) ; also a criticism of the California Code provision, by 
 Lewlnsohn, "Mutual Assent in California" (1914) 2 Cal. L. Eev. 341. 
 
 90 The statement and parts of the opinions of the Lord President and of 
 Lord Ourriehill and aU of the opinions of Lords t>eas and Ivory are omitted. 
 
Sec. 9) LAPSE OF OFFEE — POWER OF REVOCATION 171 
 
 nicated, to the party holding the offer. An offer, pure and uncondition- 
 al, puts it in the power of the party to whom it is addressed to accept 
 the offer, until by the lapse of a reasonable time he has lost the right 
 [power], or until the party who has made the offer gives notice, — 
 that is, makes known that he withdraws it. The purpose of the re- 
 call is to prevent the party to whom the offer was made from acting 
 upon the offer by accepting it. This necessarily implies precommu- 
 nication to the party who is to be so prevented. 
 
 The argument for the defender upon this branch of the case was 
 rested upon what I cannot help regarding as a strained applica- 
 tion of a rule or maxim, sufficiently sound in general application, but 
 which cannot be applied in the most strictly literal sense that the 
 words admit of. It was contended, that as the offerer had changed 
 his mind, and had posted a letter announcing that change before the 
 offeree had declared his mind by posting his acceptance, the intention 
 or consent to purchase cannot be held to have continued until the con- 
 sent to; sell was declared, and consequently that at no one moment of 
 time was there in idem placitum consensus atque conventio, which is 
 said to be essential to a paction. It was argued, Upon a rigid applica- 
 tion of that definition, that the completion of the contract was inter- 
 rupted by change of mind, though not yet communicated, just as it 
 would have been by the death or insanity of the offerer, and that 
 all these three events are classed together by some writers as being 
 alike revocations of the offer. Death or insanity may prevent the com- 
 pletion of the contract as effectually as the most complete revocation, 
 but they are not properly revocations of the offer. They are not acts of 
 the will of the offerer, and their effect does not rest upon a supposed 
 change of purpose. They interrupt the completion of the contract, — 
 that is, the making of the contract, — ^because a contract cannot be 
 made directly with a dead man or a lunatic. The contract is not made 
 until the offer is accepted; and if the person with whom you merely 
 intend to contract dies or becomes insane before you have contracted 
 with him, you can no longer contract directly with him.*^ You can- 
 not, by adhibiting your acceptance to an offer, and addressing it to a 
 dead man or a lunatic, make it binding on him, whether his death or 
 insanity be or be not known to you. In such a case there is no revoca- 
 tion, in the correct use of the word, but there is an interruption — an 
 effectual obstacle to the completion of the contract, equivalent in result 
 
 81 The death of the offeror extinguishes the power of acceptance, even 
 though (it appears) the offeree has no notice thereof. Jordan v. Dobbins, 122 
 Mass. 168, 23 Am. Rep. 305 (1877) ; National Eagle Bank v. Hunt, 16 R. I. 
 148, 13 Atl. 115 (1888); Vantassel v. Hathaway, 53 Me. 18 (1864); pnion Saw- 
 mill Co. V. Mitchell, 122 La. 900, 48 South. 317 (1909) ; Pratt v. Trustees of 
 Baptist Soc. of Elgin, 93 111. 475, 34 Am. Rep. 187 (1879),; TWenty-Third 
 Street Baptist Church r. Cornell, 117 N. Y. 601, 23 N. E. 177, 6 L. R. A. 807 
 (1890) ; Wallace v. Townsend, 43 Ohio St. 537, 3 N. E. 601, 54 Am. Rep. 829 
 <1885) ; In re Helfenstein's Estate, 77 Pa. 328, 18 Am. Rep. 449 (1875). .So 
 also insanity. Beach v. First Methodist Episcopal Church, 96 111. 177 ^1880), 
 
172 OFFER AND ACCEPTANCE (Ch. 1 
 
 to a revocation, though operating by very dififerent facts and very dif- 
 ferent principles. Revocation or recall is an act of the offerfer; by 
 which he communicates his change of purpose, and withdraws from 
 the offeree the right [power] he had given him to complete the contract 
 by acceptance. Having communicated his purpose to purchase, the 
 offeree is entitled to regard that purpose as unchanged until a change 
 is communicated. He has acquired a right [power], which he re- 
 tains until it is withdrawn from him by a communication from the 
 party who conferred it. If he exercises the right [power] by a com- 
 pleted act of acceptance of the offer before notice has reached him, or 
 ought in ordinary course to have reached him, the contract will be bind- 
 ing, although a change of mind on the part of the offerer had taken 
 place, and although he had taken a step towards communicating that 
 change of mind by writing a letter, or even putting it into the post- 
 office. In a great many cases the maxim that there must be a con- 
 currence of will at the moment of completion of the contract cannot 
 be rigidly or hterally applied. The very opposite may be the fact. 
 Although one cannot, by accepting an offer, bind a dead or insane 
 person, he may bind an unwilling person, one who has altogether 
 changed his mind. Such cases are not unfrequent. If an offer bears 
 that it is to be binding for a certain number of days or hours, the of- 
 ferer may repent before the lapse of the given time, and yet at the 
 end of it may find himself unwillingly bound; or if an' offerer changes 
 his mind, but does not take the proper steps to have his change of 
 mind conveyed to the offeree, — either writes no letter, or writes a let- 
 ter which he omits to send, or sends it by mistake to a wrong place, — 
 he may find himself unwillingly bound. Other cases may be figured. 
 Mere change of mind on the part of the offeree will not prevent an 
 effectual acceptance, — not even although that change of mind should 
 be evinced by having been communicated to a third party, or recorded 
 in a formal writing, as for instance in a notarial instrument. In all 
 these cases a binding contract may be made between the parties with- 
 out that consensus or concursus which a rigidly literal reading of the 
 maxim or rule would require. 
 
 Upon the grounds now indicated, I hold that the mere putting of the 
 letter of recall into a distant post-office before the acceptance was 
 sent off did not put an end to the offer and exclude the power of the 
 offeree, to bind the offerer by accepting the offer. I hold that a letter 
 of recall has no effect till the recall has become known to the of- 
 feree, or should in due course have become known to him. In the 
 present case the letter of recall reached its destination on 2d December, 
 and on that day became Imown to the pursuers. The letter of ac- 
 ceptance had been posted on the preceding day, the 1st of December; 
 but it is averred that it had not reached its destination when the recall 
 was received on the, morning of the 2d. I hold that, in the circum- 
 stance^ averred, the delivery and receipt of the letter of recall did not 
 
Sec. 9) LAPSE OP OPFEB — POWER OF REVOCATION 173 
 
 interrupt or prevent the completion of the contract. I do not think 
 that the principle to which I have referred^ as that applicable to the 
 recall of an oiler, applies equally to the acceptance of an offer ; or that 
 everything which must be done, in order to effectuate the recall of an 
 offer, must, in like manner, be done in order to give effect to the ac- 
 ceptance of an offer. The two things are in their nature different. The 
 one consists in effectually undoing something that the party himself 
 has already done, and which binds him unless it is effectually undone; 
 the other consists in merely acceding to a proposal made. What it is 
 that the acceptor must do in order to make his acceptance effectual, 
 and to put it out of the power of the offerer to recall his offer, depends 
 on circumstances. Some things he must do. He must make his accept- 
 ance in writing, and he must send forth or give up that writing to or 
 for behoof of the offerer. It is not enough that he commits his ac- 
 ceptance to writing and locks it in his own repositories ; and, on the 
 other hand, it is not necessary that he shall deliver it personally to 
 the offerer. When an offer is made by letter from a distance through 
 the medium of the post, the offerer selecting that medium of trans- 
 mission authorizes and invites the offeree to communicate his accept- 
 ance through the same medium. If the offeree avails himself of that 
 medium of communication, and transmits his acceptance, properly 
 addressed through the post-office, and if the acceptance reaches its 
 destination in the due and regular course of that medium of trans- 
 mission, I am of opinion that the act of acceptance was completed by 
 thc; putting of the letter into the post-office j and that a letter of recall, 
 which did not arrive till after that act, cannot be held to have inter- 
 rupted the completion of the contract. By putting the letter of ac- 
 ceptance into the post-office, the offeree did just what he was invited to 
 do, and all that it was incumbent on him or possible for him to do 
 in the way of acceptance, by the mode of communication which he was 
 authorized, if not invited, by the offerer to adopt. * * * 
 
 IvOrd CuRRiEHiLL, [in a dissenting opinion, said :] But the defend- 
 er's offer tp the pursuers, although it did not create a binding obliga- 
 tion on him so long as nothing followed upon it, had then the twofold 
 effect of conferring one power upon the pursuers, and of reserving 
 another power to the defender himself. On the one hand, the power 
 which was thereby conferred upon the pursuers was to accept the 
 offer at any moment, within a reasonable period, so as to bind them- 
 selves to perform the counterpart of the proposed contract of sale. 
 That was an implied condition of the offer, and there was placed in the 
 pursuers the option of purifying that condition by accepting the offer 
 within due time. As the period of time which was allowed for ac- 
 ceptance, is not stated in the offer, it might have been a question of 
 some nicety how long it was to endure ; but that question is not raised 
 in the present case. 
 
174 OFPBE AND ACCEPTANCE (Ch. 1 
 
 On the other hand, the power which the defender reserved to him- 
 self was to retract that offer, and thereby put an end to it at any mo- 
 ment, so long as the pursuers did not exercise their power by accepting 
 of the offer to the effect above mentioned/^ * * * 
 
 DICKINSON V. DODDS. 
 (In the Court of Appeal, Chancery Division, 1876. 2 Ch. Div. 463.) 
 
 On Wednesday, the 10th of June, 1874,' the defendant John Dodds 
 signed and delivered to the plaintiff, George Dickinson, a memoran- 
 dum, of which the material part was as follows : 
 
 "I hereby agree to sell to Mr. George Dickinson the whole of the 
 dwelling-houses, garden ground, stabling, and outbuildings thereto be- 
 longing, situate at Croft, belonging to me, for the sum of £800. As 
 witness my hand this tenth day of June, 1874. 
 
 "iSOO. " [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." 
 
 The bill alleged that Dodds understood and intended that the plain- 
 tiff should ha,ve until Friday, 9 a. m., within which to determine wheth- 
 er he would or would not purchase, and that he should absolutely 
 have until that time the refusal of the property at the price of £800, 
 and that the plaintiff in fact determined to acCept the offer on the morn- 
 ing of Thursday, the 11th of June, but did not at once signify his ac- 
 ceptance to Dodds, believing that he had the power to accept it until 
 9. a. m. on the Friday. 
 
 In the afternoon of the Thursday the plaintiff was informed by a 
 Mr. Berry that Dodds had been offering or agreeing to sell the prop- 
 erty to Thomas Allan, the other defendant. Thereupon the plaintiff, 
 at about half past seven in the evening, went to the house of Mrs. Bur- 
 gess, the mother-in-law of Dodds, where he was then staying, and left 
 with her a formal acceptance in writing of the offer to selPthe proper- 
 ty.' According to the evidence of Mrs. Burgess this document never in 
 fact reached Dodds, she having forgotten to give it to him. 
 
 On the following (Friday) morning, at about seven o'clock, Berry, 
 who was acting as agent for Dickinson, found Dodds at the Darlington 
 railway station, and handed to him a duplicate of the acceptance by 
 Dickinson, and explained to _Dodds its purport. He replied that it was 
 too late, as he had sold the property. A few minutes later Dickinson 
 himself found Dodds entering a railway carriage, and handed him an- 
 other duplicate of the notice of acceptance, but Dodds declined to re- 
 ceive it, saying : '"You are too late. I have sold the property." 
 M It appeared that on the day before, Thursday, the 11th of June, 
 Dodds had signed a formal contract for the sale of the property to the 
 
 »2 The opinions of the judges and arguments of the advocates are printed at 
 length in LangdeU's Cases on Contracts. 
 
Sec. 9) LAPSE OF OFFER — POWER OF REVOCATION 175 
 
 defendant Allan for £800, and had received from him a deposit of 
 £40. 
 
 The bill in this suit prayed that the defendant Dodds might be de- 
 creed specifically to perform the contract of the 10th of June, 1874; 
 that he might be restrained from conveying the property to Allan; 
 that Allan might be restrained from taking any such conveyance ; that, 
 if any such conveyance had been or should be made, Allan might be 
 declared a trustee of the property for, and might be directed to convey 
 the property to, the plaintiff; and for damages. 
 
 The cause came on for hearing before Vice Chancellor Bacon on the 
 25th of January 1876. [It was his opinion that Dodds could withdraw 
 only by giving notice to Dickinson, in spite of Cooke v. Oxley, 3 T. R. 
 653, and that the contract took effect by the doctrine of relation back 
 as of the time of the offer and hence was prior to the sale to Allan. 
 He therefore decreed specific performance in favor of the plaintiff. 
 From the decision both of the defendants appealed.] 
 
 James, L. J., after referring to the document of the 10th of June, 
 1874, continued: 
 
 The document, though beginning "I hereby agree to sell," was noth- 
 ing but an offer, and was only intended to be an offer, for the plaintiff 
 himself tells us that he required time to consider whether he would 
 enter into an agreement or not. Unless both parties had then agreed, 
 there was no concluded agreement then made; it was in effect and 
 substance only an offer to sell. The plaintiff, being minded not to 
 complete the bargain at that time, added this memorandum: "This 
 offer to be left over until Friday, 9 o'clock a. m. 12th June, 1874." 
 That shows it was only an offer. There was no consideration given 
 for the undertaking or promise, to whatever extent it may be consid- 
 ered binding, to keep the property unsold until 9 o'clock on Friday 
 morning;; but apparently Dickinson was of opinion, and probably 
 Dodds was of the same opinion, that he (Dodds) was bound by that 
 promise, and could not in any way withdraw from it, or retract it,'un- 
 til 9 o'clock on Friday morning, and this probably explains a good 
 deal of what afterward? took place. But it is clear settled law, on 
 one of the clearest principles of law, that this promise, being a mere 
 nudum pactum, was not binding, and that at any moment before a 
 complete acceptance by Dickinson of the offer, Dodds was as free as 
 Dickinson himself. Well, that being the state of things, it is said that 
 the only mode in wliich Dodds could assert that freedom was b}' actu- 
 ally and distinctly saying to Dickinson^ "Now I ■ withdraw my offer." 
 It appears to me that there is neither principle nor authority for the 
 proposition that there must be an express and actual withdrawal of the 
 offer, or what is called a retractation. It must, to constitute a contract, 
 appear that the two minds were at one, at the same moment of time, 
 that is, that there was an offer continuing up to the time of the accept- 
 ance. If there was not such a continuing offer, then the acceptance 
 comes to nothing. Of course it may well be that the one man is bound 
 
176 ' OFFER AND ACCEPTANCE ' (Ch. 1 
 
 in some way or other toilet the other man know that his mind with re- 
 gard to the offer has been changed ; but in this case, beyond all ques- 
 tion, the plaintifif knev/ 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." This is evident from the plain- 
 tiff's own statements-in the bill. 
 
 The plaintiff says in effect that, having heard and knowing that 
 Dodds was no longer minded to sell to him, and that he was selling or 
 had sold to some one else, thinking that he could not in point of law 
 withdraw his offer, meaning to fix him to it, and endeavoring to bind 
 him : "I went to the house where he was lodging, and saw his mother- 
 in-law, and left with her an acceptance of the offer, knowing all the 
 while that he had entirely changed his mind. , I got an agent to watch 
 for him at 7 o'clock the next morning, and I went. to the train just be- 
 fore 9 o'clock, in order that I might catch him and give him my notice 
 of acceptance just before 9 o'clock, and when that occurred he told my 
 agent, and he told me, 'You are too late,' and he then threw back the 
 paper." It is to my mind quite clear that before there was any attempt 
 at acceptance by the plaintiff, he was perfectly well aware that Dodds 
 had changed his mind, and that he had in fact agreed to sell the prop- 
 erty to Allan. It is impossible, therefore, to say there was ever "that 
 existence of the same mind between the two parties which is' essential 
 in point of law to the making of an agreement. I am of opinion, there- 
 fore, that the plaintiff has failed to prove that there was any binding 
 contract between Dodds and himself. 
 
 Mellish, D. J. I am of the same opinion. The first question is, 
 Whether this document of the 10th of June, 1874, which was signedby 
 Dodds, was an agreement to sell, or only an offer to sell, the property 
 therein mentioned to Dickinson; and I am clearly of opinion that it 
 was only an offer, although it is in the first part of it, independently of 
 the postscript, worded as an agreement. I apprehend that, until ac- 
 ceptance, so that both parties are bound,, even though an instrument is 
 so worded as to express that both parties agree, it is in point of law 
 only an offer, and, until both parties are bouftd, neither party is bound. 
 It is not necessary that both parties should be bound within the stat- 
 ute of frauds,' for, if one party^ makes an offer in writing, and the oth- 
 er accepts it verbally, that will be sufficient to bitid the person who has 
 signed the written document. But, if there be no . agreement, either 
 verbally or in writing, then, until acceptance, it ife in point of law an 
 offer only, although worded as if it were an agreement. But it is 
 hardly necessary to resort to that doctrine in the present case, because 
 the postscript calls it an offer, and says, "This offer to be left over un- 
 til Friday, 9 o'clock a. m." Well, then, this being only an offer, and 
 the law says. — and it is a perfectly clear rule of law — that, although 
 it is said that the offer is to be left open until -Friday morning at 9 
 o'clock, that did not bind Dodds. He was not in point of law bound 
 to: hold the offer over until 9 o'clock on Friday morning.' He was not 
 
Sec. 9) LAPSE OF OFFER — POWEB OF REVOCATION 177 
 
 SO bound dther in law or in equity. Well, that being so, when on the 
 next day he made an agreement with Allan to sell the property to him, 
 I am not aware of any ground on which it can be said that that con- 
 tract with Allan was not as good and binding a contract as ever was 
 made. Assuming Allan to have known (there is some dispute about 
 it, and Allan does not admit that he knew of it, but I will assume that 
 he did) that Dodds.had made the offer to Dickinson, and had given 
 him till Friday morning at 9 o'clock to accept it, still in point of law 
 that could not prevent Allan from making a more favorable ofifer than 
 Dickinson, and entering at once into a binding agreement with Dodds. 
 Then Dickinson is informed by Berry that the property has been sold 
 by Dodds to Allan. Berry does not tell us from whom he heard it, 
 but he s.ays that he did hear it, that he knew it, and that he inform- 
 ed Dickinson of it. Now, stopping there, the question which arises 
 is this: If an ofifer has been made for the sale of property, and 
 before that ofifer is accepted the person who has made the offer en- 
 ters into a binding agreement to sell the property to somebody else, 
 and the person to whom the ofifer was first made receives notice in 
 some way that the property has been sold to another person, can he 
 after that make a binding contract by the acceptance' of the ofifer? 
 I am of opinion that he cannot. The law may be right or wrong in 
 saying that a person who has given to another a certain time within 
 which to accept an ofifer is not bound by his promise to give that 
 time; but, if he is not bound by that promise, and may still sell the 
 property to some one else, and if it be the law that, in order to 
 make a contract, the two minds must be in agreement at some one time, 
 that is, at the time of the acceptance, how is it possible that when the 
 person to whom the ofifer has been made knows that the person who 
 has made the ofifer hals sold the property to some one else, and that, in 
 fact, he has not remained in the same mind to sell it to him, he can be 
 at liberty to accept the ofifer and thereby make a binding contract ? It 
 seems to me that would be simply absurd. If a man makes an ofifer to 
 sell a particular horse in his stable, and says, "I will give you until the 
 day after to-morrow to accept the ofifer," and the next day goes and 
 sells the horse to somebody else, and receives the purchase money from 
 him, can the person to whom the ofifer was originally made then come 
 and say, "I accept," so as td make a binding contract, and so as to be 
 entitled to recover damages for the non-delivery of the horse? If the 
 rule of law is that a mere ofifer to sell property, which can be with- 
 drawn at any time, and which is made dependent on the acceptance of 
 the person to whom it is made, is a mere nudum pactum, how is it 
 possible that the person to whom the offer has been made can by ac- 
 ceptance make a binding contract after he knOws that the person who 
 has made the ofifer has sold the property to some one else? It is ad- 
 mitted la,w that, if a man who makes an ofifer dies, the ofifer cannot be 
 accepted after he-is dead ; and parting with the property has very much 
 the sarne efifect as the' death of the owner, for it makes the perform- 
 
 COBBIN CONT.— 12 
 
178 OFFER AND ACCEPTANCE (Cll. 1 
 
 ance of the offdr impossible. I am clearly of opinion that, just as when 
 a man who has made an offer dies before it is accepted it is impossible 
 that it can then be accepted, so when once the person to whom the offer 
 was made knows that the property has been sold to some one else, it is 
 too late for him to accept the offer, and on that ground I am clearly of 
 opinion that there was no binding contract for the sale of this property 
 by Dodds to Dickinson; and, even if there had been, it seems to me 
 that the sale of the property to Allan was first in point of time. How-' 
 ever, it is not necessary to consider, if there had been two binding con- 
 tracts, which of them would be entitled to priority in equity, because 
 there is no binding contract between Dodds and Dickinson. 
 
 BaggalIvAY, J. A. I entirely concur in the judgments which have 
 been pronounced. 
 
 Jambs, L. J. The bill will be dismissed, with costs."* 
 
 SHUEY V. UNITED STATES. 
 (Supreme Court of the United States, 1875. 92 U. S. 73, 23 L. Ed. 697.) 
 
 Appeal from the Court of Claims. 
 
 Henry B. Ste. Marie filed his petition in the Court of Claims to 
 recover the sum of $15,000, being the balance alleged to be due him of 
 the reward of $25,000 offered by the Secretary of War, on April 20th, 
 1865, for the apprehension of John H. Surratt, one of Booth's alleged 
 accomplices in the murder of President Lincoln. 
 
 The Court below found the facts as follows : 
 
 1. On April 20th, 1865, the Secretary of War issued, and caused 
 to be published in the public newspapers and otherwise, a proclama- 
 tion, whereby he announced that there would be paid by the? War 
 Department "for the apprehension of John H. Surratt, one of Booth's 
 accomplices," $25,000 reward, and also that "liberal rewards will be 
 paid for any information that shall conduce to the arrest of either 
 of the above-named criminals or their accomplices;" and such proc- 
 lamation was not limited in terms to any specific period, and it was 
 signed "Edwin M. Stanton, Secretary of War." On November 24th, 
 1865, the President caused to be published his order revoking the 
 reward offered for the arrest of John H. Surratt. 13 Stat. 778. 
 
 2. In April, 1866, John H. Surratt was a zouave in the military 
 service of the Papal Government, and the claimant was also a zouave 
 in the same service. During that month he communicated to Mr. 
 King, the American Minister at Rome, the fact that he had discovered 
 and identified Surratt, who had confessed to him his participation in 
 
 9 3 In accord: Cartvvright v. Hoogstoel, 105 J->. T. 628 (1911) ; Coleman v. 
 Applegarth, 68 Md. 21, 21 Atl. 284, 6 Am. St. Kep. 417 (1887) ; Franli v. Strat- 
 ford-Handcock, 13 "Wyo. 37, 77 Pac. 134, 67 L. E. A. 571, 110 Am. St. Rep. 963 
 (1904) ; Watters v. Lincoln, 29 S. D. 98, 135 N. W. 712 (1912). And see Threl- 
 keld V. Inglett, 289 111. 90, 124 N. E. 368 (1919). 
 
Sec. 9) LAPSE OF OFFERS — POWER OP REVOCATION 179 
 
 the plot against the life of President L,incoln. The cljiimant also 
 subsequently communicated further information to the same effect, 
 and kept watch, at the request of the American Minister, over Sur- 
 ratt. Thereupon certain diplomatic correspondence passed between 
 the Government of the United States and the Papal Government rel- 
 ative to the arrest and extradition of Surratt; and on November 6th, 
 1866, the Papal Government, at the request of the United States, 
 ordered the arrest of Surratt," and that he be brought to Rome, he 
 then being at Veroli. Under this order of the Papal Government, 
 Surratt was arrested ; but, at the moment of leaving prison at Veroli, 
 he escaped from the guard having him in custody, and, crossing the 
 frontier of the Papal territory, embarked at Naples, and escaped to 
 Alexandria in Egypt. Immediately after his escape, and both before 
 and after his embarkation at Naples, the American Minister at Rome, 
 beiirig informed of the escape by the Papal Government, took meas- 
 ures to trace and rearrest him, which was done in Alexandria. From 
 that place he was subsequently conveyed by the American Govern- 
 ment to the United States; but the American Minister, having pre- 
 viously procured the discharge of the claimant from the Papal mil- 
 itary service, sent him forward to Alexandria to identify Surratt. At 
 the time of the first interview between the claimant and the Amer- 
 ican Minister, and at all subsequent times until the final capture of 
 Surratt, they were ignorant of the fact that the reward pffered by 
 the Secretary of War for his arrest had been revoked by the Presi- 
 dent. The discovery and arrest of Surratt were due entirely to tli.; 
 disclosures made by the claimant to the American Minister at Rome ; 
 but the arrest was not made by the claimant, either at Veroli, or sub- 
 sequently at Alexandria. 
 
 3. There has been paid to the claimant by the defendants, under 
 the Act of July 27th, 1868 (15 Stat. 234, § 3), the sum of $10,000. 
 Such payment was made by a draft on the Treasury payable to the 
 order of the claimant, which draft was by him duly indorsed. 
 
 The Court found as a matter of law that the claimant's service, as 
 set forth in ' the foregoing findings, did not constitute an arrest of 
 Surratt within the meaning of the proclamation, but was merely the 
 giving of information which conduced to the arrest. For such infor- 
 mation the remuneration allowed to him under the Act of Congress 
 was a full satisfaction, and discharges the defendants from all lia- 
 bility. 
 
 The petition was dismissed accordingly, whereupon an appeal was 
 taken to this Court. 
 
 Ste. Marie having died pendente lite, his executor was substituted 
 in his stead. 
 
 Strong, J. We agree with the Court of Claims, that the service 
 rendered by the plaintiff's testator was, not the apprehension of John 
 H. Surratt, for which the War Department had offered a reward of 
 $25,000, but giving information that conduced to the arrest. These are 
 
180 OFFEE ,AND ACCEPTANCE (Ch. 1 
 
 quite distinct, things, though one may have been a consequence of 
 the other. The proclamation of the Secretary of War treated, them 
 as different; and, while a reward of $25,000 was offered for the ap- 
 prehension, the offer for information was only a "liberal reward." 
 The findings of the Court of Claims also exhibit a clea.r distinction be- 
 tween making the arrest and giving the information that led to it. 
 It is found as a fact, that the arrest was not made by the claimant, 
 though the discovery and arrest were due entirely to the disclosures 
 made by him. The plain meaning of this is, that Surratt's apprehen- 
 sion was a consequence of the disclosures made. But the consequence 
 of a man's act are not his acts. Between the consequence and the 
 disclosure that leads to it there may be, and in this case there were, 
 intermediate agencies. Other persons than the claimant made the 
 arrest — persons who were not his agents, and who theniselves were 
 entitled to the proffered reward for his arrest, if any persons were. 
 We think, therefore, that at most the claimant was entitled to the 
 "liberal reward" promised for information conducing to the arrest; 
 and that reward he has received."* 
 
 But, if this were not so, the judgment given by the Court of Claims 
 is correct. 
 
 The offer of a reward for the apprehension of Surratt was revoked 
 on November 24th, 1865 ; and notice of the revo<;ation was pub- 
 lished. It is not to be doubted that the offer was revocable at any 
 time before it was accepted, and before anything had been done in 
 reliance upon it. There was no contract tmtil its terms were complied 
 with. Like any other offer of a contract, it might, therefore, be with- 
 drawn before rights had accrued under it; and it was withdrawn 
 through the same channel in which it was made. The same notoriety 
 was given to the revocation that was given to the offer ; and the find- 
 ings of fact do not show that any information was given by the claim- 
 ant, or that he did anything to entitle him to the reward offered, until 
 .five months after the offer had been withdrawn. True, it is found 
 that then, and at all times until the arrest was actually made, he 
 was ignorant of the withdrawal; but that is an immaterial fact. The 
 offer of the reward not having been made to him directly, but by 
 means of a published proclamation, he should have known that it 
 could be revoked in the manner in which it was made.. 
 
 Judgnient affirnjed.'^ 
 
 »* McOlaughry v. King, 147 Fed. 463, 79 O. C. A. 91, 7 L. E. A. (N. S.) 216 
 and note 8 Aim. Gas. 856 (1906), "a reward offered for the arrest of a criminal 
 is not earned by giving the information that leads to hi$ arrest." Cf. Choice 
 V. Dallas, ante, p. 24; Stone v. Dysert, 20 Kan. 123 (1878); Hall v. State, 
 102 Wash. 519, 173 Pac. 429 (1918) ; Blldns v. Board of Com'rs of Wyandotte 
 County, 91 Kan. 518, 188 Pac. 578, 51 L. R. A. (N. S.) 638, Ann. Cas. 1915D, 257 
 (1914) I Id„ 86 Kan. 305, 120 Pac. 542, 46 L. K. A. (N. S.) 662 (1912). 
 
 5 See, also. Sears v. Eastern R. Co., 14 Allen (Mass.) 433, 92 Am. Dec. 780 
 (1867), railroad can change time-table by giving proper published notice, even 
 though tickets have been bought. The saflie rule is adopted in the German 
 Civil Code, § 658, and in the Jap. Civil Code, art. 530. 
 
Sec. 9) LAPSE OB' OFFER — POWER OF REVOCATION 181 
 
 OFFORD V. DA VIES et al. - 
 (In the Cotift of Common Pleas, 1862. 12 O. B. N. S. 748.) 
 
 This was an action upon a guarantee. 
 
 The first count of the declaration stated that, by a certain instru- 
 ment in writing signed by the defendants, and addressed and dehvered 
 by tne defendants to the plaintiff, the defendants undertook, promised, 
 and agreed with the plaintiff in the words and figures following — that 
 is to say ; "We, the undersigned, in consideration of your discounting, 
 at our request, bills of exchange for Messrs. Davies & Co., of Newtown, 
 Montgomeryshire, drapers, hereby jointly and severally guarantee for 
 the space of twelve calendar months the due payment of all such bills 
 of exchange, to the extent of £600. And we further jointly and sev- 
 erally undertake to make good any loss or expenses you may sustain 
 or incur in consequence of advancing Messrs. Davies & Co. such mon- 
 eys." Averment, that the plaintifif, relying on the said promise of the 
 defendants, after the making of the said promise, and within the space 
 of twelve calendar months thereafter, did discount divers bills of ex- 
 change for the said Messrs. Davies & Co, of Newtown aforesaid, cer- 
 tain of which bills of exchange became due and payable before the com- 
 mencement of this suit, but were not then' or at any other time duly 
 paid, and the said bills respectively were dishonored; and that the 
 plaintiff, after the making of the said promise, and within the said 
 twelve calendar months, advanced to the said Messrs. Davies & Co. 
 divers sums of money on and in respect of the discount of the said 
 last-mentioned bills so dishonored as aforesaid, certain of which mon- 
 eys were due and owing to the plaintiff before and at the time of the 
 commencement of this suit ; and that all things had happened and all 
 times had elapsed necessary, etc. ; yet that the defendants broke their 
 said promise, and did not pay to the plaintiff or to the respective hold- 
 ers for the timelDeing of the said bills of exchange so dishonored as 
 aforesaid, or to any other person entitled to receive the same, the re- 
 spective sums of money payable by the said bills of exchange ; nor did 
 the defendants pay to the plaintiff the said sums of money so advanced 
 by the plaintiff as aforesaid, or any part thereof; whereby the sums 
 payable by the said bills of exchange so dishonored as aforesaid be- 
 came lost to the plaintiff, and he became liable to pay and take up cer- 
 tain of the said bills of exchange, and did pay and take up certain of 
 the said bills of exchange, and was forced and obliged to and did ex- 
 pend certain moneys in endeavoring to obtain part of certain of the 
 said bills of exchange, and the plaintiff lost the interest which he might 
 have made of his moneys if the said bills had been duly paid at ma- 
 turity. 
 
 Fourth plea to the first count — so far as the same relates to the sums 
 payable by the defendants in respect of the sums of money- payable by 
 the said bills of exchange and the said sums so advanced — that, after 
 
182 OFFER AND ACCEPTANCE (Ch. 1 
 
 the making of the said guarantee, and before the plaintiff had discount- 
 ed such bills of ex'change, and before he had advanced such sums of 
 money, the defendants countermanded the said guarantee, and request- 
 ed the plaintiff not to discount such bills of exchange, and not to ad- 
 vance such moneys. 
 
 To this plea the plaintiff demurred, the ground of demurrer stated 
 in the margin being, "that the fourth plea offers no defence to that part 
 of the declaration to which it is pleaded, for that a party giving a guar- 
 antee [for a definite period] has no power to countermand it without 
 the assent of the person to whom it is given." Joinder. 
 
 Prentice (with whom was Brandt), in support of the demurrer. A 
 guarantee like this, to secure advances for twelve months, is a contract 
 which cannot be rescinded or countermanded within that time without 
 the assent of the person to whom it is given'. [Byles, J. What con- 
 sideration 'have these defendants received ?] For anything disclosed by 
 the plea the plaintiff might have altered his position in consequence of 
 the guarantee, by having entered into a contract with Davies & Co., of 
 Newtown, to discount their bills for twelve months. * * * Here, 
 the defendants have stipulated that their liability shall discontinue at the 
 end of twelve calendar months. What pretence is there for relieving 
 them from that bargain? [BylEs, J. Suppose a man gives an open 
 guarantee, with a stipulation that he will not withdraw it, — what is there 
 to bind him to that ?] If acted upon by the other party, it is submitted 
 that that would be a binding contract. *, * * 
 
 E. James, Q. C. (with whom was T. Jones), contra. The cases upon 
 bonds for guaranteeing the honesty of clerks or servanta are inapplica- 
 ble: there the contract attaches as soon as the clerk or servant enters 
 the service, and it is not separable. This however, is not a case of con- 
 tract at all. It is a mere authority to discount, and a promise to in- 
 demnify the plaintiff in respect of each bill discounted; and it was 
 perfectly competent to the defendants at any time to withdraw that 
 authority as to future transactions of discount. *" * * Suppose 
 Davies & Co., of Newtown had become notoriously insolvent, would the 
 defendants continue bound by their guarantee if the plaintiffs, with no- 
 tice of that fact, chose to go on discounting for them? [Williams, J. 
 Suppose I guarantee the price of a carriage to be built for a third party 
 who, before the carriage is finished and consequently before I am bound 
 to pay for it, becomes insolvent, — may I recall my guarantee?] Not 
 after the coach-builder has commenced the carriage. [ErlE, C. J. 
 Before it ripens into a contract, either party may withdraw, and so put 
 an end to the matter. But the moment the coach-builder has prepared 
 the materials, he would probably be found by the jury to have contract- 
 ed.] * * * [ErlS, C. J. What meaning do you attribute to the 
 words "at our request" in this guarantee?] As and when we request. 
 The notice operated a retractation of the request, and any discount 
 which took place after that notice was not a discount at the request of 
 the defendants. 
 
Sec. 9) LAPSE OF OFFER — POWER OP REVOCATION 183 
 
 Brandt in reply. The Court of Exchequer have decided in this 
 terra, in a case of Bradbury v. Morgan, 31 Law J. Exch. 462 (1 H. & 
 C. 249), that the death of the surety does not operate a revocation of a 
 continuing guarantee. If that'be so, it is plain that the guarantee is not 
 a mere mandatum, but a contract. * * * The fourth plea does not 
 allege that notice of revocation was given before any bills had been 
 discounted by the plaintiffs. It must therefore be assumed that some 
 discounts had taken place. (T. Jones. The fact undoubtedly is so.) 
 Cur. adv. vult.''^ 
 
 Erle, C. J., now delivered the judgment of the Court. 
 
 The declaration alleged a contract by the defendants, in consideration 
 that the plaintiff would at the request of the defendants discount bills 
 for Davies & Co., not exceeding £600, the defendants promised to 
 guarantee the repayment of such discounts for twelve months, and the 
 discount, and no repayment. The plea was a revocation of the prom- 
 ise before the discount in question ; and the demurrer raises the ques- 
 tion whether the defendants had a right to revqke the promise. We 
 are of opinion that they had, and that consequently the plea is good. 
 
 This promise by itself creates no obligation. It is in effect condi- 
 tioned to be binding if the plaintiff acts upon it, either to the benefit of 
 the defendants, or to the detriment of himself. But, until the condi- 
 tion has been at least in part fulfilled, the defendants have the power 
 of revoking it. In the case of a simple guarantee for a proposed loan, 
 the right of revocation before the proposal has been acted on did not 
 appear to be disputed. Then, are the rights of the parties affected ei- 
 ther by the promise being expressed to be for twelve months, or by the 
 fact that some discounts had been made before that now in question, 
 and repaid? We think not. 
 
 The promise to repay for twelve months creates no additional liabili- 
 ty on the guarantor, but, on the contrary, fixes a limit in time beyond 
 which his liability cannot extend. And, with respect to other dis- 
 counts, which had been repaid, we consider each discount as a separate 
 transaction, creating a liability on the defendant till it is repaid, and, 
 after repayment, leaving the promise to haye the same operation that 
 it had before any discount was made, and no more. 
 
 Judgment for the defendants."^ 
 
 9 6 Parts of the report are omitted. 
 
 9^ In Christie, Lowe & Hey worth v. Patton, 148 Ala. 324, 42 South. 614 
 (1906), defendant wrote: "We will put on our work any number of teartfs 
 you care to furnish * * * and will pay * * * three dollars." After 
 plaintiff had furnished a varying number of teams, he was notified to send 
 no more. This was no breach of legal duty. Cf. also, Great Northern Ry. v. 
 Witham, post, p. -298. 
 
184 OFFER AND ACCEPTANCE (Cb. 1 
 
 CONSOLIDATED PORTRAIT & FRAME CO. v. BARNETT 
 
 et al. 
 (Supi-eme Court of Alabama, 1910. IftS Ala. 655, 51 South. 936.) 
 
 Action by tbe ConsoHdated Portrait & Frame Company against M. 
 P. Barnett and others. Judgment for defendants, and plaintiff appeals. 
 Affirmed. 
 
 The letter of credit referred to is in the following language : "Letter 
 of Credit. Town of Goqdwater, .State, of Alabama, May 28, 1907. 
 Consolidated Portrait & Frame Co. — Gentlemen : Should T. W. Adair 
 order goods of you at one or more times within the next twelve months 
 from the date of this letter of credit, we jointly and severally re- 
 quest that you ship said goods to his order, allowing credit of thirty 
 days from date of shipment; and if the said T. W. Adair shall fail 
 to pay for such goods within thirty days after date of shipment, we 
 agree to pay for said goods at the price you charged him for same, 
 provided our responsibility shall not exceed $200.00. We waive all 
 notice to us of shipment made to said T. W. Adair on the faith of 
 this letter of credit, as well as notice that he failed to pay for such 
 goods ; , and in case the collection of the amount dUe to you by virtue 
 of the credit you extend the said T. W. Adair by virtue of this letter 
 of credit is forced by suit, we agree to pa.j all court costs, attorney's 
 fees, and the attorney's fees may be included in the judgment [and 
 the plaintiff claims $10 attorney's fee for bringing this suit] . Por the 
 purpose of enabling T. W. Adair to obtain credit from your house, 
 we represent tliat we are worth not less than $1,000.00 over and above 
 exemptions, liabilities, and obligations of all kinds which we now have. 
 M. P. Barnett & Bros. J. U. Bridges." 
 
 Plea 3 is as follows: "The defendants M. P. Barnett and J. U.. 
 Bridges signed said letter of credit without any consideration money to; 
 them, same being purely an accommodation paper so far as they were> 
 concerned, and on or about the 21st of September, 1907, said defend- 
 ants J. U. Bridges and M. P. Barnett demanded back -said letter of 
 credit, and at that time the said T. W. Adair was not indebted to tha 
 plaintiff in any sum which said letter of credit was given to secure; 
 and, if defendant T. W. Adair is indebted to plaintiffs in any sum, it 
 is an indebtedness created after said demand by said defendants for said 
 letter of credit." 
 
 Simpson, j.ss * * * ^ consideration is necessary to the binding 
 efficacy of a contract, and a contract in which one party offers to do 
 something or, to pay money when the other party does something else, 
 and does not contain any promise or obligation of the other party to do 
 or pay anything, is unilateral, without mutuality, and subject to rev- 
 ocation at any time before the. party to whom it is addressed does or 
 performs any act on the faith of said proposition. 9 Cyc. 327 et seq. ; 
 
 98 Part of the opinion is omitted. 
 
Sec. 9) LAPSE OF OFFER — :POWEE OF KEVOCATION 185 
 
 Chambliss v. Smith, 30 Ala. 367 ; Borst v. Simpson, 90 Ala. 373, 376, 
 7 South. 814. 
 
 There was no error in overruling the demurrers to the plea. The 
 judgment of the court is affirmed. 
 
 Affirmed. 
 
 \ 
 
 HOPKINS V. RACINE MALLEABLE & WROUGHT IRON CO. 
 (Supreme Court of Wisconsin, 1909. 137 Wis. 583, 119 N. W. 301.) 
 
 Action by Floyd Hopkins against the Racine Malleable & Wrought 
 Iron Company. Judgment for plaintiff. Defendant appeals. Re- 
 versed and remanded, with directions to dismiss. 
 
 The pjaintiff having secured a patent upon a certain farm gate and 
 having had some undisclosed negotiations with the defendant, a .man- 
 ufacturer of malleable irons, the latter on March 10, 1905, mailed 
 to him the following writing: "Hopkins' Gate Contract. The Racine 
 Malleable & Wrought Iron Company of the city of Racine, state of 
 Wisconsin, hereby agrees with Floyd Hopkins of the town of Belvi- 
 dere, county of Boone, state of Illinois, to furnish, at any time hereafter 
 during the life of the patent, castings for the patent improved farm 
 gate of said Hopkins, known as the Hopkins' gate, patented January 
 3, 1905, as follows, to wit: * * * We agree to furnish the above- 
 named castings for forty cents per set at our shops to be shipped to 
 any point of the United States or Canada, the price aforesaid to be for 
 cash at Racine, Wis. * * * There was no reply, but from time to 
 time, up to July, 1906, the plaintiff ordered castings in quantities from 
 50 to 150 sets, and they were supplied by the defendant, who seems 
 to have manufactured a quantity in order to be able to furnish them 
 as ordered. 
 
 On April 30, 1906, defendant wrote plaintiff' that by reason of re- 
 organization of its business it was a question whether it could continue 
 to make or furnish the gate castings, and that it wrote in order to give 
 plaintiff an opportunity to find some other place to have them made ; 
 that, while it still had some irons on hand, it did not care to carry on 
 the business in the old way by carrying stock and shipping all over 
 the country when wanted ; that it had no room for storage nor facil- ■ 
 ities for packing and shipping. Again, on October 29, 1906, the de- 
 fendant wrote him that it had approximately 400 sets of castings on 
 hand, but was unwilling to continue the business after that stock was 
 exhausted by carrying other stock, saying that the plaintiff would have 
 to make a;rrangements to carry the stock elsewhere, and also stating: 
 "We do not object to making your castings for you, but after the goods 
 are made, they must be shipped out of here. We cannot carry a stock. 
 * * * Orders that are placed after the stock on hand now is ex^ 
 hausted will be billed at revised prices." December 14th it-wrote again : 
 "The time is drawing near when we can no longer accept such con- 
 
186 OFFER AND ACCEPTANCE (Cll. 1 
 
 tracts. * * * What stock we have made up, which is about 350 
 sets, we will close out, but we can no longer make these castings and 
 carry them in stock for you, and have you draw them from this stock. 
 You will have to make arrangements to carry the stock elsewhere." 
 
 On December 27, 1906, plaintiff mailed to the defendant, what is 
 called an order, the 'following letter : "I wish one thousand sets of 
 Farmer Hopkins' gate castings patented January 3, 1905, manufactured 
 and ready for delivery May 1, 1907. Will give you shipping directions 
 later." To which the defendant replied January 30th : "It is not pos- 
 sible for us to make the thousand set of Farmer Hopkins' gate castings 
 at the present time" — asserting as a reason the quantity of other work. 
 * * * Plaintiff, on April 9, 1907, entered into a contract with an- 
 other manufacturer to manufacture a thousand sets of castings for 
 the same purpose, at a price of 55 cents per set. Plaintiff brought suit 
 for damages for defendant's refusal to comply with the order of De- 
 cember 27, 1906, and judgment was rendered by the court, without a 
 jury, for damages at the rate of 15 cents per set, or $150, from which 
 the defendant appeals. °° 
 
 Dodge, J. (after stating the facts as above). No principle is* more 
 elementary in the law of contracts than that consideration is essential 
 to their validity, and that a wholly executory contract for mutual 
 acts is of no binding force upon one party unless and until the other 
 has become bound thereby. In such a contract mutuality is an essen- 
 tial of validity. Dodge v. Hopkins, 14 Wis. 636 ; Moulton v. Kershaw, 
 59 Wis. 316, 18 N. W.' 172, 48 Am. Rep. 516; Teipel v. Meyer, 106 
 Wis. 41, 81 N. W. 982. That rule has received modification to the 
 extent that an executory promise by one party may be construed to 
 evince his intention to make a continuing offer of such performance 
 which, when accepted, in whole or in part, by the other party, becomes 
 a contract pro tanto to the extent of the acceptance. Such offers are 
 very common in the mercantile world and are a basis on which mer- 
 cantile business, is largely transacted. Being in a sense a departure 
 from the fundamental principle of the necessity for consideration, in 
 the form of mutuality or otherwise,' the exception is carried no further 
 than to bind the offerer so long as he sees fit to keep the offer open. 
 
 In the present case, the promise of the defendant to furnish castings 
 was wholly executory and upon condition that the plaintiff should do 
 acts in the future. There is not the slightest suggestion that the plain- 
 tiff ever, even in the most informal manner, bound himself to the con- 
 ditions expressed in that offer. With him it was entirely optional at 
 all times to purchase his supplies of irons wherever he chose. True, as 
 he from time to time ordered a shipment from the defendant, he became 
 bound to pay for such shipment according to the terms of the offer, 
 and then, for the first time, did defendant become bound to fill his or- 
 der. This is the vital and fundamental distinction between the present 
 
 »8 The statement bas been shortened. 
 
Sec. 9) LAPSE OF OFFER — POWER OF REVOCATION 187 
 
 case and the authorities from this and other courts cited by the re- 
 spondent. In. each of those cases there were express words on the 
 part of the purchaser binding him to performance upon his part to the 
 full extent responsive to the offer made, albeit the promise was in some 
 of the cases ambiguous. Shadbolt v. TopHfiE, 85 Wis. 513, 55 N. W. 
 854; Walsh v. Myers, 92 Wis. 397, 66 N. W. 250; McCall v. Icks, 
 107 Wis. 232, 83 N. W. 300; Excelsior Wrapper Co. v. Messinger, 116 
 Wis. 554, 93 N. W. 459; Taylor Co. v. Bannerman, 120 Wis. 189, 97 
 N. W. 918; Eastern Ry. Co. v. Tuteur, 127 Wis. 382, 105 N. W. 1067; 
 Minn. L. Co. v. Whitebreast Co., 160 111. 85, 43 N. E. 774, 31 E. R. A. 
 529; Lima, etc., Co. v. Natl. Steel, etc., Co., 155 Fed. 77, 83 C. C A. 
 593, 11 E. R. A. (N. S.) 713. In each of these cases were promises by 
 the purchaser to be bound by the contract either by acceptance or oth- 
 erwise. 
 
 This element of consideration in the form of mutuality being wholly 
 lacking in the instant case, it is unnecessary to consider many other 
 objections urged to the validity of a contract resulting from defend- 
 ant's letter of March 10, 1905. We deem it clear that that letter at most 
 constituted a continuing offer to furnish castings upon payment of 
 the specified price, and might be revoked at any time by the defend- 
 ant, except as to orders thereunder prior to the revocation. The let- 
 ters referred to in the statement of facts of April, October, and Decem- 
 ber, 1906, are open to no construction but that of revocation of the 
 offer, except to the extent of the irons then manufactured aiid on hand, 
 so that the plaintiff could not by an order on December 27th impose 
 upon the defendant any duty to manufacture for him other castings at 
 the price named in the offer of March 10, 1905, and therefore is entitled 
 to no damages for refusal so to do. 
 
 Judgment reversed, and cause remanded, with directions to dismiss 
 the action. 
 
 CHAEEENGE WIND & FEED MILL CO. v. KERR. 
 (Supreme Court of Michigan, 1892. 93 Micli. .328, 53 N. W. 555.) 
 
 Assumpsit by the Challenge Wind & Feed Mill Company against 
 Thomas Kerr to recover the price of a windmill. Judgment for plain- 
 tiff, and def endant^brings error. Reversed. . 
 
 Long, J. The defendant gave an order to the plaintiff for a wind- 
 mill, at the price of $125. The order was in writing, signed by the de- 
 fendant, and delivered to the plaintiff's agent at Millington, this state, 
 and by the agent forwarded to the plaintiff at Batavia, 111. The order 
 was dated May 16, 1890, and contained the following clause: "This 
 order is not subject to countermand. No verbal understanding of 
 agents to affect this order, all conditions under which same is given 
 being specified herein; all orders subject to the approval of Challenge 
 Wind & Feed Mill Company." This order was forwarded to the plain- 
 
1 88 OFFER AND ACCEPTANCE (Ch. 1 
 
 tiff, and the word "Accepted" written upon it, together with the words, 
 "Will ship to-day, May 28, 189Q," and signed by the company. About 
 a week after the order was given defendant notified the company that 
 he would not accept the mill. The mill was subsequently shipped to 
 Vassar, this state. Defendant refused to receive it, and so notified the 
 plaintiff, and returned the mill to the company. The mill was reship- 
 ped to Vassar by the plaintiff, and subsequently an arrangement was 
 made between the defendant and plaintiff's agent, by which the mill 
 was to be erected upon defendant's premises under a verbal warranty 
 made by the agent. The suit was brought to recover the value of the 
 mill. On the trial plaintiff had judgment for the value. 
 
 The defense was that the mill did not comply with the warranty 
 made by the agent at the time defendant agreed to take it. Defend- 
 ant's proofs tended strongly to show that the mill did not comply 
 with the warranty, and that, though the plaintiff's agent attempted 
 upon several occasions to make it do the work intended, he was unsuc- 
 cessful. The court below, however, was of the opinion that it was im- 
 material whether or not the agent made the warranties, for the reason 
 that, under the written contract first made, the agent had no authority 
 to make a contract which would bind the plaintiff, and of which the 
 defendant had notice, and so charged the jury. This was error. The 
 written order given by the defendant to the agent, and forwarded to 
 the plaintiff, was countermanded before acceptance by the plaintiff, 
 and before the plaintiff had taken any steps whatever towards filling 
 the order. The defendant had a right during that time to counter- 
 mand it. The order Was one which the plaintiff could accept or not, 
 as it pleased. This right was expressly reserved in the order, and un- 
 til acceptance the contract was unilateral. Wilcox v. Cline, 70 Mich. 
 517, 38 N. W. 555. Up to the time of acceptance, or up to the time 
 the plaintiff had signified its intention to accept, it was not bound by 
 the order ; and during this time the defendant had the right to counter- 
 mand, as no period was fixed within which the plaintiff might accept 
 defendant's terms. This contract, therefore, was not binding between 
 the parties, and defendant was under no obligation to accept the mill 
 upon its arrival at Vassar, and plaintiff shipped it at its own risk of 
 having the mill received by the defendant. 'The defendant refused ab- 
 solutely to receive it, and it wsis reshipped. No other written order 
 was made, and the plaintiff sent the mill to its agentsat Vassar. What- 
 ever arrangement was thereafter made by its agent with the defend- 
 ant would be binding Upon , the plaintiff. What these arrangements 
 and representations made by the agent were, and whether they were 
 fulfilled, were questions of fact for the jury. The defendant had a 
 right to have his case submitted to the jury upon his theory, and, if 
 the mill did not fulfill the warranties, defendant would be under no ob- 
 ligation to keep and pay for it. 
 
 The judgment below is set aside, with costs, and a new trial ordered. 
 The other justices concurred. 
 
Sec. 9) LAPSE OP OFFER — 'POWER OP REVOCATION 189 
 
 LOS ANGELES TRACTION CO. v. WILSHIRE et al. 
 (Supreme Court of California, 1902. 135 Cal. 654, 67 Pac. 1086.) 
 
 Action by the Los Angeles Traction Company against W. B. Wil- 
 shire and others. From a judgment for plaintiff, and from an order 
 denying a new trial, defendants appeal. Affirmed. 
 
 Gray, C.^ The action is based on a written instrument signed by 
 appellants and reading as follows : "$2,000. Los Angeles, Cal, July 
 19th, 1895. Thirty days after the completion of the double track street 
 railway of the Los Angeles Traction Company to the intersection of 
 Seventh and Hoover streets, for value received, I promise to pay to 
 the order of the Los Angeles Traction Company, the sum of two thou- 
 sand (2,000) dollars, negotiable and payable at Citizens' Bank, with in- 
 terest at the rate of eight per cent, per annum, payable after maturity. 
 I further promise and agree to pay a reasonable attorney's fee if suit 
 should be instituted for the collection of this note." The above instru- 
 ment was placed in the hands of the Citizens' Bank, together with a 
 duly signed written escrow agreement as follows: 
 
 "To the Citizens' Bank, Los Angeles, Cal. : Herewith is handed you 
 by the undersigned the following named notes, to be held in escrow 
 upon the terms and conditions herein stated: You are requested to 
 hold said notes in escrow until the completion of the line of railroad 
 of the Los Angeles Traction Company, now being constructed in the 
 city of Los Angeles. * * * Upon completion and operation of the 
 same with electric power, you are instructed to deliver said notes to 
 said Los Angeles Traction Company. In case a franchise for such 
 street car line to said Hoover street is not obtained by said Ti^action 
 
 Company within months from the date hereof, then, in that event, 
 
 said notes shall be returned to their respective makers upon demand, to 
 be canceled. Said notes are made by the following named persons, 
 and in the sums set opposite their names." Then follow the names of 
 the parties giving the notes, including the names of these appellants, 
 who also signed the said agreement. 
 
 The findings show that, on the faith of the foregoing instruments 
 and other instruments of like character executed by other parties, who, 
 like defendants, were the owners of property that would be made val- 
 uable by the construction of the proposed road, the plaintiff in Novem- 
 ber, 1895, less than four months from the execution of said instru- 
 ment, bid and paid to the city of Los Angeles $1,505 for a franchise to 
 construct the road over that part of the course agreed upon and with- 
 in the city limits Before the 28th of April, 1896, the plaintiff com- 
 menced work upon said railway, but said work was not performed 
 with the intention of prosecuting the construction- of said railway con- 
 tinuously and with diligence to completion, and the plaintiff did not so 
 
 1 Parts of the opinion are omitted. 
 
190 OFFER AND AGCBPTANCE (Ch. 1 
 
 commence work upon said railway with said purpose until after the 
 1st day of July, 1897. On July 1, 1897, defeiidants served upon plain- 
 tiff a written notice to the effect that they did not recognize any liabil- 
 ity oh account of the foregoing written contracts, for the reason that 
 the road had not been completed within the time agreed upon. Soon 
 after the service of this notice the plaintiff actively engaged in the con- 
 struction of the road, and completed it, and commenced operating the 
 same to the intersection of Seventh and Hoover streets, as provided 
 for in said instruments, before the expiration of the year 1897. There- 
 after, and on May 17, 1898, plaintiff completed its railway to First and 
 Virgil streets. Upon these facts plaintiff had judgment for $2,000 be- 
 sides interest and attorney's fees. Defendants appeal from this judg- 
 ment and from an order denying them a new trial. * * * 
 
 3. The contract at the date of its making was unilateral, a rriere offer 
 that if subsequently accepted and acted upon by the other party to it 
 would ripen into a binding enforceable obligation. When the respond- 
 ent purch'ased and paid upwards of $1,500 for a franchise it had acted 
 upon the contract, and it would be manifestly unjust thereafter to per- 
 mit the offer that had been made to be withdrawn. The promised con- 
 sideration had then been partly performed, and the contract had taken 
 on a bilateral character, and if appellant thereafter thought he discov- 
 ered a ground for rescinding the contract, it was, as it always is, a nec^ 
 essary condition to the rescission that the other party should be made 
 whole as to what he had parted with on the strength of tlie contract. 
 The notice of withdrawal from the contract was ineffectual, therefore, 
 for several reasons. In the first place, it was based on a wrong theory ; 
 the reason given for it was that the road was not constructed within 
 the agreed time, when, as was determined subsequently by the court, 
 there was no time agreed upon. Again, it came too late, after the ob- 
 ligations of the parties had become fixed. * * * 
 
 Judgment affirmed.^ 
 
 2 Cases in accord are: Halff Co. v. Waugh (Tex. Civ. App.) 183 S. W. 839 
 (1916), sale of a truck to be paid for out of earnings, buyer having partly 
 performed, although not bound; Zwolanek v. Baker Mfg. Co., 150 Wis. 517, 
 137 N. W. 769, 44 L. K. A. (N. S.) 1214, Ann. Cas. 1914A, 793 (1912), see 26 
 Harv. L. Rev. 274; A. B. Dick Co. v. Fuller (D. C.) 213 Fed. 98 (1914), promise 
 to pay for invention of stencil by an employee, irrevocable vs^hen latter "began 
 work in reliance upon it"; Louisville & N. R. Co. v. Goodnight, 10 Bush 
 (Ky.) 552, 19 Am. Rep. 80 (1874); Louisville & N. R. Co. v. Ooyle, 123 Ky. 
 854, 97 S. W. 772, 99 S. W. 237, 8 L. R. A. (N. S.) 433, 124 Am. St. Rep. 384 
 (1907) ; American Publishing & Engraving Co. v. Walker, 87 Mo. App. 503 
 (1901), bilateral contract by implication; Taylor v. E wing, 74 Wash. 214, 132 
 Pac. 1009 (1913). See also the charitable subscription eases, post, 242. Con- 
 tra: Riggers v. Owen, 79 Ga. 658, 5 S. E. 193 (1887); Gray v. Hinton (C. 0.) 
 7 Fed. 81 (1881). 
 
 In Wachtel v. National Alfalfa Journal Co. (Iowa) 176 N. W. 801 (1920), 
 the defendant opened a circulation contest, offering prizes to those winning 
 the most votes by securing subscriptions, but later discontinued the contest 
 when the plaintifie was the leader therein. The plaintifE was held entitled to 
 damages for breach of contract. Other voting contest cases are: Hertz v 
 Montgomery Journal Pub. Co., 9 Ala. App. 178, 62 South. 564 (1913) ; Mooney 
 
Sec. 9) LAPSE OP OFFER — POWER OF REVOCATION 191 
 
 BRACKENBURY et al. v. HODGKIN et al. 
 (Supreme Judicial Court of Maine, 1917. 116 Me. 399, 102 Atl. 106.) 
 
 Suit by Joseph A. Brackenbury and another against Sarah D. P. 
 Hodgkin and Walter C. Hodgkin. From a decree for plaintiffs, de- 
 fendants appeal. Appeal dismissed, and decree affirmed as to Walter 
 C. Hodgkin. 
 
 Cornish, C. J. The defendant Mrs. Sarah D. P. Hodgkin on the 
 8th day of February, 1915, was the owner of certain real estate — ^her 
 home farm, situated in the outskirts of Lewiston. She was a widow 
 and was living alone. She was the mother of six adult children, five 
 sons, one of whom, Walter, is the codefendant, and one daughter, who 
 is the coplaintiff. The plaintiffs were then residing in Independence, 
 Mo. Many letters had passed between mother and daughter concern- 
 ing the daughter and her husband returning to the old home and tak- 
 ing care of the mother, and finally on February 8, 1915, the mother 
 sent a letter to the daughter and her husband which is the f&imdation 
 of this bill in equity. In this letter she made a definite proposal, the 
 substance of which was that if the Brackenburys would move to Lew- 
 iston, and maintain and care for Mrs. Hodgkin on the home place dur- 
 ing her life, and pay the moving expenses, they were to have the use 
 and income of the premises, together with the use of the household 
 
 V. Daily News Co. of Minneapolis, 116 Minn. 212, 133 X. W. 573, 87 L. R. A. 
 (N. S.) 183 (1911). 
 
 It has been sometimes asserted that an irrevocable offer is "a legal impos- 
 sibility." See Langdell, Suramary of the Law of Contracts, § 178; also sec- 
 tion 4 ; Wormser, The True Conception of Unilateral Contracts, 26 Yale L. 
 Jour. 137, note ; Lee, title Contracts, in Jenks' Dig. of Eng. Civ. Law, § 195 ; 
 Ashley, Contracts, § 13. To the contrary, see Corbln, Offer and Acceptance 
 and Some of the Resulting Legal Relations (1917) 26 Yale L. Jour. 169, 185- 
 197; McGovney, Irrevocable Offers (1914) 27 Harv. L. Rev. 644. 
 
 Sir Frederick Pollock, in 28 Law Quarterly Review, 100, reviewing Ashley 
 on Contracts, said: "Some of Prof. Ashley's positions verge on paradox, as 
 when he suggests that the doctrine of consideration may ultimately be de- 
 voured by relaxations and exceptions. One or two seem to us really para- 
 doxical, as where he maintains that in a unilateral contract, where a promise 
 is offered for an act requiring an appreciable time for performance, there is 
 no consideration for the promise and no acceptance until the act is completed. 
 If this be sOj the promisor may withdraw his offer when the work is all but 
 done, or the promisee may capriciously leave the work half done, and in 
 either case without remedy, unless there be something in the circumstances 
 which can be made to support an action of tort. A carter, for example, who 
 is carrying goods to a wharf to be put on an outgoing ship, may abandon them 
 in the middle of the journey. Both the plain man and the average lawyer 
 will say that, whatever Prof. Ashley's logic may be, the law really cannot be 
 so absurd as that; and they will be right, and, what is more, any rational 
 court before whom such a question is moved will surely find a way to make 
 them so. It might easily be held that acting on a request for an act to be 
 done for reward implies a promise to go through with the performance. At 
 all events it seems to us that the offer is irrevocably accepted by the first un- 
 equivocal commencement of the act requested. In fact it does not often hap- 
 pen that a man sets about a job without writing or uttering some kind of word 
 of acceptance. 'All right' is enough. Thus the practical outcome of Prof. 
 Ashley's ingenious exercise may be to convince us that there are fewer uni- 
 lateral contract^ in the world than we supposed." 
 
192 OFlTER AND ACCEPTANCE (Ch. 1 
 
 goods, with certain exceptions, Mrs. Hodgkin to have what rooms she 
 might need. The letter closed, by way of postscript, with the words, 
 "you to have the place when I have passed away." 
 
 Relying upon this offer, which was neither withdrawn nor modified, 
 and in acceptance thereof, the plaintiffs moved from Missouri to Maine 
 late in April, 1915, went upon the premises described and entered up- 
 on the performance of the contract. Trouble developed after a few 
 weeks, and the relations between , the parties grew most disagreeable. 
 The mother brought two suits against her son-in-law on trifling mat- 
 ters, and finally ordered the plaintiffs from the place, but they refused 
 to leave. Then on November 7, 1916, she executed and delivered to 
 her son, Walter C. Hodgkin, a deed of the premises, reserving a life 
 estate in herself. Walter, however, was not a bona fide purchaser for 
 value without notice, but took the deed with full knowledge, of the 
 agreement between the parties and for the sole purpose of evicting the 
 plaintiffs. On the very day fhe deed was executed he served a no- 
 tice to qt^t upon Mr. Brackenbury, as preliminary to an action of for- 
 cible entry and detainer which w-as brought on November, 13, 1916. 
 This bill in equity was brought by the plaintiffs to secure a reconvey- 
 ance of the farm from Walter to his mother, to restrain and enjoin 
 Walter from further prosecuting his action of forcible entry and de- 
 tainer, and to obtain an adjudication that the mother holds the legal title 
 impressed with a trust in favor of the plaintiffs in accordance with their 
 contract. 
 
 The sitting justice made an elaborate and carefully considered find- 
 ing of facts and signed a decree, sustaining the bill with costs against 
 Walter C. Hodgkin, and granting the relief prayed for. The case is 
 before the law court on the defendants' appeal from this decree. 
 
 Four main issues are raised. 
 
 1. As to the completion and existence of a valid contract.^ 
 
 A legal and binding contract is clearly proven. The offer on the 
 part of the mother was in writing, and its terms cannot successfully be 
 disputed. There was no need that it be accepted in words, nor that 
 a counter promise on the part of the plaintiffs be made. The offer 
 was the basis, not of a bilateral contract, requiring a reciprocal prom- 
 ise, a promise for a promise, but of a unilateral contract requiring an 
 act for a promise. "In the latter case the only acceptance of the offer 
 that is necessary is the performance of the act. In other words, the 
 promise becomes binding when the act is performed." 6 R. C. L,. 607. 
 This is elementary law. 
 
 The plaintiffs here accepted the offer by moving from Missouri to 
 the mothei-'s farm in Lewiston and entering upon the performance 
 of the specified acts, and they have continued performance since that 
 time so far as they have been permitted by the mother to do so. The 
 existence of a completed and valid contract is clear. * * * 
 
 Appeal dismissed. 
 
 8 Parts of the opinion, not concerning this issue, are omitted. 
 
Sec. 9) LAPSE OF OFFER — POWER OF REVOCATION 193 
 
 MacFARLANE v. BLOCK. 
 
 (Supreme Coui-t of Oregon, 1911. 59 Or. 1, 115 Pac. 1056, Ann. Cas. 1913B, 
 
 1275.) 
 
 Action by Katherine MacFarlane against M. M. Bloch. Judgment 
 for plaintiff, and defendant appeals. Affirmed. 
 
 On July 21, 1908, plaintiff found a pocketbook containing promissory 
 notes of the value of more than $1,000, payable to M. M. Bloch, this de- 
 fendant. For several days thereafter plaintiff was sick and did little or 
 nothing toward finding the owner, except to- consult the "Lost and 
 Found" columns of the daily press; and also her son phoned to 
 Bloch, the jeweler. On July 31st, defendant advertised in the Ore- 
 gonian for a "Lost — Pocketbook with papers ; please return to county 
 judge's office; reward. M. M. Bloch." ' Lnmediately thereafter plain- 
 tiff phoned to the county judge's office and asked for Bloch, and was 
 informed that there was no such person there. On August 5th, defend- , 
 ant again advertised in the Oregonian, making the following offer: 
 "Lost — Pocketbook. Return to county judge's office ; $100.00 reward. 
 M. M. Bloch." And in response thereto plaintiff went to the county 
 judge's office and saw Robert Shaw, who was Bloch's agent in this ma,t- 
 ter, and told him that she had come to get the reward, in response to 
 the advertisement for a lost pocketbook. ' When asked if she had the 
 pocketbook, she replied that she knew where it was, and offered to pro- 
 duce it for the $100 reward. She thereafter held it for the reward, 
 which defendant at no time offered to pay, but he had her arrested for 
 larceny of the book, and, in order to avoid the criminal proceedings, 
 she surrendered it to Bloch and brought this action to recover the 
 amount of the reward. The case was tried by the court without the 
 intervention of a jury, and he found the facts in favor of plaintiff and 
 from a judgment thereon defendant appeals. 
 
 Eakin, C. J.* (after stating the facts as above) . There is no liability 
 upon an offer of a reward to any one who performs some specific act 
 until the act stipulated has been performed, but the offer is to be con- 
 strued by the same rules as other contractual offers. 
 
 Counsel for defendant contends that, to entitle plaintiff to the reward 
 it must be made to appear that she found the book after the offer was 
 made, and that the finding was with a view to obtaining the reward. 
 The courts are divided as to whether knowledge of the offer, at the 
 time of the performance of the act, is essential to the right to the 
 reward, or to the enforcement of it. So far as relates to the facts in 
 this case it is immaterial which line of authorities we would be in- 
 clined to follow, as the finding of the book was not the purpose of the 
 offer. Defendant was aware that the book had been found before 
 the offer was made, and the offer was for its return to the county 
 judge's office. This condition of the offer plaintiff complied with. She 
 
 * Part of the opinion is omitted. 
 
 CORBIN CONT 13 
 
194 OFFER AND AOCEPTANCB (Ch- 1, 
 
 took tlie book and its contents to the county judge's office and offered 
 to surrender it for the payment of the reward. This was held suffi- 
 cient in Pierson v. Morch, 82 N. Y. 503, a case in many respects 
 identical with the one before us. It was contended that there was no 
 consideration for the promise, but the court held that the return of the 
 property completed the contract and the defendant was liable. . It was 
 also contended in that case that plaintiff was not the finder in good faith, 
 as she made no inquiries before leaving the car where she found the 
 goods, either of the conductor or the passengers. The court held that 
 the question was properly submitted to the jury and their decision was 
 in her favor, the court saying : "If the plaintiff really found and took 
 possession of the goods, believing them to be lost, and with a purpose to 
 preserve and return them if possible to the owner, she was in con- 
 dition to claim the reward, upon complying with its terms." In that 
 case the goods were found before the reward was offered. To the 
 same effect is Everman v. Hyman, 3 Ind. App. 459, 29 N. E. 1140, 
 in which case a reward was offered for the return of a stolen horse, and 
 it was held that the finder had a right to retain the horse until the re- 
 ward was paid. See, also, Cummings v. Gann, 52 Pa. 484 ; Grady v. 
 Crook, 2 Abb. N. C. (N. Y.) 53; Wood v. Pierson, 45 Mich. 313, 7 N. 
 W. 888. 
 
 Upon plaintiff's offer to return the book defendant's agent would not 
 pay, and, in fact, had no authority to pay, the reward. It appears from 
 the evidence and conduct of defendant that he had no intention of so 
 doing. There is nothing in the evidence tending to show an intention 
 on her part to keep or convert the property to her own use. Although 
 she knew who was the owner of the property, she had not ascertained 
 his address until after the offer of the reward of July 31st; and there- 
 after she retained the goods for the reward. 
 
 When the $100 reward was offered she had a lien thereon for the 
 payment of it. 19 A. & E. E. 583; 24 A. & E. E. 961; Wentworth 
 V. Day, 3 Mete. (Mass.) 352, 37 Am. Dec. 145 ; Everman v. Hyman, 3 
 Ind. App. 459, 29 N. E. 1140. * * * 
 
 The judgment is affirmed. 
 
 STENSGAARD v. SMITH. 
 
 (Supreme Court of Minnesota, 1890. 43 Minn. 11, 44 N. W. 669, 19 Am. St. 
 
 Rep. 205.) 
 
 Dickinson, J. This action is for the recovery of damages for breach 
 of contract. The rulings of the court below, upon the trial, were 
 based upon its conclusion that no contract was shown to have been 
 entered into between these parties. We are called upon to review the 
 case upon this point. The plaintiff was engaged in business as a real- 
 estate broker. On the 11th of December, 1886, he procured the de- 
 fendant to execute the following instrument, which was mostly in 
 
Sec. 9) LAPSE OF OFFER — POWER OF REVOCATION 195 
 
 printed form: "St. Paul, Dec. 11, 1886. In consideration, of L. T, 
 Stensgaard agreeing to act as agent for the sale of the property here- 
 inafter mentioned, I have hereby given to said L. T. Stensgaard the 
 exclusive sale, for three months from date, the following property, tp- 
 wit: [Here follows a description of the property, the terms of sale, 
 ^ and some other provisions not necessary to be stated.] I further agree 
 to pay said L. T. Stensgaard a commission of two and one-half per 
 cent, on the first $2,000, and two and one-half per cent, on the balance 
 of tlie purchase price, for his services rendered in selling of the above- 
 mentioned property, whether the title is accepted or not, and also what- 
 ever he may get or obtain for the sale of said property above $17,000 
 for such property, if the property is sold. John Smith." The evidence 
 showed that the plaintiff immediately took steps to effect a sale of the 
 land, posted notices upon it, published advertisements in newspapers, 
 and individually solicited purchasers. About a month subsequent to 
 the execution by the defendant of the above instrument, he himself 
 sold the property. This constitutes the alleged breach of contract for 
 which a recovery of damages is sought. 
 
 The court was justified in its conclusion that no contract was shown 
 to have been entered into, and hence that no cause of action was es- 
 tablished. The writing signed by the defendant did not of itself con- 
 stitute a contract between these parties. In terms indicating that the 
 instrument was intended to be at once operative, it conferred present 
 authority on the plaintiff to sell the land, and included the promise of 
 the defendant that, if the plaintiff should sell the land, he^hould re- 
 ceive the stated compensation. This alone was no contract, for there 
 was no mutuality of obligation, nor any other consideration for the 
 agreement of the defendant. The plaintiff did not by this instrument 
 obligate himself to do anything, and therefore the other party was not 
 bound. Bailey v. Austrian, 19 Minn. 535, (Gil. 465 ;) Tarbox v. Got- 
 zian, 20 Minn. 139, (Gil. 122.) If, acting under the authority thus con- 
 ferred, the plaintiff had, before its revocation, sold the land, such per- 
 formance would have completed a contract, and the plaintiff would 
 have earned the compensation promised by the defendant for such 
 performance. Andreas v. Holcombe, 22 Minn. 339; Ellsworth v. Ex- 
 tension Co., 31 Minn. 543, 18 N. W. 822. But so long as this remain- 
 ed a mere present authorization to sell, without contract obligations 
 having been fixed, it was revocable by the defendant. The instrument 
 does, it is true, commence with the words : ■ "In consideration of L. T. 
 Stensgaard agreeing to act as agent for the sale of the property," etc. ; 
 but no such agreement on the part of the plaintiff was shown on the 
 trial to have been actually made, although it was incumbent upon him 
 to establish the existence of a contract as the basis of his action. This 
 instrument does not contain an agreement on the part of the plaintiff, 
 for he is no party to its execution. It expresses no promise or agree- 
 ment except that of the defendant. It may be added that the language 
 
] 96 OFFER AND ACCEPTANCE (Ch. 1 
 
 fact of an agreement having been already made on the part of the 
 plaintiff. Of course, no consideration was necessary to support the 
 present, but revocable, authorization to sell. It is difficult to give any 
 practical effect to this clause, in the construction of the instrument. It 
 seems probable, in the absence of proof of such an agreement, that this 
 clause had no reference to any actual agreement between those parties, 
 but was a part of the printed matter which the plaintiff had prepared 
 for use in his business, with the intention of making it effectual by his 
 own signature. If he had appended to this instrument his agreement 
 to accept tlie agency, or even if he had signed this instrument, this 
 clause would have had an obvious meaning. 
 
 This instrument, executed only by the defendant, was effectual, as 
 we hive said, as a present, but revocable, grant of authority to sell. It 
 involved, moreover, an offer on the part of the defendant to contract 
 with the plaintiff that the latter should have, for the period of three 
 months, the exclusive right to sell the land. This action is based upon 
 the theory that such a contract was entered into; but, to constitute 
 such a contract, it was necessary that the plaintiff should in some wiay 
 signify his acceptance of the offer, so as to place himself under the re- 
 ciprocal obligation to exert himself during the whole period named to 
 effect a sale. No express agreement was shown. The mere receiving 
 and retaining this instrument did not import an agreement thus to act 
 for the period named, for the reason that, whether the plaintiff should 
 be willing to take upon him that obligation or not, he might accept and 
 act upon the revocable authority to sell expressed in the writing ; and, 
 if he should succeed in effecting a sale before the power should be re- 
 voked, he would earn the commission specified. In other words, the 
 instrument was presently effectual, and of advantage to him, whether 
 he chose to place himself under contract obligations or not. For the 
 same reason the fact that for a day or a month he availed himself of 
 the right to Sell conferred by the defendant, by attempting to make a 
 sale, does not justify the inference, in an action where the" burden is on 
 the plaintiff to prove a contract, that he had accepted the offer of the 
 defendant to conclude a contract covering the period of three montlis, 
 so that he could not have discontinued his efforts without rendering 
 himself liable in damages. In brief, it was in the power of the plain- 
 tiff either to convert the defendant's offer and authorization into a com- 
 plete contract, or to act upon it as a naked revocable power, or to do 
 nothing at all. He appears to have simply availed himself for about a 
 month of the naked present right to sell, if he could do so. He cannot 
 now complain that the land-owner then revoked the authority, which 
 was still unexecuted. It may be added that there was no attempt at the 
 trial to show that the plaintiff notified the defendant that he was en-, 
 deavoring to sell the land ; and there is but little, if any, ground for an 
 inference from the evidence that the defendant in fact knew it. The 
 caseMS distinguishable from those where, under a unilateral promise, 
 there has been a performance by the other party of services, or other 
 
Sec. 9) LAPSE OP OPPER — POWER OP REVOCATION 197 
 
 thing to be done, for which, by the terms of the promise compensation 
 was to be made. Such was the case of Goward v. Waters, 98 Mass. 
 596, rehed upon by the appellant as being strictly analogous to this case. 
 In the case before us, compensation was to be paid only in case of a 
 sale of the land by the plaintiff. He can recover nothing for what he 
 did, unless there was a complete contract ; in which case, of course, he 
 might have recovered damages for its breach. 
 Order affirmed/ 
 
 BRANIFF et al. v. BAIER et al. 
 
 (Supreme Court of Kansas, 1917. 101 Kan. 117, 165 Pac. 816, L. E. A. 1917E, 
 
 1036.) 
 
 Action by T. J. Braniff and others against Henry F. Baier and an- 
 other. Judgment for plaintiffs, and defendants appeal. Affirmed. 
 
 Johnston, C. J.° This was an action by T. J. Braniff, G. E. Holm- 
 berg, and A. Lynn against Henry F. Baier and Charles A. Baier to 
 recover an agent's commission for procuring a purchaser for defend- 
 ant's real estate. Holmberg and Lynn are the assignees of ,C. W- Tal- 
 madge's interest in the commission claimed, who was associated with 
 Braniff in the transaction. Plaintiffs were awarded judgment in the 
 sum of $702, and the defendants appeal. 
 
 Defendants engaged the services of Braniff and Talmadge on July 
 1, 1913 and signed the following memorandum : 
 
 "We, the undersigned, H. F. Baier and C. A. Baier, do hereby ap- 
 point and constitute C. W. Talmadge and T. J. Braniff, or either of 
 them, as our only agents to sell our forty acres of farm land in Fells- 
 mere, Florida, known as tracts No. 1232, 1233, 1260 and 1261 in town- 
 ship 31, range 37, in St. Lucie county, Florida; and we also agree to 
 accept from the above-named agents or either of them, the actual cash 
 we have already paid on the above-mentioned contracts, plus $50.00 
 plus $8.00 for transferring contracts, as full payment to us for our in- 
 terest in the above-named lands; the purchaser to assume all future 
 payments. The above-named contract to remain good until October 1, 
 1913. Dated July 1, 1913." 
 
 6 In this case (as well as in others) the student should distinguish clearly 
 between the agent's legal power and his factual ability to use it by finding a 
 buyer. The legal power can be conferred upon any sluggard, but only a 
 hustler will earn the commission. Between the agent and his principal the fol- 
 lowing jural relations may exist: The agent may have a power to create a 
 right to a commission, a power to create contract relations between the prin- 
 cip'al and a third person, a right that the principal shall not revoke his pow- 
 ers, an imniunity from such revocation by the principal, a duty to use dili- 
 gence in finding a buyer. The necessary correlatives of these, existing in the 
 principal, are: A liability to a duty to pay commission, a liability to contract 
 with a third person, a duty not to revoke, a disability to revoke, a right that 
 the agent shall be diligent. On the other hand, the principal may have the 
 privilege of revoking, or he may have the power of revoking without the priv- 
 ilege. As the operative facts vary, so also will the resulting legal relations. 
 
 6 Parts of the opinion are omitted. 
 
198 OFFER AND. ACCEPTANCE (Ch. 1 
 
 After this appointment was made, the agents acted upon the au- 
 thority by advertising the land, interviewing parties, and writing let- 
 ters, and they spent considerable time an^ effort to find a purchaser. As 
 a result of correspondence begun about August 1, 1913, George W. 
 Auber of Fellsmere, Fla., on August 25th agreed to buy the land, and he 
 sent the following letter inclosing payment : 
 
 "Farmers' National' Bank,. Salina, Kansas: Inclosed you will find a 
 check for $950.00 in favor of Henry and Charles Baier for their in- 
 terest in tracts south range 37, east of the Fellsmere Farms, Fla., of 
 land No. 1232, 1233, 1260 and 1261, township 31, said check to be given 
 to said Henry and Chas. Baier when contracts or certificates of pur- 
 chase have been properly transferred and Signed by them in favor of 
 me, George W. Auber. You will also find inclosed a check for $750 
 in favor of C. W. Talmadge and T. J. Braniff when said contracts 
 are properly transferred to me and mailed and registered to my ad- 
 dress, being Fellsmere, Florida." 
 
 About 10 days before the Auber letter was written, the defend- 
 ants told Braniff that they did not desire to sell the land, and on Au- 
 gust 26th thdy wrote a letter stating that the land was withdrawn from 
 sale and the authority of the agents revoked as of the date of the oral 
 notice. Wh^h defendants were informed by the agents that a pur- 
 chaser had been found in accordance with the terms of their contract, 
 defendants replied that the lands were no longer for sale and that the 
 money sent would not be accepted. The jury found, in effect, that the 
 agents had found a purchaser and had complied with the terms of the 
 written contract, and that the only reasons given by defendants for not 
 complying with the contract was that the land had been withdrawn 
 from sale and that they did not care to sell it at that time. 
 
 Defendants contend that the contract of agency was unilateral and 
 subject to revocation at any time before a purchaser was produced. 
 The employment or agency, it will be observed, was exclusive and for 
 a fixed time. It is true, as defendants contend, that, when the promise 
 of one party is the consideration for the promise of another, they 
 must be obligatory upon both parties at the same time or they will not 
 bind. The appointment or promise of defendants was unilateral when 
 made; but, when it was accepted by the agents and they had spent 
 time, effort, and money in carrying out its provisions, there was there- 
 after no lack of consideration. When the agents accepted the proposal 
 and proceeded to perform the services which the appointment con- 
 templated were to be performed by them, it became a mutual and bind- 
 ing obligation. As soon as the promises of the parties ripened into a 
 contract, Braniff and Talmadge became the sole agents for the sale 
 of the defendants' land with the exclusive right to sell it, until October 
 1, 1913. The defendants could not thereafter, by withdrawing the 
 land from sale or by an attempted revocation, set aside the contract 
 nor escape responsibility for the violation of its conditions. [Several 
 cases were here discussed.] 
 
Sec. 9) LAPSE OF OFFER'— POWER OF REVOCATION 199 
 
 Stensgaard v. Smith, 43 Minn. 11, 44 N. W. 669, 19 Am. St. Rep. 
 205, is out of line, witH. the cited cases, in this, that it appears to hold 
 that the posting, advertising of property, and the iniiividual soliciting of 
 purchasers did not constitute an acceptance or convert a proposal into 
 a- binding contract. That court, in the later case of Lapham v. Flint, 
 86 Minn. 376, 90 N. W. 780, stated that the only question before the 
 court in the Stensgaard Case .was whether the contract upon its face, 
 unaided by evidence or allegations in the complaint, expressed a mu- 
 tuality of obligation, and it was held that it did not, because there was 
 nothing in the contract itself to indicate an acceptance of the obliga- 
 tion either in writing or by performance. 
 
 The general trend of authorities is that, if the agent proceeds in good 
 faith to comply with the terms of the proposal or agreement like the 
 one in question by advertising the property and spending time and 
 effort to find a purchaser, these acts amount to an acceptance, and 
 
 thereafter both parties are hound. Note, 19 L. R. A. (N. S.) 
 
 -on * * * 
 
 No material error being found in the record, the judgment is af- 
 firmed. All the Justices concurring.'' 
 
 1 Where the broker has perrormed substantial acts toward earning his com- 
 missions, he can generally maintain suit in case of revocation by the owner. 
 He recovers either the agreed commission, on the theory that the owner was 
 wholly disabled to revoke ; or he recovers the profits that he would have 
 made, on the theory that the owner has the power of revocation, but not the 
 privilege. It is of ten, assumed that the contract is bilateral, the broker having 
 made some sort of a promise by implication. See Blumenthal v. Bridges, 91 
 Ark. 212, 120 S. W. 974, 24 L. B. A. (N. S.) 279 (1909) ; Kimmell v. Skelly, 130 
 Cal. 555, 62 Pac. 1067 (1900) ; Sill v. Ceschi, 167 Cal. 698, 140 Pac. 949 (1914), 
 semble ; Paulsen v. Kourke, 26 Colo. App. 488, 145 Pac. 711 (1915) ; Attix 
 V. Pelan, 5 Iowa, 336 (1857) ; Knudson & Richardson v. Iiaurent, 150 Iowa, 
 189, 140 N. W. 392 (1913) ; Goward v. Waters, 98 Mass. 596 (1868) ; Axe v. 
 Tolbert, 179 Mich. 556, 146 N. W. 418 (1914) ; Lapham v. Flint, 86 Minn. 376, 
 90 N. W. 780 (1902) ; Sunflower Bank v. Pitts, 108 Miss. 380, 66 South. 810 
 (1914) ; Mercantile Trust Co. v. Lamar, 148 Mo. App. 353, 128 S. W. 20 (1910) ; 
 Kruse v. Ferber, 91 N. J. Law, 470, 103 Atl. 409 (1918) ; Cloe v. Rogers, 31 Okl. 
 255, 121 Pac. 201, 38 L. R. A. (N. S.) 366, and note (1912), owner has power to 
 revoke, but not the privilege ; Sehoenmann v. Whitt, 135 Wis. 332, 117 N. W. 
 851, 19 L. R. A. (N. S.) 598, and note (1908), revocation before any substantial 
 action by the broker; Alexander v. Sherwood Co., 72 W. Va. 195, 77 S. E. 
 1027, 49 L. R. A. (N. S.) 985, note (1913). 
 
200 OFFEK AND ACCEPTANCE (Ch. 1' 
 
 McMillan v. ames.« 
 
 (Supreme Court of Minnesota^ 1885. 33 Minn. 257, 22 N. W. 612.) 
 
 Vanderburgh, J. On the day it bears date the defendant executed 
 and delivered to James McMillan & Co. the following covenant or 
 agreement under seal which wjas subsequently assigned to the plaintiff : 
 
 "Exhibit A. 
 
 "I, E. B. Ames, of Minneapolis, Minnesota, for the consideration, 
 hereinafter mentioned, do hereby promise and agree to grant, bargain, 
 sell and convey by good and lawful warranty deed, unto James Mc- 
 Millan & Co., their heirs and assigns, in fee-simple, free from all in- 
 cumbrances, at any time between the date of this instrument and the 
 third day of August, 1884, that the said James McMillan & Co. may 
 elect, that certain real estate situate in the county of Hennepin and 
 state of Minnesota, and described as follows, to-wit, a part of lots ninfe' 
 (9) and ten, (10,) in block twenty, (20,) in the town of MinneapoKs, be- 
 ing a tract of land twenty-seven (27) feet wide, fronting on First ave- 
 nue south, and extending back ninety-nine (99) feet, together with the 
 two-story brick and stone building standing thereon, together with all 
 the appurtenances thereunto belonging. 
 
 "The consideration above rnentioned and referred to is the payment 
 to me, by the said James McMillan & Co., of the stim of thirty-five 
 hundred dollars, and the further payment of the taxes duly assessed 
 upon said real estate between the second day of August, 1879, and the 
 date of the execution and delivery of said deed. Said payments to be 
 made at the time of the execution and delivery of said deed, unless oth- 
 erwise agreed to by said James McMillan & Co. and myself. 
 
 "It is hereby' expressly understood and agreed that in case of a vio- 
 lation of the lease under, which the said James McMillan & Co. now 
 hold said real estate, I am to be released from any and all promises 
 contained and by me made in this instrument, 
 
 "Witness my hand this sixth day of October, 1879, the same being 
 the date of this instrument. E. B. Ames. [Seal.]" 
 
 By the terms of this instriiment, which is admitted to have been seal- 
 ed by defendant, he covenanted to convey the premises upon the con- 
 sideration and condition of the payment by the covenantees of the sum 
 named, on or before the date fixed in the writing. Before performance 
 on their part, the defendant notified them of his withdrawal and re- 
 scission of the promise and obligation embraced in such written instru- 
 ment, and thereafter refused the tender of payment and offer of per- 
 formance by the plaintiff in conformity therewith, as alleged in the 
 complaint, and within the time limited. On the trial, it appearing that 
 
 8 This case should be again consirtered in studying Contracts under Seal, 
 post, p. 471. 
 
Sec. 9) LAPSE OF OFFE'R^-POWEE OP REVOCATION 201 
 
 such notice oi rescissipji had been given, the court rejected plaintiff's 
 offer to introduce the writing in evidence, and dismissed the action. 
 
 The only question presented on this« appeal is whether plaintiff's 
 promise 'or obligation was nudum pactum and presumptively invalid 
 for want of a consideration, or whether, being in the nature of a cove- 
 nant, the defendant was bound thereby, subject to: the performance of 
 the conditions by the covenantees. Apart from the effect of the seal as 
 evidencing a consideration binding the defendant to hold open his prop- 
 osition, or rather validating his promise subject to the conditions ex- 
 pressed in the writing, it is cl^ar that such promise, made for a consid- 
 eration thereafter to be performed by the plaintiff at his election, would 
 take eft"ect as an offer or proposition merely, but would become bind- 
 ing as a promise as soon as accepted by the performance of the con- 
 sideration, unless previously revoked or it had otherwise ceased to ex- 
 ist. Langdell, Summary Cont. § 70; Boston & M. R. R. v. Bartlett, 
 3 Cush. (Mass.) 227, 228. In the case cited there was a proposition to 
 sell land by writing not under seal. The court held the party at liberty 
 to withdraw his offer at any time before acceptance, but not after, 
 within the appointed time, because until acceptance it was a mere offer, 
 without a consideration or a corresponding promise to support it, and 
 •the court say: "Whether wisely or not, the common law unyieldingly 
 insists upon, a consideration, or a paper with a seal attached." If, 
 however, his promise is binding iipon the defendant, because contained 
 in an instrument under seal, then it is not a mere offer, but a valid 
 promise to convey the land upon the condition of payment. All that 
 remained was performance by plaintiff within the time specified to en- 
 title him to a fulfillment of the covenant to convey. Langdell, Sum- 
 mary, §§ 178, 179, (vol. 2, Cases on Contract.) As respects the validi- 
 ty or obligation of such unilateral contracts, the distinction between 
 covenants and simple contracts is well defined and established. Anson, 
 Cont. *12; Chit. Cont. *5; Leake, Cont. 146; 1 Smith, Lead. Cas. 
 (7th Ed.) 698; Wing v. Chase, 35 Me. 260; Willard v. Tayloe, 8 
 Wall. 564, 19 L. Ed. 501. 
 
 In Pitman v. Woodbury, 3 Exch. 11„ Parke, B., says: "The cases 
 establish that- a covenantee in an ordinary indenture, who is a party to 
 it, may sue the covenantor, who executed it, though he himself never 
 did; for he is a party, though he did not execute, and it makes no dif- 
 ference that the covenants of the defendant therein are stated to be in 
 consideration of those of the covenantee. Of this there is no doubt, 
 nor that a covenant binds without consideration." Morgan v. Pike, 
 14 C. B. 484; Leake, Cont. 141. The covenantee in such cases may 
 have the benefit of the contract, but subject to the conditions and pro- 
 visos in the deed. These obligations frequently take the form of 
 bonds, which is only another method of forming a contract, in which 
 a party binds hiniself as if he had made a contract to perform ; a con- 
 sideration being necessarily implied from the solemnity of the instru- 
 ment. The consideration of a sealed instrument may be inquired into ; 
 
202 OFFEK AND ACCEPTANCE (Ch. 1 
 
 it may be shown not to have been paid, (Bowen v. Bell, 20 Johns [N. 
 Y.] 338, 11 Am. Dec. 286) or to be different from that expressed, — ^Jor-^ 
 dan V. White, 20 Minn. 99, (Gil. 77) ; McCrea v. Purmort, 16 Wend. (N. 
 Y.) 460, 30 Am. Dec. 103, — or as to a mortgage that there is no debt' 
 to secure, (Wearse v. Peirce, 24 Pick. [Mass.] 144,) etc.; but, except 
 for fraud or illegality, the consideration implied from the seal cannot 
 be impeached for the purpose of invalidating the instrument or de- 
 stroying its character as a specialty. It is true that equity vi^ill not lend 
 its auxiliary remedies to aid in the enforcement of a contract which is 
 inequitable, or is not supported by a substantial consideration, but at 
 the same time it will not on such grounds interfere to set it aside. But 
 no reason appears why equity might not have decreed specific perform- 
 ance in this case, (had the land not been sold,) because the subsfantial 
 and meritorious consideration required by the court in such cases 
 would consist in that stipulated in the instrument as the condition of 
 a conveyance, performance of which by the plaintiff would have been 
 exacted as a- prerequisite to relief, so as to secure to defendant mutu- 
 ality in the remedy, and all his rights under the contract. The inquiry 
 would not, in such case, be directed to the constructive consideration 
 evidenced by the seal, for a mere nominal consideration would have 
 supported defendant's offer or promise upon the prescribed conditions.' 
 Leake, Cont. 17, 18; Railroad v. Babcock, 6 Mete. (Mass.) 353; Yard 
 v. Patton, 13 Pa. 285; Candor's Appeal, 27 Pa. 119. 
 
 If, then, defendant's promise was irrevocable within the time limited, 
 plaintiff might certainly seek his rem.edy for damages, upon the facts 
 alleged in the pleadings, upon showing performance or tender thereof 
 on his part. There is a growing tendency to abrogate the distinction 
 between sealed and unsealed instruments; in some states by legisla- 
 tion, in others to a limited extent by usage or judicial recognition.' 
 State V. Young, 23 Minn. 557 ; 1 Pars. Cont. *429. But the signifi- 
 cance of the seal as importing a consideration is everywhere still rec- 
 ognized, except as affected by legislation on the subject. It has cer-' 
 tainly never been questioned by this court. 
 
 In Pennsylvania the courts allow a party, as an equitable defense in 
 actions upon sealed instruments, to show a failure to receive the con- 
 sideration contracted for, where an actual valuable consideration was 
 intended to pass, and furnished the motive for entering into the con- 
 tract. Candor's Appeal, 27 Pa. 119; Yard v. Patton, supra. But 
 whatever the rule as to equitable defenses and counter-claims under 
 our system of practice may be held to be in the case of sealed instru- 
 ments, it has no application, we think, to a case like this, where full 
 effect must be given to the seal. Under the civil law the rule is that a 
 party making an offer, and granting time to another in which to accept 
 it, is not at liberty to withdraw it within the appointed time, it being 
 deemed inequitable to disappoint expectations raised by such offer, 
 and leave the party without remedy. The common law, as we have 
 seen, though requiring a consideration, is satisfied with the evidence 
 
Sec. 9) LAPSE OF OFFER — POWER OP REVOCATION 203 
 
 thereof signified by a seal. Boston & M. R. R. v. Bartlett,- supra. -The 
 same principle applies to a release under seal, which is conclusive 
 though disclosing on its face a consideration otherwise insufficient. 
 Staples V. Wellington, 62 Me. 9; Wing v. Chase, 35 Me. 260. 
 
 These considerations are decisive of the case, and the order denying 
 a new trial must be reversed." 
 
 ' HOB AN v. HUDSON. 
 
 (Supreme Court of Minnesota, 1915. 129 Minn. 335, 152 N. W. 723, L. H. A. 
 
 1916B, 1114.) 
 
 Holt, J.^" June. 7, 1910, plaintiff bought^ from Minnesota-Arizona 
 Copper Company 4,166 shares of its capital stock for $2,500. In the 
 deal he obtained from the company a contract by which he could ex- 
 change these shares for certain other shares in another corporation, 
 but if he did not choose to exercise this privilege on or before April 
 1, 1912, he could avail himself of this provision : 
 
 "It is hereby further agreed that the undersigned will refund to the 
 said Hoban the said sum of twenty-five hundred (2500.00) dollars on 
 June 8, 1912, on the return of said stock of the Minnesota-Arizona 
 Copper Co., properly assigned : Provided, however that the said Hoban 
 
 9 The term "option" is used to include a variety of cases, many of which 
 may also be properly described as "contracts." In each case the operative 
 facts must be determined and the particular jural relations consequent there- 
 on must be identified and isolated. Every option, like every offer, includes a 
 power in the holder of the option. Accompanying this power, there may be 
 a right that it shall not be revoked or an utter immunity from such revoca- 
 tion. 
 
 If an option is granted for a consideration or under seal, a notice of revo- 
 cation is quite inoperative, and any purchaser with notice takes subject to the 
 power of the option holder. See Smith v. Bangham, 156 Cal. 359, 104 Pac. 689, 
 28 L. R. A. (N. S.) 622 (1909) ; Thomason v. Bescher, 176 N. O. 622, 97 S. B. 
 654, 2 A. L. K. 626 (1918); O'Brien v. Boland, 166 Mass. 481, 44 N. B. 602 
 (1896) ; Parker v. Beach, 176 Cal. 172, 167 Pac. 871 (1917) ; option to retiirn 
 property if dissatisfied ; Olympia Bottling Works v. ,01ympia Brewing Co., 
 56 Or. 87, 107 Pac. 969 (1910), exclusive agency to sell beer, with option fpr 
 5-year extension; Foulkes v. Sengstacken, 83 Or. 118, 163 Pac. 311 (1917), 
 death does not terminate ivower ; Dawley v. Potter, 19 R. I. 372, 36 Atl; "92 
 (1896), option to stell a colt, if sound at 5 months; Prior v. Hilton & Dodge 
 Lumber Co., 141 Ga. 117, 80 S. E. 559 (1913). For options in leases, see Wll- 
 lard V. Tayloe, 8 Wall. 564, 19 L. Ed. 501 (1869) ; Tebeau v. Ridge, 261 Mo. 
 547, 170 S. W. 871, L. R. A. 1915C, 367 (1914); McCormick v. Stephany,- 61 
 N. J. Eq. 208, 48 Atl. 25 (1900) ; Spitzll v. Guth, 112 Misc. Rep. 630, 183 N. Y. 
 Supp. 743 (1920), option irrevocable after improvements made in reliance. If 
 there is neither a seal nor a consideration the option is revocable. Texas Co. 
 V. Dunn (Tex. Civ. App.) 219 S. W. 300 (1920); Threlkeld v. Inglett, 289 111. 
 90, 124 N. E. 368 (1919). Sometimes a sealed option, without consideration, is 
 held revocable in equity. Corbett v. Oronkhite, 239 111. 9, 87 N. E. 874 (1909). 
 The irrevocable power in an option is assignable. Himrod Furnace Co. '' v. 
 Cleveland & M. R. Co., 22 Ohio St. 451 (1872). A contract may create an op- 
 tion in each of the two parties. Saraceno v. Carrano, 92 Conn. 563, 103 Atl. 
 631 (1918) ; 28 Yale D. Jour. 65. 
 
 See, further, cases on Consideration dealing with Mutuality, post, 292. 
 !• Parts- of the opinion are omitted. 
 
204 OFFEE AND ACCEPTANCE (Ch. 1 
 
 shall first give written notice to the undersigned of his election to ac- 
 cept said refund on or before April 8, 1912 ; and time is the essence of 
 this agreement." 
 
 The company executed the agreement by its first vice president, 
 Martin E. Tew, and its secretary. Thereto was subjoined this guar- 
 anty, signed by the defendant : "For value received I hereby guar- , 
 antee the performance of the above contract." The action is upon 
 this guaranty. Plaintiff alleged that notice of election to demand a 
 refund of the $2,500 was duly given to the company, and to defendant, 
 on or about April 6, 1912, and prior to April 8, 1912. The defendant 
 expressly denied that the notice was given to the company within the 
 time provided in the contract. The court made findings, upon stipu- 
 lated facts, to the effect that the notice was npt served in time upon the 
 company, and hence tliere was no liability on the part of the guarantor. 
 Prom the order denying a new trial plaintiff appeals. 
 
 Defendant's liability was secondary only; hence plaintiff was re- 
 quired to establish a breach by the copper company of its contract with 
 him before recovery could be asked against defendant upon his guar- 
 anty. A prerequisite to showing a breach, in failing to refund the $2,- 
 500, was proof that plaintiff served upon the company, on or before 
 April 8, 1912, a written notice of an election to demand and receive 
 said refund. Notice to the guarantor of such election was not required, 
 nor could such notice served on him dispense with service upon the 
 company. The appellant rightly states that the sole issue is : 
 
 "Was the notice given through the mail by the plaintiff to the Min- 
 nesota-Arizona Copper Company on the 6th day of April, 1912, a suf- 
 ficient and substantial compliance with the terms" of the contract? 
 
 It is conceded that the notice served did not actually reach the com- 
 pany, or any of its officers, earlier than April 10, 1912. 
 
 These are the facts upon which plaintiff predicates the claim of 
 timely service: When plaintiff purchased the ■ shares the certificate,, 
 together with this contract and guaranty, bearing date June 7, 1910, 
 was mailed from Willmar, Minn., inclosed in a letter dated June 8, 
 1910, signed by Martin E. Tew, the first vice president of the company. 
 The letter head indicated that the operating office of the company was 
 in Arizona and its financial office at Willmar, Minn. "The names of the 
 directors and officers of the corporation were also given, and in such 
 manner that the inference was that Mr. Tew and the secretary resided 
 at Willmar. No attempt was made by plaintiff Until April 6, 1912, to 
 ascertain the whereabouts of any officer of the company. On that day 
 he was informed by defendant where such officers were to be found in 
 California. Thereupon plaintiff mailed at Benson, Minn., the place 
 of his residence, three notices of his election to ask a refund of the 
 $2,500. One of these notices was addressed to Martin E. Tew at Los 
 Angeles, Cal., and reached Mr. Tew on April 10, 1912. One was ad- 
 dressed to him at Tucson, Ariz.; it was not delivered but returned 
 through the dead letter office to the sender. The third was addressed 
 
Sec. 9) LAPSE OF OFFER — POWER OF REVOCATION 305 
 
 to Mr. Tew at Willmar, which place it reached on the 7th ; it was for- 
 warded to Los Angeles, Cal., reaching the addressee on April 11, 1912. 
 
 One of appellant's contentions is that by their course of dealings 
 the parties selected the mail as the proper medium by which to serve 
 notice. This is based on the fact that the company made use of the 
 mail in sending the contract and certificate of stock to plaintiff some 
 two years before. We cannot assent to the. proposition that either 
 this circumstance, or the fact that the office and officers of the company 
 had in the meantime vanished from the state, authorizes an inference 
 that the company consented to be served by depositing the notice in the 
 United States mail. No doubt, in the absence of anything to the con- 
 trary in the contract, the mail could be used as the medium of service, 
 but, if it be used, the service is not made until the notice is in the 
 hands of the one intended to be served. 
 
 Neither do we think that there is anything in the situation, or the 
 contract, which would warrant the court in saying that the company, 
 or its officers, could not withdraw from the state without notifying 
 plaintiff. There is no pretense that leaving this state was to evade 
 service, or was with any intent to deceive plaintiff. * * * 
 
 Under this contract plaintiff had the option to demand a return to 
 him of $2,500, provided he seasonably gave written notice of his elec- 
 tion to exercise the option. The contract expressly makes time the 
 essence of the agreement. The giving of the notice was a condition 
 precedent to the right to a refund. No facts were pleaded giving the 
 court any right to abrogate the clear language of the contract. Steele 
 V. Bond, 32 Minn. 14, 18 N. W. 830; Bohn Mfg. Co. v. Lewis, 45 Minn. 
 164, 47 N. W. 652 ; Alworth v. Gordon, 81 Minn. 445, 84 N. W. 454; 
 Robinson v. Northwestern Nat. Ins. Co., 92 Minn. 3.79, 100 N. W. 
 226 — make clear that in a case of this kind, where either a right to 
 money or property or a forfeiture thereof depends upon the giving of a 
 written notice, such notice, in the absence of custom, statute, estoppel, 
 or express contract stipulation, means a personal notice to the proper 
 party within the stipulated time, and that if it is sought to make use of 
 the United States mail as a means of service the service is not effected 
 until the notice comes into the hands of the one to be served. * * * 
 
 Order affirmed. ^^ 
 
 iiCompare cases ante, dealing with notice of acceptance by mail. Compare 
 also Shubert Theatrical Co. v. Bath (C. 0. A.) 271 Fed. 827 (1921). 
 
206 CONSIDERATION (Ch. 2, 
 
 CHAPTER II 
 CONSIDERATION 
 
 SECTION 1.— EARLY DEVELOPMENT 
 
 (Debt and Assumpsit — Benefit to Promisor and Detriment to 
 
 Promisee) 
 
 "Consideration is the material cause of a contract, without which 
 no contract can bind the party. This consideration is either expressed, 
 as when. a man bargains to give 20s. for a horse; or is implied, as when 
 the law itself enforces a consideration." Termes de la ley. 
 
 "Contract is a bargain or covenant between two parties, where one 
 thing is given for another, which is called quid pro quo ; as if I sell my 
 horse for money, or if I covenant to make you a lease of niy manor of 
 bale in consideration of i20 that you shall give me; these are good 
 contracts because there is one thing for another. But if a man make 
 a promise to me that I shall have 20s. and that he will be debtor to me 
 thereof, and after I ask the 20s. and he will not deliver it, yet I shall 
 never have any action to recover the 20s. because this promise was 
 no contract but a bare promise: and Ex nudo pacto non oritur actio. 
 But if anything were given for the 20s., though it were but to the 
 value of a penny, then it had been a good contract." ' Termes de la 
 ley. ^ ' ' ■ 
 
 ■ In Calthorpe's Case, 2 Dyer, 336 b, 34 (1574), it was said: "A con- 
 sideration is a cause or meritorious occasion, requiring a mutual rec- 
 ompense, in fact or in law. Contracts and bargains have a quid pro 
 quo." 
 
 No single definition that has been given serves to explain all the 
 currently 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 re- 
 garded as the equivalent of and in exchange for the promise; and 
 (3) to subsequent facts consisting of acts in reliance 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 prob- 
 lem then becomes one of determining what facts must accompany 
 promissory words in order to create a legal duty (and other legal re- 
 lations). , We must know what these facts are in order that we can 
 properly predict the enforcement of reparation, either specific or 
 
Seel) EARLY DEVELOPMENT 2Q7 
 
 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 h. Jour. 362, 376. 
 
 ANONYMOUS. 
 (In the King's Bench. Y. B. 12 Hen. VIII, 11. 3.) 
 
 In the King's Bench, the plaintiff brought an action on the case 
 against two executors of one J. S. The count was that J. N. came 
 to the house of the plaintiff to buy goods, and the said J. S., the testa- 
 tor, came with him, .and when the said J. N. wished to have the goods, 
 the plaintiff said to him that he was doubtful about giving him credit, 
 and the said J. S., the testator, said to him, "If he does not pay you, 
 I will pay you ;" upon which promise the plaintiff delivered the goods 
 to the said J. N. I^ater, J. N. died without paying the plaintiff, and 
 J. S. also died. The plaintiff alleges that the latter left assets to his 
 executors to pay all debts and legacies, and to satisfy them also. The 
 question was whether or not this action lay against the executors. And 
 it was adjudged by all the justices that he recover in this action, for 
 two reasons : One, that he had no other remedy at common law than 
 this action ; the other, because the plaintiff had delivered the goods up- 
 on the promise of the testator and there is no reason that his soul should 
 be in jeopardy and that he should suffer prejudice by his promise when 
 there was sufficient with which to pay the plaintiff. Arid so judgment 
 was given. And 
 
 FiNEux, C. J., said that this is not one of the cases where Actio 
 moritur cum persona, for that is where the hurt or damage is cor- 
 poreal ; as where one beats me and then dies, my action is gone ; or 
 in case I die, my executors have no action, for the party cannot be 
 punished when he is dead. But in this case the' plaintiff can have 
 that which he would have if the other party were alive, viz. the price 
 of his goods, and so this action does not die, for each party can have 
 his remedy ; but it is not so in case of a battery, because the writ ■ 
 cannot say that the executors beat him and they are not held respon- 
 sible in this action. Quaere whether or not the testator could wage his 
 law in' this case, if he were alive and this action were brought against 
 him.^ 
 
 1 Fourteen years later the court again held in an exactly similar case that 
 an action on the case would lie, although debt would not. Y. B. 27 Hen. 
 VIII, 24, 3. See Barbour, 4 Oxford Studies in Social and Legal History, 41. 
 
 On the point that the action survived against the executors, this case was 
 strongly disapproved by Fitzherbert fifteen years later. He declares that 
 Fineux and Conesby so held without any authority to support them and 
 "solely upon their own opinions." He adds, "Put this case out of your books, 
 for without any doubt it is not law." T. B. 27 Hen. VIII, 23, 21. 
 
208 CONSIDEBATION (Ch. 2 
 
 WEBB'S CASE. 
 (In the King's Bench, 1577. 4 Leon. 110.) 
 
 In action upon the case, the plaintiff declared, that whereas Cobham 
 was indebted to J. S. and J. S. to the defendant, the said defendant 
 in consideration that the plaintiff would procure the said J. S. to 
 make a letter of attorney to the defendant to sue the said Cobham, 
 promised to pay and give to the plaintiff ilO. It was objected, here 
 was not any consideration for to induce the assumpsit; for the de- 
 fendant by this letter of attorney gets nothing but his labour and 
 travel. But the exception was not allowed of. For in this case 
 not so much the profit which redounds to the defendant, as the la- 
 bour of the plaintiff in procuring of the letter of attorney, is to be 
 respected.^ 
 
 SMITH V. SMITH. 
 (In the King's Bench, 1584. 3 Leon. 88.) 
 
 Lambert Smith, executor of Tho. Smith, brought an action upon the 
 case against John Smith, that whereas the testator having divers chil- 
 dren enfants, and lying sick of a mortal sickness, being careful to pro- 
 vide for his said children enfants ; the defendant in consideration the 
 testator would commit the education of his children, and the disposi- 
 tion of his goods after his death during the minority of his said chil- 
 dren, for the education of the said children to him, promised to the tes- 
 tator, to procure the assurance of certain customary lands to one of the 
 children of the said testator; and declared further, that the testator 
 thereupon constituted the defendant overseer of his will, and ordained 
 and appointed by his will, that his goods should be in the disposition of 
 the defendant, and that the testator died, and that by reason of that will, 
 the goods of the testator to such a value came to the defendant's hands 
 to his great profit and advantage. And upon non assumpsit pleaded, it 
 was found for the plaintiff : and upon exception to the declaration in 
 arrest of judgment for want of sufficient consideration it was said 
 by Wray, Chief Justice, that here is not any benefit to the defendant, 
 that should be a consideration in law, to induce him to make this prom- 
 ise; for the consideration is no other, but to have the disposition of 
 the goods of the testator pro educatione liberorum: for all the dis- 
 position is for the profit of the children ; and notwithstanding, that 
 such overseers commonly make gain of such disposition, yet tlie same 
 is against the intendment of the law, which presumes every man to be 
 true and faithful if the contrary be not shewed ; and therefore the law 
 shall intend, that the defendant hath not made any private gain to 
 
 2 In accord: Williams v. Jensen, 75 Mo. 681 (1882), securing the signature 
 of a married woman, even though it was legally inoperative. 
 
Seel) EABLY DEVELOPMENT 209 
 
 himself, but that he hath disposed of the goods of the testator to the 
 use and benefit of his children according to the trust reposed in him. 
 Which AyuffE, Justice, granted.; Gawdy, Justice, was of the con- 
 trary opinion. And afterwards by award of the Court, it was, that 
 the plaintiff nihil capiat per billam.* 
 
 THE LADY SHANDOIS v. SIMSON. * 
 (In the Queen's Bench, 1601. Oro. Eliz. 880.) 
 
 Error of a judgment in the Common Pleas, where the plaintiff de- 
 clared in debt for £256 upon several retainers to embroider divers 
 gowns. 
 
 The first error was, that the plaintiff's declaration was not good, be- 
 cause he declares (inter alia) that the defendant retained him such a 
 year, day, and place to embroider a satin gown for a maid-servant 
 of her daughter's, and to take for the same 40s. ; and the embroidering 
 of another's gown is not a good consideration. — Sed non allocatur ; for 
 ihasmuch as he did it upon her request, it is a sufficient consideration. 
 
 Secondly, it was alleged that debt lies not in this case, but an as- 
 sumpsit only ; for here is not any contract betwixt them, nor quid pro 
 quo ; and therefore Nelson's Case, 28 Eliz. was cited, that where one 
 retained Nelson to be attorney for another in feuch a suit, and agreed 
 that he should have so much for his labour ; he brought debt against 
 him who retained him, and not against him for whom he was retain- 
 ed; and it was adjudged that it lay not, for it is not any contract be- 
 tween them; but an assumpsit lies only because he became at his re- 
 quest the other man's attorney. — Sed r^on allocatur ; for here the em- 
 broidering of the gown at her request is sufficient, and it is at his elec- 
 tion to have debt or assumpsit ; as 37 Hen. VI, pi. 8. 3 Edw. IV, pi. 
 21 ; 7 Edw. IV, pi. 26 ; Dyer, 347, and 337, Wooton's case. * * * 
 
 FREEMAN V. FREEMAN. 
 
 (In the King's Bench, 1615. 2 Bulst. 269.) 
 
 In an action upon the case for a promise, the case appeared to be 
 this. Upon a motion in arrest of judgment, upon a non assumpsit, and 
 a verdict for the plaintiffe. It was urged that the action here brought 
 
 3 In Manwood and Burston's Case, 2 Leon. 203 (1587), it was said in argu- 
 ment : "There are three manner of considerations upon which an assumpsit 
 may be grounded : 1. A debt precedent ; 2. Where he to whom such a promise 
 is made is damnified by doing any thing, or spends his labour at the instance 
 of the promiser, although no benefit cometh to the promiser ; as I agree with 
 a surgeon to cure a poor man (who is a stranger unto me) of a sore, who doth 
 it accordingly, he shall have an action; 3. Or there is a present considera- 
 tion," etc. 
 
 * Part of the report, dealing with collateral matters, is omitted. 
 
 COEBIN CONT. — 14 
 
210 CONSIDERATION (Ch. 2 
 
 did not lie, for that there was no good consideration set forth in the 
 declaration, to groiirid the promise upon; and for this the case was, 
 that the defendant, in consideration that the plaintiff's wife, when she 
 was sole, would take the plaintiffe to her husband, he did promise to 
 assure unto her such an estate in land, for her life, for a joynture, ac- 
 cordingly, she did take the plaintiffe to her husband, and for not per- 
 formance of the promise, they did bring this action upon the case. 
 
 CoKB, and the whole Court, this is a good consideration, to raise the 
 promise; and so if one say to a chyrurgeon, cure su'ch a one, and I 
 will pay you for the cure, or deliver to such a merchant so many 
 cloathes, for which, if he doth not pay you, I will; though the party 
 promising, hath no benefit by this, yet this is a good consideration, and 
 the party liable to an action upon the case for the same. 
 
 Coke. If an act be to be done to another, at my request, of which I 
 am to have no benefit, yet for this I shall be chargeable in an action up- 
 on the case ; so if I do say to another, deliver so much to such a one 
 and I will pay you for it, by this I am chargeable, and this is a good 
 consideration to charge me with my promise, though no benefit at all 
 by this redounds unto me, the Court cleer of opini'oii, that in this prin- 
 cipal case the consideration was good, and so by the rule of the Court, 
 judgment was given for the plaintiffe. 
 
 SANDS V. TREVILIAN. 
 (In the King's Bench, 1628. Cro. Oar. 193.) 
 
 See, also, Cro. Car. 107. 
 
 Error of a judgment in the Common Pleas; where Trevilian, being 
 an attorney, brought an attachment of privilege against Sands, and de- 
 manded against him debt of ten pounds; and declares, that he being 
 an attorney there, the said Sands retained him to prosecute a suit in the 
 Common Pleas betwixt one Symms and Worlich, and desired the plain- 
 tiff to be attorney for Worlich, and promised to pay him all his fees, 
 and all that he should lay out to counsel and officers of the Court in 
 that suit : and shews, that he laid out such sums, which amount to the 
 money demanded ; whereupon he brought this action. 
 
 The defendant there pleaded nil debet ; and found against him, and 
 judgment for the plaintiff. 
 
 Error was now assigned, that in this case debt lies not against him 
 who so entreated him to be attorney ; for there is no contract between 
 them, nor hath he any quid pro quo ; but he ought to have had an as- 
 sumpsit (because he did it at his request), if he for whom he is retain- 
 ed doth not pay him his fees. — And thereto agreed all the Court ; but 
 if he should have debt they doubted. 
 
 But all the Court conceived, that no action of debt lies hei-e, but an ac- 
 tion upon the case only ; lor the retainer being for another man, and he 
 being attorney for another man who agreed to that retainer, there is 
 
■S^C. 1) EAfiLY DEVELOPMENT 211 
 
 no cause of debt betwixt him who retained and the attorney, and no 
 contract nor consideration to ground this action; apd he who is so 
 retained may well have debt for his fees against him for whom he was 
 retained, he having agreed thereto ; wherein there cannot be any wager 
 of law ; but against the defendant, who is a stranger to the suit, and 
 at whose request he took upon him to be attorney, debt lies not, as 27 
 Hen. VIII, pi. 24; and in the case of Rolls v. Germyn, Cro. Eliz. 425, 
 it was so resolved. Whereupoii it was adjudged, that the first judg- 
 ment should be reversed. 
 
 Richardson, Chief Justice, and Hutton and HarvEy, Justices of 
 the Common Pleas, being moved herein, said, that this point was never 
 moved before them ; and they were of the same opinion, that debt lies 
 not, but only an action on the case." 
 
 FOOLY AND PRESTON'S CASE. 
 
 (In the Common Pleas, 1586. 1 Leon. 297.) 
 
 In an action upon the case the plaintiff declared, that whereas John 
 Gibbon was bound unto the plaintiff in quodam scripto obligatorio, 
 sigillo suo sigillat. and coram, &c. recognito in forma statuti Stapul. 
 The defendant in consideration that the plaintiff would deliver to him 
 the said writing to read over, promised to deliver the same again to 
 the plaintiff within six days after, or to pay to him £ 1000 in lieu there- 
 of, upon which promise the plaintiff did deliver to the defendant the 
 said writing; but the defendant had not, nor would not deliver it back 
 to the plaintiff, to the great delay of the execution thereof, and the de- 
 fendant did demur in law upon the_ declaration. It was objected, that 
 here i_s no sufficient Consideration appearing in the declaration upon 
 which a promise might be grounded; but it was the opinion of the 
 whole Court, that the consideration set forth in the declaration was 
 good and sufficient ; and by Anderson. It is usual and frequent in the 
 King's Bench : if I deliver to you an obligation to rebail unto me, I 
 shall have an action upmi the case without an express assumpsit ; and 
 afterwards judgment was given for the plaintiff.* 
 
 a Argument of counsel omitted. 
 
 8 In accord: Bainbridge v. Firmstone, 8 Adol. & El. 743 (1838), plaintifC de- 
 livered boilers over to defendant for him to weigb on his promise to replace 
 them; Coggs v. Bernard, 2 Ld. Raym. 920 (1703); Hart v. Miles, 4 C. B. 
 (N. S.) 371 ''1858). Cf. Pickas v. Guile, Yelv. 128 (1608) ; Kiches v. Briggs, 
 Yelv. 4 (16()1). 
 
212 CONSIDERATION (Ch. 2 
 
 wheaTley v. low. 
 
 (in the King's Bench, 1623. Cro. Jac. 668.) 
 
 Action on the case. Whereas he was obliged to J. S. in forty pounds 
 for the payment of twenty pounds; and the bond being forfeited, he 
 delivered ten pounds to the defendant, to the intent he should pay it 
 to J. S. in part of payment sine uUa mora; that in consideratione inde 
 the defendant assumed, &c. and assigns for breach, that he had not 
 paid ; whereupon the other had sued hira for this debt, &c. 
 
 The defendant pleaded non assumpsit; and verdict for the plaintiff. 
 
 It was moved in arrest of judgrrient that this is not any considera- 
 tion, because it is not alleged, that he delivered it to the d.efendant up- 
 on his request; and the acceptance of it to deliver to another sine mora, 
 cannot be any benefit to the defendant to charge him with this prom- 
 ise. 
 
 Sed non allocatur; for, being that he accepted this money to deliver, 
 and promised to deliver it, it is a good consideration to charge him. 
 Wherefore it was adjudged for the plaintiff. — A writ of error being 
 brought, and this matter only assigned for error, the judgment was af- 
 firmed.'' 
 
 SIR ANTHONY STURLYN v. ALBANY. 
 
 (In the King's Bench, 1587. Cro. Eliz. 6T.) 
 
 Assumpsit. The case was, the plaintiff had made a lease to J. S. of 
 land for life rendering rent. J. S. grants all his estate to the de- 
 fendant ; the rent was behind for .divers years ; the plaintiff demands 
 the rent of the defendant, who assumed that if the plaintiff could shew 
 to him a deed that the rent was due, that he would pay to him the rent 
 and the arrearages ; the plaintiff alledgeth that upon such a day 
 of, &c. at Warwick, he shewed unto him the indenture of lease, by 
 which the rent was due, and notwithstanding he had not paid him the 
 rent and the arrearages due for four yearst' Upon non assumpsit 
 pleaded it was found for the plaintiff; and damages assessed to so 
 much as the rent and arrearages did amount unto. — And it was moved 
 in arrest of'judgment, that there was no consideration to ground an 
 action, for it is but the shewing of the deed, which is no considera- 
 tion. — 2. The damages ought only to be ' assessed for the time the 
 rent Was behind, and not for the rent and the arrearages; for he 
 hath other remedy for the rent; and a recovery in this action shall 
 be no bar in another action. But it was adjudged for the plaintiff: 
 for when a thing is to be done by the plaintiff, be it never so small, 
 this is a sufficient consideration, to ground an action ; and here the 
 
 ' See, also, Carr v. Maine Cent, E. Co., 78 N. H. 502, 102 Atl. 532 L. R. A. 
 1O1810, 389 (1917), post, p. 231. 
 
Sec. 1) EARLY DEVELOPMENT 213 
 
 shewing of the deed is a cause to avoid suit ; and the rent and arrear- 
 ages may be assessed all in damages: but they took order that the 
 plaintiff should release to the defendant all the arrearages of rent 
 before execution should be awarded,' * * * 
 
 KNIGHT V. RUSHWORTH. 
 (In the Common Pleas, 1596. Cro. Eliz. 469.) 9 
 
 Assumpsit. The case was, that one Mary Rushworth had entered 
 into a bond of £200 to the plaintiff; and after gave all her goods to 
 the defendant to pay her debts. The defendant pretending that this 
 bond was read to the said Mary Rushworth as an obligation of £100 
 only and so void, assumed to the plaintiff, that if he and two witnesses 
 would deponere before the Mayor of Lincoln, 'that the obligation was 
 read to Mary Rushworth as an obligation of £200 that he would pay 
 it. Whereupon the plaintiff, with two others, came'before the Mayor 
 of Lincoln, and there deposed upon a book accordingly; and here- 
 upon brought this action. Whereto it was demurred. — Yelverton, for 
 the defendant, moved, that this action lies not; for there is not any 
 consideration besides this oath, which is unlawful, and therefore void. 
 
 Hearn. , It is not material whether the consideration be for the 
 plaintiff's benefit ; for if it be any charge or trouble to the defendant, it 
 sufficeth ; as in Albanie's case ; and he conceived the oath to be lawful 
 enough. * * * 
 
 Anderson. The travail of coming before the mayor is a very good 
 
 consideration ; and truly the oath is not illegal, being taken before him ; 
 
 and the smallness of a consideration is not material, if there be any. 
 * * * 
 
 WalmsIvEy, accord. * * * 
 
 Beaumond and OwEw doubted herein at first; but afterwards they 
 agreed with their companions, that the consideration was sufficient 
 and lawful — Wherefore it was adjudged for the plaintiff.^" 
 
 8 Part of the report is omitted. 
 
 » Part* of the report are omitted. 
 
 10 In accord: Brooks v. Ball, 18 Johns. (N. Y.) 337 (1820). 
 
214 CONSIDERATION (Ch. 2 
 
 ,. HAIGH et al. v. BROOKS. 
 
 (In the Queen's Bench and the Exchequer Chamber, 1839 and 1840. 10 Adol. 
 
 & El. 309.) 
 
 The following written guarantee was in the possession of the 
 plaintiffs : 
 
 "Manchesten February 4, 1837. 
 "Messrs. Haigh & Franceys: 
 
 "Gentlemen : In consideration of your being in advance to Messrs. 
 John Lees & Sons in the sum of £10,000 for the purchase of cotton, 
 I do hereby give you my guarantee for that amount (say, £10,000) on 
 their behalf. John Brooks." 
 
 In assumpsit, the plaintiffs now allege that at the defendant's request 
 they surrendered this . document to the defendant in return for his 
 promise that he would see paid at maturity three bills of exchange 
 for some £9,666, payable three months after date, accepted and to be 
 paid by John Lees and Sons; that the bills became due and have not 
 been paid. 
 
 The defendant pleaded that the written guarantee surrendered to him 
 was void and of no value for the reason that it was a promise to pay 
 the debt of another, to-wit : John Lees and Sons, and so was within the 
 provisions of the statute of frauds, and that the writing, did not express 
 the consideration for which the promise was made, as the said statute 
 requires. 
 
 To this plea the plaintiff demurred, assigning for cause, "that it is 
 admitted by the plea that the memorandum, the giving up of which 
 was the consideration of the guarantee in the said declaration men- 
 tioned, was actually given up to the said defendant by the said plain- 
 tiffs, and the consideration was therefore executed by the said defend- 
 ant, and that, even if the original memorandum was not binding in 
 point of law, the giving up was a sufficient consideration for the 
 promise in the declaration mentioned." Joinder.^^ 
 
 The judgment of the Court of Queen's Bench was rendered by 
 
 Lord Denman, C. J. This action was brought upon an assumpsit to 
 see certain acceptances paid, in consideration of the plaintiffs giving 
 up a guarantee of £10,000, due from the acceptor to the plaintiffs. 
 Plea, that the guarantee was for the debt of another, and that there 
 was no writing wherein the consideration appeared, signed by the de- 
 fendant, and so the giving it up was no good consideration for the 
 promise. Demurrer, stating for cause that the plea is bad, because 
 the consideration was executed, whether the guarantee were binding 
 in law or not. The form of the guarantee was set out in the plea. 
 "In consideration of your being in advance to Messrs. John Lees and 
 Sons, in the sum of £10,000, for the purchase of cotton, I do hereby 
 
 1 1 Parts of the report have been omitted. 
 
Seel) EARLY DEVELOPMENT 215 
 
 give you my guarantee for that amount, (say ilO.OOO,) on their behalf. 
 John Brooks." 
 
 It was argued for the defendant, that this guarantee is of no force, 
 because the fact of the plaintiffs being already in advance to Lees could 
 form no consideration for the defendant's promise to guarantee to the 
 plaintiffs the payment of Lees' acceptances. In the first place, this 
 is by no means clear. That "being in advance" must necessarily mean 
 to assert that he was in advance of the time of giving the guarantee, 
 is an assertion open to argument. It may, possibly, have been intended 
 as prospective. If the phrase had been "in consideration of your be- 
 coriiing in advance," or, "on condition of your being in advance," such 
 would have been the clear import. As it is, nobody can doubt that the 
 defendant took a great interest in the affairs of Messrs. Lees, or believe 
 that the plaintiffs had not come under the advance inentioned at the 
 defendant's request. Here is then sufficient doubt to make it worth the 
 defendant's while to possess himself of the guarantee ; and, if that be 
 so, we have no concern with the adequacy or inadequacy of the price 
 paid or promised for it. 
 
 But we are by no means prepared to say that any circumstances 
 short of the imputation of fraud in fact, could entitle us to hold 
 that a party was not bound by a promise made upon any considera- 
 tion which could be valuable; while of its being so the promise by 
 which it was obtained from the holder of it must always afford some 
 proof. 
 
 Here, whether or not the guarantee could have been available within 
 the doctrine of Wain v. Warlters, 5 East, 10, the plaintiffs were in- 
 duced by the defendant's promise to part with something which they 
 might have kept, and the defendant obtained what he desired by means 
 of that promise. Both being free and able to judge for themselves, 
 how can the defendant be justified in breaking this promise, by dis- 
 covering afterwards that the thing in consideration of which he gave 
 it did not possess that value which he supposed to belong to it? It 
 cannot be ascertained that that value was what he most regarded. He 
 may have had other objects and motives ; and of their weight he was 
 the only judge. We, therefore, think the plea bad: and the demur- 
 rer must prevail. 
 Judgment for the plaintiffs. * * * 
 From this judgment a writ of error was argued in the Exchequer 
 
 Chamber before Lord Abinger, C. B., BosanqueT, Coltman, and 
 MaulE, J J., and AldeRSON and RoLFE, BB. Speaking for this court, 
 
 Lord AbingER said : 
 
 It is the opinion of all the Court that there was in the guarantee an 
 
 ambiguity that might be explained by evidence, so as to make it a 
 
 valid contract, and, therefore this ' was a sufficient consideration for 
 
 the promise declared upon. 
 
 It is also thei opinion of all the Court, with the exception of my 
 
 Brother Mauli^, who entertained some doubt on the question, that the 
 
216 CONSIDERATION (Ch. 2 
 
 words both of the declaration and the plea import tha;t the paper on 
 which the guarantee was written was given up, and that the actual 
 surrender of the, possession of the paper to the defenda,nt was a sufi5- 
 cient consideration without reference to its contents. 
 Judgment affirmed.^'' 
 
 SCHNELL V. NELL. 
 
 (Supreme Court of Indiana, 1861. 17 Ind. 29, 79 Am. Dee. 453.) 
 
 Perkins, J. Action by J. B. Nell against Zacha'rias Schnell, upon 
 the following instrument: 
 
 "This agreement, entered into this 13th day of February, 1856, be- 
 tween Zach. Schnell, of Indianapolis, Marion county, state of Indiana, 
 as party of the first part, and J. B. Nell, of the same place, Wendelin 
 Lorenz, of Stilesville, Hendricks county, state of Indiana, and Donata 
 Lorenz, of Frickinger, Grand Duchy of Baden, Germany, as parties of 
 the second part, witnesseth: The said Zacharias Schnell agrees as 
 follows : Whereas his wife, Theresa Schnell, how deceased, has made 
 a last will and testament in which, among other provisions, it was Or- 
 dained that every one of the above-named second parties, should re- 
 ceive the sum of $200 ; and whereas the said provisions of the will must 
 remain a nullity, for the reason that no property, real or personal, was 
 in the possession of the said Theresa Schnell, deceased, in her own 
 name, at the time of her death, and all property held by Zacharias and 
 Theresa Schnell jointly, therefore reverts to her husband; and where- 
 as the said Theresa Schnell has also been a dutiful and loving wife to 
 the said Zach. Schnell, and has materially aided him in the acquisition 
 of all property, real and personal, now possessed by him; for, and in 
 consideration of all this and the love and respect he bears to his wife ; 
 and, furthermore, in consideration of one cent, received by him of the 
 second parties, he, the' said Zach. Schnell, agrees to pay the above 
 named sums of money to the parties of the second part, to wit : $200 
 to the said J. B. Nell; $200 to the said Wendelin Lorenz; and $200to 
 the said Donata Lorenz, in the following installments, viz., $200 in 
 one year from the date of these presents ; $200 in two years ; and $200 
 in three years ; to be divided between the parties in equal portions of 
 $66% each year, or as they may agree, till each one has received his 
 full sum of $200. And the said parties of the. second part, for, and in 
 consideration of this, agree to pay the above-named sum of money (one 
 cent), and to deliver up to said Schnell, and abstain from collecting 
 any real or supposed claims upon hirn or his estate, arising from the 
 said last will and testament of the said Theresa Schnell, deceased. In 
 witness whereof, the said parties have, on this 13th day of February, 
 
 12 In accord: Judy v. Louderman, 48 Ohio St. 562, 29 N. E. 181 (1891), sur- 
 render of. a worthless note of a person who had died insolvent long before ; 
 Wilkinson v. Oliveira, 1 Bing. N, O. 490 (1835). 
 
Seel) EARLY DEVELOPMENT 217 
 
 1856, set hereunto their hands and seals. Zacharias Schnell. [Seal] 
 J. B. Nell. [Seal.] Wen. Lorenz. [Seal.]" 
 
 The complaint contained no averment of a consideration for the in- 
 strument, outside of those expressed in it; and did not aver that the 
 one cent agreed to be paid, had been paid or tendered. 
 
 A demurrer to the complaint was overruled. 
 
 The defendant answered, that the instrument sued on was given for 
 no consideration whatever. 
 
 He further answered, that it was given for no consideration, because 
 his said wife, Theresa, at the time she made the will mentioned, and at 
 the time of her death, owned, neither separately, nor jointly with her 
 husband, or any one else (except so far as the law gave her an interest 
 in her husband's property), any property, real or personal, etc. 
 
 The will is copied into the record, but need not be into this opinion. 
 
 The court sustained a demurrer to these answers, evidently on the 
 ground that they were regarded as contradicting the instrument sued 
 on, which particularly set out the considerations upon which it was 
 executed. But the instrument is latently ambiguous on this point. See 
 Ind. Dig. p. 110. 
 
 The case turned below, and must turn here, upon the question wheth- 
 er the instrument sued on does express a consideration sufficient to 
 give it legal obligation, as against Zacharias Schnell. It specifies three 
 distinct considerations for his promise to pay $600: 
 
 (1) A promise, on the part of the plaintififs, to pay him one cent. 
 
 (2) The love and affection he bore his deceased wife, and the fact 
 that she had done her part, as his wife, in the acquisition of the prop- 
 erty. 
 
 (3) The fact that she had expressed her desire, in the form of an in- 
 operative will, that the persons named therein should have the sums of 
 money specified. 
 
 The consideration of one cent will not support the promise of Schnell. 
 It is true, that as a general proposition, inadequacy of consideration 
 will not vitiate an agreement. Baker v. Roberts, 14 Ind. 552. But this 
 doctrine does not apply to a mere exchange of sums of money, of coin, 
 whose value is exactly fixed, but to the exchange of something of, in it- 
 self, indeterminate value, for money, or, perhaps for other thing of in- 
 determinate value. In this case had the one cent mentioned been some 
 particular one cent, a family piece, or ancient, remarkable coin, posses- 
 sing an indeterminate value, extrinsic from its simple money value, a 
 different view might be taken. As it is, the mere promise to pay six 
 hundred dollars for one cent, even had the portion of that cent due 
 from the plaintiff been tendered, is an unconscionable contract, void, 
 at first blush upon its face, if it be regarded as an earnest one. Hardes- 
 ty V. Smith, 3 Ind. 39. The consideration of one cent is, plainly, in 
 this case, merely nominal, and intended to be so. As the will and testa- 
 ment of Schnell's wife imposed no legal obligation upon him to dis- 
 charge her bequests out of his property, and as she. had none of her 
 
218 CONSIDBEATION (Ch, 2 
 
 own, his promise to discharge them was not legally binding upon him, 
 on that ground. A moral consideration, only, will not support a prom- 
 ise. Ind. Dig., p. 13. And for the same reason, a valid consideration 
 for his promise cannot be found in the fact of a compromise of a dis- 
 puted claim; for where such claim is legally groundless, a promise 
 upon a compromise of it, or of a suit upon it, is not legally binding. 
 Spahr V. Hollingshead, 8 Blackf. 415. There was no mistake of law 
 or fact in this case, as the agreement admits the will inoperative and 
 void. The promise was simply one to make a gift. The past services 
 of his wife, and the love and affection he had borne her, are objection- 
 able as legal considerations for Schnell's promise, on two grounds: 
 (1) They are past considerations. Ind. Dig., p. 13. (2) The fact that 
 Schnell loved his wife and that she had been industrious, constituted 
 no consideration for his promise to pay J. B. Nell, and the Lorenzes, 
 a sum of money. Whether, if his wife, in her lifetime, had made a 
 bargain with Schnell, that,' in consideration of his promising to pay, 
 after her death, to the persons named, a sum of money, she would be 
 industrious, and worthy of his affection, such a promise would have 
 been valid and consistent with public policy, we need not decide. Nor 
 is the fact that Schnell now venerates the memory of his deceased wife 
 a legal consideration for a promise to pay any third person money. 
 
 The instrument sued on, interpreted in the light of the facts alleged 
 in the second paragraph of the answer, will not support an action. The 
 demurrer to the answer should have been overruled. See Stevenson v. 
 Druley, 4 Ind. 519. 
 
 Judgment reversed.^' 
 
 NEIKIRK V. WILLIAMS. 
 
 (Supreme Court of Appeals of West Virginia, 1918. 81 W. Va. 558, 94 
 
 S. E. 947.) 
 
 Action by F. C. Neikirk against W. T. Williams. Judgment for 
 plaintiff, and defendant brings error. Reversed, and remanded for a 
 new trial. 
 
 Williams, J." In the circuit court, on appeal from the judgment 
 of a justice, plaintiff recovered a judgment for $300, and defendant 
 has brought the case here on writ of error. No written pleadings 
 were filed before the justice or in court, and plaintiff's testimony is 
 the only evidence in the case. His claim is based on defendant's prom- 
 
 13 See in accord: Shepard v. Rliodes, T R. I. 470, 84 Am. Dec. 573 (1863); 
 Wolford V. Powers, 85 Ind. 294, 44 Am. Rep. 16 (1S82). The rule does not apply 
 where gold as a commodity is being exchanged for depreciated paper monev 
 Peabody v. Speyers, 56 N. Y. 230 (1874). 
 
 "A cent or a pepper com, in legal estimation, would constitute a valuable 
 consideration." Emery, J., in Whitney v. Stearns, 16 Me. 394, 397 (1839). 
 
 1* Part of the opinion is omitted. 
 
Sec. 1) EARLY DEVELOPMENT 219 
 
 ise to pay him $500 in consideration for his release f roiir an' agreement 
 made with plaintiff, as agent of the Equitable Life Assurance Company, 
 to purchase an annuity policy the annual premium on which was, $1,984; 
 the $500 being in lieu of commissions which plaintiff would have been 
 entitled to retain out of the premium, if it had been paid. The case 
 was tried by a jury in the absence of defendant, and a verdict returned 
 for plaintiff in accordance with a peremptory instruction by the court. 
 * * * At the time of the alleged promise plaintiff says the policy 
 had not. been forwarded to the insurance company, and he had the right 
 to cancel, and did cancel it. 
 
 Counsel for defendant insist that the verdict is contrary to law 
 because the promise sued on is without any consideration. The $500 
 represented approximately the commissions which plaintiff was enti- 
 tled to retain out of the premium, if it had been paid, as compensation 
 for his services as agent of the insurance company, and if defendant 
 was under no legal obligation to pay the premium, it follows that he 
 was not bound to pay plaintiff any part of his commissions, and the 
 promise to, pay would be nudum pactum. No contractual relation ex- 
 isted between plaintiff and defendant. Plaintiff was performing no 
 services for defendant in his efforts to sell him the insurance, and 
 therefore no promise to compensate him could be implied. Defend- 
 ant was not legally bound to pay the premium, and, notwithstanding 
 he had drawn his check for the amount of it and delivered it to plain- 
 tiff, he could have countermanded it without violating any legal right 
 of the insurance company or of its agent the plaintiff. The insurance 
 company was fully protected, in case of nonpayment of premiurn, by 
 its right to forfeit the policy, even if the policy had been approved by 
 it, and this seems to be its only remedy. 
 
 Contracts of insurance being unilateral, the insurer has no right gen- 
 erally to maintain a suit for premiums due, and the insured, if he has 
 not expressly promised to pay, is at liberty to refuse to make payment, 
 as it is generally only a condition precedent to his protection under 
 the policy. By his failure to pay the insured simply loses his benefit. 
 He has the option to pay or not, and thus continue the insurance com- 
 pany's obligation or terminate it at his pleasure. 2 Bacon on Ins. (4th 
 Ed.) § 456; 1 Cobley's Briefs, 82; 2 Cooley's Briefs, 990; New York 
 Life Ins. Co. v. Statham, 93 U. S. 24, 23 L. Ed. 789, and Clark v. 
 Schromeyer, 23 Ind. App. 565, 55 N. E. 785. Plaintiff had not as- 
 sumed payment of the premium for defendant, and was not liable 
 to the insurance company for any part of it. The contract of insur- 
 ance had not been consummated, and in declining to pay the premium 
 defendant simply exercised his legal right. Hence when plaintiff can- 
 celed the policy, which is the only consideration for defendant's prom- 
 ise, he neither surrendered any legal right nor benefited the situation of 
 defendant, and therefore defendant's promise was without considera- 
 tion, and, for that reason, is not enforceable. That every promise must 
 be supported by a valuable consideration, before recovery can be had on 
 
220 CONSIDERATION (Ch. 2 
 
 it, is a principle too well recognized to need any citation of author- 
 ities. 
 
 The judgment will be reversed, and the cause remanded for a new 
 trial. 
 
 CRISP V. GAMEL. 
 (In the King's Bench, 1605. Cro. Jae. 12S.) 
 It was resolved that where, in an assumpsit, two considerations be 
 alleged, the one good and sufficient and the other idle and vain, if that 
 which is good be proved, it sufficeth ; and although he fails in the proof 
 of the other, it is not material, because it was in vain to allege it ; and 
 it is as if it had not been alleged." 
 
 RANN et al. v. HUGHES. 
 (In the House of Lords, 1778. 7 Term K. 350, note.) 
 
 The declaration stated that on the 11th of June, 1764, divers dis- 
 putes had arisen between the plaintiffs' testator and the defendant's in- 
 testate, which they referred to arbitration ; that the arbitrator awarded 
 that the defendant's intestate should pay to the plaintiffs' testator 
 £983. That the defendant's intestate afterwards died possessed of 
 effects sufficient to pay that sum ; that administration was granted to 
 the defendant ; that Mary Hughes died, having appointed the plaintiffs 
 her executors; that at the time of her death the said sum of £983 
 was unpaid, "by reason of which premises the defendant as admin- 
 istratrix became liable to pay to the plaintiffs as executors the said 
 sum, and being so liable she in consideration thereof undertook and 
 promised to pay &c." The defendant pleaded non assumpsit; plene 
 administravit ; and plene administravit, except as to certain goods &c. 
 which were not sufficient to pay an outstanding bond debt of the in- 
 testate's therein set forth &c. The replication took issue on all these 
 pleas. Verdict for the plaintiff on the first issue, and for the defend- 
 ant on the two last; and on the first a general judgment was entered 
 in B. R. against the defendant de bonis propriis. This judgment was 
 reversed in the Exchequer Chamber; and a writ of error was after- 
 wards brought in the House of L,ords, where after argument the fol- 
 lowing question was proposed to the judges by the lord chancellor, 
 "Whether sufficient matter appeared upon the declaration to warrant 
 after verdict the judgment against the defendant in error in her per- 
 is In iaccord: Cripps v. Gelding, 1 EoUe, Abr. 30, 1 Leon. 296 (1586) ; Brad- 
 burne v. Bradburne, Cro. Eliz. 149 (1.5S9) ; Colston v. Carre, 1 Rolle, Abr. 30 
 (1600) ; Best v. Jolly, 1 Sid. 38 (1661) ; King v. Sears, 2 Cr., M. & R. 48 (1835) ; 
 Drummond Realty & Investment Co. v. W. H. Thompson Trust Co. (Mo.) 178 
 S. W. 470 (1915) ; King v.' King, 63 Ohio St. 363, 59 N. E. Ill, 52 L. R. A. 
 157, 81 Am. St. Rep. 635 (1000). 
 
Seel) EARLY DEVELOPMENT 221 
 
 sonal capacity ;" upon which the Lord Chief Baron Skynner delivered 
 the opinion of the judges to this effect 
 
 It is undoubtedly true that every man is by the law of nature bound 
 to fulfil his engagements. It is equally true that the law of this country 
 supplies no means, nor affords any .remedy, to compel the perform- 
 ance of an agreement made without sufficient consideration ; such 
 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- 
 mentioned sense only that it is to be understood in our law. The dec- 
 laration states that the defendant being indebted as administratrix 
 promised to pay when requested, and the judgment is against the de- 
 fendant generally. The being indebted is of itself a sufficient considera- 
 , tion to ground a promise, but the promise must be coextensive with the 
 consideration unless some particular consideration of fact can be found 
 here to warrant the extension of it against the defendant in her own 
 capacity. If a person indebted in one right in consideration of for- 
 bearance for a particular time promise to pay in another right, this con- 
 venience will be a sufficient consideration to warrant an action against 
 him or her in the latter right : but here no sufficient consideration oc- 
 curs to support this demand against her in her personal capacity ; for 
 she derives no advantage or convenience from the promise here made. 
 For if I promise generally to pay upon request what I was liable to pay 
 upon request in another right, I derive no advantage or convenience 
 from this promise, and therefore there is not sufficient consideration 
 • for it. But it is said that if this promise is in writing that takes away 
 the necessity of a consideration and obviates the objection of nudum 
 pactum, for that cannot be where the promise is put in writing; and 
 that after verdict, if it were necessary to support the promise that it 
 should be in writing, it will after verdict be presumed that it was in 
 writing : and this last is certainly true ; but that there cannot be nudum 
 pactum in writing, whatever may be the rule of the civil law, there is 
 certainly none such in the law of England. His lordship observed upon 
 the doctrine of nudum pactum delivered by Mr. J. Wilmot in the case 
 of Pillans v. Van Mierop and Hopkins, 3 Burrows, 1663, that he con- 
 tradicted himself, and was also contradicted by Vinnius in' his Com- 
 ment on Justinian. 
 
 All contracts are by the laws of England distinguished into agree- 
 ments by specialty, and agreements by parol ; nor is there any such third 
 class as some of the counsel have endeavoured to maintain, as contracts 
 in writing. If they be merely written and not specialties, they are 
 parol, and a consideration must be proved. But it is said that the stat- 
 ute of frauds has taken away the necessity of any consideration in this 
 case ; the statute of frauds was made for the relief of personal repre- 
 sentativefe and others, and did not intend to charge them further than 
 by common law they were chargeable. His lordship here read those 
 sections of, that statute which relate to the present subject. He ob- 
 served that the words were merely negative, and that executors and ad- 
 
222 CONSIDERATION (Cll. 2 
 
 ministrators should not be liable out of their own estates, unless the 
 agreement upon which the action was brought or some memorandum 
 thereof was in writing and signed by the party. But this does not prove 
 that the agreement was still not liable to be tried and judged of as all 
 other agreements merely in writing are by the common law, and does 
 not prove the converse of the proposition that when in writing the par- 
 ty must be at all events liable. He here observed upon the case of Pil- 
 lans V. Van Mierop in Burrows, and the case of Losh v. Williamson, 
 Miph. 16 Geo. III. in B. R. ; and so far as these cases went on the doc- 
 trine of nudum pactum, he seemed to intimate that they were erroneous. 
 He said that all his brothers concurred with him that in this case there 
 was not a sufficient consideration to support this demand as a personal 
 demand against the defendant, and that its being now supposed to have, 
 been in writing makes no difference. The consequence of which is that 
 the question put to us must be answered in the negative. 
 
 And the judgment in the Exchequer Chamber was affirmed.^* 
 
 SECTION 2.— RELIANCE ON A PROMISE AS CONSIDER- 
 ATION 
 
 (Must Consideration be the Motive of the Promisor or the Inducing 
 Cause of His Promise?) 
 
 THOMAS v. THOMAS. 
 
 (In the Queen's Bench, 1842. 2 Q. B. 851.) 
 
 Assumpsit. The declaration stated an agreement between plaintiff, 
 and defendant that the defendant should, when thereto required by the 
 plaintiff, by all necessary deeds, conveyances, assignments, or other as- 
 surances, grants, etc., or otherwise, assure a certain dwelling house 
 and premises, in the county of Glamorgan, unto plaintiff for her life, 
 or so long as she should continue a widow and unmarried, and that 
 plaintiff should, at all times during which she should have possession 
 of the said dwelling house and premises, pay to defendant and one 
 Samuel Thomas (since deceased), their executors, administrators or 
 
 16 In PUlans v. Van Mierop, 3 Burr. 1663 (1765), Lord Mansfield held that a 
 promise was binding merely becaitse it was in writing. The defendant had 
 written to the plaintiff promising to accept a bill to be drawn on the credit of 
 one White. 
 
 It is frequently provided by statute that in the case of written, contracts 
 a consideration is presumed to exist and the burden of proof is upon him who 
 denies its existence B. g., see Ala. Code 1896, § 1800; Oal. Civ. Code, § 1614; 
 Iowa Code, §§ 3069, 3070 ; Mo. Rev. St. 1909, § 2774 ; Mont. Code Civ. Proc. 
 1895, § 3266, subd. 39 (Rev. Codes, § 7962); N. M. Laws 1901, c. 62, § 12; 
 Okl. Rev. Laws 1910, §§ 934, 935 ; S. D. Rev. Civ. Code, § 1232. 
 
Sec. 2) _ RELIANCE ON A PROMISE AS CONSIDERATION 223 
 
 assigns, the sum of il yearly toward the ground rent payable in re- 
 spect of the said dwelling house and other premises thereto adjoining, 
 and keep the said dwelling house and premises in good and teriantable 
 repair. That the said agreement being made, in consideration thereof, 
 and of plaintiff's promise to. perform the agreement, Samuel Thomas 
 and the defendant promised to perform the same ; and that, although 
 plaintiff afterward and before the commencement of the suit, to wit, 
 etc., required of defendant to grant, etc., by a necessary and sufficient 
 deed, etc., the said dwelling house, etc., to plaintiff for her life, or while 
 she continued a widow, and though she had then continued, etc., and 
 still was a widow and unmarried, and although she did, to wit, on, 
 etc., tender to the defendant for his execution , a certain necessary 
 and sufficient deed, etc., proper and sufficient for the conveyance, etc., 
 and although, etc. (general readiness of plaintiff to perform), yet de- 
 fendant did not nor would then or at any other time convey, etc. 
 
 Pleas. 1. Non assumpsit. 2. That there was not the consideration 
 alleged in the declaration of the defendant's promise. 3. Fraiid and 
 covin. 
 
 Issues thereon. 
 
 At the trial, before Coltman, J., at the Glamorganshire Lent Assizes, 
 1841, it appeared that John Thomas, the deceased husband of the plain- 
 tiff, at the time of his death, in 1837, was possessed of a row of seven 
 dwelling houses in Merthyr Tidvil, in one of which, being the dwelling 
 house in question, he was himself residing; and that by his will he 
 appointed his brother Samuel Thomas (since deceased) and the defend- 
 ant executors thereof, to take possession of all his houses, etc., subject 
 to certain payments in the will mentioned, among which were certain 
 charges in money for the benefit of the plaintiff. In the evening be- 
 fore the day of his death he expressed orally a wish to make some fur- 
 ther provision for his wife ; and on the following morning he declar- 
 ed orally, in the presence of two witnesses, that it was his will that his 
 wife should have either the house in which he lived and all that it con- 
 tained, or an additional sum of £ 100 instead thereof. 
 
 This declaration being shortly afterward brought to the knowledge 
 of Samuel Thomas and the defendant, the executors and residuary leg- 
 atees, they consented to carry the intentions of the testator so express- 
 ed into effect; and, after the lapse of a few days, they and the plain- 
 tiff executed the agreement declared upon; which, after stating the 
 parties, and briefly reciting the will, proceeded as follows : 
 
 "And, whereas the said testator, shortly before his death, declared 
 in the presence of several witnesses, that he was desirous his said wife 
 should have and enjoy during her life, or so long as she should con- 
 tinue his widow, all and singular the dwelling house," etc., "or £100 
 out of his personal estate," in addition to the respective legacies and 
 bequests given her in and by his said will; "but such declaration and 
 desire was not reduced to writing in the lifetime of the said John 
 Thomas and read over to him ; but the said Samuel Thomas and Ben- 
 
224 CONSIDBEATION (Ch. 2 
 
 jamin Thomas are fully convinced and satisfied that such was the desire 
 of the said testator, and are willing and desirous that such intention 
 should be carried into full efifect. Now these presents witness, and it 
 is hereby agreed and declared by and between the parties, that, in con- 
 sideration of such desire and of the premises," the executors would con- 
 vey the dwelling house, etc., to the plaintiff and her assigns during her 
 life, or for so long a time as she should continue a widow and unmar- 
 ried: "provided, nevertheless, and it is hereby further agreed and de- 
 clared, that the said Eleanor Thomas, or her assigns, shall and will, at 
 all times during which she shall have possession of the said dwelling 
 house, etc., pay to the said Samuel Thomas and Benjamin Thomas, 
 their executors, etc., the sum of £1 yearly toward the ground rent 
 payable in respect of the said dwelling house and other premises there- 
 to adjoining, and shall and will keep the said dwelling house and prem- 
 ises in good and tenantable repair;" with other provisions not affect- 
 ing the questions in this case. 
 
 The plaintiff was left in possession of the dwelling house and prem- 
 ises for some time ; but the defendant, after the death of his coexecu- 
 • tor, refused to execute a conveyance tendered to him for execution pur- 
 suant to the agreement, and, shortly before the trial, brought an eject- 
 merit, under which he turned the plaintiff out of possession. It was 
 objected for the defendant that, a part of the consideration proved be- 
 ing omitted in the declaration, there was a fatal variance. The learn- 
 ed judge overruled the objection, reserving leave to move to enter a 
 nonsuit. Ultimately a verdict was found for the plaintiff on all the 
 issues ; and, in Easter Term last, a rule nisi was obtained pursuant to 
 the leave reserved. 
 
 E. V. Williams, for the defendant, argued that this was "a mere 
 gift cum onere," and that the only consideration was "the testator's 
 expressed wish." "What is meant by the consideration for a promise, 
 but the cause or inducement for making it ? Plowden, commenting on 
 Sharington v. Strotton, says (page 309), 'Note : That by the civil law 
 nudum pactum is" defined thus, Nudum pactum est ubi nulla subest 
 causa praeter conventionem ; sed ubi subest causa, fit obligatio, et 
 parit actionem.' In Chitty on Contracts the following passage is cited 
 from the Code Civil: 'L'obligation sans cause, ou sur une fausse 
 cause, ou sur une cause illicite, ne peut avoir aucun effet.' The rent 
 and repairs cannot be said to have been the cause or motive which in- 
 duced the executors to make this agreement. * * * fj^g proviso 
 merely causes the donee to take the gift charged with, the burthen of 
 paying the rent and keeping the : premises in repair ; and she cannot 
 turn these conditions into a consideration." 
 
 Lord Denman, C. J. There is nothing in this case but a great deal of 
 ingenuity, and a little wilful blindness to the actual terms of the in- 
 strument itself. There is nothing whatever to show that the ground 
 rent was payable to a superior landlord ; and the stipulation for the 
 payment of it is not a mere proviso, but an express agreement. (His 
 
Sec. 2) RELIANCE ON A PROMISE AS CONSIDERATION 225 
 
 Lordship here read the proviso.) This is in terms an express agree- 
 ment, and shows a sufficient legal consideration quite independent of 
 the moral feeling which disposed the executors to enter into such a 
 , contract. Mr. Williams's definition of consideration is too large ; the 
 word causa in the passage referred to means one which confers what 
 the law considers a benefit on the party. Then the obligation to repair 
 is one which might impose charges heavier than the value of the life 
 estate. 
 
 Patteson, J. It would be giving to causa too large a construction if 
 we were to adopt the view urged for the defendant ; it would be con- 
 founding consideration with motive. Motive is not the same thing 
 with consideration. Consideration means something which is of some 
 value in the eye of the law, moving from the plaintiff ; it may be some 
 benefit to the defendant, or some detriment to the plaintiff ; but at all 
 events it must be moving from the plaintiff. Now that which is sug- 
 gested as the consideration here, a pious respect for the wishes of the 
 testator, does not in any way move from the plaintiff ; it moves from 
 the testator; therefore, legally speaking, it forms no part of the con- 
 sideration. Then it is said that, if that be so, there is no consideration 
 at all, it is a mere voluntary gift ; but when we look at the agreement 
 we find that this is not a mere proviso that the donee shall take the 
 gift with the burthens; but it is an express agreement to pay what 
 seems to be a fresh apportionment of a ground rent, and which is made 
 payable not to a superior landlord, but to the executors. So that this 
 rent is clearly not something incident to the assignment of the house, 
 for in that case, instead of being payable to the executors, it would 
 have been payable to the landlord. Then as to the repairs, these houses 
 may very possibly be held under a lease containing covenants to repair ; 
 but we know nothing about it, for anything that appears the liability 
 to repair is first created by this instrument. The proviso certainly 
 struck me at first as Mr. Williams p.ut it, that the rent and repairs were 
 merely attached to the gift by the donors; and, had the instrument 
 been executed by the donors only, there might have been some ground 
 for that construction ; but the fact is not so. Then it is suggested that 
 this would be held to be a mere voluntary conveyance as against a sub- 
 sequent purchaser for value ; possibly that might be so, but suppose it 
 would, the plaintiff contracts to take it, and does take it, whatever it is, 
 for better for worse ; perhaps a bona fide purchase for a valuable con- 
 sideration might override it, but that cannot be helped. 
 
 Coleridge, J. The concessions made in the course of the argument 
 have, in fact, disposed of the case. It is conceded that mere motive 
 need not be stated, and we are not obliged to look for the legal consid- 
 eration in any particular part of the instrument, merely because the con- 
 sideration is usually stated in some particular part ; ut res magis valeat, 
 we may look to any part. In this instrument, in the part where it is 
 usual to state the consideration, nothing certainly is expressed but a 
 wish to fulfil the intentions of the testator, but in another part we find 
 
 CORBIN CONT 15 
 
226 , CONSIDERATION (Ch. 2 
 
 an express agreement to pay an annual sum for a particular purpose, 
 and also a distinct agreement to repair. If these had occurred in the 
 first part of the instrument, it could hardly have been argued that the 
 declaration was not well drawn and supported by the evidence. As to. 
 the suggestion of this being a voluntary conveyance, my impression is 
 that this payment of £ 1 annually is more than a good consideration, it 
 is a valuable consideration; it is clearly a thing newly created and not 
 part of the old ground rent. 
 Rule discharged. 
 
 WISCONSIN & M. RY. CO. v. POWERS. 
 
 (Supreme Court of the United States, 1903. 191 TJ. S. 379, 24 S. Ct. 107, 48 
 
 L. Ed. 229.) 
 
 Mr. Justice Holmes delivered the opinion of the court :^'^ 
 This is an appeal from a decree of the United States circuit court, 
 dismissing the plaintiff's bill on demurrer. The bill seeks to enjoin 
 the auditor general of the state of Michigan from collecting a tax, on 
 the~ ground that the law imposing the tax is contrary to the Consti- 
 tution of the United States as impairing the obligation of contracts, 
 and interfering with interstate commerce. 
 
 The alleged contract is contained in a law of May 27, 1893, § 3, 
 which, after levying a specific tax on railroads,, provided "that the rate 
 of taxation fixed by this act or any other law of this state shall not 
 apply to any railway compatiy hereafter building and operating a line 
 of railroad within this state north of parallel forty-four of latitude 
 until the same has been operated for the full period of ten years, un- 
 less the gross earnings shall equal $4,000 per mile, except," etc. After- 
 wards, on October 23, 1893, the Menominee & Northern Railroad Com- 
 pany was incorporated under the laws of the state, and forthwith con- 
 veyed all its property, rights, and franchises to the plaintiff, a Wis- 
 consin corporation which is assumed to stand in the shoes of the 
 Michigan company. The plaintiff thereupon constructed the road. 
 This road is north of parallel forty-four, its gross earnings never have 
 been equal to $4,000 per mile, and it would be entitled to the exemp- 
 tions just stated if the law of 1893 still were in force. But .on June 
 4, 1897, the state passed a law amending the act of 1893, and levying a 
 "specific tax upon the property and business of [every] railroad cor- 
 poration operated within the state," and enacted that "when the railroad 
 lies partly within and partly without this state, prima facie, the gross 
 income of said company from such road for the purposes of taxation 
 shall be on the actual earnings of the road in Michigan, computed by 
 adding to the income derived from the business transacted by said com- 
 pany entirely within this state, such proportion of the income of said 
 company arising from the interstate business as the length of the road 
 
 1' Part of the opinion Is omitted. 
 
Sec. 2) RELIANCE ON A PROMISE AS CONSIDERATION 227 
 
 over which said interstate business is carried in this state bears to 
 the entire length of the road over which said interstate business is 
 carried." This is tlie law which the plaintiff says is unconstitutional 
 for the reasons above set forth. 
 
 The demurrer to the bill was sustained on the ground that the act 
 of 1893 made no valid contract of exemption from taxation, and that 
 the act of 1897, repealing the exemption granted in 1893, was a consti- 
 tutional law. * * * 
 
 The first and main question, then, is whether the act of 1893 pur- 
 ported to make an irrevocable contract with such railroad as might 
 thereafter ccJmply with its terms. The question is pretty well answered 
 by a series of decisions in this court. A distinction between an exemp- 
 tion from taxation contained in a special charter, and general encour- 
 agement to all persons to engage in a certain class of enterprise, is 
 pointed out in East Saginaw Salt Mfg. Co. v. East Saginaw, 13 Wall. 
 2,72,, 20 L. Ed. 611 ; Id., 19 Mich. 259, 2 Am. Rep. 82. In earlier and 
 later cases it was mentioned that there was no counter-obligation, serv- 
 ice, or detriment incurred, that properly could be regarded as a con- 
 sideration for the supposed contract. Christ Church v. Philadelphia 
 County, 24 How. 300, 16 L. Ed. 602 ; Tucker v. Ferguson, 22 Wall. 
 527, 22 L. Ed. 805; Grand Lodge, F. & A. M. v. New Orleans, 166 U. 
 S. 143, 17 Sup. Ct. 523, 41 L. Ed. 951.' See Tomlinson v. Jessup, 15 
 Wall. 454, 459, 21 L. Ed. 204. But whatever the ground, thus far at- 
 tempts like the present to make a contract out of the clauses in a 
 scheme of taxation which happen to benefit certain parties have failed. 
 See further Welch v. Cook, 97 U. S. 541, 24 L. Ed. 1112, and Manistee 
 & N. E. R. Co. v. Commissioner of Railroads, 118 Mich. 349, 76 N. W. 
 633, in which the state court deals with this very act. 
 
 It may be that a state, by sufficient words, might bind itself without 
 consideration, as a private individual may bind himself by recogni- 
 zance or by affixing a seal. A state might abolish the requirement of 
 consideration altogether for simple contracts by private persons, and, it 
 may be that it equally might dispense with the requirement for itself. 
 But the presence or absence of consideration is an aid to construction 
 in doubtful cases, — a circumstance to take into account in determining 
 whether the state has purported to bind itself irrevocably or merely 
 has used words of prophecy, encouragement, or bounty, holding out 
 a hope but not amounting to a covenant. 
 
 In the case at bar, of course the building and operating of the rail- 
 road was a sufficient detriment or change of position to constitute a con- 
 sideration if the other elements were present. But the other elements 
 are that the promise and the detriment are the conventional inducements 
 each for the other. No matter what the actual motive may have been, 
 by the express or implied terms of the supposed contract, the prom- 
 ise and the consideration must purport to be the motive each for the 
 other, in whole or at least in part. It is, not enough that the promise 
 induces the detriment or that the detriment induces the promise, if the 
 
228 CONSIDERATION (Ch. 2 
 
 Other half is wanting. If we are to deal with this proviso in a general 
 tax law as we should deal with an alleged simple contract, while, no 
 doubt, in some cases between private persons the above distinctions have 
 not been kept very sharply in mind (Martin v. Meles, 179 Mass. 114, 
 117, 60 N. E. 397), it is cle'ar that we should require an adequate expres- 
 sion of an actual intent on the part of the state to set change of po- 
 sition against promise before we hold that it has parted with a great 
 attribute of sovereignty beyond the right of change. See Vicksburg, 
 S. & P. R. Co. V. Dennis, 116 U: S. 665, 668, 6 Sup. Ct. 625, 29 L. Ed. . 
 770. Looking at the case in this way, then, we find no such adequate 
 expression. No doubt the state expected to encourage railroad build- 
 ing, and the railroad builders expected the encouragement ; but the two 
 things are not set against each other in terms of bargain. See Coving- 
 ton V. Kentucky, 173 U. S. 231, 238, 239, 19 Sup. Ct. 383, 43 L. Ed. 
 679. 
 
 But this is a somewhat narrow and technical mode of discussion for 
 the decision of an alleged constitutional right. The broad ground in 
 a case like this is that, in view of the subject-matter, the legislatuire is 
 not making promises, but framing a scheme of public revenue and pub- 
 lic improvement. In announcing its policy, and providing for carry- 
 ing it out, it may open a chance for benefits to those who comply with 
 its conditions, but it does not address them, and therefor, it makes no 
 promise to them. It simply indicates a course of conduct to be pur- 
 sued until circumstances or its views of policy change. It would be 
 quite intolerable if parties not expressly addressed were to be allowed to 
 set up a contract on the strength of their interest in, and action on the 
 faith of, a statute, merely because their interest was obvious and their 
 action likely, on the face of the law. 
 
 Decree affirmed. 
 
 BRAWN et al. v. EYFORD. 
 (Supreme Judicial Court of Maine, 1907. 103 Me. 362, 69 Atl. 544.) 
 
 Action by Charles H. Brawn and others against John F. Lyfor^. 
 Case reported. Judgment for defendant. 
 
 Pbabody, J.^^ The defendant on the 31st day of August, 1901, con- 
 veyed to the plaintiffs his farm in St. Albans, in the county of Sbftier- 
 set and state of Maine, and assigned to them his interest in a policy 
 of fire insurance to the extent of the buildings insured, reserving the in- 
 surance on the personal property covered by the policy. 
 
 The policy was to insure $1,350 on the buildings, and $450 on the 
 personal property, for a term of three years, about half of which was 
 unexpired. The premium was $27. 
 
 The defendant did not deliver the deed when it was signed, but did 
 so at his home later in the day when he received the purchase price. 
 
 18 The statement of facts is omitted. 
 
Sec. 2) . EELIANCE ON A PROMISE AS CONSIDERATION 229 
 
 After the deed and assignment were signed the attorney who pre- 
 pared the instruments called attention to the necessity of having the 
 consent of the insurance company to the assignment, and the evidence 
 shows that after conversation on the subject the defendant promised, 
 to send the assigned policy as soon as the deed was delivered by mail 
 to Parks Bros., agents, at Pittsfield, Me., to obtain the assent of the 
 insurance company to the assignment ; that he neglected to do this ; and 
 that on the 7th day of September the buildings were struck by light- 
 ning and wholly destroyed by the resulting fire. 
 
 The plaintiffs seek their remedy by a special, action of assumpsit to 
 recover of the defendant the amount of the insurance on the buildings, 
 $1,350, with interest from September 7, 1901, for the alleged breach of 
 a promise to send the policy to the agents of the company for assent 
 necessary to the validity of the assignment. 
 
 The defendant pleads the general issue, with a brief statement deny- 
 ing the alleged consideration, and alleging that any promise to send the 
 policy to the insurance agents was without consideration and void, and 
 denying also that ^ot sendiiig the policy was the legal cause of the 
 buildings being uninsured, for which he should be held responsible. 
 
 The case is before the law court on report. 
 
 There is some conflict of evidence as to whether in the original trade 
 the $2,000, named as consideration in the deed included an assignment 
 of the unexpired term of the insurance on the buildings. The de- 
 fendant's testimony indicates that the subject came up when the par- 
 ties met to have the deed drawn, but that of the plaintiffs and their 
 witness Katen shows that it was previously agreed that the $2,000 was 
 to be paid for the property and insurance. But this is immaterial, since 
 the trade as consummated was for the farm and insurance on the 
 buildings. 
 
 There is nothing in the nature of the defendant's undertaking to 
 constitute it a part of what was purchased by the plaintiffs. The pay- 
 ment of the consideration and the execution of the deed and assign- 
 ment embraced the whole transaction. We cannot agree with the 
 plaintiffs' theory that the promise of the defendant to send the policy 
 to the agents of the company is based upon the pecuniary considera- 
 tion paid. It was an independent matter. The defendant was under 
 no more obligation to procure the consent of the company to the as- 
 signment than to procure the record of the deed. He volunteered to 
 forward the policy by mail to the agents ; and he claims that his prom- 
 ise was not legally binding, because without consideration. Thome 
 et al. v. Deas, 4 Johns. (N. Y.) 84, upon which he relies, was an ac- 
 tion on the case for the defendant's neglect to fulfill his promise to 
 procure insurance on a vessel owned jointly by himself and the plain- 
 tiff. Chief Justice Kent thus concludes his opinion in which he held 
 that there should be a verdict for the defendant : "A short review of 
 the leading cases will show that by the common law a mandatory. who 
 undertakes to do an act for another without reward is not responsible 
 
230 CONSIDERATION (Ch. 2 
 
 for omitting to do the act, and is only responsible when he attempts 
 to do it and doe's it amiss. In other words, he is responsible for a 
 misfeasance, but not for a nonfeasance, even though special damages 
 be averred." But it was not decided upon the ground that there was no 
 consideration for the alleged promise as consideration was not an ele- 
 ment of that form of the action, but that the defendant had not as- 
 sumed a legal duty by entering upon the execution of his undertaking. 
 The doctrine of this case was reaffirmed in Smedes v. Bank, 20 Johns. 
 (N. Y.) 372, although it was an action of assumpsit ; but the plaintiff 
 seems to have misconceived his remedy. 
 
 New rules have arisen from the development of the action of special 
 asstimpsit from an action on the case for deceit into one for the breach 
 of a parol promise. Since the decision in Rann v. Hughes, 7 T. R. 
 350, note, a consideration for all promises not under seal has been 
 necessary; and consideration is now generally defined as a benefit to 
 the promisor, or a detriment to the promisee. 
 
 In this case the promisor's undertaking was not for any antecedent 
 pecuniary consideration, or. for an anticipsited recompense, but the con- 
 sideration, if any, was a detriment to the promisee. If, under the 
 facts of the case, it may be considered that the plaintiffs, on the faith 
 of the defendant's undertaking, parted with a present right, were de- 
 layed in the present use of a right, or suffered some immediate prej- 
 udice, it would be consideration, provided it was so treated by the 
 parties. 5 Gyc. 168; Harriman on Contracts, §§ 91, 96; Fire Insur- 
 ance Association v. Wickham, 141 U. S. 564, 12 Sup. Ct. 84,, 35 L. Ed. 
 860; Button's Estate, 181 Pa. 426, 37 Atl. 582; Ames v. Taylor, 49 
 Me. 381. 
 
 The defendant claims that the policy remained in his custody; that 
 he retained it because he had an interest under it; and that cofase- 
 quently it cannot be said that the plaintiffs parted with the document, 
 or surrendered any present right, or suffered any prejudice on the 
 faith of the defendant's undertaking. But we do not consider th^t 
 this custody of the policy was inconsistent with the plaintiffs' legal pos- 
 session. They had a right to it until it was presented to the insurance 
 company for assent to the assignment, and they intrusted it to the de- 
 fendant to do what they otherwise would presumably have done them- 
 selves for the protection of their legal rights. By reason of the defend- 
 ant's "assumption" the plaintiffs were delayed in tlie present use of the 
 assigned policy for a purpose recognized as important. 
 
 But the consideration of the assumpsit as "detriment to the promisee" 
 lacks the element of inducement. Fitch v. Snedaker, 38 N. Y. 248, 97 
 Am. Dec. 791. It is true that a motive might be implied from circum- 
 stances ; but it clearly appears that the intrusting of the policy to the 
 defendant was not at his solicitation, and therefore was not the con- 
 sideration of the promise, but a mere condition precedent to the per- 
 formance of the promise. Holmes' Common Law, 291 ; Haigh v. 
 Brooks, 10 Ad. & El 309; Hai-t v. Miles, 4 C. B. N. S. 371. 
 
Sec. 2) RELIANCE ON A PROMISE AS CONSIDERATION 231 
 
 The voluntary promise of the defendant to perform a gratuitous 
 service was nudum pactum, and he cannot be held liable for its nonper- 
 formance as a breach of contract. 
 
 Judgment for the defendant.^" 
 
 CARR et al. v. MAINE CENT. R. R. 
 
 (Supreme Court of New Hampshire, 1917. 78 N. H. 502, 102 All. 5.32, L. E. A. 
 
 1918B, 389.) 
 
 Case for negligence by J. T. Carr and another against the Maine 
 Central Railroad. A demurrer to the declaration was overruled, and 
 defendant brings exceptions. Exceptions overruled. 
 
 Young, J. The defendant bases its demurrer on (1) the nature of 
 the plaintiffs' cause of action, and (2) the character of the agreement 
 they allege it made with them. 
 
 The plaintiffs allege in substance that the defendant charged them 
 more for hauling four cars of pulp wood than they had been accus- 
 tomed to pay, and that when they claimed a rebate, informed them 
 that the rate had been raised by mistake, but that it could not ^llow 
 their claim unless they obtained the assent of the Interstate Commerce 
 Commission ; that if they would execute the necessary papers it would 
 undertake to pi'ocure the assent of the commission to the allowance 
 of their claim ; that they executed the necessary papers and gave them 
 to the defendant, but that it, either negligently or fraudulently, failed 
 to act in the matter until after the time within which the commission 
 could give its consent had expired. The fault with which the declara- 
 tion charges the defendant is its failure to do what the average man 
 would have done if he had undertaken to procure the assent of the 
 commission to the allowance of the plaintiffs' claim ; Jiot its failure to 
 perform a duty imposed on it by the federal statute entitled "An Act 
 to regulate commerce." Act Feb. 4, 1887, c. 104, 24 Stat. 379. In 
 other words, the plaintiffs allege that they have been damaged by the 
 defendant's failure to perform a duty imposed on it by the common 
 law — not a federal statute. Since this (is so there is no merit in the 
 defendant's contention that the courts of this state have no jurisdiction 
 of the plaintiffs' cause of action. 
 
 This also disposes of the defendant's contention that the plaintiffs 
 cannot recover because the agreement they allege it made is one that it 
 could not legally make, and that it had no consideration to support it, 
 for as has already appeared their declaration sounds in tort. In 
 other words, they are not seeking to enforce the agreement they 
 allege the defendant made, but to recover the damages they sustained 
 because of its fraudulent or tjegligent failure to do what the average 
 
 IS See, also, Texas Co. v. Dunn (Tex. Civ. App.) 219 S. W. 300 (1920), where 
 in reliance upon a gratuitous option for 25 days, the offeree paid $25 to an 
 attorney to examine the title. 
 
232 CONSIDERATION (Ch. 2 
 
 man would have done if he had undertaken to. procure the assent of 
 commission to the allowance of their claim. In short, the office of the 
 allegation that the defendant agreed to procure the assent of the com- 
 mission is not to set forth the foundation on which the plaintiffs rest 
 their cause of action, but to show how they came to rely on it to pro- 
 cure the assent of the commission to the allowance of their claim. 
 
 The question therefore and the only question of law raised by the 
 defendant's exception is whether the common law imposes the duty of 
 using average care on those who undertake to perform a service for 
 them. The common law imposes that duty on every member of the 
 community for the benefit of all those with whom he comes in contact, 
 regardless of whe'ther he is or is not to be compensated for his serv- 
 ices. Coggs V. Bernard, 2 Ld. Raym. 909; Edwards v. Lamb, 69 N. 
 H. 599, 45 Atl. 480, 50 L. R. A. 160. 
 
 It follows that if the defendant accepted the papers evidencing the 
 plaintiffs' claim for the purpose of forwarding them to the com- 
 mission, it then and there became its duty to do what the average man 
 would do in that situation. Pittsfield, etc., Mfg. Co. v. Pittsfield Shoe 
 Co., 71 N. H. 522, 533, 53 Atl. 807, 60 L. R. A. 116. In other words, 
 notwithstanding the defendant owed the plaintiffs no duty in respect 
 to procui'ing the assent of the commission to the allowance of their 
 claim, still when it undertook to perform that service for them the 
 law then and at that instant imposed on it the duty of doing what the 
 average man would do in that situation, and it is no answer to an ac- 
 tion to recover damages caused by its failure to perform that duty to 
 show that it was not to be paid for what it undertook to do. Coggs 
 V. Bernard, 2 Ld. Raym. 909. 
 
 If, therefore, the plaintiffs show that the defendant accepted the 
 papers evidencing their claim for the purpose of forwarding them 
 to the commission, and then did or omitted to do something the av- 
 erage man wouln not have done or omitted, they can recover all the 
 damage they sustained as the result of such failure, provided no fault 
 of theirs contributed to produce their loss. 
 
 Defendant's exception overruled. All concurred.^" 
 
 KIRKSEY V. KIRKSEY. 
 
 (Supreme Court of Alabama, 1845. 8 Ala. 131.) 
 
 Assumpsit by the defendant, against the plaintiff in error. 
 
 The plaintiff was the wife of defendant's brother, but had for some 
 
 time been a widow, and had several children. In 1840, the plaintiff 
 
 resided on public land, under a contract of lease, she had held over, and 
 
 was comfortably settled, and would have attempted to secure the 
 
 land she lived on. The defendant resided in Talladega county, some 
 
 ^0 See, also, Fooly & Preston's Case, 1 Leon. 297 (1586), ante, p. 211 and 
 Wheatley v. Low, Cro. Jac. 668 (1623)', ante, p. 212. 
 
Sec. 2) EELIANCE ON A PROMISE AS CONSIDERATIOX 233 
 
 sixty or seventy miles off. On the 10th October, 1840, he wrote to her 
 the following letter: 
 
 "Dear Sister Antillico, — Much to my mortification, I heard that 
 brother Henry was dead, and one' of his children. I know that your 
 situation is one of grief and difficulty. You had a bad chance before, 
 but a great deal worse now. I should like to come and see you, but 
 cannot with convenience at present. * * * I do not know whether 
 you have a preference on the place you live on or not. If you had, 
 I would advise you to obtain your preference, and sell the land and 
 quit the country, as I understand it is very unhealthy, and I know 
 society is very bad. If you will come down and see me, I will let you 
 have a place to raise your family, and I have more open land than 
 I can tend ; and on the account of your situation, and that of your fam- 
 ily, I feel like I want you and the children to do well." 
 
 Within a month or two after the receipt of this letter, the plaintiff 
 abandoned her possession, without disposing of it, and removed with 
 her family, to the residence of the defendant, who put her in com- 
 fortable houses, and gaveJier land to cultivate for two years, at the 
 end of which time he notified her to remove, and put her in a house, 
 not comfortable, in the woods, which he afterwards required her to 
 leave. 
 
 A verdict being found for the plaintiff, for $200, the above facts were 
 agreed, and if they will sustain the action, the judgment is to be af- 
 firmed, otherwise it is to be reversed. 
 
 Ormond, J. The inclination of mj' mind is that the loss and incon- 
 venience which the, plaintiff sustained in breaking up' and moving to 
 ,the defendant's a ,distance of sixty miles is^ a sufficient consideration to 
 support the promise to furnish her with a house and land to cultivate 
 until she could raise her family. My brothers, however, think that the 
 promise on the part of the defendant was a mere gratuity, and that an 
 action will not lie for its breach. 
 
 The judgment of the court below must therefore be. reversed, pur- 
 suant to the agreement of the parties. ^^ 
 
 "See, in accord: liunshee v. Dunshee, 255 111. 296; 99 N. E. 593 (1912) ; 
 Brevator y. Creech, 1S6 Mo. 558, 85 S. W. 527 (1905). 
 
 In Richards' Ex'r v. Richards, 46 Pa. 78, 82 (1863), Lowrie, O. J., said: "No 
 doubt there is evidence that the testator said he would pay that balance, and 
 that he drew up notes that would have held him to it, if they had been passed 
 as at first intended ; but they were given up and destroyed, and therefore go 
 for nothing, and the securities actually given do not hold him. We have 
 nothing, therefore, but his advice to the plaintiff to buy the farm, and not 
 move to the West, accompanied with an assurance that he would furnish hiro , 
 with the balai;ice of the purchase-money. But this does not make a legal con- 
 tract. Assurances of assistance accompanying kind advice are never intended 
 as contracts. And conformance to advice is never intended to stand as a 
 legal consideration for the kind assurances that accompany the advice, though 
 it is a motive for their fulfillment. It would be exceedingly hurtful to the 
 freedom of social intercourse to create even a suspicion in the public mind, 
 that those kind offers of advice and assistance, which take place among 
 friends and kindred, cquld be converted into contracts which the law would 
 enforce., 
 
234 CONSIDERATION (Cll. 2 
 
 DEVECMON V. SHAW. 
 
 (Court of Appeals of Maryland, 1888. 69 Md. 199, 14 Atl. 464, 9 Am. St. 
 
 Rep. 422.) 
 
 Bryan, J. John Semmes Deyecmon brought suit against the execu- 
 tors of John S. Combs, deceased. He declared on the common counts, 
 and also filed a bill of particulars. After judgment by default, a jury- 
 was sworn to assess the damages sustained by the plaiiitiff . The evi- 
 dence consisted of certain accounts taken from the books of the de- 
 ceased,, and testimony that the plaintiff was a nephew of the deceased, 
 and lived for several years in his family, and was in his service as 
 clerk for several years. The plaintiff then made an dffer of testimony 
 which is thus stated in the bill of exceptions : "That the plaintiff took 
 a trip to Europe in 1878, and that said trip was taken by said plain- 
 tiff, and the money spent on said trip was spent by the said plaintiff, at 
 the instance and request of said Combs, and upon a promise from him 
 that he would reimburse and repay to tHe plaintiff all money expended 
 by him in said trip ; and that the trip was so taken, and the money so 
 expended, by the said plaintiff, but that the said trip had no connection 
 with the business of said Combs ; and that said Combs spoke to the 
 witness of his conduct, in being thus willing to pay his nephew's ex- 
 penses, as liberal and generous on his part." On objection th^ court 
 refused to permit the evidence to be given, and the plaintiff excepted. 
 
 It might very well be, and probably was the case, that the plaintiff 
 would not have taken a trip to Europe at his own expense. But, wheth- 
 er this be so or not, -the testimony would have tended to show that 
 the plaintiff incurred expense at the instance and request of the de-' 
 ceased, and upon an express promise by him that he would repay the 
 money spent. It was a burden incurred at the request of the other 
 party, and was certainly a sufificient consideration for a promise to 
 pay. Great injury might be done by inducing persons to make expendi- 
 tures beyond their means, on express promise of repayment, if the law 
 were otherwise. It is an entirely different case from a promise to make 
 another a present, or render him a gratuitous service. It is nothing 
 to the purpose that the plaintiff was benefited by the expenditure 
 of his own money. He was induced by this promise to spend it in 
 this way, instead of some other mode. If it is not fulfilled, the ex- 
 penditure will have been procured by a false pretense. 
 
 As the plaintiff, on the theory of this evidence, had fulfilled his part 
 of the contract, and nothing remained to be done but the payment of 
 the money by the defendant, there could be a recovery in indebitatus 
 assumpsit, and it was not necessary to declare on the special contract. 
 The fifth count in the declaration is for "money paid by the plaintiff 
 for the defendants' testator in his life-time, at his request." In the 
 bill of particulars we find this item: "To cash contributed by me, 
 j. Semmes Devecmon, out of my own money, to defray my expenses 
 
- Sec. 2) RELIANCE ON A PROMISE AS CONSIDERATION ■ 235 
 
 to Europe and return, the said John S. Combs, now deceased, having 
 promised me in 1878 'that, if I would contribute part of my own mon- 
 ey tov^ards the trip, he would give me a part of his, and would make 
 up to me my part,' and the amount below named is my contribution, 
 as follows," etc. It seems to us that this statement is a sufficient de- 
 scription of a cause of action covered by the general terms of the 
 fifth count. The evidence ought to have been admitted. 
 
 The defendants offered the following prayer, which the court 
 granted : 
 
 "The defendants, by their attorneys, pray the court to instruct the 
 jury that there is no sufficient evidence in this case to entitle the plain- 
 tiff to recover the interest claimed in the bill of particulars marked 'Ex- 
 hibit No. 1, Bin of Particulars.' " 
 
 The only evidence bearing on this question is the account taken 
 from the books of the deceased, which was offered in evidence by the 
 plaintiff. This account showed on its face a final settlement of all 
 matters embraced in it. In the absence of proof showing errors of 
 some kind, the parties must be concluded by it in all respects. We 
 think the prayer was properly granted. * 
 
 Judgment reversed, and new trial ordered.^^ 
 
 22 In accord: ToUng v. Boyd, 107 Md. 449, 69 Atl. 33 (1908), plaintiff at- 
 tended a school "at the Instance of the defendant and upon a promise by the 
 defendant" to pay expenses ; Bigelow v. Bigelow, 95 Me. 17, 49 Atl. 49 (1901), 
 uncle promised nephew a farm if he would give up his work and move to the 
 farm. 
 
 Where a promise is made subject to an express condition, the fulfillment of 
 which requires action or forbearance by the promisee, the fulfillment of the 
 condition will usually be held to be sufiicient consideration. See Traver v. 
 , 1 Sid. 57 (1661); Wild v. Harris, 7 C. B. 999 (1849); Millward v. Lit- 
 tlewood, 5 Exch. 775 (1850); Brooks v. Ball, 18 Johns. (N. T.) 337 (1820); 
 Wigan V. Eng., etc., Life Ass. Ass'n, [1909] 1 Ch. 291, 298, semble, "ex post 
 facto consideration" ; Dunton v. Dunton, 18 Vict. L. R. 114 (1892) ; ShadweU 
 V. Shadwell, 30 L. J. C. P. 145 (1860) ; Eicketts v. Scothorn, 57 Neb. 51, 77 
 N. W. 365, 42 L. K. A. 794, 73 Am. St. Rep. 491 (1898) ; State ex rel. Lat- 
 tanner v. Hills, 94 Ohio St. 171, 113 N. E. 1045, L. R. A. 1917B, 684, and note 
 (1916) ; Union Bank of Brooklyn v. Sullivan, 214 N. T. 332, 108 N. E. 558 
 (1915) ; De Cicco v. Schweizer, 221 N. Y. 431, 117 N. E. 807, L. R. A. 1918B, 
 1004, Ann. Cas. 1918C, 816 (1917) ; State B^nk of Pittsburg v. Kirk, 216 Pa. 
 452, 65 Atl. 932 (1907) ; Skordal v. Stanton, 89 Minn. 511, 95 N. W. 449 (1903) ; 
 Hay v. Fortier, 116 Me. 455, 102 Atl. 294 (1917); Jamieson v. Renwick,' 17 
 Vict. Jj. R. 124 (1891). 
 
 See, further, the cases on Irrevocable Offers, ante, pp. 189-203. 
 
 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 proin- 
 ise." Messiah Home for Children in City of New York v. Rogers, 212 N. Y. 
 315, 106 N. E. 59 (1914) ; Freeman v. Freeman, 43 N. Y. 34, 3 Am. Rep. 
 657 (1870) ; Seavey v. Drake, 62 N. H. 393 (1882) ; Neale v. Neales, 76 U. S. 
 (9 Wall.) 1, 19 L. Ed. 590 (1869) ; 1 Ames, Cases Eq. 306, 308, citing many 
 cases in notes. 
 
236 CONSIDERATION (Ch. 2 
 
 UNDERWOOD TYPEWRITER GO. v. CENTURY REALTY CO. 
 
 (Supreme Court of Missouri, 1909. 220 Mo. 522, 119 S. W. 400, 25 L. E. A. 
 
 [N. S.] 1173.) 
 
 Lamm, J.^' This case is here from the St. Louis Court of Appeals on 
 the dissent of Judge Bland. 118 Mo. App. 197, 94 S. W. 787. The 
 majority opinion of that court reversed the judgment of the circuit 
 court sustaining a demurrer to the petition, and remanded the v.ase to 
 be tried on its merits. We think the majority opinion is soundly rea- 
 soned on both principle and precedent. It should be read in connec- 
 tion with this ; for we shall not restate its reasoning, but rest content 
 with adopting it, only supplying a sufficient statement here to make this 
 opinion intelligible, and adding some observations of our own. 
 
 The statement : Plaintiff was tenant of defendant in possession un- 
 der a written lease for a five-year term beginning on the 1st day of 
 February, 1901, and ending on the last day of January, 1906. The lease 
 provided, inter alia, that plaintiff could not assign or underlet without 
 the written^ consent of defendant indorsed bn it. Thereafter, plaintiff 
 and defendant entered into a written agreement to the effect that de- 
 fendant would give its written assent to an assignment of the lease to 
 an acceptable tenant. The petition pleads the lease, the provision 
 against assigning or subletting, and the subsequent written agreement 
 to give consent in writing to an acceptable tenant; and then states, in 
 substance, that plaintiff, in reliance on said written agreement, with 
 the knowledge of defendant, expended a large amount of time and la- 
 bor in securing an acceptable and satisfactory tenant, and did secure 
 such tenant, but that, notwithstanding that fact, defendant refused and 
 still refuses to consent to the assignment of said lease and to permit 
 said tenant to enter into the possession of said premises, though often 
 requested to do so ; that by reason of defendant's refusal to consent to 
 said assignment of said lease plaintiff was and is prevented by defend- 
 ant from securing such tenant at a large advance over the rent reserv- 
 ed by defendant under said lease, to its damage in the sum of $4,500. 
 Wherefore, etc. The circuit court sustained a general dernurrer to the 
 petition. Thereat plaintiff stood on its petition, and, refusing to plead 
 over, judgment went on the demurrer. From that judgment plaintiff 
 appealed to the court of appeals, with the result indicated. When the 
 case came here it was assigned to Division 1, and there argued and sub- 
 mitted. That division was evenly divided, and the cause came into 
 banc. So much by way of statement. 
 
 The observations : True, the typewriter company was not bound to 
 do anything under the written agreement. True, it was executory only, 
 and may be called in a sense a nude pact as born. True, defendant 
 realty company could at no time have sued, the typewriter company on 
 
 2 3 Parts of the two opinions are omitted. 
 
Sec. 2) RELIANCE ON A PROMISE AS CONSIDERATION 237 
 
 that agreement for failure to perform. Why should it sue? It already 
 had a tenant in the person of the typewriter company. It wanted no 
 other. But mutuality, in its essence, is but a phase, strictly speaking, 
 of the consideration that will support a coritract. It is not the only 
 phase. If mutuality, in a broad sense, was held to be an essential ele- 
 ment in every valid contract, to the extent that both contracting par- 
 ties could sue on it, there could be no such a thing as a valid unilateral 
 •or option contract, or a contract evidenced by a subscription paper, or 
 a contract to enforce a reward offer, or a guaranty, or in many other 
 instances readily put in ordinary business affairs. The contract sued 
 on in this case was made for the benefit of the typewriter company. 
 It could furnish an acceptable tenant to defendant to take its place, or 
 let it alone. In that respect it does not differ from many contracts, the 
 "breach of which is actionable at the option of the promisee. 
 
 Being in writing, and signed by the party to be charged, it was not 
 obnoxious to the statute of frauds. Being fully performed by the 
 promisee, it was no longer a nude pact, but became clothed with a con- 
 sideration executed on request. That performance, on the strength of 
 the offer made, having been accomplished at an outlay of time and la- 
 bor on the part of the offeree or promisee, with defendant's knowledge 
 as alleged in the petition, makes it enforceable against the offerer or 
 promisor so long as both parties were capable of contracting and their 
 contract be not vitiated by fraud or as against good morals or public 
 policy. 
 
 We take it as good doctrine worthy of all acceptance that it is the 
 primary duty of courts to enforce contracts, not to abrogate them. A 
 contract (such as this) between two parties not in fiduciary relation, but 
 dealing at arm's length, free from taint of fraud, duress, or other form 
 of overreaching or oppression, when performed by the promisee, 
 comes into a court of justice entitled to every fair presumption of va- 
 lidity. Such a contract bespeaks, in the first instance, judicial dili- 
 gence and astuteness to support the act of the party by the act and art 
 of the law. To that extent, at least, those fine rules of personal honor 
 obtaining between man and man, requiring one to keep his word with 
 another, accord with the rules of law. 
 
 It is afield to point to the contract word "acceptable," and say that it 
 would be. illusory or unthinkable to suppose that its terms could be com- 
 plied with by the plaintiff by its furnishing a tenant acceptable to the 
 landlord. As to whether a landlord could stand on mere whim and ca- 
 iprice or some fanciful conceit in rejecting a party furnished by his 
 tenant, under the contract sued on and the lease out of which it grew, 
 we need not inquire. It is likely his refusal would have to stand on 
 something better than mere caprice and whim. It is likely the law 
 would compel such landlord to acquit himself by acting with reason, 
 and that courts would hold that the contract implied he would so act. 
 But in this case, as pointed out in the majority opinion in the court of 
 .appeals the petition says that the patty furnished was acceptable. The 
 
238 CONSIDERATION (Ch. 2 
 
 demurrer assumes that allegation true ; hence, for present purposes, it 
 is true. 
 
 Discussing the question of mutuality, a law-writer, whose views are 
 fortified by the weight due to a virile and a luminous mind, enriched 
 with great research and strengthened by a profound grasp of legal 
 principles, lays down the right doctrine to be: "But if, without any 
 promise whatever, the promisee does the thing required, then the 
 promisor is bound on another ground. The thing done is itself a^suffi- 
 cient and a completed consideration; and the original promise^o do 
 something, if the other party would do something, is a continuing 
 promise until the other party does the thing required of him. A very 
 large proportion of' our most common contracts rest upon this princi- 
 ple." 1 Parsons on Contracts (9th Ed.) bottom p. 488. 
 
 In a learned note to American Cotton Oil Co. v. Kirk, 15 C. C. A. 
 543, Mr. Clark, author of Clark on Contracts, in speaking to ihe point, 
 says : "Again, contracts may be formed by the offer of a promise for 
 an act and acceptance by performing the act, as where a man requests 
 another to perform services for him, and the latter does so. The re- 
 quest is an offer of a promise to pay for the services, and perform- 
 ance of the services is an acceptance of the offer. This is described 
 as consideration executed upon request. Here, also, the act of one 
 party forms the consideration which supports the promise of the other. 
 In these two cases one of the parties, in the formation of the contract, 
 does all that he can be required to do, and there remains an outstand- 
 ing obligation on the other side only. The contract is unilateral. It is 
 obvious that in these cases the question of mutuality of obligation or 
 contract cannot arise. The question is whether the act is such as to 
 supply a consideration for the promise of the other party." 
 
 To illustrate, if Roe writes Doe: "If you loan L,owe your Jersey 
 cow, I will see she is returned in good order." . And, if Doe (relying) 
 loan her to Lowe and she is not returned in good order, is Roe not li- 
 able to Doe ? 
 
 If Box write Cox : "If you find ijiy lost horses, Bucephalus and Ro- 
 sinante, I will release the debt of $50 you owe me." And if Cox (re- 
 lying) find and return Bucephalus and Rdsinante, is his debt not paid 
 to Box ? 
 
 If Smith agree in writing with Jehu that he will pay him $100 if he 
 drive from Jefferson City to Kansas City and return in four days, and 
 Jehu presently (relying) drives it in four days, is not Smith liable? 
 
 If John agree in writing with Gambrinus that if the latter will not 
 drink beer for a year he will pay him a sum certain, and if Gambrinus 
 (relying) drink no beer for that year, is not John bound ? 
 
 Yet in each of these cases neither Doe, Cox, Jehu, nor Gambrinus 
 was bound to do anything. In each of them there was no considera- 
 tion other than acceptance by actual performance on request. In the 
 last two and the first no benefit accrued to Roe, Smith, or John. But in 
 feach of them there was a consideration (i. e., performance) moving 
 
Sec. 2) RELIANCE ON A PROMISE AS CONSIDERATION 239 
 
 from the promisee in the form of labor done and inconvenience and 
 detriment suffered. 
 
 In an old case, Lindell v. Rokes, 60 Mo. 249, 21 Am. Rep. 395, Rokes 
 agreed to pay L,indell $50 if he would not use intoxicating liquors and 
 beer for one year. Lindell performed. Rokes refused to pay, and, be- 
 ing sued, set up a want of consideration as a defense. * * :i=^ The 
 case was put on the reason of the thing, and the law was declared to 
 be that: "It is true that the plaintiff did not undertake, in direct 
 terms, to do anything when the note was made; but the prevailing 
 doctrine now is that if one promise to pay another a sum of money if 
 he will do a particular act, and he does the act, the contract is not void 
 for want of mutuality, and the promisor is liable, though the promisee 
 did not at the time of the promise engage to do the act ; for upon the 
 performance of the condition by the promisee the contract becomes 
 clothed with a valid consideration, which relates back and renders the 
 promise obligatory." * * * 
 
 In another case (Williams v. Jensen, 75 Mo. 681), Stonebreaker, as 
 principal, and Jensen, as surety, executed a note to Williams. Being 
 sued on the note, Jensen contended he was released from liability on 
 two grounds. One of them was an extension of time to the principal by 
 a valid contract without his consent. It was held that the contract to 
 extend was valid as supported by a sufficient consideration, hence Jen- 
 sen was discharged as surety. The consideration for the extension 
 agreement arose in this way : When the note was about due, Williams 
 . agreed with Stonebreaker he would extend the time to a date certain if 
 Stonebreaker would get his wife to sign the note. Stonebreaker pro- 
 cured this to be done without his surety's knowledge or consent. The 
 signature of Mrs. Storlebreaker was worthless, as the law then stood, 
 she being a married woman with no separate estate, and Williams con- 
 tended there was no consideration for the extension agreement. But 
 this court, disallowing that contention, said: "Whatever may have 
 been his motive, he agreed to extend the time of payment upon the 
 condition that her husband would obtain her signature to the note ; 
 and the obtainraent of her signature, though such signature be of no 
 value to Williams, constitutes a sufficient consideration for his agree- 
 ment to extend the time of payment. It is not always necessary that 
 the consideration for a promise should be of some value to the prom- 
 isor. Damage pr inconvenience to the prornisee is a sufficient consider- 
 ation, and where the court can see that there may have been such in- 
 convenience it will uphold the contract. It may have been a:n incon- 
 venience for Stonebreaker to secure the sigiiature of his wife, and, 
 thus much appearing, the law will shut its eyes to the inequality be- 
 tween the consideration and the promise." At this point the court cites 
 Lindell v. Rokes, supra. Continuing, the court said: "In Brooks v. 
 Ball, 18 Johns. (N. Y.) 337, a promise to pay a certain demand if the 
 claimant would swear to its correctness was enforced. Any trouble or 
 labor, however slight, undertaken by one person at the request of an- 
 
240 CONSIDERATION (Ch. 2 
 
 Other, will support a promise by such other person, although the trou- 
 ble or labor be of no benefit to the promisor. Addison on Contracts 
 (Morgan's Ed.) § 9; Clark v. Sigoumey, 17 Conn. 511. Being of opin- 
 ion that the agreement to extend the time of payment was supported 
 by a sufficient consideration, the judgment, which was for the defend- 
 ant, will be affirmed." 
 
 In a late case in banc (Strode v. Transit Co., 197 Mo. loc. cit. 622 et 
 seq., 95 S. W. 851, 7 Ann. Cas. 1084) to which we all agreed, our 
 Brother Graves reviewed authorities and case learning on the question 
 of consideration, and announced the right doctrine to be, as laid down 
 in 6 Am. & Eng. Ency. of Law (2d Ed.) p. 689, viz., "If the promisee 
 do any act to his injury, however slight, at the request of the prom- 
 isor, either express or implied, the detriment sustained operates as a 
 consideration." 
 
 Barclay, J., in Trustees of Christian Univ. v. Hoffman, 95 Mo. App. 
 loc. cit. 495, 69 S. W. 475, with the concurrence of all his learned 
 brethren, said : "But, apart from the inference of law arising under 
 the above-mentioned statute" {Rev. St. 1899, § 894, supra), "it has 
 been held that where such a promise as that under review has been 
 made to an institution like that of the plaintiffs, and, before the prom- 
 ise is withdrawn, obligations have been created or expenses incurred 
 by the promisee upon the faith of the promise, these facts furnish a 
 consideration to support the original agreement, although in the first 
 instance, it may have partaken somewhat of the nature of a gift. Koch 
 V. Lay, 38 Mo. 147 ; Pitt v. Gentle, 49 Mo. 74 ; Corrigan v. Detsch, . 
 61 Mo. 290; School District v. Sheidley, 138 Mo. 672, 40 S. W. 656, 
 37 L. R. A. 406, 60 Ana. St. Rep. 576." See, also, authorities collected 
 in the principal opinion, 118 Mo. App. 197, 94 S. W. 787, and there 
 applied. 
 
 But I have pursued the matter further than intended. The upshot of 
 it all is the conclusion that the petition was good and the demurrer bad. 
 Hence, the judgment of the circuit court should be reversed, and the 
 cause remanded to be tried on its merits. It is so ordered.^* 
 
 Gantt, Fox, and Graves, JJ., concur. 
 
 21 The opinion of the lower court contained the following language: "It Is 
 true that In such agreements, which at first are Insufficient by reason of the 
 want of the very essential element of every valid contract, sufficient consid- 
 eration and mutuality, the promisor can, if he sees fit, revoke and recall the 
 proinise at any time prior to the' promisee having moved toward its fulfill- 
 ment and expended time, labor or money and inconvenience himself there- 
 about, for up to that time nothing having been done thereunder, by the prom- 
 isee, it will remain a nude pact and is not obligatory. Andreas v. Holcombe, 22 
 Minn. 339 (1876). But if the promise is permitted to stand and with the 
 knowledge of the promisor, the promisee expends time, labor or money, or 
 otherwise inconveniences himself or forfeits any legal rights, relying upon the 
 faith of the promise, the element of consideration and mutuality is thereby 
 supplied as of the date of the agreement and the contract at once becomes 
 enforceable at law. It appears from the allegations of the petition that al- 
 though the defendant was under no obligation to make the promise, and al- 
 though it received no recompense fOr so doing, that nevertheless it did promise- 
 
Sec. 2) RELIANCE ON A PEOMISE AS CONSIDERATION 241 
 
 Woodson, J. (dissenting). * * * in the case at bar the promise 
 of respondent to permit appellant to assign the lease was unilateral,, 
 and was without consideration of any kind to support it. The appel- 
 lant never at any time, even down to the time of bringing this suit, 
 agreed to find or furnish respondent a suitable tenant ;- and if appel- 
 lant had at any time, or even now should withdraw its tender of such 
 tenant, clearly the respondent would have no cause of action against 
 the former for said refusal or withdrawal, for the obvious reason that 
 it never agreed to do so. According to the allegations of the petition,, 
 the appellant was under no legal or moral obligation to find for re- 
 spondent a suitable tenant for the occupancy of the floor space in ques- 
 tion. 
 
 For the purpose of illustration, let us suppose a farmer should enter 
 a shoe store and ask the proprietor thereof if he would take a cord of 
 hickory wood for a certain designated pair of shoes, and in reply there- 
 to the proprietor should say, "Yes," and without more the farmer 
 should turn and walk from the store without agreeing to take the shoes 
 or to furnish the wood, and he should then return home and chop a 
 cord of hickory wood, load it upon his wagon, haul it to town, drive up 
 to the store, and say to the proprietor that he had chopped the wood, 
 hauled it in for him, and demand the shoes in consideration of and in 
 payment for the wood ; and in reply thereto suppose the merchant had 
 said to the farmer that he was sorr}', but he could not deliver the shoes- 
 to him, for the reason that he had sold them during the time which had 
 elapsed between the first conversation and the time when the wood was 
 hauled to town and tendered to the merchant — could it be seriously 
 contended that the farmer would have a cause of action against the 
 merchant for breach of contract for his failure to deliver the shoes? 
 I think not, for the reason the farmer never agreed to take the shoes, 
 or to cut, haul, and deliver the wood in exchange for them. Such a 
 contract, if it may be so called, would dearly be unilateral in character, 
 and the subsequent tender of the wood would not change the agreement 
 into a bilateral contract. The tender of the wood* could not perform 
 
 in writing to the plaintiff as alleged. No doubt this promise was purely a 
 matter of accommodation to the plaintiff, but it appears that the promise was 
 permitted to stand unrevoked and unrecalled when the defendant had the clear 
 right to recall it for want of EQutuallty and consideration, and that the plain- 
 tiff, relying upon the faith of the promise, which he had a right to do, pro- 
 ceeded and with knowledge of the defendant, expended a large amount of time 
 and labor in securing an acceptable and satisfactory tenant. Under the cir- 
 cumstances stated, a majority of the court are of the opinion that a sufficient 
 consideration and mutuality was imported into the agreement by such per- 
 formance, which related back to its origin and rendered it a contract valid 
 in law, and affixed a mutual obligation on the defendant to respond." 
 
 In Spitzli v. Guth, 112 Misc. Bep. 630, 183 N. Y. Supp. 743 (1920), a lessor 
 gave an option to his lessee for the purpose of protecting the latter in case 
 he made valuable improvements. Such improvements were made, after which 
 the lessor give notice of revocation. The lessee accepted in spite of such no- 
 tice and obtained a decree for specific performance. See, also, "Power of Rev- 
 ocation," ante, chapter I, section 9, and note to Vickrey v. Maier, post, p. 311.. 
 
 CORBIN CONT. — 16 
 
242 CONSIDERATION (Ch. 2 
 
 the twofold office of furnishing a consideration for the contract, and at 
 the same time constitute an agreement to accept the shoes, which, had 
 never been done before. And the same is true as regards the case at 
 bar. The finding of a suitable tenant could not perform the twofold 
 function of furnishing a consideration to support the promise of tlk 
 Century Realty Company to agree to subletting of the floor space to 
 such tenant, and at the same time constitute an agreement on the part 
 of the typewriter company to furnisih such tenant, which, confessedly, 
 it has never done down to this date in any mode or manner whatsoever. 
 
 The principle announced "in the majority opinion is too far-reaching 
 and startling in its effect. Under that holding no merchant or proper- 
 ty owner could safely answer a question as to what he would take for 
 a certain article or piece of property; for, if he should do so, he would 
 be liable at any time within the period prescribed by the statute of 
 frauds to be called upon to deliver the property to the party who asked 
 the question, and be subjected to an action for damages for breach of 
 contract for failure to deliver the property, if for any reason he should 
 see proper to decline to deliver it, even though he had disposed of it in 
 the meantime. * * * 
 
 I am, therefore, of the opinion that the; action of the trial court in 
 sustaining the demurrer to the petition was proper, and that the judg- 
 ment of the St. Louis Court of Appeals reversing the judgment of the 
 circuit court is erroneous. 
 
 VAtuANT, C. J., and Burgess, J., concur. 
 
 YOUNG MEN'S CHRISTIAN ASS'N v. ESTILL et al. 
 
 (Supreme Court of Georgia, 1913. 140 Ga. 291, 78 S. E. 1075, 48 L- R. A. 
 [N. S.] 783, Ann. Gas. 1914D, 136.) 
 
 Action by the Young Men's Christian Association against M. H. 
 Estill and otliers, ^xecutors. Judgment for defendants,' and plaintiff 
 brings error. Reversed. 
 
 The Young Men's Christian Association, a corporation, brought suit 
 against the executors of J. H. Estill to recover an amount alleged to be 
 due on a verbal contract to give $500 for the construction of a builds 
 ing to be devoted to the general purposes of the plaintiff corporation. 
 * * * On April 21, 1905, W. B. Stubbs and J. B. Reid, represent- 
 ing the plaintiff, solicited from Mr. Estill a subscription for the con- 
 struction of the building. Mr. Estill agi'eed to subscribe and did sub- 
 scribe $500, and the following memorandum was made on a card at 
 the tihie: "Will give $500 as soon as work begins." This memoran- 
 dum was not signed by Mr. Estill, and the subscription was verbal. 
 Subscriptions were made by others for the same purpose, prior and 
 subsequent to the promise of Mr. Estill, all of which were mutual sub- 
 scriptions for the common object; and because of the subscriptictis 
 
Sec. 2) RELIANCE ON A PROMISE AS CONSIDERATION 243 
 
 made by Mr. Estill and others the work was undertaken by the plain- 
 tiff. The contract was given out and the work, completed a.i a very 
 large expense ; and if the subscriptions had not been made by Mr. Es- 
 till and others, the work would not have been undertaken by 'the plain- 
 tiff. * * * The contract for the erection of the building was let 
 on April 24, 1907, and the work was begun on June 3, 1907, and on the 
 last-mentioned day the subscription became due and payable. On No- 
 vember 9, 1^07, Mr. Estill died, and on November 12, 1907, his will 
 was duly probated and letters testamentary issued to his executors. 
 The executors refuse, to pay the subscription of Mr. Estill to. the plain- 
 tiff and judgment is prayed for the sum of $500, the amount of the 
 subscription, with interest thereoii from June 3, 1907. The court sus- 
 tained a demurrer to the petition and dismissed it.^^ 
 
 Evans, P. J. * * * 
 
 The Young Men's Christian Association is a charitable corporation, 
 and its directors determined to erect in the city of Savannah a large 
 building for the advancement of the cause represented by it, which was 
 entirely charitable and benevolent. Several persons subscribed in writ- 
 ing, promising to give named sums of money for the accomplishment 
 of the enterprise. When Mr. Estill was solicited for a subscription, he 
 promised to give $500 for the work as soon as the work of con- 
 structing the building began. The local newspaper owned and pub- 
 lished by a company of which he was the chief, if not the only, stock- 
 holder, and managed by him, published a list of the subscribers, 
 which included his name among the rest as subscribing the amount 
 which he had orally promised to give. The building was completed 
 at great expense, in reliance upon the subscriptions of promises of 
 Mr. Estill and others. Work began upon the building more than 
 six months before the death of Mr. Estill, and has been fully complet- 
 ed. Mr. Estill never withdrew or repudiated his promise to pay the 
 amount he promised to donate. His executors deny the binding force 
 of his promise to donate $500 to the enterprise. The conteiition is that 
 a promise to donate a named sum to a charitable purpose is purely 
 gratuitous and unenforceable, for want of a consideration. If Mr. Es- 
 till had signed a subscription contract with others to erect this building, 
 the mutual promises of the subscribers would have furnished a good 
 consideration. Our Code declares that "in mutual subscriptions for a 
 common object the promise of the others is a good consideration for 
 the promise of each." Civil Code, § 4246. This section has been held 
 applicable to subscriptions to build churches, and to locate assembly 
 grounds of a.- religious denomination at a particular point. Wilson v. 
 First Presbyterian Church, 56 Ga. 554; Owenby v. Georgia Baptist 
 Assembly, 137 Ga. 698, 74 S. E. 56, Ann. Cas. 1913B, 238. The pe- 
 tition alleges that other subscriptions were made by other persons be- 
 
 2 5 The statement of facts Is abbreviated and part of the opinion is omitted. 
 
:244 CONSIDERATION (Ch. 2 
 
 fore and after Mr. Estill's promise to give $500, and that all of them, 
 includihg Mr. Estill's verbal promise, were mutual subscriptions for 
 the common object. Notwithstanding this allegation, we do not think 
 the case in hand comes within the Code section quoted. That section 
 has application to mutual subscriptions, which means written promises 
 mutually entered into by the subscribers, The statute is not sufficient- 
 ly broad to include oral promises, and cannot be extended so as to cov- 
 er the promise in the case at bar. 
 
 A promise to donate money to a charitable purpose is gratuitous 
 and unenforceable, unless some consideration therefor exists. Such 
 a promise amounts to nothing more than a voluntary offer, which may 
 be withdrawn before being acted upon. But if, on the faith of the 
 promise, the promisee, before withdrawal of the promise, expends 
 money and incurs enforceable liabilities in furtherance of the enter- 
 prise the promisor intended to promote, the consideration is supplied, 
 and the promise is rendered valid and binding. Gwenby v. Georgia 
 Baptist Assembly, supra; School District of Kansas City v. Sheidley, ' 
 138 Mo. 672, 40 S. W. 656, 37 L. R. A. 406, 60 Am. St Rep. 576; 
 McCabe v. O'Connor, 69 Iowa, 134, 28 N. W. 573 ; Amherst Academy 
 V. Cowls, 6 Pick. (Mass.) 427, 17 Am. Dec. 387; Richeheu Hotel Co. 
 V. International Military Encampment Co., 140 111. 248, 29 N. E. 1044, 
 33 Am. St. Rep. 234; 1 Page on Contracts, § 298; 1 Elliott on Con- 
 tracts, § 228. In 1 Parsons on Contracts (8th Ed.) *453, it is said: 
 "On the important question, how far voluntary subscriptions fOr char- 
 .itable purposes, as for alms, education, religion, or other public uses 
 -are binding, the law has in this country passed through some fluctua- 
 tion, and cannot now be regarded as on all points settled. Where ad- 
 vances have been made, or expenses or liabilities incurred by others in 
 consequence of such subscriptions, before any notice of withdrawal, 
 this should, on general principles, be deemed sufficient to make them 
 obligatory, provided the advances were authorized by a fair and rea- 
 sonable dependence on the subscriptions; and this rule seems to be well 
 established." The death of the promisor before any liability has been 
 incurred on the faith of the promise would, of course, serve to with- 
 draw or revoke the promise. 
 
 We do not think that, because the promise to give rests in pardl, it 
 is unenforceable after it has been acted on. If the promise is found in 
 a written subscription by the promisor and others, the mutual promis- 
 es furnish a consideration under our Code. But the promise to give to 
 a charitable purpose need not be in writing to be an enforceable con- 
 tract, where the promisee has acted on the faith of it. So long as the 
 promise is gratuitous, it is without consideration ; but, when acted on, 
 there is not only mutuality of contract, but a consideration for the con- 
 tract. If A. promise to buy a house for his nephew, that is nothing; 
 but if A. promise to buy a house for his nephew, and request the neph- 
 ew to enter into a contract of purchase in the nephew's own name, 
 and the nephew does so, the law implies a promise on the part of A. to 
 
Sec. 2) RELIANCE ON A PROMISE AS CONSIDERATION 245 
 
 reimburse the nephew any part of the purchase money which he may 
 be called on to pay. Skidmore v. Bradford, L. R. 8 Eq. 134. * * * 
 Judgment reversed.^* 
 
 PRESBYTERIAN CHURCH OF ALBANY v. COOPER et al. 
 
 (Court of Appeals of New York, 1889. 112 N. Y. 517, 20 N. E. 352 3 L,. R A. 
 468, 8 Am. St. Rep. 767.) ' 
 
 Appeal from supreme court, general term. Third department. 
 
 Action by the Presbyterian Church of Albany against Thomas C. 
 Cooper and another, administrators of Thomas P. Crook, deceased, 
 on a subscription made by the decedent towards paying off a mortgage 
 debt owing by the plaintiff. Judgment was given for defendants, and 
 plaintiff appeals. 
 
 Andrews, J. It is, we think, an insuperable objection to the mainte- 
 nance of this action that there was no valid consideration to uphold 
 the subscription of the defendants' intestate. It is of course unques- 
 tionable that no action can be maintained to enforce a gratuitous prom- 
 ise, however worthy the object intended to be promoted. The per- 
 formance of such a promise rests wholly on the will of the person 
 making it. He can refuse to perform, and his legal right to do so can- 
 not- be disputed, although his refusal may disappoint reasonable ex- 
 pectations, or may not be justified in the forum of conscience. 
 
 By the terms of the subscription paper the subscribers promise and 
 
 26 Subscriptions for a charitable purpose have been enforced in very many 
 cases. Action toward carrying out the purpose and in reliance on the sub- 
 scription is the fact that is most commonly approved as a consideration. 
 Keuka College v. Ray, 167 N. Y. 96, 60 N. E. 325 (1901), other subscriptions 
 obtained in reliance ; De Pauw University v. Ankeny, 97 Wash. 451, 166 Pac. 
 1148 (1917) ; Young Men's Christian Ass'n of Wenatchee v. Olds Co., 84 Wash. 
 630, 147 Pac. 406, L. R. A. 1917F, 1132 (1915) ; Bi^rokaw v. McElroy, 162 Iowa, 
 288, 143 N. W. 1087, 50 L. R. A. fN. S.). 835 (1913) ; Beatty's Estate v. Western 
 College of Toledo, Iowa, 177 111. 280, 52 N. E. 432, 42 L. R. A. 797, 69 Am. St. 
 Rep. 242 (1898); Albert Lea College v. Brown, 88 Minn. 524, 93 N. W. 672, 
 60 li. R. A. 870 (1903) ; Hodges v. Nalty, 104 Wis. 464, 80 N. W. 726 (1899) ; 
 Irwin V. Lombard University, 56 Ohio St. 9, 46 N. E. 63, 36 L. R. A. 239, 60 
 Am. St. Rep. 727 (1897); Rogers v. Galloway Female College, 64 Ark. 627, 44 
 S. W. 454, 39 L. R. A. 636 (1898). 
 
 Some cases hold that one subscription is sufficient consideration for another, 
 creating an enforceable right in the beneficiary. In re Leigh's Estate (Iowa) 
 173 N. W. 143 (1919) . In re Converse's Estate, 240 Pa. 458, 87 Atl. 849 (1913) ; 
 Higert v. Trustees of Indiana Asbury University, 53 Ind. 326 (1876) ; Chris- 
 tian College V. Hendley, 49 Cal. 347 (1874). > 
 
 In some cases the court has found an implied promise by the trustees of 
 the charity to execute the work contemplated, such promise operating as a 
 consideration. Trustees of Maine Cent. Inst. v. Haskell, 73 Me. 140 (1882) : 
 Collier v. Baptist Education Soc. 8 B. Mon. (Ky.) 68 (1847) ; In re Helfen- 
 stein's Estate, 77 Pa. 328, 18 Am. Rep. 449 (1875) ; Superior Consolidated Land 
 Co. V. Bickford. 93 Wis. 220, 67 N. W. 45 (1896) ; Martin v. Meles, 179 Mass.) >j,* 
 114, 60 N. E. 397 (1901). 
 
 In England charitable subscriptions are generally not enforceable. In re 
 Hudson, 54 L. J. Ch. 811 (1885). There are cases in the United States holding 
 likewise. See note in; 48 L. R. A. (N. ■S.),783. 
 
5M6 CONSIDERATION , ■- (Ch. 2 
 
 agree to and with the trustees of the First Presbyterian Church of 
 Albany to pay to said trustees within three years from its date the 
 sums severally subscribed by them, for the purpose of paying off 
 "the mortgage debt of $45,000 on the church edifice," upon the con- 
 dition that the whole sum shall be subscribed or paid in within, one 
 year. It recites a consideration, viz. : "In consideration of one dollar 
 to each of us (subscribers) in hand paid, cUid the agreement of each 
 other in this contract contained." It was shown that the one dollar 
 recited to have been paid was not in fact paid, and the fact that the 
 promise of each subscriber was made by reason of and in reliance.upon 
 similar promises by the others, constitutes no consideration as between 
 the corporation for whose benefit the promise was made and the prom- 
 isors. The recital of a consideration paid does not preclude the prom- 
 isor from disputing the fact in a case like this, nor does the state- 
 ment of a particular consideration, which on its face is insufficient to 
 support a promise, give it any validity, although the fact recited may 
 be true. It has sometimes been supposed that when several persons 
 prortiise to contribute to a common object desired by all, the prom- 
 ise of each may be a good consideration for the promise of others, 
 and this although the object in view is one in which the promisors 
 have no pecuniary or legal interest, and the performance of the prom- 
 ise would not in a legal sense be beneficial to the promisors entering 
 into the engagement. This seems to have been the view of the chan- 
 cellor, as expressed in the Hamilton College Case, when it was before 
 the court of errors, (2 Denio, 417;) and dicta of the judges will be 
 found to the same effect in other cases.. Trustees v. Stetson, 5 Pick. 
 (Mass.) 508; Watkins v. Eames, 9 Cush. (Mass.) 537. But the doc- 
 trine of the chancellor, as we understand, was repudiated when the 
 Hamilton Colleg^Case came before this court, (1 N,. Y. 581), as 
 have been also the dicta in the Massachusetts cases, by the court in that 
 state, in the- recent case of. Church v. Kendall, 121 Mass. 528, 23 Am. 
 Rep. 286. The doctrine seems to us unsound in principle. It proceeds 
 on the assumption that a stranger both to the consideration and the 
 promise, and whose only relation to the transaction is that df donee of 
 an executory gift, may sue to enforce the payment of the gratuity for 
 the reason that there has been a breach of contract between the several 
 promisors, and a failure to carry out, as between themselves, their 
 mutual engagement. It is in no proper sense a case of mutual prom- 
 ises as between the plaintiff and defendant. If any action would 
 lie at all, it would be one between the promisors for breach of contract. 
 In the disposition, therefore, of this case, we must reject the con- 
 sideration recited in the subscription paper as ground for support- 
 ing the promise of the defendants' intestate,— the money considera- 
 tion, — ^because it had no basis in fact, and the mutual promise between 
 •the subscribers, because, as to their promises there is no privity of con- 
 tract between the plaintiff and the promisors. Some consideration 
 must therefore be found other than that expressly stated in the sub- 
 
Sec. 2) RELIANCE ON A PROMISE AS CONSIDERATION 247 
 
 scription paper in order to sustain the action. It is urged that a con- 
 sideration may be found in the efforts of the trustees of the plain- 
 tiff during the year, and the time and labor expended by them during 
 that time, to secure subscriptions in order to fulfill the condition up- 
 on which the liability of the subscribers depended. There is no doubt 
 that labor and services rendered by one party at the request of an- 
 other would constitute a good consideration for a promise made by 
 the latter to the former, based on the rendition of the service. But the 
 plaintiff encounters the difficulty that there is no evidence, express or 
 implied, on the face of the subscription paper, nor any evidence outside 
 of it, that the corporation or its trustees did, or undertook to do, 
 anything upon the invitation or request of the subscribers. Nor is 
 there any evidence that the trustees of the plaintiff, as representatives 
 of the corporation, in fact did anything in their corporate capacity, or 
 otherwise than as individuals interested in promoting the general ob- 
 ject in view. Leaving out of the subscription paper the affirmative 
 statement of the consideration, (which for reasons stated -may be re- 
 jected,) it stands as a naked promise of the subscribers to pay the sev- 
 eral amounts subscribed by them for the purpose of paying the mort- 
 gage on the church property, upon a condition precedent limiting their 
 liability. 
 
 Neither the church nor the trustees promise 4o do anything, nor are 
 they requested to do anything, nor can such a request be implied. It 
 was held in the Hamilton College Case, 1 N. Y. 581, that no such re- 
 quest could be implied from the terms of the subscription in that case, 
 in which the ground for such an iriiplication was, to say the least, as 
 strong as in this case. It may be assumed from the fact that the sub- 
 scriptions were to be paid to the trustees of the church for the pur- 
 pose of paying the mortgage that it was understood that the trustees , 
 were to maJce the payment out of the moneys received. But the duty to 
 make such payment in case they accepted the money, would arise out 
 of. their duty as trustees. This duty would arise upon the receipt of 
 the money, although they had no antecedent knowledge of the sub- 
 scription. They did not assume even this obligation by the terms of the 
 subscription, and the fact that the trustees applied money paid on sub- 
 scriptions upon the mortgage debt did not constitute a consideration 
 for the promise of the defendants' intestate. 
 
 We are unable to distinguish this case in principle from the Hamilton 
 College Case, 1 N. Y. 581. There is nothing that can be urged to sus- 
 tain this subscription that could not with equal force have been urged 
 to sustain the subscription in that case. In both the promise was to the 
 trustees of the respective corporations. In each case the defendant 
 had paid part of his subscription, and resisted the balance. In both 
 part of the subscription had been collected and applied by the trus- 
 tees to the purpose specified. In the Hamilton College Case, (which 
 in that respect is unlike the pi-esent one,) it appeared that the trus- 
 tees had incurred expense in employing agents to procure subscript 
 
248 CONSIDEEATION (Ch. 2 
 
 tions to make up the required amount, and it was shown also that pro- 
 fessors had been employed upon the strength of the fund subscribed. 
 The Hamilton College Case is a controlling authority in this case. It 
 has not been overruled, and has been frequently cited with approval 
 in the courts of this and other states. 
 
 The cases of Barnes v. Ferine, 12 N. Y. 18, and Roberts v. Cobb, 
 103 N. Y. 600, 9 N. E. 500, are not in conflict with the decision in 
 the Hamilton College Case. There is, we suppose, no doubt that a 
 subscription invalid at the time for want of consideration may be 
 made valid and binding by a consideration arising subsequently be- 
 tween the subscribers and the church or corporation for whose bene- 
 fit it is made. Both of the cases cited, as we understand them, were 
 supported on this principle. There was, as was held by the court in 
 each of these cases, a subsequent request by the subscriber to the prom- 
 isee to go on and render service, or incur liabilities, ion the faith of the 
 subscription, which request was complied with, and services were ren- 
 dered or liabilities incurred pursuant thereto. It was as if the reqiiest 
 wks made at the very time of the subscription, followed by performance 
 of the request by the promisor. Judge Allen, in his opinion in Barnes 
 V. Ferine, said "the request and promise were to every legal eff.ect si- 
 multaneous;" and he expressly disclaims any intention to interfere 
 with the decision in the -Hamilton College Case. 
 
 In the present case it was shown that individual trustees were ac- 
 tive in procuring subscriptions. But, as has been said, they acted 
 as individuals, and not in their official capacity. They were deeply 
 interested, as was Mr. Crook; in J:he success of the effort to pay the 
 debt on the church, and they acted in unison. But what the trustees 
 did was not prompted by any request from Mr. Crook. They were all 
 co-laborers in promoting a common object. We can but regret that 
 the intention of the intestate in respect to a matter in which he was 
 deeply interested, and whose interest was manifested up to the very 
 time of his death, is to be thwarted by the conclusion we have reached; 
 but we think there is no alliernatdve, and that the judgment must be 
 affirmed. 
 
 All concur. 
 
 MARTIN et al. v. MELES et al. 
 
 (Supreme Judicial Court of Massachusetts, 1901. 179 Mass. 114, 60 N. E. 397.) 
 
 Holmes, C. J. This is an action to recover the contribution promised' 
 by the following paper, which was signed by the defendants and oth- 
 ers: — "January 21, 1896. We, the undersigned manufacturers of 
 leather, promise to contribute the sum of five hundred (500) dollars 
 each, and such additional sums as a committee appointed ,by the Massa- 
 chusetts Morocco Manufacturers Association may require; in no case 
 shall the Committee demand from any manufacturer or firm a total of 
 
Sec. 2) RELIANCE ON A PROMISE AS CONSIDERATION 249 
 
 subscriptions to exceed the sum of two thousand (2,000) dollars, such 
 sum to be employed for legal and other expenses, under the direction 
 of the Committee, in depending and protecting our interests against 
 any demands or suits growing out of Letters Patent for Chrome Tan- 
 ning, and in case of suit against any of us, the Committee shall take 
 charge thereof and apply as much of the fund as may be needed to 
 the expense of the same." 
 
 The plaintiffs are; the committee referred to in the agreement, and 
 subscribers to it. They were appointed and did some work before the 
 date of the agreement, and then prepared the agreement which was 
 signed by nine rnembers of the association mentioned, and by the de- 
 fendants who were not members. They went on with their work, un- 
 dertook the defence of suits, and levied assessments which were paid, 
 the defendants having paid $750. In November, 1896, the defendants' 
 firm was dissolved, and two members of it, Meles and Auerbach, 
 ceased tanning leather. The defendants notified the plaintiffs of the 
 dissolution, and on June 23, 1897, upon demand for the rest of their 
 subscription refused to pay the same. The main questions insisted up- 
 on, raised by demurrer and by various exceptions, are whether the de- 
 fendants' promise is to be regarded as entire and as supported by a 
 sufficient consideration. 
 
 It will be observed that this is not a subscription to a charity. It is a 
 business agreement for purposes in which the parties had a common 
 interest, and in which the defendants still had an interest after going 
 out of business, as they still were liable to be sued. It contemplates the 
 undertaking of active and more or less arduous duties by the commit- 
 tee, and the rriaking of expenditures and incurring of liabilities on the 
 faith of it. The committee by signing the agreement promised by im- 
 plication not only to accept the subscribers' money but to perform 
 those duties. It is a mistaken construction to say that their promise, or 
 indeed their obligation, arose only as the promise of the subscribers was 
 performed by payments of money. 
 
 If then the committee's promise should be regarded as the consid- 
 eration, as in Institute v. French, 16 Gray, 196, 201 (see Institute v. 
 Haskell, 71 Me. 487), its sufficiency hardly would be open to the ob- 
 jection which has been urged against the doctrine of that case, that 
 the promise of trustees to apply the funds received for a mere benev- 
 olence to the purposes of the trust imposes no new burden upon them. 
 Johnson v. University, 41 Ohio St. 527, 531. See Presbyterian Church 
 V. Cooper, 112 N. Y. 517, 20 N. E. 352, 3 L. R. A. 468, 8 Am. St. Rep. 
 767. Neither would it raise the question whether the promise to 
 receive a gift w:as a consideration for a promise to make one. The 
 most -serious doubt is whether the promise of the committee pur- 
 ports to be the consideration for the subscriptions by a true interpre- 
 tation of the contract. 
 
 In the later Massachusetts cases more weight has been laid on the 
 incurring of other liabilities and making expenditures on the faith of 
 
250 OONSIDBEATIOX (Ch. 2 
 
 the defendant's promise than on the counter-promise of the plaintiff. 
 Cottage St. Church v. Kendall, 121 Mass. 528, 23 Am. Rep. 286; 
 Sherwin v. Fletcher, 168 Mass., 413, 47 N. E. 197. Of course the mere 
 fact that a promisee relies upon a promise made without other consid- 
 eration does not impart validity to what before was void. Bragg v. 
 Danielson, 141 Mass. 195, 196, 4 N. E. 622. There must be some 
 ground for saying that the acts done in reliance upon the promise were 
 contemplated by the form of the transaction either impliedly or in 
 terms as the conventional inducement, motive and equivalent for the 
 promise. But courts have gone very great lengths in discovering the 
 implication of such an. equivalence, sometimes perhaps even having 
 found it in matters which wovild seem to be no more than conditions 
 or natural consequences of the promise. There is the strongest rea- 
 son for interpreting a business agreement in the sense which will give 
 it a legal support, and such agreements have beeti so interpreted. Sher- 
 win V. Fletcher, ubi supra. 
 
 What we have said justifies, in our opinion, the finding of a con- 
 sideration either in the promise or in the subsequent acts of the com- 
 mittee, and it may be questioned whether a nicer interpretation of the 
 contract for the purpose of deciding which of the two was the true 
 one is necessary. It is true that it is urged that the acts of the com- 
 mittee would have been done whether the defendants had promised or 
 not, and therefore lose their competence as consideration because they 
 cannot be said to have been done in reliance upon the promise. But 
 that is a speculation upon which courts do not enter. When an act 
 has been done, to the knowledge of another party, which purports 
 expressly to invite certain conduct on his part, and that conduct on 
 his part follows, it is only under exceptional and peculiar circumstances 
 that it will be inquired how far the act in truth was the motive for the 
 conduct, whether in case of consideration, — Williams v. Carwardine, 
 4 Barn. & Adol. 621 (see Institute v. Haskell, 71 Me. 487),— or of 
 fraud. Windram v. French, 151 Mass. 547, 553, 24 N. E. 914, 8 
 L. R. A. 750. In Cottage St. Church v. Kendall, 121 Mass. 528, 23 
 Am. Rep. 286, the form of the finding in terms excluded subsequent acts 
 as consideration, and therefore it' did not appear whether the facts were 
 such that reliance upon the promise would be presumed. In Academy 
 V. Gilbert, 2 Pick. 579, 13 Am. Dec. 457, the point was that merely sign- 
 ing a subscription paper without more did not invite expenditure on 
 the faith of it. See Academy v. Cowls, 6 Pick. 427, 438, 17 Am. Dec. 
 387; Ives v. Sterling, 6 Mete. 310, 316. In this case the paper indis- 
 putably invited the committee to proceed. 
 
 A more serious difficulty if the acts are the consideration is that it 
 seems to lead to the dilemma that either all acts to be done by the com- 
 mittee must be accomplished before the consideration is furnished, or 
 else that the defendant's promise is to be taken distributively and di- 
 vided up into distinct promises to pay successive sums as successive 
 steps of the committee may make further payments necessary and may 
 
Sec. 2) RELIANCE ON A PROMISE AS CONSIDERATION 251 
 
 furnish consideration for requiring them. The last view is artificial 
 and may be laid on one side. In the most noticeable cases where a man 
 has been held entitled to stop before he has finished his payments, the 
 ground has not been the divisibility of his undertaking but the absence 
 of consideration, which required the court to leave things where it 
 found them. In re Hudson, 54 Law T- Ch. 811 ; Presbyterian Church 
 V. Cooper, 112 N. Y. 517, 20 N. ^-'352, 3 L. R. A. 468, 8 Am. St. 
 Rep. 767. As against the former view, if necessary, we should as- 
 sume that the first substantial act done by the committee was all that 
 was required in the way of acts to found the defendants' obligation. 
 See Academy v. Cowls, 6 Pick. 427, 438, 17 Am. Dec. 387. But if that 
 were true, it would follow that as to the future conduct of the com- 
 mittee their promise not their performance was the consideration, and 
 when we have got as far as that, it may be doubted whether it is not 
 simpler and more reasonable to set the defendants' promise against the 
 plaintiffs' promise alone. We are inclined to this view, but do not deem 
 a more definitive decision necessary, as we are clearly of opinion that, 
 one way or the other, the defendants must pay. 
 
 What has been said pretty nearly disposes of a subordinate point 
 raised by the defendants. It is argued that, by notice pending per- 
 formance that they would not go on with the contract, the defendants, 
 even if they incurred a liability to damages, put an end to the right of 
 the plaintiffs to go on and to recover further assessments, as in the case 
 where an order for work is countermanded at the moment when" per- 
 formance is about to begin under the contract, — Davis v. Bronson, 2 
 N. D. 300, 50 N. W. 836, 16 L. R. A. 655, 33 Am. St. Rep. 783,— or 
 when at a later moment the plaintiff was directed "to stop. Clark v. 
 Marsiglia, 1 Denio (N. Y.) 317, 43 Am. Dec. 670, followed by many 
 later cases in, this country. See Collins, v. Delaporte, 115 Mass. 159, 
 162. We assume that these decisions are right in cases where the 
 continuance of work by the plaintiff' v.'ould be merely a useless en- 
 hancement of damages. But we are of opinion that they do not apply. 
 In the first place, it does not appear that such a notice was given. The 
 first definite notice and the first breach was a refusal to pay on de- 
 mand. At that time the liability was fixed, and the damages were the 
 sum demanded. 
 
 In the next place if a definite notice had been given by the defend- 
 ants in advance that they would not pay, whatever rights it might 
 have given the plaintiffs at their election (Ballou v. Billings, 136 Mass. 
 307), it would not have been a breach of the contract (Daniels v. New- 
 ton, 114 Mass. 530, 19 Am. Rep. 384), and it would not have ended the 
 right of the plaintiffs to go on under the contract in a case like the 
 present, where there was a common interest in the performance, and 
 where what had b6en done and what remained to do probably were to 
 a large extent interdependent (Davis v. Campbell, 93 Iowa, 524, 61 
 N W 1053 ; Gibbons v. Bente, 51 Minn. 499, 53 N. W. 756, 22 L. R. A. 
 80; Cravens v. Mills Co., 120 Ind. 6, 21 N. E. 981, 16 Am. St. Rep. 
 
252 CONSIDERATION (Ch. 2 
 
 298). See Frost v. Knight, L. R. 7 Exch. Ill, 112; Johnstone v. 
 Milling, 16 Q. B. Div. 460, 470, 473 ; Dalrymple v. Scott, 19 Ont. App. 
 477; John A. Roebling's Sons' Co. v. Lock-Stitch Fence Co., 130 II!. 
 660, 22 N. E. 518; Davis v. Bronson, 2 N. D. 300, 303, 50 N. W. 836, 
 16 L. R. A. 655, 33 Am. St. Rep. 783. 
 
 Before leaving the case it is interesting to remark that the notion 
 rightly exploded in Cottage St. Church v. Kendall, 121 Mass. 528, 530, 
 531, 23 Am. Rep. 286, that the subscription of others than the plain- 
 tiff may be a consideration, seems to have remained unquestioned with 
 regard to agreeitnents of creditors to accept a composition. Compare 
 the remarks of Wells, J., in Perkins v. Lockwood, 100 Mass. 249, 250, 
 1 Am. Rep. 103 (Parrihgton v. Hodgdon, 119 Mass. 453, 457; Trecy 
 v. Jefts, 149 Mass. 211, 212, 21 N. E. 360; Emerson v. Gerber, 178 
 Mass. 130, 59 N. E. 666), with what he says in Music Hall Co. v. 
 Carey, 116 Mass. 471,474. 
 
 It is not argued that whatever contract was made was not made with 
 the plaintiffs. Sherwin v. Fletcher, 168 Mass! 413, 47 N. E. 197. 
 
 Demurrer overruled. 
 
 Exceptions overruled.''^ 
 
 , SECTION 3.— FORBEARANCE AS CONSIDERATION 
 (Compromise Agreements) 
 
 HAMER v. SIDWAY. 
 
 (Court of Appeals of New York, 1891. 124 N. Y. 538, 27 N. E. 256, 12 L. R. A. 
 463, 21 Ada. St. Kep. 693.) 
 
 Appeal from an order of the general term of the supreme court in 
 the fourth judicial department, reversing a judgment entered on the 
 decision of the court at special term in the county clerk's office of 
 Chemung county on the 1st day of October, 1889. The plaintiff pre- 
 sented a claim to the executor of William E. Story, Sr., for $5,000 and 
 iriterest from the 6th day of February, 1875. She acquired it through 
 several mesne assignments from William E. Story, 2d. The claim be- 
 ing rejected by the executor, this action was brought. It appears that 
 William E. Story, Sr., was the uncle of William E. Story, 2d; that at 
 the celebration of the golden wedding of Samuel Story and wife, fa- 
 ther and mother of William E. Story, Sr., on the 20th day of March, 
 1869, in the presence of the family and invited guests, he promised 
 his nephew that if he would refrain from drinking, using tobacco, 
 swearing, and playing cards or billiards for money until he became 21 
 years of age, he would pay him the sum of $5,000. The nephew as- 
 
 27 A similar case is Carr.v. Bartlett, 72 Me. 120 (1881). 
 
Sec. 3) rOEBEAEANCE AS CONSIDERATION 253: 
 
 sented thereto, and fully performed the conditions inducing the prom- 
 ise. When the nephew arrived at the age of 21 years, and on the 31st 
 day of January, 1875, he wrote to his uncle, informing him that he had 
 performed his part of the agreement, and had thereby become entitled 
 to the sum of $5,000. 
 
 The uncle received the letter, and a few days later, and on the 6th 
 day of February, he wrote and mailed to his nephew the following let- 
 ter: "Buffalo, Feb. 6, 1875. W. E. Story, Jr.— Dear Nephew: Your 
 letter of the 31st ult. came to hand all right, saying that you had lived 
 up to the promise made to me several years ago. I have no doubt but 
 you have, for which you shall have five thousand dollars, as I prom- 
 ised you. I had the money in the bank the day you was twenty-one 
 years old that I intend for you, and you shall have the money certain. 
 Now, Willie, I do not intend to interfere with this money in any way 
 till I think you are capable of taking care of it, and the sooner that 
 time comes the better it will please me. I would hate very much to 
 have you start out in some adventure that you thought all right and 
 lose this money in one year. The first five thousand dollars that I got 
 together cost me a heap of hard work. * * * This money you 
 have earned much easier than I did, besides, acquiring good habits at 
 the same time, and you are quite welcome to the money. Hope you 
 will make good use of it. I was ten long years getting this together 
 after I was your age. * * * Truly yours, W. E. Story. P. S. 
 You can consider this money on interest." 
 
 The nephew received the letter, and thereafter consented that the 
 money should remain with his uncle in accordance with the terms and 
 conditions of the letter. The uncle died on the 29th day of January, 
 1887, without having paid over to his nephew any portion of the said 
 $5,000 and interest.^^ 
 
 Parker, J. * * * The defendant contends that the contract 
 was without consideration to support it, and therefore invalid. He 
 asserts that the promisee, by refraining from the use of liquor and to- 
 bacco, was not harmed, but benefited ; that that which he did was best 
 for him to do, independently of his uncle's promise, — and insists that 
 it follows that, unle.^s the promisor was 'benefited, the contract was 
 without consideration, — a contention which, if well founded, would 
 seem to leave open for controversy in many cases whether that which 
 the promisee did or omitted to do was in fact of such benefit to him as 
 to leave no consideration to support the enforcement of the promisor's 
 agreement. Such a rule could not be tolerated, and is without founda- 
 tion in the law. The Exchequer Chamber in 1875 defined "considera- 
 tion" as follows: "A valuable consideration, in the sense of the law, 
 may consist either in some right, interest, profit, or benefit accruing to 
 the one party, or some forbearance, detriment, loss, or responsibility 
 given, suffered, or undertaken by the oth'er." Courts "will not ask 
 
 28 The statement of facts has been abbreviated, and part of the opinion Is 
 omitted. 
 
254 CONSIDERATION , (Ch. 2 
 
 whether the thing which forms the consideration does in fact benefit 
 the promisee or a third party, or is of any substantial value to any one. 
 It is enough that something is promised, done, forborne, or suffered by 
 the party to whom the promise is made as consideration for the promr 
 ise made to him." Anson, Cont. 63. "In general a waiver of any le- 
 gal right at the request of another party is a sufficient, consideration 
 for a promise." Pars. Cont. *444. "Any damage, or suspension. Or 
 forbearance of a right will be sufficient to sustain a promise." 2 Kent, 
 Comm. (12th Ed.) *465. Pollock in his work on Contracts, (page 166,) 
 after citing the definition given by the Exchequer Chamber, already 
 quoted, says: "The second branch of this judicial description is really 
 the most important one. 'Consideration' means not so much that one 
 party is profiting as that the odier abandons some legal right in the 
 present, or limits his legal freedom .of action in the future, as an in- 
 ducement for the promise of the first." 
 
 Now, applying this rule to the f actis before us, the promisee used 
 tobacco, occasionally drank liquor, and he had a legal right to do so. 
 That right he abandoned for a period of years upon the strength of 
 the promise of the testator that for such forbearance he would give 
 him $5,000. We need not speculate on the effort which may have been 
 required to give up the use of those stimulants. It is sufficient that he 
 restricted his lawful freedom of action within certain prescribed lim- 
 its upon the faith of his uncle's agreement, and now, having fully per- 
 formed the conditions imposed, it is of no moment whether such per- 
 formance actually proved a benefit to the promisor, and the court will 
 hot inquire into it; but, were it a proper subject of inquiry, we see 
 nothing in this record that would permit a determination that the uncle 
 was not benefited in a legal sense. Few cases h^ve been found which 
 may be said to be precisely in point, but such as have been, support the 
 position we have taken. * * * 
 
 Order appealed from reversed, and judgment of the special term af- 
 firmed.^* 
 
 ORR V. ORR. 
 
 (Appellate Court of Illinois, 1913. 181 111. App. 148.) 
 
 Mr. Justice Philbrick delivered the opinion of the court. 
 
 Mina M. Orr, appellee, was married to one Fred W. Orr, on June 
 5, 1909. Prior to the time of his marriage to appelke, Fred W. Orr 
 held a benefit certificate in the Modern Woodmen of America in the 
 sum of $2,000. One child, Carol W. Orr, was born of this marriage. 
 Fred W. Orr died on August 17, 1910, intestate, at his father's house 
 where he had been sick for several weeks, leaving surviving him ap- 
 
 2» In accord: Lindell v. Rokes, 60 Mo. 249, 21 Am. Rep. 395 (1875) ; Dun- 
 ton V. Dunton, 18 Vict. L. E. 114 (1892), promise to pay a divorced wife as 
 long as she lived soberly, virtuously, and respectably. 
 
Sec. 3) POEBEAEANCB AS CONSIDERATION 255 
 
 pellee and his son, Carol W. Orr. Appellee and her child were de^ 
 pendent upon the father and husband for their support. The father, 
 John W. Orr, was the beneficiary named in this policy at the time of 
 the death of Fred W. Orr, and after his death, proper proofs having 
 been made, the amount of the policy was paid to John W. Orr. 
 
 Appellee contends that prior to the death of her husband, it had 
 been her desire that the beneficiary in the said benefit certificate be 
 changed so that she would become the beneficiary. After Fred W. Orr 
 was taken sick and while at his father's house, appellee insists that 
 she and John W. Orr, the father, talked over and discussed the ques- 
 tion of the change in the name of the beneficiary in this certificate 
 fropi John W. Orr, the father, to appellee. That she made known to 
 John W. Orr, her intention to go to her husband while he was sick 
 at the home of John W. Orr and have him surrender the old certificate 
 and' to cause to be issued in lieu thereof another benefit certificate in 
 which appellee should be named as beneficiary, so that upon the death 
 of her husband appellee would receive this money. Appellee insists 
 that when her intention of going to her husband for this purpose was 
 made known to John W. Orr that he demurred to her going to his son 
 with this request; fearing that a request of this kind at a time when 
 Fred W. Orr was sick and not expected to recover wCiuld result fa- 
 tally to him ; the said John W. Orr promised and agreed with appel- 
 lee herein that if she Would refrain from going to Fred W. Orr who 
 was then dangerously ill, and not worry or bother him concerning the 
 change of beneficiaries that he would hold the policy for the benefit of 
 her and the child, and that he, fearing that if the husband was wor- 
 ried about a change in the beneficiary that the result to the said Fred 
 W. Orr, who was dangerously ill and suffering from a weak heart, 
 might hasten his death and result fatally to him; and that the said 
 John W. Orr then and there promised and agreed to and with appel- 
 lee that if she woiild refrain from approaching Fred W. Orr upon 
 this subject that he would guarantee to her and see that she and her 
 child received the benefit of this certificate; and that if his son did 
 not recover from that sickness he would collect the same and hold 
 it for the benefit of her apd the child ; and' that, relying upon the prom- 
 ises of the said John W. Orr, she did refrain and forbear from going 
 to her husband with a request that the beneficiary be changed. 
 
 John W. Orr collected the insurance and claims to own and hold the 
 same for his own use and benefit. The suit was originally commenced 
 by appellee as administratrix. Before final judgment, the child died, 
 and thereupon appellee was granted leave and amended the cause of 
 action so as to prosecute the cause in her own name. The trial below 
 resulted in a verdict and judgment against appellant, from which he 
 appeals. , 
 
 ' Appellant contends this judgment is erroneous and should be re- 
 versed, insisting that the evidence does not sustain the allegations of the 
 declaration regarding the promise alleged to have been made by ap- 
 
256 CONSIDERATION (Ch. 2 
 
 pellant to appellee; also, that, conceding that the promise was made, 
 there was no consideration therefor for the reason that she had no 
 power even though she did request her husband to change this policy, 
 to compel him to do so; further, that it was a mere speculation on 
 her part whether or not he would make the change at her request ; 
 that the court erred in permitting appellee to amend and prosecute the 
 cause in her own name. 
 
 The child died soon after the death of the father, and if appellant 
 made a promise that he would collect the money and pay it over to 
 appellee for the benefit of herself and child, after the death of the 
 child appellee would be entitled to receive the entire amount. 
 
 We are satisfied from the testimoiiy of the various witnesses that the 
 contention of appellee that appellant made the promise alleged to 
 have been made to her is fully sustained, and that the verdict of the 
 jury is not contrary to the evidenec and that it cannot bt set aside on 
 the ground that there is no evidence to support it. 
 
 Appellee had the right to request he;- husband to make the change 
 of beneficiary in this policy before his death, and secure the benefit of 
 the certificate for herself and child if it was possible for her to do 
 so. The policy was taken out by the deceased before his marriage to 
 appellee and the father then made beneficiary; after appellee and his 
 only child becanie the natural objects of his bounty, it would only be 
 natural that he should change the beneficiary during his last illness so 
 that they would derive the benefit therefrom, unless some urgent rea- 
 sons for his not so doing are shown. Appellee at least had the right 
 to go to him and urge this, with such persuasion as she might bring 
 to bear upon him for that purpose. And the father, knowing the con- 
 dition of his son and desiring that he should recover from his ill- 
 ness, undoubtedly ijesired to do everything in his power to prevent 
 anything which might worry or aggravate the condition of his son, 
 and to avoid any serious consequence to him by reason of the im- 
 portunities that the wife might make, promised appellee that if she 
 would refrain from exercising her right in endeavoring to secure 
 a change of beneficiary in this policy and would allow the policy 
 to stand as it was that she and the child should receive the benefits of 
 it, and that he would collect the same and pay it to her. 
 
 It is well established that a promise or agreement carried out or com- 
 pleted which deprives the party of any substantial right, when done 
 at the request of another, is a sufficient consideration to sustain the 
 promise by the other party for the fulfillment and enforcement of 
 the agreement then made by him, that one promise is a sufficient con- 
 sideration for another, and the question of the adequacy of the con- 
 sideration or the inequality of the consideration is wholly immate- 
 rial. And it is wholly immaterial on the question of the consideration 
 for this promise whether or not appellee would have been able to have 
 secured the change in the beneficiary which she desired, it was a valua- 
 Tsle consideration, if by acceding to the demands or request of appel- 
 
Sec. 3) POBBEARANCE AS CONSIDERATION 257 
 
 lant she waived and abandoned a right she then had of endeavoring 
 to persuade her husband to make the wife and child beneficiaries un- 
 der the policy. 
 
 -In determining whether there was a valuable consideration for the 
 making of this promise by defendant it is not necessary that there 
 should have been any pecuniary benefit to appellant, if there was a 
 valuable consideration, however small it might have been, then it 
 was sufficient. Parsons on Cont. (6th Ed.) 443 ; Page on Cont. vol. 
 1, § 274; Talbott v. Stemmons' Ex'r, 89 Ky. 222, 12 S. W. 297, 5 L. 
 R. A. 856, 25 Am. St. Rep. 531 ; Hamer v. Sidway, 124 N. Y. 538, 
 27 N. E. 256, 12 L. R. A. 463, notes, 21 Am. St. Rep. 693. 
 
 We are of the opinion that the agreement of appellee to refrain 
 from going to her husband in his then condition with the request which 
 she had the right to make and which she had the right to expect 
 would be granted her, was sufficient consideration on her part to sustain 
 the promise of appellant that in case the husband should not recover 
 from that sickness appellant would collect the money and pay the same 
 over to appellee for the benefit of herself and child. 
 
 There is no error in this record. The judgment is right and will be 
 affirmed. 
 
 Affirmed.^" 
 
 WHITE V. McMATH & JOHNSTON. 
 
 (Supreme Court of Tennessee, 1913. 127 Tenn. 713, 156 S. W. 470, 44 L. R. A. 
 
 [N. S.] 1115.) 
 
 Action by McMath & Johnston against W. C. White. A judgment 
 for plaintiff was affirmed by the Court of Civil Appeals, and defendant 
 petitions for a writ of certiorari. Denied. ' 
 
 Williams, J." This suit was brought by McMath & Johnston 
 against White to recover $240, and is before us on petition of certiorari 
 to reverse the judgment of the Court of Civil Appeals, affirming the 
 judgment of the circuit court of Shelby county in favor of plaintiffs in 
 the last-named court. 
 
 McMath & Johnston were engaged in the business, in Memphis, of 
 buying and selling real estate, and had entered into negotiations with 
 the owners of a tract of laiid near Dundee, Miss., and had examined 
 the land and obtained an offer from the owners to sell same to them at 
 .$17.50 per acre, and an acceptance was under consideration. White 
 later made an examination of the tract, and endeavored to negotiate 
 
 3 Forbearance to make unwelcome visits and requests. Sharon v. Sharon, 
 68 Cal. 29, 8 Pac. 614 (1885) ; Jamleson v. Renwick, 17 Vict. L. B. 124 (1891). 
 Cf. White V. Bluett, 23 Ij. J. Ex. 36 (1853), forbearance of son to make com- 
 plaints to his father held no consideration ; "by the argument a principle is 
 pressed to an absurdity, as a bubble is blown until it bursts." 
 
 31 Part of the opinion is omitted. 
 
 COBBIN OONT — 17 
 
258 CONSIDEKATION ' (Ch. 2 
 
 with its owners ; but, in view of the offer then outstanding to McMath 
 & Johnston, the owners of the land would not sell.. White then went 
 to the office of McMath & Johnston in an effort to get them out of the 
 way. At his instance and for his benefit the following contract was 
 entered into: 
 
 "For a valuable consideration to me in hand paid by McMath & 
 Johnston, receipt of which I hereby acknowledge, I hereby agree that 
 I will purchase from Trotter & Dreyfus, owners, a certain tract of 480 
 acres of land near Dundee, Miss., and upon delivery to me by owners 
 of satisfactory conveyance therefor I will pay said McMath & John- 
 ston the sum of $240. 
 
 "It being expressly understood between the parties hereto that said 
 McMath & Johnston have had said land offered to them by the own- 
 ers at $17.50 per acre, and they are now considering the purchase of 
 said land on their own account. The consideration for the payment of 
 said sum is relinquishment by said McMath & Johnston of their right 
 to purchase said land at said prices, and leaving me, W. C. White, free 
 to conduct negotiations on myjown account with said owners. Sale to 
 any one else caused by me, or in my interest, shall be deemed a sale to 
 me. We agree to perform the above contract [Signed] W. C. White. 
 McMath & Johnston, Incorporated, by F. M. McMath, Pres." 
 
 The errors assigned disclose two defenses : (1) That the contract is 
 void, because executed for the purpose of preventing competition, and 
 is, therefore, against public policy ; ^^ (2) that the contract is not sup- 
 ported by a consideration. * * * 
 
 That the contract was supported by a sufficient consideration is held 
 in the cases above cited. Witljholding competition, when not opposed 
 to public policy, is a binding consideration. 6 Am. & Eng. Enc. L,. 
 (2d Ed.) 746, and cases there cited ; Spitz v. Bank, 8 Lea, 641 ; Bed- 
 ford County V. Railroad, 14 Lea, 525. 
 
 The result of the decree of the Court of Civil Appeals being a cor- 
 rect one the writ of certiorari is denied.^* 
 
 32 The court held, citing several authorities, that the agreement was not il- 
 legal, there being no stifling of competition at a public or auction sale. 
 
 ^3 Did the agreement destroy the plaintiffs' power of accepting the Dundee 
 offer, or did it create merely a duty not to exercise such power of acceptance? 
 Did it create a power in White to accept the Dundee offer? 
 
 The surrender of any legal power that one is privileged to exercise is a 
 sufficient consideration, and so also is the forbearance to exercise such a 
 power, even if it is not surrendered. Schade v. MuUer, 75 Or. 225, 146 Pac. 
 144 (1915), power of filing mechanic's lien; Skinner v. Fisher, 120 Ark. 91, 178 
 S. W. 922 (1915) ; Bickel v. Wessinger, 58 Or. 98, 113 Pac. 34 (1911), forbear- 
 ance to redeem property sold under mortgage foreclosure. 
 
 Forbearance to make an offer or bid, or the revocation of an offer already 
 made, or the forbearance to accept an offer, is sufficient consideration. See 
 Hughes V. Foltz, 142 Mo. App. 513, 127 S. W. 112 (1910) ; Eauch v. Donovan, 
 126 App. Div. 52, 110 N. T. Supp. 690 (1908). 
 
Sec. 3) FORBEARANCE AS CONSIDERATION 259 
 
 GIIvL V. HAREWOOD. 
 
 (In the Common Pleas, 1587. 1 Leon. 61.) 
 
 Gillwought an action upon the case against Harewood, and declar- 
 ed; that where the defendant was endebted to the plaintiff in such a 
 sum, and shewed how ; the defendant in consideration that the plain- 
 tiff, per parvum tempus deferret diem solutionis, &c. did promise to 
 pay, &c. And upon non assumpsit pleaded it was found for the plain- 
 tiff, and it was moved in arrest of judgment, that here is not any con- 
 sideration, for no. time is limited for the forbearance, but generally, 
 parvum tempus, which cannot be any commodity to the defendant, for 
 the same niay be, but punctum temporis, &c. But the exception was 
 not allowed, for the debt in itself is a sufficient consideration. 
 
 MAPES V. SIDNEY. 
 (Court of Common Pleas, 1623. Cro. Jae. 683.) 
 
 Assumpsit; for that the defendant, in consideration the plaintiff 
 would forbear to sue one J. S. on an obligation of eighty pounds, prom- 
 ised to pay to him the said debt ; and alledgeth in fact, in the writ, that 
 he forbore to sue the said J. S. per magnum tempus, and that the de- 
 fendant had not as yet paid it to him, licet requisitus. 
 
 The declaration was, that he forbore him per magnum tempus, viz. 
 from such a time of the promise until such a day, which was for a year 
 and a half after the promise, yet he had not paid it. 
 
 The defendant pleaded non assumpsit; and it was found against 
 him to the damage of eighty pounds. 
 
 Hitcham moved in arrest 6i judgment. 
 
 Lord HoBART, Winch, and HuTTon, (Jones being absent in Chan- 
 cery) held, that the plaintiff should recover : for they all conceived that , 
 a consideration to forbear to sue a person for such a debt is a good con- 
 sideration, and it shall be intended a total and absolute forbearance (as 
 HuTTON and Wjnch held) ; and that if the defendant paid it before up- 
 on this promise, and after the plaintiff sued for the debt, the plaintiff is 
 chargeable in an action upon the case, for it is an implied promise in 
 the plaintiff that he should forbear his suit totally ; but yet when the 
 plaintiff hath,forborne_a convenient time (when there is no time men- 
 tioned), if the defendant do not pay the debt according to his promise, 
 the plaintiff may well sue him upon his promise, and he needs not tarry 
 all his life. And here, when he shows that he forbore per magnum 
 tempus, viz. such a day and year, that well agrees with the writ ; and 
 when the date of the writ doth not appear, it shall be intended that he 
 did forbear until the day of the writ ; and so the action is well brought. 
 HoBART, Chief Justice, agreed with them, that the action was well 
 brought, and the declaration good, because he shews he did forbear it 
 
260 CONSIDBfiATION (Ch, 2 
 
 for a convenient time: and he held that he was not bound by this 
 agreement to forbear totally ; and denied, that upon this agreement he 
 is chargeable in an assumpsit, if he (after this debt recovered from the 
 defendant) should sue for the same debt ; for it is not a promise to re- 
 strain him totally, and without express words he is not chargrable by 
 promise. Wherefore it was adjudged for the plaintiff.^* 
 
 DAVIES V. WARNER. 
 
 (In the King's Bench, 1620. Oro. Jac. 593.) 
 
 Assumpsit. Whereas the defendant's testator was indebted to him 
 in thirty-three pounds; that in consideration the plaintiff would for- 
 bear to sue the defendant until he had execution upon such a judgment, 
 the defendant promised to pay the said thirty-three pounds upon re- 
 quest, after he had obtained execution of such a judgment; and alledg- 
 eth in facto, that he had obtained execution of the said judgment: et 
 licet requisitus, &c. such a day had not paid. 
 
 Upon non assumpsit pleaded, and found for the plaintiff, it was al- 
 ledged in arrest of judgment, that it doth not appear how he was- in- 
 debted, nor that he had assets, otherwise there is no cause to bind him. 
 
 Sed non allocatur; for if the action were founded upon the debt, 
 then he ought to shew how he was indebted ; but it is grounded upon 
 his own promise ; and it shall be intended he was indebted ; otherwise 
 he would not assume : wherefore it was adjudged for the plaintiff.^" 
 
 3* The surrender and discharge of any legal right, or a forbearance to en- 
 force it, even though it is not surrendered, is a sufficient consideration. This 
 is true, even though the right is future and subject to an uncertain contin- 
 gency. Eelease of "inchoate right of dower" by woman whose husband is still 
 living. Fitcher v. Grifliths, 216 Mass. 174, 103 N. E. 471 (1913) ; Holmes v. 
 Winchester, 133 Mass. 140 (1882) ; Beverlin v. Casto, 62 W. Va. 158, 57 S. E. 
 411 (1907). 
 
 Release from engagement to marry. Shell v. Bray, 56 Wis. 156, 14 N. W. 
 14 (1882) ; Henderson v. Spratlen, 44 Colo. 278, 98 Pac. 14, 19 L. R. A. (N. S.) 
 655 (1908). 
 
 A promise to forbear for a "reasonable time" is sufficient. Traders' Nat. 
 Bank V. Parker, 130 N. Y. 415, 29 N. E. 1094 (1892), So also is actual for- 
 bearance for a "reasonable time." Oldershaw v. King, 2 H. & N. 399, 517 
 (1857). 
 
 Of course, the surrender of a privilege (or forbearance to exercise it) is a 
 sufficient consideration. To surrender a privilege is to create a duty to some 
 one. The doing of an act which creates a duty to a third person (e. g., giving 
 a guaranty) is a sufficient consideration. Ziehm v. .Frank Steil Brewing Co 
 of Baltimore City, 131 Md. 583, 102 Atl. 1005 (1917). 
 
 3 5 In accord: Austin v. Bewley, Cro. Jac. 548 (1619) ; Linghill v. Broughton, 
 Mogre, K. B. 853 (1617). 
 
 "If an executor promiseth to a creditor that if he will forbear to sue him 
 until such a time that then he will satisfy the creditor his debt, in that case 
 the executor is liable to pay the debt of his own goods ; adjudged " Escrig's 
 Case, 4 Leon. 3 (1589). 
 
Sec. 3) FOEBEABANCE AS CONSIDERATION 261 
 
 DOWDENAY v. OLAND. 
 
 (In the Queen's Bench, 1599. Oro. Eliz. 768.) 
 
 Error of a judgment in the Common Pleas, in Trinity term, 40 Eliz. 
 Roll 2716. Assumpsit, whereas he was obliged to the defendant by 
 an obligation in £40 for the payment of i20 at a day mentioned in the 
 condition; and whereas the plaintiff intending to exhibit a bill in 
 the Chancery against the defendant pro eo, that he confessed that he 
 was satisfied of the debt, took forth a writ of subpoena out of Chan- 
 cery, returnable at a day certain ; that the defendant, in consideration 
 the plaintiff would desist from his suit in the Chancery, assumed to 
 the plaintiff to restore that bond upon request: and alledgeth in, fact, 
 that he required the redelivery of that bond, and his desisting from 
 the said, suit ; and that the defendant had not delivered it, but prosecut- 
 ed suit thereupon, &c. The defendant pleaded non assumpsit ; and 
 found against him. And after divers motions in the Common Pleas 
 in stay of judgment, because the consideration is not sufficient, being 
 only to stay a suit in Chancery, which is matter of conscience, and not 
 at the common law, it was held to be good enough, and adjudged for the 
 plaintiff.^And now error being brought, the judgment was affirmed. 
 
 RIVETT and RIVETT'S CASE. 
 
 (In the King's Bench, 1588. 1 Leon. 118.) 
 
 Edmund Rivett brought an action upon the case against George Riv- 
 ett, and declared, that where it was pretended by the defendant, 
 that one R. made his will, and by the same devised certain legacies 
 to the defendant, and the plaintiff upon that had sued in the Preroga- 
 tive Court of Canterbury for to disprove the said will; and if he 
 prosecutus fuisset, he might have disproved the said will and so de- 
 feated the defendant of his pretended legacies : the defendant in con- 
 sideration that the plaintiff, ultra non procederet, did promise to give 
 to the plaintiff one hundred pounds; and averred, that he had sur- 
 ceased his said suit ; and further declared, that licet the defendant, ad 
 hoc requisitus fuerit tali die & anno, &c. It was moved in arrest of 
 judgment, that here is not any consideration, for the defendant hath 
 not any means to compel the plaintiff for to surcease his suit, for there 
 is not any cross promise set forth in the declaration; and although 
 that he doth surcease his suit, yet he may begin the same again, and 
 therefore the plaintiff ought to have shewed in his declaration a release 
 or other discharge of it. Judgment was given for the plaintiff.^" 
 
 3« A portion of the report is omitted. 
 
262 CONSIDERATION (Ch, 2 
 
 J. H. QUEAL & CO. V. PETERSON. 
 
 (Supreme Court of Iowa, 1908. 138 lOwa, 514, 116 N. W. 593, 19 L. R. A. 
 
 [N. S.] 842.) 
 
 Action on a written instrument of guaranty. 'At the conclusion of 
 the evidence there was a directed verdict for defendant, and from the 
 judgriient thereon plaintiff appeals. Affirmed. 
 
 McCi^AiN, J. On April 8, 1896, one Nielson was indebted to plain- 
 tiff on a promissory note for $120 then past due, and defendant ex- 
 ecuted to plaintiff his promise to pay the same in the following words: 
 "In regard to the N. S. Nielson note of $120 held byiyou and due Sep- 
 tember 1, 1895, if this note is not paid by said Nielson by October 1, 
 1896, I hereby agree to take it up October 1, 1896, for $100." 
 
 Action being brought against- defendant on this obligation, nonpay- 
 ment by Nielson of his note being alleged, defendant denied his liability 
 on the ground that his obligation was entered into without any con- 
 sideration, and the evidence showed that, while defendant did volunta- 
 rily undertake-^to satisfy Nielson's obligation for $120, with interest, 
 by paying $100 at a future date, provided Nielson's note then; remained 
 unpaid, there is no evidence that defendant requested plaintiffs to for- 
 bear suit on the Neilson note, or that plaintiffs agreed to forbear such 
 suit, or that plaintiffs did forbear in reliance on defendant's guaranty. 
 An agreement to forbear for a time the enforcement of a claim is a 
 valid consideration for the promise of a third person to pay. Burke 
 V. DiUin, 92 Iowa, 557, 564, 61 N. W. 371 ; Rix v. Adams, 9 Vt. 233, 
 31 Am. Dec. 619. While it seems to have been thought at one time 
 that the promise to forbear which would serve as consideration for a 
 guaranty by a third person must be for a definite time, or for a reason- 
 able time, nevertheless it has been held that, yhere there is an agree- 
 ment to forbear, it will be presumed to be for a reasonable time in the 
 absence of any stipulation as to a specified time. Strong v. Sheffield, 
 144 N. Y. 392, 39 N. E. 330; Sidwell v. Evans, 1 Pen. & W. (Pa.) 
 383, 21. Am. Dec. 387. If the creditor does in fact forbear from 
 suing at the request of another, there is a good consideration for the 
 guaranty of the indebtedness in connection with such request. Crears 
 V. Hunter, 19 Q. B. D. 341.^'' But the mere fact of forbearance is not 
 sufficient evidence from which a promise to forbear may be presumed, 
 in the absence of any circumstances from which such agreement may 
 be inferred. Manter v. Churchill, 127 Mass. 31. 
 
 37 Forbearance to press a claim against A. is a sufl3cient consideration for 
 a promise of B. to pay A.'s debt, if so agreed. Thayer v. Fray's' Estate, 111 
 Minn. 449, 127 N. W. 392- (1910) ; Wells & Morris v. Brown, 67 Wash. 351, 121 
 Pac. 828, Ann. Cas. 1913D, 317 (1912) ; United & Globe Rubber Mfg. Go. v. 
 Conard, 80 N. J. Law, 286, 78 Atl. 203, Ann. Gas. 1912A, 412 (1910), promise 
 to forbear ; Silver v. Graves, 210 Mass. 26, 95 N. E. 948 (1911) .; Waters v. 
 White, 75 Conn. 88, 52 Atl. 401 (1902) ; Markel v. Di Francesco, 93 Conn. 355, 
 105 Atl. 703 (1919) ; Estate of Thomson, 165 Cal. 290, 131 Pac. 1045 (1913). 
 
Sec. 3) POEBEABANCE AS CONSIDERATION 263 
 
 As the defendant did not request plaintiffs to iforbear suit on the 
 Nielson note, and plciintiifs did not agree to do so, the fact of forbear- 
 ance does not indicate that it was in pursuance of a promise to forbear, 
 nor does the forbearance itself imply a request. Had plaintiffs brought 
 suit against Nielson immediately after the execution of defendant's 
 obligation, Nielson could not have defended on the ground that there 
 was an agreement of extension. Therefore plaintiffs, having remained 
 without interruption entitled to all the rights which they had against 
 Nielson, suffered no detriment in consequence of the guaranty given 
 by defendant, and, on the other hand, neither Nielson nor defendant 
 received any benefit in consequence of defendant's promise. It is 
 clear that under such circumstances defendant's promise to pay Niel- 
 sen's debt was without consideration. 
 
 Judgment of the trial court is therefore affirmed.'* 
 
 SCHROYER et al. v. THOMPSON et al. 
 
 (Supreme Court of Pennsylvania, 1918. 262 Pa. 282, 105 Atl. 274, 2 A. L. R. 
 
 1567.) 
 
 Assumpsit on notes by E. E. Schroyer and others against Josiah 
 V. Thompson and others. From an order refusing judgment for plain- 
 tiffs for want of a sufficient affidavit of defense, plaintiffs appeal. Re- 
 versed, and record remitted to lower court, with directions to enter 
 judgment against defendants, unless cause is shown. 
 
 FrazER, J. Plaintiffs' action is founded on two demand notes signed 
 by one defendant as principal and the others as sureties, and assigned 
 by the payees to plaintiffs. The sureties each filed an affidavit of de- 
 fense alleging release from liability, awing to a memorandum indorsed 
 on the back of the notes, subsequent to their execution and without 
 consent of the sureties, stating, "All overdue int. to bear int. to,be com- 
 pounded semiannually." A rule for judgment for want of a sufficient 
 affidavit of defense was discharged, and plaintiffs appealed. 
 
 It is not denied the agreement to pay interest on interest is a material 
 alteration affecting the sum payable for interest within the meaning of 
 the 125th section of the Negotiable Instrument Act of May 16, 1901 
 (P. L. 194). Plaintiffs contend, however, the memorandum is without 
 effect so far as the sureties are concerned, because not on the face of 
 the instrument, and consequently not an alteration of its terms, but 
 merely a separate agreement between maker and payee. Discussing 
 or deciding this question is unnecessary since, under the view we 
 take of the case, the decree of the court below must be reversed for a 
 different reason. 
 
 3 8 Is not forbearance in fact a detriment to the creditor and a benefit to 
 the debtor, irrespective of any agreement? What caused the creditor to for- 
 
 ''^In Tccordt'^Shldbume v. Daly, 76 Cal. 355, 18 Pac. 403 (1888). 
 
264 CONSIDERATION (Ch. 2 
 
 ,' A surety has a right to require strict performance ^of the contract, 
 and an agreement between the principals varying its terms in a ma- 
 terial part without the consent of, the surety will release him from lia- 
 bility. Bensinger v. Wren, 100 Pa. 500; Nesbitt v. Turner, 155 Pa. 
 429, 26 Atl.750; Robbins v. Robinson, 176 Pa. 341, 35 Atl. 337. It 
 must be conceded that an agreement between the principals having, the 
 effect of altering the written terms of the contract must be based upon 
 a sufficient consideration, that is, must be a valid and enforceable con- 
 tract. 
 
 The affidavit of defense filed contained no averment ofi aii extension 
 of time for payment of interest, nor do they set up other facts capable 
 of being construed as a consideration for the agreement to pay com- 
 pound interest. No consideration appears in the niemorandum un- 
 less it be an extension of the time for payment of interest implied by 
 the recognition of nonpayment from time to time by reason of the 
 provision that it should bear interest. Nothing is said specifically as to 
 extension of time, or concerning an agreement not to enforce pay- 
 ment of interest for a definite or indefinite period. While forbear- 
 ance to sue has always been recognized as an adequate consideration 
 for a promise made in reliance thereon, there must be an agreement 
 to that effect; mere forbearance without an agreement has been held 
 not a good consideration, because of there being nothing to prevent the 
 bringing of suit at any time. Clark v. Russel, 3 Watts, 213, 27 Am. 
 Dec 348; Sidwell v. Evans, 1 Pen. & W. 383, 21 Am. Dec. 387; Cobb 
 V. Page, 17 Pa. 469; Saalfield v. Manrow, 165 Pa. 114, 3D Atl. 823. 
 While it has been said that actual forbearance at the instance of a de- 
 fendant may also be sufficient (Clark v. Russel, supra),, yet, in such 
 case, the burden is on the one relying thereon to show by clear and 
 satisfactory proof that the request to forbear was, in fact, the inducing 
 cause of the act of forbearance. Clark v. Russel, supra. 
 
 In the present case the court below, in discussing this question, stated 
 there was an actual forbearance in the enforcement of the payment 
 of interest for a period of nearly four years, and such forbearance 
 was sufficient consideration for the agreement to pay compound inter- 
 est. The difficulty with this view of the case is that the record fails 
 to show the delay of four years in collecting the interest was piirsu- 
 ant to a request or promise made to the payee by the maker. Under 
 the circumstances there was no valid agreement to pay compound in- 
 terest, the sureties are not prejudiced, and there is nothing to effect their 
 discharge from liability. 
 
 The judgment is reversed, and the record remitted to the court below, 
 with directions to enter judgment against defendants for such sum as 
 to right and justice may belong, unless other legal or equitable cause be 
 shown to the court below why such judgment should not be entered. 
 
Sec- 3) FORBEAEANCE AS CONSIDERATION 265 
 
 ALLIANCE BANK v. BROOM. 
 (In the Court of Chancery, 1864. 2 Drew. & S. 289.) 
 
 This case came on upon a demurrer. 
 
 It appeared, from the bill, that in June, 1864, the Alliance Bank 
 opened a loan account with the defendants, who are merchants at Liv- 
 erpool, and that such loan account was continued down to September 
 19th, 1864, when there was a balance due from the defendants to the 
 bank on such loan account to the amount of i22,205 15s. Id. 
 
 On September 19th, 1864, the plaintiffs requested the defendants, 
 Messrs. Broom, to give them some security for the amount so due, 
 and the defendants, who stated that they were entitled to certain goodsy 
 wrote to the manager of the bank the following letter : 
 
 "Liverpool, September 19th, 1864. 
 
 "Dear Sir : We hand you the following particulars of produce, 
 which we propose to hypothecate against our loan account, and at the 
 same time undertake to pay the proceeds as we receive them, to the 
 credit of the said account." 
 
 The letter then contained a list of goods and their values, and was 
 signed by Messrs. Broom. 
 
 In pursuance of this letter the plaintiffs, on September 20th, 1864,. 
 applied to the defendants for the warrants for delivery of the goods 
 mentioned in the letter, and the defendants promised to deliver the 
 warrants to the plaintiffs as soon as they could obtain them from the 
 warehouses. 
 
 The bill stated that the defendants refused to deliver the warrants, 
 or other documents relating to the goods, to the plaintiffs, and threat- 
 ened and intended to deliver them to other persons ; arid the bill charg- 
 ed that the plaintiffs were entitled to a lien or charge upon the goods 
 mentioned in the letter by virtue of the agreement, and prayed for a 
 declaration to that effect. The bill also prayed that the defendants 
 might be ordered to deliver to the plaintiffs the warrants and other 
 documents relating to the title of said goods, and cause the said goods 
 to be delivered to the plaintiffs, by way of security for the amount due 
 to them on the loan account. The bill also prayed an injunction to re- 
 strain the defendants from dealing with the warrants or goods in the 
 mean time. 
 
 To this bill the defendants filed a demurrer, on the' ground that the 
 agreement contained in the letter was without consideration; and 
 therefore one which the Court would not enforce. 
 
 The VicE-ChancELIvOR : The defendant demurs to the plaintiff's bill 
 in this case, on the ground that the promise to give security, which the 
 plaintiff seeks to enforce, was without any consideration— that it is, in 
 fact, a nudum pactum, which the Court will not enforce ; and in sup- 
 port of this proposition it is argued that the plaintiffs, so far from giv- 
 ing any consideration for the promise, could at any time have brought 
 
266 OONSIDEKAXION (Ch. 2 
 
 an action for the payment of the debt; and that they 'could have done 
 so is perfectly true; 
 
 Now, according to the facts stated in the bill, a demand was made by 
 the creditor for security; and upon that demand a promise and agree- 
 ment was made by the debtor that he would give such security; and 
 that, although it rhight taEe some time to get the warrants, he would 
 hand them over to the creditor when he obtained them. 
 
 It appears to me, that when the plaintiffs demanded payment' of their 
 debt, and, in consequence of that application, the defendant agreed to 
 give certain security, although there was no promise on the part of the 
 plaintiffs to abstain for any certain time from suing for the debt, the 
 effect was, that the plaintiffs did, in effect, give, and the defendant re- 
 ceived, the benefit of some degree of forbearance ; not, indeed, for any 
 definite time, but, at all events, some extent of forbearance. If, on the 
 application for security being made, the defendant had refused to give 
 any security at all, the consequence .certainly would have been that the 
 creditor would have demanded payment of the debt, and have taken 
 steps to enforce it. It is very true that, at any time after the promise, 
 the creditor might have insisted on payment of his debt, and have 
 brought an action ; but the circumstances necessarily involve the bene- 
 fit to the debtor of a certain amount of forbearance, which he would 
 not have derived if he had not made the agreement. 
 
 On this ground the demurrer must be overruled. ^^ 
 
 STRONG v. SHEFFIELD. 
 
 (Court of Appeals of New York, 1895. 144 N. Y. 392, 39 N. E. 330.) 
 
 AndrEw^s, C. J. The contract between a maker or endorser of a 
 promissory note and the payee forms no exception to the general rule 
 that a promise, not supported by a consideration, is nudiim pactum. 
 The law governing commercial paper which precludes an inquiry into 
 the consideration as against bona fide holders for value before maturi- 
 ty, has no application where the suit is between the original parties to 
 the instrument. It is^ undisputed that the demand note upon which 
 the action was brought was made by the husband of the defendant 
 and endorsed by her at his request and delivered to the plaintiff, the 
 payee, as security for an antecedent debt owing by the husband to 
 the plaintiff. The debt of the husband was past due at the time, 
 and the only consideration for the wife's endorsement, which is 
 or can be claimed, is that as part of the transaction there was an 
 
 so See, in accord. In re All Star Feature Corp. (D. C.) 282 Fed. 1004 (1916^ 
 where Hand, J., said: "It is quite true that here there was no express ref; 
 erence to forbearance in the contract, and no statement that the lien was in 
 exchange for it, but the situation reasonably implied that the parties so in-, 
 tended it." Schoening v. Maple Valley Lumber Co., 61 Wash. 332, 112 Pac. 
 381 (1910). 
 
Sec. 3) FOEBEAEANCE AS CONSIDEEATION 267 
 
 agreement by the plaintiff when the note was given to forbear the 
 collection of the debt, or a request for forbearance, which was fol- 
 lowed by forbearance for a period of about two years subsequent to 
 the giving of the note. There is no doubt that ati agreenient by the 
 creditor to forbear the collection of a debt presently due is a good con- 
 sideration for an absolute or conditional promise of a third person to 
 pay the debt, or for any obligation he may assume in respect thereto. 
 Nor is it essential that the creditor should bind himself at the time to 
 forbear collection or to give time. If he is requested by his debtor to 
 extend the time, and a third person undertakes in consideration, of for- 
 bearance being given to become liable as surety or otherwise, and the 
 creditor does in fact forbear in reliance upon the undertaking, although 
 he enters into no en forcible agreement to do so, his acquiescence in the 
 request, and an actual forbearance in consequence thereof for a reason- 
 able time, furnishes a good consideration for the collateral undertak- 
 ing. In other words, a request followed by performance is sufficient, 
 and mutual promises at the time are not essential, unless it was the un- 
 derstanding that the promisor was not to be bound, except on condition 
 that the other party entered into an immediate and reciprocal obliga- 
 tion to do the thing requested. Morton v. Burn, 7 A. & E. 19 ; Wilby 
 V. Elgee, L. R., 10 C. P. 497; King v. Upton, 4 Grefeijl. (Me.) 387, 16 
 Am. Dec. 266; Leake on Con., p. 54; Am. Lead. .Cas., Vol. II., p. 96 
 et seq. and cases cited.*" The general' rule is clearly, and in the main 
 accurately, stated in the note to Forth v. Stanton (1 Saund. 210, note 
 b). The learned reporter says: "And in all cases _ of forbearance to 
 sue, such forbearance must be either absolute or for a definite time, 
 or for a reasonable time ; forbearance for a little, or for some time, is 
 not sufficient." The only qualification to be made is that in the ab- 
 sence of a specified time a reasonable time is held to be intended. Ol- 
 dershaw v. King, 2 H. & N. 517; Calkins v. Chandler, 36 Mich. 320, 
 24 Am. Rep. 593. The note in question did not in law extend the 
 payment of the debt. It was payable on demand, and although being 
 payable with interest it was in form consistent with an intention that 
 payment should not be immediately demanded, yet there was nothing 
 on its face to prevent an immediate suit on the note against the maker 
 or to recover the original debt. Merritt v. Todd, 23 N. Y. 28, 80 Am. 
 Dec. 243; Shutts v. Fingar, 100 N. Y. 539, 3 N. E. 588, 53 Am. Rep. 
 231. 
 
 In the present case' the agreement made is not left to inference, nor 
 was it a case of request to forbear, followed by forbearance, in pur- 
 suance of the request, without any promise on the part of the creditor 
 
 *o In some cases it has been held that mere forbearance cannot be a con- 
 sideration and that there must be a promise to forbear, whoUir overlooking 
 the possibility of a unilateral contract. See Manter v. Churchill, 127 Mass. 31 
 (1879) : Shupe v. Galbraith, 32 Pa. 10 (1858); Lambert v. Clewley, 80 Me. 480, 
 15 Atl 61 (1888) ; Smith v. Bibber, 82 Me. 34, 19 Atl. 89, 17 Am. St. Rep. 464 
 (1889). But see Moore v. McKenney, 83 Me. 80, 21 Atl. 749, 23 Am. St. Rep. 
 753 (1890), 
 
2(J8 CONSIDERATION (Ch. 2 
 
 at the time. The plaintiff testified that there was an express agree- 
 ment on his part to the effect that he would not pay the note away, nor 
 put it in any bank for collection, but (using the words of the plaintiff) 
 "I will hold' it until such time as 1 want my money, I will make a de- 
 mand on you for it," ' And again: "No, I will keep it until such time 
 as I want it." Upon this alleged agreement the defendant endorsed 
 the note. It would have been no violation of the plaintiff's promise if, 
 immediately on receiving the note, he had commenced suit upon it. 
 Such a suit would have been an assertion that he wanted the money 
 and would have fulfilled ihe condition of forbearance. The debtor 
 and the defendant, when they became parties to the note, may have had 
 the hope or expectation that forbearance would follow, and there was 
 forbearance in fact. But there was no agreement to forbear for a fix- 
 ed time or for a reasonable time, but an agreement to forbear for such 
 time as the plaintiff should elect. The consideration is to be tested by 
 the agreement, and not by what was done under it. It was a case of 
 mutual promises, and so intended. We think the evidence failed to dis- 
 close any consideration for the defendant's endorsement, and that the 
 trial Court erred in refusing so to rule. 
 
 The order of the General Term reversing the judgment should be 
 affirmed, and judgment absolute directed for the defendant on the stip- 
 ulation with costs in all courts. 
 
 All concur, except Gray and Barti^EM , JJ., not voting, and Haight, 
 J., not sitting. 
 
 Ordered accordingly. 
 
 BARNARD v. SIMONS. 
 (1617. 1 Roll. Abr. f . 26, pi. 39 ; 1 Vin. Abr. 312, pi. 39.) 
 
 If A. makes a void assumpsit to B., and then a third party comes to 
 B. and promises to pay him £10 in consideration that B. will relinquish 
 the assumpsit made to him by A., there is no valid consideration to 
 charge him on the promise, because the first assumpsit was void. 
 
 LOYD V. EEE. 
 (At Nisi Prius, before Pratt, C. J., 1718. 1 Strange, 94.) 
 
 A married woman gives a promissory note as a feme sole; and 
 after her husband's death, in consideration of forbearance, promises 
 to pay it. And now in an action against her it was insisted that though 
 she being under covertui-e at the time of giving the note, it was void- 
 able for that reason; yet by her subsequent promise, when she was 
 of ability to make a promise, she had made herself ■ liable, and the 
 forbearance was a new consideration. But the Chief Justice held 
 the contrary, and that the note was not barely voidable, but abso- 
 
Sec. 3) FORBEARANCE AS CONSIDERATION 269 
 
 lutely void; and forbearance, where originally there is no cause of 
 action, is no consideration to raise an assumpsit. But he said it might 
 be otherwise where the contract was but voidable. And so the plain- 
 tiff was called. 
 
 BIDWELL V. CATTON. 
 (In the King's Bench. 1618. Hobart, 216.) 
 
 Bidwell, an attorney, brought an action of the case against Cat- 
 ton, executor of Reve, and counted, that whereas he had in Michael- 
 mas term 14 Jac. prosecuted an attachment of privilege against Reve 
 the Testator, retornable in Hil. term, the testator knowing of it, in 
 consideration that at his request, the plaintiff would forbear to pros- 
 ecute the said writ any farther against the testator, the testator did 
 promise to pay him fifty pounds, and then avers, &c. And after a 
 verdict it was excepted in arrest of judgment. 
 
 First, that it was not alledged, that the plaintiff had any just cause 
 of action. 
 
 Secondly, that this action still remains. 
 
 Thirdly, that this kind of action would not lie against an executor, 
 because it is not in the nature of a debt. 
 
 But THE' Court nevertheless gave judgment : For first, suits are not 
 presumed causeless, and the promise argues cause, in that he desired 
 to stay off the suit. Quaere, if the defendant had averred that there 
 was no cause of suit. 
 
 Secondly, though this did not require a discharge of the action, yet it 
 requires a loss of the writ, and a delay of the suit, which was both 
 a benefit to the one, and a loss to the other. 
 
 Thirdly, it was agreed, that if the testator promise to build an house, 
 or to do some such collateral act, that an assumpsit upon that will not 
 lie against the executor. But the Court held an action of debt would 
 well lie against the testator for the fifty shillings, • being a sum of 
 money due upon a contract in which he received quid pro quo; for 
 the forbearing of a suit is as beneficial in saving, as some other things 
 would have been in gaining. And 17 E. 4. If a man promise a chir- 
 urgeon money to cure a poor man, he shall have an action of debt 
 for it. 
 
 WADE V. SIMEON. 
 (In the Common Pleas, 1846. 2 O. B. 548.) 
 
 Assumpsit.*^ The first count of the declaration stated that the 
 plaintiff had brought a previous suit against the defendant in the 
 court of Exchequer, to recover two sums amounting to £2,000 ; that is- 
 sue was joined in said action, and trial set for December 7, 1844; 
 
 *i The statement has been condensed and concurring opinions are omitted. 
 
270 CONSIDERATION (Ch. 2 
 
 that the defendant had notified the plaintiff that he would apply to 
 the Chancery for, an injunction ; that thereupon, on the day before 
 the day set for trial, in consideration that the plaintiff would forbear 
 prosecuting and would stay all proceedings in the said action until 
 December 14, 1844, the defendant promised the plaintiff that he would 
 on that day pay the sum of £2,000 with interest and costs, and that 
 the application for an injunction should be abandoned. The plaintiff 
 averred that he had forborne to prosecute until December 14, and had 
 stayed all proceedings, but the defendant had failed and refused to pay 
 as agreed and had prevented the plaintiff from getting any judgment 
 in the action that had been brought. * * * 
 
 Fourth plea, — to the first count, — that the plaintiff never had any 
 cause of action against the defendant in respect to the, subject-matter 
 of the action in the'Court of Exchequer in that count mentioned; which 
 he the plaintiff, at the time of the commencement , of the action, and 
 thence until and at the time of the making of the promise in the said 
 first count mentioned, well knew— Verification. * * * 
 
 Special demiirrer to the fourth plea, * * * 
 
 The defendant joined in demurrer. 
 
 TiNDAL, C. J. The only question now remaining is upon the demur- 
 rer to the fourth plea. I am of opinion that the fourth plea is a good 
 and valid plea, on general demurrer. The declaration alleges that the 
 plaintiff had commenced an action against the defendant in the Ex- 
 chequer, to recover two sums of £1,300 and £700, respectively, which 
 action was about to betried^ and that, in consideration that the plain- 
 tiff would forbear proceeding in that action, until the 14th of De- 
 cember then next, the defendant promised the plaintiff that he would 
 on that day pay the money, with interest, and costs; that the plain- 
 tiff, confiding in the defendant's promise, forbore prosecuting the 
 action, and stayed the proceedings until the day named; but that 
 defendant did not pay the money or the costs. The fourth plea states 
 that the plaintiff never had any cause of action against the defend- 
 ant in respect of the subject-matter of the action in the Court of Ex- 
 chequer, which he, the plaintiff, at the time of the commencement of 
 the said action, and thence until the time of the making the promise in 
 the first count mentioned, well knew. By demurring to that plea, the 
 plaintiff admits that he had no cause of action against the defendant 
 in the action therein mentioned, and that he knew it. It appears to 
 me, therefore, that he is estopped from saying that there was any 
 valid consideration for the defendant's promise. It is almost contra 
 bonos mores, and certainly contrary to all the principles of natural 
 justice, that a man should institute proceedings against another, when 
 he is conscious that he has no good cause of actioii. In order to con- 
 stitute a binding promise, the plaintiff must show a good considera- 
 tion, somewhat beneficial to the defendant, or detrimental to the plain- 
 tiff. Detrimental to the plaintiff it cannot be, if he has no cause of 
 action; and beneficial to the defendant it capnot be; for, in con- 
 
Sec. 3) PORBFARANCE AS COlJISIDERATION . 271 
 
 templation of law, the defence upon such an admitted state of facts 
 must be successful, and the defendant will recover costs, which must 
 be assumed to be a full compensation for all the legal damage he may 
 sustain. The consideration, therefore, altogether fails. On the part 
 of the plaintiff it has been urged that the cases cited for the defend- 
 ant were not cases where actions had already been brought, but only 
 cases of promises to forbear commencing proceedings. I must, how- 
 ever, confess that, if that were so, I do not see that it would make any 
 substantial difference. The older cases, and some of the modern ones 
 too, do not afford any countenance to that distinction. In Tooley 
 V. Windham (Cro. Eliz. 206, more fully reported, 2 Leon. 105), it is 
 stated that the plaintiff had purchased a writ out of Chancery against 
 the defendant, to the intent to exhibit a bill against him; upon the 
 return of the writ, which was for the profits of certain lands,, which 
 the father of the defendant had taken in his lifetime, the defendant, 
 in consideration he would surcease his suit, promised to him, that, if 
 he could prove that his father had taken the profits, or had the posses- 
 sion of the land under the title of the father of the plaintiff, he would 
 pay him for the profits 6i the land: and the court held that the 
 promise was without consideration, and void. There the suit was in 
 existence at the time of the making of the promise. So, in Atkinson 
 V. Settree (Willes, 482), an action had been commenced at the time 
 the promise was made. These cases seem to me to establish the prin- 
 ciple upon which our present judgment rests; and I am not aware 
 that it is at all opposed by Longridge v. Dorville (5 B. & Aid. 117). 
 It may be that the .peculiar circumstances of that case took it out of 
 the general rule. The ship was under detention by virtue of process 
 from the Admiralty Court; the event of the suit in that court was 
 uncertain; neither party could foresee the result; and therefore the 
 relinquishment by 'the plaintiff of his hold upon the ship might well 
 be a good consideration for the promise declared on. Here, how- 
 ever, diere was no uncertainty : the defendant asserts, and the plaintiff 
 admits, that there never was any cause of action in the original suit, 
 and that the plaintiff knew it. I therefore think the fourth plea af- 
 fords a very good answer, and that the defendant is entitled to judg- 
 ment thereon.*^ 
 
 *2 In accord: Majors v. Majors, 92 Neb. 473, 138 N. W. 574 (1912) ; Nichol- 
 son V. Neary, 77 Wash. 294, 137 Pac. 492 (1914), forbearance to sue on a note 
 void for lack of consideration ; Osborne v. Fridrich, 134 Mo. App. 449, 114 S. 
 W. 1045 (1908), on a note known to be void for usury. 
 
272 CONSIDERATION (Ch. 2 
 
 SPRINGSTEAD et al. v. NEES et al. 
 
 (Supreme Court, Appellate Division, of New York, 1908. 125 App. Div. 230, 109 
 
 ,N. Y. Supp. 148.) 
 
 Action by Anna Springstead and others against George Nees and 
 another. Judgment for defendants, and plaintiffs appeal. Affirmed. 
 
 Jbnks, J. This action was tried by stipulation as a common-law ac- 
 tion before the court without a jury. The parties are all of the surviv- 
 ing children of Nees, deceased, who died intestate, leaving them his 
 sole heirs at law. Ne^s died, the owner and seised of realty called the 
 "Sackett Street Property" and the owner of realty,, called the "At- 
 lantic Avenue Property," which he held by deed to him as trustee for 
 his children, Sophia and George. Shortly after Nees' death all of the 
 parties, an attorney at law, and friends met in Nees' house. Nees' 
 strong box was opened, and when the deed to the Atlantic avenue prop- 
 erly was found therein the attorney handed it to Sophia, saying: 
 "This is yours." The evidence for the plaintiffs is that they, or some 
 of them, were surprised to learn that this deed was to their father in 
 trust for two of the children; for thereto'fore they had believed that 
 he was the owner and seised in fee. They expressed their surprise, 
 and there were murmurings. Thereupon Sophia spoke up, saying, 
 "We will give you our share in the Sackett street property if you 
 don't bother us about the Atlantic avenue property," and George as- 
 sented. The Sackett street property was sold thereafter. This action 
 is brought by the other three children against Sophia and George, up- 
 on that alleged promise of Sophia and George, to recover their propor- 
 tionate share of the proceeds of that sale. Sophia and George testified 
 that no such promise ever was made. The learned court gave judg- 
 ment for the defendants, dismissing the complaint, with costs. 
 
 After finding the preliminary facts, which were not disputed, the 
 court found that the defendants, after the death of their ' father, were 
 seised in fee simple of the Atlantic avenue property and held indefeasi- 
 ble title thereto ; that the plaintiffs had no color of right in the Atlan- 
 tic avenue property, and did not at any time threaten or atfempt to as- 
 sert any claim of right hostile to the defendants in that property ; that 
 there was no compromise, either wholly or partly executed, between 
 the parties, afifecting rights which the plaintiffs might have in that 
 property; that the plaintififs had given up no rights in that property, 
 nor had they changed their position therein ; and that a promise (re- 
 ferring to which I have heretofore described as shown by the testimbny 
 for the plaintiffs) made by the defendants to the plaintififs that, if the 
 plaintififs "would not 'molest,' or 'bother,' or 'make a fuss' about, the 
 defendants' rights on the Atlantic avenue property, the defendants 
 would give the plaintififs their share in the Sackett street property, if 
 made, would have been without consideration." The plaintififs appeal. 
 
 The record sustains the facts found. Assuming that such promise 
 was made, I am of opinion that there was no consideration shown. In 
 
Sec. 3) FORBEARANCE AS CONSIDERATION 273 
 
 Rector, etc., v. Teed, 120 N. Y. 583, 24 N. E. 1014, Vann, J., for the 
 court says (pages 586, 587 of 120 N. Y., page 1015 of 24 N. E.): 
 
 " 'A valuable consideration may consist of some right, interest, profit, 
 or benefit accruing to one party, or some forbearance, detriment, loss, 
 or 'responsibility given, suffered, or londertaken by the other.' 3 Am. 
 & Eng. Cyclopedia of Law, 831; Currie v. Misa, L. R. 10 Ex. 162; 
 Chitty on Cont. (9th Am. Ed.) 29; 2 Kent's Comm. 465. It is not 
 essential that the person to whom the consideration moves, should be 
 benefited, provided the person from whom it moves is in a legal sense 
 injured. The injury may consist of a compromise of a disputed claim 
 or forbearance to exercise a legal right ; the alteration in position be- 
 ing regarded as a detriment that forms a consideration independent of 
 the actual value of the right forborne." 
 
 The consideration for the promise cannot be found in the fact that 
 there was a compromise of a disputed claim, for there is no evidence 
 thereof. It must rest, then, upon the forbeai^aftce to exercise a legal 
 right. Forbearance to assert either a legal or an equitable claim is 
 sufficient consideration, as we have seen. See. also, Wharton on Con- 
 tracts, § 532, and authorities cited; Leake on Contracts (Randall's 
 Ed.) 438; 1 Parsons on Contracts (15th Ed.) p. 441. It seems un- 
 necessary to consider the conflict over the question whether forbear- 
 ance ais to a claim without foundation can constitute good considera- 
 tion. See 1 Parsons on Contracts (8th Ed.) p. 441, note, discussing 
 the variovts authorities. It seems to be the rule with us that it is not es- 
 sential that the claim should be valid ; but it is enough if it could be 
 regarded as doubtful or colorable. In White v. Hoyt, 73 N. Y. 515, 
 the court cites the language of Richardson v. Mellish, 2 Bing. 229 : "It 
 is not necessary that the party should have a right to hold, if he be 
 doubtful whether he has a right to hold" — and of Mr. Chitty, when "he 
 describes a claim as "colorable." See. Cox v. Stokes, 156 N. Y. 491- 
 505, 51 N. E. 316; Zoebisch v. Von Minden, 120 N. Y. 406-419, 24 
 N. E. 795. But if the claim be not even doubtful, or colorable, or 
 plausible, in that there is no reason for an honest belief that it has 
 some foundation in law or in equity, then forbearance applied to it is 
 not good consideration. Parsons in his final note (ut supra) says : 
 
 "In all jurisdictions it would be admitted that forbearance of a 
 claim is no consideration, if the claimant knows his claim to be un- 
 founded or conceals material facts relating thereto"- — citing authorities. 
 
 Wharton on Contracts, § 532, says : 
 
 "The fact that the suit is not well founded makes no difference, if it 
 has a show of title though it is otherwise in cases of fraud, and in cas- 
 es where the claim to be forborne is utterly destitute of support." 
 
 See, too. Parsons, supra; Bishop on Contracts, § 63, and note; 
 Wald's Pollock on Contracts, p. 214; Leake on Contracts, p. 439; 
 Smith on Contracts (7th .Ed.) p. 187, note 1. 
 
 In the case at bar the court, as I have said, found properly that the 
 plaintiffs had no color of right in the Atlantic avenue property; nor 
 CoBBiN Cont — 18 
 
274 CONSIDERATION (Ch. 2 
 
 did they at any time threaten or attempt to assert any claim. The evi- 
 dence of the plaintiffs is that, when they were surprised to find that 
 the deed to the Atlantic avenue property was in trust for but two of 
 their number, thereupon and without any further reason, save that they 
 expressed surprise and were dissatisfied, the defendants made the 
 promise in question. The .promise was not even in response to any 
 suggestion of any possible claim then or thereafter against the deed, 
 or despite it, or of any action adverse to it. There was no suggestion, 
 then or at any time thereafter, made that the deed was invalid for any 
 reason, or of any ground upon which it was open to attack. Indeed, I 
 can discover no reason upon the evidence how any of the parties could 
 seriously suppose that even a doubtful or a colorable claim could be 
 asserted then or thereafter. It does not appear that anything was ev- 
 er done, then or thereafter, in consequence of the alleged promise, or 
 that the rights of the parties were in any way thereby changed or af- 
 fected. 
 
 I think that the judgment must be affirmed, with costs. AH concur, 
 except 
 
 Hooker, J. (dissenting)^. The circumstajnces surrounding the open- 
 ing of the strong box after decedent's death and the finding there of a 
 deed running to the defendants, and the conversation th'en between 
 the children, seem to me such as to present a situation where there 
 was at least color of a valid claim by the plaintiffs, by reason of their 
 heirship, to the Atlantic avenue property. One of these circumstances 
 is that the strong box where the deed was found belonged to the de- 
 cedent, and it might well be doubted whether there had ever been a de- 
 livery of the deed before the grantor's death, which was necessary to 
 pass title. If such claim was open to be urged, there was considera- 
 tion for the promise. 
 
 The judgment should be reversed. 
 
 COOK et al. v. WRIGHT. 
 (In the Queen's Bench, 1861. 1 Best & S. 559.) 
 
 Action on two promissory notes. The plaintiffs, as commissioners 
 acting under the Whitechapel improvement act, had expended money 
 in paving streets adjoinmg certain houses owned by one Mrs. Bennett, 
 a nonresident. One of the houses was occupied by the defendant as 
 tenant, and he acted as Mrs. Bennett's agent in collecting rents on the 
 other houses and in paying taxes. The defendant informed the plain- 
 tiffs of these facts, and they nevertheless believed that the defendant 
 was the person described in the improvement act as the owner against 
 whom the charges for paving should be assessed. The defendant in- 
 sisted that he was not bound to pay under the act ; but when the plain- 
 tiffs threatened proceedings against him he induced the plaintiffs to 
 reduce the amount of the charges and to give further time for payment, 
 in return for his giving the notes now sued upon. 
 
Sec. 3) FORBEARANCE AS CONSIDERATION 275 
 
 At the trial. a verdict was entered for the defendant, with leave to 
 move to enter a verdict for the plaintiff. In pursuance of such leave, 
 a rule to show cause was obtained on the ground that there was a suf- 
 ficient consideration shown by the evidence and that the plaintiff was 
 entitled to a verdict.*^ 
 
 Blackburn, J. In this case it appeared on the trial that the defend- 
 ant was agent for a Mrs. Bennett, who was nonresident owner of hous- 
 es in a district subject to a local act. Works had been done in the ad- 
 joining street by the commissioners for executing the act, the ex- 
 penses of which, under the provisions of their act, they charged on the 
 owners of the adjoining houses. Notice had been given to the defend- 
 ant, as if he had himself been owner of the houses, calling on him to 
 pay the proportion chargeable in respect of them. He attended at a 
 board meeting of the commissioners, and objected both to the amount 
 and nature of the charge, and also stated that he was not the owner of 
 the houses, and that Mrs. Bennett was. He was told that, if he did 
 not pay, he would be treated as one Goble had been. It appeared that 
 Goble had refused to pay a sum charged against him as owner of some 
 houses, and the commissioners had taken legal proceedings against him, 
 and he had then submitted and paid, with costs. In the result it was 
 agreed between the commissioners and the defendant that the amount 
 chgjrged upon him should be reduced, and that time should be given to 
 pay it in three instalments. He gave three promissory notes for the 
 three instalnients. The first was duly honoured ; the others were not, 
 and were the subject of the present action. At the trial it appeared 
 that the defendant was not in fact owner of the houses. As agent for 
 the owner he was not personally liable under the act. In point of law, 
 therefore, the commissioners were not entitled to claim the money 
 from him; but no case of deceit was alleged against them. It must be 
 taken that the commissioners honestly believed that the defendant was 
 personally liable, and 'really intended to take legal proceedings against 
 him, as they had done against Goble. The defendant, according to' his 
 own evidence, never believed that he was liable in law, but signed the 
 notes in order to avoid being sued as Goble was. Under these cir- 
 cumstances the substantial question reserved (irrespective of the form 
 of the pilea) was whether there was any consideration for the notes. 
 We are of opinion that there was. 
 
 There is no doubt that a bill or note given in consideration of what 
 is supposed to be a debt is without consideration if it appears that 
 there was a mistake in fact as to the existence of the debt (Bell v. 
 Gardiner, 4 Man. & G. 11), and, according to the cases of Southall v. 
 Rigg and Forman v. Wright, 11 C. B. 481, the law is the same if the 
 bill or note' is given in consequence of a mistake of law as to the ex- 
 istence of the debt. But here there was no mistake on the part of the 
 defendant, either of law or fact. What he did was not merely the 
 
 i" This statement is condensed from the original report. 
 
276 CONSIDERATION (Ch. 2 
 
 making an erroneous account stated, or promising to pay a debt for 
 Vvhich he mistakenly believed himself liable. It appeared on the evi- 
 dence that he believed himself not to be liable, but he knew that the 
 plaintiffs thought him liable, and would sue him if he did not pay, and 
 in order to avoid the expense and trouble of legal proceedings against 
 himself he agreed to a compromise; and the question is, whether a 
 person who has given a note as a compromise of a claim honestly made 
 on him, and which but for that compromise would have been at once 
 brought to a legal decision, can resist the, payment of the note on the 
 ground that the original claim thus compromised might have. been suc- 
 cessfully resisted. 
 
 If the suit had been actually commenced, the point would have been 
 concluded by authority. In L,ongridge v. Dorville, 5 B. & Aid. 117, it 
 was held that the compromise of a suit instituted to try a doubtful 
 question of law was a sufficient consideration for a promise. In Atlee 
 V. Backhouse, 3 M. & W. 633, where the plaintiff's goods had been 
 seized by the excise, and he had afterward entered into an agreement 
 with the Commissioners of Excise that all proceedings should be ter- 
 minated, the goods delivered up to the plaintiff,, and a sum of money 
 paid by him to the commissioners, Parke, B., rests his judgment (page 
 650) on the ground that this agreement of compromise honestly made 
 was for consideration and binding. In Cooper v, Parker, 15 Com. B. 
 822, the Court of Exchequer Chamber held that the withdrawal of an 
 untrue defence of infancy in a suit, .with payment of costs, was a suf- 
 ficient consideration for a promise to accept a smaller sum in satisfac- 
 tion of a larger. 
 
 In these cases, however, litigation had been actually commenced ; 
 and it was argued before us that this made a difference in point of 
 law, and that though, where a plaintiff has actually issued a writ 
 against a defendant, a compromise honestly made is binding, yet the 
 same compromise, if made before the writ actually issues, though the 
 litigation is impending is void. Edwards v. Baugh, 11 M. & W. 641, 
 was relied upon as an authority for this proposition. But in that case 
 Lord Abinger expressly bases his judgment (pages 645, 646) on the as- 
 sumption that the declaration did not, either expressly or impliedly, 
 show that a reasonable doubt existed between the parties. It may be 
 doubtful whether the declaration in that case ought not to have been 
 construed as disclosing a compromise of a real bona fide claim, but it 
 does not appear to have been so construed by the Court. We agree 
 that unless there was a reasonable claim on the one side, which it was 
 bona fide intended to pursue, there would be no ground for a compro- 
 mise ; but we cannot agree that (except as a test of the reality of the 
 claim in fact) the issuing of a writ is essential to the validity of the 
 compromise. The position of the parties must necessarily be altered 
 in every case of compromise, so that^ if the question is afterward open- 
 ed up, they cannot be replaced as they were before the compromise. 
 The plaintiff may be in a less, favorable position for renewing his litl- 
 
'^^^^ ^) FORBEARANCE AS CONSIDERATION ' , 277 
 
 gation, he must be at anjadditional trouble and expense in again getting 
 up his case, and he may no longer be able to produce the evidence 
 which would have proved it originally. Besides, though he may not 
 an point of law be bound to refrain from enforcing his rights against 
 third persons during the continuance of the compromise, to which they 
 are not pa.rties, yet practically the effect of the compromise must be to 
 prevent his doing so. For instance, in the present case, there can be 
 no doubt that the practical effect of the compromise must have been to 
 induce the commissioners to refrain from taking proceedings against 
 Mrs. Bennett, the real owner of the houses, while the notes given by 
 the defendant, her agent, were running ; though the compromise might 
 have afforded no ground of defence had such proceedings been re- 
 sorted to. It is this detriment to the party consenting to a compromise 
 arising from the necessary alteration in his position which, in our opin- 
 ion, forms the real consideration for the promise, and not the tech- 
 nical and almost illusory consideration arising from the extra costs of 
 litigation. The real consideration therefore depends, not on the actual 
 commencement of a suit, but on the reality of the claim made and 
 the bona fides of the compromise. 
 
 In the present case we think that there was sufjScient consideration 
 for the notes in the cornpromise made as it was. 
 
 The rule to enter a verdict for the plaintiff must be made absolute. 
 , Rule absolute. 
 
 PROUT V. INHABITANTS OF FIRE-DIST. OF TOWN OF 
 
 PITTSFIELD. 
 
 < Supreme Judicial Court of Massachusetts, 1891. 154 Mass. 450, 28 N. E. 679.) 
 
 Action of contract by Florence Prout against the Inhabitants of the 
 JFire-District of the Town of Pittsfield on an offer of compromise, and 
 an acceptance thereof, of a claim which plaintiff had against defend- 
 ant. Judgment for plaintiff and defendant appeals. Affirmed. 
 
 Allen, J*. The defendant is a fire-district, duly organized and es- 
 tablished under the general laws; of the commonwealth. St. 1844, c. 
 152; Pub. St. c. 35, §§ 40-61. By express provision of statute, fire- 
 districts may raise money for the purchase of engines and other arti- 
 cles necessary for the extinguishment of fires, for the purchase of 
 land, for the erection and repairs of necessary buildings, for the erec- 
 tion and maintenance of street lamps within their limits, and for other 
 incidental expenses of the fire department. Pub. St. c. 35, § 51. Cer- 
 tain other powers were specially conferred' upon the defendant by the 
 legislature, in respect to water supply and to sewers; and drains. St. 
 1854, c. 210; St. 1867, c. 132. By virtue of its general authority, de- 
 fendant established an electric fire-alarm system, one of the wires ,of 
 which ran into the house where the plaintiff lived, and during a thun- 
 der-storm she was injured by electricity ; conducted into thp l^ouse by 
 
278 CONSIDEEATION (Ch. 2 
 
 means of the wire. It is not controverted that the establishment of the 
 fire-alarm system was within the defendant's authority. The plaintiff 
 sued the defendant for this injury, and obtained a vefdict, with sub- 
 stantial damages, in the superior court, under instructions from the 
 presiding justice authorizing the same to be rendered. Exceptions 
 were takfen to these instructions, and before the same were argued in 
 this court the defendant passed the vote which is the subject of the 
 present action, appropriating a sum less than the verdict to be paid in 
 compromise of the action and claim, and the plaintiff accepted the 
 vote and the offer therein contained. 
 
 The defendant now contends that it was not liable' in the first in- 
 stance for any negligence of the fire department, or of its members and 
 officers, and that it was wholly beyond its power to assume liability 
 therefor by a compromise of the plaintiff's claim. This latter ground 
 of objection is clearly untenable, and we have therefore no occasion to 
 consider the former. The defendant, as a fire-district, is a quasi cor- 
 poration, with certain limited corporate powers, which are to be meas- 
 ured by its other powers, its privileges and duties. Among its inher- 
 ent corporate powers is the power to sue and be sued. School-Dist. v. 
 Wood, 13 Mass. 193; Stebbins v. Jennings, 10 Pick.; 173, 188; Line- 
 han V. Cambridge, 109 Mass. 212; 2 Kent, Comm. 277, 278, 283, 284, 
 and notes; Ang. & A. Corp. §§:23, 24,78; Dill. Mun. Corp. §§ 21, 22. 
 The general power to compromise doubtful and disputed claims is nec- 
 essarily incident to the power to sue and the liability to be sued. If a 
 claim against the defendant cannot be adjusted by way of compro- 
 mise, neither could a claim in its favor. If this doctrine were applied 
 generally to all claims, the result would be that in all disputed cases 
 the defendant must perforce engage in a litigation, the expense of 
 which would be certain, but the result doubtful. The defendant would 
 be under the necessity of insisting at all hazards upon a judicial de- 
 termination of all its controverted rights, and would be bound to pur- 
 sue or resist all doubtful claims until final adjudication by the court 
 of last resort. 
 
 The learned counsel for the defendant does not carry "his objection 
 so far as this, but he contends that liability for negligence of the kind 
 now in question is so far removed from any obligation imposed upon 
 the defendant by law that it was entirely outside of its power to as- 
 sume any such liability, even by way of compromise. This argument 
 overlooks the ground upon which compromises rest and are upheld 
 by courts. Whether the result of a litigation depends chiefly upon the 
 ascertainment of the facts by the verdict of a jury, or upon the de- 
 termination of the rules of law found applicable by the court, in either 
 case there is an uncertainty until the decision is reached. No better 
 illustration could be needed than the present case affords. The coun- 
 sel for the defendant asks us to say that the rules of law so clearly ex- 
 empted the fire-district from liability that a settlement of the claim by 
 way of compromise was ultra vires. But the learned justice of the 
 
Sec. 3) FORBEARANCE AS CONSIDERATION 279 
 
 superior court ruled that the fire-district might be held liahle. It cer- 
 tainly could not be said, therefore, that the law was so plain as to be 
 free from doubt.** It must at least be assumed that the defendant was 
 involved in a litigation in which the result niight be adverse to it. If 
 the defendant had chosen to rest content with the verdict of the jury 
 and the ruling of the judge of the superior court, there would have 
 been a final judicial determination that it was liable. Could it be 
 urged, in such a case, that it would be beyond its powers to raise mon- 
 ey to pay the judgment against it? Or could it be urged that it would 
 be beyond its powers to submit to the result in the superior court, with- 
 out taking or pressing in this court exceptions in matters of law ? 
 
 \A^hat the defendant has done is, in effect, to agree to waive its ex- 
 ceptions taken at the trial in consideration that the plaintiff will accept 
 a sum less than the verdict of the jury. This verdict was rendered in 
 the due course of the administration of justice. Although subject to 
 be set aside upon a further hearing in this court of the matters of law 
 involved in the case, it was prima facie an obligation resting upon the 
 defendant, which it was in great danger of being compelled to meet. 
 Certaihly the plaintiff's claim cannot be said to be merely frivolous or 
 vexatious, or one not urged in good faith. It must be conceded that 
 the plaintiff, or those acting for her, rnight well believe in its justice 
 and legality, since the court and jury have upon a trial upheld it. 
 There is no suggestion of fraud or misrepresentation practiced on the 
 defendant. Under these circumstances, we can see no good ground 
 for holding that the compromise was beyond the power of the fire-dis- 
 ti-ict, or that its promise to pay was founded on no sufficient consider- 
 ation. The power is incident to its liability to be sued. Gushing v. 
 Stoughton, 6 Cush. 389 ; Drake v. Stoughton, 6 Cush. 393 ; Matthews 
 V. Westborough, 131 Mass. 521, Id., 134 Mass. 555; Medway v. Mil- 
 ford, 21 Pick. 349, 354; Bean v. Jay, 23 Me. 117; Petersburg v. Map- 
 pin, 14 111. 193, 56 Am. Dec. 501 ; Agnew v. Brail, 124 111. 312, 16 N. 
 E. 230; Supervisors v. Bowen, 4 Lans. (N. Y.) 24, 30, 31; Super- 
 visors V. Birdsall, 4 Wend. (N. Y.) 453 ; 1 Dill. Mun. Corp. §§ 30, 477, 
 478. 
 
 The plaintiff's claim, whether on a final determination it might or 
 might not be found to be valid, was suffi^riently substantial to furnish 
 a good consideration for the compromise. Barlow v. Insurance Co., 4 
 Mete. 270; Cobb v. Arnold, 8 Mete. 403; AUis v. Billings, 2 Cush. 
 19, 25, 26; Leach v. Fobes, 11 Gray, 506, 71 Am. Dec. 732; Kerr v. 
 Lucas, 1 Allen, 279; Easton v. Easton, 112 Mass. 438, 443; Riggs v. 
 Hawley, 116 Mass. 596; Wilton v. Eaton, 127 Mass. 175; Bank v. 
 Geary, 5 Pet. 99, 114, 8 L. Ed. 60; Miles v. New Zealand Alford Est. 
 Co., 32 Ch. Div. 266, 283, 284, 291, 292, 297, 298; Ex parte Banner, 
 17 Ch. Div. 480; Callisher v. Bischoffsheim, L. R. 5 Q. B. 449; Cook 
 
 44 The rule of law generally followed is that a municipal corporation is not 
 bound to pay for injuries caused by the operation of its fire department. A 
 few cases have held contra. See 29 Yale L. Jour. 911. 
 
280 CONSIDERATION (Ch. 2" 
 
 V. Wright, 1 Best & S. 559; Mete. Cont. 177; Poll: Cont. 18,1, 182, 
 407; Chit. Cont. (Uth Amer. Ed.) 35-41, 46-50. The case of Palfrey, 
 V. Railroad Co., 4 Allen, 55, is to be distinguished on the ground that 
 •there it was plain that the plaintiff had no real claim to be compro- 
 mised ; and Wade v. Simeon, 2 C. B. 548, rests on the same ground. The 
 defendant's further objection that the plaintifif has given no complete 
 and unreserved acceptance of the defendant's yote cannot prevail.; 
 The plaintiff's acceptance was complete and unreserved, but the de- 
 fendant's prudential committee sought to repudiate the defendant's 
 vote, the effect of which, if successful, would be to leave the plaintiff's 
 original action as it was. The plaintiff has never withdra-ysirn from its- 
 agreement to accept the sum voted by the defendant in full satisfac- 
 tion of all her claims. 
 Judgment for the plaintiff affirmed.*' 
 
 BLOUNT V. WHEELER et al. 
 
 (Supreme Judicial Court of Massachusetts, 1908. 199 Mass. 330, 85 N. E. 477, 
 17 L. H. A. [N. S.] 1036.) 
 
 Suit by Edith Eliza Dillaway Blount against Frank Henry Dillaway 
 and Frank A, Wheeler to compel specific performance Of an agree- 
 ment of comproriiise. Decree for plaintiff, and defendants appeal. 
 Affirmed. > 
 
 LoEiNG, J.*" This is a bill brought by a sister against her brother 
 and against the executor of the will of their mother. The plaintiff 
 seeks to establish an agreement of compromise between her ■ brother 
 and herself as to the will and property of their mother, and to have the 
 executor directed to pay to her one-third of the residue when his ac- 
 counts are settled in the probate court and the time for distribution 
 shall have come. 
 
 The mother died at 1 :30 a. m. on Friday, July 28, 1905, at the City 
 Hospital. There had been an estrangement between the plaintiff and* 
 her mother for some 10 years. The brother lived in New York. He 
 reached Boston in the afternoon of the day of his mother's death, and, 
 went directly to the house of the plaintiff in Everett. The judge found 
 that on the morning of the 29th the defendant Dillaway told the plain- 
 tiff 'there was a will leaving him everything and her nothing. This was 
 
 *6 See, also, Lougrldge v. Dorville, 5 B. & Aid. 117 (1821) ; Cooli et al. v. 
 Wright, 1 Best & S. 559 (1861) ; Attorney General y. Supreme Council, Ameri- 
 can Legion of Honor, 206 Mass. 193, 92 N. E. 151 (1910). If the claim was ill- 
 founded as a matter of positive law, and no question as to the validity of the- 
 claim was raised, ;Corbearance, is insufficient. First Nat. Bank of Plattsmouth 
 V. Lehnhoff's Estate, 77 Neb. 303, 109 N. W. 164 (1906). If the claim was void 
 because based upon an illegal consideration (as distinguished from insuffi- 
 cient), a forbearance to press the claim by suit is not a valid consideration 
 for a new promise. Union Collection Co. v. Buckman, 150 Cal. 159, 88 Pac. 
 708, 9 L., R. A. (N. S.) 568, 119 Am. St. Rep, 164, 11 Ann. Cas. 609 (1907) . 
 
 *(i Fart of the opinion is omitted. 
 
'Sec. 3) FORBEARANCE AS CONSIDERATION 281 
 
 the only knowledge she had of the contents of the will. They made 
 the agreement of compromise on the evening of that day. By this 
 agreement the plaintiff promised not to contest the will and the defend- 
 ant promised that he would share with her, she taking one part and he 
 two parts of the estate. 
 
 The mother was buried on Sunday. After the funeral the brother 
 told his sister that he would not keep this agreement. The will was 
 admitted to probate on September 27th, without opposition, and this 
 bill was filed on November 14th. 
 
 The cause was heard on the merits, the evidence being taken by a 
 -commissioner. The judge made findings of the material facts and or- 
 dered a decree to be entered for the plaintiff. In pursuance of that 
 order a decree was entered declaring that by virtue of the agreement of 
 compromise the plaintiff was entitled to one-third of all moneys com- 
 ing to the defendant in addition to one-third of the legacy of $5 be- 
 queathed to her, and directing the defendant Wheeler as executor to 
 make said payrnents after the settlement of his final account in the 
 probate court. It was further provided in said decree that the plain- 
 tiff should have the same standing in the probate proceedings that she 
 would have had if the plaintiff and defendant had been residuary 
 legatees. 
 
 The case is now before us on appeal by both defendants. 
 
 1. The first contention of the appellants is that the offer of the de- 
 fendant was by its terms to ripen into a contract of compromise on 
 the plaintiff's not contesting the probate of the will, that it was with- 
 drawn before the time for such an acceptance came, and therefore no 
 contract ever came into existence. But the plaintiff testified that when 
 the defendant made the offer to her she told him that she would not 
 contest the will. The judge in terms found that to be true. He found 
 that "the plaintiff in good faith stated to the defendant, her brother, 
 that she would contest the will on the ground of undue influence and 
 want of sanity, and in consideration of his agreement to share the es- 
 tate with her promised not to mike any contest." After a careful ex- 
 amination of the whole evidence we see no reason to overturn that 
 finding. 
 
 2. The second contention is that on the evidence th&re v^as as mat- 
 ter of law no valid consideration because it was not proved that the 
 plaintiff had a fair chance of success in contesting the will. Their ar- 
 gument in support of this contention is that forbearance to prosecute 
 an invalid claim is not a valid consideration for a promise unless "the 
 promisee as a reasonable person believed that she had some fair chance 
 of already succeeding in the contest." As we have already said, the 
 judge found that the plaintiff "acted in good faith" in stating that she 
 would contest the will and in agreeing' not to contest it in consideration 
 of his agreement to share with her. The judge further ruled "that she 
 is not required to go further and prove that there was a doubtful ques- 
 
282 CONSIDERATION (Ch. 2 
 
 tion as to sanity or undue influence in order to establish a valid con- 
 sideration. She had the right, acting in good faith, to go to court and 
 make a contest and she promised not to exercise that right, and did not 
 exercise it." 
 
 There are decisions in other jurisdictions for the position taken by 
 the appellants. A collection of the decisions to that effect may be 
 found in Wald's Pollock on Contracts (3d Am. Ed.) 214, note 23. But 
 since the decision of this court in Prout v. Pittsfield Fire District, 154 
 Mass. 450, 28 N. E. 679, those cases are not law in this commonwealth, 
 and the earlier case of Palfrey v. Portland, Saco & Portsmouth Ry. 
 Co., 4 Allen, 55, must be taken to be modified accordingly. This court 
 in Prout v. Pittsfield Fire District adopted the rule finally established 
 in England in Miles v. New Zealand Alford Estate Co., 32 Ch. D. 2^6, 
 in which Cook v. Wright, 1 B. & S. 559, Callisher v. Bischoffsheim, L. 
 R. 5 Q. B. 449, Ockford v. Barelli, 20 W. R. 116, and the doubts 
 thrown on those decisions by Lord Esher, M. R., in Ex parte Banner, 
 17 Ch. D. 480, 490, were considered at length. The rule there laid 
 down was stated on page 291 with accuracy by Lord Bowen to be: 
 "If an intending litigant bona fide forbears a right to litigate, he does 
 give up something of value." He added, speaking of the case then be- 
 fore him : "I think therefore that the reality of the claim which is giv- 
 en up must be measured, not by the state of the law as it is ultimately 
 discovered to be, but by the state of the knowledge of the person who 
 at the time has to judge and make the concession." Again, on page 
 292, Lord Bowen says : "When the Master of the Rolls in Ex parte 
 Banner, 17 Ch. D. 480, says he doubts, if there was really and obvious- 
 ly no cause of action, whether the belief of the parties that there was, 
 would be sufficient ground for a compromise, I agree if by that he 
 means there must be a real cause of action, that is to say, one that is 
 bona fide and not frivolous or vexatious ; but I do not agree if he 
 means by a real cause of action some cause of action which commends 
 itself to the ultimate reasoning of the tribunal which has to consider 
 and determine the case." The case of Prout v. Pittsfield Fire District, 
 154 Mass. 450, 453, 28 N. E. 679, was affirmed in Kennedy v. Welch, 
 196 Mass. 592,-83 N. E. 11. 
 
 In the case at bar, having regard to the knowledge of the plaintiff, 
 can it be said that her claim was a vexatious or frivolous one ? Unless 
 a duly executed will had been made she was entitled as one of the two 
 next of kin to a half of her mother's estate. She had just been told 
 by the other next of kin, her brother, that their mother had left a will 
 by which everything had been bequeathed to him. Even although she 
 had been estranged from her mother for ten years, a determination to 
 examine the will and the circumstances under which it had been made 
 could not be said (having regard to the knowledge of the plaintiff) to 
 be either vexatious or frivolous. > We are of opinion that this finding 
 and this ruling were right. The claim in Palfrey v. Portland, Saco & 
 
Sec. 3) FORBEARANCE AS CONSIDERATION 283 
 
 Portsmouth Ry. Co., 4 Allen, 55, was a frivolous and vexatious 
 one. * * * 
 
 Decree affirmed.*^ t 
 
 MIT.es v. new ZEALAND ALFORD ESTATE CO. - 
 (In the Court of Appeal, 1886. L. R. 32 Oh. Div. 266.) 
 
 The New Zealand Alford Estate Company, Limited, was incorporate 
 ed under the Companies Acts of 1862 and 1867, with articles of as- 
 sociation, the material clauses of which were as follows : 
 
 "8. The company shall not be bound to recognize any contingent, fu- 
 ture, partial, or equitable interest, in the nature of a trust or otherwise, 
 in an)' share, or any other right in respect of any share, except an ab- 
 solute right thereto in the person from time to time registered as the 
 holder thereof. * * * " 
 
 "23. No shares shall be transferred to a stranger so long as the com- 
 pany or any member is willing to purchase the same at a fair value." 
 
 "28. The company may decline to register any transfer of shares 
 upon which the company has a lien by virtue of clause 43 hereof." 
 
 *7 In accord: Burleson v. Mays, 189 Ala. 107, 66 South. 36 (1914) ; Silver 
 V. Graves, 210 Mass. 26, 95 N, B. 948 (1911); Layer v. Layer, 184 Mich. 663, 
 151 N. W. 759 (1915); Heath v. Potlatch Lumber Co., 18 Idaho, 42, 108 Pac. 
 343, 27 L. R. A. (N. S.) 707 (1910), the claim being made iti good faith; Latu- 
 lippe V. New England Invi Co., 77 N. H. 31, 86 Atl. 361 (1918). 
 
 A compromise contract is not invalidated by the fact that the claim was 
 unfounded, if it was believed in by the party Inaking the claim. It is hard to 
 be convinced of good faith if there was no reasonable ground for belief. Such 
 contracts are nearly always sustained. See Bank of Commerce v. Scofleld, 
 126 Cal. 156, 58 Pac. 451 (1899) ; Lewis v. Gove County Tel. Co., 95 Kan. 136, 
 147 Pac. 1122, Ann. Cas. 1916B, 1035 (1915) ; Western & Southern Life Ins. 
 Co. V. Quinn, 130 Ky. 397, 113 S. W. 456 (1908); Alexander v. Maryland Trust 
 Co., 106 Md. 170, 66 Atl. 836 (1907) ; Wood v. Kansas City Home Tel. Co., 223 
 Mo. S37, 123 S. W. 6 (1909) ; Armijo v. Henry, 14 N. M. 181, 89 Pac. 305, 25 
 L. R. A. (N. S.) 275, and note (1907) ; Post v. Thomas, 212 N. Y. 264, 106 N. 
 E. 69 (1914) ; Id., 212 N. Y. 585, 106 N. E. 1042 (1914) ; Kelly v. Burnham, 
 Williams & Co., 248 Pa. 223, 93 Atl. 949 (1915) ; Roane v. Union Pac. Life Ins. 
 Co.,. 67 Or. 26i, 135 Pac. 892 (1913) ; Bowers Hydraulic Dredging Co. v. Hess, 
 71 N. J. Law, 327, 60 Atl. 362 (1905) ; Smith v. Monteith, 13 M. & W. 427 
 (1844), discharge of one from arrest; Oallisher v. BischofCsheim, L. R. 5 Q. 
 B. 449 (1870) ; Crawford v. Engram, 157 Ala. 314, 47 South. 712 (1908), for- 
 bearance is no consideration, if no suit has been brought and there is no rea- 
 sonable ground to contest. 
 
 "It is settled in this commonwealth that forbearance to sue constitutes or 
 may be found to constitute a good consideration for a promise to an intending 
 litigant, and that it is not necessary In a suit on such promise that it should 
 appear that there was in fact a good cause of action, or a fair and reasonable 
 ground of success in the threatened suit. * * * In order that forbearance 
 to sue should constitute a valid consideration for the defendant's promise 
 there must have been a bona fide intention on the part of the plaintiff to con- 
 test the will, * * * a threat to contest the will, merely for the purpose 
 of compelling the defendant to settle with her and buy his peace without any 
 intention on her part of actually contesting the will if no such settlement was 
 made, would not be sufficient and would not constitute a valid consideration 
 for the defendant's promise." Mackin v. Dwyer, 205 Mass. 472, 91 N. E. 893 
 (lyiO). 
 
284 CONSIDERATION (Ch. 2* 
 
 "43. The company shall have a first and paramount lien upon all the 
 shares of each member for his debts, liabilities and engagenients, solely 
 or jointly with any other person, to or with the company, whetheir the- 
 period for the payment, fulfilment, or discharge thereof shall have ac- 
 tually arrived or not." 
 
 "44. For the purpose of enforcing such lien the directors may sell 
 the shares subject thereto without any notice to or consent by the hold- 
 er of such shares, or any other person; but no salt shall be made un- 
 less and until default be made in the payrnent, fulfilment, or discharge 
 of such debts, liabilities, or engageinents." 
 
 The defendant, Samuel Grant, who was one of the prompters of the 
 company, was in May, 1882, an^ at the hearing of this action was still,- 
 the registered holder of 125 shares of £100 each in the company. In 
 May, 1882, when £40 apiece had been paid up on these shares. Grant 
 accepted and discounted two accommodation bills payable at six and 
 eighteen months after date for £5,000 each, drawn on him by the plain- 
 tiff, E. P. W. Miles, applied the proceeds to his own use, and deposited 
 the certificates of his shares with the plaintiff. 
 
 By indenture dated October 19th, 1882, the defendant Grant charg- 
 ed his 125 shares with the two sums of £5,000 and interest thereon at 
 £5 per cent, per annum, and covenanted at any time during the contin- 
 uance of the security to execute a legal transfer of the shades in favor 
 of the plaintiff; and by an agreement under seal of the same date- 
 Grant covenanted with the plaintiff to pay all calls upon the shares 
 during the continuance of the security, and it was agreed that in de- 
 fault the plaintiff might pay such calls and add the moneys so paid with 
 interest thereon to his security. 
 
 On I^ovember 4th, 1882, notice in writing of the plaintiff's interest 
 in Grant's 125 shares under the indenture of October 19th, 1882, was 
 served upon the company, and this notice was acknowledged by the 
 company on November 6th, and was entered in the share register. 
 
 When the bills came to maturity Grant made default in payment, 
 and the plaintiff paid them. 
 
 A call of £20 per share was made by the company on Decernber 12th, 
 1882. Grant made default in payment, and this and the subsequent 
 calls made by the company were paid by. the plaintiff in order to avoid 
 a forfeiture of the shares. 
 
 Grant, besjdes being a promoter of the company and the holder of 
 the above-mentioned shares, was the vendor to the company of the 
 property in New Zealand known as the Alford Estate, the acquisition 
 and working of which was the substantial object of the formation of 
 the company. He was also the chairman of the board of directors, 
 and at a general meeting of the company held on March 15th, 1883, an 
 angry discussion took place, at the close of which he gave to the com- 
 pany a written guarantee or warranty signed by himself in the follow- 
 ing terms : 
 
Sec. 3) FORBEARANCE AS CONSIDERATION 28") 
 
 "Gentlemen : I hereby guarantee that a dividend (duly earned dur- 
 ing the year) of not less than £Z per centum per annum be paid to the 
 shareholders for the year ending June 30th, 1883, and afterward that 
 there shall be paid to them a yearly dividend of not less than £5 per 
 centum per annum (duly earned during the year) for a period of ninety 
 years, and I undertake within three calendar months after the end of 
 any and every year to pay to you any sum requisite to pay the agreed 
 minimum dividend if the company has not earned it." 
 
 No resolution was passed at the general meeting with reference to 
 the giving of the guarantee. 
 
 Grant was adjudicated a bankrupt on February 19th, 1884. In May, 
 
 1884, there being due to the plaintiff upon the security of the indenture 
 
 ' and memorandum of agreement of October 19th, 1882, the sum of 
 
 i7,885, he applied to the company to do and concur in all acts necessary 
 
 for effecting a sale and transfer of the 125 shares. 
 
 The company, however, claimed a lien on the shares under the guar- 
 antee given to them by grant in their articles of association in 
 priority to the plaintiff's charge; and they refused to permit any 
 sale or transfer of the shares until their claim was satisfied. The 
 plaintiff then brought this action against the company and Grant and 
 his truslfee in bankruptcy, and claimed a declaration that under the 
 deed of October 19th, 1882, he was entitled to a first charge on the 
 125 shares for the principal and interest secured thereby, and for all 
 sums paid by him for calls, and to have this charge enforced by fore- 
 closure or otherwise, and he pleaded that the guarantee given by 
 Grant was not under seal, that no consideration had been given for 
 it, and that even if consideration had been Sfiven, the document 
 did not comply with the requirements of the Statute of Frauds. To 
 this the company rejoined that the guarantee "was executed as part of 
 a contract whereby the company and the shareholders for whose bene- 
 fit it was executed, in consideration of the execution by the defendant 
 S. Grant of the said documents, agreed to put an end to certain con- 
 templated proceedings against the defendant S. Grant and to give up 
 certain: claims against him, and that they did in pursuance of such 
 contract abandon such proceedings and give up such claims and 
 accept the guarantee in full accord and satisfaction of the right 
 of action founded on such claims ;'' and they pleaded also that the 
 said contract was one to be performed, and that it was in fact per- 
 formed, within one year from the making thereof. 
 
 There was evidence that Grant had misrepresented the Alford Es- 
 tate, that the defendant company had made claims against Grant and 
 had threatened proceedings, that at a shareholders' meeting Grant had 
 made several offers of compromise and finally offered to sign the guar- 
 anty previously set out in consideration of the defendant company and 
 the said shareholders -agreeing to abandon their claims against him, 
 and that the company did in fact forbear to bring action and did give 
 up all claims. 
 
286 CONSIDERATION (Ch 2 
 
 The action came on for trial before North, J., upon motion for judg- 
 ment in default of pleading against the defendant Grant and his trustee 
 in bankruptcy, and was heard on June 22d, 23d, and 24th, 1885.*^ 
 
 Cotton, X. J. This is an appeal of the defendant company from a 
 judgment of North, J., in an action brought by the plaintiff in order to 
 enforce his right under an fcquitable mortgage on shares in the com- 
 pany, and two questions are raised for -the decision of the Court. 
 F'irst, whether the company, supposing them to have a legal claim 
 against Grant, the holder of the shares, are entitled under their articles 
 of association to priority for that claim as against the claim of the 
 plaintiff; and, secondly, whether they had in fact any legal claim 
 against Grant. Mr. Justice North held that, in fact, they had a good 
 claim, but he held on the authority of Bradford Banking Company v. 
 Briggs & Co. [29 Ch. D. 149], as decided in the Court below, that the 
 company were not entitled in priority to the plaintiff. * * * *' 
 
 But then comes the question, had the company in fact any legal claim 
 as against Grant? Theii- claim was under a letter signed by Grant, 
 which guarantees or undertakes that a certain yearly dividend shall be 
 paid to the shareholders during a long period of years, and it is objected 
 that ho consideration appears upon the face of the letter, alid that no 
 consideration was in fact given to Grant for that promise (I call it 
 "promise," because to call it "contract" would be to assume there was 
 consideration) given by the shareholders. 
 
 Now there was much argument upon the question, what is a good 
 consideration for a compromise ; and there are authorities which for a 
 considerable time were considered' as laying down the law upon the 
 subject ; but Lord Esher, the present Master of the Rolls, in Ex parte 
 Banner [17 Ch; D. 480), is supposed to haVe thrown doubts on these 
 authorities ; and what he said was in fact that if the question ever 
 came before this Court the authority of Callisher v. Bischoffsheim [L. 
 R. 5 Q. B. 449], Ockford v. Barelli [20 W. R. 116], and Cook v. 
 Wright [1 B. & S. 559] would have to be considered. 
 
 Now, what I understand to be the law is this, that if there is in fact 
 a serious claim honestly made, the abandonment of the claim is a good 
 "consideration" for a contract ; and if that is the law, what we really 
 have to now consider is whether in the present case there is any evi- 
 dence on which the Court ought to find that there was a serious claim 
 in fact m~ade, and whether a contract to abandon that claim was the 
 consideration for this letter of guarantee. I am not going into the 
 question at present as to how far the Statute of Frauds will raise any 
 difficulty in the way. And I think also that the mere fact of an action 
 being brought is not material except as evidence that the claim was 
 
 • *s statement of facts is condensed. Opinion of North,- J., and part of opin- 
 ions of Cotton and Bowen, L. JJ., are omitted. 
 
 4 8 The court lield tliat Justice Nortli!s decision on this point was wrong, the 
 Bradford Case having been later reversed. North's opinion will be found in 
 82 Ch. B. 273. 
 
Sec. 3) FORBEAKANCE AS CONSIDBRATJON 287 
 
 in fact made. That, I think, was laid down by Lord Blackburn in 
 Cook V. Wright, and also in Callisher v. Bischoffsheim, and, subject to 
 the question whether these cases are overruled, or ought to be consid- 
 ered as unsound, that, I think, is a correct statement of the law. Now, 
 by "honest claim," I think is meant this, that a claim is honest if the 
 claimant does not know that his claim is unsubstantial, or if he does 
 not know facts, to his knowledge unknown to the other party, which 
 show that his claim is a bad one. Of course, if both parties know all 
 the facts, and with knowledge of those facts obtain a compromise, it 
 cannot be said that that is dishonest. That, is, I think, the correct law, 
 and it is in accordance with what is laid down in Cook v. Wright and 
 Callisher v. Bischoffsheim and Ockford v. Barelli. What was stated in 
 Cook V. Wright by Lord Blackburn is this : "We agree that unless 
 there was a reasonable claim on the one side, which it was bona fide 
 intended to pursue, there would be no ground for a compromise ; but 
 we cannot agree that (except as a test of the reality of the claim in 
 fact) the issuing of a writ is essential to the validity of the compro- 
 mise." Again, what his Lordship says in the subsequent case of Cal- 
 lisher V. Bischoffsheim is this: "If we are to infer that the plaintiff 
 believed that some money was due to him, his claim was honest, and 
 the compromise of that claim would be binding and would form a good 
 consideration, although the plaintiff, if he had prosecuted his original 
 claim, would have been defeated." The doubt of the Master of the Rolls 
 seems to have been whether a compromise would not be bad, or a prom- 
 ise to abandon a claim would be a good consideration if, on the facts 
 being elicited and brought out, and on the decision of the Court being 
 obtained, it was found that the claim which was considered the con- 
 sideration for the compromise was a' bad one. But if the validity of 
 a compromise is to depend upon whether the claim was a good one or 
 not, no compromise would be effectual, because if it was afterward dis- 
 puted, it would be necessary to go into the question whether the claim 
 was in fact a good one or not; and I consider, notwithstanding the 
 doubt expressed by the Master of the Rolls, that the doctrine laid 
 down in Cook v. Wright and Callisher v. Bischoffsheim and Ockford 
 V. Barelli is the law of this Court. 
 
 Now was there here any claim in fact made on behalf of the com- 
 pany against Grant, and was there, in fact, anything which would bind 
 the company to abandon that claim ? The conclusion at which I have 
 arrived is, that there is no evidence on which we ought to rely that 
 there was in fact a claim intended to be made against Grant, and, in 
 my opinion, on the evidence before us, we ought not to arrive at the 
 conclusion that there was ever intended to be any contract by the com- 
 pany, much less that there was in fact any contract binding the com- 
 pany that that claim should not be prosecuted, and should be given 
 up. [His Lordship alluded shortly to the facts of the case, and con- 
 tinued.] Now, undoubtedly, on the evidence, several of the share- 
 holders present at the general meeting of March 15th, 18§3, expresseid 
 
288 CONSIDERATION (Ch. 2 
 
 a very hostile feeling against Mr. Grant, who had sold the property to 
 the company ; that is admitted by him, and is in my opinion clear. 
 But then what was done? There is nothing at all on the face of this 
 letter of guarantee, as I have already stated, which says that it was 
 given by Grant in consequence of the company giving up any claim 
 they might have against him, and there is nothing whatever in the min- 
 utes of the board which states in fact that this was so, nor is there 
 anything after that time in the minutes of the boaird of directors which 
 can be referred to as showing an agreement by them to give up any 
 claim they otherwise intended to prosecute against him. What I should 
 say was the state of the case is this — there was angry feeling, and 
 Mr. Grant thought it might result in proceedings being taken against 
 him; and, therefore, what he considered the wisest course was to 
 make this offer in the hope and expectation that he would keep things 
 quiet, and let things go on peaceably. 
 
 Now, in my opinion, a simple expectation, even though ■■ realized, 
 would not be a good consideration for the promise which he gave. In 
 order to make a good consideration for the promise there must be 
 something binding done at the, time by the other party, there must be 
 something moving from the other party toward the person giving the 
 promise. In my opinion, to make a good consideration for this con- 
 tract, it must be shown that there was something which would bind the 
 company not to institute proceedings, and shown also that in fact pro- 
 ceedings were intended on behalf of the company ; and, in my opinion, 
 I cannot come to the conclusion as a matter of fact that these two 
 things existed. It is true that directors were present at the meeting, 
 and that their guarantee was entered on the minutes,, but although this 
 was the case, it cannot in my opiriion be considered that the directors by 
 being there entered into any contract as directors not to enforce the 
 claim of the company. The proper mode of proving any agreement 
 made by the directors would be the production of evidence of its hav- 
 ing been made at a meeting held by them as the persons having 'the 
 condlict of the business of the society. No doubt, they might, if they 
 had been so minded, at a meeting of the board agree that they should 
 not make any claim against him in consideration of this having taken 
 place, but I find nothing of that kind. 
 
 Again, this is an incorporated company, and even if any statement 
 had been made at this meeting that no proceedings should be taken, yet 
 to bind the company there ought to be something done by way of a 
 resolution, and mere statements by individual members that they were 
 satisfied with this guarantee would not in any way bind the company 
 so as to prevent them from taking proceedings if they ever intended to 
 do so. In my opinion this promise was given in the expectation that 
 this would be a sop to the angry shareholders, and that no proceedings 
 would be taken. The mere fact that none have been taken, will not in 
 my opinion make that a consideration, unless (putting aside the ques- 
 tion as to the company being bound) something was, done or said in 
 
Sec. 3) FORBEARANCE AS CONSIDERATION 289 
 
 such a way as to be the action or saying of the company, that if this 
 guarantee was given.no proceedings would be taken. Of course if this 
 company were an individual, and the individual ma^ a representation 
 that if this guarantee was given he would talte no proceedings, that 
 would be a contract binding him, but in my opinion if a company is to 
 be bound, it ought to be bound by some more formal proceedings, ei- 
 ther by the action of the directors sitting as such, or by something 
 equivalent to a resolution of the shareholders in general meeting. 
 
 Mr. Justice North, although he decided in favor of the plaintiff, has 
 held that there was sufficient consideration for the guarantee ; snd if he 
 had come to the conclusion that there was upon the evidence before 
 him that which amounted to a contract binding the company, then I 
 should undoubtedly feel some difficulty, because he had a better oppor- 
 tunity of judging of the evidence than we can have. But, on reading 
 his judgment, I come to the conclusion that he rather considered there 
 was an expectation than that this would be the result, and that if that 
 expectation was performed and completed, this would be enough to 
 give a cohsideration. * * * 
 
 I come accordingly to the conclusion that there is, in fact, no consid- 
 eration to support the guarantee on which the company rely, and to 
 make it a contract binding on Mr. Grant ; and as I have come to the 
 conclusion that there was not sufficient consideration to support the 
 promise, it is not necessary for me to enter into the question as to the 
 Statute of Frauds. 
 
 BowEN, L. J. * * * Therefore we have to determine whether 
 or no there was any consideration for this guarantee, and it is upon 
 that point that I am, with great regret, obliged to state that my opin- 
 ion is at variance with the view at which Lord Justice Cotton has 
 arrived. The inquiry whether there was or was not consideration for 
 this guarantee renders it necessary to say some words upon the law, and 
 then to apply the law to the question of fact. 
 
 Speaking broadly, what has to be determined is, in my opinion, 
 whether there was at a critical moment any forbearance to press a real 
 claim on the part of the company, or of the directors of the company, 
 who had ample powers under their articles of association to act for the 
 company, and, if so,, whether such forbearance was brought about by 
 the express or implied request of Mr. Grant, and in consideration of his 
 guarantee. A valuable consideration may, of course either consist of 
 some right, inter.esty profit, or i benefit which accrues to one party, or 
 some forbearance, or detriment, or loss, or responsibility, which is 
 given to or undertaken by the other. We have to see here in the first 
 place whether there was forbearance promised, in which case the prom- 
 ise would be the consideration for the guarantee, or whether there was 
 an actual forbearance given at the request of the guarantor and in re- 
 turn for something. The two views run very close together. : If the di- 
 rectors, in consideration of this guarantee, made an actual agreement to 
 
 COBBIN CONT. 19 
 
290 CONSIDERATION (Ch. 2 
 
 forbear, they really took the agreement in accord and satisfaction of any 
 claims, if there were claims, and beyond that agreed not to prosecute 
 the question whelji^er there were any; but such an agreement as that 
 need not be in writing. It seems to me there is no magic at all in for- 
 malities, and that there would be ample evidence of such an agreement, 
 if this guarantee to the knowledge of both parties was given and ac- 
 cepted upon the understanding that no proceedings should be insti- 
 tuted. But I do not accept the proposition that this guarantee cannot 
 be effectual and supported by consideration unless there is at the mo- 
 ment it was given something to bind the company. If the guarantee 
 were given on the condition and on the contingency that there should 
 be forbearance, and was taken upon that condition, and upon that 
 contingency and the contingency afterwards happened, then the for- 
 bearance when given, being at the request expressed or impHed of the 
 guarantor, would furnish an implied consideration for the guarantee 
 which had already been given. That is, I think, no new law. In Ol- 
 dershaw v. King, 2 H. & N. 399, 517, 520, there was a guarantee giv- 
 en to the following effect: "I am aware," said the guarantor, "that 
 my uncles Messrs. J. & J. F. King, stand considerably indebted to you 
 for professional busirtess, and for cash lent and advanced to them, and 
 that it is not in their power to pay you at present, and as in all proba- 
 bility they will become further indebted to you, though I by no means 
 intend that this letter shall create or imply any obligation on your part 
 to increase your claim against them, I am willing to bear you harmless 
 against any loss arising out of the past and future transactions between 
 you and my said uncles to a certain extent, and therefore in considera- 
 tion of your forbearing to press them for the immediate payment of 
 the debt now due to you, I hereby engage and agree to guarantee you 
 the payment of any sum they may be indebted to you upon the balance 
 of accounts between you at any time during the next six years, to the 
 extent of £1,000, whenever called upon by you to pay the same, and 
 after twelve calendar months' previous notice." In that case, Erie, J., 
 expressed himself in the following language: "Looking at the whole 
 letter, and the circumstances under which it was written, and consider- 
 ing the importance of further advances, I come to the conclusion, that 
 the consideration contemplated was, that further advance should be 
 made, and time given by the creditor before he would press for the 
 payment of the existing debt. Though the contract did not bind the 
 creditor to make further advances, or to give time unless he chose to 
 do so, it is clear that if he did make the advances and did give time, 
 that which was contingent at the time when the instrument was writ- 
 ten became an absolute and binding contract." The same principle 
 was applied in the case of the Alliance Bank v. Broom, 2 Dr. & Sm. 
 289. "It appears to me," said the Vice-Chancellor, 2 Dr. & Sm. 292, 
 "that when the plaintiffs demanded payment of their debt, and, in con- 
 sequence of that application, the defendant agreed to give certain se- 
 curity, although there was no promise on the part of the plaintiffs to 
 
Sec. 3) FORBEARANCE AS CONSIDERATION 291 
 
 abstain for any certain time from suing for the debt, the effect was, 
 that the plaintiffs did, in effect, give, and the defendant received, the 
 benefit of some degree of forbearance; not, indeed, for any definite 
 time, but, at all events, some extent of forbearance." So it will be 
 sufficient here that the directors did forbear, if their forbearance was 
 at the request expressed or implied of the guarantor and in conse- 
 quence of his guarantee being given, and it seems to me there is no 
 sort of necessity to discover language of any particular form, or writ- 
 ing of any particular character, embodyingf the resolution of the di- 
 rectors. We must treat the thing in a busmess way and draw an in- 
 ference of fact as to what the real nature of the transaction was as 
 between business men. But an attempt was made to shew that the 
 forbearance was worth nothing. Of course forbearance of a non-exist- 
 ing claim would not be forbearance at all. We were referred to the 
 language of the Master of the Rolls in the case of Ex parte Banner, 17 
 Ch. D. 480, which seems to throw doubt upon the doctrine which has 
 more than once been laid down in the Courts of Common Law, and 
 finally in the well-known case of Callisher v. Bischoffsheim, Law Rep. 
 5 Q. B. 449. It seems to me that if an intending litigant bona fide for- 
 bears a right to litigate a question of law or f apt which^ it is" not vex- 
 atious or frivolous to litigate, he does give up something of value. It 
 is a mistake to suppose it is not an advantage, which a suitor is ca- 
 pable of appreciating, to be able to litigate his claim, even if he turns 
 out to be wrong. It seems to me it is equally a mistake to suppose 
 that it is not sometimes a disadvantage to a man to have to defend an 
 action even if in the end he succeeds in his defence; and I think 
 therefore that the reality of the claim which is given up must be meas- 
 ured, not by the state of the law as it is ultimately discovered to be, but 
 by the state of the knowledge of the person who at the time has to 
 judge and make the concession. Otherwise you would have to try the 
 whole cause to know if the man had a right to compromise it, and with 
 regard to questions of law it is obvious you could never safely com- 
 promise a question of law at all. With regard to the observations of 
 the Master, of the Rolls in Ex parte Banner I should like to point out 
 in respect to Callisher v. Bischoffsheim in the first place that whatever 
 be the objection taken to the language of the Court in that case, in any 
 point of view the case was rightly decided. The plea there only denied 
 the existence of the debt, and left it oh the record undisputed that the 
 debt might have been put forward reasonably as a substantial claim. 
 But with regard to the language of the Court in Callisher v. Bischoff- 
 sheim, Law Rep. 5 Q. B. 449, I confess it seems to me that the lan- 
 guage of Lord Blackburn was correct, that the decision in Ockford v. 
 Barelli, 20 W. R. 116, was right, and that the language in Cook v. 
 Wright, 1 B. & S. 559, is equally unimpeachable. When the Master of 
 the Rolls in Ex parte Banner, 17 Ch. D. 480, says he doubts, if there 
 was really and obviously no cause of action, whether the belief of the 
 parties that there was, would be sufficient -ground for a compromise, I 
 
292 CONSIDERATION (Cll. 2 
 
 agree if by that he means there must be a real cause of action, that is 
 to say, one that is bona fide and not frivolous or vexatioys; but I do 
 not agree if he means by a real cause of action some cause of action 
 which commends itself to the ultimate reasoning of the tribunal which 
 has to consider and determine the case. * *- * 
 
 [The Lord Justice then reviewed the evidence, and arrived at the 
 conclusion "that proceedings had been threatened, that Mr. Grant knew 
 that they had been threatened, tliat he gave the guarantee in order to 
 put an end to them, and that the proceedings were dropped in conse- 
 quence of his giving that undertaking." He said that he was differing 
 from Cotton, L. J., only upon a question of fact, but that he was 
 oWiged to dissent. 
 
 [The opinion of Fry, L. J., is here omitted. He agreed, with Cot- 
 ton, L,. ]., in result, his reasons being that the company had no bona 
 fide claim against Grant, and that if such a claim existed they had nev- 
 er agreed to extinguish it. 
 
 [The result was that the majority of the court, while differing with 
 Mr. Justice North on both points decided by him, affirmed the decree 
 and dismissed the appeal. The claim of Miles to a charge on Grant's 
 shares was sustained.] 
 
 SECTION 4.— MUTUAL PROklSES AS CONSIDERATION 
 FOR EACH OTHER 
 
 (Conditional and Illusory Promises — Mutuality of Legal Duty or 
 
 Obligation) 
 
 STRANGBOROUGH AND WARNER'S CASE. 
 
 (In the King's Bench, 1589. 4 Leon. 3.) 
 
 Note, that a promise against a promise will maintain an action upon 
 the case, as in consideration that you do give to me £10 on such a day, 
 I promise to give you £10 such a day after.^" 
 
 50 In Thorpe v. Thorpe, 12 Mod. 455 (1701), Holt, O. J., said: "A Is pos- 
 sessed of Black Acre, to which B has no manner of right, and A desires B to 
 release him all his right to Black Acre, and promises laim, in consideration 
 thereof, to pay so much money, surely this is a good consideration and a good 
 promise, for it puts B to the trouble of making a release. Then where the 
 doing a thing will be a good consideration, a promise to do that thing will be 
 so too." See, also, 2 Street, Foundations of Legal Liability, 110 (1906); Wil- 
 listoh, Consideration in Bilateral Contracts, 27 Harv. L. Rev. 518 (1914). 
 
 "So far as regards the matter of the cohsidsration, 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 
 
Sec. 4) MUTUAL PROMISES AS CONSIDERATION 293 
 
 COOK V. SONGAT. 
 (In the King's Bencb, 1588. 1 Leon. 103, 4 Leon. 31.) 
 
 In an action upon the case by Cook against .Songat, the plaintiff de- 
 clared, quod cum qusedam lis and controversie had been moved betwixt 
 the plaintiff lord of the manor, &c. and the defendant claiming certain 
 lands parcel of the said manor, to hold it by copy ; and whereas both 
 parties submitted themselves to the judgment and arbitrament of J. S. 
 counsellor at law, concerning the said land, and the title of the defend- 
 ant to it : the defendant in consideration that the plaintiff promised to 
 the defendant, that if the said J. S. should adjudge the said copy to be 
 good and sufficient for the title of the defendant, that then he would 
 suffer the defendant to enjoy the said land accordingly without molesta- 
 tion : the defendant reciprocally promised the plaintiff, that if the said 
 J. S. should adjudge the said copy not sufficient to maintain the title of 
 the defendant, that then he would deliver and surrender the possession 
 of the said land to the plaintiff without any suit ; and shewed further, 
 that J. S. had. awarded the said copy utterly insufficient, &c. yet the de- 
 fendant did continue the possession of the land, &c. And by Godfrey, 
 here is not any consideration: but by Gawdy, the same is a good and 
 sufficient consideration, because it is to avoid variances and suits : and 
 judgment was given for the plaintiff. 
 
 HOLT V. WARD CLARENCIEUX. 
 
 (In the King's Bench, 1732. 2 Strange, 937.) 
 
 The plaintiff declared, that it was mutually agreed between the 
 plaintiff and defendant that they should marry at a future day, which 
 is past, and that in consideration of each other's promises, each engag- 
 ed, to the other ; notwithstanding which the defendant did not marry 
 the plaintiff, but had married another, which she lays to her damage 
 of £4,000. 
 
 The defendant with leave of the Court pleaded double (viz.) non as- 
 sumpsit, and that the plaintiff at the tiipe of the promise was an in- 
 fant of fifteen years of age. 
 
 The plaintiff joins issue on the non assumpsit, and a verdict is found 
 for her, with i2,000 damages. And as to, the plea of infancy demur- 
 red. 
 
 particular matter to form a consideration." Leake, Contracts (1st Ed.) p. 
 314; Id. (2d Ed.) pp. 612, 613. 
 
 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 Liability; Holdsworth in 11 Mich. L. Kev. 347; Oorbin, "Does a 
 Pre-existing Duty Defeat Consideration?" (1918) 27 Yale L. Jour. 362, 374. 
 
 For further discussions see Ames, "Two Theories of Consideration," 12 
 Harv. L. Bev. 515; Williston, "Successive Promises of the Same Perform- 
 ance," 8 Harv. L. Rev. 27; Langdell, "Mutual Promises as a Consideration," 
 14 Harv. L. Rev. 496. 
 
294 CONSIDERATION (Ch, 2 
 
 This cause was several times argued at the Bar: 1. By Mr, Strange 
 for the plaintiff, and Serjeant Cliapple for the defendant. When the 
 Court inclined strongly with the plaintifif, because though the defend- 
 ant would not have the same remedy against her by action for dam- 
 ages, yet they thought he might have some rernedy, viz. by suit in the 
 Ecclesiastical Court, to compel a performance, the plaintiff being of 
 the age of consent : and that would be a sufficient consideration. And 
 therefore appointed an argument by civilians, to see what their law 
 would determine in such a case. 
 
 Upon the arguments of the civilians, no instance could be shewn, 
 wherein they had compelled the performance of a minor's contract. 
 And they who argued for the defendant, strongly insisted, that in the 
 case of a contract per verba de futuro, (as this was) there was no rem- 
 edy, even against a person of full age, in the Spiritual Court, but only 
 an admonition. And the only reason why they hold jurisdiction in the 
 case of a contract per verba de prsesenti is, because that is looked upon 
 amongst them to be . ipsum matrimonium, and they only decree the 
 formality of a solemnization in the face of the Church. 
 
 After their arguments it was spoke to a fourth time by Mr. Reeve 
 and Serjeant Eyre. And now this term the Chief Justice delivered 
 the resolution of the Court. 
 
 The objection in this case is, that the plaintiff not being bound equal- 
 ly with the defendant, this is nudum pactum, and the defendant can- 
 not be charged in this action. Formerly it was made a doubt by my 
 Lord Vaughan, whether any action could be maintained on mutual 
 promises to marry ; but that is now a point not to be disputed. And 
 as to the present case, we should have had no difficulty in giving judg- 
 ment for the plaintiff, if we could have been satisfied by the arguments 
 of the civilians, iha.t as the plaintiff was of the age of consent, any 
 remedy, though not by way of action for damages, could be had against 
 her. But since they seem to have had no precedent in the case, we 
 must consider it upon the foot of the common law. And upon that the 
 single question is, whether this contract as against the plaintiff, was 
 absolutely void. And we are all of opinion, that this contract is not 
 void, but only voidable at the election of the infant; and as to the 
 person. of full age it absolutely binds. 
 
 The contract of an infant is considered in law as different from the 
 contracts of all other persons. In some cases his contract shall bind 
 him ; such is the contract of an infant for necessaries, and the law al- 
 lows him to make this contract as necessary for his preservation ; and 
 therefore in such case a single bill shall bind him, though a bond with 
 a penalty shall not. 1 Lev. 87. 
 
 Where the contract may be for the benefit of the infant, or to his 
 prejudice ; the law so far protects him, as to give him an opportunity 
 to consider it when he com.es of age : and it is good or voidable at his 
 election. Cro. Car. 502; 2 Roll. 24, 427; Hob. 69; 1 Brownl. 11; 1 
 Sid. 41; 1 Vent. 21; 1 Mod. 25; Sir W. Jones, 164. But though the 
 
Sec. 4) MUTUAL PROMISES AS CONSIDERATION 295 
 
 infant has this privilege yet the party with whom he coritracts has not ; 
 he is bound in all events. And as marriage is now looked upon to be 
 an advantageous contract, and no distinction holds whether the party 
 suing be man or woman, but the true distinction is whether it nuiy be 
 for the benefit of the infant, we think, that though no express case up- 
 on a marriage contract can be cited, yet it falls within the general rea- 
 son of the law with regard to infants' contracts. And no dangerous 
 consequence can follow from this determination, because our opinion 
 protects the infant, even more than if we rule the contract to be ab- 
 solutely void. And as to persons of full age, it leaves them where the 
 law leaves them, which grants 1:hem no such protection against being 
 drawn into inconvenient contracts. 
 
 For these reasons we are all of o-pinion that the plaintiff ought to 
 have her judgment upon the demurrer. 
 
 C(fLEMAN V. EYRE. 
 (Court of Appeals of New York, 1871. 45 N. Y. 38.) 
 
 RapaIvLO, J. The plaintiff was interested to the extent of one-fourth 
 in the profits or losses of a shipment of coffee undertaken by him joint- 
 ly with other parties. After the adventure had been begun, and before 
 the coffee had reached its port of destination, it was mutually agreed 
 between the plaintiff and the defendant that the latter should have 
 one-half interest in the plaintiff's one-fourth interest in the adventure. 
 The speculation resulted in a loss, and this action was brought to re- 
 cover one-half of the plaintiff's proportion of such loss. It is now 
 claimed on the part of the defendant that no valid contract was made 
 between him and the plaintiff ; that inasmuch as the plaintiff had em- 
 barked in the speculation before and without reference to any arrange- 
 ment with the defendant, and the defendant had npt done or contribut- 
 ed any thing to aid in the joint enterprise, there was no partnership, 
 and no consideration for the undertaking of the plaintiff to give him 
 one-half of the profits ; that therefore the defendant could not have en- 
 forced payment of half the profits, if the adventure had been success- 
 ful, and consequently no agreement on his part to contribute to the 
 loss can be implied. 
 
 This argument assumes that the agreement was simply that the de- 
 fendant should have. one-half of the profits, which the plaintiff might 
 make out of the adventure, in case it should prove successful. But 
 such was not the agreement proved. The agreement was that the de- 
 fendant should share with the plaintiff in the adventure, and it seems 
 to have been clearly, understood that he should participate in the result, 
 whether it should prove a profit or a loss. That it might result in a 
 loss was contemplated by the parties. There is evidence in the case 
 that the possibility of that event was the subject 'of conversation be- 
 tween them at the time of making the contract; that the hope was 
 
296 CONSIDERATION (Ch. 2 
 
 then expressed that the plaintiff would not be compelled to call upon 
 the defendant to contribute to a loss ; and that afterwards, when they 
 did call upon him to contribute, he did not dispute his liability, but 
 sought to reduce the amount by claiming a portion of the plaintiff's 
 commissions. 
 
 The evidence fully justified a finding that in consideration of the 
 agreement by the plaintiff to account to the defendant for half the 
 profits in case of success, the defendant undertook to bear half tlie 
 loss in the contrary event ; and tlie intendment is that the referee did 
 so find. Indeed, such is a proper construction of the actual finding. It 
 is a clear case of mutual promises; and the obligation of each party 
 was a good consideration for that of the other. Briggs v. Tillotson, 8 
 Johns. 304. 
 
 The evidence was conflicting as to whether the defendant was to 
 share in the commissions. The referee found in the plaintiff's favor 
 on that point, and the court below, at general term, refused to inter- 
 fere with that finding. We cannot disturb Hk 
 
 The agreement was not within the statute of frauds. It was not an 
 agreement for the sale of any personal property or chose in action, 
 but an executory agreement, whereby one party undertook to bear one 
 part of a possible loss in consideration of a share of an expected profit. 
 
 The judgment of reversal and order granting a new trial should be 
 reversed, and the judgment for the plaintiff entered on the report of 
 the referee should be affirmed,- with costs. 
 
 All concur. 
 
 Order of general term reversed, and judgment for the plaintiff af- 
 firmed. °^ 
 
 SEWARD & SCALES v. MITCHELL. 
 (Supreme Court of Tennessee, 1860. 1 Cold. 87.) 
 
 Caruthers, J.=2 On the 16th Oct., 1856, Mitchell sold to Seward 
 and Scales, for the consideration of $8,596.50, a tract of land in the 
 county of Gibson, described in a deed of that date, by metes and 
 bounds, "containing 521 acres, being a part of a 5,000-acre tract grant- 
 ed to George Dougherty, and bounded as follows," &c. 
 
 The title is warranted with the usual covenants, but nothing more 
 saidabout the grants than what is above recited. 
 
 Some time after the deed was made, the, parties, differing as to the 
 quantity of land embraced in the tract, rtiade an agreement that it 
 should be surveyed by Gillespie, and if there were more than 521 
 
 51 An exactly similar case is Dockley v. Bury, 1 Bulst. 202 (1613). Other 
 aleatory contracts were enforced in Earl of March v. Pigot, 5 Burr. 2802 
 (1771) ; Christie v. Borelly, 29 L. J. C. P. 153 (I860) ; Martindale v. Fisher, 
 1 Wilson, 88 (1745). 
 
 5 2 Part of the opinion is omitted. 
 
Sec. 4) MUTUAL PROMISES AS CONSIDERATION 297 
 
 acres, the vendee should pay for the excess at the rate of $16.50 per 
 acre, that being the price at which the sale was made, and if less, then 
 the vendor should pay for the deficiency, at the same rate. It turned 
 out that there was an excess of 57 acres, and the tract embraced in the 
 deed was 578 acres, instead of 521, as estimated in the sale. For this 
 excess, the present suit was brought, and recovery had, for $1,- 
 079, * * * 
 
 There is more plausibility in the second objection, that there was no 
 sufficient consideration for the promise. But this is also untenable. 
 The argument is, that the deed embraced the whole tract, and passed 
 a perfect title to the extent of the boundaries, and consequently there 
 was nothing passing as a consideration for the' new promise, that the 
 party did not own before by a perfect legal right. 
 
 It is true, if the sale was by the tract and not by the acre, as appears 
 from the deed, and no stipulations as to quantity, that the title was 
 good for the whole and covered the excess. But if the sale was not 
 in gross, but by the acre and the recitation in the deed would not be 
 conclusive in a court of equity on that -point if the fact could be shown 
 to be otherwise, then there would be mutual remedies for an excess or 
 deficiency in proper cases, as we held in Miller v. Bentley, 5 Sneed, 
 671, and a more recent case; but independent of that, and taking it to 
 have been purely a sale in gross, and both parties desiring to act justly, 
 and bieing of different opinions as to the quantity, mutually agreed to 
 abide by an accurate survey to ascertain which was bound to pay, and 
 recover from the other, and what amount, we see no good reason in 
 law or morals why such an agreement should not be binding upon 
 them. The case of Howe v. O'Mally, 5 N. C. 287,. 3 Am. Dec. 693, is 
 precisely in point. The court there held that a promise to refund in 
 case of deficiency is a good consideration for a promise to pay for any 
 excess over what is called for in the deed, — ^that such mutual promises 
 are sufficient considerations for each other. 
 
 The case of Smith v. Ware, 13 Johns. (N. Y.) 259, which is supposed 
 to conflict with this, is entirely different; "there was no mutuality" 
 because the promise sued upon was to pay for the deficiency, without 
 any obligation on the other party to pay for an excess, if any there had 
 been. 
 
 The principle of the North Carolina case commends itself to our ap- 
 probation, because of its equity and justice. 
 
 Without further citation of authorities we are satisfied to hold that 
 the promise in this case was binding upon the defendant, as his Honor 
 charged, and therefore affirm the judgment. 
 
298 CONSIDEEATION (Ch. 2 
 
 GREAT NORTHERN RY. CO. v. WITHAM. 
 (In tUe Common Pleas, 1873. L. R. 9 C. P. 16.) 
 
 The cause was tried before Brett, J., at the sittings at Westminster 
 after the last term. The ^acts were as follows : In October, 1871, the 
 plaintiffs advertised for tenders for the supply of goods (amongst other 
 things iron) to be delivered at their station at Doncaster, according to 
 a certain specification. The defendant sent in a tender, as follows: 
 
 "I, the undersigned, hereby undertake to supply the Great Northern 
 Railway Company, for twelve months from November 1st, 1871, to 
 October 31st, 1872, with such quantities of each or any of the several 
 articles named in the attached specification as the company's store- 
 keeper may order from time to time, at the price set opposite each ar- 
 ticle respectively, and agree to abide by the conditions stated on the 
 other side. [Signed] Samuel Witham." 
 
 The company's officer wrote in reply, as follows : 
 "Mr. S., Witham: 
 
 "Sir: I am instructed to inform you that my directors have ac- 
 cepted your tender, dated, etc., to supply this company at Doncaster 
 station any quantity they may order during the period ending October 
 31st, 1872, of the descriptions of iron mentioned on the enclosed list, 
 at the prices specified therein. The terms of the contract must be 
 strictly adhered to. Requesting an acknowledgment of the receipt of 
 this letter, [Signed] S. Fitch, Assistant Secretary." 
 
 To this the defendant replied: 
 
 "I beg to own receipt of your favor of 20th instant, accepting my 
 tender for bars, for which T. am obliged. Your specifications shall 
 receive my best attention. S. Witham." 
 
 Several orders for iron were given by the company, which were 
 from time to time duly executed by the defendant ; but ultimately the 
 defendant refused to supply any more, whereupon this action was 
 brought. 
 
 A verdict having been found for the plaintiffs, 
 
 Digby Seymour, Q. C, moved to enter a nonsuit.^^ 
 
 Keating, J. In this case Mr. Digby Seymour moved to enter a 
 nonsuit. The circumstances were these: The Great Northern Rail- 
 way Company advertised for tenders for the supply of stores. The 
 defendant made a tender in these words : "I hereby undertake to sup- 
 ply the Great Northern Railway Company, for twelve months, from 
 etc. to etc., with such quantities of each or any of the several articles 
 named in the attached specifications as the company's store-keeper may 
 order from time to time, at the price set opposite each article respec- 
 tively," etc. Some orders were given by the company, which were du- 
 ly executed. But the order now in question was not executed ; the de- 
 
 5 3 The statement of facts is condensed. 
 
Sec..4) MUTUAL PROMISES AS CONSIDERATION 299 
 
 fendant aeeking to excuse himself from the performance of his agree- 
 ment, because it was unilateral, the company not being bound to give 
 the order. The ground upon which it was put by Mr. Seymour was, 
 that there was no consideration for the defendant's promise to supply 
 the goods ; in other words, that, inasmuch as there was no obligation on 
 the company to give an order, there was no consideration moving . 
 from the company, and therefore no obligation on the defendant to 
 supply the goods. The case mainly relied on in support of that con- 
 tention was Burton v. Great Northern Railway Co., [9 Ex. 507 ; 23 L,. 
 J. (Ex.) 184.] But that is not an authority in the defendant's favor. 
 It was the converse case. The Court there held that no action would 
 lie against the company for not giving an order. If before the order 
 was given the defendant had given notice to the company that he would 
 not perform the agreement, it might be that he would have been justi- 
 fied in so doing. But here the company had given the order, and had 
 consequently done something which amounted to a consideration for 
 the defendant's promise. I see no ground for doubting that the verdict 
 for the plaintiffs ought to stand. 
 
 Brett, J. The company advertised for tenders for the supply of 
 stores, such as they might think fit to order, for one yeaf. The de- 
 fendant made a tender offering to supply them for that period at cer- 
 tain fixed prices ; and the company accepted his tender. If there were 
 no other objection, the contract bet-ween the parties would be found in 
 the tender and the letter accepting it. This action is brought for the 
 defendant's refusal to deliver goods ordered by the company ; and the 
 objection to the plaintiffs' right to recover is, that the contract is. uni- 
 lateral. I do not, however, understand what objection that is to a 
 contract. Many contracts are obnoxious to the same complaint. If 
 I say to another, "If you will go to York, I will give you ilOO," that 
 is in a certain sense a unilateral contract. He has not promised to go 
 to York. But if he goes, it cannot be doubted tliat he will be entitled 
 to receive the £100. His going to York at my request is a sufficient 
 consideration for my promise. So, if one says to another, "If you 
 will give me an order for iron, or other goods, I will supply it at a giv- 
 en price ;" if the order is given, there is a complete contract which the 
 seller is bound to perform. There is in such a case ample considera- 
 tion for the promise. So, here, the company having given the defend- 
 ant an order at his request, his acceptance of the order would bind 
 them. If any authority could have been found to sustain Mr. Sey- 
 mour's contention, I should have considered that a rule ought to be 
 granted. But none has been cited. Burton v. Great Northern Railway 
 Co., [9 Ex. 507; 23 L,. J. (Ex.) 184,] is not at all to the purpose. This 
 is matter of every day's practice; and I think it would be wrong to 
 countenance the notion that a man who tenders for the supply of 
 goods in this way is not bound to deliver them when an order is given. 
 I agree that this judgment does not decide the question whether the 
 
300 CONSIDERATION (Ch. 2 
 
 defendant might have absolved himself from the further performance 
 of the contract by giving notice. 
 Rule refused.^* 
 
 COHN v. LEVINE et al. 
 
 (Supreme Court of New York, Appellate Division, 1918. 185 App. Div. 529, 
 
 173 N. Y. Supp. 289.) 
 
 Action by Alex Cohn, trading as the Cohn Company, against Bar- 
 nett Levine and another, copartners. ' Firom an order granting plain- 
 tiff's motion for judgment on the pleadings, defendants appea;l. Or- 
 der reversed, .motion denied, and demiarrer sustained, with leave to 
 file amended complaint. 
 
 DowLiNG, J. This is an appeal from an order granting plaintiff's 
 motion for judgment on the pleadings, consisting of the complaint and 
 a demurrer thereto, which demurrer set forth that the complaint did 
 not state facts sufficient to constitute a cause of action. 
 
 The complaint alleges that on or about the 6th day of August, 1917, 
 the plainti'flF and defendants entered into an agreement in writing, 
 which was thereafter i-enewed on January 2, 1918," to continue until 
 December 31, 1918. The contract in substance was that the defend- 
 ants would furnish to the plaintiff -certain samples of ladies' and miss- 
 es' coats and suits identical with those furnished to salesmen for the 
 defendants, in order that plaintiff might take orders therefor, and that 
 upon the sale of such coats and suits by plaintiff to its customers the 
 
 s* The "acceptance" of an offer to supply such goods or services as the of- 
 feree may order or may desire creates no contractual, duty, because there is 
 no consideration. Northern Iowa Gas & Electric Co. v. Luverne, Iowa (D. .C.) 
 257 Fed. 818 (1919) ; Leach v. Kentucky Block Cannel Coal Co. (D. C.) 256 
 Fed. 686 (1919) ; Cooper v. Lansing Wheel Co., 94 Mich. 272, 54 N. W. 39, 34 
 Am. St. Rep. 341 (1892), holding also that an order for some specific quantity 
 makes the offer irrevocable ; Hudson v. Browning, 264 Mo. 58, 174 S. W. 393 
 (1915) ; Mowbray Pearson Co. v. E. H. Stanton Co., 109 Wash. 601, 187 Pae. 
 370, 190 Pac. 330 (1920); Chicago & G. E. Ry. Co. v. Dane, 43 N. Y. 240 
 (1870) ; Thayer v. Bui-chard, 99 Mass. 508 (1868) ; Teipel v. Meyer, 106 Wis. 
 41, 81 N.^W. 982 (1900); Petroleum Co. v. Coal, Coke & Mfg. Co., 89 Tenn. 
 381, 18 S. W. 65 (1890) ; American Cotton Oil Co. v. Kirk, 68 Fed. 791, 15 0. 
 C. A. 540 (1895); Westhead v. Sproson, 6 Hurl. & N. 728 (1861); Burton v. 
 Great, Northern R. Co., 9 Bxch. 507 (1854), agreement to transport all grain 
 that defendant might present, for 12 months. Parke, B., said : "It would be a 
 parallel case if a person agreed with a wine merchant to purchase of him all 
 the wine which the former might choose to drink during a year, and before 
 six months expired he gave notice, that he discontinued drinking wine"); 
 Percival v. London, etc., Committee, [1918] 87 L. J. K. B. 677. . 
 
 A specific order in accordance with the standing offer crejites.a contract tor 
 the ,amount ordered, bilateral unless the pi-ice accompanies the order. Na- 
 tional Surety Co. v. Atlanta (Ga. App.) 102 S. E. 175 (1920) ; Keller v. Ybarru, 
 3 Cal. 14T (1853) ; Cooper v. Lansing Wheel Co., supra. 
 
 A promise to buy land if any is f bund that suits the promisor, is enforce- 
 able, if a consideration i^ .given for it, and if the condition is fulfilled. Bells 
 Bros. v. Parsons, 132 Iowa, 543, 109 N. W. 1098, 11 Ann. Cas. 475 (1906). ' ' 
 
Sec; 4) MUTUAL promises as considebation 301 
 
 plaintiff would be entitled to the difference between ths cost price, to 
 be stipulated, and the price at which the plaintiff and his customers 
 should agree as the sales price. Bills of all merchandise manufac- 
 tured and shipped were to contain a statement that payment was to 
 be made at the place of business. of the defendants at 142 West Twenty- 
 Fourth street. New York City, and all checks for said merchandise 
 which came in for the Cohn Company were to be turned over to the 
 defendants. The agreement then contained the following provision: 
 
 "Upon the receipt of any and all checks as aforesaid, the parties 
 of the second part shall pay to the party of the first part the difference 
 between the amount which the customer was charged for the goods 
 and the amount which it was mutually agreed and determined that the 
 party of the first part shall be charged therefor." 
 
 The agreement also contained a stipulation that the defendants 
 should not directly or indirectly "drum" customers of the plaintiff, 
 and that, if. any goods should be sold by defendants to any of said 
 customers, the same should be sold in the name of the plaintiff, and 
 that the plaintiff should receive the difference between the price at 
 which the goods were to be sold to such customers and the price de- 
 termined upon as the basis of allowance for cost of material and la- 
 bor and for profit, the same as though the order had been given in the 
 first iristance to the plaintiff. A copy of the agreement in question 
 is annexed to the complaint. 
 
 The complaint further set forth that the plaintiff entered upon the 
 performance of the terms of the agreement and duly performed the 
 same. It then alleges that the defendants, "without just cause, pre- 
 vented plaintiff from fulfilling the terms and conditions of said con- 
 tract," and that defendants dispossessed plaintiff from space occu- 
 pied in defendants' place of business, and refused to deliver any of 
 the merchandise to be delivered to the customers of the plaintiff, as 
 set forth in the agreement, and wrongfully and unlawfully "converted 
 checks for merchandise sent by customers to plaintiff at the address 
 of the defendants in payment of bills for merchandise manufactured 
 and shipped by defendants to plaintiff's said customers, which were 
 sent by said customers to No. 142 West Tvi^enty-Fourth street, bor- 
 ough of Manhattan, city of New York, to the order of the plaintiff," 
 and that defendants secretly soHcited trade or "drummed" the cus- 
 tomers of plaintiff, and did not charge same to plaintiff, nor sell same 
 in plaintiff's name, all to the plaintiff's damage in the, sum of $4,000. 
 
 It is apparent that the contract was unilateral, and consisted 
 merely of an offer on thei part of the defendants to furnish samples to 
 the plaintiff for goods to be sold by him to his customers, and to be 
 delivered to them when procured. There is no agreement of any 
 kind on the part of the plaintiff either to take goods from the defend- 
 ants or to endeavor to bring to the defendants plaintiff's customers, 
 or other customers. The agreement is not under seal, and is not mutu- 
 
302 CONSIDERATION (Ch. 2 
 
 ally binding. The general rule in respect to such contracts is laid 
 down in Grossman v. Schenker, 206 N.. Y.. 466, 100 N. E. 39, as fol-: 
 lows : , : 
 
 "The general rule is that a promise, not under seal, , made > by one 
 party, with none by the other, is void, for, unless both are bound, 
 so that either can sue the other for a breach, neitber is bound." 
 
 While in certain special contracts courts have implied promises suf-r 
 ficient to create mutuality, the contract in the present case is not sub- 
 ject to any interpretation which would warrant the court in implying 
 that the plaintiff in any way agreed to take any particular amount of 
 merchandise, or to endeavor to sell or sell any of the designs of the 
 defendants. Plaintiff did not even agree to pay anything to defendr 
 ants, for they were to receive all the checks and pay the difference 
 between cost and selling price to plaintiff. 
 
 The learned trial justice in the case at bar seems to have laid 
 stress on the allegation in the complaint that the agreement had been 
 performed on the part of the plaintiff. While the Code authorizes 
 a general allegation of due performance by plaintiff of the condi- 
 tions precedent to a right of recovery on certain contracts, without 
 stating all of the facts constituting performance (Code of Civil Pro- 
 cedure, § 533), still the complaint in the case at bar sets forth no 
 facts which show that plaintiff had done a.nything under the. contract 
 which called for action upon the part of defendants, or imposed any 
 duty or obligation upon them under the contract. The complaint 
 wholly fails to state that the plaintiff obtained any customers what- 
 ever for defendants' goods, or ever notified defendants of its alleged 
 orders. 
 
 The learned court at Special Term upheld the complaint, upon the 
 ground that it set forth a cause of action in conversion; but plaintiff 
 admits upon this appeal that it sets forth no such cause of action, 
 nor could such a contention be successfully urged, inasmuch as, under 
 the contract, defendants were expressly given the right to receive all 
 checks for merchandise which came in for plaintiff, and were only 
 bound to turn over to plaintiff the difference between the amount of 
 such checks and the cost price of the goods agreed to be charged 
 against plaintiff by defendants. There are no facts alleged from 
 which it appears that plaintiff is even entitled to an accounting from 
 defendants. 
 
 The order appealed from will be reversed, with $10 costs and dis- 
 bursements, and the motion for judgment on the pleadings denied, 
 with $10 costs. The demurrer is sustained, with leave to plaintiff to 
 serve an amended complaint on payment of said costs. Order filed. 
 All concur. 
 
Sec. 4) MUTUAL PROMISES AS CONSIDBEATION 303 
 
 LIMA LOCOMOTIVE & MACHINE CO. v. NATIONAL STEEL 
 I CASTINGS CO. 
 
 (Circuit Court of Appeals of United States, 1907. 155 Fed. 77, 83 C. C. A. 
 593, 11 L. E. A. [N. S.] 713.) 
 
 In Error to the Circuit Court of the United States for the Western 
 Division of the Northern District of Ohio. 
 
 Action upon account for goods sold and delivered, and cross-action 
 for damages for breach of contract. Jury waived. The trial judge 
 made a finding of facts ,and a general finding for the plaihtiflE for the 
 full amount of the account and against thfe defendant upon its cross- 
 petition. 
 
 On April 10, 1902, the National Steel Castings Company made in 
 writing the following proposition to the Lima Locomotive & Machine 
 Company : "Gentlemen : We make the following proposition for fur- 
 nishing all yovir requirements in steel castings for the remainder of 
 the present year at the prices mentioned below, f . o. b. cars at Mont- 
 pelier, the terms to be thirty days net. You agree to furnish us on or 
 before the 15th of each month the tonnage that you wish to order dur- 
 ing the following month. We agree to fill your orders as specified 
 to the amount of this tonnage, and to make such deliveries as you 
 require." Then followed a schedule of steel castings and prices per 
 pound. This was accepted in writing by indorsing thereon, at the 
 foot of the proposition, "Accepted April 10, 1902," and duly signed 
 by the Lima Company. This contract the defendant set out in its 
 cross-petition and averred : First, that the castings for which the plain- 
 tiflf had sued were ordered and suppHed under this contract; second, 
 that the plaintiff had failed and refused, though requested, to sup- 
 ply it with other castings necessary to meet the requirements of its 
 business, and that defendant in consequence had been obliged to con- 
 tract for same with other founders and had paid for the castings 
 so procured $5,498.24 over and above the contract price with plaintiff. 
 
 The defenses to the cross-petition were : First, that the contract was 
 void for want of mutuality. ^° * * * 
 
 LuRTON, Circuit Judge, delivered the opinion of the court. 
 
 1. We find ourselves unable to agree with the learned circuit judge 
 in respect to the nonmutuality of the contract by which the plaintiff 
 agreed to supply all of the "requirements" of the defendant's business 
 for the remainder of the year 1902. The defendant was engaged in 
 an established manufacturing business which required a large amount 
 of steel castings. This was well known to the plaintiff, and the propo- 
 sition made and accepted- was made with reference to the "require- 
 ments" of that well-established business. The plaintiffs were not 
 proposing to make castings beyond the current requirements of that 
 
 65 Parts of the report, not dealing with this first defense, are omitted. 
 
304 CONSIDERATION (Cll. 2 
 
 business, and would not have been obligated to. supply castings not 
 required in the usual course of that business. By the acceptancfe of 
 the plaintiflf's proposal, the defendant was obligated to take from the 
 plaintiff all - casting^s which their business should require. The con- 
 tract, if capable of two equally reasonable interpretations, should be 
 given that interpretation which will tend to support it and thus carry 
 out the presumed intent of both parties. The second and third para- 
 graphs must be read in the light of the first. Thus read, there is no 
 ground for doubting that the words the "tonnage you wish to order," 
 and "such deliveries as you may require," have reference to the es- 
 tablished "requirements" of the business for the following "month," 
 and the deliveries of the tonnage tlius estimated. The contract falls 
 under and is governed by the case of lyoudenback Eertilizer Co. v. 
 Tennessee Phosphate Co., 121 Fed. 298, 58 C. C. A. ,220, 61 L. R. A. 
 402, where th^ contract was to sell to a manufacturer of fertilizer 
 "its entire consumption of phosphate.rqck" for a term of five years. 
 In that case we held that the contract was mutual, and the buyer un- 
 der obligation to take, its entire requirement of phosphate rock from 
 the seller. Concerning the deiiniteness of such a contract, we said: 
 
 "A contract to buy all that one shall require for one's own use in 
 a particular manufacturing business is, a vfery different thing from 
 a promise to buy all that one may desire, or all that one may order. The 
 proniise to take all that one can consume would be broken by buying 
 from another, and it is this obligation to take the entire supply of 
 an established business which saves the mutual character of the prom- 
 ise." 
 
 To. the same effect and directly in point are the cases of Cold Blast 
 Transp. Co. v. Kansas City Bolt & Nut Co., 114 Fed. 77, 52 C. C. A. 
 25, 57 L. R. A. 696; Minnesota Lumber Co. v. Whitebreast Coal Co., 
 160 111. 85, 43 N. E. 774, 31 L. R. A. 529, and Wells v. Alexandre, 130 
 N. Y. 642, 29 N. E. 142, 15 L, R. A. 218. * * * 
 
 Judgment reversed. "" 
 
 8 Other cases in accord: Jenkins & Co. v. Anaheim Sugar Co., 247 Fed. 958, 
 160 0. C. A. 658, L. E. A. 1918E, 29.3 (1918), contract to sell and to buy the 
 buyer's "August requirements" of beet sugar, the buyer being a wholesale 
 grocer ; ''a mere option to buy is readily, distinguishable from an agreement 
 to buy all to be required" ; Mclntyre Lumber & Export Co. v. Jackson Lum- 
 ber Co., 165 Ala. 268, 51 South. 767, 138 Am. St. Rep. 66 (1910), contract to 
 buy and to sell "all the ties * * * you manufacture at your mill until 
 notified to dispontinue cutting"; here, the plaintiff had the duty not to sell 
 to others and the power by manufacturing ties to create a duty in the de- 
 fendant to buy and pay for them, also he had the privilege of making no ties 
 at all; the defendant had the priyilege to buy of others and the power, by 
 giving notice, to terminate the plaintifC's power so far as it had not been 
 exercised ; Ayer & Lord Tie Co. v. O., T. O'Bahnon & Co., 164 Ky. 34, 174 
 S. W. 783 (1915), "all the ties that plaintiff could deliver before Jan. 1"; 
 Wells V. Alexandre, ISO N. Y. 642, 29 N. E. 142, 15 L. R. A. 218 (1891)> eon- 
 tract to supply vessels with all the coal they might use in a certain season ; 
 El Dorado Ice & Planing Mill Co. v. Kinard, 96 Ark. 184, 131 S. W. 460 (1910), 
 the entire output of any lumber millplaintifC might obtain; see also note in 
 
Sec. 4) MUTUAL PBOjaiSES AS CONSIDERATION 305 
 
 KOEHLER & HINRICHS MERCANTILE CO. v. ILEINOIS 
 
 GLASS, CO. 
 (Supreme Court of Minnesota-, 1919. 143 Minn. 344, 173 N. W., 703.) 
 
 Auction by the Koehler & Hinrichs Mercantile Company against the 
 Illinois Glass Company. Findings by the court for plaintiff, and 
 from an order denying a new ti-ial defendant appeals. Order affirmed. 
 
 Lees, C. This was an action to recover damages for breach of a 
 conti;-act of sale tried by the court without a jury. The findings were 
 in , plaintiff's favor, and defendant appeals f roin an order denying a 
 new trial. ' 
 
 Plaintiff is a dealer at wholesale in glassware, bottles, flasks, and 
 other rnerchandise. Its place of biisiness is at St. Paul. Defendant 
 is a manufacturer of glassware at Alton, 111., and has an agency for 
 the sale of its goods at St. Paul. On January 9, .1915, a contract in 
 writing between def ehdaint and the Koehler & Hinrichs Company was 
 executed. By its terms the former agreed to sell and the latter agreed 
 to buy, on or before December 31, 1916, 12 carloads of Ko-Hi flasks, at 
 a stipulated price, shipments to be made upon specifications furnished 
 by the buyer at least 30 days in advance of the shipping date, the final 
 specifications to be furnished not later than October 1, 1916. Pay- 
 ments were to be made within 30 days after shipment, with certain dis- 
 count privileges. It was provided that, if the financial responsibility 
 of the buyer became impaired or unsatisfactory to the seller, cash in 
 advance of shipment or satisfactory security might be demanded. 
 There was a clause reading as follows : 
 
 "It is agreed that under this contract Koehler & Hinrichs Company 
 may have the privilege of increasing quantity as much as they may de- 
 sire at price shown herein during the period covered by this contract." 
 
 On June 6, 1916, the contract was assigned by Koehler & Hinrichs 
 Company to Koehler & Hinrichs Mercantile Company, the plaintiff in 
 this action. The latter was a corpor-ation organized to succeed to the 
 business of the former and became the owner of all its assets at that 
 time. Prior thereto defendant had furnished and been paid for two 
 carloads of Ko-Hi flasks. Defendant had notice of the transfer to 
 plaintiff as early as Jul)^ 1, 1916. Between that date and August 25th 
 followin"-, defendant furnished the plaintiff, at various times and upon 
 its orders' and specifications, 1 carload of flasks. They were furnished 
 and paid for in accordance with the terms of the contract. Between 
 
 1 A L R 1392: Kenan, MdKay & Spier v. Yorkville Cotton Oil Co., 109 S. C. 
 4fi5> 96 a E 524 1 A. L. R- 13CT (1918), "season's output"; Pittsburgh Plate 
 Gln'ss Co' V "h Neuer Glass Co., 253 Fed. 161, 165 C. C. A. 61 (19l8) ; Raraey 
 Tnmber Co'v' John Schroeder Lumber Co., 237 Fed. 39, 150 C. C. A. 241 
 (1916) Stuart v. Home Tel. Co. of Detroit, 161 Mich., 123, 125 N. W. 720 
 nqinr "our reauirements up to the amount of 500"; National Pub. Co. v. 
 International Paper Co. (C. C. A. 2d) 269 Fed. 903, decided November 12, 1920, 
 "the entire supply of, half ^tone newspaper required to print rotogravure sup- 
 plements, * * * estimated at 400 tons." 
 
 COBBIN CONT. 20 
 
306 CONSIDERATION (Ch. 2 
 
 August 25 and October 1, 1916, plaintiff furnished specifications and 
 delivered orders to defendant for 13 carloads of flasks, and was able 
 and offered to pay for them in cash at the contract price before they 
 were shipped, but defendant refused to furnish any of them. The 
 difference between the contract price of the flasks and their market 
 price when defendant refused to deliver them was $1,993.70. This 
 amount, with interest from January 1, 1917, was awarded to plaintiff.' 
 
 The questions we are called upon to decide are: (1) Whether the 
 contract was void for want of mutuality either generally or as to the 
 flasks ordered in excess of 12 carloads. (2) Whether the contract 
 was assignable, and, if not, whether defendant is estopped from de- 
 fending on that ground.^' 
 
 1. The contract contains an agreement by the glass company to 
 sell, and an agreemerit by the Koehler & Hinrichs Company to buy a 
 definite quantity of flasks at a stipulated price, payable on a day cer- 
 tain. It pfrovides for delivery of the flasks upon specifications to be 
 furnished by the buyer within a stated time, and it contains the clause 
 we have quoted, giving to the buyer the privilege of increasing the 
 quantity of flasks. 
 
 As to the 12 carloads, it is quite clear that the promises were not 
 all on one side, for there is an express agreement on the one hand to 
 sell and on the other to buy. Each party could hold the other to the 
 performance of its agreement. The promises were mutual, were made 
 at the same time, and are incorporated jn a bilateral contract. Such 
 promises so made are a sufficient consideration for each other. 1 
 Dun. Dig. § 1758;- Ellsworth v. S. M. Ry. Ex. Co., 31 Minn. 543- 
 549, 18 N. W. 822 ; Bayne v. Greiner's Estate, 1 18 Minn. 350, 136 N. 
 W. 1041 ; Page on Contracts, § 296. ' . ' 
 
 Furthermore, the parties, by their acts after the contract was exe- 
 cuted, treated it as one having mutuality of obligation. In March, 
 1916, the buyer sought to have it canceled. . The seller offered to can- 
 cel it if paid $500, and used this language in its letter in reply to the 
 request for cancellation: 
 
 "This contract is certainly a liability of the Koehler & Hinrichs 
 Company in case our factory sees fit to enforce it." 
 
 Later it wrote that it preferred to furnish the flasks specified in the 
 contract at the contract price, and did not wish to cancel it or release 
 the buyer. No further attempt was made to do away with the con- 
 tract, but, on the contrary, it was acted upon by the delivery to plain- 
 tiff in small lots of another carload of flasks. The conduct of the par- 
 ties amounted to a practical recognition of the binding eft'ect of the 
 contract in so far as the sale of 12 carloads of flasks was involved, 
 and we decline to hold that it was void for want of mutuality. 
 
 The court found that 3 carloads of flasks were delivered, leaving 9 
 
 5 7 Part of tlie opinion, dealing with question (2), is omitted. The court held 
 that the right to delivery of the glass was assignable, and was enforceable on 
 tender of the cash. 
 
•Sec. 4) MUTUAL PROMISES AS CONSIDERATION 307 
 
 to be delivered if there had been no increase in the quantity definitely 
 specified in the contract: Thirteen carloads more were ordered, but not 
 delivered, and, damages were awarded for the failure to make delivery 
 of that quantity, the court giving effect to the option clause in the con- 
 tract. It is confidently asserted in defendant's behalf that this portion 
 of the contract is unilateral and not supported by any consideration. 
 We liave examined the authorities cited to sustain this contention, but 
 think it is unnecessary to go beyond our own decisions in disposing of 
 the question. It has been before the courts on many occasions. There 
 is some diversity of opinion concerning the principles involved and 
 rnore in their application to specific cases. This court is now definitely 
 committed to the rule that if the party holding an option under a con- 
 tract has bought his option for value paid of absolutely agreed to be 
 paid, he may enforce it. Staples v. O'Neal,. 64 Minn. 27, 65 N. W. 
 1083; Gregory v. Shapiro, 125 Minn. 81, 145 N. W. 791; Murphy v. 
 Anderson, 128 Minn. 106, 150 N. W. 387; First Nat. Bank v. Corp. 
 Securities Co., 128 Minn. 341, 150 N! W. 1084; Scott v. Stevenson 
 Co., 130 Minn. 151, 153 N. W. 316. The r^le has been approved by 
 the United States Circuit Court of Appeals for this' circuit! Conley, 
 etc., Co. V. Multiscope, etc., Co., 216 Fed. 892, 133 C. C. A. 96. 
 
 The rule applies to the option given to the buyer in the contract 
 now under consideration. It was bound to take ai^d pay for 12 car- 
 loads of flasks. This obligation furnished the consideration not only 
 for the, seller's promise to furnish them, but also for its promise to fur- 
 nish a greater quantity if ordered by the buyer in accordance with the 
 terms of its option. The fact that some of the flasks were to be ship- 
 ped to Chicago, presumably for resale at a profit in a territory not 
 theretofore. covered by plaintiff, is of no importance. The option gave 
 the buyer "the privilege of increasing quantity as much as they may 
 desire * * * during the period covered by this contract." We 
 find nothing in the language employed indicating that it was the pur- 
 pose of the parties to limit the quantity the buyer might order to the 
 reasonable necessities of its established trade at St. Paul. * * * 
 
 AfiSrmed."* 
 
 5 8 In accord: Waters-Pierce Oil Co. v. Progressive Gin Co., 59 Okl. 262, 159 
 Pac 349 (1916) sale of 200 barrels gasoline with option on 200 barrels more ; 
 Cooper V. Lansing Wheel Co., 94 Mich. 272, 54 N. W. 39, 34 Am. St. Kep. 341 
 (1892)i, promise to supply "what wheels we may want during the season" be- 
 came irrevocable as soon as any specific order was given. 
 
308 GONSIDBKATION (Ch. 2 
 
 RAGUE V. NEW YORK EVENING JOURNAL PUB. CO. 
 
 {Supreme Court 'of New York, Appellate Division, 1914. 164 App. Div. 126, 
 
 149 N. Y. Supp. 668.) 
 
 Actioti by William J. Rague against the" New York Evening Journal 
 Publishing Company. From an order denying plaintiff's motion for 
 judgment pn the pleadings, he appeals. Reversed, and motion granted. 
 
 Thomas, J. The plaintiiff was earning $21 per week from the sale 
 and distribution of the Evening Telegram. The defendant requested 
 him to discontiijue the distribution, with an .offer to pay' him therefor 
 $10.50 per week as long as he abstained from stich sale and distribu- 
 tion. The plaintiff, induced thereby, relinquished the. same, arid has 
 npt resumed it. The defendant for several mbnths paid the sum stip- 
 ulated, and then declined further payment. 
 
 The contract by its terms was not within the statute of frauds with 
 reference to, its completion within one year. Kent v. Kent, 62 N. Y. 
 560. It was not without consideration, as the plaintiff abandoned a 
 valuable business. The duration of the contract was not unmeasured, 
 as it would continue until plaintiff did an act, viz., resumed the sale of 
 the Telegram. Harrington v. Kansas City Cable Ry. Co., 60 Mo. App. 
 223; Carter White Lead Co. v. Kinlin, 47 Neb. 409, 66 N. W. 536; 
 McMullan v. Dickinson Co., 63 Minn. 405, 65 N. W, 661,. 663. 
 
 But it is urged that the contract failed in mutuality. There was all 
 the mutuality that the nature of defendant's offer permitted. The 
 plaintiff was not asked to promise, but to do air act. He made renun- 
 ciation of profitc^ble employment and was continuing it. That was 
 exact acceptance of all that was tendered. The plaintiff did not prom- 
 ise, but he did the required thing. Mutuality does not depend on 
 words alone. It is unimportant that the continuance of the renuncia- 
 tion depends upon plaintiff's will. If a master' owe, or is claimed to 
 owe, a servant damages for. personal "injury, and promise him eriiploy- 
 ment in consideration of a release therefor, and the release be given 
 and the employment undertaken, there is mutuality, although the serv- 
 ant may at his will cease worlcing. Carter White Lead Co. v. Kinlin, 
 supra. So when permanent employment is promised upon, similar con- 
 sideration.^* Pennsylvania Co. v. Dolan, 6 Ind. App. 109, 32 N. E. 
 802, 51 Am. St. Rep. 289. There was similar decision in Smith v. St. 
 Paul & Duluth R. Co., 60 Minn. 331, 62 N. W. 392 ; East Line & Red 
 River R. R. Co. v. Scott, 72 Tex. 70, 10 S. W. 99, 13 Am. St. Rep. 
 758; McMullan v. Dickinson Co., 63 Minn. 405, 65 N. W. 661, 663. 
 If A. offer to pay B. $500 upon the consideration that the latter lay 
 down a business, B. accepts by laying it down. The case does not dif- 
 fer in respect to mutuality if the offer be that B., relinquish the busi- 
 
 5 In accord: Texas Cent. R. Co. v. Eldredge (Tex. Civ. App.) 155 S. W. 
 1010 (1913) ; Paducah .Home Telephone & Telegraph Co. v. EUerbrook, 182 i 
 Ky. 193, 206 S. W. 282 (1918). 
 
Sec. 4,) MUTUAL PROMISES AS CONSIDERATION 309 
 
 ness in consideration of the payment of fixed installments, while the 
 relinquishment continues and B. acts upon it. In either, case, the offer, 
 upon B.'s compliance, becomes an obligatory promise, based upon 
 good consideration. 
 
 Both upon principle and authority the order should be reversed, 
 with $10 costs and disbursements, and the motion for judgment grant- 
 ed, with $10 costs. All concur.^" 
 
 WOOD V. LUCY, LADY DUFF-GORDON. 
 (Court of Appeals of New York, 1917. 222 N. Y. 88, 118 N. E. 214.)' 
 
 Cardozo, J. The defendant styles herself "a creator of fashfons." 
 Her favor helps a sale. Manufacturers of dresses, millinery, and 
 like articles are glad to pay for a certificate of her approval. The 
 things which she designs, fabrics, parasols, and what not, have a new 
 value in the public mind when issued in her name. She employed 
 the plaintiff to help her to turn this vogue into money. He was to 
 have the exclusive right, subject always to her approvalj to place 
 her indorsements on the designs of others. He was also to have the 
 exclusive right to place her own designs on sale, or to license others 
 to market them. In return she was to have one-half of "all profits and 
 revenues" derived from any contracts he might make. The exclu- 
 sive right was to last at least one year from April 1, 1915, and there- 
 after from year to year unless terminated by notice of 90 days. The 
 plaintiff says that he kept the contract on his part, and that the de- 
 fendant broke it. She placed her indorsement on fabrics, dresses, 
 and millinery without his knowledge, and withheld the profits. He 
 sues her for the damages, and the case comes here on demurrer. 
 
 The agreement of employment is signed by both parties. It has a 
 wealth of recitals. The defendant insists, however, that it lacks the 
 elements of a contract. She says that the plaintiff does not bind him- 
 self to anything. It is true that he does not promise in so many words 
 that he will use reasonable efforts to place the defendant's indorse- 
 ments and market her designs. We think, however, that such a prom- 
 ise is fairly to be implied. The law has outgrown its primitive stage 
 of formalism when liie precise word was the sovereign talisirian, and 
 e\?ery slip was fatal. It takes a broader view to-day. A promise 
 may be lacking, and yet the whole writing may be "instinct with an 
 obligation," imperfectly expressed (Scott, J., in McCall Co. v. Wright, 
 133 App. Div. 62, 117 N. Y. Supp. 775; Moran v. Standard Oil Co., 
 211 N. Y. 187, 198, 105 N. E. 217). If that is so; there is a contract. 
 
 The implication of a promise here finds support in many circum- 
 stances. The defendant gave an exclusive privilege. She was to 
 
 6 » Cited and followed in Western Newspaper Union v. Kitchel, 201 Mich. 
 121, 166 N. W. 1021 (1918). 
 
310 CONSIDERATION (Ch. 2 
 
 have no right for at least a year to place her own indorsements or 
 mai-ket her oiyn ; designs except through the agency of the plaintiff. 
 The acceptance of the exclusive agency, was an assumption of its 
 duties. Phoenix Hermetic Co. v. Filtrine Mfg. Co., 164 App. Div. 
 424, ISO N. Y. Supp. 193; W. G. Taylor Co. v. Bannerman, 120 
 Wis. 189, 97 N. W. 918 ; Mueller v. Mineral' Spring Co., 88 Mich. 
 390, 50 N. W. 319. We are not to suppose that one party was to 
 be placed at the mercy of the other. Hearn v. Stevens & Bro., HI 
 App. Div. 101, 106, 97 N. Y. Supp. 566; Russell v. Allerton, 108 N. 
 Y. 288, 15 N. E. 391. Many other terms of the agreement point the 
 same way. We are told at the outset by way of recital that: 
 
 "The said Otis F: Wood possesses a business organization adapted 
 to the placing of such indorsements as the said Lucy, Lady Duff- 
 Gordon, has approved." 
 
 The implication is that the plaintiff's business organization will 
 be used for the purpose for which it is adapted. But the terms of 
 the defendant's compensation are even more significant. Her sole 
 compensation for the grant of an exclusive agency is to be one-half 
 of all the profits resulting from tlie plaintiff's efforts. Unless he gave 
 his efforts-, she could never get anything. Without an implied promise, 
 the transaction cannot have such business "efficacy, as both parties 
 must have intended that at all events it should have." Bowen, L. 
 J., in The Moorcock, 14 P. D. 64, 68. Blit the contract . does not 
 stop there. The plaintiff goes on. to promise that he will account 
 monthly for all moneys received by him, and that be will take out all 
 such patents and copyrights and trade-marks as may in his judgment be 
 necessary to protect the rights and articles affected by the agreement. 
 It is true, of course, as the Appellate Division has said, that if he was 
 under no duty to try to market designs or to place certificates of in- 
 dorsement, his promise to account for profits or take out copyrights 
 would be valueless. But in determining the intention of the parties the 
 promise has a value. It helps to enforce the conclusion that the plaintiff 
 had some duties. His promise to pay the defendant one-half of the 
 profits and revenues resulting from the exclusive agency and to render 
 accounts monthly was a promise to use reasonable efforts to bring 
 profits and revenues into existence. For this conclusion the authof- 
 ities are ample. Wilson v. Mechanical Orguinette Co., 170 N. Y. 542, 
 63 N. E. 550; Phoenix Hermetic Co. v. Filtrine Mifg. Co., supra: 
 Jacquin v. Boutard, 89 Hun, 437, 35 N. Y. Supp. 496; Id., 157 N. 
 Y. 686, 51 N. E. 1091; Moran v. Standard Oil Co., supra; City of 
 N. Y. V. PaoH, 202 N. Y. 18, 94 N. E. 1077 ; Mclntyre v. Belcher, 
 14 C. B. (N. S.) 654; Devonald v. Rosser & Sons, [1906] 2 K. B. 
 728; W. G. Taylor Co. v. Bannerman, supra; Mueller v. Mineral 
 Spring Co., supra ; Baker Transfer Co. v. Merchants* R. & I. Mfg. 
 Co., 1 App. Div. 507, 37 N. Y. Supp. 276. 
 
 The judgment of the Appellate Division should be reversed, and the 
 
Sec. 4) MUTUAL PROMISES AS CONSIDERATION 311 
 
 order of the Special Term affirmed, with costs in the Appellate Divi- 
 sion and in this court. 
 
 CuDDEBACK, McLaughlin, and Andrews, JJ., concur. Hiscock, 
 C. J., and Chase and Crane, JJ., dissent. 
 
 Judgment reversed, etc.°^ 
 
 VICKREY et al. v. MAIER et al. 
 (Supreme Court of California, 1913. 164 Cal. 384, 129 Pac. 273.) 
 
 Action by O. A. Vickrey and another against Simon Maier and 
 another. Judgment for defendants, and plaintiffs appeal. Reversed. 
 
 Shaw, J. Appeal from the judgment on the judgment roll alone. 
 
 The complaint is in three counts upon three contracts of similar 
 form. The first is dated November 14, 1905, and is for the sale of 10 
 shares of the Maier Packing Company, a corporation, at $5,000. The 
 second and third are dated, respectively, August 20, and November 
 10, 1906; the second being for 20 shares of said stock at $10,000, 
 and the third for 30 shares at $15,000. A consideration of the first 
 contract will be determinative of all questions presented, except that of 
 the statute of limitations. 
 
 On November 14, 1905, plaintiffs subscribed for the 10 shares of 
 stock, and paid $5,000 to said company therefor; that being the par 
 value. The shares were issued to them on February 20, 1906, and 
 they have ever since held and owned the same. Upon the date they 
 subscribed the plaintiffs and defendants executed a written agreement 
 as follows f "This agreement made and entered into this 14th day 
 of November, 1905, by and between Simon Maier and John T. Jones, 
 parties of the first part, and O. A. and B. L. Vickrey, party of the 
 second part, witnesseth: That whereas said second party has sub- 
 scribed for 10 shares of the capital stock of the Maier Packing Co., 
 a corporation, the first parties are desirous of securing the first right 
 to purchase said stock in the event second party may desire to sell the 
 same : Now, therefore, said second party agrees that, before offering 
 said stock for sale, he will first notify first parties and give them the 
 first right to buy the same at the price offered by any bona fide in- 
 tending purchaser. In consideration of which said first parties agree 
 
 61 other cases whexe the court found a counter promise by Implication: 
 Bridgeford & Co. t. Meagher, 144 Ky. 479, 139 S. W. 750 (1911), employment 
 contract ; American Publishing & Engraving Co. v. Walker, 87 Mo. App. 503 
 (1901) ; Doollttle v. Callender, 88 Neb. 747, 130 N. W. 436 (1911) ; Phelps v. 
 La Salle Hotel Co., 209 111. App. 430 (1918) ; Lascelles v. Clark, 204 Mass. 362, 
 90 N. E. 875 (1910), guaranty contract; Massachusetts Biographical Society 
 V. Russell, 229 Mass. 524, 118 N. B. 662 (1918) ; Newell v. Hill, 2 Mete. (Mass.) 
 180 (1840) ; Pordage v. Cole, 1 Wms. Saunders, 319 (1669) ; Whidden v. Bel- 
 more, 50 Me. 357 (1863). • 
 
 Such an implication was denied in Sorrentino v. Bouchet (Sup.) 161 N. Y. 
 Supp. 262 (1916). 
 
312 CONSIDERATION (Ch. 2 
 
 and obligate themselves to pay or cause to be paid to second party a 
 dividend of six per cent, per annum on said stock, payable quarterly, 
 and that at any time after six months from date hereof, on ninety 
 days' notice, they will purchase said stock at the price paid therefor 
 and six per cent, per annum from date of payment of last dividend, 
 but the party of the second part shall not be obligated to sell said stock 
 at the price paid therefor." 
 
 Dividends of 6 per cent, per annum were regularly paid by said 
 company on said stock down to and including the quarterly dividend 
 due on July 3, 1909: In each of the last two counts the date- "July 
 3, 1909," is, by what is obviously a clerical error, written July 3, 1910. 
 We attach no, importance to this misprision and disregard it entirely. 
 No other dividends have been paid on the stock. On March 4, 1910, 
 the plaintiffs gave to the defendants the following notice: "Messrs. 
 Simon Maier and John T. Jones-^Gentlemen : In accordance with the 
 provisions contained in three certain agreements between^ yourselves 
 upon the one part and the undersigned upori the other, of date of No- 
 vember 14, 1905, August 20, 1906, and November 10, 1906, respective- 
 ly, at which times the undersigned purchased from the Maier Packing 
 Company, a corporation, ten (10), twenty (20), and thirty (30) shares of 
 its capital stock, respectively, making a total purchase of sixty (60) 
 share's of the capital stock of the Maier Packing Company for the sum 
 of thirty thousand ($30,000) dollars, we request and demand that you 
 carry out the provisions of said agreernents and each, thereof by pay- 
 ing or causing to be paid to the undersigned all dividends now in ar- 
 rears upon said stock at the rate of six (6) per cent, per annum, pay- 
 able quarterly, and we further request and demand that you comply 
 with the provisions of said agreements and each thereof by purchas- 
 ing on or before ninety (90) days from date hereof said sixty (60) shares 
 of stock and paying us therefor the price paid for the same, to wit, 
 the sum of $30,000, and in addition thereto all said sums now unpaid 
 on account of dividends." 
 
 On September 12, 1910, plaintiffs tendered to defendants the said 
 shares of stock, and demanded that the defendants shotild pay to plain- 
 tiffs the price paid by the plaintiffs therefor, to wit, $5,000^ and the 
 further sum of $355.67' as interest on the $5,000, from the date of 
 payment of said last paid dividend to the date of the demand. The 
 defendants refused and still refuse to perform said agreement of 
 November 14, 1905, and have not paid said sums/or any part thereof. 
 The prayer of the complaint is for judgment for $32,134.01, being the 
 aggregate amount demanded upon the three contracts, including pur- 
 chase price and dividends unpaid. The action was begun on the day 
 of the tender and immediately thereafter. 
 
 The only defenses alleged in the answer are that there was no con- 
 sideration for«the agreements sued on, and that the action is barred 
 by the provisions of section 337 of the Code of Civil Procedure, pre- 
 
Sec. 4) MUTUAL PROMISES AS CONSIDERATION 313 
 
 scribing four years as the period of limitation. No evidence was offer- 
 ed in support of either of the defenses, and the plaintiffs offered 
 no evidence to prove a consideration. Upon the foregoing facts 
 the court below gave judgment for the defendants. 
 
 The complaint states facts sufficient to constitute a cause of action. 
 The agreement bound the defendants to perform two things : First, 
 to pay, or cause to be paid, quarterly, a dividend on the stock at the 
 rate of 6 per cent, per annum ; second, to repurchase the stock at the 
 price which the plaintiffs had paid therefor, with interest from the 
 date of the payment of the last dividend. No dividend has been 'paid 
 for the year beginning July 3, 1909. The dividends for that year on 
 the 10 shares of stock covered by the first contract amounljgd to $300. 
 The defendants had agreed to pay this sum to plaintiffs, and had failed 
 to do so, although it was past due. It was a direct undertaking 
 for the payment of money, and upon a breach thereof they were im- 
 mediately liable. The plaintiffs were therefore at least entitled to 
 recover the amounts of the quarterly dividends on all the stock due 
 and remaining unpaid at the time the action was begun. 
 
 There is no merit in the claiin that the agreement was without 
 consideration. Under the presumption in favor of written agreements, 
 as provided by section 1614 of the Civil Code, in the absence of proof 
 to the contrary, an adequate consideration must be presumed to have 
 passed, and, if necessary, vye must assume that it consisted of some- 
 tTiing of value not mentioned in the agreement itself, unless the terms 
 of the agreement are such as to exclude or forbid such assumption. If 
 the contract had not recited any consideration, the fact that it was 
 in writing would therefore be sufficient evidence thereof. But the 
 agreement, on its face, shows a consideration. It is a well-established 
 rule of the law of contracts that a promise by one party may be a 
 sufficient consideration for the promise of another; that where there 
 are mutual or reciprocal promises in a written agreement each con- 
 stitutes a consideration for the other, particularly where it is expressly 
 so declared. Gallagher v. Equitable, etc., Co., 141 Cal. 707, 75 Pac. 
 329; Van Loben Sels v. Bunnell, 120 Cal. 682, 53 Pac. 266; 1 Par- 
 sons on Cont. *p. 449; 1 Page on Cont. § 296; 1 Beach on Cont. § 
 178. Here the plaintiffs agreed that if they chose to sell the stock 
 they would give the defendants a preferred right to buy it over all 
 other purchasers. The defiendants deemed this a valuable thing, and 
 in consideration therefor they agreed. to pay dividends on the stock, 
 and also to buy the stock at plaintiff's option at any time after 6 
 months, on 90 days' notice, at a stated price. Under, the authorities 
 there was a sufficient consideration. 
 
 [The court then proceeded to discuss the application of the statute 
 of limitations, and held that it would not begin to run from the end 
 of the six months period next succeeding the making of the contract, 
 at which time the plaintiff's power of acceptance by giving notice 
 
314 CONSIDERATION (Ch. 2 
 
 would first exist, but from the time when the defendant refused to 
 perform his duty to pay after the end of the PO-day period and the 
 tender of the stock.] 
 Judgment reversed."^ 
 
 82 "Mutuality" of legal duty Is not necessary to the validity of a contract 
 A promise is enforceable, even though the promisee has the option of doing 
 nothing further, provided he has already performed the agreed consideration 
 for the promise. Hills v. Hopp, 287 111. 375, 122 N. B. 510 (1919), sale of 
 stock with agreement to buv it back, if buyer should be dissatisfied ; Murphy 
 V. Hanna, 37 isf. D. 156, 164 N. W. 32, L. R. A. 1918B, 135 (1917), securities de- 
 livered in return for promise to lend money as desired ; Ziehm v. Frank Steil 
 Brewing Co. of Baltimore aty, 131 Md. 582, 102 Atl. 1005 (1917), debt to a 
 third party ^aranteed in return for promise to buy beer of promisee only, the 
 latter making no i)romise to supply beer ; Himrod Furnace Co. v. Cleveland 
 & M. R. Co., 22 Ohio St. 451 (1872); Rague v. New York Evening Journal 
 Pub. Co., 164 App. Div. 126, 149 N. Y. Supp. 668 (1914), ante ; Western News- 
 paper Union v. Kitchel, 201 Mich. 121, 166 N. W. 1021 (1918) ; Underwood 
 Typewriter Co. v. Century Realty Co., 220 Mo. 522, 119 S. W. 400, 25 L. R. A. 
 (N. S.) 1173 (1909), ante ; Eldorado Ice & Planing Mill Co. v. Kmard, 96 Ark. 
 184, 131 S. W. 460 (1910) ; Nolle v. Mutual Union Brewing Co., 264 Pa. 534, 
 108 Atl. 23 (19l9) ; and see cases on Acceptance by Act or Forbearance, ante, 
 chap. I, sec. 4. 
 
 Further, a promise is not itself insufficient as consideration for a return 
 promise merely because it is conditional even though thei'e may be an option 
 left to the promisor. Scott v. Moragues Lumber Co., 202 Ala. 312, 80 South. 
 394 (1918), mutual promises to charter a vessel in case defendant should buy 
 one ; Golden Cycle Min. Co. v. Rapson Coal Min. Co., 188 Fed. 179, 112 C. C. 
 A. 95 (1911), sale of all the coal that buyer "may use" on its mine; Wells 
 V. Alexandre, 130 N. Y. 642, 29 N. E. 142, 15 L. R. A. 218 (1891). 
 
 A bilateral contract is not invalidated by the fact that one party retains' 
 the power of terminating it by giving a specified notice or by doing some other 
 voluntary act. McMuUan v. Dickinson Co., 63 Minn. 405, 65 N. W. 66i; 663 
 (1896) ; Thomas v. Anthony, 30 Cal. App. 217, 157 Pac. 823 (1916) ; Pilkington 
 V. Scott, 15 M. & W. 657 (1846) ; Merchants.' Life Ins. Co. v. Griswold (Tex. 
 Civ. App.) 212 S. W. 807 (1919). 
 
 A lease for which cash was paid is not invalidated by a provision giving 
 the lessee the "option" of surrendering it at any time. Northwestern Oil & 
 Gas Co. V. Branine (Okl.) 175 Pac. 533, 3 A. L. R. 344 (1918) ; Rich v. Don- 
 eghey (Okl.) 177 Pac. 86, 3 A. L. R. 352 (1918), where the court said: "The 
 trial court held that the contract granting this present vested interest iu the 
 land was 'unilateral and void.' Strictly speaking, a unilateral contract is one 
 in which there is a promise on one side only, the consideration on the other 
 side being executed. Evidently the term was not used in that sense by the 
 trial court, for such contracts are not void, but are equally as valid as bilat- 
 eral contracts, consisting solely of mutual promises to do some future act, in 
 which the cbnsideration of the promise of one party is a promise on the part 
 of the other. The term 'unilateral' is often used to express absence of mu- 
 tuality. In the case of contracts made up solely of mutual promises, eadi 
 the consideration for the other, where the promises of one party are so ex- 
 pressed as not to be absolutely binding on him, but to be performed only if 
 such party so wills, or a promise on but one side and no consideration there-~ 
 for, the one who makes the absolute promise in the one case, or the sole 
 promise in the other, is not bound to perform. The reason sometimes given is 
 that the contract is unilateral, or void for want of mutuality. The real rea- 
 son is that there is not a sufficient consideration for the promise. 'Considera- 
 tion is essential ; mutuality of obligation is not, unless the want of mutuality 
 would leave one party without a valid or available consideration for his prom- 
 ise.' " 
 
Sec. 4) MUTUAL PROMISES AS CONSIDERATION 315 
 
 MURPHY V. HANNA et al. 
 
 (Supreme Court of North Dakota, 1917. 37 N, D. 156, 164 N. W. 32, L. E. A. 
 
 1918B, 135.) 
 
 Action by Michael Murphy, receiver of the Medina State Bank 
 against L,. B. Hanna and others. Judgment for defendants, and plain- 
 tiff appeals. Reversed and remanded. 
 
 BiRDZELL, J.«» * * * ']^]^g complaint alleges an agreement be- 
 tween the Medina State Bank, on the one side, and the defendants, 
 jointly and severally, on the other, whereby the bank should deliver 
 such of its unpaid bills receivable as the defendant should elect to re- 
 ceive as collateral security, in consideration of which and of the 
 promise to repay the defendants would advance to the plaintiff bank 
 sufficient cash to meet all its obligations and enable it to continue its 
 banking -business. It is further alleged as the understanding of the 
 parties at the tiine that the amount needed would be upward of $20,000. 
 While the complaint is replete with allegations setting forth the in- 
 ducement of the contract, and circumstances which, if proved, might 
 be proper to consider in determining the amount of damages recov- 
 erable—allegations in aggravation of damages — the foregoing state- 
 ment comprises all the allegations touching the terms of the contract 
 entered into. Immediately following the foregoing is an allegation 
 of at least a partial performance of the agreement set forth. It is 
 alleged that in carrying out the terms of the agreement the defendant 
 selected and the plaintiff delivered to them bills receivable of the ap- 
 proximate value of $20,000, for the purpose of furnishing collateral 
 to such advances, which bills made up and constituted the assets of 
 the bank that were of such character as to be readily convertible into 
 cash. A careful examination of the allegations of the contract, con- 
 strued in the light of the inducing matter, but separate and apart from 
 the allegations as to what was done under it, leads us to conclude that 
 as a wholly executory, bilateral contract it was not enforceable, by 
 reason of a lack of mutuality of obligations. Viewed as an executory 
 contract, it is clear that the State Bank of Medina bound itself to bor- 
 row no money from the defendants, either absolutely or conditionally. 
 If the plaintiff bank had, after making the agreement above referred 
 to, found another bank or an individual that would have been willing 
 to advance the necessary cash upon more favorable terms than those 
 alleged, or reasonably implied from those alleged, it could not, with 
 reason, be contended that they would have been in any way liable to 
 the defendants, had they borrowed money from such third party. 
 Austin Real Estate & Abstract Co. v. Bahn, 87 Tex. 582, 29 S. W. 
 646, 30 S. W. 430; McMannus v. Bark, L. R. 5 Ex. 65. In the 
 Texas case referred to, the creditor agreed to an extension of one 
 
 6 3 Parts of the opinion are omitted. 
 
316 CONSIDERATION (Ch. 2 
 
 week, in consideration of the promise of the debtor to pay within that 
 time, and it was held that the promise of the creditor was without any 
 consideration, for the reason that the debtor was not obhged to retain 
 the money or to pay interest for any period. 
 
 The complaint in the case at bar states no fact from which it can 
 reasonably be inferred that the State Bank of Medina became bound 
 to borrow any money from the defendants, and in so far as it sought to 
 hold the defendants liable for the repudiation of an obligatiofi to loan 
 money, resting upon a counter obligation to borrow, we find no such 
 corresponding promise or obligation on the part of the plaintiff; nor 
 is there any allegation from which it can be reasonably .inferred that 
 any other detriment was suffered, or consideration furnished by the de- 
 fendants. In the case of Wells v. Alexandre, 130 N. Y. 642, 29 N. E. 
 142, 15 L. R. A. 218, so much relied upon by appellant in the case at 
 bar, there was a proposal to furnish certain steamers with such coal 
 as would be required for a stated period. The acceptance of the pro- 
 posal bound the owners to purchase such coal as would be required 
 in the operation of the vessels. Mutuality of obligation was present, 
 in that the purchasers were bound by their acceptance to purchase the 
 coal required from the sellers. The contract thus formed was thus 
 mutually obligatory from the beginning, and while prospectively in- 
 definite as to subject-matter, it nevertheless contained its own measure 
 of defiriiteness as to quantity. The court applied the maxim "Certum 
 est quod certum reddi potest," and held that dainages were recover- 
 able for breach of the contract. 
 
 There are many cases in the books in which it is held that damages 
 may be recovered for breach of contract, where the measure of per- 
 formance is indefinite, in the sense that exact quantities cannot be 
 determined in advance, as where, for instance, the quantity is to be de- 
 termined by the necessities of a business or the reasonable require- 
 ments of a factory. Hickey v. O'Brien, 123 Mich. 611, 82 N. W. 241, 
 49 L. R. A. 594, 81 Am. St.'Rep. 227; Dailey v. Clark, 128 Mich. 591, 
 87 N. W. 761; Minnesota Lumber Co. v. Whitebreast Coal. Co., 160 
 111. 85, 43 N. E. 774, 31 L. R. A. 529. But see Jenkins & Co. v. 
 Anaheim Sugar Co. (D. C.) 237 Fed. 278 [reversed by 247 Fed. 958, 
 160 C. C. A. 658, L. R. A. 1918E, 293]. But in all such cases upon 
 analysis it will be found that the contracts involved mutuality of ob- 
 ligation, in that both parties had restricted their contractual freedom 
 by binding themselves mutually to the terms of an agreement involving 
 a limitation of legal rights — the purchasers being as much bound to 
 look to the particular source for the goods required as were the ven- 
 dors to supply them. In this there was consideration and mutuality 
 of obligation. In our opinion there is a clear distinction between a 
 case where a merchant agrees to buy from a certain seller such a quan- 
 tity of a certain kind of goods as he may require in the operation of his 
 business, and an agreement by a borrower to borrow sufficient money 
 to meet his existing obligations, the whole of which sum he could re- 
 
Sec. 4) MUTUAL PROMISES AS CONSIDERATION 317 
 
 turn at once without sustaining any liability whatsoever. The con- 
 tract set forth in the complaint is of this character, and it is conse- 
 quently lackiijg in the essentials necessary to make it a binding ob- 
 ligation for the loaning and borrowing of money. In so far as the 
 cornplaint purports to state a cause of action for the breach of a wholly 
 executory contract to loan money, and in so far as special damages 
 are predicated upon the breach of such a contract, the complaint is 
 demurrable, and the special damages are not recoverable. 
 
 But the foregoing considerations do not wholly dispose of fhe ques- 
 tions raised on this appeal. The complaint alleges more than a purely 
 executory contract. It alleges, as hereinbefore stated, the circumstances 
 in which the parties were negotiating, their purposes, and the objects 
 which they had in view, as well as the doing of certain things by way 
 of conforming to those purposes and realizing the objects. These alle- 
 gations give rise to an additional inquiry to determine whether a cause 
 of action in contract is stated. A contract may fail wholly as an execu- 
 tory agreement, carrying mutual obligations of the parties from the 
 time it is made, and yet result in contractual obligations depending 
 upon what is done in pursuance of it. Says Baron Parke in the case 
 of Kenneway v. Treleavan, 5 M. & W. 498, 151 Eng. Rep. 211 : 
 
 "But a great number of cases are of contracts not binding on both 
 sides at the time when made, and in which the whole duty to be per- 
 formed rests with one of the contracting parties. A guaranty falls 
 under that class. When a person says, 'In case you choose to employ 
 this man as your agent for a week, I will be responsible for all such 
 Slims as he shall receive during that time, and neglect to pay over to 
 you,' the party indemnified is not therefore bound to employ the per- 
 son designated by the guaranty; but, if he do employ him, then the 
 guaranty attaches, and becomes binding on the party who gave it." 
 
 [The court here referred to Ofiford v. Davies et al., 12 C. B. R. (N. 
 S.) 748; Great Northern R. R. Co. v. Witham, L. R. 9 C. P. 16; 
 Queen v. Demers, [1900] A. C. 103; 9 Cyc. 327; Willetts v. Sun 
 Mutual Insurance Co., 45 N. Y. 45, 6 Am. Rep. 31 ; and Slade et al. 
 V. Lexington, 141 Ky. 214, 132 S. W. 404, 32 L. R. A. (N. S.) 201.] 
 
 In the case of Chicago & Great Eastern R. R. Co. v. Dane, 43 N. 
 Y. 240, the defendant wrote a letter agreeing to receive and transport 
 not exceeding 600 tons of freight, on account of the Chicago & Great 
 Eastern Railroad Company, the addressee of the letter. The plaintiff 
 railway company promptly answered the letter as follows : "In behalf 
 of this company I assent to your agreement, and will be bound by its 
 terms." 
 
 The court held that the word "agree" in the defendant's letter was 
 equivalent to "offer," and that the plaintiff offeree had manifested an 
 unqualified assent to the terms of the offer. No contract resulted, 
 for the reason that the plaintiff had in no way bound itself by its 
 acceptance. The court in speaking of the effect of the purported ac- 
 ceptance, said (page 242): "This amounted to nothing more than 
 
318 CONSIDERATION (Ch. 2 
 
 the acceptance of an option by the plaintiff for the transportation of 
 such quantity of iron by the defendants as it chose; and had there 
 been a consideration given to the defendants for such option, the de- 
 fendants would have been bound to transport for the plaintiff such 
 iron as it required within the time and quantity specified, the plaintiff 
 having at its election not to require the transportation of any. * * * 
 There being no consideration for the promise of the defendants, ex- 
 cept this acceptance by the plaintiff, and that not binding it to furnish 
 any iron for transportation unless it chose, it follows that there was 
 no consideration for any promise of the defendants, and that the 
 breach of such promise furnishes no foundation for an action." 
 
 The court further held that, though the offer and purported ac- 
 ceptance created no contractual obligation, the defendant would have 
 been bound, had the plaintiff accepted defendant's proposition for any 
 specific quantity not beyond that limited. 
 
 [The court here discussed Thayer et al. v. Burchard et al., 99 Mass. 
 508 ; Minnesota Lumber Co. v. Whitebreast Coal Co., supra, 160 111. 
 85, 43 N. E. 774, 31 L. R. A. 529; Jones v. Vance Shoe Co., US Fed. 
 707, 53 C. C. A. 289; and United Press v. N. Y. Press Co., 164 
 N. Y. 406, 58 N. E. 527, 53 L. R. A. 288.] 
 
 In the Case at bar it is alleged that the defendants selected and the 
 plaintiff turned over to them bills receivable to the value of about 
 $20,000, and that this was done in pursuance of the agreement where- 
 by the defendants had undertaken to loan money to the plaintiff bank. 
 Even though the defendants' promise was not binding at the time it 
 was made, by reason of a lack of a corresponding obligation on the 
 part of the plaintiff to borrow money, yet they are in the' position,' as 
 a result of the agreement (using this term in the sense of common 
 understanding, rather than as referring to a legally binding contract) 
 entered into, of offering to loan to the plaintiff money in exchange for 
 collateral to be selected by the defendants and turned over by plain- 
 tiff. The plaintiff alleges a full compliance with the terms upon which 
 the defendants were willing and offered to loan money, and it further 
 alleges that the defendants repudiated their agreement and "refused 
 to advance any money to said bank to enable it to continue in business." 
 
 We are of the opinion that a contractual relation between the Me- 
 dina State Bank and the defendants sprang into existence by reason of 
 the selection and acceptance by the defendants of the collateral se- 
 curity. In the absence of any express agreement or understanding, 
 the defendants thereby became obligated to loan to the Medina State 
 Bank such a sum of money as would ordinarily be loaned by one bank 
 or individual to another upon such collateral security, under- all the 
 circumstances then existing and contemplated by the parties. It will 
 be competent to show, however, with what mutual understanding, if 
 any, the plaintiff bank parted with the securities which, it is alleged, 
 were turned over to the defendants. It is, of course, self-evident 
 that the defendants could, in no event, be held to have agreed to loan 
 
Sec. 4) SIUTUAL PROMISES AS CONSIUERATION 319 
 
 a sum in excess of that for which the $20,000 of collateral selected 
 by them was, under the arrangement alleged, considered by the parties 
 to be adequate security, and the only damages which defendants could 
 be holden for are those shown to have resulted from their failure to 
 loan such amount of money. As this case is before us on a demurrer, 
 we are, of course, wholly in the dark with respect to the actual facts 
 in the case, and must accept the facts stated in the complaint as true, 
 with reasonable inferences in their favor. 
 
 It is true that the complaint sets forth no specific promise to loan 
 a definite sum of money; but we are satisfied that, if the evidence 
 should clearly establish the facts alleged with reference to the under- 
 standing of the parties at the time, the jury would have a right to infer 
 from such facts an agreement to advance what would be considered 
 a reasonable sum, in view of all the circumstances, including the value 
 of the securities turned over. This matter, however, njust depend 
 wholly upon the evidence to be adduced at the trial. It must be borne 
 in mind that the transaction alleged is unusual, that it was made for a 
 special purpose, and that defendants had an apparent interest in the 
 accomplishment of the objects sought to be attained, chief of which 
 was the continued existence of the bank. It is not only alleged that 
 the assets turned over to the defendants were of the value of about 
 $20,000, but it is also alleged that they constituted "the assets of [the] 
 bank that were of the character that could be speedily converted into 
 cash or made available to enable such bank to continue in business." 
 
 A contract may be somewhat ambiguous and indefinite, not merely 
 as a result of words employed by the parties, but as a consequence of 
 more or less equivocal acts as well. In such cases it is fundamental 
 that, in measuring the obligation which one assumes by reason of his 
 words or conduct, it is competent to consider the surrounding circum- 
 stances, in order that the intention of the parties may be applied and 
 the obligation measured by the standard employed by the parties dur- 
 ing their negotiations. Merriam v. United States, 107 U. S. 437, 2 
 Sup. Ct. 536, 27 L. Ed. 531 ; 9 Cyc. 587, 588. The allegations quoted 
 above, if established, would, in our judgment, amount to what is 
 termed by the Supreme Court of Massachusetts, in the case of the 
 First National Bank v. Watkins, 154 Mass. 385, 28 N. E. 275, "an 
 ordinary case of a unilateral contract growing out of the offer of one 
 party to do something if the other will do or refrain from doing some- 
 thing else," and where it was held that: "If the party to whom such 
 an ofjfer is made acts upon it in the manner contemplated, either to the 
 advantage of the offerer or to his own disadvantage, such action makes 
 the contract complete." * * * 
 
 Reversed and remanded. 
 
320 CONSIDERATION (Ch. 2 
 
 SECTION 5.— PERFORMANCE OF PRE-EXISTING LEGAI, 
 
 DUTY 
 
 (Including Promises of Such Performance) 
 
 ■ REYNOLDS V. PINHOWE. 
 (In the King's Bench, 1595. Cro. Eliz. 429.) 
 
 Assumpsit. Whereas the defendant had recovered five pounds 
 against the plaintiff; in consideration of four poimds given him 
 by the plaintiff, that the defendant assumed to acknowledge satis- 
 faction of that judgment before such a day; and that he had not done 
 it. And it was thereupon demurred ; for it was moved, that there 
 was not any consideration; for it is no more than to ;giye him part 
 of the money which he owed him, which is not any consideration. — 
 But all THE Court held it to be well ' enough ; for it is a benefit unto 
 him to have it without suit or charge : and it may be there was error 
 in the record, so as the party might have avoided it. Wherefore it 
 was adjudged for the plaintiff.^* 
 
 FOAKES V. BEER. 
 (In the House of Lords, 1884. L. R. 9 App. Cas. 605.) 
 
 Appeal from an order of the Court of Appeal. 
 
 On August 11th, 1875, the. respondent recovered judgment against 
 the appellant for £2,077 17s. 2d. for debt and £13 Is. lOd. for costs. 
 On December 21st, 1876, a memorandurri of agreement was made and 
 signed by the appellant and respondent in the following terms: 
 
 "Whereas the said John Weston Foakes is indebted to the said Julia 
 Beer, and she has obtained a judgment in her Majesty's High Court of 
 Justice, Exchequer Division, for the sum -of £2,090 19s. And whereas 
 the said John Weston Foakes has requested the said Julia Beer to give 
 him time in which to pay such judgment, which she has agreed to do ^ 
 on the following conditions. Now this agreement witnesseth that in 
 consideration of the said John Weston Foakes paying to the said Julia 
 Beer on the signing of this agreement the sum of £500, the receipt 
 whereof she doth hereby acknowledge in part satisfaction of the said 
 judgnient debt of £2,090 19s., and on condition of his paying to her or 
 her executors, administrators, assigns or nominee the sum of £150 
 on July 1st and January 1st or within one calendar month after each 
 of the said days respectively in every year until the whole of the 
 
 8* S. c, Moore, K. B. 412, 1 Eolle, Abr. 28 (1595). This ease was cited with 
 approval by Justice Littledale in Wilkinson v. Byers, 1 Adol. & El. 106 (1834). 
 
Sec. 5) PERFORMANCE OP PRE-EXISTING LEGAL DUTY ' 321 
 
 said stun of £2,090 19s. shall have been fully paid and satisfied, the 
 first of such payments to be made on July 1st next, then' she the said 
 Julia Beer hereby undertakes and agrees that she, her executors, 
 administrators or assigns, will not take any proceedings whatever on 
 the said judgment." 
 
 The respondent having in June, 1882, taken out a summons for 
 leave to proceed on the judgment, an issue was directed to be tried 
 between the respondent as plaintiff and the appellant as defendant 
 whether any and what amount was on July 1st, 1882, due upon the 
 judgment. 
 
 At the trial of the issue before Cave, J., it was proved that the whole 
 sum of £2,090 19s. had been paid by instalments, but the respondent 
 claimed interest. The jury under his Lordship's direction found that 
 the appellant had paid all the sums which by the agreement of De- 
 cember 21st, 1876, he undertook to pay and within the times therein 
 specified. Cave, J., was of opinion that whether the judgment was 
 satisfied or not, the respondent was, by reason of the agreement, not 
 entitled to issue execution for any sum on the judgment. 
 
 The Queen's Bench Division (Watkin Williams and Mathew, JJ.) 
 discharged an order for a new trial on the ground of misdirection. 
 
 The Court of Appeal (Brett, M. R., Undley, and Fry, L. JJ.) re- 
 versed that decision and entered judgment for the respondent for the 
 interest due, with cosDS.'^ * * * 
 
 Lord Blackburn.*' My Lords, the first question raised is as to what 
 was the true construction of the memorandum of agreement made 
 on December 21st, 1876. What was.it that the parties by that writing 
 agreed to? ■ 
 
 The appellants contend that they meant that on payment down 
 of £500, and payment within a month after July 1st and January 1st 
 in each ensuing year of il50, until the sum of £2,090 19s. was paid, 
 the judgment for that sum and interest should be satisfied, for an agree- 
 ment to take no proceedings on the judgment is equivalent to treat- 
 ing it as satisfied. This construction of the memorandum requires 
 that after the tenth payment of £150 there should be a further pay- 
 ment of £90 19s. made within the next six months. This is the con- 
 struction which all three Courts below have put upon the memoran- 
 dum. 
 
 The respondent contends that the true construction of the memo- 
 randum was that time was to be given on those conditions for five 
 years, the judgment being on default of any one payment enforceable 
 for whatever was still unpaid, with interest from the date the judg- 
 ment was signed, but that the interest was not intended to be for- 
 given at all. 
 
 8 5 11 Q. B. Div. 221. 
 
 66 The concurring opinions of Selborne, L. C, and of Lords Ktzgerald and 
 Watson are omitted. 
 
 COKBIN CONT. — 21 
 
322 CONSIDERATION (Ch. 2 
 
 If this is the true construction of. the agreement the judgment 
 appealed against is right and should be affirmed, whether the reason 
 on which the Court of Appeal founded its judgment was right or not. 
 I am, however, of opinion that the Courts below, who on this point 
 were unanimous, put the true construction on the memorandum. 
 I do not think the question free from difficulty. It would have been 
 easy to have expressed, in unmistakable words, that on payment 
 down of £500, and punctual payment at the rate of £300 a year till 
 £2,090 19s. was paid, the judgment should not be enforced either for 
 principal or interest ; or language might have been used which should 
 equally clearly: have expressed that, though time was to be given, 
 interest was to be paid in addition to the instalments. The words 
 actually used are such that I think it is quite possible that the two 
 parties put a different construction on the words at the time; but I 
 think the words "till the said sum of £2,090 19s. shall have been fully 
 paid and satisfied" cannot be construed as meaning "till that sum, 
 with interest from the day judgment was signed, shall have been 
 fully paid and satisfied,'' nor can the promise "not to take any pro- 
 ceedings whatever on the judgment" be cut down to meaning any 
 proceedings except those necessary to enforce payment of interest. 
 
 I think, therefore, that it is necessary to consider the ground on 
 which the Court of Appeal did base their judgtnent, and to say wheth- 
 er the agreement can be enforced. I constri* it as accepting and 
 taking £500 in satisfaction of the whole £2,090 19s., subject to the 
 condition that unless the balance of the principal debt was paid by 
 the instalments, the whole might be enforced with interest. If, in- 
 stead of £500 in money, it had been a horse valued at £500 or a 
 promissory note for £500, the authorities are that it would have been 
 a good satisfaction, but it is said to be otherwise as it was money. 
 
 This is a question, I think, of difficulty. 
 
 In Coke, Littleton, 212b, Lord Coke says:. "Where the condition 
 is for payment of £20, the obligor or feoffor cannot at the time ap- 
 pointed pay a lesser sum in satisfaction of the whole, because it is 
 apparent that a lesser sum of money cannot be a satisfaction of a 
 greater. * * * If the obligor or feoffor pay a lesser sum either 
 before the day or at another place than is limited by the condition, 
 and the obligee or feoffee receiveth it, this is a good satisfaction." 
 For this he cites Pinnel's Case [5 Rep. 117a]. That was an action 
 on a bond for £16, conditioned for the payment of £8 10s. on Novem- - 
 ber 11th, 1600. Plea that defendant, at plaintiff's request, before the 
 said day, to wit, on October 1st, paid to the plaintiff £5 2s. 2d., 
 which the plaintiff accepted in full satisfaction of the £8 10s. The 
 plaintiff had judgment for the insufficient pleading. But though this 
 was so. Lord .Coke reports that it was resolved by the whole Court 
 of Common Pleas "that payment of a lesser sum on the day in sat- 
 isfaction pf a greater cannot be any satisfaction for the whole, be- 
 
Sec. 5) PERPOEMANCE OF PRE-EXISTING LEGAL DUTY 323 
 
 cause it appears to the judges that by no possibility a lesser sum can 
 be a satisfaction to the plaintiff for a greater sum; but the gift of 
 a horse, hawk, or robe, etc., in satisfaction is good, for it shall be 
 intended that a horse, hawk, or robe, etc., might be more beneficial 
 to the plaintiff than the money, in respect of some circumstance, or 
 otherwise the plaintiff w;Quld not have accepted of it in satisfaction."^ 
 But when the whole sum is due, by no intendment the acceptance 
 of parcel can be a satisfaction to the plaintiff; but in the case at 
 bar it was resolved that the payment and acceptance of parcel be- 
 fore the day in satisfaction of the whole wotdd be a good satisfac- 
 tion in regard of circumstance of time; for peradventure parcel of 
 it before the day would be more beneficial to him than the whole at 
 the day, and the value of the satisfaction is not material; so if I 
 am bound in iZQ to pay you £10 at Westminster, and you request 
 me to pay you £5 at the day at York, and you will accept it in full 
 satisfaction for the .whole £10, it is a good satisfaction for the whole, 
 for the expenses to pay it at York is sufficient satisfaction." 
 
 There are two thingsTfciere resolved. First, that where a matter 
 paid and accepted in satisfaction of a debt certain might by any 
 possibility be more beneficial to the creditor than his debt, the Court 
 will not inquire into the a,dequacy of the consideration. If the 
 creditor, without any fraud, accepted it in satisfaction when it was 
 not a sufficient satisfaction it was his own fault. And that payment 
 before the day might be more beneficial, and consequently that the 
 plea was in substance good, and this. must have been decided in the 
 case. 
 
 There is a second point stated to have been resolved — viz. : "That 
 payment of a lesser sum on the day cannot be any satisfaction of 
 the whole, because it appears to the judges that by no possibility a lesser 
 sum can be a satisfaction to the plaintiff for a greater sum." This 
 was certainly not necessary for the decision of the case; but though 
 the resolution of the Court of Common Pleas was only a dictum, 
 it seems to me clear that Lord Coke deliberately adopted the dic- 
 tum, and the great weight of his authority makes it necessary to be 
 cautious before saying that what he deliberately adopted as law was 
 a mistake, and though I cannot find that in any subsequent case 
 this dictum has been made the ground of the decision, except in 
 Fitch V. Sutton [5 East, 230], as to which I shall make some remarks 
 later, and in Down v. Hatcher [10 A. & E. 121], as to which Parke, 
 B., in Cooper v. Parker [15 C. B. 828], said: "Whenever the question 
 may arise as to whether Down v. Hatcher is good law, I should 
 have a great deal to say against it," yet there certainly are cases in 
 which great judges have treated the dictum in Pinnel's Case as good 
 law. 
 
 67 Jaffray v. Davis, 124 N. Y. 164, 26 N. E. 351, 11 L. R. A. 710 (1891), debtor 
 gave promissory notes for part, secured by a chattel mortgage, and the debt 
 was held satisfied. 
 
324 CONSIDERATION (Ch. 2 
 
 For instance, in Sibree v. Tripp [15 M. & W. 33, 37], Parke, B., 
 says: "It is clear if the claim be a liquidated and ascertained sum, 
 payment of part cannot be satisfaction of the whole, although it 
 may, under certain circumstances, be evidence of a gift of the re- 
 mainder." And Alderson, B., in the same case says : "It is undoubt- 
 edly true that payment of a portion of a liquidated demand, in the 
 same manner as the whole liquidated demand which ought to be 
 paid, is payment only in part, because it is not one bargain, but .two — 
 viz., payment of part, and an agreement without consideration to 
 give up the residue. The Courts might very well have held the con- 
 trary, and have left the matter to the agreement of the parties, but 
 undoubtedly the law is so settled." After such strong expressions 
 of opinion, I doubt much whether any judge sitting in a Court of 
 the first instance would be justified in treating the question as open. 
 But as this has very seldom, if at all, been the ground of the decision 
 even in a Court of the first instance, and certainly never been the ground 
 of a decision in the Court of Exchequer Chamber, still less in this 
 House, I did think it open in your Lordships' House to reconsider 
 this question. And, notwithstanding the very high authority of Lord 
 Coke, I think it is not the fact that to accept prompt payment of a 
 part only of a liquidated demand, can never be more beneficial than 
 to insist on payment of the whcle. And if it be not the fact, it cannot 
 be apparent to the judges. 
 
 I will first examine the authorities. If a defendant pleaded the 
 general issue, the plaintiff could join issue at once, and if the case 
 was not defended get his verdict at the next assizes. But by pleading 
 a special plea, the plaintiff was obliged to reply, and the defendant 
 often caused the plaintiff, merely by the delay occasioned by reply- 
 ing, to lose an assize. If the replication was one to which he could 
 demur he made this sure. Strangely enough it seems long to have 
 been thought that if the defendant kept within reasonable bounds, 
 neither he nor his lawyers were to blame in getting time in this way 
 by a sham plea — that a chattel was given and accepted in satisfac- 
 tion of the debt. The recognized forms were giving and accepting 
 in satisfaction a beaver hat, Young v. Rudd [5 Mod. 86], or a pipe 
 of wine [3 Chit. Plead. (7th Ed.) 92] . All this is now antiquated. But 
 while it continued to be the practice, the pleas founded on the first 
 part of the resolution in Pinnel's Case were very common, and 
 that law was perfectly trite. No one for a moment supposed that a 
 beaver hat was really given and accepted; but every onp knew that 
 the law was that if it was really given and accepted it was a good 
 satisfaction. But special pleas founded on the other resolution in 
 Pinnel's Case, on what I have ventured to call the dictum, were cer- 
 tainly not common. I doubt if a real defence of this sort was ever 
 specially pleaded. When there really was a question as to wheth- 
 er a debt was satisfied by a payment of a smaller sum the defend- 
 
Sec. 5) PERFORMANCE OF PRE-EXISTING LEGAL DUTY 325 
 
 ant pleaded the general issue, and if it was proved to the satisfac- 
 tion of the jury that a smaller sum had been paid and accepted in 
 satisfaction of a greater, if objection was raised the jury might, per- 
 haps, as suggested by Holroyd, J., in Thomas v. Heathorn [2 B. & 
 C. 482], find that the circumstances were such that the legal effect 
 was to be as if the whole was paid down and a portion thrown back 
 as a god's-penny. This, however, seems to me to be an unsatisfac- 
 tory and artificial way of avoiding the effect of the dictum, and it 
 could not be applied to such an agreement as 'that now before this 
 House. 
 
 For whatever reason it was, I know of no case in which the question 
 was raised whether a payment of a lesser sum could be satisfaction 
 of a liquidated demand from Pinnel's Case down to Cumber v. Wane, 
 5 Geo. I [1 Sm. L. C. (8th Ed.) 357], a period of one hundred and 
 fifteen years. 
 
 In Adams v. Tapling [4 Mod, 88], where the plea was bad for 
 many other reasons, it is reported to have been said by the Court 
 that: "In covenant where the damages are uncertain, and to be re- 
 covered, as in this case, a lesser thing may be done in satisfaction, 
 and there 'accord and satisfaction' is a good plea." No doubt this was 
 one of the cases which Parke, B., would have cited in support of his 
 opinion that Down v. Hatcher [10 A. & E. 121] was not good law. 
 The Court are said to have gone on to recognize the dictum in Pinnel's 
 Case, or at least not to dissent from it, but it was not the ground of 
 their decision. In every other reported case which I have seen the ques- 
 tion arose on a demurrer to a replication to what was obviously a sham 
 or dilatory plea. 
 
 Some doubt has been made as to what the pleadings in Cumber v. 
 Wane [1 Str. 426] really were. I have obtained the record.'^ The 
 plea is that after the promises aforesaid, and before the issuing of the 
 writ, it was agreed between the said George and Edward Cumber 
 that he, the said George, "daret eidem Edwardo Cumber quandm no- 
 tam in script vocatam, a promissory note, manu propria ipsius Geor- 
 gii subscript pr. solucon eidem Edwardo Cumber vel ordini quinque 
 librarum," fourteen days after date, in full satisfaction and exonera- 
 tion of the premises and promises, which said note in writing the said 
 George then gave to the said Edward Cumber, and the said Edward 
 Cumber then and there received from the said George the said note 
 in full satisfaction and discharge of the premises and promises. 
 
 The replication is that "the said George did not give to him Edward 
 any note in writing called a promissory note with the hand of him 
 George subscribed for the payment to him Edward or his order of 
 £5, fourteen days after date -in full satisfaction and discharge of the 
 premises and promises." To this there is a demurrer and judgment 
 
 88 The reference is: Queen's Bench (Plea side) Plea Boll, 5 Geo. I. 
 Trinity, ro. 173. 
 
326 OONSIDBEATION (Ch. 2 
 
 in the Common Pleas for the: plaintiff "that the replication was good 
 in laiw." 
 
 The reporter, oddly enough, say* there was an immaterial replica- 
 tion. The effect of the replication is to put in issue the substance of 
 the defence — ^namely, the giving in satisfaction; Young v. Rudd [5 
 Mod. 86], and certainly that was not immaterial. But for some rea- 
 son, I do not stop to inquire what, Pratt, C. J., prefers to base the 
 judgment affirming that of the Common Pleas on the supposed badness 
 of the plea rather thkn on the sufHciency of the replication. It is 
 impossible to doubt that the note, which it is averred in the plea 
 was given as satisfaction, was a negotiable note. And therefore this 
 case is in direct conflict with Sibree v. Tripp [15 M. & W. 23]. 
 
 Two cases require to be carefully considered. The first is Heath- 
 cote v. Crookshanks [2 T. R. 24] . The plea there pleaded would, I ' 
 think, now be held perfectly good, see Norman v. Thompson [4 Ex. 
 755]; but BuUer, J., seems to have thought otherwise. He says:, 
 "Thirdly, it was said that all the creditors were bound by this agree- 
 ment to forbear, but that is not stated by the plea. It is only alleged 
 that they agreed to take a certain proportion, but that is a nudum pac- 
 tum, unless they had afterward accepted it. In the case in which 
 Cumber v. Wane was denied to be law, Hardcastle v. Howard (26 Geo. 
 Ill, B. R.), the party actually accepted. But as the plaintiff in the pres- 
 ent case refused to take less than the whole demand, the plea is clearly 
 bad." 
 
 That decision goes entirely on the ground that accord without sat- 
 isfaction is not a plea. I do not think it can be fan-ly said that Buller, 
 J., meant by saying "that is a nudum pactum, unless they had afterward 
 accepted it," to express an opinion that if the dividend had been ac- 
 cepted it would have been a good satisfaction. But he certainly ex- 
 presses no opinion the other way. 
 
 In Fitch V. Sutton [5 East, 230] not only did the plaintiff not ac- 
 cept the payment of the dividend in satisfaction, but refused to accept 
 it at all, unless the defendant promised to pay him the balance when 
 of ability, and the defendant assented and made the promise re- 
 quired, so that but for the fact that other creditors were parties to 
 the composition there could have been no defence. There was no point 
 of pleading in that case, the whole being open under the general is- 
 sue. And in Steinman v. Magnus [11 East, 390] it was pretty well 
 admitted by Lord Ellenborough that the decision in Fitch v. Sutton 
 would have been the other way, if they had understood the evidence 
 as the reporter did. But though this misapprehension of the judges 
 as to the facts, and the absence of any acceptance of the dividend, 
 greatly weaken the weight of Fitch v. ■ Sutton, still it remains that 
 Lord Ellenborough, a very great judge indeed, did, however hasty 
 or unnecessary it may have been to express such an opinion, say: 
 "It is impossible to contend that acceptance of £17 10s. is an ex- 
 tinguishment of a debt of £50. There' must be some consideration 
 
Sec. 5) PEKFOEMANCE OF PRE-EXISTING LEGAL DUTY 327 
 
 for the relinquishment of the residue ; something collateral^ to show 
 a possibility of benefit to the party relinquishing his further claim, 
 otherwise the agreement is nudum pactum. But the mere promise 
 to pay the rest when of ability put the plaintiff in no better condition 
 than he was before. It was expressly determined in Cumber- v. Wane 
 that acceptance of a security for a lesser sum cannot be pleaded in sat- 
 isfaction of a similar security for a greater. And though that case 
 was said by me in argument in Heathcote v. Crookshanks [2 T. R. 24] 
 to have been denied to be law, and in confirmation of that BuUer, J., 
 afterward referred to a case (stated to be that of Hardcastle v. How- 
 ard [H. 26 Geo. Ill]), yet I cannot find any case of that sort, and none 
 has been now referred to; on the contrary, the decision in Ctimber 
 V. Wane is directly supported by the authority of Pinnel's Case, which 
 never appears to have been questioned." 
 
 I must observe that, whether Cumber v. Wane was, or was not 
 denied to be law in Hardcastle v. Howard, it certainly was denied to 
 be law in Sibree v. Tripp [15 M. & W. 23], and that, though it is quite 
 true that Pinnel's Case, as far as regards the points actually raised in 
 the case, has not only never been questioned, but is often assented to, 
 I am not aware that in any case before Fitch v. Sutton, unless it be 
 Cumber v. Wane, has that part of it which I venture to call the 
 dictum ever been acted upon ; and as I have pointed out, had it not 
 been for the composition with other creditors, there could have been 
 no defence in Fitch v. Sutton, whether the dictum in Pinnel's Case 
 was right or wrong. 
 
 Still this is an authority, and I have no doubt that it was on the 
 ground of this authority and the adhesion of Bayley, J., to it in 
 Thomas v. Heathorn [2 B. & C. 477], that Barons Parke and Alder- 
 son expressed themselves as they did in the passages I have cited 
 from Sibree v. Tripp. And I think that their expressions justify Mr. " 
 John William Smith in laying it down as he does in his note to Cum- 
 ber V. Wane, in the second edition of his Leading Cases, that "a liq- 
 uidated and undisputed money demand, of which the day of payment 
 is passed (not founded upon a hill of exchange or promissory note), 
 cannot even with the consent of the creditor be discharged by mere 
 payment by the debtor of a smaller amoUnt in money in the same man- 
 ner as he was bound to pay the whole." I am inclined to think that 
 this was settled in a Court of the first instance. I think, however, 
 that it was originally a mistake. 
 
 What principally weighs with me in thinking that Lofd Coke made 
 a mistake of fact is my conviction that all men of business, whether 
 merchants or tradesmen, do every day recognize and act on the ground 
 that prompt payment of a part of their demand may be more beneficial 
 to them than it would be to insist on their rights and enforce pay- 
 ment of the whole. Even where the debtor is perfectly solvent, and 
 sure to pay at last, this often is so. Where the credit of the debtor 
 is doubtful it must be more so. I had persuaded myself that there was 
 
328 , CONSIDERATION (Ch. 2 
 
 no such long-continued action on this dictum as to render it improper 
 in this House to reconsider the question. I had/ written my reasons for 
 so thinking; but as they were not satisfactory to the other noble and 
 learned Lords who heard the case, I do not now repeat them nor per- 
 sist in them. 
 
 I assent to the judgment proposed, though it is not that which I bad 
 originally thought proper. 
 
 Order appealed from affirmed, and appeal dismissed with costs.'* 
 
 H: 4: * 
 
 NASSOIY V. TOMUNSON. 
 
 (Court of Appeals of New York, 1896. 148 N. Y. 326, 42 N. B. 715, SI Am. 
 
 St. Rep. 695.) ' 
 
 Vann, J. On the sixth of April, 1887, the plaintiff sold the properly 
 of the defendants, under an agreement that he was to receive compen- 
 sation for his services ' in making the sale, but there was a difference 
 between them as to the amount. The sale was not completed until 
 about June 20th, 1887, on which day Mr. Chauncey, who represented 
 the defendants in all their dealings with the plaintiff, wrote to him as 
 follows : "I heard to-day from Mr. Griffith that the sale to Weston 
 was completed on Saturday. I send you ,a check for three hundred 
 dollars (1 per cent, on $30,000), your commission on the sale. Please 
 sign and return the enclosed voucher." There was a check for $300 
 
 60 The American cases In accord -witli Foakes v. Beer are legion, in spite 
 of much criticism of the rule. See Warren v. Skinner, 20 Conn. 559 (1850) ; 
 Jackson v. Security MUt. Life Ins. Co., 233 111. 161, 84 N. B. 198 (1906) ; 
 Bender v. Been, 78 Iowa, 283, 43 N. W. 216, 5 L. R. A. 596 (1889) ; CaU v. 
 Pinson, 180 Ky. 367, 202 S. W. 883 (1918) ; Zinke v. Knights of Maccabees of 
 the World, 275 Mo. 660, 205 S. W. 1 (1918) ; Decker v. George W. Smith & 
 Co., 88 N. J. Law, 630, 96 Atl. 915 (1916) ; Sherman v. Pacific Coast Pipe Co., 
 60 Okl. 103, 159 Pac. 333, L. R. A. 1917 A, 716 (1916); Clark v. Summerfield 
 Co., 40 R. I. 254, 100 Atl. 499 (1917) ; Wheeler v. Wheeler, 11 Vt. 60 ■(1839). 
 Also notes in 20 L. R. A. 785 ; 11 L. R. A. (N. S.) 1018 ; 21 L. R. A. (N. S.) 
 1005, L. R. A. 1917A, 719 ; 1 Oyc. 319, note 94. 
 
 Contra: Frye v. Hubbell, 74 N. H. 358, 68 Atl.N325, 17 L. R. A. (N. S.) 1197 
 (1907) ; Clayton v. Clark, 74 Miss. 499, 21 South. 565, 22 South. 189, 37 L. R. 
 A. 771, 60 Am. St. Rep. 521 (1896) ; Schuessler v. Lundstrom, 246 Fed. 439, 
 158 C. C. A. 503 (1917) (without discussion) ; Dreyfus & Co. v. Roberts, 75 
 . Ark. 354, 87 S. W. 641, 69 L. R. A. 823, 112 Am. St. Rep. 67, 5 Ann. Gas- 521 
 (1905), where a receipt in full is given. 
 
 At least ten states have nullified the rule of Foakes v. Beer by statute. 1 
 Cyc. 322. 
 
 A composition agreement between a debtor and two or more of his credi- 
 tors, providing for a discharge upon payment of a lesser sum, is universally 
 supported. A consideration may be found in the mutual promises of the 
 creditors or in the debtor's surrender of his privilege of preferring one credi- 
 tor over another. See Norman v. Thompson, 4 Ex. (W. H. & G.) 755 (1850) ; 
 Good V. Cheesman, 2 B. & Ad. 328 (1831), and note, post, p. 984. 
 
 Query: Is the consideration required for the extinguishment of a legal duty 
 identical with that required for the creation of such a duty by a promise? 
 See, further, the cases dealing with Accord and Satisfaction, post, chapter 
 V, section 6. 
 
Sec. 5) PERFORMANCE OF PRE-EXISTING LEGAL DUTY 329 
 
 enclosed, payable to the order of the plaintiff, and also an unsigned re- 
 ceipt in these words: "Suspension Bridge, New York, June, 1887. 
 Received of the Tomlinson Estate three hundred dollars, in full for 
 commissions for sale to J. A. Weston of 66 acre lot, $300." Under 
 date of June 23d, 1887, the plaintiff wrote to Mr. Chauncey, saying : 
 "I don't know what you mean by sending me a check for $300. I 
 want my five per cent, commission on the $30,000." No reply was 
 made to this letter, although one was requested, and during the latter 
 part of July or the first of August following, the plaintiff, who had in 
 the meantime retained both check and voucTier, called on Mr. Chaun- 
 cey in the city of New York, and, as he testified on the trial, asked him 
 what he meant by sending a check for $300 commission for selling the 
 farm. I said that I wanted my five per cent, commission, as the un- 
 derstanding was between us. He said he wouldn't give one cent more, 
 and I left him. * * * j knew there was a dispute between us, I 
 claiming $1500 and he claiming that I was only entitled to three hun- 
 dred dollars, and that his check paid that, and with the knowledge of 
 that condition of affairs I kept the check from July, 1887, to January, 
 1888, and then endorsed it and drew the money, and sent him a receipt 
 on account." The plaintiff never returned the blank voucher sent to 
 him with the check, but in January, 1888, he endorsed the check and 
 drew the money on it, and then, under date of January 19th, 1888, 
 wrote to Mr. Chauncey stating that he enclosed a receipt for $300, as 
 part payment for his services, and that he still claimed he was entitled 
 to five per cent, commission and insisted on being paid at that rate. 
 The receipt enclosed was for $300, "in part payment for commission." 
 On January 24th, 1888, Mr. Chauncey wrote to the plaintiff acknowl- 
 edging receipt of the letter and voucher, and stating that he should 
 "consider this payment in full for all commissions." The plaintiff did 
 not return or offer to return the money so paid him. When the plain- 
 tiff rested, as well as at the close of the evidence, the defendants asked 
 the Court to direct a verdict in their favor on the ground that, upon 
 the foregoing facts, which were not disputed, the plaintiff was not en- 
 titled to recover, but the motions were denied and the defendants ex- 
 cepted. ' 
 
 Two questions of fact were submitted to the jury: 1. Whether 
 there was an agreement to pay plaintiff at the rate of five per cent. 
 2. Whether the plaintiff agreed to accept the $300 "in place of his: 
 claim for five per cent, commission." The jury were instructed to find 
 for the plaintiff if they thought that the agreement to pay at that rate 
 was'made, and that the agreement to accept was not made, otherwise 
 for the defendants. They rendered a verdict in favor of the plaintiff 
 for $1,200. The judgment entered on the verdict was affirmed by the 
 General Term upon, its opinion written on a formial appeal, but then, 
 the record did not contain the proposed ■ receipt in full. Nassoiy v. 
 Tomlinson, 65 Hun, 491-493, 20 N. Y. Supp, 384. 
 
 The question presented by this appeal is whether the undisputed ev- 
 
330 CONSIDERATION (Ch. 2 
 
 idence so conclusively established an accord and satisfaction as to 
 leave no question of fact for the jury upon that subject. An accord 
 and satisfaction requires a newr agreement and the performance there- 
 of. Jaffray v. Davis, 124 N. Y. 164, 26 N. E. 351, 11 L. R, A. 710. 
 It must be an executed contract founded upon a new consideration, 
 although an agreement to accept an independent executory contract 
 has been held sufficient. Kromer v. Heim, IS N. Y. 574, 31 Am. Rep. 
 491 ; Morehouse v. Second National Bank, 98 N. Y. 503 ; 2 Parsons 
 on Contracts (7th Ed.) 817, 820. If the claim is liquidated, the mere 
 acceptance of a part, with 'the promise to discharge the whole, is not 
 enough, for there is no new consideration. Ryan v. Ward, 48 N. Y. 
 204, 8 Am. Rep. 539. If the claim is unliquidated, the acceptance of a 
 part and an agreement to cancel the entire debt, furnishes a new con- 
 sideration which is found in the compromise. A demand is not liqui- 
 dated even if it appears that something is due, unless it appears how 
 much is 'due, and when it is admitted that one of two specific sums is 
 due, but thereis a genuine dispute as to whi^ch is the proper amount, the 
 demand is regarded as unliquidated, within the meaning of that term 
 as applied to the subject of accord and satisfaction. Such is the case 
 before us, as appears from the testimony of the plaintiff, already quot^ 
 ed. He claimed that the defendants owed him the sum of $1,500, un- 
 der an agreement to pay him at one rate, while the defendants claim- 
 ed that they owed him but $300, under an agreement to pay him at 
 another rate. The verdict of the jury upon this issue neither removed 
 from the case the fact that a dispute had existed, nor affected its 
 force, as otherwise the compromise of a disputed claim could never be 
 made the basis- of a^alid settlement. We come, therefore, to the 
 question whether there was an acceptance by the plaintiff of an offer 
 by the defendants to pay the sum they conceded to be due in full sat- 
 isfaction of the sum he claimed to be due. In order to determine this 
 question, the letter of June 20th, 1887, with the check and receipt en- 
 closed therewith, should be construed together, so as to see whether 
 the offer was made upon a specified condition. When thus construed, 
 we find the defendant saying to the plaintiff, in substance : "Here is 
 a check for $300 to pay your commission on the sale ; sign and return 
 the enclosed voucher, in full of your commissions." As reflecting the 
 intention of the parties, it is the same in effect as if the check had 
 been written "in f till," as was the case of Reynolds v. Empire Lumber 
 Co., 85 Hun, 470, 33 N. Y. Supp. 111. The plaintiff understood the 
 condition as his testimony shows, and he never signed or returned the 
 voucher and did not use the check for nearly seven months. In the 
 meantime he had an interview with the agent of the defendants and 
 learned that they still adhered to their position of refusing to pay any 
 more than the check sent "in full." After hesitating for five months 
 longer, he used the check and sent the defendants a receipt on account, 
 writing them that he claimed a balance. Thig declaration was ex post 
 
Sec. 5) PERFORMANCE OP PRE-EXISTING LEGAL DUTY 331 
 
 facto and could have no effect unless acquiesced in by the defendants, 
 but they promptly disclaimed and insisted that their debt was paid. 
 We think that the undisputed evidence shows conclusively that the 
 offer was made in settlement of the claim and that the plaintiff so un- 
 derstood it, when, by using the check he accepted the offer. The 
 written evidence, the personal interview and the acts of the plaintiff 
 permit no other conclusion. The circumstances do not admit of differ- 
 ent inferences or present any question of fact, for the letter and re- 
 ceipt ,can have but one interpretation. 
 
 . The plaintiff cannot be permitted to assert that he did not under- 
 stand that a sum of money, offered "in full," was not, when accepted, 
 a payment in full. As was said in Hills v. Sommer, 53 Hun, 392, 394, 
 6 N. Y. Supp. 469, he was "bound either to reject" the check "or, 
 by accepting it, to accede to the defendants' terms." The money 
 tendered belonged to them, and they had the right to say on what 
 condition it should be received. "Always the manner of' the tender 
 and of the payment shall be directed by him that maketh the ten- 
 der or payment and not by him that accepteth it." Pinnel's Case, 
 5 Co. 117. The plaintiff could only accept the money as it was of- 
 fered, which was in satisfaction of his demand. He could not ac- 
 cept the benefit and reject the condition, for if he' accepted at all 
 it was cum onere. When he endorsed and collected the check, re- 
 ferred to in the letter asking him to sign the enclosed receipt in 
 full, it was the same in legal effect, as if he had signed and returned 
 the receipt, because acceptance of the check was a conclusive elec- 
 tion to be bound by the condition upon which the check was offered. 
 The use of the check was ipso facto an acceptance of the condi- 
 tion. The minds of the parties then met so as to constitute an ac- 
 cord, and, as was said by this Court in Fuller v. Kemp, 138 N. Y. 231, 
 33 N. E. 1034, 20 L. R. A. 785, "the acceptance of the money involved 
 the acceptance of the condition and the law will not permit any other 
 inference from the transaction." We cannot distinguish the case in 
 hand from the case last cited, where a check for $400 was mailed 
 with a letter stating that it was sent as payment in full of an unliqui- 
 dated demand for $670. The creditor accepted the check and used it, 
 but "again sent his bill to the defendant, charging $670 for his serv- 
 ices and crediting upon it $400 received by check." The debtor an- 
 swered, calling attention to the condition upon which he had sent the 
 check, and requesting the creditor "either to keep the money upon the 
 condition named, or return it to him by first mail," but no reply was 
 made, and the money was not returned. Upon these facts the Court 
 held that "when a debtor offers a certain sum of money in full satis- 
 faction of an unliquidated demand, and the creditor accepts and re- 
 tains the money, his claim is cancelled, and no protest, declaration or 
 denial on his part, so long as the condition is insisted upon by the debt- 
 or, can vary the result." 
 
332 CONSIDERATION (Ch.2 
 
 The principle that controlled that case must also control this, and 
 the judgment appealed from should, therefore, be reversed and a new 
 trial granted, with costs to abide the event. 
 
 All concur, except Haight, J., not sitting. 
 
 Judgment reversed."' 
 
 HAY v. FORTIER. 
 (Supreme Judicial Court of Maine, 191Y. 116 Me. 455, 102 Atl. 294.) 
 
 Action by George G. Hay against Mary A. Fortier. Case reserved. 
 Judgment for plaintiff. 
 
 King, J. The case made by the agreed statement is this : The de- 
 fendant became a surety on a 15-day bond given, by one Henry H. 
 Sawyer to the plaintiff., The conditions of the bond were not com- 
 plied with; and the defendant was notified of her liability under the 
 bond and requested to make payment thereof. On February 4, 1915, 
 the defendant's attorney wrote the attorney of the plaintiff as follows : 
 
 "I have seen Mrs. Fortier, who says it will be a great hardship to 
 pay this entire amount at the present time as the other signers are 
 worthless. She suggests * * * that she will pay you $100 next 
 week, if the papers are regular, and settle the balance by payments, 
 the whole bill to he paid before your April term of court. * * * " 
 
 To that the .plaintiff, through his attorney, replied sending copies of 
 the papers and saying: 
 
 "I am willing to accept $100 on account, providing you send same 
 
 7 In accord: Tanner v. Merrill, 108 Mich. 58, 65 N. W. 664, 31 L. R. A. 171, 
 62 Am. St. Rep. 68T (1895) ; Hull v. Johnson, 22 R. I. 66, 46 Atl. 182 (1900) ; 
 Janci V. Cerny, 28T 111. 359, 122 N. E. 507 (1919) ; Stanley-Thompson Liquor 
 Co. V. Southern Colorado Merc. Co., 65 Colo. 587, 178 Pac. 577, 4 A. L. R. 471 
 (1919) ; and note in 14 L. R. A. (N. S.) 954 ; Neely v. Thompson, 68 Kan. 193, 
 75 Pac. 117 (1904) ; Treat v. Price, 47 Neb. 875, 66 N. W. 834 (1896). 
 
 Contra : Demeules v. Jewel Tea Co., 103 Minn. 150, 114 N. W. 733, 14 L. R. 
 A (N. S.) 954, 123 Am. St. Rep. 315 (1908) ; Isaacs v. Wishnick, 136 Minn. 317, 
 162 N. W. 297 (1917) ; Driscoll v. Sullivan, 186 Ind. 178, 115 N. B. 331 (1917). 
 See, also, Whittaker Chain Tread Co. v. Standard Auto Supply Co., 216 Mass. 
 204, 103 N. E. 695, 51 L. R. A.. (N. S.) 315, Ann. Cas. 1915A, 949 (1913) and 
 cases cited, post, p. 1009. 
 
 Where a claim is unliquidated and uncertain in amount, no definite sum 
 being admitted as due, the payment and acceptance of a less sum than that 
 claimed operates as a satisfaction, if so ivgre^d. Alabama City, G. & A. K. 
 Co. V. City of Gadsden, 185 Ala. 263, 64 South. 91, Ann. Cas. 1916C, 573 (1913); 
 Root V. New Haven Trust Co., 82 Conn. 600, 74 Atl. 950 (1909) ; Minor v. 
 Fike, 77 Kan. 806, 93 Pac. 264 (1908) ; Chapin v. Little Blue School, 110 Me. 
 415, 86 Att. 838 (1913) ; Castelli v. Jereissati, 80 N. J. Law, 295, 78 Atl. 227 
 (1910) ; O'Brien v. American Agr. Chemical Co., 229 Fed. 387, 143 C. C. A. 
 507 (1916). 
 
 Payment by a third person of a lesser sum is valid consideration for a dis- 
 charge of a liquidated debt, even though (it seems) the money paid is sup- 
 plied by the debtor. Sigler v. Slgler, 98 Kan. 524, 158 Pac. 864, L. R. A. 
 1917A, 725 (1916) ; post, p. 1016; Marshall v. BuUard, 114 Iowa, 462, 87 N. W. 
 427, 54 L. B. A. 862 (1901) ; Bidder v. Bridges, 37 Ch. D. 406 (1887) ; Clark 
 y. Abbott, 53 Minn. 88, 55 N. W. 542, 39 Am. St. Rep. 577 (1893) ; note in 23 
 L. It. A. 120. See Accord and Satisfaction, post, pp. 979-1020. 
 
Sec. 5) PEEFORMANCB OF PEE-EXISTING LEGAL DUTY 333 
 
 to me immediately and the balance on or before the first Tuesday of 
 April. * * *" 
 
 The defendant paid the $100 forthwith, but no more. The plaintiff 
 waited till long after the first Tuesday of April, and on June 1, 1915, 
 brought an action of debt on the bond against the principal and all the 
 sureties. Mrs. Fortier answered to that action at the return term 
 thereof, and at a subsequent term, on November 3, 1915, by agree- 
 ment, that action was "discontinued without costs and without preju- 
 dice," the counsel of the respective parties signing the docket entry to 
 that effect. Why that action was thus discontinued does not appear in 
 this case. On the following day, November 4, 1915, this action was 
 brought against Mrs. Fortier, based upon a breach of her alleged spe- 
 cial promise to pay the bala,nce due under the bond before the April 
 term of court, as stated in the correspondence referred to. The dec- 
 laration is not made a part of the case, but the parties stipulate that it 
 "is in due form." The defense is that the alleged promise on which 
 the action is based was without a legal consideration and is therefore 
 nonenforceable. 
 
 We think the agreed statement justifies the conclusion, that the de- 
 fendant promised to pay at once $100, and the balance due under the 
 bond before the April term of court, provided the plaintiff would for- 
 bear action on the bond, and that the plaintiff on his part, in consid- 
 eration of such part payment at once, and the promise to pay the bal- 
 ance on or before the time specified, agreed to forbear, and did in 
 fact forbear, action on the bond until after the time specified. And a 
 promise to forbear and give time for the payment of a debt followed 
 by actual forbearance for the time specified or for a reasonable time 
 when no definite time is named, is certainly a sufficient consideration 
 for a promise to pay the debt. Moore v. McKenney, 83 Me. 80, 90,' 21 
 Atl. 749, 23 Am. St. Rep. 753. 
 
 On the other hand, it is obvious that the defendant by her special 
 promise did not agree to do anything that she was not then legally 
 bound to do. Her liability under the bond was then due and payable. 
 Shfe might then have been required to pay it all forthwith. And it is 
 a well-recognized principle that the payment, or promise of payment, 
 of money which is then due and payable by virtue of an existing valid 
 contract of the promisor, is not in contemplation of law a sufficient 
 consideration for any new contract. Wescott v. Mitchell, 95 Me. 377, 
 383, 50 Atl. 21 ; Dunn v. Collins, 70 Me. 230 ; Wimer v. Worth Town- 
 ship Poor Overseers, 104 Pa.- 317; Mathewson v. Strafford Bank, 45 
 N. H. 104; Parmelee v. Thompson, 45 N. Y. 58, 6 Am. Rep. 33; Bed- 
 ford's Ex'r V. Chandler, 81 Vt. 270, 273, 69 Atl. 874, 17 L. R. A. (N. 
 S.) 1239, 130 Am. St. Rep. 1057 ; 6 R. C. L. 664. The defendant 
 therefore contends that the plaintiff's .promise to forbear action on 
 the bond was without a legal consideration and not binding on him; 
 in other words, that he could have brought action on the bond imme- 
 diately after the part payment was made, in total disregard of his 
 
334 CONSIDERATION (Ch. 2 
 
 promise to wait until the April term of court. We think that conten- 
 tion is sound, and well supported by authorities. In Warren v. 
 Hodge, 121 Mass. 106, the court said : 
 
 "It is too well settled to require discussion or reference to authori- 
 ties that an agreement to forbear to sue upon a debt already due and 
 payable, for no other consideration than a payment of a part of the 
 debt, is without legal consideration, and cannot be availed of by the 
 debtor, either by way of contract or of estoppel." 
 
 But it does not follow, as the defendant claims, that this action 
 against her is not maintainable, simply because the plaintiff's promise 
 to forbear action on the bond could not have been enforced against 
 him during the specified period of forbearance. 
 
 "If a contract, altliough not originally binding for want of mutual- 
 ity, is nevertheless executed by the party not originally bound, so that 
 the party asserting the invalidity of the contract has actually received 
 the benefit contracted for, the latter will be estopped from refusing 
 perf orinance oh his part on the ground that the contract was not orig- 
 inally .binding on tlie other, who has performed." 6 R. C. L,. 690. 
 
 Granting that the parties, through the correspondence referred to, 
 entered into a bilateral contract, and that there was want of mutuality 
 in that contract because the plaintiff was not bound tO perform his 
 part of it, nevertheless, he did fully perform the contract ori his part, 
 and the defendant received the full benefit contracted for. Having 
 enjoyed the forbearance of the plaintiff from bringing action against 
 her on the bond for the full period agreed upon, the defendant is now 
 estopped from refusing performance on her part on the ground that 
 the contract was not originally binding on the plaintiff, who did, nev- 
 ertheless, perform it and she received the benefit thereof. 
 
 It is therefore the opinion of the court that this action is maintain- 
 able, and that the plaintiff is entitled to judgment against the defend- 
 ant for $175.60 and costs, with interest from the date of the writ. 
 
 So ordered. 
 
 MORTON V. BURN & A^AUX. 
 
 (In the King's Bench, 1837. 7 Adol. & El. 19.) 
 
 Assumpsit. The first count of the declaration stated that, where- 
 as, before and at the time of making the promise, etc., to-wit, 12th 
 April, 1834, the defendants were indebted to the plaintiff in i728. 2s. 
 6d., and interest thereon from 1st February, 1834, under and by virtue 
 of a bond dated 14th July, 1832, and a certain indenture and deed of 
 assignment thereof, dated 19th 'October, 1833; and that, according to 
 the condition of the said bon^, £228. 2s. 6d., part of the said sum of 
 £728. 2s. 6d., ought to have been paid on the 1st February then last 
 past; and thereupon, in consideration of the premises, and also in 
 consideration that plaintiff would accept and receive payment of the 
 
Sec. 5) PEEFOEMANCE OP PRE-EXISTING LEGAL DUTY 335 
 
 said sums of money on the da)^ and times after-mentioned, and, in 
 the meantime, give time to defendants for payment, the defendants 
 undertook, etc., that the whole of the said ;£228. 2s. 6d., with interest 
 from 1st February, 1834, should be paid to plaintiff on or before 1st 
 of June then next, or, in default thereof, that defendants would sign 
 a warrant of attorney to .plaintiff to enter up judgment against them 
 forthwith for the same; and that defendants would pay to plaintiff 
 £50 quarterly, on 1st September, etc., in every year, until the further 
 sum of iSOO (residue of the said £72%. 2s. 6d.), with interest at £S per 
 cent, per annum, should be fully paid and satisfied ; and, in default of 
 paying any of the last-mentioned instalments, defendants would exe- 
 cute a warrant of attorney to plaintiff forthwith to enter up judgment 
 against them for the whole £500 and interest, or so much thereof as 
 might then remain due ; averment that plaintiff did forbear and give 
 time to defendants for the payment of the said £728. 2s. 6d., and in- 
 terest, until and upon the respective days and times mentioned for 
 payment thereof in the said promise and undertaking of the defend- 
 ants; and, although defendants paid plaintiff the said £228. 2s. 6d. 
 and interest thereon, yet they did not nor would pay plaintiff £50 
 quarterly, on the days and times above mentioned in that behalf, but 
 therein wholly made default; and a large sum of money of the said 
 instalments, viz., £250, for five several sums of £50, respectively due 
 on 1st September, 1835, etc., now is wholly due and in arrear, etc. ; 
 and, although defendants made default in payment of the respective 
 sums on the days and times aforesaid, according to ^e tenor and ef- 
 fect, etc., of their said promise and undertaking, yet defendants did 
 not nor would execute a warrant of attorney to enable plaintiff forth- 
 with to enter up judgment against them for so much of the £500 and 
 interest as then remained due, etc. There was a second count on an 
 account stated, and for interest. 
 
 Pleas: 1. Non assumpsit. 2. To the first count, that there was not 
 any good or valuable consideration for the promises in the first count 
 mentioned ; conclusion to the country. Issues on both pleas. 
 
 On the trial before Coleridge, J., at the Middlesex Sittings after 
 Michaelmas Term, 1836, a verdict was found for the plaintiff. In 
 Hilary Term last, F. Edwards obtained a rule nisi for arresting the 
 judgment. 
 
 Cresswell and W. H. Watson now showed cause. 
 
 F. Edwards, contra. A detriment to the plaintiff or a benefit to the 
 defendant is a good consideration ; but here the agreement to forbear 
 was not binding on the plaintiff; he therefore gave up nothing, and 
 the defendant gained nothing. After the assignment the plaintiff 
 might have sued in equity in his own name, or at law in the name of 
 the obligee. And, again, the plaintiff's right is not strengthened by 
 the parol agreement : the defendant was. not less liable to these suits 
 before the agreement than after ; therefore he merely promised what 
 he was before liable to do, which was no consideration for a promise 
 
336 CONSIDERATION (Ch. 2 
 
 on the part of the plaintiff ; Harris v. Watson (Peake N, P. C. 72). 
 Now, if the plaintiff was not bound to perform his part of the agree- 
 ment, the defendant could not be liable. 
 
 [pATTfisoN, J. That proposition seems too broad. Suppose I say, 
 if you will furnish goods to a third person, I will guarantee the pay- 
 ment : there you are not bound to furnish them ; yet, if you do fur- 
 nish them in pursuance of the contract, you may sue me on my guar- 
 anty.] Here the contract could only be supported, by a consideration 
 perfect and definite at the time of the contract, and such that the par- 
 ty from whom it moved was, at the time, made incapable of retracting. 
 This is the only principle upon which the mutual promises can con- 
 stitute a consideration. * * * Again, if this were a good con- 
 tract, the defendant would be liable to two actions on the same instru- 
 ment ; for there is nothing' to prevent the original obligee, or an as- 
 signee of the present plaintiff, from suing the defendant on the bond 
 at any time. [Littledale, J. That would be an action for a dif- 
 ferent cause from this: that would be on the bond.; this is on the 
 parol contract.] 
 
 Cur. adv. vult. 
 
 Lord Denman, C. J., in this term (June 12th) delivered the judg- 
 ment of the court. 
 
 This is a motion in arrest of judgment. The question is, whether 
 forbearance for a given time on the part of the assignee of a bond to 
 sue the obligors, is a good consideration for a promise by the obligors 
 to pay the assignee at the expiration of, that time, or give him a war- 
 rant of attorney for the amount. 
 
 It was objected that there is no mutuality in the agreement; for 
 that, if the plaintiff had sued the defendants in the obligee's name, the 
 promise to forbear would be no answer. Again, that this is a mere 
 nudum pactum, being only a promise to do that which the defendants 
 were already bound to do, by their bond. And, further, that, if this 
 promise, be binding, it amounts to varying a deed by parol contract, 
 which is contrary to the rule of law. We do not think any of these 
 objections sufficient to arrest the judgment. 
 
 As to the first, there is sufficient mutuality ; for although the agree- 
 ment to forbear would not be pleadable to an action in the name of 
 the obligee, yet, unless the plaintiff did forbear according to his agree- 
 ment, he would not be able to sue on the defendant's promise. He is 
 obliged to aver, as he does in the present declaration, that he has for- 
 borne, which is a condition precedent to his suing. 
 
 As to the second objection, this is not a mere nudum pactum, for 
 the defendants promise to pay the plaintiff, a third person, whom 
 they were not bound to pay by their bond ; and they promise, in con- 
 sideration of a detriment sustained by the plaintiff at their request, 
 n^ely, a forbearance to enforce his right in the name of the obligee. 
 
 As ito the third objection the bond is in no respect varied by this 
 agreement. The new conti-act entered into by the defendants with 
 
t t 
 
 Sec. 5) PEEFORMANCE OF PRE-EXISTING LEGAL DUTY 337 
 
 the plaintiff leaves the bond just as it was before: it was forfeited be- 
 fore the agreement, and so it remains ; and the agreement would be no 
 answer to an action on it. 
 
 The cases on this subject are collected in Mr. Serjeant Willfams' 
 notes to Forth v. Stanton (1 Wms. Saund. 210), and to Barber v. Fox 
 (2 Wms. Saund. 137), to which may be added Yard v. Eland (1 L,d. 
 Raym. 368), and other cases collected in Comyns's Digest, Action on 
 the Case upon Assumpsit, Consideration (B). They are all in favor 
 of the action lying, with the exception of Potter v. Turnor (Palm. 
 185), which we think inconsistent, not only with the current of author- 
 ities, but with established principles. 
 
 For these reasons, we are of opinion that the rule to arrest the judg- 
 ment in this case must be discharged. 
 
 Rule discharged. 
 
 GORING v. GORING. 
 
 (In the King's Bench, 1602. Telv. 11.) 
 
 H. Goring was indebted to Smith in i205 upon simple contract; 
 Smith made J. Goring his executor and died; J.' Goring the executor 
 agreed, and was contented to take of H. Goring for the i205, £150 
 and also agreed to take the il50 by £20 per annum, in consideration 
 whereof H. Goring undertook, and promised to pay the said J. Goring 
 the said '^150 by £20 per annum, and for nonperformance of the 
 promise J. Goring brought %.ssumpsit against H. Goring; and upon 
 non assumpsit pleaded, 'twas found against H. Goring. And Hide 
 moved in arrest of judgment, that the consideration to take £150 for 
 £205 is not sufficient, because for anything that appears, H., Goring 
 remains still charged with the £205, and subject to the plaintiff's action 
 for the £205 and therefore he ought to have shewn that he had dis- 
 charg'd the defendant of the £205. Biit non allocat'; for the £205 
 being due to the plaintiff as executor of Smith, the action for it 
 ought to be in the detinet; but now, by this agreement to take £lS0 of 
 the defendant, a.nd the defendant's promise to pay it, 'tis made the 
 plaintiff's proper debt, and the action for it maintainable in his own 
 name, without being named executor, and altho' (by YelvErton, Jus- 
 tice) £150 is not any satisfaction of £205 because they are both of one 
 nature, and it's otherwise of things collateral to the debt, as an horse, 
 a cup, &c. yet in respect that the nature of the action is changed, it 
 proves the nature of the debt to be changed; and therefore a good 
 consideration: for if the executor is indebted to J. S. in £100 and 
 J. S. comes to demand the money, in this case, as the debt now is, 
 the executor is chargeable only in respect of the assets, and not other- 
 wise ; but if he promises to pay it at a day to come, 'tis now made his 
 own debt, and to be satisfied by his own goods. And (Per Curiam) 
 the; consideration alleged is sufficient for another reason; for although 
 
 C >KFIN CONT 22 
 
338 OONSIDEEATION (Ch. 2 
 
 the plaintiff has not shewn that he has discharged the defendaiit of 
 the i205 yet if the defendant should be afterwards charged with it, 
 he might have assumpsit against the plaintiff; for the plaintiff agree- 
 ing to take £150 for i205 is a promise on his part, and so one promise 
 against another. 
 
 MiELROY et al. v. KEMMERER. 
 (Supreme Court of Pennsylvania, 1907. 218 Pa. 381, 67 Atl. 699.) 
 
 Action by Emma E. M. Melroy and Thomas B. Bachman against , 
 Charles R. Kemmerer. Judgtnent for plaintiffs, and defendant ap- 
 peals. Reversed. 
 
 At the trial the defendant testified that on December 6, 1920, he had 
 paid the plaintiff 30 per cent, of the amount claimed, and that this 
 was a good accord and satisfaction of the whole claim, because, at 
 the time payment was made, palintiffs had dissuaded him from going 
 into bankruptcy. The court gave bindiiig instructions for plaintiffs. 
 Verdict and judgment for plaintiffs for $2,217.32. 
 
 Mitchell,, C. J. It was said in Ebert v. Johns, 206 Pa. 395, 55 Atl. 
 1064, that the rule that the acceptance of a smaller sum for a debt 
 presently due, though agreed and expressed to be payment in full, is 
 not -a good accord and satisfaction, was a deduction of scholastic 
 logic, and was always regarded as more logical than just, and hence 
 any circumstance of variation is sufficient to take a case out of the rule. 
 As illustrations of such circumstances of variation,, it has been held 
 that payment a day, or even an hour, before the debt is due, or at 
 a different place, or of a certainty in amount where the amount of 
 the debt is uncertain, or payment of even a part by a third person, 
 or additional security of any kind, such as the indorsement of a 
 note by a third person, or payment in chattels or anything other than 
 money, will be a good discharge of the whole by ■(vay of accord and 
 satisfaction. Note to Cumber v. Wane, 1 Smith, Lead. Case. *3S7: 
 And see a full collection of the more recent cases in the note to Fuller 
 V. Kemp (138 N. Y. 231, 33 N. E. 1034) in 20 L. R. A. 785. The 
 rule itself is founded on the want of consideration for the agreement; 
 As a part can never be equal to the whole, payment of a part of a 
 debt presently due gives the creditor nothing that he was not entitled 
 to and deprives the debtor of nothing he was not bound to part with 
 before, and therefore there is no consideration. The logic is unim- 
 peachable, but it fails to take into consideration the practical im- 
 portance of the difference between the right to a thing and the actual 
 possession of it. As said in Ebert v. Johns, 206 Pa. 395, 55 Atl. 1064, 
 "to a merchant with a note coming due $5,000 before 3 o'clock to- 
 day, which will save his commercial credit, may well be worth more 
 than $20,000 to-morrow, after his note has gone to protest." If the 
 debt is not due till to-morrow, the payment of the lesser sum under 
 
Sec. 5) PEBPOBMANCE OP PBE-EXISTING LEGAL DUTY 339 
 
 all the cases will be' a good accord and satisfaction ; but if the debt 
 was due yesterday, but the debtor can only pay part to-day, the bene- 
 fit to the creditor of getting that part now, rather than the whole when 
 it is too late, is just as great, and, whatever conclusion the scholastic 
 logic and theoretical reasoning may lead to, the importance of the 
 practical result is a matter for the creditor to decide for himself, and, 
 having so decided and got the benefit of it, justice and common hon- 
 esty ought to hold him to his agreement. For this reason, the force 
 of which is universally accepted, the courts, so far as they could 
 without sacrifice of the maxim of stare decisis, have brought the law 
 into closer accord with modern business principles. 
 
 In the present case the debtor, being in failing circumstances and 
 contemplating bankruptcy, offered the plaintiffs 30 per cent, of his debt 
 as a settlement in full. The plaintiffs dissuaded him from going into 
 bankruptcy, accepted his alternative offer, received the money, and 
 closed the account. They have now brought this suit for the balance. 
 In the absence of any express decision in this state on this point, the 
 learned judge below did not feel at liberty to depart from the general 
 rule. We have no such hesitation. The exact point is whether the 
 debtor's relinquishment of his intention to seek a discharge in 
 bankruptcy, and his payment of 30 per cent, instead, constitute a suffi- 
 cient consideration to bind the creditor to the agreement. On that 
 point we have no doubt. A valuable consideration may consist in 
 some right, interest, or benefit to one party, or some loss, detriment, 
 or responsibility resulting actually or potentially to the other. Bou- 
 vier's Law Diet. "If there is any advantage to the creditor, the law 
 will not weigh the adequacy of the consideration." Fowler v. Smith, 
 153 Pa. 639, 25 Atl. 744. The accord in this case was good on both 
 branches. By it the creditors got a sum certain, instead of the chances 
 of an uncertain 'dividend in bankruptcy. ,On the other hand, the debtor 
 accepted the responsibility of paying a sum certain, whether his as- 
 sets were sufficient or not, .and' gave up his right to a release of his 
 future assets, and to a discharge from his whole debt, without re- 
 gard to the sufficiency of his present assets. 
 
 The decisions on this exact point in other states are not numerous, 
 but the general trend is uniform to the result we have reached. In 
 Hinckley v. Arey, 27 Me. 362, it was said by Tenney, J. : "In this 
 case the plaintiff was informed that the defendant contemplated 
 taking the benefit of the bankrupt act, which was then in force. If 
 this intention had been carried out, the plaintiff would lose the whole 
 debt, beyond what he might receive as a dividend; and the latter, 
 judging from his letter, he did not consider as very valuable. To save 
 himself from a greater loss under the law, he agreed upon the term? of 
 composition offered. The defendant, upon the agreement and payment 
 to Hubbard, took no further steps to obtain relief under the bankrupt 
 law." It was accordingly held that the accord and satisfaction were 
 good. The same ruling was made in Dawson v. Beall, 68 Ga. 328. 
 
340 CONSIDERATION (Ch. 2 
 
 And in Curtiss v. Martin, 20 111. 557, 578, Engbretson v. Seiberling, 
 122 Iowa, 522, 98 N. W. 319, 64 L. R. A. 75, 101 Am. St. Rep. 
 279, and Rice v. London, etc., Mortgage Co., 70 Minn. 17, 72 N. W. 
 826, the courts went still farther and held the satisfaction valid where 
 the debtor was insolvent or in failing circumstances, though there was 
 no express intention to seek a discharge in bankruptcy. In the last- 
 named case it was held that an agreement on behalf of the estate of a 
 debtor supposed to be insolvent was good, though it turned out in fact 
 that it was solvent. And in Pettigrew Co. v. Harmon, 45 Ark. 290, the 
 principle that part payment by a third person makes the accord valid 
 was held to govern, where the third person was one to whom the debtor 
 had assigned his assets for the payment of his debts. On principle and 
 on authority, therefore, the agreement in the present case was binding, 
 and, there being no dispute on the material facts, the defendant's sixth 
 point, asking for binding instructions, should have been affirmed. 
 Judgment reversed.''^ 
 
 McCOMB V. KITTRIDGE. 
 (Supreme Court of Ohio, 1846. 14 Ohio, 348.) 
 
 The note upon which suit is brought, was given by Moses Kimball, 
 John Miller, Picket Latimer and the defendant Kittridge to James 
 Gilruth, for $2,000, dated September 1st, 1836, payable November 26th, 
 1836, endorsed by said Gilruth to Hamlin and Ward, and by them to 
 plaintiff. 
 
 The defence set up and relied upon in the special plea is, that 
 Kittridge executed this note, as surety for Kimball, which fact was 
 known to Gilruth at the execution and delivery of said note; that 
 Gilruth, after the same fell due, to wit, on the 9th of* February, 1837, 
 contracted to give further time, and delay the payment of the 
 same until the first of May, thereafter, in consideration of said Kim- 
 ball executing to him a note for $34.44, payable on said 1st of May. 
 That said note for $34.44 was executed, and a greater part thereof 
 paid. That the time specified was actually given, and that said agree- 
 ment was entered into without the knowledge or consent of the de- 
 fendant. 
 
 The replication denies the making of any such agreement. 
 
 Read, J. The pleadings admit, and the proof shows, beyond doubt, 
 that Kittridge was surety. Gilruth swears that the note was given 
 for money loaned ; that the whole negotiation was with Kimball, with 
 whom he always dealt in relation to the demand — that the note con- 
 tinued his property until 18th of September, 1837. This was long 
 after it was due, about ten months. 
 
 ^ ^ Under similar circumstances a contract between a lan'Hlord and an in- 
 solvent tenant, decreasing the rent, was held valid in Sherman, Clay & Co. v. 
 Buffum & Pendleton, 91 Or. 352, 179 Pac. 241 (1919). 
 
Sec. 5) PERFORMANCE OP PRE-EXISTING LEGAL DUTY 341 
 
 The part of Gilruth's testimony upon which the defence mainly 
 relies, is as follows: "On the 9th of February, 1837, the witness was 
 at Norwalk when the note was given, and called upon Kimball for 
 pay, who excused himself, and wanted delay; and it was proposed 
 to pay him ten per cent, as a consideration for it. The witness says : 
 ''I have consented to take the proposed interest, it being expressly 
 agreed that the notes should remain just as they were, instead of being 
 renewed. I agreed to wait until the first of May following." "Kim- 
 ball then calculated the extra four per cent, interest on the $2,000 
 till the first of May, and gave me his note for it, part of which was 
 traded out in his store the third of August following." He further 
 says, that the note of $34.44, of February 9, 1837, and due 12th of May, 
 1837, upon which he received from Kimball, August 3d, 1837, $24.63, 
 he afterwards sold, with the payments credited to Latimer. 
 " Now, the question arising upon the above state of facts, is, was 
 here such an agreement to give further time upon a Valid and binding 
 consideration as will discharge the surety? It is an undoubted prin- 
 ciple of law that, if the creditor, by agreement with the principal 
 debtor, or by any other act, precludes himself af law from proceeding 
 against the principal debtor, the surety is discharged. It is not ques- 
 tioned but that a binding agreement upon a valid consideration to give 
 further time to the printipal debtor, will discharge the surety. But 
 it is considered in this case, that there was no valid consideration for 
 the agreement to extend, the time of payment of this note, from the 
 9th of February, 1837, to the 1st of May following ; because the $34.44 
 note, the consideration of such agreement, was for a rate of, interest 
 larger than our statute allows to be collected. It is just as competent 
 for the principals to a note to extend the time of payment for a spec- 
 ified period, as it was to fix the time of payment originally. If the 
 lender of money, secured by a note, after the same becomes due, con- 
 tracts with the borrower that the time of paying the same shall be 
 extended for one year, or for any other period, upon consideration 
 that the borrower shall pay the legal or less rate of interest,' why is not 
 that a binding contract ? The lender, by this contract, secures to him- 
 self the interest on his money for the year — and the borrower pre- 
 cludes himself from getting rid of the paj'ment of the interest, by 
 discharging the principal. It is a valuable right to have money placed 
 at interest, and it is a valuable right to have the privilege,'^ at any 
 time, of getting rid of the payment of interest, by discharging the prin- 
 cipal. By this contract, the right to"" interest is secured for a given 
 period, and the fight to pay off the principal, and get rid of paying the 
 interest, is also relinquished for such period. Here, then, are all the 
 elements of a binding contract. 
 
 But it is said there is no consideration for the extension of time, 
 
 '2 That is, the power to terminate the duty to pay interest is a valuable 
 power. 
 
342 CONSIDJEEATION (ph. 2 
 
 because the law gives six per cent, after the note is due. But the 
 law does not secure the payment of this interest for, any given pe- 
 /iod — or prevent the discharge of the principal at any moment. There 
 js precisely the same consideration for the extension of . the time, 
 as there was for the original loan. The consideration of the loan, 
 on the part of the borrower, is the payment of ^interest. If there Was 
 no law limiting the amount of interest, the parties might contract for 
 any rate they pleased. A contract to forbear the collection, of a 
 debt for a specified period, in consideration of the payment of a 
 rate of interest beyond what the law allows, is founded upon a valid 
 consideration. This would never have been doubted at all, if the law 
 had not fixed the rate for which collection could be had. But, by lim- 
 iting the rate of interest, the law does not , declare that such rate 
 is not a valuable consideration, but on the contrary declares that 
 such rate is so fully valuable,- that it will not permit a higher rate 
 for the use of money or forbearance. The law would permit any 
 amount to be paid for forbearance, if it were not for the fact that this 
 would break down the whole policy of the law limiting the , rate of 
 interest; and that forbearance amounts to nothing more than a. mere 
 loan. The only doubt which has arisen from the fact in this case is, 
 that, in cotmtries where the law declares usurious contracts void, a 
 contract to pay usurious interest is void; and hence, such a contract 
 to pay, would form no consideration for an agreement to give time, 
 or forbear the collection of a debt for a specified period. Such a 
 contract with us is not wholly void, but the statute steps in and pares 
 it down to the legal rate, and permits that to be, collected. Hence, this 
 $34j44 note is a good and valid contract for the payment of six per 
 cent, interest — and hence, a good consideration to support the agree- 
 ment to extend the time of payment of the $2,000, to the time con- 
 tracted for ; and the original parties, without the knowledge of the 
 surety, having, by valid agreement, extended the time, the surety is 
 discharged. 
 
 This view carries out the spirit of the statute respecting interest, 
 secures it from the opportunity of violation, harmonizes with the, de- 
 cisions had under it, and rests,: in our opinion, upon a solid founda- 
 tion." 
 
 'Sin accord: Chute v. Pattee, 37 Me. 102 (1854); Benson v. PMpps, 87 
 Tex. 578, 29 S. W. 1061, 47 Am. St. Kep. 128 (1895) ; DieW v. McKinnoh, 173 
 Iowa, 32, 155 N. W. 259, L. R. A. 19160, 384 (1915), payee of note, aged 90 
 years, agreed to cancel note in return for promise of the maker to pay the 
 annual interest reserved in the note as long as the payee should live. Of. 
 Bright V. Briscoe (Tex. Civ. App.) 202 S. W. 183 (1918). 
 
 See extended note in 52 L. R. A. (N. S.) 331, appended to the case of Maker 
 V. Taft, 41 Okl. 663, 139 Pac. 970, 52 L. R. A. (N. S.) 328 (1914), discussing 
 very many cases both in accord and contra. 
 
 The statute of limitations begins to run anew from the date of maturity 
 of the new contract. First State Bank v. Bowman (Tex. Civ. App.) 203 S W. 
 75 (1918). 
 
Sec. 5) PERFORMANCE OP PRE-EXISTING LEGAL DUTY 343 
 
 STILK V. MYRICK. 
 (In the Court of Common Pleas, 1810. 2 Camp. 317.) 
 
 This was an action for seaman's wages, on a voyage from London to 
 the Baltic and back. 
 
 By the ship's articles, executed before the commencement of the 
 voyage, the plaintiff was to be paid at the rate of £5 a month; and 
 the principal question in the cause was, whether he was entitled to 
 a higher rate of wages. In the course of the voyage two of the sea- 
 men deserted, and the captain, having in vain attempted to supply 
 their places at Cronstadt, there entered into an agreement with the 
 rest of the crew, that they should have the wages of the two who had 
 deserted equally divided among therti if he could not procure two 
 other hands at Gottenburgh. ^his was found impossible, and the 
 ship was worked back to London by the plaintiff and eight more of the 
 original crew, with whom the agreement had been made at Cronstadt. 
 
 Lord EllEnborough. I think Harris v. Watson (Peak, 72) was 
 rightly decided; but I doubt whether the ground of public policy, 
 upon which Lord Kenyon is stated to have proceeded, be the true 
 principle on which the decision is to be supported. Here, I say, the 
 agreement is void forwant of consideration. There was no considera- 
 tion 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. They had sold 
 all their services till the voyage should be completed. If they had been 
 at liberty to quit the vessel at Cronstadt, the case would have been 
 quite different ; or if the captain had capriciously discharged the two 
 men who were wanting, the others might not have been compelled to 
 take the whole duty upon themselves, and their agreeing to do so 
 might have been a sufficient consideration for the promise of an ad- 
 vance of wages. But the desertion of a part of the crew is to be con- 
 sidered an emergency of the voyage as much as their death, and those 
 who remain are bound by the terms of their original contract to exert 
 themselves to the utmost to bring the ship in safety to her destined 
 port. Therefore, without looking to the policy of this agreement, I 
 think it is void for want of consideration, and that the plaintiff can 
 only recover at the rate of £5 a month. , 
 
 Verdict accordingly.'* 
 
 -74 In accord: Bartlett v. Wyraan, 14 Johns. (N. Y.) 260 (1817). 
 
344 CONSIDERATION (Ch. 2 
 
 I 
 
 ©AVIS & CO. V. MORGAN. 
 
 (Supreme Court of Georgia, 1903. 117 Ga. 504, 43 S. E. 732, 61 L. B. A, 148, 
 
 97 Am. St. Rep. 171.) 
 
 Action by A. M. Morgan against C. H. Davis & Co. Judgment for 
 plaintiff, and defendants bring error. Reversed. 
 
 IvAMAR, J. Davis & Co. employed Morgan for one year at $40 per 
 month. After the contract had been in force for some tirne, Morgan 
 received an offer of ^65 per month from a company in Florida, and 
 mentioned the fact to Davis, saying that of course he would not go 
 without consent. Davis insists that he then said, if Morgan would 
 stay out the balance of the term, and work satisfactorily, he would 
 give him $120 at the end of the year. Morgan says that Davis stated, 
 "I will add $10 a month from the time you began, and owe you 
 $120 when your time is, up." Davis & Co. discharged Morgan two 
 or three weeks before the end of the term, because the latter had gone 
 to Florida for several days without their consent. Morgan insists 
 that he told Davis that he was going, and the latter made no objection. 
 He claimed that he was discharged without proper cause, and brought 
 suit for the extra compensation promise4- The jury found a verdict 
 in his favor, and, the court having refused to grant a new trial, Davis 
 & Co. excepted. 
 
 If the promise contemplated that Davis & Co. were to pay Morgan 
 $10 per month for that part of the year which had already passed, and 
 as to which there had been a settlement, it was manifestly nudum 
 pactum; for a past transaction, the obligation of which has been 
 fully satisfied, will not sustain a new promise. Gay v. Mott, 43 Ga. 
 254. And the result is practically the same whether Morgan or Davis ' 
 was correct in the statement of the conversation. Both proved a 
 promise to give more than was due, and to pay extra for what one was 
 already legally bound to perform. The employer, therefore, received 
 no consideration for his promise to give the additional money at the 
 end of the year. Morgan had agreed to work for 12 months at the 
 price promised, and if during the term he had agreed to receive less, 
 the employer would still have been liable to pay him the full $40 per 
 month." On the other hand, the employer could not be forced to 
 pay more than the contract price. He got no more services that he 
 had already contracted to receive, and according to an almost un- 
 broken line of decisions the agreement to give more than was due was 
 a nudum pactum, and void, as having no consideration to support the 
 promise. The case is something like that of Bush v. Rawlins, 89 
 Ga. 117, 14 S. E. 886, where the landlord agreed to give the tenant 
 certain property if he would pay his rent promptly; and it was held 
 
 7= In accord: Indiana Veneer & Lumber Co. v. Hageman, 57 Ind. App. 668, 
 105 N. E. 253 (1914) ; Grath v. Mound City Eooflng Tile Co., 121 Mo. App. 245, 
 98 S. W. 812 (1907). 
 
Sec- 5) PERFORMANCE OF PRE-EXISTING LEGAL DUTY 345 
 
 that such a promise was a gratuity, and void, as without consideration 
 to support it. And see Tatum v. Morgan, 108 Ga. 336, 33 S. E. 
 940(2) ; Civ. Code 1895, § 3735. It is also within the principle of 
 Stilk V. Myrick, 2 Campbell, 317, where Lord Ellenborough held that 
 an agreement to pay, seamen extra for what they were bound by their 
 articles to do was void. And so in Bartlett v. Wyman, 14 Johns. 260, 
 a similar ruling was made in a case where a master agreed to give 
 more wages if the seamen would not abandon the ship. See, also, 
 Ayres v. C. R. I. Ry. Co., 52 Iowa, 478, 3 N. W. 522. There are 
 cases holding that a new promise is binding where one of the parties 
 to a contract refuses to perform, and, to save a loss, the innocent , par- 
 ty agrees to pay more than the original contract price, if the actor 
 will perform as originally agreed. Goebel v. Linn, 47 Mich. 489, UN. 
 W. 284, 41 Am. Rep. 723. But even if that line of cases should not 
 be disregarded as tending to encourage a breach of contract, they do 
 not affect the rights of Morgan here, because he does not bring him- 
 self within their ruling. Had there been a rescission or formal can- 
 cellation (Vanderbilt v. Schreyer, 91 N. Y. 402) of the old contract 
 by mutual consent, and if a new contract with new terms had been 
 made; or if there had been any change in the hours, services, or char- 
 acter of work, or other consideration to support the promise to pay the 
 increased wages it would have been enforceable. But, as it was, Mor- 
 gan proved that Davis promised to pay more for the performance 
 of the old contract than he had originally agreed. Such a promise 
 was not binding.'® * * * 
 Judgment reversed.'"' 
 
 TOThe court then discussed the sufficiency of moral obligation as a consid- 
 eration. 
 
 '■'In accord : McDonough v. Saunders, 201 Alabama, 321, 78 South. 160 
 (1918) ; Feldman v. Fox, 112 Ark. 223, 164 ^. W. 766 (1914) ; Main St. & A. P. 
 R. Co. V. Los Angeles Traction Co., 129 Cal. 301, 61 Pac. 937 (1900); Benford 
 V. Yockey, 63 Colo. 96, 164 Pae. 725 (1917) ; Goldsborough' v. Gable, 140 111. 
 269, 29 N. E. 722, 15 L. R. A. 294 (1892) ; Bunkle & Fouse v. Kettering, 127 
 Iowa, 6,102 N. W. 142 (1905) ; Tudor v. Security Trust Co., 163 Ky. 514,173 8. 
 W. 1118 (1915) ; Weseott V. Mitchell, 95 Me. 377, 50 Atl. 21 (1901) ; Bell v. 
 Dates, 97 Miss. 790, 53 South. 491 (1910) ; langenf elder v. Wainwright Brew- 
 ing Co., 103 Mo. 578, 15 S. W. 844 (1890) ; Weed v. Spears, 193 N. Y. 289, 86 
 N. E. 10 (1908) ; Hoskins v. Powder Land & Irr. Co., 90 Or. 217, 176 Pac. 124 
 (1918) ; Smith v. Brown, 50 Utah, 27, 165 Pac. 468 (1917) ; Creamery Package 
 Mfg. Co. V. Russell, 84 Vt. 80, 78 Atl. 718, 32 L. R. A. (N. S.) 135 (1911) ; 
 Jackson v. Cobbin, 8 M. & W. 790 (1841). And see further, note in L. B. A. 
 19I5B, 37 (vii). 
 
346 OONSIDBRATION (Ch. 2 
 
 MUNROE V. PERKINS. 
 
 (Supreme Judicial Court of Massachusetts, 1830. 9 Pick. 298, 20 Am. 
 
 Dee. 475.) 
 
 Indebitatus assumpsit for work done, materials found, money 
 paid, &c. brought against the defendant jointly with William Payne, 
 who died after the action was commenced. 
 
 At the trial before the chief justice it appeared, that in 1821 the 
 plaintifif was employed by Perkins and Payne to build a hotel at Na- 
 hant, which was begun in that year and finished in 1823. 
 
 The general defence was that, there was a special contract, and that 
 the work had been paid for according to the terms of that contract. 
 
 For the purposes of this case it was admitted, that the amount of 
 expenditures made and incurred by the plaintifif in and about the work, 
 exceeded the amount of the payments made to him. 
 
 It appeared that in 1821, a number of persons associated them- 
 selves for the purpose of erecting a hotel at Nahant, and subscribed 
 certain sums of money therefor; that Perkins and Payne were sub- 
 scribers and were the agents of the association, which was to be in- 
 corporated as soon as possible, and which was incorporated accord- 
 ingly in February, 1822. 
 
 The defendant offered in evidence an agreement under seal, dated 
 October 24, 1821, wherein the plaintiff engages to build the hotel ac- 
 cording to a certain drawing and description, and the defendant and 
 Payne, in behalf of their associates, agree to pay the plaintiff therefor 
 $14,500 as the work advances. 
 
 T. W. Sumner, a witness called by the defendant, testified that the 
 work was executed upon the basis of the drawing and description re- 
 ferred to in the sealed contract ; ' that there were some deviations, 
 consisting of additional work; that this was considered as extra 
 work, not included in the contract, and was paid for separately accord- 
 ing to its full cost and value. 
 
 To prove a waiver of the special contract, the plaintiff introduced 
 several witnesses. J. Alley testified, that in 1825 he said to the defend- 
 ant, it was a pity Munroe had undertaken to build the hotel ; to which 
 the defendant replied, that Munroe would not lose any thing by it, 
 and that they had agreed to pay him for every minute's work and for 
 all he had purchased. J. Mudge testiified, that in the spring of 1823 
 the plaintiff was indebted to the Lynn bank on a' note for $1,100, 
 which he wished to have renewed, but that the directors were not sat- 
 isfied of his solvency; that in April of that year, the plaintiff came to 
 the bank with Payne, who said he was the agent who attended to the 
 business of the Nahant hotel in the absence of Perkins, who had gone to 
 Europe; that he wanted to get from the bank some indulgence to- 
 wards the plaintiff; that the corporation would leave the plaintiff as 
 good as they found him; they would pay Munroe for all he should 
 
Sec. 5) PERFORMANCE OP PRE-EXISTING LEGAL DUTY 3^7 
 
 lay out; that Munroe should not stop for want of funds; that he 
 (Payne) knew Perkins's mind upon the subject; that the bills would 
 be paid, and the plaintiff should not suffer. W. Johnson testified, that 
 on the strength of this representation of Payne, the bank renewed the 
 plaintiff's paper. W. Babb testified, that in Ma.f, 1822, the defendant 
 asked the plaintiff how he got on ; that the plaintiff said poorly enough ; 
 that the ciefendant told him he must persevere ; the plaintiff said he 
 could not without means ; and the defendant repeated, you muSt per- 
 severe, and added, you shall not suffer, we shall leave you as we found 
 you. 
 
 The defendant objected to this evidence, that it was insufficient in 
 law to set aside the special contract ; that it did not amount to a waiver 
 of the original contract, but so far as it proved any thing, it was evi- 
 dence of a new express promise, which was without consideration and 
 from which no implied assumpsit could be raised. Also, that the 
 conversation with Perkins at one time and with Payne at another, 
 were not joint promises and created no joint cause of action, but that 
 the liability, if there was any, was several. 
 
 A verdict was taken by consent, subject to the opinion of the court, 
 for plaintiff. 
 
 Per Curiam. The verdict of the jury has established the fact, if 
 the evidence was legally sufficient, that the defendant, together with 
 Payne, made the promise declared on. The defence set up was, that 
 the work was done and the materials were furnished on a special con- 
 tract under seal, made by the defendant and Payne on behalf of them- 
 selves and other subscribers to the hotel; and such a contract was 
 produced in evidence. The main question is, whether, there being this 
 contract under seal, for a stipulated sum, an action lies on a general 
 assumpsit for the amount which the building actually cost; which is 
 more than the sum specified in the contract. It is said on the part of 
 the plaintiff, that having made a losing bargain and being unwilling and 
 unable to go on with the work, Perkins and Payne assured him that 
 he should not suffer; and that. the work was carried on and finished 
 upon their engagement and promise that he should have a reasonable 
 compensation without regard to the special contract. This engage- 
 ment is to be considered as proved, if by law it was admissible to 
 show a waiver of a special contract. 
 
 It is objected, that as the evidence was parol, it is insufficient in 
 law to defeat or avoid the special contract ; and many authorities have 
 been cited, to show that a sealed contract cannot be avoided or waived 
 but by an instrument of a like nature; or generally, that a contract 
 under seal cannot be avoided or altered or explained by parol evidence. 
 That this is the general doctrine of the law cannot be disputed. It 
 seems to have emanated from the common maxim, "Unumquodque dis- 
 solvitur eo ligamine quo ligatur." But like other maxims, this has 
 received qualifications, and indeed was never true to the letter, for at all 
 
348 CONSIDERATION (Ch.'2 
 
 times, a bond, covenant or other sealed instrument rnight be defeated 
 by parol evidence of payment, accord and satisfaction, &c. 
 
 It is a general principle, that where there is an agreement in writ- 
 ing, it merges all previous conversations and parol agreements; but 
 there are many cases in which a new parol contract has been admitted 
 to be proved. And though when the suit is upon the written contract 
 itself, it has been held that parol evidence should not be received, yet 
 when the suit has been brought on the gi^ound of a new subsequent 
 agreement not in writing, parol evidence has been admitted. 
 
 In Ratcliff v. Pemberton, 1 Esp. 35, Lord Kenyon decided, that to 
 an action of covenant on a charter-party, for the demurrage which 
 was stipulated in it, the defendant might plead that the covenantee, 
 who was the master and owner of the ship, verbally permitted the de- 
 lay, and agreed not to exact any demurrage, but waived all claim to it. 
 He laid down a similar rule in Thresh v. Rake, Id., 53 ; where how- 
 ever the contract does not appear to have been under seal. 
 
 In 2 Term R. 483, there were articles of partnership, containing a 
 covenant to account at certain times ; and upon a balance being struck, 
 the defendant promised to pay the amount of the balance; it was 
 held that assumpsit would lie upon this promise. 
 
 The case of Lattimore v. Harsen, 14 Johns. (N. Y.) 330, corner 
 nearer the case at bar. There the plaintiffs had agreed to perform 
 certain work for a stipulated sum of money, under a penalty. After 
 they had entered upon the performance of it, they determined to leave 
 off, and the defendant, by parol, released them from their covenant,, 
 and promised them, if they would complete the work, that he would pay 
 them by the day. The court held, that if the plaintiffs chose to incur the 
 penalty, they had a right to do so, and that the new contract was bind- 
 ing on the defendant. 
 
 In Dearborn v. Cross, 7 Cow. (N. Y.) 48, it is held, that a bond or 
 other specialty may be discharged or released by a parol agreement be- 
 tween the parties, especially where the parol agreement is executed; 
 and the case of Lattimore v. Harsen is there cited and relied on. 
 
 There are other decisions of like nature in the same court; as 
 Fleming v. Gilbert, 3 Johns. (N. Y.) 528; Keating v. Price, 1 Johns. 
 Cas. (N. Y.) 22, 1 Am. Dec. 92 ; Erwin v. Saunders, 1 Cow. (N. Y.) 
 250, 13 Am. Dec. 520. In Ballard v. Walker, 3 Johns. Cas. (N. Y.) 64, 
 it was held that the lapse of time between the making of the contract 
 and the attempt to enforce it, was a waiver; which is going further 
 than is necessary in the case before us, for here there is an express 
 waiver. 
 
 In Le Pevre v. Le Fevre, 4 Serg. & R. (Pa.) 241, 8 Am. Dec. 696, 
 parol evidence was admitted to prove an alteration of the course of 
 an aqueduct established by deed^ In regard to the objection, that 
 this evidence was in direct contradiction to the deed, Duncan, J. re- 
 marks, that "the evidence was not offered for that purpose, but to show 
 
Sec. 5) PERFORMANCE OP PRE-EXISTING LEGAI^ DUTY 349 
 
 a substitution of another spot. If this had not been carried into er- 
 fect, the evidence would not have been admissible; but where the 
 situation of the parties is altered, by acting- upon the new agreement, 
 the evidence is proper ; for a party may be admitted to prove by parol 
 evidence, that after signing a written agreement, the parties made a 
 verbal agreement, varying the former, provided their variations have 
 been acted upon, and the original agreement can no longer be enforced 
 without a fraud on one party." 
 
 The distinction taken "in the argument, between contracts in writing 
 merely and contracts under seal, appears by these authorities not to be 
 important as it respects the point under consideration, and justice re- 
 quired in the present case, that the parol evidence should be received. 
 
 It was said that the promise of Payne cannot affect Perkins, and vice 
 versa. But as they were joint actors, and as when one acted in the 
 absence of the other, it was always with a joint view to the same ob- 
 ject, they cannot be separated, but must be considered as joint prom- 
 isors. 
 
 The parol promise, it is contended, was without consideration. This 
 depends entirely on the question, whether the first contract was waived. 
 The plaintiff having refused to perform that contract, as he might do, 
 subjecting himself to such damages as the other parties might show 
 they were entitled to recover, he afterward went on upon the faith 
 of the new promise and finished the work. This was a sufficient con- 
 sideration. If Payne and Perkins were willing to accept his relinquish- 
 ment of the old contract and proceed on a new agreement, the law, we 
 think, would not prevent it. 
 
 Motion for new trial overruled.'^ 
 
 7 8 In accord: Rogers v. Rogers, 139 Mass. 440, 1 N. E. 122 (1885); Coyner, 
 V. Lynde, 10 Ind. 282 (1858); Lattimore v. Harsen, 14 Johns. (N. Y.) 330 
 (1817) ; Goebel v. Linn, 47 Mich. 489, 11 N. W. 284, 41 Am. Rep. 723 (1882) ; 
 Scanlon v. Northwood, 147 Mich. 139, 110 N. W. 493 (1907) ; John King Co. v. 
 Louisville & N. R. Co., 131 Ky. 46, 114 S. W. 308 (1908) ; Evans v. Oregon & 
 W. R. Co., 58 Wash. 429, 108 Pac. 1095, 28 L. R. A. (N. S.) 455 (1910) ; McCabe 
 Const. Co. V. Utah Const. Co. (D. C.) 199 Fed. 976 (1912) ; Flight v. Orasden, 
 Cro. Car. 8 (1625). But cf. Widiman v. Brown, 83 Mich. 241, 47 N. W. 231 
 (1890); Vanderbilt v. Schreyer, 91 N. Y. 392' (1883). And in Parrot v. Mexi- 
 can Cent. R. Co., 207 Mass. 184, 194, 93 N. E. 590, 34 L. R. A. (N. S.) 261 
 ,(1911), the court, after accepting the rule in Munroe v. Perkins, said: "While 
 it is well established in Massachusetts, the doctrine should not be extended 
 beyond the cases to which it is applicable upon the recognized reasons that 
 have been given for it;" and it was held to be inapplicable where there had 
 been no threat of breach by the plaintiff and no agreement of rescission by- 
 the defendant. To the same effect is Wescott v. Mitchell, 95 Me. 377, 50 Atl. 
 21 (1901). 
 
350 CONSIDERATION (Ch. 2 
 
 LINZ v.SCHUCK. 
 
 (Court of Appeals of Maryland, 1907. 106 Md. 220, 67 Atl. 286, 11 L. R. A. 
 [N. S.] 789, 124 Am. St. Rep. 481, 14 Ann. Cas. 495.) 
 
 Action by Albinus Schuck against John Linz. From a judgment 
 for plaintiif, defendant appeals. Affirmed. 
 
 Boyd, J.'^' The appellee sued the appellant on the common counts 
 for a balance claimed to be due for work done and materials provided, 
 etc., under the following circumstances : The appellant owned a house 
 known as "No. 3038 Elliott street," at the corner of Canton street in 
 Baltimore City, which was built without a cellar, was not plastered 
 or partitioned oiT on the second story, and the rear was arranged for 
 a stable. The appellee entered into a contract in writing with the ap- 
 pellant which states : "Cellar to be dug under the entire store to the 
 partition wall between kitchen and store to a depth of 7 feet, and walls 
 to be underpinned with good hard brick laid in cement, * * * 
 cellar to be connected with, sewer and cemented" and provides for 
 work to be done in the kitchen, the second story of the house, and a 
 number of other things not necessary to mention. It concludes, "I 
 will do the work and furnish material for the sum of fifteen hundred 
 dollars ($1,500)." The paper was drawn in the shape of an estimate 
 or bid, but was accepted by the appellant, and the appellee identified it 
 as his contract. 
 
 The appellee began the work in April, 1903. He gave the contract 
 to build the cellar to a subcontractor who started to excavate. The 
 appellee thus described the conditions of the ground: "The house 
 stood on a hard crust about three feet thick, and the foundation of 
 that house didn't extend through that hard crust. It was built on that 
 crust, and the more we got through that the more we got into a 
 swamp like — the bottom of an old creek, black muddy stuff and soft 
 and they tried to dig and dig and it all ran into this place and finally 
 a big lump would cave off and fall in every now and then, and they 
 continued on that way to get a trench dug to connect the cellar with 
 the sewer so we thought we could drain the place a little." His fore- 
 man notified him that the house was cracking, and he then got lumber 
 and drove "lagging" in to hold the ground. He testified that he noti- 
 fied Mr. Preston, the building inspector of the city, who went there 
 with one of his assistants, that they "took sticks and shoved them 
 down in the ground about 14 feet deep, and that Mr. Linz was pres- 
 ent upon this occasion." He also said that Mr. Preston told him no 
 cellar could be made, and he should fill in what he had taken out, 
 and he stopped the work. He further testified that the appellant 
 called on him "oft' and on," and wanted to see "whether we couldn't 
 make a cellar there; wouldn't it be possible in some way to over- 
 come it even if a small cellar." They finally thought they "could 
 
 7 9 Parts of the opinion are omitted. 
 
Sec. 5) PEBFOEMANCE OP PRE-EXISTING LEGAL DUTY 351 
 
 make a little cellar to get some cellar there," and he said: "Let 
 tlie thing lay, and we will drain the ground into the sewer, and 
 maybe we can overcome it, provided you pay the additional cost and 
 stand the consequences." He demanded a 'writing from the appellant, 
 and he said "his word was as good as mine, and if I put a cellar there 
 he would see I got pay for it; that he would pay for the additional 
 work I was compelled to do to make a cellar." In another place he 
 stated : "He says if I was able to get a cellar under there he would 
 reimburse or pay me the additional cost, whatever it was to get a cel- 
 lar there ; that the house was no good to him without a cellar." In 
 October we went to work again, dug out eight feet, then drove poles 
 down eight feet long, used "concrete and cement in there to form our 
 footing," and went to great expense and trouble to make the cellar, 
 under the new arrangement. 
 
 The appellant introduced evidence which tended to show ,that some 
 of the trouble about the cellar was owing to the negligent way in 
 which the appellee's men did the work, and that the bad condition of 
 the soil did not extend as deep as the appellee said it was, but there 
 can be" no doubt that the conditions were altogether different from 
 what appeared upon the surface or what was anticipated. The ap- 
 pellee also testified that before he made the ofifer he "wanted to know 
 how the ground was, and defendant took plaintiff in the cellar of his 
 building" (which was on the opposite side of the street), "and he show- 
 ed me he had a cellar dug there and it went all right, and the soil was 
 nice and sound there on the other corner, and when I started I 
 wouldn't have any trouble, and I made my figures on his say so." 
 After the work was begun the owner of the adjoining prf)perty sued 
 the appellant and the appellee for damages to her house sustained by 
 reason of the excavation, and the suit was compromised by the ap- 
 pellant buying the house, and the appellee agreeing to put it in proper 
 condition. That was No. 3036 Elliott street. 
 
 The principal question in the case is whether the plaintiff was en- 
 titled to recover for the additional costs and expenses incurred, by rea- 
 son of those conditions, on the promise of the appellant to pay him 
 for them. The precise question for our cc'nsideration is presented by 
 the plaintiff's fifth prayer, which was granted. After referring to the 
 written contract made in April or May, 1903, and the refusal of the 
 plaintiff in June, 1903, to perform and complete said contract the 
 prayer further submitted to the jury to find whether "said refusal on 
 the part of the plaintiff was induced by substantial and unforeseen 
 difficulties in the performance, which would cast upon the plaintiff 
 additional burden not anticipated by the parties when the coritract was 
 made, and if they further find that after said refusal by the plaintiff 
 the defendant, to induce the plaintiff to resume the work thus aban- 
 doned, promised him to see him through and to stand the consequenc- 
 es and that, relying upon said promise, the plaintiff completed the 
 work then their verdict may be for the plaintiff," etc. That prayer 
 
352 CONSIDERATION (Ch. 2 
 
 seems to have followed quite closely the language used in King v. Du- 
 luth, M. & N. Ry. Co., 61 Minn. 487,- 63 N. W. 1105, which case, not- 
 withstanding unfavorable criticisms by some writers, in our opihion, 
 announces a principle which is not only just and equitable, but is easi- 
 ly reconcilable with the general rule that a promise to do, or actually 
 doing, that which a party to a contract is already under legal obliga- 
 tion to do, is not a valid consideration to support the promise of the 
 other party to the contract to pay additional compensation for such 
 perJ^ormance. In King v. Duluth, after stating that general rule, it is 
 added : "In other words, a promise by one party to a subsisting con- 
 tract to the opposite party to prevent a breach of the contract on his 
 part is without consideration." The court then cited Ayers v. Railroad 
 Co., 52 Iowa, 478, 3 N. W. 522, Lingenfelder v. Brewing Co., 103 Mo. 
 578, 15 S. W. 844, Vanderbilt v. Schreyer, 91 N. Y. 392, and other cas- 
 es, most of which are among those relied on by the appellant as sus- 
 taining and illustrating the general rule which the Supreme Court of 
 Minnesota unhesitatingly and emphatically approved of. Indeed ' the 
 court said that the doctrine of Munroe v. Perkins, 9 Pick. (Mass.) 305 ; 
 Goebel V. Linn, 47 Mich. 489, 11 N. W. 284, 41 Am. Rep. 723; Rog- 
 ers V. Rogers, 139 Mass. 440, 1 N. E. 122; Byrant v. Lord, 19 Minn. 
 396 (Gil. 342), and Moore v. Locomotive Works, 14 Mich. ;266, as it is 
 frequently applied, did not commend itself to their judgment or sense 
 of justice. 
 
 Those are some of a number of cases which have sustained actions 
 for additional compensation on various theories — gome on the ground 
 of waiver, others on the ground that the party for whom the work was 
 done had the election of suing the other party for damages for breach 
 of contract or to make a new contract, and others that it was a modifi^ 
 cation of the original contract, etc. Chief Justice Start of the Minne- 
 sota court, in the course of the opinion, said : "It is entirely competent 
 for the parties to a contract to modify or waive their rights under it 
 and ingraft new terms upon it, and in such a case the promise of one 
 party is the consideration for that of the other ; but, where the prom- 
 ise to the one is simply a repetition of a subsisting legal promise, there 
 can be no consideration for the promise of the other party, and there 
 is no warrant for inferring that the parties have voluntarily rescinded 
 or modified their contract. But, where the party refusing to complete 
 his contract does so by reason of some unforeseen and substantial diffi- 
 culties in the performance of the contract, which were not known or 
 anticipated by the parties when the contract was entered into, and 
 which cast upon him an additional burden not contemplated by the par- 
 ties, and the opposite party promises him extra pay or benefits if he 
 vvill complete his contract, and he so promises, the promise to pay is 
 supported by a valid consideration. In such a case the natural infer- 
 ence arising from the transaction, if unmodified by any equitable con- 
 siderations, is rebutted, and the presumption arises that by the volun- 
 tary and mutual promises of the parties their respective rights and ob- 
 
Sec. 5) PERFORMANCE OF PRE-EXISTING LEGAL DUTY 353 
 
 ligations under the original contract are waived, and those of the new 
 or modified contract substituted for them. Cases of this character form 
 an exception to the general rule," etc. The opinion then goes on to say 
 that on the other hand, when there are no unforeseen additional bur- 
 dens which make the refusal to perform, unless promised further pay, 
 equitable, and such refusal and promise of extra pay are one transac- 
 tion the promise is without consideration and the case is within the 
 general rule. It then holds that what unforeseen difficulties and bur- 
 dens will make the refusal to perform equitable, so as to bring it with- 
 in the exception to the general rule, must depend upon the facts of 
 each particular case. 
 
 We have thus referred to, and quoted from, that cAse at unusual 
 length, because the principles therein announced seem to us to be, not 
 only well and clearly stated, but just, and founded on reasons that any 
 court of justice should hesitate to reject, unless they conflict with 
 some binding authority or established rule of law, which, in our judg- 
 ment, they do not. When two parties make a contract, based on sup- 
 posed facts which they afterwards ascertain to be incorrect, and which 
 would not have been entered into by the one party if he had known the 
 actual conditions which the contract required him to meet, not only 
 courts of justice but all right thinking people must believe the fair 
 course for the other party to the contract to pursue is either to relieve 
 the contractor of going on with his contract or to pay him additional 
 compensation. If the difficulties be unforeseen, and such as neither 
 party contemplated, or could have from the appearance of the thing to 
 be dealt with anticipated, it would be an extremely harsh rule of law to 
 hold that there was no legal way of binding the owner of property to 
 fulfill a promise made by him to pay the contractor such additional sum 
 as such unforeseen difficulties cost him. But we do not understand the 
 authorities to sustain such a rule. On the contrary they hold that the 
 parties can rescind the original contract, and then enter into a new 
 one, by which a larger consideration for the same work and materials 
 that were to be done and furnished under the first contract can be val- 
 idly agreed-upon. * * * 
 
 We are, however, of the opinion that this prayer can be sustained on 
 the ground stated in' King v. Duluth, etc., Ry. Co., supra, and other 
 cases, which is, as expressed in that case, that "by the voluntary and 
 mutual promises of the parties their respective ^rights and obligations 
 under the original contract are waived, and those of the new or modi- 
 fied contract substituted for them." When there is such a strong mor- 
 al obligation as there was in this case to give the appellee relief, it 
 would be making an exceedingly technical distinction to hold that the 
 promise would have been binding if the original contract would have 
 been expressly rescinded, but that it is not binding because there was 
 no express or actual rescission, although the facts show that it was un- 
 doubtedly intended by the parties that neither should be held to the 
 terms of the original contract. Of course it will be borne in mind that 
 
 COEBIN CONT 23 
 
354 CONSIDERATION (Ch. 2 
 
 the court in King v. Duluth, etc., Ry. Co., only applied the principle 
 announced to cases wherte the refusal to perform was equitable and 
 fair, and the difficulties were substantial, unforeseen, and not within 
 the contemplation of the parties when the original contract was made. 
 The opinion also excluded from the application of the principle mere 
 "inadequacy of the contract price which is the result of an error of 
 judgment, and not of some excusable mistake of fact." * * * 
 Judgment affirmed. *" ' 
 
 SCHWARTZREICH v. BAUMAN-BASCH, Inc. 
 
 (Supreme Court of New York, Appellate Tenn, 1918. 105 Misc. Rep. 214, 172 
 
 N. y. Supp. 683.) 
 
 Appeal by plaintiff from an order and judgment of the City Court of 
 the City of New York respectively setting aside the verdict of 
 a jury and dismissing the complaint. 
 
 BijUR, J. Plaintiff, an employee, sued his employer, the defendant, 
 for breach of a written contract of employment, made October 17, 
 1917, to continue for twelve months, beginning November 22, under 
 which plaintiff was to receive a salary of $100 per week. It appeared 
 on the trial that on August 31, 1917, a written contract in all respects 
 identical with the one sued upon had been made between the parties, 
 except that the weekly salary was therein fixed at $90. 
 
 The trial was conducted with great care and exactness by both court 
 and counsel, and the court in charging the jury repeatedly impressed 
 upon it that "the test question is whether by word or by act, either 
 prior to or at the time of the signing of the $100 contract, these par- 
 ties mutually agreed that the old contract from that instant should be 
 null and void." 
 
 The jury having brought in a verdict in favor of the plaintiff, the 
 court, upon a motion of the defendant to set the verdict aside, "par- 
 ticularly on the ground that there is no evidence in the case of mutual 
 consent or agreement to cancel the first contract at the time or prior 
 to the execution of the second contract," ultimately granted the motion 
 and dismissed the complaint under a reservation of power made at 
 the trial, saying "that there was not sufficient evidence that the first 
 
 80 In accord: King v. Diiluth, M. & N. Ey. Co., 61 Minn. 482, 63 N. W. 1105 
 (1895) ; Osborne v. O'Reilly, 42 N. J. Eq. 467, 9 Atl. 209 (1887). 
 
 Where there is unexpected difficulty or expense, due to the conduct of the 
 defendant himself, or where the work done by the plaintiff was changed in 
 its character, location, or amount by the defendant, there is ample consider- 
 ation for the new promise to pay increased compensation. United Steel Co. 
 v. Casey (C. C. A.) 262 Fed. 889 (1920). There the court further said: "Where 
 a contract must be i)erformed under burdensome conditions not anticipate^, 
 and not within the contemplation of the parties at the time the contract was 
 made, and the promisee measures up to the right standard of honesty and 
 fair dealing, and [the promisor] agrees, in view of the changed conditions, to 
 pay what is then reasonable, .lust, and fair, such new contract is not without 
 consideration within the meaning of that term, either in law or in equity." 
 
Sec. 5) PERFORMANCE OF PRE-EXISTING LEGAL DUTT 355 
 
 contract was canceleid upon 'the making of the second one to warrant 
 the jury's, finding." 
 
 The contending parties agree fairly well on the substantiYC law 
 applicable to the case. It is conceded that "a promise by one party 
 to do that which he is already under a legal obligation to perform ts 
 insufficient as a consideration to support a contract." Carpenter v. 
 Taylor, 164 N. Y. 171, 177, 58 N. E. 53; Robinson v. Jewett, 116 
 N. Y. 40, 22 N. E. 224; Seybolt v. N. Y., L. E. & W. R. R., 95 N. 
 Y. 562, 47 Am. Rep. 75 ; Vanderbik v. Schreyer, 91 N. Y. 392. It is 
 true that appellant urges that the mere making of a subsequent agree- 
 ment covering the same subject matter necessarily supersedes a prior 
 agreement to the same effect (citing Housekeeper Pub. Co. v. Swift, 97 
 Fed. 290, 38 C. C. A. 187, and McCabe Const. Co. v. Utah Const. Co. 
 [D. C] 199 Fed. 976), but I cannot find in the opinions in those cases 
 that the question whether under such circumstances there is any con- 
 sideration for the second contract was raised or suggested. The 
 principle itself is too well established to be questioned. It has been ap- 
 plied to a case of an increase of salary sirnilar to the one under con- 
 sideration in Cosgray v. N. E. Piano Co., 10 App. Div. 351, 41 N. Y. 
 Supp. 886. 
 
 On the other hand, in a leading case in this state (Vanderbilt v. 
 Schreyer, supra, 91 N. Y. 392), it is said on page 402: "It would 
 doubtless be competent for parties to cancel an existing contract and 
 make a new one to complete the same work at a different rate of 
 compensation, but it seems that it would be essential to its validity that 
 there should be a valid cancellation of the original contract. Such was 
 the case of Lattimore v. Harsen, 14 John. 330."' To the same effect is 
 Stewart v. Keteltas, 36 N. Y. 388; Hart v. Lauman, 29 Barb. 410, 415, 
 416. And the question whether the earlier agreement had been can- 
 celed was expressly submitted to the jury and answered in the negative 
 in Harris v. Carter, 3 El. & Bl. 559. 
 
 It is not necessary, as I view it, in the instant case to determine 
 whether in 'order to sustain the second agreement the cancellation of 
 the first must have taken place before the second was phy.sjcally signed. 
 My own opinion is that the time of signing the second contract is in 
 this connection immaterial. A written agreement in order to become 
 effective must be "deUvered." The delivery may be informal and 
 inartificial, provided the intent is sufficiently demonstrated. Dietz v. 
 Farish, 79 N. Y. 520; Sarasohn v. Kamaiky, 193 N. Y. 203, 215, 86 
 N. E. 20. Similarly, the cancellation or, as it is sometimes called, the . 
 "rescission," of an agreement may be evidenced by implication quite 
 as effectively as by express words. Hart v. Lauman, supra. And 
 whether it has taken place may be determined by all the circumstances 
 in evidence which affect it. Matter of Ch,amberlain, 146 App. Div. 
 583, 131 N. Y.Supp. 245, affirmed 204 N. Y. 665, 97 N. E. 1103. 
 
 It seems to me, therefore, that if after the second agreement had 
 actually ,b(;en signed the parties had canceled the earlier one, and the 
 
356 CONSIDERATION (Ch. 2 
 
 circumstances indicated the intent to redeliver or make effective the 
 second agreement, there is np reason why that result might not validly 
 be achieved. This nice question, however; need not be decided in the 
 instant case, for, as I read the record, there was evidence upon which 
 the jury might properly have based its finding that it was the intention 
 of the parties to and that, they actually did cancel the first contract 
 before the execution of the second agreement. 
 
 Plaintiff testified that he delivered the earlier contract to defendant's 
 president Bauman, at the time of the signing of the later one, and 
 Bauman said to him, "You do not want this contract any more because 
 the new one takes its place." Bauman testified that the first contract 
 was not handed to him at the signing of the second contract, but that 
 plaintiff tore off the signatures to the old contract in his presence, 
 to which he made no objection, and that this was done "after I gave 
 him the new contract; he tore the signatures off." As defendant- 
 respondent interprets this testimony: "According to the plaintiff's 
 version, after the second contract was signed plaintiff offered to 
 Mr. Bauman his copy of the first contract, and Mr. Bauman refused 
 to accept it. According to defendant's version, after the contract 
 was signed plaintiff offered Mr. Bauman his copy of the first contract; 
 he refused to accept it, and thereupon plaintiff tore off the signatures 
 at the bottom of his copy. Upon neither version of this occurrence 
 can an agreement binding on the defendant be spelled out to cancel 
 and rescind the first contract." 
 
 There might be some force in this contention if it could be success- 
 fully maintained that the only way to cancel an agreement was to 
 return to the respective signatories the duplicates thereof, or to tear 
 off the signatures, or even if such cancellation could be evidenced by 
 those circumstances alone. The mere statement of the proposition, 
 however, suffices for its own refutation. The question submitted 
 to the jury was, "Did the parties prior to the signing of the second 
 agreement cancel the first ? " It is conceded that the second agreement 
 was drawn up by the defendant's president in the plaintiff's presence 
 and was thereupon signed by both parties. Bauman testified: 
 
 "Q. And was it your understanding at the time that you signed the 
 paper and gave him one copy of it that you were giving him a contract 
 for the year ending November, 1918 (the same term as was covered 
 by the prior agreement) ? A. That is right. Q. Did you receive any 
 other paper at that time? A. No, sir. Q. Now, are you positive about 
 that? A. Positive. Q. Didn't you say to Mr. Schwartzreich (plain- 
 tiff) at that time that he should give you a paper that you had signed 
 before? A. I did. Q. Did he give it to you? A. Not at that time 
 * * * Later he gave it to me. 
 
 "The Court: Q. Was that contract of August? 
 
 "Plaintiff's Counsel : A. That was the contract of August." 
 
 The testimony of Bauman that at the time of execution of the sec- 
 ond contract he demanded from plaintiff the surrender of plaintiff's 
 
Sec. 5) PEEFOEMANCE OP PEE-EXISTING LEGAL DUTY 357 
 
 copy of the old agreement is not explained upon, and cannot be recon- 
 ciled with any other theory than that Bauman understood that the 
 parties had previously agreed that the first contract be canceled. I 
 am, indeed, inclined to believe that this evidence is well ni^h conclu- 
 sive to that effect, but in any event it furnished, together with the 
 balance of the testimony, ample ground for the finding of the jury, 
 which I also think was correct. 
 
 The order setting aside the verdict and the judgment dismissing the 
 complaint should be reversed and the verdict and judgment reinstated, 
 with costs to appellant. 
 
 MuLLAN, J. (dissenting):. Of course it goes without saying that the 
 parties could have canceled the old contract and subsequently have 
 made a new one. It is equally plain that they observed the formalities 
 usual in making a contract, that is to say, they performed all the nec- 
 essary gestures and gave promise for promise, and made what would 
 have been, except for the rule of law under discussion, the clearest 
 example of a good contract. But were the parties capable, at the time, 
 of making that particular contract? The answer to that question de- 
 pends upon the answer to the primary question, whether, when the sec- 
 ond contract was made, the first contract was at an end. 
 
 A true cancellation of a contract leaves the parties to it in statu 
 quo ante ; that is, it leaves them in the same situation in respect of the 
 subject-matter of the canceled contract as if they had never seen 
 or heard of each other. An agreement to cancel a contract is itself 
 just as truly a contract as the contract it terminates, and its effect 
 is to put an end to the contract not merely that the contractors may 
 thereby be enabled to enter into a new contract with each other, but 
 to leave them in perfect freedom to refuse to enter into any further con- 
 tractual relationship with each other. Now, it may be theoretically 
 possible for parties to a contract genuinely to terminate it by agree- 
 ment, thereby intending; to be free to refuse to deal with each other 
 again, and then -immediately and genuinely to change their minds 
 and remake the contract that was canceled, with a change of terms in 
 favor of one party only. It is more reasonable, however, to ass#ne 
 that at least some few moments must elapse between the time when 
 two given mipds shall agfee to cancel an existing contract and the 
 time when those same two minds shall decide to reinstate it or again 
 make one very like it. In the world of the realities lightning fast 
 changes of the kind that must have taken place to make the second 
 contract good do not occur, and I feel quite safe in saying dogmatically 
 that no such sudden revulsion occurred here ; nor indeed do I under- 
 stand that such an absurdity is claimed. Can it be seriously urged that 
 the defendant was willing that the plaintiff should have any moment 
 of freedom from the old contract — such freedom I mean as to give 
 the plaintiff the right to seek employment from some one other than 
 the defendant? I think it is very clear that the parties never intended 
 
858 CONSIDBEATION (Ch. 2 
 
 to be free from each other, and that the new contract was a mere sub' 
 stitutfon for the old one, and that is precisely what the rule that refuses 
 validity to a promise to pay more for what the promisee has already 
 obligated to do was intended to prevent. 
 
 There is nothing in this case that distinguishes it from the many 
 cases in the books in which the ancient rule of law referred to was ap- 
 plied. The tearing up of one writing and the delivery of another 
 writing in its stead are unimportant evidentiary details. Whenever 
 the question of the rule's applicability has arisen one contract has been 
 in legal effect destroyed and another contract, valid but for the rule, 
 has been substituted for it. Quite obviously, the physical tearing of a 
 piece of paper accomplishes nothing more than does an oral agreement 
 to cancel ; and I see no importance in the particular chronological order 
 in which the various physical gestures occurred. Indeed, it seems 
 to me that the entire argument of the appellant amounts to nothing 
 more than a mere magnification of the valueof immaterial details and 
 misses the real meaning and purpose of the doctrine we are dealing 
 with. That the courts have shown no disposition to authorize any 
 departure from the rule is shown in a comparatively recent case (Weed 
 V. Spears, 193 N. Y. 289, 86 N. E. 10), where it was said: 
 
 "Thus the only question presented in this case is whether a new 
 promise by a party to do less than he has already agreed to do is a 
 sufficient consideration for the promise of another party to do more 
 than he is obliged to do. It seems to me that the negative answer to 
 that question is so plain that there is no opportunity for doubt. 
 
 "Brief reference will be made to some of the arguments advanjjed in 
 behalf of the respondents in favor of a different answer. 
 
 "It is said that mutual promises are a consideration for an executory 
 agreement, and that the respondents having performed their executory 
 agreement it will be a perversion of the rules of law to permit the de- 
 fendant now to escape performance on his part. Of course there is 
 no doubt that under ordinary circumstances mutual promises are a con- 
 sideration one for the other, and such was undoubtedly the effect and 
 vaifee of the mutual promises of these parties contained in the original 
 written agreement. 
 
 "The trouble with the last mutual promises relied on by the respond- 
 ent is that they afford no consideration to the appellant when measured 
 by the obligations already resting upon the parties." 
 
 The view I take makes it unprofitable to discuss any of the cases 
 cited by my learned brother except Lattimore v. Harsen, 14 Johns. 
 330 and Harris v. Carter, 3 EL & Bl., 559. In the Lattimore case the 
 new contract that was held valid entirely changed the obligations of 
 both parties, and so, of course, the rule in question had no applicability. 
 It is true that in the English case the trial judge before making his de- 
 cision asked for a special verdict from the jury, but just what he ex- 
 pected them to pass upon I cannot conceive, for there, as here, there 
 
Sec. 5) PERFORMANCE OP PRE-EXISTING LEGAL DUTY 359 
 
 was no hiatus between the two engagements, only one party was advan- 
 taged by the change, and there was nothing to decide but a question of 
 law. For the reasons stated I vote to affirm. 
 
 Judgment and order reversed, with costs to appellant. 
 
 EVANS V. OREGON & W. R. CO. et al. 
 
 (Supreme Court of Washington, 1910. 58 Wash. 429, 108 Pac. 1095, 28 L. R. A. 
 
 [N. S.] 455.) 
 
 Action by J. S. Evans against the Oregon & Washington Railroad 
 Company and others. From a judgment for plaintiff against ' defend- 
 ants M. W. Dibble and another, they appeal. Affirmed. 
 
 GosE, J. Prior to August 12, 1907, the appellants entered into a con- 
 tract with the respondent Oregon & Washington Railroad Company 
 for grading a part of its roadbed in Lewis county. On that date the 
 appellants entered into a written contract with the respondent, Ev- 
 ans, by which they sublet to him a portion of the work. The respond- 
 ent, Evans, commenced work under his contract, but, finding that the 
 compensation Areed upon was inadequate, abandoned the work. The 
 following day, at the instance of the division engineer of the railroad 
 company, a Mr. Abbott, Evans and Abbott went to see the appellant 
 Dibble, and informed him that Evans was dissatisfied, and had quit 
 work. Evans then complained of the refusal of the appellants to 
 pay a certain bill, and further ^aid to them that he did not want to 
 resume work because he had struck gumbo, and could not make any- 
 thing. Abbott insisted that he should go on with the work, and stated 
 in Ihe presence of the appellant Dibble that, if he would continue and 
 complete the work, "we will see that the bills are paid and you get a 
 reasonable wage." Dibble was present, but said nothing further than 
 to discuss the bill. The respondent Evans then resumed and completed 
 the work, and, upon the refusal of the parties to pay a portion of the 
 bills and his wages, brought this suit against his corespondent and the 
 appellants to enforce the oral contract. At the close of his testimony, 
 a motion for a nonsuit was granted as to the railroad company and 
 deijiied as. to the appellants. There was a verdict, and judgment in 
 favor of the respondent Evans against the appellants, and they have 
 appealed.*^ 
 
 The first point suggested by the appellants is that the oral contract, 
 if made, was without consideration, and not enforceable. It is insisted 
 that neither the promise to do, nor the doing of that which the prom- 
 issor is by law or subsisting contract bound, to do, is a sufficient consid- 
 eration to support a contract in his favor. We cannot assent to this 
 view of the law. We think the better rule is that) where a party has 
 breached his contract and refused to perform it, it is optional with the 
 
 81 The court found that there was suflScient evidence that Dibble promised 
 to pay the extra sum to sustain the verdict. Part of the opinion is omitted. 
 
360 CONSIDERATION (Ch. 2 
 
 adverse party to sue him for damages or waive the breach, treat the 
 contract as abrogated, and enter into a new contract with the delinquent 
 party. It would seem to be, elementary that parties competent to con- 
 tract can abrogate or rescind the contract and enter into a new con- 
 tract touching the same svibject-matter to be performed, in the same or 
 a different way, upon a different consideration. In the case at bar the 
 appellants had contracted to do certain work, and it was important to 
 them that the work that Evans had agreed to perform should go 
 forward. When he abandoned the work, they had the election to 
 hold him answerable in damages or to make a new contract with him. 
 They chose the 'latter course, and cannot now be heard to say that 
 the contract was nudum pactum. 
 
 This position has abundant support in the authorities. "Where 
 the contractor refuses to perform his contract, and the builder prom- 
 ises to pay him additional compensation in consideration of the contin- 
 ued performance of the contract, the authorities are not in accord 
 on the question whether the promise for additional cornpensation is 
 supported by a sufficient consideration. The prevailing rule seems to 
 be, however, tha,t such a promise is valid as an abandonment of the 
 original contract and the creation of a new contract' 30 Am. & 
 Eng. Enc. Law (2d Ed.) p. 1197. * =f= * it must be conceded, 
 however, that the courts are not agreed upon this question, and judges 
 of the highest ability havp annoiinced the view urged by the appel- 
 lants. The view we have taken will permit greater freedom in con- 
 tracting, and is, we think, more in harmony with the fundamental con- 
 ception of contracts. * * * 
 
 The judgment is affirmed. 
 
 SHERWOOD V. WOODWARD. 
 (In the Queen's Bench, 1599. Cro. Eliz. 700.) 
 Assumpsit. Whereas he sold to the defendant's son certain weights 
 of cheese; the defendant, in consideration the plaintiff would deliver 
 the said cheese to his said son, assumed, that if the son did not pay 
 for them, then he would ; and for non-payment the action was brought. 
 Upon non assumpsit pleaded, and found for the plaintiff, it was moved 
 by Godfrey in arrest of judgment, that this was not any considera- 
 tion; for it is no more than what the law appoints, to deliver that 
 which he sold, the property whereof is in the son' by the sale.— But 
 Gawdy and Fenner held it to be a good consideration ; for it is an 
 ease to the bargainee to have them without suit, which peradventure 
 otherwise he could not have had. And although the bargainee may 
 take theni in this case, the bargainor is not bound to dehver them; 
 and there is a new kct done by him upon this agreement, and! it is an 
 ease to the vendee; and 12 Hen. VII is, that to deliver the goods of 
 the party himself at another place, is a good accord. Whereifore, 
 caeteris justitiariis absentibus, they adjudged it for the plaintiff. 
 
Sec. 5) PERFORMANCE OF PRE-EXISTING LEGAL DUTY 361 
 
 BAGGE V. SLADE. 
 (In the King's Bench, 1614. 3 BulSt. 162.) 
 
 In a writ of error to reverse a judgment given against him in an 
 action upon the case for a promise. In the town Court of Yevell, 
 in commitatu Sommerset. The error ' assigned and insisted upon was 
 this, because there wanted a good consideration to raise the promise, 
 and so no cause of action. 
 
 Coke, C. J. The case was this, two men were bound in a bond for 
 the debt of a third man ; the obligation being forfeited, so that they 
 both of them were liable to pay this. The plaintiff here in this writ 
 of error said to the other, "Pay you all the debt, and I will pay you 
 the moiety of this again," the which he paid ' accordingly, and so 
 made his request to have a repayment made to him of the moiety 
 according to his promise, which to do he refused. Upon this he 
 brought his action upon the case against the plaintiff upon his prom- 
 ise, and upon non assumpsit pleaded, he had a verdict and judgment, 
 and, upon this judgment a writ of error was brought. In this case and 
 in the declaration there is a good consideration set forth, the party's 
 own contract here shall bind him, he hath rio remedy for the money 
 paid, but when this is paid, here is good assumpsit grounded upon a 
 good consideration for repayment of the moiety by the plaintiff. 
 
 Haughton, J. Notwithstanding this contract he is still least in dan- 
 ger of the first bond. 
 
 Coke. I have never seen it otherwise, but wheri one draws money 
 from another that this should be a good consideration to raise a 
 promise. 
 
 DoDDERiDGE, J. If the consideration puts the other to charge, 
 though it be no ways at all profitable to him who made the promise, 
 yet this shall be a good consideration' to raise a promise. ; 
 
 CokE agreed with him herein, also if a man be bound to another by 
 a bill in £1,000 and he pays unto him £500 in discharge of this bill, 
 the 'which he accepts of accordingly, and doth upon this assume and 
 promise to deliver up unto him his said bill of il,000, this £500 is no 
 satisfaction of the £1,000, but yet this is good and sufficient to make 
 a good promise, and upon a good consideration, because he had paid 
 money, £500, and he had no remedy for' this again. 
 
 Another matter was moved, that the entry of the judgment was 
 not good, the same being in this manner, Ideo consideratum fuit, 
 adtunc, and ibidem hie ad eandem Curiam, quod prsedictus querens 
 recuperet. 
 
 The whole Court agreed this judgment to be well entered, and that 
 the consideration here is good, and sufficient to raise the promise, 
 aiid accordingly the rule of the Court was quod judicium affirmetur. 
 
 Judgment affirmed per curiam. ' 
 
362 OONSIDBEATION (Ch. 2 
 
 SHADWELL v. SHADWELIv. 
 (In the Court of Common Pleas, 1860. 30 L. J. C. P. 145.) 
 
 The declaration stated that the testator, in his lifetime (in consider- 
 ation that the plaintiff would marry Ellen Nicholl), agreed with and 
 promised the plaintiff, who was then unmarried, in the terms contained 
 in a writing in the form of a letter, addressed by the said testator 
 to the plaintiff, which writing was and is in the words, letters, and 
 figures following — that is to say : 
 
 Gray's Inn, August 11, 1838. 
 
 "My Dear Lancey: I am glad to hear of your intended marriage 
 with Ellen Nicholl ; and, as I promised to assist you at starting, I 
 am happy to tell you that I will pay to you £150 yearly during my 
 life, and until your annual income derived from your profession of a 
 Chancery barrister shall amount to 600 guineas, of which your own 
 admission will be the only evidence that I shall receive or require. 
 
 "Your ever affectionate uncle, Charles Shadwell." 
 
 Averment that the plaintiff did all things necessary, and all things 
 necessary happened,- to entitle him to have the said testator pay to 
 him eighteen of the said yearly sums of £150 each respectively, and 
 that the time for the payment of each of the said eighteen yearly 
 sums elapsed after he married the said Ellen Nicholl, and in the life- 
 time of the. said testator, and that the plaintiff's annual income de- 
 rived from his profession of a Chancery barrister never amounted to 
 600 guineas, which he was always ready and willing to admit and 
 state to the said testator, and the said testator paid to the plaintiff 
 twelve of the said eighteen yearly sums which first became payable, 
 and part, to wit, il2 of the thirteenth; yet the said testator made 
 default in paying the residue of the said thirteenth yearly sum, which 
 residue is still in arrear and unpaid, and in paying the five of the said 
 eighteen yearly sums which last became payable, and the said five 
 sums are still in arrear and unpaid. 
 
 Fourth plea, that before and at the time of the making of the Sup- 
 posed agreement and promise in the declaration mentioned, the said 
 marriage had been and was without any request by or on the part of 
 the testator touching the said intended marriage, but at the request 
 of the plaintiff, intended and agreed upon between the plaintiff and 
 the said Ellen Nicholl, of which the testator before and at the time 
 of making the supposed agreement and promise also had notice, and 
 the said marriage was after the making of the supposed agreement and 
 promise duly had and solemnized as in the declaration mentioned, 
 at the request of the plaintiff, and without the request of the testator. 
 And the defendants further say, that save and except as expressed 
 and contained in the writing set forth in the declaration, there never 
 was any consideration for the supposed agreement and promise in 
 the declaration mentioned, or for the performance thereof. 
 
Sec. 5) PEBFOEMANCE OF PRE-EXISTING LEGAL DUTY 363 
 
 Fifth plea, to part of the claim of the plaintiff, to wit, to so much 
 thereof as accrued due in and after the year 1855, the defendants say 
 that although the supposed agreement and promise in the declaration 
 mentioned were made upon the terms then agreed on by the plaintiff 
 and the testator, that the plaintiff should continue in practice and 
 carry on the profession of such Chancery barrister as aforesaid, and 
 should not abandon the same; yet that after the making of the said 
 agreement and promise, and before the accruing of the supposed 
 causes by this plea pleaded to and in the declaration mentioned, or 
 any part thereof, the plaintiff voluntarily, and without the leave or 
 license of the testator, relinquished and gave up and abandoned the 
 practice of the said profession of a Chancery barrister, which before 
 and at the time of the said making of the said supposed agreement and 
 promise, he had so carried on as aforesaid ; and although the plaintiff 
 could and might, during the time in this plea and in- the declaration 
 mentioned, have contintied to practice and carry on that profession 
 as aforesaid, yet the plaintiff, after such abandonment thereof, neVer 
 was ready and willing to practise the same as aforesaid, but practised 
 only as a revising barrister— ^that is to say, as a barrister appointed 
 yearly to revise the list of voters for the year, for the county of Mid- 
 dlesex, according to the provisions of the statutes in that behalf, by 
 holding open courts for such revision at the times and places in that 
 behalf provided by the said statutes. 
 
 Second replication to the fourth plea, that the said. agreement de- 
 clared on was made in writing, signed by the said testator, and was 
 and is in the words, letters, and figures following, and in none other — 
 that is to say [setting out the letter as in the declaration above]. 
 Averment that the plaintiff afterward married the said Ellen Nicholl, 
 relying on the said promise of the said testator, which at the time of 
 the said marriage was in full force, not in any way vacated or revoked 
 and that he so married while his annual income derived from his pro- 
 fession of a Chancery barrister did not amount, and was not by him 
 admitted to amount, to 600 guineas. 
 
 Second replication to the fifth plea, that the said agreement de- 
 clared on was in writing, signed by the testator, and was and is 
 in the words, letters, and figures set out in the next preceding replica- 
 tion, and in none other, and that the terms upon which it is in the 
 fifth plea alleged that the said agreement and promise were made 
 were no part of the agreement and promise declared on, and the per- 
 formance of them by the plaintiff was not a condition precedent to the 
 plaintiff's right to be paid the said annuity. 
 
 Demurrers to the replications to the fourth and fifth pleas. Joinder 
 in demurrer. • 
 
 ErlE, C. J., now delivered the judgment of himself and Keating, J. 
 The question raised by the demurrer to the replication to the fourth 
 plea is, whether there was a consideration to support the action on 
 the promise to pay an annuity of ilSO per annum. If there be such a 
 
364 CONSIDERATION (Ch. 2 
 
 consideration it is a marriage ; therefore the promise is within the Stat- 
 ute of Frauds, and the consideration must appear in the writing con- 
 taining the promise — that is, in the letter of August 11th, 1838 — and 
 in the surrounding circumstances to be gathered therefrom, together 
 with the averments on the record. The circumstances are that the 
 plain/tiff had made an engagement to marry Ellen NichoUi his uncle 
 promising him to assist him at starting, by which, as I understand the 
 words, he meant on commencing his married life. Then the letter 
 containing the promise declared on is said to specify what the assist- 
 ance would be — namely,, i ISO per annum during the uncle's life, and 
 until the plaintiff's professional income should be acknowledged by 
 him to exceed 600 guineas ; and a further averment, thaf the plaintiff, 
 relying upon his promise, without any revocation on the part of the 
 uncle, did marry Ellen NichoH. Then, do these facts show that the 
 promise was in consideration, either of the loss to be sustained by the 
 plaintiff, or the benefit to be derived from the plaintiff to the uncle at 
 his, the uncle's request? ' My answer is in the affirmative. First, do 
 these facts show a loss sustained by the plaintiff at the uncle's request ? 
 When I answer this in the affirmativp, I am aware that a man's 
 marriage with the woman of his choice is in one sense a boon, and in 
 that sense the reverse of a loss; yet, as between the plaintiff and the 
 party promising an income to support the marriage, it may be a loss. 
 The plaintiff may have made the most material changes in his position, 
 ahd have induced the object of his affections to do the same, and have 
 incurred pecuniary liabilities resulting in embarrassments, which 
 would be in every sense a loss if the income which had been promised 
 should be withheld; and if the promise was made in order to induce 
 the parties to marry, the promise so made would be, in legal effect, 
 a request to marry. Secondly, do these facts show a benefit derived 
 from the plaintiff to the uncle at his request? In answering again 
 in the affirmative, I am at liberty to consider the relation in which the 
 parties stood, and the interest in the status of the nephew which the 
 uncle declares. The marriage primarily affects the parties thereto; 
 but in the second degree it may be an object of interest with a near 
 relative, and jn that sense a benefit to him. This benefit is also de- 
 rived from the plaintiff at the uncle's request, if the promise of the 
 annuity was intended as an inducement to the marriage; and the 
 averment that the plaintiff, relying on the promise, married, is an 
 averment that the promise was one inducement to the marriage. This 
 is a consideration averred in the declaration, and it appears to me to 
 be expressed in the letter, construed with the surrounding circum- 
 stances. No case bearing a strong analogy to the present was cited, 
 but the importance of enforcing promises which have been made to 
 induce parties to marry has been often recognized, and the cases of 
 Montefiori v. Monteflori and Bold v. Hutchinson are examples. I 
 do not' feel it necessary to add anything about the numerous authorities 
 referred to in the learned arguments addressed to us, because the 
 
Sec. 5) PERFORMANCE OF PRE-EXISTING LEGAL DUTY 365 
 
 decision turns on a question of fact, whether the consideration for the. 
 promise is proved as pleaded. I think it is, and therefore my judgment 
 on the first demurrer is for the plaintiff. The second den^urrer raises 
 the question, whether the plaintiff's continuing at the bar was made 
 a condition precedent to the right to the annuity. I think not. The 
 uncle promises to continue the annuity until the professional income 
 exceeds the sum mentioned, and I find no stipulation that the annuity 
 shall cease if the professional diligence ceases. My judgment on this 
 demurrer is also for the plaintiff, and I should state cnat this is the 
 judgment of my Brother Keating and myself, my Brother ByliSs 
 differing with us. 
 
 BylES, J. I am of opinion that the defendant is entitled to the judg- 
 ment of the Court on the demurrer to the second replication to the 
 fourth plea. It is alleged by the fourth plea that the defendant's 
 testator never requested the plaintiff to enter into the engagement to 
 marry, or to marry, and that there never was any consideration for 
 the testator's promise, except what may be collected from the letter 
 itself set out in the declaration. The inquiry, therefore, narrows it- 
 self to this question. Does the letter itself disclose any consideration 
 for the promise? The consideration relied on by the plaintiff's coun- 
 sel being the subsequent marriage of the plaintiff, I think the letter 
 discloses no consideration. It is in these words [his Lordship read it] . 
 It is by no means clear that the words "at starting" mean "on mar- 
 riage with Ellen Nicholl," or with any one else. The more natural 
 meaning seems to me to be "at starting in the profession," for it will be 
 observed that these words are used by the testator in reciting a 
 prior promise, made when the testator had not heard of the proposed 
 marriage with Ellen Nicholl, or, so far as appears, heard of any pro- 
 posed marriage. This construction is fortified by the consideration 
 that the annuity is not, in terms, made to begin from the marriage, 
 but, as it should seem, from the date of the letter. Neither, is it in 
 terms made defeasible if Ellen Nicholl should die before marriage. 
 
 But even on the assumption that the words "c^t starting" mean "on 
 marriage," I still think that no consideration ' appears sufficient to 
 sustain the promise. The promise is one which, by law, must be in 
 writing; and the fourth plea shows that no consideration or request, 
 dehors the letter, existed, and, therefore, that no such consideration 
 or request can be alluded to by the letter. Marriage of the plaintiff 
 at the testator's express request would be, no doubt, an ample con- 
 sideration, but marriage of the plaintiff without the testator's re- 
 quest is no consideration to the testator. It is true that marriage is, 
 or may be a detriment to the plaintiff ; but detriment to the plaintiff 
 is not enough, unless it either be a benefit to the testator or be treated 
 by the testator as such, by having been suffered a,t his request. Sup- 
 pose a defendant to promise a plaintiff, "I will give you £500 if you 
 break your leg," would that detriment to the plaintiff, shoiild it hap- 
 pen, be any consideration? If it be said that such an accident is an 
 
366 CONSIDERATION (ph. 2 
 
 involuntary mischief, would it have been a binding promise if the 
 testator had said, "I will give you £100 a year while you continue in 
 your present chambers" ? I conceive that the promise would not 
 be binding for want of a previous request by the testator. 
 
 Now, the testator in the case before the court derived, so far as ap- 
 pears, no personal benefit from the marriage. The question, therefore, 
 is still further narrowed to this point, Was the marriage at the testa- 
 tor's request? Express request there was nOne. Can any request be 
 implied? The only words from which it can be contended that it is to 
 be implied are the words, "I am glad to hear of your intended marriage 
 with Ellen Nicholl." But it appears from the fourth plea that that 
 marriage had already been agreed on, and that the testator knew it. 
 These words, therefore, seem to me to import no more than the 
 satisfaction of the testator at the engagement as an accomplished fact. 
 No request can, as it seems to me, be inferred from them. 
 
 And, further, how does it appear that the testator's implied request, 
 if it could be implied, or his promise, if that promise alone would suffice 
 or both together, were intended to cause the marriage, or did cause it, 
 ,so that the marriage can be said to have taken place at the testator's 
 request, or, in other words, in consequence of that request? It seems 
 to me, not only that this does not appear, but that the contrary ap- 
 pears; for the plaintiff before the letter had already bound himself 
 to marry by placing himself not only under a moral, but under a legal 
 obligation to marry, and the testator knew it. The well-known cases 
 which have been cited at the bar in support of the position that a 
 promise, based on the consideration of doing that which a man is 
 already bound to do, is invalid, apply to this case ; and it is not neces- 
 sary, in order to invalidate the consideration, that the plaintiff's prior 
 obligation to afford that consideration should have been an obligation 
 to the defendant. It may have been an obligation to a third person. 
 See Herring v. Dorell [8 Dowl. P. C, 604] and Atkinson v. Settree 
 [ Willes, 482] . The reason why the doing what a man is already bound 
 to do is no consideration, is not only because such a consideration is in 
 judgment of law of no value, but because a man can hardly be allowed 
 to say that the prior legal obligation was not his determining motive. 
 
 But whether he can be allowed to say so or not, the plaintiff does not 
 say so here. He does, indeed, make an attempt to meet this difficulty 
 by alleging, in the replication to the fourth plea, that he married rely- 
 ing on the testator's promise ; but he shrinks froni alleging that though 
 he had promisee^ to marry before the testator's promise to him, never- 
 theless, he would have broken his engagement, and would not have 
 married without the testator's promise. A man may rely on encour- 
 agements to the performance to his duty who yet is prepared to do 
 his duty without those encouragements. At the utmost, the allega- 
 tion that he relied on the testator's promise seems to me to import no 
 more than that he believed the testator would be as gOod as his word.^ 
 It appears to me, for these reasons, that this letter is no more than 
 
Sec. 5) PEKFOEMANCE OF PRE-EXISTING LEGAL DUTY 3G7 
 
 a letter of kindness, creating no legal obligation. In their judgment 
 on the other portions of the record I agree with the rest of the Court. 
 Judgment for the plaintiff. 
 
 VANDERBILT v. SCHREYER. 
 (Court of Appeals of New York, 1883. 91 N. Y. 392.) 
 
 RuGER, C. J.*^ This was an action to foreclose a mortgage for $5,000 
 given September 5th, 1873, by one James Dunseith and wife to Jolm 
 Schreyer, and by him assigned to the plaintiff on May 5th, 1874. 
 
 Schreyer was made a party defendant, and it was sought to charge 
 him with the payment of any deficiency that might arise upon a sale 
 of the mortgaged premises, upon the ground that he had guaranteed 
 the payment of the mortgage debt. 
 
 Schreyer answered, and after admitting the assignment and the 
 guaranty of payment alleged by way of defence, that on February 2d, 
 1874, the plaintiff entered into a contract with George Gebhardt and 
 Matthew E. Ritchie for the erection by him of certain bvlildings for 
 them upon certain lots in the city of New York, for which he was to 
 receive $8,175, to be paid as follows : "When the said houses are topped 
 out, a payment of $5,000 by assignment of a bond and mortgage held 
 by John Schreyer on the property of Anna Maria Schreyer, No. 350 
 West Forty-Second Street, New York City," and the balance, amount- 
 ing to $3,175, when the houses should be fully completed. Vanderbilt 
 commenced performance of his contract and continued until he be- 
 came entitled to the assignment of the $5,000 mortgage. Schreyer 
 thereupon offered to assign it to the plaintiff, but the latter refused 
 to accept an assignment unless Schreyer would also guarantee pay- 
 ment. The defendant refused to do this, and Vanderbilt then sus- 
 pended work upon the buildings for about two months. The defend- 
 ant then under protest, and believing, as he alleges, that he was acting 
 under compulsion, executed the assignment with the guaranty in 
 question. The plaintiff then completed bis contract and received the 
 balance of the consideration. The answer further states "that it was 
 neither under said contract or otherwise made a condition of the plain- 
 tiff's accepting the assignment of said mortgage that this defendant 
 or any dther person should guarantee the payment thereof," and fur- 
 ther "that no consideration ever passed to him or his principals for 
 such guaranty, and the same was and is null and void." 
 
 Upon the trial of the action at Special Term the plaintiff produced 
 and proved the mortgage in question, and also an assignment from 
 defendant to plaintiff in the usual form, but containing the following 
 clause : "And I hereby guarantee the payment of said bond and mort- 
 
 82 Part of the opinion is omitted. 
 
368 CONSIDERATION (Ch. 2 
 
 gage for $5,000 and interest from May 5, 1874, by due foreclosure and 
 sale." The assignment and guaranty were sealed and executed in the 
 presence of a subscribing witness. The plaintiff thereupon rested, and 
 the defendant offered to prove in substance the facts alleged in his 
 answer, which offer was objected to and excluded upon the ground 
 that such answer did not set up facts constituting a defense. The de- 
 fendant excepted to such ruling. The court thereupon held that, said 
 guaranty was absolute and ordered judgment against Schreyer for the 
 deficiency which had previously been ascertained by a sale of the prerii- 
 ises. An appeal was taken to the General Term^ which reversed the 
 judgment and directed a dismissal of the complaint upon the ground 
 that Schreyer was improperly made a defendant, because the guaranty 
 in question was in effect a guaranty of collection only, and that no 
 right of action arose thereon until after the amount of the deficiency 
 had been ascertained by a judicial sale of the mortgaged premises. 
 
 We differ in our conclusion from that reached by both of the courts 
 below.'^ * * * 
 
 A more serious question however arises under. the exception taken 
 to the rulings of the special term excluding the evidence offered by 
 the defendant to prove the facts stated in his answer, showing that 
 the guaranty was without consideration. 
 
 In considering this question the allegatioiis in the answer must be 
 assumed to be true, and that the defendant would have proved them if 
 he had not been precluded by the rulings of the court from doing so. 
 The answer, while perhaps inartificially drawn, certainly alleged all of 
 the facts necessary to show that neither Gebhardt and Ritchie^ nor the 
 plaintiff, had received any consideration for the guaranty in question. 
 This he should have been allowed to prove. The production of the 
 assignment in evidence, purporting to be executed "for value received," 
 and being under seal was prima facie evidence only of a valuable con-, 
 sideration. It was not conclusive and could be disproved if it was in- 
 the defendant's power to do so. 3 Rev. St. (6fh Ed.) 672, § 124; 
 Bookstaver v. Jayne, 60 N. Y. 146 ; Anthony v. Harrison, 14 Hun, 198, 
 affirmed in this court, 74 N. Y. 613. 
 
 The incorporation of this guaranty into the assignment for which 
 there was a consideration does not affect the question. It was not es- 
 sential to the assignment and was, so far as its legal effect was concern- 
 ed, a separate instrument, and must be supported upon a sufiEicient con- 
 sideration or treated as nudum pactum. 
 
 It is quite clear that the plaintiff had no right to demand this guar- 
 anty by the terms of his original contract with Gebhardt and Ritchie. 
 That was satisfied by a mere naked transfer of his interest in the mort- 
 gage. 
 
 83 The court here held that the promise was a conditional guaranty of col- 
 'lection, but that under the procedural statutes the guarantor was properly 
 joined in the foreclosure suit. 
 
Sec. 5) PERFOEMANCE OP PRE-EXISTING LEGAL DUTY 369 
 
 It was held in Van Eps v. Schenectady, 12 Johns. 436, 7 Am. Dec. 
 330, that an agreement to execute a deed of lands was satisfied by the 
 execution of a deed, without warranty or covenants. So it has been 
 held that a party has no right to impose any conditions to the perform- 
 ance of a contract, except those contained in the contract itself. Fur- 
 nace Co. V. French, 34 How. Prac. 94. It being clear that Vanderbilt 
 had no legal right to require, as a condition to the fulfillment of his 
 contract, the performance of an act not required by the contract, it is 
 difficult to see what benefit he has bestowed or what inconvenience he 
 has suffered in return for the undertaking assumed by the defendant. 
 He promises to do only that which he was before legally bound to 
 perform. Even though it lay in his power to refuse to perform his con- 
 tract, he could do this only upon paying the other party the damages 
 occasioned by his nonperformance, and that in contemplation of law 
 would be equivalent to performance. He had no legal or moral right to 
 refuse to perform the obligation of the contract into which he had 
 upon a good consideration voluntarily entered. 
 
 There is no evidence in support of a claim that this guaranty was 
 given as a compromise of any dispute arising with reference to the 
 obligations of the plaintiff under his contract with Gebhardt and 
 Ritchie. The case is not, therefore, brought within the cases in which 
 a promise has been upheld on the theory that it was made in settlement 
 of a controversy over disputed claims. The authorities seem quite uni- 
 formly to show the inadequacy of the consideration alleged for the 
 guaranty in question. In Geer v. Archer, 2 Barb. 420, the defendant 
 visited the plaintiff to pay her an installment upon a mortgage given 
 by him a few weeks before on a purchase of land. She complained that 
 she had not received the fair value of her land upon such purchase. 
 The defendant offered to give her his note for $200 to satisfy her com- 
 plaints. She replied that she would be satisfied with that, whereupon 
 the note in question was given. It was held that this note was void 
 for want of consideration. So where land was sold and described in 
 the deed as containing a certain quantity, and a deficiency was after- 
 ward discoveredj it was held that , there was no obligation on the 
 grantor to compensate the grantee for such deficiency, and a promise 
 to pay the same was without consideration. Smith v. Ware, 13 Johns. 
 257; Ehle v. Judson, 24 Wend. 97. 
 
 Pollock states the rule as follows : That "neither the promise to do 
 a thing, nor the actual -doing of it, will be a good consideration if it is 
 a thing which the party is bound to do by the general law, or by a 
 subsisting contract v/ith the other party.", Pol. Cont. 161; Crosby v. 
 Wood, 6 N. Y. 369; Deacon v. Gridley, 15 C. B. 295. "Nor is the per- 
 formance of that which the party was under a previous valid, legal obli- 
 gation to do a sufficient consideration for, a new contract." 2 Pars. 
 Cont. 437. * * * A promise to pay an attorney additional com- 
 pensation to attend as a witness, after he has been duly subpoenaed, is 
 CoBBiN Cont — 24 
 
370 CONSIDERATION (Ch. 2 
 
 without consideration. The attorney did nothing except what he was 
 legally bound to do. Smithett v. Blythe, 1 Barn. & Adol. 514.** 
 
 It would doubtless be competent for parties to cancel an existing 
 contract and make a new one to complete the same work at a different 
 rate of compensation, but it seems that it would be essential to its 
 validity that there should be a valid cancellation of the original con- 
 tract. Such was the case of L,attimore v. Harsen, 14 Johns. 330. 
 
 It necessarily follows from these authorities that the plaintiff had 
 no right to impose, as a condition to the performance of his contract, 
 that the payment of said mortgage should be guaranteed. Although 
 the defendant was not a party to the original contract and the consid- 
 eration and contract between him, Gebhardt and Ritchie does not ap- 
 pear, yet we must assume that he acted at the request of Gebhardt 
 and Ritchie, and was required only by such contract to execute such 
 an assignment as Gebhardt and Ritchie had contracted to give. The 
 answer, at all 'events, sets up that he received no consideration from 
 any one for the guaranty sued upon. 
 
 The answer also alleges that the sole consideration received for 
 this guaranty was the performance by the plaintiff of his contract 
 with Gebhardt and Ritchie. 
 
 We think this answer sets forth a defense to the action, and inas- 
 much as the defendant has been erroneously deprived of the opportunity 
 of proving it, if in his power to do so, that a new trial should be or- 
 dered. 
 
 The judgment therefore of the general term dismissing the complaint 
 should be reversed, and its order reversing the judgment ordered 
 against the defendant at circuit affirmed, and a new trial ordered, with 
 costs to abide the event. 
 
 All concur, except Andrews and Danforth, JJ., not voting. 
 
 Judgment accordingly. 
 
 McDEVITT V. STOKES. 
 
 (Court of Appeals of Kentucky, 1917. 174 Ky. 515, 192 S. W. 681, L. E. A. 
 
 1917D, 1100.) 
 
 Action by Mike McDevitt against W. E. D. Stokes. Defendant's 
 demurrer to complaint was sustained, and plaintiff appeals. Affirmed. 
 
 Settle, C. J.^^ In this action instituted by the appellant Mike Mc- 
 Devitt, in the court below he sought to recover of the appellee, W. E- 
 D. Stokes, the sum of $800 alleged to be the balance due him of a 
 $1,000 claim which appellee agreed to pay him in the event he won 
 with a mare called "Grace," to be driven by him, the celebrated Ken- 
 
 8* In accord: Dodge v. Stiles, 26 Conn. 463 (1857). But a pi-omise to pay 
 an expert a large sum for investigating and then testifying is enforceable. 
 Barrus v. Phaneuf, 166 Mass. 123, 44 N. B. 141, 32 L. R. A. 619 (1896). 
 
 8 6 Part of the court's discussion of the authorities has been omitted. 
 
Sec. 5) PERFORMANCE OF PRE-EXISTING LEGAL DUTY 371 
 
 tucky Futurity race o£ the Kentucky Trotting Horse Breeders' Asso- 
 ciation at Lexington in October, 1910. In the opinion of the circuit 
 court the facts alleged in the petition did not show a sufficient consid- 
 eration to support the agreement on the part of appellee to pay the 
 $1,000, for which reason the getieral demurrer filed by the latter to 
 the petition was sustained. The appellant declining to plead further, 
 the petition was dismissed, and from the judgment entered in conform- 
 ity to these rulings he prosecutes this appeal. 
 
 The facts constituting appellant's cause of action, fully set forth in 
 the petition, are substantially as follows : At the trotting meeting of 
 the Kentucky Trotting Horse Breeders' Association, held at the city of 
 Lexington in October, 1910, the mare Grace, owned by one Shaw, was 
 entered in the Kentucky Futurity race to be driven by the appellant, 
 McDevitt, a driver of great skill and experience, who was then in 
 Shaw's employ. The Kentucky Futurity race is one of the most noted 
 races among trotting horsemen in the United States, and the winning 
 of it greatly increases the value of the winning horse and also the 
 value of the sire, dam, and brothers and sisters of the winner. The 
 purse offered in the race in question was $14,000, to be divided as fol- 
 lows: To the winner $10,000; to the second horse $2,000; to the «- 
 third horse $1,000; to the fourth horse $500; to the owner of the dam 
 of the winner $300; to the owner of the dam of the second horse $100; 
 to the owner of the dam of the thira horse $75; to the owner of the 
 dam of the fourth horse $25. At the time this race occurred, and for 
 some years prior thereto, the appellee, Stokes, controlled and man- 
 aged a large stock farm near Lexington, together with a number of 
 valuable race horses, bred and reared thereon, and had fonned for op- 
 erating the business a corporation known as the "Patchen Wilkes Stock 
 Farm," of which he owns practical,ly all the stock and is the president 
 and manager. Among the horses then owned by this corporation was 
 Peter the Great, the sire of the mare Grace, Orianna, her dam, Vladi- 
 mir, a yearling, and Kilpatrick, a colt, her full-brothers. As appellee 
 named the mare Orianna as the dam of Grace, entered to win the 
 Kentucky Futurity race, he, or the corporation of which he is presi- 
 dent, was entitled, in the event of the latter's winning it, to receive 
 $300 out of the purse of $14,000, going to the winner. In addition, 
 the value of each of the four horses, Peter the Great, . Orianna, Vladi- 
 mir and Kilpatrick, owned by the corporation of which he is president, 
 would be greatly increased by Grace winning the race. It is alleged 
 in the petition that, influenced by the foregoing considerations, appel- 
 lee agreed to pay appellant the sum of $1,000 if he would drive and 
 win the Kentucky Futurity with the mare Grace, to which the latter 
 agreed ; drove the mare and won the race ; that by reason thereof 
 appellee, or the corporation of which he is president, received, of the 
 $14,000 purse won $300, as owner of Orianna, the dam of Grace, and 
 the value of Peter the Great, the sire of Grace, was increased $10,000, 
 
372 OONSIDEBATION (Ch. 2 
 
 that of Orianna, her dam, $5,000,: and that of Vladimii? and Kilpat- 
 rick, her brothers, $5,000 each. 
 
 It is insisted for appellant that the above-enunierated benefits re- 
 ceived by appellee from the winning of the trotting race by the mare 
 Grace, which resulted in large measure from his skill in driving her, 
 constitutes -a sufficient consideration foi" the promise and undertaking 
 of appellee to pay him the $1,000. This contention ignores consider- 
 ation of another element of the alleged contract between the parties 
 which, in our minds, is conclusive of its invalidity, viz. that appellant, 
 because of his employment by Shaw, the owner of the mare Grace, 
 was already both morally and legally bound to perform the service re- 
 quired of him by the alleged contract he made with appellee; hence 
 its performance, as legally required by his contract with Shaw, would 
 inevitably have resulted in the benefits received by appellee, in the ab- 
 sence of the alleged contract made by the latter to pay therefor. To 
 hold that appellant would not have won the race with Grace but for 
 the -agreement of appellee to pay him the $1,000 if he would do so 
 would be to say that he would have been recreant to the obligation 
 arising out his employment by Shaw, an inferecce not justified by 
 anything appearing in the petition. 
 
 We find no fault with the argument of appellant's counsel that a 
 consideration which is either of benefit to the promisor or detriment 
 to the promisee will be regarded sufficient to uphold the contract be- 
 tween the parties ; nor_ are we inclined to depart from any principle 
 announced in the cases of Talbott v. Stemmons, 10 Ky. L,aw Rep., 33, 
 Ryan v. Tribble, 60 S. W. 633, 22 Ky. Law Rep. 1447, Moayon v. 
 Moayon, 114 Ky. 864, 72 S. W. 33, 24 Ky. Law Rep. 1641, 60 L. R. A. 
 415, 102 Am. St. Rep. 303, Van Winkle v. King, 145 Ky. 693, 141 
 S. W. 46, First State Bank, etc., v. Morton, 146 Ky. 293, 142 S. W. 
 694, and Shadwick v. Smith, 147 Ky. 160, 143 S. W. 1027, relied on 
 in the brief of counsel. The contracts discussed and passed on in those 
 cases rest upon no such facts as are presented by the contract in the 
 instant case, nor do they, or any qf them, conflict with the conclusions 
 at which we have arrived. 
 
 It will be found from an examination of those cases that the benefit 
 resulting to the promisor, constituting the consideration of the con- 
 tract, was some legal right acquired of the promisee to which he would 
 not otherwise have been entitled, or that the detriment resulting to the 
 promisee, constituting the consideration of the contract," was the waiv- 
 «r or loss of some legal right in return for the promise he would other- 
 wise have availed himself of. Our meaning will be better explained 
 by the following excerpt from Page on Contracts, vol. 1, § 274, in 
 which the author, in discussing the meaning of the words "valuable 
 consideration," says : 
 
 "The use of 'benefit' and 'detriment' in this connection needs ex- 
 planation. While correct if properly understood, it is liable to mis- 
 
.Sec. 5) PERFORMANCE OF PRE-EXISTING LEGAL DUtV 373 
 
 construction. /Benefit' does not refer to any pecuniary gain arising 
 out of the transaction, nor 'detriment' to any pecuniary loss. It is not 
 possible to wait until the transaction is concluded and. the ;books bal- 
 anced to see whether the consideration existed originally. 'Benefit' as 
 used in this rule means that the promisor has, in return for a promise, 
 acquired some legal right to which he would not otherwise have been 
 entitled; 'detriment' means that the promisee has, in return for the 
 promise, forborne some legal right which he would otherwise have 
 been entitled to exercise." * * * 
 
 In 9 Cyc. at page 347, it is said : 
 
 "A promise to do what the promisor is already bound to do can- 
 not be a consideration, for if a person gets nothing in return for his 
 promise but that to which he is already legally entitled, the consider- 
 ation is unreal. This legal obligation may arise from (1) the law inde- 
 pendent of contract, or it may arise from (2) a subsisting contract. 
 * *. * Where a party is under duty created or imposed by law to 
 do what he does, or promises to do, his act or promise is clearly of no 
 value and is not a sufficient consideration for a promise given in re- 
 turn." 
 
 Obviously the rule stated must also obtain where the promise is 
 made by a third party to induce the promisee to carry out an existing 
 contract which he has with another. Indeed, this was declared to be 
 the law by this court as far back as 1822 in Ford v. Crenshaw, 1 Litt. 
 68, doubtless the first case involving the question decided in this ju- 
 risdiction. Instead of reciting the voluminous facts or commenting 
 upon the opinion, we here give the conclusions reached by the court, 
 which are correctly and with admirable clearness expressed in the first 
 paragraph of the syllabus, as follows : 
 
 "Where a man has, by his own contract, become morally and legally 
 bound to do an act, he cannot maintain an action on the promise of .a 
 third person, afterwards made, to pay him for doing it." * * * 
 
 It is apparent from the facts alleged in the petition and the appli- 
 cation to them of the principle announced by the authorities, supra, 
 that the petition fails to state a cause of action against appellee. The 
 latter was, it is true, benefited by the winning of the Kentucky Futur- 
 ity purse by the mare Grace, driven by appellant, but the benefit was 
 purely incidental and one to which he was entitled regardless of ap- 
 pellant's undertaking with him to win the race or of his, appellee's, 
 ■promise to pay him the $1,000 if he would do so. As appellant un- 
 der his contract with his employer, Shaw, was in duty bound to do 
 what he claims appellee agreed to pay him to perform, it is evident 
 that he neither assumed any added responsibility nor sustained any 
 loss by reason of his Undertaking with appellee that he would cause 
 the mare Grace to win' the race; and no liability was legally imposed 
 upon appellee by his promise to pay him for the service rendered. 
 
 This conclusion makes it unnecessary for U5 .to decide whether the 
 contract was contrary to public policy; he;nce that qiiestipn is not 
 
374 ■ CONSIDERATION (Ch. 2 
 
 passed on. It follows from what has been said that the action of the 
 circuit court in sustaining the demurrer was not error. Wherefore 
 the judgment is affirmed.** 
 
 ABBOTT V. DOANE. 
 
 (Supreme Judicial Court of Massachusetts, 1895. 163 Mass. 433, 40 N. E. 197, 
 34 L. R. A. 33, 47 Am. St. Eep. 465.) 
 
 Contract upon a promissory note for $500, dated December 27th, 
 1892, payable in three months after date to the order of the plaintiff, 
 and signed by the defendant. The answer set up want of considera- 
 tion. At the trial in the Superior Court, before Bond, J., the jury 
 returned a yerdict for the plaintiff, and the defendant alleged excep- 
 tions. The facts appear in the opinion. 
 
 Allen, J.*^ The plaintiff had given his accommodation note to a 
 corporation, which had had it discounted at a bank, and left it un- 
 paid at its maturity. The defendant, being a stockholder, director, 
 and creditor of the corporation, wishing to have the note paid at 
 once for his own advantage, entered iiito an agreement with the plain- 
 tiff whereby he was to give to the plaintiff his own note for the amount, 
 and the plaintiff was to furnish money to enable the defendant to take 
 up the note at the bank. This agreement was carried out, and the 
 defendant now contends that his note to the plaintiff was without 
 consideration, because the plaintiff was already bound in law to take 
 up the note at the bank. 
 
 It is possible that, for one reason or another, both the bank and the 
 plaintiff may have been willing to wait a while, but that the defend- 
 ant's interests were imperilled by a delay, and indeed required that 
 the note should be paid at once, and that the corporation, whose duty 
 it was primarily to pay it, was without present means to do so. Since 
 the defendant was sane, sui juris, was not imposed upon nor under 
 duress, knew what he was about, and probably acted for his own ad- 
 vantage, it would certainly be unfortunate if the rules of law required 
 
 86 In accord: Johnson's Adm'r v. Sellers' Adm'r, .33 Ala, 265 (1858) ; Arend 
 V. Smith, 151 N. Y. 502, 45 N. E. 872 (1897) ; Robinson v. Jewett, 116 N. X. 
 40, 22 N. E. 224 (1889) ; riavana Press Drill Co. v. Ashurst, 148 111. 115, 85 
 N. E. 873 (1893); Reynolds v. Nugent, 25 Ind. 328" (1865); Schuler v. Myton, 
 48 Kan. 282, 29 Pac. 163 (1892) ; Putnam v. Woodbury, 68 Me. 58 (1878) ; 
 Sherwin v. Brigham, 39 Ohio St. 137 (1883) ; Gordon v. Gordon, 56 N. H. 170 
 (1875) ; Wlmer v. Overseers of Poor of Worth Tp.. 104 Pa. 317 (1883) ; Daven- 
 port V. First Congregational Soc, 33 Wis. 387 (1873) ; Hanks v. Barron, 95 
 Tenn. 275, 32 S. W. 195 (1895) ; Marinovich v. Kilburn, 153 Cal. 638, 96 
 Pac. 303 (1908). 
 
 See Williston, 8 Harv. L. Rev. 32-38; 27 Harv. L. Rev. 503; Ames, 12 
 Harv. L. Rev. 519-521; Beale, 17 Harv. L. Rev. 71; Corbin, "Does a Pre- 
 existing Duty Defeat Consideration" (1918) 27 Tale L. Jour. 362. 
 
 If under a contract one has an alternative or option and gives this up for 
 a new promise, there is a sufficient consideration. Thomson v. Way, 172 
 Mass. 423, 52 N. E. 525 (1899). 
 
 87 Part of the opinion is omitted. 
 
Sec. 5) PERFORMANCE OP PRE-EXISTING LEGAL DUTY 375 
 
 US to hold his note invalid for want of a sufficient consideration, 
 when he has had all thp benefit that he expected , to get from it. 
 
 In this Commonwealth it was long ago decided that, even between 
 the original parties to a building contract, if after having done a 
 part of the work the builder refused to proceed, but afterward, on 
 being promised more pay by the owner, went on and finished the 
 building, he might recover the whole sum so promised. * * * 
 
 But when one who is unwilling or hesitating to go on and perform 
 a contract which proves a hard one for him is requested to do so by a 
 third person who is interested in such performance, though having 
 no legal way of compelling it, or of recovering damages for a breach, 
 and who accordingly makes an independent promise to pay a sum of 
 money for such performance, the reasons for holding him bound to 
 such payment are stronger than where an additional sum is promised 
 by the party to the original contract. 
 
 Take an .illustration. A. enters into a contract with B. to do some- 
 thing. It may be to pay money, to render service, or to sell land or 
 goods for a price. The contract may be not especially for the benefit 
 of B., but rather for the benefit of others; as, e. g., to erect a monu- 
 ment, an archway, a memorial of some kind, or to paint a picture to 
 be placed where it can be seen by the public. The consideration mov- 
 ing from B. may be executed or executory ; it may be money, or any- 
 thing else in law deemed valuable ; it may be of slight value as com- 
 pared with what A. has contracted to do. Now A. is legally bound 
 only to B., and if he breaks his contract nobody but B. can recover 
 damages, and those damages may be slight. They may even be al- 
 ready liquidated at a small sum by the terms of the contract itself. 
 Though A. is legally bound, the motive to perform the contract may 
 be slight. If after A. has refused to go on with his undertaking, or 
 while he is hesitating whether to perform it or submit to such damages 
 as B. may be entitled to recover, other persons interested in having 
 the contract performed intervene, and enter into a new agreement 
 with A., by which A. agrees to do that which he was already bound by 
 his contract with B. to do, and they agree jointly or severally to pay 
 him a certain sum of money, and give their note or notes therefor, and 
 A. accordingly does what he had before agreed to do, but what per- 
 haps he might not otherwise have done, no good reason is perceived 
 why they should not be held to fulfill their promise. They have got 
 what they bargained for, and A. has done what otherwise he might 
 not have done, and what they could not have compelled him to 
 
 fi/^ -K V -K 
 
 Without dwelling further on the reasons for the doctrine, it seems 
 to us better to hold, as a general rule, that if A. has refused or hesi- 
 tated to perform an agreement with B., and is requested to do so by 
 C, who will derive a benefit from such performance, and who promis- 
 es to pay him a certain sum therefor, and A. thereupon undertakes 
 to do it, the performance by A. of his agreement in consequence of 
 
376 OONSIDEEATIOS (Ch. 2 
 
 such request and promise by C. is a good consideration to support 
 C.'s promise. 
 
 Exceptions ovei-riiled.*' 
 
 DE CICCO V. SCHWEIZER et al. 
 
 (Court of Appeals of New York, 1917. 221 N. Y. 431, 117 N. E. 807, L. R. A. 
 1918E, 1004, Ann. Cas. 191S0, 816.) 
 
 Action by Attilio De Cicco against, Joseph Schweizer and others. 
 From a judgment of the Appellate Division, First Department (166 
 App. Div. 919, 152 N. Y. Supp. 1106), modifying and affirming a 
 judgment of the trial term in favor of plaintiflf, the defendant named 
 appeals. Affirmed. 
 
 Gardozo, J.*° On January 16, 1902, "articles of agreement" were 
 executed by the defendant Joseph Schweizer, his wife, Ernestine, and 
 Count Oberto Gul'inelli. The agreement is in Italian. We quote from 
 a translation the part essential to the decision of this controversy : 
 
 "Whereas, Miss Blanche Josephine Schweizer, daughter of said Mr. 
 Joseph Schweizer and of said Mrs. Ernestine Teresa Schweizerj is 
 now affianced to and is to be married to the above said Count Oberto 
 Giacomo Giovanni Francesco Maria Gulinelli: Now in consideration 
 of all that is herein set forth the said Mt, Joseph Schweizer promises 
 and expressly agrees by the present contract to pay annually to his said 
 daughter Blanche, during his own life and to send her, during her 
 lifetime, the sum of two thousand five hundred dollars, or the equiva- 
 lent of said sum in francs, the first payment of said amount to be made 
 on the 20th day of January, 1902." 
 
 Later articles provided that "for the same reason heretofore set 
 forth," Mr. Schweizer will not change the provision made in his wiU 
 for the benefit of his daughter and her issue, if any. The yearly pay- 
 ments in the event of his death are tO' be continued by his wife. 
 
 On January 20, 1902, the marriage occurred. On the same day, the 
 defendant made the first payment to his daughter. He continued the 
 payments annually till 1912. This action is brought to recover the 
 installment of that year. The plaintiff' holds an assignment executed 
 by the daughter, in which her husband joined. The question is wheth- 
 er there is any consideration for the promised aijnujty. That mar- 
 riage may be a sufficient consideration is not disputed. The argument 
 for the defendant is, however, that Cpunt Gulinelli was already aifianced 
 to Miss Schweizer, and that the marriage was merely the fulfillment 
 
 88 In accord: Scotson v. Pegg, 6 H. & N. 295 (1861). And see, further, 
 Merrick v. Giddings, 1 Mackey (D. C.) 394 (1882) ; Ohamplain CoHst. Co. v. 
 O'Brien (C. O.) 117 Fed. 271 (1902); Donnelly v. Newbold, 94 Md. 220, 50 
 Atl. 513 (1901); Day v. Gardner, 42 if. J. Eq. 199, 7 Atl. 365 (1886); Humes 
 V. Decatur Land Improvement & Furnace Co., 98 Ala. 461, 473, 13 South. 368 
 (1893), distinguishing Johnson's Adm'r v. Sellers' Adm'r, 33 Ala. 265 (1858). 
 
 89 The concurring opinion of Crane, J., is omitted. 
 
Sec. 5) PERFORMANCE OF PRE-EXISTING LEGAL DUTT 877 
 
 of an existing legal duty. For this reason, it is insisted, considera- 
 tion was lacking. The argument leads us to the discussion of a vexed 
 problem of the law which has been debated by courts and writers with 
 much subtlety of reasoning and little harmony gf results. There is 
 general acceptance of the proposition that where A. is under a con- 
 tract with B., a promise made by one to the other to induce performance 
 is void. The trouble comes when the promise to induce performance 
 is made by C, a stranger. Distinctions are then drawn between bi- 
 lateral and unilateral- contracts ; between a promise by C. in return for 
 a new promise by A., and a promise by C, in return for performance 
 by A. Some jurists hold that there is consideration in both classes of 
 cases. Ames, Two Theories of Consideration, 12 Harv. L. Rev. 515; 
 13 Harv. L. Rev. 29, 35 ; Langdell, Mutual Promises as a Considera- 
 tion, 14 Harv. h. Rev. 496; Leake, Contracts, p. 622. Others hold 
 that there is consideration where the promise is made for a new prom- 
 ise, but not where it is made for performance. Beale, Notes on Con- 
 sideration, 17 Harv. L. Rev. 71; 2 Street, Foundations of Legal Lia- 
 bility, pp. 114, 116; Pollock, Contracts (8th Ed.) 199; Pollock, After- 
 thoughts on Consideration, 17 Law Quarterly Review, 415 ; 7 Hals- 
 bury, Laws of England, Contracts, p. 385 ; Abbott v. Doane, 163 Mass. 
 433, 40 N. E. 197, 34 L. R. A. 33, 47 Am. St. Rep. 465. Others hold 
 that there is no consideration in either class of cases. Williston, Suc- 
 cessive Promises of the Same Performance, ,8 Harv. L. Rev. 27, 34; 
 Consideration in Bilateral Contracts, 27 Harv, L. Rev. 503, 521 ; An- 
 son on Contracts (Uth Ed.) p. 92. 
 
 The storm center about which this controversy has raged is the case 
 of Shadwell v. Shadwell, 9 C. B. (N. S.) 159; 99 E. C. L. 158, which 
 arose out of a situation similar in many features to the one before us. 
 Nearly everything that has been written on the stibject has been a com- 
 mentary on that decision. There an uncle promised to pay his nephew 
 after marriage an annuity of £150. At the time of the promise the neph- 
 ew was already engaged. The case was heard before Erie, Ch. J., and 
 Keating and Byles,.JJ. The first two judges held the promise to be 
 enforceable. Byles, J., dissented. His view was that the nephew, being 
 already affianced, had incurred no detriment upon the faith of the 
 promise, and hence that consideration was lacking. Neither of the 
 two opinions in Shadwell v. Shadwell can rule the case at bar. There 
 are elements of difference in the two cases which raise new problems. 
 But the earlier case, with the literature which it has engendered, gives 
 us a point of depa.rture and a method of approach. 
 
 The courts of this state are committed to the view that a promise 
 by A. to B. to induce him not to break his contract with C. is void. 
 Arend v. Smith, 151 N. Y.'502, 45 N. E. 872; Vanderbilt v. Schreyer, 
 91 N. Y. 392; Seybolt v. N. Y., L. E. & W. R. R. Co., 95 N. Y. 562, 47 
 Am. Rep. 75; Robinson v. Jewett, 116 N. Y. 40, 22 N. E. 224. If 
 that is the true nature of this promise, there was no copsiderationi We 
 
378 CONSIDERiTION (Ch. 2 
 
 have never held, however, that a like infirmity attaches to a promise 
 by A., not merely to B., but to B. and C. jointly, to induce them not to 
 rescind or modify a contract which they are free to abandon. To de- 
 termine whether that is in substance the promise before us, there is 
 need of closer analysis. 
 
 The defendant's contract, if it be one, is not bilateral. It is unilat- 
 eral. Miller V. McKenzie, 95 N. Y. 575, 47' Am. Rep. 85. The con- 
 sideration exacted is not a promise, but an act. The count did not 
 promise anything. In effect the defendant said to him : If you and 
 my daughter marry, I will pay her an annuity for life. Until mar- 
 riage occurred, the defendant was not bound. It would not have been 
 enough that the count remained willing to marry. The plain import of 
 the contract is that his bride also should be willing, and that mar- 
 riage should follow. The promise was intended to 'affect the conduct, 
 not of one only, but of both. This becomes the more evident when 
 we recall that though the promise ran to the count, it was intended for 
 the benefit of the daughter. Durnherr v. Rau, 135 N. Y. 219, 32 N. 
 E. 49. When it came to her knowledge, she had the right to adopt and 
 enforce it. Gifford v. Corrigan, 117 N. Y. 257, 22 N. E. 756, 6 L. R. A. 
 610, 15 Am. St. Rep. 508; Buchanan v. Tilden, 158 N. Y. 109, ^2 N. E. 
 724, 44 L. R. A. 170, 70 Am. St. Rep. 454; Lawrence v. Fox, 20 N. Y. 
 268.- In doing so, she made herself a party to the contract. Gifford 
 V. Corrigan, supra. If the contract had been bilateral, her position 
 might have been different. Since, however, it was unilateral, the con- 
 sideration being performance (Miller v. McKenzie, supra), action on 
 the faith of it put her in the same position as if she had been in form 
 the promisee. That she learned of the promise before the marriage 
 is a legitimate inference from the relation of the parties and from 
 other attendant circumstances. The writing was signed by her par- 
 ents ; it was delivered to her intended husband ; it was made four days 
 before 'the marriage; it called for a payment on the day of the mar- 
 riage; and on that day payment was made, and made to her. From 
 all these circumstances, we may infer that at the time of the marriage 
 the promise was known to the bride as well as the husband, and that 
 both acted upon the faith of it. 
 
 The situation, therefore, is the same in substance as if the promise 
 had run to husband and wife alike, and had been intended to induce per- 
 formance by both. They were free by common consent to terminate 
 their engagement or to postpone the marriage. If they forbore from 
 exercising that right and assumed the responsibilities of maiTiage 
 in rehance on the defendant's promise, he may not now retract it. The 
 distinction between a promise by A. to B. to induce him not to break 
 his contract with C, and a like promise to induce him not to join 
 with C. in a voluntary^ rescission, is not a new one. It has been sug- 
 gested in cases where the new promise ran to B. solely, aiid not to B. 
 and C. jointly. Pollock, Contracts (8th Ed.) p. 199 ; Williston, 8 Harv. 
 
Sec. 5) PERFORMANCE OF PRE-EXISTING LEGAL DUTT 379 
 
 Iv. Rev. 36. The criticism has been made that in such circumstances 
 there ought to be some evidence that C. was ready to withdr&.w. Wil- 
 liston, supra, pp. 36, 37. Whether that is true of contracts to marry 
 is "not certain. Many elements foreign to the ordinary business contract 
 enter into such engagements. It does not seem a far-fetched assump- 
 tion in such cases that one will release where the, other has repented. 
 We shall assiame, however, that the criticism is valid where the promise 
 is intended as an inducement to only one of the two parties to the con- 
 tract. It may then be sheer speculation to say that the other party could 
 have been persuaded to rescind. But where the promise is held out as 
 an inducement to both parties alike, there are new and different im- 
 plicatiqns. One does not commonly apply pressure to coerce the will 
 and action of those who are anxious to proceed. The attempt- to sway 
 their conduct by new indvicements is an implied admission that both 
 may waver ; that one equally with the other must be strengthened and 
 persuaded; and that rescission or at least delay is something to be 
 averted, and something, therefore, within the range of not unreasonable 
 expectation. If pressure, applied to both, and holding both to their 
 course, is not' the purpose of the promise, it is at least the natural 
 tendency and the probable result. 
 
 The defendant knew that a man and a woman were assuming the 
 responsibilities of wedlock in the belief that adequate provision had 
 been made for the woman and for future offspring. He offered this 
 inducement to both while they were free to retract or to delay. That 
 they neither retracted nor delayed is certain. It is not to be expected ■ 
 that they should lay bare all the motives and promptings, some avowed 
 and conscious, others perhaps half-conscious and inarticulate, which 
 swayed their conduct. It is enough that' the natural consequence of 
 the defendant's promise was to induce them to put the thought of 
 rescission or delay aside. From that moment, there was no longer a 
 real alternative. There was no longer what philosophers call a "living" 
 option. This in itself permits the inference of detriment. Smith v. 
 Chadwick, 9 App. Cas. 187, 196; Smith v. Land & House Corp., 28 
 Ch. D. 7, 16; Voorhis v. Olmstead, 66 N. Y. 113, 118; Fottler v. Mose- 
 ley, 179 Mass. 295, 60 N. E. 788. "If it is proved tliat the defendants 
 with a view to induce the plaintiff to enter into a contract made a state- 
 ment to the plaintiff of such a nature as would be likely to induce a 
 person to enter into the contract, it is a fair inference of fact that he was 
 induced to do so by the statement." Blackburn, L. J., in Smith v. 
 .Chadwick, supra. The same inference follows, not so inevitably, but 
 still legitimately, where the st^-tement is made to induce the preservation 
 of a contract. It will not do to divert the minds of others from a given 
 line of conduct, and then to urge that because of the diversion the 
 opportunity has gone by to say how their minds would otherwise have 
 acted. If the tendency of the promise is to induce them to per- 
 severe, reliance and detriment may be inferred from the mere fact of 
 
380 CONSIDERATION (Ch. 2 
 
 performance. The springs of conduct are subtle and varied. One 
 who meddles with them must not insist upon too nice a measure of 
 proof that the spring which he released was effective to the exclusion of 
 all others. 
 
 One other line of argument must be considered. The suggestion 
 is made that the defendant's promise was not made animo contrahendi. 
 It was not designed, we are told, to sway the conduct of any one; it 
 was merely the offer of a gift which found its motive in the engagement 
 of the daughter to the count. Undoubtedly, the prospective marriage 
 is not to be deemed a consideration for the promise "unless the parties 
 have dealt with it on that footing." Holmes, Common I^w, p. 292; 
 Fire Ins. Ass'n v. Wickham, 141 U. S. 564, 579, 12 Sup. Ct. 84 (35 L. 
 Ed. 860). "Nothing is consideration that is not regarded as such by 
 both parties." Philpot v. Gruninger, 14 Wall. 570^ 577 (20 h. Ed. 743) ; 
 Fire Ins. Ass'n v. Wickham, supra. But here the very formality of the 
 agreement suggests a purpose to effect the legal relations of the sign- 
 ers. One does not commonly pledge one's self to generosity in the 
 language of a covenant. That the parties believed there was a consid- 
 eration is certain. The document recites the engagement and the com- 
 ing marriage. It states that these are the "consideration" for the prom- 
 ise. The failure to marry would have made the promise ineffective. 
 In these circumstances w? cannot say that the promise was not intended 
 to control the conduct of those whom it was designed to benefit. Cer- ' 
 tainly we cannot draw that inference as one of law. Both sides moved 
 for the direction of a verdict, and the trial judge became by consent the 
 trier of the facts. If conflicting inferences were possible, he chose 
 those favorable to the plaintiff. 
 
 The conclusion to which we are thus led is reinforced by thqse con- 
 siderations of public polidy which cluster about contracts that touch 
 the marriage relation. The law favors marriage settlements, and 
 seeks to uphold them. It puts them for many purposes in a class by 
 themselves. Phalen v. U. S. Trust Co., 186 fi. Y. 178, 181, 78 N. E. 
 943, 7 L. R. A. (N. S.) 734, 9 Ann. Cas. 595. It has enforced them 
 at times where consideration, if present at all, has been dependent 
 upon doubtful inference. . McNutt v. McNutt, 116 Ind. 545, 19 N. E. 
 115, 2 E. R. A. 372; Appleby v. Appleby, 100 Minn. 408, 111 N. W. 
 305, 10 L. R. A. (N. S.) 590, 117 Am. St. Rep. 709, 10 Ann. Cas. 563. 
 It strains, if need be, to the uttermost the interpretation of equivocal 
 words and conduct in the effort to hold men to the honorable fulfill- 
 ment of engagements designed to influence in their deepest relations 
 the lives of others. 
 
 The judgment should be affirmed with costs. 
 
Sec. 5) PERFORMANCE OP PRE-EXISTING LEGAL DUTY 381 
 
 BRIDGE V. CAGE. 
 (In the Common Pleas, 1605. Ore. Jae. 103.) 
 
 Action on the case in an assumpsit. Whereas an executor sued 
 exfecution by an elegit, the defendant, ut amipus executoris, in consid- 
 . eration tliat the sheriff would execute the writ, and of sixpence given 
 to him by the plaintiff, being under-sheriff of Cambridgeshire, prom- 
 ised to give the plaintiff sixty pounds; and alledges in fact, that he 
 executed the writ; and thereupon brought the action. 
 
 After verdict for the plaintiff, it was moved, that it was not any 
 consideration to maintain the action; for the sheriff by his duty and 
 path ought to execute the writ; and therefore to have a promise of 
 consideration for executing it is not lawful ; and it is quasi extortion, 
 and therefore ill and unlawful. And although it was alledged that 
 this sum promised him is no more than what the statute of 29 EHz. 
 c. 4. allows him to take for his fees, yet that will not help the case; 
 for that .statute only excuseth him for his taking fees, if it ^be no 
 more than what the statute permits ; whereas the common law did not 
 permit him to take any thing for the executing writs! 
 
 Warberton said, although the statute tolerates it, that it is not 
 punishable (as the usury of ten pounds' per one hundred pounds is 
 tolerated); yet it hath been oftentimes adjudged, that for such fees 
 he hath not any remedy by an action. 
 
 Gawdy said, it is not reasonable, that for the executing of a writ by 
 elegit (where peradventure the land is not worth forty shillings) he 
 should have sixpence for every pound of the debt; and here the giv- 
 ing of sixpence is no sufficient consideration, being joined with the 
 other which is unlawful.^— Wherefore it was adjudged for the defend- 
 ant. 
 
 GRAY V. MARTINO. 
 (Supreme Court of New Jersey, 1918. 91 N. J. Law, 462, 103 Atl. 24.) 
 
 Action by Stephen Gray against Theresa D. Martino. Judgment 
 for plaintiff on trial without a jury, and defendant appeals. Reversed. 
 
 MiNTURN, J. The plaintiff pccupied the position of a special police 
 officer in Atlantic City, and incidentally was identified with the work 
 of the prosecutor of- the pleas of the county. He possessed knowledge 
 concerning the theft of certain diamonds and jewelry from the pos- 
 session of the defendant, who had advertised a reward for the recov- 
 ery of the property. In this situation he claims to have .entered into 
 a verbal contract with defendant whereby she agreed to pay him $500 
 if he could procure for her the names and addresses of the thieves. 
 As a result of his mediation with the police authorities the diamonds 
 and jewelry were recovered, and plaintiff brought this suit to recover 
 the promised reward. The district court, sitting without a jury, 
 
382 CONSIDERATION (Ch. 2 
 
 awarded plaintiff a judgment for the amount of the reward, and hence 
 this appeal. 
 
 Various points are discussed in the briefs, but to us the dominant 
 and conspicuous inquiry in the case is. Was the plaintiff during the 
 period of this transaction a public officer, charged with the enforce- 
 ment of the law? The testimony makes it manifest that he was a spe- 
 cial police officer to some extent identified with the work of the pros- 
 ecutor's office, and that position upon well-settled grounds of public 
 policy required him to assist at least, in the prosecution of offenders 
 against the law. 
 
 The services he rendered in this instance must be presumed to have 
 been rendered in pursuance of that public duty, and for its perform- 
 ance he was not entitled to receive a special quid pro quo. 
 
 The cases on the subject are collected in a footnote to Somerset 
 Bank V. Edmund, 10 Ann. Cas. p. 726 (76 Ohio St. 396, 81 N. E. 641, 
 11 L. R. A. [N. S.] 1170), the headnote to which reads: 
 
 "Public policy and sound morals alike forbid that a public officer 
 should demand or receive, for services performed by himi in the dis- 
 charge of official duty, any other or further remuneration or reward 
 than that prescribed and allowed by law." 
 
 This rule of public policy has been relaxed only in those instances 
 where the Legislature for sufficient public reason has seen fit. by stat- 
 ute to extend the stimulus of a reward to the public without distinc- 
 tion, as in the case of United States v. Mathews, 173 U. S. 381, 19 
 Sup. Ct. 413, 43 L. Ed. 738, where the Attorney General, under an act 
 for "the detection and prosecution of crimes against the United 
 States," made a public offer of reward sufficiently liberal and generic, 
 to comprehend the services of a federal deputy marshal. Exceptions 
 of that character upon familiar principles serve to emphasize the cor- 
 rectness of the rule, as one based upon sound public policy. 
 
 The judgment below for that reason must be reversed. '"' 
 
 RYAN v. DOCKERY. 
 
 (Supreme Court of Wisconsin, 1908. 134 Wis. 431, 114 N. W. 820, 15 L. E. A. 
 [N. S.] 491, 126 Am. St. Rep. 1025.) 
 
 Proceedings by Edward Ryan to establish a claim against the es- 
 tate of Eliza Ryan, deceased, contested by Patrick Dockery, adminis- 
 trator. From a judgment granting insufficient relief, claimant ap- 
 peals. Affirmed. 
 
 The appellant, Edward Ryan, filed a claim in the county court 
 against the 'estate of his deceased wife, Eliza Ryan, for care, support, 
 and nursing of said wife from the time of their marriage, August 4, 
 1900, yup to the time of her death, February 28, 1905. The complaint 
 
 90 In, accord: Pool v. City of Boston, 5 Cush. (Mass.) 219 (1849); Thacker 
 V. Smith, 1C>3 ICan. 641, 175 Pac. 983 (1918). 
 
Sec. 5) PERFORMANCE OF PRE-EXISTING LEGAL DUTY 383 
 
 as filed in county court was substantially upon quantum meruit, and 
 the claim was allowed in that court at the sum of $1,000. The ad- 
 ministrator appealed, and in the circuit court an amendment to the 
 complaint was allowed, by which it was alleged that just prior to the 
 marriage of the parties, and on the same day, the deceased agreed with 
 the claimant that, in consideration of his services in caring for, sup- 
 porting, and nursing her, she would leave him all her property upon 
 her death, should he survive her ; and that she failed to perform such 
 promise, to the claimant's damage in the sum of $1,750. It appeared 
 on the trial that Eliza Ryan was a widow with a small property and 
 living alone at the time of the alleged promise, and was blind, and 
 consequently in need of some one to care for her. The jury by special 
 verdict found (1) that before the marriage a contract was made be- 
 tween the parties by which the claimant agreed to take care of, sup- 
 port, nurse, and see to the comfort of deceased during her life, and 
 the deceased agreed to pay therefor by giving him what property she 
 might leave at her death for his use during his life; (2) that said 
 agreement was not made as part of their contract to marry or as a 
 consideration for the marriage; (3) that the support, nursing, and 
 care were not such as the parties contemplated should result from the 
 marriage relation ; and (4) that claimant fully performed the contract 
 on his part: Upon motion the court held that the negative answer to 
 the second question was wholly unsupported by the testimony, and 
 that said question should be answered in the affirmative, but allowed 
 the answer to the third question to stand. The court further held 
 that as a part of the consideration was Ryan's promise to marry the 
 deceased, which was void because not in writing, the entire contract 
 was void; but that it would serve to rebut the presumption that the 
 services rendered were to be gratuitous. Hence the court concluded 
 that there might be a recovery for the reasonable value of the services, 
 but, there being no proof as to what the services were worth, the 
 . claimant could recover only nominal damages and costs. Judgment in 
 accordance with this conclusion was rendered, and the claimant ap- 
 peals. 
 
 WiNSLOW, C. J. (after stating the facts as above). We think that the 
 court was entirely right in changing the answer to the second ques- 
 tion of the verdict; but, as a verdict for the defendant should have 
 been directed upon the undisputed evidence, neither this question nor 
 the other detail errors claimed by the plaintiff are important. 
 
 One consideration alone disposes of the plaintiff's claim adversely 
 to him. The law requires a husband tq support, care for, and pro- 
 vide comforts for his wife in sickness, as well as in health. This re- 
 quirement is grounded upon principles of public policy. The hus- 
 band cannot shirk it, even by contract with his wife, because the public 
 welfare requires that society be thus protected so far as possible from 
 the burden of supporting those of its members who are not ordinarily 
 expected to be wage earners, but may still be performing some of the 
 
384 CONSIDERATION (Ch. 2 
 
 most important duties pertaining to the social order. Husband and 
 wife may contract with each other before marriage as to. their mutual 
 property rights, but they cannot vary the personal duties and obliga- 
 tions to each other which result from the marriage contract itself. 
 Schouler, Domestic Relations (5th Ed.) § 171 ; 21 Cyc. 1242. It re- 
 sults from this that, when the plaintiff promised to care for, nurse, and 
 support the deceased after marriage, he promised only to do that 
 which the law required him to do in any event and neither the doing 
 of what one is in law bound to do nor the promising so to do is any 
 consideration for another's promise. I Page on Contracts", § 311 ; Post 
 V. Campbell, 110 Wis. 378, 85 N. W. 1035. The alleged promise of 
 the deceased was therefore nudum pactum. The plaintiff simply per- 
 formed duties required of him by law as a husband which he could 
 not avoid or contract away, and there can be no recovery either upon 
 express contract, nor will the law imply a contract. 
 Judgment affirmed.' "^ 
 
 HARTLEY v. INHABITANTS OF GRANVILLE. 
 
 (Supreme Judicial Court of Massachusetts, 1913. 216 Mass. 38, 102 N. E. 942, 
 48 L. R. A. [N. S.] 392, Ann. Cas. 1915A, 725.) 
 
 Action by Harry S. Hartley against the Inhabitants of Granville,. 
 Verdict for plaintiff, and defendant excepts. Exceptions overruled.. 
 
 RuGG, C. J. This is an action to recover the amount of a reward 
 which the selectmen of the defendant in 1909 offered "to any person 
 furnishing evidence that will convict the person or persons who" had 
 set recent fires in that town. The plaintiff was duly elected and qual- 
 ified as a constable of the defendant town for that year. There was no 
 evidence tending to show that any regular compensation was paid to 
 the plaintiff as constable, or that he had any special arrangement with 
 the defendant for pay, or that his duties were any other than such 
 as by the common and statute law of the commonwealth are incum- 
 bent upon constables. 
 
 The general duties of such an officer are to be vigilant to preserve 
 the peace, to prevent the commission of crime, and to arrest all of- 
 fenders in his town who might be arrested without warrant, and to 
 procure warrants in other instances of crime committed. The quaint 
 description of his duties given in early definitions is "to keep the king's 
 peace." To keep the peace in its broad sense means to quell riots and 
 disturbances of every nature, to prevent the commission of crime and 
 to see that offenders in their several districts are arrested and pros- 
 ecuted. They possess somewhat extensive powers. See 1 Blackstone.'s 
 Com. 356. But in our country communities constables as such are not 
 
 81 In accord: Foxworthy v. Adams, 136 Ky. 403, 124 S. W. 381, 27 L R A. 
 (N. S.) 308, Ann. Cas.'1912A, 327 (1910). Query: Oid not the contract create a 
 duty in the plaintiff before he assumed such a duty by the marriage? 
 
Sec. 5) PEEFORMANCE OP PEE-EXISTING LEGAL DUTY 385 
 
 expected nor required to devote a considerable portion of their time 
 to the work of their office. In this regard they stand on a basis quite 
 different from the members of an organized police force. It is matter 
 of common knowledge that the country constable in this common- 
 wealth is elected oftentimes from among those who labor regularly 
 to earn a livelihood for themselves and their families, but whose ehar- 
 a.cter, courage or reputation for physical prowess are such as to make 
 them efficient conservators of the public peace. The theory on, which 
 the office now is based (apart from the functions of serving papers) is 
 that a number of competent. men scattered through the territory of 
 each of the country towns, charged with such duties, is an important 
 factor in making them safe for residence by law-abiding people. 
 
 The office of constable is an ancient one, but its duties have been 
 modified from time to time by custopi and statute. The constable 
 is a public officer. Any person elected to the office is liable to a "for- 
 feit of money if he refuses to -serve. R. L. c. 25, § 97. He is not 
 entitled to compensation for services rendered to the town in the per- 
 formance of general duties as peace officer, at all events in the ab- 
 sence of special contract. Riopel v. Worcester, 213 Mass. IS, 99 N. E. 
 478. The theory of the law is that those chosen to such office by their 
 fellow citizens will accept and execute the office either from a sense 
 of public duty or under the compulsion arising from the pecuniary 
 forfeit entailed by a refusal, and not from hope of money gain. Farns- 
 worth V. Melrose, 122 Mass. 268. These considerations reinforce 
 the conclusion that the obligation is not incumbent upon the constable 
 to give up his ordinary occupation and spend substantial time in search 
 for evidence which may or may not lead to the detection of criminals, 
 nor perform the work crommonly done by detectives. The general rule 
 with reference to peace officers is well settled that a promise or reward 
 for additional compensation to a public officer for services rendered 
 in the performance of his duty cannot be enforced, either as being with- 
 out consideration or contrary to public policy. Pool v. Boston, S 
 Cush. 219; Dunham v. Stockbrige, 133 Mass. 233; Davies v. Biirns, 
 5 Allen, 349; Brophy v. Marble, 118 Mass. 548. This rule is based 
 upon sound considerations and ought not to be narrowed in any respect. 
 But it is also true that a contract to pay a public officer for services 
 rendered outside and not inconsistent with his official duty is valid and 
 may, be enforced. A reward offered for such service is also enforce- 
 able. Studley v. Ballard, 169 Mass. 295, 296, 47 N. E. 1000, 61 Am. 
 St. Rep. 286, and cases there cited. Neville v. Kelly, 12 C. B. N. S. 
 740; Russell v. Stewart, 44 Vt. 173; Kasling v. Morris, 71 Tex. 584, 
 9 S. W. 739, 10 Am. St. Rep. 797; Bronnenberg v. Coburn, 110 
 Ind. 169, 11 N. E. 29; Smith v. Vernon County, 188 Mo. 501, 87 
 S. W. 949,- 70 L. R. A. 59, 107 Am. ^t. Rep. 324; Kinn v. First Nat.' 
 Bank, 118 Wis. 537, 546, 95 N. W. 969, 99 Am. St. Rep. 1012; Bur- 
 kee V. Matson, 114 Minn.' 233, 130 N. W. 1025, 34 L. R. A. (N. S.) 
 
 COKBIN CONT 25 
 
386 CONSIDERATION (Ch. 2 
 
 924 » 2 Yjjg many cases cited and relied on by the defendant are not in 
 conflict with this principle. Most of them follow either the authority 
 or reasoning of Pool v. Boston, ubi supra, and relate to facts which 
 bring them within its rule. 
 
 There was evidence in the case at bar that the plaintiff spent sub- 
 stantial time in the performance of purely detective work in the in- 
 vestigation and collection of evidence in consequence of the offer of 
 reward outside the service rendered in serving the warrant and do- 
 ing in other respects what the law required him to do by virtue of his 
 office as constable. The case on its facts is rather close to the line, 
 but it cannot be said that the finding of fact made by the judge was not 
 warranted. This being so, no error was made in the ruling of law. 
 
 Exceptions overruled.'* 
 
 TOLHURST et al. v. POWERS. 
 
 (Court of Appeals of New York, 1892. 133 N. Y. 460, 31 N. B. 326.) 
 
 Finch, J."* We agree with the prevailing opinion of the General 
 Term that there was no consideration to support the promise of Pow- 
 ers to pay Ball's debt to the plaintiffs. The latter originally con- 
 structed a dynamo, for which Ball became indebted to them, and 
 after all payments he remained so indebted when the machine was 
 ready for delivery. The builders, of course, had a lien upon it for the 
 unpaid balance, but waived and lost their lien by a delivery to Ball 
 without payment. He, being then the owner and holding the title 
 free from any incumbrance, sold the dynamo to Crane on a contract 
 apparently contingent upon the successful working of the machine. 
 It did not work successfully, and was sent back to plaintiffs to be 
 altered with a view of correcting its imperfections. At this point 
 occurred the first intervention of the defendant Powers. He had not 
 then obtained, so far as the case shows, any interest in the machine, 
 and the complete title was either in Crane or Ball or in both ; but when 
 the plaintiffs hesitated about entering upon the new work until their 
 charges for it should be made secure, Powers agreed to pay them. 
 The true character of that promise is immaterial, for when the work 
 was done Powers did pay according to his contract. Thereafter 
 Ball and Powers requiring a delivery of the dynamo, the plaintiffs 
 undertook or threatened to retain the possession till the original debt 
 should be paid. That they had no right to do. Their primary hen 
 was lost by the delivery, and they acquired no new one by reason of 
 
 82 Also In accord: England v. Davidson, 11 A. & E. 856 (1840) ; McCandless 
 V. Allegheny Bessemer Steel Co., 152 Pa. 139, 25 Atl. 579 (1893). 
 
 88 In Relf V. Paige, 55 Wis. 496, 13 N. W. 473, 42 Am. Rep. 731 (1882), a 
 fireman was held entitled to a reward offered for rescuing the body of de- 
 fendant's wife ; his duty not requiring him to risk his life in that way. 
 
 9* Part of the opinion is omitted. 
 
Sec. 6) PAST CONSIDERATION 387 
 
 the repairs which were paid for. Such refusal to surrender the 
 possession was an absolute wrong without any color of right about 
 it. After demand their refusal was a trespass, and according to their 
 own evidence the sole consideration for the promise which they 
 claim tliat- Powers made to pay the old debt of Ball was their surren- 
 der of possession. To that they were already bound,, and parted with 
 nothing by the surrender. They gave up no right which they had 
 against any one, but extorted the promise by a threat of what would 
 have been, if executed, a .wrongful conversion. Doing what they 
 were already bound to do furnished no consideration for the prom- 
 
 ■t Cf* •' ^ ^ T^ T^ 
 
 SECTION 6.— PAST CONSIDERATION 
 (Must the Promise be the Inducing Cause of the Consideration?) 
 
 MOORE V. WILLIAMS. 
 (In the King's Bench, 1586. Moore, K. B. 220.) 
 
 Between Moore and Williams the case was that Williams, being the 
 lessee for years the reversion belonging to Moore, was sued in eject- 
 ment [by a third person] and in defense of his title had spent a large 
 sum of money, and therefore he came to Moore and told him that he had 
 spent much money and asked contribution or other payment. Moore 
 replied that in consideration of this he should have another certain 
 lease after the expiration of his term, as he requested. The term ex- 
 pired and Williams asked for a new lease. Moore would not execute 
 a new lease, and Williams brought an action on the case in assumpsit. 
 It was held not maintainable because the consideration was executed 
 before the promise was made.®* * * * 
 
 HARFORD AND GARDINER'S CASE. 
 (In the King's Bench, 1588. 2 Leon. 30.) 
 
 In an action upon the case, the plaintiff declared, that the defend- 
 ant in consideration that the father of the plaintiff had employed his 
 service about the business of the testator of the defendant, to the 
 great profit of the testator; and in consideration of love and affec- 
 
 95 In accord: Cowper v. Green, 7 M. & W. 633 (1841) ; Fink v. Smith, 170 
 Pa. 124, 32 Atl. 566, 50 Am. St. Rep. 750 (1895). 
 
 »6 Part of the report Is omitted. In accord: Hunt v. Bate> Dyer, 272 (1568) ; 
 Haves v. Warren, 2 Strange, 933 (1732) ; Jeremy v. Goochman, Oro. Eliz. 442 
 (1596). 
 
388 CONSIDERATIOX (Ch. 2 
 
 tion that the testator bore to the plaintiff, promised to give unto him 
 £100. Curia. Love is not a consideration, upon which an action 
 can be grounded ; the like of friendship. Wray. If the plaintiff de- 
 clares,, that the defendant in consideration that he was indebted unto 
 the plaintiff in divers sums of money, and promised to pay him £100 
 it is not good for the incertainty ; , also the consideration here, 
 was past and executed before the promise made, and nothing is done 
 by the son. And afterwards judgment was given against the plain- 
 tiff.»^ 
 
 ■ BABINGTON v. LAMBERT. 
 
 (In the King's Bench, 1617. Moore, K. B. 854.) 
 
 In an action on the case on assumpsit in consideration that'the de- 
 fendant had received £24 from divers persons to the use of the plain- 
 tiff he promised to pay this to the plaintiff on a certain day. Verdict 
 was for the plaintiff. It was moved in arrest of judgment that the 
 declaration was. not good because it did not state from what particu- 
 lar persons the money had been received. But the whole court was 
 against this, because the consideration is executed, and so not tra- 
 versable. Judgment for plaintiff.^' 
 
 JANSON V. COLOMORE. 
 (In the King's Bench, 1617. 1 Rolle, 396.) 
 
 Janson brought an action on the case against Colomore and alleged 
 that -the defendant being indebted to him on an account was found, to 
 be in arrears a certain amount, and in consideration thereof promised 
 to pay the said amount at a certain future day, and for breach of this 
 promise action was brought. After verdict for the plaintiff it was 
 moved in arrest of judgment that an action on the case does not lie,' 
 for the reason that the contract was prior to the promise sued upon 
 and was executed, and this promise to pay at a future day cannot 
 turn it into an executory contract. 
 
 HaughTon said that the action lies, because when the defendant 
 was found to be in arrears he then and there promised, so that at the 
 
 7 That love and affection or blood relationsliip will not operate as consider- 
 ation, see Wright v. Threatt, 146 Ga. 778, 92 S. E. 640 (1917) and note in L. 
 R. A. 19180, 541 ; Maynard v. Maynard, 105 Me. 567, 75 Atl. 299 (1909) ; Fink 
 V. Cox, 18 Johns. (N. Y.) 145, 9 Am. Dee. 191 (1820), where a father gave his 
 son a promissory note for ?I,000 as a mere gift, because this son was not as 
 wealthy as his brotlier; Dougherty v. Salt, 227 N. Y. 200, 125 N. E. 94 (1919), 
 aunt gave note for $3,000 to nephew. 
 
 8 The duty of an executor to pay claims against the estate when there are 
 sufficient assets was held to be a sufficient consideration for a promise by him 
 to pay such a claim out of his own moneys Hawkes v. Saunders, Cowper 289 
 (1782) ; Atkins v. Hill, Cowper, 284 (1775). 
 
Sec. 6) PAST CONSIDERATION 389 
 
 instant the arrears were determined the debt became definite and cer- 
 tain, and upon this the express assumpsit made at the same time is 
 good. This was conceded to be correct by Croke and DoddEridgi; 
 and the latter said that Slade's case established the rule that every 
 executory debt includes an assumpsit.''" (The discussion of another 
 point is omitted.) 
 
 SIDENHAM AND WORLINGTON'S CASE. 
 
 (In the Common Pleas, 1585. 2 Leon. 224.) i 
 
 In an action upon the case upon a promise, the plaintiff declared, 
 that he at the request of the defendant, was surety and bail for J. S. 
 who was arrested in the King's Bench, upon an action of £30 and that 
 afterwards, for the default of J. S. he was constrained to pay the £30 
 after which, the defendant meeting with the plaintiff, promised him 
 for the same consideration, that he would repay the £30 which he did 
 not pay, upon which the plaintiff brought the action; the defendant 
 pleaded, non assumpsit, upon which issue was joyned, which was 
 found for the plaintiff. Walmsley, Serjeant, for the defendant, moved 
 the Cotirt, that this consideration will not maintain the action, because 
 the consideration and promise did not concur and go together ; for 
 the consideration was long before executed, so as now it cannot be in- 
 tended that the promise was for the same consideration, as if one 
 giveth me a horse, and a month after, I promise him £10 for the said 
 horse, he shall never have debt for the £10 nor assumpsit upon that 
 promise; for there is neither contract, nor consideration, because the 
 same is executed. 
 
 9»In accord: Hodge v. Va visor, 1 Rolle's Bep. 413 (1616); Ilowlet's Case, 
 Latch, 150 (1626) ; Barton v. Shurley, 1 Rolle's Abr. 12, pi. 16 (1639). Cf. 
 Hopkins V. Logan, 5 M. & W. 241 (1839). ' 
 
 The account stated Is sufficient consideration without alleging out of what 
 facts the account grew. Bard v. Bard, Cro. Jae. 602 (1620) ; BgleS' v. Vale, 
 Cro. Jac. 69 (1603) ; Homes v. Savill, Oro. Car. 116 (1628). 
 
 In Slade's Case, 4 Coke, 92b. Yelv. 21, Moore, K. B. 433, 667 (1602), it was 
 held after a tremendous struggle that where a legal debt existed the form of 
 action known as assumpsit would lie, and that even if no promise had been 
 made in terms the law would "imply" a promise. The effect of this decision, 
 and probably its purpose also, was to deprive debtors of the ancient defense 
 known as "wager of law," a defense available in the action of debt, but not 
 in assumpsit, a defense that had come to be used dishonestly. If assumpsit 
 would lie to collect a past debt in the absence of an express promise, a for- 
 tiori it would lie if such a promise is made. 
 
 "No case can be, found in which a man's own debt has been ruled to be an 
 insufiBcient consideration between him and his creditor, for a mortgage or 
 other security received by the latter from his debtor." Turner v. Mcl'ee, 61 
 Ala. 468, 472 (1878) ; Paine v. Benton, 32 Wis. 491 (1873) ; Duncan v. Miller, 
 64 Iowa, 223, 20 N. W. 161 (1884) ; ^^Ulliams v. Silliman, 74 Tex. 626, 12 S. W. 
 534 (1889). 
 
 Of course, the existing debt of A. Is not a consideration for the promise of 
 B. to pay it. "Ward v. Barrows, 86 Me. 147, 29 Atl. 922 (1893). Nor is it a 
 consideration for the promise of the debtor himself to pay part of it in ad- 
 vance of the due date. Young v. Ward, 33 Me. 359 (1851). 
 
 1 Also reported in Godbolt, 31 ; Cro. Eliz. 42. 
 
390 CONSIDERATION (Ch. 2 
 
 Anderson, This action will not lie ; for it is but a bare agreement, 
 & nudum pactum, because the contract was determined, and not in 
 esse at the time of the promise ; but he said, it is otherwise upon a 
 consideration of marriage of one of his cosins; for marriage is al- 
 ways a present consideration. Windham agreed with Anderson, and 
 he put the case in 3 H. VII. If one selleth a horse unto another, and 
 at another day he will warrant him to be sound of limb and member, it 
 is a void warrant, for that such warranty ought to have been made or 
 given at such time as the horse was sold. 
 
 Periam, Justice, conceived, that the action did well lie ; and he said, 
 that this case is not like unto the cases which have been put of the 
 other side; for there is a great difference betwixt contracts and this 
 case; for in contracts upon sale, the consideration, and the proniise, 
 and the sale, ought to meet together, for a contract is derived from, 
 con and trahere, which is a drawing together, so as in contracts 
 every thing which is requisite, ought to concur and meet together, viz. 
 the consideriation of the one side and the sale or the promise on the 
 other side; but to maintain an action upon an assumpsit, the same 
 is not requisit, for it is sufficient, if there be a moving cause or con- 
 sideration precedent; for which cause or consideration the promise 
 was made; and such is the cornmon practice at this day: for in an 
 action upon the case, upon a promise, the declaration is laid, that the 
 defendant, for, and in consideration of £20 to him paid, (postea scil.) 
 that is to say, at a day after super se assumpsit, and that is good; 
 and 3'^et there the consideration is laid to be executed; and he said, 
 that the case in Dyer, 10 Eliz. 272, would prove tlie case : for there 
 the case was, that the apprentice of one Hunt, was arrested when his 
 master Hunt was in the country, and one Baker, one of the neigh- 
 bours of Hunt, to keep the said apprentice out of prison, became his 
 bail, and paid the debt; afterwards Hunt the master, returning out 
 of the country, thanked Baker for his neighbourly kindness to his ap- 
 prentice, and promised him, that he would repay him the sum which 
 he had paid for his servant and apprentice: and afterwards upon 
 that promise, Balcer brought an action tipon the case against Hunt, and 
 it was adjudged in that case, that the action would not lie, because 
 the consideration was precedent to the promise, because it was exe- 
 cuted and determined long before. But in that case, it was holden 
 by all the justices, that if Hunt had requested Baker to have been 
 surety or bail, and afterwards Hunt had made the promise for the 
 same consideration, the same had been good, for that the consideration 
 did precede, and was at the instance and request of the defendant. 
 
 Rhodes, Justice, agreed with Periam ; and he said, that if one serve 
 me for a year, and hath nothing for his service, and afterwards, at 
 the end of the year, I promise him £20 for his good and faithful serv- 
 ice ended, he may have and maintain an action upon the case upon 
 the same promise, for it is made upon a good consideration ; but if a 
 servant hath wages given him, and his master, ex abundanti. doth 
 
Sec. 6) PAST CONSIDERATION ' 391 
 
 promise him £10 more after his service ended, he shall not maintain 
 an action for that ilO upon the said promise; for there is not any 
 new cause or consideration preceding the promise; which difference 
 was agreed by all the justices, and afterwards, upon good and long 
 advice, and consideration had of the principal case, judgment was 
 given for the plaintiff, and they much relied upon the case of Hunt 
 and Baker, 10 Eliz. Dyer, 272. See the case there.^ 
 
 RIGGS V. BULUNGHAM.8 
 (In tlie Common Pleas, 1600. Cro. Eliz. 715.) 
 
 Assumpsit. Whereas he was seised in fee of the advowson of Beck- 
 ingham in the county of Lincoln ; in consideration that he, at the de- 
 fendant's request, by his deed, dedisset et concessisset to the defendant 
 the first and next avoidance of the said church, the defendant, 22 Au- 
 gust, 37 Eliz. assumed to pay to the plaintiff £100, &c. Upon non as- 
 sumpsit pleaded, it was found for the plaintiff, and damages assessed 
 to £100. And, after verdict, it was moved in arrest of judgment, that 
 this considei^ation is past, and therefore not suiUcient to ground an as- 
 t sumpsit ; for there is not any time of the grant alleged ; and it might 
 have been divers years before the assumpsit made : and being a thing 
 executed and past, no assumpsit afterwards can be good : and in proof 
 thereof. Dyer, 272. Hunt v. Bates was cited. — But all THg Court re- 
 solved to the contrary; for the grant being made at his request, it 
 is a sufficient consideration, although it were divers years before; 
 especially being to the defendant himself, the consideration shall be 
 taken to continue. But if the grant had been to a stranger, and not 
 at the defendant's request, it had peradventure been otherwise. * * * 
 
 BOSD'EN V. SIR JOHN THINNE. 
 (In the King's Beac-h, 1603. Yelv. 40.) 
 
 The plaintiff declar'd, quod cum ad specialem instantiam of the 
 defendant, he had procur'd credit for one Flud for two pipes of 
 wine amounting to £51 and Flud super credentiam & per medium of 
 the plaintiff, at the request of the defendant emisset of One Roberts 
 two pipes of wine for £51 and superinde the plaintiff with Flud enter'd 
 into bond of £100 to Roberts for payment of the said £51 at a day 
 to come, which was not paid at the day ; And thereupon Roberts sued 
 
 2 Service rendered by the plaintiff at the request of a third person is no 
 consideration for a subsequent promise by the defendant to pay therefor. 
 Thorner v. Field, 1 Bulst. 120 (1612) ; Dearborn v. Bowman, 3 Mete. (Mass.) 
 155 (1841), service at request of Democratic committee in a campaign in which 
 defendant was candidate; Koyer v. Kelly, 174 Oal. 70, 161 Pac. 1148 (1916).' 
 
 8 A small part of the report, dealing with another question, is omitted. 
 
392 ■ CONSIDERAIION (Ch. 2 
 
 the plaintiff upon the bond, and recover'd, and had. a capias against 
 him, whereby he fuit coactus to pay Roberts i67 de solutione of 
 which £67 causa prseallegata he notified to the defendant, who in 
 consideratipne praemissorum promised to pay the pkintiff the i67 
 at Michaelmas; and shewed the failure of payment of the £67 at the 
 day, &c. And upon non assumpsit pleaded, it was found against the 
 defendant. And Yelverton moved in arrest of judgment, that the 
 action, upon the matter shewn, does not lie, because the considera- 
 tion was past, and executed before the promise, and the defendant 
 had no profit by it, but all the benefit was to Flud a stranger ; like the 
 case 10 Eliz. Dy. 272, where J. S. was bail for the servant upon an 
 arrest, and signified all to the master after the bail enter'd into, who 
 promised to save him harmless; and although the bail was con- 
 demn'd yet no assumpsit lay against the master, because the consid- 
 eration was past before the promise: and it seems that upon the first 
 request only to give credit to Flud for two pipes of wine, no assumpsit 
 lies ; for a bare request does not imply any promise : as if I say to a 
 merchant, I pray trust J. S. with £100 and he does so, this is of his 
 own head, and he shall not charge me, unless I say, I will see you 
 paid, or the like. And it seems likewise, that the promise shall not 
 have relation to the first request of giving credit to Flud; because 
 the entreaty for the credit was but for two pipes of, wine amounting 
 to £51 and the promise is for £67 and so they differ in the sunis; 
 as if I request J. S. to enter into bond for J. D. for £10 and I will 
 see him paid; now if J. S. enters into bond of £20 for the payment 
 of £10 for J. D. which £20 is recover'd against him, he shall not charge 
 me on my promise but with £10. But non allocatur per FbnnER, 
 Gawdy and Popham ; for altho' upon the first request only assumpsit 
 does not lie, yet the prornise coming after shall have reference to 
 the first request; and although the request was but for two pipes 
 of wine amounting to £51 that Flud might have credit for that; yet 
 when Roberts, who sold the wine, would not take (as appears) se- 
 curity but by bond of £100 for payment of £51 and all this matter is 
 signified afterwards to the defendant, who agrees to it, and prom- 
 ises to pay the £67 this shall charge him; because it has its essence 
 and commencement from the first request made by the defendant. 
 As (per Gawdy) if I request one to marry my cousin, who does so, 
 and afterwards tells me of it, and thereupon I promise him £100 this 
 is a good promise to charge me, altho' the marriage was past, which is 
 the consideration; because now the promise shall have reference to 
 the request, which was before the marriage. Vide this case, Dy. 272. b. 
 The same law (by him) if I entreat one to be bail for my servant, and 
 he thereupon becomes bail, and is condemn'd, and afterwards tells 
 me of it, and I promise him to save him harmless, it is good, and 
 he shall recover his damage in toto ; wherefore judgment was given 
 for the plaintiff. But , Ybi^vbrton, Justice, was contra clearly. 
 
Sec. 6) PAST CONSIDERATION 393 
 
 LAMPLEIGH v. BRAITHWAIT. 
 
 (In the Common Bencli, 1616. Moore, K. B. 866.) * 
 
 In assumpsit it was alleged that Braithwait having killed a man 
 reqtiested the plaintiff to endeavour to obtain a pardon, by reason 
 whereof the plaintiff went to Royston to the King to obtain the par- 
 don, and in consideration that he had made this endeavour the defend- 
 ant promised him £100. This declaration was demurred to because 
 the consideration was executed before the promise was made. Nich- 
 ols, Winch, and Hobart held that the action was well brought, be- 
 cause there is alleged a request before the acts were performed, and 
 where there is such a precedent request an assumpsit made after the 
 execution of the consideration is binding. * * * 
 
 EASTWOOD V. KENYON. 
 (Court of Queen's Bench, 1840. 11 Adol. & El. 438.) 
 
 Assumpsit. The declaration stated, that one John Sutcliffe made 
 his will, and appointed plaintiff executor thereof, and thereby be- 
 queathed certain property in manner therein mentioned; that he 
 afterwards died without altering his will, leaving one Sarah Sutcliffe, 
 an infant, his daughter and only child and heiress at law surviving; 
 that after making the will John Sutcliffe sold the property mentioned 
 therein, and purchased a piece of land upon which he erected certain 
 cottages, but the same were not completed at the time of his death; 
 v/hich piece of land and cottages were at the time of his death, mort- 
 gaged by him; that he died intestate in respect of the same, where- 
 upon the equity of redemption descended to the said infant as heiress 
 at law; that after the death of John Sutcliffe, plaintiff duly proved 
 the will and administered to the , estate . of the deceased ; that from 
 
 * Also reported in Hob. 105, 1 Brownl. & Gouldsb. 9, q. v. Part of the report 
 Is omitted here. 
 
 There were many cases in accord during this period, and a few contra. 
 American cases in accord are Stuht v. Sweesy, 48 Neb. 767, 67 N. W. 748 
 (1896) ; Pool V. Horner, 64 Md. 131, 20 Atl. 1038 (1885) ; Paul v. Stackhouse, 
 38 Pa. 302 (1861) ; In re Sutch's Estate, 201 Pa. 305, 50 Atl. 943 (1902) ; Sil- 
 verthorn v. Wylie, 96 Wis. 69, 71 N. W. 107 (1897) ; Raipe v. Gorrell, 105 Wis. 
 636, 81 N. W. 1009 (1900). 
 
 In Bradford v. Roulston, 8 Irish C. L. Rep. 468 (1858), the court said: "It 
 is clearly established that, where a past consideration, that is, a thing previ- 
 ously done by the plaintiff at the request of the defendant, is one from which 
 the law implies a promise, an express promise different from, or in addition 
 to, that which the law implies, is nudum pactum, on the ground that the 
 whole consideration is exhausted by the promise which the law implies. [See, 
 also, Trask v. Weeks, post ; Hopkins v. Logan, 5 M. & W. 241 (1839).] * * * 
 But it has also been held, in a long series of decided cases, that where there, is 
 a past consideration, consisting of a previous act done, at the request of the 
 defendant, it will support a subsequent promise ; the promise being treated as 
 coupled with the previous request." 
 
394 CONSIDERATION (Ch. 2 
 
 and after the death of John Sutcliffe until the said Sarah SutcHife 
 came of full age, plaintiff, executor as aforesaid, "acted as the guard- 
 ian and agent" of the said infant, and in that capacity expended large 
 sums of money in and about her maintenance and education, and in 
 and about the completion, management, and necessary improvement 
 of the said cottages and premises in which the said Sarah Sutcliffe was 
 so interested, and in paying the interest of the mortgage money 
 chargeable thereon and otherwise relative thereto, the said expendi- 
 ture having been made in a prudent and useful manner, and having 
 been beneficial to the interest of the said Sarah Sutcliffe to the full 
 amount thereof; that the estate of John Sutcliffe deceased having 
 been insufficient to allow plaintiff to make the said- payments out of it, 
 plaintiff was obliged to advance out of his own monies, and did ad^_ 
 vance, a large sum, to wit £140, for the purpose of the said expendi- 
 ture; and, in order to reimburse himself, was obliged to borrow, and 
 did borrow, the said sum of one A. Blackburn, and, as a security, 
 made his promissorj' note for payment thereof to the said A. Black- 
 burn or his order on demand with interest; which sum, so secured 
 by the said promissory note, v/as at the time of the making thereof 
 and still is wholly due and impaid to the said A. Blackburn ; that the 
 said sum was expended by plaintiff in manner aforesaid for the bene- 
 fit of the said Sarah Sutcliffe, who received all the benefit and advan- 
 tage thereof, and such expenditure was useful and beneficial to her to 
 the full amount thereof; that when the said Sarah Sutcliffe came of 
 full age she had notice of the premises, and then assented to the loan 
 so raised by plaintiff, and thfe security so given by him, and requestea 
 plaintiff to give up to one J. Stansfield as her agent, the controul and 
 management of the said property, and then promised the plaintiff to 
 pay and discharge the amount of the said note ; and thereupon caused 
 one year's interest upon the said sum of £140 to be paid to A. Black- 
 bum. That thereupon plaintiff agreed to give up, and did then give 
 up, the controul and management of the property to the said agent on 
 behalf of the said Sarah Sutcliffe; that all the services of plaintiff 
 were done and given by him for the said Sarah Sutcliffe, and for her 
 benefit, gratuitously and without any fee, benefit, or award whatever; 
 and the said services and expenditure were of great benefit to her, 
 and her said property was increased in value by reasdn thereof to an 
 amount far exceeding the said il40. That afterwards defendant in- 
 termarried with the said Sarah Sutcliffe, and had notice of the prem- 
 ises, and the accounts of plaintiff of and concerning the premises were 
 then submitted to defendant, who then examined and assented to the 
 same and upon such accounting there was found to be due to plaintiff 
 a large sum of money, to wit, &c,, for monies so expended and bor- 
 rowed by him as aforesaid ; and it also then, appeared, that plaintiff 
 was indebted to A. Blackburn in the. amount of the said note. That 
 defendant, in right of his. wife, had and received all the benefit and ad- 
 vantage arising from the said services and expenditure. That there- 
 
Sec. 6) PAST CONSIDERATION 395 
 
 upon in consideration of the premises defendant promised plaintiff 
 that he would pay and discharge the amount of the said promissory 
 note ; but that, although a reasonable time for paying and discharging 
 the said note had elapsed and A. Blackburn, the holder thereof, was 
 always willing to accept payment from defendant, and defendant was 
 requested by plaintiff to pay and discharge the amount thereof, de- 
 fendant did not, nor would then, or at any other time pay or discharge 
 the amount, &c., but wholly refused, &c. 
 
 Plea: non assumpsit. 
 
 On the trial before Patteson, J., at the York Spring Assizes, 1838, it 
 was objected on the part of the defendant that the promise stated in the 
 declaration, and proved, was a promise to pay the debt of another 
 within the Statute of Frauds, 29 Car. II, c. 3, § 4, and ought to have 
 been in writing; on the other hand it was contended that such de- 
 fence, if available at all, was not admissible under the plea of non 
 assumpsit. The learned Judge was of the latter opinion, and the 
 plaintiff had a verdict, subject to a motion to enter a verdict for the 
 defendant. 
 
 ■ Cresswell, in the following, term, obtained a rule nisi according to 
 the leave reserved, and also for arresting judgment on the ground that 
 the declaration shewed no consideration for the promise alleged. In 
 Trinity vacation, 1839. 
 
 Alexander and W. H. Watson shewed cause. 
 
 [They argued on the basis of moral obligation because of the faith- 
 ful management by the plaintiff and the pecuniary benefit to the de- 
 fendant and his wife. Cresswell in reply, said that moral obligation is 
 sufficient only in cases of infancy, bankruptcy, and the statute of lim- 
 itations as stated in the note to Wennall v. Adney, 3 Bos. & P. 249. 
 He admitted that the defendant might be bound if his wife had been so 
 bound prior to their marriage.] 
 
 Lord Denman, C. J.° * * * The second point arose in arrest 
 of judgment — ^namely, whetlier the declaration showed a sufficient 
 consideration for the promise. It stated, in effect, that the plaintiff 
 was executor under the will of the father of the defendant's wife, who 
 had died intestate as to his real estate, leaving the defendant's wife, 
 an infant, his only child; that the plaintiff had voluntarily expended 
 his money for the improvement of the real estate, while the defend- 
 ant's wife was sole and a minor; and that, to reimburse himself, 
 he had borrowed money of Blackburn, to whom he had given his 
 promissory note; that the defendant's wife, while sole, had received 
 the benefit, and, after she came of age, assented and promised to pay 
 the note, and did pay a year's interest; that after the marriage the 
 plaintiff's accounts were shown to the defendant, who assented to 
 them, and it appeared that there was due to the plaintiff a sum equal 
 to the amount of the note to Blackburn; that the defendant in right 
 
 6 Part of the opinion is omitted. 
 
396 CONSIDERATION (Ch. 2 
 
 of his wife had received all the benefit, and, in consideratipn of the 
 premises, promised to pay and discharge the amount of the note to 
 Blackburn. 
 
 Upon motion in arrest of judgment this promise must be taken to 
 have been proved, and; to have been an express promise, as indeed it 
 must of necessity have been, for no such implied promise in law was 
 ever heard of. It was then argued for the plaintiff that the declaration 
 disclosed a sufficient moral consideration to support the promise. 
 
 Most of the older cases on this subject are collected in a learned note 
 to the case of Wennall v. Adney [3 Bos. & P. 249]":, and the conclu- 
 sion there arrived at seems to be correct in general, "that an ex- 
 press promise can only revive a precedent good consideration, which 
 might have been enforced at law through the medium of an implied 
 promise, had it not been suspended by some positive rule of law ; but 
 can give no original cause of action, if the obligation, on which it is 
 founded, never could have been enforced at law, though not barred 
 by any legal maxim or statute provision." Instances are given of 
 voidable contracts, as those of infants ratified by an express prom- 
 ise after age, and distinguished from void contracts, as of married 
 women, not capable of ratification by them when widows; Loyd v. 
 Lee [ 1 Stra. 94] ; debts of bankrupts revived by subsequent promise 
 after certificate, and similar cases. Since that time some ca^es have 
 occurred upon this Subject, which require to be more particularly .ex- 
 amined. Barnes v. Hedley [2 Taunt. 184] decided that a promise 
 to repay a sum of money, with legal interest, which sum had orig- 
 inally been lent on Usurious terms, but; in taking the account of which, 
 all usurious items had been by agreement struck out, was binding. 
 Lee V. Muggeridge [5 Taunt. 36] upheld an assumpsit by a widow 
 that her executors should pay a bond given by her while a feme cov- 
 ert to secure money then advanced to a third person at her request. 
 On the latter occasion the language of Mansfield, C. J., and of the 
 whole Court of Common Pleas, is very large, and hardly susceptible 
 of any limitation. It is conformable to the expressions used by the 
 judges of this Court in Cooper v. Martin [4 East, 76] where a step- 
 father was permitted to recover from the son of his wife, after he 
 had attained his full age, upon a declaration for necessaries fur- 
 nished to him while an infant, for which, after his full age, he prom- 
 ised to pay. It is remai'kable that in none of these there was any allu- 
 sion made to the learned note in 3 Bosanqu'et & Puller above referred 
 to, and which has been very generally thought io contain a correct 
 statement of the law. The case of Barnes v. Hedley is fully consist- 
 ent with the doctrine in that note laid down. Cooper v. Martin also, 
 when fully examined, will be found not to be inconsistent with it. 
 This last' case appears to have occupied the attention of the Court 
 much more in respect of the supposed statutable liability of a step- 
 father, which was denied by the Court,, and in respect of what a 
 
Sec. 6) PAST CONSIDERATION 397 
 
 court of equity would hold as to a stepfather's liability, and rather 
 • to have assumed the point before us. It should, however, be observed 
 that Lord Ellenborough in giving his judgment says: "The plain- 
 tiff having done an act beneficial for the defendant in his infancy, 
 it is a good consideration for the defendant's promise after he came 
 of age. In such a case the law will imply a request, and the fact of 
 the promise has been found by the jury;" and undoubtedly the ac- 
 tion would have lain against the defendant while an infant, inas- 
 much as it was for necessaries furnished at his request, in regard to 
 which the law raises an implied promise. The case of Lee v. Mug- 
 geridge must, however, be allowed to be decidedly at variance with the 
 doctrine in the note alluded to, and is a decision of great authority. 
 It should, however, be observed that in that case there was an actual 
 request of the defendant during coverture, though not one binding in 
 law ; but the ground of decision there taken was also equally applica- 
 ble to Littlefield v. Shee [2 B. & Ad. 811], tried by Gaselee, J., at 
 N. P., when that learned judge held, notwithstanding, that "the de- 
 fendant having been a married woman when the goods were sup- 
 plied, her husband was originally liable, and there was no considera- 
 tion for the promises declared upon." After time taken for delibera- 
 tion this Court refused even a rule to show cause why the nonsuit 
 should not be set aside. Lee v. Muggeridge was cited on the motion, 
 and was sought to be distinguished by Lord Tenterden, because there 
 the circumstances raising the consideration -were set out truly upon 
 the record ; but in Littlefield v. Shee the declaration stated the consid- 
 eration to be that the plaintiff had supplied the defendant with goods 
 at her request, which the plaintiff failed in proving, inasmuch as it ap- 
 peared that the goods were in point of law supplied to the defend- 
 ant's husband, and not to her. But Lord Tenterden added. that the 
 doctrine that a moral obligation is a sufficient consideration for a 
 subsequent promise is one which should be received with some lim- 
 itation. This sentence, in truth, amounts to a dissent from- the au- 
 thority of Lee V. Muggeridge, where the doctrine is wholly unqital- 
 ified. 
 
 The eminent counsel who argued for the plaintiff in Lee v. Mug- 
 geridge spoke of Lord Mansfield as haying considered the rule of 
 nudum pactum as too narrow, and maintained that all promises 
 deliberately made ought to bc' held binding. I do not find this lan- 
 guage ascribed to him by any reporter, and do not know whether we 
 are to receive it as a traditional report, or as a, deduction from what 
 he does appear to have laid down. If the latter, the note to Wen- 
 nail V. Adney shows the deduction to be erroneous. If the former. 
 Lord Tenterden and this Court declared that they could not adopt 
 it in Littlefield v. Shee. Indeed the doctrine would annihilate the 
 necessity for any consideration at all, inasinuch as the mere fact of 
 giving a promise creates a mpral obligation to perform it. 
 
398 CONSIDERATION (Ch. 2 
 
 The enforcement of such promises by law, however plausibly rec- 
 onciled by the desire to effect all conscientious engagements, might 
 be attended with mischievous consequences to society; one of which 
 would be the frequent preference of voluntary undertakings to claims 
 for just debts. Suits would thereby be multiplied, and voluntary 
 undertakings would also be multiplied, to the prejudice of real cred- 
 itors. The temptations of executors would be much increased by the 
 prevalence of such a doctrine, and the faithful discharge of their duty 
 be rendered more difficult. 
 
 Taking, then, the promise of the defendant, as stated on this rec- 
 ord, to have been an express promise, we find that the considera- 
 tion for it was past and executed long before, and yet it is not laid 
 to have been at the request of the defendant, nor even of his wife 
 while sole (though if it had, the case of Mitchinson v. Hewson [7 
 T. R. 348] shows that it would not have been sufficient), and the dec- 
 laration really discloses nothing but a benefit voluntarily conferred 
 by the plaintiff and received by the defendant, with an express prom- 
 ise by the defendant to pay money. 
 
 If the subsequent assent of the defendant could have amounted to 
 a ratihabitio, the declaration should have stated the money to have 
 been expended at his request, and the ratification should have been 
 relied on as matter of evidence; but this was obviously impossible, 
 because the defei^iant was in no way connected with the property 
 or with the plaintiff, when the money was expended. If the rati- 
 fication of the wife while sole were relied on, then a debt from her 
 would have been shown, and the defendant could not have been 
 charged in his own right without some further consideration, as of 
 forbearance after marriage, or something of that sort; and then an- 
 other point would have arisen upon the Statute of Frauds which did 
 not arise as it was, but which might in that case have been available 
 under the plea of non assumpsit. 
 
 In holding this declaration bad because it states no considera- 
 tion but a past benefit not conferred at the request of the defendant, 
 we conceive that we are justified by the old common law of England. 
 
 Lampleigh v. Brathwait [Hob. 105] is selected by Smith [1 Sm. 
 L. C. 67] as the leading case on this subject, which was there fully 
 discussed, though not necessary to the decision. Hobart, C. J., lays 
 it down that "a mere voluntary courtesy will not have a considera- 
 tion to uphold an assumpsit. But if that courtesy were moved by 
 a suit or request of the party that gives the assumpsit, 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; which is the difference;" a difference brought fully out 
 by Hunt v. Bate [Dyer, 272a], there cited from Dyer, where a prom- 
 ise to indemnify the plaintiff against the consequences of having 
 bailed the defendant's servant, which the plaintiff had done without 
 
Sec. 6) PAST CONSIDEEATION 399 
 
 request of the defendant, was held to be made without considera- 
 tion; but a promise to pay £20 to plaintiff, who had married de- 
 fendant's cousin, but at defendant's special instance, was held bind- 
 ing. 
 
 The distinction is noted, and was acted upon, in Townsend v. 
 Hunt [Cro. Car. 408], and indeed in numerous old books; while 
 the principle of moral obligation does not make its appearance till 
 the days of Lord Mansfield, and then under circumstances not incon- 
 sistent with this ancient doctrine when properly explained. 
 
 Upon the whole, we are of opinion that the rule must be made ab- 
 solute to arrest the judgment. 
 
 Rule to enter verdict for defendant, discharged. ' 
 
 Rule to arrest judgment absolute.® 
 
 ALLEN V. BRYSON. 
 (Supreme Court of Iowa, 1885. 67 Iowa, 591, 25 N. W. 820, 56 Am. Bep. 358.) 
 
 Both parties are attorneys at law, and this action was brought to 
 recover for professional services performed by the plaintiff for the 
 defendant. Trial by jury. Verdict and judgment for the plaintiff, 
 and defendant appeals. 
 
 SeEvbrs, J.' * * * 3. The defendant pleaded that he and the 
 plaintiff were brothers-in-law, and, in substance, that each of them 
 was engaged in the practice of the law, and had been in the habit of 
 assisting each other as a matter of mutual accommodation, and that 
 "all and each of the professional services for which plaintiff seeks to 
 recover in tliis' action were rendered by him as matters of mutual ac- 
 commodation and interchange of courtesies, and without charge or 
 expectation of payment or reward by one as against the other." The 
 court instructed the jury : "If, however, such services were rendered 
 by the plaintiff without expectation of reward, or intention on his part 
 to charge therefor, or by any agreement or understanding that the 
 services were to be gratuitous, the plaintiff cannot recover unless, aft- 
 er such services were rendered, and in consideration thereof, defend- 
 ant agreed with or promised plaintiff to pay for the same. In the lat- 
 ter case the valuable character of the service, and the moral obligation 
 to pay for the sanie, would be a sufficient consideration to support the 
 promise, and enable the .plaintiff to recover the reasonable value of 
 such service." We understand this instruction to mean that where 
 one person renders services for another gratuitously, and with no ex- 
 pectation of being paid therefor, that a moral obligation is incurred 
 by the latter which will support a subsequent promise to pay. In our 
 
 A case similar in several essentials is Parsons v. Teller, 188 N. Y. 318, 80 
 N. E. 930 (ISOT). 
 7 Parts of the opinion are omitted. 
 
400 CONSIDERATION (Gb. 2 
 
 opinion, this is not the law. If the services are gratuitous, no obliga- 
 tioui either moral or legal, is incurred by the recipient. No one is 
 bound to pay for that which is a gratuity. No moral obligation is as- 
 sumed by a person who receives a gift. Suppose the plaintiff had giv- 
 en the defendant a horse, was he morally bound to pay what the horse 
 was reasonably worth? We think not. In such case there never was 
 any Hability to pay and therefore a subsequent promise would be with- 
 out any consideration to support it. That there are cases which hold 
 that where a liabiUty to pay at one time existed, which, because of the 
 lapse of time, ;or for other reasons, cannot be enforced, the moral ob- 
 ligation is sufficient to support a subsequent promise, will be conceded. 
 
 These cases are. distinguishable, because the instructions contem- 
 plate a case where an obligation to pay never existed until the promise 
 was made. We do not believe a case can be found where a moral ob- 
 ligation alone has been held to be a sufficient consideration for a sub- 
 sequent promise. To our minds, however, it is difficult to find a moral 
 obligation to pay anything, in the case contemplated in the instruc- 
 tions, prior to the promise. The following cases support the view 
 above expressed : Cook v. Bradley, 7 Conn. 57, 18 Am. Dec. 79 ; 
 Williams v. Hathaway, 19 Pick. (Mass.) 387; Dawson v. Dawson, 12 
 Iowa, 515; McCarty v. Hampton Building Ass'n, 61 Iowa, 287, .16 
 N. W. 114. * * * 
 
 Reversed.^ 
 
 EDSON V. POPPE. 
 
 (Supreme Covirt of South Dakota, 1910. 24 S. D. 466, 124 N. W. 441, 26 L. 
 
 R. A. [N. S.] 534.) 
 
 Action by George F. Edson against William Poppe. Judgment for 
 plaintiff, and defendant appeals. Affirmed. 
 
 McCoy, J." The plaintiff recovered judgment upon the verdict of a 
 jury in the circuit court. The case was tried upon the following com- 
 plaint: That the defendant at all the times hereinafter named was 
 the owner of the following described premises situated in Turner 
 county, S. D., to wit (describing the land) ; that at all the times herein 
 named George Poppe was in possession of said premises as the ten- 
 ant of defendant; that during the year 1904 this , plaintiff, at the in- 
 
 8 In accord: Gooch v. Gooch, 70 "W. Va. .38, 73 S. E. 56, 37 L. R. A. (N. S ) 
 930 (1911) ; Gooch v. Gooch, 178 Iowa, 902, 160 N. W. 333, L. R. A. 19170 
 582 (1916) ; Stoueburner v. Motley, 95 Va. 784, 30 S. E. 364 (1898). See 53' 
 L. R. A. 353, note. ■ 
 
 In Moore v. EUner, 180 Mass. 15, 61 N. E. 259 (1901), Holmes, J., said: "The 
 modern authorities which speak of services rendered upon request as sup- 
 porting a promise must be confined to cases where the request implies an un- 
 dertaking to pay, and do not mean that what was done as a mere favor can 
 be turned into a consideration at a later time by the fact that it was asked 
 for." 
 
 8 Part of the opinion is omitted. 
 
Sec. 6) PAST CONSIDERATION 401 
 
 Stance and request of said George Poppe, drilled and dug upon said 
 premises a well 250 feet deep, and obtained water in said well, and 
 placed casing therein; that the reasonable value of the ! digging and 
 casing of said well was atid is the sum of $250; that said well was 
 and is a valuable improvement upon the said premises, and greatly 
 adds to the value thereof, and has been used by the occupants of said 
 premises since the said digging thereof, v/ith the knowledge and con- 
 sent of defendant; that on or about the 5th day of August, 1905, the 
 defendant, at the said premises, after having examined the said well, 
 and in consideration of the said well to him, and of the improvement 
 it made upon said premises, expressly ratified the acts of his said 
 tenant in having said well drilled, and then and there promised and 
 agreed to pay plaintiff the reasonable value of the digging and cas- 
 ing of the said well as aforesaid; that defendant has since refused, 
 and Still refuses to pay plaintiff anything for said well. Wherefore, 
 etc. To the said complaint defendant made the following answer: 
 Denies generally and specifically each and every allegation in said 
 complaint, except such as is hereinafter specifically admitted. De- 
 fendant admits that he is the owner of the said premises as stated in 
 the complaint. At the opening of the trial, and upon the offer of tes- 
 timony on the part of plaintiff, defendant objected to the introduction 
 of any evidence, for the reason that the complaint did not state a 
 cause of action, in that the consideration alleged in the contract is a 
 past consideration,, and no consideration for any promise, if any was 
 made, and no consideration for the promise alleged. The objection 
 was overruled, and defendant excepted. This ruling of the trial court 
 is assigned and now urged as error, but we are of the opinion that the 
 ruling of the learned trial court was correct. 
 
 It seems to be the general rule that past services are not a sufficient 
 consideration for a promise to pay therefor, made at a subsequent 
 time, and after such services have been fully rendered and completed ; 
 but in some courts a modified doctrine of moral obligation is adopted, 
 and it is held that a moral obligation, founded- on previous benefits re- 
 ceived by the promisor at the hands of the promisee, v/ill support a 
 promise by him. 9 Cyc. 361; Doty v. Wilson, 14 Johns. (N. Y.) 378; 
 Qatfield v. Waring, 14 Johns. (N. Y.) 188; Glenn v. Savage, 14 Or. 
 567, 1 3 Pac. 442. The authorities are not so clear as to the sufficiency 
 of past services, rendered without previous request, to support an ex- 
 press promise ; but, when proper distinctions are made, the cases as 
 a whole seem to warrant the statement that such a promise is support- 
 ed by a sufficient consideration if the services' were beneficial, and 
 were not intended to be gratuitous. 'Trimble v. Rudy, 53 L. R. A., 
 note p. 373, and cases cited. In Drake v. Bell, 26 Misc., Rep. 237, 55 
 N. Y. Supp. 945, a mechanic, under contract to repair a vacant house, 
 by mistake repaired the house next door, which belonged to the de- 
 fendant. .The repairing was a benefit to the latter, and he agreed to 
 pay a certain amount therefor. It was held that the promise rested 
 
 CORBIN OONT — 26 
 
402 CONSIDERATION (Ch. 2 
 
 upon sufficient consideration. Gaynor, J., says : "The rule seems to 
 be thit a subsequent promise, founded on a former enforceable obli- 
 gation, or on value previously had from the promisee, is binding." 
 In Glenn v. Savage, 14 Or. 567, 13 Pac. 442, it was 'held that an act 
 done for the benefit of another without his request is deemed a vol- 
 untary act of courtesy, for which no action can be sustained, unless 
 after knowing of the service the person benefited thereby promises to 
 pay for it. In Boothe v. Fitzpatrick, 36 Vt. 681, it is held that if the 
 consideration, even without request, moves directly from the plaintiff 
 to the defendant, and inures directly to the defendant's benefit, the 
 promise is binding though made upon a past consideration. In this 
 case the court held that a promise by defendant to pay for the past 
 keeping of a bull, which had escaped from defendant's premises and 
 been cared for by plaintiff, was valid, although there was no previous 
 request, but that the subsequent promise obviated that objection; it 
 being equivalent to a previous request. The allegation of the com- 
 plaint here is that the digging and casing of the well in question inured 
 directly to the defendant's benefit, and that, after he had seen and ex- 
 amined the same, 'he expressly promised and agreed to pay plaintiff 
 the reasonable value thereof. It also appears that said well was made 
 under such circumstances as could not be deemed gratuitous on the 
 part of plaintiff, or an act of voluntary courtesy to defendant. We 
 are therefore of the opinion that, under the circumstances alleged, the 
 subsequent promise of defendant to pay plaintiff the reasonable value 
 for digging and casing said well was binding, and supported by suf- 
 ficient consideration. We are also of the opinion that the instructions 
 based on this complaint, and in particular as to the validity of the 
 subsequent promise of defendant, properly submitted the issues to the 
 jury. * * * 
 
 Finding no error in the record, the judgment of the circuit court is 
 affirmed.^" 
 
 SHARP V. HOOPES. 
 (Supreme Court of New .Jersey, 1906. 74 N. J. Law, 191, 64 Atl. 989.) 
 
 Action by Lewis H. Hoopes against Joseph T. Sharp. Judgment 
 for plaintiff, and defendant appeals. Reversed. 
 
 Reed, J. Hoopes, the plaintiff below, sued to recover commission 
 as a real estate agent for securing a tenant for a house belonging to 
 Sharp. Mr. Hoopes met a lady who wished to rent a house. He seems 
 
 10 In accord:' Spencer v. Potter's Estate, 85 Vt 1, 80 Atl. 821 (1911) • Hicks 
 V. Burhans, 10 Johns. (N. Y.) 242 (1813); Jilson v. Gilbert, 26 Wis 637 7 
 Am. Rep. 100 (1870) ; Hatch v. Purcell, 21 N. H. 544 (1850) ; Wilson y. Ed- 
 monds, 24 N. H. 517 (1852) ; Montgomery v. Downey, 116 Iowa, 632 88 N W 
 810 (1902) ; Boothe v. Fitzpatrick, 36 Vt. 681 (1864) ; Seymour v. Town of 
 Marlboro, 40 Vt. 171 (1868) ; Landis v. Eoyer, 59 Pa. 95 (1868) ; Wright v 
 Farmers' Nat. Bank, 31 Tex. Civ. App. 400, 72 S. W. 103 (1903). : 
 
Sec. 6) PAST CONSIDERATION 403 
 
 to have known that Mr. Sharp had a, house for rent. He went to the 
 residence of a daughter of Mr. Sharp and there saw Mrs. Sharp, the 
 wife of the defendant below, and got from her the amount of rental 
 asked for the house. He then took the prospective tenant, Mrs. John- 
 son, to the house, then in the occupation of another tenant, and ex- 
 hibited the same to Mrs. Johnson. Mr. Hoopes never saw or commu- 
 nicated with Mr. Sharp but afterwards Mrs. Johnson saw' Sharp and 
 rented the property directly from him. There had, therefore, been no 
 employment of Hoopes by Sharp directly or indirectly in the. trans- 
 action. 
 
 The trial court charged the jury that there was no evidence of any 
 employment of Hoopes by Sharp, so that question was not passed upon 
 by the jury. The court told the jury that the only point for their con- 
 sideration was whether Mr. Sharp, after the renting, confirmed and rati- 
 fied Hoopes' acts and agreed to pay him a commission therefor. The 
 only testimony upon which a promise or ratification rested is that of 
 the plaintiff. He says that after the renting he met Mr. Sharp, and 
 "I told him I undeirstood the house was rented by the party I intro- 
 duced, and of course I expected a commission. He, Sharp, told me to 
 see Mrs. Johnson, and if she would iiot pay, he supposed he would have 
 to." Mr. Sharp admits the conversation, but says the language was 
 that "If Mrs. Sharp piit it in Hoopes' hands, he supposed he would have 
 to pay it." The language of Mr. Sharp, if conceded to have been as 
 Hoopes asserts, did not ratify any contract of employment, because 
 no one had employed Hoopes, purporting to represent Sharp. The 
 language, if it amounted to i promise to pay at all, which is not ad- 
 mitted, did not ratify any contract, but was a new promise to pay 
 Hoopes for service previously rendered, without any request ex- 
 pressed or implied. Such a promise was devoid of any consideration 
 to support it. In Lampleigh v. Brathwait, 1 S. L. C. marg. p. 264, it 
 was resolved that a mere voluntary courtesy will not have a considera- 
 tion to uphold an assumpsit. The same doctrine is asserted in East- 
 wood V. Kenyon, 11 Adol. & Ell. 438, also reported in 6 Eng. Rul. 
 Cases, p. 23, and notes thereto. There must have been, at the time 
 of the promise, some perfect or imperfect legal liability to support the 
 promise. A mere moral liability will not furnish a consideration. 
 Bartholomew v. Jackson, 20 Johns. (N. Y.) 28, 11 Am. Dec. 237; 
 Chamberlin v. Whitf ord, 102 Mass. 448 ; Freeman v. Robinson, 38 N. 
 J. Law, 383,' 20 Am. Rep. 399. 
 The judgment should be reversed. 
 
404 CONSIDEEATION (Ch. 2 
 
 ROSC0RI.A V. THOMAS. 
 (In the Queen's Bench, 1842. 3 Q. B. 234.) 
 
 Assumpsit. The declaration stated that, whereas heretofore, to 
 wit, etc., in consideration that plaintiff, at the request of defendant, 
 had bought of defendant a certain horse, at and for a certain price, 
 etc., to wit, 'etc, defendant promised plaintiff that the said horse did not 
 exceed five years old, and was sound, etc., and free from vice; nev- 
 ertheless defendant did not perform or regard his said promise, but 
 thefeby deceived and defrauded plaintiff in this, to wit, that the said 
 horse, at the time of the making of the said promise, was not free 
 from vice, but, on the contrary thereof, was then very vicious, res- 
 tive, ungovernable, and ferocious ; whereby, etc. 
 
 Pleas: 1. Non assumpsit. Issue thereon. 
 
 2. That the horse, at the time of the supposed promise, was free 
 from vice, and was not vicious, restive, ungovernable or ferocious, in 
 manner, etc. ; conclusion to the contrary. Issue thereon. 
 
 On the trial, before Wightman, J., at the Cornwall Spring Assizes, 
 1841, a verdict was found for the plaintiff on both the above issues. 
 In Easter Term, 1841, Bompas obtained a rule nisi for arresting the 
 judgment on the first count. 
 
 Lord Denman., C. J., in this term (May 30th) delivered the judgment 
 of the pourt. 
 
 This was an action of assumpsit for breach of warranty of the 
 soundness of a horse. The first count of the declaration, upon which 
 alone the question arises, stated that, in \ consideration that the plain- 
 tiff, at the request of the defendant, had bought of the defendant a 
 horse for the sum of £30, the defendant promised that it was sound 
 and free from vice. And it was objected, in arrest of judgment, that 
 the precedent executed consideration was insufficient to support the 
 subsequent promise. And we are of opinion that the objection must 
 prevail. 
 
 It may be taken as a general rule, subject to exceptions not ap- 
 plicable to this case, that the promise must be co-extensive with the 
 consideration. In the present case, the only promise that would re- 
 sult from the consideration, as stated, and be co-extensive with it, would 
 be to deliver the horse upon request. The precedent sale, without a 
 warranty, though at the request of the defendant, imposes no other 
 duty or obligation upon him.' It is clear therefore, that the consid- 
 eration stated would not raise an implied promise by the defendant 
 that the horse was sound or free from vice. 
 
 But the promise in the present case must be taken to be, as in 
 fact it was, express ; and the question is, whether that fact will war- 
 rant the extension of the promise beyond that which would be implied 
 by law ; and whether the consideration, though insufficient to raise an 
 implied promise, will nevertheless support an express one. And we 
 think that it will not. 
 
Sec. 6) PAST CONSIDERATION 405 
 
 The cases in which it has been held that, under certain circumstances, 
 a consideration insufficient to raise an implied promise will never- 
 theless support an express one, will be found collected and reviewed 
 in the note to Wennall v. Adney [3 Bos. & P. 249], and in the case 
 of Eastwood V. Kenyon [11 A. & E. 438]. They are cases of vbidable 
 contracts subsequently ratified, of debts bari-ed by operation of law, 
 subsequently revived, and of equitable and moral obligaitions, which, 
 but for some rule of law, would of themselves have been sufficient 
 to raise an implied promise. All these cases are distinguishable from, 
 and indeed inapplicable to, the present, which appears to us to fall 
 within the general rule, that a consideratioh past and executed will 
 support no other promise than such as would be implied by law. 
 
 The rule for arresting the judgment upon the first count must there- 
 fore be made absolute. 
 
 Rule absolute.^^ 
 
 EDMONDS' CASE. 
 
 (In the Common Pleas, 1587. 3 Leon. 164.) 
 
 In an action upon the case against Edmonds, the case was, that 
 the defendant being within age, requested the plaintiff to be bounden 
 for him to another, for the payinent of £30 which he was to borrow 
 for his own use; to which the plaintiff agreed, and was bounden, ut 
 supra, afterwards, the plaintiff was sued for the said debt, and paid 
 it; and afterwards, when the defendant came of full age, the plain- 
 tiff put him in mind of the matter aforesaid, and prayed him that he 
 might not be damnified so to pay £30 it being the defendant's debt: 
 whereupon the defendant promised to pay the debt again to the plain- 
 tiff : upon which promise, the action was brought. And it was holden 
 by the Court, that although here was no present consideration upon 
 which the assumpsit could arise ; yet the Court was clear, that upon the 
 whole matter the action did lie, and judgment was given for the 
 plaintiff.^ ^ ,i 
 
 11 In accord: Hatcliell y. Odom, 19 N. C. 302 (1837) ; Watson v. Roode, 30 
 Neb. 264, 46 N. W. 491 (1890); Davis & Co. v. Morgan, 117 Ga. 504', 43 S. E. 
 732, 61 L. R. A. 148, 97 Am. St. Rep. 171 (1903), ante, 344; lilmbro v. Wells, 
 112 Ark. 126, 165 S. W. 645 (1914), two hours after sale of a business the seller 
 added a written promise not to compete ; Warren v. Weaver, 78 N. H. 108, 97 
 Atl. 748 (1916) ; Sommers V. Myers, 69 N. J. LaW, 24, 54 Atl. 812 (1903) ; Bal- 
 timore Refrigerating & Heating Co. of Baltimore City v. Wetzel, 162 Fed, 117, 
 89 C. C. A. 117 (1908) ; and seei notes in 53 L. R. A. 358, 26 L. E. A. (N. S.) 
 523. Contra: BricKell v. Hendricks, 121 Miss. 35iS, 83 South. 609 (1920). 
 
 In Meginnes v. McChesney, 179 Iowa, 563,' 160 N.' W. 50, L. E. A. 1917E, 
 1060 (1916), the court held that a promissory note given as added compensa- 
 tion for services as a nurse, who had already received the agreed salary, was 
 not enforceable being "utterly without consideration." 
 
 12 Also reported as Barton, and E'dmunid's Case, 4 Leon. 5. , 
 
 In Sto^e V. Wjthepoole, Owen, 94 (1588), it was held that a promise by the 
 executor of an infant to pay a debt of the infant was not blinding, , 
 
 By the Roman law (Dig. 39, '5, 19, § 4), where a loan h;id been made to'a 
 
406 CONSIDERATION (Cb. 2 
 
 WILLIAMS V. MOOR. 
 (In the Court of Exchequer, 1843. 11 Mees. & W. 256.) 
 
 Debt for work and materials, for goods sold and delivered, for in- 
 terest, and for money due on an account stated. 
 
 Plea, infancy. 
 
 Replication, that the defendant, before the commencement of the 
 suit, to wit, on the 10th day of December, 1837, attained his full age 
 of twenty-one years, and before the commencement of the suit, to 
 wit, on the 27th September, 1839, in writing then signed by him, as- 
 sented to and ratified and confirmed the said contract in the declara- 
 tion mentioned, and then agreed to pay the plaintiff the said moneys 
 therein mentioned. — Verification. 
 
 To this replication the defendant demurred on the following 
 grounds, viz., that an action on an account stated did not lie against 
 an infant; that the replication stated that the defendant was an in- 
 fant at the time of stating the account, and that an infant, though he 
 state an account cannot be sued upon it; that an infant could not 
 ratify such a contract after he came of age or be liable in consequence 
 of such subsequent ratification on an account stated by him when he 
 was a minor ; that the action should have been brought in assumpsit, 
 and not debt: that an infant is not liable for interest. . 
 
 Joinder in demurrer. 
 
 Parke, B. This was an action of debt on the common counts for 
 work and materials, and for goods sold and delivered, with a count 
 on an account stated. 
 
 Plea, that at the time of making the alleged contracts, defendant 
 was an infant. Replication, that, after defendant attained his age of 
 twenty-one years, and before the commencement of the suit, he rati- 
 fied and confirmed the said contract. To this replication there was a 
 demurrer, on the ground that an account stated by an infant is abso- 
 lutely void, and that no subsequent ratification of it, after the infant 
 has attained his age of twenty-one years, will set it up, so as to enable 
 the other party to the account to sue upon it. It is not necessary that 
 we should decide what is the precise legal operation of the ratification 
 by a party who has attained his age of twenty-one years, of a con- 
 tract entered into during his minority; whether it is to be treated as 
 an act giving validity to an otherwise invalid contract, or as a new 
 contract voluntarily entered into after the party has obtained the ca- 
 pacity of contracting, the consideration being the moral duty arising 
 from the previous transactions. The course of pleading in this case, 
 following that which was adopted in Cohen v. Armstrong, 1 M. & 
 
 slave or an infant, a new. promise by the borrower after emancipation, was 
 valid, and was not regarded as a donation, but as based upon causa. "Si 
 quis servo pecuniam crediderit, deinde is liber f actus earn expromiserit: non 
 erit donatio, sed debiti solutio. Idem in pupillo, qui sine tutoris auctoritate 
 debuerit, dicendum est, si postea tutore auctore promittat." 
 
Sec. 6) PAST CONSIDERATION 407 
 
 Selw. 724, Thornton v. Iliingworth, 2 B. & Cr. 824, and Haftley v. 
 Wharton, 9 Ad. & El. 934, (which last, like the present, was an ac- 
 tion of debt,) would rather seem to indicate that the effect of ratifica- 
 tion is to set up and give validity to the otherwise invalid contract — 
 to remove the bar of infancy. On the other hand, that which is point- 
 ed out by the Court of King's Bench, in the above mentioned case of 
 Cohen v. Armstrong, as the old form of pleading, would lead to the 
 inference that in such a case as the present the liability of the defend- 
 ant arises wholly on a new contract, made after he has attained his 
 age of twenty-one years. [See what was said by Lord Mansfield, in 
 Hawkes v. Saunders, Cowp. 290, and by Lord Holt in Heyling v. 
 Hastings, 1 Ld. Raym. 389; and see Comberbach, 381.] 
 
 Whichever form of pleading is adopted, and whatever be the precise 
 legal nature of ratification, it is clear that on a declaration for goods 
 sold and delivered only, without any count on an account stated, the 
 ratification by the defendant after he has attained his majority will 
 entitle the plaintiff to recover. 
 
 But the argument on behalf of the defendant was, that the case is 
 different in an action on an account stated ; for that an account stat- 
 ed by an infant is not merely voidable, but actually void, so' that no 
 subsequent ratification can make it of any avail. But we can see no 
 sound or sensible distinction in this respect between the liability of an 
 infant on an account stated^ and his liability for goods sold and deliv- 
 ered, or on any other contract. 
 
 The contract of an infant for goods sold and delivered (not being 
 necessaries) is as completely void as his contract on an account stat- 
 ed, if by the word "void" is meant incapable of being enforced. The 
 plea of infancy will be a bar to any demand 'on the one contract as 
 well as on the other. But if by "void" is meant incapable of being 
 ratified, then we can discover neither principle nor authority for the 
 distinction relied on. 
 
 The principle on which the law allows a party who has attained his 
 age of twenty-one years to give validity to contracts entered into dur- 
 ing his infancy is, that he is supposed to have acquired the power of 
 deciding for himself, whether the transaction in question is one of a 
 meritorious character, by which in good conscience he ought to be 
 bound; and there seems nothing in the liability on an account stated 
 to take that out of this general principle. It was indeed argued for the 
 defendant, that on an account stated an infant derives no benefit ; that 
 he does not, as on a purchase of goods, get any thing valuable; that 
 he has no quid pro quo. But this is a fallacy; an infant stating an 
 account gets precisely the same benefit as an adult gets on a similar 
 transaction. He makes certain the previously uncertain state of 
 transactions between himself and the person with whom he is stating 
 accounts, and he gets rid of the necessity of preserving vouchers. 
 This, in the case of an adult, is a sufficient consideration to preate a 
 debt ; and we can discover no reason why it should not have the same 
 
108 CONSIDERATION (Ch. 2 
 
 effect in the case of an infant, supposing him to adopt' and ratify it 
 after he comes of age. 
 
 If an infant, having had dealings with an adult, meets and settles 
 accounts with him during his infancy, in the ordinary way, and a bal- 
 ance is struck and vouchers destroyed, he does that which certainly 
 creates no legal liability on his part. But if on attaining his age of 
 twenty-one years, he is satisfied of the fairness of the settlement, 
 there seems to us to be just the same reason why he should be per- 
 mitted to confirm that settlement and render himself liable for the ba.1- 
 ance, as there is for enabling him to make himself liable on any oth- 
 er contract entered into during his infancy. The same principle ap- 
 plies as in the case of work and labour, or goods sold and delivered. 
 
 Neither do the cases cited by the defendant at all bear out his prop- 
 osition. It is undoubtedly shown very clearly, by the early authorities, 
 to which we were referred, that an infant cannot state on account so 
 as to bind himself. But so neither can he render himself liable on any 
 other contract not for necessaries. 
 
 The case of Trueman v. Hurst, 1 T. R. 40, was an action of as- 
 sumpsit on an account stated — plea infancy — replication, that the 
 promises were for necessaries. The replication was held bad on de- 
 murrer, and on very satisf actor)' grounds ; for an account stated can- 
 not possibly be itself described as coming under the head of neces- 
 saries : and the question, whether the items of which the account con- 
 sists be made up of necessaries, is by the very statement of account 
 itself excluded from the view of the Court, although that is in truth 
 on such a replication the only question to be decided. The Court 
 therefore most properly held that replication bad. Exactly the same 
 observation applies to the case of Bartlett v. Emery, referred to by 
 Mr. Justice Buller, and mentioned in the note to Trueman y. Hurst. 
 But in neither of those cases was the point raised, whether an account 
 stated was void against an infant in any sense which would render 
 it impossible for him to set it up by ratification after he came of age. 
 The authorities referred to, therefore, certainly do not bear out the 
 proposition of the defendant ; and we have already stated that we do 
 not think it rests on any sound principle of law. 
 
 The general doctrine is, that a party may, after he attains his, age 
 of twenty-one years, ratify, and so make himself liable on contracts 
 made during infancy. We think that, on principle unopposed by au- 
 thority, this may be done on a contract arising on an account stated, 
 as well as on any other contract. Judgment must therefore be for the 
 plaintiff. 
 
 Judgment for the plaintiff. 
 
 His Lordship afterwards added: "Whether this replication 
 amounts in fact to a new assignment, or is improperly pleaded by 
 way of replication, is not in question,, as it is not pointed out as a 
 ground of special demurrer." ^* 
 
 "In Kdniunds V. Mister, 58 Miss. 765 (1881), the court said: "It is an 
 anomaly in pleading that the plaintiff declares upon the original contract, 
 
Sec. 6) PAST CONSIDISKATION 409 
 
 MERRIAM et al. v. WILKINS et al. 
 (Supreme Court of New Hampshire, 1833. 6 N. H. 432, 25 Am. Dec. 472.) 
 
 Assumpsit for goods sold and delivered. The cause was tried in the 
 common pleas, at September term, 1833, and a verdict taken for the 
 plaintiffs, subject to the opinion of this court, on the~ following case. 
 
 The goods mentioned in the declaration were sold, and delivered 
 to the defendants by the plaintiffs, but at the time of the sale Erastus 
 Wilkins was an infant, under the age of twenty-one years. But to 
 obviate the objection of his infancy the plaintiffs proved, that, after 
 the commencement of this action, and after Erastus arrived at the age 
 of twenty-one years,, he declared that he would not take advantage 
 of his infancy in the action. 
 
 Richardson, C. J., delivered the opinion of the court. 
 
 We are of opinion that this action cannot be sustained against Eras- 
 tus Wilkins. In Wright v. Steele, 2 N. H. 51, it was decided, that a 
 promise made after the commencement of the action, and after the 
 minor arrived at the age of twenty-one years, might be considered as a 
 waiver of the defence of infancy so that the contract might be consider- 
 ed as valid from the beginning. But this view is sustained by no other 
 authority, and cannot be reconciled with what must now be considered 
 as settled principles of law on this subject. 
 
 It was supposed in that case that there was a close analogy between 
 the case of a debt taken out of the statute of limitations by a new prom- 
 ise, and a contract of an infant ratified by a promise made after he 
 comes of age; and that this analogy was close enough to sustain 
 that decision. But there is, in truth, no analogy between the two cases. 
 In the. case of the statute of limitations the new promise does not 
 create a new cause of action, but shields an old one from the opera- 
 tion of the statute. 
 
 But in the case of infancy there is no cause of action until the con- 
 tract is ratified after the infant arrives at an age when the law allows 
 him to bind himself by a contract. 2 B. & C. 824, Thornton v. Illing- 
 worth; 1 Pick. (Mass.) 202, Ford v. Phillips. 
 
 , The contract of an infant to pay for goods, sold and delivered to him, 
 is, unless the goods are necessaries, no foundation for an action. The 
 delivery of the ^oods may be a moral consideration which will sus- 
 tain a promise to pay for them, made after he comes of age. But such 
 promise cannot relate back, upon any principle with which we are ac- 
 quainted, so as to make thp original contract a good foundation for an 
 
 and to a plea of infancy replies the new promise, -svhile all the authorities 
 detiare that the recovery is not upon the original contract, but upon the new 
 promise ; and yet undoubtedly the anomaly exists." 
 
410 CONSIDERATION 
 
 (Ch.2 
 
 action from the beginning. There is no legal cause of action until 
 the contract is ratified. 
 
 In this case the plaintiffs may enter a nolle prosequi as to the m- 
 fant, and take judgment on the verdict against the other defendant." 
 
 EDGERLY v. SHAW. 
 (Supreme Court of New Hampshire, 1852. 25 N. H. 514, 57 Am. Dec. 349.) 
 
 Assumpsit upon a promissory note, made by the defendant while 
 an infant, payable to John Barker, or order, and by him indorsed to 
 the plaintiff, without recourse. The declaration follows the usual 
 form of declaring upon indorsed notes. 
 
 The plaintiff called Barker to prove a new promise after the de- 
 fendant became twenty-one years of age. * * * He testified that 
 while he held and owned the note, he told the defendant, who is a 
 joiner, that he was about having some work done, and he wished the de- 
 fendant would come and pay him. The defendant answered that he 
 was then engaged to others, but that at the end of six weeks he 
 would come and work for him at a dollar a day, and thus pay him, 
 or else he would pay him in money, but he never did any work for 
 Barker. The defendant objected- that this promise would not enable 
 the plaintiff to maintain the suit, and a verdict was taken for the plain- 
 tiff, subject to the opinion of the court upon the exception. 
 
 Gilchrist, C. J.^'"' The executory contract of an infant may be 
 ratified or confirmed by an express promise, or by such acts as evince 
 an intention to be bound by it. Hoit v. Underbill, 9 N. H. 436, 32 
 Am. Dec. 380; Aldrich v. Grimes, 10 N. H. 194. But a mere ac- 
 knowledgment is not enough. Hale v. Gerrish, 8 N. H. 376; Millard 
 V. Hewlett, 19 Wend. (N. Y.) 301 ; Thompson v. Lay, 4 Pick. (Mass.) 
 48, 16 Am. Dec. 325. The case of a promissory note rests on the same 
 ground as other executory contracts. It is not void, because it may 
 be confirmed; but it is invalid, that is, without binding force, until 
 it is confirmed. Merriam v. Wilkins, 6 N. H. 432, '25 Am. Dec. 472 ; 
 Conn V. Coburn, 7 N. H. 368, 26 Am. Dec. 746 ; Aldrich v. Grimes, 
 supra; Reed v. Bachelder, 1 Mete. (Mass.) 559. The executory con- 
 tracts of an infant are said to be voidable, but this word is used in 
 a sense entirely different from that in which it is applied to the 
 executed contracts of an infant. In the latter case, the contract is 
 binding until it is avoided by some act indicating that the party 
 
 li "Accord: Thornton v. Illingworth, 2 B. & C. 824 (1824) ; Ford v Phil- 
 lips, 1 Pick. (Mass.) 202 (1822) ; Freeman v. Nichols, 138 Mass. 313 (1885) • 
 Hyer v. Hyatt, 3 Cranch, C. O. 276, Fed. Gas. No. 6,977 (1827). Contra- Wright 
 V. Steele, 2 N. H. 51 (1819) ; Best v. Givens, 3 B. Hon. (Ky.) 72 (1842)." Kales' 
 Cases on Persons, 132. 
 
 1° Part of the opinion is Omitted. 
 
Sec. 6) PAST CONSIDEEATION 4:11 
 
 refuses longer to be bound by it. In the former, case, it is meant merely 
 that the contract is capable of being confirmed or avoided, tliough it is 
 invalid until it has been ratified. 
 
 In the present case, the proof relied on to show a ratification, is 
 of an express promise. It is, therefore, unnecessary to refer to any 
 of the other modes of ratification which are discussed in the books. 
 An express promise to pay a debt or perform an agreement, contracted 
 or entered into during minority, may be partial, qualified or condition- 
 al. And the effect of such promises as a ratification of a previous 
 agreement, is by no means the same. 
 
 As to the absolute promise, no question can arise. The partial 
 promise, or the promise to pay, or perform a part of the original debt 
 or agreement, is binding only to the extent of the new promise, and 
 is not a ratification of the original debt, but a new and distinct prom- 
 ise, though f oimded upon the original consideration. 
 
 A new promise may be qualified in various ways. It may bind 
 the promisor to pay the debt at a different time or place from those 
 originally stiptilated. It may be a promise to pay, not in money, but 
 in specific articles, or in personal services. These cases cannot be dis- 
 itinguished, in principle, from that last stated. They' are new con- 
 tracts, not ratifications of the old ones. 
 
 When a contract which requires confirmation is confirmed, it takes 
 effect from its date, or from the time of malcing it. But this can- 
 not be the case as to an agreement which contains new stipulations, 
 not comprised in the original agreement. Among the many advan- 
 tages of an observance of the rules of pleading, is to be remarked the 
 precision with which they indicate the exact point in controversy. 
 And in whatever form the question may arise, we can see at once 
 the material points involved, by supposing the questions to be raised 
 by the pleadings. When infancy is pleaded to a declaration upon a 
 contract, the replication, if the plaintiff would avail himself of a 
 ratification or new promise, [should be] that the defendant, after the 
 making of the said promises in the declaration mentioned, and be- 
 fore the commencement of the suit, to wit, on, &c., attained his age 
 of twenty-one years, and after he had so attained, &c., and before 
 the commencement of the suit, to wit, on, &c., assented to, and then 
 and there ratified and confirmed the said promises in the declaration 
 mentioned, &c. 2 Ch. PI. 595; Story's PI. 150. The rejoinder is, 
 that the defendant did not, after he attained the age of' twenty-one 
 years, and before the commencement of the suit, assent to, ratify and 
 confirm the said promises in the declaration mentioned, or either 
 of th^m, in manner and form, &c. 2 Ch. PI. 659 ; Story's PL' 150. 
 Upon'these pleadings, it is apparent that the point to be tried and de- 
 termined is merely whether the . defendant confirmed the promises 
 declared on. Evidence that he made any other or different agreement, 
 would not support the replication, any more than it would support the 
 
412 gONSIDERATION ' (Ch. 2 
 
 origini.1 declaration. In such cases, it is clear that the new contract 
 is valid, and it has never been denied that the original consideration 
 is sufficient to support it ; but being a new and different contract, it 
 must be stated and declared on according to the facts and the evidence 
 to sustain it. 
 
 Within the class of qualified promises in renewal of contracts en- 
 tered into by an infant, are the cases bf new promises, to be per- 
 formed upon a condition »r a contingency. They are distinguishable 
 from other cases of qualified promises, by the nature of the qual- 
 ification. So long as the contingency remains, or the condition is 
 unperformed, they are qualified contracts, governed by the same rules 
 as the class last re>ferred to. They may be declared upon and an action 
 maintained upon them, but the contract offered in evidence is not that 
 originally made. It differs from it in substantial particulars. If 
 the plaintiff declare upon the original cause of action, and allege 
 a confirmation of the original contract, he will fail, because his proof 
 will show a new and distinct contract, and not an affirmance of the 
 old one. The evidence would, in fact, prove a refusal to ratify the 
 original agreement. If the defendant promise to pay in goods, it 
 will be equivalent to saying, "I will not pay you in money, but I will 
 pay you in goods," thus proposing to substitute a new contract for the 
 old one. 'If he should say, "I will pay yOu in three years," or "when I 
 am able," he will, in substance, decline to pay when the plaintiff re- 
 quests it. 
 
 If a new promise be made to pay or perform a contract made un- 
 der age, upon a • contingency or a condition, no action will lie until 
 the happening of the contingency or the performance of the con- 
 dition, for the old contract will not until that time have been con- 
 firmed, and the new agreement is distinct from it ; and of that, in the 
 case supposed, there will then have be^n no breach. When the con- 
 tingency has happened, or the condition is fulfilled, the new contract 
 becomes absolute, the original contract is ratified, and the plaintiff 
 may, declare upon it, or upon the new agreement. If he. declare upon 
 the original contract, and infancy be pleaded, he may reply a confir- 
 mation, and upon proper evidence he will be entitled to recover. Or 
 he may declare upon the new promise, and set it forth with the neces- 
 sary averments ; and upon sufficient proof, will be entitled to recover 
 in that case. * * * 
 
 In Thompson v. Lay (1826) 4 Pick. (Mass.) 48, 16 Am. Dec. 
 325, Parker, C. J., states the law thus: "A ratification may be ab- 
 solute or conditional. If it be the latter, the tenns of the condition 
 must have happened or been complied with before an action can be 
 sustained. I ratify and confirm my promise, provided I receive a cer- 
 tain legacy, or if I succeed to a certain estate, or if I recover a certain 
 sum of money, or if I draw a prize in a certain lottery, would make a 
 conditional promise or ratification sufficient to make the defendant lia- 
 
Sec. 6) PAST CONSIDERATION 413 
 
 ble on a contract made when a minor, when the events happen, but 
 not before." 
 
 In the case before us, the defendant, on being asked by the plain- 
 tiff to pay, said that at the end of six weeks he would come and 
 work for him, at a dollar a day, or else he would pay him the money. 
 This was a qualified promise to pay, dependihg on a contingency. 
 For the period of six weeks the defendant reserved to himself the 
 right to pay in labor, at a dollar a day. During .that time it was 
 contingent whether his promise to pay the money would become bind- 
 ing, and until the expiration of that period, it was uncertain whether 
 the original contract would be confirmed, or the alternative prom- 
 ise would be performed. Until the end of six weeks no action could 
 be brought, either upon the old or the new contract; but after the 
 six weeks had elapsed, after the right reserved by the defendant to pay 
 in labor had ceased, the new promise to pay in money became abso- 
 lute, and the old contract was absolutely confirmed, and the defend- 
 ant was then liable to be sued upon either contract. It does not ap- 
 pear whether the action was brought before or after the expiration of 
 the six weeks. We take it for granted, however, that it was brought 
 after that time. 
 
 The effect of the new promise, after it became absolute, being to 
 ratify and confirm the note, and to give it the same validity as if the 
 promisor had been of legal capacity to make the note at the time of 
 its date, it was from that time at least a good negotiable note, trans- 
 ferable according to its terms, and the action may well be brought in 
 the name of the indorsee. Reed v. Bachelder, 1 Mete. (Mass.) 559. If 
 an action had been brought upon the new promise, it must have been in 
 the name of Barker, because that contract is not negotiable. * * * 
 
 Judgment on the verdict.^* 
 
 LEE V. MUGGERIDGE et al. 
 (In the Common Pleas, 1813. 5 Taunt. 36.) 
 
 Assumpsit. The verdict for the plaintiff estabHshed the following 
 facts : At the request of Mary Muggeridge, a married woman hav- 
 ing a large separate estate, and in reliance upon her penal bond exe- 
 
 18 other cases holding that action ligs^ upon the note given by an infant 
 are Reed v. Batehelder, 1 Mete. (Mass.) 559 (1840) ; Cheshire v. Barrett, 4 
 McCord (S. C.) 241, 17 Am. Dec. 735 (1827). 
 
 Action lies on the original promise of the infant, and, if infancy is pleaded, 
 a replication alleging the new promise made after majority is sufficient to 
 overcome the plea : Hunt v. Massey, 5 B. & Adol. 902 (1834) ; AVest v. 
 Penny, 16 Ala. 186 (1849) ; Hodges v. Hunt, 22 Barb. (N. X.) 150 (1856). 
 Contra: Bliss v. Ferryman, 1 Scam. (111.) 484 (1838). See Kales' Cases oii 
 !P'ersons, 132, and note. 
 
 Where the contract made during infancy was itself without consideration, 
 a new promise based thereon made after maturity will also be void. Par- 
 sons V. Teller, 188 N. Y. 318, 80 N. E. 930 (1907). 
 
414 CONSIDERATION (Ch. 2 
 
 cuted at that time undertaking to repay the money, the plaintiff had 
 loaned ;£2,000 to one J. Hiller, Mary's son-in-law. The money was 
 not repaid, and Mrs. Muggeridge, who meantime had become, a wid- 
 ow and competent to contract, wrote to the plaintiff promising that 
 the debt "would be settled by her executors." Mrs. Muggeridge. died 
 leaving an ample estate, and the defendants are her executors and resid- 
 uary legatees. There was a motion in arrest of judgment on the 
 ground that there was no consideration for the promise of the deceas- 
 ed. A rule nisi was obtained. 
 
 Mansfield, C. J.^'' The counsel for the plaintiff need not trouble 
 themselves to reply to these cases; it ha,s been long 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 uppn this declara- 
 tion there appears a good moral obligation. Now I cannot conceive 
 that there can be a stronger moral obligation than is stated upon this 
 record. Here is this debt of £2,0P0 created at the desire of the tes- 
 tatrix, lent in fact to her, though paid to Hiller. After her husband's 
 death, she knowing that this bond had been given, that her son-in-law 
 had received the money, and had not repaid it; knowing all this, she 
 promises that her executors shall pay ; if then it has been repeatedly 
 decided that a moral consideration is a good consideration for a prom- 
 ise to pay this declaration is clearly good. This case is not distinguish- 
 able in principle from Barnes v. Hedley ; there not only the securities 
 were void, but the contract was void ; but the money had been lent, 
 and therefore when the parties had stripped the transaction of its 
 usury, and reduced the debt to mere principal and interest, the prom- 
 ise made to pay that debt was binding. Lord Mansfield's judgment in 
 the case of Doe on the demise of Carter v. Straphan is extremely ap- 
 plicable. Here in like manner the wife would have been grossly dis- 
 honest if she had scrupled to give a security for the money advanced 
 at her request. As to the cases cited*, of Lloyd v. Lee and Barber v. 
 Fox, there was no forbearance, and those cases proceeded on the 
 ground that no good cause of action was shown on the pleadings. 
 
 GiBBS, J. I agree in this case the plaintiff is entitled to recover. It 
 cannot, I think, be disputed now that wherever there is a moral obli- 
 gation to pay a debt, or perform a duty, a promise to perform that du- 
 ty, or pay that debt, will be supported by the previous moral obliga- 
 tion. There cannot be a stronger case than this of moral obligation. 
 The. counsel for the defendant did not dare to grapple with this posi- 
 tion, but endeavored to show that there was no case, in which a 
 subsequent promise had been supported, whei-e there had not been 
 an antecedent legal obligation at some time or other; from whence 
 be wished it to be inferred, that unless there had been the antecedent 
 legal obligation, the mere moral obligation would not be a sufficient 
 
 1' The facts have been restated and the short concurring opinions of 
 Heath and Chambre, JJ., are omitted. 
 
Sec. 6) PAST CONSIDERATION 415 
 
 consideration to support the promise. But in Barnes v. Hediey, certain- 
 ly Hedley never was for a moment legally bound to .pay a farthing of 
 that money for which he was sued ; for it appears to have been advanc- 
 ed upon a previously existing usurious coritract, and whatever was ad- 
 vanced upon such a contract certainly could not be recovered at any 
 one moment. The borrower, availing himself of the law, so far as he 
 honestly might, and no further, reducing it to mere principal and inter- 
 est, does that which every honest man ought to do in like circum- 
 stances, promises to pay it, and that promise was held binding. As to 
 the cases of Lloyd v. Lee and Barber v. Fox, they have sufficiently 
 been answered by my Lord and my Brother ChamlDre, that if a man 
 will state on his declaration a consideration which is no consideration, 
 and shows no other consideration on his declaration, although another 
 good consideration may exist, when that which he does show fails, he 
 cannot succeed upon the proof of the other which he has not alleged. 
 Now in the first of those cases there was clearly no forbearance, be- 
 caus6 forbearance must be a deferring to prosecute a legal right, but 
 no legal right to recover previously existed. Whatever other consid- 
 eration might exist for the promise, it was not stated in the declara- 
 tion ; it is therefore clear that this rule must be discharged upon the 
 ground, that wherever there is an antecedent moral obligation, and a 
 subsequent promise given to perform it, it is of sufficient validity for 
 the plaintiff to be able to enforce it. 
 Rule discharged.^* 
 
 LITTLE V. BLUNT. 
 (Supreme Judicial Court of Massachusetts, 1830. 9 Pick. 488.) 
 
 Assumpsit.^* The writ was dated December 1, 1828. 
 
 The first, second and third counts were severally on three prom- 
 issory notes, payable to one Somerby on demand, with interest, dated 
 at Newburyport, one on August 29, 1807, another on Septernber 12, 
 1807, and the third on April 26. 1810, and alleged to have been' in- 
 dorsed to the plaintifif each on the day of its date. 
 
 18 In accord : Goulding v. Davidson, 26 N. Y. 604 (1863) ; Sharpless' Appeal. 
 140 Pa. 63, 21 Atl. 289 (1891) . Contra : Holloway's Assignee v. Rudy, 60 S. W. 
 650, 22 Ky. Law Rep. 1406, 53 L. R. A. 853 (1901) ; Waters v. Bean, 15 Ga. 358 
 (1854) ■; Kent v. Rand, 64 N. H. 45, 5 Atl. 760 (1886) ; Putnam v. Tennyson, 
 50 Ind. 456 (1875) ; Musick v. Dodson, 76 Mo. 624, 43 Am. Rep. 780 (1882) ; 
 Condon v. Barr, 49 N. J. Law, 53, 6 Atl. 614 (1886) ; Hay ward v. Barker, 
 52 Vt. 429, 86 Am. Rep. 762 (1880). Lee v. Muggeridge is generally disap- 
 proved in the United States, except where a moral consideration will support 
 a promise. See 53 L. R. A. 366-370, note ; Gilbert v. Brown, 123 Ky. 703, 97 
 S. W 40, 7 L. R. A. (N. S.) 1053 (1906) ; Lyell v. Walbach, 113 Md. 574, 77 
 Atl. nil, 33 L. R. A. (N. S.) 741 (1910). 
 
 The decision was doubted and distinguished in Littlefield v. Shee, 2 B. & 
 Adol. 811 (1831). 
 
 i» Tbe arguments of counsel and parts of the opinion are omitted. 
 
416 CONSIDERATION (Ch. 2 
 
 The fourth, fifth and sixth counts were similar to the -first three, 
 except that the indorsements to the plaintiflE are alleged to have been 
 made on December 20, 1822. 
 
 The defendant pleads, 1, the general issue, which is joined; 2, non 
 assumpsit infra sex annos. 
 
 To the second plea the plaintiff replies, as to the fourth, fifth and 
 sixth counts, that on the 17th of April, 1822, the defendant, in a let- 
 ter written by him at New York to Somerby, promised to pay Somer- 
 by the notes declared on ; that Somerby, after the, receipt of the let- 
 ter, viz. on the 20th of December, 1822, indorsed the notes to the 
 plaintiff; and that always afterward, to wit, from the 17th of April, 
 1822, to the date of the writ, the defendant has been absent from the 
 commonwealth and has had no property within the commonwealth 
 that could by the ordinary process be attached. 
 
 To this replication the defendant demurred generally. 
 
 St. 1786, c. 52, § 4, provides, that if any person, against whom there 
 shall be any cause of suit, was, at the time the same accrued, without 
 the limits of the commonwealth, and did not leave property therein that 
 could by the common and ordinary process of law be attached, the 
 person entitled to bring such suit shall be at liberty to commence the 
 same within the periods before limited in the statute, after such per- 
 son's return into this government. 
 
 Wilde, J., afterward drew up the opinion of the Court. Two ques- 
 tions are raised by these pleadings. The first is, whether the original 
 cause of action was barred by the statute of limitations; and if so, 
 then, secondly, whether this action can be maintained on the new 
 promise made in 1822. * * * 
 
 Then can this action be maintained on the new promise? 
 
 In the replication to the plea to the fourth, fifth and sixth counts, 
 it is averred that this new promise was made on the 17th of April, 
 1822, that always r 'terwards, viz. from the 17th of April, 1822, to 
 the date of the writ, the defendant had been absent from the com- 
 monwealth, arid that he had no property within the state that could 
 by ordinary process be attached. If the defendant had been living 
 within this state at the time this new promise was made, an action no 
 doubt would lie at any time within six years after, and the statute 
 would not operate as a bar. If the defendant in such a case had 
 pleaded, that the cause of action did not accrue within six years be- 
 fore the commencement of the action, the plaintiff might reply that it. 
 did ; and the new promise would support the affirmation of the issue. 
 The reason is, that the new promise is regarded as a new cause of ac- 
 tion upon which the statute operates in th^ same manner, and for the 
 same period of time, as it did before on the original cause of action. 
 Or it may be considered that the original cause of action is revived, 
 and the statute again commences its operation; and this operation is 
 limited by all the exceptions contained in the statute. Indeed the new 
 promise is essentially a new cause of action. In the present case, be- 
 
Sec. 6.) PAST CONSIDERATION 417 
 
 fore the promise in 1822 these demands had been long barred by the 
 statute. 
 
 If the debt remained, the remedy was gone; and there was no sub- 
 sisting cause of action. The new promise therefore was a new cause 
 of action, for without it there was no cause of action. That alone 
 gave the remedy. There was a sufficient consideration for this prom> 
 ise. A debt barred by the statute of limitations is a good considera- 
 tion for an express promise. But it is not necessary to declare on 
 the new promise. According to the established rules of pleading, the 
 plaintiff had a right to declare on the original promise ; and when the 
 statute of limitations was pleaded, he might reply the new promise. 
 When the- pleadings assume this shape, the original promise is appar- 
 ently the cause of action, but it is the new promise alone that gives it 
 vitality ; and that substantially is the cause of action. , * * * 
 
 The defendant is clearly liable to an action on the new promise, and 
 the statute could not be pleaded in bar. Or the plaintiff might amend 
 by transferring the averments in the replication to tlie declaration, and 
 setting forth the original cause of action as the consideration of the 
 new promise. But there is no reason for turning the plaintiff round 
 to a new action, or to require him to amend the declaration. The 
 form of the pleadings cannot vary the construction or operation of 
 the statute. We must regard substance rather than form, and sub- 
 stantially the new promise is the cause of action, whatever may be the 
 form of the declaration. 
 
 Judgment for plaintiff on fourth, fifth, and sixth counts.^" 
 
 CLARK v. JONES. 
 
 (Supreme Judicial Court of Massachusetts, 1919. 233 Mass. 591, 
 124 N. E. 426.) 
 
 BralBy, J. The . master finds that, the defendant having brought 
 action against the plaintiff as maker on certain overdue promissory 
 notes, the parties entered into negotiations for a settlement, and shortly 
 before the return day the plaintiff executed "a note for fourteen 
 hundred and twenty-two dollars," payment of which waS secure^ 
 by mortgage. It is further found that the note and mortgage were 
 executed and duly delivered upon the consideration that the original 
 note or notes were thereby paid and satisfied and the pending suit set- 
 tled. While the master also states that when ^e action was begun 
 
 ="• A new promise made to the assignee, after the assignment, is enforceable- 
 Lamar v. Maiiro, 10 Gill &'J. (Md.) 50 (1838). ' '- 
 
 In Ilsley v. Jewett, 3 Mete; (Mass.) 439 (1841), the court held that the 
 old debt and not the new promise was the real cause of action. This is to be 
 explained on the ground that an intervening statute had enlarged the prison 
 limits for debtors in case of new causes of aiction and the court thought it 
 necessary to choose between the two operative facts, even though it is clear 
 that both are necessary to an enforceable right. 
 
 CORBIN CONT. — 27 
 
418 OONSIDBEATION (Ch. 2 
 
 six years had elapsed since the cause of action accrued and therefore 
 the action had been barred under R. L. c. 202,, § 2, it is plain that the 
 mortgage note cannot be attacked for want of consideration as al- 
 leged in the bill. The remedy indeed had perished, but the debt not 
 having been satisfied, the moral obligafion to pay it afforded a suffi- 
 cient consideiration for the debtor's promise in writing signed by him 
 with the unequivocal intention of liquidating the balance remaining on 
 the old notes, as well as to avoid thfe expense and uncertainty of the 
 litigation. Little v. Blunt, 9 Pick. 488; Chace v. Trafford,'ll6 Mass. 
 529, 17 Am. Rep. 171 ; Shepherd v. Thompson, 122 U. S. 231, 7 Sup. 
 Ct. 1229, 30 L. Ed. 1156; ,R. L. c. 202, § 12; Custy v. Donlan, 159 
 Mass. 245, 247, 34 N. E. 360, 38 Am. St. Rep. 419. The compromise 
 and settlement moreover furnished a sufficient consideration independ- 
 ently of the payment by the new note of the original indebtedness. 
 Kennedy v. Welch, 196' Mass. 592, 596, 83 N. E. 11, and cases there 
 collated. The note and mortgage being valid, the trial court properly 
 refused to enjoin the foreclosure of the mortgage for breach of con- 
 dition, or to order its cancellation for invalidity as prayed for, and the 
 decree dismissing the bill should be affirmed with costs. 
 Ordered accordingly. 
 
 CARSHORE V. HUYCK. 
 (Supreme Court of New Xork, 1849. 6 Barb. 583.) 
 
 By the Court, Harris, J.^^ * * * 'j^j^g principal, and I think the 
 only question in this case, is whether, after a justice's judgment has 
 become barred by the statute of limitations, it will be so revived by 
 a new promise of payment, as that an action of debt may be maintained 
 upon it. Incidentally a question of pleading is involved, but the 
 decision of the question I have stated must determine the rights of the 
 parties in this action. The plaintiffs maintain the affirmative of this 
 proposition. Unless they can sustain it, their action must fail. The 
 defendant contends, that a promise to pay a judgment, cannot entitle 
 the plaintiff in that judgment to maintain an action upon it, as a subsist- 
 ing cause of action; that a judgment once barred by the statute 
 of limitations can not have its vitality restored by a mere promise to 
 pay. 
 
 The question is not without its difficulty ; and neither party is with- 
 out eminent authority to sustain his position. It seems, however} to 
 be settled against the defendant, in tliis state. Upon a full examina- 
 tion of the cases in which the subject has been discussed I am satis- 
 fied that, at least in this state, the doctrine is too firmly established 
 to be again unsettled, that where the operation of the statute of lim- 
 itations is avoided by a new promise, the old demand, and not the 
 
 SI Part of the report is omitted. 
 
Sec. 6) PAST CONSIDERATION 419 
 
 new promise, is to be the foundation of the action. I confess that were 
 I at liberty to reason upon the question, the inclination of my mind 
 would be to the other side of this question. The doctrine rests for 
 its support upon a distinction between the cause of action itself, and 
 the remedy. The distinction is too thin and subtle to be received 
 with satisfaction. An existing, continuing cause of action, without 
 any remedy to enforce it, is, to my mind, a mere abstraction. To say 
 that a man has a cause of action left, after he has lost, by the operation 
 of the statute, his remedy upon it, seems to me little less absurd, than 
 to say I still have my property after I have actually lost it. If a 
 ■ debtor obtain a discharge under an insolvent act, a subsequent promise 
 to pay the debt discharged, is regarded as a new contract, supported, 
 it is true, by the pre-existing moral obligation, as a consideration for 
 the new promise, but to be enforced as a new contract, and, like every 
 other contract, actording to its own terms. The reasonableness of 
 this doctrine is much more manifest, at least to my mind, than that 
 which has been established in this state in respect to the revival of 
 debts barred by the statute of limitations. The best defense of the 
 latter doctrine, with which I have met, is contained in the opinion of 
 Mr. Justice Marcy, in Dean v. Hewit, 5 Wend. 257. His argument 
 is, that the new promise rebuts the presumption of payment upon 
 which the statute of limitations proceeds, and has the same effect, in 
 keeping alive the remedy, whether made before or after the statute 
 attaches. I am unable to perceive the conclusiveness of this reason- 
 ing. In the one case, the new promise,' made before the statute has 
 barred the debt, arrests its course, and a new starting point is made, 
 from which it again commences to run. It cannot be said, in that case, 
 that the new promise revives the debt ; for it never was extinct. But 
 when the statute has once attached, the debt is in fact, however it 
 may be in theory, extinct. It has lost all its vitality.. If, afterwards, 
 it has any "legal^ use or validity," it is through the reanimating prin- 
 ciple of the new promise. And it is only useful for this purpose, as 
 furnishing, by virtue of its continuing moral obligation, a sufficient 
 consideration for the promise. But it would not be profitable further 
 to examine the foundations of this doctrine. It is enough, for the pres- 
 ent occasion, that the question is entirely settled by adjudged cases 
 in our own courts. I cheerfully yield to their authority, and even 
 where I cannot clearly see the reason upon which they are founded, 
 I can say with Lord Kenyon, "it is my wish arid comfort to stand super 
 antiquas vias." See Sands v. Gelston, 15 Johns. 511; Bell v. Mor- 
 rison, 1 Pet. 351, 7 L. Ed. 174; Depuy v. Swart, 3 Wend. 135, 20 Am. 
 Dec. 673 ; Soulden v. Van Rensselaer, 9 Wend. 293. 
 
 The doctrine is perhaps as clearly stated in Dean v. Hewit as any 
 where else. "A demand," says Justice Marcy, "the remedy for the 
 recovery of which is continued or revived by a new promise, is pre- 
 cisely the same, after the remedy has been continued or revived, as it 
 
420 CONSIDERATION (Ch. 2 
 
 was before the statute had or could have attached." In that case, 
 the action was upon a negotiable note. The new promise relied upon 
 to relieve it from the operation of the statute of limitations, was made 
 to the payee. It was held, that the negotiability of the note was co- 
 existent with the demand, and that the remedy upon the note having 
 been revived, while the note remained in the hands of the payee, an 
 indorsee, to whom it had been subsequently transferred, might main- 
 tain his action upon it.^^ The same was held in Pinkerton v. Bailey, 
 8 Wend. 600; also in Soulden v. Van Rensselaer, above cited. If, 
 then, the new promise so complietely restores life, and gives effect to 
 the original demand, as in the case of a negotiable instrument, to en- 
 able a subsequent holder, to maintain an action upon it, I think it must 
 follow, that in case of a justice's judgment barred by the same statute; , 
 a new promise will enable the plaintiff in the judgment to maintain 
 an action upon it, with the same effect as before the statute had at- 
 tached. It is true, that all the cases in which the question has been 
 presented were actions upon contract. . It is only since the adoption 
 of the revised statutes, that justices' judgments have been subject to 
 the operation of the statute of limitations. Pease v. Howard, 14 
 Johns. 479. But if a new promise can have the effect of sustaining 
 an action upon a negotiable security in the hands of an indorsee, to 
 whom it has been transferred after the promise, much more should 
 it have the effect to enable the plaintiff in a justice's judgment to whom 
 the promise was made, to maintain an action of debt upon it. * * * 
 
 Upon the whole case, therefore, the plaintiffs are, in my opinion, 
 entitled to judgment. 
 
 Judgment for the plaintiffs.^* 
 
 22 In accord: Way v. Sperry, 6 Gush. (Mass.) 238, 52 Am. Dec. 779 (1850) ; 
 Little V. Blunt, 9 Pick. (Mass.) 488 (1830). 
 
 23 Under tlie prevailing statutes of limitation it is very generally held that 
 a specialty debt is not revived by a new parol promise: Crawford v. Chil- 
 dress Ex'r, 1 Ala. 482 (1840) ; Fuller v. Hancock, 1 Root (Conn.) 238 (1791) ; 
 Ludlow V. Van Camp. 7 N. J. Law, 113, li Am. Dec. 529 (1823). So also 
 the remedy on a judgment is not revived by a later parol promise. Niblack 
 V. Goodman, 67 Ind. 174 (1879) ; Favrot v. Bates, McGloin (La.) 130 (1881) 
 Brooks v. Preston, 106 Md. 693, 68 Atl. 294 (1907) ; Olson v. Dahl, 99 Minn. 
 488, 109 N. W. 1001, 8 L. R. A. (N. S.) 444, 116 Am. St. Rep. 435, 9 Ann. Cas. 
 252 (1906) ; Garabedian v. Avedisian (R. I.) 105 Atl. 516 (1919) ; Taylor 
 V. Spivey, 33 N. C. 427 (1850) ; Berkson v. Cox, 73 Miss. 339, 18 South. 934, 
 55 Am. St. Rep. 539 (1895) ; McAleer v. Clay County (C. O.) 38 Fed. 707 
 (1889). Contra : Spilde v. Johnson, 182 Iowa, 484, l09 N. W. 1023, 8 L. R. 
 A. (N. S.) 439, 119 Am. St. Rep. 578 (1906) ; . Olcott v. Scales, 3 Vt. 173, 21 
 Am. Dec. 585 (1831) ; Car.shore v. Huyck, 6 Barb. (N. Y.) 583 (1849). An 
 action may be maintained upon the new promise, however, and the specialty 
 or judgment may be proved as a sufficient consideration for the promise. La- 
 mar V. Manro, 10 Gill & J. (Md.) 50 (1838) ; Brooks v. Preston, 106 Md. 693, 
 68 Atl. 294 (1907) ; Young v. Mackall, 3 Md. Ch. 898 (1850) ; St. Mark's 
 Evangelical Lutheran Church v. Miller, 99 Md. 23, 57 Atl. 644 (1904) ; Otis v. 
 Gazlin, 31 Me. 567 (1850). Contra: Ludlow v. Van Camp, 7 N. J. Law, 113, 
 11 Am. Dee. 529 (1823), the Chief .Justice dissenting. 
 
 An action for a tort, barred by statute of limitations, is not revived by an 
 acknowledgment or a new promise. Hegedus v. Thomas Iron Go. (N. J. Sup.) 
 
Sec. 6) • PAST C6NSIDEBATI0N 421 
 
 TRASK V. WEEKS et al. 
 (Supreme Judicial Court, of Maine, 1889. 81 Me. 325, 17 Atl. 162.) 
 
 Assumpsit on account by Abiel Trask against William Weeks aiid 
 Stinson Weeks. Reported to stand for trial if, in the opinion of the 
 law court, it could be maintained. 
 
 Danforth, J.^* It is conceded that this action cannot be maintained 
 against the defendant William Weeks. The result as to the other de- 
 fendant must depend upon the construction of the following written 
 contract, viz. : "Whereas, Abiel Trask, of Jefferson, has unsettled ac- 
 counts against William Weeks and myself which it is not convenient to 
 settle at this time, now I hereby agree to waive any and all objection 
 to said accounts which might be brought against them on account of 
 the statute of limitations, and hereby renew the promise to pay what- 
 ever balance shall be against us." This contract was dated March 
 20, 1868, signed by the defendant Stinson Weeks, and presumably 
 delivered to the plaintiff at its date; and now, after the lapse of 
 20 years, this action is brought upon an account which is assumed 
 to be that referred to in the agreement. To this action the defendant 
 proposes to plead the statute of limitations. Is it competent for him to 
 do so ? 
 
 The plaintiff answers this question in the negative, claiming that the 
 contract is equivalent to a covenant not to set tip the statute in the fu- 
 ture as a defense to the debt, and is therefore technically an estoppel, 
 or operates as an estoppel, to avoid circuity of action, and relies upon 
 Warren v. Walker, 23 Me. 453. It is clear that the contract cannot 
 operate as an estoppel, for having been entered into after the statute 
 of limitations had taken effect, there is no evidence in the case that 
 the plaintiff', in consequence of it, has been induced to change his 
 position, so as to lose any legal rights by delay or otherwise. There 
 appear also insurmountable obstacles to its operation as a covenant. 
 To give it this or any effect, it must necessarily have a sufficient con- 
 sideration to siipport it. Such a contract, as seen in Warren v. Walk- 
 er, is entirely independent of that mentioned in the statute as an ac- 
 knowledgment of or a new promise to pay the debt, and must there- 
 fore have an independent consideration. In Warren v. Walker this 
 was evidently considered an indispensable requisite, and much stress 
 was laid upon the fact that a sufficient consideration there appeared. 
 
 110 Atl. 822 (1920). But if the tort was sucla that a;n action of indebitatus as- 
 sumpsit could have been maintained against the wrong-doer, the debt Created 
 by the tort, even though barred, is a sufficient consideration for a new promise 
 to pay it. See Ott v. Whitworth, 27 Tenn. (8 HuBjph.) 494 (1847), a new 
 promise is not implied in a inere confession of the tort ; Oothout v. Thomp- 
 son, 20 Johns. (N. Y.) 277 (1822) : Nelson v. Petterson, 229 111. 240, 82 Jj. 
 E. 229, 13 L. R. A. (N. S.) '912, 11 Ann. Ca's. 178 (1907) ; Belcher v. Tacoma 
 Eastern R. Co., 99 Wash. B4, 168 Pac. 782 (1917). 
 2* Part of the opinion is omitted. 
 
422 CONSIDERATION . ' (Ch. 2 
 
 In this case, though there appears abundant consideration for the con- 
 tract construed as a new promise, none appears for such as the plaintiff 
 claims it to be. As such jt is immaterial that there is a subsisting debt, 
 for, while the debt i^ the subject-matter of the contract, its state or con- 
 dition is not changed; its obligation has neither increased nor dimin- 
 ished. Its value might be greater in consequence of a valid contract 
 of that. kind, but a benefit to the plaintiff is no reason for an increased 
 obligation to the defendant, and, the statute of limitations having 
 already applied, the delay takes no legal right from the plaintiff. True, 
 as a supplementary report, there is. in, the case an agreement from 
 the plaintiff to the defendant which we may assume is a part of the 
 same transaction, but it is not of the same tenor as the defendant's. 
 It promises nothing. It simply agrees to waive the statute, and "allow 
 whatever may be found justly due them on settlement." This can only 
 be construed to allow the amount on the plaintiff's account, and, as 
 the defendant had already provided for this by his promise to pay 
 the balance only, the agreement could be of no value to him, or in- 
 jury to the plaintiff. It can therefore hardly be considered a valid 
 consideration for the defendant's contract, as claimed by the plaintiff. 
 
 The proper construction of the agreement shows clearly that it is 
 not in effect what the plaintiff claims, but that it was intended rather 
 as the new promise contemplated by the statute to take the account out 
 of its provisions than an independent covenant not to set it up in de- 
 fense. The plaintiff contends that it is both; that it contains two 
 elements,^a waiver of the statute, and a new promise to pay the 
 balance due. There may be two elements, but they constitute one con- 
 tract only. They are so combined that they cannot be separated, and 
 must be construed as one whole. It is not to be expected, even if it 
 were possible, that the parties would thus put in one, two contracts so 
 entirely different in tfaeir nature and effect, when either would have 
 answered the purpose in view. That the parties at the time the con- 
 tract was made had in view the then condition of the account is 
 evident from its terms. It refers in the preamble to the inconvenience 
 of a settlement "at this time," agrees to waive, not the statute, "but 
 all objections which," not may, but "might, be brought against theni 
 on account of the statute," and then, evidently to accomplish this purr 
 ipose, adds, "and hereby renew the promise to pay whatever balance 
 shall be against us," thus making the last clause a qualification of what 
 went before. The waiving and the prornise must stand or fall togeth- 
 er; the former being in force only as long as the latter, and hence 
 the contract as a whole subject to the statute of limitations. * * * 
 
 Plaintiff nonsuit.^' 
 
 26 An agreement not to plead the statute as a defense has been held valid 
 and not against public policy. State Trust Co. v. Sheldon, 68 Vt. 259, 35 
 Atl. 177 (1895) ; Wells Fargo & Co. v. Enright, 127 Cal. 6G9, 60 Pac. 439, 49 
 L. R: A. 647 (1900). 
 
Sec. 6) PAST CONSIDERATION 423 
 
 BARKER V. HEATH, 
 (Supreme Court o£ New Hampshire, 1907. 74 N. H. 270, 67 Atl. 222.) 
 
 Action by Levi Barker against Kate P. Heath on a note for $734.52, 
 dated April 1, 1895, and payable to plaintiff on demand with interest. 
 Suit was brought November 2, 1905, and defendant pleaded limita- 
 tions, to which plaintiff replied, alleging new promise within six years. 
 A verdict was rendered in favor of plaintiff, and the case was trans- 
 ferred to the Supreme Court. Exceptions sustained. 
 
 The following indorsements are upon the back of the note: April 
 10, 1895, $5; September 19, 1895, $5; October 16, 1895, $5; De- 
 cember 16, 1895, $5 ; September 19, 1896, $3 ; August 25, 1898, $2 ; 
 December 26, 1899, $2. The plaintiff testified as follows : He re- 
 ceived the foregoing sums from the defendant at the dates mentioned, 
 and made the indorsements in her presence. At the time of the last 
 payment the defendant said, in substance, that it was all she could 
 give him at that time ; that she would give him more as soon as she 
 could, and would pay him just as fast as she could; that she was 
 having a hard time, her boarders had left her, her eyes were trou- 
 bling her, and she had to go to an oculist; that it was taking her 
 money, but she would pay him as fast as she could. At the dates of 
 the indorsements she always promised to pay as fast as she could and 
 as soon as she was able, and wanted him to be easy with her. In a con- 
 versation subsequent to December 26, 1899, she said she had no money 
 for him then, but would give him some just as soon as she could. 
 The defendant's evidence tended to prove that she did not make either 
 of the last two payments indorsed on the note; that she did not prom- 
 ise the plaintiff at any time that she would pay the balance of the note, 
 because she knew it was impossible for her to do so ; and that she did 
 not promise him on December 26, 1899, or at any subsequent date, 
 that she would pay the note as soon as she was able, or as soon as she 
 could, or promise anything to that effect. * * * 
 
 The court, after instructing the jury that their verdict must be for 
 the defendant unless she, by her acts or promises, gave the plaintiff 
 to understand within six years that she recognized the existence of 
 the note and intended to pay it, further instructed them that the prom- 
 ise must be absolute, or, if conditional, that the condition must have 
 been fulfilled; and that a promise by the defendant to pay as soon 
 as she could, or when she was able, would be regarded by the law 
 of this state as an absolute promise. Continuing, the court said: 
 "So if you find that within six years she said, 'I will pay it as soon as 
 I can,' or 'as soon as I am able,' then yoji will regard it as having 
 been an absolute and unqualified promise on her part." To this por- 
 tion of the charge the defendant excepted. 
 
 Chase, J.^° It was held in the earlier cases of assumpsit in this state 
 
 ^' Parts of the report are omitted. 
 
424 CONSIDEKATION (Ch. 2 
 
 that, while, a simple acknowledgment of a debt would not prevent the 
 statute of limitations from operating upon it, such acknowledgment 
 was evidence from which, if there was nothing to rebut it, a jury might 
 find a new promise. If the acknowledgment was accompanied by a 
 condition, limitation, or qualification of any kind, its efifect as evidence 
 was modified correspondingly. Stanton v. Stanton, 2 N. H. 425 ; Bus- 
 well V. Roby,3N. H. 467; Atwoodv. Coburn, 4N. H. 315. * * * 
 In case there is a condition, the creditor must show that it has been f ul-. 
 filled or complied with to entitle himself to the implication of a new 
 promise. Russell v. Copp, 5 N. H. 154; Expter Bank v. Sullivan, 6 N. 
 H. 124, 135, 136; Manning v. Wheeler, 13 N. H. 486, 487; Ventris v. 
 Shaw, 14 N. H. 422; Butterfield v. Jacobs, l5 N. H. 140; Downer v. 
 Shaw, 28 N. H. 151, 153; Dodge v. Leavitt, 59 N. H. 245; Stowell v. 
 Fowler, 59 N. H'. 585 ; Holt v. Gage, 60 N. H. 536; Pickering v. Frink, 
 62 N. H. 342; Gage v. Dudley, 64 N. H. 271, 275, 9 Atl. 786; Engel 
 V. Brown, 69 N. H: 183, 184, 45 Atl. 402 ; Mooar v. Miooar, 69 N. H. 
 643, 46 Atl. 1053; Rossiter v. Colby, 71 N. H. 386, 387, 52 Atl. 927. A 
 partial payment of a promissory note by the maker, under circumstanc- 
 es which show that he understood it was partial only, and which do 
 not indicate an unwillingness on his part to pay the balance, is evi- 
 dence from which, if there is nothing to control it, a jury should find 
 a new promise. Indorsements upon a note will not be received as 
 evidence of such payments, unless shown to be in the handwriting of 
 the maker, or there is other evidence of their genuineness and trutl;i- 
 fulness. Exeter Bank v. Sullivan, 6 N. H. 124; Kenniston v. Avery, 
 16 N. H. 117; Chapman v. Boyce,16 N. H. 237; Jones v. Jones, 21 N. 
 H. 219; Brown v. Latham, 58 N. H. 30, 42 Am. Rep. 568; Engel v. 
 Brown, 69 N. H. 183, 45 Atl. 402. 
 
 According to the plaintiff's testimony, the defendant made a pay- 
 ment of $2 upon the promissory note in suit within six years of the 
 time when the action was brought, and said, in substance, at the time 
 of making the payment, that it was all she could then pay, that she 
 would, pay more as soon as she could, would pay just as fast as she 
 could on the note. This testimony, if credited by the jury, would justi- 
 fy them in finding that the defendant understood she was making a par- 
 tial payment upon a promissory note which she regarded as a sub- 
 sisting debt that she was liable to pay, and was willing to pay as fast 
 as she could or was able. Her statement? relating to losing her board- 
 ers, and to the extraordinary expenses to which she was subjected by 
 reason of the trouble in her eyes, tend to prove that her willingness 
 to pay was conditional and depended upon hetr future pecuniary ability. 
 In effect, she promised that she would make payments on the note as 
 fast as her pecuniary ability would enable her to do so. The later 
 statement in evidence was to the same effect. In Butterfield v. '^Ja- 
 cobs, 15 N. H. 140, 141, the court said: "Where a person, on being 
 applied to for payment of a debt, declares his inability to pay It, but 
 promises to pay it when he shall become able> the happening of the 
 
SeC.B) PAST CONSIDERATION 425 
 
 contingency is in its nature susceptible of being proved. His, pecuni- 
 ary ability is a matter of fact no more indefinite nor uncertain than 
 most facts ordinarily in controversy. Such a promise is clearly con- 
 ditional, dependent on the happening of a future event. Evidence 
 of the promise and of the pecuniary ability has therefore been hejd 
 sufficient to take a case out of the operation of the statute." * * * 
 It is quite clear that if the plaintiff's testimony in the present case is be- 
 lieved, the defendant's willingness to pay the balance of the note de- 
 pended upon her pecuniary ability to pay it. Recent cases fully jus- 
 tify this Yiew. Stbwell v. Fowler, 59 N. H. 585 ; Rossiter v. Colby, 
 71 N. H. 386, 52 Atl. 92?. See, also, Atwood v. Coburn, 4 N. H. 
 315, 318; Betton v. Cutts, 11 N. H. 170; Manning v. Wheeler, 13 
 N. H. 486. The defendant's exiception to the charge of tiie court must 
 therefore be sustained. * * * ^'' 
 
 EARLY V. MAHON. 
 (Supreme Court of New York, 1821. 19 Johns. 147,' 10 Am. Dec. 204.) 
 
 This was an action of assumpsit, tried at the Delaware Circuit, in 
 June, 1820, before Mr. Chief Justice Spencer. 
 
 The plaintiff lent the defendant certain sunjs of money, for which 
 the defendant gave a bond and warrant of attorney, in which bond 
 was included usurious interest on the money lerit. A judgment was 
 entered upon the bond, in the Court of Common Pleas of Delaware 
 county; and the Court, after-wards, on motion for that purpose, set 
 aside the judgment on the ground of usury. The defendant, after- 
 wards, promised to pay the plaintiff the original sum actually borrow- 
 ed, but not the usurious interest contained in the bond. On this prom- 
 ise, the present suit was brought. At the trial, the plaintiff produced 
 
 " In accord : Gillingliam v. Brown, 178 Mass. 417, 60 N. E. 122, 55 L. R. A. 
 320 (1901) ; Oliver v. Gray, 1 Har. & G. (Md.) 204,, 216 (1827) ; Tanner v. 
 Smart, (K. B.) 6 B. & C. 603 (1827) ; Big Diamond Milling Co. v. Chicago, 
 M. & St. P. R. Co., 142 Minn. 181, 171 N. W. 799, 8 A. L. R. 1254 (1919) ; Mor- 
 gan Hardware Co. v. American Carriage Co., 22 Ga. App. 168, 95 S. E.-721 
 (1918). 
 
 In Philips v. Philips (Ch.) 3 Hare, 281, 289 (1844), the court said: "The 
 legal effect of an acknowledgment o:f a debt barred by the Statute of Limita- 
 tions is that Of a promise to pay the old debt, and for this purpose the old 
 debt is a consideration in law. In that sense, and for that purpose, the old 
 debt may be said to be revived. It is revived as a consideration for a new 
 promise. But the new promise and not the old debt, is the measure of the 
 creditor's right. If a debtor simply acknowledges an old debt the law im- 
 plies from that simple acknowledgment a promise to pay it; for which 
 promise the old debt is a sufficient consideration. But if the debtor promises 
 to pay the old debt when he is able, or by instalments, or in two years, or 
 oiit of a particular fund, the creditor can claim nothing more than the promise 
 gives him. And the same consequences, I conceive, will follow upon that 
 sort of acknowledgment which is found in a will like the present, creating 
 a trust for paying debts barred by the Statute of Limitations. The creditor 
 will get nothing but what the trust gives him." i 
 
426 CONSIDERATION (Ch. 2 
 
 the bond and note^ which had also been given by the defendant, and 
 offered to deliver them up, to be cancelled. 
 
 The Chief Justice was of opinion that the actual money lent, was a 
 sufficient consideration to support the. promise of repayment, though 
 the securities taken were usurious and void; and the jury, under his 
 direction, found a verdict for the plaintiff, for $569.84, subject to the 
 opinion of the Court, on a case to be made. 
 
 Spencer, C. J. delivered the opinion of the court.^^ There are two 
 questions presented by the case: 1. Whether, when money has been 
 lent upon an usurious contract, and the contract is afterwards vacated, 
 there yet exists such a moral and equitable duty on the part of the 
 borrower, that a subsequent promise by him to pay the money actually 
 lent, can be enforced at law, in an action founded on the promise? 
 
 1. The case of Barnes v. Hedley, 2 Taunt. 182, contains all the au- 
 thorities and decisions in the Biritish courts, on the first point; and, 
 in my opinion, places the validity of the promise, and the sufficiency 
 of the consideration, beyond a doubt. In that case, the original se- 
 curity was confessedly usurious ; it was, by mutual consent, delivered 
 up and cancelled and the borrowers promised to repay the principal 
 and interest ; and it was decided that the plaintiffs were entitled to 
 recover the principal and legal interest. It was an issue out of Chan- 
 cery and the Judges merely certified the result of their decision with- 
 out giving their reasons at large. It has been repeatedly decided in this 
 Court, that an equitable or moral duty is a sufficient consideration for 
 an actual promise to pay. In Hawkes y. Saunders, Cowp. 289, Buller, 
 J. said, "if such a question were stripped of all authority, it would be 
 resolved, by inquiring, whether law were a rule of justice, or whether 
 it was something that acts in direct contradiction to justice, conscience 
 and equity ; but (he added) the matter has been repeatedly decided." 
 I consider it entirely settled, that notwithstanding the security be usu- 
 rious, the money lent is a debt in equity and conscience, and ought to 
 be repaid. This principle has long been acknowledged, and acted up- 
 on in courts of equity. 2 Vesey, 567 ; 2 Brown's Ch. Cas. 649. In 
 the latter case, upon an application to set aside a judgment tainted 
 with usury, it was decided, that it could be displaced only by doing 
 what was just, and that it must stand for the money actually paid, 
 with legal interest. In Rogers v. Rathburn, 1 Johns. Ch. 367, the 
 Chancellor pronounced it to be a settled principle, that he who seeks 
 equity, must do equity; that if the borrower came into that court for 
 relief against his usurious contract, he must do what is right, as be- 
 tween the parties, by bringing into court the money actually advanced, 
 with the legal interest; and that then the court would lend, him its 
 aid, as against the usurious excess. The statute to prevent usury, (1 
 N. Y. L. 1813, p. 64,) after regulating the rate of interest, and for- 
 
 28 Part of the opinion has been omitted. 
 
Sec. e) PAST CONSIDERATION 427 
 
 bidding a higher rate than seven per cent, per annum, to be taken, de- 
 clares, that all bonds, bills, notes, contracts and assurances upon, or 
 iox any usury, by which; there shaU be reserved or taken, or, secured, 
 or agreed to be reserved or taken, above seven per cent, shall be utter- 
 ly void. ' This provision of the statute relates wholly to the contract ; 
 and it makes that entirely void. Hence, it has been frequently held, 
 that where there Was an antecedent valid debt, and a security was giv- 
 en by the debtor, reserving illegal interest so as to be usurious, that 
 the security being void, the 'pre-existing debt might be recovered^ if 
 even the security was one of a higher nature. 3 Camp. N. P. 119; 
 1 Hen. Bl. 462. I do not mean to say, that in this case, the plaintiff 
 can recover, on the ground that the defendant has had his money, 
 and the bond he took for it was void; and, that, therefore, he can 
 maintain an action on the implied assumpsit. Here, the lending, and 
 the usurious agreement, 'were contemporaneous acts ; the usury in- 
 fected the whole transaction; but I do say, in the words of Mr. Jus- 
 tice Lawrence, "the ttsury could not annihilate the sum of money it- 
 self, nor the fact of the receipt of the money ;" and it does not admit 
 of a doubt, that the defendant having had the plaintiff's money, with- 
 out any consideration or security, but a void bond, the promise sub- 
 sequently to repay this money, was founded on a moral and equitable 
 duty. In Fitzroy V. Gwillim, 1 Term Rep. 153, in trover for goods 
 which had been pledged for money advanced on an usurious con- 
 tract, it was held, that to entitle the plaintiff to recover, it was nec- 
 essary to prove a previous tender oi the money actually due. This 
 was a recognition by a court of law, of the principle adopted in courts 
 of equity, that althotigh the contract was void, there was yet a sub- 
 sisting duty on the part of the borrower. It is observable, too, that 
 the plaintiff has not committed an act which is malum in se, but ma- 
 lum prohibitum merely; and this distinguishes this case from giving 
 money to one to commit a crime. In such case, it could not be re- 
 covered back, even upon a promise to restore it ; and, it is to be borne 
 in mind, that the present contract is free from usury. * * * 
 Judgment for the plaintiff." 
 
 2 8 In McClure v. Williams, 7 Vt. 210, 213 (1835), the court said: "The taint 
 of usury is indeed upon him, but if the borrower promises to pay the honest 
 debt, why is not the promise binding V The cash leat is still due and unpaid, 
 and therefore as much a moral right and duty as a sum justly due on a note 
 against which the statute of limitations has run, or that has been discharged 
 by a certificate of bankruptcy ; and no reason is perceived why the promise 
 need be in writing in this any more than in those cases. In those cases, the 
 original contract or note having been valid, it is declared upon, and the new 
 promise removes the bar. Here the new promise is declared upon, because, the 
 first security was void, and the second good, which some judges have intimat- 
 ed should be the mode in case of a new promise, which avoids the statute of 
 limitations.'' 
 
 Other cases in accord are Kilbourn v. Bradley, 3 Day (Conn.) 356, 3 Am. 
 Dec. 273 (1809) ; Pinckard v. Ponder, 6 Ga. 253 (1849) ; Phillips v. Columbus 
 City Bldg. Ass'n, 53 Iowa, 719, 6 N. W. 121 (1880) ; Sanford v. Kunz, 9 
 Idaho, 29, 71 Pac. 612 (1903) ; Sheldon v. Haxtun, 91 N. X. 124 (1883) ; 
 
428 CONSIDERATION (Ch. 2 
 
 BREWSTER, V. BANTA. 
 (Supreme Court of New Jersey, 1901. 66 N. J. Law, 367, 49 Atl. 718.) 
 
 DepuE, C. J. The declaration contains only the common counts. 
 Annexed to it is a notice, pursuant to the statute, that the action was 
 brought to recover the amount due on a promissory note dated Novem- 
 ber 7, 1898, made by Demarest Banta, and indorsed by Harvey D. Ban- 
 ta. The defense was that the note in question was made on Sunday, 
 and that it was given in payment of the difference on an exchange of 
 horses concluded on that day, and was therefore void. The case was 
 tried in the Bergen circuit by the court without a jury. The court 
 directed a nonsuit as to Harvey Banta, and found in favor of the 
 plaintiff as against Demarest Banta. The judge held that the Sunday 
 transaction was wholly illegal, and a nonsuit as to Harvey Banta was 
 directed on the ground that he had no connection with the transaction, 
 except in the indorsement of the note. The finding against Demarest 
 Banta was made on the ground of an express promise made by him to 
 the plaintiff to pay the debt after the note was given, which the learned 
 jildge decided was binding upon him. The law regulating this subject 
 is conclusively settled in the series of cases beginning with Reeves v. 
 Butcher, 31 N. J. Law, 224. In the first of these cases the supreme 
 court held that the statute forbidding worldly employment or business 
 on Sunday rendered void every transaction which, if performed on a 
 week day, would be enforceable in a court of justice; that such a 
 transaction, beitig wholly void, could not be validated by ratification, but 
 that the consideration emanating from the tainted contract will be suf- 
 ficient to form the foundation for a new express promise, on which 
 recovery might be had. Reeves v. Butcher, supra ; Ryno v. Darby, 20 
 N. J. Eq. 231 ; Cannon v. Ryan, 49 N. J. Law, 314, 8 Atl. 293. ~ 
 
 The trial court found, as a question of fact, that, so far as Demarest 
 Banta was concerned, there had beeij an express promise to the plain- 
 tiff to pay the debt. In the trial of an issue before the court, a jury 
 being waived, pursuant to section 176 of the practice act (2 Gen. St. p. 
 2562), the court is substituted for the jury, and its finding on questions 
 of fact cannot be reviewed on writ of error. All that can be reviewed 
 is the sufficiency of the facts found to support the judgment. Bridge 
 Co. V. Geisse, 38 N. ]. Law, 39, 580; City of Elizabeth v. Hill, 39 
 N. J. Law, 555 ; Blackford v. Gaslight Co., 43 N. J. Law, 440. In this 
 case there was evidence of a subsequent express promise to pay the 
 note, and the trial judge so found. That decision cannot be called in 
 question. 
 
 The judgment should be affirmed. 
 
 Drake's Ex'r v. Chandler, 18 Grat. (Va.) 909, 98 Am. Dec. 762 (1868) ; 
 Barnes v. Hedley, (,C. P.) 2 Taunton, l84 (1809) ; Flight v. Heed, (Bxch.) 1 
 H. & 0. 7^3 (1863). , • 
 
Sec. 6) PAST CONSIDERATION 429 
 
 MUIR V. KANE et ux. 
 
 (Supreme Court of Washington, 1909. 55 Wash. 131, 104 Pac. 153, 26 L. E. A. 
 [N. S.] 519, 19 Ann. Cas. 1180.) 
 
 Action by B. L. Muir against M. Francis .Kane and wife. Judg- 
 ment for plaintiff, and. defendants appeal. Affirmed. 
 
 The plaintiff is a real estate btoker and had found a purchaser for 
 a jparcel of land in Seattle by virtue of an oral agreement with the 
 owners thereof, the defendants Kane and wife. The defendants later 
 executed a written agreement with the purchaser, one Paul Bush, stat- 
 ing the terms of the sale and expressly providing that the defendants 
 should pay to the plaintiff the sum of $200 out of the purchase price 
 for his services theretofore rendered as broker. They have not paid 
 this sum, and he now sues to enforce 'the written agreement. 
 
 FuLLERTON, J.'" * * * The statute (Laws 1905, p. 110, c. 58) 
 governing contracts for commissions for buying or selling real es- 
 tate provides that any agreement authorizing an employe, as an agent, 
 or broker, to sell or purchase real estate for compensation or a com- 
 mission, shall be void unless the agreement, contract, or promise or 
 some note or memorandum thereof be iii writing. The appellants cdn- 
 tend that the writing relied upon by the respondent is insufficient under 
 the statute; that it is not an agreement authorizing the respondent 
 to sell the real property described for compensation or commission, 
 nor does it authorize Or employ the respondent to sell real estate at all. 
 Manifestly, if the writing sued upon was intended as an agreement au- 
 thbrizing the respondent to sell real estate of the appellants, it is faulty 
 in the particulars mentioned, and so far deficient as not to warrant a 
 recovery even if a sale had been made thereunder. But we do not un- 
 derstand that this is the question presented by the record. It is clear 
 that this writing was not intended as an agreement authorizing the re- 
 spondent to sell the real property mentioned. In fact it was executed 
 after that service had been performed, and is an agreement in writing 
 to pay a fixed sum for a past service, not a service to be performed in 
 the future. The question for determination is its validity as a prom- 
 ise to pay for a pa:st service. Looking to the instrument itself; there 
 is nothing on its face that in any manner impugns its validity. It is a 
 direct promise to pay a fixed sum of money for services rendered. Pri- 
 ma facie, therefore, it is legal and valid ; and, if it is illegal at all, it is 
 because the actual consideration for the promise, which was: alleged 
 and proven, rendered the promise, illegal. This consideration was the 
 sale of real property for the appellants by the respondent acting as a 
 broker without a written agreement authorizing the service, and it is 
 thought that, because the statute declares an agreement for such a serv- 
 ice void unless in writing, the service furnishes no consideration for the 
 
 '" The court's statement of the facts is condensed as above and part of the 
 opinion is omitted. 
 
430 CONSIDERATION (Ch. 2 
 
 subsequent promise, since the service must either have beeii founded 
 upon an invalid agreement or was voluntary. There are cases which 
 maintain this doctrine. In Bagnole v. Madden, 76 N. J. Law, 255, 
 69 Atl. 967, the precise: qliestibn was * presented. There the plaintiff 
 had been orally authorized by the defendant to sell a parcel of real 
 estate owned by the defendant. A purchaser was found and a contract 
 of sale entered into. The defendant thereupon executed a written 
 agreement, and delivered the same to the plaintiff, wherein she prom- 
 ised to pay hini $50 for his services. In an action brought upon the 
 writing, the court held that she could not recover because of the in- 
 validity of the original oral contract authorizing the services ; it being 
 in violation of the statute declaring such agreenient void unless in 
 writing. 
 
 The case was rested on a decision of the Court of Errors and Ap- 
 peals (Stout V. Humphrey, 69 N.J. Law, 436, 55 Atl. 281), which an- 
 nounced the same doctrine, but upon a state of fapts not quite the same; 
 the subsequent promise to pay being oral instead of in-writing. In the 
 course of its opinion in the latter case the court said: "It is clear that 
 if a contract between two parties be void, and not merely; voidable, no 
 subsequent express promise will operate to charge the party promising, 
 even though he has derived the benefit of the' contract. Yet, according 
 to the commonly received notion respecting- moral obligations, and 
 the force attributed to a subsequent express promise, such a person 
 ought to pay. An express promise, therefore, as it should seem, can 
 only revive a precedent good consideration which might have been 
 enforced at law through the medium of an implied promise had it not 
 been suspended by some positive rule; of law, but can give no original 
 right of action if the obligation on which it is founded never could have 
 been enforced at law, though not barred by. any legal maxim or stat- 
 ute provision," The court, it will be observed, makes a distinction be- 
 tween contracts formerly good, but on which the right of recovery has 
 been barred by the statute, and those contracts which are barred in 
 the first instance because of some legal defect in their execution, holding 
 that the former will furnish a consideration for a subsequent prom- 
 ise to perform, while the latter will not. It has seemed to us that this 
 distinction is not sound. The moral obligation to pay for services ren- 
 dered as a broker in selling real estate under an oral contract where the 
 statute requires such contract to be in writing is just as binding as is 
 the moral obligation to pay a debt that has become barred by the 
 statute of limitations ; and there is no reason for holding that the lat- 
 ter will support a new promise to pay while the former will not. 
 There is no moral delinquency that attaches to an oral contract to 
 sell real property as a broker. This service cannot be recovered for be- 
 cause the statute says the promise must be in writing, not because it is 
 illegal in itself. It was not intended by the statute to impute moral 
 turpitude to such contracts. The statute was intended to prevent frauds 
 
Sec. ,6) PAST CONSIDERATION 431 
 
 and perjuries, and, to accomplish that purpose, it is required that the 
 evidence of the contract be in writing ; but it is not conducive to either 
 fraud or perjury to say that the services rendered under the void con- 
 tract or voluntarily will support a subsequent written promise to pay 
 for such service. Nor is it a valid objection to say there was no ante- 
 cedent legal consideration. The validity of a promise to pay a debt 
 barred by the statute of limitations is not founded on its antecedent 
 legal obligation. There is no legal obligation to pay such a debt, if 
 there were there would be no need for the new promise. The obligation 
 IS moral solely, and, since there can be no difference in character be- 
 tween one moral obligation and another, there can be no reason for 
 holding that one moral obligation will support a promise while an- 
 other will not. 
 
 Our attention has been called to no case, other than the New Jer- 
 sey case above cited, where the facts of the case at bar are presented. 
 A case in point on the principle involved, however, is Ferguson v. 
 Harris, 39 S. C. 323, 17 S. E. 782, 39 Am. St. Rep. 731. Certain 
 persons without authority from the defendant- had ordered lumber 
 and used it in the erection of a building on the defendant's separate 
 property; she being a married woman. Subsequently she gave her 
 promissory note therefor, and, when an action was brought upon the 
 note, she sought to defend on the ground of want of consideration. 
 It was conceded that there was never any legal obligation on the part 
 of the defendant to pay for the lumber, but that her obligation was 
 wholly moral. It was thereupon urged that such an obligation was in- 
 sufficient to support the promise. Speaking upon, this question, the 
 court said : "All of the authorities admit that where an action to re- 
 cover a debt is barred by the statute of limitations, or by a discharge in 
 bankruptcy, a subsequent promise to pay the same can be supported by 
 the moral obligation to pay the same, although the legal obligation is 
 gone forever; and I am unable to perceive any just distinction between 
 such a case and one in which there never was a legal, but only a moral, 
 obhgation to pay. In the one case the legal obligation is gone as effectu- 
 ally as if it had never existed, and I am at a loss to perceive any sound 
 distinction in principle between the two cases. In both cases, at the time 
 the promise sought to be enforced is made there is nothing whatever to 
 support it except the moral obligation, and why the fact that, because in 
 the one case there was once a legal obligation, which having utterly dis- 
 appeared, is as if it had never existed, should affect the question, I am at 
 a loss to conceive., If in the one case the moral obligation, which alone 
 remains is sufficient to afford a valid consideration for the promise, I 
 cannot see why the same obligation should not have the same effect in 
 the other. The remark made by Lord Denman in Eastwood v. Kenyon, 
 11 Ad. & E. 438, that the doctrine for which I am contending 'would 
 annihilate the necessity for any consideration at all, inasmuch as the 
 mere fact of giving a promise creates a moral obligation to perform 
 it,' is more specious than sound, for it entirely ignores the distinction 
 
432 ; OONSIDPRATION (Ch. 2 
 
 between a promise to pay money which the promisor is under a moral 
 obhgation to pay, and a promise to pay money which the promisor is 
 under no obligation, either legal or moral, to pay. It seems to me that 
 the cases relied upon to establish the modern doctrine, so far as my 
 examination of them has gone, ignore the . distinction pointed out in 
 the note to Cbmstock v. Smith, 7 Johns. (N. Y.) 89, above cited, be- 
 tween an express and an implied promise resting merely on a moral 
 obligation, for^ while such obligiation does not seem to be sufficient to 
 support an implied promise, yet it is sufficient to support an express 
 promise." To the same effect is Anderson v. Best, 176 Pa. 498, 35 
 Atl. 194, wherein it was said : ' "The distinction sought ,tO' be made 
 between considerations formerly good but now barred by statute, and 
 those barred by statute in the first instance, is not substantial, and is 
 not sustained by the cases." See, alsd, Bailey et al. v. Philadelphia et 
 al., 167 Pa. 569, 31 Atl. 925, 46 Am. St. Rep. 691 ; Stout v. Ennis, 28 
 Kan. 706. 
 
 . Believing, as we do, that the better rule is with the cases holding the 
 moral obligation alone sufficient to sustain the promise, it follows that 
 the judgment appealed from should be affirmed. It is so ordered.^^ 
 
 HURLBURT v. BRADLEY et al. 
 (Supreme Court of Errors of Connecticut, 1920.' 94 Conn. 495, 100 Atl. 171.) 
 
 Action by Minnie W. ?Iurlburt against E. Miles Bradley and 
 Dwight E. Russell, the maker and indorser respectively of a promis- 
 sory note. Verdict set aside as against the indorser, and plaintiff ap- 
 peals. Error. . 
 
 On March 20, 1897, the defendant Bradley, by his promissory note, 
 promised to pay to the order of the defendant Russell '■ $500 six 
 months after date at the maker's office, and the defendant Russell in- 
 dorsed the note to the plaintiff. The complaint alleges that at the time 
 of the indorsement it was understood and agreed that the indorser 
 waived presentment and notice of dishonor, and also alleges that the 
 note was not presented for payment at the time and place therein pro- 
 vided, and was not paid at maturity, and the plaintiff did not give the 
 defendant Russell notice of nonpayment, and that Russell afterwards, 
 with full knowledge of these facts, promised and agreed to pay the 
 note. On the trial it appeared that semiannual payments of interest had 
 been made by the maker and indorser on the note down to March 20, 
 1918; that about that time, the plaintiff having demanded payment of 
 the note, the two defendants called at the plaintiff's residence, and aft- 
 er some conversation the defendant Russell promised to pay the note. 
 
 " In accord: Molir v. Rickgauer, 82 Neb. 398, 117 N. W. 950, 26 L. R. A. 
 (N. S.) 533 (1908) ; Pool v. Horner, 64 Md. 131, 20 Atl. 1036 (1885), past 
 consideration given at request. As to moral obligation as a consideration, see 
 notes in 53 L. R. A. 353 ,x 26 L. R. A. (N. S.) 520. 
 
Sec. 6) PAST CONSIDERATION 433 
 
 There was a vecdict for the plaintiff against both defendants, andthe 
 trial court on motion set aside the verdict as to the defendant Russell 
 on the ground that there was no evidence which: would justify the 
 jury in finding that the new promise was made with knowledge on the 
 part of the defendant Russell that no demand had been made on the 
 maker of the note at maturfty. 
 
 Beach, ].^^ (after stating the facts as above). No evidence was 
 offered in support of the allegation of an express waiver of the pre- 
 sentment and notice at the time of the indorsement ; and the first ques- 
 tion is whether a new promise to pay, made by the indorser long after 
 his discharge by omission to make presentment and give due notice of 
 dishonor, revives his liability as indorser when the promise is made 
 with full knowledge of the laches of the holder. ., , 
 
 Until the Negotiable Instruments Act of 1897 the rule, in Connecti- 
 cut was that stated in the headnote to Huntington v. Harvey, 4 Conn. 
 124: "The promise of the indorser of a note, payable to a third per- 
 son, and by him assigned to the holder, to pay the note, made a!f ter the 
 indorser had become discharged from his liability by the laches of the 
 holder, has no legal efficacy, being without consideration." 
 
 On principle this would seem to follow from the language of the 
 indorser's contract. The indorser is not a surety. When his contract 
 is expressed by a simple indorsement, he is only secondarily liable.. 
 In addition to the implied warranties his contract, as defined in sec- 
 tion 4424, is that on due presentment the note shall be paid according 
 to its tenor, and that, if dishonored, and the necessary steps on dis- 
 honor are duly taken, he will pay the amount thereof to the holder or 
 to any subsequent indorser who hag been compelled to pay it. This is 
 the contract which was implied by law before the statute, and, stated 
 shortly, it is : "A contract for payment conditioned on due present- 
 ment to the maker for payment and due notice of dishonor." Spen- 
 cer V. Allerton, 60 Conn. 410-417, 22 Atl. 778, 779 (13 L. R. A. 806). 
 
 If the holder fails to perform these conditions, the result is, as 
 stated in section 4447, that "any * * * indorser to whom such 
 notice is not given is discharged." It is true that the word "discharg- 
 ed" as applied to debts and debtors is used in two senses — it may 
 mean a discharge by performance which puts an end to the obligation 
 as well as to the hability; or it may mean, as in bankruptcy, a per- 
 sonal privilege which lea;ves the obligation unfulfilled, and hence ca- 
 pable of supporting a new promise. As applied to the contract of in- 
 dorsement, a discharge by failure to give notice of dishonor would 
 seem to leave no obligation on the part of the indorser unfulfilled, and 
 hence to leave no support for a new promise to pay. 
 
 It is easy to see why such a promise made after the time for giving 
 notice of dishonor has passed should, be taken as an admission that 
 due notice of dishonor was in fact given, when that fact is in dispute. 
 
 I 32 Part of the opinipn is pmitted. 
 
 CORBIN CONT 28 
 
434 CONSIDERATION (Gh. 2 
 
 And when the question is whether the notice was given within a rea- 
 sonable time, or in a proper manner, such a promise may well be tak- 
 en as an admission that the notice was reasonable and regular. Breed 
 V. Hillhouse, 7 Conn. 523-528. In this case no such question of fact> 
 is in dispute. , The complaint alleges that the note was not presented 
 for payment, and that no notice of dishonor was given. It admits 
 that ihe indorser was discharged; and it is hard to see how a liability 
 can be created more than ten years afterward by a new promise with- 
 out fresh consideration. 
 
 Nevertheless, it has, long- been the law in England and in most of the 
 United States that an indorser who has been discharged may make 
 himself liable by a new promise. No satisfactory explanation of this 
 rule has 'been brought to our attention. * * * 
 
 But, however that may be, our decision is controlled by section 
 4467, which provides that notices of dishonor may be waived either 
 before giving notice or after the omission to give due notice, and that 
 the waiver rriay be express or implied. In the language of the Ken- 
 tucky court, when confronted with the same situation, we feel that the 
 foregoing provision was intended "to put in force in this state the 
 rule that had thei'etofore been adopted by a majority of the states." 
 Mfechanics' Bank v. Katterjohn, 137 Ky. 427, 125 S. W. 1071, Ann. 
 Cas. 1912A, 439. 
 
 The statute puts the revival of liability on the ground of waiver, 
 and in this case waiver by a new promise to pay. To have that effect 
 the promise must have been made with full knowledge of the facts, 
 and the next question is whether the evidence supports the verdict in 
 that respect. The general rule is that the burden of proving a waiver 
 rests upon him who asserts it ; and in this case the complaint express- 
 ly admits that the indorser was discharged, and expressly alleges a 
 subsequent waiver by a new promise made with full knowledge of the 
 facts. The evidence offered in support of these allegations stops with 
 proof of the new promise and with proof that the note was not pre- 
 sented for payment and that no notice of dishonor was given. It may 
 fairly be said, notwithstanding the lapse of time, that the defendant 
 indorser, when he made the new promise, knew that no notice of dis- 
 honor had been given, for he was the one to be notified. But there is 
 no evidence as to whether he knew that the note was not presented for 
 payment, unless such knowledge or the lack of it is to be inferred 
 from the surrounding circumstances. We think, however, that in this 
 particular case it is quite immaterial whether or not the indorser knew 
 of the failure to present the note. The question is whether the new 
 promise was made with intent to relinquish a known right, or in this 
 case a known immunity arising from the lache§ of the holder. A new 
 promise made with knowledge of the fact that no notice of dishonor 
 had been given sufficiently manifests that intent. When the intent to 
 relinquish the immunity is established, the waiver is complete. It 
 adds nothing to prove that the indorser also knew that the note had 
 
Sec. 6) PAST CONSIDERATION 435 
 
 not been presented for payrrient, and it detracts nothing to proVe that 
 he thought it had been presented. It is sufficient that, knowing he 
 was immune from Hability because of the holder's laches, he neverthe- 
 less promised to pay. , ; , 
 
 'There is error, and the case is remanded, with directions to enter 
 judgment against the indorser, Russell, upon the verdict. 
 The other Judges concurred. ^^ 
 
 ' ' ZAVELO V. REEVES et al. 
 
 (Supreme Ck)urt of the United States, 1913. 227 U. S. 625, 33 Sup. 
 Gt. 365, 57 L. Ed. 676, Ann. Cas. 1914D, 664.) 
 
 Mr. Justice Pitney delivered the opinion of the court : ^* 
 Defendants in error sued plaintiff in error November 22, 1907, in 
 the city court of Birmingham, Alabama, declaring upon the common 
 counts for moneys due December 10, 1906, and February 19, 1906, 
 and by an amendment declared upon a promissory note for about $250, 
 which was a part of a claim of the defendants in error that ante- 
 dated the b.^nkruptcy of the plaijititt, in error. The defendant (now 
 plaintiff in error) pleaded that on' l^ovember 22, 1905, he filed in the 
 district court of the United States for the northern district of Ala- 
 bama, his petition in bankruptcy; that said court had jurisdiction of 
 said bankruptcy proceedings, and: duly adjudicated him a bankrupt on 
 that date; that subsequently he offered a composition to his creditors, 
 and the offer was accepted and a composition made in said proceed- 
 ings and duly confirmed by said district court February 6, 1906, a 
 ■certified copy of the decree of confirmation being attached -to and 
 made a part of the plea; that the plaintiffs were then creditors of 
 the bankrupt, and as such accepted the offer of composition and were 
 paid a dividend thereon ; that the claim sued on herein is a part of and 
 was included in said claim on which said dividend was paid, and 
 the claim herein is barred by said proceedings and discharged by 
 said composition. The plajntiffs replied, (a) that on Januai-y 1, 1906 
 (which date was after the adjudication and before the discharge), de- 
 fendant promised that if plaintiffs would lend him $500 for use in pay- 
 ing the consideration of a composition with his creditors in said bank- 
 ruptcy proceedings, he, defendant,' when said composition was con- 
 firmed, would pay plaintiffs the balance of the demand sued on, after 
 
 33 In accord : Doherty v. First Nat. Bank of Louisville, 170 Ky. 810, 186 
 S. W. 937 (1916) ; Sigerson v. Mathews, 20 How. 496. 15 L. Ed. 989 (1857) ; 
 Ross V. Hurd. 71 N. T. 14, 27 Am. Kep. 1 (1877) ; Eindge v. Kimball, 124 
 Mass. 209 (1878) ; Hobbs v. Straine, 149 Mass. 212, 21 N. B. 365 (1889) ; Neg- 
 Inst. Law. §§ 109-111 (Mass. St. 1898. c. 533) ; N. Y. Neg. Inst. Law (Oonsol. 
 Laws, c. 3S) §§ 180-182. See Sebree Deposit Bank v. Moreland, 96 Ky. 150 28 
 S. W. 153, 29 L. R. A. 305 (1894) ; Burgettstown Nat. Bank v. Nill, 213 Pa. 
 456, 63 Atl. 186, 3 L. R. A. (N. S.) 1079, 110 Am. St. Rep. 554, 5 Ann. Cas, 
 476 (1906). Also, for waiver before maturity, L. R. A. 1916B, 944. 
 
 3* Part of the opinion is omitted. 
 
436 CONSIDERATION (Ch. 2 
 
 deducting therefrom plaintiffs' share of the consideration of such 
 composition ; and plaintiffs averred that they accepted defendant's 
 said offer and promise, and did so lend him the said sum of $5QG 
 for the said purpose; and (b) for further replica-tipn, that after the 
 filing of defendants' said petition in bankruptcy, and after he had 
 been adjudged a bankrupt, defendant promised plaintiffs that he would 
 pay what he owed them, being the same demand sued on herein, when 
 his composition in bankruptcy was confirmed, and that plaintiffs 
 accepted said promise. To these replications the defendant demurred. 
 The city court overruled the demurrers and proceeded to a trial of 
 the issues of fact, which resulted in favor of the plaintiffs upon both 
 the common counts and the note. The defendant appealed to the 
 supreme court of Alabama, which affirmed the judgment, 171 Ala. 
 401, 54 South. 654. Whereupon he sued out the present writ of error. 
 
 The case is brought here under § 709, Rev. Stat. (U. S. Comp. Stat. 
 1901, p. 575), the contention being that a right or immunity set up 
 and claimed by the plaintiff in error under the Federal bankruptcy 
 act was denied by the state court. * * * ss 
 
 (2) It is contended as to both replications that although a debt 
 barred by discharge in bankruptcy may be revived by a new promise 
 made after the discharge, this cannot be done by a new promise made 
 in the interim between the adjudication and the discharge. 
 
 It is settled, however, that a discharge, while releasing the bank- 
 rupt from Jegal liability to pay a debt tljat was provable in the bank- 
 ruptcy, leaves him under a moral obligation that is sufficient to support 
 a new promise to pay the debt. And in reason, as well as by the 
 greater weight of authority, the date of the new promise is immaterial. 
 The theory is that the discharge destroys the remedy, but not the 
 indebtedness; that, generally speaking, it relates to the inception of 
 the proceedings, and the transfer of the bankrupt's estate for the 
 benefit of creditors takes effect as of the same time ; that the bankrupt 
 becomes a free man from the time to which the dischar^ relates, and 
 is as competent to bind himself by a promise to pay an antecedent 
 obligation, which otherwise would not be actionable because of the dis- 
 charge, as he is to enter into any new engagernent. And so, under 
 other bankrupt acts, it has been commonly held that a promise to pay 
 a provable debt, notwithstanding .the discharge,, is as effectual when 
 made after the filing of the petition and before the discharge as if 
 made after the discharge. Kirkpatrick v. Tattersall, 13 Mees; & W, 
 766; Otis V. Gazlin, 31 Me. 569; Hornthal v. McRae, 67 N. C. 21 
 Fraley v. Kelly, 67 N. C. 78; Hill v. Trainer, 49 Wis. 537, 5 N. W. 
 926; Knapp v. Hoyt, 57 Iowa, 591, 10 N. W 925,' 42 Am. Rep 
 59; Lanagin v. Nowland, 44 Ark. 84; Wiggin v. Hodgdon, 63 N 
 H. 39 ; Griel v. Solomon, 82 Ala. 85, 2 South. 322, 60 Am. Rep. 733 ; 
 Jersey City Ins. Co. v. Archer, 122 Ivf. Y. 376, 25 N. E. 338. 
 
 so The court held that the pleadings did not show that the agreement was 
 an illegal secret preference. 
 
Sec. 6) PAST CONSIDERATION 437 
 
 Our attention is not called to any decision in point arising under 
 the present bankruptcy act ; but we deem it clear that the same rule 
 should be applied. * * * '" 
 
 Judgment affii-med. 
 
 EARLE V. OLIVER. 
 
 (In the Court of Exchequer, 1848. 2 Exch. 71 [Welsby, H. & G.].) 
 
 Assumpsit. The declaration stated that the plaintifjf had become 
 surety for the defendant in a sum not to exceed i2S0, by a continuing 
 guaranty in favor of a. certain bank giving credit to the defendant. 
 Later, and after the bank had made advances to the defendant, bank- 
 ruptcy ' proceedings were brought against him. During such pro- 
 ceedings the defendant promised the plaintiff in writing that if the 
 plaintiff should be forced to pay to the bank the sum of ;£2S0 by virtue 
 of the guaranty, he would repay that sum to the plaintiff with interest 
 thereon without regard to the certificate of discharge in bankruptcy, 
 "whenever it should be in his power to do so." The plaintiff was 
 later forced to pay i250 to the bank and has been repaid only iSO by 
 the defendant. It was alleged that it had been and still was within 
 the power of the defendant to pay as promised, and judgment was 
 asked for i200 with interest amounting to i52. 
 
 There were several pleas, a replication; and a general demurrer, and 
 the question was whether or not the declaration stated a cause of 
 action. ^^ 
 
 ParkE, B. This case was very fully and ably argued before my 
 Brothers AldERSON, RolFE, PlaTT, and myself, at the sittings after 
 last Michaelmas term. Two questions arose, — the first, as to the suffi- 
 ciency of the first count on general demurrer ; the second, whether 
 the pleadings to the second count, which was money paid, disclosed a 
 sufficient defence. The first count was, in substance, on a promise in 
 writing by the defendant to the plaintiff, .in consideration of the de- 
 fendant's liability, to repay the plaintiff a debt which he had contracted 
 with a banking company as surety for the defendant before the bank- 
 ruptcy; and the promise was made, before the certificate, to repay 
 the debt when the plaintiff should have paid it, and also the interest 
 on that debt from the time it should be paid by the plaintiff' to the time 
 of repaying by the defendant. There was a plea stating that the prom- 
 ise was before certificate, and a special demurrer to the plea, on the 
 ground that it merely stated what was admitted before in the declara- 
 
 '' The court further held that under the present Bankruptcy Act no claims 
 are provable, except those existing at the time of filing the petition, iu 
 bankruptcy, and that therefore the duty created by the new promise was not 
 itself affected by the subsequent discharge. 
 
 '^ The statement of facts has been, condensed and part of the opinion has 
 been omitted. 
 
438 CONSIDERATION (Ch. 2 
 
 tion. That is true, and the consequence is, that the question is simply 
 whethfer the first count is good on demurrer. 
 
 So far as relates to the objection that the promise was made before 
 the certificate, the case of Kirkpatrick v. Tattersall, 13 Mees. & 
 W. 766, is an answer. It may be worth while to state that a similar 
 point had been previously decided by Lord Chief Justice Eyre in the 
 case of Roberts v. Morgan, 2 Esp. 736. 
 
 The next objection was that, although an existing debt which would 
 be barred by a certificate, and which was due by the bankrupt to the 
 plaintiff, was a good consideration to support a promise to pay it, a 
 mere Uability to repay the plaintiff when he should have first paid 
 the debt for the defendant was not. ' This goes a step further than 
 the cases above cited, but seems to us to fall within the same principle. 
 This liability, like the debt, would be discharged by the certificate ; and 
 it seems to us as just and reasonable for the bankrupt, after the fiat, 
 to waive the benefit of his certificate with respect to it, as it is to waive 
 it with respect to a debt ; and, if the debt so discharged is a good con- 
 sideration for a promise to pay it, the liability which is discharged 
 in the same way is a good consideration for a promise to continue 
 liable. 
 
 Two further objections were made, on the supposition that this 
 liability is to be put on the same, footing as a debt, and is a good con- 
 sideration: First, thiat this debt or liability, in a course of being 
 barred by a certificate, cannot be treated as the executed consideration 
 for a promise which a debt or liability, not barred by a certificate, 
 would not support, and that by the course of modern decisions, begin- 
 ning with the case of Hopkins v. Eogan, 5 Mees. & W. 241, and end- 
 ing with Roscorla v. Thomas, 3 Q. B. 234, a debt cannot be laid as 
 an executed consideration for any promise which the law would not 
 imply from it ; and that a promise to pay whenever the party was 
 able was never implied. The second was that. a promise to pay interest 
 could not be supported by the consideration, and was as objectionable 
 as if the promise had been to do any collateral thing. We think that 
 these objections ought not to prevail. 
 
 The : strict rule of the common law was no doubt departed from 
 by Loi'd Mansfield in Hawkes v. Saunders, Cowp. 290, and Atkins 
 V. Hill, Id. 288. The principle of the rule laid down by I^ord Mans- 
 field is that where the' consideration was originally beneficial to the 
 party promising, yet if he be protected from liability by some provision 
 of the statute or common law, meant for his advantage, he may re- 
 nounce 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 perform it. There is a very able note to the case of Wen- 
 nail V. Adney, 3 Bos. & P. 252, explaining this at length. The in- 
 stances given to illustrate the principle are, amongst others, the case of 
 a debt barred by certificate and by the statute of limitations; and 
 the rule in these instances has been so constantly followed that there 
 
Sec. 6) PAST CONSIDEBATION 439 
 
 can be no doubt that it is to be considered as the established law. 
 Debts so barred are unquestionably a sufficient consideration for 
 every promise, absolute or unqualified, qualified or conditional, to pay 
 them. Promises to pay a debt simply, or by installments, or when 
 the party is able, are all equally supported by the past consideration; 
 and, when the debts have become payable instanter, may be given in 
 evidence in the ordinary declaration in indebitatus assumpsit. So, 
 when the debt is not already barred by the statute, a promise to pay 
 the creditor will revive it, and make it a new debt, and a promise to 
 an executor to pay a debt due to a testator creates a new debt to him. 
 But ij does not follow that, though a promise revives the debt in such 
 cases, any of those debts will be sufficient consideration to support a 
 promise to do a collateral thing, as to supply goods, or perform work 
 and labour; and so indeed it was held in this court in the case of 
 Reeves v. Hearne, 1 Mees. & W. 323.^^ In such case it is but an 
 accord unexecuted, and no action will lie for not executing it. 
 
 We think, therefore, that the conditional promise to pay the, debt 
 would be good in this case, and supported by the original considera- 
 tion; and a conditional promise, which, when absolute, will be only 
 a renewal of the original liability, and to the same extent, is equally 
 good and supported by the original consideration, 
 
 The next objection relates to tlie interest. It seems to us to be sup- 
 ported by the same consideration as the original promise. The prom- 
 ise is to pay the debt conditionally; and, if the debt be unpaid, that 
 the defendant will pay interest for it. We are of opinion, therefore, 
 that the first count is good.^^ * * * 
 
 HERRINGTON v. DAVITT et al. 
 (Court of Appeals of New York, 1917. 220 xV. Y. 162, 115 N. E. 476.) 
 
 Collin, J. The action is upon a promissory note made by the de- 
 fendants' testator. After the note was delivered the maker was ad- 
 judicated a bankrupt, under the federal act of 1898 (Act July 1, 1898, c. 
 541, 30 Stat. 544 [U. S. Comp. St. §§ 9585-9656]), and thereunder 
 received his discharge. A composition was effected, under the provi- 
 sions of the act, between the bankrupt and his creditors. The plaintiff 
 duly accepted the offer of the composition and the 20 per centum of 
 
 3 8 See, also, Trask v. Weeks, ante, p. 421. 
 
 In Porter's Adm'r v. Porter, 31 Me. 169 (1850) the court said: "If any 
 action would lie against the defendant upon a promise to pay the debt in a 
 manner different from that provided iil the original contract, it would be 
 necessary to declare specially on such promise. Penn v. Bennet, 4 Camp. 205 
 (1815). As where the debt was payable in money, and there should be 
 a new promise to pay in specific articles." And see note to Janson v. Colo- 
 more, ante, p. 388. 
 
440 CONSIDERATION ,(Ch. 2 
 
 the face value of the note payable under it. The defendants' testator 
 thereafter wrote to the plaintiff a letter as follows: 
 
 "Troy, N. Y., Dec. 6, 1904. 
 
 "My Dear Sister: Your letter received. Was somewhat surprised 
 at its contents. In regard to your claim against me you will be paid 
 every dollar of it with inst as soon as I sell the mill. If anything hap- 
 pens to me the farm is in my name and you will be paid. I have left 
 orders to that effect. Tell Lester to see what balance there is due me 
 on the books for wood and to pay it to you for inst money. 
 
 "Yours truly, A. W. Davitt." 
 
 The claim mentioned in the letter was the note. The mill referred to 
 in the letter was sold and conveyed by the testator in January, 1907. 
 This action upon the note was commenced June 8, 1912. Upon the 
 trial judgment in favor of the plaintiff for the unpaid balance payable 
 by the terms of the note was ordered. The Appellate Division unan- 
 imously affirmed the consequent judgment. 
 
 The action was properly brought upon the note. For the purpose 
 of the remedy, the original debt might still be considered the cause of 
 action. Dusenbury v. Hoyt, 53 N. Y. 521, 13 Am. Rep. 543.^" It 
 might, had the plaintiff so elected, have been brought upon the new 
 promise. It would be more accurate and consistent with the provi- 
 sions of section 481 of the Code of Civil Procedure and the other sec- 
 tions regulating the pleadings in an action to allege the new promise as 
 the real foundation of the action. The note was a debt provable in 
 the bankruptcy proceedings. The legal obligation which it created or 
 evidenced was, by virtue of the confirmation of the composition offer 
 and the discharge in the proceedings, discharged by force of the stat- 
 ute, and the remedy of plaintiff existing at the time the discharge was 
 granted to recover her debt by action barred. The right of action is 
 given by a new and efficacious promise. The practice of bringing the 
 action upon the original demand is, however, sanctioned by usage. 
 The discharge in bankruptcy is, under such practice, regarded as a 
 discharge of the debt sub modo only, and the new promise as a waiver 
 of the bar to the recovery of the debt created by the discharge. The 
 new promise with such other facts as are essential to constitute it a 
 valid cause of action may, however, be alleged. See Wolffe v. Eberlein, 
 74 Ala. 99, 49 Am. Rep. 809; Taylor v. Hotchkiss, 81 App. Div. 470, 
 80 N. Y. Supp. 1042, affirmed 179 N. Y. 546, 71 N. E- 1140; Scheper v. 
 Briggs, 28 App. Div. 115, 50 N. Y. Supp. 869. 
 
 The appellants assert and argue that the letter of December 6, 1904, 
 does not contain or constitute a promise or agreement to pay the sum 
 unpaid. At its writing, a statute provided : ■ "Every agreement, prom- 
 ise or undertaking i's void, unless it or some note or memorandum there- 
 of be in writing, and subscribed by the party to be charged therewith, or 
 
 s* In accord: Shippey v. Henderson, 14 Johns. (N. Y.) 178, 7 Am. Dec 458 
 (1817). 
 
'Sec. 6) PAST CONSIDERATION 441 
 
 by his lawful agent, 'if suclj agreement, promise or undertaking; 
 * * * 5. Is a subsequent or new promise to pay a debt discharged 
 in bankruptcy. * * * " Personal Property Law (L,aws 1897, c 
 417) § 21. 
 
 The statute has remained in force. Personal property law (Coxisal. 
 Laws, c. 41) § 31. The debtor does not promise to pay the debt dis- 
 charged in bankruptcy, unless there is a distinct and unequivocal ex- 
 pression by him, by a writing of the prescribed form, of a clear in- 
 tention to bind himself to its payment. The acknowledgment of the 
 existence of the debt by the payment of a part of it or of interest upon 
 it or by express written words is not sufficient. For the purpose of 
 creating anew the liability, the law does not imply a promise. The 
 promise need not be made to the creditor, but it must with certainty 
 refer to the debt. No particular form of words need be used. The 
 promise is constituted by words which, in their natural import, ex- 
 press the present intention to obligate or undertake to pay. The pay- 
 ment may, however, depend upon a contingency or condition. If so de- 
 pendent, it must be proved that the contingency has happened or the 
 condition has been iperformed. Lawrence v. Harrington, 122 N. Y. 
 408, 25 N. E. 406; Nathan v. Leland, 193 Mass. 576, 79 N. E. 793; 
 Elwell V. Cumner, 136 Mass. 102; Bigelow v. Norris, 139 Mass; 12, 29 
 N. E. 61; Kraus v. Torry, 146 Ala. 548, 40 South. 956; Meech v. 
 Lamon, 103 Ind. 515, 3 N. E. 159, 53 Am; Rep. 540; Scheper v. Briggs, 
 28 App. Div. 115, 50 N. Y. Supp. 869. A promise made at any time 
 after the adjudication, and, perhaps, after the filing of the petition, is 
 actionable. Zavelo v. Reeves, 227 U. S. 625, 33 Sup. Ct. 365, 57 L. 
 .Ed. 676, Ann. Cas. 1914D, 664; Everett v. Judson, 228 U. S. 474, 
 33 Sup. Ct. 568, 57 L. Ed. 927, 46 L. R. A. (N. S.) 154. 
 
 The letter of the defendant's testator constituted a distinct and un- 
 qualified promise to pay the debt. In effect and in truth it said to the 
 plaintiff, I will pay you every dollar remaining unpaid upon the note, 
 with interest, and will so pay you as soon as I sell the mill. He stated 
 positively that he then undertook and obligated himself to pay. The 
 construction of the words used by the debtors and the conclusions 
 stated in the judicial decisions above cited adequately support such 
 decision. i 
 
 The rule of law is well-nigh universal that such a promise made has 
 an obligating and validating consideration in the moral obligation of 
 the debtor to pay. The debt is not paid by the discharge in bankruptcy. 
 It is due in conscience, although discharged in law, and this moral ob- 
 ligation, tmiting with the subsequent promise to pay, creates a right 
 of action. Dusenbury v. Hoy t, 53 N. Y. 521, 13 Am. Rep. 543. The 
 appellant asserts that the rule does not obtain or have applicability 
 where, as in the present case, there was a composition' between the 
 bankrupt and' his creditors, assented to and accepted by the creditors 
 seeking to enforce the unpaid debt. The clear, weight of judicial- opin- 
 
442 CONSIDERATION • (CIl. 2 
 
 ion and correct reasoning declare such assertion erroneous. In Cohen 
 V. Lachenmaier, 147 Wis. 649, 133 N. W. 1099, the facts, in the par- 
 ticular under consideration, were as are the facts here. The trial court 
 awarded judgment for the balance unpaid on the note. The Supreme 
 Court of Wisconsin in affirming the judgment said: 
 
 "It is further contended that each promise, if made, is nudum pac- 
 tum, because the plaintiff, as one of the creditors, joined with the ma- 
 jority of the creditors in number and amount in accepting the defend- 
 ant's offer of a composition with the creditors in settlement of their 
 claims. This claim is based upon the ground that a discharge in bank- 
 ruptcy in a composition is not a discharge by operation of law but is 
 one effected by the voluntary assent of the creditors. The adjudica- 
 tions are to the effect that a debt which has been extinguished by a 
 voluntary agreement of the debtor and creditor will not support a new 
 promise and that one discharged by operation of law will support one. 
 The proceeding resulting in the discharge of a debtor from liability, 
 based on a composition after bankruptcy proceedings are instituted, is 
 not in its nature such a voluntary act of the creditor as is considered in 
 law as being, a voluntary assent of the creditor to the satisfaction of the 
 debt." 
 
 In Matter of Merriman's Estate, 44 Conn. 587, Fed. Cas. No. 9,479, 
 the court stated the principal question as being "whether an express 
 promise made by a bankrupt to a creditor to pay the amount of his debt 
 is valid, such creditor having theretofore expressly assented to a com- 
 position made and confirmed under the seventeenth section of the 
 amended Bankruptcy Act of June 22, 1874," and carried- into effect and 
 held that the promise was valid. It enunciated that an express promise 
 to pay a debt, which had been theretofore discliarged by operation of 
 law, was valid. The adequate consideration was the moral obligation 
 to keep the original promise; this rule does not apply to a composi- 
 tion inter partes which derives its validity merely from the will of the 
 parties ; and if a debt is legally discharged by the voluntary act of the 
 party, there remains no obligation which can be deemed a considera- 
 tion for a promise; a discharge by performance of the terms of a 
 bankruptcy composition is a discharge by operation of law ; the com- 
 position is as to the assenting creditor both a voluntary act and an act 
 of the law, but its efficiency is derived from the compulsory power 
 of the law. There are^other decisions of like reasoning and effect. 
 Guild V. Butler, 122 Mass. 498, 23 Am. Rep. 378 ; First National Bank 
 of St. Albans v. Wood, 53 Vt. 491 ; Mason & Hamlin Organ Co. v. 
 Bancroft, 1 Abb. N. C. 415 ; Easton Furniture Manfg. Co. v. Caminez, 
 146 App. Div. 436, 131 N. Y. Supp. 157. In Zavelo v. Reeves, 227 U. 
 S. 625, 33 Sup. Ct. 365, 57 L. Ed. 676, Ann. Cas. 1914D, 664, the plain- 
 tiffs accepted the composition offer of the defendant in bankruptcy 
 proceedings.- Thereafter the defendant promised plaintiffs, upon a 
 loan to them of $500, that he would pay the balance of their claim 
 
'Sec. 6) PAST CONSIDERATION MS 
 
 proved in the proceedings. The action was to recover such balance. 
 The plaintiffs recovered. Mr. Justice Pitney in the opinion of the 
 court recognized the general rule that a discharge, while releasing the 
 bankrupt from legal liability to pay a debt that was provable in the 
 bankruptcy, leaves him under a moral obligation that is sufficient to 
 support a new promise to pay the debt, and ignored the composition 
 and its acceptance. The reasoning and the conclusions of those deci- 
 sions are harmonious With and applicable to the provisions of the Bank- 
 ruptcy Act of 1898. ■ ■ 
 
 The case of Taylor v. Skiles, ll3 Tenn. 288, 81 S. W. 1258, con- 
 flicts with the decisions cited and others of like import. Therein it 
 is stated: "It is very generally held that, in th^case of a discharge of 
 a debt under insolvent or bankrupt laws, a subsequent promise to pay 
 by the insolvent or bankrupt will revive the original debt and make 
 it enforceable at law. But it is otherwise where the creditor comes to 
 terms with his debtor under a valid composition, and agrees to, and 
 does, accept a part of his debt for the whole. When this is done, the 
 debt is extinguished. The parties having met on common ground, and 
 agreed on terms of settlement which have been carried out, there is no 
 longer even a moral obligation resting upon the debtor as to the bai- 
 ance of the original liability. So that a new promise after compos- 
 ition is without consideration, and will not afford a cause of action. 
 Warren V.' Whitney, 24 Me. 561 [41 Am. Dec. 406] ; Stafford v. Bacon, 
 1 Hill (N. Y.) 532 [37 Am. Dec. 366] ; Evans v. Bell, 15 Lea [Tenn.] 
 569." 
 
 It is to be noted that the decisions thus cited sustain the proposition 
 that a promise to pay a debt voluntarily discharged is not binding for 
 waiit of a legal consideration, but do not hold that a discharge in bank- 
 ruptcy through a composition is a voluntary release or extinguishment 
 of the debt. 
 
 We do not iind merit in the other grounds for reversal urged by the 
 appellant. 
 
 The judgment should be affirmed, with costs."*" 
 
 Judgment affirmed. ■ 
 
 *»Tliis case Is annotated In 1 A. L. E. 1700, 1704. In accord: Spann v.' 
 Bead Phosphate Co., 238 Fed. 338, 151 C. C. A. 354 (1916) ; Brashears v. 
 Combs, 174 Ky. 344, 192 S. W. 482 (1917). 
 
444 CONSIDERATION (Ch. 2 
 
 WARREN V. WHITNEY. 
 (Supreme Judicial Court of Maine, 1845. 24 Me. 561, 41 Am. Dec. 406f) 
 
 Shepley, J. It appears from the case stated, that the defendants 
 were indebted to the plaintiff before Jan. 16, 1836, on a promissory 
 note ; and that on that day they made an assignment of their property 
 for the benefit of their creditors. The assignment contained a release 
 of all debts due from the defendants to their creditors. The plaintiff 
 became a party to it, and thereby released his debt, and received a divi- 
 dend upon it from the assignees. The defendants, by a contract in writ- 
 ing, made on March 14, 1836, promised to pay the plaintiff any balance 
 of the debt, which might remain unpaid by the assignees. And they 
 afterward paid a small amount of such balance. The plaintiff having 
 voluntarily released his debt upon an agreement to receive his propor- 
 tion of the property conveyed to the assignees, the transaction was 
 equivalent to an accord and satisfaction. There was no longer a sub- 
 sisting debt due from the defendants to the plaintiff; and no consid- 
 eration for the new promise ; unless a moral obligation to pay a debt, 
 which has been discharged by payment of part only, can be con- 
 sidered sufficient. 
 
 This court had occasion to consider and to deny, that a moral 
 obligation can constitute in all cases a legal consideration for a con- 
 tract, and to lay down some rules respecting it, in the case of Farn- 
 ham V. ©'"Brien, 22 Me. 475. It was there stated, that when a person 
 had received a benefit from, or occasioned a loss to, another, and a 
 statute or rule of public policy protected him from making compensa- 
 tion, the moral obligation to do it remained, and would constitute a legal 
 consideration for a promise to do it. When a debt has been volun- 
 tarily discharged, a case is not presented within the rule. The case 
 of Willing V. Peters, 12 Serg. & R. (Pa.) 177, would however au- 
 thorize the plaintiff to recover in this case. The authority of that 
 case must be considered as essentially impaired, if not wholly de- 
 stroyed, by the case of Snevily v. Reed, 9 Watts (Pa.) 396. In the 
 latter case, the plaintiff had discharged the defendant from custody 
 under a ca. sa. ; and thereby dischargee! the debt. The defendant 
 subsequently promised to pay it ; and the Court considered, that there 
 was no legal consideration for the promise.*^ 
 
 The case of Stafford v. Bacon, 1 Hill (N. Y.) 533, 37 Am. Dec. 
 366, decided, that a promise to pay a debt voluntarily discharged, was 
 not binding for want of a legal consideration. 
 
 The counsel for the plaintiff insist upon a distinction, that when 
 the release is made at the request and for the benefit of the debtor, 
 the new promise is binding; and that when not so made, it is not. 
 The case of Valentine v. Foster, 1 Mete. (Mass.) 520,. 35 Am. Dec. 
 
 *i An agreement for forbearance to prosecute further would likewise be na 
 consideration. Herring v. Dorell (Q. B.) 8 Dowling, 604 (1840). 
 
Sec. 6) PAST CONSIDERATION 445 
 
 377, is referred to as establishing such a distinction. It the debt be 
 released for the benefit of the debtor, it is not the less perfectly dis- 
 charged. When a moral obligation has been properly held to con- 
 stitute a legal consideration a plea of accord and satisfaction could 
 not have been supported. The party must have pleaded a statute 
 bar, or facts to bring the case within some rule of public policy 
 forbidding a recovery, such as infancy or coverture. There is little 
 similarity betweein such cases and a case, in which a party could 
 have' plfeaded and have sustained his plea, that he had satisfied and 
 paid the debt. 
 A nonsuit is to be entered.*^ 
 
 STRAUS V. CUNNINGHAM. 
 
 (Supreme Court of New York, Appellate Division, 1913. 159 App. Div. 718, 
 144 N. Y. Supp. 1014.) 
 
 Action by Ferdinand Straus against James W. Cunningham. From 
 an order denying plaintiff's motion for judgment on the pleadings and 
 sustaining a demurrer to the complaint, plaintiff appeals. Reversed. 
 
 Scott, J. The question presented by this appeal is : When will a 
 moral obligation survive the release of a debt by a composition agree- 
 ment so as to furnish a sufficient consideration to support a subse- 
 quent promise to pay the debt ? 
 
 The latest and most comprehensive decision upon this subject in 
 this state is to be found in Taylor v. Hotchkiss, 81 App. Div. 470, 
 80 N. Y. Supp. 1042, affirmed 179 N. Y. 546, 71 N. E. 1140. In that 
 case Mr. Justice Hiscock, writing for the Appellate Division, stated 
 the general rule as follows : 
 
 "If plaintiff, under proceedings in bankruptcy or other involun- 
 tary form, had been compelled to accept the stock received by him 
 in full legal settlement of an indebtedness which it did not in fact 
 actually pay, a moral obligation upon the. part of the debtor to pay 
 the deficiency would have survived his discharge from his legal and 
 enforceable obligations which would be a sufficient consideration for 
 a subsequent promise to pay such balance. Upon the other hand 
 * * * ;if plaintiff, without further agreement or provision by 
 voluntary proceedings of compromise, had accepted the stock in 
 question in full settlement and satisfaction of the indebtedness due 
 to him, no moral obligation on the part of the debtor would have sur- 
 
 *^ In accord: Phelps v. Dennett, 57 Me. 491 (1870) ; Grant v. Porter, 63 N. 
 H. 229 (1884) ; Shepard v. Rhodes, 7 K. I. 470, 84 Am. Dec. 573 (1863) ; 
 Montgomery v. Lampton, 3 Mete. (Ky.) 519 (1861) ; IngersoU v. Martin, 58 
 Md. 67, 42 Am. Rep. 322 (1882). See, also, note, 53 L. R. A. 363: 
 
 In Valentine v. Foster, 1 Mete. (Mass.) 520, 35 Am. Dec. 377 (1840), a new 
 promise to pay made subsequently to a voluntary release, given by the creditor 
 for a purpose of his own, was not enforceable. 
 
446 CONSIDERATION (Ch. 2 
 
 vived which would have furnished an adequate, consideration for a sub- 
 sequent promise to pay." 
 
 That these two propositions, so far as they go, accurately state 
 the law upon the subject, seems to be conceded and, at all events, is 
 well settled. 
 
 There is a third case, however, not precisely covered by either 
 of the foregoing propositions, and that third case is illustrated by 
 Taylor v. Hotchkiss. In that case the firm of H. L. Hotchkiss & 
 Co., being financially embarrassed and unable to pay its debts, made 
 a general assignment. It then sought an adjustment with its creditors 
 and issued a circular letter to them suggesting that they should accept 
 certain stocks and bonds at a valuation of 80 per .cent, of their par 
 value, and should thereupon release the firm so that it might resume 
 business on the Stock Exchange. This was accepted, and a general 
 release executed. In their circular letter Hotchkiss & Co. said : 
 
 "We propose to offer a moral obligation to_ take those securities 
 back from our creditors at 80 at a date not later than April 1, 1895." 
 
 Then followed an explanation as to how the firm proposed to fulfill 
 this moral obligation. Of course, this proposition was intended to, 
 and doubtless did, have an influence in inducing the creditors to exe- 
 cute the composition agreement, although of itself it did not amount 
 to a binding agreement to take the stock back. The court, however, 
 found that after the execution, of the release Hotchkiss renewed by 
 independent agreements his obligation to retake tlie stock at 80. The 
 question was whether a moral obligation arose out of the composition 
 agreement sufficient to serve as a consideration for the new promise. 
 The court held that it did, notwithstanding the composition and re- 
 lease were voluntary acts on the part of the creditors. The court was 
 of the opinion that, even in case of a voluntary composition, the debt- 
 ors may, by their acts, expressly provide for that survival of the moral 
 obligation to pay, in the future, in full the indebtedness compromised 
 which would serve as a sufficient corisideration for a new promise. 
 
 This seems to be a reasonable rule in view of the wide power which 
 individuals have to contract as between themselves. Nor is it neces- 
 sary that the reservation of this moral obligation be so closely inter- 
 woven with the composition agreement as it was in Taylor v. Hotch- 
 kiss. We see no reason why a debtor may not, at the time he accepts 
 a voluntary extinguishment of his debts, expressly reserve a moral 
 obligation to pay in full, if able, which will support a subsequent prom- 
 ise to pay. 
 
 The facts alleged in the complaint in the present case, which for the 
 purpose of this appeal must be taken as true, are that in March, 1905, 
 the firm of Ellingwood & Cunningham owed the plaintiff the sum of 
 $27,000; that said firm entered into a composition agreement with 
 certain of their creditors wherein and whereby said creditors for cer- 
 tain consideration therein expressed agreed to release said firm and 
 the members thereof from all their legal obligation to pay the debts 
 
Sec. 6) PAST CONSIDERATION 447 
 
 and obligations due to said creditors ; that plaintiff signed said agree- 
 ment and became a party thereto. The complaint then proceeds as 
 follows : 
 
 "IV. That prior to and simultaneously with the making of the 
 said agreement, the defendant expressly reserved from the operation 
 of the said agreement and release^ his moral obligation to pay the debt 
 of the plaintiff, amounting, as aforesaid, to the sum of $27,000 and 
 interest, and duly acknowledged and recognized said moral obligation 
 as then existing and continuing to exist thereafter. 
 
 "V. That thereafter and on or about the 19th day of April, 1905, 
 the defendant recognizing his said moral obligation to pay to the 
 plaintiff the said debt of $27,000, and in consideration thereof, did 
 then and there promise that he would pay to the plaintiff the said sum 
 of $27,000 with interest from April 19, 1905, as follows : $8,000 on 
 or about May 22, 1906, and the balance within a year thereafter, the 
 said defendant, however, to be credited on account of said payment 
 with all sums which the plaintiff might receive from the trustees or 
 assignees under said composition agreement. 
 
 "VI. That thereafter, from time to time, the defendant made pay- 
 ments upon account of the said sum agreed to be paid by him, as afore- 
 said, in the amounts and at the times set forth in the annexed schedule, 
 which is marked schedule 'A' and made part thereof as though the 
 same were herein specifically set forth in full, and the plaintiff re- 
 ceived various sums from the trustees or assignees under said compo- 
 sition agreement at the times and in the amounts set forth in said 
 sdiedule 'A'." 
 
 It is also alleged that from time to time plaintiff sent to defendant 
 statements of account which were received and accepted by defend- 
 ant. Attached to the complaint is a schedule showing the payment of 
 several thousand dollars by defendant to plaintiff between June 1, 
 1905, and January 20, 1908. 
 
 Those allegations, as it seems to us, bring the present case fairly 
 within the principle of Taylor v. Hotchkiss. 
 
 It was certainly competent for the defendant to reserve a moral 
 obligation to pay his debt in full, if possible, and perhaps most honor- 
 able men would feel that such an obligation rested upon them. It 
 may well be, although not so alleged, that the defendant's recognition 
 and reservation of this moral obligation had weight with the creditors 
 in consenting to compromise and release the debts. 
 
 The rule is we think satisfied by holding that, unless specially re- 
 served, no moral obligation to pay the debts survives a voluntary com- 
 position and release, but that where at the time of the release the 
 debtor expressly recognizes and reserves a moral obligation to pay 
 notwithstanding the' release, that express reservation keeps alive the 
 obligation after release to the extent that it will furnish a sufficient 
 consideration for a subsequent and quite distinct promise to pay. It 
 is entirely optional with a debtor, under such circumstances, whether 
 
448 CONSIDERATION (Ch, 2 
 
 or not he will reserve a moral obligation, and if he elects to do so we 
 can see no rule of law which is violated by holdiiig that that reserva- 
 tion will support a subsequent promise to pay. 
 
 The appellant devotes no small space in his brief to demonstrating 
 that it does not appear on the face of the complaint that the alleged 
 reservation was a fraud upon other creditors. It is quite clear that it 
 does not so appear, and the respondent expressly disclaims making 
 any such contention, admitting in express terms, as is the undoubted 
 fact, that on the face of the complaint no preference is shown to have 
 been obtained by the plaintiff over any other creditor. 
 
 The order appealed from must therefore be reversed, with $10 costs 
 and disbursements, and plaintiffs' motion for judgment on the plead- 
 ings granted, with $10 costs, with leave to, the defendant to withdraw 
 his demurrer and answer over within 20 days upon payment of all 
 costs of the action.*^ 
 
 BENTLEY V. MORSE. 
 
 (Supreme Court of New York, 1817. 14 Johns. 468.) 
 
 In error, on certiorari to a justice's court. 
 
 The plaintiff in error had an account, for work, against the defend- 
 ant in error, which the latter paid, and took the receipt of the plaintiff 
 in error for $24.90. In November, 1815, the plaintiff in error brought 
 an action against the defendant in error, on his account, and recover- 
 ed judgment. It did not appear that any defence was made. In De- 
 cember, in the same year, the parties happening to be together, the de- 
 fendant observed to the plaintiff, that he had paid him a sum of mon- 
 ey, and held his receipt for it, (alluding to the receipt above mention- 
 ed,) and had been since compelled to pay him a second time; the 
 defendant denied any knowledge of the payment or of giving a re- 
 ceipt, but promised, that if the defendant had such receipt, he would 
 repay him the amount of it. The present action was founded on that 
 promise; and the defendant in error, who was plaintiff in the court 
 below, at the trial, produced the receipt in evidence. The defendant 
 below offered the record of the former judgment in evidence, as, a bar 
 to the action, but it was overruled, and a verdict and judgment were 
 rendered for the defendant in error. 
 
 Per Curiam. In consequence of the omission of the defendant in 
 error, to make a defence in the former action against him, and to pro- 
 duce his receipt to show the payment of the debt, he was forever bar- 
 red from maintaining an action to recover back the money he had 
 paid; and the question now is, whether the promise to repay the 
 amount of the money expressed in the receipt is valid in law. 
 
 The debt having been paid, the recovery in the former action was 
 
 *8 Tbe concurring opinion of Ingraham, P. J., is omitted. 
 
Sec. 6) PAST CONSIDEKATION 449 
 
 clearly unjust ; and though, in consequence of his neglect, the defend- 
 ant in error lost all legal remedy to recover back his money ; yet there 
 was such a moral obligation, on the part of the plaintiff in error, to re- 
 fund the money, as would be a good consideration to support an as- 
 sumpsit or express promise to pay it. The moral obligation is as 
 strong as any in the cases in which it has been held sufficient to re- 
 vive a debt barred by statute or some positive rule of law. It is like 
 the promise of an infant to pay a debt contracted during his non-age, 
 or of an insolvent or bankrupt to pay a debt from which he is dis- 
 charged by his certificate.** 
 Judgment affirmed. 
 
 BINNINGTON v. WALLIS. 
 
 (Court of King's Bench, 1821. 4 Barn. & Aid. 650, 106 Eng. Rep. 1074.) 
 
 Declaration stated, that before the making of the promise and un- 
 dertaking, the plaintiff had cohabited with the defendant as his mis- 
 tress ; and an immoral connexion and intercourse had existed between 
 them for a long space of time, to wit, for the space of twelve years ; 
 and the plaintiff had thereby been greatly injured in her character and 
 reputation, and deprived of the means of honestly procuring a liveli- 
 hood; and that, before the time of the making of the promise, to wit, 
 on the 1st of January, 1816, at, &c. the plaintiff wholly ceased to co- 
 habit with the said defendant, as his mistress, and to have any immoral 
 intercourse with her, and thereupon it was determined and agreed be- 
 tween them, that no immoral intercourse or connexion should ever 
 again take place between them ; and that the defendant, as a compensa- 
 tion for the injury so sustained by the plaintiff, should pay and allow to 
 the plaintiff, the quarterly sum of £10, while she should be and continue 
 of good and virtuous life, conversation, and demeanour; and there- 
 
 ^* Lord Mansfield laid it down as a general rule that a moral obligation is 
 a sufficient consideration for a subsequent express promise. In Hawkes v. 
 Saunders, Cowper, 289 (1782), he said: "Where a man is under a moral 
 obligation, which no court of law or equity can enforce and promises, the 
 honesty and rectitude of the thing is a consideration." See, also, Watson v. 
 Turner, Buller N. P. 129 (1767)'. 
 
 In a few states the same general rule has been laid down, either by statute 
 or by the courts. See Ga. Code 1895, § 3658; Gray v. Hamil, 82 Ga. 375, 
 10 S. E. 205, 6 L. E. A. 72 (1889) ; Bobinson v. Hurst, 78 Md. 59, 26 At). 95(5, 
 20 L. R. A. 761, 44 Am. St. Rep. 266 (1893) ; Holden v. Banes, 140 Pa. 68, 21 
 Atl. 239 (1891) ; Spear v. Griffith, 86 111. 552 (1877) ; Olson v. Hagan, 102 
 Wash. 321, 172 Pac. 1173 (1918). The cases antecedent hereto show the 
 extent to which a moral obligation is regarded as a consideration in other 
 states. 
 
 A bare promise without consideration, past or present, creates no moral 
 obligation, and a subsequent note op promise in renewal thereof creates no 
 legal duty. Monroe v. Martin, 137 GaT 262, 73 S. E. 341 (1911) ; Parsons v. 
 Teller, 188 N. Y. 318, 80 N. E. 930 (1907) ; Nutter v. Stover, 48 Me. 163 
 (1859) ; Smith v. Taylor, 39 Me. 242 (1855). 
 
 COBBIN CONT 29 
 
■L50 CONSIDERATION (Cll. 2 
 
 upon, in consideration of the premises; and that the plaintiff, at the 
 request of the defendant, would resign and give up the said quarterly 
 sum, he undertook to pay her so much money as the said quarterly 
 sum was reasonably worth, in order to enable her to continue to live 
 in a virtuous and decorous manner. The declaration then averred, 
 that the plaintiff did resign and give up the said quarterly sum, and 
 the same from thence wholly ceased and determined ; and that she 
 had always, from the time of the cessation of the immoral connexion 
 lived in a virtuous and decorous manner, and been of virtuous life, 
 conversation, and demeanour. It then averred, that the quarterly sum 
 was reasonably worth £400 ; and then alleged as a breach, nonpayment 
 by the defendant. The other counts omitted any mention of the quar- 
 terly allowance, and in other respects were similar to this. To this 
 declaration, there was a general demurrer. 
 
 Per CtJRiAM. The declaration is insufficient. It is not averred that 
 the defendant was the seducer, and there is no authority to shew that 
 past cohabitation alone, or the ceasing to cohabit in future, is a good 
 consideration for a promise of this nature. The cases cited are dis- 
 tinguishable from this, because they are all cases of deeds, and it is a 
 very different question, whether a consideration be sufficiently good 
 to sustain a. promise, and whether it be so illegal as to make the deed 
 which required no consideration void. There must therefore be judg- 
 ment for the defendant. 
 
 Judgment for defendant.*' 
 
 MILLS V. WYMAN. 
 (Supreme Judicial Court of Massachusetts, 1825. 3 Pick. 207.) 
 
 This was an action of assumpsit brought to recover a compensation 
 for the board, nursing, &c., of Levi Wyman, son of the defendant, 
 from the 5th to the 20th of February, 1821. The plaintiff then lived 
 at Hartford, in Connecticut; the defendant, at Shrewsbury, in this 
 county. Levi Wyman, at the time when the services were rendered, 
 was about 25 years of age, and had long ceased to be a member of 
 his father's family. He was on his return from a voyage at sea, and 
 being suddenly taken sick at Hartford, and being poor and in dis- 
 tress, was relieved by the plaintiff in the manner jind to the extent above 
 stated. On the 24th of February, after all, the expenses had been in- 
 curred, the defendant wrote a letter to the plaintiff, promising to pay 
 him such expenses. There was no consideration for this promise, ex- 
 
 *5In accord:' Beaumont v. Keeve, 8 Q. E. 483 (1846). 
 
 But a release from a valid engagement to marry in a cuse of this sort is a 
 sufficient consideration. Henderson v. Spratlen, 44 Colo. 278, 98 Pac. 14, 19 
 L. R. A. (N. S.) 655 (1908). See, also, Jennings v. Brown (Exch.) 9' M 
 & W. 496 (1842). 
 
Sec. 6) PAST CONSIDERATION 451 
 
 cept what grew out of the relation which subsisted 'between Levi Wy- 
 man and the defendant, and Howe, J., before whom the cause was tried 
 in the court of common pleas, thinking this not sufficient to support the 
 action, directed a nonsuit. To this direction the plaintiff filed excep- 
 tions. 
 
 Parker, C. J. General rules of law established for the protection 
 and security of honest and fair-minded men, who may inconsiderately 
 make promises without any equivalent, will sometimes screen men of 
 a different character from engagements which they are bound in foro 
 conscientise to perform. This is a defect inherent in all human systems 
 of legislation. The rule that a mere verbal promise, without any con- 
 sideration, cannot be enforced by action, is universal in its application, 
 and cannot be departed from to suit particular cases in which a refusal 
 to perform such a promise may be disgraceful. 
 
 The promise declared on in this case appears to have been made 
 without any legal consideration. The kindness and services towards 
 the sick son of the defendant were not bestowed at his request. The 
 son was in no respect under the care of the defendant. He was twenty- 
 five years old, and had long left his father's family. On his return 
 from a foreign country, he fell sick among strangers, and the plaintiff 
 acted the part of the good Samaritan, giving him shelter and Comfort 
 until he died. The defendant, his father, on being informed of this 
 event, influencedby a transient feeling of gratitude, promises in writing 
 to pay the plaintiff for the expenses he had incurred. But he has de- 
 termined to break this promise, and is willing to have his case appear 
 on record as a strong example of particular injustice sometimes neces- 
 sarily resulting from the operation of general rules. 
 
 It is said a moral obligation is a sufficient consideration to support 
 an express promise ; and some authorities lay down the rule thus broad- 
 ly; but upon examination of the cases we are satisfied that the uni- 
 versality of the rule cannot be supported, and that there must have 
 been some preexisting obligation which has become inoperative by pos- 
 itive law, to form a basis for' an effective promise. The cases of 
 debts barred by the statute of litmitations, of debts incurred by in- 
 fants, of debts of bankrupts, are generally put for illustration of the 
 rule. Express promises founded on such preexisting equitable obli- 
 gations may be enforced; there is a good consideration for them; 
 they merely remove an impediment created by law to the recovery of 
 debts honestly due, but which pubhc policy protects the debtors from 
 being compelled to pay. In all these cases there was originally a quid 
 pro quo; and according to the principles of natural justice the party 
 receiving ought to pay; but the legislature has said he shall not be 
 coerced ; then comes the promise to pay the debt that is barred, the 
 promise of the man to pay the debt of the infant, of the discharged 
 bankrupt to restore to his creditor what by the law he had lost. In all 
 these cases there is a moral obligation founded upon an antecedent val- 
 
452 CONSIDBKATION (Ch. 2 
 
 uable consideratioiS.' Th^se promises therefore have a sound legal basis. 
 They are not promises to pay something for nothing ; not naked pacts ; 
 but the voluntary revival or creation of obligation which before exist- 
 ed in natural law, but which had been dispensed ' with, not for the 
 benefit of the party obliged solely, but principally for the public con- 
 venience. If moral obligation, in its fullest sense, is a good substratum 
 for an express promise, it is not easy to perceive why it is not equally 
 good to support an implied promise. What a man ought to do, gen- 
 erally he ought to be made to do, whether he promise or refuse. But 
 the law of society has left most of such obligations to the interior 
 forum, as the tribunal of caascience has been aptly called. Is there 
 not a moral obligation upon every son who has become affluent by 
 means of the education and advantages bestowed vipon him by his 
 father, to relieve that father from pecuniary embarrassment, to pro- 
 mote his comfort and hapf«ness, and even to share with him his riches, 
 if thereby he will be made happy ? And yet such a son may; with im- 
 punity, leave such a father in any degree of penury above that which 
 will expose the community in which he dwells, to the danger of being 
 obliged to preserve him from absolute want. Is not a wealthy father 
 under strong moral obligation to advance the interest of an obedient, 
 well disposed son, to furnish him with the means of acquiring and 
 maintaining a becoming rank in life, to rescue him from the horrors 
 of debt incurred, by misfortune ? Yet the law will uphold him in any 
 degree of parsimony, short of that which would reduce his son to the 
 necessity of seeking public charity. 
 
 Without doubt there are great interests of society which justify withr 
 holding the coercive arm of the law from these duties of imperfect 
 obligation, as they are called ; imperfect, not because they are less 
 binding upon the conscience than those which are called perfect, but 
 because the wjsdom of the social law does not impose sanctions upon 
 them. 
 
 A deliberate promise, in writing, made freely and without any mis- 
 take, one which may lead the party to whom it is made into contracts 
 and expenses, cannot be broken without a violation of moral duty. But 
 if there was nothing paid or promised for it, the law, perhaps wisely, 
 leaves the execution of it to the conscience of him who makes it. It 
 is only when the party making the promise gains something, or he to 
 whom it is made loses something, that the law gives the promise va- 
 lidity. And in the case of the promise of the adult to pay the debt of 
 the infant, of the debtor discharged by the statute of limitations or 
 bankruptcy, the principle is preserved by looking back to the origin 
 of the transaction, where an equivalent is to be found. An exact equiv- 
 alent is- not required by the law ; for there being a consideration, the 
 parties are left to estimate its value : though here the courts of eq- 
 uity will step in to relieve from gross inadequacy between the con- 
 sideration and the promise. 
 
Sec. 6) PAST CONSIDERATION 453 
 
 These principles are deduced from the general current of decided 
 cases upon the subject as well as from the known maxims of the com- 
 mon law. The general position, that moral obligation is a sufficient 
 consideration for an express promise, is to be limited in its application, 
 to cases where at some time or other a good or valuable considera- 
 tion has existed. 
 
 A legal obligation is always a sufficient consideration to support either 
 an express or an implied promise; such as an infant's debt for neces- 
 saries, or a father's promise to pay for the support and education of 
 his minor children. But when the child shall have attained to manhood, 
 and shall have become his own agent in the world's business, the debts 
 he incurs, whatever may be their nature, create no obligation upon the 
 father ; and it seems to follow, that his promise founded upon such a 
 debt has no legally binding force. 
 
 The cases of instruments under seal and certain mercantile con- 
 tracts, in which considerations need not be proved, do not contradict 
 the principles above suggested. The first import a consideration in 
 themselves, and the second belong to a branch of the mercantile law, 
 which has found it necessary to disregard the point of consideration 
 in respect to instruments negotiable in their nature and essential to the 
 interests of commerce. 
 
 Instead of citing a multiplicity of cases to support the positions I 
 have taken, I will only refer to a very able review of all the cases in 
 the note in 3 BoS. & P. 249. The opinions of the judges had been vari- 
 ant for a long course of years upon this subject, but there seems to 
 be no case in which it was nakedly decided, that a promise to pay the 
 debt of a son of full age, not living with his father, though the debt 
 were incurred by sickness which ended in the death of the son, with- 
 out a previous request by the father proved or presumed, could be en- 
 forced by action. 
 
 It has been attempted to show a legal obligation on the part of the 
 defendant by virtue of our statute, which compels lineal kindred in 
 the ascending or descending line to support such of their poor rela- 
 tions as are likely to become chargeable to the town where they have 
 their settlement. But it is a sufficient answer to this position, that 
 such legal obligation does not exist except in the very cases provided 
 for in the statute, and never until the party charged has been adjudged 
 to be of sufficient ability thereto. We do not know from the report any 
 of the facts which are necessary to create such an obligation. Whether 
 the deceased had a legal settlement in this commonwealth at the time 
 of his death, whether he was likely to become chargeable had he lived, 
 whether the defendant was of sufficient ability, are essential facts to be 
 adjudicated by the court to which is given jurisdiction on this subject. 
 The legal liability does not arise until these facts have all been as- 
 certained by judgment, after hearing the party intended to be charged. 
 
 For the foregoing reasons we are all of opinion that the nonsuit di- 
 
454 CONSIDERATION (Ch, 2 
 
 rected by the court of common pleas was right, and that judgment be 
 entered thereon for costs for the defendant.*" 
 
 *« Moral obligation, so called, and the facts causing such moral obligation, 
 are generally stated not to be a sufficient consideration. Cook v. Bradley, 
 7 Conn. 57, 18 Am. Dec. 79 (1828) ; Inhabitants of Freeman v. Dodge, 98 Me. 
 531, 57 Atl. 884, 66 L. R. A. 395 (1904), promise of son to reimburse a town 
 for supporting his mother ; Schwerdt v. Schwerdt, 235 111. 386, 85 N. E. 613 
 (1908) ; Rask v. Norman, 141 Minn. 198, 169 N. W. 704 (1918) ; Strevell v. 
 Jones' Estate, 106 App. Div. 334, 94 N. Y. Supp. ,627 (1905) ; Eastwood t. 
 Kenyon, 11 A. & B. 438 (1840) ; notes in 53 L. R. A. 353, 3 L. R. A. (N. g.) 
 436, 7 L. R. A. (N. S.) 1048, and 26 L. R. A. (N. S.) 520. 
 
 In Davis & Co. v. Morgan, 117 Ga. 504, 43 S. E. 732, 61 L. R. A. 148, 97 
 Am. St. Rep. 171 (1903) , the court said : "No benefit accrued to him who made 
 the promise, nor did any injury flow to him who received it. Such promises 
 are not made within the scope of transactions intended to confer rights en- 
 forceable at law. They are lightly made, dictated by generosity, courtesy, or 
 impulse, often by ruinous prodigality. To enforce them by a judgment in 
 favor of those who gave nothing therefor would often bring such imperfect 
 obligations into competition with the absolute duties to wife and children, or 
 into competition with debts for property actually received, and make the law 
 an instrument by which a man could be forced to be generous before he was 
 just." 
 
Ch. 3) CONTRACTS UNDEE SEAL 455 
 
 CHAPTER III 
 CONTRACTS UNDER SEAL 
 
 Deed [Defined in Termes dE la Ley, 149-152]. Translated in the 
 first American edition from the London edition of 1721. 
 
 Deed is a writing sealed and delivered, to prove and testify the 
 agreement of the party whose deed it is to the thing contained in the 
 deed; as a deed of feoffment is a proof of the livery of seisin, for 
 the land passes by the livery of seisin ; but when the deed and the de- 
 livery are joined together, that is a proof of the livery, and that the 
 feoffor is contented that the feoffee shall have the land. 
 
 All deeds are either indented, 'whereof there are two, three, or more 
 parts, as the case requires ; of which the feoffor, grantor, or lessor hath 
 one; the feoffee, grantee, or lessee another; and peradventure some 
 other body a third, &c. Or else they are poll deeds, single, and but 
 one, which the feoffee, grantee, or lessee hath, &c. And every deed 
 consists of three principal points, (without which it is no perfect deed 
 to bind the parties) naniely, writing, sealing, and delivery. 
 
 1. By writing is shewed the parties' names to the deed, their dwell- 
 ing places, their degrees, the thing granted, upon what considerations, 
 the estate limited, the time when it was granted, and whether simply, 
 or upon condition, with other such like circumstances. But' whether 
 the parties to the deed write in the end their names, or set to their 
 marks, (as it is commonly used) it matters not at all, (as I think) for 
 that is not meant, where it is said, that every deed ought to have 
 writing. 
 
 2. Sealing is a farther testimony of their consents to what is con- 
 tained in the deed ; as it appears in these words. In witness whereof, 
 &c. or to such effect, always put in the latter end of deeds, without 
 which words the deed is insufficient. 
 
 And because we are about sealing and signing of deeds, it shall 
 not be much amiss here to shew you, for antiquity's sake, the manner 
 of signing and subscribing deeds in our ancestors the Saxons' time, a 
 fashion differing from that we use now, in this, that they to their 
 deeds subscribed their names, (commonly adding the sign of the cross) 
 and in the end did set down a great number of witnesses, not using 
 at that time any kind of seal ; and we at this day, for more surety, 
 both subscribe our. names, (though that be not very necessary) and put 
 to our seals, and use the help of witnesses besides. 
 
 That the former fashion continued absolute until the time of the 
 conquest by the Normans, whose manners by little and little at the 
 length prevailed amongst us ; for the first sealed charter in England, 
 is thought to be that of king Edward the Confessor, to the abbey of 
 Westminster, who being educated in Normandy, brought into the realm 
 
456 CONTRACTS UNDER SEAL (Ch. 3 
 
 tliat and some other of their fashions with him. And after the com- 
 ing of William the Conqiieror, the Normans liking their own country 
 custom, (as naturally all nations do) rejected the manner ,that they 
 found here, and retained their own, as Ingulphua the abbot of Croi- 
 land, who came in with the conquest witnesses, saying: "The Nor- 
 mans do change the making of writings (which were wont to be firm- 
 ed in England with crosses of gold, and other holy signs) into an im- 
 pression of wax, and reject also the manner of the English writing." 
 Howbeit, this was not done all at once, but it increased and came 
 forward by certain degrees; so that first and for a season the king 
 only or a few other of the nobility, used to seal; then the noblemen, 
 for the most part, and none other. Which thing a man may see. in the 
 history of Battle-Abby, where Richard Lucie, chief justice of Eng- 
 land, in the time of king Henry II, is reported have blamed a mean 
 subject for that he used a private seal, whereas that pertained (as he 
 said) to the king and nobility only. 
 
 At which time also, as J. Rosse notes it, they used to engrave in 
 their seals their own pictures and counterfeits, covered with a long 
 coat over their armours. But after this, the gentlemen of the better 
 sort took up the fashion, and because they were not all warriors, they 
 made seals engraven with their several coats or shields of arms, for 
 difference sake, as the same author reports. At length about the time 
 of Edward III seals became very common; so that not only such as 
 bear arms used to seal, but other men also fashioned to themselves 
 signets of their own devices, some taking the letters of their own 
 names, some flowers, some knots and flourishes, some birds and 
 beasts, and some other things, as we now yet daily see used. 
 
 Some other manners of sealings besides these have been heard of 
 among us ; as namely, that of king Edward III, by which he gave to 
 Norman the Hunter, 
 
 The hop and the h6p town, ^ 
 
 With all the bounds upside down: 
 
 And in witness that it was sooth, 
 
 He bit the wax with his fore tooth. 
 The like to this was shewed me by one of my friends in a loose 
 paper, but not very anciently written, and therefore he willed me to 
 esteem of it as I thought good. It was as follows : 
 
 "I, William, King, give to thee Plowden Royden, my hop and hop 
 lands, with all the bounds up and down, from heaven to earth, from 
 earth to hell for thee and thine to dwell, from me and mine, to thee 
 and thine, for a bow and a broad arrow, when I come to hunt upon 
 yarrow. In witness that this is sootli, I bite this wax with my tooth, 
 in the presence of Magge, Maud, and Margery, and my third son 
 Henry." ^ 
 
 1 A practice of this sort is referred to in Lacey v. Hutchinson, 5 6a App 
 865, 64 S. E. 105 (1909). 
 
Ch. 3) CONTRACTS UNDER SEAL 457 
 
 Also that of Alberick de Vere, containing the donation of Hatfield, 
 to which he affixed a short black-hafted kni-fe like an old halfpenny 
 whittle, insead of a seal: with divers such like. 
 
 But some peradventure will think, that these were received in com- 
 mon use and custom, and that they were not the devices and pleasures 
 of a few singular persons : such are no less deceived than they that 
 deem every charter and writing, that hath no seal annexed, to be as 
 ancient as the conquest; whereas indeed sealing was not commonly 
 used till the time of king Edward III, as hath been already said. 
 
 3. Delivery, though it be set last, is not the least; for after a deed 
 is written and sealed, if it be not delivered, all the rest is to no pur- 
 pose. 
 
 And this delivery ought to be done by the party himself, or his 
 sufficient warrant ; and so it will bind him whosoever wrote or seal- 
 ed the same: and by this last act the deed is made perfect, according 
 to the intent and effect of it ; and therefore, in deeds, the delivery is 
 to be proved, &c. 
 
 Thus you see, writing, and sealing, without delivery, is nothing to 
 purpose: sealing and delivery, where there is no writing, work noth- 
 ing: and writing and delivery without sealing, make no deed. There- 
 fore they all ought jointly to concur to make a perfect deed." 
 
 WARREN V. LYNCH; 
 (Supreme Court of Judicature of New York, 1810. 5 Johns. 239.) 
 
 This was an action of assumpsit brought by the plaintiff, as the 
 first endorser of a promissory note, against the defendant as maker. 
 The note was as follows : i 
 
 "Petersburg, Va., August 27, 1807. 
 
 "Four months after date I promise to pay Hopkins Robertspn or 
 order, the sum of $719,121/^ cents, witness my hand and seal. Pay- 
 able in New York. Thomas Lynch. [L,. S.]" 
 
 The flourish and initials L. S- at the end of the maker's name con- 
 stituted what was called his seal. The defendant pleaded non as- 
 sumpsit, with notice of special matter to be given in evidence at the 
 trial. * * * 
 
 On this evidence the judge was of opinion that the plaintiff was 
 entitled to recover, and under his direction the jury found a verdict 
 for the plaintiff for the amount of the note with interest. 
 
 Kent, C. J.^ * * * 1. The note was given in Virginia, and by 
 
 2 Recognizances.— As to the manner of executing a formal recognizance by 
 parol in open court, see Albrecht v. State, 132 Md. 150, 103 Atl. 443 (1918). 
 See, also, State v. Chandler, 79 Me. 172, 8 lAtl. 553 (1887) ; McNamara v. 
 People, 183 111. 164, 55 N. B. 625 (1899) ; Bodine v. Commonwealth, 24 Pa. 69 
 (1854). 
 
 3 Parts of the report are omitted. 
 
458 CONTRACTS UNDER SEAL (Ch. 3 
 
 the laws of that State it was a sealed instrument or deed, i But it was 
 made payable in New York, and according- to a well-settled rule, it is 
 to be tested and governed by the law of this State. Thompson v. 
 Ketcham, 4 Johns. 285. Independent then of the written agreement 
 of the parties (and on the operation of which some doubt might pos- 
 sibly arise), this paper must be taken to be a promissory note, without 
 seal, as contradistinguished from a specialty. We have never adopt- 
 ed the usage prevailing in Virginia and in some other States, of sub- 
 stituting a scrawl for a seal; and what was said by Mr. Justice Liv- 
 ingston, in the case of Meredith v. Hinsdale, 2 Caines, 362, in fa- 
 vor of such a substitute, was his own opinion and not that of the 
 court. A seal, according to Lord Coke (3 Inst. 169), is wax with an 
 impression. Sigillum est cera impressa, quia cera sine impressione non 
 est sigillum. 
 
 A scrawl with a pen is not a seal, and deserves no notice. The 
 law has not indeed declared of what precise materials the wax shall! 
 consist; and whether it be a wafer or any other paste or matter suf- 
 ficiently tenacious to adhere and receive an impression, is perhaps not 
 material. But the scrawl has no one property of a seal. Multum 
 abludit iniagO. To adopt it as such would be at once to abolish the 
 immemorial distinction between writings sealed and writings not sealed. 
 Forms will frequently, and especially when they are consecrated by 
 time and usage, become substance. The calling a paper a deed will 
 not make it one if it want the requisite formalities. "Notwithstand- 
 ing," says Perkins (§ 129), "that words obligatory are written on 
 parchment or paper, and the obligor delivereth the same as his deed, 
 yet if it be not sealed, at the time of the delivery, it is but an escrowl, 
 though the name of the obligor be subscribed." I am aware that 
 ingenious criticism may be indulged at the expense of this and of 
 many of our legal usages, but we ought to require evidence of some 
 positive and serious public inconvenience before we, at one stroke, 
 annihilate so well-established and venerable a practice as the use of 
 seals in the authentication of deeds. The object in requiring seals, 
 as I humbly presume, was misapprehended both by President Pendle- 
 ton and by Mr. Justice Livingston. It was not, as they seem to sup- 
 pose, because the seal helped to designate the party who affixed it 
 to his name. Ista ratio nullius pretii (says Vinnius, in Inst. 2, 10, 
 5) nam et alieno annulo signare licet. Seals were never introduced 
 or tolerated in any code of law, because of any family impression 
 or image or initials which they might contain. One person might al- 
 ways use another's seal, both in the English and in the Roman law.* 
 
 * In accord: Ball v. DunsterviUe, 4 T. R. 313, 100 B. R. 1038 (1791), one 
 partner attached a seal for both in the other's presence. And where the in- 
 .strument purports in Its own terms to be under the hands and seals of the par- 
 ties, they win all be presumed to have adopted the single seal appearing there- 
 on. Ryan v. Cooke, 172 111. 302, 50 N. E. 213 (1898) ; Hiett v. Turner-Hudnut 
 Co., 182 lU. App. 524 (1913) ; Davis v. Burton, 3 Scam. (4 111.) 41, 36 Am. 
 
Ch. 3) CONTRACTS UNDER SEAL 459 
 
 The policy of the rule consists in giving ceremony and solemnity to 
 the execution of important instruments, by means of which the at- 
 tention of the parties is more certainly and effectually fixed and 
 frauds less likely to be practised upon the unwary. President Pen- 
 dleton, in the case of Jones and Temple v. Logwood, 1 Wash. (Va>) 
 42, which was cited upon the argument, said that he did not know 
 of any adjudged case that determines that a seal must necessarily 
 be something impressed on wax; and he seemed to think that there 
 was nothing but Lord Coke's opinion to govern the question. He 
 certainly could not have examined this point with his usual diligence. 
 The ancient authorities are explicit, that a seal does', in legal contem- 
 plation, mean cm impression upon wax. "It is not requisite," accord- 
 ing to Perkins (§ 134), "that there be for every grantor who is named 
 in the deed a several piece of wax, for one piece of wax may serve 
 for all the grantors if every one put his seal upon the same piece of 
 wax." And Brooke (tit. Faits, 30 and 17) uses the same language. 
 In Lightfoot and Butler's Case, which was in the Exchequer, 29 Eliz. 
 (2 Leon. 21) the Barons were equally explicit as to the essence of .a 
 seal, though they did not all concur tipon the point, as stated in Per- 
 kins. One of them said that twenty men may seal with one seal 
 upon one piece of wax only, and that should serve for them all, if 
 they all laid their hands upon the seal; but the other two Barons 
 held that though they might all seal a deed with one seal, yet it 
 must be upon several pieces of wax. Indeed this point, that the seal 
 was an impression upon wax, seems to be necessarily assumed and 
 taken for granted in several other passages which might be cited 
 from Perkins and Brooke, and also in Mr. Selden's Notes to For- 
 tescue (De Laud. p. 72) ; and the nature of a seal is no more a mat- 
 ter of doubt in the old English law than it is that a deed must be 
 written upon paper or parchment, and not upon wood or stone. Nor 
 has the common law ever been altered in Westminster Hall up- 
 on this subject, for in the late case of Adam v. Keer, 1 Bos. & Puller, 
 360, it was made a question whether a bond executed in Jamaica, 
 with a scrawl of the pen, according to the custom of that island, 
 should operate as such in England, even upon the strength of that 
 usage. 
 
 The civil law understood the distinction and solemnity of seals as 
 well as the common law of England. Testaments were required not 
 only to be subscribed, but to be sealed by the witnesses. Subscrip- 
 
 Dec. 511 (1841) ; Lord Lovelace's Case, W. Jones, 268 (1643) ; and note in 
 20 Ann. Cas. 1327 ; Cf. Baltimore Pearl Hominy Co. v. Linthicum, 112 Md. 27, 
 75 Atl. 737, 136 Am. St. Kep. 383, 20 Ann. Cas. 1825 (1910) ; Hess' Estate, 150 
 Pa. 346, 24 Atl. 676 (1892). 
 
 "Nota, that It was held by all the Justices that where the obligation upon 
 which suit was brought read, In cujus rei testim' sigiUum apposui, the deed is 
 good even though the word meum is omitted, because if the deed is delivered 
 it is a good deed, whether the seal is his own seal or the seal of another." Y. 
 B. 21 Edw. IV, 81, 30. 
 
460 CONTRACTS UNDER SBAL (Ch. 3 
 
 tione testium, et ex edicto prastoris, signacula testamentis imponerentur 
 (Inst. 2, 10, 3). The Romans generally used a ring, but the seal was 
 valid in law, if made with one's own or another's ring; and, ac- 
 cording to Heineccius (Elementa juris civilis secundum ord., Inst. 
 497), with any other instrument which would make an impression, and 
 this, he says is the law to this day throughout Germany. And let 
 me add that we have the highest and purest classical authority for 
 Lord Coke's definition of a seal. Quid si in ejusmodi cera centum 
 sigilla hoc annulo impressero? (Cicero. Academ. Quaest. Lueul. 4, 
 26.) * * * 
 Rule refused." 
 
 JACKSON V. SECURITY MUT. LIFE INS. CO. 
 
 (Supreme Court of Illinois, 1908. 233 lU. 161, 84 N. E. 198.) 
 
 Action by Isabella H. Jackson against the Security Mutual Life 
 Insui-jmce Company. Judgment for defendant, affirmed by the Appel- 
 late Court, and plaintiff appeals. Affirmed.* 
 
 This is an appeal from a judgment of the Appellate Court affirming 
 the judgment of the circuit court of Cook county in an action in 
 assumpsit brought by appellant to recover from appellee a. balance of 
 $7,500 alleged to be due upon an insurance policy for $10,000, issued 
 November 17, 1897, upon the life of her husband, William S. Jack- 
 son. * * * Appellee pleaded, in addition to the general issue, 
 a release by appellant, for $2,500, of all claims under the policy ; that 
 the policy was issued in consideration of a written application by 
 the insured, which appellee's officers, after the death of the insured, 
 were led by certain information to believe contained divers false 
 representations ; that appellee in good faith believed it had a complete 
 defense to all claims and entered into the agreement with appellant 
 
 5 In accord "at common law" : Woodbury v. United States Casualty Co., 
 284 111. 227, 120 N. E. 8 (1918). 
 
 In many states it is provided by statute that a scroll or other device veith 
 the pen shall be sufficient. Stimson, Am. St. Law, §§ 1564-5. In New York 
 the word "seal" or the letters "L. S." (locus sigilli), or anything affixed by an 
 adhesive substance, may be used. N. Y. Statutory Construction Law (Consol. 
 Laws, c. 22) § 13. 
 
 In other states the earlier common-law rule has been changed by judicial 
 decision, following changes in local custom : Lorab v. Nissley, 156 Pa. 329, 
 27 Atl. 242 (1893) ; Hacker's Appeal, 121 ^Pa. 192, 15 Atl. 500, 1 L. K. A. 861 
 (1888). In Alexander v. Jameson, 5 Bin. (Pa.) 238, 244 (1812), Braeken- 
 rldge, J., said : "lUi robur et sas triplex. He was a bold fellow who first in 
 these colonies, and particularly in Pennsylvania, in time whereof the memory 
 of man runneth not to the contrary, substituted the appearance of a seal by 
 the circumflei^ of a pen, which has been sanctioned by usage and the adjudi- 
 cation of the courts, as equipollent with a stamp containing some effigies or 
 inscription on stone or metal. * * * How could a jury distinguish the 
 hieroglyphic or circumflex of a pen by one man from another? In fact the 
 circumflex is usually made by the scrivener drawing the instrument, and the 
 word 'seal'i inscribed within it." 
 
 « Parts of the report are omitted. 
 
Ch. 3) CONTRACTS UKDEB SEAL 461 
 
 to compromise said claims for $2,500, which sum was paid in full 
 satisfaction of all claims and the policy, surrendered. After both par- 
 ties had introduced their evidence, the jury, under an instruction from 
 the court, returned a verdict in favor of appellee. At the time of the 
 settlement appellant gave a receipt to appellee's respresentative, H. 
 J. McCormick, as follows: 
 
 ^ "Chicago, 111., Nov. 1,8, 1898. 
 
 "Received of the Security Mutual Life Association twenty-five hun- 
 dred dollars, in full release of all claims under this poUcy No. 22,819 
 on the life of William S. Jackson. 
 
 "Isabella H. Jackson. [Seal.] "I 
 
 "Widow of William S. Jackson. Seal, f Beneficiary. 
 
 " "Seal. J 
 
 "Witness: Adelor J. Petit, 
 
 "H. J. McCormick." 
 
 It is admitted that the word "seal" after the name of appellant 
 was on the receipt before she signed it, but the evidence is conflict- 
 ing as to whether the scrawl or irregular ink line about the word 
 "seal," indicated above by brackets, was also there at that time. 
 
 Carter, j. * * * Appellant insists that the scrawl or irregu- 
 lar ink mark around the word "seal" after her name on the release 
 was placed there after she signed it. McCormick testified that he 
 put the scrawl about the word "seal" at the same time he filled in 
 the body of the release and dated it, and that this was done before it 
 was signed by the appellant. Even though it should be admitted that 
 the scrawl was placed, there afterwards by a representative of ap- 
 pellee, such fact does not render the instrument void, if the word 
 "seal" was sufficient to constitute the instrument a sealed instrument 
 without the necessity of a scrawl. Section 1 of chapter 29, p. 460, 
 Kurd's Rev. St. 1905, reads: "That any instrument of. writing, 
 to which the maker shall affix a scrawl by way of seal, shall be of the 
 same effect and obligation, to all intents,, as if the same were sealed." 
 While this statute has been frequently construed, the precise question 
 in the form here presented has never been passed upon by this court. 
 In Ankeny v. McMahon, 3 Scam. 12, it was held that, where an in- 
 strument describes itself in the body as sealed, and the letters "L,. 
 S." are either written or printed opposite the signature, it is a sealed 
 instrument, and that there is no substantial difference as to the validity 
 or dignity of ' the instrument whether the party executing it writes 
 his name opposite a scrawl previously written or printed, or actually 
 affixes a scrawl after signing his name. In Davis v. Burton, 3 Scam. 
 41, 36 Am, Dec. 511, it was held that where a bond or sealed instru- 
 ment purports; on. its. face,. , to, be sealed by all the signers, and there 
 are several seals attached, but not so many as there are names, the 
 court will presume that each signer has adopted some one of the 
 seals already attached. To .the same effect is Ryan v. Cooke, 172 111. 
 
462 CONTEACTS UNDEK SEAL ; (Gh. 31 
 
 302, 50 N. E. 213. See, also, Eames v. Preston, :20 111. 389. The*! 
 recital of the seal is not essential. If the instrument be actually sealed, 
 it will operate as such without the recital, and the general rule is that, 
 if there is no seal at the end, the instrument will not be held to be a 
 specialty, although -the parties in the body of the writing make mention 
 of a seal. 2 Bouvier's Law 'Die. (Rawle's : Rev.) p. 1020; 9 Am. & 
 Eng. Ency. of Law (2d Ed.) p. 147, and cases cited. ^ 
 
 Appellant contends that, our statute on this subject having been 
 adopted substantially from that of Virginia, it must be presumed we 
 adopted the construction given by the courts of that state up to the time 
 the statute was adopted; that the courts of Virginia had held that 
 an instrument such as this, even with a scrawl about the word "seal," 
 but which did not term itself in the body of the instrument as a sealed 
 instrument, was not one. Clegg v. Lemessurier, 15 Grat. (Va.) 108; 
 Parks V. Hewlett, 9 Leigh (Va.) 511. This rule might obtain if this 
 were a question of first impression and our courts had not construed 
 the statute differently from the Virginia courts. Moreover, a more 
 recent decision of the highest court of that state has held that the 
 word "seal" has the same force and effect as a scrawl, under a statute 
 very like our own. Lewis' Ex'rs v. Overby's Adm'r, 28 Grat. (Va.) 
 627. Considering the evidence in the most favorable light possible to 
 appellant, our conclusion on the Avhole record" is that this must be held 
 a sealed instrument. * * * 
 
 Judgment affirmed.' "* 
 
 PARKS V. HAZLERIGG. 
 
 (Suprpii: Court of Indiana, 1845. 7 Blackf. 536, 43 Am. Dee. 108.) 
 
 Sullivan, J. This was an action of debt on an appeal-bond. The 
 plaintiff declared against Hazlerigg, Kizer, Russell, and Ehlgan; for 
 that the defendants, on, etc., at, etc., by their certain writing obliga- 
 tory sealed with their seals, etc., acknowledged themselves to be held 
 and firmly bound, etc. On oyer it appeared that the above defendants 
 were named in the bond as obligors. There were four seals affixed to 
 the bond, but it was signed only by Hazlerigg, Russell, and Dugan. 
 Opposite to theN fourth seal there was no signature. Demurrer to the 
 declaration and judgment for the defendants. 
 
 This case presents the simple question, whether it is necessary to 
 the validity of a bond, which has been sealed by the obligor, that it be 
 signed by him also. 
 
 ' Seals not consisting of cera impressa are now generally operative. Hack- 
 er's Appeal, 121 Pa. 192, 15 Atl. 500, 1 L. R. A. 861 (1888), a mere dash after 
 the name; Van Bokkelen v. Taylor, 62 N. Y. 105 (1875), a revenue stamp 
 affixed as a seal; Pillow v. Roberts, 13 How. 472, 14/ L. Ed. 228 (1851), an 
 impression in the paper Itself, like the official and corporation seals now in 
 use ; Pierce v. Indseth, 108 U. S. 546, 1 Sup. Ct. 418, 27 X,. Ed. 254 (1882) . ' 
 
 The local custom should be looked up and followed. 
 
Ch. 3) CONTRACTS UfJDEE SEAIi 463 
 
 At common law, signing was not necessary to the validity of a deed. 
 2 Blacks. Comm. 305-306 ; Cromwell v. Grunsden, 2 Salk; 462. To 
 this point it is not necessary to multiply authorities. It has been 
 intimated that since the Statute of Frauds, and Perjqries, signing,^ as 
 well as sealing, is necessary, 2 Blacks. Comni., supra; but the better 
 opinion seems to be, that the statute has made no alteration in >this 
 respect, since it applies only to mere agreements and not to deeds. 
 1 Shepp. Touch, by Preston, 56, note 24; Hurlstone on Bonds, 8. 
 "Signing," says Gresley, in his Equity Evidence, p. 121, in speaking 
 of the execution of a deed, "is not ordinarily essential, but it is always 
 as well to prove it as a regular pa,rt of the transaction. Besides, it 
 assists the other parts of the proof of execution, for the circumstance 
 that the party has written his name opposite to the seal, on an insti-U- 
 ment bearing on its face a declaration that it was sealed by him, is 
 prima facie evidence of sealing and delivery." The common law, 
 therefore, remains, unchanged, and signing was riot essential to the 
 validity of the bond declared on in this case. If the plaintiff can prove 
 that Kizer, with the other defendants, sealed the bond, th6 proof 
 will support the declaration, which is in the usual 'form. The Court 
 erred in sustaining the demurrer.^ 
 
 The judgment is reversed, with costs. Cause remanded. 
 
 TRINITY TERM, 1537. DYER, 19a. 
 
 An obligation was thus: "for^the well and faithful payment of 
 which I bind myself by these presents, dated, etc." and not said "sealed 
 with my seal" nor "in witness whereof ;" wherefore it was asked of the 
 court if such ah obligation be good, or not. And it seemed to Sheli,Sy 
 and FiTZHERBERT that the obligation is well enough,. if a seal be put 
 to the deed, etc.* ■ 
 
 " In accord: Taunton v. Pepler, 6 Madd. 166 (1820) ; Cherry v. Heming, 4 
 Exch. 631 (1849). No doubt an instrument sealed and delivered without a 
 signature would be regarded with doubt and suspicion. 
 
 ^ It is usual and desirable for the instrument to contain a testimonium 
 clause, "In witness whereof I have hereunto set my hand and seal," but by the 
 great weight of authority it is not necessary. See Brook's New Cases, 83 
 Peters v. Field, Hetley, 75 (1630) ; Eames v. Preston, 20 111. 389 (1858) 
 Wing V. Chase, 35 Me. 260 (1853) ; Osborn v. Kistler, 35 Ohio St. 99 (1878) 
 A few states require it in certain cases. Bradley Salt Cct. v. Norfolk Im 
 porting & Exporting Co., 95 Va. 461, 28 S. E. 567 (1897) ; Blackwell v, 
 Hamilton, 47 Ala. 470 (1872) . 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, 127 Mo. 466, 
 30 S. W. 132 (1895). And cf. Weeks v. Esler, 143 N. T. 374, 38 N. E. 377 
 (1894). \ 
 
464 CONTRACTS UNDEE SEAL (Ch. 3 
 
 MICHELL V. SXOCKWITH AND ANDREWS. 
 (1588. Gouldsborough, 83.) 
 
 Thomas Michell brought debt upon an obligation against Stock- 
 with and Andrews, and the jury found a special verdict, viz. that 
 after the issue joyned, and before the nisi prius, the seal of Andrews 
 was fallen off & si, &c. 
 
 Windham. A case hath been adjudged here, that where a bond wa-s 
 delivered to the custos brevium to be kept, and the mise broke the 
 seal, and the Court adjudged that the plaintiff should be at no preju- 
 dice thereby.. And here insomuch that no fault was in the plaintiff, 
 the Court awarded that he should recover, and judgment was entered 
 accordingly. 
 
 Y. B., 1 HENRY VI, 4, pi. 14. 
 
 Note, that Cott said, that if I make and deliver a release to you 
 bearing a certain date, and you make an obligation to me bearing date 
 a week earlier, and you deliver the obligation to me after the release 
 was deliverfed to you, etc., in an action of debt upon this obligation it 
 is a good plea to say that I have given a release, and it is a good rep- 
 lication for me to say that you- have delivered the obligation to me at 
 a time since the delivery of the release. And this was so adjudged 
 before Chirn and Hull, etc.^" ■ i 
 
 CHAMBERLAIN v. STAUNTON. 
 
 (In the Common Pleas, 1588. 1 Leon. 140.) 
 
 Chamberlain brought debt upon ^n obligation against Staunton, and 
 upon non est factum, the jury found this special matter, that the de- 
 fendant subscribed and , sealed the said obligation, and east it upon a 
 certain table, and the plaintiff took it without any other delivery or 
 any other, thing amounting to a delivery. And the Court was clear of 
 opinion, that upon that matter the jury had found against the plaintiff, 
 and it is not like the case which was here lately adjudged, that the 
 obligor subscribed and sealed the obligp.tion, and cast, it upon a table, 
 saying these words, this will serve, the same was held to be a good de- 
 livery, for here is a circumstance, the speaking of these words, by 
 which the will of the obligor appeai-eth, that it shall be his deed.^^ 
 
 10 A deed is effective from the day of its delivejry, not from the day of its 
 date. Stone v. Bale, 3 Lev. 348 (1693) ; Y. B. 34 Lib. Ass. pi. 7; Goddard's 
 Case, 2 Co. Rep. 4 b (1584). 
 
 That a deed need not be dated at all, see Keilway, 34 pi. 1 (13 Hen. VII). 
 
 11 S. c. Cro. Ellz. 122, Owen, 95. 
 
 "Delivery may be effected by words without acts, or by acts without words, 
 or by both acts and words." Ruckman v. Ruckman, 32 N. J. Eq. 259, 261 (1880) ; 
 
Ch- 3) CONTRACTS UNDER SEAL 465 
 
 ANONYMOUS. 
 (1596. 2 Anderson, 41, No. XXVII.) 
 
 An instrument poll (unindented) was made in which J. S. cove- 
 nanted with R. C, and in the very same instrument R. C. covenanted 
 with J. S., and the covenants were both in express terms in the instru- 
 ment. The said R. C. first deliyered" the instrument ensealed to the 
 said J. S. as his deed, and afterwards the said J. S. delivered it as his 
 deed ensealed by him to the said R. C. The question was whether 
 this was the deed of J. S. or o'i R. C. or of both. It was adjudged 
 by THB Court that this' was the deed of both the one and the other, 
 and that he who had possession of it could maintain an action of cov- 
 enant against the other, irrespective of whether he held by the first or 
 the second delivery, for both parties are equally bound.^^ 
 
 XENOS V. WICKHAM. 
 (In the House of Lords, 1867. L. K. 2 H. L. 296.) 
 
 The plaintififs were owners of the ship Leonidas, and, the defendant' 
 is the representative of the Victoria Insurance Company. The decla- 
 ration alleged, in the usual form, that the plaintiffs caused their ves- 
 sel to be insured by this company for the space of twelve months, 
 from the 25th of April, 1861, to the 24th of April, 1862, on a policy 
 valued at £1,000, upon a ship valued at il3,000, and the loss was al- 
 leged to have occurred by perils of the sea. The defendant denied 
 the irisurahce as alleged. 
 
 It appeared on the trial that the plaintiffs employed Mr. Lascaridi, 
 an insurance broker, to secure a policy on the Leonidas for il,000. 
 
 Jordan v. Davis, 108 111. 336 (188i) ; Johnson v. Gerald, 169 Mass. 500, 48 N. E. 
 ■764 (1897) ; Thoroughgood's Case, 9 Co. Rep. 136 b (1612), words not neces- 
 sary; Shelton's Case, Cro. Eliz. 7 (1582). Mere intention is insufficient. Bush 
 V. Genther, 174 Pa. 154, 34 Atl. 520 (1896) ; Babbitt v. Bennett, 68 Minn. 
 260, 71 N. W. 22 (1897). 
 
 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. Ka- 
 maiky, 193 N. Y. 203, 86 N. E. 20 (1908), delivery of a certified copy, or 
 counterpart, of a written contract. 
 
 Delivery of Incomplete Document. — It was often held that the filling of 
 material blanks after delivery of the deed invalidated the whole. Powell v. 
 Buff, 3 Camp. 181 (1812) ; Buller, N. P. 267; Cross v. State Bank, 5 Ark. 525 
 (1844) ; State to Use of Rosett v. Boring, 15 Ohio, 507 (1846). A new de- 
 livery after fijling the blanks is effective. Hudson v. Revett, 5 Bing. 368 
 (1829). The doctrine of estoppel Is of ten. invoked to sustain such instruments 
 in the hands of innocent holders for value. Butler v. U. S., 21 Wall. 272, 22 
 L. Ed. 614 (1874) ; White v. Duggan, 140 Mass. 18, 2 N. E. 110, 54 Am. Rep. 
 437 (1885) ; Dolbeer v. Livingston, 100 Cal. 617, 35 Pac. 328 (1893). 
 
 12 Where a lease is to be executed by both parties, the delivery of the docu- 
 ihent, signed and sealed by one party, for the purpose of execution by the other, 
 does not make it an operative instrument. Diebold Safe & Lock Co. v. Morse, 
 226 Mass. 342, 115 N. E. 431 (1917). 
 
 COKBIN CONT 30 
 
466 CONTRACTS UNDER SEAL (Ch. 3' 
 
 He called at the defendant's office and they agreed upon the issuance 
 of such a policy at a definite -premium. The Company gave credit to 
 Lascaridi, charging him personally with the premium, and Lascaridi 
 collected the premium from the plaintiffs. A policy in the usual form 
 was drawn up in accordance with Lascaridi's instructions, duly signed 
 and sealed, but was held by the company's clerks until the following 
 month when Lascaridi was requested to make payment. He did not 
 pay, and the policy remained with the company. 
 
 Several months later, the Leonidas was lost, and suit was brought for 
 the insurance. The Lord Chief Justice directed a verdict for the de- 
 fendant, his decision being later affirmed by the Exchequer Chamber. 
 On appeal to the House ofXords, the Judges were summoned, the fol- 
 lowing attending: Pollock, C. B., Pigott, B., arid Blackburn, 
 WiLLBS, Mellor, and ,SjiiTh, JJ. The following qxiestion was put to 
 the Judges : 
 
 "Whether, on the facts stated in the special case, the Victoria Fire 
 & Marine Insurance Company was, when the ship Leonidas was lost, 
 liable as insurer to the plaintiffs on the policy, or alleged policy, in the 
 pleadings mentioned?" 
 
 Mr. Justice Blackburn. I answer your Lordships' question in the 
 affirmative. Two questions are involved in your Lordships' question.. 
 First, whether the policy before the 8th of June was so executed as 
 to bind the defendant's company to the plaintiffs." * * * 
 
 As to the other branch, I should wish to call your Lordships' atten- 
 tion to what I think are the real points in controversy. They are, I 
 think, tw;o ; one of fact, the other of law. 
 
 The question of fact is, I think, this : Was the policy really in fact 
 intended by both sides to be finally executed and binding from the 
 time when the directors of the defendant's company affixed their seals 
 to it, and left it in their office; or was it, in fact, intended that the 
 assured or their brokers should exercise a subsequent discretion as to 
 whether they would accept it or not. 
 
 If I thought that the parties did not in fact intend it to be then 
 finally binding, I do not think there would be any magic in the law to 
 make it binding contrary to their intention; but I submit to your 
 Lordships that the statements in the case as to what is stated to be 
 "always" the practice, and the statements there as to what was done 
 in this particular case, shew that the intention of both parties was, 
 that the policy, when drawn up by the company in conformity with 
 the instructions in the advice slip sent in by the broker, should be 
 finally binding as soon as executed by the officers of the company. It 
 was not intended by either side that anything more should be done, but 
 that the policy from that time should be binding, and should lie in the 
 
 1' Only so much of the case is here stated as deals with the question of 
 delivery. The concurring opinions of Chelmsford, L. C, Cranworth, L. J., 
 Pigott, B.; and Mellor, J., and the dissenting opinions of Willes and Smith, 
 JJ., are omitted. 
 
^^*- 3) CONTRACTS UNDER SEAL 467 
 
 Gompany's office as the property of the assured till sent for by them, 
 and then be handed over to their messenger. 
 
 It seems that some of the Judges take a different view of the fact, 
 and think it really was intended that the policy should not be finally 
 binding till something more was done by the assured. Your Lordships 
 will decide which is the true view of the facts. 
 
 Then, assuming that the intention really was that the policy should 
 be binding as soon as executed, and should be kept by the company 
 as a baillee for the assured, the question of law arises, whether the 
 policy could in law be operative until the company parted with the 
 physical possession of the deed. 
 
 I can, on this part of the case, do little more than state to your Lord- 
 ships my opinion, that no particular technical form of words or acts 
 is necessary to render an instrument the deed of the party sealing 
 it. The mere affixing the sial does not render it a deed ; but as soon 
 as there are acts or words sufficient to shew that it is intended by 
 the party to be executed as his deed presently binding on him, it 
 is sufficient. The most apt and expressive mode of indicating such 
 an intention is to hand it over, saying : "I deliver this as my deed ;" 
 but any other words or acts that sufficiently shew that it was in- 
 tended to be finally executed will do as well. And it is clear on the 
 authorities, as well as the reason of the thing, that the deed is binding 
 on the obligor before it comes into the custody of the obligee, hay, 
 before he even knows of it; though, of course, if he has not pre- 
 viously assented to the making of the deed, the obligee may refuse it. 
 In Butler and Baker's Case (3 Co. Rep. 26), it is said: "If A. make 
 an obligation to B., and deliver it to C. to the use of B., this is the 
 deed of A. presently; but if C.. offers it to B., there B. may refuse 
 it in pais, and thereby the obligation will lose its force." ^* I cannot 
 perceive how it can be said that the delivery of the policy to the clerks 
 of the defendant, to keej) till the assured sent for it, and then to hand 
 it to their messenger, was not a delivery to the defendant to the use 
 
 1* Delivery in Escroio. — Delivery cgn be made to a third person tq be held iu 
 escrow until the fulfillment of some condition, and the fact that such delivery 
 was conditional may be proved by parol evidence. See Pym v. Campbell, 6 El. 
 & Bl. 370 (1856). By the weight of authority a delivery directly to the other 
 party to the deed or contract makes the document operative at once, and parol 
 e\idence is not admitted to show that the delivery was conditional and in- 
 tended as a delivery in escrow. This rule Is disapproved by Wigmore, Evi- 
 dence, § 2404 et seq. Parol evidence that such a delivery was conditional 
 was allowed in an action on a sealed contract in Blewitt v. Boorum, 142 N. 
 ■Y. 357, 37 N. E. 119, 40 Am. St. Rep. 600 (1894). See Anson on Contracts 
 (Corbi'n's Ed. 1919) S 346, and notes; Conditions in the Law of Contract, 28 
 Tale L. Jour. 764-768 (1919). ' 
 
 After delivery in escrow, the grantor has no power of revocation. "A sub- 
 sequent change of intention, if any were shown, could not affect the delivery 
 thus completed." Moore v. Downing, 289 111. 612, 124 N. E. 557 (1919). 
 
 See, also, Braman v. Bingham, 26 N. T. 483 (1863) ; Jones v. Jones, 101 
 Me. 447, 64 Atl. 815, 115 Am. St. Rep. 328 (1903), conditional delivery of 
 promissory note. 
 
468 CONTRACTS UNDER SEAL (Ch.S 
 
 of the assured. There is neither authority nor principle for qual- 
 ifying the statement in Butler and Baker's Case, by saying that C. must 
 not be a servant of A., though, of colxrse, that is very material in 
 determining the question whether it was "delivered to C. to B.'s use," 
 which I consider it to be, in other words, whether it was shewn that it 
 was intended to be finally executed as binding the obligor at once, and 
 to be thenceforth the property of B. In the present case, the assured 
 could not have refused the deed in pais, for it was drawn up in strict 
 pursuance of the authority given by them in tlie slip set out in the case ; 
 and I think a prior authority is at least as good as a subsequent as- 
 sent. That question, however, does not arise, as they did not refuse 
 it in pais. 
 
 No authority, I think, has been cited which supports the position 
 that there is a technical necessity for some one who is agent of the as- 
 sured taking corporal possession of a policy under seal before it can 
 be binding, though intended by both parties to be so. I think it 
 would be very inconvenient, and would work great injustice, if such 
 were the law. I must leave it to your Lordships to determine whether 
 it is so or not. 
 
 The House decided in harmony with Blackburn's opinion. Judg- 
 ment reversed; and judgment given for the plaintiffs.^" 
 
 1^ Of course delivery of the policy might not be necessary to the valid 
 acceptance of the insured's application and offer for insurance. In such case 
 the undelivered policy vpould not itself be an operative fact, but there woul^ 
 be a parol agreement without it. Weber v. Prudential Ins. Co. of America, 
 284 111. 326, 120 N. E. 291 (1918) ; Cherokee Life Ins. Co. v. Brannum, 203 
 Ala. 145, 82 South. 175 (1919). 
 
 The mailing of the policy to the company's own agent operates as delivery, 
 if the agreement is perfect and no act other than physical transfer of the 
 document is to be done by the agent. Williams v. Philadelphia Life Ins Co 
 105 S. C. 305, 89 S. E. 675 (1916). But otherwise if the agent is not to de- 
 liver it until after a health investigation. Bowen v. Prudential Ins Co of 
 America, 178 Mich. 63, 144 N. W. 543, 51 L. R. A. (N. S.) 587 (1913). 
 
 Acceptance hy Qrantee. — It has often been held in America that delivery 
 is not complete until an expression of assent, by the grantee or his representa- 
 tive. Meigs V. Dexter, 172 Mass. 217, 52 N. E. 75 (1898) ; Bowen v. Pruden- 
 tial Ins. Co., of America, 178 Mich. 63, 144 N. W. 543, 51 L. E. A (N S ) 
 587 (1913) ; Derry Bank v.- Webster, 44 N. H. 264 (1862) ; Gorham's Adm''r 
 v. Meaeham's Adm'r, 63 Vt. 231, 22 Atl. 572, 13 L. E. A. 676 (1891) ; New York 
 Life Ins. Co. v. Manning, 124 N. T. Supp. 775 (1910), affirmed 156 App Div 
 818, 142 N. T. Supp. 1132 (1913) ; Anon, 2 EoUe Eep. 238 (1622). "While 
 acceptance will often be presumed where the deed is beneficial to the grantee, 
 yet where the deed imposes obligations, and vrithout remuneration. It is ab- 
 solutely essential that the grantee shall accept it." Sellers v Eike 292 tlL 
 468, 127 N. E. 24 (1020). Of. Eoberts T. Security Co., [1897] 1 Q. B.'lll. 
 
Ch. 3) CONTKACTS UNDEE SEAL 469 
 
 UNITED STATES FIDELITY & GUARANTY CO. v. 
 RIEFLER et al. 
 
 (Supreme Court of the United States, 1915. 239 U. S. 17, 36 Sup. Ct. 12, 
 
 60 L. Ed. 121.) 
 
 On a certificate from the United States Circuit Court of Appeals for 
 the Seventh Circuit presenting questions as to whether a certain in- 
 strument was a completed contract of indemnity or gua^ranty. An- 
 swered in the affirmative. 
 
 Mr. Justice Hoi,mes delivered the opinion of the court : 
 
 The facts certified are simple. One Dooling, being required to give 
 an official bond, applied in Springfield, Illinois, to an agent of the plain- 
 tiff in error, a bonding company having its home office in Baltimore, 
 Maiyland, was informed that the company would become his surety 
 only on condition that he furnish indemnity, and was handed a printed 
 form of indemnity bond. The defendants in error, at Dooling's request, 
 signed and sealed this bond for the purposes therein expressed, and 
 authorized Dooling to deliver it to the company through its Springfield 
 agent, which Dooling did. The agent, who is not shown to have had 
 authority to execute bonds, forwarded it for acceptance. The com- 
 pany, relying upon it, became surety for Dooling. One of the recitals 
 of the bond was that the company "has become or is about to become 
 surety, at the request of the said Frank E. Dooling, on a certain bond 
 in the sum of Five Thousand Two Hundred Dollars, wherein Frank 
 E. Dooling is princi'pal, as Recorder of Springfield District Court No. 
 25, Court of Honor, located at Springfield, Illinois, a copy of which 
 bond is hereto attached No. 52012-5, which bond is made a part 
 hereof." The condition was that Dooling should keep the company 
 indemnified for all loss by reason of its suretyship. A copy of the 
 company's bond was not attached and at the date of the indemnity bond 
 had not been executed. Dooling was not a party to the indemnity 
 bond. The defendants in error received no pecuniary consideration 
 for their act and were not notified of the acceptance of their bond or of 
 the execution of the other by the corfipany. The questions propounded 
 are: "(1) Was the instrument which was signed by Riefler and Hall, 
 and relied on by the' company, a completed contiract of indemnity or 
 guaranty? (2) Or was it merely an offer to become indemnitors or 
 guarantors, requiring notice of acceptance by the company, in accord- 
 ance with Davis v. Wells, F. & Co., 104 U. S. 159,26 L. Ed. 686, and 
 Davis Sewing Mach. Co. v. Richards, 115 U. S. 524, 29 L. Ed. 480, 6 
 Sup. Ct. 173? (3) And, if in substance the instrument was merely 
 an offer, does the fact that it was in the form of a bond under seal 
 take it out of the rule of those authorities ?" 
 
 If the bond in suit had been delivered directly to the company and 
 had been pronounced satisfactory there would have been no need 
 to notify Riefler and Hall of the company's subsequently executing 
 
470 CONTRACTS UNDER SEAL (Ch. 3 
 
 the Dooling bond. Riefler and Hall assumed an obligation in present 
 wordS' to indemnify the compahy against an exactly identified surety- 
 ship that the company had gone or was about to go into, as they stated. 
 The company was about to go into it and went into it. If Riefler and 
 Hall had made only a parol offer in the same terms, the company, by 
 becoming surety, would have furnished the consideration that would 
 have converted the offer into a contract; but notice is held necessary 
 in Davis Sewing Mach. Co. v. Richards. If it had been a covenant, 
 the company's act would have satisfied the condition upon which the 
 covenant applied. O'Brien v. Boland, 166 Mass. 481, 483, 44 N. E. 
 602. As it was a bond, the company's entering into its undertaking in 
 like manner furnished the subject-matter to which the obligation by 
 its terms applied. In the case of either covenant or bond there was 
 no need for notice that an event had happened that the defendants' 
 contract contemplated as sure to happen, if it had not already come to 
 pass. 
 
 The only ground for hesitation is that seemingly the bond in suit 
 might have been rejected by the company as unsatisfactory, and that 
 therefore it may be argued that Riefler and Hall were entitled to no- 
 tice that it had been accepted. But we are of opinion that, in the cir- 
 cumstances of this case, it is reasonable to understand that they took 
 the risk. They are chargeable with notice that by their act their bond 
 had come to the hands of the company. The bond on its face contem- 
 plated that the company would accept it and act upop it at once, and dis- 
 closed the precise extent of the obligation assumed. It seems to us 
 that when such a bond, carrying, as a specialty does, its complete ob- 
 ligation with the paper, is put by the obligors into the hands of the 
 obligee, and in fact is accepted by it, notice is not necessary that a con- 
 dition subsequent to the delivery, by which the obligee might have 
 made it ineifectual, has not been fulfilled. The contract is complete 
 without the notice (Butler's Case, 3 Coke, 25, 26b ; Xenos v. Wickham, 
 h. R. 2 H. L. 296; Pollock, Contr. [8th Ed.] 7, 8), and we see no 
 commercial reason why the principles ordinarily governing contracts 
 under seal should not be applied (Bird v. Washburn, 10 Pick. [Mass.] 
 223). In Davis v. Wells, F. & Co. the guaranty was an open, con- 
 tinuing one up to $10,000, but it was under seal, and was held binding, 
 although additional reasons were advanced. 
 
 We answer the first question: Yes. 
 
 Mr. Justice McKenna dissents. 
 
Ch. 3) CONTRACTS UNDER SEAL 471 
 
 BEIvIvEWE, 111. 
 
 Wadham. In debt on contract the plaintiff must show in his count 
 for what cause the defendant became his debtor. Otherwise in debt 
 on obligation, for the obligation is contract in itself." 
 
 ALLER V. ALLER. 
 
 (Court of Errors and Appeals of New Jersey, 1878. 40 N. J. Law, 446.) 
 
 The action was brought on the following instrument, viz. : "One 
 day after date, I promise to pay my daughter, Angeline H. Aller, the 
 sum of three hundred and twelve dollars and sixty-one cents, for value 
 received, with lawful interest from date, without defalcation or dis- 
 count, as witness my hand and seal this fourth day of September, one 
 thousand eight hundred and seventy-three. $312.61. This note is given 
 in lieu of one-half of the balance due the estate of Mary A. Aller, 
 deceased, for a note given for one thousand dollars to said deceased 
 by me. Peter H. Aller. [L. S.] Witnesses present, John J. Smith, 
 John F. Grandin." 
 
 Both subscribing, witnesses were examined at the trial, and it ap- 
 peared that there was a note for $1000, dated May 1st, 1858, given by 
 said Peter H. Aller to Mary Ann Aller, upon which there were en- 
 dorsements of payments — ^April 1st, 1863, $50; April 1st, 1866, $46; 
 April 1st, 1867, $278.78. 
 
 Mary Ann Aller, the wife, died, and on the day after her burial, 
 Peter H. Aller told his daughter, the plaintiff, to get the note, which 
 he said was among her mother's papers. She brought it, read the 
 note; he said there was more money endorsed on it than h^ thought; 
 requested the witness John F. Grandin to add up the endorsements 
 and subtract them from the principal, to divide the balance by two, 
 and draw a note to each of her daughters, Leonora and Angeline, for 
 one-half. After they were drawn by the witness, Peter H. Aller said: 
 "Now here, girls, is a nice present for you," and gave them the notes. 
 
 "iln this connection study McMillan v. Ames, 33 Minn. 257, 22 N. W. 612 
 (1885), ante, p. 20O. 
 
 In accord: Candor and Henderson's Appeal, 27 Pa. 119 (1856) ; Cosgrove 
 V. Cummings, 195 Pa. 497, 46 Atl. 69 (1»(>0) ; Storm v. United States, 94 U. 
 S. 76, 24 X. Ed. 42 (1876) ; Barrett v. Carden, 65 Vt. 431, 26 Atl. 530, 36 Am. 
 St. Rep. 876 (1893). 
 
 "Specialties — Those formal common-law contracts under seal — were en- 
 forced in the absence of an allegation of consideration, not because it was 
 conclusively presumed that they were founded on a consideration, but be- 
 cause consideration was not an essential element to such contracts. Contracts 
 mder seal were enforceable at common law because of the formality of their 
 jxecution, and such contracts were fully recognized and enforced long before 
 :he doctrine of consideration appeared in the law." Lacey v. Hutchinson, 5 
 3a. App. 865, 64 S. E. 105 (1909), holding, however, that the rule is not ap- 
 Jlicable to a sealed instrument of a sort unknown to early common law. 
 
472 CONTRACTS UNDER SEAL (Ch. 3 
 
 Angeline was directed to put the old note back among her mother's 
 papers. Grandin was afterwards appointed administrator of Mary A. 
 Aller, and as such, he says, he destroyed the old note. * * * 
 
 The verdict was for the plaintiff, and a rule to show cause was 
 allowed at the Circuit. 
 
 The opinion of the court was delivered by 
 
 ScuDDER, J." * * * But it. is said that the act of April 6th, 
 1875, (Revision 1877, p. 387, § 52,) opens it to the defence of want of 
 sufficient consideration, as if it were a simple contract, and, that being 
 shown, the contract becomes inoperative. 
 
 The statute reads — "that in every action upon a sealed instrument, . 
 or where a set-off is founded on a sealed instrument, the seal thereof 
 shall be only presumptive evidence of a sufficient consideration, which 
 may be rebutted, as if such instrument was not sealed," &c. 
 
 Suppose the presumption that the seal carries with it, that there 
 is a sufficient consideration, is rebutted, and overcome by evidence 
 showing there was no such consideration, the question still remains, 
 whether an instrument under seal, without sufficient consideration, 
 is not a good promise, and enforceable at law. It is manifest that 
 here the parties intended and understood that there should be no 
 consideration. The old man said : "Now here, girls, is a nice present 
 for each of you," arid so it was received by them. The mischief which 
 the above-quoted law was designed to remedy, was that where the 
 parties intended there should be a consideration, they were prevented 
 by the common law from showing none, if the contract was under seal. 
 But it would be going too far to say that the statute was intended 
 to abrogate all voluntary contracts, and to abolish all distinction 
 between specialties and simple contracts. 
 
 It will not do to hold that every conveyance of land, or of chattels, 
 is void by showing that no sufficient consideration passed when cred- 
 itors are not affected. Nor can it be shown by authority that an ex- 
 ecutory contract, entered into intentionally and deliberately, and at- 
 tested in solemn form by a seal, cannot be enforced. Both by the 
 civil and the common law, persons were guarded against haste and 
 imprudence in entering into voluntary agreements. The distinction 
 between "nudum pactum" and "pactum vestitum," by the civil law, was 
 in the formality of execution and not in the fact that in one case there 
 was a consideration, and in the other none, though the former term, 
 as adopted in the common law, has the signification of a contract 
 without consideration. The latter was enforced without reference to 
 the consideration, because of the formality of its ratification. 1 
 Parsons on Cont. (6th Ed.) *427. 
 
 The opinion of Justice Wilmot, in Pillans v. Van Mierop, 3 Burr. 
 1663, is instructive on this point. 
 
 The early case of Sharington v. Strotton, Plow. 308, gives the 
 
 1' Parts of the opinion have been omitted. 
 
Ch. 3) CONTRACTS UNDER SEAL 473 
 
 same cause for the adoption of the sealing and delivery of a deed. 
 It says, among other things, "because words are oftentimes spoken 
 by men unadvisedly and without deliberation, the law has provided 
 that a contract by words shall not bind without consideration. And 
 the reason is, because it is by words which pass from men lightly and 
 inconsiderately, but where the agreement is by deed there is more 
 time for deliberation, &c. So that there is great deliberation used 
 in the making of deeds, for which reason they are received as a lien 
 final to the party, and are adjudged to bind the party without examin- 
 ing upon what cause or consideration they were made. And there- 
 fore in the case put in 17 Ed. IV, if I by deed promise to give you i20 
 to make your sale de novo, here you shall have an action of debt upon 
 the deed, and the consideration is not examinable, for in the deed there 
 is sufficient consideration, viz., the will of the party that made tlie 
 deed." It would seem by this old law, that in case of a deed the 
 saying might be applied, stat pro ratione voluntas. 
 
 In Smith on Contracts, the learned author, after stating the strict- 
 ness of the rules of law, that there must be a consideration to support 
 a simple contract to guard persons against the consequences of their 
 own imprudence, says: "The law does not absolutely prohibit them 
 from contracting a gratuitous obligation, for they may, if they will, 
 do so by deed." 
 
 This subject of the derivation of terms and formalities from the 
 civil law, and of the rule adopted in the common law, is fully de- 
 scribed in Fonb. Eq. 335, note a. The author concludes by saying: 
 "If, however, an agreement be evidenced, by bond or other instrument, 
 under seal, it would certainly be seriously mischievous to allow 
 its consideration to be disputed, the common law not having pointed 
 out any other means by which an agreement can be more solemnly 
 authenticated. Every deed, therefore, in itself imports a consideration, 
 though it be only the will of the maker, and therefore shall never 
 be said to be nudum pactum." See, also, 1 Chitty on Cont. (11th Ed.) 
 6; Morly v. Boothby, 3 Bing. 107; Rann v. Hughes, 7 T. R. 350, 
 note a. 
 
 These statements of the law have been thus particularly given in 
 the words of others, because the significance Of writings under seal, 
 and their importance in our common-law system, seem in danger 
 of being overlooked in some of our later legislation. If a party has 
 fully and absolutely expressed his intention in a writing sealed and 
 delivered, with the most solemn sanction known to our law, what 
 should prevent its execution where there is no fraud or illegality? 
 But because deeds have been used to cover fraud and illegality in the 
 consideration, and just defences have been often shut out by the 
 conclusive character of the formality of sealing, we have enacted in 
 our state the two recent statutes above quoted. The one allows fraud 
 in the consideration of instruments under seal to be set up as defence, 
 the other takes away the conclusive evidence of a sufficient considera-. 
 
474 CONTRACTS UNDER SEAL (Ch. 3 
 
 i 
 
 tion heretofore accorded to a sealed writing, and makes it only pre- 
 sumptive evidence. This does not reach the case of a voluntary 
 agreement, where there was no consideration, and none intended by 
 the parties. The statute establishes a new rule of evidence, by which 
 the consideration of sealed instruments may be shown, but does not 
 take from them the effect of establishing a contract expressing the 
 intention of the parties, made with the most solemn authentication, 
 which is not shown to be fraudulent or illegal. It could not have been 
 in the mind of the legislature to make it impossible for parties to en- 
 ter into such promises ; and without a clear expression of the legis- 
 lative will, not only as to the admissibility, but the effect of such 
 evidence, such construction should not be given to this law. Even if it 
 should be held that a consideration is required to uphold a deed, yet it 
 might still b'e implied where its purpose is not within the mischief 
 which the statute was intended to remedy. It was certainly not the 
 intention of the legislature to abolish all distinction between simple 
 contracts and specialties, for in the last clause of the section they 
 say that all instruments executed with a scroll, or other device by way 
 of scroll, shall be deemed sealed instruments. It is evident that they 
 were to be continued with their former legal effect, except so far as 
 they might be controlled by evidence affecting their intended con- 
 sideration. * * * < 
 The rule for a new trial should be discharged.^* 
 
 PATTERSON v. CHAPMAN et al. 
 (Supreme Court of California, 1918. 179 Cal. 203, 176 Pac. 37, 2 A. L. R. 1467.) 
 
 Two actions by Etta I. Patterson against M. C. Chapman and oth- 
 ers, executors of the estate of Wm. E. Dargie, deceased. Judgments 
 in each case for the defendants, and plaintiff appeals. Judgments re- 
 versed. 
 
 Per Curiam. In these two appeals from judgments entered in favor 
 of the defendants the plaintiff attacks the rulings of the court sus- 
 taining general demurrers to the complaints without leave to amend.. 
 
 The question involved in each case is th^ same. 
 
 It appears from the complaints that William %. Dargie made, exe- 
 cuted and delivered to plaintiff an instrument in writing, a copy of 
 which as set out therein is as follows : 
 
 "Oakland, Jan. 16—08. 
 . "For value received I hereby instruct the administrator of my es- 
 tate to pay to Miss Etta Patterson, formerly of Edgewood, Cal., the 
 
 18 By a later statute (P. L. 1900, p. 366) it was further provided that in 
 actions upon sealed instruments the defendant may plead want or failure of 
 consideration, the same as if the instrument were not sealed. Se6 United 
 & Glohe Rubber Mfg. Co. v. Conard, 80 N. J. Law, 286, 78 Atl. 203, Ann. Cas. 
 1912A, 412 (1910). 
 
Ch. 3) CONTRACTS UNDER SEAL 475 
 
 sum of fifty thousand dollars, within one year from the date of my 
 death — or two years at the least. Interest at the rate of six per cent, 
 per annum is to be paid on said sum, quarterly, till said amount is 
 paid in full. Said fifty thousand dollars may be paid in real estate or 
 stocks and bonds, which I may own at the time of my death, if cash 
 cannot be paid without sacrificing my estate, but said stocks, bonds or 
 real estate, must be the full value of cash at the date of delivery. I de- 
 sire this request and order to be carried out promptly and without 
 question of any kind. W. E. Dargie." 
 
 Dargie died testate on February 10, 1911, and thereafter plaintiff 
 duly presented her claim based upon said instrument to the executors 
 of his estate, by whom it was rejected. 
 
 Some confusion of thought may arise if there is not kept constantly 
 in mind the difference between the question of the sufficiency of the 
 complaint as a pleading and the question of the sufficiency of the in- 
 strument as evidence of a valid contract or obligation for the payment 
 of money. At common law a seal was necessary in order to create the 
 presumption that an executory contract was founded upon a valuable 
 consideration, and therefore, if it was not under seal, the rule- of 
 pleading was that the complaint- or declaration must allege that the 
 contract was executed for a valuable consideration. Our Civil Code 
 declares that "a written instrument is presumptive evidence of a con- 
 sideration." Section 1614. Hence it follows that in this state, in an 
 action upon an unsealed written instrument as evidence of an obliga- 
 tion to pay money, the common-law rule applicable to sealed instru- 
 ments prevails and it is not necessary to make the additional allega- 
 tion that it was made for a valuable consideration. Henke v. Eureka 
 Endowment Ass'n, 100 Cal. 429, 34 Pac. 1089; William,s v. Hall, 79 
 Cal. 606, 21 Pac. 965. Hence the complaints are not rendered bad be- 
 cause of the failure to make such allegation. 
 
 The sole question presented for determination is whether or not the 
 writing upon which plaintiff relies is in form and character testamen- 
 tary as held by the trial court, or as claimed by appellant it is a con- 
 tract by virtue of the execution and delivery of which Dargie in his 
 lifetime created an obligation to be dischai'ged after his death by his 
 executors. 
 
 If the instrument created a debitum in praesenti, an obligation ex- 
 isting in the lifetime of the obligor, the fact that it was not to be dis- 
 charged until after Dargie's death renders it none the less enforceable 
 as a demand against his estate. 8 Cyc. 1007. "Where a testator has 
 not, in a paper payable post mortem, recognized himself either by in- 
 tendment, or language, as under legal indebtedness to the party in 
 whose favor it is made, such instrument is without consideration, 
 purely voluntary, and testamentary in its character." Kirkpatrick v. 
 Pyle, 6 Houst. (Del.) 569. Any memorandum in writing, however, re- 
 gardless of its form, and whether payable in money or specific prop- 
 erty, whereby a debt is acknowledged by one as owing to another to 
 
476 CONTRACTS UNDER SEAL (Ch. 3 
 
 whom the memorandum is delivered is sufficient to create such obli- 
 gation. "Any words which prove a man to be a debtor will, charge 
 him with the payment of the money." Cover v. Stem, 67 Md. 449, 10 
 Atl. 231, 1 Am. St. Rep. 406. Hence, conceding the document in ques- 
 tion is not a negotiable instrument, draft, check, or bill of exchange, 
 as claimed by respondent, the want of such character is immaterial if 
 terms are employed therein which at the time of its execution created 
 a debitum in prsesenti. Banker v. Coons, 40 App. Div. 572, 58 N. Y. 
 Supp. 47; Robbins v. Robbins' Estate, 175 Mo. App. 609, 158 S. W. 
 400; Kirkpatrick v. Pyle, supra. 
 
 It is true the instrument contains no express promise to pay, but 
 where the existence of an indebtedness based upon consideration is 
 acknowledged the law implies a promise to pay it (Ward v. Bush, 59 
 N. J. Eq. 144, 45 Atl. 534), and the fact that payment is postponed 
 until after the death of the party so acknowledging it is immaterial 
 (Robbins v. Robbins' Estate, supra; Hegeman v. Moon, 131 N. Y. 
 462, 30 N. E. 487). 
 
 The instrument being signed by Dargie, every statement therein 
 must be considered as his declaration and. given effect accordingly. In 
 the absence of any defense on the ground of fraud, mistake, or want 
 of consideration, each declaration therein made, or necessarily im- 
 plied from its language, must be given the full effect that the meaning 
 carries. The instrument, therefore, contains a declaration by Dargie 
 that in his lifetime, and before or at the time of its execution, he had 
 received from the plaintiff something of value, a value which he con- 
 sidered equal to $50,000, and that for that consideration liis executors 
 are ordered and directed to pay to the plaintiff that sum in the man- 
 ner and at the time specified. This precludes the idea of a gift to 
 her. Its meaning is that he is ordering the payment to be made to her 
 as a return for the value which he had received from her. This makes 
 it a payment or recompense, not a gift. Furthermore, as it was an ad- 
 mission by him that in his lifetime he had received from her that val- 
 ue, not as a gift or as payment of any obligation to him, this fact 
 alone, without any order to his executors to pay, would, in law, raise 
 an implied promise by him to pay her for the benefit so received, and 
 would be a sufficient foundation for a claim against the estate for 
 such value. Cover v. Stem> supra. The only effect of the order, it 
 having been accepted by her, is to merge the implied contract, and to 
 modify it, so that she is thereby obliged to accept payment at the time 
 and in the manner therein provided. 
 
 An examination of the authorities cited by respondent, chief among 
 which is that of Cover v. Stem, supra, discloses that tlie instruments 
 under consideration and constituting the subjects of the actions con- 
 tained no promise and no words which by intendment or otherwise 
 could be construed as acknowledging an indebtedness. Thus, in Cov- 
 er v. Stem, supra, Moore v. Stephens, 97 Ind. 271, Pena v. New Or- 
 leans, 13 La. Ann. 86, 71 Am. Dec. 506, and other like cases, it was 
 
Ch. 3) CONTRACTS UNDER SEAL 477 
 
 held that in the absence of a promise, and without recital or acknowl- 
 edgment of consideration, an instrument containing a mere direction 
 to the executors to pay the sum mentioned was testamentary in char- 
 acter. And to like effect are the cases in this state, namely, Wisler- 
 V. Tomb, 169 Cal. 382, 146 Pac. 876, and Tracy y. Alvord, 118 Cal. 
 655, 50 Pac. 757, both of which involved notes shown to have been 
 given without consideration, and in the first of which such fact ap- 
 peared from the complaint. On the other hand, in the cases of Bank- 
 er V. Coons, supra, Robbins v. Robbins' Estate, supra, Kirkpatrick v. 
 Pyle, supra. Hatch v. Gillette, 8 App. Div. 605, 40 N. Y. Supp. 1016, 
 and Ward v. Bush, supra, where the instruments were executed under 
 seal, 'but in addition to the fact presumed therefrom, as in the case at 
 bar, contained the words, "For value received," or those of like im- 
 port, it was held they created a debitum in prsesenti, which obligation 
 being established, the law implied a promise to pay it. 
 
 The judgments are reversed.^" 
 
 I dissent: Wilbur, J. 
 
 i» See, also, Krell v. Codman, 154 Mass. 454, 28 N. E. 5T8, 14 L. E. A. 860, 
 26 Am. St. Rep. 260 (1891). 
 
 Statutory Changes. — (1) Some states, while preserving the distinction be- 
 tween 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 1896, § 3288 ; Mich. Comp. 
 Laws 1895, §§ 10185-10186; N. J. Gen. St. 1895, p. 1413, § 72; N. Y. Code Civ. 
 Proc. § 840 ("upon an executory instrument") ; Or. B. & C. Comp. 1902, § 765 ; 
 Wis. St. 1898, § 4195. 
 
 (2) Many states abolish all distinction between written sealed and unsealed 
 instruments, and most of these provide that any written contract shall have 
 a rebuttable presumption of consideration. Cal. Civ. Code, § 1629 ; Idaho 
 Civ. Code 1901, § 2730 ; Iowa Code, § 3068 ; Ind. Burns' Ann. St. 1901, § 454 ; 
 Kan. Gen. St. 1897, c. 114, «§ 6, 8; Ky. St. §§ 471-472; Minn. Eev. Laws 
 1905, § 2652; Miss. Code 1892, §S 4079-^082; Mo. Rev. St. 1906, §§ 893, 
 894; Mont. Civ. Code 1895, §§2190, 2169; Neb. Comp. St. 1909, c. 81, § 1 ; 
 N. D. Rev. Code 1905, § 5338 ; Ohio Rev. St. 1890, § 4 ; S. D. Ann. St. 1901, 
 § 4738; Tenn. Milliken & V. Code, §§ 2478-2480; Tex. Rev. St. arts. 4862, 4863 ; 
 Utah Eev. St. 1898, §§ 1976, 3399 ; Wyo. Rev. St. 1899, § 2749. See construing 
 such statutes, Bender v. Been, 78 Iowa, 283, 43 N. W. 216, 5 L. R. A. 596 
 (1889), written release of -debt upon part payment not binding; Winter v. 
 Kansas City Cable Ry. Co., 160 Mo. 1§9, 61 S. W. 606 (1900), same, release 
 under seal; Hale v. Dressen, 73 Minn. 277, 76 N. W. 31 (1898), same; J. B. 
 Streeter, Jr., Co. v. Janu,' 90 Minn. 393, 96 N. W. 1128 (1903), undisclosed 
 principal liable on sealed contract; Ames v. Holderbaum (C. C.) 44 Fed. 224 
 (1890), same; Bradley v. Rogers, 33 Kan. 120, 5 Pac. 374 (1885), private 
 seals abolished ; Garrett v. Belmont Land Co., 94 Tenn. 459, 29 S. W. 726 
 (1894), same; Murray y, Beal, 23 Utah, 548, 65 Pac. 726 (1901), same. 
 
^78 OPHKATION OF CONTRACT (Ch. 4 
 
 CHAPTER IV 
 
 OPERATION OF CONTRACT AND OF FACTS SUB- 
 SEQUENT TO ACCEPTANCE ^ 
 
 (And Herein of the Interpretation and Construction of Contracts, and 
 the Effect of Breach) 
 
 INTRODUCTORY NOTE 
 
 1. What is a condition? A condition is an operative fact, the occur- 
 rence of which will create some new legal relation (or extinguish an 
 existing legal relation). It is generally not a promise, although the 
 performance of an act promised is often a condition. A not uncom- 
 mon use of the word is to denote almost any term or provision in a 
 contract (i. e., a group of words). This use should be avoided. A 
 group of words may determine that some fact shall operate as a 
 condition, but the group of words are not themselves the coiidition. 
 
 2. When will a fact operate as a condition? It will so operate 
 when the parties to a contract agree that it shall and express this 
 agreement either by words or by conduct froni which it may rea- 
 sonably be inferred (or implied). It will likewise so operate when 
 the court believes that justice requires it, even though the parties nei- 
 ther had nor expressed any intention regarding it.^ Conditions ma,y 
 therefore be classified as express, implied, and constructive. 
 
 3. What are conditions precedent and subsequent? A condition 
 may be regarded with reference to the legal relations that it extin- 
 guishes or those that it helps to create. As to the former, it is sub- 
 sequent ; as to the latter, it is precedent.^ The particular legal relation 
 
 1 See Anson on Contract (Oorbin's Ed.) chapter. XIII. 
 
 2 "You can always imply a condition in a contract. But why do you imply it? 
 It is because of some belief as to the practice of the community or of a class, 
 or because of some opinion as to policy, or, in short, because of some attitude 
 of yours upon a matter not, capable of exact quantitative measurement, and 
 therefore not capable of founding exact logical conclusions." Justice O. W. 
 Holmes, "The Path of the Law, 10 Harv. L. Rev. 466. See, also, Leonard v. 
 Dyer, 26 Conn. 172, 178, 68 Am. Dec. 382 (1857) ; Bankes, L. J., in Grove v. 
 Webb, 114 L. T. 1082, 1089 (1916). 
 
 3 In the sense as herein defined, a condition is never "concurrent." It pre- 
 cedes the legal relation that it creates, and it is subsequent to the relation 
 that it extinguishes. But two mutual promises may require concurrent per- 
 formances. In such cases a tender of performance by either one may be a 
 condition precedent to an instant and enforceable duty in the other. 
 
Ch. 4) CONDITIONS PRECEDENT 479 
 
 with respect to which a condition is to be judged. varies with the case, 
 but it is usually the legal duty of instant performance for breach of 
 which an action lies.- When the creation of a particular legal duty 
 requires the existence of four facts, all four are conditions precedent ; 
 if three of them already exist, the fourth is a condition precedent. 
 The term "conditional duty" is commonly used to indicate that 
 three (or some) of the necessary facts exist or have occurred and 
 that the enforceable duty awaits only the occurrence of the fourth 
 (or others). 
 
 4. Are offer, acceptance, consideration, delivery, legality of ob- 
 ject, and the like, conditions? They might be so called, because in 
 their absence no new contractual relations will exist; but it is not 
 customary to describe them as conditions, and it is convenient to re- 
 strict the term condition to apply to an operative fact subsequent to 
 acceptance and prior to discharge. The legal relations created by 
 acceptance are called "contract" or primary obligation (primary re- 
 lations). The question of conditions usually involves an inquiry as 
 to breach of contract and the existence of new legal relations called 
 secondary obligations. 
 
 5. What is a dependent promise? It is one that creates no instant 
 duty, but instead a duty conditional upon the performance (or tender 
 thereof) by the promisee of a return promise made by him. An inde- 
 pendent ptromise is one that is not thus conditional. 
 
 6. What sorts of facts customarily operate as conditions? They 
 are many, and the question must be answered by a study of the cases. 
 They may be classified according to a number of different principles, 
 each having a certain usefulness and convenience. 
 
 I. Express ; implied ; constructive. (See 2, supra.) 
 II. Precedent; subsequent. (See 3, supra.) 
 
 III. (a) Acts or events not in themselves the consideration for the 
 
 promise sued on. These are usually express; e. g., archi- 
 tect's certificate, 
 (b) Facts constituting the expected equivalent, being generally acts 
 of the promisee (he som.etimes having promised to perform 
 them and sometimes not). These are more often not ex- 
 press. 
 
 IV. (a). Acts or events that are certain to occur at a definite time; e. g., 
 
 the arrival of a future date. 
 
 (b) Those certain to occur, but at an uncertain time; e. g., the 
 
 death of X. 
 
 (c) Those not certain to occur at all ; e. g., the arrival of a ship, or 
 
 the construction of a building. f 
 V. (a) Conditions not within the volitional control of any person; 
 e. g., a fair wind, as in Constable v. Clobery. 
 (b) Those within the volitional control of a third person; e. g., 
 architect's certificate, or the king's return to London. 
 
480 Operation OF CONTEACT I (Ch. 4 
 
 (c) ThtDse within the volitional control of the promisor. See 
 
 Scott V. Moragues Lumber Co. (1918) 202 Ala. 312, 80 
 South. 394, infra, 492. 
 
 (d) Those within the volitional control of the promisee; e. g., 
 
 ordinary option contracts. 
 VI. By the Louisiana Code, conditions precedent and subsequent are 
 called suspensive and resolutory, each of these being again 
 subdivided into casual and potestative. See discussion 
 and application of these code provisions in New Orleans v. 
 Texas & Pac. R. Co. (1897) 171 U. S. 312, 332, 18 Sup. Ct. 
 875, 43 L. Ed. 178. 
 No doubt still other classifications are useful, and no classification 
 is indispensable. The cases present facts in many combinations and 
 they are not easily classified. In some degree, the cases herein are 
 arranged according to I and II, supra; but the chief purpose under- 
 lying thp arrangement was to make the cases most readily teachable. 
 
 SECTION 1.— EXPRESS CONDITIONS PRECEDENT* 
 
 (Conditions Distinguished from Promises and Covenants, and Express 
 Conditions Illustrated) 
 
 CONSTABLE v. CLOBERY. 
 
 (In the King's Bench, 1626. Latch, 49.) 
 
 Action of covenant. The plaintiff alleged that he had hired his 
 ship to the defendant and that by charter party indented he had 
 covenanted with the defendant and- one A. that the ship should sail 
 with the next wind on a voyage to Cadiz. The defendant and A. 
 jointly and severally covenanted with the plaintiff that if the ship 
 went the intended voyage and returned to the Downs the plaintiff 
 should receive a certain sum as freight, but if it should go on to 
 Amsterdam they would pay to the plaintiff so much more. The 
 plaintiff further alleged that the ship went to Cadiz and returned 
 to the Downs, and that the defendant had not paid the sum agreed 
 upon for freight, primage, etc. The defendant pleaded a special plea 
 and denied particularly that the ship had sailed with the next wind. 
 
 * Several cases are here printed merely as illustrations of different sorts ot 
 Express Conditions. There is no distinct boundary line between express and 
 implied conditions, since the intention of men is expressed in various ways, 
 with varying degrees of clearness and accuracy: In general, the effort of 
 the courts is to interpret the words and other conduct of the parties, so as to 
 arrive at their intention; so that, in dealing with Implied Conditions later, 
 we shall constantly deal also with "express" conditions as well. 
 
Seel) KXPBESS CONDITIONS PRECEDENT 481 
 
 The plaintiff demurred to this plea, raising the question whether it 
 set up a good def einse. Stone argued that it did not, because the sub- 
 stance of the covenant is that the ship should sail and not that it 
 should sail with the next wind, inasmuch as the wind may change and 
 vary with the passing hour. And he said that this was proved by 
 the covenant itself, which is to give so much as freight, that is to 
 say, for going the voyage, and not for sailing with the next wind 
 (citing Ughtred's Case, 7 Co. Rep. 9). The Court held that the 
 plea was bad. But Jones, J., said that if the defendant had covenant- 
 ed that if the ship should sail for Cadiz with the next wind he would 
 pay the agreed sum, then the plaintiff ought to allege that he had sailed 
 with the next wind. DodEridge, J., gave as his reason that the wind 
 is uncertain, and therefore is not the substance of the covenant." 
 
 ANDERSON et al. v. ODD FELLOWS' HALL OF JERSEY CITY. 
 
 (Court of Errors and Appeals of New Jersey, 1914. 86 N. J. Law, 271, 90 
 
 AH. 10,17.) 
 
 Action by John B. Anderson and others against the Odd Fellows' 
 Hall of Jersey City. Judgment for defendant, and plaintiffs appeal. 
 Reversed. 
 
 Bergen, J.' This action was instituted to recover the value of ex- 
 tra work and material furnished by the plaintiffs, in excess of what 
 a contract between the plaintiffs and defendant for the construction 
 of a building required. The plaintiffs had judgment in the district 
 court for $297, and the defendant appealed to the Supreme Court, 
 where the judgment below was reversed, and a judgment of nonsuit 
 ordered entered in the district court for two reasons, the first being 
 that a covenant contained in the contract, requiring arbitration in 
 certain matters, was a condition precedent, and that without its per- 
 formance^the plaintiffs could not recover. 
 
 At the close of the testimony the defendant admitted that as to 
 $227 of plaintiffs' claim written orders required by the contract had 
 been produced, and to that extent the claim was not disputed on that 
 ground, but insisted that, as some of the items were disputed, arbitra- 
 tion as to all was a condition precedent, and this the Supreme Court 
 sustained. To affirm this judgment will sustain a nonsuit where a part 
 of the plaintiffs' claim is not in any wise subject to the arbitration 
 agreement, even if it should be a condition precedent, because not 
 
 5 Not all of the report is here translated. The case is also reported in 
 Palmer, 397, and Popham, 161. 
 
 See, also, Shadforth v. Higgin, 3 Camp. 385 (1813), and Ollive v. Booker, 1 
 Ex. 416 (1847), post, pp. 692, ,693. 
 
 ° A condition precedent is an operative fact that must precede the existence 
 of an enforceable right. Part of the opinion not dealing with the distinction! be- 
 tween a condition and a covenant is omitted. 
 
 COBBIN CONT 31 
 
482 OrBRATION OF CONTRACT (Gh. 4 
 
 disputed. But, in our opinion, the covenant for arbitration contained 
 in this contract is not a condition precedent to an action for the re- 
 covery of the extra worls sued for. 
 
 The contract on this subject provides that: "No alteration shall 
 be made in the work except upon written order of the committee; 
 the amount to be paid by the owner, or allowed by the contractors by 
 virtue of such alterations, to be stated in said order. Should the own- 
 er and the contractors not agree as to amount to be paid or allowed, 
 the work shall go on under the order required above, and in case of 
 failure to agree the determination of said amount shall be referred 
 to arbitration as provided for in article XII of this contract." 
 
 Article XII provides that : "In case the owner and contractors fail 
 to agree in relation to matters of payment, allowance, or loss, referred 
 to in articles III or VII of this contract, or should either of them 
 dissent from the decision of the committee referred to in article VII, 
 * * * the matter shall be referred to a board of arbitration, to con- 
 sist of one person selected by the owner and one person selected by 
 the contractors, these two to select a third. The decision of any two 
 of this board shall be final and binding on both parties hereto." 
 
 The condition to arbitrate, as expressed in this contract, is not, by 
 its terms, made a condition precedent to an action to recover for extra 
 work.'' It is nothing more than an agreement to arbitrate disputes 
 regarding the amount to be allowed for extra work ordered and per- 
 formed, in cases where the parties cannot agree, revocable at any time 
 before it is fully executed and an award made, and the bringing of a 
 suit amounts to a revocation. Reed v. Washington Ins. Co., 138 
 Mass. 572. 
 
 In the case of Wolff v. Ins. Co., 50 N. J. Law, 453, 14 Atl. 561, 
 the agreement contained a stipulation that no action should be main- 
 tained until after an award be obtained fixing the amount of the 
 claim, as provided by the agreement to arbitrate. This was held to 
 be a condition precedent, but Chief Justice Beasley, who delivered the 
 opinion of the court, distinguished such condition from a case where 
 the agreement merely declares that, if the parties shall disagree as to 
 the amount, such difference shall be arbitrated, which is the situation in 
 the present case, for there is here no contract that the amount shall 
 not be recoverable by suit until after arbitration, or the recovery limit- 
 ed to a sum to be fixed by arbitrators, or that arbitration shall be a 
 condition precedent to a right of action, and therefore the arbitra- 
 tion covenant in this contract is not a condition precedent. Birming- 
 ham Fire Ins. Co. v. Pulver, 126 111. 329, 18 N. E. 804, 9 Am. St. Rep. 
 598. This question was considered in Hamilton v. Home Ins. Co., 
 137 U. S. 370, 11 Sup. Ct. 133, 34 ,L. Ed. 708, where the condition was 
 similar to that in this case, there being "no provision whatever post- 
 
 ^ This sentence shonVl read: The express 4erms used by the parties do not 
 make the award of arbitrators a condition precedent to the right to payment. 
 
ScC.l) EXPRESS CONDITIONS PRECEDENT 483 
 
 poning .the right to sue until after an award," and it was there held 
 that the agreement to arbitrate was not a condition precedent, and the 
 court distinguished that case from Hamilton v. Liverpool & L, & 
 G. Ins. Co., 136 U. S. 242, 10 Sup. Ct. 945, 34 L. Ed. 419, where the 
 condition was that no suit should be sustained until after an award, 
 in which case the obtaining of an award was held to be a condition 
 precedent. To the same effect is Mutual Ins. Co. v. Alvord, 61 Fed. 
 752, 9 C. C. A. 623. 
 
 The weight of authority favors the rule that, where the contract 
 provides for submission to arbitration of rnatters of dispute arising 
 under it, such agreement is a condition precedent, where it is pro- 
 vided that an action can, only be brought for a sum to be fixed by 
 arbitrators, or that no action shall be brought until there has been an 
 arbitration, or that arbitration shall be a condition precedent to a right 
 of action, but, where no such covenants are. present, and there is sim- 
 ply a covenant to pay, and another covenant to arbitrate, they are dis- 
 tinct and collateral, and the covenant to arbitrate [the arbitration and 
 award] is not in such case a condition precedent. The covenant to 
 arbitrate in the present case being distinct and collateral, and the 
 right of action not having been made dependent upon the result of 
 arbitration, it is not a condition precedent, and the judgment of the 
 Supreme Court based upon this ground cannot be sustained. * * * 
 
 Reversed, and new trial granted.* 
 
 ' Cases holding that a term of the contract creates a condition, but Is 
 not a promise, and creates no duty, are Home Ins. Co. v. Union Trust Co., 40 
 R. I. 367, 100 Atl. 1010, L. R. A. 1917F. 375 (1917) ; Coykendall v. Blackmer, 
 161 App. Div. 11, 146 N. Y. Supp. 631 (1914). 
 
 For cases holding that the particular proviso is promissory, and creates a 
 duty, and not a mere condition, see St. Paul Fire & Marine Ins. Co. v. 
 Upton, 2 N. 1). 229, 50 N. W. 702 (1891) ; Boston Safe-Deposit & Trust Co. 
 T. Thomas, 59 Kan. 470, 53 Pac. 472 (1898). Some cases indicate, a great 
 readiness to find a promise by mere inference or implication. Dupont De 
 Nemours Powder Co. v. Schlottman, 218 Fed. 353, 134 C. O. A. 161 (1914.) ; 
 Patterson v. Meyerhofer, 204 N. Y. 96, 97 N. E. 472 (1912). Cf. Clark v. 
 Hovey, 217 Mass. 485, 105 N. E. 222 (1914). 
 
 In Green County, Ky., v. Quinlan, 211 U. S. 582, 29 Sup. Ct. 162, 53 L. 
 Ed. 335 (1908), a county issued bonds to assist in construction of a railroad, 
 "upon condition" that, the railroad be constructed through Green county. It 
 was held that "that which is called a condition is really but a covenant or 
 agreement, to be performed independently of the counter obligation with 
 which it is associated." This holding was largely due to the fact that the 
 money was to be used In the construction and not afterwards. 
 
 A representation of fact made in the formal document may be such that 
 its truth is a condition. If the statement is "warranted" to be true, it will 
 often be held to be a promise, and its truth to be a condition. See Yorkshire 
 Ins. Co. V. Campbell, [1917] A. C. 218; Harrison v. Knowles, [19181 1 K. B. 
 608. Cf. Globe Mut. Life Ins. Ass'n v. Wagner, 188 111. 133, 58 N. E. 970, 52 
 L. R. A. 649, 80 Am. St. Rep. 169 (1900) ; Rathman v. New Amsterdam Cas- 
 ualty Co., 186 Mich. 115, 152 N. W. 983, L. R. A. 1915E, 980, Ann. Cas. 1917C, 
 459 (1915). See Ollive v. Booker, post, 693. 
 
4S4 OPERATION OF CONTKACT (Ch. 4 
 
 HAMMOND V. NIAGARA FIRE INS. CO. 
 
 (Supreme Court of Kansas, 1914. 92 Kan. 851, 142 Pac. 936, I/. R. A. 1915F, 
 
 759.) 
 
 Action by W. A. Hammond against the Niagara Fire Insurance Com- 
 pany. From judgment for defendant, plaintiff appeals. Affirmed. 
 
 Johnston, C. J.® The question involved in this proceeding is: 
 Does the failure to keep and produce certain records of a commercial 
 business, as required by the terms of a fire insurance policy, bar re- 
 covery in case of loss ? W. A. Hammond, the appellant, brought this 
 action to recover against the Niagara Fire Insurance Company, the 
 appellee, on a policy of insurance issued by that company upon a 
 stock of merchandise and store fixtures owned by him and located 
 at Towanda, Kan. On July 17, 1911, the appellee, by its agent, G. 
 W. Moore, issued to appellant the policy of insurance upon his stock 
 of merchandise to the amount of $3,300, and upon the fixtures to the 
 amount of $200, and a few days thereafter the appellant paid there- 
 for the premium of $45.50. The policy was standard in form, and in 
 it was a provision which required, among other things, that the insured 
 would keep a set of books, which would present a record of the 
 business transacted and keep the books and inventories in a fireproof 
 safe at night, or at some place not exposed to fire, and to produce 
 them in case of loss, and it also provided that a failure to keep and 
 produce the books and inventories would avoid the policy. About 
 3 o'clock in the morning of May 9, 1912, a fire occurred, and the 
 books of account, which, it appears, appellant had been keeping upon 
 the top of a trunk in his sleeping room over the storeroom, and the 
 last inventory, which he kept in the trunk, Were destroyed. Appellee's 
 agent was notified of the fire, atid an adjuster came and interviewed 
 appellant, but he refused to recommend payment of the loss on 
 account of appellant's inability to produce the books of account and the 
 last inventory. He, however, suggested that appellant make proofs 
 of loss to the appellee, and also inform it as to the books and inventory. 
 This appellant did about May 17, 1912. 
 
 The loss was not paid, and on July 25, 1912, appellant brought this 
 action asking for a reformation of the policy of insurance striking out 
 that portion requiring the books and inventory to be kept in a fireproof 
 safe, and also for judgment for the amount of the policy. In the 
 proofs of loss made by appellant the value of the merchandise and 
 fixtures was placed at $4,800, and on the trial evidence was introduced 
 tending to show that the last inventory, taken in January, 1912, showed 
 the value of the stock to be about $4,200, and the fixtures about $300. 
 Evidence was also introduced tending to show that appellant did 'not 
 know that the fireproof safe clause was in the policy. A demurrer of 
 appellee to appellant's evidence, on the ground that it failed to show 
 
 " Part of the opinion Is omitted. 
 
Seel) _ EXPRESS CONDITIONS PKEOEDENT 485 
 
 a cause of action, was overruled, but after the introduction of addi- 
 tional testimony by appellant to the effect that the safe clause in the 
 policy was put in by the agent without mentioning the fact to appel- 
 lant the court modified its ruling and sustained the demurrer as to the 
 merchandise, but overruled it as to the fixtures. The court directed 
 the jury to return a verdict in favor of appellant for $224, for the loss 
 of the fixtures, and, overruling appellant's motion for a new trial, 
 judgment was accordingly rendered. He appeals, and here insists that 
 the ruling of the trial court on the demurrer to tlie evidence as to the 
 keeping and production of the books and inventory is error. 
 
 The contention is that, under the terms of the policy, the failure to 
 produce the books and inventories does not, of itself, avoid the policy 
 nor forfeit the right to recover the insurance. It is insisted that con- 
 tracts of insurance are to be construed most strongly against the in- 
 surer, and most favorably to the insured; that forfeitures are not 
 to be enforced unless definitely provided for in the contract ; and that, 
 as only one of two contingencies upon which a forfeiture depends 
 in this contract has transpired, the policy cannot be forfeited. Under 
 the conditions of the policy, appellant was to keep and produce books 
 and inventories, and he contends that he observed the requirement to 
 keep these, and only failed as to their production. Among the condi- 
 tions of flie contract the insured was required to take an itemized in- 
 ' ventory of the stock at certain times during the fife of thg, policy. The 
 second condition was: "The assured will keep a set of books, which 
 shall, clearly and plainly present a complete record of the business 
 transacted, including all purchases, sales, and shipments of said stock, 
 both for cash and credit, from the date of the inventory or invento- 
 ries provided for in the first section of this clause, and during the con- 
 tinuance of this policy." 
 
 In the third condition it was provided that : ''The assured will keep 
 such. books and last inventory, and also the last preceding inventory, 
 securely locked in a fireproof safe at night, and at all times when the 
 building mentioned in this policy, or the portion thereof containing the 
 stock described therein, is not actually open for business; or, failing 
 in this, the assured will keep such books and inventories at night, and 
 at all such times in some place not exposed to a fire which would ignite 
 or destroy the aforesaid building ; and in case of loss, the assured spe- 
 cifically warrants, agrees, and covenants to produce such books and in- 
 ventories for the inspection of said company. In the event of failure 
 on the part of assured to keep and produce such books and inventories 
 for the inspection of said company, this entire policy shall become null 
 and void,, and such failure shall constitute a perpetual bar to any 
 recovery, thereon." it 
 
 Appellant did keep a set of books, which, he says, was a complete 
 record of all his business, and he did take an inventory as required 
 by the terms of the policy, and he insists that he only failed as to the 
 
486 OPERATION OF CONTRACT (Ch. 4 
 
 production of these. He argues that the policy is to be void only for 
 the failure to do both, and that no penalty attaches for the failure to 
 perform one of the conditions. What is meant by the expression "to 
 keep and produce?" The word "keep" is a general term which is va- 
 riously applied, and is often used in more than one sense in the same 
 instrument or writing. It may mean to make or enter or to retain 
 and preserve. It is plain that the meaning of the words "keep a set 
 of books," as used in the second condition of the warranty, is that the 
 insured shall make and enter in books a record of the business trans- 
 acted by him. As there used, the words have no reference to the pres- 
 ervation and safety of the books when they are made. 
 
 In the third paragraph of the warranty the word has a definite sig- 
 nification. There it means to hold, care for, or preserve, which is the 
 primary meaning of the word. It implies that the books when made 
 and the inventories when taken shall be preserved as against destruc- 
 tion or loss, and to that end it is provided that they shall be placed 
 or kept securely locked in a fireproof safe at night and when the store 
 is not open for business, or, in the event that' this is not done, that 
 they shall be kept in a place not exposed to fire which would ignite 
 or destroy the store building. The coupling of inventories with books 
 in the third paragraph tends to strengthen the view that the word 
 "keep" implies preservation, because the keeping of an.inventory does 
 not convey the idea of taking or making otie, but rather the preserving 
 of it from destruction. The keeping provided for in the third para- 
 graph requires that the books and inventories shall be cared for and 
 preserved so that they can be produced and, in case of loss, furnish 
 some evidence as to the extent of the loss sustained by the insured and 
 of the liability of the insurer. 
 
 Some comment is made on the action of the agent in inclilding this 
 clause in the policy , without the knowledge of the insured. It is 
 not contended that there was any fraud or deception practiced by the 
 agent. The clause is one common in policies insuring merchandise, 
 and it is conceded that it serves a useful purpose. In speaking of this 
 clause it was said in Insurance Co. v. Knerr, 72 Kan. 385, 387, 83 Pac. 
 611,612: 
 
 "It is not an unreasonable precaution ; it is one with which the in- 
 sured might very easily have complied. In any event, the parties mak- 
 ing the contract agreed that it should be performed by the insured, 
 and, since it is a part of the contract, it cannot be ignored or arbitra- 
 rily set aside. It is generally held that neglect on the part of the in- 
 sured substantially to comply with a clause in an insurance policy to 
 keep the books used in conducting the insured's business in an iron 
 safe, or in some place where they will not be destroyed in case the 
 place in which the insured stock is kept is consumed by fire, will avoid 
 the policy." * * * 
 
 ' We think the trial court correctly interpreted the contract of insur- 
 ance, and that the insured failed to keep and produce the books as 
 
Sec. 1) EXPRESS CONDITIONS PEECEDENT 487 
 
 he had agreed to do, and/further, that compliance with this requirement 
 was essential to a recovery under the policy. 
 
 We find nothing in the testimony that would have warranted the 
 court in reforming the contract by striking out the clause in question. 
 
 The judgment of the district court will be affirmed. All the Jus- 
 tices concurring.^'* 
 
 SELMAN V. KING et al. 
 (In the King's Bench, 1607. Cro. Jae. 183.) 
 
 Assumpsit. Whereas upon a suit in the Star-Chamber between the 
 defendant and others, a commission issued for the examination of wit- 
 nesses ; that the plaintiff at the time of the commission kept an inn 
 in Beningham ; and in consideration that she promised to find horse- 
 meat and man's-meat for tlie defendant and his company during 
 the time of the sitting of the commission, that the defendant as- 
 sumed to pay to the plaintiff all such sums as that diet and horse- 
 meat amounted to, when he should be thereunto requested: and 
 alledgeth in fact, that the commissioners sat there three days, and 
 that she found the said horse-meat and man's-meat during the ^ said 
 time, which amounted to fiye pounds six shillings; and that the de- 
 fendant, licet saepius requisitus, hath not paid it. 
 
 The defendant pleads non assumpsit; and it was found against 
 him: and now moved in arrest of judgment, that the promise being 
 to pay when he should be requested, there ought to be a precise re- 
 quest alleged, and the year, day, and place of the request expressed; 
 for the defendant is not otherwise chargeable in an assumpsit. 
 
 The whole Court was of that opinion; for when the defendant, is 
 chargeable upon a collateral promise, and not for a mere debt, there 
 ought to be a request precisely alledged : but in an assumpsit for debt, 
 where a duty was due before, that being but in nature of a debt, the 
 general allegation, licet saepius requisitus, is sufficient: and for that 
 cause the judgment was stayed.^^ 
 
 10 In accord: Morris v. Stuyvesant Fire Ins. Co., 145 La. 471, 82 South. 
 586 (1919) ; Liverpool & London & Globe Ins. Oo. v. Kearney, 180 U. S. 132, 21 
 Sup. Ct. 326, 45 L. Ed. 460 (1901). 
 
 11 Where the defendant has promised to pay for certain goods or services or 
 other executed consideration, a debt exists an action for which will lie 
 without any demand for payment. Estrigge and Owles' Case, 3 Leon. 200 
 (1588), promise to pay in return for forbearance by the promisee; Case of 
 an Hostler, Yelv. 66 (1605), promise to pay for food and lodging; Eunball v. 
 Ball, 10 Mod. 38 (1711), note for money loaned payable on demand; Gibbs v. 
 Southam, 5 B. & Adol. 911 (1834), debt on bond to pay a stated sum with 
 interest. j 
 
 But if the defendant has expressly promised only to pay upon demand, there 
 being no pre-existing debt, no action lies without demand. Banks and Thwait's 
 Case, 3 Leon. 73 (1579) ; Harrison v. Mitford, 2 Bulst. 229 (1614) ; Hill Vi 
 Wade, Cro. Jac. 523 (1619) ; Lowe v. Kirby, Sir Wm. Jones, 56 (1624) ; Peck 
 v. Mithwolde, Sir Wm. Jones, 85 (1625) ; Alcock v. Blofield, Latch. 209 
 (1627) ; Birks v. Trippet, 1 Wms. Saunders, 32 (1666) ; Carter v. King, 3 
 Camp. 459 (1813) ; Dean v. Woodbridge, 1 Root (Conn.) 191 (1790). 
 
48p ^ OPERATION OF CONTRACT (Ch. 4 
 
 NEW ENGLAND CONGRETE CONST. CO. v.' SHEPARD & 
 MORSE LUMBER CO- 
 
 (Supreme Judicial Court of Massachusetts, 1915. 220 Mass; 207, 107 N. E. 917.) 
 
 Action by the New England Concrete Construction Company 
 against the Shepard & Morse Lumber Company. To certain rulings 
 at the trial, plaintiff excepts. Exceptions overruled. 
 
 Crosby, J. The contract upon which this action is brought arises 
 from certain letters and an "order slip" delivered to the plaintiff by 
 the defendant. By the terms of the contract the defendant agreed to 
 manufacture and furnish the plaintiff 58,000 feet of No. 1 maple 
 flooring, in accordance with certain specifications, for the sum of 
 $37.50 per thousand, delivered at Salem, Massachusetts. 
 
 The defendant, in its letter to the plaintiff dated January 14, 1913, 
 states : "We will forward the order to our Burlington, Vermont, mill 
 and will make preparations to have it filled as requested." 
 
 The fair inference from this evidence is that the flooring so to be 
 furnished by the defendant was to be manufactured by it at its mill in 
 Burlington, Vermont; at least the presiding judge before whom the 
 case was tried without a jury could have so found. 
 
 The contract contained a further provision that: "All contracts 
 are contingent upon strikes, fires, breakage of machinery and other 
 causes beyond our control." 
 
 The evidence shows that on February 19, 1913, and before any of 
 the flooring had been manufactured or delivered to the plaintiff the 
 defendant's mill at Burlington was destroyed by fire ; that the defend- 
 ant duly notified the plaintiff by letter of that fact and of its inability 
 for that reason to carry out the contract. 
 
 The agreement is not an absolute contract by which the defendant 
 agreed to furnish the flooring to the plaintiff, but was subject to cer- 
 tain conditions, including the condition that the contract was contin- 
 gent upon fires ; that is to say, the defendant was excused from per- 
 forhiance in the event of the happening of any of the contingencies 
 set forth in the contract. Davis v. Columbia Coal Mining Co., 170 
 Mass. 391, 49 N. E. 629. 
 
 The effect of this clause was not to extend the time of performance 
 beyond the time limit, but wholly to, relieve the defendant from thfe ob- 
 ligation to furnish the flooring called for by the contract. Metropoli- 
 tan Coal Co. V. Billings, 202 Mass. 457, 462, 89 N. E. 115. 
 
 The plaintiff contends that the word "fires" in the clause in ques- 
 tion is to be construed in connection with the phrase "and other causes 
 beyond our control," and that the last clause qualifies the other causes 
 enumerated so that the word "fires" nieans "fires beyond the control 
 of the defendant," and that the burden of proof was upon the defend- 
 ant to show that the fire which occurred was beyond its control. yVe 
 do not agree with this construction of the fire and strike clause. ; The 
 
Sec. 1) EXPEESS CONDITIONS PRECEDENT 489 
 
 language used is clear and free from ambiguity, and interpreting the 
 words according to their natural knd 'ordinary meaning, we are of 
 opinion that the contingency of fires is 'independent of and distinct 
 from all otlier causes enumerated, and cannot be construed as "fires 
 beyond the control of the defendant." 
 
 The mill having been destroyed by fife, the defendant is wholly re- 
 lieved from performance ; at least, in the absence of evidence to show 
 thsit the fire was the result of its willful and iiitentional wrong, or of 
 that 6f its servants or agents. '' 
 
 The' case at bar is to be distinguished from such cases as Oakman 
 V. Boyce, 100 Mass. 477, Garfield & Proctor Coal Co. v. Pennsylvania 
 Coal & Coke Co., 199 Mass. 22, 84 N. E. 1020, and Metropolitan Coal 
 Co. V. Billings, 202 Mass. 457, 89 N. E. 115, all of which cases involv- 
 ed the construction of strike clauses in contracts for the sale and de- 
 livery of coal, biit where the contracts, properly construed, did not ex- 
 cuse performance absolutely, and where it was held that coal compa- 
 nies were required to make reasonable efforts to fulfill the contracts 
 notwithstanding strikes. 
 
 There was evidence to show that the defendant was a lessee of its 
 mill in Burlington which its lessor was under no legal obligation to 
 rebuild after the fire ; that the defendant had no other mill where the 
 flooring could have been manufactured, and that it could not have 
 been furnished to the defendant, had the mill been rebuilt, until the 
 latter part of June 1913. 
 
 Whether the contract is to be construed as requiring the defendant 
 to deliver the flooring about June first, or "as i-equired about June 
 first," we are of opinion that upon all the evidence it could have been 
 found that time was an essential part of the contract and was so con- 
 templated by the parties; arid the judge was warranted in finding that 
 by reason of the destruction of the mill by fire it was impossible for 
 the defendant to perform the contract according to its terms. Pick- 
 ering V. Greenwood, 114 Mass. 479. 
 
 We perceive no. error in the manner in which the presiding jtidge 
 dealt with the requests for rulings, and are of opinion that the finding 
 was warranted. 
 
 Exceptions overruled.^^ 
 
 AUDETTE v. VUNION ST. JOSEPH. 
 (Supreme Judicial Court of Massachusetts, 1901. 178 Mass. 113, 59 N. E. 668.) 
 
 Action by Malvina Audette, administratrix of the estate of I^ouis 
 Audette, deceased, against L'Union St. Jo,se:ph. From a judgment 
 in favor of. defendant, plaintiff appeals. Affirmed. 
 
 A by-law of the defendant association provided that no sick n^em- 
 
 : ^2 In Elliott V. Blake, 1 Ley. 88 (1662), there was a promise to deliver 
 goods, ''provided that, If fire or water disable him, he should be excused." 
 
490 , OPBKATION OF OONTEACT (Ch. 4 
 
 ber should receive any benefits before producing a sworn certificate; 
 of a physician. The physician who attended plaintiff's intestate in 
 his last sickness refused to give a sworn certificate because of con- 
 scientious scruples against making an bath. 
 
 LoRiNG, J. This case comes within the rule that where one engages 
 for the act of a stranger he must procure the act to be done, and the 
 refusal of the stranger, without the interference of the other party, is 
 no excuse. That rule has been applied in this commonwealth to the 
 obligation of a person, insured under a fire insurance policy, to fur- 
 nish to the fire insurance company a certificate, under the hand and 
 seal of a magistrate, notary public, or commissioner of deeds, stating 
 that he has examined the circumstances attending the loss, knows the, 
 character and circumstances of the assured,, and believes that the 
 assured has, without fraud, sustained loss on the property insured to 
 the amount certified. Johnson v. Insurance Co., 112 Mass. 49. In 
 that case it waS; held that the plaintiff was not excused from produc- 
 ing such certificate by showing that he applied to two magistrates 
 for such a certificate in vain, and used his best efforts to procure it, 
 accompanied by proof of the facts which were to be certified to. And 
 this case was confirmed in DoUiver v. Insurance Co., 131 Mass. 39, 
 44; To the same effect, see Insurance Co. v. Lawrence, 10 Pet. 507, 
 9 Iv. Ed. 512; .Etna Ins. Co. v. People's Bank, 8 U. S. App. 554, 10 
 C. C. A. 342, 62 Fed. 222; Kelly v. Sun Eire Office, 141 Pa. 10, 
 20, 21, 21 Atl. 447, 23 Am. St Rep. 254; Daniels v. Insurance Co., 50 
 Conn. 551; Roumage v. Insurance Co., 13 N. J. Law, 110; Lane v. 
 Insurance Co., 50 Minn. 227, 52 N. W. 649, 17 L. R. A. 197; In- 
 surance Co. V. Duke, 43 Ind. 418; Leadbetter v., Insurance Co., 13 
 Me. 265, 29 Am. Dec. 505. 
 
 The defendant relies on the reference to Nolan v. Whitney, 88 N. Y. 
 648, in Beharrell v. Quimby, 162 Mass. 571, 575, 39 N. E. 407 ; and 
 to O'Neill V. Association (Sup.) 18 N. Y. Supp. 22. The decision in 
 O'Neill V. Association professes to be nothing more, and is nothing 
 more, than the application to a right to recover "sick benefits" of a rule 
 which is estabKshed in New York in case of building contracts. But 
 Nolan v. Whitney is not law in this commonwealth. On the contrary, 
 it is settled here that in contracts for erecting buildings or doing other 
 work, where it is stipulated that the quantity or quality of the work 
 to be done shall be determined by an engineer or architect, whose de- 
 cision shall be .final, it is not open to either party to show, when the en- 
 gineer or architect has passed upon the question submitted to him, that 
 he was in error, and ought not to have given a certificate where he in 
 fact gave one (Flint v. Gibson, 106 Mass. 391 ; Robbins v. Clark, 129 
 MlaBS. 145) ; or that the certificate given by him was erroneous (Palmer 
 V. Clark, 106 Mass. 373; and see White v. Railroad Co., 135 Mass. 
 216, 220; Trust Co. v. Abbott, 162 Mass. 148, 154, 38 N. E. 432, 
 27 L., R. A. 271). This%ction, therefore, was prematurely brought; 
 but the plaintiff, on producing a sworn certificate, unless there is 
 
Sec. 1) EXPRESS CONDITIONS PRECEDENT 491 
 
 some objection to it not now disclosed, can bring a new writ, and re- 
 cover the sick benefits noW sued for. 
 Judgment for the defendant afifirmed.^' 
 
 LAPLEAU V. SUCCESSION OE LAPLEAU. 
 (Supreme Court of Louisiana, 1919. 144 La. 988, 81 Soutli. 597.) 
 
 Suit by Philip Lapleau against the succession of Louis Victor Lap- 
 leau. From a judgment for defendant on exception to the petition, 
 plaintiff appeals. Affirmed. 
 
 Provosty, J. The petition in this case alleges that plaintiff made 
 advances to his son to enable him to study civil engineering, and that 
 this was done under an agreement that the advances were to be, repaid 
 by the son when he should "have secured such a start in the pursuit of 
 his profession of civil engineering as to be in a position, financially, 
 to repay said advances; that thereafter he commenced the practice 
 of his profession of civil engineering, but died before being: able to 
 acquire such a position financially as to enable him to repay any part 
 of said advances.",, The suit is against the succession of the son, 
 and we assume that the. property of his succession consists in his in- 
 heritance from his mother, who died after the time at which the ad- 
 vances in question are alleged to have been inade. , 
 
 The petition was excepted to, as showing no cause of action, be- 
 cause there is no allegation that the son had attained his majority and 
 was capable of contracting at the time the advances were made; and 
 because, even if he was a major, the father was under obligation to 
 support him; and, finally, because by the terms of the contract hp 
 was to repay these advances only when he should have secured such 
 a start in his , profession of civil engineering as to be in a position, 
 financially, to repay these advances, and that he died before this time 
 had arrived. 
 
 On this last ground, if not, also, on the others, the exception was 
 properly sustained. 
 
 Judgment affirmed.^* , 
 
 12 In accord: Worsley v. Wood, 6 T. R. 710 (1796), approved and followed 
 In Mason v. Harvey, 8 Ex. 819 (1853) ; Roper v. Lendon, 1 El. & El. 825 
 (1859). Contra: Lang v. Eagle Fire Co., 12 App. Div. 39, 42 N. Y. Supp. 539 
 (1896). 
 
 i*In accord: Work v. Beach, 59 Hun, 625, 13 N. T. Supp. 678 (1891); 
 Wright V. Farmers' Nat. Bank, 31 Tex. Civ. App. 406, 72 S. W. 103 (1903). 
 
492 _^ OPERATION OF CONTRACT , {Cfl. 4 
 
 SCOTT V. MORAGUES L,UMBER CO. 
 (Supreme Court' of Alabama, 1918. 202 Ala. 312, 80 South. 394.) 
 
 Suit by the Moragues Lumber Company, a corporation, against J. 
 M. Scott, for damages for breach of an agreement of charter party. 
 Judgment for plaintiff, and defendant appeals. AiSrmed. 
 
 Count 2 of the complaint as amended is as follows : 
 
 "The plaintiff claims of the defendant $13,000 as damages from 
 breach of an agreement entered into between the plaintiff and the 
 defendant on the 27th day of June, 1917, consisting of an offer by the 
 defendant that, subject to his buying a certain American vessel, 15 
 years old, which he was then figuring on and which was of about 
 1,050 tons and then due in Chile, he would charter said Vessel to the 
 plaintiff for the transportation of a cargo of' lumber from any port in 
 the Gulf of Mexico to Montevideo or Buenos Aires', for the freight of 
 $65 per thousand feet of lumber, freight to be prepaid, free of , dis- 
 count and of insurance, and the vessel to be furnished to the plain- 
 tiff within a reasonable time after its purchase by the defendant, which 
 said offer was accepted by the plaintiff, and the plaintiff avers that 
 although the defendant purchased said vessel, and although the plain- 
 tiff was at all times ready, willing, and able to comply with all the pro- 
 visions of said contract on its part, the defendiant without notifying the 
 plaintiff of said purchase, and before said vessel was delivered to him, 
 chartered said vessel to a third person, and thereby rendered himself 
 unable to comply with the said contract." * * * is 
 
 Sayre, J. * * * It is said, in the first place, that the alleged 
 contract betweeil the parties was conditioned upon the will of appel- 
 lant, defendant, and was therefore void for' want of consideration 
 or, mutuality of obligation. A valid contract niay be conditioned 
 upon the happening of an event, even though the event may depend 
 upon the will of' the party, who afterwards seeks to avoid its obliga- 
 tion. This principle is illustrated in Mclntyre Lumber Co. v. Jack- 
 son Lumber Co., 165 Ala. 268, 51 South. 767; 138 Am. St. Rep. 66. 
 Appellant was not bound to purchase the vessel; but, when he did, 
 the offer — or the contract, if the offer had been accepted — thereafter 
 remained as if this condition had never been stipulated, its mutuality 
 oir other necessary incidents of obligation depending upon its other 
 provisions and the action of the parties thereunder. Davis v. Williams, 
 121 Ala. 546, 25 South. 704; 3 Page on Contracts, § 1358. * * * 
 
 The effect" of appellee's acceptaAce, if communicated while the 
 offer was yet open, was to convert it into a binding contract. 6 R. 
 C. L. p. 605, § 27. In substance, it is alleged in the complaint that 
 appellant's offer was accepted; that appellant purchased the vessel; 
 that appellee was able, ready, and willing to perform the contract on 
 
 IS statement of facts condensed and parts of the opinion have been omitted. 
 
Sec. 1) EXPRESS CONDITIONS PRECEDENT 493 
 
 its part; but that appellant disabled himself, or failed and refused 
 to perform On his part. From the order in which the facts are al- 
 leged it is to be inferred that appellee accepted appellant's offer be- 
 fore the latter purchased the vessel, and there is no ground of demur- 
 rer questioning the sufficiency of the complaint to that effect. There- 
 upon the offei;' was converted into a binding contract to be performed, 
 if not otherwise stipulated, within a realsonable time; the promise 
 on either hand constituting the consideration of the promise on the 
 other. Appellant's purchase of the vessel was a condition precedent 
 to the existence of a binding contract; it is true ; but that was alleged, 
 as it was necessary that it should ^e. 13 C. J. p. 724, § 847, citing 
 McCormick v. Badham, 191 Ala. 339, 67 South. 609 ; Long v. Addix, 
 184 Ala. 236, 63 South. 982 ; Flouss v. Eureka Co., 80 Ala. 30 And 
 so with respect to appellee's acceptance of the offer. It was necessary 
 that appellee communicate its acceptance to appellant. 1 Page, § 43. 
 But this communication was a part of the acceptance and was covered 
 by the general allegation of acceptance. * * * 
 Affirmed.^" 
 
 MILNES V. GERY. 
 
 (In High Court of Chancery, 1807. 14 Ves. 400, 9 Eev. Kep. 307, 6 Bng. Rul. 
 
 Cas. 684.) 
 
 Previous to the marriage of John Milnes and Mary Selina Gery, one 
 third part of certain estates was settled in trust for them for life. 
 By the agreement of settlement it was provided that the trustee should 
 have a power to sell this one third interest with the approval of said 
 John and Mary, and that the owner of the balance of the estates, one 
 Hugh Wade Gery, should have the option to buy said one third in- 
 terest, at a price to be determined 'by two appraisers, one of whom was 
 to be named hy John and Mary and the other by Hugh, and in case 
 of disagreement by an umpire to be named by the two appraisers. John 
 Milnes gave a bond in the penal sum of ;£12,000 to carry out the agree- 
 ment, in case Hugh Wade Gery should give a certain six months no- 
 tice of his intention to purchase. The notice was properly given by 
 Hugh, and each party named an appraiser. The two appraisers differed 
 greatly in their estirnates, and they were utterly unable to agree upon 
 a third person to act as umpii-e. 
 
 The plaintiff therefore filed this bill to have the agreement car- 
 ried into execution, praying that the notice by the defendant may be 
 considered 'binding, and that a proper person or persons may be ap- 
 
 1' Query : What were the jural relations of the parties after acceptance by 
 the plaintiff and before the purchase of the vessel by the defendant? 
 ' In most "option" contracts the condition Is usually a fact within the con- 
 trol of the promisee. 
 
404 OPERATION OF CONTRACT (Ch. 4 
 
 pointed by the Court to make a valuation, or that the valuation should 
 be ascertained in such other manner as the court should direct." 
 
 The Master of the Rolls (Sir William Grant). The more I 
 have considered this case, the more I am satisfied, that independently 
 of all other objections, there is no such agreement between the par- 
 ties, as can be carried into execution. The only agreeme^it into which 
 the defendant entered, was to purchase at a price to be ascertained 
 in a specified mode. No price having ever been fixed in that mode, 
 the parties have not agreed upon any price. Where, then, is the com- 
 plete and concluded contract, which this Court is called upon to- 
 execute? The price is of the essence of a contract of sale. In this 
 instance the parties have agreed upon a particular mode of ascer- 
 taining the price. The agreement, that the price shall be fixed in one 
 specific manner, certainly does not afford an inference that it is wholly 
 indifferent in what manner it is to be fixed. The Court declaring 
 that the one shall take, and the other shall give, a price fixed in any 
 other manner, does not execute any agreement of theirs; but makes 
 an agreement for them, upon a notion, that it may be as advantageous 
 as that which they made for themselves. How can a man be forced to 
 transfer to a stranger that confidence, which upon a subject, materially 
 interesting to him, he has .reposed in an individual of his own selec- 
 tion? No substantial difference arises from the circumstance, that in 
 this case the decision may ultimately fall to an umpire, not directly 
 nominated by the parties, as through the medium of the original nom- 
 inees they had an influence upon/ the choice. No one could be chosen 
 without the concurrence of the persons in whose judgment they.recip^ 
 rocally confided. 
 
 The case of an agreement to sell at a fair valuation is essentially 
 different. In that case no particular means of ascertaining the value 
 are pointed out; there is nothing, therefore, precluding the court 
 from adopting any means adapted 'to that purpose. The case, in 
 which the Court has modified particular, subordinate parts of an agree- 
 ment falls far short of the decree, that is now demanded. Perhaps 
 some of those cases may be thought rather to require defence for the 
 length to which they have gone, than to furnish a justification for still 
 farthfer extending the discretionary power, of which they are instances. 
 The Court never professes to bind a man to any agreement, except 
 that which he has made ; but sometimes holds the agreement, which it 
 executes, and that which he has made, to be substantially the same; 
 when to common understandings there is a very perceptible difference 
 between them. The Court, however, has never gone the length of com- 
 pelling a party to buy or sell the whole subject of his agreement at a 
 price that he has never fixed, and that was never fixed in any mode to 
 which he has given his consent. 
 
 " The statement of facts has been rewritten and the arguments of counsel 
 are omitted. 
 
Sec. 1) EXPRESS CONDITIONS PRKOEDENT 495 
 
 In the case of Hall v. Warren, 9 Ves. 605, it was rather assumed, 
 than proved, that if Warren was competent to enter into the agree- 
 ment, some means might be found to carry it into execution. Th&t 
 was so little discussed, that the attention of the Court was not drawn 
 to the point ; and the doubt, recently thrown upon that point in the case 
 Q-f Cooth V. Jackson, 6 Ves. 12, was not at all adverted to. I state it as a 
 doubt only, as the decision was ultimately upon a different ground ; but 
 neither Lord Rosslyn nor Lord Eldon conceived that the Court could 
 be substituted for the arbitrators, to make a division of the estate. 
 The division of an estate does not imply more personal confidence, or 
 which other persons will be less capable of .executing, than the as- 
 certainment of value; and the admission there was, that the defendant 
 was instrumental in preventing the awai;d by private instructions to 
 the arbitrator. Upon the principle, that a fixed price was an essential 
 ingredient in a contract of sale, the ancient Romari lawyers doubted 
 whether an agreement, that did not settle the price, was at all bind- 
 ing. Justinian's Institutes and the Code state that doubt ; ^* and re- 
 solve it by declaring that such an agreement should be valid and com- 
 plete, when and if the party to whom it was referred, should fix the 
 price : otherwise it should be totally inoperative : "quasi nullo pretio 
 statuto;" and such clearly is the law of England. 
 
 I do not know, that upon this point there can be any difference be- 
 tween decisions at law and in equity. If you go into a Court of Law 
 for damages, you must be able to state some valid, legal contract, which 
 the other party wrongfully refuses to perform; if you come to a 
 Court of Equity for a specific performance, you must also be able to 
 state some contract, legal or equitable, concluded between the parties, 
 which the one refuses to execute. In this case the plaintiff seeks to 
 compel the def endatit to take this estate at such price as a master of 
 this Court shall find it to be worth, admitting, that the defendant never 
 made that agreement; and my opinion is, that the' agreement he has 
 made is not substantially, or in any fair sense, the same with that ; and 
 it could only be by an arbitrary discretion that the Court could substi- 
 tute the one in the place of the other. 
 
 This bill must therefore be dismissed without costs.^* 
 
 18 Justinian, Institutes, III, 23, 1. And see annotations in 6 E. R. C. 690. 
 
 i» The decision or approval of a third party is often made a condition. Old 
 Colony St. Ey. Co. v. Brockton & P. St. Ry. Co., 218 Mass. 84, 105 N. E. 866 
 (1914) ; Thurnell v. Balbirnie, 2 M. & W. 786 (1837) to pay at a valuation 
 made by M. and N. ; Rogers v. Maloney, 85 Or. .61, 165 Pac. 357 (1917) ; 
 Chapman v. Ferguson, 152 Mo. App. 84, 132 S. W. 284 (1910), to pay on the 
 order of X. ; Wilhelm v. Wood, 151 App. Div. 42, 135 N. Y. Supp. 930 (1912), 
 on the approval of our attorney, J. T. 
 
 Cases where the certificate of an architect or engineer is a condition preced- 
 ent to the duty to pay for the work are of the same character as those above ; 
 they will be found later, along with certain other building and construction 
 contracts. See post, p. 628. 
 
496 OPBEATION OF CONTRACT (Ch. 4 
 
 HAMILTON V. HOME INS. CO. 
 
 (Supreme C!ourt of tlie United States l890. 137 U. S. 370, 11 Sup. Ct. 133, 
 
 34 L. Ed. 708.) 
 
 Ii^ Error to the Circuit Court of the United States for the Southern 
 District of Ohio. 
 
 This was an action, brought June 26, 1886, upon a policy of in- 
 surance,- numbered 3,190, by which the Home Insurance Company 
 of New York insured Robert Hamilton for one year from February 
 23, 1886, on a stock of tobacco in his warehouse at 413 and 415 Madi- 
 son street in Covington in the state of Kentucky, against loss or 
 damage by fire to the amount of $5,000, "to be paid sixty days after 
 due notice and proofs of the same shall havp been made by the as- 
 sured and received at the office of the company in New York." 
 
 The policy, after providing that in case of loss the assured should 
 forthwith give notice, and as soon afterwards as possible furnish 
 proofs of loss, with a magistrate's certificate, submit to examination 
 on oath, and produce books and vouchers, and copies of lost books 
 and invoices, further provided, among other things, as follows : 
 
 "When personal property is damaged, the assured shall forthwith 
 cause it to be put in order, assorting and arranging the various articles, 
 according to their kinds, separating the damaged from the undamaged, 
 and shall cause an inventory to be made and furnished to the company 
 of the whole, naming the quantity, quality, and cost of each article. 
 The amount of sound value and of damage, shall then be ascertained 
 by appraisal of each article by competent persons (not interested in 
 the loss as creditors or otherwise, nor related to the assured or suf- 
 ferers) to be mutually appointed by the assured and the company, 
 their report in writing to be made under oath before any magistrate, or 
 other properly commissioned person, one-half of the appraisers' fees to 
 be paid by the assured. The company reserves the right to take the 
 whole or any part of the articles at their appraised valuej and, until 
 such proofs, declarations, and certificates are produced, and examina- 
 tions and appraisals permitted by the claimant, the loss shall not be 
 payable." 
 
 "But provided, in case differences shall arise touching any loss 
 or damage, after proof thereof hasbeen received in due form, the mat- 
 ter shall, at the written request of either party, be submitted to im- 
 partial arbitrators, whose award in writing shall be binding on the 
 parties as to the amount of such loss or damage, but shall not decide the 
 liability of the company under this policy." 
 
 "And it is hereby understood and agreed by and between this com- 
 pany and the assured that this policy is made and accepted in refer- 
 ence to the foregoing terms and conditions, and to the classes of 
 hazards and memoranda printed on the back of this policy, which 
 are hereby declared to be a part of this contract, and are to be used 
 
Seel) EXPRESS CONDITIONS PRECEDENT 497 
 
 and resorted to in order to determine the rights and obligations of the 
 parties hereto in all cases not herein otherwise specially provided for 
 in writing." 
 
 The answer admitted the execution of the policy, and notice of 
 loss; put in issue the amount of loss; denied that the plaintiff ever 
 delivered ' due proofs of loss, or had performed the conditions of the 
 policy on his part; and, after reciting the substance of the provisions 
 above quoted, alleged as follows : "And the defendant says that 
 differences having arisen touching the loss and damage sustained 
 by" said plaintiff under said policy and the amount thereof, the plain- 
 tiff claiming a loss of $40,000, and the defendant claiming and be- 
 lieving that it was slight and but a very small part of said sum, and 
 being unable to agree upon the amount of said loss, this defendant re- 
 quested and demanded in writing that the amount of such loss and 
 damage should be submitted to and ascertained and determined by 
 impartial arbitrators, whose award in writing should be binding upon 
 the parties as 1o the amount of loss or darriage, but should not decide 
 the liability of the company under said policy. And the said defendant 
 further says that the plaintiff wholly disregarded the terms and con- 
 ditions of said policy in that respect, and neglected and refused to 
 have such arbitration, afid refused to choose or submit to arbitrators 
 chosen in accordance with the terms and provisions of said policy 
 the amount of the loss or damage by fire to the property covered by 
 said policy, and refused to be governed in the ascertainment of said 
 loss by any of the terms and conditions of said policy, and, against 
 the protest of the defendant, proceeded to and did sell all of said 
 property at auction. An arbitration and the ascertainment of the 
 said loss thereby, as provided in said policy, became impossible, and 
 this defendant was deprived of its rights and privileges under said 
 policy with respect to said property and the appraisement thereof; 
 This defendant further says that the damage done to the property 
 insured was of such a nature as to require careful and scrutinizing 
 examination to ascertain the injury thereto and loss thereOn, and that 
 an appraisement by arbitrators, as required by the terms and con- 
 ditions of said policy, was of the greatest importance to the defendant, 
 and the only means under said policy whereby the exact amount of 
 dadage and injury sustained by said plaintiff upon said property could 
 be determined; and the said pla^intiff, by the sale of said property, 
 and in disregarding the terms and conditions of said policy in that re- 
 spect, wholly deprived this defendant of the right to an arbitration, as 
 provided in said policy, and all other rights in respect to the property 
 so injured or damaged by said fire. The defendant further says 
 that by reason of the failure and refusal of said ■ plaintiff to agree 
 upon arbitrators to determine the amount of the loss and damage so 
 sustained as aforesaid, and his refusal to submit the amount of such 
 loss to arbitration in accordance with the plain terms and provisions 
 of said policy, and 'the sale of said property so injured as aforesaid 
 
 COEBIN CONT 32 
 
498 OPERATION OF CONTRACT (Ch. 4 
 
 against the written protest of the defendantj the said plaintiflf is not 
 entitled to recover in this action, nor to have or maintain this action 
 against the said defendant." The plaintiff filed a replication, deny- 
 ing these, allegations of the answer. * * * 20 
 
 Upon the evidence, the court instructed the jury that, on the issues 
 joined on the special defenses in the answer, the plaintiff could not 
 recover, and that they should return a verdict for the defendant, 
 The plaintiff tendered a bill of exceptions to these instructions, and, 
 after verdict and judgment for the defendant, sued out this writ of 
 error. 
 
 Mr. Justice Gray. This case resembles in some aspects that of Ham- 
 ilton V. Insurance Co., 136 U. S. 242, 10 Sup. Ct, 945, 34 L. Ed. 419 
 (decided at the last term), but it is essentially different in important 
 and controlling elements. 
 
 In that case, the effect of the provisions of the policy by reason of 
 which it was held that the assured, having refused to submit to the 
 appraisal and award provided for, could not maintain his action, was 
 thus stated by the court : "The conditions of the policy in suit clearly 
 and unequivocally manifest the intention and agreement of the parties 
 to the contract of insurance that any difference arising between them 
 as to the amount of loss or damage of the property insured shall be 
 submitted, at the request in writing of either party, to the appraisal of 
 competent and impartial persons, to be chosen as therein provided, 
 whose award shall be conclusive as to the amount of such loss or 
 damage only, and shall not determine the question of the liability of 
 the company ; that the company shall have the right to take the whole 
 or any part of the property at its appraised value so ascertained; 
 and that until such an appraisal, shall have been permitted, and such 
 an award obtained, the loss shall not be payable, and no actidn shall 
 lie against the company. The appraisal, when requested in writing 
 by either party, is distinctly made a condition precedent to the payment 
 of any loss, and to the maintenance of any action." 136 U. S. 254, 
 255, 10 Sup. Ct. 949, 34 L. Ed. 419. That policy looked to a single 
 appraisal and award, to be made as one thing, and. by one board of 
 appraisers or arbitrators, whenever any difference should arise be- 
 tween the parties, and to be binding and conclusive as to the amount of 
 the loss, although not to determine the question of the liability of the 
 company; and the policy contained, not only a provision that until 
 such an appraisal the loss should not be payable, but an express con- 
 dition that no action upon the policy should be sustainable in any 
 court until after such an award. 
 
 In the case now before us, on the other hand, the appraisal and 
 the award are distinct things, and to take place at separate times, 
 and the effect assigned to each is quite different from that given tp 
 the appraisal and award in the other policy. The "appraisal," 
 
 2" A statement of the correspondence between the parties and as to the evi- 
 dence introduced is omitted. 
 
Seel) EXPRESS Conditions precedent 499 
 
 without which the loss is not payable, is required to be made not 
 merely when differences arise as to its amount, but in all cases, and 
 results in a mere "report in wi-iting," which is not decfered to be 
 binding upon the parties in any respect, and is in truth but a part of 
 the proofs of loss. It is only by a separate and independent provision, 
 and when differences arise touching any loss "after proof thereof has 
 been received in due form," that the matter is required, at the request 
 of either party, to be submitted to "arbitrators, whose award in writing 
 shall be binding on the parties as to the amount of such loss, but 
 shall not decide the liability of this company under the policy; " and 
 there is no provision whatever postponing the right to sue until after 
 an award. The special defenses set up, with some tautology and 
 surplusage, in the answer^ reduce themselves, when scrutinized, to 
 a single one, the plaintiff's refusal to submit to an award of arbitra- 
 tors, as provided in the policy. This appears by the general frame of 
 the answer, and by its speaking of the award as "an arbitration and 
 the ascertainment of the said loss thereby," and as "an appraisement by 
 arbitrators," as well as by the distinct avferments that the defendant 
 requested and the plaintiff declined a submission to arbitration, and 
 by the omission of any specific allegation that the plaintiff neglected 
 to procure a report of appraisers. The evidence introduced at the 
 trial w^s to the same effect. Proofs of loss, sent by the plaintiff to the 
 defendant, with a request that any defects in substance or form might 
 be pointed out so that he might perfect the proofs to the defendant's 
 satisfaction, were received by the defendant, withoiit then or after- 
 wards objectirig to their form or sufficiency. The subsequent cor- 
 respondence between the parties was evidently influerlced in form by 
 embracing insurances in different companies under policies with 
 various provisions ; but, as applied to the policy in suit,, it manifestly 
 related, and was understood by both parties to relate, not to a 'mere 
 feport of appfaisers, but to an award of arbitrators which should bind 
 both parties as to the amount of the loss.' The instruction to the 
 jury, therefore, that on the issues joined on the special defenses in the 
 answer, and upon the evidence in the case, the plaintiff could not 
 recover, was, in effect, a ruling that the plaintiff could not maintain 
 his action because he had refused to submit the amount of his loss 
 to arbitration. 
 
 A provision in a contract for the payment of money upon a contin^ 
 gency that the amount to be paid shall be submitted to arbitrators, 
 whose award shall be final as to that amount, but shall not deter- 
 mine the general question of liability, is undoubtedly valid. If the 
 contract f jirther provides that no action upon it shall be maintained 
 until after such an award, then, as was adjudged in Hamilton v. 
 Insurance Co., /above cited, and in many cases therein referred to, 
 the award is a condition precedent to the right of action. But when 
 no such condition is expressed in the contract, or necessarily to be 
 implied from its terms, it is equally well settled that the agreement for 
 
500 OPERATION. OF CONTRACT (Ch. 4 
 
 submittiiig the amouht to arbitration is collateral and independent; and 
 that a breach of this agreetnent while it will support a separate action, 
 cannot be pleaded in bar to an action on the principal contract. Roper 
 V. Lendon, 1 El. & El. 825; Collins v. Locke, L. R. 4 App. Cas. 674; 
 Dawson v. Fitzgerald, 1 Exch. Div. 257; Reed v. Insurance Co., 
 138 Mass. 572; Seward v. City of Rochester, 109 N. Y. 164, 1^ N. 
 E. 348; Insurance Co. v. Pulver, 126 111. 329, 338,. 18 N. E. 804, 9 
 Am. St. Rep. 598; Crossley v. Insurance Co. (C. C.) 27 Fed. 30. 
 The rule of law upon the subject was well stated in Dawson v. Fitzger- 
 ald, by Sir George Jessel, M. R., who said: "There are two cases 
 where, such a plea as the present is successful ; First, where the ac- 
 tion can only be brought for the sum named by the arbitrator; sec- 
 ondly, where it is agreed that no action ^hall be brought till there 
 has been an arbitration, or that arbitration shall be a condition pre- 
 cedent to the right of action. In all other cases where there is, first, 
 a covenant to pay, and, secondly, a covenant to refer, the covenants 
 are distinct and collateral, and the plaintiff may sue on the first, leav- 
 ing the defendant" "to bring an action for not referring," or (under a 
 modern English statute) "to stay the action till there has been an ar- 
 bitration," 1 Exch. Div. 260. Applying this test, it is quite clear that 
 the separate and independent provision, in the policy now before 
 us, for submitting to arbitration the. amount of the loss, is a distinct 
 and collateral agreement, and was wrongly held by the circuit court 
 to bar this action. 
 
 Judgment reversed, and case remanded, with directions to set aside 
 the verdict, and to take such further proceedings as may be consistent 
 with this opinion. ^^ 
 
 . GRAHAM et al. v. GERMAN AMERICAN INS. CO. 
 
 (Supreme Court of OUo, 1907. 75 Ohio St. 374, 79 N. E. 930, 15 L. R. A. 
 [N. S.] 1055, 9 Ann. Cas. 79.) 
 
 Action by Graham and others against the German American Insur- 
 ance Company. Judgment for defendant, and plaintiffs bring error. 
 Affirmed." " 
 
 2 1 Promises to submit to arbitration are generally held to be collateral and 
 Jfidependent ; the award will not be a condition precedent, unless so provided 
 'in express terms. Mecartney v. Guardian Trust Co., 274 Mo. 224, 202 S. W. 
 1131 (1918) ; brocklehurst & Potter Co. v. Marsch, 225 ■ Mass. 3, 113 N. B. 
 646 (1916); Aktieselskabet Kom-Og ; Foderstof Kompagniet v. Rederi- 
 aktiebolaget Atlanten ,(D. C.) 232 Fed. 403 (1916) ; iFiavelle v. Red Jacket 
 Consol. Coal & Coke Co., 82 W. Va. 295, 96 S. E. 600 (191§), "while a breach 
 of the agreement will support, a separate action, it cannot' be, pleaded in 
 bar." See, also,, Lowndes v. Earl of Stamford, 18 Q. B. 425, (1852). 
 
 But compare Holmes v. Richet, 56 Cal, 307. 38 Am. Rep. 54 (1880) ; Presi- 
 dent, etc., of Delaware & H. Canal Co. v.' Pennsylvania Coal Co.,; 50 N. Y. 250 
 (18T2). 
 
 22 Two other cases were considered at the same time. Statements in regard 
 to them are omitted. ; ; 
 
Sec. 1) EXPRESS CONDITIONS PRECEDENT 501 
 
 In tlais case the policy contained provisions as follows : 
 
 "This company shall not be liable beyond the actual cash value of 
 the property at the time any loss or damage occurs, and the loss or 
 damage shall be ascertained or estimated according to such actual cash 
 value, with proper deduction for depreciation however caused, and 
 shall in no event exceed what it would then cost the insured to repair 
 or replace the same with material of like kind and quality; said as- 
 certainment or estimate shall be made by the insured and this compa- 
 ny, oi, if they differ, then by appraisers, as hereinafter provided; and, 
 the amount of loss or damage having been thus determined, the sum 
 for which this company is liable pursuant to this policy shall be paya- 
 ble sixty days after due notice, ascertainment, estimate and satisfac- 
 tory proof of the loss have been received by this company in accord- 
 ance with the terms of this policy. * * * 
 
 "In the event of disagreement as to the amount of loss the same 
 shall, as above provided, be ascertained by two competent and disin- 
 terested appraisers, the insured and this company each selecting one, 
 and the two so chosen shall first select a competent and disinterested 
 umpire; the appraisers together shall then estimate and appraise the 
 loss, stating \separately sound value and damage, and, failing to agree, 
 shall submit their differences to the umpire; and the award in writ- 
 ing of any two shall determine the amount of such loss ; the parties 
 thereto shall pay the appraisers respectively selected by them and shall 
 bear equally the expenses of the appraisal and umpire. 
 
 "This company shall not be held to have waived any provision or 
 condition of this policy or any forfeiture thereof by any requirement, 
 act, or proceeding on its part relating to the appraisal or to any ex- 
 amination herein provided for; and the loss shall not become payable 
 until sixty days after the notice, ascertainment, estimate, and satis- 
 factory proof of the loss herein required have been received by this 
 company, including an award by appraisers when appraisal has been 
 required. * * * 
 
 "No suit or action on this policy, for the recovery of any claim, 
 shall be sustainable in any court of law or equity until after full com- 
 pliance by the insured with all the foregoing requirementSj nor unless 
 commenced within twelve months next after the fire. * * * This 
 policy is made and accepted subject to the foregoing stipiilations and 
 conditions. * * *" 
 
 Davis, J.^^ (after stating the facts). These cases have been the sub- 
 ject of unusual and protracted consideration, not only on account of 
 the intrinsic impair tance of the questions involved, ' but also because 
 there is a divergence of views in the lower courts, and a variance be^ 
 tween two reported decisions of this court. * * * 
 
 In several reported cases, not "in numerous cases and supported by 
 the greiat weight of authority," it has been assumed, rather than dem- 
 
 ,*' Parts of opinion, are omitted. 
 
502 OPERATION OF CONTRACT . (Ch. 4 
 
 onstrated by a proper course of reasoning, that the effect of the clause 
 quoted above is that the conditions relating to arbitration and ap- 
 praisal do not become obligatory on the insured until appraisal has 
 been required, in the sense of having been requested or demanded by 
 the insurer, notwithstanding a stipulation in the policy, as in those 
 now before the court, that : "No suit or action on-this policy, for the 
 recovery of any claim, shall be sustainable in any court of law or eq- 
 uity until after full compliance by the insured with all the foregoing re- 
 quirements." The contrary view is supported by several courts of 
 high standing in carefully considered and well-reasoned opinions, 
 which will be cited further on. It also logically results from the rul- 
 ing in Insurance Co. v. Carnahan, supra, upon like policies, although 
 in those cases there had been a demand for appraisal, by the insurers, 
 that the condition as to arbitration or appraisement is a condition 
 precedent and to entitle the insured to maintain an action to recover 
 under the policy, he must show that he has either performed the con- 
 dition or has a legal excuse for nonperformance thereof. To state it 
 in another form, in case of a disagreement between the insurer and 
 the insured as to the amount of the loss, the contract gives to the in- 
 sured no right of action upon the policy, but only the right to enforce 
 an award, unless the insurer has waived the condition by refusal to 
 proceed under it, when requested, or otherwise. Carroll v. Girard 
 Fire Ins. Co., 72 Cal. 297, 13 Pac. 863. 
 
 The Supreme Court of the United States, in Hamilton v. Home 
 Ins. Co. of N. Y., 137 U. S. 370,-11 Sup. Ct. 133, 34 L. Ed. 708, held 
 that "if a contract of insurance provides that no action upon it shall 
 be maintained until after an award by arbitrators is made as to the 
 amount due upon it, the award is a condition precedent to a right of 
 action on the contract." See, also, Hamilton v. Liverpool & London 
 & Globe Ins. Co., 136 U. S. 242, 10 Sup. Ct. 945, 34 L. Ed. 419; Old 
 Saucelito L. & D. Co. v. Com. Union Assur. Co., 66 Cal. 253, 5 Pac. 
 232 ; Scottish Union & National Ins. Co. v. Clancy, 71 Tex,; 5, 8 S. 
 W. 630. The. last paragraph of these policies, respectively, contains 
 this clause: "This policy is made and accepted subject to the fore- 
 going stipulations and conditions." A little above that occurs the fol- 
 lowing: "No suit or action on this policy for the recovery of any 
 claim shall be sustainable in any court of law or equity until after full 
 compliance by the insured with all the foregoing requirements." It 
 should be noted that the "requirements" here mentioned are require- 
 ments by the terms of the contract, not requests by the insurer, for 
 they are requirements already made and "foregoing." At the very 
 beginning of the statement of the conditions of the policy is the fol- 
 lowing: "This company shall not be liable beyond the actual cash 
 value of the property at the time any loss or damage occurs, and the 
 loss or damage shall be ascertained or (sstiijiated according to such 
 cash value * * * said ascertainment or estimate shall be made by 
 the insured and this company, or, if they differ, then by appraisers, as 
 
Seel) EXPRESS CONDITIONS PEECEDENT 503 
 
 hereina-f ter provided ; and the amount of loss or damage having been 
 thus determined, the sum for which this company is Hable pursuant 
 to this policy shall be payable sixty days after due notice, ascertain- 
 ment, estimate and satisfactory proof of loss have been received by 
 this company in accordance witli the terms of this policy." 
 
 Now, could a condition precedent be more express than this? In 
 case of difference or disagreement the "ascertainment" of the amount 
 for which the insurer shall be liable "shall be made" by appraisers, 
 and, the amount "having been thus determined," the same, not some 
 other sum, shall be payable "sixty days after due notice, ascertain- 
 ment and satisfactory proofs of loss have been received by the insurer 
 in accordance with the terms of the policy," not in accordance with 
 demand or request of the insurer. Beyond all reasoiiable dispute, this 
 is an agreement to pay only after an award. * * * 
 
 When is an appraisal required or "made necessary" ex vi termini 
 within this contract ? An award is not called for or required by this 
 agreement in every case, because in many cases, doubtless in most 
 cases, there may be no dispute over the loss, but, by the express agree- 
 ment of the parties, in the strongest terms, it is required "if they dif- 
 fer" and "in the event of a disagreement." By the terms of the con- 
 tract it is provided that, in case of disagreement, the loss does not be- 
 come payable unless an appraisal has taken place ; the "policy is made 
 and accepted subject to the foregoing stipulations and conditions," 
 one of. which is that "no suit or action on the policy shall be sustaina- 
 ble * * * until after full compliance by the insured with all the 
 foregoing requirements." It is very clear that the foregoing require- 
 ments are the requirements or conditions of the contract, and that 
 the phrase cannot fairly be applied to some future and contingent de- 
 mand or request by one of the parties. 
 
 In a given state of circumstances, these policies plainly and definite- 
 ly make the obtaining of an award, or at least an attempt in good 
 faith to obtain an award, a condition precedent to a right of action on 
 the policy, and it is elementary that the obligation of taking the initia- 
 tive, or of showing an excuse for not doing so, is upon the party who 
 has the affirmative in the action. "Where the parties, in their con- 
 tract, fix on a certain mode by which the amount to be paid shall be 
 ascertained, as in the present case, the party that seeks an enforcement 
 of the agreement must show that he has done everything on his part 
 which could be done to carry it into effect. He cannot compel the pay- 
 ment of the amount claimed, unless he shall procure the kind of evi- 
 dence required by the contract or show that by time or accident he is 
 unable to do so." United States v. Robeson, 34 U. S. (9 Pet.) 319, 327, 
 9 L. Ed. 142. See, also, 4 Encyc. PI. & Prac. 632; 5 Id. 368; 1 Cyc. 
 "692. So that, from all the foregoing considerations, our conclusion is 
 that the clause "including an award when appraisal has been requir- 
 ed" is very, far from meaning "when appraisal has been requested by 
 the insurer." 
 
504 IMPLIED AND OONSTRDGTIVB CONDITIONS PEECEDENT (Ch. 4 
 
 Yet, by the con,struction.!whidi is urg^ed upon us now,- and- which' 
 has been once adopted by this court, a condition precedent which has 
 been so clearly expressed is declared to be no condition precedent, and 
 it is not available to the insurer even as a collateral condition unless 
 upon its own demand. As we have already, said, the courts which 
 have adopted this construction have assumed, rather than demon- 
 strated, its correctness. It has been fully discussed and its weakness, 
 as we think satisfactorily shown in Murphy v. Northern British & 
 Mercantile Company', 61 Mo. App. 323; .and again in McNees v. 
 Southern Ins. Co., 69 Mo. App. 232; and these cases haye become 
 the settled law of the state of Missouri on that subject. We need not 
 extend the discussion further. In accord with the later view are the 
 opinions of the courts in Minnesota, Tennessee, and Illinois, as fol- 
 lows : Mosness v. Gerrnan-American Ins. Co. of New York, SO Minn. 
 341, 52 N. W. 932 ; Palatine Ins. Co. v. Morton-Scott-Robertson Co.. 
 106 Tenn. 558, 61 S. W. 787; Phoenix Ins. Co. v. Lorton & Co., 109 
 111. App. 63. 
 
 Having the strong convictiohs as to the proper construction and le- 
 gal effect of these policies, which we have endeavored to concisely 
 express above, we are of the opinion that the former ruling of this 
 court in Grand Rapids Ins. Co. v. Finn, 60 Ohio St. 513, 54 N. E. 545, 
 54 L. R. A. 555, 71 Am. St. Rep. 736, was wrong and the same is 
 now expressly overruled. 
 
 It follows that the judgment of the circuit court of Stark county 
 should be, and it is, affirmed;^* 
 
 SECTION 2.— IMPLIED AND CONSTRUCTIVE CONDI- 
 TIONS PRECEDENT^" 
 
 (a) Their Historical Development — Dependent and Independ- 
 ent Promises 
 
 (Early Cases, Particularly Sales of Goods and of Land) 
 
 ANDREW V. BOUGHEY. 
 (In the Court of King's Bench, 1552. 1 Dyer, 75 a.) 
 
 The declaration was that the defendant "on such a day, year, and 
 at such a place, undertook for twenty marks (the moiety of which 
 
 ="* An award was held a condition precedent in Scott v. Avery, 5 H. L. C. 
 Sll (1856) ; Eyre-Shoemaker v. Buffalo, R. & P. R. Co., 193 Fed. 387, 113 C. 
 C. A. 318 (1911;) ; Presidemti etc., of Delaware & H. Canal Co. v. Pennsylvania 
 Coal Co., 50 N. Y. 250 (1872) ; Holmes v. Richet, 56 Cal. 307, 38 Am. Rep. 
 54 (1880). 
 
 -=> The dividing line between actually Intended conditions and facts that 
 operate as conditions by pure construction of law to satis^ the prevailing con- 
 
Sec. 2) EARLY DBV^ILOPMENT .. oOn 
 
 was in hand, paid, and the residue agreed between them to be paid 
 within a certain time) that he would deUver at such a place, within 
 four days after such a Feast, four hundred pounds weight of good 
 and merchantable wax ; but the defendant, not regarding his promise 
 and undertaking, and intending to defraud the plaintiff * * * did 
 deliver to the plaintiff at the said place three hundred and seventy three 
 pounds weight of wax, falsely and deceitfully mixed with resin and 
 turpentine." [To this declaration there was a plea of accord and sat- 
 isfaction, which was held good.] And it seems for another cause, that 
 although the plea were not good, still the plaintiff shall not recover ; for 
 if it appear to the Court that the plaintiff in any action had not good 
 cause to have his action, the Court will never give judgment for him ; 
 here it appears in the beginning of the count, that for twenty marks, 
 the moiety of which was in hand paid, and the other moiety was to 
 be paid at a certain time agreed on between them ; non constat whether 
 that time was past, or to come, at the time of this action brought ; and 
 if it was past, as it shall be intended most strongly against the plaintiff, 
 and the money not paid or legally tendered, then the contract and 
 undertaking is void, for this word "for" makes the contract condi- 
 tional ; as for a marriage to be had I covenant to make an estate, etc. ; 
 if the marriage do not take effect I shall be discharged from this cove- 
 nant, * * *2« 
 
 BROCAS' CASE. 
 (In the King's Bench, 1588. 3 Tjeon. 219.) 
 
 Brocas, lord of a manor, covenanted with his copyholder, to as- 
 sure to him and his heirs, the freehold and inheritance of his copyhold ; 
 and the said copyholder in consideration of the same performed, cov- 
 enanted to pay such a sum: it was the opinion of the whole Court, 
 that the said copyholder is not tyed to pay the said sum, before the 
 assurance made, and the covenant performed: but if the words had 
 been, In consideration of the said covenant to be performed, then he 
 is bounden to pay the mony presently ; aiid to have his remedy over 
 by covenant.^' 
 
 captions of justice is quite indistinct. The distinction should constantly be 
 borne in mind ; but no grouping of cases into the two classes seems to be 
 desirable. Neither will Express Conditions be excluded from this section. 
 
 '" Part of the report is omitted; '■ 
 
 ''' If a promise was stated to be in consideration of or "for" (pro) the 
 performance promised by the other party, this was believed to make the 
 promise expressly conditional. Y. B. 15 Hen. VII, f. 10 b, pi. 7; Thorpe v. 
 Thorpe, 12 Mod. 455 (1701) ; Peeters v. Opie, 2 Wms. Saunders, 350 (1671). 
 
 Similar fine verbal distinctions were drawn in Anon., 4 Lepn. 50 (1590) ; 
 Slater v. Stone, Cro. Jac. 645 (1622) ; Lock v. Wright, 1 Strange, 569 (1723) ; 
 Thomas v. Oadwallader, Willes, 496 (1744). 
 
506 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 LEA V. EXELBY. 
 
 (In the Queen's Bench, 1602. Cro. Eliz. 888.) 
 
 Assumpsit. Whereas the defendant was possessed of such a lease 
 for years, the inheritance being the plaintiff's, in consideration the 
 plaintiff promised to pay unto him such a sum of money such a day 
 and place, that the defendant promised super solutionem inde to sur- 
 render unto him his lease: and alledgeth, that he at the day and 
 place tendered the money, and that the defendant had not surrendered 
 his lease. The defendant pleaded non assumpsit; and found against 
 him: and it was moved in arrest of judgment, that the defendant 
 was not to make the surrender but upon the payment of the money, 
 or an express tender and refusal. And the plaintiff here hath al- 
 ledged quod obtulit; but he saith not that the defendant refused, 
 which is material, and issuable; and he might have taken issue upon 
 the refusal, if it had been alledged : and although he hath pleaded non 
 assumpsit, yet, the declaration being ill in substance, the defendant 
 may well take advantage thereof. — Coke, Attorney-General, moved, 
 that the declaration was good, and there needed not any tender and 
 refusal to have been alledged ; for it sufficeth to alledge that in con- 
 sideration he assumed to pay such a sum, the defendant assumed to 
 surrender; so there being an assumpsit against an assumpsit, it had 
 been well enough. — But all the Court held, that if the promise had been 
 in consideration he assumed to pay such a sum, that the defendant had 
 assumed to surrender, that had been sufficient; for then he is to make 
 his surrender, and he ought to take his remedy against the other for 
 the nonperformance of his promise : but here it is, that he assumed 
 to pay, and the other assumed to surrender it upon the payment, so 
 as he would not trust to his promise; but when he had paid, he would 
 then surrender it. And in the first case, he needed not alledge the 
 performance of the promise; but here in this he ought. And when he 
 saith quod obtulit, and saith not that the other accepted it or refused 
 it, his allegation of the tender is not to any purpose ; for he shall never 
 say quod obtulit only, but he ought to plead further that none was 
 there to receive it, or that he refused ; or he ought to alledge payment ; 
 and here it is matter of substance, for want whereof the declaration is 
 not good. Wherefore it was adjudged for the defendant. — ^And after- 
 wards Coke said, that Willenhall's Case was adjudged, that tender 
 without alledging a refusal was not good. 
 
Sec. 2) ^ EARLY DEVELOPMENT 507 
 
 RAYNAY V. ALEXANDER. 
 
 (In the King's Bench, 1608. Xelv. 76.) 
 
 The plaintiff declar'd, that whereas, the defendant was possessed of 
 seventeen tod of wool, and whereas colloquium fuit betwixt them for 
 fifteen tod of the seventeen tod, to be chosen by the plaintiff; the de- 
 fendant in consideration of £6 to be paid on such a day, &c. promised 
 to deliver the plaintiff prasdictas fifteen tOd of wool, and said in fac- 
 to, that he was ready at the day to pay the defendant £6 yet the de- 
 fendant had not deliver'd the plaintiff the fifteen tod of wool, to his 
 damage, &c. And upon non assimipsit pleaded, it was found for the 
 plaintiff; and it was shewn in arrest of judgtaent, that the declaration 
 was not good, because the plaintiff had not shewn, that he had chosen 
 fifteen tod out of the seventeen, and that is quasi a condition precedent ; 
 and an act to be first performed by the plaintiff before the defendant 
 is bound by his promise to do anything : quod fuit concessum per to- 
 tam curiam. But, per Popham, Chief Justice, if the defendant had 
 sold one of the tods of wool before election made by the plaintiff, that 
 had destroy'd the election, and made the promise absolute, and had 
 been the breach of it: the same law if the defendant would not have 
 permitted the plaintiff to see the wool that he might make election ; 
 for that had excused the act to be done by the plaintiff, and had been 
 a default in the defendant. And the matter aforesaid is much en- 
 forced by the word prsedictas in the declaration ; for that can be re- 
 ferr'd to nothing but the communication, by which the plaintiff of his 
 own shewing ought to make election : then the plaintiff omitting it in 
 his declaration shews the fault is in himself, which ought to be re- 
 moved before he can charge the defendant : but if the communication 
 had been, that thcj plaintiff should chuse fifteen tod of seventeen, 
 and the plaintiff had declar'd the promise to be to deliver fifteen tod 
 generally, without saying prsedictas, there, if the promise had been 
 found, the plaintiff should have judgment; for the colloquium might 
 be conditional, and the promise absolute. Quod nota. But the judg- 
 ment was, nil capiat per billara.'* 
 
 ^8 In accord, where the plaintifE or some third party must do an act before 
 it is possible for the defendant to perform as promised : Thomas v. Cadwal- 
 lader, Willes, 496 (1744), defendant promised to repair with timber to be 
 furnished by plaintiff; Armitage v. Insole, 14 Q. B. 728 (1850), defendant 
 promised to deliver coal free on board ship at Cardiff; plaintifE must 
 lirst name the ship; Cadwell v. Blake, 6 Gray (Mass.) 402 (1856), post, p. 
 722; Coombe v. Greene, 11 M. & W. 480 (1843), covenant to repair as directed 
 by a surveyor to be appointed by the plaintiff. 
 
50S IMPLIED AND CONSTRUCTIVE CONDITIONS PEECBDBNT ' (Ch. 4 
 
 NICHOLS V. RAYNBRED. 
 (In the King's Bench, 1615. Hob. 88.) 
 
 Nichols brought an assumpsit against Raynbred, declaring that 
 in consideration, that Nichols promised to deliver the defendant to his 
 own use a cow, the defendant promised to deliver him 50 shillings: 
 adjudged for the plaintiff' in both Courts, that the plaintiff need iiot 
 to aver the delivery of the cow, because it is promise for promise. 
 Note here the promises must be at one instant, for else they will be both 
 nuda pacta.^' 
 
 PORDAGE v. COLE. 
 
 (In the King's Bench, 1669, 1 Wms. Saurid. 319.) »» 
 
 Debt upon a specialty for 177 \ 15 s. The plaintiff declares that 
 the defendant, by his certain writing of agreement made at, &c. by the 
 plaintiff by the name, &c. and the defendant by the name, &c. and 
 brings the deed into Court, &c., it was agreed between the plaintiff 
 and defendant in manner and form following, (viz.) that the defendant 
 should give to the plaintiff the sum of i775 for all his lands, with a 
 house called Ashmole-House thereunto belonging, with the brewing 
 vessels remaining in the said house, and with the malt-mill and wheel- 
 
 ^i* That this case is truly representative of the law for two centuries, see, in 
 accord, Spanish Ambassador v. Giftord, 1 KoUe Kep. 336 (1616) ; Holder v. 
 Taylor, 1 Rolle, Abr. 518 (1614) ; Thorpe's Case, March, 75 (1639) ; Caton 
 V. Dixon, 1 Eolle, Abr. 415, pi. 8 (1639) ; Bragg v. Nightingale, 1 Rolle, 
 Abr. 416, pi. 15 (1649) ; Ware v. Chappel, Style, 186 (1649), with a dissent; 
 Gibbons v. Prewde, Hardres, 102 (1657) ; Hunlocke v. Blacklowe, 2 Wms. 
 Saunders, 156 (1670) ; Beany v. Turner, 1 Lev. 293 (1670), land sale; Hays v. 
 BickerstafCe, 2 Mod. 34 (1675), lease; Cole v. Shallett, 3 Lev. 41 (1682), 
 charter party; Blackwell v. Nash, 1 Str. 535 (1722), sale of stock; Martin- 
 dale V. Fisher, 1 Wils. 88 (1745), wagering contract; Terry v. Duntze, 2 H. 
 Bl. 389 (1795), installment buUding contract; Moggridge v. Jones, 14 East, 
 486 (1811). 
 
 For a modern throwback to this ancient law, see Brest v. Cole, 183 Mass. 
 283, 67 N. E3. 246 (1903). 
 
 In Thomas v. Cadwallader, Willes, 496 (1744) , it was said by Willes, J. : 
 "I expressed my dislike of those cases, though they are too many to be now 
 overruled, where it is determined that the breach of one covenant, though 
 plainly relative to the other, cannot be pleaded in bar to an action brought for 
 the breach of the other. * * * If therefore this were a new point, 1 
 should be Inclined to be of opinion that though, where there are mutual cove- 
 nants relative to one another in the same deed, a plaintiff is not obliged, in 
 an action brought for the breach of them, to aver the performance of the cove- 
 nant which is to be performed on his part, yet that the defendant in such 
 action may in his plea insist on the non-performance of the covenant to be per- 
 formed on the part of the plaintiff ; but this has been so often determined 
 otherwise, that It is too late now to alter the law in this respect." 
 
 3» Part of the report is omitted. 
 
Sec. 2) EARLY DEVELOPMENT ' 509 
 
 barrow; and that in pursuance of the said agreement, the defendant 
 had given to the plaintiff 5s. as an earnest ; and it was by the said writ- 
 ing further agreed between the plaintiil and defendant, that the defend- 
 ant should pay to the plaintiff the residue of the said sum of f 775 a 
 week after the Feast of St. John the Baptist the next following (all 
 other moveables, with the corn upon the ground, except). And al- 
 though the defendant has paid five shillings, parcel, &c. yet the said 
 defendant, although often requested, has not paid the residue to the 
 damage, &c. The defendant prays oyer of the specialty, which is 
 entered in hsec verba, to wit: "11 May, 1668,. It is agreed between 
 Doctor John Pordage and Bassett Cole, Esquire, that the said Bassett 
 Cole shall give unto the said doctor i775 for all his lands, with Ash- 
 mole-House, thereunto belonging, with the brewing-vessels as they are 
 now remaining in the said house, and with the malt-mill and wheel- 
 barrow. In witness whereof we do put our hands and seals: mu- 
 tually given as earnest in performance of this 5s. ; the money to be 
 paid before Midsummer 1668; all other moveables, with the corn 
 upon the ground, excepted." And upon oyer thereof the defend- 
 ant demurs. And Withins, of counsel with the defendant, took sev- 
 eral exceptions to the declaration: * * * 3_ The great exception 
 was, that the plaintiff in his declaration has not averred that he had 
 conveyed the lands, or>at least tendered a conveyance of them; for the 
 defendant has no remedy to obtain the lands, and therefore the plain- 
 tiff ought to have conveyed them, or tendered a conveyance of them, 
 before he brought his action for the money. And it was argued by 
 Withins, that if by one single deed two things are to be performed, 
 namely, one by the plaintiff and the other by the defendant, if there be 
 no mutual remedy, the plaintiff ought to aver performance of his part : 
 Trin. 12 Jac. 1, between Holder v. Tayloe, 1 Rol. Abr. 518 (C) pi. 2, 3; 
 Ughtred's case, and Sir Richard Pool's case, there cited, and Gray's 
 case: and that the word "pro" made a condition in things executory. 
 And here in this case it is a condition precedent which ought to be per- 
 formed before the action brought ; wherefore he prayed judgment for 
 the defendant. ' 
 
 But it was adjudged by the Couh;, that the action was well brought 
 without an averment of the conveyance of the land; because it shdl 
 be intended that both parties have sealed the specialty. And if the 
 .plaintiff has not conveyed the land to the defendant, he has also an 
 action of covenant against the plaintiff upon the agreement contained 
 in the deed, which amounts to a covenant on the part' of the plain- 
 tiff to convey the land ; and so each party has mutual remedy against 
 the other. But it might be otherwise if the specialty had been the words 
 of the defendant only, and not the words of both parties by way 
 of agreement as it is here. And by the conclusion of the deed it is 
 said, that both parties had sealed it ; and therefore, judgment was given 
 
510 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDE^JT (Ch. 4 
 
 for the plaintiff which was afterwards affirpied in the Exchequer- 
 Chamber, Trin. 22 of King Charles the Second." 
 
 81 In accord: Mattock v. Kinglake, 10 Add. & El. 50 (1839), time named 
 for payment, but not for conveyance; Wilks v. Smith, 10 M. & W. 355 (1842), . 
 fsame; Dicker v. Jackson, 6 C. B. 103 (1848) ; Slbthorp y. Brunei, 3 Exch. 826 
 (1849). Contra; Marsden v. Moore, 4 H. & N. 500 (1859). 
 
 Where the plaintiff has made no promise or covenant, so that the defendant 
 would have no affirmative remedy, the courts were astute to import a condi- 
 tion precedent to the defendant's duty. See Lock v. AVrlght, 1 Str. 569 (1723) ; 
 Collins V. Gibbs', 2 Burr. 899 (1759) ; Austin v. Jervoyse, Hob. 69 (1615), 
 plaintiff's promise voidable for infancy. 
 
 Paotnote 'by the reporter,^ Serjeant Williams: 
 
 "Almost all the old cases, and many of the modern ones on this subject, 
 are decided upon distinctions so nice and technical, that it is. very difficult, if 
 not impracticable, to deduce from them any certain rule or principle by which 
 it can be ascertained, what covenants are independent, and what dependent; 
 and of course, when it is necessary to aver perfprmance in the declaration, 
 and when not. Thus if A covenant with B to serve him for a year, and B 
 covenant with A to pay him £10i it is held that these are independent cove- 
 nants, and A may maintain an action against B for the money before any 
 service; but if B had covenanted to pay him £10 for the service, these words 
 make the service a condition precedent, and A cannot enforce payment of the 
 money untilhe has performed the service. So where A covenants with B to 
 marry his daughter, and B covenants to convey an estate to A and the daugh- 
 ter in special tail, it is said that though A marry another woman, or the 
 daughter another man, still A may have an action against B on the covenant; 
 but if B had covenanted to convey the estate for the cause aforesaid, the mar- 
 riage is a condition precedent, and no action will lie until it be solemnized. 
 15 H. 7, 10, pi. 17; Bro. Covenant, 22; 12 Mod. 460, Thorpe v. Thorpe; Hob. 
 106, Lampleigh v. Brathwait. * * * So where B covenanted with C his 
 copyholder, to assure to him and his heirs the freehold and Inheritance of his 
 copyhold, and C, In consideration of the same performed, covenanted to pay 
 such a sum. It was adjudged that this was a condition precedent, and B 
 must make the assurance before he is entitled to the money; but if the 
 words had been, in consideration of the said covenant to be performed, B 
 might bring an action for the money before he made the assurance. 3 Leon. 
 219, Broc^s's case. And lastly, where articles of agreement were made be- 
 tween A and B and a covenant by A, that, for the consideration thereafter 
 expressed, he should convey certain lands to B in fee, and B, on his part, 
 for the consideration aforesaid, covenanted to pay a sum of money to A ; it 
 was held, that these were independent covenants, and A might bring an action 
 for the money before any conveyance of the lands. 1 Rol. Abr. 415, pi. 8 S. C. 
 cited 12 Mod. 463, Thorpe v. Thorpe, 1 Ld. Raym. 605. 666, 1 Lutw. 251, 252. 
 There are many other authorities of a similar nature which I refer the reader 
 to. 1 Rol. Rep. 336, Spanish Ambassador v. Gifford ; Yelv. 133, 134, Bettisworth 
 v. Campion ; Hob. 88, Nichols v. Raynbred ; 1 Lev. 293, Beany v. Turner ; 
 Hard. 102, 103, Gibbons v. Prewde ; 1 Str. 535, Blackwell v. Nash ; Ibid. 712, 
 Dawson v. Myer; 1 Wils. 88, Martindale v. Fisher. Hence it appears that 
 the Judges in these cases seem to have founded their construction of tne 
 independency or dependency of covenants or agreements on artificial and subtle 
 distinctions, without regarding the Intent and meanlpg of the parties. For 
 -the rule which is contained in them all seems clear and Indisputable ; that 
 where there are several covenants, promises, or agreements, which are In- 
 dependent of each other, one party may bring an action against the other for 
 a breach of his covenants, &c. without averring a performance of the cove- 
 nants, &c. on his, the plaintiff's part ; and it Is no excuse for the defendant 
 to allege in his plea a breach of the covenants, &c. on the part of the plain- 
 tiff; according to Justinian's rule In the civil law, 'Qui actionem habet ad 
 rem recuperandum, ipsam rem habere, videtur.' Justin, de Regulis Juris, 
 3(51. But where the covenants, &c. are dependent, it Is necessary for the plain- 
 tiff to aver and prove a performance of the covenants, &c. on his part, to 
 
Sec. 2) , EARLY DEVELOPMENT 511 
 
 entitle himself to an action for the breach of the covenants on the part of the 
 defendant ; and so are also 7 Rep. 10 a. b. Ughtred's case ; Doug. 090, 3d ed. 
 Kingston v. Preston, cited in Jones v. Barkley. The difficulty lies in the ap- 
 plication of this rule to the particular case. It is justly obserted, that cove- 
 nants, &e. are to be construed to be either dependent or independent of each 
 other, according to the intention and meaning of the parties, and the good 
 sense of the case; and technical words should give way to such intention. 
 1 T. R. 645, Hotham v. East India Company ; 6 T. R. 688, Porter v. Shepard ; 
 Ibid. 571, Campbell v. Jones ; 7 T. R. 130, Morton v. Lamh. In order therefore 
 to discover that intention, and thereby to learn, with some degree of certainty, 
 when performance is necessary to be averred in the declaration, and when 
 not, it may not be improper to lay down a few rules, which will perhaps be 
 found useful for that purpose. 
 
 1. If a day be appointed for payment of money, or part of it, or for doing 
 any other act, and the day is to happen, or may happen, before the thing which 
 is the consideration of the money, or other act, is to be performed, an action 
 may be brought for the money, or for not doing such other act before per- 
 formance ; for it appears that the party relied upon his remedy, and did 
 not intend to make the performance a condition precedent ; and so it is where 
 no time is fixed for performance of that, which is the consideration of the 
 money or other act. Dyer, 76 a. in margine ; 1 Salk. 171, Thorpe v. Thorpe ; 
 S. C. 1 Ld. Raym. 665, 1 Lutw. 250, 12 Mod. 461 ; 1 Vent. 177, Peters V. Opie, 
 per Hale C. J. ; 2 Saund. 350, S. C. ; 1 Salk. 113, Callonel v. Briggs ; 2 H. 
 Black, 389, Terry v. Duntze ; 6 T. R. 572, Campbell v. Jones. This seems to 
 be the ground of the judgment in this case of Pordage v. Cole, the money 
 being appointed to be paid on a fixed day, which might happen before the 
 lands were, or Could be, conveyed. * * * [Rule 1 is often approved today. 
 See Mass. Biog. Soc. v. Russell, 229 Mass. 524, 118 N. E. 662 (1918) ; Glaser v. 
 Donnelley (N. M.) 170 Pac. 63 (1918) ; Allard v. Belfast, 40 Me. 369 (1855) ; 
 Powers Reg. Co. v. Hoffmann, 169 111. App. 657 (1912). But cf. Roberts v. 
 Brett, 11 H. L. C. 337 (1865)]. 
 
 But, 2. When a day is appointed for the payment of money, &c. and the 
 day is to happen after the thing which is the consideration of the money, &c. 
 is to be performed, no action can be maintained for the money, &c. before 
 performance. 1 Salk. 171, Thorpe v. Thorpe, 2d Resolution, 12 Mod. 462, 1 
 Ld. Raym. 665, 1 Lutw. 251; Dyer 76 a. pi. 30. 
 
 3. Where a covenant goes only to part of the consideration on both sides, 
 and a breach of such covenant may be paid for in damages, it is an independ- 
 ent covenant, and an action may be maintained for a breach of the covenant on 
 the part of the defendant, without averring performance in the declaration. 
 [The cases of Boone v. Elyre, 1 H. Bl. 273, and Campbell v. Jones, 6 T. R. 570, 
 were here discussed.] Hence it appears that the reason of the decision in these 
 and other siiuilar cases, besides the inequality of the damages, seems to be, 
 that where a person has received a part of the consideration for which he 
 entered into the agreement, it would be unjust that because he has not had 
 the whole, he should therefore be permitted to enjoy that part without either 
 paying or doing any thing for it. Therefore the law obliges him to perform 
 the asreement on his part, and leaves him to his remedy to recover any dam- 
 age he may have sustained in not having received the whole considera- 
 tion. * * * 
 
 4. But where the mutual covenants go to the whole consideration fn both 
 sides, they are mutual conditions, and performance must be averred. 1 Vent. 
 147, Large v. Cheshire ; 1 H. Black. 270, Duke of St. Albans v. Shore. 
 
 5. Where two acts are to be done at the same time, as where A covenants to 
 convey an estate to B on such a day, and in consideration thereof B covenants 
 to pay A a sum of money on the same day, neither can maintain an action 
 without shewing performance of, or an offer to perform his part, though it is 
 not certain which of them is obliged to do the first act : and this particularly 
 applies to all cases of sale. 1 Salk. 112, 113, Callonel v. Briggs; Ibid. 171, 
 Thorpe v. Thorpe ; 2 Salk. 623, Lancashire v. Killingworth ; Doug. 691, 3d 
 Ed., Kingston v. Preston; Ibid. 684, Jones v. Barkley; 4 T. R. 761, Goodisson 
 V. Nunn ; 6 T. R. 665, Porter v. Shephard ; 7 T. R. 125, Morton v. Lamb ; 
 8 T. R. 366, Glazebrook v. Woodrow; 2 Saund. 352, Peeters v. Opie. note 
 
512 IMPLIED AND CONSTBUCTIVE CONDITIONS PEBOEDBNT (CM 4: 
 
 CALLONEL V. BRIGGS. 
 (In the Court of King's Bench, 1703. 1 Salk. 112.) , 
 
 An agreement was, that the defendant should pay so much money 
 six months after the bargain, the plaintiff transferring stcick. The 
 plaintiff at the same time gave a note to the defendant to transfer the 
 stock, the defendant paying, &c. Et per Holt, C. J. If either party 
 would stie upon this agreement, the plaintiff for not paying, or the 
 defendant for not transferring, the one must aver and prove a trans- 
 fer or a tender, and the other a payment or a tender ; for transferring 
 in the first bargain was a condition precedent; and though there be 
 mutual promises, yet if. one thing be the consideration of the other, 
 there a performance is- necessary to be averred, unless a certain day 
 be appointed for performance: 1 Saund, 319. If I sell you my horse 
 for £10 if you will have the horse I must have the money; or, if I 
 will have the money, you must have the horse; therefore he obliged 
 the plaintiff either to prove a transfer, or a tender and refusal within 
 the six months 
 
 KINGSTON V. PRESTON. 
 
 (In the King's Bench, 1773. 2 Doug. 689, Quoted in Jones v. Barkley, 2 
 
 Doug. 684.) 
 
 "It was an action of debt, for non-performance of covenants con- 
 tained in certain articles of agreement between the plaintiff and the 
 defendant. The declaration stated :-^That, by articles made the 24th 
 of March, 1770, the plaintiff, for the considerations therein-after men- 
 tioned, covenanted, with the defendant, to serve him for one year 
 and a quarter next ensuing, as a covenant-servant, in his trade of a 
 silk-mercer, at £200 a year, and in consideration of the premises, the 
 defendant covenanted, that at the end of the year and a quarter, he 
 
 (5) ; 2 H. Black. 178, French v. Campbell; Ibid. 123, Phillips v. Fielding; 
 2 Sauud. 106, Holdipp v. Otway ; 1 East, 203, Eawson v. Johnson ; Ibid. 619, 
 Heard v. Wadham; 4 East, 477; Hall v. Cazenove; 6 East, 555, Martin v. 
 Smith." 
 
 In O^Jiorpe v. Thorpe, 12 Mod. 455 <1701), Holt, C. J., constructed similar 
 rules, and said : "What is the reason that mutual promises shall bear an 
 action without performance? One's bargain is to be performed according as he 
 makes it. If he make a bargain, and rely on the other's covenant or promise 
 to have what he would have done to him, it is his own fault. If the agreement 
 be, that A shall have the horse of B and A agree that B shall have his 
 money, they may make it so ; and then there needs no averment of per- 
 formance to maintain an action on either side ; but if it appear by the agree- 
 ment that the plain intent of either party was to have the thing to be done 
 to him performed before his doing what he undertakes of his, side, it must 
 be then averred ; as where a man agrees to give so much money for a horse, 
 it is. plain he meant to have the horse first, and, therefore, he says the money 
 shall be given for the horse." 
 
Sec. 2) EARLY DEVELOPMENT 513 
 
 would give up his business of a mercer to the plaintiff, and a nephew 
 of the defendant, or some other person to be nominated by the defend- 
 ant, and give up to them his stock in trade, at a fair valuation ; and 
 that, between the young traders, deeds of partnership should be ex- 
 ecuted, for 14 years, and from and immediately after the execution 
 of the said deeds, the defendant would permit the said young tradfii-s 
 to carry on the said business in the defendant's house. — Then the dec- 
 Taration stated a covenant by the plaintiff, that he would accept the 
 business and stock in trade, at a fair valuation, with the defendant's 
 nephew, or such other person, &c., and execute such deeds of partner- 
 ship, and, further, that the plaintiff should, and would, at, and before, 
 the sealing and delivery of the deeds, cause and procure good and 
 sufficient security to be given to the defendant, to be approved of 
 by the defendant, for the payment of £250 monthly, to the defendant, 
 in lieu of a moiety of the monthly produce of the stock in trade, until 
 the value of the- stock should be reduced to i4,0d0.— Then the plain- 
 tiff averred, that he had performed, and been ready to perform, his 
 covenants, and assigned for breach on the part of the defendant, that 
 he had refused to surrender and give up his business, at the end of the 
 said year 'and quarter. — The defendant pleaded, 1. That the plaintiff 
 did not offer sufficient security; and, 2. That he did not give suffi- 
 cient security for the payment of the £250, &c. — And the plaintiff de- 
 murred generally to both pleas. — On the part of the plaintiff, the case 
 was argued by Mr. Bull^r, who contended, that the covenants were 
 mutual and independent, and therefore, a plea of the breach of one 
 of the covenants to be performed by the plaintiff was no bar to an 
 action for a breach by the defendant of one of which he had bound 
 himself to perform, but that the defendant might have his remedy 
 for the breach by the plaintiff, in a separate action. On the other 
 side, Mr. Grose insisted, that the covenants were dependent in their 
 nature, and therefore, performance must be alleged: the security to 
 be given for the money, was manifestly the chief object of the trans- 
 action, and it would be highly unreasonable to construe the agreement, 
 so as to oblige the defendant to give up a beneficial business, and 
 valuable stock in trade, and trust to the plaintiff's personal security, 
 (who might, and, indeed, was admitted to be worth nothing,) for the 
 performance of his part. — In delivering the judgment of the Court, 
 Lord Mansfield expressed himself to the following effect: There 
 are three kinds of covenants : 1. Such as are called mutual and 
 independent, where either party may recover damages from the oth- 
 er, for the injury he may have received by a breach of the covenants 
 in his favour, and where it is no excuse for the defendant, to allege 
 a breach of the covenants on the pak of the plaintiff. 2. There are cov- 
 enants which are conditions and dependent, in which the performance 
 of one depends on the prior performance of another, and, therefore, 
 till this prior condition is performed, the other party is not liable to cm 
 
 COBBIN CONT 33 
 
514 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 action on his covenant. 3. There is also a third sort of covenants, 
 which are mutual conditions to be performed at the same time; and, 
 in these, if one party was ready, and offered to perform his part, and 
 the other neglected, or refused, to perform his, he who was ready, 
 and offered, has fulfilled his engagement, and may maintain an ac- 
 tion for the default of the other ; though it is not certain that either 
 is obliged to do the first act. — His Lordship then proceeded to say, 
 that the dependence, or independence, of covenants,' was to be col- 
 lected from the evident sense and meaning of the parties, and that, 
 however transposed they might be in the deed, their precedency 
 must depend on the order of time in which the intent of the transac- 
 tion requires their performance. That, in the case before the Court, 
 it would be the greatest injustice if the plaintiff should prevail: the 
 essence of the agreement was, that the defendant should not trust 
 to the personal security of the plaintiff, but, before he delivered up 
 his stock and business, should have good security for the payment of 
 the money. The giving iuch security, therefore, must necessarily 
 be a condition pr-ecedent. — Judgment was accordingly given for the 
 defendant because the part to be performed by the plaintiff was clearly 
 a condition precedent." 
 
 CLARK V. GULESIAN. 
 (Supreme Judicial Court of Massachusetts, 1908. 197 Mass. 492, 84 N. E. 94.) 
 
 Action by F. Warren Clark against Moses H. Gulesian for breach 
 of contract. From a judgment for defendant, entered on sustaining 
 a demurrer to the declaration, plaintiff appeals. Reversed. 
 
 The following is plaintiff's amended declaration: "And the plain- 
 tiff says that on or about the 16th day of February, A. D. 1907, the 
 defendant, requested the plaintiff to estimate the cost of erecting and 
 completing and requested the plaintiff to make an offer of a price for 
 which the plaintiff would erect and complete a building on the corner 
 of Harcourt and Irvington streets in the city of Boston in accord- 
 ance with certain plans and specifications. then and there shown by the 
 defendant to the plaintiff. And the defendant promised and agreed 
 that if the said offer of a price for erecting and completing said 
 building was accepted by the defendant the defendant would execute 
 and deliver to the plaintiff a good and sufficient bond in the sum of 
 twenty thousand dollars conditioned on the performance in all respects 
 on the part of the defendant of a contract for the erection and comple- 
 tion of said building in accordance with plans and specifications at the 
 price named in said offer. And the plaintiff says that he estimated 
 the cost of said building and made an offer of a price, to wit, the sum 
 of $77,500, for which the plaintiff would erect and complete said 
 building. And the plaintiff says that the defendant then and there 
 duly accepted said offer, and the defendant made an oral contract 
 with the plaintiff under the terms of which contract the plaintiff en- 
 
Sec. 2) EARLY DEVELOPMENT 515 
 
 tered into an agreement with the defendant to erect and finish said 
 building in accordance with said plans and specifications, and the 
 defendant agreed to pay the plaintiff the sum of seventy-seven thou- 
 sand five hundred dollars ($77,500) for the erection and completion 
 of said building from time to time as the work progressed and to 
 execute and deliver a good and sufficient bond in the sum of $20,000 
 conditioned on the performance on the part of the defendant of all 
 the obligations of said contract. And the plaintiff says that he has 
 been always ready 'and willing to carry out said contract, but the 
 defendant thereafter' neglected and refused to execute and deliver 
 any bond in accordance with his aforesaid contract, promise and agree- 
 ment, and by reason of said neglect he has been unable to carry out 
 said contract and prevented from carrying out said contract to the 
 great damage of the plaintifT." 
 
 Bralby, J. The declaration after allegations of preliminary nego- 
 tiations, sets forth the oral building contract into which the parties en- 
 tered. By its terms, the plaintiff contracted to erect and complete a 
 building according to certain plans and specifications, for which the 
 defendant agreed to pay a fixed sum "from time to time as the work 
 progressed," and to furnish a bond to secure the performance of his 
 promise. The contract having contained no provisions as to the time 
 within which the building was to be begun and finished, or the bond 
 given, the plaintiff became entitled to a reasonable time within which to 
 perform, while the delivery of the bond was intended to be concurrent 
 with the making of the contract. It evidently was the intention of 
 the parties that full compensation was not to be made until completion, 
 even if installments were to be advanced as the work progressed, and 
 the contract being indivisible, performance by one party was condi- 
 tioned, upon performance by the other. Fullam v. Wright & Colton 
 Wire Cloth Co., 196 Mass. 474, 82 N. E. 711. But while the principal 
 purpose was the erection 'of the building, yet .the giving of security for 
 the payment of the price; was intended to be a precedent condition, 
 before performance by the plaintiff could be demanded. Cad«vell 
 V. Blake, 6 Gray, 402. The plaintiff alleges his readiness to have 
 gone forward, but it is averred that the defendant absolutely refused 
 to execute and deliver the bond, and this refusal prevented him from 
 performance. By his unquahfied refusal the defendant placed himself 
 in default, and the plaintiff had the right either to rescind the contract, 
 leaving him without any cause of action, or to treat it as tefminated, 
 and bring suit for such damages as he had suffered from the breach. 
 Earnshaw v. Whittemore, 194 Mass. 187, 80 N. E. 520, 521, and cases 
 cited. 
 
 The necessary averments, upon proof of which the plaintiff is en- 
 titled at least to nominal damages having been stated with substantial 
 certainty, the declaration is sufficient, and the demurrer not well tak- 
 en. Rev. Laws, c. 173, § 6. 
 
 Judgment reversed. Demurrer overruled. 
 
516 IMPLIED AND CONSTRUCTIVE CONDITIONS PKBOEDENT (Ch. 4 
 
 MORTON V. LAMB. 
 (In the Court of King's Bench, 1797. 7 Term B. 125.) 
 
 In an action on the case the plain tifif declared against the defendant, 
 for that whereas on the 10th Feb. 1796, at Manchester, in the county 
 of Lancaster, in consideration that the plaintiff, at the special instance 
 and request of the defendant, had then and there bought of the de- 
 fendant 200 quarters of wheat at £5 Os. 6d. per -quarter, such price 
 to be therefore paid by the plaintiff to the defendant, he, the defendant, 
 undertook and then and there promised the plaintiff to deliver the 
 said com to him (the plaintiff,) at Shardlow, in the county of Derby, 
 ■ in one month from that time, viz. of the sale ; and then he alleged that 
 although he (the plaintiff) always, from the time of making such sale, 
 for the space of one month then next following and afterwards, was 
 ready and willing to receive the said corn at Shardlow, yet the de- 
 fendant not regarding his said promise, &c. did not in one month from 
 the time of the making of such sale as aforesaid, or at any other time, 
 deliver the said corn to the plaintiff at Shardlow, or elsewhere, al- 
 though he (the defendant) was often requested so to do, &c. The 
 defendant pleaded the general issue ; and at the trial the plaintiff 
 recovered a verdict. 
 
 Holroyd obtainedj in- the last term, a rule calling on the plaintiff 
 to shew cause why the judgment should not be arrested, because 
 it was not averred that the plaintiff had tendered to the defendant the 
 price of the corn, or was ready to have paid for it on delivery. He 
 said this was necessary on the principle established in many cases, 
 particularly in Thorpe v. Thorpe, Salk. 171, Callonel v. Briggs, lb, 
 113, Kingston v. Preston, 2 Dougl. 689, Jones v. B^-i'kley, 2 Dougl. 
 684, and Goodison v. Nunn, 4 T. R. 761, that when something is to be 
 done by both parties to a contract at the same time, as in this case 
 the tendering of the money and the delivery of the com, thei;e the 
 party suing the other for non-performance of his part, must aver an 
 offer at least at the same time to perform what, was to be done by 
 himself. 
 
 Law, Wood, and Scarlett, now shewed cause. The covenants here 
 are mutual and independent, and each party has a remedy by action 
 against the other for non-performance of his part. But if there be 
 any precedence between them, the delivery of the goods ought, in the 
 regular order of things, to precede the (payment of the price. In 
 neither case can the averment contended for be necessary. The dis- 
 tinction is taken in many cases, that where two things are to be done, 
 and the time of doing it is mentioned for one and not for the other, 
 there the thing for doing which ' the time is stipulated must be done 
 first, and so averred to be. * * * Here the first act to be done 
 was by the defendant, namely, the carrying of the corn to Shardlow; 
 by not doing which he broke his agreement, and a cause' of action ac- 
 
Sec. 2) EARLY DEVKLOPMENT 517 
 
 crued to the plaintiff according to that class of cases, wherein agree- 
 ments of this sort have been construed to give mutual remedies to the 
 parties. But admitting that he was not bound to deliver the corn there 
 until the plaintiff was prepared to pay for it ; still that ought to come 
 from the defendant by way of excuse, and the tender of payment was 
 not necessary to be averred by the plaintiff as a condition precedent to 
 the right of action. * * * 
 
 Holroyd, contra."^ 
 
 Lord Ken YON, C. J. If this question depended on the technical nice- 
 ties of pleading, I should not feel so much confidence as I do : but 
 it depends altogether on the true construction of this agreement. The 
 defendant agreed with the plaintiff for a certain quantity of corn, 
 to be delivered at Shardlow within a certain time, and there can be no 
 doubt but that the parties intended that the payment should be made 
 at the time of the delivery. It is not imputed to the defendant that he 
 did not carry the corn to Shardlow, but that he did not deliver it to 
 the plaintiff : to this declaration the defendant objects, and says 
 "I did not deliver the corn to you (the plaintiff), because you do not 
 say that you were ready to pay for it ; and if you were not ready, I 
 am not bound to deliver the corn ; " and the question is, whether that 
 should or should not have been alleged. The case decided by Lord 
 Holt in Salk. 112 [Callonel v. Briggs], if indeed so plain a case wanted 
 that authority to support it, shews that where two concurrent acts are 
 to be done, the party who sues the other for non-performance must 
 avei- that he had performed, or was ready to perform, his part of the 
 contract. Then the plaintiff in this case cannot impute to the defend- 
 ant the non-delivery of the corn, without alleging that he was ready 
 to pay the price of it. A plaintiff, who comes into a Court of Justice, 
 must shew that he is in a condition to maintain his action. But it has 
 been argued that the delivery of the corn was a condition precedent, 
 and some cases have been cited to prove it : but they do not appear to 
 me to be appHcable. In the one in Saunders [2 Saund. 250] the party 
 was to pull down a wall, and was then to be paid for it ; there is no 
 doubt but- that the pulling down of the wall was a condition prece- 
 dent to the payment ; the act was to be done, and then the price was to 
 be paid for it. So in the case in Salk. 171, where work was to be 
 done, and then the workman was to be paid. And in ordinary cases 
 of this kind the work is to be done before the wages are earned: 
 but those cases do not apply to the pi-esent, where both the acts are 
 to be done at the same time. Speaking of conditions precedent and 
 subsequent in other cases only leads to confusion. In the case of Camp- 
 bell V. Jones [6. T. R. 570] I thought, and still continue of that opin- 
 ion, that whether covenants be or be not independent of each other 
 must depend on the good sense of the case, and on 'the order in which 
 
 3 2 Arguments of counsel have been abridged and the concurring opinions 
 of Grose and Lawrence, JJ., omitted. 
 
518 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 the several things are to be done : but' here both things, the delivery 
 of the corn by one, and the payment by the other, were to be done at 
 the same time ; and as the plaintiff has not averred that he was ready 
 to pay for the corn, he cannot maintain this action against the defend- 
 ant for not delivering it. 
 Rule absolute.^^ 
 
 GOODISSON V. NUNN. 
 (In the Court of King's Bench, 1792. 4 Term E. 761.) 
 
 This was an action of debt to recover £21 on certain articles of 
 agreement, the substance of which was stated in the declaration. The 
 defendant craved oyer of the agreement by which the plaintiff agreed 
 that he would on or before the 2d of September then next, "by such 
 conveyances, surrenders, assurances, ways, and means in the law, 
 shall reasonably devise, advise, or require, well and sufficiently grant, 
 sell and release, assign and surrender, or otherwise convey to the de- 
 fendant all that copyhold tenement lying," &c. In consideration where- 
 of the defendant covenanted to pay to the plaintiff the sum of £210 
 on or before the 2d day of September next ensuing ; on failure of com- 
 plying with the before mehtioned agreement the defendant was to pay 
 to the plaintiff the sum of £21 ; and if the plaintiff did not deliver the 
 estate according to the before-mentioned agreement, then he was to 
 pay to the defendant the sum of £21. It was further agreed between 
 the parties, that the plaintiff should take up the copyhold as follows : 
 (that is to say) "That the plaintiff should take it up either for the de- 
 fendant or his wife, as they should agree ,at the time ; that the plain- 
 tiff should take it up for himself ; that each party should pay share 
 and share alike towards the expences attending the taking it up." The 
 defendant then pleaded, 1st, Non est factum; 2dly, That the plaintiff 
 did not on or before the 2d day of September next, &c., by such con- 
 veyances, assurances, surrenders, ways and means in the law rea- 
 
 33 Unless a contract for the sale of goods expressly sets the time of de- 
 livery and the time of payment, it is normally to be implied that they are to 
 be performed concurrently, and a tender of performance by one is a condition 
 precedent to the-duty of the other. Atkinson v. Smith, 14 M. & W. 695 (1845) ; 
 Dunham v. Pettee, 8 N. Y. 508 (1853) ; Long v. Addix, 184 Ala. 236, 63 South. 
 982 (1913) ; Bloxam v. Sanders, 4 B. & C. 941 (1825) ; Tipton v. Feitner, 20 
 N. Y. 428 (1859) ; Allen v. Hartfield, 76 111. 358 (1875) ; Hapgood v. Shaw. 
 105 Mass. 276 (1870) ; Isherwood v. Whitmbre, 11 M. & W. 347 (1843), the 
 goods must be tendered, so that they can be examined and identified ; Brown 
 V. Rushton, 223 Mass. 80, 111 N. B. 884 (1916 [cf. Prest v. Cole, 183 Mass. 
 283, 67 N. E. 246 (1903)]) ; Diem v. Koblitz, 49 Ohio St. 41, 29 N. E. 11^4, 
 34 Am. St. Kep. 531 T1892). 
 
 If a time is set for delivery earlier than the time set for payment the promise 
 to deliver is independent and the promise to pay Is dependent. Staunton v. 
 Wood, 16 Q. B. 638 (1851) ; Dey v. Dox, 9 Wend. (N. Y) 129, 24 Am. Dec. 
 162 (1832). 
 
Sec. 2) EAELY DEVELOPMENT 519 
 
 sopably devised, advised, and required, well and sufficiently grant, 
 sell, and release, assign and surrender, or otherwise convey to the de- 
 fendant the said premises in the said articles of agreement mentioned, 
 &c. 3dly, That the plaintiff did not on or before the 2d day of Sep- 
 tember, &c., or at any time since, well and sufficiently grant, sell, and 
 release, assign and surrender, or otherwise convey, to the defend- 
 ant, the said premises, &c. 4thly, That the plaintiff at the time of the 
 making of the articles, &c. had nothing in the said premises, where- 
 by he could be enabled to grant, &c., to the defendant the said prem- 
 ises, &c* 1 
 
 To the last three pleas the plaintiff demurred generally. 
 
 Lord Kenyon, C. J. This case is extremely clear, whether considered 
 on principles of strict law or of common justice. The plaintiff en- 
 gaged to sell an estate to the defendant, in consideration of which 
 the defendant undertook to pay £210; and, if he did not carry the 
 contract into execution, he was to pay £21 ; and now not having con- 
 veyed his estate, or offered to do so, or taken any one step towards it, 
 the plaintiff has brought this action for the penalty. Suppose the' 
 purchase-money of an estate was £40,000 it would be absurd to say 
 that the purchaser might enforce a conveyance without payment, and 
 compel the seller to have recourse to him, who perhaps might be an 
 insolvent person. The old case%, cited by the plaintiff's counsel, have 
 been accurately stated; but the determinations in them outrage com- 
 mon sense. I admit the principle on which they profess-to go : but 
 I think that the Judges misapplied that principle. It is admitted in 
 them all that where they are dependent covenants, no action will lie 
 by one party unless he have performed, or offered to perform his cov- 
 enant. Then the question is, Whether these are, or are not, depend- 
 ent covenants? I think they are; the one is to depend on the other; 
 when the one party conveyed his estate he was to receive the purchas- 
 money; and when the other parted with his money he was to have 
 the estate. They were reciprocal acts, to be performed by each other 
 at the same time. It seems, from the case in Strange [Blackwell v. 
 Nash, 1 Strange, 535], that the Judges were surprized at the old de- 
 cisions ; and in order to get rid of the difficulty, they said that a tender 
 and refusal would amount to a performance: it is true they went 
 farther, and said that "in consideration of the premises," meant only 
 in consideration of the covenant to transfer, and not in consideration 
 of the actual transferring of the stock : but to the latter part of that 
 judgment I cannot accede. It is our duty, when we see that principles 
 of law have been misapplied in any case, to over-rule it. The principle 
 is admitted in all the cases alluded to, that, if they be dependent cov- 
 enants, performance, or the offer to perform, must be pleaded on the 
 one part, in order to found the action against the other. The mistake 
 has been in the misapplication of that principle in the cases cited ; and 
 I am glad to find that the old cases have been over-ruled ; and that we 
 
520 IMPLIED AND CONSTRUCTIVE CONDITIONS PKECEDBNT (Gil. 4 
 
 are now warranted by precedent as well as by principle to say that this 
 action canot be maintained. 
 Judgment for the defendant.'* 
 
 SHERMAN V. LEVERET et al. 
 
 (Superior Court of i Connecticut, 1790. 1 Root, 169.) 
 
 Action declaring that the defendants^ on the 2nd of October, A. 
 D. 1786, made a written contract and bargain with the plaintiff, which 
 is in the words following, viz. October 2d, A. D. 1786, agreed that 
 David Leveret, Jr. and Co. give Peter Sherman il70 lawful money 
 for his store, land and barn, in Washington; half to be paid next 
 spring, in cash when Sherman is to quit, said store, and half the 
 spring after, in good neat, saleable cattle, with interest after next 
 spring until paid. Peter Sherman, David Leveret, Jr. and Co. — and 
 the plaintiif says that by said store, land and barn, mentioned in said 
 writings was meant the store then occupied by the plaintiff, arid a small 
 tract of land on which it stood and lay contiguous to it, and a small 
 bam standing thereon : and the plaintiff says that the defendants 
 entered upon said land sometime in April, A. D. 1787, in pursuance 
 of said written bargain and agreement, and improved the same, and 
 the plaintiff quitted said store upon th% request of the defendants, pur- 
 suant to said agreement, and fulfilled everything on his part to com- 
 plete and earry the same into execution ; but the defendants have 
 wholly neglected to fulfill said bargain and contract on their part, 
 and have never made said payments, promised in said agreement, 
 although often requested — Damage i200, dated 15th November, A. D. 
 1788. 
 
 Plea — Not guilty. Issue to the court — Judgment that the defend- 
 ants are not guilty. 
 
 LEVERET AND BELLAMY^. SHERMAN. 
 
 Action declaring that on the 2d of October, A. D. 1786, they pur- 
 chased of the defendant a piece of land, lying in Washington, con- 
 taining about three-quarters of an acre, together with a store and 
 barn thereon standing, and that the plaintiffs and the defendant did 
 enter into the following agreement, viz. Washington, October 2d, 
 1786, agreed that David Leveret, Jr. and Co. give to Peter Sherman 
 £170, lawful money, for his store, land and barn, in said Washington, 
 one-half to be paid next spring, in cash, when^said Sherman is to quit 
 said store and execute a warranty deed of the same to said Leveret 
 and Co. ' and half the spring following, in good neat cattle, on interest 
 from the first payment till paid ; and the plaintiffs say that the defend- 
 
 ^* BuUer and Grose, JJ., delivered concurring opinions. 
 See quotation from Willes, J., in the note to Nichols v. Raynbred, ante, p. 
 508. , : ■ . 
 
Sec. 2) EARLY DEVKLOPMENT 521 
 
 ant did not .quit said store nor execute a warranty deed to the plain- 
 tiffs in the spring succeeding October, A. D. 1786, according to said 
 agreement,; but continued in possession, of said premises, and utterly 
 refused to quit or convey the same tp the plaintiffs, whereby an ac- 
 tion has accrued to the plaintiffs to recover of the defendant their just 
 damages, which is ilOO, lawful money, writ dated 15th November, A. 
 D. 1788. Plea— Not guilty. Issue to the court. 
 
 Judgment — That the defendant is not guilty. 
 
 The two preceding, cases were heard and tried by the court together, 
 and upon the evidence, the court found that neither of the parties had 
 performed or made any tender of performing their parts of the agree- 
 ment. The question then came up, whether, as they were mutual cove- 
 nants, one was the consideration of the other; and so a performance 
 not necessary to be laid in the declaration, nor to be proved on the 
 trial. 
 
 The defendants, in the first action, insisted that the plaintiff, by 
 the stipulations in the agreement, was to do the first act, viz. was to 
 quit the store, etc. and to give a deed of the premises the then next 
 spring ; when, and not till that was done, did the duty of paying arise ; 
 but it was the opinion of the court, that by the terms of the contract ; 
 the quitting the store, etc., and giving a deed of the premises, the then 
 next spring, when half of the price was to be paid, were concurrent, 
 concomitant acts, to be performed by each of the parties at the same 
 time; and that neither had right to recover, without a performance 
 of his or their part of the agreement, or at least an offer to per- 
 form it 
 
 GREEN V. REYNOLDS. 
 
 (Supreme Court of New York, 1807. 2 Johns. 207.) 
 
 This was an action of covenant. By articles of agreement entered 
 into between the parties, the plaintiff, for the consideration therein 
 after-mentioned, covenanted to execute and deliver to the defendant 
 a good and sufficient deed for eighty-four acres of land, in Pittstown, 
 in the county of Rensselaer, on the first day of May, 1806. The de* 
 fendant, on his part, covenanted to pay tp the plaintiff, one thousand 
 dollars, on the first day of May, 1806, and the further sum of eight 
 hundred and seventy-five dollars, on the first day of May, 1812. The 
 declaration \yas for the non-payment of the one thousand dollars, but 
 did not aver that the plaintiff had tendered ai deed on the first day of 
 May, 1806. There was a general demurrer to the declaration, and 
 joinder in demurrer. 
 
 Allen, in support of the demurrer.^" 
 
 »= Allen here cited Jones v. Barkley, Doug. 689 (1781) ; Goodisson v. Nunn, 
 4 T. R. 761 (1792) ; Campbell v. Jones, 6 T. R. 570 (1796) ; Kingston v. 
 Preston, Doug. 688 (1773) ; Callonel v. Brlggs, 1 Salk. 113 (1705) ; Morton 
 V. Lamb, 7 T. R. 130 (1797). 
 
522 IMPLIED AND CONSTKUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 Kent, C. J. It has been decided in this court, in regard to a con- 
 tract for the dehvery of stock, that the delivery, and payment of the 
 money were dependent covenants, and that the plaintiff must aver a 
 performance, or an offer to perform, before he could bring his action. 
 
 Alien was stopped by the court, who desired to hear the other side. 
 
 Foot, contra. The principle laid down in the authorities cited by 
 the counsel, on the other side, apply to cases where the whole consid- 
 eration is to be paid, not where a part of the money is to be paid, on 
 the day the deed is to be delivered, and the residue afterwards. In the 
 present case, a part only of the money was to be paid, so that the cov- 
 enants are not mutual and dependent conditions, but each party has 
 his remedy without averring a performance. 
 
 Per Curiam. The covenants in this case- are clearly dependent.- 
 The one thousand dollars, being in part of the consideration for the 
 deed, and to be paid on the same day the deed was to be delivered, the 
 fair intent, and good sense of the contract is, that the money is not to 
 be paid, until the deed is ready for delivery. The declaration, there- 
 fore, is defective in not averring a tender of the deed by the plain- 
 tiff. We are of opinion, that the defendant is entitled to judgment; 
 but the plaintiff may amend his declaration on payment of the costs. 
 
 Judgment for the defendant.^" 
 
 NOYES V. BROWN et al. 
 (Supreme Court of Minnesota, 1919. 142 Minn. 211, 171 N. W. 803.) 
 
 Action by Williard L. Noyes against Edward Richard Brown and 
 others, with answer only by defendant Brown. Verdict directed for 
 defendant Brown and from an order denying his motion for a new 
 trial, plaintiff appeals. Order reversed. 
 
 Lees, C. This action was brought to recover all deferred payments 
 of the purchase price of 40 acres of land in Saskatchewan, Canada, 
 
 S8 1n accord: Glazebrook v. Woodrow, 8 T. R. 366 (1799); Mai'sden v. 
 Moore, 4 H. & N. 500 (1859) ; Kane v. Hood, 13 Pick. (Mass.) 28] (1832) ; 
 Beecher v. Conradt, 13 N. Y. 108, 64 Am. Dec. 535 (1855) ; Lemle v. Barry (Cal.) 
 183 Pac. 148 (1919) ; Gregory v.- Keenan (D. O.) 256 Fed. 949 (1919) ; Parker 
 V. Parmele, 20 Johns. (N. t.) 130, 11 Am. Dec. 253 (1822) ; Todd v. State Bank 
 of Bdgewood. 182 Iowa, 276, 165 N. W. 593, 3 A. L. K. 971 (1917),; Delaware 
 Trust. C!o. V. Calm, 195 N. "S:. 231, 88 N. E. 53 (1909). 
 
 Where a contract has been made for the sale of land, the continued exist- 
 ence of the buildings thereon is generally held not to be a condition precedent 
 to the buyer's duty to pay the price. Especially is this true if the time for 
 performance has arrived, or if the buyer has taken possession before the loss. 
 The rule is explained partly on the theory that in equity the buyer is the 
 owner, and res perit domino. See Paine v. Meller, 6 Ves. 349 (1801) ; Ames' 
 Cases on Equity, 227, citing many cases ; Sewell v. Underbill. 197 N. T. 168. 
 90 N. B. 430, 27 U R. A. (N. S.) 233, and note, 184 Am. St. Rep. 863, 18 Ann. 
 Cas. 795 (1910). The contrary rule is adopted in a few jurisdictions. Thomp- 
 son V. Gould, 20 Pick. (Mass.) 134 (1838) ; Wells v. Calnan, 107 Mass. 514; 
 9 Am. Rep. 65 (1871). See, also, post, SC2. 
 
Sec. 2) E^RLT DEVELOPMENT 523 
 
 sold to defendants by one Upton under a written contract thereafter 
 assigned to plaintiff. 
 
 The answer interposed by defendant Brown, upon whom alone the 
 summons was served, was a general denial. 
 
 There was a trial by jury and a directed verdict for defendant. 
 Plaintiff appeals from an order denying his motion for a new trial 
 Defendant has not appeared in this court, and the case has been sub- 
 mitted on the brief and oral argument of plaintiff's counsel. 
 
 The motion for a directed verdict was based on three grounds, 
 which may be stated as follows : That an action at law on a contract 
 for the sale of land to recover the purchase price will not lie; that 
 plaintiff failed to plead or prove that he had tendered a deed to de- 
 fendant or was able and willing to convey the land to him; and that 
 defendant was entitled to a deed from Upton, his immediate vendor, 
 who had disabled himself from conveying by transferring his interest 
 in the land to plaintiff. 
 
 Unaided by brief or argument by defendant's counsel, we have at- 
 tempted to discover a theory upon which the ruling of the trial court 
 might be sustained. 
 
 1. In Freeman v. Paulson, 107 Minn. 64, 119 N. W. 651, 131 Am. 
 St. Rep. 438, it was held that a vendor of land is not entitled to re- 
 cover the purchase price from his vendee in an ordinary action at law, 
 but is limited to a recovery of the damages he has sustained by rea- 
 son of the breach of the contract, if legal, as distinguished from eq- 
 uitable, relief is sought. 
 
 In that case, the vendee was to make an initial payment when the 
 contract was executed, and final payment Upon the delivery of the 
 deed. In the case at bar the contract provides for the payment of 
 $1,000 on the day of its execution and of $4,000 in four equal semi- 
 annual' installments. It recites that the times of such payments shall 
 be "a condition precedent and of the essence of this agreement" ; that 
 the vendee will "punctually pay the sums of money above specified as 
 each of the same becomes due"; that if he makes the payments as 
 stipulated then "upon request at_ the ofifice of the vendor * * * 
 at the city of Saskatoon, and the surrender of this agreement, [he] 
 shall be entitled to a conveyance of said land in fee simple" ; that if 
 he fails in the strict performance of his part of the agreement, the 
 vendor shall have the right to declare the contract null and void by 
 notice in writing to that effect, "but that no forfeiture shall take away 
 the right of the vendor to recover the purchase money" ; that the ven- 
 dee "accepts title of the vendor, and the said vendor, * * * or 
 assigns, as the case may be, shall not be bound to furnish any abstract 
 of title nor to produce any title deeds nor other evidence of title wha,t- 
 eyer, or to answer any requisition on title" ; and that the vendee, aft- 
 er the execution of the contract, shall have the right of possession of 
 the land. 
 
524 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 Appellant contends that these provisions distingtiish this cdntract 
 from the one considered in Freeman v. Paulson, supra. We are of 
 the opinion that this contention must be sustained. 
 
 In the Freeman Case final payment of the purchase price and the ex- 
 ecution of the deed were to be concurrent acts. Here payrrient of the 
 purchase price is expressly made a condition precedent to the right 
 of the vendee to a conveyance. In the ordinary contract for the sale 
 of land the vendee's covenant to pay and the vendor's to convey are 
 mutual and dependent, but here the covenant to pay is to be perform- 
 ed before the vendor's covenant to convey becomes operative. When 
 final payment is made, the vendee is to get his deed "upon request at 
 the office of the vendor" and the surrendei- of the contract. 
 
 In a contract to convey as soon as the vendor obtained title to the 
 land, this court held that "where, by the terms of a contract, the time 
 to perform the covenant on the one side is to happen * * * be- 
 fore the time for the performance of the covenant on the other side, 
 the former is not dependent on the latter." State v. Winona, etc., Co., 
 21 Minn. 472. * 
 
 Where the contract provided that the time for paying the consid- 
 eration was a date prior to that for the transfer of the property, it 
 held that the payment of the consideration was intended to be a con- 
 dition precedent to the obligation to transfer. RobSon v. Bohn, 27 
 Minn. 333-344, 7 N. W. 357. It has also held that "the question 
 whether covenants are to be held to be dependent on or independent 
 of each other turns upon the intention of the parties, to be ascer- 
 tained from the subject-matter and terms of their contract. Such in- 
 tention is paramount, to which, when once discovered, all technical 
 forms of expression must yield." Reynolds v. Lynch, 98 Minn. 58, 
 107 N. W. 145. 
 
 The doctrine of these three cases is fully supported by the decisions 
 of other courts. Early cases recognized nice and refined distinctions 
 in determining the character of covenants. The rule is now thorough- 
 ly settled that the intention of , the parties is the vital thing, that it is 
 to be ascertained from the sense of the entire contract rather than 
 from any particular form of expression, and that the order of time in 
 which it is intended that performance shall take place is a controlling 
 circumstance; Rules were formulated long ago in a note to Pordage 
 V. Cole, 1 Saund. 319 i. This is one of them: 
 
 "If a day be appointed for payment of money, or part of it 
 * * * and the day is to happen, or may happen, before the thing 
 which is the consideration of the, money * * * is to be per- 
 formed, an action may be brought for the money * * * before 
 performance: for it appears that the party relied upon his remedy, 
 and did not intend to make the performance a condition precedent ; 
 and so it is where no time is fixed for performance of that which is 
 the consideration of the money." ' 
 
 In Paine v. Brown, 37 N. Y. 228, this rule was cited with approval. 
 
Sec. 2) EARLY DEVELOPMENT 525 
 
 Following the lead of New York, the courts in many other states have 
 since given their approval to the rule. It is unnecessary to rehearse 
 the cases here. They are collected in 13 C. J. § 540. 
 
 The following language quoted from Collins v. Schmidt, 126 Wis. 
 227,. 105 N. W. 671, exactly fits the case at bar: "Under a contract 
 like this, where conveyance is only to be made upon demand after 
 completed payment, the promise of payment is absolute and may be 
 enforced by suit without tender of conveyance. The duty of the ven- 
 dor to convey is neither a condition precedent to payment nor an act 
 which may be demanded concurrently therewith." 
 
 2. The consideration which led to the adoption of the rule that an 
 action at law to recover the purchase price in an executory contract 
 for the sale of land will not lie was first stated in the early case of 
 Laird v. Pim, 7 M. & W. 474, as follows : "The question is : How 
 much worse off is the plaintiff by the diminution of the value of the 
 land, or the loss of the purchase money in consequence of the non- 
 performance of the contract ? It is clear that he cannot have the land 
 and its value, too." 
 
 We find this thought expressed in substantially the same language 
 in subsequent cases and by text-writers; ' Porter v. Travis, 40 Ind. 
 556; Prichard v. Mulhall, 127 Iowa, 545, 103 N. W. 774, 4 Ann. Cas. 
 789; Hogan v. Kyle, 7 Wash.-595, 35 Pac.,399, 38 Am. St. Rep. 910; 
 Bensinger v. Erhardt, 74 App. Div. 169, 77 N. Y. Supp. 577 ; 2 \\Aarv. 
 Vnd. § 937; 2 Suth. Dam. § 569. It would be manifestly unjust to 
 give the^ vendor the purchase money and allow him to keep the land. 
 If such were the result of permitting a recovery of the purchase price 
 we should hesitate to sanction a recovery. The situation which has 
 troubled the courts and which is presented in this case may be thus 
 stated : 
 
 A vendor whose contract entitles him to receive the purchase price 
 before he can be called upon to convey, or who is to have a reasonable 
 time after he gets his money within which to convey, cannot logically 
 be denied the right to sue for and recover the purchase price after it 
 falls due; but, if he may get judgment and collect it before convey- 
 ing, a vendee whose contract is not recorded and who is not in pos- 
 session may be deprived of the land through a wrongful conveyance 
 to another, or through judgments against the vendor, and, if his ven- 
 dor is contumacious, he may be put to the expense of a suit in equity 
 to get title to the land after paying for it. The situation has been met 
 in various ways by different courts. Some have cast logic aside, and 
 while permitting a recovery of all but the last installment of the pur- 
 chase price, have refused to allow it to be recovered in an action at 
 law, no matter how trifling it may be. The rule adopted in these cases 
 is that the vendor may sue for each installment as it falls due, except 
 the last. If he waits until all the installments are due, and then sues 
 for the whole obligation, or, having been paid all but the last install- 
 ment, ,he sues for that, he must first tender a deed, and cannot recover 
 
526 IMPLIED AND CONSTRUCTIVE CONDITIONS PEECEDENT (Ch. 4 
 
 in the absence of such, tender. Biddle v. Coryell, 18 N. J. Law, 377 ; 
 38 Am. Dec. 521 ; Robinson v. Harbour, 42 Miss. 795, 97 Am. Dec. 
 501, 2 Am. Rep. 671 ; First Nat. Bank v. Agnew, 45 Wis. 131 ; Boone 
 V. Templeman, 158 Cal. 290, 110 Pac. 947, 139 Am- St. Rep. 126. 
 
 Another line of cases holds that there may be a money judgment 
 for the entire purchase price, but that its enforcement will be stayed 
 until the vendor deposits in court a deed, to be delivered to the vendee 
 upon payment of the judgment. There is little practical difference 
 between a judgment with execution stayed until a vendor deposits a 
 deed and a judgment for the purchase money at the end of a suit 
 for specific performance. The right to the latter remedy is well estab- 
 lished. Freeman v. Paulson, supra; O. W. Kerr Co. v. Nygren, 114 
 Minn. 2^, 130 N. W. 1112, Ann. Cas. 1912C, 538. 
 
 The former course of procedure has been termed an "irregular ex- 
 pedient to give a judgment at law the effect of specific performance, 
 * * * of doubtful propriety in jurisdictions where * * * the 
 distinction between actions at law and in equity is still preserved." 
 Prichard v. Mulhall, supra. The expedient may be irregular, but its 
 adoption is sanctioned in cases entitled to the highest consideration. 
 Loud V. Pomona Co., 153 U. S. 564, 14 Sup. Ct. 928, 38 L. Ed, 822; 
 Rindge v. Baiter, 57 N. Y. 209-224, 15 Am. Rep. 475. The following 
 statement is found in Freeman on Executions, § 32, and appears to 
 be well fortified by numerous decisions : 
 
 "The power of courts to temporarily stay the issuing of execution 
 is exercised in an almost infinite variety of circumstances, in order 
 that the ends of justice may be accomplished. In many cases this 
 power operates almost as a substitute for proceedings in equity, and en- 
 ables the defendant to prevent any inequitable use of the judgment or 
 writ" — citing among other cases Blair v. Hilgedick, 45 Minn. 23, 47 N. 
 W. 310. 
 
 See, also, Richardson v. Merritt, 74 Minn. 354, 77 N. W. 234, 407, 
 968, and Eaton v. Cleveland, etc., Ry. Co. (C. C.) 41 Fed. 421. 
 
 Our conclusion is that if a vendor in such an action as is now be- 
 fore us, obtains judgment for the purchase price, it is the duty of the 
 trial court to stay execution thereon until the deed is deposited with 
 the clerk of court, to be delivered to the vendee on payment of the 
 judgment, and that, the stay should be continued long enough to give 
 the vendee a reasonable opportunity to ascertain whether the deed con- 
 veys the title in compliance with the terms of the contract. The views 
 expressed in Knoblauch v. Foglesong, 37 Minn. 320, 33 N. W. 865, 
 point to the conclusion we have reached on this phase of the case. 
 
 3. The complaint does not plead a tender of a deed, or ability and 
 willingness on the part of the vendor to convey. 
 
 It would seem that such allegations have no place in an action to 
 recover the purchase price when the covenant to pay it is independent 
 of the covenant to convey. 
 
Sec. 2) EARLY DEVELOPMENT ■ 527 
 
 _ Lewis V. Prendergast, 39 Minn. 301, 39 N. W. 802, one of the first 
 cases to refer to the necessity of pleading an offer to perform, was a 
 case where the covenants were held to be concurrent and dependent. 
 That was an action for specific performance. In Blunt v. Egeland, 
 104 Minn. 351, 116 N. W. 653, an action for damages for breach of a 
 contract for the sale of land, it was said by the present Chief Justice 
 that, "generally speaking, where the stipulations of the contract are 
 concurrent and dependent, a tender of performance before suit is nec- 
 essary, * * * jmjj jn those cases where the time of performance 
 is past an allegation of the failure and refusal by defendant to per- 
 form, the first act of performance being by the terms of the contract 
 cast upon him, sufficiently states a right of action." 
 
 The language quoted precisely fits the case at bar, and the rule there 
 laid down dispenses with necessity of pleading an offer to perform 
 in such a case as we have here. The same rule was laid down in Gale 
 v. Best, 20 Wis. 48, and in Shenners v. Pritchard, 104 Wis. 287, 80 
 N. W. 458. 
 
 There is nothing inconsistent in Freeman v. Paulson, supra. Had 
 the contract in that case been similar in its terms to the contract now 
 in question, the practice we have sanctioned here would have been 
 applicable. 
 
 4. The provisions of the contract relating to the title defendant was 
 to receive have been sufficiently pointed out. They do not entitle him 
 to a deed with personal covenants by his vendor. If he receives a con- 
 veyance of title in fee, he will get all that the contract provides for. 
 Such title may come from his vendor's assignee, or from any other 
 source, provided it conveys the fee to him. The case does not fall 
 within the rule stated in McNamara v. Pengilly, 64 Minn. 543, 67 » 
 N. W. 661, but is governed by Meyers v. Markham, 90 Minn. 230, 96 
 N. W. 335, 787, and McManus v. Blackmarr, 47 Minn. 331, 50 N. W. 
 230. 
 
 Order reversed. 
 
 McRAVEN V. CRISLER. 
 
 (Supreme Court of Mississippi, 1876. 53 Miss. 542.) 
 
 ChalmBrs, J.^^ * * * By the defendant's sixth plea she averred 
 "that the original note was given by her in consideration that the plain- 
 tiff would sell and convey to her by proper deed of conveyance the 
 land," &c. ; and that no de;ed had been tendered before suit brought. 
 A deed was filed with the declaration, which, by the judgment of the 
 court, was ordered to remain on file, and be delivered on payment of 
 the judgment. Was there any obligation to tender it before the insti- 
 tution of the suit? There was no written contract to convey the land, 
 
 ^' The statement of facts and a part of the opinion have been omitted. 
 
528 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 nor any proof of a parol promise to do so. The question must there- 
 fore be tested by the averments of the 'plea. 
 
 It will be observed that there is no alleg'ation that the deed was to 
 be made at or before 'the payment of the note, nor is any time specified 
 when the execution of the deed was to take place. The note was pay- 
 able one day after date. While it is true that the courts will hold 
 the covenant to pay and the covenant to make title as dependent, unless 
 a contrary intention clearly appears, it is no less true that the covenants 
 must be regarded as independent, where the time of payment preceded 
 the time fixed for delivering the deed, or where no time for making title 
 is specified.^ Gibson v. Newman, 1 How. 341 ; Leftwich v. Coleman, 3 
 How. 167 ; Rector v. Price, 3 How. 321 ; Robinson v. Harbour, 42 
 Miss. 79'5, 97 Am. Dec. 501, 2 Am. Rep. 671. 
 
 The case of Gibson v. Newman, supra, was much like the one at 
 bar. In that case, as in this, there was no written obligation to convey, 
 and the question was determined by the language of the plea. There, 
 as here, the plea failed to aver any period when the deed was to be 
 made ; and upon this ground the covenants were held to be independent. 
 That case is cited and approved in Robinson v. Harbour, ubi supra, 
 the latest authoritative exposition of this court on the much-vexed 
 question of dependent and independent covenants. 
 
 The demurrer to the plea in the case at bar was properly sustained. 
 
 Judgment affirmed! 
 
 NORTHRUP V. NORTHRUP. 
 (Supreme Court of New "Sforl^ 1826. 6 Cow. 296.) 
 
 On demurrer to the defendant's plea. The plaintiff -declared on a 
 covenant, which, on oyer, was as follows: The defendant covenanted 
 to pay a certain rent due and in arrear, to one D. Tomlinson, on a 
 certain farm, and all which should become due on the 2Sth of March, 
 1825 ; the whole to be paid on that day ; and the plaintiff covenanted, 
 that on the defendant's so paying the rent, he, the plaintiff, would give 
 up and discharge a certain bond and mortgage. The action was for not 
 paying the rent at the day. 
 
 Plea, that the plaintiff did not, on the 25th day of March, 1824', 
 give up and discharge the bond and mortgage, nor tender, nor offer 
 to do so, on that day, or before or since. 
 
 General demurrer and joinder. 
 
 Curia per Savage, C. J. The plea is bad. The payment of the 
 money to Tomlinson, on the day specified, is clearly a condition 
 precedent. The performance by the plaintiff of his part of the agree- 
 ment is not necessarily simultaneous; but was naturally to be subse- 
 quent. A general averment of his readiness to perform, is all that can 
 be necessary or proper. To aver a tender was certainly not neces- 
 sary. ' '■ ' ' ' ''''' 
 
Sec. 2) EARLY DEVELOPMENT ■ 529 
 
 I/5rd Mansfield, in Jones v. Barkley, Doug. 690, makes three classes 
 of covenants; 1. Such as are mutual and independent, wh^re sepa- 
 rate actions lie for breaches on either side; 2. Covenants which are 
 conditions, and dependent on each other, in which the performance 
 of one depends on the prior performance of the other ; 3. Covenants 
 which are mutual conditions to be performed at the same time; as 
 to which the party who would maintain an action must, in general, offer 
 or tender performance. I consider the plaintiff's covenant as clearly 
 belonging to the second class. The defendant's covenant was absolute. 
 The cases cited by the defendant's counsel relate to the third class. 
 
 The plaintiff must have judgment, with leave to the defendant to 
 amend on payment of costs. 
 
 Judgment for the plaintiff,^* 
 
 INTERNATIONAL TEXT-BOOK CO. v. MARTIN. 
 (Supreme Judicial Court of Massachusetts, 1915. 221 Mass. 1, 108 N. E. 469.) 
 
 Action by the International Text-Book Company against Charles D. 
 Martin, to recover the balance due on a written contract between plain- 
 tiff and defendant's minor son, which contract the defendant had guar- 
 anteed in writing. Verdict directed for the plaintiff, and defendant 
 excepts. Exceptions overruled. 
 
 LoRiNG, J.^* By the written agreement between the plaintiff and the 
 defendant's son, the son subscribed "for a scholarship in the Interna- 
 tional Correspondence- Schools, covering a course of correspondence 
 instruction in telephone engineering," and he promised to "pay for said 
 scholarship the sum of" $78.40, in installments of $5 pach, the first in- 
 stallment to be paid at the time of signing the subscription and the re- 
 maining installments "within each and every period of four weeks 
 hereafter until said price is ,paid in full." It was further agreed that 
 in case of default in the payment of any one of said installments when 
 due and payable the whole of the amount remaining unpaid should 
 thereupon at the option of the plaintiff become due and payable. The 
 contract contained these further provisions : 
 
 "It is agreed as follows : First : That the price hereinafter agreed 
 to be paid for said scholarship shall include : (a) All chargp for instruc- 
 tion in all subjects of the course for which said scholarship calls until 
 I am qualified to receive a diploma or certificate of proficiency, pro- 
 vided I complete said course within five years from the date hereof. 
 * * * Fourth : That this subscription, when accepted by you, shall 
 not be subject to cancellation, and that you shall not be required to re- 
 fund any part of the money paid for said scholarship." 
 
 sfln accord: Morris v. Sllter, 1 t)enio (N. Y.) 59 (1845), plaintiff 
 covenanted to convey "after defendant shall have paid." 
 3 'That part of the opinion dealing with the second defense is omitted. 
 
 CORBIN CONT Si 
 
530 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 In addition to the foregoing the following words were printed at 
 the bottom of the contract : "We do not refund money paid for schol- 
 arship." 
 
 The defendant guaranteed "the payment to you [the plaintiff] of 
 the price agreed to be paid for the within-mentioned scholarship in 
 accordance with the terms of the within subscription." Both contracts 
 were dated August 22, 1910. 
 
 The son pursued his studies under the plaintiff's instruction for some 
 four months and paid four installments in addition to that paid when 
 the contract was signed. He then (on or about January 1, 1911) stop- 
 ped studying and refused to make any further payments. This action 
 on the guaranty was brought on January 5, 1912, to recover the un- 
 paid installments amounting to $53.40. 
 
 The defendant admitted that he signed the contract and that he 
 read it before he signed it. That included the plaintiff's contract with 
 the son, which by the terms of the contract of guaranty was incorpo- 
 rated into the guaranty contract. Two defenses were set up: First, 
 that on or about January 1, 1911, when he was not in default in the pay- 
 ment of the installments due from him, the son elected not to go on with 
 the instructions called for by the contract; and, second, that certain 
 misrepresentations were made by the agent of the plaintiff when the 
 contract was signed by the son. 
 
 The first defense is in effect based on the assumption that the contract 
 sued on was a contract to pay $5 a month for instructions to be given 
 to the son by the plaintiff until the sum of $78.40 had been paid, or, if 
 that contention be not sound, that under the circumstances we have 
 stated the plaintiff is not entitled to recover the contract price but is en- 
 titled to recover damages only for breach of the contract by the son. 
 The latter defense is stated in the fourth and fifth rulings asked for by 
 the defendant, and set forth in the note.*" 
 
 It is plain that the contract is not a contract for instruction by the 
 month, to be paid for and furnished until $78.4Q should have been 
 paid. By the terms of the contract between the son and the plaintiff, 
 the son subscribed "for a scholarship in the International Correspond- 
 ence Schools covering a course of correspondence instruction in tele- 
 phone engineering" to be given until he was qualified to receive a 
 diploma or certificate of proficiency, provided he completed the course 
 
 *" "4. Although the performance of the contract on the part of the plaintiff 
 was prevented by the refusal to perform on the part of Walter G. Martin, sub- 
 scriber, yet the plaintiff is not entitled to the entire contract price less the 
 amount paid, but only to the amount of damages caused by the breach of con- 
 tract on the part of the subscriber, Walter G. Martin. 
 
 "5. By the terms of the written agreement, the plaintiff had to make ex- 
 penditures for stamps, typewriting, corrections on papers, etc. The facts as 
 to these expenditures are especially within the knowledge of the plaintiff, but 
 as the plaintiff has not offered the necessary evidence to show what these 
 expenses will amount to, it will be impossible for you to fix the damages and 
 therefore you will find for the defendant." 
 
Sec. 2) EARLY DEVELOPMENT 531 
 
 within five years from the date of the agreement. That is to say, 
 the son had five years in which to complete the course and the plain- 
 tiflf was bound to carry on the instruction agreed to be given for that 
 period, or until the son should be qualified to receive a diploma within 
 that period. The payments to be made by the son were to be made in 
 16 installments (IS of which were for the sum of $5 each and the 
 sixteenth for the sum of $3.40), and these installments were to be paid 
 every four weeks, beginning with the date of the signing of the con- 
 tract. ' The case comes within -the first rule of Sergeant Williams in 
 his note to Pordage v. Gole, 1 Saunders, 319, 320. That rule is in these 
 words : 
 
 "If a day be appointed for payment of money, or part of it, o^for 
 doing any other act, and the day is to happen, or may happen, before 
 the thing which is the consideration of the money, or other act, is to 
 be performed, an action may be brought for the money, or for not doing 
 such other act before performance ; for it appears that the party relied 
 upon his remedy, and did not intend to make the performance a condi- 
 tion precedent." 
 
 This again was founded upon the judgment of Chief Justice Holt 
 in Thorp v. Thorp, 12 Mod. 455, 461. In other words the promise 
 contained in this contract which the plaintiff now seeks to enforce was 
 an independent, not a dependent, promise. 
 
 In case of independent promises the promisor has to -perform his 
 promise and if he does not get what he pays for his remedy is by a 
 cross-action. In the case at bar the plaintiff has been ready and willing 
 at all times to go on with the son's instruction, but the son has re- 
 fused to study. The' plaintiff has not been guilty of any breach of its 
 agreement. Under these circumstances the defendant's contention 
 comes to this : The maker of an independent promise who renounces his 
 right to the thing paid for by him can show that fact in reduction of 
 the sum the promisee is entitled to recover under the independent 
 promise. The case of International Text-Book Co. v. Martin, 82 Neb. 
 403, 117 N. W. 994, seems in effect to be a decision that there is such 
 a right to f educe the amount to be recovered in such a case. It was 
 there held that the burden was on the' defendant to prove the benefit 
 ensuing to the plaintiff by tlie defendant's renunciation, and in the ab- 
 sence of proof of such a benefit that the sum stipulated for had to be 
 paid. 
 
 If that be so ordinarily, or if ordinarily there is a question as to that, 
 it is disposed of in the case at bar by the terms of the contract between 
 the plaintiff and the son, which was guaranteed by the defendant and 
 by reference made part of the contract of guaranty. It is there ex- 
 pressly provided that : "This subscription, when accepted by you [the 
 plaintiff], shall not be subject to cancellation, and that you will not be 
 required to refund any part of the money paid for said scholarship," 
 and "We [the plaintiff] do not refund money paid for scholarship." 
 
532 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 The direct effect of these two provisions is confined to the return of 
 money paid by the scholar. But indirectly they affect the construction 
 of the contract. If money paid for the "scholarship" is not to be re- 
 turned under any circumstances, it is plain that as matter of construc- 
 tion the contract between the plaintiff and the son was a contract by 
 which the son bought a ''scholarship," that is to say a right to be in- 
 structed in telephone engineering for a period of five years or until 
 he became qualified to receive a diploma before the expiration of that 
 time. He was not bound to study at all if he did not wish to. On the 
 other hand although he was at liberty to study when he wished at any 
 time during the five years, he was bound to pay for the "scholarship" in 
 in^llments the last of which came due in one year and three months 
 after the signing of the contract. What he paid for was the right to 
 the instruction, and the suin to be paid for that right was to be paid 
 whether the son did or did not exercise his right to be instructed. 
 
 The defendant has placed great reliance on International Text-Book 
 Co. V. Schulte, 151 Mlich. 149, 151, 114 N. W. 1031; International 
 Text-Book Co. v. Jones, 166 Mich. 86, 88, 131 N. W. 98, 99; Interna- 
 tional Text-Book Co. v. Marvin, 1.66 Mich. 660, 668, 132 N. W. 
 437; International Text-Book Co. v. Roberts, 168 Mich. 501, 506, 134 
 N. W. 460. The doctrine established by the first two of these cases 
 arid recognized by the other two is stated in these words in the second 
 case : "It is the rule in this state that a party to an executory con- 
 tract may always stop performance by the other party by an explicit 
 direction or renunciation of the contract, and refusal to perform fur- 
 ther on his part, and that he is thereafter liable only upon the breach 
 of the contract. The contract price is recoverable only upon the 
 theory of performance, never upon the theory of inability to per- 
 form" brought on by the refusal of either party to go on. 
 
 It was accordingly held in the first two cases that the only sum 
 which could be recovered was the damage proved by the plaintiff; 
 and there being no affirmative proof of damages suffered by the plain- 
 tiff in those cases it was held that the plaintiffs were entitled to nominal 
 damages only. That doubtless is the rule in case of dependent prom- 
 ises. For exainple where A. agrees to buy of B. a chattel and to pay 
 a specified sum for it. If A. refuses to go on with the contract before 
 the title to the chattel passes all that B. can recover is damages. See 
 for example Barrie v. Quimby, 206 Mass. 259, 92 N. E. 451. But 
 see in this connection White v. Solomon, 164 Mass. 516, 42 N. E. 
 104, 30 L. R. A. 537; National Cash Register Co. v. Dehn, 139 Mich. 
 406, 102 N. W. 965, where it was held that even in case of sales of 
 chattels the rule does not apply in case it is agreed that payment 
 is to be made before the title passes. The, case at bar does not come 
 within the rule stated in the Michigan cases because in the contract 
 here in question the promise to pay was an independent promise. 
 
 For these i-easons we are of opinion that the exception^ taken' to the 
 refusal to' give' the fourth and fifth rulings asked for must be over- 
 
Sec. 2) PARTIAL FAILURE OF TEEFORMANCE 533 
 
 ruled. This conclusion was reached in International Text-Book Co. 
 V. Anderson, 179 Mo. App. 631, 162 S. W. 641. * * * 
 Exceptions overruled.*^ 
 
 (b) Partial Failure of Performance 
 BOONE V. EYRE. 
 
 (In the King's Bench, 1777. 1 H. Bl. 273, no'!e.) 
 
 Covenant on a deed, 'whereby the plaintiff conveyed to the defend- 
 ant the equity of redemption of a plantation in the West Indies, 
 together with the stock of the negrdes upon i't, in consideration of 
 £500 and ah annuity of il60 per annum for his life; and covenanted 
 that he had a good title to^the plantation, was lawfully possessed of 
 the negroes, and that the defendant should quietly enjoy. The de- 
 fendant covenanted, that the plaintiff well, and truly performirfg all 
 and everything therein contained on his part to be performed, he 
 the defendant would pay the annuity. The breach assigned was the 
 non-payment of the annuity. Plea, that the plaintiff was not, at the 
 time of making thfe deed, legally possessed of the negroes on the 
 plantation and so had not a good title to convey. 
 
 To which there was a general' demurrer. 
 
 Lord Mansfield. The distinction is very clear, where mutual cove- 
 nants go to the whole of the consideration on both sides, they are 
 mutual conditions, the one precedent to the other. But where they go 
 only to a part, where a breach may be paid for in damages, there the 
 defendant has a remedy on his covenant, arid shall not plead it as 
 a condition precedent. If this plea were to be allowed, any one negro 
 not being the property of the plaintiff would bar the action. 
 
 Judgment for the plaintiff.*^ 
 
 *i In' accord : Massachusetts Biographical Soc. v. Russell, 229 Mass. 524, 118 
 N. E. 662 (1918) ; La Salle Extension tjniverslty v. Ogburn, 174 N. C. 427, 
 93 S. E. 986. Ann. Gas. 1918C, 887 (1917) ; International Correspondence 
 Schools V. Ayres, 106 L. T. 845 (1912) ; International Correspondence 
 Schools V. Irving (Ct. Sess. Scot.) S. C. 28 (1915). Cf. International Test- 
 Book Co. r. JTones, 166 Mich. 86, 131 N. W. 98 (1911) ; and Clark v. Marsiglia 
 1 Denio (N. Y.) 317. 43 Am. Dec. 670 (1845) ; Wigent v. Marrs, 130 Mich. 609, 
 90 N. W. 423 (1902). 
 
 ^'^ See in general accord: Campbell y. Jones, 6 T. R. 570 (1796), sale of 
 patent with promise to teach; Ritchie v. Atkinson, 10 East, 295 (1808), freight 
 pro rata allowed after delivery of half a load ; Havelock v. Geddes, 30 East, 
 555 (1809), charter party, delay; Davidson v. Gwynne, 12 East, 381 (1810) 
 same; Fothergill v. Walton, 8 Taunton, 576 (1818) ; Carpenter v. Cresswell, 4 
 Bing. 409 (1827), sale of business with covenant not to interfere ; Franklin v. 
 Miller, 4 Adol. & El. 599 (1836) ; Stavers v. Curling, 3 Bing. N. 0.'3o5 (1836), 
 wages due in spite of some breaches of duty; Seogfr v, Duthie, 29 li. J.C. P. 
 253, 30 ib. 65 (1860) ; White v. Beeton, 7 H. & N. -VJ (ISf.l) ;■ Pust v. Dowie, 
 32 L. J. Q. B. 179, 34 L. J. Q, B. 127 (1865) ; Deep Vein Coal Go. v. Jones, 
 
534 IMPLIED AND CONSTRUCTIVE CONDITIONS PEECEDENT (Ch. 4 
 
 PICKENS V. BOZEI.I.. 
 (Supreme Court of Indiana, 1858. 11 Ind. 275.) 
 
 Davison, J.*' Bozell brought this action against Pickens, upon a 
 written agreement, which bears date October 6, 1854, and is as 
 follows : 
 
 "This agreement made, &c., between Joseph Bozell and Henry 
 Pickens, witnesseth: That Bozell has leased, and by these presents 
 doth lease, to said Pickens, for the term of two years from the first 
 of March, 185^, twenty-five acres of upland, and forty acres of bottom 
 land, described, &c. ; and is to furnish house and garden, pasture 
 for one cow, and firewood off the place; and is to put the farm in 
 good repair. Pickens is to farm the land as follows: The upland 
 is to be put in oats, and . he is to pay Bozell one-third of the same 
 in the shock. The bottom land, he, Pickens, is to farm in corn, and 
 pay Bozell twenty-two ' and one-half buHiels of corn per acre, to 
 be delivered on the premises. Pickens is to have all the pasture of 
 the com ground, and two-thirds of the pasture of the oats ground," &c. 
 
 In the complaint, it is averred that the defendant failed to deliver to 
 the plaintiff, on the premises or elsewhere, any of said rent corn 
 for the year 1856, except six hundred and twenty bushels — leaving 
 unpaid and undelivered two hundred and eighty bushels, which was, 
 at the time the same should have been delivered on the premises, 
 worth forty cents per bushel — wherefore, &c. 
 
 Defendant demurred to the complaint, but his demurrer was over- 
 ruled, and thereupon he answered by a general denial, and also by 
 way of counterclaim. * * * 
 
 Verdict in favor of the plaintiff for $10.58, upon which the Court 
 rendered judgment, &c. 
 
 The only point made in the argument of the cause relates to the 
 action of the Court in overruling the demurrer to the complaint. 
 That pleading is said to be defective because it fails to allege the 
 performance of certain stipulations which the plaintiff agreed he 
 would perform, namely, that he would "furnish the defendant a 
 house and garden, and pasture for one cow, and put the farm in 
 good repair." This construction does not seem to be correct. In 
 the agreement before us, the promises are evidently mutual. Those 
 of which the plaintiff has failed to allege performance, constitute 
 only a part of the consideration of the defendant's contract; and 
 where, in such case, he has actually received a partial benefit from the 
 
 49 Ind. App. 314, 97 N. E. 341 (1912) ; ,Statesville Flour Mills Co. v. Wayne 
 Distributing Co., 171 N. C. 708, 88 S. E. 771 (1916). 
 
 See discussion in Grant v. Johnson, 5 N. Y. 247 (1851) ; and cf. Glazebrook 
 V. Woodrow, 8 T. R. 366 (1799) ; Kane v. Hood, 13 Pick. (Mass.) 281 (1832) ; 
 Ellen V. Topp, 6 Ex. 424, 155 Eng. Rep. 609 (1851) ; Cadwell v. Blake, 6 Gray 
 (Mass.) 402 (1856). 
 
 *° Part of the opinion is omitted. 
 
Sec. 2) PARTIAL FAILURE OF PERFORMANCE 535 
 
 consideration of the engagement on his part, and the plaintifif's fail- 
 ure to perform may be compensated in damages, the stipulations of 
 the parties will be construed independently; and the result is, that 
 an action for a breach may be maintained against the defendant with- 
 out alleging performance. 1 Chit. PI. 323,a; Pordage v. Cole, 1 
 Saund. 320,b; Bennet v. Executors of Pixley, 7 Johns. (N. Y.) 249; 
 Tompkins v. Elliot, 5 Wend. (N. Y.) 496; Obermyer v. Nichols, 6 Bin. 
 (Pa.) 159, 6 Am. Dec. 439; Bream v. Marsh, 4 Leigh (Va.) 21; 
 Gourdin v. Davis, 2 McCord (S. C.) 514. And this doctrine is plainly 
 consistent with the new rules of pleading; because, under them, the 
 defendant may, in every such case, set up in his defense, by way of 
 counterclaim, the plaintiff's failure to perform, in reduction of dam- 
 ages. 2 R. S. 1852, p. 41, § 59. True, where the mutual promises 
 go to the whole consideration on both sides, performance must be 
 averred; but in the case at bar, the main consideration of the de- 
 fendant's stipulation to pay rent, was not the furnishing of the house, 
 &c., but the use and occupation of the leased premises for a stated 
 term. The record, in this instance, suiificiently shows that he took pos- 
 session, and occupied under the lease; hence, it would be unequal 
 and unjust to hold that the plaintiff cannot sue for the rent without 
 alleging performance. Bryan v. Fisher, 3 Blackf. 316. 
 
 Per Curiam. The judgment is affirmed, with 10 per cent, damages 
 and costff.^* 
 
 ** In Oscar Barnett Foundry Co. v. Crowe, 219 Fed. 450, 135 C. C. A. 162 
 (1915), a breach by the plaintiff, for which judgment had been obtained 
 against him, was held not to privilege the defendant not to perform his part. 
 The court said: "These questions are controlled by the principle of law 
 that a breach of a covenant, which goes to the whole consideration of a con- 
 tract, gives to the injured party the right to rescind the contract or to recover 
 damages for the breach ; or, stated conversely a breach of a covenant, which 
 does not go to the whole consideration of a contract, but which is subordinate 
 and incidental to its main purpose, does not constitute a breach of the entire 
 contract or warrant its rescission by the injured party. Kauffman v. Raeder, 
 108 Fed. 172, 47 C. C. A, 278, .54 L. R. A. 247 (1901) ; Howe v. Howe & Owen 
 Ball Bearing Co., 154 Fed. 820, 83 C. C. A. 536 (1007) ; Neenan v. Otis Eleva- 
 tor Co. (C. C.) 180 Fed. 997, 1000 (1910). While every breach of a contractual 
 obligation confers a right of action upon the injured party, it is thus seen 
 that every breach does not operate as a discharge. A breach which permits 
 a rescission of the contract, discharging the other party, must be of an abso- 
 lute part of the obligation — that is, a breach of that part of the obligation 
 which goes to the whole consideration, and may be made, first, when the party 
 renounces his liabilities under it ; second, when by his own act he makes it 
 impossible to perform ; or, third, by failing fully to do what he promised. 
 When this occurs, the party offended against may consider the contract 
 rescinded and himself exonerated, or sue upon the contract for such damages 
 as he has thereby sustained." See, also, Krebs Hop Co. v. Livesley, 51 Or. 
 527, 92 Pac. 1084 (1908). 
 
 In McAUister-Coman Co. v. Matthews, 167 Ala. 361, 52 South. 416, 140 Am. 
 St. Rep. 43 (1910), the court said: "Every breach of a contract is, of course, 
 inconsistent with the contract; but every breach by one party does not au- 
 thorize the other to renounce it in toto." 
 
[)3B IMPLIED AND CONSTRUCTIVE CONDITIONS PRKCBDENT (Ch. 4 
 
 TICHNOR BROS. v. EVANS. 
 
 (Supreme Court of Vermont, 1918. 92 Vt. 278, 102 Atl. 1031, L. K. A. 
 
 19180, 1025.) 
 
 Assumpsit by Tichnor Bros; against Joseph Evans, with plea of gen- 
 eral issue. Judgment for plaintiffs on facts found by the court, and de- 
 fendant excepts. Affirmed. 
 
 PowBRS, J. In the spring of 1914, the plaintiffs, through their travel- 
 ing salesman, Pierce, sold the defendant a bill of goods which included 
 the post card sets here in controversy. At the time of the sale, Pierce 
 told the defendant that if he would buy the sets at the price named, he 
 (Pierce) would not sell like sets to any one else in the town. Upon 
 this assurance, the defendant made the purchase. The plaintiffs did not 
 keep this agreement, but at some time during the folloWing winter they 
 sold, similar sets to one of the defendant's competitors doing business on 
 the same street. The defendant learned of this about the 1st of June, 
 1915. but said or did nothing about ituntil some two years later and 
 just before the trial below. The suit is brought -to recover the balance 
 due on the goods sold, and is defended on the ground that the plain- 
 tiffs, having broken the contract in the particular named, are not en- 
 titled to recover anything under it. 
 
 The trial below was by the court, and it is recited in the findings that 
 there was no evidence from which a deterjnination could be made as to 
 the amount of damage the defendant had suffered!' by, reason of the 
 above-mentioned breach of the contract by the plaintiffs. Therefore 
 the court assessed such damage at $1, deducted it from the amovint due 
 the plaintiffs, and rendered judgment for the latter for the balance, 
 with interest thereon. To this the defendant excepted. So the only 
 question before us is, Were the plaintiffs entitled to recover anything on 
 the facts found? 
 
 The defense is predicated upon the doctrine, frequently approved by 
 this court, that a breach that goes to the essence oi the contract operates 
 as a discharge of it. This rule will not avail the defendant. It is not 
 every breach that goes to the essence. It gives rise to an action for 
 damages, but it does not necessarily justify a refusal to perform. 
 Where, as here, the stipulation goes only to a part of the consideration, 
 and may be compensated for in damages, its breach does not relieve the 
 other party from performance. In such cases, the broken promise is 
 an independent undertaking and not a condition precedent. Kauffman 
 V. Raeder, 108 Fed. 171, 47 C. C. A. 278, 54 L. R. A. 247; Lowber v. 
 Bangs, 2 Wall. 728, 17 L. Ed. 768. See Rioux v. Ryegate Brick Co., 
 72 Vt. at p. 155, 47 Atl. 406. In order to operate as a discharge or give 
 rise to a right of rescission, the partial failure to perform must go to the 
 very root of the contract. Chamberlin v. Booth, 135 Ga. 719, 70 S. E- 
 569, 35 L. R. A. (N. S.) 1223 ; Keenan v. Brown, 21 Vt. 86, is a case of 
 partial failure of performance, a,nd it was held that the defendant there- 
 
Sec. 2) . PARTIAL FAILURE OF rERFORlTANCB 537 
 
 in was not absolved thereby, and was only entitled to recover his dam- 
 ages. 
 
 Moreover, when a contract has been partly performed by one party, 
 and the other has derived a substantial benefit therefrom, the latter can^ 
 not refuse to comply with its terms simply because the former fails of 
 complete performance. Kauflman v. Raeder, supra; 13 C. J. 659. 
 "Where a person has received a part of the consideration for which he 
 entered into the agreement," says Mr. Serjt. Williams, "it would be un- 
 just that, because he has not had the whole, he should therefore be per- 
 mitted to enjoy that part without either paying or doing anything for it." 
 1 Saund. 320d. Hammond v. Buckmaster, 22 Vt. 375, is a case of this 
 class, and it was therein held that, inasmuch as each party had received 
 a partial benefit from the contract, and could not be placed in statu 
 quo, the defendant would have to perform the contract, seeking his 
 damages for the plairitifif's breach by cross-action. These holdings are 
 decisive of the case in hand. The stipulation in question was only a 
 part of the consideration of the defendant's undertaking ; was subordi- 
 nate and incidental to its main purpose; its breach is compensable in 
 damages ; and the defendant obtained and now holds a substantial bene- 
 fit under the contract. Other questions argued need not be considered. 
 
 The judgment below is without error, and is affirmed. 
 
 KINNEY V. FEDERAL LAUNDRY CO. 
 
 (Court of Errors and Appeals of New Jersey, 1907. 75 N. J. Law, 497, 68 
 
 Atl. 111.) 
 
 Action by George H. Kinney against the Federal Laundry Company. 
 Judgment for plaintiff, and defendant brings error. Affirmed. 
 
 GuMMERB, C. J. This action was brought by Kinney as assignee of 
 the Chicago Belting Company against the Federal Laundry Company 
 to recover the purchase price of certain belting sold and delivered to it 
 _ by the belting company. By the terms of the contract of sale, the ven- 
 dee was to pay the purchase price within 60 days and the vendor was to 
 replace any of the belting which should prove defective. The defendant 
 failed to pay the purchase money when it fell due, and later repudiated 
 its liability to do so upon the ground that some of the belts furnished 
 Tiad been discovered to be defective at the end of three months' user, 
 and that the vendor had failed to replace them when called upon to do 
 so. The belting company thereupon assigned their claim for the pur- 
 chase money to the plaintiff, who at once brought suit, declaring upon 
 the common counts alone. The defendant pleaded the general issue, 
 but failed to annex to its plea any notice of a claim against the plain- 
 tiff by way of recoupment. At the trial, after the plaintiff had proved 
 the sale and nonpayment, the defendant offered evidence showing that 
 some of the belting had been found to be defective aftfer it had been 
 
538 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 used for three months ; that this fact had been communicated to the 
 vendor before the assignment to the plaintiff and demand made upon 
 it to replace it with sound belting ; and that this demand had been ig- 
 nored. After hearing the defense, the trial judge overruled it and di- 
 rected a verdict for the full amount of the plaintiff's claim. 
 
 The single assignment of error relied upon by counsel for the de- 
 fendant challenges the soundness of this judicial ruling, the contention 
 being that the facts proved by the defendant constituted a bar to the 
 plaintiff's right to recover, for the reason that the agreement on the 
 part of the defendant to pay the purchase price was conditioned upon 
 the promise of the belting company to replace defective belting. In our 
 judgment this position is untenable. The promise of the vendee.to pay 
 was to be performed within 60 days. The promise of the vendor to re- 
 place defective belting was, by necessary implication, to be performed 
 within a reasonable time after discovery of the defect and notification 
 thereof. In construing contracts containing mutual promises, where 
 the time for the performance of the promise by one party is to arrive, 
 or may arrive, before the time for the .performance of the promise by 
 the other, the latter promise is Jheld to be an independent obligatioHj the 
 nonperformance of which raises a cause of action merely, and does not 
 constitute a bar to the right of the party making it to recover for a 
 breach of the promise made to him. 9 Cyc. p. 643; Benj. on Sales, § 
 738. And this rule of construction prevails as fully where the promise 
 is to pay money as where it is to do some other thing. Front Street, 
 etc., Ry. Co. v. Butler, 50 Cal. 574 ; American Emigrant Co. v. Adams 
 County, 100 U. S. 61, 25 I.. Ed. 563. 
 
 Applying this rule of construction to the contract in the present case, 
 the facts proved merely showed a right in the defendant to recover such 
 damages as it had sustained from a breach by the belting company of 
 an independent provision of the contract. But the defendant could only 
 have that right determined in the present suit by following the method 
 of procedure prescribed by section 105 of the practice act (P. L. 1903, 
 p. 568), which requires that a defendant who wishes to recoup damages 
 which he may have sustained by reason of any cause of action arising 
 out of the contract which is the subject of the action shall annex to his 
 plea and file therewith a notice of the particulars of his counterclaim. 
 This, as has already been stated, the defendant failed to do. The ac- 
 tion of the trial court, therefore, in taking from the jury the question 
 of the defendant's right to recoup and directing a verdict for the full 
 amount of the plaintiff's claim was entirely proper., 
 
 The judgment under review must be affirmed.*' 
 
 *5 See, also. United & Globe Rubber Mfg. Co. v. Conard, 80 N. J. Law, 286, 
 78 Atl. 203, Ann. Cas. 1912A, 412 (1910J. 
 
Sec. 2) PARTIAL PAILURH OF PEEFOKMANCE 539 
 
 ELLEN V. TOPP. 
 
 (In the Court of Exchequer, 1851. 6 Exch. 424, 155 Eng. Rep. 600.) 
 
 Covenant on an indenture of apprenticeship of the 21st of July, 
 1846, by the master against the father of the apprentice, the father 
 being a party to the indenture. The material parts of this indenture 
 (of which profert was made) were as follows: "This indenture 
 witnesseth, that Richard Topp, an infant, of the age of sixteen years 
 or thereabouts, by and with the consent of his 'father George Topp, of 
 &c., farmer, doth put himself apprentice to Frederick Ellen, of '&.C., 
 auctioneer, appraiser, and corn-factor, to learn his art, and with 
 him ^fter the manner of an apprentice to serve from the 1st day of 
 July now last past, unto the full end and term of five years from 
 thence next following, to be fully complete and ended; during which 
 term the said apprentice his master faithfully shall serve, his secrets 
 keep, his lawful commands everywhere gladly do." The indenture 
 then proceeded to state, that the apprentice should do no damage to 
 his- master, &c., and that he "shall not absent himself from his master's 
 service day or night unlawfully, but in all things as a faithful ap- 
 prentice he shall behave himself towards his said master and all his 
 during , the said "term ; and the said Frederick Ellen, in consideration 
 of the sum of £70 to him in hand paid by the said George Topp upon 
 the execution of these presents, (the receipt whereof the said Frederick 
 Ellen doth hereby acknowledge), doth hereby covenant and agree to 
 and with the said George Topp, his executors and administrators, 
 and also the said Rich^ird Topp, that he, the said Frederick Ellen, his 
 executors and administrators, his said apprentice in the art of an 
 auctioneer, appraiser, and corn-factor, which he useth, by the best 
 means- that he can, shall teach and instruct, or cause to be taught and 
 instructed, finding unto the said apprentice sufficient meat, drink, and 
 lodging, and other necessaries during the said term, except wearing 
 apparel, medical attendance, and pocket-money; and the said George 
 Topp, for himself, his executors and administrators, doth hereby 
 covenant and agree with the said Frederick Ellen, his executors and 
 administrators, that he the said George Topp, his executors and ad- 
 ministrators, shall and will find and provide his said son Richard 
 Topp with wearing apparel, medical attendance, washing, and pocket- 
 money during the said term; and for the true performance of all 
 and every the said covenants and agreements, either of the said 
 parties bindeth himself unto the other by these presents." The dec- 
 laration then stated, that the said Richard Topp afterwards, to wit, 
 on the said 21st of July, 1846, entered and was then received into the 
 service of the plaintifif as such apprentice as aforesaid, and continued 
 in such service under and by virtue of the said indenture, for a long 
 space of time, to wit, from the day and year last aforesaid until and 
 upon the 22nd of July, 1849 ; and laid as a breach that the said Richaird 
 
540 IMPLIED AND CONSTRTJCTIVB CONDITIONS PRECEDENT (Ch. 4 
 
 Topp did not nor would faithfully serve the plaintiff according to 
 the tenor and effect, true intent and meaning of the said indenture, but 
 on the contrary thereof, the said Richard Topp, during the said 
 term of five years in the said indenture mentioned, to wit, on the 
 said 22nd of July, 1849, did unlawfully absent himself from the serv- 
 ice of the plaintiff, and hath from thence hitherto remained and con- 
 tinued absent from the service of the plaintiff, contrary to the tenor 
 arid effect, of the said indenture and of the said covenant of the defend- 
 ant in that behalf made as aforesaid, to the plaintiff's damage, &c. 
 
 The defendant, after setting out the indenture on oyer, pleaded, 
 that the plaintiff, at the time of the making of the said indenture, as 
 in the declaration mentioned, exercised the art and carried on the 
 business of an auctioneer, appraiser, and corn- factor, as therein men- 
 tioned ; and that the apprenticeship and covenants aforesaid were made 
 with the plaintiff as such auctioneer, appraiser, and corn-factor, and 
 not otherwise; and that, after the making of the said indenture, and 
 before the accruing of the cause of action, &c., to wit, on &c., the 
 plaintiff voluntarily and of his own free will gave up, reUnquished, 
 abandoned, and ceased to exercise and carry on, and hath not, at any 
 time since, exercised and carried on the art and business of a corn- 
 factor as aforesaid. Verification. 
 
 Replication, that the plaintiff relinquished his business as a corn-fac- 
 tor aforesaid with the full knowledge and consent of the defendant 
 in that behalf ; and that, from the time of such relinquishment con- 
 tinually until the accruing of the cause of action in the declaration 
 mentioned, the said Richard Topp, with full knowledge of such re- 
 linquishment as aforesaid, continued, with the consent of the defend- 
 ant in that behalf, to serve the plaintiff under the said indenture. 
 Verification. 
 
 Special demurrer to the replication, inter alia, on the grounds that 
 the consent of the defendant to the relinquishment by the plaintiff of 
 his business of a corn-factor aforesaid, and to the continuing of the 
 said Richard Topp to serve the plaintiff as in the replication mentioned, 
 is not alleged to have been given or contained by or in any deed or 
 instrument under the seal of him the defendant ; and that the contract 
 in the declaration mentioned could- not in law be varied or altered by 
 parol, or by any consent other than a consent given or contained in 
 some deed or instrument under seal ; and that the replication is a de^ 
 parture from the declaration ; that the contract relied upon in the dec- 
 laration is a contract to employ and serve in the art and mystery 
 of an auctioneer, appraiser, and corn-factor; and the replication sets 
 up some new alleged contract to employ and serve in the art and 
 mystery of an auctioneer and appraiser only. 
 
 Joinder in demurrer. 
 
 The demurrer was argued in Easter Term last (Api'il 26th, 1850), 
 before Pollock. C. B., Parke, B., Rolfe, B., and Piatt, B., by i\'Iacnamara 
 for the defendant, in support of the demurrer, and by Taprell for the 
 
Sec. 2) PARTIAL FAILURE OF PERFORMANCE 541 
 
 plaintiff; and the Court took time to consider their judgment; but 
 afterwards Pollock, C. B., said that, as a difference of opinion exist- 
 ed among certain members of the Court, they wished to hear the case 
 reargued. The case was accordingly re-argued in Hilary Term last 
 (Jan. 20), before Pollock, C. B., Parke, B., Alderson, B., and Piatt, 
 B., by 
 
 Macnamara for the defendant^ in support of the demurrer. * * * 
 
 Thirdly. The exercise of the trades, or rather the non-abandon- 
 ment of any one of them by the master, is a condition precedent to 
 the service of the apprentice, or, in other words, they are dependent 
 covenants. The non-exercise of the trade for a few days merely would 
 not justify the apprentice in leaving; but the relinquishment of any 
 of them would. The doctrine of dependent covenants is fully dis- 
 cussed in the notes to Pordage v. Cole, 1 Wms. Saund. 320 b. ; and Cut- 
 ter V. Powell, 2 Smith's Leading Cases, 9; where the most important 
 cases bearing upon the subject are cited. The principle was laid down 
 by Lord Mansfield in Boone v. Eyre, 1 H. Bla. 273, n. ; 2 W.' Bla. 
 1312, which has been often recognized and acted upon. "The dis- 
 tinction is very clear," said that learned Judge; "where mutual 
 covenants go to the whole of the consideration on both sides, they are 
 mutual conditions, the one precedent to the other. But where they 
 go only to a part, where a breach may be paid for in damages, there 
 the defendant has a remedy on his covenant, and shall not plead it 
 as a condition precedent." The question seems to be, whether, not- 
 withstanding the breach, the contract can be substantially carried 
 out, and whether adequate compensation can be obtained for such 
 breach. The reason of the rule is, that the damages would be unequal 
 if a breach of a comparatively unimportant part of the contract af- 
 forded 'a ground for rescinding it altogether. The chief tests to be 
 applied appear to be the materiality and importance of the covenants 
 broken, and the difficulty of assessing damages thereupon. There is 
 a close analogy between these questions and those which relate to 
 penalties and liquidated damages. In the latter instance, the impor- 
 tance of the matter, the performance of which is secured by a penalty, 
 and the difficulty of estimating the . damages for its breach, are the 
 main points to be considered: Galsworthy v. Strutt (1 Exch. 659). 
 The rule adopted for the construction of covenants as dependent or 
 independent is this : — That the good sense of the case, the nature of 
 the instrument, and the intention of the parties, are to decide the ques- 
 tion. * * - * 
 
 Taprell contra. * * *« 
 
 The judgment of the Court was now delivered by 
 
 Pollock, C. B. This was an action on an indenture of apprentice- 
 ship by the master against the father of the apprentice, the father^ 
 having been party to the indenture. The breach assigned is, that the 
 
 ** Part of the argument of counsel is omitted. 
 
542 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 apprentice did not nor would faithfully serve the plaintiff according 
 to the tenor and effect of the indenture; but, on the contrary, did 
 on the 22nd of July, 1849, unlawfully absent himself from the service 
 of the plaintiff, and has thenceforth continued absent from such serv- 
 ice. [The Lord Chief Baron, after stating the pleadings, proceeded:] 
 On the part of the plaintiff it was scarcely contended that the replica- 
 tion could be supported. It is obviously bad. Such parol consent 
 cannot entitle the plaintiff to maintain an action of covenant in this 
 form, which is founded entirely on the deed under seal. The case 
 therefore resolves itself into the only question really argued' before 
 us, which was, whether the plea was good. 
 
 On the part of the plaintiff it was contended, that the plea afforded 
 no answer to the plaintiff's cause of action, on two grounds: first, 
 Mr. Taprell contended, that all which the plaintiff undertook to do 
 ivas to teach three trades; and that he might continue to do this, al- 
 though he had ceased to carry on one of them ; and that the plea con- 
 tained no averments that he was unable so to do. 
 
 But this objection is ill founded. The breach complained of is, that 
 the apprentice did not nor would serve tlie plaintiff according to the 
 tenor and effect and true intent and meaning of the indenture. Now, 
 looking to the indenture, we see that the real engagement was this — 
 the son Richard, with the consent of the defendant, his father, "put 
 himself apprentice to the plaintiff," described in the indenture as 
 "auctioneer, appraiser, and corn-factor, to learn his art, and with 
 him after the manner of an apprentice to serve ;" and then the defend- 
 ant, at the end of the deed, bound himself to the plaintiff for the 
 due performance of that engagement. What then was it which the 
 defendant covenanted that his son should do? To become the plain- 
 tiff's apprentice to learn his art, i. e. the act of an auctioneer, ap- 
 praiser, and corn-factor, and to serve with him after the manner of 
 an apprentice. Now, service with a man after the manner of an 
 apprentice imports, according to the meaning of those words as or- 
 dinarily understood, that the party served should be carrying on the 
 trade which the apprentice is to learn ; otherwise the one is teaching 
 and the other learning the trade,. not as master and apprentice but as 
 instructor and pupil. When therefore the one party ceases to carry 
 on the trade, he by his acl^ makes it impossible for the other to serve 
 him, after the manner of an apprentice; and he cannot be heard to 
 complain that the other party has not done that which he has wil- 
 fully made it impossible that he should do. 
 
 The other objection taken by Mr. Taprell was, that the carrying on 
 all the three trades was not a condition precedent to the plaintiff's 
 right to recover, but that his omission or refusal to carry on any one 
 must be the subject of a cross action. 
 
 This objection is founded on one of the rules for determining when 
 covenants are dependent on each other ; which is laid down in Boone v. 
 Eyre, 1 H. Bl. 273, n. (a), and followed in Campbell v. Jones, 6 T. 
 
Sec. 2) PARTIAL PAILDEB OF PERPORMANCH 543 
 
 R. 570, and other cases collected in the note to 1 Wms. Saund. 320 c. 
 That rule is, that when a covenant goes to part of the consideration 
 on both sides, that is, forms a part of the consideration on the plain- 
 tiff's side for the defendant's covenant on the other, and a breach of 
 such covenant may be paid for in damages, and the whole of the 
 remaining consideration has been had by the defendant, the covenant 
 is independent, and the performance of it is not a condition precedent. 
 
 "The reason of the decision in these cases is," as is observed by 
 the learned editor, "that where a person has received a part of the 
 ■consideration for which he entered into the agreement, it would be 
 unjust that, because he had not had the whole, he should therefore, be 
 permitted to enjoy that part without either paying or doing anything 
 for it. Therefore the law obliges him to perform the agreement on 
 his part, and leaves him to his remedy to recover any damages he may 
 have sustained in not having received the whole consideration." 
 
 It is remarkable that, according to this rule, the construction of 
 the instrument may be varied by matter ex post facto ; and that which 
 is a condition precedent when the deed is executed may cease to be 
 so by the subsequent conduct of the covenantee in accepting less: 
 as in the cases referred to, the defendant, in the first, might have 
 objected to the transfer, if the plaintiff had no good title to the negroes 
 and refused to pay ; in the second, he might have objected to the 
 payment if the plaintiff had refused to transfer the patent, though 
 he had been willing to teach the art of bleaching. But this is no 
 objection to the soundness of the rule, which has been much acted 
 upon. But there is often a difficulty in its application to particular 
 cases, and it cannot be intended to apply to every case in which a cove- 
 nant by the. plaintiff forms only a part of the consideration, and the 
 residue of the consideration has been had by the defendant. That 
 residue must be the substantial part of the contract; and if, in the 
 case of Boone v. Eyre, two or three negroes had been accepted, and 
 the equity of redemption not conveyed, we do not apprehend that the 
 plaintiff couW have recovered the whole stipulated price, and left the 
 defendant to recover damages for the non-conveyance of it. 
 
 Whether the rule can be applied' to the present case has been a 
 matter of great doubt in the minds of some of us : but, after much 
 consideration, we agree that it is not applicable. If this had been an 
 action on a covenant to pay an apprentice fee at the end of the term, 
 and the apprentice had served the whole period, and had had the ben- 
 efit of instruction as such in two of the trades, it would, we are disposed 
 to think have been n,o answer to the action that the plaintiff had dis- 
 continued one. But this is an action for not continuing to serve as 
 an apprentice; and although the later services of an apprentice are 
 much more valuable than the early, and are in part a compensation 
 to the master for his instruction in the commencement of the appren- 
 ticeship, and so are analogous in some degree to an apprentice fee 
 payable in futuro, yet the immediate cause of action is the breach of 
 
544 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT i(Ch. 4 
 
 the contract to serve, and the obligation to serve depends upon the 
 corresponding obligation to teach as an apprentice; and, if the mas- 
 ter is not ready to teach in the very trade which he has stipulated to 
 teach, the apprentice is not bound to serve. To this particular cove- 
 nant to serve, the relative duty to teach seems to us to be directly a 
 condition precedent ; and we are not able to distinguish between the 
 three trades of auctioneer, appraiser, and corn-factor, so as to say that 
 one is more the substantial part of the contract than another. 
 
 As the plaintiff by his own fault has disabled himself from acting 
 as a master in all the three trades, he has no right to complain of- 
 the defendant's son refusing to continue to serve in any. 
 
 Our judgment will therefore be for the defendant. 
 
 Judgment for the defendant.*^ 
 
 GRAVES v. LEGG et al. 
 
 (in the Court of Exchequer, 1854. 9 Exch. 709, 156 Eng. Rep. 304.) 
 
 The declaration stated, that it was on the 19th of May, 1853, through 
 Messrs. H. & R., brokers at Liverpool, agreed between, the plaintiff and 
 defendants in manner following, that is to say, the plaintiff then agreed 
 to sell to the defendants, and the defendants to buy of the plaintiff, 
 about 300 to 350 bales white-washed Donskoy fleece wool, to arrive 
 at 10%d. per pound, laid down either at Liverpool, Hull, or London, 
 deliverable at Odessa during August then next, old style, to be shipped 
 with all despatch, warranted fair average quality ; but should they prove 
 otherwise, to be .taken with a fair allowance ; which it was mutually 
 agreed between buyer and seller should be assessed by the said Messrs. 
 H. & R., subject to the safe arrival of the wool in good condition at any 
 of the ports stated, and the names of the vessels to be declared as soon 
 as the wools were shipped; customary allowances, payment cash in 
 fourteen days, less II/2 per cent, discount from the dat;e of finishing 
 loading. Which agreement being made, afterwards, the said wool, be- 
 ing 333 bales of wool of the quality and description in the said agree- 
 ment mentioned, was, during the said month of August, old style, de- 
 livered, to wit, by the growers thereof at Odessa, to wit, to the agents 
 of the plaintiff in that behalf, and was with all despatch then shipped 
 there on board a certain vessel called the "Science," which said vessel 
 
 " See, also, Chanter v. Leese, 4 M. & W. 296, 5 M. & W. 698 (1838), plain- 
 tiff agreed that defendant might make and sell under several patents; one 
 patent was void ; the defendant was held privileged to repudiate the whole, 
 nothing having as yet been done under the contract ; Jansen v. Schneider, 78 
 Misc. Eep. 48, 138 N. Y. Supp. 144 (1912), where one agreed to instruct an- 
 other to become an aviator for $250, but did not complete the instruction as 
 to the construction of the machine within a reasonable time, the breach went 
 to the essence; Vigers v. Cook, [1919] 2 K. B. 475, an undertaker is entitled 
 to nothing if he performs the service in all except that he fails to preserve the 
 body so that it can be taken into the church. 
 
Sec. 2) PARTIAL FAILURE OF PERFORMANCE 545 
 
 then sailed from Odessa with the said wool on board thereof, and after- 
 wards, to wit, on the ^2nd of November, 1853, arrived at Liverpool 
 with the said wool on board safe and in good condition, and according 
 to the terms of the said contract; and the plaintiff says, that the de- 
 fendants have had notice of all the said premises, and that a reasonable 
 time for the defendants to accept the said wools after the same ar- 
 rived, and to fulfil their part of the contract, and pay for the said 
 wools, has long since elapsed ; and that he, the plaintiff, has at all times 
 performed and fulfilled and been ready and willing to perform and 
 fulfil all conditions precedent to his right to have the said wools ac- 
 cepted and paid for, and to his right to rnaintain this action. Yet the 
 defendants would not at any time accept nor pay for the said wools, 
 or any part thereof. 
 
 Plea, that the defendants agreed with the plaintiff to buy the said 
 wool in the declaration mentioned for the purpose of reselling the same 
 in the way of their, the defendants' trade and business of wool dealers, 
 and thereby acquiring gains and profits. And further, that wool is an 
 article that fluctuates greatly in price in the market; and that the 
 defendants could only resell the said wool as aforesaid whpn, and not 
 before, the defendants had notice of the same being shipped, and when, 
 and not before, the name of the vessel in which it was so shipped had 
 been declared, according to the said contract in the declaration men- 
 tioned; of all. which premises the plaintiff, at the time of the making of 
 the said agreement, had notice ; and further, that, although the plaintiff 
 had such notice, yet the plaintiff did not declare to the defendants or 
 either of them, the name of the vessel in which the said wool was 
 shipped, or within the time at or within which he was by the agreement 
 bound to declare the same, that is to say, as soon as such wool was so 
 shipped, but omitted so to do, and delayed and omitted so to declare the 
 name of the said vessel in which the said wool was so shipped as in the 
 said declaration mentioned, or to give the defendants any notice of the 
 same being so shipped, for a long and unreasonable time after the same 
 was so shipped; and the defendants had not notice of the shipment of 
 the ,said wool, or of the name of the vessel in which the same had been 
 shipped, until after the expiration of a long and unreasonable time after 
 the same had been so shipped, and after the plaintiff was bound and 
 ought to have given and declared the same, and might and could have 
 done so ; and further, that, between the time when the name of the said 
 vessel dught to have been declared according to the said agreement in 
 the said declaration mentioned, and the time when it was first declared 
 to the defendants, or when they first had any notice of the said ship 
 having sailed with the said wool on board thereof, the price of wool in 
 the market had greatly fallen, and the said wool thence continually re- 
 mained so fallen in price, and the same, when the name of the said 
 vessel was first declared, and when the defendants first had notice or 
 knowledge of the same having been so shipped, would sell or could be 
 
 CORBIN CONT 35 
 
546 IMPLIED AND CONSTEDCTIVB CONDITIONS PRECEDENT (Ch. 4 
 
 sold only for a miich less suni of money than it would have done at the 
 time when the plaintiff ought to and could have declared the name of the, 
 said vessel, or given the defendants such notice as aforesaid. Where-, 
 fore the defendants did not nor would accept or pay for the said wool, 
 as in the said declaration mentioned. 
 
 Demurrer, and joinder. 
 
 The judgment of the Court was now delivered by 
 
 Parke, B. The pleadings in this case are these: [His Lordship 
 stated them, and proceeded:] The question raised by these pleadings 
 is, whether the provision, that the names of the vessels should be de- 
 clared as soon as the wools were shipped, was a condition precedent to 
 the defendants' obligation to accept and pay for the wools according to 
 the contract stated in the declaration, and under the circumstances 
 stated in the plea. 
 
 This contract, we think, is to be construed with reference to some of 
 those circumstances. It is stated in the plea, that the wool was bought, 
 with the knowledge of both parties, for the purpose of re-selling it in 
 the course of the defendants' business ; that it is an article of fluctuat- 
 ing value, and not saleable until the names of the vessels in which it 
 was shipped should have been declared according to the contract. 
 
 The declaration having averred, according to the S7th section of the 
 Common Law Procedure Act, the performance of conditions precedent 
 generally, the defendant proceeds in this plea to specify this condition 
 of declaring the names of the vessels, as one on the breach of which 
 he insists. The loss which he avers to have sustained by that breach is 
 immaterial. The only question is, whether the performance of the 
 agreement was a condition precedent or hot to the defendants' con- 
 tract to accept and pay for the goods. 
 
 In the numerous cases on the subject, in which it has been laid down 
 that the general rule is, to construe covenants and agreements to be de- 
 pendent or independent according to the intent and meaning of the par- 
 ties to be collected from the instrument, and of course to the circum- 
 stances legally admissible in evidence with reference to which it is to be 
 construed, one particular rule well acknowledged is, that where a cove- 
 nant or agreement goes to part of the consideration on both sides, and 
 may be compensated in damages, it is an independent covenant or con- 
 tract, and an action might be brought for the breach of it without aver- 
 ring performance in the declaration, under the old system of pleading; 
 and under the new, the denial of such performance would be bad ; and 
 the cases of Campbell v. Jones, 6 T. R. 570, and Boone v. Eyre, 2 
 Black. Rep. 1312 and 1315, are instances of the application of the rule. 
 But then it appears, as Mr. Serjt. Williams observes in 1 Saund. 320 
 d. (and the Lord Chief Baron, -in delivering the judgment of this 
 court in Ellen v. Topp, 6 Exch. 441, adopts the observation), the rea- 
 son of the decision in that and similar cases, besides the inequality of 
 damages, seems to be, that where a person has received part of the con- 
 
Sec. 2) PARTIAL FAILURE OF PERFORMANCE 547 
 
 sideration for which he entered into the agreement, it would be un- 
 just, that, because he had not the whole, he should therefore be permit- 
 ted to enjoy that part without either payment or doing anything for it. 
 Therefore the law obliges him to perform the agreement on his part, 
 leaving him to his remedy to recover any damage he may have sustain- 
 ed in not having received the whole consideration. Mr. Serjt. Williams 
 goes on to observe, that it must appear upon the record that the consid- 
 eration was executed in part. This may appear by the instrument de- 
 clared on itself, whereby a valuable right, part of the consideration, is 
 conveyed, as in Campbell v. Jones, or Boone v. Eyre, or by averment in 
 pleading. When that appears, it is no longer competent for the defend- 
 ant to insist upon the non-performance of that which was originally a 
 condition precedent; and this is more correctly expressed, than to 
 say it was not a condition precedent at all. 
 
 In this case, if the stipulation, that the^names of the vessels should 
 be stated as soon as the wools were shipped, was originally a condition 
 precedent, it is so still. No other benefit was taken under the contract 
 itself, as the consideration for the promise to pay the money, than the 
 shipment and delivery of the goods by the named vessels; nor was any 
 subsequently received by the acceptance of the goods or any part there- 
 of. After such acceptance, the defendants would have been bound to 
 pay the price, or the residue of it, and could not have insisted on the 
 neglect to narne in due time, but, if there had been any such neglect, 
 would nevertheless have had their remedy for the damage by cross ac- 
 tion on the contract to declare the names. In the state of things on this 
 record, the simple question is, whether this contract was originally a 
 condition precedent or not. Looking at the nature of the contract, and 
 the great importance of it to the object with which the contract was 
 entered into with the knowledge of both parties, we think it was a con- 
 dition precedent, quite as much, indeed, as the shipping of the goods at 
 Odessa with all dispatch after the end of August. And with respect 
 to the shipment itself, Mr. Blackburn did not venture to contend that 
 the performance of the plaintiff's contract in that respect was not a 
 condition precedent. 
 
 The defendants, therefore, have a right to object to fulfil the con- 
 tract on their part, as the plaintiff did not fulfil his, though they could 
 no longer object to the plaintiff's non-performance, had they afterwards 
 taken any benefit under the contract. 
 
 Judgment for the defendants.** 
 
 *' The arguments of Blackburn and C. E. Pollock have been omitted. 
 
548 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 KElvSO & CO. V. ELLIS et al. 
 (Court of Appeals of New York, 1918. 224 N. Y. 528, 121 N. E. 364.) 
 
 Action by Kelso & Company against Charles H. Ellis, Sr., and an- 
 other, copartners doing business under the firm name of Charles H. 
 Ellis & Son. Judgment on directed verdict for plaintiff affirmed by 
 Appellate Division (171 App. Div. 912, 155 N. Y. Supp. lli;^, and 
 defendants appeal,. Reversed, and new trial granted. 
 
 Pound, J. Thomas Howard, under the name of Thomas Howard 
 Company, dealt in advertising specialties in Brooklyn, N. Y. He had a 
 plan for- a piano contest whereby a merchant would offer a piano to 
 be voted for by his customers and given to the contestant receiving 
 the highest number of votes ; the right to vote being dependent, upon 
 the purchases mad6 at the store where the contest was being con- 
 ducted, during a given period. The idea was so to stimulate trade 
 beyond its usual activity as to enhance the sales of the merchant and 
 thus put money in his purse. Careful and voluminous instructions for 
 arousing public interest in the contest were an essential part of the 
 plan. Other prizes were offered to contestants, but the interest cen- 
 tered around the piano. Howard did not deal in pianos himself, but 
 when he obtained a customer for his scheme he placed an order with 
 a manufacturer for a piano to be shipped to such customer. The 
 plaintiff herein was a piano manufacturer. The defendants were 
 merchants in Port Chester, N. Y. On October 24, 1913, they entered 
 into a contract with Howard for the delivery at his earliest convenience 
 of one T. Howard Company $750 player piano, mahogany finished, war- 
 ranted and guaranteed for 10 years; five $500 certificates good on a 
 T. Howard Company $750 piano, mahogany finished, warranted and 
 guaranteed for 10 years ; 20 dozens assorted pieces of flat silverware, 
 permanently warranted. To be distributed by defendants the follow- 
 ing: 200 nomination letters, 500 follow-up letters, 1,500 circulars, 1,000 
 postal cards, 40 posters, 50 bulletins, 150 $1, 100 $2, and 300 $5 trading 
 books, 1 voting register, 1 Howard Company's instruction book, 2 sets 
 of "Display Card" signs, instructions for newspaper advertising, to be 
 done without expense to vendor, ,54,000 certificates in four colors for 
 piano votes in denominations of 5 to 25,000 votes ; all the foregoing to 
 be used in a piano advertising contest to open November 3, 1913, and 
 close May 3, 1914. 
 
 In consideration therefor they gave their six negotiable promissory 
 notes payable to Howard and due two, three, four, five, six, and seven 
 months after date, aggregating $650. The defendants agreed to "keep 
 the piano well displayed in my store," and it is a fair inference that it 
 was the intention of the parties that the piano should be delivered for 
 that purpose before the opening of the contest on November 3, 1913. 
 
 On December 4, 1913, Ploward sent an order to plaintiff to deliver a 
 player piano at once to the defendants. He had previously delivered to 
 them some of the silverware and all of the printed matter which they 
 
Sec. 2) PARTIAL FAILURE OF PERFORMANCE 
 
 549 
 
 made use of in a voting contest. But the contest without a piano was 
 like the play of Hamlet with the part of Hamlet left out. Plaintifif had 
 sold pianos to Howard for over two years and had shipped many pianos 
 to merchants for him; and had received from him notes of merchants 
 to whom it had shipped pianos on his order. He had previously told it 
 that he had an advertising plan; that he was supplying merchants 
 with pianos all over the country and he had thus obtained from it a 
 line of credit. It stenciled the name "T. Howard Company" on such 
 pianos. But plaintiff did not ship the piano to defendants. Howard 
 owed it upwards of $2,000 for- pianos actually shipped and further 
 credit was refused. On December 22, 1913, prior to the maturity of 
 the first note in suit, Howard transferred the Ellis notes to it, and it 
 gave him credit therefor on his general account as cash, knowing at the 
 time that no piano had been delivered by it to defendants. It does 
 not appear that plaintiff then had actual knowledge of the terms of 
 the contract between Howard and defendants. 
 
 This action is brought to recover on the notes. The answer sets up 
 many defenses and a counterclaim, none of which are substantial ex-^ 
 cept the defense that the plaintiff was not a holder in due course ; that 
 it did not take the notes in good faith and did not take them for value. 
 This defense calls for careful examination. 
 
 In the hands of Howard, the notes were subject to the defense that 
 the contract was entire, that there had been no full performance by 
 Howard, and that there was no obligation to pay until performance 
 was complete. Defendants were constantly demanding performance 
 by Howard on his contract to furnish the piano, and it cannot be said 
 as matter of law that there was a waiver on their part of this condition 
 of the contract. They therefore did not become liable to pay for or 
 return even the articles received in part performance. "A party may 
 retain, without compensation, the benefits of a partial performance, 
 where, from the nature of the contract, he must receive such benefits 
 in advance of a full performance, and by its terms or just construction 
 is under no obligation to pay until the performance is complete." Avery 
 V. Willson, 81 N. Y. 341, 344 (37 Am. Rep. 503). The agreement to de- 
 liver the piano and the other articles and the agreement to pay the notes, 
 being concurrent in time, were dependent, and Howard could not main- 
 tain an action against defendants without tendering full performance on 
 his part. Where a promissory note is given for the purchase money 
 on an executory contract for the sale of lands or chattels the law is 
 the same as obtains in a case where the only promise to pay is found 
 in the contract of sale itself, provided the action is between the orig- 
 inal parties. Ewing v. Wightman, 167 N. Y. 107, 60 N. E. 
 222 * * * 49 
 
 Judgment reversed and new trial granted. 
 
 *8 The court then held that there was evidence sufficient to go to the jury 
 that the plaintifE received the note with knowledge of the defense as against 
 Howard. " 
 
550 IMPLIED AND CONSTKDCTIVB CONDITIONS PRECEDENT (Ch. 4 
 
 : (c) Installment Contracts ' 
 
 HUNT'S CASE. 
 
 (In the Exchequer Chamber, 1588. Owen, 42.) 
 
 Hunt brought an action on the case against Torney, and declared 
 that he being seised of lands in Swainton in Norf. in fee, secundunn 
 ■ consuetudinem mannerii; the defendant did promise to the plaintiff, 
 in consideration the plaintiff would permit him to occupy the same 
 ;for the space of five years, that he would pay him at the Feast of 
 All-Saints next coming, and so yearly twenty pounds at the Feasts 
 of the Annunciation, and All-Saints by equall portions, during the 
 terme aforesaid, and alledged that he had injoyed the lands by the 
 jSpace of a year and half, and so brought his action on the assumpsit. 
 And Anderson was of opinion that untill the five years were expired, 
 no money was to be paid, because the contract was intire. But all the 
 other justices on the contrary, for the consideration was to pay a cer- 
 tain summe yearly, which made severall duties and so severall ac- 
 tions. For by Periam, if a man be bound to pay J. S. twenty pounds 
 in manner and forme following, viz. ten pounds at such a day, and 
 ^ten pounds at such a day, in this case the obligee cannot have an 
 action of debt for the first, before the day of payment of .the last 
 .ten pounds be past, because the duty in itself is an intire duty, but 
 if a man be bound to pay J. S. ten pounds at- such a day, and ten 
 ! pounds at such a day, here the obligee shall have his action for the first, 
 , because the duty was in itself severall. 
 
 Anderson at another day said, that if a man makes a lease for ten 
 .years, rendring rent, in that case he may have an assumpsit for the 
 rent due every year: so if I covenant with you to build you twenty, 
 houses, the covenantee shall have a severall action for each default. 
 
 Periam. That case of the assumpsit is much to the purpose, for an 
 assumpsit is in the nature of a covenant, and is indeed a covenant with- 
 out writing. 
 
 Rhodes cited this case: Gascoigne promised in consideration of a 
 niarriage of his daughter with such a man's son, to give seven hun- 
 , dred marks, and to pay a hundred marks every year, untill all the summ 
 were paid, and it was held clearly in this Court, that a severall ac- 
 tion might be brought upon every hundred pounds, but because the 
 , action was brought for all the seven hundred marks before the seven 
 years were out, judgment was given against him, for if a man be bound 
 in a bond of a hundred pounds to pay twenty pounds for so many 
 years, he shall not have an action of debt until the last year expired. 
 And after judgment was given for the plaintiff, viz. Mich. 29 Eliz. 
 Rot. 2248.=" 
 
 »» S. c, sub nom. Hunt v. Sone, Cro. Eliz. 118. ''. 
 
Sec. 2) INSTALLMENT CONTRACTS ' 551 
 
 GRANT V. JOHNSON. 
 (Court of Appeals of New York, 1851. 5 N. T. 247.) 
 
 Covenant on articles of agreement for the sale of land, between 
 the plaintiff (Grant) of the first part, and the fiefendant (Johnson) 
 of the second part. "The party of the first part for the consider- 
 ation of nine hundred and fifty dollars, to be paid as follows, to 
 wit: two hundred dollars on the first day of April next, two hun- 
 dred dollars on the first of April, 1847, the remainder in two an- 
 nual payments of equal amount, to be paid on the first of April of the 
 two succeeding years, together with interest from the first of April 
 next, agrees to sell to the party of the second part a certain piece of 
 land lying in the town -of Neversink" (describing it.) "And the party 
 of the first part, agrees to give to the party of the second part, the 
 quiet and peaceable possession of said premises on the first of Novem- 
 ber next, with the exception of certain privileges granted to Nicholas 
 JVakeley, and certain other privileges granted to Teunis Misener," &c. 
 "And the said party of the first part further agrees to give to the said 
 party of the second part a good and sufficient deed for the same on 
 the first of May next, if the above conditions are complied with." 
 
 The agreement contained a further stipulation, which it is unneces- 
 sary to mention, and was executed under the hands and seals of the 
 parties, on the twenty-fourth day of August, 1845. ; 
 
 The declaration assigned as a breach, the non-payment of the sec- 
 ond instalment of two hundred dollars, payable on the first of April, 
 1847; but it contained no averment of the tender of a deed of the 
 premises, before, on, or subsequent to the first day of May, 1846, or a 
 readiness or willingness to execute one, in accordance with the cove^ 
 nant of the plaintiff. 
 
 The defendant interposed several pleas, which, as no question arose 
 upon them, it is unnecessary to mention more particularly. 
 
 At the trial the plaintiff proved the agreement, and rested. The de- 
 fendant moved for a non-suit, on the ground that the plaintiff was 
 bound to show the delivery or tender of a d.eed before he could re- 
 cover the second instalment. 
 
 The judge decided that the covenants were independent, and that 
 the plaintiff could recover without showing either a delivery or tender 
 of a deed. To this decision the defendant excepted. 
 
 It was then admitted that the defendant had received possession of 
 the premises according to the contract, and had paid the first instal- 
 ment. He then offered to prove, that no deed of the premises in ques- 
 tion had been tendered to him up to the fifteenth of July, 1846. The 
 court rejected the evidence as not constituting a legal defence, and the 
 defendant excepted. The jury, under the direction of the judge, found 
 a verdict for the plaintiff for the amount of the second instalment, 
 and interest. Upon a bill of exceptions presenting the above facts> 
 
552 IMPLIED AND CONSTEUCTIVE, CONDITIONS PKECBDENT (Ch. 4 
 
 a motion for a new trial was made before the supreme court in the 
 third district, and denied. An issue of law arising upon a demurrer 
 to the replication of the plaintiff presenting the same question, had 
 previously been decided by the same court in favor of the plaintiff. 
 The new trial \yas denied, and the defendant's demurrer overruled, 
 upon the ground that the covenants were independent, and that the 
 plaintiff could recover without averring or proving performance, or 
 an offer to perform the covenant on his part. See 6 Barb. 337. From 
 this decision the defendant appealed to this court. 
 
 Gardiner, J.°^ The question in this case is, whether the plaintiif can 
 sustain an action for the second installment of the purchase-money 
 secured by the agr.eeraent, without averring and proving the delivery, 
 or an offer to deliver a deed of the premises. 
 
 The parties have declared that certain payments were to be made, 
 and certain acts performed by them respectively, at the times speci- 
 fied in the agreement. They must be held to have intended the per- 
 formance of these acts, when, and of course in the order of time in- 
 dicated in their covenants. The plaintiff was to give the defendant 
 possession on the 1st of November, 1845. The performance of this 
 requirement preceded any thing to be done by the defendant, and it 
 might consequently have been 'enforced without any offer upon the 
 part of the defendant ; but, if no possession had been given, the plain- 
 tiff could not have recovered the $200 to be paid by the vendee on the 
 1st of April, 1846. 
 
 The possession, however, was given, and the first $200 paid, and on 
 the 1st of May, 1846, the vendee was entitled to his deed as the thing 
 next to be done in the order prescribed by the parties in their agree- 
 ment. It was not executed, nor a willingness to execute it either aver- 
 red or proved. The payment of the $2Q0 for which the suit is 
 brought was fixed upon a day subsequent to that agreed upon for the 
 delivery of the deed. The case is, therefore, brought directly within 
 the letter and spirit of the 2d rule suggested by Sergeant Williams in 
 his note to Pordage v. Cole, 1 Saund. 3205, that, "when a day is ap- 
 pointed for the payment of money, etc., and the day is to happen after 
 the thing which is the consideration is to be perforrried, no action for 
 the money can be sustained without averritig performance." ' 
 
 The plaintiff relies upon the 3d rule of Serg'eant Williams in his 
 note to the case above cited, that "where a covenant goes only to a 
 part of the consideration on both sides, and a breach of such covenant 
 may be paid for in damages, it is an independent covenant, and an 
 action may be maintained, without averring performance." The rule 
 is not free from obscurity. . It was given by Lord Mansfield originally 
 in Boone v. Eyre, 1 H. Bl. 273, note a. The defendants in that suit, 
 after having received a conveyance of the equity of redemption of a 
 
 ^'^ The court's discussion of several cases and the concurring opinion of 
 Foot, J., are omitted. 
 
Sec. 2) INSTALLMENT CONTRACTS 
 
 353 
 
 plantation, and the negroes upon it, when sued for a part of the con- 
 sideration, set up a breach of a collateral covenant on the part of the 
 plaintiff, relating to the title and possession of the negroes, in bar of 
 the action. The warranty extended both to the estate and negroes. 4 
 Mees. & W. 311. The covenant of the plaintiff, it will be perceived; 
 embraced the whole and every part of the subject conveyed. If the 
 title failed to a single negro, or the defendant was evicted from an 
 acre of the. land, the covenant was intended to afford redress, and en- 
 able a jury to apportion the damages according to the agreement of 
 the parties. A "breach of the plaintiff's covenant might be paid for in 
 damages," because a failure of title as to any part of the consideration 
 could be compensated according to the standard fixed by the parties. 
 In other words, the consideration for the defendant's promise was 
 divisible, and the damages arising from a breach of the covenant of 
 warranty were apportioned to each parcel of that consideration, by 
 the agreement itself. This, it is supposed, is what is meant by the 
 expression above quoted, that the breach may be paid for in damages. 
 5 Mees. & W. 701. Accordingly it is stated in the note to Pordage v. 
 Cole, supra, that "when the consideration for the payment of the 
 money is entire and indivisible, so that the money payable is neither 
 apportioned by the contract, nor capable of being apportioned by a 
 jury, an action is not maintainable." 
 
 The doctrine is thus stated in Chanter v. Leese, 4 Mees. & W. ^11, 
 "The party contracting to pay his money is under no obligation to pay 
 for a less consideration than that for which he has stipulated. If, 
 indeed, he does accept a partial performance, and to a certain extent 
 enjoys the benefit of that for which he has stipulated, it may become 
 a question whether he may not be liable upon an implied contract to 
 pay for what he has had. And when the consideration is in its na- 
 ture capable of being divided, and the payment apportioned by the 
 terms of the contract, there may be still a right to recover the portion 
 due on the original contract." This decision was affirmed in the ex- 
 chequer chamber (5 Mees. & W. 701), in 1839, and may be considered 
 as the established doctrine in England at that day. 
 
 The rule of Lord Mansfield, according to its original application, 
 and as expounded in the decision above mentioned, is reasonable. It 
 brings us back to the contract to learn the intention of the parties. 
 Courts are not required to speculate, upon the inequality of loss to the 
 parties, or to look beyond the agreement to its performance, in order 
 to ascertain its character, as suggested by some judges and commenta- 
 tors. 1 Saund. 320a. These inquiries are proper where the question 
 arises, whether the plaintiff has any remedy for what he has done, or 
 parted with, or whether the defendant is not estopped by his acts sub- 
 sequent to the agreement, from insisting upon a condition precedent 
 in his favor. Much of the confusion in the books, it is believed, aris- 
 es from confounding the doctrine of waiver by matters ex post facto, 
 with a rule of construction applicable to the agreement as it came 
 
554 IMPLIED AND CONSTRUCTIVE CONDITIONS PEECEDENT (Ch. 4 
 
 from the hands of the parties. Havelock v. Gedde's, 10 East, 555. A 
 defendant may waive the performance by the plaintiff, in case of a 
 covenant clearly dependent, and tWus render himself liable in some 
 form of action (Mitchell v. Darthez, 2 Bing. N. C. 555 ; Lucas v. God- 
 win, 3 Id. 737), but it is only when the consideration is divisible, and 
 the payments are apportioned by the agreement to the different parts 
 of the consideration, that the covenant becomes independent, and a 
 recovery can be had upon the original contract without averring per- 
 formance, or an excuse for non-.performance. 
 
 A covenant, therefore, which goes only to a part of the considera- 
 tion, is not necessarily independent. Nor is it conclusive upon this 
 point that the consideration is divisible in its own nature, or that a part 
 of it has been received by the defendant; nor will the circumstance 
 that one or any number of covenants in an agreement are independ- 
 ent, render others so. * * * 
 
 The question then returns, was the consideration in this case divisi- 
 ble, and were the payments apportioned by the agreement to the dif- 
 fierent parts of the consideration within the principles above stated? 
 According to the contract, the $950 to be paid by the defendant, as 
 therein stipulated, was the entire consideration for a complete title to 
 the premises. The possession was incident to the title, the 'whole of 
 which the defendant was to receive as the consideration for his pay- 
 ments. He received one element of a complete title, to-wit, the pos- 
 session, on the 1st of November, 1845. He then paid on the. 1st Of the 
 following April all that he was to advance by the terms of the agree- 
 ment, until the fee should be added to the possession by a conveyance 
 from the plaintiff, and the title of the defendant be then perfected. 
 The plaintiff refuses or neglects to convey, and yet by this action 
 claims the purchase-money of the defendant. 
 
 If we assume that the consideration of the defendant's undertaking 
 was divisible, yet by the terms of the agreement he was to receive both 
 the possession and a deed of the premises before he could be called 
 upon for the payment of the installment in controversy. These things 
 were "to be done to him" according to the rule of Lord Holt, adopted 
 in Cunningham v. Morrell, 10- Johns. 206, 6 Am. Dec. 332. He was 
 not to trust to the personal responsibility of the plaintiff. Dey v. Dox, 
 9 Wend. 134, 24 Am. Dec. 137. ' The plaintiff had covenanted that 
 the thirig stipulated should be performed before the defendant could 
 be required to pay. Nor by the contract were the payments to be 
 made by the defendant apportioned to any particular part of the con- 
 sideration. He was not to pay any thing for the possession as distin- 
 guished from the fee of the land, but a gross sum for both by separate 
 installments. If he had refused to accept a deed, all that the plaintiff 
 could have recovered would have been the balance of the purchase- 
 money with interest. On the contrary had the plaintiff refused tO 
 convey, the recovery on the part ■ of the defendant would have been 
 confined to the difference between the contract price and the actual 
 
Sec. 2) INSTALLMENT CONTRACTS ■ 5^5 
 
 value of the land with interest. In a word, the covenant sought to b^ 
 
 .enforced against the defendant in this action went to the whole con-* 
 
 sideration on the other side, and depended on it. ,., ,. , 
 
 The judgment of the supreme court should be reversed. ., , 
 
 HILL V. GRIGSBY et al. 
 (Supreme Court of California, 1868. 35 Cal. 656.) ' , 
 
 This was an action upon nine promissory notes made jointly by 
 defendants to plaintiff, dated June 1st, 1865. The complaint was. in 
 the usual iorm. 
 
 The answer of the defendants admitted the ejcecution of the notes, 
 and as a defense to the action alleged, that at the time the notes were 
 executed, the plaintiff as vendor, and the defendants as vendees, entered 
 into a contract for the sale and purchase of one undivided half interest 
 in a quartz mill and certain real property in the State of Nevada ; that 
 the defendants agreed to pay the sum of eighteen thousand dollars ' for 
 the property, to be paid by installments, and that the notes sued on were 
 given for the last nine installments; that plaintiff executed a bond con-^ 
 ditioned for the conveyance of the property upon full payment of the 
 purchase money; that the whole amount of purchase money was" due 
 at the time this action was commenced, and that this action was brought 
 to recover the unpaid portion of the purchase money, incl'uditig 
 the note given for the last installment ; that about ten thousand dol- 
 lars of the purchase money had been paid; that the notes and bond 
 were executed and delivered contemporaneously, and are parts of 
 one contract for the sale and purchase of said property. ■ ■ 'i i 
 
 The answer further alleged that plaintiff, before the commencenierit 
 of this action, executed and delivered to one William G. Hill a deed 
 of "conveyance of the identical property described in said bond; that 
 plaintiff had not performed, or offered to perform, on his part, 'the 
 conditions of said bond; that neither plaintiff nor said William G. Hill 
 had tendered a deed for said property, and that they had not offered 
 to convey the same upon payment of the purchase money or other^ 
 wise. * * * . •■ 
 
 ' On the plaintiff's motion, the court struck out of the answer all 
 the defensive matter alleged therein, upon the ground that it is re- 
 dundant and immaterialv To which ruling the defendants duly ex- 
 cepted. 
 
 The plaintiff had judgment as demanded, and the defendants apf 
 pealed. .[ 
 
 " The other facts are stated in the opiniop of the Court. 
 
 By the Court, Rhodes, J."^ The leading question is, whether plain- 
 tiff is entitled to recover upon certain promissory notes representing 
 
 =2 Part of the statement of facts and part of opinion have been omitted. . s 
 
55H IMPLIED AND CONSTRUCTIVE CONDITIONS PEECEDENT (Ch. 4 
 
 the unpaid portion of the purchase money for certain real estate, sold 
 by the plaintiff to the defendants, without conveying or offering to 
 convey the property. The solution of the question depends upon the 
 construction to be given to the bond or covenant of the plaintiff. The 
 bond, after reciting the purchase and terms of payment, proceeds as 
 follows : 
 
 "Now, therefore, the said Hill agrees and binds himself, on con- 
 .dition that the said Grigsby and Smittle shall pay the sum of eighteen 
 thousand dollars, less eight thousand two hundred dollars hereto- 
 fore paid, with interest, as aforesaid, to execute and deliver to the 
 said Smittle and Grigsby a good deed, conveying all his right, title, 
 and interest of, in, and to the one undivided half interest in said mill 
 and premises herein as aforesaid, which if he shall well and truly do, 
 the above obligation to be null and void and of no effect;" other- 
 wise, the above obligation to be and remain in full force and effect. 
 The said deed to be executed by the said Hill as soon as the full sum 
 of eighteen thousand dollars and interest, as above provided, is paid, 
 and to be sufficient to convey to said Grigsby and Smittle one undivided 
 half interest in and to said mill, free f I'om all inctmibrance." 
 
 In the first clause the plaintiff covenants to convey on condition that 
 the defendants pay the price. These acts were, plainly intended to be 
 simultaneous, that is to say, the payment in full and the conveyance. 
 The words "on con'dition" are susceptible of no other interpretation. 
 The second clause was added as if to put the matter beyond question. 
 There the covenant is, to convey as soon as the full sum is paid. The 
 conveyance must, of necessity, be executed concurrently with or before 
 payment in full, or it will not be executed as soon as such payment is 
 made. 
 
 Neither argument nor illustration will make the meaning of the cove- 
 nants in respect to the time for their performance more apparent. 
 
 When the meaning of the terms employed in the covenants is as- 
 certained, the application of the rules of law governing the perform- 
 ance of the covenants is not difficult. In a contract for the sale of 
 real estate, where the purchaser .covenants to pay the purchase .money, 
 and the vendor covenants to convey the' premises at the time of pay- 
 ment, or upon the time of payment of the money, or as soon as it is 
 paid — and they all mean the same thing — the covenants are mutual 
 and dependent, and neither can sue without, showing a performance, 
 or an offer to perform, on his part ; and performance, or the offer to 
 perform, on the one part, is a condition precedent to the right to 
 insist upon a performance on the other part. Barron v. Frink, 30 
 Cal. 488. 
 
 When the purchase money is payable in installments, and the con- 
 veyance is to be executed on the last day of payment, or upon the pay- 
 ment of the whole price, or at, any previous day, the covenants to pay 
 the installments falling due before tlie time appointed for the execution 
 
Sec. 2) INSTALLMENT CONTRACTS 557 
 
 of the conveyance are independent covenants, and suit may be brought 
 thereon without conveying or offering to convey. 
 
 The covenants to pay the installments falling due on or after the day 
 appointed for the conveyance are dependent covenants, and the vendor, 
 in his suit to recover the same, whether he sues for those alone or joins 
 installments that became due before the time, must show a conveyance 
 or offer to convey. In these respects, contracts of all kinds are gov- 
 ^ emed by the same rule as covenants. 
 
 Questions covering the greater portion, if not the entire ground 
 occupied by those presented here, were considered at an early day in 
 this Court, and the decisions accord with the views here expressed. 
 Osborne v. Elliott, 1 Cal; 337; Folsom v. Bartlett, 2 Cal. 163. See, 
 also, Barron v. Frink, 30 Cal. 486. It is very correctly said in Bank 
 of Columbia v. Hagner, 1 Pet. 455, 7 L. Ed. 219, that "in contracts 
 of this description the undertakings of the respective parties are al- 
 ways considered dependent unless a contrary intention clearly ap- 
 pears"; and the reason assigned, as well as the rule, would be ap- 
 plicable here were the words of the covenant of doubtful import. "A 
 different construction would in many cases lead to the greatest injusr 
 tice, and a purchaser might have payment of the purchase money 
 enforced upon him, and yet be disabled from procuring the prop- 
 erty for which he paid it." The authorities in support of these prin- 
 ciples are very numerous, and there is a greater degree of uniformity 
 among them than is usual on a question presented, as this has been, in 
 so many different aspects. Pordage v. Cole, 1 Wm. Siund. 320; 
 Jones V. Gardner, 10 Johns. (N. Y.) 266 ; Gazley v. Price, 16 Johns. 
 (N. Y.) 267; Parker v. Parmele, 20 Johns. (N.' Y.) 130, 11 Am. Dec. 
 253; Williams v. Healey, 3 Denio (N. Y.) 367; Johnson v. Wygant, 
 11 Wend. (N. Y.) 48; Bean v. Atwater, 4 Conn. 3, 10 Am. Dec. 97; 
 Lester v. Jewett, 11 N. Y. 453; Hunt v. L,ivermore, 5 Pick. (Mass.) 
 395 ; Kane v. Hood, 13 Pick. (Mass.) 281 ; 1 Pars, on Cont. 42 ; 2 
 Smith L. C. 17. * * * 
 
 We are of opinion that the portion of the answer setting up the 
 contract of sale, and alleging the failure of the plaintiff to convey, 
 or offer to convey, to the defendants the interest in the premises sold 
 to them, is a good defense to the action, and that the order striking* 
 it out was erroneous. 
 
 Judgment reversed, and cause remanded for further proceedings."' 
 
 fi^in accord: Beecher v. Conradt, 13 N. Y. 108, 64 Am. Dec. 535 (1855) ; 
 Gray v. Hinton (C. C.) 7 Fed. 81 (1881) ; Eddy v. Davis, 116 N. Y. 247, 22 
 N. E. 362 (1889) ; Irwin v. Lee, 34 Ind. 319 (1870) ; Soper v. Gabe, 55 
 Kan. 646, 41 Pac. 969 (1895). See, also, Cunningham v. Morrell, 10 Johns. 
 (N. Y.) 203, 6 Am. Dec. 332 (1813) ; Glenn v. Rossler, 156 N. Y. 161, 50 N. E. 
 785 (1898). 
 
 Observe that mutual promises may be dependent, eveil though the agreement 
 of which they form a part is evidenced by several entirely separate documents, 
 for these will be construed together. Hunt v. Livermore, 5 Pick. (Mass.) 
 395 (1827) ; Bryne v. Dorey, 221 Mass. 399, 109 N. E. 146 (1915). In Ewing v. 
 
558 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 GRAY V. MEEK. 
 (Supreme Court of lUinois, 1902. 199 III. 136, 64 N. E. 1020.) 
 
 This suit was brought in the circuit court of Cook county by S. M. 
 Meek, defendant in error, against Addlph Gray, plaintiff in error, on 
 a certain written contract and supplemental contract between the par- 
 ties. The original contract of October 25, 1890, provided: That Gray 
 was to act as the agent of Meek in selling about 80 lots that Meek 
 owned in a certain subdivision. That Gray was to have the exclusive 
 right of selling these lots for one year, and no longer, at prices aver^ 
 aging $130.50 per lot for all inside lots, and $175 for corner lots and 
 lots fronting on Milwaukee avenue; ihe first payment to be not 
 less than $5 down, and monthly payments to be not less than $2.50; 
 all deferred payments to draw 6 per cent, interest per. annum. That 
 Meek agreed to convey the lots when paid for according to the agree- 
 ment. That, of the cash paid in on the contracts of sale, one-half 
 should go to Meek, and one-half to Gray, as his commission, less 10 
 per cent, on such half (the ten per cent, to be kept back until final set- 
 tlement),, and all amounts over and above the stipulated prices for the 
 lots realized on the sales should go to . Gray in full payment for his 
 services in making such sales. That, in case, any lots remained un- 
 sold at the end of the year. Gray was to buy such remaining lots, 
 and Meek to sell them to him, at the above prices, and to allow the 
 10 per cent, kept back to apply on the purchase price of the lots so 
 remaining, and Gray to pay the balance on the same terms and at the 
 same prices as provided on sales to others. After the expiration 
 of the year provided in this contract, * * * the plaintiff sued for 
 the agreed price of the lots remaining unsold. The plea was the gen- 
 eral issue. The jury found a verdict for $5,468.03 for the plaintiff 
 below, being the total amount claimed by him to be due on the contract, 
 and judgment was entered for the same. The appellate court affirmed 
 the judgment, and .the defendant below has brought the case before us 
 on writ of error.'* 
 
 Carter, J. * * * It is next urged by plaintiff in error that the 
 defendant in error is not entitled to a recovery on the basis of the 
 agreed price of the lots, but that the true measure of damages is the 
 difference between the agreed price and the, fair market value at the 
 
 ■JViglitman, 167 N. T. lOT, 111, 60 N. E. 322 (1901) the court said: "Some 
 learned text-writers have asserted the doctrine that promises contained in 
 unilateral contracts cannot be dependent, though each is given in consideration 
 of the other, and have criticised the cases in this country holding a contrary 
 rule. Whatever may be the force of the arguments of those writers, or what- 
 ever the rule in England, the general current of authority in this and other 
 states is opposed to that doctrine." Where a note is given for a return prom- 
 ise, it should not be called a "unilateral contract," even though the promises 
 are contained in separate instruments. 
 
 6* The terms of a supplemental contract and a small part of the opinion 
 are omitted. 
 
Sec. 2) INSTALLMENT CONTRACTS 559 
 
 time Gray agreed to take and pay for the lots in question. This con- 
 tention is not tenable. Meek sued on the contract, by which Gray 
 agreed, to pay the stipulated prices for the lots unsold at the expiration 
 of the contract. When this contract was extended, he again agreed 
 to take the lots tuisold at the expiration of the extension, and to pay the 
 stipulated prices, and both contracts contained specific directions as 
 to the application of moneys received towards paying for these lots 
 to be taken by Gray. 
 
 It is also urged that there was no tender of a deed for these lots 
 from Meek to Gray pleaded or proved. There was no tender pleaded, 
 but no advantage was taken of this in apt time. The only proof in 
 regard to a tender is the evidence of Meek that he offered Gray a deed 
 for these lots, and the further offer he made in a letter to give him a 
 deed and take a mortgage back. Nothing further was elicited in re- 
 . gard to the tender. No tender was necessary, under the terms of the 
 contract, until the last payment became due, as Meek did not agree 
 to make a conveyance until the lots. were paid for. But demanding 
 the whole amount due on these lots, he should have tendered a deed. 
 A purchaser. Of properly to be paid for in installments, where there is 
 no time fixed for the delivery of the deed, is not entitled to receive his 
 deed until the last payment is made; nor is a purchaser obliged to 
 ' part with his money before he receives the deed. Duncan v. Charles, 
 4 Scam. 561 ; Weiss v. Binnian, 178 111. 241, 52 N. E. 969. The lots 
 were to be paid for, $5 down, and monthly payments of not less 
 than $2.50. The time for all payments by Gray had elapsed when suit 
 was brought. The obligation to pay all but the last installment was 
 absolute and unconditional. By neglecting to enforce payment on 
 these installments aS they became due. arid by waiting until the, last 
 one became due and the time for making the conveyance had elapsed, 
 the promise to pay the previous installments, once absolute and inde- 
 pendent, did not become mutual and dependent. Duncan v. Charles, 
 supra ; Sheeren v. Moses, 84 111. 448. To remedy this error respecting 
 the failure to tender a deed, defendant in error offers to enter a re- 
 mittitur in this court for the amount of the last payment on these lots, 
 33 in number, and interest thereon, namely $94.87. * * * 
 
 As the judgment below was too large by the amount of the last 
 payment and interest thereon, to wit, $94.87, and as the defendant in 
 error remits that amount, the judgment will be affirmed as to the 
 balance, except as to costs in the appellate court. The judgment for 
 such costs will be reversed, and all costs incurred in this court up to 
 the time of entering the remittitur will be taxed against the defendant 
 in error. Remittitur allowed and judgment affirmed." 
 
 " See, also, Loud v. Pomona Land & Water Co., 153 U. S. 564, 14 Sup. 
 Ct. 928, 38 L. Ed. 822 (1894) ; Sheeren v. Moses, 84 111. 448 (1877) ; Bowen 
 V. Bailey, 42 Miss. 405, 2 Am. Rep. 601 (1869). 
 
560 IMPLIED AND CONSTRUCTIVE CONDITIONS PEECEDENT (Ch. 4 
 
 WITHERS V. REYNOLDS. 
 (In the Court of King's Benchi 1831. 2 Bam. & Adol. 882.) 
 
 Assumpsit for not delivering straw to the plaintiff pursuant, to 
 agreement. At the trial before Lord Tenterden, C. J., at the sittings 
 in Middlesex after last Hilary term, the agreement proved was as 
 follows : 
 
 "John Reynolds undertakes and agrees to supply Joseph Withers 
 with wheat straw of good quality sufiScient for his use as a stablekeep- 
 er, and delivered on his premises as above" (i. e. at Long Acre, Lon- 
 don) "till the 24th of June 1830, at the sum of thirty-three shillings 
 per load of thirty-six trusses, to be delivered at the rate of three 
 loads in a fortnight, in a dry state and without, damage. And the said 
 J. W. hereby agrees to pay to the said J. R. or his order the sum 
 of thirty-three shillings per load for each load of straw so delivered 
 on his premises from this day till the 24th of June 1830, according to 
 the terms of this agreement. 
 
 "[Signed] Joseph Withers, John Reynolds." 
 
 The straw was regularly sent in from the 20th of October 1829, 
 when this agreement was made, till the end of January 1830. At 
 that time, the plaintiff being in arrear for several loads of straw, the 
 defendant called upon him for the amount, and he thereupon tendered 
 to the defendant ill. lis., being the price of all the straw clelivered 
 except the last load, saying that he should always keep one load in 
 hand. The defendant objected to this; but was at length obliged to 
 take the sum offered: and he then told the plaintiff that he would 
 send no more straw unless it was paid for on delivery : and accord- 
 ingly no more was sent. On the part of the defendant it was sub- 
 mitted that there must be a nonsuit, inasmuch as the plaintiff, on his 
 own shewing, had not performed his own part of the contract, which 
 was, in effect, to .pay for each load on delivery. Lord Tenterden C. 
 J. was of this opinion: but directed a verdict for the plaintiff, re- 
 serving the point. A rule nisi was afterwairds obtained for entering 
 a nonsuit. 
 
 Campbell and R. V. Richards now shewed cause. Two things in- 
 dependent of each other were stipulated by this contract to be done 
 by the respective parties: the defendant was to deliver straw; the 
 plaintiff to pay the price. No time of payment was specified. There 
 appears nothing which could entitle the defendant to insist on re- 
 ceiving his money ,till the whole quantity of straw was delivered. 
 Payment, then, was not a condition of the defendant's performance of 
 his contract. His promise was given in consideration that the plain- 
 tiff promised to pay, not in consideration of performance. If the 
 plaintiff was bound to pay for each load on delivery, still it does not 
 follow that a refusal to pay for 'one load excused the defendant 
 from any future performance of his contract. Weaver v. Sessions 
 
Sec. 2) INSTALLMENT CONTRACTS . 561 
 
 (6 Taunt. 154) And, according to that case, he ought at least to 
 have shewn that he subsequently made a tender of executing his part 
 of the agreement, which the plaintiff rejected. The defendant, there- 
 fore, upon his construction of the agreement, may be entitled to bring a 
 cross action, but has no defence to this. 
 
 Piatt, contra. The only question is upon the construction of this 
 agreement. It is true, no time of payment was specified, but in the 
 absence of any express stipulation, the money would be payable on 
 demand as often as it became due ; and here the words, "to pay 
 thirty-three shillings per load for each load so delivered," intimate that 
 the price of each load was to be due as soon as it was delivered. [Here 
 he was stopped by the Court.] 
 
 Lord TenterdEn, C. J. I am of opinion that the plaintiff is not en- 
 titled to recover. There is, I think, no doubt that by the terms of 
 this agreement the plaintiff was to pay for the loads' of straw as they 
 were delivered. If that were not so, the defendant would have been 
 liable to the inconvenience of giving credit for an indefinite length 
 of time, and, in case of non-payment, bringing an action for a very 
 large sum of money, which does not appear to have been intended 
 by the contract. Then the only question is, whether upon the plain- 
 tiff's saying, "I will not pay for the goods on delivery" (for that was 
 the effect of his communication to the defendant), it was incumbent 
 on the defendant to go on supplying straw; and he clearly was not 
 obliged to do so. 
 
 Parke, J. The substance of the agreement was, that the straw should 
 be paid for on delivery. The defendant clearly did not ^^sontemplate 
 giving credit; When, therefore, the plaintiff said that he would not 
 pay on delivery, (as he did, in substance, when he insisted on keep- 
 ing one' load on hand,) the defendant was not obliged to go on supply- 
 ing him. • 
 
 Taunton, J. The contract does not say merely that so much straw 
 shall be supplied at thirty-three shillings a load, but it adds, that the 
 plaintiff shall pay that sum "for each load of straw delivered on his 
 premises," from the date of the agreement till the 24th of June 1830. 
 That prima facie imports that each load was to be paid for as deliv- 
 ered. 
 
 PatTeson, J. If the plaintiff had merely failed to pay for any par- 
 ticular load, that, of itself, might not have been an excuse to the de- 
 fendant for delivering no more straw: but the plaintiff here express- 
 ly refuses to pay for the loads as delivered,; the defendant, therefore, 
 is not liable for ceasing to perform his part of the contract. 
 
 Rule absolute.^" 
 
 "In accord: Stephenson v. Cady, 117 Mass. 6 (1875). Of. West v. Bechtel, 
 125 Mich. 14^, SI N. W. 69, 51 L. R. A. 791 (1900). 
 
 COEBIN CONT 36 
 
562 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 GILL V. JOHNSTOWN LUMBER fco. 
 (Supreme Court of Pennsylvania, 1892. 151 Pa. 534, 25 Atl. 120.) 
 
 Action by John L. Gill against the Johnstown Lumber Company for 
 services for driving logs. Verdict was directed for defendant, and 
 plaintiff appeals. Reversed. 
 
 Heydrick, J. The single question in this cause is whether the con- 
 tract upon which the plaintiff sued is entire or severable. If it is en- 
 tire, it is conceded that the learned court below properly directed a 
 verdict for the defendant ; if severable, it is not denied that the cause 
 ought to have been submitted to the jury. The criterion by which it 
 is to be determined to which class any particular contract shall be as- 
 signed is thus stated in Parsons on Contracts, 29-31 : "If the part to 
 be performed by one party consists of several and distinct items, and 
 the price to be paid by the other is apportioned to each item to be per- 
 formed, or is left to be implied by law, such a contract will generally be 
 held to be severable. * * * But if the consideration to be paid is 
 single and entire, the contract must be held to be entire, although the 
 "subject of the contract may consist of several distinct and wholly inde- 
 pendent items." The rule thus laid down was quoted with approval and 
 applied in Oil Co. v. Brewer, 66 Pa. 351, and followed in Rugg v. 
 Moore, 110 Pa. 236, 1 Atl. 320. It was also applied in Ritchie v. At- 
 kinson, 10 East, 295, a case not unlike the present. There the master 
 and freighter of a vessel of 400 tons mutually agreed that the ship 
 should proved to St. Petersburgh, and there load from the freighter's 
 factors a complete cargo of hetnp and iron, and deliver the same to the 
 freighter at London on being paid freight, for hemp £5 per ton, for 
 iron 5s. per ton, and certain other charges, one half to be paid on de- 
 livery and the other at three months. The veSBel proceeded to St. 
 Petersburgh, and when about half loaded was compelled by the im- 
 minence of a Russian embargo upon British vessels to leave, and re- 
 turning to London delivered to the freighter so much of the stipulated 
 cargo as had been taken on board. The freighter, conceiving that the 
 contract was entire, and the delivery of a complete cargo a condition 
 precedent to a recovery of any compensation, refused to pay at the 
 stipulated rate for so much as was delivered. Lord EllEnborough 
 said: "The delivery of the cargo is in its nature divisible, and there- 
 fore I think it is not a condition precedent; but the plaintiff" is entitled 
 to recover freight in proportion to the extent of such delivery • leaving 
 the defendant to his remedy in damages for the short delivery." > 
 
 Applying the test of an apportionable or apportioned consideration 
 to the contract in question, it will be seen at once that it is severable. 
 The work undertaken to be done by the plaintiff consisted of several 
 items, viz., driving logs, first, of oak, and, second, of various other kinds 
 of timber, from points upon Stony creek and its tributaries above 
 Johnstown to the defendant's boom at Johnstown, and also driving 
 
Sec. 2) INSTALLMENT CONTRACTS 563 
 
 cross-ties from some undesignated point or points, presumably under- 
 stood by the parties, to Bethel, in Somerset county, and to some other 
 point or points below Bethel. For this work the consideration to be 
 paid was not an entire sum, but was apportioned among the several 
 items at the rate of $1 per 1,000 feet for the oak logs; 75 cents per 
 1,000 feet for all other logs ; 3 cents each for cross-ties driven to Bethel ; 
 and 5 cents each for cross-ties driven to points below Bethel. But 
 while the contract is severable, and the plaintiff entitled to compensa- 
 tion at the stipulated rate for all logs and ties delivered at the specified 
 points, there is neither reason nor authority for 'the claim for compensa- 
 tion in respect to logs that were swept by the flood to and through the 
 defendant's boom, whether they had been driven part of the way by 
 plaintiff, or remained untouched by him at the coming of the flood. In 
 respect to each particular log the contract in this case is like a contract 
 of common carriage, which is dependent upon the delivery of the goods 
 at the designated place, and, if by casus the delivery is prevented, the 
 carrier cannot recover pro tanto for freight for part of the route over 
 which the goods were taken. Whart. Cont. § 714. Indeed, this is but 
 an application of the rule already stated. The consideration to be paid 
 for driving each log is an entire sum per 1,000 feet for the whole dis- 
 tance, and is not apportioned to parts of the drive. 
 The judgment is reversed, and a venire facias de novo is awarded." 
 
 KELIvY CONST. CO. v. HACKENSACK BRICK CO. 
 
 (Court of Errors and Appeals of New Jersey, 1918. 91 N. J. Law, 585, 103 
 Atl. 417, 2 A. L. R. 685.) 
 
 Action by the Kelly Construction Company against the Hackensack 
 Brick Company. Judgment for plaintiff on a directed verdict, and de- 
 fendant appeals. Affirmed. 
 
 TrEnchard, J.=' The plaintiff below brought this action to recover 
 damages for the refusal of the defendant to perform a contract to de- 
 liver brick. A verdict was directed for the plaintiff at the Bergen cir- 
 cuit and the defendant appeals. We are of the opinion that the judg- 
 ment must be affirmed. 
 
 No objection is made to the amount of the verdict directed. The de- 
 fendant's contention is that it was legally justified in its refusal to com- 
 plete its contract. We think that contention is unsound, and we find 
 no error in record. 
 
 B' In Leonard v. Dyer, 26 Conn. 172, 68 Am. Dec. 382 (1857), the plaintiff 
 was given judgment at the contract rate for transporting 49,000 feet of lumber, 
 where the contract was to transport a lot of about 75,000 feet at the rate of 
 $'' 25 per thousand, a flood having prevented the loading of the balance. See, 
 further Snook v. Fries, 19 Barb. (N. Y.) 313 (1855) ; Ming v. Corbin, 142 N. 
 Y 334 37 N E. 105 (1894) ; Barnes v. Leidigh, 46 Or. 43, 79 Pac. 51 (1905) ; 
 Wooten V. Walters, 110 N. C. 251, 14 S. E. 734, 736 (1892). 
 
 =8 Part of the opinion is omitted. 
 
564 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 The plaintiff had a contract for the building of a high school at Engle- 
 wood. It placed a written order with the defendant for the "furnish-, 
 ing and delivering and stacking on the job all the common hard brick 
 required by the plans and specifications for the Englewood High School 
 at $7 per thousand ; brick to be delivered as required by us and suffi- 
 cient brick to be kept on the job so that we will always have approxi- 
 mately 50,000 brick stacked until the completion of the job." This or- 
 der the defendant accepted in writing. Neither the order nor the ac- 
 ceptance fixed any time for payment. The defendant after delivering 
 some of the brick, refused to complete the contract, and a verdict was 
 directed on the basis of the difference between the contract price and 
 that which the plaintiff was required to pay in the market for the re- 
 mainder of the brick contracted for. The defendant's contention is 
 that it was legally justified in refusing to complete its contract by reason 
 of the admitted fact that the brick already delivered in part performance 
 of the contract had not been paid for. But that contention is unsound 
 in law. Where, as here, the sale is of a specified quantity of brick (i. e., 
 sufficient to complete a building according to stated specifications) , the 
 contract is entire, and a failure to pay when a part delivery has been 
 made does not excuse the seller from completing delivery; no time for 
 payment being stated in the contract. Baker v. Higgins, 21 N. Y. 397. 
 
 And this is so notwithstanding section 42 of the Sale of Goods Act 
 (C. S. p. 4657), enacting that "unless otherwise agreed, delivery of the 
 goods and payment of the price are concurrent conditions," etc. This 
 section does not require payment with each delivery where, as here, such 
 deliveries are made pursuant to an entire contract for goods the quan- 
 tity and character of which necessitates delivery in installments. * '* * 
 
 The judgment will be affirmed, with costs. °® 
 
 MiNTURN, J., dissents. 
 
 POLLAK V. BRUSH ELECTRIC ASS'N. 
 
 (Supreme Cdurt of the United States, 18SS. 128 U. S. 446, 9 Sup. Ct. X19, 
 
 32 L. Ed. 474.) 
 
 This writ of error brings up for review a judgment in favor of the 
 Brush Electric Association of St. Louis, plaintiff below, against the 
 plaintiff in error for the sum of $6,458.10. Besides the common 
 count for goods and merchandise sold to the defendant, Pollak, the 
 complaint contains a special count, based on a written agreement be- 
 tween the parties, executed November 13, 1883. By the first article 
 of that agreement Pollak agreed to pay to the plaintiff the sum of 
 $7,942, as follows : "Seven thousand dollars in cash on the execution 
 of this agreement, and the sum of nine hundred and forty-two dollars 
 on the 1st day of January, 1884, in full settlement and satisfaction of 
 
 '* Certain installment contracts were held "entire" in Consumers' Bread 
 Co. V. Stafford Mills Co., 152 CO. A. 527, 239 i'ed. 693 (1917) ; Karales t. 
 Los Angeles Creamery Co., 36 Cal. App. 171, 171 Pac. 821 (1918). 
 
Sec. 2) INSTALLMENT CONTRACTS 565 
 
 all claims and dem^jids due by Pollak & Co. and the Brush Electric 
 Light and Power Company of Montgomery, Ala., to the said Brush 
 -Electric Association of St. Louis ; and the Brush Electric Association 
 agrees to transfer, or cause to be transferred, to said Ignatius Pollak, 
 without recourse, all the shares now held by the said Brush Electric 
 Association and the Brush Electric Company of Cleveland, Ohio, in 
 the said Brush Electric Light and Power Compariy of Montgomery, 
 Ala." 
 
 The remaining articles of the agreement are in these words : 
 
 "Second. The said Brush Electric Association of St. Louis agrees 
 to furnish to the said Ignatius Pollak one number 8 dynamo-electric 
 machine, one automatic dial for said machine, and forty arc lamps of 
 two thousand candle power each, of different styles, for which the 
 said Ignatius Pollak agrees to pay to th,e said Brush Electric Associa- 
 tion of St. Louis by the 1st day of January, 1885, twelve per cent, of 
 the cost of said machinery, as per card-rate hereto attached, signed by 
 the parties, and made a part of this agreement, which card-rate is 
 agreed by the parties to be the cost of said machinery. This twelve 
 per cent., it is agreed by the parties, is to be considered a rental of said 
 machinery, dial, and lamps for the term of one year, and which are 
 furnished to enable the said Ignatius Pollak to comply with his con- 
 tract with the city council of Montgomery to light the streets of the 
 citv of Montgomery with electric lights. 
 
 "Third. It is further agreed that in case the city council of Mont- 
 gomery shall conclude to adopt the Brush electric light for the future 
 lighting of the streets of the said city of Montgomery, Ala., after the 
 expiration of the time of the present contract between said Pollak and 
 Company and the city council of Montgomery, that the said Igna- 
 tius Pollak will pay to the said Brush Electric Association of St. 
 Louis, Mo., by the 1st day of January, 1885, the cost of said machin- 
 ery, dial, and lamps, as fixed and ascertained by said card-rate hereto 
 attached." [This card-rate fixed the total cost at the sum of $6,180.] 
 
 [There were further provisions not material to the point now un- 
 der consideration. The city council did in fact adopt the Brush light 
 for a future period thus fulfilling the express condition of article 
 Third.] 
 
 > Mr. Justice Harlan. * * * *" 4. It is also contended that the 
 plaintiff was not entitled to recover, except upon averment or proof 
 that it had. transferred or offered to transfer to the defendant the 
 shares of stock held by it and by the Brush Electric Company of 
 Cleveland, Ohio, in the Brush Electric Light & Power, Company of 
 Montgomery. This cannot be, unless, as insisted, his promise to pay, 
 in the contingency named in the third article of the agreement of No- 
 vember 13, 1883, the sum of $6,180, was in consideration of the plain- 
 tiff's promise to transfer, or have transferred to him, the above shares. 
 
 «" The statement of facts has been abridged and part of the opinion 
 omitted. 
 
566 IMPLIED AND CONSTRUCTIVE CONDITIONS PEECEDENT (Ch. 4 
 
 In support of this position the case of Bank v. Hagner, 1 Pet. 455, 
 465, 7 L. Ed. 219, is cited. It was there said that the inclination of 
 the courts strongly favors as obviously just that construction of con- 
 tracts which makes the covenants or promises of the parties depend- 
 ent, rather than independent. After observing that the seller ought not 
 to be compelled to part with his property without receiving the con- 
 sideration, nor the purchaser to part with his money, without an equiv- 
 alent in return, the court said : "Hence, in such cases, if either a ven- 
 dor or a vendee wish to compel the other to fulfill his contract, he 
 musf make his part of the agreement precedent, and cannot proceed 
 against the other without an actual performance of the agreement on 
 his part, or a tender or refusal." 
 
 But it is clear, as said in Railroad Co. v. Howard, 13 How. 307, 339. 
 14 L. Ed. 157, that -covenants are to be considered dependent or in- 
 dependent, according to the intention of the parties, to be deduced 
 from the whole instrument. It is manifest that the covenant of the 
 plaintiff in relation to the transfer of stock in the Brush Electric Light 
 & Power Company is wholly independent of the agreement in relation 
 to the machine, dial, and lamps, in question. The consideration for 
 such transfer, and for the settlement and satisfaction of all claims 
 due by Pollak & Co. and by the Brush Electric Light & Power Com- 
 pany to the plaintiff, was the payment by Pollak of a certain amount, 
 part in cash on the execution of the agreement of November 13, 1883, 
 and the balance on the 1st of Januaiy, 1884. On the other hand, the 
 consideration for Pollak's agreement to pay, in a certain contingency, 
 a specified sum for the machine, dial, and lamps, was his becoming 
 the absolute owner of those articles, upon the happening of that con- 
 tingency. The cost of the articles was fixed by the agreement at a 
 certain aggregate sum, without reference to the transfer of the above- 
 mentioned stock. There is nothing whatever in the contract indicat- 
 ing that the pajntnent for the machine, dial, and lamps was to depend, 
 in any degree, upon the transfer of the stock, or that the transfer of 
 the stock was to depend upon the adoption of the Brush electric light 
 by the city. The covenants weire wholly independent ; and therefore 
 it was not essential to the plaintiff's right to recover that it should al- 
 lege or prove that its agreement to transfer or have transferred to the 
 defendant the above-described stock had been performed. That may . 
 be the subject of a separate suit. 
 
 As the court below correctly interpreted the agreement between the 
 parties, and as the evidence showed that the contingency happened 
 which entitled the plaintiff to recover the sum specified in the agree- 
 ment as the value of the property, the direction to the jury to find for 
 the plaintiff was right. Goodlet v. Railroad Co., 122 U. S. 391, 7 Sup. 
 Ct. 1254, 30 L. Ed. 1230; Kane v. Railroad Co., 128 U. S. 91, 9 Sup. 
 Ct. 16, 32 L. Ed. 339. The judgment. is affirmed." 
 
 «^ Where the parties have made two. separate contracts for the sale of coal, 
 the breach of one does not justify the injured party in refusing to perform the 
 other. Hanson & Parker v. Wittenberg. 205 Mass. 319, 91 N. E. 383 (1910). 
 
Sec. 2) INSTALLMENT CONTRACTS 567 
 
 SIMPSON et al. v. CRIPPIN et al. 
 (In the Court of Queen's Bench, 1S72. L. E. 8 Q. B. Cas. 14.) 
 
 Declaration on a contract to supply from 6,000 to 8,000 tons of 
 coal, to be delivered in equal monthly quantities during tlie period of 
 twelve months, from the 1st of July, 1871. Breach, that the defend- 
 ants did not deliver the coal monthly, and had refused wholly to de- 
 liver the coal and to perform the contract. 
 
 Plea, inter alia : that the plaintiffs were not ready and willing to ac- 
 cept the coals, and that the defendants were prevented from deliver- 
 ing the coals, and performing the agreement, by the acts, neglects, 
 and defaults of the plaintiffs. 
 
 At the trial before Lush, J., at the Liverpool Spring Assizes, 1872, 
 it appeared that the defendants were coal proprietors, and the plain- 
 tiffs were coal merchants. On the 10th of June 1871, the plaintiffs 
 wrote to the defendants the following letter: ''Vv'e agree to take 
 from you about 6,000 to 8,000 tons of your best Wigan four-feet coal, 
 at 5 s. 6d. per ton of 21 cwt. to the ton, put into our wagons at the 
 colliery. Delivery to commence from the 1st of July next, and to be 
 taken in about eqxial monthly quantities over the next twelve months. 
 It is understood that you are not bound to supply in case of accidents 
 or strikes. Terms, cash monthly, less 21/^ % discount." 
 
 The defendants, by letter also dated the 10th of June, replied as 
 follows: "We agree to supply you from 6,000 to 8,000 tons of oui* 
 best four-feet Wigan coal, properly screened, and free from slack, to 
 be delivered into your wagons at our collieries, in equal monthly quan- 
 tities during the period of twelve months from the 1st of July next — 
 strikes of our workmen, accidents, and other circumstances beyond 
 our control excepted — at 5s. 6d. per ton of 21 cwt. Terms, cash 
 monthly, less 2^/2% discount." 
 
 On the 8th of July the defendants wrote, complaining that the 
 first week for the fulfilment of the contract had terminated without 
 the plaintiffs sending wagons or orders for coals. The correspondence 
 continued, the defendants requesting that wagons might be sent and 
 the plaintiffs promising to comply. During the month of July the 
 plaintiffs took from the defendants only 158 tons of coal. On the 
 1st of August the defendants wrote to the plaintiffs, that inasmuch 
 as the latter had only taken 158 tons during tlie month of July, and 
 as the sole inducement for the defendants to entertain the contract 
 was the regular and punctual withdrawal by the plaihtiffs of the stip- 
 ulated quantity during the summer months, which they had failed to 
 perform, the defendants gave notice that the contract was cancelled. 
 On the 2nd of August the plaintiffs replied, stating that they would 
 not allow the contract to be cancelled. 
 
 On these facts the learned judge told the Jury, that as the plaintiffs 
 did not intend to break the contract month by month, and only broke 
 
568 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 it for the first month's delivery, that did not justify the defendants, in 
 point of law, in cancelling the contract, and left the question of dam- 
 ages to them. 
 
 The jury found a verdict for the plaintiffs for £475, leave being 
 reserved to move to enter a verdict for the defendants. 
 
 A rule was afterwards obtained upon the ground that under the 
 circumstances the plaintiffs had disentitled themselves to sue for the 
 breach of the contract, and tliat the defendants were entitled to can- 
 cel the contract, and refuse to deliver the residue of the coal. 
 
 Blackburn, J. I think that the rule ought to be discharged. It can- 
 not be denied that the plaintiffs were bound in every month to send 
 wagons capable of carrying at least 500 tons, and that by failing to 
 perform this term they have committed a breach of the contract; and 
 the question is, whether by this breach the contract was determined. 
 The defendants contend that the sending of a sufficient number of 
 wagons by the plaintiffs to receive the coal was a condition precedent 
 to the continuance of the contract, and they rely upon the terms of 
 the letter of the 1st of August. No sufficient reason has been urged 
 why damages would not be a compensation for the breach by the 
 plaintiffs, and why the defendants should be at liberty to annul the 
 dontraet; but it is said that Hoare v. Rennie, 5 H. &> N. 19, is in 
 point, and that we ought not to go counter to the decision of a court 
 of co-ordinate jurisdiction. It is, however, difficult to understand up- 
 on what principle Hoare v. Rennie was decided. If the principle on 
 which that case was decided is that, wherever a plaintiff has broken 
 his contract first he cannot sue for any subsequent breach committed 
 by the defendant, the decision would be opposed to the authority of 
 many other cases. I prefer to follow Pordage v. Cole, 1 VVms. Saund. 
 319. No reason has been pointed out why the defendants should not 
 have delivered the stipulated quantity of coal during each of the 
 months after July, although the plaintiffs in that month failed to ac- 
 cept the number of tons contracted for. Hoare v. Rennie was ques- 
 tioned in Jonassohn v. Young, 4 B. & S. 296. 
 
 Rule discharged."^ 
 
 MERSEY STEEL & IRON CO., Limited, v. NAYLOR, 
 BENZON & CO. 
 
 (In the House of Lords, 1884. L. K. 9 App. Cas. 434.) 
 
 Appeal from' an order (dated June I3th, 1882) of the Court of 
 Appeal (Jessel, M. R., Eindley and Bowen, L. JJ.) reversing an order 
 of Lord Coleridge, C. J. 
 
 '82 The concurring opinions of Mellor and Lush, JJ., are omitted. See In 
 accord, Samuels v. W. H. Miner Chocolate Co., 235 Mass. 312, 126 N. E. 771 
 (1020). 
 
Sec. 2) INSTALLMENT CONTRACTS 509 
 
 Earl of Selborne, L. C.«' * * * Upon the other point, I do 
 not think it desirable to lay down larger rules than the case may re- 
 quire, or than former authorities may have laid down for my guid- 
 ance, or to go into possible cases diflfering from the one with which 
 we have to deal. I am content to take the rule as stated by Lord 
 , Coleridge in Freeth v. Burr [L. R. 9 C- P. 208], which is in substance, 
 as I understand it, that you must look at the actual circumstances of 
 the case in order to see whether the one party to the contract is re- 
 lieved from its future performance by the conduct of the other; you 
 must examine what that conduct is, so as to see whether it amounts 
 to a renunciation, to an absolute refusal to perform the contract, 
 such as would amount to a rescission if he had the power to rescind, 
 and whether the other party may accept it as a reason for not perform- 
 ing his part ; and I think that nothing more is necessary in the pres- 
 ent case than to look at the conduct of the parties, and see whether 
 anything of that kind has taken place here. Before doing so, how- 
 ever, I must say one or two words in order to show why I cannot ■ 
 adopt Mr. Cohen's argument, as far as it represented the payment 
 by the respondents for the iron delivered as in this case a condi- 
 tion precedent, and coming within the rules of law applicable to con- 
 ditions precedent. If it were so of course there would be an end 
 of the case ; but to me it is plain beyond the possibility of controversy, 
 that upon the proper construction of this contract it is not and cannot 
 be a condition precedent. The contract is for the purchase of 5,000 
 tons of steel blooms of the company's manufacture; therefore it is 
 
 **Part of the opinion of Lord Selborne and also tlie concurring opinions 
 of Lords Blackburn, Bramwell, and Watson are omitted. Withers v. Reynolds, 
 2 B. & Adol. 882 (1831), was expressly distinguished on the ground that there 
 was a repudiation in that case. 
 
 In Freeth t. Burr, L. E. 9 O. P. 208, (1874), there was a contract to sell 
 250 tons pig iron, price payable 14 days after delivery of each instalment. 
 The seller was very dilatory and the buyer feared that the later instalments 
 would not be delivered. The buyer therefore withheld payment on the first 
 instalment to secure himself against loss to be caused by future non-delivery, 
 thinking erroneously that he was privileged to do this. The seller at once 
 repudiated the contract, prices of iron having risen greatly. The buyer sued 
 for damages for non-delivery and was given judgment, the court holding that 
 his failure to pay on time did not "evince an intention no longer to be bound 
 by the contract" and that a mere ijartial failure of performance without any 
 abandonment or repudiation of the contract does not terminate the duty of 
 the other party. 
 
 Of this case Sir Frederick Pollock (Wald's Pollock on Contracts [,Williston's 
 Ed.] 330) says : "As a positive test the rule of Freeth v. Burr is doubtless cor- 
 rect; that is, a party who by declaration or conduct, 'evinces an intention 
 no longer to be bound by the contract,' entitles the other to rescind, and this 
 whether he has or has not, apart from this, committed a breach of the contract 
 going to the whole of the consideration. But it seems doubtful whether the 
 test will hold negatively. Can an intention to repudiate the contract be neces- 
 sary as well as suflBcient to constitute a total and irreparable breach? Can 
 there not be, without any such intent.- a failure in a vital part of the perr 
 formance which destroys the benefit of the contract as a whole? * * * 
 All that the authorities require of us is not to presume delay in payment, as 
 distinguished from delivery, to be in itself a total breach.'' 
 
570 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 one contract for the purchase oif that quantity of steel blooms. No 
 doubt there are subsidiary terms in the contract, as to the time of 
 delivery, "Delivery 1,000 tons monthly commencing January next;" 
 and as to the time of payment, "Payment, net cash within three days 
 after receipt of shipping documents ;" but that does not split up the 
 contract into afi many contracts as there shall be deliveries for the 
 purpose, of so many distinct quantities of iron. It is quite consist- 
 ent with the natural meaning of the contract, that it is to be one 
 contract for the purchase of that quantity of iron, to be delivered 
 at those times and in that manner, and for which payment is so to 
 be made. It is perfectly clear that no particular payment can be 
 a condition precedent of the entire contract, because the delivery un- 
 der the contract was most certainly to precede payment; and that 
 being so, I do not see how, without express words, it can possibly 
 be made a condition precedent to the subsequent fulfilment of the 
 unfulfilled part of the contract, by the delivery of the undelivered 
 steel. 
 
 But quite consistently with that view, it appears to me, accord- 
 ing to the authorities and according to sound reason and principle, 
 that the parties might have so conducted themselves as to release 
 each other from the contract, and that one party might have so con- 
 ducted himself as to leave it at the option of the other party to re- 
 lieve himself from a future performance of the contract. The ques- 
 tion is whether the facts here justify that conclusion? Now the facts 
 relied vipon, without reading all the evidence, are these. The com- 
 pany at the time when the money was about to become payable for 
 the steel actually delivered fell into difficulties, and a petitioti was pre- 
 sented against them. There was a section in the Companies Act 
 1862 (§ 153), which appeared to the advisers of the purchasers to 
 admit of the construction, that until in those circumstances the peti- 
 tion was disposed of by an order for the company to be wound up 
 or otherwise, there would be no one who could receive, and could 
 give a good discharge for, the amount due. There is not, upon the 
 letters and documents, the slightest ground for supposing either that 
 the purchasers coulc} not pay, or that they were unwilling to pay, the 
 amount due ; but they acted as they did, evidently bona fide, because 
 they doubted, on the advice of their solicitor, whether that section 
 of the act, as long as the petition was pending, did not make it im- 
 possible for them to obtain the discharge to which they had an un- 
 questionable right. And therefore the case which I put during the 
 argument is analogous to that which according to the advice they re- 
 ceived they supposed to exist — ^namely, the case of a man who has 
 died between the delivery a:nd the time when payment ought to be 
 made, he being the only person to whom payment is due; and of 
 course until there is a legal personal representative of that person 
 no receipt can be given for the money. By the Act of Parliament, in 
 
. Sec. 2) INSTALLMENT CONTRACTS 571 
 
 the event of a winding-up order being made, it would 'date from the 
 time when the petition was presented; and this clause, which no 
 doubt, according to its true construction, oiily deals with alienations 
 of the property of the company, was supposed by the solicitor of the 
 purchasers to make it questionable whether the payment of a debt 
 due to the company, to the persons who if there had been no peti- 
 tion would have had a right to receive it, might not be held, in the 
 event of a winding-up order being made, to be a payment of the 
 property of the company to a wrong person and therefore an aliena- 
 tion. I cannot ascribe to their conduct, under these circumstances, 
 the character of a renunciation of the contract, a repudiation of the 
 contract, a refusal to fulfil the contract. It is just the reverse; the 
 purchasers were desirous of fulfilling the contract; they w^re ad- 
 vised that there was a difficulty in the way, and they expressed 
 anxiety that that difficulty should be as soon as possible removed, 
 by means which were suggested to them, and which they pointed 
 out to the solicitors of the company. The company evidently took 
 up the attitude, in that state of things, of treating the default as one 
 which released them from all further obligation. On February 10th, 
 which was before the winding-up order was made, and while that 
 state of things still continued, the company by their secretary wrote 
 to say that they thought (being 50 far correct and thinking rightly) 
 that the objection was not well founded in law ; and they added : 
 "We shall therefore consider your refusal to pay for the goods already 
 delivered as a breach of contract on your part and as releasing us 
 from any further obligations on our part." I think that they were 
 wrong in that conclusion, and that there is no principle deducible 
 from any of the authorities which supports that view of such — I hardly 
 like to call it a refusal— «>of such a demur, such a delay or postpone- 
 ment, imder those circumstances. 
 
 The company, until they were wound up, never receded from that 
 position which they took up on February lOth, 1881 ; and it appears 
 to me to be clear that the liquidator adopted it, and never departed 
 from it, and that the repudiation of the contract on insufficient 
 grounds on the part of the company, which had taken place while the 
 petition was pending and before the winding-up order was made, was 
 adhered to after the winding-up order was made, on the part of the 
 liquidator. On the other hand, it seems to me that, fairly and rea- 
 sonably considered, the conduct of the respondents was justifiable. 
 Upon February 17th, 1881, after the making of the winding-up order, 
 they state, that there are instalments which ought to have been de- 
 livered, but which have not been delivered, in respect of which they 
 would have a claim for damages, and that they apprehend that they 
 would have a right to deduct those damages from any payments then 
 due from them; and, according to the view which has been taken in 
 the Court of Appeal of the effect of § 10 of the Act of 1875, and in 
 
572 IMPLIED AND CONSTRUCTIVE CONDITIONS PEECEDENT (Ch. 4 
 
 which view I believe your I^ordships agree^ that was the right way 
 of looking at the matter. Then the respondents go on to say, that they 
 are prepared to accept all deliveries which the liquidator may make 
 under the contract, and to pay everything due, only requesting that 
 those payments may be considered as made upon this understanding, 
 in substance, that the right to the set-off which exists in law for the 
 damages shall not be prejudiced — a perfectly reasonable, defensible, 
 and justifiable proposal. And the solicitor who writes the letter 
 adds, "Or I think it probable that my clients would consent to accept 
 delivery now and waive the damages," a thing which in a later letter 
 they express their willingness to do. In my judgment, they' have 
 not in any portion of the proceeding acted so as to show, an intention 
 to renounce or to repudiate the contract, or to fail in its perform- 
 jmce on their part. 
 
 Therefore I think that the judgment of the Court below is right, 
 and that this appeal should be dismissed with costs, and I so move 
 your Lordships. 
 
 NORRINGTON v. WRIGHT et al, 
 
 (Supreme Court of the United States, 1885. 115 U. S. 188, 6 Sup. Ct. 12, 29 
 
 L. Ed. 366.) 
 
 • 
 
 Gray, J. This was an action of assumpsit, brought by Arthur Nor- 
 rington, a citizen of Great Britain, trading under the name of A. Nor- 
 rington & Co., against James A. Wright and others, citizens of Penn- 
 sylvania, trading under the name of Peter Wright & Sons, upon the 
 following contract: 
 
 "Philadelphia, January 19, 1880. 
 
 "Sold to Messrs. Peter Wright & Sons, for account of A. Norring- 
 ton & Co., London : Five thousand (5,000) tons old T iron rails, for 
 shipment from a European port or ports, at the rate of about one 
 thousand (1,000) tons per month, beginning February, 1880, but' 
 whole contract to be shipped before August 1, 1880, at forty-five dol- 
 lars ($45.00) per ton of 2240 lbs. customhouse weight, ex ship Phil- 
 adelphia. Settlement, cash, on presentation of bills accompanied by 
 custom-house certificate of weight. Sellers to notify buyers of ship- 
 ments with vessels' names as soon as known by them. Sellers not to 
 be compelled to replace any parcel lost after shipment. Sellers, when 
 possible, to secure to buyers right to name discharging berth of ves- 
 sels at Philadelphia. Edward J. Etting, Metal Broker." 
 
 The declaration contained three countSv The first count alleged the 
 contract to have been for the sale of about 5,000 tons of T iron rails, 
 to be shipped at the rate of about 1,000 tons a month, beginning in 
 February, and ending in July, 1880. The second count sets forth the 
 contract verbatim. Each of these two counts alleged that the plain- 
 tiffs in February, March, April, May, June, and July shipped the 
 
Sec. 2) INSTALLMENT CONTRACTS 573 
 
 goods at' the rate of about 1,000 tons a month, and notified the ship- 
 ments to the defendants; and further alleged the due arrival of the 
 goods at Philadelphia, the plaintiff's readiness to deliver the goods and 
 bills thereof, with custom-house certificates of weight, according to 
 the contract, and the defendants' refusal to accept them. The third 
 count differed from the second only in averring that 400 tons were 
 shipped by the plaintiff in February and accepted by the defendants, 
 and that the rest was shipped by the plaintiffs, at the rate of about 
 1,000 tons a month, in March, April, May, June, and July. The de- 
 fendants pleaded non assumpsit. The material facts proved at the 
 trial were as follows : 
 
 The plaintiff shipped from various European ports 400 tons by one 
 vessel in the last part of February, 885 tons by two vessels in March, 
 1,571 tons by five vessels in April, 850 tons by three vessels in May, 
 1,000 tons by two vessels in June, and 300 tons by one vessel in July, 
 and notified to the defendants each shipment. The defendants receiv- 
 ed and paid for the February shipment upon its arrival in March, and 
 in April gave directions at what wharves the March shipments should 
 be discharged on their arrival ; but on May 14th, about the time of the 
 arrival of the March shipments, and having been then for the first 
 time informed of the amounts shipped in February, M'arch,- and April, 
 they gave Etting written notice that they should decline to accept 
 the shipments made in March and April, because none of them were 
 in accordance with the contract; and in answer to a letter from him 
 of May 16th, wrote him on May 17th, as follows: "We are advised 
 that what has occurred does not amount to an acceptance of the iron 
 under the circumstances, and the terms of the contract. You had 
 a right to deliver in parcels, and we had a right to expect the stipu- 
 lated quantity would be delivered until the time was up in which that 
 was possible. Both delivering and receiving were thus far conditional 
 on there being thereafter a complete delivery in due time and of 
 the stipulated article. ■ On the assumption that this time had arrived, 
 and that you had ascertained that you did not intend to, or could not, 
 make any further deliveries for the February and March shipments, 
 we gave you the notice that we declined accepting those deliveries. 
 As to April, it is too plain, we suppose, to require any remark. If 
 we are mistaken as to our obligation for the February and March 
 shipments, of course we must abide the consequences; but if we are 
 right, you have not performed your contract, as you certainly have 
 not for the April shipments. There is then the very serious and much 
 debated question, as we are advised, whether the failure to make the 
 stipulated shipments in February or March has absolved us from the 
 contract. If it does, we of course will avail ourselves of this advan- 
 tage." 
 
 On May 18th Etting wrote to the defendants, insisting on their 
 liability for both past and future shipments, and saying, among other 
 things : "In respect to the objection that there had not been a complete 
 
574 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 delivery in due time of the stipulated article, I beg to call your attention 
 to the fact that while the contract is for five thousand tons, it expressly 
 stipulates that deliveries may be made during six months, and that they 
 are only to be at the -rate of about one thousand tons per month." 
 "As to April, while it seems to me 'too plain to require any remark,' I 
 do not see how it can seem so to you, unless you intend to accept the 
 rails. If you object to taking all three shipments made in that month, 
 I shall feel authorized to deliver only two of the cargoes, or, for that 
 matter, to make the delivery of precisely one thousand tons. But 
 I think I am entitled to know definitely from you whether you intend 
 to reject the April shipments, and, if so, upon what ground, and also 
 whether you are decided to reject the remaining shipments under 
 the contract. You say in your last paragraph that you shall avail 
 yourselves of the advantage, if you are absolved from the contract; 
 but, as you seem to be in doubt whether you can set up that claim or 
 not, I should like to know definitely what is your intention." 
 
 On May 19th the defendants replied : "We do not read the contract 
 as you do. We read it as stipulating for monthly shipments of about 
 one thousand tons, beginning in February, and that the six months' 
 clause is to secure the completion of whatever had fallen short in the 
 five months. . As to the meaning of 'about,' it is settled as well as such a 
 thing can be; and certainly neither the February, March, nor April 
 shipments are within the limits. As to the proposal to vary the notices 
 for April shipments, we do not think you can do this. The notice 
 of the shipments, as soon as known, you were bound to give, and cannot 
 afterwards vary it if they do not conform to the contract. Our right 
 to be notified immediately that the shipments were known is as mate- 
 rial a provision as any other, nor can it be changfcd now in order to 
 make that a performance which was no performance within the time 
 required." "You ask us to determine whether we will or will not ob- 
 ject to receive further shipments because of past defaults. We tell 
 you we will if we are entitled to do so, and will not if we are not en- 
 titled to do so. We do not think you have the right to compel us to de- 
 cide a disputed question of law to relieve you from the risk of deciding 
 it yourself. You know quite as well as we do what is the rule and its 
 uncertainty of application." On June 10th Etting offered to the defend- 
 ants the alternative of delivering to them one thousand tons strict meas- 
 ure on account of the shipments in April. This offer they immediately 
 declined. On June 15th Etting wrote to the defendants that two car- 
 goes, amounting to 221 tons, of the April shipments, and two cargoes, 
 amounting to 650 tons, of the May shipments, (designated by the names 
 of the vessels,) had been erroneously notified to them, and that about 900 
 tons had been shipped by a certain other vessel on account of the May 
 shipments. On the same day the defendants replied that the notifi- 
 cation as to April shipments could not be corrected at this late date, 
 and after the terms of the contract had long since been broken. From 
 the date of the contract to the time of its rescission by the defendants, 
 
Sec. 2) INSTALLMENT CONTEACTS 575 
 
 the market price of such iron was lower than that stipulated in the 
 contract, and was constantly falling. After the arrival of the cargoes, 
 and their tender and refusal, they were sold by Etting, with the consent 
 of the defendants, for the benefit of whom it might concern. 
 
 At the trial the plaintiff contended (1) that under the contract he had 
 six months in which to ship the S,0(X) tons, and any deficiency in the 
 earlier months could be made up subsequently, provided that the de- 
 fendants could not be required to take more than 1,000 tons in any one 
 month; (2) that, if this was not so, the contract was a divisible con- 
 tract, and the remedy of the defendants for a default in any month 
 was -not by rescission of the whole contract, but only by deduction 
 of the damages caused by the delays in the shipments on the part of 
 the plaintiff. But the court instructed the jury that if the defendants, 
 at the time accepting the delivery of the cargo paid for, had no notice 
 of the failure of the plaintiff to ship about 1,000 tons in the month of 
 February, and immediately upon learning that fact gave notice of 
 their intention to rescind, the verdict should be for them. The plain- 
 tiff excepted to this instruction, and, after verdict and judgment for 
 the defendants, sued out this writ of error. 
 
 In the contracts of merchants, time is of the essence. The time of 
 shipment is the usual and convenient means of fixing the probable 
 time of arrival, with a view of providing funds to pay for the goods, or 
 of fulfilling contracts with third persons. A statement descriptive 
 of the subject-matter, or of some material incident, such as the time 
 or place of shipment, is ordinarily to be regarded as a warranty in 
 the sense in which that term is used in insurance and maritime law, 
 that is to say, a condition precedent upon the failure or non-perform- 
 ance of which the party aggrieved may repudiate the whole contract. 
 Behn v. Burness, 3 Best & S. 751 ; Bowes v. Shand; 2 App. Cas. 455 ; 
 Lowber v. Bangs, 2 Wall. 728, 17 ly. Ed. 768; Davison v. Von Lingen, 
 113 U. S. 40, 5 Sup. Ct. 346, 28 L. Ed. 885. 
 
 The contract sued on is a single contract for the sale and purchase 
 of 5,000 tons of iron rails, shipped from a European port or ports for 
 Philadelphia. The subsidiary provisions as to shipping in different 
 months, and as to paying for each shipment upon its delivery, do not 
 split up the contract into as many contracts as there shall be shipments, 
 or deliveries of so many distinct quantities of iron. Mersey S. & I. 
 Co. v. Naylor, 9 App. Cas. 434, 439. The further provision that the 
 sellers shall not be compelled to replace any parcel lost after ship- 
 ment, simply reduces, in the event of such a loss, the quantity to be 
 delivered and paid for. The times of shipment, as designated in 
 the contract, are "at the rate of about 1,000 tons per month, beginning 
 February, 1880, but whole contract to be shipped before August 
 1, 1880." These words are not satisfied by shipping one-sixth part 
 of the 5,000 tons, or about 833 tons, in each of the six months which 
 begin with February and end with July. But they require about 1,000 
 tons to be shipped in each of the five months from February to June 
 
576 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 inclusive, and allow no more than slight and unimportant deficiencies 
 in the shipments during those months to be made up in the month of 
 July. The contract is not one for the sale of a specific lot of goods, 
 identified by independent circufnstances, — such as all those deposited 
 in a certain warehouse, or to be shipped in a particular vessel, or that 
 may be manufactured by the seller, or may be required for use by the 
 buyer, in a certain mill, — in which case the mention of the quantity, 
 accompanied by the qualification of "about," or "more or less," is re- 
 garded as a mere estimate of the probable amount, as to which good 
 faith is all that is required of the party making it. But the contract be- 
 fore us comes' within the general rule : "When no such independent cir- 
 cumstances are referred to, and the engagement is to furnish goods of 
 a certain quality or character to a certain amount, the, quantity specified 
 is material, and governs the contract. The addition of the qualifying 
 words 'about,' 'more or less,' and the like, in such cases, is only for the 
 purpose of providing against accidental variations arising from slight 
 and unimportant excesses or deficiencies in number, measure, or 
 weight." Brawley v. United States, 96 U. S. 168, 171, 172, 24 L,. Ed. 
 622. The seller is bound to deliver the quantity stipulated, and has 
 no right either to compel the buyer to accept a less quantity, or to re- 
 quire him to select part out of a greater quantity; and when the goods 
 are to be shipped in certain proportions monthly, the seller's failure 
 to ship the required quantity in the first month gives the buyer the 
 same right to rescind the whole contract that he would have had if 
 it had been agreed that all the goods should be delivered at once. 
 
 The plaintiff, instead of shipping about 1,000 tons in February 
 and about 1,000 tons in March, as stipulated in the contract, shipped 
 only 400 tons in February, and 885 tons in March. His failure to 
 fulfill the contract on his part in respect to these first-two installments 
 justified the defendants in rescinding the whole contract, provided 
 they distinctly and seasonably asserted the right of rescission. The 
 defendants, immediately after the arrival of the March shipments, and 
 as soon as they knew that the quantities which had been shipped in 
 February and in March were less than the contract called for, clearly 
 and positively asserted the right to rescind, if the law entitled them 
 to do so. Their previous acceptance of the single cargo of 400 tons 
 shipped in February was no waiver of this right, because it took place 
 without notice or means of knowledge that the stipulated quantity 
 had not been shipped in February. The price paid by them for that 
 cargo being above the market value, the plaintiff suffered no injury 
 by the omission of the defendants to return the iron ; and no reliance 
 was placed on that omission in the correspondence between the parties. 
 
 The case wholly differs from that of Lyon v. Bertram, 20 How. 
 149, 15 L. Ed. 847, in which the buyer of a specific lot of goods ac- 
 cepted and used part of them with full means of previously ascertain- 
 ing whether they conformed to the contract. The plaintiff, denying 
 the defendants' right to rescind, and asserting that the contract was 
 
Sec. 2) INSTALLMENT CONTRACTS ,57 7 
 
 still in force, was bound to show such performance on his part as 
 entitled him to demand performance on their part, and, having failed 
 to do so, cannot maintain this, action. 
 
 For these reasons we are of opinion that the judgment below should 
 be affirmed. But as much of the argunient at the bar was devoted 
 to a discussion of the recent English cases, and as a diversity in the 
 law, as administered on the two sides of the Atlantic, concerning the 
 interpretation and effect of commercial contracts of this kind, is 
 greatly to be deprecated, it is proper to add that upon a careful exami- 
 nation of the cases referred to they do not appear to us to establish 
 any rule inconsistent with our conclusion. 
 
 In the leading case of Hoare v. Rennie, 5 Hurl. & N. 19, which was an 
 action upon a contract of sale of 667 tons of bar iron,, to be shipped 
 from Sweden in June, July, August, and September, ^nd in about equal 
 portions each month, at a certain price payable on delivery, the declara- 
 tion alleged that the plaintiffs performed all things necessary to entitle 
 them to have the contract performed by the defendants, and were 
 ready and willing to perform the contract on their part, and in June 
 shipped a certain portion of the iron, and within a reasonable time aft- 
 erwards offered to deliver to' the defendants the portion so shipped,, 
 but the defendants refused to receive it, and gave notice to the plain- 
 tiffs that they would not accept the rest. The defendants pleaded that 
 the shipment in June was of about 20 tons only, and that the plaintiffs 
 failed to complete the shipment for that month according to the con- 
 tract. Upon demurrer to the pleas, it was argued for the plaintiffs that 
 the shipment of about one- fourth of the iron in each month was not a 
 condition precedent, and that the defendants' Only remedy for a failure 
 to ship that quantity was by' a cross-action. But judgment was given 
 for the defendants, Chief Baron Pollock saying: "The defendants 
 refused to accept the first shipment, because, as they say, it was not a 
 performance, but a breach of the contract. Where parties have made 
 an agreement for themselves, the courts ought not to make another for 
 them. Here they say that, in the events' that have happened, one- 
 fourth shall be shipped in each month, and we cannot say that they 
 meant to accept any other quantity. , At the outset the plaintiffs failed 
 to tender the quantity according to the contract, — -they tendered a much 
 less quantity. The defendants had a right to say that this was no per- 
 formance of the contract, and they were no more botind to accept the 
 short quantity than if a single delivery had been contracted for. There- 
 fore the pleas are an answer to the action." 5 Hurl. & N. 28. So in 
 Coddington v. Paleologo, I,. IJ.. 2 Exch. 193, while there was a division 
 of opinion upon the question whether a contract to sUpply goods, "de- 
 livering on April 17th, complete 8th May," bound the seller to begin 
 delivering on April 17th, all the judges agreed that if it did, and the 
 seller made no delivery on that day, the buyer might rescind the con- 
 tract. 
 
 CORBIN CONT. — 37 
 
578 IMPLIED AND CONSTRUCTIVE CONDITIONS PEECBDENT (Ch. 4 
 
 I 
 
 On the other hand, in Simpson v. Crippin, L. R. 8 Q. B. 14, under a 
 contract to supply from 6,600 to 8,000 tons of coal, to be taken by the 
 buyer's wagons from the seller's colliery in equal monthly quantities 
 for 12 months, the buyer sent wagons for only 150 tons during the first 
 month ; and it was held that this did not entitle the seller to annul the 
 contract and decline to deliver any more coal, but that his only reinedy 
 was by an action for damages. And in Brandt v. Lawrence, 1 Q. B. 
 Div. 344, in which the contract was for the purchase of 4,500 quarters, 
 10 per cent, more or less, of Russian oats, "shipment by steamer or 
 steamers during February," or, in case of ice preventing shipment, then 
 immediately upon the opening of navigation, and 1,139 quarters were 
 shipped by one steamer in time, and 3,361 quarters were shipped too 
 late, it was held that the buyer was bound to accept the 1,139 quarters, 
 and was liable to an action by the seller for refusing to accept them. 
 Such being the condition of, the law of England as declared in the lower 
 courts, the case of Bowes v. Shand, after conflicting decisions in the 
 Queen's Bench Division and the Court of Appeal, was finally determined 
 by the House of Lords. 1 Q. B. Div. 470; 2 Q. B. Div. 112 ; 2 App. Cas. 
 455. In that case, two contracts were made in London, each for the sale 
 of 300 tons of "Madras rice, to be shipped at Madras or coast for this 
 port during the months of March ^°/ April, 1874, per Rajah of Cochin." 
 The 600 tons filled 8,200 bags, of which 7,120 bags were put on board, 
 and bills of lading signed in February; and for the rest, consisting. of 
 1,030 bags put on boa.rd in Februaryj and SO in March, the bill of lading 
 was signed in March. At the trial of an action by the seller against the 
 buyer for refusing to accept the cargo, evidence was given that rice 
 shipped in February would be the spring crop, and quite as good as rice 
 shipped in March or April. Yet the House of Lords held that the ac- 
 tion could not be maintained, because the meaning of the contract, as 
 apparent upon its face, was that all the rice must be put on board in 
 March and April, or in one of those months. In the opinions there de- 
 livered the general principles underlying this class of cases, are most 
 clearly and satisfactorily stated. It will be, sufficient to quote a few 
 passages from two of those opinions. 
 
 Lord Chancellor Cairns said: "It does not appear to me to be a 
 question for your lordships, or for any court, to consider whether that 
 is a contract which bears upon the face of it some reason, some explana- 
 tion, why it was made in that form, and why the stipulation is made that 
 the shipment should be during these particular months. It is a mercan- 
 tile contract, and merchants are not in the habit of placing upon their 
 contracts stipulations to which they do tiot attach some value and im- 
 portance." 2 App. Cas. 463. "If it be admitted that the literal inean- 
 ing would imply that the whole quantity must be put on board during 
 a specified time,, it is no answer to that literal meaning, — it, is no observa- 
 tion which can dispose of, or get rid of, or displace, that literal meaning, 
 — to say that it puts an additional burden On the seller without, a cor- 
 
Sec.' 2) INSTALLMENT CONTRACTS 579 
 
 responding benefit to the purchaser; that is a matter of which the seller 
 and purchaser are the best judges. Nor is it any reason for saying that 
 it would be a means by which purchasers, \Anitliout apy real cause, would 
 frequently obtain an excuse for rejecting contracts when prices had 
 dropped. The non-fulfillment of any term in any contract is a means 
 by which a purchaser is able to get rid of the contract when prices have 
 dropped ; but that is no reason why a term which is found in a contract 
 should not be fulfilled." Pages 465, 466. "It was suggested that^ even 
 if the construction of the contract be as I have stated, still if the rice 
 was not put on board in the particular ftonths, that would not be a 
 reason which would justify the appellants In having rejected the rice 
 altogether, but that it might afford a ground for a cross-action by them 
 if they could show that any particular damage resulted to tliem from 
 the rice not having been put, on board in the months in question. My 
 lords, I cannot think that there is any foundation whatever for that 
 argiiment. If the construction of the contract be as I have said, that it 
 bears that the rice is to be put, on board in the months in question, that 
 is part, of the description of the subject-matter of what is sold. What 
 is sold is not 300 tons of rice in gross or in general. It is 300 tons of 
 Madras rice to be put on board at Madras during the particular 
 months." "The plaintiff, who sues upon that contract, has not launched 
 his case until he has shown that he has tendered that thing which has 
 been contracted for, and if he is unable to show that, he cannot cl^im 
 any damages for the non-fulfillment of the contract." Pages 467, 468. 
 I^ord Blackburn said: "If the description of the article tendered 
 is different in any respect, it is not the article bargained for, and the 
 other party is not bound to take it. I think in this case what the parties 
 bargained for was rice, shipped at Madras or the coast of Madras. 
 Equally good ,rice might have been shipped a little to the north or a 
 little to the sout^ of the coast -of Madras. I do not quite know what the 
 boundary is, and probably equally good rice might have been shipped 
 in February as was shipped in March, or equally good rice might have 
 been shipped in May as was shipped in April, and I dare say equally 
 good rice might have been put on boa.rd'another ship as that which was 
 put on board the Rajah of Cochin. But the parties have chosen, for 
 reasons best known to themselves, to say : We bargain to take rice, 
 shipped in this particular region, at that particular time, on board that 
 particular ship ; and before the defendants can be compelled to take 
 anything in fulfillment of that contract it must be shown not merely 
 that it, is equally good, but that it is the same article as they have bar- 
 gained for, otherwise they are not bound to take it." 2 App. Cas. 480, 
 
 481. ■ ■ 
 
 Soon after that decision of the House of Lords, two cases were deter- 
 mined in the Court of Appeal. In Peuter v. Sala, 4 C. P. Div. 239, un- 
 der a contract for the sale of "about 25 tons (more or less) black pep- 
 per, October ^^'^ November shipment, from Penang to London, the 
 name of the vessel or vessels, marks, and full particulars to be declared 
 
580 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 to the buyer in writing within 60 days from date of bill of lading," the 
 seller, within the 60 days, declared 25 tons by a particular vessel, of 
 which only 20 tons were shipped in November, and five tons in Decem- 
 ber ; and It was held that the buyer had the right to refuse to receive 
 any part of the pepper. In Honck v. Multer, 7 Q. B. Div. 92, under a 
 contract for the sale of 2,000 tons of pig-iron, to be delivered to the 
 buyer free on board at the maker's wharf "in November, or equally 
 over November, December, and January next," the buyer failed to take 
 any iron in November, but demanded delivery of one- third in Decem- 
 ber and one-third in Januar/i and it was held that the seller was jus- 
 tified in refusing to deliver, and in giving notice to the buyer that he con- 
 sidered the contract as canceled by the buyer's not taking any iron in 
 November. 
 
 The plaintiff in the case at bar greatly relied on the very recent de- 
 cision of the House of Lords in Mersey Co. v. Naylor, 9 App. Cas. 434, 
 affirming the judgment of the CoUrt of Appealin 9 Q. B. Div. 648, and 
 following the decision of the Court of Common Pleas in Freeth v. Burr, 
 L. R. 9 C. P. 208. But the point there decided was that the failure of 
 the buyer to pay for the first installment of the goods upon delivery 
 does not, unless the circumstances evince an intention on his part to be 
 no longer bound by the contract, entitle the seller to rescind the contract, 
 and to decline to make further deliveries under it. And the grounds of 
 the' decision, as stated by Lord Chancellor Sdborne in moving judg- 
 ment in the House of Lords, are applicable only to the case of a failure 
 of. the buyer to pay for, and not to that of a failure of the seller to de- 
 liver, the first installment. The Lord Chancellor said : "The contract is 
 for the purchase of 5,000 tons of steel blooms of the company's manu- 
 facture, therefore, it is one contract for the purchase of that quantity 
 of steel blooms. No doubt, there are subsidiary terms in the contract, 
 as to the time of delivery,— 'delivery 1,000 tons monthly, commencing 
 January next,' — ^ahd as to the time of payment, — ^'payment net cash 
 within three days after receipt of shipping documents,' — ^but that does 
 not split up the contract into ^s many contracts as there shall be de- 
 liveries for the purpose of so many distinct quantities of iron. It is 
 quite consistent with the natural meaning of the contract tliat it is to 
 be one contract for the purchase of that quantity of iron to be delivered 
 at those times and in that manner, and for which payment is so to be 
 made. It is perfectly clear that no particular payment can be a condi- 
 tion precedent of the entire contract, because the delivery under the 
 contract was most certainly to precede payment; and that being so, I 
 do not see how, without express words, it can possibly be made a. 
 condition precedent to the subsequent fulfillment of the unfulfilled part 
 of the contract by the delivery of the undelivered steel." 9 App. Cas. 
 439. 
 
 Moreover, although in the Court of Appeal dicta were uttered tending 
 to approve the decision in Simpson v. Crippin, and to disparage the de- 
 cisions in Hoare v. Rennie and Honck v. MUller, above cited, yet in the 
 
Sec. 2) INSTALLMENT CONTKACTS 5S1 
 
 House of Lords Simpson v. Crippin was not even referred to, and lyord 
 Blackburn, who had given the leading opinion in that case, as well as 
 Lord Bramwell, who had delivered the leading opinion in Honck v. 
 Muller, distinguished Ploare v. Rennie and Honck v. MuUer from the 
 case in judgment. 9 App. Cas. 144, 446. 
 
 Upon a review of the English decisions, the rule laid down in the 
 earlier cases of Hoare v. Rennie and Coddington v. Paleologo, as well 
 as in the later cases of Renter v. Sala and Honck v. Muller, appears to 
 us to be supported by a greater weight of authority than the rule stated 
 in the intermediate cases of Simpson v. Crippin and Brandt v. Law- 
 rence, and to accord better with the general principles affirmed by the 
 House of Lords in Bowes v. Shand, while it in no wise contravenes the 
 decision of that tribunal in Mersey Co. v. Naylor. In this country 
 there is less judicial authority upon the question. The two cases most 
 nearly in point that have come to our i notice are Hill v. Blake, 97 N. 
 Y. 216, which accords with Bowes v. Shand and King Philip Mills v. 
 Slater, 12 R. I. 82, 34 Am. Rep. 603, which approves and follows Hoare 
 v. Rennie. The recent cases in the supreme court of Pennsylvania, cited 
 at the bar, support no other conclusion. In Shirm v. Bodine, 60 !Pa. 
 182, 100 Am. Dec. 560, the point decided was that a contract for the 
 purchase of 800 tons of coal at a certain price per ton, "coal to be de- 
 livered on board vessels as sent for during the months of August and 
 September," was an entire contract, under which nothing was payable 
 until delivery of the whole, and therefore the seller had no right to 
 rescind the contract upon a refusal to pay for one cargo before that 
 time. In Morgan v. McKee, 77 Pa. 228, and in Scott v. Kittanning 
 'Coal Co., 89 Pa. 23L 33 Am. Rep. 753, the buyer's right to rescind the 
 whole contract upon the failure of the seller to deliver one installment 
 was denied, only because that right had been waived, in the one case 
 by unreasonable delay in asserting it, and in the other by having accept- 
 ed, paid for, and used a previous installment of the goods. The decision 
 of the supreme judicial court of Massachusetts in Winchester v. New- 
 ton, 2 Allen (Mass.) 492, resembles that of the House of Lords in 
 Mersey Co. v. Naylor. 
 
 Being of opinion that the plaintiff's failure to make such shipments in 
 February and March as the contract required prevents his maintaining 
 this action, it is needless to dwell upon the further objection that the 
 shipments in April did not comply with the contract, because the de- 
 fendants could not be compelled to take about 1,000 tons out of the larg- 
 er quantity shipped in that month, and the plaintiff, after once designat- 
 ing the names of vessels, as the contract bound him tb do, could' not 
 substitute other vessels. See Busk v. Spence, 4 Camp. 329; Graves v. 
 Legg, 9 Exch. 709 ; Renter v. Sala, above cited. 
 
 Judgment affirmed.^* 
 
 «* In accord : Hjorth v. Albert Lea Mactiinery Co., 142 Minn. 387, 172 N; 
 W. 488 (1919) ; El Paso Grain & Milling Co. v. Lawrence (Tex. Civ. App.) 
 
582 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 BLACKBURN v. REILLY. 
 
 (Court of Errors and Appeals df New Jersey, 1885. 47 N. J. Law, 290, 1 
 Atl. 27, 54 Am. Rep. 159. 
 
 In case. In error to the Essex circuit court. 
 
 Blackburn, the plaintiff below, a Virginia dealer in bark, entered into 
 a contract on May 13, 1882, to sell to the defendant below, Reilly, a 
 Newark tanner, for use in his business, 52 car-loads of bark at the price 
 of $18 per ton, to be delivered at the rate of one car-load per week until 
 the whole should have been delivered. Under this contract five car- 
 loads were actually delivered. This was stored by Reilly in a loft over 
 his tannery with other bark. It was all paid for at the contract price 
 by July 3, 1882, but none of it was used until July ISth. Reilly claims 
 that it was then found to be musty, lumpy, and unfit for the purpose 
 for which it had been bought ; and shortly after Reilly notified Black- 
 burn not to send any more,-^-first by mail, alleging that he was over- 
 crowded, and shortly afterwards in a personal interview, alleging its 
 unmerchantable condition. * * * 
 
 t>ixoN, J. * * * The other question discussed on the argument 
 was whether the defendant had the right to refuse to receive any 
 more bark in case he could satisfy the jury that the five loads of bark 
 delivered were not equal in quality to the requirements of the con- 
 tract."^ The contract provided that the plaintiff should deliver, and the 
 defendant should receive, one car-load of bark weekly for a year at 
 $18 a ton, payable on delivery. It belongs to a class of agreements 
 sometimes called continuing contracts of sale, because they are to 
 be completely performed, not by single acts of delivery and payment, 
 but by a series of such acts at stated intervals. The rule to be applied in 
 determining whether the express obligations of such contracts remain 
 after one or more breaches by either party has been the subject of 
 much discussion of late years, and has given rise to some contrariety 
 of judicial opinion. We do not feel constrained by the phases of the 
 present case to enter at any length upon the details of this discussion. 
 In our opinion the rule established in England by the judgment of the 
 House of Lords in Mersey Steel & Iron Co. v. Naylor, 9 App. Cas. 434, 
 affirming the judgment of the Court of Appeal in S. C, 9 Q. B. Div. 
 648, is one which in ordinary contracts of this nature will work out re- 
 sults most conformable to reason and justice. The rule is that defaults 
 by one party in making particular payments or deliveries will not release 
 the other party from his duty to make the other deliveries or pay- 
 ments stipulated in the contract, unless the conduct of the party in 
 
 214 S. W. 512 (1919) ; Hoare v. Rennie, 5 H. & N. 19 (1859) ; King Philip 
 Mills V. Slater, 12 R. I. 82, 34 Am. Rep. 603 (1878) ; Pope v. Porter, 102 N. 
 Y. 366, 7 N. E. S04 (1886). Contra: Gerli v. Poidebard Silk Mfg. Co., 57 N. J. 
 Law, 432, 31 Atl. 401, 30 L. R. A. 61, 51 Am. St. Rep. 611 (1894) ; and see 
 Myer v. Wheeler, 65 Iowa, 390, 21 N. W. 692 (1884). 
 
 6 6 Parts of the report not dealing with this question are omitted. 
 
Sec. 2) INSTALLMENT CONTRACTS 583 
 
 default be such as to evince an intention to abandon the contract, or 
 a design no longer to be bound by its terms. This rule leaves the party 
 complaining of a breach to recover damages for his injury on the nor- 
 mal principle of compensation, without allowing him the abnormal 
 advantage that might inure to him from an option to rescind the bar- 
 gain. It also accords with the ancient doctrine laid down by Ser- 
 jeant Williams in his notes to Pordage v. Cole, 1 Saund. 320b, that 
 where a covenant (of the plaintiff) goes only to part of the considera- 
 tion on both sides, and a breach of such covenant may be paid for in 
 damages, it is an independent covenant, and an action may be main- 
 tained for a breach of the contract on the part of the defendant without 
 averring performance in the declaration. It of course is inapplica- 
 ble where the parties have expressed their intention to make per- 
 formance of a stipulation touching a part of the bargain a condition 
 precedent to the continuing obligation of the contract; and peculiar 
 cases might arise where the courts would infer such an intention 
 from the nature and circumstailces of the bargain itself, — cases in 
 which the courts' would see that the partial stipulation was so im- 
 portant, so went to the root of the matter, (to use a phrase of Black- 
 bum, J., in Poussard v. Spiers, 1 Q. B. Div. 410,) as to make its per- 
 formance a condition of the obligation to proceed in the contract. 
 
 The case in hand is one of ordinary character, and therefore the 
 question under the rule is whether the circumstances would warrant 
 an inference by the jury that the plaintiff purposed to abandon the 
 contract, or no longer to be bound by its terms. This question is, we 
 think, not doubtful. The plaintiff had delivered five car-loads, which 
 had been accepted and paid for by the defendant without any intima- 
 tion that they were not satisfactory; was ready to deliver the sixth, 
 when the defendant requested delay ; and was prevented from further 
 deliveries only' by the peremptory refusal of the defendant to receive 
 any more. Against this refusal the plaintiff protested, then proposed 
 an arbitration, and threatened suit if the defendant should persist, 
 and finally brought this action for damages. In the force of all this 
 there is not a shadow of reason for saying that the plaintiff had aban- 
 doned or repudiated the contract. If the five deliveries of defective 
 bark had been made against notice and remonstrance, it might have 
 suggested the idea that the plaintiff meant to disregard his obligations ; 
 but by the defendant's acceptance of and payment for the bark with- 
 out objection this ground for a possible inference of repudiation is 
 wanting in the case. We regard it as incontestable that the deliveries 
 were made in recognition of the binding force ,of the agreement. The 
 defendant, therefore, was not discharged. Cahen v. Piatt, 69 N. Y. 
 348, 25 Am. Rep. 203, was precisely like the case before us. _ The 
 plaintiff had agreed to sell the defendant glass, to be delivered in in- 
 stallments. He had made several deliveries, which had. been ac- 
 cepted and paid for by the defendant. Subsequently the defendant 
 
584 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT , (Ch; i 
 
 complained of the quality, and refused to' receive any more. The 
 suit was for damages : resulting from the refusal, and the plaintiff re- 
 covered. Scott V. Kittanning Coal Co., 89 Pa. 231, 33 Am. Rep. 753, 
 was also similar; but there the defendant contended that the con- 
 duct of the plaintiff in the delivery of the defective coal was fraud- 
 ulent, yet the court held the defendant would not be thereby dis- 
 charged. 
 
 There was no error in the ruling of the trial justice on this proffered 
 defense. The judgment below should be affirmed. °' 
 
 MILLAR'S KARRI & JARRAH CO. v. WEDDEL, TURNER 
 
 &CO. 
 
 (In the King's Bench Division, 1908. 100 Law T. [N. S.] 128.) 
 
 The contract was in the following terms: 
 
 Sold for account of Messrs. Weddel, Turner, and Co. to our prin- 
 cipals ; 1 100 pieces Tasmanian blue gum at 2s. 9d. per foot cube, cost, 
 freight, and insurance, and safe port in the United Kingdom, desti- 
 nation to be declared by buyers on or before being advised that bills 
 of lading are ready for signature. All to be 14 in. by 14 in. square 
 by 65 ft. long. The timber to be hewn die square without camber, 
 sound, straight grown, and of good merchantable quality and con- 
 dition. Shipment of about' half the quantity to be made in June, 
 July,. August next at buyers' option, and the balance to be shipped 
 October, November, December next at buyers' option. To be paid 
 for by net cash on presentation of and in exchange for shipping 
 documents. Any question arising under this contract to be decided 
 by the brokers hereto, but should either of the principals elect to do 
 so they may call for arbitration in the usual manner. °^, 
 
 BiGHAM, J. The question in this case is whether the award is bad on 
 its face. The material facts are as follows: On the 15th Feb.j 1907, 
 Weddel and Co. sold to Millars and Co. 1100 pieces of Tasmanian 
 l)lue gum timber at a c. f. and i. price; the wood was to be of a 
 certain size and hewn in a certain way ; it was to be without camber, 
 sound, straight grown, and of good merchantable quality and con- 
 dition. The shipment was to be made in Tasmania in two parcels 
 — namely, about one-half in June and the remainder in October, the 
 destination being the United Kingdom. The payment was to be made 
 against delivery of the shipping documents. The shipments were 
 not made in the required proportions, but the buyers appear to have 
 
 8" In accord: Oahen v. Piatt, supra; Jonassohn v. X&ung, 4 B. & S. 296 
 (1863) ; John Deere Plow Co. v. Shellabarger, 140 Tenn. 123, 203 S. W. 756 
 (1918) ; Willett Seed Co. v. Kirkeby-Gunderstrup Seed Co., 145 Ga. 559, 89 
 S. B. 486 (1916). Contra: Lindsborg Milling & Elevator Co. v. Danzero (Mo. 
 App.) 193 S. W. 606 (1917). 
 
 oT The statement of facts is condensed. 
 
Sec. 2) installment' oonteacts 585' 
 
 made no point of this. The first shipment consisted of 750 pieces; 
 the second of 350 or thereabouts. The shipping documents in respect 
 of both shipments arrived before the goods, and were duly taken, 
 up by the buyers. When the first parcel arrived the buyers exam- 
 ined the wood and found it did not accord with the requirements 
 of the contract. They refused to accept it and demanded all their 
 money back, intimating their intention to refuse to take the secorid 
 shipment upon the ground that the first shipment was such a depar- 
 ture from the contract as to justify a refusal to accept either parcel. 
 
 The vendors denied the statements of the buyers as to the first lot, 
 and contended that in any event there was no justification for refus- 
 ing to take the second lot. The dispute was then referred to Mr. Al- 
 fred Lyttelton, who, after hearing the evidence, made the award 
 now complained of. It is in these terms : "I award that the 750 
 pieces did not comply with the terms of the contract, and I further 
 award that .the said shipment was and is so far from complying with 
 the requirements of the contract as to entitle the buyers to repu- 
 diate and to rescind the whole, contract, and to refuse to accept the 
 said shipment and all further shipments under the said contract." 
 
 It is this award which is said to be bad on 'its face. It is argued that 
 it violates the well-known rule of law that where goods are sold to be 
 delivered in different instalments a breach by one party in connec- 
 tion with one instalment does not of itself entitle the other party 
 to rescind the contract as to the other instalments. But I do not 
 agree. The rule, which is a very good one, is, like most rules, sub- 
 ject to qualification. Thus, if the breach is of such a kind, or takes 
 place in such circumstances as reasonably to lead to the inference 
 that similar breaches will be committed in relation to subsequent de- 
 liveries, the whole contract may there and then be regarded as repu- 
 diated, and may be rescinded. If, for instance, a buyer fails to pay 
 for one delivery in such circumstances as to lead to the inference 
 that he will not be able to pay for subsequent deliveries; or if a 
 seller delivers goods differing from the requirements of the con- 
 tract, and does so in such circumstances as to lead to the inference 
 that he carmot, or will not, deliver any other kind of goods in the 
 future, the other contracting party will be under no obligation to Wait 
 to see what may happen; he can at once cancel the contract and rid 
 himself of the difficulty.' This is the effect of section 31,.subsec. 2 
 of the Sale of Goods Act 1893, which reads as follows : "Where there 
 is a contract for the sale of goods to be delivered by stated instal-^ 
 ments, which are to be separately paid for, and the seller makes de- 
 fective deliveries in respect of one or more instalments, or the buyen 
 neglects or refuses to take delivery of, or pay for, one or more in- 
 stalments, it is a question in each case depending on the terms of the 
 contract and the circumstances of the case, whether the breach of. 
 contract is a repudiation of the whole contract, or whether it is .a 
 
586 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 severable breach giving rise to a claim for compensation, but not to 
 a right to treat the whole contract as repudiated." In the present case, 
 says the umpire, the first shipment, consisting of much more than half 
 the whole, was so bad as to lead to the inference that the second ship- 
 ment, which was to be made at the same place and on behalf of the 
 same parties, would also be bad. That is the sense in which I read 
 what he has written. Can it be said that such an inference could 
 not reasonably be drawn from the conduct of the sellers in relation 
 to the first shipment ? I think not. The umpire has so found, and has 
 expressed his finding in intelligible language. I think, therefore this 
 motion must be dismissed. 
 
 Walton, J. I agree, and for the reasons which have been stated, I 
 only wish to add that it appears to me that there are two flaws in the 
 argument which was addressed to us in support of this motion. It 
 has been said, in the first place, that the award can only be supported 
 on the ground that what the sellers did amounted to a repudiation, 
 of the whole contract — that that means or involves ah intention to re- 
 pudiate the whole contract, and it has been said that, granting every- 
 thing here, it is plain that there was no intention to repudiate, because 
 the sellers were insisting that they were performing their contract as 
 far as they had gone, and insisting that they were entitled to have the 
 contract performed in the future. I think that that is a fallacy. Of. 
 course, the idea of repudiation, which is the word used in section 31 
 of the Sale of Goods Act, does; no doubt, in a sense involve an inten- 
 tion to repudiate ; but, to constitute a repudiation, as Sir George Jes- 
 sel pointed out in the Mersey Steel & Iron Company v. Naylor (su- 
 pra), it is not necessary that the party should say, "I will repudiate 
 the contract," or "I intend to repudiate the contract." If, in fact, he 
 is repudiating the contract, he is doing so, although he may be con- 
 tending that he is performing the contract, and may be intending and 
 expressing an intention to perform what is left of the contract. As 
 Sir George Jessel said in the passage which I have referred to, there 
 may, indeed, be a case where one party says in so many words that 
 he does not intend to go on with the contract, but generally the inten- 
 tion must be inferred from the acts of the parties. The second flaw 
 which I think is involved in the argument is this, that a defective 
 delivery of one instalment cannot per se amount in effect to a repu- 
 diation. I think that is the foundation of a great deal of the argu- 
 ment that has been addressed to us. I desire to point out that I 
 cannot find in the old cases, and certainly not in section 31 of the Sale 
 of Goods Act 1893, any such statement of the law. All that the Sale 
 of Goods Act, and we need not look back further than the words of 
 that Act, says is that in the case of defective delivery in the case of 
 one instalment, it is a question in each case depending on the circum- 
 stances of the contract whether the breach of contract — ^that is, in 
 this particular case, whether the defective delivery — is a repudiation 
 
Sec. .2) INSTALLMENT CONTEACTS 587 
 
 of the whole contract (that is the plain meaning of the words), or 
 whether the defective delivery is a severable breach giving rise to 
 a claim for compensation, but not to the right to treat the whole con- 
 tract as repudiated. I gather that that plainly means that the defec- 
 tive delivery may, having regard to the terms of the contract and 
 to circumstances of the case, amount in effect to a repudiation of the 
 whole contract. Now, what has the umpire found here ? He has 
 found that there was a defective delivery aniounting to a breach of 
 contract, and he has found that the defective delivery, under the cir- 
 cumstances of the case, was such a breach as amounted in effect to 
 repudiation. He may or may not have been right in such a finding; 
 we do not know what the evidence was upon which he came to that 
 conclusion; we do not know whether there was any evidence upon 
 which he was justified in coming to such a conclusion ; but that ques- 
 tion is not before us. It seems to me that the terms of the award 
 follow quite proper ly^I do not mean to say in exact words, but in 
 effect-^the terms of the section, arid that there is no ground for saying 
 that the award is bad on the face of it. Therefore, I think this motion 
 fails. 
 
 Motion dismissed. 
 
 JENSEN V. GOSS et al. 
 (District Court of Appeal of California, 1919. 39 Cal. App. 427, 179 Pac. 225.) 
 
 Action by Fred Jensen against Charles E. Goss and another. From 
 a judgment for plaintiff, defendants appeal. Reversed. 
 
 Waste, P. J. This is an appeal from a judgment for $231 for dam- 
 ages found to have been suffered by plaintiff by reason of the failure 
 of defendants to deliver to him hay under a written contract dated 
 June 1, 1916, by the terms of which the hay was to be paid for "on 
 the 13th day of each month following delivery." The defense is that 
 plaintiff' refused to pay for the hay as required by the contract, there- 
 by releasing defendants from further performance on their part. 
 
 The testimony of and in behalf of defendants is corroborated by the 
 evidence and admissions of plaintiff while on the stand, and fails to 
 support the findings of the trial court. Plaintiff never met his obliga- 
 tions to pay as required. On the 15th day of July, the first month 
 following deliveries of hay, one of the defendants personally called 
 on him and demanded payment of the "money due according to his 
 contract." Defendant promised "that in a matter of a few days he 
 would pay." He made no payment until the 28th of the month, when 
 he paid $275 on account. 
 
 Defendants continued to deliver hay as required by the plaintiff, 
 and the latter continued his dilatory payments. Statements of the 
 account were regularly sent to him on the 13th of each month. Col- 
 lectors of the defendants repeatedly called on him. Members of the 
 
588 IMPLIED AND CONSTRUCTIVE CONDITIONS PEECEDENT (Ch. 4 
 
 firm '(defendants) as repeatedly conversed with him on the telephone, 
 demanding payment. This condition of affairs continued until Octo- 
 ber 3d, after which defendants delivered no more hay. At that time 
 plaintiff owed them $920, on account of which he made three pay- 
 ments of $200 each, the last on December 12th. 
 
 On December 14th one of the defendants personally called on plain- 
 tiff and demanded payment of $320.22, the balance due. Plaintiff, ad- 
 mitting that he "would pay him, that he had some money then," re- 
 fused to pay until defendants delivered two more carloads of hay. 
 There was some conversation relative to the quality of the hay deUv- 
 ered by the defendants, but refusal to pay the balance due was not 
 predicated on that ground. Defendant told him that he considered the 
 contract canceled. The same day defendants' attorneys made demand 
 for "immediate payment of the" balance due, and notified plaintiff 
 that, unless such payment was made upon receipt of the demand and 
 notice, defendants would, by reason of the breach of the contract by 
 .plaintiff in failing to make payments for said hay as provided there- 
 in, refuse to deliver any further amount of hay. 
 
 Plaintiff did not pay the balance until December 21st, at which time, 
 through his attorneys, he requested the defendants to deliver two car- 
 loads of hay. No hay being delivered, the plaintiff four or five days 
 later went to the barn of defendants and personally demanded de- 
 livery of the hay, and was informed by them that the contract was at 
 an end. After giving further orders to defendants for delivery of 
 hay, no one of which was filled, plaintiff commenced this action. 
 
 In view of the evidence in the case, we have looked to respondent 
 to sustain the findings and judgment of the trial court by weight of 
 authority. This he has not done. None of the cases cited by him, so 
 far as we are able to find, relate to a mercant^ile contract such as the 
 one here under consideration.^ They have to do with purchase of 
 real estate on the installment plan, forfeitures, and equitable rights or 
 leasehold interests. "In mercantile contracts, such as contracts for 
 the manufacture and sale of goods .and the like, it is generally held 
 that the parties have intended to make time the essence of the con- 
 tract." ,13 Corpus Juris, 688, and cases cited. The defendants were 
 justified in rescinding the contract when plaintiff showed a clear in- 
 tention to violate its provisions, and to withhold payments due until 
 the delivery of more hay. Minaker v. California Canneries Co., 138 
 Cal. 239, 71 Pac. 110. 
 
 The rights of defendants to rescind were not waived, nor were they 
 affected, by the fact that they did not stop delivery of hay immediate- 
 ly after failure of plaintiff to make his first payment as required. 
 They had the right to rely, for a reasonable length of time at least, 
 upon the promise of plaintiff to pay. San Francisco Bridge Co. v. 
 Dumbarton Land & Improvement Co., 119 Cal. 272, 51 Pac. 335. 
 
 Had plaintiff rested his refusal to pay on the ground of a fail- 
 ure to deliver the quality of hay required by the contract, such posi- 
 
Sec. 2) INSTALLMENT CONTRACTS , 589 
 
 tion would not aid him in this action. He could not offset any dam- 
 ages for such alleged breach on the part of defendants without showing 
 performance on his own part of his own agreement. Minaker v. Cal- 
 ifornia Canneries Co., supra. 
 For the reasons above stated, the judgment is reversed/* 
 
 HARTON V. HILDEBRAND et al. 
 (Supreme Court of Pennsylvania, 1911. 230 Pa. 335, 79 Atl. 571.) 
 
 Suit by William E. Harton against William E. Hildebrand and 
 another. From a decree dismissing the bill, plaintiff appeals. Re- 
 versed, and bill reinstated. 
 
 MestrEzaT, J.°* We do not agree with the learned court below in 
 ■dismissing this bill, which was filed to restrain the defendant Howley 
 from selling and disposing of the houses until He had paid the debts 
 due from Hildebrand, the other defendant, to the plaintiff Harton. 
 
 No exceptions were filed by either party to the findings of fact 
 made by the learned trial, court, and therefore the case must be dis- 
 posed of upon those facts. They may be summarized as follows : 
 
 On June 1, 1901, Hildebrand entered into a contract with Harton for 
 the erection of eight dwelling houses on certain lots fronting on 
 Brackenridge avenue in the thirteenth ward of the city of Pittsburg. 
 On June 9, 1901, Frank P. Howley made a deed to Hildebrand for 
 these lots, and he proceeded at once with the erection of the buildings. 
 On August 7, 1901, Michael P. Howley, father of Frank P. Howley, 
 conveyed to Hildebrand 26 lots of ground on Avalon street in the 
 thirteenth ward of the city of Pittsburg. Judgment notes were given 
 to secure the purchase money, but they were withheld from record 
 
 «8 In the following cases nonpayment of part of the price as agreed was held 
 to privilege the seller to make no more deliveries and to constitute a vital 
 breach; Burt v. Garden City Sand Co., 237 111. 473, 86 N. E. 1055 (1909), 
 buyer largely in arrears after definite notice that it would be fatal ; Dudley 
 V. Wye, 230 Mass. 350, 119 N. E. 790 (1918), prompt payment had been Insisted 
 on, and buyer gave weak excuses ; Samuels v. W. H. Miner Chocolate Co., 235 
 Mass. 312, 126 N. E. 771 (1920), failure to pay and also failure to send more 
 orders as agreed'; National Machine & Tool Co. v. Standard Shoe Machinery 
 Co., 181 Mass. 275, 63 N. E. 900 (1902) ; Kamps & Sacksteder Drug Co. v. 
 United Drug Co., 164 Wis. 412, 160 N. W. 271 (1916), nonpayment plus 
 bankruptcy; Kokomo Strawboard Co. v. Inman, 134 N. T. 92, 31 N. E. 248 
 (1892), repeated failures to pay; Rugg v. Moore, 110 Pa. 236, 1 Atl. 320 
 (1885), failui-e to pay plus tortious taking of the goods; Lang v. Hedenberg, 
 277 111. 368, 115 N. E. 566 (1917), land sale; Hull Coal & Coke Co. v. Empire 
 Coal & Coke Co., 113 Fed. 256, 51 C. C. A. 213 (1904) ; Phillips v. Seymour, 
 91.11. S. 646, 23 L. Ed. 341 (1875) ; CoUins-Plass-Thayer Co. v. Hewlett, 109 
 S. C. 245, 95 S. E. 510 (1918)-; Beltinck v. Tacoma Theater Co., 61 Wash. 132, 
 111 Pae. 1045 (1910), advertising contract. 
 
 Of course, the condition of payment, like other conditions, can be waived. 
 Fairchild-Gilmore- Wilton Co. v. Southern Refining Co., 158 Cal. 264, 110 Pac. 
 951 (1910). 
 
 '» Parts of the opinion are omitted. 
 
590 IMPLIED AND CONSTRUCTIVE! CONDITIONS PEEOEDENT (Ch. 4 
 
 until the Prudential Trust Company, which was to furnish the money' 
 for the erection of the houses, had put on record as a first lien a mort- 
 gage from Hildebrand. On September 26, 1901, Hildebrand ma:de 
 a contract, with Harton for the erection of 19 houses on the Avalon 
 street property. This contract provided that the builditigs should 
 all be finished by April 1, 1902, and that the contract price should be 
 $62,149, and should be paid "by the owner to the contractor in in- 
 stallments as follows : 70 per cent, of the above amount to be paid 
 on estimated amount of work done as the buildings progress." 
 
 The Brackenridge fivenue houses were completed in March, 1902. 
 The houses on Avalon street were not finished or nearly finished by 
 April 1, 1902, and Hildebrand and Harton agreed in the winter of 
 1901-1902 that no attempt should be made in the cold weather to com- 
 / pkte these houses on April 1st. The contract price for the Bracken- 
 ridge avenue houses was $18,000 and when they were completed in 
 March, • 1902, there was due from Hildebrand to Harton $5,573.61. 
 
 Harton began the Avalon street houses soon after making the con- 
 tract and carried on the work until December when it was suspended, 
 and began work again about March 1, 1902, and continued until about 
 May 20, 1902, only nine of the houses, , howeyer, being begun at this 
 or any later time by him; this action on his part being apparently 
 acquiesced in by Hildebrand. On the latter date Harton presented to 
 Hildebrand an estimate of the work already done on these houses, 
 showing the value of the work done to date, the 70 per cent, of the 
 amount required to be paid in installments, the amount of extra work 
 done, the aggregate of the amount already paid him, and the balance of 
 $2,496.26, which was then due and payable. This statement was ad- 
 mitted by Hildebrand in writing to be correct. 
 
 In May, 1902, a number of mechanics' liens were filed against the 
 Brackenridge property ; but no liens were ever filed against the Avalon 
 street houses. , 
 
 On May 22, 1902, Harton quit work on the Avalon street houses and 
 declared that he would not go on with the contract because of the 
 failure of Hildebrand to pay him the sum owing on the first and on 
 the second contracts as above stated. 
 
 On June 14, 1902, Hildebrand conveyed to Frank P. Howley both 
 the Brackenridge avenue and Avalon street properties, and as part of 
 the same transaction an agreement was entered into between Hilde- 
 brand and Howley by which the latter accepted the conveyance, sub- 
 ject to all legal claims for labor and materials furnished in and about 
 the erection of the houses. By this agreement, Howley assumed pay- 
 ment of these claims. 
 
 On July 31, 1902, Howley wrote Harton that if the latter was willing 
 to go on under the contract he would aid him as much as he could in 
 the construction of the buildings ; that if he declined to go on he would 
 complete the buildings himself. This notice was given under the sixth 
 paragraph of the contract relating to the Avalon street houses which 
 
Sec. 2) INSTALLMENT CONTRACTS 591 
 
 provides that, if the contractor at any time during the progress of the 
 work fails to supply material or workmen, or causes any unreasonable 
 suspension of work, the owner may terminate the contract and finish 
 the buildings at the contractor's expense. Immediately upon the re- 
 ceipt of this communication Harton replied that as there was owing 
 to him for a long time at least $2,500 on this contract which had not 
 been paid, and as it was impossible by reason of the nonpayment for 
 him to carry out the contract, that he thereupon declared the contract 
 null and void. Howley then proceeded to finish the nine houses, 
 which cost him $12,548 more than the contract price. * * * 
 
 The parties agree that the only question in the case is whether, under 
 the circumstances existing at the time, Harton was justified in stopping 
 work on the Avalon street houses on May 22, 1902, and, subsequently, 
 in refusing to proceed with it on notice by Frank P. Howley, who 
 was then the owner of the property. As noted above, the learned court 
 below held that "under all the circumstances it was altogether unrea- 
 sonable for Harton to rescind the contract for any such delay of pay- 
 ment as this." The court, it will be observed, does not find that the 
 amount of the estimate of May 20, 1902, is not correct or was not due 
 Harton at that date, or that Howley was dissatisfied with it ; nor does 
 the court base its decree against the plaintiff on either of those grounds. 
 It, therefore, becomes important to ascerta:in what the circumstances 
 were on May 22, 1902, when Harton declined to proceed under the 
 Avalon street contract, and on August 1, 1902, when he declared the 
 contract rescinded. While, as suggested by the counsel for the ap- 
 pellee, a balance due Harton under the Brackenridge. avenue contract 
 has no bearing upon the rights of the parties under the Avalon street 
 contract and would not justify the rescission of the latter contract 
 by Harton, yet it may not be out of place to note the fact that, at the 
 date of the suspension of work by Harton on the Avalon street houses, 
 Hildebrand was indebted to him under the Brackenridge avenue con- 
 tract, which had been fully performed by Harton, in the sum of over 
 $5,500. For the payment of this balance, Harton had no security, and 
 Hildebrand had no property out of which it could be collect- 
 ed. * * * 
 
 The contract price was to be paid, as stipulated in the agreement, 
 "by the owner to the contractor in installments as follows: 70 per 
 ceht. of the above amount to be paid on estimated amount of work 
 done as the buildings progress." It is manifest, therefore, that estimates 
 were to be made as the work progressed. While the contract does 
 not state when the estimates were to be made, yet it clearly contemplated 
 that when an estimate had been made that 70 per cent, of it was 
 then due and payable. On May 20, 1902, an estimate of the work 
 done and the material furnished was made, and it appeared by the 
 estimate that there was due and payable from Hildebrand to Harton 
 on the Avalon street contract the sum of $2,496.26. Hildebrand was 
 ■ the owner of the property^ and the money was due from him, It is 
 
592 IMPLIED AND CONSTBUCTIVB CONDITIONS PEECEDENT (Cfl. 4 
 
 not pretended that he made any offer to pay it or secure it. At that 
 time he had. no property, except the Brackenridge avenue and Avalon 
 street properties. As found by the court, there was yet due Hartoij on 
 the Brackenridge avenue contract over $5,500; That property was 
 incumbered by a first mortgage to the Prudential Trust Company ^d 
 by judgments entered on notes for the purchase price of the land. 
 Hildebrand had signed a^ no-lien contract. By agreement of the 
 parties another Prudential Trust Company mortgage pf $60,000 was 
 a first lien on the Avalon street property, and it was also subject 
 to the judgments entered for the purchase money. It is therefore ap- 
 parent that, for the balance due Harton for labor and material fur- 
 nished in the construction of the Avalon: street houses, recourse to 
 that property or the Brackenridge avenue property would avail him 
 nothing. Hildebrand ' was without meanSj and a pursuit of him by 
 Harton would have simply resulted in the pursuer being mulcted in 
 the cost in a vain endeavor to collect the claim. 
 
 These were the conditions existing, at the time the estimate of the 
 balance due Harton on th« Avalon street contract was made on May 
 20, 1902, and on the second day thereafter when he declined to pro- 
 ceed with the work until the balance was paid. The same conditions 
 prevailed on August 1, 1902, when he rescinded the contract. Both 
 parties consented to the jurisdiction of equity, and that a chancellor 
 should adjust their differences in accordance with equitable principles. 
 Was it unreasonable, as held by the court below, for Harton to stop 
 work under these circumstances? Was he compelled to proceed with 
 the work, put his labor and material in it, and thus add to the amount 
 already owed him by Hildebrand, with neither property nor any 
 responsible party in view from whom he could compel payment? Is 
 there any principle of equity or rule of law which would require him 
 under these circumstances to proceed with the work; simply for the 
 benefit of Hildebrand's creditors and, possibly, for the improvement of 
 Howley's property? Having due regard for: the rights of the parties 
 under the stipulations of their contract, these questions permit of but 
 one answer, and that is in the negative. * * * 
 
 Hildebrand, the owner, had breached the Avalon street contract, and 
 he was not in a position to demand its enforcement. Howley occupied 
 no better position. The contract was i entire as to the erection of the 
 19 houses, and divisible and severable as to the payment of the in- 
 stallments for the work and material furnished. Hildebrand's failure, 
 therefore, to perform his part of the agreement by paying the estimate 
 of May 20, 1902, gave Harton the right to declare the contract at 
 an end. Rugg v. Moore, llO Pa. 236, 1 Atl. 320.; Easton v. Jones, 
 193 Pa. 147, 150, 44 Atl. 264, 265. In the last case it is said: "While 
 plaintiff's failure in ability or intention to complete the work will be 
 a good defense, ' even to an action for a payment stipulated to be- 
 Icome dtie on a state of progress shown "to be reached, yet a refusal to 
 pay such an installment without that or other legal excuse is such a 
 
Sec. 2) INSTALLMENT CONTRACTS 
 
 593 
 
 breach of the contract as wiir justify a rescission, and entitle the 
 plaintiff to recover pro tanto for the work." * * * 
 Decree reversed and bill reinstated.'"* 
 
 ST. REGIS PAPER CO. v. SANTA CLARA LUMBER CO. 
 
 (Court of Appeals of New York, 1906. 186 N. Y. 89, 78 N. E. 701.) 
 
 Action by the St. Regis Paper Company against the Santa Clara Lum- 
 ber Company. From a judgment of the Appellate Division of the Third 
 Department (93 N. Y. Supp. 1146), affirming a jud^ent entered on a 
 decision of the Special Term (85 N. Y. Supp. 1034) in favor of defend- 
 ant, plaintiff appeals. Reversed, and new trial granted. 
 
 CuLLEN, C. J. This action was brought for the specific performance 
 of a contract whereby the defendant agreed to cut and deliver to the 
 plaintiff from 11,000 to 13,000 cords of pulp wood a year from a large 
 tract of wild lands in the Adirondacks owned by the defendants, during 
 the term of 10 years, at the price of $9 a cord, with the privilege to the 
 plaintiff to obtain a renewal of the contract for an additional term of 
 10 years at $12 per cord. The case has been before this court on a 
 previous appeal and is reported in 173 N. Y. 149, 65 N. E. 967. In that 
 report will be found a statement of the parts of the contract material to 
 this controversy. ' On the former appeal, this court, reversing the deci- 
 sions of the courts below, held that the contract was one the performance 
 of which a court of equity could properly enforce. After our decision 
 the case was tried on its merits and judgtnent was rendered by the trial 
 court in favor of the defendant on the ground that the plaintiff had 
 made default in the performance of that provision of the contract where- 
 by the plaintiff agreed to make advances to the defendant for the cost 
 of cutting and getting out the wood. The provision is as follows : 
 "Party of the first part (defendant) shall commence to cut wood on or 
 about the 15th day of August of each year for the following season's 
 supply. Party of tlie second part (plaintiff) shall make such advances 
 
 '"' The failure and refusal of an owner to make a "progress payment" as 
 required by a building (or other expensive) contract goes to the essence. 
 American-Hawaiian Engineering & Construction Co. v. Butler, 165 Cal. 497, 
 133 Pac. 280, Ann. Cas. 1916C, 44 (1913) ; Woodruff Co. v. Exchange Kealty 
 Co., 21 Cal. App. 607, 132 Pac. 598 (1913) ; Peet v. City of East Grand Forks, 
 101 Min"Ji. 518, 112 N. W. 1003 (1907), city had no funds, large sum due ; New- 
 ton V. Highland Imp. Co., 62 Minn. 436, 64 N. W. 1146 (1895) ; Howard Coun- 
 ty V. Pesha, 103 Neb. 296, 172 N. W. 55 (1919) ; Fernald Woodward Co. v. 
 Conway Co. (D. C.) 229 Fed. 819 (1916). 
 
 "As is usually the case with building contracts, it evidently was in the con- 
 templation of the parties that the contractor could not be expected to finance 
 the operation to completion without receiving the stipulated payments on 
 account as the work progressed. In such cases a substantial compliance as 
 to advance payments Is a condition precedent to the contractor's obligation to 
 proceed." Guerini Stone Co. v. P. J. Carlin Cbnst. Co., 248 U. S. 334, 39 Sup. 
 Ct. 102, 63 L. Ed. 275 (1919). 
 
 COEBIN CONT 38 
 
594 IMPLIED AND CONSTEDCTIVB CONDITIONS PRECEDENT (Ch. 4 
 
 of money to party of the first part as it may request during the progress 
 of the work, but party of the second part need not advance more than 
 approximately the cost of the work done. Payment for the said wood 
 shall be made by the party of the second part to the party of the first 
 part on the 15th day of each month for the wood delivered during the 
 next preceding calendar month, after first deducting from the aggregate 
 of the purchase price of the said wood one-tenth of the advances made 
 upon that season's operations until such advances have been repaid." 
 The judgment of the Special Term was affirmed by, the Appellate Divi- 
 sion by a divided court, and from the judgment of affirmance this ap- 
 peal is taken. 
 
 The contract, dated the 29th day of August, 1899, was executed by 
 the parties about the 1st of October in that year. For some time prior 
 to the execution of the contract, however, the parties had been in nego- 
 tiation concerning it, and during that interval, in contemplation of the 
 contract, the defendant had built roads, constructed permanent camps, 
 and incurred expenses for various items necessary for the proseaition 
 of the work. Under the contract, the wood was to be delivered to the 
 plaintiff at any point, the expense of the transportation to which should 
 not exceed the cost of the transportation from Tupper L,ake Junction 
 to Watertown N. -Y., and the delivery was to commence on or about 
 the 1st day of June in each year. . The ordinary method of taking out 
 wood was to cut it, and haul it to the streams during the winter season, 
 whence the next spring it was floated to the point of delivery. No de- 
 liveries would be, therefore, made to the plaintiff till June, 1900. On 
 October 7th the defendant demanded the sum of $2,500 on account of 
 expenses already incurred by it, with which demand the plaintiff com- 
 plied on October 18th. On October 26th the defendant demanded the 
 sum of $5,000 on account, and on November. 17th an additional sum of 
 $5,000. On account of these two demands, the plaintiff, on December 
 5th, paid the sum of $7,500. Now, while the whole controversy and the 
 decision of the court below proceed on the failure of the plaintiff to 
 properly respond to the defendant's demands for advances, it would be 
 impracticable to give within the limits of an opinion even an abstract of 
 the details of the correspondence between the parties. It is sufficient 
 to say that from October 26, 1899, to March 24th following, the defend- 
 ant made repeated demands for advances, while the plaintiff insisted 
 that the advances asked for by the defendant were largely in excess of 
 those ordinarily made for the purpose of takitig pulp wood from the 
 forest. On March 24, 1900, which was the date of the last demand by 
 the defendant prior to its notification to the plaintiff that the contract 
 was rescinded by it, the account between the parties, as found by the 
 trial court, stood as follows : The defendant had expended $37,132^80 ; 
 the plaintiff had advanced the defendant the sum' of $25,000. 
 
 Chi March 24th the defendant sent to the plaintiff the following letter : 
 "Malone, N. Y., March 24th, 1900. The St. Regis Paper Co., Water- 
 
•Sec. 2) INSTALLMENT CONTRACTS 595 
 
 town, N. Y. — ^Dear Sirs: In response to my notice to you some time 
 since you sent me check for $5,000 on the Santa Clara Lumber Co. 
 pulp-wood contract, which I at once forwarded to the company in 
 New York. I have to-day received a letter from the company, saying 
 that they have received $25^000 which was $12,500 short of the actual 
 cost of the wood in its present condition, and they request me to ask 
 you to remit at least $5,000 more ; that the annoyance that they experi- 
 ence in getting thfese advances is so great that they feel very much dis- 
 inclined to continue trying to fulfill the contract on their part unless the 
 advances can be more promptly made. Hoping that you will remit at 
 least $5,000 I remain, Very respectfully yours, John P. Badger." 
 
 To which the plaintiff made this reply : "Watertown, N. Y., March 
 26th, 1900. John P. Badger, Esq., Malone, N. Y.— Dear Sir: Your 
 favor of the 24th inst. at hand and noted. We have advanced the SantS. 
 Clara Lumber Co. $2 per cord upon the quantity of pulp wood which 
 they claim to have cut, and we have advanced this amount promptly 
 ■upon receiiving. their several requests. As we have alreiady explained 
 to you, this is the amount which is ordinarily advanced to cover the 
 cost of pulp wood delivered to the stream.. We understand that the 
 Santa Clara Lumber Co. have spent an unusual amount of money this 
 year in establishing permanent camps and roads with a view of re- 
 ducing the expense of maintenance in the future. We also understand 
 that they have been lumbering upon their own account. We could 
 hardly be expected to share in unusual expenses, and in view of the 
 fact that they are conducting extensive operations of their own, it seems 
 to us the only way We can arrive at the amoimt to advance is to take 
 the customary amount. As we have heretofore said to you, however, 
 the matter is merely one of interest, and we have suggested a friendly 
 arbitration. You have consented to the arbitration, but, nevertheless, 
 coAtinue to make further requests for additional advances. Very truly 
 yours, G. C. Sherman, Treas." 
 
 Nothing further passed till April 12th, when the defendant noti- 
 fied the plaintiff that on account of the latter's failure to make advanc- 
 es to the extent of the cost of work done the contract was rescinded, 
 and at the same time sent to the plaintiff a certifi.ed check for $25,344.- 
 79, the amount advanced by it with interest. It appears that at this 
 time pulp wood had appreciated in price, and the defendant had made 
 a contract for the sale of its wood to other parties on more favorable 
 terms. The plaintiff refused to receive the check, and wrote the de- 
 fendant insisting that the contract still continued in force, and there- 
 upon the plaintiff brought this action for its specific performance. 
 
 The learned trial court found that the plaintiff failed and refused to 
 "advance the cost of the work as requested by the defendant or any fair 
 approximation thereof. That the defendant repeatedly notified the 
 plaintiff of its intention to rescind the contract in case its requests were 
 not complied with. * * * That the plaintiff did not make the ad- 
 
596 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Gh. 4 
 
 varices, as requested', for approximately the cost of the work done, and 
 that, with knowledge of the cost and of the terms of the contract, and 
 with notice of the intention of the defendant to rescind if its requests 
 were not complied with, deliberately and intentionally refused and neg- 
 lected to make such advances, and that such refusal and neglefct was 
 not caused by any inadvertence or by any misunderstanding of the 
 facts." If the testimony in any aspect justified this finding of the trial 
 court, it is a complete answer to this appeal, for equity will not enforce 
 a contract at the instance of a party who has deliberately and intention- 
 ally neglected and refused to comply with its requirements. But we 
 think that there isno evidence to support this finding. Granting, as we 
 must, for the trial court has so found, the fact, that the adviances made 
 by the plaintiff did not equal the expenditure incurred approximately 
 by the sum of $12,500, that fact alone does not show that the plaintiff's 
 default was deliberate and intentional. 
 
 We agree with the learned counsel for the respondent that the ad- 
 vances, which under the contract the plaintiff was obliged to make, 
 were not limited by the drdinary and customary advances miadeto par- 
 ties who get out wood for the market, but only by the sum which the 
 defendant actually and properly expended towards cutting and hauling 
 the lumber. Nevertheless, the contract was one which would naturally 
 breed dispute and difference of opinion, for no definite amount to be 
 advanced was specified. Whether outlay made for the work of a per- 
 manent character, such as the construction of roads and the building 
 of camps, the defendant was entitled to demand from the plaintiff, 
 under the provisions of the contract, is not wholly free from doubt. 
 While the fact that the amounts called for by the defendant largely 
 exceeded the usual advances in the business did not justify the plain- 
 tiff in refusing to accede to the defendant's demands, still it tended to 
 excuse plaintiff's hesitation in complying. The contract contained a 
 provision that all matters of difference tha,t might arise between the 
 parties respecting the, contract or the fulfillment thereof should be de- 
 termined by arbitration. We concede that this provision was too broad 
 to:be enforced by the courts. Nevertheless, granting its invalidity, the 
 parties negotiated for an arbitration under it. These negotiations had 
 not been terminated at the time of the defendant's rescission of the 
 contract. There is nothing to show that the position of the plaintiff in 
 this controversy was not taken by it in good faith. It was willing to 
 help the defendant obtain money, for it expressly offered, to discount 
 the defendant's note for such amount as it might need. There is, not 
 a word from the plaintiff to be found in the correspondencejtending to 
 show an abandonment of the contract. On the contrary, it was con- 
 stantly insisting on its perfor,mance. 
 
 It is true that the plaintiff erred in its construction of the contract 
 and as to its liability to make, advances thereunder, and, therefore, that 
 it. had not strictly performed the contract' on its part.! But tiiat did not 
 
Sec. 2) 'INSTALLMENT CONTRACTS 597 
 
 necessarily debar it from relief. Of such a situation this court said 
 by Judge Danforth in Day v. Hunt, 112 N. Y. 191, 19 N. E. 414: 
 "These objections cannot prevail. On the contrary, the very fact that 
 the plaintiff has not strictly performed his part, and so is without rem- 
 edy, at law, is frequently a sufficient reason for the interposition of 
 courts of equity, where relief is given, notwithstanding the lapse of 
 time according to the actual merits of the case. * * * There is 
 nothing to show that either party abandoned the contract or wished or 
 intended to do so. They differed merely as to the form of the mort- 
 gage, and, so far as appears, that difference only prevented the comple- 
 tion of the sale. Although wrong in his, construction as to its proper 
 force, the plaintiff cannot be said to be wholly without excuse." 
 
 There is this further, and to my mind controlling, factor in this case. 
 There had been at least a part performance by the plaintiff and a sub- 
 stantial part, and courts of equity regard with more favor actions to 
 enforce specific performance where there has been performance in 
 part than where nothing has been done by either party, under the con- 
 tract. Thus Mr. Pomeroy writes (Equity Jurisprudence, § 812) of the 
 specific performance of contracts for the sale of land: "But in some 
 cases time almost ceases to be material, as where the vendee has paid 
 the purchase money, or is in possession of the land, it is then said that 
 time does not run against him." While the trial court has found that 
 the defendant notified the plaintiff of its intention to rescind the con- 
 tract, unless its requests were complied with, it must be borne in mind 
 that this notice was of the most general character ; that is to say, that 
 if advances were not more promptly made the defendant would be un- 
 able to fulfill and would give up the contract. Nevertheless, despite 
 these notices, the defendant continued to take such moneys as the 
 plaintiff advanced. Such receipt operated to abrogate any right to re- 
 scind tiiat might then exist. The last payment so made by the plain- 
 tiff was the sum of $5,000 on March 12th. The rule seems to be well 
 settled that though a party to a contract is in default, if the other party 
 Continues to negotiate with him after such default the contract cannot be 
 rescinded without reasonable notice to the party in default to comply 
 with the contract within a specified time. Pomeroy's Eq. Jurisprudence, 
 §815. 
 
 In Webb v. Hughes, L. R. 10 Eq. 281, a contract for the sale of 
 land was to be closed on February 26th. Negotiations were continued 
 after the date set for closing, and on April 7th the purchaser gave notice 
 of immediate abandonment. Specific performance was decreed, the 
 vice chancellor saying : "But, having once gone on negotiating, beyond 
 the time fixed, he is bound not to give irtimediate notice of abandonment, 
 but must give a reasonable notice of his intention to give up his con- 
 tract if a title is not shown." In Parkin v. Thorald, 16 Beavan, 59, no- 
 tice was given on October 21st that the contract must be performed on 
 ilSjovember 5th or otherwise would be abandoned. , Specific performance 
 was decreed, the length of notice being held insufficient. 
 
598 IMPLIED AND CONSTEDCTIVE CONDITIONS PEECEDENT (Ch. 4 
 
 The defendant's letter of March 24th, already recited in full, gave 
 the plaintifif no notice that a certain amount must be paid by a certain 
 time, but merely expressed the! feeling of the defendant that it was 
 "disinclined to continue trying to fulfill the contract on their part, un- 
 less the advances can be more promptly made." This w^as wholly in- 
 sufficient as a notice of the defendant's election to abandon the con- 
 tract unless by a certain time. the plaintiff made the necessary advances. 
 The defendant could not, under the circumstances, rescind the con- 
 tract without notice. We are of opinion, therefore, that the judgments 
 below, were erroneous. It is unfortunate that the case should have 
 been so long in litigation that during its pendency over half of the first 
 contract term has expired. However, in case the plaintiff succeeds on 
 a new trial the court may mold its decree in such form as, in view of 
 the lapse of time and its effect on the interest of the parties, equity may 
 require. 
 
 The judgment appealed from should be reversed, and a new trial 
 granted, costs to abide the final award of costs.' ^ 
 
 HELGAR CORP. v! WARNER'S FEATURES, Inc. 
 (Court of Appeals of New York, 1918. 222 N. 1. 449, 119 N. E. 113.) • 
 
 Action by the Helgar Corporation against Warner's Features, In- 
 corporated. From a judgment of the Appellate Division, modifying 
 and. affirming a judgment entered on a referee's report (171 App. Div. 
 910, 154 N. Y. Supp. 1125), both parties appeal. Affirmed in part and 
 reversed in part. 
 
 Cardozo, J. The plaintiff's assignor made a contract with the de- 
 fendant for the sale of films for moving pictures. At least one film 
 was to be delivered every month. Deliveries, were to begin in Novem- 
 ber, 1913, and to end in October, 1914. The price was fixed at eight 
 cents per foot, and payment for each film was to be made within, 30 
 days after exhibition to the public. By way of additional compensation, 
 the defendant was also to pay one-half of the net profits realized by 
 it as the result of foreign sales. 
 
 The plaintiff, having received an assignment of the contract, de- 
 livered pictures of the value at the contract rate of nearly $10,000. 
 The price was payable on December 24, 1913. The finding is that pay- 
 ment was then demanded, and that "the defendant refused and neg- 
 lected to pay the same or any part thereof, nor did the defendant 
 offer or tender a part payment of said amount or offer to pay the same 
 in installments." Two days later this action was begun. The plain- 
 
 ■fi In accord: Nelson v. San Antonio Traction Co., 107 Tex. 180, 175 S. W. 
 434 (1915), refusal to pay because of a wrong construction of the agreement: 
 Myer t. Wheeler, 65 Iowa, 390, 21 N. "W. 692 (1884). See, also, Fresno Canal 
 & Irr. Co. V. Perrin, 170 Cal. 411, 149 Pac. 805 (1915). 
 
btCZ) I INSTALLMENT CONTRACTS 599 
 
 tiff allege/d its election to terminate the contract by reason of th'e breach. 
 Jvdgmexit was demanded for the price of the films delivered, and also 
 for the^rofits that would have been gained through the completion of 
 the (j^ntract. The referee gave judgment for the price, but refused to 
 awar«i the profits. In his opinion, he put his refusal upon the ground 
 ^ that tlihe failure to make punctual payment was hot accompanied by 
 ' ^'^}^. ?^words evincing repudiation or abandonment. The Appellate 
 Division airrfded $2,000 to the judgment. This was the estimated value 
 of foreign r^hts which attached to the sales already made. That value 
 was thought Vq be recoverable as an incident to the price. With this 
 modification, Vhe judgment was unanimously affirmed. There are 
 cross-appeals iiAi this court. 
 
 The rights of Vendor and vendee upon the breach of an installment 
 contract are nowH regulated by statute. The rule is to be found in sec- 
 tion 126, subdivisi lion 2, of the statute governing sales of goods (Per- 
 sonal Prop. Law> Consol. Laws, c. 41, amended- by L. 1911, c. 571): 
 ' Where there is < g, contract to sell goods to be delivered by stated in- 
 stallments, which \ are to be separately paid for, and the seller makes 
 defective deliverie^U in respect of one or more installments, or the buy- 
 er neglects or refi iges to take delivery of or pay for one or more in- 
 stallments, it depeii^ds in each case on the terms of the contract and the 
 circum'stances of_ the v case whether the breach of contract is so material' 
 as to justify the inju!S||d party in refusing to proceed further and suing 
 for damages for breach ^of the entire contract, or whether the breach 
 is severable, giving rise t(\ a claim for compensation, but not to a right 
 to treat the whole contrac'V as broken." 
 
 The statute thus establis^^es a like test for vendor and for vendee. 
 The earUer cases may not\be wholly uniform. Wharton & Co. v. 
 Winch, 140 N. Y. 287, 35 m. E. 589; Kokomo Strawboard Co. v. 
 Inman, 134 N. Y. 92, 31 N. EV 248; Wolfert v. Caledonia S. I. Co., 
 195 N. Y. 118, 88 N. E. 24, 21 \. R. A. (N. S.) 864. We do not need 
 to reconcile them. We have departed from the rule of the English 
 statute (St. 56 & 57 Vict. c. 71, § ."si, subd. 2), which keeps the contract 
 alive unless the breach is equivalei^nt'to repudiation. Note of Commis- 
 sioners on Uniform Laws, America-in Uniform Commercial Acts, p. 98; 
 Williston on Sales, pp. 809, 810; ^25 Halsbury, Laws of England, p. 
 220. We have established a ne^ te^'st which weighs the effect of the 
 default, and adjusts the rigor of the re. ^edy to the gravity of the wrong. 
 "It depends in each Case on the terms • pf the contract and the circum- 
 stances of the case"^ whether the breach is "so material" as to affect the 
 contract as a whole. >4 
 
 The answer to that question must va^.j-y -(^ith the facts (Williston 
 on Sales, p. 810). Default in respect of on^g installment, though falling 
 short of repudiation, may under some con ditions, be so material that 
 there should be an end to the obligation to ke^ep the contract alive. Un- 
 der other conditions, the default may be notlv-iing but a technical omis- 
 
600 IMPLIED AND CONSTRUCTIVE CONDITIONS PEECEDEIt (Ch. 4 
 
 sion to observe the letter of a promise. Williston on Salet. p. 823; 
 Nat. Machine Co. v. Standard Co., 181 Mass. 275, 279, 63 N.E. 900; 
 Wharton & Co. v. Winch, supra. General statements abound <^hat, at 
 law, time is always of. the essence. Williston, supra; Norrin^n v. 
 Wright, 115 U. S. 188, ,6 Sup. Ct. 12, 29 1,. Ed. 366; Booth v. W^ 
 Rolling Mills Co., 60 N. Y. 487; Schmidt v. Reed, 132 N. Y. 1« 30 
 N. E. 2>72>. For some purposes this is still true. The vendor whpajic; J 
 to receive payment of an installment the very day that it iftiue may 
 sue at once for the price. But it does not follow that he maybe equally 
 precipitate in his election to declare the contract at an eny. Williston, 
 p. 823 ; Beatty v. Howe Lumber Co., 77 Minn. 272, 79j^. w. 1013, 
 and cases there cited; Graves v. White, 87 N. Y. 463, ^5. That de-, 
 pends upon the question whether the default is so substantial and im- 
 portant as in truth and in fairness to defeat the esseii^i purpose of 
 the parties. Whatever the rule may once have been, tH-J js the test that 
 is now prescribed by statute. The failure to make p^^ctual payment 
 may be material or trivial according- to the circumstffi(-es. We must 
 know the cause of the default, the length of the dely^ the needs of 
 the vendor, and the expectations of the vendee. If *ie default is the 
 result of accident or misfortune, if there is a reasonaflg assurance that 
 it will be promptly repaired, and if immediate paymej^ jg not necessary 
 to enable the vendor to proceed with performance/*there may be one 
 conclusion. If the breach is willful, if there is nc^ust ground to look 
 for prompt reparation, if the delay has been sqjfltantial, or if the needs 
 of the vendor are urgent so that continued Performance is imperiled, 
 in these and in other circumstances, there m^y j^e another conclusion. 
 Sometimes the conclusion will follow from aj the circumstances as an 
 inference of law to be drawn by the jud^^. sometimes, as an infer- 
 ence of fact to be drawn by the jury. ^ 
 
 The findings in this case do not ena^i^ ^g to say that the plaintiff 
 was justified in its precipitate election ^^ declare the contract at an 
 end. There is a finding that payment /^^s refused. That is inconclu- 
 sive by itself. The refusal may have ^een nothing more than a decla- 
 ration of inability to make payment c^^ the instant. There is a finding 
 that the defendant did not offer paj.^ payment or payment in install- 
 ments. That again is inconclusive., j^ jg not an ultimate, but at most 
 an evidentiary, fact. The cixcnms^^^^^^^ ^^^ none the less have indi- 
 cated a temporary default to be.-fojio^e^ promptly by full payment. 
 The referee must have interpreter ^j^g situation in that way, for he states 
 in his opmion that the default w^g ^ot accompanied by any act or decla- 
 ration that would mdicate abai:,jQnment. If we were at Hberty to look 
 into the evidence and draw oi^^. ^^^ inferences we might reach a con- 
 trary conclusion.. But the &y,^^^^^ jg not open to our scrutiny. The 
 plaintiff has not requested th; ^^^^^^^ ^^ ^^d the ultimate fact on which 
 the right to the recovery of ^^^^^^^^ depends. It has not requested a find- 
 ing, that the breach was sft, j^aterial as to justify its hasty election to 
 
Sec. 2) INSTALLMENT CONTRACTS ; 601 
 
 declare the contract at an end. It has not requested a finding of the 
 circumstances preceding or acGompanying the default. There is not 
 even a request which brings before us in due form the ruUng that all 
 profits must be excluded. The only request made specifies the extent 
 of the loss, and includes elements of damage which the referee, in any 
 view of the breach, was at liberty to reject. In these circumstances, we 
 must hold the plaintiff to, the rule \vhich requires a request to -find and 
 an exception. Sherman v. Foster, 158 N. Y. 587, 597, 53 N. E. 504 ; Os- 
 trander v. Hart, 130 N. Y. 406, 414, 29 N. E. 744; Bumap v. Nat. Bank 
 of Potsdam, 96 N. Y. 125, 131 ; Thomson v. Bank of B. N. A., 82 N. Y. 
 1 ; Drake v. N. Y. Iron Mine, 156 N. Y. 90, 50 N. E. 785. The findings 
 as made leave the character of the default equivocal. In the absence 
 of an appropriate request for other findings, the evidence is not before 
 us. The rule would be different if we were asked to go behind the find- 
 ings for the purpose of affirmance. Ogden v. Alexander, 140 N. Y. 
 356, 35 N. E. 638; Ostrander v. Hart,' supra. The plaintiff asks us to 
 go behind them for the purpose of reversal. Its appeal must therefore 
 fail. 
 
 The defendant complains, of the increase of the judgment directed 
 at the Appellate Division. We think the increase was erroneous. We 
 have seen that the plaintiff was not at liberty to treat the entire con- 
 tract as broken. Its cause of action was limited to the recovery of 
 payments in default. But there has thus far been no default in respect 
 of foreign sales. No foreign sales have yet been made. The award 
 in that respect is an estimate of sales to be made hereafter. Until the 
 conditions prescribed by the contract have been satisfied, the extra com- 
 pensation is not payable. The plaintiff's recovery must be limited to 
 payments already due. 
 
 The judgment of the Appellate Division to the extent that it modifies 
 the judgment entered on the report of the referee should be reversed, 
 and the judgment entered upon such report affirmed, with costs in this 
 •court to the defendant. 
 
 LOS ANGELES GAS & ELECTRIC CO. v. AMALGAMATED 
 
 OIL CO. 
 
 (Supreme Court of California, 1909. 156 Cal. 776, 106 Pac. 55.) 
 
 Action by the Los Angeles Gas & Electric Company against the 
 Amalgamated Oil Company. From a judgment of nonsuit, plaintiff ap- 
 peals. Affirmed. 
 
 Sloss, J. Action to recover damages for an alleged breach of con- 
 tract. At the trial the defendant's motion for nonsuit was granted 
 and a judgment of dismissal entered. From this judgment plaintiff 
 appeals. 
 
 ' The contract involved was in writing, and was executed by the As- 
 sociated Oil Company, as party of the first part, and the Los Angeles 
 
602 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 Gas &, Electric Gbmpany, the plaintiff herein, as party of the second 
 part. The defendant Amalgamated Oil Company succeeded to all the 
 rights and obHgations of the Associated Oil Company under the 
 contract, and may, for the purposes of this discussion, be considered 
 as having in the first instancy entered into said contract with plaintiff. 
 In the interest of brevity, we shall herein designate the plaintiff as 
 the "gas company" and the defendaftt as the "oil company." 
 
 By the terms of the contract, which is dated the 1st day of February, 
 1905, the oil company agrees to sell and deliver to the gas company, 
 and the latter agrees to purchase and receive from the forrfier, a suffi- 
 cient quantity of crude oil to operate all plants now or hereafter to be 
 operated by the gas company in its business of manufacturing gas and 
 electricity in the city of Los Angeles 6ver and above the amounts here- 
 tofore contracted for to be delivered to the gas company by others 
 than the oil company during the term of the contract. The term of 
 the agreement is declared to be from February 1, 1905, to December 
 31, 1910, inclusive; In addition to- various provisions regarding the 
 character of oil to be furnished, the manner of delivery, and deduc- 
 tions for impurities, the contract provides that the gas company shall 
 give three days' notice of its requirements, and fixes the purchase 
 price at 45 cents per barrel, payments to be made on the 15th day of 
 each month for all oil delivered during the preceding calendar month. 
 
 The complaint alleges that, after making various deliveries during 
 the years 1905 and 1906, the defendant on December 31, 1906, noti- 
 fied the plaintiff that it no longer considered itself bound by the con- 
 tract. On several occasions during January and February, 1907, the 
 gas company, plaintiff, requested and demanded of the defendant oil 
 company that it furnish and deliver to plaintiff a quantity, of crude oil 
 aggregating 24,700 barrels. Of this amount 11,616 barrels was the 
 quantity of oil sufficient (over and above the oil otherwise contracted 
 for as provided in the aforesaid contract) to operate plaintiff's plants. 
 The plaintiff, it is alleged, has duly performed all the obligations im- 
 posed on it under the contract ; but defendant has refused to deliver 
 any of the oil demanded during said months of January and February, 
 1907: The lowest market value of oil of the quality described in the 
 contract since the 1st day of January, 1907, was 75 cents per barrel. 
 The prayer of the complaint is for $3,484.80, being the difference be- 
 tween the contract price and the market value of the 11,616 barrels, 
 which, as plaintiff claims, the defendant should have delivered. 
 
 Of the answer it will be sufficient to say that it denies that "plain- 
 tiff has duly, or at all, performed all, or any, of the obligations impos- 
 ed on it under the said contract." 
 
 At the trial there was tio dispute about the terms of the contract, 
 the refusal to deliver on demand as alleged, or the market value of 
 oil at and after the refusal. The gas company did not, however, make 
 any attempt to show that it had during the period prior to January, 
 1907, demahded or received from the oil company, a quantity of oil 
 
Sec. 2) INSTALLMENT CONTRACTS 603 
 
 (over and above amounts otherwise contracted for) sufficient to oper- 
 ate its plants. The motion for a nonsuit was based on the failure to 
 produce evidence on this point, and, stating the same proposition in 
 more general terms, that plaintiff had failed to prove its allegation that 
 it had duly performed all the obligations imposed on it under said 
 contract. 
 
 By the agreement the gas company agreed to take of the oil com- 
 pany, and pay for, all the oil required by it over and above specified 
 exceptions. The oil company agreed to deliver, as called for, all such 
 oil at a given price. If the contract is to be construed as entire with 
 respect to these covenants — ^in ; other words, if such covenants were 
 mutually dependent — the court below was clearly right in holding that 
 plaintiff could not recover for a failure to deliver without alleging 
 and showing either performance, or a sufficient excuse for the non- 
 performance, of its obligation to take of defendant all oil required to 
 operate its gas and electric plants. Daley v. Russ, 86 Cal. 115, 24 Pac; 
 867; Easton v. Montgomery, 90 Cal. 307, 318, 27 Pac. 280; 25 Am. 
 St. Rep. 123; Marchant v. Hayes, 117 Cal. 670, 49 Pac. 840. 
 
 The appellant's contention is that the contract was severable into 
 as many distinct agreements of sale as there were months in the term 
 during which deliveries were to be made. We do not regard this po- 
 sition as tenable. Whether a contract is entire or severable is a ques- 
 tion of interpretation. The intent of the parties is to be ascertained 
 from a consideration of the language employed and the subject-matter 
 of the contract. 2 Parsons' Contracts, (9th Ed.) 672 ; Sterling v. Greg- 
 or)', 149 Cal. 120, 85 Pac. 305. It is, no doubt, well settled, as has 
 been repeatedly declared by tiais court, that "when the price is express- 
 ly apportioned by the contract, or the apportionment may be implied 
 by law, to each item to be performed the contract will generally be 
 held to be severable." More v. Bonnet, 40 Cal. 251, 6 Am. Rep. 621 ; 
 Ilerzog V. Purdy, 119 Cal. 99, 51 Pac. 27; Sterling v. Gregory, su- 
 pra. But this rule is not universal It is subject to the limitation that 
 a contract will be treated as entire, even when the obligations of the 
 one party consist of different acts to be separately paid for, where the 
 nature and character of the agreement show that it was intended to 
 be entire. Thus, in Norris v. Harris, 15 Cal. 227, Field, C. J., said: 
 "But a contract, made at the same time for different -articles at differ- 
 ent prices is not an entire contract, unless the taking of the whole is 
 essential from the character of the property, or is made so by the 
 agreement of the parties. * * *" 'Similarly, in Wooten v. Wal- 
 ters, 110 N. C. 251, 14 S. E. 734, 736, cited by this court in Sterling 
 V. Gregory, supra, the "more reasonable rule" is said to be that, 
 "where there is a purchase of different articles at different prices at 
 the same time, the contract would be severable as to each article, un- 
 less the taking of the whole was rendered essential either by the nature 
 of the subject-matter or by the act of the parties." 
 
 In the case of the contract before us, v/e have no doubt that the 
 
604 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Gh: 4 
 
 subject-matter and the stipulations of the parties were such as to 
 make the taking of the oil contracted for essential to the right to de- 
 mand further deliveries. The seller tmdertakes to hold itself in readi- 
 ness to meet all the requirements of the buyer and to fill these require- 
 ments at a given price. In return it has the privilege of supplying at 
 that price all oil that the buyer may require for its plant. These pro- 
 visions—the obligation to furnish and the obligation to take all oil 
 needed — are necessarily reciprocal. Each goes to the essence of the 
 agreement. It is not to be supposed that the oil company would have 
 been willing to hind itself to furnish oil for a term of years at 45 
 cents a barrel, regardless of the actual state of the market, unless it 
 had been assured a continuous outlet for a large quantity at that fig- 
 ure. And, on the other hand, the gas company was, as must be as- 
 sumed, undertaking to buy oil of the oil company at a fixed price in 
 view of the fact that it was by the agreement securing a steady supply 
 which would be sufficient f on all its needs. To hold such a contract 
 severable would open the way to great hardship and injustice. Either 
 party could refuse compliance with the agreement when it desired, 
 and still hold the other when conditions made such course advanta- 
 geous. The one in default would, to be sure, be liable in damages 
 for its breaches of the several contracts, but such liability would be 
 far from an adequate protection to the other party. Let us suppose, 
 for example, that for a period of two years after the making of the 
 contract the market value of oil should be less than the contract price, 
 and that during that time the gas company should find it to its interest 
 to fill its requirements by purchasing of others than the defendant. 
 In such event, the oil company would, under appellant's contention, 
 be bound to continue to hold itself in readiness, during the entire term 
 of the contract, to furnish oil if called for, and to seek its only relief 
 for past breaches by actions for damages. While it could not know 
 whether its future output would or would not be taken by the gas 
 company, it could not safely enter into any contract to dispose of 
 that output to others. Such construction of the contract would pro- 
 duce great confusion and uncertainty and would, to a great extent, 
 deprive the parties of the substantial benefit of the respective cove- 
 nants to take and to furnish all oil required. 
 
 The fact that the gas company does not agree to take any specified 
 quantity of oil is of no consequence. It agrees to take all that may be 
 needed in the operation of its plants. The exact quantity is subject 
 to fliictuation with the conditions of its business, but the seller does not 
 thereby forfeit the right to insist on furnishing all that shall be actu- 
 ally required. The agreement does not, in respect to the point under 
 discussion, differ from one for the purchase and sale of a fixed quan- 
 tity to be delivered and paid for in installments. While there is some 
 conflict among the decided cases, the great weight of authority, at 
 least in the United States, supports the proposition that such agree- 
 ments are entire, and that a refusal without sufficient cause by the 
 
Sec. 2) INSTALLMENT CONTRACTS . . 605 
 
 seller to furnish, or by the buyer to take or pay for, any installment, 
 justifies a repudiatioh of the contract by the party not in default. 2 
 Mechem on Sales, §§ 1144-1148. The rule has been appHed alike to 
 contracts for the sale of fixed quantities and to those calling for the 
 delivery of amounts to be fixed by the requirements of the buyer's 
 plant or business. Norfington v. Wright, 115 U. S. 188, 6 Sup. Ct. 
 12, 29 L. Ed. 366; Williams Cooperage Co. v. ScofieW, 115 Fed. 119, 
 ^3 C. C. A. 23; Loudenback Fertilizer Co. v. Tennessee Phosphate 
 Co., 121 Fed. 298, 58 C. C. A. 220, 61 h. R. A. 402; Kokomo ^^traw- 
 board Co. v. Inman, 134 N. Y. 92, 31 N. E. 248; George H. liess 
 Co. V. Dawson, 149 111. 138, 36 N. E. 557; King Phillip Mills v. Sla- 
 ter, 12 R./l. 82, 34 Am. Rep. 603; . Providence Coal Co. v. Coxe, 19 
 R. I. 380, 35 Atl. 210; Wllam v. Wright, etc., Co., 196 Mass. 474, 82 
 N. E. 711; Pacific Lumber Co. v: Iowa W. & P. Co., 35 Iowa, 308, 
 112 N. W. 771 ; Ross Meehan F. Co. v. Royer Wheel Co., 113 Tenn. 
 370, 83 S. W. 167. The same conclusion has been reached by this 
 court in two cases. In Twomey v. People's Ice Co., 66 Cal. 233, 5 
 Pac. 158, the defendant agreed to furnish ice to plaintiffs for one 
 year at the rate of $5 a ton; the vendor agreeing to sell ice to plain- 
 tiffs alone, and the plaintiffs agreeing to take ice from the defendant 
 alon? during the term of the contract. The plaintiffs having broken 
 the contract by purchasing ice from third parties, it was held that this 
 breach released defendant from any further performance. To the 
 same effect, substantially, is Dunn v. Daley,, 78 Cal. 640, 21 Pac. 377. 
 
 The holding that the contract is entire with respect to the covenants 
 we have been discussing is in no wise inconsistent with the view that 
 it is apportionable with respect to payments for oil actually delivered. 
 2 Parsons' Contracts (9th Ed.) 673, note. An action could be main- 
 tained for the price of any delivery as soon as it became due. This 
 is the holding, and the "extent of the holding in Veerkamp v. Hulburd, 
 etc., Co., 58 Cal. 229, 4r Am. Rep. 265. But, as we have said, the con- 
 tract may be entire with i-egard to the obligations to buy and sell the 
 whole amount contracted for, notwithstanding the fact that paymeijt 
 for installments actually delivered may be enforced separately. Dunn 
 V. Daley, supra; Barrie v. Earle, 145 Mass. 1, 8 N. E. 639; 58 Am. 
 Rep. 126; Milske v. Mantel Co., 103 Md. 235, 63 Atl. 471,5 L. R. A- 
 (N. S.) 1105, 115 Am. St. Rep. 354. 
 
 For these reasons it must be held that the motion for nonsuit was 
 rightly granted. 
 
 The judgment is affirmed." 
 
 '2 Southern Colonization Co. v. Derfler, 73 Fla. 924, 75 South. 790, L. R. A. 
 1917F, 744 (1917) is an interesting case, where a partial nonperformance 
 ''went to the essence." 
 
606 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 (d) Performance ON Time as a Condition , 
 
 BECK & PAULI LITHOGRAPHING CO. v. COLORADO 
 MILLING & EL:^VAT0R CO. 
 
 (Circuit Court of Appeals of the United States, 1892. 52 Fed. 700, 3 C. 
 
 C. A. 248.) 
 
 In Error to the Circuit Court of the United States for the District 
 of Colorado. Reversed. . . ' 
 
 This was an action by the plaintiff in error to recover the contract 
 price of certain stationery and advertising matter furnished the 
 defendant. ^ It was tried on the merits, and at the close 'of the evi- 
 dence the court ihstriitted, the jury to rettirti a verdict for the defend- 
 ant, and, this instruction is assigned as error. The plaintiff was a cor- 
 poration of Wisconsin, engaged in lithographi;cig and pri|iting, and its 
 principal place of business was at Milwaukee, in that state. The de- 
 fendant was a corporation of Colorado, engaged in the business of niill- 
 ing, and its principal place of business was at Denver, in that state. In 
 June, 1889, the plaintiff agreed to make new designs of certain, build- 
 ings of defendant, with sketches of its trade-marks; to execute en- 
 gravings thereof in a strictly first-class' style; to embody these on the 
 stationery described below; to submit to defendant for approval proofs 
 thereof ; to submit designs and proofs of hangers, on fine chromo plate, 
 for advertising defendant's business, by the following fall; to engrave 
 a strictly first-class vignette of one of defendant's plants ; to submit a 
 sketch and proof thereof to defendant; to furnish defendant with 
 10,CXX) business cards and 5,000 checks in August, 1889 ; to furnish, 
 in the course of the year, letter heads, noteheads, bill heads, statements, 
 bills, envelopes and cards to the defendant to the number of 331,100, 
 and 5,000 hangers ; and to . furnish the vignette and 5,000 hangers 
 more after the approval of the proofs (thereof by the defendant. The 
 defendant agreed to take and pay for this stationery, this vignette, and 
 these hangers at certain agreed prices, which amounted in the aggre- 
 gate to about $6,000. The plaintiff furnished the 10,000 cards and 
 5,000 checks required under the contract in August, 1889, and the 
 defendant received and paid for them. The plaintiff introduced tes- 
 timony to the effect that it strictly complied with and fully performed' 
 these contracts in every respect, except that it shipped the articles; con- 
 tracted for (which were not delivered in August) by rail from Milwau- 
 kee to the defendant, at Denver, in December, 1889, in five boxes, four 
 of which did not arrive at Denver until 9:42 a. m., January 1, 1890, 
 and the fifth did n'ot arrive there until January 4, 1890 ; that before 
 January 8, 1890, all of these articles were tendered to the defendant, 
 and it refused to examine or receive them ; that the sketches and proofs 
 of the designs, trademarks, and hangers had been submitted to and 
 approved by the defendant during the summer and fall of 1889, before 
 
Sec. 2) PEBFORMANCE ON TIME AS A CONDITION ' 607 
 
 these articles were manufactured, and that the last proof was approved 
 November 16, 1889; that on December 16, 1889, the defendant wrote 
 the plaintiff to forward by express 2,000 statements and 3,000 envelopes 
 "as per proofs submitted ;" that the state of the art and process of lith- 
 ographing is such that, after the general idea of a piece of work is 
 conceived, it is customary to make first a pencil design, and, when this 
 is fciund satisfactory, to prepare a colored sketch where colored work 
 is required; that after the sketch is colored it is lithographed, that 
 is, transferred to a stone; that each color requires a separate stone; 
 and in these hangers there were nine colors ; that it requires from two 
 to three months to reproduce on stone a colored sketch like that used 
 for the hangers ; that the artists' work and the reproduction on stone 
 were the most expensive parts of this work contracted for ; knd that 
 the expense of the materials and printing was but a small part of the 
 entire expense of the work. 
 
 Sanborn, Circuit Judge (after stating the facts). The ground on 
 which it is sought to sustain the instruction of the court below to 
 return a verdict for the defendant in this case is that the plaintiff 
 failed to tender or deliver the articles contracted for to the defendant, 
 at Denver, until six or eight days after the expiration of the year, that 
 the plaintiff did not therefore furnish them "in the course of the year," 
 and that this failure justified the defendant in repudiating the contract, 
 and refusing to pay any part of the contract price. 
 
 It is a general principle governing the construction of contracts that 
 stipulations as to the time of their performance are not necessarily 
 of their essence, unless it clearly appears in the given case from the ex- 
 press stipulations of the contract or the nature of its subject-matter that 
 the parties intended performance within the time fixed in the, contract 
 to be a condition precedent to its enforcement, and, where the intention 
 of the parties does not so appear, performance shortly after the time 
 limited on the part of either party will not justify a refusal to perform 
 by the party aggrieved, but his only remedy will be an action or coun- 
 terclaim for the damages he has sustained from the breach of the stip- 
 ulations. In the application o,f this principle to the cases as they have 
 arisen, in the promulgation of the rules naturally deduced from it, and 
 in the assignment of the various cases to the respective classes in which 
 the stipulation as to time of performance is, or is flot, deemed of the 
 essence of the contract, the controlling consideration has been, and 
 ought to be, to so decide and classify the cases that unjust penalties 
 may not be inflicted, nor unreasonable damages recovered. Thus, in the 
 ordinary contract of merchants for the sale and delivery, or the manu- 
 facture and salt, of marketable commodities within a time certain, it has 
 been held that performance within the time is a condition precedent to 
 the enforcement of the contract, and that a failure in this regard Would 
 justify the aggrieved party in refusing performance at a later day. 
 Norringtbn V. Wright, 115 U. S. 188-203, 6 Sup. Ct. 12, 29 L. Ed. 366. 
 
608 IMPLIED AND CONSTllUCTITE CONDITIONS PKECBDENT (Ch, 4 
 
 This application of. the general principle commends itself as just and 
 reasonable, on account of the frequent and rapid interchange, and use 
 of such commodities made necessary by the demands of commerce, 
 and because such goods, if not received in time by the vendee, may 
 usually be sold to others by the vendor at sfnall loss, and thus he may 
 himself measure the damages he ought to suffer from his delay by 
 the difference in the market value of his goods. On the other hand, it 
 has been held that an express stipulation in a contract for the con- 
 struction of a house, that it should be completed on a day certain, and 
 that, in case of failure to complete it within the time limited, the builder 
 would forfeit $1,000, would' not justify the owner of the land on which 
 the house was constructed in refusing to accept it for a breach of this 
 stipulation when the house was completed shortly after the time fixed, 
 nor even in retaining the penalty stipulated in the contract, but that he 
 must perform his part of the contract, and that he could retain from 
 or recover of the builder the dcunages he sustained by the delay and 
 those only. Tayloe v. Sandiford, 7 Wheat. 13, 17, 5 h. Ed. 384. This 
 application of the general rule is equally just and reasonable. The 
 lumber and material bestowed on a house by a builder become of lit- 
 tle comparative value to him, while they are ordinarily of much greater 
 value to the owner of the land on which it stands, and to permit the lat- 
 ter to escape payment because his house is completed a few days later 
 than the contract requires would result in great injustice to the contrac- 
 tor, while the rule adopted fully protects the owner, and does no injus- 
 tice to any one. The cases just referred to illustrate two well-settled 
 rules of law which have been deduced from this general principle, and 
 in accordance with which this case must be determined. They are: 
 
 In contracts of merchants for the sale and delivery or for the manu- 
 facture and sale of marketable commodities a statement descriptive of 
 the subject-matter, or some material incident, such as the time of ship- 
 ment, is a condition precedent, upon the failure or nonperformance of 
 which the party aggrieved may repudiate the whole contract. Norring- 
 ton V. Wright, lis U. S. 188, 203, 6 Sup. Ct. 12, 29 L. Ed. 366 ; Rolling 
 Mill V. Rhodes. 121 U. S. 255, 261, 7 Sup. Ct. 882, 30 L,. Ed. 920." 
 But in contracts for work or skill, and the materials upon which it 
 is to be bestowed, a statement fixing the time ,of performance of the 
 contract is not ordinarily of its essence, and . a failure to perform 
 within the time stipulated, followed by substantial performance after a 
 short delay, will not justify the aggrieved party in repudiating the entire 
 contract, but will simply give him his action for damages for the breach 
 of the stipulation., Tayloe v. Sandiford, 7 Wheat. 13, 17, 5, L. Ed. 384; 
 Hambly v. Railroad Co. (C. C.) 21 Fed. 541, 544, 554, 557. 
 
 '8 In accord: McGowin Lumber & Export Co. v. Camp Lumber Co., 16 
 Ala. App. 283, 77 South. 433 (1918) ; Clark v. Fey, 121 N. Y. 470, 24 N. E. 703 
 (1890) ; Davison v. Von Lingen, 113 U. S. 40, 5 Sup. Ct. 346, 28 L. Ed. 885 
 
 (1885). 
 
Sec. 2) PEKFORMAXCE ON TIME AS A CONDITION 609 
 
 It only remains to. determine whether the contracts in "the" case at 
 bar are the ordinary contracts of merchants for the manufacture and 
 sale of marketable commodities or contracts for labor, skill, and mate- 
 rials, and this is not a difficult task. A contract to manufacture and 
 furnish articles for the especial, exclusive, and peculiar use of another, 
 with special features which he requires, and which render them of val- 
 ue to him, but useless and unsalable to others, — articles whose chief 
 cost and value are derived from the labor and skill bestowed upon 
 them, and not from the materials of which they are made, — is a con- 
 tract for work and labor, and not a contract of sale. Engraving Co. v. 
 Moore, 75 Wis. 170, 172, 43 N. W. 1124, 6 L. R. A. 788, 17, Am. St. 
 Rep. 186; Goddard v. Binney, 115 Mass. 450, 15 Am. Rep. 112; Hinds 
 V. Kellogg (Com. PI.) 13 N. Y. Supp. 922 ; Turner v. Mason, 65 Mich. 
 662, 32 N. W. 846. 
 
 [The Court then held that this contract was governed by the second 
 rule and that performance exactly on time was not a condition preced- 
 ent. The judgment of the lower court was reversed.] '* 
 
 KING et al. v. CONNORS et al. 
 I Supreme Judicial Court of Massachusetts, 1915. 222 Mass. 261, 110 N. E. 289.) 
 
 CarrolIv, J. In March, 1913, the plaintiff s agreed to sell and the de- 
 fendants to buy the hotel property of the plaintiffs in Greenfield, 
 Massachusetts, "on or before May first next, for the sum of thirty 
 thousand dollars." One thousand dollars was deposited with Charles 
 H. Keith "on account of the purchase price of said property." The 
 remainder was to be paid as follows : "Fourteen thousand dollars in 
 cash * * * upon the delivery of a good and sufficient warranty 
 deed of the premises, clear of all incumbrances except taxes assessed 
 April 1, 1913, on or before the first day of May next, and the balance 
 of the purchase price, viz., fifteen thousand dollars, is to be paid 
 * * * by mortgage on the premises." 
 
 The agreement was in writing, and in addition to the real estate 
 ^therein described it included all the personal property in the hotel, with 
 the exception of that in three rooms over the barroom and a few other 
 articles specially mentioned ; it further provided that if the defendants 
 failed to comply with its conditions the one- thousand dollars already 
 deposited with Keith was to be paid to the plaintiffs, "in full as agreed 
 upon and liquidated damages." 
 
 ^* See, also, Thurston v. AiTo'd. 43 To^'a. 43 fl87fi> : Coleman v. Apple- 
 garth, 68 Md. 21, 11 Atl. 284, 6 Am. St. Kep. 417 (1887) ; Hubbell v. Von- 
 Schoening, 49 N. Y. 326 (1872) ; Austin v. Wacks, 30 Minn. 335, 15 N. W. 409 
 (1883),. 
 
 Beginning work on time is not a condition precedent, where it does not 
 appear that the completion will also be late. Kenedy Town & Improvement 
 Co. V. First Nat. Bank (Tex. Civ. App.) 136 S. W. 558 (1911). 
 
 COKBIN CONT 39 
 
610 IMPLIED AND CONSTRUCTIVE CONDITIONS PEECEDBNT (Ch. 4 
 
 May 1, 1913, the plaintiffs were not ready and able to perform. On 
 the second day of May, however, they were ready and able to fulfill 
 the terms of the sale. On the morning of that day they notified the 
 attorney for the defendant of their ability and desire to act and were 
 told it was too late, that the sale should have been completed on the 
 first day of May, and the plaintiffs having failed in this respect, the 
 defendants were therefore excused from performance. 
 
 Thereupon this bill in equity was brought to specifically enforce the 
 contract. The facts being found by a master, a decree was entered 
 in the superior court dismissing the bill. 
 
 In equity, under an agreement like the one before us, time is not 
 considered of the essence of the contract unless it expressly so appears 
 or is to be implied from the surrounding circumstances. Mansfield 
 V. Wiles, 221 Mass. 75, 108 N. E. 901; Lennon v. Napper, 2 Sch. 
 & L. 681, 684. See Law Quarterly Review, July, 1915, p. 253. The 
 written instrument contained no express stipulation making the time 
 stated of the essence of the contract, and there is nothing in the terms 
 of the contract, in the nature of the property to be conveyed, or in the 
 existing circumstances, which requires an inference that the parties 
 intended May first, 1913, to be the necessary and essential time for 
 carrying the sale into .effect. 
 
 On the second day^ of May the plaintiffs' tenant had not surrendered 
 the lease of a portion of the premises occupied by him, although it 
 was agreed that the premises were to be free of all incumbrances. 
 The tenant, however, had promised in writing to execute a release 
 and surrender the premises whenever required, within thirty days. 
 This was a sufficient compliance with the contract. Mansfield v. Wiles, 
 supra ; Richmond v. Gray, 3 Allen, 31 ; Dresel v. Jordan, 104 Mass. 
 407, 415. 
 
 It follows that the decree must be reversed and a decree entered for 
 the plaintiff, the terms of which are to be settled by a judge of the su- 
 perior court. 
 
 So ordered.''^ 
 
 LORD RANELAGH v. MELTON. 
 (In the High Court of Chancery, 1864. 2 Drew. & S. 278.) 
 -This was a suit for specific performance. 
 
 By articles of agreement, bearing date the 22d day of December, 
 1857, the defendant, William Melton, agreed to lease certain plots 
 
 '5 In accorci: Jaeger v. Shea, 130 Md. 1, 99 Atl. 964 (1917). If time was 
 made expressly of the essence, specific performance will not be decreed when 
 an installment of the price was tendered 20 days late, although relief is 
 granted as against the specified penalty. Steedman v. Crinkle, [1916] 1 A. C. 
 275. If the condition has been waived, specific performance may be decreed. 
 Jfllmer v. B. 0. Orchard Lands, [1913] A. C. 319. Where time has ceased to 
 be of the essence by waiver, it ipay again be made so by notice. See note under 
 "Waiver," p. 837. 
 
Sec. 2) PERFORMANCE ON TIME AS A CONDITION 611 
 
 of land in Richniond Road, Round Hill Park, Brighton, to Henry 
 Banks and Joseph Vinall, for a term of ninety-nine years from June, 
 1856, subject to certain ground-rents ; and the articles of agreement 
 contained the following clause; 
 
 "In case, at any time within the space of seven years from the 23d 
 day of June, 1856, the lessees shall be desirous of purchasing the fee 
 simple and inheritance of all or any one of the said plots of ground, 
 and of such their desire shall give three months notice to the lessor, and 
 shall, at the expiration of such notice pay unto him the sum of £210 
 in respect of each plot mentioned in such notice, and all rent payable 
 to and including the current quarter, then the lessor shall and will con- 
 vey the freehold and inheritance of the plot or plots mentioned in 
 such notice unto and to the use of the lessees, or as they shall appoint." 
 
 The articles of agreement provided that the terms lessor and lessee, 
 as used therein, should apply to their assigns in the event of either 
 party disposing of his interest in the premises. 
 
 The articles of agreement also provided that the lessees, in exercising 
 their option to purchase, should not inyestigate the title of the lessor 
 to the premises. 
 
 The interest of the lessees. Banks and Vinall, subsequently became 
 vested in the present plaintiffs. 
 
 The plaintiffs being desirous of exercising their right, under the 
 clause in the articles of agreement, of purchasing from the defendant 
 the fee simple and inheritance in the said plots of land, on the 20th 
 day of March, 1863, served on the defendant notice, as provided by 
 the articles of agreement, of their desire so to do. It was admitted 
 that this notice was regular in' all respects. After the service of this 
 notice, some communications took place between the parties, in the 
 course of which the defendant expressed his wish to have the draft 
 conveyances sent to him for perusal. 
 
 The period of three months from the date of the notice expired 
 on the 20th of June, and the seven years from the date of the articles 
 of agreement expired' on the 24th of June, but nothing further took 
 place till the 1st of July, when the plaintiff!s solicitor sent the defendant 
 draft conveyances for his perusal. 
 
 On the receipt of these draft conveyances the defendant wrote the 
 plaintiff's solicitor .that he did not consent to excuse the default to 
 complete on or before the 20th or 24th day of June; and finally, 
 on this ground, the defendant refused to complete the sale to the 
 plaintiffs of the fee in the said plots of land. It appeared that tl^e 
 purchase-money had never been tendered. 
 
 Under these circumstances, the plaintiffs filed their bill to enforce 
 specific performance, by the defendant, of the agreement to sell the 
 fee simple to them. 
 
 The cause now came on upon motion for a, decree. 
 
 The VicE-Chancei,i.or (Sir R. T. KindERSIvBy). I apprehend the 
 rule of law applicable to cases like the present is perfectly clear. No 
 
G12 IMPLIED AND CONSTRUCTI'UB CONDITIONS PRECEDENT (Ch. 4 
 
 doubt, if an owner of land and an intending purchaser enter into a 
 contract constituting between them the relation of vendor and pur- 
 chaser, and there is a stipulation in the contract that the purchase- 
 money shall be paid and the contract completed on a certain day, this 
 Court in ordinary cases has established the principle that time is not of 
 the essence of the contract, and that the circumstance of the day fixed 
 for the payment of the money and completion of the purchase being 
 past does not entitle either party to refuse to complete. On the other 
 hand, it is well settled that where there is a contract between the owner 
 of land and another person, that if such person shall do a specified 
 act, then he (the owner) will convey the land to him in fee ; the relation 
 of vendor and purchaser does not exist between the parties tmless and 
 until the act has been done as specified. The Court regards it as the 
 case of a condition on the performance of which the party perform- 
 ing is entitled to a certain benefit ; but in order to obtain such benefit 
 he must perform the condition strictly. Therefore, if there be a day 
 fixed for its performance, the lapse of that day without its being 
 performed prevents him from claiming the benefit. Applying that 
 rule to the present case : if the agreement fixes a day for the payment 
 of the money, then it is clear that if that day is past without the pay- 
 ment, the right to compel a conveyance is lost. 
 
 The question then is, whether any time is fixed in this agreement for 
 the payment of the money. The language is, that if ^e lessees shall 
 at the expiration of three months after the notice (which notice was 
 duly given) pay the money, then the lessor shall convey the freehold 
 and inheritance ; and the matter resolves itself into a question of con- 
 struction, — ^What is the meaning of the words "at the expiration of 
 three months ? " 
 
 The plaintiffs contend that these words mean, not at the time at 
 which the three months expire, but at any time afterwards. If that 
 be the true construction, the consequence would be, that not only a 
 day or a week after, but a year or any number of years after the ex- 
 piration of the three months, the plaintiffs would have a right to tender 
 the money and demand a conveyance ; and this is what the law will not 
 permit. But besides that, if the lessees should think fit not to pay 
 thp money, could the owner file a bill to compel them to do so? I 
 apprehend, clearly not ; for there is nothing in the agreement to malce 
 it obligatory on the lessees to pay the money. It is impossible to 
 put such a construction on the words. "At the expiration of three 
 months" must mean, not at any time after such expiration, but on the 
 day on which the three months expire. 
 
 This case is not open to the argument which might arise in ordinary 
 cases between vendor and purchaser, that the investigation of the 
 title would occupy some time, inasmuch as the agreement provides 
 that the lessees shall accept the title ; so that there was nothing to be 
 done but the conveyance. Unfortunately for the plaintiffs, they have 
 
' Sec. 2) PERFORMANCE ON TIME AS A CONDITION 613 
 
 allowed the time limited for the payment of the money to elapse, 
 and therefore they are not entitled to a conveyance. 
 Bill dismissed, with costs. 
 
 WINDERS et al. v. KENAN et al. 
 (Supreme Court of North Carolina, 1913. 161 N. C. 628, 77 S. B. 687.) 
 
 Action by J. B. Winders and others against J. G. Kenan and others. 
 Judgment for defendants, and plaintiffs appeal. Affirmed. 
 
 This is an action to compel specific performance, based upon the 
 following instrument : 
 
 "This agreement, executed this 17th day of January, 1905, by and be- 
 tween Jas. G. Kenan and heirs of O. R. Kenan, of the county of Duplin 
 and state of North Carolina, of the first part, and J. B. Winders and L,. 
 E. Hall of the second part, witnesseth: That said party of the first 
 part for and in consideration of the sum of five hundred dollars to him 
 in hand paid by the said party of the second part, the receipt whereof 
 is hereby fully acknowledged, doth agree that upon the payment of ten 
 thousand ($10,000.00) dollars, two thousand of which is to be paid the 
 1st day of April, 1905, and the remainder in four annual payments with 
 interest at 6 per cent., to give, grant, sell and convey by proper xieed 
 with full warranty, and assure to the said party of the second part, his 
 heirs and assigns, all the trees on the following described tract of 
 land, * * * 
 
 "In witness whereof the said party of the first part hath hereunto set 
 their hands and seal the day and year first written above. 
 
 "James G. Kenan. [Seal.]" 
 [and several others.] 
 
 The probate of this instrument was not complete until April 25, 1905, 
 and it was registered on May 1, 1905. About the 1st of April, 1905, 
 one of the plaintiffs and James G. Kenan, who represented the other 
 makers of the instrument, met in Kenansville for the purpose of hav- 
 ing a deed prepared, and a deed was prepared in accordance with said 
 writing, and at that time the said plaintiff told the said Kenan that he 
 would be ready to make the first payment when the deed was delivered. 
 The probate of the deed was complete about April 10', 1905, and the 
 plaintiffs were notified thereof during the month of April, and not later 
 than April 27th. 
 
 The plaintiff offered evidence tending to prove that between March 
 6 and March 10, 1905, they told the said Kenan that they would take 
 the timber, and for him to prepare a deed, and that the money was 
 ready, and that the said Kenan said that he would have to have a little 
 time, as the parties did not live close together, and that a few days 
 would not make any difference as to the execution of the deed or as to 
 the payment of the money ; that on May 30, 1905, the plaintiff tendered 
 
614 IMPLIED AND CONSTRUCTIVE CONDITIONS PEEOEDENT (Ch. 4 
 
 to the defendant the sum of $1,500, which the defendants: refused to ac- 
 cept, and declared the contract at an end ; that in the fall of 1905 or the 
 spring of 1906 the plaintiffs tendered to the defendants two checks, one 
 in the sum of $2,500 and the other in the sum of $9,220, which were 
 refused ;• that on February 28, 1908, the plaintiffs tendered to the de- 
 fendants $2,240, which was refused ; that in March, 1909, the plaintiff 
 tendered to the defendants the sum of $2,120, which was refused ; that 
 during the last of March or the 1st of April, 1909, the plaintiffs tendered 
 to the defendants $9,500 and four years interest thereon, which was 
 refused. 
 
 There was no other evidence upon the part of the plaintiffs of the 
 tender of any part of the purchase money, but they did offer evidence 
 that they were at all times ready,, able, and willing to pay the purchase 
 price, but they contended that the $500 first recited in said instrument 
 was a part of the purchase price, and that the balance due was $9,500, 
 instead of $10,000. They also offered evidence tending to prove that 
 after* the deed was written on April 1, 1905, material changes were 
 made therein, so that it did not conform to said instrument, and that 
 they declined to accept it on that ground. At the conclusion of the 
 whole evidence, his honor entered judgment of nonsuit, and the plain- 
 tiffs excepted and appealed. 
 
 Allen, J.''" In bilateral contracts there are reciprocal promises, so 
 that there is something to be done or forborne on both sides, while in 
 a unilateral contract there is a promise on one side only, the considera- 
 tion on the other side being executed. 9 Cyc. 244. An. option belongs 
 to the latter class. It is a contract to give another the right to buy, and 
 not a contract to sell, and it is because of the fact that. the other party 
 is not compelled to buy that it is spoken of as an offer. In Black v. 
 Maddox, 104 Ga. 157, 30 S. E. 723, approved in Trogden v. Williams, 
 144 N. C. 199, 56 S. E. 868, 10 L. R. A. (N. S.) 867, it is defined to be 
 "the obligation by which one binds himself to sell and leaves it discre- 
 tionary with the other party to buy, which is simply a contract by which 
 the owner of property agrees with another person that he shall have 
 the right to buy the property at a fixed price within a certain time." 
 
 If not based on a valuable consideration, the right to buy may be 
 withdrawn at any time before acceptance (Paddock v. Davenport, 107 
 N. C. 710, 12 S. E. 464), but, if there is a valuable consideration to sup- 
 port it, the right continues during the period fixed in the option. Cum- 
 mins v. Beavers, 103' Va. 230, 48 S. E. 891, 106 Am. St. Rep. 881, 1 
 Ann. Cas. 986. In this case the court said : "The distinction between 
 an option given without a consideration and an option given for a valu- 
 able consideration is that in the first case it is simply an offer to sell, and 
 can be withdrawn at any time before acceptance upon notice to the 
 vendee ; but in the second, where a consideration is paid for the option, 
 
 '^ Part of the statement of facts and the court's discussion of several cases 
 are omitted. 
 
Sec. 2) PEKFORMANCE ON TIME AS A CONDITION 615 
 
 it cannot be withdrawn by the vendor before the expiration of the time 
 specified in the option." 
 
 If no conditions are imposed upon the prospective purchaser, and it 
 is a simple proposition giving the right to buy, upon notice of acceptance, 
 it becomes a contract' of sale and is obligatory on both parties, and it is 
 then the duty of the seller to tender his deed and of the purchaser to 
 pay according to its terms. Hardy v. Ward, 150 N. C. 393, 64 S. E. 
 171. The maker has, however, the right to impose conditions which 
 must be performed precedent to the exerCise of the right to buy, and 
 among these is the payment of the agreed price. Weaver v. Burr, 31 
 W. Va. 736, 8 S. E. 743, 3 L. R. A. 94; Pollock v. Brookover, 60 W. 
 Va. 75, 53 S. E. 795, 6 L. R. A. (N. S.) 403; Trogden v. Williams, 144 
 N. C. 201, 56 S. E. 865, 10 L. R. A. (N. S.) 867. In the Trogden Case 
 the language in the contract was : "If they shall, within the time here- 
 inafter specified, elect to purchase said land, then and in that event 
 they shall pay one-half cash and the balance in twelve months, to be 
 secured by mortgage." And the court held that "payment of one half 
 the purchase money and securing the other half constitute the method 
 of electing to purchase," and quoted with approval the following ex- 
 cerpt from Weaver v. Burr, supra : "The period of 60 days from 7th 
 June, 1883, mentioned in the option, within which plaintifif had the 
 privilege of buying the land, * * * expired on the 6th day of 
 August, 1883. During the whole of that period and during the whole 
 of the 6th of August plaintiffs had the privilege of converting the offer 
 of John Burr into a valid and binding contract by an unconditional ac- 
 ceptance of and compliance with the terms thereof. They could not do 
 so by any other manner than by actual payment or tender of the whole 
 price of the land before the sixty days expired. Neither could they 
 withhold the payment, or tender of payment, until a proper deed was 
 executed or survey could be made and the excess number of acres as- 
 certained." Contracts of this character, being unilateral in their incep- 
 tion, are construed strictly in favor of the maker, because the other 
 party is not bound to performance, and is under no obligation to buy, 
 and it is generally held that time is of the essence of such a contract, 
 and that the conditions imposed must be performed in order to con- 
 vert the right to buy into a contract of sale. 
 
 The acceptance must be according to the terms of the contract, and 
 if these require the payment of the purchase money or any part there- 
 of, precedent to the exercise of the right to buy, the money must be 
 paid or tendered, and a mere notice of an intention to buy or that the 
 party will take the property does not change the relations of the parties. 
 Bateman v. Lumber Co., 154 N. C. 251, 70 S. E. 474, 34 h. R. A. (N. 
 S.) 615; Clark v. Lumber Co., 158 N. C. 139, 73 S. E. 793; Kelsey v. 
 Crowther, 162 U. S. 404, 16 Sup. Ct. 808, 40 L. Ed. 1017; Pom. Spec. 
 Per. § 387; Weaver v. Burr, supra; Trogden v. Williams, supra; Pol- 
 lock V, Brookover, 60 W. Va. 75, 53 S. E. 795, 6 L. R. A. (N. S.) 403 ; 
 
G16 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 Killough V. Lee, 2 Tex. Civ. App. 260, 21 S. W. 970; Stembridge v. 
 Stembridge, 87 Ky. 94, 7 S. W. 611 ; Schields v, Horbach, 30 Neb. 540, 
 46 N. W. 629; Hollmann v. Conlon, 143 Mo. 379, 45 S. W. 275. 
 * * * Applying these principles to the facts, we are of opinion 
 that the plaintiffs are not entitled to specific performance. 
 
 The paper writing does not purport to be a contract to convey, is uni- 
 lateral, £ind is what is designated as an option. * * * In the writ- 
 ing before us the makers, in consideration of $500 paid, agree upon the 
 payment of $10,000, of which $2,000 was to be paid the 1st day of 
 April, 1905, and the remainder in four annual installments at 6 per cent, 
 interest, to give, grant, sell, and convey by proper deed, etc., which if we 
 adopt a liberal and not a strict construction, can mean no more than that 
 the $500 was paid for the right to buy, and that this right could not be 
 exercised, nor were the makers under any obligation to convey until 
 payment or tender of the purchase money. 
 
 If this is the correct interpretation of the writing, the notice given by 
 the plaintiffs in March, 1905, that they would take the timber, did not 
 change the relations of the parties and convert the writing into a con- 
 tract to sell, because the writing imposed the further condition of pay- 
 ment of the purchase money. Nor can the conversation at the time 
 the deed was written have this effect, as no money was presented or 
 tendered, and it amounted to no more than an expression of readiness 
 to make the first payment of $2,000 upon delivery of the deed. It may 
 be conceded, as contended by the plaintiffs, for the purposes of this 
 appeal, and not otherwise,_that the conversation with one of the defend- 
 ants in March, the delay in the execution of the writing sued on and in 
 the execution of the deed work a waiver; of the right to demand pay- 
 ment on the 1st day of April, 1905, but it'appears from the record that 
 the paper writing was complete, on April 25, 1905, and was registered on 
 May 1st thereafter, and the plaintiffs were notified on April 27, 1905, 
 that the deed was ready for delivery. After notice of the execution of 
 the writing and of the deed, there was no excuse for further delay, and 
 it was then incumbent on the plaintiffs to pay or tender the sum of 
 $2,000 at least promptly. They did not do this, but on the contrary, 
 waited until May 30, 1905, before they offered to pay any amount, and 
 then only the sum of $1,500, which was not in compliance with the 
 writing upon which they sue in time or amount. The defendants re- 
 fused to accept, and declared the contract at an end, as they had the 
 right to do, and it could not be revived without their consent by subse- 
 quent offers to pay. In the view of the case we have adopted, the altera- 
 tion of the deed after it was written is not material, as the corre- 
 spondence shows that, while the defendants wished some modification of 
 the option, they did not refuse to execute a deed in accordance with its 
 terms until the plaintiffs had by delay lost their right to demand it. If, 
 under the writing, the plaintiffs had been required to do no more than 
 give notice ,of acceptance, they would have had the right to delay pay- 
 
Sec. 2) ' CONTRACTS OF SERVICE 617 
 
 ment until a deed was tendered conforming to the writing, but Hiey 
 were required to pay before they were entitled to demand a deed of 
 any kind, and had not placed themselves in position to criticize the one 
 offered. 
 
 We have discussed the case in the light rtiost favorable to the plain- 
 tiffs upon the assumption that they could have demanded a deed upon 
 the payment of $2,000, but we do not so decide, as the writing says up- 
 on the payment of $10,000, of which $2,000 was to be paid on the 1st 
 of April, 1905, and the remainder in four annual installments, ' the 
 makers agree to sell and convey. 
 
 For the reasons given, we are of opinion there was no error in en- 
 tering the judgment of nonsuit. 
 
 Affirmed.'^ 
 
 (e) Contracts of SbrvicE 
 
 POUSSARD V. SPIERS & POND. 
 (Queen's Bench Division of High Court of Justice, 1876. 1 Q. B. Dlv. 410.) 
 
 Declaration on an agreement by the defendants to employ the 
 plaintiff's wife to sing and play in an opera at the defendants' theatre. 
 Breach, that the defendants refused to allow the plaintiff's wife to 
 perform according to the .agreement. 
 
 Pleas: 1. That defendants did not agree as alleged. 2. That plain- 
 tiff's wife was not ready and willing to perform. 3. That plaintiff 
 rescinded the contract before breach. Issue joined. 
 
 At the trial before Field, J., at the Middlesex Michaelmas sittings, 
 1875, judgment was entered for the defendants, with leave to move to 
 enter judgment for the plaintiff for £83. 
 
 A notice of motion was given accordingly, and a cross order wasi 
 obtained by the defendants for a new trial, on the ground that the 
 verdict was against the weight of evidence, and that the damages 
 were excessive. 
 
 The facts proved and the course of the trial are fully given in the 
 judgment of the Court. 
 
 '^ It seems never to have been doubted that time is of the essence in accept- 
 ing an ordinary offer. The same rule is followed in regard to the exercise 
 of an irrevocable power created by an option contract. This is because the 
 executed consideration was given for a power with a fixed life period. That 
 power has been enjoyed just as agreed, and .strict enforcement of the time 
 limit causes no forfeiture whatever. So where a sale was to become absolute 
 In absence of a notice to the contrary by a fixed time, the power to terminate 
 the conditional duty ended on the exact day. Mackey Wall Plaster Co. v. 
 United States Gypsum Co. (D. C.) 244 Fed. 275 (1917) ; Berg Co. v. Thomas 
 & feon Co., 256 Pa. 584, 100 Atl. 951 (1917) ; International Filter Co. v. La 
 Grange Ice & Fuel Co., 22 Ga. App. 167, 95 S. E. 736 (1918). 
 
618 IMPLIED AND CONSTHUCTIVB CONDITIONS PKBCEDENT (Ch. 4 > 
 
 April 25. The judgment of the Court (Blackburn, Quain, and 
 Field, JJ.) was delivered by 
 
 Blackburn, J. This was an action for the dismissal of the plain- 
 tiff's wife from a theatrical engagement. On the trial before my 
 Brother Field it appeared that the defendants, Messrs. Spiers & Pond, 
 had taken the Criterion Theatre, and were about to bring out a French 
 opera, which was to be produced simultaneously in London and Paris. 
 Their manager, Mr. Kingston, by their authority, made a contract 
 with the plaintiff's wife, which was reduced to writing in the follow- 
 ing letter: 
 
 "Criterion Theatre, Oct. 16th, 1874. 
 "To Madame Poussard. 
 
 "On behalf of Messrs. Spiers & Pond I engage you to sing and play 
 at the Criterion Theatre on the following terms : 
 
 "You to play the part of Friquette in Lecocq's opera of Les Pres 
 Saint Gervais, commencing on or about the fourteenth of November 
 next, at a weekly salary of eleven pounds (ill), and to continue on at 
 that sum for a period of three months, providing the opera shall run 
 for that period. Then, at the expiration of the said three months, I 
 shall be at liberty to re-engage you at my option, on terms then to 
 be arranged, and not to exceed fourteen pounds per week for an- 
 other period of three months. Dresses and tights requisite for the 
 part to be provided by the nianagement, and the engagement, to be 
 subject to the ordinary rules and regulations of the theatre. 
 
 "Ratified : E, P. Kingston, Manager. 
 
 "Spiers & .Pond. 
 "Madame Poussard, 46, Gunter Grove, Chelsea." 
 
 The first performance of the piece was announced for Saturday, 
 the 28th of November. No objection was raised on either side as 
 to this delay, and Madame Poussard attended rehearsals, and such 
 attendance, though not expressed in the written engagement, was an 
 implied part of it. Owing to delays on the part of the composer, the 
 music of the latter part of the piece was not in the hands of the de- 
 fendants till a few days before that announced for the production 
 of the piece, and the latter and final rehearsals did not take place till 
 the week on the Saturday of which the performance was announced. 
 Madame Poussard was unfortunately taken ill, and though she strug- 
 gled to attend the rehearsals, she was obliged on Monday, the 23d of 
 November, to leave the rehearsal, go home and go to bed, and call in 
 medical attendance. In the course of the next day or two an inter- 
 view took place between the plaintiff and Mr. Leonard (Madame Pous- 
 sard's medical attendant) and Mrs. Liston, who was the defendants' 
 stage manager, in reference to Madame Poussard's ability to attend 
 and undertaice her part, and there was a conflict of testimony as to what 
 took place. According to the defendants' version Mrs. Liston requested 
 to know as soon as possible what was the prospect of Madame Pous- 
 
Sec. 2) CONTRACTS OF SERVICE 619 
 
 sard's recovery, as it would be very difficult on such short notice to 
 obtain a substitute; and that in the result the plaintiff wrote stating 
 that his wife's health was such that she could not play on the Sat- 
 urday night, and that Mrs. Liston had better, therefore, engage a young 
 lady to play the part ; and this, if believed to be accurate, amounted 
 to a rescission of the contract. According to the evidence of the 
 plaintiff and the doctor, Mrs. Liston told them that Madame Pous- 
 sard was to take care of herself and not come out till quite well, as 
 she, Mrs. Liston had procured, or would procure, a temporary sub- 
 stitute; and Madame Poussard could resume her place as soon as 
 she was well. This, it was contended by the plaintiff, amounted to a 
 waiver by the defendants of a breach of the condition precedent if 
 there was one. 
 
 The jury found that the plaintiff did not rescind the contract, and 
 that Mrs. Liston, if she did waive the condition precedent (as to 
 which they were not agreed) had no authority from the defendants 
 so to do. 
 
 These findings, if they stand, dispose of those two questions. 
 
 There was no substantial conflict as to what was in fact done by 
 Mrs. Liston. Upon learning, on the Wednesday (the 25th of Novem- 
 ber) the possibility that Madame Poussard might be prevented by ill- 
 ness from fulfilling her engagement, she sent to a theatrical agent to 
 inquire what artistes of position were disengaged, and learning that 
 Miss Lewis had no engagement till the 2Sth of December, she made 
 a provisional arrangement with her, by which Miss Lewis undertook 
 to study the part and be ready on Saturday to take the part, in case 
 Madame Poussard was not then recovered so far as to be ready to 
 perform. If it should turn out that this labour was thrown away. Miss 
 Lewis was to have a douceur for her trouble. If Miss Lewis was 
 called on to perform, she was to be engaged at il5 a week up to the 25th 
 of December, if the piece ran so long. Madame Poussard continued 
 in bed and ill, and unable to attend either the subsequent rehearsals 
 or the first night of the performance on the Saturday, and Miss Lewis' 
 engagement became absolute, and she performed the part on Saturday, 
 Monday, Tuesday, Wednesday, and up to the close of her engagement, 
 the 25th of December. The piece proved a success, and in fact ran for 
 more than three months. 
 
 On Thursday, the 4th of December, Madame Poussard, having re- 
 covered, offered to take her place, but was refused, and for this re- 
 fusal the action was brought. ' 
 
 On the 2d of January Madame Poussard left England. 
 
 My Brother Field, at the trial, expressed his opinion that the fail- 
 ure of Madame Poussard to be ready to perform, under the circum- 
 stances, went so much to the root of the consideration as to discharge 
 the defendants, and that he should therefore enter judgment for the 
 defendants; but he asked the jury five questions. 
 
620 IMPLIED AND CONSTBUCTIVB CONDITIONS PKECEDBNT (Ch. 4 
 
 The first three related to the supposed rescission and waiver. The 
 other questions were in writing and were: 4. Whether the non-at- 
 tendance on the night of the opening was of such material consequence 
 to the defendants as to entitle them to rescind the contract? To which 
 the jury said, "No." And, 5, was it of such consequence as to ren- 
 der it reasonable for the defendants to employ another artiste, and 
 whether the engagement of Miss Lewis, as made, was reasonable; 
 to which the jury said "Yes." Lastly, he left the question of dam- 
 ages, which the jury assessed at £83. 
 
 On these answers he reserved leave to the plaintiff to move to enter 
 judgment for £83. 
 
 A cross rule was obtained on the ground that the verdict was against 
 evidence and that the damages were excessive. 
 
 We think that, from the nature of the engagement to take a lead- 
 ing, and, indeed, the principal female part (for the prima donna sang 
 her part in male costume as the Prince de Conti) in a new opera 
 which (as apftears from the terms of the engagement) it was known 
 might run for a longer or shorter time, and so be a profitable or los- 
 ing concern to the defendants, we can, without the aid of the jury, 
 see that it must have been of great importance to the defendants 
 that the piece should start well, and consequently that the failure of 
 the plaintiff's wife to be able to perform on the opening and early 
 performances was a very serious detriment to them. 
 
 This inability haying been occasioned by sickness was not any 
 breach of contract by the plaintiff, and no action can lie against him 
 for the failure thus occasioned. But the damage to the defendants 
 and the consequent failure of consideration is just as great as if it 
 had been occasioned by the plaintiff's fault, instead of by his wife's 
 misfortune. The analogy is complete between this case and that of 
 a charter party in the ordinary terms, where the ship is to proceed 
 in ballast (the act of God, &c., excepted) to a port and there load 
 a cargo. If the delay is occasioned by excepted perils, the shipowner 
 is excused. But if it is so great as to go to the root of the matter, 
 it frees the charterer from his obligation to furnish a cargo. See per 
 Bramwell, B., delivering the judgment of the majority of the Court of 
 Exchequer Chamber in Jackson v. Union Marine Insurance Co., Law 
 Rep. 10 C. P. at page 141. 
 
 And we think that the question, whether the failure of a skilled 
 and capable artiste to perform in a new piece through serious illness 
 is so important as to go to the root of the consideration, must to 
 some extent depend on the evidence; and is a mixed question of law 
 and fact. Theoretically, the facts should be left to and found sep- 
 arately by the jury, it being for the judge or the Court to say whether 
 they, being so found, shew a breach of a condition precedent or riot. 
 But this course is often (if not generally)- impracticable ; and if we 
 can see that the proper facts have been found, we should act on these 
 without regard to the form of the questions. 
 
Sec. 2) CONTRACTS OF SERVICE • 621 
 
 Now, in the present case, we must consider what were the courses 
 open to the defendants under the circumstances. They might, it was 
 said on the argument before us (though not on the trial), have post- 
 poned the bringing out of the piece till the recovery of Madame Pous- 
 sard, and if her illness had been a temporary hoarseness incapacitat- 
 ing her from singing on Saturday, but sure to be removed by the Mon- 
 day, that might have been a proper course to pursue. But the illness 
 here was a serious one, of uncertain duration, and if the plaintiff 
 had at the trial suggested that this was the proper course, it would, 
 no doubt, have been shewn that it would have been a ruinous course ; 
 and that it would have been much better to have abandoned the piece 
 altogether than to have postponed it from day to day for an un- 
 certain time during which the theatre would have been a heavy loss. 
 
 The remaining alternatives were to employ a temporary substitute 
 until such time as the plaintiff's wife should recover; and if a tempo- 
 rary substitute capable of performing the part adequately could 
 have been obtained upon such a precarious engagement on any rea- 
 sonable terms, that would have been a right course to pursue; but 
 if no substitute capable of performing the part adequately could be 
 obtained, except on the terms that she should be permanently engaged 
 at higher pay than the plaintiff's wife, in our opinion it follows, as 
 a matter of law, that the failure on the plaintiff's part went to the root 
 of the matter and discharged the defendants. 
 
 We think, therefore, that the fifth question put to the jury, and 
 answered by them in favour of the defendants, does find all the facts 
 necessary to enable us to decide as a matter of law that the defendants 
 are discharged. 
 
 The fourth question is, no doubt, found by the jury for the plain- 
 tiff ; but we think in finding it they must have made a mistake in law 
 as to what was a sufficient failure of consideration to set the defendants 
 at liberty, which was not a question for them. 
 
 This view taken by us renders it unnecessary to decide anything 
 on the cross rule for a new trial. 
 
 The motion must be refused wjth costs. 
 
 Motion refused with costs. 
 
 BETTINI V. GYE. 
 (Queen's Bench Division of High Court of Justice, 1876. 1 Q. B. Div. 183.) 
 
 Third count, that the defendant was and is the director of the Royr- 
 al Italian Opera in London, and the plaintiff was and is a draraatic ar- 
 tist and professional singer, and thereupon it was agreed by and be- 
 tween the plaintiff and the defendant in parts beyond the seas, to wit, 
 at Milan, in Italy, by an agreement in writing in the French language, 
 of which the translation is as follp^ws: 
 
~,1 
 
 622 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 "Royal Italian Opera, Covent Garden, London. 
 "Year 1875. 
 
 "The undersigned, Mr. Frederick Gye, gentleman, and director of 
 the Ko3'al Italian Opera in London, of the one part, and Mr. Bettini, 
 dramatic artist, on the other part, have agreed as follows : 
 
 "1. Mr. Bettini undertakes to fill the part of primo tenor assoluto 
 in the theatres, halls, and drawing-rooms, both public and private, 
 in Great Britain and in Ireland during the period of his engagement 
 with Mr. Gye. 
 
 "2. This engagement shall begin on the 30th of March, 1875, and 
 shall terminate on the 13th of July, 1875. 
 
 "3. The salary of Mr. Bettini shall be ilSO per month', to be paid 
 monthly. 
 
 "4. Mr. Bettini shall sing in concerts as well as in operas, but he 
 shall not sign anywhere out of the theatre in the United Kingdom of 
 Great Britain and Ireland from the 1st of January to the 31st of 
 December, 1875, without the written permission of Mr. Gye, except 
 at a distance of more than fifty miles from London, and out Of the 
 season of the theatre. 
 
 "5. Mr. Gye shall furnish the costumes to Mr. Bettini for his char- 
 acters according to the ordinary usage of theatres. 
 
 "6. Mr. Bettini will conform to the ordinary rules of the theatre in 
 case of sickness, fire, rehearsals, etc. 
 
 "7. Mr. Bettini agrees to be in London without fail at least six days 
 before the commencement of his engagement, for the purpose of re- 
 hearsals. 
 
 "8. In case Mr. Gye shall require the services of Mr. Bettini at a 
 distance of more than ten miles from- London, he shall pay his travel- 
 ling expenses. 
 
 "9. Mr. Bettini shall not be obliged to sing more than four times a 
 week in opera. Mr. Bettini, in order to assist the direction of Mr. 
 Gye, will sing, upon the request of Mr. Gye, in the same characters 
 in which he has already sung, and in other characters of equal posi- 
 tion. In case of the sickness of other artists, Mr. Bettini agrees to 
 replace them in their characters of first tenor assoluto. 
 
 "10. Mr. Gye shall have the right to prolong the period Hmited 
 above upon the same conditions, provided that the period does not go 
 beyond the end of the month of August. F. Gye. 
 
 "Milan, 14 Dec. 1874." 
 
 That the plaintiff did not sing anywhere out of the said theatre 
 in the United Kingdom of Great Britain and Ireland, from January 
 1st, 1875, to the date of the commencement of this action, without 
 the written permission of the defendant, except at a distance of more 
 than fifty miles from London, and out of the season of the said theatre. 
 That -the plaintiff was prevented by temporary illness from being in 
 London before March 28th, 1875, but he did arrive in London on 
 
Sec. 2) CONTRACTS OP SERVICE 623 
 
 that day; and, save as aforesaid, the plaintiff has always performed 
 his said agreement, and was and is ready and willing to perform his 
 part of the said agreement, of all which the defendant had notice, 
 and all things were done and happened and all conditions were fulfill- 
 ed and all times elapsed necessary to entitle the plaintiff to a perform- 
 ance by the defendant of the said agreement and to maintain this 
 action. Yet the defendant did not nor would receive the plaintiff into 
 his said service but wholl)' refused so to do, and wrongfully exoner- 
 ated and discharged the plaintiff from his said agreement, and from 
 the performance of the said agreement on the plaintiff's part, and 
 wrongfully put an end to and determined the said agreement, where- 
 by the plaintiff was damnified. 
 
 The defendant pleaded, ninthly, to the third count, that the plain- 
 tiff was not in London six days before the commencement of the said 
 engagement for the purpose of rehearsals, nor had the defendant notice 
 before the said six days of the plaintiff's inability to be in IvOndon, 
 or that he would not be in London six days before the commencement 
 of his said engagement for the- purpose of rehearsals, nor was the 
 plaintiff leady and willing to attend such rehearsals, although it was 
 necessary for him to do so, wherefore the defendant did not nor 
 would receive the plaintiff into his service in the capacity and on the 
 terms aforesaid, which is the breach complained of. < 
 
 Demurrer to the ninth plea, and joinder. 
 
 The judgment of the Court (Blackburn, Quain, and Archibald, 
 JJ.) was delivered by 
 
 Blackburn, J. In this case the parties have entered into an agree- 
 ment in writing, whicli is set out on the, record. 
 
 The Court must ascertain the intention of the parties, as is said by 
 . Parke, B., in delivering the judgment of the Court in Graves v.Legg 
 [9 Ex. at page 716] "to be collected from the instrument and the cir- 
 cumstances legally admissible in evidence with reference to which it 
 is to be construed." He adds : "One particular rule well acknowledg- 
 ed is, that where a covenant or agreement goes to part of the consid- 
 eration on both sides, and may be compensated in damages, it is an 
 independent covenant or contract." There was no averment of any 
 special circumstances existing in this case, with reference to which, the 
 agreem.ent was made, but the Court must look at the general, nature- 
 of such an engagement. By the seventh paragraph of the agreement, 
 "Mr. Bettini agrees to be in London without fail at least six days be- 
 fore the commencement of his engagement for the purpose of rehears- 
 als." The engagement was to begin on March 30th, 1875. It is ad- 
 mitted on the record that the plaintiff did not arrive in London till 
 March ^Sth, which is less than six days before the 30th, and there- 
 fore it is clear that he has not fulfilled this part of the contract. 
 
 The question raised by the demurrer is, not whether the plaintiff 
 has any excuse for failing to fulfill this part of his contract, which 
 may prevent his being' liable in damages for not doing so, but whether 
 
G24 IMPLIED AND CONSTRICTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 his failure to do so justified the defendant in refusing to proceed with 
 the engagement, and fulfil his, the defendant's, part. And the answer 
 to that question depends on whether this part of the contract is a con- 
 dition precedent to the defendant's liability, or only an independent 
 agreement, a breach of which will not justify a repudiation of the con- 
 tract, but will only be a cause of action for a compensation in dam- 
 ages. 
 
 This is a question which has very often been raised, and the nu- 
 merous cases on the subject are collected, in the first volume of Sir 
 E. V. Williams's Notes to Saunders, p. 554, in the notes to Pordage v. 
 Cole, and in the second volume, p. 742, notes to Peeters v. Opie. 
 
 We think the answer to this question depends on the true construc- 
 tion of the contract taken as a whole. 
 
 Parties may think some matter, apparently of very little importance, 
 essential; and if they sufficiently express an intention to make the 
 literal fulfilment of such a thing a condition precedent, it will be 
 one; or they may think that the performance of some matter, appar- 
 ently of essential importance and prima facie a condition precedent, 
 is not really vital, and may be compensated for in damages, and if they 
 sufficiently expressed such an intention, it will not be a condition pre- 
 cedent. 
 
 In this case, if to the seventh paragraph of the agreement there had 
 been added words to this effect, "And if Mr. Bettini is not there at 
 the stipulated time Mr. Gye may refuse to proceed further with the 
 agreement ;" or if, on the other hand, it had been said, "And if not 
 there, Mr. Gye may postpone the commencement of Mr. Bettini's 
 engagement for as many days as Mr. Bettini makes default, and he 
 shall forfeit twice his salary for that time," there could have been no 
 question raised in the case. But there is no such declaration of the 
 intention of the parties either way. And in the absence of such an 
 express declaration, we think that we are to look to the whole con- 
 tract, and, applying the rule stated by Parke, B., to be acknowledged,'* 
 see whether the particular stipulation goes to the root of the matter, 
 so that a fjiilure to perform it would render the performance of the 
 rest of the contract by the plaintiff a thing different in substance from 
 what the defendant has stipulated for; or whether it nierely partially 
 affects it and may be compensated for in damages. Accordingly, as it 
 is one or the other, we think it must be taken to be or not to be in- 
 tended to be a condition precedent. 
 
 If the plaintiff's engagement had been only to sing in operas at the 
 theatre, it might very well be that previous attendance at rehearsals 
 with the actors in company with whom he was to perform was essen- 
 tial. And if the engagement had been only for a few performances, 
 or for a short time, it would afford a strong argument that attendance 
 for the purpose of rehearsals during the six days immediately before 
 
 T8 In Graves v. Legg, 9 Ex. at p. 716; 23 L. J. (Ex.) 228. 
 
Sec. 2) CONTEAOTS OF SERVICE 625 
 
 the commencement of the engagement was a vital part of the agree- 
 ment. But we find, on looking to the agreement, that the plaintiff 
 was to sing in theatres, halls, and drawing-rooms, both public and pri- 
 vate, from March 30th to July 13th, 1875, and that he was to ^ing 
 in concerts as well as in operas, and was not to sing anywhere out of 
 the theatre in Great Britain or Ireland from January 1st to December 
 31st, 1875, without the written permission of the defendant, except 
 at a distance of more than fifty miles from London. 
 
 The plaintiff, therefore, has, in consequence of this agreement, been 
 deprived of the power of earning anything in London from January 
 1st to March 30th; and though the defendaijit has, perhaps, not re- 
 ceived any benefit from this, so as to preclude him from any longer 
 treating as a condition precedent what had originally been one, we 
 think this at least affords a strong argument for saying that subse- 
 quent stipulations are not intended to be conditions precedent, unless 
 the nature of the thing strongly shows they must be so. 
 
 And as far as we can see, the failure to attend at rehearsals during 
 the six days immediately before March 30th could only affect the the- 
 atrical performances and, perhaps, the singing in duets or concerted 
 pieces during the first week or fortnight of this engagement, which is 
 to sing in theatres, halls, and drawing-rooms, and concerts for fifteen 
 weeks. 
 
 We think, therefore, that it does not go to the root of the matter 
 so as to require us to consider it a condition precedent. 
 
 The defendant must therefore, we think, seek redress by a cross- 
 action for damages. 
 
 Judgment for the plaintiff. 
 
 FARMER V. FIRST TRUST CO. 
 In re MILWAUKEE MOTOR CO. 
 
 (Circuit Court of Appeals of the United States, 1917. 246 Fed. 671, 158 O. C. 
 A. 627, L. B. A. 19180, 1027.) 
 
 In the matter of the Milwaukee Motor Company, bankrupt; First 
 Trust Company, trustee. Appeal by A. J. Farmer from an order dis- 
 allowing his claim. Affirmed. 
 
 Appellant Farmer, a mechanical engineer, was employed as super- 
 intendent of the bankrupt's gas engine shops at Milwaukee. After 
 serving about two months in such capacity, a contract for a year's 
 service, beginning August 1, 1912, was entered into, under which 
 Farmer was to. superintend and manage the shops, devoting his entire 
 time thereto, and to receive for such service a .salary of $6,500 and a 
 bonus of $3 per engine if, with the equipment of the factory, and such 
 further equipment as had theretofore been specified by Farmer, 3,000 
 engines were produced within the year at prescribed factory costs, to 
 fill contracts therefor which were extant. Provision was made for 
 
 (JOEBIN (JONT. — 40 
 
626 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 renewal of the contract for another year if Farmer "has made good his 
 guaranty to make the said 3,000 engines now sold within this contract 
 year, and within the above schedule cost of manufacture." 
 
 Under date of July 26th, the bankrupt had entered into a contract 
 with the Imperial Automobile Company of Jackson, Mich., to supply it 
 2,200 motors, with option for 1,000 more, during the entire year; the 
 contracted deliveries for 1912 being August 100, September 130, 
 October 260, November 260, and December 300. 
 
 The work of installing the new equipment was being carried on, 
 and the manufacture of the engines proceeded, but in the months 
 indicated only 190 engines were completed for delivery, and some, if 
 not all of these, proved unsatisfactory. Demands for overdue deliv- 
 eries were being made, as well a's complaints respecting engines deliv- 
 ered. In response to the complaints the bankrupt's vice president on 
 December 18th went to Jackson, taking Farmer with him. The next 
 day Farmer started back home by way of Chicago. The vice president 
 urged him to be back to the shops as soon as possible, and Farmer said 
 he would reach Milwaukee the same day, as he intended stoppings at 
 Chicago but a short time to buy his wife a Christmas present. Upon 
 reaching Chicago he did not return to Milwaukee, but remained at 
 Chicago until the 22d, indulging himself in diversion strictly personal. 
 Coming to Milwaukee on the 22d, he did not go to- the shop because 
 of a severe cold he had contracted. On the 24th he was dismissed 
 from his employment. Within six months thereafter the company 
 became bankrupt. Farmer filed his claim for $13,062.45 for damage 
 accruing to him by reason of his alleged unlawful dismissal.''' 
 
 AlschulBr, Circuit Judge (after stating the facts as above). It is 
 maintained for appellant that one serving in a supervisory capacity 
 is not so strictly accountable to the employer for his time as is a clerk 
 or a workman, and that Farmer's absence of two or three days with- 
 out permission was not such a breach of the contract as warranted 
 its termination. The legal proposition, as generally stated, is sus- 
 tained by the authorities cited from Wisconsin, the state where this 
 contract was made, as well as elsewhere. Moody v. Streissguth Cloth- 
 ing Co., 96 Wis. 202, 71 N. W. 99; Scliumaker v. Heinemann et al., 
 99 Wis. 2S1, 74 N. W. 785; Loos v. Walter Brewing Co., 145 Wis. 1, 
 129 N. W. 645, 140 Am. St. Rep. 1052 ; Green v. Soraers, 163 Wis. 
 96, 157 N. W. 529 ; Beach on Miodern Law of Contracts, § 584. 
 
 But the applicability of such rule must depend on the facts of par- 
 ticular cases. Conditions may be readily imagined where in a well- 
 organized, smoothly running, and successful business a day's or even 
 a month's absence of a general superintendent, who has the business 
 well in hand, might be wholly consistent with its continued uneventful 
 and successful operation. Upon the other hand, the business may be 
 in condition so critical that a single hour's willful absence of such an 
 
 i» The statement of facts is condensed. 
 
Sec. 2) CONTRACTS OF SERVICE 627 
 
 oiEcer at such a time might well be regarded as rank disloyalty and 
 gross insubordination. Nearly five months of the new contract period 
 had passed. Instead of deliveries of 1,050 engines required during 
 that time under a single contract, to say nothing of other outstanding 
 contracts, but 190 all told had in fact been delivered, and these more 
 or less defective. Purchasers were clamoring for deliveries and com- 
 plaining of defects in those delivered; materials were delayed; there 
 was more or less trouble in the shop ; and things generally seemed to 
 be going awry. Added to this, the new equipment was in process of 
 installation; old machines were being moved and changed; and the 
 shop was undergoing radical rearrangement and reconstruction. The 
 responsible head was Fanner. He had various foremen under him, 
 but he was the only mechanical engineer connected with the plant, and 
 while in authority it was upon his designing, planning, and direction 
 that success or failure depended. This high-priced man faced obsta- 
 cles, to surmount which would manifestly require his fullest capacity 
 and undivided attention. Surely this was not a situation wherein the , 
 man at the helm might needlessly and with impunity abandon his post 
 that he may tread "the primrose path of dalliance." 
 
 It is urged that the evidence shows no harm to the business result- 
 ing from these days of -absence of its mechanical head. The sentry 
 sleeping at his post, is not less derelict in duty if, haply, disaster does 
 not follow ; nor is the responsible employe's disloyalty or insubordina- 
 tion measured by the extent of the resultant harm to the employer, nor 
 minimized if none happens to follow. 
 
 It is insisted that even if, while at Chicago, appellant did |;ransgress 
 the canons of propriety and right living, this of itself would not war- 
 rant his dismissal. The authorities support the proposition that if 
 the ■ transgression does not injure the employer, nor unfit the trans- 
 gressor for the employment, termination of a contract of employment 
 for such cause alone would not be justified. Wood, Master & Servant, 
 § 110; Child V. Boyd, etc., Co., 175 Mass. 493, 56 N. E. 608; Brown- 
 ell V. Ehrich, 43 App. Div. 369, 60 N. Y. Supp. 112. But the dismissal 
 here is not justified on the ground of the employe's personal trans- 
 gression at Chicago. The fact of the 'transgression affords evidence 
 that the absence ffom duty was not necessitated by any such causes 
 as might excuse' it, and emphasizes the conclusion that' it was willful 
 and deliberate, and under conditions which gave to the conduct strong 
 color of disloyalty and insubordination. 
 
 ■ Nor is it material that at the time of the dismissal the employer 
 did not know of his conduct at Chicago, and did not assign it as a 
 cause of dismissal. Even if the cause assigned for dismissal was not 
 in Itself sufficient, if it appears that sufficient cause therefor did in 
 fact exist, the dismissal was justified. Wood, Master & Servant, § 121 ; 
 Labatt's Master & Servant, § 189; Carpenter Steel Co. v. Norcross, 
 204 Fed. 537, 123 C. C. A. 63, Ann. Cas. 1916A, 1035 ; Thomas v. 
 Beaver Dam Mfg. Co., 157 Wis. 427, 147 N. W. 364, Ann. Cas. 
 
G28 IMPLIED AND CONSTKUCTIVB CONDITIONS PBECEDENT (Ch. 4 
 
 1916A, 1020; Loos v. Walter Brewing Co., 145 Wis. 1, 129 N. W. 
 645, 140 Am. St. Rep. 1052; Von Heyne v. Tompkins, 89 Minn. 77, 
 93 N. W. 901, 5 L. R. A. (N. S.) 524. But the employer did then 
 know the desperate condition of things at home; did know that ap- 
 pellant's place was there, and his presence there much needed; did 
 know appellant had been asked at Jackson to return at once to the shop, 
 and had stated he would do so after a short stay at- Chicago for buying 
 a present; and did know that for several days he did not put in ap- 
 pearance at his place of duty. Without any excuse appearing for the 
 absence, such as illness or other unavoidable cause might afford, the 
 employer was warranted in attributing it to a willful disregard of the 
 master's interests, and to insubordination, which, in our judgment, 
 upon this record justified his dismissal. ' 
 
 The order of the District Court is therefore affirmedi" 
 
 (f) CfiRTiificATE OP Architect or Engineer 
 
 SECOND NAT. BANK OF CINCINNATI, OHIO, v. PAN- 
 AMERICAN BRIDGE CO. 
 
 (Circuit CSourt of Appeals of the United States, 1910. 183 Fed. 391, 105 
 
 C. 0. A. 611.) 
 
 In Error to the Circuit Court of the United States for the South- 
 ern District of Ohio. 
 
 Action at law by the Pan-American Bridge. Company against the 
 Second National Bank of Cincinnati, Ohio. Judgment for plaintiff, and 
 defendant brings error. Reversed. 
 
 KnappEN, Circuit Judge.^^ The defendant in error (plaintiff below, 
 and hereafter called the plaintiff) recovered verdict and judgment 
 against plaintiff in error (hereafter called the defendant) for $2,723.49, 
 being the balance of the contract price for certain structural steel 
 work furnished by plaintiff, under written contract with defendant, 
 for the construction of the latter's bank building, together with the 
 value of certain extras furnished. The questions presented on this 
 review lie within a comparatively narrow compass. The facts material 
 to their understanding are these : 
 
 The contract provides that plaintiff shall furnish and erect the 
 work "agreeably to the drawings and plans prepared by" the archi- 
 tects for the owner, and that the work shall be performed "under the 
 direction, and to the satisfaction of" the architects or the authorized 
 
 80 See, also, .Crabtree v. Bay State Felt Co., 227 Mass. 68, 116 N. B. 585 ( 191T) , 
 superintendent refused to appear before board of directors ; held a question 
 for the jury; Casavant v. Sherman, 213 Mass. 23, 99 N. E. 475 (1912). 
 
 " I Part of the opinion is omitted. 
 
Sec. 2) CEBTIFIOATE OF ABOHITEOT 629 
 
 representative of the owner; also that payments under the contract 
 should be made "upon a certificate of the architect or other author- 
 ized representative of the owner," IS per cent, being retained from 
 the amount of each certificate and to be paid within 30 days after the 
 final completion of the work "arid the acceptance of the same by the 
 architects of the owner, or its duly authorized agent." Payments 
 were made from time to time by the defendcint as the work pro- 
 gressed, aggregating full payment of the contract price, except the 
 sum of $2,062.89. Plaintiff furnished extras amounting to $660.60. 
 It is for the sum of these two items that recovery was permitted. 
 There is no dispute over the extras. The only dispute over the merits 
 of the other item arises upon the claim of defendant that it should 
 be allowed $2,370.84, as tiie expense of making certain changes in 
 the work claimed to have been made necessary by plaintiff's failure 
 to comply with the specifications in one respect only, which is this: 
 The specifications provide that "the connection of beams and columns 
 will be standard.^' They also provide that the contractor shall fur- 
 nish to the architect, for his approval, triplicate copies of detail draw- 
 ings, and that the work shall be executed "in strict accordance with such 
 approved drawings," there being the further provision that "the archi- 
 tect, in approving these drawings, approves them in a general man- 
 ner as being in or out of conformance with the general requirements 
 of his drawings and specifications and does not relieve the contractor 
 of responsibility for the correctness of the work shown by them." 
 
 The contractor made detail drawings of the connections of beams 
 and columns, plainly showing 8 holes for each connectipn; that is to 
 say, in splice-plates, angle irons, columns, and beams. These draw- 
 ings were approved in writing by the architect. Construction in ac- 
 cordance therewith proceeded to at least the sixth story, without ob- 
 jection by the owner or the architect to the manner of these connec- 
 tions. Objection was then made that good workmanship and stand- 
 ard connection required 10 rivets instead of 8 for each connection. 
 The record indicates that this objection was first made by the public 
 building inspector. There is testimony- tending to show that the ar- 
 chitect, after construction had progressed to at least the height be- 
 fore stated, insisted that new 10-rivet connections be furnished in 
 place of the 8-rivet connections. Upon plaintiff's refusal or failure 
 to make the changes, they.were made by defendant at a cost of $2,- 
 370.84. The architect was satisfied with and accepted the material 
 and workmanship furnished by plaintiff with the single exception of 
 the connections in question. He refused to finally accept plaintifFs 
 work as a performance of the contract and to give a certificate of 
 such performance, basing his refusal upon the failure of plaintiff to 
 make the proper connections or to allow defendant for the cost of 
 the changes made therein. The plaintiff's work has not been accepted 
 by defendant, or by any one on its behalf, as a complete perfoi-mance 
 
630 IMPLIED AND CONSTRUCTIVE CONDITIONS PEBCEDENT (Ch. 4 
 
 of the contract^ the defendant, however, being in the occupancy and 
 use of the building. By its plea it offered to confess judgment for 
 $352.69, as the difference between the plaintiff's,claim and the amount 
 paid by defendant for making the new connections. 
 
 Upon the trial there was a conflict of testimony as to whether 
 8-rivet connections were standard or whether 10-rivets were required. 
 The defendant, both by objection to testimony and by motion for a 
 directed verdict at the close of the testimony, insisted that plaintiff 
 was precluded from recovery by the architect's refusal to accept per- 
 formance of the contract and to give his certificate thereof, and that 
 plaintiff could have relief against such refusal only in a court of 
 equity. The court instructed the jury that if plaintiff's work and ma- 
 terial conformed to the contract recovery could be had, notwithstand- 
 ing the lack of acceptance or certificate by the architect, provided the 
 jury should find that such certificate was withheld "unreasonably and 
 unfairly" or (as expressed at another time) "capriciously or arbitra- 
 rily." An instruction requested by defendant at the close of the 
 general charge that "it is not sufficient to show that the architect is 
 unreasonable and unfair," was refused. No exception was taken to 
 the charge of the court as given, exception being, however, reserved 
 to the refusal to give the request just referred to as well as to the re- 
 fusal to direct verdict for defendant. 
 
 In our opinion the exception to the refusal of defendant's request 
 just mentioned: sufficiently raises for review the correctness of the 
 charge in the respect mentioned. Indeed, no question, of such suffi- 
 ciency is raised in plaintiff's brief. 
 
 We cannot accede to the proposition that resort to equity is neces- 
 sary in order to avoid the effect of failure to obtain the architect's 
 certificate. The contention mo,st strongly urged seems to be that the 
 plaintiff must, as condition precedent to recovery on the contract, pro- 
 cure the setting aside of the contract provisions requiring such, cer- 
 tificate, although the suggestion is also made that the architect's ac- 
 tion needs reforming. Neither of those contentions is, in our opin- 
 ion, maintainable. The plaintiff does not attack the validity of the 
 contract provision requiring the architect's certificate as a condition 
 precedent to recovery. Nor is there any certificate of the architect 
 standing in the way and requiring reformation. The plaintiff's com- 
 plaint in this respect is not that the contract is wrong, nor that any 
 certificate of the architect is wrong. Its grievance is that the archi- 
 tect has improperly refused, as alleged, to accept the work and to 
 certify accordingly. * * * 
 
 The right of a party to a building contract to show in an action 
 at law thereon that the certificate required by the contract as a condi- 
 tion precedent to action was fraudulently withheld has been at least 
 impliedly recognized in numerous cases, several of which are cited 
 in another branch of this opinion, and has never, so far as we have 
 
Sec. 2) CERTIFICATE OP ARCHITECT 631 
 
 seen, been denied. But in our opinion the trial judge erred in holding 
 that the architect's certificate could be dispensed with if the jury were 
 satisfied that it was "unreasonably and unfairly" withheld. It is true 
 that this instruction finds apparent support in several decisions of 
 state courts cited in plaintifii's brief. But the rule is well settled in 
 the federal courts that under contract provisions such, as those exist- 
 ing here the certificate of acceptance is a condition precedent to recov- 
 ery upon the contract in the absence of fraud or of mistake so gross 
 as to imply bad faith ; in other words, that the withholding of the cer- 
 tificate must have been in bad faith. 
 
 Thus, in Kihlberg v. United States, 97 U. S. 402, 24 L. Ed. 1106, 
 it was said: "It is sufficient that the parties expressly agreed that 
 distances should be ascertained and fixed by the chief quartermaster, 
 and in the absence of fraud or such gross mistake as would neces- 
 sarily imply bad faith, or a failure to exercise an honest judgment,, his 
 action in the premises is conclusive upon the appellant as well as upon 
 the government." 
 
 In Sweeney v. United States, 109 U. S. 618, 620, 3 Sup. Ct. 344. 
 27 L. Ed. 1053, it was held that, as there was "neither fraud, nor 
 such gross mistake as would necessarily imply bad faith, nor any fail- 
 ure to exercise an honest judgment on the part of the officer in mak- 
 ing his inspections," the certificate was a condition precedent to pay- 
 ment. In Martinsburg & Potomac R. R. Co. v. March, 114 U. S. 
 549, 551, 553, 5. Sup. Ct. 1035, 1037, 29 E. Ed. 255, a charge was 
 requested that the engineer's final estimate was conclusive unless it 
 appeared that he was guilty of "fraud or intentional misconduct." 
 A modification by adding the words "or gross mistake" was held 
 "well calculated to mislead the jury, for they were not informed that 
 the mistake must have been so gross, or of such a nature, as neces- 
 sarily implied bad faith upon the part of the engineer." In Chicago 
 Santa Fe R. R. Co. v. Price, 138 U. S. 185, 195, 11 Sup. Ct. 290, 
 292, 34 L. Ed. 917, it was held that the engineer's certificate was 
 conclusive in the absence of fraud or of such gross error "as to imply 
 bad faith." In United Stales v. Gleason, 175 U. S. 588, 602, 607-608, 
 20 Sup. Ct. 228, 236, 44 L. Ed. 284, an averment that the refusal of 
 the engineer to extend the time for the completion of the contract 
 "was wrongful and unjust, and a breach of the contract" was held 
 "wholly insufficient on which to base an attempt to upset the judg- 
 ment of the engineer." 
 
 To the same effect are several decisions of this court. In Mundy 
 V. Louisville & N. R. Co., 67 Fed. 633, 637, 14 C. C. A. 583, 587, 
 Judge Taft used this language : "The authorities leave no doubt that 
 construction contracts, in which the contra!ctor stipulates that the en- 
 gineer or architect of the owner shall finally and conclusively decide, 
 as between him and the owner, what amount of work has been done, 
 and its character, and the amount to be paid therefor under the con- 
 
632 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 tract, are legal, and should be enforced. In such cases, after the work 
 has been done, the contractor can recover nothing in excess of the 
 amount found due by the engineer, unless he can make it appear 
 that the engineer's decision was fraudulently made, or was founded 
 on palpable mistake." 
 
 In Boyce v. United States Fidelity & Guaranty Co., Ill Fed. 138, 
 142, 49 C. C. A. 276, 280, Judge Severens Used this language: "And 
 if the appointee, without fraud or manifest mistake, makes a deter- 
 mination upon any of the matters falling within the scope of the au- 
 thority committed to him, the parties, are bound by the decision." 
 
 In Memphis Trust Co. v. Brown-Ketchum Iron Works, 166 Fed. 
 398, 403, 93 C. C. A. 162, 167 (where many authorities upon the 
 proposition we are considering are cited), it was said of an agree- 
 ment in a building contract to submit differences to the arbitration of 
 the architect that: "An award made by virtue of such contract pro- 
 vision, in the absence of fraud or of such gross mistake as would im- 
 ply bad faith or a failure to exercise honest judgment, is binding upon 
 both parties thereto, so far as it is confined to disputes actually sub- 
 sisting and open to arbitration." See, also, American Bonding & Trust 
 Co. V. Gibson County, 127 Fed. 671, 62 C. C. A. 397; s. c. 145 Fed. 
 871, 873, 76 C. C. A. 155, 7 Ann. Cas. 522; Choctaw & M. R. Co. v. 
 Newton, 140 Fed. 225, 71 C. C. A. 655. 
 
 The jury could scarcely be expected to understand that the words 
 "unreasonably and unfairiy" meant "in bad faith," for the court 
 charged that, "if their [the plaintiffs'] work and materials did conform 
 to the plans and specifications made by the architect, then the refusal 
 of the architects to accept such work and materials and to issue a cer- 
 tificate of acceptance is not fair and reasonable, and the plaintiffs may 
 recover in excess of $352.69." 
 
 In other words, the actual conformity of the work and materials to 
 the plans and specifications was made the test of the bad faith which 
 the law requires for setting aside the action of the architect. It 
 is strongly insisted that the bad faith of the architect is clearly shown 
 by his refusal to accept the plaintiff's work on account of defects 
 apparent in the detail drawings approved by the architect. While 
 the record was such as to justify submitting to the jury the question 
 whether the architect acted in bad faith in refusing the certificate, 
 and while it is possible that the defendant and the architect as well, 
 in requiring the substituted connections, were influenced by a fear 
 of criticism upon the sufficiency of the building, we cannot say, as a 
 matter of law, that the admitted facts lead only to a conclusion of bad 
 faith on the architect's part. , i 
 
 The error referred to requires a reversal of the judgment. The 
 plaintiff should be- permitted to make any amendment of its pleadings 
 which may be necessary to meet the views we have expressed; 
 
 The conclusion we have reached makes it unnecessary to consider 
 
Sec. 2) CEETIFICATE OF ARCHITECT 633 
 
 the propriety of the instruction that a "capricious and arbitrary" re- 
 fusal to accept avoided the effect of the failure to obtain the certifi- 
 cate; and perhaps the record should not be construed as sufficiently 
 raising that "question. We content ourselves with the suggestion that, 
 if the words referred to are to be used, it should be made clear that 
 they involve either bad faith or a refusal or failure tp exercise honest 
 judgment. 
 
 Judgment reversed, and new trial ordered.^* 
 
 82 A contract making the decision of an architect or engineer final and con- 
 clusive will be enforced, in the absence of fraud or bad faith on his part or on 
 that of the party maintaining the validity of his decision. In such cases his 
 decision is usually a condition precedent to recovery. Shriner v. Craft, 166 
 Ala. 146, 51 South. 884, 28 L. R. A. (N. S.) 450, 139 Am. St. Rep. 19 (1910) ; 
 Hatfield Special School Dist. v. Knight, 112 Ark. 83, 164 S. W. 1137 (1914) ; 
 Boston Store v. Schleuter, 88 Ark. 213, 114 S. W. 242 (1908); American- 
 Hawaiian Engineering & Construction Co. v. Butler, 165 Cal. 497, 133 Pac. 
 280, Ann. Cas. 1916C, 44 (1913) ; Empson Packing Co. v. Clawson, 43 Colo. 1S8, 
 !)5 Pac. 546 (1908) ; Chatfield Co. v. O'Neill, 89 Conn. 172, 93 Atl. 133 (1915) ; 
 Beattie v. McMullen, 82 Conn. 484, 74 Atl. 767 (1909) ; Lohr Bottling Co. v. 
 Ferguson, 223 111. 88, 79 N. E. 35 ; Pope v. King, 108 Md. 37, 69 Atl. 417, 16 L. 
 K. A. (N. S.) 489, 15 Ann. Cas. 970 (1908) ; Marsch v. Southern New England 
 R. Corporation, 230 Mass. 483, 120 N. E. 120 (1918) ; Hathaway v. Stone, 215 
 Mass. 212, 102 N. E. 461 (1913) ; Loftus v. Jorjorian, 194 Mass. 165, 80 N. E. 
 235 (1907) ; Frolich v. Klein, 160 Mich. 142, 125 N. W. 14 (1910), fraud on 
 owner; Landstra v. Bnnn, 81 N. J. Law, 680, 80 Atl. 496 (1911) ; Hoskins v. 
 Powder Land & Irr. Co., 90 Or. 217, 176 Pac. 124 (1918) ; Payne v. Roberts, 
 214 Pa. 568, 64 Atl. 86 (1906) ; Use v. JEtna Indemnity Co., 55 Wash. 487, 104 
 Pac. 787 (1909), fraud on owner; Forrest City Box Co. v. Sims, 208 Fed. 109, 
 125 C. O. A. 337 (1913), fraud of party; Eyre-Shoemaker v. Buffalo R. & P. 
 R. Co., 193 Fed. 387, 113 C. C. A. 313 (1912) ; Cope v. Beaumont, 181 Fed. 756, 
 104 C. C. A. 292 (1910), to permit recovery on a showing that the reihisal is 
 unfair and unreasonable substitutes the jury's opinion of the work for that of 
 the agreed arbiter; Cook v. Foley, 152 Fed. 41, 81 C. C." A. 237 (1907) ; 
 Sheffield & B. Coal, I. & R. Co. v. Gordon, 151 U. S. 285, 14 Sup. Ct. 343, 38 
 L. Ed. 164 (1894) ; Chicago, S. F. & C. R. Co. v. Price, 138 U. S. 185, 11 Sup. 
 Ct. 290, 34 L. Ed. 917 (1891). 
 
 The decision is not final when not so agreed, and particularly when it is 
 agreed that it shall not be. Mercantile Trust Co. v. Hensey, 205 U. S, 298, 
 27 Sup.,Ct. 535, 51 L. Ed. 811, 10 Ann. Cas. 572 (1907). 
 
 A statute declared null and void any provision of a contract making the 
 finding or award of an engineer, architect, or other person final or conclusive 
 or a condition precedent to a right of action ; . this statute was held unconsti- 
 tutional in Adinolfi v. Hazlett, 242 Pa. 25, 88 Atl. 869, 48 L. R. A. (N. S.) 885 
 (1913). 
 
 The certificate of an architect is often made a condition precedent to the 
 power of the owner to terminate the contract and the right to payment by the 
 contractor of the expense of completion. Lenox Const. Co. v. Colonial Const. 
 Co., 93 Conn. 234, 105 Atl. 467 (1919) ; Hoyt v. Pomeroy, 87 Conn. 41, 86 Atl. 
 755 (1913) ; Henry Smith & Sons v. Jewell, 104 Md. 269, 65 Atl. 6 (1908) ; 
 Heidbrink v. Schaffner, 147 Mo. App. 632, 127 S. W. 418 (1910). 
 
 The English courts are strongly in accord with the principal case above. 
 •Clarke v. Watson, 18 C. B. N. S. 278 (1865) ; Tullis v. Jacson, [1892] 3 Ch. 441. 
 
634 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 MARTINSBURG & P. R. CO. v. MARCH. 
 
 (Supreme Court of the United States, 1885. 114 U. S. 549, 5 Sup. Ct. 1035, 
 
 29 L. Ed. 255.) 
 
 Harlan, J.^^ This case is within the principles announced in Kihl- 
 berg V. U. S., 97-U. S. 398, 24 L. "Ed. 1106 and Sweeney v. U. S., 109 
 U. S. 618, 3 Sup. Ct. 344, 27 L. Ed. 1053. Kihlberg sued the United 
 States upon a contract for the transportation of military, Indian, and 
 government stores and supplies from points on the Kansas Pacific 
 Railway to posts and stations in certain states and territories. The 
 contract provided for payment for transportation "in all cases ac- 
 cording to the distance from the place of departure to that of deliv- 
 ery, the distance to be ascertained and fixed by the chief quarter- 
 master of the district of New Mexico, a!nd in no case to exceed the 
 distance by the usual and customary route." One of the issues in 
 that case was as to the authority of that officer to fix, conclusively for 
 the parties, the distances which should govern in the settlement of the 
 contractor's accounts for transportation. There was neither allega- 
 tion nor proof of fraud or bad faith upon the part of that officer in 
 his discharge of the duty imposed upon him by the mutual assent of 
 the parties. This court said : "In the absence of fraud, or such gross 
 mistake as would necessarily imply bad faith, or a failure to exercise 
 an honest judgment, his action in the premises is conclusive upon the 
 appellant as well as upon the government." This principle was af- 
 firmed and applied in Sweeney's Case, in which he sought to recover 
 from the United States the price of a wall built by him around a 
 national cemetery. The contract provided that the wall should be 
 received, and become the property of the United States, after an 
 officer or civil engineer, to be designated by the government to inspect 
 the work, should certify that it was in all respects such as the contractor , 
 agreed to construct. The officer designated for that purpose refused 
 to so certify, on the ground that neither the material nor the workman- 
 ship was such as the contract required. As the officer exercised an 
 honest judgment in making his inspections, and as there was on his 
 part neither fraud, nor such gross mistake as implied bad faith, it was 
 adjudged that the contractor had no cause of action on the contract 
 against the United States. 
 
 Those decisions control the determination of the claim arising out 
 of the contract here in suit, whereby the defendant in error, who was 
 plaintiff below, covenanted and agreed that he would furnish all the 
 material required,- — which should be sound, durable, and of good 
 quality, and approved by the company's chief engineer, — and perform 
 all the labor necessary to construct and finish, in every respect, in the 
 most substantial and workman-like manner, the grading and masonry 
 of a certain section of the Martinsburg & Potomac Railroad. 
 
 8 3 Part of the opinion is omitted. 
 
Sec. 2) CERTIPIOATE CP AECHITEOT 635 
 
 The contract provides that, to prevent all disputes, the engineer of 
 the company "shall, in all cases, determine" the quantity of the sev- 
 eral kinds of work to be paid for under the contract, and the amount of 
 compensation that the appellee should earn at the rates therein speci- 
 fied; that he "shall, in all cases," decide every question which can 
 or may arise relative to the execution of the contract, and "his esti- 
 mate shall be final and conclusive ; " that in» order to enable the con- 
 tractor to prosecute the work advantageously, the engineer "shall 
 make an estimate from time to time, not oftener than once per month, 
 as the work progresses, of the work done," for which the company 
 "will pay in current money within twenty per cent, of the amount of 
 said estimate on presentation ; " that, in calculating the quantity of 
 masonry, walling and excavation, the most rigid geometrical rules 
 should be applied, any custom to the contrary notwithstanding; and 
 that "whenever this contract shall be wholly completed on the part of 
 the said contractor, and the said engineer shall have certified the same, 
 they [the company] will pay fpr said work" the prices in the contract 
 named. These stipulations were emphasized by this additional provi- 
 sion in the agreement : "And it is further agreed that whenever the 
 contract shall be completely performed on the part of the contractor, 
 and the said engineer shall certify the same in writing under his 
 hand, together with his estimate aforesaid, the said company shall, 
 within thirty days after the receipt of said certificate, pay to the said 
 contractor, in current notes, the sum which according to this contract 
 shall be due." ' 
 
 The plaintiff, in his declaration, which is in assumpsit, sets out the 
 written contract in full, and counts specially upon its various provi- 
 sions. The other count is the ordinary one of indebitatus assumpsit. 
 A general demurrer by the company to the whole declaration, and to 
 each count, was overrujed. This action of the court below cannot be 
 upheld , without disregarding the express conditions of the written 
 agreement ; for it does not appear from the declaration that the 
 engineer ever certified in writing the complete performance of the con- 
 tract by the plaintiff, together with an estimate of the work done, and 
 the amount of compensation due him according to the prices established 
 by the parties. Until after the expiration of 30 days from the receipt 
 of such a certificate, the company did not, by the terms of the agree- 
 ment come under a liability to pay the plaintiflf the balance, if any, 
 due to him under the contract. Nor does the declaration state any 
 facts entitling him to sue the company, on the contract, in the absence 
 of such a certificate by the engineer, whose determinatidn was. made by 
 the parties final or conclusive. And upon the supposition that the 
 engineer made such a certificate as that provided by the contract, there 
 is no allegation that entitled the plaintiff to go behind it; for there 
 is no averment that the engineer had been guilty of fraud, or had 
 made such gross mistake in his estimates as necessarily implied bad 
 faith, or had failed to exercise an honest judgmetit in discharging the 
 
636 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 duty imposed upon him. The first count of the declaration was, there- 
 fore, defective for the want of proper averments showing plaintiff's 
 right to sue on the contract, and the demurrer to that count should 
 have been sustained. 
 
 As, for this reason, the case must be remanded for a new trial, it 
 is proper to say that if the declaration had been good on demurrer,, 
 we should have been compelled to reverse the judgment for errors in 
 the instructions given to the jury. Several instructions were asked 
 by the defendant embodying the general proposition that the final es- 
 timate of the engineer was to be taken as conclusive, unless it appeared 
 from the evidence that, in respect thereto, he was guilty of fraud or 
 intentional misconduct. These instructions were modified by the 
 court by adding after the words "fraud or intentional misconduct" the 
 words "or gross mistake." This modification was well calculated to 
 mislead the jury, for they were not informed that the mistake must 
 have been so gross, or of such a nature, as necessarily implied bad 
 faith upon the part of the engineer.- We are to presume from the 
 terms of the contract that both parties considered the possibility of 
 disputes arising between them in reference to the execution of the 
 contract. And it is to be presumed that in their minds was the possi- 
 bility that the engineer might err in his determination of such matters. 
 Consequently, to the end that the interests of neither party should be 
 put in peril by disputes. as to any of the matters covered by their agree- 
 ment, or in reference to the. quantity of the work to be done under 
 it, or the compensation which the plaintiff might be entitled to demand, 
 it was expressly stipulated that the engineer's determination should 
 be final and conclusive. Neither party reserved the right to revise that 
 determination for mere errors or mistakes upon his part. They chose 
 to risk his estimates, and to rely upon their right, which the law pre- 
 sumes they did not intend to waive, to demand that the engineer should, 
 at all times, and in respect of every matter submitted to his determina- 
 tion, exercise an honest judgment, and commit no such mistakes as, 
 under all the circumstances, would imply bad fajth. * * * 
 
 Reversed. 
 
 COPLEW V. DURAND et al. 
 
 (Supreme Court of California, 1908. 153 Cal. 278, 95 Pae. 38, 16 L. E. 
 
 A. [N. S.] 791.) 
 
 Action by D. Coplew against A. W. Durand and another. From a 
 judgment for plaintiff, and an order denying a new trial, defendants 
 appeal. Affirmed. 
 
 Henshaw, J. Plaintiff had entered into a contract with defendants 
 to do the painting, polishing, enameling — in short the "finishing" — of 
 the woodwork and floors of defendants' house. By the terms of the 
 contract progress payments were to be made, 75 per cent, of the con- 
 
Sec. 2) CERTIFICATE OF ARCHITECT 637 
 
 tract price to be paid on completion, and 25 per cent. 36 days after final 
 completion. The progress payments were made as in the contract pro- 
 vided, and this action is brought to recover the 25 per cent, final pay- 
 ment, which defendants refused to make. 
 
 The contract provided that the work was to be "strictly first-class and 
 to be done to the entire satisfaction of the owner and the architect" ; 
 as to the payments, "that in each of said cases a certificate be obtained 
 and signed by the said architect." Defendants' refusal to pay was based 
 upon the declaration of the architect that the work was not first-class 
 and was not done to his satisfaction. Where work is to be done to the 
 satisfaction of a person, evidenced by a certificate to that effect, the pro- 
 duction of such a certificate is a condition precedent to a right of ac- 
 tion upon the contract. This proposition is too well established to be 
 questioned, and, indeed, is not questioned in this case. Holmes v. Rich- 
 et, 56 Cal. 307, 38 Am. Rep. 54; L,oup v. California, etc., Co., 63 Cal. 
 97; Cox v. McLaughlin, 63 Cal. 196; Tally v. Parsons, 131 Cal. 516, 63 
 Pac. 833 ; Kihlberg v. U. S., 97 U. S. 398, 24 L. Ed. 1106; Wangler v. 
 Swift, 90 N. Y. 38 ; 9 Cyc. 618. 
 
 To make his case, in the absence of such certificate, the contractor 
 pleaded and the court found that the work was done to the entire satis- 
 faction of the owner and the architect, and that the refusal to issue the 
 completion certificate was wrongful and was due to plaintiff's refusal to 
 do certain repair work which was not risquired of him by the contract. 
 The evidence, while conflicting, established to the satisfaction of the 
 trial court the following facts : Under the terms of the contract plain- 
 tiff was to-be paid $2,165. The work consisted of the finishing of the 
 woodwork of the doors and walls and the finishing of the hardwood 
 floors. The hardwood floors were naturally the last woodwork to be 
 put in place and the last to be finished by the contractor. The contrac- 
 tor proceeded with his work upon the doors and walls, receiving partial 
 payments. In the early part of August he had completed all this Work, 
 and nothing remained for him to do under his contract but to finish the 
 floors, which were not as yet ready for him. The architect asked the 
 plaintiff what would be the value of the work which he had yet to do 
 upon the floors, and plaintiff replied, "About $200." The architect 
 then stated that he would allow him the full 75 per cent, of the con- 
 tract price, deducting the value of the separate work yet to be done 
 upon the floors, and did so; the architect himself testifying that he 
 knew that he had paid precisely 75 per cent, of the entire contract 
 price, excepting. $200, the cost or the value of the work upon the floors. 
 It is in evidence on behalf of the plaintiff that at the time of the comple- 
 tion of all this woodwork, excepting the floors, the architect and owner 
 both expressed themselves satisfied, with it. This condition of affairs 
 obtained from August 8, 1904, when the last payment, amounting to 75 
 per cent, was made, until January 22, 1905, when plaintiff finally com- 
 pleted the work upon the floors. The delay was through no fault of 
 
638 IMPLIED AND CONSTEUCTIVB CONDITIONS PRECEDENT (Ch. 4 
 
 his. Meantime decorators had been called in, and in doing their work 
 they had injured the work done by plaintiff. This is not disputed, and 
 a separate contract was entered into by defendants with plaintiff to re- 
 pair the damage so occasioned by the decorators. This work, in turn, 
 he did to the apparent satisfaction of the defendants. At least he was 
 paid in full therefor. It is' not satisfactorily explained why at this time 
 he should have been employed at a special price to do this repair work, 
 if, as defendants' architect contends, he was at that time insisting that 
 the original work was incomplete, unsatisfactory, and poor. The 
 floors were done by plaintiff, as the court finds, in a satisfactory and 
 workmanlike manner. Then, when in due course plaintiff demanded 
 his final payment, the architect refused to give him a final certificate, 
 stating that the woodwork had been damaged by water, panels and 
 joists were cracked and would have to be replaced, and that he look- 
 ed to the plaintiff to finish these damaged panels and joists, to which 
 plaintiff replied that he could not be expected to do the work, twice, 
 when he was paid but once for it. Ifi fact it was necessary to replace 
 panels to the number of about 60, and those panels in turn had to be 
 "finished." 
 
 Appellants, however, contend that, notwithstanding these progress 
 payments which had been made, and notwithstanding the fact that the 
 woodwork had been completed to the satisfaction of the architect and 
 owners, and evidence of that completion given by the payment of the 
 75 per cent., still the owners and architect retained a right under the 
 contract to exercise a later judgment, and were not legally required 
 to pass final judgment until the contractor was ready to turn over to 
 them his work as complete. Haynes v. Second Baptist Church, 88 
 Mo. 285, 57 Am. Rep. 413. In this connection it is pointed out that 
 the very finding of the court, while to the effect that the work had 
 been performed to the satisfaction of the architect and owner,, de- 
 clared also that it was not performed in a good and workmanlike 
 manner, so that, whatever payments the owners and architect might 
 choose to make during the progress, they still had the right to refuse 
 the certificate for the final payment if at that time the work had not 
 been performed to their satisfaction under the terms of the contract. 
 This undoubtedly is true. Where, from the nature of the work, there 
 might be latent defects, not discoverable at the time of completion, but 
 becoming patent after the lapse of time, it might be important that the 
 architect should not exercise final judgment until after the lapse of 
 the 36 days ; or where, as the architect contends in this case, the de- 
 fects were apparent, and he frequently called the contractor's atten- 
 tion to them, and paid the 75 per cent, under repeated promises of the 
 contractor to repair the defects before the work was finally turned 
 over for acceptance. Under such circumstances it would unhesitat- 
 ingly be held that there was resen-^ed to the architect the right of final 
 approval or rejection at the expiration of the time named. This was 
 the position of the defendants in this case, and that position was sup- 
 
Sec. 2) CERTIFICATE OP ARCHITECT 639 
 
 ported by the testimony of the architect. But the difficulty which 
 confronts appellants lies in the fact that the court did not accept their 
 version. Its direct finding thut the work was done to the satisfaction 
 of the architect impliedly, but positively, negatives the contention that 
 he was, during all of that time, insisting that the work was imperfect 
 and incomplete. 
 
 The case which is thus presented is one where the work has been 
 completed to the satisfaction of the owner and architect, and the lat- 
 ter thereafter and without warrant refuses to issue his certificate for 
 the final payment. The refusal under these circumstances being un- 
 reasonable, the necessity for the production of the certificate is dis- 
 pensed with. Katz v. Bedford, 77 Cal. 322, 19 Pac. 523, 1 L. R. A. 
 826; Nolan v. Whitney, 88 N. Y. 649; Phillips, etc., Co. v. Seymour, 
 91 U. S. 646, 23 L. Ed. 341. 
 
 For these reasons, the judgment and order appealed from are af- 
 firmed.** 
 
 NOLAN et al. v. WHITNEY. 
 (Court of Appeals of New York, 1882. 88 N. T. 648.) 
 
 In July, 1877, Michael Nolan, the plaintiffs' testator, entered into 
 an agi'eement with the defendant to do the mason work in the erec- 
 tion of two buildings in the city of Brooklyn for the sum of $11,700, 
 to be paid to him by her in instalments as the work progressed. The 
 last instalment of $2,700 was to be paid thirty days after the com- 
 pletion and acceptance of the work. The work was to be performed 
 'to the satisfaction and under the direction of M. J. Morrill, architect, 
 to be testified by his certificate, and that was to be obtained before 
 any payment could be required to be made. As the work progressed, 
 all the instalments were paid except the last, and Nolan, claiming 
 
 ■ 84 Recovery allowed where certificate Is withheld with fraudulent intent. 
 Corse V. Linke, 147 Wis. 410, 133 N. W. 598 (1911) ; Fitzgerald v. Benner, 219 
 m. 485, 76 N. E. 709 (1906), "if the architect inspected the work and accepted 
 it * * * and then refused to deliver the certificate, he was guilty of 
 bad faith"; Blome v. Wahl-Henius Institute of Fermentology, 150 111. App. 
 164 (1909), arbitrary refusal "without any reason or excuse existing or being 
 given" ; Thaler Bros. v. Greisser Const. Co., 229 Pa. 512, 79 Atl. 147, 38 L. R. 
 A. (N. S.) 345 (1911) ; Howard County v. Pesha, 103 Neb. 296, 172 N. W. 55 
 (1919) ; Chism v. Schipper, 51 N. J. Law, 1, 16 Atl. 316, 2 L. B. A. 544, 14 
 Am. St. Rep. 668 (1888). 
 
 So, also, where it is withheld merely at the owner's request and not for 
 errors or omissions that have been passed upon by the architect. American- 
 Hawaiian Engineering & Construction Co. v. Butler, 165 Cal. 497, 133 Pac. 
 280, Ann. Cas. 1916C, 44 (1913) ; Masek v. Chmelik, 169 111. App. 589 (1912) ; 
 Foster v. McKeown, 192 111. 339, 61 N. E. 514 (1901) ; Caldwell & Drake v. 
 Sehmulbach (C. C.) 175 Fed. 429 (1909). 
 
 So, also, where it is withheld solely for a reason that is not within the 
 architect's jurisdiction. Maurer v. School Dist. No. 1, 186 Mich. 223, 152 N. 
 W. 999 (1915) ; Shine v. Hagemeister Realty Cor., 169 Wis. 343, 172 N. W. 
 750 (1919). 
 
040 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 that he had fully performed his agreement, commenced i this action 
 to recover that instalment. The defendant defended the action up- 
 on the ground that Nolan had not fully performed his agreement 
 according to its terms and requirements, ?ind also upon the ground 
 that he had not obtained the architect's certificate, as required by 
 the agreement. 
 
 Upon the trial the defendant gave evidence tending to show that 
 much of the work was imperfectly done, and that the agreement 
 had not been fully kept and performed on the part of Nolan; the 
 latter gave evidence tending to show that the work was properly done, 
 that he had fairly and substantially performed his agreement, and 
 that the architect had refused to give him the certificate, which, by 
 the terms of his agreement, would entitle him to the final payment. 
 The referee found that Nolan completed the mason work required 
 ,by the agreement according to its terms ; that he in good faith intend- 
 ed to comply with, and did substantially comply with, and perform 
 the requirements of his agreement; but that there were trivial de- 
 fects in the plastering for which a deduction of $200 should be made 
 from the last instalment, and he ordered judgment in favor of Nolan 
 for the last instalment, less $200. 
 
 The Court say : "It is a general rule of law that a party must per- 
 form his contract before he can claim the consideration due him upon 
 performance ; but the performance need not in all cases be literal and 
 exact. It is sufficient if the party bound to perform, acting in good 
 faith, and intending and attempting to perform his contract, does so 
 substantially, and then he may recover for his work, notwithstanding 
 slight or trivial defects in performance, for which compensation may 
 be made by an allowance to the other party. Whether a contract has 
 been substantially performed is a question of fact depending upon all 
 the circumstances of the case to be determined by the trial court. 
 Smith V. Brady, 17 N. Y. 189, 72 Am. Dec. 442 ; Thomas v. Fleury, 
 26 N. Y. 26; Glacius v. Black, 50 N. Y. 145, 10 Am. Rep. 449; John- 
 son V. DePeyster, 50 N. Y. 666; Phillip v. Gallant, 62 N. Y. 256;. 
 Bowery Nat. Bank v. The Mayor, 63 N. Y. 336. According to the 
 authorities cited under an allegation of substantial performance Upon 
 the facts found by the referee, Nolan was entitled to recover unless he 
 is barred because he failed to get the architect's certificate, which the 
 referee found was unreasonably and improperly refused. But when 
 he had substantially performed his contract,, the architect was bound 
 to give him the certificate, and his refusal to give it was unreasonable, 
 and it is held that an unreasonable refusal on the part of an architect 
 in such a case to give the certificate dispenses with its necessity." 
 
 Earl, J., reads for affirmance. All concur. 
 
 Judgment affirmed. "^ 
 
 85 In accord : Kling v. Bucher, 32 Cal. App. 679, 163 Pac. 871 (1917), court 
 found contract fully perforined ; Cornell & Co. v. Steele, 109 Va. 589, 64 S. E. 
 1088, 132. Am. St. Rep. 931 (1909), refusal of certificate grossly erroneous, but 
 
^ec. 2) CERTIFICATE OF ARCHITECT 
 
 641 
 
 HEBERT V. I>EWEY. 
 (Supreme Judicial Court of Massachusetts, 1906. 191 Mass. 403, 77 N. E. 822.) 
 
 Two actions. The first by Valerie Hebert, administratrix, against 
 P. H. Dewey ; the second by Dewey against Hebert. Rulings were ad- 
 verse to Dewey, and he excepted. In second action, exceptions over- 
 ruled ; in first action, exceptions sustained. 
 
 Knowlton, C. J. The first of these actions was brought by the 
 plaintiff's intestate to recover upon a contract in writing for building 
 a house for the defendant, and also for extra work done in connection 
 with the contract. * * * '° 
 
 The first important exception relates to the rulings and refusals 
 to rule in regard to certificates given to the plaintiff's intestate by the 
 architect, upon which payments were made by the defendant under 
 the contract. The contract provided for three payments to be made 
 at different stages in the progress of the work, and a fourth after 
 the completion of it. Then followed this proviso : "That in each case 
 of the said payments, a certificate shall be obtained from and signed 
 by said F. S. Newman, architect, to the effect that the work is done 
 in strict accordance with the drawings and specifications, and that 
 he considers the payment properly due; said certificate, however, in 
 no way lessening the total and final responsibility of the contractor; 
 neither shall it exempt the contractor from liability to replace work, 
 if it be afterwards discovered to have been done ill, or not according 
 to the drawings and specifications, either in execution or materials," 
 etc. 
 
 The third certificate, in its substantive parts, is as follows : "This is 
 to certify that under the terms of the contract dated," etc., "Mr. Joseph 
 Hebert, contractor for building your house, is entitled to the third pay- 
 ment, amounting to $1,200." The first and second certificates were in 
 the same form; but the architect refused to give the fourth and final 
 certificate, and the plaintiff's intestate never obtained it. At the trial 
 the evidence was conflicting upon all the questions in issue, and there 
 was much dispute as to whether the plaintiff's intestate had performed 
 the contract, or had done improper work and used iitiproper materials in 
 violation of it. The judge instructed the jury, in substance, that so far 
 as the work and materials which had previously been supplied were 
 known to the architect at the time of giving one of these certificates, the 
 certificate would be conclusive upon the defendant as to the quality 
 
 not fraudulent; Johnson & Grommet Bros. v. Bunn & Monteiro, 114 Va. 222, 
 76 S. B. 310 (1912) ; Richmond College v. Scott-Nuckols Co., 124 Va. 333, 98 
 S. E. 1 (1919) ; Scully v. TJ. S. (D. C.) 197 Fed. 327 (1912), "it is not neces- 
 sary that there should be actual fraud or intentional wrong; it is enough if 
 there has been an arbitrary, unreasonable, or unjust refusal." See Audette 
 V. L'Union St. Joseph, ante, p. 489. 
 
 '8 Part of the opinion is omitted. No question affecting the defendant's 
 cross-action is of present interest. 
 
 COBBIN OONT 41 
 
642 IMPLIED AND CONSTRUCTIVE CONDITIONS PEECEDENT (Ch. 4 
 
 and fitness of the work and materials, and it would not afterwards 
 be open to the architect or the owner to question it. He treated each 
 of these certificates as a final determination, in favor of the contrac- 
 tor, that the contract had been properly performed up to that time, in 
 all parts of which the architect had knowledge. It is well settled that, 
 in the absence of fraud, or such mistake as prevents him from exer- 
 cising his judgment upon the case, the parties are bound by the certifi- 
 cate of an architect, made under the authority of a building contract 
 like that now before us. His position is like that of an arbitrator, to 
 determine the particular matter submitted to him. Palmer v. Clark, 
 106 Miass. 373, 389 ; Flint v.. Gibson, 106 Mass. 391 ; Robbins v. 
 Clark, 129 Mass. 145. National Contracting Co. v. Com., 183 Mass. 
 89, 66 N. E. 639; Norcross v. Wyman, 187 Mass. 25, 72 N. E. 347; 
 White V. Abbott, 188 Mass. 99, 74 N. E. 305. 
 
 The only question of difficulty in this part of the case arises from 
 the peculiar language of the contract as to the effect of the certificates. 
 They are referred to as "in no way lessening the total and final respon- 
 sibility of the contractor." etc. This language furnishes ground for 
 an argument that the certificates given prior to the completion of the 
 work were intended to be merely intermediate or progress certificates, 
 for the benefit of. the builder, given to enable him to obtain payments 
 on, account, during the progress of the work. Such certificates are 
 not conclusive as to the final payment, nor upon a claim for damages, 
 nor on a quantum meruit. 1 Hudson, Building Contracts, 288 ; Thar- 
 sis Sulphur & Copper Co. v. McEIroy, 3 App. Cas. 1040; Ford v. Rail- 
 road Co., '54 Iowa, 723, 7 N. W. 126. While the matter is not free 
 from doubt, we are inclined to hold that these certificates were intended 
 to be something more than progress certificates, and that they are 
 to be held final in their determination of all matters which were then 
 within the knowledge of the architect. In the first place, the contract 
 makes no distinction in this particular between the certificates to be 
 given before the work is completed and the final certificate. Then 
 the special provision as to the effect is that they shall not relieve 
 the contractor from liability for inferior work, "if it be afterwards 
 discovered to have been done ill, * * * either in execution or 
 materials," etc. Inasmuch as the general rule would make such certifi- 
 cates conclusive, we are of opinion that they should be held to leave 
 the claims open only as to deficiencies that are afterwards discovered, 
 and that this exception of the defendant should be overruled.*^ 
 
 The defendant contended that the plaintiff could not recover under 
 the contract, because here intestate failed to obtain from the architect 
 a certificate that the final payment was due. The question is whether a 
 sufficient justification was shown for this failure. The instruction to 
 the jury on this point was as follows: "If the defendant's architect 
 
 8 7 Of. Mercantile Trust Co. v. Hensey, 205 U. S. 298, 27 Sup. Ct. 535, 51 L. 
 Ed. 811, 10 Ann. Oas. 572 (1907). 
 
Sec. 2) CERTIFICATE OP ARCHITECT 643 
 
 capriciously withheld the final certificate, and capriciously allowed the 
 contractor to believe that nothing more remained to be done to entitle 
 him to such certificate, the contractor is thereby relieved from his 
 obligation to secure the certificate." This was in accordance with the 
 plaintiff^'s request, except that the judge left out the word "fraudu- 
 lently" which was used in the request with "capriciously." The law 
 bearing upon this part of the case has not been definitely settled in this 
 commonwealth. There is a class of cases arising under policies of in- 
 surance and other similar contracts, in which it is held that the pro- 
 curement of the" certificate, called for by the contract, is a condition 
 precedent to the plaintiff's recovery. Johnson v. Phoenix Ins. Co., 112 
 M]ass. 49, 17 Am. Rep. 65; Audette v. L'Union St. Joseph, 178 Mass. 
 113, 59 N. E. 668, and cases there cited. The reason why it is not open 
 to the plaintiff in these cases to show that he could not obtain the 
 certificate, is because the nature of the contract and the purpose of 
 the requirement of a certificate are such as to make the recovery 
 conditional upon the presentation of the paper, for the purpose of 
 affording the insurer an assurance against fraud, and giving him ad- 
 ditional evidence that there is a legal liability. Johnson v. Phoenix 
 Ins. Co., ubi supra. The promise is to pay only upon the existence of 
 conditions shown by a particular kind of proof, which the parties 
 prescribe as the only evidence that will be deemed sufficient to establish 
 the fact. In such contracts the plaintiff takes upon himself the ob- 
 ligation to furnish the required, proof, and assumes the risk of what- 
 ever difficulty there may be in procuring it. Whether a contract is of 
 this kind is a question of construction, dependent upon the meaning 
 of the parties, as ascertained from the writing. A provision for a cer- 
 tificate by an architect, in a building contract, stands differently. 'The 
 architect is the agent of the owner, to perform an act for the conven- 
 ience of both parties, in regard to a matter with which he is directly 
 connected as an employe. It is assumed by the contracting parties and 
 implied in the contract that he will do his duty, and will act in good 
 faith in determining whether a certificate should be granted. 
 
 In cases under provisions like the one before us, it is everywhere 
 held that the contractor may recover without a certificate, if the cir- 
 cumstances relieve him from the obligation to obtain one. What 
 circumstances are sufficient for this purpose is the only question. If 
 the owner wrongfully interferes to prevent the giving of a certifi- 
 cate, it is universally held that this will entitle the contractor to recover 
 without it. Beharrell v. Quimby, 162 Mass. 571, 575, 39 N. E. 407; 
 Whitten V. New England Live Stock Co., 165 Mass. 343, 345, 43 N. 
 E. 121; Batterbury v. Vyse, 2 H. & C. 42; Whelen v. Boyd, 114;Pa. 
 228, 6 Atl. 384. Many of the authorities are to the effect that any 
 wrongful refusal of the architect to give a certificate will entitle the 
 contractor to proceed without one. In some of the cases it is said 
 that if the architect unreasonably refuses to give a certificate it is 
 eiiough. Nolan v. Whitney, 88 N. Y. 648; Flaherty v. Miner, 123 N. 
 
(544 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 Y. 382, 390, 25 N. E. 418; Thomas v. Stewart, 132 N. Y. 580, 30 N. 
 E. 577; Crouch v. Gutmann, 134 N. Y. 45, 31 N. E. 271, 30 Am. St. 
 Rep. 608; United States v. Robeson, 9 Pet. 319, 327, 9 L. Ed. 142. 
 In others it appeared that he refused "dishonestly and arbitrarily," or 
 "willfully and fraudulently," or "capriciously." Bentley v. Davidson, 
 74 Wis. 420, 43 N. W. 139; Chism v. Schipper, 51 N. J. Law, 1, 16 
 Atl. 316, 2 L. R. A. 544, 14 Am. St. Rep. 668; Bradner v. Roffsell. 57 
 N. J. Law, 32, 29 Atl. 317; Id., 57 N. J. Law, 412, 31 Atl. 387; 
 Badger v. Kerber, 61 111. 328. In Beharrell v. Quimby, 162 Mass. 571, 
 575, 39 N. E. 407, 409, there is an implication that if the architect 
 "had fraudulently or capriciously withheld a final certificate," the 
 plaintiff might have recovered without it. 
 
 In the present case there was evidence from which the jury might 
 have found that after a complete performance of the contract the 
 plaintiff's intestate applied to the architect for the final certificate, and 
 he willfully and fraudulently refused to give it. It is plain that in 
 making the contract it was imderstood between the patties that the 
 architect would act in good faith in the performance of this part of 
 his duty. In legal effect, the contract is as if their understanding in 
 this particular had been written into it, as one of its terms. If, under 
 such an agreement, after the full performance of. the contract, the 
 architect willfully and fraudulently refuses to act, or dies, or be- 
 comes disqualified, and there is no provision for such a case, the ques- 
 tion arises whether the contractor is entitled to receive the contract 
 price, the fact of performance being shown in some other way, or 
 whether the entire contract falls to the ground, and the parties are left 
 to enforce their rights under a quantum meruit. It is a general rule 
 that if an implied condition that fails is of the essence of the con- 
 tract, and enters largely into the consideration, in such a way that 
 there can be no substantial performance under the changed condi- 
 tions, the whole contract will fail, and the parties may have rea- 
 sonable compensation for what thev have done in reliance upon 
 it. Butterfield v. Byron, 153 Mass. 517, 27 N. E. 667, 12 L R. A. 
 571, 25 Am. St. Rep. 654. But the provision in this case for the 
 ascertainment of their rights, in reference to the construction of the 
 building called for by the contract is of a different kind. It is a 
 part of the machinery provided for the ascertainment and adjust- 
 ment of their rights in reference to the matters to which the contract 
 relates. It is provided to be used only upon an implied condition that 
 it will be available for use. If, through the death or incapacity of the 
 architect, or his willful refusal to act, it becomes impossible to adopt 
 this method of determining the rights of the parties, other means may 
 be adopted, on the ground that this no longer remains as an essential 
 term of the agreement. In all substantial particulars the contract is 
 complete without the provision for obtaining a final certificate, and, in 
 the case supposed, it should be treated as if the provision were strick- 
 en from the contract. In Whitten v. New England Live Stock Insur- 
 
Sec. 2) CERTIFICATE OF ARCHITICT 645 
 
 ance Co., 165 Mass. 343, 345, 43 N. E. 121, this was held to be the 
 eflfect of an interposition by a party to prevent that from happening, 
 upon the happening of which he was to make a payment under a 
 contract. 
 
 A provision like the one before us in this kind of contract, where 
 the substance of the consideration on one side is valuable property in 
 the form of labor and materials, is materially different from the pro- 
 vision in the policies of insurance to which we have referred. In these 
 contracts for insurance a small sum is paid on one side to obtain in- 
 demnity from the possible consequences of a risk which is very likely 
 to cause damage. The compensation is to be paid only for genuine 
 losses, resulting from the risk insured against. Satisfactory proof of 
 their character, as coming within the policy, is of the veiy essence of 
 the contract. On that depends the obligation of the insurer to pay a 
 very large sum for which only a small consideration is given. In view 
 of the ease with which frauds may be practiced, the parties sometimes 
 prescribe a method of establishing the validity of the claim, which 
 they make essential to its recognition. They say, in effect, that the 
 policy shall apply Only to claims established in this way, and they 
 thereby make the production of the prescribed certificate of the very 
 essence of the contract. It is only to contracts which are construed 
 as showing such a strict agreement that this rule is applied. Whether 
 any of these insurance contracts should be held to require the produc- 
 tion of a certificate as a condition precedent to recovery, if the person 
 who is to give it is incapacitated from acting, or fraudulently refuses 
 to act, is a question which we need not consider in this case. In re- 
 gard to such questions the rights of the parties depend upon what is 
 their meaning and intention as shown by their contracts as applied to 
 the subject with which they are dealing. We do not intend to extend 
 the doctrine of the insurance cases beyond the statements in our de- 
 cisions. 
 
 In all the cases that we have cited under building contracts, it is 
 held that there may be a recovery upon the contract, where the con- 
 tractor's failure to obtain the architect's certificate showing perform- 
 ance of it is caused by the fraud or intentional misconduct of the ar- 
 chitect. In United States v. Robeson, 9 Pet. 319,^ 327, 9 L. Ed. 142, a 
 case where the contract entitled the plaintiff to payment on the cer- 
 tificate of a colonel, commanding a party, Mr.. Justice McLean said 
 in the opinion : "Had the defendant proved that application has been 
 made to the commanding officer for the proper certificates, and that 
 he refused to give them, it would have been proper to receive other 
 evidence to establish the claim." In Whelen v. Boyd, 114 Pa. 228, 
 232, 6 Atl. 384, 386, the court said of the defendant, in reference to 
 the refusal of a certificate : "The law is settled that he camiot take 
 advantage of his own or his agent's wrong." In Baltimore & Ohio ,R. 
 R. v. Polly, Woods & Co., 14 Grat. (Va.) 447, 464, this language is 
 used, in reference to the same subject-: "The principal cannot take ad- 
 
646 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 •vantage of the fraud of his agent, even though he did not actually par- 
 ticipate in the perpetration of the fraud." Other cases, indicating 
 that, where the plaintiff is excused from obtaining such a certificate, 
 the recovery may be on the contract itself, are Herrick v. Belknap's 
 Estate and the Vermont Central R. R., 27 Vt. 673, 681, and Batchelor 
 V. Kirkbride (C. C.) 26 Fed. 899. We have found no case of this kind 
 in which it is held, on a failure to obtain an architect's certificate aft- 
 er performance of a contract, that the contract lost its force, and that 
 the parties were left to their rights upon a quantum meniit. 
 
 In a case like the present, we are of opinion that if an architect aft- 
 er the completion of a contract willfully, and without excuse, refuses 
 to act at all, or if he acts dishonestly and in bad faith, and the con- 
 tractor is thereby prevented from obtaining a certificate, the contrac- 
 tor may proceed with his suit without it. Such action or refusal to act 
 would leave the provision for obtaining an architect's certificate of no 
 effect upon the rights of either party. The judge followed the in- 
 struction quoted with other instructions which went too fat in reliev- 
 ing the plaintiff from obligation to obtain the certificate. He said: 
 "If the fact was that after Mr. Hebert had finished the contract so 
 far as he thought it required him to do work and furnished material, 
 and when he called upon Mr. Macauley or Mr. Newman to come there 
 and see whether the thing was right, and if it was, to give him a cer- 
 tificate, and if not, tell him what work was to be done, and he would 
 do it. Mr. Macauley went there and pointed out where things were 
 necessary to be done, and then a certificate could be given, and Guy- 
 man or Mr. Hebert caused those things, to be done, and the doing of 
 those things was said to be all that was required, and they were done, 
 and then Mr. Newman the [architect] refused to give the certificate, 
 or to come to the premises to look them over and see whether in these 
 respects the added matters were sufficiently done, and they were suf- 
 ficiently done, then the architect's certificate would drop out of sight 
 and not be required." The facts here stated would be evidence from 
 which the jury might find that the plaintiff's intestate was excused 
 from obtaining the certificate; but it cannot be said as matter of law 
 that they would excuse him. The architect, in the meantime, might 
 have discovered other things which justified him in refusing the cer- 
 tificate. 
 
 After telling the jury that certain conduct of Dewey would not be 
 fraudulent in reference to the certificate, he added: "It would still 
 have to be shown by the plaintiff that the certificate ought to have 
 been given, and if it was shown that the work was done and the con- 
 tract substantially performed, then the fact that the certificate was not 
 given was not of any account." This last proposition was not correct 
 in law. If the architect, acting in good faith, thought that the work 
 was not properly done and the contract was not substantially perform- 
 ed, and refused the certificate for that reason, the mere fact that the 
 certificate ought to have been given, and that the work was done, and 
 
Sec. 2) SUBSTANTIAL PERFORMANCE 647 
 
 the contract was performed, would not entitle tl;ie plaintiff to recover 
 without the certificate. The parties were bound by the decision of the 
 architect made in good faith. The judge also gave the following in- 
 struction : "Under the law as I have instructed you I do not know as 
 it would make any difference what was the conduct of Mr. Dewey^ 
 whether he tried improperly to get the architect to withhold the cer- 
 tificate, because if the work was properly done then the certificate 
 ought to have been given. If the work was not properly done, and 
 was so- far improperly done as to render it no performance of the 
 contract by Hebert, then the certificate would not avail. Perhaps it is 
 only in the event that although the contract was not performed, still 
 there were particulars iri which it could be compensated for, and cer- 
 tain things could be done by Mr. Dewey to remedy it, in that event, 
 but even in that event I don't see that the certificate would make any 
 difference." Because these instructions give too little effect to the re- 
 quirement that the contractor shall procure a certificate from the archi- 
 tect before he is entitled to payment, there must be a new trial. We 
 deem it unnecessary to discuss other questions raised -by the bill of ex- 
 ceptions. 
 
 In the second action the exceptions are overruled. In the first ac- 
 tion the entry will be : 
 
 Exceptions sustained. 
 
 (g) Substantial Performance as Fulfillment of Condition 
 
 HANDY v. BLISS. 
 (Supreme Judicial Court of Massachusetts, 1910. 204 Mass. 513, 90 N. E. 864.) 
 
 Action by Herman P. Handy against Nancy E. Bliss. Verdict for 
 plaintiff, and defendant excepted. Exceptions sustained. 
 
 Knowlton, C. J.** This is an action to recover a balance due a con- 
 tractor for the construction of a building. One of the counts was 
 upon an account annexed, which opened to the plaintiff the right of 
 recovery upon a quantum meruit for labor and materials. The defend- 
 ant requested, among others, the following instructions : 
 
 "(1) That if the jury believe that pages 1 and 2 of the specifications, 
 entitled 'General Conditions,' were a part of the contract, there could 
 be no recovery on the ground of substantial performance. 
 
 "(2) If tlie jury shall be of the opinion that pages 1 and 2 of the 
 specifications, entitled 'General Conditions,' were not a part of the orig- 
 injil contract, then that where a payment is due only on the comple- 
 tion of the contract as here, the plaintiff must show substantial com- 
 pletion ; that is, if the plaintiff knowingly omitted to do certain things 
 required by the contract, and they are of such a nature that the work is 
 
 *' Part of the opinion is omitted. 
 
048 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 complete in all mat^ial respects, then the contractor may recover 
 the contract price, less what it would necessarily cost to complete the 
 work ; but the performance, so far as it goes, must be in exact compli- 
 ance with the terms of the contract; that to constitute substantial per- 
 formance, a general adherence to the plans and specifications is not 
 sufficient; the builder not being entitled to willfully or carelessly depart 
 from minute details, or to leave his work incomplete in any material 
 respect; that the builder is not entitled to make changes that are so 
 substantial that an allowance out of the contract price will not give 
 the owner substantially what he contracted for, or to omit work that 
 cannot be done by the owner except at great expense or with great risk 
 to the building. 
 
 "(3) That this doctrine of substantial performance does not apply 
 where omissions by the builder were intentional, or where the contract 
 is to be performed to the satisfaction of the owner." 
 
 The law relative to the matters mentioned in these requests has been 
 considered in different cases, -and it was discussed at length in Bowen 
 y. Kimbell, 203 Mass. 364, 89 N. E. 542, 133 Am. St. Rep. 302. To en- 
 title the plaintiff to recover in a case of this kind there must be an honest 
 intention to perform the contract and an attempt to perform it. There 
 must be such an approximation to complete performance that the owner 
 obtains substantially what was called for by the contract, although it 
 may not be the same in every particular, and although there may be 
 omissions and imperfections on account of which there should be a 
 deduction from the contract price. It is not necessary that the work 
 should be complete in all material tespects, nor that there should be 
 no omissions of work that cannot be done by the owner except at great 
 expense or with great risk to the building. There may be omissions 
 of that which could not afterwards be supplied exactly as called for by 
 the contract without taking down the building to its foundations, and 
 at the same time the omission may not affect the value of the building 
 for use or otherwise, except so slightly as to be hardly appreciable. 
 Notwithstanding such an omission, there might be a substantial per- 
 formance of the contract. 
 
 There is no, reason why the doctrine of substantial performance 
 should not apply where the contract is to be performed to the satis- 
 faction of the owner, according to the usual meaning of this expres- 
 sion as applied to contracts of this kind, namely, to his satisfaction, 
 so far as he is acting reasonably in considering the work in connection 
 with the contract. This doctrine does not apply where the builder 
 intends not to perform the contract. But an intentional omission to 
 do certain things called for by the contract, if he believes that they 
 are not called for, and intends in good faith to do all that he has agreed 
 to do, does not prevent the application of the doctrine. These requests 
 for rulings were rightly refused. 
 
 Another request, numbered 3, relates to the requirements that the 
 work should be done "to the entire satisfaction and approval of the 
 
Sec. 2) SUBSTANTIAL PEKFORMANCE 649 
 
 owner." The question is whether this language means that the owner 
 must act .reasonably i-n determining whether the work is satisfactory, 
 or whether, if he acts in good faith, he may decline to be satisfied and 
 refuse his approval upon a whimsical and unreasonable exercise Of per- 
 sonal taste or prejudice. Sometimes ft is difficult to determine which 
 construction should be given to a contract of this kind. Cases in which 
 the language has been given the former meaning are: Hawkins v. Gra- 
 ham, 149 Mass. 284, 21 N. E. 312, 14 Am. St. Rep. 422 ; Noyes v. East- 
 ern Accident Ass'n, 190 Mass. 171, 76 N. E. 665 ; Lockwood Mfg. Co. 
 V. Mason Regulator Co., 183 Mass. 25, 66 N. E. 420. See C. W. Hunt 
 & Co. v. Boston Elev. Ry. Co* 199 Mass. 227, 85 N. E. 446 ; Cashman 
 V. Proctor, 200 Mass. 272, 86 N. E. 284; Webber v. Cambridge Sav. 
 Bank, 186 Mass. 314, 71 N. E. 567. Contracts which are given the lat- 
 ter meaning are found in Williams Mfg. Co. v. Standard Brass Co., 
 173 Mass. 356, 53 N. E. 862; White v. Randall, 153 Mass. 394, 26 
 N. E. 1071 ; Whittemore v. New York, New Haven & Hartford R. R., 
 191 Mass. 392, 77 N.'E. 717. 
 
 Where the subject-matter of the contract seems to involve questions 
 of personal taste or prejudice, and especially when in such a case no 
 benefit will pass under the contract unless the work is accepted, there 
 is more reason for giving such language the latter construction. But 
 as was said in Hawkins v. Graliam, ubi supra, "when the consideration 
 furnished is of such a nature that its value will be lost to the plaintiff, 
 either wholly or in great part unless paid for, a just hesitation must 
 be felt and clear language required before deciding that payment is left 
 to the will, or even to the idiosyncrasies of the interested party. In 
 different cases, courts have been inclined tO' construe agreements of this 
 class as agreements to do the thing in such a way as reasonably ought 
 to satisfy the defendant." 
 
 The erection of a building upon real estate ordinarily confers a benefit 
 upon the owner, and he should not be permitted to escape payment for 
 it on account of a personal idiosyncrasy. Indeed, under the law of 
 Massachusetts, this question is usually of little practical application to 
 contracts for buildings upon real estate; for if the contract is not per- 
 formed by reason of the failure of the owner to be satisfied with that 
 which ought to satisfy him, there can be a recovery upon a quantum 
 meruit ; and in most cases the deduction that would be made from the 
 contract price, for the difference between the literal performance of 
 the contract and that which would have been a complete performance 
 if the owner had acted reasonably and accepted the work, would be lit- 
 tle if anything. This request for an instruction was rightly re- 
 fused. * * * 
 
 Exceptions sustained.^' 
 
 89 In the case of a construction contract not expressly creating a condition 
 precedent, the plaintiff can recover the contract price on a showing that he 
 has substantially performed as he agreed. The defendant will have a counter- 
 
650 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 MANITOWOC STEAM BOILER WORKS v. MANITOWOC 
 
 GLUE CO. 
 (Supreme Court of Wisconsin, 1903. 120 Wis. 1, 97 N. W. 515.) 
 
 Action by the Manitowoc Steam Boiler Works against the Manito- 
 woc Glue Company. From a judgment in favor of plaintiff, defend- 
 ant appeals. Reversed. '"' 
 
 Action to recover the contract price and enforce a lien for supply- 
 ing a steam boiler to the defendant. The evidence disclosed that the 
 defendant operated a glue factory, requirtng a large amount of steam, 
 not only for power, but also for heating and drying; that it had an 
 old tubular boiler, which had been manufactured by the .plaintiff, and 
 with which and its use the plaintiff was entirely familiar ;, that in such 
 situation the parties negotiated for a new boiler, the defendant stat- 
 ing to the plaintiff that the old boiler was inadequate — that it had a 
 commercial rating of about 80 horse power, and that one was needed 
 of about 100 horse power. The plaintiff's manager counseled one still 
 larger, namely, to. rate about 125 horse power, as compared with the old 
 one, 80 horse power. The agreement finally reached was that the new 
 one should be substantially of 50 per cent, more capacity than the old, 
 but was to be of the Scotch type, instead of the tubular type. Plaintiff 
 constructed a boiler of the Scotch type, put it in place in a building and 
 upon brick foundation constructed by the defendant for that purpose. 
 After it was connected up, it was found disappointing in capacity, and 
 not up to the old boiler, but was used, in connection with the old one, 
 to furnish the steam necessary for the factory, while efforts were 
 made both by plaintiff and defendant to make it work more efficiently. 
 These efforts being still unsatisfactory, the defendant complained of 
 the boiler as not satisfying the contract, and, as the defendant's man- 
 ager testifies, desired to have it taken away.' The plaintiff's manager 
 testifies that thereupon he proposed to have a test made, and, if it did 
 not satisfy the contract, he would either take it out and put in a new 
 one, or enlarge it so as to make it of the necessary capacity. That 
 test was made, the plaintiff contending that it showed the boiler to 
 satisfy the contract, the defendant contending tliat it did not, but 
 meanwhile using the boiler to supply in part the steam needed to 
 keep its factory running. * + * Thereupon the court made find- 
 ings that the plaintiff' had substantially performed its contract, except 
 
 claim for defects. Dyer v. Lintz, 76 N. J. Law, 204, 68 Atl. 908 (1908) ; 
 Peterson v. Pusey, 237 111. 204, 86 N. E. 692 (1908) ; Edmunds v. WelUng, 57 
 Or. 103, 110 Pac. 533 (1910) ; Otis Elevator Co. v. Flanders Realty Co., 244 
 Pa. 186, 90 Atl. 624 (1914) ; Pressy v. McCornack, 235 Pa. 443, 84 Atl. 427 
 (1912) ; Stratmeyer v. Hoyt (Iowa) 174 N. W. 243 (1919) ; City of St. 
 Charles v. Stookey, 154 Fed. 772, 85 C. C. A. 494 (1907) ; Omaha Water Co. 
 V. Oiiiaha, 156 Fed. 922, 85 C. C. A. 54 (1907) ; Northwestern Terra Cotta Co. v. 
 Caldwell, 234 Fed. 491, 148 C. C. A. 257 (1916), seller supplied only 99%^ per 
 cent, of material, agreed. 
 8" Parts of the report are omitted. 
 
Sec. 2) SUBSTANTIAL PERFORMANCE 651 
 
 that, instead of a boiler 50 per cent, greater than the^ old one, it had 
 supplied one of about 20 per cent, less capacity; that defendant had 
 accepted the boiler; and that the reasonable value thereof was the 
 original contract price of $2,035, for which, less the payments, judg- 
 ment was rendered, from which the defendant brings this appeal. 
 
 Dodge, J. (after stating the facts). The result of this action, where- 
 by the defendant is required to pay the full contract price for a boiler 
 of only about one-half tb.e capacity or value of that for which it 
 agreed to pay, is somewhat startling, especially in view of the con- 
 sideration, understood by both parties, that its only reason for buying 
 a new boiler at all was that the operation of the factory required more 
 steam than the old one could supply. Before reaching such a result, 
 a court should pause to re-examine the rules of law or processes of 
 reasoning upon which it is based. If the law warrants it, the force 
 or value of a contract seems to have vanished, the contractor re- 
 ceives the same compensation for nonperformance as for perform- 
 ance. The general rule of law is firmly established that he who makes 
 an entire contract can recover no pay unless he performs it entirely 
 and according to its terms. Moritz v. Larsen, 70 Wis. 569, 36 N. Wi 
 331; Gohn v. Plumer, 88 Wis. 622, 60 N. W. 1000; Widman v. Gay, 
 104 Wis. '277, 80 N. W. 450. This general rule has, with considerable 
 hesitation, been relaxed for equitable considerations in certain ex- 
 ceptional situations where it is believed to work hardship: 
 
 ■First, in favor of laborers who contract to perform personal servr 
 ices, and without fault of either party fail of complete performance 
 (Diefenback v. Stark, 56 Wis. 462, 466, 14 N. W. 621, 43 Am. Rep. 719; 
 Walsh V. Fisher, 102 Wis. 172, 78 N. W. 437, 43 L. R. A. 810, 72 
 Am. St. Rep. 865 ; Hildebrand v. Amer. F. A. Co., 109 Wis. 171, 85 
 N. W. 268, 53 ly. R. A. 826) ; secondly, in building contracts, where 
 the contractor constructs something on the land of another which by 
 oversight, but in good-faith effort to perform fails to entirely satisfy 
 the contract, but is so substantially in compliance therewith that the 
 structure fully accomplishes the purpose of that contracted for, and 
 the other party voluntarily accepts the benefit thereof, or where the 
 failure is mere inconsiderable incompleteness, and the expense of 
 completion is easy of ascertainment (Malbon v. Birney, 11 Wis. 107; 
 Fuller, etc., Co. v. Shurts, 95 Wis. 606, 70 N. W. 683 ; Williams v. 
 Thrall, 101 Wis. 337, 76 N. W. 599; Laycock v. Parker, 103 Wis. 
 161, 79 N. W. 327; Pritzlaflf Co. v. Berghoefer, 103 Wis. 359, 79 N. 
 W. 564; Taft v. Montague, 14 Mass. 282, 7 Am. Dec. 215; Smith v.' 
 School Dist, 20 Conn. 312; Bozarth v. Dudley, 44 N. J. Law, 304, 43 
 Am. Rep. Z7Z; Smith v. Brady, 17 N. Y. 173, 72 Am. Dec. 442; Der- 
 mott v. Jones, 2 Wall. 1, 17 L. Ed. 762 ; and, thirdly, where the con- 
 •tractor supplies an article diffeirent from or inferior to that promised, 
 and the recipient, having full opportunity to reject without loss or in- 
 jury, decides to accept and retain the thing furnished. 
 
 This third phase is hardly an exception, for such voluntary accept- 
 
652 IMPLIED AND CONSTRUCTIVE CONDITIONS PKECEDENT (Ch- 4 
 
 ance may well be deemed the making of a new contract to take and 
 pay reasonably for the article which does not satisfy the original con- 
 tract. Fuller, etc., Co., v. Shurts, supra; Williams v. Thrall, supra. 
 In case of either of these exceptions, great caution is due in order 
 that the innocent purchaser shall not suffer. If loss must fall any- 
 where, it should rest on him who breaks the contiract. As said in Al- 
 len V. McKibbin, 5 Mich. 449, 455, and quoted approvingly in Walsh 
 V. Fisher, supra, "the party in default can never gain by his default, 
 and the other party can never be permitted to lose by it.'' Bishop v. 
 Price, 24 Wis. 480. The question, therefore, in such cases, is never 
 what vviir reasonably compensate the contractor, but what can the 
 purchaser pay without being put in worse position than if the contract 
 had been performed? The recovery is quantum valebat from the in- 
 nocent purchaser's point of view. 
 
 Proceeding to ascertain how far these principles are applicable to 
 the situation at bar, we are confronted by the fact that substantial 
 performance of the express contract is wholly wanting. The finding 
 is that the boiler furnished was about 82 per cent, of the capacity of 
 the old one, instead of ISO per cent., and that the increase of capacity 
 was the vital and essential part of the contract. This, is in no sense 
 substantial performance. The boiler does pot serve at all the purpose 
 which the larger one would "have served, and for which it was pur- 
 chased. Defendant can obtain that for which it contracted, and for 
 which it agreed to pay $2,035, and which is necessary to the purpose 
 which induced the contract, in only one of tw'o ways: either it can 
 remove this boiler from its premises at large expense, if plaintiff does 
 not remove it, and purchase and put in place another of the required 
 size ; or it can retain it, and put in another of substantially equal ca- 
 pacity as auxiliary to it, and at a cost equal to .or greater than the 
 original contract price, and probably necessitating reconstruction of 
 his boiler house. One in such predicament cannot be said to have,re>- 
 ceived in substance that for which he contracted. Malbon v. Birney, 
 supra ; Fuller, etc., Co. v. Shurts, supra. Neither do we discover ei- 
 ther finding or proof that defendant had accepted the boiler, had de- 
 cided to keep it, and use it so far as it will go toward supplying the 
 needed steam. True, the trial court argues that it would be inequitable 
 to allow defendant to keep the boiler and pay nothing fpr it, but does 
 not find that it has elected to do so. The only finding is that it is not 
 shown by a preponderance of the evidence that defendant rejected the 
 boiler, or demanded its removal, though he did protest that it did not 
 satisfy the contract. The evidence is that defendant never in- words 
 ordered plaintiff to remove the boiler, but from the testimony of the 
 same witness (plaintiff's manager) it appears that defendant, at the 
 time of protesting the insufficiency, did convey to defendant its wish ■ 
 and expectation that it be removed. That witness testified that Upon 
 such protest he agreed that he would remove the boiler if on test it did 
 not come up to contract requirement. The test was made, the capaci- 
 
Sec. 2) SUBSTANTIAL PERFORMANCE 653 
 
 ty ascertained, but the plaintiff's contention thereafter was that the 
 contract was other than it is now found to have been, and for that 
 reason did not remove it. This testimony fully confirms that of de- 
 fendant's manager that he desired to have the boiler removed, and, 
 negatives any inference that it remained on defendant's premises pur- 
 suant to an election on its part to keep it. * * * Doubtless the 
 fact, unexplained, that defendant made use of the boiler, which had 
 been built into its boiler house and connected with the steam pipes in 
 its factory, is an evidentiary circumstance having some tendency to 
 show acceptance, but such conduct is by no means conclusive when 
 a party cannot forego use of the appliance without at the same time 
 giving up the use of his own premises. * * * 
 
 The result is that at the close of the trial there was no evidence to 
 support a recovery on the contract, and the court should have render- 
 ed judgment dismissing the complaint. Neither was there evidence to 
 support a cause of action quantum meruit, to accord with which 
 amendment by the court is authorized by section 2830, Rev. St. 1898. 
 True, the court might conceive that acts subsequent to those disclosed 
 by the proofs might take place, and might constitute acceptance ; but 
 c&uld ihat justify an entire change of issues? The real controversy 
 had been as to the capacity of the boiler contracted for. That issue 
 being decided against it, different courses were open both to plaintiff 
 and defendant. The former might decide to take it away and replace 
 it by one up to the contract requirement, as it had promised to do; 
 or perhaps it might enlarge this particular boiler, as suggested by the 
 evidence ; or it might take it away entirely, and stand its liability for 
 damages for entire breach of the contract. The defendant might con- 
 sent to any of these steps, or it might resist them in such a way as to ef- 
 fectively work an acceptance so as. to be liable quantum meruit. In- 
 deed, so far as the record discloses, these options are still open to the 
 parties, if not foreclosed by the judgment appealed from. * * * 
 
 Judgment reversed, and cause remanded, with directions to enter 
 judgment dismissing the complaint."^ 
 
 '"^ In the following cases the court gave judgment for the defendant, for the 
 reason that the plaintiff's performance was not substantial performance: 
 Herdal v. Sheehy, 173 Cal. 163, 159 Pac. 422 (1916), building erected partly 
 on an adjoining street ; Tice v. Moore, 82 Conn. 244, 73 Atl. 133, 17 Ann. Cas. 
 113 (1909), plaintiff abandoned performance; Nance v. Patterson Bldg. Co., 
 140 Ky. 564, 131 S. W. 484, 140 Am. St. Rep. 398 (1910) ; Steel Storage 
 & Elevator Const. Co. v. Stock, 225 N. Y. 173, 121 N. E. 786 (1919), an 
 elevator v?hose capacity is 3,300 bushels per hour does not sul^stantially 
 fulfill a contract requiring a capacity of 4,000 bushels; Asbestolith Mfg. Co. 
 V. Kerley (Sup.) 129 N. Y. Supp. 512 (1911) ; Howard v. Albright, 129 App. 
 Div. 763, 114 N. Y. Supp. 194 (1909) ; Richardson v. Investment Co., 66 Or. 
 353, 133 Pac. 773 (1913) ; Moha v. Hudson Boxing Club, 164 Wis. 425, 160 
 N. W. 266 (1916), boxer struck foul blow in second round of ten-round contest^ 
 Manthey v. Stock, 133 Wis. 107, 113 N. W. 443 (1907), paint blistered and 
 put on over old paint. 
 
654 IMPLIED AND CONSTRUCTIVE CONDITIONS PEEOBDENT (Ch. 4 
 
 GILLESPIE TOOL CO. v. WILSON et al. 
 (Supreme Court of Pennsylvania, 1888. 123 Pa. 19, 16 Atl. 36.) 
 
 Action by the Gillespie Tool Company against R. J. Wilson and 
 George E. Tener, copartners under the style of Wilson & Tener, to 
 recover for boring a gas-well. The contract of the plaintiff company 
 was to put down and case a gas-well for the defendants, 2,000 feet 
 deep, — to be 8 inches in diameter for 400 feet, to shut off fresh water, 
 and below that; to the bottom, to be 5% inches in diameter. If salt wa- 
 ter was found below 400 feet, the 5%-inch casing to be drawn, and the 
 hole reamed out to 8 inches in diameter, to shut off salt water, then 
 5%-inch hole to the bottom. The well was put down the 2,000 feet, 
 but the diameter was not as specified in the contract. It was an 8-inch 
 hole to the depth of 940 feet; from that to 1,820 a 5%-inch hole; and 
 from that to the bottoip a 4%-inch hole. At the depth of 1,729 feet, 
 a salt rock was struck, nearly 100 feet in thickness. To shut off this 
 salt water and finish the well 5% inches in diameter, the casing from 
 940 to 1,820 feet would have to be drawn, and the hole reamed outV 
 to 8 inches in diameter. Instead of doing that; the plaintiff inserted 
 casing inside the 5%-inch casing, and this shut off the salt water, but 
 in consequence thereof could make the well below Only 4% inches in 
 diameter. 
 
 The court below grafted a nonsuit, and the plaintiff took, out a writ 
 of error, making the following assignments of error: "(1) The court, 
 below erred in entering judgment of compulsory nonsuit. (2) The 
 court below erred in refusing plaintiff's motion to take off nonsuit. 
 (3) The court below erred in rejecting plaintiff's offer of testimony 
 of J. M. Guffy and others, which, with the obj.ection thereto and ruling 
 of the court thereon, were as follows: 'By Plaintiff's Counsel: We 
 propose to ask Mr. Guffy, and other witnesses of similar practical ex- 
 perience in the same line, the following question : A test well is to be 
 drilled for oil or gas in undeveloped territory to a depth of 2,000 feet. 
 An 8-inch hole is drilled 940 feet deep, passing through the water-veins 
 usually found in the developed territory, and it is cased to that depth. 
 From that point it is drilled 5% inches in diameter, until it has reached 
 a depth of 1,729 feet from the surface, when salt-water veins, such 
 as are unusual in previously developed territory, are struck, and con- 
 tinue to be struck until the well has been drilled to a depth of 1,822 
 feet from the surface. It is then cased with 414-inch casing from 
 the surface down to the depth of 1,822 feet, where the salt-water veins 
 have all been passed. Assuming these facts, state whether or not sub- 
 stantially the same results would be reached in testing territory for 
 oil or gas as if the hole had been drilled 5% inches in diameter below 
 the depth of 1,822 feet. (Objected to as incompetent and irrelevant, 
 and, further, that the question assumes facts not shown to exist in 
 this case.) By the Court : The offer is to prove substantially that it is 
 
Sec. 2) SUBSTANTIAL PEEFOEMANCE 655 
 
 as good as if it had been bored out the required distance. The ques- 
 tion is not whether it will answer as well, but whether it is a substan- 
 tial fulfillment of the contract. Objection sustained. Exception and 
 bill sealed.' (4) The court below erred in rejecting plaintiff's further 
 offer of testimony of same witnesses, as follows : 'Assuming the facts 
 above stated, [as in third assignment of error,] state whether or not 
 it would be good operating in the drilling of a test well to drill the 
 remaining portion of the 2,000 feet with a 4-inch hit or auger. (Ob- 
 jected to as before. Objection sustained, and bill sealed.)' (5) The 
 court below erred in rejecting plaintiff's further offer of testimony 
 of same witnesses, as follows : 'Assuming the above facts [as in third 
 assignment of error] to be true, state whether or not, in case of ob- 
 taining gas, the same could be practically used as well from a 4%-inch 
 hole as from a 5%-inch hole. (Objected to as incompetent and irrele- 
 vant. Objection sustained.)' " 
 
 Stbrrett, J. Plaintiff company neither proved nor offered to prove 
 such facts as would have warranted the jury in finding substjihtial 
 performance of the contract enibodied in. the written propositions sub- 
 mitted to and accepted by the defendants. In several particulars the 
 work contracted for was not done according to the plain terms of the 
 contract. Nearly one-half of the well was not reamed out, as required, 
 to an 8-inch diameter, so as to admit 5%-inch casing in the clear. 
 About 180 feet qf the -lower section of the well, also, was bored 4 or 
 4% inches instead of 5% inches in diameter. In neither of these par- 
 ticulars, nor in any other respect, was there any serious difiiculty in 
 the way of completing the work in strict accordance with the terms 
 of the agreement. To have done so would have involved nothing 
 more than additional time and increased expense. The fact was pat- 
 ent, as well as proved by undisputed evidence, that a 4i/^-inch well 
 would not discharge as much gas as one 5% inches in diameter. It is 
 no answer to say that, for the purpose of testing the territory, a 4%- 
 inch well was as good as a 5%-inch well, nor that reaming out the 
 well to the width and depth required by the terms of the contract would 
 have subjected defendants to additional expense without any corre- 
 sponding benefit. That was their own affair. They contracted for the 
 boring of a well of specified depth, dimensions, etc., and. they had a 
 right to insist on at least a substantial performance of the contract 
 according to its terms. That was not done, and the court was clearly 
 right in refusing to submit the case to the jury on evidence that would 
 not have warranted them in finding substantial performance of the 
 contract. The equitable doctrine of substantial performance is intended 
 ■for the protection and relief of those who have faithfully and honestly 
 endeavored to perform their contract in all material and substantial 
 particulars, so that their right to compensation may not be forfeited 
 by reason of mere technical, inadvertent, or unimportant omissions 
 or defects. It is incumbent on him who invokes its protection to pre- 
 
656 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 sent a case in which there has been no willful omission or departure 
 from the terms of his contract. If he fails to do so, the question of 
 substantial performance should not be submitted to the jury. The of- 
 fers specified in the third, fourth, and fifth assignments were rightly 
 rejected. The proposed evidence was irrelevant and incompetent. 
 There is nothing In the second that requires a reversal of the judg- 
 ment. 
 Judgment affirmed."^ 
 
 JACOB & YOUNGS v. KENT. 
 
 (Court of Appeals of New York, 1921. 230 N. T. 239, 129 N. E. 889.) 
 
 Cardozo, J. The plaintiff built a country residence for the defend- 
 ant at a cost of upwards of $77,000, and now sues to recover a bal- 
 ance of $3,483.46, remaining unpaid. The work of construction ceased 
 in June, 1914, and the defendant then began to occupy the dwelling. 
 There was no complaint of defective performance until March, 1915. 
 One of the specifications for the plumbing work provides that "all 
 wrought-iron pipe must be well galvanized, lap welded pipe of the 
 grade known as 'standard pipe' of Reading manufacture." 
 
 The defendant learned in March, 1915, that some of the pipe, in- 
 stead of being made in Reading, was the product of other factories. 
 The plaintiff was accordingly directed by the architect to do the work 
 anew. The plumbing was then encased within the walls except in a 
 few places where it had to be exposed. Obedience to the order meant 
 more than the substitution of other pipe. It meant the demolition at 
 great expense of substantial parts of the completed structure. The 
 plaintiff left the work untouched, and asked for a certificate that the 
 final payment was due. Refusal of the certificate was followed by this 
 suit. 
 
 The evidence sustains a finding that the omission of the prescribed 
 brand of pipe was neither fraudulent nor willful. It was the result 
 of the oversight and inattention of the plaintiff's subcontractor. Read- 
 ing pipe is distinguished from Cohoes pipe and other brands only by the 
 name of the manufacturer stamped upon it at intervals of between six 
 and seven feet. Even the defendant's architect, though he inspected 
 the pipe upon arrival, failed to notice the discrepancy. The plaintiff 
 tried to show that the brands installed, though made by other manu- 
 facturers, were the same in quality, in appearance, in market value, 
 and in cost as the brand stated in the contract— ^that they were indeed, 
 
 »2 In accord: Connell v. Higgins, 170 Cal. 541, 150 Pac. 769 (1915) ; Peter- 
 son V. Pusey, 237 111. 204, 86 N. B. 692 (1008) ; Morgan v. Gamble, 230 Pa. 
 165, 79 Atl. 410 (1911) ; Van Clief v. Van Vechten, 130 N. Y. 571, 29 N. E. 
 1017 (1892) ; Spence v. Ham, 163 N. Y. 220, 57 N. E. 412, 51 L. R. A. 238 
 (1900) ; Elliott V. Caldwell, 43 Minn. 357, 45 N. W. 845, 9 L. R. A. 52 (1890) ; 
 Cornish Curtis & Greene Co. v. Antrim Co-op. Dairy Ass'n, 82 Minn. 215, 84 
 N. W. 724 (1901). 
 
Sec. 2) ' SUBSTANTIAL PERFORMANCE 657 
 
 the same thing, though manufactured in another place. The evidence 
 was excluded, and a verdict directed for the defendant. The Appellate 
 Division reversed, and granted a new trial. 
 
 We think the evidence, if admitted, would have supplied some basis 
 for the inference that the defect was insignificant in its relation to the 
 project. The courts never say that one who mattes a contract fills the 
 measure of 'his duty by less than full performance. They do say, how- 
 ever, that an omission, both trivial and innocent, will sometimes be 
 atoned for by allowance of the resulting damage, and will not always 
 be the breach of a condition to be followed by a forfeiture. Spence v. 
 Ham, 163 N. Y. 220, 57 N. E. 412, 51 L. R. A. 238; Woodward v. 
 Fuller, 80 N. Y. 31.2; Glacius v. Black, 67 N. Y. 563, 566; Bowen v. 
 Kimbell, 203 Mass. 364, 370, 89 N. E. 542, 133 Am. St. Rep. 302. The 
 distinction is akin to that between dependent and independent prom- 
 ises, or between promises and conditions. Anson on Contracts (Cor- 
 bin's Ed.) § 367 ; 2 Williston on Contracts, § 842. Some promises are 
 so plainly independent that they can never by fair construction be con- 
 ditions of one another. Rosenthal Paper Co. v. Nat. Folding Box & 
 Paper Co., 226 N. Y. 313, 123 N. E. 766; Bogardus v. N. Y. Life Ins. 
 Co., 101 N. Y. 328, 4 N. E. 522. Others are so plainly dependent that 
 they must always be conditions. Others, though dependent and thus 
 conditions when there is departure in point of substance, will be viewed 
 as independent and collateral when the departure is insignificant. 2 
 Williston on Contracts, §§ 841, 842; Eastern Forge Co. v. Corbin, 
 182 Mass. 590, 592, 66 N. E. 419 ; Robinson v. Mollett, L. R., 7 Eng. 
 & Ir. App. 802, 814; Miller v. Benjamin, 142 N. Y. 613, 37 N. E. 631. 
 Considerations partly of justice and partly of presumable intention 
 are to tell us whether this or that promise shall be placed in one class 
 or in another. The simple and the uniform will call for different rem- 
 edies from the multifarious and the intricate. The margin of departure 
 within the range of nfarmal expectation upon a sale of common chattels 
 will vary from the margin to be expected upon a contract for the con- 
 struction of a mansion or a "skyscraper." There will be harshness 
 sometimes and oppression in the implication of a condition when the 
 thing upon which labor has been expended is incapable of surrender 
 because united to the land, and equity and reason in the implication of a 
 like condition when the subject-matter, if defective, is in shape to be 
 returned. From the conclusion that promises, may not be treated as 
 dependent to the extent of their uttermost minutiae without a sacrifice 
 of justice, the progress is a short one to the conclusion that they may 
 not be so treated without a perversion of intention. Intention not oth- 
 erwise, revealed may be presumed to hold in contemplation the reason- 
 able and probable. If something else is in view, it must not be left to 
 implication. There will be no assumption of a purpose to visit venial 
 faults with oppressive retribution. 
 
 Those who thitik more of symmetry and logic in the development 
 Corbin Cont i2 
 
658 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 of legal rules than of practical adaptation to the attainment of a just 
 result will be troubled by a classification where the lines of division 
 are so wavering and blurred. Something, doubtless, may be said on 
 the score of consistency and certainty in favor of a stricter standard. 
 The courts have balanced such considerations against those of equity 
 and fairness, and found the latter to be the weightier. The decisions 
 in this state commit us to the liberal view, which is making its way, 
 nowadays, in jurisdictions slow to welcome it. Dakin & Co. v. L,ee, 
 1916, 1 K. B. 566, 579. Where the line is to be drawn between the 
 important and the trivial cannot be settled by a formula. "In the na- 
 ture of the case precise boundaries are impossible." 2 Williston on 
 Contracts, § 841. The same omission may take oh one aspect or an- 
 other according to its setting. Substitution of equivalents may not have 
 the same" significance in fields of art on the one side and in those of 
 mere utility on the other. Nowhere will change be tolerated, how- 
 ever, if it is so dominant or pervasive as in any real or substantial meas- 
 ure to frustrate the purpose of the contract. Crouch v. Gutmann, 134 
 N. Y..45, 51, 31 N. E. 271, 30 Am. St. Rep. 608. There is no general li- 
 cense to install whatever, in the builder's judgment, may be regarded as 
 "just as good." Easthampton L. & C. Co., Ltd., v. Worthington, 186 N. 
 Y. 407, 412, 79 N. E. 323. The question is one of degree, to be an- 
 swered, if there is doubt, by the triers of the facts (Crouch v. Gutmann; 
 Woodward v. Fuller, supra), and, if the inferences are certain, by the 
 judges of the law (Easthampton L. & C. Co., Ltd., v. Worthington, 
 supra). We must weigh the purpose to be served, the desire to be grat- 
 ified, the excuse for deviation from the letter, the cruelty of enforced 
 adherence. Then only can we tell whether literal fulfillment is to be 
 implied by law as a condition. This is not to say that the parties are 
 not free by apt and certain words to effectuate a purpose that per- 
 formance of every term shall be a condition of recovery. That question 
 is not here. This is merely to say that the law will be slow to impute 
 the purpose, in the silence of the parties, where the significance of the 
 default is grievously out of proportion to the oppression of the forfei- 
 ture. The willful transgressor must accept the penalty of his trans- 
 gression. Schultze V. Goodstein, 180 N. Y. 248, 251, 73 N. E. 21; 
 Desmond-Dunne Co. v. Friedman-Doscher Co., 162 N. Y. 486, 490, 56 
 N. E. 995. For him there is no occasion to mitigate the rigor of implied 
 conditions. The transgressor whose default is unintentional and trivial 
 may hope for mercy if he will offer atonement for his wrong. Spence 
 V. Ham, supra. 
 
 In the circumstances of this case, we think the measure of the al- 
 lowance is not the cost of replacement, which would be great, but the 
 difference in value, which would be either nominal or nothing. Some 
 of the exposed sectioas might perhaps have been replaced at moderate 
 expense. The defendant did not limit his demand to them, but treated 
 the plumbing as a unit to be corrected from cellar to roof. In point of 
 
Sec. 2) STJBSTANTUL PBEFORMANCE 659 
 
 fact, the plaintiff never reached the stage at which evidence of the ex- 
 tent of the allowance became necessary. The trial court had excluded 
 evidence that the defect was unsubstantial, and in view of that ruling 
 there was no occasion for the plaintiff to go farther with an offer of 
 proof. We think, however, that the offer, if it had been made, would 
 not of necessity have been defective because directed to difference in 
 value. It is true that in most cases the cost of replacement is the 
 measure. Spence v. Ham, supra. The owner is entitled to the money 
 which will permit him to complete, unless the cost of completion is 
 grossly and unfairly out of proportion to the ■ good to be attained. 
 When that is true, the measure is the difference in value. Specifica- 
 tions call, let iis say, for a foundation built of granite quarried in Ver- 
 mont. On the completion of the building, the owner learns that through 
 the blunder of a subcontractor part of the foundation has been built of 
 granite of the same quality quarried in New Hampshire. The measure 
 of allowance is not the cost of reconstruction. "There may be omis- 
 sions of that which could not afterwards be supplied exactly as called 
 for by the contract without taking down the building to its foundations, 
 and at the same time the omission may not affect the value of the build- 
 ing for use or otherwise, except so slightly as to be hardly appreciable." 
 Handy v. BHss, 204 Mass. 513, 519, 90 N. E. 864, 134 Am. St. Rep. 673. 
 Cf. Foeller v. Heintz, 137 Wis. 169, 178, 118 N. W. 543, 24 L. R. A. 
 (N. S.) 321 ; Oberlies v. BuUinger, 132 N. Y. 598, 601, 30 N. E. 999; 
 2 Williston on Contracts, §-805, p. 1541. The rule that gives a remedy 
 in cases of substantial performance with compensation for defects of 
 trivial or inappreciable importance has been developed by the courts 
 as an instrument of justice. The measure of the allowance must be 
 shaped to the same end. 
 
 The order should be affirmed, and judgment absolute directed in fa- 
 vor of the plaintiff upon the stipulation,, with costs in all courts.^* 
 
 ROWE V. GERRY et al. 
 
 (Supreme Court of New York, Appellate Division, 1906. 112 App. Div. 358, 
 
 98 N. Y. Supp; 380.) 
 
 Action by Edward Rowe against Isabel H. Gerry and others. From 
 a judgment for plaintiff, defendant Gerry appeals. Affirmed. 
 
 Per Curiam. This case has been here twice on appeal from judg- 
 ments for the plaintiff. 86 App. Div. 349, 83 N. Y. Supp. 740; 109 
 App. Div. 153, 95 ]Sr. Y. Supp. 857. The complaint was to recover the 
 final balance due on a building contract; i. e., it was for performance of 
 the contract. The first judgment was reversed for the reason that per- 
 
 »»Tlie dissenting opinion of Mcliaughlin, J., is omitted. Concurring 
 with Cardozo, J., were Hiscock, C. J., and Hogan and Crane, JJ. ; with Mc- 
 Laughlin, J., in his dissent were Pound and Andrews, J J. 
 
OCO IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 formance was, not shown by the plaintiff, but nonperformance, and ex- 
 cuse therefor, whereas a recovery could be had under the complaint 
 only for performance. The second judgment was affirmed, because sub- 
 stantial performance, which is performance, was shown and found by 
 the trial court. A reargument was ordered. 
 
 The learned counsel for the appellant understands that the second 
 judgment should have been reversed, because it was for substantial 
 performance, which he understands from our two former opinions 
 to be not performance, but nonperformance. We do not wish to 
 leave any such impression as that. There is a wide difference. Sub- 
 stantial performance is performance, and entitles the plaintiff to re- 
 cover under a complaint for performance; and especially is that so 
 under building contracts, where some of the infinite details may be 
 easily overlooked. Glacius v. Black, 50 N. Y. 145, 10 Am. Rep. 449; 
 Spence v. Ham, 163 N. Y. 220, 57 N. E. 412, 51 L. R. A. 238. It 
 may well even happen that the plaintiff may not know of existing 
 omissions when he draws his complaint for performance. When 
 such omissions are proved by the defendant, the plaintiff may re- 
 cover on his complaint for performance, if they be unsubstantial, 
 and not willful, but the cost of supplying them has to be deducted. 
 
 The judgment is affirmed. °* 
 
 "* Where the issue is the duty of the defendant to pay the agreed price, the 
 performance by the plaintiff is quite immaterial except so far as such per- 
 formance is a condition precedent to the duty. If the only condition is sub- 
 stantial (not full) performance, it is sufficient to allege this ; but it is also 
 proper to allege full performance for this means full performance of conditions 
 precedent. Omaha Water Co. v. Omaha, 156 Fed. 922, 926, 85 O. O. A. 54 
 (190T). 
 
 In Smith v. Mathews Constt Co., 179 Cal. 797, 179 Pac. 205, 207 (1919), 
 the court said: "Appellants insist that the deviations from the strict letter 
 of the contract (such, for example, as the failure in each room to carry the 
 "scratch coat" clear to the floor at that part of the wall subsequently con- 
 cealed by the baseboard) were intentional, willful violations of the agreement 
 necessarily involving bad faith, and that the doctrine of substantial per- 
 formance has no application. They also assert that such doctrine may only 
 be Invoked by pleading and where, as here, plaintiff alleged full performance 
 and the court found that there were any deviations, however slight, from 
 strict performance on the part of the lien claimant, the judgment must be 
 against him. In support of the point last stated, appellants cite such cases as 
 Herdal v. Sheehy, 173 Cal. 163, 159 Pac. 422 (1916), and Daley v. Russ, 86 
 Cal. 114, 24 Pac. 867 (1890), which hold, in effect, that where one seeks to 
 recover for the value of work done or material furnished in the partial per- 
 formance of a contract, full performance of which has been prevented by the 
 other party to the agreement, he must plead the excuse for failure of full 
 performance. Undoubtedly, if the omissions on the part of the plaintiff were 
 material and substantial failures to complete his contract, the pleading was 
 not sufficient to support a cause of action based upon the quantum meruit. 
 But the' court held that there was a substantial performance of the contract, 
 and the real question is whether or not that ruling was justified. It is not 
 true, as appellants contend, that any conscious deviation from the absolute 
 terms of the agreement causes a failure of performance." 
 
Sec. 2) CONDITION OF PERGONAL SATISFACTION 601 
 
 (h) Condition of Personal SATisifACTiON 
 
 GIBSON V. CRANAGE. 
 (Supreme Court of Michigan, 1878. 39 Mich. 49, 33 Am. Rep. 351.) 
 
 Marston, J. Plaintiff in error brought assumpsit to recover the 
 contract price for the making and execution of the portrait of ^the 
 deceased daughter of defendant. It appeared from the testimony of 
 the plaintiff that he at a certain time called upon the defendant and 
 solicited the privilege of making an enlarged picture of his deceased 
 daughter. He says : "I was to make an enlarged picture that he would 
 like, a large one from a small one, and one that he would like and 
 recognize a,s a good picture of his little girl, and he was to pay me." 
 
 The defendant testifies that the plaintiff was to take the small photo- 
 graph and send it away to be finished, "and when returned if it was 
 not perfectly satisfactory to me in every particular, I need not take 
 it or pay for it. I still objected and he urged me to do so. There was 
 no risk about it^ if it was not perfectly satisfactory to me I need not 
 take it or pay for it." 
 
 There was little if any dispute as to what the agreement was. Aft- 
 er the picture was finished it was shown to defendant who was dis- 
 satisfied with it and refused to accept it.. Plaintiff endeavored to 
 ascertain what the objections were, but says he was unable to ascertain 
 clearly, and he then sent the picture away to the artist to have it 
 changed. 
 
 On the next day he received a letter from the defendant , reciting 
 the original agreement, stating that the picture shown him the pre- 
 vious day was not satisfactory and that he declined to take it or any 
 other similar picture, and countermanded the order. A farther cor- 
 respondence was had, but it was not very material and did not change 
 the aspect of the case. When the picture was afterwards received by 
 the plaintiff from the artist, he went to see the defendant and to have 
 him examine it. This defendant declined- to do, or to look at it, and 
 did not until during the trial, when he examined and found the same 
 objections still existing. 
 
 We do not consider it necessary to examine the charge in detail, as 
 we are satisfied it was as favorable to plaintiff as the agreement would 
 warrant. 
 
 The contract (if it can be considered such) was an express one. The 
 plaintiff agreed that the picture when finished Should be satisfactory 
 to the defendant, and his own evidence showed that the contract in 
 this important particular had not been performed. It may be that 
 the picture was an excellent one and that the defendant ought to 
 have been satisfied with it and accepted it, but under the agreement 
 the defendant was the only person who had the right to decide this 
 question. Where parties thus deliberately enter into an agreement' 
 
662 IMPLIED AND CONSTBUCTIVB CONDITIONS PKEOEDBNT (Ch. 4 
 
 which violates no rule of public policy, and which is free from all 
 taint of fraud or mistake, there is no hardship whatever in holding 
 them bound by it. 
 
 Artists or third parties might consider a portrait an excellent one, 
 and. yet it prove very unsatisfactory to the person who had ordered it 
 and who might be unable to point out with clearness the defects or ob- 
 jections. And if the person giving the order stipulates that the por- 
 trait when finished must be satisfactory to him or else he will not accept 
 or pay for it, and this is agreed to, he may insist upon his right as 
 given him by the contract. McCarren v. McNulty, 7 Gray (Mass.) 
 141; Brown v. Foster, 113 Mass. 136, 18 Am. Rep. 463. 
 
 The judgment must be affirmed with costs. °^ 
 
 KENDALL V. WEST. 
 
 (Supreme Court of Illinois, 1902. 196 111. 221, 63 N. B. 683, 89 Am. 
 
 St. Rep. 317.) 
 
 Action by Ezra Kendall against William H. West.- From a judg- 
 ment of the appellate court (98 111. App. 116) affirming a judgment 
 for defendant, plaintiff appeals. Affirmed. 
 
 Hand, J. This is an action of assumpsit brought in the circuit court 
 of Cook county by the appellant against the appellee to recover dam- 
 ages in the sum of $10,000 for the breach of a contract in writing 
 whereby the appellee, a theatrical manager, engaged the appellant, a 
 specialist in monologue, to perform for appellee at such places and the- 
 aters in the United States and Canada as appellee might require, for the 
 theatrical season of 1898 and 1899; the season to begin on or about 
 August 15, 1898, and continue for not less than 30 weeks. Appellant 
 
 "5 In accord': Pennington v. Howland, 21 R. I. 65, 41 Atl. 891, 79 Am. St. 
 Rep. 774 (1898), portrait; Zaleski v. Clark, 44 Conn. 218,-26 Am. Rep. 446 
 (1876), bust; Brown v. Foster, 113 Mass. 136, 18 Am. Rep. 463 (1873), suit 
 of clothes; Koehler r. Buhl, 94 Mich. 496, 54 N. W. 157 (1893), personal 
 services ; Crawford v. Mail & Express Pub. Co., 163 N. T. 404, 57 N. B. 616 
 (1900), newspaper contributor; Bowen v. Btckner (Mo. App.) 183 S. W. 704 
 (1916), portrait; Clausen v. Vonnoh, 55 Misc. Rep. 220, 105 N. T. Supp. 102 
 (1907), portrait; Schwartz v. Cohn (Sup.) 129 N. Y. Supp. 464 (1911), suit; 
 Haehnel v. TrosUer, 54 Misc. Rep. 262, 104 N. Y. Supp. >533 (1907), woman's 
 coat; Aymar v. Bloomingdale (Sup.) 157 N. Y. Supp; 837 (1916), dental 
 work. 
 
 Where a contract is to be perfoiraied to the satisfaction of some third person, 
 more or less disinterested, the cases dealing with certificates of architects and 
 engineers are applicable. In such cases the courts are much more likely 
 (though not quite certain) to hold that personal satisfaction is a condition. 
 See Butler v. Tucker, 24 Wend. (N. Y.) 447 (1840) ; Webb & Co. v. Board 
 Trustees of Morganton Graded School Dist., 143 N. C. 299, 55 S. E. 719 
 (1906), contract to buy bonds "when legally issued to the satisfaction of our 
 attorney"; Church v. Shanklin, 95 Cal. 626, 30 Pac. 789, 17 L. R. A. 207 
 (1892), condition of perfecting title to land to the satisfaction of an attorney; 
 Giles V. Union Land Co. (Tex. Civ. App.) 196 S. W. 312 (1917) ; Grafton v. 
 Eastern Co. R. Co., 8 Exch. 699 (1853), coke to be supplied "to the satisfaction 
 of the railway company's inspecting oflScer." 
 
Sec. 2) CONDITION OF PERSONAL SATISFACTION 663 
 
 agreed to "render satisfactory services," and appellee agreed to pay for 
 "satisfactory services" the sum of $250 per week. Appellant entered 
 upon his engagement on August 15, and continued until November 5, 
 1898, when the contract was terminated by appellee. Appellant was 
 paid for his services in full up to and including November 5th. The 
 case was tried by the court and a jury. At the close of all the evidence 
 the court peremptorily instructed the jury to find for the defendant, and 
 a motion for a new trial having been overruled, and judgment rendered' 
 on the verdict, the af>pellant perfected an appeal to the appellate court 
 for the First district, where the judgment of the circuit court was 
 affirmed, and a further appeal has been prosecuted to this court. 
 
 The question presented for decision is, did the circuit court err in 
 taking the case from the jury? There was no conflict in the evidence, 
 and, the facts being admitted, it was the duty of the court to direct 
 the jury as to whether or, not such facts, in law, amounted to a legal 
 justification for the discharge of the appellant. The company man- 
 aged by appellee was a minstrel company. The appellant was re- 
 quested by appellee a number of times to shorten the time of his per- 
 formance, and to try his part in black face, with both of which requests 
 he positively declined to comply. Wood, in his work on Master and 
 Servant (section 119), says: "Refusing to obey the reasonable orders 
 of the master is a good ground for discharge from service, for in every 
 contract of hiring there is -an implied contract on the part of the serv- 
 ant that he will obey the lawful and reasonable commands of his mas- 
 ter." The appellee was the proprietor of the company, and had the 
 right to direct its management; and, if appellant refused to comply 
 with his reasonable request, the appellee had the right to discharge him. 
 We do not think the court erred in holding, as a matter of law, that 
 the request made of appellant to shorten the time of his performance, 
 and to try his part in black face, under the circuniistances shown by 
 the undisputed testimony, was not unreasonable, arbitrary, or capri- 
 cious, and that he was bound to comply therewith, and, upon a refusal 
 so to do, that the appellee had the right to discharge him and terminate 
 the contract. The contract of employment provided that appellant 
 should render "satisfactory services," for which he was to receive the 
 sum of $250 per week. It contained no provision in any manner limit- 
 ing the appellee in the exercise of his judgment as to what should be 
 deemed "satisfactory services." The appellant did not undertalce to 
 render services which should satisfy a. court or jury, but undertook to 
 satisfy the taste, fancy, interest, and judgment of appellee. It was the 
 appellee who was to be satisfied, and, if dissatisfied, he had the right to 
 discharge the appellant at any time for any reason, of which he was 
 the sole judge. Goodrich v. Van Nortwick, 43 111. 445 ; Crawford v. 
 Publishing Co., 163 N. Y. 404, 57 N. E. 616. In the Goodrich Case 
 the plaintiff purchased and paid for a fanning mill, with the agree- 
 ment that, if it did not suit him and answer his purpose, he might return 
 
064 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 it within 30 days. It was held that the mill must answer both require- 
 ments, and, if it did not suit the purchaser, he had the right to return 
 it and recover back the purchase price, and that he was the sole judge 
 of whether or not he was suited. In the Crawford Case the plaintiff 
 made a contract to write for the defendant's newspaper for two years, 
 provided his services should be satisfactory to the publisher; and it 
 was held that the defendant had the right to discharge the plaintiff 
 at any time if his services were unsatisfactory, of which fact the de- 
 fendant was the sole judge. 
 
 We find no reversible error in this record. The judgment of the 
 appellate court will therefore be affirrnedw Judgment afifirmed."' 
 
 BRIDGEFORD & CO. v. MEAGHER. 
 
 (Court of Appeals of Kentucky, 1911. 144 Ky. 479, 139 S. W. 750.) 
 
 Action by Louis L. Meagher against Bridgeford & Co. Judgment for 
 plaintiff, and defendant appeals. Affirmed. 
 
 Carroll, J. On December 21, 1908, the following contract was en- 
 tered into between the appellant, Bridgeford & Co., and the appellee, 
 Meagher: "This is to certify that the undersigned, Bridgeford & Co. 
 will guarantee Louis L. Meagher a steady position as foreman of our 
 molding shop, the same position he now holds, for a term of three years 
 or as long as he performs his duties in a successful or satisfactory 
 manner, provided Bridgeford & CO. are in existence, at a salary of not 
 less than twenty-two and °°/ioo dollars ($22.50) per week, payable 
 weekly, said Louis L. Meagher to give his entire time and attention 
 to the services of Bridgeford & Co. This co'ntract to take effect Jan- 
 uary 1st, 1909." At the time this contract was entered into, Bridge- 
 ford & Co. were and had been for many years engaged in the manu- 
 facture of stoves and structural iron work, and the appellee, a molder 
 by trade, had been working for ithem for some nine years, and for about 
 three years preceding the contract held the position of foreman of the 
 molding shop. On January 1, 1909.- he commenced work under the 
 contract and continued until the 22d of November, 1909, when he was 
 dischalrged. 
 
 In January, 1910, he instituted this action against appellant to re- 
 cover damages for its breach of the contract in discharging him. He 
 averred in his petition : That during the time he worked for it under 
 the contract "he gave his entire time and attention to the services of 
 defendant as required by said contract, and performed his duties in a 
 successful and satisfactory manner as said employe, and that defend- 
 ant has been in existence ever since the making of said contract, and still 
 is in existence. That plaintiff has at all times been, and still is, ready, 
 
 »« In accord: Schmand v. Jandorf, 175 Mich. 88, 140 N. W. 996, 44 L. R. 
 A. (N. S.) 680, Ann. Cas. 1915a, 746 (1913), services as skilled candy maker 
 for one year "to the satisfaction of" jandorf. 
 
Sec. 2) CONDITION OF PERSONAL SATISFACTION G(l5 
 
 willing, and able to perform his part of said contract, and did so per- 
 form it until his wrongful discharge as aforesaid, and since his said 
 discharge has at all times been ready, willing, and able to perform his 
 part of said contract, and has tendered and offered to do so, but defend- 
 ant, in violation of its contract, has refused and still refuses to permit 
 him to do so. Plaintiff says that by reason of said breach of contract 
 he was thrown out of employment and lost the opportunity to earn 
 the salary promised in said contract for the remainder of the term, to 
 wit, from November 22, 1909, to January 1, 1912, and that he has been 
 unable to obtain other employment, although he has diligently endeav- 
 ored to do so ; that by reason of said breach of contract plaintiff has 
 been damaged in the sum of $2,460." In its answer appellant, after 
 denying in a general way the averments of the petition, set up in one 
 paragraph that it did not undertake in the writing sued on to give ap- 
 pellee a position for three years, and in another paragraph it averred 
 that it discharged him -because he failed to perform his work in a 
 satisfactory or successful manner. Upon a trial before a jury a verdict 
 was returned in favor of appellee for $2,000, and from the judgment 
 entered upon this verdict it prosecutes this appeal. 
 
 The first error assigned by counsel is the failure of the lower court 
 to sustain a demurrer to the petition. [The reason given was that 
 the contract was void for want of mutuality; but the court held that 
 both made conditional promises for a three-year period and that neither 
 had the privilege of terminating performance.] * * * 
 
 Another groimd for reversal relied on is alleged error of the court in 
 giving to the jury the following instructions : 
 
 No. 1. [This instruction was to the effect that the discharge was 
 wrongful in case the jury believed that the plaintiff had performed his 
 work "in a good, efficient, and workmanlike manner."] 
 
 "No. 2. If you find for the plaintiff, you will award to him such 
 sum in damages as you believe from the evidence was the amount 
 lost by him by reason of being discharged from the service of the de- 
 fendant, and that means, gentlemen, you will find for him, the plain- 
 tiff', in the event you find for him at all, the full amotmt of his contract 
 wages from the time he was discharged until the period of employ- 
 ment terminated, by its date, to wit, January 1, 1912, which would 
 amount to $2,460, from which you will deduct such sum as you be- 
 lieve from the evidence the plaintiff has earned, and such sum, if any. 
 as you may believe from the evidence the plaintiff could by the exer- 
 cise of diligent efforts to secure employment have earned, and such 
 sum as you believe from the evidence the plaintiff will earn or by the 
 exercise of reasonable diligence to obtain employment can earn up to 
 the termination of the period of time covered by the contract, to wit, 
 January 1, 1912. Your verdict for the plaintiff, if you find for the 
 plaintiff, not to exceed the sum of $2,260. If you find for the defend- 
 ant, you -will say so by your verdict, and no more." 
 
 The objection urged to instruction No. 1 relates to the construction 
 
6G6 IMPLIED AND CONSTEUCTIVE CONDITIONS PKECEDBNT (Ch. 4 
 
 plaqed by the court upon the words, "in a successful or satisfactory 
 manner." It will be observed that the trial court instructed the jury 
 '?hat these words meant that appellee was "to perform his work as 
 foreman in a good, efficient, and workmanlike manner," and, if he did 
 so, it had no right to -dismiss him ; while it is the contention of coun- 
 sel for appellant that under the contract it was the sole judge as to 
 whether appellee performed his work in a successful or satisfactory 
 manner, and it had the right to determine in good faith this question 
 for itself, and to discharge appellee without reference to whether the 
 service rendered by him was efficient and workmanlike or not. There 
 is a line of cases holding that, where the master reserves the right to 
 discharge the servant if his services are not "satisfactory," he may do 
 so without any other cause or reason than the mere fact that he is not 
 satisfied with him or his service. Other cases hold that under such a 
 contract the master in discharging the servant before the term ends 
 must in good faith be dissatisfied, and that, if he is in good faith dis- 
 satisfied with the services of the employe, he may discharge him before 
 the contract term has expired, although, in fact, no valid ground for 
 the discharge exists. In the note to Corgan v. George F. Lee Coal 
 Company, 218 Pa. 386, 67 Atl. 655, 120 Am. St. Rep. 891, reported in 
 11 Ann. Cas. 841, the authorities upon this question are collected, and 
 a number of cases cited holding in the language of the editor of the 
 note that : "Under a contract of employment for a definite term, pro- 
 vided the duties of the employment are satisfactorily performed, the 
 services must be performed by the employe to the satisfaction of the 
 employer, and the employer has the absolute right whenever he be- 
 comes in good faith dissatisfied with the services of the employe to 
 discharge him." 
 
 But in nearly all of the cases where the right of the employer to dis- 
 charge the employe if his services are not satisfactory is recognized 
 the contracts of employment expressly and unconditionally conferred 
 upon the employer this power, and there was no language in the con- 
 tracts limiting this arbitrary authority or manifesting a purpose -to 
 protect the employe during the term, if he was capable and trust- 
 worthy, and performed his duties in an efficient and workmanlike 
 manner.''^ And, if this contract read that appellant reserved the right 
 to discharge appellee whenever his services were not satisfactory to it, 
 or when he did not give satisfaction, there could be found ample au- 
 thority to support the proposition that appellant might have discharg- 
 ed appellee before the expiration of the term if it was not in good 
 faith satisfied with the manner in which he performed his duties, 
 although he may have discharged them in an efficient or workmanUke 
 manner. Wood on Master & Servant (2d Ed.) § 109; Koehler v. 
 Buhl, 94 Mich. 496, 54 N. W. 157. But this rule, although well estab- 
 lished and supported by the great weight of authority, ought not to 
 
 »' Observe the use of the terms "right," "power," and "authority." 
 
Sec. 2) CONDITION OF PERSONAL SATISFACTION 667 
 
 be extended to embrace contracts tliat do not fall strictly within its 
 scope. 
 
 And, as this contract may by its terms be taken out of the class to 
 which other contracts giving to the employer the right to discharge 
 without cause belong, we^ are not disposed to hold it applicElble. 
 When it ijvas entered into, appellee was holding the same position 
 guaranteed to him by the contract. He had informed the appellant 
 that, as it was about to convert its establishment into a nonunion 
 plant, he could not remain in its employment unless some satisfactory 
 arrangement was made by which he would be insured permanent em- 
 plo>Tment. Following this declaration of appellee, and as an induce- 
 ment for him to remain in its employment, it prepared the contract 
 in question. It will be observed that this contract stipulates that it is 
 to continue in force "for the term of three years or as long as he per- 
 forms his duties in a successful or satisfactory manner, provided 
 Bridgeford & Co. are in existence," showing that it was intended by 
 appellant to retain appellee in its service for as long as three years if 
 he performed his duties in a successful or satisfactory manner, and it 
 remained in business. Unless this ' was the intention of the parties, 
 there was no reason for inserting in the contract that it should termi- 
 nate before the expiration of three years if Bridgeford & Co. went out 
 of existence. If it had the right to discharge appellee at any time his 
 services were not satisfactory, it had the right to do so whether it went 
 out of existence or not ; and it is manifest that the words, "provided 
 Bridgeford & Co. are in existence," were inserted in the contract to 
 protect it from loss, in the event it went out of existence before the 
 expiration of three years, and while appellee was performing his sei^v- 
 ices in a successful, or efficient and workmanlike manner. 
 
 The situation of the parties at the time it was entered into may also 
 be looked to in arriving at their intention as expressed in the contract, 
 and, when the conditions surrounding them are, considered, it is mani- 
 fest that it was not contemplated by either that one might arbitrarily 
 and without good cause terminate the contract. Appellee wanted his 
 position secured for a definite term, and appellant desired his services 
 for a certain period, and with these mutual purposes in view the con- 
 tract was entered into. To allow appellant to terminate at its pleasure 
 a contract made under these circumstances would do violence to the 
 intention of the parties when it was executed, and to the language em- 
 ployed to express their engagement. Having this view as to the prop- 
 er construction of the contract, we think the trial court correctly in- 
 structed the jury. 
 
 The objection urged. to instruction No. 2 is that it permitted the 
 jury to award appellee damages which might accrue after the time of 
 the trial which took place in November, 1910, more than 13 months 
 before January 1, 1912, at which date the three years expired."^ 
 
 *s The part of the opinion subsequent hereto should be studied again later 
 in connection with Schell v. Plumb and following cases, post, p. 784. 
 
668 IMPLIED AND CONSTEUCTIVB CONDITIONS PEECEDENT (Ch. 4 
 
 It is the settled law in this state, and has been so ruled by virtually 
 all the courts, that in actions like this there can be only one recovery, 
 and that one must include all past as well as future damage that has 
 been or may be sustained by reason of the breach of contract on the 
 panrt of the employer. The action to recover this damage may be 
 brought as soon as the contract is brokeA, or at any time before the 
 expiration of the term for which the employment was made, -or the 
 employe may, if he so elects, wait until the ^nd of the term; but, 
 whenever he brings the suit, he must in that suit recover all of his 
 damage past and future growing out of the breach of the contract. 
 
 It is also the general rule that the measure of damage is the differ- 
 ence between the contract price and any sum earned by, or that by the 
 exercise of reasonable diligence could have been earned by, the em- 
 ploye after his discharge. To illustrate: If under the contract ther 
 employe was to receive $100 a month, and immediately after his dis- 
 charge he obtained employment that paid him $50 a month, the 
 measure of his damage, assuming that he had a right to recover, 
 would be $50 a month, and this would be all that he could recover, al- 
 though he was not actually employed at $50 a month, provided it ap- 
 peared that he could by the exercise of reasonable diligence have pro- 
 cured employment that would have paid him this sum. So that, if the 
 trial should take place after the expiration of the contract, there would 
 not be much difficulty in determining by the application of this rule 
 the amount of damage to which the injured employe was entitled; but, 
 if the trial is had before the contract expires, it is apparent that the 
 sum he would earn or that he might earn by the exercise of reasonable 
 diligence between the date of the trial and the expiration of the contract 
 is necessarily involved in great uncertainty, and this has induced some 
 courts to reject the right to recover any damages after the date of 
 the trial if it takes place before the expiration of the contract. Mc- 
 Mullan V. Dickinson, 60 Minn. 156, 62 N. W. 120, 27 L. R. A. 409, 
 51 Am. St. Rep. 511. 
 
 But the great weight of authority supports the rule prevailing in 
 this state, that the action may be brought before the expiration of 
 the term; and, if it is, damages may be' recovered in this action for 
 loss that will be sustained for the whole of the term, although the 
 trial may be had before the term expires. In Pierce v. Tenn., etc.. 
 Coal Co., 173 U. S. 1, 19 Sup. Ct. 335, 43 L. Ed. 591, the Supreme 
 Court of the United States, in considering this question said: "The 
 defendant committed an absolute breach of the contract at a time 
 when the plaintiff was entitled to require performance. The plain- 
 tiff was not bound to wait to _see if the defendant would change 
 its decision and take him back into its service, or to resort to suc- 
 cessive actions for damages from time to time, or to leave the whole 
 of his damages to be recovered by his personal representative aft- 
 er his death. But he had the right to elect to treat the contract as 
 absolutely and finally broken by the defendant; to maintain this ac- 
 
, Sec. 2) CONDITION OF PERSONAL SATISFACTION 660 
 
 tion once for all, as for a total breach of the entire contract; and to 
 recover all that he would have received in the future as well as in the 
 past if the contract had been kept. In so doing he would simply re- 
 cover the value of the contract to him at the time of a breach, includ- 
 ing all the damages past or future resulting from the total breach of 
 the contract. The difficulty and uncertainty of estimating damages 
 that the plaintiff may suffer in the future is no greater in this action 
 of contract than they would have been if he had sued the defendant 
 in an action of tort to recover damages for personal injuries sustained 
 in its service, instead of settling and releasing those damages by the 
 contract now sued on." T,he same rule was announced in John C. 
 Lewis Co. v. Scott, 95 Ky. 484, 26 S. W. 192, 16 Ky. Law Rep. 49, 
 44 Am. St. Rep. 251; Forked Deer Pants Co. v. Shipley, 80 S. W. 
 476, 25 Ky. Law Rep. 2299; Keedy v. Long, 71 Md. 385, 18 Atl. 
 704, 5 L. R. A. 759; Hamilton v. Love, 152 Ind. 641, 53 N. E. 181, 
 54 N. E. 437, 71 Am. St. Rep. 384; Smith v. Cashie, etc., Co., 142 
 N. C. 26, 54 S. E. 788, 5 L. R. A. (N. S.) 439; Howard v. Daly, 61 
 N. Y. 362, 19 Am. Rep. 285; Howay v. Going, etc., Co., 24 Wash. 
 88, 64 Pac. 135, 6 L. R. A. (N. S.) 49, 85 Am. St. Rep. 942. 
 
 It is further, argued that the averments of the petition are not suf- 
 ficient to authorize any recovery after the time of the trial. In sup- 
 port of this, attention is called to Lewis & Co. v. Scott, supra, in 
 which the court said : "If it was to be a part of her damages that she 
 remained out of employment after seeking it, it was incumbent on her 
 to allege the fact, and, if because she brought her suit before the ex- 
 piration of the contemplated term of service she could not fix the 
 damage or loss with certainty, this was a burden she voluntarily as- 
 sumed by bringing the suit when she did. She must lay the basis as 
 best she may upon which the jury may assess her damages. It would 
 be an approximation, but is pemaissible, and is the most that could be 
 required of her, and the best she could do unless she waited until the 
 year was out." As the plaintiff under the ntle prevailing in this state 
 in actions like this is required to aver and prove that he was unable 
 to obtain other employment, if such be the case, it is manifest that it 
 would be practically impossible for the plaintiff to truthfully aver or 
 state that he could not obtain employment after the trial, as he could 
 not with any degree of certainty declare in advance whether he could 
 obtain employment or not, or what compensation he would derive 
 from employment if he succeeded in obtaining it, and therefore it is 
 argued that no damages should be allowed after the trial. 
 
 Viewing the matter from a 'logical standpoint, there is much force 
 in this contention; but, as practically all the authorities agree that 
 only one action can be brought and this may be brought and tried 
 before the end of the term, it follows that, if this practice is to be 
 adhered to, the damages subsequent to the trial must be estimated as 
 best they can, for, when the law points out the method by which an 
 injured person may obtain redress, it should not impose conditions 
 
670 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 that would deny him the right to secure the redress to which it has 
 said he was entitled; and so all that the plaintiff in cases like this 
 should be required to do is to state in his petition, as did the appellee, 
 that he had been unable to obtain other employment, although he 
 had diligently endeavored to do so, and to show by evidence what 
 he earned and what efforts he made to get employment up to the 
 trial, leaving it to the jury to determine from the evidence what em- 
 ployment the plaintiff may obtain and how much he can earn be- 
 tween the time of the trial and the termination of the contract. Of 
 course, in arriving at what should be allowed for damages after 
 the trial, the jury can only be guided by the evidence of conditions 
 that existed before and at the time of the trial and from these de- 
 termine the amount to be awarded. It would not be fair to the 
 plaintiff to assume in the absence of evidence to that effect that he 
 will not be damaged subsequent to the trial or to assume that he can 
 and will obtain employment through which he can earn more than the 
 contract price, and if there is uncertainty or doubt about this part of 
 the recovery, the person who incurred the responsibility by commit- 
 ting the breach of the contract should bear the burden of any injus- 
 tice that may result. And so we are of the opinion that the petition 
 was sufficient, and that the instruction conformed to the law as it is ad- 
 ministered in this class of cases. 
 
 Another ground for reversal is that the evidence does not support 
 the verdict, and that tlie recovery is excessive. We have carefully read 
 the record, and our conclusion without going into details is that ap- 
 pellee at all times performed his duties in a good, efficient, and work- 
 manlike manner, and that his discharge was not justified by any fail- 
 ure upon his part to discharge in such a manner his part of the con- 
 tract. ' Probably the assessment was slightly more than it should have 
 been, but we are not prepared to say that it was so excessive as to 
 justify us in interfering with the finding of the jury. We have no- 
 ticed all the material grounds for reversal pointed out by counsel, and 
 upon the whole case find no reversible error. 
 
 Wherefore the judgment is affirmed. 
 
 GERISCH V. HEROLD. 
 
 (Court of Errors and Appeals of New Jersey, 1912. 82 N. J. Law, 605, 83 
 Atl. 892, Ann. Gas. 1913D, 627.) 
 
 Action by John C. Gerisch against Rudolph Herold. Judgment for 
 plaintiff (81 N. J. Law, 171, 79 Atl. 1028), and' defendant brings 
 error. Reversed, and venire de novo awarded. 
 
 The plaintiff agreed to erect and finish a house in a good workman- 
 like and substantial manner under the direction of Joseph Turck, archi- 
 tect, to be testified by a writing or certificate under the hand of Turck, 
 and also to find and provide good, proper, and sufficient materials for 
 
Sec. 2) CONDITION OF PERSONAL SATISFACTION 671 
 
 completing and finishing all the work. The defendant agreed to, pay 
 for the same in four payments, the last of which, $3,000, was to be 
 made when all the work was completed according to the plans and 
 specifications to the satisfaction of the owner or his representative. The 
 contract also provided in the ordinary form that, should any dispute 
 arise respecting the true construction or meaning of the drawings 
 or specifications, it should be decided by Joseph Turck, and his decision 
 should be final and conclusive. This suit is for the last payment. One 
 plea averred that the plaintiff did not complete all the work to the 
 satisfaction of the owrfer or his representative. The replication to the 
 plea averred that the owner fraudulently withheld his satisfaction, and 
 on this issue was joined. This issue was not submitted to the jury, 
 and the defendant did not request its submission. He relied upon a 
 motion to nonsuit for failure of the plaintiff to prove that the work 
 was done to the satisfaction of the owner or his representative. The 
 architect had Certified that the plaintiff was entitled to the payment of 
 $3,000 by the terms of the contract. 
 
 SwAYZE, J. (after stating the facts as above). Contracts requiring 
 the work to be satisfactory to the employer are valid. Gwyime v. 
 Hitchner, 66 N. J. Law, 97, 48 Atl. 571. This decision has been ap- 
 proved in this court in a suit involving the same contract. Gwynne v. 
 Hitchner, 66 N. J. Law, 97, 48 Atl. 571. A distinction is sometimes 
 made between cases where the fancy, taste, sensibility, or judgment of 
 the promisor are involved, and cases where only operative fitness or 
 mechanical utility is involved. 9 Cyc. 618, ff. Gwynne v. Hitchner was 
 a case of the former class, and, although the case of a building con- 
 tract is somewhat different, we see no reason to doubt that the mere 
 taste or fancy of the owner may be an important element in a dwelling 
 house at least. The Supreme Court has applied the rule to that situa- 
 tion, and we do not question the soundness of its decision. Welch v. 
 Hubschmitt Co.^ 61 N. J. Law, 57, 38 Atl. 824. In the present case the 
 parties made a clear distinction between the workmanship and the 
 materials. The character of the former was to be testified to by 
 Turck's certificate. The only provision as to the latter is that they 
 should be good, proper, and sufficient for completing the work. The 
 workmanship might well be left to the judgment of another while 
 the owner to gratify his own taste might well desire to retain control 
 of the latter himself. 
 
 No doubt it is true, as Justice Holmes said in Hawkins v. Graham, 
 149 Mass. 284, 21 N. E. 312, 14 Am. St. Rep. 422: "When the consid- 
 eration furnished is of such a nature that its value will be lost to the 
 plaintiff either wholly or in great part unless paid for, a just hesita- 
 tion must be felt, and clear language required before deciding that pay- 
 ment is left to the will, or even to the idiosyncrasies of the interested 
 party." The court in that case seized upon the words, "or the work 
 demonstrated," as offering an alternativ.e to the owner's acknowledg- 
 
672 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 nietit. In a later case the same court drew a distinction between cases 
 in which the decision of a particular person is referred to, and a case 
 where machinery was guaranteed to work in a satisfactory manner, 
 and held that the latter case involved a "result to be passed upon in 
 a reasonable way in accordance with a standard stated in words." 
 Lockwood Mfg. Co. v. Mason Regulator Co., 183 Mass. 25, 66 N. E. 
 420. The present case is one where the decision of a particular per- 
 son (the owner or his representative) is referred to, a class of cases in 
 which the Maissachusetts courts recognize that the dissatisfaction of 
 the promisor need not be a reasonable dissatisfaction to bar recovery 
 by the promisee. The decision of the New York Court of Appeals 
 seems to be to the contrary. Doll v. Noble, 116 N. Y. 230, 22 N. E. 
 406, 5 L.R. A. 554, IS Am. St. Rep. 398. The case is entitled to less 
 weight for the reason that the learned judge failed to distinguish be- 
 tween a case where the owner withheld satisfaction unreasonably and 
 one where he withheld it in bad faith. All the cases recognize that the 
 owner must act in good faith. The reasoning of Chief Justice Beasley 
 in Chism v. Schipper, 51 N. J. Law, 1, 16 Atl. 316, 2 L. R. A. 544, 14 
 Am. St. Rep. 668, applies with greater force to such a case as the 
 present, where it is the Owner himself who is to be satisfied. Of course, 
 he cannot avail himself of his own fraud to escape liability on his 
 contract. 
 
 The motion to nonsuit would have been properly denied if there was 
 evidence of bad faith on the part of the owner. We are not called upon 
 to decide whether the jury in a proper case might be permitted to 
 infer fraud from the fact that the owner was not satisfied with the 
 architect's certificate. The case was not tried on that theory. If it 
 had 'been, the defendants should have been allowed to ask the ques- 
 tion of the plaintiff that was excluded — whether Turck did not tell 
 him at the time he received the certificate that he (Turck) had been 
 discharged as architect. Not only was the case not tried on the theory 
 that the owner acted in bad faith, but no inference of bad faith could 
 be drawn from his refusal to be satisfied by the architect's certificate, 
 since by the terms of the contract that certificate covered only the ex- 
 ecution of the contract in a good workmanlike and substantial manner, 
 and the plaintiff specifically contracted to furnish good, proper, and 
 sufficient materials to complete the work, with no provision authoriz- 
 ing or requiring the architect to certify whether he had in fact done so 
 or not. The distinction is pointed out by Justice Fort in Newark v. 
 New Jersey Asphalt Co., 68 N. J. Law, 458, 463, 53 Atl. 294. The 
 contract, it is true, made the architect's decision final as to some things, 
 but it was only as to the true construction or meaning of the drawings 
 or specifications. The learned trial judge fell into error in thinking 
 that the architect's certificate covered, not only these points, but also the 
 question whether the payment was due. His charge as to the finality 
 of the architect's certificate would have been correct if he had limited 
 
Sec. 2) 60NDITION OF PBESONAL SATISFACTION 673 
 
 it to the points to which the parties limited it by their contract. They 
 contracted that the final payment should be due when all the work was 
 completed according to the plans and specifications to the satisfaction 
 of the owner or his rapresentative provided that in case of each pay- 
 ment a certificate should be obtained and signed by Turck. Thus they 
 made for the final payment a double condition (1) a certificate by the 
 architect ; (2) satisfaction of the owner or his representative. 
 
 The case differs from Welch v. Hubschmitt Co. because in that case 
 satisfaction of the owner and architect was required; here only that of 
 the owner or his representative. The question remains whether Turck 
 was the representative of the owner. Our reason for thinking he was 
 not is threefold. (1) It was unnecessary to require his certificate for 
 the final payment if the payment was to be made upon his being satis- 
 fied. By requiring satisfaction of the owner or his representative in one 
 clause and a certificate from Turck in a proviso immediately following, 
 the parties seem to have had two different persons in view. (2) Turck 
 had already been designated as the architect, and the word "architect" 
 would have been more natural in this clause than the word "representa- 
 tive" if he had been meant. (3) He was made by the contract the jiidge 
 between the parties as to the most important portions of the contract, 
 which were likely to lead to controversy between builder and owner. 
 To have made him the representative of the owner would have deprived 
 him of the judicial position in which the parties meant him to stand, 
 and thereby have deprived his certificate of that conclusive character 
 against the builder which was given to it by the express terms of the 
 contract. 
 
 We think for these reasons that there was error, and that the judg- 
 ment must be reversed that a venire de novo may be awarded.'" 
 
 "9 In accord: Adams Radiator & Boiler Works v. Schnader, 155 Pa. 394, 
 26 Atl. 745, 35 Am. St. Rep. 893 (1893), steam lieating apparatus— "We 
 guarantee this apparatus to give entire satisfaction in its operation, and, 
 should it prove unsatisfactory after a thorough and reasonable trial, we will 
 remove it at our expense" ; Hawken v. Daley, 85 Conn. 16, 81 Atl. 1053 (1911), 
 building contract; Barnett v. Beggs, 208 Fed. 255, 125 C. C. A. 455 (1913), 
 house plans to be drawn by architect ; Singerly v. Thayer, 108 Pa. 291, 2 Atl. 
 230, 56 Am. Rep. 207 (1885), elevator to be installed warranted to be satis- 
 factory; Morgan v. Gamble, 230 Pa. 165, 79 Atl. 410 (1911), building con- 
 tract; Jones V. Lanier, 198 Ala. 363, 73 South. 535 (1916), coal to be supplied. 
 
 This is the general rule where merchandise is bought with the privilege 
 of return: Campbell Printing Press Co. v. Thorp (C. C.) 36 Fed. 414, 1 L. R. 
 A. 645 (18&S), printing press ; Wood, Reap. & M. M. Co. v. Smith, 50 Mich. 565, 
 15 N. W. 906, 45 Am. Rep. 57 (1883), harvesting machine; Goodrich v. Van 
 Nortwick, 43 lU. 445 (1867), fanning mill; Aiken v. Hyde, 99 Mass. 183 
 (1868), gas generator; Exhaust Ventilator Co. v. Chicago, M. & St. P. R. Co., 
 66 Wis. 218, 28 N. W. 343,. 57 Am. Rep. 257 (1886), exhaust fans. 
 
 The same is true of all "option" contracts, a power being intentionally 
 created that is to be exercised according to the will and desire of the holder. 
 Thus vendors often promise to repurchase if the buyer becomes dissatisfied. 
 Parker v. Beach, 176 Cal. 172, 167 Pac. 871 (1917) ; Hills v. Hopp, 287 111. 
 S75, 122 N. E. 510 (1919). And see Anvil Min. Co. v. Humble, i53 U. S. 540, 
 
 CORBIN CONT 43 
 
674 IMPLIED AND CONSTEUCTIVB CONDITIONS PRECEDENT (Ch. 4 
 
 WILLIAMS MFG. CO, v. STANDARD BRASS CO. 
 (Supreme Judicial Court of Massacliusetts, 1899. 173 Mass. 356, 53 N. E. 862.) 
 
 Action by the Williams Manufacturing Company against the Stand- 
 ard Brass Company. There was a judgment in favor of plaintiff, and 
 defendant brings exceptions. Sustained. 
 
 HoivMits, J. This is an action upon a contract under which the plain- 
 tiff constructed an equipment for melting brass for the defendant. The 
 contract was in writing. By one clause of it the plaintiff agrees "to 
 place the above-named outfit in operation for sixty days' trial for the 
 approval of the- second party, and if the results obtained after the trial 
 are in accordance with the specifications above, and satisfactory to 
 the second party, the second party further agrees to pay for the above- 
 named equipment the' sum of $550." Upon the findings of the jury, 
 it must be taken that the work was done in accordance with the spec- 
 ifications of the contract, and in such a way as to be satisfactory to a 
 reasonable man. The defendant, however, was not satisfied, and stop- 
 ped the experiment before the 60 days had elapsed. 
 
 The questions raised by the exceptions are whether the defendant's 
 liability was conditioned upon actual satisfaction, even if the dissatis- 
 faction was unreasonable, so long as it really was felt, and, perhaps, 
 whether the defendant was bound to let the experiments continue for 
 60 days. We are of opinion that the defendant did not lose its right to 
 insist upon its fundamental defense by the course of the trial. We 
 are of opinion, also, with some slight hesitation on my part, that the 
 defendant's liability was conditioned as above suggested, and that bona 
 fide, even if unreasonable, dissatisfaction of the defendant is an answer 
 to the plaintiff's claim. The plaintiff undertakes to put in the work 
 "for the approval of the" defendant, and the defendant undertakes to 
 pay only if the results are in accordance with the specifications "and 
 satisfactory" to it. The exceptions state the substance of the evidence, 
 but it does not appear to be material, except so far as it shows that 
 putting in the proposed equipment involved a considerable change in 
 the defendant's business, and that it seems to have been regarded as 
 more or less of an experiment, which facts confirm and give a reason 
 for the interpretation which w« adopt. Furthermore, the contract does 
 not provide a test alternative to satisfaction, as was the case in Hawkins 
 V. Graham, 149 Mass. 284,-21 N. E. 312, 14 Am. St. Rep. 422, where 
 the money was to be paid after acknowledgment of satisfaction by the 
 defendant "or the work demonstrated." It almost follows .from our 
 interpretation that, as soon as the defendant was convinced that the 
 
 14 Sup. Ct. 876, 38 L. Ed. 814 (1894), option to terminate an agreed system 
 of mining at will. 
 
 See, also, Goldberg v. Feldman, 108 Md. 330, 70 Atl. 245 (1908), promise to 
 buy land if the deed contained a satisfactory covenant against the sale of 
 liquors. 
 
Sec. 2) CONDITION OF PERSONAL SATISFACTION 675 
 
 work was unsatisfactory, it had a right to stop it. The provision for 
 60 days' trial was an undertaking of the plaintiff for the defendant's 
 advantage, to insure it whatever knowledge it wanted in order to decide. 
 
 We have assumed without discussion that the defendant was bound 
 to good faith in deciding and in expressing its decision, and that such an 
 arrangement limited its absolute freedom to do as it chose sufficiently 
 to be entitled to the name of a contract. 
 
 Exceptions sustained. 
 
 DUPLEX SAFETY BOILER CO. v. GARDEN. 
 
 (Court of Appeals of New York, 1886. 101 N. Y. 387, 4 N. E. 749, 54 
 
 Am. Rep. 709.) 
 
 DanForTh, J. The plaintiff sued to recover $700, the agreed price, 
 as it alleged, for materials furnished and work done for the defendants, 
 at their request, upon certain boilers belonging to them. The defense 
 set up was that the work was done under a' written contract for the al- 
 teration of the boilers, and to be paid for only when the defendants 
 "were satisfied that the boilers, as changed, were a success." Upo» 
 the trial it appeared that the agreement between the parties was con- 
 tained in letters, by the first of which the defendants said to plain- 
 tiff: 
 
 "You may alter our boilefs, changing all the old sections for your 
 new pattern, changing our fire front, raising both boilers enough to 
 give ample fire space; you doing all disconnecting and connecting, 
 also all necessary mason work, and turning boilers over to us ready 
 to steam up. . Work to be done by tenth of May next. For above 
 changes we are to pay you seven hundred dollars as soon as we are 
 satisfied that the boilers, as changed, are a success, and will not leak 
 under a pressure of 100 pounds of steam." 
 
 The plaintiff answered, "accepting the proposition," and as the evi- 
 dence tended to- show, and as the jury has found, completed the re- 
 quired work in all particulars by the tenth of May 1881, at which time 
 the defendants began and thereafter continued tlae use of .the boilers. 
 
 The contention on the part of the appellant is that the plaintiff was 
 entitled to no compensation, unless the defendants "were satisfied that 
 the boilers, as repaired, were a success, and that this question was for 
 the defendants alone to determine;" thus' making their obligation de- 
 pend upon the mental condition of the defendants, which they alone 
 could disclose. Performance must, of course, accord with the terms 
 of the contract; but if the defendants are at liberty to determine for 
 themselves when they are satisfied, there would be no obligation, and 
 consequently no agreement which could be enforced. It cannot be pre- 
 sumed that the plaintiff entered upon its work with this understanding, 
 nor that the defendants supposed they were to be the sole judge in 
 their own cause. On the contrary, not only does the law presume that 
 
676 IMPLIED AND CONSTKUCTIVB CONDITIONS PRECEDENT (Ch. 4 
 
 for services rendered remuneration shall be paid, but here the parties 
 have so agreed. The amount and manner of compensation are fixed ; 
 time of payment is alone uncertain. The boilers were changed. Were 
 they, as changed, satisfactory to the defendants? In Folliard v. Wal- 
 lace, 2 Johns, 395, W. covenanted that, in case the title to a lot of 
 land conveyed to him by F. should prove good and sufficifent in law 
 against all other claims, he would pay to F. $150, three months after 
 he should be "well satisfied" that the title was undisputed. Upon suit 
 brought the defendant set up that he was "not satisfied," and the plea 
 was held bad, the court saying: "A simple allegation of dissatisfac- 
 tion, without some good reason assigned for it, might be a mere pre- 
 text, and cannot be regarded." This decision was followed in City of 
 Brooklyn v. Brooklyn City R. R., 47 N. Y. 475, 7 Am. Rep. 469, and 
 Miesell v. Insurance Co., 76 N. Y. 115: 
 
 In the case before us, the work required to be done was specified, 
 and was completed. The defendant made it available, and continued 
 to use the boilers without objection or complaint. If there was full per- 
 formance on the plaintiff's part, nothing more could be required, 
 aipd the time for payment had arrived; for, according to the doctrine 
 of the above cases, "that which the law will say a contracting party 
 ought in reason to be satisfied with, that the law will say he is satisfied 
 with." 
 
 Another rule has prevailed where the object of a contract was to grat- 
 ify taste, serve personal convenience, or satisfy individual preference. 
 In either of these cases the person for whom the article is made, or the 
 work done, may properly determine for himself — if the other party so 
 agree — whether it shall be accepted. Such instances are cited by the 
 appellant. One who makes a suit of clothes, (Brown v. Foster, 113 
 Mass. 136, 18 Am. Rep. 463,) or undertakes to fill a particular place 
 as agent, (Tyler v. Ames, 6 Lans. 280,) mould a bust, (Zaleski v. 
 Clark, 44 Conn. 218, 26 Am. Rep. 446,) or paint a pqrtrait, (Gibson 
 V. Cranage, 39 Mich. 49, 33 Am. Rep. 351; Hoffman v. Gallaher, 6 
 Daly, 42,) may not unreasonably be expected to be bound by the opin- 
 ion of his employer, honestly entertained. A different case is before 
 us, and in regard to it no error has been shown. 
 
 The judgment appealed from should be affirmed.^ 
 
 1 This is the rule very generally applied in the case of contracts for work 
 and materials where personal satisfaction is not made a condition in express 
 words and sometimes in the very teeth of an express provision creating such 
 a condition. Cashman v. Proctor, 200 Mass. 272, 86 N. E. 284 (1908) ; Handy 
 V. Bliss, 204 Mass. 513, 90 N. E. 864, 134 Am. St. Rep. 673 (1910) ; Sloan v. 
 Hayden, 110 Mass. 141 (1872) ; Hawkins v. Graham, 149 Mass. 284, 21 N. E. 
 312, 14 Am. St. Rep. 422 (1889) ; Doll v. Noble, 116 N. Y. 230, 22 N. B. 406, 
 5 L. R. A. 554, 15 Am. St. Rep. 398 (1889) ; Hummel v. Stern, 21 App. Div. 
 544, 48 N. Y. Supp. 528 (1900j, affirmed 164 N. Y. 603, 58 N. E. 1088 (1900) ; 
 Folliard v. Wallace, 2 Johns. (N. Y.) 395 (1807), condition of satisfaction with 
 title to land ; Lockwood Mfg. Co. v. Mason Regulator Co., 183 Mass. 25, 66 N. B. 
 420 (1903) ; Keeler v. Clifford, 165 111. 544, 46 N. E. 248 (1897) ; Brikson v. 
 Ward, 266 111. 259, 107 N. E. 593, Ann. Cas. 1916B, 497 (1915) ; Waite v. C. B. 
 
Sec. 2) CONDITION OF PERSONAL SATISFACTION 677 
 
 I 
 
 FECHTELER et al. v. WHITTEMORE et al. 
 (Supreme Judicial Court of Massachusetts, 1910. 205 Mass. 6, 91 N. E. 155.) 
 
 Action by Frank Fechteler and others against John Q. A. Whitte- 
 more and others. Judgment for plaintiffs, and defendants excepted. 
 Exceptions overruled. 
 
 Contract on an account annexed to recover $800 for transfer signs 
 made and shipped to defendants. The signs could be used in substitu- 
 tion for printed letters in signs for advertising and were sent to de- 
 fendants to be used on shoeblacking stands. The order was dated 
 March 29, 1904,. and specified that plaintiffs might ship to defendants 
 a certain number of signs, a sample lot o'i 25 to be sent first, and if, 
 "after a thorough trial," they were not found "to work satisfactorily," 
 the order was to be canceled. August 19, 1904, a sample lot was sent 
 to defendants, and on August 23d defendants wrote a letter saying 
 that the signs were satisfactory. On August 24th more signs were 
 shipped, and on April 1, 1905^ the final lot, making up the order, was 
 shipped. From August 23, 1904 to April 20, 1905, there was corres- 
 pondence between the parties. At the trial the plaintiffs, who had not 
 been paid for the signs, contended that defendants had had ample time 
 in which to test the signs, while the defendants contended that they 
 had a right to determine whether the goods were satisfactory, and that 
 they had not had sufficient time. There was a verdict for plaintiffs, 
 and defendants excepted. 
 
 Morton, J.^ The contract was partly in writing and partly in parol, 
 and it was rightly left to the jury to determine what the contract was 
 and whether it had been performed by the plaintiffs. The jury were 
 also rightly instructed that the defendants were not bound to accept 
 and pay for the goods until they had had a reasonable opportunity to 
 test and examine them, nor unless they were satisfactory to them, if 
 they acted in good faith and did what they ought reasonably to have 
 
 Shoemaker & Co., 50 Mont. 264, 146 Pac. 736 (1915) ; Gould v. McCormick, 75 
 Wash. 61, 134 Pac. 676, 47 L. K. A. (N. S.) 765, Ann. Cas. 1915A, 710 (1913) ; 
 Stevens v. Lakewood Utilities Co., 189 Mich. 208, 155 N. W. 402 (1915), to pay 
 balance "if ice is in good shape and satisfactory to us" ; Bruner v. Hegyi ( Cal. 
 App.) 183 Pac. 369 (1919), tile work in building; Miller v. Phillips, 39 R. I. 
 416, 98 Atl. 59 (1916), house painting ; Geo. W. Lord Co. v. Industrial Dyeing & 
 Finishing Works, 252 Pa. 421, 97 Atl. 573 (1916), water to be purified : Braun- 
 stein y. Accidental D. Ins. Co., 1 B. & S. 782 (1861), proof of loss to be "satis- 
 factory to the directors." 
 
 In McCartney v. Badovinac, 62 Colo. 76, 160 Pac. 190, L. R. A. 1917A, 
 1146 (1916), M.'s wife was charged with theft of a diamond. He hired B., 
 a detective, to determine the facts, promising to pay $500 to B. "in the event 
 that he shall determine the above questions to the satisfaction of said M." B. 
 clearly proved the wife guilty, and she confessed and fled the state. This 
 was not to M.'s satisfaction. B. got judgment. 
 
 Observe the difference between a promise of A. to satisfy B. and a promise 
 of B.' to pay if A. satisfies him, between a legal duty in A. and a condition 
 precedent to a legal duty in B. 
 
 " Part of the opinion is omitted. 
 
■678 IMPLIED AND CONSTEUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 done to decide whether the goods were or were not satisfactory. In 
 other words, the substance of the instructions in regard to the ques- 
 tion of satisfactoriness was that the defendants were not bound to 
 accept and pay for the goods unless they were satisfactory, and that 
 they were entitled to sufficient time "whether * * * three, or 
 four, or six months, or a year," to determine whether they were sat- 
 isfactory, and that it was for the jury to say, taking all of the circum- 
 stances into account, whether the defendants had had a reasonable 
 time to test and examine the goods, and, if that were so, then whether 
 as reasonable men acting in good faith towards the plaintiffs the goods 
 should have been accepted as satisfactory, and if they should have 
 been; then the defendants were liable ; otherwise not. This was cor- 
 rect and afforded the defendants no just ground for complaint. C. 
 W. Hunt Co. V. Boston Elevated Ry., 199 Mass. 220, 85 N. E. 446; 
 Cashman v. Proctor, 200 Mass. 272, 86 N. E. 284; Noyes v. Eastern 
 Accident Association, 190 Mass. 171, 182, 76 N. E- 665 ; Lockwood 
 Manuf. Co. v. Mason Regulator Co., 183 Mass. 25, 66 N. E. 420; Lov- 
 ett V. Farnham, 169 Mass. 1, 5, 47 N. E. 246; Page v. Cook, 164 
 Mass. 116, 41 N. E. 115, 28 U R. A. 759, 49 Am.. St. Rep. 449; 
 Hawkins v. Graham, 149 Mass. 284, 21 N. E. 312, 14 Am. St. Rep. 
 422. The contract related to an article of merchandise to be used for 
 purely business purposes and assumed that it would be satisfactory if 
 after a proper trial it ought to be, and that the defendants would there- 
 upon accept and pay for it. It was not intended to be left to the 
 whim or caprice or even altogether to the good faith of the defend- 
 ants to say whether the goods were satisfactory. Under the circum- 
 stances the term "satisfactorily" must be held to mean "satisfactorily 
 to a reasonable man," and the jury were so instructed. * * * 
 Exceptions overruled. 
 
 WILLIAMS v. HIRSHORN. 
 (Supreme Court of New Jersey, 1918. 91 N. J. Law, 419, 103 Atl. 23.) 
 
 Action by Lewis Williams against Jacob Hirshorn. Judgment for 
 plaintiff, and defendant appeals. Affirmed. 
 
 Trbnchard, J. The plaintiff below sued to recover the balance al- 
 leged to be due on his contract with the defendant wherein the plain- 
 tiff agreed to make the walls of the defendant's cellars waterproof, 
 and the latter agreed to pay $50 upon completion, "the balance ($50) 
 to be paid after a rain and a satisfactory test has been made." 
 
 We are of the opinion that the judgment for the plaintiff rendered 
 by the trial judge, sitting without a jury, must be affirmed. We think 
 the motion to nonsuit was properly denied, and that a jury question 
 was presented at the end of the case. It was admitted that the work 
 was done by the plaintiff, and that the balance sued for had not been 
 paid. It was also admitted that after the work was finished there had 
 
Sec. 2) CONDITION OP PERSONAL SATISFACTION Q7,9 
 
 been "a rain." The controversy turned upon the question: Had "a 
 satisfactory test" been made? 
 
 When by the terms of a contract work is to be paid for after "a 
 satisfactory test has been made," it must be satisfactory to the one 
 who is to pay for it, if, as here, the contract is silent as to the person 
 to whom the work shall be satisfactory. Singerly v. Thayer, 108 Pa. 
 291, 2 Atl. 230, 56 .\m. Rep. 207; Campbell Printing Press Co.' v. 
 Thorp (C. C.) 36 Fed. 414, 1 L. R. A. 645. The trial judge found 
 that, if there had not been a "satisfactory test," there could not be one^ 
 and that was so through no fault Of the plaintiff. The defendant 
 always expressed himself as dissatisfied, giving as a reason that after 
 a heavy rainfall there was considerable water in the cellars. It is true 
 that there was, but the trial judge found that it came in the cellar 
 windows, with which the plaintiff's contract had nothing to do, and 
 over which he had no control, and there was abundant evidence to 
 support that finding. Indeed, the proven statements and conduct of 
 the defendant indicated that he himself thought that the water came 
 in the windows, but the evidence tends to show that he never cor- 
 rected that trouble. 
 
 Now, the rule of- law is that, where a promisor agrees to pay for 
 work or goods provided he is satisfied with them, he must act honestly 
 and in good faith. To escape liability his dissatisfaction must be 
 actual, and not feigned; real, and not merely pretended. It is only 
 the actual existence, not the mere expression, of dissatisfaction that 
 can have this effect. He must, if a test is necessary to determine fit- 
 ness, give that test or permit it to be made. Where good faith is in 
 issue, and the evidence is conflicting, a jury question is presented. 
 Gwynn v. Hitchner, 67 N. J. Law, 654, 52 Atl. 997 ; Gerisch v. Her-i 
 old, 82 N. J. Law, 605, 83 Atl. 892, Ann. Cas. 1913D, 627. See, also, 
 cases collected in 9 Cyc. 624. 
 
 Whether in the case at bar the defendant acted in good faith in ex- 
 pressing his dissatisfaction with plaintiff's work upon the walls, when 
 the testimony tended to show that the water came through the win- 
 dows, for which the defendant and not the plaintiff was responsible, 
 was at least a jury question. 
 
 The judgment below will be affirmed, with costs.* 
 
 3 In accord: Silsby Mfg. Co. v. Town of Chico, 24 Fed. 893 (1885) ; Hart- 
 ford Sorghum Mfg. Co. v. Brush, 43 Vt. 528 (1871) ; Inman Mfg. Co. v. Ameri-i 
 can Cereal Co., 124 Iowa, 737, 100 N. W. 860 (1904). 
 
680 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 (i) Condition of Notice 
 ANONYMOUS. 
 
 (T. B. 18 Edw. IV, f. 18, pi. 23.) 
 
 In debt on obligation, etc., the defendant showed that the condition 
 was this, that if he should account before an auditor to be named by 
 the plaintiff as he should be required by the said plaintiff concerning' 
 certain receipts from his manor of Dale, and should pay to him all 
 arrears which should be found by the said auditor to be due, that then > 
 the obligation should be void, etc., otherwise, etc. And alleged in fact 
 that the said plaintiff appointed such a one, etc., before whom he made 
 account, and that he had always been ready and willing to pay the ar- 
 rears found by the auditor, etc., if the said auditor had given him 
 notice; and now the question was whether or not the defendant 
 should find out the fact for himself at his peril. 
 
 Choke. Siippose I am bound to Catesby in an obligation on this 
 condition, that if I pay the damages which shall be recovered against 
 the said Catesby in an action of trespass brought against him by, Gen- 
 ney, then, etc. In this case it is no defense for me to say that Catesby 
 did not give me notice as to the amount of the verdict against him, 
 but I must find out that fact for myself at my peril, and so here. 
 
 Brian ad idem. And where an arbitrament is had, the party must 
 find out what the award is at his peril and without notice ; quod Va- 
 visour and Catesby concesserunt,* and said that the very case put by 
 my Lord Brian had been so determined in the King's Bench in the 
 time of the present king. For this case of arbitrament see 8 Edw. 4. 
 
 Thereupon StarkEy imparled. 
 
 HOLMES V. TWIST. 
 (In the King's Bench, 1615. Hob. 51.) 
 
 Thomas Holmes brought an assumpsit against John Twist, and de- 
 clared that he was possessed of a heap of wood containing ten tuns, 
 and that Twist in consideration that Holrnes would sell and deliver 
 him one tun of the said wood, he would pay him for it within six 
 months, after the rate that he should sell the rest, and shewed that he 
 sol,d and delivered unto Twist the tun of wood, and after sold unto one 
 Collins the residue after the rate of 23 pounds a tun, and the defend- 
 ant paid him not the 23 pounds according to the promise, and there- 
 upon judgment was given for the plaintiff in the King's Bench, and 
 now upon writ of error in the Exchequer Chamber, the judgment was 
 reversed, because the plaintiff had not alledged that he had given no- 
 
 « In accord : Y. B. 1 Hen. VII, 5, 8. 
 
Sec. 2) 
 
 CONDITION OF NOTICE 681 
 
 tice to the defendant of the sale and price of the rest, being a thing of 
 his private knowledge, and not like the case of bond to perform the 
 award. And some Judges of the King's Bench allowed of the judg- 
 ment." 
 
 POWLE V. HAGGER. 
 (In the King's Bench, 1616. Cro. Jac. 492.) 
 
 Error of a judgm,ent in the Common Pleas, in an assumpsit; where 
 the defendant assumed, in consideration of divers sums paid to him, 
 that if Cooper affirmed at his return beyond sea that he received of 
 the plaintiff twenty pounds, that the defendant would pay the twenty 
 pounds: and alledged in fact that Cooper returned from. beyond sea, 
 and on such a day, year, and place, affirmed that he received of the 
 plaintiff twenty pounds, and that the defendant licet requisitus such 
 a day, year, and place, had not paid. The defendant pleaded non 
 assumpsit; and it was found against him, and adjudged for the plain- 
 tiff. 
 
 The error was assigned, for that it is not shewn before whom he 
 affirmed, nor that the defendant had notice given to him of this af- 
 firmation; for without notice given him he could not take cognizance 
 thereof, nor is he bound to pay it. 
 
 Sed non allocatur; for the defendant is to take notice of this af- 
 
 5 In accord: Gable v. Morse, 1 Bulst. 44 (1610), promise to pay a sum to 
 plaintiff on latter's return to London; Henning's Case, Cro. Jac. 432 (1617) ; 
 Tanner v. Lawrence, Aleyn, 24 (1648), promise to pay 2s. for every piece of 
 cloth that plaintiff might buy; Makin v. Watkinson, L. E. 6 Exch. 25 (1870), 
 promise to repair premises occupied by plaintiff; notice of disrepair 
 necessary. 
 
 In Vyse v. Wakefield, 6 M. & W. 442 (1840), the defendant having sold 
 a certain life annuity to the plaintiff for a large sum, agreed that the plain- 
 tiff might insure the defendant's life in any one of a large number of insur- 
 ance companies in England and promised further that he would never do . 
 anything that would invalidate the policy so taken out. The plaintiff took 
 out a policy on the defendant's life in a certain company, and later the de- 
 fendant invalidated it by going to Canada. . To a declaration for damages 
 for breach of defendant's promise the defendant demurred on the ground that 
 there was. no averment that the plaintiff had given notice to the defendant of 
 the fact that a policy had been issued or of the fact that it was conditional 
 on the defendant's not going across the ocean. The demurrer was sustained, 
 and I'AEKE, B., thus classified the cases : (1) "Where a party contracts to 
 do something, but the act on which the right to demand payment is to arise 
 is perfectly indefinite;" here notice must be given. (2) "No notice is req- 
 uisite when a specific act is to be done by a third party named, or even by 
 the obligee himself." (3) "There is an intermediate class of cases" where the 
 act to be done by the plaintiff is not wholly indefinite as to time or place ; 
 "where any option at all remains to be exercised on the part- of the plaintiff, 
 notice of his having' determined that option ought to be given." 
 
 In Costantino v. Lodjiodice, 93 Conn. 203, 105 Atl. 465 (1919), the court 
 said that the requirement of notice as a condition precedent "must be found 
 in the contract, or must arise as a matter of common fairness and equity from 
 the circumstances of the case." Notice is not necessary where the parties 
 have substantially equivalent sources of information. 
 
682 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. i 
 
 firmation as well as the plaintiff ; for the plaintiff is not bound to 
 give him notice thereof ; for the act being to be done by a stranger, and 
 not by the plaintiff, the cognizance thereof lies as well in the notice of 
 the defendant as . in the plaintiff's, and therefore the plaintiff need 
 not to give him any notice : whereupon the judgment was affirmed." 
 
 BROOKBANK v. TAYLOR. 
 (In the Exchequer Chamber, 1624. Oro. Jae. 685.) 
 
 Assumpsit. Whereas the plaintiff, at the defendant's request, 20 
 April, 19 Jac. 1. demised to one John Jennings his house in London 
 for a year a prsedicto 20 Aprilis, 19 Jac. 1, rendering fifty shillings 
 quarterly ; that the defendant promised, if the said Jennings did not 
 pay the rent, that he would pay it ; and alledgeth in fact, quod virtute 
 dimissionis he entered the aforesaid 20 April, 19 Jac. 1. and was pos- 
 sessed, and had not paid the rent ; and that the defendant, licet requisi- 
 tus, had not paid it. The defendant pleaded non assumpsit ; and found 
 against him; and the jury find damages occasione assumptionis prse- 
 dict. to five pounds ; and judgment thereupon ; and error thereupon in 
 the Exchequer-Chamber. * * * 
 
 The second error assigned was, because it is not alledged, that no- 
 tice was given that the other had not paid.'' Sed non allocatur; for 
 he at his peril ought to take cognizance of the non-payment and pay 
 the rent, otherwise the promise is broken. * * * 
 
 Wherefore the judgment was affirmed.^ 
 
 MELLES & CO. V. HOLME. 
 
 (In the King's Bench Division, 1918. 119 Law T. [N. S.] 191.) 
 
 Salter, J. This is an action for damages for breach of covenant to 
 repair. The facts are that the defendants on the 24th June 1915 de- 
 mised to the plaintiffs certain rooms in a house of the defendants by 
 a lease dated the 24th June 1915. Other portions of the house were 
 let to other persons. In particular, rooms above those demised to the 
 
 8 In accord: Fletcher v. Pynsett, Cro. Jac. 102 (1605), to pay money to 
 ElaintLH: on his marriage to X. ; Beresf ord v. Goodrouse, 1 Eolle Abr. 463, pl- 
 3, 4 (1616), same; Jackson v. Thornell, 1 RoUe Abr. 464, pl. 20 (1628), to 
 pay sum to be named by X. ; Normanvile v. Pope, Cro. Jac. 137, 150 (1605) ; 
 Cutler V. Southern, 1 Wms. Saunders, 116 (1667), to keep plaintiff harmless 
 from suits by X.; King v. Atkins, 1 Sid. 442 (1670), same;- Clerke v. Child, 
 Freeman, 254 (1678), to convey more land if a tract should measure under 
 40 acres. 
 
 '' Parts not relating to this error are omitted. 
 
 8 In accord : Haverleigh v. Leighton, Jenkins' Centuries, 311 (1610) ; 
 Somersall v. Bameby, Cro. Jac. 287 (1611). See Ames' Cases on Suretyship, 
 225, and note citing many cases pro and contra. 
 
Sec. 2) CONDITION OF NOTICE - ; , ■ S83 
 
 plaintiffs were let to persons who carried on a boot manufacturing 
 business. The lease to the plaintiffs contains a covenant by the les- 
 sors that they will keep the outside walls and roof of the demised 
 .premises in good and tenantable condition. The. roof— including in 
 the expression the gutters and rain-water pipes — appears to have been 
 kept in perfectly good repair. The landlords employed a person to 
 inspect every three months, and he appears to have done his duty; 
 but by some means one of the rain-water pipes became choked within 
 a few feet of the top. There was evidence to the effect that ashes 
 from the chimneys fell upon the roof, and that, because of this, .the 
 landlords took care to see to the gutters ; but it also appeared from 
 the evidence that refuse from the rooms where the boot manufac- 
 ture was carried on was wont to accumulate on the roof. In the 
 resultj the rain lying in the gutters came through the roof and down 
 the walls to the rooms occ\ipied by the plaintiffs. It is material to 
 observe that their lease expressly provided that they should use the 
 rooms only for exhibition or storage of certain perishable wares. 
 
 In an action for damages for bifeach of covenant a learned County 
 Court jiidge has found for the defendants. He held that there was 
 no want of care on the part of the landlords, and that, in the absence 
 of notice of want of repair, and assuming that it was a breach of cove- 
 nant to allow the pipes to become stopped up, the action could not be 
 maintained. In my view that judgment cannot be supported. The mat- 
 ter turns upon the covenant to which I have referred. I do not think 
 it is necessary to consider any inaplied term. No implied term could 
 be wider — even if it were as wide — as the express term which is to be 
 found in the lease. It has been contended, however, that the plain- 
 tiffs cannot enforce the performance of this covenant — even if it was 
 broken — ^because they gave no notice of want of repair. The rule that 
 in some cases there must be read into a landlord's covenant to repair 
 an implied condition that notice of a defect shall be given to him 
 depends in the first instance in Makin v. Watkinson, 23 L,. T. Rep. 592 ; " 
 L. R. 6 Ex. 25, and the principle of the rule is there enunciated. It 
 is that where the circumstances are that the landlord does not and 
 could not know of the existence of the defect unless the tenant in- 
 forms him, or where he has no right to enter upon the premises, then 
 in such circumstances it is reasonable and in accordance with common 
 sense to imply that he shall have notice of want of repair. (See per 
 Collins, M. R., in Tredway v. Machin, 91 L. T. Rep. 310, 311.) There 
 must te a strong reason tp justify our reading into a covenant words 
 which are not there. Here, having regard to the plain intention of the 
 parties, there is no such reason. The roof was in the possession and 
 under the control of the landlords. It was not in the possession of nor 
 was it under the control of the tenant, and the landlords were in a 
 better position than he was to know of the condition. 
 
 The question remains — Oh the facts was there a breach? I am of 
 
684 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 opinion that the covenant must be read as applying to the roof, in so 
 far as it covered these premises, which were in fact a set of rooms. 
 As it was the expressed intention that the obligation of the defend- 
 ants under the covenant included the scouring of the gutter and the 
 keeping of the passage of the down-flow pipe at all times free, as they 
 failed to so that they were gtiilty of a breach of covenant, and the 
 judgment should have been for the plaintiffs for the amount of the 
 damages found by the judge. 
 
 Roche, J. I agree. 
 
 Appeal allowed.' 
 
 MASON V. HARVEY. 
 (In the Court of Exchequer, 1853. 8 Exch. 819, 155 Eng. Eep. 1585.) 
 
 Assumpsit on a policy of insurance effected by the plaintiff, a pawn- 
 broker, with the Norwich Union Fire Insurance Society. The dec- 
 laration stated the insurance to be (inter alia) £150 on the shop of the 
 plaintiff and ilOOO on pledges received under the 39 & 40 Geo. Ill, 
 c. 99 ; also that there was indorsed on the policy the following (among 
 other) conditions: "Eighth: Whenever any fire shall happen, the 
 party insured shall give immediate notice thereof to one of the secre- 
 taries or agents of the society, and within three calendar months 
 deliver to such secretary or agent, under his or her hand, accounts 
 exhibiting the full particulars and amount of the loss sustained, es- 
 timated with reference to the state in which the property destroyed or 
 damaged was immediately before the fire happened ; and such accounts 
 shall, if required by the directors, be supported by the oral testi- 
 mony, and by the depositions or affirmations in writing of the claim- 
 ant, and of his or her servants, and by the production of his or her 
 books and vouchers." The declaration alleged that,, whilst the prop- 
 erty continued so insured, the "said shop and divers pledges received 
 under the 39 & 40 Geo. Ill, c. 99, and then being in the said shop, 
 were damaged and destroyed by fire," &c. Breacb, that the loss which 
 so- happened has not been made good to the plaintiff. 
 
 Plea, that the plaintiff did not, within the period of three calendar 
 months after the said shop and pledges were so damaged and destroyed 
 by fire, deliver to any secretary or agent of the said society, under his 
 hand, any such accounts as are in and by the eighth condition mentioned 
 and required, exhibiting the full particulars and amount of the loss 
 sustained by the plaintiff as alleged, estimated with reference to the 
 state in which the property damaged and destroyed was immedi- 
 ately before the fire happened by which the property was so damaged 
 and destroyed. 
 
 Demurrer and joinder. 
 
 »In accord: Hayden v. Bradley, 6 Gray (Mass.) 425, 66 Am. Dec. 421 
 (1856). Cf. Hugall v. McLean, 53 L. T. 94 (1885.) 
 
Sec. 2) ALEATORY CONTRACTS 685 
 
 Pollock, C. B. By the contract of the parties, the delivery of the 
 particulars of loss is made a condition precedent to the right of the 
 assured to recover. It has been argued that such a construction 
 would be most unjust, since the plaintiff might be prevented from, 
 recovering at all by the accidental omission of some article. But 
 the condition is not to be construed with such strictness. Its mean- 
 ing is, that the assured will, within a convenient time after the loss, 
 produce to the company something which will enable them to form a 
 judgment as to whether or no he has sustained a loss. Such a con- 
 dition is, in substance, most reasonable ; otherwise a party might lie 
 by for four or five years after the loss, and then send in a claim when 
 the Company perhaps had no means of investigating it. The plaintiff 
 may have liberty to amend by withdrawing the demurrer, otherwise 
 judgment for the defendant. 
 
 Alderson, B., Platt, B., and Martin, B., concurred. 
 
 Amendment accordingly.^" 
 
 (j) Conditions in AlSatory Contracts 
 
 MARTINDALE v. FISHER. 
 
 (In the Court of King's Bench, 1745. 1 Wils. 88.) 
 
 This is a special action upon the case, wherein the plaintiff sets 
 forth in his declaration that an horse-race was agreed to be run be- 
 tween an. horse of the plaintiff and one of Sir Marmaduke Wyvill's, 
 and that in consideration that the plaintiff had agreed to deliver to the 
 defendant three yards and one-eighth of cloth, the defendant agreed 
 to pay to the plaintiff iS 12s. 6d. in case Sir Marmaduke Wyvill's 
 horse should beat the plaintiff's horse, but if the plaintiff's horse beat 
 Sir M. W.'s, then defendant to pay nothing for the cloth ; and avers, 
 that Sir M. W.'s horse won the race. Upon the general issue there 
 was a verdict for the plaintiff. It was now moved in arrest of judg- 
 ment, and the exception taken to the declaration by Serjeant Bootle 
 was, that it is not averred in the declaration that the cloth was de- 
 livered to the defendant. But to this it was answered by Mr. Ford, and 
 resolved by the Court, that this was an action founded on mutual prom- 
 ises, and that here was only promise for promise, and therefore it was 
 not necessary for the plaintiff to make an averment in his declaration 
 
 10 See Reed v. Loyal Protective Ass'n, 154 Mich. 161, 117 N. W. 600 (1908), 
 post, p. 870; Everson v. General Accident Fire & Life Assur. Corp., Limited, 
 of Perth, Scotland, 202 Mass. 169, 88 N. E. 658 (1909), left to the jury to 
 say whether notice within four days was "with reasonable promptness ; In 
 re Coleman's Depositories, [1907] 2 K. B. 798, held that notice of the acci- 
 dent was not a condition even though the policy declared it to be "of the 
 essence", because the insurer had not yet delivered the policy and the in- 
 sured had no notice that notice was required. 
 
686 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 of the delivery of the cloth : and the Court said, the case of Nichols and 
 Raynbred, Hob. 88, is in point. 
 
 Dennison, J., said, that where a plaintiff declares, that in considera- 
 tion he the said plaintiff would deliver to the defendant a piece of cloth 
 to the defendant, that the defendant should pay such a sum of money 
 for it, in that case an averment of the delivery of the cloth is nec- 
 essary; but if the plaintiff states an agreement, and then lays it that 
 in consideration of such a promise or agreement, &c. there is no need 
 of an averment. So N. B. the difference. And the postea was ordered 
 to be delivered to the plaintiff. Vide Hob. 106. Yelv. 136. 7 Lev. 
 293. Hard. 103." 
 
 CHRISTIE V. BORELLY. 
 
 (In the Court of Common Pleas, 1860. 29 L. J. Com. PI. 153.) 
 
 The first count of the declaration stated that, in consideration that 
 the plaintiff guaranteed to the defendant that two bills of exchange, 
 of ilOO and £62, both drawn by Messrs. C. W. Olivier & Co. upon 
 Messrs. Owen & Co., 75 Lower Thames Street, and both due on 
 January 23d, 1859, would be paid and retired by the said Messrs. 
 Owen & Co. when due, the defendant, in return, engaged and guar- 
 anteed to the plaintiff the repayment of the sum of i300 towards the 
 payment of Scotch whiskies, as follows : Six puncheons, Shhds., 4 
 qr. casks, Auchtertool, 2 puncheons, 5 hhds., 8 qr. casks, Anderton, 
 which Mr. B. Fisse, of Norris Street, had ordered, and was about 
 to receive from the plaintiff. Averment, by the plaintiff, that he had 
 performed all things on his part to be done and performed, in pur- 
 suance of the said agreement, to entitle him to the due perform- 
 ance by the defendant of his, the defendant's, part of the said agree- 
 ment; and that the said two bills of exchange of £100 and £62 were 
 duly paid and retired by the said Messrs. Owen & Co. when the same 
 became and were due and payable; and that he, the plaintiff, deliv- 
 ered to the said Mr. B. Fisse, the said Scotch whisky, in the said 
 agreement hereinbefore mentioned, and that the said Mr. B. Fisse, 
 
 1 1 For other cases of aleatory contracts, see Henderson v. Stone, 1 Mart. 
 X. S. (La.) 639 (1823), horse race; Moore v. Johnston, 8 La. Ann. 488 
 (1852), same; Seward v. Mitchell, 1 Cold. (Tenn.) 87 (1860); ante, p. 
 296; Ptacek v. Pisa, 231 111. 522, 83 N. E. 221, 14 L. K. A. (N. S.) 537 (1907), 
 promise to support X. for life in return for being made beneficiary of an ■ 
 insurance policy ; after supporting X. for five years, plaintiff sent him to 
 the poorhouse ; he now fails to recover even quantum meruit. In Losecco v. 
 Gregory, 108 La. 648, 32 South. 985 (1902), plaintiff contracted ■ to buy all 
 the oranges that defendant's grove might produce in 1899 and 1900, for 
 .$8,000 payable half in advance, "purchaser assumes all risks." An unprece- 
 dented freeze killed every orange tree on the place. Buyer sued to recover 
 $4,000 paid in advance. The court allowed three arguments and decided in 
 three different W9.ys by variable majorities ; the final decision b,eing ^tjjat 
 the contract was aleatory and that the plaintiff must pay the balance of the 
 price to the defendant, for which he had counterclaimed. 
 
Sec. 2) ALEATORY CONTBACTS 687 
 
 although requested to pay the said amount of iSOO toward the pay- 
 ment of the said Scotch whiskies, had not paid for the said Scotch 
 whiskies, nor the Said sum of i300 or any part thereof, and the same 
 still remained wholly due and unpaid; yet that the defendant had 
 disregarded and broken hip said promise in this, that he had not paid, 
 or caused to be paid, to the plaintiff the said sum of £300, or any part 
 thereof, but, on the contrary thereof, wholly neglected and refused 
 so to do. 
 
 The defendant pleaded (inter aha), secondly, to the said first count, 
 that, although the said debt and sum of iSOO, in the said first count 
 mentioned, repayment whereof the defendant engaged and guaran- 
 teed to the plaintiff, was not payable, and, by the terms of the said 
 order of the said Mr. B. Fisse, was not payable until after the said 
 two bills drawn by Messrs. C. W. Olivier upon Messrs. Owen & Co., 
 and guaranteed by the plaintiff, became due and payable, as the plain- 
 tiff and the defendant, at the time of the making of the said mutual 
 agreement and guarantees, well knew; yet the said two bills of ex- 
 change of i 100 and £62, in the said first count mentioned, were not duly 
 or at any time paid or retired by the said Messrs. Owen, of which 
 the plaintiff had due notice, but never at any time paid or retired the 
 said bills. Issue thereon. 
 
 The defendant having, at the trial, obtained a verdict in his fa- 
 vor on -the issue taken on the second plea, the Court, in Michaelmas 
 Term last, on the application of Edward James, granted a rule nisi 
 to enter judgment for the plaintiff on such issue non obstante vere- 
 dicto, on the ground that the said second plea was no answer to the 
 action. 
 
 ErlE, C. J.^^ I am of opinion that this rule should be made abso- 
 lute, and that the plaintiff is entitled to have judgment entered for 
 him non obstante veredicto. The real question is, whether the prom- 
 ises are independent promises, or whether they are mutual promises, 
 their performance being mutually the consideration for each other. 
 It appears to me that they are independent promises. The defend- 
 ant guarantees the repayment of £300 toward the payment of cer- 
 tain whisky being paid for when due; and the plaintiff guarantees 
 that two bills of exchange of £100 and £62 shall be paid when due. 
 It, therefore, appears that the damages in respect of the breach on 
 one side must be very different from the damages arising from the 
 breach on the other side ; on the one side they would be £300, and on 
 the other only £162; it is consequently apparent, on the face of the 
 contract itself, that it was not intended by the parties that perform- 
 ance of the one stipulation should be a condition precedent to per- 
 formance of the other. The question is, to my mind, one entirely 
 of fact — namely, what was the intention of the parties to this con- 
 tract? The rules of law are agreed on by both -sides, and it is only 
 
 ^ 2 The concurring opinion of Willes, J^., is omitted. 
 
688 IMPLIED AND CONSTKDCTIVB CONDITIONS PRECEDENT (Ch. 4 
 
 a question of construction. On the construction , of this contract, I 
 am of opinion that the performance of the plaintiff's promise was 
 not a condition precedent, and, therefore, that the second plea is no 
 answer, and consequently that the rule ought to be made absolute. 
 
 Williams, J. The rules of law are now well established, and the 
 object is to discover in each case what is the intention of the parties. 
 If it had appeared from the contract in the present case, that the 
 undertaking of the plaintiff had been to pay absolutely when the 
 bills became due, the case would have been a very different one from 
 what it ,is. What, however, the plaintiff undertakes is, only to pay 
 if Messrs. Owen do not retire the bills; therefore-, the compensation 
 to be paid by the plaintiff, in consequence of such third party not 
 doing their duty, is a matter which must have to be afterward ascer- 
 tained; and is it likely that it was the intention of the parties to this 
 contract that the defendant's performance was not to take place 
 until after such amount of compensation had been ascertained? It 
 is, I think, obvious that such could not have been the intention of the 
 parties; for Messrs. Owen might have retired the bills when due, 
 and so there would have been nothing at all payable by the plaintiff. 
 
 Rule absolute.^* 
 
 13 "In every purely bilateral contract not under seal the mutual promises, 
 are necessarily, in legal contemplation, the full equivalent of each other ; for 
 otherwise the promise on one side would be in part a mere gift, and -therefore 
 would be invalid for want of consideration. In bilateral contracts under 
 seal there is not the same legal necessity that the mutual covenants should 
 be the full equivalent of each other, yet a case will rarely occur In which 
 they must not be so regarded in fact. For all practical purposes, therefore, 
 it may be said that mutual covenants and promises are always, in legal 
 contemplation, the full equivalent of each other, and are given and re- 
 ceived in payment for each other. And what is thus true of mutual covenants 
 and promises is also necessarily true of the performance of them, provided 
 the performance on each side is equally certain; but if the performance on 
 one side is conditional, while on the other side it is unconditional, the In- 
 ference is that the conditional performance makes up in quantity what it 
 loses in certainty; and therefore, though the covenants or promises are 
 equal, the performances are unequal. In other words, whenever the per- 
 formances of mutual covenants or promises are unequal in certainty, they 
 will also be unequal in amount, and hence there will be no foundation for 
 making one dependent upon the other by implication. This seems to have 
 been the true ground for the decision in Martindale v. Fisher, 1 Wilson, 8& 
 (1745). This principle is especially applicable to all that class of contracts 
 known to writers on the civil law as aleatory or hazardous contracts, e. g. 
 contracts of insurance, of indemnity, of suretyship or guaranty, of warranty 
 in sales of personal property, and covenants for title in sales of real estate. 
 In most cases all of these contracts are unilateral, and then of course no 
 question of dependency can arise; but even when the are bilateral, it 
 seems that the covenants or promises are never dependent by implication. 
 The consequence will generally be the same if the performance on each side 
 is conditional, for the court can seldom say that each condition creates the 
 same degree of uncertainty. Therefore mutual promises of guaranty are not 
 dependent by implication, unless at least the debts guaranteed are of the 
 same amount. Christie v. Borelly, 29 L. J. O. P. 153 (I860)." Langdell's 
 Summary of Contract Law, § 107. 
 
.Sec. 2) ALEATOET CONTBACTS 689 
 
 SMITH V. COMPTON et al. 
 (Supreme Court of California, 1856. 6 Cal. 24.) 
 
 The plaintiff brought his action on a tripartite agreement (not un- 
 der seal) dated Nov. 22, 1853, between Wm. A. Richardson of the first 
 part, Chas. S. Compton and D. Davidson (the defendants) of the sec- 
 ond part, and Wm. Smith (the plaintiff) of the third part ; which he- 
 cites that Smith had recovered a judgment for $3,913, besides costs, 
 the whole bearing interest, against Richardson, under which he had 
 levied on property of Richardson in Marin County ; and contains the 
 following agreements: Richardson agrees that the interest shall be 
 compounded, and bear interest with the principal. Compton and Da- 
 vidson agree that the property levied on shall not be removed, and 
 shall remain subject to the levy, and also guarantee the payment of 
 the judgment and costs. Smith agrees to' suspend all proceedings under 
 the judgment for four months, and to assign the judgment, on a week's 
 notice, to Compton and Davidson, on their paying him the amount due 
 at any time previous to the expiration of the four months. A payment 
 of $300 on account of the judgment in Smith v. Richardson, was ad- 
 mitted. The. performance by plaintiff of his portion of the contract is 
 put in special issue by the pleadings. 
 
 On the trial of the cause, the defendants (plaintiff) introduced the 
 contract in evidence, and then rested his case. The defendants then 
 moved for a non-suit, upon the ground, among others, that the plain- 
 tiff had not proved a compliance with his agreement to suspend pro- 
 ceedings. 
 
 The motion for a non-suit was overruled, and the plaintiff (defend- 
 ants) then introduced testimony to the effect that the levy was made 
 on Richardson's property under plaintiff's judgment, on Nov. 10, 1853, 
 and a portion of the property sold under the orders of plaintiff, March 
 6, 1854, the remainder being claimed by other parties and found to 
 be their property by a sheriff's jury. The plaintiff tlien proved that 
 ■the defendants assented to the sale being made prior to the expira- 
 tion of the foun months, and actively assisted therein, and the jury so 
 found under tire instructions of the Court. The Court instructed the 
 jury if they found for the plaintiff, to give a verdict for the amount of 
 the judgment against Richardson, less the amount paid, with simple 
 interest at three per cent. 
 
 The jury found a verdict for plaintiff for $3,912.55. Judgment ac- 
 cordingly. Defendants moved for a new trial, which was denied by 
 the Court, and defendants appealed. 
 
 Mr. Justice Terry delivered the opinion of the Court. Mr. Justice 
 HeydENFELdt concurred. 
 
 The promise on the part of plaintiff to stay proceedings under his 
 judgment against Richardson, was a condition precedent to the guar- 
 
 COBBIN CONT 44 
 
690 IMPLIED AND CONSTRUCTIVE CONDITIONS PEBCEDENT (Ch. 4 
 
 anty sued on, and performance on his part should have been alleged 
 and proven, to entitle him to recover against defendants. 
 
 This was not done in the opening, and defendant was entitled to a 
 judgment of non-suit.^* 
 
 The defendant, however, after his motion was denied, introduced 
 evidence which enabled plaintiff to supply the defect in his case, and 
 by so doing, waived the objection. See Ringgold v. Haven, 1 Cal. 
 108. 
 
 From the whole record, the right of plaintiff to recover clearly ap- 
 pears ; and we will not disturb a judgment, when it is evident that 
 a new trial must be attended with the same result. 
 
 The judgment is affirmed with costs." 
 
 NATIONAL SURETY CO. v. WIN§TON et al. 
 
 X Supreme Court of New York, Appellate Division, 1914. 161 App. Div. 594, 
 
 MSN. Y. Supp. 825.) 
 
 Action by the National Surety Company against James O. Winston 
 and Thomas S. Winston, partners as Winston & Co., and another. 
 From a judgment for plaintiff, defendants appeal. Affirmed. 
 
 i*Coiitra : United & Globe Rubber Mfg. Co. v. Conard, 80 N. J. Law, 286, 
 78 Atl. 203, Ann. Cas. 1912A, 412 (1910). 
 
 ^^ Where the defendant became surety for another's debt, and in return 
 the creditor promised to assign certain securities to the surety, it is held that 
 the creditor can maintain no action on the surety's promise unless ,he has 
 assigned the security as agreed. Griggs v. Moors, 168 Mass. 354, 47 N. E. 128 
 (1897). The same is true where the creditor has promised to do other acts 
 for the surety's protection. Watts v. Shuttleworth, 5 H. & N. 235, 7 H. & 
 N. 355 (1861) ; Walker v. Goldsmith, 7 Or. 161 (1879) ; Eolt v. Cozens, 18 
 C. B. 673 (1856), perhaps distinguishable as a unilateral contract; Jones v. 
 lieer, 30 Ga. 93 (1860) ; Capps v. Smith, 3 Scam. (111.) 177 (1841) express 
 condition; Jeffries v. Lamb, 73 Ind. 202 (1880) ; Campbell v. Gates, 17 Ind. 
 126 (1861) ; Fay & Co. v. James Jenks Co., 93 Mich. 130, 53 N. W. 163 (1892) ; 
 Bookstaver v. Jayne, 60 N. Y. 146 (1875). 
 
 Where an insurance policy has been issued in return for a promissory note 
 for the premium, it is held that the duty of the insurer to pay the amount 
 of the policy is not conditional upon the payment of the note when due. 
 Mutual Life Ins. Co. of New York v. Allen, 212 lU. 134, 72*». E. 200 (1904) ; 
 Bradley V. Federal Life Ins. Co., 178 111. App. 524 (1913) ; Trade Ins. Co. v. 
 BarraclifC, 45 N. J. Law, 543, 46 Am. Rep. 792 (1883) ; Arkansas Ins. Co. 
 V. Cox, 21 Okl. 873, 98 Pac. 552, 20 L. R. A. (N. S.) 775, 129 Am. St. Rep. 
 808 (1908) ; Lawrence v. Penn Mut. L. Ins. Co. of Newark, N. J., 113 La. 
 87, 36 So. 898, 1 Ann. Cas. 965 (1904) ; Langbehn v. American Ins. Co. of 
 Newark, N. J., 41 S. D. 581, 171 N. W. 820 (1919). But payment of the 
 premium note is usually made a condition precedent by express provision in 
 the policy. Marshall v. Farmers' & Bankers' Life Ins. Co., 98 Kan. 502, 159 
 Pac. 17 (1916) ; Mutual Aid Union v. Wadley, 125 Ark. 449, 188 S. W. 1168 
 (1916) ; Carey v. Amicable Life Ins. Co. (Ga. App.) 100 S. E. 225 (1919) ; 
 Hinkson v. Kansas City Life Ins. Co., 93 Or. 478, 183 Pac. 24 (1919) ; Blge- 
 low V. State Mutual Life Assur. Ass'n, 123 Mass. 113 (1876). 
 
 In New England Mut. Fire Ins. Co. v. Butler, 34 Me. 451 (1852), post, p. 
 739, an insurer got judgment on a premium note, even though it had repudiat- 
 ed its own promises. 
 
Sec. 2) ALEATORY CONTEAOTS 691 
 
 Scott, J. Defendants were awarded a contract to construct a por- 
 tion of the new aqueduct for the city of New York. They gave the 
 city an undertaking of the Empire State Surety Company in the sum 
 of $80,000, and at the same time executed an agreement to indemnify 
 the Surety Company and to pay it an annual premium of $1,200, pay- 
 able in advance on the 20th day of September, afterwards changed to 
 the 20th day of February, in each year. The Empire State Surety 
 Company became insolvent and is now in process of liquidation. 
 
 On September 18, 1912, the Empire State Insurance Company re- 
 insured all of its risks with plaintiff and assigned to it all of its good 
 will, agreements of insurance and reinsurance, indemnity agreements, 
 and the like; plaintiff agreeing on its part to assume and fulfill all 
 the outstanding contracts of the Empire State Surety Company. 
 Neither the city of New York nor defendants were parties to this 
 agreement, nor so far as appears have consented to it; .but, on the 
 other hand, it does not appear that the city has called on defendants 
 to substitute other security. This action is for the premium which 
 fell due February 20, 1912, which defendants refused to pay. 
 
 The appellant argues that by becoming insolvent the Empire State 
 Company necessarily broke its contract with the city of New York 
 to insure defendant's faithful performance of its contract, and con- 
 sequently that the contract of indemnity failed of consideration to 
 support it. This argument is supported by a line of cases holding 
 that an insurer or casualty company upon becoming insolvent or 
 reinsuring its policies, breaks its contract with its policy holders, and 
 that they are not required to go on paying premiums or to accept the 
 substitution of the reinsuring company. 
 
 The analogy is not perfect, however. Defendants are not, in the 
 usual sense, policy holders of the Empire State Company. That com- 
 pany does not insure defendants. Its agreement with them is that it 
 will insure the city of New York against any default on the part of 
 defendants. If the city is content to accept the substituted surety, as 
 it appears, to be, defendants get all that they contracted for. So long 
 as the city is satisfied, it can make no difference to defendants who 
 the city accepts as surety. If it accepts any one, the defendants have 
 received consideration for their indemnity agreement. 
 
 The Empire State Company still exists and is still liable upon its 
 bond, and for all that appears its bond is perfectly good, notwith- 
 standing its insolvency. It has simply superadded to its own responsi- 
 bility that of plaintiff, and it, or its assignee, are entitled to enforce 
 the indemnity agreement. 
 
 Judgment appealed from is affirmed, with costs. All concur. ^° 
 
 18 The failure of the contractor to pay the premiums does not release the 
 surety from his duty to his promisee (the creditor or owner). Massachusetts 
 Bonding & Insurance Co. v. State (Ind. App.) 127 N. E. 223 (1920). Cf. 
 Merritt v. Haas, 113 Minn. 219, 129 N. W. 379 (1911). 
 
692 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 (k) Charter Parties — ^Leases 
 
 SHADFORTH v. HIGGIN. 
 (At Nisi Prius, 1813. 3 Camp., 385.) 
 
 Assumpsit upon the following agreement signed by the plaintiff and 
 defendant : 
 
 "James Shadforth, part owner of the ship Fanny of 300 tons, cop- 
 pered and armed, agrees to dispatch said vessel immediately in bal- 
 last direct to Jamaica, arid on her arrival at Rio Nova Bay, Salt Gut, 
 and St. Ann's, receive a full and complete cargo of produce, consist- 
 ing of sugar, rum, coffee, and pimento. In return Messrs. Higgin & 
 Co. agree to provide a cargo to the above shipping places, to be tak- 
 en on board in the usual manner, in time for July convoy, provided' 
 she arrives out and ready by the 25th of June, and the freight to be 
 .at the current rate as given to other vessels loading at the same time 
 and same ports." 
 
 The declaration alleged, that the defendants did immediately dis- 
 patch the vessel in ballast to Jamaica, and that on her arrival at Rio 
 Nova Bay she was afterwards, to wit, on the 3rd of July, and from 
 thence for a long space of time, to wit, for the space of three months 
 from thence next ensuing, ready to receive at Rio Nova Bay, Salt 
 Gut, and St. Ann's aforesaid, a full and complete cargo of produce, 
 according to the form and effect of the said agreement ; yet that the 
 defendant did not nor would provide a cargo for the said vessel at 
 the above shipping places, or any or either of them, according to the 
 form and effect of the said agreement, whereby the said ship was 
 obliged to return from Jamaica without any cargo being loaded on 
 board thereof. 
 
 The ship in point of fact did not reach Jamaica till the 3rd of July ; 
 and the question was, whether under these circumstances the defend- 
 ant was answerable for having failed to furnish her with a full cargo. 
 
 Garrow, S. G., for the plaintiff, contended, that the defendant was 
 bound to furnish a full cargo for the ship at all events. Provided she 
 arrived out and was ready by the 25th June, this was to be done in 
 time to enable her to sail with the July convoy. The condition of her 
 arriving by 2Sth June only applied to the time of her departure on the 
 homeward voyage. If by any accident her arrival was delayed beyond 
 the day specified, she was still entitled to a cargo in a reasonable time^ 
 as if the proviso and the mention of the July convoy had not been in- 
 troduced into the agreement. It could hardly be meant, that where 
 the owner was absolutely bound to dispatch his ship to Jamaica, if she 
 arrived a day later than was expected, the freighter might send her 
 home lempty. 
 
 Lord EllEnborough. I think the arrival of the ship on the 25th 
 June was a condition precedent. The freighter might know that if 
 
Sec. 2) CHARTER PARTIES — ^LEASES 693 
 
 she arrived by that day he could easily provide a cargo for her ; but 
 that afterwards it might be impossible. He might have had goods of 
 his own, which it was essentially necessary should be shipped by that 
 day, and which he was therefore compelled to load on board another 
 vessel. It would be a great hardship if he were bound to provide a 
 freight for a vessel which arrives at a season of the year when there is 
 no produce ready for shipping in the island. If the freighter is liable, 
 although the ship does not arrive till a week after the day agreed up- 
 on, where is the line to be drawn? I think the fair interpretation of 
 the instrument is, that unless the ship arrived by the 25th June, the 
 defendant's liability was to be at an end. 
 
 The plaintiff likewise failed in estabhshing another agreement de- 
 clared upon for the loading of the ship, and submitted to bs nonsuited. 
 
 OLLIVE v. BOOKER. 
 (In the Court of Exchequer, 1847. 1 Exch. 416.) 
 
 Assumpsit, for breach of a charterparty agreement set out verba- 
 tim in the eighth plea below. The plaintiff alleged performance by 
 himself, and a breach by the defendant in that the latter refused to 
 ship a cargo of goods as agreed, although the plaintiff was ready to 
 receive the cargo, as the defendant knew. 
 
 Eighth plea, as to the first count: The defendant says, that the 
 said charterparty made between the plaintiff and the defendant was 
 and is made in the words and figures following, that is to say : "Lon- 
 don, 24th December, 1844. Charterparty. It is this day mutually 
 agreed between Messrs. Ollive, Nephew & Co., original charterers of 
 the good ship or vessel called The Dove, A 1, of the measurement of 
 149 tons, or thereabouts, now at sea, having sailed three weeks ago, 
 and Messrs. Booker & Co., merchants, that the said ship, being tight, 
 staunch, and strong, and every way fitted for the voyage, shall, with 
 all convenient speed, sail and proceed to Marseilles, (after having de- 
 livered her cargo at Genoa, for ship's account,) or so near thereunto 
 as she may safely get, and there load 'from the factors of the' said 
 charterers a full cargo of linseed or other goods, which the said mer- 
 chants bind themselves to ship, not exceeding what she can reason- 
 ably stow and carry over and above her tackle, apparel, provisions, 
 and furniture ; and being so loaded, shall therewith proceed to one 
 safe port in the United Kingdom, calling at Cork or Falmouth for 
 orders, which are to be given in due course of post, or so near there- 
 unto as she may get, and deliver the same on being paid freight at and 
 after the rate of 5s. 6d. per imperial quarter for linseed, or other 
 goods in full proportion, according to the Lon.don printed rates deliv- 
 ered: the act of God, restraints of princes and rulers, the Queen's 
 enemies, fire, and all and every other dangers and accidents of the 
 seas, rivers, and navigation, of whatever nature and kind soever, dur- 
 
694 IMPLJ.ED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 ing the said voyage, always excepted. The freight to be paid on un- 
 loading and right delivery of the cargo, one-third in cash, and the re- 
 mainder by an approved bill on Londcfrj, at three months' date. Thirty 
 working days are to be allowed, Sundays excepted, the said merchant 
 (if the ship is not sooner dispatched) for loading the said ship at Mar- 
 seilles, and unloading at the return port ; mats and bulk heads to be 
 
 found by the charterers, and dunnage by the ship, and — days on 
 
 demurrage, over and above the said laying days, at £4 per day ; the pen- 
 alty for the non-performance of this agreement, £400; the vessel to 
 be consigned to the freighter's agents at Marseilles; cash for usual 
 disbursements at Marseilles, free of interest and commission, but the 
 insurance bills of lading to be signed for more or less freight, without 
 prejudice ,to the charterparty. Per proc. Booker & Co. ; Thomas 
 Booker, jun. ; Ed. Ollive, Nephew, & Co.; John Aitkin, witness to 
 the signature of Messrs. Booker & Co., and of Messrs. Ed. Ollive & 
 Co. The commission on this charterparty is at £5 per cent., due ship 
 lost or not lost. The vessel to be addressed to Alexander Howden or 
 his agents, at the port of discharge." Arid the defendant avers, that 
 Upon the making of the said charterparty, time was an essential and 
 material part of the contract, and that the probable situation of the 
 vessel, with reference to the date of her sailing, was also a material 
 and essential part of the contract, to wit, with reference to the object 
 of the said voyage, and the distance of the said port of Marseilles, and 
 the nature of the said intended cargo, and the time of year at which 
 the said charterparty was made. And the defendant further says, 
 that, in point of fact, at the time of the making of the said charter- 
 party, the said vessel had not sailed three weeks before, but on the 
 contrary, had sailed at a materially and unreasonably later time, to 
 wit, one week later, which the plaintiff, at the time of the making of 
 the said charterparty, knew, and whereof the defendant had no notice 
 or knowledge, wherefore the defendant wholly declined to accept or 
 employ the said vessel under the said charterparty, to wit, immediate- 
 ly upon learning and knowing that the said vessel had not sailed, as in 
 the said charterparty set forth, to wit, upon the 1st of February, 1845, 
 and wholly neglected and refused to load any cargo on board her, to 
 wit, upon the day and year last aforesaid, as he lawfully might for 
 the cause aforesaid. Verification. 
 
 Replication, de injuria. 
 
 At the trial, at the sittings after last Hilary Term, before the Lord 
 Chief Baron, a verdict was found for the plaintiff upon all the issues, 
 except those raised by the 8th, 9th, and 11th pleas, and upon these 
 issues. the defendant had a verdict, — ^leave being reserved to the plain- 
 tiff to move to enter a verdict upon them also. 
 
 Crowder having obtaijied a rule nisi accordingly, and also for judg- 
 ment non obstante veredicto upon the eighth plea. 
 
 Watson and Greenwood now shewed cause. — The plaintiff is not 
 entitled to judgment non obstante veredicto upon the eighth plea. The 
 
Sec. 2) CHARTER PARTIES — LEASES 695 
 
 statement in the chartei-party, that the vessel was then at sea, and had 
 sailed three weeks, is an essential and most material part of the con- 
 tract, -and was not a mere collateral agreement, for the breach of 
 which an action should have been brought to recover any consequen- 
 tial damages. The defendant was not bound to complete his part of 
 the engagement, as this condition was not performed by the plaintiff. 
 The time at which a vessel sails is a most important matter in con- 
 tracts of affreightment. This is a term which forms the basis of the 
 contract. * * * 
 
 The term of the vessel's sailing is as much a condition of the char- 
 terparty as that she was staunch and strong. (They were then stop- 
 ped by the Court.) 
 
 Crowder and Bovill in support of the rule. This plea affords no 
 answer to the action. The statement in the charterparty, upon which 
 the plea is founded, is a mere representation, and not a condition. 
 The plaintiff might be liable for the breach of it in a cross ac- 
 tion. * * * 
 
 Parke, B.^' I am of opinion that the rule for judgment non obstante 
 veredicto on the eighth plea ought to be discharged. It seems to me 
 that the averment in the plea, that at the time of entering into the 
 charterparty the plaintiff knew that the vessel had sailed a materially 
 and unreasonably later time than that which was stipulated for, is an 
 immaterial averment, and might be struck out. The main question, 
 however, in the construction of this plea, is, whether the allegation in 
 the charterparty, of the vessel being "now at sea, having sailed three 
 weeks ago," is a warranty or a representation. In the construction of 
 agreements, as in the case of contracts under seal, we should en- 
 deavour to discover the intention of the parties. Here- it is stated 
 that the vessel was now at sea, having sailed three weeks ; and if time 
 is of the essence of the contract, no doubt it is a warranty and not a 
 representation. Such, also, is the case in policies of insurance. It 
 appears to me that it is a warranty, and not a representation, that the 
 vessel had sailed three weeks. It is, therefore, a condition precedent. 
 The rule depends upon -each particular contract, and here time was of 
 the essence of the contract, as much so as the statement that she was a 
 sound vessel. This being a condition precedent, and not performed, 
 the defendant was not bound to load the vessel, If he had loaded 
 her, the breach of the condition would have been waived, and he wouid 
 have been liable for the full freight.^* I entirely agree with the rea- 
 soning of Tindal, C. J., in the case of Glaholm v. Hays, which I think 
 applies to the present case. There the stipulation was held to be a 
 condition precedent. The defendant was entitled to say that he was 
 not bound to load the vessel, as the condition had not been performed, 
 
 1' The facts have been restated in part, the arguments abridged, and the 
 concurring opinions of Alderson and Rolfe, BB., omitted. 
 
 i«In accord: Pust v. Dowie, 32 L. J. Q. B. 179 (1864) ; Graves v. Legg, 
 9 Es. 717 (18S4), semhle. ' 
 
696 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 and that the case was the , same as if the vessel had not proved to be 
 A 1, as she was warranted to be. I think, therefore, that the plea af- 
 fords a good answer, and that the rule for judgment non obstante ver- 
 edicto ought to be discharged. 
 Rule discharged." 
 
 ANONYMOUS. 
 (In the Common Pleas, 1590. 4 Leon. 50, Case No. CXXX.) 
 
 A lease for years is made by deed indented rendering rent, and the 
 lessor covenants that the lessee paying his rent shall enjoy the land de- 
 mised for the whole term; the lessee did not pay the rent, and, after- 
 wards is ejected by a title paramount : by WalmEsly and Windham, 
 Justices, that the covenant is conditional, and that the lessee should not 
 have advantage of it, if he did nolf perform the condition, which is 
 created by this word (paying). Periam, Justice, was strongly to the 
 contrary, viz. that the word (paying) did not create a condition.^" 
 
 ixin accord: Behn v. Burness, 32 L. .T. Q. B. 204, 3 B. & S. 751 (1868), 
 ship represented to be "'now In the port of Amsterdam," when she was not; 
 Cranston v. Marshall, 5 Ex. 395 (1850) ; Croockewit v. Fletcher, 1 H. & N. 
 893 (1857) ; Glaholm v. Hays, 2 M. & G. 208 (1841), "the vessel to sail from 
 England on or before the 4th day of Feb." Other cases where time was of 
 the essence and delay fatal are Freeman v. Taylor, 8 Bing. 124 (1831) ; Oliver 
 V. Fielden, 4 Ex. 135 (1849) "to be launched and ready to receive cargo In 
 May"; Tully v. Howling (C. A.) 2 Q. B. D. 182 (1877). 
 
 In the following cases the nonperformance by one was held- not to go to the 
 essence of the charter party. Storer v. Gordon, 3 M. & S. 308 (1814) ; Fother- 
 gill V. Walton, 8 Taunton, 576 (1818) ; Clipsham v. Vertue, 5 Q. B. 265 (1843) ; 
 Tarrabochia v. Hickie, 1 H. & N. 183 (1856) ; Seeger v. Duthie, 29 L. J. C. P. 
 253, 30 L. J. (3. P. 65 (1860) ; McAndrew v. Chappie, L. E. 1 C. P. 643 (1866), 
 a slight deviation or delay. 
 
 In Eae v. Hackett, 12 M. & W. 724 (1844), where the defendant had agreed 
 to sail his ship to some safe port near Cape Town, it was held that the naming 
 of the port was a condition precedent to his duty to sail. 
 
 Delivery at Destination. — In charter parties delivery of the goods at destina- 
 tion is noEjnally a condition precedent to the duty to pay freight, and the 
 condition is not dispensed with by the fact that it is prevented by disaster, 
 war, blockade, pirates, prohibition of trade, or other force majeure. The 
 Isabella Jackson, 4 C. Bob. 77 (1801), leakiness, due to bad weather; The 
 Appam (D. C.) 243 Fed. 230 (1917), capture by enemy; The St. Helena, 
 [1916] 2 A. C. 625, outbreak of war made delivery in enemy port illegal ; Scott 
 V. Libby, 2 Johns. (N. Y.) .336, 3 Am. Dee. 431 (1807), blockade at port of 
 destination; Hunter v. Prinsep, 10 East, 378 (1803), cargo sold at Interme- 
 diate port, after wreck ; The Eliza Lines, 199 U. S. 119, 26 Sup. Ct. 8, 50 L. 
 Ed. 115, 4 Ann. Cas. 406 (1905), ship abandoned by peril of the sea and later 
 brought into port by salvors. 
 
 If the delivery at destination is prevented by the cargo owner, the shipowner 
 Is entitled to full freight. Jordan v. Warr.en Ins. Co., 1 Story, 353, Fed. Cas. 
 No. 7524 (1840). 
 
 A temporary blockade is not impossibility, and a ship thus delayed is not 
 bound at once to abandon the voyage and lose freight. Palnier v. Lorillard, 
 16 Johns. (N. T.) 3*8 (1819). 
 
 2 Where a lessee covenants to repair the premises, "the same being first 
 put into tenantable repair by the lessor," it has, been held that the tenant's 
 duty is conditional upon repair by the liessor. Neale v. RatclifC, 15 Q. B. 916 
 
Sec. 2) CHARTER PARTIES — PLEASES 697 
 
 POWELL V. MERRILL. 
 
 (Supreme Court of Vermont, 1918. 92 Vt. 124, 103 Atl. 259.) 
 
 Action by Max L. Powell against James A. Merrill. Judgment was 
 adverse to plaintiff and he brings exceptions. Affirmed. 
 
 Powers, J.''^ The plaintiff, by a writing under seal, rented to the 
 defendant a building in Burlington. The lease provided for a monthly 
 rent, authorized the lessee to sublet with the lessor's consent, required 
 the tenant to pay the water rates, and stipulated for a right of re-entry 
 for breach of its covenants. At some time during the term, the defend- 
 ant, with the plaintiff's permission, sublet a part of the premises to the 
 American Woolen Company, who occupied such part, undisturbed by 
 the plaintiff, until December 1, 1,913, when they paid to the defendant 
 the October and November, rent and vacated the premises. The defend- 
 ant continued to occupy that part pi the premises not so sublet until 
 November 15, 1913, on which day the plaintiff brought a suit against 
 him, seeking to recover therein rent in arrear under the lease and cer- 
 tain ofher items of indebtedness. He placed the writ in the hands of 
 an officer for service, and by his direction the latter went to the prem- 
 ises and attached certain personal property of the defendant there 
 found, and having ejected therefrom one Joseph Agel, who was in the 
 part occupied by the defendant by the latter's permission, placed a 
 padlock on the door and locked the defendant out. He did not interfere 
 with the' part occupied by the woolen company. Since that time, the 
 defendant has not been in possession of any part of the premises, or 
 had anything to do with them, except to receive the rent as above 
 stated. One-half of the rent so received he turned over to the plaintiff. 
 What became of the suit referred to, we do not know. Whether or not 
 it ever came to trial, and, if so, who finally prevailed, is not shown by 
 this record. 
 
 The suit before us is an action for rent on the premises from Novem- 
 ber 1, 1913, to March 1, 1914, on which day the plaintiff gave the de- 
 fendant a written release from further liability. The defendant filed 
 several pleas, but the transcript shows that the case was tried below 
 without regard to them. Judgment was rendered for the plaintiff to 
 recover rent from November 1 to Noveniber IS, 1913, only, and the 
 plaintiff excepted. 
 
 The defendant contends that the acts of the officer, done by direction 
 of the plaintiff, amounted to an eviction of him from a substantial part 
 of the premises, and that as a result, his obligation to pay rent was 
 entirely suspended. But an eviction may be rightful or wrongful. 1 
 R. & L. Diet. 467. The term is commonly used in the books as denot- 
 
 (1850) ; Slater v. Stone, Cro. Jac. 645 (1622). Contra: Bragg v. Nightin- 
 gale, 1 RoUe, Abr. 416, pi. 15 (1649). 
 ^^ Part of the opinion is omitted. 
 
698 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT (Ch. 4 
 
 ing a wrongful ouster of the tenant by the landlord, and is so used in 
 this opinion. It is established beyond controversy that an eviction by 
 act of the landlord, in order to have the effect contended for by the 
 defendant, must result from a wrongful act of the landlord. "Eviction, 
 properly so called," says Mr. Justice Crowder in the much-cited case 
 of Upton V. Townend, 84 E. C. L,. 70, "is a wrongful act of the land- 
 lord, which operates the expulsion or amotion of the tenant from the 
 land." 
 
 The rule invoked by the defendant is thus stated by Lord Hale in 
 Hodgkins v. Robson, 1 Ventr. 276 : "If the lessor enters into part by 
 wrong, this shall suspend the whole rent ; for in such case, he shall not 
 so apportion his own wrong as to enforce the lessee to pay anything 
 for the residue." To the same effect are the American authorities: 
 Shumway v. Collins, 6 Gray (Mass.) 232 ; Mirick v. Hoppin, 118 Mass. 
 582; Skally v. Shute, 132 Mass. 367; Galleher v. O'Grady, 78 N. H. 
 343, 100 Atl. 549. So unless the acts of the landlord are wrongful, 
 although they permanently deprive the tenant of the use of the demised 
 premises, no eviction is committed (note^to'38 Am. St. Rep. at page 
 487), and a rightful re-entry does not evict (Wright v. Everett, 87 
 Iowa, 697, 55 N. W. 4). 
 
 So the first question for determination is. Was this plaintiff's re- 
 entry — for that is what it amounted to — rightful or wrongful? The 
 common-law rules regulating the rights of landlord and tenant are 
 highly technical and strictly adhered to. Forfeitures are not. favored 
 by the law, and stipulations therefor are construed strictly. The mere 
 breach of a covenant contained in the lease does not in the absence of 
 special stipulation, work a forfeiture of the term or give the landlord 
 a right of re-entry. But the lease before us contains a provision that, 
 if the lessee should "at any time for the space of one month refuse or 
 neglect to fulfill the conditions of this lease, then the said Powell 
 shall have the right to enter into and upon the premises to take posses- 
 sion thereof and order out the said Merrill." The plaintiff invokes this 
 clause and insists upon three grounds as justifying his re-entry there- 
 under, default in payment of rent, subletting to Agel without consent, 
 and nonpayment of water rates. 
 
 As we have seen, without the clause referred to, the plaintiff had no 
 right to re-enter. Under the clause his rights are stricti juris, and no 
 more than the covenant gives him. Unless one or more of the covenants 
 were at that time broken, and, in view of the term of grace specified, 
 had remained broken for one month, no right of re-entry existed on 
 November 15, 1913. 
 
 The findings do not directly show that there was any rent then over- 
 due. The nearest that they came to it is that (as we shall see) at some 
 time or other the defendant agreed or offered to pay what rent was due. 
 The findings also fail to show that any part of the premises were sub- 
 let to Agel. They show he was there by permission of the defendant. 
 
Sec. 2) CHARTER PARTIES — LEASES 699 
 
 but nothing more. Nor do the findings show that these defaults, if 
 such they were, or either of them had existed for one month before that 
 date. It is found that the defendant failed to pay certain water rates, 
 but whether this failure was a month before the re-entry is not shown. 
 So the plaintiff fails to show by the record that his right to enter and 
 oust the defendant had accrued when he sent the officer to the prem- 
 ises with the writ. 
 
 The plaintiff insists that he only intended to make an attachment and 
 not evict the defendant when he sent the officer there, and he complains 
 because he was not allowed to show this. It is true that in speaking 
 of this kind of an eviction it is frequently said that the character of the 
 landlord's act depends on his intention. And so it does ; but the land- 
 lord will be presurned to intend the natural consequences of his acts 
 (16 R. C. L. 688), and where, as here, his acts necessarily result in de- 
 priving the tenant of the beneficial enjoyment of the premises or a sub- 
 stantial part of them, the intent to oust the tenant will be conclusively 
 presumed (Id. ; Skally v. Shute, 132 Mass. 367 ; Tallman v. Murphy, 
 120 N. Y. 345, 24 N. E. 716). 
 
 The rule contended for by the defendant that an. eviction from a 
 part of the premises suspends the rent in its entirety is established by 
 the great weight of authority not only in England but in this country. 
 Mirick v. Hoppin, 118 Mass. 582; Fifth Ave. Bldg. Co. v. Kernochan, 
 221 N. Y. 370, 117 N. E. 579 ; Kuschinsky v. Elanigan, 170 Mich. 245, 
 136 N. W. 362, 41 L. R. A. (N. S.) 430, and note, Ann. Cas. 1914A, 
 1228. * * * 
 
 Affirmed." 
 
 2 2 What would have been the court's decision as to the rent had the eviction 
 been rightful? 
 
 In Tracy v. Albany Exchange Co., 7 N. Y. 472, 57 Am. Dec. 538 (1852), an 
 action for damages for breach of a covenant to renew a lease, the court said : 
 "As to the objection made by the defendant that there was rent in arrear, 
 and therefore the plaintiff was not entitled to a further lease, the covenant 
 being independent, the liability of the defendant for the breach of the cove- 
 nant in question remained. The payment of the rent was not a condition 
 precedent to the right of the plaintiff to a, renewal of the lease under the 
 covenant, and he nright bring his action for a breach of it, although he was 
 guilty of a default in the payment of his rent or performance of his covenant. 
 Dawson v. Dyer, 5 Bam. & Ad. 584 (1833)." 
 
 In Friar v. Grey, 5 Ex. 584 (1850), it was provided in a lease that the 
 tenant should have the power of terminating the lease after eight years by 
 giving 18 months notice, "all arrears of rent being paid." The failure to pay 
 rent went to only part of the consideration, but Manisty (of counsel) argued 
 that the principle applicable to mutual covenants (see Boone v. Eyre, ante, 
 p. 533) is not applicable in the case of ''a power dependent on a condition." 
 The court held that payment of the rent was a condition precedent to the 
 power. 
 
 In Edge V. Boileau, 16 Q. B. D. 117 (1885), the action was by the tenant 
 for breach of a covenant for quiet enjoyment, "to the effect that the lessee 
 paying the rent when due, and observing the covenants on his part to be 
 observed, should peaceably and quietly hold and enjoy." Judgment was given 
 for the tenant, in spite of the fact that rent was in arrears and that he had 
 not repaired as agreed. It was held by Pollock, B., Manisty, J., concurring, 
 
700 IMPLIED AND CONSTRUCTIVE CONDITIONS PRECEDENT ,(Ch. 4 
 
 GASTON V. GORDON. 
 (Supreme Judicial C!ourt of Massachusetts, 1911. 208 Mas^. 265, 94 N. E. 307.) 
 
 Action by William A. Gaston, trustee, against Isaac Gordon. Ver- 
 dict was directed for plaintiff, and defendant excepted. Exceptions 
 overruled. 
 
 RuGG, J. This is an action of contract to recover rent reserved in a 
 written lease. The facts are not in controversy. The defendant, hop- 
 ing to secure a license to sell intoxicating liquors upon the demised 
 premises, executed with tlie plaintiff under date of November 15, 
 1907, a lease for a term of three years from February 1, 1908, which 
 contained a covenant that he would "use the said premises solely for 
 the following purposes: For the retail liquor business," and would 
 not "use said premises or any part thereof for any purpose other than 
 those stated in this lease, nor for any purpose * * * which shall 
 be unlawful * * * or contrary to any law, ordinance or by-law." 
 In the latter part of 1907 an application for a license for the sale of 
 intoxicating liquors on the premises was made by the defendant to the 
 licensing board, and it was refused. Thereupon the defendant gave 
 notice to the plaintiff, did not enter occupation under the lease, and 
 refused to pay rent. * * * ^* 
 
 2. The defendant contends that it is an implied condition of the en- 
 tire lease that the lessee shall be able to procure a license, and if he 
 fails he shall not be bound. The lease is plain that the premises can 
 be used for nothing else than the liquor business, except ^ith the as- 
 sent in writing of the lessor. It follows that without a license the les- 
 see can make no use of them, except by consent of the lessor. Stew- 
 art V. Winters, 4 Sandf. Ch. (N. Y.) 587; Spalding Hotel Co. v. 
 Emerson, 69 Minn. 292, 72 N. W. 119; Maddox v. White, 4 Md. 72. 
 59 Am. Dec. 67; Wertheimer v. Circuit Judge, 83 Mich. 56-62, 47 
 N. W. 47. There is nothing about the lease to raise the inference that 
 the parties intended it to be subject to an implied condition that the 
 defendant should procure a license.. On the contrary, there is much 
 to lead to the opposite conclusion. It is elaborate in all its details. 
 It expresses the rights of the parties in the event of damage to or de- 
 struction- of the property by fire or unavoidable casualty or its taking 
 by eminent domain, and for the possible termination of the- lease under 
 these circumstances. There is also a stipulation as to its termination 
 in the event of bankruptcy, insolvency or assignment for benefit of 
 
 that the covenants were mutual and independent. See, to the same effect, 
 Leavitt v. Fletcher, 10 Allen (Mass.) 119 (1865), where the lessee's ■ promise 
 to pay rent was said to be independent of the lessor's promise to keep in repair, 
 and the lessee was held entitled to damages, for breach of the duty to repair, 
 even though he had been ejected *or failure to pay rent. 
 
 23 The court here denied the contention of the defendant that the lease was 
 void because it required the performance of an illegal act. It did not require 
 the defendant to sell liquor. 
 
Sec. 2) CHARTER PARTIES — LEASES 701 
 
 creditors by the lessee, and by notice in writing at any time after 
 January 31, 1910. The lease s,eems to be a studied effort to put 
 into written phrase every consideration which was a part of their 
 agreement. It was apparently an intelligent attempt to express 
 their contract in such a way and with such fullness that nothing 
 could be left uncertain. It must have been within the thought and 
 contemplation of the parties that the lessee would be obliged to 
 get a license not only once but each year of the term of the lease 
 in order to make the required use of the premises. The lease binds 
 the heirs, the assigns and legal representatives of both the lessor 
 and the lessee. Yet it is plain that if a license had been granted 
 to the lessee, it is such a personal privilege that had he died before its 
 expiration, it would have been extinguished, and the liquor business 
 could not have been carried on except under a new license. But by 
 the express terms of the lease rent would still have been due. The in- 
 ference is unavoidable that if it had been their intention* to make this 
 whole instrument dependent upon the granting of a license to the les- 
 see, a clause to that end would not have been omitted. 
 
 The lessee has bound himself in unmistakable language to pay the 
 rent without any qualification dependent upon his failure to obtain the 
 necessary authority from public ofikers. Although this mischance 
 renders it impossible for him to make the valuable use of the property 
 which was contemplated, that was a contingency which ought to have 
 been foreseen, and some anticipatory provision of partial or entire ex- 
 oneration from liability inserted in the lease if such was the intention 
 of the parties. There appears to be no more reason to imply such 
 condition in this lease than to say that the burning of a building ends 
 a lease of land and buildings. Yet nothing is better settled in the law 
 of landlord and tenant than that in the absence of special stipulation, 
 there is no abatement of rent in case a building upon leased premises 
 is ruined by fire. Fowler v. Bott, 6 Mass. 63 ; Davis v. Alden, 2 
 Gray, 309; Roberts v. Lynn Ice Co., 187 Mass. 402-407, 73 N. E. 
 523. The reason for this rule is that an express and unqualified ob- 
 ligation voluntarily incurred ought to be enforced. Casualties not pro- 
 vided for in such a contract must be pr£sumed to have been omitted 
 intelligently and intentionally. The fact that by reason of the refusal 
 of the public board to act favorably to the defendant, for which the 
 landlord is in no wise responsible, the value of the estate to the tenant 
 has been greatly diminished will not excuse him from performing 
 what is required of him. Pratt v. Grafton Electric Co., 182 Mass. 
 ISO; 65 N. E. 63 ; Houston I. & B. Co. v. Keenan, 99 Tex. 79, 88 S. 
 W. 197; Goodrum Tobacco Co. v. Potts-Thompson Liquor Co., 133 
 Ga. 776, 66 S. E. 1081, 26 L. R. A. (N. S.) 498. 
 
 3. The testimony of conversation occurring before the execution 
 of the, lease between the plaintiff's agent and the defendant, so far as 
 not wholly immaterial, was properly excluded, under the familiar rule 
 that when parties have put their contract in writing in unambiguous 
 
702 OPEEATION OF CONTRACT (Ql. 4 
 
 terms, previous or contemporaneous conversations or agreements re- 
 specting the same subject are inadmissible to vary its terms. The 
 writing is conclusively presumed to express the contract. Com. Trust 
 Co. V. Coveney, 200 Mass. 379, 86 N. E. 895 ; Buttrick Publishing Co. 
 v. Fisher, 203 Mass. 122-132, 89 N. E. 189, 133 Am. St. Rep. 283 ; 
 Perry v. J. L. Mott Iron Works, 207 Mass. 501, 93 N. E. 798; Jen- 
 nings V. Puffer, 203 Mass. 534, 89 N. E. 1036. 
 
 4. The execution and delivery of the lease being admitted, there 
 was no question of fact to be submitted to the jury. This is not a case 
 where different inferences might have been drawn from undisputed 
 facts. The only correct conclusion possible as matter of law was that 
 the plaintiff was entitled to recover. Hence the verdict was rightly 
 directed. 
 
 Exceptions overruled. 
 
 SECTION 3.— CONDITIONS SUBSEQUENT— PLEADING 
 AND BURDEN OF PROOF OF CONDITIONS 
 
 CHAMBERS v. ATLAS INS. CO. 
 (Supreme Court of Errors of Connecticut, 1883. 51 Conn. 17, 50 Am. Rep. 1.) 
 
 PardEB, J. The plaintiffs took from the defendant a policy of in- 
 surance against loss by fire, to be in force from January 1st to Decem- 
 ber 31st, 1881. On September 1st of that year the property covered 
 by it was injured by fire. The plaintiffs instituted this suit for the re- 
 covery of damages. The defendant demurred and had judgment; the 
 plaintiffs appeal. 
 
 The policy contains the following provisions: — "Paynient of losses 
 shall be due in sixty days after the proofs required by this company 
 shall have been received at this office, and the loss shall have been sat- 
 isfactorily ascertained and proved as required by the foregoing pro- 
 visions of this policy. It is furthermore hereiby expressly provided that 
 no suit or action of any kind against this company, for the recovery of 
 any claim by virtue of this policy, shall be sustainable in any court, 
 unless such suit or action shall be commenced within the term of twelve 
 months ^ext after any loss or damage shall occur ; and in case any such 
 suit or action shall be commenced against this company after the expi- 
 ration of twelve months next after such loss or damage shall have oc- 
 curred, the lapse of time shall be taken and deemed as conclusive evi- 
 dence against the validity of the claim thereby so attempted to be en- 
 forced. * * * This policy is made and accepted upon the above 
 express conditions; no part thereof can be waived except in writing 
 signed by the secretary." 
 
Sec. 3) CONDITIONS SUBSEQUENT 703 
 
 Proof of loss was made on September 14th, 1881. This suit was in- 
 stituted on November 11th, 1882. It is the claim of the plaintiffs that 
 they may institute their suit within the twelve months next after the 
 expiration of sixty days from proof of loss, that is, next after Novem- 
 ber 14th, 1881. It is the claim of the defendant that they must in- 
 stitute it within the twelve months next after the fire. 
 
 This limitation is lawful and reasonable. In words in common use 
 and of plain meaning an event is referred to as a starting point ; that 
 is, the destruction of, or injury to, the plaintiffs' property by fire. It 
 is certain that they intended to surrender a very large portion of the 
 time allowed them by the law ; and there is nothing either in the struc- 
 ture or subject-matter of the contract indicating their unwillingness to 
 make the day of that occurrence the point of departure, and to agree 
 that the period of twelve months therefrom should cover the making of 
 <-he proofs, the sixty days of grace to the defendant, and the institution 
 of a suit. 
 
 The contract keeps the day upon which a fire shall occur entirely dis- 
 tinct from the day upon which the right to sue for indemnity accrues ; 
 each is described in plain and appropriate language. We find no rea- 
 son for the assumption that when the first is mentioned the last is in- 
 tended ] and it is not for us, by construction, to give the plaintiffs what 
 they failed to secure by 'agreement. 
 
 There is no error in the judgment complained of. 
 
 In this opinion the other judges concurred.''* 
 
 NORTHWESTERN NAT. UFE INS. CO. v. WARD. 
 (Supreme Court of Oklahoma, 1916. 56 Okl. -188, 155 Pac. 524.) 
 
 Action by Rebecker Ward against the Northwestern National Life 
 Insurance Company. Judgment for the plaintiff, and defendant brings 
 error. Affirmed. 
 
 "^A similar case is Semmes v. Hartford Ins. Co., 13 Wall. 158, 20. L. Ed. 
 490 (1871), where it was further held that the breaking out of the Civil War, 
 making the bringing of a suit within the 12 months almost impossible, nulli- 
 fied the condition altogether. Observe that the condition subsequent, terminat- 
 ing the insurer's duty to pay, was the not bringing of the suit in 12 months. 
 This was rendered inevitable, not impossible, by the war. The same was held 
 in Scovill -v. McMahon, 62 Conn. 378, 26 Atl. 479, 21 L. R. A. 58, 36 Am. St. 
 Rep. 350 (1892), where land was conveyed on condition to revert to the 
 grantor when no longer used as a cemetery, and later the Legislature forbade 
 its use for that purpose. 
 
 In Colony State Bank v. Watson, 104 Kan. 3, 177 Pac. 544 (1919), a fidelity 
 bond provided "that no claim should be payable that shall be filed with the 
 company after the period of six months from the expiration of the service." 
 
 Read V. State Ins. Co., 103 Iowa, ^307, 72 N. W. 665, 64 Am. St. Rep. 180 
 (1897), held that the six months period begins with the making proof of loss 
 and not with the occurrence of the loss itself. Conflicting cases are cited 
 pro and con. 
 
704 OPERATION OF CONTEACT (Ch. 4 
 
 Wilson, C.*" Defendant in error, as plaintiff, commenced this ac- 
 tion against the plaintiff in error, as defendant, to recover on a cer- 
 tain life insurance policy written on the life of Coleman A. Ward, 
 her husband. Plaintiff's petition was filed on March 16, 1909, and al- 
 leged that the insured, Coleman A. Ward, died on the 1st day of Au- 
 gust, 1907, that being more than one year before the commencement of 
 the action. One of the provisions of the policy sued on is that: "No 
 suit at law or action in equity shall be brought to recover on this poli- 
 cy after one year from the actual date of the death of the insured, and 
 if such suit be brought after such period of one year the lapse of time 
 shall be a conclusive bar thereto, any statute or law to the contrary 
 notwithstanding." 
 
 The defendant filed its answer to plaintiff's petition, in which it set 
 out the above-quoted provision of the polidy, alleged the same to have 
 been a condition precedent to liability thereon, and pleaded the fact 
 that the action was commenced more than one year after the actual 
 death of the insured as one of its defenses. Upon defendant's answer 
 being filed the plaintiff filed her reply thereto, in the second paragraph 
 of which she admitted the clause referred to, and that the action was 
 not commenced within the year, but alleged that during the year fol- 
 lowing the death of the insured, and up to within three months of the 
 date of the filing of her suit, she and the defendant were attempting 
 to negotiate a settlement; that the defendant, during said time, made 
 different propositions of settlement and compromise, and by its long 
 course of conduct and many assurances of settlement induced the 
 plaintiff to believe that the matter would be settled and adjusted with- 
 out litigation ; that but for such conduct and assurances of settlement 
 by the defendant the plaintiff would have instituted suit on the policy 
 within the time limit of one year, and that by such conduct the de- 
 fendant was estopped' from availing itself of such provision of the 
 policy, and wholly waived the same. Upon the reply being filed the 
 defendant moved the court to strike therefrom all the allegations hav- 
 ing reference to such waiver, for the reason that they were inconsist- 
 ent with the allegations of plaintiff's petition and constituted a de- 
 parture therefrom. This motion was overruled by the court, which 
 action was excepted to at the time and constitutes one of the alleged 
 errors assigned by the defendant in its petition in error and urged in 
 its brief. * * * 
 
 Therefore, in consideration of the foregoing, the first question 
 which arises for our decision is : Do the allegations of the second par- 
 agraph of plaintiff's reply constitute a departure from the allegations 
 of her petition? A departure in pleading is defined in the seventh 
 volume of the Standard Encyclopedia of Procedure, page 117, as: 
 "The abandonment of one ground of action or defense asserted in one 
 pleading and the substitution of some other ground or defense in » 
 subsequent pleading." 
 
 2 6 Part of the opinion is omitted. 
 
Sec. 3) CONDITIONS SUBSEQUENT 705 
 
 Under the established practice of this state a departure in pleading 
 by alleging in a reply facts materially inconsistent with the facts al- 
 leged in the petition will not be permitted when the objection is prop- 
 erly taken advantage of by a motion to strike the objectionable matter 
 from the reply. St. Paul Fire & Marine Insurance Co. v. Mountain 
 Park Stock Farm Co., 23 Okl. 79, 99 Pac. 647; Merchants' & Plant- 
 ers' Ins. Co. V. Marsh, 34 Okl. 453, 125 Pac. 1100, 42 L,. R. A. (N. 
 S.) 996. 
 
 A reply filed in an action to recover on an insurance policy which 
 admits the nonperformance of a condition precedent and sets up facts 
 to show that the performance of such condition precedent had been 
 waived, when the petition in the action had affirmatively alleged that 
 such conditions precedent had been performed, is a departure from 
 the cause of action alleged in the petition (St. Paul Fire & Marine 
 Ins. Co. v. Mountain Park Stock Farm Co., supra; Merchants' & 
 Planters' Ins. Co. v. Marsh, supra), but a like manner of pleading 
 does not constitute a departure when the conditions involved are what 
 is known as "conditions subsequent" or promissory warranties. West- 
 em Reciprocal Underwriters' Exchange v. Coon, 38 Okl. 453, 134 
 Pac. 22. 
 
 A condition precedent of a contract is one which calls for the per- 
 formance of some act or the happening of some event after the con- 
 tract is entered into and upon the performance or happening of which 
 its obligations are made to depend. R. C. L. title. Contracts, § 290, 
 p. 904.^« 
 
 A condition subsequent of a contract is one which follows the per- 
 formance of the contract and operates to defeat or annul it upon the 
 subsequent failure of either party to comply with the condition. R. 
 C. L. title. Contracts, § 291, p. 906. 
 
 The stipulation or condition of the policy sued on in this case that 
 an action could not be brought to recover on the policy after one year 
 from the actual date of the death of the insured was one which, in 
 its very nature, could not prevent the accrual of a right to recover on 
 the policy, and consequently was not a condition precedent of the pol- 
 icy, but was a limitation on the beneficiary's right to sue at law or in 
 equity after her right to do so had accrued, and was in the nature of 
 a condition subsequent, although not strictly so, which did not defeat 
 or annul the policy, but placed a time limitation on the right to en- 
 force payment of any amount to come due on the same, in the absence 
 of a waiver or estoppel. 
 
 The clause in question, which prohibited suit on the policy being 
 brought after a year from the date of the death of the insured, was 
 not averred in the petition or set out in the exhibit thereto, and it was 
 not necessary for the plaintiff to do so to state a cause of action, for 
 
 2 9 Conditions precedent and subsequent are distinpruished in Adams v. 
 Guyandotte Val. Ry. Co., 64 W. Va. 181, 61 S. E. 341 (1908). 
 
 COEBIN CONT. 45 
 
706 OPERATION OF CONTRACT (Ch. 4 
 
 while it was a part of the contract, it was a provision which in no way 
 affected the liabiHty, but related only to the enforcement. It was one 
 wholly for the benefit of the insurer, and could be waived, and, if not 
 waived and suit was brought to recover on the policy after the ex- 
 piration of the time limit, that fact could have been and was pleaded 
 in defense of the action, and the plaintiff's plea of facts, by way of 
 reply, which tended to establish a waiver or an estoppel, was a prop- 
 er plea and did not constitute a departure. Fred Miller Brewing Co. 
 V. Capital Ins. Co., Ill Iowa, 590, 82 N. W. 1023, 82 Am. St. Rep. 
 529. • 
 
 It is next urged that the waiver contended for by the plaintiff was 
 not sufficient to bind the defendant and to^ constitute an excuse for 
 noncompliance with that provision of the policy which limited the 
 time within which suit could be commenced thereon to one year after 
 the death. That was a harsh provision, inserted in the policy for the 
 benefit of the insurance company and was one which unquestionably 
 could be waived and it only remains to be determined whether the evi- 
 dence offered was competent and sufficient to sustain the plaintiff's 
 claim of estoppel or waiver. 
 
 The policy sued on contains this provision: 
 
 "No agent shall have power to alter or change in any way the 
 terms of this contract, to extend credit, to waive forfeiture, or to 
 write any thing upon the policy. No alteration or waiver of any of 
 the terms of this policy shall be valid unless in writing and signed by 
 the president and one other officer of the company, it being understood 
 that the powers of the president herein stated shall not be delegated." 
 
 This, too, was a provision of the policy inserted by the insurer for 
 its own benefit, and should not be given a broader or more extended 
 meaning than should be reasonably attributed to the language used, 
 and in determining the bearing it should have on the determination of 
 this case we think the word "waiver" as it is therein used should not 
 be given that broad and inclusive meaning, synonymous with "estop- 
 pel," in which sense it is sometimes carelessly used in reports and by 
 text-writers. 
 
 A distinction is drawn between waiver and estoppel when the two 
 doctrines are discussed in their purely technical aspect. Waiver in- 
 volves the notion of an intention entertained by the holder of some 
 right to abandon- or relinquish, instead of insisting on, the right. An 
 estoppel arises when the purpose or natural consequence of a person's 
 representations or conduct is such as to induce another person to do 
 or to omit some act, the doing or omission of which would turn out to 
 his detriment and to the inducing party's benefit if the latter were per- 
 mitted to take such advantage of it, and such an estoppel more often 
 carries with it the implication of fraud than waiver does. Fairbanks, 
 Morse & Co. v. Baskett, 98 Mo. App. 53, 71 S. W. 1113. 
 
 Waiver is the voluntary surrender of a right ; estoppel is the inhi- 
 bition to assert a right which the law places on one as a consequence 
 
Sec. 3) CONDITIONS SUBSEQUENT. 707 
 
 of his own conduct which has resulted in injury or detriment to an- 
 other. Libby V. Haley, 91 Me. 331, 39 Atl. 1004. 
 
 "Waiver belongs to the family of estoppel in a sense, and yet an es- 
 toppel * * * has connections that are no kin to waiver. Waiver 
 depends upon what one himself intends to do ; estoppel depends rath- 
 er upon what he caused his adversary to do." 
 
 "Estoppel results from an act which may operate to the injury of 
 the other party; waiver may affect the opposite party beneficially." 
 Kennedy v. Manry, 6 Ga. App. 816, 66 S. E. 29." * * * 
 
 BENANTI v. DELAWARE INS. CO. 
 
 (Supreme Ciourt of Erroi-s of Connecticut, 1912. 86 Conn. 15, 84 Atl. 109, 
 Ann. Cas. 1013D, 826.) 
 
 Action by Giro Benanti against the Delaware Insurance Gompany. 
 From a judgment for plaintiff, defendant appeals. Error, and new 
 trial ordered. 
 
 ' Wheeler, J."^ The answer sets up that the policy prbvided : "This 
 entire policy shall be void if the insured has concealed or misrepresent- 
 ed in writing or otherwise, any material fact or circumstance concern- 
 ing this insurance, or the subject thereof, or if the interest of the in- 
 sured in the property be not truly stated therein, or in case of any 
 fraud or false swearing by the insured touching any matter relating to 
 this insurance, or the subject thereof, whether before or after the 
 loss." And that "this entire policy * * * shall be void * * * 
 if the interest of the insured be other than unconditional and sole own- 
 ership." And that the plaintiff both before and after the loss false- 
 ly stated the value of the stock which was the subject of the loss, and 
 made other false statements as to the amount of the loss, all of which 
 statements were known by the plaintifiE to be false. And that the 
 plaintiff did not truly state his interest when the insurance was effect- 
 ed ; on the contrary, he stated that he was the sole and exclusive own- 
 er of the property insured when he had a partner who, as such, had a 
 part ownership in the property insured. 
 
 The defendant complains of the charge of the court that the issue 
 of false statements made subsequent to the issuance of the policy con- 
 cerning the value of the property insured and the amount of the loss 
 was an afifirmative defense raised by the defendants upon whom rested 
 the burden of proving it. The defendant insists that, as the burden of 
 proving compliance with the terms and conditions of the policy was 
 on the plaintiff, he assumed the burden of this issue as one of the 
 
 "'' The court then held that the conduct of the defendant's agents had been 
 such as to constitute an estoppel. The condition subsequent was thus nullified. 
 See, also, Hansell-Elcock Co. v. Frankfort Marine Accident & Plate Glass Ins. 
 Co., 177 ni. App. 500 (1913). 
 
 2* Part of the opinion is omitted. The error found was on a matter not 
 now under consideration. 
 
708 Operation of conteact (Ch. 4 
 
 terms of the policy. This stipulation was a condition subsequent, a 
 breach of which is a defense. It is no part of an insured's duty to 
 negative a condition subsequent. The authorities are practically agreed 
 in holding that the burden of proving the fraud is on the insurer. 
 "It is expressly provided thait, if there appear any fraud or false 
 swearing, the insured shall forfeit all claim under the policy. It is 
 believed that an averment, that the plaintiff had practiced no fraud 
 nor swore falsely, would sound rather oddly in the ears of a special 
 pleader." Lounsbury v. Protection Ins. Co., 8 Conn. 459, 467, 21 
 Am. Dec. 686; Jones Mfg. Co. v. Manufacturers' M. Fire Ins. Co., 8 
 Cush. (Mass.) 82, 54 Am. Dec. 742 ; Moody v. Ins. Co., 52 Ohio St. 
 12, 38 N. E. 1011, 26i L. R. A. 313, 49 Am. St. Rep. 699; Schaefier 
 V. Anchor M. F. Ins. Co., 113 Iowa, 652, 656, 85 N. W. 985 ; Friedman 
 Co. V. Atlas Ins. Co., 133 Mich. 212, 94 N. W. 757; Slocovich v. Ins. 
 Co., 108 N. Y. 56, 14 N. E. 802 ; Western Assur. Co. v. Mohlman, 83 
 Fed. 811, 28 C. C. A. 157, 40 I^, R. A. 561; Briefs on Insurance, 3 
 Cooley, § 151 ; Briefs on Insurance, 4 Cooley, §§ 3424, 3432, and cases 
 cited. 
 
 Another error assigned is the instruction that under the circumstanc- 
 es of this case there was no burden of proof on the plaintiff as to the 
 charge of his misstatement of his title, The representation as to title 
 was made prior to the issuance of the policy and was a condition 
 precedent to the attaching of the risk. As to all conditions precedent 
 the plaintiff sustains the burden of proof. Hennessy v. Metropolitan 
 Life Ins. Co., 74 Conn. 699, 52 Atl. 490; Vincent v. Mutual Reserve 
 Fund Life Ass'n, 77 Conn. 281, 287, 58 Atl. 963. Because of, the prac- 
 tical inconvenience of compelling proof of all of the conditions pre- 
 cedent in a policy of insurance, the plaintiff under our rule may, upon 
 proof of his interest, the issuance of the policy to him, the loss and 
 compliance with the proofs of loss, rest upon the legal presumption 
 that these conditions are prima facie established and the case made out. 
 Thereupon tlie defendant may offer its proof of the several breaches 
 which it may have pleaded, and these the plaintiff may, in turn, rebut. 
 This burden of proof never shifts. Upon the whole evidence it is 
 where it was at the beginning, upon the plaintiff, to prove his compli- 
 ance with the terms and conditions precedent of the policy. The plain- 
 tiff sustains this burden as to the conditions not specifically put in issue 
 by the defense by proof of his interest, the issuance of the policy to 
 him, the loss, and his compliance with the proofs of loss ; as to those 
 put in issue by the defense he sustains the burden by proof as in any 
 case. The trial court, in effect, so instructed the jury. In so doing it 
 followed our practice and our settled rule. Hennessy v. Metropolitan 
 Ivife Ins. Co., supra; Vincent v. M.utual Reserve Life Ass'n, su- 
 
 ■f-i*»p 2 9 •)• 'f- N* 
 
 28 In New Jersey, by statute, a general allegation of performance by the 
 plaintitf is sufficient, and the defendant must specify the particular conditions 
 precedent the fulfillment of which he wishes to deny. Board of Education of 
 
Sec. 3) CONDITIONS SUBSEQUENT 709 
 
 McGOWIN V. MENKEN. 
 
 (Court of Appeals of New York, 1918. 223 N. Y. 509, 119 N. B. 877 5 A 
 
 L. R. 794.) 
 
 Submission of controversy under Code Civ. Proc. §§ 1279-1281, 
 between Andrew C. McGowin, as administrator of Frank B. Tesson' 
 deceased, and S. Stanwood Menken, as administrator of Alice E. Tes- 
 son, deceased. Judgment for the former (177 App. Div. 841, 164 N. 
 Y. Supp. .953), and the latter appeals. Affirmed. 
 
 McLaughlin, J. Frank B. Tesson and his wife, Alice E., were lost 
 at sea on the 7th of May, 1915, when the Eusitania was sunk. At the 
 time of- his death he held three policies of insurance upon his life, 
 issued by the Equitable Life Assurance Society of the United States, 
 each payable, upon his death, to his widow, if living ; if not, then to 
 his executors, administrators, or assigns, with the right on his part to 
 change the beneficiary if he so desired. The respective administrators 
 of the estates of M'r. and Mrs. Tesson claimed the proceeds of these 
 policies. The Assurance Society, desiring to be relieved from liability, 
 paid the money into court, and the administrators thereupon, upon 
 an agreed statement of facts, submitted their respective claims to the 
 Appellate Division, which held that Mr. Tesson's administrator was 
 entitled to such fund. Judgment was rendered to this effect, from 
 which Mrs. Tesson's administrator appeals to this court. 
 
 In case of the death of two or more persons in a common disaster, 
 there is no presumption either of survivorship or simultaneous death. 
 Newell V. Nichols, 75 N. Y. 78, 31 Am. Rep. 424; St. John v. Andrews 
 Institute, 117 App. Div. 698, 102 N. Y. Supp. 808, affirmed, 191 N. Y. 
 254, 83 N. E. 981, 14 Ann. Cas. 708. In the submission the parties 
 agreed it cannot be proved which one survived the other. Under such 
 circumstances, by the express terms of ^ the policies, the proceeds be- 
 long to the husband's estate. Mrs. Tesson's right thereto depended 
 upon her surviving her husband. The provision in each policy is that 
 the society will pay, upon receiving proof of the death of Mr. Tesson, 
 "$5,000 * * * to his wife, Alice E. Tesson, if Hving; if not, then 
 to the assured's executors, administrators, or assigns." Survivorship 
 of. the wife, therefore, was a condition precedent to her taking. Had 
 her administrator brought an action against the society, he would have 
 
 City of WUdwood v. Kichmond Const. Co., 92 N. J. Law, 496, 105 Atl. 220 
 (1918). 
 
 Insurance policies always expressly except certain risks. The burden of 
 alleging and proving that the loss was caused by one of these excepted matters 
 is generally put on the defendant insurer, though this Is often not easy to 
 justify. See Moody v. Amazon Ins. Co., 52 Ohio St. 12, 38 N. E. 1011, 26 L. 
 R. A. 313, 49 Am. St. Rep. 699 (1894) ; -Red Men's Fraternal Ace. Assn. v. 
 RIppey, 181 Ind. 454, 103 N. E. 345, 104 N. E. 641 (1913), and many cases 
 cited in 50 L. R. A. (N. S.) 1006, note; Bowers v.. Great Eastern Casualty 
 Co., 260 Pa. 147, 103 Atl. 536 (1918) ; Marcovitch v. Liverpool V. E. Soc, 28 
 T. L. R. 188 (1912) ; Ames' Cases on Pleading, 302-306. 
 
710 OPERATION OF CONTEACT (Ch. i 
 
 had to prove, in order to recover, not only the issuance of the policies, 
 but the death of Mr. Tesson prior to that of his wife. Failing in this, 
 a recovery could not have been had. The same result follows, so far 
 as the claim of her estate is concerned, from the submission. The bur- 
 den of proving survivorship rests upon her administrator, since his 
 claim is through her. Not being able to make. such proof, the proceeds 
 go, as the parties obviously intended they should when the policies were 
 issued, to the representatives of the insured, who take under the poli- 
 cies and not under a survivorship. Dunn v. New Amsterdam Casualty 
 Co., 141 App. Div. 478, 126 N. Y. Supp. 229; Fuller v. Linzee, 135 
 Mlass. 468 ; Hildenbrandt v. Ames, 27 Tex. Civ. App. 377, 66 S. W. 
 128. 
 
 In the Massachusetts case the insurance company promised to pay 
 the sum insured to the wife or assigns within 90 days after due notice 
 and proof of death of the husband, and, in case she should die first, 
 then the amount of the insurance should be payable to their children. 
 The husband, wife, and all of the children were lost at sea, and there 
 was no direct evidence as to which survived the other. The court held 
 that the interest of the wife, under the policy, was contingent upon her 
 surviving her husband, and that neither her assigns nor personal rep- 
 resentatives could show any right to the insurance money, except upon 
 proof of such survivorship. 
 
 In reaching the conclusion that the estate of Mrs. Tesson is not 
 entitled to the proceeds of the policies, United States Casualty Co. v. 
 Kacer, 169 Mo. 301, 69 S. W. 370, 58 L. R. A. 436, 92 Am. St. Rep. 
 641, has not escaped my attention. The decision in that case seems to 
 have been put upon the ground that the beneficiary had a vested inter- 
 est, subject to being divested by death prior to the insured, and for 
 that reason the court held that the burden was upon the representatives 
 of the insured to prove his survivorship. I have been unable to adopt 
 the reasoning which led the court to that conclusion. There the policy 
 was payable to the beneficiary, if living at the time of the death of the 
 insured, who did not have the right to change the beneficiary. In this 
 respect the case is distinguishable from the one now before us. Mrs. 
 Tesson did not have a vested interest. All she had was an expectancy, 
 subject to be defeated by the assured's designating another beneficiary 
 or failure on her part to survive him. L,ane v. De Mets, 59 Hun, 462, 
 13 N. Y. Supp. 347. 
 
 I am of the opinion that the judgment of the Appellate Division is 
 right, and should be affirmed, with costs.^" 
 
 3 " A case with some points in common Is Cfige v. Acton, 1 Ld. Eaym. 515 
 (1700). Did Mr. Tesson's administrator liave more tlian an "expectancy"? 
 What facts would he have had t6 prove in a suit against the insurance com- 
 pany? 
 
Sec. 3) CONDITIONS SUBSEQUENT 711 
 
 SMITH V. MacDONALD. 
 (District Court of Appeal, California, 1918. 37 Cal. App. 503, 174 Pac. 80.) 
 
 Kerrigan, J.'^ This is an appeal from a judgment sustaining a de- 
 murrer to the complaint, without leave to amend. The action was 
 based upon a written instrument which the trial court held to consti- 
 tute only a moral obligation. The instrument reads as follows: 
 
 "May First, 1912. 
 
 "I, W. G. MacDonald, hereby acknowledge my indebtedness to 
 Ernest N. Smith in the sum of five thousand dollars ($5,000). 
 
 "I agree to pay Ernest N. Smith interest at the rate 7 per cent, per 
 annum on this amount ($5,000) with the understanding that the indebt- 
 edness may be retired in installments ; in the event that installments 
 are paid interest is to be computed only on balance due. 
 
 "In view of the fact that W. G. MacDonald and Ernest N. Smith 
 were equal partners in the MacDonald Sales Company up to the sign- 
 ing of this acknowledgment and attached agreement, and that W. G. 
 MacDonald voluntarily agreed to release Ernest N. Smith from his 
 partnership with attending possibilities of considerable financial loss, 
 and agrees to pay Ernest N. Smith ultimately a sum considerably 
 greater than his actual partnership interest, it is part and parcel of this 
 acknowledgment of indebtedness that it shall be void should legal, steps 
 of any kind be taken to force payment, or should the indebtedness be 
 transferred without the permission of W. G. MacDonald. 
 
 "[Signed] W. G. MacDonald. 
 
 "Accepted: [Signed] Ernest N. Smith." 
 
 We think the clause in this unusual document, that if suit should be 
 brought to enforce collection the obligation shall be void, is a valid 
 arjd enforceable covenant not to sue, and that the promise to pay the 
 sum agreed constituted merely a moral obligation. ^^ 
 
 The parties to this agreement were of age and of competent under- 
 standing; and as the contract appears to have been freely and volun- 
 tarily entered into, and is one that is not against public policy in any 
 respect, it should be upheld It would be a grave injustice to defend- 
 ant to hold that an action would lie to enforce the payment of the 
 amount mentioned in this instrument, when it appears that a part of 
 the consideration for the promise to pay was the stipulation on the 
 part of the payee that the obligation should be void if suit should be 
 brought thereon. The right to enforce any obligation which the plain- 
 tiff may have had against the defendant was his, and he could do with 
 it as he saw fit — could agree to relinquish it, or insist on preserving it. 
 Whichever course plaintiff deemed proper to adopt was no matter of 
 public concern, and affects no question of public policy. Gitler et al. 
 
 3^ Part of the opinion is omitted. 
 
 8 2 There was a similar provision in Monroe v. Martin, 137 Ga. 262, 7,3 S. B. 
 341 (1911). 
 
712 OPERATION OP CONTRACT (Ch. 4 
 
 V. Russian Co. et al., 124 App. Div. 273, 108 N. Y. Supp. 793 ; 9 Cyc. 
 335 ; Richardson v. Thomas et al., 28 Ark. 387.*^ * * * 
 The judgment is affirmed. 
 
 GRAY V. GARDNER. 
 (Supreme Judicial Court of Massachusetts, 1821. 17 Mass. 188.) 
 
 Assumpsit on a written promise to pay the plaintiff $5,198.87, with 
 the following condition annexed — viz., "On the condition that if a 
 greater quantity of sperm oil should arr'ive in whaling vessels at Nan- 
 tucket and New Bedford, on or between the first day of April and the 
 first day of October of the present year, both inclusive, than arrived 
 at said places, in whaling vessels, on or within the same term of time 
 the last year, then this obligation to be void." Dated April 14th, 1819. 
 
 The consideration of the promise was a quantity of oil sold by the 
 plaintiff to tlie defendants. On the same day another note uncondi- 
 tional had been given by the defendants,, for the value of the oil esti- 
 mated at 60 cents per gallon; and the note in suit was given to 
 secure the residue of the price estimated at 85 cents, to depend on the 
 contingency mentioned in the said condition. 
 
 At the trial before the Chief Justice the case depended upon the 
 question whether a certain vessel, called the Lady Adams, with a 
 cargo of oil, arrived at Nantucket on October 1st, 1819, about which 
 fact the evidence was contradictory. The judge ruled that the burden 
 of proving the arrival within the time was on the defendants, and fur- 
 ther that, although the vessel might have, within the time, gotten with- 
 in the space which might be called Nantucket Roads, yet it was neces- 
 sary that she should have come to anchor, or have been moored, some- 
 where within that space before the hour of twelve following the first 
 day of October in order to have arrived within the meaning of the con- 
 tract. 
 
 The opinion of the Chief Justice on both these points was objected 
 to by the defendants, and the questions were saved. If it was wrong 
 on either point, a new trial was to be had, otherwise judgment was 
 to be rendered on the verdict, which was found for the plaintiff. 
 
 Whitman for the defendants. As the evidence at the trial was con- 
 tradictory, the question on whom the burden of proof rested became 
 important. We hold that it was on the plaintiff. This was a condition 
 precedent. Until it should happen, the promise did not take effect. 
 On the non-occurrence of a certain contingent event, the promise was 
 to be binding, and not otherwise. To entitle himself to enforce the 
 promise, the plaintiff must show that the contingent event has not 
 actually occurred. * * * 
 
 8»The court here cited the following authorities: Barnard v. Gushing, 
 4 Mete. (Mass.) 230, 38 Am. Dec. 362 (1842) ; Nelson v. Von Bonnhorst, 29 
 Pa. 352 (1857) ; Greenhood, Public Policy, 4G9. 
 
Sec. 3) CONDITIONS SUBSEQUENT 713 
 
 Parker, C. J. The very words of the contract show that there was 
 a promise to pay, which was to be defeated by the happening of an 
 event — ^viz., the arrival of a certain quantity of oil at the specified 
 places in a given time. It is like a bond with a condition ; if the ob- 
 ligor would avoid the bond, he must show performance of the condi- 
 tion. The defendants in this case promise to pay a certain sum of 
 money on condition that the promise shall be void on the happening of 
 an event. It is plain that the burden of proof is upon them, and if 
 they fail to show that the event has happened, the promise remains 
 good. 
 
 The other point is equally clear for the plaintiff. Oil is to arrive at 
 a given place before 12 o'clock at night. A vessel with oil heaves in 
 sight, but she does not come to anchor before the hour is gone. In no 
 sense can the oil be said to have arrived. The vessel is coming until 
 she drops anchor or is moored. She may sink or take fire, and never 
 airrive, however riear she may be to her port. It is so in contracts of 
 insurance, and the same reason applies to a case of this sort. Both 
 parties put themselves upon a nice point in this contract ; it was a kind 
 of wager as to the quantity of oil which should arrive at the ports 
 mentioned before a certain period. They must be held strictly to 
 their contract, there being no equity to interfere with the terms of it. 
 
 Judgment on the verdict.^* 
 
 SMART V. HYDE. 
 . (In the Court of Exchequer, 1841. 8 Mees. & W. 723, 151 Eng. Rep. 1231.) 
 
 Assumpsit. The declaration stated that, in consideration that the 
 plaintiff would buy of the defendant a mare at a certain price, the de- 
 fendant promised the plaintiff that the mare was sound, and averred 
 as a breach that the mare was not sound. 
 
 The defendant pleaded, amongst other pleas, thirdly, that, before the 
 promise, he the defendant sent the mare to a certain place for the sale 
 of horses, called Lucas's Repository, there to be sold according to cer- 
 tain rules, which were in the words following: — "Terms of private 
 sale. A warranty. of soundness, when given at this repository, will 
 
 a* In Lovatt v. Hamilton, 5 M. & W. 689 (1839), a suit was brought for 
 nondelivery of oil; the contract providing: "We have this day sold you 50 
 tons of palm oil, to arrive per Mansfield. * ♦ * In case of nonarrival, or 
 the vessel's not having so much in, * * • this contract to be void. The 
 Mansfield arrived with only 7 tons. It was held that the arrival of the oil in 
 the Mansfield was a condition precedent. 
 
 In Hotham v. East India Co., 1 T. R. 638 (1787), the defendant chartered 
 plaintiff's ship and promised to load 900 tons freight, but no claim for short 
 tonnage was to be allowed unless the shortage was first determined by arbitra- 
 tors. It was held that the plaintifE's right of action "vested" on failure to 
 load, and that defendant must allege and prove failure to arbitrate. Query : 
 Was not the arbitration a condition subsequent to the defendant's duty to 
 load but precedent to his duty to pay damages? 
 
714 OPERATION OF CONTRACT (Ch. 4 
 
 remain in force until twelve o'clock at noon of the day next after the 
 day of sale, when it will be complete, and the responsibility of the seller 
 will terminate, unless in the mean time a notice to the contrary, accom- 
 panied by the certificate of a veterinary surgeon, be delivered at the 
 office of R. Ivucas ; such certificate to set forth the cause, nature, or 
 description of any alleged unsoundness ;" of all which the plaintiff, be- 
 fore and at the time of making the said promise, had notice. The plea 
 then averred, that the sale was a private sale, and that the promise, and 
 the buying from the defendant, took place subject to the said rules and 
 regulations touching the private sale of horses, and that the same were 
 agreed to by the parties ; and although the time limited by the said 
 rules for the delivery of tha notice and certificate had elapsed before 
 the commencement of this suit, yet no such notice or certificate had 
 been delivered by or for the plaintiff, at the office of the said R. L,ucas. 
 Verification. 
 
 Special demurrer, assigning for causes, that the plea amounted to 
 the general issue : that whereas the plaintiff had declared on an abso- 
 lute and unqualified undertaking that the mare was sound, the de- 
 fendant had not confessed and avoided the same, nor had directly de- 
 nied such promise, but had stated matters for the purpose of qualify- 
 ing such promise, and of shewing thafc the warranty remained in force 
 only until twelve at noon of the day after the sale, and was a warranty 
 against such unsoundness only as the plaintiff might discover within 
 such period. 
 
 Crompton, in support of the demurrer. The plea attempts to shew 
 that there was a qualification of the warranty, and that the contract 
 was different from that declared upon, and it therefore amounts to the ' 
 general issue. [Parke, B. The warranty, as set out in the declaration, 
 is an absolute one. The plea admits the statement in the declaration, 
 but sets out new facts, for the purpose of shewing that there was no 
 breach of contract ; it does not deny a sale of the horse, or the war- 
 ranty that the horse was sound.] On the warranty stated in the plea, 
 there is to be no responsibility at all in certain cases, and that is a 
 qualification which might have been given in evidence under the general 
 issue. In Bywater v. Richardson (1 Ad. & Ell. 508 ; 3 Nev. & M. 748), 
 where there was a similar condition, Littledale, J., treats it as a qualified 
 warranty. [ParkE, B. You say that the contract which would have 
 to be proved would vary from that stated in the declaration, and 
 therefore might be given in evidence under the general issue.] Yes. 
 In Latham v. Rutley (2 B. & Cr. 20; 3 D. & R. 211), the declaration 
 stated a contract to carry goods from L,ondon, and deliver them safely 
 at Dover ; the contract proved was to carry and deliver safely, fiire and 
 robbery excepted ; and it was held to be a variance. Here the contract 
 stated in the declaration is, that the defendant will be generally answer- 
 able for the unsoundness of the mare ; but the contract stated in the 
 plea is, that he will not be answerable at all, if the act be not done 
 
Sec. 3) CONDITIONS SUBSEQUENT 715 
 
 within a given time. In Latham v. Rutley, Abbott, C. J., says, "the re- 
 sult of all the cases upon the subject is, that if the carrier only limits 
 his responsibility, that need not be noticed in pleading ; but if a stipula- 
 tion be made that, under certain circumstances, he shall not be liable 
 at all, that must be stated." [Parke, B. The contract there stated was 
 a contract to carry the goods safely, not a limited contract, if the 
 goods were not affected by fire or robbery. Here the contract alleged 
 is, that the defendant undertook that the mare was sound : that he is 
 to be responsible if vinsound is merely an inference from that.] Where 
 a condition merely limits the amount of damages, it is true that it need 
 not be stated in the declaration; Clarke v. Gray (6 East, 564); but 
 where the contract, as in this case, is qualified by conditions, it is a vari- 
 ance to state it as absolute in its terms. In Howell v. Richards (11 
 East, 633), it was held, that, if a covenant for quiet enjoyment be re- 
 strained by any qualifying context, it must be stated, and if not, that 
 the defendant might take advantage of it under the plea of the general 
 issue, as being an untrue statement of the deed in substance and effect. 
 Tempany v. Burnaud (4 Campb. 20), and Browne v. Knill (2 Brod. 
 & B. 395), are authorities to the same effect. In Whittaker v. Mason 
 (2 Bing. N. C. 359; 2 Scott, 567), the plaintiff declared upon a con- 
 tract of sale of certain books; the defendant pleaded that the books 
 were sold subject and according to the usage and course of dealing 
 observed among booksellers in London ; to which the plaintiffs replied 
 de injuria; and on demurrer to the replication, it was held that the plea 
 in effect amounted to the general issue. [ParicE, B. There the plea 
 set up a different contract ; here the plea does not alter the considera- 
 tion or the promise.] The omission to state the qualification entirely 
 alters the legal effect of the contract. The case is distinguishable from 
 Syms v. Chaplin (5 Adol. & Ell. 634; 1 Nev. & P. 129), which was an 
 action against a coach proprietor for the loss of a parcel above the 
 value of £10; for the omission to declare the value of the parcel did 
 not qualify the nature of the contract, but was a matter which avoided 
 it, and therefore required to be specially pleaded. The general rule is, 
 that contracts are entire, and it is only an exception to that 'rule, that 
 where a part of the contract does not affect the rest which is declared 
 upon, such part need not be stated. , 
 
 J. Henderson, contra. The plea is good. The truth of the facts 
 stated in it is consistent with the contract alleged in the declaration. 
 The defendant says. True it is I promised that the horse was sound, 
 and' it turned out to be unsound, but there were collateral circum- 
 stances which prevented your right to sue from arising. Where, in- 
 deed, the plea discloses a contract different from that alleged in the 
 declaration, it is bad, as amounting to the general issue. The cases 
 which have arisen since the New Rules on indebitatus assumpsit, shew 
 that where, if the plea be true, the declaration is not, in that case the 
 plea is open to demurrer, as amounting to the general issue. In Latham 
 
716 OPERATION OF CONTRACT (Ch. 4 
 
 V. Rutley, the promise alleged was absolute, but the contract proved 
 was a qualified one, and therefore did not support the promise declared 
 on. But where there is an absolute promise, and the defence is that its 
 efficacy has been destroyed by matters occurring subsequently, those 
 matters must be specially pleaded. In Hotham v. The East India Com- 
 pany (1 T. R. 638), where there was a covenant in a charter-party, that 
 no claim for short tonnage should be allowed, unless such short tonnage 
 were found and made to appear on the ship's arrival, on a survey to 
 be taken by four shipwrights ; it was held, that this not being a con- 
 dition precedent to the plaintiff's right to recover for short tonnage, 
 but a matter of defence to be taken advantage of by the defendants, 
 the not averring performance was no ground for arresting the judg- 
 ment. That case resembles the present. It was not necessary for the 
 plaintiff to aver performance of the condition annexed to this war- 
 ranty; it is sufficient for him to allege the contract and breach. The 
 fact on which the defendant relies is collateral to the original contract, 
 and therefore ought to be pleaded specially. 
 
 Crompton, in reply. The contract as set out in the plea affects the 
 consideration stated in the declaration, for the plaintiff is bound to give 
 notice of the unsoundness before a specified time, in order to reilder 
 it an absolute warranty. Hotham v. East India Co. turns on the dis- 
 tinction between covenant and assumpsit, and on the rule which is 
 peculiar to the former, that a party need not set out more covenants 
 than those of the breach of which he complains ; but that is not applica- 
 ble to assumpsit. The condition which it is not requisite to state is 
 such a one as does not qualify the original promise. The narrow 
 point is — does this plea affect the liability which the defendant is under, 
 upon the contract alleged in the declaration? It is submitted that it 
 does; it shews that he is not absolutely bound; whereas on the con- 
 tract as stated in the declaration he is so. Latham v. Rutley is in point. 
 [Parke, B. In that case there was no promise to carry safely at all 
 events; here there was an absolute warranty of soundness.] 
 
 Parke, B. I am of opinion that the plea is a good plea, and that the 
 defendant is entitled to judgment. The declaration states, that, in 
 consideration that the plaintiff would buy a mare of the defendant, 
 the defendant promised that she was sound. Then there is a special 
 plea, which states, that the mare was sent to a repository for tlie sale 
 of horses, to be sold according to certain rules, which provided that 
 the warranty of soundness was to remain in force up to a certain time 
 only, unless notice of the unsoundness was in the mean time given; 
 and it goes on to aver, that the sale took place subject to those rules, 
 and that no notice was delivered within the time specified. It ap- 
 pears to me that such plea is not bad as amounting to the general is- 
 sue. It admits the contract and the promise, but shews it to have been 
 made subject to certain rules which have not been complied with. 
 What is the meaning of those terms ? It seems to me to be this, that 
 
Sec. S) CONDITIONS SUBSEQUENT 717 
 
 the warranty shall be deemed to have been complied with, unless a 
 notice and certificate shall be delivered to the vendor before twelve 
 o'clock at noon of the day next after the day of the sale. That is not 
 a denial of the warranty, but a mere condition annexed to it. No no- 
 tice and certificate were delivered, and therefore the contract is to be 
 considered as complied with. If the matter relating to the notice had 
 been by way of proviso upon the warranty, it might perhaps have 
 been necessary to state it in the declaration; but upon that point I 
 give no opinion. It is enough to say, that every word of this plea is 
 consistent with the contract stated in the declaration. 
 
 Alderson, B. The meaning of the plea is, that there was a sort of 
 conventional warranty of soundness, and that the warranty was to be 
 considered as complied with, unless a notice and certificate of un- 
 soundness were given within a certain time, which was not done. 
 That is not a denial of the contract, as alleged in the declaration. 
 
 GuRNEY, B., and RoLFE, B., concurred. 
 
 Judgment for the defendant.^^ 
 
 RAY V. THOMPSON. 
 
 (Supreme Judicial Court of Massachusetts, 1853. 12 Cush. 281, 59 Am. 
 
 Dec. 187.) 
 
 Assumpsit for the price of a horse sold to the defendant. The de- 
 fence was that the horse was sold under a conditional contract, with 
 a right to return him within a specified time, if not satisfactory to the 
 defendant, and that the defendant did so return him. At the trial in 
 the court of common pleas before Mellen, J., the plaintiiif ofiEered evi- 
 dence tending to prove that during the time limited by the contract 
 for the return of the horse, and while he was in the defendant's pos- 
 session, the defendant misused and abused the horse, whereby he was 
 materially injured and lessened in value, and that the plaintiff did not 
 accept him in return; which evidence, the presiding judge, on objec- 
 tion by the defendant, rejected, and, the verdict being for the defend- 
 ant, the plaintiff alleged exceptions to the ruling. 
 
 Per CiJRiAM. The evidence offered by the plaintiff ought to have 
 been admitted, to prove, if he could, that the horse had been abused 
 and injured by the defendant, and so to show that the defendant had 
 put it out of his power to comply with the condition, by returning the 
 horse. The sale was on a condition subsequent ; that is, on condition, 
 he did not "elect to keep the horse, to return him within the time lim- 
 ited. Being on a condition subsequent, the property vested presently 
 in the vendee, defeasible only on the performance of the condition. If 
 the defendant, in the meantime, disabled himself from performing the 
 condition, — and if the horse was substantially injured by the defend- 
 
 3 5 See, also, Head v. Tattersall, L. E. 7 Ex. 7, 25 L. T. 631, 41 L. J. Ex. 
 4 (1871). ■ ' 
 
718 OPERATION OF CONTRACT (Ql. 4 
 
 ant by such abuse, he would be so disabled, — then the sale. became 
 absolute, the obligation to pay the price became unconditional, and the 
 plaintiff might declare as upon an indebitatus assumpsit, without set- 
 ting out the conditional contract. Moss v. Sweet, 3 Eng. Law & Eq. 
 311, 16 Adol. & E. 493. 
 New trial ordered.''* 
 
 ^^ A condition subsequent (like conditions precedent) is not infrequently 
 a voluntary act of the party on wliom the contract duty rests. He then has 
 a power to terminate such duty. This power may itself be conditional, but 
 need not be. Eedington v. Hartford, 85 N. J. Law, 704, 90 Atl. 284 (1914), 
 promise to pay $60,000 in 10 annual installments, with the privilege of an 
 extension on any installment by asking for it ; Golden Cycle Min. Co. v. Eap- 
 son Coal. Min. Co., 188 Fed. 179, 112 0. C. A. 95 (1911), bilateral contract 
 for all coal buyer "may use" on its mine for 3 years, with i)ower to terminate 
 by 90 days notice in case buyer should itself acquire a coal mine; Chicago 
 Fire Brick Co. v. General Roofing Mfg. Co. 133 111. App. 269 (1907), power 
 '"to cancel this order not later than next Tuesday in ease we find that we are 
 unable to set a satisfactory carpenter; Farmers' Handy Wagon Co. v. New- 
 comb, 192 Mich. 634, 159 N. W. 152 (1916), the notice, of termination is not 
 operative until it is received ; Fritz v. Pennsylvania Fire Ins; Co., 85 N. J. 
 Law, 171, 88 Atl. 1065, 50 L. R. A. (N. S.) 35 (1913), same; Fraenkel v. 
 Frledmann, 199 N. Y. 351, 92 N. B. 666 (1910) ; Strander v. Mcintosh, 169 
 Wis. 403, 172 N. W. 717 (3919). See, also, New Zealand Shipping Co. v. 
 SociStS de France, [1919] A. C. 1 (1918) ; Mackey Wall Plaster Co. v. United 
 States Gypsum Co. (D. C.) 244 Fed. 275 (1917) ; International Filter Co., v. 
 La Grange Ice & Fuel Co., 22 Ga. App. 167, 95 S. E. 736 (1918), option to buy 
 to become absolute unless lessee gave notice to the contrary. Observe con- 
 stantly that the fact operating as a condition may be subsequent to the 
 primary contractual obligation while its nonoccurrence may be precedent 
 to the secondary obligation or duty to pay damages. 
 
 Cases above should be compared with those on "Parol Exoneration and 
 Rescission," post, pp. 948-957, where the discharge is by virtue of a new agree- 
 ment and not by exercise of a power reserved in the old agreement. 
 
 The distinction between a condition precedent and a condition subsequent, 
 as well as that between a condition and a promise or covenant, has been large- 
 ly dealt with in the law of property. There too. the condition is an operative 
 fact, but the legal relations to which it is precedent or subsequent in time are 
 those which constitute ownership or "title." (The analysis of these relations 
 should be made in the course on property.) If the fact is a condition pre- 
 cedent, it must exist before title will vest in the grantee ; if it is a condition 
 subsequent, upon its coming into existence a title that has already vested in 
 the grantee will be devested. 
 
 In Rooks Creek Evangelical Lutheran Church v. First Lutheran Church of 
 Pontiac, 290 111. 133, 124 N. B. 793, 7 A. L. R. 1422 (1919), a church lot was 
 conveyed "on condition that the said church be and remain connected with 
 the Hauges Lutheran Synod." Disconnection with the Synod was held to be 
 a condition subsequent, and the clause in the conveyance was not a mere 
 covenant. The court said, "It must be conceded that the words 'on condi- 
 tion,' in a deed, are apt words to create a condition; yet such words have 
 often been construed, in view of the context, as creating a covenant rather 
 than a condition. * * * j(. jj^g been held that a covenant or condition 
 may be created by the same words. The chief distinction between a condition 
 subsequent and a covenant pertains to the remedy in the event of a breach, 
 which in the former subjects the estate to a forfeiture and in the latter is 
 merely a ground for recovery of damages. * * * a covenant is an agree- 
 ment duly made between the parties to do or not to do a particular act." 
 
 Conditions subsequent and covenants are distinguished in Northwestern 
 University v. Wesley Memorial Hospital, 290 111. 205, 125 N. E. 13 (1919) ; 
 Lfiepenbrock v. Lulz, 159 Cal. 716, 115 Pac. 743, L. R. A. 1915C, 234, Ann. 
 Cas. 1912C, 1084 (1911) ; Gunsenhiser v. Binder, 206 Mass. 434, 92 N. E. 705 
 
Sec. 3) CONDITIONS SUBSEQUENT 719 
 
 WILMINGTON & R. R. CO. v. ROBESON. 
 (Supreme Court of North Carolina, 1845. 27 N. C. 391.) 
 
 The defendant subscribed for 30 shares in the plaintiff company. 
 The subscription paper recited that the State had promised to take 
 two-fifths of the stock, on condition that the other three-fifths should 
 be subscribed by private citizens, and each subscriber's promise was 
 limited as follows : "Provided, however, that if a sufficient subscrip- 
 tion is not obtained, to secure the subscription of the State, within 
 twelve months from this date, each of us may, if we think proper, 
 withdraw his subscription, and be entitled to receive back whatever 
 sum may have been advanced thereon, within twelve months from 
 this time — February 1st, 1837." Between February, 1837, and Feb- 
 ruary, 1838, the defendant paid several instalments on his stock, and 
 one in March, 1838, and was, from time to time, notified to pay other 
 instalments, which he neglected to do, and this suit was commenced 
 in 1843, to recover the balance due on his subscription. The writ is- 
 sued the .30th day of March, 1843. The plaintiffs produced no evi- 
 dence to show, that, within the twelve months, as specified in the arti- 
 cles of subscription, three -fifths of the stock had been taken by pri- 
 vate subscribers, so as to insure the taking by the State of two-fifths. 
 
 The defendant asked that verdict be directed in his favor. 
 
 Nash, J.^^ This is not a case of pleading, but its rules will throw 
 much light upon the question submitted to our decision. The instruc- 
 tion ^prayed for is based upon the supposition, that the procuring the 
 three-fifths subscription within the twelve months, was a condition 
 precedent to the defendant's being bound to pay for the stock he took. 
 If it was a condition precedent, then the plaintiffs were bound to set 
 it forth in the declaration, and aver its fulfillment, or show some cause 
 for its non-performance. 1 Chit. PI. 310. It is true that in every 
 action upon a contract, whether under seal or by parol, the contract 
 must be substantially set forth, that is, it is sufficient to show the sub- 
 stance and legal effect. 1 Chitty on Pleading; Lent and another v. 
 Padelford, 10 Mass. 230, 6 Am. Dec. 119. Nor is it requisite to set 
 forth more of the contract than the portion, the breach of which is 
 complained of. 1 Chit, on Pleading, 299 ; 4 Taun. 285 ; Tempest v. 
 Ranling, 13 East, 18. In the latter case. Lord Ellenborough says, "It 
 is enough to state that part truly, which applies to the breach com- 
 plained of, if that, which is omitted, do not qualify that which is stat- 
 ed." Howell against Richards, 11 East, 638, is to the same effect. If 
 the portion of the contract omitted is important to the plaintiff's case, 
 
 (1910) ; Cavanagh v. Iowa Beer Co., 136 Iowa, 286, 113 N. W. 856 (1907) ; 
 Scovill V. McMahon, 62 Conn. 378, 26 Atl. 479, 21 L. R. A. 58, 36 Am. St. Rep. 
 350 (1892) ; Hale v. Finch, 104 U. S. 261, 26 L. Ed. 732 (1881). See, further^ 
 Anson, Contracts (Corbln's Ed.) §§ 358, 359. 
 
 3 7 The concurring opinion of Ruffin, ,C. J., and part of the discussion of the 
 supposed differences between a proviso and an exception are omitted. 
 
720 OPERATION OF CONTRACT (Ql. 4 
 
 the defendant may take advantage of it under the general issue, as a 
 fatal variance. The part of the contract, here omitted, neither quali- 
 fies the contract, nor discharges, of itself, the liability of the defend- 
 ant. The contract is not, that the failure to secure the State's sub- 
 scription of two-fifths should make void the defendant's liability; but 
 it gives him the right, if he choose to exercise it, of discharging him- 
 self by withdrawing the subscription within a limited time, and de- 
 manding the money he may have paid. The failure of the State's sub- 
 scription does not discharge him; he must discharge himself. The 
 error consists in not distinguishing between a. proviso and an excej)- 
 tion. A proviso is properly the statement of something extrinsic of 
 the subject matter of the contract, which shall go in discharge of the 
 contract, and, if it is a covenant, by way of defeasance. An excep- 
 tion is the taking some part of the subject matter of the contract out 
 of it. A proviso need not be stated in the declaration, for this, says 
 Mr. Chitty, ought to come from the other side. 1 Saunders, 334, n. 
 2 ; Sir Richard Hotham and others v. East India Co., 1 Terin R. 645. 
 In the latter case, Ashurst, Justice, in speaking of the circumstance 
 which was omitted in the declaration, observes, "This, therefore, be- 
 ing a circumstance, the omission of which was to defeat the plaintiff's 
 right of action, once vested, whether called by the name of a proviso, 
 by way of a defeasance, or a condition subsequent, it must in its na- 
 ture be a matter of defence, and ought to be shown by the defend- 
 ants." ^" How stands this case? The defendant had subscribed for 
 thirty shares of stock, and had neglected to pay up the instalments as 
 they fell due. This was admitted. Here then was a breach on his 
 part, and a right of action vested in the plaintiffs. How was this 
 vested right to be divested? By its being made to appear that the 
 subscription of the State had not been secured in the required time. 
 And, according to Justice Ashurst, it was either a proviso or condition 
 subsequent, to be shewn by the defendant, and could not be a condi- 
 tion precedent. * * * We are of opinion, then, that the court 
 could not have given the instruction requested, because procuring the 
 subscription of the State was not a condition precedent to the liability 
 of the defendant; and, therefore, he was not discharged, because it 
 was not secured in the time specified. It was a condition subsequent, 
 or rather a proviso, the benefit of which could have been claimed by 
 the defendant, if he had thought it his interest to do so, and availed 
 himself of the privilege in proper time. 
 
 The proviso is, if the subscription of the State is not secured in 
 twelve months from the 1st of February, 1837, then, not that the de- 
 fendant's subscription shall be null and void, but that the defendant 
 shall be at liberty to withdraw his subscription within the same time. 
 The charge of his Honor upon this part of ther case, we think erroi;e- 
 ^ous, andj if it was or could be, under the circumstances, injurious to 
 
 88 Accord : ;Etria Indemnity Co. v. Geoi-ge A. Fuller Co., Ill Md. 321, 342, 
 73 Atl. 738, 74 Atl. 369 (1909). 
 
Sec. 3) PLEADING AND BURDEN OP PROOF 721 
 
 the defendant, we should feel ourselves constrained to grant him a 
 new trial. The company, the plaintiffs, had until the close of the last 
 day of. the twelve months, to secure the subscription of the State, and 
 although, by the terras of his contract, the defendant was called on to 
 withdraw his subscription within the same period, yet the law will al- 
 low him a reasonable time, after the lapse of the year, to avail him- 
 self of it. He could not immediately ascertain the fact. One month 
 after the expiration of the time, to-wit, in March, 1838, he paid up 
 another instalment. Five years thereafter, he is sued for the instal- 
 ments still due, and in all this time he has not exercised the right he 
 had reserved to himself, of withdrawing his subscription and demand- 
 ing of the company the money he had previously paid, nor has he yet 
 done it; but, from anything disclosed in the case, is now in the en- 
 joyment and exercise of all the rights and privileges of a stockholder. 
 The proviso was inserted for his benefit ; there is nothing in it com- 
 pulsory on him. He was at liberty to take advantage of it, if he 
 chose. He has not so done. He has made his election to retain his 
 stock, as being his interest, and comes now too late, to ask to be dis- 
 charged. 
 
 ELLIOTT V. BLAKE. 
 (In the King's Bench, 1662. 1 Lev. 88.) 
 Covenant and declares. That the defendant covenanted to deliver 
 to him 1500 measures of saltpetre before such a day, and that he had 
 not done it; the defendant demands oyer of the deed, wherein the 
 covenant was as before said. Provided, That if any mischance hap- 
 pen by fire or water to disable him, that he should be excused; and 
 pleads that he was disabled by accident of fire. Issue thereupon and 
 verdict for the plaintiff. And it was moved in arrest of judgment, 
 that there was a variance between the deed on which he declared and 
 that produced in Court ; for the one is absolute and the other condi- 
 tional. But judgment was given for the plaintiff, for he need not de- 
 clare on more of the 'deed than the covenant, and it is on the defend- 
 ant's part to show the proviso, which goes by way of defeasance of 
 the covenants.^* 
 
 3» In accord : . Wheeler v. Bavidge, 9 .Ex. 668 (1854) , charter party to deliver, 
 the a,ct of God, the Queen's enemies, flre, etc., always excepted ; Fike v. Strat- 
 ton, 174 Ala. 541, 56 South. 929 (1911), contract to complete work by a certain 
 date, "delays beyond contractor's control excepted;" the burden of alleging', 
 and proving such excepted causes was held to be upon the defendant because 
 "peculiarly within his knowledge." 
 
 It is sometimes provided by statute that the defendant must specifically 
 allege the particular tonditions precedent the existence of which he means to 
 contest. See Board of Education of City of Wildwood v; Richmond Const. Co., 
 92 N. J. Law, 496, 105 Atl. 220 (1918) ; Thomas v. Walden, 57 Ma. 234, 48 
 South. 746 (1909) ; Delaware River Quarry & Construction Co. v. Board of 
 Chosen Freeholders of Hunterdon County, 86 N. J. Law, 294, 90 Atl. 1023 
 (1914). 
 
 See, in general, Kendall v. Brownson, 47 N. H. 186, 196 (1866), 
 
 COEBIN CONT — 46 
 
722 OPERATION OF CONTRACT (Ch. 4) 
 
 CADWEI.L V. BLAKE. 
 (Supreme Judicial Court of Massachusetts, 1856. 6 Gray, 402.) 
 
 Action of contract, , commenced on the 5th of April, 1854, by the 
 assignees in insolvency of David Ames and John Ames, upon an agree- 
 ment in writing made by the latter with the defendants on the 26th of 
 January, 1853. 
 
 The following are the material parts of that agreement: 
 
 "The said D. & J. Ames hereby sell to the said Blake & Valentine all 
 the right, title and interest which the said D. & J. Ames have in the 
 machinery and fixtures now at their paper mill at Chicopee Falls. 
 They also agree that said Blake & Valentine shall have the right which 
 said D. & J. Ames have to manufacture white paper, made from straw 
 and other materials; which right has been assigned to said D. & J. 
 Ames by Jean Theodore Coupler and Marie Amadee Charles Millier, 
 and as described in the application of said D. & J. Ames for letters 
 patent of the United States. They also agree to instruct the said 
 Blake & Valentine fully in the art and mystery of preparing the straw 
 and other materials, and manufacturing the same into paper, and to 
 communicate to them from time to time all the improvements which 
 they, the said D. & J. Ames, shall make in said art, and give them the 
 benefit thereof ; which instructions the said Blake & Valetitine are to 
 keep secret, so far as secrecy can be preserved consistently with their 
 business. 
 
 "The said Blake & Valentine are to pay for said machinery and 
 fixtures four thousand dollars, in four equal annual payments, with 
 annual interest from date. Payment is to be made in paper, manufac- 
 tured according to the process above mentioned, at the market price 
 of such paper at the time when each payment shall become due, the 
 paper to be delivered at the Western Railroad freight depot in Spring- 
 field. They also agree to take possession of said machinery and fix- 
 tures by the fourth of July next, and proceed as soon as may be with 
 the manufacture; and to pay to said D. & J. Ames, for the right to 
 manufacture said white paper," a certain share of the profits, if the 
 profits exceed two cents a pound ; otherwise, nothing. 
 
 "If any dispute or disagreement shall arise between the parties in 
 regard to the estimate of the profits, it shall be referred to three dis- 
 interested men, one to be chosen by each party, and the third by the 
 two referees, and the award shall be binding on the parties." 
 
 "If the said D. & J. Ames shall, upon request, refuse to teach the 
 said Blake & Valentine the art of making said paper as above men- 
 tioned, they shall forfeit, as liquidated damages, distinct from all the 
 other liabihties under this contract, the sum of four thousand dollars." 
 
 The declaration set forth the agreement, and averred that David 
 Ames and John Ames delivered said machinery and fixtures to the 
 defendants according to the terms thereof, and the defendants accepted 
 
Sec. 3) ' PLEADING AND BURDEN OF PROOF 723 
 
 and received the same; that the defendants owed the plaintiffs there- 
 for the sum of one thousand dollars with interest, and also the interest 
 due on four thousand dollars, as therein stipulated ; and that the plain- 
 tiffs had been ready to receive the paper therein specified, yet the 
 defendants had not delivered the same, but had refused so to do. , 
 
 Answer, 1st. That the defendants entered into said agreement, upon 
 the consideration and for the purpose of securing the right to manu- 
 facture white paper from straw by the process therein named, and of 
 obtaining the necessary instructions in said art and mystery; that D. 
 & J. Ames and the plaintiffs had failed to fulfill their contract in this 
 behalf, and had neglected and refused 'to secure to the defendants the 
 right to manufacture according to said process, and to instruct them 
 in the art and mystery thereof although repeatedly requested by the 
 defendants so to do, and had prevented the defendants from using 
 said process. 2d. That there had been a failure of consideration for 
 the contract on their part; that said machinery and fixtures were of 
 no value to them, without said instructions and said right to manu- 
 facture ; and they had offered to return them. 3d. That D. & J. Ames 
 were not the proprietors of said right to manufacture, and had not 
 at the time, nor obtained since, any effectual assignment thereof, or 
 any right to contract with the defendants therefor; or else had failed 
 to avail themselves of such assignment, and had abandoned, lost, and 
 suffered themselves to be deprived of the right to use said process, and 
 of the patent issued therefor ; whereby their agreement to give the de- 
 fendants such right had been defeated, and the defendants prevented 
 from using said process and from manufacturing said paper. 4th. 
 That the defendants by such failure to secure to them said right and to 
 give them- such instructions, had been prevented from fulfilling the 
 agreement on their part. 5th. That D. & J. Ames were requested to 
 teach the defendants the art and mystery of making said paper ac- 
 cording to said process, but neglected and ^fused so to do, and there- 
 by incurred a forfeiture under said agreement of the sum of four 
 thousand dollars as liquidated damages ; which the defendants claim- 
 ed the right to apply to offset and cancel all claims of the plaintiffs 
 under the agreement. 
 
 At the trial in this court, the defendants admitted the execution of 
 the agreement, and the delivery to them of possession of the paper 
 mill, machinery and fixtures about the 1st of March, 1853. The plain- 
 tiffs then rested their case. 
 
 The defendants contended that the plaintiffs were not entitled to 
 recover, without proving "1st. That D. & J. Ames had such an as- 
 signment of the right as their contract states; 2d. That they had 
 availed themselves of it, and made it effectual to secure to themselves 
 the patent, or at least a right to manufacture under it for themselves 
 and the defendants; 3d. That they had conveyed or secured to the 
 defendants the right to use the process ; 4th. That they had instruct- 
 ed the defendants in the art of making said paper." 
 
724 OPERATION OF CONTRACT (Ch. 4 
 
 The plaintiffs denied that it was necessary for them to offer any 
 further evidence, or that any of the matters alleged in the answer con- 
 stituted a good defence to the action. 
 
 Bigelow, J., ruled that the plaintiffs had made out a prima facie 
 case, and would be entitled to a verdict, unless the defendants went 
 forward and offered evidence of the matters set out in their answers ; 
 and reported the case for the determination of the full court, upon 
 these two questions : 1st. The correctness of his ruling as to the suffi- 
 ciency of the case as presented by the plaintiffs ; 2d. The sufiSciency 
 of the grounds of defence set forth in the answer; a new trial to be 
 had if, upon either of these points, the opinion of the court should be 
 in favor of the defendants. 
 
 The arguments and decision upon this report were had at the last 
 September term. 
 
 Shaw, C. J. No question arises in the present case as to the plead- 
 ing; the declaration is perhaps sufficient, under the new practice act, 
 to enable the plaintiffs to recover, inasmuch as it does briefly aver the 
 performance on the part of D. & J. Ames, and the plaintiffs, their 
 assignees in insolvency, of all things on their part, by the terms of 
 the contract, -to be performed. But it is a question of proof; did the 
 plaintiffs offer sufficient proof of performance on their part, to enable 
 them to recover ? This again depends on the construction of the con- 
 tract, and whether, according to its true interpretation, the stipulation 
 for the payment of $4,000 and interest, in paper to be manufactured 
 by the process contemplated by the contract, was independent, and 
 to be performed absolutely by such payment; or was it dependent 
 and conditional, and to be perforfned only on condition that certain 
 other things should be first performed on the part of the said D. & J. 
 Ames? 
 
 The contract consists of several articles on both sides, is expressed 
 in terms somewhat brief, and it is not easy to gather from it the full 
 and clear intent of the parties. The great purpose of the contract 
 seems to have been for D. & J. Ames to transfer to the defendants a 
 right, a useful and beneficial right, to manufacture and sell white 
 paper in so cheap a manner and in such quantities as to yield a profit, 
 which right D. & J. Ames had acquired so far as it could be acquired 
 by assignment before patent, and of which they were expecting to 
 become the patentees by a patent to be regularly issued by the com- 
 petent authority of the United States. The particular right is not 
 otherwise specifically described and identified than as a right which 
 had been assigned to them by Coupler & Millier, and as described in 
 the application of D. & J. Ames for letters patent. It manifestly 
 looked to the expectation that D. & J. Ames were to be the patentees, 
 because they were the assignees aiid had applied for a patent, and 
 because they stipulated to extend to the defendants all the benefit 
 of the improvements wnich they should make. 
 
 In construing a mutual agreement, in which there are several stip- 
 
vSec. 3) PLEADING AND BURDEN OP PEOOP 725 
 
 Illations on both sides, the question, whether one is absolute and inde- 
 pendent, or conditional and made to depend on something first to be 
 done on the other side, does not depend on any particular form of 
 words, or upon any collocation of the different stipulations ; but the 
 whole instrument is to be taken together, and a careful consideration 
 had of the various things to be done, to decide correctly the order in 
 which they are to be done. 
 
 It is contended that, as the machinery and fixtures were to become 
 the property of the defendants at once, at a fixed price of $4,000, pay- 
 able at a certain time, they were to pay for them at all events, wheth- 
 er the manufacture of paper by the new process should go on or not. 
 There "would be more force in this argument if it appeared that the 
 fixtures and machinery thus sold were adapted to the general pur- 
 poses of paper-making, and had a market value, independently of the 
 new process, and especially if the time for making the payment had 
 been fixed at a time, before the acts to be done on the other side. 
 
 But in this case, for aught that appears, the machinery and fixtures 
 would be of little value except for manufacturing by the new process. 
 And possibly the defendants may have stipulated to pay a sum great- 
 er than their value for these articles, in consideration of the advan- 
 tages expected from the whole contract. 
 
 The stipulation, that the price of the machinery and fixtures should 
 be paid at a fixed time, afifords no criterion for determining that the 
 stipulation is independent ; because there was ample time, before the 
 first payment, for D. & J. Ames to transfer the machinery, afford all 
 the necessary instruction, execute and deliver a license conveying to 
 the purchasers a right to manufacture, and do all other acts relied 
 on as conditions precedent. 
 
 But the strong ground on which the court are of opinion that these 
 acts of D. & J. Ames were conditions precedent is, that these pay- 
 ments were to be made by a delivery of paper, to be manufactured by 
 this new process from straw and other materials, at the then market 
 value. This process is recognized and represented in the contract 
 itself as an art a>id mystery, to be kept secret as far as practicable, 
 not yet patented, and of which, therefore, there was no specification 
 in the patent qfiSce, from which the process could be learned. The 
 machinery sold may have been that of the inventors, adapted to the 
 making of paper by this process. , . 
 
 It seems to us that these two stipulations — to deliver the machin- 
 ery, and to give the instruction — stand upon the same footing, be- 
 cause both were necessary to the making of paper by this process. 
 The stipulation to instruct , in the art and mystery was absolute and 
 , ,;affirmative, like that to deliver the machinery, not dependent on re- 
 quest. There was a distinct stipulation, that if they should refuse to 
 instruct, on request, they should be liable to liquidated damages ; but 
 „ it has a distinct object;, and does not supersede, the other. , . 
 
 Without instruction in this art and mystery, the defendants might 
 
726 OPERATION OF CONTRACT (Ch. 4 
 
 not know the method of preparing the straw and using the machin- 
 ery; without these, this kind of paper could not be made, it could 
 have no market price, the defendants could not make it, and of course 
 could not deliver it. 
 
 When, in the order of events, the act to be done by the one party 
 must necessarily be done before the other can be done, it is neces- 
 sarily a condition precedent, although there be a stipulation for liqui- 
 dated damages for the breach on each side, and although there be a 
 fixed future time for payment, sufficiently distant to have the work 
 done in the meantime. Suppose B agrees to build, at his own shop, a 
 carriage for A, of A's materials ; A stipulates seasonably to furnish 
 materials, and to pay B iri four months ; and each, upon failure, stipu- 
 lates to pay a sum as liquidated damages. The furnishing or tender- 
 ing the materials by A is a condition precedent. Without it, B cannot 
 perform.. He must build it of A's materials. Even building it of 
 his own would not be a performance. B has his shop, his tools and 
 his workmen all ready, but A does not furnish the materials. If B 
 sues A, averring readiness to perform, he may recover. But if A 
 sues B for not building the carriage, it would be a good answer that , 
 A himself had not furnished the materials ; because, whatever elpe the 
 contract may contain, this is in its nature a condition precedent. 
 
 The court are therefore of opinion that the plaintiffs, as a part of 
 their own case, should not only have averred, but should have- offered 
 proof at the trial, that D. & J. Ames gave full and ample and reason- 
 able instruction to the defendants, or — which is of the same legal 
 effect, in matters of contract for doing specific acts — that they ten- 
 dered and offered such instruction, in regard to the preparation of the 
 material and the use of the machinery, to enable them to make the 
 paper in the manner and of the material proposed, which the defend- 
 ants declined receiving. 
 
 The court are also inclined to the opinion that the legal effect of 
 the stipulation of D. & J. Ames with the defendants was, that they 
 should have a full right to manufacture paper, by the process therein 
 indicated, whatever the nature of the right then was or might bpcome 
 by the obtaining of a patent, which it appears by the contract they 
 expected to obtain, or in failure of such patent, such right as they 
 should hold from the assignment to themi by Coupler & Millier. They 
 were embarking in a new a'nd expensive enterprise; and should an- 
 other person obtain a patent, which might happen, they might be 
 placed in a situation in which they could not carry on the manufac- 
 ture without infringing the right of another. If the patent was ob- 
 tained by D. & J. Ames, it seems to us that they should have tender- 
 ed to the "defendants an assignment of the patent, or at least a i-ight 
 under it ; or that, if the application was still pending, or had been de- 
 nied, and there was no patent, that fact should have been averred. 
 But we have not placed our decision ordering a new trial mainly on 
 
Sec. 3) PLEADING AND BURDEN OF PROOF 727 
 
 that ground ; but throw out the suggestion, for- the consideration of 
 parties, should a new trial be had. 
 
 But there is another ground upon which the court are of opinion 
 that a new trial ought to be had. Perhaps both points reserved in 
 the report depend substantially upon the same question of construc- 
 tion of this contract, namely, whether any of the stipulations of D. & 
 J. Ames constituted conditions precedent; because, if they did, and 
 so far as they did, and the defendants have averred the performance 
 of themi, they would, if proved by the defendants, as they offered to 
 do, be a good defence. Upon looking at the answer, we think that, 
 even if the plaintiffs had made out a prima facie case, several of the 
 facts stated in the answer would have been competent for the defend- 
 ants to prove; and, if proved, would have been available in defence, 
 either by way of bar, or in reduction of damages. 
 
 New trial ordered. 
 
 The plaintififs then amended their declaration by inserting an aver- 
 ment "that the said D. & J. Ames instructed the defendants in 
 the art and mystery of preparing the straw and other materials, 
 and manufacturing the same into paper, and offered them further in- 
 structions if they should need it, and full examination of the prem- 
 ises of the said D. & J. Ames, and permission to take dimensions, and 
 to be shown the use and application of whatever they might desire 
 to inquire about, and to give them all needful information which they 
 should require." 
 
 The defendants demurred to the declaration, for that it did not 
 state a legal cause of action, substantially in accordance with the 
 rules contained in the St. of 1852, c. 312; "because it does not allege 
 that the plaintiffs, or said D. Sz; J. Ames, had secured to the defend- 
 ants the right to manufacture paper by the process named in said 
 contract, nor that the defendants have the right to manufacture ac- 
 cording to the terms of the contract." 
 
 Shaw, C. J. The court are of opinion that this demurrer is well 
 taken and must be sustained. It is true there is no warranty, in 
 terms, of a right to manufacture paper by the process referred to ; 
 but we think such a warranty and condition results from the provi- 
 sions of the contract, the whole of which must be taken together. 
 D. & J. Ames agree that the defendants shall have the right to manu- 
 facture white paper from straw and other materials, which right has 
 been assigned to D. & J. Ames by Coupler & Millier. It is not mere- 
 ly hypothetical, such right as they have, if they have any ; but an ex- 
 press stipulation that they shall have the right, and an affirmative 
 averment of the fact, that it has been assigned to them, so that they 
 have the power to assure it, with an intimation that the assignment is 
 of such a character as to induce them to apply for a patent, which, if 
 granted, would secure to them an exclusive right. If they had sucn 
 an assignment, whether they obtained a patent or not, it would pre- 
 
728 OPERATION OF CONTRACT ^^Ch. 4 
 
 vent any other person from obtaining a patent so as to exclude them 
 from the right. Such a stipulation, accompanied with such an express 
 undertaking that they held such an assignment, amounted to a stipu- 
 lation that no other person should have such right as to exclude them 
 therefrom, and that, either by a grant of the patent right from D. & 
 J. Ames if they obtained one, or by common right if none should be 
 obtained, the defendants should have the right to, manufacture by 
 this new and peculiar process. When we consider that the whole 
 object of the contract was to enable the defendants to manufacture 
 by this process; that the consideration of. the undertakings of the 
 defendants, was their right and power so to manufacture paper ; that 
 the debt was to be paid in paper thus to be manufactured ; that with- 
 out such right the machinery and fixtures might be of little value to 
 them, and the teaching of an art they could not practice, without in- 
 fringing the rights of others, wholly useless, the conclusion seems 
 inevitable, that the enjoyment of a right to use this art and process, 
 patented or unpatented, was regarded by the parties as a condition, 
 without a performance of which, on the part of D. & J. Ames, or 
 those who claim under them, the defendants are not bound to make 
 the stipulated payments. 
 Demurrer sustained.*" 
 
 *" It is sometimes provided by statute that an averment in general terms 
 of fulfilment of conditions precedent by the plaintiff is sufficient (this in no 
 way affects the burden of proof). See Symms-Powers Co. v. Kennedy, 33 
 S. D. 35.5, 146 N. W. 570 (1914) ; Williams v. Fire Ass'n of Philadelphia, 119 
 App. Div. 573, 104 N. 1. Snpp. 100 (1907). See ante, pp. 707, 721, note. 
 
 In the absence of statute such a general allegation will probably be sus- 
 tained after verdict, but it is demurrable. Vivian v. Shipping, Cro. Car. 384 
 (1634) ; Thorpe v. Thorpe, 12 Mod. 455 (1701) ; Worsley v. Wood, 6 T. R. 
 710 (1796) ; Newton Rubber Works v. Graham, 171 Mass. 352, 50 N. E. 547 
 (1898) ; Colt V. Miller, 10 Cush. (Mass.) 49 (1852) ;' Korbly v. Loomis, 172 
 Ind. 352, 88 N. E. 698, 139 Am. St. Rep. 379, 19 Ann. Cas. 904 (1909) ; Zeller 
 V. Wunder, 36 Pa. Super. Ct. 1 (1908) ; Marsch -v Southern New England R. 
 Corporation, 230 Mass. 483, 120 N. B. 120 (1918^ engineer's certificate an 
 express condition precedent. See Ames' Cases on Pleading, 307. 
 
 The fact constituting the condition precedent is a part of the "cause of 
 action." Hernaman v. Smith, 10 Ex. 659 (1855). 
 
Sec. 4) EFFECT ON OTHER PARTY'S DUTY OF rERFOKMANCB 729 
 
 SECTION 4.— REPUDIATION 
 (Both Prior and Subsequent to the Date Set for Perfoi-mance) 
 
 (a) Effect on the Other Party's Duty oe Pereormance and on 
 THE Conditional Character of his Right 
 
 TORKOMIAN v. RUSSEI.L et al. 
 (Supreme Court of Errors of Connecticut, 1916. 90 Conn. 481, 97 Atl. 760.) 
 
 Action by Baron J. Torkomian against William E. Russell, and an- 
 other. From a judgment for plaintiff, defendants appeal. Reversed, 
 and new trial ordered. 
 
 Wheeler, J.*^ The finding recites that : On November 1, 1913, the 
 defendants were dealers in automobiles in Waterbury and agents for 
 the sale of the Lozier make of automobile. On said day the plaintiff 
 and the defendants entered into a written contract by the terms of 
 which the defendants agreed to sell the plaintiff a Lozier 6 automo- 
 bile, to deliver the same between April 15 and May 1, 1914, and to 
 accept in part .payment a used Studebaker car at the agreed price of 
 $700, and to give the plaintiff their note for $700 payable to plaintiff 
 or order on demand in consideration of the Studebaker car. The 
 plaintiff in consideration of the promises of the defendants agreed to 
 pay $3,250 for the Lozier car and not to demand payment of the $700 
 note unless the defendants failed to deliver the Lozier car. From 
 about the beginning of 1914, down to the delivery period, the plain- 
 tiff repeatedly expressed his unwillingness to take the Lozier 6, and 
 desired defendants to substitute another car, which they refused to 
 do. The defendants were ready and willing to deliver the Lozier 6 at 
 the delivery period ; but, by reason of plaintiff's expressed unwilling- 
 ness to accept the car if delivered, the defendants did not make actual 
 physical delivery. Up to May 1, 1914, and at no time thereafter, did 
 the defendants have a Lozier car in their possession for delivery to tlie 
 plaintiff, and they took no steps to procure a car for the plaintiff and 
 to deliver the same to him. * * * 
 
 The agreement expressly provides that the note is not to be demand- 
 ed unless the defendants failed to deliver the car at the period named. 
 The defendants pleaded, and it is found, th^t the plaintiff had noti- 
 fied the defendants for upwards of five months and down to the pe- 
 riod of delivery named that he would not accept the Lozier 6. The 
 
 *i Part of the opinion is omitted. 
 
730 REPUDIATION (Ch. 4 
 
 defendants were entitled to act upon the assumption that the plain- 
 tiff meant what he said, and they were not required to go through the 
 idle ceremony of making a physical tender. They did all that they 
 were obliged to do when, having the means of getting the car, they 
 "were ready and willing to deliver the Lozier 6 automobile at the 
 time specified for delivery in said contract." Adams v. Turner, 73 
 Conn. 38, 46, 46 Atl. 247; Smith v. Lewis, 26 Conn. 110, 118. There 
 has been no failure on the part of the defendants .to deliver this car, 
 and the judgment, so far as the action upon the note was concerned, 
 should have been for the defendants.*^ 
 
 The remaining reasons of appeal that require consideration are bas- 
 ed upon the measure of damages for the defendants adopted by the 
 trial court. In count 1 of the complaint the plaintiff seeks to recover 
 for the defendants' breach of their contract, and in count 2 upon the 
 $700 note. The defendants alleged under their special defense to both 
 counts and as a basis of recovery on their counterclaim, that the plain- 
 tiff had notified them that he would not accept the car contracted for, 
 if tendered, and, further, that they had lost in consequence of this 
 breach of contract by the plaintiff seven hundred dollars. The de- 
 fendants, if entitled to recover under their counterclaim, were entitled 
 to recover under our common law such sum as would put them, so far 
 as it can be done by money, in the same position they would have been 
 in if the contract had been performed. 
 
 In the absence of special circumstances requiring a different nile, 
 the damages recoverable by a vendor for refusal to take goods con- 
 tracted for is the difference at the time and place of delivery, between 
 the contract price and the market price. Jordan Marsh & Co. v. Pat- 
 terson et al., 67 Conn. 480, 35 Atl. 521. But we recognize that this 
 rule is not an unbending one, that the circumstances may require its 
 modification in order to effectuate the cardinal purpose, "just com- 
 pensation for the loss incurred." And the loss must be such as "may 
 reasonably be supposed to have been in the contemplation of the par- 
 
 *^ That a repudiation suspends the other party's duty of further per- 
 formance, see Wetkopsky v. New Haven Gas Light Co., 90 Conn. 286, 96 
 Atl. 950 (1916)'; Roach v. Harty Coal Co., 79 W. Va. 793, 92 S. E. 458 (1917) ; 
 General Bill-Posting Co. v. Atkinson, [1909] A. C. 118 (1908) ; Pearce v. 
 Alward, 163 Mich. 313, 128 N. W. 210 (1910). 
 
 But in order to privilege the other to quit, the repudiation must be definite 
 and go to the essence of the contract. Ackley & Co. v. Hunter-Benn & Co.'s 
 Co., 166 Ala. 295, 51 South. 964 (1910), "it is not every disagreement as to the 
 terms of a contract which authorizes one of the parties thereto to declare the 
 contract annulled" : Wheeler v. New Brunswick & C. R. Co., 115 U. S. 29, 5 
 Sup. Ct. 1061, 1160, 29 L. Ed. 341 (1885), a letter claiming that by "ton" 
 was meant 2,000 pounds instead of 2,240 was no repudiation — four justices 
 dissenting; Hardeman-King Lumber Co. v. Hampton Bros., 104 Tex. 585, 142 
 S. W. 867 (1912), a statement that one is going to quit, while at the same time 
 continuing to work, is no repudiation ; Bannister v. Victoria Coal & Coke Co., 
 63 W. Va. 502, 61 S. E. 338 (1908) ; Bare v. Victoria Coal & Coke Co., 73 W. 
 Va. 682, 80 S. E. 941 (1914) ; Curtis v. Sexton, 142 Mo. App. 179, 125 S. W. 
 806 (1910) ; Consorzio, etc., v. Northumberland Ship. Co., 121 L. T. 628 
 (1919). 
 
Sec. 4) EFFECT ON OTHER PAETT'S DUTY OP PEKPORMANCE 731 
 
 ties at the time they made the contract." Jordan Marsh & Co. v. Pat- 
 terson et al., 67 Conn. 480, 35 Atl. 521. Section 64 of the Sales Act 
 (PubUc Acts 1907, c. 212) reaffirms our rule for measuring damages 
 in case of breach of a contract of sale by the coiitractee or vendee. 
 
 The market price to these defendants of a L,ozier 6 was undoubted- 
 ly less than its selling price, since they were selling agents who pur- 
 chased, and took title to the cars they disposed of. Section 64 pro- 
 vides as a measure of damages the difiference between the contract 
 price and the market price "in the absence of special circumstances 
 showing proximate deunage of a greater amount." The circumstance 
 that these defendants were selling agents and purchased cars at a rate 
 lower than the market price of the cars to the public made the or- 
 dinary measure of damages inadequate. The defendants lost by the 
 plaintiff's breach the difiference between the contract price and what 
 the car ready for physical delivery to the plaintiff would have cost 
 them, which would have been the_ purchase price of the car plus the 
 expense, if any, of delivery and of making it ready for delivery. This 
 is the application to the facts of this case of section 64. It requires 
 the person who has failed to keep his contract of sale to pay the loss 
 caused to the contractor who has kept his contract. Lee v. Harris, 
 85 Conn. 212, 82 Atl. 186. The defendants, as vendors or contractors, 
 were entitled to show what a Lozier 6 car would have cost them in the 
 same way a , manufacturer might show the cost of an article manu- 
 factured by him. The defendants would thus recover the profits they 
 would have made had the plaintiff carried out his contract. In such a 
 case profits are not speculative, but certain and ascertainable, and the 
 legitimate fruits of the contract. Roehm v. Horst, 178 U. S. 1, 21, 20 
 Sup. Ct. 780, 44 L. Ed. 953; Dimmick v. Hendley, 117 Md. 458, 84 
 Atl. 171 ; Poppenberg v. Owen & Co., 84 Misc. Rep. 126, 146 N. Y. 
 Supp. 478. * * * 
 
 Since the defendants retained the Stiidebaker car and the agreed 
 price of this car was $700, the plaintiff should be allowed this sum, 
 and the defendants should be allowed their profit had the plaintiff ful- 
 filled his contract. The judgment should have been for the difiference 
 between these sums and for the plaintifif if the $700 exceeded the 
 profit, and for the defendants if the profit exceeded the $700. 
 
 There is error, the judgment is reversed, and a new trial ordered. 
 In this opinion the other Judges concurred. 
 
 SIR ANTHONY MAIN'S CASE. 
 
 (In the King's Bencli, 1596. 5 Coke, 20 b.) *' 
 
 The case in effect was, that Sir Anthony Main did lease certain land 
 to Scot for 21 years by indenture, and covenanted that at any time 
 during the Hfe of Scot, upon surrender of hfs lease, Sir Anthony, &c. 
 
 *3 Part of the report is omitted. 
 
732 EEPUDIATION (Ch. 4 
 
 would make a new lease during the residue of the years, and bound 
 himself to perform the covenants, &c. And now in debt on the said 
 obligation by Scot against Sir Anthony he pleaded that Scot did not 
 surrender, &c. To which Scot replied, and said, that after the said 
 lease Sir Anthony had accepted a fine sur conusans de droit come ceo, 
 &c. and by the same fine granted and rendered the land to the conusee 
 for 80 years : upon which the defendant did demur in law. And it was 
 adjudged for the plaintiff. And in this case three points were re- 
 solved : 
 
 1. That Sir Anthony Main had broken his covenant without any 
 surrender made, for by the said fine levied by him for 80 years, he 
 had disabled himself either to take a surrender, or to make a new 
 lease; and the law will not enforce any one to do a tiling which will 
 be vain and fruitless, lex nemini cogit ad vana seu inutilia peragenda : 
 but it would be vain to compel him to make a surrender to him who 
 cannot take it; and although the lessee in this case by the words of 
 the indenture ought to do the first act, scil. to make the surrender, yet 
 when the lessor hath disabled himself not only to take the surrender, 
 but also to make a new lease according to the covenant, for this cause 
 the lessor's covenant is broken witliout any surrender made. Vide 32 
 E. 3. Barre, 264. & 21 E. 4. 55. a. If you are bound to enfeoff me 
 of the manor of t). before such a feast, if you make a feoffment of 
 the said manor to another before the said feast, you have forfeited 
 your obligation, although you repurchase the land again before the 
 feast, because you were once disabled to make the feoffment. * * * 
 
 2. It was resolved, if a man seised of lands in fee, covenants to en- 
 feoff J. S. of them upon request, and afterwards he makes a feoff- 
 ment in fee of the said lands ; now in this case J. S. shall have an ac- 
 tion of covenant without request. And that in effect is all one with 
 the principal case. 
 
 3. It was resolved that in the C4se at Bar, if the said term of 80 
 years were but an interest of a future term, so that Scot notwith- 
 standing that might make the surrender, yet in such case Scot should 
 have an action of covenant without making any surrender ; for true it 
 is that he may surrender;, but also true it is, that Sir Anthony after 
 such surrender cannot make the new lease, which was the effect that 
 the surrender should produce ; and therefore in as much as the lessor 
 hath" disabled himself to make a new lease, which is the effect and end 
 of the surrender, and that which he ought to do on his part, the les- 
 see shall not be enforced to make the surrender, which is the first 
 thing to be done on his part, for by the surrender he would lose his 
 old term without a possibility of having the new according to the les- 
 sor's covenant. * * * 
 
Sec. 4) EFFECT ON OTHER PARTY'S DUTY OF PERFORMANCE 733 
 
 NEWCOMB V. BRACKETT. 
 (Supreme Judicial Court of Massachusetts, 1819. 16 Mass. 161.) 
 
 The declaration was in case, "for that the said B. at, &c. on the 8th 
 of August, 1808, by his memorandum in writing of that date, by him 
 subscribed, acknowledged that he had then and there received of the 
 plaintiff a bill of sale of one half of the sloop Union and her apparel, 
 the consideration whereof the said B. then and there acknowledged in 
 writing under his hand to be 200 dollars; which sum the said B. then 
 and there, in said memorandum by him subscribed, promised the plain- 
 tiff to account to him for in a transfer of a deed which the said B. 
 then held against one. Jackson Field's estate, as soon as the plaintiff 
 should pay said B. the residue of a debt to him, which should not ex- 
 ceed 100 dollars. And the plaintiff avers that the transfer of a deed 
 against said J. Field's estate, mentioned in said memorandum, was to 
 be a transfer, assignment and conveyance of the land, described in a 
 certain deed made to said B. by one J. Field, which land the said B. 
 then and there promised to convey to the plaintiff. And the plaintiff 
 further avers that the said B. on the 19th of April, 1810, by his deed 
 of release and quitclaim, by him duly executed, did release and quit- 
 claim to one J. N. Arnold all the right, title and interest, which he the 
 said B. then had to a certain real estate described in said deed, which 
 said real estate was the same of which the 'said B. then held a deed 
 from said J. Field, and of which the said B. was then in possession, 
 and which he had in and by said memorandum engaged to transfer to 
 the plaintiff; and upon which transfer he had engaged to account for 
 said 200 dollars. And the plaintiff further avers, that the said B. had 
 not before said 19th of April accounted to the plaintiff for said 200 
 dollars, in a tran'sfer of a deed held by him, the said B., against said 
 J. Field's estate. And the plaintiff further says, that the said B., by 
 his deed aforesaid made to said J. N. Arnold, has broken his prom- 
 ise aforesaid, and become unable to perform the same, according to 
 the terms thereof. To the damage, &c." 
 
 The defendant demurred to this declaration, and assigned the fol- 
 lowing causes of demurrer. 
 
 1. That the plaintiff hath not alleged or shown, that he has ever paid 
 or tendered to the defendant the residue of said debt, mentioned in 
 the declaration. 
 
 2. That he has not alleged or shown, that he has paid or offered to 
 pay to the defendant the sum of 100 dollars, mentioned in the declara- 
 tion. 
 
 3. That he has not alleged or shown, that he ever requested the de- 
 fendant to transfer to him the deed which the defendant held against 
 J. Field's estate, or to assign and transfer to him the land mentioned 
 in the declaration. 
 
 The demurrer was joined by the plaintiff. 
 
734 REPUDIATION , (Ch. 4 
 
 Parker, C. J.** The contract set forth in the declaration is substan- 
 tially, that in consideration of the value of a sloop sold by the plain- 
 tiff to the defendant, estimated at 200 dollars, the defendant would, 
 upon payment of 100 dollars by the plaintiff, which was due to the 
 defendant from one Field, and to secure which he had taken a deed 'of 
 Field's estate, convey said estate to the plaintiff; and the breach of 
 the contract alleged is, that the defendant had disabled himself from 
 performing the contract, by conveying the same estate to another per- 
 son. 
 
 The declaration is demurred to, and the objection to it is, that the 
 plaintiff had neither paid, nor offered to pay, the debt of Field to the 
 defendant; and therefore has no title to the action. 
 
 'No time is fixed in the contract, within which the money was to be 
 paid, or the estate conveyed to the plaintiff. The plaintiff then had a 
 reasonable time, by virtue of the contract, to perform his part of , it ; 
 and the defendant might have hastened him," by tendering the deed, 
 and demanding the money which the plaintiff had assumed to pay. 
 
 It is implied in the contract, on the part of the defendant, that he 
 would do nothing by which he should become unable to perform it; 
 and by making a deed to another person, he has disabled himself, and 
 so virtually broken his contract. It being impossible for him, after 
 having thus done, to account for the 200 dollars in the land, as he 
 undertook, there is a breach of his contract, for which proper dam- 
 ages may be recovered. The law will not, in such circumstances, re- 
 quire a payment or tender by the plaintiff ; for this would be to hazard 
 an additional loss, without any possible advantage. * * * 
 
 The declaration, in the case at bar, shows that the defendant had 
 conveyed to a stranger the land, which he promised to convey to the 
 plaintiff. This excuses the plaintiff from tendering the money, and 
 entitles him to damages from the breach of the contract. 
 
 Declaration adjudged good. 
 
 CANDA et al. v. WICK. 
 (Court of Appeals of New York, 1885. 100 N. Y. 127, 2 N. E. 381.) 
 
 Andrews, J. The referee found, upon sufficient evidence to justify 
 the finding, that the reasons assigned by the defendant on the twenty- 
 first of September, 1881, for refusing to receive the balance of the 
 brick of the cargo of the schooner Ellen were groundless. He fur- 
 ther found that the brick were of the quality specified in the contract, 
 and that there was sufficient available space for piling them. Upon 
 the defendant's refusal to permit the plaintiffs' cartmen to continue 
 the delivery, the plaintiffs offered to deliver the balance of the cargo, 
 and stated to the defendant that if brick advanced in price they could 
 
 *■• Part of the opinion is omitted. 
 
Sec. 4) EFFECT ON OTHER PARTY'S DUTY OF PERFORMANCE 735 
 
 not be held responsible for the delivery on the contract. The defend- 
 ant persisted in his refusal to receive any more brick from the cargo 
 of the Ellen, assigning the reasons before stated, viz., defective qual- 
 ity and want of space. 
 
 The plaintiffs had. a right to make delivery on the contract on the 
 twenty-first of September. The written memorandum is silent as to 
 the time of delivery, but the evidence shows that prompt delivery and 
 acceptance were contemplated, and that this was one of the conditions 
 upon which the plaintiffs entered into the contract. The tender and 
 refusal constituted, we think, a breach of the contract by the defend- 
 ant. It was not necessary that tlie plaintiffs should tender the whole 
 400,000 brick in order to put the defendant in default. It was not 
 contemplated that the entire number should be delivered in one mass, 
 but, as is evident from the situation of the parties and the surround- 
 ings, they were to be delivered from time to time, at the convenience 
 of the plaintiffs, and without delaying the defendant in prosecuting 
 the work in which they were to be used. When the defendant refused, 
 without adequate reason, to accept the cargo of the Ellen, the plain- 
 tiffs were at liberty to treat the contract as broken, and were not 
 bound to make an actual tender of the remainder of the brick before 
 bringing the action. This would have been a useless ceremony.*'^ 
 The warning given by the plaintiffs to the defendant, that his refusal 
 would absolve them from any obligation on the contract, was not, as 
 is claimed, equivalent to an assertion of a right on their part to regard 
 the contract as still subsisting and executory; or as a reservation of a 
 
 *^ In accord : Ripley v. McOlure, 4 Ex. 345 (1849) ; Cort v. Ambergate, etc., 
 K. Co., 17 Q. B. 127 (1851) ; Laird v. Pirn, 7 M. & W. 474 (1841) ; Jones v. 
 Barkley, Doug. 684, 1st Ed. 659 (1781) ; Braitliwaite v. Foreign Hardwood Co., 
 [1905J 2 K. B. 543, 3 B. R. 0. 580 (1905) ; Jureidini v. National British and 
 Irish Millers' Ins. Co., [1915] A. C. 499 (1914), arbitration a condition pre- 
 cedent, but nullified by repudiation ; Lohr Bottling Co. v. Ferguson, 223 111. 
 88, 79 N. E. 35 (1906) ; Osgood v. Skinner, 211 111. 229, 71 N. E. 869 (1904) ; 
 Hollerbaeh & May Contract Co. v. Wilkins, 130 Ky. 51, 112 S. W. 1126 (1908) ; 
 Southern Sawmill Co. v. Ducote, 120 La. 1052, 46 South. 20 (1908) ; New 
 Mexico-Colorado Coal & Mining Co. v. Baker, 21 N. M. 531, 157 Pac. 167 
 (1916) ; Howard v. Daly, 61 N. T. 362, 19 Am. Rep. 285 (1875) ; Geo. Wiede- 
 mann Brewing Co. v. Maxwell, 78 Ohio St. 54, 84 N. E. 595 (1908) ; Puis v. 
 Casey, 18 Okl. 142, 92 Pac. 388 (1907) ; Browne & Co. v. John P. Sharkey 
 Co., 58 Or. 480, 115 Pac. 156 (1911) ; Douglas v. Hustead, 216 Pa. 292, 65 
 Atl. 670 (1907) ; Allegheny Valley Brick Co. v. C. W. Raymond Co., 219 Fed. 
 477, 135 C. C. A. 189 (1914) ; United States v. Behan, 110 U. S. 338, 4 Sup. Ct 
 81, 28 L. Ed. 168 (1884) ; many eases are cited in 47 L. R. A. (N. g.) 427, 
 note 25 (1911). 
 
 A repudiation does not so operate, unless it is made known to the other 
 party and before performance by him is due. Terrell v. Nelson, 177 Ala. 596, 
 58 South. 989 (1912) ; Makepeace v. Dilltown Smokeless Coal Co., 179 App. 
 Div. 60, 166 N. ¥. Supp. 92 (1917) ; Rauer's Law & Collection Co. v. Harrell, 
 32 Cal. App. 45, 162 Pac. 125 (1917). 
 
 A doubtful or conditional statement does not nullify the condition prece- 
 dent. Easier v. West India S. S. Co., 212 Fed. 882, 129 C. C. A. 382 (1914), 
 "if the boat goes to N., she will probably be late, and if we do not get cargo, 
 we will cancel" ; Hoggson Bros. v. First Nat. Bank of Roswell, 146 C. C. 
 A. 65, 231 Fed. 869 (1916), under existing conditions we ''would prefer not 
 to do the work." 
 
736 EEPDDIATION (Ch. 4 
 
 right to deliver the brick, if they should so elect. The letter of Oc- 
 tober 4, 1881, shows that on several occasions, after the twenty-first 
 of September, the plaintiffs were willing to go on with the contract, 
 but the defendant was not ready, and only became ready when brick 
 had greatly advanced in price. , 
 
 The right of action having accrued from the' transaction of Sep- 
 tember 21st, it was not waived, as matter of law, by a subsequent offer 
 on the part of the plaintiffs to furnish the brick, which was not ac- 
 cepted by the defendant until the advance in the market had materi- 
 ally changed the situation. The price, which the plaintiffs received 
 for the brick on sale to other parties was immaterial, in view of the 
 facts that they were delivered on contracts made prior to September 
 21st, and that the plaintiffs had the ability to furnish all the brick re- 
 quired for all their contracts, including that with the plaintiffs. 
 
 The judgment should be affirmed. 
 
 LEMLE V. BARRY et al. 
 (Supreme Court of California, 1919. 183 Pac. 148.) 
 
 Action by Julius Lemle against Mary M. Barry 'and others. Judg- 
 ment for defendants, and plaintiff appeals. Reversed. 
 
 Wilbur, J.*° This action is brought by the vendee to recover from 
 the vendor the initial payment of $5,000 made by the vendee at the 
 time of the execution of the written contract for the sale of land 
 Plaintiff appeals from a judgment rendered upon sustaining a general 
 demurrer. The contract, which is set out as an exhibit to the com- 
 plaint, was entered into July 31, 1912, for the sale of the "Barry 
 ranch," containing 9,400 acres of land, at the price of $15 per acre. 
 The terms of payment were thus stated: 
 
 "$5,000 to be paid on the execution of this agreement; one-half of 
 the full purchase price to be paid on or before 60 days after the exe- 
 cution of this, agreement ; balance to be secured by note and mortgage 
 payable on or before 3 years after date ; said note and mortgage to be 
 of approved form and with the usual covenants and conditions found 
 in mortgages of real property. The same to bear interest at the rate 
 of 6 per cent, per annum, payable annually," etc. 
 
 It also provided : "It is expressly understood between the parties 
 hereto that the said party of the second part shall at the expiration of 
 60 days from and after the second payment herein stipulated and 
 agreed to be paid, and provided further that said second party shall 
 have made said first payment as herein agreed and otherwise conform- 
 ed to said stipulation and agreement, be entitled to enter upon and 
 take possession of said premises and farm the same in a manner pur- 
 sued for like land ; but said party of the second part hereby and here- 
 
 *° Part of the opinion is omitted. 
 
Sec. 4) EFFECT ON OTHEE PAETT'S DUTY OF PEEPOEMANCB 737 
 
 in agrees not to sell, convey, or otherwise incumber the whole or any 
 portion of said land until said deed and mortgage has been executed 
 according to the terms herein and heretofore contained." 
 
 The agreement also contained the usual provision that time is of the, 
 essence of the agreement, including the following provision, to wit: 
 "And the said parties of the first part, on receiving such payments at 
 the time and in the manner above mentioned, agree to execute and de- 
 liver to the party of the second part, his administrators or assigns, a 
 good and sufficient deed to the property above described." 
 
 Apparently the parties contemplated that upon the making of the 
 60-day payment, the vendor would execute a deed and the vendee exe- 
 cute a note and mortgage for one-half of the balance of the purchase 
 money. This construction of the contract seems to accord with the 
 conduct of the parties, for, within 60 days from the date of the con- 
 tract, the vendors furnished the vendee an absti:act of title continued 
 to August 12, 1912. On September 17,, 1912, the vendee's attorney 
 reported to the vendee his conclusion with reference to the abstract of 
 title, and on or about said date the vendee communicated said report 
 to the vendors with a written demand that the alleged defects therein 
 be corrected. The attorney's report upon the abstract in question, 
 which is set out in full in the complaint, is to the effect that it appear- 
 ed therefrom that the vendors owned the title in fee to an undivided 
 four-sevenths of most of the property known as the Barry ranch, and 
 that three-sevenths belonged to Mary M. Barry (five-fourteenths) 
 and to John H. Barry (one-fourteenth). Other objections to the title 
 are not clear, in the absence of the abstract, which is referred to in 
 the report. 
 
 One objection is that the abstract shows that one and one- third 
 acres of land had been deeded to the trustees of the Cottonwood 
 school district. It is alleged in the complaint that the vendors never 
 at any time have corrected or remedied the defects in their title, and 
 that they never have presented a good and merchantable title to said 
 premises, and have never been able to convey to the plaintiff a good 
 and sufficient and merchantable title to said premises, and it is also 
 alleged that the vendors have never performed or offered to perform 
 any of the covenants contained in their agreement or tendered the 
 plaintiff any deed or conveyance to said property. It. is further alleg- 
 ed that on June 4, 1913, the vendors delivered to the vendee a notice, 
 set out in the complaint in part, as follows: 
 
 "You are hereby notified that you have forfeited any and all rjghts 
 which you may hold in and to that certain agreement * * * 
 dated the 31st day of July, 1912, * * * and said parties of the 
 first part therein hereby declare such forfeiture by reason of your non- 
 compliance with the terms and conditions of said agreement, and here- 
 by terminate the same; * * * that subsequent to the service of 
 such notice * * * the plaintiff demanded of the vendors the re- 
 turn to him of the $5,000; which he had paid them;" that the ven- 
 
 COBBIN CONT. 47 
 
738 REPUDIATION (Ch. 4 
 
 dors requested of plaintiflE time to consider his demand, and particu- 
 larly to consider the objections which the plaintiff had made to their 
 title to said premises, which request plaintiff granted, and from 
 time to time, at the request of the vendors, extended the time for 
 the vendors to consider plaintiff's demand and the ground of his 
 objection to said title until November 13, 1914, when the vendors, 
 for the first time, notified the plaintiff that they would not return to 
 him the $5,000, or any part of the same. * * * 
 
 The effect of a complete failure and of a defect of title of the ven- 
 dor upon the relations of vendor and vendee has frequently been con- 
 sidered by the courts of this state. Where there has been no fraudu- 
 lent misrepresentation as to the vendor's title, the fact that he has 
 an imperfect title, or no title at all, at the time of the execution of the 
 contract of sale, does not invalidate the contract of sale.*^ Joyce v. 
 Shafer, '^ Cal. 335, 32 Pac. 320; Backman v. Park, 157 Cal. 607, 
 610, 108 Pac. 686, 137 Am. St. Rep. 153; JCrotzer v. Clark, 178 Cal. 
 736, 174 Pac. 657; Kerr v. Reed, 39 Cal. Ap,p. 11, 179 Pac. 399. "In a 
 case such as this it is permissible for one to contract to convey title to 
 land which he does not own, and he is in default under such contract 
 only when the vendee has performed his part of the contract and made 
 demand for a title which the vendor is unable to furnish." Hanson 
 V. Fox, 155 Cal. 106, 99 Pac. 489, 20 L. R. A. (N. S.) 338, 132 Am. St. 
 Rep. 72, quoted with approval in Backman v. Park, supra, 157 Cal. 
 610, 108 Pac. 687, 137 Am. St. Rep. 153. It is sufficient, therefore, if 
 the vendor has good title at the time he is called upon to perform. 
 One-half of the purchase price (inclusive of the initial sum of $5,000) 
 was to be paid 60 days after the execution of the contract. We may 
 assume, as the parties seem to have done, and as we think the contract 
 means, that the vendors were to make the contemplated deed upon 
 such payment of one-half the price. The making of the deed and the 
 payment of that part of the price were therefore dependent arid con- 
 current conditions. In such case, even though time is of the essence 
 of the contract, the vendor cannot put the vendee in default until he 
 has tendered his deed. Boone v. Templeman, 158 Cal. 290, 297, 110 
 Pac. 947, 139 Am. St. Rep. 126, and cases cited ; Sausalito, etc., Co. 
 V. Sausalito Imp. Co.. 166 Cal. 308, 136 Pac. 57. It follows that on 
 Jime 4, 1913, the, vendee was not in default for failure to malce the 
 payment due 60 days from the date of the contract, and that the at- 
 tempt to declare a forfeiture on the theory that the vendee was in de- 
 fault, was unavailing, and that the contract still remained in full force 
 and effect. Boone v. Templeman, supra, 158 Cal. 298, 110 Pac. 947, 
 139 Am. St. Rep. 126. 
 
 Under the circumstances the vendors' notice was, in effect, an un- 
 authorized attempt to abandon the contract. It is true that their ac- 
 
 *' A repudiation by the buyer would make it unnecessary for the seller to 
 acquire title or to clear up defects. Lang v. Hedenberg, 277 111. 368, 115 
 N. E. 566 (1917). 
 
Sec. 4) EFFECT ON OTHER PARTY'S DUTY OF PERFORMANCE 739 
 
 tion was predicated upon the erroneous claim that the vendee was in 
 default for failing to make the 60-day payment. If the vendee, in 
 fact, had been in default, a notice that the contract was terminated 
 would have been proper, and the vendors would be no longer bound 
 either to convey the land or refund the purchase money. Such no- 
 tice would have been in strict accord with the contract. Clock v 
 Howard, 123 Cal. .l,-10, 55 Pac. 713, 43 L. R. A. 199, 69 Am. St. Rep. 
 17; Oursler v. Thatcher, 152 Cal. 739,, 93 Pac. 1007; Skookum Oil 
 Co. V. Thomas, 162 Cal. 539, 549, 123 Pac. 363 ; Cross v. Mavo 167 
 Cal. 594, 140 Pac. 283; Myers v. Williams, 173 Cal. 301, 159 Pac. 
 982. As it was, the vendee immediately upon receiving the vendors' 
 unwarranted notice had the right to treat the same as an abandonment 
 of the contract, and to the return of the installment of the purchase 
 price theretofore paid. Clock v. Howard, supra. The vendee, it is 
 true, delayed his demand for reimbursement, and when made it re- 
 mained under consideration for some months by the vendors, until 
 November 13, 1914, when they finally refused to make such repay- 
 ment and failed to go on with the contract. With reference to the 
 long delay of the vendee in making such demand for reimbursement, 
 it is sufficient to say that the vendors requested delay, and that, al- 
 though the contract was in effect all this time, no effort was made by 
 the vendors to correct the title, or to tender a deed, and they did not 
 withdraw their declaration that the contract was terminated. Hence 
 the legal effect of the demand of the vendee for the return of the pur- 
 chase money paid was the same as though made at once. 
 The judgment is reversed.*^ 
 
 NEW ENCLAND MUT. FIRE INS. CO. v. BUTLER. 
 
 (Supreme Judicial Court of Maine, 1852. 34 Me. 451.) 
 
 Assumpsit. The plaintiffs are a Mutual Fire Insurance Company. 
 On the 24th Nov., 1847, they issued a policy to the defendants for 
 three years, and received their note of that date for $250, "payable in 
 such portions and at such times as the directors may, agreeably to 
 their charter and by-laws, require." By these proceedings, the de- 
 fendants became members of the company. 
 
 By section 10, of the act of incorporation, it is provided, that "all 
 assessments shall be determined by the directors, and shall always be 
 in proportion to the original amount of the deposit note; and any 
 member of said company, or his legal representatives, neglecting or 
 refusing to pay the amount which he may be assessed on his note in 
 
 *8 That a repudiation creates an immediate right to restitution with a 
 correlative money debt in the repudiator, see Ballou v. Billings, 136 Mass. 
 307 (1884) ; Hosmer v. Wilson, 7 Mich. 294, 74 Am. Dec. 716 (1859), semble; 
 Elder v. Chapman, 176 111. 142, 52 N. E. 10 (1898) ; Ryan v. Dayton, 25 
 Conn. 188, 65 Am. Dec. 560 (1856). 
 
740 REPUDIATION CCh. 4 
 
 conformity to this Act, for ttie space of thirty days after demand shall 
 have been made for the payment of the same in manner the said di- 
 rectors shall appoint, shall be liable to the suit of said directors for the 
 i"ecovery of the whole amount of said note with costs of suit." 
 
 On Jan'y 12, 1848, an assessment was duly made for the payment 
 of losses incurred by the company. The amount assessed against the 
 defendants was $4.25. On Jime 7, 1848, they received from the treas- 
 urer a written notice as follows, viz. : 
 
 "Treasurer's Office, Concord, N. H., June 5, 1848. The assessment 
 on your deposit note, amounting to $4.25, which was ordered by the 
 directors on the 12th of Jan'y last, remains unpaid. By a vote of the 
 corporation, passed at the annual meeting on the 23d of May, 1848, 
 your insurance is suspended in thirty days after you have been notified 
 by letter or otherwise, if payment be not made ; and should your prop- 
 erty be destroyed by fire, during such suspension, you will have no 
 remedy ujx)n this company. The directors rely upon the prompt pay- 
 ment of the assessments to meet losses, and if these fail, the members 
 of the company cannot receive their pay when their property is de- 
 stroyed by fire. Be pleased to transmit the amount of your assess- 
 ment at once to the office by mail or otherwise. 
 
 "Yours, &c., Jno. Whipple, Treas." 
 
 An assessment of $33.75, was made on Nov. 15, 1848, and a fur- 
 ther one of $40.00, was made on July 15, 1849. This suit was brought 
 to recover these last two assessments; the amount of the first one, 
 $4.25, having been previously tendered. 
 
 The defence was based upon the notice of the Sth of June, 1848, 
 given as aforesaid to the defendants. 
 
 The case was submitted to the Court for a legal decision. 
 
 Shepley, C. J. The suit is upon a note given by the defendants to 
 the corporation in payment, of so much as should be required, of the 
 premium for a policy of insurance issued to them for the term of three 
 years. It is admitted that they thereby became members of the corpo- 
 ration and liable to be affected by its charter, by-laws, and regulations. 
 And that the assessments claimed were duly made; the last two of 
 which the defendants refused to pay. 
 
 The defence rests upon a notice or communication made on June 5, 
 1848, by the treasurer of the corporation, that by a vote passed at its 
 annual meeting holden on May 23, 1848, their "insurance is suspend- 
 ed in thirty days" after they have been notified, "if payment be not 
 made ; and should your property be destroyed by fire during such sus- 
 pension, you will have no remedy upon this company." 
 
 The argument for the defendants concedes, that the corporation by 
 its charter, or by-laws, or by the conditions of the policy, or of the 
 note, had no right to suspend the risk for neglect of prompt payment 
 of assessments. A mutual insurance company by its contract with one 
 of its members becomes as perfectly bound by the terms of that con- 
 tract, as it would, if made With a stranger. 'The vote of the corpora- 
 
Sec. 4) EFFECT ON OTHER PAETY'S DUTY OF PERFORMANCE 741 
 
 tion can amount to no more, than the declaration of one party to a 
 contract, that he will consider himself discharged from it, if the other 
 party does not perform his part of another contract, which formed the 
 consideration of it. 
 
 When the contracts of the respective parties are not dependent, the 
 omission of one to perform punctually, does not authorize the other to 
 rescind or annihilate his own contract. The policy and the note were 
 independent contracts, neither could be suspended or rescinded by one 
 party without the consent of the other. 
 
 If the defendants had suffered by a loss of their property within the 
 terms of their policy and had claimed an indemnity from the corpora- 
 tion, its own vote passed before that time, that their policy was sus- 
 pended, could have had no effect upon their rights. It could only 
 have, been considered as a vain effort made by a party to relieve itself 
 from its contract without the consent of the other party. And to do 
 it upon terms and in a manner not contained in any charter, by-law or 
 stipulation operative upon both parties. 
 
 It is said, that the vote of the corporation "was a gross and palpable 
 violation of the contract on the part of Ihe company ;" and it is thence 
 inferred, that the other party was discharged. 
 
 The violation of a contract by a party to it, which will discharge 
 another party, must consist of some omission of an act required or 
 commission of one forbidden by it and essential to the continued per- 
 formance of the contract. A mere declaration made by a party, that 
 he will not do a future act, which it has not and may not become his 
 duty to perform, or a mere denial, that upon a future contingency, 
 the other party shall not have any benefit from the contract, is not 
 such a violation of it, as will without the assent of the other destroy 
 its efficacy. 
 
 The defendants might, as the argument for them alleges, have had a 
 right "to take them at their word," if they had notified them, that they 
 consented that the policy should terminate upon the conditions nam- 
 ed in their vote. 
 
 Having continued to the termination of their policy to have the 
 right to enforce it for the recovery of. any loss, that might have occur- 
 red within its terms, they cannot be relieved from the performance 
 of their contract which formed the consideration of it. Defendants 
 defaulted.*' 
 
 *=> That the mutual promises of an aleatory contract of this sort are 
 usually held to be independent, see cases ante, p. 685, 690, note. 
 
742 
 
 REPUDIATION (Ch. 4 
 
 (b) Anticipa'i'ory Repudiation as a Cause ot Action 
 (Including Power of Retraction) 
 
 HOCHSTER V. DE LA TOUR. 
 
 (In the Queen's Bench, 1853. 2 Ellis & Bl. 678.) 
 
 Declaration, "for that, heretofore, to wit on 12th April, 1852, in 
 consideration that plaintiff, at the request of defendant, would agree 
 with the defendant to enter into the service and employ of the defend- 
 ant in the capacity of a courier, on a certain day then to come, to wit, 
 the 1st day of June, 1852, and to serve the defendant in that capacity, 
 and travel with him on the continent of Europe as a courier for three 
 months certain from the day and year last aforesaid, and to be ready 
 to start with the defendant on such travels on the day and year hst 
 aforesaid, at and for certain wages or salary to wit," £10 per month 
 of such service, "the defendant then agreed with the plaintiff, and tlien 
 .promised him, that he, the defendant, would engage and employ the 
 plaintiff in the capacity of a courier on and from the said 1st day of 
 June, 1852, for three months" on these terms ; "and to start on such 
 travels with the plaintiff on the day and year last aforesaid, and to 
 pay the plaintiff" on these terms : averment that, plaintiff, confiding 
 in the said agreement and promise of the defendant, "agreed; with the 
 defendant" to fulfil these terms on his part, "and to be ready to start 
 with the defendant on such travels on the day and year last aforesaid, 
 at and for the wages and salary aforesaid." That, "from the time of 
 the making of said agreement of the said promise of the defendant 
 until the time when the defendant wrongfully refused to perfomi and 
 broke his said promise, and absolved, exonerated, and discharged the 
 plaintiff from the performance of his agreement as hereinafter men- 
 tioned, he, the plaintiff, was always ready and willing to enter into 
 the service and employ of the defendant, in tlie capacity aforesaid, 
 on the said 1st June, 1852, and to serve the defendant in that capacity, 
 and to travel with him on the continent of Europe as a courier for 
 three months certain from the day and year last aforesaid, and to start 
 with the defendant on such travels on the day and year last aforesaid, 
 at and for the wages and salary aforesaid; and the plaintiff, but for 
 the breach by the defendant of his said promise as hereinafter men- 
 tioned, would, on the said 1st June, 1852, have entered into the said 
 service and employ of the defendant in the capacity, and upon the 
 terms and for the time aforesaid; of all which several premises the 
 defendant always had notice and knowledge; yet the defendant, not 
 regarding the said agreement, nor his said promise, afterward and 
 
Sec. 4) ANTICIPATOBy REPUDIATION ASA CAUSE OF ACTION 743 
 
 before the said 1st June, 1852, wrongfully wholly refused and de- 
 clined to engage or employ the defendant in the capacity and for the 
 purpose aforesaid, on or from the said 1st June, 1852, for three 
 months, or on, from or for, any other time, or to start on such travels 
 with the plaintiff on the day and year last aforesaid, or in any manner 
 whatsoever to perform or fulfil his said promise, and then wrongfully 
 wholly absolved, exonerated, and discharged the plaintiff from his 
 said agreement, and from the performance of the same agreement on 
 his, the plaintiff's, part, and from being ready and willing to perform 
 the same on-the plaintiff's part; and the defendant then wrongfully 
 wholly broke, put an end to, and determined his said promise and en- 
 gagement;" to the damage of the plaintiff. The writ was dated on 
 the 22d of May, 1852. 
 
 Pleas: 1. That defendant did not agree or promise in manner and 
 form, etc. ; conclusion to the country. Issue thereon. 
 
 2. That plaintiff did not agree with defendant in manner and form, 
 etc. ; conclusion to the. country. Issue thereon. 
 
 3. That plaintiff was not ready and willing, nor did defendant ab- 
 solve, exonerate, or discharge plaintiff from being ready and willing, 
 in manner and form^ etc. ; conclusion to the country. Issue thereon. 
 
 4. That defendant did not refuse or decline, nor wrongfully ab- 
 solve, exonerate, or discharge, nor wrongfully break, put an end to 
 or determine, in manner and form, etc.; conclusion to the country. 
 Issue thereon. 
 
 On the trial, before Erie, J., at the London sittings in last Easter 
 Term, it appeared that plaintiff was a courier, who, in April, 1852, 
 was engagfed by defendant to accompany him on a tour to commence 
 on June 1st, 1852, on the terms mentioned in the declaration. On May 
 1 1th, 1852, defendant wrote to plaintiff that he had changed his mind, 
 and declined his services. He refused to make him any compensation. 
 The action v/as commenced on May 22d. The plaintiff, between the 
 commencement of the action and June 1st, obtained an engagement 
 with Lord Ashburton, on equally good terms, but not commencing till 
 July 4th. The defendant's counsel objected that there could be no 
 breach of the contract before the 1st of June. The learned judge was 
 of a contrary opinion, but reserved leave to enter a nonsuit on this 
 objection. The other questions were left to the jury, who found for 
 plaintiff. 
 
 Hugh Hill, in the same term, obtained a rule nisi to enter a nonsuit 
 or arrest the judgment. In last Trinity Term, 
 
 Hannen showed cause. * * * If one party to an executory con- 
 tract gave the other notice that he refused tO' go on with the bargain, 
 in order that the other side might act upon that refusal in such a 
 manner as to incapacitate himself from fulfilling it, and he did so act, 
 the refusal could never be retracted ; and, accordingly, in Cort v. Am- 
 bergate &c. R. Co. (17 Q. B. 127) this court after considering the 
 cases, decided that in such a case the plaintiff might recover, though 
 
744 REPUDIATION ^ (Ch. 4 
 
 he was no longer in a position to fulfil his contract. ' That was a con- 
 tract under seal to manufacture and supply iron chairs. The pur- 
 chasers discharged the vendors from manufacturing the goods; and 
 it was held that an action might be maintained by the vendors. It is 
 true, however, that in that case the writ was issued after the time 
 when the chairs ought to have been received. In the present case, if 
 the writ had been issued on the 2nd of June, Cort v. Ambergate &c. R. 
 Co. would have been expressly in point. The question, therefore, 
 comes to be: Does it make any difference that the writ was issued 
 before the 1st of June? If the dicta of Parke, B., in Phillpotts v. 
 Evans, 5 M. & W. 475, are to be taken as universally applicable it 
 does make a difference; but the)' cannot be so taken. In a contract 
 to marry at a future day, a marriage of the man before that day is a 
 breach. Short v. Stone, 8 Q. B. 358. The reason of this is, that the 
 marriage is a final refusal to' go on with the contract. It is not on the 
 ground that the defendant has rendered it impossible to fulfil the con- 
 tract; for, as was urged in vain in Short v. Stone, the first wife 
 might be dead before the day came. So also, on a contract to assign 
 a term of years on a day future, a previous assignment to a stranger is 
 a breach. Lovelock v. Fra:nklyn, 8 Q. B. 371. [Lord Campbbli,, C. 
 J. It probably will not be disputed that an act on the part of the de- 
 fendant incapacitating himself from going on with the contract 
 would be a breach. But how does the defendant's refusal in May in- 
 capacitate him from travelling in June? It was possible that he might 
 do so.] It was; but the plaintiff, who, so long as the engagement 
 subsisted, was bound to keep himself disengaged and make prepara- 
 tions so as to be ready and willing to travel with the defendant on the 
 1st of June, was informed by the defendant that he would not go on 
 with the contract,, in order that the plaintiff might act upon that in- 
 formation; and the plaintiff then was entitled to engage himself to 
 another, as he did. In Planche v. Colbum (8 Bing. 14) the plaintiff 
 had contracted with defendants to write a work for "The Juvenile Li- 
 brary;" and he was held to be entitled to recover on their discon- 
 tinuing the publication; yet the time for the completion of the con- 
 tract, that is for the work being published in "The Juvenile Library," 
 had not arrived, for that would not be till a reasonable time after the 
 author had completed the work. Now in that case the author never 
 did complete the work. [Lord Campebi^l, C. J. It certainly would 
 have been cruelly hard if the author had been obliged, as a condition 
 precedent to redress, to compose a work which he knew could never 
 be published. Crompton, J. When a party announces his intention 
 not to fulfill the contract, the other side may take him at his word 
 and rescind the contract. That word "rescind" implies that both par- 
 ties have agreed that the contract shall be at an end as if it had never 
 been. But I am inclined to think that the party may also say: "Since 
 you have announced that you will not go on with the cohtract, I will 
 consent that it shall be at an end from this time ; but I will hold you 
 
Sec. 4) ANTICIPATORY REPUDIATION AS A CAUSE OP ACTION 745 
 
 liable for the damage I have sustained; and I will' proceed to make 
 that dahiage as Httle as possible by making the best use I can of my; 
 liberty." This is the principle of those cases in which there has been, 
 a discussion as to the measure- of damages to which a servant is en- 
 titled on a wrongful dismissal. They were all considered in Elderton 
 V. Emmens (6 C. B. 160). Lord CAMrBP,i,i„ C. J. The counsel in 
 support of the rule have to answer a very able argument.] 
 
 Hugh Hill and Deighton, contra. In Cort v. Ambergate &c. R. Co., 
 the writ was taken out after the time for completing the contract. That 
 case is consistent with the defendant's position, which is, that an act 
 incapacitaiting the defendant, in law, from completing the contract is 
 a breach, because it is implied that the parties to- a contract shall keep, 
 themselves legally capable of performing it ; but that an announcement 
 of an intetition to break the contract when the time comes is no more 
 than an offer to rescind. It is evidence, till retracted, of a dispensation 
 with the necessity of readiness and willingness on the other side ; and, 
 if not retracted, it is, when the time for performance comes, evidence 
 of a continued refusal ; but till then it may be retracted. Such is the 
 doctrine in Phillpotts v. Evans (5 M. & W. 475) and Ripley v. Mc- 
 Clure (4 Exch. 345). [Crompton, J. May not the plaintiff, on no- 
 tice that the defendant will not employ him, look out for other employ- 
 ment, so as to diminish the loss ?] If he adopts the defendant's notice, 
 which is in legal effect an offer to rescind, he must adopt it altogether. 
 [Lord Campbell, C. J. So that you say the plaintiff, to preserve any 
 remedy at all, was bound to remain idle. ErlE, J. Do you go one step 
 further? Suppose the defendant, after the plaintiff's engagement with 
 Lord Ashburton, had retracted his refusal and required the plaintiff 
 to travel with him on the 1st of June, and the plaintiff had refused to 
 do so, and gone with Lord Ashburton instead? Do you say that the 
 noW defendant could in that case have sued the now plaintiff for a 
 breach of contract?] It would be, in such a case, a question of fact 
 for a jury, whether there had not been an exoneration. In Phillpotts 
 V. Evans, it was held that the measure of damages was the market price 
 at the time when the contract ought to be completed. If a refusal 
 before that time is a breach, how could these damages be ascertaiiied ? 
 [Coleridge, J. No doubt it was possible, in this case, that, before the 
 1st of June, the plaintiff might die, in which case the pkintiff would 
 have gained nothing had the contract gone on. Lord Campbell, C. J. 
 All contingencies should be taken into account by the jury in assessing 
 the damages. Crompton, J. That objection would equally app;ly to 
 the action by a servant for dismissing him before the end of his term, 
 and so disabling him from earning his wages ; yet that action may be 
 brought immediately on the dismissal; note to Cutter v. Powell (6 T. 
 R. 320)]. It is quite possible that the plaintiff himself might have in- 
 tended not to go on; no one can tell what intention is. [Lord Camp- 
 bell, C. J- The intention of the defendant might be proved by show- 
 
746 REPUDIATION (Ch. 4 
 
 ing that he entered in his diary a memorandum to that effect ; and, cer- 
 tainly, no action would lie for entering such a memorandum. But the 
 question is as to the effect of a communication to the other side, made 
 that he might know that intention and act upon it.] 
 
 Cur. adv. vult. 
 
 Lord Campbell, C. J., now delivered the judgment of the Court. 
 
 On this motion in arrest of judgment, the question arises. Whether, 
 if there be an agreement between A and B, whereby B engages to 
 employ A on and from a future day for a given period of time, to 
 travel with him into a foreign country as a courier, and to start with 
 him in that capacity on that day, A being to receive a monthly salary 
 during the continuance of such service, B may, before the day, re- 
 fuse to perform the agreement and break and renounce it, so as to 
 entitle A before the day to commence an action against B to recover 
 damages for breach of the agreement ; A having been ready and will- 
 ing to perform it, till it was broken and renounced by B. The defend- 
 ant's counsel very powerfully contended that, if the plaintiff was not 
 contented to dissolve the contract and to abandon all remedy upon it, 
 he was bound to remain ready and willing to perform it till the day 
 when the actual employment as courier in the service of the defend- 
 ant was to begin; and that there could be no breach of the agree- 
 ment before that day to give a right of _action. But it cannot be laid 
 down as a universal rule that, where by agreement an act is to be 
 done on a future day, no action can be brought for a breach of the 
 agreement till the day for doing the act has arrived. If a man prom- 
 ises to marry a woman on a future day, and before that day marries 
 another woman, he is instantly liable to an action for breach of prom- 
 ise of marriage. Short v. Stone (8 Q. B. 358). If a man contracts to 
 execute a lease on and from a future day for a certain term, and be- 
 fore that day executes a lease to another for th? same term, he may 
 be immediately sued for breaking the contract. Ford v. Tiley (6 B. 
 & C. 325). So, if a man contracts to sell and deliver specific goods 
 on a future day, and before the day he sells and delivers them to 
 another, he is immediately liable to an action at the suit of the person 
 with whom' he first contracted to sell and deliver them. Bojwdell v. 
 Parsons (10 East, 359). One reason alleged in support of such an 
 action is, that the defendant has, before the day, rendered it imposr 
 sible for him to perform the contract at the day, but this does not 
 necessarily follow; for prior to the day fixed for doing the act, the 
 first' wife niay have died, a surrender of the lease executed might' be 
 obtained, and the defendant might have repurchased the goods so as 
 to be in a situation to sell and deliver them to the plaintiff. Another 
 reason may be that, where there is a contract to do an act on a future 
 day, there is a relation constituted between the parties in the mean- 
 titne by the contract, and that they impliedly promise that in the 
 nleantime' neither will do anything to the prejudice of the other incon- 
 sistent with that relation. As an exarriple, a man and woman en- 
 
Sec. 4) ANTICIPATORY REPUDIATION AS A CAUSE OP ACTION 747 
 
 gaged to marry are affianced to one another during; the period be- 
 tween the time of the engagement and the celebration of the mar- 
 riage. 
 
 In this very case of traveller and courier, from the day of the 
 hiring till the day when the employment was to begin, they were en- 
 gaged to each other ; and it seems to be a breach of an implied con- 
 tract if either of them renounces the engagement. This reasoning 
 seems in accordance with the unanimous decision of the Exchequer 
 Chamber in Elderton v. Emmens (6 C. B. 160), which we have followed 
 in subsequent cases in this court. The declaration in the present case, 
 in alleging a breach, states a great deal more than a passing intention 
 on the part of the defendant which he may repent of, and could only 
 be proved by evidence that he had utterly renounced the contract, 
 or done some act which rendered it impossible for him to perform it. 
 
 If the plaintiff has no remedy for breach of the contract unless he 
 treats the contract as in force, and acts upon it down to the 1st of 
 June, 1852, it follows that, till then, he must enter into no employment 
 which will interfere with his promise "to start with the defendant on 
 such travels on the day and year," and that he must then be properly 
 equipped in all respects as a courier for a three months' tour on the 
 continent of Europe. But it is surely much more rational, and more 
 for the benefit of both parties, that, after the renunciation of the 
 agreement by the defendant, the plaintiiif should be at liberty to con- 
 sider himself absolved from any future performance of it, retaining 
 his right to sue for any damage he has suffered from' the breach of it. 
 Thus, instead of remaining idle and laying out money in preparations 
 which must be useless, ;he is at liberty to seek service under another 
 employer, which would go in mitigation of the damages to which he 
 would otherwise be entitled for a breach of the contract. It seems 
 strange that the defendant, after renouncing the contract, and abso- 
 lutely declaring that he will never act under it, should be permitted to 
 - object that faith is given to his assertion, and that an opportunity is 
 not left to him of changing his mind. If the plaintiff is barred of 
 any remedy by entering into an engagement inconsistent with start- 
 ing as a courier with the defendant on the 1st of June, he is prejudiced 
 by putting faith in the defendant's assertion, and it wquld be more 
 consonant with principle, if the defendant were precluded from saying 
 that he had not broken the contract when he declared- that he entirely 
 renounced it. 
 
 Suppose , that the defendant, at the time of his renunciation, had 
 embarked on a voyage for Australia, so as to render it physically 
 impossible for him to employ the plaintiff as a courier on the con- 
 tinent of Europe in the months of June, July, and August, 1852, 
 according to decided cases, the action might .have been brought be- 
 fore the 1st of June ; but the renunciation may have been founded on 
 other facts, to be given in evidence, which would equally hav? ren- 
 dered the defendant's performance of the contract impossible. The 
 
748 REPUDIATION (Gh. 4 
 
 man who wrongfully renounces a contract into which he has deliber- 
 ately entered cannot justly complain if he is immediately sued for a 
 compensation in damages by the man whom he has injured; and it 
 seems reasonable to allow an option to the injured party, either to 
 sue immediately, or to wait till the time when the act was to be 
 done, still holding it as prospectively binding for the exercise of this 
 option, which may be advantageous to the innocent party, and can- 
 not be prejudicial to the wrongdoer. An argument against the action 
 before the 1st of June is urged from the difKtfulty of calculating the 
 damages, but this argument is equally strong against an action before 
 the 1st of September, when the three months would expire. In either 
 case, the jury in assessing the damages would be justified in looking 
 to all that had happened, or was likely to happen, to increase or miti- 
 gate the loss of the plaintiff down to the day of trial. We do not find 
 any decision contrary to the view we are taking of this case. Leigh 
 V. Patterson (8 Taunt. 540) only shows that, upon a sale of goods 
 to be delivered at a certain time, if the vendor before the time gives 
 information to the vendee that he cannot deliver them, having sold 
 them, the vendee may calculate the damages according to the state 
 of the market when they ought to have been delivered. If this was a 
 sale of specific goods, thd action, according' to Bowdell v. Parsons (10 
 East, 359), might have been brought before that time, as soon as the 
 vendor had sold and delivered them to another. Phillpottfe v. -Evans 
 (5 M. & W. 475) was a similar case, and the only question there was 
 as to the mode of calculating the damages on a breach of contract for 
 the sale and delivery of wheat; the Court very properly holding that 
 the plaintiff was entitled to damages according to the state of the 
 market when the wheat was to be delivered ; the Court professing to 
 proceed upon the rule laid down in Startup v. Cortazzi (2 C. M. & R. 
 165), where no question arose as to the right to bring an action before 
 the stipulated day of 'delivery on a renunciation of the contract. 
 Parke, B., whose dicta are entitled to Very great weight, certainly 
 does say in Phillpotts v. Evans, with reference to the notice by the 
 defendants that they would not accept the corn: "I think no action 
 would then have lain for the breach of the contract, but that the plain- 
 tiffs were bound to wait until the time arrived for delivery of the 
 wheat, to see whether the defendant would then receive it." But the 
 learned judge might suppose that the notice did not amount to a re- 
 nunciation of the contract; and, if he thought that, after such a re- 
 nunciation, the plaintiffs were bound to proceed with the performance 
 of the contract on their part, and to incur expense and loss in tender- 
 ing the wheat before they could have any remedy on the contract, we 
 cannot agree with him; In Ripley v. M'Clure (4 Exch. 345) it is said 
 that, under a contr-act for the sale and delivery of goods, a refusal to 
 receive them at any time before they ought to be delivered was not 
 necessarily a breach of the contract; but the court intimated no opin- 
 ion upon the question whether, there bfeing a contract to do an act at 
 
Sec. 4) ANTICIPATOET REPUDIATION AS A CAUSE OF ACTION 749 
 
 a future day, if one party before the day renounces the contract, the 
 other thereupon has a remedy for a breach of the contract. And they 
 held that a refusal by one party before the day when, the act is to be 
 done, if unretracted, would be evidence of a continual refusal down 
 to, and inclusive of, the time when the act was to be done. 
 
 The only other case cited in the argument which we think it necessary 
 • to notice is Planche v. Colbum, (8 Bing. 14) which appears to be ah 
 authority for the plairitiflf. There the defendants had engaged the 
 plaintiff to write a treatise for a periodical publication. The plaintiff 
 commenced the composition of the treatise ; but, before he had com- 
 pleted it, and before the time when in the course of conducting the 
 publication it would have appeared in print, the publication was 
 abandoned. The plaintiff thereupon, without completing the treatise, 
 brought an action for breach of contract. Objection Was made that 
 the plaintiff could not recover on the special contract for want of hav- 
 ing completed, tendered, and delivered the treatise, according to the 
 contract. Tindal, C. J., said : "The fact was, that the defendants not 
 only suspended, but actually put an end to, 'The Juvenile Library;' 
 they had broken their contract with the plaintiff." The declaration 
 contained counts for work and labour: but the plaintiff appears to 
 have retained his verdict on the count framed on the special contract, 
 thus showing that, in the opinion of the court, the plaintiff might 
 treat the renunciation of the contract by the defendants as a breach, 
 and maintain an action for that breach, without considering that it 
 remained in force so as to bind him to perform his part of it before 
 bringing an action for the breach of it. If it should be held that, upon 
 a contract to do an act on a future day, a renunciation of the contract 
 by one party dispenses with a condition to be performed in the mean- 
 time by the other, there seems no reason for requiring that other to 
 wait till the day arrives before seeking his remedy by action, and the 
 only ground on which the condition can be dispensed with seems to 
 be, that the renunciation may be treated as a breach of the contract. 
 
 Upon the whole, we think that the declaration in this case is suffi- 
 cient. It gives us great satisfaction to reflect that, the question being 
 on the record, our opinion may be reviewed in a court of error. In 
 the meantime we must give judgment for the plaintiff. 
 
 Judgment for plaintiff.^* 
 
 5 In accord: Eoehm v. Horst,. 178 U. S. 1, 20 Sup. Ct. 780, 44 L. Ed. 953 
 (1900), citing other cases; Colorado Yule Marble Co. v. CoUins, 144 C. O. A. 
 376, 230 Fed. 78 (1915) ; Weber v. Grand Lodge of Kentucky, F. & A. M., 
 169 Fed. 522, 95 C. C. A. 20 (1909) ; Fox v. Katton, 19 111. 519 (1858) ; B. B. 
 Ford & Co. V. Lawson, 133 Ga. 237, 65 S. E. 444 (1909) ; Kurtz v. Frank, 
 76 Ind. 594, 40 Am. Kep. 275 (1881) ; Piatt v. Brand, 26 Mich. 173 (1872) ; 
 liistman Mill Co. v. Dufresne, 111 Me. 106, 88 Atl. 354 (1913) ; Kalkhofe v. 
 Nelson, 60 Minn. 284, 62 N. W. 332 (1895) ; Holt v. United Security Life Ins. 
 Co., 76 N. J. Law, 585, 72 Atl. 301, 21 L. R. A. (N. S.) 691 (1909) ; Windmuller 
 V. Pope, 107 N. T. 674, 14 N. E. 436 (1887)^ ; Wester v. Casein Co., of America, 
 206 N. Y. 506, 100 N. E. 488, Ann. Gas. 1914B, 377 (1912) ; Hart-Parr Co. v. 
 Finley, 31 N. D. 130, 153 N. W. 137, L. E. A. 1915E, 85i; Ann. Cas. 1917B, 706 
 
750 KBPUDIATION (Gh. 4: 
 
 DINGLEY et al. v. OLER et al. 
 
 (Supreme Court of the United States, 1886. 117 V. S. 490, 6 Sup. Ct. 850, 
 
 29 L. Ed. 984.) 
 
 MaTthbws, J.°^ This was an action of assumpsit, brought by Ding- 
 ley Bros, in the superior court of the county of Kennebec, in Maine, 
 against W. M. Oler & Co., of Baltimore, to recover damages for the 
 alleged breach of an agreement, whereby it was averred the defend- 
 ants undertook and promised, in consideration of 3,245.25 tons of ice 
 delivered to them by the plaintiffs in 1879, to return and deliver to 
 the plaintiffs the same quantity of ice from the defendants' ice-houses, 
 in the year 1880. The case was removed by the defendants into the 
 circuit court of the United States for the district of Maine, when the 
 cause was put at issue by a plea of non assumpsit, and was submitted 
 to the court by the parties, the intervention of a jury having been 
 duly waived. The court made a special finding of the facts, and, in 
 pursuance of the conclusions of law based thereon, rendered judg- 
 ment in favor of the plaintiffs for the sum of $7,335.35. Exceptions 
 were taken by each party to rulings of the court, on which errors are 
 assigned, the cause being brought here for review on writs of error 
 sued out by the respective parties. The court found as matter of fact, 
 that late in the season of 1879 the plaintiffs, finding themselves in 
 possession of a large quantity of ice undisposed of, and which threat- 
 ened to be a total loss, pressed the defendants to buy some or all of it. 
 Both parties were dealers in ice, cutting it upon the Kennebec river, 
 and shipping it thence during the season; that is, while the river is 
 open. The offers of the plaintiffs were rejected, but the defendants, 
 by their letter of sixth September, 1879, made a counter offer to take 
 a cargo and "return the same to you next year fro^m our houses." 
 The plaintiffs, by their letter of September, 1879, accepted this offer, 
 and several cargoes were delivered upon the same terms. The total 
 delivery was 3,245.25 tons. 
 
 In July, 1880, one of the plaintiffs spoke to one of the defendants 
 about delivering the ice; and he replied' that he did not know about 
 
 (1915) ; Frost v. Knight, L. K. 7 Ex. Ill (1872) defendant promised to 
 marry plaintiff after the death of defendant's father ; suit brought at once 
 when defendant married another woman, although the father was still living. 
 
 Bankruptcy, making performance impossible, is a breach by anticipation, 
 and creates an immediate right, provable in the bankruptcy proceedings. 
 Central Trust Co. of Illinois v. Chicago Auditorium Ass'n, 240 U. S. 581, 36 
 Sup. Ot. 412, 60 L. Ed. 811, L. R. A. 1917B, 580 (1916) ; Board of Commerce 
 of Ann Arbor, Mich., v. Security Trust Co., 225 Fed. 454, 140 C. C. A. 486 
 (1915) ; In re NefC, 157 Fed. 57, 84 C. C. A. 561, 28 L. E. A. (N. S.) 349 
 (1907). 
 
 One has no right of action merely because he has reason to anticipate that 
 the other will be unable to- perform on time, and this is true, even though time 
 is of the essence. Brady v. Oliver, 125 Tenn. 595, 147 S. W. 1135, 41 L. R. A. 
 (N. S.) 60, Ann. Cas. 1913C, 376 (1911). 
 
 "1 Part of opinion omitted. 
 
Sec. 4) ANTICIPATORY REPUDIATION AS A CAUSE OF ACTION 751 
 
 that, — delivering ice when it was worth five dollars a ton, which they 
 had taken when it was worth fifty cents a ton, but he promised to 
 write an answer. July 7, 1880, the defendants wrote, repeating their 
 objections, and saying, among other things, "we must therefore de- 
 cline to ship the ice for you tWs season, and claim' as our right to pay 
 you for the ice in cash at the price you offered other parties here, 
 (that is, fifty cents,) or give you ice when the market reaches that 
 point." The plaintiffs, tenth July, 1880, wrote that they had a right 
 to the ice, and had sold it in expectation of its delivery, to which the 
 defendants answered fifteenth July, 1880, reciting the circumstances 
 of the case, and the hardship of such a demand, and again denying 
 the obligation. The letter contains this sentence : "We cannot, there- 
 fore, .comply with your request to deliver the ice claimed, and re- 
 spectfully submit that you ought not to ask this of us," etc., asking 
 for a reply or a personal interview. Neither appears to have been 
 given, and this action was commenced July 21, 1880. The court fur- 
 ther found that ice was worth five dollars a ton in July, 1880, and fell 
 later in the season to two dollars a ton. 
 
 Thereupon the court held, as matter of law, that there was a con- 
 tract executed by the' plaintiffs, and to be exiecuted by the defendants, 
 who were bound to deliver 3,245.25 tons of ice from their houses on 
 the Kennebec river during the year 1880; that the year means the 
 shipping season; and that the defendants had the whole season, if 
 they chose to demand it, in which to make delivery; and that the 
 letters of July 7th and 15th, from the defendants to the plaintiffs, con- 
 tained an unequivocal refusal to deliver any ice during the season; 
 that the defendants having unqualifiedly refused to ship the ice, this 
 action, can be maintained, though brought before the close of the sea- 
 son, but that the damages are not to be -reckoned by the price of ice 
 in July; that what the plaintiffs lost was 3,245.25 tons of ice some- 
 time during the season ; that the price of ice went down after July to 
 two dollars a ton, and the measure of damages must be reckoned at 
 this fate, with , interest from the date of the writ.' 
 
 To these conclusions of law the plaintiffs below excepted, con- 
 tending that the right to fix the time for delivery under the contract 
 had vested in them; that it was properly exercised by their demand 
 in July, 1880; that the refusal to deliver at that time constituted the 
 breach of the contract by the defendants, and fixed the damages at 
 five dollars per ton, the market value of the ice on that day. 
 
 The defendants below excepted, contending on their part that the 
 letters hi July 7th and 15th did not constitute an unequivocal refusal 
 to deliver any ice during the season, amounting to a renunciation, 
 and, in that sense, a breacn of the contract; and that the action was 
 prematurely brought, the right of action, if any, not accruing until 
 after the expiration of the period within which, by the terms of the 
 contract, they had the option to deliver. 
 
752 ' EBPUDIATION (Ch. i 
 
 The letter of July 7, 1880, from the defendants to the plaintififs, is 
 ■as follows: . ; . .:• ... 
 
 "Baltimore, Md., seventh July, 1880. 
 "Messrs. Dingley Bros., Gardiner, Me. — Dear Sifs: As per prom- 
 ise of our W. M. O., we write you cfencerning' the ice we got from 
 you last fall. We have before us the whole of the correspondence on 
 that head, and note throughout the same that you promise to stand 
 between us and any loss. We quot6 from yours of September 9, 1879, 
 on this head, as follows : 'In fact, we do not propose for you to be- 
 come losers on account of extending us this accommodation.' Our 
 W. H. O. does not remember your having spoken to him while at 
 Gardiner about your intention of selling the ice, and was very much 
 surprised when informed that you had done so. We are very sorry, 
 indeed, that this question should have arisen between us, who have 
 been on such friendly terms hitherto; but we feel that it is not just 
 or equitable for you (in consideration of the ice being used by us 
 only upon your earnest solicitation, and upon your representation 
 that you would lose the whole unless we assisted you by taking some) 
 to expect us to give you ice now worth $5 per ton when we have let- 
 ters of yours offering the ice that we got at fifty cents per ton. We 
 must therefore decline to ship the ice for you this season, and claim' 
 as our right to pay you for the ice, in cash, at the price you offered 
 it to other parties here, or give you ice when the market reaches "that 
 point. Again expressing our sincere regret that any complication 
 should arise between us, and assuring you of our innocence in the 
 matter, we are, 
 
 "Yours, truly, W. M. Oler & Co." 
 
 The letter was answered by Dingley Bros., on July 10, as follows : 
 
 "Gardiner, July 10, 1880. ' 
 
 "Messrs. W. M. Oler & Co., Baltimore— Dear Sirs : Yours of 7th 
 is in hand, and we must say the conclusion you have come to greatly 
 astonishes us. Our sole object in making this exchange, no one 
 knows better than yourselves, was to tide us over to such a time dur- 
 ing this season as the ice could be marketed at some reasonable 
 figure, and in confirmation of this we refer you to your proposition, 
 made under date of September 6th, viz. : 'It would, of course, be more 
 convenient for us to ship this cargo from our .own houses ; but re- 
 membering past favors, we feel inclined to assist you in your present 
 difficulty, and will load this cargo from your house, should our terms 
 be agreeable to you. We, of course, do not entertain the idea of 
 buying, having a superabundance on hand, but will take this cargo, 
 and return same to you next year from our houses.' Upon this we 
 have acted, and in the utmost good faith made sale of the ice; and 
 now, after all of this, and having refused to buy it yourselves, for you 
 to ask a postponement in the delivery seems to us hairdly, right, Now, 
 whatever the final settlement of this matter is to be, we want you to 
 
Sec. 4) ANTICIPATORT REPUDIATION AS A CAUSE OP ACTION 753 
 
 fill our order; otherwise, we cannot tell what the result might be. 
 It is not in our minds to do otherwise than right with any one, and 
 certainly with yourselves ; and it is our great desire not to get com- 
 plicated with the third party in that matter ; and assure you that your 
 regrets cannot exceed ours that there should have arisen any differ- 
 ence of opinion concerning this affair, and certain it is that neither of 
 us can afford to do wrong by the other in it; and hoping you will 
 take a more favorable view upon further reflection, we remain, ' 
 
 ."Truly yours, Dingley Bros." 
 
 • The defendants' letter of July 15th was in reply to this, and is as 
 follows : 
 
 "Bahimore, Md., fifteenth July, 1880. 
 "Messrs. Dingley Bros., Gardiner, Me. — Gentlemen: Yours of 
 10th duly received, and in reply would sta,te that our desire to do 
 right is quite as sincere and earnest as your own, and that we regret 
 our inability to see the matter referred to in the same form in which 
 you state it. The case, briefly stated, appears to us thus, as we think 
 the correspondence of last year will show : being very much troubled 
 with the quantity of ice left on your hands by an unfortunate contract 
 with the Messrs. Barker, you repeatedly urged and importuned us to 
 help you out, and promised us if we would do so that no loss should 
 result to us from the transaction. Under these assurances, we at 
 length agreed, purely for your accommodation and relief, to take one 
 cargo, and later, under the same influences, took more. Now you 
 ask us, at a time when we are pressed by our sales and by short 
 supply, threatening us and others, to deliver to you the equivalent in 
 tons of the ice taken' from you under the circumstances stated. This 
 does not seem to us to be fair, and certainly does not comport or 
 agree in any way with your agreement to protect us from loss by 
 means of the favor we were intending to do you. We are reluctant 
 to have a disagreement or difference of opinion with old friends, but 
 regard it our duty to protect our own interests, always, however, with 
 a proper regard to the dictates of right. We cannot, therefore, com- 
 ply with your request to deliver to you the ice claimed, and respect- 
 fully submit that you ought not to ask this of us in view of the fact 
 stated herein and in ours of the 7th. You do not reply to our argu- 
 ments, but simply ask us to surrender our well-formed opinion. Can 
 you reasonbly ' ask us to do this ? Is not your usually clear and 
 equitable judgment clouded by the manifest considerations of self- 
 interest pressing upon you? We beg you to consider anew all the 
 circumstances pi the transaction and your assurances tO' us as induce- 
 ments to make it with you, and cannot doubt that you will be led 
 thereby to admit that your request is not reasonable. We will be 
 glad to hear from you in reply, but would be more pleased to have a 
 personal inierview, and venture to suggest tha.t you corne here for the 
 purpose. Our business is now more active and confining than ever 
 
 CORBIN CONT 48 
 
754 REPUDIATION CCh, 4 
 
 before. We are deprived of the services of W. Geo., and therefore 
 Cannot come to see you. With regards, we are, 
 
 "Yours truly, W. M. Oler & Co." ' 
 
 To this letter no answer was returned, and the present suit was 
 brought six days after its date. 
 
 We agree in opinion with the circuit court that, according to the 
 terms of the contract, the defendants had the option of delivering the 
 ice contracted for at any time during the whole shipping season of 
 1880, giving to the plaintiffs reasonable notice of the time when fixed, 
 and an opportunity to prepare for receiving and taking it away from 
 the defendants' houses. * * * 
 
 We differ, however, from the opinion of the circuit court that the 
 defendants are to be considered, from" the language of their letters 
 above set out, as having renounced the contract by a refusal to perform, 
 within the meaning of the rule which, it is assumed, in such a case, 
 confers upon the plaintiffs a right of action before the expiration of 
 the contract period for performance. We do not so construe the cor- 
 respondence between the parties. In the letter of July 7th the defend- 
 ants say: "We must therefore decline to ship the ice for you this 
 season, and claim, as our right, to pay you for the ice, in cash, at the 
 price you offered it to other parties here, or give you ice when the mar- 
 ket reaches that point." Although in this extract they decline to ship 
 the ice that season, it is accompanied with the expression of alternative 
 intention, and that is, to ship it, as must be understood, during that 
 season, if arid when the market price should reach the point which, in 
 their opinion, the plaintiffs ought to be willing to accept as its fair price 
 between them. It was not intended, we think, as a final and absolute 
 declaration that the contract must be regarded as altogether off, so 
 far as their performance was concerned, and it was not so treated by 
 the plaintiffs; for, in their answer of July 10th, they repeat their de- 
 mand for delivery immediately, speak of the letter of the 7th instant 
 as asking "for a postponement of the delivery," urge them "to fill our 
 order," and close with "hoping you [the defendants] will take a more 
 favorable view upon further reflection," etc. Here, certainly, was a 
 locus penitentise conceded to the defendants by the plaintiffs them- 
 selves, and a request for further consideration, based upon a renewed 
 demand, instead of. abiding by and standing upon the previous one. 
 
 Accordingly, on July 15th, the defendants replied to the demand 'for 
 an immediate delivery to meet the exigency of the plaintiffs' sale of the 
 same ice to others, and the letter is evidently and expressly confined to 
 an answer to the particular demand for a delivery at that time. They 
 accordingly say : "Now, you ask us at a time when we are pressed by 
 our sales, and by short supply, threatening us and others, to deliver to 
 you the equivalent in tons of the ice taken from you under the cir- 
 cumstances stated : This does not seem to us to be ^fair," etc. "We 
 cannot, therefore, comply with your request to deliver to you the ice 
 
Sec. 4) ANTICrPATOET REPUDIATION AS A CAUSE OF ACTION 755 
 
 claimed, and respectfully submit that you ought not to ask this of us 
 in view of the fact stated herein, and in ours of the 7th." This, we 
 think, is very far from being a positive, unconditional, and unequivocal 
 declaration of fixed purpose not to perform the contract in any event 
 or at any time. In view of the consequences soug'ht to be deduced and 
 claimed as a matter of law to follow, the defendants have a right to 
 claim that their expressions, sought to be converted into a renunciation 
 of the contract, shall not be enlarged by construction beyond their 
 strict meaning. 
 
 [The court here discussed several authorities, and quoted Benjamin 
 on Sales, 424, that "a mere assertion that the party will be unable or 
 will refuse to perform his contract is not sufficient. It must be a dis- 
 tinct and unequivocal absolute refusal to perform the promise, and 
 must be treated and acted upon as such by the party to whom the 
 promise was made ; for, if he afterwards continue to urge or demand 
 a compliance with the contract, it is plain that he does not understand 
 it to be at an end."] 
 
 The judgment is accordingly reversed upon the writ of error sued 
 out by the defendants below, and the cause remanded, with instruc- 
 tions to take further proceedings therein according to law; and upon 
 the writ of error of plaintiffs below, judgment will be given that they 
 Jake nothing by their writ of error. ^- 
 
 DANIELS v. NEWTON. 
 
 (Supreme Judicial Court of ' Massachusetts, 1874. 114 Mass. 530, 19 Am. 
 
 Kep. 384.) 
 
 Wells, J. This action is for breach of an agreement in writing, 
 under seal, for the purchase of certain land from the plaintiff by the 
 defendants. The time for performance is indicated by two clauses; 
 one that "said premises are to be conveyed within thirty days from this 
 date;" the other that "in case the said parties of the second part 
 should fail to sell their estate at the expiration of the thirty days, then 
 we agree to extend this agreement for thirty days." The inference 
 from the latter clause is that the defendants were to have the whole 
 thirty days for performance on their part, and in the contingency 
 mentioned, thirty days more. Such was the effect given to the terms 
 of the written instrument, by the ruling at the trial, and we think cor- 
 rectly. 
 
 The plaintiff relied upon a supposed breach of the agreement by the 
 defendants within the thirty days ; to wit, May 29, the writing being 
 dated May 15, and thereupon had brought his action May 30. The 
 ruling of the court upon this point was that if the defendants "fixed a 
 
 62 See, also, Hasler v. West India S. S. Co., 212 ;Fed. 862, 129 0. C. A. 382 
 (1014) ;' Hoggson Bros, v, first Nat. Bank of Roswell, 146 C. C. A. 65, 231 
 Fed. 869 (1916) ; Edwards v. Proctor, 173 N. C. 41, 91 S. E. 584 (1917) ; Vit- 
 tum V. Estey, 67 Vt. 158, 31 Atl. 144 (1894). , 
 
756 REPUDIATION (Ch. i 
 
 day, within said thirty days, for the .performance of said agreement 
 by the respective parties, and the plaintiff was then ready to perform 
 his part, and the defendants then refused absolutely to perform said 
 agreement on their part, then or at any other time, that would be a 
 breach of the agreement on their part for which the plaintiff can main- 
 tain this action." 
 
 We do not understand this ruling to have been based upon the sup- 
 position of an oral agreement in regard to the time of performance 
 varying the tenns of the written instrument as an executory contract. 
 It would have been clearly erroneous in that aspect ; first, because no 
 such substituted agreement is set forth in the declaration; secondly, 
 because such an oral agreement in regard to land would be within the 
 statute of frauds, and could not be so enforced. 
 
 Subsequent oral agreements in regard to the mode- and time of 
 performance of written contracts relating to land, are doubtless ad- 
 missible to affect the question whether the conduct of either party, as 
 proved, constitutes a breach of his written agreement. In that- aspect, 
 the evidence adduced by the plaintiff in this case was competent, and 
 might have warranted the jury in finding a breach of the contract by 
 the defendants, if they did not revoke their refusal within the thirty 
 days, even without any further offer to perform on the part of the 
 plaintiff. 
 
 The action having been brought immediately upon the refusal, and 
 within the time allowed for performance by the terais of the written 
 contract sued upon, the effect of the ruling was that an absolute refus- 
 al of performance, purporting and intended to be a refusal to fulfil the 
 contract at any time, would be of itself a breach of a contract for acts 
 to be done within a time not yet expired, so that an action would lie 
 forthwith. The proposition involved in this ruling, to wit, that there 
 may be a breach of contract, giving a present right of action, before 
 the performance is due by its terms, seems to have been adopted by re- 
 cent English decisions. Frost v. Knight, L. R. 7 Exi 111 (1872); 
 Hochster v. De la Tour, 2 E. & B. 678 (1853). 
 
 It is said to be applicable, not only in cases where performance has 
 been rendered impossible by the voluntary conduct of the party, as, in 
 agreements for marriage or conveyance of land, by marriage or con- 
 veyance to another, and by way of exception to the general rule for- 
 merly maintained, but to the full extent of a general rule ; so that an 
 absolute and unqualified declaration of a purpose not to fulfil or be 
 held by the contract, made by one party to the other, may be treated 
 as of itself a present breach of the contract by repudiation, as well be- 
 fore as after the time stipulated for its fulfilment by such party. The 
 point was elaborately discussed in Frost v. Knight, by L/ord Chief 
 Justice Cockburn; and the principle evolved is expressed in these 
 propositions, on page 114: 
 
 "The promisee has an inchoate right to the performance of the bar- 
 gain, which becomes complete when the time for performance has 
 
iSec. 4) ANTICIPATOEY REPUDIATION AS A CAUSE OF ACTION 757 
 
 arrived. In the mean time he has a right to have the contract kept 
 open as a subsisting and effective contract. Its unimpaired and un- 
 impeached efficacy may be essential to his interests. His rights ac- 
 quired under it may be dealt with by him in various ways for his ben- 
 efit and advantage." 
 
 "The contract having been thus broken by the promisor and treated 
 as broken by the promisee; performance at the appointed time be- 
 comes excluded, and the breach by reason of the future non-perform- 
 ance becomes virtually involved in the action as one of the conse- 
 quences of the repudiation of the contract; and the eventual non- 
 performance may therefore, by anticipation, be treated as a cause of 
 action, and damages be assessed and recovered in respect of it, though 
 the time for performance may yet be remote." 
 
 The first of these two propositions would apply with peculiar force 
 to commercial paper, especially if its repudiation by the maker were 
 made public. We see no reason for a distinction which should ex- 
 clude it from the same rule that applies to other promises in writing, 
 in respect to what will constitute a breach of the principal contract 
 between the rnaker and payee. We are not aware, however, that any 
 decision has carried out the rule by applying it to such contracts ; and 
 we doubt if the learned jurists who propounded it would have been 
 willing to follow it to that extent. 
 
 The doctrine has never been adopted in this Commonwealth nor has 
 it received any recognition, so far as we are able to learn, beyond that 
 in Heard v. Bowers, 23 Pick. 455, 460. The court in that case, refer 
 to Ford V. Tiley, 6 B. & C. 325, 327, and 5 Vin. Ab. 224; the doctrine 
 announced in Ford v. Tiley being, as it appears to us, an erroneous 
 application of the maxims contained in Viner. 
 
 A renunciation of the agreement, by declarations or inconsistent 
 conduct, before the time of performance, may give cause for treating 
 it as rescinded, and excuse the other party from making ready for 
 performance on his part, or relieve him from the necessity of offering 
 performance in order to enforce his rights. It may destroy all capac- 
 ity of the party, so disavowing its obligations, to assert rights under 
 it afterwards, if the other party has acted upon such disavowal. But 
 we are unable to see how it can, of itself, constitute a present violation 
 of any legal rights of the other party, or confer upon him a present 
 right of action. An executory coritract ordinarily confers no title or 
 interest in the subject matter of the agreement. Until the time ar- 
 rives when, by the terms of the agreement, he is or might be entitled 
 to its performance, he can. suffer no injury or deprivation which can 
 form a ground of damages. There is neither violation of right, nor 
 loss upon which to found an action. The true rule seems to us to be 
 that in order to charge one in damages for breach of an executory 
 personal contract, the other party must show a refusal or neglect to 
 perform, at a time when and under conditions such that he is or might 
 be entitled to require performance. Frazier v. Cushman, 12 Mass. 
 
758 EEPTJDIATION (Ch. 4 
 
 277; Pomroy v. Gold, 2 Mete. 500; Hapgood v. Shaw, 105 Mass. 
 276; Carpenter v. Holcomb, 105 Mass. 280. Such undoubtedly was 
 the interpretation of the common law in all the earlier decisions. 
 Phillpotts V. Evans, 5 M. & W. 475 ; Ripley v. M'Clure, 4 Exch. 
 345 ; Lovelock v. Franklyn, 8 Q. B. 371. 
 
 The case of Ford v. Tiley, 6 B. & C. 325, cited in Heard v. Bowers, 
 was an action on an agreement of the defendant that he would, as 
 soon as he should become possessed of a certain public house, execute 
 a lease thereof to the plaintiff for a term of years from December 21, 
 1825. There was in fact an outstanding lease of the premises to an- 
 other, to expire at midsummer, in 1827. Before that term expired, 
 the defendant joined with the trustees, who held the legal title, in a 
 lease to another party for 23 years. It was held to be a breach of his 
 agreement with the plaintiff, for which an action would lie at once ; 
 because the defendant had given up his right to have the possession, 
 and put it out of his power, so long ,as his own lease for twenty-three 
 years should last. It does not appear that the suit was brought before 
 December 21, 1825; nor that the time when the defendant would be- 
 come possessed, was mentioned in the agreement. It was not the case 
 of an agreement to make a lease at a named future day. The out- 
 standing lease was an extrinsic fact, merely affecting the occurrence of 
 the contingency upon which the performance of the agreement de- 
 pended; it had no other force in the contract. When, therefore, the 
 defendant made a lease to a stranger, he could no longer say that he 
 was prevented from becoming possessed by the outstanding previous 
 lease, because he had put it out of his power to come into possession, 
 if that were surrendered or otherwise terminated. The .plaintiffs' right 
 to have a lease presently was subject only to a .contingency, of which 
 the defendant had no longer the ability to avail himself. The judg- 
 ment acdords with the rule we have indicated. But in giving judg- 
 ment, Bayley, J., citing 1 Rol. Ab. 248, 5 Vin. Ab. 225, 21 Ed. IV, 
 55, and Co. Litt. 221 b, proceeds to say: "Now if the feoffment of a 
 stranger before the day be a breach of a condition to enfeoff J. S. at a 
 given day, the granting of a lease to a stranger, before the day will be 
 a breach of a contract to grant a lease to J. S. at a given day, and a 
 fortiori will it be a breach so long as the lease to such stranger re- 
 mains in force." 
 
 It seems to us, however, that the reasoning from conditions of for- 
 feiture or defeasance to executory contracts is illogical. If one, hav- 
 ing an estate on condition, by his own act in dealing with the estate, 
 puts it out of his power to perform or comply with the condition, he 
 does what is inconsistent with the terms upon which alone he has the 
 estate; and his grantor may reenter, even before the time of stipu- 
 lated performance, not because of a new right acquired by the terms 
 of the agreement, but because the right of the other party having be- 
 come forfeited or extinguished by his breach of the condition, or vio- 
 lation of the terms of his tenancy, the grantor or feoffor is restored to 
 
Sec. 4) ANTICIPATORY REPUDIATION AS A CAUSE OF ACTION 759 
 
 his former estate and right. It is by virtue of that right or title that 
 he enters, the other party being no longer able to avail himself of his 
 conditional estate or right. The analogy holds good if the plaintifif's 
 right to require performance of the agreement awaits only a contin- 
 gency which the defendant removes by making it impossible, which 
 was the real case in Ford v. Tiley. It gives no support to the very 
 different proposition that, in a contract to be performed on a given 
 day, the voluntary disability of one party will entitle the other to re- 
 quire performance, or to have an action for non-performance, "before 
 that day arrives. 
 
 The distinction is recognized by the authorities referred to by Mr. 
 Justice Bayley. Lord Coke says: "And herein a diversity is to be 
 observed between a disability for a time on the part of the feoffee, 
 and a disability for a time of the part of the feoffor." In the one 
 case, albeit "a certain day be limited, yet the feoffee being once disabled 
 is ever disabled." "And the reason of the diversity is, for that, as 
 Littleton saith, maintenant by the disability of the feoffee, the condi- 
 tion is broken, and the feoffor may enter, but so it is not by the dis- 
 ability of the feoffor or his heirs; for if they perform the condition 
 within the time, it is sufficient, for that they may at any time perform 
 the condition before the day." Co. Litt. 221 b; 5 Vin. Ab. 224, Con- 
 dition, B. c. 
 
 We have examined with care the opinions of Lord Chief Justice 
 Cockbum in Frost v. Knight, and of Lord Campbell in Hochster v. 
 De la Tour, and we are not convinced that the conclusions at which 
 they arrive are founded in sound principles of jurisprudence, or sus- 
 tained by the authorities cited in their support. 
 
 Frost V. Knight was an action upon a promise to marry the plain- 
 tiff on the death of the defendant's father. The defendant broke off 
 the engagement by announcing his intention not to fulfill his promise. 
 The action was brought without waiting for the death of the defend- 
 ant's father. The plaintiff having recovered a verdict, judgment was 
 arrested by the Court of Exchequer; but on error it was held in the 
 Exchequer Chamber, that she was entitled to retain the verdict. The 
 Lord Chief Justice cites Lovelock v. Franklyn, 8 Q. B. 371, and Short 
 V. Stone, 8 Q. B. 358, as having "established that where a party bound 
 to the performance of a contract at a future time, puts it out of his 
 own power to fulfil it, an action will at once lie." Neither decision cit- 
 ed establishes that proposition, where a definite time for performance 
 is appointed by the terms of the contract ; but only where the plaintiff 
 was entitled to require performance upon some previous act or request 
 which the conduct of the defendant has dispensed with. 
 
 Short V. Stone was upon a promise to marry the plaintiff "within a 
 reasonable time after request." The defendant married another, and 
 this was alleged as the breach. It was held that request was not nec- 
 essary, and need not be alleged^ It was rendered unavailing, and 
 
760 REPUDIATION (Ch. 4 
 
 therefore unnecessary, by the act of the defendant, which was of itself 
 a breach of the^ contract by rendering performance impossible* No 
 question arose, or could arise, whether' the action was premature, be- 
 cause there was no future time certain for performance. The defend^ 
 ant had made the only limit of time impossible. 
 
 Lovelock y. Franklyn was upon an agreement to assign a lease, at 
 any time, within seven years, upon payment of a sum named. The de- 
 cision is explicitly upon the ground that the option as to the time, with- 
 in the' seven years, was with the plaintiff. "The defendant is to be 
 ready throughout." Coleridge, J., p. 375. Denman, C. J., says: "Here 
 the party puts it out of his power to perform what he has agreed to 
 perform ; that is, to assign at any time at which he may be called upon. 
 This distinction shows that the passage cited from lyord Coke is inap- 
 plicable; that proves no more, on the point now before us, than that 
 if an act is to be performed at a future time specified, the contract is 
 not broken by something which may merely prevent the performance in 
 the mean time. We are introducing no novelty. In all the cases put 
 for the defendants, the party had the means of rehabilitating himself 
 before the time of perf orniance arrived ; here he has incapacitated him- 
 self at the very time when he may be called on and should be ready." 
 Patteson, J., says : "In this particular contract, the defendant has 
 undertaken to keep himself ready for the whole time." So far from 
 being sustained by this case, the proposition, to which it is cited by 
 Lord Chief Justice Cockburn, is most carefully excluded, if not ex- 
 pressly disavowed. 
 
 The proposition, even if established, is not decisive of the case 
 now before us. We have discussed it, however, because it has an im- 
 portant bearing upon the argument, and is essential to the result reach- 
 ed in Frost v. Knight. The Lord Chief Justice, taking it as established 
 by the cases cited, proceeds to the next step. He says, "The case of 
 Hochster. V. De la Tour, upheld in this court in the Danube & Black 
 Sea Co. V. Xenos, [13 C. B. (N. S.) 825,] went further, and established 
 that notice of an intended breach of a contract to be performed in 
 futuro had a like effect." 
 
 Hochster v. De la Tour appears to us to be the only case which sus- 
 tains this position as an adjudication, although that decision has been 
 recognized in several subsequent cases. Avery v. Bowden, 5 E. & B. 
 714, 6 E. & B. 952; Wilkinson v. Verity, L. R. 6 C. P. 206. It was an 
 action upon a contract of hiring to go as courier for the plaintiff from 
 June 1, 1852, at monthly wages. There was notice of renunciation of 
 the employment, and the action brought May 22, 1852, was sustained. 
 Lord Campbell says : "But it cannot be laid down as a universal rule 
 that, where by agreement an act is to be done on a future day, no ac- 
 tion can be brought for a breach of the agreement till the day for doing 
 the act has arrived. - If a man promises to marry a woman on a future 
 day, an,d before that daysmarries.another womanj he is instantly liable 
 
Sec. 4) ANTICIPATORY REPUDIATION AS A CAUSE OF ACTION 761 
 
 to an action for breach of promise of marriage. Short v. Stone, 8 Q. 
 B. 358." The statement we have already made of Short v. Stone, will 
 show how the essential fact in that case is mistaken, and the reason of 
 the decision misapplied. He adds: "If a man contracts to execute a 
 lease on and from a future day for a certain term, and, before that 
 day, executes a lease to another for the same term, he may be imme- 
 diately sued for breaking the contract. Ford v. Tiley, 6 B. & C. 325." 
 We have already shown in what manner Ford v. Tiley fails to sustain 
 the position for which it is cited. 
 
 In Bowdell v. Parsons, 10 East, 359, cited by Lord Campbell, as 
 showing that upon a contract for sale and delivery of goods at a 
 future time, an action "might have been brought before that time as 
 soon as the vendor had sold and delivered to another," the only ques- 
 tion was of the necessity of alleging time and place of request to de- 
 liver; the plaintiff being entitled to delivery on request. 
 
 In Planche v. Colburn, 8 Bing. 14,»also cited, no time was specified. 
 The plaintiff would have been entitled to his compensation upon per- 
 formance of the service he undertook, which was the preparation of an 
 article or work for, the defendant's periodical publication within a rea- 
 sonable time. He had begun the work towards performance on his 
 part. Full performance by him was rendered useless, and practically 
 prevented by the defendant's abandonment of the enterprise. The case 
 in reality establishes nothing more than that the plaintiff was entitled 
 to treat the contract as rescinded, and recover for what he had done up- 
 on a quantum meruit. 
 
 Elderton v. Emmens, 4 C. B. 479, 6 C. B. 160, and 4 H. L. Cas. 624, 
 was upon a contract of employment. The plaintiff had entered upon 
 the service and was dismissed. The case recognizes a right of action, 
 founded upon the defendant's obligation to continue the plaintiff in 
 his service, and a breach of that obligation by wrongfully dismissing 
 him. From the opinions of Martin, B., 4 H. L. Cas. 648, ana of Tal- 
 fourd, J., p. 652, it would appear that the action was not brought until 
 after the term of stipulated s'ervice had expired. But we conceive that 
 it would have afforded no support to the doctrine for which it was 
 cited, if, it had been brought immediately upon the dismissal of the 
 plaintiff ; because that was the time for performance of the defendant's 
 agreement to employ the plaintiff, for breach of which the action was 
 brought. 
 
 The Danube & Black Sea Co. v. Xenos, 13 C. B. (N. S.) 825, by 
 which Hochster v. De la Tour is said to have beeni upheld, was an 
 action upon an agreement by which the plaintiff was to receive and 
 carry freight for the defendant, the shipment to commence.,on August 
 1st, and the action was not brought until after August 1st. The only 
 question was whether a repudiation of the agreement, notified to the 
 plaintiff before August 1st, and not recalled, excused the plaintiff 
 from making an offer to perform on that day, and was sufficient to 
 
702 REPUDIATION (Ch. 4 
 
 show a breach of the agreement. The judgment is in accordance with 
 that in Ripley v. McClure, 4 Exch. 345, and with the plain rule of 
 law that when the plaintiiiE is prevented by the defendant from per- 
 forming the service or doing the act which will entitle him to the 
 fruits of his contract, he is thereby excused from performance on his 
 part, and is entitled to an appropriate remedy by action. Scot v. 
 Mainy, Poph. 109; Goodman v. Pocock, 15 Q. B. 576; Cort v. Amber- 
 gate, &c., Railway Co., 17 Q. B. 126. 
 
 But the question, in what mode and at what time that 'remedy may 
 be sought, must depend upon the provisions of his contract, and the 
 nature of the rights to which it entitles him, and which are affected 
 by the conduct of the other party. Throughout the whole discussion, 
 both in Hochster v. De la Tour and Frost v. Knight, the question 
 as to what conduct of the defendant will relieve the plaintiff from 
 the necessity of showing readiness and an offer to perform at the day, 
 in order to make out a breach by the other, appears to us to be con- 
 founded with that of the plaintiff's cause of action; or rather, the 
 question, in what consists the plaintiff's cause of action, is lost sight 
 of; the court dealing only with the conduct of the defendant in re- 
 pudiating the obligations of his contract. 
 
 Much argument is expended in both cases upon the ground of con- 
 venience and mutual advantage to the parties from the rule sought to 
 be established. But before that argument can properly have weight, 
 the point to be reached must first be shown to be consistent with logi- 
 cal deductions from the strictly legal aspects of the case. The legal 
 remedy must be founded on some present legal right, and must con- 
 form to the nature of that right. Until the plaintiff has either suffered 
 loss or wrong in respect of that which has already vested in him in 
 right, or has been deprived of or prevented from acquiring that which 
 he is entitled to have or demand, he has no ground on which to seek 
 a remedy by way of reparation. The conduct of the defendant is no 
 wrong to the plaintiff until it actually invades some right of his. Ac- 
 tual injury and not anticipated injury is the ground of legal recovery. 
 The plaintiff's rights are invaded by repudiation of the contract only 
 when it produces the effect of non-performance, or prevents him from 
 entering upon or completing performance on his part, at a time when 
 and in the manner in which he is entitled to perform it or to have it 
 performed. 
 
 That this is the natural and ordinary rule seems to be recognized by 
 Lord Campbell, when he declares that "it cannot be laid down as a 
 universal rule," and proceeds to point out exceptions. And Lord 
 Chief Justjfe Cockburn concedes it to be true "that there can be no 
 actual breach of a contract by reason of non-performance, so long 
 as the time for performance has not yet" arrived." L. R. 7 Ex. 114. 
 But preceding "inchoate right" is discovered, and a corresponding ob- 
 ligation implied, qpon which there may be held to be "a breach of the 
 
Sec. 4) ANTICIPATORY REPUDIATION AS A CAUSE OF ACTION 763 
 
 contract when the promisor repudiates it and declares he will no longer 
 be bound by it." 
 
 In Hochster v. De la Tour, Lord Campbell assigns, as one reason for 
 the decision, that in case of employment as courier, and of promise to 
 marry, a relation is established between the parties by the contract, 
 even before the time of performance; "they impliedly promise that in 
 the mean time neither will do anything to the prejudice of the other in- 
 consistent with that relation ;" and "it seems to be a breach of an im- 
 plied contract if either of them renounces the engagement." In Frost 
 V. Knight, the Lord Chief Justice remarks of the promise to marry : 
 "On such a contract being entered into, not only does a right to its 
 completion arise w^th reference to domestic relations and possibly 
 pecuniary advantages, as also to the social status accruing on mar- 
 riage, but a new status, that of hetrothment, at once arises between the 
 parties." "Each becomes bound to the other ; neither can, consistently 
 with such a relation, enter into a similar engagement with another 
 person; each has an implied right to have this relation continued till 
 the contract is finally accomplished by marriage." 
 
 These, however, are considerations which touch the interpretation 
 and effect of the particular kind of contract ; and so far as they tend 
 to sustain the decisions upon the ground of implied obligations aris- 
 ing and requiring observance at once upon entering into the relation by 
 means of such a contract, they also tend to remove the decisions them- 
 selves out of the range of the question we are now discussing. If 
 there be sound reason to deduce from a promise to marry, or to em- 
 ploy in a special capacity, at a future time, present obligations of 
 implied contract, upon which an action may be founded, in which 
 the breach of the entire agreement "by reason of the future nonper- 
 formance" will be "virtually involved," "as one of the consequences of 
 the repudiation of the contract," it surely is not sound reasoningf by 
 means of that process to arrive at the conclusion that all contracts, 
 having a future day for their performance, include like rights and 
 obligations, so as to enable one party to sue at once, as for a breach, 
 whenever the other announces beforehand his purpose of future non- 
 fulfilment. If this is the result, as it appears to be, of the English de- 
 cisions referred to, or of the reasoning in those cases, we cannot ac- 
 cede to it. We have no occasion now to determine what may be the 
 rule, where the contract may fairly be interpreted as establishing be- 
 tween the parties a present relation of mutual obligations, because we 
 are of opinion that no such implied obligations can be engrafted upon 
 the contract in the present case. It simply binds the defendants to 
 receive a deed of real estate and pay or secure the purchase money; 
 and its written provisions, by which alone their obligations are to be 
 ascertained, allow them thirty days at least within which to fulfil their 
 agreement. The plaintiff could require nothing of them until the ex- 
 piration of that time; and no conduct on their part or declaration, 
 
764 REPUDIATION (Ch. 4 
 
 whether of promise or denial, could give him any cause of action in 
 respect of that agreement of sale. This action therefore ^ cannot be 
 maintained. 
 
 Exceptions sustained."' 
 
 JOHNSTONE V. MILLING. 
 
 (In the Court of Appeal, 1886. L. R. 16 Q. B. Div. 460.) 
 
 Appeal from the order of the Queen's Bench Division directing 
 that judgment should be entered for the defendant on the counter- 
 claim for damages to be ascertained by a reference. 
 
 The defendant in the action set up a counterclaim for damages for 
 breach of a covenant contained in a lease by which the plaintiff cove- 
 nanted with the defendant to rebuild the demised premises. The re- 
 ply stated, among other things, that the plaintiff had not received any 
 notice to rebuild from the defendant as required by the terms of the 
 covenant, and also that the lease was surrendered by the defendant 
 before the time at which the obligation to rebuild would have arisen. 
 
 The action was, after issue joined, remitted to the county court for 
 trial. 
 
 The facts with regard to the claim are immaterial to this report.- 
 
 The facts with regard to the counterclaim appeared at the trial to 
 be as follows: In June, 1881, premises, of which the plaintiff was 
 owner subject to certain mortgages, were demised to the defendant 
 by the plaintiff and his mortgagees for the term of twenty-one years 
 from May 12th, 1880, subject to a proviso for sooner determination 
 of the same, the rent being by the terms of the lease made payable to 
 the plaintiff, until the mortgagees gave notice to the lessee in writ- 
 ing to pay it to them, and, upon such notice being given, to the mort- 
 gagees. The lease contained a covenant by the plaintiff that after 
 the expiration of the first four years of the term the plaintiff would, 
 on receipt from the lessee of six calendar months' notice in writing 
 requiring him so to do, forthwith proceed to rebuild the premises with- 
 
 s3 In accord: Porter v. Supreme Council, American Legion of Honor, 183 
 Mass. 326, 67 N. E. 238 (1903) ; Carstens v. McDonald, 38 Neb. 858, 57 N. 
 W. 757 (1894) ; King v. Waterman, 55 Neb. 324, 75 N. W. 830 (1898), semble; 
 Stanford v. McGill, 6 N. D. 536, 72 N. W. 938, 38 L. R. A. 760 (1897), over- 
 ruled: See Hart-Parr Co. v. Finley, 31 N. D. 130, 153 N. W. 137, L. R. A. 
 1915E, 851, Ann. Cas. 1917E, 706 (1915) ; South Gardiner Lumber Co. v. 
 Bradstreet, 97 Me. 165, 53 Atl. 1110 (1902). 
 
 In Roehm v. Horst, 178 U. S. 1, 20 Sup. Ct. 780, 44 L. Ed. 953 (1900), 
 Fuller, C. J., said: "The opinion of Judge Wells in Daniels v. Newton is 
 generally regarded as containing all that could be said in opposition to the 
 decision of Hochster v. De la Tour, and one of the propositions upon which 
 the opinion rests is that the adoption of the rule in the instance of ordinary 
 contracts would necessitate its adoption in the case of commercial paper. 
 But we are unable to assent to that view. In the case of an ordinary money 
 contract, such as a promissory note, or a bond, the consideration has passed ; 
 there are no mutual obligations ; and eases of that sort do not fall within th& 
 reason of the rule." 
 
Sec, 4) ANTICIPATOEY REPUDIATION AS A CAUSE OP ACTION 70^ 
 
 in the period and in the manner specified by the covenant. It was 
 provided that the lessee might at the end of the first four, seven, or 
 fourteen years of tlie lease determine the same by giving to the .person 
 or persons for the time being in the receipt of the rent six calendar 
 months' notice in writing of his intention so to do. 
 
 The defendant gave the requisite notice to determine the lease at 
 the end of the first four years. He stated in evidence at the trial that 
 during his tenancy he spoke to the plaintiff constantly about getting 
 the money to rebuild the premises ; that the plaintiff said he was un- 
 able to do so, but that he expected a loan society whO' had a second 
 mortgage on the premises might advance money ; that the plaintiff's 
 declaration of inability to get the money for rebuilding extended over 
 the last two years and a half of the defendant's tenancy; that he 
 made it constantly in answer to the defendant's direct question, and at 
 other times in conversation both before and after the expiration of 
 the four years; and that it was in consequence of such declaration 
 that he (the defendant) gave notice to determine the lease. The de- 
 fendant further stated that he continued to occupy the premises for 
 about three months after the determination of the lease paying rent to 
 the mortgagees ; that after the lapse of the lease the plaintiff came to 
 him and voluntarily told him that he was utterly unable to find the 
 money, but that he (the defendant) continued the tenancy on the 
 chance of the plaintiff's getting the money. 
 
 The county court judge found that the plaintiff had been unable 
 to find the money to rebuild the premises ; that the plaintiff both be- 
 fore and after the surrender of tlie lease told the defendant that he 
 was unable and would be unable to find the money for rebuilding the 
 premises; that the defendant in consequence of the plaintiff stating 
 that he was and would be unable to find the money for rebuilding the 
 premises surrendered the lease, and that the defendant suffered dam- 
 age by such surrender. The defendant's counsel submitted on those 
 findings that the defendant was entitled to a verdict on the counter- 
 claim. 
 
 The county court judge, however, held the contrary, and found a 
 verdict both on the claim and on the coiftiterclaim for the plaintiff, and 
 entered judgment accordingly. 
 
 A rule nisi for a new trial was obtained by the defendant in the 
 Queen's Bench Division, and the Divisional Court (Huddleston, B., 
 and Cave, J.), upon the argument of the rule, made the order against 
 which the plaintiff appealed. 
 
 Lord EsHER, M. R.^* The question before us arises entirely on the 
 counterclaim. The claim therein set up is for damages for breach of a 
 covenant in a lease whereby the landlord undertook to rebuild the 
 premises upon notice. It is quite clear that there was no breach of the 
 covenant in the ordinary sense of the^ term, because no notice to re- 
 s'* The concurring opinions of Bowen and Cotton, L. J. J., are omitted. 
 
766 REPUDIATION (Ch. 4 
 
 build had been given, and the tenant had exercised the right given him 
 by the lease of putting an end to the term at the expiration of the 
 first four years, and consequently the lease was determined before the 
 time at which the obligation to rebuild under the covenant would have 
 accrued. 
 
 The lease being so put an end to, it is quite clear that the lessee 
 could not sue the lessor for breach of the covenant in not rebuild- 
 ing after the expiration of the four years. That being so, the cause 
 of action is thus shaped on behalf of the defendant. It is alleged 
 that a breach of the contract was committed by the plaintiff before 
 the end of the four years, inasmuch as he had declared that he was 
 unable and would be unable to find the money for rebuilding when the 
 time came. It is insisted that such declaration amounted to a declara- 
 tion of his intention not to perform the contract, and was intended as 
 a repudiation of it, or that, if it was not so intended, the expressions 
 used by the plaintiff were such that the defendant was entitled to 
 treat them as equivalent to a repudiation of the contract; and it is 
 accordingly contended that there was a breach of the contract by an- 
 ticipation before the time for its performance arrived, for which the 
 defendant was entitled to damages, and that the fact that the defend- 
 ant afterward exercised his option of determining the lease is imma- 
 terial, for in so doing the defendant only acted for the benefit of the 
 landlord in order to minimize the damages arising from his repudia- 
 tion of the contract. The evidence shows, and the county court judge 
 has found as a fact, that the lessor did a considerable time before the 
 expiration of the four years, in answer to the questions of the lessee, 
 repeatedly say that he was unable and would be unable to find the 
 mqney for rebuilding, and the judge finds that in consequence the de- 
 fendant surrendered the lease. It appears, however, from the evi- 
 dence that he did not at once throw up the lease and give the premis- 
 es into the hands of the plaintiff, but that he waited till the last six 
 months of the four years and then gave the requisite notice to deter- 
 mine the term in accordance with the provisions of the lease. Upon 
 these findings the county court judge decided that the defendant could 
 not maintain his counterclaim. The case then went to the Divisional 
 Court, which held that, either upon those findings, or on the infer- 
 ences that ought to be drawn from them, the defendant had a right of 
 action on the covenant, and therefore that the county court judge was 
 wrong. 
 
 Now on what principle can it be that the defendant had a right 
 of action on the covenant? As I have said, it cannot be on the 
 ground that there was a breach of the covenant in the ordinary sense 
 of the term, because the defendant never gave any notice to rebuild, 
 and he put an end to the term, so that the time when the covenant was 
 to be performed never arrived. Accordingly the defendant has re- 
 course to the doctrine laid down in several cases cited, the best known 
 of which is perhaps the case of Hochster v. De La Tour. In those 
 
Sec. 4) ANTICIPATOEY REPUDIATION AS A CAUSE OF ACTION 767 
 
 cases the doctrine relied on has been expressed in various terms more 
 or less accurately; but I think that in all of them the effect of the lan- 
 guage used with regard to the doctrine of anticipatory breach of 
 contract is that a renunciation of a contract, or, in other words, a 
 total refusal to perform it by one party before the time for perform- 
 ance arrives, does not, by itself, amount to a breach of contract, but 
 may be so acted upon and adopted by the other party as a rescission 
 of the contract as to give an immediate right of action. When one 
 party assumes to renounce the contract — that is, by anticipation re- 
 fuses to perform it, he thereby, so far as he is concerned, declares his 
 intention then and there to rescind the contract. Such a renunciation 
 does not of course amount to a rescission of the contract, because one 
 party to a contract cannot by himself rescind it, but by wrongfully 
 making such a renunciation of the contract he entitles the other party, 
 if he pleases, to agree to the contract being put an end to, subject to 
 the retention by him of his right to bring an action in respect of such 
 v/rongf ul rescission. The other party may adopt such renunciation 
 of the contract by so acting upon it as in effect to declare that he too 
 treats the contract as at an end, except for the purpose of bringing 
 an action upon it for the damages sustained by him in consequence 
 of such renunciation. He cannot, however, himself proceed with the 
 contract on the footing that it still exists for other purposes, and also 
 treat such renunciation as an immediate breach. If he adopts the 
 renunciation, the contract is at an end except for the purposes of the 
 action for such wrongful renunciation ; if he does not wish to do so, he 
 must wait for the arrival of the time when in the ordinary course a 
 cause of action on the contract would arise. He must elect which 
 course he will pursue.^'' Such appears to me to be the only doctrine 
 recognized by the law with regard to anticipatory breach of contract. 
 We are asked, as it seems to me, by the counsel for the defendant to 
 lay down a new principle, but I do not think we can do so consistently 
 with the established doctrines of law on the subject. We have tliere- 
 fore to consider whether the defendant can bring his case within the 
 doctrine as to anticipatory breach of contract as already laid down. 
 The first question is whether the plaintiff intended to repudiate the 
 contract when he made the statements relied upon with regard to his 
 inability to find the money for rebuilding. Did he mean to say that, 
 whatever happened, whether he came into money or not, his intention 
 was not to rebuild the premises? It does not seem to me that what 
 he said naturally leads to the inference that such was his intention, 
 
 5 5 In accord: Zuck v. McClure, 98 Pa. 541 (1881) ; Traver v. Halsted, 2,3 
 Wend. (N. Y.) 66 (1840) ; Nilson v. Morse, 52 Wis. 240, 9 N. W. 1 (1881). 
 But where there Is a definite repudiation and no retraction thereof, the 
 other party does not lose his privilege of not performing or his right to dam- 
 ages for an entire breach, merely by continuing to urge performance for 
 thirty days. United Press Ass'n v. National Newspaper Ass'n, 237 Fed. 547, 
 150 O. C. A. 429 (1916). See also Hadfleld v. Colter, 103 Misc. Rep. 474, 170 
 N. Y. Supp. 643 (1918), a valuable case for analysis. 
 
768 REPUDIATION , (Ch,4 
 
 and I think, having regard to the terms of his finding, that the county 
 court judge declined to draw that inference. If he declined to do so, 
 I think we ought not to do so, unless it is a necessary inference from 
 what the plaintiif said. It does not appear to me that it is. If we 
 ought not to draw that inference from what the plaintiff said, it seems 
 to me to folloiw as a matter of course that the defendant was not en- 
 titled to draw it ; and the result is that the defendant fails in the' very 
 first point which it is necessary for him to establish — viz., that the 
 plaint-iff at the time when he made these declarations of his inability 
 to find the money for rebuilding intended to repudiate his liability 
 on the contract, or that he. made use of expressions entitling the de- 
 fendant to suppose that he did so. That being so, his case is gone. 
 
 But, assuming the contrary, then comes the question whether the de- 
 fendant elected to treat the plaintiff's statement as a wrongful repudia- 
 tion of the contract. That involves, first of all, the question whether 
 he could so treat it. The contract made between the plaintiff and the 
 defendant was the whole lease. The covenant in question is a par^ 
 ticular covenant in the lease not going to, the whole consideration. If 
 there were an actual breach of such a covenant at the time fixed for 
 performance, such breach would not, according to the authorities, en- 
 title the tenant to throw up his lease. That being so, I do not hesitate 
 to say, thotigh it is not necessary in this case to decide the point, that 
 an anticipatory breach could not entitle him to do so, and that it does 
 not appear to me that he could elect to rescind part of the contract. 
 
 Therefore it seems to me that the defendant could not elect to put an 
 end to the contract in consequence of what the plaintiff stated. But 
 whether he could do so or not, it seems to me that in fact he did not. 
 He did not renounce the lease or give up the premises. He did not do 
 any act which affected the existence of the contract. He made no 
 declaration of intention to treat it as rescinded except for the purpose 
 of bringing his action upon it. On the contrary, at the time fixed by 
 the contract he gave the requisite notice to determine the lease. 
 
 I think, therefore, that on every point necessary to establish his coun- 
 terclaim the defendant fails. For these reasons, with great deference to 
 the Divisional Court, before whom these points do not appear to have 
 been developed so clearly as they have been before us, I think their de- 
 cision cannot be supported, and that the judgment of the county court 
 judge was correct. 
 
 KELLY V. SECURITY MUT. LIFE INS. CO. 
 
 (Court of Appeals of New York, 1906. 186 N. X. 16, 78 N. E. 584, 9 Ann. 
 
 Cas. 661.) 
 
 Action by William Kelly against the Security Mutual Life Insurance 
 Company. From a judgment in favor of plaintiff, affirmed by the 
 Appellate Division (106 App. Div. 352i 94 N. Y. Supp. 601), defendant 
 appeals. Reversed, and new trial granted. 
 
Sec. 4) ANTICIPATOET REPUDIATION AS A CAUSE OP ACTION 769 
 
 The complaint contains two counts, in the first of which the plain- 
 tiff alleged, in substance, that in August, 1889, the defendant, a do- 
 mestic corporation duly authorized, issued to him its policy of in- 
 surance for $1,000, payable on his death to his wife, the policy being 
 referred to as part of the complaint; that the plaintiff performed his 
 part of thp contract, but the defendant wrongfully declared said policy 
 forfeited, and refused to continue it in force ; that the beneficiary trans- 
 ferred her rights thereunder to him and that the policy was worth to 
 him $1,000, in which amount he alleged he had sustained damages. 
 The second count was. upon a like policy payable to the children of 
 the plaintiff, who transferred their rights to him before the commence- 
 ment of the action. Judgment was demanded for the sum of $2,000, 
 with costs. Each policy was a certificate of the defendant admitting 
 the plaintiff to membership, subject to certain specified conditions, in- 
 cluding the prompt payment of quarterly dues on the days named. 
 Upon his death his wife in one case and his children in the other, be- 
 came entitled to payment from the reserve fund of the sum of $1,000. 
 The failure to pay dues rendered the contract void and forfeited all 
 payments made thereon, with an unimportant exception. The answer 
 alleged as an affirmative defense that the policies became null and void 
 on the 2d of May, 1903, because the plaintiff failed to' pay the pre- 
 miums which fell due on that day as required by the contracts. The 
 question sent to the jury was whether the defendant by its course of 
 dealing with the plaintiff had waived strict performance as to the pay- 
 ment of dues on the law day. They were instructed if they found a 
 waiver to bring in a verdict in favor of the plaintiff for the present 
 value of the policies, including interest. The jury found a general ver- 
 dict for the plaintiff for $1,289.78. The judgment entered thereon was 
 unanimously affirmed by the Appellate Division, and the defendant 
 appealed to this court. 
 
 Vann, J. (after stating the facts). Before any evidence was taken 
 at the trial the defendant moved to' dismiss the complaint upon the 
 ground that it did not state facts sufficient to constitute a cause of 
 action, but the motion was denied and the defendant excepted. This 
 ruling survives unanimous affirmance by the Appellate Division, and is 
 open to review by this court. Jones v. Reilly, 174 N. Y. 104, 66 N. E. 
 649; Sanders v. Saxton, 182 N. Y. 477, 478, 75 N. E. 529, 1 L. R. A. 
 (N. S.) 727, 108 Am. St. Rep. 826. The defendant was not required 
 to present the question by demurrer or answer, but could raise it by 
 motion made at the trial. Weeks v. O'Brien, 141 N. Y. 199, 203, 36 
 N. E. 185 ; Code Civ. Proc. § 499. 
 
 The case made by the complaint was not in equity to relieve from 
 forfeiture and reinstate the policy, but purely at law to recover dam- 
 ages for the breach of its contract by the defendant. The only promise 
 made by the defendant in the contract was to pay a sum of money on 
 the death of the plaintiff, but no breach of that promise was alleged. 
 
 COKBIN CONT. — 49 
 
770 REPUDIATION (Ch. 4 
 
 The plaintiff is still living, and nothing is yet due upon the contract, 
 according to its ternis. What breach was alleged? The only allega- 
 tion on that subject is that the defendant wrongfully declared the con- 
 tract "void and forfeited," denied that the plaintiff had "any rights 
 thereunder," and refused "to continue said policy in force." How or 
 why, when, to whom or by whom the defendant declared the con- 
 tract forfeited, or denied the plaintiff's rights thereunder, or refused 
 to continue it in force, is not stated. There is no allegation of a re- 
 fusal to receive premiums, or give receipts therefor, or that the de- 
 fendant had never recognized its contract, or that it had not retracted 
 its repudiation, or that it was in such a position that it could not re- 
 tract. The pleader was satisfied with the conclusion that he set forth. 
 This was not a breach of the contract, because the time for performance 
 by the defendant had not arrived. An attempt to repudiate such a con- 
 tract does not make it due. If the maker of a promissory note, given 
 for borrowed money and due one year after date, notifies the holder 
 the next day that he repudiates it and will not pay it, can the holder 
 sue at once ? Can a mortgagor make his mortgage due before the law 
 day by repudiating it in advance ? 
 
 The rule that renunciation of a continuous executory contract by one 
 party before the day of performance gives the other party the right 
 to sue at once for damages, is usually applied only to contracts of a 
 sp>ecial character, even in the jurisdictions where it obtains at all. 1\ 
 is not generally applied to contracts for the payment of nioney at a 
 future time and in some states the principle is not recognized in any 
 way whatever. Daniels v. Newton, 114 Mass. 530, 19 Am. Rep. 384; 
 Stanford v. McGillJ 6 N. D. 536, 72 N. W. 938, 38 L. R. A. 760; 
 Carstens v. McDonald, 38 Neb. 858, 57 N. W. 757; King v. Water- 
 man, 55 Neb. 324, 75 N. W. 830. In other states and in the Federal 
 courts the principle is adopted but applied with caution. Roehm v. 
 Horst, 178 U. S. 1, 17, 18, 20 Sup. Ct. 780, 44 L. Ed. 953 ; Schmidt 
 V. Schnell, 7 O. C. D. 657; Brown v. Odill, 104 Tenn. 250, 56 S. W. 
 840, 52 Iv. R. A. 660, 78 Am. St. Rep. 914; Roebling's Sons v. Fence 
 Co., 130 111. 660, 22 N. E. 518; Unexcelled Fire Works Co. v. Polites, 
 130 Pa. 536, 18 Atl. 1058, 17 Am. St. Rep. 788. In this state it seems 
 to be limited to contracts to marry (Burtis v. Thompson, 42 N. Y. 246, 
 1 Am. Rep. 516); for personal services (Howard v. Daly, 61 N. Y. 
 362, 19 Am. Rep. 285); and for the manufacture or sale of goods 
 (Windmuller v. Pope, 107 N. Y. 674, 14 N. E. 436; Nichols v. Scranton 
 Steel Co., 137 N. Y. 471, 33 N. E. 561). At least we have not extend- 
 ed it to mutual life insurance policies, perhaps for the reason that the 
 question of fact opened to unscrupulous persons by such extension • 
 might undermine the solvency of the company and inflict gross in- 
 justice upon the other policy holders. 
 
 The plaintiff alleges a breach oiily by anticipation. We held di- 
 rectly against his contention in a recent case which we regard as con- 
 
Sec. 4) ANTICIPATORY REPUDIATION AS A CAUSE OF ACTION 771 
 
 trolling. Uangan V. Supreme Council Am. L. of H., 174 N. Y. 266, 
 66 N. E. 932. That was an action at law founded upon a certificate 
 of insurance, whereby the defendant promised, upon the death of the 
 plaintififj to pay his wife a sum not exceeding $5,000. The plaintiff 
 alleged performance until the "defendant by its wrongful act broke 
 the said contract, and declared the same void." Hd further alleged 
 that the defendant had "failed to carry out the conditions of the con- 
 tract by declaring that it will not perform the contract or pay the in- 
 surance agreed to b^ paid, and that, upon his death, the beneficiary will 
 not then be entitled" to the sum specified, "and that by reason of the 
 breach of the aforesaid contract by defendant, plaintiff has sustained 
 damages in the sum of $5,000." A judgment for $1,505.96, "the pres- 
 ent value of the policy," was affirmed by the Appellate Division, but 
 reversed by this court, upon the ground that "there was no breach of 
 contract * * * which justified an action for damages; that the 
 action of the plaintiff" in tendering performance "preserved the con- 
 tract of insurance as it was; that he was not, thereupon, compelled to 
 a course of inaction, but might resort to a court of equity, * * * 
 and compel the defendant to live up to its contract." 
 
 The principle of that case controls this. Both actions were at law to 
 recover damages for the breach of the same kind of a contract land in 
 the same way. As we held that an action at law would not lie in that 
 case because there was no breach, and that the remedy of the plain- 
 tiff was in equity, we are compelled to hold the same way in this case. 
 "The plaintiff, had no right to sue for damages before the time for per- 
 formance by the defendant had arrived. He had sustained no dam- 
 ages, for the policy was still in force, and if it refused to recognize its 
 obligation thereunder he could compel recognition by a judgment exact- 
 ly adapted to the situation. ' 
 
 The judgment below should be reversed, and a new trial granted, 
 with costs to abide event. °° 
 
 O'NEILL v. SUPREME COUNCIL AMERICAN LEGION OF 
 
 HONOR. 
 
 (Supreme Court of New Jersey, 1904. 70 N. J. Law, 410, 57 Atl. 463, 1 Ann. 
 
 Cas. 422.) 
 
 Action by Thomas O'Neill against the Supreme Council American 
 Legion of Honor. Demurrer to pleas overruled. 
 
 Pitney, J." The declaration avers that in the year 1891 the defend- 
 ant was a corporation of ' the state of Massachusetts, engaged in 
 business in the state of New Jersey, and made a contract under seal 
 with the plaintiff, known as a benefit certificate (set forth in full in the 
 pleading), whereby it was certified that the plaintiff was a companion 
 
 56 Dissenting opinion of Edward T. Bartlett, J., is omitted. 
 'i' Parts of tlie opinion are omitted. 
 
772 REPUDIATION , (Ch. 4 
 
 of the American L,egIon of Honor, and thereupon, in consideration of 
 full compliance by him with all by-laws of the supreme council of that 
 order, then existing or thereafter adopted, and the conditions in the 
 benefit certificate contained, the supreme council agreed to pay to the 
 plaintiff's sister, in trust for his six children, the sum of $5,000, upon 
 satisfactory proof of the plaintiff's death while in good standing upon 
 the books of the supreme council. It alleges that the contract was 
 made in consideration of the payment by the plaintiff of the assess- 
 ments or premiums which might from time to time be called by the 
 defendant. It avers payment by the plaintiff of all assessments call- 
 ed, and performance by him of all conditions, until the defendant 
 broke the contract and declared the same void. It sets up that the 
 defendant has failed, neglected, and refused to carry out the condi- 
 tions of the contract, in that on August 22, 1900, on December 10, 
 1901, and on divers other days between those dates, the defendant de- 
 clared to the plaintiff that it would not perform the contract or pay the 
 insurance money thereby agreed to be paid, and that upon the plain- 
 tiff's death the beneficiaries would not be entitled to receive the sum 
 of $5,000, and that the defendant would not pay the same, but that 
 the beneficiaries should receive only $2,000. The declaration further 
 avers that up»on the breach of the contract by the defendant as afore- 
 said, and upon the several dates mentioned above, the plaintiff tender- 
 ed to the defendant the same monthly assessments and payments as 
 had been theretofore called or required by the defendant upon the 
 the contract, and the plaintiff offered and agreed to continue making 
 such payments, and in all respects offered, to comply with the terms 
 and conditions of the contract; yet the defendant refused to accept 
 from the plaintiff the assessments so tendered, and refused to recog- 
 nize the contract or continue it in force; whereby the plaintiff has sus- 
 tained damages, to recover which the action is brought. 
 
 The defendant has pleaded the general issue and five special pleas. 
 To each of the latter the plaintiff demurs. The first question for con- 
 sideration is whether the declaration sets forth a good cause of action. 
 The cause of action asserted is not the right to recover the sum nam- 
 ed in the benefit certificate according to its terms, but to recover dam- 
 ages for a renunciation of the agreement, by the party bound, in ad- 
 vance of the time set for performance. Numerous reported decisions 
 have laid down the doctrine that where a contract embodies mutual 
 and interdependent conditions and obligations, and one party either 
 disables himself from performing, or prevents the other from per- 
 forming, or repudiates in advance his obligations under the contract, 
 and refuses to be longer bound thereby, commimicating such repudi- 
 ation to the other party, the latter party is not only excused from fur- 
 ther performance on his part, but may at his option treat the contract 
 as terminated for all purposes of performance, and maintain an action 
 at once for damages occasioned by such repudiation, without await- 
 ing the time fixed by the contract for performance by the defendant. 
 
 I 
 
Sec. 4) ANTICIPATORY REPUDIATION AS A CAUSE OF ACTION 773 
 
 This doctrine has been followed in the English courts for more than 
 half a century. °« * * * 
 
 In the leading case of Hochster v. De La Tour, Crompton, J., said, 
 during the argument : "When a party announces his intention not to 
 fulfill the contract, the other side may take him at his word and re- 
 scind the contract. That word 'rescind'^ implies that both parties have 
 agreed that the contract shall be at an end as if it had never been. 
 But I am inclined to think that the party may also say : 'Since you 
 have announced that you will not go on with the contract, I will con- 
 sent that it shall be at an end from this time (meaning, of course, for 
 purposes of further performance) ; but I will hold you liable for the 
 damage I have sustained, and I will proceed to make that damage as 
 little as possible by making the best use I can of my liberty.' This is 
 the principle of those cases in which there has been a discussion as to 
 the measure of damages to which a servant is entitled on a wrongful 
 dismissal." And Lord Campbell, C. J., in delivering judgment, said : 
 "It seems strange that the defendant, after renouncing the contract 
 and absolutely declaring that he will never act under it, should be per- 
 mitted to object that faith is given to his assertion, and that an op- 
 portunity is not left to him of changing his mind. * * * The man 
 who wrongfully renounces a contract into which he has deliberately 
 entered cannot justly complain if he is immediately sued for a com- 
 pensation in damages by the man whom he has injured; and it seems 
 reasonable to allow an option to the injure:d party either to sue imme- 
 diately or to wait till the time when the act was to be done, still hold- 
 ing it as prospectively binding for the exercise of this option, which 
 may be advantageous to the innocent party, and cannot be prejudicial 
 to the wrongdoer." 
 
 The same rule prevails in the Supreme Court of the United 'States. 
 Roehm v. Horst (1899) 178 U. S. 1, 20 Sup. Ct. 780, 44 L. Ed. 953, 
 where numerous previous decisions of the same cotirt are cited. And 
 the great weight of authority in the state courts is to the same ef- 
 
 =8 The court here cited Hochster v. De La Tour, 2 El. & Bl. 678, 22 L. J. 
 Q. B. 455 (1853) ; Cort v. Ambergate, etc., Ky. Co., 17 Ad. & El. (N. S.) Q. 
 B. 127 (1851) ; Avery v. Bowden, 5 El. & Bl. 714, 6 El. & Bl. 953 (1855) ; 
 Danube, etc., By. Go. v. Xenos, 11 Com. Bench (N. S.) 152 (1861), affirmed 
 on appeal in Exchequer Chamber, 13 Com. Bench (N. S.) 825; Frost v. 
 Knight, L. E. 7 Exch. Ill (1872) ; Johnstone v. Milling, L. R. 16 Q. B. Div. 
 460 (1886) ; Synge v. Synge, 1 Q. B. 466 (1894). 
 
 5 8 The court cited Burtis v. Thompson, 42 N. Y. 246, 1 Am. Rep. 516 (1870) ; 
 Howard v. Daly, 61 N. Y. 362, 374, 19 Am. Rep. 285 (1875) ; Ferris v. Spooner, 
 102 N. Y. 10, 5 N. E. 773 (1886) ; WindmuUer v. Pope, 107 N. Y. 674, 14 N. 
 E. 436 (1887) ; Nichols v. Seranton Steel Co., 137 N. Y. 471, 487, 83 N. E. 561 
 
 (1893) ; Kadlsh v. Young, 108 111. 170, 177, 43 Am. Rep. 548 (1883) ; Roebling's 
 Sons Co. V. Lock Stitch Fence Co., 130 111. 660, 22 N. E. 518 (1889) ; Lake 
 Shore & M. S. Ry. Co. v. Richards, 152 111. 59, 38 N. E. 773, 30 L. R. A. 33 
 
 (1894) ; Kui-tz V. Frank, 76 Ind. 594, 40 Am. Rep. 275 (1881) ; Crabtree v. Mes- 
 sersmith, 19 Iowa, 179 (1865) ; McCormick v. Basal, 46 Iowa, 235 (1877) ; Hos- 
 -mer v. AVilson, 7 Mich. 294, 304, 74 Am. Dec. 716 (1859) ; Piatt v. Brand, 26 Mich. 
 
774 REPUDIATION (Ch. 4 
 
 So far as observed, the only states dissenting from the doctrine are 
 Massachusetts, Nebraska, and North Dakota. Daniels v. Newton,' 114 
 Mass. 530, 19 Am. Rep. 384; Carstens v. McDonald, 38 Neb. 858, 57 
 N. W. 757; King v. Watermaji, 55 Neb. 324, 75 N. W. 830; Stanford 
 V. McGill," 6 N. D. 536, 72 N. W. 938, 38 L. R. A. 760. The latter 
 decision is based partly, and the Nebraska decisions principally, upon 
 the aujthority of Daniels v. Newton, which is the leading case upon 
 this side of the question. It is there held that a mere refusal of 
 performance by the promisor, before the time for performance, ar- 
 rives, cannot form a ground of damages. But in Parker v. Russell, 
 133 Mass. 74, it was held a refusal of .performance of a substantial 
 part of the contract, after the time for entering upon performance 
 has.ibegiin, entitles the injured party to treat the entire contract as 
 absolutely broken, and to recover immediately his damages, based up- 
 on the whole value of the contract, including compensation for non- 
 performance in the future as well as in the past. In Ballou v, Billings, 
 136 Mass. 307, it was held that, for purposes of rescission by the 
 promisee, notice that the promisor will not perform has the same ef- 
 fect as an actual breach. These and other cases show that, even in 
 , Massachusetts, the reasoning on which the decision in Daniels v. New- 
 ton was based is hardly carried to its logical conclusion, jewett v. 
 Brooks, 134 Mass. 505 ; Lowe v. Harwood, 139 Mass. 133, 29 N. E. 
 538; Paige v. Barrett, 151 Mass. 67, 23 N. E. 725; Whittenv. New 
 England, etc., Co., 165 Mass. 343, 43 N- E. 121. Upon the precise 
 point now presented, however, the authority of Daniels, v. Newton is 
 still recognized in Massachusetts, as appears from a recent decision 
 in a case that is "on all fours", with the one now before us. Porter v. 
 American Legion of Honor (1903) 183 Mass. 326, 67 N. E. 238. • 
 
 The general question of repudiation of contracts is ably discussed 
 by Prof. Wilhston in 14 Harv. Law Rev. 317, 421, with an ample ci- 
 tation of cases. He combats the doctrine of Hochster v. De La Tour, 
 while conceding that it is sustained by the great weight of author- 
 ity. * * * 
 
 173 (1872) ; Hocking v. Hamilton, 158 Pa. 107, 27 Atl. 836 (1893) ; Davis v. 
 Grand Rapids School Furniture Co., 41 W. Va. 717, 24 S. E. 680 (1896) ; Remy v. 
 Olds, 88 Cal. 587, 26 Pac. 355 (1891) ; Sullivan v. McMillan, 26 Fla. 543, 557, 8 
 South. 450 (1890) ; Thompson v. Kyle, 39 Ma. 582, 599, 23 South', n, 63 Am. St. 
 Rep. 193 (1897) ; Fox v. Kitton, 19 111. 519, 534 (1858) ; Follansbee v. Adams, 
 86 111. 13 (1877) ; Adams v. Byerly, 123 Ind. 368, 24 N. E. 130 (1890) ; KalkhofE 
 v. Nelson, 60 Minn. 284, 62 N. W. 382 (1895) ; Bignall & Keeler Mfg. Co. v. 
 Pierce, Butler & Pierce Mfg. Co., 59 Mo. App. 673, 682 (1894) ; Claes & Leheu- 
 bouter Mfg. Co. v. McCord, 65 Mo. App. 507 (1896) ; Burke v. Shaver, 92 Va. 
 345, 23 S. E. 749 (1895) ; Lee v. Mutual Reserve Fund Life Ass'n, 97 Va. 160, 
 33 S. E. 556 (18^). 
 
 The doctrine of Hochster v. De La Tour is generally recognized by the 
 text-writers as established law. 7 Am. & Eng. Bncycl. Law (2d Ed.) title 
 "Contracts," p. 150; Bi-ih. Cont. § 1428; 2 Chitt. Cont. (11th Am. Ed.) 1067. 
 1079; 2. Pars. Cop^.. (8th Ed.) 781 (*667) ; Todd v. Gamble, 148 N. T. 382, 
 42 N. E. 982, 52 L. R. A. 248 (1896) ; Benj. Sales (Corb. Ed.) §§ 859, 860. 
 
 '"Now overruled: Hart-Parr Co. v. Finley, 31 N. D. 130, 153 N. W. 137, 
 L.iR. A. 1915B,-851, Ann. Cas. 1917E, 706 (1915). 
 
Sec. 4) ANTICIPATORY EEPUDIATION AS A CAUSE OF ACTION 775 
 
 Upon the whole, we are satisfied that the doctrine of Hochster v. 
 De L,a Tour is well founded in principle as well as supported by au- 
 thority. We are also clear that it. applies to such a contract as the one 
 . in suit, and that the declaration sets forth a renunciation so clear 5ind 
 unequivocal as to give ground for an action, it being averred that the 
 defendant has declared to the plaintiff that it will not perform the 
 contract, and has refused to accept the monthly assessments tendered 
 by the plaintiff in performance of conditions precedent on his part. 
 
 But it is further objected that the plaintiff has no interest in the 
 benefit certificate of such a character as to entitle him to maintain an 
 action for damages by reason &f its renunciation. It is urged that 
 under such a certificate the member acquires no property in the bene- 
 fit, but only a power to designate the beneficiary.^^ * * * 
 
 Two recent decisions are cited to us as authority for the contention 
 that such an action as the present cannot be maintained against a bene- 
 fit society by one of its members. The}- are Langan v. Supreme Coun- 
 cil, 174 N. Y. 266, 66 N. E, 932, and Porter v. American Legion of 
 Honor, 183 Mass. 326, 67 N. E. 238. The latter case follows Daniels 
 y. Newton in treating the renunciation of a contract, before arrival of 
 the time for performance, as inefficacious, and therefore as conferring 
 no present right of action. In the Langan Case the New York Court 
 of Appeals, without overruling or even questioning the authority of 
 the former decisions of the same court (already cited) that sustain the 
 doctrine of Hochster v. De La Toiir, nevertheless refused to entertain 
 an action at law brought by a member against a benefit society to re- 
 cover damages for the repudiation of a benefit certificate. The denial 
 of the legal remedy was placed : First, upon the ground that the de- 
 fendant could not, by repudiation, terminate its liability under the 
 benefit certificate ; the answer to which is that, under the doctrine re- 
 ferred to, such repudiation does give rise to a present liability, at the 
 option of the party injured. But, secondly, the decision was based on 
 the ground that the plaintiff could, by an equitable action, require the 
 defendant to recognize the contract as in force. It is needless to say 
 that under our system of jurisprudence the latter ground is untenable. 
 We frequently deny equitable relief where an adequate remedy exists 
 at law, but where a suitor has a legal cause of action we do not turn 
 him out of the courts of law on the ground that he may be able to ob- 
 tain adequate relief in equity. * * * 
 
 Judgment for the plaintiff. 
 
 «i The court held as to this that the power and privilege of appointing the 
 beneficiary are accompanied by a legal right against the insurer that such 
 beneficiary shall be paid and that the insured has a "pecuniary interest." 
 "In this aspect the contract has to a member a value of the same character 
 as any other investment made for the ultimate benefit of his children." 
 
776 EBPUDIATION (Ch. 4 
 
 WEISER V. ROWE. 
 (Supreme Court of Iowa, 1919. 185 Iowa, 501, ITO N. W. 753.) 
 
 Action at law to recover back $500 purchase money paid upon a land ' 
 contract which the plaintiff rescinded on account of alleged breach by 
 the defendant. There was a verdict for the plaintiff, and the defendant 
 appeals. AfRi-med. 
 
 Evans, J. On January 4, 1918, the plaintiff and defendant entered 
 into a written contract, whereby the defendant purported to sell, and 
 the plaintiff to buy, 160 acres of land for the consideration of $12,800. 
 Five hundred dollars was paid on the contract. For the remainder of 
 the purchase price $6,500 in mortgages were to be assumed, and the bal- 
 ance of $5,800 was to be paid at the time of delivery of deed. The de- 
 fendant was to furnish an abstract showing good and merchantable title 
 and to deliver a warranty deed, all to be done within 30 days. On Jan- 
 uary 13th the defendant caused the plaintiff to be furnished with an 
 abstract of title, which was examined by plaintiff's attorney. Some for- 
 mal defects in the chain of title were pointed out by the examining at- 
 torney. The defendant proceeded to amend such defects and acquired 
 the necessary instruments for the purpose by the morning of February 
 5th. The time limit specified in the contract expired on February 3d. 
 No place of performance was specified in the contract. The parties 
 did not meet on February 3d or 4th, nor does it appear that any at- 
 tempt to meet was made by either. On the morning of February 5th, 
 the defendant phoned to the plaintiff that he had acquired all necessary 
 papers and was then able and ready to close the deal. In response to 
 the notification, the plaintiff stated that he had withdrawn from the 
 contract because of the failure of the defendant to comply therewith 
 within the time limit. 
 
 The question has been considerably discussed in the briefs whether 
 the plaintiff had the right to rescind the contract on the mere ground 
 that the defendant had failed to tender performance within the time 
 limit. In view of the fact already noted that the plaintiff himself did 
 not offer performance at any time prior to February Sth, the contract 
 was thereby continued in force. Either party could put the other in 
 default by a tender and demand. Waters v. Pearson, 163 Iowa, 391, 
 144 N. W. 1026; Wright v. Swigart, 172 Iowa, 743, 154 N. W. 938; 
 Miller V. McConnell, 179 Iowa, 2,77, 157 N. W. 943. 
 
 On February Sth the defendant served upon the plaintiff a written 
 offer and demand of performance and a notice of intention to declare 
 a forfeiture. It appears, however, that though the defendant said on 
 February 5th that he was ready and able, and though he repeated in 
 writing th^ same offer on February Sth, he was not in fact ready or 
 able to perform on either date. The ,title to the land was not in the 
 defendant. It was in the Levitt Investment Company. The defendant 
 had a contract for the purchase with the Levitt Investment Company. 
 
Sec. 4) ANTICIPATORY REPUDIATION AS A CAUSE OF ACTION 777 
 
 The terms of that contract do not appear in the record. According to 
 the defendant's testimony as a witness he did not receive his title until 
 February 10th. His deed was not filed until March 2d. It could not 
 therefore have appeared upon his abstract of title before that date. To 
 add to the complication, the deed delivered to the defendant conveyed 
 to him only an undivided one-half of the property and conveyed the 
 other undivided one-half to one Warren Sellers. Sellers, was not a 
 party to the contract, nor is his apparent connection with the title ac- 
 quired from the Levitt Investment Company explained in the evidence 
 in any manner. The result is that the tender and demand by the de- 
 fendant were premature in the sense that at the time of such tender he 
 was not ready and able to perform it, and was therefore not entitled 
 to make a demand upon plain^ff . It goes without saying that the plain- 
 tiff was justified in refusing the demand. Under the circumstances 
 here indicated, he was not bound to make a tender to the defendant. 
 Nelson v. Chingren, 132 Iowa, 383, 106 N. W. 936. The defendant's 
 false offer and premature demand amounted to a breach on his part, 
 and the plaintiff thereby became entitled to rescind. 
 
 Such was the holding of the trial court, and its judgment is 
 affirmed."^ 
 
 GA NUN V. PALMER. 
 
 (Court of Appeals of New York, 1911. 202 N. Y. 483, 96 N. E. 99, 36 L. B. 
 
 A. [N. S.] 922.) 
 
 Action by Mary F. Ga Nun, on behalf of herself and all other cred- 
 itors of Jane M. Sands, deceased, against Mary E. Palmer, individually 
 and as executrix of Jane M. Sands, deceased. From a judgment of 
 the Appellate Division (139 App. Div. 910, 123 N. Y. Supp. 1117) 
 affirming a judgment dismissing the complaint on the merits, plaintiff 
 by permission appeals. Reversed, and new trial granted. 
 
 Haight, J.*"* This action was brought to recover the sum of $20,- 
 000, alleged to be due and owing the plaintiff from the defendant's 
 testatrix, and also to set aside certain transfers of property by the tes- 
 tatrix in her lifetime, alleged to have been made in fraud of the 
 rights of creditors. The answer admits the making of a will by the 
 defendant's testatrix and its admission to probate, and denies the other 
 allegations of the complaint, and then alleges that if any cause of ac- 
 tion existed it is barred by the statute of limitations. 
 
 The contract upon which the plaintiff seeks to recover is as follows : 
 "Nov. 23, 1899—1, Mary F. Ga Nun, do promise to care for Jane M. 
 
 *2A tender of performance that Is not as required by the contract does 
 not operate as a repudiation or breach, If the time agreed upon for perform- 
 ance has not expired; A later tender may be good^ Borrowman v. Free, 4 
 Q. B. D. 500 (1878).^ _ ' 
 
 «2 Parts of the opinion are omitted. 
 
778 EBPUDIATION (Ch. 4 
 
 Sands in sickness and health as long as she lives. I, Jane M. Sands, do 
 promise to pay Mary F. Ga Nun $70.00 a month for the support of the 
 house and her clothes as long as I live, and at my death she is to have 
 $20,000 that she will- iind in the safe deposit in New York, and she is 
 to take my keys and distribute the packages in box as they are marked, 
 and all my clothing and wearing apparel and silver. In short, every- 
 thing in the house shall be Mary P. Ga Nun's. [Signed] Jane M. 
 Sands. Louis W. Jansen, A. S. Leonard, M. D., W. G. Bouvier, Wit- 
 nesses.'' 
 
 The trial court found as facts that, in pursuance of such contract, 
 the plaintiff undertook the care and maintenance of Miss Sands, and 
 continued the same until May, 1900, when Miss Sands left her, and re- 
 moved from the plaintiff's home in Brooklyn to the defendant's resi- 
 dence in Poughkeepsie, with whotti she some time afterwards entered 
 into a similar oral contract with defendant, but for less compensation; 
 that she continued to reside with the defendant until she died on Au- 
 gust 17, 1906, leaving a will in which she made the defendant her sole 
 legatee and devisee, and appointed her sole executrix ; which will was 
 duly admitted to probate by the surrogate of Westchester county, who 
 issued letters testamentary to the defendant, who thereupon duly quali- 
 fied, and since has acted as such executrix. The court also found 
 that there was a breach of the contract by decedent in the early part 
 of May, 1900, at which time she left the house of the plaintiff with the 
 intention of never returning to reside with the plaintiff, and with the 
 intention of never permitting the plaintiff to care for her, all of which 
 was well known to the plaintiff at the time decedent left her house and 
 went to live with the defendant at Poughkeepsie ; that the plaintiff then 
 employed a lawyer to enforce her claim against the decedent, and he 
 presented bills for the $70 per month up to May 1, 1900, and wrote 
 to the decedent, demanding payment, and threatening action if payment 
 was not made. 
 
 This action, was brought on the 31st day of May, 1907, after the 
 death of Miss Sands, and the court found as conclusions of law that, 
 more than six years having elapsed , after the breach of the contract, 
 the plaintiff's right of action was barred by the statute of limitations! 
 
 None of the other issues raised by the pleadings have been tried out 
 or determined, and consequently the only question brought up for re- 
 view is that upon which the trial court has based its judgment. 
 
 The clause of the contract in which Miss Sands agreed to pay the 
 plaintiff $70 a month for the support of the house and her clothes, for 
 which the plaintiff presented a bill up to the 1st of May, 1900, presents 
 no question in dispute. There can be no doubt but that such payments 
 were due and pa,yable monthly, and that the amount thereof, at the 
 time the bill was presented, then being due and payable, the statute 
 commenced to run, andi six years having elapsed before her death, the 
 plaintiff's claim, therefore, became barred by the statute. We do not 
 
Sec. 4) ANTICIPATORY REPUDIATION AS A CAUSE OF ACTION 779 
 
 understand, however, that the plaintiff in this action claims to recover 
 for the monthly allowance specified, bilt bases her right of action upon 
 the further promise of Miss Sands that at her death the plaintiff is to 
 have the $20,000, which she would find in the safe deposit box. 
 
 The trial court, as we have seen, was of the opinion that there was 
 a breach of the contract in its entirety at the time the decedent left 
 the plaintiff's house, and that the statute also ran as to the claim for 
 $20,000. In reaching this result, the learned justice in his opinion re- 
 fers to the case of Henry v. Rowell, 31 Misc. Rep. 384, 64 N. Y. Supp. 
 488, affirmed on the opinion below, 63 App. Div. 620, 71 N. Y. Supp. 
 1137, as an authority upon this subject, which he was boutod to follow. 
 That was an action on quantum meruit to recover for the value of 12 
 years board and lodging furnished by the plaintiff to the decedent in 
 her lifetime, under an agreement to board and lodge her in his house- 
 hold as long as she should live ; she agreeing to leave him by will all of 
 the property she should own at the time of her death. After receiving 
 board and lodging from the plaintiff for 12 years, the decedent left 
 his abode and went elsewhere, and lived for 14 years thereafter, and 
 then died, leaving a will in which she disposed of her property to other 
 perspris.; Subsequently that action was brought. In that case it was 
 held that there was a breach of the contract at the time that the dece- 
 dent left the plaintiff's residence, and that the statute of limitations com- 
 menced to run at thaJt time; that there was but one cause of action 
 available to the plaintiff, and that was for the value of the board and 
 lodging furnished by him up to that time. In that case there was no 
 agreement to pay a definite sum for board and lodging per month or 
 by the year ; the only agreement, to pay therefor being the promise of 
 the decedent to make a will giving the plaintiff all of her property. It 
 is therefore apparent that but one cause of action existed in that case:. 
 But whether the court, correctly held that the action could not be main- 
 tained after the testatrix's death by reason of the running of the stat- 
 ute, we now express no opinion. 
 
 The case we have now under review differs from the above case, for 
 under the agreement that decedent promised to pay the plaintiff $70 a 
 month for the support of the house, etc., that being a definite, fixed 
 amount, payable monthly, for which an action could have been main- 
 tained therefor at the end of each month. With ref drenee to the other 
 provision of the agreement, instead of the decedent promising i:o make 
 •a will giving the plaintiff all of her property, she agreed at her death 
 that the plaintiff is to have the $20,000 in her safe deposit box, "and, 
 instead of this action being broug'ht for the value of services rendered 
 on quantum meruit, it is brought upon the contract ; the plaintiff claim- 
 ing the stipulated sum expressed therein. It may be that but one cause 
 of action exists in favor of the plaintiff for the breach of the $20,000 
 clause of the contract, and that such an action could have been main- 
 tained at the time the decedent left the plaintiff's house and went to 
 
780 EBPUDIATION (Ch. 1 
 
 reside elsewhere. But, in view of the fact that the plaintiff might meet 
 with misfortune, disabling her from carrying out her part of the con- 
 tract to care for the decedent "in sickness and in health as long as she 
 lives," thus rendering the determination of the amount of her damages 
 uncertain and difficult to prove, she saw fit to wait until the amount 
 specified in the contract became due by the terms thereof. Did she 
 have the right to do this ? In answering this question, we shall assume, 
 for the purposes of this review only, that the breach of the testatrix's 
 contract was of such a character as to amount to a notice to the plain- 
 tiff that she would not carry out the provision with reference to the 
 giving her $20,000 at the testatrix's decease, and that an action for 
 damages could have been maintained immediately after such breach. 
 The question thus arises as to whether the plaintiff was bound to treat 
 the contract as broken and bring her action, or might she, at her option, 
 treat the contract as still in force, and wait until the sum specified be- 
 came due under its terms? 
 
 In this case, as we have seen, the breach occurred after partial per- 
 formance. This fact was deemed of importance in the case of Henry 
 V. Rowell, supra, but we fail to see how it affects the right of the 
 plaintiff to exercise her option. It is quite true that there is a distinc- 
 tion made in the authorities with reference to contracts which still are 
 wholly executory, and are to be performed in the future ; but the dis- 
 tinction pertains to that which would constitute a breach of such con- 
 tracts. Where the contract is wholly executory, there must be some 
 express and absolute refusal to perform, or some voluntary act on the 
 part of the individual which renders it impossible for him to perform, 
 in order to' constitute an anticipatory breach for which an action will 
 lie; whereas, by a partially executed contract, the breach may result 
 from a failure to perform some of the provisions of the contract. But 
 in either case, after a breach by one party, the rights of the other party 
 and his remedies are the same as to the unexecuted provisions of the 
 contract. Howard v. Daly, 61 N. Y. 362, 19 Am. Rep. 285. 
 
 The leading case upon the subject of remedies is that of Hochster 
 v. De la Tour, 2 Ellis & Blackburn, 678. In that case the contract was 
 wholly executory. On the 12th day of April, the defendant had agreed 
 to employ the plaintiff in the capacity of a courier for a period of three 
 months from the 1st day of June. But subsequently, and before the 1st 
 day of June, the defendant gave the plaintiff notice that he would not 
 require his services. Lord Campbell, after discussing the authorities, 
 states his conclusions as follows : "But it is surely much more rational, 
 and more for the benefit of both parties, that, -after the renunciation of 
 the agreement by the defendant the plaintiff should be at liberty to 
 consider himself absolved from any future performance of it, retain- 
 ing his right to sue for any damage he has suffered from the breach 
 of it. Thus, instead of remaining idle and laying out money in prep- 
 arations which must be useless, he is at liberty to seek service under 
 
Sec. i) ANTICIPATOET REPUDIATION AS A CAUSE OP ACTION 781 
 
 another employer, which would go in mitigation of the damages to 
 which he would otherwise be entitled for a breach of the contract. It 
 seems strange that the defendant, after renouncing the contract, and 
 absolutely declaring that he will never act under it, should be permit- 
 ted to object that faith is given to his assertion, and that an opportun- 
 ity is not left to him of changing his mind. * * * The man who 
 wrongfully renounces a contract into which he has deliberately entered 
 cannot justly complain if he is immediately sued for a compensation 
 in damages by the man whom he has injured; and it seems reasonable 
 to allow an option to the injured party, either to sue immediately, or 
 to wait till the time when the act was to be done, still holding it as 
 prospectively binding for the exercise of this option, which may be ad- 
 vantageous to the innocent party, and cannot be prejudicial to the 
 wrongdoer." 
 
 In Frost v. Knight, L,. R. 7 Ex. Ill, Cockburn, C. J., after referring 
 to the case of Hochster v. De la Tour supra, and other cases, says: 
 "The promisee, if he pleases, may treat the notice of intention as in- 
 operative, and await the time when the contract is to be executed, and 
 then hold the other party responsible for all the consequences of non- 
 performance ; but in that case he keeps the contract alive for the benefit 
 of the other party as well as his own ; he remains subject to all his own 
 obligations and liabilities under it, and enables the other party not only 
 to complete the contract, if so advised, notwithstanding his previous 
 repudiation of it, but also to take advantage of any supervening cir- 
 cumstances which would justify him in declining to complete it. On 
 the other hand, the promisee may, if he thinks proper, treat the repudi- 
 ation of the other party as a wrongful putting an end to the contract, 
 and may at once bring his action as on a breach of it ; and in such ac- 
 tion he will be entitled to such damages as would have arisen from 
 the nonperformance of the contract at the appointed time, subject, 
 however, to abatement in respect of any circumstances which may 
 have afforded him the means of mitigating his loss." «* * * * 
 
 A further citation of authority hardly seems necessary, for the gen- 
 eral rule is that a right of action does not accrue upon a contract until 
 it is executed, or payment thereunder becomes due by its terms, and 
 the statute of limitations does not commence to run until that event 
 happens. The right to bring an action previous to that event is ex- 
 ceptional, and is only permitted in cases of a breach of a contract by 
 one of the parties which permits the aggrieved party at his option, to 
 maintain an action for such breach, and recover the damages he has 
 suffered on account thereof. In reaching this conclusion, we have 
 assumed, as above stated, that the breach was of such a character as to 
 
 '*The court has cited as in accord: Eoehm v. Horst, 178 V. S. 1, 20 
 Sup. Ot. 780, 44 L. Ed. 953 (1900) ; Heery v. Eeed, 80 Kan. 380, 102 Pac. 846 
 (1909) ; Foss-Schnetder Brewing Co. v. Bullock, 59 Fed. 83, 8 C. C. A. 14 
 (1893), Taft, J., and Pakas v. HoUingshead, 184 N. Y. 211, 77 N. E. 40, 3 L. R. 
 A. (N. S.) 1042. 112 Am. St. Rep. 601, 6 Ann. Cas. 60 (1906). 
 
782 ■ REPUDIATION (Ch. 4 
 
 permit the bringing of an action for damages. We do nOt, however, 
 wish to be understood as deciding that question,' for the! rule that re- 
 nunciation of a continuous executory contract by one party before 
 the day of performance, giving the other the right to sue at once for 
 damages, is usually applied only to contracts of a special character; 
 and the question whether it applies to such a contract as. we have under: 
 review we leave undetermined. Kelly v. Security Mutual Life Ins. 
 Co., 186 N. Y. 16, 78 N. E. 584, 9 Ann. Cas. 661 ; Adenaw v. Piffard, 
 202 N. Y. 122-129, 95 N. E. 555 ; 25 Cyc. 1074. * * * 
 Judgment reversed and new trial granted. 
 
 SMITH & RICE CO. V. CANADY. 
 (Supreme Judicial Court of Massachusetts, 1912. 213 Mass. 122, 99 N. E. 968.) 
 
 Bill by the Smith & Rice Company against James W. Canady to com- 
 pel specific performance. From a decree dismissing the, bill, plaintiff 
 appeals. Affirmed. , ^ . , 
 
 Morton, J. This is a biU in equity to compel specific performance, 
 by the defendant of the follo-yving agreement under seal.: 
 
 "I agree to, sell and convey, by warranty deed conveying, a good 
 title, free from all incumbrances, to Smith & Rice Co., corporation, 
 of Worcester, , Massachusetts, f oi" the suni of thirteen hundred dol- 
 lars, the following described property : The farm on which I now 
 live in Spencer, Mass., known as the McKonik farm, the deed of which 
 is recorded in Worcester District, Deeds Book 1875, page 307. Afso 
 all wood cut on farm and in shed at house and what hay may' be left 
 in the barn. Possession of said premises and a deed of the same shall 
 be delivered to the same Smith & Rice Co. on or before the 10th 
 day of April, 1911. Payment of the purchase, money shall be made 
 upon delivery of the deed. Witness my hand and seal, this 9th day 
 of March, 1911. 
 
 "Witness: [Signed] James W. Canady. [Seal.]" 
 
 The case was duly heard and a decree was entered dismissing the 
 bill without costs. The plaintiff appealed. 
 
 It appeared that shortly after the defendant signed the agreement 
 he attempted to revoke the offer contained in it by means of the fol- 
 lowing letter which was sent by him to and received by the plaintiff : 
 
 "Spencer, Mar. 17th, 1910. 
 
 "Mr. Rice — Dear Sir : I give you notice that I do hereby revoke 
 my, offer t9 sell to, you my farm in Spencer. You don't agree to buy it 
 nor do you give me a penny or other thing to hold it until you find 
 out whether you want, it or not and at the last moment you can tell 
 me you don't .want it and I lose other customers. That is not fair 
 or right., 
 
 . "Yours, [Signed] J. W.. Canady." 
 
Sec. 4) ANTICIPATORY EEPCDIATION AS A CAUSE OF ACTION 783 
 
 The letter appears to be dated 1910, but tHat is obviously a mistake 
 for 1911. The court found that the attempted revocation contained 
 in this letter was abandoned and given up by the defendant some 
 time about April 1, 1911. The facts found by the court warranted 
 such a finding. What was found by the court was that "some time 
 about April 1, 1911, at the request of the plaintiff, the defendant went 
 to the office of the plaintiff's attorney, and while there discussed with 
 the plaintiff the matter of the conveyance; was asked by the plaintiff 
 then to execute and deliver a deed of the premises, to which demand 
 the defendant replied that he was not bound to do such [so] under 
 his agreement "before the 10th day of April, 1911. The plaintiff then 
 requested the defendant to remain a short while until he, the plaintiff, 
 could procure at a nearby bank money sufficient to make a tender. 
 This request the defendant refused to comply with and left the office." 
 It also appeared that the defendant thereafter caused a proper deed 
 of conveyance to be prepared and remained at his dwelling house on 
 the premises the entire day of the 10th of April, ready and able to 
 deliver possession and title in accordance with his offer. 
 
 These facts plainly warranted a finding that the attempted revoca- 
 tion had been abandoned and, given up by the defendant, and that 
 the plaintiff must have so understood it and was bound to govern it- 
 self accordingly. The offer made by the defendant required the 
 plaintiff to tender- on or before April 10th the amount for which the 
 defendant agreed to seU and convey the farm. What took place in 
 the office of the plaintiff's attorney plainly did not constitute a tender, 
 and the court found that "the plaintiff thereafter, before the bringing 
 of this bill, never made demand upon the defendant for a deed of the 
 premises,, nor tendered nor offered to tender the price to be paid 
 for such conveyance." The time named in the offer was of the es- 
 sence of tlie agreement made by. the defendant, and even if what took 
 ; place in the attorney's office could be construed as, an acceptance by 
 the plaintiff of the defendant's offer the plaintiff was bound to tender 
 performance on its part before the expiration of the time named, in 
 order to entitle itself to a conveyance of the farm. As already ob- 
 served, it is clear that what took pl^ce in the attorney's office did not 
 constitute a tender, and it is expressly found that thereafter, before 
 the bringing of the bill, the plaintiff made no demand for a deed and 
 did not offer to pay the price required for a conveyance. There was 
 no §uch refusal to convey on the part of the defendant as to dispense 
 with a tender. Mengis v. Carson, 114 Mass. 410. The attempted 
 withdrawal of the offer was abandoned, not only without objection so 
 far as appears on the part of the plaintiff; but in consequence, as it 
 could have been found, of his holding the defendant to his offer, and 
 of the defendant's recognizing that he was bound to convey jf the 
 plaintiff insisted upon his doing so and complied with the conditions on 
 which the offer was made. As was said in Mengis v. Carson, supra : 
 "A mere declaration of unwillingness which shows only a passing 
 
784 REPUDIATION- (Ch. 4 
 
 intention on the part of the defendant of which he may repent, and 
 which does not amount to an assurance that the other party is re- 
 lieved from the part required of him" does not excuse the plaintiff 
 from performing such part. The defendant's recognition of his obliga- 
 tion to convey if the plaintiff insisted upon it was shown by his state- 
 ment to' the plaintiff, when the plaintiff asked for a deed, that he was 
 not bound to give a deed till April 10th, and by the fact that he caused 
 a proper deed to be prepared and was ready and able to give title 
 and possession on the 10th day of April. There was nothing tp ex- 
 cuse the plaintiff from a proper tender on or before the 10th day of 
 April, and the plaintiff not having made such tender was not entitled 
 to a conveyance and the bill was rightly dismissed. 
 Decree affirmed with costs of appeal.""* 
 
 (c) Measure; of Damages — Mitigation oe Damages 
 
 SCHELL V. PLUMB. 
 
 (Court of Appeals of New York, 1874. 55 N. T. 592.) 
 
 GrovER, J.°° The contract of the testator to support the plaintiff 
 during her life and his violation thereof are found by the verdict. The 
 judge held that upon these facts the plaintiff was entitled to recover, 
 not only the expense of her support to the commencement of the 
 action, but the entire amount of such expense during her life. To 
 this the defe;ndants excepted, insisting that if the plaintiff was entitled 
 to recover at all, she could only recover for the time prior to the 
 commencement of the action, or at most, to the time of the trial. 
 Upon this question the authorities are somewhat conflicting ; but an 
 examination satisfies me that the rule adopted by the judge is sus- 
 tained by those best considered. Fish v. FoUey, 6 Hill, 54, was an 
 action iipon a covenant of the defendant's intestate with the plaintiff 
 to furnish him with sufficient water from the intestate's mill-dam to 
 carry his fulling mill and carding machine, unlimited in duration. 
 
 6 5 The repudiator has no power of retraction after the other party has 
 accepted it as final and acted in reliance thereon. Kipley v. McClure, 4 
 Exch. 345 (1849) ; Rayburn v. Comstock, 80 Mich. 448, 45 N. W. 378 (1890) ; 
 Nilson V. Morse, 52 Wis. 240, 9 N. W. 1 (1881). But prior thereto he has such 
 power. Avery v. Bowden, 5 E. & B. 714 (1856) ; Kadish v. Young, 108 111. 
 170, 43 Am. Kep. 548 (1883) ; Roebling's Sons' Co. v. Lock-Stitch Fence Co., 
 130 111. 660, 22 N. E. 518 (1889) ; Stanford v. McGill, 6 N. D. 536, 72 N. W. 
 938, 38 L. R. A. 760 (1897). 
 
 <" Part of the opinion is omitted. The Northampton life tables were held 
 admissible to prove plaintiff's life expectancy. 
 
Sec. 4) , MEASURE OF DAMAGES — MITIGATION OF DAMAGES 785 
 
 It was held that a previous action in which damages were recovered 
 up to the commencement of the action was a bar to a subsequent ac- 
 tion for breaches after the commencement of the former action. 
 Nelson, C. J., says in the opinion that the covenant stipulated for a 
 continued supply of water to the plaintiff's mills, and in this respect 
 may be appropriately styled a continuing contract ; yet, like any other 
 entire contract, a total breach put an end to it and gave the plaintiff a 
 right to sue for ah equivalent in damages. He obtained that equivalent, 
 or should have obtained it in the former suit. This is in principle pre- 
 cisely analogous to the present case. Here tlie contract of the testator 
 was to support the plaintiff during her life. " That was a continuing 
 contract during that period, but the contract was entire and a total 
 breach put an end to it, and gave the plaintiff a right to recover an 
 equivalent in damages, which equivalent was the present value of her 
 contract. Shaffer v. Lee, 8 Barb. 412, was -an action upon a bond 
 conditioned to furnish the obligee and his wife with all necessary 
 meat, etc., during both and each of their lives. It was held to be an 
 entire contract, and that a failure to provide according to the sub- 
 stance and spirit of the covenant amounted to a total breach, and that 
 full and final damages might be recovered for the future as well as 
 the past. It is obvious that the right to recover a full equivalent 
 upon a breach is the same when the contract is by^ parol as when it is 
 evidenced by an instrument under seal. Dresser v. Dresser, 35 Barb. 
 573, was upon a like contract by parol, and it was held that upon 
 a breach the entire damages might be recovered. 
 
 The counsel for the appellants insists that' such cannot be the rule, 
 for the reason as he insists, that it is impossible to ascertain the 
 darnages, as the duration of life is uncertain, and a further uncertain- 
 ty arising from the future physical condition of the persbn. Guthrie 
 V. Pugsley, 12 Johns. 126, and Wager v. Schuyler, 1 Wend. 553, show 
 that the former reason has no force. In each of these cases the value 
 of a life estate in real estate was determined in actions upon the breach 
 of covenants of warranty, as to which the uncertainty as to the dura- 
 tion of life was the same as in the present case. It may be further 
 remarked that in actions for personal injuries the constant practice 
 is to allow a recovery for such prospective damages as the jury are 
 satisfied the party will sustain, notwithstanding the uncertainty of 
 the duration of his life and other contingencies which may possibly 
 affect the amount. The counsel for the appellants cites cases where 
 it has been held that in actions for a continuing injury to. real estate, 
 damages can only be recovered to the commencement of the action, 
 and that subsequent actions may be brought for damages sustained 
 thereafter. This is the undoubted rule in this class of actions, but 
 has no application to actions upon contracts which are entire. Cases 
 are also cited applying the same rule in actions upon covenants to 
 repair. Beach v. Grain, 2 N. Y. 86, 49 Am. Dec. 369, was of the 
 latter class. Ferguson v. Ferguson, 2 N. Y. 360, was a case, as ap- 
 
 COKBIN CONT 50 
 
786 REPUDIATION (Ch. i 
 
 pears from the facts stated, of a partial and not total breach of the 
 contract, in which it was correctly held that a recovery could only 
 be had for the partial breaches that had occurred. * * * 
 Judgment affirmed.' ' 
 
 WIGENT V. MARKS. , 
 
 (Supreme Court of Michigan, 1902. 130 Mich. 609, '90 N. W. 423.) 
 
 Action by Gardner A. Wigent against Thomas Marrs, administrator 
 of the estate of Chloe R. McClung, deceased. There was a judgment 
 in favor of defendant, and plaintiff brings error. Affirmed. 
 
 Hooker, C. J. Plaintiff recovered a verdict and judgment in an 
 action of assumpsit before a justice of the peace, which was reversed 
 in the circuit court on appeal. The declaration was Upon the common 
 counts. The facts were undisputed, and in substance are as follows: 
 In May, 1901, defendant's intestate gave a written order to plaintiff's 
 agents for a monument to be erected upon her lot in the cemetery at 
 the agreed price of $100, the same^ to be completed between that 
 date and June 30, 1901, miless unforeseen causes should prevent, and 
 in that event as soon thereafter as practicable. It was to be set upon 
 a foundation to be erected by her. The contract was approved by the 
 plaintiff on May 14th, of which Mrs. McClung was notified, and at 
 the same time the monument was ordered to be made at the quarry. 
 The latter part of June the plaintiff notified her to get the foundation 
 ready, in response to which she wrote him that he need not bring that 
 monument, as it did not come according to agreement. On July 5th 
 plaintiff replied, stating that the monument was well under way, and 
 he could not allow her to countermand her order; that it would be 
 delivered as soon as completed, and would be strictly according to con- 
 tract, and she was requested to have her foundation built as soon as 
 possible. In response to this she wrote : "You have not done accord- 
 ing to agreement at all. You was to have it up by the 30th of June 
 at the farthest. We are not obliged to wait your motion, so, .if you 
 bring it, you may take it back." The plaintiff had the monument com- 
 pleted and set up upon a foundation erected by himself. This action 
 was brought to recover the contract price and $1.50 for the foundation, 
 with interest from August 23, 1900. 
 
 It was shown that the delay was caused by unforeseen circumstances. 
 No complaint was. made of the workmanship, which was such that 
 the monument could not be used for any other purpose. The defend- 
 ant claims that the plaintiff, upon receipt of Mrs. McClung's letter, had 
 no legal right to complete the contract and recover the price ; that his 
 
 67 In accord: Parker v. Russell, 133 Mass. 75 (1882) ; United Press Ass'n 
 V. Natl. Newspaper Ass'n, 237 Fed. 547, 150 C. C. A. 429 (1916) ; Golden Cycle 
 Min. Co. V. Rapson Coat Min. Co., 188. Fed. 179, 112 C. C. A. 95 (1911) ; 
 Jspeirs v. Union Drop Forge Co., 1,80 Mass. 87, 61 N. E. 825 (1901) ; Suther- 
 land V. Wyer, 67 Me. 64 (1877), servant discharged. 
 
Sec. 4) MEASURE OF DAMAGES— MITIGATION OF DAMAGES 787 
 
 only remedy was to reqover, in damages for a breach of. the contract. 
 Plaintiff, on the other hand, claims that it, ^was" competent to treat the 
 contract as performed, and that he is .entitled to recover the contract 
 price upon the common counts, It is undisputed that defendant un- 
 qualifiedly renounced this contract before the monument was com- 
 pleted, and- forbade its completion and erection upon her premises. 
 Many authori]ties hold that she had the right to do this, ^nd thereafter 
 plaintiff's right of recovery would be limited to damages for the breach 
 of the contract involved in the renunciation. I^n Mechem, Sales, § 
 1091, the author says : "The law is well settled that a party to an 
 executory contract may always stop performance on the other side 
 by an explicit direction to that effect, though he thereby subjects 
 himself to the payment of such damages as will compensate the other 
 for the loss he has sustained by reason of having his performance 
 checked at that stage in its progress." "The contract is not rescinded, 
 but broken; andj. immediately the other party has the right to deem 
 it in force for the purpose of the. recovery of his damages, he is un- 
 der no obligation for that, purpose to tender complete performance, 
 nor has he the right to unnecessarily enhance the damages by pro- 
 ceeding after the coimtermand to finish his undertaking." Id. § 1092. 
 
 This subject is discussed in the case of Hosmer y. Wilson, 7 Mich., 
 at page 305, 74 Am, Dec. 716, whsiT^t Mr. Justice Christiancy says : 
 "And it is certainly very questionable whether the party thus notified 
 has a right to go on after such notice to increase the amount of his 
 own damages. In Clark v. Marsiglia, 1 Denio (N. Y.) 317, 43 Am. 
 Dec. ,670,, it was held hp_ had no such right, and that the employer has 
 a right (in a contract for work andlabor) to stop the work, if he choose, 
 subjecting. himself to the consequences of a breach of his contract; 
 and that the workman, after notice to quit work, has no right to con- 
 tinue his labor, and recover pay for it. This doctrine is fully ap- 
 proved in Derby v. Johnson, 21 Vt. 21." Mr. Justice Christiancy 
 adds that: "This >vould seem to be good sense, and therefore sbund 
 law; and it would seem that any other rule must tend to the injury, 
 and in many cases to the ruin, of all, parties." In the case of Danforth 
 v. Walker, 37 Vt. 244, the ' court said of a similar case: "While a 
 contract is executory, a party has the power to stop the performance on 
 the other side by an explicit direction to that effect by subjecting him- 
 self to such damages as will compensate the other party for being 
 stopped in the performance on bis part at that, point or stage in the 
 execution of the contract. The party thus forbidden cannot afterwards 
 go on and thereby increase the damages, and then recover such in- 
 creased damages of the other party." See, also, Butler y. Butler, 
 77 N. Y. 472, 33 Am. Rep^ 648; Clause v. Printing Press Co., 118 111. 
 ,612, 9 N. E. 201. ' 
 
 We are cited by plaintiff's counsel to the case of Black v. Herbert, 
 111 Mich. 638, 70 N. W. 138, as a, case on all fours with the present 
 case, but we think it is readily distinguishable. In that case, after re- 
 
788 EBPUDIATION (Ch. 4 
 
 nunciation the parties met by appointment, and the plaintiff was per- 
 mitted to alter and set up the monument. It became, therefore, a ques- 
 tion for the jury whether or not the contract had been performed. 
 Renunciation must be more than mere idle talk of nonperformance; 
 it must be a distinct, unequivocal, and absolute refusal to receive per- 
 formance or to perform on his own part. Mechem, Sales, § 1087. 
 The party attempting to renounce may withdraw his renunciation 
 and have the contract performed (Id. § 1090), and it would seem 
 that the defendant in that case did so. There are only two theories 
 upon which the common counts could be relied upon in this case: 
 First, upon the theory that the contract had been performed, and 
 that the contract price was therefore recoverable; and, second, for 
 the work and material used in the foundation built by the plaintiff. 
 The undisputed facts show that the contract was not performed on 
 receipt of the renunciation, and there could be no recovery for the 
 erection of the foundation, because the plaintiff was never requested 
 to build it, but, on the contrary, was prohibited from doing anything 
 further in performance of the contract. The only redress that the 
 plaintiff would be entitled to recover would be damages for the breach 
 of the contract if renunciation should be found to be unwarranted, 
 which does not appear. 
 
 It follows that the judgment must be affirmed. 
 
 HART-PARR CO. v. FINLEY. 
 
 (Supreme Court of North Dakota, 1915. 31 N. D. 130, 153 N. W. 137, L. 
 R. A. 1915E, 851, Ann. Cas. 1917E, 706.) 
 
 Action by the Hart-Parr Company, a corporation, a|;ainst Frank 
 Finley. From a judgment for defendant, plaintiff appeals. Affirmed, 
 and rehearing denied. 
 
 Goss, J."* This action is to recover $2,400 damages as the purchase 
 price of an engine plaintiff claims to have sold and delivered defend- 
 ant, together with an additional $104 freight charge thereon. June 10, 
 1912, defendant executed and delivered the usual written machinery 
 order to plaintiff. It was duly accepted. Before the stipulated time 
 for delivery, defendant notified plaintiff he would not receive the en- 
 gine and to cancel his order. Plaintiff refused cancellation, insisting 
 upon full performance. On receipt of defendant's written notice of 
 revocation, and on June 29th, plaintiff wrote defendant as follows : 
 
 "Referring to your letter of June 22d, in which you ask us to can- 
 cel your order, wish to say that we cannot do this. * * * fjie or- 
 der contains no provision for cancellation, and like any other contract 
 it cannot be abrogated or annulled without the consent of all the par- 
 ties thereto. We wiU ship you the engine promptly on July 15th [the 
 date specified for shiprnent in the order], and will carry out our part 
 
 "* Parts of the opinion and the opinion on rehearing are omitted. 
 
Sec. 4) MEASURE OF DAMAGES — MITIGATION OF DAMAGES 789 
 
 of the contract in every detail. We shall then insist that you carry 
 out yours, and you have absolutely no grounds whatever upon which 
 to refuse to do so." 
 
 Defendant's reply, duly received, was : "Yours of the 28th of June, 
 refusing to cancel order, at hand. * * * Now I positively will 
 not receive said engine and do not think you are giving me a square 
 deal in trying to hold me up. If it is a 'case of damages, make a state- 
 ment and I will consider it. But if you wish to go to law, I am ready," 
 
 On July 15th, the earliest date fixed for performance, plaintiff ten- 
 dered the engine to defendant f . o. b. at Forest River, according to 
 the terms of the contract. He refused to accept it or to execute and 
 deliver his notes or pay the freight. On August 13th, and within the 
 stipulated period for performance, plaintiff took said tractor to the 
 home of defendant, and unconditionally tendered it to him in perform- 
 ance of its obligation. Defendant refused to receive the engine, which 
 plaintiff then left at his farm, against his expressed wishes and pro- 
 test and without his consent. The freight from the factory to Forest 
 River was $104. . 
 
 These are the findings. The appeal is from the judgment of dis- 
 missal, raising only the legal conclusions to be drawn from the find- 
 ings. The decision is the answer to whether a suit can be maintained 
 for the purchase price and freight added, as for damages suffered by 
 the failure of the defendant to receive the stock engine ordered for 
 future delivery to him, where, before the tithe for delivery, he had 
 given plaintiff his unequivocal and unconditional notice of cancellation 
 of his order and that he would neither receive the engine nor pay for 
 it, with defendant refusing to receive or pay for the engine and insist- 
 ing upon his repudiation. 
 
 Plaintiff claims: (1) That the attempted cancellation and notice 
 was ineffectual for any purpose and amounted to but defendant's offer 
 that the contract might be canceled, which offer was rejected, leaving 
 the written contract in force, under which, however, it was not obliged 
 to tender the engine in the face of the defendant's offer and refusal to 
 receive it, but nevertheless it claims it did deliver it to him, and there- 
 by parted with its title, and therefore can recover damages as for the 
 purchase price; and (2) irrespective of the passing of title, the or- 
 der should be construed as authorizing a recovery for $2,400 and 
 freight, inasmuch as such is plaintiff's contract rights, because payment 
 was not conditioned upon the passing of title as a condition either 
 precedent or concurrent. Defendant asserts that: (1) Title did not 
 vest in defendant, as the contract was repudiated before delivery, upon 
 which repudiation an action for damages only for such breach is ac- 
 corded to the seller, with the measure of damages recoverable fixed by 
 section 7156, C. L. 1913, as declared, where the title does not pass to 
 the purchaser; and (2) that a purchaser has a right to stop perform- 
 ance of an executory contract of purchase and sale by notice of its 
 cancellation, and the question of breach of contract by anticipation is 
 
790 REPUDIATION (Ch. 4 
 
 not involved; and (3) that, upon notic6 of cancellation, it became the 
 duty of the seller to mitigate its damages, rather than enhance them, 
 and that freight paid for the shipment made after notice of cancella- 
 tion was such an enhancement of its damages. 
 
 The questions presented are whether: (1) This purchaser had a 
 right to cancel his executory contract of purchase while it remained 
 wholly executory ; (2) the effect of his attempted cancellation thereof ; 
 (3) the measure of damages for the breach; and (4) the effect of can- 
 cellation to mitigate such damages. 
 
 The difficulty, is not in passing upon the issues in the light of the 
 common law alone or of our statutes but declaratory thereof, but in- 
 stead arises in their solution in harmony with both the common law 
 and consonant in reason with the holding and the principles announc- 
 ed in Stanford v. McGill, 6 N. D. 536, 72 N. W.' 938, 38 L. R. A. 760, 
 wherein was repudiated the common-law doctrine that there could be 
 an anticipatory breach of a wholly executory contract of purchase 
 and sale. Stanford v. McGill is the bulwark behind which the plain- 
 tiff is entrenched. Under the doctrine of that case, it reasons that 
 this attempted cancellation is ineffectual, except to relieve it from the 
 necessity of making a tender; that the contract never was breached 
 until refusal to accept the tendered property; that the attempted can- 
 cellation in no wise relieved defendant from his obligation to purchase 
 and pay the purchase price, inasmuch as it constituted but a mere 
 offer, the rejection of which left the contract unaffected, and under 
 which it has performed promptly and punctually upon the first day 
 upon which it could elect to perform ; that it thereby cast tide upon 
 defendant and can recover the purchase price therefor; that it can 
 recover as damages for freight paid, because, if it can disi^egard the 
 cancellation at its pleasure that cannot logically furnish a foundation 
 for minimizing such damages necessarily incurred in moving the ma- 
 chine to Forest River, that it might be there for tender on July 15th; 
 that, under the reasoning of Stanford v. McGill, it had the right to 
 expect that, notwithstanding defendant's attempted repudiation, he 
 would nevertheless repent thereof- upon a tender made to him, and 
 perform; that accordingly it had the right to make shipment and 
 place itself in readiness to perform its part on the first day possible; 
 that it is therefore entitled to recover at least the freight, inasmuch 
 as that damage should not be mitigated on any plea that it should take 
 notice of a futile attempt at cancellation and anticipate that defend- 
 ant's refusal would be the result of the tender, to do which is diamet- 
 rically contrary to one of the chief reasons for the holding in Stanford 
 V. McGill. And appellant can confidently inquire why it should be 
 compelled to recognize an attempted repudiation for purposes of 
 mitigation of damages, inoperative under Stanford v. McGill, to re- 
 lieve defendant from his performance, and when the attempted re- 
 pudiation itself did not affect the original rights of plaintiff. under the 
 contract. 
 
Sec. 4). MEASURE OF DAMAGES — MITIGATION OF DAMAGES 791 
 
 How can you mitigate as to the amount of the necessary expense of 
 performance when the contract is unaffected by the attempted repudi- 
 ation and consequently valid as an entirety during the time the ex- 
 pense to be mitigated was incurred? Plaintiff propounds, in effect, 
 these questions for answer. "A party to an executory contract may al- 
 ways stop performance on the other side by an explicit direction to 
 that effect, though he thereby subjects himself to such damages as 
 will compensate the other for the loss he has sustained by having his 
 performance checked at that stage of its progress." 2 Mechem on 
 Sales, § 1091. This is the settled law even in Massachusetts (which, 
 together with North Dakota and Nebraska, are the only states re- 
 jetting the doctrine of anticipatory breach of executory contracts), 
 as there declared in Collins v. Delaporte, 115 Mass. 159-162, in these 
 words: "A party to an executory contract may stop the perform- 
 ance by an explicit order, and will subject himself only to such dam- 
 ages as will compensate the other party for being deprived of its bene- 
 fits "-^and is also recognized as the law in Parker v. Russell, 133 
 Mass. 74. 
 
 But the application of this general rule of law seems inconsistent 
 with the doctrine that there can be no anticipatory breach, but yet 
 that the notice, although not operating to a,ffect the contract rights in 
 the least, nevertheless as to damages recoverable may in effect "stop 
 performance." As all, the law is to this effect, our holding could be 
 ^based upon this principle alone as to tliis phase of the case. However, 
 to do so and to cite, affirm, or leave intact the declai-ed doctrine in 
 Stanford v. McGill would seem to be applying a general rule of law 
 uijharmonious with logical results of the principles and reasoning in 
 that case. Recent authorities sustain the doctrine of anticipatory 
 breach: 6 R. C. L. §§ 384-387.«'' * * * 
 
 When Stanford v. McGill was decided, there may have been some 
 doubt about what the trend of authority might be in the future, but 
 the contrary rule has since been unanimously followed, and the law 
 generally applicable to executory sale contracts settled in harmony 
 therewith. As no propertj'' rights can be involved, inasmuch as no rule 
 of property could have grown out of that decision, no harm can come 
 from harmonizing the law in this jurisdiction with that generally pre- 
 vailing. Accordingly Stanford v. McGill to that extent is overruled. 
 The notice of repudiation given was such as might have authorized 
 plaintiff to have considered the entire contract as breached, and brought 
 its action immediately for damages, had it so elected. But this it did 
 not do, and the option to do so rested with it ; and, at the time stipulated 
 for performance, plaintiff was charged with notice previously given 
 that the defendant would iiot receive the property, which obviated nec- 
 
 *° The court here cited many recent eases, most of which appear in pre- 
 vious notes herein, and quoted from O'Neill v. Supreme Council American 
 Legion of Honor, 70 N. J. taw, 410, 57 Atl. 463, 1 Ann. Gas. 422 (1904), and 
 Roehm v. Horst, 178 U. S. 1, 20 Sup. Ot. 780, 44 L. Ed./953;:(1900). 
 
792 REPUDIATION (Ch. 4 
 
 essity of a tender or of any further act by it. Sections 5775 and 5824, 
 C. L. 1913. It could treat the contract as subsisting "up to the time 
 when performance should commence, for the purpose of insisting that 
 the other party, who has previously repudiated it, shall then and finally 
 determine whether he will comply with its terras or persist in .his reso- 
 lution not to perform upon his part. But the party who has not broken 
 his compact is not allowed to treat it as in force for the purpose of per- 
 forming in direct opposition to the refusal of the other to abide by its 
 terms, and then enforce the payment of the contract price." '^o * * * 
 
 As to the assertion that title was vested in defendant, and that there- 
 fore it could sue for the purchase price, title could not be cast upon de- 
 fendant in the face of his persistent refusal to accept title or the en- 
 gine. .There are cases where delivery may be constructively made or 
 may be presumed, but that is not ours. The contract remains execu- 
 tory, and no title passes as on an executed sale until the buyer accepts 
 a delivery of the property.''^ * * * 
 
 The purchase price cannot be recovered as the measure of damages, 
 in the absence of a provision in the contract to the contrary, unless title 
 to the goods has vested in the purchaser, as the transfer of title and 
 payment therefor are in contemplation of law concurrent acts, and 
 "if the buyer refuses to accept the goods, even wrongfully, he cannot be 
 sued for the price, because the event on which he undertook to pay the 
 price has not happened." White v. Solomon, 164 Mass. 516, 42 N. E. 
 104, 30 L. R. A. 537; Reeves & Co. v. Bruening, 13 N. D. 157, 166, 
 100 N. W. 241 ; Minneapohs Mch. Co. v. McDonald, 10 N. D. 408, 
 87 N. W. 993, construing section 7156, C. I,. 1913. 
 
 Plaintiif claims the right to recover independently of the passing of 
 title, as on a contract stipulating for the payment of money without the 
 passing of title being a condition either precedent or concurrent to pay- 
 ment. There are two equally conclusive answers to this contention: 
 First, there is no basis in the pleadings for such a claim as it sues as 
 for recovery of a purchase price of property sold and delivered; and, 
 secondly, the contract itself negatives such a claim, showing on its face 
 to be a contract for the purchase and sale of personal property with 
 payment by notes stipulated to be made as a condition concurrent up- 
 
 '"> The court here cited section 5586, C. L. 1913 ; Nichols & Shepard Co. v. 
 Paulson, 6 N. D. 400, 71 N. W. 136 (1897) ; Ctolean Mfg. Co. v. Blanchett, 16 
 N. D. 341, 113 N. W. 614 (1907) ; Reeves & Co. v. Bruening, 13 N. D. 157, 166, 
 100 N. W. 241 (1904) ; Colean Mfg. Co. v. Feckler, 20 N. D. 188, 195, 196, 126 
 N. W. 1019 (1910) ; Westby v. J. I. Case Threshing Mach. Co., 21 N. D. 575, 
 589, 590, 132 N. W. 137 (1911). 
 
 '1 The court here cited 6 R. C. L. 1026; Danforth y. Walker, 37 Vt. 239 
 (1864) ; Davis v. Bronson, 2 N. D. 300, 50 N. "VV. 836, 16 L. E. A. 655, 33 
 Am. St. Rep. 783 (1891) ; Collins v. Delaporte, 115 Mass. 159 (1874) ; Gib- 
 bons V. Bente, 51 Minn. 499, 53 N. W. 756, 22 L. R. A. 80 (1892) ; note to 33 
 Am. St. Rep. 795, 796; Kadlsh v. Young, 108 111. 170, 43 Am. Rep. 548 (1883) ; 
 RoebUng Sons Co. v. Lock-Stiteh Fence Co., 130 111. 660, 22 N. E. 518 (1889) ; 
 Acme Food Co. v. Older, 64 W. Va. 255, 61 S. E. 235, 17 L. R. A. (N. S.) 
 807, and note (1908). 
 
Sec. 4) MEASURE OF DAMAGES — MITIGATION OF DAMAGES 793 
 
 on delivery of such property with title the consideration for the notes. 
 Acme Food Co. v. Older, 64 W. Va. 255, 61 S. E. 235, 17 h. R. A^(N. 
 S.) 807. 
 
 To summarize in conclusion. Defendant had the right to tender a 
 breach of the contract by notice that he would never perform, which 
 repudiation plaintiff might have elected to accept as a present and im- 
 mediate breach. Stanford v. McGill, 6 N. D. 536, 72 N. W. 938, 38 
 L. R. A. 760, is to this extent overruled. Instead it elected to keep the 
 contract alive until the stipulated time for performance arrived, when, 
 defendant not having withdrawn his renunciation, it cou4d dispense 
 with tender of performance and sue for damages. This it elected not 
 to do, but chose to make a tender and afford defendant a further oppor- 
 tunity to receive it, in the event of which reception of the property he 
 could have been sued for the purchase price. However, he refused to 
 receive either property or title, standing upon his repudiation of the 
 contract, but thereby rendering himself liable for all damages accruing 
 to the other party because of such breach. The measure of damages 
 for breach is by section 7156, C. L. 1913, and the common law governed 
 by a different rule from where title has been vested, in which event it 
 is to be deemed to be the contract price. Section 7155, C. L,. 1913. As 
 this suit is for the contract price for goods sold and delivered, it is 
 not maintainable. There is an entire failure of proof of damages. As 
 to the freight paid, the findings do not disclose but what this expense 
 was incurred after notice of repudiation operated to check further 
 performance. That defendant did not observe it, if the freight expense 
 was incurred thereafter, was at plaintiff's own election and taken at 
 the hazard that it could induce defendant to later perform the contract. 
 It is in contemplation of law an enhancement of damages after notice 
 of repudiation, and is not recoverable. 
 Judgment affirmed.'^^ 
 
 ^2 It is now almost invariably held that in case of a repudiation before 
 performance by the other party is completed, such other party cannot increase 
 his recovery by continuing to perform. He has a right to damages caused by 
 the breach, enforceable in express assumpsit; also, in the alternative, a right 
 to the value conferred upon the repu'diator by part performance, en- 
 forceable in indebitatus assumpsit; but he has not a right to the contract 
 price enforceable in debt, nor has he the power to create such a 
 right by continued performance. Clark v. Marsiglia, 1 Denio (N. Y.) 317, 43 
 Am. Dec. 670 (1845), service contract; Howard v. Daly, 61 N. Y. 362, 19 
 Am. Rep. 285 (1875) ; James v. Allen Co., 44 Ohio St. 226, 6 N. E. 246, 58 Am. 
 Eep. 821 (1886) ; Olmstead v. Bach, 78 Md. 132, 27 Atl. 501, 22 L. R. A. 74, 
 44 Am. St. Rep. 273 (1893) ; Litchenstein v. Brooks, 75 Tex. 196, 12 S. W. 975 
 a889) ; Little Butte Oonsol. Mines Co. v. Girand, 14 Ariz. 9, 123 Pac. 309 
 (1912) ; Bridgeford & Co. v. Meagher, 144 Ky. 479, 139 S. W. 750 (1911) ; 
 Pierce v. Tennessee Coal, Iron & R. Co., 173 U. S. 1, 19 Sup. Ct. 335, 43 L. 
 Ed. 591 (1899) ; Listman Mill Co. v. Dufresne, 111 Me. 104, 88 Atl. 354 (1913), 
 goods shipped after repudiation ; Davis v. Bronson, 2 N. D. 300, 50 N. W. 
 836, 16 L. R. A. 655, 33 Am. St. Rep. 783 (1891), building erected; 
 Richards v. Manitowoc & N. Traction Co., 140 Wis. 85, 121 N. W. 937, 133 
 Am. St. Rep. 1083 (1909) ; Trinidad Asphalt Mfg. Co. v. BuckstafC Bros. Mfg. 
 Co., 86 Neb. 623, 126 N. W. 293, 136 Am. St. Rep. 710 (1910). 
 
 It is often held that the plaintiff is prima facie entitled to the full contract 
 
794 BEPUDIATION (Ch. 
 
 JAMESON V. BOARD OF EDUCATION. 
 
 (Bupreme Court of Appeals of West Virginia, 1915. 78 W. Va. 612, 89 S. E. 
 255, L. R. A. 1916F, 926.) 
 
 Action by Hallie Janes Jameson against the Board of Education, 
 etc. Judgment for plaintiff, and defendant brings error. Reversed, 
 and judgment entered for defendant. 
 
 WiLi^iAMS, P. Plaintiff recovered a judgment against defendant for 
 $609.67, the amount of seven months' wages, claimed to be due her on 
 a contract of employment as teacher of music in the public schools of 
 the cities of Benwood and McMechen, in the school district of Union, 
 Marshall county, and by "this writ of error defendant seeks a reversal. 
 
 Plaintiff declared upon the special contract, averring that she was 
 employed by defendant for a period of nine months, beginning on the 
 11th of September, 1911, and continuing for nine school months, on 
 an agreed salary of $75 per month, payable monthly; that throughout 
 
 price as his damages, and that the burden is on the repudiator to show that 
 the plaintiff either did mitigate the loss or reasonably could have done so. 
 See International Text-Book Co. v. Martin, 82 Neb. 403, 117 N. W. 994 (1908) ; 
 Grant v. New Departure Mfg. Co., 85 Conn. 421, 83 Atl. 212 (1912), Wheeler, 
 J., dissenting ; Maynard v. Royal Worcester Corset Co., 200 Mass. 1, 85 N. 
 E. 877 (1908). 
 
 In sales of goods, where title has passed, of course debt lies against a re- 
 pudiating buyer. Many cases also hold that, where the goods are ready for 
 delivery at the time of repudiation, the seller can vest title in the buyer 
 against his will and then get judgment for the agreed price. See American 
 Uniform Sales Act, § 63(3) ; Williston, Sales, § 562; Dustan v. McAndrew, 
 44 N. Y. 72 (1870) ; Home Pattern Co. v. W. W. Mertz Co., 88 Conn. 22, 90 
 Atl. 33 (1914). 
 
 "Duty" to Mitigate Damages. In Rock' v. Vandine, 106 Kan. 588, 189 Pac 
 157 (1920), the defendant made a counterclaim for damages caused by 
 Inferior flour supplied by the plaintiff. The flour was unfit for bread as 
 usually made, but was later used by the defendant as a permitted war-time 
 substitute for flour. Mr. Justice Burch said : 
 
 "The plaintiff says it was the defendant's duty to mitigate his damages by 
 using the flour in the way which would occasion the least possible loss. The 
 defendant claimed nothing on account of loss of custom before he was per- 
 mitted to make Inferior bread under the substitute regulation. When the 
 regulation became effective, he did use the flour in the most beneficial way. 
 
 "In this connection it may be Observed that, accbrding to the classification 
 of jural relations proposed by the late Prof. Hohfeld, of Tale University, 
 the term "duty" is misapplied in the statement of the plaintiffs contention 
 relating to the defendant's counterclaim. The classification follows: 
 
 Tural Onrositps i '*^'^* privilege power immunity 
 
 Jural upposites ^ ^^ ^.^^^^ ^^^^ disablUty liability 
 
 Tnrfll Correlatives i ^^^^^ privilege power immunity 
 
 Jural correlatives -j ^j^^y no right liability disability 
 
 Hohfeld, Fundamental Legal Conceptions, p. 65 ; 26 Yale L. J. 710. 
 
 "According to this classification, which appears to be sound, and which, if 
 observed, ought to conduce to clarity of thought and precision of expression, 
 the defendant rested under no duty to the plaintiff to mitigate damages by 
 using the flour to the best advantage. If so, he himself would have been sub- 
 ject to an action for damages resulting from breach of the duty. The correct 
 statement would be that the defendant rested under legal disability to coun- 
 terclaim for damages which he might have prevented." 
 
Sec. 4) MEASURE OF DAMAGES — MITIGATION OF DAMAGES 795 
 
 the term of employment she stood ready to .perform her part of the 
 contract; that she a;ppeaTed at the schools on the morning of each 
 school day and demanded of the respective superintendents thereof 
 tha,t her work be assigned her ; and that she did actually perform her 
 part of the contract. The declaration contains also lie common 
 counts in assumpsit. The only breach averred is the failure and re- 
 fusal of defendant to pay the wages for the last seven months of the 
 schools. ■ 
 
 Defendant pleaded the general issue, and also tendered a special 
 plea, which the court rejected on motion of plaintiff. It averred that 
 plaintiff had theretofore sued defendant and recovered a judgment 
 against it for $150, on account of salary claimed by plaintiff for the 
 first two months of School, ending, respectively, on the 6th of October 
 and the 3d of November, 1911 ; that it was proven, on the trial of that 
 action, that defendant had revoked or attempted to revoke plaintiff's 
 appointment as music teacher, and had refused to permit her to teach, 
 and that she had not, in fact, taught, though she held herself in readi- 
 ness to do so; and that said judgment is still in force. Wherefore de- 
 fendant prayed judgment whether plaintiff ought to have or maintain 
 her present action. 
 
 The case was tried by the court in lieu of a jury, upon an agreed 
 statement of facts, from which it appears that the plaintiff was not 
 permitted by defendant to teach; that it sued out a writ of injunction 
 to prevent her from continually appearing at the schools for the pur-' 
 pose of teaching, which writ was later dissolved on her motion. It 
 thus appears that plaintiff actually performed no part of the contract^ 
 although she was at all times ready to do so, but that she was pre- 
 vented from performing by defendant. 
 
 There was a total breach of the contract by defendant's refusal to 
 permit plaintiff to perform her part of it. Her right of action for 
 that breach was then complete, and it was tiot necessary for her to 
 appear at the Schools each day and demand opportunity to perform 
 the contract. She could not thereby make her cause of action any 
 more perfect than it was the moment she was informed that defend- 
 ant had refused to be bound by the contract. Her suit is not for dkni- 
 ages for a breach of the contract of employment, but is a suit for 
 wages claimed to be due Under the contract, for services which were 
 never actually performed. She seeks to treat the contract as .subsist- 
 ing until the end of the term, and broken only in respect of the prom- 
 ise to pay her the agreed monthly wages.- This she cannot do. Having 
 performed no services whatever, she cannot recover upon the prom- 
 ise, as if wages were earned. -iHer only right of action is for a breach 
 of the contract. ' It is insisted that she is entitled to recover on ac- 
 count of constructive service; that, being always ready and willing 
 to perf orm the contract, she should be regarded in law as having ac- 
 tually performed it. That doctrine was first announced by Lord El- 
 lenborough in Gandell v. Potigny, 4 Campbell, 375, a nisi prius case 
 
796 REPUDIATION (Ch, 4 
 
 decided in 1816, in which he held that a servant employed for a quar- 
 ter and wrongfully discharged before the end thereof might recover 
 upon an indebitatus assumpsit count for wages for the entire quarter. 
 
 Although that doctrine was followed in a few later cases, it has 
 long since been repudiated as unsound both in England and in a ma- 
 jority of the states of the Union. The Court of King's Bench in 1828 
 held that : "If the contract between master and servant be the usual 
 one for a year, determinable at a month, the servant, if turned away 
 improperly, cannot recover on a count stating the contract to be for 
 an entire year; and he cannot, on the common count for wages, re- 
 cover for Einy further period than that during which he had served." 
 Archard v. Hornor, 3 Car. 8z P. 349. See, also, Smith v. Hayward, 7 
 Ad. & E. 544, 112 Eng. Rep. 575; Goodman v. Pocock, 15 Q. B. 576. 
 
 In the case last cited plaintiff hired for a year, and was wrongfully 
 dismissed in the middle of a quarter. He brought an action for his 
 wrongful dismissal; the declaration containing a special count there- 
 for. The jury were instructed not to take into account the services 
 actually rendered during the broken quarter, as they were not recov- 
 erable except upon an indebitatus count, and they gave damages ac- 
 cordingly. He then brought a second action to recover on an indebita- 
 tus count for services rendered during the broken quarter, and the 
 court held that it could not be maintained. In his opinion, at page 
 580, Lord Campbell says: "He might then have rescinded the con- 
 tract, and have recovered pro rata on a quantum meruit. But he did 
 not do this; he sued on the special contract, and recovered damages 
 for a breach of it. By this course he treated the contract as subsist- 
 ing; and he recovered damages on that footing. It is said that he re- 
 covered in that action in respect of no services except those of the past 
 quarters. I receive with profound respect the opinion which the il- 
 lustrious judge who tried the former action is said to have expressed: 
 but I have a clear opinion, and I must act upon it, that the jury, in 
 assessing damages for the wrongful dismissal, ought to have taken 
 into the account the plaintiff's salary up to the time of his dismissal. 
 It is said there is now no plea to raise the point. The plea of non 
 assumpsit is quite sufficient. It obliges the plaintiff to show a debt 
 due ; and that could be only by showing that work was done for which 
 payment coutd be claimed under the common count." 
 
 Coleridge, J., in his opinion in the same case, says : "In a case like 
 this the servant may either treat the contract as rescinded and bring 
 indebitatus assumpsit, or he may sue on the contract, but he cannot 
 do both ; and, if he has two counts, he must take the verdict on one 
 only. Here the plaintiff elected to sue on the contract ; and he cannot 
 now sue in this form." 
 
 The following" English cases are to the same effect : Elderton 
 v. Emmens, 6 C. B. 160, 136 Eng. Rep. 1213, affirmed in House of 
 Lords, 13 C. B. 495, 138 Eng. Rep. 1292; and Beckham v. Drake, 2 
 House of Lords Cases, 579. 
 
Sec. 4) MEASURE OF DAMAGES — MITIGATION OP DAMAGES 797 
 
 The constructive service doctrine was followed for a while by the 
 courts of New York, but was later repudiated. The Court of Appeals 
 of that state, in Howard v. Daly, 61 N. Y. 362, 19 Am. Rep. 285, ex- 
 pressly disapproves the doctrine of Gandell v. Potigny, supra, and 
 overrules the earlier New York decisions. In that case plaintiff was 
 employed to act at the Fifth Avenue Theater, in such capacity and 
 manner as defendant might direct, and was to be paid a salary of $10 
 a week during the season, beginning about September 15, 1870, and 
 continuing until about July 1, 1871. There, as in this case, plaintiff was 
 prevented by the defendant from entering upon the discharge of her 
 engagement, and, in fact, never rendered any actual service. The 
 court held that she could not maintain an action for wages, ,but could 
 sue only' for breach of the contract, and that it was not necessary to 
 tender her services after the breach." * * * 
 
 The peculiar doctrine of successive liability for loss of wages, as if 
 upon a contract of continuing indemnity, announced by the Minnesota 
 court in McMuUan v. Dickinson, 60' Minn. 156, 62 N. W. 120, 27 L. 
 R. A. 409, 51 Am. St. Rep. 511, to be the proper rule, where a serv- 
 ant has been wrongfully discharged, we do not find to be followed by 
 any other court. Such a rule produces a multiplicity of suits for one 
 and the same wrong, and tends to encourage idleness in the discharg- 
 ed servant. Although wrongfully discharged, a servant still owes a 
 duty, both to himself and to society, to be diligent in trying to secure 
 other employment. A recovery once had, whether it be upon a count 
 for damages for a breach of the contract or upon an indebitatus as- 
 sumpsit count for services which could have been rendered, bars sub- 
 sequent recovery. For the breach of an entire contract the party ag- 
 grieved has a right to recover in the one action all damages, prospec- 
 tive as well as past. 2 Sedgwick (9th Ed.) § 636g; Willoughby v. 
 Thomas, 24 Grat. (Va.) 521 ; Lamoreaux v. Rolfe, 36 N. H. 33; Wil- 
 kinson V. Dunbar, 149 N. C. 20, 62 S. E. 748 ; Sutherland v. Wyer, 67 
 Me. 64; Litchenstein v. Brooks, 75 Tex. 196, 12 S. W. 975, and Mon- 
 arch Cycle Mfg. Co. v. Mueller, 83 111. App. 359. 
 
 That the contract in this case was entire needs no discussion. Plain- 
 tiff's declaration alleges that she was Employed for a period of nine 
 months — a school year. Having declared on the special contract for 
 wages which she claimed to be due thereunder, the .performance of the 
 services for which they were to be paid is put in issue by the general 
 plea, and the agreed facts prove that plaintiff actually performed no 
 services whatever, and therefore her suit must fail, unless her dec- 
 laratioh may properly be regarded as a suit for damages for the breach 
 
 ^3 The court here quoted from the New Tork opinion, and also discussed 
 Keedy v. Long, 71 Md. 385, 18 Atl. 704, 5 L. R. A. 759 (1889) ; Olmstead v. 
 Bach, 78 Md. 132, 27 Atl. 501, 22 L. E. A. 74, 44 Am. St. Rep. 273 (1893) ; 
 James v. Allen Co., 44 Ohio St. 226, 6 N. E. 246, 58 Am. Rep. 821 (1886) ; 
 and Carmean v. North American Transportation & Trading Co., 45 Wash. 446, 
 88 Pac. 834, 8 L. R. A. (N. S.) 595, 122 Am. St. Rep. 930, 13 Ann. Cas. 110 
 (19D7). 
 
798 REPUDIATION (Ch. 4 
 
 of the contract for her employment. This question we need not de- 
 termine, for the reason that, if it could be so regarded, her former re- 
 covery is a complete bar to the present action.''* 
 
 The judgment will be reversed, and, it beiiig apparent from the 
 agreed facts that plaintiff could not make out any better case if a new 
 trial should be awarded, judgment will be entered here for defend- 
 
 MELACHRINO v. NICKOLL & KNIGHT. 
 (In the King's Bench Division, [1919] 1 K. B. 693.) 
 
 Award in the form of a special case stated for the opinion of the 
 Court (pursuant to section 7, subsection [b], of the Arbitration Act, 
 1889), by a Board of Appeal of the Committee of Appeal of the In- 
 corporated Gil Seed Association. 
 
 Messrs. Melachrino and Kaniskeri, as sellers, made two contracts 
 with Messrs. Nickoll and Knight, as buyers, each dated November 
 24, 1916, and precisely similar in terms except as to price. 
 
 The form of the contracts used was the printed form of contract 
 issued by the Incorporated Oil Seed Association for adoption by per- 
 sons engaged in the oil-seed trade, in sales of cargoes of Egyptian cot- 
 ton seed with slight variations adopted by the parties. Each contract 
 was for the sale of .half a cargo of Egyptian cotton seed per steam- 
 ship Asaos, to be shipped by the above steamship from Alexandria 
 expected ready to load during December 1916. Payment to, be made 
 in London fourteen days from the seed being ready for delivery in 
 exchange for shipping documents and for delivery order. By clause 
 11 of the contracts it was provided that in default of fulfillment 
 of contracts by either party the other party should, after giving notice 
 in writing have the right of resale or repurchase as the case might be 
 and the defaulters should make good the loss if any on demand and that 
 in the event of the right of resale or repurchase not being exercised 
 the damages if any for which the party in default might be liable should 
 be settled by arbitration. On December 14, 1916, the sellers' repudiated 
 the contracts and wrongfully refused to deliver the cotton seed. On 
 
 ^*Two judges dissented, holding In a vigorous opinion (here omitted) that 
 tlie plaintiff could maintain several actions for damages, though not adopting 
 the constructive service doctrine. 
 
 ^5 There is a direct conflict as to whether several actions are maintainable 
 for breach of contracts of this kind. See, in accord : Doherty v. Schipper & 
 Block, 250 111. 128, 95 N. E. 74, 34 L. R. A. (N. S.) 557, Ann. Cas. 1912B, 364 
 (1911). Contra: Canada- Atlantic & Plant S. S. Co. v. Flanders, 165 Fed. 
 321, 91 C. C. A. 307 (1908). See Mechem & Gilbert, Cases on Damages, pp. 
 310-319. 
 
 In Ryan v. Mineral County High School Dist., 27 Colo. App. 63, 146 Pac. 792 
 (1915), the school board elected plaintiff as principal of the high school at a 
 salary of $1,200. It later repudiated this and offered him a position as princi- 
 pal of a grammar school at the same salary. He refused this. It was held 
 that he was entitled to nominal damages only. 
 
Sec. 4) MEASURE OP DAMAGES — MITIGATION OF DAMAGES 799 
 
 the same day the buyers acciepted the repudiation and there i was thus 
 an anticipatory breach. ■ 
 
 The arbitratoEs found that an average voyage from Alexandria to 
 the United Kingdom was at the time about three or four weeks ; that 
 the seed might have been expected to be deHvered at any time between 
 January 10 and February 10, 1917; that the market price was above 
 the contract price on December 14, 1916; that it began to fall on 
 December 18, and was below the contract price during the whole of 
 the period between January 10 and February 10, 1917. The buyers 
 did not give notice in writing under clause 11 to repurchase and did 
 not buy against the sellers but in accepting repudiation on December 
 14, 1916, claimed arbitration. 
 
 The sell«rs contended before the arbitrators that inasmuch as the 
 buyers did not buy against the contracts, the proper time for assessing 
 the measure of damages was the time at which the cotton seed ought to 
 have been delivered. 
 
 The buyers contended that the measure of damages should be as- 
 sessed at the time the sellers wrongfully refused to deliver the cotton 
 seed, narhely, on December 14, 1916. 
 
 In view bf their finding that the cotton seed might have been de- 
 livered at any time from about January 10, 1917, to about February 
 10, 1917, the arbitrators were of opinion that no precise time was or 
 could be fixed for delivery, and that, the measure of damages should 
 therefore be ascertained by the difference between the contract price 
 and the market price at the time of the refusal to deliver. But in order 
 to raise the question of law as to the proper time at which the damage 
 should be assessed they stated this case for the opinion of the Court. 
 
 If the Court should be of opinion that the measure of damages 
 should be assessed at the time at which delivery of the cotton seed 
 might reasonably have been expected they awarded that the buyers 
 were not entitled to recover any damages from the sellers oth^than 
 nominal damages which they assessed at one shilling. ™ 
 
 If the Court should be of opinion that the measure of damages 
 should be assessed at the time at which the sellers wrongfully re- 
 fused to deliver the cotton seed— ^namely, on December 14, 1916 — 
 they awarded that the sellers should each pay as damages to the 
 buyers 1562 1. 10 s. 
 
 The question for the opinion of the Court was whether the true 
 measure of damages was (as the arbitrators held) the difference be- 
 tween the contract price and the market price on December 14, the 
 date of the refusal to deliver, or the' diff ere,n9e at the time at which the 
 cotton sepd ought to have been delivered. 
 
 Dec. 10. The following judgment was read by 
 
 Bailhache, J. [who, after stating the facts, continued:] Upon 
 these facts the question arises: Are the buyers' damages to be 'fixed 
 with reference to the mai-ket prices on December 14, 1916, or with ref- 
 erence to the prices ruling at the time when the goods might be expect- 
 
800 REPUDIATION , (Ch. 4 
 
 ed to be delivered? If the former the damages are substantial, if the 
 latter nominal. The arbitrators have assessed the damages as at the 
 date of the anticipatory breach. 
 
 There was a market for the goods and in that case the prima facie 
 rules for the measurement of damages as laid down in s. 51 of the 
 Sale of Goods Act, 1893, vary according to whether there is a fixed 
 time for delivery or not. If there is no fixed time the measure is 
 the difference between the contract price and the market price at the 
 time of refusal to deliver. The first point to determine therefore is 
 whether this was a contract of that kind. In my opinion it was not. 
 The time was not certain but it was fixed by reference to the happen- 
 ing of an event — namely, the arrival of the Asaos in the United 
 Kingdom. I take it that when section 51 speaks of no time being fixed 
 for delivery it refers to those contracts in which no mention of time 
 is made and which therefore are to be performed within the indefinite 
 period known as a reasonable time tmde'r the circumstances. 
 
 In regard to other cases of which this is one the prima facie meas- 
 ure of damages is said to be the difference between the contract price 
 and the market price at the time the goods ought to have been de- 
 livered — in this case the period between January 10 and February 
 10, 1917. In a constantly fluctuating market and if the prices during 
 that period had ruled righer than the contract prices there might have 
 been some difficulty in determining the proper price to be taken, but in 
 this case that point does not arise, as at all times between those dates 
 the market prices were below the contract prices. 
 
 Section 51 does not in terms deal with an anticipatory breach, and 
 in the case of a breach by effluxion of time it is clear that it makes 
 no difference to the measure of damages whether a buyer goes into 
 the market or is content to take the difference in price without trou- 
 bling to buy against the defaulting seller. , The question to be decided 
 is wlMpher the same rule applies in the case of an anticipatory breach. 
 
 An apticipatory breach occurs when the seller refuses to deliver 
 before the contractual time "for delivery has arrived and the buyer 
 accepts his refusal as a breach of contract. 
 
 In that case the following rules are well established, subject of course 
 to any express provisions to the contrary in any particular contract. 
 
 Immediately upon the anticipatory breach the buyer may bring 
 his action whether he buys against the seller or not. 
 
 It is the duty of the buyer to go into the market and buy against 
 the defaulting seller if a reasonable opportunity offers. This is ex- 
 pressed by the phrase "It is the buyer's duty to mitigate damages." 
 In that event the damages are assessed with reference to the market 
 price on the date of the repurchase. If the buyer does not perform 
 his duty in this respect the seller is none the less entitled to have 
 damages assessed as at the date when a fresh contract might and ought 
 to have been made. 
 
Sec. 4) MEASURE OF DAMAGBS^-MITIGATION OF DAMAGES 801 
 
 As a corollary to this rule the buyer imay if he pleases go iiito the 
 market and buy against the seller : as he is bound to do so to mitigate 
 damages, so he is ehtitled to do so to cover himself against his com- 
 mitments or to secure the goods. In that case again the damages 
 are assessed with reference to the market price at the date of the 
 repurchase. 
 
 It is also settled law that when default is made by the seller by 
 refusal to deliver within the contract time tlie bilyer is under no duty 
 to accept the repudiation and buy against him but may claim the differ- 
 ence between the contract price and the market price at the date when 
 under the contract the goods should have' been delivered. 
 
 Further, in the case of an ' anticipatory breach the contract is af 
 an end and the defaulting seller cannot take advantage of any subse- 
 quent circumstances which would have afforded him a justification for 
 nonperformance of his contract had his repudiation not been accepted. 
 
 In logical strictness it would appear to follow that equally the 
 defaulting seller cannot take advantage of a fall in the market before 
 the due date for delivery to escape liability for damages. 
 
 It looks therefore at first sight as though the date at which the dif- 
 ference between the contract price and the market price ought to be 
 taken for the assessment of damages when the buyer does not buy 
 against the seller should follow by analogy the rule adopted where 
 the buyer goes into the marlcet and buys, or where the breach is fail- 
 ure to deliver at the due date and should be at or about the date when 
 the buyer intimates his acceptance of the repudiation though he does not 
 actually go into the market against the seller. If so, in this case, the 
 date would be about December 14, when the buyer claimed arbitration 
 and so the arbitrators have found. 
 
 As against this line of reasoning it must be remembered that the 
 object of damages is to place a person whose contract is broken in as 
 nearly as possible the same position as if it had been perfbrmed. This 
 result is secured by measuring^ damages either at the date of the 
 repurchase, in the case of repurchase on an anticipatory breach, or 
 at the date when the goods ought to have been delivered when there 
 is no anticipatory breach whether therfe is a repurchase or not. In 
 these cases the buyer gets a new contract as nearly as may be like 
 the broken contract and the defaulting seller pays the extra expense 
 incurred by the buyer in restoring his position. 
 
 Where however there is an anticipatory breach but no buying 
 against the defaulting seller, and the price falls below the contract 
 price between the date of the anticipatory breach and the date' when the 
 goods ought to have been delivered, the adoption of the date of the 
 anticipator/ breach as the date at which the market price ought to be 
 taken would put the buyer in a better position than if his contract had 
 been duly performed. He would if that date were adopted be given 
 a profit and retain his money wherewith to buy the goods if so minded 
 
 OOKBIN CONT 51 
 
802 REPUDIATION (Ch. 4 
 
 on the fall of the market. It would be in effect, to use a homely 
 phrase, to allow him to eat his cake and have it. Perhaps ii is better 
 to avoid figures of speech however picturesque and to say, to make a 
 profit from the anticipatory breach while the contract if duly performed 
 would have shown a loss — a position which is I think irreconcilable 
 with the principles upon which damages are awarded as between 
 buyer and seller. 
 
 In my opinion the true rule is that where there is an anticipatory 
 breach by a seller to deliver goods for which v there is a market at a 
 fixed date the buyer without buying against the seller may bring his 
 action at once, but that if he does so his damages must be assessed 
 with reference to the market price of the goods at the time when they 
 ought to have been delivered under the contract. If the action comes 
 to trial before the contractual date for delivery has arrived the Court 
 must arrive at that price as best it can. 
 
 To this rule there is one exception for the benefit of the defaulting 
 seller — namely, that if he can show that the buyer acted unreasonably, 
 in not buying against him the date to be taken is the date at which 
 the buyer ought to have gone into the market to mitigate damages. 
 
 I have discussed the position on principle apart from authority 
 because, in my limited experience, I do not remember a case precisely 
 like this. 
 
 I might perhaps have contented myself with basing my judgment up- 
 on the authority of Roper v. Johnson, L. R. 8 C. P. 167, and I should 
 have done so but for the fact that I am not sure that when that case 
 was decided one year after Brown v. MuUer, L. R. 7 Ex. 319, the 
 distinction between an accepted and unaccepted repudiation was as 
 well established as it has since become. There are some observations 
 in the judgments in that case which would not, I venture to think, 
 now be supported, and the case turned largejly on where the burden of 
 proof lay. Subject however to these criticisms Roper v. Johnson, 
 L. R. 8 C. P. 167, seems to me to support the conclusion at which I 
 have arrived. 
 
 The result in this case is that the damages are nominal.''* 
 
 "In Kadish v. Tonng, 108 111. 170, 43 Am. Rep. 548 (1883), it was held 
 that, where the seller did not accept the buyer's anticipatory repudiation as 
 final, the contract remained as before and the seller's rjght to damages was, 
 not limited by the market price at the date of repudiation. The seller was 
 held to be safe in waiting and tendering performance as agreed, without mak- 
 ing another forward contract for the sale of a similar quantity. It may be 
 questioned whether the injured party should ever be required to make a risky 
 "forward contract," speculative in character, in order to mitigate loss. Sup- 
 pose it increases the loss ! Stephen M. "Weld & Co. v. Victory Mfg. Co. (D. 
 C.) 205 Fed. 770 (1913). See Beale, Damages upon Repudiation, 17 Yale L. 
 Jour. 443 ; also Comment, 17 Tale L. Jour. 611 ; Williston, Sales, § 589. 
 
Sec. 4) MEASUBE OP DAMAGES— MITIGATION OF DAMAGES 803 
 
 PAYZU, Limited, v. SAUNDERS. 
 (In the Court of Appeal. [1919] 2 K. B. 581.) 
 
 The defeadant contracted to deliver certain installments of silk to 
 the plaintiff, eacH installment to be paid for within thirty days, with a 
 specified discount. The first installment was delivered, but the check 
 sent in payment therefor was never received, and actual payment was 
 thus greatly delayed. The defendant erroneously believed that the de- 
 lay was caused by the buyer's inability to pay, and therefore refused to 
 deliver any more silk, except on payment of cash. The plaintiff re- 
 fused to pay cash and sued for breach. 
 
 The court held that under the Sale of Goods Act mere nonpayment 
 not accompanied by repudiation did not justify the refusal of the de- 
 fendant to deliver. The plaintiff appealed on the question of damages.''^ 
 
 Bankes, L,. J. At the trial of this case the defendant, the present 
 respondent, raised two points: First, that she had committed no 
 breach of the contract of sale, and secondly that, if there was a breach, 
 yet she had offered and was always ready and willing to supply the 
 pieces of silk, the subject of the contract, at the contract price for cash ; 
 that it was unreasonable on the part of the appellants not to accept 
 that offer, and that therefore they cannot claim damages beyond what 
 they would have lost by paying cash with each order instead of having 
 a month's credit and a discount of 2% per cent. We must take it that 
 this was the offer made by the respondent. The case was fought and 
 the learned judge has given judgment upon that footing. It is true 
 that the correspondence suggests that the respondent was at one time 
 claiming an increased price. But in this Court it must be taken that 
 the offer was to supply the contract goods at the contract price except 
 that payment was to be by cash instead of being on credit. 
 
 In these circumstances the only question is whether the appellants 
 can establish that as matter of law they were not bound to consider 
 any offer made by the respondent because of the attitude she had taken 
 up. Upon this point McCardie, J., referred to British Westinghouse 
 Electric & Manufacturing Co. v. Underground Electric Railways Co. 
 of London, [1912] A. C. 673, 689, where Lord Haldane, L. C, said: 
 "The fundamental basis is thus compensation for pecuniary loss 
 naturally flowing from the breach ; but this first principle is qualified 
 by a second, which imposes on a plaintiff the duty of taking all reason- 
 able steps to mitigate the loss consequent on the breach, and debars him 
 from claiming any part of the damage which is due to his neglect to 
 take such steps. In the words of James, L. J., in Dunkirk Colliery Co. 
 V. Lever (1878) 9 Ch. D. 20, 25 : 'What the plaintiffs are entitled to 
 is the full amount of the damage which they have really sustained by 
 
 ^7 The statement of facts has been rewritten and the opinion of McCardie, 
 J., in the Court of King's Bench, is omitted. 
 
804 ' REPUDIATION < .:; (Ch. 4 
 
 a breach of the contract. The person who has broken the contract not 
 being exposed to additional cost by reason of the plaintiffs not doing 
 what they ought to have dona as reasonable men, and, the plaintiffs 
 not being under any obligation to do anything otherwise than in the 
 ordinary course of business.' " It is plain that the question what is 
 reasonable for a person to do in mitigation of his damages cannot be 
 a question of law but must be one of fact in the circumstances of each 
 particular case. There may be cases where as matter of fact it would 
 be unreasonable to expect a plaintiff to consider any offer made in view 
 of the treatment he has received from the defendant. If he had been 
 rendering f)ersonal services and had been dismissed after being ac- 
 cused in presence of others of being a thief, and if after that his em- 
 ployer had offered to take him back into his service, most persons 
 would think he was justified in refusing the offer, and that it would be 
 unreasonable to ask him in this way to mitigate the damages in an 
 action of wrongful dismissal. But that is not to state a principle of 
 law, but a conclusion of fact to be arrived at on a consideration of all 
 the circumstances of the case. Mr. Matthews complained that the 
 respondent had treated his clients so badly that it would be unreason- 
 able to expect them to listen to any proposition she might make. I do 
 not agree. In my view each party was ready to accuse the other of 
 conduct unworthy of a high commercial reputation, and there was 
 nothing to justify the appellants in refusing to consider the respondent's 
 offer. I think the learned judge came to a proper conclusion on the 
 facts, and that the appeal must be dismissed. 
 
 ScRUTToN, I,. J. I am of the same opinion. ■ Whether it be more 
 correct to say that a plaintiff must minimize his damages, or to say 
 that he can recover no more than he would have suffered if he had acted 
 reasonably, because any further damages do not reasonably follow from 
 the defendant's breach, the result is the same.* The- plaintiff must 
 take "all reasonable steps to mitigate the loss consequent on the breach," 
 and this principle "debars him from claiming any part of the damage 
 which is due to his neglect to take sych steps" : British Westinghouse 
 Electric & Manufacturing Co. v. Underground Electric Railways Co. of 
 London, per Lord Haldane, L. C, [1912] A. C. 673, 689. Mr. Mat- 
 thews has contended that in considering what steps should be taken to 
 mitigate the damage all contractual relations with the party in default 
 must be excluded. That is contrary to my experience. In certain cases 
 of personal service it may be unreasonable to expect a plaintiff to con- 
 sider an offer from the other party who has grossly injured him ; but 
 in commercial contracts it is generally reasonable to accept an offer 
 from the party in default. However, it is always a question of fact. 
 About the law there is no difficulty. 
 
 Appeal dismissed. 
 
 *See opinion of Judge Burch ia Rock v. Vandine, ante, p. 794, note, 72. See, 
 also, Byan v. Mineral County High School Dist., ante, p. 798, note 75. 
 
Sec. 4) MEASUEE OP DAMAGES— MITIGATION OF DAMAGES S05 
 
 HOIvLERBACH & MAY CONTRACT CO. v. WILKINS. 
 (Court of Appeals of Kentucky, 1908. 130 Ky. 51, 112 S. W. 1126.) 
 
 Action by J. Arch Wilkins against the Hollerbach & May Contract 
 Company. Judgment for plaintiff, and defendant appeals. Affirmed. 
 
 Barker, J.'* This is an action for the breach of an alleged contract 
 between appellee and appellant for the sale and delivery by the former 
 to the latter of 4,000 cubic yards of broken rock to be used in con- 
 structing lock and dam No. 6 in Green river. Appellee alleged in his 
 petition that appellant, a corporation, had secured the contract from the 
 United States government to construct the lock and dam in question, 
 and that in the construction of this work is needed about 4,000 cubic 
 yards of broken stone of dimensions not less than one-half cubic foot 
 nor larger than what a man could handle ; that he entered into a con- 
 tract with appellant by which he undertook to furnish it with the stone, 
 and it agreed to pay him therefor 60 cents per cubic yard delivered on 
 barges in Green river; that, after making this contract with him, the 
 appellant willfully and arbitrarily broke it, and refused to permit him 
 to go on with it. The damages were laid in the petition at $1,250, and 
 were said therein to consist of $250 expended in opening up the quarry 
 in order to get out the stone, and $1,000 which the appellee could have 
 made in profit had he been allowed to execute his contract as made with 
 appellant. The appellant in its answer denied the existence of the con- 
 tract, and this was the real issue between the parties, although there are 
 several questions discussed in the briefs. A trial of the case resulted 
 in a verdict in favor of appellee for $500 and from the judgment based 
 upon that'verdict this appeal is prosecuted. * * * 
 
 The court did not err in not instructing* the jury that it was the 
 duty of the appellee, even if there was a breach of the contract, to use 
 reasonable diligence to sell the stone contracted for to other parties. 
 The principle for which counsel for appellant contend has no applica- 
 tion to a contract like the one under discussion. It is true, where 
 there is a contract for' personal services, and there, is a breach, the 
 party whose services are to be engaged may not sit down and su- 
 pinely permit the amount of his damages to grow. It is his duty 
 to seek employment elsewhere, and the other party is only liable 
 to the extent of the injury after the exercise of ordinary diligence 
 by the complainant to obtain other employment still leaves him 
 a .sufferer by reason of the breach. In the case in hand the appel- 
 lee had a rock quarry, and, although it might be true that he could 
 have sold 4,000 cubic yards of rock to another party, that would not 
 have diminished his damages in not being allowed to carry out his con- 
 tract with appellant, because he was entitled, if, he could, to sell all the 
 rock in his quarry; and it in no wise minimized the damages he may 
 
 ''Part of the opinion is omitted. 
 
806 EBPUDIATION (Ch. 4 
 
 have sustained by the breach of appellant's contract that he might, per- 
 chance, have sold 4,000 yards of broken rock to some one else. This 
 is quite, different from a contract for personal services. There the con- 
 tract cannot be performed for two different parties, and, when the em- 
 ployer refuses to carry out his contract for the personal services of the 
 servant, the latter must look for another employer, and thus reduce 
 the damages, arising from the breach, as rhuch as possible. 
 
 We do not mean to be understood as limiting the application of the 
 principle of avoidance of damages to breaches of contracts for personal 
 service ; on the contrary, the rule is of much broader application, and 
 it would, perhaps, not be going too far to say that the duty of those 
 complaining of violations of contracts to minimize their damages as 
 much as the exercise of reasonable diligence will accomplish is the gen- 
 eral rule appertaining to the right to recover damages therefor. The 
 complainant should reduce his damages whenever the principle can be 
 applied without sacrificing any substantial right. A fair illustration of 
 the general application of the rule may be found in the supposition that 
 the breach of the contract under discussion had been by appellee's 
 refusing to deliver to appellant the stone contracted for. It would in 
 the supposed case have been the duty of appellant to go out into the 
 market and buy the stone, and it could only hold appellee liable for the 
 difference between the contract price and what it had to pay for the 
 stone on the market. This, from the very nature of the case, would 
 cover all the damage it sustained by the breach of the contract. But 
 the same principle is not applicable to the breach of contract complained 
 of in this record. Appellee was entitled to enjoy the benefit of the 
 profits of his contract with appellant, and, if he could have made as 
 beneficial a contract with another, he was entitled to the benefits of 
 that also. In other words, he was entitled to carry forward as many 
 such contracts as he could make, and, if he succeeded in making more 
 than one, he was entitled to both profits. Receiving the profits of one 
 such contract would not tend to recoup his loss by reason of the breach 
 of another. Sedgwick on Damages (8th Ed.) § 608. It was not nec- 
 essary for the appellee to expressly offer to go on with the contract aft- 
 er the breach. He was informed by the appellant that it had contract- 
 ed for the stone from another p^rty, and it was therefore useless for 
 him to make a formal tender of the stone to it. The law does not re- 
 quire the doing of a useless act. 
 
 Upon the whole case no substantial error was committed against ap- 
 pellant, and the judgment is therefore affirmed.''* 
 
 '« See, also, Eayburn v. Comstock, 80 Mich. 448, 45 N. W. 378 (1890). In 
 Cockburn v. Trusts & G. Co., 38 Out. L. R. 396, 33 D. L. B. 159 (1917), it 
 was Held that an employee must deduct profits made in a business that he 
 could not have carried on but for the discharge. 
 
Sec. 5) 
 
 PEEVENTION OF PEKFOKMANCE 807 
 
 SECTION 5.— PREVENTION OF PERFORMANCE AND 
 WAIVER OF CONDITIONS 
 
 (a) Prevention of Performance 
 
 (Including Prevention, by the Plaintiff, of Performance by the De- 
 fendant, and Prevention, by the Defendant, of the Ful- 
 fillment of Conditions by the Plaintiff) 
 
 ANONYMOUS. 
 
 (13 Hen. VII, Keilway, 34, pi. 2.) 
 
 In an action of covenant upon a deed, to the effect that the defendant 
 had covenanted for the collection of rents in a certain town, and had 
 not performed, so that action lay against him. To this the defendant 
 replied that he was prevented by the plaintiff himself from collecting 
 the rents. The plaintiff moved for judgment that the plea was not 
 good; because if the facts were as alleged, the defendant would have 
 a good action of trespass against the plaintiff and could recover dam- 
 ages, and so he has no defense in this action. The Court replied that 
 the plea was good,^" to avoid circuity of action, for if the defendant 
 should briiig trespass and get damages, then the plaintiff could recover 
 in a writ of covenant against the defendant, a circuity of action which 
 the law will not suffer. 
 
 80 In accord: Anon. 2 EoUe, Rep. 238 fl622), semble; United States v. 
 Peck, 102 U. S. 64, 26 L. Ed. 46 (1880) ; Ferber v. Cona, 89 N. T. Law, 135, 
 97 Atl. 720 (1916) ; Village of Argyle v. Plunkett, 175 App. Div. 751, 162 
 N. X. Supp. 242 (1916) ; Famous Players Film Co. of New England v. Salo- 
 mon (N. H.) 106 Atl. 282 (1918). 
 
 In Porto Kico v.. Title Guaranty & Surety Co., 227 U. S. 382, 389, 33 Sup. Ot. 
 362, 57 L. Ed. 561 (1913), Mr. Justice Holmes said: "If, within the time al- 
 lowed for performance the plaintiff made performance impossible, it is un- 
 imaginable that any civilized system of law would allow it to recover upon 
 the bond for a failure to i>erform. 2 Bl. Comm. 340, 341 ; U. S. v. Arredondo, 
 6 Pet. 691, 745, 746, 8 L. Ed. 547 (1832)." 
 
 Where delay in construction is caused by the default of the owner, a provi- 
 sion for liquidated damages for delay cannot be enforced ; but it may be made 
 a condition precedent to the contractor's privilege of not paying damages 
 that he shall make his claim 'that the owner has caused the delay in writing 
 and within a fixed period : Wait v. Stanton, 104 Ark. 9, 147 S. W. 446 (1912) ; 
 Chapman Decorative Co. v. Security Mut. Life Ins. Co., 79 C. C. A. 137, 149 
 Fed. 189 (1906) ; Equitable Real Estate Co. v. National Surety Co., 133 La. 
 448, 63 South. 104 (1913) ; Cramp & Co. v. Boyertown Burial Casket Co., 241 
 Pa. 15, 88 Atl. 69 (1913), notice was here given. This condition of notice can 
 be waived. Jobst v. Hayden Bros.,. 84 Neb. 735, 121 N. W. 957, 50 L. R. A. (N. 
 S.) 501 (1909) ; Walsh v. North American Cold Storage Co., 260 111. 322, 103 
 N. E. 185 (1913). 
 
808 OEEKATION OF CONTRACT (Ch, 4 
 
 BLANDFORD v. ANDREWS. 
 (In the Queen's Bench, 1599. Oro. Eliz. 694.) 
 
 Debt on an obligation of £80, conditioned, that if the defendant pro- 
 cured a marriage to be had between the plaintiff and one Bridget 
 Palmer, at or before the Feast of St. Bartholomew then next following; 
 that then, &c. The defendant pleaded, that the plaintiflf, before that 
 feast, came to the said Bridget Palmer, and called her, whore; and 
 told her, that if he married her, he would tie her to a post; and used 
 other opprobrious words unto her; by reason whereof the defendant 
 could not procure the said marriage before the said feast. Where- 
 upon the plaintiff depiurred. — Williams, Serjeant, moved that this was 
 not any plea ; for he hath not shewn that he used his endeavour to pro- 
 cure the marriage; for it may be that, notwithstanding these words, 
 they would have intermarried. — And of that opinion was all THE 
 Court; for the defendant ought to shew that there was not any de- 
 fault in him, and that he did as much as in him lay to procure it; other- 
 wise he doth not save his obligation: and these words spoken before 
 the day, at one time only, are not such an impediment but that the mar- 
 riage might have taken effect. Wherefore it was adjudged for the 
 plaintiff. 
 
 BRACKETT V, KNOWLTON. 
 (Supreme Judicial Court of Maine, 1912. 109 Me. 43, 82 AtL 436.) 
 
 Action by James W. Brackett against Sarah A. Knowlton. On re- 
 port. Judgment for plaintiff. 
 
 Assumpsit to recover the sum of $453.95. Plea, the general issue. 
 An agreed statement of facts was filed, and the case ireported to the 
 law court for determination. 
 
 Mr. Justice BIRD, who prepared the opinion, states the case as fol- 
 lows : 
 
 The defendant's testator, Jeremiah B. Knowlton, was the owner of 
 certain springs, and prior to the date of the contract set forth below 
 had advertised them as for sale in certain newspapers owned or con- 
 trolled by plaintiff. On the day of its date the plaintiff and the testator 
 executed the following agreement : 
 
 "Phillips, Maine, Nov. 5, 1900. 
 
 "Memorandum of advertising contract between J. B. Knowlton, of 
 Strong, Maine, and the Phillips Phonograph and Maine Woods, Phil- 
 lips, Maine, for advertising said Knowlton's soda and sulphur springs 
 to such an amount as in the judgment of J. W. Brackett seems best, 
 but not to exceed the sum- of ($1,000) one thousand dollars a year for 
 two years' time under this agreement,, the regular price for said 
 
Sec. 5) PREVENTION OF PERFORMANCE 809 
 
 advertising to be. paid when said springs are sold, or upon sale of one 
 of them. If the property named herein is sold within two years, the 
 ambunt to be paid by said Knowlton is simply the amount that will 
 have been earned by the advertising up to that time. It is also agreed 
 that J. W. Brackett's bill of ($317:83) three hundred and seventeen 
 dollars and eighty-three cents, for advertising said springs previous to 
 this date, is also to be paid when said springs, or either of them, is 
 sold. 
 
 "There shall be no demand made for advertising until said springs, 
 or one of them> are sold or in some way change owners. This is to be 
 interpreted to mean that the heirs, in case of said Knowlton's death, 
 shall be no more liable than he, unless there is business sufificient to 
 pay it as managed by said heirs. J. W. Brackett. [Seal.] 
 
 "J. B.. Knowlton. [Seal.] 
 
 "Witness : W. D. Grant." 
 
 The plaintiff, in accordance with the contract, continued to adver- 
 tise the springs in the years 1901 and 1902. 
 
 On the 18th of April, 1906, the testator conveyed the springs, de- 
 scribed in the contract, as a gift to his grandchildren, who were the 
 testator's legal heirs. The testator died on the 12th day of March, 
 1907. By his will, he left all his estatfe to his widow, the executrix. 
 Since the Conveyance to them, his grandchildren have neither sold 
 nor leased the springs, nor received any income therefrom. The 
 plaintiff claims that his charges for advertising are due, and brings 
 this action to recover the same. 
 
 Bird, J. The items for which this suit is brought are of two classes, 
 one for advertising before the making of the contract between plaiiitiff 
 and defendant's testator, and the other for advertising done subse- 
 quent to and under the terms of the contract. The former con- 
 stituted an absolute debt, payment of which was to be contingent 
 upon the happening of a future event, while the latter was to become 
 an obligation of the testator, or his heirs, upon the occurrence of the 
 same event. Whether the items of the first class were done within a 
 reasonable time after the services performed it is unnecessary to de- 
 termine. See Sears v. Wright, 24 Me. 278, 280 ; De Wolfe v. French, 
 51 Me. 420. By the terms of the contract the items of both classes 
 were to be payable "when said springs, or either of them, is sold." 
 The happening of this event is explained or modified by the second 
 paragraph of the contract, which we interpret to mean that payment 
 of the sums properly chargeable for advertising ghall not be enforce- 
 able until one, at least, of the springs is sold by the testator, or in the 
 event of his death, until his heirs shall either sell One of the springs, 
 or, under their management, there is sufficient business to pay them. 
 By the conveyance to his grandchildren by way of gift, the testator 
 ma,de impossible the occurrence of either of the contingencies, and his 
 liability at once accrued. Crooker v. Holmes, 65 Me. 195, 199, 20 Am. 
 
810 OPERATION OF CONTEACT (Ch. 4 
 
 Rep. 687; Wright v. Haskell, 45 Me. 489; Poland v. Brick Co., 100 
 Me. 133, 135, 60 Atl. 795. 
 
 Judgment for plaintiff for the sum of $453.95, with interest from 
 the date of the writ.'* 
 
 CLARK V. HOVEY. 
 
 (.Supreme Judicial Court of Massachusetts, 1914. 217 Mass. 485, 105 N. 
 
 E. 222.) 
 
 Action by Ewen A. Clark against Freeland E. Hovey. Verdict for 
 plaintiff, and defendant excepts. Judgment for defendant. 
 
 RuGG, C. J. This is an action to recover for services as a real estate 
 broker. The plaintiff was employed by the defendant to sell certain 
 real estate, and he procured a purchaser who executed a contract for 
 sale of it with the defendant. Simultaneously with this contract the 
 following agreement was -entered into between the plaintiff and the 
 defendant : 
 
 "It is agreed by and between Ewen A. Clark, broker, and Freeland 
 E. Hov^y, owner, that concerning the agreement for sale of property 
 #2 and #6 Cambridge street, Boston, from Hovey to Jeremiah, Green, 
 for the sum of $60,000, that said Clark agrees to accept the sum of 
 $500 in full payment of commission and for his full compensation in 
 the matter, and said Hovey agrees to pay said sum. 
 
 "It is further agreed by both parties that this $500 shall not be paid 
 from' the first $5,000 paid Hovey, of which $500 has been paid to-day, 
 but shall be paid by Hovey to Clark from the first $500 received by 
 Hovey from Green after the $5,000 has been paid. In other words, 
 Clark will not make any claim for commission unless Hovey receives 
 more than $5,000 in cash from the sale." 
 
 The contract for sale was never carried out because the defendant 
 could not give a good title by reason of certain restrictions. The 
 question is whether, under these circumstances, the plaintiff ife entitled 
 to his commission. 
 
 The rights of the parties depend upon the terms of their agreement, 
 which is in writing and not ambiguous. It fixes the price which the 
 plaintiff was to receive. It stipulates in unequivocal words that the 
 
 SI In accord: Camden v. Jarrett, 83 C. C. A. 492, 154 Fed. 788 (1907), 
 defendant promised to pay after getting a judgment, and then compromised 
 the suit ; Pneumatic Signal Co. v. Texas & P. R. Co., 200 N. Y. 125, 93 N. B. 
 471 (1910), express condition of approval by Railway Commission prevented 
 by the defendant's failure to obey orders of the Commission ; Schauffelee v. 
 Greenberg, 83 N. J. Law, 737, 85 Atl. 178 (1912) ; Suter v. Farmers' Fertilizer 
 Co., 100 Ohio St. 403, 126 N. E. 304 (1919), broker's commission payable after 
 receipt of price, seller and buyer then rescind the sale. 
 
 Where the condition precedent to the plaintiff's enforceable right is some 
 voluntary act of the defendant, such as a certificate of approval by him, the 
 condition is nullified if the defendant refuses to investigate and decide. Hpt- 
 ham V. East India Co:, 1 T. R. 638 (1787); Argus Co. v. Breslin, 107 Misc. 
 Hep. 40, 175 N. T. Supp. 853 (1919). 
 
Sec. 5) PEEVENTION OP PERFORMANCE 811 
 
 compensation shall not be paid by the defendant until after he has 
 received $5,000 on account of the sale. As matter of construction, 
 this means that it is a condition to his being able to recover any com- 
 mission that the defendant shall have received $5,000 in cash from 
 the sale. Its effect is not, as in some of the cases relied on by the 
 plaintiff, to fix a tim.e beyond which the broker shall not be called 
 upon to wait for his pay, but it establishes a moment before the- arrival 
 of which he cannot ask for his compensation. There is nothing in 
 the record to indicate that the employer of the broker has failed 
 through any volition of his own to carry out the contract. 
 
 The written agreement between the parties supersedes the ordinary 
 rule that the broker has earned his commission when he has procured 
 the execution of a valid agreement for sale. It follows that the judg- 
 ment of the lower court was wrong. In accordance with St. 1913, c. 
 716, § 2, the entry may be : 
 
 Judgment for the defendant. 
 
 FAY v. MOORE. 
 
 (Supreme Court of Pennsylvania, 1918. 261 Pa. 437, 104 Atl. 686.) 
 
 Action by Ella M. Fay, administratrix of the estate of Edward Fay, 
 against James S. Moore. Judgment for plaintiff, and defendant ap- 
 peals. Affirmed. 
 
 Frazer, j.*^ Plaintiff, a contractor, sues to recover from the owner 
 a balance alleged to be due under a contract for the erection of a 
 building. The defense is that plaintiff failed to complete the work in 
 accordance with the specifications, whereby defendant was obliged to 
 take possession of the building and finish it at an expense beyond the 
 contract price. Plaintiff having died while the action was pending, 
 his wife was substituted on the record as administratrix of his estate. 
 The case has been tried three times the result of the last trial being a 
 verdict and judgment for plaintiff from which defendant appealed. 
 
 The first two assignnients of error are to the refusal of the court 
 below to give binding instructions and subsequently to enter judg- 
 ment for defendant non obstante veredicto. The contract required 
 payments to be made only upon the certificate of the architect. When 
 the building was practically completed, ^nd a certificate for final pay- 
 ment requested, the architect notified plaintiff in writing that the work 
 was not perfornied in accordance with the contract in certain specified 
 particulars. Plaintiff contends the defects enumerated by the archi- 
 tect were rectified by him, while defendant avers such was not the 
 case, but, on the contrary, he was obliged to employ another contrac- 
 tor to complete the work. 
 
 The first objection is that corner beading was omitted. The speci- 
 
 82 Part of the opinion is , omitted. 
 
812 OPERATION OF OONTBACT (Ch, 4 
 
 fications call, for "wood corner beads on all exposed angles," but 
 failed to set forth the particular kind of beading to be used. Plain- 
 tiff's son, who had charge of the construction, work, testified beads 
 were put on at exposed corners, and this does not seem to be, denied; 
 the contention being a different style of beading should, have been sup- 
 plied, as appears in a subsequent letter from the architect, in which 
 he states the owner "has instructed me to put on beads in accordance 
 with his desire, although I have never seen that kind of bead which 
 he desires, at the same time he states that nothing else [will] be ac- 
 cepted by him; so there is no other alternative, and therefore I am 
 compelled to instruct you to make them different from what I would 
 personally select." 
 
 In another letter, written a few days later, the architect says: "I 
 am perfectly aware that the bead Mr. Moore desires is impractical, 
 as well as impossible ; but as Mr. Moore gave me no other alternative 
 in the matter, and the best I could do was to give his instructions ver- 
 batim to you." 
 
 And in a third letter says he had again taken the matter up with 
 the owner "and asked him to give me instructions for the regular old- 
 fashioned wood corner bead put on, which is the only thing that can 
 be accomplished outside of the covered bead, which you have at pres- 
 ent, and v/hich Mr. Moore does not want." 
 
 . Under these circumstances the jury were warranted in finding the 
 architect, in condemning the bead used by plaintiff, was not acting up- 
 on his own impartial judgment as to the sufficiency of the work, but 
 at the dictation and to satisfy the whim of the owner. 
 
 Another objection is the window sashes were of chestnut instead of 
 white pine lumber, as called for in the contract. With respect to this 
 item, the testimony on behalf of plaintiff is to the effect the architect 
 instructed him to use chestnut instead of pine, so as to conform to the 
 interior finish of the house. The owner visited the work almost daily, 
 and with the architect made up lists of matters to be attended to or 
 corrected, among which appears a memorandum to the effect that the 
 owner would consider the matter of using chestnut instead of white 
 pine sash. While it is true the contract provides that no alterations 
 should be made, except on the written order of the architectj the par- 
 ties had the right to waive the provision. Raff v. Isman, 235 Pa. 347, 
 84 Atl. 352. And this the verdict indicates they did. Furthermore, 
 th^re is no attempt in this case to charge for extra work. 
 
 As to the various items of which complaint is made, the testimony 
 on behalf of plaintiff is to the effect that portions of the work, the de- 
 tails of which were not mentioned in the specifications, were done un- 
 der the direction of the architect, and that other variations and defects 
 were remedied after complaint was received. The architect having 
 persisted in refusing a certificate of completion, giving as an excuse 
 for his action the owner's dissatisfaction with the work, and the con- 
 tractor continuing to claim a completion of the contract, the owner pro- 
 
Sec. 5) PREVENTION OF PERFORMANCE 813 
 
 cured a bid and entered into a contract for the additional work on the 
 house he deemed necessary to complete the contract according to spec- 
 ifications, paying therefor the sum of $819, and for other items the 
 sum of $220, which amounts were deducted from the contract price, 
 and the architect signed a certificate to the effect that, after deducting 
 such items, a balance of $1,100 remained due the contractor. 
 
 While the testimony on behalf of plaintiff was contradicted by the 
 architect and other witnesses for defendant, the case was necessarily 
 for the jury, to whom it was submitted by the trial judge with instruc- 
 tions to consider the decision of the architect conclusive, unless they 
 found from the circumstances in the case his decision was the result 
 of collusion with the owner, and not a fair and impartial one. The 
 court also^left to the jury to say whether the contractor faithfully, 
 honestly, and substantially complied with the provisions of his con- 
 tract, and further charged, if they so found, and minor defects or de- 
 ficiencies existed, such defects would not prevent a recovery for the 
 amount due vmder the contract, less a reasonable allowance for the 
 cost of remedying the imperfections. 
 
 The provision in the contract requiring the production of the certifi- 
 cate of the architect, showing completion of the work, is intended as a 
 protection to the owner against unjust claims by the contractor and to 
 see that the latter properly carries out his agreement, and in cases 
 where the evidence establishes refusal of the architect to be capricious, 
 fraudulent, or based on collusion with the owner, his withholding the 
 certificate will not prevent the contractor from recovering the amount 
 due him. Pittsburg, etc., Lumber Co. v. Sharp, 190 Pa. 256, 42 Atl. 
 685. There also being evidence in the case to support the conclusion 
 of the jury of there being no willful or intentional departure from 
 the terms of the contract, the doctrine of substantial performance was 
 appUcable, and was properly stated by the trial judge in accordance 
 with the principles laid down in Morgan v. Gamble, 230 Pa. 165, 79 
 Atl. 410. * * * 
 
 The assignments of error are overruled, and the judgment af- 
 firmed.*^ 
 
 UNITED STATES v. UNITED ENGINEERING & CONSTRUCT- 
 ING CO. 
 
 (Suoreme Court of the United States, 1914. 234 U. S. 236, 34 Sup. Ct. 843, 
 
 58 L. Ed. 1294.) 
 
 Appeal from the Court of Claims to review a judgment against the 
 United States in a suit upon a contract for public work. Affirmed. 
 
 Mr. Justice Day delivered the opinion of the court : 
 
 Suit was brought in the court of claims by the United Engineering 
 & Contracting Company to recover of the United States upon a con- 
 
 83 In accord : Batterbury' v. Vyse, 2 H. & C. 42 (1863) . Cf. Milner v. Field, 
 5 Exeh. ^9 (1850). 
 
814 OPERATION OF CONTEACT (Gh. 4 
 
 tract, dated the 15th of September, 1900, for the construction within 
 seven calendar months from the date of the contract, namely, by April 
 15, 1901, of a pumping plant for Dry Dock No. 3 at the New Yorlc 
 Navy Yards, the work to be done in accordance with certain plans and 
 specifications annexed to and forming a part of the contract. The 
 claimant recovered a judgment (47 Ct. CI. 489), and the United States 
 brings this appeal. 
 
 The principal question in the case involves the correctness of that 
 part of the judgment of the court of claims which permitted the claim- 
 ant to recover $6,000, which the government had deducted as liqui- 
 dated damages for 240 days' delay in the completion of the work, at 
 the rate of $25 per day. To understand this question the terms of the 
 contract and certain facts found by the court of claims, upon which 
 the case is to be considered here, must be had in view. 
 
 [The claimant commenced the construction of the work in accord- 
 ance with the contract, and after a portion thereof had been done, the 
 plans and specifications furnished by the government were found de- 
 fective. The government then made changes in the work to be done, 
 and at times caused entire cessation of the work. Three supplemental 
 agreements were made, not containing any provision for liquidated 
 damages. Further delay was caused by the government's use of the 
 docks for docking vessels. The work was completed and accepted 
 finally by the government on April 5, 1905.]^* 
 
 Notwithstanding the delays of the government, the court of claims 
 found that the claimant, with reasonable diligence, could have com- 
 pleted the plant for tests during the period by about September 21, 
 1903, and found that if it was chargeable for the delay according to 
 the liquidated damage clause of paragraph 12 of the specifications of 
 $25 per day, the deduction would be $750 less than the government had 
 deducted. But it found that, if the claimant was only liable for actual 
 damages, and it did so determine, since there was no evidence as to 
 such damages, the claimant was entitled to recover the entire amount 
 deducted. 
 
 In the original contract the specifications provided, paragraph 12, 
 for liquidated damages for delay, as follows : 
 
 "12. Damages for delay. — In case the work is not completed within 
 the time specified in the contract, or the time allowed by the Chief of 
 the Bureau of Yards and Docks under paragraph 11 of this specifica- 
 tion, it is distinctly understood and agreed that deductions at the rate 
 of $25 per day shall be made from the contract price for each and 
 every calendar day after and exclusive of the date within which com- 
 pletion was required up to and including the date of completion and ac- 
 ceptance of the work, said sum being specifically agreed upon as the 
 measure of damage to the United States by reason of delay in the com- 
 
 " The court's statement of the facts has been abbreviated and part of the 
 opinion is omitted. 
 
Sec. 5) PREVENTION OF PEEFOEMANCB 815 
 
 pletion of the work; and the contractor shall agree and consent that 
 the contract price, reduced by the aggregate of damages so deducted, 
 shall be accepted in full satisfaction for all work done under the con- 
 tract." 
 
 Under the provisions of tliis paragraph, if there had been nothing 
 •subsequently changing the rights of the parties, and the delay had re- 
 sulted from the failure of the claimant to complete the work within 
 the time specified, the deduction at the rate of $25 per day might have 
 been made by the United States as liquidated damages. This was the 
 sum estimated and agreed upon between the parties as the damiages 
 which might be regarded as sustained by the govetnment in event of 
 the breach of the -claimant's obligation to complete the work within the 
 stipulated time. Such contracts for liquidated damages, when reason- 
 able in their character, are not to be regarded as penalties, and may be 
 enforced between the parties. See Sun Printing & Pub. Asso. v. 
 Moore, 183 U. S. 642, 22 Sup. Ct. 240, 46 L,. Ed. 366, in which the mat- 
 ter is fully discussed. 
 
 The precise question here is whether, ,when the work was delayed 
 solely because of the government's fault beyond the time fixed for its 
 completion, and -afterwards the work was completed without any def- 
 inite time being fixed in which it was to be done, the claimant can be 
 charged for the subsequent delays for which he was at fault by the 
 rule of the original contract, stipulating liquidated damages, or was 
 that stipulation waived by the conduct of the government, and was it 
 obligatory upon it, in order to recover for the subsequent delays, to 
 show the actual damages sustained. We think the better rule is that 
 when the contractor has agreed to do a piece of work within a given 
 time, and the parties have stipulated a fixed sum as liquidated dam- 
 ages, not wholly disproportionate to the loss for each day's delay, in 
 order to enforce such payment the other party must hot prevent the 
 performance of the contract within the stipulated time ; and that where 
 such is the case, and thereafter the work is completed, though delayed 
 by the fault of the contractor, the rule of the original contract cannot 
 be insisted upon, and liquidated damages measured thereby are waived. 
 Under the original and first supplemental agreements, the claimant 
 knew definitely that he was required to complete the work by a fixed 
 date. Presumably the claimant had made its arrangements for com- 
 pletion within the time named. Certainly the other contracting party 
 ought not to be permitted to insist upon liquidated damages when it 
 is responsible for the failure to complete by the stipulated date ; to do 
 this would permit it to recover damages for delay caused by its own 
 conduct. 
 
 It may be that damages were sustained by the, failure to carry out 
 the subsequent agreement. But the government, as well as the claimant, 
 saw fit to go on with the work with no fixed rule for the time of its 
 completion, so that it be reasonable, and the government required no 
 
816 OPERATION OF CONTRACT (Ch. 4 
 
 stipulation in the second and third supplemental contracts as to damages 
 in a fixed and definite sum for! failure to complete the work as re- 
 quired. Under such circumstances we think it must be content to re- 
 cover such damages as it is able to prove were actually suffered.** 
 Judgment affirriied. 
 
 PATTERSON v. MEYERHOFER. 
 
 . (Court of Appeals of New York, 1912. 204 N. Y. 96, 97 N. B. 472.) 
 
 Action by Benjamin Patterson against Anna Meyerhofer. From 
 a judgment of the Appellate Division (138 App. Div. 891, 122 N. Y. 
 Supp. 1140), affirming a judgment for defendant, plaintiff appeals. 
 Reversed, and new trial granted. 
 
 WiLLARD Bartlett, J.*° The parties to this, action entered into a 
 written contract whereby the plaintiff^ agreed to sell, and the defend- 
 ant agreed to buy, four several parcels of land with the houses there- 
 on for the sum of $23,000, to be partly in cash and partly by taking 
 title subject to certain mortgages upon the property. When she 
 executed this contract, the defendant knew that the plaintiff was not 
 then the owner of the premises which he agreed to sell to her, but 
 that he expected and intended to acquire title thereto by purchasing 
 the same at a foreclosure sale. Before this foreclosure sale took 
 place, the defendant stated to the plaintiff that she would not performi 
 the contract on her part, but intended to buy the premises for her 
 own account without in any way recognizing the said contract as 
 binding upon her, and this she did, buying tlie four parcels for $5,595 
 each. The plaintiff attended the foreclosure sale, able, ready, and 
 willing to purchase the premises, and he bid for the same, but in 
 every instance of a bid made by him the defendant bid a higher sum. 
 The result was that she acquired each lot for $155 less than she had 
 obligated herself to pay the plaintiff therefor under the contract or 
 $620 less in all. * * * 
 
 '" In accord : Mosler Safe Co. v. Maiden Lane Safe Deposit Co., 199 N. 
 Y. 479, 93 N. E. 81, 37 L. R. A. (N. S.) 363 (1910). 
 
 Performance on time is no longer a condition precedent when it has been 
 prevented by the defendant's own defaults or unjustifiable conduct or by 
 changing the character and amount of the work. Ittner v. U. S., 43 Ct. CI. 
 336 (1908) ; Callahan Const. Co. v. U. S., 47 Ct. CI. 229 (1912) ; Humphrey 
 V. Flaherty, 98 Kan. 634, 158 Pac. 1112 (1916) ; Virginia & K. R. Co. v. 
 Heninger, 110 Va. 301, 67 S. E. 185 (1909) ; Corse v. Linke, 147 Wis. 410, 
 421, 133 N. W. 598 (19J1) ; Kress House Moving Co. v. George Hogg Co., 
 263 Pa. 191, 106 Atl. 351 (1919) ; Mansfield v. Hodgdon, 147 Mass. 304, 17 N. E. 
 1544 (1888) ; French Civ. Code, § 1178 ; Roman Law, Dig. 50, 17, 161. 
 
 The agreed price can be recovered for seed produced when its defects are 
 due to defective seed supplied by the defendant for planting. Burrell v. 
 Masters, 65 Colo. 310, 176 Pac. 316 (1918). 
 
 88 Part of the cotirt's opinion and an entire dissenting opinion are omitted. 
 The dissenting judge said : "It may be assumed that the defendant is pre- 
 cluded by, her ^cts from sustaining any action against the plaintifE for his 
 nonperformance of the conti:act." 
 
Sec. 5) PREVENTION OF PEEFOUMANCE 817 
 
 Upon these facts the plaintiff brought the present action, demand- 
 ing judgment that he has a lien upon the premises purchased by her 
 at the foreclosure sale, and that she holds the same in trust for the 
 plaintiff subject to the contract. The complaint also prays that the 
 plaintiff be awarded the sum of $620 damages, being the difference 
 between the price which the defendant paid at the foreclosure sale 
 for the four houses mentioned in the contract and the price which 
 she would have had to pay the plaintiff thereunder. The learned 
 judge who iiried the case at Special Term rendered judgment in favor 
 of the defendant, holding that, under the contract of sale, there was 
 no relation of confidence between the vendor and vendee. "In the 
 ptesent case," he said, "each party was free to act for his own inter- 
 est, restricted only by the stipulations of the contract." He was, 
 therefore, pf the opinion that "the defendant had a right to buy in 
 at the atictiop, and that she is entitled to hold exactly as though she 
 had been a stranger, and that the plaintiff is not entitled to recover 
 the difference between the price paid at the auction and the contract 
 price." 
 
 I am inclined to agree with the trial court that no relation of trust 
 can be spelled out of the transactions between the parties. * * * 
 There is no need of judicially declaring any trust in the defendant, 
 however, to secure to the plaintiff the profit which he would have 
 made if the defendant had not intervened as purchaser at the fore- 
 closure sale, and had fulfillea the written contract on her part. This 
 is represented by his claim for $620 damages. That amount, under 
 the facts as found, I think the plaintiff was entitled to recover. He 
 has demanded it in his complaint, and he should not be thrown out of 
 court because he has also prayed for too much equitable relief. 
 
 In the case of every contract th«re is an implied undertaking on the 
 part of each party that he will not intentionally and purposely do 
 anything. to prevent the other party from carrying out the agreement 
 on his part. This proposition necessarily follows from the general 
 rule that a party who causes or sanctions the breach of an agreement 
 is thereby precluded from recovering damages for its nonperformance 
 or from interposing it as a defense to an action upon the contract. 
 Young V. Hunter, 6 N. Y. 203 ; Barton v. Gray, 57 Mich. 622, 24 N. 
 W. 638, and cases there cited. "Where a party stipulates that another 
 shall do a certain thing, he thereby impliedly promises that he will 
 himself do nothing which may hinder or obstruct that other in doing 
 that thing." Gay v. Blanchard, 32 La. Ann. 497. 
 
 By entering, into the contract to purchase from the plaintiff prop- 
 erty which she knew he would have to buy at the foreclosure sale in 
 order to convey it to her, the defendant impliedly agreed that she 
 would do nothing to prevent him from acquiring the property at such 
 sale. The defendant violated the agreement thus implied on her part 
 by bidding for and buying the premises herself. Although the plain- 
 tiff bid therefor, she uniformly outbid him. Presumably, if she had 
 
 CORBIN CONT 52 
 
818 OPERATION OF CONTRACT (Ch. 4 
 
 not interfered, he could have bought the property for the same ptice 
 which she paid for it. He would then have been able to sell it to her 
 for the price specified in the contract (assuming that she fulfilled the 
 contract), which was $620 more. This sum, therefore, represents the 
 loss which he has suffered. It is the measure Oif the plaintiff's dam- 
 ages for the defendant's breach of contract. * * * 
 
 For these reasons, the judgments of the Appellate Division and the 
 Special Term should be reversed and a new trial grantea, with costs 
 to abide the event. 
 
 E. I. DU PONT DE NEMOURS POWDER CO. v. 
 SCHLOTTMAN. 
 
 (Circuit Court of Appeals of the United States, Second Circuit, 1914. 218 
 Fed. 353, 134 C. C. A. 161.) 
 
 Ward, Circuit Judge.^" In July, 1908, one Grubb was negotiating 
 with T. C. Du Pont, president of the Du Pont Powder Company, for 
 the sale of the whole capital stock of the Pittsburgh Fuse Company 
 to the Du Pont Company. July 20th Du Pont wrote to Grubb as 
 follows : 
 
 "Mr. Chas. G. Grubb, Building — Dear Sir: Should the dea,l now 
 under discussion iot the Pittsburgh Fuse Mfg. Co. go through, and 
 after we have had the property a year, it is understood that if in my 
 judgment the property has for any reason been worth $175,000 to our 
 company, and we manufactured double tape fuse at $2 per thousand 
 with powder at $3.60 per keg, we are to pay you $25,000 in either 
 bonds, preferred or common stock of our company as we may elect. 
 "Yours truly, T.^C- Du Pont, President." 
 
 On July 24th the deal referred to in the letter went through in a 
 formal agreement whereby the Du Pont Company agreed to pay 
 Grubb $75,000 of its preferred and $75,000 of its common stock for 
 the whole capital stock of the Pittsburgh Fuse Company. Grubb de- 
 livered the Fuse Company's stock and the Du Pont Company trans- 
 ferred to it its own stock, but, after operating the plant for about six 
 months, sold it to other parties, who dismantled it. 
 
 Grubb, the plaintiff's assignor, died before suit brought, and Mr. T. 
 C. Du Pont did not testify to the circumstances attending the writing 
 of the letter of July 20th. At the conclusion of the case each party 
 asked Judge Ray to direct a verdict in his favor, and he did direct a 
 verdict in favor of the plaintiff for $25,000. 
 
 The complaint treats the letter and the formal agreement as one 
 contract, alleges that the defendant by selling the plant of the Fuse 
 Company wrongfully prevented the test agreed upon, and claims 
 damages for the difference between the fair and reasonable value of 
 the Fuse Company's capital stock alleged to be $175,000 and the mar- 
 
 " Part of the opinion is omitted. 
 
Sec. 5) PREVENTION OP PEEPORMAfJCE 819 
 
 ket value of the defendant's stock actually received, alleged to be 
 $120,000. 
 
 The defendant contends that the letter of July 20th is a separate 
 contract, and, as it is not to be performed within the year, is void 
 under the statute of frauds, because it does not state any considera- 
 tion. We think, however, that the two documents are to be consider- 
 ed together. The Du Pont Company was to pay $25,000 more in 
 securities if in the judgment of T. C. Du Pont upon operating for one 
 year, the plant was worth $175,000 to his company and was capable 
 of making double tape fuse at $2 per thousand feet with powder at 
 $3.60 a keg. This was to be additional compensation for additional 
 value, so that the objection of the statute of frauds is unavailing. 
 
 The letter does not contain any express promise to operate the 
 plant for one year, and the question is whether such a promise is to 
 be implied. We think the court below-rightly held that it was. The 
 seller evidently thought the plant worth $175,000 in the defendant's 
 securities, and the buyer was willing to pay the additional $25,000 if 
 such value was demonstrated in the way provided. The letter im- 
 plies a promise on the Du Pont Company's part to operate the plant 
 for a year, and that promise must be taken as part of the considera- 
 tion for which Grubb -sold the capital stock. The authorities support 
 this conclusion. * * * 
 
 The question of damages is the only other question we think need- 
 ing consideration. If the plaintiff could now perform or secure a 
 performance of the agreed test, he might be obliged to do so as a 
 condition of recovering the contract price. But the defendant has 
 made performance impossible by selling the plant within the period 
 of one year to a purchaser who has dismantled it. No similar test 
 can be substituted. It was personal in its nature, viz., the operation 
 for a year by a wealthy and expert corporation actuated by self- 
 interest to make tape fuse at $2 a thousand feet. Because the defend- 
 ant has made the performance of this test impossible, the plaintiff 
 should not be remediless. We think he had the right to show, if he 
 could, in other ways, that the value of the plant was greater by $25,- 
 000 than the sum paid for it. As Judge Bartlett said in Hopedale Co. 
 v. Electric Storage Battery Co., 184 N. Y. 356, 364, 77 .N. E. 394, 397: 
 "In other words, the performance of a condition for valuation having 
 been prevented by the act of the vendee, the price of the thing sold 
 was to be fixed by the jury on a quantum valebat." * * * 
 
 Judgment affirmed.*' 
 
 »s The recovery here seems to be quasi contractual in character. But, In 
 eases where the plaintiff has fully performed the agreed consideration, the 
 contract thus becoming unilateral, he should be able to maintain debt for 
 the agreed price, even though some collateral condition precedent has not 
 •been fulfilled, provided its fulfillment has been prevented by the defendant 
 and such prevention was riot contemplated by the parties as a privileged act. 
 See Colvin v. Post Mortgage & Land Co., 225 N. T. 510, 122 N. E. 454 (1919) ; 
 Brackett v. Knowlton, 109 Me. 43, ^ Atl. 436 (1912) ; Crooker v. Holmes, 
 
820 OPERATION OF CONTRAOT (Ch. 4 
 
 TURNEI^ V. SAWDON & CO^ 
 (In thd Court of Appeal. [1901] 2 K. B. 653.) 
 
 Application by the defendants for judgment or for a new trial in an 
 action tried by Kennedy, J., with a jury. 
 
 The defendants carried on. business as cotton-warp agents at Brad- 
 ford, Yorkshire, and in March, 1898, an agreement was entered into 
 by them with the plaintiff, who was in their employment, which con- 
 .tained the following clauses: "(1) The said G. E. Sawdon & Co. 
 agree to continue to engage and employ the said Ernest Turner as 
 their servant and representative salesman from the 1st day of March, 
 1898, for a period of four years ending February 28, 1902. * * * 
 (2) The said G. E. Sawdon & Co. further agree to remunerate the 
 said Ernest Turner for his services by a payment to him of a salary 
 of £200 per annum, to be paid in monthly installments, for the space 
 of two years, and £250 per annum for the remaining two years. 
 * * * (3) The said Ernest Turner agrees to devote the whole oi 
 his time to the business of the said G. E. Sawdon & Co., to faithfully 
 serve them as heretofore in soliciting orders and generally in aiding 
 to conduct the business, and not to divulge to any competitor or other 
 person any of the business secrets of the said G. E. Sawdon & Co. 
 whilst in their service, and to carefully obey their directions from time 
 to time, and will keep, protect, and promote the success of the said 
 business as far as he can. * * * " 
 
 The plaintiff acted as salesman for some time; but on December 
 31, 1900, a letter was handed to him by the defendants, which was as 
 follows : "We have decided that you shall take a month's holiday — 
 that is to say, that although you will still be in the employ of the firm 
 and at their disposal, you will not after to-day be required to perform 
 any duties. You will please call for your salary on January 31, when 
 any further instruction will be given you." The plaintiff came to the 
 office of the firm on the following day but was requested to leave. 
 
 65 Me. 195, 20 Am. Rep. 687 (1875) ; Eumsey v. Livers, 112 Md. 546, 77 
 Atl. 295 (1910) ; Case v. Beyer, 142 Wis. 496, 125 N. W. 947 (1910) ; Wolf 
 T. Marsh, 54 Cal. 228 (1880). 
 
 If the plaintiff has not fully performed the consideration, his remedy is 
 express assumpsit for damages. In MacPherson v. Mackay, 91 N. J. Law, '473, 
 103 Atl. 36 (1918), the court says that the plaintiff's claim for the defend- 
 ant's prevention of fulfillment ,by the plaintiff is "one of tort-feasance." 
 But in Loehr v. Dickson, 141 Wis. 332, 124 N. W. 293, 30 L. E. A. (N. S.) 
 495 (1910), where the plaintiff strongly argued that his action was in tort, 
 the court held that it was not in tort but was based upon an implied agree- 
 ment not to prevent performance. In accord with this, see Simon v. Etgen, 
 213 N. Y. 589, 107 N. B. 1066 (1915) ; Brucker v. Manistee & G. R. Co., 166 
 Mich. 330, 130 N. W. 822 (1911) ; Gay v. Blanchard, 32 La. Ann. 497, 504 
 (1880) ; U. S. V. Behan, 110 U. S. 338, 4 Sup. Ct. 81, 28 L. Ed. 168 (1884),; 
 St. John V. St. John, 223 Mass. 137, 111 N. E. 719 (1916)!; Levy & Hippie 
 Motor Co. V. City Motor Cab Co., 174 111. App. 20 (1912) ; Vynior's Case, 8 
 Co. Rep. 81b (1610) ; Warburton v. Storr, 4 B. & C. 102 (1825) ; Tuffly v. 
 Houston Motor Car Co. (Tex. Civ. App.) 205 S. W. 832 (1918). 
 
Sec. 5) PREVENTION OF PERFORMANCE 821 
 
 Immediately afterwards circulars were issued by the defendants to 
 their customers stating that the plaintiflf had no authority to transact 
 any business on their behalf. The plaintiff then commenced business 
 on his own account, and brought this action against the defei'idants 
 for damages for breach of the agreement of March, 1898, on the 
 ground that the defendants "after the 3Ist December, 1900, have neg- 
 lected and refused, and still neglect and refuse, to continue to engage 
 and employ the plaintiff as their servant and representative salesman, 
 in accordance with the terms of the said agreement;" 
 The learned judge left the following questions to the jury: 
 
 (1) Was the plaintiff ready and willing to perform the agreement 
 according to its terms? Answer, Yes. 
 
 (2) Did the defendants' conduct on December 31, 1900, and Janu- 
 ary 1, 2, 3, and 4, 1901, constitute a breach of their obligations under 
 their contract, towards the plaintiff? Answer, Yes. 
 
 (3) Was it such a substantial breach as to justify the plaintiff in 
 treating it as a refusal on the part of the defendants to perform and 
 abide by the contract? Answer, Yes. 
 
 (4) If the above questions are answered in the affirmative, what 
 damages is the plaintiff entitled to? Answer, £125. 
 
 On further consideration, the learned judge gave judgment for the 
 plaintiff for the amount of the damages found by the jury. 
 
 The defendants appealed. 
 
 A, L,. Smith, M. R.*° This is an action tried before my brother 
 Kennedy with a special jury. The matter has given rise to some 
 complication, chiefly, as it appears to me, because the learned j'udge 
 left the construction of an agreement to the jury. There was no term 
 of art and no question of (Custom the meaning or the existence of 
 which might properly be left to the jury. It was for the judge at the 
 trial to construe the written agreement and we have now to say what 
 construction should be put upon it. I do not say that the meaning of 
 the document is clear, but I have arrived at the conclusion that the 
 result of the trial was not right. The action is by a man who was 
 in the employment of the defendants, and it Xvas not brought for 
 wages, because it is clear that the defendants were always ready and 
 willing to pay all that was due under the contract. The real question 
 which plaintiff thought to raise, and which was raised, was wjiether 
 beyond the question of remuneration there was a further obligation 
 on the masters that, during the period over wbich the contract was to 
 extend, they should find continuous, or at least some, employment for 
 the plaintiff. In my opinion such an action is unique— that is an 
 action in which it is shevvn that the niaster is willing to pay the wages 
 of his servant, but is, sued for damages because the servant is not 
 given employment. In Turner v. Goldsmith, [1891] 1 Q. B. 544, the 
 
 «» The opinion of Stirling, L. J., and part of tlie opinion of Vaughan Wil- 
 liams, L. 3., are omitted. 
 
822 OPERATION OF CONTRACT (Ch. 4 
 
 wages were to be paid in the form of commission, and that impHedly 
 created a contract to find employment for the servant. This con- 
 tract is different, being to employ for wages which are to be paid 
 at a certain rate per year. I do not think this can be read otherwise 
 than as a contract by the master to retain the servant, and during the 
 time covered by the retainer to pay himi wages under such a contract. 
 It is within the province of the master to say that he will go on pay- 
 ing the wages, but that he is under no obligation to provide work. 
 The obligation suggested is said to arise out of the undertaking to 
 engage and employ the plaintiff as their representative salesman. ' It 
 is said that if the salesman is not given employment which allows him 
 to go on the market his hand is not kept in practice, and he will not 
 be so efficient a salesman at the end of the term. To read in an obli- 
 gation of that sort would be to convert the retainer at fixed wages 
 into a contract to keep the servant in the service of his employer in 
 such a manner as to enable the former to become au fait at his work. 
 In my opinion, no such obligation arose under this contract, and it is 
 a mistake to stretch the words of the contract so as to include in 
 what is a mere retainer an obligation to employ the plaintiff continu- 
 ously for the term of his service. I asked whether the employment 
 must be de die in diem and the answer was that this was not neces- 
 sary, but I could not gather what, short of this, was the suggested 
 obligation. It seems to me that the only argument open to the plain- 
 tiff was that his employment should be continuous, and I cannot find 
 that obligation in the contract. 
 
 I think, therefore, that the case should not have been left to the 
 jury, and that we ought to direct that judgment be entered for the de- 
 fendants. 
 
 Vaughan WiIvUAMs, L,. J. I entirely agree. In my opinion, if the 
 facts are taken to be exactly in accordance with the plaintiff's evi- 
 dence, there was no case to go to the jury. So far as the pleadings 
 are concerned, the action is for breach of the terms contained in a 
 written contract. It was put on behalf of the plaintiff that the action 
 was based on a repudiation by the master of the contract with the 
 plaintiff, and it was said that the plaintiff had a right to treat the case 
 as if it were an action. for ^vrongful dismissal, and is entitled to re- 
 cover damages on that footing none the less because the master has 
 been ready and willing to pay the wages agreed upon. For the pur- 
 poses of my judgment I accept that suggested basis of action, but I 
 still say that there was no case to go to the jury.'" * * * 
 
 9» Followed in Turpin v. Victoria Palace (K. B.) 119 L. T. 405 (1918), music 
 hall artiste. Cf. In re an Arbitration between Rubel B. & M. Co. and Vos, 
 [1918] 1 K. B. 315, compensation to include a share of profits. , 
 
Sec. 5) WAIVER OF CONDITIONS 823 
 
 (b) Waiver ot Conditions 
 
 CRAIG V. LANE. 
 (Supreme Judicial Court of Massachusetts, 1912. 212 Mass. 195, 98 N. E. 685.) 
 
 Action by Frank H. Craig against John J. Lane. There was a ver- 
 dict for plaintiff, and defendant brings exceptions. Overruled. 
 
 This was an action of contract for the purchase of three cars of 
 potatoes at 90 cents per bushel. 
 
 Sheldon, J. We see no ground on which the exceptions can be 
 sustained. The ruling asked for by the defendant could not have been 
 given; and that is the only question presented. 
 
 The defendant's contract was an entire one for the purchase of three 
 cars of potatoes ; and it was not severed by the fact that the plaintiff 
 shipped them at different times and drew a separate draft for the 
 alleged contents of each car at the agreed price. We assume without 
 deciding that upon discovering the shortage which he claimed in the 
 load of the first car he might have declined to accept it and rescinded 
 his contract. But he chose not to do this. Instead of doing so he ac- 
 cepted that car load and sold it to a customer of his own, thus put- 
 ting it beyond his power to return it to the plaintiff. He could not 
 then rescind the contract by reason of the shortage. He must seek his 
 remedy under the contract by way of set-off or recoupment, or by 
 an independent action. Morse v. I5rackett, 98 Mass. 205 ; Mansfield 
 V. Trigg, 113 Mass. 350; Barrie v. Earle, 143 Mass. 1, 8 N. E. 639, 
 58 Am. Rep. 126; Obery v. Lander, 179 Mass. 125, 130, 60 N. E. 
 378; Fullam v. Wright & Colton Wire Cloth Co., 196 Mass. 474, 476, 
 82N. E. 711. 
 
 Exceptions overruled. "'^ 
 
 '1 "A part performance or a defective performance of a condition precedent 
 is generally not sufficient. But after one party has performed the contract in 
 a substantial i>art, and the other party has accepted and had the benefit of 
 the part performance, the latter may thereby be precluded from relying upon 
 the- performance of the residue as a condition precedent to his liability." 
 Fulton V. Miller, 254 Pa. 363, 98 Atl. 1065 (1916). See, also, Breen Stone Oo. 
 V. W. F. T. Bushnell Co., 117 Minn. 283, 135 N. W. 993 (1912), quality of 
 building materials ; Boone v. Templeman, 158 Cal. 290, 110 Pac. 947, 139 Am. 
 St. Rep. 126 (1910) ; Stevinson v. Joy, 164 Cal. 279, 128 Pac. 751 (1912). 
 
 Where payment or other performance by a certain time is a condition pre- 
 cedent, this may be waived by any voluntary statement to that effect or by 
 continuing to receive or to urge performance. Pressy v. McCornack, 235 
 Pa. 443, 84 Atl. 427 (1912) ; Amer. Mortg. Co. v. Williams, 103 Ark. 484, 145 
 S. W. 234 (1912), time limit for mortgage redemption; Bay v. Common- 
 wealth life Ins. Co., 184 Ky. 215, 211 S. W. 736 (1919) ; Dunn v. Steubing, 
 120 N. Y. 232, 24 N. B. 315 (1890) ; Deeves & Son v. Manhattan Life Ins. Co., 
 195 N. Y. 324, 88 N. E. 395 (1909) ; Morton v. Kane, ]8 Ind. 191 (1862) ; Phil- 
 lips & C. Const. Co. V; Seymour, 91 U. S. 646, 23 L. Ed. 341 (1875) ; Van 
 Stone V. Stilwell & B. Mfg. Co., 142 U. Su 128, 12 Sup. Ct. 181, 35 L. Ed. 961 
 
S24 OPERATION OB" CONTRACT (Ch. 4 
 
 McKENNA V. VERNON. 
 (Supreme Court of Pennsylvania, 1917. 258 Pa. 18, 101 Atl. 919.) 
 
 Assumpsit by Bernard J. McKeima, trading as John McKenna & 
 Son, against William J. Vernon. From a judgment for plaintiff, de- 
 fendant appeals. AfSrmed. 
 
 Stewart, J. This was an action to recover a balance alleged to be 
 due on a building contract. By written agreement under date of Jan- 
 uary 20, 1914, the plaintiff undertook the erection and completion of 
 a moving picture theater at 1526-28 Cymberland street in the city 
 of Philadelphia, agreeably to certain plans and specifications which 
 accompanied and were made part of the agreement, he to receive 
 therefor, in full compensation, the sum of $7,750, to be paid by the 
 owner to the contractor wholly upon certificates of the architect as fol- 
 lows : Eighty per cent, of the work set in place as the work proceeds, 
 the first payment within 30 days after the completion of the work; 
 all payments to be due when certificates of the same shall have been 
 fssued by the architect; the building to be completed by April 20, 1914, 
 and the work to be done under the direction of the architect. A 
 supplemental agreement was entered into by the parties March 24, 
 1914, which provided for an enlargement of the theater biiilding, for 
 which the contractor was to receive an additional $1,000. The main 
 provisions of this agreement were similar to those contained in the 
 earlier. By the later agreement the work. was to be completed on 
 or before the 11th of May, 1914. From time to time, as the work 
 progressed, the owner made several payments on account, amounting 
 in all to $6,000. Suit was brought, August 28, 1914, to recover the 
 balance of $2,750, with interest from June 30, 1914. Defense was 
 made on several grounds : Failure of contractor to erect and complete 
 the building in accordance with the plans and specifications, the sub- 
 stituting of inferior and cheaper materials, and inferior workmanship 
 throughout, ■entailing, for the supply and correction of the same, if 
 attempted, a large expenditure. Further, defendant claimed that the 
 building was not completed within the time allowed by the contract, 
 and demanded as a set-off a penalty of $283.35. The trial resulted 
 in a verdict for the plaintiff for $2,500. At the conclusion of the evi- 
 dence, the defendant asked for a compulsory nonsuit, which was re- 
 fused. 
 
 (1891) ; Maryland Steel Co. of Baltimore County v. U. S., 235 U. S. 451, 35 
 Sup. Ct. 190, 59 L. Ed. 312 (1915). 
 
 Where proof of loss within a fixed time is made a condition by an insur- 
 ance policy, the condition may be waived, even after the expiration of the 
 period fixed. Johnson v. Bankers' Mut. Casualty Ins. Co., 129 Minn. 18, 
 151 N. W. 413, L. R. A. 1915D, 1199, Ann. Cas. 1936A, 154 (1915) ; Dezell v. 
 Fidelity & Casualty Co., 176 Mo. 253, 75 S. W. 1102 (1903) ; Kiernan v. 
 Dutchess County Mut. Ins. Co., 150 N. Y. 190, 44 N. E. 698 (1896) ; Lebanon 
 Mut. Ins.. Co. V. Erb, 112 Pa. 149, 4 Atl. 8 (1886) ; Ovcen v. Farmers Joint 
 Stock Ills. Co., 57 Barb. (N. Y.) 518 (1869). i 
 
Sec. 5) WAIVER OF CONDITIONS 825 
 
 The several assignments of error, in one form and another, relate 
 directly or indirectly to this one feature of the case, and are all based 
 on the theory that, in the absence of a certificate from the architect of 
 the final completion of the building in accordance with plans and speci- 
 fications, no right of action existed. Not only is there no express 
 provision to this eflfect in the contract, but the contract itself shows 
 that no distinction is there made between final payment and the pay- 
 ments on account of the 80 per cent, of work in place. All pay- 
 ments were to be made only on certificate of the architect, and yet 
 with a single exception each of the seven payments made as the work 
 progressed was made without a certificate being asked for. With such 
 constant and repeated disregard on the part of the owner to exact 
 compliance with this provision in the contract, it is too late now for 
 him to insist that failure on the part of the plaintiff to secure such 
 certificate before suit defeats his right of action. Furthermore, on 
 the trial, the architect, called as a witness, testified that the plaintiff 
 had performed substantial compliance with all the requirements of the 
 contract, that he had not given the certificate to this effect only be- 
 cause it had not been asked for, and that whatever variations there 
 were from the specifications were authorized and directed by him. The 
 provision in the contract for written certificates from the architect is 
 for the benefit and protection of the owner. If he waived it repeated- 
 ly, as he did here, during the progress of the work, he cannot complain 
 if he be held to have waived it when he seeks to defend against a final 
 payment for work shown to have been honestly and substantially per- 
 formed, especially when almost daily he has had the work under his 
 own observation, without remonstrance or complaint at any time with 
 respect to either the work done or materials employed. This being 
 the situation, the court was entirely right in refusing the nonsuit. 
 
 For like reason, there was no error in refusing to give binding 
 instructions for the defendant. If the court was right in these rulings, 
 the other assignments of error necessarily fall. 
 
 The judgment is affirmed."^ 
 
 '^In accord: Mayer Bros. Const. Co. v. American Sterilizer Co., 258 
 Pa. 217, 101 Atl. 1002 (1917) ; Pennsylvania Rubber Co. v. Detroit Ship- 
 building Co., 186 Mich. 305, 152 N. W. 1071 (1915) ; Douglass & Vamum v. 
 Village of Morrisville, 89 Vt. 393, 425, 95 Atl. 810 (1913), written order as con- 
 dition precedent for extra work ; O'Loughlin v. Poll, 82 Conn. 427, 74 Atl. 763 
 US19), same. 
 
 A waiver may. be conditional, and becomes operative on fulfillment of the 
 condition. Thompson v. Postal Life Ins. Co., 226 N. Y. 363, 123 N. E. 750 
 (1919). 
 
 The term "waiver!' is frequently used in cases where there is really a new 
 substituted agreement, modifying and discharging pro tanto the original con- 
 tract. See California Raisin Growers Assn. v. Abbott, 160 Cal. 601, C06, 117 
 Pae. 767 (1911) ; Mahoney v. Hartford Inv. Corp., 82 Conn. 280, 73 Atl. 766 
 (1909) new agreement for extras, but without the written order required 
 originally. Distinguish sharply between substituted contract, estoppel, and 
 voluntary waiver, both as to the operative facts themselves and as to their 
 ■effect on the legal relations of the parties. 
 
826 OPERATION OP CONTRACT (Ch. i 
 
 CLARK V. WEST. 
 
 (Court of Appeals of New Xork, 1908. 193 N. T. 349, 86 N. E. 1.) 
 
 Action by William L. Clark against John B. West. From a judg- 
 ment of the Appellate Division of the Supreme Court reversing an 
 interlocutory judgment overruling a demurrer to the complaint and 
 sustaining the demurrer (125 App. Div. 654, 110 N. Y. Supp. 110), 
 plaintiff, by permission, appeals, and the Appellate Division certifies 
 questions. Reversed, and interlocutory judgment affirmed. 
 
 On February 12, 1900, the plaintiff and defendant entered into a 
 written contract, under which the former was to write and prepare 
 for publication for the latter a series of law books, the compensation 
 for which was provided in the contract. After the plaintiff had com- 
 pleted a three-volume work known as "Clark & Marshall -on Corpora- 
 tions," the parties disagreed. The plaintiff claimed that the defendant 
 had broken the contract by causing the book to be copyrighted in the 
 name of a corporation which was not a party to the contract, and he 
 brought this action to recover what he claims to be due him, for an 
 accounting and other relief. The defendant demurred to the com- 
 plaint on the ground that it did not state facts sufficient to constitute 
 a cause of action. The Special Term overruled the demurrer, but up- 
 on appeal to the Appellate Division that decision was reversed, and the 
 demurrer sustained. 
 
 Those portions of the contract which are germane to the present 
 stage of the controversy are as follows : The plaintiff agreed to write 
 a series of books relating to siJecified legal subjects. The manuscript 
 furnished by him was to be satisfactory to the defendant. The plain- 
 tiff was not to write or edit anything that would interfere with the 
 sale of books to be written by him under the contract, and he was not 
 to write any other books unless requested so to do by the defendant, in 
 which latter event he was to be paid $3,000 a year. The contract con- 
 tained a clause which provided that "the first party (the plaintiff) 
 agrees to totally abstain from the use of intoxicating liquors during 
 the continuance of this contract, and that the payment to him in ac- 
 cordance with the terms of this contract of any money in excess of $2 
 per page is dependent on the faithful performance of this as well as 
 the other conditions of this contract. * * * " In a later para- 
 graph it further recited that, "in consideration of the above' promises 
 of the first party (the plaintiff), the second party, (the defendant) 
 agrees to pay to the first party $2 per page, * * * on each book 
 prepared by the first party under this contract and accepted by the 
 second-party, and if said first party abstains from tlie use of intoxicat- 
 ing liquor and otherwise fulfills his agreements as hereinbefc^-e set 
 forth, he shall be paid an additional $4 per page in manner hereinbe- 
 fore stated." This was followed by a specification of the method and 
 times of payment. * * * 
 
Sec. 5) WAIVER OF CONDITIONS 827 
 
 The plaintiff in his complaint alleges completion of the work on 
 Corporations and publication thereof by the defendant, the sale of 
 many copies, thereof from which the defendant received large net 
 receipts, the number of pages it contained (3,469), for which he had 
 been paid at the rate of $2 per page, amounting to $6,938, and that 
 defendant has refused to pay him any sum over and above that 
 amount, or any sum in excess of $2 per page. Full performance of 
 the agreement on plaintiff's part is alleged, except that he "did not to- 
 tally abstain from the use of intoxicating liquor during the continu- 
 ance of said contract; but such use by the plaintiff was not excessive 
 and did not prevent or interfere with the due and full performance 
 by the plaintiff of all the other stipulations in said contract." The 
 complaint further alleges a waiver on the part of the defendant of 
 the plaintiff's stipulation to totally abstain from the use of intoxicat- 
 ing liquors, as follows : "(12) That defendant' waived plaintiff's breach 
 of the stipulation to totally abstain from the use of intoxicating liq- 
 uors during the continuance of said contract; that long prior to the 
 completion of said manuscript on Corporations, and its delivery to and 
 acceptance by tlie defendant, the defendant had full knowledge and 
 well knew of plaintiff's said use of intoxicating liquor during the con- 
 tinuance of said contract, but nevertheless acquiesced in and failed to 
 object thereto; and did not terminate the contract on account thereof ; 
 that with full knowledge of said breach by the plaintiff defendant 
 continued to exact and require of the plaintiff performance of all the 
 other stipulations and conditions of said contract, and treated the 
 same as still in force, and continued to receive, and did receive, in- 
 stallments of manuscript under said contract, and continued to make 
 and djd make payments to plaintiff by way of advancements, and 
 finally accepted and published said pianuscript as aforesaid; that at 
 no time during the performance of said contract by the' plaintiff did 
 the defendant notify or intimate to the plaintiff that defendant would 
 insist upon strict compliance with said stipulation to totally abstain 
 from the use of intoxicating liquor, or that defendant intended to take 
 advantage of plaintiff's said breach, and on account and by reason 
 thereof refuse to pay plaintiff the royalty stipulated in said contract; 
 that, on the contrary, and with full knowledge of plaintiff's said use 
 of intoxicating liquors, defendant repeatedly avowed and represented 
 to the plaintiff that he was entitled to and would receive said royalty 
 payment, and plaintiff believed and relied on said representation, and 
 in reliance thereon continued in the performance of said contract un- 
 til the time of the breach thereof by the deffendant, as hereinafter spe- 
 cifically alleged, and at all times during the writing of said treatise on 
 Corporations, and after as well as before publication thereof, as afore- 
 said, it was mutually understood, agreed, and intended by the parties 
 hereto that, notwithstanding plaintiff's said use of intoxicating liquors, 
 he was nevertheless entitled to receive and would receive said royalty 
 as the same accrued under said contract." The defendant's breach of 
 
Ch.4 
 
 828 OPEEATION OF CONTRACT (I 
 
 the contract is then alleged, which is claimed to consist in his having 
 taken out a copyright upon the plaintiff's work on Corporations in the 
 name of a publishing company which had no relation to the contract, 
 and the relief asked for is that the defendant be compelled to account, 
 and that the copyright be transferred to the plaintiff, or that he recov- 
 er -its value. 
 
 The appeal is by permission of the Appellate Division', and the fol- 
 lowing questions have been certified to us: (1) Does the complaint 
 herein state facts sufficient to constitute a cause of action? (2) Under 
 the terms of the contract alleged in the complaint, is the plaintiff's 
 total abstinence from the use of intoxicating liquors a condition pre- 
 cedent which can be waived so as to render defendant liable upon the 
 contract notwithstanding plaintiff's use of intoxicating liquors? (3) 
 Does the complaint herein allege facts constituting a valid and effec- 
 tive waiver of plaintiff's' nonperformance of such condition precedent?- 
 
 WernBr, J.°^ * * * Briefly stated, the defendant's position is 
 that the stipulation as to plaintift''s total abstinence is the consideration 
 for the pajTnent of the difference between $2 and $6 per page, and 
 therefore could not be waived except by a new agreement to that ef- 
 fect based upon a good consideration; that the so-called waiver 
 alleged by the plaintiff is not a waiver, but a modification of the con- 
 tract in respect of its consideration. The plaintiff, on the other hand, 
 argues that the stipulation for his total abstinence was merely a con- 
 dition precedent, intended to work a forfeiture of the additional com- 
 pensation in case of a breach, and that it could be waived without any 
 formal agreement to that effect based upon a new consideration. 
 
 The subject-matter of the contract was the writing of books by the 
 plaintiff for the defendant. The duration of the contract was the 
 time necessary to complete them all. The work was to be done to the 
 satisfaction of the defendant, and the plaintiff was not to write any 
 other books except those covered by the contract, unless requested so 
 to do by the defendant, in which latter event he was to be paid for 
 that particular work by the year. The compensation for the work 
 specified in the contract was to be $6 per page, unless the plaintiff fail- 
 ed to totally abstain from the use of intoxicating liquors during the 
 continuance of the contract, in which event he was to receive only 
 $2 per page. That is the obvious import of the contract construed in 
 the light of the purpose for which it was made, and in accordance with 
 the ordinary meaning of plain language. It is not a contract to write 
 books in order that the plaintiff shall keep sober, but a contract con- 
 taining a stipulation that he shall keep sober so that he may write sat- 
 isfactory books. When we view the contract from this standpoint, it 
 will readily be perceived that the particular stipulation is not the con- 
 sideration for the contract, but simply one of its conditions which 
 fits in with those relating to time and metliod of delivery of manu- 
 
 »3 The statement and the opinion have been somewhat abbreviated. 
 
Sec. 5) WAIVEE OF CONDITIONS 829 
 
 script, revision of proof, citation of cases, assignment of copyrights, 
 keeping track of new cases and citations for new editions, and other 
 details which might be waived by the defendant, if he saw fit to do so. 
 This is made clear, it seems to us, by the provision that, "in considera- 
 tion of the above promises," the defendant agrees to pay the plaintiff 
 $2 per page on each book prepared by him, and if he "abstains from 
 the use of intoxicating liquor and otherwise fulfills his agreements 
 as hereinbefore set forth, he shall be paid an additional $4 per page 
 in manner hereinbefore stated." The compensation of $2 per page, 
 not to exceed $250 per month, was an advance or partial payment of 
 the whole price of, $6 per page, and the payment of the two-thirds, 
 which was to be withheld pending the performance of the contract, 
 was simply made contingent upon the plaintiff's total abstention from 
 the use of intoxicemts during the life of the contract. * * * 
 
 It is obvious that the parties thought that the plaintiff's normal 
 work was worth $6 per page. That was the sum to be paid for the 
 work done by the plaintiff, and not for total abstinence. If the plain- 
 tiff did not keep to the condition as to total abstinence, he was to lose 
 part of that sum. * * * This, we think, is the fair interpretation 
 of the contract, and it follows that the stipulation as to the plaintiff's 
 total abstinence was nothing more nor less than a condition precedent. 
 If that conclusion is well founded, there can be no escape from the 
 corollary that this condition could be waived ; and, if it was waived, 
 the defendant is clearly not in a position to insist upon the forfeiture 
 which his waiver was intended to annihilate. The forfeiture must 
 stand or fall with the condition. If the latter was waived, the former 
 is no longer a part of the contract. Defendant still has the right to 
 counterclaim for any damages which he may have sustained in con- 
 sequence of the plaintiff's breach, but he cannot insist upon strict per- 
 formance. Dunn V. Steubing, 120 N. Y. 232, 24 N. E. 315 ; Parke v. 
 Franco-American Trading Co., 120 N. Y. 51, 56, 23 N. E. 996; Brady 
 V. Cassidy, 145 N. Y. 171, 39 N. E. 814. 
 
 This whole discussion is predicated, of course, upon the theory of an 
 express waiver. • We assume that no waiver could be implied from the 
 defendant's mere acceptance of the books and his payment of the sum 
 of $2 per page without objection. It was the defendant's duty to pay 
 that amount in any event after acceptance of the work. The plaintiff 
 must stand upon his allegation of an express waiver, and if he fails to 
 establish that he cannot maintain his action. 
 
 The theory upon which the defendant's attitude seems to be based 
 is that, even if he has represented to the plaintiff that he would not 
 insist upon the condition that the latter should observe^ total abstinence 
 from intoxicants, he can still refuse to pay the full contract price for 
 his work. The inequity of this position becomes apparent when we 
 consider that this contract was to run for a period of years, Juringa 
 large portion of which the plaintiff was to be entitled only to the 
 advance pa3anent of $2 per page; that balance being contingent, 
 
830 OPERATION OF CONTKACT (Ch. 4 
 
 among other things, upon publication of the books and returns from 
 sales. Upon this theory the defendant might have waived the condi- 
 tion while the first book was in process of production, and yet, when 
 the whole work was completed, he would still be in a position to insist 
 upon the forfeiture because there had not been strict performance. 
 Such a situation is possible in a case where the subject of the waiver 
 is the very consideration of a contract (Organ v. Stewart, 60 N. Y. 
 413, 420), but not where the waiver relates to something that can be 
 Waived. In the case at bar, as we have seen, the waiver is not of the 
 consideration or subject-matter, but of an incident to the method of 
 performance. The consideration remains the same. The defendant 
 has had the work he bargained for, and it is alleged that he has waiv- 
 ed one of the conditions as to the manner in which it was to have 
 been done. He might have insisted upon literal performance, and 
 then he could have stood upon the letter of his contract. If, however, 
 he has waived that incidental condition, he has created a situation to 
 which the doctrine of waiver very precisely applies. 
 
 The cases which present the most familiar phases of the doctrine 
 of waiver are those which have arisen out of litigation over insurance 
 policies where the defendants have claimed a forfeiture because of 
 the breach of some condition in the contract (Insurance Co. v. Norton, 
 96 U. S. 234, 24 L. Ed. 689; Titus v. Glens Falls Ins. Co., 81 N. Y. 
 410; Kiernan v. Dutchess Co. Mut. Insurance Co., 150 N. Y. 190, 44 
 N. E. 698), but it is a doctrine of general application which is con- 
 fined to no particular class of cases. A "waiver" has been defined to 
 be the intentional relinquishment of a known right. It is voluntary 
 and implies an election to dispense with something of value, or forego 
 some advantage which the partv waiving it might at its option have 
 demanded or insisted upon (Herman on Estoppel & Res Adjudicata, 
 vol. 2, p. 954; Cowenhoven v. Ball, 118 N. Y. 234, 23 N. E. 470), 
 and this definition is supported by many cases in this and other states. 
 In the recent case of Draper v. Oswego Co. Fire R. Ass'n, 190 N. Y. 
 12, 16, 82 N. E. 755, Chief Judge CuUen, in speaking for the court 
 upon this subject, said: "While that doctrine and the doctrine of 
 equitable estoppel are often confused in insurance litigation, there is a 
 clear distinction between the two. A 'waiver' is the voluntary aban- 
 donment or relinquishment by a party of some right or advantage. As 
 said by my Brother Vann in the Kiernan Case, 150 N. Y. 190, 44 N. 
 E. 698: 'The law of waiver seems to be a technical doctrine, intro- 
 duced and applied by the court for the purpose of defeating forfei- 
 tures. * * ,* While the principle may not be easily classified, it is 
 well established that, if the words and acts of the insurer reasonably 
 justify the conclusion that with full knowledge of all the facts it in- 
 tended to abandon or not to insist upon the particular defense after- 
 wards relied upon, a verdict or finding to that effect establishes a 
 waiver, which, if it once exists, can never be revoked.' The doctrine 
 of equitable estoppel, or estoppel in pais, is that a party may be pre- 
 
Sec. 5) 
 
 WAIVER OF CONDITIONS 831 
 
 eluded by his acts and conduct from asserting a right to the detriment 
 of another party who, entitled to rely on such conduct, has acted upon 
 it. * * * As already said, the doctrine of waiver is to relieve 
 against forfeiture. It requires no consideratio;i for a waiver, nor 
 any prejudice or injury to the other party." To the same eflfect, see 
 Knarston v. Manhattan Life Ins. Co., 140 Cal. 57, 73 Pac. 740. 
 
 It remains to be determined whether the plaintiff has alleged facts 
 which, if proven, will be sufficient to establish his claim of an express 
 waiver by the defendant of the plaintiff's breach of the condition to 
 observe total abstinence. In the 12th paragraph of the complaint, the 
 plaintiff alleges facts and circumstances which we think, if established, 
 would prove defendant's waiver of plaintiff's performance of that 
 contract stipulation. * * * 
 
 The three questions certified should be answered in the affirmative, 
 the order of the Appellate Division reversed, the interlocutory judg- 
 ment of the Special Term affirmed, with costs in both courts, and the 
 defendant be permitted to answer the complaint within 20 days upon 
 payment of costs. 
 
 JOBST v. HAYDEN BROS, et al. 
 
 (Supreme Court of Nebraska, 1909. 84 Neb. 735, 121 N. W. 957, 50 L. R. A. 
 
 [N. S.] 501.) 
 
 Mechanic's lien foreclosure by Bernhardt J. Jobst against Hayden 
 Bros., impleaded with Joseph R. Lehmer and others. Judgment for 
 plaintiff, and Hayden Bros, appeal. Reversed and remanded. 
 
 Cai,kins, C.** This was an action by the plaintiff to fbreclose a 
 mechanic's lien upon a building which he had erected under a written 
 contract with the defendant, Hayden Bros., a corporation, hereinafter 
 called the "owner." A portion of his claim was for the balance of the 
 contract price, to which were added, for extras, sundry items. The 
 owner contested a portion of these claims for extras and demanded a 
 large sum for defects in construction and damages for delay in the 
 completion of the building. The district court allowed part of plain- 
 tiff's claim for extras and deducted from the plaintiff's contract price 
 for defects in construction, $100 for the freezing of the west«wall, and 
 $500 on account of defective floor topping. It found that the owner 
 agreed to and did release the plaintiff from any and all claims for dam- 
 ages on account of delay in completing the building and rendered judg- 
 ment against it for the sum of. $9,520.38. * * * 
 
 6. The contract provided that the plaintiff was to finish and deliver 
 to the owner the subbasement and basement on or before the 1st day of 
 June, 1905, and to complete and turn over the whole building on or 
 before the 1st day of September in the same year, and it contained the 
 
 »* Part of the opinion is omitted. 
 
832 OPERATION OF OONTEAOT (Ch. 4 
 
 stipulation that if the contractor , should fail to deliver said building 
 complete in every respect on the 1st day of September, 1905, he should 
 pay the owner as liquidated damages the sum of $25 per day for each 
 day after the 1st day of September, 1905, until the building should be 
 delivered by him, unless he was prevented from so doing by some of 
 the causes which the contract provided should be a sufficient excuse for 
 delay. The building was not in fact completed until the following June. 
 The evidence shows that the rental value of the building complete ex- 
 ceeded the sum of $25 per day, and the owner claims that it should be 
 allowed that amount under the provisions of this contract. The plain- 
 tifif, claims that the delay in the completion of the work was caused 
 by the failure to finish the excavation, and, further, that in July, 1905, 
 the owner, agreed to waive the time clause in the contract. The court 
 below made no finding as to the cause of the delay, but found that the 
 owner waived the time clause and agreed to and did release the plain- 
 tiff from any and all claims on account of delays in completing the 
 building within the time limited in the contract. The owner argues that 
 the evidence does not sustain this finding, but a careful reading of the 
 testimony convinces us that this contention cannot be maintained, and 
 that the finding of fact by the district court is fully sustained. Further, 
 the;owner insists that, if such a promise was made by it, it was without 
 consideration and therefore invalid as a contract, and that it was not 
 acted upon by the plaintiff so as to estop the owner from insisting upon 
 its invalidity. We are of the opinion that the contention of the owner 
 upon this point must be sustained, and that its promise to waive the 
 time clause, being without consideration, is void as a contract, and that, 
 the plaint!^ not being shown to have acted upon the same, the owner is 
 not estopped now to make a claim" for such damages. 
 
 7. It does not, however, follow that the promise of the owner, though 
 not amounting to a contract nor estopping it to claim damages for de- 
 lay, had no effect whatever. The provision of the contract respecting 
 delays which should extend the plaintiff's time for the completion of 
 the building was as follows: "Should the contractor be obstructed or 
 delayed in the prosecution or completion of his work by the act, neglect, 
 delay or default of the owner or architect or any other contractor em- 
 ployed by such owner upon the work, then the time herein, fixed for the 
 completion of the work shall be extended for a period equivalent to the 
 time lost by reason of any or all of the causes aforesaid, , But no such 
 allowance shall be made unless a claim therefor is presented in writing 
 to the architect within 24 hours of the occurrence of such delay, ^he 
 duration of such extension shall be certified to by the architect," It 
 does not appear that the plaintiff made a claim in writing to the archi- 
 tect for an extension of time in accordance with these provisions, and 
 it is very strenuously insisted that, in the default of having taken such, 
 action, he is precluded now from showing that he was delayed by the 
 fault of the owner or other contractors. If it be true, as the district 
 
Sec. 5) 
 
 WAIVER OF CONDITIONS 833 
 
 court found, and its finding as we have seen must be here sustained, 
 that the owner made this agreement, £ind the plaintiff, relying upon its 
 promise, neglected to make his claim in writing, we thitik the owner 
 should be and is estopped to insist upon the provisions of this clause. 
 It would have been an idle act for the plaintiff to ask an extension 
 when the owner had already promised not to insist npon the completion 
 of the building at the time stipulated. Such a promise naturally lulled 
 the contractor into a sense of security and was well calculated to pre- 
 vent him from taking steps under the provisions of the contract quoted. 
 We therefore conclude that the plaintiff was entitled to an extension of 
 the time equal to the period of delay caused by the failure of the owner 
 to have his property in condition for the erection of the build- 
 ing." 
 
 SHALLENBERGER v. STANDARD SANITARY MFG. CO. 
 (Supreme Court of Pennsylvania, 1909. 223 Pa. 220, 72 Atl. 500.) 
 
 Assumpsit for breach of contract by E. E. Shallenberger against 
 the Standard Sanitary Manufacturing Company. Judgment for plain- 
 tiff, and defendant appeals. vAffirmed. 
 
 Stewart, J. It is not correct to say that the contract here was in- 
 complete and inoperative so long as the bond stipulated for had not 
 been given by the contractor. With the sealing and delivery of the 
 written agreement the contract at once became operative, and there- 
 after, for a breach by either of the parties in any of its terms, the 
 other would have appropriate remedy. Que of the terms required that 
 the contractor should "furnish satisfactory trust company bond in the 
 sum of twenty thousand dollars ($20,000) for the faithful performance 
 of all and singular his covenants, and for the protection of the par- 
 ties of the first part against mechanics' liens, and all-damages, losses, 
 delays, or other injury sustained by reason of the failure of the said 
 party of the second part to keep and perform all his covenants." 
 
 ^'' The waiver of a condition precedent to the defendant's duty must be 
 sharply distinguished from a discharge (or "waiver") of the plaintiff's duty 
 to perform as agreed. (For the latter, see post, Discharge of Contract.) 
 Performance by the plaintiff as a condition precedent to the defendant's duty 
 may be waived without discharging the defendant's right to damages for non- 
 performance by the plaintiff. Phillips & C. Const. Co. v. Seymour. 91 U. S. 
 646, 23 L. Ed. 341 (1875) ; Otis Elevator Co. v. Flanders Realty Co., 244 Pa. 
 186, 90 Atl. 624 (1914) ; York v. York Rys. Co., 229 Pa. 236, 78 Atl. 128 
 (1910) ; MaGirl v. Hastings, 120 111. App. 276 (1905) ; Machinery & Electrical 
 Co. V. Young Men's Christian Ass'n, 22 Cal. App. 416, 134 Pac. 724 (1913) ; 
 Brooklyn Structural Steel Corp. v. Lechtman, 92 Misc. Rep. 164, 155 N. 
 Y. Supp. 220 (1915) ; Frankfurt-Bamett Co. v. William Prym, 237 Fed. 21, 150 
 C. C. A. 223, L. R. A. 1918A. 602 (1916) ; Bast v. Byrne, 51 Wis. 531, 8 N. 
 W. 494, 37 Am. Rep. 841 (1881). 
 
 The right to damages may also be discharged for a consideration or by 
 estoppel. O'Loughlin v. Poll, 82 Conn. 427, 435, 74 Atl. 763 (1909) ; Maryland 
 Steel Co. of Baltimore County r. V. S., 235 U. S. 451, 35 Sup. Ct. 190, 59 L. 
 Ed. 312 (1915). 
 
 COBBIN CONT. — 53 
 
834 OPERATION OF CONTRACT (Ch. 4 
 
 By the contracj:, executed April 27, 1905, plaintiff undertook, for 
 a consideration of $64,692, to remove from a certain lot in the city 
 of Allegheny owned by defendant company the buildings then stand- 
 ing and occupied by the defendant company, and erect thereon a pat- 
 tern shop and storage warehouse and a warehouse building, and com- 
 plete the same by September 1st following. Without having given the 
 bond required plaintiff was allowed to enter at once upon the work. 
 He proceeded without delay to tear down and remove the old buildings, 
 and prepare the ground for constructive work. The defendant would 
 have been entirely within its rights had it denied possession of the 
 premises until bond had been given, and, for a failure of the plaintiff 
 to furnish the bond within a reasonable time, it would have been jus- 
 tified in rescinding the contract. But possession having been given, 
 and the work having been entered upon, while the defendant's right 
 to demand the bond thereafter continued, as well as its rights to re- 
 scind for default by the plaintiff, yet rescission could only be justified 
 as proper regard was paid to the rights of the plaintiff under conditions 
 existing at the time. 
 
 In a communication addressed to plaintiff, under date of May 19th, 
 Mr. Reed, general manager for the defendant company, requested that 
 the latter file his bond with either the secretary of the company or its 
 architect. The day following the receipt of this letter the plaintiff 
 testified that he called on Mr. Reed, and told him that he had made 
 application to a trust company in West Virginia for a surety bond, but, 
 because of the absence of a party whom he wished to see in connection 
 with it, he was delayed; that he would get it as soon as possible, and 
 would not ask any money on the contract until the bond had been de- 
 livered to the company. To this representation Mr. Reed replied, "All 
 right." The plaintiff thereafter continued his work under the con- 
 tract. By June 5th he had the ground cleared, had 8 or 10 car loads 
 of lumber on the ground, and was ready to proceed with the erection 
 of the buildings. On that day defendant gave the plaintiff a written 
 notice, which reads as follows: "Under the terms of the agreement 
 dated April 27, 1905, prepared for construction of buildings in Al- 
 legheny city for S. S. M. Co., it is provided tha,t you shall give a satis- 
 factory bond in the sum of $20,000 for the faithful performance of 
 the work. As the contract cannot be closed till this is done, you are 
 hereby notified that unless the bond is delivered by Thursday, June 8, 
 1905, by twelve o'clock noon, we shall let the work to another con- 
 tractor." • 
 
 If, as here asserted, the contract had not been closed, the defendant 
 was under no obligation' to the plaintiff with respect to it ; it was 
 nothing but an open negotiation from which either could withdraw at 
 pleasure. This was a strange theory to adopt, and may explain in a 
 measure the summary process attempted by the defendant. As we 
 have said, the contract was an executed one, binding upon both parties, 
 which neither could rescind except for justifying reasons. Treating 
 
Sec. 5) WAivEK by conditions 835 
 
 the communication, however, as a notice that the company would re- 
 scind the contract, unless the bond were furnished by noon of June 
 8th — and the plaintiff so understood it — the one question is, Was 
 the time allowed under the notice reasonable, in view of all the circum- 
 stances of the case? 
 
 The plaintiff testified that at the time the notice was received his 
 application for a surety bond of the Citizens' Trust & Guarantee 
 Company of Parkersburg, W. Va., had been approved by the company. 
 Under date of June 8th — though it must have been the 9th — he wrote 
 to the defendant advising that this bond had been executed by the 
 trust company the day previous, June 8th, and would arrive by due 
 course of mail. On either the next day or that following plaintiff 
 tendered this bond to the defendant's general manager, Mr. Dawes, 
 who repHed, "Well, it is all right; but, as we have made the change 
 now, we intend to do the work ourselves, and don't wish to make the 
 change again." Thereupon, plaintiff was denied permission to pro- 
 ceed with his work on the premises. It is complained that the court 
 submitted to the jury the question of reasonable notice to plaintiff 
 of the intention to rescind, instead of deciding it as a matter of law. 
 This assumes that there was no dispute as to the facts on which plain- 
 tiff relied to justify or excuse his delay in furnishing the bond. It 
 would unduly extend this opinion if we were to refer in detail to 
 the many and marked contradictions which appear in the testimony. 
 Let a single instance suffice. 
 
 In determining whether a three-day limit for the filing of the bond 
 was affording the plaintiff a reasonable time, what preceded the giving 
 of the notice was as much for consideration as what followed. That 
 the reasonableness of the time depended on the situation and circum- 
 stances of the parties at the time is true, but whatever in the conduct- 
 of either had contributed to the situation so far as concerned the 
 other was proper matter of inquiry. The plaintiff, immediately after 
 the first written request for a bond, had told the defendant's general 
 manager that application had been made to the trust company in Park- 
 ersburg for a surety bond in the stipulated sum. If in that conversa- 
 tion the manager told plaintiff what the latter says he did, a waiver 
 of the right to require prompt delivery of a bond, in consideration of 
 plaintiff making no pressing demand for money or any payment on 
 his contract before delivery of the bond, might well be inferred. If 
 there were such waiver, then when the notice of June 5th was given, 
 plaintiff could not be said to be in default. A three days' notice to one 
 who in open, disregard of his covenants, and in spite of repeated de- 
 mands for compliance, was in default might well be regarded as rea- 
 sonable; while such a requirement would be wholly unreasonable 
 with respect to another whose delay had been with the acquiescence 
 of the party having a right to the bond. Did the conversation occur 
 as plaintiff says, or was it as the general manager testified? Cer- 
 tainly what passed between these parties was relevant, and it was 
 
836 operIation of contract ' (Ch. 4 
 
 wholly for the jury to determine what the conversation was, and 
 its effect. So, too, in regard to other relevant facts. The facts being 
 undetermined, a submission to the jury was unavoidable. 
 
 From what we have said as to the real and only issue in the case 
 it results that no error was committed in rejecting defendant's offer 
 to show plaintiff's financial condition. Whatever that condition was, it 
 did not prevent plaintiff from procuring the required bond and ten- 
 dering it to defendant on the day following defendant's rescission. 
 The question was whether that was a reasonable compliance with 
 defendant's demand. Nor was it error to refuse consideration of the 
 fact that the bond tendered by plaintiff was a bond of a foreign cor- 
 poration. Defendant did not put its refusal of acceptance on any 
 such ground, but solely on the ground that the bond had not been 
 tendered in time. Not only so, but when defendant,' weeks before, 
 was advised that plaintiff had applied to this company for a surety 
 bond to meet the requirements of his contract, no such objection was 
 made. This fact may not have required the company to accept such 
 bond; but, if rejected finally for any such reason, the plaintiff would 
 have been entitled to further time to procure another.** 
 
 The measure of damages the jury were instructed to observe was 
 a correct one. Plaintiff had made subcontracts for two-thirds of the 
 material required for the construction of the building, and offered 
 testimony to show what additional expenditure would be required to 
 complete the buildings in accordance with the contract. The appro- 
 priation of these subcontracts by the defendant company is conclusive 
 as to the cost of the material embraced, and the testimony as to the 
 additional cost required was convincing to the jury. They were in- 
 structed by the court to estimate from these data the value of plain- 
 tiff's contract, first ascertaining from the evidence what the entire 
 cost of the building would be to the plaintiff, and deducting this sum 
 
 »«In List & Son Co. v. Chase, 80 OMo St. 42, 88 N. E. 120, 17 Ann. Cas. 
 (51 (1909), the court said: "We do not deny that under some circumstances 
 a refusal to accept goods for a stated reason may operate as a waiver of other 
 objections, which might have been properly made. This may be so in cases 
 where the silence of the purchaser and his conduct operate to mislead the 
 seller and prevent him from protecting himself; in other words, where the 
 conduct of the buyer would raise an estoppel against him. But when the 
 buyer has absolutely rejected the goods, for whatever reason, his silence as to 
 other objections which would justify his refusal to accept, when unaccom- 
 panied by conduct which may have misled and prejudiced the vendor, cannot 
 be construed as a waiver of the buyer's right to insist' on his plea of non- 
 performance on those grounds. The reason which underlies this proposition 
 is that a waiver must be voluntary — that is, intentional, with knowledge 
 of the facts and of the party's rights^or it must be implied from conduct 
 which amounts to estoppel." 
 
 For cases holding that a waiver or an estoppel existed on this ground, see 
 Littlejohn v. Shaw, 159 N. X. 188, 53 ^f. E. 810 (1899) ; Ginn v. W. C. Clark 
 Cx)al Co., 143 Mich. 84, 106 N. W. 86?; 107. N. W. 904 (1908) ; Bonney v. 
 Blaisdelly 105 Mo. 121, 73 Atl. 811 (1909) ; Sutton v. Risser, 104 Iowa, 681, 74 
 N. W. 23 (1898), shortage in amount waived where seller offered to make 
 it up; Lohr Bottling Co. v. Ferguson, 223 111. 88, 79 N. E. 35 (1908), archi- 
 tect's certificate ; Goodman v. Purnell, 187 Fed. 90, 109 0. C. A. 408 (1911) . 
 
Sec. 5) WAIVER OF CONDITIONS 
 
 837 
 
 from the contract price. If the defendant had no right to rescind the 
 contract, plaintiff was entitled to compensation; and the measure of 
 damages adopted was the only one, depending upon the sufficiency 
 of the evidence, by which this could be determined. 
 
 The assignments of error are overruled. 
 
 Judgment affirmed."' 
 
 Potter, J. (dissenting). I am unable to agree with the view of the 
 majority of the court in this case. An essential requirement of the 
 proposed contract was that the contractor should furnish bond in the 
 sum of $20,000, to insure the faithful performance of the work. 
 This was not one of the things to be done or furnished as the work 
 progressed, but it was a prerequisite, something required in advance 
 of the performance of the work which it was to guarantee. Some 
 six. weeks passed after the signing of the agreement, and no such 
 bond was furnished by the contractor. The defendant company might 
 well have refused permission to the contractor to enter upon the 
 premises until he had given the security he had agreed to furnish. 
 But instead of standing sharply upon its rights in this respect, it in- 
 dulged the plaintiff further by allowing him to make a start upon the 
 work, at the same time warning him to file the bond within three 
 days. This would have been ample time in which to procure and file 
 the bond, if the financial condition of the plaintiff was sound or his 
 credit good. . 
 
 But instead of procuring a bond with satisfactory sureties, as re- 
 quired by the agreement, the plaintiff finally offered, as a compliance 
 widi his obligation, the bond of a foreign corporation not authorized 
 to do business in the state of Pennsylvania. Such a bond was of 
 course unsatisfactory to the defendant company, and it refused to ac- 
 cept it, or to allow plaintiff to proceed further with the work. In so 
 doing the defendant was acting clearly within its rights under the 
 contract. Surely it was not obliged to run the risk of placing a large 
 and important contract in the hands of an irresponsible contractor, 
 who had failed to furnish the bond agreed upon. Under the admitted 
 facts of the case I can see nothing which should properly have been 
 submitted to a jury. The result was, to give to the plaintiff the profits 
 of a contract which he never carried out in accordance with its terms, 
 
 *' Where performance on time or in a certain manner has ceased to be a 
 condition precedent by reason of a waiver, it can generally again be made a 
 condition by express notice to that effect. In the absence of such notice it 
 will no longer operate as a condition. The notice operates to end assent and 
 also to prevent further, estoppel by reliance on the previous waiver. See 
 Lawson v. Hogan, 93 N. T. 39 (188.?) ; Schmidt v. Reed, 132 N. Y. 108, 30 N. 
 E. 373 (1892) ; Taylor v. Goelet, 208 N. Y. 253, 101 N. B. 867, Ann. Cas. 1914D, 
 284 (1913); Monson v. Bragdon, 159 111. 61, 66, 42 N. E. 3.83 (1895); Jakes v. 
 North American Union, 186 111. App. 1 (1914) ; Boone v. Templeman, 158 Cal. 
 290, 110 Pac. 947, 139 Am. St. Rep. 126 (1910) ; Stevinson v. Joy, 164 Cal. 
 279, 128 Pac. 751 (1912) ; Standard Brewing Co. v. Anderson, 121 La. 935, 46 
 South. 926, 15 Ann. Cas. 251 (1908) ; Wilt v. Hammond Bros., 179 Mo. App. 
 406, 165 S. W. 362 (1914) ; Walker v. McMurchie, 61 Wash. 489, 112 Pac. 
 500 (1911). 
 
.^m, 
 
 838 OPERATION OF CONTRACT (Ch. 4 
 
 and, for work which he never performed, and which he had no right 
 to even attempt to perform until he had furnished the bond. 
 
 I would reverse the judgment. 
 
 Brown and Elkin, JJ., concur in this dissent. 
 
 CATHOLIC FOREIGN MISSION SOC. OF AMERICA, Inc., v. 
 
 OUSSANI et al. 
 
 (Court of Appeals of New York, 1915. 215 N. T. 1, 109 N. B. 80, Ann. Cas. 
 
 1917A, 479.) 
 
 Action by the Catholic Foreign Mission Society of America, In- 
 corporated, against Joseph Oussani, impleaded with others. Judg- 
 ment for plaintiff was modified and affirmed by the Appellate Divi- 
 sion (157 App. Div. 893, 142 N. Y. Supp. 1111), and defendant Ous- 
 sani appeals. Reversed, and new trial granted. 
 
 Cardozo, J. The action is for specific performance. . The defendant 
 Oussani is the owner of a tract of land in Westchester county. 
 He undertook to sell it to the plaintiff, a membership corporation. 
 The plaintiff was represented by its president. Father Walsh. A 
 memorandum of the terms of the agreement was put in writing, and 
 signed. It is dated July 12, 1912. It calls for a conveyance of the 
 land free from all incumbrances. In particular, it provides that a 
 road known as the Lohgwood road, which , ran through the land, 
 shall be closed. Unless this change can be made within one week, 
 the plaintiff is to be "in no way obliged." The price is to be $45,000, 
 of which $15,000 is to be paid in cash, and $30,000 by a purchase- 
 money mortgage. 
 
 Longwood road was a public highway, and the local authorities 
 refused to close it. Father Walsh went to view the land on July 
 18th, and again on the day following. His purpose was to ascertain 
 whether the road would interfere with the construction of a build- 
 ing. He then stated to Oussani that he would waive the condition 
 of the contract to the effect that the road must be closed. There is 
 evidence from which the inference may be drawn that Oussani re- 
 quested the waiver and approved of it. That the buyer's purpose 
 might not be doubtful, a letter was mailed on July 19th, in which 
 Oussani was again informed that there had been a waiver of the 
 condition. On the following day he gave notice that he would not 
 carry out the sale. He had sold the property, it appfears, at a larg- 
 er price to some one else. There was a tender of the money and of 
 a purchase-money mortgage. The tender was rejected, and this ac- 
 tion was begun. * * * 
 
 If tTie directors are found on a new trial to have authorized the 
 purchase, we think the plaintiff's right to a decree of specific per- 
 formance will follow. The argument is made that, even though 
 there was a contract, it lacks the mutuality essential to relief in eq- 
 
Sec. 5) WAIVEE OF CONDITIONS 839 
 
 uity. If the public easement or right of way is not extinguished, the 
 buyer, by the terms of the contract, has the right to rescind. We 
 think the reservation of that right does not involve a failure of the 
 equitable remedy. ]>vin v. Dietz, 194 N. Y. 376, 87 N. E. 454, 20 
 L. R. A. (N. S.) 251. The Longwood road was an incumbrance. 
 Like any other incumbrance, it gave the buyer the right to rescind 
 the contract and reject the title. But a buyer in such circumstanc- 
 es is not bound to rescind. He may waive the condition, and accept 
 the title though defective. If he does, the seller may not refuse to 
 convey because the buyer could not have been compelled to waive. 
 Bostwick V. Beach, 103 N. Y. 414, 422, 9 N. E. 41. In this case the 
 plaintiff did waive the condition. It announced its waiver while the 
 contract was still in force. There had been no attempt by the seller 
 up to that time to recede from his bargain."* 
 
 We think the waiver to be effective did not call for the seller's ap- 
 proval. There is evidence, however, that he not only approved of 
 it, but induced it* The condition which was the subject-matter of 
 the waiver was for the benefit of the buyer solely. From the moment 
 that the waiver was announced, the remedy was mutual. Fry on 
 Spec. Perf. (5th Ed.) p. 238; Dyas v. Cruise, 2 Jo. & Lat. 460, 487; 
 Beatson v. Nicholson, 6 Jur. 620; Hawksley v. Outram, [1892] 3 
 Ch. 359; Barker v. Cox, L. R. 4 Ch. Div. 464, 469. There may 
 be an exception here to the general rule that mutuality must be 
 judged of as at the date of the contract, but, if so, it is as well es- 
 tablished as the rule itself. Palmer v. Gould, 144 N. Y. 671, 39 
 N. E. 378, holds nothing to the contrary. The opinion lof Judge 
 Gray in that case was not adopted by the court (144 N. Y. 684, 39 
 N. E. 378), but, if we assume its correctness, it is inapplicable here. 
 All that it suggests is that partial performance may sometimes be 
 refused where a vendee, knowing of the defect, has taken the chance 
 of its removal, and where conveyance of a part" interest would work 
 a hardship to the vendor. See 144 N. Y. 682, 39 N. E. 378; also 
 Hexter v. Pearce^ (1900) 1 Ch. 341, 345. There is no such hardship 
 here. The vendee is not exacting compensation for the broken con- 
 dition. It has waived the condition ^altogether. If the contract 
 bound the plaintiff the defendant must perform. * * * 
 
 Judgment reversed, etc.*® 
 
 »8 See, also, Cape May Eeal Estate Co. v. Henderson, 231 Pa. 82, 79 Atl. 982 
 (1911) ; Korman v. Trainer, 258 Pa. 362, 101 Atl. 1051 (1917). 
 »" Reversed for reasons Dot here involved. Part of the opinion is oinitted. 
 
840 OPERATION OP CONTRACT (Ch. 4 
 
 A. D. GRANGER CO. v. BROWN-KETCHAM IRON WORKS. 
 (Court of Appeals of New York, 1912. 204 N. Y. 218, 97 N. E. 523.) 
 
 Action by the A. D. Granger Company against the Brown-Ketch- 
 am Iron Works. From a judgment of the Appellate Division (138 
 App. Div. 909, 123 N. Y. Supp. 1104) affirming a judgment for plain- 
 tiff, defendant appeals. Reversed and remanded. 
 
 Wii<LARD BARTLErr, J.^ This suit was brought to recover a balance 
 alleged to be due under a contract in writing whereby the plaintiff 
 corporation agreed to sell and deliver, and the defendant corpora- 
 tion agreed to purchase and receive, certain vault linings to be placed 
 in the Essex county courthouse at Newark, N. J. There is some 
 dispute as to whether the contract was embodied in a single letter 
 or in a series of letters ; but, whichever be the fact, it is clear that 
 it contained this provision: "Terms, net cash. Immediate pay- 
 ment after written acceptance by the architect." The architect thus 
 referred to was Mr. Cass Gilbert, who was employed by Essex coun- 
 ty to supervise the erection of the courthouse. The complaint made 
 no mention of the provision respecting payment which I have quot- 
 ■ed. It alleged that the plaintiff delivered the vault linings therein 
 specified, and that they were accepted by the defendant and were 
 used and incorporated in the work. The answer denied that they 
 were actepted or were used or incorporated in the work, except aft- 
 er being repaired and altered ; and there was a counterclaim for 
 the expense of repair and alteration. 
 
 The plaintiff utterly failed to prove any written acceptance of any 
 of the vault linings by the architect prior to the commencement of 
 the action. Over the objection and exception of the defendant it 
 was allowed to introduce in evidence a certificate by Mr. Cass Gil- ' 
 bert, dated August 16, 1906, 18 months after the suit was brought, 
 stating that the contractors for the construction of the Essex coun- 
 ty courthouse were entitled to the forty-fourth paynient on their con- 
 tract. There was nothing on the face of this paper to show that 
 it covered the vault linings which were the subject of the contract 
 between the parties to this action. "As I understand the laW," said 
 the learned trial judge in charging the jury, "that certificate, al- 
 though issued after the action was commenced but also after the 
 work was completed, is competent evidence, and I therefore over- 
 ruled the objections of the defendant and allowed it in evidence." 
 To this instruction the defendant duly exceptecT Although there 
 was no allegation or suggestion of waiver, in the complaint, the 
 court also left it to the jury to say whether the proof did not estab- 
 lish a waiver of the requirement of the contract that a written ac- 
 ceptance or certificate by the architect should be necessary to entitle 
 
 ^ Part of the opinion is omitted. 
 
Sec. 5) WAIVER OF CONDITIONS 841 
 
 the plaintiff to payment. The point that a written acceptance hy 
 the architect was a condition j5recedent to- the right to any payment 
 under the contract, and that a waiver of this condition was not prov- 
 able because it had not been pleaded, was further brought distinct- 
 ly to the attention of the trial judge by. appropriate requests to 
 charge and exceptions to his refusal to charge as requested. 
 
 It requires but little discussion to show that this point was well 
 taken and should have been deemed fatal to any recovery by the 
 plaintiff in the pr^nt form of the pleadings. The contract pre- 
 scribed a condition precedent, to wit, a written acceptance of the 
 vault linings by the architect of the Essex county courthouse, to 
 entitle the plaintiff to payment therefor. No such written accept- 
 ance had been given up to the time of the commencement of the ac- 
 tion. When the suit was begun, therefore, the plaintiff's case was 
 fatally defective in an element essential to make out a cause of ac- 
 tion under the contract The contract did not obligate the defendant 
 to pay until the written acceptance had been obtained; consequent- 
 ly there was no obligation to pay' when the action was commenced.^ 
 
 '' An excuse is not the same thing as performance. It is a legally operative 
 fact, and the legal relations consequent thereon may approach an identity 
 with those that would follow exact performance; but in an action upon an 
 expresg contract it Is generally held that an allegation of full performance is 
 not supported by proof of a part performance and a waiver. ' In such cas© 
 there is said to be a variance. Eureka Fire & Marine Ins. Co. v. Baldwin, 
 e2 Ohio St. 368, 57 N. E. 57 (1900), condition in insurance policy; List & 
 Son Co. v. Chase, 80 Ohio St. 42, 88 N. E. 120, 17 Ann. Oas. 61 (1909), condi- 
 tion in sale of goods; Mehurin v. Stone, 37 Ohio St. 49 (1881), building 
 contract; In re Warner's Estate, 158 Cal. 441, 111 Pac. 352 (1910) ; Peek 
 V. Steinberg, 163 Cal. 127. 124 Pac. 834 (1912), prevention by defendant; 
 Thompson v. St. Charles County, 227 Mo. 220, 126 S. W. 1044 (1910), building 
 contract ; Walsh v. North American Cold Storage Co., 260 III. 322, 103 N. E. 
 185 (1913) ; Herdal v. Sheehy, 173 Cal. 163, 159 Pac. 422 (1916) ; Flickinger 
 V. Wrenn Investment Co., 172 Cal. 132, 155 Pac. 627 (1916), £^n amendment may 
 be allowed; Symms-Powers Co. v. Kennedy, 33 S. D. 355, 146 N. W. STO 
 (1914), the giving of surety bond by a builder; Neuberger v. Robbins, 37 
 Utah, 197, 106 Pac. 933 (1910), full delivery in sale of goods; Northwestern 
 Nat. Life Ins. Co. v. Ward, 56 Okl. 188, 155 Pac. 524 (1916), where defendant 
 pleads denial, it is a departure for the plaintiffs to reply by alleging a 
 waiver or an estoppel. 
 
 It has even been held that an allegation of full performance is not sustain- 
 ed by proof of substantial perforjnance and a waiver. Allen v. Burns, 201 
 Mass. 74, 87 N. E. 194 (1909) : Hennessey v. Preston, 219 Mass. 61, 106 N. 
 E. 570 (1914) ; Long v. Addix, 184 Ala. 236, 63 South. 982 (1913): But where 
 substantial performance is the only condition precedent and this has been 
 fulfilled, no waiver is necessary and an allegation of full performance of con- 
 ditions is sustained by the proof. Smith v. Mathews Const. Co., 179 Cal. 797, 
 179 Pac. 205 (1919) ; Blakely v. Neils Lumber Co., 121 Minn. 280, 141 N. W. 
 179 (1913). 
 
 The problem is quite different where the plaintiff pleads an express repudia- 
 tion as his cause of action, as it is also when he sues for a quasi-contractual 
 recovery. See Chicago Title & Trust Co. v. Sagola Lumber Co., 242 111. 468, 
 92 N. E. 282 (1909) ; Allegheny Valley Brick Co. v. C. W. Raymond Co., 
 219 Fed. 477, 135 C. C. A. 189 (1914) ; West v. Norwich Union Fire Ins. Sbc, 
 10 Utah, 442, 87 Pac. 687 (1894). 
 
 In actions on negotiable instruments, proof of waiver of notice has been 
 allowed even though the declaration alleged the giving of notice. President 
 
842 OPERATION OF CONTRACT (Ch. 4 
 
 The subsequent acceptance or certificate, issued many months 
 afterward, could not relate back so as to place the defendant in 
 default. It was wholly irrelevant, and the court erred in receiving 
 it and in instructing the jury that they might, treat it as timely. In 
 an action at law, the status of the parties is to be. considered as it 
 existed when the suit was begun, unless changed conditions have 
 been brought before the court by means of supplemental pleadings, 
 which was not the case here. * * * 
 
 Judgment reversed, etc. ■ m 
 
 SECTION 6.— IMPOSSIBILITY » 
 
 McCORMICK et al. v. TAPPENDORF et al. 
 (Supreme Court of "Washington, 1909. 51 Wash. 312, 99 Pac. 2.) 
 
 Action by Charles R. McCormick and another, partners as Charles 
 R. McCormick & Co., against Paul F. Tappendorf and another, part- 
 ners as. the Vancouver Lumber Company. From a judgment for 
 plaintiffs, defendants appeal. Reversed and remanded. 
 
 HadlEy, C. J.* This is an action to recover damages for an alleged 
 breach of contract to deliver a quantity of railroad ties. The terms of 
 the contract are set forth in the following copy of a part of the corre- 
 spondence between the parties : "Portland, Oregon, January 23, 1906. 
 Vancouver Lumber Company, Vancouver, Wash. — Gentlemen : We 
 hereby confirm our order for 50,000 pieces of 7x8-8' merchantable 
 Oregon pine ties. These ties not to run over 20 per cent. No. 2 mer- 
 chantable. Any excess No. 2 to be $2.00 per thousand feet less. 
 Inspection and tally at loading point by inspector from Pacific Lum- 
 
 etc. of Taunton Bank v. Richardson, 5 Pick. (Mass.) 436 (1827) ; Camp v. 
 Bates, 11 Conn. 487 (1836) ; Thornton v. Wynn, 12 Wheat. 183, 6 L. Ed. 595 
 (1827) ; Lundie v. Robertson, 7 East, 231 (1806). 
 
 8 The subject matter of this section is arranged in substantially the fol- 
 lowing order : 
 
 I. Prospective impossibility of performance by the plaintiff, where actual 
 performance by him is not a condition precedent ; its effect upon the defend- 
 ant's duty. 
 
 II. Prospective impossibility of performance by the defendant; its effect 
 upon performance by the plaintiff as a condition precedent to- the defendant's 
 duty. 
 
 III. Impossibility of performance by plaintiff where such performance is a 
 condition precedent ; its effect upon the defendant's duty. This impossibility 
 (a) may exist at the time of acceptance, or (b) may arise subsequently. 
 
 IV. Impossibility of performance by the defendant as a termination of his 
 duty (and herein of increased diflBculty and expense). Here, too, the im- 
 possibility (a) may exist at the time of acceptance, or (b) may arise sub- 
 sequently. 
 
 * A small part of the opinion is omitted. 
 
Sec. C) IMPOSSIBILITY 843 
 
 ter Manufacturers' Association, or an inspector to be mutually 
 agreed upon. Price $9.00 per thousand feet, less two per cent. De- 
 livered to ship's tackle along the Columbia river where vessel drawing 
 20 feet can safely lie afloat. Terms cash on presentation of bill of 
 lading, inspection certificate and invoice at the Bank of California, 
 Portland. Delivery of the entire lot to be not later than June 1, 1906. 
 You agree to notify us thirty days before wanting vessel. Vessel" to 
 receive the ties not less than 60,000 feet per day. Yours truly, Charles 
 R. McCormick & Co., Accepted: Vancouver Lumber Co., By W. 
 Tenney, Manager." 
 
 The complaint alleged that the defendants refused to deliver the 
 ties, and recovery for resulting damages was demanded. The defend- 
 ants answered that' they were prepared to carry out their contract, 
 and for that purpose had the- ties sawed and delivered at the Columbia 
 river, that they were ready and willing to deliver the ties according 
 to the contract, but the plaintiffs refused to pay for the same or to 
 make provision for payment as provided by the contract. The cause 
 came on for trial before a jury and resulted in a verdict for the plain- 
 tiffs in the sum of $2,325.83. Judgment for that sum was entered 
 against the defendants, and they have appealed. 
 
 The court in its instructions did not submit to the jury any ques- 
 tions of fact except the amount of damages to be recovered. The 
 appellants excepted to the action of the court in taking from the jury 
 all questions relative to the contract and the breach thereof. It is 
 contended that failure on the respotidents' part to. make preparations 
 to pay cash for the ties on delivery to the ship for loading would be 
 such a breach of their contract as would excuse appellants from actu- 
 ally turning the, ties over to them. It is also urged that there was 
 such evidence tending to prove that the respondents made no prepa^ 
 rations to pay cash as required the submission to the jury of the 
 question of breach of the contract on the part of appellants. It will 
 be noted that the terms of the contract called for delivery of the ties, 
 ■'to ship's tackle along the Columbia river," and the terms of payment 
 are "cash on presentation of bill of lading, inspection certificate and 
 invoice at the Bank of California, Portland." 
 
 It is the respondents' contention that the appellants were required 
 to deliver the ties to the ship and receive a certificate of inspection 
 and an invoice after which they were required to present these to the 
 bank in Portland; that without this they cannot maintain that they 
 are excused from liability. It is true that the appellants could have 
 had no right of action for breach of the contract until they had actu- 
 ally made delivery and payment had been refused ; but the respond- 
 ents brought this action, claiming a breach by appellants for failure 
 to deliver the ties. We think they are not entitled to recover, and 
 that appellants are excused if the evidence shows that at the time the 
 respondents were not in position to make payment as the contract 
 required. One party need not perform a condition precedent if it 
 
844 OPERATION OF CONTRACT (Ch. 4 
 
 appears that the other party cannot or will not perform. "One of 
 two parties should not be required to tender performance when the 
 other has, by act or word, indicated that he will not or cannot accept- 
 it, or will not or cannot do that in return for which the performance 
 was promised. Nor will the courts hold him any longer bound." 9 
 Cyc. 641. 
 
 There was evidence to the effect that, after a vessel was ready to 
 take the ties in the Columbia river, the appellants ordered a tug to 
 tow the ties out to the ship, and then telegraphed the specified bank 
 in Portland to know if arrangements for payment for the ties had 
 been made, and received a negative reply. Appellants then went in 
 person to the Bank of California in Portland, and also to the United 
 States National Bank of Portland, of which latter bank some mention 
 had been made as the place of payment, by reason of the suspension 
 •of business by the Bank of California in San Francisco on account of 
 the recent fire and earthquake. They were informed that no arrange- 
 ments had been made for payment through either bank. It was testi- 
 fied that appellants then telegraphed respondents that the ties wouid 
 not be delivered until arrangements for cash payment were made as 
 required by the contract, that the respondents replied by telegram 
 and proposed that the ties be loaded, and that the appellants accept a 
 ID-days sight draft. All this is proper evidence for the jury, as it has 
 a tendency to show that the respondents were not prepared to, and 
 could not, pay cash upon delivery of the ties, and comply with their 
 contract. It is for' the jury to say what was the fact in that regard. 
 If they should find from the evidence that respondents had not made 
 preparation to comply with the terms of their contract in regard to 
 payment, and that for that reason they could not do so, then appel- 
 lants were excused for refusing to actually deliver possession of the 
 ti'es to respondents. * * * 
 
 Judgment reversed. 
 
 CAPORALE V. RUBINE. 
 
 < Court of Errors and Appeals of New Jersey, 1918. 92 N. J. Law, 463, 105 
 
 Atl. 226.) 
 
 Action by Louis Caporale against Samuel H. Rubine. Judgment 
 for plaintifif, and defendant appeals. Reversed, and new trial ordered. 
 
 Kalisch, J. The legal question presented on this appeal is whether 
 the plaintii? made out a case legally sufficient to warrant its submis- 
 sion, by the trial judge, to a jury for its decision. 
 
 The plaintiff below was permitted to recover a verdict for $925 and 
 costs against the defendant below, as damages, for an alleged breach 
 of contract, and to enter judgment on the verdict from^ which judg- 
 m'ent the defendant appeals. 
 
 The legal question as to the sufificieflcy of the proof is raised by a 
 
Sec. 6) IMPOSSIBILITY 845 
 
 motion for a nonsuit, which was denied, and by a motion to direct a 
 verdict for defendant, which was also refused. 
 
 The case shows that the present litigants entered into a written 
 agreement, whereby the defendant agreed to convey to the plaintiff 
 property in Woodcliffe on Hudson, at a purchase price of $14,850, 
 subject to a mortgage of $10,000. The plaintiff agreed to convey to 
 defendant, in exchange and payment for the property to be conveyed 
 to him, certain lots in Woodcliffe, valued at $10,000, subject to a 
 mortgage of $6,900, and to give defendant a purchase-money mort- 
 gage for $1,750, on the property conveyed by the latter to the plain- 
 tiff. The plaintiff declared in the agreement that the property to be 
 conveyed by him to the defendant was absolutely free and clear of all 
 incumbrances, excepting a balance of $6,900 due the Woodcliffe I^md 
 Improvement Company, represented by the mortgage above refer- 
 red to. The title to the respective property was to be passed on be- 
 fore May 1, 1917, at Mr. Halpin's office. 
 
 The agreement was entered into on the 6th day of April, 1917. It 
 appears that the plaintiff never had the legal title to the property 
 which he contracted to convey to defendant, but that the legal title 
 thereto was and remained in the Woodcliffe Land Improvement Com- 
 pany. This company in July, 1913, entered into an agreement with 
 the plaintiff's wife to convey the property to her upon certain condi- 
 tions to be performed by her and upon her compliance therewith, to 
 make, execute, and deliver to her a deed in fee simple subject to the 
 various restrictions, mentioned in the agreement, and which limit the 
 use of the property by the owner in many material respects. 
 
 The plaintiff's wife died in February, .1916, and by her will she de- 
 vised to her husband the equity in the property arising out of the 
 agreement made by her with the land company. Therefore, when 
 the plaintiff entered into the agreement with the defendant to convey 
 the property to him, the former had simply an equitable title thereto, 
 and, as appears from- the agreement made ^ith the land company, the 
 property was subject to servitudes. 
 
 It is, however, of no importance that the plaintiff, at the time when 
 he entered into the contract, to convey the property to the defendant, 
 was not invested with title to the property, provided he could' establish 
 that he was in a position to perform his undertaking in conformity 
 with the agreement, in that he was able to procure the title or control 
 it and have it conveyed to the purchaser and offers to do so. 39 Cyc. 
 1983. 
 
 It is obvious from the agreement between the parties that there 
 was to be a concurrent performance by both, since the performance 
 of the one was the consideration of the performance of the other. 
 Neither was required to make a tender first. 
 
 The legal rule is well stated b,y Ewing, Chief Justice, in Ackley v. 
 Richman, 10 N. J. Law, at page 306, where he says : "The parties to 
 a contract for the sale of land, unless there is Something peculiar in its 
 
846 OPERATION OF CONTRACT (Ch. 4 
 
 structure, expect and intend the performance on each part at the same 
 time. The delivery of the deed and the payment of the money are to 
 be simultaneous. Each supposes he is to perform upon a correspond- 
 ent performance on the other part. Neither supposes he is bound to 
 perform if the other neglects or refuses, and is to resort after per- 
 formance to a remedy on the covenants. Neither supposes' he is lia- 
 ble to an action by the other, when the other has not performed or 
 offered to perfqrm." 
 
 Counsel of respondent claims that the plaintiff was not legally obli- 
 gated to be in a position to convey a good title at the time fixed in the 
 contract, but only that he should be able to convey a good title at the 
 time of performance ; and, as it appeared that the defendant had di- 
 vested himself of the title to the property which he. had agreed to 
 convey to the plaintiff, the plaintiff was relieved from carrying out his 
 part of the agreement, and was therefore entitled to bring his action 
 for damages. 
 
 The latter part of this contention is obviously unsound. 
 
 Tlfe defendant's act in conveying the title to his property to a third 
 person had no other legal effect than to relieve the plaintiff from 
 making a tender of a deed of his property to the defendant. 
 
 But the plaintiff was not relieved from establishing, in order to re- 
 cover damages for a breach of contract, that he wa,s able and ready to 
 perform his part of . the undertaking. Ackley v. Richman, supra ; 
 Conover v. Tindall, 20 N. J. Law, 513, at pages 515 and 516; Bigler 
 V. Morgan, 77 N. Y. 312; 39 Cyc. 1983; Wells Fargo & Co. v. Page, 
 48 Or. 74, 82 Pac. 856, 3 L. R. A. (N. S.) page 103. 
 
 The measure of the plaintiff's legal obligation in the present case 
 was to establish by competent proof that he was able and ready to 
 convey a title such as would comply with the requirements of the 
 agreement. This he clearly failed to do. 
 
 It is manifest from' the terms of the agreement made by the plain- 
 tiff's wife with the land company that the plaintiff could not have 
 conveyed the title free from the restrictions imposed upon the prop- 
 erty, and that the land company was under no legal duty to make any 
 such conveyance until the year 1926., Furtherm'ore, there was no evi- 
 dence that the land company was ready and willing to make a convey- 
 ance of the title to the defendant at the present time ; nor was there 
 any proof that the land company could lawfully release the property 
 from the restrictions imposed upon it ; or that the company was able 
 and ready to convey the title to defendant, "absolutely free and clear 
 of encumbrances." 
 
 The defendant was therefore entitled to prevail on his motion for a 
 nonsuit and on his motion for a direction of a verdict for defendant. 
 
 The judgment is reversed, and a new trial ordered.^ 
 
 = No action lies against the defendant for a repudiation unless there existed 
 a possibility of performance by the plaintiff. Repudiation or impossibility 
 on the part of the defendant would justify the plaintiff in refusing to per- 
 
Sec. 6) IMPOSSIBILITY 847 
 
 PARDEE V. KANADY et al. 
 (Court of Appeals of New York, 18^5. 100 N. Y. 121, 2 N. B. 885.) 
 
 Rapallo, J. We think that the conclusions of the learned referee 
 as to the construction and eflfect of the agreement of August 28, 1875, 
 were correct. This agreement was not a modification of the previous 
 agreement of February, 1875, nor a substitute ther«for, nor did it 
 operate to extend the time for the delivery of any part of the lumber 
 agreed to be delivered during the season of 1875, but was an inde- 
 pendent-contract to deliver 400,000 feet of lumber during the season 
 of 1876, regardless of the question whether or not the 400,000 feet 
 agreed to be delivered in 1875 were or were not delivered in full. It 
 evidently contemplated the possibility of a breach by the defendants 
 of the contract of February, 1875, and provided that such breach 
 should be excused to the extent of 150,000 feet,i if the defendants 
 should deliver the 400,000 feet in 1876. Still it left the first contract 
 in full force. If the defendants had delivered or tendered the whole 
 400,000 feet under the first contract, as they might have done, there 
 being more than 30 days of their time unexpired when the second con- 
 tract was made, Pardee would have been bound to accept and pay for 
 them, and to take the 400,000 feet in 1876 in addition, and if he had 
 not become insolvent he could have required the defendants to deliver 
 them. Such an arrangement cannot be construed as an extension 
 of time under the ^rst contract as to any part of the lumber deliver- 
 able under it. Each contract stood by itself, with the stipulation, for 
 the benefit of the defendants, that to the extent of 150,(XX) feet they 
 should not be held for damages for a breach of the first, if they fully 
 performed the second. 
 
 The first contract was in fact broken. At the close of the season of 
 1875 the defendants were short in their deliveries 153,495 feet. If 
 they fully performed the second contract they would be relieved from 
 liability for damages upon^ 150,000 feet of this shortage. Consequent- 
 ly, as things stood at the close of the season of 1875, the right of 
 action of M. F. Pardee was complete only as to 3,495 feet, and was 
 suspended as to -150,000 feet until it should be seen whether the de- 
 fendants performed their second contract during the season of 1876. 
 
 About the opening of the season of navigation of 1876, M. F. Par- 
 dee, on April 22d, assigned his property, including his claims under 
 the above contracts, to his father, Myron Pardee, the present plain- 
 tiff, and then became insolvent. The plaintiff continued the business 
 through the agency of M. F. Pardee. The defendants treated this in- 
 form, but they do not cause possibility of performance by the plaintiff to cease 
 to be a condition precedent to his enforceable right. Schueking & Co. v. 
 Young, 78 Or. 483, 153 Pac. 803 (1915) ; Dosch v. Andrus, 111 Minn. 287, 126 
 N. W. 1071 (1910) ; Ward v. Albertson, 165 N. C. 218, 81 S. E. 168 (1914) 
 semble ; Longfellow v. Huffman, 49 Or. 486, 90 Pac. 907 (1907) ; iJriensky v. 
 Skonieczny, 209 111. App. 188 (1917). 
 
848 OPERATION OF CONTRACT (Ch, 4 
 
 solvency as an abrogation of the contract of August 28, 1875, and, 
 without giving any notice of their intention> not to perforni it, sold 
 their lumber on hand to other parties and ceased to buy more; and 
 when applied to ty M. F. Pardee and by the plaintiff to furnish the 
 lumber, refused to do so, and announced their intention nbt to furnish 
 any, assigning as reasons the failure of M. F; Pardee; that on learn- 
 ing it they had ceased buying, and had but little, and denying the 
 right of M. F. Pardee to assign the contract. There was no consent 
 on the: part either of M. F. Pardee or of the plaintiff to a rescission of 
 the contract ; on the contrary, they insisted on its performance, M. F. 
 Pardee offering guaranty of the payment of the price. . • 
 
 This action is not brought upon the contract for 1876, but for dam- 
 ages on the 153,495 feet shortage on the deliveries of 1875. As the 
 sale for 1876 was on 30 and 60 days' credit, the insolvency of M, F. 
 Pardee excused the defendants from delivering the lumber on credit, 
 and entitled them to insist upon payment on or before delivery, but it 
 did not abrogate the contract. On tender of the purchase price they 
 would have been bound, notwithstanding the insolvency, to deliver 
 the lumber to the vendee or his assignee. It is not necessary now to 
 consider what effect the conduct of the defendants in disabling them- 
 selves from performmg the contract, without giving any opportunity 
 to the purchaser to tender the price, and their absolute repudiation 
 of any liability to perform the contract, would have had in an action 
 on the contract for 1876. But it is quite clear that without some action 
 on their part to put the plaintiff or his assignee in default tor not ac- 
 cepting and paying for the lumber to be delivered under that contract, 
 the defendants cannot take the benefit of it as a defense to their lia- 
 bility under the previous contract for 1875. No such default was 
 shown. On the contrary, the referee found as matter' of fact that dur- 
 ing the season of 1876 the plaintiff was at all times able, ready, and 
 willing to receive and pay for the lumber according to the terms of 
 the contract of August 28, 1875. The defendants now seek to avail 
 themselves of the insolvency of M. F. Pardee, not only to exempt 
 themselves from liability for not delivering that lumber, but also to 
 receive the same advantage as though they had m fact delivered it. 
 This, we tTiink, is claiming too much. The mere insolvency of one 
 of the parties to a contract of sale is not equivalent either to a rescis- 
 sion or a breach. It simply relieves the vendor from his agreement to 
 give credit; and payment may be substituted. New England Iron 
 Co. V. Gilbert, etc., R. Co., 91 N. Y. 153; Add. Cont.,(Amer. Ed.) •g 
 471 ; Bing. Sales, (3d Amer. Ed.) § 759; Freeth v. Burr, L. R. 9 C. 
 P. 208 ; Bloomer v. Bernstein, Id. 588. But if the contract is rescind- 
 ed, neither party can retain or claim any benefit under it. 
 
 The order of the general term should be reversed, and the judgment 
 eiitered on the report of the referee afHrmed, with costs.* 
 
 « In .accord : Phenix Nat. Bank v. Waterbury, 197 N. Y, 166, 90 N. E. 435 
 (1910) ; Vandergrift v. Cowles Engineering lOo., 161 N. Y. 435, 55 N. B. 941, 48 
 
Sec. 6) IMPOSSIBILITY ' 849 
 
 ROSENTHAL PAPER CO. v. NATIONAL FOLDING BOX & 
 
 PAPER CO. 
 (Court of Appeals of New York, 1919. 226 N. ■!. 313, 123 N. E. 766.) 
 
 Action by the Rosenthal Paper Company against the National Fold- 
 ing Box & Paper Company. 
 
 CoivLiN, J.' ■ The action was for the recovery of royalties for the use 
 of a patent. Originally brought in the City Court of New York City, 
 the jury rendered a verdict for the plaintiff in the sum of $1,840.73. 
 The judgment of the City Court set the verdict aside, upon the ground 
 that it was contrary to law, and dismissed the complaint. The Appel- 
 late Term, upon the appeal of the plaintiff, reversed that judgment, 
 reinstated the verdict, and upon it rendered judgment for the plaintiff. 
 The Appellate Division, upon the appeal of the defendant, reversed 
 the determination of the Appellate Term, and affirmed the judgment 
 of the City Court. The Appellate Division permitted the appeal to 
 this court. 
 
 The action is based upon a contract in writing of March, 1909, be- 
 tween Isse Seligstein and the defendant. January 22, 1912, Seligstein 
 assigned to the plaintiff here the patent involved (and others), which 
 Seligstein held, not as the inventor, but as the assignee of the inventor, 
 and all of his "right, title, and interest in, to, and under" the contract 
 of March, 1909. Plaintiff instituted this action in virtue of the assign- 
 hient. The contents of the contract of March, 1909, may be adequately 
 stated as follows : 
 
 The ownership of Seligstein of letters patent for the milHnery or 
 suit box and the desire of the defendant to acquire the exclusive right 
 to manufacture and sell the box within a designated territory are re- 
 cited. Seligstein sells to the company the exclusive right to manu- 
 facture and sell the boxes under said patent within the territory, "upon 
 the following terms and conditions" : , 
 
 (1) The company "agrees to pay Seligstein a royalty of one dollar 
 ($1.00) per thousand boxes up to an average daily sale of twenty (20) 
 thousand boxes per day, per year of 300 days, and on all boxes sold in 
 excess of said twenty (20) thousand boxes per day, per year of 300 
 days, the said the National Folding Box & Pape;r Company agrees to 
 
 L. R. A. 685 (1900) ; In re Morgantown Tin Plate Co. (D. C.) 184 Fed. 109 
 (1911). 
 
 The receiver of an insolvent buyer cannot enforce the contract without 
 tendering payment in cash or ample security for payment at the times speci- 
 fied in the contract. Sprague, Warner & Ob. v. Iowa Mercantile Co. (Iowa) 
 172 N. W. 637 (1919) ; Hanna v. Florence Iron Co. of Wisconsin, 222 N. Y. 
 290, ,118 N. E. 629 (1918). 
 
 A voluntary assignment for the benefit of creditors may be accompanied 
 by such other facts as to justify the other party to the contract in construing 
 the whole as a repudiation. Hobbs v. Columbia Falls Brick Co., 157 Mass. 
 109, 31 N. E. 756 (1892) ; Ex parte Chalmers, L. R. 8 Oh. App. 289 (1873). 
 
 ' Part of the opinion is omitted. 
 CORBIN CoNT 54 
 
850 OPERATION OF CONTRACT (Ch. 4 
 
 pay a royalty of seventy-five cents (75c.) per thousand boxes, but it is 
 expressly understood that the payment by the said the National Folding 
 Box & Paper Company to said Seligstein for the right to manufacture 
 and sell boxes under said letters patent shall not be less than the sum 
 of five hundred dollars ($500.00) for each and every year during the 
 life of this contract. 
 
 "(2) The said Seligstein promises and agrees that he will faithfully 
 protect said letters patent from any and all substantial infringements 
 of said letters patent. 
 
 "(3) The said Seligstein further agrees that during the life of this 
 contract he will not sell within the territory, above described, any box 
 manufactured under said letters patent No. 906,138, nor any other 
 clothing, millinery, or suit box, and further that he will not during the 
 life of this contract sell any rights for any clothing, millinery, or suit 
 box to any one for the territory hereinbefore described. 
 
 "(4) The term of this contract shall be five (5) years from and after 
 the 1st day of March, A. D. 1909. * * *" 
 
 The defendant, through the period of five years, made and sold the 
 boxes, and regularly paid, quarter-annually, to Seligstein the royalty 
 of $1 per thousand boxes on all the boxes sold. Those paid royalties 
 aggregated $917.79. The minimtun aggregate royalty to be paid for 
 the five years was $2,500; that is, not less than $500 each year. This 
 action is to recover the sum of the diflference between those aggregates, 
 with interest. 
 
 The City Court set aside the verdict in favor of the plaintiff and dis- 
 missed the complaint upon the grounds: (a) Seligstein, by assigning 
 the patent, put it out of his power to perform his agreement to protect 
 the patent from any and all substantial infringements of the letters 
 patent, and, in consequence thereof, the defendant was released from 
 its agreement to pay the royalty; and (b) the defendant did not, by 
 paying royalty throughout the period, waive its right to assert such 
 release, because it did not know of the assignment of the patent until 
 the five years and the contract had expired. 
 
 The Appellate Term reversed the order and judgment of the City 
 Court, and reinstated and ordered judgment upon the verdict, upon 
 the ground that the defendant had the full benefit of the contract for 
 its entire period without molestation of any kind. 
 
 The Appellate Division reversed the determination of the Appellate 
 Term and affirmed the order of the City Court, upon the grounds : (a) 
 The agreement of the dfefendant to pay the minimum royalty and the 
 agreement of Seligstein to protect the patent were concurrent and de- 
 pendent. When Seligstein assigned the patent, he put it out of his 
 power to protect the patent (because the owner of the patent alone had 
 a standing to sue on account of an infringement), and therein and 
 thereby committed a breach of the contract which relieved the defend- 
 ant from the obligation of full performance on its part, (b) Defend- 
 
Sec. 6) IMPOSSIBILITY 851 
 
 ant did not waive this breach, because, in the first place, it was ignor- 
 ant of it, and, in the second place, plaintiff's complaint alleges full per- 
 formance by Seligstein of this agreement; and (c) the contract was 
 personal to Seligstein and unassignable. 
 
 We take up first the question whether or not the agreement of the 
 defendaiit to pay the minimum royalty and the agreements of Selig- 
 stein to protect the letters patent from substantial infringement, and 
 to refrain from selling, within the designated territory, any box manu- 
 factured under the patent, or any rights for any clothing, millinery, or 
 suit box to any one for the territory were dependent or independent of 
 each other. In Kingston v. Preston, cited at the bar in Jones v. Bark- 
 ley, 2 Douglas, 684, Lord Mansfield expressed himself to the following 
 effect : 
 
 "There are three kinds of covenants : (1) Such as are called mutual 
 and independent, where either party may recover damages from the 
 other, for the injury he may have received by a breach of the cove- 
 nants in his favor, and where it is no excuse for the defendant, to al- 
 lege a breach of the covenants on the part of the plaintiff. (2) There 
 are covenants which are conditions and dependent, in which the per- 
 formance of one depends on the prior performance of another, and 
 therefore, till this prior condition is performed, the other party is not 
 liable to an action on his covenant. (3) There is also a third sort of 
 covenants, which are mutual conditions to be performed at the same 
 time; and in these, if one party was ready and offered to perform his 
 part, and the other neglected or refused to perform his, he who was 
 ready, and offered, has fulfilled his engagement, and may maintain 
 an action for the default of the other; though it is not certain that 
 either is obliged to do the first act." 
 
 The complexities of modern industrial and commercial transactions 
 have not rendered. the classification inaccurate or inadequate. By a 
 long series of decisions, the rule has been established that the question 
 whether covenants are to be held dependent or independent of each oth- 
 er is to be determined by the intention and meaning of the parties, as 
 expressed by them, and by the application of common sense to each 
 case submitted for adjudication. Stavers v. Curling, 3 Bingham's N. 
 C. 355; Tipton v. Feitner, 20 N. Y. 423; Pollak v. Brush Electric 
 Association, 128 U. S. 446, 9 Sup. Ct. 119, 32 L. Ed. 474; Loud v. 
 Pomona Land & Water Co., 153 U. S. 564, 14 Sup. Ct. 928, 38 L- 
 Ed. 822; Griggs v. Moors, 168 Mass. 354, 47 N. E. 128; Leonard 
 V. Dyer, 26 Conn. 172, 68 Am. Dec. 382. The efforts put forth in 
 judicial opinions and by text-writers to define or formulate the dis- 
 tinctions of dependence and independence of promises or covenants 
 have revealed their comparative futility and served, in the main, 
 to strengthen the rule. Parties have the right to contract as they 
 will for any lawful purpose, and the problem for the courts is to 
 ascertain, in accordance with established rules of interpretation, the 
 
852 OPERATION OF CONTRACT (Ch. 4 
 
 real contract or agreement. If they make their promises dependent 
 or independent throughout, or dependent in part and independent in 
 part, it is not for the courts to thwart them. Their expressed in- 
 tention and meaning, ascertained from the whole instrument, rather 
 than from technical or conventional expressions, are the guides, 
 in determining the character and force of their respective, covenants. 
 
 In the contract under consideration the intention of the parties is 
 not obscure. They contemplated that the letters patent prohibited to 
 all persons except Seligstein, in the absence of his authorization, the 
 manufacture and sale or the manufacture or sale of any box incorpo- 
 rating the patented invention or inventions and that the contract se- 
 cured to the defendant the exclusive right, as against the whole world, 
 to manufacture and sell, within the prescribed territory, the box. This 
 exclusive right the defendant sought and Seligstein sold to it. The 
 continued exclusiveness of the right throughout the period of five years 
 was the root of the transaction. The defendant, presumably, could 
 not, in the intention of the parties, pay Seligstein for the right to 
 manufacture and sell a product which others, without price, were man- 
 ufacturing and selling. It was essential to the purpose of the contract 
 that the protection to and the exclusiveness of the right sold the de- 
 fendant should be coexistent or concurrent with its ownership of it, 
 and they were so created. The promises. of Seligstein were to be 
 kept and perfonned concurrently with those of the defendant. They 
 were) to be performed at all times during the licensed period. The 
 promises of the defendant were dependent or conditional upon those 
 of Seligstein. It is not reasoriable to presume that the defendant iu- 
 tended to pay for the exclusive right through the five years without 
 having it throughout the period. They intended that if it did not have 
 the right it should not pay for it. Performance by the defendant was 
 conditioned upon and subject to performance by Seligstein. The re- 
 ciprocal promises were therefore concurrent and dependent. * * * 
 
 The general rule exists that a covenant which goes to only a part 
 and not to the whole consideration of the contract is not a depend- 
 ent and is an independent covenant. Graves v. Legg, 9 Exch. R. 709. 
 It expresses one of the weighty considerations by which to deter- 
 mine whether covenants were intended as dependent or independent. 
 It is inferior, and submissive, however, to the rule that the expressed 
 intention of the parties is controlling. 
 
 When the promises of the parties are concurrent and dependent, 
 either party defaulting in performance cannot, in the course of per- 
 formance, sustain an action against the other because he has also 
 defaulted. Neither party can maintain the action until he has per- 
 formed or tendered performance of his part of the agreement. A 
 plaintiff must aver and prove performance, or a tender or waiver 
 of performance, or a fact excusing nonperformance. Dunham v. 
 Pettee, 8 N. Y. 508; Morris v. Sliter, 1 Denio, 59; Oakley v. Mor- 
 ton. 11 N. Y. 25, 62 Am. Dec. 49. 
 
Sec. 6) IMPOSSIBILITY 858 
 
 The instant case is, however, presented to us in such a condition 
 and form that those rules are not invocable to the defendant, as a 
 further statement of the facts will disclose. The five-year period of 
 the license contract expired on the last day of February, 1914. 
 Throtighout it, the defendant continuad to manufacture and sell the 
 boxes under the license' and pay the prescribed royalty of $1 per 
 thousand boxes. The defendant had not notice or knowledge of the 
 assignment of January 22, 1912, of Seligstein to the plaintiff, until 
 after the expiration of the license and the last payment of royalty, 
 or until after March 1, 1914. This action was commenced Feb- 
 ruary 4, 191§. Upon the trial the assignment of Seligstein to the 
 plaintiff was received in evidence, and the making of it and its legal 
 effect were the grounds of the decision of the City Court. There was 
 not, for the purpose of, or within, our consideration, an actual in- 
 fringement of the patent, or molestation or interference by infring- 
 ers or infringements, or by Seligstein or his assignee, of the pat- 
 ent, or of the defendant's exclusive licensed right. The defendant 
 had and enjoyed the whole interest or right Seligstein sold him. 
 
 We are to determine, under those facts, whether or not the sale 
 and assignment by Seligstein to the plaintiff, on January 22, 1912, of 
 his entire right, title, and interest in, to, and under the letters patent 
 and the contract between Seligstein and the defendant in and of itself 
 is a bar to this action. The sale and assignment by Seligstein put 
 it out of hfs power to perform his covenants. In virtue of them he 
 became a stranger to the patent and the contract. He conveyed to 
 the plaintiff the entire and unqualified monopoly which he held. As 
 to infringers and infringements of the patent, he became a person 
 without interest and remediless. Pope Manufacturmg Co. v. Gor- 
 miilly & I. Manufacturing Co., 144 U. S. 248, 12 Sup. Ct. 641. 36 
 L. Ed. 423 ; Uttlefield v. Perry, 21 Wall. 205, 22 L. Ed. 577. The 
 defendant, nevertheless, cannot have the aid of the doctrine that, 
 where a party to an executory contract puts it out of his power to 
 perform, as did Seligstein, the other party may regard the contract 
 as terminated and demand whatever damages he has sustained. Lov- 
 ell V. St. Louis Mutual Life Ins. Co., Ill U. S. 264, 274, 4 Sup. Ct. 
 390, 28 L. Ed. 423. The license contract ceased, by its terms and 
 execution, to be executory on the last day of February, 1914. While 
 the inexcusable breach of the contract by Sehgstein conferred upon 
 the defendant the right to terminate it while executory, the defend- 
 ant did not exercise the right. It used the license to the contracted 
 termination. The object of the agreement became fully performed. 
 
 Manifestly, the defendant could not, after^ the purpose and object 
 of the contract were accomplished, regard it as executory; it could 
 not rescind it; it could not deem itself deprived of the results ac- 
 cruing through the continuance of the contract and performance 
 upon its part ; it could only claim such damages, if any, as had been 
 caused by the breach. Where a party to an executory contract con- 
 
854 OPERATION OP CONTRACT (Ch. 4 
 
 taining mutual obligations, disables himself from performing it dur- 
 ing its performance, the other party has the option to treat the con- 
 tract as ended, so far as further performance is concerned, and 
 maintain an action at once for the damages occasioned by such an- 
 ticipatory breach, or to wait until there was to be final performance. 
 Ga Nun v. Palmer, 202 N. Y. 483, 96 N. E. 99, 36 h. R. A. (N. S.) 922 ; 
 Central Trust Co. of 111. v. Chicago Auditorium Ass'n, 240 U. S. 581, 
 589, 36 Sup. Ct. 412, 60 L. Ed. 811, h. R. A. 1917B, 580. The opinions 
 in those cases state that the rule has its exceptions. The other party 
 may, however, decline to deem the contract terminated and may in- 
 sist that it shall continue in force up to the time fixed for its final 
 performance. A contract thus kept alive exists for the benefit of 
 both parties. The party who refuses to regard it as terminated by 
 the breach remains liable to all his obligations and liabilities under 
 it. Frost V. Knight, L. R. 7 Exch. HI; Howard v. Daly, 61 N. Y. 
 362, 19 Am. Rep. 285 ; Bernstein v. Meech, 130 N. Y. 354, 29 N. E. 
 255; Johnstone v. Milling, E. R. 16 Q. B. D. 460; Lake Shore & 
 Michigan Southern Railway Co. v. Richards, 152 111. 59, 80, 38 N. E. 
 773, 30 E. R. A. 33 ; Roehm v. Horst, 178 U. S. 1, 20 Sup. Ct. 780, 
 44 L. Ed. 953. 
 
 This doctrine also has its exceptions, none of which is relevant 
 here. The action of Seligstein left. the defendant free to continue 
 as it did in the performance of the contract. The absence of no- 
 tice to or knowledge of the defendant that Seligstein had assigned the 
 contract does not affect the rights of the parties as presented to us. 
 Seligstein did not violate a legal obligation or duty in keeping it un- 
 known to the defendant. 
 
 By the terms of the contract the right of the defendant to manu- 
 facture and sell the boxes and its obligation to pay the rated or min- 
 imum royalty were conditioned upon the agreements of Sfeligstein 
 and his performance of them. Seligstein's action gave it the option 
 to cease performance and recover damages. It did not give it the 
 option to manufacture and sell, and not pay the royalties. It manu- 
 factured and sold, and thus nullified the conditional quality of Selig- 
 stein's promises. Having kept alive the contract and secured the 
 results, it cannot maintain that it is not subject to its obligations and 
 liabilities, for the reason that Seligstein had renounced it. Its reme- 
 dy is the recovery, in counterclaim or action, of the damages, if any, 
 Seligstein's action or nonperformance caused it. 
 
 [The court then held that the assignment by Seligstein to the 
 plaintiff of his rights against the defendant was a valid assignment, 
 in spite of the fact that he had personal duties that were not assign- 
 able.] 
 
 Judgment reversed. 
 
Sec. 6) ■ IMPOSSIBILITY 855 
 
 FARGO, et al. v. WADE. 
 (Supreme Court of Oregon, 1914. 72 Or. 477, 142 Pac. 830, L. E. A. 1915A, 271.) 
 
 Action by George K. Fargo and another against W. T. Wade. From 
 a judgment for plaintiffs, defendant appeals. Affirmed. 
 
 This is an action to recover money. The facts as far as material 
 herein are that on January 3, 1910, a written agreement was entered 
 into whereby Fred Ewing, who was then the owner, in fee of 917.24 
 acres of land in Wallowa county, Or., gave the defendant the right 
 at any time, within five years, to purchase the premises, in considera- 
 tion for which $150 was paid in advance, and Wade also stipulated 
 to pay a like sum for the years 1911 and 1912 and $250 per annum 
 for the remaining years, unless the election to pay for the real property 
 was sooner exercised. At the time the agreement was concluded 
 the land was leased to G. W. Harvey for a term extending beyond 
 the limit of the option. In referring to such demise the contract 
 contained a clause which reads: "This agreement is subject to the 
 terms and conditions of said lease, but it is further understood and 
 c^reed that said party of the first part [Ewing] shall faithfully per- 
 form all the conditions of said lease upon his part to be performed." 
 
 The installments on account of the option were paid to January 
 3, 1912. Prior thereto, however, Ewing sold and conveyed tiie land 
 to the plaintiffs, to whom he also assigned all his interest in the option. 
 Insisting that such conveyance constituted a breach of the terms of the 
 written agreement. Wade refused to pay the installment of $150, which 
 matured January 3, 1913, whereupon this action was instituted. The 
 complaint sets forth the substance of the contract, alleges the convey- 
 ance of the land, the assignment of the written agreement, and the 
 default in the payment of the installment. The answer denies some 
 of the material averments of the complaint. For a further defense 
 and as a counterclaim it is averred, in effect, that the defendant had 
 at all times been ready, a:ble, and willing to pay the installments as 
 they matured, but that Ewing had fa,iled and refused to carry out 
 the terms of the lease executed to Harvey, and neglected to make the 
 improvements provided for in that demise. A copy of the option 
 contract is made a part of the separate answer. A motion to strike 
 out the latter defense was sustained, and the cause, being tried on the 
 remaining issues, resulted in a judgment for the plaintiffs in the sum of 
 $150, and the defendant appeals. 
 
 Moore, J." (after stating the facts as above). The important ques- 
 tion to be considered is whether the conveyance of the land to the 
 plaintiffs constituted such a breach of Ewing's agreement as to pre- 
 vent a recovery of- any of the remaining installments. The contract, 
 is a mere option whereby the defendant, for a valuable consideration 
 secured the right to elect whether he would, within the time limited, 
 
 * One paragraph of the opinion is omitted. 
 
856 OPERATION OF CONTI^ACT (Ch. 4 
 
 pay for the real property the price stated. 21 Am. & Eng. Ency. 
 Law (2d Ed.) 924; 39 Cyc. 1232; Friendly v. Elwert, 57 Or. 599, 
 105 Pac. 404, 111 Pac. 690, 112 Pac. 1085, Ann. Cas. 1913A, 357. In 
 Ide V. Leiser, 10 Mont. 5, 11, 24 Pac. 695, 24 Am. St. Rep. 17, in 
 referring to an option to buy real property, it is said : "The owner, 
 parts with his right to sell his lands (except to the second party) for 
 a limited period." In that case the only question involved was wheth- 
 er or not a consideration had been given for extending the time within 
 which the election could be exercised. What was said in the opinion 
 in respect to the owner of real property, who had parted with his 
 right to sell the land "except to the second party," must be regarded 
 as a mere observation. 
 
 In Elliott v. Delaney, 217 Mo. 14, 116 S. W. 494, however, it was 
 held that the owners of real property who, for a valuable considera- 
 tion, had given an option to convey the land, had the right, prior to 
 the expiration of the limit specified, to execute a deed of the prepiises 
 to a third party who took the title subject to the incumbrance. * * * 
 
 Another case cited in support of the dictum in the case of Ide v. 
 Leiser, 10 Mont. 5, 24 Pac. 695, 24 Am. St. Rep. 17, is Krebs Hop 
 Co. v. Livesley, 51 Or. 527, 533, 92 Pac. 1084, where it was held that 
 if, before the time for performance of an executory contract had ar- 
 rived, one of the parties to the agreement made it impossible for him to 
 comply with his part of the engagement, the other might treat the con- 
 tract as terminated and proceed accordingly; but in order to justify 
 such a course there must have been a failure in some substantial 
 particular going to the essence of the agreement, thereby rendering the 
 defaulting party incapable of discharging his undertaking and mak- 
 ing it impossible to carry out the contract. In that case the plaintiif 
 had engaged to grow on a particular tract of land hops which were to 
 be delivered to the defendant, but prior to the times for performance 
 the plaintiff, conveyed the real property and assigned the sums of 
 money to become due under the contract to a creditor as security, and 
 it was determined that notwithstanding such transfers it was possible 
 for the plaintiff to perform. 
 
 It is believed that the decisions rendered in these cases are not 
 determinative of the question here involved. The principle contended 
 for by defendant's counsel, if upheld, might result in defeating every 
 option for the purchase of real property the value of which had in- 
 creased after the right to buy the premises had been given. In this 
 state there is no statute prohibiting the alienation of land, and when 
 an option to purchase any real property has been given, the owner of 
 the premises has an estate therein which he can transfer, and the party 
 accepting the title, if he has notice or knowledge of the privilege con- 
 ferred by the writing, necessarily takes the premises cum onere. An 
 option. given by the owner of land for a valuable consideration, agreeing 
 to sell it to another at a fixed price if accepted within a specified time, 
 is binding upon the owner and all his successors in interest with knowl- 
 
Sec. 6) IMPOSSIBILITY 857 
 
 edge thereof. Mueller v. Nortmann, 116 Wis. 468, 93 N. W. 538, 96 
 Am. St. Rep. 997. At any time prior to the expiration of the time limit- 
 ed. Wade could have relinquished his right to purchase the land, and, 
 had he done so, no recovery of any sum of money subsequently accruing 
 could have been had against him. . He cannot, however, .insist upon 
 a continuation of the validity of the option without being liable for 
 the installments maturing thereon. If the real property was thus 
 obtained burdened with the option, all the advantages accruing to 
 the vendor from the contract, including the right to receive and col- 
 lect the installments maturing on account thereof, should also be 
 transferred, particularly so when they were expressly assigned for 
 that purpose. 
 
 It appears from the evidence that during the greater part of the 
 year 1912, when the installment accrued for which the judgment 
 herein was given Ewing remained the owner of the land. It will be 
 remembered that he covenanted in the option contract faithfully to per- 
 form all the conditions that he had undertaken in the lease of the prem- 
 ises to Harvey. It will also be kept in mind that the part of the answer 
 which was stricken out averred that Ewing had failed and refused to 
 make upon the land the improvements specified in the lease. The 
 plaintiffs by an assignment of the installments took choses in action 
 subject to all existing equities, and any defense available against 
 Ewing, had he commenced an action therefor, might have been inter- 
 posed herein. That part of the answer referred to does not allege 
 that Ewing's refusal to make upon the land the improvements specified 
 in the lease to Harvey would have augmented the defendant's inter- 
 est in the premises or inured to his advantage, nor is it averred that 
 in consequence of such failure he sustained any damage. The further 
 answer, therefore, did not state facts sufficient to constitute a defense, 
 and no error was committed in striking it out, though possibly a 
 demurrer thereto, based on that ground, would have been better prac- 
 tice. 
 
 Other errors are assigned, but, deeming them immaterial, the judg- 
 ment is affirmed.* 
 
 »Cf. James v. Burehell, 82 N. Y. 108 (1880). 
 
 In the case of a contract for the future conveyance or delivery of land or 
 goods, the buyer's duty to pay is not nullified by the fact that the seller 
 owned neither land nor goods at the time the contract was made. Such ab- 
 sence of ownership is not impossibility. HibWewhite v. McMorine, 5 M. & W. 
 .462 (1839) ; Shales v. Seignoret, 1 Ld. Raym. 440 (1699) ; Thompson v. 
 Hoppert, 120 111. App. 588, 593, (1905). 
 
 But a conveyance of the subject-matter by the vendor to an innocent pur- 
 chaser for value operates both to excuse tender by the vendee as a condition 
 precedent and as an immediate breach of contract by the vendor. See Bell v. 
 Shields, 18 Idaho, 649, 111 Pac. 1076 (1910). 
 
 In Coonan v. City of Cape Girardeau, 149 Mo. App. 609, 620, 129 S. W. 745 
 (1910), the court said: "Plaintiff believed, and perhaps had reasonable cause 
 to believe, the city wpuld be unable to carry out its part of the contract ; that 
 Is to say, would be unable promptly to furnish a right of way for the sewer 
 system and in consequence he might sustain loss ; but this was by no means 
 
858 OPERATION OF CONTRACT (Ch. 4 
 
 MARY SHORT v. STONE. 
 (In the Queen's Bench, 1846. 8 Q. B. 358.) 
 
 Assumpsit. The declaration stated that heretofore, to wit, on, 
 etc., "in consideration that the plaintifif, being then unmarried, at the 
 request of the defendant, had then promised the defendant to marry 
 him, the defendant, he, the defendant, then promised the plaintiff 
 to marry her within a reasonable time next after he should be there- 
 unto requested by the plaintiff so to do ; and the plaintiff avers that 
 she, confiding in the said promise of the defendant, hath always hith- 
 erto remained and continued, and still is, sole and unmarried, and 
 was always, from the time of the making of her said promise until 
 the marriage of the said defendant as hereinafter mentioned, ready 
 and vvilling to marry the defendant, whereof the defendant hath al- 
 ways had notice; yet the defendant, disregarding his said promise, 
 after the making thereof and before the commencement of this suit, 
 to wit, on," etc., "wrongfully and injuriously married a certain oth- 
 er person, to wit, one Edith Collins, contrary to his said promise: 
 to the damage," etc. 
 
 Plea 2. "Defendant says that he was not at any time before the 
 commencement of this suit requested by the plaintiff to marry her 
 according to his said promise in that behalf." Verification. 
 
 Demurrer, assigning for causes, among others, that the plea con- 
 fesses, but does not sufficiently avoid, and defendant has therein al- 
 leged a fact wholly immaterial to the merits; "for, inasmuch as it 
 appears by the declaration that the defendant, before the commence- 
 ment of this suit, had married another person, the plaintiff need not 
 nor ought not to have requested the defendant to marry her." Al- 
 so, that the plea "tenders too large and an insufficient issue, to wit, 
 whether a request were made before the commencement of this suit ; 
 whereas, if the request be material at all, it should have been alleged 
 not to have been made before the marriage of the defendant ; for if 
 the plaintiff were to traverse the allegation as it now stands in the 
 said plea, and the same should be found for her, still it would not 
 show conclusively that she was' and is entitled to maintain her ac- 
 tion, as it would be consistent with the said issue, and verdict there- 
 on, that the request found to have been made by the plaintiff was 
 after the said marriage, and between it and the commencement of 
 this suit." Also that the plea should have concluded to the country. 
 
 Joinder in demurrer. 
 
 certain, and the law does not relieve a man from a contractual obligation 
 because he believes with good cause the person with whom he has contracted 
 will not be able to i)erform." In accord: Gooch v. Coleman, 22 N. M. 45, 
 159 Pac. 945 (1916) ; Brady v. Oliver, 125 Tenn. 596, 147 S. W. 1135, 41 L. K. 
 A (N. S.) 60, Ann. Cas. 1913C, 376 (1911). 
 
Sec. 6) iMPOSSiBiLiTT 859 
 
 Lord DiENMAN, C. J.^" We must look at this case with a view 
 to the feehngs and intentions of the parties at the time of enter- 
 ing into such a contract; and the intention clearly is, to marry in 
 the state in which the parties respectively are at the time. If either 
 party puts himself out of that state, he must be taken to dispense 
 with the contract so far that the other may have an action against 
 him without a request to marry. It is unnecessary to inquire what 
 cases, among those which have been mentioned, are analogous to 
 this, because here the intent must be considered; and, looking to 
 that, the fact stated on the record is a necessary dispensation. Ac- 
 cording to this, which appears to me the true construction of the 
 contract, the plaintiff shows a good right of action, and is entitled 
 to judgment. 
 
 Judgment for plaintiff.^^ 
 
 BURK et al. v. SCHREIBER. 
 
 (Supreme Judicial Court of Massachusetts, 1903. 183 Mass. 35, 66 N. B. 411.) 
 
 Action by Burk and others against Schreiber. There was a ver- 
 dict for plaintiffs, and, the case was reported. Judgment on the verdict. 
 Knowlton, C. J. There is no dispute that, by the terms of her con- 
 tract, the defendant was bound to give the plaintiffs a deed which 
 would convey a good title. The time for the delivery of the deed 
 and the payment of the balance of the price was extended three times, 
 for a period of 12 days in all, and on the last day appointed it ap- 
 peared that there was an attachment upon the property which was 
 outstanding and undischarged. The defendant's attorney submit- 
 ■ ted a paper of recent date which purported to release the attachment, 
 signed by the attorney of record of the attaching creditor. The at- 
 
 ^o The argument of counsel and the cdncurring opinions of Patteson, Cole- 
 ridge, and Wightman, JJ., are omitted. 
 
 1^ Where, prior to the time set for performance or after such time has ar- 
 rived, the defendant makes performance by himself impossible, this operates 
 as a repudiation by the defendant; the plaintiff has an immediate right to 
 damages without performance on his own part and is himself freed from 
 further duty. Sir Anthony Mayne's Case, 5 Co. Rep. 20 b (1596) ; Lovelock 
 v.Franklyn, 8 Q. B. 371 (1846) ; Caines v. Smith, 15 M. & W. 189 (1846) ; 
 Ogdens Ltd. v. Nelson, [1905] A. C. 109; Central Trust Co. of Illinois v. 
 Chicago Auditorium Ass'-n, 240 U. S. 581, 36 Sup. Ct. 412, 60 L. Ed. 811, L. 
 R. A. 1917B, 580 (1916), bankruptcy; In re MuUings Clothing Co., 238 Fed. 
 58, 151 C. C. A. 134, L. R. A. 1918A, 539 (1917), same; Lang v. Hedenberg, 
 277 111. 36^, 115 N. E. 566 (1917) ; Wm. Cramp & Sons Ship & Engine Build- 
 ing Co. V. U. S., 50 Ct. CI. 179 (1915) ; Meyers v. Markham, 90 Minn. 230, 
 96 N. W. 335, 787 (1903) ; James v. Burchell, 82 N. Y. 108 (1880) ; Delama- 
 ter V. Miller, 1 Cow. (N. T.) 75, 13 Am. Dec. 512 (1823) ; In re Swift, 112 
 Fed. 315, 50 C. O. A. 264 (1901). 
 
 The prospective inability of one party to perform on time does not excuse 
 the other from performing, in case time is not of the essence. Holt v. United 
 Security Life Ins. Co., 76 N. J. Law, 585, 72 Atl. 301, 21 L. R. A. (N. S.) 
 691 (1908). 
 
860 OPERATION OF CONTRACT (Ch. 4 
 
 taching creditor had deceased nearly four months before, and no 
 administrator had been appointed. The plaintiffs then declined to 
 accept the deed tendered by the defendant, and declined the defend- 
 ant's offer to procure a discharge of the attachment as soon as pos- 
 sible. They bring this action, not to recover damages for the breach 
 of the defendant's contract, but to recover back a part of the pur- 
 chase money previously advanced at the time of the auction sale. 
 
 The plaintiffs were not bound either to accept the deed while 
 there was an incumbrance on the property, or to wait to see whether 
 the defendant would procure a release of the attachment after the 
 appointment of an administrator, or give a bond, with sureties, to 
 dissolve the attachment. The defendant was unable to perform 
 her contract according to its terms, and the plaintiffs, insisting on a 
 performance, had a right to rescind it and recover back their pay- 
 ment, as money had and received to their use. They were not obliged 
 to tender performance, or to make a formal offer of performance. 
 The inability of the defendant to perform gave them a right to re- 
 scind. Swan V. Drury, 22 Pick. 485; Pickman vi Trinity Church, 
 123 Mass. 1-6, 25 Am. Rep. 1 ; Mead v. Fox, 6 Cush. 199 ; Callaghan 
 V. O'Brien, 136 Mass. 378; Gormley v. Kyle, 137 Mass. 189; Rich- 
 mond V. Gray, 3 Allen, 25; Jeffries v. Jeffries, 117 Mass. 187. The 
 plaintiffs may recover their advance payment on the ground that 
 the contract ha* ceased to be in effect, and that the money is held 
 without consideration. 
 
 Judgment on the verdict. 
 
 ZIEHEN v. SMITH. 
 (Court of Appeals of New york, 1896. 148 N. T. 558, 42 N. E. 1080.) 
 
 Action by William Ziehen against David J. Smith and John H. 
 Smith for breach of contract. The complaint was dismissed on the 
 trial, as to John H. Smith. From a judgment of the general term (73 
 Hun, 571, 26 N. Y. Supp. 419) affirming a judgment entered on a ver- 
 dict for plaintiff, and an order denying a new' trial (2 Misc. Rep. 487,. 
 24 N. Y. Supp. 922), defendant appeals. Reversed. 
 
 O'Brien, J. The plaintiff, as Vendee,' under an executory contract 
 ' for the sale of real estate, has recovered of the defendant, the vendor, 
 damages for a breach of the contract to convey, to the extent of that 
 p?rt of the purchase money paid at the execution of the contract, and 
 for certain expenses in the examination of the title. The question pre- 
 sented by the record is whether the plaintiff established at the trial such, 
 a breach of the contract as entitled him to recover. By the contract, 
 which bears date August 10, 1892, the defendant agreed to convey to 
 the plaintiff, by good and sufficient deed, the lands' described therein, 
 being a country hotel with some adjacent land. The plaintiff was to 
 pay for the same the sum of $3,500, as follows : $500 down, which was- 
 
Sec. 6) IMPOSSIBILITY 8G1 
 
 paid at the time of the execution of the contract; $300 more on the 
 15th day of September, 1892. He was to assume an existing mortgage 
 on the property of $1,000, and the balance, of $1,700, he was to secure 
 by his bond and mortgage on the property, payable, with interest, one 
 year after date. The courts below have assumed that the payment of 
 the $300 by the plaintiff, the execution of the bond and mortgage, and 
 the delivery of the conveyance by the defendant, were intended to be 
 concurrent acts, and therefore the day designated by the contract for 
 mutual performance was the 15th of September, 1892. 
 
 Since no other day is mentioned in the contract for the payment of 
 the money or the exchange of the papers, we think that this construc- 
 tion was just and reasonable, and in fact the only legal inference of 
 which the language of the instrument was capable. It is not al- 
 leged or claimed that the plaintiff on that day, or at any other 
 time, offered to perform on his part, or demanded performance on 
 the part of the defendant; and this presents the serious question 
 in the case, and the only obstacle to the plaintiff's recovery. It 
 is, no doubt, the general rule that, in order to entitle a party to re- 
 cover damages for the breach of an executory contract of this charac- 
 ter, he must show performance, or tender of performance, on his part. " 
 He must show in some way that the other party is in default, in order 
 to maintain the action, or that performance or tender has been waived. 
 But a tender of performance on the part of the vendee is dispensed 
 with in a case where it appears that the vendor has disabled himself 
 from performance, or that he is on the day fixed by the contract for 
 that purpose, for any reason, unable to perform. The judgment in 
 this case must stand, if at all, upon the ground that on the 15th day of 
 September, 1892, the defendant was unable to give, to the plaintiff any 
 title to the property embraced in the contract; and hence any tender 
 of performance on'the part of the plaintiff, or demand of performance 
 on his part, was unnecessary, because, upon the facts appearing, it 
 would be an idle or useless ceremony. 
 
 It appeared upon the trial that at the time of the execution of the 
 contract there was another mortgage Upon the premises of $1,500, 
 which fact was not disclosed to the plaintiff, and of the existence of 
 which he was then ignorant. That on or prior to the 21st of July, 
 1892, some 20 days before the contract was entered into, an action was 
 commenced to foreclose this mortgage, and notice of the pendency of 
 the action filed in the county clerk's office; that on the 30th of Sep- 
 tember, following, judgment of foreclosure was granted, and entered 
 on the 31st of October, thereafter, and on the 28th of December the 
 property was sold to a third party by virtue of the judgment, and duly 
 conveyed by deed from the referee. It appears that the defendant was 
 not the maker of this mortgage, and was not aware of its existence, 
 blit it was made by a former owner, and the defendant's title was sub- 
 ject to it when he contracted to sell the property to the plaintiff. The 
 decisions on the point ipvolved do not seem to be entirely harmonious. 
 
8G2 OPERATION OF CONTRACT (Ch. 4 
 
 In some of them it is said that the existence, at the date fixed for per- 
 formance, of liens or incumbrances upon the property, is sufficient to 
 sustain an action by the vendee to recover the part of the purchase 
 money paid upon the contract. Morange v. Morris, *42 N. Y. 48; 
 Ingalls V. Hahn, 47 Hun, 104. 
 
 The general rule, however, to be deduced from an examination of 
 the leading authorities, seems to be that in cases where, by the terms 
 of the contract, the acts of the parties are to be concurrent, it is the 
 duty of him who seeks to maintain an action for a breach of the con- 
 tract, either by way of damages for the nonperformance, or for the 
 recovery of money paid thereon, not only to be ready and willing to 
 perform on his part, but he must demand performance from the other 
 party. The qualifications to this rule are to be found in cases where 
 the necessity of a formal tender or demand is obviated by the acts of 
 the party sought to be charged, as by his express refusal in advance to 
 comply with the terms of the contract in that respect, or where it ap- 
 pears that he has placed himself in a position in which performance is 
 impossible. If the vendor of real estate, under an executory con- 
 tract, is unable to perform on his part, at the time provided by the con- 
 tract, a formal tender or demand on the part of the vendee is not nec- 
 essary in order to enable him to maintain an action to recover the 
 money paid on the contract, or for damages. Hudson v. Swift, 20 
 Johns. 24; Fuller v. Hubbard, 6 Cow. 13, 16 Am. Dec. 423; Green v. 
 Green, 9 Cow. 47 ; Hartley v. James, 50 N. Y. 38 ; Bigler v. Morgan, 
 77 N. Y. 312; Burwell v. Jackson, 9 N. Y. 547; Bogardus v. Insurance 
 Co., 101 N. Y. 328, 4 N. E. 522; Tamsen v. Schaefer, 108 N. Y. 604, 
 IS N. E. 731. 
 
 In this case there was no proof that the defendant waived tender or 
 demand, either by words or conduct. The only difficulty in the way 
 of the performance on his part was the existence of the mortgage, 
 which the proof tends to show was given by a former owner, and its 
 existence on the day of performance was not known to either party. 
 In order to sustain the judgment, we must hold that the defendant, on 
 the day of performance, was unable to convey to the plaintiff the tide 
 which the contract required, simply because of the existence of the 
 incumbrance. We do not think that it can be said, upon the facts of 
 this case, that the defendant had placed himself in such a position that 
 he was unable to perform the contract on his part, and that his title 
 was destroyed, or that it was impossible for him to convey, within the 
 meaning of the rule which dispenses with the necessity of tender and 
 demand in order to work a breach of an executory contract for the sale 
 of land. It cannot be affirmed, under the circumstances, that, if the 
 plaintiff had made the tender and demand on the day provided in the 
 contract, he would not have received the title which the defendant 
 had contracted to convey. The contract is not broken by the mere 
 fact of the existence on the day of performance of some lien or in- 
 
Sec. 6) IMPOSSIBILITY 863 ■ 
 
 cumbrance which it is in the power of the vendee to remove. That 
 is all that was shown in this case, and hence the judgment was re- 
 covered in violation of an important principle of the law governing con- 
 tracts. For this reason the judgment should be reversed, and a new 
 trial granted; costs to abide the event. All concur. Judgment re- 
 versed.-^^ 
 
 JINNINGS V. AMEND et al. 
 
 (Supreme C!ourt of Kansas, 1917. 101 Kan. 130, 165 Pac. 845, L. E. A. 
 
 1917F, 626.) 
 
 Action of forcible entry and detainer by T. M. Jinnings against 
 W. Al Amend and others. Judgment for plaintiff, and defendants 
 appeal. Reversed, and cause remanded. 
 
 Mason, J. W. A. and E. R. Amend, residents of Great Bend, were 
 the owners of 960 acres of land in Gray county. In February, 1915, 
 they entered into a written agreement with T. M. Jinnings, providing 
 that he was to occupy and farm it for three years, one-third of the 
 crop (wheat) to go to the owners. The contract also provided for 
 his breaking out 500 acres of new land the first year and raising a 
 wheat crop thereon for the benefit of the owners, to be paid in cash 
 for his services in this connection. By September 28, 1915, Jinnings 
 had broken the 500 acres of sod and plowed 400 acres of cultivated 
 land, but had not sowed any wheat. On that day he was arrested, 
 charged with a felony. He was held .in custody until the October 
 term of the district court, when he was convicted and sentenced to 
 serve six months in Ihe county jail. He appears not to have at- 
 tempted to make any arrangement for the carrying on of the work, 
 and to have been out of funds and credit. He remained in jail until 
 about March 1, 1916, when he was paroled. Within a day or two after 
 the arrest the Amends took possession of the land, which they have 
 ever since retained. Upon the parole of Jinnings they told him that 
 they would not permit him to return to the premises. On April 11, 
 1916, he brought an action of forcible entry and detainer against 
 them, joining as a defendant John Ratzloff, to whom they had given 
 a lease. By the consent of the parties the case was transferred to 
 the district court under an agreement that all the matters in con- 
 troversy should be determined in one action. A referee heard the 
 evidence and made detailed findings covering all transactions con- 
 nected with the land contract. Judgment was rendered, awarding 
 the plaintiflF possession of the land, and requiring him to pay $1,859.- 
 10, the amount found due the Amends on an accounting. The de- 
 fendants appeal. 
 
 12 In accord : Brickies v. Snell, [lSl6] 2 A. C. 599 ; Ward v. James, 84 Or. 
 .375, 164 Pac. 370 (1917) ; Smith v. Howard, 32 Ky. Law Rep. 211, 105 S. W. 
 411 (1907) ; Wliitney v. Crouch, 105 Misc. Bep. 268, 172 N. X. Supp. 729 
 (1918). 
 
"864 OPERATION OF GONTEACT (Ch. 4 
 
 The plaintiff invokes the rule that, in the absence of an express 
 provision on the subject in the lease, a lessor cannot terminate the 
 tenancy on account of a breach of covenants by the lessee. 18 A. 
 & E. Encyc. of E. 369, 370; 24 Cyc. 1349; 24 Cyc. 1392; 16 R. C. 
 L. 969; 16 R. C. L. 1115. He contends that the written contract 
 was a lease, creating the ordinary relation of landlord and tenant, and 
 that, inasmuch as it contained no provision for a forfeiture no fail- 
 ure to perform the agreements on his part could give the defendants 
 a right of re-entry. The 'defendants maintain that, if the contract 
 was a lease at all, it was not an ordinary one ; that it was more in the 
 nature of a "cropper's" agreement for the cultivation of land on 
 shares, and that an essential part of it was the plaintiff's undertaking 
 to perform personal services; that when, by his own misconduct, 
 he was disabled from carrying out a material part of the agreement 
 he had undertaken, they were at liberty to rescind the contract, set- 
 tling with him on an equitable basis for what he had already done. 
 
 The contract used language appropriate tO' a lease; it purported 
 to create a tenancy for three years. That consideration, however, 
 is not necessarily controlling, as the effect of the instrument is to 
 be determined from its real intent, as gathered from its entire con- 
 tents, regardless of the technical words used. 16 R. C. L. 584. It 
 included clauses reserving a right to the owners to go upon the place 
 at all times, requiring the plaintiff to pay the defendants one-third 
 of any receipts for pasturing cattle on the wheat, and providing for 
 a delivery of possession in case of a sale, compensation to be made 
 for the growing crop. We do not consider it necessary to decide 
 what expression most fitly describes the relationship into which the 
 parties entered. There is nothing peculiar about a lease that takes 
 it out of the operation of the rules of fair dealing that govern in oth- 
 er contractual relations. Here the essence of the arrangement was 
 that the defendants were to furnish the land and certain implements, 
 material, and money, and the plaintiff was to furnish his care, skill, 
 and labor, and the proceeds were to be divided. Although the con- 
 tract may be said to have created an estate in the land, it was es- 
 sentially executory; its provisions were mutually dependent. The 
 plaintiff was not in control of the land, to use it at his pleasure. He 
 was bound to handle it in a stated way, and to perform certain acts 
 with regard to it, and these obligations were as important as any 
 other part of the contract. His personal services were engaged ; his 
 skill as a farmer was involved ; he had no power of substitution or 
 subletting. See, in this connection, Randall v. Chubb, 46 Mich. 311, 
 9 N. W. 429, 41 Am. Rep. 165 and Myer v. Roberts, 50 Or. 81, 89 
 Pac. 1051, 12 E. R. A. (N. S.) 194, 126 Am. St. Rep. 733, 15 Ann. Cas. 
 1031. Notwithstanding the absence of any reference in the con- 
 tract to a right of re-entry, it cannot be doubted that if he had com- 
 pletely abandoned the place, or had utterly refused compliance with 
 the agreement, the owners would not have been required to permit 
 
Sec. 6) IMPOSSIBILITY 8G5 
 
 the land to remain idle for several years. A clause of the agreement 
 gave them a right to furnish additional help in the management of 
 the farm, at the charge of the plaintiff, if thought by them to be nec- 
 essary. But this cannot be regarded as an exclusive remedy. It is 
 not adapted to such a situation as that suggested; nor were the de- 
 fendants bound to pursue it. 
 
 The matter to be determined is the effect upon the relations of the 
 parties of the plaintiff having been arrested, convicted, and confined. 
 There seems to be a dearth of cases bearing upon that question. In 
 Leopold V. Salkey, 89 111. 412, annotated in 31 Am. Rep. 100, an em- 
 ployer was held to have the right to discharge an employe who had 
 been hired for a fixed period, because of his being arrested and held 
 in custody for two weeks. That contract was perhaps not closely 
 analogous to the one now under coVisideration. Moreover, the loss 
 of time was treated as one for which the person arrested was not to 
 blame, so that the principle applied would not be particularly helpful 
 here. The gravity of the charge of which the plaintiff was convicted 
 indicates' that it impHed moral turpitude. While the doctrine of res 
 •judicata has no application, we must act upon the theory that the 
 conviction was rightful. It cannot be assumed that a miscarriage of 
 justice occurred, nor could an inquiry into that niatter be permitted, 
 where it is collaterally involved in civil litigation. Burt v. Union 
 Central Life Insurance Co., 187 U. S. 362, 23 Sup. Ct. 139, 47 L. Ed. 
 216. This situation is therefore presented: The plaintiff, having 
 obtained possession of the land under a three-year contract, a ma- 
 terial part of the consideration being that he should put in a wheat 
 crop in the fall of 1915, was disabled to perform his agreement in 
 that respect (as well as in some others) by reason of his having com- 
 mitted a crime. The disability was self-imposed. He was entitled 
 to no more favorable treatment than if he had purposely interposed 
 an insurmountable obstacle to the carrying out of the contract, or 
 had abandoned or repudiated it.^^ * * * 
 
 The right of the plaintiff to occupy the land for three years was 
 expressly granted in consideration of his personal occupancy and 
 services. By fair implication it was conditioned upon his being able 
 
 13 The court here quoted as follows : "Where one of the parties to a con- 
 tract, before the time for performance arrives, has placed himself, by his 
 Toluntary act or conduct, in such a situation that he is unable to fulfill his 
 part of the agreement, it may be treated as an anticipatory breach of the 
 contract, or as a case of impossibility of performance subsequently arising ; 
 and in either view the other party to the contract may thereupon rescind it, 
 and recover whatever consideration he may have given under it, or treat it 
 as abandoned, and sue at once for such damages as he may have sustained. 
 The inability to perform need not relate to the whole and every part of the 
 contract, but it must exist with reference to some substantial particular, going 
 to the very essence of the contract and defeating it-s main purpose and object, 
 or to a part so essential to the residue of the contract that it cannot reason- 
 ably be supposed that the other party would hav6 made the contract without 
 it." 1 Black on Rescission and Cancellation, § 210. 
 
 COBBIN CONT 55 1 
 
866 OPERATION OF CONTRACT (Ch. 4 
 
 to comply with that requirement — at least upon his not voluntarily 
 divesting himself of such ability. His enforced withdrawal from 
 active life was not within the contemplation of the parties to the 
 contract. There was practically a destruction of an important part 
 of the subject-matter of the contract. The fact that the defendants 
 were willing to agree that the plaintiff should have the right to occu- 
 py the farm for three years, assuming that he was to remain a free 
 agent, affords no presumption that they would have been willing to 
 grant him that privilege if he was to be imprisoned for a considerable 
 part of the time. No question of forfeiture, strictly so called, is in- 
 volved. We think the defendants were entitled to rescind the con- 
 tract by reason of the plaintiff having disabled himself from perform- 
 ing a material part of his agreement — a part going to the very foun- 
 dation of the contract, without which it presumably would not have 
 been entered into, that their conduct amounted to an enforcement of 
 this right, that they should be allowed to retain possession of the 
 land, and that the plaintiff should be compensated on an equitable 
 basis for the services performed and expenditures incurred, by him 
 prior to his arrest. 
 
 The findings of fact, made by the referee and approved by the 
 court, need not be disturbed ; but, as the accounting was made upon 
 the theory that the plaintiff would be restored to possession, a read- 
 justment will be necessary. 
 
 The judgment is reversed, and the cause remanded for further 
 proceedings in accordance herewith. All the Justices concurring.^* 
 
 NEW YORK LIFE INS. CO. v. STATHAM et al. 
 
 SAME V. SEYMS. 
 
 MANHATTAN LIFE INS. CO. v. BUCK. 
 
 (Supreme Court of the United States, 1876. 93 U. S. 24, 23 L. Ed. 789.) 
 
 The first of these cases is here on appeal from, and the second and 
 third on writs of errors to, the Circuit Court of the United States for 
 the Southern District of Mississippi. 
 
 The first case is a bill in equity, filed to recover the amount of a 
 policy of life assurance, granted by the defendant (now appellant) in 
 1851, on the life of Dr. A. D. Statham, of Mississippi, from the pro- 
 ceeds of certain funds belonging to the defendant attached in the 
 hands of its agent at Jackson, in that State. It appears from the 
 statements of the bill that the annual premiums accruing on the pol- 
 icy were all regularly paid, until the breaking out of the late civil war, 
 
 1* Service is a condition precedent to wages, and is not excused by the fact 
 that the employee, a sailor, was captured and imprisoned by Germany. See 
 Horlock V. Beal, [1916] 1 A. C. 486. 
 
Sec. 6) IMPOSSIBILITY 867 
 
 but that, in consequence of that event, the premium due on the 8th 
 of December, 1861, was not paid; the parties assured being residents 
 of Mississippi, and the defendant a corporation of New York. Dr. 
 Statham died in July, 1862. 
 
 The second case is an action at law against the same defendant to 
 recover the amount of a poHcy issued in 1859 on the life of Henry S. 
 Seyms, the husband of the plaintiff. In this case, also, the premiums 
 had been paid until the breaking out of the war, when, by reason 
 thereof, they ceased to be paid, the plaintiff and her husband being 
 residents of Mississippi. He died in May, 1862. 
 
 The third case is. a similar action against the Manhattan Life In- 
 surance Company of New York, to recover the amount of a policy 
 issued by it in 1858, on the life of C. L. Buck, of Vicksburg; the cir- 
 cumstances being substantially the same as in the other cases. 
 
 Each policy is in the usual form of such an instrument, declaring 
 that the company in consideration of a certain specified sum to it in 
 hand i paid by the assured, and of an annual premium of the same 
 amount to be paid on the same day and month in every year during the 
 continuance of the policy, did assure the life of the party named, 
 in a specified amount, for the term of his natural life. Each con- 
 tained various conditions, upon the breach of which it was to be 
 null and void; and amongst others the following: "That in case the 
 said [assured] shall not pay the said premium on or before the several 
 days hereinbefore mentioned for the payment thereof, then and in 
 every such case the said company shall not be liable to the payment of 
 the sum insured, or in any part thereof, and this policy shall cease 
 and determine." The Manhattan policy contained the additional pro- 
 vision, that, in every case where the policy should cease or become null 
 and void, all previous payments made thereon should be forfeited to 
 the company. 
 
 The non-payment of the premiums in arrear was set up in bar of 
 the actions ; and the plaintiffs respectively relied on the existence of 
 the war as an excuse, offering to deduct the premiums in arrear frorn 
 the amounts of the policies. 
 
 The decree and judgments below were against the defendants. 
 
 Mr. Justice BradlEy,^^ after stating the case, delivered the opinion 
 of the court. 
 
 We agree with the court below, that the contract is not an assurance 
 for a single year, with a privilege of renewal from year to year by pay- 
 ing the annual premium, but that it is an entire contract of assurance 
 for life, subject to discontinuance and forfeiture for non-payment of 
 any of the stipulated premiums. Such is the form of the contract, 
 and such is its character. * * * Each instalment is, in fact, part 
 consideration of the entire insurance for life. It is the same thing, 
 where the annual premiums are spread over the whole life. * * * 
 
 1" Parts of the opinion are omitted. 
 
868 OPERATION OF CONTRACT ' (Ch. 4 
 
 The case, therefore, is one in which time is material and of the 
 essence of the contract. Non-payment at the day involves absolute 
 forfeiture, if such be the terms of the contract, as is the case here. 
 Courts cannot with safety vary the stipulation of the parties by intro- 
 ducing equities for the relief of the insured against their own negli- 
 gence. 
 
 But the court below bases its decision on the assumption that, when 
 performance of the condition becomes illegal in consequence of the 
 prevalence of public war, it is excused, and forfeiture does not ensue. 
 It supposes the contract to have been suspended during the war, and 
 to have revived with all its force when the war ended. Such a suspen- 
 sion and revival do take place in the case of ordinary debts. But have 
 they ever been known to take place in the case of executory contracts 
 in which time is material? If a Texas merchant had contracted to 
 furnish some Northern explorer a thousand cans of preserved meat by 
 a certain day, so as to be ready for his departure for the North Pole, 
 and was prevented from furnishing it by the civil war, would the con- 
 tract still be good at the close of the war five years afterwards, and 
 after the return of the expedition? If the proprietor of a Tennessee 
 quarry had agreed, in 1860, to furnish, during the two following 
 years, ten thousand cubic feet of marble, for the construction of a 
 building in Cincinnati, could he have claimed to perform the contract 
 in 1865, on the ground that the war prevented an earlier perform- 
 ance? 
 
 The truth is, that the doctrine of the revival of contracts suspended 
 during the war is one based on considerations of equity and justice, 
 and cannot be invoked to revive a contract which it would be unjust or 
 inequitable to revive. 
 
 In the case of life insurance, besides the materiality of time in the 
 performance of the contract, another strong reason exists why the pol- 
 icy should not be revived. The parties do not stand on equal ground 
 in reference to such a revival. It would operate most unjustly against 
 the company. The business of insurance is founded on the law of 
 averages; that of life insurance eminently so. The average rate of 
 mortality is the basis on which it rests. By spreading their risks over 
 a large number of cases, the companies calculate on this average with 
 reasonable certainty and safety. Anything that interferes with it de- 
 ranges the security of the business. If every policy lapsed by reason 
 of the war should be revived, and all the back premiums should be 
 paid, the companies would have the benefit of this average amount of 
 risk. But the good risks are never heard from; only the bad are 
 sought to be revived, where the person insured is either dead or dying. 
 Those in health can get new policies cheaper than to pay arrearages on 
 the old. To enforce a revival of the bad cases, whilst the company 
 necessarily lose the cases which are desirable, would be manifestly un- 
 just. An insured person, as before stated, does not stand isolated 
 and alone. His case is connected with and corelated to the cases of all 
 
Sec. 6) IMPOSSIBILITY 860 
 
 others insured by the same company. The nature of the business, as 
 a whole, must be looked at to understand the general equities of the 
 parties. 
 
 We are of opinion, therefore, than an action cannot be maintained 
 for the amount assured on a policy of life insurance forfeited, like 
 those in question, by non-payment of the premium, even though the 
 payment was prevented by the existence of the war. 
 
 The question then aris|g, Must the insured lose all the money which 
 has been paid for premiums on their respective policies? is * * * 
 
 The decree in the equity suit and the judgments in the actions at 
 law arc reversed, and the causes respectively remanded to be pro- 
 ceeded with according to law and the directions of this opinion.^^ 
 
 Waite, C. J. I agree with the majority of the court in the opinion 
 that the decree and judgments in these cases should be reversed, and 
 that the failure to pay the annual premiums as they matured put an 
 end to the -policies, notwithstanding the default was occasioned by the 
 war ; but I do not think that a default, even under such circumstances, 
 raises an implied promise by the company to pay the assured what 
 his policy was equitably worth at the time. I therefore dissent from 
 that part of the judgment just announced which remands the causes 
 for trial upon such a promise. 
 
 Strong, J. While I concur in a reversal of these judgments and 
 the decree, I dissent entirely from the opinion filed by a majority of 
 the court. T cannot construe the policies as the majority have con- 
 strued them. A policy of life insurance is a peculiar contract. Its 
 obligations are unilateral. It contains no undertaking of the assured to 
 pay premiums ; it merely gives him an option to pay or not, and thus 
 to continue the obligation of the insurers, or terminate it at his pleas- 
 ure. It follows that the consideration for the assumption of the 
 insurers can in no sense be considered an annuity consisting of the 
 annual premiums. In my opinion, the true meaning of the contract is, 
 that the applicant for insurance, by paying the first premium, obtains 
 an insurance for one year, together with a right to have the insurance 
 continued from year to year during his life, upon payment of the 
 same annual premium, if paid in advance. Whether he will avail 
 himself of the refusal of the insurers, or not, is optional with him. 
 The payment ad diem of the second or any subsequent premium is, 
 therefore, a condition precedent to continued liability of the insurers. 
 The assured may perform it or not, at his option. In such a case, 
 the doctrine that accident, inevitable necessity, or the act of God, may 
 excuse performance, has no existence. It is for this reason that I think 
 
 1° The court then held that the company must pay back the equitable or 
 cash surrender value of the policy. 
 
 1^ In accord : See Worthington v. Charter Oak Life Ins. Co., 41 Conn. 372, 19 
 Am. Rep. 495 (1874), drawing clearly the distinction between the nonfulfill- 
 ment of a condition precedent to the plaintiff's right and the nonperformance 
 of his contractual duty by the defendant. Impossibility excuses the latter. 
 
870 OPERATION OF CONTRACT (Qj. 4 
 
 the policies upon which these suits were brought were not in force 
 after the assured ceased to pay premiums. And so, though for other 
 reasons, the majority of the court holds: but they hold at the same 
 time, that the assured in each case is entitled to recover the surrender, 
 or what they call the equitable, value of the policy. This is incompre- 
 hensible to me. I think it has never before- been decided that the 
 surrender value of a policy can be recovered by an assured, unless 
 there has been an agreement between the paifties for a surrender : and 
 certainly it has not before been decided that a supervening state of 
 war makes a contract between private parties, or raises an implication 
 of one. 
 
 Mr. Justice CivIFi^ord, with whom concurred Mr. Justice HtJNT, dis- 
 senting. 
 
 When the parties to an executory money-contract live in different 
 countries, and the governments of those countries become involved in 
 public war with each other, the contract between such parties is 
 suspended during the existence of the war, and revives when peace 
 ensues : and that rule, in my judgment, is as applicable to the con- 
 tract of life insurance as to any other executory contract. Conse- 
 quently, I am obliged to dissent from the opinion and judgment of 
 the court in these cases. ^' 
 
 REED v. I.OYAI, PROTECTIVE ASS'N. 
 
 (Supreme Court of Michigan, 1908. 154 Mich. 161, 117 N. W. 600.) 
 
 Action by Watson Reed against the L,oyal Protective Association 
 on an accident policy. From a judgment of the circuit court for 
 plaintiff on appeal from justice court, defendant brings error. Re- 
 versed, and new trial ordered. 
 
 Hooker, J.^' The plaintiff, a policy holder, sued the defendant for 
 sick benefits claimed thereunder, in justice court, where he recovered 
 a judgment for $170. On appeal the learned circuit judge restricted 
 the jury to a verdict for $60, and, from a judgment for that sum, the 
 defendant has appealed. 
 
 We infer that the plaintiff was hurt through a fall in his barn, and 
 the testimony indicates that his recovery • from the effects of the fall 
 
 18 In regard to the influence of war on life insurance policies, see Abell v. 
 Penn. Mutual Life Ins. Co., 18 W. Va. 400, 423-435 (1881) ; New York Life 
 Ins. Co. V. Clopton, 7 Bush (Ky.) 179, 3 Am. Rep. 290 (1869). 
 
 In Semmes v. Hartford Ins. Co., 13 Wall. 158, 20 L. Ed. 490 (1871), the 
 action was upon a policy of fire insurance containing the express stipula- 
 tion that no suit should be sustainable thereundfer unless brought within 
 twelve months after the loss or damage occurred. The Civil War broke out 
 during the twelve months within which the suit should have been brought. 
 Because of the impossibility supposed to exist, the court sustained an action 
 brought several years later, thus nullifying the express condition. See 
 Conditions Subsequent. 
 
 i» The court's statement of the facts has been shortened. 
 
Sec. 6) IMPOSSIBILITY 871 
 
 was not complete for some months. The accident happened on Octo- 
 ber 24th or 26th. A physician was at once called, and his last visit 
 at the home of plaintiff was on October 31st. The policy was made 
 "in consideration of the payment of the membership fee, and of the 
 agreements and statements contained in the application for member- 
 ship, and of the conditions and agreements contained herein and on 
 the back hereof, all of which are hereby made a part of this certifi- 
 cate." It promised that "it is further agreed that if said member 
 shall be afflicted with sickness or receive an injury as aforesaid (5ther 
 than an injury received while riding' as a passenger on said public 
 conveyance), which sickness or injury shall independently of all other 
 causes immediately, wholly, and continuously disable and prevent him 
 from the prosecution of any and every kind of business or labor, then 
 said member in case of sickness and subject to the conditions herein 
 and on the back hereof shall be indemnified in the sum' of 5.00 dollars 
 for the first week and 10.00 dollars a week thereafter. * * * 
 
 "Unless notice of any injury or of the beginning of any sickness is 
 received in writing at the home office of this association in Boston, 
 Massachusetts, on or before the expiration of fourteen days from the 
 commencement of such disability, together with particulars of the in- 
 jury or sickness, including a statement of the time, place and cause of 
 injury, or date of beginning, and an accurate description of the sick- 
 ness, signed by the claimant or attending physician or surgeon, the 
 claim shall be valid only for the period dating from the actual time 
 the notification is received at the home office. The claimant shall 
 also furnish within thirty days after the termination of the disability 
 period a sworn statement of the time he was tota;lly or partially dis- 
 abled, and actual time attended by the physician or surgeon and 
 chairman of the visiting committee of the lodge of which he is a mem- 
 ber or of the lodge whose care he is under on and in accordance with 
 blanks provided by this association, and shall furnish such further 
 proof as may be deemed necessary. Failure to comply with the above 
 conditions renders all claims against the association null and 
 void." * * * 
 
 On December 1st the notice required to be served within 14 days 
 after the accident was received by the company. It was made — i. e.,. 
 filled out — by the physician and dated December 5th, and it was 
 claimed by the defendant that this noncompliance with the terms of 
 the contract was fatal to plaintiff's action, but the trial judge held that 
 this would be true, unless the jury should find that the plaintiff was 
 Insane at the time of the accident "to the extent that his rriind was so 
 deranged that he was unable to furnish defendant notice of such acci- 
 dent within 14 days from the happening of the accident, which de- 
 rangement of, mind was the result of such accident. If you so find, 
 then such failure on the part of plaintiff to give such notice within the 
 14 days as provided for in said policy of insurance would not operate 
 as a forfeiture of plaintiff's right to recover under the policy, but that 
 
S72 OPERATION OF CONTRACT (Ch. 4 
 
 plaintiff would be entitled to a reasonable time in which to furnish 
 defendant with such notice after his mind had attained its normal con- 
 dition." Counsel for defendant assign error upon this instruction on 
 two grounds : (1) That the contract is an unconditional agreement 
 as to notice, and not subject to a construction, which does violence to 
 its plain terms. (2) If this construction were a proper one, the plain- 
 tiff has not proved such derangement, and the proof conclusively 
 shows the opposite. 
 
 [The court here reviewed the testimony at length and found none 
 sufficient to show insanity or mental incapacity.] 
 
 In view of a possible new trial, we consider another question, viz. : 
 Would such an impediment to the serving of notice within the pre- 
 scribed period relieve the plaintiff from the forfeiture? We assume 
 that no one will contend that a court of justice has authority to 
 change the obligations of a contract which the parties have seen tit 
 to make. The case is resolved, then, into a question of construction 
 of the language used. After providing for indemnity, the contract 
 provides : "Unless notice of any injury or of the beginning of any 
 sickness is received in writing at the home office of this association in 
 Boston, Massachusetts, on or before the expiration of fourteen days 
 from' the commencement of such disability together with particulars 
 of the injury or sickness, including a statement of the. time, place and 
 cause of injury, or date of beginning and an accurate description of 
 the sickness, signed by the claimant or attending physician or sur- 
 geon, the claim shall be valid only for the period dating from^ the 
 actual time the notification is received at the home office. * * *• 
 Failure to comply with the above conditions renders all claims against 
 the association null and void." We all know that a failure to perform 
 any ordinary contract is not excused by inability to perform an un- 
 qualified promise. See Pollock on Contracts, 408 et seq. Certainly 
 this is true, unless the failure is due to the. act of God, and in such 
 cases, while it may sometimes excuse the promissor from performance, 
 it is not so certain that it will permit his enforcing the contract which 
 he has been unable to fully perform against the other party, which is 
 what is sought here. It is urged that the authorities are overwhelm- 
 ingly against the contention of* the plaintiff in this case and many 
 are cited. But we are committed to the doctrine in insurance cases, 
 that a provision requiring a notice on pain of forfeiture will not be 
 construed to require strict performance, when by a plain act of God 
 it is made impossible of performance. 
 
 In the case of Phillips v. Ben. Society, 120 Mich. 142, 79 N. W. 
 1, the certificate provided that: "In all cases of accident or sickness, 
 immediate notice was required to be given in writing, addressed to tlie 
 secretary, with full particulars thereof. Failure to give such notice 
 within five days from the happening of such accident or beginning of 
 illness renders the claim invalid, and it cannot be recognized or paid." 
 We 'said : "It is claimed that the plaintiff did not give timely notice 
 
Sec. 6) IMPOSSIBILITY 
 
 sn 
 
 of his injury, in accordance with the provisions of the charter and by- 
 laws. Notice was served upon the company with promptness aftei- he 
 had been informed by one of his physicians that his illness did not 
 result from disease, but from an accident. We do not think that the 
 first notice that he was suffering with neuralgia was binding upon him. 
 It would be a hard rule, and one which the rules of the company must 
 place beyond doubt, which would deprive a member of his benefits 
 through the. mistake of his physician. The notice was served as soon 
 as he ascertained that the accident with which he had met was the oc- 
 casion of his trouble. We think this a sufficient compliance with thp 
 by-law." This case was decided in 1899, and we see no means of dis- 
 tinguishing the question, now under consideration from the one then 
 decided. See, also, the later cases of Woodmen's Ace. Ass'n v. Pratt, 
 62 Neb. 673, 87 N. W. 546, 55 L. R. A. 291, 89 Am. St. Rep. 777, and 
 Comstock V. Fraternal Ace. Ass'n, 116 Wis. 382, 93 N. W. 25, and 
 Munz V. Standard Co., 26 Utah, 69, 72 Pac. 182, 62 L. R. A. 485, 99 
 Am. St. Rep. 830, and cases cited. These cases seem to proceed on the 
 theory that it cannot be supposed that the parties contemplated that 
 the assured should be required to do an impossible thing or suffer a 
 forfeiture of existing rights. 
 
 There are other questions in the case, but they may not arise on an- 
 other trial, and we do not discuss them. 
 
 The judgment is reversed, and a new trial ordered.''" 
 
 2" See, directly contra, Whiteside v. North American Ace. Ins. Co., 200 N. T. 
 320, 93 N. E. 948, 35 L. R. A. (N. S.) 696 (1911), two judges dissent. Cf. 
 Trippe V. Provident Fund Soc, 140 N. Y. 23, 35 N. E. 316, 22 I>. R. A. 432, 37 
 Am. St. Rep. 529 (1893) ; Comstock v. Fraternal Ace. Ass'n; 116 Wis. 382, 
 93 -N. W. 25 (1903). 
 
 In Evans v. Supreme Council of Royal Arcanum, 223 N. T. 497, 120 N. E. 
 93, 1 A. L. R. 163 (1918) payment of certain . assessments vcas an express con- 
 dition precedent to the duty of payment by insurer. The New York Court 
 of Appeals having held that certain assessments were invalid, the insured 
 tendered only such amounts as were held by that court to be due. The in- 
 surer refused the tender. The United States Supreme Court later reversed 
 the decision of the Court of Appeals. The insured was thus left in the posi- 
 tion of not having fulfilled the express condition because of his reliance on 
 the decision of the highest court of New York. That court then held that the 
 policy had been made void by the nonpayment. 
 
 Observe that insurance contracts are aleatory in character, and that the 
 condition is express. See Vance, Insurance, §§ 184-189; Richards on insur- 
 ance, S§ 296-301, 391. 
 
874 OPERATION OP CONTRACT (Ch. 4 
 
 DE LONG V. ZETO et al. 
 
 (Supreme Court of New Tork, Appellate Division, 1909. 135 App. Div. 79, 
 119 N. y. Supp. 765.) 
 
 Action by Albert W. De Long against John Zeto and another. From 
 a judgment dismissing the complaint, plaintiff appeals. Reversed. 
 
 Laughlin, J. This action was brought to recover the balance alleged 
 to be due on a contract between the parties, by which the plaintiff 
 agreed to furnish and deliver to the defendants certain building ma- 
 terials, in part specially manufactured and framed, to be used in the 
 construction of four three-story frame houses, which the defendants 
 were erecting on Decatur avenue, in the city of Greater New York, 
 for the Cosmos Realty Company. The agreement between the par- 
 ties is contained in a letter from the plaintiff, in the name in which he 
 was doing business, to the defendants, under date of September 18, 
 1907, which was accepted in writing by them. The plaintiff was mere- 
 ly to furnish and deliver the material, but was not to put any of it in 
 place in the building. The plaintiff was to receive for the material 
 the sum of $3,300, and the payments were to be made, $1,000 "when 
 standing trim is up," $1,000 "when buildings are complete," and $1,300, 
 the balance, "30 days thereafter." The evidence shows that the plain- 
 tiff delivered all of the material on the premises on which the build- 
 ings were being erected, and that it was accepted by the defendants. 
 The first installment was paid ; but the otlier two installments have not 
 been paid, and the action is to recover the amount thereof. 
 
 The last of the material was delivered in the month of December, 
 1907. The evidence tends to show that in the month of January there- 
 after work was suspended on the buildings, that the defendants filed 
 a mechanic's lien, that a mortgage on the premises was foreclosed, 
 and that the premises were sold under the judgment in that action, 
 in which the defendants and the Cosmos Realty Company were made 
 parties defendant. The evidence indicates that the buildings were 
 never completed by the defendants ; but it would seem that that fact 
 might have been more clearly shown. However, this action was not 
 commenced until the 2d day of November, 1908, nearly one year after 
 the plaintiff completed the delivery of the material. If the buildings 
 were then completed, there was no defense to the action ; and if they 
 were not completed, it would seem, as matter of law, on the facts 
 disclosed by this record, that the defendants had failed to complete 
 the same within a reasonable time, and that the plaintiff was entitled 
 to recover, notwithstanding the express provision of his contract which 
 postponed the payment of these two installments until the completion 
 of the buildings. 
 
 If the failure of the defendants to complete the buildings was owing 
 to a foreclosure of a mortgage, that is no defense to this action. The 
 , plaintiff was not responsible for the foreclosure action, and the conse- 
 quences of it cannot be visited upon him. The defendants and the 
 
Sec. 6) IMPOSSIBILITY 875 
 
 Cosmos Realty Company, with which they contracted and which may 
 be Hable to them, had it in their power to protect their rights by paying 
 the indebtedness secured by the mortgage and taking an assignnjent 
 or discharge thereof, as the case might be. The plaintiff was not a 
 party to the foreclosure action, nor was he concerned therewith. 
 
 It follows that the judgment should be reversed, and a new trial 
 granted, with costs to appellant to abide the event. All concur.^ ^ 
 
 JOHN SOLEY & SONS, Inc., v. JONES et al. 
 (Supreme Judicial Court of Massachusetts, 1911. 208 Mass. 561, 95 N. E. 94.) 
 
 Action by John Soley & Sons, Incorporated, against J. Edwin Jones 
 and another, copartners doing business under the name of Jones & 
 Meehan. There was a verdict for plaintiff, and defendants bring ex- 
 ceptions. Overruled. 
 
 Defendants, having a contract with the feoston Transit Commission 
 for the construction of section 3 of the Washington street tunnel, Bos- 
 ton; contracted with plaintiff to do part of the work. 
 
 BralEy, J. It is a general rule that parties cannot be relieved from 
 their contracts fairly made with full knowledgfe of the facts, although 
 they may have mistaken their rights, or failed to have restricted suffi- 
 ciently their liabilities. Hawkes v. Kehoe, 193 Mass. 419, 79 N. E. 
 766, 10 L. R. A. (N. S.) 125, 9 Ann. Cas. 1053. The defendants 
 knew that by its terms their contract with the transit commissioners 
 could be canceled and discharged, if the engineer gave a certificate 
 that they were not making such progress in the execution of the work 
 as to indicate that it would be completed within the period fixed for 
 performance. It was with this knowledge that they entered into the 
 agreement with the plaintiff as a subordinate contractor to perform 
 part of the work. The impossibility of the defendants' performance 
 of the plaintiff's contract if the contingency arose could have been 
 foreseen and provided for in the instrument.^^ A provision that the 
 promise should be dependent upon the continued existence of the prin- 
 cipal contract would have been sufficient to protect the defendants if 
 the plaintiff was .compelled to abandon the work, because the contract 
 with the commissioners was terminated. New Haven & Northampton 
 Co. V. Hayden, 107 Mass. 525, 531. It is their contention that, when 
 
 21 Where an award of arbitrators is an, express condition, and the ap- 
 pointed arbitrators refuse to agree, the insured can maintain suit on the policy 
 without obtaining any award. Headley v. .ffiJtna Ins. Co., 202 Ala. 384, 80 
 South. 466 (1918). Contra: Grady v. Home Fire & Marine Ins. Co., 27 
 R. I. 435, 63 Atl. 173, 4 L. K. A. (N. S.) 288 (1906), on ground that plaintiff 
 should have tried again ; Fisher v. Merchants' Ins. Co., 95 Me. 486, 50 Atl. 
 282, 85 Am. St. Bep. 428 (1901). Cf. Milnes v. Gery, 14 Ves. 400 (1807), where 
 the contract was as yet wholly unperformed. 
 
 22 Observe that it was performance by the plaintiff that became impossible, 
 not performance of the acts promised by the defendant. 
 
876 OPERATION OF CONTRACT (Ch. 4 
 
 construed in connection with the circumstances, such a condition ap- 
 pears by implication, or is an unexpressed term of the agreement. 
 Hebb V. Welsh, 185 Mass. 335, 336, 70 N. E. 440. The plaintiff's con- 
 tract contained a clause that the work should be performed subject to 
 the directions and to the satisfaction of the commissioners, or of their 
 authorized engineer, and the plaintiff concedes that the amount and 
 character of the work could be ascertained only by resort to the speci- 
 fications of the main contract. If the principal contract in its entirety 
 had been referred to by appropriate language it would have been in- 
 corporated, but it cannot be read into the agreement by implication, 
 where pnly that part which is germane to the plaintiff's performance 
 may be implied, and the language is unambiguous. De Ffiest v. Brad- 
 ley, 192 Mass. 346, 355, 78 N. E. 467; Lipsky v. Heller, 199 Mass. 
 310, 315, 85 N. E. 453. The auditor, whose finding is not questioned, 
 reports that the plaintiff at the time of execution knew not only of the 
 s.pecifications under which its work must be done, but of the article of 
 cancellation. It apparently acted upon this information, when it ceased 
 work upon having been informed that the right of termination had been 
 exercised. The act of the commissioners, and its decisive effect upon 
 the plaintiff's right to go forward under the contract, having been 
 known to each party, further notice from one to the other of their 
 several rights or demands would have been a vain formality. Cum- 
 berland Glass Mfg. Co. v. Wheaton, 208 Mass. 425, 94 N. E. 803. 
 
 It is urged that, the possible disabihty which would prevent per- 
 formance by the defendants having been known to the plaintiff at the 
 inception of the contract, it was niutually understood that they did not 
 intend to perform, and the plaintiff had no expectation of perform- 
 ance, unless the principal contract remained in force. But while we 
 can construe the contract in writing which the parties made, we cannot 
 make a contract for them. It is only where an unanticipated event 
 happens, which was not in the contemplation of the parties at its in- 
 ception, and upon which the continued existence of the contract must 
 depend, that upon the happening of the event the contract is dissolved, 
 and the promisor relieved from further performance. Butterfield v. 
 Byron, 153 Mass. 517, 27 N. E. 667, 12 L. R. A. 571, 25 Am. St. Rep. 
 654; Hawkes v. Kehoe, 193 iVIass. 419, 423, 79 N. E. 766, 10 L. R. A. 
 (N. S.) 125, 9 Ann. Cas. 1053 ; Vickery v. Ritchie, 202 Mass. 247, 251, 
 88 N. E. 835, 26 L. R. A. (N. S.) 810; Rowe v. Peabody, 207 Mass. 
 226, 93 N. E. 604; Sun Printing & Publishing Association v. Moore, 
 183 U. S. 642, 22 Sup. Ct. 240, 46 L. Ed. 366; Baily v. De Crespigny, 
 E. R. 4 Q. B. 180, 185. If the plaintiff and defendants contracted 
 with knowledge of the clause of termination, the defendants of course 
 knew that when the principal contract came to an end, either with or 
 without their fault, further performance by the plaintiff would be im- 
 possible. Instead of providing for a contingency reasonably to be an- 
 ticipated, the defendants gave an absolute promis'e to pay the contract 
 price on the basis that there should be no interference with the work 
 
Sec. 6) IMPOSSIBILITY • 877 
 
 of construction if the plaintiff's conduct was satisfactory to the com- 
 missioners as it appears to have been. Having made themselves respon- 
 sible for the existence of the subject-matter of the contract until with- 
 out fault on the plaintiff's part it had been performed, they are not 
 within the exception or principle of construction recognized and fol- 
 lowed in Wells v. Calnan, 107 Mass. 514, 9 Am. Rep. 65, Butter- 
 field V. Byron, 153 Mass. 517, 27 N. E. 667, 12 h. R. A. 571, 25 Am. 
 St. Rep. 654, Young v. Chicopee, 186 Mass. 518, 72 N. E. 63, Angus 
 V. Scully, 176 Mass. 357, 57 N. E. 674, 49 L. R. A. 562, 79 Am. St. 
 Rep. 318, and Hawkes v. Kehoe, 193 Mass. 419, 79 N. E. 766, 10 L. R. 
 A. (N. S.) 125, 9 Ann. Cas. 1053 ; where the occurrence which dis- 
 charged the contract was of such a character that the parties were 
 held not to have had it in contemplation at the making of the agree- 
 ment. See Hebert v. Dewey, 191 Mass. 403, 411, 77 N. E. 822; Vick- 
 ery v. Ritchie, 202 Mass. 247, 88 N. E. 835, 26 L. R. A. (N. S.) 
 810. The rulings on the question of liability upon which the measure 
 of damages under the first count of the declaration must rest, that the 
 causes for the termination of the principal contract were immaterial as 
 the commissioners had reserved that right, and that there had been a 
 breach, were in accordance with our construction of the rights of the 
 parties. The contract not having been dissolved, the plaintiff was not 
 remitted to compensation for the fair value of the work done with a 
 reasonable profit for such work, and also upon the work remaining to 
 be performed, or restricted to a sum which would be proportionate to 
 the contract price the defendants were to receive from the commis- 
 sioners. But it was entitled to the benefit of the contract after deduct- 
 ing from the contract price the reasonable cost of completing the 
 work. Olds v. Mapes-Reeve Construction Co., 177 Mass. 41, 58 N. E. 
 478; Norcross Brothers Co. v. Vose, 199 Mass. 81, 85 N. E. 468; 
 Gagnon v, Sperry & Hutchinson Co., 206 Mass. 547, 92 N. E. 761. 
 The rulings requested were rightly refused, and the instructions given 
 were correct. 
 Exceptions overruled." 
 
 Y. B. 15 HEN. VII, 13, 24. 
 
 One Blike executed an obligation to another upon condition that if 
 J. S. should come to London on or before the Festival of St. Michael 
 next ensuing and bring with him sufficient sureties, and there enter into 
 an obligation' to the plaintiff in the sum of £20 to pay in four years 
 thereafter, then this obligation should be void, etc. Later, J. S. died 
 before the said Festival. And all the Court held clearly that the 
 condition is discharged and the obligation void, for it has become im- 
 
 23 In accord : Guerlni Stone C!o. v. J. P. Carlin Const. Co., 240 U. S. 264, 
 36 Sup. Ct. 300, 60 L. Ed. 636 (1915). And see Grimsdick v. Sweetman, [1909] 
 2 K. B. 740. 
 
878 . OPERATION OF CONTBACT (Ch. 4 
 
 possible, by act of God, for he had all the time prior to the Festival 
 within which to come, at his pleasure, and so there is no default in J. 
 S., and his sureties are not bound to come and execute an obligation 
 for no particular person was named who was to become surety. In- 
 asmuch as the condition, is that he and his sureties come and execute 
 an obligation it is a joint act and cannot be performed because of the 
 act of God. But Frowike said that if the condition were that J. S. 
 and J. N. should come to London and be bound, then if one die the 
 other is nevertheless bound to come. 
 
 PARADINE V. JANE. 
 (In the King's Bench, 1647. Aleyn, 26.) 
 
 In debt the plaintiff declares upon a lease fOr years rendering rent 
 at the four usual feasts ; and for rent behind for three years, ending 
 at the Feast of the Annunciation, 21 Car. brings' his action ; the de- 
 fendant pleads, that a certain German prince, by name Prince Rupert, 
 an alien born, enemy to the King and kingdom, had invaded the realm 
 with an hostile armyof men ; and with the same force did enter upon 
 the defendant's possession, and him expelled, and held out of posses- 
 sion from the 19 of July 18 Car. till the Feast of the Annunciation, 21 
 Car. whereby he could not take the profits; whereupon the plaintiff 
 demurred, and the plea was resolved insufficient.^* * * * 
 
 3. It was resolved, that the matter of the plea was insufficient; for 
 though the whole army had been alien enemies, yet he ought to pay his 
 rent. And this difference was taken, that where the law creates a duty 
 or charge, and the party is disabled to perform it without any default 
 in him, and hath no remedy over, there the law will excuse him. As in 
 the case of waste, if a house be destroyed by tempest, or by enemies, the 
 lessee is excused. Dyer, 33. a. Inst. S3, d. 283. a. 12 H. 4. 6. so of 
 an escape. Co. 4. 84. b. 33 H. 6. 1. So in 9 E. 3.16. a supersedeas 
 was awarded to the justices, that they should not proceed in a cessavit 
 upon a cesser during the war, but when the party by his own contract 
 creates a duty or charge upon himself, he is bound to make it good, 
 if he may, notwithstanding any accident by inevitable necessity, because 
 he might have provided against it by his contract. And therefore if 
 the lessee covenant to repair a house, though it be burnt by lightning, 
 or thrown down by enemies, yet he ought to repair it. Dyer 33. a; 
 40 E. III. 6. h. Now the rent is a duty created by the parties upon the 
 resei-vatioh, and had there been a covenant to pay it, there had been no 
 question but the lessee must have made it good, notwithstanding the 
 interruption by enemies, for the law would not protect him beyond his 
 own agreement, no more than in the case of reparations ; this reserva- 
 
 "* Part of the report is omitted. 
 
Sec. 6) IMPOSSIBILITY 879 
 
 tion then being a covenant in law, and whereupon an action of cove- 
 nant hath been maintained (as Roll said) it is all one as if there had 
 been an actual covenant. Another reason was added, that as the lessee 
 is to have the advantage of casual profits, so he must run the hazard 
 of casual losses, and not lay the whole burthen of them upon his 
 lessor ; and Dyer 56.6. was cited for this purpose, that though the land 
 be surrounded, or gained by the sea, or made barren by wildfire, yet 
 the lessor shall have his whole rent: and judgment was given for the 
 plaintiff. i 
 
 YERRINGTON v. GREENE et al. 
 (Supreme Court of Ehode Island, 1863. 7 R. I. 589, 84 Am. Dee. 578.) 
 
 Assumpsit against the defendants, as administrators on the es- 
 tate of William W. Keach, for the recovery of damages for the 
 breach of a contract by which the said Keach agreed to employ the 
 plaintiff, at a salary, for three years, in his business. 
 
 At the trial of the case, under the general issue, at the March term 
 of this court, 1863; before the chief justice, with a jury, it was proved 
 by letters interchange between the plaintiff, who then resided in 
 Boston, and the intestate, who was a manufacturing jeweller, in 
 Providence, that on the 19th day of March, 1860, the former agreed 
 to serve the intestate, and the latter agreed to employ the plaintiff, 
 as a clerk and salesman, having charge ^f the intestate's office, or 
 place of sale, in New York, and as agent in his business in making 
 occasional trips for him to Philadelphia for the term of three years 
 from the first day of April, 1860, or as soon thereafter as the plain- 
 tiff could obtain a release from his employment in Boston, at a salary 
 of twelve hundred dollars, for the first year, of thirteen hundred dol- 
 lars, for the second year, and of fifteen hundred dollars, for the third 
 year; that on the sixteenth day of April, 1860, the plaintiff entered 
 into the service of the intestate, under this contract, and continued 
 to serve him under it until the first day of April, 1861, when the said 
 Keach died ; that the defendants, as administrators of said Keach, 
 continued to employ the plaintiff, at the stipulated salary, until the 
 sixteenth day of June, 1861, when, having discontinued the office in 
 New York, and removed what goods were there to Providence, where 
 Keach had another place of sale, they declined longer to employ the 
 plaintiff, or to pay him his salary, though from that time to the date 
 of the writ, he had been ready and willing to serve in said business, 
 and had tendered his services in it to them, and had been unable to 
 procure other employment; that the defendants, as administrators of 
 Keach, wound up his business by selling the goods removed from 
 New York, with other goods of his, at Providence, and had been 
 allowed by the court of probate, for their services as administrators, 
 the sum of three thousand dollars. Upon this state of facts, the 
 
880 OPERATION OP CONTRACT (Ch- 4 
 
 chief justice instructed the jury, that the death of Keach terminated 
 this contract of service, and that no recovery of damages could be 
 had of the defendants, as his administrators, for their refusal to em- 
 ploy the plaintiff under it afterwards ; whereupon, the jury having re- 
 turned a verdict for the defendants, the plaintiff, having duly except- 
 ed thereto, now moved for a new trial, on the ground of error in law 
 in said instruction. 
 
 Ames, C. J. It is, in general, true, that death does not absolve a 
 man from his contracts; but that they must be performed by his 
 personal representatives, or their non-performance compensated, out 
 of his estate. An exception to this rule, equally well established, at 
 both the civil and common law, is, that in contracts in which perform- 
 ance depends upon the continued existence of a certain person or 
 thing, a condition is implied, that the impossibility of performance 
 arising from the perishing of the person or thing shall excuse the 
 performance. The implication arises in spite of the unqualified char- 
 acter of the promissory words, because, from the nature of the con- 
 tract, it is apparent that the parties contracted upon the basis of the 
 continued existence of the particular person or chattel. The books 
 afford many illustrations of this reasonable mode of construing con- 
 tracts, de certo corpore, as the civil law des^gnation of them is, in 
 furtherance of the presumed and probable intent of the parties. The 
 most obvious cases are, the death of a party to a contract of mar- 
 riage before the time fixed by it for the marriage ; the death' of an 
 author or artist before the time contracted for the finishing and de- 
 livery of the book, picture, statue, or other work of art ; the, death of 
 a certain slave promised to be delivered, or of a horse promised to 
 be redelivered, before the day set for the delivery or redelivery; and 
 the death of a master or apprentice before the expiration of the term 
 of service limited in the indenture. The bodily disability from super- 
 vening illness, as of an artist, from blindness, to paint the picture 
 contracted for, or of a scholar to receive the instruction his father 
 had stipulated should be received and paid for, has been held, for the 
 like reason, to excuse each from the performance of his contract. 
 Hall-v. Wright, 1 El., Bl. & El. 746; Stewart v. Loring, 5 Allen 
 (Mass.) 306, 81 Am. Dec. 747. The cases in support of these and 
 other illustrations of the exception to the general rule are set down 
 in the defendants' brief, and it is unnecessary to repeat them. 
 
 Both at the civil and the common law, it is necessary, that the 
 party who would avail himself of this excuse for non-performance 
 of the contract, should be without fault in the matter upon which 
 he relies as an excuse. The latest and most instructive case, upon 
 this subject, so far as the discussion of the principle of decision is 
 concerned, is that of Taylor v. Caldwell, decided by the queen's 
 bench, in May last, 8 Law T. Rep. 356. In that case it was held, 
 that the parties were discharged from a contract to let a music hall 
 for four specified days for a series of concerts, by the accidental de- 
 
Sec. 6) IMPOSSIBILITY 881 
 
 struction of the hall by fire before the first day arrived. The full 
 and lucid exposition by Mr. Justice Blackburn, who delivered the 
 opinion of the court, of the prior cases and of the principle upon 
 which they have been decided, leaves nothing further to be desired 
 upon this subject. 
 
 Does the case at bar fall within the general rule, or within the ex- 
 ception we have been considering? This must depend upon the na- 
 ture of the contract, whether one, requiring the continuing existence 
 of the employer, Keach, for performance on his part, or one which 
 could, according to its spirit and meaning, be performed by the de- 
 fendants, his administrators. The contract was, to employ the plain- 
 tiff as clerk and agent of the intestate, in his business, in New York 
 and Philadelphia; and it seems to us undoubted, that the continued 
 existence of both parties to the contract for the whole stipulated 
 term, was the basis upon which the contract proceeded, and if called 
 to their attention at the time of the contract, must have been con- 
 templated as such by them. The death of the plaintiff within the 
 three years would certainly have been a legal excuse from the fur- 
 ther performance of his contract; since it was an employment of 
 confidence and skill, the duties of which, in the spirit of the contract, 
 could be fulfilled by him alone. If this be the law in application to 
 a covenant for ordinary service (Shep. Touch. 180), how much more 
 in application to a contract for service of such confidence and skill 
 as that of a clerk and agent for sale. On the other hand, this em- 
 ployment could continue no longer than the business in which the 
 employer was engaged, and the plaintiff retained. The intestate, 
 when living, could, by the contract, have required the services of 
 the plaintiff in no other business than that in which he had engaged 
 him, and with no other person than himself. It would seem, then, 
 necessarily to follow, that when the death of the employer put a stop 
 to this business, and left no legal right over it in the administrators, 
 except to close jt up with the least loss to the estate of their de- 
 cedent, they were, by the contract, bound no longer to employ the 
 plaintiff, any more than he to serve them. The act of God had tak- 
 en away the master and principal, — the law had revoked his agency, 
 and stopped the business to which alone his contract bound him, — 
 and if he would serve the adminigtrators in winding up the estate, it 
 must be under a new contract with them, and under renewed powers 
 granted by them. Any other result than that this contract of serv- 
 ice was upon the implied condition that the employer, as well as 
 the employed, was to continue to live during the stipulated term of 
 employment, would involve us in the strange conclusion, that the 
 administrators might go on with the business of their intestate, in 
 which the plaintiff must contiilue with powers unrevoked by the 
 death of his principal, or, that he, with new powers from them, was 
 bound by the contract to serve them as new masters, and in a dif- 
 ferent service, and that they were bound to grant him such powers, 
 
 COKBIN CONT 56 
 
882 OPERATION OF CONTKACT (Ch. 4 
 
 and employ him for the stipulated time in such service. The novelty 
 of such a claim, and the contradiction of well-settled principles nec- 
 essary to maintain it, justify the ruling of the judge who tried the 
 cause ; and this motion must be dismissed with costs, and judgment 
 entered upon the verdict."' 
 
 MOORE & BAKER v. MORECOMB. 
 
 (In the Common Pleas, 1601. Cro. Eliz. 864.) 
 
 Debt upon an obligation, conditioned to deliver to the plaintiff be- 
 fore such a feast such a ship, and all the tackling thereto, or in de- 
 fault thereof to pay at the same feast such a sum as John Norris and 
 J. S. shall value them to be worth. The defendant pleaded, that before 
 the said feast the said J. Norris and J. S. did not make any valuation 
 of them. It was thereupon demurred: and resolved by all the Court 
 for the plaintiff ; for although he hath election to do the one or the 
 other, yet the condition being for his benefit, he ought to provide that 
 the value should be assessed, otherwise he is to deliver the goods 
 themselves ; for if one be obliged to make such an assurance of such 
 land as the counsel of the obligee before such a day shall advise, or to 
 pay there and then £100 if the counsel devise not any assurance, he 
 
 ^o In the case of a contract for strictly personal service the death, insanity, 
 or incapacitating Illness of the employee prevents his nonperformance from 
 operating as a breach. Spalding v. Kosa, 71 N. T. 40, 27 Am. Kep; 7 (1877), 
 service as singer; MendenhaU v.: Davis, 52 Wash. 169, 100 Pac. 336,, 21 L. R. 
 A. (N. S.) 914, 17 Ann. Cas. 179 (1909), service as dentist; Browne v. Fair- 
 hall, 213 Mass. 290, 100 N. E. 556, 45 L. R. A. (N. «.) 349 (1913), contract 
 to give personal note; Stubbs v. Holywell Ry. Co., L. R. 2 Exch. 311 (1867) ; 
 Robinson v. Davison, L. R. 6 Exch. 269 (1871). 
 
 The death of the employer or master has the same effect \vhere the service 
 is to be strictly personal to him. Kenny v. Doherty, 230 N. T. 44, 129 N. E. 
 201 (1920) ; Lacy v. Getman, 119 N. Y. 109, 23 ,N. B. 452, 6 L. R. A. 728, 16 
 Am. St. Rep. 808 (1890) ; Earrow v. "Wilson, L. R. 4 O. P. 744 (1869) ; Homan 
 V. Redick, 97 Neb. 299, 149 N. W. 782, L. R. A. 19150, 601 (1914). It is 
 otherwise where the service is not to be under the employer's personal super- 
 vision: Dumont v. Heighton, 14 Ariz. 25, 123 Pac. 306, 39 L. R. A. (N. S.) 
 1187 (1912) ; Phillips v. Alhambra Palace Co., [1901] 1 K. B. 63, death of 
 one partner. i 
 
 It has been held that the involuntary dissolution of a corporation by the 
 state prevents its further nonperformance from operating as a breach. People 
 V. Globe Mut. Life Ins. Co., 91 N. Y. 174 (1883) ; Assets Realization Co. v. 
 Roth, 226 N. Y. 370, 123 N. E. 743 (1919). But it is generally held that In- 
 voluntary bankruptcy or insolvency and appointment of a receiver will operate 
 as a breach of contract, unless the receiver himself is able to comply with the 
 contract and does so. Central Trust Co. of Illinois v. Chicago Auditorium 
 Ass'n, 240 U. S. 581, 36 Sup. Ct. 412, 60 L. E4. 811, L. R. A. 1917B, 580 (1915) ; 
 Wm. Filene's Sons Co. v. Weed, 245 U. S. 597, 38 Sup. Ct. 211, 62 L. Ed. 497 
 (1918) ; Chemical Nat. Bank v. Hartford Deposit Co., 161 U. S. 1, 7, 16 Sup. Ot 
 439, 40 L. Ed. 595 (1895); Isaac Mclean Sons Co. v. William S. Buttles & 
 Son (D. C.) 227 Fed. 325 (1914) ; Spader v. Mural Decoration Mfg. Co., 47 N. 
 J. Eq. 18, 20 Atl. 378 (1890) ; Ogdens, Limited, v. Nelson, [1905] A. C. 109, 
 112; Reigate .v. Union Mfg. Co., [1918] 1 K. B. 592; Yelland's Case, L. R. 4 
 Eq. 350 (1867). 
 
Sec. 6) IMPOSSIBILITY 883 
 
 ought to pay the ilOO for it being to his advantage when it is per- 
 formed, he ought to provide that he performs the one.-^Apd Walms- 
 ley said. If one be obliged to pay i20 before the first day of May, or 
 to marry A. S. before the first day of August next ensuing, if he doth 
 not pay the £20 before the first day of May, and A. S. dies before the 
 first day of August, so as the condition is become impossible by the 
 act of God in this part, yet the obligation is, forfeited, because he hath 
 undertaken to perform the one of them; and it was his folly that he 
 did not perform it when it was in his power and election to have done 
 it. Wherefore, &c.^And afterwards it was adjudged for the plain- 
 tifif.''' 
 
 VIRGINIA IRON, COAL & COKE CO. v. GRAHAM et al. 
 (Supreme Court of Appeals of Virginia, 1919. 124 Va. 692, 98 S. E. 659.) 
 
 Suit by the Virginia Iron, Coal & Coke Company against Nannie 
 M. Graham and others. From a decree for defendants, plaintiff ap- 
 peals. Reversed and remanded. 
 
 PrEntis, J." * * * The facts here to be considered are : That 
 by indenture of December 31, 1897, David P. Graham and wife de- 
 mised unto Carter Coal & Iron Company for 40 years from January 
 1, 1898, that certain^ iron ore property in Wythe county, Va., known 
 as "Cedar Run," theretofore granted fo Graham by Franklin Carter 
 and wife, said to contain about 3,600 acres, with the right during the 
 term to mine and remove all the iron ore which the lessee might or 
 could mine on these lands, with certain easements and privileges fully 
 set forth in the instrument. By deed of January 27, 1899, Carter Coal 
 & Iron Company conveyed unto Virginia Iron, Coal & Coke Com- 
 pany (appellant, hereinafter called the lessee), together with other 
 property, the rights and privileges granted by the said lease. * * * 
 
 The original lease fixed a royalty of 50 cents per long ton for each 
 ton of good merchantable ore mined and shipped from the leased 
 premises, to be paid to the lessor on or about the 2'5th days of April, 
 July, October and January of each year for the ore shipped the pre- 
 ceding three months, with the following provisions as to minimum : 
 "Not less than twenty thousand tons to be shipped each year. If less 
 is sliipped, royalty is to be paid on twenty thousand tons, and if more 
 than twenty thousand tons are shipped in one year, and less than 
 that quantity in the next preceding or succeeding ^year, the surplus 
 of the one year, and the royalty paid thereon, may be carried to 
 the credit of the other year, either preceding or succeeding, to make 
 
 2^ It is always possible to contract as an insurer that a certain performance 
 will take place; the duty is then in the alternative, to cause specific per- 
 formance or to t)av losses caused by nonperformance. See Hills t. Sughrue, 
 15 M. & W. 252 '(1846). 
 
 27 Parts of the opinion are omitted. 
 
884 OPERATION OF CONTRACT (Ch. 4 
 
 the required minimum. If the minimum quantity is not shipped in 
 any year or paid for iii sixty days after the expiration of the year, 
 or if the ore shipped is not paid for in sixty days after the rent 
 therefor is due, the said David P. Graham, his heirs, representatives, 
 or assigns, may terminate this lease on ten days' notice of intention 
 so to do." * * * , 
 
 The Carter Coal & Iron Company took possession and continued 
 to operate the mine until it conveyed its rights to the Virginia Iron, 
 Coal & Coke Company, and thereafter the last-named company con- 
 tinued to operate it until July 25, 1916, upon which date it gave writ- 
 ten notice to Nannie M. Graham and others, the lessors, of the can- 
 cellation or surrender of the original lease of December 31, 1897, to 
 become effective as of September 1, 1916. The reason therefor stated 
 in the notice was that iron ores could no longer be found on the 
 leased premises, either of the quality or in the quantity that could be 
 profitably mined ; the cost of such tonnage as could be gotten out be- 
 ing altogether prohibitive. The lessors replied to this notice August 
 29, 1916, advising that they intended to hold the lessee strictly to the 
 terms of the contract, and conceded no authority to cancel it. 
 
 The lessee, in accordance with such notice, ceased operations upon 
 the leased premises, has abandoned possession thereof for all the pur- 
 poses of the lease, though it has not removed its property therefrom, 
 has paid all royalties accrued up to the date designated for the cancel- 
 lation and surrender to become effective, and has not since that time 
 occupied the property or exercised any of the privileges granted by 
 the lease. After the attempted cancellation and surrender, the lessee 
 undertook to remove fromi the leased premises the machinery, rails, 
 and equipment placed thereon by its predecessor, which under the 
 terms of the lease it had the right to remove upon its termination, 
 but, under threat of proceedings by the lessors to secure an injunction, 
 has for the present abandoned its claim of right to remove such prop- 
 erty. It seems that this allegation of threatened injunction proceed- 
 ings is made in an amendment to the bill, and that this threat was 
 made after the institution of this suit. The cancellation and surrender 
 of the lease has been ratified by the board of directors of the lessee, 
 and the deed of release tendered to the lessors with the bill and ' 
 amended bill. 
 
 The lessee, on January 30, 1917, filed its original bill, and thereafter 
 filed an amended bill against Nannie M. Graham and others, succes- 
 sors in title to the original lessor, and the trustees in the deeds of trust 
 referred to, setting forth these facts, and praying for a decree cancel- 
 ing the lease, permitting it to remove its personal property from the 
 premises, enjoining the lessors from prosecuting any actions for the 
 recovery of royalties under the lease, and for general relief. The 
 lessors, defendants, filed their demurrer and answer, and the trial 
 court sustained the demurrer and dismissed the Dill. Of this action 
 the lessee is here complaining. 
 
Sec. 6) IMPOSSIBILITY 885 
 
 Fairly stated, the demurrer is based upon two grounds : 
 
 (1) That the bill and exhibits filed show that the contract between 
 the parties is a contract of hazard, that the risk as to the quantity 
 and quality of ore was assumed by the lessee, and that this appears 
 from the lease itself ; that it also appears therefrom that it is a definite 
 contract, under seal, for the rental of the property for 40 years, in- 
 cluding the right to the lessee to mine ore and do certain other things 
 on the land; that the consideration of the lease is a sum certain as 
 rent reserved ; and that there is no warranty on the part of the lessors' 
 that the ore will be found of any particular quantity or quality, and 
 hence that the existence or nonexistence of such ore in any quantity 
 or of any quality is immaterial. 
 
 (2) That even if the lessee is entitled to be relieved from paying 
 the royalty on account of exhaustion of the ore in the premises; a 
 court of equity has no jurisdiction to grant such relief, upon the 
 ground that the complainant has a complete and adequate remedy at 
 law. 
 
 The trial court sustained the demurrer upon the ground last stated. 
 
 (a) Taking up these grounds in the order in which we have just 
 stated them, we come to consider whether the bill is demurrable upon 
 the ground that the contract was one of hazard as to the lessee. 
 
 The question is quite an mteresting one, and we have been greatly 
 enlightened by the exhaustive briefs of the- learned counsel on both 
 sides. While no precisely similar question has eter been decided in 
 Virginia, we have been referred to many cases in other jurisdictions, 
 and the principles involved seem to be fairly well established.^' * * * 
 
 If one makes a contract to do a thing which is in itself possible, he 
 will be liable for a breach of the contract, notwithstanding it is be- 
 yond his power to perform it. But where, from the nature of the 
 contract itself it is apparent that the parties contracted on the basis 
 of the continued existence of the substance to which the contract 
 related, a condition is implied that if performance becomes impossi- 
 ble because that substance does not exist, this will and should ex- 
 cuse such performance. Walker v. Tucker, 70 111. 527. 
 
 The case of Muhlenberg v. Henning, 116 Pa. 138, 9 Atl. 144, is 
 strikingly like this case. There was a 5-year lease in which the les- 
 sees covenanted to pay 35 cents a ton for every ton of merchantable 
 ore mined, and to mine at least 1,500 tons annually during the term, 
 or, in default thereof, to pay a royalty of $525 annually; and that 
 the lease should be forfeited at the option of the lessors, if at the 
 end of each year at least $525 as rent or royalty had not been paid. 
 In an action to recover unpaid royalty for two years, an affidavit 
 of defense was filed, averring that, though the defendants had op- 
 erated the mines in a workmanlike and skillful manner for about 
 
 28 The court here quoted at length from 13 C. J. 376, 27 Cyc. 718, Krell v. 
 Henry, [1903] 2 K. B. 740, and referred to an "instructive note" in L. R. A. 
 1916F, 10. 
 
886 OPERATION OF CONTRACT (Ch. 4 
 
 nine months, yet, on account of the nonexistence of sufficient ore 
 and its inferior and unmerchantable quality, they were unable to 
 continue. It was held that the affidavit exhibited a good defense to 
 the action, and the court there distinguished such a lease from those 
 involved in the cases which were there and are here, relied upon to 
 support a contrary view, notably Jervis v. Tomkinson, 1 Exch. (H. 
 & N.) 195, and Marquis of Bute v. Thompson, 13 M. & W. 486, in 
 both of which cases the contracts were construed to import an ab- 
 solute covenant to pay the rent whether the mines could be made 
 to produce the mineral or not. 
 
 In Williston on Sales, § 661, it is said: "It is probable that the 
 tendency of the law is towards an enlargement of the defense of im- 
 possibility, and in any case where it may fairly be said that both par- 
 ties assumed that the performance of the contract would involve 
 the continued existence of a certain state of affairs, impossibility of 
 performance due to a change in this condition of affairs will be an 
 excuse." ^o * * * 
 
 Ridgley v. Conewago Iron Co. (C. C.) 53 Fed. 988, construes a 
 mining lease which required the lessee to mine at least 4,000 tons 
 annually, and to pay therefor a fixed sum per ton, or, in case he 
 fails to take out such quantity, to pay therefor. It was held that the 
 lease imposed no obligation to pay the minimum royalty after the 
 ore in the premises had /become exhausted. There Dallas, Circuit 
 Judge, said: 
 
 "Mining leases commonly include, in addition to the usual under- 
 taking to pay for what may be actually mined, a covenant that some 
 fixed or ascertainable sum, at least, shall be annually paid. These 
 covenants are not all the same, or to the same effect. They may be 
 divided into two classes : First, those which require the payment of 
 rent irrespective. of product; second, those which require that, upon 
 failure to take out a stipulated quantity, royalty with respect there- 
 to shall nevertheless be paid. Where the covenant is of the first 
 class the tenant is liable for the rent, even if nothing could be got- 
 ten by mining. * * * Where the covenant is of the second class 
 his obligation is to pay for the stipulated quantity, whether mined 
 or not ; not whether it exists or not. He contracts for promptitude 
 and thoroughness in mining; not for the productiveness of the 
 mine. Lord Clifford v. Watts, L. R. 5 C. P. 577; Muhlenberg v. 
 Henning, 116 Pa. St. 138, 9 Atl. 144. This covenant is of the second 
 class." 
 
 The general rule, substantially as stated by Judge Dallas, is rec- 
 ognized in the following cases ; so * * * 
 
 29 There were further quotations from Bishop on Contracts (2d Ed.) § 588, 
 Mineral Park Land Co. v. Howard, 172 Cal. 289, 156 Pac. 458, L. K. A. 1916F, 
 1 (1916), and Boyer v. Fulmer, 176 Pa. 282, 35 Atl. 235 (1896). 
 
 30 The court here cited eighteen cases. See original report. See, also, in 
 accord: Lord ClifCord v. Watts, L. R. 5 C. P. 577 (1870). 
 
Sec. 6) IMPOSSIBILITY 887 
 
 There are other cases which cannot be reconciled with this view, 
 though some of them may be distinguished. There is a line of cases 
 in which the lessee has been required to pay the minimum royalty, 
 notwithstanding the exhaustion of the mine, if he continues in pos- 
 session of the leased premises claiming under the lease. ^^ * * * 
 
 Then in Lehigh Zinc Co. v. Bamford, 150 U. S. 665, 14 Sup. Ct. 
 219, 37 L. Ed. 1215, it is held that where the right to mine ore in 
 the premises was not the substantial inducement for the lease, and 
 the covenant to pay a fixed royalty as rent per year is not qualified, 
 the lessor is not released even if the mineral is exhausted. Then 
 there are cases where it is said that the amount of mineral was known 
 to the parties at the time the lease was entered into, and the con- 
 tract was for the sale and purchase of such mineral. Timlin v. 
 Brown, 158 Pa. 606, 28 Atl. 236; Bute v. Thompson, 13 M. & W. 
 487, 153 Eng. Rep. 202; Jervis v. Tomkinson, 4 Week. Rep. 683.^' 
 
 Applying these principles to the bill and lease here involved, it ap- 
 pears clear that the main purpose of the contract was to mine iron 
 ore, the existence of which in quantities great enough to justify the 
 continuance of mining operations for 40 years was assumed as a 
 fact by both parties, and by its express language the lessor was to 
 receive 50 cents per long ton as compensation, "for each ton of 
 good merchantable ore mined and shipped." The subject and sub- 
 stance of the contract is merchantable iron ore, to be mined and 
 shipped, and the obligation is to pay therefor, or to pay such royal- 
 ty on the minimum quantity which both parties assumed could be so 
 produced. This language in the lease confirms this view: 
 
 "Not less than twenty thousand tons to be shipped each year. If 
 less is shipped, royalty is to be paid on twenty thousand tons, and 
 if more than twenty thousand tons are shipped in one year, and 
 less than that quantity in the next preceding or succeeding year, the 
 surplus of the one year and the royalty paid thereon may be carried 
 to the credit of the other year, either preceding or succeeding to 
 make the required minimum." 
 
 How is it possible for the lessee to receive the benefit of these 
 credits unless the ore exists? The contingency provided against 
 was the failure to mine and not the exhaustion of the ore which 
 both parties assumed to exist. It is manifest then that if the facts 
 alleged in the bill can be proved, and the ore does not exist, the les- 
 see should be relieved of its obligation to pay the royalty- provided 
 for in the lease, because the paramount consideration of the con- 
 tract has failed, and performance thereof by the lessee has become 
 
 31 The court here cited 4 cases. 
 
 32 A contract may be clearly in the alternative, and tjie promisor must 
 perform even though one alternative is impossible. Bute v. Thompson (1844) 
 supra, coal vein exhausted, but rent due ; Henderson v. Stone, 1 Mart. N. 
 S. (La.) 639 (1823), contract to run horse race or to pay $500; horse died, 
 but money held due. 
 
888 OPERATION OF, CONTRACT (Ch. 4 
 
 impossible. Cases relating to the general subject could be added, 
 but those referred to which construe the contracts involved as we 
 have construed the contract under review are so convincing, so se- 
 curely rest upon right reason and justice, that additional citations 
 are unnecessary. This, as we understand, is 'the view which the 
 trial judge entertained, but he sustained the demurrer because of 
 opinion that the defense could and should be made at law.^^ * * * 
 
 We are convinced that the trial court erred in sustaining the de- 
 murrer. A decree will therefore be entered here overruling it, and 
 the cause will be remanded for trial upon the issues of fact tendered 
 by the answer. 
 
 Reversed and remanded. 
 
 TAYLOR V. CALDWEIvL. 
 
 (In the Queen's Bench, 1863. 3 Best & S. 826.) 3* 
 
 Blackburn, J. In this case the plaintififs and defendants had, on 
 May 27th, 1861, entered into a contract by which the defendants 
 agreed to let the plaintififs have the use of The Surrey Gardens and- 
 Music Hall on four days then to come, viz., June 17th, July 15th, 
 August Sth, arid August 19th, for the purpose of giving a series of 
 four grand concerts, and day and night fetes, at the Gardens and Hall 
 on those days respectively; and the plaintiffs agreed to take the 
 Gardens and, Hall on those days, and pay £100 for each day. 
 
 The parties inaccurately call this a "letting," and the money to be 
 paid, a "rent ; " but the whole agreement is such as to show that the 
 defendants were to retain the possession of the Hall and Gardens so 
 that there was to be no demise of them, and that the contract was 
 merely to give the plaintififs the use of them on those days. Nothing, 
 however, in our opinion, depends on this. The agreement then pro- 
 ceeds to set out various stipulations between the parties as to what 
 each was to supply for these concerts and entertainments, and as to 
 the manner in which they should be carried on. The effect of the 
 whole is to show that the existence of the Music Hall in the Surrey 
 Gardens in a state fit for a concert was essential for the fulfilment of 
 the contract, — such entertainments as the parties contemplated' in 
 their agreement could not be given without it. 
 
 After the making of the agreement, i and before the first day on 
 which a concert was to be given, the Hall was destroyed by fire. This 
 destruction, we must take it on the evidence, was without the fault 
 of either party, and was so complete that in consequence the concerts 
 
 33 The court then held that, while the lessee had a good defense at law, the 
 remedy, at la'* was not adequate, and that equity had jurisdiction to decree 
 rescission for mistake and failure of consideration; 
 
 3* Also reported in 32 L. J. Q. B. 164, 8 L. T. 356, 11 W. K. 726. Part of the 
 report is omitted. 
 
Sec. 6) IMPOSSIBILITY 889 
 
 could not be given as intended. And the question we have to decide 
 is whether, under these circumstances, the loss which the plaintiffs 
 have sustained is to fall upon the defendants. The parties when 
 framing their agreement evidently had not present to their minds 
 the possibility of such a disaster, and have made no express stipulation 
 with reference to it, so that the answer to the question must depend 
 upon the general rules of law applicable to such a contract. 
 
 There seems no doubt that where there is a positive contract to 
 do a thing, not in itself unlawful, the contractor must perform it or 
 pay damages for not doing it, although in consequence of unforeseen 
 accidents the performance of his contract has becolne unexpectedly 
 burdensome or even impossible. The law is so laid down in 1 Roll. 
 Abr. 450, Condition (G), and in the note (2) to Walton v. Waterhouse 
 (2 Wms. Saund. 421a, 6th Ed.) and is recognized as the general rule 
 by all the judges in the much discussed case of Hall v. Wright (E. B. 
 & E. 746). But this rule is only applicable when the contract is posi- 
 tive and absolute, and not subject to any condition either express or 
 implied; and there are authorities which, as we think, establish the 
 principle that where, from the nature of the contract, it appears 
 that the parties must from the beginning have known that it could 
 not be fulfilled unless when the time for the fulfilment of the con- 
 tract arrived some particular specified thing continued to exist, so that, 
 when entering into the contract, they must have contemplated such 
 continuing existence as the foundation of what was to be done ; there, 
 in the absence of any express or implied warranty that the thing shall 
 exist, the contract is not to be construed as a positive contract, but 
 as subject to an implied condition that the parties shall be excused 
 in case, before breach, performance becomes impossible from the 
 perishing of the thing without default of the contractor. 
 
 There seems little doubt that this implication tends to further the 
 great object of making the legal construction such as to fulfill the 
 intention of those who entered into the contract. For in the course 
 of affairs men in making such contracts in general would, ^ if it were 
 brought to their minds, say that there should be such a condition.'^ 
 
 There is a class of contracts in which a person binds himself to do 
 something which requires to be performed by him in person; and 
 such promises, e. g. promises to marry, or promises to serve for a 
 certain time, are never in practice qualified by an express exception 
 of the death of the party; and therefore in such cases the contract 
 is in terms broken if the promisor dies before fulfilment. Yet it was 
 very early determined that, if the performance is personal, the execu- 
 tors are not liable; Hyde v. The Dean of Windsor (Cro. Eliz. 552, 
 553). See 2 Wms. Exors. 1560 (5th Ed.), where a very apt illustration 
 is given. "Thus," says the learned author, "if an author undertakes 
 to compose a work, and dies before completing it, his executors are 
 
 ^5 The learned judge here indicated that the Roman law was In harmony 
 with the common law on this point, citing Dig. 4.5, 1, 33. 
 
890 OPERATION OF CONTRACT (Ch. 4 
 
 discharged from this contract ; for the undertaking is merely personal 
 in its nature, and, by the intervention of the contractor's death, has 
 become impossible to be performed." For this he cites a dictum of 
 Lord Lyndhurst in Marshall v, Broadhurst (1 Tyr. 348, 349) and a 
 case mentioned by Patteson, J., in Wentworth v. Cock (10 A. & E. 
 42, 45-46),. In Hall v. Wright (E. B. & E. 746, 749), Crompton, J., 
 in his judgment, puts another case. "Where a contract depends upon 
 personal skill, and the act of God renders it impossible, as, for in- 
 stance, in the case of a painter employed to paint a picture who is 
 struck blind, it may be that the performance might be excused." 
 
 It seems that in those cases the only ground on which the parties 
 or their executors can be excused from the consequences of the breach 
 of the contract, is, that from the nature of the contract there is an 
 implied condition of the continued existence of the life of the con- 
 tractor, and perhaps in the case of the painter, of his eyesight. In 
 the instances just given, the person, the continued existence of whose 
 life is necessary to the fulfilment of the contract, is himself the con- 
 tractor, but that does not seem in itself to be necessary to the appHca- 
 tion of the principle, as is illustrated by the following example. In 
 the ordinary form of an apprentice deed, the apprentice binds hinj- 
 self in unqualified terms to "serve until the full end and term of 
 seven years to be fully complete and ended," during which terra it 
 is covenanted that the apprentice his master "faithfully shall serve," 
 and the father of the apprentice in equally unqualified terms binds 
 himself for the performance by the apprentice of all and every cove- 
 nant on his part. (See the form, 2 Chitty on Pleading, 370 [7th Ed.] 
 by Greening.) It is undeniable that if the apprentice dies within the 
 seven years, the covenant of the father that he shall perform his 
 covenant to serve for seven years is not fulfilled, yet surely it cannot. 
 be that an action would lie against the father. Yet the only reason 
 why it would not is that he is excused because of the apprentice's 
 death. 
 
 These are instances where the implied conditio^ is of the life of a 
 human being, but there are others in which the same implication is 
 made as to the continued existence of a thing. For example, where 
 a contract of sale is made amounting to a bargain and sale, transfer- 
 ring presently the property in specific chattels, which are to be de- 
 livered by the vendor at a future day; there, if the chattels, with- 
 out the fault of the vendor, perish in the interval, the purchaser must 
 pay the price, and the vendor is excused from performing his con- 
 tract to deliver, which has thus become impossible. 
 
 That this is the rule of the English law is established by the case 
 of Rugg V. Minett (11 East, 210), where the article that perished before 
 delivery was turpentine, and it was decided that the vendor was bound ■ 
 to refund the price of all those lots in which the property had not 
 passed; but was entitled to retain without deduction the price of 
 those lots in which the property had passed, though they were not 
 
Sec. 6) IMPOSSIBILITY 891 
 
 delivered, and though in the conditions of sale, which are set out in 
 the report, there was no express qualification of the promise to de- 
 liver on payment. It seems in that case rather to have been taken 
 for granted than decided that the destruction of the thing sold before 
 delivery excused the vendor from fulfilling his contract to deliver on 
 payment. 
 
 This also is the rule of the civil law, and it is worth noticing that 
 Pothier, in his celebrated Traite du Contrat de Vente (see part 4, 
 § 307, etc. ; and part 2, ch. 1, sec. 1, art. 4, § 1), treats this as merely 
 an example of the more general rule that every obligation de certo cor- 
 pore is extinguished when the thing ceases to exist. See Blackburn on 
 the Contract of Sale, p. 173. 
 
 The same principle seems to be involved in the decision of Sparrow 
 V. Sowgate (W. Jones, 29), where, to an action of debt on an obliga- 
 tion by bail, conditioned for the payment of the debt or the render of 
 the debtor, it was held a good plea that before any default in ren- 
 dering him the principal debtor died. It is true that was the case of 
 a bond with a condition, and a distinction is sometimes made in this 
 respect' between a condition and a contract. But this observation 
 does not apply to Williams v. Lloyd (W. Jones, 179). In that case 
 the count, which was in assumpsit, alleged that the plaintiff had de- 
 livered a horse to the defendant, who promised to redeliver it on re- 
 quest. Breach, that though requested to redeliver the horse he re- 
 fused. Plea, that the horse was sick and died, and the plaintiff made 
 the request after its death ; and on demurrer it was held a good plea, 
 as the bailee was discharged from his promise by the death of the 
 horse without default or negligence on the part of the defendant. 
 "Let it be admitted," say the Court, "that he promised to deliver it 
 on request, if the horse die before, that is become impossible by the 
 act of God, so the party shall be discharged, as- much as if an obliga- 
 tion were made conditioned to deliver the horse on request, and he 
 died before it." And Jones, adds the report, cited 22 Ass. 41, in 
 which it was held that a ferryman who had promised to carry a horse 
 safe across the ferry was held chargeable for the drowning of the ani- 
 mal only because he had overloaded the boat, and it was agreed 
 that notwithstanding the promise no action would have lain had there 
 been no neglect or default on his part. 
 
 It may, we think, be safely asserted to be now English law, that 
 in all contracts of loan of chattels or bailments if the performance of 
 the promise of the borrower or bailee to return the things lent or 
 bailed, becomes impossible because it has perished, this impossibility 
 (if not arising from the fault of the borrower or bailee from some risk 
 which he has taken upon himself) excuses the borrower or bailee 
 frbm the performance of his promise to redeliver the chattel. 
 
 The great case of Coggs v. Bernard (1 Smith's L. C. 171 [Sth Ed.] 
 2 L. Raym. 909) is now the leading case on the law of bailments, and 
 Lord Holt, in that case, referred so much to the civil law that it might 
 
892 OPERATION OF CONTEACT (Ch. 4 
 
 perhaps be thought that this principle was there derived direct from 
 the civilians, ajad was not generally applicable in English law except 
 in the case of bailments ; but the case of Williams v. Lloyd (W. Jones, 
 179), above cited, shows that the same law had been already adopted 
 by the English law as early as the Book of Assizes. The principle 
 seems to us to be that, in contracts in which the performance depends 
 on the continued existence of a given person or thing, a condition is 
 implied that the impossibility of performance arising from the perish- 
 ing of the person or thing shall excuse the performance. 
 
 In none of these cases is the promise in words other than positive, 
 nor is there Einy express stipulation that the destruction of the person 
 or thing shall excuse the performance ; but that excuse is by law im- 
 plied, because from the nature of the contract it is apparent that the 
 parties contracted on the basis of the continued existence of the par- 
 ticular person or chattel. In the present case, looking at the whole 
 contract, we find that the parties contracted on the basis of the con- 
 tinued existence of the Music Hall at the time when the concerts 
 were to be given, that being essential to their j>erformance. 
 
 We think, therefore, that the Music Hall having ceased to exist, 
 without fault of either party, both parties are excused, the plaintiffs 
 from taking the gardens and paying the money, the defendants from 
 performing their promise to give the use of the Hall and gardens and 
 other things. Consequently the rule must be absolute to enter the 
 verdict for the defendants. 
 
 Rule absolute.'® 
 
 HAWKES V. KEHOE et al. 
 
 (Supreme Judicial Court of Massaebusetts, 1907. 193 Mass. 419, 79 N. E. 766, 
 10 L. R. A. [N. S.] 125, 9 Ann. Cas. 1053.) 
 
 Action by Frank E. Hawkes against Annie Kehoe and others. A 
 judgment was rendered in favor of plaintiff, and defendants bring 
 exceptions, and also appeal from an order overruling a demurrer to 
 the declaration. Order affirmed, and exceptions sustained. 
 
 Action for breach of a written contract dated May 12, 1905, by 
 which plaintiff was to convey certain land in Dorchester to defendants 
 
 s« In accord : Martin Emerich Outfitting Co. v. Siegel Cooper & Co., 237 111. 
 610, 86 N. E. 1104, 20 L. R. A. (N. S.) 1114 (1909) ; Jones-Gray Const. Co. 
 V. Stephens, 167 Ky. 765, 181 S. W. 659 (1916) : W. W. Robinson Co. t. 
 McClaine, 98 Wasb. 322, 167 Pac. 912 (1917) ; Dexter v. Norton, 47 N. T. 62, 
 . 7 Am. Rep. 415 (1871) ; Stewart v. Stone, 127 N. Y. 500, 28 N. E. 595, 14 L. R. 
 A. 215 (1891) ; Thomas v. Knowles, 128 Mass. 22 (1879) ; Appleby v. Myers, 
 L. R. 2 C. P. 651 (1867) ; Nickoll v. Asbton, [1901] 2 K. B. 126. 
 
 Where the destruction of buildings does not render performance impossible, 
 the contract duty is not discharged, even though it was expected that goods 
 were' to be made or services were to be rendered in those buildings. Hefernan 
 V. Neumond, 198 Mo. App. 667, 201 S. W. 645 (1918) ; Field & Co. v. Haven, 
 36 Cal. App. 669, 178 Pac. 108 (1918); Levy v. Caledonian Ins. Co., 15> 
 Cal. 527, lOD Pac. 598 (1909) ; Turner v. Goldsmith, [1891] 1 Q. B. 544. 
 
Sec. 6) IMPOSSIBILITY 893 
 
 and defendants were to convey certain land in Revere "and, the build- 
 ings thereon" to plaintiff, said premises to be conveyed on or before 
 June 12, 1905, "in the same condition" in which they were on May 12th, 
 "reasonable use and wear, of the buildings thereon alone excepted." 
 On the night of June 3d the buildings on the land in Revere were de- 
 stroyed by fire.. The plaintiff, on June 10th and again on June 12th, 
 demanded performance by the defendants, but the latter were unable 
 to convey the land with the buildings thereon and refusedto do any- 
 thing other than convey the land alone upon receipt of the entire 
 consideration. In the superior court a demurrer filed by defendants 
 was overruled and defendants appealed. Other facts appear in the 
 opinion. 
 
 Sheldon, J. One who has bound himself by a positive and absolute 
 agreement for the performance of something not in itself unlawful is 
 not released from his obligation by the mere fact that in consequence of 
 unforeseen accidents the performance of his contract has become un- 
 
 .expectedly burdensome or even impossible; he must respond in dam- 
 ages for the breach of .his agreement. Harvey v. Murray, 136 Mass. 
 yjT; Drake v. White, 117 Mass. 10. But it is equally well settled that 
 where from the nature of the contract it appears that the parties must 
 from the beginning have contemplated the continued existence of some 
 particular specified thing as the foundation of what was to be done, 
 then, in the' absence of any warranty that the thing shall exist, the con- 
 tract is to be construed not as a positive contract, but as subject to an 
 implied condition that the parties shall be excused in case before breach 
 perforrhance becomes impossible from the accidental perishing of the 
 thing without the fault of either party. Gray, J., in Wells v. Calnan, 
 107 Mass. 514, 516, 9 Am. Rep. 65; quoting Taylor v. Caldwell, 3 B. 
 & S. 826. The same doctrine has been affirmed in other decisions of 
 this court. Butterfield v. Byron, 153 Mass. 517, 27 N. E. 667, 12 L. 
 R. A. 571, 25 Am. St. Rep. 654; Young v. Chicopee, 186 Mass. 518, 
 72 N. E. 63; Marvel v. Phillips, 162 Mass. 399, 38 N. E. 1117, 26 L. 
 
 , R. A. 416, 44 Am. St. Rep. 370. See, also, The Tornado, 108 U. S. 
 342, 351, 352, 2 Sup. Ct. 746, 27 L. Ed. 747; Dexter v. Norton, 47 N. 
 Y. 62, 7 Am. Rep. 415; Krause v. Board of School Trustees (Ind. 
 App.) 66 N. E. 1010; Dow v. State Bank, 88 Minn. 355, 93 N. W. 121 ; 
 Vogt V. Hecker, 118 Wis. 306, 95 N. W. 90; Krell v. Henry, [1903] 2 
 K. B. 740; Hull v. Meux, [1905] 1 K. B. 580. The misfortune which 
 has occurred releases both parties from further performance of the 
 contract and gives no right to either to claim damages from the other. 
 Elliott V. Crutchley, [1903] 2 K. B. 476; s. c, [1904] 1 K. B. 565. 
 We need not stop to consider the different rules which have been laid 
 down in England and in this commonwealth as to the right of either 
 party, in such event, to recover for payments made or services rendered 
 or materials supplied to the other before further performance has be- 
 come excused. See the cases cited supra. 
 
894 OPEEATION OF CONTRACT ' '(Ch; 4 
 
 The plaintiff contends, however, that the rule which we have now 
 stated does not apply to cases like this. He claims that in this com- 
 monwealth, where a contract is made for the future conveyance of land 
 with buildings standing thereon, with no provision as to the contin- 
 gency of the buildings being destroyed by fire before the time appoint- 
 ed for the conveyance, the loss by such a fire falls wholly upon the 
 vendor. Wells v. Calnan, 107 Mass. 514, 9 Am. Rep. 65; Thompson 
 V. Gould, 20 Pick. 134. From this he deduces the conclusion that the 
 purchaser in such a case has a right either to require the vendor to 
 make a conveyance of the land with compensation for the loss of the 
 buildings, as in Phinizy v. Guernsey, 111 Ga. 346, 36 S. E. 796, SO L. 
 R. A. 680, 78 Am. St. Rep. 207, pr to hold the vendor in damages for 
 failing, though by reason of his inability, to convey the estate, includ- 
 ing both land and buildings, as he, had. agireed to do. 
 
 We need spend no time upon the numerous cases in England and in 
 this country which the industry of counsel has brought to our notice 
 as to the rights of parties to such agreements upon a total or partial 
 destruction of the buildings by fire. See the cases collected in Am. & 
 Eng. Encyc. of Eaw (2d Ed.) 712 et seql, and in 1 Ames, Cases on Eq. 
 Jur. 228, note 2. We are of opinion that in this commonwealth, when 
 as in this case, the conveyance is to be made of the whole estate, in- 
 cluding both lands! and buildings, for an entire price, apd the value 
 of the buildings constitutes a large part of the total value of the estate, 
 and the terms of the agreement show that they constituted an impor- 
 tant part of the siibject-matter of the contract, it is now settled by the 
 decision in Wells v. Calnari, 107 Mass. 514, 9 Am. Rep. 65, that the 
 contract is to be construed as subject to the implied condition that it 
 no longer shall be binding if before the time for the conveyance to be 
 made the buildings are destroyed by fire. The loss by the fire falls 
 upon the vendor, the owner ; and if he has not protected himself by 
 insurance, he can have no reimbursement of this loss ; but the contract 
 is no longer binding upon either party. If the purchaser has advanced 
 any part of the price, he can recover it back. Thompson v. Gould, 20 
 Pick. 134, 138. If the change in the value of the estate is not so great, 
 or if it appears that the buildings did not constitute so material a part 
 of the estate to be conveyed as to result in an annulling of the contract, 
 specific performance may be decreed, with' compensation for any 
 breach of agreement, or relief may be given in damages. Kares v. 
 Covell, 180 Mass. 206, 62 N. E. 244, 91 Am. St. Rep. 271 ; Davis v. 
 Parker, 14 Allen, 94. 
 
 It is true,' however, that the principle just stated would not be ap- 
 plicable to an agreement which contemplated and provided for the 
 event which has happened — if, that is, in such a case as this, the ven- 
 dor has made himself answerable for the continued existence of the 
 buildings. Allyn v. Allyn, 154 Mass. 570, 28 N. E. 779. The agree- 
 ment in this case provides that the defendants shall convey to the 
 
Sec. 6) IMPOSSIBILITY 895 
 
 plaintiff a certain parcel of land "and the buildings thereon," and that 
 the premises at the time of delivering the deeds are to be "in the same 
 condition in which they now are, reasonable use and wear of the build- 
 ings thereon alone excepted." The plaintiff contends that these words 
 were inserted for his protection (Tripp v. Smith, 180 Mass. 122, 126, 
 61 N. E. 804) ; that they constitute a part of the contract, and are not 
 to be ignored ; and that they are no less applicable when the buildings 
 have been totally consumed than would be the case if they simply had 
 been mutilated by tenants or charred by a small fire. And he claims 
 that the exception of "reasonable use and wear of the buildings" 
 furnishes an additional reason for holding that injury by inevitable ac- 
 cident is not excepted. Harvey v. Murray, 136 Mass. 377, 378. 
 
 Accordingly he contends that he has a right to hold the defendants in 
 damages. for their failure to convey to him the estate with the buildings, 
 in the same condition that they were in at the date of the contract. 
 Combs V. Fisher, 3 Bibb (Ky.) 51 ; Green v. Kelly, 20 N. J. Law, 544; 
 Goddard v. Bedout, 40 Ind. 114; Morgan v. Hymer (Ky.) 37 S. W. 
 576. But of these cases Combs v. Fisher simply decides that after the 
 vendor has recovered a jiidgment at law against the purchaser upon 
 bonds given for the price for the land and buildings, thus aiifirming the 
 contract, the latter may in equity have his damages from the prior de- 
 struction of the buildings set off against such judgment. In Goddard 
 V. Bedout, the defendant had put himself in the position of a lessee, 
 and it is pointed out in Wells v. Calnan, 107 Mass. 514, 517, 518, 9 
 Am. Rep. 65, that cases in which a lessee is held to pay rent or make 
 repairs notwithstanding the destruction of the buildings during the 
 term are not applicable here. In Morgan v. Hymer there was an ex- 
 press covenant by the vendor to keep the house in good repair. Green 
 V. Kelly, the only one of these cases which fully supports the plain- 
 tiff's position, was rested mainly upon the authority of cases as to 
 tenants, which we have seen not to be applicable here. There is here 
 no express agreement on the part of the vendors warranting the con- 
 tinued existence of the buildings on their land, and no provision relative 
 to their destruction by fire, as there was in Allyn v. Allyn, 154 Mass. 
 570, 28 N. E. 779. The agreement seems rather to have been based 
 upon the assumption that its subject-matter, land and buildings, would 
 continue in existence until the time should arrive for the making of 
 the conveyance and to provide against any change in their condition 
 while so existing being made or allowed by the vendors to the possible 
 detriment of the purchaser. The parties contemplated this continued 
 existence as the foundation of their agreement. It is as if in the case 
 of Dexter v. Norton, 47 N. Y. 62, 7 Am. Rep. 415, there had been in- 
 serted in the agreement a stipulation that the seller would not allow 
 the cotton therein mentioned to become wet by salt water or depreciated 
 in quality from other causes, but would deliver it in sound condition. 
 All the reasoning in the opinion of the court in that case would re- 
 
896 OPERATION OF CONTRACT (Ch. 4 
 
 main unaffected and the decision must have been the same. In Howell 
 V. Coupland, 12 Q..B. D. 258, the contract was for the future sale of 
 certain potatoes, "to be good and marketable ware" ; and this contract 
 was held to be subject to the implied condition that the parties should 
 be excused if before breach performance became impossible from the 
 perishing of the potatoes without default of the contractor. This 
 case must stand in the same way as if a large and material part of the 
 land had been swallowed up by an earthquake or some other convul- 
 sion of nature, perhaps leaving some of the buildings standing on what 
 land was left ; for Wells v. Calnan, ubi supra, has settled the rule in 
 this commonwealth that the destruction of the buildings is not to be 
 distinguished from the loss of a material part of the laiid. , All the 
 arguments based upon this stipulation of the contract would be as ap- 
 plicable then as now; evidently they could not then avail, and they 
 cannot avail now. 
 
 We need not consider the question whether it appeared that the 
 plaintiff, having made no actual tender of performance and having no 
 ether ability to pay the necessary money than stated in the auditor's re- 
 port, had put himself in a condition to maintain the action. Apparently, 
 if the defendants had adopted the plaintiff's view, and had offered to 
 make a conveyance to him with compensation for the loss of the build- 
 ings, he could not have obtained the money upon the proposed mort- 
 gage, for his arrangement with the intended mortgagor was based upon 
 the contingency of the defendant's premises being conveyed in the 
 condition in which they were when the agreement was signed. See 
 Foternick v. Watson, 184 Mass. 187, 68 N. E. 215 ; Lowe v. Harwood, 
 139 Mass. 133, 135, 29 N. E. 538; Gormley v. Kyle, 137 Mass. 189; 
 Carpenter v. Holcomb, 105 Mass. 280, 285 ; Cook v. Doggett, 2 Allen, 
 439, 441; Butterick v. Holden, 8 Cush. 233; Howland v. Leach, 11 
 Pick. 151, 155. 
 
 The demurrer was rightly overruled. The first count simply sets 
 out the agreement and avers that the plaintiff was ready and willing 
 to carry it out and so notified the defendants, but they "fiatly refused" 
 to perform on their part. The second count avers in substance that 
 the fire which destroyed the buildings was due to the defendants' neg- 
 ligence ; and it also, like the first count, contains an averment that the 
 defendants flatly refused to perform their agreement. 
 
 The order overruling the demurrer must be affirmed; and because 
 of the failure to grant the first of the defendants' requests for instruc- 
 tions, the exceptions must be sustained. 
 
 So ordered. 
 
Sec. 6) IMPOSSIBILITY 897 
 
 C. G. DAVIS & CO. V. BISHOP. 
 (Supreme Court of Arkansas, 1919. ; 139 Ark. 273, 213 S. W. 744.) 
 
 Action by C. G. Davis & Co. against, G. W. Bishop. From the judg- 
 ment for defendant, gjaintiff appeals. Affirmed. 
 
 Hart, J. C. G. Davis & Co. sued G. W. Bishop to recover damages, 
 which they alleged they sustained by reason of the breach of a contract 
 by Bishop to sell and deliver to them a certain number of bales of cot- 
 ton. 
 
 At the conclusion of the. evidence, the court directed the jury to re- 
 turn a verdict in favor of the defendant, and from the judgment ren- 
 dered the plaintiffs, have duly prosecuted an appeal to this court. 
 
 The only issue raised by the appeal is whethef or not the trial court 
 erred in directing a verdict for the , defendant tinder the evidence ad- 
 duced by the plaintiffs. Hence it will only be necessary to abstract 
 the testimony of the plaintiff's. 
 
 C. G- Davis & Co. is a firm of cotton buyers at Texarkana, Tex., 
 and has been engaged in that business for several years. G. W, Bish- 
 op owned a large cotton plantation in Miller county, Ark., and usually 
 planted about, 1,000 acres in cotton. About the 1st of August, 1917, 
 C. G. Davis, the senior member of the firm, and G. W. Bishop had a 
 conversation about the advisability of the latter's selling at that time a 
 part of the cotton which was being grown on his plantation during 
 that year. They agreed that it would be a good thing for Bishop to do 
 this. Bishop told Davis that he had 1,000 acres in cotton and usbally 
 made 500 or 600 bales. On the 1st day of August, 1917, they entered 
 into a contract for the sale by Bishop to C. G. Davis & Co. of 300 
 bales of the cotton at 24i/^ cents a pound. The cotton was already 
 growing on Bishop's farm in Miller county. Ark., and was to be deliv- 
 ered at Texarkana, Tex.j during the months of October, November, 
 and December of that year. 
 
 In contracts of that kind it was tlie custom for the planter to deliver 
 the number of bales sold out of the first cotton picked by him. Dur- 
 ing the fall Bishop picked 219 bales of cotton on his farm and delivered 
 the same to C. G. Davis & Co., who paid him the contract price there- 
 for. Bishop failed to deliver to Davis & Co. any more cotton^ and 
 they brought this suit in order to recover damages which they allege 
 they sustained on account of his , failure to deliver to them any more 
 cotton. It was shown by Bishop that he delivered to them all the 
 cotton that he grew on his farm in Miller county, Ark., during that 
 year. 
 
 The court did not err in directing a verdict for the defendant. It is 
 true, as contendedby counsel for the plaintiffs, that the general rule is 
 that, when the contract is to do a thing which in itself is possible, the 
 promisor will be liable ior a breach thereof, notwithstanding it was 
 Ijeyond his power to perforin it. The reason is that it was his own 
 
 COBBIN CONT 57 
 
898 OPERATION OF CONTEACT (Ch. 4 
 
 fault to run the risk of undertaking to perform an impossibility, when 
 he might have provided against it by his contract. ■ There are, how- 
 ever, well-known exceptions to this general rule, and one of them is 
 that, where from the contract it is apparent that the parties contracted 
 on the basis of the continued existence of a given thing, a condition is 
 implied that, if the performance became impossible from the perishing 
 of the thing, that shall excuse the performance. 
 
 In the instant case, according to the evidence adduced by the plain- 
 tiffs, the defendant agreed to sell to the plaintiffs 300 bales of cotton 
 which were growing on his farm in Miller county. Ark. The contract 
 was executed on the 1st day of August. The defendant had planted 
 1,000 acres in cotton, and that number of acres usually made 500 or 
 600 bales of .cotton. Xhe contract related to the crop to be grown by 
 the defendant on the latter's farm in Miller county. Under these cir- 
 cumstances the performance of it, in the contemplation of both par- 
 ties, depended upon the future growth and continued existence of the 
 cotton. 
 
 The defendant delivered to the plaintiffs all the cotton that grew on 
 the farm, and he was therefore excused from a further performance 
 of the contract. 
 
 According to the plaintiffs' own testimony it was the intention of 
 the defendant to sell him a part of the crop which was growing on his 
 plantation in Miller county, and under the circumstances the designa- 
 tion of 300 bales was a mere statement of opinion as to the quantity, 
 and cannot be regarded as a warranty that the defendant would raise 
 that dumber of bales. Of course, if the defendant by the terms of the 
 contract had warranted that he would raise 300 bales of cotton, he 
 would be bound by the terms of his warranty, notwithstanding on ac- 
 count of weather conditions or other matters over which he had no 
 control he failed to raise the designated number of bales. Here, we 
 have already seen, it appears from the plaintiffs' testimony that it was 
 the intention of the parties that the cotton should be grown on the 
 defendant's own farm, and it is plain that the number of bales was 
 specified in the contract for the purpose of limiting the quantity sold 
 to that amount. Switzer v. Pinconning Mfg. Co., 59 Mich. 488, 26 N. 
 W. 762 ; Rice & Co. v. Weber, 48 111. App. 573 ; and Ontaiio Decidu- 
 ous Fruit Growers' Association v. Cutting Fruit Packing Co., 134 Cal. 
 21, 66 Pac. 28, 53 L. R. A. 681, 86 Am. St. Rep. 231. 
 
 In the last-mentioned case the court held that under a contract for 
 the sale of the crop of a certain orchard, stating the minimum quantity 
 of the fruit to be delivered, the seller cannot be held liabLe in damages 
 for failure to deliver the specified quantity because of the failure of 
 the crop due to unusual climatic conditions ; nor can he be compelled 
 to substitute other fruit for that contemplated in the contract. 
 
 In a case note to L. R. A. 1916F, at page 63, in discussing the ques- 
 tion of intervening impossibility of performance of a contract as a de- 
 fense to an action for the breach thereof, it is said : 
 
Sec. 6) IMPOSSIBILITY 899 
 
 "Whether or not a contract for the sale of produce to be delivered 
 at a certain future date contemplates that it shall be grown on a par- 
 ticular tract of land, so that a failure of the crop on that' land will 
 excuse a nondelivery, is often a close question of construction of the 
 particular contract. The rule appears to be that if the parties contem- 
 plate a sale of the crop, or of a certain part of the crop, of a particular 
 tract of land, and, by reason of a drought, or other fortuitous event, 
 without the fault of the promisor, the crop on that land fails or is 
 destroyed, nonperformance is to that extent excused, the contract, in 
 the absence of an express provision controlling the matter, being 
 * * * subject to an implied condition in this regard, but that, if 
 the contract does not specify or contemplate the crop of any particular 
 tract of land, nonperformance will not be excused merely because it 
 happens that, on account of a drought or other fortuitous event, with- 
 out his fault, the promisor is unable to perform the contract, the cases 
 following in this respect the general rule previously indicated that the 
 mere inability of the obligor to perform will not generally excuse non- 
 performance." 
 
 It follows that the judgment must be affirmed.^' 
 
 LOUISVILLE, & N. R. CO. v. CRQWE. 
 
 (Court of Appeals of Kentucky, 1913. 156 Ky. 27, 160 S. W. 759, 49 U E. 
 
 A. [N. S.] 848.) 
 
 Action by M. B. Crowe against the Louisville & Nashville Rail- 
 road Company. From a judgment for plaintifif, defendant appeals. 
 Affirmed. 
 
 Hannah, J. Appellee sued appellant in the Allen circuit court al- 
 leging that in consideration of the Chesapeake & Nashville Railroad 
 Company, its successors and assigns, agreeing to issue to him an 
 annual pass during his natural life, good between Scottsville, Ky., 
 and Gallatin, Tenn., he had on April 2, 1898, conveyed to it for a 
 right of way a strip of land through his farm, 100 feet in width and 
 1,000 yards in length; that thereafter defendant, Louisville & Nash- 
 ville Railroad Company, had purchased the said Chesapeake & Nash- 
 ville Railroad Company, and was operating its line of railway over 
 said right of way; that said Chesapeake & Nashville Railroad Com- 
 pany, in compliance with said agreement contained in said deed, had 
 each year during the time it owned and operated said railroad issued 
 to him the annual pass therein agreed to be issued, good between 
 the points above mentioned; and defendant, Louisville & Nashville 
 
 s'^ In accord : Howell v. Coupland, 1 Q. B. D. 258 (1876) ; St. Joseph Hay 
 & Feed Co. v. Brewster (Mo. App.) 195 S. W. 71 (1917). Circumstances of 
 this sort are no defense where the subjpct-matter is not required toi be grown 
 on a specific tract of land. Anderson v. May, 50 Minn. 280, 52 N. W. 530, 
 17 L. B. A. 555, 36 Am. St. Kep. 642 (1892). See, further, ante, 686, note. 
 
90Q OPERATION OF CONTRACT (Ch. i 
 
 Railroad Company, since January 18, 1907, had lik&yvise during each 
 year it had owned said railroad issued such pass to -him, up and 
 until 1911, at which time defendant recalled a pass which it had is- 
 sued to him for that year, and refused to issue another, good be- 
 tween said points. The plaintiff (appellee here) sought specific per- 
 formance of the contract if the same could be had; and,, if not, then 
 he prayed for damages in the sum of $500. 
 
 The defendant filed a demurrer to the petition, and same was over- 
 ruled, the court below holding that the case of L. & N. R. R. Co. v. 
 Mottley, 219 U. S. 467, 31 Sup. Ct. 265, 55 L. Ed. 297, 34 L. R. A. 
 (N. S.) 671, decided February 20, 1911, was conclusive upon the 
 question of the duty of the railroad company to withhold the annual 
 pass, under tlae act of Congress entitled "An act to regulate com- 
 merce," approved February 4, 1887, as amended by the act approved 
 June 29, 1906, known as the Hepburn Bill; but further holding 
 that the petition stated sufficient grounds for the recovery of dam- 
 ages in lieu of specific performance. The defendant, relying on said 
 act of Congress, in discharge of all Hability upon its part, alleged 
 that it had tendered to plaintiff, and was still willing to issue to him, 
 an annual pass over its road from Scottsville, Ky., to the Tennessee 
 line. The action was brought in equity. The defendant failed to 
 take any proof, and the case was tried by the court upon the plead- 
 ings and the depositions taken by plaintiff; the court rendering judg- 
 ment in favor of plaintiff against defendant in the sum of $200, 
 from which judgment this appeal is prosecuted. 
 
 The Mottley Case, above mentioned, is conclusive upon the ques- 
 tion of plaintiff's right to have specific performance of the contract 
 sued on ; but in that case the Supreme Court said : "Whether, 
 without enforcing the contract in suit, the defendants in error may, 
 by some form of proceeding against the railroad company, recover 
 or restore the rights they had when the railroad collision occurred, 
 is a question not before us, and we express no opinion on it." This 
 question has not heretofore been passed upon by this court. And 
 we have been cited to no case involving the right of one party to a 
 contract to recover damages for the thing taken and retained by the 
 other party, where such other party has been prevented from per- 
 forming his part of the contract by the enactment of a law, subse- 
 quent to the execution of the contract, making the continuance of 
 said contract unlawful, where the contract in question was lawful 
 when it was entered into. Nor have we been able to find any au- 
 thority on this subject except the case of Cowley v. Northern Pacific 
 Ry. Co. (1912) 68 Wash. 558, 123 Pac. 998, 41 L. R. A. (N. S.) 559, 
 which is almost identical with the one at bar, and which denies the 
 right of recovery of damages on such contracts as this. However, 
 we do not feel bound by that decision. 
 
 Appellant cites a number of suthorities holding that, to the general 
 rule that a party to a contract is not discharged by subsequent ini- 
 
Sec. 6) iMrossiBiLiTY 901 
 
 possibility of performance, there is the exception that, where the 
 performance becomes impossible by law, either by reason of a change 
 in the law, or by some action by or under the authority of govern- 
 ment, the/promisor is excused. But these authorities merely hold 
 that it is a general rule of law that where a contract is lawful when 
 made, and a subsequent enactment renders performance of it unlaw- 
 ful, neither party shall be prejudiced, and the contract is at an end. 
 They do not hold that one party can take the property of another 
 under a promise to pay for it, and still hold it, and not pay for it, 
 if, by reason of an enactment of law after the contract is made, such 
 party is prohibited from making payment in the article he contract- 
 ed to pay with. And if those cases did so hold, we would be inclined 
 to disagree with them. The party obtaining the property in this 
 way should be required to restore it, or to pay for it upon equitable 
 terms. 
 
 Here, appellee in good faith conveyed and delivered up the posses- 
 sion of his land, in consideration of the promise of his vendee to 
 pay for same in a particular thing, an annual pass. This was in ef- 
 fect a contract to pay appellee the purchase price of his land in annual 
 installments, during the remainder of his life, instead of in one lump 
 sum at the time of the execution of the deed ; and, to pay said pur- 
 chase price of his land in transportation over the said line of rail- 
 road, rather than in cash, or other medium of exchange. This con- 
 sideration has not been fully paid. The medium of payment in said 
 deed provided for and agreed upon is no longer of permissible use, 
 by reason of the act of Congress above mentioned as construed by 
 the Supreme Court of the United States in the Mottley Case; but, 
 rather than do the appellee the injustice of declaring a forfeiture of 
 the unfulfilled contract by a release and discharge of appellant from 
 all liability thereunder, some other medium of payment should 
 in good conscience be substituted for the medium which is no longer 
 available; or appellee should recover or be restored to the rights 
 he had when the said deed was executed by him. 
 
 In this case, it would not be equitable to restore to appellee the 
 land taken and retained; nor could this now be done, the rights of 
 the public having intervened. The equitable way to adjust the matter 
 is to require appellant to pay to appellee a reasonable sum, based, 
 not on the probable value of what he would have received thereunder 
 for the remainder of his life, nor upon a breach of the contract, but 
 for the right of way so takeri and necessarily retained; taking into 
 consideration, of course, what appellee has already received under 
 the contract. 
 
 From the evidence in this case, we think the lower court did this, 
 and the judgment is therefore afifirmed.^^ 
 
 *' Nonperformanqe creates no right to damages in case performance has 
 been made illegal by a change in the domestic law. Louisville & N, R. R. 
 
902 OPERATION OF CONTRACT (Gh. 4 
 
 PASQUOTANK & N. R. STEAMBOAT CO. v. EASTERN 
 CAROLINA TRANSP. CO. 
 
 (Supreme Court of North Carolina, 1914. 166 N. C. 582, 82 S. E. 956.) 
 
 Action by the Steamboat Company against the Transportation 
 Company. From a judgment of nonsuit, plaintiff appeals. Reversed, 
 and new trial ordered. 
 
 It appeared in evidence that plaintiff had entered into a contract 
 with defendant, in part as follows : 
 
 "Witnesseth, that .wliereas the said party of the first part is the 
 owner of the steamship Virginia, fully manned and equipped for 
 carrying passengers and freight; and, whereas the party of the sec- 
 ond part is desirous of chartering said steamship for its use on certain 
 Sundays only, in carrying passengers and freight from. Elizabeth City, 
 North Carolina, to Nags Head, North Carolina, and return to Eliza- 
 beth, City, North Carolina : Now, therefore, it is agreed by and be- 
 tween the parties hereto in consideration of one dollar and other good 
 and sufficient consideration, not herein mentioned, in hand paid, and 
 moving from each to the other of them, as follows, to wit : (1) That 
 the said party of the first part hereby leases and charters to the said 
 party of the second part the said steamship Virginia fully manned 
 and equipped for each Sunday during the period or term' beginning 
 Sunday, June 23, 1912, and ending bunday, September 29, 1912, both 
 Sundays, inclusive ; and the said party of the spcond part is to pay to 
 the said party of the first part for the use of said steamship on said 
 Sundays the sum of eighty dollars ($80) per Sunday, payable on the 
 1st and 15th of each month after said steamship has been so used by 
 said party of the second part during said term." 
 
 Co. V. Mottley, 219 U. S. 467, 31 Sup. Ct. 265, 55 L. Ed. 297, 34 L. E. A. (N. 
 S.) 671 (1911) ; Cowley v. N. P. R. R. Co., 68 Wash. 558, 123 Pac. 998, 41 
 L. R. A. (N. S.) 559 (1912) ; Cordes v. Miller, 39 Mich. 581, 33 Am. Rep. 
 430 (1878) , erection of wooden building forbidden by law ; Brick Presbyterian 
 Church Corp. v. Mayor, etc., of City of New York, 5 Cow. (N. T.) 538 (1826), 
 law forbade use as a cemetery; American Mercantile Exch. v. Blunt, icfe 
 Me. 128, 66 Atl. 212, 10 L. R. A. (N. S.) 414,. 120 Am. St. Rep. 463, 10 Ann. 
 Cas. 1022 (1906) ; Bell v. Kanawha Traction & Electric Co., 83 W. Va. 640, 98 
 S. E. 885 (1919) ; MoUer v. Herring, 255 Fed. 670, 167 C. C. A. 46, 3 A. L. R. 
 624 (1919), subject-matter taken into possession of a receiver; Marshall v. 
 Glanvill, [1917] 2 K. B. 87, employee required by law to enter military service; 
 Commonwealth v. Overby, 80 Ky. 208, 44 Am. Rep. 471 (1882), delivery of 
 accused by his bail rendered imjwssible by imprisonment for another offense ; 
 Hanford v. Connecticut Fair Ass'n, 92 Conn. 621, 103 Atl. 838 (1918), epidemic 
 of disease made performance contrary to public welfare. See, also, Baily v. 
 De Crespigny, L. R. 4 Q. B. 180 (1869). 
 
 It has been held that a contractor takes the risk of impossibility due to 
 foreign law. Barker v. Hodgson, 3 M. & S. 267 (1814). See Ford v. Cotes- 
 worth, L. R. 5 Q. B. 544 (1870) ; Cunningham v. Dunn, 3 C. P. D. 443 (1878). 
 
 The denial of a necessary dty license does not discharge a contractor, al- 
 though performance may be illegal without it. It was his duty to procure the 
 license. Gravel Switch & L. S. Tel. Co. v. Lebanon L. & L. Tel. Co., 139 Ky. 
 151, 129 S. W. 559 (1910). Cf. Monaca Borough v. Monaca St. R. Co., 247 Pa. 
 242, 93 Atl. 344 (1915). 
 
Sec. 6) IMPOSSIBILITY 903 
 
 And, further: 
 
 "(7) It is further understood and agreed by and between the parties 
 hereto that if on any of said Sundays the weather should be so bad 
 that said steamship could not safely make said trip and land its pas- 
 sengers at Nags Head, then said steamship shall not make said trip 
 on said day, and the said party of the second part 'will not be required 
 to pay for said day the eighty dollars ($80) above herein mentioned." 
 
 The evidence showed that pursuant to this contract the steamer 
 was supplied for the purpose indicated until August 4, 1912, when it 
 was totally destroyed by fire. It was admitted that plaintiff had been 
 paid for all the trips made to that time except those of July 21st and 
 July 28th, and for the same no payment had been made. Defendant 
 resisted recovery, claiming, first, that the contract was entire, and 
 plaintiff had no right of action without showing full performance for 
 the whole period of time covered by the contract. Defendant further 
 set up a counterclaim: against plaintiff by reason of failure to perform 
 on its part. At the close of the testimony, a motion to nonsuit plain- 
 tiff's demand was allowed, and, defendant having then withdrawn his 
 counterclaim, a judgment of nonsuit was duly entered, and plaintiff 
 excepted and appealed. 
 
 HokE, J. (after stating the facts as above). Where parties contract 
 with reference to specific property and the obligations assumed clearly 
 contemplate its continued existence, if the property is accidentally 
 lost or destroyed by fire or otherwise, rendering performance impos- 
 sible, the parties are relieved from further obligations concerning it. 
 As to the executory features of such an agreement, the destruction 
 of the property, without fault, will amount to a discharge of the con- 
 tract. 3 Page on Contracts, § 1730; Clark on Contracts (2d Ed.) p. 
 475. 
 
 Under the circumstances as stated and in reference to the adjust- 
 ment of rights arid liabilities of the parties by reason of stipulations 
 already performed, if the contract in express terms or from its nature 
 is entire and indivisible, requiring full performance before anything 
 is due, then no recovery can be had, but, if the contract is severable 
 and substantial benefit has been received under it and enjoyed by 
 one of the parties, this must ordinarily be accounted for, either ac- 
 cording to the rates fixed by the contract or under a quantum meruit, 
 as the case may be, and if, under the terms of the contract, the work 
 done or the services rendered are to be paid for by installments or at 
 stated periods, these installments or payments being fixed with re- 
 gard to the value of the work done or as specified portions are per- 
 formed, in that event, if the property is destroyed, the claimant may 
 recover for the installments due or for the portion of the work done 
 as for an amount already earned. 
 
 These genei"al principles are in accordance with decided cases here 
 and in other jurisdictions. Keel v. Construction Co., 143 N- C. 429- 
 432, 55 S. E. 826 ; Tussey v. Owen, 139 N. C. 457, 52 S. E. 128 ; Coal 
 
904 OPERATION OP CONTRACT • (Ch. 4 
 
 Co. V. Ice- Co., 134 N. C. 574, 47 S. E. 116; Lawing v. Rintles, 97 
 N. C. 350, 2 S. E. 252; ChamBlee v. Baker, 95 N. C. 98; Gorman v. 
 Bellamy, 82 N. C. 496; Brewer v. Tysor, 50 N. C. 173; Viterbo v. 
 Friedlander, 120 U. S. 707, 7 Sup. Ct. 962, 30 L. Ed. 776; McCaslin 
 V. Mfg. Co., 155 Ind. 298, 58 N. E. 67; Dexter v. Norton, 47 N. Y. 
 62, 7 Am. Rep. 415 ; Wells v. Calnan, 107 Mass. 514, 9 Am. Rep. 65 ; 
 Stewart v. Stone, 127 N. Y. 500, 28 N. E. 595, 14 L. R. A. 215, and 
 the two cases of Lawing v. Rintles, supra, and Keel v. Construction 
 Co. very well illustrate the different positions as applied to the facts 
 of the present appeal. In Lawing's Case, a contract to construct cer- 
 tain buildings as a whole was held to be entire and, on accidental de- 
 struction of buildings before completion, it was held that the con- 
 tractor could not recover any portion of the price. In the later case of 
 Keel V. Construction Co., the contract was to construct a building; the 
 payment to be by certain installments due as specified portions of the 
 structure were completed; the apportionment having evident reference 
 to the portion of the work done, and, in the opinion, the general prin- 
 ciples applicable were stated as follows : 
 
 "When one contracts with the owner of a lot to furnish all the mate- 
 rials and build and construct a house thereon for a certain price, the 
 contract being' entire and indivisible, .if the structure, before comple- 
 tion, is destroyed by fire, without fault on the part of the owner, and 
 the contractor, being given the opportunity, refuses to proceed further, 
 in such case, he is liable to refund any money which may have been 
 paid him on the contract, and also for damages for its nonperformance. 
 Brewer v. Tysor, 48 N. C. 181 ; Eawing v. Rintles, 97 N. C. 350, 2 
 S. E. 252; Beach's Modern Eaw of Contracts, § 232, citing Tompkins 
 v. Dudley, 25 N. Y. 272, 82 Am. Dec. 349. And this principle will 
 not be affected by the fact that the money is to be paid by installments, 
 if the price is entire for a completed building and these installments 
 are arbitrary and fixed without any regard to the value of any dis- 
 tinctive portion of the work done. School Trustees v. Bennett, 27 N. 
 J. Law, 513, 72 Am. Dec. 373. But, if the contract is divisible and 
 severable, if the price is not entire for a completed building, but is pay- 
 able by installments, these installments being fixed with regard to the 
 value of the work done, or as certain. portions of, same are finished, in 
 that event, if the structure be destroyed by inevitable accident, ,'the 
 builder is entitled to recover for the installments which have been fully 
 earned,' but it seems that he has no claim for a proportional part of 
 the next installment which has been only partially earned. Brewer v. 
 Tysor, 50 N. C. 173 ; Beach, Modern Law, citing Richardson v. Shaw, 
 1 Mo. App. 234. In this well-considered case, Lewis, Judge, delivering 
 the opinion, says: 'The true principle which controls such a case as 
 this is clearly stated in Addison on Contracts, 452 : "If the contract 
 price of the building is to be paid by installments on the completion of 
 certain specified portions of the work, each installment becomes a debt 
 
Sec. 6) iiyEPOSSiBiLiTY 905 
 
 due to the builder as the particular portion specified is completed ; and, 
 if the house is destroyed by accident, the employer would be bound to 
 pay the installments then due, but would not be responsible for the in- 
 termediate work and labor and materials." ' " 
 
 . And such in effect is the cas* presented here, the contract showing 
 that plaintiff was to be paid "$80 per Sunday, payable on the 1st and 
 15th of each month, after such steamship has been so used by said 
 party of the second part during said term," and, in' further support 
 of the position that the price per Sunday was to be regarded as a sever- 
 able item, it is provided further in the contract that in case the weather 
 was such as to prevent the trip on any given Sunday, the stipulated 
 price for such day was not to be required. 
 
 On the facts in evidence, therefore, the plaintiff, in any aspect of 
 the case, had a definite claim for $160, earned under the provisions of 
 the contract, which entitled him to bring suit and, if defendant desires 
 to insist that it has been wronged by plaintiff's failure to perform fur- 
 ther, the position should be made available by counterclaim, the course 
 suggested and approved in some of the authorities cited. See Coal Co. 
 v. Ice Co., 134 n! C. 579, 47 S. E. 116; Chamblee v. Baker, supra; 
 Gorman v. Bellamy, supra. 
 
 In reference to this counterclaim of defendant, it may be well to 
 note that the obligations of an ordinary business contract are impera- 
 tive in their. nature. This principle, which relieves a party to such a 
 contract by reason of the destruction of the property with which it 
 deals, is sometimes treated as an exception ; the general rule being the 
 other way. 9 Cyc. pp. 627-629. Before a party can avail himself of 
 such a position, h'e is required to show that the property was destroyed, 
 and without fault on his part. For this reason, and, further, because 
 by the terms of the present contract the care and custody of the 
 property was left with plaintiff, if it is established that plaintiff has 
 failed to further perform the executory features of this agreement, the 
 burden would be on plaintiff to show that the steamer was destroyed 
 by fire, and that the plaintiff and its agents were in the exercise of 
 proper care at the time. 
 
 For the reasons heretofore given, the judgment of nonsuit must be 
 set aside and a new trial had. 
 
 New trial. 
 
906 OPERATION OF CONTRACT (Ch. 4 
 
 CARROLL V. BOWERSOCK. 
 
 (Supreme Court of Kansas, 1917. 100 Kan. 270, 164 Pae. 143, L. R. A. 
 
 1917D, IQflG.) 
 
 Action by Martin Carroll, doing business as the Martin Carroll 
 Company, against J. D. Bowersock, doing business as the Lawrence 
 Paper Manufacturing Company. Judgment for plaintiff, and defend- 
 ant appeals. Reversed, and cause remanded, with directions. 
 
 The contract required the plaintiff to construct a reinforced con- 
 crete floor in a warehouse, for $1,825, payable in certain installments. 
 The building was destroyed by fire after the footings were laid and 
 the forms constructed for pouring in the concrete for columns. The 
 reinforcing rods were in position, but not attached to the building. 
 No installment was yet due. 
 
 BuRCH, J.^' The action was one to recover for part performance 
 of a contract to construct a reinforced concrete floor in a warehouse, 
 which was destroyed by fire before the floor was completed. The plain- 
 tiff recovered, and the defendant appeals. * * *' 
 
 The court stated the following findings of fact and conclusion of 
 law: 
 
 "Findings of Fact. 
 
 "The plaintiff entered upon the performance of the work in harmony 
 with said contract, and worked for about three weeks. Before com- 
 mencing the work he procured 
 
 Blueprints to be prepared therefor by an engineer at an expense of . . $ 85 00 
 Prior to the fire hereinafter mentioned he actually used of the steel 
 
 for reenforcement in value 248 63 
 
 Labor for forms for cement , " " 28 80 
 
 Hardware " " 4 80 
 
 Cement " " 23 20 
 
 Sand and rock " " 17 20 
 
 Labor " " 319 90 
 
 Some miscellaneous items ..,. " " 3 65 
 
 Expended for drayage " " 3 15 
 
 Blacksmithing " " 6 50 
 
 In addition to these he paid freight on tools " " 7 25 
 
 Railroad fare for men . . .• " " 5 95 
 
 •^'The reasonable value of superintending the work and for use of 
 tools is 10 per cent, of the cost of the material and work actually used 
 in the improvement. 
 
 "At the end of the third week, the building was totally destroyed 
 by fire, without fault of either party to the contract. It was insured 
 in the condition in which it was before the plaintiff commenced work, 
 but there was no insurance upon the improvements made by the plain- 
 tiff. The defendant collected the insurance, and failed and refused to 
 reconstruct the building upon demand of the plaintiff, so that it was 
 impossible for the plaintiff to complete his contract. 
 
 ^^ Parts of the opinion are omitted. 
 
Sec. 6) IMPOSSIBILITY 907 
 
 "Conclusion of Law. 
 
 "The plaintiff in this case should recover from the defendant a 
 
 judgment for $698.09, the same being made up as follows : 
 
 Steel actually used $248 63 
 
 Lumber used 28 80 
 
 Hardware used 4 80 
 
 Cement used 23 00 
 
 Cost of drayage 3 15 
 
 Cost of blacksmithing 6 50 
 
 Cost of sand and rock 17 20 
 
 Cost of superintending and use of tools 63 46 
 
 Money paid, for labor and miscellaneous items 323 55 , 
 
 $698 09" 
 
 Nit is apparent that the court permitted recovery for substantially 
 what the plaintiff had done by way of performance of the contract 
 before the fire. 
 
 The contract was to place the floor in a specific warehouse. De- 
 struction of the warehouse without fault of either party put an end 
 to construction of a floor in that warehouse. No warehouse except the 
 one destroyed having been contemplated or contracted about, the de- 
 fendant could not be charged with delinquency for not building an-? 
 other. To do so would be to charge him with breach of an obUgation 
 which he did not assume. If continued .existence of the particular 
 warehouse to which the, contract related were not taken for granted 
 by both parties, the plaintiff would be bound by his contract and could 
 not recover at all ; no concrete floor, having been constructed. 
 
 It was not material that the defendant collected insurance on the 
 warehouse, purchased before the contract was made. The insurance 
 covered nothing but property of the defendant. He paid for the in- 
 surance and was entitled to it, just as the plaintiff would have been 
 entitled to insurance on his property had he seen fit to insure. If any 
 part of the plaintiff's labor and material was incorporated into the in- 
 sured building, so that the insurance covered it as substance of the 
 structure, the plaintiff can recover, if at all, not because of the insur- 
 ance, but because of the incorporation. 
 
 If a contractor should engage to furnish all labor and material and 
 build a house, and the house should burn before completion, the loss 
 falls on him. If a contractor should engage to refloor two rooms of 
 a house filready in exis'tence, and should complete one room before the 
 house burned, he ought to be paid something. So far the authorities 
 are in substantial agreement. 
 
 The principle upon which the contractor may recover in a case of the 
 character last instanced has been variously stated. Sometimes it is 
 said that it was a niaterial and substantive part of the contract on the 
 owner's side that he would have the house in existence as long as might 
 be necessary for the contractor to do the work. This statement of 
 the principle arbitrarily attaches to the contract a warranty which 
 
908 OPERATION OF CONTRACT (Ch. 4- 
 
 the parties did not put there, and places the owner in default when he 
 has been guilty of no wrong. Impossibility of performance because of 
 destruction of the building was not contemplated by either party. 
 Performance was prevented without fault of either party, and the true 
 rule is that neither party can be charged with delinquency because the 
 contract cannot be fulfilled. Annotation, L. R. A. 1916F^ 10, 52. ' 
 
 The contractor cannot give and the owner cannot obtain that which 
 they contracted about. Neither one can complain of the other on 
 that account, and the law must deal with the new situation of the 
 parties created by the fire. The owner cannot be called on to reimburse 
 the contractor merely because the contractor has been to expense in 
 taking steps tending to performance. A contractor may have pur- 
 chased special material to be used in repairing a house, and may have 
 had much millwork done upon it. If the material remain in the mill, 
 and the house burn, there can be no recovery. If the milled material 
 be .delivered at the house ready for use, and the house burn, there can 
 be no recovery. It takes ' sotnething more to make the owner liable 
 for what the contractor has done toward performance. The owner 
 must be benefited. He should not be enriched at the expense of the 
 contractor. That would be unjust, and to the extent that the owner 
 has been benefited, the law rhay properly consider him as resting under 
 a duty to pay. The benefit which the owner has received may or 
 may not be equivalent to the detriment which the contractor has suf- 
 fered. The only basis on which the law can raise an obligation on the 
 part of the owner is the consideration he has received by way of 
 benefit, advantage, or value to him. 
 
 The question whether or not the owner has been benefited frequently 
 presents difficulties. Sometimes the question is answered by the own- 
 er's own conduct, as when by taking possession, or by insuring as his 
 own property, or by other act, he evinces a purpose to appropriate the 
 contractor's material and labor. Sometimes the circumstances are such 
 that the owner is precluded from rejecting the fruits of the contrac- 
 tor's efforts if he would, as when one room is finished under a contract 
 to refloor two. In such cases it merely confuses the matter to bring in 
 the terms "acceptance," "assent," and similar expressions indicative of 
 the owner's attitude. If he should pay, it is not because assent or ac- 
 ceptance of benefit is "implied," or because he is "regarded as ac- 
 cepting benefit," but because of the fact that he has been benefited. 
 
 The test of benefit received has been variously stated.. Sometimes 
 it is said that benefit accrues whenever the contractor's material and 
 labor, furnished and performed according to the contract, have become 
 attached to the owner's realty. The facts of particular cases suggest 
 different forms of expression. After considering all the authorities 
 cited in the briefs, the court is inclined to approve, for the purposes of 
 this case, the form adopted by the Supreme Court of Massachusetts, in 
 the case of Young v. Chicopee, 186 Mass. 518, 72 N. E. 63, cited by the 
 plaintiff.- The action was one for labor and material furnished to 
 
Sec. 6) iMPOssiBiLiTr 909 
 
 repair a bridge destroyed by fire w'hile the work was proceeding. 
 The contract required at least half of the material to be "upon the job" 
 before work conimenced. The contractor complied with this con- 
 dition, and distributed material "all along the bridge" and on the 
 river bank. A portion of the material thus distributed but not wrought 
 into the structure was destroyed by fire. Liability for work done upon 
 and material wrought into the structure was not disputed, but the con- 
 tractor sought tp make good his entire loss." The court said: ,"In 
 whatever way the principle may be stated, it would seem that the lia- 
 bility of the owner in a case like this should be measured by the 
 amount of the contract work done which, at the time of the destruction 
 of the structure, had becOme so far ideintified with it as that but for 
 the destruction it would have inured to him as contemplated by the 
 contract." 186 Mass. 520, 72, N! E. 64. 
 
 Applying the test stated to the facts of the present controversy, it 
 is clear that. the plaintiff should recover for the work done in cutting 
 the old floor away from the wall and in removing such part of the 
 old floor as was necessary. The warehouse was improved to that 
 extent by labor, the benefit of which had inured to the defendant when 
 the fire occurred. If the fire had not occurred, the undesirable floor 
 would have been out of the way, precisely as the contract contemplated. 
 Likewise, the contractor should recover .for the completed concrete 
 footings. ; 
 
 The contractor should not recover for material furnished or labor 
 performed in the construction of either column or floor forms. They 
 were temporary devices, employed to give f orni to the structure yhich 
 was to be produced. They were not themselves wrought into the ware- 
 house, were to be removed when the work was cqmpleted, and inured 
 to nobody's benefit btt that of the contractor. , 
 
 The contractor should not recover for either , upright , or floor rods, 
 or for the labor of putting them in place. While the rods were wired 
 together, they were not attached to the building and would not have 
 been wrought into the structure until the concrete was poured. If the 
 fire had not occurred, the contractor could have removed the rods 
 without dismembering or defacing the warehouse, and the defendant 
 could not have held the rods as amalgamated into the fabric of his 
 structure. 
 
 There should be no recovery for superintendence and use of tools, 
 except as regards that part of the work done which had become identi- 
 fied with the warehouse itself. Other items sued for should be al- 
 lowed or disallowed by application of the principle indicated. * * * 
 
 In this case nonperformance was not the, result of the contractor's 
 fault, and' ho damages can be deducted on that account. 
 
 The defendant' says he had a right to a ' specific kind of completed 
 floor which he could; test and which would comply with a prescribed 
 test, and that cutting away the old floor from the walls of the building, 
 and concrete footings for a floor which was never laid, were of no 
 
910 OPERATION OF CONTRACT (Ch. 4 
 
 value to him. The test is whether or not the work would have inured 
 to his benefit as contemplated by, tihe contract if the fire had not oc- 
 curred. The cutting away of the old floor was done according to the 
 contract, and the defendant had the benefit of that work as soon as 
 it was finished, i The evidence was that putting in the concrete footings 
 was the next step in the construction of the concirete floor. Those 
 footings would have inured to his benefit, in accordance with the con- 
 tract, if the fire had not occurred. They became a part of his ware- 
 house. Unless he could reject them for want of substantial compliance 
 with the contract so far as they were concerned, he was benefited by 
 them at the time of their incorporation into his structure. Test of a 
 completed concrete floor was one of the things rendered impossible 
 by the fire. * * * 
 
 The judgment of the district court is reversed, and the cause is re- 
 manded, with direction to take such additional evidence as may be 
 necessary and determine the rights of the parties according io the 
 views which have been expressed.*" 
 
 Johnston, C. J. (dissenting in part). I am of opinion that the up- 
 right rods set up and tied together were a part of the building,. and a 
 recovery for them should be allowed. 
 
 KING V. BRAINE. 
 (Michaelmas Term, 1597. Owen, 60.) 
 
 A man sells sheep, and warrants that they are sound, and that they 
 shall be sound for the space of a year, upon which warrant an action 
 of the case was brought, and it was moved that the action did 
 not lye, because the warranty is impossible to be performed by the 
 party, because it is onely the act of God to make them sound for 
 
 40 Coronation Oases, and Similar Ones. — Even though, the speciflc acts prom- 
 ised are all easily possible of performance, if unforeseen events have made 
 impossible of attainment the obvious purpose for which the contract was 
 made, the contract is discharged as to all unmatured rights and duties. Krell 
 V. Henry, [1903] 2 K. B. 740 ; Chandler v. Webster, [1904] 1 K. B. 493, rooms 
 hired from which to view the coronation pageant of Edward VII, the king's 
 illness postponing the pageant ; Alfred Marks Realty Go. v. Hotel Hermitage 
 Co., 170 App. Div. 484, 156 N. X. Supp. 179 (1915), contract for advertising in 
 a yacht race program, and race called off because of war. 
 
 Cf. Heme Bay S. B. Co. v. Hutton, [1903] 2 K. B. 740, 755; London, etc., 
 Co. V. Schlesinger, [1916] 1 K. B. 20, enemy alien still bound to pay rent, 
 even though interned elsewhere; Burgett v. Loeb, 43 Ind. App. 657, 88 N. 
 E. 346 (1909), rent still due, even though tenant is later denied his license to 
 sell liquor. But see Stratford, Inc., v. Seattle Brewing & Malting Co., 94 
 Wash. 125, 162 Pac. 31, L. R. A. 1917C, 931 (1916), where a lease for saloon 
 purposes was held discharged by the enaction of a prohibition law. 
 
 The English cases are in conflict with Carroll v. Bowersock, supra, with 
 respect to quasi contractual rights in case of impossibility arising after part 
 performance. The general rule in America is that applied in Carroll v. Bower- 
 sock. See Thurston's Cases on Quasi Contracts, pp. 246-267; Woodward on 
 Quasi Contracts, chapter VII. 
 
Sec. '6) IMPOSSIBILITY 911 
 
 a year. But Clench and Fenner on the contrary ; for It Is not Impos- 
 sible, no more than if I warrant that such a ship shall return safe 
 to Bruges, and it is the usuall course between merchants to warrant 
 the safe return of their ships. 
 
 HOKANSON V. WESTERN EMPIRE LAND CO. 
 
 (Supreme Court of Minnesota, 1916. 132 Minn. 74, 155 N. W. 1043.) 
 
 Action by Herman Hokanson against the Western Empire Land 
 Company. From an order sustaining demurrer to the complaint, 
 plaintiff appeals. Reversed. 
 
 Holt, J.*^ The action relates to a written contract, executed by the 
 parties hereto, by the terms of which defendant, as the party of the 
 first part, agreed to sell ten acres of land in the state of Washington, 
 and plaintiff, as party of the second part, agreed to buy the same and 
 pay $5,000 therefor,, $1,300 of which was paid when the contract was 
 signed, and $740 was to be paid on or before June 27, 1913, and 
 the same amount on the 27th of each succeeding June until all was 
 paid. The land was planted to fruit trees. The contract is replete 
 with provisions requiring punctual and strict performance by the pur- 
 chaser of his part of the agreement, but these need not be particularly 
 referred to. In ' the contract is found this provision, which fur- 
 nishes the basis for the action : "The agreement to resell this land ac- 
 cording to attached agreement is hereby made a part of this contract, 
 and, if second party gives due notice of his desire to sell, as per agree- 
 ment, first party will extend the deferred payments on this contract 
 until such sale is made." 
 
 Attached to the contract is the agreement referred to, being in the 
 form of a letter signed by defendant and addressed to plaintiff, the 
 part bearing on this controversy reading as follows: "If you decide 
 that you wish to sell this land during the spring of 1913, we agree to 
 sell same for you by June 1, 1913, at a net price $600 per acre, pro- 
 viding you notify us of your decision to sell by March 1, 1913. It is 
 further agreed that, if you should decide to sell this land during the 
 season of 1914, we will sell it for you by June 1, 1914, at a net price 
 of $650 per acre, providing you notify us of your desire to sell by 
 March 1, 1914. In making such sale for you, it is agreed and under- 
 stood that we shall receive all amounts for which the land may be sold 
 over and above the within-mentioned net prices, as our commission 
 for making the sale. This is with the understanding that you will see 
 that the orchard is well cared for and the value not affected by any 
 neglect in the care of the tract during the year 1913." 
 
 The complaint, after stating the foregoing, setting out the contract 
 
 *^ Part of the opinion, is omitted. 
 
912 OPERATION OF CONTRACT (Ch. 4 
 
 in hsec verba, ■ alleged that prior to March 1, ,19J;3, plaintiff decided 
 that he desired to sell the, land during the spring of 1913, and that by 
 and beiore March 1, 1913, he duly notified the defendant of this deci- 
 sion to sell, and has always since been ready, willing, and able to sell 
 and convey all his interest in said land upon a sale thereof by defend- 
 ant, but that defendant has wholly failed to sell. Further allegations 
 are made of performance by plaintiff of all the terms to be by him 
 performed, and that prior to the commencement of the action he re- 
 linquished possession of the land. The action is said to have been be- 
 gun in 191 S, but the record does not show the date. The court sus- 
 tained a demurrer to the complaint; and plaintiff appeals. 
 
 The inducement and part consideration for plaintiff's entering the 
 contract to purchase the land was, no doubt, the undertaking by de- 
 fendant to resell the same for the price and by the time stated in the 
 letter attached to and made a part of the agreerrient. The argument 
 is made that, since defendant's ability to sell the land by a certain 
 time and for a specified price depended on the willingness to buy of 
 a .third party over whom it had no control, therefore the contract should 
 be held impossible of performance and invalid. We do not think such 
 to be the law. ' There is nothing in the undertaking inherently impos- 
 sible. Purchasers are found daily for lands at varying prices. There 
 is nothing so unreasonable either in the price fixed or the limit of time 
 within which to make the sale that performance may be said to have 
 been considered, by the parties, beyond the possibility of attainment, 
 when the contract was made. A contract which appears possible of 
 performance when made does not become invalid or unenforceable 
 because conditions afterwards arise which render performance, im- 
 possible. If there had been a speedy rise in the market value of this 
 land so that it would have been worth $1,000 per acre by March 1, 
 1913, would there have been any difficulty for defendant to have sold 
 it for $600 or $650 per acre? To make a contract invalid or unen- 
 forceable the thing agreed to be done must be impossible on its face, 
 not merely 'improbable or impossible to the promisor. , Cowley v. Da- 
 vidson, 13 Minn. 92 (Gil. 8.6) ; Stees v. Leonard, 20 Minn. 494 (Gil. 
 448) ; Anderson v: M,ky, 50 Minn. 280, 52 N. W. 530, 17 L. R. A. 555, 
 36 Am. St. Rep. 642. The inability to control the actions of a third 
 party whose co-operation is needed for a performance of the under- 
 taking, is not considered a legal impossibility avoiding the obliga- 
 tion. To this proposition the following authorities: m.ay be cited: 3 
 ElHot on Contracts, § 1916; Stone v. Dennis^ 3' Port. (Ala.) 231; 
 Wareham Bank v; Burt, 5 Allen (87 Mass.) 113; Van Etten v. New- 
 ton, 6 N. Y. Supp. 531, 7 N. Y. Supp. 663, 8 N. Y. Supp. 478; Beebe 
 V. Johnson, 19 Wend. (N. Y.) 500, 32 Am. Dec. 518: Gravel Switch 
 Tel. Co. V. Lebanon Tel. Co., 139 Ky. 151, 129 S. W. 559; The Harri- 
 man, 9 Wall. (U. S.) 161, 19 L. Ed. 629; Reid v. Alaska Packing Co., 
 43 Or. 429, 73 Pac. 337 ; and Watson v. Blossom, 4 N. Y. Supp. 489. 
 Failure to resell, according to the contract, constitutes a breach there- 
 
Sec. 6) IMPOSSIBILITY 91 ;i 
 
 of entitling plaintiff to damages. These are fixed by the terms of the 
 contract, and do not give rise to any difficulty. * * * 
 Order reversed,*^ 
 
 SUPERINTENDENT & TRUSTEES OF PUBEIC SCPIOOES OF 
 :CITY OF TRENTON v. BENNETT et al. ,\ 
 
 (Supreme Court of New Jersey, 1859. 27 N. J. Law, 513, 72 Am. Dec. 373.) 
 
 .WhElplEy, J,*^ This case presents the naked question whether, 
 where a builder has agreed, by a contract under seal, with the owner 
 of a lot of land, "to build, erect, and complete a building upon the lot 
 for a certain entire price, but payable in, arbitrary installments, fixed 
 without regard to the value of the work done, and the house before 
 its completion falls down, solely by reason, of a latent defect in the soil, 
 and not on account of faulty construction, the loss falls upon the 
 builder or the owner of the land." 
 
 The case comes before the court, upon a certificate from the Mer- 
 cer circuit, for the advisory opinion of this court. 
 
 The covenant of Evernham and Hill was to build, erect, and com- 
 plete the school-house upon the lot in question for the sum of $2610; 
 the whole price was to, be paid for the whole building; the division of 
 that sum into installments, payable at certain stages of the work, 
 was not intended to sever the entirety of the contract, and make the 
 payment of the installments payments for such parts of the work as 
 might be done when they were payable : this division was made, not 
 to apportion the price to the different parts of the work, but to suit 
 the wants of the contractor, and aid him in the completion of the 
 work ; the consideration of the covenant to complete the building was 
 the whole price, and not the mere balance that might remain after the 
 payment of the installments : it cannot be pretended that the contrac- 
 tor, after payment of a part of the installments, might refuse to go on 
 and complete the building, and yet retain that part of the price he 
 had received. Haslack v. Mayers, 26 JST. J. Law, 284. 
 
 No rule of law is more firmly established by a long train of deci- 
 sions than this, that where a party, by his own contract, creates a duty 
 or charge upon himself, he is bound to make it good if he may, not- 
 withstanding any accident by inevitable necessity, because he might 
 have provided against it by his contract ; therefore, if a lessee covenant 
 to repair a hpuse, though it be burned by lightning, or thrown down 
 by enemies, yet he is bound to repair it. Paradine v. Jane, Aleyn, 
 26; Walton v. Waterhouse, 2 W. Saund. 422a, note 2; Brecknock 
 Co. V. Pritchard, 6 Term R. 750. This case was an action upon a 
 
 ^2 In accord: Hurless v. Wiley, «1 Kan. 347, 137 Pac. 981, L. R. A. 19150. 
 177 (19143. See, also, Tode v. Gross, post, p. 1247. 
 *3 The statement of facts is omitted. 
 CoRT!I^' CoNT. — 58 
 
914 OPEEATION OP CONTRACT (Ch. 4 
 
 covenant to build a bridge, and keep it in repair: the defendant pleaded 
 that the .bridge was carried away by the act of God, by a great and 
 extraordinary flood, although well built and in good repair. The plea 
 was held bad on demurrer. 
 
 To the same effect are Bullock v. Dommit, 6 Term R. 650; Phil- 
 lips V. Stevens, 16 Mass. 238 ^ Dyer, 33a. And there is no relief 
 in equity. Gates v. Green, 4 Paige (N. Y.) 355, 27 Am. Dec. 68; 
 Holtzapffell v. Baker, 18 Ves. 115. Chancellor Walworth, in Gates 
 V. Green, in denying relief in equity against a covenant to pay rent 
 after the destruction of the demised premises, admits the rule to be 
 against natural law, and not to be found in the law of other coun- 
 tries where the civil law prevails ; yet says it is firmly established, not- ' 
 withstanding the struggles of some of the early English chancellors 
 against it. 
 
 In Beebe v. Johnson, 19 Wend. (N. Y.) 500, 32 Am. Dec. 518, it was 
 held by Nelson, C. J., delivering the opinion of the court, that the de- 
 fendant was not excused from performing his covenant to perfect, in 
 England, a patent granted in this country, so as to insure to the plain- 
 tiff the exclusive right of vending the patented article in the Canadas, 
 because the power of granting such an exclusive privilege appertained 
 not to the mother country, but to the provinces, and was never granted, 
 except to subjects of Great Britain and residents of the provinces; and 
 the plaintiff and defendant were both American citizens. 
 
 The court said, if the covenant be within the range of possibility, 
 however absurd or improbable the idea of execution may be, it will 
 be upheld, as where otie covenants it shall rain tomorrow, or that the 
 pope shall be at Westminster on a certain day. To bring the case with- 
 in the rule of dispensation, it must appear that the thing to be done 
 cannot by any means be accomplished; for if it be only improbable, 
 or out of the power of the obligor, it is not deemed in law impossible. 
 3 Comyn, Dig. 93. If a party enter into an absolute contract, without 
 any qualification of exception, and receives from the party with 
 whom he contracts the consideration of such engagement, he must 
 abide by the contract, and either do the act or pay the damages; his 
 liability arises from his own direct and positive undertaking. 
 
 In Lord V. Wheeler, 1 Gray (Mass.) 282, where a workman had 
 agreed to repair a building for an entire sum, and after the owner 
 had moved in, it was burned up before the repairs were completed, it 
 was held that where one person agrees to expend labor upon a spe- 
 cific subject, the property of another, as to shoe his horse, or slate his 
 dwelling-house, if the horse dies, or the dwelling-house is destroyed by 
 fire, before the work is done, the performance of the contract be- 
 comes impossible, and with the principal perishes the incident. The 
 case was clearly distinguished from the ordinary contract of one to 
 erect a building upon the lands of another, performing the labor and 
 supplying the materials therefor ; where, if before the building is com- 
 
Sec. 6) IMPOSSIBILITY 915 
 
 pleted or accepted, it is destroyed by fire or other casualty, the loss 
 falls upon the builder, he must rebuild. The thing may be done, and 
 he has contracted to do it. Adams v. Nichols, 19 Pick. (Mass.) 275, 
 31 Am. Dec. 137; Brumby v. Smith, 3 Ala. 123; 2 Pars. Cont. 184; 1 
 Chit. Cont. 568. 
 
 No matter how harsh and apparently unjust in its operation the 
 rule may occasionally be, it cannot be denied tiiat it has its foundations 
 in good sense and inflexible honesty. He that agrees to do an act 
 should do it, unless absolutely impossible., ,He should provide against 
 contingencies in his contract. Where one of two innocent persons 
 must sustain a loss, the law casts it upon him who has agreed to sus- 
 tain it, or rather the law leaves it where the agreement of the parties 
 has put it; the law will not insert, for the benefit of one of the par- 
 ties, by construction, an exception which the parties have not, either by 
 design or neglect, inserted in their engagement. If a party, for a suf- 
 ficient consideration, agrees to erect and complete a building upon a 
 particular spot, and find all ■ the materials, and do all the labor, he 
 must erect and complete it, because he has agreed so to do. No mat- 
 ter what the expense, he must provide such a substruction as will sus- 
 tain the building upon that spot, until it is complete and delivered to 
 the owner. If he agrees to erect a house upon a spot where it cannot 
 be done without driving piles, he must drive themy because he has 
 agreed to do everything necessary to erect and complete the building. 
 If the difficulties are apparent on the surface, he must overcome them. 
 If they are not, but become apparent by excavation or the sinking of 
 the building, the rule is the game. He must overcome them, and erect 
 the building, simply because he has agreed to do so — ^to do everything 
 necessary for that purpose. 
 
 The cases make no distinction between accidents that could be fore- 
 seen when the contract was entered into, and those that could not have 
 been foreseen. Between accidents by the fault of the contractor, and 
 those where he is without fault, they all rest upon the simple principle — 
 such is the agreement, clear and unqualified, and it must be performed, 
 no matter what the cost, if performance be not absolutely impossible. 
 
 The case of a bailment of an article — locatio operis faciendi — is not 
 analogous to the case' before the court ; there, if the article intrusted to 
 the workman is lost without his fault, the owner sustains the loss ; not 
 because he is the owner, but because the contract of bailment is well 
 defined by the law ; there is no express agreement to return the article 
 to the owner in a finished state ; but the agreement is an implied agree- 
 ment, a duty imposed by the law upon a bailee, because the chattel 
 has been bailed to him,, to use his best endeavors to protect the bail- 
 ment from injury. Parsons states the obligation of the workman to 
 be, to do the work in a proper manner, to employ the materials fur- 
 nished in the right way. These obligations grow out of the act of 
 bailment; they are its legal consequences, and the law declares them 
 
916 OPERATION OF CONTRACT (Ch. 4 
 
 to be so, not because the parties have actually so stipulated, but be- 
 cause they are equitable and fair ; and in the absence of express agree- 
 ment such will be impHed. 
 
 The case of Menetone v. Athawes, 3 Burrow, 1592, was relied up- 
 on by defendants' counsel to show that when the failure to perform 
 the contract was not the fault of the contractor, he can recover. It 
 was the bailment of a ship, to be repaired while in the shipwrights' 
 dock, for the use of which the owner paid £5. The vessel was burned 
 when the repairs were nearly completed; the action was for these re- 
 pairs. It was like the case of Lord v. Wheeler, before cited. The 
 right to recover was put upon the ground that the plaintiff was not 
 answerable for the accident, which* happened without his default, un- 
 less there ihad been a special undertaking; that 'this liability did not 
 grow out of the law of bailments. : 
 
 The cases of Trippe v. Armitage, 4Mees. & W. 689; Woods v. Rus- 
 sell, 5 Barn. & Aid. 942 ; Clarks v. Spence, 4 Adol. & E. 448,— have 
 no application ; they are all cases arising under the bankrupt laws, 
 involving the question when, under the circumstances of each case, 
 the property in an incomplete chattel in- process of manufacture passed 
 out of the bankrupt; so as not to belong to his assignees. They are 
 inapplicable, because the rights of the parties to this suit do not turn 
 upon the question whether the property in aji incomplete building is 
 in the owner of the land or the builder, or whether the owner would 
 derive a partial benefit from partial performance, but upon what was 
 the express contract between the parties. The question upon whbm- 
 the loss is to fall, occasioned by an inevitable accident; is not to be 
 settled by determining what is equitable, what is right, or by the ap- 
 plication of the maxim, res perit domino, or by any nice philosophical 
 disquisitions whether the owner or the builder shall bear the loss. 
 These considerations — this maxim — have their full application in cases 
 where the rights of the parties have not been fixed by contract, but 
 are to be settled by the law upori facts of the case ; where resort is to 
 be had to an implied contract, to a legal obligation raised by the law 
 out of the natural equities of the case, in the absence of ari express 
 agreement. 
 
 Neither the destruction of the incomplete building by a sudden tor- 
 nado, nor its falling by reason of a latent softness of the soil which ren- 
 dered the foundation insecure, necessarily prevented the performance 
 of the contract to build, erect, and complete the biiilding for the spec- 
 ified price; it can still be done, for aught that was opened to the jury 
 as a defense, and overruled by the coUrt. ■ 
 
 The whole defense was properly overruled, because it'did not show 
 the performance of the covenant impossible, or any lawful excuse for 
 non-performance of the contract. 
 
 I am also of opinion that the damage occasioned by the destruction 
 
Sec. 6) IMPOSSIBILITY 917 
 
 of the building by the gale of wind must be borne by the defendants, 
 for the reasons before given, and that the circuit court be advised ac- 
 cordingly.** 
 
 WHITMAN V. ANGLUM. 
 (Supreme Court of Errors of Connecticut, 1918. 92 Conn. 392. 103 Atl. 114.) 
 
 Action by Benjamin Whitman against Jerry P. Anglum. Judgment 
 for plaintiff, and defendant appeals. No error. 
 
 On the 5th day of March, 1914, the plaintiff and defendant entered 
 into a contract in writing whereby the plaintiff agreed to purchase, 
 and the defendant agreed \q sell, at least 175 quarts of milk each day 
 from April 1, 1914, to April 1, 1915. The contract contained the 
 following : "The said Whitinan is to come and get the milk at No. 1 
 Wawarme avenue, in the city of Hartford." 
 
 The premises of the defendant are known as No. 1 Wawarme ave- 
 nue. On the 23d day of November, 1914, by an order of the com- 
 missioner of domestic animals for the state, all the defendant's cattle 
 and products of his farm were quarantined. The defendant was quar- 
 
 ** Increased and unexpected difficulty or expense was held to be no excuse 
 in the following cases: Dermott v. Jones, 2 Wall. 1, 17 L. Ed. 762 (1864) ; 
 Stees V. Leonard, 20 Minn. 494, Gil. 448 (1874), quicksand encountered; 
 Porto Rico Sugar Co. v. Lorenzo, 222 U. S. 481, 32 Sup. Ct. 133, 56 L. Ed. 277 
 (1912), broken machinery; Motschman v. U. S., 47 Ct. CI. 373 (1912); 
 Carnegie Steel Co. v. U. S., 240 U. S. 156, 36 Sup. Ct. 342, 60 L. Ed. 576 
 (1915), performance required the discovery of a new process, which was 
 in fact discovered , too late to perform on time ; Harley v. Saiiltary Dist. of 
 Chicago, 226 111. 213, 80 N. E. 771 (1907), frozen ground; Ptacek v. Pisa, 231 
 111. 522, 83 N. E. 221, 14 L. R. A. (N. S.) 537 (1907) ; Carlson v. Sheehan, 157 
 Cal. 692, 109 Pac. 29 (1910), landslide; John Cowan, Inc., v. Meyer, 125 Md. 
 450, 95 Atl. 18 (1915), roelc encountered in excavating; Carter v. Root, 84 
 Neb. 723, 121 N. W. 952 (1909). rains; Transparent Rubber Works v. In- 
 ternational Glass Co., 92 N. J. Law, 461, 105 Atl. 299 (1918), lack of manu- 
 facturing facilities; Corona Coal & Coke Co. v. Dickinson, 261 Pa. 589, 104 
 Atl. 741 (1918), coal vein became thinner and more difficult to work; Kings- 
 ville Cotton Oil Co. v. Dallas Waste Mills (Tex. Civ. App.) 210 S. W. 832 (1919) , 
 failure of a power company to supply power used in manufacturing ; Marx v. 
 Kilby Locomotive & Machine Works, 162 Ala. 295, 50 South. 136, 136 Am. St. 
 Rep. 24 (1909) ; Brown v. Ehlinger, 90 Wash. 585, 156 Pac. 544 (1916), in- 
 junction prevented use of rock crusher at the place expected. 
 
 Where a contractor agrees to construct according to certain plans and 
 specifications, he is not excused merely because the plans turn out to be un- 
 suitable or difficult. • Magnan Co. v. Fuller, 222 Mass. 530, 111 N. E. 399 
 (1916) ; Rowe v. Inhabitants of Peabody, 207 Mass. 226, 93 N. E. 604 (1911) ; 
 Cameron-Hawn Realty Co. v. City of Albany, 207 N. T. 377, 101 N. E. 162, 
 49 L. R. A. (N. S.) 922 (1913). Cf. Pine Bluff Hotel Co. v. Monk, & Ritchie, 
 122 Ark. 308, 183 S. W. 761 (1916). 
 
 , Sickness is no excuse, the performance not being personal. West Chicago 
 Park Com'rs v. Carmody, 139 111. App. 635 (1908) ; Gem Knitting Mills v. 
 Empire Printing & Box Co., 3 Ga. App. 709, 60 S. E. 365 (1908). 
 
 Financial stringency or bankruptcy is no excuse. Board of Commerce of 
 Ann Arbor, Mich., v. Security Trust Co., 225 Fed. 454, 140 C. C. A. 486 (1915) ; 
 Ingham Lumber Co. v. IngersoU, 93 Ark. 447, 125 S. W. 139, 20 Ann. Cas. 
 1002 (1910) ; Pratt v. McCoy, 128 La. 570, 54 South. 1012 (1911). 
 
918 OPERATION OF CONTRACT (Ch. 4 
 
 antined, and he was not allowed to go from the premises. Shortly after 
 the quarantine order, all the cows on the farm were killed. The quar- 
 antine was intended as far as possible to prevent all persons and animals,. 
 from going on or off the premises, as well as to prevent the removal of 
 products of all kinds that might carry infection of the "hoof and 
 mouth disease" then prevalent among the defendant's cattle. From 
 November 22, 1914, the defendant failed to furnish or offer to furnish 
 milk until March 13, 1915. From a judgment in favor of the plain- 
 tiff, the defendant has appealed. 
 
 Shumway, J. (after stating the facts as above).' This was an abso- 
 lute and unconditional undertaking by the defendant to sell and deUver 
 milk daily of the specified quality and amount. The defendant's claim 
 is that he was excused from the performance of the contract by rea- 
 son of the quarantine, which made it illegal for him to leave his 
 premises and carry away any products of his farm or any articles that 
 might carry infection. The quarantine order did hot make it illfegal to 
 deliver milk, nor make it illegal for the defendant to procure its de- 
 livery. 
 
 This much is conceded. But the defendant contends' that the clause 
 in the contract, to wit, "The said Whitman is to come and get the inilk 
 at No. 1 Wawarme avenue," is an essential part of the contract, and, 
 as delivery was to be made at the place named, therefore delivery under 
 the terms of the contract was illegal. There is nothing in the record 
 to show that the defendant could not perform his contract. While it 
 may be true that the plaiiitiff could not enter the defendant's house or 
 go upon other parts of the premises which were under quarantine,^ it 
 does not follow that the contract could not be performed substantially 
 if not literally. The contract was not to deliver milk produced on the 
 premises. All that can be said is, the defendant was under a tempo- 
 rary disability to perform his contract. He is not, however, released 
 from the obligations of his contract because it was difficult or, impos- 
 sible to perform them, so long as the performance was not illegal. 
 School District v. Dauchy, 25 Conn. 530, 68 Am. Dec. 371 ; Worthing- 
 ton V. Charter Oak Life Insurance Company, 41 Conn. 401, 19 Am. 
 Rep. 495. 
 
 There is no error. The other Judges concurred. 
 
 THE RICHLAND QUEEN. 
 RICHLAND S. S. CO. v. BUFFALO DRY DOCK CO. 
 
 (Circuit Court of Appeals of the United States, 1918. 254 Fed. 668, 166 C. 
 
 O. A. 166.) 
 
 Libel by the Buffalo Dry Dock Company against the steamship Rich- 
 land Queen, her engines, etc., claimed by the Richland Steamship Com- 
 pany, together with a Ubel by the Richland Steamship Company against 
 
Sec. 6) IMPOSSIBILITY 919 
 
 the Buffalo Dry Dock Company. From decrees for the Dry Dock 
 Company, the Steamship Company appeals. Affirmed. 
 
 Ward, Circuit Judge. This is an appeal from a decree of Judge 
 Hazel in favor of the Buffalo Dry Dock Company for the reasonable 
 cost of repairs to the steamer Richland Queen, and dismissing the 
 cross-libel of the Richland Steamship Company for damages for loss 
 of the i^se of the vessel due to unreasonable delay in making the repairs. 
 
 September 5, 1916, the steamer was sent to the Dry Dock Company's 
 yard, and remained there until December 5th. No express contract for 
 the repairs was made, but the reasonable value of the use of the dry 
 dock and of the repairs is admitted to have been $39,984.08. The 
 Steamship Company, in order to get possession of its vessel, paid 
 $30,000 to the Dry Dock Company without prejudice, and gave a stip- 
 ulation for the balance, and in its cross-libel alleged that the repairs 
 should have been completed by October 9, 1916, and that it was de- 
 prived of the use of its steamer during the remainder of the season to 
 November 13th, or 37 days, at the reasonable rate of $500 a day, ag- 
 gregating $18,500. 
 
 The Dry Dock Company kept an open shop, and justified the delay 
 by the fact that a strike of its workmen began October 14, 1916, with- 
 out grievance or warning, which prevented by intimidation and vio- 
 lence old hands and new hands from working. 
 
 At the trial the only contention was as to the damages for delay, 
 viz. whether the Steamship Company was entitled to a decree for $18,- 
 500, less the unpaid balance of the Dry Dock Company's bill of $9,- 
 984.08. 
 
 The working day in the Buffalo shipyards at the time in question was 
 nine hours, with a half holiday on Saturday during the summer months, 
 while some competing yards on the Lakes required a nine-hour, and 
 some a ten-hour, day. 
 
 October 14, 1916, a committee of workmen dei;nanded of the Dry 
 Dock Company an eight-hour day without reduction of pay, which 
 the company refused, and notified the men that thereafter they must 
 work a straight nine-hour day for six days in the week. As a conse- 
 quence 80 to 90 per cent, of the men left the yard, and although the 
 company did its best to secure an adequate force of workmen, it was 
 not able to do so. The strike involved no violence, although picketing 
 was kept upi in the neighborhood of the yard, and there was much 
 persuasion of both old and new hands. The men gradually came back 
 between November 15th and December 2d, without any change in the 
 hours of labor, and there has been no labor trouble since that time. 
 
 Judge Hazel was of opinion that the Dry Dock Company, in view 
 of all the circumstances, made the repairs to the steamer in a rea- 
 sonable time, and was not liable under the decision' of the Court of 
 Appeals of the state of New York in D., L. & W. R. R. Co. v. Bowns, 
 58 N. Y. 573. In that case, however, there was an agreement to deliver 
 
920 OPERATION OF CONTRACT (Ch. 4 
 
 coal within a fixed time, with an express exception of interference by 
 strikes. No time was fixed in the case under consideration for making 
 the repairs, so that the obligation of the Dry Dock Company ■ was to 
 make them within a reasonable time, and there was no exception of 
 strikes. :The question, therefore, is simply whether the delay com- 
 plained of was reasonable or unreasonable, not in view of the circum- 
 stances existing at the time the contract was made, but in view of the 
 circumstances existing when the contract was being performed. Em- 
 pire Transportation Co. v. P. & R. R. R. Co., 17 Fed. 919, 23 C. C. A. 
 564, 35 t. R. A. 623 ; Hick v. Rodoconachi, 2 Q. B. D. 626. 
 
 The Court of Appeals of the state of New York has held that a 
 peaceable strike of the employer's servants is no defense to a claim 
 for delay (Blackstock v'. New York & Erie R. R. Co., 20 N. Y. 48, 
 75 Am. Dec. 372), while a strike with violence is a defense (Geismer 
 V. Lake Shpre & M. S. Ry. Co., 102 N. Y. 563, 7 N. E. 828, 55 Am. 
 Rep. 837. The employfer in each of these cases was a common car- 
 rier, but, as the recovery sought was for damages caused by delay in 
 delivery, the decisions are applicable to the situation under considerT 
 ation, because common carriers are not insurers of prompt delivery, 
 but only liable for ordinary care and diligence. The duty is the same 
 as in the present case, viz. the performance in a reasonable time in 
 view of all the circumstances. 
 
 We do not appreciate the distinction made in these cases, thinking 
 that the difference between a peaceable and a violent strike as a de- 
 fense is one of degree only, a strike with violence being more likely to 
 be a good defense than a peaceable strike. The question, however, in 
 each case is the same, whether the conduct of the employer was rea- 
 sonable. A peaceable strike upon frivolous grounds, which the em- 
 ployer did all he could to prevent, "should be a defense against a claim 
 for delay. On the other hand, a violent strike on justifiable grounds, 
 which the employer either fomented or unreasonably resisted, ought 
 to be no defense. Of course, the employer in either case could end the 
 strike by surrendering. We are not disposed to differ with Judge 
 Hazel's finding that the Dry Dock Company's performance was rea- 
 sonable in view of the strike. ^ 
 
 Decree affirmed.*^ 
 
 *" See, also, Empire Trans. Co. v. Philadelphia & R. Coal & Iron Co., 77 Fed. 
 019, 23 C. C. A. 564, 35 L. R. A. 623 (1896) ; Geismer v. Lake Shore & M.' 
 S. R. Co.,a02 N. Y. 563, 7 N. E. 828, 55 Am. Rep. 837 (1886) ; Pittsburg, 0. & 
 St. L. R. Co. V. Hollowell, 65 Ind. 188, 32 Am. Rep. 63 (1879) ; Hultlien v. 
 Stewart, [1903] A. C. 389. Where the defendant contracted to complets the 
 work by a specific date, he is not ordinarily excused in case of delay caused by 
 a strike. Budgett v. Binnington, [1891] 1 Q. B. 35 ; Barry v. U. S., 229 U. S. 
 47, 33 Sup. Ct. 681, 57 L. Ed. 1060 (1913) ; Morse Dry Dock & Repair Co. 
 T. Seaboard Trans. Co., 161 Fed. 99, 88 C. C. A. 263 (1908) ; Koski v. Finder, 
 176 111. App. 284 (1913). . 
 
 Contracts frequently provide that the contractor shall be excused by events 
 such as fire, accident, strikes, war, and "other causes beyond the control" 
 of the contractor. This provision is given a reasonable application, and the 
 
Sec. 6) IMPOSSIBILITY 921 
 
 Manton, Circuit Judge (dissenting).*" * * * And what is a 
 reasonable time must be determined by what the parties had in mind 
 when the contract was made, and this must be judged by the circum- 
 stances which surrounded the parties at the time the contract was made, 
 rather than by the circumstances and conditions which subsequently 
 arose, and in this connection knowledge which the appellee had as to its 
 unsettled condition of labor, or the prospect of a strike, could not be 
 locked up in the mind of the appellee, and should have been disclosed to 
 the owners of the vessel ; for it is true that the owner of the vessel, with- 
 out knowledge, could reasonably have in mind that the work would be 
 done within a reasonable time, such as normal conditions in the yard 
 would permit. It was within the power of the appellee to disclose such 
 information, and, indeed, to make it one of the conditions of accepting 
 the work. Even where labor trouble is not anticipated, such provisions 
 are frequently put in contracts. D., L,. & W. v. Bowns, 58 N. Y. 
 573. * * * 
 
 Hardship, expense, or loss to the party performing his contract, or 
 anything short of impossibility of performance, will not excuse a 
 breach of the contract. In my opinion there has been a breach here to 
 the damage of the libelant, and it should have a decree on the cross- 
 libel. 
 
 MINERAL PARK LAND CO. v. HOWARD et al. 
 
 (Supreme Court of California, 1916. 172 Oal. 289, 156 Pac. 458, L. R. A. 
 
 1916F,.,1.) 
 
 Action by the Mineral Park Land Company against P. A. and C. 
 H. H^oward. Judgment for plaintiff, and defendants appeal. Modi- 
 fied and affirmed. 
 
 Sloss, J. The defendants appeal from a judgment in favor of plain- 
 tiff for $3,650. The appeal is on the judgment roll alone. 
 
 The plaintiff was the owner of certain land in the ravine or wash 
 known as the Arroyo Seco, in South Pasadena, Los Angeles county. 
 The defendants had made a contract with the public authorities for the 
 construction of a concrete bridge across the Arroyo Seco. In August, 
 1911, the parties to this action entered into a written agreement where- 
 by the plaintifif granted to the defendants the right to haul gravel and 
 
 promisor is more likely to be excused. See Davison Chemical Co. of Balti- 
 more County V. Baugh Chemical Co. of Baltimore Opunty,, 133 Md. 203, 104 
 Ml. 404, 3 A. L. R. 1, with note, page 21 (1918)^ Moore & Tiemey v. 
 Roxford Knitting Co. (D. O.) 250 Fed. 278 (1918) ; Standard Silk Dyeing 
 Co. V. Roessler & Hasslacher Chemical Co. (D. C.) 244 Fed. 250 (1017) ; 
 Metropolitan Water Board v. Dick, [1918] A. 0. 119; Wilson & Co. 
 V. Tennants, [1917] A. C. 495; Peter Dixon & Sons v. Henderson, [1919J 
 2 K. B. 778; Ducas Co. v. Bayer Co. (Sup.) 163 N. Y. Supp. 32 (1916) ; Sum- 
 mers V. Hibbard, Spencer, Bartlett & Co., 153 111. 102, 38 N. E. 899, 46 Am. 
 St. Rep. 872 (1894). 
 
 *° Only a small part of the dissenting opinion is here printed. 
 
922 OPERATION OF CONTEACT (Ch. 4 
 
 earth from plaintiff's land, the defendants agreeing to take therefrom 
 all of the gravel and earth necessary in the construction of the fill and 
 ^ cement work on the proposed bridge, the required amount being esti- 
 
 mated at approximately 114,000 cubic yards. Defendants agreed to 
 pay 5 cents per cubic yard for the first 80,000 yards, the next 10,000 
 yards were to be given free of charge, and the balance was to be paid 
 for at the rate of 5 cents per cubic yard. 
 
 The complaint was in two counts. The first alleged that the de- 
 fendants had taken 50,131 cubic yards of earth and gravel, thereby 
 becoming indebted to plaintiff in the sum of $2,506.55, of which only 
 $900 had been paid, leaving a balance of $1,606.55 due. The findings 
 support plaintiff's claim in this regard, and there is no question of the 
 propriety of so much of the judgment as responds to the first count. 
 The second count sought to recover damages for the defendants' fail- 
 ure to take from plaintiff's land any more than the 50,131 yards. 
 
 It alleged that the total amount of earth and gravel used by defend- 
 ants was 101,000 cubic yards, of which they procured 50,869 cubic 
 yards from some place other than plaintiff's premises. The amount 
 due the plaintiff for this amount of earth and gravel would, under the ' 
 terms of the contract, have been $2,043.45. The count charged that 
 plaintiff's land contained enough earth and gravel to enable the de- 
 fendants to take therefrom the entire amount required, and that the 
 50,869 yards not taken had no value to the plaintiff. Accordingly the 
 plaintiff sought, under this head, to recover damages in the sum of 
 $2,043.45. 
 
 The answer denied that the plaintiff's land contained any amount of 
 earth and gravel in excess of the 50,131 cubic yards actually taken, 
 and alleged that the defendants took from the said land all of the earth 
 and gravel available for the work mentioned in the contract. 
 
 The court found that the plaintiff's land contained earth and gravel 
 far in excess of 101,000 cubic yards of earth and gravel, but that only 
 50,131 cubic yards, the amount actually taken by the defendants, was 
 above the water level. No greater quantity could have been taken "by 
 ordinary means," or except by the use, at great expense, of a steam 
 dredger, and the earth and gravel so taken could not have been used 
 without first having been dried at great expense and delay. On the 
 issue raised by the plea of defendants that they took all the earth and 
 gravel that was available the court qualified its findings in this way: 
 It found that the defendants did take all of the available earth and 
 gravel from plaintiff's premises, in this, that they took and removed 
 "all that could have been taken advantageously to defendants, or all 
 that was practical to take and remove from a financial standpoint"; 
 that any greater amount could have been' taken only at a prohibitive 
 cost, that is, at an expense of 10 or 12 times as much as the usual cost 
 per yard. It is also declared that the word "available" is used in the 
 findings to mean capable of being taken and used advantageously. It 
 was not "advantageous or practical" to have taken more material from 
 
Sec. 6) IMPOSSIBILITY 923 
 
 plaintiff's land, but it was not impossible. There is a finding that the 
 parties were not under any mutual misunderstanding regarding the 
 amount of available gravel, but that the contract was' entered into 
 without any calculation on the part of either of the parties with ref- 
 erence to the amount of available earth and gravel on the premises. 
 
 The single question is whether the facts thus found justified the de- 
 fendants in their failure to take from the plaintiff's land all of the 
 earth and gravel required. This question was answered in the nega- 
 tive by the court below. The case was apparently thought to be 
 governed by the principle — established by a multitude of authorities — 
 that where a party has agreed, without qualification, to perform an act 
 which is not in its nature impossible of performance, he is not excused 
 by difficulty of performance, or by the fact that he becomes unable to 
 perform. 1 Beach on Contracts, § 217; Klauber v. S. D. S. C. Co., 
 95 Cal. 353, 30 Pac. 555; Wilmington Trans. Co. v. O'Neil, 98 Cal. 1, 
 32 Pac. 705 ; The Harriman, 9 Wall. 172, 19 L. Ed. 629. 
 
 It is, however, equally well settled that, where performance depends 
 upon the existence of a given thing, and such existence was assumed 
 as the basis of the agreement, performance is excused to the extent 
 that the thing ceases to exist or turns out to be nonexistent. 1 Beach, 
 Contr. § 217; 9 Cyc. 631. Thus, where the defendants had agreed 
 to pasture not less than 3,000 cattle on plaintiff's land, paying therefor 
 $1 for each and every head so pastured, and it developed that the 
 land did not furnish feed for more than 717 head, the number actual- 
 ly put on the land by defendant, it was held that plaintiff could not 
 recover the stipulated sum for the difference between the cattle pas- 
 tured and the minimum of 3,000 agreed to be pastured. Williams v. 
 Miller, 68 Cal. 291, 9 Pac. 166. Similarly, in Brick Co. v. Pond, 38 
 Ohio St. 65, where the plaintiff had leased all the "good No. 1 fire clay 
 on his land," subject to the condition that the lessees should mine or 
 pay for not less than 2,000 tons of clay every year, paying therefor 
 25 cents per ton, the court held that the lessees were not bound to pay 
 for 2,000 tons per year, unless there was No. 1 clay on the land in 
 such quantities as would justify its being taken out. In Ridgely v. 
 Conewago Iron Co. (C. C.) 53 Fed. 988, the holding was that a min- 
 ing lease requiring the lessee to mine 4,000 tons of ore annually, and 
 to pay therefore a fixed sum per ton, or, failing to take out such quan- 
 tity, to pay therefor, imposed no obligation on the lessee to pay for 
 such stipulated quantity after the ore in the demised premises had be- 
 come exhausted. There are many other cases deahng with mining 
 leases of this character, and the general course of decision is to the 
 effect that the performance of the obligation to take out a given quan- 
 tity or to pay royalty thereon, if if be not taken out, is excused if it 
 appears that the land does not contain the stipulated quantity. Brooks 
 V. Cook, 135 Ala. 219, 34 South. 960; Muhlenberg v. Henning, 116 
 Pa. 138, 9 Atl. 144; McCahan v. Wharton, 121 Pa. 424, 15 Atl. 615; 
 Boyer v. Fulmer, 176 Pa. 282, 35 Atl. 235 ; Bannan y. Graeff, 186 Pa. 
 
924 OPERATION OF CONTRACT (Ch. 4 
 
 648, 40 Atl. 805; Gribben v. Atkinson, 64 Mich. 651, 31 N. W. 570; 
 Blake v. Lobb's Estate, 110 Mich. 608, 68 N. W. 427; Hewitt Iron 
 M. Co. V. Dessau Co., 129 Mich. 590, 89 N. W. 365 ; Diamond I. M. 
 Co. V. Buckeye I. M. Co., 70 Minn. 500, 73 N. W. 507. 
 
 We think the findings of fact make a case falling within the rule of 
 these decisions. The parties were contra:cting for the right to take 
 earth arid gravel to be used in the cotistruction of the bridge. When 
 the}' stipulated that all of the earth and gravel needed for this purpose 
 should be taken from plaintiff's land, they contemplated and assumed 
 that the land contained the requisite quantity, available for use. The 
 defendants were not binding themselves to take what was not there. 
 And, in determining whether the earth and gravel were "available," we 
 must view the conditions in a practical and reasonable way. Although 
 there was gravel on the land, it was so situated that the defendants 
 could not take it by ordinary means, nor except at a prohibitive cost. 
 To all fair intents then, it was impossible for defendants to take it. 
 
 "A thing is impossible in legal contemplation when it is not practica- 
 ble ; and a thing is impracticable when it can only be done at an ex- 
 cessive and unreasonable cost." 1 Beach on Contr. § 216. We do not 
 mean to intimate that the defendants could excuse themselves by 
 showing the existence of conditions which would make the perform- 
 ance of their obligation more expensive than they had anticipated, or 
 which would entail a loss upon them. But, where the difference in 
 cost is so great as here, and has the effect, as found, of making per- 
 formance impracticable, the situation is not different from that of a 
 total absence of earth, and gravel. 
 
 On the facts found, there should have been no recovery on the sec- 
 ond count. 
 
 The judgment is modified by deducting therefrom the sum of $2,- 
 043.45, and, as so modified, it stands affirmed.*^ 
 
 NORTH GERMAN LLOYD v. GUARANTY TRUST CO. 
 
 (Supreme Court of the United States, 1917. 244 U. S. 12, 37 Sup. Ct. 490, 
 
 61 L. Ed. 960.) 
 
 Mr. Justice Holmes delivered the opinion of the court : 
 This writ was granted to review two decrees that reversed decrees 
 of the district court, dismissing libels against the steamship Kron- 
 prinzessin Cecilie. 238 Fed. 668, 151 C. C. A. 518; 228 Fed. 946, 
 
 *' See critical note in L. R. A. 1916F, 1. In ClarksviUe Land Co. v. Harri- 
 man, 68 N. H. 374, 44 Atl. 527 (1895), tlie defendant's duty to float logs 
 down a stream was held discharged w^ien the water was rendered insufficient 
 by drouth. But in Berg v. Erickson, 234 Fed. 817, 148 C. C. A. 415, L. R. A. 
 1917A, 648 (1916), the defendant's duty to furnish pasturage was held not 
 discharged by a drouth that destroyed the grass, and in Northern Irr. Co. v. 
 Watldns (Tex. Civ. App.) 183 S. W. 431 (1916), a drouth was held no excuse 
 for failure to supply water for irrigation. Cf., also, Blackburn Bobbin Co. v. 
 Allfn, [1918] 2 K. B. 467, 119 L. T, 215, 3 A. L. R. 11. 
 
Sec. 6) IMPOSSIBILITY 925 
 
 965. The libels alleged breaches of contract by the steamship in 
 turning back from her voyage from New York and failing to trans- 
 port kegs of gold to their destinations. Plyniouth and Cherbourg, 
 on the eve of the outbreak of the present war. The question is 
 whether the turning back was justified by the facts that we shall 
 Stat?;. 
 
 The Kronprinzessin Cecilie was a German steamship owned by 
 the claimant, a German corporation. On July 27, 1914, she received 
 the gold in New York for the above destinations, giving bills of lad- 
 ing in American form, referring to the Parter Act, and we assume, 
 governed by our law in respect of the justification set up. Early 
 on July 28 she sailed for Bremerhaven, Germany, via the mentioned 
 ports, having on board 1,892 persons, of whom 667 were Germans, 
 passengers ajid crew; 406, Austrians; 151, Russians; 8, Bulgars; 
 7, Serbs; 1, Roumanian; 14, English; 7, French; 304, Americans; 
 and 2 or 3 from Italy, Belgium, Holland, etc. She continued on her 
 voyage until about 11:05 p. m. Greenwich time, July 31, when she 
 turned back; being then in 46° 46' N. latitude and 30° 21' W. longi- 
 tude from Greenwich, and distant from Plymouth about 1,070 nauti- 
 cal miles. At that moment the master knew that war had been de- 
 clared by Austria aga,inst Servia (July 28), that Germany had declined 
 a proposal by Sir Edward Grey for a conference, of Ambassadors in 
 London ; that orders had been issued for the German fleet to concen- 
 trate in home waters; that Britisji battle squadrons were ready for 
 service; that Germany had sent an ultimatum to Russia; and that 
 business was practically suspended on the London Stock Exchange. 
 He had proceeded about as far as he could with coal enough to return 
 if that should prove needful, and was of opinion that the proper course 
 was to turn back. He reached Bar Harbor, Maine, on August 4, 
 avoiding New York on account of supposed danger from British cruis- 
 ers, and returned the gold to the parties entitled to the same. 
 
 On July 31 the German Emperor declared a state of war, and the 
 directors of the company at Bremen, knowing that that had been or 
 
 .forthwith, wpuld be declared, sent a wireless to the master: "War has 
 broken out with Elngland, France, and Russia, Return to New York." 
 
 ' Ther€;upon: he turned back. The probability was that the steamship, 
 if not interfered with or prevented by accident or unfavorable weather, 
 would have reached Plymouth between 11 p. na. August 2, and 1 a. m. 
 August 3, and would have delivered the gold destined for England, 
 to be forwarded to London by 6 a. m., August 3. On August 1st, 
 at 9:40 p. m., before the earliest moment for probably reaching Ply- 
 mouth, had the voyage kept on, the master received a wireless mes- 
 sage from the German Imperial Marine Office : "Threatening danger 
 of war. Touch at no port, [of] England, France, Russia."- On the 
 same day Germany declared war on Russia. On August 2, Germany 
 
 .demanded, of Belgium passage for German troops, and seized two 
 English vessels with their cargoes. Explanations were offered for the 
 
926 OPERATION OF CONTRACT (Ch. 4 
 
 seizures, but the vessels were detained. The German Army entered 
 Luxembourg, and there were skirmishes with French troops. On 
 August 3, Germany was at war with France, and at 11 p. m., on Au- 
 gust 4, with England. On August 4 some German vessels were de- 
 tained by England, and early on the fifth were seized as prize, e. g., 
 The Prinz Adalbert, L. R. [1916] P. 81. ' No general history of the 
 times is necessary. It is enough to add that from the moment Austria 
 declared war on Servia the great danger of a general war was known 
 to all. 
 
 With regard to the principles upon which the obligations of the ves- 
 sel are to be determined it is plain that, although there was a bill of 
 lading in which the only exception to the agreement relied upon as 
 relevant was "arrest and restraint of princes, rulers, or people," other 
 exceptions necessarily are to be implied; at least, unless the phrase 
 "restraint of princes" be stretched beyond its literal intent. The 
 seeming absolute confinement to the words of an express contract 
 indicated by the older cases like Paradine v. Jane, Aleyn, 26, 82 Eng. 
 Reprint, 897, has been mitigated so far as to exclude from the risks 
 of contracts for conduct (other than the transfer of fungibles like 
 money), some, at least, which, if they had been dealt with, it cannot 
 be believed that the contractee would have demanded or the contractor 
 would have assumed. Baily v. De Crespigny, L. R. 4 Q.- B. 180, 
 185. Familiar examples are contracts fOr personal service, excused 
 by death, or contracts depending • upori the existence of a particular 
 thing. Taylor v. Caldwell, 3 Best & S. 826, 839. It has been held 
 that a laborer was excused by the prevalence of cholera in the place 
 where he had vmdertaken to work. Eakeman v. Pollard (1857) 43 
 Me. 463, 69 Am. Dec. 77.*'^ The same principles apply to contracts of 
 shipment. If it had been certain that the vessel would have "been 
 seized as prize upon reaching England, there can be no doubt that 
 it would have been warranted in turning back. See Mitsui & Co. v. 
 Watts, W. & Co. [1916] 2 K. B. 826, 845; The Styria v. Morgan, 
 186 U. S. 1, 22 Sup. Ct. 731, 46 L. Ed. 1027. The owner of a cargo 
 upon a foreign ship cannot expect the foreign mastei- to run greater 
 risks than he would in respect to goods of his own nation. The 
 Teutonia, L. R. 4 P. C. 171 ; The San Roman, E. R. 5 P. C. 301, 
 307. And when we add to the seizure of the vessel the possible deten- 
 tion of the German and some of the other passengers, the proposition is 
 doubly clear. Cases deciding what is and what is not within the risk of 
 an insurance policy throw little light upon the standard of conduct to 
 be applied in a case like this. But we see no ground to doubt that 
 Chief Justice Marshall and Chief Justice Kent would have concurred 
 in the views that we express. Oliver v. Maryland Ins. Co., 7 Cranch, 
 487, 493, 3 L. Ed. 414; Craig v. United Ins. Co., 6 Johns. (N. Y.) 
 
 *8Also Lawrence v. Twentlman, KoUe Abr. 450 (G) 10 (1611). Cf. Hall 
 V. Wright, El. Bl. & El. 746 (1858) ; Dew^y v. Alphena School Dist., 43 Mich. 
 480, 5 N. W. 646, 38 Am. Rep. 206 (1880). 
 
Sec. 6) IMPOSSIBILITY 927 
 
 226, 250, 253, 5 Am. Dec. 222. See also British & F. M. Ins. Co. v. 
 Sanday [1916] A. C. 650. 
 
 What we have said so far we hardly suppose to be denied. But if 
 it be true that the master was not bound to deliver the gold in England 
 at the cost of capture, it must follow that he was'entitled to take rea- 
 sonable precautions to avoid that result, and the question narrows 
 itself to whether the joint judgment of the master and the owners in 
 favor of return was wrong. It was the opinion very generally acted 
 upon by German shipowners. The order from the Imperial Marine 
 Office, if not a binding command, at least shows that if the master 
 had remained upon his course one day longer, and had received the 
 message, it would have been his duty as a prudent man to turn back.. 
 But if he had waited till then, there would have been a question 
 whether his coal would hold out. Moreover if he would have been 
 required to turn back before delivering, it hardly could change his 
 liability that he prophetically and rightly had anticipated the absolute 
 requirement by twenty-four hours. We are wholly unable to accept 
 the argument that although a shipowner mg-y give up his. voyage to 
 avoid capture after war is declared, he never is at liberty to anticipate 
 war. In this case the anticipation was correct, and the master is nof 
 to be put in the wrong by nice calculations that if all went well he might 
 have delivered the gold and escaped capture by the margin of a few 
 hours. In our opinion the event shows that he acted as a prudent man. 
 
 We agree with th^ counsel for the libellants that on July 27 neither 
 party to the contract thought that it would not be performed. It was 
 made in the usual form, and, as we gather, charged no unusual or ad- 
 ditional sum because of an apprehension of war. It follows, in our 
 opinion, that the document is to be construed in the same way that the 
 same regular printed form would be construed if it had been issued 
 when no apprehensions were felt. It embodied simply an ordinary 
 bailment to a common carrier, subject to the implied exceptions which 
 it would be extravagant to say were excluded because they were not 
 written in. Business contracts must be construed with business sense, 
 as they naturally would be understood by intelligent men of affairs. 
 The case of The Styria, supra, although not strictly in point, tends in 
 the direction of the principles that we adopt. 
 
 Decree reversed.*' 
 
 Mr. Justice Pitney and Mr. Justice Clarke dissent, upon grounds 
 expressed in the opinions delivered by Circuit Judges Dodge and Bing- 
 ham in the circuit court of appeals, 238 Fed. 668.=° - 
 
 *»Cf. Watts & Co. V. Mitsui & Co. [1917] A. 0. 227; Horlock v. Beal 
 [1916] A. 0. 486. 
 
 50 Effect of War on Pre-existing Contracts. — The outbreak of war may- 
 make performance illegal, or the government acting under its war powers 
 may directly or indirectly prevent performance. In such cases the contrac- 
 tual duty is terminated. Zinc Corp. v. Hirsch, [1916] 1 K. B. 541 (with note 
 in L. K. A. 1917C, 662) ; Metropolitan Water Board v. Dick, [1918] A. O. 
 119, Ann. Cas. 19180, 390, 27 Yale L. Jour. 953 ; Moore & Tiemey v. Roxford 
 
928 DISCHAEGE OP CONi'EAdT (Ch. 5 
 
 CHAPTER V 
 DISCHARGE OF CONTRACT 
 
 SECTION 1.— RElvEASE AND COVENANT NOT TO SUE 
 
 SIR WILLIAM DRURY'S CASE. 
 
 (In the Common, Pleas, 1583. , Cro. Eliz. 14.) 
 
 J. S. makes an obligatioh, dated and delivered the first of May; arid 
 upon the first of June following, the obligee maketh a release to the 
 obHgor, bearing date the first of March; and delivered the first of 
 June, by which he releaseth all actions ab origine mundi until the date 
 of the release. And all the justices were of opinion, that the obliga- 
 tion was not released. 
 
 BRADEN et al. v. WARD. 
 (Supreme Court of New Jersey, 1880. ,42 N. J. Law. 518.) 
 
 A judgment for $1,941.89 had been obtained, and this was a pro- 
 ceeding for the enforcement of that judgment. The -judgment debtor ■ 
 had paid $1,200 to the creditor in satisfaction of this judgment and 
 had been given a release under seal. 
 
 Reed, J.^ * ' * * They contend further, however, that there has 
 been no satisfaction of this judgment. This contention is based upon 
 the fact thkt Bradett received only $1,200 for a judgment for $1,941, 
 
 Knitting Co. (D. C.) 250 Fed. 278, 28 Yale L. Jour. 399 (1918) ; Woodfleld S. 
 S. Co. y. Thompson. 36 T. L. B. 43 (1919). 
 
 "Eaonomio Unprofitableness" caused by war conditions is no excuse for non- 
 performance. Columbus Ry. Light & Power Co. v. City of Columbus, 249 U. 
 S. 399, 39 Sup. Ct. 349, 63 L..Bd. 669, 6 A. L. R. 1648 (1919), contract to 
 operate street cars for 25 years at a five-cent fare; City of Mporhead v. 
 Union Light, Heat & Power Co. (D. C.) 255 Fed. 920 (1918) ; Berthoud v. 
 Schweder & Co., 31 T. L. R. 404 (1915), defendant guaranteed a minimum of 
 commissions, and then war closed the exchange ; Assoc. P. C. Mf rs. y. Cory, 
 31 T. L. R. 442 (1913), danger of loss and, extra expense due to submarines; 
 Piaggio V. Somerville, 119 Miss. 6, 80 Soutli. 342 (1919), game; Leiston Gas 
 Co. V. Leiston, [1916] 2 K. B. 428, city bound to pay for minimum amount 
 of gas, even though forbidden to burn street lights; Blackburn Bobbin Co. 
 V. Allen, [1918] 2 K. B. 467, 8 A. L. R. 11, 119 L. T. 215, shipment by the 
 Baltic sea lUipossible, but expensive shipment by rail from Finland through 
 Sweden remained possible; Dixon v. Henderson, ( K. E.) 117 L. T. 636 
 (1917) ; Wilsons v. Tennants (C. A.) 114 L. T. 878, [1917] 1 K. B. 208 (1917). 
 See, further, notes in L. R. A. 1916F, 10, 71; Ann. Cas. 1918A, 1, 14; 3 A. L. 
 R. 1, 21. 
 
 1 The facts have been restated and part of the opinion has been omitted. 
 
Seel) EELEASB AND COVENANT NOT TO SUB 929 
 
 and the rule is invoked that the payment of a less sum will not satisfy 
 a debt. Cumber v. Wane, 1 Smith's Lead. Cas. 439; Daniels v. Hatch, 
 21 N. J. Law, 391, 47 Am. Dec. 169, 
 
 One of the exceptions to this rule is when the payment is acknowl- 
 edged by a release under seal. "But if the obligee or feoffee do at the 
 day receive a part, and thereof make an acquittance, under his seal, in 
 full satisfaction of the whole, it is sufficient by reason of the deed 
 amounteth to an acquittal." Co. Litt. 212b. 
 
 There was such an acquittal given by Braden to Ward & Ruther- 
 ford. 
 
 The relators contend, again, that the character of a sealed instru- 
 ment has been so changed by the act of 1875, (Rev. p. 387, § 52,) that 
 the acquittance has lost its common-lavv signification. 
 
 The act reads, that "In every action upon a sealed instrument, or 
 where a set-off is founded on a sealed instrument, the seal shall be 
 only, presumptive evidence of a sufficient consideration, which may be 
 rebutted, as if such instrument was not sealed." 
 
 I do not think this act aids the relators. If this statute includes 
 within its operation sealed instruments like the release attacked, and it 
 were permissible to inquire into its consideration, I do not see how it 
 would invalidate this acquittance. 
 
 This act received a construction in the case of Aller v. Aller, 40 N. 
 J. Law, 449. It was in that case held that the design of the act was 
 not to change the character of a sealed instrument not shown to be 
 fraudulent or illegal. It was held that a voluntary gift made under 
 seal was enforceable — that in sealed instruments where it was evident 
 no consideration was intended, the absence of a consideration was not 
 essential. 
 
 By the same reasoning, when it appears that the consideration 
 which the parties intended to pass, actually did pass, the instrument 
 is valid. That is the admitted fact concerning the consideration for 
 this release. 
 
 But the act was never intended to operate upon, and its terms do 
 not include a release under seal. This release is not a sealed instru- 
 ment upon which an action is brought, nor upon which a set-off is 
 founded. This seems too obvious for discussion. 
 
 If any authority for such a view is requisite, it is found in the con- 
 struction placed upon it by the courts of New York, whence this act 
 comes. 
 
 It is found set out in the opinion in the case of Calkins v. Long, 22 
 Barb. (N. Y.) 99, where the act is construed, and also in the case of 
 Gilleland, Ex'r, v. Failing, 5 Denio (N. Y.) 308. 
 
 In Stearns v. Tappin, ■ 5 Duer. (N. Y.) 294, it was expressly held 
 that the statute did not apply to a release under seal. 
 
 COEBIH CONT 59 
 
930 DISCHARGE OF CONTRACT (Gh. 5 
 
 STIEBEL et al. v. GROSBERG. 
 
 (Court of Appeals of New York, 1911. 202 N. Y. 266, 95 N. E. 692, 36 L. R. 
 A. [N. S.] 1147, Ann. Cas. 1912D, 1305.) 
 
 Action by Samuel J. Stiebel and others against John Grosberg. 
 From a judgment of the Appellate Division (137 App. Div. 275, 121 
 N. Y. Supp. 923) affirming a judgment for plaintiffs, defendant ap- 
 peals. Reversed, and remanded. 
 
 Haight, J.= This action was brought to recover the amount of a 
 promissory note executed by the defendant on the 31st day of Decem- 
 ber, 1906, in which he promised to pay to the plaintiffs on demand the 
 sum of $37,372.87, with interest. The defense interposed by the de- 
 fendant was a written release, signed, sealed, and delivered by the 
 plaintiffs to him on the 31st day of December, 1907. A reply was serv- 
 ed by the direction of the court, in which the plaintiffs alleged that the 
 release was given or intrusted to the defendant with the understand- 
 ing that it was not to have a legal inception or effect as a release, or as 
 a delivery, and was to be returned upon demand. There was no al- 
 legation in the reply to the effect that the release was delivered con- 
 ditionally to become operative in case the defendant should be forced 
 into bankruptcy; and, in case he was not adjudged a bankrupt, that the 
 release should be returned to the plaintiffs. 
 
 Upon the trial of the case after the jury had been impaneled, the 
 counsel for the defendant moved the court for judgment on the plead- 
 ings, thus bringing up for the determination of the court the question 
 as to whether the reply contained any allegations that would nullify 
 the release. The court denied the defendant's motion, and an exception 
 was taken. Thereupon the plaintiffs' counsel opened his case to the 
 jury, stating what he proposed to prove relating to tiie release, and 
 then the defendant's counsel again moved for judgment upon the open- 
 ing, which motion was also denied and exception taken. Thereupon , 
 one of the plaintiffs was sworn as a witness, and gave testimony under 
 the objection and exception of the defendant, to the effect that the 
 defendant had applied to him for a release, stating, in substance, that 
 he had been sick and had lost all that he had ; that one of his creditors 
 had commenced action against him ; that he could not pa!y and would 
 be compelled to go into bankruptcy unless he could stave it off ; that 
 he considered the plaintiffs' claim a debt of honor which he would pay 
 when he was able to do so ; that he wanted a release which he would 
 only use provided he was forced into bankruptcy ; if he did not have 
 to go through bankruptcy, he would return it. The plaintiffs then 
 called the defendant as a witness, and showed from him that he had 
 not been forced into bankruptcy, and then rested. The defendant of- 
 
 2 Parts of the opinion are omitted. 
 
Sec. 1) RELEASE AND COVENANT NOT TO SUB 931 
 
 fered no testimony in his own behalf, but moved for a direction of a 
 verdict in his favor, "on the ground that the release is conclusive upon 
 the parties, being a deed executed by the plaintiffs and now shown to 
 have been duly delivered. It was turned over as a valid instrument 
 at the time it was delivered and could not be accompanied by any con- 
 dition resting in parol, and it was not pleaded in the reply that there 
 was any parol condition in regard to the delivery." The motion of the 
 defendant was denied and exception taken, and a verdict was directed 
 in favor of the plaintiffs for the amount of the note, with interest, to 
 which an exception was also taken. 
 
 The questions thus presented are : 
 
 First. Can a written release under seal be shown to have been de- 
 livered conditionally upon the happening of an event in the future upon 
 an oral agreement that it should be returned in case the event did not 
 happen? 
 
 Second. Was the conditional delivery properly pleaded in plain- 
 tiffs' reply? 
 
 At common law the seal to a written instrument was conclusive evi- 
 dence of a sufficient consideration, and its conclusive character could 
 not be changed by parol testimony. This rule of the common law, how- 
 ever, was modified by the statute (2 R. S. 406, § T7'), which is now em- 
 braced in oUr Code of Civil Procedure, §■ 840, which provides that a 
 seal upon an executory instrument, hereafter executed, is only pre- 
 sumptive evidence of a sufficient consideration, which may he rebutted, 
 as if the instrument was not sealed. Neither a receipt nor a release 
 is a contract or an executory instrument. They are merely declara- 
 tions or admissions in writing, and consequently it was held that the 
 modification of the statute with reference to seals upon executory in- 
 struments does not extend to releases, which, when under seal, continue 
 to be conclusive evidence of a sufficient consideration. Gray v. Barton, 
 55 N. Y. 68-71, 14 Am. Rep. 181 ; Ryan v. Ward, 48 N. Y. 204-208, 
 8 Am. Rep. 539. 
 
 For upwards of a century, or from the case of Fitch v. Sutton, 5 
 East, Rep. 230, down to the cases above cited, it has been repeatedly 
 held that the giving of a receipt in full payment by a creditor of an un- 
 disputed account or claim does not conclude him from recovering the 
 balance, although the receipt was given with knowledge and there was 
 no error or fraud. The reason for so holding was that the receipt, 
 not being under seal, was not conclusive upon the question of consid- 
 eration ; and, upon it appearing that there was no consideration for the 
 receipt, it became of no binding force. Of course, this rule has no 
 application to claims or accounts, which are in dispute, in which the 
 parties agree upon a compromise, or where a receipt is given for un- 
 liquidated demands. Coon v. Knap, 8 N.' Y. 402, 59 Am. Dec. 502; 
 Kellogg V. Richards, 14 Wend.. 116. It therefore follows that Hqui- 
 dated and undisputed claims or accounts can be discharged by pay- 
 
932 DISCHARGE OP CONTEAOT (Ch. 5 
 
 ment, or by the creditor executing a release under seal, by which he 
 precludes himself from attacking the consideration for the release. 
 
 A release, however, must be delivered in order to become effective. 
 The delivery is a separate, independent act from that of executing it. 
 The same is true with reference to a deed of real estate. It has to be 
 delivered in order to pass title and the right of possession of lands. 
 The effect of a delivery of a deed cannot be changed by parol testi- 
 mony. Hamlin v. Hamlin, 192 N. Y. 164, 84 N. E. 805. The reason 
 for this rule is that the title and right of possession passes to the 
 grantee upon delivery, and no person would be secure in his title and 
 possession of real estate if it could be destroyed by oral testimony. 
 The appellant claims that the same rule should apply to the delivery of 
 a release; that the effect of such a delivery, cannot be subsequently 
 changed by parol testimony. Our attention has not been called to any 
 case in this court in which this precise question has been decided. 
 
 In the case of Reynolds v. Robinson, 110 N. Y. 654, 18 N. E. 127, 
 a question arose upon a finding of a contract for the purchase and sale 
 of lumber on credit, accompanied by an oral understanding of the 
 parties that the delivery should be contingent upon satisfactory re- 
 ports of commercial agencies as to the pecuniary responsibility of the 
 plaintiff. In that case we have a writing which is in form a complete 
 contract which has been delivered upon a parol condition that it was 
 not to become binding until the happening of a future event that had 
 not occurred, and it was held that the condition might be proven by 
 parol. 
 
 In the case of Blewitt v. Boorura, 142 N. Y. 357, 37 N. E. 119, 40 
 Am. St. Rep. 600, the action was brought to obtain an accounting, and 
 for damages by reason of the violation of a contract, under seal, en- 
 tered into between the parties in relation to the right to manufacture 
 and sell a temporary binder for books. The defendants admitted the 
 execution of the contract, but alleged that it had been delivered upon 
 the parol condition that it was not to operate as a contract until the 
 plaintiff had acquired the interest of a third person, which it is alleged 
 he failed to acquire. Upon the trial oral evidence showing the condi- 
 tion and failure to perform was received, and the court found the facts 
 accordingly. The question brought up for review was as to the com- 
 petency of such evidence, and it was held that the contract was not re- 
 quired to be under seal, and that the evidence was competent. * * * 
 
 Attention has been called to the common-law effect of a seal, and to 
 the fact that the rule has not been changed by statute so far as releases 
 are concerned. A release or receipt, however, is perfectly good with- 
 out a seal, provided the holder can show that full payment has been 
 made therefor. The seal is only necessary when the payment of ade- 
 quate consideration is questioned. With a delivery of a deed of real 
 estate the rights of parties change. The grantor parts with his title 
 and possession, and the grantee is vested with title and the right to 
 
Seel) RELEASE AND COVENANT NOT TO SUE 933 
 
 immediate possession. In the acknowledgment of the payment of a 
 claim or the delivering of a release therefrom, the change that takes 
 place between the parties is entirely different. If the release be deliver- 
 ed without consideration, the maker receives nothing and only parts with 
 his right to prosecute the claim. The person receiving the release re- 
 ceives no additional property right, but merely is relieved from a claim 
 that might be prosecuted against him. The reasons, therefore, which 
 exist with reference to the delivery of deeds of real estate, do not exist 
 with reference to the delivery of releases. The act of executing re- 
 leases is separate and distinct from acts of delivery. The delivery has 
 to be shown independent of the instrument ; and, while parol evidence 
 is incompetent for the purpose of changing or explaining the meaning 
 of the written instrument, we incline to the view that oral evidence 
 may be given for the purpose of showing whether the delivery of the 
 instrument was intended to be absolute or conditional. 
 
 With reference to the second question brought up for review, it ap- 
 pears, as we have seen, that the plaintiffs' reply did not specifically al- 
 lege that the release was delivered conditionally and was to be returned 
 in case the defendant was not forced into bankruptcy. * * * 
 
 We think that the reply was defective in the particular mentioned, 
 and that consequently the court erred in its rulings with reference 
 thereto. It follows that for this reason the judgment should.be re- 
 versed and a new trial ordered, with costs to abide the event. 
 
 Judgment reversed, etc. 
 
 GIBBONS V. VOUILLON. 
 (In the Common Pleas, 1849. 8 C. B. 483.) 
 
 Wii.DE, C. J.* This question arises upon a plea which sets forth an 
 agreement under seal between the defendant of the first part, three 
 individuals named, 'as trustees, of the second part, and the plaintiff and 
 certain other persons, creditors of the defendant, of the third part; 
 and the plea, which is pleaded either as a bar to the action generally, 
 or, in bar of the further maintenance of the action, states that the 
 defendant had carried on the business of a silk-mercer; that the 
 several debts due to the parties of the second and third parts, which 
 were set opposite to their respective names, had accrued; that the 
 defendant was unable immediately to satisfy those debts ; that, for the 
 purpose of realizing his effects, it had been deemed advantageous to 
 all the parties interested, that the defendant should, for five years, be 
 permitted to carry on the business, under the inspection of the trustees ; 
 and that it was agreed that the business should be so carried on for the 
 said term of five years. The plea then goes to state, that, in pursuance 
 of the agreement, the several persons parties thereto of the second and 
 
 'The statement of facts and the concurring opinion of Williams, J., are 
 omitted. 
 
934 DISCHAEGB OF CONTKAOT (Ch. 5 
 
 • third parts, by that indenture gave and granted unto the defendant 
 until May 17th, 1848 (the indenture bearing date May 17th, 1843), 
 full and free license and authority to pass and repass, etc.; and 
 that it was further provided, that, if any of the said persons parties 
 tliereto of the second and third parts, should, at any time there- 
 after during the continuance of the license thereby granted, molest 
 or interfere with the defendant, contrary to the true intent and mean- 
 ing of the said indenture, the defendant should be released, exon- 
 erated, acquitted, and forever discharged of and from all debts and 
 demands whatsoever which were then due unto^ or then could be made 
 by, the creditor or creditors respectively by whom the said letter of 
 license thereinbefore contained should in any such respect be con- 
 travened, and of and from all manner of actions, suits, etc., by rea- 
 son, on account, or in consequence of the same debts or demands 
 respectively, and that the said indenture should or might be pleaded 
 in bar to such respective debts or demands accordingly. The molesta- 
 tion or interference herein mentioned must be- intended to mean such 
 sort of molestation and interference as the parties lawfully might re- 
 sort to, having relation to their situation as creditors and debtor. 
 
 The question is, whether or not effect may be given to this agreement 
 of the parties. Now, the first part of the deed~ operates as a letter of 
 license, with a covenant on the part of the creditors not to sue within 
 a limited time. This, it is contended, on the part of the plaintiff, 
 cannot be pleaded in bar; but it is said, upon the supposed authority 
 of Ford V. Beech, that the only remedy of the covenantee is, by a 
 cross action for damages. Nothing, however, fell from the Court in 
 Ford V. Beech, to countenance that supposition. Why is it that a 
 covenant not to sue for a limited time cannot be pleaded in bar? By 
 reason of the rule that the right to a personal action once vested, and 
 suspended, by the voluntary act of the party, for however short a 
 time, is precluded and gone forever. It could only be pleaded in bar ; 
 for, that is its legal operation. To have allowed the agreement in Ford 
 V. Beech to be pleaded in bar as a release, would have been obviously 
 contrary to the intention of the parties; and no injustice followed 
 from holding that the defendant's remedy for a breach was to be 
 found in a cross action. But how does that apply where we have to 
 deal with express and unequivocal words, and in a case where there 
 are circumstances to warrant our concluding that the parties intended 
 to give a totally different effect to the contract from what is before 
 stated? Here, we have to deal with a contract entered into in,express 
 terms between a debtor and a body of twenty or thirty creditors, each 
 of whom, for the benefit of the general concern, agrees that the debtor 
 shall for a given period continue to carry on the business without 
 molestation, and that, if that contract should be contravened by any 
 creditor molesting or interfering with the debtor, such molestation or 
 interference should operate an extinguishment of the debt, and that the 
 indenture might be pleaded in bar to such debt. How would it be pos- 
 
Seel) RELEASE AND COVENANT NOT TO SUE 935 
 
 sible to secure the object the parties had in view, if effect could not be 
 given t»> the agreement in the terms in which they have framed it? 
 The intention is beyond doubt. A covenant not to sue for a given time 
 enures as a release, not by the mere agreement of the parties, but by 
 operation of law. '' 
 
 Then it is said that that which has occurred here is not a molesta- 
 tion within the meaning of the deed. Looking at all the circumstances, 
 it is impossible to doubt that suing the debtor was the very species ' 
 of molestation which the parties sought to guard against, and no other'. 
 They clearly could not have had anything else in their contemplation. 
 When, therefore, this action — which in the ordinary course would' 
 go on to judgment and execution — was brought, the defendant had 
 a right to assume that it was brought for the purpose of molesting or 
 interfering with him, and so preventing him from carrying into effect 
 the contract he had entered into. In the absence, therefore, of any- 
 thing to control it, it seems to me that the parties contemplated a moles- : 
 tation by suing out a writ. 
 
 The cases referred to in Rolle's Abridgment appear to me to af- 
 ford distinct authority on the present occasion. We are to consider 
 what is the effect of this deed, taking the whole of it together. On 
 the part of the defendant, it is contended that the deed, taken altogether, 
 operates as a release ; and accordingly he pleads it in bar. The plain- 
 tiff's counsel, on the other hand, argues -with much ingenuity, that, if 
 we hold it to be a release, we must hold it to be a release from the 
 moment of its execution; and that is manifestly contrary to the inten- 
 tion of the parties. To extinguish the debt, would manifestly be to 
 defeat the whole intention of the deed. But upon what assumption 
 is that ground taken? Upon the assumption that every release, to 
 have any operation at all, must operate from the moment at which it 
 is given. I must confess I do not assent to that proposition. I do not 
 see why parties may not agree that a certain instrument shall operate as 
 a release, from the happening of such an eyent. The passage in Co. 
 Litt. referred to by my brother Maule, seems to show that they may. 
 There is, then, a clear and manifest intent, to be collected from the 
 deed, that it shall operate as a release, from' the happening of the event 
 which the parties contemplated, viz., the molestation which has hap- 
 pened. It is no reason why effect should not be given to the clear 
 intention of the parties, that, in so doing, we necessarily carry its 
 operation somewhat beyond what was contemplated. 
 
 For these reasons, I am of opinion that the defendant is entitled to 
 our judgment. 
 
 Judgment for the defendant.* 
 
 * In accord, with excellent argument; T. B. 21 Hen. VII, 23 and 24, 15; 21 
 Hen. VII, 30, 10. 
 
936 DISCHARGE OF CONTRACT (Ch. 5 
 
 DOWSE V. JEFFERIES. 
 
 (In the Court of Common Pleas, 1594. 1 And. 307.) 
 
 Dowse brought action of debt against Jefferies on obligation.. The 
 defendant pleaded in bar that the plaintiff by his deed indented since 
 the making of the obligation granted to the defendant that he would 
 not prosecute or molest the said defendant Jefferies by reason of the 
 said obligation before the feast of St. John the Baptist, 1590, and de- 
 manded judgment. To this there was a demurrer, and the court ad- 
 judged that it was no bar, but rather a covenant of which the defend- 
 ant could take advantage in his own behalf and not otherwise, and 
 so the words and the intent of the covenant appear to be ; for it does 
 not appear that he is never at any time to sue the defendant on this 
 obligation, but that he is not to sue him before a certain day, there be- 
 ing a great difference between these two cases. Where the covenant 
 is like this one, until a certain time only, the damage is not so great 
 as in the case where suit is never to be brought. In the one case dam- 
 ages are not to be recovered except in accordance with the harm that 
 the defendant suffers by the suit's being brought before the proper 
 time, and in the other case for the entire amount of the obligation and 
 other loss sustained by the suit and recovery on the obligation. In 
 the latter case, in order to avoid circuity of action, there is ground 
 for allowing the covenant to be pleaded in bar of the action, but not 
 in the former case; for in such a case it would not accord with ei- 
 ther the words or the intent of the party plaintiff.^ 
 
 LACY v. KINNASTON. 
 
 (In the King's Bench, 1702, Holt, K. B. 178.) » 
 
 This case is not stated in the books ; but only that it was held by 
 Holt, C. J., that a perpetual covenant never to take any advantage of 
 a deed or covenant, is a release or defeasance of that deed or cov- 
 enant ; as where a man enters into an obligation to another, who cov- 
 enants never to take any advantage, or to sue him upon that bond ; here 
 if afterwards an action of debt should be brought upon it, in such case 
 the obligor may plead this covenant in bar to the action, for the ob- 
 ligee by his covenant hath deprived himself of all the remedy he could 
 
 6 In accord: Thimbleby v. BaiTon, 3 M. & W. 210 (1838) ; Aloff v. Scrim- 
 shaw, 2 Salk. 573 (1689), "The ground of the decision in this case appears 
 to be that a personal action once suspended by the act of the party is gone 
 forever; therefore the covenant must be either an absolute discharge, or a 
 mere covenant; the former of vyhich, being manifestly repugnant to the 
 intent, shall not be implied." S. c, AylofCe v. Scrimpshire, Carth, 63, 1 
 Show. 46. Of. Leslie v. Conway, 59 Cal. 442 (1881). 
 
 Reported more fully in 1 Ld. Raym. 688, Salk. 575. 
 
Seel) RELEASE AND COVENANT NOT TO SUE 937 
 
 have upon this bondJ But if A. B. and C. D. are jointly and sev- 
 erally bound in a bond to E. F. who covenants never to sue C. D. 
 upon that bond; this is no release or defeasance of the bond, be- 
 cause it doth not discharge the right, only the remedy against C. D. 
 for he still hath a right of action against the other obligor ; * and there- 
 fore if the obligee should bring an action of debt upon this bond 
 against C. D. he is put to his action of covenant against the obligee, 
 upon the covenant entered into. 
 
 FORD V. BEECH. 
 (In the Exchequer Chamber, 1848. 11 Q. B. 852.) 
 
 The verdict was entered up as directed in the preceding judgment; 
 and judgment was entered on the record, with a consideratum est, 
 "that the plaintiff take nothing by his said writ, but that he be in 
 mercy, etc., and that the defendant go thereof without day, etc. ;" with 
 costs for defendarit against plaintiff, and award of execution thereof. 
 
 The plaintiff brought error in the Exchequer Chamber; assigning 
 for error, generally, that judgment ought to have been given for the 
 plaintiff; an^ also that judgment ought to have been given for the 
 plaintiff "by reason of the non-performance by the said William 
 Beech of the promise in the said third count of the said declaration 
 mentioned; that the said finding of the said jury on the said eighth 
 issue joined between" etc. "amounts to a finding in favor of the said 
 John Ford; and that judgment ought to have been given accordingly. 
 That the said finding is imperfect, uncertain, and argumentative, and 
 does not dispose of the whole of the said issue; and that no judg- 
 ment can be given thgreupon, or in respect thereof, or upon the said 
 record and proceedings." That the fifth and sixth pleas "are not, 
 nor is either of them, sufficient to bar the plaintiff from haying or 
 maintaining his action as to the causes of actipn to which those pleas 
 are respectively pleaded. That the said pleas show an accord only, 
 without satisfaction, or with only a partial satisfaction. That the said 
 pleas attempt' to set up, as a defence to the causes of action to which 
 they are pleaded, an accord and satisfaction by a stranger to those 
 causes of action. That the said pleas attempt to set up, as an answer 
 to the causes," etc., "the payment of a less sum than the amount which 
 they profess respectively to answer." Joinder. 
 
 Parke, B., in this vacation (February 3d), delivered the judgment of 
 the Court. 
 
 This is a writ of error brought to reverse a judgment of her Ma- 
 jesty's Court of Queen's Bench. The declaration is in assumpsit, and 
 
 ^ In accord: Chicago v. Babcock, 143 111. 358, 32 N. E. 271 (1892) ; Phelps 
 V. Johnson, 8 Johns. (N. Y.) 54 (1811). 
 
 8 In accord: Dean v. Newhall, 8 T. R. 168 (1799) ; Walmesley v. Cooper, 
 11 Adol. & El. 216 (1839). 
 
938 DISCHARGE OF CONTRACT (Ch. 5 
 
 contained five counts. The first count is upon a promissory note, 
 dated May 28th, 1839, made by the defendant, for the sum of il40 
 and interest, payable to the plaintifif twelve months after date; the 
 second count is also on a promissory, note, made by the defendant, iot 
 the sum of £200, payable with interest to the plaintiff, two years after 
 date. It is unnecessary to advert to the other counts in the declara- 
 tion, or to the pleadings connected with them. Judgment has been 
 given upon them for the defendant; and no question arises in re- 
 spect of that judgment. 
 
 The defendant pleaded, to the first count, that he did not make 
 the note therein mentioned, and the like plea to the second count. 
 Upon these pleas issues were joined, and verdicts have been found up- 
 on them for the plaintifif. The defendant also pleaded, to both the 
 first and second counts, that, after the making of the notes in those 
 counts respectively mentioned, and after the same notes respectively 
 became due, it was agreed, between the plaintiff, the defendant and 
 one Alfred Beech, that the said Alfred Beech should and wouldj at the 
 request of the plaintiff, pay to the plaintiff, in trust for Elizabeth 
 Beech, the sum of i200 for her own sole use and benefit, or the sum 
 of £25 per annum so long as the sum of £200 should remain unpaid, 
 which sum of £25 should be paid quarterly as therein mentioned; and 
 that the rights and causes of action of the plaintiff upon and in re- 
 spect of the said two several notes should be suspended so long as the 
 said A. B. should continue to pay the said sum of £6. 5s. every 
 quarter; the payments to commence as therein set forth. The plea 
 proceeds to aver that the said A. B. duly -paid the annual sum of 
 £25 quarterly according to the agreement. The plaintiff, in his repli- 
 cation to this plea, traversed the allegation of the payments alleged 
 to have been made by Alfred Beech of the .annual sum of £25 ; 
 and a verdict was found for the defendant upon the issue joined 
 upon that traverse. And, judgment having been given by the Court 
 of Queen's Bench for the defendant upon the verdict so found, 
 the present writ of error has been brought to reverse that judgment, 
 tipon the ground that, non obstante veredicto upon the matters in that 
 plea, judgment ought to have been given for the plaintiff ^upon both the 
 first aind second counts. The plaintiff has brought his writ of error, 
 praying for a reversal of this judgment. / 
 
 '■ And, upon the argument before us, the learned counsel for the 
 plaintiff has contended that the plea of the defendant to the first and 
 second counts of the declaration is badj and sets forth no matter 
 which is. in law a bar to his right of recovery upon those counts. 
 Upon the part of theplaintiff, the validity of the agreement mentioned 
 in the plea is not denied ; but it has been insisted, in the argument 
 before us, that the agreement does not in point of law operate as a 
 suspension of the plaintiff's right of action of power to sue for the 
 recovery of the notes mentioned in the first and second counts in the 
 declaration ; and that the plea, which sets up the agreement in bar of 
 
Sec. 1) RELEASE ANB COVENANT NOT TO SUE 939 
 
 the present action, is bad, and furnishes no answer to the action, 
 although such agreement may give the defendant a claim to damages 
 by reason of the plaintiff suing in breach of it. The defendant, on 
 the other hand, has contended before us that the legal operation of 
 the agreement is to suspend the plaintiff's right of action so long as 
 A. B. shall continue to make the quarterly payments ; and such agree- 
 ment has therefore been well pleaded in bar. The question for the de- 
 cision of the Court is, therefore, what is the legal effect of the agree- 
 ment between the parties, set forth in the plea ; that is, whether the 
 agreement operates as a legal suspension of the plaintiff's right to sue 
 upon the notes so long as A. B. shall continue to make the quarterly 
 payments ; or whether the effect of the agreement is limited to the 
 rendering the plaintiff liable to an action for damages in' the event of 
 his suing contrary to its terms. 
 
 In adjudicating upon the construction and effect in law of this 
 agreement, the common and universal principle ought to be applied; 
 namely, that it ought to receive that construction which its language 
 will admit, and which will best effectuate the intention of the parties, 
 to be collected from the whole of the agreement, and that greater 
 regard is to be had to the clear intent of the parties than to any par- 
 ticular words which they may have used in the expression of their 
 intent. And applying this rule, the question is, what sense and mean- 
 ing must be given to the word "suspended," used by the parties. It 
 is quite clear that it was not the intention of the parties that the 
 agreement should have the effect, from the moment of --its being 
 signed, of utterly and forever and in all events extinguishing the 
 plaintiff's claim . and demand upon the notes, and of ever maintain- 
 ing an action for the recovery; or, in other words, that it should 
 operate as a release of the money due upon them.' This is plain from 
 the words which import that the plaintiff might sue upon the notes 
 when A. B. should cease to make the quarterly payments mentioned 
 in the agreement. 
 
 It is a very old and well-established principle of law, that the 
 right to bring a personal action, once existing and by act of the party 
 suspended for ever so short a time, is extinguished and discharged, 
 and can never revive. It is said in Piatt v. The Sheriffs of London 
 [Plowd. 35, 36] : "And if a personal thing is once in suspense, or 
 the person of a man once discharged for a personal thing, it is a dis- 
 charge forever." And in Lord Noith v. Butts [2 Dyer, 139b, i40a 
 (39) ] it is said : "A thing personal or suspended, or action personal 
 suspended for an hour, is extinct and gone forever, when it is by the 
 act and consent of the party himself who has the thing suspended,." 
 And in Woodward v. Lord Darcy [Plowd. 184] it is said: "For a 
 personal action once suspended by the act or agreement of the par- 
 ty is always extinct and then if a personal thing cannot be had but 
 by action, if the action is extinguished, the thing itself is extinguish- 
 ed." The principle thus laid down is repeated throughout the text- 
 
940 DISCHARGE OF CONTRACT (Ch. 5 
 
 books of authority, and recognized and applied through a long course 
 of decision. And in Cheetham v. Ward [1 Bos. & P. 630, 633] it is 
 said by Lord Chief Justice Eyre that the principle is "now acknowledg- 
 ed, that where a personal | action is once suspended by the voluntary 
 act of the party entitled to it, it is forever .gone and discharged." 
 
 To construe the agreement, therefore, to operate as a legal sus- 
 pension or bar of the plaintiff's right to sue until the quarterly pay- 
 ments should cease, would have the effect of precluding him from 
 ever suing at ail, and of giving to the agreement the effect of an im- 
 mediate release of the demand upon the notes, and an extinction of 
 the debt. It follows that giving such meaning and effect to the word 
 suspended, used in the agreement, would be contrary to the intention 
 of the parties : and it is a well-approved rule of law that, where par- 
 . ties have used language which admits of two constructions, the one 
 contrary to the apparent general intent and the other consistent with 
 it, the law assumes the latter to be the true construction!* * * * 
 
 Applying the rules of construction before referred to to the present 
 case, and in order best to effectuate the intention of the parties, it is 
 necessary to construe the agreement to mean that the plaintiff agreed 
 to forbear his suit until the quarterly payment should cease to hb 
 made ; and that the effect of such agreement on his part was, not to 
 suspend his right of action in the meantime, but to subject him to an 
 action for damages in the event of his suing contrary, to his agree- 
 ment. 
 
 The general doctrine of suspension of personal actions appears to 
 be applicable to cases where persons have, by their own acts, placed 
 themselves in circumstances incompatible with the application of 
 the ordinary legal remedies; the cases generally referred to in the 
 books being where the party to pay and to receive have become iden- 
 tical, or where the same person was necessary to be joined at once 
 both as plaintiff and defendant, which by law cannot be ; such as a 
 creditor making his debtor his executor, or a debtor making his credi- 
 tor executor, or debtor and creditor marrying, or similar cases of in- 
 capacity to sue; as to which the authorities are numerous^ see Co. 
 Litt. 264b, also Butler's note ib. (209), Woodward v. Lord Darcy 
 [Plowd. 184], Sir J. Nedham's Case [8 Rep. 13Sa], Dorchester v. 
 Webb [Cro. Car. 372], Wankford v. Wankford [1 S'alk. 299], Freak- 
 ley V. Fox [9 B. & C. 130J, 2 Williams on Executors, 1124 [Ed. 4]. 
 
 The only case in which a covenant or promise not to sue is held to 
 be pleadable as a bar, or to operate as a suspension, and by conse- 
 quence a release or extinguishment of the right of action, is where 
 the covenant or promise not to sue is general, not to sue at any time. 
 In such cases, in order to avoid circuity of action, the covenants may 
 be pleaded in bar as a release, note (1) to Powell v. Forrest [2 Wms. 
 Saunders, 47 gg] , for the reason assigned, that the damages to be re- 
 
 » The discussion of several authorities is here omitteiJ. 
 
Seel) BELEASE AND COVENANT NOT TO SUB 941 
 
 covered in an action brought for suing contrary to the covenant would 
 be equal to the debt (Smith v. Mapleback [1 T. R. 441, 446]) or sum 
 to be recovered in the action agreed to be forborne. Accordingly, in 
 Deux v. Jeflferies [Cro. Eliz. 352], in debt on obligation, the defend- 
 ant pleads that the plaintiff covenanted that he would not sue before 
 Michaelmas; it was resolved, upon demurrer, for the plaintiff, for 
 that it was only a covenant not to sue, and should not enure as a re- 
 lease, nor could be pleaded in bar, but the party was put to his writ of 
 covenant, if sued before the time. "But if it had been a covenant that 
 he would not sue it at all, there peradventure it might enure as a re- 
 lease, and to be pleaded in bar, but not here; for it never was the 
 intent of the parties to make it a release." And there are other au- 
 thorities to the like effect. The agreement in the present case, though 
 not under seal, being foimded upon a good consideration, may be ar- 
 gued to be equivalent in effect to a covenant, but cannot have a great- 
 er effect ; and, in the modern case of Thimbleby v. Barron [3 M. & 
 W. 210], it was held that a covenant not to sue for a limited time for 
 a simple contract debt could not be pleaded in bar to an action for 
 such debt. In that case the plaintiff had covenanted that he wpuld 
 not, before the expiration of ten years, demand or compel payment 
 of certain sums of money, nor would take any means or proceedings 
 for obtaining possession or receipt of the same. Lord Abinger, C. B., 
 said: "The breach of the agreement to forbear suing renders the 
 party liable in damages, but it is not pleadable in bar:" and Parke, B., 
 said : "The books are full of authorities" against the defendant, and 
 referred to Ayloffe v. Scrimpshire [Carth. 63 ; 1 Show. 46] : judg- 
 ment for plaintiff. In 1 Roll. Abr. 939, Tit. Extinguishment (L,) , plea 
 2, it is said that, if the obligee covenant not to sue the obligor before 
 such a day, and, if he do, that the obligor shall plead this as an ac- 
 quittance, and that the obligation shall be void and of none effect, this 
 is a suspension of the debt, and by consequence a release. It must be 
 observed that in that case it was expressly covenanted that, in the 
 event of the covenantor suing upon the obligation contrary to his 
 covenant, the obligation should be void, and that the obligor or cov- 
 enantor should plead the covenant as an acquittance, which, by con- 
 • sequence, was a release ; the covenant in that case therefore went 
 much beyond a mere covenant not to sue. 
 
 By holding the plea in question a valid bar, injustice would be 
 done to the plaintiff, who would lose his demand upon the notes, 
 contrary to the intention of the parties ; but, by construing the agree- 
 ment not to operate as a suspension of the plaintiff's right of action 
 upon the notes, but as giving a remedy to the defendant by a cross 
 action to recover damages to the extent of the injury sustained by 
 the defendant by the plaintiff suing in breach of the agreement, no 
 injustice is done to the defendant. 
 
 Nor is such a construction inconsistent with the class of authorities 
 in which matters were allowed to be pleaded in bar in order to avoid 
 
942 DISCHARGE OF CONTRACT (Ch. 5 
 
 circuity of action, because such decisions are limited to cases in which, 
 from the nature of them, the damages to be recovered must be suppos- 
 ed to be equal in both actions; Smith v. Mapleback [1 T. R. 441, 446], 
 which does not apply to the present instance, as the damages to which 
 tbe defendant could be entitled as against the plaintifif, by reason of 
 his suing upon the notes before a discontinuance of the quarterly pay- 
 ment, can in no view be assumed to be equal to the plaintiff's demand. 
 
 Neither is the decision in this case inconsistent with the several 
 cases in which it has been held that a party accepting a negotiable secu- 
 rity payable in future for and on account of an antecedent demand 
 cannot, until after such negotiable security has become due and been 
 dishonored, sue for such antecedent demand; because, independently 
 of the consideration Of how far the acceptance of such negotiable se- 
 curity may be deemed payment for the time, all such decisions seem 
 to be grounded upon the peculiar nature of the negotiable instruments, 
 and are deemed to be necessary exceptions to the geneiral rules of law, 
 in favof of the law merchant; see note (c) to Holdipp v. Qtway [2 
 Wms. Saunders, 103b]." 
 
 The case of Stracy v. The Bank of England [6 Bing, 754] was cited, 
 on the defendant's behalf, as an authority to the effect that a right to 
 bring a personal action may be suspended by agreement, without oper- 
 ating as a release or extinguishment. But, upon examination, it will 
 be found probably not to be an authority bearing upon the point. The 
 action was brought to recover damages for an alleged breach of a pub- 
 lic duty in not making a transfer, upon request, of certain stock, to 
 which the plaintiffs were entitled; the defendants insisted that the 
 plaintiffs had for good consideration agreed rtot to make such request 
 until they had themselves done certain acts; and alleged that the 
 plaintiffs, contrary to their agreement, made the request,: for the non- 
 compliance with which they brought their action, before they had 
 done those acts : the defendants therefore contended that such non- 
 compliance was no breach of duty on their part. There was no right 
 of action suspended by the agreement; as it is clear from the case 
 that no. request had ever been made to the Bank to transfer the stock, 
 and no means had ever been given to enable the Bank to do so, no name 
 of a transferee having been given at the time when the agreement was 
 made, nor for a. long time afterward: consequently, the only right of 
 action the plaintiffs ever asserted was a right founded upon a request 
 made long after the agreement. The decision, therefore, was, not that 
 any existing right of action was suspended by the agreement, but that 
 the plaintiff suspended his right to call upon the defendants to make a 
 transfer until after he had done the acts mentioned in the agreement. 
 And, although the expression of suspending an action was used, per- 
 haps inaccurately, yet it is plain that they referred to the right to call 
 for the transfer of the stock, and to that only. At all events, as a 
 
 i" See Goodrich v. Friedinan, infra, p. 942. 
 
Sec. 1) . EELEASE AND COVENANT NOT TO SUB 943 
 
 decision upon the point for which the case was cited, it could not be 
 supported, as it would be inconsistent with an undoubted principle of 
 law and an undeviating course of authority. 
 
 In the result, we are of opinion that the plea in question is bad in 
 substance, and that the judgment which has been pronounced upon it 
 in favor of the defendant must be reversed, and a judgment entered 
 for' the plaintiff, non obstante veredicto, upon the confession and in- 
 sufficient avoidance in the plea. 
 
 Judgment accordingly.^^ 
 
 WEST V. JONES. 
 (Superior Court of Delaware, 1919. 7 Boyce, 509, 108 Atl. 675.) 
 
 Action by William H. West against Robert H. Jones on promissory 
 note. On motion for judgment at first term notwithstanding' the affi- 
 davit of defense filed. Judgment entered for plaintiff. 
 
 Boyce and Rice, JJ., sitting. 
 
 Plaintiff on or before the first day of the term to which the process 
 was returnable filed copy of the promissory note, sued on after ma- 
 turity, with an affidavit of demand, in accordance with Rev. Code 1915, 
 § 4169. The note with the indorsements thereon was in the following 
 words and figures: 
 
 $2,500.00 8357 
 
 Philadelphia, Pa., May 24, 1919. 
 Four months after date I promise to pay to the order of myself, 
 two thousand five hundred no/100 dollars at office Guaranty Funding 
 Corporation, 1535 Chestnut St. Without defalcation. For value re- 
 ceived. 
 
 No. . ' Due 9—24—19. 
 
 Robert H. Jones, 
 107 West 9th St. Wilmington, Del. 
 Indorsements : 
 
 Robert H. Jones. 
 John McClintoch, Jr. 
 W. H. West. 
 Daniel A. Ingler, 
 
 1215 Mafket St, , 
 
 The defendant filed an affidavit of defense, the nature and charac- 
 ter of which is : 
 
 The defendant on the 24th day of. May, A. D. 1919, executed and in- 
 dorsed a note in the sum of twenty-five hundred dollars ($2,500.00), 
 payable four months after date (being the note in suit), and the said 
 note was delivered by the said defendant to W. A. Benjamin, who was 
 
 *i Cf. cases in note to Good v. Cheesman, infra, p. 986. 
 
944 DISCHAKGE OB" CONTEAOT . (Ch. 5 
 
 expressly authorized and appointed by the said defendant, as his agent 
 to act in and about the discount or sale o£ the said note, and the said 
 note 'yvas in turn delivered by the said W. A. Benjamin to the said 
 plaintiff, and by him discounted.; that subsequent thereto the said 
 plaintiff agreed with the said W. A. Benjamin, who was then and there 
 acting as agent for the said defendant, that the said plaintiff would 
 renew thfe said note at maturity for a further period of four months 
 upon the payment to the said plaintiff of the interest then due and the 
 further sum of two hundred and fifty dollars ($250.00) ; that prior 
 to the maturity of the said note the said W. A. Benjamin, acting as 
 agent for the said defendant, did tender to the said plaintiff a new 
 note of the said defendant (a copy of which is hfereto attached and 
 marked Exhibit A), and did also tender the interest then due and the 
 sum of two hundred and fifty dollars ($250.00) as a consideration for 
 the renewal of the said note, and in accordance with said agreement ; 
 that the said plaintiff refused to accept the said renewal note, interest, 
 and the sum of two hundred and fifty dollars ($250.00), and refused 
 to renew the said note. 
 
 Plaintiff moved for judgment notwithstanding the affidavit of de- 
 fense filed. 
 
 BoYcE, J., delivering the opinion : 
 
 The only defense to this action is that it was brought prematurely, 
 because the period for which the note sued upon was to be renewed 
 had not expired when the action was commenced. The question raised 
 must be determined upon the face of the affidavit of defense. An 
 agreement to renew or extend the time of the payment of a promis- 
 sory note based upon a sufficient consideration would be binding, and 
 if executed it will prevent the collection of the note until the expira- 
 tion of the period of extension. The oral agreement relied upon in 
 the affidavit of defense is collateral, and being unfulfilled it is no bar 
 to the action. Whatever redress there may be for nonperformance lies 
 in another action. Upon the whole, the affidavit of defense does not 
 disclose a legal defense to the whole or part of the cause of action, 
 necessary to prevent judgment on the affidavit of demand. Rev. Code 
 1915, § 4169. 
 
 Let judgment be entered for the plaintiff for the amount of his de- 
 mand with interest. 
 
Sec. 5) SUERENDEB AND CANCELLATION 945 
 
 SECTION 2.— SURRENDER AND CANCEU.ATION 
 
 SLADE et al. v. MUTRIE. 
 (Supreme Judicial Court of Massachusetts, 1892. 156 Mass. 19, 30 N. E. 168.) 
 
 Action by George H. Slade and others against James Mutrie on a 
 note. There was a judgment for defendant, and plaintiffs except. 
 Exceptions overruled. 
 
 Field, C. J. The counsel for the defendant concedes that by the 
 law of this commonwealth the payment of a part of the debt after the 
 whole debt has become payable is not a sufficient consideration to 
 support a promise not under seal to discharge the remainder of the 
 debt Tyler v. Association, 145 Mass. 134, 137, 13 N. E. 360; La- 
 throp V. Page, 129 Mass. 19 ; Grinnell v. Spink, 128 Mass. 25 ; Potter 
 V. Green, 6 Allen, 442 ; Harriman v. Harriman, 12 Gray, 341 ; Brooks 
 V. White, 2 M'etc. 283, 37 Am. Dec. 95 ; Foakes v. Beer, h. R. 9 App. 
 Cas. 605. The judge ruled that, "if the plaintiffs, at the time they re- 
 ceived the sum of one hundred and twenty-five dollars from the de- 
 fendant, and gave him a receipt in full of all demands therefor, sur- 
 rendered to the defendant the note in suit with the intention that the 
 same should be canceled, and that the debt thereby evidenced should be 
 extinguished, and intended to give to the defendant the balance of 
 the debt, and that the payment made was to be in full for said debt, 
 then the plaintiffs cannot recover on the note." The jury, in return- 
 ing a general verdict for the defendant, must have found that the 
 note was surrendered by the plaintiffs to the defendant that it might be 
 canceled, and that the plaintiffs intended, by delivering the note to the 
 defendant to giye him the note, and discharge the remainder of the 
 debt. For certain purposes a bill of exchange or a promissory note is 
 regarded in this commonwealth not merely as evidence of a debt, but 
 as the debt itself. They may be the subject of a gift, bAt to constitute 
 a gift, there must be a delivery by the owner to the donee, with the in- 
 tention of passing the title. Grover v. Grover, 24 Pick. 261, 35 Am. 
 Dec, 319; Sessions v. Moseley, 4 Gush. 87; Bates v. Kempton, 7 
 Gray, 382; Chase v. Redding, 13 Gray, 418. See Sheedy v. Roach, 
 124 Mass. 472, 26 Am. Rep. 680; Pierce v. Bank, 129 Mass. 425, 37 
 Am. Rep. 371; Taft v. Bowker, 132 Mass. -277; McCann v. Randall, 
 147 Mass. 81, 17 N. E. 75, 9 Am. St. Rep. 666; Cochrane v. Moore, 25 
 Q. B. Div. 57; Seminary v. Robbins, 128 Ind. 85, 27 N. E. 341, 12 
 L. R. A. 506. It follows from this that the delivery of a promissory 
 note by the holder to the maker, with the intention of transferring to 
 him the title to the note, is an extinguishment of the note, and a dis- 
 charge of the obligation to pay it. Hale v. Rice, 124 Mass. 292 ; Stew- 
 
 COBBIN CONT.. — 60 
 
946 DISCHARGE OF CONTRACT (Ch. 5 
 
 art V. Hidden, 13 Minn. 43 (Gil. 29); Ellsworth v. Fogg, 35 Vt. 355; 
 Vanderbeck v. Vanderbeck, 30 N. J. Eq. 265 ; Jaifray v. Davis, 124 N. 
 Y. 164, 170, 26 N. E. 351, 11 L. R. A. 710. " 
 Exceptions overruled.^'' 
 
 UCEY V. LICEY. 
 (Supreme Court of Pennsylvania, 1848. 7 Pa. 251, 47 Am. Dec. 513.) 
 
 Licey and others, administrators of Fretz, brought this action of 
 debt, and declared on a bond, the profert of which was excused by 
 averring possession unlawfully obtained by the obligor, who had torn 
 off the seal. 
 
 At the trial before Krause, P. J., the plaintiffs gave in evidence 
 the bond, of which the signature and seal had been torn off. The de- 
 fendant proved admissions by the obligee that she had given the bond 
 to the obligor to do what he pleased with it. 
 
 The court, on the authority of 2 Kent's Com. 439, was of opinion 
 an assignment, or transfer, actually executed, was essential, and di- 
 rected a verdict for the plaintiff. 
 
 Gibson, C. J.^' There is a ground on which, however, the cause was 
 not ruled below, that is fatal to the judgment. If the defendant's evi- 
 dence be true, the bond in suit was given up by the obligee to be can- 
 celled, and it was cancelled. Was not the debt, therefore gone? 
 There is a plain and well-founded common-law distinction, in this 
 particular, between things which lie in livery and things which lie 
 in grant. As the former pass by force of the livery, of which the 
 deed is only evidence, they cannot be revested by destroying the in- 
 strument, for a right can be dissolved only by the means which cre- 
 ated it; but, as the latter exist only by force of the deed, they neces- 
 sarily cease to exist when it no longer sustains them. . So far was this 
 carried in respect to things which depend on a deed, that an accidental 
 destruction o^ the seal was held, in the earlier cases, to destroy the 
 right, though a different rule prevails at present, by which the donee 
 is allowed to show the truth. But cancellation, eo animo, will now, 
 as it ever has done, destroy any right which stands exclusively upon 
 
 12 In accord : Lanham v. Meadows, 72 W. Va. 610, 78 S. E. 750, 47 L. B. 
 A. (N. S.) 592 (1913) ; Larkin v. Hardenbrook, 90 N. Y. 333, 48 Am. Rep. 
 176 (1882). 
 
 The destruction of the note by the holder with intent to make a gift operates 
 as a discharge. Sullivan v. Shea, 32 Cal. App. 369, 162 Pac. 925 (1916) ; Dar- 
 land V. Taylor, 52 Iowa, 503, 3 N. W. 510, 35 Am. Rep. 285 (1879) ; Gardner v. 
 Gardner, 22 Wend. (N. Y.) 526, 34 Am. Dec. 340 (1839) ; Denunzio v. Scholtz, 
 117 Ky. 182, 77 S. W. 715, 4 Ann. Gas. 529 (1903). 
 
 The Negotiable Instruments Law (Mass. St. 1898, c. 533, S 122; Consol. 
 Laws N. T. c. 38, § 203) now provides that a written renunciation shall dis- 
 charge a party to a negotiable instrument the same as a surrender of the 
 instrument itself. 
 
 '■^ Part of the opinion is omitted. 
 
Sec. 2) SUBBENDBE AND CANCELLATION , 947 
 
 the instrument. Thus a lease for years might have been surrendered 
 by cancellation before the statute of frauds, which now requires it 
 to be done, at least, by a note in writing. But the very case before 
 us is put as an instance of the principle in the last London edition 
 of Sheppard's Touchstone, 70. "And if a deed," it is said — "nay, a 
 bond — be delivered up to the party that is bound by it to be cancelled, 
 and it is so, or if he that hath the deed doth, by agreement between 
 him and the other, cancel the deed by either of these means the 
 deed (provided no estate passed by it) is become void." Even if 
 a bond thus delivered, but not cancelled, come again to the hands of 
 the obligee, though it be valid at law ^* the obligee will be relieved 
 in equity: Cross v. Powel, Cro. Eliz. 483; and see Vin. Abr. Faits, 
 X, 2, 3, 4. These authorities are decisive of the principle. * * * 
 Judgment reversed, and venire de novo awarded. 
 
 ATTORNEY GENERAL v. SUPREME COUNCIL A. L. H. 
 
 In re LAW. 
 (Supreme Judicial Court of Massachusetts, 1910. 206 Mass. 183, 92 N. E. 147.) 
 
 Information by the Attorney General, at the relation of the Insur- 
 ance Commissioner, against the Supreme Council American Legion 
 of Honor, to wind up the affairs of defendant, a fraternal beneficiary 
 association. From a decree disallowfng a claim based on a certificate 
 issued to Francis M. Law, claimant appeals. Reversed. 
 
 LoRiNG, J. Law's Case (claim 156) is another of the 17 appeals from 
 the decree of October 29, 1909. See Attorney General v. American 
 Legion of Honor (Hall's Case), 206 Mass. 158, 92 N. E. 136. 
 
 In this case the member died on June 9, 1902, and on September 
 22, 1902, the beneficiaries were paid $2,000 and surrendered the cer- 
 tificate for cancellation. 
 
 The local collector made an affidavit that after the adoption of by- 
 law 55 the member paid him "an assessment, or perhaps more than 
 one on the old basis, and that he sent it or them to the defendant at 
 Boston," that it or they were refused, but the member "continued to 
 tender me full payment on every assessment," and on his remittance 
 blanks to the Supreme Secretary "I made a note of this tender." 
 
 No evidence to control the facts so testified to was introduced. 
 We think that this was a sufficient protest to preserve the rights of 
 the member and that he is now erftitled to share in the emergency 
 
 1* "In debt on obligation the defendant pleaded that the plaintifie delivered 
 the obligation to him in lieu of an acquittance, and that afterwards he lost 
 the obligation and the- plaintiff found it ; by the whole court the plea was 
 held bad, for such a delivery is only matter in pais and it is necessary to 
 reply to this writ by matter in writing. Qufere whether the defendant could 
 have pleaded that it was not his deed, by reason of the second delivery." Y. 
 B. 5 Edw. IV, 4, 10. 
 
948 DISCHARGE OP CONTEAOT (Ch. 5 
 
 fund for the difference between what was paid the beneficiaries and 
 what is now due (see Dunlavy's Case, 206 Mass. 168, 92 N. E. 140, 
 and cases there cited), unless this claim has been released by the sur- 
 render of the certificate for cancellation. 
 
 It is laid down in Byles on Bills (13th Ed.) 199, that: "It is a 
 general rule of law, that a simple contract may before breach be 
 waived or discharged, without a deed and without consideration; but 
 after breach there can be no discharge, except by deed, or upon suffi- 
 cient consideration." This was stated in Dobson v. Espie, 2 H. & 
 N. 79, 83, to be an accurate statement of the law. To that effect see 
 Foster v. Dawber, 6 Ex. 839; Leake on Contracts, 654; Addison on 
 Contracts (10th Ed.) 160. 
 
 It is true that the surrender of a negotiable instrument operates as 
 a release. Slade v. Mutrie, 156 Mass. 19, 30 N. E. 168; Larkin v. 
 Hardenbrook, 90 N. Y. 333, 43 Am. Rep. 176; Ellsworth v. Fogg, 35 
 Vt. 355 ; Draper v. Hitt, 43 Vt. 439, 5 Am. Rep. 292 ; Vanderbeck v. 
 Vanderbeck, 30 N. J. Eq. 265 ; Young v. Power, 41 Miss. 197; Stew- 
 art V. Hidden, 13 Minn. 43 (Gil. 29). See, also, Simons v. American 
 Legion of Honor, 178 N. Y. 263, 268, 70 N. E. 776. But that rule 
 depends upon the law merchant. Foster v. Dawber, 6 Ex. 839; Cook 
 V. Lister, 13 C. B. (N. S.) 543, 592; Dobson v. Espie, 2 H. & N. 79, 83; 
 Byles on Bills (13th Ed.) 199, 200; Leake on Contracts, 565, 654; Ad- 
 dison on Contracts (10th Ed.) 160. 
 
 We are of opinion that the rule applied in Slade v. Mutrie, 156 Mass. 
 19, 30 N. E. 168, does not apply to common-law contracts. 
 
 The sum to which these beneficiaries are now entitled is to be found 
 as follows: From $5,000 with interest to August 12, 1904, there is 
 to be deducted (1) the amount of the difference between the assessments 
 due on the $5,000 basis (without interest where tender was made) and 
 the assessments paid with interest from the several dates on which they 
 were paid to August 12, 1904; and (2) the sum already paid to the 
 beneficiaries. i 
 
 Decree accordingly. 
 
 SECTION 3.— PAROL EXONERATION AND RESaSSION 
 
 MARK STEWARD'S CASE. 
 (In the King's Bench, 1586. 4 Leon. 106.) 
 
 An assumpsit before action brought may be discharged by word, 
 otherwise after action brought. 
 
Sec. 3) PAROL EXONERATION AND RESCISSION 949 
 
 CONIERS AND HOLLAND'S CASE, 
 (In the King's Bench, 1588. 2 Leon. 214.) 
 
 In an action upon the case upon assumpsit, by Coniers against 
 Holland, the defendant pleaded, that after the promise, that the 
 plaintiff had discharged him of it: and by Wray, Chief Justice.* It 
 is a good plea, and so it hath been often ruled, and it was late the 
 case of the Lord Chief Baron, against whom in such an action, such 
 a plea was pleaded, and he moved us to declare our opinions in Ser- 
 jeant's-Inn : and there, by the greater opinion, it was holden to be a 
 good plea; for which cause, the Court said to Buckley, who moved 
 the case, that the plea is good, and judgment was entered accordingly. 
 
 EDWARDS V. WEEKS. 
 (In the Common Pleas, 1678. 1 Mod. 262.) i» 
 
 Action upon the case. The plaintiff declares, that the defendant, 
 in consideration that the plaintiff would deliver to him such a horse, 
 promised to deliver to the plaintiff in lieu thereof another horse, or five 
 pounds upon request: and avers, that the plaintiff had delivered to 
 the defendant the said horse, and had requested him, &c. The defend- 
 ant pleads, that the plaintiff, before the action brought, discharged 
 him of that promise, but says not how: to which the plaintiff de- 
 murred. 
 
 Strode, Serjeant. If he had pleaded a discharge before the request 
 made, the plea had been good without shewing how he discharged 
 him: but after the request once made, a verbal discharge is not 
 sufficient ; and he cited the case of Langden v. Stokes, Cro. Car. 384, 
 and the Year Book of 22 Edw. 4, 40 b. 
 
 The Court agreed and gave judgment for the plaintiff, nisi causa, 
 &c." 
 
 EDWARDS v. -CHAPMAN. 
 (In the Court of Exchequer, 1836. 1 Maes. & W. 231.) 
 
 Indebitatus assumpsit, in the sum of £200, for the price and value 
 of goods sold and delivered. 
 
 Plea, as to the price and value of 850 pairs of trimmings, parcel of 
 the said goods in the said declaration mentioned, to wit, the sum of 
 
 " S. c. 2 Mod. 259. 
 
 1^ "A simple contract may, before breach, be waived or discharged, without 
 a deed and without consideration ; but after breach there can be no discharge, 
 except by deed, or upon sufficient consideration." Byles on Bills (13th Ed.) 
 199. 
 
950 DISCHARGE OF CONTEAOT (Ch. 5 
 
 £180. 12s., parcel &c., that the said goods, parcel, &c., were sold 
 and delivered by the plaintiff to the defendant, in pursuance of a 
 certain contract before then made between the plaintiff and the de- 
 fendant; and that afterwards, and before the commencement of 
 the suit, to wit, on &c., it was agreed between the plaintiff and' the 
 defendant that the said contract should be wholly rescinded and an- 
 nulled, and the same was then wholly rescinded and annulled ac- 
 cordingly. Verification. 
 
 General demurrer, and joinder in demurrer. 
 
 Cowling, in support of the demurrer. It is admitted by the plea 
 that the goods were sold and delivejed to the defendant, and have 
 been kept by him, and therefore it is quite immaterial whether the 
 contract has been rescinded or not. 
 
 R. V. Richards, contra. The cause of action arises from the con- 
 tract for the sale of the goods, and not from the delivery of them; 
 and if the parties agree to rescind and annul the contract, which the 
 plaintiff by demurring admits to have been the case, no action can 
 be maintained. 
 
 Parke, B. A duty arises from the contract of sale, which cannot be 
 got rid of without an accord and satisfaction. 
 
 Judgment for the plaintiff.^' 
 
 IT In Foster v. Dawber, 6 Ex. 839 (1851), Baron Parke said: "When the 
 receipt in full was given, It was prima facie evidence against the plaintiff 
 that the amount stated in it was paid. It was not conclusive evidence. 
 * * * Now, it is competent for both parties to an executory contract, by 
 mutual agreement, without any satisfaction, to discharge the obligation of 
 that contract. But an executed contract cannot be discharged except by re- 
 lease under se^l, or by performance of the obligation." 
 
 In Mayor, etc., v. Butler, 3 Lev. 237, (1685), the court said: "It was 
 argued for the defendant, that a promise by parol may be discharged by 
 parol. Cro. Oha. 383, Langden v. Stokes, Cro. Ja. 483, Hartford v. Pile, and 
 Ibid. 160, the opinion of Justice Haughton, Sty. 8, 2 Leon. 214, so here the 
 first promise is discharged by the account, and the promise thereupon. But 
 the whole Court were contrary ; they agreed on a promise merely executory 
 of both parts, as the cases cited before are ; any thing may be discharged by 
 parol ; as if I promise you 5s. if you will go to Paul's,' before you go I may 
 discharge you from the going, and thereby the other shall be discharged from 
 paying the 5s. for no debt was due before the going, nor any thing executed 
 either by the one, or the other ; but in the case at Bar there was a debt 
 due and executed in the plaintiffs, and that could not be discharged without 
 a release." 
 
 See, also, Tacoma Lumber Co. v. Field, 100 Wash. 79, 170 Pac. 360 (1918). 
 
 That a voluntary waiver may be inoperative to discharge a contract duty 
 before breach, and yet may prevent iverformance from continuing to operate 
 as a condition precedent, see Jobst v. Hayden Bros., 84 Neb. 735, 121 N. W. 
 957, 50 L. E. A. (N. S.) 501 (1909) ; Becker v. Becker, 250 111. 117, 95 N. 
 E. 70, Ann. Cas. 1912B, 275 (1911). 
 
Sec. 3) PABOL EXONEBATION AND RESCISSION 951 
 
 GARNSEY V. GARNSEY. 
 (Supreme Judicial Court of Maine, 1917. 116 Me. 295, 101 AH. 447.) 
 
 Haley, J.^* An action of assumpsit on a contract in writing of the 
 following tenor : 
 
 "Sanford, Maine, May 2, 1898. 
 "For value received we jointly, but not severally, promise to pay to 
 our mother, Mary J. Garnsey, annually, during her life, an amount 
 equal to the interest paid by the Kennebec Light & Heat Company on 
 $3,800 face value five per cent, bond, maturing in th^ year 1918. 
 
 "F. A. Garnsey. 
 "A. E. Garnsey." 
 
 The action is brought by Mary J. Garnsey, the promisee named in 
 the contract, against Almon E. Garnsey, one of the signers, and Julia 
 A. Garnsey, administratrix of the estate of Fred A. Garnsey, the other 
 joint promisor. The case is before this court upon report. * * * 
 
 It is the claim of the defendant Julia A. Garnsey administratrix, 
 that the plaintiff has released her as administratrix of her husband 
 from the contract, even if there was a sufficient consideration when 
 given by the two sons to the mother. She testifies : That at one time 
 the plaintiff told her she did not want her to pay the obligation, "didn't 
 expect me to pay ; she didn't need it, and I needn't worry anything 
 about it; she was going to give it to me. She said she was going to 
 give it to Almon ; she was giving it to me ; she intended to use us just 
 alike; that on several times the plaintiff stated that she did not expect 
 her to pay it, and didn't want her to." Upon the other hand, the plain- 
 tiff is positive she never told her she did not expect her to pay any- 
 thing on it and did not want her to, and that she never said any such 
 thing, and that she did expect it. 
 
 The circumstances of the case tend to support the testimony of the 
 plaintiff. But, even if she did say that which Julia A. Garnsey claims 
 she said to her, it was not a release of the estate of Fred A. Garnsey 
 from the obligation that he had signed. It was, at most, if the defend- 
 ant's version is right, a mere verbal promise without consideration and 
 of no binding effect. In order for it to release the estate of Fred A. 
 Garnsey from the contract made and signed by him, it was necessary 
 to be a promise upon a sufficient consideration. There was no consid- 
 eration moving from any one to Mary A. Garnsey to release the estate 
 of Fred A. Garnsey from his contract. A mere statement by a cred- 
 itor that he intends to release, or. that he does release, a debtor, there 
 being no consideration moving from any one for the promise, the debt 
 is not thereby discharged. The debt was created by contract for a 
 sufficient consideration. It can be discharged by contract for a suffi- 
 
 1* Part of the opinion is omitted. There was a sufficient consideration for 
 the promise sued on. ' 
 
952 DISCHARGE OF CONTRACT (Ch. 5 
 
 cient consideration, but a naked promise to release without considera- 
 tion is not a discharge. * * * 
 
 The mandate must be judgment for plaintiff for $190 annually for 
 the years declared upon, with interest at 5 per cent, on the payments 
 when they became due to the date of the writ, and interest on the 
 total from the date of the writ to the date of judgment of the May term. 
 1917, to be cast by the clerk. 
 
 Judgment for plaintiff as per rescript.^" 
 
 GRAY V. BARTON. 
 (Court of Appeals of New York, 1873. 55 N. Y. 68, 14 Am. Rep. 181.) 
 
 This action was brought to recover the balance of an account al- 
 leged to be due from defendant to plaintiff. The facts are sufficiently 
 stated in the opinion. 
 
 Grovbr, J. The judgment cannot be reversed upon the ground of 
 a compromise between the parties. There was some evidence tending 
 to show that the defendant doubted the correctness of the account ren- 
 dered- by the plaintiff, and that for the purpose of satisfying himself 
 asked to examine his books ; and some tending to show that he denied 
 the authority of his wife, by whom the goods had been purchased from 
 the plaintiff, to purchase them upon his credit ; but the referee haying 
 given judgment for the plaintiff, this court cannot assume that either 
 of these facts was found by him. Besides, the evidence, does not show 
 any compromise by the parties either of a demand which was disputed 
 by the defendant, or for the discharge of an admitted indebtedness up- 
 on payment by the defendant of a less sum. The evidence proved, 
 and the referee has found that the defendant being indebted to the 
 plaintiff, he proposed to give him the debt ; that the latter said a gift 
 would not stand in law ; that the plaintiff said if the defendant would 
 
 i»In accord: Pope v. Vajen, 121 Ind. 317, 22 N. E. 308, 6 L. R. A. 688 
 (1889) ; Maness v. Henry, 96 Ala. 454, 11 South. 410 (1892), a loose, oral 
 statement by the creditor; Sigourney v. Sibley, 21 Pick. (Mass.) 101, 32 Am. 
 Dec. 248 (1838), mere determination not to prosecute the claim; Memphis 
 V. Brown, 20 "Wall. 289, 22 L. Ed. 264 (1873), executory accord with conditions 
 unfulfilled; Upper S. J. Canal Co. v. Roach, 78 Cal. 552, 21 Pac. 304 (1889), 
 directors passed a resolution not to sue on the note; Metcalfe v. Kent, 104 
 Iowa, 487, 73 N. W. 1037 (1898) ; Sommers v. Myers, 69 N. J. Law, 24, 54 
 Atl. 812 (1903) ; George v. Lane, 80 K.an. 94, 102 Pac. 55 (1909). Cf. Linthi- 
 cum V. Linihicum, 2 Md. Ch. 21 (1849). 
 
 In Young v. Power, 41 Miss. 197 (1866), a creditor said to her debtor: 
 "Don't put yourself to any trouble about what you owe me ; if I never need 
 it, I will never call on you for it." The creditor died without needing the 
 money, and her executor sued to compel payment and got judgment. The 
 court said: "It appears from the evidence that the declarations of the 
 testatrix, which are relied on as a forgiving of the debt due her by the defend- 
 ant, were altogether gratuitous, and that the promise was without valuable 
 consideration, and that the forgiving, in terms, was not complete and abso- 
 lute, but that some further act was requisite to consummate it. The matter, 
 therefore, rested in her discretion, and depended on her mere volition." 
 
Sec. 3) PAROL EXONERATION AND RESCISSION 953 
 
 give him a dollar that would make it lawful, and then proposed if 
 
 the defendant would give him a dollar he would give him the entire 
 
 debt; whereupon the defendant did give the plaintiff a dollar for the 
 
 purpose of satisfying the whole debt, which the plaintiff accepted, and 
 
 balanced his books as follows: 
 
 Wm. Burton, cr. by cash on account. ...; $ 100 
 
 Crift to balance account 820 91 
 
 And that the plaintiff, for the purpose of carrying out the arrange- 
 ment gave the defendant a receipt, of which the following is a copy : 
 "Received of William Burton one dollar, in full, to balance all book 
 accounts up to date of whatever name and nature." The referee fur- 
 ther found that it was the intention of both parties that the plaintiff, 
 by such. acts so done, should and did give to the defendant the whole of 
 said debt for $1 ; which sum was paid and received for the sole pur- 
 pose of discharging the entire debt. From which facts the referee de- 
 duced the following legal conclusions : That there was no valid com- 
 promise or accord and satisfaction of the debt; that it was not a valid 
 gift in law of the debt from the plaintiff to the defendant; that the 
 plaintiff was entitled to recover of the defendant the amount of the 
 debt less the $1 paid. The only construction of the findings of fact is, 
 that a gift of the entire debt by the plaintiff to the defendant was in- 
 tended to be made, and was made, if the facts were sufficient to consti- 
 tute a legal gift. No compromise of a disputed demand or of an ad- 
 mitted debt, upon payment of less than the amount, was talked of, 
 agreed upon, or at all within the contemplation of the parties. That 
 intention clearly was that the plaintiff should give the entire debt to 
 the defendant, and that he should accept the same as a gift from him. 
 The dollar was given not in payment, but merely to satisfy defendant 
 of its validity. The debt was then due, and the counsel of the respond- 
 ent cites numerous cases where it has been held that a payment of a 
 less sum upon a debt 'actually due cannot satisfy or discharge the entire 
 debt, but only so much as is paid, although agreed to be received in sat- 
 isfaction of the whole. The cases to this effect are uniform from Fitch 
 V. Sutton, 5. East, 230, to Ryan v. Ward, 48 N. Y. 204, 8 Am. Rep. 
 539; Bunge v. Koop, 48 N. Y. 225, 8 Am. Rep. 546. 
 . The reasons upon which these cases were determined were, that it 
 was not good as an accord and satisfaction, as it was obvious that a 
 smaller sum could not satisfy a greater ; that when the debt was due 
 payment of a part by the debtor was no consideration for a promise 
 of the creditor to discharge the residue, as the creditor received nothing 
 to which he was not entitled, and there being no consideration for any 
 such agreement, it was a nude pact and void. To discharge the debt, 
 it was held, that there must be a release under seal. Although the rea- 
 son why the use of a seal would effect a discharge while the same writ- 
 'ing not sealed would not produce such result is rarely alluded to, yet 
 it is perfectly obvious; at common law the seal was conclusive evi- 
 
954 DISCHARGE OF CONTEACT (Ch. 5 
 
 dence of a sufficient consideration, and hence, when attached to a 
 release of a debt, was conclusive of a sufficient consideration therefor. 
 This rule of evidence has been modified by statute to some extent. 2 R. 
 S. 406, § 77. This modification does not extend to releases. The ques- 
 tion in this case is, not whether there was an accord and satisfaction, 
 or a valid compromise of the debt, but whether there was a valid gift 
 of it by the plaintiff to the defendant. Hence the authorities in re- 
 gard to the two former do not apply. 
 
 The counsel for the respondent insists that the defendant cannot 
 avail himself of the latter for the reason that it was not set up in the 
 answer; but no such objection was raised upon the trial. Had it then 
 been taken it might have been obviated by procuring an amendment if 
 necessary. Omitting to make it upon trial was a waiver. The question 
 whether there was a valid gift of the debt upon the facts proved and 
 found is involved in the case and must be determined. A gift may 
 be defined as a voluntary transfer of his property by one to another 
 without any consideration or compensation therefor. To make it valid 
 the transfer must be executed, for the reason that there being no con- 
 sideration therefor no action will lie to enforce it. To consummate 
 a gift there must be such a delivery by the donor to the donee as will 
 place the property within the dominion and control of the latter with 
 intent to transfer the title to him. The question is, was there such a 
 delivery of the debt by the plaintiff to the defendant, or what was 
 equivalent thereto, in this case ? In Champney v. Blanchard, 39 N. Y. 
 Ill, the defendant had in her hands money of the intestate, for which 
 she had given the intestate a receipt. The intestate, on the day of her 
 death, gave this receipt to the defendant, saying in substance she gave 
 the defendant the money therein specified. This was held a valid do- 
 natio causa mortis. A delivery is equally necessary in such a gift as in 
 one inter vivos. True there was, in strictness, no debt from the defend- 
 ant to the intestate. The former held the money as trustee for the 
 latter, but the case is an authority for the position that to constitute a 
 gift a manual delivery of the thing given is not necessary, nor need it 
 be present in all cases ; that a delivery of the evidence of the right of 
 the donor to the donee, with intent to transfer the title, is sufficient. 
 
 In Westerlo v. DeWitt, 36 N. Y. 341, 93 Am. Dec. 517, it was held 
 that the delivery of a certificate of deposit unindorsed, with in- 
 tent to transfer to the donee the money therein specified, was sufficient 
 to constitute a valid gift of such money. It would necessarily follow 
 that the delivery by the donor of the evidence of any debt against a 
 third person, with like intent, would transfer the debt to the donee. In 
 such cases the thing given is the debt, not the evidence ; and yet a de- 
 livery of the latter, with intent to give the former, will effect that re- 
 sult. It would also follow that the delivery by a creditor of a note or 
 bond and mortgage to his debtor, with intent to give him the debt, 
 would be sufficient to transfer and discharge such debt. Kent (2 Com. 
 
Sec. 3) PAROL EXONERATION AND RESCISSION 955 
 
 439), speaking of the delivery essential to a gift, says : that in this as 
 in every other case delivery must be according to the nature of the 
 thing. It must be an actual deUvery, so far as the subject is capable of 
 delivery. It must be secundum subjectam mater iam, and be the true 
 and effectual way of obtaining the command and dominion of the sub- 
 ject. If the thing given be not capable of actual delivery, there must 
 be some act equivalent to it. The donor must part not only with the 
 possession but with the dominion of the property. If the thing given 
 be a chose in action, the law requires an assignment or some equiv- 
 alent instrument, and the transfer must be actually executed. 
 
 The debt in this case consisted of an account for goods sold. Had 
 the plaintiff written upon a copy of the account that the same was can- 
 celed by a gift thereof to the defendant, and signed and delivered the 
 same to the defendant with intent to make a gift thereof to him, and 
 the latter had accepted it as a gift from him, can there be a doubt that 
 the gift would have been effectual? It was all the delivery the subject 
 was capable of. 'But in this case the plaintiff balanced his books by 
 gift to the defendant. Had he stopped here, making no delivery of any 
 thing to the defendant, the act would not have been of any effect; 
 notliing would have been delivered to him; and the books continuing 
 in the, possession of the plaintiff, the gift would not have been execut- 
 ed. But when, to complete his purpose of giving the debt,' he executed 
 and delivered to the defendant a receipt in full for the account, to effect 
 the intention of the parties, the law will construe the instrument, if 
 necessary, as an assignment of the account and of the right of action 
 thereon to the defendant. My conclusion is that the gift of the debt 
 was vaUd, and constituted a defense to the action; that the proof of 
 want of consideration for the receipt given by the plaintiff was an- 
 swered and avoided by the proof that it was given to consummate a gift 
 of the debt by him to the defendant. 
 
 The judgment must be reversed and a new trial ordered, costs to 
 abide the event. 
 
 All concur except Rapallo and FoLGER, JJ., not voting. 
 
 Judgment reversed.'"' 
 
 2»In accord: Ferry v. Stephens, 66 N. Y. 321 (1876) ; Carpenter v. Soule, 
 88 N. Y. 251, 42 Am. Kep. 248 (1882) ; McKenzie v. Harrison, 120 N. Y. 260, 24 
 N. E. 458, 8 L. R. A. 257, 17 Am. St. Rep. 638 (1890) ; Green v. Langdon, 28 
 Mich. 221 (1873) ; Holmes v. Holmes, 129 Mich. 412, 89 N. W. 47, 95 Am. St. 
 Rep. 444 (1902) ; Hathaway v. Lynn, 75 Wis. 186, 43 N. W. 956, 6 L. R. A. 551 
 (1889). See Ferson, "The Rule in Foakes v. Beer" (1921) 31 Yale L. Jour. In 
 Wilson V. Keller, 9 111. App. 347 (1881), the court held a mere oral release in- 
 operative, but said : "A verbal gift is necessarily an execmted contract ; and de- 
 livery of the subject-matter of the gift is of the essence of the title. There 
 must be actual delivery, so far as the subject is capable of delivery. * * * 
 If the thing given be a chose in action, the law requires an assignment, or 
 some equivalent instrument, and the transfer must be actually executed. 
 * * * In the case before us, as the book account was against the appellee- 
 herself, the delivery of a receipted copy of it, or of an acquittance, or possibly a 
 copy of the account not receipted, if the intention to transfer was clearly shown, 
 would be a delivery suited to the subject-matter of the gift ; and probably 
 
956 DISCHARGE OF CONTEACT (Ch. 5) 
 
 KING V. GILLETT. 
 
 (In the Court of Exchequer, 1840. 7 Mees. & W. 55.) 
 
 Assumpsit for the breach of a promise to marry the plaintiff in a 
 reasonable time. The declaration was in the usual form, alleging mu- 
 tual promises to marry. Plea, that after the making of the promise 
 in the declaration mentioned, and before any breach thereof by the 
 defendant, to wit, on, &c., the plaintiff wholly absolved, exonerated, 
 and discharged the defendant from his proniise and the performance 
 of the same. Verification. 
 
 Special demurrer, and joinder therein. 
 
 The following points of argument were stated in the margin: — 
 The plaintiff will contend that a contract founded on mutual promises 
 can only be rescinded before breach by mutual consent; and that a 
 mere discharge by one of the parties, without any act of the other par- 
 ty, is incomplete. The defendant will contend that » promise may be 
 discharged by parol before breach, and that it is not n,ecessary in 
 pleading to state the evidence of such discharge, or the special cir- 
 cumstances under which it arises, or that there was any consideration 
 for the same.^^ 
 
 Aldeeson, B. In this case we are of opinion that the plea is good, 
 and that the demurrer must be overruled. 
 
 The question before the Court was this^ Whether to an action 
 founded on mutual promises to marry within a reasonable time, the de- 
 fendant could plead that, before any breach of contract on his partj. 
 the plaintiff wholly exonerated him from the performance of that con- 
 tract. And it was contended that the proper plea was, that before 
 
 an erasure of the charges from the account book would be regarded as an 
 equivalent act." 
 
 It is generally stated, and has often been held, that an unsealed written re- 
 lease is inoperative; in the absence of a consideration : Mobile R. Co. v. Owen, 
 321 Ala. 505, 25 South. 612 (1899) ; Kidder v. Kidder, 33 Pa. 268 (1859) ; CoUyer 
 V. Moulton, 9 R. I. 90, 98 Am. Rep. 370 (1868) ; Carr v. Bartlett, 72 Me. 120 
 (1881) ; Benson v. Reger, 186 Iowa, 19, 168 N. W. 881, 172 N. W. 166 (1918) . In 
 most cases so stating the rule, the possibility of making a parol executed 
 gift was not being directly considered. Dennett v. Lamson, 30 Me. 223 (1849), 
 an unsealed release does not qualify a witness by extinguishing his interest; 
 Ripley v. Crooker, 47 Me. 370, 74 Am. Dec, 491 (1860), it does not discharge a 
 joint promisor; Reynolds v. Reynolds, 55 Ark. 369, 18 S. W. 377 (1892), 
 part payment not satisfaction ; "there was no gift of the balance due, and 
 it was not so considered or treated" ; Snowden v. Reid, 67 Md. 130, 8 Atl. 
 661, 10 Atl. 175 (1887), where Miller, J., concurred "solely upon the ground 
 that I do not regard the evidence as sufficient to establish a gift of the 
 money in question, and not upon the ground that a creditor cannot make a 
 gift to his debtor of the debt due to him by the latter, except by a delivery up 
 of the note or other instrument evidencing the debt, or by an assignment or 
 release in writing of the debt itself ; Moore v. Maryland Casualty Co., 150 
 N. C. 153, 63 S. E. 675, 24 L. R. A. (N. S.) 211 (1909), no clear intent to make 
 a gift. 
 
 21 Argument of counsel has been omitted and the statement of facts is con- 
 densed. 
 
Sec. 4) PAYMENT OP TENDER THEREOF 957 
 
 breach, the plaintiff and defendant by mutual agreement had rescinded 
 the contract previously made between them. No doubt such a plea 
 would be good ; but on looking into the precedents to which we have 
 been referred, we find that the form of the present plea has been 
 adopted and held good in several cases. There are precedents in sev- 
 eral of the books of entries," and there are two decided authorities, 
 Holland and Conier's case (2 Leon. 214), and Langden v. Stokes 
 (Cro. Car. 383). And we think this latter case explains the matter, 
 and reconciles the present plea with general principles. It seems to 
 have been treated there as a mere question of the form of plea — and so 
 we think it is : for, although we are of opinion that this plea is good 
 in point of form ; yet we think the defendant will not be able to succeed 
 upon it at Nisi Prius, in case issue be taken upon it, unless he proves 
 a proposition to exonerate on the part of the plaintiff, acceded to by 
 himself ; and this in effect will be a rescinding of the contract previous- 
 ly made. 
 
 We think, therefore, that judgment must be given for the defendant ; 
 but the plaintiff should have liberty to amend on payment of costs. 
 
 Leave to amend accordingly."^ 
 
 SECTION 4.^PAYMENT OR TENDER THEREOF 
 
 FLOWER'S CASE. 
 
 (About 1600. Noy, 67.) 
 
 A borrowed one hundred pound of F and at the day brought it in 
 a bagg and cast it upon the table before F and F said to A being his 
 nephew, I will not have it, take it you and carry it home again with 
 
 22 Bast. Entr. 685; Brown's Entr. 67; Hern's Pleader, 31. 
 
 23 Discharge By Exercise of a Power B^^erved. — It is not infrequent that 
 one of the parties to a contract expressly reserves a power of discharging or 
 terminating a contract after a certain period or on certain conditions. His 
 subsequent exercise of this power operates as a discharge, and it is in one 
 sense a discharge by mutual agreement : the power was created by mutual 
 agreement, but its final exercise is a unilateral act, and may, at the time, be 
 very obnoxious to the other party. For examples of this sort of discharge, 
 see Golden Cycle M. Co. v. Bapson C. M. Co., 188 Fed. 179, 112 C. C. A. 95 
 (1911), where "it is agreed that in the event the Mining Company shaU ac- 
 quire a substantial interest in a coal mine as owner * * * then the Min- 
 ing Company may, at its option, declare this contract terminated upon giving 
 the Coal Company 90 days' written notice of its intention to do so"; Wil- 
 mington & Ealeigh E. Co. v. Bobeson, 27 N. O. 391 (1845), ante, p. 719; Bay 
 V. Thompson, 12 Gush. (Mass.) 281, 59 Am. Dec. 187 (1853), ante, p. 717 (sale 
 of chattel with "right of return"), and note appended thereto. See, also, 
 cases cited in the note to Viokrey v. Maier, 164 Cal. 384, 129 Pac. 273 (1913), 
 ante, page 311, holding that the reservation of such a power does not render 
 the contract invalid for lack of consideration. 
 
958 DISCHARGE OF CONTRACT (Ch. 5 
 
 you. And by the Court, that is a good gift by parol!, being cast upon 
 the table. For then it was in the possession of P and A might well 
 wage his law. By the Court, otherwise it had been, if A had only of- 
 fer'd it to F for then it was chose in action onely, and could not be 
 given without a writing.^* 
 
 DIXON V. CLARK et al. 
 (In the Court of Common Pleas, 1847. 5 C. B. 365.) 
 
 Debt, the sum demanded being £26. 
 
 The defendants pleaded that as to part of the demand, to-wit, £5, the 
 plaintiff ought not to recover any. damages because, when that sum 
 became due and before action brought, the defendant had made a ten- 
 der of the i5. 
 
 Replication that at the time the tender was made a larger sum was 
 due, to-wit, il3 15s.; that this was one entire sum and on one entire 
 contract; and that the defendant had refused to pay the whole sum 
 due. 
 
 Demurrer to the replication. Joinder. 
 
 Wilde, C. J.^' * * * 'j^jjg argument involved the general ques- 
 tion, whether a tender of part of an entire debt is good; and several 
 ancient and modern authorities bearing on this question were referred 
 to, but no case directly in point was cited; nor have we been able 
 to find any. On consideration, however, we' are of opinion, upon prin- 
 ciple,' that such a tender is bad, and consequently that the replication is 
 good. 
 
 In actions of debt and assumpsit, the principle of the plea of tender, 
 in our apprehension, is that the defendant has been always ready (tou- 
 
 2* Cf. Cochrane v. Moore (1890) 25 Q. B. Div. 71. 
 . Payment extin^lshes the debt, and it cannot be revived. Marvin v. Ved- 
 der, 5 Cow. N. Y. 671 (1825) ; Lancey v. Clark, 64 N. T. 209 (1876). 
 
 Full performance as required by any legal duty operates to extinguish the 
 duty. 
 
 25 The statement has been rewritten, and part of the opinion has been 
 omitted. 
 
 A tender of money due does not operate as a discharge of a unilateral debt. 
 Town V. Trow, 24 Pick. (Mass.) 168 (1833) ; Cowles v. Marble, 37 Mich. 158 
 (1877) ; Bank v. Davidson, 70 N. C. 118 (1874). To have the limited opera- 
 tion indicated in Dixon v. Clark, supra, the debtor must remain always ready 
 (keep his tender good), and must pay the money into court when sued. 
 Becker v. Boon, 61 N. Y. 317 (1874) ; Werner v. Tuch, 127 N. Y. 217, 27 N. 
 B. 845, 24 Am. St. Rep. 443 (1891). Also the tender must be at the right time 
 and place, in the required form and amount, without requiring the creditor 
 to make change, and the money must be produced and accessible to the 
 creditor. Knight v. Abbott, 30 Vt. 577 (1858) ; Waldron v. Murphy, 40 Mich. 
 668 (1879) ; Noyes v. WyckofC, 114 N. Y. 204, 21 N. B. 158 (1889). 
 
 If a debt is payable in goods, a tender of the goods properly separated and 
 distinguished will discharge the debt, the title to the goods passing to the 
 creditor. Barney v. Bliss, 1 D. Chip. (Vt.) 399, 12 Am. Dec. 696 (1824) ; 
 Hambel v. Tower, 14 Iowa, 530 (1863) ; Dewees v. Lockhart, 1 Tex. 535 
 (1847). 
 
Sec. 5) NOVATION SUBSTITUTED CONTRACT 959 
 
 jours prist) to perform entirely; the contract on which the action is 
 founded ; and that he did perform it, as far as he was able, by tender- 
 ing the requisite money ; the plaintiff himself precluded a complete per- 
 form^ce by refusing to receive it. And, as in ordinary cases the 
 debt is not discharged by such tender and refusal, the plea must not 
 only go on to allege that the defendant is still ready (uncore prist), but 
 must be accompanied by a profert in curiam of the money tendered. 
 If the defendant can maintain this plea, although he will not thereby 
 bar the debt ( for that would be inconsistent with the uncore prist and 
 profert in curiam), yet he will answer the action, in the sense that he 
 will recover judgment for his costs of defense against the plaintiff, — 
 in which respect the plea of tender is essentially different from that 
 of payment of money into court. And, as the plea is thus to con- 
 stitute an answer to the action, it must, we conceive, be deficient in 
 none of the requisite qualities of a good plea in bar. * _* * 
 
 Besides the averment of readiness to perform, the plea must aver 
 an actual performance of the entire contract on the part of the defend- 
 ant, as far as the plaintiff would allow. And it is plain that where by 
 the terms of it the money is to be paid on a future day certain, this 
 branch of the plea can only be satisfied by alleging a tender on the 
 very day. * * * Consequently, a plea by the acceptor of a bill, or 
 the maker of a note, of a tender post diem, is bad, notwithstanding the 
 tender is of the amount of the bill or note, with interest from the day 
 it became due up to the day of the tender, and notwithstanding the 
 plea alleges that the defendant was always ready to pay, not only from 
 the time of the tender, but also from the time when the bill or note be- 
 came payable. On the same reasoning it appears to us that this branch 
 of the plea can only be satisfied by alleging a tender of the whole sum 
 due under the contract, for that a tender of part of it only is no aver- 
 ment that the defendant performed the whole contract as far as the 
 plaintiff would allow. * * 
 
 Judgment for the plaintiff. 
 
 SECTION 5.— NOVATION— SUBSTITUTED CONTRACT 
 
 ROE V. HAUGH. 
 (In the Exchequer Chamber, 1697. 12 Mod. 133.) 
 
 B was indebted to A in the sum of i42, and C in consideration 
 quod A accipere vellet ipsum C fOre debitorem ipsius A pro quad- 
 raginta duob. lib. eidem A per B tunc debit, in vice et loco ejusdem B 
 super se assumpsit, et eidem A promisit quod ipse C easdem quadra- 
 ginta duas lib. eidem A solvere vellet. A dies ; his executors, on this 
 
960 DISCHARGE OF CONTRACT (Ch. 5 
 
 promise, bring an assumpsit against C averring in their count, that 
 
 A, the testator, trusting to the said promise of C accepit prsed. C 
 fore debitorem ipsius A without saying anything that he discharged 
 
 B. Non assumpsit pleaded; verdict and judgment for the pl^ntiff. 
 Writ of error brought in the Exchequer Chamber. 
 
 The error insisted on was that this is a void assumpsit, here being 
 no good consideration, for except B was discharged, C could not be 
 chargeable. 
 
 For which reason BlEncowE, Powell, and Ward were of opinion 
 judgment should be reversed, but Powis, NEvill, LechmErS, and 
 Treey that this being after verdict, they should do what they could to 
 help it ; to which end they would not consider it only as a promise on 
 the part of C, for as such it would not bind him except B was dis- 
 charged; but they would construe it to be a mutual promise — ^viz., 
 that C promised to A to pay the debt of B and A on the other side 
 promised to discharge B, so that though B be not actually discharged, 
 yet if A sues him, he subjects himself to ah action for the breach of 
 his promise. 
 
 The judgment was affirmed. 
 
 KLINKOOSTEN v. MUNDT. 
 
 (Supreme Court of South Dakota, 1916. 36 S. D. 595, 156 N. W. 85. L. B. 
 
 A. 1918B, 111.) 
 
 Action by Jacob Klinkoosten against William J. Mundt. From an 
 order overruling plaintiff's motion for directed verdict, and from a 
 judgment for defendant, plaintiff appeals. Reversed and remanded. 
 
 McCoy, J. Plaintiff, as assignee of the original payee, brought this 
 suit against defendant to recover upon a negotiable promissory note 
 for $25 executed and delivered by defendant to the Unitype Company. 
 There was judgment in favor of plaintiff in the justice court,' from 
 which defendant appealed to the circuit court. In circuit court there 
 was a verdict and judgment in favor of defendant. At the close of all 
 the evidence plaintiff moved the court for a directed verdict in favor of 
 plaintiff, on the ground that the undisputed testimony shows that plain- 
 tiff purchased the note in due course in good faith, in the ordinary 
 course of business for value before maturity, and that the undisputed 
 evidence, shows no defense, in that it does not show a release or nova- 
 tion. The motion was denied, to which ruling plaintiff excepted. 
 Plaintiff now assigns such ruling as error. 
 
 Defendant admitted the execution of the note. The defendant plead- 
 ed as a defense that prior to the transfer of said note to plaintiff the 
 Unitype Company released defendant from the payment of said note 
 and agreed in writing to accept as payor in lieu of defendant the 
 Messenger Publishing Company. It appears from the evidence that at 
 the time of the execution of said note defendant was the proprietor 
 
Sec. 5) NOVATION SUBSTITUTED CONTRACT 961 
 
 of a printing and publishing business, and purchased certajn printing 
 machinery from the Unitype Company, and gave 46 notes, amounting 
 to $1,450 in consideration of the purchase price of said machinery, the 
 note in question being one of such notes. Under the contract for the 
 purchase of said machinery it was provided that the title to such ma- 
 chinery should remain in the Unitype Company until the full pay- 
 ment of said notes. After the making of this contract, and before the 
 maturity of said note, defendant sold and transferred his printing and 
 publishing business and said machinery to the Messenger Publishing 
 Company. About the time this sale and transfer were made to the 
 Messenger Company, defendant wrote the Unitype Company that he 
 had made such sale ; that the Messenger Company had agreed to make 
 new notes for those remaining unpaid for such machinery, and would 
 assume the entire obligation of defendant, provided the Unitype Com- 
 pany would consent to take their notes. The Messenger Company also 
 wrote the Unitype Company in substance as follows: We have pur- 
 chased the interest of Mundt in his contract under which the Unitype 
 typesetting machine was installed. We, therefore, assume the rights 
 and obligations of Mundt in the contract, and agree to pay the unpaid 
 notes given by him, and carry out all his obligations under the terms 
 of the agreement. It is agreed between Mundt and the Messenger 
 Company that on completion of the payment of the balance of these 
 notes and the carrying out in full of the terms of the agreement, you 
 are to issue a bill of sale for said machinery to the Messenger Publish- 
 ing Company. 
 
 This letter was signed by the Messenger Publishing Company by its 
 president, and at the bottom thereof, over the signature of defendant, 
 appeared the following: "The Unitype Company is hereby authorized 
 to issue a bill of sale to the Messenger Publishing Co. for the above- 
 described machine when all the terms of the contract have been fully 
 met and all the notes given under the same duly paid." Also on the 
 bottom of this "letter appears the follov/ing: "Accepted. The Unitype 
 Co., by E. J. Andrews, Treas." 
 
 The note in question was never paid. The Messenger Publishing 
 Company never executed and delivered to the Unitype Company its 
 notes in place of the notes given by defendant. In order to constitute 
 novation, there must be either an express or implied agreement on the 
 part of the creditor to substitute the new debtor in place of the orig- 
 inal debtor, and also an express or implied agreement to release and 
 discharge the original debtor. Kelso v. Fleming, 104 Ind. 180, 3 N. 
 E. 830; Carpy v. Dowdell, 131 Cal. 495, 63 Pac. 778; Dempsey v. 
 Pforzheimer, 86 Mich. 652, 49 N. W. 465, 13 E. R. A. 388; Cornwell 
 V. Megins, 39 Minn. 407, 40 N. W. 610; Piehl v. Piehl, 138 Mich. 
 515, 101 N. W. 628; Hanson v. Nelson, 82 Minn. 220, 84 N. W 742; 
 Eowe V. Blum, 4 Okl. 260, 43 Pac. 1063 ; Roberts v. Samson, 50 Neb. 
 745, 70 N. W. 384; Page, Contracts, 958; 29 Cyc. 1132. 
 
 COKBIN OONT 61 
 
962 DISCHARGE OF CONTRACT (Ch. 5 
 
 All that the Unitype Company ever assented to, as shown by the 
 correspondence, was that the Messenger Publishing Company might 
 assume the rights and obligations of defendant under the contract and 
 make payment of the notes given by defendant, and when said notes 
 had all been fully paid and satisfied, it would transfer title to the 
 machinery to the Messenger Publishing Company. There was no as- 
 sent or agreement, either express or implied, that the Messenger Com- 
 pany be substituted in place of defendant as a debtor to the Unitype 
 Company. There was no assent or agreement, either express or im- 
 plied, to discharge or release defendant. In most of the adjudicated 
 cases where it has been held that implied novation had occurred there 
 were circumstances such as the delivery to the original debtor of his 
 notes arid new notes taken in place thereof, or other circumstances, in- 
 dicating an intention on the part of the creditor to accept the new 
 debtor in place of the old, and to release and discharge the obliga- 
 tion as against the original debtor. No circumstances of that charac- 
 ter appear in this case. We are of the view that the court erred in 
 overruling the motion to direct a verdict for plaintiff; no defense of 
 release by novation having been shown. 
 
 The judgment and order appealed from are reversed, and the cause 
 remanded.^® 
 
 Smith, J. (concurring). ^^ * * * ^ contract of novation is ef- 
 fective between the original creditor and the new debtor. The' orig- 
 inal debtor, if sued upon the original obligation, may plead a valid con- 
 tract of novation as an accord and satisfaction of his indebtedness. If 
 a valid contract of novation is not proved, the defense of accord and 
 satisfaction fails. 
 
 2' There is no novation, unless the original debtor is discharged. A mere 
 assent by the creditor to the assignment of the contract by the original debtor, 
 where such debtor had rights as well as duties, does not operate as a dis- 
 charge. Liversidge v. Broadbent, 4 H. & N. 603 (1859) ; Mills- v. McMillan, 
 78 Fla. 294, 82 South. 812 (1919) ; Corinth S. ^ S. Turnpike Co. v. Gooch, 
 113 Miss. 50, 73 South. 869 (1917) ; Staples v. Davis, 75 N. H. 383, 74 AU. 
 872 (1909). 
 
 An assignment of a contract, becomes a novation, where the assignee has 
 agreed to undertake the duties as a substitute for the assignor, and the 
 other party has agreed to such substitution, not only in the matter of per- 
 formance as a fact, but also in respect to the legal duty to perform. See 
 Robinson v. Eispin, 33 Cal. App. 536, 165 Pac. 979 (1917) ; Manor v. Dun- 
 field, 33 Cal. App. 557, 165 Pac. 983 (1917). The assent of the creditor to 
 this substitution can be shown by implication from conduct and circumstances, 
 as well as by express words, and some courts appear to be liberal in drawing 
 the inference. See Gillett v. Ivory, 173 Mich. 444, 139 N. W. 53 (1912) ; T. 
 W. Stevenson Co. v. Peterson, 163 Wis. 258, 157 N. W. 750, L. R. A. 1918B, 
 105 (1916). 
 
 27 Part of the concurring opinion of Smith, J., is omitted. 
 
Sec. 5) • NOVATION — SUBSTITUTED CONTRACT 963 
 
 SMART V. TETHERLY. 
 (Supreme Court of New Hampshire, 1878. 58 N. H. 310.) 
 
 Assumpsit, for goods sold and delivered. H. owed the plaintiff a 
 balance of $100 on a bill of lumber. The defendant owed H. more than 
 that sum for labor. H. gave the plaintiff an order for that amount on 
 the defendant, and it was mutually agreed by the three parties that the 
 defendant should pay the plaintiff the amount of the order, and apply 
 that sum on his indebtedness to H. The plaintiff was allowed to amend 
 his declaration by adding a special count on the defendant's acceptance 
 of the order, and the defendant excepted. The cause was tried on the 
 amended count, and the plaintiff had a verdict. 
 
 AnEN, J. An amendment which changes the cause of action, or in- 
 troduces a cause of action entirely new and different from that stated 
 in the original declaration, is not allowed. Butterfield v. Harvell, 3 
 N. H. 202; Goddard v. Perkins, 9 N. H. 488; Stevenson v. Mudgett, 
 10 N. H. 340, 34 Am. Dec. 155; Melvin v. Smith, 12 N. H. 462; 
 Moses V. Boston & M. R. R., 32 N. H. 524, 534; Wood v. Fol- 
 som, 42 N. H. 70. The original declaration was for goods sold and de- 
 livered. The ajmendment proposed was a new count, on the acceptance 
 of an order by the defendant given to the plaintiff by a third person, 
 H. If the defendant accepted the order, and the plaintiff took him 
 .instead of H. as a debtor, the defendant's debt to H. and H.'s debt 
 to the plaintiff for that amount were extinguished, and a new liability 
 of the defendant to the plaintiff was created. The mutual agreement 
 of the three parties was a novation. ,It was not an agreement of the 
 defendant to pay for the lumber which the plaintiff had sold to H., 
 but an agreement to pay a specific sum to the plaintiff in consideration 
 of the discharge of a like amount of his indebtedness to H. Heaton 
 V. Angier, 7 N. H. 397, 28 Am. Dec. 353 ; Tatlock v. Harris, 3 T. R. 
 174; Butterfield v. Hartshorn, 7 N. H. 345, 26 Am. Dec. 741; 
 1 Pars. Cont. 220, 221. The plaintiff cannot treat his claim as an as- 
 signment, merely, of H.'s claim -against the defendant, and as security 
 for his own claim against H., for in that case he could only sue in 
 the name of H. 
 
 The proposed amendment introduced a new cause of action, de- 
 stroyed the identity of the original cause, and must be disallowed. 
 Verdict set aside.^* 
 
 !>« Substituted Creditor. — An assignment of his right by a creditor with 
 notice to the debtor now operates as a practically complete substitution of 
 creditors, even without the debtor's consent. See chapter on Assignment. By 
 the earlier law it did not so operate ; but an assent to the assignment given 
 for a consideration moving from the assignee would operate as a novation. 
 See Wilson v. Coupland, 5 B. & Aid. 228 (1821) ; Wharton v. Walker, 4 B. 
 & C. 163 (1825). 
 
964 DISCHAEGE OP CONTRACT (Ch. 5 
 
 PERRY & WALDEN v. GALLAGHER. 
 (Court of Appeals' of Alabama, 1919. 82 South. 562.) 
 
 Assumpsit by J. L,. Gallagher agaiflst Perty & Walden. Judgment 
 for plaintiff, and defendants appeal. Affirmed. 
 
 Count 4 of the complaint is as follows : 
 
 Plaintiff claims of the defendants the further sum of $32.50 for 
 that on, to wit, December 1, 19 14, the defendants promised to furnish 
 plaintiff with lumber to the value of $32.50, and that one Coleman 
 Gann was indebted to plaintiff in the sum of $32.50, and said defend- 
 ants stated to plaintiff that they were indebted to Gann and that they 
 would deliver to plaintiff said lumber; and plaintiff, in pursuance of 
 said agreement, discharged said Gann from his said indebtedness, with 
 the consent of said Gann, but the defendants failed then or refused to 
 comply with said agreement and to deliver said lumber to plaintiff; 
 and this relates to the same transaction as counts 1, 2, and 3, and plain- 
 tiff claims interest on said claim. 
 
 SAMifORD, J. The fourth count of the complaint, upon which the 
 cause was tried, sets up a novation, and the insistence of appellant is 
 that the complaint is subject to demurrer for the reason that it fails to 
 allege that the defendants were indebted to the original debtor of plain- 
 tiff, and whom it is alleged the plaintiff discharged from further lia- 
 bility to him upon the express agreement of defendants to pay plaintiff 
 the amount due, representing to plaintiff at the same time that they (the 
 defendants) were indebted to plaintiff's original debtor in the amount 
 which they were agreeing to pay. The complaint alleged' a previous 
 valid indebtedness due from the original debtor to plaintiff, an agree- 
 ment of all the parties to the new contract or obligation, an agreement 
 that it was an extinguishment of the old contract or obligation, and 
 a new contract or obligation binding between the parties thereto. It 
 was not necessary to allege a consideration passing to the deferidants 
 other than the release by plaintiff, at the instance of defendants, of 
 the claim which he held against the original debtor. This was not a 
 promise of the defendants to answer for the debt, default, or miscar- 
 riage of another, but was an original undertaking by them, where, on 
 account of their promise, the plaintiff released the claim which he had 
 theretofore held. The complaint was not subject to demurrer inter- 
 posed. Perry & Walden v. Gallagher, 200 Ala. 68, 75 South. 396,- 
 Hopkins v. Jordan (Sup.) "ll South. 710; McDonnell v. Ala. Gold 
 Life, 85 Ala. 414, 5 South. 120; 20 R. C. L. pp. 367, 368, § 10; Un- 
 derwood V. Lovelace, 61 Ala. 155 ; Howard v. Rhodes (App.) 81 South. 
 362. 
 
 As has already been seen, it was not necessary to a novation that the • 
 defendants should have been actually indebted to plaintiff's original 
 debtor, and therefore the court was not in error in giving the several 
 charges in line with the excerpt from his oral charge as requested by 
 
Sec. 5) NOVATION SUBSTITUTED CONTRACT 965 
 
 plaintiff, and in refusing charges requested by defendants, asserting 
 contra propositions, to wit: 
 
 "If Perry & Walden accepted the order given to Gallagher by Gann 
 and agreed to pay it in lumber, and that Gallagher released Gann and 
 took the debt on Perry & Walden, it would not be material whether or 
 not Perry & Walden owed Gann." 
 
 "An essential element of every novation is a new contract to which 
 all the parties agree." 20 R. C. L. p. 367. 
 
 If the agreement is had, it can make no difference that it was not 
 perfected at the same moment between all of the parties, or that alJ 
 were not present at the time. McLaren v. Hutchinson, 22 Cal. 187, 
 83 Am. Dec. 59. It is therefore essential in this case, in order to es- 
 tablish the plaintiff's contentions, that the evidence should show an 
 agreement of all the parties to the terms of the new contract. This, 
 however, was a question for the jury, and there was sufficient evidence 
 upon which to base this finding. The refusal to give the general 
 charge at the request of the defendant was not error. 
 
 The ruling of the court on the motion for a new trial, on the ground 
 that the verdict of the jury is contrary to the evidence, will not be 
 disturbed. 
 
 We find no error in the record, and the judgment is affirmed. 
 
 Affirmed.^' 
 
 TAYLOR V. HILARY. 
 
 (In the Court of Exchequer, 1835. 1 Cromp., M. & R. 741.) 
 
 Assumpsit. The declaration stated, that in consideration that the 
 plaintiff, at the special instance and request of the defendant, would 
 allow one Henry Holt to have goods as he might want them, not ex- 
 ceeding in the whole £200, the defendant undertook and promised 
 the plaintiff to guarantee the payment of such 'goods; and the plaintiff 
 averred that he, confiding &c., did afterwards, to-wit &c., sell and de- 
 liver to the said Henry Holt certain goods of great value, not exceeding 
 in the whole i200, to-wit, of the value of £190, as he the said Henry 
 Holt did want them; of which the defendant afterwards, tb-wit, 
 on &c., had notice. Breach, that Henry Holt had not paid for the 
 said goods, or any part thereof, nor had the defendant, although 
 often requested, paid for the same, or any part thereof. Plea, that 
 after the making of the promise and undertaking in that count men- 
 tioned, and before any breach thereof, to-wit, on the day and year 
 aforesaid, it was, at the special instance and request of the plaintiff, 
 
 ==» In accord : Corbett v. Cochran, 3 Hill (S. C.) 41, 30 Am. Dee. 348 (1836) ; 
 Gleason v. Fitzgerald, 105 Mich. 516, 63 N. W. 512 (1895) ; cf. Fairlie v. Den- 
 ton, 8 B. &C. 395 (1828). 
 
 Where one partner retires and a creditor accepts the remaining partner a.s 
 sole debtor, there is a novation. Lyth v. Ault, 7 Ex. (W. H. & G.) 669 (1852). 
 
966 DISCHAEGB OF CONTRACT (Ch. 5 
 
 agreed by and between the plaintiff and defendant that the plaintiff 
 should supply to the said Henry Holt £200 worth of goods as he 
 should want them, and that such goods should be paid for at the end 
 of three months by a joint bill at four months accepted by the defend- 
 ant; which agreement of the defendant he the plaintiff, before any 
 breach of the promise and undertaking in the said count mentioned, 
 accepted, in full discharge of tljat promise and undertaking, and there- 
 by then wholly released and discharged the defendant from the further 
 performance of that promise and undertaking. Verification. 
 
 To this plea the plaintiff demurred ; and alleged as cause of demur- 
 rer', that there was no material difference between the agreement set out 
 in the count and that set out in the plea, and that the only difference 
 applied to the time of credit to be given; and that it did not appear 
 by the said plea, "but that the agreement therein mentioned had been 
 fully carried into effect by the plaintiff, and the time of credit expired. 
 
 PBR Curiam.'" Before the breach of the first agreement a new 
 agreement is entered into, varying the contract in an essential part, the 
 time of payment. The latter, then, is a substituted contract^ and is 
 ail answer to an action upon the former. The plea is not a plea of 
 accord and satisfaction, and does not therefore require an avcment of 
 performance.'^ 
 
 BANDMAN v. FINN. 
 
 (Court of Appeals of New York, 1906. 185 N. T. 508, 78 N. E. 175, 12 L. E. 
 
 A. [N. S.] 1134.) 
 
 Action by Albert Bandman against William E. Finn. From an 
 order of the Appellate Division, First Department (103 App. Div. 322, 
 92 N. Y. Supp. 1096), sustaining exceptions to the direction of a ver- 
 dict at Trial Term and ordering a new trial, defendant appeals. Re- 
 versed, and judgment directed to be entered on directed verdict. 
 
 CuivLEN, C. J. On May J4, 1902, the defendant became the pur- 
 chaser from the executors of Henry Hilton of certain premises on 
 
 '" The argument of counsel, and certain remarks by Parke, B., during such 
 argument, have been omitted. 
 
 "iln accord: McCreery v. Day, 119 N. Y. 1, 23 N. E. 198, 6 L. R. A. 503, 
 16 Am St. Rep. 793 (1890) ; McNish v. Reynolds, etc., Co., 95 Pac. 483 (1880) ; 
 Smith V. Kelley, Maus & Co., 115 Mich. 411, 73 N. W. 385 (1897) ; Montgomery 
 V. American Cent. Ins. Co., 108 Wis. 146, 84 N. W. 175 (1900) ; Youngberg 
 V. South End Warehouse Co., 177 Cal. 504, 171 Pac. 97 (1918) ; Poteet v. 
 Imboden, 77 W. Va. 570, 88 S. E. 1024 (1916) ; Long v. Shepherd, 159 Ala. 595, 
 48 South. 675 (1909), the parol alteration is valid, even though the written 
 contract expressly provides that it cannot be altered except by a writing. 
 
 Whether before or after breach, if there are mutual existing duties as yet 
 unperformed, a mutual agreement to discharge is valid. Cutter v. Cochrane, 
 116 Mass. 408 (1874) ; Kellett v. Robie, 99 Wis. 303, 74 N. W. 781 (1898) ; 
 Dreifus Co. v. Columbian Exposition Salvage Co., 194 Pa. 475, 45 Atl. 370, 75 
 Am. St. Rep. 704 (1900) ; Prye v. Kalbaugh, 34 Utah, 306, 97 Pac. 331 (1908) ; 
 Spier V. Hyde, 78 App. Div. 151, 79 N. Y. Supp. 699 (1903). 
 
Sec. 5) NOVATION SUBSTITUTED CONTKAOT 967 
 
 Broadway and Lafayette Place, in the city of New York. Out of the 
 negotiations leading to that sale, in the procurement of which the plain- 
 tiff's assignor, one Schmidt, had acted as broker, the defendant exe- 
 cuted and delivered to said Schmidt the following agreement: "I, 
 William E. Finn, in consideration of H. Schmidt executing a release 
 of claim for commission to Horace Russell and Edward D. Harris, as 
 executors, etc., do hereby agree to pay to said H. Schmidt one thou- 
 sand dollars on passing of title 726-730' Broadway and 31-39 Lafay- 
 ette Place, which closing has been set down for May 15, 1902, and to 
 further pay him the additional sum of $8,600 on completion of roof of 
 contemplated building on said premises. In the event of a sale of 
 these premises, I agree to pay H. Schmidt said Eighty-six hundred 
 dollars on consummation of said sale. William E. Finn. Witness: 
 Charles A. Stahl." In October, 1903, no building having been erect- 
 ed on the premises and the defendant not having sold the same, 
 Schmidt retained a lawyer, Mr. Levy, to negotiate with the defendant 
 for a satisfaction and surrender of the obligation. Finally the nego- 
 tiations terminated on Monday before Thanksgiving Day, during that 
 year, in an oral agreement whereby the defendant promised to pay 
 Schmidt the sum of $2,500 on the Wednesday following, and Schmidt 
 agreed to execute to the defendant a' release of all his claims and to 
 surrender to him the agreement. The parties met at the time and 
 place appointed, and the defendant offered to carry out the contract. 
 Schmidt had not with him the written agreement which was to be sur- 
 rendered. On the defendant requiring the production of the agree- 
 ment, Schmidt went away with the ostensible purpose of procuring it. 
 He never returne'd, but refused to carry out the contract. Thereafter 
 the defendant sold the premises, and after the consummation of that 
 sale, Schmidt having assigned his contract, the assignee brought this 
 suit. At the conclusion of the' evidence, each party requested the 
 court to direct a verdict, the plaintiff for the full amount claimed in 
 the agreement and the defendant for the sum which he had agreed to 
 pay therefor. Neither party requested the submission of the cause 
 to the jury. The court directed a verdict for the plaintiff for the sum 
 of $2,500, and ordered the plaintiff's exceptions to be heard in the 
 first instance by the Appellate Division. That court sustained the 
 exceptions and ordered a new trial. From that order an appeal has 
 been taken to this court. Neither party having asked to go to the jury, 
 the determination of any question of fact was necessarily submitted to 
 the trial court. The case having been before the Appellate Division 
 only on the exceptions taken on the trial, all the facts and inferences 
 therefrom must be assumed to have be.on found in the defendant's fa- 
 vor, and the Appellate Division could not sustain the exceptions unless 
 in no view of the evidence could a jurj' have found in the defendant's 
 favor. 
 
 The testimony in the case tended to show — we may say conclusively 
 showed, for it was uncontradicted— that on Monday there was effected 
 
968 , DISCHARGE OF CONTRACT (Ch. 5' 
 
 a corBplete oral agreement by which, on the Wednesday following, the 
 defendant was to pay Schmidt $2,500, and Schmidt was to surrender 
 the agreement and release his claim. This was not the mere act of the 
 lawyer, but Schmidt was informed of the proposed agreement in de- 
 tail, accepted it, and the defendant was notified of such acceptance. 
 No objection was raised at the trial, nor is it made on this appeal, that 
 the agreement was invalid under the statute of frauds, because not in 
 writing, and therefore that question is not before us ; but the plaintiff 
 insisted that the case is one of accord and satisfaction, and till exe- 
 cuted had no binding force, and either party was at liberty to with- 
 draw from it. This was the view entertained by the Appellate Division 
 in setting aside the verdict; the learned trial court having directed 
 the verdict on the ground that the new contract entered into between 
 the parties operated as a novation and discharged the liabilities under 
 the old contract. I am of opinion that the trial court was correct. 
 Doubtless the general rule is that an executory agreement for accord 
 without satisfaction made under it does not bar a cause of action, and 
 that tender of performance is insufficient for that purpose. Ryan v. 
 Ward, 48 N. Y..204, 8 Am. Rep. 539; Kromer v. Heim, 75 N. Y. 574, 
 31 Am. Rep. 491. It is also the rule that payment of a less sum than 
 that due does not constitute a valid satisfaction, although otherwise if 
 the debtor gives the creditor additional security. Jaffray v. Davis, 124 
 N. Y. 164, 26 N. E. 351, 11 L. R. A. 710. 
 
 These rules, however, do not apply to the present case. At the time 
 of the agreement between the parties in November, 1903, there had 
 been no breach of the written contract with the defendant. Under 
 that contract he was obligated to pay only in one of two contingencies, 
 on the completion of the roof of the contemplated building on such 
 premises, or in case of a sale of the same by the defendant. Neither 
 of these contingencies had occurred. Therefore the situation was 
 that of a creditor holding an unmatured and contingent obligation, 
 agreeing with his debtor for the surrender of the obligation. Even in 
 tlie case of a claim unmatured, but not contingent, the payment and 
 receipt of a less sum than that specified is a full satisfaction of the 
 larger claims not yet due. Brooks v. White, 2 Mete. (Mass'.) 283, 37 
 Am. Dec. 95; Bowker v. Childs, 3 Allen (Mass.) 434. As is said in 
 the cases, it may be much more advantageous to the creditor to obtain 
 the money before it is due, and this is sufficient consideration for re- 
 ceiving a smaller sum. So, also, it has been held that an executory 
 agreement for such a surrender or compromise will be enforced. In 
 Fertilizer Co. v. Dunan, 91 Md. 144, 46 Atl. 347, 50 L. R. A. 401, 
 the defendant was indebted to the plaintiff in a sum for the payment 
 of which at a future date he executed his written agreement, and as 
 collateral security for the payment of the obligation he delivered cer- 
 tain stock and promissory notes of third parties. Before the maturity 
 of his obligation he entered into an oral agreement with the plaintiff 
 by which he agreed to pay it immediately a less sum than that owing by 
 
Sec. 5) NOVATION SUBSTITUTED CONTRACT 969 
 
 him, and the plaintiff agreed on such paymeiit to cancel the obligation 
 and surrender the collateral. It was held that the earlier date of pay- 
 ment was sufficient consideration for the agreement on the part of the 
 plaintiff and that the agreement would be enforced. It was there said : 
 "The actual payment of the amount agreed to be paid by Dunan 
 would have constituted a good accord and satisfaction if the collateral 
 consideration relied on was sufficient to support the agreement; but 
 the question is, not whether there has been an accord and satisfaction, 
 but whether there was a valid consideration for the agreement of De- 
 cember 3d and Sth, and, if there was, whether the failure of the credi- 
 tor to perform his part of that agreement by refusing to accept the 
 money precludes a court of equity from enforcing it." In the present 
 case the original agreement between the parties, though witnessed, was 
 not under seal, and hence we are not embarrassed with the technical 
 rule that an agreement under seal can be modified only by an instru- 
 ment of a similar character. The plaintiff's assignor having at the time 
 of the second agreement no cause of action against the defendant, I 
 do not see why he could not enter into a valid agreement with the de- 
 fendant for the transfer and surrender of the latter's obligation to the 
 same extent as he might have done with any third party. 
 
 The learned counsel for the respondent insists that what the plain- 
 tiff's assignor negotiated for was, not the surrender of an unmatured 
 obligation, but the satisfaction of an existing claim, and that therefore 
 the rules as to accord and satisfaction applied. Assuming that 
 Schmidt urged that the claim was due, to this the defendant did not 
 assent. On the contrary, the defendant's position was that there was 
 no existing liability on the contract, and he required as a condition of 
 the settlement not only a release O'f any claim but the surrender of the 
 contract. The counsel also suggests there might have been such delay 
 in the construction of the building on the premises as to render the de- 
 fendant liable, even though the roof of the building was not completed. 
 To this it is sufficient answer that no such ikct was pleaded in the 
 complaint nor any proof of it given on the trial. The real nature of 
 the transaction must therefore be determined on the record before 
 us, regardless of the conflicting claims of the parties, and on that rec- 
 ord it appears that no default had been made by the defendant when 
 the second agreement was made. Therefore the plaintiff had no cause 
 of action at that time, and the principles of accord and satisfaction 
 have no application. 
 
 It is further to be observed that in the aspect most favorable to the 
 plaintiff tlae claim at the time of the agreement for the surrender of 
 the contract was a disputed one.' The contention of the defendant 
 that it was not due was not only made in good faith, butj as we have 
 said, was well taken. The rules as to accord and satisfaction do not 
 obtain in their entirely in the compromise of disputed claims. Thus 
 the pa3mient of a l;,ess sum than that claimed or , actually owing is a 
 good satisfaction, if the dispute is bona fide. Fuller v. Kemp, 138 N. 
 
* 
 
 970 DISCHARGE OF CONTRACT (Ch. 5 
 
 Y. 231, 33 N. E. 1034, 20 L. R. A. 785; Nassoiy v. Tomlinson, 148 
 N. Y. 326, 42 N. E. 715, 51 Am. St. Rep. 695. On the other hand, if a 
 defendant gives his note or mortgage in settlement of the demand, he 
 cannot defend on the ground that there was no liability on his part, 
 or, if liable, it was for a less amount. Stewart v. Ahrenfeldt, 4 Denio , 
 189; Feeter v. Weber, 78 N. Y. 334. Nor does the rule that an exec- 
 utory agreement for accord, until performed, does not constitute a de- 
 fense, which always obtains in the case of a conceded debt (Kromer v. 
 Heim, 75 N. Y. 574, 31 Am. Rep. 491), equally apply to an agree- 
 ment or compromise of a disputed claim. In most of the cases in the 
 reports the debtor had given his promissory note or some security for 
 the amount agreed upon. I appreciate that these cases may be dis- 
 tinguished from the one before us, because it may be said that the note 
 or security was itself an execution of the accord. But there are at 
 least two cases in this court in which that distinction cannot be 
 drawn. ^^ * ^ * 
 
 The ground, therefore, on which the decisions in the Wehrum and 
 Dunham Cases proceeded, is that there may be a valid executory 
 agreement to compromise a disputed claim, which, though unexecuted, 
 is binding on the parties and determines their rights. The distinction 
 between the two classes of cases is well illustrated in Flegal v. Hoover, 
 156' Pa. 276, 27 Atl. 162. There the Supreme Court of Pennsylvania 
 said : "This case was unfortunately tried on a wrong basis throughout. 
 It was assumed that the agreement of May, 1892, was an accord, and as 
 its terms had not been fully carried out, that there had been no satis- 
 faction, that the agreement was, therefore, inoperative, and the par- 
 ties were remitted to their rights and liabilities under the original 
 contract. This was a radical error. The agreement of May, 1892, was 
 a compromise of disputed rights. The defendants claimed that the 
 plaintiff was violating the contract in such manner as to entitle them 
 to rescind, and they had in fact taken possession of the land a short 
 time before by force. The plaintiff, on the other hand, claimed that 
 he was pursuing his contract rights, and he had in turn ousted the 
 defendants by force from the land. The parties then came together, 
 agreed upon a settlement, put its terms in writing, which was signed 
 by both, and partly carried out. Such an agreement is not an accord, 
 but a compromise, and is as binding as any other contract." The agree- 
 ment in the present case was not tentative, but specific and final. The 
 defendant agreed to pay, and the plaintiff agreed to receive, a specific 
 sum at a specified time and place. Had the defendant defaulted in the 
 performance of his agreement, the plaintiff's assignor could have sued 
 on his promise, regardless of the merits of the claim under the original 
 contract. Equally the defendant may hold the plaintiff's assignor to 
 the agreement. 
 
 ,82 The court here discussed Wehrum v. Kuhn, 61 N. T. 623 (1874), and 
 Dunham, v. GriswoldjlOO N. Y. 224, 3 N. E. 76 (1885). • 
 
Sec. 5) NOVATION SUBSTITUTED CONTRACT • 971 
 
 The order of the Appellate Dmsion should be reversed, the plain- 
 tiff's exceptions overruled, and judgment directed to be entered on 
 the directed verdict at the Trial Term; with costs to the appellant in 
 both courts. 
 
 Haight, J. (dissenting).^' * * * ']^he question presented , upon 
 this review is as to whether the negotiations for a settlement that 
 had taken place between plaintiff and the defendant had ripened ihtb 
 a completed contract, so that a novation had taken place and the new 
 contract substituted for the old, or whether the negotiations had pro- 
 ceeded to the extent only that their minds had met upon the terms with 
 the understanding that the settlement by the payment of the money and 
 the delivery of the release was to take place on a future day; in other 
 words, that there was an accord executory without satisfaction. I 
 think the undisputed evidence in this case, even adopting the most 
 favorable view that can be taken thereof for the defendant, brings 
 it within the latter rule of an accord executory — a meeting of the 
 minds of the parties upon the terms, with the satisfaction or payment 
 postponed until a future time. The defendant had offered Schmidt 
 $2,500 for his claim under the contract. Schmidt had said that he 
 would accept it, and the defendant was to pay over the $2,500, and 
 Schmidt was to execute and deliver a release of his claim on the 
 Wednesday following, at the hour designated. The payment of the 
 money and the delivery of the release were to be concurrent acts. 
 The satisfaction, therefore, was executory. It was postponed until 
 the future. There had been simply an accord of their minds upon the 
 terms of the settlement. It was, therefore, an uncompleted contract, 
 one which could not be enforced by action or substituted for the exist- 
 ing contract. The rights of the parties herein cannot be stated more 
 forcibly by me than to quote from Justice Barrett in the case of Pan- 
 zerbeiter v. Waydell, 21 Hun, 161. In that case one of the parties 
 had made a claim against the other and action had been brought there- 
 on. Negotiations were then undertaken for a settlement and the 
 terms had been agreed upon, but the payment of the claim and the 
 execution of the release and the discontinuance of the action were to 
 be made on a future day. The learned justice says with reference there- 
 to: "There was no acceptance of the discontinuance and release, nor 
 were they even left with the defendants or their attorneys. There 
 was, in fact, no intention to surrender these documents without con- 
 current payment. * * * This is a plain case of an accord execu- 
 tory ; such an agreement would have been no bar to the original suit 
 unless executed by the acceptance of the $150. * * * The promise 
 to discontinue and release was not binding upon the plaintiff. Con- 
 sequently the defendants were without a consideration for their prom- 
 ise. In the case of mutual and concurrent promises there must be rec- 
 iprocity of obligation." Mitchell v. Hawley, 4 Denio, 414, 47 Am. 
 
 38 Part of the dissenting opinion of Haight, J., is omitted. 
 
972 DISCHARGE OF CONTKACT (CL 5 
 
 Dec. 260; Russell v. Lytle, 6 Wend. 391, 22 Am. Dec. 537; Daniels 
 V. Hallenbeck, 19 Wend. 408; Tilton v. Akott, 16 Barb. 598; Day 
 V. Roth, 18 N. Y. 448; Kromer v. Heim, 75 N. Y. 574, 31 Am. .Rep. 
 491; Brennan v. Ostrander, 50 N. Y. Super. Ct. 426; Noev. Christie, 
 51 N. Y. 270; Osborn v. Robbins, 37 Barb. 481. 
 
 I do not understand the learned Chief Judge to question the rule 
 I here invoke. He, however, contends, if I, understand his opinion 
 correctly, that the claim existing between Schmidt and the defendant 
 was an unmatured claim, and for that reason the parties had the right 
 to agree upon the compromise of it, and that it was not subject to 
 the rule that, where a payment of a portion of an undisputed claim 
 had been made and receipt given therefor in full, it did not conclude 
 the party from recovering the balance due, as stated in the case of Ryan 
 v., Ward, 48 N. Y. 204, 8 Am. Rep. 539. I quite agree to this. I 
 concede that the parties may agree to surrender and compromise an 
 unmatured claim. They may also agree to compromise and settle a 
 disputed claim. What I do not agree to is that a different rule ob- 
 tains with reference to the settlement of a disputed claim from that 
 of an immatured claim. Where the minds meet upon the terms of a 
 settlement of a disputed claim and the delivery of the release, and the 
 payment is postponed to a future date, it is but an accord executory, 
 and not a complete settlement or agreement, for the reason that no con- 
 sideration passes between the parties at the time. It is but a mutual 
 understanding as to terms, but a failure to complete by satisfaction. 
 The same is true with reference to the settlement of an unmatured 
 claim. Hearn v. Kiehl, 38 Pa. 147, 80 Am. Dec. 472. 
 
 Under the provision of the contract the whole of the $8,600 be- 
 came due and payable from the defendant to Schmidt upon the con- 
 summation of the resale of the premises. This took place, within a 
 few minutes after 3 o'clock of the day that was fixed for the settlement 
 between the defendant and Schmidt. It is quite possible that the 
 defendant had reason to believe that .this sale would be effected when 
 he made his offer to compromise with Schmidt. Schmidt was not 
 advised of the fact that negotiations for a sale were pending between 
 the defendant and Wanamaker. But, in view of the findings in 
 this case, I incline to the view that no question of law arises with 
 reference to this branch of the case which we can consider upon this 
 review. 
 
 I favor an affirmance of the order of the Appellate Division. 
 
 MERRY V. ALLEN. 
 (Supreme Court of Iowa, 1874. 39 Iowa, 235.) 
 
 The plaintiff brought this action to foreclose a mortgage given to 
 secure ten promissory notes fqr $2,000 each, the suit being to foreclose 
 for the notes due. . 
 
Sec. 5) NOVATION — SUBSTITUTED CONTEAOT 97S 
 
 The defendant, Allen, answered admitting the execution of the 
 notes and mortgage by him and his co-defendant Richart, who, it is 
 alleged, had conveyed his interest in the mortgaged premises to Allen. 
 The answer further alleges that the plaintiff and the defendant, Al- 
 len, on the 30th day of January, 1871, executed an agreement, as 
 follows : 
 
 Allen was to keep only a part of the land originally bought and to 
 give his notes for different sums, with a new mortgage as security. 
 Merry agreed to return the original notes and mortgage, the sub- 
 ject of the present action. The writing stated it was "for the pur- 
 pose of a full and complete settlement." 
 
 The plaintiff replied that the new contract was never finally agreed 
 upon and has never been performed by either party. 
 
 Verdict was for the defendant. Plaintiff appeals.'* 
 
 Miller, C. J. I. It is insisted by the appellant's counsel, that the 
 defendant has undertaken to plead an accord and satisfaction in bar 
 of the plaintiff's action, but that he fails to allege full performance 
 on his part. At the common law it is well settled, that an accord 
 without satisfaction is no bar to a suit on the original obligation. If, 
 however, the accord be founded upon a new consideration, and accept- 
 ed as satisfaction, it operates as such and will take away the rem- 
 edy upon the old contract. See Hall v. Smith, 15 Iowa, 584, and au- 
 thorities cited. 
 
 In the case before us the new agreement pleaded in the answer is 
 not properly an accord. It is rather in the nature of a rescission of 
 a former contract, and the substitution therefor of a new and differ- 
 ent one, based upon a new consideration. The original contract was 
 for the sale to the defendant of certain real and personal property 
 for a consideration in money, to be paid to the plaintiff. The new 
 agreement stipulates for the rescission of the former contract; a 
 re-conveyance by the defendant of most of the land and personal prop- 
 erty purchased under the first contract, the delivery up of the notes 
 made by defendant to plaintiff, and various other stipulations on 
 part of each of the parties. 
 
 This new agreement being based upon a new consideration, if 
 accepted by the plaintiff as a compromise of, or in substitution for, 
 the indebtedness of the defendant under the original contract would 
 have the effect to take away any right of action which the plaintiff 
 previously had on the first contract. There was, therefore, no error 
 in the refusal of the court to give the instructions asked by the plain- 
 tiff touching this question. The court properly left it to the jury to 
 determine whether this new agreement was entered into by the par- 
 ties. In other words, whether this agreement or the one alleged by 
 the plaintiff was the actual contract made by the parties, and accept- 
 
 »* The statement of facts is condensed. 
 
974 DISCHARGE OF CONTRACT (Ch. 5( 
 
 ed by plaintiff as a compromise of the defendant's indebtedness to 
 her 
 
 II*. It is insisted that the verdict is not sustained by sufficient evi- 
 dence. 
 
 Upon appellant's theory of the law, that it was necessary for the 
 defe;ndant to show a full and complete performance on his part of the 
 new, agreement, it is possible that the verdict could not be upheld. 
 But, in the view we have taken of the case, it was only necessary 
 that the defendant should show that this new agreement was entered 
 into by the parties. In other words, that he should show the making 
 of the agreement by both parties. By its terms it purports to be for the 
 the compromise of an indebtedness from the defendant to the plain- 
 tiff, and the substitution of a new contract ufwn a new consideration 
 extinguishing such indebtedness. It was not required of the de- 
 fendant that he should show that he had fully performed on his 
 part the new agreement. The defense was complete by proving the 
 making and acceptance of the new contract. That the evidence was 
 sufficient to warrant the jury in 'thus finding, we entertain no doubt. 
 
 If the defendant has failed to comply with the new agreement, 
 plaintiff's remedy is on that agreement. 
 
 'The foregoing view fully disposes of the case, and, relieves us from 
 a discussion of the other questions presented by counsel for appellant, 
 which in our opinion are not material. 
 
 The judgment of the \:ourt below will be affirmed.'^ 
 
 ElvTON COP DYEING CO., Limited, v. ROBERT BROAD- 
 BENT & SON, Limited. 
 
 (In the Court of Appeal, 1919. 122 Law Times, 142.) 
 
 The plaintiffs were a limited liability company and they car- 
 ried on the business of spinners and doublers of yarn. 
 
 The defendants were a limited liability company, and they were mak- 
 ers of winding and doubling machinery. 
 
 By several contracts, made on various dates between the months 
 of March and Oct. 1915, the plaintiffs agreed to buy from the defend- 
 ants, and the defendants agreed to sell and deliver to the plaintiffs 
 
 3 5 In accord: Bahcoek v. Hawkins, 23 Vt. 561 (1851); Morgenthaler v 
 Sofliers, 164 Wis. 159, 159 N. W. 717 (1916) ; Simmons v. Globe Printing Co. 
 ■ 201 Mo. App. 133, 209 S. W. 130 (1919) ; Hall v. Smith, 15 Iowa, 584 (1864) 
 Nassoiy v. Tomlinson, 148 N. Y. 326, 42 N. E. 715, 51 Am. St. Rep. 695 (f896) 
 Lorentowicz v. Bowers, 91 N. J. Law, 225, 102 Atl. 630, L. R. A. 1918B, 1139 
 (1917), '"this distinctly left it to the jury to say whether the old arrangement 
 was superseded by the return of the goods and an agreement to pay $100 
 more, or whether the actual payment of the $100 with the return of the goods 
 was a prerequisite to the new arrangement going into effect, which is the 
 precise distinction between what is called a novation and an accord and satis- 
 faction unexecuted" ; Morecraft v. Allen, 78 N. J. Law, 729 75 Atl 920 L 
 R. A. 1915B, 1 (1910) ; Simmons v. Clark, 56 111. 96 (1870). 
 
Sec. 5) NOVATION SUBSTITUTED CONTRACT 975 
 
 sixteen doubling frames of the defendant's manufacture for the use 
 of the plaintiffs in their mills for their said business. * * * 
 
 It was a term and condition of the contracts * * * that the 
 doubling frames would do the plaintiffs' work satisfactorily. 
 
 The plaintiffs further alleged that the defendants were at all times 
 aware (as the fact was) that the doubled yams produced by the plain- 
 tiffs were yarns in which regularity of twist was an essential, and the 
 plaintiffs, in the course of entering into the contracts, made known to 
 the defendants that the doubling frames * * * were required for 
 the purpose of producing yarns as aforesaid and that the plaintiffs were 
 relying upon the skill and judgment of the defendants. Accordingly 
 it was, by sect. 14 of the Sale of Goods Act 1893, a term and condition 
 of the contracts, and each of them, that the doubling frames would be 
 reasonably fit for the said purpose. 
 
 In purported performance of the contracts, the defendants had de- 
 livered to the plaintiffs sixteen doubling frames, and had been paid for 
 ten of the same. * * * fhe frames so delivered, however, were 
 defective and incapable of doing the plaintiffs' work satisfactorily 
 * * * and were, not reasonably fit for the purpose aforesaid. 
 
 The frames were, the plaintiffs alleged;, incapable of producing even- 
 ly doubled yam, or yarn with regularity of twist, by reason of the 
 fluctuating speed at which the yarn continually left the bobbin on the 
 spindle, the yarn coming off in jerks and very irregularly. * * , * 
 
 The plaintiffs on numerous occasions in their correspondence and 
 interviews with the defendants complained, as they alleged, of the 
 defects and gave to the defendants notice of the losses that were being 
 and were likely to be incurred by the plaintiffs by reason of the de- 
 fects, and ultimately on the 8th May 1917 it was agreed by and between 
 the plaintiffs and the defendants that the defendants should alter the 
 said frames and remedy the said defects upon the terms. and condi- 
 tions set out in the correspondence confirming such agreement. 
 
 The principal term of the agreement was contained in a letter which 
 was written to the plaintiffs by the defendants on the 8th May 1917 
 and which was as follows : 
 
 In consideration of our agreeing to bear half the expense of add- 
 ing nip rollers and cap bars to the remaining fourteen frames to your 
 instructions, you will pay for the machines and withdraw all claims 
 against us for any damages in respect of the frames delivered or on 
 any other account. 
 
 The plaintiffs had at all times been ready and willing as they alleged 
 to fulfil their part of the agreement of the 8th May 1917, but the de- 
 fendants after having altered or remedied seven of the doubling frames 
 had, wrongfully and in breach thereof failed, neglected, and refused to 
 alter or remedy the remaining seven of the doubling frames which re- 
 mained useless and worthless to the plaintiffs. 
 
 By reason of the premises the plaintiffs had, as they alleged, been 
 damnified. They had lost the price of the defective machines and the 
 
976 DISCHARGE OF CONTRACT (Ch. 5 
 
 cost incurred in the erection of the same. They had further incur- 
 red loss on large quantities of yarn and manufactured goods spoilt 
 through defective doubling and through cancellations of contracts on 
 the part of their customers and through allowances which they had 
 had to make to their customers in respect of faulty yarn, and had also 
 sustained loss of production through the doubling frames being un- 
 usable. 
 
 The plaintiffs accordingly claimed £16,280 18s. Id. damages in an 
 action by them Against the defendants which was commenced on the 
 9th April 1918. 
 
 On the 23rd May 1919 the action came on for trial before Shearman, 
 J., sitting without a jury at the Manchester Assizes when the follow- 
 ing judgment was delivered. 
 
 Shearman, J. I had better deliver judgment now on this particular 
 point. 
 
 This is an action brought by the plaintiffs and elaborated in great 
 detail. It is an action for damages on several contracts, which are set 
 out in the statement of claim, and which were made between the months 
 of March and Oct. 1915, and a large superstructure of particulars and 
 pleadings has been reared on that claim. 
 
 The pleader was fully aware that a further agreement was entered 
 into on the 8th M'ay 1917, because the draughtsman of the statement 
 of claim, who took his risk in his hands, has pleaded that agreement, 
 and has pleaded there was an a!greement that the defendants should 
 alter the doubling frames upon certain terms and conditions, and he 
 went on to allege that the terms and conditions had not been fulfilled, 
 and that therefore the plaintiffs fell back on their original cause of ac- 
 tion. It is perfectly good pleading in that sense. On the face of it, 
 it was not in the least demurrable, because the agreement between the 
 parties was a conditional one, and the condition is accord and satis- 
 faction. The plaintiffs agreed to take in satisfaction a certain accord 
 subject to the condition that it was complied ■<vith in certain ways. 
 
 The pleader for the defendants took another view as to that agree- 
 ment, and alleged that the document which had been entered into was 
 not an accord and satisfaction which depended upon certain conditions 
 or satisfaction. But he pleaded in plain terms, and quite accurately, 
 that the document which had been referred to in the statement of claim 
 amounted to an agreement which was common ground to both parties. 
 He pleaded that the agreement was accepted by the plaintiffs in dis- 
 charge of their alleged cause of action. 
 
 I have to consider, looking at this document entered into, whether 
 the plaintiffs when they entered into the agreement to abandon their 
 claim, entered into an -agreement which was only to abandon it condi- 
 tionally upon the full performance of the substituted agreemetit, or 
 whether they agreed to take certain terms in satisfaction of their cause 
 of action. It is an interesting and arguable point and I may be 
 wrong. * * * 
 
Sec. 5) NOVATION SUBSTITUTED CONTRACT 977 
 
 The result is that, holding the view I do that this was an accepting 
 by the plaintiffs of the promise of the defendants as an accord and 
 satisfaction of their claims, the only remedy left for the plaintiffs is, if 
 the new contract is not performed, an action for the breach of the new 
 contract without recourse to the original cause of action. 
 
 The pleadings are in an action brought on the original cause of ac- 
 tion and not on the substituted cause of action. Therefore, unless any- 
 thing can be done by way of amendment it seems to me that the action 
 fails and must be dismissed with costs. 
 
 From that decision the plaintiffs now appealed.^° 
 
 Warrington, L,. ]. This is an action brought by the plaintiffs to 
 recover damages for breach of a warranty as to the quality of the 
 goods, the subject of a contract for the sale of those goods by the de- 
 fendants to the plaintiffs. 
 
 The parties had disputed as to whether there had or had not been 
 a breach of this warranty, and that dispute had taken place during the 
 month of Feb. 1917. To that action it is pleaded — which is the only 
 plea that I need refer to — as follows : "The defendants agreed on the 
 terms and conditions set out in certain letters which are referred to in 
 par. 6 of the statement of claim to bear half the actual cost of nip- 
 rollers and cap-bars for fourteen frames on the plaintiffs' instructions, 
 and in consideration of the defendants so agreeing the plaintiffs agreed 
 to pay for the doublirig frames and withdraw all claims against the 
 defendants for any damages in respect of the frariies delivered or of 
 any other account. The said agreement was accepted by the plaintiffs 
 in discharge of the alleged cause of action." 
 
 Now, putting it shortly, without reference to the particular facts, it 
 comes to this : There is a cause of action for damages for breach of 
 the original contract. That cause of action is satisfied by an accord 
 and satisfaction, that accord and satisfaction being the entering by the 
 defendants and the plaintiffs into the subsequent agreement as it is 
 pleaded. 
 
 I think that the law with reference to the question is put as neatly 
 as it can be in Morris v. Baron and Co. (118 L. 'T. Rep. 34; (1918) A. 
 C. 1, at p. 35). It is in the speech of Lord Atkinson in the House of 
 Lords. "The law as to the accord and satisfaction of a breach of an 
 agreement was much discussed in argument. There is no doubt that 
 the general principle is that an accord without satisfaction has no legal 
 effect, and liat the original cause of action is not discharged as long as 
 the satisfaction agreed upon remains executory. That w&s decided so 
 long ago as 1611 in Peytoe's case (9 Rep. 77 (b), 79 (b). If, however, 
 it can be shown that what a creditor accepts in satisfaction is merely his 
 debtor's promise and not the performance of that promise, the original 
 cause of action is discharged f ronj the date when the promise is made." 
 
 3 6 Parts of the statement, parts of the opinions of Warrington and Atkin, 
 Ii. JJ., and all of the opinion of Eve, J., are omitted. 
 
 COBBIN CONT — 62 
 
978 DISCHARGE OP CONTRACT (Ch. 5 
 
 The question here is whether the plaintiffs did or did not accept 
 the promise of the defendants contained in the agreement, which is 
 alleged as accord and satisfaction, in satisfaction of their cause of ac- 
 tion. If they did, then that cause of action is gone, and if they have any 
 further complaint to make it must be for breach of the second of the 
 two agreements. * * * • 
 
 The question really, I think, turns upon what is the meaning of the 
 first clause of the agreement. Reading that first clause it seems to me 
 quite plainly to express the agreement of the parties fo accept that 
 promise in satisfaction. It is in consideration not of the defendants 
 doing what they agree to do, but in consideration of their agreeing. I 
 insert the implied clause which I think must be there : On the defend- 
 ants agreeing to add the nip-rollers and cap-bars to the remaining four- 
 teen frames, and to bear half the expense, then the plaintiffs will pay 
 for the machines and withdraw all claims against the defendants for 
 any damages in respect of the frames delivered, or on any other ac- 
 count. That is to say, in consideration of the defendants agreeing to 
 do this the plaintiffs will agree to withdraw their present cause of ac- 
 tion. * * * 
 
 On the whole the judgment of the learned judge, in my opinion, was 
 correct. I think, therefore, this appeal ought to be dismissed. 
 
 Atkin, ly. J. I agree. 
 
 In my judgment there is no doubt that there can be no discharge 
 of a contract after breach except by alleging an accord and satisfac- 
 tion. But, at the same time, I think that there can be ho doubt but that 
 the satisfaction may consist in the accord between the parties. It may 
 be treated by both parties as satisfaction. 
 
 For that proposition though there is judicial authority to which I will 
 refer, I should like to rely upon the passage in the third edition of 
 BuUen and Leake, Precedents and Notes (at p. 478) : "A substituted 
 agreement in my opinion may be accepted in accord and satisfaction of 
 an existing cause of action, the new promise only, and not the perform- 
 ance of it, being taken in satisfaction and discharge." * * * 
 
 When you contemplate that the promise, that which was to be done, 
 was something which it was contemplated would at least take seven 
 weeks and would only take seven weeks on the condition that the ma- 
 terial was to be obtained, and when one recognises the difficulty that 
 there was in 1917 in obtaining material of any sort, the formaHties that 
 had to be gone through by way of obtaining priority certificates and so 
 on, and that the parties were contemplating a possible performance aft- 
 er seven weeks, whereas measures had been taken to bring the dispute 
 before the court there and then because a writ had been issued, it seems 
 to me quite plain that the parties intended that the plaintiffs' claim 
 should be abandoned at once, and that the promise might come after 
 the final withdrawal of the claim. That seems to me to make it quite 
 plain that that which was the consideration for the withdrawal of the 
 
Sec. 6) ACCOED EXBCUTOKT ACCORD AND SATISFACTION 979 
 
 claim was the promise to do the act and not the performance of the 
 promise. 
 
 Therefore I think that in the present case the plea is correct and is 
 established, and I think that the original cause of action was dis- 
 charged. * * * 
 
 Appeal dismissed. 
 
 SECTION 6.— ACCORD EXECUTORY— ACCORD AND 
 SATISFACTION 
 
 RICHARDS V. BARTLET. 
 (In the King's Bench, 1584. 1 Leon. 19.) 
 
 Dorothy Richards, executrix of A. her former husband, brought 
 an action upon the case upon a promise against Humfrey Bartlet, 
 and declared, that in consideration of two weights of corn deliver- 
 ed by the testator to the defendant, he did promise to pay to the 
 plaintiff ten pounds, to which the defendant said, that after the as- 
 sumpsit the plaintiff in consideration, that the said two weights 
 were drowned by tempest, and in consideration that the defendant 
 would pay to the plaintiff for every twenty shillings of the said ten 
 pounds three shillings four pence, scil. in toto thirty three shillings 
 four pence, did discharge the said defendant of the said promise, 
 and averred further, that he hath been always ready to pay the said 
 sum newly agreed, upon which there was a demurrer. And the 
 opinion of the whole Court was clearly with the plaintiff, first be- 
 cause that here is not any consideration set forth in the bar, by 
 reason whereof the plaintiff should discharge the defendant of this 
 matter, for no profit but damage comes to the plaintiff by this new 
 agreement, and the defendant is not put to any labour or charge by 
 it, therefore here is not any agreement to bind the plaintiff, see 
 19 H. 6. Accord, 1. 9 E. 4. 13. 12 H. 7. 15. See also Onlies case, 
 19 Eliz. Dyer, then admitting, that the agreement had been suffi- 
 cient, yet because it is not executed, it is not any bar: and after- 
 wards judgment was given for the plaintiff. 
 
 REILLY V. BARRETT. 
 
 (Court of Appeals of New York, 1917. 220 N. Y. 170, 115 N. E. 453.) 
 
 Action by William F. Reilly against William M. Barrett, as president 
 of the Adams Express Company. A judgment for the plaintiff was 
 unanimously affirmed by the Appellate Division (168 App. Div. 925, 
 
980 DISCHAKGB OF CONTEAOT . (Ch. 5 
 
 931, 152 N. Y. Supp. 1139), and defendant appeals by permission. 
 Affirmed. 
 
 Andrews, J. This action was brought to recover damages for per- 
 sonal injuries caused by the alleged negligence of the defendant. 
 As an affirmative defense a supplemental answer alleged: 
 
 "That on or about the 16th day of August, 1912, the defendant, 
 in good faith, served his verified answer to the complaint herein de- 
 nying generally the validity of the plaintiff's claim, and thereafter, 
 and on or about the 10th day of 'December, 1913, an agreement was 
 made between the plaintiff and the defendant, through their respec- 
 tive attorneys, by which the defendant agreed to pay to the plaintiff 
 in full settlement of the cause of action set forth in the complaint 
 the sum of $200, and the plaintiff, in consideration thereof, agreed 
 to accept the said sum in full settlement of the action, and upon the 
 payment thereof to discontinue the action without costs." 
 
 The answer then alleges tender of the sum of $200 to the plaintiff 
 and his refusal to accept the same, and the continued readiness of 
 the defendant to pay over such sum to the plaintiff. 
 
 The sufficiency of this defense was challenged by the demurrer, 
 and the sole question in this court is whether the decision of the 
 Special T«rm, affirmed by the Appellate Division, sustaining such 
 demurrer, is correct. ' 
 
 An agreement whereby one party undertakes to give or per- 
 form, and the other to accept in settlement of an existing or ma- 
 tured claim something other than what he believes himself entitled 
 to, is an accord. The execution of such an agreement is a satis- 
 faction. 
 
 An accord, when followed by satisfaction, is a bar to the asser- 
 tion of the original claim. Until so followed it has no effect. 
 
 The fact that the original claim is based on contract or in tort is 
 immaterial. Either may be barred by accord and satisfaction. So 
 it is whether the claim is liquidated or unliquidated, except that in 
 the former case certain principles as to consideration are enforced 
 which are not applicable to the latter. 
 
 These rules apply to every such transaction. It may be called a 
 compromise. But whatever the name given the original claim is 
 not barred until the satisfaction is completed. Kromer v. Heim, 
 75 N. Y. 574, 31 Am. Rep. 491 ; Brooklyn Bank v. De Grauw,' 23 
 Wend. 342, 35 Am. Dec. 569. 
 
 The satisfaction contemplated by the accord may involve the pay- 
 ment of money or the delivery of property. Or the creditor may 
 agree to accept the debtor's promise itself in satisfaction rather 
 than the performance of this promise. Kromer v. Heim, supra. 
 
 In any event the defendant who seeks to set up this defense as a 
 bar to the original action must allege and prove both the accord and 
 the satisfaction. If his claim be that his promise was accepted in 
 satisfaction, that he must plead. The burden is upon him to show the 
 
Sec. 6) ACCORD EXECUTORY ACGOED AND SATISFACTION 981 
 
 existence of a bar. Babcock v. Hawkins, 23 Vt. 561. Because of 
 his failure to include such a statement in his supplemental answer 
 the demuirer thereto was rightly sustained. 
 
 The answer clearly shows an executory agreement by which the 
 defendant agreed, within a reasonable time, to pay the plaintiff the 
 sum of ^00, and by which the plaintiff agreed to accept that sum 
 when tendered in settlenient of the action, and thereupon to dis- 
 continue such action without costs. There is no allegation that the 
 defendant's promise was to be received in satisfaction, and no facts 
 pleaded from which such an inference can be drawn. The answer 
 is therefore defective in that it pleads only an accord. 
 
 The plaintifif relies upon Bandman v. Finn, 185 N. Y. 508, 78 N. 
 E. 175, 12 L. R. A. (N. S.) 1134. But, as is clearly pointed out, that 
 was the case of a creditor holding an unmatured and contingent 
 obligation agreeing with his debtor for the surrender of the obliga- 
 tion. The authority of Kromer v. Heim is not weakened, and it 
 has been cited as late as Mance v. Hossington, 205 N. Y. 33, 98 
 N. E. 203. 
 
 The judgment appealed from should be afi&rmed, with costs. 
 
 Judgment afifirmed. 
 
 WHITE V. GRAY et al. 
 (Supreme Judicial Court of Maine, 1878. 68 Me. 579.) 
 
 Walton, J. Plaintiff held a note against defendants for $800. De- 
 fendants were insolvent and were endeavoring to compound with 
 their creditors. In consideration of which, the plaintiff agreed 
 that, if their efforts were successful, he would take in payment of 
 his note a lot of land, and new notes for $500, payable, one-half in 
 one year, and one-half in two years. Defendants' efforts were suc- 
 cessful, and they offered to settle with the plaintiff upon the terms 
 stated in the agreement ; but he refused, denying all liability under 
 his agreement, and claiming the full amount due upon his note. 
 No deed of the land was ever executed, nor were the notes mention- 
 ed in the agreement ever made or tendered to the plaintiff. 
 
 The question is whether these facts constitute a vahd ground of 
 defense to an action on the note. We think not. 
 
 It is settled law in this state that a defense based on an alleged 
 accord and satisfaction can be sustained only when the accord has 
 been completely executed. Neither an offer to perform nor an ac- 
 tual tender of performance is sufi&cient. Nothing short of actual 
 performance — meaning thereby, performance accepted — will sus- 
 tain such a defense. The debtor's remedy, if the creditor has wrong- 
 fully refused to accept performance, is a separate action upon the 
 agreement. Young v. Jones, 64 Me. 563, 18 Am. Rep. 279; Bragg 
 v. Pierce, 53 Me. 65; Gushing v. Wyman, 44 Me. 121. 
 
982 DISCHARGE OF CONTEACT (Ch. 3 
 
 The agreement which, in the case first cited, failed as a ground of 
 defense, was successful when made the ground of a separate action. 
 Mattocks V. Young, 66 Me. 459. 
 
 The distinction between an agreement which is, per se, to satisfy 
 and extinguish an existing debt, and an agreement, the perform- 
 ance of which is to have that effect, must not be overlooked. The 
 former operates as an immediate satisfaction of the debt. The lat- 
 ter, only when performed. The agreement set up as a defense in 
 this case is clearly of the latter kind. 
 
 Judgment for plaintiff.*' 
 
 WALTER H. GOODRICH & CO. v. FRIEDMAN et al. 
 (Supreme Court of Errors of Connecticut, 1917. 92 Conn. 262, 102 Atl. 607.) 
 
 Action by Walter H. Goodrich & Co., a corporation; against Louis 
 Friedman and others. Judgment for plaintiff, and defendants appeal. 
 Error. ' 
 
 Action to recover the value of certain goods and articles sold and 
 delivered, brought to and tried by the city court of New Haven. Facts 
 found and judgment rendered for the plaintiff and appeal by the de- 
 fendants. Error. 
 
 The plaintiff is a corporation engaged in the business of selling oils, 
 
 s' That an accord executory is no bar, even though the defendant has 
 tendered perforiliance and this has been refused by the plaintiff, see Carter 
 V. Wormald, 1 Ex. 81 (3 847); Gabriel v. Dresser, 15 C. B. 622 (1855); 
 Cooke V. McAdoo, 85 N. J. Law, 692, 90 Atl. 302 (1914) ; Humphreys t. 
 Third Nat. Bank, 75 Fed. 852, 859, 21 C. C. A. 538 (1896) ; Young v. Jones, 
 64 Me. 563, 18 Am. Rep. 279 (1875); Clifton v. Litchfield, 106 Mass. 34 
 (1870) ; Kidder v. Kidder, 53 N. H. 561 (1873) ; Russell v. Lytle, 6 Wend. 
 (N. Y.) 390, 22 Am. Dec. 537 (1831) ; Til ton v. Alcott, 16 Barb. (N. T.) 598 
 (1853) ; Heam v. Kiehl, 38 Pa. 147, 80 Am. Dec. 472 (1861) ; Keen v. 
 Vaughan's Ex'x, 48 Pa. 477 (1865) ; Kromer v. Heim, 75 N. T. 574, 31 Am. 
 Rep. 491 (1879), where there was perhaps only an unaccepted offer and not 
 a new agreement; Harbor v. Morgan, 4 Ind. 158 (1853) ; Camden Fire Ins. 
 Ass'n V. Baird (Tex. Civ. App.) 187 S. W. 699 (1916) ; James v. David, 5 
 T. R. 141 (1793), Lord Kenyon saying: "I am sorry that the agreement, as 
 disclosed in the plea, is not a conclusive answer to the action ; but as no 
 satisfaction is pleaded, the plaintiff is entitled to judgment." 
 
 In Y. B. 15 Edw. IV, 8, pi. 5, Pigot, J., said : "There is a difference be- 
 tween an arbitrament and an accord ; in the case of an accord an actual pay- 
 ment or other recompense Is necessary, or it will not be valid; if there is 
 a dispute between you and me as to certain trespasses, whereupon there is 
 an accord between us that I pay certain money in settlement, and I tender 
 the money to you and you refuse to receive it, the accord is void, but if you 
 receive the money it operates as satisfaction. Also for non-payment of the 
 money you would have no action. In arbitraments it is otherwise, for upon 
 an award that I pay you certain m.oney you would have an action." 
 
 After bilateral contracts became enforceable at common law, attempts were 
 made to cause a bilateral accord to operate as satisfaction. See Reniger & 
 Fogasse's Case, 1 Plow. 1 (1550) ; Termes de la Ley, tit. Concord; Case v. 
 Barber, T. Raym. 450 (1681) ; Allen v. Harris, 1 Ld. Raym. 122 (1701). These 
 attempts failed, except where the new contract is clearly substituted for the 
 prior claim. 
 
Sec. 6) ACCOED EXECUTORY ACCORD AND SATISFACTION 983 
 
 gasoline, and the like. The defendants, between the dates of July 15, 
 1915, and December 13, 1916, made purchases of oils, gasoline, and oth- 
 er products, and made payments for these articles as set forth in the 
 bill of particulars and made part of the plaintiff's complaint. On or 
 about November 6, 1916, the plaintiff demanded payment of the de- 
 fendants, who then owed the plaintiff $595.56, but the defendants were 
 unable to pay in cash. The plaintiff requested the defendants to ex- 
 ecute a note for the amount of the indebtedness then existing, and 
 suggested a note payable in 60 days. The defendants refused to give 
 a 60-day note, bvit offered to execute a note payable in 4 months, where- 
 upon a note in the following form was executed and delivered to the 
 plaintiff. 
 
 "595.56. November 6, 1916. 
 
 "Four months after date we promise to pay to the order of Walter 
 H. Goodrich & Co. five hundred and ninety-six and °^/ioo dollars at 
 Union & N. H. Trust Co. Value received." 
 
 There was no agreement between the plaintiff and the defendants that 
 this note was received in payment of the existing debt. The plaintiff 
 indorsed the note and discounted it at the bank where it was made pay- 
 able, where it was later protested for nonpayment. The plaintiff still 
 holds the note, and it is unpaid. The note was at all times the property 
 of the plaintiff. This action was instituted on December 19, 1916, prior 
 to the maturity of the note. The amount of the plaintiff's claim as it 
 appears from its bill of particulars is $755.05. Of this amount $156.49 
 represents sales which were made subsequent to November 16, 1916, 
 the date of the note. The defendants admitted the execution, delivery, 
 and acceptance of the note by the plaintiff, but claimed that the plain- 
 tiff was precluded from obtaining a recovery for the sum of $596.56, 
 the amount of the note, before it became due. The trial court over- 
 ruled this claim, and rendered judgment for the full amount of the 
 plaintiff's bill. 
 
 There are several reasons of appeal. In substance, the error assigned 
 is the conclusion of the trial court that the plaintiff's acceptance of the 
 negotiable promissory note and the negotiation of the same did not pre- 
 clude a recovery of the indebtedness evidenced by the note before its 
 maturity. 
 
 RoEABACK, J. (after stating the facts as above). This action was 
 cornmenced about 2% months before the maturity of the note. It is 
 a general rule that the nonexistence of a cause of action at law when 
 the suit is brought is a fatal defect, which cannot be cured by the ac- 
 crual of a right of action while the suit is pending. In other words, 
 an action at law can be supported only on the facts as they existed 
 when the action was commenced. Woodbridge v. Pratt & Whitney Co., 
 69 Conn. 304, 305, 37 Atl. 688 ; Dickerman v. N. Y., N. H. & H, R. Co., 
 72 Conn. 271, 275, 44 Atl. 228. , i ' 
 
984 DISCHARGE OF CONTEACT (Ch. 5 
 
 The acceptance of the note in the present case was at the least an 
 agreement for delay, and the plaintiff could not commence an action 
 on the original debt evidenced by the note until the note became due. 
 2 Parsons on Notes and Bills, 135. The reason for this rule is that the 
 entering into a new agreement and undertaking subjected the defend- 
 ants, debtors, to peculiar liabilities, or afforded the plaintiff, creditor, 
 fresh and peculiar rights which constituted a good consideration for the 
 extension of credit. Chitty on Contracts, 593. This note "implied an 
 agreement to suspend the rerhedy on the original demand during the 
 term of the note." Brabazon v. Seymour, 42 Conn, 551, 554. See, also, 
 1 C. J. p. 1 148, and cases cited in note 43 at the bottom of page 1 148. 
 
 It appears that when this action was commenced the note had been 
 discounted and was in the control of the bank, a bona fide holder. The 
 defendants at this time were liable to pay the note to a third party. To 
 now hold that the defendants at this time were liable for the price of 
 the goods for which the note was given would be a plain evasion of the 
 rule that a cause of action must be supported by the facts as they exist- 
 ed when the action was commenced. 
 
 There is error, and a new trial is ordered. 
 
 The other Judges concurred. °' 
 
 GOOD V. CHEESMAiSr. 
 (Court of King's Bench, 1831. 2 Barn. & Adol. 328, 109 Eng. Kep. 1165.) 
 
 Assumpsit by the plaintiff as drawer against the defendant as ac- 
 ceptor of two bills of exchange. Plea, the general issue. At the trial 
 before Lord Tenterden, C. J., at the sittings in London after Trinity 
 term 1830, it was proved, on behalf of the defendant, that after the 
 bills became due, and before the commencement of this action, the 
 plaintiff and three other creditors of the defendant met together,, in 
 consequence of a communication from him, and signed the following 
 mmorandum: "Whereas William - Cheesman of Portsea, brewer, is 
 indebted to us for goods sold and delivered, and being unable to make 
 an immediate payment thereof, we have agreed to accept payment of 
 the same by his covenanting and agreeing to pay to a trustee of 
 our nomination one third of his annual income, and executing a war- 
 rant of attorney as a collateral security until payment thereof. As wit- 
 ness our hands this 31st of October 1829." It did not appear whether 
 
 ssKendrick v. Lomax, 2 C. & .T, 405 (1832) ; Mercer v. Cheese, 4 M. & G. 
 804 (1842) ; Ford v. Beech, 11 Q. B. 852 (1848), semble. 
 
 The giving of a renewal note by a debtor is held to operate as a discharge 
 of a surety on his former debt, on the ground that it, suspends the creditor's 
 remedy against the debtor until the maturity of the renewal note. It is 
 generally assumed that the creditor's suit before that time would fail: See 
 Andrews v. Marrett, 58 Me. 539 (1870) ; Myers v. "Welles, 5 HiU (N. Y.) 
 4(33 (1843) ; Okie v. Spencer, 2 Whart. (Pa.) 253, 30 Am. Dec. 251 (1836) ; 
 Gould V. Bobson, 8 East, 576 (1807). 
 
Sec. 6) ACCORD EXECUTORY ACCORD AND SATISFACTION 985 
 
 or not the defendant was present when this paper was signed, nor did 
 he ever sign it; but it was in his possession at the time of the trial, 
 and he had procured it to be stamped. At the time of the signature, 
 the defendant had other creditors than the four above mentioned, and 
 particularly one Gloge, to whom he had given a warrant of attorney, 
 on which judgment had been entered up; and it was agreed, at the 
 meeting of the 31st of October, that if Gloge would come into the 
 arrangement there made, an additional i20 per annum should be set 
 apart by the defendant put of his income. The defendant, on the 
 16th of November 1829, wrote to the plaintiff as follows: "If you 
 should see Mr. Wooldridge" (one of the creditors who signed) "to- 
 day, I should be glad if you would endeavour to be at my house any 
 noon that you may be down, as there is an objection to the arrangement 
 by Mr. Gloge, the particulars of which I will explain when I see you. 
 I am sorry to be so troublesome; but, of course, I am anxious the 
 thing should be settled." Gloge never acceded to the agreement, nor 
 was any trustee ever nominated or covenant entered into, or warrant of 
 attorney executed, as therein mentioned. The bills of exchange con- 
 tinuing wholly unpaid, this action was commenced. The Lord Chief 
 Justice left it to the jury, as the only question of fact in the case, wheth- 
 er the agreement entered into by the four creditors was conditional 
 only, depending on Gloge's assent, or absolute; in the latter case, he 
 was of opinion that the defendant was entitled to a verdict. The 
 jury found for the defendant, but leave was given to move to enter a 
 verdict for the plaintiff. A rule nisi was obtained accordingly. 
 
 Lord TenTERDEn, C. J. Upon the whole, I am of opinion that the 
 verdict in this case was right. On the evidence it must be taken that 
 the defendant assented to the composition, and would have been willing 
 to assign a third of his income to a trustee nominated by the creditors, 
 and execute a warrant of attorney, as required by the agreement ; but 
 he could not do so unless the creditors would appoint a trustee to 
 whom such assignment could be made, or warrant of attorney executed. 
 That no such appointment took place was the fault of the creditors, 
 not of the defendant. It certainly appears that this was not an accord 
 and satisfaction properly and strictly so called, but it was a consent 
 by the parties signing the agreement to forbear enforcing their de- 
 mands, in consideration of their own mutual engagement of forbear- 
 ance; the defendant, at the same time, promising to make over a part 
 of his income, and to execute a warrant of attorney, which would have 
 given the trustee an immediate right for their benefit. Then is not this 
 a case where each creditor is bound in consequence of the agreement of 
 the rest? It appears to me that it is so, both on principle and on the 
 authority of the cases in which it has been held that a creditor shall 
 not bring an action, where others have been induced to join him in a 
 composition with the debtor; each party giving the rest reason to 
 believe that, in consequence of such engagement, his demand will 
 not be enforced. This is, in fact, a new agreement, substituted for 
 
986 DISCHARGE OF CONTRACT (Ch. 5 
 
 the original contract with the debtor ; the consideration to each credi- 
 tor being the engagement of the others not to press their individual 
 claims. 
 
 LiTTLEDALE, J. This is not strictly an accord and satisfaction or a 
 release, but it is a new agreement between the creditor and debtor, 
 such as might very well be entered into on a valid consideration. It 
 was not necessary in this particular case that there should be an 
 actual assignment, or execution of a warrant of attorney; if it only 
 rested with the plaintiff and the other creditors that the contract should 
 be carried into effect, and the defendant was always ready to do his 
 part, it is the same as if he had actually executed an assignment or 
 warrant of attorney. This case, therefore, is different from Heath- 
 cote V. Crookshanks (2 T. R. 24). And it would be unjust that the 
 plaintiff by this action should prejudice the other three creditors, each 
 of whom signed the agreement, and has since neglected the recovery of 
 his demand, under a persuasion that none of the parties to the memor- 
 andum would proceed against the defendant. 
 
 Parke, J. I am of opinion that the verdict was right. By the agree- 
 metlt entered into among these parties, the defendant was to give, 
 and the creditors to accept, certain securities for payment in the manner 
 there stipulated; and upon the faith of that compromise the three 
 creditors who signed with the plaintiff have postponed their demands. 
 Then, cannot this transaction be pleaded in bar to the present suit? 
 It is laid down in Com. Dig. Accord (B, 4), that an accord with mutual 
 promises to perform is good, though the thing be not performed at 
 the time of action ; for the party has a remedy to compel the per- 
 formance: but the remedy ought to be such that the party might 
 have taken it upon the mutual promise at the time of the agreement. 
 Here each creditor entered into a new agreement with the defendant, 
 the consideration of which, to the creditor, was a forbearance by all the 
 other creditors wl>o were parties, to insist upon their claims. Assump- 
 sit would have lain on either side to enforce performance of this agree- 
 ment, if it had been shewn that the party suing had, as far as lay in 
 him, fulfilled his own share of the contract. I think, therefore, that 
 a mutual engagement like this, with an immediate remedy givea for 
 non -performance, .although it did not amount to a satisfaction, was 
 in the nature of it, ,and a sufficient answer to the action. 
 
 PattEson, J. The question is, whether or not this agreement was 
 binding on the plaintiff. I think it was. The agreement was entered 
 into by him on a good consideration, namely, the undertaking of the 
 other creditors who signed the paper at the same time with him, on 
 the faith, which every one was induced to entertain, of a forbearance 
 by all to the debtor. 
 
 Rule discharged.^' 
 
 3» The executory composition agreement may itself be made to operate as 
 a substituted contract and novation 7 or the agreement may be that its per- 
 
Sec. 6) ACCORD EXBCUTORI — ACCORD AND SATISFACTION 987 
 
 HADI.EY FALLS NAT. BANK v. MAY. 
 (Supreme Court of New 'Xork, 1883. 29 Hun, 404.) 
 
 Appeal from a judgment in favor of the defendant, entered upon a 
 verdict directed by the court, and from an order denying a motion for a 
 new trial, made upon the minutes of the justice before whom the action 
 was tried. 
 
 Daniels, J. The defendant was clearly liable upon the notes made 
 by him which were set out in the complaint, unless the compromise 
 agreement delivered to him in May, 1875, in itself constituted a legal 
 defense. This agreement, as the evidence at the trial tended to es- 
 tablish it, was in the following form : ' 
 
 "Know all men by these preserjts, that we, the undersigned creditors 
 of Reuben May, do, for and in consideration of the sum of one dollar 
 
 formance shall operate as a satisfaction. See In re Hatton, L. R. 7 Oh. App. 
 723 (1872); In the latter case actual performance operates as a discharge 
 oven though it consists only in part payment of the debt, and meantime prior 
 to the time set for the substituted performance it operates to suspend the 
 creditor's original right: Beck v. Witteman Bros., 185 App. Div. 643, 173 
 N. X. Supp. 488 (1918). 
 
 In Slater v. Jones, L. R. 8 Ex. 186 (1873), action was brought against a debt- 
 or who pleaded that the creditors had passed a resolution under the Bankrupt- 
 cy Act of 1869 agreeing to accept a composition of six shillings in" the pound as 
 a full settlement, the time for payment of which sum had not yet arrived. This 
 was held to be a good plea. Kelly, C. B., said : "Could the legislature have 
 intended that a creditor who has assented to, or is bound by the resolution, 
 should the next day commence an action against the debtor for his whole debt? 
 Such a construction seems to me to be repugnant to common sense." After ap- 
 proving the decision of In re Hatton, L. B. 7 Ch. App. 726 (1872), holding 
 that after default by the debtor in performance of the composition the 
 creditor can maintain suit on the original claim In full, he continued : "Then 
 it is contended that the case of Ford v. Beech, 11 Q. B. 852 (1848), interposes 
 an insurmountable difficulty in the defendant's way ; for if the composition 
 resolution is a good bar now, the right of action for the debt would be gone 
 forever; and according to the decisions I have just referred to, it is clear 
 that the right is not gone, but exists if the debtor makes default. Ford v. 
 Beech, however, has no application here. For all that is necessary to decide 
 is that although, rebus sic stantibus, the plaintiffs have no cause of action, 
 in another state of circumstances a cause of action ma;r accrue to them." 
 
 Martin, B., said : "The principle [of Ford v. Beech] has itself been the 
 subject of much comment in recent cases, and it has been suggested by the 
 late Mr. Justice Willes that many of the difficulties caused by a rigid applica- 
 tion of it are removed by construing covenants not to sue as releases with 
 conditions subsequent." 
 
 Bramwell, B., made a similar attempt to distinguish Ford v. Beech. 
 
 In Newington v. Levy, L. R. 5 C. P. 607, 611 (1870), Willes, J., said: "We 
 see no difficulty in upholding a release with a condition subsequent. In ac- 
 cordance with the suggestion of Maule, J., in Gibbons v. Vouillon, 8 C. B. 
 487 (1849). * * * We can see no substantial distinction between the 
 case of a payment avoided by subsequent events and a release so avoided. 
 This is not a case of temporary suspension, like Ford v. Beech ; but a case 
 in which the release will be forever operative unless itself subsequently avoid- 
 ed. The distinction is fine, but it is supported by analogy, and it gives effect, 
 to the clear intention of the parties." He thereupon held that a plea of an 
 unexecuted composition was a good plea for the time being, but was after- 
 wards avoided by the nonpayment of the composition. This was affirmed 
 in the Exchequer Chamber, L. R. 6 C. P. 180 (1870). 
 
988 DISCHARGE OF CONTKACT ' ' (Ch. 5 
 
 to US each in hand' paid, covenant with the said Reuben May and with 
 each other to receive and accept the sum of twenty-five per centum on 
 the dollar, owing to us and set opposite to our names, in satisfaction of 
 our demands. 
 
 "In witness whereof we have hereunto set our hands and seals, this 
 day of May, 1875. 
 "[ly.S.] John Hancock National Bank, 
 
 "By R. S. Moore, President. 
 "Hadley Falls National Bank, 
 
 "By Ch. W. Ranlet, P. 
 "B. H. Arthur. 
 "In presence of Abram Kling." 
 
 The action upon the notes was commenced in December, 1880, and it 
 was shown upon the trial that payment of the stipulated sum of twenty- 
 five per cent, on the dollar had beendemanded alid refused. It was un- 
 der these circumstances that the court at the trial held that no action 
 could be maintained upon the notes themselves. This ruling seems to 
 have been made on the authority of Breck v.^ Cole, 6 N. Y. Super. Ct. 
 80, but that case was not authority for it. The action there determined 
 was upon a note made by the debtor himself, in addition to those which 
 the creditor-s by their composition agreement had stipulated to receive 
 in full satisfaction of their debts, and it was held that this additional 
 note of the debtor had been unlawfully exacted by the creditor and de- 
 livered to him by the debtor ; that it was a fraud upon the other credi- 
 tors, and therefore no action could be maintained upon it. 
 
 This principle is very well settled and entered into the decision of the 
 case of Lawrence v. Clark, 36 N. Y. 128. But it was not involved in 
 the determination of the present case, and failed to justify the disposi- 
 tion which was made of it at the circuit. The case of Good v. Chees- 
 man, 2 Barn. & Adol. 328, relied upon as sustaining the ruling which 
 was made, was also clearly distinguishable in its facts, for there the 
 creditors agreed to accept payment of their debts by the debtor, "cove- 
 nanting and agreeifig to pay to a trustee of our nomination one-third 
 of his annual income, and executing a warrant of attorney as collateral 
 security until payment thereof." The debtor was always ready to per- 
 form, but the creditors failed to appoint the trustee to whom payment 
 could be made, and the warrant of attorney delivered. And it was be- 
 cause the creditors had accepted this covenant, which the debtor had 
 been at all times ready to perform and they had deprived him of the 
 power of doing so by their omission to select the trustee, that the de- 
 fense depending upon the composition agreement was sustained. The 
 case of Norman v. Thompson, 4 Exch. 755, is equally as inappHcable 
 to the present controversy, for there had been no default in the per- 
 formance of the agreement. But the debtor, on the contrary, showed 
 by his plea the sufficiency of wliich was in controversy that he had been 
 at all times ready and willing to perform. 
 
Sec. 6) ACCORD EXECUTORY ^ACCORD AND SATISFACTION 989 
 
 By the agreement which was entered into on the part of the plaintiff 
 in this action the only covenant or stipulation ' which was rhade, was 
 that it would accept the sum of twenty-five per centum on the dollar in 
 satisfaction of its demands. It was therefore not an agreement to ac- 
 cept or receive the promise of the debtor to pay that amount in satis- 
 faction, but the actual payment of that percentage by the debtor was 
 requisite to perform the agreement and satisfy the debts. The terms 
 of the agreement can be satisfied by no other rational construction; 
 and where that is the effect which must be given to them, then the debt- 
 or caimot rely upon the agreement for his protection after he himself 
 has failed to perform it by refusing to make the stipulated payment. 
 The case of Penniman v. Elliott, 27 Barb. 315, is a direct authority 
 supporting this legal proposition. Its correctness was conceded in Hall 
 V. Merrill, 18 N. Y. Super. Ct. 266, and it has repeatedly been applied 
 in the same manner in the determination of the effect of similar com- 
 promises or compositions made under the bankrupt law. 
 
 In re Hatton, L. R. 7 Ch. App. Cases, 726, the creditors had agreed 
 to accept live shillings in the pound in two installments in satisfaction 
 of their debts. The debtor paid the first but failed to pay the second 
 installment, and on account of that default the creditors were held 
 entitled to enforce the original liability as that had been incurred by 
 the debtor. And a similar view was sustained in Gbldney v. Lording, 
 L. R. 8 Q. B. 182, and Newell v. Van Praagh, L. R. 9 Com. Pleas, 96. 
 
 The principle applicable to this class of cases is that if the promise 
 be "for a pew consideration, performable at a future day certain, then 
 the original right of action is suspended until that day comes. If the 
 promise is then duly performed this right is destroyed, but if the prom- 
 ise is not then duly performed this right revives and the promisee has 
 his election to sue on the original cause of action or on the new prom- 
 ise, unless by the terms or the legal effect of the new contract the new 
 promise is itself a satisfaction and an extinction of the old one." 2 
 Pars, on Con. (6th Ed.) 683. And where the time of performance 
 has not been specified the debtor is required to perform it within a rea- 
 sonable time, and if he fails to do so the consequence will be the same 
 under this general principle of the law. The same distinction was ap- 
 proved in Kromer v. Heim, 75 N. Y. 574, 31 Am. Rep. 491, and 
 Chemical Bank v. Kohner, 85 N. Y. 189, and Baxter v. Bell, 86 N. Y. 
 195, in no respect whatever either questions or impairs its effect. 
 
 By the failure of the debtor to pay the stipulated twenty-five per cent 
 mentioned in the agreement delivered to him he deprived himself of all 
 the benefit which it was designed he might secure by the performance 
 of its terms. From the time of that failure the proposal ceased to 
 be binding upon the plaintiff, and it afterwards had the right to resort 
 to the notes held by it and enforce them as legal obligations against 
 him. The judgment and order should therefore be reversed and a 
 new trial directed, with costs to the plaintiff to abide the event. 
 
990 DISCHARGE OF CONTEAOT (Ch. 5 
 
 MacombEr, J., concurred. 
 
 Present — Davis, P. 'J., Daniels and MacombEr, JJ. 
 Judgment and order reversed and a new trial directed, with costs to 
 plaintiff to abide event.*" 
 
 LYNN et al. v. BRUCE. 
 (Court of Common Pleas, 1794. 2 H. Bl. 317, 126 Eng. Kep. Reprint, 571.) 
 
 This was an action of assumpsit. The first count of the decla- 
 ration was on a forbearance to sue on a bond given by the defend- 
 ant to the plaintiffs for £200. The second was as follows: "And 
 whereas also afterwards, &c. in consideration that the said Robert 
 and Thomas (the plaintiffs) at the special instance .and request of 
 the said Charles (the defendant) had then and there consented and 
 agreed to accept and receive, of and from the said Charles, a cer- 
 tain composition of fourteen shillings in the pound, and so in pro- 
 portion for a lesser sum than a pound, upon a certain other sum of 
 one hundred and five pounds five shillings and two pence, then due 
 and owing from the said Charles to the said Robert and Thomas, 
 upon and by virtue of a certain other writing obligatory, bearing 
 date, &c. made and executed by the said Charles to the said Rob- 
 ert and Thomas, whereby he became held and firmly bound to them, 
 in the sum of two hundred pounds, in full satisfaction and discharge 
 of the said last mentioned writing obligfatory, and all monies due 
 thereon, he the said Charles undertook and then and there faithfully 
 promised the said Robert and Thomas to pay them the said com- 
 position of fourteen shillings in the pound, and so in proportion for 
 a lesser sum than a pound, upon the said last mentioned sum of 
 one hundred and five pounds five shillings and two pence, upon re- 
 quest; and the said Robert and Thomas in fact say, that the said 
 composition of fourteen shillings in the pound, and so in propor- 
 tion for a lesser sum than a pound, upon the said last mentioned 
 sum of one hundred and five pounds five shillings and two pence, 
 amounted to a large sum of money, to wit, the sum of seventy-three 
 pounds thirteen shillings and sixpence, to wit, at Westminster afore- 
 said, whereof the said Charles afterwards, to wit, on the same day 
 and year last aforesaid, at Westminster aforesaid, had notice; and 
 although the said Charles hath paid to the said Robert and Thomas 
 
 *» In accord: In re Hatton L. R. 7 Ch. App. 726 (1872) ; Ransom v. Geer 
 (C. C.) 12 Fed. 607 (1882) ; Flack v. Garland, 8 Md. 188 (1855) ; Pennlman 
 V. Elliott, 27 Barb. (N. T.) 315 (1858) ; Braude v. Vehon, 201 111. App. 486 
 (1916) ; Beck v. Witteman Bros., 185 App. Div. 643, 173 N. Y. Supp. 488 
 (1918). 
 
 There is no revival of the original right in case the debtor's promissory 
 notes were given and accepted in instant satisfaction, even though these notes 
 are never paid. Bartlett v. Woodworth-Mason Co., 69 N. H. 316, 41 Atl. 264 
 (1898) ; Swartz v. Brown, 135 App. Div. 913, 119 N. Y. Supp. 1024 (1909) ; 
 Mullin V. Martin, 23 Mo. App. 537 (1886). 
 
Sec. 6) ACCORD EXECUTOKY-^ACCOED AND SATISFACTION 991 
 
 a certain sum of r^ney, to wit, the sum of seventy pounds and six 
 shillings, part of the said last mentioned sum of seventy-three 
 pounds thirteen shillings and six pence, the amount of the said last 
 mentioned composition, yet the said Charles not regarding, &c. 
 hath not yet paid the sum of three pounds seven shillings and six 
 pence, being the residue of the said sum of seventy-three pounds 
 thirteen shillings and six pence, the composition last aforesaid, or 
 any part thereof, &c." 
 
 A verdict having been found for the plaintiffs on the whole dec- 
 laration, a motion was made in arrest of judgment on the ground of 
 the insufficiency of the second count, and after argument the opin- 
 ion of the Court was thus delivered by 
 
 Lord Chief Justice EyrE. This is a motion made in arrest of judg- 
 ment, on an objection to the second count of the declaration. The 
 substance of that count is, that in consideration that the plaintiff at 
 the defendant's request, had consented and agreed to accept and re- 
 ceive from the defendant a composition of fourteen shillings in the 
 pound, and so in proportion for a lesser sum than a pound, upon 
 £105. 5s. 2d. due from the defendant to the plaintiff on a bond dated 
 the 30th March, 1792, for £200., in full satisfaction and discharge 
 of the bond and all money due thereon, the defendant promised 
 to pay the said composition. It is then averred, that the composi- 
 tion amounted to £73. 13s. 6d., and that the defendant had paid the 
 plaintiff £70. 6s., part thereof. The breach is, that he did not pay 
 £3. 7s. 6d. the residue. This will be found to be a very clear case, 
 when the nature of the objection is understood. The consideration 
 of the promise is, as stated in this count, an agreement to ac- 
 cept a composition in satisfaction of a debt. If this is an agreement 
 which is binding, and can be enforced, it is a good consideration. 
 If it is not binding, and cannot be enforced, it is not a good con- 
 sideration. It was settled in the case of Allen v. Harris, 1 Lord 
 Raym. 122, upon consideration of all the cases, that upon an ac- 
 cord, which this is, no remedy Hes; it was said, that the books are 
 so numerous that an account ought to be executed, that it was im- 
 possible to overturn all the authorities; the expression is, "over- 
 throw all the books." It was added, that if it had been a new point, 
 it might have been worthy of consideration. But we think it was 
 rightly settled upon sound principles. "Interest reipublicse ut sit 
 finis litium;" accord executed is satisfaction; accord executory is 
 only substituting one cause of action in the room of another, which 
 might go on to any extent. The cases in which the question has 
 been raised, whether an accord executory could be enforced, and in 
 which it has been so often determined that it could not, have been 
 cases in which it has been pleaded in bar of the original action. But 
 the reason given in three of the cases in 1 Roll. Abr. title Accord, 
 pi. 11, 12, 13, is, because the plaintiff hath not any remedy for the 
 whole, or where part has been performed for that which is not per- 
 
992 DISCHARGE OF CONTRACT (Ch. 5| 
 
 formed ; which goes directly to the gist of this action, as it is stated 
 in the count objected to. This is an action brouPit to recover dam- 
 ages, for that part of the accord which has not been performed. 
 But an accord must be so completely executed in all its parts, be- 
 fore it can produce legal obligation of legal effect, that in Peytpe's 
 Case, 5 Co. 79 b, it was holden, that where part of the accord had 
 been executed, tender of the residue would not be sufficient to make 
 it a bar to the action, but that there must be an acceptance in sat- 
 isfaction. There are two cases in Cro. Eliz. 304, 305, to the same 
 effect. It was argued according to the cases in Roll. Abr. that an 
 accord executory in any part, is no bar, because no remedy lies for 
 it for the plaintiff. Perhaps it would be a better way of putting the 
 argument to say that no remedy lies for it for the plaintiff, because 
 it is no bar. But put either way, it concludes in support of the ob- 
 jection to the second count in this declaration, and consequently the 
 judgment must be arrested. 
 
 Rule absolute to arrest the judgment.*^ 
 
 NASH V. ARMSTRONG. 
 
 (In the Common Pleas, 1861. 10 C. B. [N. S.] 259; 142 Bng. Rep. Re- 
 print, 451.) 
 
 The declaration stated that, by deed dated the 29th of February, 
 1860, the said John Beatson, being then possessed thereof for a term 
 which had not yet expired, let to the defendant certain rooms part of 
 a house of the said John Beatson, therein described, from the 1st of 
 March in that year to the 24th of June in that year, at rent to be as- 
 certained by two valuers, one on the part of the said John Beatson, and 
 one on the part of the defendant, or an umpire to be agreed on by the 
 said two valuers, such rent to include the use of the fixtures and fit- 
 tings then in and upon the said demised premises, and which then be- 
 longed to the said John Beatson, the expense of the valuerto be em- 
 ployed by the said John Beatson to be paid in the first instance by the 
 defendant, and retained by him out of the rent for the said demised 
 premises accruing due from him on the said 24th of June, 1860; and 
 afterwards the said valuers were respectively accordingly duly ap- 
 pointed, but did not, without any default of the said John Beatson or 
 the plaintiff in that behalf, ascertain the rent so to be paid as afore- 
 
 *i Other cases saying that upon an accord no remedy lies are Allen, v. 
 Harris, 1 Ld. Raym. 122 (1701) ; Reeves v. Hearne, 1 M. & W. 323 (1836) ; 
 Clifton V. Litchfield, 106 Mass. 34 (1870) ; Bell v. Pitman, 143 Ky. 521, 186 
 S. W. 1026, 35 li. R. A. (N. S.) 820 (1911). This rule is sometimes explained 
 on the ground that an accord lacks consideration. Bryant v. Gale, 5 Vt. 416 
 (1832) ; Tucker v. Dolan, 109 Mo. App. 442, 84 S. W. 1126 (1905). Some- 
 times the supposed "accord" is a mere unaccepted offer ; more often the real 
 question before the court is vrhether there has been a discharge of the former 
 claim and not whether the new agreement itself creates a legal duty. 
 
Sec. 6) ACCORD BXECtlTOEY ACCORD AND SATISFACTION 993 
 
 said, or appoint any umpire ; and the defendant, nevertheless, at his 
 request, occupied the said rooms under the said demise until the said 
 24th of June, and afterwards as tenant thereof to the plaintiff as ad- 
 ministrator as aforesaid, for a long time, to wit, until the 1st of Sep- 
 tember, 1860, the said John Beatson having previously died : , that 
 afterwards, and whilst the amount of rent to be paid by the defendant 
 for and in respect of his said occupation of the said rooms to the said 
 24th of June, and thence to the said 1st of September, was and re- 
 mained unascertained and not agreed upon, and unpaid, it was, at the 
 defendant's request, mutually agreed between the plaintiff as adminis- 
 trator as aforesaid, and the defendant, that, if the plaintiff, as ad- 
 ministrator as aforesaid, would not insist upon such valuation as afore- 
 said, and would not require that the said valuers should be called upon 
 to appoint an umpire to ascertain the amount of the said rent to be paid 
 for the defendant's said occupation until the said 24th of June, and 
 that the said valuers should be instructed not to appoint sucn umpire 
 as aforesaid, the defendant would pay to the plaintiff, as administrator 
 as aforesaid, for and in respect of his occupation of the said rooms 
 under the said deed, and for and in respect of the said subsequent oc- 
 cupation thereof as "tenant to the plaintiff as administrator as afore- 
 said, a reasonable sum in that behalf, to wit, the sum of £70 ; and that 
 neither the plaintiff as administrator as aforesaid nor the defendant 
 should ever call upon the other of them to carry out or perform or ful- 
 fil the terms of the said deed : Averment, that the plaintiff did every- 
 thing, and everything existed and had before suit happened to entitle 
 the plaintiff, as administrator as aforesaid, to payment of the said 
 sum of money last mentioned, to wit, £70: Breach, that no part there- 
 of had been paid. 
 
 To this count the defendant demurred, the ground of demurrer stat- 
 ed in the margin being, "that a contract under seal cannot be varied or 
 discharged by a parol agreement." Joinder. 
 
 R. G. Williams, in support of the demurrer. There is no valid con- 
 sideration for the promise stated in the declaration. [Williams, J. 
 Why is it not a good consideration in assumpsit, that the plaintiff fore- 
 goes his rights under the deed?] It is varying by parol the terms of a 
 deed; [Williams, J. That is not so.] By the parol agreement, the 
 defendant is to pay the rent ascertained in a way different from that 
 provided by the deed. [Williams, J. The plaintiff is seeking to en- 
 force an agreement founded upon a consideration that the plaintiff 
 will not put in force his rights under the deed.] A deed can only be 
 varied by deed. Would a recovery in this action be pleadable in bar to 
 an action upon the deed? [WiLLES, J. I should have thought it a 
 good answer by way of equita.ble plea. The payment of the £70 under 
 the agreement would surely be ground for an unconditional perpetual 
 injunction against proceeding upon the deed.] *^ * * * 
 
 *= Part of the argument of counsel Is omitted. 
 
 OOEBIN OONt. — 63 
 
994 DISCHARGE OF CONTKACT (Ch. 3 
 
 Williams, J. I am of opinion that there should be judgment for the 
 plaintiff on this demurrer. I do not think it necessary to dispute the 
 correctness of many of the doctrines contended for in the argument; 
 for, I do not consider that the conclusion we have arrived at in any 
 degree conflicts with any of the rule§ of law adverted to. On the face 
 of this declaration there is an admitted promise by the defendant to 
 pay a certain sum of money at a stipulated time, and an admitted breach 
 of that promise. That is a perfectly good promise if founded upon 
 a sufficient legal consideration; and the simple question is, whether 
 there is a sufificient legal consideration disclosed on the declaration. I 
 am of opinion that there is. It appears upon the face of the declara- 
 tion that the plaintiff, as the personal representative of the original con- 
 tracting party, being in a condition to bring an action upon the original 
 contract, or otherwise to put it in force, in consideration of his abstain- 
 ing from enforcing the rights conferred on him by that contract, the 
 defendant promised to pay in respect of the occupation of the premises 
 under the deed referred to, and in respect of his subsequent occupa- 
 tion thereof as tenant to the plaintiff; as administrator^ a reasonable 
 sum. It was not necessary; in order to make that a good consideration, 
 that the mutual promises should amount to a release of the right of 
 action flowing from the original contract. The plaintiff, having a, right 
 to enforce the benefits conferred on him by the contract, enters into 
 an agreement not to do so, whereby he changes his situation to this 
 extent, that, whereas before he had a right to sue upon the deed, if he 
 now exercises that right he renders himself liable to an action. He 
 has, therefore, plainly given a good consideration for the defendant's 
 promise, and there is a complete cause of action disclosed on the face 
 of the declaration. Upon principle, this is in truth nothing more 
 than the ordinary case to be found in the old books, of an action 
 against an heir whose ancestor has made a bond binding himself and 
 his heirs, and who has assets by descent: if he contracts with the 
 obligee of the bond, that, if the latter will forbear to put the bond in 
 suit, he will pay the sum secured by a given day, — that is a good as- 
 sumpsit, and the forbearance till the day named is a good considera- 
 tion to support the promise. The bond is not released by that. The 
 only result is, to subject the obligee to an action if he puts the bond 
 in suit before the expiration of the time agreed on. To that extent 
 the terms of the bond are varied, and yet the bond remains unreleased; 
 nevertheless, the consideration which flows from the agreement of the 
 obligee not to put the bond in suit is good, and furnishes a ground of 
 action if it is broken. That principle is applicable here. 
 
 WiLLEs, J. I am entirely of the same opinion. It appears to me 
 that this declaration is neither open to the objection that it is an at- 
 tempt to vary by parol the terms of a deed, nor to the objection that it 
 is an action upon an accord. 
 
 BylEs, J. I had at first some doubt whether the maxim Unum- 
 quodque dissolvitur eodem legamine quo ligatur, was not applicable 
 
Sec. 6) ACCORD EXECUTORY ^ACCORD AND SATISFACTION 995 
 
 here; for, till satisfaction, the plaintiff might always have an action 
 upon the deed, and one cannot but see that this would lead to circuity 
 of action. Further, whatever may be the value of the decision in 
 Leslie V. De la Torre, the reported observations of Lord Kenyon are 
 very much in favour of Mr. Williams's argument. But Gwynne v. 
 Davy is not so. Three of the judges there intimate an opinion that an 
 action might be maintained on the parol agreement. And no other au- 
 thorities have been cited to shew that the rule is applicable to a cross- 
 action, and is not confined to an action on the deed. 
 
 Keating, J. I concur with the rest of the court in thinking that 
 the declaration discloses a promise founded on a good consideration, 
 and that it is not open to the objection that the plaintiff is seeking by 
 parol to vary the terms of an "instrument under seal. 
 
 Judgment for the plaintiff. 
 
 FRANCIS et al. v. DEMING et al. 
 (Supreme Court of Errors of Connecticut, 1890. 59 Conn. 108, 21 Atl. 1006.) 
 
 Thayer, J. To the. plaintiffs' complaint, claiming the foreclosure 
 of a judgment lien, the defendants, filed, a special answer alleging, in 
 substance, that the plaintiffs, after the judgment, was rendered and 
 after the judgment lien was filed, agreed to discharge the same if the 
 defendants should within one month from June 10, 1889, pay the 
 plaintiffs a sum materially less than the amount of the judgment, give 
 them a release of damages for the attachment made in the writ, and 
 make return to the probate court that the defendant Henry A. Deming 
 had given notice of the settlement of his administration account with 
 the estate of one Emily Francis, deceased ; and that said notice was 
 given, said release signed, and on the 8th, 9th, and 10th days of July, 
 1889, said Henry A. Deming went to the office of the plaintiffs' at- 
 torney prepared to pay the money and deliver the release, but did not 
 find the attorney, who was sick at home as the defendant then learned ; 
 and that afterwards, and after the present suit was brought, the money 
 was actually tendered to the plaintiffs' attorney, who refused to re- 
 ceive it. To this answer the plaintiffs demurred. The court sustained 
 the demurrer, and from that decision this appeal was taken. 
 
 It is not alleged or claimed that the defendants agreed to obtain the 
 release, make the return, and pay the money within one month from 
 June 10th, and that this agreement was accepted by the plaintiffs in 
 discharge of the judgment. It was not an accord with mutual prom- 
 ises, therefore, but a mere promise by the plaintiffs to discharge the 
 judgment if these things were done. Their performance was thus a 
 condition precedent to the defendants' right to a discharge. Goodrich 
 V. Stanley, 24 Conn. 613. The agreement, if the condition is fully per- 
 formed, constitutes an accord and satisfaction of the judgment, and is 
 
996 DISCHARGE OF CONTRACT (Ch. 5 
 
 a bar to the action. Unperformed, it is a mere accord, and does not 
 bar the action. Williams v. Stanton, 1 Root, 426 ; Scutt's Appeal, 43 
 Conn. 109. This is admitted by the defendants, but it is claimed that, 
 in law, what has been done by them constitutes performance. When 
 money is to be paid by one party to another, and the contract fixes no 
 place for the payment, the rule is that the payment must be to the per- 
 son at the place where he is, if he be within the same dominion. 1 
 Swift, Dig. 292 ; 2 Pars. Cont. 636. Parke, B., in Startup v. Mac- 
 donald, 6 Man. & G. 624, says : "In such a case the party bound must 
 find the other at his peril, and within the time limited, if he be within 
 the four seas." Here no place was fixed for the payment. It was the 
 defendants' duty, therefore, to seek the plaintiffs or their duly-author- 
 ized agent or attorney, and make tender to them within the time lim- 
 ited. This they did not do. Calling at the office of the attorney, pre- 
 pared to pay, does not meet the requirements of the law. Deming 
 there learned that the attorney was at his house. He made no tender 
 of the money and release at the office to the person in charge. He did 
 not seek the attorney at his house and tender them to him. Nor did he 
 seek the plaintiffs, who reside in an adjoining town, and tender per- 
 formance to them. The allegations of the answer show no excuse for 
 his failure to do so. No waiver of performance within the time lim- 
 ited is claimed. As the tender after the action was l>egun was of the 
 money only, and did ntft include either interest or the costs which had 
 accrued, it was not a legal tender, and would not entitle the defend- 
 ants to a discharge. 
 
 But the defendants urge that this is a proceeding in equity, and 
 that the rules of equity are not so stringent as those of law concern- 
 ing the necessity of a tender Within the time limited, and that, as the 
 answer shows that they were on July 10th, and still are, ready and 
 willing to perform, the demurrer should have been overruled. When 
 a condition is subsequent, and is broken, equity will generally relieve 
 the party in default if he shows sufficient excuse for non-performance 
 within the time specified. In the present case the defendants had no 
 right to a discharge of the judgment, except upon the: performance of 
 the condition within the time. The performance of the condition was 
 the consideration for the plaintiffs' promise to discharge the judgment. 
 In such a case, where the rights of the party in default are dependent 
 upon a condition precedent which is neither fulfilled nor waived, as no 
 right or title vests, equity can afford no relief. Davis v. Gray, 16 
 Wall. 203, 21 L. Ed. 447; Giddings v. Insurance Co., 102 U. S. Ill, 
 26 L. Ed. 92; Wells v. Smith, 2 Edw. Ch. (N. Y.) 78; Mills v. Hoag, 
 7 Paige (N. Y.) 21, 31 Am. Dec. 271 ; Seton v. Slade, 2 White & T. 
 Lead. Cas. (Har. & W. Amer. Ed:) 1143. This case presents no equi- 
 ties in the defendants' favor. The plaintiffs agreed, if the defendants 
 performed within one month, to accept nearly $300 less than was due 
 them upon their judgment. The return of the probate notice the de- 
 fendant Deming was legally bound to make. The release he has never 
 
Sec. 6) ACCOBD EXECUTORY ACCORD AND SATISFACTION 997 
 
 ■ 
 
 tendered. Under these circumstances, showing no excuse for non- 
 performance, neither law nor equity can afford him assistance. 
 
 There was no error in the judgment appealed from. The other 
 judges concurred.** 
 
 HUNT V. BROWN. 
 (Supreme Judicial Court of Massachusetts, 1888. 146 Mass. 253, 15 N. E. 587.) 
 
 HotMEs, J. The plaintiff made three notes. to Russell, the defend- 
 ant's intestate. Afterwards, according to the plaintiff's evidence in 
 the present case, Russell promised that if the plaintiff would assent to 
 a compromise by the executors of the plaintiff's father's will of a claim 
 in their hands against third persons, by which compromise the plain- 
 tiff's share of his father's estate would be diminished, Ryssell would ac- 
 cept in full settlement of the balance due upon the notes whatever per- 
 centage the executors should take in settlement of their claim. The 
 executors then settled the claim for 62 per cent, of the amount, with' 
 the plaintiff's assent; then Russell died and suit was brought by his 
 administrator, the present defendant, upon the notes, against the pres- 
 ent plaintiff. The latter pleaded a general denial, and payment, and 
 afterwards made an offer of judgment for the full amount of the notes, 
 interest, and costs, which was accepted, and the sum was paid. The 
 present suit is upon Russell's alleged agreement. The defendant asked 
 a ruling that the agreement was without consideration, and also that 
 the judgment in the former case was a bar. Both rulings were refused- 
 and he excepts. 
 
 1. It is very plain that the jury were warranted in finding that the 
 plaintiff's assent to the compromise was dealt with by the parties as- 
 a consideration, — that is, as the conventional inducement of Russell's 
 promise, and not merely as a condition precedent, — and that, if it was- 
 so dealt with, it was sufficient. Evidence, or even an admission, that 
 the compromise was for the plaintiff's advantage, would not alter the 
 case. In determining whether or not an act was dealt with by the par- 
 ties to an oral agreement as consi_deration, the fact that its conse- 
 quences were seen to be advantageous to the actor may .be important ; 
 but on the question of sufficiency alone it is enough that the immediate 
 effect of the act is an abandonment of an actualor supposed right, 
 whatever the balance of advantages may be in the long run. It is hard 
 to imagine any change of position, not made in pursuance of a pre- 
 vious duty, which may not be sufficient as a consideration, or which is- 
 not a detriment in a legal sense. 
 
 4s Where the so-called accord is not a bilateral contract, but is a mere offer 
 to be accepted by actual performance, it is revocable prior to action in reliance- 
 thereon ; and prior to performance it does not operate as a bar. See Kromer 
 V. Helm, 75 N. T. 574, 31 Am. Kep. 491 (1879) ; Harbor v. Morgan, 4 Ind. 15» 
 (1853). Nor would an action lie for refusal to perform as offered. 
 
998 DISCHARGH OF CONTRACT (Ch. 5 
 
 .< 2. If Russell had received the 62 per cent, as agreed, and the suit had 
 been brought for the residue, the question would arise whether the 
 acceptance of less than the sum due, upon a collateral consideration, 
 could be distinguished from an acceptance of less, before the notes fell 
 due, or, like that, constituted an accord and satisfaction, (BoAvker v. 
 Childs, 3 Allen, 434, 436;) and if it was technically a satisfaction, 
 whether, like a payment, (Fuller v. Shattuck, 13 Gray, 70), it must 
 not have been pleaded in the suit upon the notes, if it was to be re- 
 lied on at all ; or whether there remained any contract unexecuted by 
 the party satisfied, which he would break if he afterwards brought 
 'suit. But Russell did not accept 62 per cent., so that the only question 
 is whether his agreement in any other way extinguished the notes in 
 whole or in part ; since in that case the judgment might be a bar. 
 
 The agreement was not itself a satisfaction. It was not a new con- 
 tract substituted for the notes, and entitling the plaintiff to demand 
 their' surrender. Neither could it operate as a release of 38 per cent, 
 of 'the notes, when the percentage was fixed by the compromise referred 
 tOj. Language sometimes has been used which suggests that an agree- 
 ment for a sufficient consideration might take effect by way of re- 
 lease, although not under seal. Goodnow v. Smith, 18 Pick. 414, 416, 
 •29 Am. Dec. 600; Petty v. Allen, 134 Mass. 265, 267; Taylor v. Man- 
 ners, L,. R. i Ch. 48. But the common law knows no such release. 
 .Shaw V. Pratt, 22 Pick. 305, 308. The consideration of the notes be- 
 ing executed, the agreement could operate only by way of accord and 
 .'satisfaction. See Cumber v. Wane, 1 Smith, Lead. Cas. 633, (8th 
 Amer. Ed.) and notes; Bragg v. Danielson, 141 Mass. 195, 196, 4 
 N. E. 622 ; May v. King, 12 Mod. 537, 538. The suggestion which we 
 are considering, if stated in technical form, would have to be that 
 Russell accepted the plaintiff's assent to the compromise which he de- 
 sired in satisfaction of 38 per cent, of the notes. But this is plainly a 
 distortion of the evidence, according to which the assent was accept- 
 ed, not as partial satisfaction of a debt, but as the consideration for a 
 promise. 
 
 If, however, the jury might have been warranted in finding that 
 the agreement and what was done under.it had released or satisfied 
 38 per cent., they were warranted at least equally in. finding that it 
 was purely executory, in purport as well as in form, viz., to accept 
 a percentage in satisfaction when it was paid. The court could not 
 rule as "matter of law that the opposite construction ws.s the true 
 one, or assume the opposite construction as a foundation for its rul- 
 ings. 
 
 But it may be said that the contract must have been found to embrace 
 
 the element that Russell would not sue for more than 62 per cent., and 
 
 it may be argued that, if not technically a release, it ought to have 
 
 . been available in defense pro tanto, by way of estoppel or otherwise, 
 
 in order to avoid circuity of action, upon the same principle that a 
 
Sec. 6) ACCORD EXBCtJTOEY — ACCORD AND SATISFACTION 999 
 
 covenant not to sue is allowed to inure as a release. The answer is 
 that, whether available in this way or not, whether or not such a de- 
 fense would escape the objection that in substance it was accord with- 
 out satisfaction, the plaintiff was not bound to use the agreement in 
 defense. For if, as we have tried to show, and as the suggestion un- 
 der consideration assumes, Russell's agreement did not extinguish the 
 whole or any part of the notes, but left them in full force, it also neces- 
 sarily retained its independent character as a collateral contract. See, 
 further, Costello v. Cady, 102 Mass.-140; Blake v. Blake, 110 Mass. 
 202. A breach of it was a substantive course of action, upon which 
 the present plaintiff might bring his own suit in his own way, and 
 he was no more bound to plead it than he would have been bound to 
 plead a' set-off, fraud, or a breach of warranty. Smith v. Palmer, 6 
 Cush. 513, 521 ; Cobb v. Curtiss, 8 Johns. (N. Y.) 470. See Burnett v. 
 Smith, 4 Gray, 50, 52 ; Davis v. Hedges, L. R. 6 Q. B. 687. 
 
 When a defendant has the choice of setting up a matter in defense, 
 or of suing upon it in another action, if he chooses not to set it up in 
 defense, of course the judgment in the action against him is no bar 
 to a subsequent suit by him. Smith v. Palmer, ubi supra; Glass Co. 
 V. Morey, 108 Mass. 570, 573 ; Davis v. Hedges, ubi supra. Russell's 
 agreement was not pleaded in the former action. Even if it had been 
 executed, it would not have been admissible under a plea of payment. 
 Ulsch v. Muller, 143 Mass. 379, 9 N. E. 736; Grinnell v. Spink, 128 
 Mass. 25. The present plaintiff not having set up the agreement, and 
 having no other defense, very properly saved himself costs, and his 
 antagonist delay, by submitting at once to the inevitable, and offering 
 judgment. See Rigge v. Burbidge, 15 Mees. & W. 598. 
 
 Exceptions overruled.^* 
 
 ** Where a creditor makes a new agreement with a third person for the 
 future discharge of his claim toy a substituted performance by this third 
 person (Ute that in Ford v. Beech, ante, p. 937), this new agreement is said 
 not to be an "accord" and is certainly enforceable. Strutt v. Farlar, 16 M. 
 & W. 249 (1847) ; Henderson v. Stobart, 5 Exeh. 99 (1850). 
 
 An agreement between a creditor and his debtor providing for a future dis- 
 charge by a subtituted performance by the debtor may be made either before 
 or after breach of the original obligation by the debtor. It should be enforce- 
 able in either case. See, after breach: Orowther v. Farrer, 15 Q. B. 677 
 (1850) ; Farmers' State Bank v. Singletary, 22 Ga. App. 653, 97 S. E. 90 (1918) . 
 Before breach : Schweider v. Lang, 29 Minn. 254, 13 N. W. 33, 43 Am. Rep. 
 202 (1882) ; Smyth v. Holmes, 10 Jurist, 862 (1846), where Parke, B., said: 
 "Such an agreement before breach of the original agreement is binding. 
 * * * An action will lie on mutual promises ; and this is such an action, 
 and not an action on an accord." 
 
iOOO DISCHAEGE OF CONTRACT (Ch. 5 
 
 VERY V. LEVY. 
 (Supreme Court of the United States, 1851. 13 How., 345, 14 L. Ed. 1T3.) 
 
 Mr. Justice Curtis." This is a suit in equity to foreclose a mort- 
 gage, commenced in the Circuit Court of the United States for the 
 District of Arkansas. The bill alleges that on the 3d of March, 1841, 
 the respondent, Levy, executed his writing obligatory, for the sum of 
 four thousand dollars, bearing interest at the rate of seven per cent, 
 per annum, payable to Darwin Lindsley in six years after its date, and 
 secured the same by a mortgage on certain premises situated in the 
 city of Little Rock; that by assignment from Lindsley the complain- 
 ant became the owner of this bond and mortgage on the 25th of 
 March, 1841, and the bill prays for an account and foreclosure. 
 
 The answer of Levy admits the execution of a bond and mortgage, 
 and their assignment to the complainant, and avers that on the 3d of 
 March, 1843, he agreed with the complainant, through one John S. 
 Davis, his agent, to deliver goods such as jewelry, etc., in which the 
 respondent dealt, at Little Rock, upon reasonable prices, in satisfac- 
 tion of this bond and mortgage, within twelve months from the 3d of 
 March, 1843 ; that in pursuance of that agreement he did actually 
 deliver on that day a part of the goods, agreed to be of the value of 
 $1,898.25, and afterwardsj on the same day, the complainant, through 
 his agent, Davis, signed and delivered to the respondent a memorandum 
 in writing as follows : 
 
 "Little Rock, March 3d, '43. I hereby agree to take in goods, such 
 as jewelry, etc., the balance due me on a note assigned by D. Lindsley 
 to me, as also a mortgage assigned by said Lindsley ; said goods to be 
 delivered to me, or any agent at Little Rock, Arkansas, at reasonable 
 prices at said Little Rock; said goods to be called for within twelve 
 months from this time. Martin Very, by J. S. Davis, Attorney in 
 Eact." 
 
 That in further pursuance of this agreement, the respondent kept in 
 his hands, and ready for deliyery, and withdrawn from his trade, a 
 sufficient amount of goods, such as are referred to. in the memoran- 
 dum, during the whole year which elapsed after the making of the 
 agreement, and was constantly ready and willing to deliver the same 
 at Little Rock, but the complainant was not there, and did not author- 
 ize any one to receive them; that the respondent has ever since 
 been ready and willing to perform his agreement, and offers to bring 
 the goods into, court, or place them in the hands of a receiver. The 
 court below appointed a receiver, ascertained the amount of goods 
 necessary to satisfy the unpaid residue of the bond, ordered the re- 
 ceiver, upon demand, to deliver the same to the complainant, in full 
 satisfaction of the bond and mortgage, decreed the mortgage satisfied, 
 
 *5 Part of the report has been omitted. 
 
Sec. 6) ACCORD EXECUTORY ^ACCORD AND SATISFACTION 1001 
 
 and ordered the complainant to pay the costs. From this decree the 
 complainant appealed. 
 
 An agreement by a creditor, to receive specific articles in satisfaction 
 of a money debt, is binding on his conscience ; and if he ask the 
 aid of a court of equity to enforce the payment, he can receive that aid 
 only to compel satisfaction in the mode in which he has agreed to 
 accept it. A court of equity will even go further ; and in a proper 
 case will enforce the execution of such an agreement. At law, a mere 
 accord is not a defence ; and before breach of a sealed instrument, there 
 is a technical rule, which prevents such an instrument from being dis- 
 charged, except by matter of as high a nature as the deed itself. Alden 
 v. Blague, Cro. Jac. 99; Kaye v. Waghorne, 1 Taunt. 428; Bayley v- 
 Homan, 3 Bin. N. C. 915. But no such difficulties exist in equity. 
 On the broad principle that what has been agreed to be done, shall be 
 considered as done, the court will treat the creditor as if he had acted 
 conscientiously, and accepted in satisfaction what he had agreed to 
 accept, and what it was his own fault only that he had not received. 
 Indeed, even a court of law in a case free from the technical difficulties 
 above noticed, will do the same thing. Bradly v. Gregory, 2 Camp. 383. 
 
 In order, however, to bring a case within these principles, three 
 things are necessary. An agreement, not inequitable in its terms and 
 effect ; a valuable consideration for such agreement ; readiness to per- 
 form and the absence of laches on the part of the debtor. * * * 
 
 That the agreement itself imports a consideration, deemed by the 
 law valuable, there can be no doubt. An agreement to give a less sum 
 for a greater, if the time of payment be anticipated, is binding; the 
 reason being, as expressed in Pinnel's case, (5 Co. R. 117,) that perad- 
 venture parcel of the sum, before, the day, would be more beneficial 
 than the whole sum on the day. Coke's Lit. 212, b ; Com. Dig. Accord, 
 B. 2; Brooks v. White, 2 Mete. (Mass.) 283, 37 Am. Dec. 95. And 
 when the time of payment is not anticipated, the law deems the de- 
 livery of specific articles a good satisfaction of a money debt, becatise 
 it will intend them to be more valuable than the morifey to the creditor 
 who has consented to the arrangement. Bac. Ab. Accord, A ; Pinnel's 
 case, 5 Co. R. 117; Booth v. Smith, 3 Wend. (N. Y.) 66; Kellogg 
 V. Richards, 14 Wend. (N. Y.) 116; Steinman v. Magnus, 11 East, 
 390; Lewis v. Jones, 4 B. & C. 513. 
 
 In this case, both these rules apply; for the time of payment was 
 to be anticipated, and specific articles delivered. * * * 
 
 The decree of the Circuit Court is affirmed, with costs.** 
 
 *^ The findings and decree of the Circuit Court were as follows : 
 The case being heard on bill, amendment, answers, replications, exhibits, anif 
 testimony, the court held A'^ery bound by the agreement, and found that Levy 
 had always had sufficient goods on hand ready to be delivered ; and directed 
 the master to ascertain the balance due 'on the bohd, and the value of the 
 goods delivered to the receiver. ," ' 
 
 The master reported the balance due on the 3d March, 1844, to be ,'52,002.- 
 
1002 DISCHARGE OF CONTRACT (Cll. 5 
 
 PIERCE, BUTLER & CO. v. JONES & SON. 
 (Supreme Court of South Carolina, 1876. 8 S. C. 273, 28 Am. Eep. 288.) 
 
 Moses, C. J.*' This was an action on two several promissory notes 
 drawn by the respondents in favor of the appellants — one for $4,000, 
 dated 17th March, 1873, payable 1st March following; the other for 
 $5,820.03, dated 16th March, 1874, payable fifteen days after date. 
 The last was the aggregate of open accounts and small drafts due be- 
 fore 14th February, 1874, and is, alike with the first, subject to the op- 
 eration of the alleged agreement to be hereafter referred to. 
 
 • On the 14th February, 1874, the said J. J. Pierce, Butler & Co., with' 
 pther creditors of the said Thomas Jones & Son, executed a written 
 agreement in the following words : "We, the creditors of T. Jones & 
 Son, hereby agree to compromise with the said T. Jones & Son for 
 twenty-five cents on the dollar on the principal and interest of the sev- 
 eral amounts due us, and will give them a clear receipt of all indebt- 
 edness to us and our assigns, provided that all persons who may hold 
 any claim, account, note or other evidence of indebtedness shall" assent 
 to this settlement and arrangement." It appeared that each of the 
 said creditors had received the sum for which, by the agreement, they 
 had stipulated "to give a clear receipt of all indebtedness." 
 
 The report of the Referee states that all the other creditors had acted 
 in good faith in regard to its stipulation, and this must be held to in- 
 clude all the creditors of the respondents, for the agreement was on the. 
 condition that all persons who might hold any claim, &c., should assent 
 to it ; and if any other creditor had refused to enter into the compro- 
 mise it was to the interest of the appellants to show it, for in that event 
 the non-compliance with the proviso on which they were to be bound 
 might have operated to discharge them from its effect. 
 
 , The agreement was set up by the respondents as a discharge of 
 all the balance due upon the notes held by the appellants, by their ac- 
 ceptance of the payment of the one-fourth due thereon. The Circuit 
 Judge sustained the defense on the ground submitted and dismissed 
 the complaint. 
 
 59, and the value of the goods, $5,776.99. No exception was taken to the 
 report, and it was confinned. 
 
 The court then ordered the complainant to select out of the goods, to the 
 amount of $2,002.59, and on his failure, after notice to his solicitor, that the 
 master should do so. The complainant failed to select ; the master set apart 
 the requisite amount, the residue were redelivered to Levy, and the court 
 decreed that Very should receive the goods so set apart by the master, and 
 that the bond and mortgage were satisfied; denied the relief prayed, and dis- 
 missed the bill; all costs to be paid by the complainant. 
 
 In accord, see Chicora Fertilizer Co. of Charleston, S. C. v. Dunan, 91 Md. 
 144, ,46 Atl. 347, 50 U R. A. 401 (1900) ; Moers v. Moers, 229 N. Y. 294, 128 
 N. B. 202 (1920). 
 
 *T Part of the opinion is omitted. ■' 
 
Sec. 6) ACCORD EXECTJTOEY — ACCORD AND SATISFACTION 1003 
 
 The appeal seeks to reverse his judgment, and charges error of law, 
 therein. 
 
 It is contended, on behalf of the appellants, that a promissory note, 
 at maturity, is not satisfied by the acceptance of a part of the amount 
 due in discharge of the remaining balance, and that this principle must, 
 apply to exclude the defense relied on by the parties who now submit 
 the said agreement as a bar to the recovery of the remaining portion- of 
 the notes. 
 
 The English and American cases, (and in the last may be included 
 those in the Courts of this State,) it may be said, generally concur in 
 the doctrine announced in Pinnel's case, (5 Rep., 60, p. 117,) "that pay- 
 ment of a lesser sum on the day in satisfaction of a greater cannot be 
 any satisfaction of the whole, because it appears to the Judges that 
 by no possibility a lesser sum can be a satisfaction to the plaintiff for 
 a greater sum." While many eminent Judges have not hesitated to 
 notice and descant on the seeming inconsistency of the rule which per- 
 mits the acceptance of anything, — "a horse, a hawk, a robe," — no mat- 
 ter how inconsiderable the worth, to operate as a discharge of a debt 
 largely exceeding in amount the value of the article so received, and 
 still withholds a like 'effect to a payment in money unless for the whole 
 sum due, they have felt bound to conform to the decisions which Ijiave 
 confirmed it, extending as they do through a long succession of yeaxgj 
 An agreement to accept a lesser sum in discharge of a greater is not 
 allowed its proposed purpose for the want of a sufficient consideration 
 to support it. It is therefore permitted to have full , effect whenever 
 such payment is made and accepted under such circumstances and 
 at such time as a good, valid consideration for the promise and, as- 
 sumption of the creditor. While, therefore, the principle contended for 
 is fully sustained by the authorities, cited, and precludes the agreement 
 from operating in a technical sense as accord and satisfaction, or a 
 release, it fails in its application to the case here, because there was a 
 sufficient consideration to sustain it as a valid and binding con- 
 tract. * * * 
 
 The appellants in the case before us secured through the agreement 
 an advantage of which they possibly may have been deprived by the 
 application by the debtors of their assets among their creditors in. dif- 
 ferent proportions, giving to them a less share than to others, or, in 
 fact, they might have made a preference to one creditor to the exclusion 
 of all the rest, provided it was not undue and fraudulent. The appel- 
 lants secured by the agreement at least twenty-five per cent, of their 
 debt, when, if they had not entered into it, they stood the chance of 
 losing the whole. There is another view to be taken of the defense 
 which must bar the recovery. The agreement, we must assume, by the 
 proviso which it contains, was assented to by all the creditors of the 
 firm with whom it was made. , Each, in consideration of the receipt of 
 twenty-five per cent, of his demand, consented to accept it as a com- 
 
1004 DISCHARGE OF CONTEACT (Ch. 5 
 
 promise, by which he released all the balance, of his debt. , It was 
 founded on the principle of equality — all were to share alike. If the 
 appellants recovered in their action it would be a fraud on the other 
 creditors who were induced to accept the proportion fixed by the agree- 
 ment on the express stipulation that it was to be entered into by all 
 the creditors, and binding so far as to prevent either from obtaining 
 from the assets of the debtors more than the prescribed proportion. 
 Each creditor for his act "had the undertaking of the rest as a con- 
 sideration for his own undertaking." 
 
 The principle which governed the decision in Aiken v. Price, Dud. 
 52, applies in full force here. 
 
 The motion is dismissed. 
 
 Wright, A. J., and WilIard, A. J., concurred.** 
 
 PINNEL'S CASE. 
 (In the Common Pleas, 1602. 5 Coke, 117a.) 
 
 Pinnel brought an action of debt on a bond against Cole, of il6 for 
 payment of £8. 10s. the Uth day of Nov. 1600. The defendant plead- 
 ed, that he at the instance of the plaintiff, before the said day, scil. 1 
 Octob. anno 44. apud W. solvit querenti £5 2s. 2d. quas quidem £5 2s. 
 2d. the plaintiff accepted in full satisfaction of the £8 10s. And it was 
 resolved by the whole Court, that payment of a lesser sum on the 
 day in satisfaction of a greater, cannot be any satisfaction for the 
 whole, because it appears to the Judges that by no possibility, a lesser 
 sum can be a satisfaction to the plaintiff for a greater sum ; but the 
 gift of a horse, hawk, or robe, &c. in satisfaction is good.*' For it 
 shall be intended that a horse, hawk, or robe, &c, might be more bene- 
 ficial to the plaintiff than the money, in respect of some circumstance, 
 or otherwise the plaintiff would not have accepted of it in satisfaction. 
 But when the whole sum is due, by no intendment the acceptance of 
 parcel can be a satisfaction to the plaintiff: but in the case at Bar 
 it was resolved, that the payment and acceptance of parcel before the 
 day in satisfaction of the whole, would be a good satisfaction in re- 
 gard of circumstance of time ; for peradventure parcel of it before the 
 day would be more beneficial to him than the whole at the day, and 
 the value of the satisfaction is not material : so if I am bound in £20 
 
 *8 In accord: Cohen v. P. B. Harding Const. Co., 41 E. I. 242, 103 Atl. 702 
 <1918) ; Paddleford v. Thacher, 48 Vt. 574 (1876). 
 
 Where the parties to a pending action at law agree upon a- settlement and 
 this is fully performed, there is an accord and satisfaction; in case the 
 plaintifl; persists with the action, this can be set up by way of supplementary 
 answet (at common law,' a plea puis darrein continuance). Savage v. Edgar, 
 86 N. J. Eq. 205, 98 Atl. 407, 3 A. L. R. 1021 (1916). 
 
 *» Part payment by, giving a promissory note secured by a chattel mortgage 
 operates as satisfaction' If so agreed. Jaffray v. Davis, 124 N. Y. 164, 26 
 A'. E. 351, 11 L. E. A. 710 (1891). 
 
Sec. 6) ACCORD EXECUTORY- — ACCORD AND SATISFACTION 1005 
 
 to pay ilO at Westminster and you request me to pay you £5 at the 
 day at York, and you will accept it in full satisfaction of the whole £10 
 it is a good satisfaction for the whole : for the expencefe to pay it at 
 York, is sufficient satisfaction : but in this case the plaintiff had judg- 
 ment for the insufficient pleading; for he did not plead that he had 
 paid the £5 2s. 2d. in full satisfaction (as by the law he ought) but 
 pleaded the payment of part generally ; and that the plaintiff accepted 
 it in full satisfaction. And always the manner of the tender and of 
 the payment shall be directed by him who made the tendel" or pay- 
 ment, and not by him who accepts it. And for this cause judgment 
 was given for the plaintiff. 
 
 See reader 26 ±l. 6. Barre 37. in debt on a bond of £10 the de- 
 fendant pleaded, that one F. was bound by the said deed with him, and 
 each in the whole, and that the plaintiff had made ah acquittance to 
 if. bearing date before the obligation, and delivered after, by which 
 acquittance he did acknowledge himself to be paid 20s. in full satis- 
 faction of the £10. And it was adjudged a good bar; for if a man 
 acknowledges himself to be satisfied by deed, it is a good bar, with- 
 out any thing received. Vide 12 R. 2. Barre 243. 26 H. 6. Barre 37. 
 and 10 H. 7, &c. 
 
 SMITH V. JOHNSON. 
 (Supreme Judicial Court of Massachusetts, 1916. 224 Mass. 50, 112 N. B. 644.) 
 
 Action by Isabel S. Smith against Alson T. Johnson. Judgment 
 for plaintiff, and defendant appeals. Affirmed. 
 
 LoRiNG, J. It was held in Weber v. Couch, 134 Mass. 26, 45 Am. 
 Rep. 274 that an agreement (endorsed upon an execution) by which 
 a creditor acknowledged satisfaction of the judgment in considera- 
 tion of the payment of a smaller sum than the amount due thereon, 
 was invalid. 
 
 The defendant has tried to take the case at bar 'out of that deci- 
 sion by reason of the fact that in addition to paying the smaller 
 sum "in full satisfaction" the defendant in the case at bar "agreed 
 to pay the balance of the judgment." But in that contention the 
 defendant is met with the same rule of law which was decisive of 
 the case of Weber v. Couch. The parol promise to pay the balance 
 of the judgment did not impose upon the defendant a less onerous 
 liability than that imposed upon him by the judgment and did not 
 give to the plaintiff a more beneficial right than that given him by 
 it. It follows that the defendant's parol promise to pay the balance 
 of the .judgment was neither a benefit to the plaintiff nor a detriment 
 to the defendant and being without consideration was nudunj pac- 
 tum. 
 
 The defendant's other contention is that the promise to pay the 
 balance of the judgment comes within the doctrine on which it is 
 
1006 DISCHARGE OF CONTRACT (Ch. 5 
 
 held that a negotiable promissory note given by a -debtor is prima 
 facie payment of an open account for which he cites Isley v. Jewett, 
 2 Mete. 168, 173, and Wood v. Bodwell, 12 Pick. 268. But whether 
 the obligation assumed by the maker of a negotiable promissory 
 note is a more burdensome one than that resting upon one liable 
 upon an open account, the negotiable note is more beneficial than 
 the open account and for that reason there is a valid consideration 
 in that case. And for the matter of that a nonnegotiable note (which 
 is not within the rule invoked see Greenwood v. Curtis, 4 Mass. 93; 
 Maneely V. McGee, 6 Mass. 143, 145, 4 Am. Dec. 105) may be taken 
 in satisfaction. If it is taken as an account stated it is founded on 
 a valid consideration. " 
 
 The defendant's last contention is that inasmuch as the judg- 
 ment is satisfied on the 'record; the plaintiff's remedy is by way of 
 scire facias and for this he relies upon Perkins v. Bangs, 206 Mass.; 
 408, 92 N. E. 623, and Perry v. Perry, 2 Gray, 326. But upon the 
 face of the record the judgment was not satisfied. The endorsement 
 upon the execution states that the plaintiff had "received on the with- 
 in execution $125 in. full satisfaction." The $125 being a smaller 
 sum than that due upon the judgment, it is apparent Upon the ia,ce 
 of the execution that the judgment was not satisfied. 
 
 The entry must be : Judgment affirmed.^" 
 
 FULLER v. KEMP. 
 
 (Court of Appeals of New York, 1S93. 138 N. Y. 231, 33 N. E. 1034, 20 L. 
 
 R. A. 785.) 
 
 Action by Eraser C. Fuller against Edward Kemp, Jr., for bal- 
 ance due for professional services as a physician. From a judgment 
 of the general term (16 N. Y. Supp. 158) affirming a judgment in 
 plaintiff's favor, -defendant appeals. Reversed. 
 
 Maynard, J." The plaintiff has brought suit to recover a balance 
 claimed to be due for his services as a physician, and the defendant 
 relies solely upon the defense of an accord and satisfaction. The 
 parties have agreed upon a statement of facts embracing the entire 
 issue raised by the pleadings, and we are required tO determine 
 whether, upon the facts stipulated, the defendant has, as matter of 
 law, established his defense. The plaintiff's demand was unliqui- 
 dated, but he alleged that his services were worth $670, and render- 
 ed a bill for that amount, without specifying any items. The de- 
 fendant acknowledged the receipt of the bill by letter, and expressed 
 surprise at its magnitude, and his belief that there must be some 
 mistake about it, and requested plaintiff to look into it and send a 
 
 ^° Cf. Gordon v. Moore, 44 Ark. 349, 51 Am. Rep. 603 (1884). 
 ■SI Part of the opinion is omitted. 
 
Sec. 6) ACCORD EXECUTORY — ACCORD AND SATISFACTION 1007 
 
 corrected bill, as he was anxious to settle the matter at once. The 
 plaintiff then sent an itemized bill, showing 126 visits in 49 days, for 
 each of which a charge of $5 was made, and 4 consultations, at the 
 rate of $10 each, making a total of $670, as originally claimed. The 
 defendant then wrote the plaintiff, inclosing a check for $400, which 
 he stated was in full satisfaction of the plaintiff's claim for profes- 
 sional services against him to that date; and also saying that the 
 deductions he had made were in the instance where five, four, and 
 three visits per day had been charged at full rates; and that he 
 trusted the plaintiff would view the matter in the same spirit which 
 he did, which was to fix a figure which would be entirely just to 
 both parties ; and that he had arrived at this conclusion after care- 
 ful and earnest thought. The plaintiff received the letter and check, 
 indorsed the latter and collected the money upon it, which he re- 
 tained, and again sent his bill to the defendant, charging $670 for 
 his services, and crediting upon it $400 received by check. The de- 
 fendant thereupon again wrote the plaintiff, calling his attention to 
 the express condition upon which he had forwarded the check, and 
 that it was sent as payment in full satisfaction of the plaintiff's claim 
 for professional services to date; that he did not recognize the 
 plaintiff's right to retain the amount so offered, and repudiate the 
 condition of the offer ; and requesting the plaintiff either to keep the 
 money upon the condition named, or return it to him by first mail. 
 ' To this letter the plaintiff made no reply, but kept the amount of 
 , the check, and after the expiration of nearly a year brought this ac- 
 tion for the recovery of $270, the balance of his accoimt after ap- 
 plying the $400 received, in which he has recovered the sum of $170, 
 which it was stipulated upon the trial should be the amount of the 
 judgment if he was entitled to recover at all. 
 
 Upon these conceded facts we think it must be held that there was 
 in law an accord and satisfaction of the plaintiff's claim, and that no 
 recovery cOuld be lawfully predicated upon it. It is unquestionably 
 true, as the respondent's counsel contends, and as the general term, 
 in its opinion, very clearly states, that, in order to establish a de- 
 fense of this character, there must be present in the transaction upon 
 which it rests all the elements of a complete agreement, — a lawful 
 subject-matter, a sufficient consideration, and the aggregatio men- 
 tium, or mutual assent, of the parties. The original contract, which 
 the law implied, was an agreement on the part of the defendant to 
 pay the plaintiff what his services were reasonably worth. From 
 the very nature of the case a further agreement must be reached by 
 the parties, fixing the value of the services, or else resort must be 
 had to a judicial determination for that purpose. The plaintiff ac- 
 cordingly sent his bill, in which he expressed his own views as to 
 the amount of compensation which he ought to have. Had the de- 
 fendant retained it without objection^ it would in time have become 
 an account stated, which is a species of implied contract, and the 
 
1008 DISCHARGE OF CONTRACT (Ch, 5 
 
 law would have presumed a promise on his part to pay the sum 
 charged irl' the bill. But the defendant, while not disputing the ren- 
 dition of the services; objected to the amount of the plaintiff's charg- 
 es, and declined to pay the bill rendered, but sent a check for $400, 
 stating that it was to be in full satisfaction of the plaintiff's claim, 
 and in substance expressing the hope that the plaintiff would, upon 
 reflection, agree with him that it was the reasonable value of his 
 services. 
 
 The plaintiff received and used the check, and, had he re- 
 mained silent, it would have been conclusively presumed that, he as- 
 sented to the defendant's proposition, and had agreed to receive, 
 and had received, the sum tendered in discharge of his debt. But 
 the tenor of the defendant's letter was such as to invite a reply, and, 
 while the plaintiff kept the^ check, he sent another bill for the same 
 amount, upon which he credited the amount of the check as a part 
 payment, leaving a balance, which he still claimed to be due. The 
 just inference to be drawn from this communication was that he 
 declined to accept the check in full payment, but had appropriated 
 it as a partial payment of his claim, and the defendant undoubtedly 
 so understood it. Had he then remained silent it might have been 
 presumed that he assented to the use which the plaintiff had made 
 of the check, and in time would have becpme bound to pay the 
 balance, as upon an account stated; but the defendant at once noti- 
 fied the plaintiff that he had sent the check upon condition that if 
 should be received in full payment of his bill, and that he could not 
 assent to any other application of the money, and that the plaintiff 
 must either keep it upon that condition, or immediately return it. 
 It is of no significance in this case that the remittance was by check. 
 Both parties treated it as money, and upon the receipt of this letter 
 the plaintiff had but a single alternative presented for his action, — 
 the prompt restoration of the money to his debtor, or the complete 
 extinguishment of the debt by its retention. The tender and the 
 condition could not be dissevered. The one could not be taken, and 
 the other rejected. The acceptance of the money involved the ac- 
 ceptance of the condition, and the law will not permit any other in- 
 ference to be drawn from the transaction. Under such circum- 
 stances the assent of the creditor to the terms proposed by the 
 debtor will be implied, and no words of protest can affect the legal 
 quality of his act. 
 
 Where the demand is liquidated, and the Jiability of the debtor is 
 not in good faith disputed, a different rule has been applied. In 
 such cases the acceptance of a less sum than is the creditor's due will 
 not, of itself, discharge the debt, even if a receipt in full is given. 
 The element of a consideration is lacking, and the obligation of the 
 debtor to pay the entire debt is not satisfied. There are many au- 
 thorities which enforce this, proposition, but they have no relevancy 
 •to a case Hke the present, where the debt was unliquidated^ and there 
 
Sec. 6) ACCORD EXECUTORY ^ACCORD AND SATISFACTION 1009 
 
 was a bona fide disagreement in regard to the extent of the debtor's 
 liability. The law favors the adjustment of such controversies vyith- 
 out judicial intervention, and' will not permit the creditor to accept 
 and retain money which has been tendered by way of compromise, 
 and then successfully litigate with his debtor for the recovery of a 
 greater sum. There have been some cases in our own courts where 
 this principle has been applied, but in none that we have examined 
 has the question arisen in the exact form here presented. Palmer- 
 ton V. Huxf ord, 4 Denio, 166 ; Looby v. Village of West Troy, 24 
 Hun, 78; Hills v. Sommer, 53 Hun, 392, 6 N. Y. Supp. 469. In 
 other states there are many decisions directly in point, where the 
 facts were not distinguishable from those appearing in this record. 
 McDaniels v. Lapham, 21 Vt. 222 ; Preston v. Grant, 34 Vt. 201 ; 
 Towslee v. Healey, 39 Vt. 522; Boston Rubber Co. v. Peerless 
 Wringer Co., 58 Vt. 553, 5 Atl. 407 ; Bull v. Bull, 43 Conn. 455 ; 
 Potter V. Douglass, 44 Conri. 541 ; Reed v. Boardman, 20 Pick. 441 ; 
 Donohue v. Woodbury, 6 Cush. (Mass.) 148, 52 Am. Dec. Til; Hil- 
 liard v. Noyes, 58 N. H. 312 ; Brick v. Plymouth Co., 63 Iowa, 462, 
 19 N. W. 304; Hinkle v. Railroad Co., 31 Minn. 434, 18 N. W. 
 275. * * * 
 
 To make out the defense, the proof must be clear and unequiv- 
 ocal that the observance of the condition was insisted upon, and 
 must not admit of the inference that the debtor intended that his 
 creditor might keep the money tendered in case he did not assent 
 to the condition upon which it was offered. The defendant here has 
 brought his case clearly within the rule, and is entitled to have the 
 judgments of the general and special terms reversed, and the com- 
 plaint dismissed, upon the stipulated facts, without costs to either 
 party in any court, pursuant to the stipulation in the record. All 
 concur. 
 
 Judgment accordingly.'"' ,' 
 
 WHITTAKER CHAIN TREAD CO. v. STANDARD AUTO 
 
 SUPPLY CO. 
 
 (Supreme Judicial Court of Massachusetts, 1913. 216 Mass. 204, 103 N. E. 
 695, 51 L. R. A. (N. S.) 315, Ann. Cas. 1915A, 949.) 
 
 Action by the Whittaker Chain Tread Company against the Standard 
 Auto Supply Company. On report. Judgment for plaintiff. 
 
 LoRiNG, J. The plaintiff sold and delivered to the defendant goods 
 to the amount of $80.03. The defendant tmdertook to return a part 
 
 =2 Cashing the check does not operate as satisfaction, unless the debtor 
 made it clear that it was tendered as a full settlement. Dimmick v. Banning, 
 Cooper & Co., 256 Pa. 295, 100 Atl. 871 (1917),; Bogert & Hopper v. 
 Henderson Mfg. Co., 172 N. C. 248, 90 S. E. 208. A claim is not unliquidated 
 where there is no real doubt and no dispute in good faith. Clark v. Summer- 
 field Co., .40 E. I. 254, 100 Atl. 499 (1917). 
 
 CORBIN CONT.: — 64 , 
 
1010 DISCHARGE OF CONTEAOT (Ch. 5 
 
 of the goods sold, of the value of $50.02. The plaintifif disputed 
 its right to do so and refused to receive the goods from the teamster 
 through whom the defendant undertook to make the return. While 
 matters were in this condition the defendant sent the plaintiff a check 
 for $30.01, which was admittedly due and which the defendant stated 
 was in full settlement of the account.^ The plaintiff cashed the check 
 and on the following day notified the defendant that it had done so, and 
 demanded payment of $50.02, the balance claimed by it to be due 
 after crediting the amount of the check as a payment on account. The 
 judge found that the defendant had no right to return the goods which 
 it attempted to return, and that the plaintiff was entitled to recover 
 the $50.02 due from them unless it was barred by cashing the check. 
 
 Cases in which debtors have undertaken to force a settlement 
 upon their creditors by sending a check in full discharge of a dis- 
 puted account have given rise to more than one question upon which 
 there is a conflict in the authorities. 
 
 In Day v. McLea, 22 Q. B. D. 610, it was decided by the Court of 
 Appeal in England that a creditor who cashes a check sent in full 
 settlement is not barred from contending that he did not agree to take 
 it on the terms on which it was sent if at the time he accepts it he says 
 that he takes it (5n account. The ground of that decision was that to 
 make out the defence of accord and satisfaction the debtor must prove 
 an agreement by the creditor to take the sum paid in settlement of the 
 account, and that if the creditor in taking the check notifies the debtor 
 that he accepts it on account and that he refuses to accept it in full 
 settlement, the debtor as matter of law has not proved an agreement on 
 the part of the creditor to accept the check in satisfaction of the 
 claim, but that that question must be decided by the jury. This doc- 
 trine is upheld in 17 Harvard L,aw Review, at pqge 469, and in the case 
 of Goldsmith v. Lichtenberg, 139 Mich. 163, 102 N. W. 627. See also 
 in this connection Krauser v. McCurdy, 174 Pa. 174, 34 Atl. 518; 
 Kistler V. Indianapolis & St. Louis R. R., 88 Ind. 460. 
 
 But the true rule is to the contrary. The true rule is put with ac- 
 curacy in Nassoiy v. Tomlinson, 148 N. Y. 326, 331, 42 N. E. 715, 
 716, 51 Am. St. Rep. 695 in these words: "The plaintiff could only 
 accept the money as it was offered, which was in satisfaction of his 
 demand. He could not accept the benefit and reject the condition, for 
 if he accepted at all it was 'cum onere.' When he indorsed and col- 
 lected the check referred to in the letter asking him to sign the in- 
 closed receipt in full, it was the same, in legal effect, as if he had signed 
 and returned the receipt, because acceptance of the check was a conclu- 
 sive election to be bound by the condition upon which the check was 
 offered." And to that effect is the weight of authority." * * * 
 
 68 The court here cited Nassoiy v. Tomlinson, 148 N. T. 326, 42 N. E. 715, 
 51 Am. St. Rep. 695 (1S96) ; Washington Natural Gas Co. v. Johnson, 123 
 Pa. 576, 16 Atl. 799, 10 Am. St. Rep. 553 (1889) ; Partridge Lumber Co. v. 
 Phelps-Burruss Lumber & Coal Co., 91 Neb. 396, 136 N. W. 65 (1912) ; Neely 
 
Sec. 6) ACCORD EXBCUTOET ^ACCORD AND SATISFACTION , 1011 
 
 Indeed the decision in Day v. McLea, ubi supra, was explained 
 by the Court of Appeal in the recent, case of Hirachand v. Temple, 
 [1911] 2 K. B. 330, and made to rest not on the lack of agreement, but 
 on the lack of consideration. 
 
 But in cases (like the case at bar) where there is a dispute as to 
 the amount due under a contract and payment of an amount which 
 he (the debtor) admits to be due (that is to say, as to which there is 
 no dispute) is made by the debtor in discharge of the whole contract, 
 further and other questions arise. 
 
 The question whether the creditor who under these circumstances 
 accepts such a payment, protesting that he takes it on account, is or 
 is not barred, is a question upon which again the authorities are in 
 conflict. It was held in the following cases that a creditor in such 
 a case is barred: ISfassoiy v. Tomlinson, 148 N. Y. 326, 42 N. E. 
 715, 51 Am. St. Rep. 695; Ostrander v. Scott, 161 111. 339, 43 N. E. 
 1089; Tanner v. Merrill, 108 Mich. 58, 65 N. W. 664, 31 E. R. A. 
 171, 62 Am. St. Rep. 687; Neely v. Thompson, 68 Kan. 193, 75 Pac. 
 117; Treat v. Price, 47 Neb. 875, 66 N. W. 834; Hull v. Johnson, 
 22 R. I. 66, 46 Atl. 182 ; Cunningham v. Standard Construction Co., 
 134 Ky. 198, 119 S. W. 765; Pollman & Bros. Coal & Sprinkling 
 Co. V. St. Louis, 145 Mo. 651, 47 S. W. 563.=* See also in this connec- 
 tion Chicago, Milwaukee & St. Paul Ry. v. Clark, 178 U. S. 353, 20 
 Sup. Ct. 924, 44 E. Ed. 1099. But in the following cases it was held 
 that he was not barred: Demeules v. Jewel Tea Co., 103 Minn. 150, 
 114 N. W. 733, 14 L. R. A. (N. S.) 954, 123 Am. St. Rep. 315 ; Seattle, 
 Renton & Southern Ry. v. Seattle-Tacoma Power Co., 63 Wash. 639, 
 116 Pac. 289; Prudential- Ins. Co. v. Cpttingham, 103 Md. 319,. 63 
 Atl. 359. See also in this connection Chrystal v. Gerlach, 25 S. D. 
 128, 125 N. W. 633; Robinson v. Leatherbee Tie & Lumber Co., 
 120- Ga. 901, 48 S. E. 380; Walston v. F. D. Calkins Co., 119 Iowa, 
 150, 93 N. W. 49; Weidner v. Standard Life & Accident Ins. Co., 
 
 T. Thompson, 68 Kan. 193, 75 Pac. IIT (1904) ; Hull v. Jotnson, 22 R. I. 
 66 46 Atl 182 (1900) ; Cunningham v. Standard Construction Co., 134 Ky. 
 198 119 S W. T65 (1909) ; Canton XJnion'Coal Co. v. Parlin & ArendorfC Co., 
 215' 111 244 74 N. E. 143, 106 Am. St. Rep. 162 (1905) ; Petit v. Woodlief, 115 
 N C 120 20 S B. 208 (1894) ; Pollman & Bros. Coal & Sprinkling Co. v. 
 city of St. Louis, 145 Mo. 651, 47 S. W. 563 (1898) ; Potter v. Douglass, 44 
 Conn 541 (1877) ; Cooper v. Tazoo & Mississippi Valley R. R., 82 Miss. 634, 
 35 South. 162 (1903) ; Barham v. Kizzia, 100 Ark. 251, 140 S. W. 6 (1911.) ; 
 Thomas v. Columbia Phonograph Co., 144 Wis. 470, 129 N. W. 522 (1911) ; 
 Sparks V. Spaulding Mfg. Co., 158 Iowa, 491, 139 N. W. 10^ (1913) See also 
 in this connection McDaniels v. President, etc., of Bank of Kutland, 29 Vt. 230, 
 70 Am Dec 406 (1857) ; Button v. Stoddart, 83 Ind. 539 (1882) ; Creighton 
 V. Gregory, 142 Cal. 34, 75 Pac. 569 (1904). .. .. , ^ . ,. n 
 
 See, also, in accord: Beck Electric Const. Co. v. National Contracting Co., 
 143 Minn. 190, 173 N. W. 413 (1919) ; Decker v. George W. Smith & Co., 88 
 N. J. Law, 630, 96 Atl. 915 (1916) ; Anson v. New Tork Life Ins. Co., 252 
 m. 369, 96 N. E. 846, g7 L. R. A. (N. S.) 555 (1911). 
 
 "In accord: Janci t. Cerny, 287 111. 359, 122 N E. 507 (1919) ; Stanley- 
 Thompson Liquor Co. v. Southern Colorado Mercantile Co., 65 Colo. 587, 178 
 Pac. 577, 4 A. L. K. 471 (1919). 
 
1012. DISCHAUGB OF CONTEAOT (Ch. 9 
 
 130 Wis. 10, no S. W. 246; Louisville, N. A. & C. Ry, v. Helm & 
 Bruce, 109 Ky. 388, 59 S. W. 323. 
 
 The decision in most of these cases was made to turn upon the 
 question whether payment of the amount admitted to be due without 
 dispute did or did not constitute a valid consideratioil for the discharge 
 of the balance of the debt about which there was a dispute. If that 
 were the only question involved in the case at bar it would be neces- 
 sary to consider whether Tul;tle v. Tuttle, 12 Mete. 551, 46 Am. Dec. 
 701, is in conflict with the well-settled law of the commonwealth that 
 a promise to pay one for doing that which he was under a prior legal 
 duty to the promisee to do is not binding for want of a valid considera- 
 tion. The cases are collected in Parrot v. ' Mexican Central Ry., 207 
 Mass. 184, 194, 93 N. E. 590, 34 L. R. A. {N. S.) 261. 
 
 Tuttle V. Tuttle, ubi supra, was a case in which the holder of a 
 note made an express agreement to forego a claim which he had made 
 to interest on the note in consideration of payment of the balance 
 of the principal then unpaid. It was a question whether he was entitled 
 to interest, but there was no question of his right to the principal. It 
 was held that this agreement was a bar to any claim for interest on the 
 note. There was no discussion in the opinion as to the lack or valid- 
 ity of a consideration. But the point was involved in the decision. 
 
 In the case at bar there was no express agreement by the creditor 
 to forego the balance of his claim on receiving payment of the amount 
 admitted without dispute to be due. The only way in which such an 
 agreenient can be made out in the case at bar is on the ground that 
 the plaintiff had to take the check sent him on the condition oh which it 
 was sent, and that by cashing the check he elected to accept the con- 
 dition ' and so took the part admittedly due in full discharge of the 
 whole debt. But while the doctrine of election is sound where a check 
 is sent in full discharge of a claim no part of which is admitted to be 
 due, it does not obtain where a debtor undertakes to make payment 
 of what he admits to be due conditioned on its being accepted in dis- 
 charge of what is in dispute. Such a condition, under those circum- 
 stances, is one which the debtor has no right to impose, and for that 
 reason is void. In such a case the creditor is not put to an election to 
 refuse the payment or to take it on the condition on which it is offered. 
 He can take the payment admittedly due free of the void condition 
 which the debtor has sought to impose. Take an example: Suppose 
 the defendant had agreed to deliver to the plaintiff a stipulated quan- 
 tity of iron for a stipulated price during each month of the year, and 
 after six months the market price of iron was double that stipulated 
 for in the contract. Suppose further that the defendant on the seventh 
 month sent the stipulated amount of iron but on condition that the 
 plaintiff should' pay double the stipulated price. _ That is to say, can 
 there be any doubt of the plaintiff's right to retain the iron without 
 paying the double price? That is to say, can there be any doubt that 
 the condition which required the plaintiff to pay double the contract 
 
Sec. 6) ACCOED EXECUTORY — ACCORD AND SATISFACTION 1013 
 
 price for the installment sent was void and that the plaintiff tinder 
 those circumstances is not put to an election but can keep the iron un- 
 der the contract ? There can be no doubt on that question' in oui- 
 opinion; and in our opinion the principle of law governing that case 
 governs the case at bar, where the debtor undertook without right to 
 impose upon a payment of what admittedly was due a void coridition 
 that it be received in full discharge of what was in dispute. 
 
 It follows that in accepting the check in the case at bar as a payment 
 on account, the plaintiff was within its rights and that it has not agreed 
 to accept it in full settlement of the balance of the account. By the 
 terms of the report judgment is to be entered for the plaintiff in the 
 sum of $50.02, with interest -from the 20th day of October, 1911 ; 
 anti it is 
 
 So ordered."* 
 
 LEAVITT et al. v. MORROW. 
 (Supreme Court of Ohio, 1856. 6 Ohio St. 71, 67 Am. Dec. 334.) 
 
 To a declaration in assurnpsit, containing only the common cotmts, 
 the defendant filed the following special plea in bar : * * * "And, 
 for further plea, the said defendants say, that, after the making of 
 said supposed promises in the declaration mentioned, and after the 
 decease of said Wilson, viz : on the 2d day of June, 1852, Jane Wilson, 
 the widow of said Hans Wilson, deceased, and a devisee and legatee 
 under his last will and testament, at the special instance and request of 
 the said ■ plaintiff , and as an accord and satisfaction of his supposed 
 claim against the estate of said Wilson deceased, at said county, caused 
 and procured to be conveyed by William Kelly and Maria his wife, 
 a part of the south half of Section' 11, Township 7, and Range 2, in 
 Jefferson county, to one Benjamin McFarland, a trustee: selected by 
 the said David Morrow, to have and to hold the same in trust for 
 the use of the said David Morrow and Rebecca his wife, during their 
 joint lives and the life of the survivor, and at the death of the survivor 
 of the said David and Rebecca, to convey the estate to the heirs at law 
 of said David Morrow, being the persons who would have taken the 
 same by descent, in the case that said David Morrow had died "seized 
 and intestate. And the said David Morrow then and there accepted 
 the conveyance in trust, in, full accord, satisfaction, and, discharge, of 
 his said supposed claim against the estate of the said Hans Wilson, 
 deceased ; and this they are^ ready to verify- Wherefore they pray 
 judgment," etc. * * * 
 
 A demurrer to this plea was overruled, and on issue joined the ver- 
 
 '" In accord: Manee v. Hossington, 205 N. T. 33, 98 N, E. 203 (1912). 
 
 That acceptance of a part payment cannot operilte ks a discharge, where no 
 dispute exists and the entire debt is liquidated, see Foakes v. Beer, ante, p. 
 320, and note. * 
 
1014 ' DISCHARGE OF CONTRACT (Ch. 5 
 
 diet and judgment were for the plaintiff. The defendant brings writ 
 of error, the lower court having held that settlement by a third person 
 does not operate as a discharge. 
 
 BartIvEy, C. J.^' The main question presented for determinationan 
 this case is whether an accord and satisfaction, accepted in discharge 
 of a debt, but coming from a stranger or person having no pecuniary- 
 interest in the subject-matter, is a legal defense to an action against the 
 debtor, or his legal representatives. ' The charge of the District Court 
 to the jury, was in the negative of this proposition ; and if the court 
 erred in this, the judgment must be reversed; 
 
 It requires powers of discrimination looking far beyond the justice 
 of the case, to see the reason of the rule, that accord arid satisfaction, 
 although moving from a stranger, yet accepted by the creditor, and Set 
 up in the plea of the defendant, as a discharge of the debt, does not 
 constitute a legal defense to the action. It is said, in some of the 
 early adjudications touching this subject, that the reason of the rule 
 is, that the person from whom the accord and satisfaction comes is not 
 privy to the contract giving rise to the debt. This reason might give, 
 just cause to the creditor to refuse to receive the satisfaction from 
 a sti"anger, or third person, not known in the transact;ion of the parties, 
 even as agent of the debtor. But where the creditor has actually re- 
 ceived arid accepted the contribution in satisfaction Of the debt, to 
 allow him to maintain an action on the same debt afterward, would seem 
 to shock the ordinaty sense of justice of every man,. It is urged, in 
 support of the rule, that one man can not make another his debtoi' 
 without his consent; that one man can not make a gift Or dpnation to 
 another, unless the latter consent to receive it ; arid that it may be 
 possible that a debtor may, on account of cross claims, matters of 
 set-off, or in view of other circurilstances, be unwilling that a stranger 
 should step in, and, by voluntary contribution, satisfy the claim of 
 his creditor. 
 
 All this may be very true, and not affect the controversy in 
 this case. And it is said, that exceptions may exist to all' general 
 rules — indeed, that exceptions sometimes prove the rule. It may be laid 
 down as incontestable, as a general thing, that, where one man is 
 indebted to another, and a third person steps in and pays the debt, in 
 the absence of all circumstances tending to show the contrary, the ra- 
 tional inference would be, that the act done, being for the debtor's 
 benefit, was done with his consent, or, if without his knowledge at the 
 time, that it would, as a matter of course, be ratified by him afterward. 
 If in such a case, the creditor should subsequently bring suit against the 
 debtor, and the debtor should appear in the action, and plead the satis- 
 faction in discharge of .his liability, I can not conceive upon what 
 just and rational ground the creditor could be allowed to reply, thaj: his 
 debt was not discharged, because the satisfaction which he had accepted 
 
 =« The statement of facts is abridged and a pa/t of the opinion Is omitted. 
 
Sec. 6) ACCORD EXECUTORY ^ACCORD AND SATISFACTION 1015 
 
 in discharge of it was without the consent of the defendant. The very 
 fact of the satisfaction being set up in the action, by the defendant, in 
 discharge of the debt, would, of itself, seem sufficient to conclude the 
 plaintiff f^om denying that it had received the defendant's consent, or 
 ratification. 
 
 It is claimed, however, on, behalf of the defendant in error, that 
 the question, in this case, depends upon a rule of law which was decided 
 many years ago, and which has been recognized and acquiesced in, by 
 the sages of the law, for nearly two hundred years ; that the common 
 law settles the question — which has been fined and refined by an in- 
 finite number of grave and .learned men, through a succession of ages, 
 until, by long experience, it has grown to such perfection, that, in the 
 language of Lord Coke, "no man of his own private reason, ought to 
 be wiser than the law." It is true, that the doctrine, that an accord and 
 satisfaction, moving from one who was a stranger, and in no sort privy 
 to the condition of the obligation, could not be pleaded in bar by the 
 obligor, which was reported by Croke to have been laid down in 
 Grymes v, piofield, Cro. Eliz. 541, and which appears to have been 
 affirmed in Edgecomb v. Rodd and others, 5 East's Rep. 294, and rec- 
 ognized as law in some of the other English decisions, as well as in 
 some of the elementary books, and abridgments, has been tollowed in 
 a number of the reported cases in this county. In the case of Clow 
 V. Borst et al., 6 Johns. (N. Y.) 38. and the case of Stark's Adm'r v. 
 Thompson's Ex'r, 3 T. B. Mon. (Ky.) 303, the rule appears to have 
 been adhered to ; and in the case of Daniels v. Hallenback, 19 Wend. 
 (N. Y.) 410, it was recognized with some qualification. 
 
 But mere precedent, alone, is not sufficient to settle and establish 
 forever a legal principle. Infallibility is to be conceded to no human 
 tribunal. A legal principle, to be well settled, must be founded on 
 sound reason, and tend to the purpose of justice. The maxim com- 
 munis error facit jus, has a limited application. Otherwise, it could 
 never be said, that law is the perfection of reason, and that it is the 
 reason and justice of the law which give to it its vitality. When we 
 consider the thousands of cases to be pointed out in the English and 
 American books of reports, which have been overruled, doubted, or 
 limited in their application, we can appreciate the remark of Chancel- 
 lor Kent in his Commentaries, vOl. 1, page 477, that "Even a series of 
 decisions are not always evidence of what the law is." Precedents are 
 to be regarded as the great store-house of experience; not always to 
 be followed, but to be looked to as beacon lights in the progress of 
 judicial investigation, which, although, at times, they may be liable 
 to conduct us to the' paths of error, yet, may be important aids in light- 
 ing our footsteps in the road to truth. * * * 
 
 From an examination of the whole subject, it appprs that the case 
 of Grymes v. Blofield, as reported, by Croke, in which the doctrine 
 originated that a plea of accord and satisfaction, moving from a 
 
1016 DISCHARGE OF CONTRACT (Ch. 5 
 
 stranger, was not a good plea in bar, is, to say the least of it, of doubt- 
 ful authority ; and, in the cases in which it has been followed, both in 
 England and in this country, it appears to have been adopted with 
 little or no inquiry into the reason or justice of its application. The 
 r,ule laid down is purely technical; and the reason assigned, that the 
 stranger is not privy to the condition of the obligation, loses all its 
 reality when we consider that the satisfaction must have been accept- 
 ed by the plaintiff, and assented to, or ratified by the defendant. It 
 would seem therefore, that a rule which, in its tendency, is calculated 
 to foster bad faith and defeat the purposes of justice, ought not to be 
 adhered to, simply on account of its antiquity. 
 
 We are unanimous in the opinion that there was error in the in- 
 structions of the District Court to the jury. 
 
 Judgment reversed, and cause remanded for further proceedings."' 
 
 SIGLER V. SIGLER. 
 ■ / 
 (Supreme Court of Kansas, 1916. 98 Kan. 524, 158 Pac. 864, L. R. A. 
 
 1917A, 725.) 
 
 Action by Ode Sigler agaipst Joseph Sigler. Erom the judgment, 
 the plaintiff appeals, and defendant files a cross-appeal. Affirmed. 
 
 PoRTBR, J. The action in the district court was to recover an al- 
 leged indebtedness. There were three causes of action, but the error 
 complained of relates to the third cause of action, which was upon a 
 promissory note. The jury returned a verdict in plaintiff's favor and 
 made a number of findings of fact. The court approved the findings, 
 but sustained defendant's motion for judgment on the pleadings, evi- 
 dence, and findings, and this is the ruling we are asked to review. 
 
 The answer admits the execution of the note, but alleges that plain- 
 tiff is not the owner or holder of it; that prior to the commencement 
 of the action he had sold, assigned, and delivered to one C. M. Hutch- 
 ison the note, together with a mortgage given to secure its payment, 
 
 ^'' In spite of the early decision in Grymes v. Blofield, Cro. Eliz. 541 (1594), 
 a payment by a third person operates as an accord and satisfaction, if so 
 accepted by the creditor and approved later by the debtor. It will so operate 
 even though the debt due is liquidated and the sum paid Is less than the sum 
 due. Crmnlish's Adm'r v. Central Imp. Co., 38 W. Va. 390, 18 S. E. 456, 23 
 L. R. A. 120, 45 Am. St. Rep. 872 (1893) ; .Jackson v. Pennsylvania R. Co., 66 
 N. J. Law, 319, 49 Atl. 730, 55 L. R. A. 87 (1901) ; Marshall v. BuUard, 114 Iowa, 
 462, 87 N. W. 427, 54 L. E. A. 862 (1901) ; Cunningham v, Irwin, 182 Mich. 629, 
 148 N. W. 786 (1914) ; Sigler v. Sigler, 98 Kan. 524, 158 Pac. 864, L. E. A. 
 1917A, 725 (1916) ; Ex parte Zeigler, 83 S. C. 78, 64 S. E. 513, 21 L. R. A. 
 (N. S.) 1005 (1909), and note. Contra: Gordon Malting Co. v. Bartels Brew- 
 ing Co., 206 N. y. 528, lOO N. E. 457, 461 (1921). 
 
 If the debtor gives in payment of his debt the note of a third person, the 
 creditor may take this note either as an absolute satisfaction or only as a 
 conditional one. In the latter , ease, if the note is not paid when due the 
 creditor can maintain suit against his original debtor. Cheltenham Stone 
 & Gtavel Co. v.' Gates Iron Works, 124 111. 623, 16 N. E. 923 (1888). 
 
Sec. 6) ACCOED EXECUTORY — ^ACOOED AND SATISFACTION 1017 
 
 and that thereafter defendant paid the note, and that the mortgage 
 had been canceled and delivbred to him by the holder; that the plain- 
 tiff had retained the moneys received by him for the sale of the, note 
 and had never tendered or offered to return the same. The reply ad- 
 mitted the execution, delivery, and assignment of the note and mort-, 
 gage, but alleged that C. M. Hutchison's name wras not written in the 
 assignment of the mortgage at the time it viras delivered, and that the 
 transfer and assignment were made under the following circumstanc- 
 es : Defendant employed one R. C. Wilson to purchase the note and 
 mortgage for him as cheaply as possible, and agreed to provide a fund 
 amounting to $1,200 or more with which to make the purchase; that 
 tliereupon Wilson, concealing from plaintiff the fact that he had been 
 employed by and was acting for the defendant, negotiated with plain- 
 'tiff for the purchase of the note and mortgage, and falsely and fraud- 
 ulently represented to plaintiff that they were of very little value and 
 would be difficult to collect ; that the plaintiff believed these false rep- 
 resentations and relied upon them ; and that Wilson, for and on behalf 
 of defendant, paid the plaintiff $400, and that plaintiff under these cir- 
 cumstances executed the assignment and delivered the note and mort- 
 gage to Wilson. The reply further alleged that the whole transaction 
 amounted in |aw to nothing more than the payment of $400 on the 
 note, for which plaintiff in his petition had given defendant credit. It 
 further alleged that Wilson wrote in the name of Hutchison as as- 
 signee, in order that Hutchison might make a formal release of the 
 mortgage. The jury found that plaintiff accepted the $400 on Wil- 
 son's representations to the effect that the note and mortgage were of 
 very little value and would be very difficult of collection, that Wilson 
 knew at that time that defendant had made arrangements for the pay- 
 ment or purchase of the note, and that plaintiff believed and relied 
 upon the statements. 
 
 As already observed the trial court approved these findings of fact, 
 bat held that the note had been paid and discharged by the transac- 
 tion. The plaintiff relies upon the rule that an agreement to accept 
 part in satisfaction of the whole of a liquidated demand is invalid be- 
 cause witliout consideration. Bridge Company v. Murphy, 13 Kan. 
 ^5; St. L., Ft. S. & W- R- Co. v. Davis, 35 Kan. 464, 11 Pac. 421. 
 The reason for the rule is that there is no consideration for the release 
 of the remainder of the debt, as the debtor gives no more than he is 
 bound to give, and the creditor accepts no more than he is entitled to 
 receive. The rule is said to have had its origin in a dictum in the 
 English Court of Common Pleas (Pinnel's Case, 5 Coke's K. B. 117). 
 Although it is universally recognized by courts and text-writers, it has 
 been criticized, as technical, artificial, and having no foundation in 
 reasoning. Brooks and Another v. White, 43 Mass. (2 Mete.) 283, 
 285, 37 Am. Dec. 95; Bolt v. Dawkins, 16 S. C. 198, 214. In a num- 
 ber of states it has been entirely abrogated or modified by statute. 
 Courts generally refuse to apply the rule where the technical reasons 
 
1018 DISCHARGE OF CONTEAOT (Ch. 5 
 
 for doing so do not exist (Brooks and Another v. White, supra ; Har- 
 per V. Graham, 20 Ohio, 105, 115), and have recognized numerous ex- 
 ceptions to it, for instance, the payment of a part before due, or at a 
 place other than that where the obligor was legally bound to pay, or a 
 payment in property, regardless of its value, or by the debtor in com- 
 position with his creditors generally by which they agree t^ accept, less 
 than is due them, is held to create a consideration which is suflicient. 
 The rule quite generally followed is that any additional consideration, 
 however small, will support the new agreement, provided only it be 
 such that in law it is sufficient to support an ordinary contract and 
 consist of something which the debtor was not legally bound to do or 
 give. Bryant v. Proctor, 53 Ky. (14 B. Mon.) 451. Thus it has been 
 held that the payment of a debt, or any part of the debt, before it is 
 due is something which the debtor is not under legal obligation to do, 
 and therefore furnishes a legal consideration for a contract to release 
 or cancel a debt ; and any new consideration moving from the debtor 
 toward the creditor will take the agreement out of the operation of the 
 rule. 1 C. J. 544, 545. It is well settled that the courts will refuse 
 to inquire into the adequacy of the consideration if there be any that 
 will support an ordinary contract. Hastings v. Lovejoy, 140 Mass. 
 261, 2 N. E. 776, 54 Am. Rep. 462. It is said that the additional con- 
 sideration may consist of anything which might be a burden to the one 
 party or a benefit to the other. 1 C. J. 541. One established excep- 
 tion to the rule is that payment by a third person of a sum less than the 
 amount due, with the understanding that it shall be in full payment, is 
 held to be an accord and satisfaction. 
 
 A very thorough discussion of the subject of accord and satisfac- 
 tion will be found in an elaborate note in 100 Am. St. Rep. 390-456. 
 The author of the note, referring to the technical distinction drawn by 
 the earlier cases, says : "The strictness of the rule undoubtedly work- 
 ed many hardships in preventing a creditor, who needed the money, 
 from making an accord and satisfaction with his debtor or in prevent- 
 ing a debtor who might be temporarily embarrassed from settling with 
 his creditor for less than the fixed amount of his debt. Hence the 
 courts, though bound by precedents, from time to time enlarged the 
 exceptions to the rule, so that now the exceptions might almost be said 
 to form the rule itself." Page 430 of 100 Am. St. Rep. 
 
 There was great lack of harmony in the earlier decisions on the 
 question whether part payment made by a stranger to the transaction 
 to which it relates could be pleaded as accord and satisfaction. The 
 English and many of the early American cases held that a satisfaction 
 given by a stranger is not good because he is in no respect a privy to 
 the original contract. The leading English cases to that effect are 
 Grymes v. Blofield, 1 Croke's (39 Eliz.) 541, and Edgcombe v. Rodd 
 and Others, 1 Smith, 515, 5 East, 294. The doctrine of Grymes v. 
 Blofield, was followed in the United States by Clow v. Borst, 6 Johns. 
 (N. Y.) 2:7, :.nd by a number of other courts. [The court here dis- 
 
Sec. 6) ACCORD EXECUTOKT — ACCORD AND SATISFACTION 1019 
 
 cussed Leavitt and Lee v. Morrow, 6 Ohio St. 71, 67 Am. Dec. 334; 
 Jackson v. Pennsylvania R. R. Co., 66 N. J. Law, 319, 49 Atl. 730, 55 
 L. R. A. 87, and Crumlish's Adm'r v. Cent. Imp. Co., 38 W. Va. 390, 
 18 S. E. 456, 23 L. R. A. 120, 45 Am. St. Rep. 872.] 
 
 • No cases have been cited in the brief which involved facts at all sim- 
 ilar to the case at bar. Our own research has resulted in finding but 
 two cases which are at all analogous. In Shaw v. Clark, 6 Vt. 507, 27 
 Am. Dec. 578, where a judgment debtor furnished the money to a 
 third person to purchase a judgment from the creditor who accepted 
 a less sum than the face of the judgment, it was said in the opinion: 
 "As the sum paid was really the money of the debtor and paid over by 
 his agent it is the same as if paid by himself." Page 508 of 6 Vt., 27 
 Am. Dec. 578. The court held it to be quite obvious that the act of a 
 debtor in furnishing funds to a third person to buy up his debts at a 
 discount is so far fraudulent as to render the sale voidable at the elec- 
 tion of the creditor. This case was decided in 1856. 
 
 A case to the contrary is Gordon v. Moore, 44 Ark. 349, 51 Am. 
 Rep. 606, where the facts were in some respects similar to those in the 
 present case, and it was held that an agreement by a creditor to ac- 
 cept from a third person, in behalf of the debtor, a smaller sum in 
 satisfaction of the whole is valid and binding and will discharge the 
 debt. In the opinion it was said that the consideration is that the cred- 
 itor gets, or is assured of getting, what perhaps the debtor might nev- 
 er pay, and that "it cannot alter the nature of the case that the debtor 
 repaid the advance." * * * 
 
 From the foregoing authorities it seems firmly established that a 
 debtor may authorize and employ a third person as his agent to make 
 a satisfaction of his debt ; that where he does so, and the money is ad- 
 vanced by the third party and accepted by the creditor in satisfaction 
 of the debt, it is a good accord and satisfaction. This is so even where 
 the third party makes the payment without the debtor's knowledge, if 
 the latter afterward ratify the action. Did the concealment by Wilson 
 of the fact that he was acting for the defendant destroy the effect of 
 the payment, or, in other words, must there be knowledge on the part 
 of the creditor that the payment is made on behalf of the debtor be- . 
 fore it will constitute an accord and satisfaction? It was held that 
 an accord and satisfaction is : "The result of an agreement between 
 the parties, and, like all other agreements, must be consummated by a 
 meeting of the minds of the parties, accompanied by a sufficient con- 
 sideration. If the creditor is to be held to abate his claim against the 
 debtor, it must be shown that he understood that he was doing so when 
 he received the claimed consideration therefor." Harrison v. Hender- 
 son, 67 Kan. 194, 200, 72 Pac. 875, 62 L. R. A. 760, 100 Am. St. Rep. 
 386. And 'in Matheney v. El Dorado, 82 Kan. 720, 109 Pac. 166, 28 L. 
 R. A. (N. S.) 980, it was ruled that : "To constitute an accord and sat- 
 isfaction, the agreement that a smaller sum shall be accepted in dis- 
 charge of a larger one originally claimed must have been entered into 
 
1 020 DISCHAKGB OF CONTRACT (Ch. 5 
 
 by the parties understandingly and with unity of purpose." Syl. 
 par. 1. 
 
 But the extent of the doctrine there declared is merely that the 
 smaller sum must not only have been offered, but it must have been 
 accepted with the understanding that it was in full satisfaction of the 
 larger amount claimed. The plaintiff certainly understood that he 
 was accepting the $400 in full satisfaction of all his interest in the 
 note and mortgage. It is difficult to see how his rights were affected 
 in the slightest by his failure to know and understand that Wilson was 
 acting as the agent of the debtor, because, as we have seen, the weight 
 of authority is that a payment of a part by a stranger, who may have 
 acted without the knowledge or consent of the debtor, will, if accepted 
 by the creditor and afterwards ratified by the debtor, constitute a full 
 accord and satisfaction. * * * 
 
 Judgment affirmed."* 
 
 SECTION 7.— DISCHARGE OF SPECIALTIES 
 
 NO YES V. HOPGOOD. 
 
 (In the King's Bench, 1622. Cro. Jae. 649.) 
 
 Debt upon an obligation for eighty pounds, conditioned for the per- 
 formance of divers covenants .contained in articles of agreement. 
 The defendant pleaded, that it was agreed betwixt the plaintiff and 
 the defendant that he should grant an annuity of five pounds out of 
 such land for life, in discharge of that bond ; which grant he made ac- 
 cordingly, and the plaintiff accepted it in discharge of that bond, &c. — 
 Whereupon it was demurred; and, without argument, upon the first 
 motion adjudged for the plaintiff; for it is but a concord and verbal 
 agreement, which can never be a discharge of a specialty.^" 
 
 ALDEN V. BLAGUE. 
 
 (In the Common Pleas, 1605. Oro. Jac. 99.) 
 
 Covenant. For that the lessee covenanted for him and his assigns 
 to repair and maintain the houses in reparations from time to time 
 during the term ; and shews that the lessee assigned all his term to the 
 
 08 Part of the opinion is omitted. Tlie court held that there was no fraud. 
 
 59 In accord: Mitchell v. Hawley. 4 Denio (N. Y.) 414, 47 Am. Dec. 2G0 
 (1847), accord and satisfaction not a good plea in an action on a debt of 
 record; Spence v. Healey, 8 Exch. C88 (1853), where Martin B., said: "I am 
 sorry that I am compelled to agree in hcildlng that the plea is bad. It is 
 difficult to see the correctness of the reasons on which the rule is founded." 
 
Sec. 7) DISCHARGE OF SPECIALTIES 1021 
 
 defendant; and for default of reparations after the assignment, he 
 brought the action against the assignee. The defendant pleads, that 
 after the decay he made such a cOncord, that the plaintiff should have 
 thirty shillings and such goods in satisfaction of that destruction, &;c. 
 and shews it to be executed. Whereupon it was demurred, and moved 
 for the plaintiff, that it was not any plea ; for the action being ground; 
 ed upon a deed, cannot be discharged unless by deed ; as an obligation 
 with a condition cannot be discharged by a contract. 
 
 But all the Court held, that the plea was good enough ; for it is not 
 pleaded in discharge of the covenant, but only for the damages which 
 are demanded by reason of the breach of the coveinant, and the cove- 
 nant remains : and this plea sounds only in discharge of the defend- 
 ant, and is not like to the case of an obligation ; for there it is a duty 
 certain; and it is not any plea, although it be before or after the day 
 of payment : and in every action where only amends is demanded by 
 way of damages, "accord executed" is a good bar in discharge of them. 
 Vide 3 Hen. 6 pi. 17. 3. Hen. 4. pi. 1, 47 Edw. 3. pi. 12. Dyer, 
 75. and 201. 
 
 Daniel said, that in waste against tenant for years, "accord" is a 
 good plea, but not against tenant for life. And afterward in the prin- 
 cipal case it was adjudged accordingly, that it was a good bar.*" 
 
 STEEDS et al. v. STEEDS et al. 
 (In the Queen's Bench Division, 1889. 22 Q. B. Div. 537.) 
 
 Wills, J.®^ The plaintiffs in this case sue for a sum of money al- 
 leged to be due for principal and interest on a bond made in their fa- 
 vour by the two defendants. 
 
 One of the defendants pleads that he delivered to one of the plain- 
 tiffs certain stock and goods which were given by him and accepted by 
 the said plaintiff in satisfaction and discharge of the money due upon 
 the bond. The other defendant pleads that he executed the bond as 
 surety and was discharged by the transaction set up by the first de- 
 fendant. 
 
 The plaintiffs apply to have this defence struck out, as being no an- 
 swer to their claim. The same question arises as to both defendants, 
 . and is shortly whether in respect of a bond given by C. to A. and B., 
 accord and satisfaction made by C. to A. after the cause of action had 
 arisen, and accepted by A., is an answer to the claim of A. and B. 
 
 On behalf of the plaintiffs two objections are raised. 1. That in re- 
 spect of a specialty debt, accord and satisfaction of the cause of ac- 
 tion by the person or persons liable is no more an answer to the action 
 in equity than it is at law. 2. That even if it would be so, were the 
 
 8 "In accord: Blake's Case, 6 Co. 43b (1605). 
 
 «i The statement of facts and part of the opinion are omitted. 
 
1022 DISCHARGE OF CONTEACT (Ch. 5 
 
 bond made in favour of A. alone, accord and satisfaction with A. is 
 no answer in equity to the action by A. and B. 
 
 It is clear that at law accord and satisfaction of a debt due upon a 
 bond is no bar to the action. This is, however, purely the result of a 
 technicality absolutely devoid of any particle of merits or justice, viz., 
 that a contract under seal cannot be got rid of except by performance 
 or by a contract also under seal ; so that supposing it had really been 
 the case that in satisfaction of an overdue bond for ilOOO the person 
 liable had given property worth £2000, which had been accepted in dis- 
 charge of the obligation, still at law the obligee of the bond might re- 
 cover his £1000 without returning the property. 
 
 One would have thought that if the Courts of Equity ever inter- 
 fered at all to prevent a man from enforcing an imconscientious and 
 dishonest demand to which there was no answer at law, they would 
 perpetually restrain an action brought under the circumstances de- 
 scribed. Mr. Wood, however, who is an equity lawyer, contended be- 
 fore us that this was a case in which equity would follow the law, and 
 would refuse to interfere, and he laid great stress upon a case of Webb 
 V. Hewitt, 3 K. & J. 438, which he said established that proposition. 
 We are glad to say that we are unable to agree with him, and that we 
 think he has done injustice tO a system of which one recommendation 
 has been supposed to be that it was, sometimes at all events, compe- 
 tent to correct some of the worst and most odious technicalities of the 
 common law. The case cited appears to us to lead to the opposite con- 
 clusion to that contended for, and we think it perfectly clear that the 
 ratio decidendi of the learned Vice-Chancellor was, that when the 
 plaintiff had accepted money's worth in place of money in discharge 
 of the bond, the debt in equity was gone and there was an end of 
 
 J^ * * * 62 
 
 FORTESCUE v. BROGRAVE. 
 
 (In the King's Bench, 1647. Style, 8.) 
 
 The plaintiff brings an action for breach of covenant upon a deed. 
 The defendant pleads a parol agreement afterwards, in discharge of 
 the former covenant ; but the Court held the plea not good, and took 
 these differences, that a parol agreement before a breach of it, may 
 be discharged by parol, and so pleaded ; after a breach it cannot be 
 pleaded in discharge without satisfaction also pleaded : but a dis- 
 charge may be pleaded by deed be the covenant by parol or by deed 
 after a breach, and without satisfaction. 
 
 «2 The court then held that in equity a /discharge agreed to by one of two 
 joint obligees did not necessarily operate to discharge the claim of the other 
 obligee. 
 
 See, also, Boiinger v. Tuyes, 120 U. S. 198, 205, 7 Sup. Ot. 529, 30 L. Ed. 
 649 (1886) J Savage v. Blanchaird, 148 Mass. 348, 19 N. B. 396 (1889). 
 
Sec. 7) DISCHAEQE OF SPECIALTIES 1023 
 
 HERZOG V. SAWYER. 
 (Court of Appeals of Maryland, 1883. 61 Md. 344.) 
 
 AlvEy, C. J., delivered the opinion of the Court. 
 This action is brought' on a sealed instrument, dated the 28th of 
 January, 1881. * * * 
 
 The articles of agreement sued on provides, that the plaintifiE should 
 serve the defendants as a member of a company organized to give en- 
 tertainments throughout the United States and the Canadian Provinces, 
 the State of California excepted, for the term of one year, commenc- 
 ing the 7th of March, 1881, and ending March 6th, 1882; that the 
 plaintiff should give his eritire entertainment, known as the "Musical 
 Glasses," for the sole benefit and emolument of the defendants, during 
 the term specified, and should at all times hold himself in readiness to 
 perform the duties required. And for the sei-vices thus to be per- 
 formed the defendants covenanted to pay the plaintiff the sum of 
 $25 per week, his board at hotels, or other places, and the expenses of 
 transportation, &c. ; the weekly wages to be paid on Monday of each 
 week. 
 
 The declaration, after setting forth the terms of the agreement, al- 
 leges that the plaintiff entered the service of the defendants under the 
 agreement, at the time specified, and fully and faithfully performed 
 all the duties required of him, until he was^ without cause, discharged 
 therefrom, after about five weeks' service; and that the defendants 
 failed and refused to employ him, as agreed in the premises, for the 
 remainder of the term, and failed and refused to pay him as agreed up- 
 on for the remainder of the time specified in the agreement, although 
 he, the plaintiff, was at all times- ready, able and willing to serve the 
 defendants, and perform all the duties required of him hy the agree- 
 ment; wherefore he says he has sustained great loss, damage, and 
 injury, and he claims, &c. 
 
 To this declaration, the defendant Herzog pleaded, 1st. Non est 
 factum; 2d. Payment; 3d. That the contract declared on had been 
 mutually rescinded; and, 4th. That the contract had been abandoned 
 by both plaintiff and defendant. Upon these pleas issues were joined, 
 and the case was tried before the court, without the assistance of a jury. 
 
 Evidence was offered by the plaintiff to prove * * * that the 
 undertaking to give the exhibitions contemplated by the agreement 
 was abandoned by the defendants, after about fifteen weeks' service 
 by the plaintiff, and that the latter was discharged from employment 
 without his fault. He also proved that he was ready, able, and will- 
 ing to perform the agreement on his part, but was prevented by the 
 abandonment of the exhibitions by the defendants. 
 
 On cross-examination the plaintiff admitted that, on the 20th of 
 Feb. 1882, he entered into a new engagement with the defendants, to 
 perform the same or similar services for them to those required of him 
 
1024 DISCHARGE! OF CONTEAOT (Ch. 5 
 
 under the contract sued on, but for different compensation; and that 
 he did perform such services under the contract of Feb. 20th, 1882, 
 and was f ujly paid therefor. 
 
 The defendant offered evidence to prove that the exhibitions had 
 been given up and abandoned upoii the suggestion and by the advice 
 of the plaintiff himself, and that all claim by him, under the contract 
 sued on, had been fully adjusted and discharged. 
 
 There were several propositions of law submitted to the court; and 
 while those on the part of the plaintiff were accepted, all those on 
 the part of the defendant, except one, were rejected. 
 
 The controverted and controlling legal propositions involved, and 
 presented by the prayers; are reducible to two ; *. * * 2d. Whether 
 it be competent to show by parol evidence, that the contract sued on, 
 being a contract under seal, was abandoned or rescinded by the mutual 
 consent of the parties thereto, or that, its performance by the defend- 
 ants was waived by the plaintiff. * * * "^ 
 
 2. As to the second question. It is certainly true, as a general 
 principle, that at the common law, for what would appear to be pure- 
 ly technical reasons, an obligation under seal cannot be discharged 
 before breach by an agreement in parol, or by any instrument not ex- 
 ecuted with the same solemnity as the original obHgation. All author- 
 ities, however, agree, that after breach, for the damages occasioned 
 thereby, any agreement or transaction between the parties that would 
 operate as an accord and satisfaction in ordinary cases, may be 
 pleaded in discharge. Harper v. Hampton, 1 Har. & J. 675 ; Kaye 
 V. Waghom, 1 Taunton, 428; 1 Chitt. PI. (16th Ed.) 515, 516. But 
 this distinction is extremely technical, and in many cases it has been 
 found to operate injustice ; and, consequently, in many of the courts of 
 this country the rule has been, to a considerable extent, modified. And 
 it has been held repeatedly, that whenever the breach complained of 
 has been superinduced by the action or agreement of the plaintiff, and 
 the matter is properly availed of in defence, he will not be allowed to 
 recover on the technical breach thus produced. The tendency of all 
 courts at this day is to prevent circuity of action, and to discourage the 
 assertion of claims founded upon merely technical grounds; and 
 whenever it is apparent that it would be unjust, and in violation of 
 good faith, to allow .the plaintiff to recover by means of a technical 
 advantage, the Courts are always strongly inclined to amplify the 
 scope of the defence to the fullest extent possible, in order to prevent 
 injustice being done. It was from this strong tendency of the courts 
 that we have many well reasoned cases in the reports which go to 
 modify, to a considerable extent, the technical rule of exclusion in ques- 
 tion. Of the many cases upon the subject, those most frequently 
 'referred to are Fleming v. Gilbert, 3 Johns. (N. Y.) 528; Dearborn 
 V. Cross, 7 Cow. (N. Y.) 48; Langworthy v. Smith, 2 Wend. (N. Y.) 
 
 «s Part of the optnion, not dealing with the second question, is omitted. 
 
Sec. 7) DISCHARGE OP SPECIALTIES 1025 
 
 587, 20 Am. Dec. 652; and the principle of the decisions in those 
 cases was fully adopted by this court in the case of the Franklin 
 Fire Ins. Co. v. Hamill, 5 Md. 170, 182. * * * 
 
 The principle of the decision in Fleming v. Gilbert has not only been 
 fully approved and followed by this Court in 5 Md. 182, but it has been 
 followed in many other cases, and has but recently been cited with 
 api>roval by the Supreme Court of the United States, in the case of the 
 Chesapeake Co. 'v. Ray, 101 U. S. 522, 527, 25 L. Ed. 792. That ten- 
 der of performance, or waiver of performance, of a condition or cove- 
 nant under seal may be shown by Jjarol evidence, was expressly held 
 in the case in 5 Md. 170; and waiver or abandonment is what was 
 sought to be shown in this case. 
 
 If, therefor, it be found that the plaintiff did advise the suspension 
 or abandonment of the entertainments or exhibitions contemplated by 
 the agreement sued on, and that they were so abandoned with the plain- 
 tiff's assent; and that the plaintiff afterwards, but within the time 
 covered by the original agreement, made a new engagement with the 
 defendants to perform the same or similar services, on different terms, 
 -r-such conduct on the part of the plaintif&avould amount to a waiver or 
 abandonment of the original agreement, and would constitute a good 
 • defence to the action. And it follows that this court is of opinion 
 that there was error in the court below in excluding the parol evidence 
 of such waiver and abandonment; such evidence being pertinent and 
 admissible under the issues joined. The various propositions offered 
 at the trial, inconsistent with the principles herein maintained, should 
 have been rejected. We shall reverse the judgment and award a 
 new trial. 
 
 Judgment reversed, and new trial awarded."* 
 
 ** A parol contract which undertakes to discharge or vary a specialty is 
 /effective if acted upon. Munroe v. Perkins, 9 Pick. (Mass.) 298, 20 Am. Dec. 
 475 (1830) ; McCreery v. Day, 119 N. Y. 1, 23 N. E. 198, 6 L. E. A. 503, 16 Am. 
 St. Eep. 793 (1890) ; McKenzie v. Harrison, 120 N. Y. 260, 24 N. E. 458, 8 L. 
 R. A. 257, 17 Am. St. Rep. 638 (1890) ; Stees v. Leonard, 20 Minn. 494, Gil. 448 
 (1874) ; Yockey v. Marion, 269 111. 342, llO N. E. 34 (1915). Some jurisdic- 
 tions uphold the new contract while still executory. Chesapeake & O. R. Co. 
 V. Ray, 101 U. S. 522, 25 L. Ed. 792 (1879) ; Hastings v. Lovejoy, 140 Mass. 
 261, 2 N. E. 776, 54 Am. Rep. 462 (1885). But others refuse to give effect to 
 an unexecuted variation of a sealed instrument unless the new agreement 
 is also under seal. McKenzie v. Harrison, supra; McMurphy v. Garland, 
 47 N. H. 316 (1867). 
 
 COEBIN CONT 65 
 
1025 DISCHARGE OF CONTRACT (Ch. R 
 
 SECTION 8.— ALTERATION 
 
 WOOD V. STEELE. 
 
 (Supreme Court of the United States, 1867. 6 Wall. 80, 18 L. Ed. 725.) 
 
 Error to the Circuit Court for the District of Minnesota. 
 
 Mr. Justice SwaynE dehvered the opinion of the court. 
 
 The action was brought by the plaintiiif in error upon a promis- 
 sory note, made by Steele and Newson, bearing date October 11th, 
 1858, for $3720, payable to their own order one year from date, 
 with interest at the rate of two per cent, per month, and indorsed 
 by them to Wood, the plaintiff. 
 
 Upon the trial it appeared that Newson applied to Allis, the agent 
 of Wood, for a loan of money upon the note of himself and Steele. 
 Wood assented, and Newson was to procure the note. Wood left 
 the money with Allis to belaid over when the note was produced. 
 The note was afterwards delivered by Newson, and the money paid 
 to him. Steele received no part of it. At that time, it appeared on ■ 
 the face of the note, that "September" had been stricken out and "Oc- 
 tober 11th" substituted as the date. This was done after Steele 
 had signed the note, and without his knowledge or consent. These 
 circumstances were unknown to Wood and to Allis. Steele was 
 the surety of Newson. It does not appear that there was any con- 
 troversy about the facts. The argument being closed, the court in- 
 structed the jury, "that if the said alteration was made after the 
 note was signed by the defendant, Steele, and by him delivered to the 
 otljier maker, Newson, Steele was discharged from all liability on 
 said note." The plaintiff excepted. The jury found for the de- 
 fendant, and the plaintiff prosecuted this writ of error to reverse 
 the judgment. Instructions were asked by the plaintiff's coun- 
 sel, which were refused by the court. One was given with a modifi- 
 cation. Exceptions were duly taken, but it is deemed unnecessary 
 particularly to advert to them. The views of the court as expressed 
 to the jury, covered the entire ground of the controversy between 
 the parties. 
 
 The state of the case, as presented, relieves u'g from the neces- 
 sity of considering the questions, — ^upon whom rested the burden 
 of proof, the nature of the presumption arising from the alteration 
 apparent on the face of the paper, and whether the insertion of a 
 day in a blank left after the month, exonerates the maker who has 
 not assented to it. 
 
 Was the instruction given correct? 
 
 It was a rule of the common law as far back as the reign of Ed- 
 ward III, that a rasure in a deed avoids it. The effect of alterations 
 
■Sec. 8) ALTERATION 1027 
 
 in deeds was considered in Pigot's Case, 11 Coke, 27, and most of 
 the authorities upon the subject down to that time were referred 
 to. In Master y. Miller,, 4 Term R. 320, 1 Smith, Lead. Cas. 1141, 
 the subject ,was elaborately examined with reference to commercial 
 paper. It was held that the estabhshed rules apply to that class of 
 securities as well as to deeds. It is now settled, in both English 
 and American jurisprudence, that a material alteration in any com- 
 mercial paper, without the consent of the party sought to be charg- 
 ed, extinguishes his liability. The materiality of the alteration is 
 to be decided by the court. The question of fact is for the jury. 
 The alteration of the date, whether it hasten or delay the time of 
 payment, has been iiriiformly held to be material. The fact in this 
 case that the alteration was made before the note passed from the 
 hands of Newson, cannot affect the result. He had no authority to 
 change the date. 
 
 The grounds of the discharge in such cases are obvious. The 
 agreement is no longer the one into which the defendant entered. 
 Its identity is changed;- another is substituted without his consent; 
 and by a. party who had no authority to consent for him. There 
 is no longer the necessary concurrence of minds. If the instriiment 
 be under sealj he may well plead that it is not his deed ; and if it be 
 not under seal that he did not so promise. In either case, the issue 
 must necessarily be found for him. To prevent and punish such 
 tampering, the law does not permit the plaintiff to fall back upon the 
 contract as it was originally. In pursuance of a stern but wise pol- 
 icy, it annuls the instrument, as to the party sought to be wronged. 
 
 The rules, that where one of two innocent persons must suffer, 
 he who has put it in the power of another to do the wrong, must 
 bear the loss, and that the holder of commercial paper taken in 
 good faith and in the ordinary course of business, is unaffected by 
 any latent infirmities of the security, have no application in this class 
 of cases. The defendant could no more have prevented the altera- 
 tion than he could have prevented a complete fabrication; and he 
 had as little reason to anticipate one as the other. The law regards 
 the security, after it is altered, as an entire forgery with respect to 
 the parties who have not consented, and so far as they are con- 
 cerned, deals with it accordingly. 
 
 The instruction was correct and the judgment is affirmed."' 
 
 85 In Pigot's Case, 11 Coke, 26b (1614) it was held that the interlineation by 
 a stranger of mere descriptive words after the name of the obligee In a bond 
 was an immaterial alteration not affecting the validity of the bond; but it 
 is further said "that when any deed is altered in a point material,, by the 
 plaintiff himself, or by any stranger, without the privity of the obligee, be it 
 by irtterlineation, addition, raising, or by drawing of a pen through a line, 
 or through the midst of any material word, that the deed thereby becomes 
 void. * * * So if the obligee himself alters the deed by any of the said 
 ways, although it is in words not material, yet the deed is void; but if a 
 stranger, without his privity, alters the deed by any of the said ways in any 
 point not material, it shall not avoid the deed." 
 
1028 DISCHARGE OF CONTBACT (Ch. 5 
 
 BOWMAN V. BERKEY et al. . 
 (Supreme Court of Pennsylvania, 1918. 262 Pa. 411, 105 Atl. 557.) 
 
 Assumpsit on a note by Polly. A. Bowman against Jerry Berke'y 
 and another Verdict for plaintiff for $3,219.99, and, from a judg- 
 ment for defendants n. o. v., plaintiff appeals. Affirmed. 
 
 Per Curiam. The addition of a seal after the signature of W. S. 
 Krise to the note involved in the issue below, without his knowl- 
 edge or authority, was a "material alteration" ' of the instrument. 
 Bowman v. Berkey et al., 259 Pa. 327, 103 Atl. 49. The seal was 
 added by the admitted agent of the plaintiff, and the learned trial 
 judge in directing the , entering of judgment for the defendants n. 
 o. V. properly admitted that their point asking for the direction of a 
 verdict in their favor should have been affirmed. 
 
 Judgment affirmed." 
 
 JAMES v. TILTON. 
 ( Supreme Judicial Court of Massachusetts^ 1903. 183 Mass. 275, 67 N. B. 326.) 
 
 Action by James against Tilton. There was a finding for plaintiff, 
 and defendant brings exceptions. Exceptions overruled. 
 
 Morton, J.*^ This is an action to recover upon a promissory note, 
 the plaintiff being the holder, and the defendant the maker. * * * 
 
 The principal question is whether there was a material alteration 
 of the note. * * * 
 
 The exceptions recite that, as originally drawn, the note was pay- 
 able to "Irving A. Evans and John C. Watson or order." The copy 
 of the note attached to the amended declaration reads : "Irving A. 
 Evans, John C. Watson (and George B. James) or order." But, 
 from the allegations contained in the declaration, it would seem 
 that this is a mistake, the declaration alleging that "the defendant 
 made a promissory note * * * payable to Irving A. Evans and 
 John C. Watson or order," of which a copy is annexed. It appeared 
 that the plaintiff was a member of a firm consisting of himself and 
 the said Evans and Watson, and that the business of the firm was 
 carried on under the name and style of Irving A. Evans and John 
 C. Watson. The note in suit was given to the firm in part payment of 
 property purchased of the firm, and on a winding up of the partner- 
 ship was turned over to the plaintiff as part of his share of the as- 
 sets. At or about the time of his receiving the note the plaintiff, 
 without the knowledge or consent of the defendant, drew a line with 
 ink through the words "Irving A. Evans and John C. Watson," 
 and inserted his own name as payee. Thereafter Watson, at the 
 
 «« In accord: Davidson v. Cooper, 11 M. & W. 778 (1843). 
 «T Part of the opinion is omitted. 
 
Sec. 8) ALTERATION 1029 
 
 plaintiff's request, made the following indorsements on the back 
 of the note: "Pay to the order of George B. James. John C. Wat- 
 son. Pay to the order of George B. James. I. A. Evans, by John 
 C. Watson." This was the condition of the note at the commence- 
 ment of the action. After the action was begun, the plaintiff, with- 
 out the consent or knowledge of the defendant, restored the face of 
 the note to its original condition by erasing his own name as payee, 
 and the line that he had drawn through ithe names of Evans and 
 Watson, and the declaration was amended accordingly. The note 
 as thus restored, with marks and indications of alterations on its 
 face, was offered in evidence and admitted, against the objection of 
 the defendant that it had been materially altered, and that there was 
 marks and indications of alterations on its face. 
 
 The court found that the plaintiff was in law and in fact one of 
 the payees of the note, that the alteration was not fraudulent, and 
 that there had not been any material alteration of the note, and re- 
 fused to rule, as requested by the defendant, either generally that 
 the plaintiff could not recover, or that, if the names of the payees 
 or of either of them was erased after the delivery of the note, or if 
 another name was written in as payee after delivery, he could not 
 recover, or that it was immaterial that the note had been restored 
 by still further erasures, to it& original condition. 
 
 We think that the rulings and refusals to rule were right. The 
 note as altered, taken in connection with the indorsements by Ev- 
 ans and Watson, expressed no more than the actual legal liability of 
 the defendant at the time of the alteration. The most that can be 
 said is that Evans and Watson were originally named as payees, and 
 that by the alteration the plaintiff became payee, and therefore the 
 effect of the instrument as originally drawn was changed. But the 
 court has found that the alteration was not fraudulent, and that the 
 plaintiff was in law and in fact a payee of the note. It must have 
 found that the alteration was innocently made or was made by mis- 
 take. The insertion of his own name simpliciter would not have 
 constituted a material alteration, siijce it did not change in any re- 
 spect what was already the legal effect of the note. Aldous v. 
 Comwell (1868) E. R. 3 Q. B. 573. And we are of opinion that, if 
 the plaintiff innocently or by mistake drew a line through the names 
 of Evans and Watson and inserted his own name in place thereof, 
 and neither the defendant nor any third party has suffered any in- 
 jury in consequence thereof, nor can be injured if the note is re- 
 stored to its original condition, it could be so restored by the plain- 
 tiff, and that the alteration would in that case become immaterial. 
 Lee V. Butler, 167 Mass. 426, 46 N. E. 52, 57 Am. St. Rep. 466; 
 Church V. Fowle, 142 Mass. 12, 6 N. E. 764; Nickerson v. Swett, 
 135 Mass. 514; Drum v. Drum, 133 Mass. 566; Ames v. Colburn, 
 11 Gray, 390, 71 Am. Dec. 723; Adams v. Frye, 3 Mete. 103; Nev- 
 ins V. De Grand, 15 Mass. 436; Horst v. Wagner, 43 Iowa, 373, 
 
1030 DISCHARGE OF CONTRACT (Ch. 5 
 
 22 Am. Rep. 255 ; Kountz v. Kennedy, 63 Pa. 187, 3 Am. Rep. 541 ; 
 Rogers v. Shaw, 59 Cal. 260. 
 
 The case differs from Stoddard v. Penniman, 108 Mass. 366, 11 
 Am. Rep. 363, relied on by the defendant. In that case the effect 
 of the alteration was to change the liability of the defendant from 
 that of an indorser to that of an original promisor. So in Fay v. 
 Smith, 1 Allen,' 477, 79 Am. Dec. 752, Draper v. Wood, 112 Mass. 
 315, 17 Am. Rep. 92, and Greenfield Sav. Bank v. Stowell, 123 Mass. 
 196, 25 Am. Rep. 67, the effect of the alteration in each case was to 
 enhance the liability of the defendant. 
 
 The alteration having been, found to be- immaterial, the action 
 was rightly permitted to proceed on the note in its original condi- 
 tion, and the introduction of the note in evidence in its original con- 
 dition was riglitly permitted. 
 
 Exceptions overruled.'* 
 
 SECTION 9.— ARBITRATION AND AWARD— MERGER ; 
 
 JOHNSON V. RAWLE. 
 (At Nisi Prius, before RoU, J., 1648. Aleyn, 90.) 
 
 In an action upon a promise, the defendant pleaded a submission of 
 all matters in difference to arbitrament, and an award; &c. the plaintiff 
 denied the submission modo & forma, and issue being joyned there- 
 upon, the evidence was of a submission of all matters touching ac- 
 compts, and allowed good evidence; and because the 'plaintiff could 
 not 'prove that there were other matters in difference, but matters of 
 accompt, 'he was non-suited. Hale and Mainard being of his counsel. 
 
 88 Alteration by a stranger to the contract, and without the privity of the 
 holder, is now generally held not to operate as a discharge. Gould v. Gould, 
 99 Wash. 204, 169 Pac. 324 (1917) ; Clyde S. S. Co. v. Whaley, 231 Fed. 76, 
 145 C. C. A. 264, L. R. A. 1916F, 289 (1916) ; Nichols v. Johnson, 10 Conn. 
 192 (1834) ; Gleason v. Hamilton, 188 N. Y. 353,- 84 N. B. 283, 21 L. R. A. 
 210 (1893) ; 2 Cyc. 151, 152. See N. I. L. § 124. 
 
 Alteration by the holder, even though not with fraudulent intent, generally 
 operates as a discharge, if the alteration is material and intentional.^ There 
 is some variation as to what is material. See Wheelock v. Freeman, 13 Pick. 
 (Mass.) 165, 23 Am. Dec. 674 (1832), time of payment accelerated; Master 
 
 V. Miller, 4 T. R. 320, 1 Sm. L. C. (1791) ; Holbart v. Lauritson, 34 S. U. 
 
 267, 148 N. W. 19 (1914), with extended note in L. R.' A. 1915A, 166, name of 
 payee in a note changed; Burchfield v. Moore, 3 El. & Bl. 683 (1854), place 
 of payment added to an acceptance of a bill of exchange ; Gray v. Williams, 
 91 Vt. Ill, 99 Atl. 735, words written on margin of a note reserving a lien on 
 the goods sold. See, further. United States v. Spalding, 2 Mason, 478, Fed. 
 Cas. 16,365 (1822) ; 2 Cyc. 193-225. 
 
 Alteration by accident or mistake does not discharge. Wilkinson v. John- 
 son, 3 B. & C. 428 (1824) ; Brett v. Marston, 45 Me. 401 (1858) ; Russell v. 
 Longmoor, 29 Neb. 209, 45 N. W. 624 (1890) ; 2 Cyc. 146. 
 
Sec. 9) ARBITRATION AND AWARD^ — MERGER 1031 
 
 WILLIAMS et al. v. BRANNING MFG. CO. 
 
 (Supreme Court of North Carolina, 1910. 153 N. C. 7, 68 S. E. 902, 31 L. R. 
 A. [N. S.] 679, 138 Am. St. Rep. 637, 21 Ann. Cas. 954.) 
 
 Action by J. T. Williams and others against the Branning Manu- 
 facturing Company. From a judgment for plaintiffs, defendant ap- 
 peals. Reversed. 
 
 Civil action for damages for breach of contract in writing in which 
 plaintiffs obligated for certain consideration to operate defendant's 
 lumber plant at Ahoskie, in Hertford county, and to cut into logs the 
 standing timber of defendant and manufacture them into lumber at 
 said plant. In October, 1904, these parties entered into another con- 
 tractj modifying and changing some of the provisions of the contract 
 of 1901. In the contract of 1904 the following provision is incor- 
 porated: "Sec. 9. It is further understood and agreed, in the event 
 of any future misunderstanding or disagreement between the parties 
 hereto as to the. contract of Mlarch 1, 1901, of as to any modifications 
 of the same herein contained, that the matter shall be settled by ar- 
 bitrators, to be selected, one by the Branning Manufacturing Com- 
 pany and one by the said J. T. Williams & Bro., and the third by the 
 two, who shall hear and determine the same, and whose award shall 
 be accepted as final between the parties and faithfully performed by 
 each." Disagreements having arisen the matters in controversy were 
 submitted to arbitrators on February 20, 1906, in accordance with 
 the agreements. After the controversy had been heard by the ar- 
 bitrators, but before they rendered their award, to wit, January 1, 
 1907, this action was commenced to recover the damages for the 
 breach of the aforesaid contract. It is admitted in the "facts agreed" 
 that the several matters of difference submitted to arbitration are 
 those set out in the complaint in this action, which complaint was 
 not filed until January 18, 1908. It is admitted in the case agreed 
 "(5) that said arbitrators thereafter, on the 25th day of January, 
 1907, rendered their award, passing on the matters submitted to 
 them, and shortly thereafter the same was sent to plaintiffs and de- 
 fendant, and which the plaintiffs ignored." The cause was submitted 
 at spring term, 1910, superior court of Hertford county to his honor, 
 Judge Ward, who rendered judgment for plaintiffs. The defendant 
 appealed. 
 
 Brown, J. It is unnecessary to review the conclusion of the supe- 
 rior court that the provision in the contract agreeing to submit all mat- 
 ters of difference to arbitration is no bar to this action, for the reason 
 tliat the plaintiffs and defendant did voluntarily submit such matters 
 to arbitration in manner and form as provided in the contract and the 
 arbitrators in due time rendered their award. It is common learning 
 that a valid award operates as a final and conclusive judgment as be- 
 
1032 DISCHARGE OF CONTRACT (Ch. 5 
 
 tween the parties to the submission, or within the jurisdiction of the 
 arbitrators, respecting all matters determined and disposed of by it." 
 
 But it is contended that the fact that a summons in thig action was 
 issued some days before the rendering of the award revoked the sub- 
 mission, and deprived the arbitrators of the right to make an award. 
 No other form of revocation is contended for. At common law a sub- 
 mission might' be revoked by any party thereto at any time before the 
 award was rendered. Bacon, Abridgement, Arb. B; Comyns, Dig. 
 Arb. D, 5 ; Vinyors' Case, 8 Coke, 82. Some courts of this country 
 have held to the contrary (Berry v. Carter, 19 Kan. 135, and cases 
 cited), but this court has followed the doctrine of the common law 
 (Tyson v. Robinson, 25 N. C. 333; Carpenter v. Tucker, 98 N. C. 316, 
 3 S. E. 831). The revocation, to be effective, must be express, un- 
 less there is a revocation by implication of law, and, in case of express 
 revocation, in order to make it complete, notice must be given to the 
 arbitrators. It is ineffective until this has been done. Allen v. Wat- 
 son, 16 Johns. (N. Y.) 205 ; Brown v. Leavitt, 26 Me. 25l ; Morse on 
 Arb. & Award, p. 231: Vin. Ab. Authority, E. 3, 4; Vinyors' Case, 
 supra ; 2 Am. & Eng. 600. 
 
 It is contended that commencing an action is a revocation by legal 
 implication. Such revocations arise from the legal effect of some in- 
 tervening event happening after submission, either by act of God, or 
 caused by the party, and which necessarily puts an end to the, busi- 
 
 «» On a later appeal, 154 N. C. 205, 70 S. E. 290, 47 L. R. A. (N. S.) 337 
 (1911), the court held that the the award was conclusive only as to the 
 matters actually submitted to the arbitrators, and that the original agree- 
 ment to arbitrate all disputes and differences did not bar this present action 
 insofar as it was to enforce claims not passed upon in the award rendered. 
 
 An award of arbitrators, rendered after a proper hearing, is conclusive 
 as to all matters actually submitted and passed upon. It merges the original 
 cause of action in much the same way as does the judgment of a court (but 
 no writ of execution can be obtained without first getting judgment on the 
 award). Smith v. Johnson, 15 East, 218 (1812) ; Scrivner v. McClelland (Okl.) 
 168 Pae. 415 (1917) ; Spencer v. Dearth, 43 Vt. 98 (1870), "an award is as 
 conclusive on the matter included in the submission, as a judgment would be." 
 See 47 L. K. A. (N. S.) 442, note (XXVIII, c.) ; 5 C. J. 160, 168. 
 
 Debt lies upon a valid award, but not upon mutual promises to perform an 
 award. Sutcliflte v. Brooke, 14 M. & W. 855 (1845). 
 
 In an action of debt for tolls due (£60), a plea of an arbitration and an 
 award that the sum was only £13, without alleging payment, was held a 
 bad plea. Allen v. Milner, 2 Or. & J. 47 (1831). This seems to have been 
 because debt was a proper form of action both before the award and after 
 it. The award would limit the recovery to £13. See, also, Second Soc. of 
 Universalists in Town of Boston v. Royal Ins. Oo., Limited, 221 Mass. 518, 
 528, Ann. Gas. 1917E, 491 (1915) ; Commings v. Heard, L. R. 4 Q. B. 669 
 (1869). 
 
 Where a contract makes a valuation by appraisers a condition precedent 
 and makes it conclusive, such valuation does not operate as an award. It 
 does not discharge or merge the prior claim, for there was no enforceable 
 claim until after the appraisal. Suit thereafter is not upon the appraisal as 
 an award, but must be brought upon the original contract. Garred v. Macey, 
 10 Mo. 161 (1846). And see Noble v. Grandin, 125 Mich. 383, 84 N. W. 465 
 (1900) ; California Annual Conference of M. E. Church v. Seitz, 74 Cal. 287, 
 15 Pac. 839 (1887). 
 
Sec. 9) ARBITRATION AND AWARD — MERGER 1033 
 
 ness. The death of a party or arbitrator, marriage of a feme sole> 
 lunacy of a party, or the utter destruction and final end of the subject- 
 matter are of this description. But whether the bringing of an action 
 for the subject-matter of an arbitration after submission and before 
 award is an implied revocation is a matter about which the courts 
 differ. In New York it is held that it is no revocation in law. Lum- 
 ber Co. V. Schneider (Com. PI.) 1 N. Y. Supp. 441 ; Smith v. Compton, 
 20 Barb. 262. To same effect are thel decisions in New Jersey and 
 Vermont. Knaus v. Jenkins, 40 N. J. Law, 288, 29 Am. Rep. 237; 
 Sutton V. Tyrrell, 10 Vt. 91. The courts of Kentucky, Illinois, 
 Georgia, and New Hampshire hold the contrary. Peters v. Craig, 6 
 Dana, 307 ; Paulsen v. Manske, 24 111. App. 95 ; Leonard' v. House, 
 IS Ga. 473 ; Kimball v. Gilman, 60 N. H. 54. The conclusion of Judge 
 Collamer in the Vermont case is that "the entry and continuance of 
 an action was obviously not an express revocation, nor was it such 
 an act as put an end to the subject-matter of the submission, nor did 
 it prevent the arbitration from proceeding with effect. It occasioned 
 the defendant no cost, and, indeed, it was no more than an ordinary 
 act of caution to keep the action in existence, should the opposite 
 party revoke or decline to attend. This, then, was not a revocation 
 in law." Nevertheless, it is plainly deducible from all the cases that 
 the action when conimenced must' cover the subject-matter submitted 
 to arbitration ; otherwise, it cannot be construed as a revocation or 
 notice to the other party or to the arbitrators. In the case at bar the 
 summons was issued some days before the award was made, but the 
 complaint was not filed until a year after. The summons gave no in- 
 dication as to the character ofi the action except that it was a civil 
 action. Until a complaint is filed, the defendant has no legal notice 
 of the cause of action, and the arbitrators had a right to proceed, with 
 the pending arbitration and to render their award. Assuming that 
 the bill of particulars furnished upon defendant's demand is notice 
 of the character of the action, that was not furnished until after Au- 
 gust 1, 1908, several months after the, award had b^en rendered. 
 
 It is further contended that the award is not warranted by the- 
 tenns of submission. According to the written contract and the terms 
 of the submission, the purpose of the award was to ascertain the dam- 
 ages accruing by reason of: "(1) The percentage of miscuts and 
 .stained lumber. (2) As to excess cost of , railroading, (3) As to 
 excess cost of handling lumber on the yard. . (4) Are J. T. Williams 
 & Bro. responsible for fire which occurred last fall, supposedly orig- 
 inating from sparks from locomotive No. 7 ? The above items cover 
 all disputes and contentions under said contract to date." In their 
 written award th^ arbitrators appear ;to have carefully confined them- 
 selves to the questions submitted,' and to have confiined their findings 
 to the four matters in dispute. But it is unnecessary to discuss, that 
 contention further as it is expressly admitted in the case agreed that 
 
1034 DISCHARGE OF CONTRACT (Ch. 5 
 
 the arbitrators on January 25, T907, rendered their award, ' "passing 
 on the matters submitted to them." 
 
 In view of this admission in the record, it is not now open to plain- 
 tiff to attack the award. 
 
 The judgment of the superior court upon the "case agreed" is re- 
 versed. 
 
 PEOPLE ex rel. UNION INS. CO. et al. v. NASH et al. 
 
 (Court of Appeals of New York, 1888. Ill N. Y. 310, 18 N. B. 630, 2 L. R. 
 A. 180, 7 Am. St. Kep. 747.) 
 
 Motion by the people of the state of New York on the relation of 
 the Union Insurance Company of Philadelphia, and the Insurance 
 Company of the State of Pennsylvania, for a peremptory mandamus 
 to compel Stephen P. Nash, John R. Read, and James E. Carpenter, as 
 arbitrators under a certain arbitration agreement, dated October 10, 
 1885,; to proceed thereunder. Motion denied, and petitioners appealed 
 to the supreme court, where the order was affirmed, and they appeal. 
 Code Civil Proc. N. Y. § 2383, referred to in the opinion, reads as 
 follows : "A submission to arbitration, made either as prescribed in 
 this title or otherwise, cannot be revoked by either party after the 
 allegations and proofs of the parties have been closed, and the matter 
 finally submitted to the arbitrators for their decision." 
 
 Gray, J. The position taken by the appellants with respect to the 
 agreement of arbitration in question here is that the character of rev- 
 ocahility, inherent in such subinissions, is affected by that article of the 
 agreement which provides against any revocation, and expressly waives 
 and abandons the right to revoke. They do not dispute the common- 
 law f"ule that submissions to arbitration are revocable in their nature; 
 and, indeed, that such was the rule is too well established and recog; 
 nized by early and late English cases and by the New York statutes 
 and decisions to admit of dispute. Allen v. Watson, 16' Johns. 205 ; 
 Bank V. Widner, 1 1 Paige, 529, 43 Am. Dec. 768 ; 2 Rev. St. N. Y. 
 p. 544, § 23 ; Tobey v. County of Bristol, 3 Story, 800, Fed. Cas. No. 
 14,065 ; Vynior's Case, 8 Coke, 81a; Marsh v. Bulteel, 5 Barn. & Aid. 
 508; In re Rouse, L. R. 6 C. P. 212; Eraser v. Ehrensperger, 12 Q. 
 B. Div. 310. Whatever may have been decided elsewhere in this coun- 
 try, we are satisfied that that is the better rule of law which has been 
 recognized in England and in this state, and which considers a sul> 
 mission revocable until its nature is changed by legal enactment, as 
 was ' done by English statutes. As it was said in Vynior's Case, 8 
 Coke, 81a, "man cannot by his act make such authority, power, or 
 warrant not countermaUdable which is by the law or its own na- 
 ture counterm^ndable ;" hfe cannot "make that irrevocablfe which is of 
 its own nature revocable." But, the learned counsel for the appellants 
 say, the facts underlying this submission, in the discontinuance of suits, 
 
Sec. 9) ARBITRATION AND AWARD— MERGER 1035 
 
 ,the abandonment of advantages, and the peculiar and "unusual agree- 
 ments contained in this submission, by which the right to revoke is 
 waived and abandoned, take it out of the common-law statute rule. 
 They say that here was an express waiver of the right to revoke, 
 based on a valuable and executed consideration ; and they argue that, 
 failing the reason of the rule, the rule itself fails. No unusual char- 
 acter is imparted to the agreement by its being based on such a con- 
 sideration. All such agreements must be based on a good considera- 
 tion; and if the discontinuance of the pending suits and the loss of. 
 advantages thereby occasioned are the features which constitute the 
 executed consideration, they are but the incidents of the agreement of 
 submission. That was the decision of this court in McNulty v. Solley, 
 95 N. Y. 242, where Danforth, J., collects authorities to sustain the 
 proposition that by submission to arbitration eo acto the discontinuance 
 of the pending litigation is effected. 
 
 The flaw in the argument of appellant's counsel is in its assumption 
 that the character of the mandate to the individuals selected to deter- 
 mine the controversy between parties can be changed by their private 
 -agreements, or affected by the circumstances which were its producing 
 cause, or Which the execution of the agreement induced. The soturce 
 of the mandate or power by virtue of which the arbitrators act is in 
 the private agreement which the parties have entered into, for- reasons 
 satisfactory to themselves, in order to have an end to dispute and to 
 legal strife, and the force of the mandate to them is in the consent of 
 the parties that they shall act. But in the execution of the power, or 
 in the thing they are to accomplish, the arbitrators have no interest, 
 and thus the case is altogether different from one where the mandatory 
 has an interest in the execution of the power, and in the result of its 
 exercise. In such a case the mandate which goes forth with the exe- 
 cution and delivery of the agreement to the mandatory becomes ir- 
 revocable. jiVe ai'e at a loss to understand how the nature of the 
 agreement between the parties, or any resulting incident of that, agree- 
 ment, adds anything to the power of the arbitrators. The agreement 
 of submission is executory until the controversy is completely ended 
 -between the parties by the submission to the arbitrators of the con- 
 troversial facts for their decision ; and not till then can it be said that 
 the agreement has been executed and passed beyond the power of the 
 parties to withdraw from or to break. Until that ultimate stage has 
 been reached every article of the agreement which relates to the future 
 conduct of the parties lies in the region of promise; and that prom- 
 ises can be and are broken,, regardless of their weight or the conse- 
 quences, is as proverbial as it is certain. The express agreement not 
 to revoke is executory, of course, like every other agreement to do or 
 not to do a certain thing. Although the parties agreed not to revoke 
 the fact is that one of them has done so, notwithstanding his agree- 
 ment, and, the other is left to such legal remedies as may offer them- 
 selves to protect or compensate him for the breach. The agreement 
 
1036 DISCHARGE OF CONTRACT (Ch. 5 
 
 .to waive any light to revoke does not help the situation. A waiver, to 
 be effectual and beyond recall, must be of some present existing right, 
 conferred by statute or otherwise. When the agreement to waive re- 
 lates to the future conduct of the party, it is purely executory, and 
 amounts to nothing more than the agreement not to revoke. The diffi- 
 culty is that, as the arbitrators have no interest in the result of the ar- 
 bitration, and derive their power to act from the continuing consent of 
 the parties to the agreement, when the agreement, while yet executory, 
 is broken by the refusal of a party to be bound by it or to perform it, 
 the foundation of the arbitrator's power is gone, and they have no 
 more authority over the withdrawing party to bind him by their acts. 
 
 The legislature of this state, in enacting section 2383 of the Code of 
 Civil Proceedure, have set at rest any existing conflict in the decisions, 
 and have enlarged the rule as recognized in the previous statutory 
 enactment. 2 Rev. St. p. 544, § 23. By its provisions a submission to 
 arbitration, whether made as prescribed in that title or otherwise, may 
 be revoked at any time before the closing of the proofs and the final 
 submission of the cause for decision. The revocation must be in writ- 
 ing, signed by the parties, and delivered to the arbitrators, and it is 
 competent for one of several parties on a side to effect such a revoca- 
 tion. We perceive no reason for qualifying the force of this section 
 in the way suggested by appellants' counsel, who say that it is only 
 available to a party when revocation is allowable ; and as, by express 
 agreements in this submission, the right of revocation was stipulated 
 away, the provisions of the section are inapplicable. We think the lan- 
 guage of this section is broad enough to cover all cases of submission, 
 and that the only restriction is as to the time and the mode of the act 
 of revocation. And as to the agreement not to revoke, as we have 
 suggested, like any other agreement relating to the future conduct of 
 parties, it was executory, and, if broken, left the other party helpless 
 thereunder, and under the necessity to seek redress for thg breach else- 
 where. We have preferred to express our views upon the main ques- 
 tion, as to this submission, in view of its importance, and, while doubt- 
 ing the power of the court to compel by writ of mandamus the 
 performance by these arbitrators of their functions, we do not now ex- 
 press any opinion upon that question. 
 
 For the reasons expressed we think the order of the general term 
 affirming the order of the special term denying a motion for a peremp- 
 tory mandamus should be affirmed, with costs. All concur.''* 
 
 '"> See 5 C. J. 53, and 47 L. R. A. (N. S.) 400, note (XVIII), collecting 
 many cases on the power to revoke the power of arbitrators previously ap- 
 pointed. That such a revocation may nevertheless be a breach of duty, giv- 
 ing a right to damages, see the same note, page 408 (XIX) and 5 C. J. 61; the 
 power to revoke may exist without the legal privilege of exercising it. Of 
 course, both power and privilege exist in those cases where the agreemeM 
 to arbitrate is held invalid as an attempt to oust the courts of jurisdiction.. 
 
 Statutes exist in some jurisdictions making an.agreerdent to arbitrate irrev- 
 ocable and providing that a judgment may be entered on the award after 
 
Sec; 9) abbitbation and award — meegbb 1037 
 
 Y. B. 3 HENRY IV, 17, pi. 14. 
 
 Action of debt for £20 on a contract. 
 
 Reade (for defendant) said that as to £10 the defendant had execut- 
 ed his sealed obligation as to the same contract, and asked judgment. 
 Culpeper (for pliaintifiF) said : We have sued on a contract, and as 
 to it you have replied nothing, wherefore we demand our debt and 
 damages ; to this he alleges no law requiring us to reply, for it might 
 well be that he owes us. £10 on an obligation for different reasons, 
 and if it is for the sa;ne cause he should wage his law. Reade : You 
 do not deny that the obligation is for the same contract, and by the 
 , execution of the obligation we are discharged from the contract ; all 
 this we allege, and therefore demand judgment. Culpeper : I suppose 
 that if the obligation should be destroyed or lost, we should never- 
 theless have an action on the contract. 
 
 Markham, J., denied this, and said that it would be adjudged to be 
 your own folly in that you had not taken better care of the instrument. 
 
 Culpeper then said that the obligation was executed for another 
 cause and not for the same contract, and did not say for what cause. 
 Reade then alleged that it was for the same cause; and issue was 
 joined.'^ 
 
 notice witliout bringing an action on the award. See Dickie Mfg. Co. v. 
 Sound Construction & Engineering Co., 92 Wash. 316, 159 Pac. 129 (1916). 
 A recent New York statute (Laws 1920, c. 275 [Consol. Laws, c. 72] § 2) "de- 
 clares a new public policy and abrogates an ancient rule." "A provision in a 
 written contract to settle by arbitration a controversy thereafter arising 
 between the parties, to the contract, or a submission hereafter entered into of 
 an existing controversy to arbitration pursuant to title 8 of chapter 17 of the 
 Code of Civil Procedure, shall be valid, enforceable, and irrevocable, save upon 
 such grounds as exist at law or in equity for the revocation of any contract." 
 See Herman Berkovitz v. Arbib & Hoiilberg, 230 N. Y. 261, 130 N. B. 288 
 (1921). 
 
 "If I am bound by (sealed) obligation to abide by the award of J. S., I 
 cannot revoke this agreement to arbitrate, because I am under obligation; 
 but it is otherwise if it was without (sealed) obligation." T. B. 5 Edw. 
 IV, 3, 2. 
 
 ■^1 Where the parties and the subject-matter are identical, a simple contract 
 is discharged by a subsequently executed sealed obligation-. Higgens' Case, 
 6 Co. 45b (1605) ; Holmes v. Bell, 3 M. & G. 213 (1841) ; Clifton v. Jackson 
 Iron Co., 74 Mich. 183, 41 N. W. 891, 16 Am. St. Rep. 621 (1889) ; Schoon- 
 maker v. Hoyt, 148 N. Y. 425, 42 N. E. 1059 (1896) ; Slocum v. Bracy, 55 
 Minn. 249, 56 N. W. 826, 43 Am. St. Hep. 499 (1893) ; Cavanaugh v. Cassel- 
 man, 88 Cal. 543, 26 Pac. 515 (1891) ; Stockton v. Gould, 149 Pa. 68, 24 Atl. 
 160 (1892). 
 
 Newton, C. J., said in 1444 (Y. B. 22 Hen. VI, 55, 32) : If one buy a horse 
 of me for ten jwunds, and deliver me a bond for ten pounds for the contract, 
 it is a good bar in an action of debt, and, as regards the debt, is as strong 
 as a release for all manner of actions." See Thayer on the Parol Evidence 
 Rule, 6 Harv. L. Rev. 330. In a subsequent "action of debt upon the contract 
 the obligor can wage his law with a good conscience because by the taking 
 of the obligation the contract was discharged." Dalison, 53 (1563). 
 
 In Brook's New Oases, 47, title Contract, it is said that there is a merger 
 "if the obligation be made for parcell of the contract which is entire. 3 Hen. 
 
1038 DISCHARGE OF CONTRACT , (Ch. &. 
 
 VAN yUET et ,al. v. JONES et-al. 
 (Supreme Court of New Jersey, 1845. 20 N. J. Law, 340, 43 Am. Dec. 633.) 
 
 This was a certiorari to the common pleas of Hudson county .to re- 
 move certain proceedings,, had in that court, under the "Act to secure 
 to creditors an equal and just division of the estates of debtors, who 
 convey to assignees for the benefit of creditors." 
 
 The facts of the case appear in the opinion of the court deliver- 
 ed by 
 
 Randolph, J.'' ^- * * * The case according to the papers, is this : 
 Some time prior to December, 1841, Samuel Bridgart of Hudson 
 county, made an assignment for the benefit of his creditors, amongst 
 whom were the plaintiffs in certiorari, Van Vliet and Wikoff, who filed 
 their account pursuant to law, amounting to $2103 ; to whichr Jones and 
 the other defendants in certiorari, who were also applying creditors 
 of Bridgart, filed their exceptions ; and this claim and the exceptions 
 thereto coming before the court of common pleas for trial, neither 
 party demanding a jury, the court disallowed the account on the ground 
 that Van Vliet and Wikoff had taken a bond and mortgage of Bridgart 
 f or tlie -saine account. Although there is much, discrepancy as to what 
 was proved before the court, fortunately as to this bond and mortgage, 
 both the statements and affidavits substantially agree; and from these 
 sources it appears to have been proved before the court below, that 
 Bridgart had an account with the plaintiffs for goods bought of them, 
 and that as a collateral security hoth as to that account and also a 
 further running account all of which is embraced in the present claim, 
 the bond and mortgage were given, — a small note was also included in 
 the account and covered by the: security. The mortgage was on a house 
 and lot in Jersey City, being the third in priority, and a bill to fore- 
 close was filed by one of the prior mortgagees and the plaintiffs made 
 parties, who also became the purchasers of the property, on its being 
 sold under a decree, for fifteen dollars less than the amount of the 
 prior incumbrances. There can be no doubt, as a general rule, that 
 the taking of a bond and mortgage or other security of a higher na- 
 ture extinguishes a debt arising from mere matter of account, yet this 
 
 IV, 17. But if a stranger makes an obligation to me, for th« same debt, yet 
 the contract remains, because that 'tis by another person, and both are now 
 debtors. 29 Hen. VIII, B. Contract, 29." 
 
 In Norfolk R. Co. v. McNamara, 3 Ex. 628 (1849), where a bond with surety 
 was given as collateral security for a pre-existing debt the amount of which 
 was different from that named in the bond, it was held that there was no 
 merger and that action Would lie on the parol contract. Parke, B., said : "If 
 this had been the case of a bond or covenant for the identical debt, the plea 
 would have been a good answer without the additional allegation that the 
 Instrument was given In satisfaction." 
 
 A judgment against one of two or more joint obligors operates as a merger, 
 and discharge of all claim against the others. Peters v. Sanford & Read 1 
 Denio (N. Y.) 224 (1845) ; post, p. 1199, and note. 
 
 '2 Part of the opinion Is omitted. 
 
Sec. 9) AEBITBATION AND AWARD — ^MERGER 1039 
 
 will depend on the intention of the parties. If the higher security 
 was given as the future evidence of the debt, to which the party was 
 to look for payment, then the less security would merge in the greater ; 
 but, if the higher security was to he merely additiojial or collateral 
 to the less, showing that the intention of the parties was to keep the 
 latter open, to be looked to for payment in any event — then the less 
 is not extinguished by the greater security. This doctrine is familiar, 
 and may be found in most of the elementary works and cases that treat 
 upon this subject, particularly in Chit. Cent. 607, and aurhorities there 
 cited. 
 
 The defendant's counsel admitted the position, but insisted that it 
 must appear upon the face of the instrument itself, that it was an 
 additional or collateral security, and the works that treat on this sub- 
 ject and cases adduced, seem to give countenance to. this idea; for in 
 the former it is usually stated as an exception to the general doctrine 
 of merger, that if it appear upon the face of the instrument that it is 
 intended to be a further or collateral security, then the rule of merger 
 does not apply, and the cases referred to by counsel, are of the de- 
 scription where the matter appeared upon the face of the instrument. 
 But these authorities, although they show very clearly that when the 
 matter does so appear the general rule of extinguishment does not ap- 
 ply, yet they do. not therefore prove that when it does not so appear 
 the rule does apply; and if such cases do exist the labors of counsel 
 and the researches of the court have failed to produce them. Deciding 
 the case then upon principle rather than precedent, the question of 
 extinguishment or not is one of intention. What did the parties 
 mean by the transaction? Did they intend that the old security 
 should remain open and the new one be merely collateral or additional ; 
 or did they intend to extinguish the former? This intention is of 
 course to be collected from the face of the instrument itself, where it 
 so appears ; and, if it does not so appear, then from the next best 
 evidence : the only difference being, that in the former case the secur- 
 ity itself proves the exception to the rule, and also the intention of the 
 parties, whilst in the latter, the party alleging the exception must prove 
 it. And in this no evil can arise, there is no parol contradiction of a 
 written instrument, but only an explanation as to the object, for which 
 it was given. A contrary doctrine would prohibit parol proof of the 
 payment of a collateral security, by the payment of the original claim, 
 unless it appeared upon the face of the collateral that it was such. 
 In this particular the court of common pleas erred, and their proceed- 
 ings should be reversed. 
 
 Judgment reversed. 
 
1040 THIBD PARTY BENEFICIARIES (Ch. 6 
 
 CHAPTER VI 
 THIRD PARTY BENEFICIARIES 
 
 LEVER V. HEYS. 
 
 (In the King's Bench, 1599. Moore, K. B. 550.) 
 
 The father of a girl promised the father of a son that if the latter 
 would give his consent to their marriage and assure £40 lands to his 
 son; that he, the father of the girl, would pay i200 to the son upon 
 marriage. The question was whether the son himself or his father 
 should have an action on the case sur assumpsit against the father of 
 the girl if he did not pay the £200. Popham and FennEr thought 
 that the son would have the right of action. Clench e contra ; absente 
 Gawdy.^ 
 
 ROOKWOOD'S CASE. 
 
 (In the Court of Common Pleas, 1590. Cro. Eliz. 164.) 
 
 Rookwood having issue three sons, had an intent to charge his 
 land with four pounds per annum to each of his two youngest sons 
 for their lives; but the eldest son desired him not to charge the 
 land, and promised to pay to theth duly the four pounds per annum ; 
 to which the two younger sons, being present, agreed; and he prom- 
 ised to them to pay it. And for non-payment after the death of 
 the father, they brought an assumpsit. — The whole Court held 
 clearly, that it was well brought, and that it was a good considera- 
 tion ; for otherwise his land had been charged with the rents. ^ 
 
 '■ The following cases denied a remedy to the beneficiary, where he was 
 not related by blood to the promisee : Crow v. Rogers, 1 Strange, 592 (1723) ; 
 Bourne v. Mason, 1 Ventr. 6 (1669) ; Price v. Easton, 4 B. & Adol. 433 
 (1833). 
 
 2 S. e. 1 Leon. 192. In accord: Body v. A,, Gouldsb. 49 (1587). This rule 
 is generally followed in the United States ; the plaintiff being the promisee, 
 although not the one who gives the consideration. Van Eman v. Stanchfield, 
 10 Minn. 255 (Gil. 197 [1865]) ; Rector, etc., St. Mark's Church v. Teed, 120 
 N. Y. 583, 24 N. E. 1014 (1890) ; Palmer Sav. Bank v. Insurance Co., of North 
 America, 166 Mass. 189, 44 N. E. 211, 32 L. R. A. 615, 55 Am. St. Rep. 387 
 (1896). See also Gardner v. Denison, 217 Mass. 492, 105 N. E. 359, 51 L'. R. 
 A. (N. S.) 1108 (1914). 
 
 In First Nat. Bank of Sing Sing v. Chalmers, 144 N. Y. 432, 439, 39 N. E. 
 331 (1895), the court says: "I do not deem the doctrine of Lawrence v. Fox 
 (1859) 20 N. X. 268, involved In this controversy. That doctrine applies where 
 no express promise has been made to the party suing, but he claims the right 
 to rest upon a promise between other parties having respect to the debt due 
 to him and as having been made for his benefit. It struggles to obviate a 
 lack of privity upon equitable principles, but is needless and has no proper 
 
Ch. 6) THIED PARTY BHNEPICIARIES 1041 
 
 ANONYMOUS. 
 
 (1646. Style, 6.) 
 
 J assumes and promiseth to B that if B will pay £50 to C his son, 
 who was married to D the daughter of J at such a time, that he will 
 pay £100 to D his daughter at such a time ; B pays the £50 to C at 
 the time appointed, J fails in payment of the £100 according as was 
 agreed; B dies intestate, and E administers, and brings an action 
 upon the case against J upon this promise made to B the testator; 
 and adjudged that the action did well lie by the administrator, 
 though he should receive no benefit if he did recover.* 
 
 BUTTON et ux. v. POOLE. 
 (In the King's Bench, 1677. 2 Lev. 210.) 
 
 Assumpsit, and declares that the father of the plaintiff's wife being 
 seized of a wood which he intended to sell to raise portions for 
 younger children, the defendant being his heir, in consideration the 
 father would forbear to sell it at his request, promised the father 
 to pay his daughter, now the plaintiff's wife, £1,(XX), and avers that 
 . the father at his request forbore, but the defendant had not paid 
 the £1,0(X). After verdict for the plaintiff upon non assumpsit, it 
 
 application where the privity exists, and a direct promise has been made upon 
 vp^hich the action may rest." See also De Oicco v. Schweizer, 221 N. Y. 431, 
 117 N. E. 807, L. R. A. 1918E, 1004, Ann. Cas. 1918C, 816 (1917), and the 
 dissenting opinion of Comstock, J., in Lawrence v. Fox, 20 N. T. 268 (1859). 
 
 In England, the rule has been flatly repudiated by the House of Lords. 
 Dunlop V. Selfridge, [1915] A. C. 847. 
 
 2 In accord: Bafield v. CoUard, Aleyn, 1 (1646). In this case is the 
 dictum that the beneficiary also may sue, even though it was argued that the 
 defendant would be "doubly charged.'' The promisee can sue if he has a 
 financial interest in the performance promised. Meyer v. Hartman, 72 111. 
 442 (1874) ; Tinkler v. Swaynie, 71 Ind. 562 (1880) ; Baldwin v. Emery, 89 
 Me. 496, 36 Atl. 994 (1897) ; Merriam v. Pine City Lumber Co., 23 Minn. 314, 
 322 (1877) ; O'Neill v. Supreme C!ouneil, American Legion of Honor, 70 N. J. 
 Law, 410, 57 Atl. 463, 1 Ann. Cas. 422 (1904) ; Langan v. Supreme Council, 
 American Legion of Honor, 174 N. T. 266, 66 N. E. 932 (1903), semble; Kelly 
 V. Security Mut. Life Ins. Co., 186 N. T. 16, 78 N. B. 584, 9 Ann. Cas. 661 
 (1906). He has sometimes been denied a remedy where he has no jpecuniary 
 interest in performance. Levet v. Hawes, Cro. Eliz. 619, 652 (1599) ; Ayers 
 V. Dixon, 78 N. Y. 318 (1879) ; Adams v. Union Ky. Co., 21 K. I. 134, 42 Atl. 
 615, 44 L. R. A. 273 (1899) ; Reeves v. State Bank of Bluff City, 63 Kan. 789, ' 
 66 Pac. 995 (1901) ; City of New Haven v. New Haven & D. E. Co., 62 Conn. 
 252, 25 Atl. 316, 18 L. R. A. 256 (3892) ; Evans v. Supreme Council of Royal 
 Arcanum. 223 N. Y. 497, l20 N. E. 93, 1 A. L. R. 163 (1918). The promisee 
 can always maintain suit in those states denying a remedy to the beneficiary. 
 Furnas v.;I)urgin, 119 Mass. 500, 20 Am. Rep. 341 (1876) ; Boardman v. Lar- 
 rabee, 51 Conn. 39 (1883). The promisor can compel the promisee to pay 
 over the sum collected to the third party beneficiary if the latter holds a 
 mortgage on the promisor's land, Williams v. Fowle, 132 Mass., 385 (1882), 
 semble ; Furnas v. Durgin, supra, sem)t)le. 
 
 COEBIN CbNT 66 
 
1042 THIKD PARTY BBNBFICIAKIES (Ch. 6 
 
 was moved in arrest of judgment, that the action ought not to be 
 brought by the daughter, but by the father ; or if the father be dead, 
 by his executors ; for the promise was made to the father, and the 
 daughter is neither privy nor interested in the consideration, noth- 
 ing being due tO' her. Also the father, notwithstanding this agree- 
 ment with the son, might have cut down the wood, and then there 
 was no remedy for the son, nor could the daughter have released 
 the promise, and therefore she cannot have an action against him 
 for not performing the promise, and divers cases were cited- for the 
 defendant, as Yelv. Rippon v. Norton, Hawes v. Leader, Starky v. 
 Milner, 1 Roll. 31, 32, Sty. 296, and a case lately resolved in Com. 
 Banc, inter Norris & Pine, intrat. Hill. 22 and 23 Car. 2, 1538, where 
 the case was, "If you will marry me, I will pay your children so 
 much," and the action being brought by the children, adjudged it 
 lay not. On the other, side it was said, if a man deliver goods or 
 money to H. to deliver or pay to B., B. may have an action, because 
 he is to have the benefit of the bailment, so here the daughter is to 
 have the benefit of the promise. So if a man should say, "Give me 
 a horse, I will give your son £10," the son may bring the actiqn, be- 
 cause the gift was upon consideration of a profit to the son; and 
 the father is obliged by natural affection to provide for his children, 
 for which cause affection, to children is sufficient to raise a use to 
 them out of the father's estate; and therefore the daughter had an 
 interest in the consideration and in the promise, and the son had a 
 benefit by this agreement, for by this means he hath the wood and 
 the daughter is without a portion, which otherwise in all probability 
 the son would have been left to pay, if the wood had not been cut 
 down, nor this agreement between him and his father, and for au- 
 thorities of this side were cited 1 Roll. Ab. 31, Oldman v. Bateman, 
 and ibid. 32; Starky v. Meade. Upon the first argument Wylde and 
 Jones, JJ., seemed tO' think that the action ought to be brought by 
 the father and his executors, though for the benefit of the daughter, 
 and not by the daughter, being not privy to the promise or consid- 
 eration. Twysden and Rainsford seemed contra, and afterward two 
 new judges being made, scil Scroggs, C. J., in lieu of Rainsford, and 
 Dolben in lieu of Twysden, the case was argued again upon the rea- 
 sons aforesaid ; and now Scroggs, C. J., said that there was such 
 apparent consideration of affection from the father to his children, 
 for whom nature obliges him to provide, that the consideration and 
 promise to the father may well extend to the children, and he and 
 Jones remembered the case of Norris & Pine, and that it was ad- 
 judged as aforesaid. But Scroggs said he was then and still is of 
 opinion contrary to that judgment. Dolben, J., concurred with him 
 that the daughter might bring the action, Jones & Wylde hsesita- 
 bant. But next day they also agreed to the opinion of the Chief 
 Justice and Dolben, and so judgment was given for the plaintiff, for 
 the son hath the benefit by having of the wood, and the daughter 
 
Ch. 6) THIRD PARTY BENEFICIARIES 
 
 X043 
 
 hath lost her portion by this means. And now Jones said he must 
 confess he was never well satisfied with the judgment in Norris «& 
 Pine's Case, but being it was resolved, he was loth to give his opin- 
 ion so suddenly against it. And note upon this judgment error was 
 immediately brought, and Trin. 31 Car. 2 it was affirmed in the Ex- 
 chequer Chamber.* 
 
 TWEDDLE v. ATKINSON. 
 (In the Court of Queen's Bench, 1861. 1 Best & S. 393.) 
 
 The declaration stated that the plairitiff was the son of John Twed(ile, 
 deceased, and before the making of the agreement hereafter men- 
 tioned, married the daughter of William Guy, deceased; and before 
 the said marriage of the plaintiff the said William Guy, in consideration 
 of the then intended marriage, promised the plaintiff to give to his said 
 daughter a marriage portion, but the said promise was verbal, and at 
 the time of the making of the said agreement had not been performed ; 
 and before the said marriage the said John Tweddle, in consideration 
 pf the said intended marriage, also verbally promised to give the plain- 
 tiff a marriage portion, which proniise at the time of the making 
 of the said, agreement had not been performed. It then alleged that 
 after the marriage and in the lifetime of the said William Guy, and 
 of the.sai^d John Tweddle, they, the said William Gu^ and John 
 Tweddle, entering into., the agijeemeht hereafter mentioned as a mode, 
 of giving effect to their said verbal promises; and the said William 
 Guy also entering into the said agreement in order to provide for his 
 said daughter a marriage portion, and to procure a further provi- 
 sion to be made by the said John Tweddle, by means of the said agree- 
 ment, for his said daughter, and acting for the benefit of his said 
 daughter ; and the said John Tweddle also entering into the said agree- 
 
 * Blood relationship between the promisee and the third-party beneficiary 
 appears to have had an operative effect in the following cases : In re Ed- 
 mundson's Estate, 259 Pa. 429, 103 Atl. 277, 2 A. L. R. 1150 (1918) post, p. 
 1066; Daily v. Minnick, 117 Iowa, 563, 91 N. W. 913, 60 L. E. A. 840 (1902) ; 
 Benge v. Hiatt's Adm'r, 82 Ky. 666, 56 Am. Rep. 912 (1885) ; Schemerhorn v. 
 Vanderheyden, 1 Johns. (N. Y.) 139, 3 Am. Dec. 304 (1808) ; Todd v. Weber, 
 95 N. Y. 181, 47 Am. Rep. 20 (1884) ; Coleman v. Whitney, 62 Vt. 123, 20 
 Atl. 322, 9 L. R. A. 517 (1889). Contra, Linneman v. Moross Estate, 98 Mich. 
 178, 57 N. W. 103, 39 Am. St. Rep. 528 (1893). 
 
 In the following cases, it is believed, the relationship by blood or marriage 
 •caused the court to strain the facts and to hold, contrary to the fact, that 
 the beneficiary was also a promisee : De Cicco v. Schweizer, 117 N. E. 807, L. 
 R. A. 1918E, 1004, Ann. Cas. 1918C, 816 (1917) ; Gardner v. Denison, 217 Mass. 
 492, 105 N. E. 359. 51 L. R. A. (N. S.) 1108 (1914) ; Eaton v, Libbey, 165 Mass. 
 218, 42 N. E. 1127, 52 Am. St. Rep. 511 (1896) ; Freeman v. Morris, 131 
 AVis. 216, 109 N. W. 983, 120 Ain. St. Rep. 1038, 11 Ann. Cas. 481 (1908). In 
 the following cases such relationship caused the court to hold that the 
 promisee owed the beneficiary a legal or an equitable duty when in fact there 
 was none : Buchanan v. Tilden, 158 N. Y. 109, 52 N. E. 724, 44 L. R. A. 170, 
 70 Am. St. Rep. 454 (1899) ; Seaver v. Ransom, 224 N. Y. 233, 120 N. E. 639, 
 2 A. L. R. 1187 (1918), post, p. 1061. - 
 
1044 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 ment in order to provide for the plaintiff a marricige portion, and to 
 procure a further provision to be made by the said WiUiam Guy, by 
 means of the said agreement, for the plaintiff, and acting for the bene- 
 fit of the plaintiff ; they the said William Guy and John Tweddle made 
 and entered into an agreenient in writing in the words following — 
 that is to say : 
 
 "High Coniscliffe, July 11, 1855. 
 
 "Memorandum of an agreement made this day between William 
 Guy, of, etc., of the one part, and John Tweddle, of, etc., of the other 
 part. Whereas it is mutually agreed that the said William Guy shall 
 and will pay the sum of i200 to William Tweddle, his son-in-law ; and 
 the said John Tweddle, father to the aforesaid William Tweddle, shall 
 and will pay the sum of £100 to the said William Tweddle, each and 
 severally the said sums on or before August 21st, 1855. And it is 
 hereby further agreed by the aforesaid William Guy and the said 
 John Tweddle that the said William Tweddle has full power to sue the 
 said parties in any court of law or equity for the aforesaid sums hereby 
 promised and specified." 
 
 And the plaintiff says that afterward and before this suit, he and 
 his said wife, who is still living, ratified and assented to the said agree- 
 ment, and that he is the William Tweddle therein mentioned. And 
 the plaintiff says that the said August 21st, 1855, A. D., elapsed, and 
 all things have been done and happened, necessary to entitle the plain- 
 tiff to have the said sum of i200 paid by the said William Guy or his 
 executor, yet neither the said William Guy nor his executor has paid 
 the same, and the same is in arrear and unpaid, contrary to the said 
 agreement. 
 
 Demurrer and joinder therein. 
 
 WiGHTMAN, J. Some of the old decisions appear to support the 
 proposition that a stranger to the consideration of a contract may 
 maintain an action upon it, if he stands in such a near relationship to 
 thp party from whom the consideration proceeds, that he may be con- 
 sidered a party to the consideration. The strongest of those cases is 
 that cited in Bourne v. Mason, 1 Ventr. 6, in which it was held that 
 the daughter of a physician might maintain assumpsit upon a promise 
 to her father to give her a sum of money if he performed a certain 
 cure. But there is no modern case in which the proposition has been 
 supported. On the contrary, it is now established that no stranger to 
 the consideration can take advantage of a contract, although made for 
 his benefit. * 
 
 Crompton, J. It is admitted that the plaintiff cannot succeed unless 
 this case is an exception to the modern and well-established doctrine 
 of the action of assumpsit. At the time, when the cases which have 
 been cited were decided the action of assumpsit was treated as an 
 action of trespass upon the case, and therefore in the nature of a 
 tort ; and the law was not settled, as it now is, that natural love and 
 affection is not a sufficient consideration for a promise upon which an 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1045 
 
 action may be maintained; nor was it settled that the promisee cannot 
 bring an action unless the consideration for the promise moved from 
 him. The modern cases have, in effect, overruled the old decisions; 
 they sljow that the consideration must move from the party entitled 
 to sue upon the contract. It would be a monstrous proposition to say 
 that a person was a party to the contract for the purpose of suing upon 
 it for his own advantage, and not a party to it for the purpose of being 
 sued. It is said that the father in the present case was agent for the 
 son in making the contract, but that argument ought also to make the 
 son liable upon it. I am prepared to overrule the old decisions, and 
 to hold that, by reason of the principles which now govern the action 
 of assumpsit, the present action is not maintainable. 
 
 Blackburn, J. The earlier part of the declaration shows a contract 
 which might be sued on, except for the enactment in § 4 of the 
 Statute of Frauds, 29 Gar. 2, ch. 3. The declaration liien sets out a 
 new contract, and the only point is whether, that contract being for 
 the benefit of the children, they can sue upon it. Mellish admits that 
 in general no action can be maintained upon a promise, unless the 
 consideration moves from the party to whom it is made. But he says 
 that there is an exception — ^namely, that when the consideration moves 
 from a father, and the contract is for the benefit of his son, the natural 
 love and affection between the father and son gives the son the right 
 to sue as if the consideration had proceeded from himself. And 
 Dutton and Wife v. Poole, 2 Lev. 210; 1 Ventr. 318 was cited for 
 this. We cannot overrule a decision of the Exchequer Chamber, but 
 there is a distinct ground on which that case cannot be supported. 
 The cases upon Stat. 27 El. ch. 4, which have decided that, by § 2, 
 voluntary gifts by settlement after marriage are void against subse- 
 quent purchasers for value, and are not saved by § 4,. show that 
 natural love and affection are not a sufficient consideration whereon 
 an action of assumpsit may be founded. 
 
 Judgment for the defendant." 
 
 LAWRENCE v. FOX. 
 (Court of Appeals of New York, 1859. 20 N. T. 268.) 
 
 Appeal from the Superior Court of the City of Buffalo. On the trial 
 before Mr. Justice Hasten, it appeared by the evidence of a bystander 
 that one Holly, in November, 1857, at the request of the deifendant, 
 loaned and advanced to him $300, stating at the time that he owed 
 that sum to the plaintiff for money borrowed of him, and had agreed 
 to pay it to him the then next day : that the defendant, in considera- 
 tion thereof, at the time of receiving the money, promised to pay it to 
 
 ,^ Ap to the prese;nt;law in England,,, s§e cases cited in note 6 to Lavfrence 
 V. Fox, post, p. 1049; alsp Dunlop Tyre Co., v. Self ridge, 11915] A. Q. 847; 
 Les Affreteurs V. Walford; [1919] A; 0. '801; ■■ ■ ' ■• '■ ' 
 
1046 THIRD PAETT BENEFICIARIES (Ch.6 
 
 the plaintiff the theri next day. Upon this state of facts the defendant 
 moved for a nonsuit, upon three several grounds, viz.: That there" 
 was no proof tending to show that Holly was indebted to the plaintiff, 
 that the agreement by the defendant with PloUy to pay the plaintjff was 
 void for want of consideration, and that there was no privity between 
 the plaintiff and' defendant. The court overruled the motion, and the 
 counsel for the defendant excepted. The cause was then submitted to 
 the jury, and they found a verdict for the plaintiff for the amount of 
 the loan and interest, $344.66, upon which judgment was entered, from 
 which the defendant appealed to the Superior Court, at General Term, 
 where the judgment was affirmed, and the defendant appealed to this 
 court. The cause was Submitted on printed, arguments. 
 
 H. Gray, J. The first objection raised on the trial kmounts to this : 
 That the evidence of the person present, who heard the declarations 
 of Holly giving directions as to the payinen't of the money he was 
 then advancing to the defendant, was mere hearsay and, therefore, 
 not competent. Had the plaintiff sued Holly for this sum of money 
 no objection to the competency' of this evidence would have been 
 thought of; and if the defendant had performed his promise by pay- 
 ing the sum loaned to him to the plaintiff, and Holly had afterward 
 sued him for its recovery, ind this evidence had been offered by' the 
 defendaiit, it would doubtless have been received without an objection 
 from any souirce. All the defendant had the right to demand in this' 
 case was evidence which, as between .Holly and the plaintiff,' was'com- 
 petent to establish the relation between theni of debtor and creditor. 
 For that purpose the evidence was clearly competent ; it covered the 
 whole ground and warranted the verdict of the jury. , 
 
 But it is claimed that notjvithstanding this promise was established 
 by competent evidence, it was void for the want of consideration. It 
 is now more than a quarter of a century since it was settled by the 
 supreme court of this state — in an able aiid painstaking opiniofi by 
 the late Chief Justice Savage, in which the authorities were fullyex- 
 amined and carefully analyzed— that a promise in all material respects 
 like the one under consideration was valid; and the judgment of 
 that court was unanimously affirmed by the court for the correction of 
 errors. Farley v. Cleveland, 4 Cow. 432, 15 Am; Dec. '387; s. c. 
 in error, 9 Cow. 639. In that case one Moon owed Farley and sold to 
 Cleveland a quantity of hay, in consideration of which Cleveland prom- 
 ised to pay Moon's debt to Farley ; and the decision in favor of Far- 
 ley's right to recover was placed upon the ground that the hay received 
 by Cleveland from Moon was a valid consideration for Cleveland's 
 promise to pay Farley, and that the subsisting liability of Moon to 
 pay Farley was no objection to the recovery. The fact that the money 
 advanced by Holly to the defendant was a loan to him for a day, and 
 that it thereby became the property of the defendant, seemed to im- 
 press the defendant's counsel with the idea, that bepause the defend- 
 
Gh. 6) THIRD PARTY BBNBFICIAKIES 1047 
 
 ant's promise was not a trust fund placed by the plaintiff in the de- 
 fendant's hands, out of which he was to realize money as from the 
 sale of a chattel or the collection of a debt, the promise although made 
 for the benefit of the plaintiff could not inure to his benefit. The hay 
 which Cleveland delivered to Moon was not to be paid to Farley, but 
 the debt incurred by Cleveland for the purchase of the hay, like the 
 debt incurred by the defendant for money borrowed, was what was 
 to be paid. 
 
 That case has been often referred to by the courts of this state, and 
 has never been doubted as sound authority for the principle upheld by 
 it. Barker v. Bucklin, 2 Denio, 45, 43 Am. Dec. 726; Canal Co. v. 
 Westchester County Bank, 4 Denio, 97. It puts to rest the objection 
 that the defendant's promise was void ior want of consideration. The 
 report of that case shows that the promise was not only made to Moon 
 but to the plaintiff Farley. In this case the promise Was made to Holly 
 and not expressly to the plaintiff ; and this difference between the two 
 cases presents the question, raised by the defendant's objection, as to 
 the want of privity between the plaintiff and defendant. As early as 
 1806 it was announced by the supreme court of this state, upon what 
 was then regarded as the settled law of England,, "That where one 
 person makes 'a promise to another for the benefit of a third person, 
 that third person may maintain an action upon it." Schemerhom v. 
 Vanderheyden, 1 Johns. 140, 3 Am. Dec. 304, has often been reas- 
 serted by our courts and never departed from. 
 
 The case of Seaman v. White has occasionally been referred to 
 (but not by the courts) not only as having some bearing upon the ques- 
 tion now under consideration, but as involving in doubt the soundness 
 of the proposition stated in Schemerhom v. Vanderheyden. In that 
 case one Hill, on the 17th of August, 1835, made his note and procured 
 it to be indorsed by Seaman and discounted by the Phoenix Bank. Be- 
 fore the note matured and while it was owned by the Phoenix Bank, 
 Hill placed in the hands of the defendant, Whitney, his draft accepted 
 by a third party, which the defendant indorsed, -and on the 7th of Oc- 
 tober, 1835, got discounted and placed the avails in the hands of an 
 agent with which to take up Hill's note; the note became due, Whit- 
 ney withdrew the avails of the draft from the hands of his agent and 
 appropriated it to a debt due him from Hill, and Seaman paid the note 
 indorsed by him and brought his suit against Whitney. Upon this 
 state of facts appearing, it was, held that Seaman could not recover : 
 first, for the reason that no promise had been made by Whitney to 
 pay, and second, if a promise could be implied from the facts that Hill's 
 accepted draft, with which to raise the means to pay the note, had been 
 placed by Hill in the hands of Whitney, the promise would not be to 
 Seaman, but to the PhcEnix Bank who then owned the note ; although 
 in the course of the opinion of the court, it was stated that, in all cases 
 the principle of which was sought to be appUed to that case, the. fund 
 
1048 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 had, been appropriated by, an express undertaking of the defendant 
 .Tyith the creditor. But before concluding; the opinion of the court in 
 this case, the learned judge who delivered it conceded that an under- 
 taking to pay the creditor may be implied f rqm an arrangement to that 
 effect between the defendant and the debtor. 
 
 This question was subsequently, and in a case quite recent, again 
 the subject of coiisideration by the supreme court, when it was held, 
 that in declaring upon a promise made to the debtor by a third party 
 to pay the creditor of the debtor, foundeci upon a consideration ad- 
 vanced by the. debtor, it was unnecessary to aver a promise to the 
 creditor; for the reason that upon proof of a promise made to the 
 debtor to pay the creditor, a promise to, the creditor would be implied. 
 And in support of this proposition, in no respect distingiiishable from 
 the one now under consideration, the case of Schemerhom v. Van- 
 derheyden, with many intermediate cases in our courts, were cited, in 
 which the doctrine of that case was not only approved but affirmed. 
 Canal Co. v. Westchester County Bank, 4 Denio, 97. The same prin- 
 ciple is adjudged in several cases in Massachusetts. I will refer to 
 but few of them. Arnold v. layman, 17 Mass. 400, 9 Am. Dec. 154; 
 Hall V. Marston, 17 Mass. 575 ; Brewer v. Dyer, 7 Cush. (Mass.) 337, 
 340. In Hall v. Marston the court say: "It seems to have been well 
 settled that if A. promises B. for a valuable consideration to pay C, 
 the latter may maintain assumpsit for the money;" and in Brewer v. 
 Dyer, the recovery was upheld, as the court said, "upon the principle 
 of law long recognized and clearly established, that when one person, 
 for a valuable consideration, engages with another, by a simple contract, 
 to do some act for the benefit of a third, the latter, who would enjoy 
 the benefit of the act, may maintain an action for the breach of such 
 engagement ; that it does not rest upon the ground of any actual or 
 supposed relationship between the parties as some of the earlier cases 
 would seem to indicate, but upon the broader and more satisfactory 
 basis, that the law operating on the act of the parties creates the duty, 
 establishes a privity, and implies the promise and obligation on which 
 the action is founded." 
 
 There is a more recent case decided by the same court, to which 
 the defendant has referred and claims that it at least impairs the force 
 of the former cases as authority. It is the case of M'ellen v. Whipple, 
 1 Gray (Mass.) 317. In that case one Rollins made his note for $500, 
 payable to Ellis and Mayo, or order, and to secure its payment mort- 
 gaged to the payees a certain lot of ground, and then sold and con- 
 veyed the mortgaged premises to the defendant, by deed in which it 
 was stated that the "granted premises were subject to a mortgage for 
 $500, which mortgage, with the note for which it was given, the said 
 Whipple is to assume and cancel." The deed thus made 'was accepted 
 by Whipple, the mortgage was afterward duly assigned, and the note 
 indorsed by Ellis and Mayo' to the plaintiff's intestate. After Whip- 
 ple received the deed he paid to the mortgagees and their assigns the 
 
Ch. 6) THIRD PARTY BENEFICIARIES: 
 
 1049 
 
 interest upon the mortgage and note for a time, and upon refusing to 
 continue his payments was sued by the plaintiff as adtninistratrix of the 
 assignee of the mortgage and note. The court. held that the stipula- 
 tion in the deed that Whipple should pay the mortgage and note was 
 a matter exclusively between the two parties to the deed; that the sale 
 by Rollins of the equity of redemption did not lessen the plaintiff's se- 
 curity, and that as nothing had been put into the defendant's hands 
 for the purpose of meeting the plaintiff's claim on Rollins, there was 
 no consideration to support an express promise, much less an implied 
 one, that Whipple should pay Mellen the amount of the note. That, 
 is all that was decided in that case, and the substance of the reasons 
 assigned for the decision; and whether the case was rightly disposed 
 of or not, it has not in its facts any analogy to the case before us, 
 nor do the reasons assigned for the decision bear in any degree upon 
 the question we are now considering. 
 
 But it is urged that because the defendant was not in any sense a 
 trustee of the property of Holly for the benefit of the plaintiff, the 
 law will not imply a promise. I agree that many of the cases where 
 a. promise was implied were cases of trusts, created for the bene- 
 fit of the promisor. The case of Felton v. Dickinson, 10 Mass. 287, 
 and others that might be cited are of that class; but concede them 
 all to have been cases of trusts, and it proves nothing against the ap- 
 plication of the rule to this case. The duty of the trustee to pay the 
 cestui que trust, according to the terms of the trust, implies his prom- 
 ise to the latter to do so. In this case the defendant, upon ample con- 
 sideration received from Holly, promised Holly to pay his debt to the 
 plaintiff; the consideration received and the promise to Holly made 
 it as plainly his duty to pay the plaintiff as if the money had been 
 remitted to him for that purpose, and as well implied a promise to do 
 so as if he had been made a trustee of property to be converted into 
 cash with which to pay. The fact that a breach of the duty im- 
 posed in the one case may be visited, and justly, with more serious 
 consequences than in the other, by no means disproves the payment 
 to be. a duty in both. The principle illustrated by the example so fre- 
 quently quoted (which concisely states the case in hand) "that a prom- 
 ise made to one for the benefit of another, he for whose benefit it is 
 made may bring an action for its breach," has been applied to trust 
 cases, not because it was exclusively applicable to those cases, but be- 
 cause it was a principle of law, and as such applicable to those cases." 
 
 ^ Courts of equity, even in England and Massachusetts, have been very 
 ready to expand the concept of a trust, so as to include a mere contract bene- 
 ficiary. See TomlinBon v. Gill, Ambler, 330 (1756), before Hardwicke, L. C. ; 
 Moore v. Darton, 4 De G. & Sm. 517 (1851) ; Lloyds v. Harper (C. A.) 16 
 Ch. D. 290 (1880) ; Gregory v. Williams, 3 Mer. 582 (1817) ; Page v. Cox, 10 
 Hare, 163 (1851) ; Touche v. Metrop. W. Co., L. E. 6 Ch. 671, 677 (1871) ; 
 School Dist. of Kansas City ex rel. Koken Iron Works v. Livers, 147 Mo. 580, 
 49 S. W. 507 (1899) ; Forbes v. Thorpe, 209 Mass. 570, 95 N. E. 955 (1911) ; 
 Grime v. Borden, 166 Mass. 198, 44 N. E. 216 (1896) ; Nash v. Co'mmonvrealth, 
 174 Mass. 335, 54 N. E. 865 (1899). ' , , : 
 
1050 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 It was'also; insisted that' Holly, could have discharged the defendant 
 from his promise, though it was intended by both parties for the bene- . 
 fit of the plaintiff, and, therefore, the plaintiff was not entitled to main- 
 tain this suit for the recovery of a demand over which he had no con- 
 trol. It is enough that the plaintiff did not release, the defendant from 
 his promise, and' whether he could or not is a question not now neces- 
 sarily involved ; but if it was, I think it would be found difficult to 
 maintain the right of Holly to discharge a judgment recovered by the 
 plaintiff upon confession or otherwise, for the breach of the defend- 
 ant's promise; and if he could not, how could he discharge the suit 
 before judgment, or the promise before suit, made as it was for the 
 plaintiff's benefit and in accordance with legal- presumption accept- 
 ed by him (Berly v. Taylor, 5 Hill, 577^584 et seq.), until his dis- 
 sent was shown? 
 
 The cases cited and especially;. that of Farley v. Cleveland, estab- 
 lished the validity of a parol promise; it stands then upon the foot- 
 ing of a written one. Suppose the: defendant had given his note in 
 which for value received of Holly/ he had promised to pay the plain- 
 tiff and the plaintiff had accepted the promise, retaining Holly's liability. 
 Very clearly Holly could not have discharged that promise, be the 
 right to release the defendant as it may. No one can doubt that he 
 owes the sum of money demanded of him, or that in accordance with 
 his promise it was his duty to have paid it to the plaintiff ; nor can it 
 be doubted that whatever may be the diversity of opinion elsewhere, 
 the adjudications in this state, from a very early period,- approved by 
 experience, have established the defendant's liability; if, therefore, it 
 could be shown that a more strict and technically accurate application 
 of the rules applied, would lead to a different result (which I by no 
 means concede), the effort should not be made in the face of manifest 
 justice. , 
 
 The judgment should be affirmed. 
 
 Johnson, C. J., and Denio, J., based their judgment -upon the ground 
 that the promise was to be regarded as made- to the plaintiff through 
 the medium of his agent, whose action he could ratify when it came 
 to his knowledge, though taken without his being privy thereto. 
 
 CoMSTocK, J. (dissenting) . The plaintiff had riothing to do with the 
 promise on which he brought this action. It was not' made to him, nor 
 did the consideration proceed from him. If he can maintain the suit, 
 it is because an anomaly has found its way into the law on this subject. 
 In general, there must be privity of contract. The party who sues upon 
 a promise must be the promisee, or he must have some legal interest 
 in the undertaking. In this case, it is plain that Holly, who loaned 
 the money to the defendant, and to whom the promise in question was 
 made, could at any time havfe claimed that it should be performed to 
 himself personally. He had lent the money to the defendant, and at 
 the same time directed the, latter to pay the sum to the plaintiff. This, 
 direction he pould countermand, and if he had done so, manifestly the 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1051 
 
 defendant's promise to pay according to. the direction would have 
 ceased to exist. The plaintiff would receive a benefit by a complete 
 execution of the arrangement, but the arrangement itself was between 
 other parties, and was under their exclusive control. If the defendant 
 had paid the money -to Holly, his debt would have been discharged 
 thereby. So Holly might have released the demandor assigned it to an- 
 other person, or the parties might have annulled the promise now in 
 question, and designated some other creditor of Holly as the party, to 
 whom the money should be paid. It has never been claimed that in a 
 case thus situated the right of a third person to sue upon the promise 
 rested on any sound principle of law. We are to inquire whether the 
 rule has been so established by positive authority. 
 
 The cases which have sometimes been supposed to have a bearing 
 on this question are quite numerous. In some of them, the dicta, of 
 judges, delivered upon very slight consideration, have been referred 
 to as the decisions of the courts. Thus, in Schemerhorn v. Vander- 
 heyden, 1 Johns. 140, 3 Am. Dec. 304, the court is reported as saying : 
 "We are of opinion that where one person makes a promise to another, 
 for the benefit of a third person, that third person may maintain an 
 action on such promise." This remark was made on the authority 
 of Dutton V. Poole, Vent. 318, 332, decided in England nearly two hun- 
 dred years ago. It was, however, but a mere remark, as the case 
 was determined against the plaintiff on another ground. Yet this 
 decision has often been referred to as authority for similar observa- 
 tions in later cases. 
 
 In another class of cases, which have been sometimes supposed to 
 favor the doctrine, the promise was made to the persori who brought 
 the suit, while the consideration proceeded from another; the ques- 
 tion considered being, whether the promise was void by the statute of 
 frauds. Thus, in Gold v. Phillips, 10 Johns. 412, one Wood was in- 
 debted to the plaintiffs for services as attorneys and counsel, and he 
 conveyed a farm to the defendants, who, as part of the consideration, 
 were to pay that debt. Accordingly,' the defendants wrote to the plain- 
 tiffs, informing them that an arrangement had been made by which 
 they were to pay the^ demand. The defense was, that the promise was 
 void within the statute, because, although in writing, it did not express 
 the consideration. But the action was sustained, on the ground that 
 the undertaking was original and not collateral. So in the case of Far- 
 ley V. Cleveland, 4 Cow. 432, 15 Am. Dec. 387; Id., 9 Cow. 639, the 
 facts proved or offered to be proved were, that the plaintiff held a 
 note against one Moon ; that Moon sold hay to the defendant, who in 
 consideration of that sale promised the plaintiff by parol to pay the 
 note. The only question was, whether the statute of frauds applied 
 to the case. It was held by the supreme court, and afterward by the 
 court of errors, that it did not. Such is also precisely the doctrine of 
 Ellwood V. Monk, 5 Wend. 235, where it was held that a plea of the 
 statute of frauds to a count upon a promise of the defendant to the 
 
1052 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 plaintiff, to pay the latter a debt owing to him by another person, the 
 promise being founded on a sale of property to the defendant by the 
 other person, was bad. 
 
 The cases mentioned and others of a like character were referred to 
 by M!r. Justice Jewett, in Barker v. Bucklin,;2 Denio, 45, 43 Am. 
 Dec. 726. In that case the learned justice considered at some length 
 the question now before us. The authorities referred to were mainly 
 those which I have cited, and others upon the statute of frauds. The 
 case decided nothing on the present subject,, because it was determined 
 against the plaintiff on a ground not involved in this discussion. The 
 doctrine was certainly advanced which the plaintiff now contends for, 
 but among all the decisions which were cited, I do not think there is 
 one standing directly upon it. The case of Arnold v. Lyman, 17 
 Mass.. 400, 9 Am. Dec. 154, might perhaps be regarded as an excep- 
 tion to this remark, if a different interpretation had not been given to 
 that decision in the supreme court of the same state where it was pro- 
 nounced. In the recent case of Mellen v. Whipple, 1 Gray (Mass.) 317, 
 that decision is understood as belonging to. a class where the defend- 
 ant has in his hands a trust fund, which was the foundation of the 
 duty or promise on which the suit is brought; 
 
 The cases in which some trust was involved are also frequently 
 referred to as authority for the doctrine now in question, but they 
 do not sustain it. If A. delivers money or property to B., which the 
 latter accepts upon a trust for the benefit of C, the latter can enforce 
 the trust by an appropriate action for that purpose. Berly v. Taylor, 
 5 Hill, 577. If the trust be of money, I think the beneficiary may as- 
 sent to it and bring the action for money had and received to his use. 
 If it be of something else than money, the trustee must account for it 
 according to the terms of the trust, and upon principles of equity. 
 There is some authority even for saying that an express promise found- 
 ed on the possession of a trust fund may be enforced by an action at 
 law in the name of the beneficiary, although it was made to the creator 
 of the trust. Thus, in Comyn, Dig. "Action on the Case upon As- 
 sumpsit," B. 15, it is laid down that if a man promise a pig of lead to 
 A., and his executor give lead to make, a pig to B., who assumes to 
 deliver it to A., an assumpsit lies by A. against him. The case of Del- 
 aware & H. Canal Co. v. Westchester County Bank, 4 Denio, 97, in- 
 volved a trust because the defendants had received from a third party 
 a bill of exchange under an agreement that they would endeavor to 
 collect it, and would pay over the proceeds when collected to the plain- 
 tiffs. A fund received under such an agreement does not belong to the 
 person who receives it. He must account for it specifically; and per- 
 haps there is no gross, violation of principle in permitting the equitable 
 owner of it to sue upon an express promise to pay it over. Having 
 a specific interest in the thing, the undertaking to account for it may be 
 regarded as in some sense made with him through the author of the 
 trust. But further than this we cannot go without violating plain 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1053 
 
 rules of law. In the case before us there was nothing in, the nature of 
 a trust or agency. The defendant borrowed the money of Holly and 
 received it as his own. The plaintiff had no right in the fund, legal 
 or equitable. The jirornise to repay the money created an obligation 
 in favor of the lender to whom it was made and not in favor of any one 
 else. 
 
 I have referred to the dictum in Schemerhorn v. Vanderheyden, 1 
 Johns. 140, 3 Am. Dec. 304, as favoring the doctrine contended for. 
 It was the earliest in this state, and was founded, as already observed, 
 on the old English case of Dutton v. Poole, Vent. 318. That case has 
 always been referred to as the ultimate authority whenever the rule in 
 question has been mentioned, and it deserves, therefore, some fur- 
 , ther notice. The father of the plaintiff's wife being seized of certain 
 lands, which afterward on his death descended to the defendant, and 
 being about to cut il,000 worth of timber to raise a portion for his 
 daughter, the defendant promised the father in consideration of his 
 forbearing to cut the timber, that he would pay the said daughter the 
 £1,000. After verdict for the plaintiff, upon the issue of non-assumpsit, 
 it was urged in arrest of judgment that the father ought to have 
 brought the action, and not the husband and wife. It was held, after 
 much discussion, that the action would lie. The court said : "It might 
 be another case if the money had been to have been paid to a stran- 
 ger; but there is such a manner of relation between the father and 
 the child, and it is a kind of debt to the child to be provided for, that 
 the plaintiff is plainly concerned." 
 
 We need not criticise the reason given for this decision. It is enough 
 for the present purpose, that the case is no authority for the general 
 doctrine, to sustain which it has been so frequently cited. It belongs 
 to a class of cases somewhat peculiar and anomalous, in which prom- 
 ises have been made to a parent, or person standing in a near rela- 
 tionship to the person for whose benefit it was made, and in which, 
 on account of that relationship, the beneficiary has been allowed to 
 maintain the action. Regarded as standing on any other ground, they 
 have long since erased to be the law in England. Thus, in Crow v. 
 Rogers, 1 Strange, 592, one Hardy was indebted to the plaintiff in the 
 sum of £7Q, and upon a discourse between Hardy and the defendant, 
 it was agreed that the defendant should pay that debt in consideration 
 of a house, to be conveyed by Hardy to him. The plaintiff brought 
 the action on that promise, and Dutton v. Poole was cited in support of 
 it. But it was held that the action would not lie, because the plaintiff 
 was a stranger to the transaction. Again, in Price v. Easton, 4 Barn. 
 & Adol. 433, one William, Price was indebted to the plaintiff in £13. 
 The declaration averred, a promise of the defendant to pay the debt, in 
 consideration that William Price would work for him, and leave the 
 wages in his hands ; and that Price did work accordingly, and earned 
 a large sum of money, which he left in the defendant's hands. After 
 verdict for the plaintiff, a motion was made in arrest of judgment, on 
 
1054 THIRD PAETT BENEFICIARIES > (Ch. 6 
 
 the ground' that the plaintiff was a stranger to the consideration. But- 
 ton y. Poole, and other cases of that -class, were^ cited in opposition to 
 the- motion, but the judgment was arrested. L^rd Denman said: 
 "I think the declaration cannot be supported, as it does not show any 
 consideration for the promise moving from the plaintiff to the defend- 
 ant." Littledale, J., said: "No privity is shown between the plaintiff 
 and the defendant. The case is precisely like Crow v. Rogers, -and 
 must be governed' by it." Taunton, J., said: "It is consistent with 
 all the matter alleged in the declaration, that the plaintiff may have 
 been entirely ignorant of the arrangement between William Price and 
 the defendant." Patterson, J., observed: "It is clear that the allega- 
 tions do not show a right of action in the plaintiff. There is no promise 
 to the plaintiff alleged." The same doctrine is recognized in Lilly v. 
 Hays, 5 Adol. & E. 548, and such is now the settled rule in England, 
 although at an early day there was some obscurity arising out of the 
 case of Button v. Poole", and others of that' peculiar class. 
 
 The question was also involved in some confusion by the earlier cases 
 in Massachusetts. Indeed, the supreme court: of that state seems at orie 
 time to have made a nearer approach to the doctrine on which this 
 action must rest than the courts of this state have ever done. 10 
 Mass. 287; 17 Mass. 400, 9 Am. Bee. 154. But in the recent case 
 of Mellen v. Whipple, 1 Gray (Mass.) 317, the subject was carefully 
 reviewed and the doctrine utterly overthrown. One Rollin was in- 
 debted to the plaintiff's testator, and had secured the debt by a mort- 
 gage on his land. He then conveyed the equity of redemption to the de- 
 fendant, by a deed which contained a clause declaring that the defend- 
 ant was to assume and pay the mortgage. It was conceded that the 
 acceptance of the deed with such a clause in it was equivalent to an 
 express promise to pay the mortgage, debt; and the question was, 
 whether the mortgagee or his representative could sue on that under- 
 taking. It was held that the suit could not be maintained ; and in the 
 course of a very careful and discriminating opinion by Judge Metcalf, 
 it was shown that the' cases which had been supposed to favor the 
 action belonged to exceptional classes, none of which embraced the 
 pure and simple case of an attempt by one person to enforce a prom- 
 ise made to another, from whom the consideration wholly proceeded. 
 I am of that opinion. 
 
 The judgment of the court below should, therefore, be reversed, atid 
 a new trial granted. 
 
 GrovBr, J., also dissented. 
 
 Judgment affirmed.' 
 
 7 In accord: Bohanan v. Pope, 42 Me. 93 (1856); Joslin v. New Jersey 
 Car Spring Co., 36 N. J. Law, 141 (1873) ; Barker v. Bucklin, 2 Denio (N. Y.I 
 45, 43 Am. Dec. 726 (1846) ; Wood v. Moriarty, 15 E. I. 518, 9 Atl. 427 (188V} ; 
 Zell's Appeal, 111 Pa. 532, 547, 6 Atl. 107 (1886) ; Bryant v. Jones, 183 Ky. 
 298, 209 S. W. 30 (1919) ; Spring.s v. Cole, 171 N. C. 418, 88 S. E. 721 (1916) ; 
 Ballard v. Home Nat. Bank of Arkansas City, 91 Kan. 91, 136 Pac. 935, L. 
 
Ch. 6) THIED PARTY BENEFICIAKIES 1055 
 
 VROOMAN V. TURNER. 
 (Court of Appeals of New "Xork, 1877. 69 N. Y. 280, 25 Am. Rep. 195.) 
 
 This was an action to foreclose a mortgage. 
 
 The mortgage was executed in August, 1873, by defendant Evans, 
 who then owned the mortgaged premises. He conveyed the same to 
 one Mitchell, and through various mesne conveyances the title .came to 
 one Sanborn. In none of these conveyances did the grantee assume to 
 pay the mortgage. Sanborn conveyed the same to defendant Harriet 
 B. Turner, by deed which contained a clause stating that the convey- 
 ance was subject to the mortgage, "which mortgage the party hereto 
 of the second part hereby .covenants and agrees to pay off and dis- 
 charge, the same forming part of the consideration thereof," 
 
 The referee found that said grantee, by so assuming payment of 
 the mortgage, became personally liable therefor, and directed judg- 
 ment against her for any deficiency. Judgment was entered accord- 
 ingly. 
 
 Ai^LEN, J. The precise question presented by the appeal in this ac- 
 tion has been twice before the courts of this State, and received the 
 same solution in each. It first arose in King v. Whitely, 10 Paige, 465, 
 decided in 1843. There the grantor of an equity of redemption in 
 rtiortgaged premises, neither legally nor equitably interested in the 
 
 E. A. 19160, 161 (1913), and note. See 25 L. R. A. 257, note; 13 0. J. 705, 
 § 815, citing hundreds of cases. 
 
 Where one sells his business, stock in trade, or choses in action, and the 
 buyer undertakes to pay the seller's debts, an action lies against the buyer on 
 this promise, even though the creditor who sues may not have been specifically 
 pointed out. Sherwood' & Sherwood v. Gill & Latz, 36 Oal. App. 707, 173 Pac. 
 171 (1918) ; Davidson v. Madden, 89 Or. 209, 173 Pac. 320 (1918) ; Baker- 
 Hanna-Blake Go. v. Faynter-McVicker Grocery Co. (Okl.) 174 Pac. 265 
 (1918) ; Lawrence Coal Co. v. Shanklin, 25 N. W. 404, 183 Pac. 435 (1919) ; 
 Bradley v. McDonald, 218 N. T. 351, 113 N. E. 340 (1916) ; Gibson v. Victor 
 Talking Mach. Co. (D. C.) 232 Fed. 225 (1916). 
 
 Where a new partner enters a firm and promises the old members to pay 
 a share of the previous debts, he may properly be sued by the creditors. 
 Arnold v. Nichols, 64 N. Y. 117 (1876) ; Lehow v. Simonton, 3 Colo. 346 
 
 (1877) ; Dunlap v. McNeil, 35 Ind. 316 (1871) ; Floyd v. Ort, 20 Kan. 162 
 
 (1878) ; Hannigan v. Allen, 127 N. T. 639, 27 N. E. 402 (1891) ; Claflin v. 
 Ostrom, 54 N. Y. 581 (1874) ; Maxfleld v. Schwartz, 43 Minn. 221, 45 N. 
 W. 429 (1890) ; 13 C. J. 709. 
 
 Where a mortgagor insures premises and the policy is made payable to the 
 mortgagee as his interest may appear, the mortgagee can sue the insurer. 
 Union InstituUon for Savings v. Phoenix Ins. Co., 196 Mass. 230, 81 N. B. 994, 
 14 L. R. A.' (N. S.) 459, 13 Ann. Cas 433 (1907), on theoi-y of agency; Palmer 
 Savings Bank v. Insurance Co. of North America, 166 Mass. 189, 44 N. E. 211, 
 32 L. R. A. 615, 55 Am. St. Rep. 387 (1S96). Contra : Minnock v. Eureka Fire 
 & Marine Ins. Co., 90 Mich. 236, 51 N. W. 367 (1892). 
 
 A very few states still hold that a creditor beneficiary pannot sue in a 
 common-law action. Morgan v. Randolph & Clowes Co., 73 Conn. 396, .47 
 Atl. 658, 51 L. R. A. 653 (1900) ; Mellen v. Whipple, 1 Gray (Mass.) 317 
 (1854) ; Exchange Bank of St. Louis v. Rice, 107 Mass. 37, 9 Am. Rep. 1 
 (1871) ; Borden v. Boardman, 157 Mass. 410, 32 N. E. 469 (1892) ; Minnock 
 V. Eureka Fire & Marine Ins. Co., 90 Mich. 286., 51 N. W. 367 (1892) ; Ed- 
 wards V. Thoman, 187 Mich. 361, 153 N. W. 808 (1915). ' 
 
1056' THIRD PARTY BENEFICIARIES (Gh. 6 
 
 payment of the bond and mortgage except so far as the same were a 
 charge upon his interest in the lands, conveyed the lands subject to 
 the mortgage, and the conveyance recited ' that the grantees therein 
 assumed the mortgage, and were to pay off the same as a part of the 
 consideration of such conveyance, and it was held that as the grantor 
 in that conveyance was not personally' liable to the holder of thfe piort- 
 gage to pay the same, the grantees were not liable to the holder of such 
 riiortgage for the deficiency upon a foreclosure and sale of the mort- 
 gaged premises. It was conceded by the chancellor that if the grantor 
 had been personally liable to the holder of the mortgage for the pay- 
 ment of the mortgage debt, the holder of such mortgage would have 
 been entitled in equity to the benefit of the agreeinent recited in such 
 conveyance, to pay off the mortgage and to a decree over against the 
 grantees for the deficiency. This would have been in accordance with 
 a well-established rule in equity, which gives to the creditor the right 
 of subrogation to and the benefit of any security held by a surety for 
 the reinforcement of the principal debt, and' in the case supposed, and 
 by force of the agreement recited in the conveyance, the grantee would 
 have become the principal debtor, and the grantor Would be a quasi 
 surety for the payment of the mortgage debt. Halsey v. Reed, 9 
 Paige, 446 ; Curtis v. Tyler, 9 Paige, 432 ; Burr v. Beers, 24 N. Y. 178, 
 80 Am. Dec. 327. King v. 'U^hitely was followed, and the same rule 
 applied by an undivided court in Trotter v. Hughes, 12 N. Y. 74, 
 62 Am. Dec. 137, and the same case was cited with approval in Garn- 
 sey V. Rogers, 47 N. Y. 233, 7 Am. Rep. 440. 
 
 The clause in the conveyance in Trotter v. Hughes was not in terms 
 precisely like that in King v. 'Whitely, or in the grant under consid- 
 eration. The undertaking by the grantees to pay the mortgage debt 
 as recited, was not in express terms or as explicit as in the other con- 
 veyances, But the recital was, I think, sufficient to justify the in- 
 ference of a promise to pay the debt, and so it must have been re- 
 garded by the Gourt. The case was not distinguisTied by the Gourt 
 in any of its circumstances from King v. Whitely, but was supposed 
 to be on all fours with and governed by it. Had the grantor in that 
 case been personally boUnd for the payment of the debt, I am of the 
 opinion that an action would have been sustained against the grantee 
 upon a promise implied from the terms of the grant accepted by him 
 to pay it and indemnify the grantor. It must have been so regarded 
 by this Gourt, otherwise no question would have been made upon it, 
 and the Gourt would not have so seriously and ably fortified and ap- 
 plied the doctrine of King v. Whitely. A single suggestion that there 
 was no undertaking by the grantee and no personal liability for the 
 payment of the debt assumed by him, would have disposed of the 
 claim to charge him for the deficiency upon the sale of the inortgaged 
 premises. The rule which exempts the grantee of mortgaged premises 
 subject to a mortgage, the payment of which is assumed in considera- 
 tion of the conveyance as between him and his grantor, from liability 
 
 & 
 
Ch. 6) THIRD PAKTY BBNBFICIAEIES 1057 
 
 to the holder of the mortgage when the grantee is not bound in law or 
 equity for the payment of the mortgage, is founded in reason and 
 principle, and is not inconsistent with that class of cases in which it 
 has been held that a promise to one for the benefit of a third party 
 may avail to give an action directly to the latter against the promisor, 
 of which Lawrence v. Fox, 20 N. Y. 268, is a prominent example. To 
 give a third party who may derive a benefit from the performance of 
 the promise an action, there must be, first, an intent by the promisee 
 to secure some benefit to the third party; and, second, some privity 
 between the two, the promisee and the party to be benefited, and 
 some obligation or duty owing from the former to the latter which 
 would give him a legal or equitable claim to the benefit of the promise 
 or an equivalent from him personally. 
 
 It is true there need be no privity between the promisor and the 
 party claiming the benefit of the undertaking, neither is it necessary 
 that the latter shovild be privy to the consideration of the promise, 
 but it does not follow that a mere volunteer can avail himself of it. A 
 legal obligation or duty of the promisee to him will so connect him 
 with the transaction as to be a substitute for any privity with the 
 promisor, or the consideration of the promise, the obligation of the 
 promisee furnishing, an evidence of the intent of the latter to benefit 
 him, and creating a privity by substitution with the promisor. A 
 mere stranger cannot intervene and claim by action the benefit of a 
 contract between other parties. There must be either a new consid- 
 eration or some prior right or claim against one of the contracting 
 parties by which he has a legal interest in the performance of the 
 agreement. 
 
 It is said in Garnsey v. Rogers, 47 N. Y. 233, 7 Am. Rep. 440, that 
 it is not every promise made by one person to another from the per- 
 formance of which a third person would derive a benefit that gives 
 a right of action to such third person, he being privy neither to the 
 contract nor tjie consideration. In the language of Rapallo, J., "to 
 entitle him to an action, the contract must have been made for his 
 benefit. He must be the party intended to be benefited." See, also, 
 Turk v. Ridge, 41 N. Y. 201, and Merrill v. Green, 55 N. Y. 270, 
 in which, under similar agreements, third parties sought to main- 
 tain an action upon engagements by the performance of which they 
 would be benefited, but to which they were not parties and failed. 
 The courts are not inclined to extend the doctrine of Lawrence v. 
 Fox to cases not clearly within the principle of that decision. Judges 
 have differed as to the principle upon which Lawrence v. Fox and 
 kindred cases rest, but in every case in which an action has been sus- 
 tained there has been a debt or duty owing by the promisee to the 
 party claiming to sue upon the promise. Whether the decisions rest 
 upon the doctrine of agency, the promisee being regarded as the agent 
 for the third party, who, by bringing his action adopts his acts, or 
 upon the doctrine of a trust the promisor being regarded as having 
 
 COEBIN OONT 67 
 
1058' THIRD PARTY BENEFICIARIES (Ch. © 
 
 received money or 'other thing for the third party is not material; 
 In either case there must be a legal right, founded upon some obliga- 
 tion of the promisee, in the third party, to adopt and claim the promise 
 as made for his benefit. 
 
 In Lawrence v. Fox a prominent question was made in limine, 
 whether the debt from Holly to the plaintiff was sufficiently proved 
 by the confession of Holly made at the time of the loan of the money 
 to the defendant. It was assumed that if there was no debt proved 
 the action would not lie, and the declaration of Holly the debtor was 
 held sufficient evidence of the debt. Gray, J., said "AH the defendant 
 had the right to demand in this case was evidence which as between 
 Holly and the plaintiff was competent to establish the relation be- 
 tween them of debtor and creditor." In Burr v. Beers, 24 N. Y. 178, 
 80 Am. Dec- 327, and Thorp v. Keokuk Coal Co., 48 N. Y. 253, the 
 grantor of the defendant was personally liable to pay the mortgage 
 to the plaintiff, and the cases were therefore clearly within the principle 
 of Lawrence v. Fox, Halsey v. Reed, and Curtis v. Tyler, supra. See 
 also Bosworth, J., Doolittle v. Naylor, 15 N. Y. Super. Ct. 225; and 
 Ford V. David, 14 N. Y. Super. Ct. 569. It is claimed that King v. 
 Whitely and the cases following it were overruled by Lawrence v. 
 Fox. But it is very clear -that it was not the intention to overrule 
 them, and that the cases are not inconsistent. The doctrine of Law- 
 rence V. Fox, although questioned and criticised, was not first adopted 
 in this State by the decision of that case. It was expressly adjudged 
 as early as 1825 in Farley v. Cleveland, 4 Cow. 432, 15 Am. Dec. 387, 
 affirmed in the Court for the correction of errors in 1827, per totam 
 curiam, and reported in Cleveland v. Farley, 9 Cow. 639. The chan- 
 cellor was not ignorant of these decisions when he decided King v. 
 Whitely, nor was Denio, J., and his associates unaware of them 
 when Trotter v. Hughes was decided, and Gray, J., in Lawrence v. 
 Fox says the case of Farley v. Cleveland had never been doubted. 
 
 The Court below erred in giving judgment against, the appellant 
 for the deficiency after the sale of the mortgaged prfemises, and so 
 much of the judgment as directs her to pay the same must be reversed 
 with costs. 
 
 All concur except Earl, J., dissenting. 
 
 Judgment accordingly.* 
 
 8 Similar decisions were rendered in Dumherr v. Rau, 135 N. Y 219 32 N. 
 B. 49 (1892) ; Lorillard v. Clyde, 122 N. Y. 498, 25 N. E. 917, 10 L. K. A. 113 
 (1890) ; Merchants' Union Trust Go. v. New Philadelphia Graphite Co., 10 
 Del. Ch. 18, 83 Atl. 520 (1912) ; Kramer v. Gardner, 104 Minn. 370, 116 N. W. 
 925, 22 r,. K. A. (N. S.) 492 (1908) ; Georgia State Savings Ass'n v. Bearing, 
 128 Ark. 149, 193 S. W. 512 (1917). 
 
 This case has also been cited with approval in many cases holding that no 
 action lies in favor of a citizen against a water company on the latter's con- 
 tract with a municipality to supply water to citizens.. These cases are collected 
 and discussed in 19 Yale Law Journal, 425 (1910). 
 
Ch. 6) THIRD PARTY BENEFICIARIES 
 
 1059 
 
 NATIONAL BANK v. GRAND LODGE. 
 (SupremeCourtof the United states, 1878. 98 U.S. 123, 2S L. Ed. 75.) 
 
 This is an action by the. Second National Bank of St. Louis, Mo., 
 • against the Grand Lodge of Missouri of Free and Accepted Ancient 
 Masons, to compel the payment of certain coupons formerly attached 
 to bonds issued in June, 1869, by the Masonic Hall Association, a cor- 
 poration existing under the laws of the State of Missouri, in relation 
 to which bonds the Grand Lodge, October l4th, 1869, adopted the 
 following resolution: 
 
 "Resolved, That this Grand Lodge assume the payment of the 
 $200,000 bonds, issued by the Masonic Hall Association,, provided 
 that stock is issued to the Grand Lodge by said association to the 
 amount of said assumption of payment by this Grand Lodge as the 
 said bonds are paid." 
 
 The Court below instructed the jury that independently of the 
 question of the power of the Grand Lodge to pass the resolution, it 
 was no foundation for the present action, and directed a verdict for 
 the defendant. 
 
 The jury returned a verdict in accordance with the direction of the 
 Court, and judgment having been entered thereon, the plaintiff sued 
 out this writ of error. 
 
 Strong, J. It is unnecessary to consider the several assignments of 
 error in detail, for there is an insurmountable difficulty in the way of 
 the plaintiff's recovery. The resolution of the Grand Lodge was but 
 a proposition made to the , Masonic Hall Associationj and, when 
 accepted, the resolution and acceptance constituted at most only an ex- 
 ecutory contract inter partes. It was a contract made for the benefit 
 of the association and of the Grand Lodge — made that the latter might 
 acquire the ownership of stock of the former, and that the former 
 might obtain relief from its liabilities. The holders of the bonds were 
 not parties to it, and there was no privity between them and the lodge. 
 They may have had an indirect interest' in the performance of the 
 undertakings of the parties, as they would have in an agreement by 
 which the lodge should undertake to lend money to the association, or 
 contract to buy its stock to enable it to pay its debts ; but that is a very 
 different thing from the privity necessary to enable them to enforce the 
 contract by suits in their own names. We do not propose to enter 
 at large upon a consideration of the inquiry how far privity of con- 
 tract between a plaintiff and defendant is necessary to the mainte- 
 nance of an action of assumpsit. The subject has been much debated, 
 and the decisions are not all reconcilable. No doubt the gei^eral rule 
 is that such a privity must exist. But there are confessedly many ex- 
 ceptions to it. One of them, and by far the most frequent one, is the 
 case where, under a. contract between two persons, assets have come to 
 the promisor's hands or under his control which in equity belong 
 
1060 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 to a third person. In such a case it is held that the third person may 
 sue in his own name. But then the suit is founded rather on the im- 
 plied undertaking the law raises from the possession of the assets, than 
 on the express promise. Another exception is where the plaintiff is 
 the beneficiary solely interested in the promise, as where one person 
 contracts with another to pay money or deliver some valuable thing to 
 a third. But where a debt already exists from one person to another, 
 a promise by a third person to pay such debt being primarily for the 
 benefit of the original debtor, and to relieve him from liability to 
 pay it (there being no novation), he has a right of action against the 
 promisor for his own indemnity ; and if the original creditor can also 
 sue, the prqmisor would be liable to two separate actions, and therefore 
 the rule is that the original creditor cannot sue.° His case is not an ex- 
 ception from the general rule that privity of contract is required. 
 There are some other exceptions recognized, but they are unimportant 
 now. The plaintiff's case is within none of them. Nor is he sole bene- 
 ficiary of the contract between the association and the Grand Lodge. 
 The contract was made, as we have said, for the benefit of the asso- 
 ciation, and if enforceable at all, is enforceable by it. That the several 
 bondholders of the association are not in a situation to oue upon it 
 is apparent on its face. Even as between the association and the Grand 
 Lodge, the latter was not bound to pay anything except so far as 
 stock of the former was delivered or tendered to it. The promise to 
 pay and the promise to deliver the stock were not independent of each 
 other. They were concurrent and dependent. Of this there can be 
 no doubt. The resolution of the lodge was to assume the pa3?ment of 
 the $200,000 bonds, issued by the association, "Provided, that stock, 
 is issued to the Grand Lodge by said association to the amount of said 
 assumption," * * * "as said bonds are paid." Certainly the 
 obligation of the lodge was made contingent upon the issue of the 
 stock, and the consideration for payment of the debt to the bondholders 
 was the receipt of the stock. But the bondholders can neither dehver 
 it nor tender it; nor can they compel the association to deliver it. If 
 they can sue upon the contract, and enforce payment by the Grand 
 Lodge of the bonds, the contract is wholly changed, and the lodge 
 is compelled to pay whether it gets the stock or not. To this it cannot 
 be presumed the lodge would ever have agreed. It is manifest, there- 
 fore, that the bondholders of the association are not in such privity 
 with the lodge, and have no such interest in the contract as to warrant 
 their bringing suit in their own names. 
 
 Hence the present action cannot be sustained, and the Circuit 
 Court correctly directed a verdict for the defendant. 
 
 Judgment affirmed. 
 
 » By statute, this rule seems to prevail In the Virginias. Newberry Land 
 Co. V. Newberry, 95 Va. 119, 27 S. E. 899 (1897) ; King v. Scott, 76 W. Va. 58, 
 84 S. E. 954 (1915). It is reported to be repealed by a later Code in Virginia. 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1061 
 
 SEAVER V. RANSOM et al. 
 
 (Court of Appeals of New York, 1918. 224 N. Y. 233, 120 N. E. 639, 2 A. L. 
 
 R. 1187.) 
 
 Action by Marion E. Seaver against Matt C. Ransom and another, 
 as executors, etc., of Samuel A. Beman, deceased. From a judgment 
 of the Appellate Division (180 App. Div. 734, 168 N. Y. Supp. 454), 
 affirming judgment for plaintiff, defendants appeal. Affirmed. 
 
 Pound, J. Judge Beman and his wife were advanced in years. Mrs. 
 Beman was about to die. She had a small estate, consisting of a house 
 and lot in Malone and Httle else. Judge Beman drew his wife's will 
 according to her instructions. It gave $1,000 to plaintiff, $500 to one 
 sister, plaintiff's mother, and $100 each to another sister and her son, 
 the use of the house to her husband for life, and remainder to the 
 American Society for the Prevention of Cruelty to Animals. She 
 named her husband as residuary legatee and executor. Plaintiff was 
 her niece, 34 years old in ill health sometimes a member of the Beman 
 household. When the will was read to Mrs. Beman, she said that it 
 was not as she wanted it. She wanted to leave the house to plaintiff. 
 She had no other objection to the will, but her strength was waning, 
 and, although the judge offered to write another will for her, she said 
 she was afraid she would not hold out long enough to enable her to 
 sign it. So the judge said, if she would sign the will, he would leave 
 plaintiff enough in his will to make up the difference. He avouched 
 the promise by his uplifted hand with all solemnity and his wife then 
 executed the will. When he came to die, it was found that his will 
 made no provision for the plaintiff. 
 
 This action was brought, and plaintiff recovered judgment in the 
 trial court, on the theory that Beman had obtained property from his 
 wife and induced her to execute the will in the form prepared by him 
 by his promise to give plaintiff $6,000, the value of the house, and 
 that thereby equity, impressed his property with a trust in favor of 
 plaintiff. Where a legatee promises the testator that he will use prop- 
 erty given him by the will for a particular purpose, a trust arises. 
 O'Hara v. Dudley, 95 N. Y. 403, 47 Am. Rep. 53 ; Trustees of Am- 
 herst College v. Ritch, 151 N. Y. 282, 45 N. E. 876, 37 L. R. A. 305 ; 
 Ahrens v. Jones, 169 N. Y. 555, 62 N. E. 666, 88 Am. St. Rep. 620. 
 Beman received nothing under his wife's will but the use of the house 
 in Malone for life. Equity compels the application of property thus 
 obtained to the purpose of the testator, but equity cannot so impress 
 a trust, except on property obtained by the promise. Beman was 
 bound by his promise, but no property was bound by it; no trust in 
 plaintiff's favor can be spelled out. 
 
 An action, on the contract for damages, of to make the executors 
 trustees for performance, stands on different ground. Farmers' Loan 
 & Trust Co. V. Mortimer, 219 N. Y. 290, 294, 295, 114 N. E. 389, 
 
1062 THIRD PAETT BBNEFICIAEIBS (Ch. 6 
 
 Ann. Cas. 19i8E, 1159. The Appellate Division properly passed to 
 the consideration of the question whether the judgment could stand 
 Upon the promise made to the wife, upon a valid consideration, for 
 the sole benefit of plaintiff. The judgment of the trial court was af- 
 firmed by a return to the general doctrine laid down in the great case 
 of, Lawrence v. Fox, 20 N. Y. 268, which has since been limited aS 
 herein indicated. 
 
 Contracts for the benefit of third persons have been the prolific 
 source of judicial and academic discussion. Williston, Contracts for 
 the Benefit of a Third Person, 15 Harvard L,aw Review, 767; Corbin, 
 Contracts for the Benefit of Third Persons, 27 Yale Law Journal, 
 1008. The general rule, both in law and equity (Phalen v. United 
 States Trust Co., 186 N. Y. 178, 186, 78 N. E. 943, 7 L. R. A. [N. 
 S.] 734, 9 Ann. Cas. 595), was that privity between a plaintiff and a 
 defendant is necessary to the maintenance of an action on the con- 
 tractv The consideration must be furnished by the party to whom the 
 promise was made. The contract cannot be enforced against the 
 third party, and therefore it cannot be enforced by him. On the other 
 hand, the right of the beneficiary to sue on a contract made expressly 
 for his benefit has been fully recognized in many Americaii jurisdic- 
 tions, either by judicial decision or by legislation, and is said to be "the 
 prevailing rule in this country." Hendrick v. Lindsay, 93 U. S. 143, 
 23 L- Ed. 855 ; Lehow v. Simonton, 3 Colo. 346. It has been said that 
 "the establishment of this doctfine has been gradual, and is a victory 
 of practical utility over theory, of equity over technical subtlety." 
 Brantly on Contracts (2d Ed.) p. ,253. The reasons for this view are 
 that it is just and practical to permit the person for whose benefit the 
 contract is made to enforce it against one whose duty it is to pay. 
 Other jurisdictions still adhere to the present English rule (7 Hals- 
 bury's Laws of England, 342, 343 ; Jenks' Digest of English Civil 
 Law, § 229) that a contract cannot be enforced by or against a per- 
 son who is not a party (Exchange Bank v. Rice, 107 Mass. -37, 9 Am. 
 Rep. 1). But see, also, Forbes v. Thorpe, 209 Mass. 570, 95 N. E. 
 955 ; Gardner v. Denison, 217 Mass, 492, 105 N. E. 359, 51 L. R. A. 
 (N. S.) 1108. 
 
 In New York the right of the beneficiary to sue on contracts made 
 for his benefit is not clearly or simply defined. It is at present con- 
 fined: First. To cases where there is a pecuniary obligation running 
 from the promisee to the beneficiary, "a legal right founded upon some 
 obligation of the promisee in the third party to adopt and claim 
 the promise as made for his benefit." Farley v. Cleveland, 4 Cow. 
 432, 15 Am. Dec. 387; Lawrence v. Fox, supra; Garnsey v. 
 Rogers, 47 N. Y. 233, 7 Am. Rep. 440; Vrooman v. Turner, 69 
 N. Y. 280, 25 Am. Rep. 195; LoriUard v. Clyde, 122 N. Y. 498, 
 25 N. E. 917, 10 L. R. A. 113; Durnherr v. Rau, 135 N. Y. 219, 
 32 N. E. 49; Townsend v. Rackham, 143 N. Y. 516, 38 N. E. 731; 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1063 
 
 Sullivan v. Sullivan, 161 N. Y. 554, 56 N. E. 116. Secondly. To 
 cases where the contract is made for the benefit of the wife (Bu- 
 chanan V. Tilden, 158 N. Y. 109, 52 N. E. 724, 44 E. R. A. 
 170, 70 Am. St. Rep. 454; Bouton v. Welch, 170 N. Y. 554, 63 N. E. 
 539)," affianced wife (De Cicco v. Schweizer, 221^ N. Y. 431, 117 N. 
 E. 807, E. R. A. 1918E, 1004, Ann. Cas. 1918C, 816), or child (Todd 
 V. Weber, 95 N. Y. 181, 193, 47 Am. Rep. 20; Matter of Kidd, 188 N. 
 Y. 274, 80 N. E. 924) of a party to the contract. The close relation- 
 ship cases go back to the early King's Bench Case (1677), long since 
 repudiated in England, of Button v. Poole, 2 Lev. 211. See Schem- 
 erhom v. Vanderheyden, 1 Johns. 139, 3 Am. Dec. 304. The natural 
 and moral duty of the husband or parent to provide for the future 
 of wife or child sustains the action on the contract made for their 
 benefit.^" "This is the farthest the cases in this state have gone," 
 says Cullen, J., in the marriage settlement ca!se of Borland v. Welch, 
 162 N. Y. 104, 110, 56 N. E. 556. 
 
 The right of the third party is also upheld in, thirdly, the public 
 contract cases (Eittle v. Banks, 85 N. Y. 258; Pond v. New Rochelle 
 Water Co., 183 N. Y. 330, 76 N. E. 211, 1 L. R. A. [N. S.] 958, 
 5 Ann. Cas. 504; Smyth v. City of New York, 203 N. Y. 106, 
 96 N. E. 409; Farnsworth v. Boro Oil & Gas Co., 216 N. Y. 40, 48, 
 109 N. E. 860; Rigney v. N. Y. C. & H. R. R. R. Co., 217 N. Y. 31, 
 111 N. E. 226; Matter of International Ry. Co. v. Rann, 224 N. Y. 
 83, 120 N. E. 153. Cf. German Alliance Ins. Co. v. Home Water 
 Supply Co., 226 U. S. 220, 33 Sup. Ct. 32, 57 L. Ed. 195, 42 L. R. A. 
 [N. S.] 1000), where the municipality seeks to protect its inhabitants 
 by covenants for their benefit; and, fourthly, the cases where, at the 
 request of a party to the contract, the promise runs directly to the 
 beneficiary although he does not furnish the consideration (Rector, 
 etc., V. Teed, 120 N. Y. 583, 24 N. E. 1014; F. N. Bank of Sing Sing v. 
 Chalmers, 144 N. Y. 432, 439, 39 N. E. 331 ; Hamilton v. Hamilton, 
 127 App. Div. 871, 875, 112 N. Y. Supp. 10). It may be safely said 
 that a general rule sustaining recovery at the suit of the third party 
 would include but few classes of cases not included in these groups, 
 either categorically or in principle. 
 
 The desire of the childless aunt to make provision for a beloved and 
 favorite niece differs imperceptibly in law or in equity from the moral 
 duty of the parent to make testamentary provision for a child. The 
 contract was made for the plaintifif's benefit. She alone is substan- 
 tially damaged by its breach. The representatives of the wife's estate 
 have, no interest in enforcing it specifically. It is said in Buchanan v. 
 Tilden that the common law imposes moral and legal obligations upon 
 the husband and the parent not measured by the necessaries of life. 
 It was, however, the love and affection or the moral sense of the hus- 
 
 1" See, also, Sloss-Sheffield Steel & Iron Co. v. Taylor, 16 Ala. App. 241, 77 
 South. 79 (1917). 
 
1064 THIRD PARTY BENEFICIARIES (Ch. 9 
 
 band and the parent that imposed such obligations in the cases cited, 
 rather than any common-law duty of husband and parent to wife and 
 child. If plaintiff had been a child of Mrs. Beman, legal obligation 
 would have required no testamentary provision for her, yet the child 
 could have enforced a covenant in her favor identical with the cove- 
 nant of Judge Beman in this case. De Cicco v. Schweizer, supra. 
 The constraining power of conscience is not regulated by the degree 
 of relationship alone. The dependent or faithful niece may have a 
 stronger claim than the affluent or unworthy son. No sensible theory 
 of moral obligation denies arbitrarily to the former what would be 
 conceded to the latter. We might consistently either refuse or al- 
 low the claim of both, but I cannot reconcile a decision in favor of the 
 wife in Buchanan v. Tilden, based on the moral obligations arising 
 out of near relationship, with a decision against the niece here on the 
 ground that the relationship is ' too remote for equity's ken. No 
 controlling authority depends upon so absolute a rule. In Sullivan v. 
 Sullivan, supra, the grandniece lost in a litigation with the aunt's 
 estate, founded on a certificate of deposit payable to the aunt "or in 
 case of her death to her niece" ; but what was said in that case of the 
 relations of plaintiff's intestate and defendant does not control here, 
 any more than what was said in Durnherr v. Rau, supra, on the re- 
 lation of husband and wife, and the inadequacy of mere moral^duty, 
 as distinguished from legal or equitable obligation, controlled the de- 
 cision in Buchanan v. Tilden. Borland v. Welch, supra, deals only 
 with the rights of volunteers under a marriage settlement not made 
 for the benefit of collaterals. Kellogg, P. J., writing for the court 
 below well said: "The doctrine of L,aw_rence v. Fox is progressive, 
 not retrograde. The course of the late decisions is to enlarge, not to 
 limit, the effect of that case." 
 
 The court in that leading case attempted to adopt the general doc- 
 trine that any third person, for whose direct benefit a contract was in- 
 tended, could sue on it. The headnote thus states the rule. Finch, J., 
 in Gifford v. Corrigan, 117 N. Y. 257, 262, 22 N. E. 756, 6 L. R. A. 
 610, 15 Am. St. Rep. 508, says that the case rests upon that broad 
 proposition; Edward T. Bartlett, J., in Pond v. New Rochelle Water 
 Co., 183 N. Y. 330, 337, 76 N. E. 211, 213, 1 L,. R. A. (N. S.) 958, 5 
 Ann. Cas. 504, calls it "the general principle" ; but Vrooman v. Turn- 
 er, supra, confined its application to the facts on which it was decided. 
 "In every case in which an action has been sustained," says AUep, J., 
 "there has been a debt or duty owing by the promisee to the party 
 claiming to sue upon the promise." 69 N. Y. 285, 25 Am. Rep. .195. 
 As late as Townsend v. Rackham, 143 N. Y. 516, 523, 38 N. E. 731, 
 733, we 'find Peckham, J., saying that, "to maintain the action by the 
 third person, there must be this liability to him on the part of the 
 promisee." Buchanan v. Tilden went further than any case since 
 Lawrence v. Fox in a desire to do justice rather than to apply with 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1065 
 
 technical accuracy strict rules calling for a legal or equitable obliga- 
 tion. In Embler v. Hartford Steam Boiler Inspection & Ins. Co., 
 158 N. Y. 431, 53 N. E. 212, 44 L. R. A. 512, it may at least be said 
 that a majority of the court did not avail themselves of the opportu- 
 ■ nity to concur with the views expressed by Gray, J., who wrote the 
 dissenting opinion in Buchanan v. Tilden, to the effect that an employe 
 could not maintain an action on an insurance policy issued to the 
 employer which covered injuries to employes. 
 
 In Wright v. Glen Telephone Co., 48 Misc. Rep. 192, 195, 95 N. Y. 
 Supp. 101, the learned presiding justice who wrote the opinion in this 
 case said at Trial Term: "The right of a third person to recover 
 upon a contract made by other parties for his benefit must rest upon 
 the peculiar circumstances of each case rather than upon the law of 
 some other case." "The case at bar is decided upon its peculiar 
 facts." Edward T. Bartlett, J., in Buchanan v. Tilden. 
 
 But, on principle, a sound conclusion may be reached. If Mrs. Be- 
 man had left her husband the house on condition that he pay the plain- 
 tiff $6,(XX), and he had accepted the devise, he would have become 
 personally liable to pay the legacy, and plaintiff could have recovered 
 in an action at law against him, whatever the value of the house. 
 Gridley v. Gridley, 24 N. Y. 130; Brown v. Knapp, 79 N. Y. 136, 143 ; 
 Dinan v. Coneys, 143 N. Y. 544, 547, 38 N. E. 715 ; Blackmore v. 
 White [1899] 1 Q. B. 293, 304. That would be because the testatrix 
 had in substance bequeathed the promise to plaintiff, and not because 
 close relationship or moral obligation sustained the contract. The 
 distinction between, an implied promise to a testator for the benefit 
 of a third party to pay a legacy and an unqualified promise on a 
 valuable consideration to make provision for the third party by will 
 is discernible, but not obvious. The tendency of American authority 
 is to sustain the gift in all such cases and to permit the donee bene- 
 ficiary to recover on the contract. Matter of Edmundson's Estate 
 (1918) 259 Pa. 429, 103 Atl.-277, 2 A. L. R. 1150. The equities are 
 vfith the plaintiff, and they may be enforced in this action, whether it 
 be regarded as an action for damages or an- action for specific per- 
 formance to convert the defendants into trustees for plaintiff's bene- 
 fit under the agreement. 
 
 The judgment should be affirmed, with costs. 
 
 HoGAN, CArdozo, and Crane, JJ., concur. Hi^coCK, C. J., -and 
 Collin and Andrews, J J., dissent. 
 
 Judgment affirmed. 
 
 11 
 
 11 Action by a sole (and donee) beneficiary was sustained in Rogers v. 
 Galloway Female College, 64 Ark. 627, 44 S. W. 454, 39 L. R. A. 636 (1898), 
 beneficiary of a /charitable subscription ; City of St. Louis to use of Glencoe 
 Lime & Cement Co. v. Von Pliul, 133 Mo. S61, 34 S. W. 843, 54 Am. St. Rep. 
 695 (1895) ; Todd v. Weber, 95 N. Y. 181, 47 Am. Eep. 20 (1884), pronuse 
 to the motber of plaintiff to furnish support; Wbitehead v. Burgess, 61 N. J. 
 Law, 75, 38 Atl. 802 (1897) ; Bouton v. Welch, 170 N. T. 554, 63 N. E. 530 
 
1066 THIRD PAKTT BBNEFICIAKIBS (Ch. 6 
 
 In re EDMUNDSON'S ESTATE. 
 
 (Supreme Court of Pennsylvania, 1918. 259 Pa. 429, 103 Atl. 277, 2 A. L. 
 
 E. 1150.) 
 
 E. R. Edmundson and Ira H. Edmundson appeal from a decree dis- 
 missing exceptions to adjudication in the estate of Phebe Edmundson, 
 deceased, and sustaining the findings of the auditing judge. Affirmed. 
 
 Mestrezat, J. This is an appeal from the decree of distribution 
 made by the orphans' court of Allegheny county, allowing a claim 
 against the estate of Mrs. Phebe Edmundson, deceased. In 1892 J. 
 
 A. Herron purchased a house and lot in the city of Pittsburgh for the 
 consideration of $5,500, and, at his suggestion, the title to the prop- 
 erty was taken in the name of his wife, Carrie E. Herron, who was a 
 daughter of Mrs. Edmundson, the decedent. Three thousand six 
 hundred dollars of the purchase money was borrowed on a building 
 and loan association mortgage for that amount on which payments of 
 principal and interest were made at various times by Mr. Herron until 
 July, 1894. In that year Mr. and Mrs. Herron were divorced, and in 
 the autumn of 1895 Mrs. Herron was married to Joseph Stadtfeld. 
 By a deed, dated November 16, 1895, Mr. and Mrs. Stadtfeld convey- 
 ed the house and lot in question to Mrs. Edmundson, tlie consideration 
 stated being $5,500, subject to liens and incumbrances. 
 
 At the audit of the account filed by the executor of Mrs. Edmund- 
 son, Carrie Herron, now Mrs. Carrie Cotton, daughter of Mrs. Carrie 
 E. Herron, presented for allowance a claim for $3,333.01, alleged to be 
 due her on an oral contract made by the decedent in 1895 with Mrs. 
 Carrie E. Herron, the mother of the claimant. It is alleged that in the- 
 autumn of 1895 Mrs. Edmundson agreed to take title to the property 
 in question under an express agreement made with Mrs. Herron that 
 Carrie Herron, then her infant daughter, should receive all that the 
 latter's father, J. A. Herron, had put into the property in case of a sale 
 
 (1902) ; Pond v. New Roehelle Water Co., 183 N. T. 330, 76 N. E. 211, 1 L. 
 
 B. A. (N. S.) 958, 5 Ann. Cas. 501 (1906), promise to a village for the benefit 
 of the inhabitants ; Rigney v. New York Cent. & H. R. R. Co., 217 N. Y. 31, 
 111 N. E. £26 (1916), same; Smyth v. New York. 203 N. Y. 108, 96 N. E. 409 
 (1911), same; Independent School Dist. of Le Mars v. Le Mars City Water & 
 Light Co., 131 Iowa, 14, 107 N. W. 944, 10 L. R. A. (N. S.) 859 (1906) ; Doll 
 V. Crume, 41 Neb. 655, 59 N. W. 806 (1894) ; Gorrell v. Greensborbi Water 
 Supply Co;, 124 N..C. 328, 32 S. E. 720, 46 L. R. A. 513, 70 Am. St. Rep. 598 
 (18§9) ; Twfeeddale v. TWeeddale, 116 Wis. 517, 93 N. W. 440, 61 L. R. A. 509, 
 96 Am. St. Rep. 1003 (1903) ; Simons v. Bedell, 122 Cal. 341, 55 Pac. 3, 68 Am. 
 St. Rep. 35 (1898), specific performance decreed. See, further, Kramer v. 
 Gardner, 104 Minn. 370, 116 N. W. 925, 22 L. R. A. (N. S.) 492 (1908) ; 
 Ery V. Ausman, 29 S. D. 30, 135 N. W. 708, 39 L. R. A. (N. S.) 151, Ann. Cas. 
 1914C, 842 (1912) ; Jenkins v. Chesapeake & O. R. Co., 61 W. Va. 597, 57 S. 
 E. 48, 49 L. R. A. (N. S.) 1166, 11 Ann. Cas. 967 (1907). Estate of Younger- 
 man, 136 Iowa, 488, 114 N. W. 7, 15 Ann. Cas. 245 (1907) ; McBride v. West- 
 ern Pennsylvania Paper Co., 263 Pa. 345, 106 Atl. 720 (1919). 
 
 An action on a life insurance policy can everywhere be maintained by the 
 beneficiary in his own name. In England and Massachusetts this rule is 
 established by statute ; in other jurisdictions, by judicial action. 
 
■Ch. 6) THIRD PARTY BENEFICIARIES 1067 
 
 by Mrs. Edmundson during her lifetime, or if the property was not 
 sold by Mrs. Edmundson she would leave to Carrie Herron the full 
 amount invested therein by Mr. Herron at her death. With this un- 
 derstanding and agreement, it is claimed that Mrs. Stadtfeld and her 
 husband executed and delivered the deed for the property, subject to 
 the unpaid balance of the mortgage, to Mrs. Edmundson. WhUe this 
 deed recites a consideration of $5,500, it is contended, and the evi- 
 dence shows, that Mrs. Edm,undson paid nothing to the grantors or to 
 Mr. Herron for the property. Mrs. Edmundson did not sell the real 
 estate, and at her death bequeathed $1,000 to Mrs. Cotton. * * * 
 
 The questions raised by the assignments of error are : (a) The right 
 of the claimant to recover on the contract, she not being a party there- 
 to or to the consideration, and having no beneficial interest in the prop- 
 erty transferred; ^^ (b) the competency of the mother of the claimant 
 as a witness to prove the oral contract; and(c) the sufficiency of the 
 ■evidence to sustain the claim. 
 
 We think Carrie Herron, now Mrs. Cotton, can enforce, by an ac- 
 tion or proceeding instituted in her own name, the contract made by 
 her mother with the decedent for the benefit of the claimant. In 
 Howes v. Scott, 224 Pa. 7, 10, 73 Atl. 186, 187, it is said: "At com- 
 mon law no one could maintain an action upon a contract to which he 
 was not a party. This rule is well established in this country, and it 
 is recognized by both the state and federal courts. There are, how- 
 ever, exceptions to the rule which, in this state, are as well settled as 
 the rule itself. For nearly three-quarters of a century, since the de- 
 cision in Blymire v. Boistle, 6 Watts, 182, the decisions of this court 
 have uniformly recognized and enforced the exceptions whenever the 
 facts of a case required it." 
 
 In Adams v. Kuehn, 119 Pa. 76, 85, 13 Atl. 184, 186, Mr. Justice 
 Williams, delivering the opinion says : "Where one person enters into 
 a contract with another to pay money to a third, or to deliver some 
 valuable thing, and such third party is the only party interested in 
 the payment or the delivery, he can release the promisor from per- 
 formance or compel performance by suit." He then notes some of the 
 exceptions to the general rule at common law that a person could not 
 maintain an action upon a contract to which he was not a party, as 
 follows : "Among the exceptions, are cases where the promise to pay 
 the debt of a third person rests upon the fact that money or .property 
 is placed in the hands of the promisor for that particular purpose. 
 Also -where one buys out the stock of a tradesman and undertakes to 
 take the place, fill the contracts, and pay the debts of his vendor. 
 These cases, as well as the case of one who receives money or property 
 on the promise to pay or deliver to a third person, are cases in which 
 the third person, although not a p^arty to the contract, may be fairly 
 said to be a party to the consideration on which it rests. In good con- 
 
 12 Parts of the opinion, not applicable to question (a), are omitted. 
 
1068 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 science the title to the money or thing which is the consideration of the 
 promise passes to the beneficiary, and the promisor is turned in effect 
 into a trustee. But when the promise is made to and in relief of one 
 to whom the promise is made, upon a consideration moving from him, 
 no particular fund or means of payment being placed in the hands of 
 the promisor out of which the payment is to be made, there is no trust 
 arising in the promisor and no title passing to the third person. The 
 beneficiary is not the original creditor who is a stranger to the con- 
 tract and the consideration, but the original debtor who is a party to 
 both, and the right of action is in him alone." 
 
 Mrs. Edmundson took title to the land, as the court found, under an 
 oral agreement to give Mrs. Cotton, the. claimant, the amount of mon- 
 ey invested in the land by the claimant's father when the premises 
 might be sold or at the grantee's death. The premises were not sold 
 by the grantee, nor did she make provision by her will for pa3rment of 
 this claim. It is clear, therefore, that she failed to comply with the 
 contract on .her part. The claimant was not a party to the contract, 
 and had no beneficial interest in the property conveyed by her mother 
 to the decedent, but she is the only party beneficially interested in en- 
 forcing the claim secured by it. Mrs. Herroii, the grantor, has no 
 interest in the claim. The deed is absolute, and conveys the property 
 to the decedent without any conditions imposed for the payment of 
 any sum whatever to her. The promise contained in the agreement 
 was not in consideration of the payment of an existing indebtedness 
 due Mrs. Herron, the promisee, and therefore could not be released 
 or enforced by her.^' This proceeding is on the oral contract to compel 
 payment to the party beneficially interested by its terms, and not to 
 enforce any covenant or condition in the deed in favor of the grantors 
 or promisees therein. Being the only person beneficially interested in 
 the payment of the money secured thereby, the claimant can release 
 the promisor's estate from performance, or compel performance of 
 the terms of the contract by suit. While the deed showed the payment 
 of a consideration of $5,500, there was in fact nothing whatever paid, 
 or agreed to be paid, by the decedent to the grantors for the transfer 
 of the property. This was shown by parol evidence which was com- 
 petent for the purpose. Sargeant v. Nat. Life Insurance Co. of Ver- 
 mont, 189 Pa. 341, 346, 41 Atl. 351. We think the facts of this case 
 bring it within the doctrine of our decisions, and that the claimant 
 can recover in an actioij or proceeding instituted by her against the 
 estate of the decedent. * * * 
 
 Decree affirmed. 
 
 i» Of. Anonymous, Style, 6 (1646) ; ante, p. 1041, and note. 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1069 
 
 KNIGHTS OF THE MODERN MACCABEES v. SHARP. 
 
 (Supreme Court of Michigan, 1910. 163 Mich. 449, 128 N. W. 786, 33 L. R. 
 
 A. [N. S.] 780.) 
 
 Bill of interpleader by Knights of the Modern Maccabees against 
 Melinda Sharp and John L. Clink, guardian for L,ena Sharp and 
 others. Defendant Melinda Sharp appeals. Judgment reversed. 
 
 OsTRANDER, J. The issues raised by the answers to complainant's 
 bill of interpleader are sufficiently indicated in the opinion of the 
 learned trial judge, as follows : 
 
 "On July 23, 1896, Asa B. Sharp and his first wife, Minnie D. 
 Sharp, lived in the village of Yale, St. Qair county, Mich. At that 
 time he was 30 years of age and his wife 28. They had five small 
 children. He was a laboring man, and his family was dependent on 
 his earnings foi- support. Some time prior to the above-named date, 
 the husband and wife entered into a contract by the terms of which 
 he agreed he would take out a policy of insurance in complainant 
 order in which his wife should be named as beneficiary and so re- 
 main during her life and his, and, in case his wife should die before 
 he did, that their children should always remain the beneficiaries ; 
 the wife agreed she would take out a policy of insurance in the La- 
 dies of the Maccabees, a women's fraternal benefit association, in 
 which her husband should he named as beneficiary, and so remain 
 during his life and hers, and, in case her husband should die before 
 she did, that their children should always remain the beneficiaries. 
 The consideration for this agreement on the part of each was the 
 promise made by the other. The object of this mutual agreement 
 was the protection of the children. The testimony of one witness, 
 Grace O'Dell, goes to the extent of tending to show the existence 
 of this contract prior to the time the policies were issued to the hus- 
 band and wife, as hereinafter stated, while three other witnesses tes- 
 tify to having heard the husband and wife, in the presence of each 
 other, state what their contract in this regard had been after or 
 about the time of the issuance of the policies. 
 
 "On July 23, 1896, a policy for $1,000 was issued by complainant 
 association to Asa B. Sharp, in which his wife was named as bene- 
 ficiary, and on the same date a policy of like amount was issued by 
 the Ladies of the Maccabees to Minnie D. Sharp in which her hus- 
 band was named as beneficiary. After these policies were taken out, 
 Asa B. Sharp was laid up for a time with sickness, and was unable 
 to earn money, to support his farnily and to keep up his assessments, 
 or his wife's assessments, on these policies of insurance. It appears 
 from the testimony, that during this time, Minnie D. Sharp, relying 
 on the agreement with her' husband, as heretofore recited, went out 
 washing, housecleaning, and doing other work in order to obtain 
 money to support the family and to keep up the assessments on these 
 
1070' THIRD PARTY BENEFICIARIES (Ch. 6 
 
 policies, and it appears that she did for a time, at least, pay some 
 of the assessments on Her hu-sband's policy: On January 1, 19.02, 
 Minnie D. ^harp deceased, and the proceeds of her policy in the 
 Ladies of the Maccabees was paid to her husband, Asa B. Sharp, 
 who had remained the beneficiary in her certificate since the time it 
 was issued. On August 17, 1904, Asa B. Sharp married Melinda 
 Sharp, now his widow. At this time she was a widow with several 
 children, living on her own farm in Lapeer county, Michigan. On 
 April 19, 1906, Asa B. Sharp signed a paper revoking his former 
 designation of beneficiary in his policy, and designated Melinda 
 Sharp, his wife, as the new beneficiary. At the time he did this he 
 was sufficiently sound in his mind to know who was his former 
 beneficiary, to know to whom payment of benefits would be made in 
 case of his death without any change in his certificate, to know and 
 keep in mind his minor children, who were dependent upon him. 
 He had been sick before this date, and had not fully recovered his 
 physical strength, and perhaps, not his normal mental powers, but 
 he was sufficiently strong and sound mentally to transact and under- 
 stand ordinary business affairs. Asa B. Sharp surrendered his first 
 certificate, and on May 8, 1906, a new one was issued to him by com- 
 plainant association in which claimant, Melinda Sharp, was named as 
 beneficiary, and she remained as such designated beneficiary up to 
 the time of her husband's death." 
 
 He concludes that each of said mutual proniises was good consid- 
 eration .for the other, and that on the death of Minnie D. Sharp the 
 agreement became fully executed on her part and the husband con- 
 cluded from changiiig the beneficiary in his policy. 
 
 Two questions are presented, being, first, whether the parol agree- 
 ment alleged to have been made by and between Asa B. Sharp and 
 his first wife, Minnie, was in fact made; and second, whether, if 
 made, Asa was thereby precluded from making a change of bene- 
 ficiary. ■'^■* * * * 
 
 Assuming the mutual proniises never to change beneficiaries to 
 have been made as is claimed, upon what theory may the children 
 enforce the contract? No promise was made to them or any of 
 them, no consideration for the promise moved from them. The 
 agreement related to no fund in existence. No trust was created. 
 I find no reason for thinking that the parties were not at liberty, at- 
 any time,, to revoke their promises. It is true that after the death 
 of the mother there could be no mutual revocation, but, unless some 
 legal interest in the performance of the promise vested in the chil- 
 dren when the promise of the father was made, such interest never 
 vested. 
 
 It is the general rule in England that a third person cannot become 
 entitled by the contract itself to demand the performance of any 
 
 ■1* The discussion of the first question is omitted. The court appeared to 
 floubt the correctness of the trial court's finding of fact. 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1071 
 
 duty under the contract. Pollock, Prin. of Contracts (7th Ed.) 199. 
 The rule, contracts creating trusts aside, is the same whether such 
 enforcement is attempted at law or in equity. Ibid, 213. In this 
 state the English rule has been followed when the attempted en- 
 forcement of the contract by a third person was at law. Pipp v. 
 Reynolds, 20 Mich. 88; Turner v. McCarty, 22 Mich. 265; Hicks v. 
 McGarry, 38 Mich. 667; Hunt v. Strew, 39 Mich. 368; Hidden v. 
 Chappel, 48 Mich. 527, 12 N. W. 687; Edwards v. Clement, 81 Mich. 
 513, 45 N. W. 1107; Unneman v. Moross' Estate, 98 Mich. 178, 
 57 N. W. 103, 39 Am. St. Rep. 528. There is a well-recognized ex- 
 ception to the rule in England as to the provisions contained in a 
 settlement made upon and in consideration of marriage; for the 
 benefit of children to be born of the marriage. Whether there is, 
 in that jurisdiction, any other or further exception may be doubted. 
 Tweddle v. Atkinson, 1 B. & S. 393, 30 E. J. Q. B. 265. See, also, 
 Exchange Bank of St. Louis v. Rice, 107 Mass. 37, 9 Am. Rep. I ; 
 Marston v. Bigelow, 150 Mass. 45, 22 N. E. 71, 5 L. R. A. 43; and, 
 generally. Pollock, Prin. of Contracts (7th Ed.) chapter 5; Harri- 
 man on Contracts (2d Ed.) pp. 212-216; 9 Cyc. pp. 374-385. 
 
 The contention of appellees is that the principle underlying the 
 English exception to the rule should be extended, at least in equity, 
 so as to support the enforcement by children of contracts made by 
 their father or mother, with each other or with strangers, for their 
 benefit, and Buchanan v. Tilden, 158 N. Y. 109, 52 N. E. 724, 44 L. 
 R. A. 170, 7 Am. St. Rep. 454, is cited and relied upon. The courts 
 of New York do not follow the English rule. In the case cited, a 
 woman was permitted to recover in an action at law a sum of money 
 which defendant had promised her husband to pay to her upon a 
 consideration moving from the husband and others to the defendant 
 and others. The sum of money promised to be paid to the wife was 
 $50,000. The trial court gave her judgment. The appellate divi- 
 sion of the Supreme Court reversed the judgment and the Court 
 of Appeals reversed the appellate division' by a vote of four to three 
 of the judges. It will be discovered from the opinion that the points 
 involved, and concerning which the judges disagreed, were wheth- 
 er the promise made by the defendant to"^ the third person was upon 
 a valid consideration, and whether the promisee had a legal interest 
 that the contract be performed in favor of the plaintiff. If these 
 things appeared%hen, under the rule laid down in Lawrence v. Fox, 
 20 N. Y. 268, and Durnherr v. Rau, 135 N. Y. 219, 32 N. E. 49, 
 plaintiff was entitled to enforce the contract at law. The majority 
 opinion concludes with the statement, that "the case at bar is de- 
 cided upon its peculiar facts. We do not hold that the mere rela- 
 tion of husband and wife alone constituted a sufficient consideration 
 to enable the plaintiff to maintain this action. We deem it unnec- 
 essary to decide that question at this time. What we do hold is that 
 the equities of the plaintiff" — her interest as an adopted child who, 
 
1072 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 in conscience and equity,, 1)141 not legally, was entitled: to a share of 
 the fund sought to be recovered and which was recovered by de- 
 fendant with the aid of plaintiff's husband — "were such that, whei^ 
 considered in connection with the duty of her husband to provide 
 for her future, and with that purpose in view the money was pro- 
 cured for the defendant to institute and pursue the necessary liti- 
 gation to secure^the fund to which her equities related, they, all tak- 
 en together, were sufficient to sustain the plaintiff's action." 
 
 It cannot be said that the decision sustains appellees' contention, 
 and we are referred to none in which the general rule in force here 
 is recognized which does sustain it. The general rule in this state is 
 regarded as settled. I see no reason for saying that it is not the 
 same in proceedings at law and in equity. To what extent and un- 
 der what circumstances an exception to the rule should be recog- 
 nized in favor of the enforcement by children of contracts (other 
 than those creating trusts), made for their direct or indirect benefit, 
 by persons nearly related to them or by those sustaining the duty 
 to provide for them, is a subject which needs to be considered no 
 further than this, that the mutual promises of a father and mother, 
 who each holds the certificate of a beneficial association in which the 
 other is named as beneficiary, never to change the beneficiaries so 
 named, create no legal or equitable interest of the children in the 
 fund deriyed on the death of the surviving parent, although, if no 
 such change had been made^ they- would have been the legal bene- 
 ficiaries, and although the mutual promises of the parents contem- 
 plated that in such case they should be the legal beneficiaries. 
 
 The case presented is ruled precisely as it would be ruled if the 
 children, in the lifetime of the father, were seeking specific perform- 
 ance of the alleged contract or an injunction to restrain a threatened 
 change of beneficiaries. It may ,be added, although the suggestion 
 relates rather to the facts than to the law, that the children, appel- 
 lees, appear to have no particular claim, as against the appellant, to 
 equitable consideration. It is not claimed that appellant knew of 
 any arrangement between her husband and his former wife about 
 life insurance. His relation to her is a sufficient reason for insur- 
 ing his life for her benefit. If, instead of pursuing the method of 
 substituting one beneficiary for another, he had refused to pay as- 
 sessmentSj thus permitting the original certificate to lapse, and pro- 
 cured, one in which appellant was named as ben^piary, it is clear 
 that her right to any fund derived therefrom ana from his death, 
 would be unassailable. 
 
 The, decree below, except as to the provision for costs to com- 
 plainant, is reversed, and a decree will be entered in this court for 
 the payment of the fund to the appellant, who will recover of the 
 appellees the costs of both courts.^^ 
 
 i» Of. the late case of Preston v. Preston, 205 Mich. 646, 172 N. W. 371 
 ..(1919) ; Id., 207 Mich. 681, 175 N. W. 266 (1919). 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1073 
 
 GARDNER V. DENISON. 
 
 (Supreme Judicial Court of Massachusetts, 1914. 217 Mass. 492, 105 N. 
 E. 359, 51 L. R. A. [N. S.] 1108.) 
 
 Action by Edward Gerrish Gardner, by next friend, against Ar- 
 thur W. Denison, administrator. Directed verdict for defendant, 
 and plaintiff brings exceptions. Exceptions sustained. 
 
 RuGG, C. J. The facts upon which the plaintiff seeks to recover are 
 •these : His father, who was on friendly terms with the defendant's 
 testator, Edward Gerrish, told the latter, in November, 1900, that 
 the birth of a child was expected in his family. Mr. Gerrish, after 
 several interviews, promised that if a boy should be born and named 
 for him, Edward Gerrish Gardner, he would make some provision 
 for the child. When the child was born, on January 1, 1901, he was 
 named for the defendant's testator. On January 23, 1901, the plain- 
 tiff's father, at the request of Mr. Gerrish, wrote at the latter's dic- 
 tation the following: 
 
 "Jan. 23, 1901. 
 
 "I, Edward Gerrish, promise to place in trust for Joseph A. Gard- 
 ner's youngest son, born Jan. 1, 1901, $10,000, for naming his son 
 after me. Edward Gerrish Gardner." 
 
 No specific sum of money had been mentioned before. Mr. Ger- 
 rish then signed the paper in the presence of the plaintiff's father, 
 who since has had the possession and control of it. Mr. Gerrish 
 later lived in the family of the plaintiff's father and showed special 
 attention to the child, bestowing many gifts upon him and constantly 
 referring to him as "my boy." He died in 1906 at the age of 64 
 years, leaving an estate of more than $200,000, never having made 
 any provision for the benefit of the plaintiff. 
 
 The privilege of naming a child is a valid consideration for a 
 promise to pay money. The child had a direct and immediate in- 
 terest in his name and is more affected by it than any one else. He 
 loses the opportunity of receiving a more advantageous name, and 
 is compelled to bear whatever detriment may flow from the name 
 imposed upon him. The consideration moves in part from the child, 
 although he is not in a position personally to yield an assent to the 
 promise; at the time it is made. It is a general rule that one who is 
 not a party to a contract' cannot bring an action on it even though it 
 be made for his benefit. But the circumstances of the parties re- 
 specting the naming of a child are so peculiar, the nearness of the 
 relation so great, and the obligation resting on the father and moth- 
 er so important, and the consequence to the child so vital, that the 
 inference may be drawn that the father is acting in the interests of 
 and as agent for the son in making any contract as to giving him a 
 name. Felton v. Dickinson, 10 Mass. 287, as interpreted by Marston 
 V. Bigelow, 150 Mass. 45, 53, 22 N. E. 71, 5 L. R. A. 43. It was 
 
 COEBIN CONT 68 
 
107i THIRD PARTY BENEFICIARIES (Ch. 6 
 
 said in Eaton v. Libbey, 165 Mass. 218, at 220, 42 N. E. 1127, 52 
 Am. St. Rep. 511, respecting the naming of a child: "The right of 
 the parents is one which they have as the natural guardians of the 
 child, and they may be presumed to act in the matter for its interest. 
 If, for exercising the right in a particular manner, they receive a 
 reward which they recognize and treat as belonging to the child, 
 it should be corisidered as its property, even if the parents could 
 have kept the reward as their own." 
 
 This action is brought in the name of the son by his father as 
 next friend. That is a relinquishment of the father's personal rights, 
 as far as they ever might have been antagonistic to the son, and is 
 equivalent to an assertion that whatever he did was done as agent 
 for the son. The writing, signed by the plaintiff, while inartificially 
 expressed, in substance is a declaration by the defendant's testa- 
 tor that he acknowledges himself indebted in the sum of $10,000 for 
 the privilege granted him of having the plaintiff bear his name. The 
 words "in trust" in the absence of any definition of the terms of 
 any trust may be treated as meaning nothing more than the expres- 
 sion of a general purpose that the promise was for the benefit of 
 the plaintiff. No promisee being narned in the instrument, all the 
 attendant conditions may be examined for the purpose of determin- 
 ing to whom in fact the promise to pay was made. Such resort to 
 extrinsic circumstances is not for the purpose of changing the writ- 
 ing, but applying it to its proper object. Way v. Greer, 196 Mass. 
 237, 81 N. E. 1002 ; Willett v. Smith, 214 Mass. 494, 497, 101' N. E. 
 1058, and cases cited. Under all the circumstances we are of opin- 
 ion that the plaintiff was entitled to go to the jury. 
 
 Exceptions sustained.^" ■ 
 
 i« As to the rights of third party beneflciaries in general, Massachusetts 
 decisions have varied. At first, the general rule seemed to be that they could 
 sue at law. Later this rule seemed to be almost totally abandoned. In recent 
 cases, the third person has sometimes vrbn by the use of fiction or by using 
 the terminology and procedure of equity. The following cases will show this 
 development: Felton v. Dickinson, 10 Mass. 287 (1813), sole beneficiary and 
 blood relation; Arnold v. Lyman, IT Mass. 400, 9 Am. Dec. 154 (1821) ; Hall v. 
 Marston, 17 Mass. 575 (1822) ; Fitch v. Chandler, 4 Gush. (Mass.) 254 (1849) ; 
 Brewer v. Dyer, 7 Gush. (Mass.) 337 (1851), "the law, operating on the act 
 of the parties, creates the duty, establishes the privity, and implies the 
 promise and obligation"; Mellen v. Whipple, 1 Gray (Mass.) 317 (1854); 
 Adams v. Adams, 14 Allen (Mass.) 65 (1867) ; Exchange Bank of St. Louis v. 
 Kice, 107 Mass. 37, 9 Am. Rep. 1 (1871) ; Keed v. Paul, 131 Mass. 129 
 (1881) ; Paper Stock Disinfecting Co. v. Boston Disinfecting Co., 147 Mass. 
 318, 17. N. E. 554 (1888) ; Marston v. Bigelow, 150 Mass. 45, 22 N. E. 71, 5 
 L. K. A. 43 (1889) ; Dean v. American Legion of Honor, 156 Mass. 435, 31 N. 
 E. 1 (1892) ; Borden v. Boardman, 157 Mass. 410, 32 N. E. 469 (1892) ; 
 Eaton V. Libbey, 165 Mass. 218, 42 N. E. 1127, 52 Am. St.- Rep. 511 (1896) ; 
 Palmer Sav. Bank v. Insurance Co. of North America, 166 Mass. 189, 44 N. 
 E. 211, 32 L. R. A. 615, 55 Am. St. Rep. 387 (1896) ; Grime v. Borden, 166 
 Mass. 198, 44 N. E. 216 (1896) ; Forbes v. Thorpe, 209 Mass. 570, 95 N. E. 955 
 (1911) ; rNew England Structural Co. v. James Russell Boiler Works Co., 231 
 Mass. 274, 120 N. E. 852 (1918) ; Codman v. Deland, 231 Mass. 344, 121 N. E. 
 14 (1918). ' ■'- - 
 
Ch- 6) THIRD PARTY BENEFICIARIES 1075 
 
 THE HOME V. SELLING et al. 
 (Supreme Court of Oregon, 1919. 91 Or. 428, 179 Pac. 261.) 
 
 Action by The Home, a corporation, against Ben Selling and an- 
 other, executors, and others. Judgment for plaintiff, and defend- 
 ants appeal. Modified. 
 
 The plaintiff and the defendant Emanuel May Investment Compa- 
 ny are corporations. Emanuel May, the individual, died during the 
 progress of this litigation, and his personal representatives were 
 substituted. 
 
 On November 21, 1910, George E. Jacobs and his wife gave their 
 note to the plaintiff for $40,000, due ten years after date, with "in- 
 terest thereon quarter yearly at the rate of six per cent, per annum 
 from date until paid." They stipulated therein that, "in case suit 
 is instituted to collect this note or any part thereof," they would 
 pay a reasonable attorney's fee to be determined in the suit. At the 
 same time they gave their mortgage to the plaintiff on certain real 
 property in Portland, Or., and "covenanted and agreed to pay all 
 sums of money, the principal and interest, specified in said prom- 
 issory note at the time therein designated." On February 25, 1913, 
 they conveyed the premises to Emanuel May by deed duly executed, 
 containing a statement to the effect that the property was subject 
 to the mortgage mentioned, and that "the grantee herein in part 
 consideration for this conveyance assumes payment of the $40,000 
 unpaid balance of the first of said mortgages and the interest ac- 
 crued and to accrue thereon." Afterwards May conveyed to the in- 
 vestment company by deed which referred to the premises and the 
 mortgage and contained the following words : "And Emanuel May, 
 the grantor above named, does covenant to and with Emanuel May 
 Investment Company, the above-named grantee, its successors and 
 assigns that he is lawfully seized in fee simple of the above-granted 
 premises, that the above-granted premises are free from all incum- 
 brances except the following mortgages, which are as a part of the 
 purchase pi-ice, assumed by Emanuel May Investment Company. 
 
 * * * Mortgage of $40,000.00 in favor of The Home, a corpora- 
 tion, on the north half of lot 6 and the south half of lot 7, block 2, 
 city of Portland.." 
 
 This action was brought against Emanuel May, the grantee of Ja- 
 cobs and his wife and against the investment company. May's gran- 
 tee, to recover the interest on the note from November 21, 1915, 
 to February 21, . 1917, amounting to $3,000, and the plaintiff claims 
 $300 as a reasonable attorney's fee. A demurrer to the complaint 
 
 * * * was overruled. [The defendants then pleaded that they had 
 never made any contract with the plaintiff and that they had offered 
 to convey the mortgaged premises to him.] The court sustained a de- 
 murrer to each of these further and separate defenses. 
 
1076 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 The action was then tried, resulting in findings of fact substan- 
 tially as stated, with the addition that the court found that $200 is 
 a reasonable sum to be allowed as attorney's fee in the circuit court 
 for the collection of the interest, and the sum of $75 to be a rea- 
 sonable amount to be allowed as attorney's fee in the SUpfeme Court, 
 and rendered judgment against the defendants, the investment com- 
 pany directly, and the others in their respective capacities, for $3,- 
 000 and for the attorney's fees as indicated above. The defendants 
 appeal. i"' 
 
 Burnett, J. (after stating the facts as above). One of the principal 
 questions to be determined is whether or not the defendants con- 
 tracted to pay the mortgage, and whether the mortgagee can main- 
 tain an action directly against them. 
 
 According to the decisions in this state, where one accepts a deed 
 which not only recites the mortgage, but adds that the grantee as- 
 sumes it, he becomes personally liable to pay the mortgage. Miles 
 V. Miles, 6 Or. 266, 269, 25 Am. Rep. 522; Walker v. Goldsmith, 7 
 Or. 161, 181 ; Haas v. Dudley, 30 Or. 355, 48 Pac. 168 ; Farmers' 
 National Bank v. Gates, 33 Or. 388, 54 Pac. 205, 72 Am. St. Rep. 
 724; Ploffman v. Habighorst, 49 Or. 379, 391, 89 Pac. 952, 91 Pac. 
 20. It is plain, therefore, that the acceptance of the deeds mention- 
 ed, containing the clauses already quoted, made May and the in- 
 vestment company personally liable to pay the mortgage debt. 
 
 The original general rule was that one who is not a party to a 
 contract cannot bring an action on it in a court of law, although he 
 might ije benefited by its fulfillment. The leading case cited by the 
 defendants is Keller v. Ashford, 133 U. S. 610, 10 Sup. Ct. 494, 33 
 L. Ed. 667. [This case was then stated and distinguished.] 
 
 In later cases, notably Willard v. Wood, 135 U. S. 309, 10 Sup. 
 Ct. 831, 34 L. Ed. 210, the principle was applied that the law of 
 the forum governed the remedy, and that as the litigation in that 
 suit was commenced in the District of Columbia the remedy would 
 be in equity, although in New York, where the contract was made, 
 an action at law would lie by the mortgagee against the grantee 
 in such instances. Afterwards, in Union Life Insurance Co. v. Han- 
 ford, 143 U. S. 187, 190, 12 Sup. Ct. 437, 36 L. Ed. 118, the court 
 recognized the condition that in various states the law, based upon 
 the decisions of the local courts, was that an action could be main- 
 tained under such circumstances, and that it was not necessary to 
 resort to equity to enforce the right mentioned. It was applied to 
 the contention there in the following manner: Under the law of 
 Illinois, a mortgagee could sue the grantee directly at law. The 
 corollary to this proposition was that the grantee became the prin- 
 cipal debtor and the mortgagor from whom he had received the ti- 
 
 1 ' The statement of the case and the opinion of the court have been abbre- 
 liated. 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1077 
 
 tie was the surety, so that when the mortgagee extended the time 
 in which the grantee might pay the debt, it released the mortgagor, 
 who stood as a surety only. We draw from these decisions, cited 
 by the defendants here, this doctrine, that when the grantees of a 
 mortgagor agrees to pay the mortgage, a right at once arises in 
 favor of the mortgagee, and that it is enforceable according to the 
 remedy afforded by the lex fori. The effect of the law of the place 
 on the remedy is discussed in Gibson v. Victor Talking Machine Co. 
 (D. C.) 232 Fed. 225. 
 
 Oregon precedents are numerous to the effect that, on a contract 
 properly made for the benefit of a third person, he can bring an 
 action directly against the promisor. The early case of Baker v. 
 Eglin, 11 Or. 333, 8 Pac. 280, recognized the liability of the prom- 
 isor to the third person, so as to exonerate the former from being 
 held as a garnishee in the action of other creditors of the promisee. 
 The case does not make any ruling upon the remedy by which the 
 third person might enforce his interest in that contract, but in the 
 following cases the doctrine is recognized that an action at . law 
 would lie: Hughes v. O. R. & N. Co., 11 Or. 437, 5 Pac. 206; 
 Schneider v. White,' 12 Or. 503, 8 Pac. 652 ; Chrisman v. State In- 
 surance Co., 16 Or. 283, 18 Pac. 466; Washburn v. Interstate In- 
 vestment Co., 26 Or. 436, 36 Pac. 533, 38 Pac. 620; Feldman v. Mc- 
 Guire, 34 Or. 309, 55 Pac. 872; Miles v. Bowers, 49 Or. 429, 434, 
 90 Pac. 905 ; Hoffman v. Habighorst, supra ; Oregon Mill & Grain 
 Co. V. Kirkpatrick, 66 Or. 21, 133 Pac. 69; Baker City Mercantile 
 Co. V. Idaho Cement Pipe Co., 67 Or. 372, 136 Pac. 23. 
 
 It is said in 13 C. J. 705, § 815: "In most of the states the Eng- 
 lish doctrine that where a person makes a promise to another for the 
 benefit of a third person the latter cannot maintain an action on it 
 is not recognized / to the full extent, but it is held, subject to the 
 qualifications hereafter stated-, that the action may be maintained. 
 This is now the prevailing, doctrine in the United States" — citing a 
 wealth of authorities. 
 
 But it is not every agreement to discharge an obligation to a 
 third party that will support an action at law by the latter. The 
 principle is thus stated by Mr. Chief Justice Bean in Washburn v. 
 Interstate Investment Co., 26 Or. 436, 441, 38 Pac. 620, 621 : "The 
 prevailing doctrine in this country undoubtedly is that, where one 
 person, as a consideration or part consideration for an executed 
 contract, promises another, for a consideration moving from him, 
 to pay or discharge some legal obligation or debt due from such 
 other to a third person, the latter, although a stranger to the con- 
 sideration, and not an immediate- party to the contract, may main- 
 tain an action thereon, if it was made directly and primarily for his 
 benefit." 
 
 In Vrooman v. Turner, 69 N. Y. 280, 25 Am. Rep. 195, the fol- 
 lowing language was used, and approved in. Kansas City Sewer^ Pipe 
 
1078 THIED PAETT BBNBPICIAEIBS (Ch. 6 
 
 Co. v; Thompson, 120 Mo. 218, 25 S. W. 522: "To give a third 
 party who may derive a benefit from the performance of the prom- 
 ise an action, there must be : First, an intent by the promisee to 
 secure some benefit to the third party; and, second, some privity 
 between the two, the promisee and the party to be benefited, and 
 some obligation or duty owing from the former to the latter which 
 would give him a legal or equitable claim to the benefit of the prom- 
 ise, or an equivalent from him personally." 
 
 The present case comes within the doctrine thus announced, 
 which, we think, is well settled by the authorities. The stipulation 
 to pay the mortgage was for the benefit of the holder thereof, di- 
 rectly. There was a privity between the mortgagor, who is the 
 promisee, and the holder of the mortgage, resulting from that in- 
 strument. There was an obligation from the original mortgagor to 
 the mortgagee to pay; hence, when the mortgagor conveyed his 
 property to May, who assumed the mortgage, at once an obliga- 
 tion arose which, under our precedents, considering the lex fori, 
 could be enforced by an action at law. 
 
 The defendants cite Parker v. Jeflfery, 26 Or. 186, 37 Pac. 712, 
 Washburn v. Interstate Investment Co., supra, and Brower Lumber 
 Co. V. Miller, 28 Or. 565, 43 Pac. 659, 52 Am. St. Rep. 807. Parker 
 V. Jeffery was a case in which a contractor had given a bond to the 
 city of Portland to pay for all labor and materials used in the con- 
 struction of a sewer. This occurred before our present statute on 
 that subject was enacted. No ■ particular claim of any individual 
 was required to be paid. In Washburn v. Interstate Investmer^t Co. 
 the defendant had agreed to advance to a certain concern money to 
 pay the latter's debts, without specifying them, and not to exceed 
 a certain amount. Similar circumstances were present in Brower 
 Lumber Co. v. Miller. In each of these cases nothing passed to the 
 promisor from the promisee in which the third party had any in- 
 terest or to which he had any claim. This element, which other- 
 wise would furnish a common bond or quasi privity among the 
 three parties, was absent. This circumstance differentiates these 
 cases from the present contention and those like it. The mortgaged 
 property, passing from the mortgagor to his grantee, in which the 
 third party has an interest by virtue of his mortgage, 'puts the in- 
 stant case in the class recognized by the quoted language of this 
 court in the Washburn Case. 
 
 One reason given by the courts which refuse to enforce such an 
 obligation except in equity is that the immediate parties to the agree- 
 ment could annul the same, but that matter is controlled by this 
 doctrine, that such a contract cannot be rescinded by the parties there- 
 to after it has been acted upon or accepted by the third party. Da- 
 vis V. Calloway, 30 Ind. 112, 95 Am. Dec. 671; Dodge v. Moss, 82 
 Ky. 441; Pecquet v. Pecquet, 17 La. Ann. 204; Mitchell v. Cooley, 
 5 Rob. (La.) 240; Gifford v. Corrigan, 117 N. Y. 257, 22 N. E. 756, 
 
Ch. 6) THIED PARTY BENEFICIARIES 1079 
 
 6 L. R. A. 610, 15 Am. St. Rep. 508; Putney v. Farnham, 27 Wis. 
 187, 9 Am. Dec. 459. 
 
 Bringing an action by the mortgagee on the contract for his ben- 
 efit is an acceptance thereof by him. Taylor v. IngersoU, 18 Colo. 
 App. 272, 71 Pac. 398; McCoy v. McCoy, 32 Ind. App. 38, 69 N. E. 
 193, 102 Am. St. Rep. 223 ; Motley v. Manufacturers' Insurance Co., 
 29 Me. 337, 50 Am. Dec. 591 ; Warren v. Batchelder, 16 N. H. 580'; 
 Zwietusch v. Becker, 153 Wis. 213, 140 N. W. 1056; Gilbert Paper 
 Co. V. Whiting- Paper Co., 123 Wis. 472, 102 N. W. 20. If the re- 
 scission of the contract by Jacobs had been mooted here, it is fore- 
 closed by the institution of this action, which makes it impossible 
 now to abrogate it without the consent of the plaintiff. * * * 
 
 The second defense, to the effect that neither May nor the invest- 
 ment company ever entered into any contract or agreement with the 
 plaintiff to pay it any sum of money whatever, is sham, in the le- 
 gal sense, because, as the record discloses, the acceptance of the 
 deed drawn in the form stated amounts to a contract to pay the 
 mortgage to the holder thereof. Again, the offer pleaded in the 
 third separate answer to Convey to the plaintiff the property in sat- 
 isfaction of the deed cannot be sustained as a defense, because that 
 is not according to the terms of the contract. The agreement is 
 for payment, which means the delivery of money to the payee in 
 discharge of the debt. The plaintiff cannot be compelled to accept 
 the land in satisfaction of its claim, any more than it could be re- 
 quired to accept municipal bonds or a band of cattle. The demur- 
 rer to these three separate defenses was properly sustained. * * * 
 
 In assuming the payrhent of the mortgage the covenant therein 
 as distinguished from the separate personal note was the measure 
 of the grantee's duty. The obligation assumed by him ihust be con- 
 strued according to its terms, and is not to be enlarged beyond them. 
 The present grantees did not agree to respond directly to the con- 
 ditions of the note, but only to the mortgage, which latter instrument 
 does not directly bind them to pay more than the principal and in- 
 terest of the note ; hence the attorney's fee must be laid out of the 
 case, although the note itself is quoted in the complaint. * * * 
 
 On the authority of Hicks v. Hamilton, 144 Mo. 495, 46 S. W. 432, 
 66 Am. St. Rep. 431, the contention is made that the investment 
 company is a remote grantee, and as such is not liable here. In 
 that case the mortgagor conveyed his land merely "subject to the 
 mortgage," without requiring his grantee to assume or pay the in- 
 cumbrance. The latter in turn deeded the tract to another by an 
 indenture which required that grantee to "assume and pay the mort- 
 gage." Thus the continuity of personal Hability was interrupted so 
 that its chain did not unite the original mortgagee with the ultimate 
 grantee^ and for this reason it was held that the latter was not di- 
 rectly liable to the former. The case at bar is different because the 
 clause assuming and agreeing to pay the mortgage is common to 
 
1080 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 both successive conveyances, which constitutes an unbroken sequence 
 of personal liability from the original mortgagors down to the last 
 grantee. Of course there, can be but one satisfaction of the demand, 
 although both grantees are liable. 
 
 The result is that the judgment is modified by allowing the plaintiff 
 to recover from the defendants the sum of $3,000, without any at- 
 torney's fees.^* 
 
 FRY V. AUSMAN et al. 
 
 (Supreme Court of Soutli Dakota, 1912. 29 S. D. 30, 135 N. W. 708, 39 L. R. 
 A. [N. g.] 150, Ann. Cas. 1914C, 842.) 
 
 Action by Uriah S. Fry against L,. E. Ausman and others. From a 
 judgment for defendants, plaintiff appeals. Affirmed. 
 
 The deed to the grantor contained the following clause : . "The same 
 are free from all incumbrances, except a first mortgage of $5,000;" 
 but contained no statement that she assumed the mortgage. The deed 
 from the grantor to the grantee contained the following clause : "The 
 same are free from all incumbrances, except a first mortgage of $S,- 
 000 and interest from April 26, 1908, at 6 per cent, which second party 
 agrees to assume." The mortgage was foreclosed,, and, the proceeds 
 being insufficient to satisfy it, this action was brought to recover the 
 deficiency. 
 
 Whiting, J. The sole question presented by this appeal is whethef 
 one holding a note secured by a mortgage upon real estate can recover 
 upon such note against a party other than the mortgagor,, where, such 
 party had taken a deed to said mortgaged premises, and in such deed 
 had assumed such mortgage indebtedness, the grantor in such deed 
 being in no manner bound to pay such mortgage indebtedness, and 
 there being no evidence, other than such deed, to show an intent on the 
 part of the grantor and grantee in such deed to contract for the ben- 
 efit of the owner of the note and mortgage. The trial court held there 
 could be no recovery. 
 
 IS In accord: Gifford v. Corrigan, 117 N. Y. 257, 22 N. E. 756, 6 L. R. A. 
 610, 15 Am. St. Rep. 508 (1889) ; Thorp v. Keokuk Coal Co., 48 N. Y. 253, 257 
 (1872) ; Burr v. Beers, 24 N. Y. 178, 80 Am. Dec. 327 (1861) ; Gay v. Blancli- 
 ard, 32 La. Ann. 497 (1880) ; Pope v. Porter (G. C.) 33 Fed. 7 (1887) ; 
 Urquhart v. Brayton, 12 K. I. 169 (1878); CaiTer v. Eads, 65 Ala. 190 
 (1880) ; Allen v. Bucknam,, 75 Me. 352 (1883) ; Figart v. Halderman, 75 Ind. 
 567 (1881) ; Huyler'^ Ex'rs v. Atwood, 26 N. J. Eq. 504 (1875) ; George v. 
 Andrews, 60 Md^ 26, 45 Am. Rep. 706 (1882) ; Barnes v. Jones, 111 Miss. 337, 
 71 South. 573 (1916); Earrell v. Steward,, 134 Ark. 605, 204 S. W. 423 
 (1918) ; Cooper v. Foss, 15 Neb. 515, 19 NJ "W. 506 (1884). Contra in the 
 Virginias, where by statute only a sole beneficiary can sue. NeWberry Land 
 Co. V. Newberry. 95 Va. 119. 27 S. E. 899 (1897) : King v. Scott. 78 W. Va. 
 58, 84 S, E. 954 (1915). A later Code is reported to have changed this in 
 Virginia, 
 
 See, further, cases cited in 13 C. J. 707, S 816: In Michigan and Connecticut 
 a mortgagee beneficiary can sue by virtue of a special statute. Mich. Comp. 
 Laws, 1897, S 519 ; Corning v. Burton, 102 Mich. 86, 62 N. W. 1040 (1894) ; 
 Conn. Gen. St. 1918, §5610. i . 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1081 
 
 Respondent contends that, disregarding the other question involved 
 herein, appellant cannot recover because of a lack of privity of con- 
 tract between appellant and respondent. It is true that, under what is 
 known as the English rule and which is followed in several of the 
 states, appellant would not be the proper party plaintiff, and it would 
 be necessary that the action be brought in the name of the grantor in 
 the deed ; but there early arose in this country what is known as the 
 American rule allowing the real party in interest to sue in his own 
 name upon a contract made for his benefit. The so-called "Code" 
 states have many or all adopted, many by statutory enactment, the 
 American rule. This state adopted such rule by section 1193, Civil 
 Code, which reads : "A contract, made expressly for the benefit of a 
 third person, may be enforced by him at any time before the parties 
 thereto rescind it." i» * * * 
 
 Pomeroy at section 1207 of the third edition of his work on Equity 
 Jurisprudence notes that the courts, holding that there can be no lia- 
 bility upon the part of the grantee where there was none on the part 
 of the grantor, also hold that the liability, when any does exist, results 
 only from an application of the doctrine of subrogation, and that, un- 
 less there was a liability or obligation on the part of the grantor so 
 that, as between the grantor and grantee, the grantee became the prin- 
 cipal debtor and the grantor but a surety, there would be nothing upon 
 which the creditor could base a right of subrogation. Pomeroy also 
 notes that the courts holding the grantee liable where the grantor was 
 not liable base the right of recovery solely upon the contract, taking . 
 the position that, where a contract is made for the benefit of one not 
 a party thereto, he may treat the promise as though made to himself, 
 and may sue in his own name thereon. 
 
 The federal Supreme Court has adopted the subrogation theory of 
 liability as appears by the following from the case of Keller v. Ash- 
 ford, 133 U. S. 610, .10 Sup. Ct. 494, 33 L. Ed. 667: "The doctrine 
 of the right of a creditor to the benefit of all securities given by the 
 •principal to the surety for the payment of the debt does not rest upon 
 any liability of the principal to the creditor, or upon any peculiar re- 
 lation of the surety towards the creditor, but upon the ground that the 
 surety, being the creditor's debtor, and in fact occupying the relation 
 of surety to another person, has received from that person an obliga- 
 tion or security for the payment of the debt, which a court of equity 
 will therefore compel to be applied to that purpose at the suit of the 
 creditor. Where the person ultimately held liable is himself a debtor 
 to the creditor, the relief awarded has no reference to that fact, but 
 is grounded wholly on the right of the creditor to avail himself of the 
 right of the surety against the principal. If the person who is admit- 
 ted to be the creditor's debtor stands at the time of receiving the se- 
 curity in the relation of surety to the person from whom he receives it, 
 
 i» A review of several cases is here omitted. 
 
1082 THIRD PAETT BENEPICIAEIES (Ch. 6 
 
 • 
 
 it is quite immaterial whether that person is or ever has been a debtor 
 of the principal creditor, or whether the relation of suretyship or the 
 indemnity to the surety existed, or was known to the creditor, when 
 the debt was contracted. In short, if one person agrees with another 
 to be primarily liable for a debt due from that other to a third person, 
 so that as between the parties to the agreement the first is the princi- 
 pal and the second the surety, the creditor of such surety is entitled in 
 equity to be substituted in his place for the purpose of compelling 
 such principal to pay the debt." 
 
 For a general discussion of this question and a i-eview of the nu- 
 merous authorities bearing upon the different phases thereof, we refer 
 to the very exhaustive notes pages 176 to 207 of 71 Am. St. Rep. 
 These notes call particular attention to the two elements required un- 
 der the New York decisions in order that there may be a recovery: 
 (1) There must be an intent- to benefit the third party; and (2) the 
 promisee must owe some obligation to the third, party. It is very ap- 
 parent that the decisions from those states which have adopted the 
 English rule above referred to are of no authoritative value upon the. 
 question before us. Among these states seem to be Georgia, Massa- 
 chusetts, Michigan, New Hampshire, North Carolina, Vermont, Vir- 
 ginia, and Wyoming. We therefore cite cases from those states only 
 which recognize the American rule allowing suit by real party in in- 
 terest. 
 
 Among the authorities supporting the New York rule and denying a 
 right of recover)' imder the facts in this case are the follow- 
 
 irjnr 'SO Sjt ZfC ifl 
 
 Supporting the other rule we find: '^^ * * * 
 
 2" King v. Whitely, 10 Paige (N. T.) 465 (1843) ; Vrooman v. Turner, 69 
 N. Y. 280, 25 Am. Eep. 195 (1877) ; Wilbur v. Wai-ren, 104 N. Y. 192, 10 N. 
 E. 263 (1887) ; Dumherr v. Kau, 135 N. Y. 219, 32 N. B. 49 (1892) ; Jefferson 
 V. Asch, 53 Minn. 446, 55 N. W. 604, 25 L. R. A. 257, 39 Am. St. Eep. 618 
 (1893) ; Kramer v. Gardner, 104 Minn. 370, 116 N. W. 925, 22 L. R. A. (N. S.) 
 492 (1908) ; Clement v. Willett, 105 Minn. 267, 117 N. "W. 491, 17 L. R. A. 
 (N. S.) 1094, 127 Am. St. Rep. 562, 15 Ann. Cas. 1053 (1908) ; Morris v. Mis, 
 4 Kan. App. 654, 46 Pac. 58 (1896) ; New England Trust Co. v. Nash, 5 Kan. 
 App. 739, 46 Pac. 987 (1896) ; Young Men's Christian Ass'n of Portland v. 
 Croft, 34 Or. 106, 55 Pac. 439, 75 Am. St. Eep. 568 (1898) ; Bakin v. Shultz, 
 61 N. J. Eq. 156, 47 Atl. 274 (1900) ; Ward v. De Oca, 120 Cal. 102, 52 Pac. 
 130 (1898). 
 
 21 Dean v. Walker, 107 111. 540, 47 Am. Rep. 474 (1882) ; Harts v. Emery, 
 184 111. 560, 56 N. E. 865 (1900) ; Birke v. Abbott, 103 Ind. 1, 1 N. E. 485, 53 
 Am. Eep. 474 (1885) ; Marble Sav. Bank v. Mesarvey, 101 Iowa, 285, 70 N. 
 W. 199 (1897) ; McGregor v. Easter Bldg. & Loan Ass'n, 5 Neb. (TJnof.) 563, 
 99 N. W. 509 (1904) ; Hare v. Murphy, 45 Neb. 809, 64 N. W. 211, 29 L. R. A. 
 851 (1895) ; Merriman v. Moore, 90 Pa. 78 (1879) ; Brewer v. Maurer, 38 
 Ohio St. 543, 43 Am. Eep. 436 (1883) ; McKay v. Ward, 20 Utah, 149, 57 Pac. 
 1024, 46 L. E. A. 623 (1899) ; Enos v. Sanger, 96 Wis. 150, 70 N. W. 1069, 
 37 L. R. A. 864, 65 Am. St. Rep. 38 (1897) ; Tweeddale v. Tweeddale, 116 Wis. 
 517, 93 N. W. 440, 61 L. R. A. 509, 96 Am. St. Eep. 1003 (1903) ; Fanning v. 
 Murphy, 126 Wis. 538, 105 N. W. 1056, 4 L. R. A. (N. S.) 666, 110 Am. St. 
 Eep. 946, 5 Ann. Cas. 435 (1906). 
 
 Also in accord : McDonald v. Finseth, 32 N. D. 400, 155 N. W. 863, L. R. A. 
 1916D, 149 (1915) ; Casselman's Adm'x v. Gordon & Lightfoot, 118 Va. 553, 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1083 
 
 We would call particular attention to the Utah case owiiig to the 
 very exhaustive dissenting opinion found therein. There are many 
 other authorities which in principle support one or the other of the 
 two theories mentioned herein, but we have confined our citations to 
 those where the facts passed upon were the same as here, namely, 
 where the grantee in a deed had assumed a mortgage debt for which 
 his grantor was not liable. 
 
 While we think it must be conceded that, in case the second element 
 required under the New York decisions does exist, it may, from that 
 fact, be presumed that the first element is also present, and therefore 
 the party for whose benefit the contract is made be entitled, under the 
 subrogation theory, to recover of the party who has rendered himself 
 the principal debtor ; yet it seems equally clear to us that, whenever two 
 parties enter into an agreement that appears to have been made ex- 
 pressly for the benefit of a third party, and such agreement has a good 
 and sufficient consideration, the agreement itself creates all the privity 
 there need be between the person for whose benefit the agreement was 
 entered into and the party assuming the obligation, and an action at law 
 should lie regardless of whether there was any obligation existing 
 between tlie other party to the agreement and the third party. But, 
 before the third party can adopt the agreement entered into and re- 
 cover thereon, he must show clearly that it was entered into with the 
 intent on the part of the parties thereto that such third party should 
 be benefited thereby. This intent might, in a given case, sufficiently 
 appear from the contract itself, but it must frequently be shown by 
 other proof. While the cases sustaining a recovery have few, if any 
 of them, expressly recognized the necessity of the existence of the 
 first element (the intent to benefit the third party), yet an examination 
 of the decisions will reveal the fact that such element was clearly es- 
 tablished in nea.rly all such cases. 
 
 We concur heartily in the following words of Chief Justice Bartch 
 of Utah in his dissenting opinion in McKay v. Ward, 20 Utah, 149, 57 
 Pac. 1024, 46 L. R. A. 623 : "My conclusion is that the rule which 
 exempts a grantee, who has merely in a deed of conveyance assumed 
 and agreed to pay the mortgage in case his immediate grantor is not 
 personally liable for the payment of the mortgage debt, from liability 
 to the mortgagee, or owner of the mortgage, is not only founded in 
 reason and principle, but is sustained by an overwhelming weight of 
 authority. I do not intend to hold, however, that the grantee of mort- 
 gaged premises, whose grantor is under no personal obUgation to pay 
 the mortgage debt, cannot render himself liable to the mortgagee for a 
 deficiency judgment upon foreclosure and sale by accepting a deed 
 containing an assumption clause with knowledge of such contents, and 
 
 88 S B 58 (1916) ; Llewellyn v. Butlei:, 186 Mo. App. 525, 172 S. W. 413 
 (1915) ■ Allen v. Traylor (Tex. Com. App.) 212 S. W. 945 (1919) ; Title Guar- 
 anty & Trust Co. V. Bushnell (Tenn.) 228 S. W. 699 (1921). See review of 
 cases in 22 L. R. A. (N. S.) 492. 
 
1084 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 which clause contains apt words showing that the grantor intended to 
 bestow a benefit upon the mortgagee. The rule cannot be thus extend- 
 ed ; for doubtless a grantor may direct the payment of the purchase 
 price as he chooses, and may, if he so wishes, contract with a grantee 
 that the latter will pay a certain sum to a stranger, or a mortgagee, or 
 any person upon whom the grantor chooses to confer a benefit, and in 
 such cases the beneficiary may enforce the contract. Where, however, 
 as in the case at bar, the grantor is not personally liable, the assump- 
 tion clause ought to be construed as a mere indemnity to the grantor, 
 unless there is something to show a different intention by the contract- 
 ing parties. In this case there appears, to be nothing which indicates 
 any other intention, on the part of the grantor, than that of indemnity 
 to himself. There are no words in the deed, nor any evidence of facts 
 or circumstances, which indicate that the grantor had any interest in 
 protecting the mortgagee, to whom he was under no personal obliga- 
 tion. Doubtless, in general, the greatest interest a grantor has is in 
 effecting, a sale of the premises, and it cannot be assumed that he 
 would hazard the chances of such a sale by insisting on that which 
 would not benefit him. The circumstances of this case disclo.se no in- 
 tention to benefit the mortgagee, and therefore he is not entitled to a 
 deficiency judgment against the promisor; the assumption in the deed 
 being intended merely to indeirmify the promisee. If the intention of 
 the contracting parties had been otherwise, the respondent could easily 
 have shown it by placing the vendo;r, McDonald, upon the stand, and 
 interrogating him upon the subject. . This he failed to do, although,, 
 under the great weight of authority, the burden was upon him to show 
 that the contract was intended for his benefit, or that the vendor was 
 under some legal obligation to him respecting the debt. The respond- 
 ent not "having done this, why should the appellate court assume that 
 as a fact of which there is no proof?" 
 
 We think also that the very terms of our statute determine this 
 question in favor of respondent. Recovery can only be had in case 
 the contract was "made expressly for the benefit of a third person." 
 The state of California has identically the same statute, and in Chiing 
 Kee V. Davidson, 73 Cal. 522, 15 Pac. 100, the Supreme Court of that 
 state said: "It is not necessary that the parties for whose benefit the 
 contract has been made should be named in the contract. It must 
 appear, however, by the direct terms of the contract, that it was made 
 for. the benefit of such parties. It cannot be implied from the fact 
 that the contract would, if carried out between the parties to it, oper- 
 ate incidentally to their benefit." See, also, Biddel v. Brizzolara, 64- 
 Cal. 354, 30 Pac. 609. 
 
 From both reason and authority we conclude: That inasmuch as 
 the provision in the deed before us merely provided that the grantee 
 assumed the mortgage debt, and there being no other evidence of the 
 intent of the parties to such deed, we should construe such provision as 
 a mere agreement or contract to indemnify the grantor, and therefore 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1085 
 
 insufficient as the basis of an action founded upon the doctrine of sub- 
 rogation — there being no obligation on part of grantor to the third 
 person — and also insufficient, as the basis of an action under section 
 1193, Civil Code, it not appearing that the said agreement or contract 
 was entered into "expressly for the benefit of a (the) third person." 
 The judgment of the trial court is affirmed. 
 
 MEECH V. ENSIGN. 
 
 (Supreme Court of Errors of Connecticut, 1881. 49 Conn. 191, 44 Am. 
 
 Kep. 225.) 
 
 Civil action upon a promise of a grantee in a conveyance of an equity 
 of redemption to pay the mortgage debt ; brought to the Superior Court 
 in Middlesex County. The case was tried to the court and the fol- 
 lowing facts found: 
 
 On the 10th of November, 1873, John H. Poindexter of Hartford 
 made two promissory notes of that date, each for the sum of $1,378.12, 
 and payable to the order of Michael E. Griffin, executor, one two years 
 and the other four years after date, and to secure their payment mort- 
 gaged to Griffin as executor certain real estate situate in Middletown 
 in this state, the same being the first mortgage upon the real estate. On 
 the 12th of December, 1873, Griffin, as executor, endorsed the notes 
 and assigned the mortgage to the plaintiffs. 
 
 On the 2C)th of January, 1875, Poindexter, by his deed of that date, 
 
 conveyed the real estate to the defendant, subject to the mortgage, the 
 
 deed containing the following paragraph : 
 
 "And furthermore, I, the said grantor, do by these presents bind myself and 
 my heirs forever to warrant and defend the above granted and bargained 
 premises to him the said grantee, his heirs and assigns, against all claims and 
 demands whatsoever, except a mortgage to Michael E. Griffin, executor, as ap- 
 pears on record, amounting to the sum of .$2,756.25, and taxes assessed or 
 laid in October, 1874, with the interest thereon which has accrued from May, 
 1874; all of which the said Ensign assumes and agrees to pay as part of the 
 consideration of this deed." 
 
 Soon after this conveyance the plaintiffs, then the owners of the 
 notes, were informed of the same by Poindexter and told by him that 
 the defendant had assumed the payment of the notes ; and the de- 
 fendant, on the" 5th of February, 1875, called upon the plaintiffs and 
 paid the interest then due upon the notes, amounting to $96.47, and 
 told them that he was the person who was to pay the notes, and that 
 he should pay the interest promptly as it fell due, and should pay the 
 principal of the notes as they matured. 
 
 The defendant in fact paid the interest on the notes from the 5th 
 of February, 1875, up to the 10th of May, 1877. About the 19th of 
 November, 1875, soon after the first note matured, the plaintiffs ap- 
 plied to him to pay it. He said that he had not then the money to pay 
 it with, but would pay it as soon as he could. Being urged afterward 
 
1086 THIRD PAETT BENEFICIARIES (Ch. 6 
 
 from time to time to pay the principal of the overdue note, the defend- 
 ant, on the 15th of November, 1876, said to the plaintiffs that he could 
 not then pay it but that he would endorse both the notes and that they 
 could then raise the money upon them. The plaintiffs assented to this 
 proposal, and thereupon the defendant endorsed the notes, writing his 
 name on the back of each of them under that of Griffin. 
 
 When each of the notes became payable, Poindexter, the maker, was, 
 and ever since has been, without any property which could have been 
 levied upon for the security of the same, and insolvent. No demand 
 for the pa,yment of either of the notes has ever been made upon him. 
 
 The plaintiffs brought a petition to foreclose the mortgage to the 
 superior court for the county of Middlesex at its November terra, 1878, 
 upon which a decree was passed at that term limiting the defendant's 
 right to redeem to the first Monday of February, 1879, and he failing 
 to redeem the complete title to the mortgaged premises tKen vested in 
 the plaintiffs. 
 
 Upon the rendition of the decree the court appointed appraisers of 
 the property, pursuant to the statute, who on the 6th of February, 1879, 
 made their certificate appraising the property at $1,200, which is found 
 to have been its value at the expiration of the time limited by the de- 
 cree for redemption. 
 
 On the 5th of February, 1879, Poindexter executed an instrument in 
 writing, purporting to release the defendant from his undertaking to 
 pay the notes. 
 
 Upon these facts the case was reserved for the advice of this court. 
 
 CarpEnTBr, J.^^ The plaintiffs held a mortgage on real estate. The 
 defendant purchased the equity of redemption, agreeing with the mort- 
 gagor to pay the mortgage debt. Subsequently the mortgage was fore- 
 closed — the property then being worth less than the mortgage debt — 
 leaving a balance unpaid. This action is brought to recover the balance. 
 The promise was not assigned to the plaintiffs but was discharged by 
 the mortgagor before suit brought. The question of the defendant's 
 liability is reserved for the advice of this court. 
 
 The case differs from the other cases on this subject that have here- 
 tofore been before this court. We now have the naked question wheth- 
 er the owner of a debt secured by mortgage may maintain an action on 
 the promise made by the purchaser of the equity of redemption to the 
 mortgagor to pay the debt without an assignment of the right of ac- 
 tion which that promise gives. ^^ As a rule actions on contracts can be 
 brought only by him with whom the contract was made and from whom 
 the consideration moved. The legal title is deemed to be in him alone 
 and strangers to the contract cannot sue. The rule is a salutary one 
 
 22 Part of the opinion is omitted. 
 
 28 If the mortgagee, or other creditor beneficiary, obtains an assignment 
 from the mortgagor (the promisee) he can everywhere maintain suit oa the 
 contract. Hylaud v. Crofut, 87 Conn. 49, 86 Atl. 753 (1913) ; Foster v. At- 
 water, 42 Conn. 244 (1875) ; Reed v. Paul, 131 Mass. 129 (1881), 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1087 
 
 and should not be departed from except for good reasons. There are 
 however some exceptions to it. Actions of assumpsit may be main- 
 tained in some instances where there is no express contract with the 
 plaintiff and where the consideration does not move from him. If A 
 receives money from B to be paid to C, C may maintain an action 
 against A. These cases however are exceptions only in appearance. 
 They in fact recognize the general rule and are really within it ; for the 
 action is not brought on the express promise by A to B, but on an im- 
 plied promise by A to pay the money to C. 
 
 Another class of exceptions is where the contract has for its object 
 a benefit to a third party and is made with that intent. Some early 
 English cases in which promises were made to a father or uncle for the 
 benefit of a child or nephew are instances of this class. There may also 
 be cases in which a third party may have some peculiar equity in 
 the subject matter of a contract which will enable him to maintain a 
 bill in equity to enforce it. 
 
 Does this case fall within any exception recognized by authority 
 and supported by principle ? 
 
 Before alluding to decided cases let us examine the case with some 
 care in the light of the circumstances, for the purpose of discovering 
 just what the intention of the parties was and precisely what the 
 defendant promised to do; for courts always in enforcing contracts 
 intend to give effect to the intention of the parties; and when that 
 intention is discovered in respect to a legal and valid contract it is the 
 inflexible and imperative law of the case. And it is a necessary part 
 of the rule itself that the courts will not so construe and enforce 
 a contract as to bring about a result not expressed in the contract and 
 not intended by the parties. 
 
 What was the transaction? It was not a sale of a piece of land for 
 a fixed price, equal to the value of the land, so as to create a debt 
 for that sum ; but was simply a sale of the equity of redemption. The 
 distinction between the land, unincumbered, anii the equity of re- 
 demption, is obvious enough, and is an important one, as on it depend 
 in a great degree the rights and obhgations of the parties. The de- 
 fendant purchased the equity of redemption. The finding is that ' 
 the mortgagor "conveyed to the defendant said real estate subject 
 to said mortgage." So that the only debt brought into existence by 
 the transaction was the price agreed to be paid for the equity of re- 
 demption. The mere purchase raised no debt to the mortgagor which 
 the defendant was to discharge by paying the incumbrance. By the 
 contract of assumption he obliged himself to the mortgagor to pay the 
 mortgage debt. Whether that raised any personal obligation to the 
 mortgagee is the question in the case. If the probable intention of the 
 parties is to govern it is difficult to find any such liability in the trans- 
 action. The mortgagee was not a party to it, no part of the considera- 
 tion moved from him, and he was in no worse condition because of 
 it. He still had the security of the land and the personal responsibility 
 
1088 THIRD PARTY BENEFICIARIES (Ch. S 
 
 of the mortgagor, and that* is all he contracted for or required. The 
 parties contracted with reference to their own interest, not his; to 
 benefit themselves, not him. He had no legal or equitable interest in 
 the contract and there is no room for the presumjjtion that it was in- 
 tended for his benefit. 
 
 There was no agency express or implied. The mortgagor would 
 doubtless be surprised at the suggestion, should it be made, that he was 
 acting as the agent of the mortgagee. There was no substitution or 
 novation, for that requires three parties, and here were only two; 
 besides the original debtor was not discharged. 
 
 It was not the object of the parties to give the mortgagee additional 
 security; and to interpret it in that sense is to give it a force and 
 meaning never contemplated by the parlies, and is, in effect, making a 
 contract for them. The only contract which they made was simply 
 this — the defendant' agreed that he would pay the mortgagor's debt. 
 Ihe promisee alone had the legal and equitable interest. It follows 
 that he alone can enforce it unless he imparts that right to others. 
 That he may sue will not be disputed. If the mortgagee has that right 
 by force of the contract, then two persons wholly independent of each 
 other have an equal right. If either may sue both may, and a suit by 
 one will not abate or bar a suit by the other; and a discharge by one 
 for any cause short of a fulfillment will not discharge the contract. 
 Thus the promisor may be harassed with two suits at the same time 
 on the same contract, and if he would compromise with the promisee 
 he must obtain the consent of a stranger. If this is the law it is 
 an anomaly, for another instance of the kind is hardly to be found 
 in the whole range of jurisprudence. 
 
 We are aware that there are decisions from courts of the highest 
 authority, and whose opinions are entitled to the highest respect, which 
 hold that the creditor may sue on such contracts ; perhaps it is not 
 too much to say that the prevailing current of authority in this country 
 is in that direction ; but believing as we do that they are not founded 
 in good reason or sound policy we cannot accept them as law. The 
 question is an open one in this state, and principle, rather than prec- 
 edents not founded in principle, should determine it. 
 
 We cannot undertake to examine in detail the cases alluded to; 
 we can only refer in a general way to the reasoning by which they are 
 supported. It is interesting to note the various grounds on which they 
 stand, some of which are not only weak in themselves, but fail to 
 strengthen the others. It is an argument of no little weight against 
 the correctness of decisions that they seem to require disconnected 
 and inharmonious reasons to sustain them. 
 
 Some of the cases seem to proceed "upon the broad principle that if 
 one person makes a promise to another, for the benefit of a third per- 
 son, that third person may maintain an action on the promise ; " and 
 that without regard to the question whether the benefit to a third per- 
 son was the principal thing intenqed or was a mere incident. Lawrence- 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1089 
 
 V. Fox, 20 N; Y. 26S; Burr v. Beers, 24 N. Y. 178, 80 Am. Dec. 327; 
 Thorp V. Keokuk Coal Co., 48 N. Y. 253 ; Davis v. Calloway, 30 Ind. 
 112, 95 Am. Dec. 671. 
 
 In cases of this class the reasoning is not uniform. In some it is 
 suggested that from the express promise to the promisee the law 
 implies a promise to the third person. In others the principle of agency 
 is invoked and the mortgagor in making the contract is treated as the 
 agent of the mortgagee. The difficulty with this last position is that 
 it is contrary to the facts. 
 
 In Urquhart V. Brayton, 12 R. I. 169, Durfee, C. J., holds the de- 
 fendant liable to a third person on the ground of a novation, while 
 Potter, J., in the same case places the liability on the ground of money 
 had and received. There seem to be several difficulties in treating it 
 as a novation; first, it changes the nature of the contract; second, it 
 requires a third party, and here are but two; and third, an essential 
 element of a novation is wanting — the discharge of the original debtor. 
 
 In other cases the transaction is treated as a sale of the 'land ir- 
 respective of the mortgage and a retention by the purchaser of a por- 
 tion of the purchase money, to be paid to the mortgagee. HofFs Ap- 
 peal, 24 Pa. 200; Urquhart v. Brayton, 12 R. I. 169, supra; Blyer v. 
 MonhoUand, 2 Sandf. Ch. (N. Y.) 478. When the circumstances will 
 warrant that view of the facts there is no difficulty. In such cases the 
 debtor actually places or leaves the money in the hands of the prom- 
 isor to be paid to the creditor, and the action for money had and re- 
 ceived may be maintained — ^not on a promise to the debtor but on an 
 implied promise to the creditor. 
 
 Other cases, and this: class includes a large number, resort to the 
 doctrine of suretyship. Blyer v. MonhoUand, 2 Sandf. Ch. (N. Y.) 
 478, supra; Curtis v. Tyler, 9 Paige (N. Y.) 432; King v. Whitely, 10 
 Paige (N. Y.) 465; Bissell v. Bugbee,.7 Reporter, 550, Fed. Cas. No. 
 1445 ; Crowell v. Currier, 27 N. J. Eq. 152. We agree that that ground 
 would be tenable, in equity at least, if that was the real contract be- 
 tween the parties ; that is, if the parties really intended by the transac- 
 tion to furnish additional security to the creditor. If not, it seems to 
 us difficult to support the decisions upon that ground. In order to do 
 so the court must assume without reason and contrary to the fact that 
 such was the object and purpose of the contract. We have already en- 
 deavored to show that it was not. Let us examine the subject a little 
 further. There is no express contract of suretyship. Whatever ele- 
 rnent of suretyship there is results by operation of law from the posi- 
 tion in which the parties place themselves. The defendant agreed 
 with the debtor that he would pay the debt. As between themselves he 
 thereby became the principal debtor. The original debtor not being dis- 
 charged he was also liable to the creditor. If compelled to pay he v^as 
 a surety. only in this, that he had a right to call on the defendant to in- 
 demnify him. But all this did not affect the creditor and he is not a 
 
 COEBIN CONT 69 
 
1090 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 party to it. What interest has he in the transaction ? Ajid in what con- 
 sists his equity ? To make that relationship available to him it is nec- 
 essary not only to bring him into contract relations with the other par- 
 ties, but also to reverse the positions of the principal and surety and 
 make the purchaser 'the surety instead o£ the principal. Upon what 
 principle can that be done? By what process of reasoning can it be 
 vindicated? Again, there is no implication of suretyship as between 
 the creditor and the other parties, as no such implication is necessary 
 in order to give full effect to the intention of the parties. 
 
 We come, now, to a class of cases which constitute an important ex- 
 ception to the rule we are considering — ^that suits must be brought by 
 the party making the contract and from whom the consideration moved. 
 We refer to those cases in which the parties confessedly contracted 
 for the benefit of third persons, not incidentally but as the principal 
 object. Some of the cases cited by the plaintiffs are cases of this de- 
 scription and are not applicable to the case at bar. There may be cases 
 however in which this principle is invoked to sustain actions by the 
 mortgagee against the purchaser of the equity of redemption. 
 
 The principle itself is best illustrated by a brief reference to a few 
 of the leading cases. In Button v. Poole, 1 Ventris, 318, the defendant 
 promised the father to pay the daughter a sum of money as a marriage 
 portion. It was held that the daughter might sue on the promise. The 
 relation of the father to the daughter and his obligation Jo give her a 
 marriage portion seem to be adopted as a substitute for privity of con- 
 tract. Some of the decisions in the state of New York have taken a 
 similar view and treat the obligation of the mortgagor to the mortgagee 
 as a "substitute for privity" or "privity by substitution," to connect the 
 mortgagee with the contract. Vrooman v. Turner, 69 N. Y. 280, 25 
 Am. Rep. 195, and cases cited. Dutton v. Poole in modern times in 
 this country would be upheld on the ground that the promise was in- 
 tended for the benefit of the daughter as its object. 
 
 In Felton v. Dickinson, 10 Mass. 287, the defendant promised the 
 father of a minor son to pay the son a sum of money for his services. 
 After performing the service it was held that the son might maintain 
 an action ifl. his own name. In Farley v. Cleveland, 4 Cow. (N. Y.) 
 432, 15 Am. Dec. 387 (same case in error, 9 Cow. 639,) the defendant 
 bought hay of the debtor, in consideration of which he promised to pay 
 the debt due the plaintiff. The plaintiff maintained a suit in his own 
 name. In Hendrick v. Lindsay, 93 U. S. 143, 23 L. Ed. 855, the de- 
 fendant promised A that if he would sign a bail bond he would give 
 him a bond of indemnity. A and B signed the bail bond and it was 
 held that they could jointly maintain an action on the promise. In 
 these cases there is no difficulty in discovering an intention to benefit 
 the third person. 
 
 And yet this exception seems not now to be recognized in England. 
 Tweddle v. Atkinson, 1 Best & Smith, 393. Even in Massachusetts 
 
Gh. 6) THIRD PARTY BENEFICIARIES 1091 
 
 the tendency is to narrow the exception and adhere more rigidly to the 
 rule. Exchange Bank v. Rice, 107 Mass. 39, 9 Am. Rep. 1. It seems 
 to us that the exception to the rule is a reasonable one and should, pre- 
 vail. 
 
 The question then recurs — is the case at, bar within the exception? 
 We have already expressed our views as to the nature of the con- 
 tract and the real intent of the parties. If we are right it is clear that 
 the question must be answered in the negative. 
 
 That the incidental advantage to the creditor, (if it is an advantage to 
 have his debt paid by one man rather than another) is not such a benefit 
 as the exception contemplates, is apparent from a consideration of the 
 possiBle and even probable consequences of holding it to be so. The 
 case before us affords a good illustration. The debtor is insolvent, and 
 the property mortgaged has largely depreciated, so that it fails to pay 
 the debt. Now if the plaintiffs may recover the balance of the de- 
 fendant, they have a security for their debt which they did not original- 
 ly have, which they never contracted for, and which the contracting 
 parties did not intend that they should have. It in effect makes him the 
 absolute guarantor of the debt. * * * 
 
 We advise the Superior Court to render judgment for the defend- 
 ant.'* 
 
 JOHN HORSTMANN CO. v. WATERMAN. 
 (Supreme Court of Washington, 1918. 103 Wash. 18, 173 Pac. 733.) 
 
 Parkier, J.^^ The plaintiff, John Horstmann Company^ a corpora- 
 tion, seeks recovery from the defendant, S. K. Waterman, balances 
 due upon the purchase price of goods sold and delivered by it and 
 its assignor to the Lithocrete Company, a corporation; recovery 
 being sought upon the theory that the defendant has become liable 
 to the plaintiff for the payment of such balances under her guaranty 
 contract. Trial in the superior court for King county, without a 
 jury, resulted in findings and judgment awarding to the plaintiff re- 
 covery as prayed for, from which the defendant has appealed to 
 this court. 
 
 Prior to and on November 27, 1913, H. S. Waterman was the own- 
 er of all of the capital stock of the Lithocrete Company, except suf- 
 
 2* A review of certain New York eases is omitted. 
 
 Anticipating this decision, the Connecticut Legislature, in 1881, provided by 
 statute (Gen. St. 1918, § 5610) that the mortgagee may sue the grantee "m 
 his own name upon such promise, without obtaining an assignment thereof 
 from the grantor of said premises." In Colchester Savings Bank v. Brown, 
 75 Conn. 69, 52 Atl. 316 (1902), this statute was held to give the mortgagee a 
 right, not only against the immediate grantee of the mortgagor, but also 
 against any subsequent grantee, in case each grantee in the chain had assumed 
 the debt. ' 
 
 ^is Part of opinion is omitted. 
 
1092 THIRD PARTY BENEFICIARIES ' (Ch. 6 
 
 ficient shares thereof to enable others to hold office in the company. 
 On that day he sold all of his stock in the company to A. J. Weiffen- 
 bach, the then president of the company, at the same time entering 
 into a written contract with Weiffenbach and the company as follows : 
 
 "This contract, made this November 27, 1913, by and between H. 
 S. Waterman,' first party^ A. J. Weiffenbach, second party, and the 
 Lithocrete Company, a corporation of the state of Washington, third 
 party witnesseth: That whereas. Waterman has this day sold and 
 transferred to Weiffenbach all of the capital stock of the Ivithocrete 
 Company, for the sum of $3,500.00, retaining however certain as- 
 sets of the company below mentioned: Now, therefore, in consid- 
 eration of the premises and of the mutual promises hereinafter con- 
 tained, the parties hereto agree as follows : 
 
 "I. It is agreed by all the parties hereto that Waterman shall re- 
 tain as his own individual property the following property hereto- 
 fore owned by the company: All office furniture and office equips 
 ment, all the bills and accounts receivable, claims, and choses in ac- 
 tion of the company, and ten tons Of Styrian Magnesite; and the 
 company agrees to execute and deliver to Waterman, upon demand, 
 a proper written assignment of any or all of said bills and accounts 
 receivable, claims, and choses in action. 
 
 "II. Said Waterman agrees that he will within one year from the 
 date hereof pay or settle all of the bills and accounts payable of said 
 company and all obligations and debts of said company now out- 
 standing, except any commissions owing by the company on account 
 of unexecuted contracts for laying lithocrete which have' been en- 
 tered into by said company, which commission the company is to pay ; 
 and said Waterman agrees to indemnify said company against the 
 payment of any and all debts of the company contracted prior to 
 this date, with the exception above noted, and to reimburse the com- 
 pany for all costs, attorney's fees, and damages which it may incur 
 or suffer by reason of any claim or action taken against it based on 
 any existing debt or obligation of the company. * * * 
 
 "V. Said Waterman agrees not to engage directly or indirectly 
 in the business of manufacturing, selling, or laying any composi- 
 tion flooring or similar substance in the state of Washington for a 
 period of five (5) years from tlie date hereof. 
 "[Signed] H. S. Waterman. 
 "A. J. Weiffenbach. 
 "Lithocrete Company,- 
 
 "By A. J. Weiffenbach, Pres. 
 "Howard Waterman, Secy." 
 
 At the same time, to secure the performance of this contract by 
 H. S. Waterman, appellant entered into a written contract with 
 Weiffenbach and the company as follows : 
 
 "This contract, made this November 27, 1913, by and between the 
 Lithocrete Company, a corporation of the state of Washington, and 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1093r 
 
 A. J. Weiffenbach, first parties, and S. K. Waterman, second party, 
 witnesseth : That whereas, at the time of making this contract, A.. 
 J. WeiflEenbach is about to purchase from H. S. Waterman the cap- 
 ital stock of the Lithocrete company : Now, therefore, in considera- 
 tion, of the first parties hereto entering into a certain contract with 
 H. S. Waterman, a copy of which is hereto attached, the second par- 
 ty guarantees the performance by H. S. Waterman of all of the con- 
 ditions of said contract to be performed by him; and in particular 
 guarantees the payment or settlement by H. S. Waterman within 
 one year from this date of all the debts and obligations of said Lith- 
 ocrete Company now existing, except the commissions on unexecut- 
 ed contracts of said company. The second party further agrees to- 
 indemnify and save harmless the first parties hereto against all 
 claims based on existing debts or obligations of said company, and 
 against all damages, costs, and attorney's fees which first parties 
 may suffer or incur on account of such claims. 
 "[Signed]' A. J. Weiffenbach. 
 
 "S. K. Waterman. 
 
 "Lithocrete Company, 
 
 "By A. J. Weiffenbach, President. 
 "Howard Waterman, Secretary." 
 At the time of entering into these contracts the Lithocrete Com- 
 pany was indebted to respondent and its assignor for goods sold and 
 delivered by them to it some time prior thereto, for which indebted- 
 • ness the judgment here appealed from was rendered against appel- 
 lant. It is contended in behalf of appellant that her guaranty con- 
 tract was not made for the benefit of respondent, but for the sole 
 benefit of the Lithocrete Company and Weiffenbach, that no priv- 
 ity of contract was thereby created between her and respondent, 
 and that therefore respondent has no right of recovery against her. 
 There is thus presented the much-discussed question, concerning 
 which the authorities are seemingly quite out of harmony, as to the 
 right of a third person to recover upon a contract the performance 
 of which by the obligor will result in benefit to such third person. 
 It is conceded by counsel for appellant that the exceptions to the 
 general rule that only parties to a, contract can sue thereon would 
 enable respondent to recover against H. S. Waterman under his con- 
 tract with the Lithocrete Company and Weiffenbach, because of the 
 express promise of H. S. Waterman to pay the existing debts of 
 the company, and the taking over by him of a considerable portion 
 of the property of the company. We are to remember, however, 
 that appellant, S. K. Waterman, is one step further removed from 
 respondent than H. S. Waterman ; that she has only guaranteed to 
 the Lithocrete Company and Weiffenbach the performance by H. S. 
 Waterman of his promise to pay the indebtedness of the Lithocrete 
 Company; that she has not promised unconditionally to pay stich 
 debts, but her promise in effect goes no further than that she will 
 
1094 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 pay those debts if H. S. Waterman does not pay them; and that 
 she has not received, under her guaranty, contract, any property or 
 funds which respondent had a right to look to for the satisfaction 
 of its claims against the Lithocrete Company.^* * * * 
 
 Our own early decisions may not be wholly harmonious upon the 
 question of the right of a party to recover upon a contract to which 
 he is not a party; but the following later decisions, we think, call 
 for the conclusion, in harfnony with the decisions above quoted from, 
 that the guaranty contract of S. K. Waterman, entered into by her 
 with Weiffenbach and the L,ithocrete Company, was not intended for 
 the benefit of respondent or other creditors of that company, but 
 was for the exclusive benefit of Weiffenbach and the Lithocrete 
 Company, and that therefore respondent cannot recover thereon, 
 though it would be benefited by the performance of the obligations 
 of S. K. Waterman thereunder: Spokane, etc., v. Pac. Surety Co., 
 86 Wash. 489, 150 Pac. 1054; Rust v. United States Fidelity & G. 
 Co., 87 Wash. 93, 151 Pac. 248; Dupont De N. Powder Co. v. Nat. 
 Surety Co., 90 Wash. 227, 155 Pac. 1050. Among other decisions 
 supporting our conclusion we note Am. Exchange Nat. Bank v. N. 
 P.Ry. (C. C.) 76 Fed. 130; German State Bank v. N. W. Water 
 Sc Iv. Co., 104 Iowa, 717, 74 N. W. 685 ; Sweeney v. Houston, 243 
 Pa. 542, 90 Atl. 347, L. R. A. 1915A, 779; Montgomery v. Rief, 15 
 Utah, 495, 50 Pac. 623; Wilson v. Shea, 29 Cal. App. 788, 157 Pac. 
 543 27 f^\y^ j-^yQ jjg^ z\\.^A cascs show the disposition of the courts 
 
 2,6 The court here quoted from Second National Bank v. Grand Lodge, 98 
 TJ. S. 123, and Washburn v. Investment Co., 26 Or. 436, 36 Pac. 533, 38 PaC. 
 620. ' 
 
 2' Other cases In accord : Pennsylvania Steel Co. v. New York K. Co., 117 C. 
 C. A. 503, 198 Fed. 721 (1912) ; Durnherr v. Rau, 135 N. Y. 219, 32 N. E. 49 
 (1892) ; Wheat v. Rice, 97 N. Y. 296 (1884) ; Campbell v. Lacock, 40 Pa. 448 
 (1861) ; Adams v. Kuehn, 119 Pa. 76, 13 Atl. 184 (1888) ; Miller v. Winchell, 
 70 N. Y. 437 (1877) ; Case v. Case, 203 N. Y. 263, 96 N. E. 440, Ann. Cas. 1913B, 
 311 (1911) I liockvyood v. Smith, 81 Misc. Rep. 384, 143 N. Y. Supp. 480 (1913) ; 
 Thomas Mfg. Go. v. Prather, 65 Ark. 27, 44 S. W. 218 (1898) ; Buckley v. 
 Gray, 110 Cal. 339, 42 Pac. 900, 31 L, R. A. 862, 52 Am. St. Rep. 88 (1895) ; 
 Wilson V. Shea, 29 Cal. App. 788, 157 Pac. 543 (1916) ; HoUister y. Sweet, 
 32 S. D. 141, 142 N. W. 255 (1913) ; Kenfield Pub. Co. v. Baumgartner, 189 
 111. App. 413 (1914) ; Sweeney v. Houston, 243 Pa. 542, 90 Atl. 347, L. R. A. 
 1915A, 779 (1914). 
 
 Where a promisor agrees to pay money, or to do other service, directly to 
 a third party, the latter is sufficiently indicated as a beneficiary and can 
 maintain suit. Faust v. Faust, 144 N. C. 383, 57 S. E. 22 (1907) ; Beauchamp 
 V. Bertig, 90 Ark. 351, 119 S. W. 75, 23 L. B. A. (N. S.) 659 (1909) ; Miller 
 v. Fan, 178 Ind. 36, 98 N. E. 805 (1912) ; Waterhouse v. Waterhouse, 29 R. 
 I. 485, 72 Atl. 642, 22 L. R. A. (N. S.) 639 (1909) ; Union Machinery & Supply 
 Co. V. Darnell, 89 Wash. 226, 154 Pac. 183 (1916) ; Spear Min. Co. v. Shinn, 
 93 Ark. 346, 124 S. W. 1045 (1910) ; Concrete Steel Co. v. Illinois Surety Co., 
 163 Wis. 41, 157 N. W. 543 (1916) ; Silver King Coalition Mines of Nevada v. 
 Silver King Consol. Min. Co. of Utah, 122 C. C. A. 402, 204 Fed. 166, Ann. 
 Cas. 1918B, 571 (1913). 
 
 This is true, a fortiori, if the defendant received assets out of which the 
 debt was to be paid. Burson v. Bogart, 49 Colo. 410, 113 Pac. 516 (1911) ; 
 Forbes v. Thorpe, 209 Mass. 570, 95 N. E. 955- (1911), in equity; Barry v. 
 
Ch. 6) THIRD PARTY BENEFICI4RIES 1095 
 
 not to extend the doctrine here contended for by counsel for re- 
 spondent to new and doubtful cases, and also to resolve doubts as 
 to the intent of the parties executing a contract against third par- 
 ties claiming under it. * * * 
 
 The judgment is reversed, and the action dismissed. 
 
 FORBURGER STONE CO. v. LION BONDING & SURETY 
 
 CO. et al. 
 
 (Supreme Court of Nebraska, 1919. 103 Neb. 202, 170 N. W. 897). 
 
 Action by the Forburger Stone Company against the Lion Bonding 
 & Surety Company and others. Judgment for plaintiff, and the Surety 
 Company appeals. Affirmed. 
 
 Sedgwick, J. 1. A- building contractor entered into a contract to 
 construct a building, and gave a bond for the faithful performance of 
 the contract. This defendant was surety on the bond. The plaintiff 
 furnished material to the contractor which was used in the construc- 
 tion of the building, and he brought this action against the surety on 
 the bond to recover the value of the material. The bond required the 
 contractor to perform ail of the conditions of his contract, and one 
 of the conditions of his contract was that he should pay for all the 
 materials which he used in the building. Therefore this contractor's 
 bond contained an agreement for the benefit of this plaintiff, and il 
 has been frequently held by this court that, under such circumstances, 
 a party for whose benefit the contract was made can maintain an action 
 directly against the party who has contracted for his benefit. Doll v. 
 Crume, 41 Neb. 655, 59 N. W. 806, and cases cited. And various 
 other decisions of this court are to this effect. 
 
 2. This bond contained the following provision: "That the said 
 surety shall be notified in writing of any act on the part of said prin- 
 cipal, which shall involve a loss for which the said surety is respon- 
 sible hereunder, immediately after the occurrence of such act shall 
 have come to the knowledge of the duly authorized representative 
 or representatives of the obligee herein, who shall have the supervi- 
 sion of the completion of said contract." 
 
 It is conceded that no notice was given the surety as provided in the 
 bond, and the serious, and perhaps difficult, question in this case is 
 whether the third person, who is a beneficiary under this contract, can 
 recover without having given the notice specified. In Doll v. Crume, 
 
 Jordan, 116 Minn. 34, 133 N. W. 78 (1911) ; Bradley v. McDonald, 218 N. 
 T. 351, 113 N. E. 340 (1916) ; Collier v. De Brigard, 80 N. J. I^w, 94, 77 
 Atl. 513 (1910). , „^^^ ^ 
 
 In New Orleans St. Joseph's Ass'n v. Magnier, 16 La. Ann. 338 (1861), the 
 plaintiff was denied a reme'dy because performance of the defendant's primary 
 contractual duty would not bare benefited the plaintiff, although the plaintiff 
 was expressly named as beneficiary of a penalty clause. This decision should 
 not be followed. 
 
1096 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 supra, it was held: "That the contract between the city and Davis 
 [the contractor] and his sureties, and the promises and liabilities of 
 the latter thereon, were of a dual nature — a promise to the city that 
 Davis should perform the work in the time and manner he had agreed, 
 and a promise, in effect, to Crume to pay him for the labor' he should 
 perform for Davis." This proposition of law is discussed at length 
 in the opinion. 
 
 In Knight & Jillson Co. v. Castle, 172 Ind. 97, 87 N. E. 976, 27 L. 
 R. A. (N. S.) 573, it was held that under a similar contract the bene- 
 ficiary could not recover without having given the notice provided for 
 in the contract. The note in the L. R. A. is exhaustive, in which it is 
 said: "A contractor's surety bond to a public corporation is dual in 
 its nature, being for the benefit and protection of the obligee against 
 loss or damage from a failure of the contractor to perform his con- 
 tract, and also for the benefit of laborers and materialmen who do 
 work and furnish materials in the performance of the contract. And 
 when the rights of the latter are once fixed, no act of the corporation 
 will destroy or impair them" — and cites our case of Doll v. Crume, 
 supra, and other authorities upon this proposition. 
 
 In Doll V. Crume, supra, the contract was with a public corporation, 
 but the opinion does not consider that fact as material, as would be seen 
 from a reading of the 'opinion, in which it is said : "Suppose that 
 Davis [the contractor] had borrowed $100 for 90 days from a bank, 
 and given his note therefor, which note had been signed by the 
 plaintiffs in error as sureties. Now, if the bank, without the knowl- 
 edge of the plaintiffs in error, had extended the time of the payment 
 of this note, then such extension would have released the sureties from 
 liability thereon; but in the case supposed, if at the time Davis bor- 
 rowed the money plaintiffs in error had promised the bank that, in 
 consideration of its lending the money to Davis, they would pay a 
 debt of $10 which he owed to C, then any agreement between Davis 
 and the bank for an extension of the time of payment of the note would 
 not affect C." " 
 
 That is to say, the surety on the contractor's bond has agreed that 
 the contractor will pay the materialman. The contractor, of course, 
 was under obligation to pay the materialman, and the contract, being 
 for the benefit of the materialman, is distinct, accoi-ding to the author- 
 ity of this decision, from the contract that the contractor shall perform 
 his work as he agreed to do. There are two contracts — one that the 
 materialman shall be paid, and the other that the contractor shall per- 
 form his contract with the owner of the property. The entering into 
 the contract with the contractor by the owner is the consideration, for 
 the agreement to pay the materialman for the material. In the L. 
 R. A. note, above referred to, it is said that the decisions are not 
 unanimous, and "a majority incline to hold that such conduct [con- 
 duct of the nominal obligee] does not and cannot affect them [the 
 materialman] after their rights become fixed." The rights of laborers 
 
Ch. 6) THIRD PARTY BENEFICIARIES 
 
 1097 
 
 and materialmen to be paid for their labor and material are "fixed" 
 when they have faithfully performed the labor or furnished the mate- 
 rial; and, under tliese decisions, no failure of the contractor there- 
 after can invalidate the right so fixed. That the duty to give the speci- 
 fied notice is placed entirely upon the obligee named in the- contract, 
 and, relates only to his performance of the work he has contracted to 
 do, appears from the words of the contract. The surety is to be 
 notified "of any act on the part of said principal * * * immedi- 
 ately after the occurrence of such act shall have come to the knowledge 
 of" the representatives of the obligee "who shall have the supervision 
 of the completion of said contract." This plaintiff did not have lany 
 representative in this business, and neither the plaintiff nor any one 
 for him had supervision of the completion of the contract. The 
 plaintiff could not know when some act of the contractor came to the 
 knowledge of the owner of the building. It would be impossible for 
 the plaintiff to give the notice to the surety. Laborers and materialmen 
 are in the same position with respect to such contracts. If a laborer 
 who has performed a few days' work for the contractor would be 
 in danger of losing his wages unless he keeps himself posted as to 
 the doings of the contractor and the owner of the building, and sees 
 that they perform their respective duties, he would not be protected as 
 perhaps sound public policy would require. 
 
 As said in Des Moines Bridge & Iron Works v. Marxen & Rokahr, 
 87 Neb. 684, 128 N. W. 31 : "It is better that the law with respect to 
 contracts should be certain than that it should in all particulars con- 
 form to the views of the courts of some of our gipter states. The 
 defendants in the case at bar must have contracted with reference 
 to the law as announced in the cited cases, and the defendant bonding 
 company must have known that it was assuming an obligation to pay 
 the subcontractors and materialmen, as well as the laborers and me- 
 chanics engaged in constructing the courthouse referred to. The plain- 
 tiff, in contracting to furnish material for the courthouse, also had 
 a right to rely upon the law repeatedly stated by this court, arid should 
 not be deprived of the defendants' obligation to pay for that material 
 because a like bond could not be enforced in the state of New York. 
 We are not convinced that we should overrule a long line of our de- 
 cisions, and shall not do so in the instant case." 
 
 That was an action for material furnished a contractor for a public 
 building, and was before the statute making the contractor's bond 
 responsible for materials (Laws 1913, c. 170), and yet it is said that — 
 "the defendant bonding company must have known that it lyas assum- 
 ing an obligation to pay the subcontractors and materialmen, as 
 well as the laborers and mechanics engaged in constructing the court- 
 house referred to," 
 
 We think that, under our former decisions, the parties interested 
 must know that the surety on a contractor's bond in which it is agreed 
 that the contractor will pay laborers and materialmen, is directly li- 
 
1098 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 able for labor and material used by the contractor in the construction 
 of the building under his contract; and we think we ought to adhere 
 to that principle. 
 
 The judgment of the district court is affirmed."* 
 
 Aldrich, J., dissents. 
 
 Cornish, J. (dissenting). The fact that the beneficiary is a laborer 
 or materialman can, I take it, make no difference. If public policy, 
 or the status of laborers or materialmen, is to give them rights super- 
 ior to other beneficiaries under similar circumstances, the opinion 
 should make that clear and tell the reason why. What right can an 
 entire stranger to a contract have in it? The English and Massachu- 
 setts courts say none. The contractual relation requires a meeting 
 of minds and a consideration. Hence only the parties or privies to a 
 contract can enforce it, say they. 
 
 When the contract's promise is to save tiie promisee from a possible 
 loss, it may easily happen that its enforcement will be directly bene- 
 ficial to a third person, because the promisee's loss, provided against, 
 may be the promisee's liability to the third person. Many courts, in- 
 cluding this, have, in such case, enforced the contract at the suit of 
 the third party (beneficiary), the same as if he were a promisee or 
 obligee named in the contract. They have likened the case to novation. 
 Really, the right comes to the stranger to the contract by a sort of un- 
 expected grace. The liability of the obligor to him can hardly be 
 said to be contractual. The courts see in the situation and relation 
 of the parties a duty which the promisor ought not to refuse to perform, 
 and they permit to be done by direct means the thing that would or- 
 dinarily come about anyhow by indirect means. 
 
 Just as the stream can never rise higher than its source, nor the less 
 
 28 In the following cases laborers or materialmen were given judgment on 
 a surety bond given to the employer or owner ; the plaintiffs being held to be 
 intended as beneficiaries: Hay v. Hassett, 174 Iowa, 601, 156 N. W. 734 
 (1916), bond given to a municipality; Knight & Jillson Co. v. Castle, 172 
 Ind. 97, 87 N. E. 976, 27 L. R. A. (N. S.) 573, and note (1908) ; Concrete 
 Steel Co. V. Illinois Surety Co., 163 Wis. 41, 157 N. W. 543 (1916) ; School 
 Dist. of Kansas City ex rel. Koken Iron Works v. Livers, 147 Mo. 580, 49 S. 
 W. 507 (1899) ; Royal Indemnity Co. v. Northern Ohio Granite & Stone Co., 
 100 Ohio St. 373, 126 N. E. 405 (1919) : State ex rel. Marble Cliff Quarries uo. 
 V. Watts, 100 Ohio St. 380, /126 N. E. 407 (1919) ; Ochs v. M. J. Gamahan Co., 
 42 Ind. App. 157, 76 N. E. 788, 80 N. E. 163 (1907), Contra: Standard Gas 
 Power Corp. v. New England Casualty Co., 90 N. J. Law, 570, 101 Atl. 281 
 (1917) ; Lancaster v. Frescoln, 203 Pa. 640, 53 Atl. 508 (1902) ; Parker v. 
 Jeffery, 26 Or. 186, 87 Pac. 712 (1894). See, further, 27 Tale Law Journal, 
 274, 28 Tale Law Journal, 798; 29 Tale Law Journal, 914; 49 L. R. A. (N. S.) 
 1166, note. ■ 
 
 It is sometimes provided by statute that a builder's bond shall be given for 
 the benefit of laborers and materialmen. Federal statutes: 30 Stat. 906, c. 
 218; 33 Stat. 811, c. 778 (Comp. St. § 6923) ; Illinois Surety Co. v. John 
 Davis Co., 244 II. S. 376, 37 Sup. Ct. 614, 61 L. Ed. 1206 (1916) ; CaUf ornia : 
 Code Civ. Proc. § 1203; Carpenter v. Furrey, 128 Cal. 665, 61 Pac. 369 (1900K 
 Indiana: Rev. St. 1881, §§ 4246, 4247. West Duluth Village v. Norton, 57 
 Minn. 72, 58 N. W. 829 (1894) ; Ingold v. Hickory, 178 N. O. 614, 101 S. E. 
 525 (1919). 
 
Ch. 6) THIED PARTY BENEFICIARIES 1099 
 
 include the greater, nor the accidental be more regarded than the in- 
 tentional, nor one reap where he has not sown, so the promisor is never 
 bound to more than his promise, and the stranger to the contract 
 can have no better nor higher rights in the contract than the parties to 
 it. He gets any possible right he may have through the promise made 
 to the .obligee, and that is the promise that must be left as made and 
 only as made. 
 
 Such has been the holdings of these courts. In this opinion we are 
 announcing the law to be : That an entire stranger to a contract, who 
 (probably) did not know of it when made, for whose fortunes iieither 
 of the parties cared except as his own interest might be affected, who, 
 never did a thing in reliance on the contract (save commencing this 
 action), who paid no consideration for a promise, to whom none was 
 made and who made none himself, may, notwithstanding these facts 
 (undisputed), not only recover on the contract, but recover regardless 
 of its conditions. 
 
 Is there any precedent for this ? None. In Getchell & Martin Lum- 
 ber & Mfg. Co. V. Peterson & Sampson, 124 Iowa, 599, 100 N. W. 
 550, cited, the promise was made in words to the third party as well 
 as to the principal obligee, and the opinion states that material was 
 furnished in reliance upon the promise. In statutory bond cases the 
 law makes the laborer and materialman, in terms, a party to the con- 
 tract in his own, separate, and independent right. 
 
 Municipal bond cases are distinguishable in this: The officials act 
 in a representative capacity ; the laborer or materialman has no lien for 
 his protection. He should be protected by the municipality, who gets- 
 the benefit of his work. It does no extreme violence to the contract 
 to say that the parties must have intended his protection as the main, 
 purpose of the bond, that the city was acting as his agent, and that a 
 promise was made to him, just as subsequently enacted statutes pro- 
 vide. 21 R. C. h. p. 1016, § 64. 
 
 In the instant case, no contention can be made but that the contract 
 is a private contract; the parties at the time owing no duty to any 
 third person. Under the rule announced, if A., having faith in the 
 character and ability of young Mr. B., who is seeking employment 
 under C, promises C. that, if he employs B., B. will make the payments 
 of funds coming into his hands from time to time to the persons to 
 whom the funds should go, on the perfectly reasonable condition, 
 however, that when. C. learns of a default of B. he will inform A., 
 and, if afterwards C. neglects to give A. the information of B.'s de- 
 fault, which he knows, so that A. is released from his promise to C, 
 still A. is liable to the persons to whom the payments should have been 
 made by B. When one of such persons sues as beneficiary, and A. 
 sets up the promise that he should be notified of defaults, and shows 
 that, with notice, he could have saved half, or all, of the loss, we are 
 holding that the third person (beneficiary) makes a good reply as fol- 
 lows : "How could you expect me to give you notice ? I never knew of 
 
1100 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 your contract with B. until immediately before- commencing this ac- 
 tion." 
 
 It seems to me that the reasoning is unsound and the conclusion 
 unjust. No court will adhere to the rule in its general application. 
 The entertaining of doubts about a proposition, plain and simple in 
 itself, always invites confusion. We should pray to be delivered 
 from temptation to do so. Hard cases make bad law. When the 
 meaning of a valid contract is plain, that is the law of the contract. 
 When courts go contrary to its intent, they legislate. Once we agree 
 that the promise defendant made to the obligee was that the contractor 
 would make the payments, and that promise was on condition that 
 defendant should be notified by the obligee of defaults, there is no 
 need for discussion. 
 
 But is there room for good-faith dispute that such was the promise 
 made in terms only to the obligee and that notice was not given ? One 
 might, with sorne show of equity, argue (as has been held in certain 
 insurance cases) that the condition pr'ecedent ought not to defeat plain- 
 tiff's recovery unless the obligee's breach damaged defendant. This 
 contention, however, is not made. The defendant can complain: 
 "I am held, contrary to the only promise I made which was to the 
 obligee, to save him harmless upon condition." 
 
 The argument by analogy quoted in the opinion from Doll v. Crume, 
 41 Neb. 655, 59 N. W. 806, can^have no possible application here. 
 Here the promise, that "$10 which he owed to C." would be paid, is 
 unquestionably coupled with a condition, and is not absolute, as in the 
 supposed case. Besides, in the analogy quoted, the argument assumes 
 A.'s promise to C, made to the municipality as his agent or representa- 
 tive. In the case in hand, it cannot be said that more than one con- 
 tract, more than one promise (which is what the opinion probably 
 means), or more than two parties to the contract, were contemplated. 
 
 The right of the citizen to freely contract, and to be held only in 
 accordance with his promise as made, is one of the foundations and 
 safeguards of civil liberty.^" 
 
 FOSMIRE V. NATIONAL SURETY CO. 
 
 (Court of Appeals of New York, 1920. 229 N. Y. 44, 127 N. E. 472.) 
 
 Cardgzo, J.^" In June, 1916, Wagner & Braun entered into a Con- 
 tract with the state of New York for the construction of part of the 
 state highway in the village of Saugerties. The Highway L,aw (Con- 
 sol. Laws, c. 25, § 130, subd. 7) requires every such contractor to exe- 
 cute a bond in the form prescribed by the commission with sufficient 
 sureties, conditioned for the performance of the work in accordance 
 
 '2" A second dissenting opinion by Dean, J., is omitted. 
 '» Part of opinion is omitted. 
 
Ch. 6) THIRD PARTY BBNEPICIAEIES • 1101 
 
 with the contract, for the commencement and completion thereof within 
 the prescribed time, and for the payment of any direct or indirect dam- 
 ages that shall be suffered or claimed on account of such construction 
 during the time thereof and until the highway is accepted. In obedience 
 to tlaat statute, Wagner & Braun, as principals, and the defendant, Na- 
 tional Surety Company, as surety, made their bond in favor of the 
 people of the state of New York, in the sum of $25,245, with a condi- 
 tion which reads as follows : 
 
 "Now, therefore, the condition of this obligation is such that if the 
 said principal shall well, truly and faithfully perform the work in ac- 
 cordance with the terms of the contract and with the plans and specifi- 
 cations, and will commence and complete the work within the time 
 prescribed in the contract on his part to be kept and performed ac- 
 cording to the terms and tenor of said contract and shall protect the 
 said state of New York against and pay any excess of cost as provided 
 in said contract and all amounts, damages, costs, and judgments which 
 may be recovered against said state or its officers or agents or which 
 the said state of New York may be called upon to pay to any person 
 or corporation by reason of any damages, direct or indirect, arising 
 or growing out of the doing of said work, or suffered or claimed on ac- 
 count of said construction or improvement during the time thereof and 
 until the final completion and acceptance of the work, or the manner of 
 doing the same, or the neglect of the said principal, or his agents or 
 servants, or the improper performance of the said work by the said 
 principal, or his agents, or servants, or from any other cause, and if 
 the above bounden principal, his heirs, executors, administrators, or 
 assigns shall and do well and truly pay or cause to be paid in full the 
 wages stipulated and agreed to be paid to each and every laborer em- 
 ployed by the said principal or by his agents, then this obligation shall 
 be null and void, otherwise to remain in full force and virtue." 
 
 The plaintiff, a laborer employed upon the work, brings this action 
 against the surety to recover unpaid wages due from the contractors 
 to himself and a fellow laborer whose assignment he holds. The ques- 
 tiop is whether the bond gives a cause of action in his favor. 
 
 We think the cause of action is in favor of the people solely. Eastern 
 Steel Co. v. Globe Indemnity Co., 227 N. Y. 586, 125 N. E. 917; 
 Buffalo Cement Co. v. McNaughton, 90 Hun, ,74, 35 N. Y. Supp. 453, 
 affirmed on opinion below 156 N. Y. 702, 51 N. E. 1089. In so hold- 
 ing, we put our decision upon the single ground that the bopd, read m 
 its entirety, ,is inconsistent with an intention that the plaintiff and 
 others in like position should have the right to sue upon it. If -that 
 intention is absent, the right to sue will be denied. SimsOn v. Brown, 
 68 N. Y. 355. A different question would be here if the bond had been 
 conditioned for the payment of wages and i^fithing else. The interest 
 of the state in the welfare of those who labor on its public works might 
 then point to an intention to create a cause of action in their favor. 
 
1102 ■ THIRD PARTY BBNEFICIAEIES ' (Ch. 6 
 
 Matter of Int. Ry. Co. v. Rann, 224 N. Y. 83, 120 N. E. 153 ; Willis- 
 ton on Contracts, §§ 372, 402. Cf. 28 U. S. Stat. 278; 33 U. S. Stat. 
 811 (U. S. Comp. St. § 6923) ; Texas P. Cement Co. v. McCord, 233 U. 
 S. 157, 34 Sup. Ct. 550, 58 L,. Ed. 893. For the purpose of this opin- 
 ion, we assume, without attempting to decide, that when such an in- 
 tention is revealed, there is no legal obstacle in the way of its enforce- 
 ment. Seaver v. Ransom, 224 N. Y. 233, 120 N. E. 639, 2 A. L. R. 
 11.87 ;_ Lawrence v. Fox, 20 N. Y. 268; Williston, supra. But the diffi- 
 culty which the plaintiff meets at the threshold of his case is in making 
 out the) intention that such a right should be conferred. Simson v. 
 Brown, supra; Garnsey v. Rogers, 47 N. Y. 233, 7 Am. Rep. 440; 
 Knickerbocker L. Ins. Co. v. Nelson, 78 N. Y. 137, 153; Pardee v. 
 Treat, 82 N. Y. 385 ; Wheat v. Rice, 97 N. Y. 296; Standard Gas Power 
 Corp. V. New England Casualty Co., 90 N. J. Law, 570, 101 Atl. 281. 
 The dominant purpose of this bond was protection to the state. -That 
 is plain alike from its terms and from those of the statute which re- 
 quired that security be given (Highway. Law, supra). This dominant 
 purpose will be defeated if laborers may ignore the people, and sue in 
 their own right. They may then sue for wages as often as there is 
 default, and, exhausting the penalty of the bond, leave nothing for the 
 state. That danger was pointed out in Buffalo Cement Co. v. Mc- 
 Naiighton, supra, where a like bond was given to a city by the contrac- 
 tors for a sewer : "Such actions might have be^n brought before the 
 coiripletion of the sewer, and the penalty named in the bond exhausted, 
 and the city thereby deprived of the protection which the bond was 
 intended to give to it." Buffalo Cement Co. v. McNaughton, supra, 
 90 Hun at page 79, 35 N. Y. Supp. at page 456. Cf . Lancaster v. Fres- 
 coln, 203 Pa. 640, 644, 53 Atl. 508. 
 
 The state did not intend to make the employes of its contractors the 
 beneficiaries of a cause of action to be enforced in hostility to its own. 
 There is nothing far-fetched or visionary in the danger that would fol- 
 low the recognition of such competing claims of right. In this very 
 case, we have the admission of counsel that the state completed the 
 work on the default of the contractors, and did so at increased cost and 
 heavy loss, for which the bond was the security. The outcome, illus- 
 trates the possibilities of a divided right of action. 
 
 The plaintiff fails, therefore, to establish that he and his fellow la- 
 borers were the donees of a right to sue. Anson on Contracts (Huff- 
 cut's Ed.) p. 282; Id. (Corbin's Ed.) p. 338. The concession of such 
 a right would do more than frustrate the purpose of the bond. It 
 would frustrate the purpose of the statute which directed that a bond 
 be given. The statute does not permit, and the commission in exact- 
 ing the bond did not intend, that the security should be exhausted at the 
 instance and for the t)fnefit of persons other than the state itself. 
 What the defendant's liability would be if the action were prosecuted 
 by the people we need not now determine. That question is not here. 
 
Ch. 6) THIRD PARTY BBNEPICIARIBS 1103 
 
 This case is decided when we hold, as we now do, that the action will 
 not lie at the suit of the plaintiff now before us. * * * 
 Reversed. 
 
 BASSETT et al. v. HUGHES. 
 (Supreme Court of Wisconsin, 1877. 43 Wis. 319.) 
 
 Appeal from the Circuit Court for Dodge County. 
 
 Action for the balance of an indebtedness due originally from Hugh 
 W. Hughes (defendant's father) to the plaintiffs. 
 
 In April, 1870, Hugh W. Hughes conveyed to the defendant certaiii 
 real estate and all of his personal property, in consideration whereof 
 defendant covenanted, among other things, to pay all debts of the 
 former. This covenant is contained in a bond executed by defendant to 
 said Hugh W. Hughes. When the bond was executed the covenantee 
 owed plaintiffs the demand in suit, for which they held his note. The 
 defendant knew of the existence of this note when he covenanted to pay 
 his father's debts, and afterwards made a payment of $300 upon it, 
 leaving unpaid the balance claimed in this action. These facts appear 
 from the pleadings and proofs and the findings of fact by the court. 
 
 On the trial, defendant offered testimony in various forms for the 
 purpose of showing that his covenant to pay his father's debts was 
 rescinded in 1873, by an agreement to that effect between him and his 
 father ; but the court refused to admit the testimony. 
 
 The cause was tried by ^he court without a jury, and resulted in a 
 judgment for the plaintiffs for the unpaid balance due them on the note 
 of Hugh W. Hughes. Defendant appealed from the judgment. 
 
 Lyon, J.^^ 1. It, is settled in this state, that when one person, for a 
 valuable consideration, engages with another to do some act for the 
 benefit of a third person, the latter may maintain an action against the 
 former for a breach of such engagement. This rule applies, as well to 
 covenants under seal, as to simple contracts. McDowell v. Leav, 35 
 Wis. 171, and cases cited. In the present case, the defendant, for a 
 valuable consideration, engaged with his father to pay the debt which 
 the latter owed the plaintiffs, and, within the above rule, the plaintiffs 
 may maintain this action to recover the unpaid balance of such debt.^^ 
 
 SI Part of the opinion is omitted. 
 
 3 2 In accord: Huglies v. Oregon R. & Nav. Co., 11 Or. 437, 5 Pac. 206 
 (1884) ; Coster v. Albany, 48 N. Y. 399 (1871) ; Pond v. New Eochelle Water 
 Co., 183 N. y. 330, 76 N. E. 211, 1 L. R. A. (N. S.) 958, 5 Ann. Cas. 504 (1906) ; 
 King v. Scott, 76 W. Va. 58, 84 S. E. 954 (1915), Code 1913, c. 71 (sec. 
 3740) • Newberry Land Co. v. Newberry, 95 Va. 119, 27 S. E. 899 (1897), 
 Code 1904, § 2415. See, further, 13 C. J. 711, § 818. 
 
 Contra: Harms v. McCormick, 132 111. 104, 22 N. E. 511 (1889) ; Hendrick 
 V, Lindsey, 93 U. S. 143, 23 L. Ed. 855 (1876) : Willard v. Wood, 135 U. S. 
 309, 10 Sup. Ot. 831, 34 h. Ed. 210 (1890) ; Crowell v. Hospital of St. Barna- 
 bas, 27 N. J. Eq. 650 (1876). This distinction as to contracts under seal is 
 moribund. 
 
1104 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 2. It is quite immaterial, if the defendant's covenant to pay his fa- 
 ther's debts was afterwards rescinded by mutual agreement between 
 the parties to it. Before that was done, the plaintiffs had been infonijed 
 of the covenant, and made no objection thereto; indeed, the fair infer- 
 ence from the testimony is, that the plaintiffs fully assented thereto. 
 Whether it was or was not competent for the parties to the covenant 
 to rescind it before such notice to and assent by the plaintiffs, we need 
 not here determine. Certainly after such notice and assent, the cove- 
 nant could not be rescinded to the prejudice of the plaintiffs, without 
 their consent. 
 
 To support the position that it was competent for the defendant and 
 his father to rescind the contract, and thus defeat the plaintiffs' rigfht 
 of action against the defendant, the learned counsel for the defendant 
 cites two New York cases : Kelly v. Roberts, 40 N. Y. 432, and Kelly 
 V. Babcock, 49 id. 318. These cases do not Sustain the position. In the 
 first, it was held that an agreement, upon no new consideration, be- 
 tween debtor and creditor, that the debtor shall pay the amount of his 
 debt to a third person, to whom the creditor is indebted, is not, in the 
 absence of any notice or acceptance of or assent to' the arrangement by 
 such third person, irrevocable by the creditor. In the latter case, it 
 was held that "an agreement in a bill of sale or instrument of transfer 
 of personal property, that a portion of the purchase money of the goods 
 sold may be paid to and among the creditors of the vendor, without 
 a consent or agreement on the part of the vendee thus to pay, creates 
 no trust ; the balance unpaid is a debt due the vendor, and can be reach- 
 ed by and held under an attachment against his property." In this case, 
 the defendant covenanted to pay his father's debts; there was a new 
 and valid consideration for such covenant ; and the plaintiffs were no; 
 tified that it had been made, and gave their assent thereto. Thus we 
 find here all the conditions essential to the plaintiffs' right of action, 
 which were wanting in those cases. We conclude that the testimony 
 offered to" show a rescission of the covenant was properly reject- 
 
 Judgment affirmed. 
 
 '3 A discharge by the promisee is not effective as against the beneficiary, if 
 made after knowledge of and reliance upon the contract by the latter ; he is 
 not required to give notice of his assent. Gifford v. Corrigan, 117 N. T. 257, 22 
 N. E. 756, 6 L. R. A. 610, 15 Am. St. Rep. 508 (1889) ; New York Life Ins. 
 Co. V. Aitken, 125 N. Y. 660, 26 N. E. 732 (1891) ; Hill v. Hoeldtke, 104 Tex. 
 594, 142 S. W. 871, 40 L. R. A. (N. S.) 672, with note (1912) ; Zwietusch v. 
 Becker, 153 Wis. 21.S, 140 N. W. 1056 (1913). 
 
 "The person who has made the stipulation cannot revoke it if the third 
 party has declared that he wished to take advantage of it." French Civil 
 Code, 8 1121. See, also, Civ. Code Cal. § 1559 ; Civ. Code S. D. § 1193 ; Rev. 
 Laws Okl. 1910, § 895. 
 
 Before any knowledge and reliance by the beneficiary, the promisee may 
 have the power to discharge the promisor. See International Trust Co. v. 
 Keefe Mfg. & Inv. Co., 40 Colo. 440, 91 Pac. 915 (1907) ; Trimble v. Strother, 
 25 Ohio St. 378 (1874) ; Berkshire Life Ins. Co. v. Hutchings, 100 Ind. 496 
 (1884) ; Commercial Nat. Bank v. Kirkwood, 172 111. 563, 50 N. e! 219 
 
Ch. 6) THIKD PARTY BENEFICIARIES 1105 
 
 SEDGWICK V. BLANCHARD et al. 
 (Supreme Court of Wisconsin, 1919. 170 Wis. 121, 174 N. W. 459.) 
 
 Action by Edith Sedgwick against Ernest B. Blanchard and an- 
 other. From judgment for plaintiff, defendants appeal. Judgment 
 reversed, and cause remanded, with directions to enter judgment 
 dismissing the complaint; 
 
 On the 31st day of December, 1903, H. C. Blanchard, an aged 
 widower, was the owner of a farm, consisting of 160 acres, in Dunn 
 county. Wis. On that day he entered into a contract with his son, 
 E. B. Blanchard, whereby the son agreed to at once take possession 
 of said premises and personal property, till the farm, and provide 
 ' the said H. C. Blanchard with support and maintenance. The fa- 
 ther agreed "to give to said first party by deed or otherwise, to take 
 effect at the death of said second party," the east 80 acres of said 
 farm, and to Edith Sedgwick (plaintiff herein and daughter of H. C. 
 Blarichard) the west half of ^aid farm. It was further agreed in 
 said contract that any' failure on the part of the son to keep and per- 
 form any of the conditions thereof on his part to be performed 
 should render said contract null and void, and that thereupon, on 
 demand, said son should at once deliver to said father possession of 
 said premises as well as the personal property. The said H. C. Blan- 
 chard died March 23, 1915. This action was cominenced by Edith 
 Sedgwick, daughter of H. C. Blanchard, to compel the conveyance 
 to her by E. B. Blanchard and wife of the west 80 acres of said 
 farm. * * * 
 
 OwEN, J.^* * * * The court found that, within a few days . 
 after the execution of the contract alleged in the complaint, the de- 
 fendant E. B. Blanchard and his wife entered into possession of the 
 premises and personal property described in the contract, and for a 
 year and a half faithfully performed the conditions of the contract ; 
 that on or about July 8, 1905, the said E. B. Blanchard and his wife, 
 
 (1898) ; Gilbert v. Sanderson, 56 Iowa, 349, 9 N. W. 293, 41 Am. Rep. 103 
 (1881). Tliis is undoubtedly true, even after assent by the beneficiary, in 
 the case of a bilateral contract, where the promisor's duty is conditional on 
 perfoiTnance bv the promisee and they mutually rescind. Hartman v. Pisto- 
 rius, 248 111. 568, 94 N. E. 131 (1911). 
 
 Where the consideration is executed, and the third party is sole beneficiary,, 
 the promisee has been held to have no power to discharge even before notice 
 to the beneficiary. Tweeddale v. Tweeddale, 116 Wis. 517, 93 N. W. 440, 61 
 L. E. A. 509, 9"B Am. St. Eep. 1003 (1903) ; Wetutzke v. W6tutzke, 158 Wis. 
 305, 148 N. W. 1088 (1914). The right of the beneficiary of a life insurance 
 policy is generally held to be irrevocable by the insured, even prior to any 
 knowledge or assent by the beneficiary, unless the power of revocation is 
 reserved in the policy. Such a power may of course be reserved. See Roberts 
 V. Northwestern Nat. Life Ins. Co., 143 Ga. 780, 85 S. B. 1043 (1915). 
 
 A sole beneficiary has the power' of discharge, even against the will of the 
 promisee. Meyer v. Walker-Smith Grocer Co., 60 Tex. Civ. App. 462, 127 S. 
 W. 1118 (1910). 
 
 3* Part of the statement of facts and part of the opinion are omitted. 
 
 COBBIN CONT — 70 
 
1106 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 Elizabeth, having become dissatisfied with the terms of the contract, 
 voluntarily breached the same, left and abandoned said premises, 
 and left the father, H. C. Blanchard, in exclusive control thereof; 
 that about a month later the father, upon promise of making bet- 
 ter terms with them, induced them to return to the premises, and on 
 August 8, 1905, they did return to the premises, and continued to 
 work and farm the same, and to support and maintain the father 
 down to the time of his death, March 23, 1915 ; that on March 11, 
 1915, the father executed a deed to the son, whereby he conveyed the 
 entire farm to him upon condition that he provide support and main- 
 tenance for the father during the remainder of his life, and upon his 
 death pay to the plaintiff, Edith Sedgwick, the sum of $1,000. * * * 
 Whatever right the plaintiff, Edith Sedgwick, has to a conveyance 
 of the 80 acres claimed by her, is referable to the contract of De- 
 cember 31, 1904. As we have seen, the terms and conditions of that 
 contract were never executed. The contract was breached by E. B. 
 Blanchard, who left the premises, refused to further perform the 
 conditions thereof, and the father, H. C. Blanchard, was restored to 
 the exclusive possession of the farm and personal property. The 
 contract itself provided that the failure of the said E. B. Blanchard 
 to keep or perform any of the conditions thereof should render the 
 contract null and void. It is difficult to perceive why, in view of 
 that provision in the contract itself, the breach thereof on the part 
 of E. B. Blanchard, coupled with a re-entry on the part of the fa- 
 ther, did not effectually put an end to the contract and all rights 
 created by it. It is true that this court has gone a great ways in 
 sanctifying contracts made for the benefit of third parties. In We- 
 tutzke, V. Wetutzke, 158 Wis. 305, 148 N. W. 1088, in a similar trans; 
 action between father and son, where the son agreed to pay cer- 
 tain sums to third parties, and executed a mortgage to secure such 
 payments, it was held that the relation of debtor and creditor was 
 established between the son and such beneficiaries, which relation 
 could not be changed by agreenient between the father and son with- 
 out the consent of the beneficiaries, and the mortgage executed by 
 the son was enforced agairist the premises, notwithstanding the fact 
 that the premises had been reconveyed to the father when it became 
 apparent that the original arrangement could not be agreeably car- 
 ried out. That case probably marks the limit to which this court 
 will go in enforcing contracts of an executory nature made for the 
 benefit of third parties. 
 
 . In the Wetutzke Case there was no provision in the contract that 
 in case of a breach thereof it should be null and void, nor was there 
 a re-entry pursuant to a breach, which facts distinguish that case 
 from this. It seems plain that the rights of plaintiff in and to the 
 premises, a conveyance of which she seeks, were put at an end up- 
 on the termination of the contract by its own terms upon the oc- 
 casion of the breach thereof by E. B. Blanchard July 8, 1905, fol- 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1107 
 
 lowed by a re-entry on the part of the father, and that she cannot 
 compel a conveyance thereof. 
 
 It is argued by respondents that the defendants should not be 
 permitted to profit by their own breach of the original contract. We 
 fail to appreciate the force of this argument. Upon the breach of 
 the contract the father was in a position where he was compelled 
 to negotiate with some one relative to the management of the farm 
 in such a way as would assure him his future support and mainte- 
 nance. It is quite plain that, if he had entered into an arrangement 
 with a third party, plaintifJ would have had no claims upon such 
 third party. We know of no reason why his right in this respect 
 should be limited to third parties, nor why he and his son might 
 not enter into a new arrangement, with the same force and effect 
 that would be accorded an agreement between the father and a third 
 person. The first contract was at an end, and had no more exist- 
 ence than as though it had never been executed. Being at an end, 
 it could constitute no barrier to the right of the father and son to 
 enter into the new arrangement. It follows, from what has been 
 said,, that the judgment should be reversed. 
 
 Judgment reversed, and cause remanded, with directions to enter 
 judgment dismissing plaintiff's complaint.^'^ 
 
 35 Where the promisor's duty to the promisee is subject to an express or im- 
 plied condition precedent, it is generally, true that his duty to the third party 
 is subject to the same condition. Knight & Jillson Co. v. Castle, 172 Ind. 
 97, 87 N. E. 976, 27 L. R. A. (N. S.) 573 (1909) ; Jenness v. Simpson, 84 Vt. 
 127, 143, 78 Atl. 886 (1910) ; Shockley v. Booker (Mo. App.) 204 S. W. 569 
 (1918) ; Americas Loan & Mortgage Co. v. American Nat. Bank (Tex. Civ. 
 App.) 205 S. W. 146 (l9l8) ; OsbOrrie v. Cabell, 77 Va. 462 (1883) ; Davis v. 
 Dunn, 121 Mo. App. 490, 97 S. W. 226 (1906) ; Supreme Council of Royal 
 Arcanum v. Behrend, 247 U. S. 394, 38 Sup. Ct. 522, 62 L. Ed. 1182, 1 A. L. R. 
 966 (1918) ; Mutual Aid Union v. Wadley, 125 Ark. 449, 188 S. W. 1168 (1916). 
 
 If the contract is void or voidable as against the promisee, on grounds of 
 fraud, mistake, or infancy, it is so likewise against the third party. Stevens 
 Inst, of Technology v. Sheridan, 30 N. J. Eq. 23 (1878), mistake; Union City 
 Realty & Trust Co. v. Wright, 145 Ga. 730, 89 S. E. 822 (1916), fraud and non- 
 performance; Arnold v. Nichols, 64 N. "E. 117 (1876), the usual rules as to 
 rescission for fraud concerning the return of the consideration, etc,, apply; 
 Oohrt V. Koch, 56 Iowa, 658, 10 N. W. 230 (1881) ; Crowe v. Lewin, 95 N. 
 Y. 423 (1884) ; Dunning v. Leavitt, 85 N. Y. 30, 39 Am. Rep. 617 (1881) ; 
 Green v. Turner (CO.) 80 Fed. 41 (1897) ; Id., 86 Fed. 837, 30 0. C. A. 427 
 (1898). . , 
 
 Special suretyship rules, by which a surety is discharged by certain volun- 
 tary acts of the creditor and promisee, have not been applied in favor of 
 the surety aa against a third party beneficiary who was himself innocent of 
 such acts. Equitable Surety Co. v. United States, to use of W. McMillan & 
 Son, 234 U. S. 448, 34 Sup. Ot. 803, 58 L. Ed. 1394 (1914) ; School Dist. of 
 Kansas City ex rel. Koken Iron Works v. Livers, 147 Mo. 580, 49 S. W. 507 
 (1899) ; Victoria Lumber Co. v. Wells, ,139 La. 500, 71 South. 781, L. R. A. 
 1916E, 1110, Ann. Cas. 1917E, 1083 (1916) ; Cowles v. United States Fidelity 
 & Guaranty Co., 32 Wash. 120, 72 Pac. 1032, 98 Am. St. Rep. 838 (1903) ; 
 Conn V. State ex rel. Stutsman, 125 Ind. 514, 25 N. E. 443 (1890) ; Steffes v. 
 Lemke, 40 Minn. 27, 41 N. W. 302 (1889). 
 
1108 THIRD PARTY BENEFICIARIES (Ch. 6 
 
 JONES V. COMMONWEALTH CASUALTY CO. 
 (Supreme Court of Pennsylvania, 1917. 255 Pa. 566, 100 Atl. 450.) 
 
 Assumpsit by ,Mary A., Jones on a beneficial society certificate 
 against the Commonwealth Casualty. Company, reinsurer. Verdict 
 for plaintiff for $5,393.33, and judgment thereon, and defendant ap- 
 peals. Reversed and new trial granted. 
 
 Frazer, J. Plaintiff sued to recover the amount due under a mem- 
 bership certificate in a beneficial society which provided for payment 
 to the beneficiary of a sum of money in case of death of the member 
 through external, violent, and accidental means. At the trial defend- 
 ant offered in evidence the application for membership and the by- 
 laws of the society. These, however, were excluded for the reason 
 they were not attached to the certificate of membership. The ques- 
 tion whether the death of the deceased was the result of an injury 
 received by him about a month previous thereto was stibrnitted to the 
 jury, and a verdict rendered in favor of plaintiff. Defendant appeals, 
 the questions raised being whether there was sufficient, evidence to 
 show death was due to the injury complained of to warrant submis- 
 sion of the case to the jury and whether the court erred in excluding 
 deceased's application for membership and also the by-laws of the 
 society.^* * * * 
 
 Deceased held a certificate of membership in the Fraternities Acci- 
 dent Order, a beneficial corporation organized under the laws of this 
 state. The certificate was issued in 1898, subject to the "condition 
 that the statements and representations made by him in the applica- 
 tion for membership *■ * * are true, and that said application 
 and the laws of the order as now in force, or as hereafter enacted by 
 the grand council, be made a part of this contract," deceased was con- 
 stituted a fifth rate member, and the order promised "to pay out of 
 its benefit fund to Mary A. Jones, wife, a sum not exceeding $5,000 
 in accordance with and under the provisions of the laws governing 
 said order and -fund upon satisfactory^ evidence of the, death of said 
 member through external, violent, and accidental means." In 1906 
 the defendant, a corporation organized under the laws of Pennsylvania 
 as a corporation of the second class, took over the obligations of the 
 Fraternities Accident Order, including the policy or certificate of de- 
 ceased, by attaching to the certificate the following memorandum : 
 "For value received the Commonwealth Casualty Company hereby 
 agrees to assume all the covenants and agreem^ts of the Fraternities 
 Accident Order contained in the certificate of membership of the t'ra- 
 ternities Accident Order to which this agreement is attached issued 
 to the above-named member under and subject to the stipulatiqns and 
 conditions therein contained to be performed by said member.',' 
 
 ^" Part of the opinion, dealing with the first question, is omitted. 
 
Ch. 6) THIRD PARTY BENEFICIARIES 1109 
 
 Defendant alleges that deceased, subsequent to the date of the 
 certificates, changed his occupation so as to increase the risk, and 
 thereby was taken out of the "preferred list" class and was not en- 
 titled to hold membership or receive benefits as such, and, in support 
 of this contention, offered in evidence the application for membership 
 and by-laws of the order. This evidence was objected to and excluded 
 for the reason above stated that the application and by-laws were not 
 attached to the certificate, as required by the act of May 11, 1881 (P. 
 L. 20). Had this action been founded on a policy of insurance issued 
 by defendant there can be no doubt but that the provisions of the 
 act would be applicable, as its provisions have been held to apply to 
 accident insurance companies. Pickett v. Pacific Mutual Life Ins. 
 Co., 144 Pa. 79, 22 Atl. 871, 13 L- R. A. 661, 27 Am. St. Rep. 618. 
 The act does not-, however, apply to beneficial societies, and the ap- 
 plication and by-laws of an association of this class may be received 
 in evidence though not attached to the certificate of membership. 
 Dickinson v. Ancient Order United Workmen, 159 Pa. 258, 28 Atl. 
 293; Marcus v. Heralds of Liberty, 241 Pa. 429, 88 Atl. 678; Lith- 
 gow V. Supreme Tent of Knights of Maccabees of the World, 165 Pa. 
 295, 30 Atl. 830. Although as was decided in Marcus v. Heralds of 
 Liberty, supra, the mere form of the organization is not conclusive, 
 if it is in fact carrying on an insurance business rather than that of a 
 benevolent association, there is no contention here that the certificate 
 as issued by the Fraternities Accident Order was a policy of insurance 
 within the meaning of the act. Only by virtue of the taking over of 
 the contract by the Commonwealth Casualty Company, the defendant, 
 is the argument made that the policy is brought within the Act of 
 1881. 
 
 When defendant took over the contract it did not issae a new poli- 
 cy, it merely assumed "all the covenants and agreements of the Fra- 
 ternities Accident Order" under the certificate issued by the Society, 
 subject to the "stipulations and cbnditions therein contained to be 
 performed by said member." This did not efiect a novation; the 
 original contract remained as before, the proceeding being more in 
 the nature of a transaction of a third person guaranteeing the carry- 
 ing out of a contract as made. There was no agreement to release 
 the Fraternities Accident Order from, liability ; neither was a new 
 contract created. 
 
 The essentials of a novation are the displacement and extinction of 
 a former contract, the substitution of a new agreement, a sufficient 
 consideration therefor and consent of the parties thereto. Wright v. 
 Hanna, 210 Pa. 349, 59 Atl. 1097; Curtin v. People's Nat. Gas Co., 
 233 Pa. 397, 82 Atl. 503. 
 
 The burden is upon one who alleges a novation to establish it by 
 proper proof; and, in absence of an agreement that the original 
 obligation should be extinguished, and a new one substituted,_and the 
 original debtor relieved, the mere acceptance of the obligation of a 
 
1110 THIRD PAKTY BENEFICIARIES (Ch, 6 
 
 third person will be considered as additional security.'^ McCartney 
 V. Kipp, 171 Pa. 644, 33 Atl. 233. The transaction in the present 
 case was merely an undertaking by defendant to assume the obliga- 
 tions 'of the beneficial society under its certificate for a consideration 
 moving between themselves. So far as the member was concerned, 
 the original undertaking remained in force, and no' new agreement 
 was substituted, nor- is there evidence of an agreement on the part of 
 the member to release the society from its obligation. The certificate 
 remained the obligation of the beneficial society, and defendant mere- 
 ly undertook to carry out its terms. The certificate or policy, not 
 being within the act of 1881, when originally issued, did not come 
 within its provisions by the undertaking on the part of defendant to 
 carry out its terms. Defendant stood in the same position as the 
 beneficial society, succeeded to its rights and privileges under the 
 contract, and became liable only to the same extent as the society was 
 liable. Deceased's application for membership and the by-laws of the 
 society should have been received therefore for the purpose of ac- 
 curately determining the extent of defendant's liability. As these 
 documents are not included in the record before us, the case must be 
 sent back for retrial. 
 
 The second assignment of error is sustained, the judgment re- 
 versed, and a new trial granted.^* 
 
 ^'' This is the better rule. Fischer v. Hope Mut; Life Ins. Co. of New York, 
 69 N. T. 161 (1877) ; Rodenharger v. Bramblett, 78 Ind. 213 (1881) ; Davis t. 
 Hardy, 76 Ind. 272 (1881) ; Gay v. Blanchard, 32 La. Ann. 497, 505 (1880), 
 "true, there was no novation of the debt; there was simply an additional 
 obligor bound for it"; Feldman v. McGnire, 34 Or. 309, 55 Pac. 872 (1899) ; 
 Smith V. Pfluger, 126 Wis. 253, 105 N. W. 476, 2 L. R. A. (N. S.) 783, 110 
 Am. St. Rep. 911 (1905) ; Leckie v. Bennett, 160 Mo. App. 145, 141 S. W. 706 
 (1911). See, also, Poe v. Dixon, 60 Ohio St. 124, 54 N. B. 86, 71 Am. St. Rep. 
 713 (1899). 
 
 This is necessarily true in mortgagee beneficiary eases, where the court 
 bases the mortgagee's right against the grantee who has assumed the debt 
 upon the doctrine of subrogation. See Hopkins v. Warner, 109 Cal. 133, 41 
 Pac. 868 (1895). 
 
 But there are cases holding that the third party must elect between his 
 former debtor and the new promisor, and that a suit against either one will 
 bar any action against the other even though it does not result in collection. 
 Bohanan v. Pope, 42 Me. 93 (1856) ; Wood v. Moriarty, 15 R. I. 518, 9 Atl. 
 427 (1887) ; Wairren v. Batchelder, 16 N. H. 580 (1845). See, also, Aldrich v. 
 Carpenter, 160 Mass. 166, 35 N. E. 456 (1893). 
 
 38 wjiere an insurance company reinsures its risk, the contract of reinsur- 
 ance may be so worded as to create a right in the policy holder against tfte 
 new company. See Federal Life Ins. Co. v. Bamett (Ind. App.) 125 N. B. 522 
 (1919). 
 
Ch. 7) ASSIGNMENT HU 
 
 4i 
 
 CHAPTER VII 
 
 ASSIGNMENT 
 
 MOWSE V. EDNEY. 
 (In the Queen's Bench, 1600. KoUe's Abr. 20 pi. 12.) 
 
 If A is indebted to, B by bill and B indebted to C, and B in payment 
 of his debt to C assigns A's bill to him, and before the day for the pay- 
 ment of the money A comes to C and promises him that if he will for- 
 bear to enforce the payment of the money then he, A, will pay him ; 
 upon which C forbears. Still there is no consideration to maintain any 
 action on this promise, because notwithstanding the assignment of the 
 bill, still the property of the debt remains always in the assignor.^ " 
 
 HARVEY V. BATEMAN. 
 
 (About 1600. Noy, 52.) 
 
 That if a man assign an obligation to another for a precedent debt 
 due by him to the assignee, there, that is not maintenance ; but if he 
 assign it for a consideration then given by way of contract, that is 
 maintenance.^ Ve. 34 H. 6, 30. 
 
 CASE OF BRADSHAW et al. 
 (In the Common Pleas, 1605. Cro. Jac. 105.) 
 
 Divers debts were assigfned to the plaintiffs, being creditors, by the 
 commissioners upon the statute of 13 Eliz. c. 7, of Bankrupts, and they 
 
 1 Cf. Barrow v. Gray, Cro. Eliz. 551 (1597). Even when EoIIe was making 
 this statement, the assignee could sue in the courts of common law in the 
 name of the assignor, acting in accordance with a written power of attorney 
 or in accordance with a power to be inferred from the mere fact of the as- 
 signment itself. Soon after this, the Court of Chancery recognized and en- 
 
 • forced the rights of an assignee, allowing him as matter of course to sue in 
 his own name. See Fashion v. Atwood, 2 Cas. in Oh. 36 (1680) ; Crouch t. 
 Martin, 2 Vernon, 595 (1707) ; Bow v., Dawson, 1 Ves. Sr. 331 (1749). 
 
 2 The reason why ehoses in action were not assignable in early law was 
 probably the fact that people were unaccuistomed to doing business except by 
 transferring physical articles. It was not due to the subsequently developed 
 theories concerning illegal maintenance of suits. These later theories tended 
 for a time to support the rule of nonassignability when it was being undermin- 
 ed by modern business practice ; but they play little part in the law of assign- 
 ment to-day. See Ames, "The Inalienability of Choses in Action," III Essays 
 Anglo-Amer. Legal Hist. 580 ; Fitzroy v. Cave, [1905] 2 K. B. 364, 5 Brit. E. 0. 
 601. 
 
1112 ASSIGNMENT (Ch. 7 
 
 sued an action in their own names for those debts. — And it was ruled, 
 that it well lies ; for it is a debt transferred by Parliament. 
 
 Being upon a contract, the defendant gaged his law, and was admit- 
 ted thereto; for although the Parliament transferred the debt, yet it 
 is not any debt of record ; but as he might have gaged his lav/ against 
 the bankrupt, so he may against the plaintiffs.^ 
 
 REDFIEIvD V. HILIvHOUSE. 
 (Superior Court of Connecticut, 1774. 1 Root, 63.)* 
 
 Scire facias against him, as agent and factor to Isaac Colton, an ab- 
 sconding debtor. 
 
 The case was — Isaac Colton assigned a note he had against one 
 Hull, to William Colton, with a power of attorney; William puts it 
 into the hands of Mr. Hillhouse to collect, and he collected the mon- 
 ey upon it ; Redfield instituted an action against said Isaac as an ab- 
 sconding debtor, and served Mr. Hillhouse with a copy; he recovered 
 a judgment and execution against Isaac and the execution was return- 
 ed non est inventus, and thereupon he brings this scire facias against 
 Mr. Hillhouse; and the defendant pleads that he never was agent, 
 factor or attorney to said Isaac, etc. 
 
 The only question upon this issue, was-*— Whether the property of 
 this money was in Isaac, the promisee, or in William, the assignee of 
 the note? 
 
 The Court decided the property to be in the assignee, and that said 
 Hillhouse was not agent, factor or attorney to said Isaac' * * * 
 
 WINCH V. KEEIvEY. 
 
 (In the King's Bench, 17S7. 1 Term R. 619, 99 Eng. Rep. 1284.) 
 
 Indebitatus assumpsit for work and labour, money paid, laid out, 
 and expended, money lent, and on an account stated. 
 
 Pleas, 1st, non assumpsit. 2dly, that after the day of making the 
 promises, etc. the plaintiff became a bankrupt, etc. and that his com- 
 missioners assigned over his effects to the assignees, etc. by virtue of 
 which he the defendant is chargeable to pay the sums of money men- 
 tioned in the declaration to the assignees, etc. 3dly,. set-off for goods 
 sold and delivered, money paid, laid out, and expended, money lent, 
 and for money due on an account stated. 
 
 The replication admitted the matters contained in the 2d plea to be 
 true; and as to all the promises in the declaration mentioned, and all 
 
 s See, also, Baker v. Edmonds, Aleyn, 28 (1646). 
 
 * Part of the report is omitted. 
 
 " In accord: St. John v. Smith, 1 Root (Conn.) 156 (1790). 
 
Ch. 7) ASSIGNMENT 1U3 
 
 \ 
 
 the sums thertein contained, except as to £73. 12s. 9d. parcel, etc. the 
 plaintiff acknowledged that he would not further prosecute. Then the 
 replication proceeded as follows : And as to that sum, he says that, 
 before the time that the- plaintiff became a bankrupt in manner and 
 form as the defendant hath in his said plea alleged, the said defendant 
 was indebted to him the said plaintiff in the several sums of money in 
 the said declaration mentioned, and that he the said plaintiff was also 
 indebted to the said defendant in certain other large sums of money; 
 and that upon an account fairly and justly taken between the said 
 plaintiff and the said defendant there was then due and owing from 
 the defendant to him the said plaintiff, on the balance of such account, 
 the sum of i73. 12s. 9d. for and on account of the several sums of 
 money in the third and fourth counts of the said declaration mention- 
 ed, over and above all sums of money whatsoever due and owing from 
 the said plaintiff to the said defendant, that is to say, at Westminster 
 aforesaid; and the said plaintiff farther saith, that he the said plain- 
 tiff, before the time that he became and was a bankrupt in manner and 
 form as in the said plea mentioned, to wit, on .the 20th of October 
 1785, at Westminster aforesaid, in the said county, became and was 
 justly indebted to one Joseph Searle in a large sum of money, to wit, 
 in the sum of i73. 12s. 9d. And, being so indebted, he the said plain- 
 tiff afterwards, to wit, on the day and year last aforesaid, and before 
 be became a bankrupt, to wit, at Westminster aforesaid, in the county 
 -aforesaid, by his certain deed poll, sealed with th$ seal of him the 
 said plaintiff, which said deed he the said plaintff brings here into 
 Court, the date whereof, etc. in consideration of the said sum of mon- 
 ey so as aforesaid due and owing from liim the said plaintiff to the 
 said Joseph Searle, did bargain, sell, assign, and transfer to the said 
 Joseph Searle the said sum of £73., 12s. 9d. parcel of the money in the 
 said declaration mentioned ; to hold the same to the said Joseph Searle 
 from thenceforth to his own proper use, under a certain proviso there- 
 in and hereinafter mentioned ; and did thereby constitute and appoint 
 the said Joseph Searle his true and lawful attorney irrevocably, and 
 did give and grant unto him, his executors and administrators, full 
 •power and authority in his name, to the only proper use and behoof of 
 the said Joseph, to ask, demand, and sue for, the aforesaid sum of 
 £73. 12s. 9d. Provided always, that if he the said plaintiff, his execu- 
 tors or administrators, should well and truly pay, or cause to be paid, 
 unto the. said Joseph the said sum of £73. 12s. 9d. so due and owing to 
 him as aforesaid, within two calendar months after the date of those 
 presents, then the said deed-poll, and every article and clause therein 
 - contained, should be void; as by the said deed-poll, relation being 
 thereunto had, may more fully appear. And the said plaintiff further 
 saith, that he did not, at any time within the space of two calendar 
 months after the date of the said deed, pay to the said Joseph the said, 
 sum of £73. 13s. 9d. so due and owing to him as aforesaid, but that 
 the same hath from thence hitherto remained due and unpaid from the 
 
1114 ASSIGNMENT (Ch. 7 
 
 said plaintiff to the said Joseph; and that the original writ in this 
 suit was sued out in the name of him the said plaintiff for and on the 
 behalf of the said Joseph Searle,, and for the purpose of enabling the 
 said Joseph Searle to receive the said sum of iTh. 12s. 9d. parcel of 
 the said sums in the said declaration mentioned, according to the form 
 and effect of the said deed poll, and not for the benefit, use, or behoof, 
 of the said plaintiff, that is to say, at Westminster aforesaid, in the 
 county aforesaid; and this he is ready to verify, wherefore he prays 
 judgment, etc. as to the said i73. 12s. 9d. To this replication there 
 was a genera! demurrer and joinder. 
 
 Morgan in support of the demurrer, contended that this debt, being 
 a chose in action, could not be assigned. Co. L,itt. 214a. 2 Rol. Abr. 
 45, F. 6. Although the King by his prerogative may assign a chose 
 in action, yet his grantee cannot. Cro. EHz. 180. Bills of exchange 
 are assignable by the law of merchants; but promissory notes can 
 only be assigned under the 3 & 4 Ann. c. 9, which shews that at com- 
 mon law they could not; That being the law generally, that inconven- 
 ience will result from, permitting persons subject to the bankrupt laws 
 to assign over their effects to particular creditors on the eve of a 
 bankruptcy. » 
 
 L,awrence, contra, did not dispute the general principle ; and ad- 
 mitted that if the action had been brought in the name of Searles, 
 those cases would have applied; and that this assignment could not 
 have been supported if it had been fraudulent. But he observed 
 that the question here was, whether a chose in action can be as- 
 signed for an antecedent debt, so that the assignee may recover on 
 it in the name of the assignor. The cases cited only prove that the 
 action cannot be maintained by the assignee. It cannot now be dis- 
 puted that Courts of Equity will, protect a chose in action when as- 
 signed; and Courts of Law have frequently permitted the assignee 
 to sue in the name of the assignor. A Court of Equity has held 
 such an assignment to be good, even though the assignor after- 
 wards became a bankrupt. Unwin v. Oliver, cited by Eord Mans- 
 field, in 1 Burr. 481. Ex parte Byas, 1 Atk. 124. If then such an as- 
 signment be good in a Court of Equity, the only question is, whether 
 or not this Court will take, notice of such a trust. Now Courts of 
 Law have taken notice of trusts in many instances. In the case of 
 Bottomley v. Brooke, M. 22 G. 3, C. B. (Vide 2 Black. Rep. 1271), 
 which was debt on bond, the defendant pleaded that the bond was 
 given for securing £100. lent to the defendant by one E. Chancellor, 
 and was given by her direction to the plaintiff in trust of her, and 
 that E. Chancellor, before the action brought, was indebted to the 
 defendant in more money than the amount of the bond; to this 
 there was a demurrer, which was withdrawn by the advice of the 
 Court. So that the Court there did not look to the person legally 
 entitled, but to her who was beneficially interested in the bond. The 
 authority of this case was afterwards recognized in that of Rudge 
 
Ch. 7) ASSIGNMENT 1115 
 
 V. Birch, M. 25 G. 3, B. R., in this Court, where, to debt on bond the 
 defendant pleaded, that the bond was given to the plaintiff in trust 
 for A. for a debt due from the defendant to A.; and that A. at the 
 time of exhibiting the plaintiff's bill was indebted to the defendant in 
 more money. The plaintiff demurred, and the Court, on the au- 
 thority of the case of Bottomley v. Brooke, held this to be a good 
 plea. It has likewise been since recognized in Webster v. Scales, M. 
 25 Geo. 3, where.it was held by the Court that a bankrupt's interest 
 as a trustee was not assignable by the commissioners. Immediate- 
 ly on this assignment the plaintiff became a mere trustee ; if so, this 
 case falls within the principle of that of Webster v. Scales. For 
 by the 1 Jac. 1, c. 15, § 15, the commissioners are only empowered 
 to assign those things which are for the benefit of the bankrupt. 
 Therefore this debt could not pass under the assignment from the 
 bankrupt's commissioners to his assignees; because, when recov- 
 ered, it cannot be applied to the bankrupt's benefit. 
 
 Morgan in reply. There is no doubt but a chose in action may 
 be assigned in equity; but the question here is, whether it can be 
 so assigned in a Court of Law. In Bottomley v. Brooke, the par- 
 ties had only done what they lawfully might; the bond was orig- 
 inally given to the plaintiff for the benefit of Mrs. Chancellor; and 
 on an account between her and the defendant she would have been 
 found indebted to him : but no question there arose concerning the 
 assignment of a chose in action. In the case of Rudge and Birch 
 the plaintiff was a trustee: but here the plaintiff is not to be con- 
 sidered in that light ; because he was the original debtor, and unless 
 ' he could assign a chose in action, his interest in the bond is now 
 vested in his assignees. 
 
 AsHHURST, J. The cases which have been cited by the plaintiff's 
 counsel go a great way in determining this question. It is true that 
 formerly the Courts of Law did not take notice of an equity or a 
 trust; for trusts are within the original jurisdiction of a Court 
 of Equity, but of late years, it has been found productive of great 
 expense to send the parties to the other side of the Hall; wherever 
 this Court have seen that the justice of the case has been clearly with 
 the plaintiff, they have not turned him round upon this objection. 
 Then if this Court will take notice of a trust why should they not 
 of an equity? It is certainly true that a chose in action cannot 
 strictly be assigned : but this Court will take notice of a trust, and 
 consider who is beneficially interested; as in Bottomley v. Brooke, 
 where the Court suffered the defendant to set off a debt due from 
 Mrs. Chancellor in the same manner as if the action had been 
 brought by her. The only difference between that case and this is, 
 that there the plaintiff himself was not originally interested in the 
 debt, but this plaintiff was : but that does not make any essential 
 difference, because if it be once established that this Court will take 
 notice of trusts, it is immaterial whether the person who sues were 
 
1116 ASSIGNMENT (Ch. 7 
 
 originally a trustee or afterwards becomes so. Nor is it material at 
 what time they became a trustee; for whether he became such by 
 the assignment, or was so originally, it is sufficient to say that he 
 is a trustee now, and as such has a right to maintain this action. If 
 this had been a fraudulent assignment, it would have raised a dif-- 
 ferent question: but on these pleadings it must be taken to have 
 been assigned for a valuable consideration. The case of Webster 
 and Scales is in point ; and on the authority of that and on the other 
 cases cited, I am of opinion that the plaintiff may recover. 
 
 Bui^LER, J. This action is brought in the name of the assignor of this 
 bond; and therefore it does not involve in it the question whether 
 a chose in action may be so assigned as to give a legal title to the 
 assignee. The plea only says, that the plaintiff is become a bank- 
 rupt, and that this debt is transferred to his assignees; the answer 
 to that is, that this is a debt due in form to the plaintiff, but in sub- 
 stance to a third person; and therefore it is not such a debt as passed 
 under the commission; if not, it is still in the plaintiff, and he is en- 
 titled to maintain this action. The statute of the 1 Jac. 1, c. 15, only 
 says that such debts are to be assigned as are for the benefit of the 
 bankrupt. This construction was put upon the statute soon after 
 it passed in a case in March, 38 ; where it was held that such things 
 as the bankrupt held as trustee did not pass under the commission. 
 Here it must be taken on these pleadings that this debt: did not pass 
 under the commission; therefore it remained in the bankrupt, and 
 he may maintain this action. 
 
 Judgment for the plaintiff." 
 
 CAMP v. TOMPKINS. 
 (Supreme Court qt Errors of Connecticut, 1833. 9 Conn. 545.) 
 
 This was an action of assumpsit, brought by Tompkins against 
 Henry L. Camp. The 'declaration comprised four counts, the three 
 first being special, and the last general, for money had and received 
 to the plaintiff's use. In the former, the plaintiff averred, that in 
 November 1829, Lyman C. Camp, being indebted to him in a large sum 
 of money, delivered to him a promissory note, signed by Henry Hoyt,. 
 dated October 1st, 1829, for 61 dollars, 62 cents, payable to the or- 
 der of Henry L,. Camp, on demand; which the plaintiff received in 
 part payment of his debt, and gave notice thereof to Hoyt; that Ly- 
 man C. Camp then was, and ever since has been, insolvent; that tliis 
 ,note, by mistake and inadvertence, was made payable to the defend- 
 ant, instead of Lyman C. Camp, who, at that time, and at the time 
 of transferring the note, was, with the assent of the defendant, the 
 holder thereof, and entitled to the money due thereon; that the de- 
 
 "In accord.: Parsons v. Woodward, 22 N. J. Law, 196 (1849). 
 
Ch. 7) ASSIGNMENT 1117 
 
 fendant, knowing the premises, but intending to defraud the plain- 
 tiff, on the 8th of February, 1830, obtained payment of said note from 
 Hoyt, and gave him a discharge therefrom ; and by means of the prem- 
 ises, defendant became liable to pay, and in consideration therepf, 
 promised to pay, &c. 
 
 On the trial, before the city court of the city of Middletown, on 
 the general issue, the plaintiff claimed to have proved the facts al- 
 leged in the special counts, but offered no evidence of any, express 
 agreement by the defendant, or of any other facts than those stated 
 in the special counts, in support of the general count. The defend- 
 ant insisted, that these facts, if proved, did not entitle the plaintiff to 
 a verdict; and prayed the court so to instruct the jury. The court 
 instructed the jury, that if they should find the facts as claimed by the 
 plaintiff, the defendant thereupon became liable, and the law implied a 
 promise on his part, to pay to the plaintiff the sum specified in Hoyt's 
 note, with the interest. The jury returned a verdict for the plaintiff, 
 on which judgment was rendered. * * * 
 
 Williams, J. * * * But if it is admitted, that this plaintiff can- 
 not maintain a suit, in his own name, on the note, it must, I tliink 
 also be admitted, that he might maintain a suit in the name of the prom- 
 isee, for the benefit of the bona fide owner, as well as in any other casfe 
 where the legal interest is not transferred. Tompkins, upon the facts 
 presented in this case, must have all the rights that the assignee of a 
 chose in action not negotiable could have had. 
 
 What, then, are these rights? It is well known, that an entire rev- 
 olution in opinion has taken place upon that subject. The antipathy, 
 which formerly existed against the assignment of a chose in action, 
 has gradually yielded to sentiments more congenial to the demands of 
 commerce and the state of society. The history of this change is 
 given by Judge Buller, in his able opinion in the case of Master v. 
 Miller, 4 T. R. 320, 341. He there held, that the courts of law in 
 that country,. had, on that subject, adopted all the principles of a court 
 of equity; except that they would not allow a suit in the name of the 
 assignee; and he did not hesitate to say, that he saw no use in pre- 
 serving the shadow, when the substance was gone. And in pursuance 
 of that opinion, the courts in that country have refused to suffer a 
 defendant, who had notice of an assignment of a chose in action, to 
 plead a discharge from the assignor obtained after such assignment. 
 Legh v. Ivegh, 1 Bos. & Pull. 447. 
 
 Such also is the law of New York. 
 
 And our legislature, in May, 1822, enacted, that such a discharge, 
 admission, &c. should have no effect other than it would have in a 
 court of equity. Stat. vol. 2, p. 19. 
 
 Our courts also early decided, that after assignment and notice, 
 the debt could not be taken, by foreign attachment, as the property 
 of the debtor, (Willes v. Pitkin, 1 Root, 47; Redfield v. Hillhouse, 
 
1118 ASSIGNMENT (Ch. 7 
 
 1 Root, 63; Fobs v. Brewster & al., 1 Root,, 234; Tudor Wood- 
 hridge & Co. v. Perkins, 3 Day, 364,) and that an action at law will 
 lie against the promisor for taking, or the promisee for giving a dis- 
 charge, after assignment and notice, if a loss accrues thereby. Cole- 
 man V. Wolcott, 4 Day, 28, 29. 
 
 They have also held, that such assignee is so far the real cred- 
 itor, that if the debtor petition for an act of insolvency, the assignee, 
 and not the assignor, is to be notified as the creditor, as he alone could 
 receive payment. Colboum v. Rossiter, 2 Conn. 503, 508. In that 
 case, it is said, by Smith, J., that "whenever any collateral injury 
 is done to the debt, such as obliterating, destroying, or converting the 
 note wrongfully to the use of another; or any injury to process on 
 the note, such as rescous or escape; the action may, and ought to 
 be, brought in the name of the assignee;" and Gould, J., says, "in 
 such actions, the rights of the assignee are a proper subject of aver- 
 ment, and courts of law recognize and protect them;" and Hosmer, 
 J., says, "the whole beneficial interest is in him, and of this a court 
 of law is authorized to take cognizance." And in Lyon v. Summers, 
 7 Conn. 400, 406, Daggett, J., says: "This title will be recognized 
 in a court of equity, and also in a court of law, and fully protected. 
 It must be sued in the name of the promisee; and is liable to all the 
 equity, which subsisted between the original parties." 
 
 The rule, then, I understand to be established, in this State, that 
 the assignee of a chose in action not negotiable, has all the rights of 
 the assignor, except that of commencing a suit in his own name. And 
 if so, it would seem to follow, that whenever the action was not upon 
 the obligation itself, it might be brought in the name of him who had 
 the beneficial interest ; and that in this case, when the debt was paid, 
 the payment must be considered as made for the benefit of him who 
 had the beneficial interest. 
 
 It is, however, objected, that there was no privity of contract be- 
 tween this plaintiff and defendant. This must . depend upon the 
 right of the plaintifiE ; for if he has a right to this note, by the as- 
 sent of this defendant, this, objection cannot prevail. There is al- 
 ways a supposed privity of contract between the person whose money 
 it lawfully is and the person who has received it. Kitchen & al. v. 
 Campbell, 3 Wils. 304, 307. And in the case of the Eagle Bank v. 
 Smith, 5 Conn. 71, 75, 13 Am. Dec. 37, it was held, that in this action 
 no privity was necessary. And the court say, this doctrine of priv- 
 ity in the action for money had and received, is in direct opposition 
 even to the common cases in which the action is sustained. 
 
 The case of Williams v. Everett & al., 14 East, 582, differs entirely 
 from this, as there was an express dissent. 
 
 In connection with this, it was also once insisted upon, that this 
 action was founded upon a tort, and was not within that class of 
 cases where the tort could be waived. But the cases of L,ightly v. 
 Clouston, 1 Taun. 112, and Foster v. Stewart, 3 M. & S. 191, shew, 
 
Ch.7) 
 
 ASSIGNMENT 
 
 1119 
 
 that this objection is not tenable; and in Smith v. Jameson, 5 T. R. 
 601, 603, Buller, J., in answer to the objection that a breach of trust 
 may not be the ground of an action of assumpsit, says, there is not 
 an abridgement in the law, which does not contradict that proposition. 
 The great objection, however, is, that the plaintiff has only an equi- 
 table, and not a legal interest, and so ought to seek redress in a court of 
 equity. The principle of the case cited above as to the assignment of 
 choses in action, is in direct hostility to this claim — Whose was this 
 note? Had it been lost, who could have maintained an action for it? 
 Had it been discharged, who could have maintained an action for giying 
 or receiving such discharge? Had the assignor and assignee iDoth 
 absconded, whose effects would this money have been, under our 
 foreign attachment law ? In short, whose was the beneficial interest ? 
 This question must be considered as settled. If so, it seems to me to 
 follow, of course, that the moment the money was paid by Hoyt, it 
 became the money of Tompkins ; and that he had as good right to it, 
 as if it had been paid to his attorney or a sheriff on an execution. 
 Courts of law now treat a mortgagor as the real owner of the land, 
 as well as courts of equity, although he has not a legal title; and 
 why the same principles should not apply to this case I cannot 
 
 The note then, was the note of the plaintiff ; and although he might 
 not have been able to enforce the collection, by a suit in his own name, 
 yet when the money was paid, that technical difficulty does not exist, 
 and the money is to be considered as his own; and a suit may be 
 brought in his own name against the person who detains it. 
 
 I am further of opinion, that whether the right to this money is 
 either an equitable or a legal right, the plaintiff may sustain this 
 action. This action for money had and received is in nature of a bill 
 in equity, and the gist of the action is, that the party is obliged by the 
 ties of equity and natural justice, to refund the money. * * * 
 
 It seems to me, that in this case, there can be no difficulty, even if 
 the plaintiff's interest is considered a mere equitable interest. When 
 this defendant received this money, the fair inference, and the only 
 inference consistent with his integrity, is, that he received it for the 
 use of the plaintiff ; and if so, the law will imply an obligation in him 
 to refund it. And I can say, with Ch. J. Willes, when the equity of 
 the case is clearly with the plaintiff, I will always endeavour, if I can, 
 and if it be any way consistent with the rules of law, give him relief 
 at law. 
 
 I can, therefore, see no error in the charge of the city court, or in 
 the judgment of the superior court. 
 
 The other Judges were of the same opinion. 
 
 Judgment affirmed.'^ 
 
 ■^ Storrs, for the defendant, argued that "Lyman O. Camp had only an equi- 
 table interest, and so could transfer only an equitable interest to the plain- 
 tiff, whose remedy is in equity only" ; also that "the action for money had and 
 
1120 ASSIGNMENT (Ch. 7 
 
 JEMISON V. TINDALL. 
 (Supreme Court of New Jersey, 1916. 89 N. J. Law, 429, 99 Atl. 408.) 
 
 Action by Margaret R. Jemison against Enoch N. Tindall. From 
 a judgment for plaintiff, defendant appeals. Affirmed, 
 
 Parker, J. The appellee, plaintiff below, employed appellant, Tin- 
 dall, and two other men, named Miller and Cohen, to sell her farm, 
 and agreed in writing to pay them $300 commission, w;hich they 
 earned by effecting a sale. Mrs. Jemison then paid the commission 
 to Tindall, who receipted both for himself and the others, but concealed 
 from them the fact of payment. Later they learned of it, and, in- 
 stead of bringing suit against Tindall for their shares of the commis- 
 sion, sued Mrs. Jemison jointly and recovered judgment against her 
 for $200 as for their shares in the amount earned. The propriety 
 of that judgment is not in question here. Mrs. Jemison paid the judg- 
 ment, at the same time taking from Miller and Cohen an assignment 
 by parol of their claim against Tindall, and then sued him to recover 
 back so much of the commission as her assignors were entitled to have 
 on a settlement between them and Tindall. This the ,trial court. found 
 was $150 and gave her a judgment for that amount and interest, from 
 which Tindall appeals. 
 
 The principal point urged for the appellant is that the parol assign- 
 ment was invalid, or, at most, enforceable only in equity; but neither 
 branch of this proposition is sound. -A chose in? action arising out of 
 contract is assignable by parol (Hutchings v. L,ow, 13 N. J. Law, 246; 
 Allen V. Pancoast, 20 N. J. Law, 68 ; Sullivan v. Visconti^ 68, N. J. 
 Law, 543, 549, 53 Atl. 598; New Jersey Produce Co. v. Gl.uck, 79 
 N. J. Law, 115, 74 Atl. 443), in which last case the subject of assign- 
 ment was a right of action on book account. And by section 19 of the 
 Practice Act of 1903 (P. L. p. 540), choses in action arising on contract 
 are assignable at law, and the assignee may sue thereon in his own 
 name. This is applicable to suits in district courts. C. S. p. 1977, 
 § 68.» 
 
 received lies only wliere the plaintiff has a legal title to the money sought; 
 the effect of maintaining this action would be, to make choses in action as- 
 signable at law to all intents." 
 
 The argument of counsel and part of the opinion of the court are omitted. 
 
 If an assignor receives payment, the debtor having no notice, he holds the 
 money in trust for the assignee. See Garrott v. . Jaffray, 73 Ky. (10 Busn) 
 413 (1874) ; Brown v. Brown (N. Y. Gen. T.) 40 Hun, 418 (1886) ; Puter- 
 baugh V. McCray, 25 Cal. App. 469, 144 Pac. 149 (1914). 
 
 8 By statute everywhere in this country contract rights and other choses in 
 action have been made assignable, so that in an ordinary action at law the 
 assignee may (and very generally must) sue in his own name. He, and not 
 the assignor, is "the real party in interest." See Stimson, Amer. Stat. Law, 
 §§ 4031, 4032; N. Y. Code Civ. Proc. § 449; Personal Property Law, § 41 
 (Oonsol. Laws, c. 41). 
 
 Mass. Rev. Laws, c. 173, § 4, requires the assignment to be in writing to 
 enable the assignee to sue in his own name, but very informal writings may 
 
Ch.7) 
 
 ASSIGNMENT 
 
 1121 
 
 The other grounds of appeal are either irrelevant or without merit, 
 and the authorities cited in support of them need not be particularly 
 noticed. 
 
 The validity of the parol assignment being clear, Mrs. Jemison ac- 
 quired thereby the rights that Miller and Cohen jointly or severally 
 had to recover from Tindall such part of the commission as they were 
 entitled to under their arrangement with Tindall ; or if it be assumed 
 that Tindall had no right to collect the whole commission in the name 
 of the three, and that Mrs. Jemison still remained liable to Miller 
 and Cohen for their shares, she was then entitled to recover back 
 such amount as Tindall was overpaid. 
 
 In eitlier event, the judgment should ,be affirmed. 
 
 LEGH V. LEGH. 
 
 (In the Court of Common Pleas, 1799. 1 Bos. & P. 447.) 
 
 On a former day Shepherd, Serjt., shewed cause against a rule Nisi 
 obtained by Le Blanc, Serjt., for setting aside a plea of release in an 
 action on a bond, and ordering the release to be cancelled. 
 
 The case as disclosed by the affidavits in support of the rule appeared 
 ' to be this : Frances Legh having given a bond to Sarah Legh to se- 
 cure i75, Sarah assigned it to John Legh as a security for the payment 
 of a lesser sum, of which Frances had notice : John having brought an 
 action on the bond against Frances in the name of Sarah, Sarah gave 
 a release to Frances by whom she had been satisfied her debt, and this 
 release was pleaded. 
 
 Eyre, C. J. The conduct of this Defendant has been against good 
 faith, and the only question is, whether the Plaintiff must not seek re- 
 lief in a Court of Equity ? The Defendant ought either to have paid the 
 person to whom the bond was assigned, or have waited till an action 
 was commenced against him, and then have applied to the Court. Most 
 clearly it was in breach of good faith to pay the money to the assignor 
 of the bond and take a release, and I rather think the Court ought not 
 to allow the Defendant to avail himself of this plea, since a Court of 
 Equity would order the Defendant to pay the Plaintiff the amount of 
 his lien on the bond, and probably all the costs of the application. 
 
 BuLLER, J. There are many cases in which the Court has set aside 
 
 suflSce. See New England Cabinet Works v. Morris, 226 Mass. 246, 115 N. E. 
 315 (1917). This requirement does not generally prevail. See 4 Cyc. 96-98. 
 "The ancient prejudice against assigned rights of action having worn itself 
 out, the only practical consequence left is in the manner of naming the plain- 
 tiff. * * * The act [Pennsylvania statute] requires two witnesses to an 
 assignment. If the assignment has but one witness, it does not pass legal 
 title, and suit is brought in the name of the assignor to the lise of the as- 
 signee. Either assignment is good to all intents and purposes. One is a 
 legal assignment ; the other is an equitable one ; but one is as good as the 
 other." In re Hawley Down-Draft Tumace Co. (D. C.) 233 Fed. 451 (1916). 
 
 COBBIN CONT 71 
 
li22' ASSIGNMENT (CL 7 
 
 a release given to prejudice the real Plaintiff. All these cases depend 
 on circumstances. If the release be fraudulent, the Court will attend 
 to the application. 
 
 The Court recommended the parties to go before the prothonotary, 
 in order to ascertain .what sum was really due to the Plaintiff on the 
 bond. 
 
 Shepherd on this day stated that the Defendant objected going be- 
 fore the prothonotary, upon which the Court said, that the rule must 
 be made absolute. He then applied for leave to plead payment of the 
 bond, and contended that as this was not an application under the 
 Statute to plead several pleas, the Court had no discretion. 
 
 Eyre, C. J. The Court has in many cases refused to allow a party 
 to take his legal advantage, where it has appeared to be against good 
 faith. Thus we prevent a man from signing judgment who has a right 
 by law to do so, if it would be in breach of his own agreement. In 
 order to defeat the real Plaintiff, this Defendant has colluded with the 
 nominal Plaintiff to obtain a release ; and I think therefore the plea of 
 release may be set aside consistently with the general rules of the 
 Court. And if so, the Defendant cannot be permitted to plead pay- 
 ment of the bond, as that would amount to the same thing. 
 
 BuLLER, J. The Court proceeds on the ground, that the Defendant 
 has in effect agreed not to plead payment against the nominal obligee. 
 
 Upon this the Defendant consented to go before the prothonotary.* 
 
 WELCH V. MANDEVILLE. 
 (Supreme Court of the United States, 1816. 1 Wheat. 233, 4 L. Ed. 79.) 
 
 Error to the Circuit Court for the District of Columbia for Alexan- 
 dria County. This was an action of covenant brought in the name of 
 Welch (for the use of Prior) against Mandeville and Jamieson. The 
 suit abated as to Jamieson by a return of no inhabitant. The defend- 
 ant, Mandeville, filed two pleas. The second plea, upon which the 
 question in this Court arises, states, that, on July 5th, 1806, James 
 Welch impleaded Mandeville and Jamieson, in the Circuit Court of the 
 District of Columbia, for* the county of Alexandria, in an action of 
 covenant, in which suit such proceedings were had, that, afterward, to 
 wit, at a session of the Circuit Court, on December 31st, 1807, "the 
 said James Welch came into Court and acknowledged that he would 
 
 » If the assignor's release to his debtor is effective, because the debtor had 
 no notice of the assignment or for other reason, the assignee has an action 
 against the assignor. Franklin Fire Ins. Co. of Philadelphia v. Weinberg, 
 108 Misc. Kep. 500, 178 N. T. Supp. 539 (1019) ; People ex rel. Stanton v. 
 Tioga Common Pleas, 19 Wend. (N. Y.) 73 (1837), semble. The law recog- 
 nized this right against the assignor even before it acknowledged that the 
 assignee had a right against the debtor. Deering v. Farrington, 1 Mod. 113, 
 3 Keb. 2 (1674) ; Caister vj Eccles, 1 Ld. Eaym. 683, Salk. 68 (1702). 
 
Ch. 7) ASSIGNMENT 1123 
 
 not farther prosecute his sai4 suit, and from Ishence altogether with- 
 draw himself." The plea then avers, that the said James Welch, in the 
 plea rnentioned, is the same person in whose name the present suit is 
 brought, and that the said Mandeville and Jamieson, in the former suit, 
 are the same persons whq are defendants in this suit, and that the 
 cause of action is the same in both suits. To this plea the plaintiff 
 filed a special replication, protesting thajt the said James Welch did 
 not come into Court and acknowledge that he would not farther prose- 
 cute the said suit and from thence altogether withdraw, himself ; and 
 avers that James Welch, being indebted to Prior, in more than $8,707.- 
 09, and Mandeville and Jamieson being indebted, by virtue of the cove- 
 nant in the declaration mentioned, in $8,707.09, to Welch, he, Welch, on 
 September 7th, 1799, by an equitable assignment, assigned to Prior, for 
 a full and valuable consideration, the said $8,707.09, in discharge of 
 the said debt, of which assignment the replication avers Mandeville and 
 Jamieson had notice. The replication further avers, that the suit in 
 the plea mentioned was brought in the name of Welch, as the nominal 
 plaintiff for the use of Prior, and that the defendant, Mandeville, knew 
 that the said suit was brought, and was depending for the use and bene- 
 fit of the said Prior ; and that the said suit in the plea mentioned, with- 
 out the authority, consent, or knowledge of the said Prior, or of the 
 attorney prosecuting the said suit, and without any previous applica- 
 tion to the court, was "dismissed, agreed." The replication farther 
 avers, that the said James Welch was not authorized by the said Prior 
 to agree or dismiss the said suit in 'the plea mentioned ; and that the 
 said Joseph Mandeville, with whom the supposed, agreement for the 
 dismissal of the said suit was made, knew, at the time of making the 
 said supposed agreement, that the said James Welch had no au- 
 thority from Prior to agree or dismiss said suit. The replication 
 farther avers, that the said agreement and dismissal of the said suit 
 were made and procured by the said Joseph Mandeville, with the in- 
 tent to injure and defraud the said Prior, and deprive him of the 
 benefit of the said suit in the plea mentioned. The replication also 
 avers, that the said Prior did not know that the said suit was dismissed 
 until after the adjournment of the Court at which it was dismissed; 
 and, farther, that the supposed entry upon the record of the Court in 
 said suit, that the plaintiff voluntarily came into Court and acknowledg- 
 ed that he would not further prosecute his said suit, and from thence 
 altogether withdraw himself, and the judgment thereupon was made 
 and entered by covin, collusion, and fraud; and that the said judgment 
 was, and is, fraudulent. To this replication the defendant filed a gen- 
 eral demurrer, and the replication was overruled. It appeared by the 
 record of the suit referred to in the plea, that the entry is made in 
 these words : "This suit is dismissed, agreed,"- and that this entry was 
 made by the clerk without the order of the Court, and that there is 
 no judgment of dismissal rendered by the court, but only a judgment 
 refusing to reinstate the cause. 
 
1124 ASSIGNMENT CCh. 7 
 
 Story, J., delivered the opinion of the Court. 
 
 The question upon these pleadings comes to this, whether a nominal 
 plaintiff, suing for the benefit of his assignee, can, by a dismissal of the 
 suit under a collusive agreement with the defendant, create a valid 
 bar against any subsequent suit for the same cause of action. 
 
 Courts of law, following in this respect the rules of equity, now 
 take notice of assignments of choses in action, and exert themselves 
 to afford them every support and protection not inconsistent with the 
 established principles and modes of proceeding which govern tribunals 
 acting according to the course of the common law. They will not, 
 therefore, give effect to a release procured by the defendant under a 
 covinous combination with the assignor in fraud of his assignee, nor 
 permit the assignor injuriously to interfere with the conduct of any 
 suit commenced by his assignee to enforce the rights which passed 
 under the assignment. The dismissal of the former suit, stated in the 
 pleadings in the present case, was certainly not a retraxit ; and if it had 
 been, it would not have availed the parties, since it was procured by 
 fraud. Admitting a dismissal of a suit, by agreement, to be a good 
 bar to a subsequent suit (on which we give no opinion), it can be so 
 only when it is bona fide, and not for the purpose of defeating the rights 
 of third persons. It would be strange, indeed, if parties could be al- 
 lowed, under the protection of its forms, to defeat the whole objects 
 and purposes of the law itself. 
 
 It is the unanimous opinion of the Court, that the judgment of the 
 Circuit Court, overruling the replication to the second plea of the 
 defendant, is erroneous, and the same is reversed, and the cause re- 
 manded for further proceedings. 
 
 Judgment reversed.^" 
 
 1" After notice of the assignment, given to the debtor, the assignor has no 
 power to discharge the debtor, either by a release, or by receiving payment, 
 or by accord and satisfaction : Carrington v. Harway, 1 Keb. 803 (1676) ; 
 McCullum V. Lioxe, 1 Dall. (Pa.) 139, 1 L. Ed. 72 (1785) ; Andrews v. 
 Beecker, 1 Johns. Cas. (N. Y.) 411 (1800) ; Wardell v. Eden, 2 Johns. Gas. 
 (N. X.) 258 (1801) ; Littlefield v. Storey, 3 Johns. (N. Y.) 425 (1808) ; 
 Hackett v. Martin, 8 Greenl. (Me.) 77 (1831) ; Colbourn v. Eossiter, 2 Conn. 
 503 (1818) ; Jones v. "Witter, 13 Mass. S04 (1816) ; Duncklee v, Greenfield S. 
 M. Co., 23 N. H. 245 (1851) ; Jenkins v. Brewster, 14 Mass. 291 (1817) ; 
 Dawson v. Coles, 16 Johns. (N. Y.) 51 (1819), a judgment in favor of the as- 
 signor does not discharge the assignee's claim by merger; Briggs v. Dorr, 19 
 Johns. (N. Y.) 95 (1821), release by assignor invalid; Meld v. Mayor, etc., 
 of City of New York, 6 N. Y. 179, 57 Am. Dec. 435 (1852), debtor not discharg- 
 ed by payment after notice; Brice v. Bannister, 3 Q. B. D. 569 (1878), same; 
 Swan V. Maritime Ins. Co., [1907] 1 K. B. 116 ; St. Johns v. Charles, 105 Mass. 
 262 (1870), payment in advance of the time when payment was due. 
 
 See Cook, "The Alienability of Choses in Action," 29 Harv. Law Rev. 816 ; 
 Y. B. 22 Lib. Ass. pi. 91. 
 
 Payment to the assignor by the debtor extinguishes the debt, if the debtor 
 had no notice of the assignment. Such was also the rule of the Roman law. 
 Dig. II, 15, 17. 
 
Ch. 7) ASSIGNMENT 1125 
 
 CARTER & MOORE v. UNITED INS. CO. of NEW YORK. 
 (Court of Chancery of New York, 1815. % Johns. Oh. 463.) 
 
 The bill was filed by the plaintiffs, as assignees of a policy of in- 
 surance, underwritten by the defendants, for William Titus and 
 George Gibbs, on which the plaintiffs claimed payment for a total 
 loss. The insurance was on 500 barrels of flour from Newport to 
 St. Jago de Cuba, on board the Spanish brig Patriota, which was 
 captured by a Carthagena privateer. On the 21st of December, 
 1814, the policy was assigned by Titus & Gibbs to the plaintiffs, in 
 trust, for themselves and other creditors of Titus & Gibbs. The bill 
 charged that the defendants refused to pay the loss, alleging, among 
 other things, that the plaintiffs had no title to the property insured, 
 which, in fact, belonged to one J., a Spaniard, and not to Titus & 
 Gibbs. The bill 'prayed that the defendants might answer the mat- 
 ter charged in tlie bill, and be compelled to pay the plaintiffs the 
 amount insured as for a total loss. 
 
 To this bill the defendants demurred on the following grounds: 
 that it appeared by the bill that the plaintiffs' demand, or cause of 
 action, was properly cognizable in a Court of Law; as it is not al- 
 leged that Titus & Gibbs refused to let the plaintiffs make use ol 
 their names, in a suit at law ; or that they are, in any way, hindered 
 from prosecuting at law; or that they stood in need of any dis- 
 covery to aid them in such action. 
 
 The ChancEI/I/OR [Kent] . The demand is properly cognizable at 
 law, and there is no good reason for coming into this Court to re- 
 cover on the contract of insurance. The plaintiffs are entitled to 
 make use of the names of Gibbs & Titus, the original assured, in the 
 suit at law; and the nominal plaintiffs would not be permitted to 
 defeat or prejudice the right of action. It may be said here, as 
 was said by the chancellor, in the analogous case of Dhegetoft v. 
 The London Assurance Company, Mosely, 83, that, at this rate, all 
 policies o'f insurance would be tried in this Court. In that case the 
 policy stood in the name of a nominal trustee; but that was not 
 deemed sufficient to change the jurisdiction; and the demurrer to 
 the bill was allowed, and the decree was afterwards affirmed in 
 parUament. 3 Bro. P. C. 525. The bill, in this case, states no spe- 
 cial ground for equitable relief; nor is any discovery sought which 
 requires an answer. 
 
 Bill dismissed, with costs.^^ 
 
 "In accord • Dhegetoft v. I/Ondon Assur. Co. Mosely, 83, aflBrmed 4 Bro. P. 
 C. 436 (1730) ; Cator v. Burke, 1 Bro. Ch. 434 (1785) ; Hammond v. Messen- 
 ger 9 Sim 327 (1838) ; Ontario Bank v. Mumford, 2 Barb. Ch. (N. Y.) 596, 
 615 (1848) ; Walker v. Brooks, 125 Mass. 241 (1878) ; Hayward v. Andrews, 
 106 U. S. 672, 1 Sup. Ct. 544, 27 L. Ed. 271 (1882) ; New York Guar & T. Co. 
 V. Memphis Water Co., 107 V. S. 205, 2 Sup. Ct. 279, 27 L. Ed. 484 (1882) ; 
 Booth V. Warner (1797), reported in Coleman v. Wolcott, 4 Day (Conn.) b, 
 18 (1809). 
 
1126 ASSIGNMENT (Ch. 7 
 
 WHITING V. GLASS. 
 (Court of Appeals of New York, 1916. 217 N: Y. 333, 111 N. E. 1082.) 
 
 Action by Myron W. Whiting against AUie J. Glass. From a 
 judgment of the Appellate Division (160 App. Div. 915, 145 N. Y. 
 Supp. 1149), unanimously affirming a judgment (81 Misc. Rep. 402, 
 142 N. Y. Supp. 512), entered upon a verdict directed by the court in 
 favor of plaintii?, defendant appeals. Reversed, and judgment grant- 
 ed, dismissixig the complaint. 
 
 HiscocK, J.^^ This action was brought to recover the value of vari- 
 ous articles of personal property claimed to have been sold and de- 
 livered by respondent to appellant. The sale originated in a verbal 
 contract for the exchange of this property owned by the former for 
 a farm owned by the latter and which contract it is alleged the ap- 
 pellant was unable or unwilling to complete, although he had received 
 respondent's property. 
 
 It is unnecessary to consider all the various objections urged by 
 appellant's counsel to the recovery which has been directed in the 
 action, for in our opinion there was developed on the trial one very 
 simple and effective bar to the right to recover. This was the cir- 
 cumstance that prior to the commencement of the action respondent 
 had transferred to a third party his title to any claim which he held. 
 He executed an instrument which in its substantial features, so far 
 as concerns the present question, was a general assignment and which 
 specifically covered and included any claim which he had against 
 the appellant springing out of the transaction referred to, and such 
 transfer defeated his right to bring this action. Foster v. Central 
 Nat. Bank of Boston, 183 N. Y. 379, 76 N. E. 338. 
 
 It is urged by the respondent that after the transfer the assignee 
 was the trustee of an express trust and both by law and by express 
 provision of the assignment was authorized to bring an action in the 
 name of the assignor. Without considering this proposition broad- 
 ly, it is sufficient to say that there is nothing to indicate that the 
 Assignee had anything whatever to do with bringing the action or 
 that it was anything other than an action brought by an assignor 
 after he had fully and completely transferred to another the title 
 to the cause of action. * * * 
 
 Under the circumstances, instead of directing a verdict for the 
 respondent the trial court should have directed a nonsuit for the ap- 
 pellant, and inasmuch as th? facts which bar the former's right of 
 recovery cannot be changed on a new trial, not only should the 
 judgment appealed from be reversed, but judgment should be granted 
 dismissing the complaint, with costs to the appellant in all courts.^' 
 
 12 A small part of the opinion is omitted. 
 
 13 In accord: Looney v. District of Columbia, 113 TJ. S. 258, 5 Sup. Ct. 468. 
 28 L. Ed. 974 (1885). 
 
 Where the assignment is merely as security for the payment of a previous 
 
Ch. 7) ASSIGNMENT 
 
 1127 
 
 CROUCH V. MARTIN & HARRIS et al. 
 (In Chancery, 1707. 2 Vern. 595.) 
 
 ^iS"^ P^^i"*'^ '^"* ^'■*^^"'' ^^'■"'' ^^^^ husband of the defendant, 
 ilUO on Bottom-Rhea; and as a farther security assigned to the 
 plaintiff the wages that would become due to him in the voyage to 
 the Indies, as chirurgeon of the ship at £4.10s. per month; the ship 
 returned safe to London, and £145 became due on the Bottom-Rhea 
 bond. Arthur Harris died in the voyage; the defendant, his widow, 
 took out administration ; and there being a bond given by her hus- 
 band on her marriage to leave her £400 if she survived him, she con- 
 fessed judgment thereon, and insisted that judgment ought to be 
 first paid, and the wages due to the husband applied to that purpose. 
 
 Per Curiam. Seamen's wages are assignable, and the assignment 
 specifically binds the wages ; and in truth the advancing the £100 on 
 the credit of the wages is, as it were, paying the wages beforehand ; 
 and the seaman or his widow must not have his wages twice. 
 
 It is a chose en action, being due by contract, although the service 
 not then done," and a chose en action is assignable in equity upon 
 a consideration paid. 
 
 TAYLOR v. BARTON-CHILD CO. 
 (Supreme Judicial Court of Massachusetts, 1917. 228 Mass. 126, 117 N. E. 43.) 
 
 Suit by Violet I. Taylor against the Barton-Child Company, defend- 
 ed by Forest F. Collier, trustee in bankruptcy of defendant. Reserv- 
 ed for determination of full court upon bill of complaint, amended an- 
 swer, replication, and master's report. Bill dismissed, without costs. 
 
 RuGG, C. J. This is a suit in equity to enforce rights of the plain- 
 tiff under an assignment of book accounts made to her assignor by 
 the defendant corporation as security for a loan. It is undisputed that 
 on December 3, 1910, one McCarthy, who is the assignor of the plain- 
 debt due to the assignee, the assignor still has an interest, and suit can be 
 maintained in his name. Beach t. Fairbanks, 52 Conn. 167 (1884) ; New 
 Haven Trust Co. v. Fitzpatrick, 74 Conn. 317, 50 Atl. 725 (1901). Although a 
 statute provides that the assignee may sue in his own name, a suit by such 
 assignee in the name of the assignor will be sustained. Lowndes v. City Mat. 
 Bank, 79 Conn. 693, 66 Atl. 514 (1907) ; Michigan Sugar Co. v. Moffett, 183 
 Mich. 589, 149 N. W. 1025 (1914). 
 
 1* Where there is an existing employment, the right to wages or earnings to 
 become due in the future is assignable, even as against the assignor's subse- 
 quent creditors ; and this is so even though the employment is for an indefinite 
 term and is subject to termination at the will of either party. Rodijkeit v. 
 Andrews, 74 Ohio St. 104, 77 N. E. 747, 5 L. R. A. (N. S.) 564, 6 Ann. Cas. 761 
 (1906) ; Duluth, S. S. & A. R. Co. v. Wilson, 200 Mich. 313, 167 N. W. 55, L. 
 R. A. 1918B, 763 (1918) ; Field v. Mayor, etc., of City of New York, 6 N. T. 
 179, 57 Am. Rep. 435 (1852) ; Manly v. Bitzer, 91 Ky. 596, 16 S. W. 464, 34 ' 
 Am. St. Rep. 242 (1891) ; Hawley v. Bristol, 39 Conn. 26 (1872) ; Augur v. 
 New York Belting & Packing Co., 39 Conn. 536 (1873). 
 
1128 ASSIGNMENT (Ch. 7 
 
 tiff, lent to the defendant $5,000 and received its seven notes with dif- 
 ferent due dates, the most remote being June 3, 1913. As security for 
 and in consideration of the loan, on the same day the defendant exe- 
 cuted and delivered to the plaintiff's assignor an instrument which, it 
 is contended, was an assignment of its present and future book ac 
 counts. Some of the notes were extended, some have been paid and a 
 balance remains unpaid. This bill was filed on February 2, 1914. An 
 injunction respecting the book accounts was issued on February 13, 
 1914. The defendant was adjudicated a bankrupt on February 13, 
 1914. Its trustee in bankruptc)' is defending this cause. 
 
 At the time of the loan the defendant was engaged iii dealing at 
 wholesale in butter, eggs and similar products and needed the money 
 borrowed of tlie plaintiff's assignor for carrying on its business, and 
 used it for that purpose. The book accounts at the time of the assign- 
 ment were between $25,000 and $30,000, some of which were due, but 
 the greater part of them would become due within the next 60 days. 
 
 The crucial question is whether the assignment of book accounts, 
 which are to come into existence in the future in connection with an 
 established business, will be enforced in equity against a trustee in 
 bankruptcy. 
 
 It is a well recognized principle of the common law that a man can- 
 not sell or mortgage property which he does not possess and to which 
 he has no title. The vendor must have a vested right in personal prop- 
 erty in order to be able to make a sale of it. "A man cannot grant or 
 charge that which he hath not." Jones v. Richai-dson, 10 Mete. 481, 
 4S8; Moody v. Wright, 13 Mete. 17, 46 Am. Dec. 706; Leverett v. 
 Barnwell, 2i4 Mass. 105, 109, 101 N. E. 75. 
 
 The ground of our decisions may be stated shortly. There can be 
 no present conveyance or transfer of property not in existence, or of 
 ■property not in the possession of the seller to which he has no title. 
 A sale of personal chattels is not good against creditors unless there 
 has been a delivery. Manifestly there can be no delivery of chattels 
 not in existence. In order that after-acquired chattels may be brought 
 under the lien of a mortgage, or of hypothecation, there must be some 
 act of the parties subsequent to the time when such chattels come into 
 existence and into the ownership and possession of the mortgagor. 
 The mortgage is held not to have the effect of changing the title to 
 after-acquired chattels without some further act af the parties. 
 
 There is an exception at the common law to the effect that one may 
 sell that in which he has a potential title although not present actual 
 possession, fhe present owner might sell the wool to be grown upon 
 his flock, the crop to be harvested from his field or the young to be 
 born of his herd, or assign the wages to be earned under existing em- 
 ployment. Kerr v. Crane, 212 Mass. 224, 229, 98 N. E. 783, 40 L. R. 
 A. (N. S.) 692; St. Johns v. Charles, 105 Mass. 262; Farrar v. Smith, 
 64 Me. 74, 77; McCarty v. Blevins, 5 Yerg. (Tenn.) 195, 26 Am. Dec. 
 262; Dugas v. Lawrence, 19 Qa. 557. But see now Sales Act, St. 
 
"Ch. 7) ASSIGNMENT 1129 
 
 1908, c. 237, § 5 (3). That principle of the common law has never 
 been carried so far as to include the case at, bar. The catch of fish ex- 
 pected to be made upon a voyage about to begin cannot be sold. L,ow 
 V. Pew, 108 Mass. 347, 11 Am. Dec. 357. There can be no sale of the 
 wool of slieep, the crop of a field, or the increase of herds not owned 
 but to be bought, and there can be no assignment of wages to be earn- 
 ed under a contract of employment to be made in the future. Eagan 
 V. Luby, 133 Mass. 543 ; Citizens' Loan & Trust Co. v. Boston & 
 Maine R. R., 196 Mass. 528, 531, 82 N. E. 696, 14 L. R. A. (N. S.) 
 1025, 124 Am. St. Rep. 584, 13 Ann. Cas. 365. 
 
 It is also the established doctrine in this commonwealth that a mort- 
 gage of future acquired property will not be enforced in equity be- 
 fore actual possession taken by the mortgagee as against persons sub- 
 sequently acquiring an interest therein for value and having posses- 
 sion. That has long been settled although the contrary rule prevails 
 more widely. Federal Trust Co. v. Bristol County St. Ry. Co., 222 
 Mass. 35, 45, 46, 109 N. E. 880, where cases are collected. It would 
 be anomalous for a court governed by these principles as to sales and 
 mortgages of future acquired goods and chattels to hold that there 
 could be an assignment of future .acquired book accounts valid and 
 enforceable under circumstances where a like attempt to hypothecate 
 future acquired chattels would be held unenforceable. 
 
 A book account is a chose in action. It is "a right not reduced into 
 possession" which "can only be reduced into beneficial possession by 
 an action or suit." Haskell v. Blair, 3 Cush. 534, 535. It is property. 
 While some of its incidents differ from those of a tangible thing, 
 these are not sufficient to warrant the application to it of principles of 
 law different in the respect here involved from those governing trans- 
 actions concerning property with a physical and tactile body. Where 
 it is reasonably practicable, it is desirable in the development of an 
 harmonious system of jurisprudence that the same general rules of 
 law should be applicable to the same classes of facts and that excep- 
 tions having their foundation more upon appearances than upon dif- 
 ferences of substance should not be multiplied. 
 
 Practical difficulties of no small consequence would be encountered 
 in the operation of the contrary doctrine. Assignments of book ac- 
 counts do not require recording or any public act for their validity. 
 Marsh v. Woodbury, 1 Mete. 436; Gilligan Co. v. Casey, 205 Mass. 
 26, 91 N. E. 124. Notice need not be given in order that they be valid 
 against third persons. Thayer v. Daniels, 113 Mass. 129; Cropper v. 
 Gorham, 221 Mass. 119, 125, 109 N. E. 161. Merchants and manufac- 
 turers well might acquire a considerable credit upon the supposed 
 strength of book accounts which later might turn out to have been as- 
 signed long before they came into existence. A door would be opened 
 for the accomplishment of fraud in business. 
 
 There are decisions by the courts of other jurisdictions where a con- 
 trary result has been reached. Union Trust Co. v. Bulkeley, 150 Eed. 
 
1130 ASSIGNMENT (Ch. 7 
 
 510, 80 C. C. A. 328; In re Macauley (D. C.) 158 Fed. 322; Tailby 
 V. Official Receiver, 13 App. Cases, 523.^" These decisions follow nat- 
 urally from Holroyd v. Marshall, 10 H. L. C. 191, Central Trust Co. 
 V. Kneeland, 138 U. S. 414, 419, 11 Sup. Ct. 357, 34 L. Ed. 1014, and 
 other cases holding that mortgages of future acquired personal proper- 
 ty are enforceable in equity. But as has been pointed out, that is not 
 the law of this commonwealth. 
 
 The principles and spirit of our jurisprudence have been that owners 
 of personal property ought not to acquire any false credit by creating 
 incumbrances more or less secret and uni<nown to the world upon 
 property of which they are to come into .possession in the future as 
 ostensible owners in absolute right. Blanchard v. Cooke, 144 Mass. 
 207, 223, 227, 11 N. E. 83; Wasserman v. McDonnell, 190 Mass. 326, 
 76 N. E. 959; Schlatter v. Young, 197 Mass. 36, 38, 83 N. E. 2; 
 Chick V. Nute, 176 Mass. 57, 57 N. E. 219; Wilson v. Russell, 136 
 Mass. 211; Harriman v. Woburn Elec. Light Co., 163 Mass. 85, 
 39 N. E. 1004. It was held in Hall v. Jackson, 20 Pick. 194, that 
 an irrevocable power of attorney to bankers to collect debts due 
 to a manufacturer from his customers, as security for advances 
 made by the bankers, did not constitute a lien superior to an attach- 
 ment by trustee process, in the absence of possession, control or dis- 
 posing power in the person claiming the Uen over the subject matter 
 in which the lien was claimed. See, also, Elmore v. Symonds, 183 
 Mass. 321, 67 N. E. 314. In the light of these decisions it would be 
 illogical and discordant with the policy of our law to uphold the as- 
 signment in the case at bar. It was held in Purcell v. Mather, 35 Ala. 
 570, 76 Am. Dec. 307, Skipper v. Stokes, 42 Ala. 255, 94 Am. Dec. 
 646, and Clanton Bank v. Robinson, 195 Ala. 194, 70 South. 270, that 
 assignments similar to those here in question were invalid. 
 
 In accordance with the terms of the reservation let the entry be: 
 
 Bill dismissed without costs.^° 
 
 RICHARDSON v. MEAD. 
 (Supreme Court of New York,. 1858. 27 Barb. 178.) 
 
 This action was brought in a court held by a justice of the peace, 
 where the plaintiff recovered a judgment against the defendant for 
 $35.38 damages, besides costs. The cause of action was a claim in 
 favor of Philo Wetherby against the defendant, for work of the 
 
 15 Such an assignment has been held valid as between assignor and assignee. 
 Field V. Mayor, etc., of City of New York, 6 N. Y. 179, 57 Am. Dec. 435 (1552) . 
 
 18 In accord: Herbert v. Bronson, 125 Mass. 475 (1878) ; Draeger v. Wis- 
 consin Steel Co.,' 194 111. App. 440 (1915) ; McKneely v. Armstrong (Tex. Civ. 
 App.) 212 S. W. 175 (1919) ; Eaulines v. Levi, 232 Mass. 42, 121 N. E. 500 
 (1919) ; O'Keefe v. Allen, 20 R. I. 414, 89 Atl. 752, 78 Am.~St. Rep. 884 a898). 
 
 See, also, annotation in L. R. A. 1918A, 124. 
 
Ch. 7) ASSIGNMENT 1131 
 
 former, which he had performed for the defendant: and which claim 
 the plaintiff alleged Wetherby had assigned to him. The claim, as pre- 
 sented to the justice, was in the form of an account; and on the back 
 thereof, was an assignment of it to the plaintiff in these words and 
 figures, to wit : 
 
 "Oct. 13, 1856. This day, at 8 o'clock in the morning, I sell and 
 transfer this account to William Richardson against David Mead. 
 
 "[Signed] Philo Wetherby. 
 . "Witness, Austin Richardson." 
 
 The defendant objected to the sufficiency of the assignment of the 
 claim for the work, on the ground that there was no consideration 
 expressed in it. The justice overruled the objection; and upon the 
 evidence in the case showing that Wetherby performed the work for 
 the defendant, mentioned in the account, rendered the above men- 
 tioned judgment. Philo Wetherby was examined, as a witness for 
 the plaintiff, to prove that he did the work specified in the account, 
 and to establish the price that the defendant agreed to pay him there- 
 for. But he was not questioned as to whether there was any consid- 
 eration for the assignment of the account by him to the plaintiff. 
 Whether the plaintiff had title to the claim in dispute, so that he could 
 recover on it, was the only material question for the consideration 
 of the court, in the case. The Otsego county court held that the as- 
 signment of the account, by Wetherby to the plaintiff, was void, for 
 the "reason that it was without consideration; and reversed the judg- 
 ment of the justice. The plaintiff appealed from the judgment of the 
 county court to this court. 
 
 BalCom, J. If the defendant had paid to the plaintiff the claim 
 for Wetherby 's work, without suit, the latter could not have recov- 
 ered it again, of the defendant, upon proof that the assignment of it 
 to the plaintiff was without consideration. The assignment establishes 
 the fact that Wetherby desired the defendant should pay the plaintiff 
 for the work; and if he had paid the claim therefor, the law would 
 declare that he had done so at Wetherby's request. 
 
 There can be no doubt, if Wetherby had only promised the plain- 
 tiff that he would transfer the claim to him, that the plaintiff would 
 have been obliged to aver and prove a consideration for the promise, 
 in order to recover, in an action against Wetherby for a refusal to 
 transfer it. See Barnes v. Ferine, 15 Barb. 249. But the transfer 
 of the claim was executed. Wetherby had done all that he had agreed 
 to do with it ; and the plaintiff was in possession of a statement of it, 
 and of evidence that he received it lawfully. And where a contract 
 has been executed, it is not always necessary for a party, who claims 
 the benefit of it, to show that there was a consideration for it. Robert- 
 son V. Gardner, 11 Pick. (Mass.) 146. 
 
 It is never necessary for the assignee of a thing m action or con- 
 tract to prove that he paid or agreed to pay a consideration for it, to 
 
1132 ASSIGNMENT (Ch. 7 
 
 entitle him to maintain an action thereon, in his own name, if he shows 
 that he holds it, and is the real party in interest. Code, § 111. A 
 gratuitous assignment, if good on its face, is sufficient; for it passe,s 
 the title, as between the parties. Arthur v. Brooks, 14 Barb. 533.^' 
 
 Now the real question in this case is whether it was necessary for 
 the plaintiff to prove that he paid a consideratibn for the claim, for 
 Wetherby's work. He clearly might have done this, if there was any 
 consideration for the assignment, notwithstanding its language. 
 Barnes v. Ferine, supra. The assignment states that Wetherby sold 
 and transferred the claim to the plaintiff, at 8 o'clock in the morning of 
 the 13th day of October, 1856 ; and I think we should not presume 
 that he gave the , claim to the plaintiff, or that the assignment was 
 without consideration ; but rather that Wetherby sold it to the plaintiff 
 for a valuable consideration, paid or agreed, to be paid therefor. See 
 2 Cowen's Tr. 47 (2d Ed.). 
 
 I am of the opinion the assignment of the claim by Wetherby to the 
 plaintiff, in the form it was, estabhshed . the fact .that the plaintiff 
 owned the claim; and that he was entitled to recover. 
 
 There being no other question in the case, worthy of notice, I think 
 the judgment of the county court should be reversed, and .that of the - 
 justice affirmed, with costs. 
 
 Decision accordingly. 
 
 CRONIN V. CHELSEA SAVINGS BANK et al. 
 (Supreme Judicial Court of Massachusetts, 1909. 201 Mass. 146, 87 N. E. 484.) 
 
 Action by James P. Cronin against the Chelsea Savings Bank ; Jere- 
 miah Cronin, administrator, being adrtiitted as claimant. From a 
 verdict for defendaht, plaintiff brings exceptions. Exceptions sus- 
 tained. 
 
 " In accord: Coe v. Hinkley, 109 Mich. 608, 67 N; W. 915 (1896) ; Duryea 
 V. Harvey, 183 Mass. 429, 67 N. E. 351 i(1903) ; Phipps v,. Bacon, 183 Mass. 5, 
 66 N. E. 414 (1903) ; MapKeown v. Lacey, 200 Miass. 437, 86 N. E. 799, 21 h. 
 JR. A. (N. S.) 683,' 16 Aim. Cas. 220 (1909) ; Allen v. Brown, 44 N. Y. 228, 
 (1870), affirming 51 Barb. 86 (1870) ; Buxton v. Barrett, 14 R. I. 40 (1882) ; 
 Welch V. Mayer, 4 Colo. App. 440, 36 Pac. 613 (1894) ; Moore v. Waddle, 34 Cal. 
 145 (1868) ; Morrison v. Ross, 113 Ind. 186, 14 N. E. 479 (1887) ; Pugh v. 
 Miller, 126 Ind. 189, 25 N. E. 1040 (1890) ; Wardner, Bushnell & Glessner Co. 
 V. Jack, 82 Iowa, 435, 48 N. W. 729 (1891) ; Walker v. Bradford Old Bank, 
 12 Q. B. D. 5U (1884) ; Brandts v. Dunlop, [1905] A. C. 454, 462; In re 
 Westertoh, [1919] 2 Ch. 104; Schetfer v. Erie County Savings Bank, 229 N. 
 Y. 50, 127 N: E. 474 (1920) , gift of savings bank book. . See articles by Jenks, 
 Anson, and Costigan in 16 L. Q. R. 241, 17 L. Q. R. 90, 27 L. Q. R. 326. See, 
 also, Walker v. Rostron, 9 M. & W. 411 (184?) ; Griffin v. Weatherby, h. 
 R. 3 Q. B. 753 (1^68) ; Lord Carteret v. Paschal, 3 P. Wms. 197, 199 (1733). 
 
 When the gift is executed by delivery, it is irrevocable; and if the donor 
 of a savings account retakes the bank book by force and collects from the 
 hank, the assignee, can recover from the assignor in an action for inoney had 
 and receivfed.' 'Brown v.- Brown, 40 Hun (N. T.) 418 (1886)* 
 
Ch. 7) ASSIGNMENT . 1133 
 
 Morton, J. This is an action of contract brought by the plaintiff 
 to recover of the defendant bank the proceeds of a draft drawn on 
 the National Bank, Limited, of Cahirciveen, Ireland, in favpr, of one 
 Ellen Sullivan, now deceased. The draft was deposited by the said El- 
 len Sullivan with the defendant bank for collection on April 3, 1906, 
 and the bank gave her the following receipt: "Chelsea, Mass., April 3, 
 1906. Received from Ellen Sullivan for collection draft #21,615 for 
 £199 by Natl. Bank, Limited, of Cahirciveen, Ireland. Dated Oct. 24, 
 1904. Chelsea Savings Bank, per R." The said Ellen Stillivan died 
 a few days later on April 8th. On April 6th she was informed by the 
 doctors and by the clergyman who attended her that her end was ap- 
 proaching. The last rites of the church were administered to her 
 about 4 o'clock and about 7 o'clock she called the plaintiff to her and 
 discussed with him the place where she wished to be buried and other 
 matters relating to the burial. She told him that she wished him to 
 have the money and handed the receipt to him, saying, "You better take 
 this check," and he said, "All fight." She told him to pay for hei" 
 burial and a headstone and her bills and to keep the rest for himself. 
 The plaintiff then said to her, "Aunt Nell, this [meaning the receipt] is 
 no use to me unless you make it payable to me." Thereupon she in- 
 
 dorsed it as follows: "Pay this to' James P. Cronin. Ellen X Sullivan. 
 
 mark 
 
 Witness to mark: Minnie A. Cronin" — and delivered it to him. She 
 came to this country in November, 1904, and, with the exception of 
 the week following her arrival, lived with the plaintiff till her death 
 and was buried from his house in accordance with the instructions 
 which she had given him. She died on Sunday and before her death 
 told the visiting clergyman that she had given her money to the plain- 
 tiff. 
 
 Demand was duly made by the plaintiff on the defendant bank for 
 the proceeds of the draft after the same had been collected by it and it 
 refused to pay over the same to the plaintiff. Thereupon this action 
 was brought. The administrator was admitted as a claimant and at the 
 close of the plaintiff's evidence the presiding justice ruled that the 
 plaintiff was not entitled to the money and ordered a verdict for the 
 defendant. The case is here on exceptions by the plaintiff to this rul- 
 ing and direction. 
 
 We think that there was evidence warranting a finding of a donatio 
 causa mortis, and that the case should have been submitted to the 
 jury. There can be no doubt, we think, that if there was evidence war- 
 ranting the finding of a valid delivery all of the other things necessary 
 to constitute a donatio causa mortis could have been found to be pres- 
 . ent— expected and impending death, an intention to pass the title 
 then and there, and no revocation of the gift before death. \Ve thmk 
 that there was evidence, which if believed, warranted a findmg that 
 there was a sufficient delivery. The deceased did not have the draft 
 
1134 ■ ASSIGNMENT (Ch. 7 
 
 itself, and she could not, therefore, deliver that. The only voucher 
 for and evidence of title to the draft and its proceeds which she had , 
 was the receipt which had been given to her by the savings bank. This 
 represented or at least could have been found to represent the draft 
 and its proceeds when collected, and to have been so intended by the' 
 parties, even though it did not contain the words "to be accounted for 
 when collected" or words of similar import. Not only was manual 
 possession of the receipt given to the plaintiff by the deceased but it 
 was assigned to him by an indorsement on the back for the purpose as 
 it could have been found of transferring to him the property which 
 it represented. Unless, therefore, the interest was one incapable of 
 delivery and consequently one which could not be made the subject of 
 a donatio causa mortis there would seem to have been ample evidence 
 of a donatio causa' mortis. We do not think that the interest was in- 
 capable of delivery any more than the interest represented by a de- 
 posit in a savings bank which a delivery of the book, without an as- 
 signment, if done with the intention to convey the title, is sufficient 
 to pass. Pierce v. Boston Five Cents Sav. Bank, 129 Mass. 425, 37 
 Am. Rep. 371. The delivery was the best possible one under the cir- 
 cumstances. The case is not one of a gift of the donor's own check. 
 The indorsement on the receipt was or could have been found to be 
 simply for the purpose of perfecting the' gift of the draft and its pro- 
 ceeds. . See, Moore v. Darton, 4 De G- & S. 517; In re Dillon [1890] 
 44 Ch. Div. 76. 
 
 Exceptions sustained.^* 
 
 , i8\Al savings bank account can be assigned as a gift by a delivery of the 
 deposit book (on presentation of which the money is payable), with or with- 
 out a written order. Pierce v. Five Cents Sav. Bank, 129 Mass. 425, 37 Am. 
 Rep. 371 (1880) ; Wade v. Smith, 218 Mass.' 34, 99 N'. E. 477 (1912) ; Harrl- 
 man v. Bunker, 79 N. H. 127, 106 Atl. 499 (1919) ; Allen v. Smith, 38 Cal. 
 App. 409, 176 Pac. 365 (1918) ; Wade v. Edwards, 23 6a. App. 677, 99 S. E. 
 160 (1919) ; Scheffer v. Erie County Savings Bank, 229 N. Y. 50, 127 N. E. 
 474 (1920). The same is true of a certificate of stock arid of a promissory 
 note. Herbert v. Simson, 220 Mass. 480, 108 N. B. 65, L. R. A. 1915D, 733 
 (1915), citing many cases as to stock; Grover v. Grpver, 24 Pick. 261, 35 Am. 
 Dec 319 (1837) ; State Bank of Crosswell v. Johnson, 151 Mich. 538, 115 
 N. W. 464 (1908), certificate of deposit. ■ 
 
 An actual delivery is necessary to effectuate the gift, whether the gift be 
 inter vivos or causa mortis. Duryea v. Harvey, 183 Mass. 429, 67 N. E. 351 
 (1903). 
 
 Where the owner of bonds has pledged them as security and holds the 
 pledgee's receipt for them, he can make a gift of the bonds by a delivery of 
 the receipt. Lipson v. Evans, 133 Md. 370, 105 Atl. 312 (1918). 
 
Ch. 7) ASSIGNMENT 1133 
 
 ADAMS V. MERCED STONE CO. 
 (Supreme- Court of CaUfornia, 1917. 176 Cal. 415, 178 Pac. 498.) 
 
 Suit by Edson F. Adams, as executor of the estate of Thomas 
 Prather, deceased, against the Merced Stone Company. From a 
 judgment for defendant and order denying new trial plaintiff ap- 
 peals. Reversed. 
 
 Shaw, J. The plaintiff appeals from a judgment in favor of the de- 
 fendant, and from an order denying his motion for a new trial. 
 
 The complaint states a cause of action against the defendant, in 
 favor of the decedent, Thomas Prather, upon an indebtedness alleged to 
 be the sum of $112,965.84. The defendant in its answer denied the 
 existence of any indebtedness from it to said Thomas Prather at the 
 time of his death, and on information and belief alleged that prior 
 to his death said Thomas Prather made a gift of said indebtedness, due 
 from the plaintiff to Thomas Prather, to one Samuel D. Prather, 
 and that said Samuel then became and ever since has been the owner of 
 said indebtedness. 
 
 The court found that during the last sickness of Thomas Prather, 
 to wit, on April 17, 1913, said Thomas Prather made a gift to his 
 brother Samuel D. Prather, of all of the indebtedness due from the, de- 
 fendant to said Thomas, being the indebtedness sued for by the plain- 
 tiff herein. That at that time Samuel was the president, the general 
 manager, and a member of the board of directors of the defendant, 
 said defendant being a corporation, and Thomas Prather knew that 
 Samuel held said offices and by reason thereof had full and exclusive 
 charge and control of defendant's books of account, including power 
 to make or direct the making of entries and transfers in said books, 
 and knew that by reason thereof Samuel D. Prather had the means 
 of obtaining possession and control of the said indebtedness so given 
 to him. The court further stated that by reason of the fact that 
 Thomas Prather had this knowledge at the time he gave the indebted- 
 ness to Samuel, he therefore at that time gave to said Samuel the 
 means of obtaining possession and control of the thing given, that is, 
 of the said indebtedness. This last statement is, of course, a mere 
 conclusion from the facts previously stated. The appellant contends 
 that the transaction as stated in the findings did not constitute a valid 
 gift of the indebtedness in question, and that the finding, so far as it 
 states the ultimate fact of such gift, is contrary to the evidence. 
 
 It is conceded that at the time of the asserted gift Thomas Prather 
 knew that Samuel D. Prather held the offices above mentioned, and 
 that it was within his official power by reason thereof to make sufficient 
 changes upon the books of account of the defendant to make them show 
 that the said indebtedness had been transferred by Thomas Prather 
 to Samuel D. Prather, and was owing by the defendant to Samuel D 
 Prather, instead of Thomas Prather. It is admitted that the asserted 
 
1136 ASSIGNMENT (Ch. 7 
 
 gift was made during the last sickness of Samuel Prather, two days 
 before his death, which event occurred on April 19, 1913, and was 
 therefore a gift in view of death. Civ. Code, § 1150. It is also ad- 
 mitted that no change was made upon the books of the defendant re- 
 garding said indebtedness, up to the time of the trial of this action, and 
 that when the action was begun the account books of the defendant 
 showed it to be indebted to the said Thomas Prather in the sum claim- 
 ed in the complaint. 
 
 The only evidence of the gift asserted in the answer is found in the 
 testimony of Samuel D. Prather, and is as follows : "In talking busi- 
 ness matters my brother said to me, 'Now, in reference to the account 
 of Thomas Prather in the Merced Stone Company, I want to give 
 you that account, all that is due me from that account. I don't 
 know just how to do this, but I give it to you.' * * * a little 
 further in the conversation my brother said to me, 'I give you the 
 keys to my office, the combination of my safe and keys to my desk, 
 and with these I give you all accounts, books, papers, letters, docu- 
 ments, furnishings, pictures, everything that belongs to me in that 
 office. It is yours.' " This he said occurred on April 17, 1.913. 
 
 The case depends upon the meaning and effect of section 1 147 of the 
 Civil Code which reads as follows : "A verbal gift is not valid, unless 
 the means of obtaining possession and control of the thing are given, 
 nor, if it is capable of delivery, unless theie is an actual or symbolical 
 delivery of the thing to the donee." 
 
 The contention of the respondent is that this section is complied 
 with in every case of gift of a chose in action where, at the time the 
 donor makes such gift, he knows that the donee has it within his 
 power to secure the possession and control of the thing given, and 
 that in such a case no delivery or transmission from the donor to the 
 donee of the means of obtaining possession and control of the subject 
 of the gift is necessary. We do not think this is the correct construc- 
 tion of the section quoted. It contemplates that the donor shall do 
 something at the time of making the gift which has the effect of placing 
 in the hands of the donee the means of obtaining the control and pos- 
 session of the thing given. That the fact that the thing was already 
 m possession of the donee at the time of declaring the gift is not 
 enough, is well settled by the authorities. Denigan v. Hibernian, etc.. 
 Society, 127 Cal. 141, 59 Pac. 389; Smith v. Zumbro, 41 W. Va. 
 623, 24 S. E. 653; Drew v. Hagerty, 81' Me. 231, 17 AtL 63, 3 L. 
 R. A. 230, 10 Ani. St. Rep. 255; Allen v. Allen, 75 Minn. 116, 77 N. 
 W. 567, 74 Am. St. Rep. 442. 
 
 In order to comply with the section the "means" must be "given." 
 In the connection in which these words occur the effect is that such 
 means must be given by the donor to the donee. This giving of the 
 means is authorized, where the thing given is not capable of delivery, as 
 a substitute fdr the actual or symbolical delivery of the thing by the 
 donor to the donee required in cases where such thing is capable of 
 
Ch. 7) ASSIGNMENT 1137 
 
 delivery. No good reason can be given for supposing that a transmis- 
 sion or delivery by the donor to the donee of the means was not intend- 
 ed to be as essential in the ease of intangible property, as the delivery, 
 actual or symbolical of the thing itself, where it is tangible. 
 
 In the case of a chose in actibn not evidenced by a written instru- 
 ment, the only means of obtaining control that is recognized by the 
 authorities is an assignment in writing, or some equivalent thereof. 
 
 "According to the weight of authority, in order to make a valid 
 gift inter vivos of a chose in action not evidenced by a written in- 
 strument, there must be a written assignment, or some equivalent in- 
 strument." 20 Cyc. 1202. 
 
 "A written assignment of the demand by the donor to the donee is 
 essential to complete the delivery" in the case of gifts causa mortis. 
 20 Cyc. 1237; 14 Am. & Eng. Ency. of Law, 1022. 
 
 "If the thing be not capable of actual delivery, there must be some 
 act equivalent to it. The donor must part not only with the posses- 
 sion, but with the dominion of the property. If the thing, given be 
 a chose in action, the law requires an assignment, or some equivalent 
 instrument, and the transfer must be actually executed." 2 Kent. 
 Com. *p. 439. 
 
 This passage from Kent was quoted and approved in DriscoU v. 
 Driscoll, 143 Gal; 534, 77 Pac. 471, and in Giselman v. Starr, 106 Cal. 
 657, 40 Pac. 8. 
 
 In Cook v. Lum, 55 N. J. Law, 373, 26 Atl. 803, the court said that 
 the test of an effectual gift was this : "That the. transfer was such that 
 in conjunction with the donative intention, it completely stripped the 
 donor of his dominion of the thing given, whether that thing was a 
 tangible chattel or a chose in action." 
 
 To the same effect was Ewing v. Ewing, 2 Leigh (Va.) 344; Shepard 
 V. Shepard, 164 Mich. 183, 129 N. W. 201 ; McMahon v. Newton, 67 
 Conn. 79, 34 Atl. 709, and many other cases. That section 1147 was 
 not intended to change the law respecting the necessity of an assign- 
 ment, or its equivalent, to make a valid gift of a chose in action, not 
 itself evidenced by a writing, is shbwn by the fact that in the annotated 
 edition of the Code, edited by the committee that prepared it, there is 
 cited to support the section Hunter v. Hunter, 19 Barb. (N. Y.) 631, in 
 which case the above passage from Kent is quoted and approved. 
 
 In the present case it is true that Samuel D. Prather was possessed 
 of the physical power and of the official authority, by reason of his re- 
 lation to the defendant, to make the necessary changes on its books 
 to show that the indebtedness was due to him and not to the decedent. 
 But this power did not emanate from the decedent. Samuel possessed 
 it before the asserted gift as well as after. The decedent did not even 
 authorize him to inake such changes, nor suggest that the gift might 
 be effected in that way. It was not shown that such method was 
 in the mind of the donor. The fact that it was a book account, or 
 that a change might be made in the name of the debtor, was not even 
 
 COEBIN CONT. 72 
 
1138 ASSIGNMENT (CL 7 
 
 mentioned in the conversation. The law intends something more than 
 a mere power to make physical entries in the books of the debtor 
 in such a case. The authority to make the change, or cause it to be 
 made, must be vested in the debtor by reason of some act or direction 
 of the creditor. If verbal gifts could be made in such loose manner 
 as this it would open the door to innumerable frauds and perjuries. 
 
 For this reason the authorities hold that something more than mere 
 physical power is necessary; something rtiore than the previous pos- 
 session of the property or of the means of obtaining it; something 
 emanating from the donor which operates to give to the donee the 
 means of obtaining such possession and control. 
 
 The case is not different in principle from PuUen v. Placer County 
 Bank, 138 Cal. 170, 66 Pac. 740, 71 Pac. 83, 94 Am. St. Rep. 19. In 
 that case a father gave to his son a check for $1,000 upon the bank, 
 with the intention of making to him a gift of that amount of money. 
 After delivering the check to the son the father stated that he wished 
 he would not present it until after his death. The son awaited his 
 death and then presented the check, which the bank refused to pay, 
 on the ground that the death of the father revoked it. The court said : 
 
 "In the present case the gift was verbal, and the property which 
 the father intended to give to his son was money on deposit in the bank. 
 The check was not itself the property which the father intended to give, 
 but was merely a direction to the defendant to pay $1,000 to the son. 
 It indicated the amount to be given and the place at which the money 
 was to be delivered. The check was not a symbolic delivery of the 
 money, but it was a delivery of the means by which the son could 
 obtain possession of the money. It was, however, subject to revocation 
 by the father at any tirne before its presentation to the bank, and was 
 in fact revoked by his death. The request of the father that the son 
 would not present the check until after his death did not affect the 
 sufficiency of the gift. If the gift were complete by his delivery of the 
 check, such subsequent request would not destroy its validity, and 
 if not then complete, this request would not have the effect to dispense 
 with its presentation for the purpose of making it complete. By the 
 failure of the son to present -the check, there was no delivery of the 
 money during the lifetime of the father, and the gift was therefore 
 not complete." 
 
 The mere delivery of an order for the payment of a debt is there- 
 fore not sufficient to make a complete gift thereof. In the present case 
 there was not even the delivery of an order, nor any suggestion there- 
 of. All that was done was to declare the present intention to give the 
 indebtedness to Samuel D. Prather. No means whatever were deliv- 
 ered by the donor to the donee by which the latter could obtain pay- 
 ment of the indebtedness.. The fact that Samuel D. Prather was the 
 managing officer of the defendant and had power to change its books 
 did not make the gift effectual. The indebtedness was due from the 
 defendant and not from Samuel D. Prather, and it was necessary 
 
Ch. 7) ASSIGNMENT 1139 
 
 that the defendant should have some aiithority from Thomas Prather 
 before it could legally make a change upon the books of the company 
 to show the change in the indebtedness. Thomas Prather gave no 
 such authority to his brother or to any other person. ■ 
 
 The conclusion of the court below upon the facts found was not in 
 accordance with the law, and its finding of the ultimate fact that 
 Thomas Prather transferred the debt to Samuel D. Prather by way 
 of a verbal gift is not supported by the evidence. Consequently the 
 judgrnent and order cannot be upheld. 
 
 The judgment and order are reversed and the cause is remanded, 
 wih directions to the court below to enter judgment upon the findings 
 in favor of the plaintiff for the amount prayed for.^* 
 
 AMERICAN BRIDGE CO. OF NEW YORK et al. v. 
 CITY OF BOSTON. 
 
 (Supreme Judicial Court of Massachusetts, 1909. 202 Mass. 374, 88 N. E. 
 
 1089.) 
 
 Action by the American Bridge Company of New York and others 
 against the City of Boston. Verdict for plaintiffs, and defendant ex- 
 cepts. Exceptions sustained. 
 
 Hamhond, J. This is an action of contract brought by the plain- 
 tiffs as assignees of all "the moneys now due or which may hereafter 
 become due" to one Coburn, the assignor under two certain building 
 contracts between him and the defendant, dated respectively July 16, 
 1901, and August 27, 1901. It is brought to recover the amount of 
 two architect's certificates, one for $2,210 and the other for $3,085.50, 
 each dated November 10, .1902. The case was heard upon, the audi- 
 tor's report (which was for the defendant) and certain exhibits, by a 
 justice of the superior court, sitting without a jury, who found for the 
 plaintiffs for the full amount claimed; and it is before us upon ex- 
 ceptions taken by the defendant. 
 
 These exceptions raise the general question whether in this action 
 the defendant may recoup for the damages sustained by the default 
 of the assignor, which occurred after the defendant had notice of the 
 assignment. 
 
 It is contended by the plaintiffs that these sums were due and pay- 
 able at the time the defendant received notice thereof, that the plain- 
 tiffs' rights were fixed at the time of notice and could not be changed 
 by the, act of the assignor or of the defendant after notice, and conse- 
 quently that the damages caused to the defendant by the default of 
 the assignor in leaving his contract unperformed, although without 
 any fault or collusion on the part of the defendant, cannot be re- 
 couped in this action. It is contended that the only remedy open to 
 the defendant is by way of an action against the assignor. 
 
 i» See note in 3 A. L. R. 928. 
 
1140 ASSIGNMENT (Ch.7 
 
 Even if it be conceded in favor of the plaintiffs tliat the sums were 
 due and payable at the time of the notice, and that the rights of the 
 plaintiffs were fixed at that time, still the conclusion which the plain- 
 tiffs seek to draw by no means necessarily follows. 
 
 We are deahng, not with the right of set-off, but with that of re- 
 coupment-— an entirely different right. The one is a creation of stat- 
 ute; the other exists at common law and not by statute. The one is 
 applicable even where there are different contracts ; the other arises 
 only out of the same contract as that under whicli the claim of the 
 plaintiffs, arises. Confusion sometimes has been caused by a neglect 
 to note the distinction between these two rights. The principles 
 applicable to a case of set-off are in many respects different from 
 those applicable to a case of recoupment, and some care is required 
 not to be misled by apparent analogies. 
 
 The assignment of a chose in action conveys, as between the as- 
 signor and assignee, merely the right which the assignor then pos- 
 sesses to that thing; but as between the assignee and the debtor it 
 does not become operative until the time of notice to the latter, and 
 does not change the rights of the debtor against the assignor as they 
 exist at the time of the notice. 
 
 It becomes necessary to consider the exact relation between the 
 defendant and Coburn, the assignor, at the time of the notice. The 
 auditor has found that written notice of the assignments were given 
 to the defendant on November 14, 1902, before the service of any 
 trustee process. At that time there does not seem to have been any 
 default on the part of Coburn. At the time of the notice what were 
 the rights between him and the defendant, so far as respects this con- 
 tract? He was entitled to receive these sums, but he was also under 
 an obligation to complete his contract. This right of the defendant 
 to claim damages for the nonperformance of the contract existed at 
 the making of the contract and at the time of assignment and of 
 notice, and the assignees knew it, and they also knew that it would 
 become available to the defendant the moment the assignor should 
 commit a breach. Under these circumstances it must be held that 
 the assignees took subject to that right. Coburn, the assignor, aban- 
 doned the work in a few days after the notice. This action was not 
 brought until October 30, 1906, nearly four years after the breach. 
 
 Even if the sums were due and payable in November, 1902, at the 
 time of the notice, still if this action Had been brought by the assignor 
 after the default, there can be no doubt that the defendant would have 
 had the right to recoup the damages suffered by his default. And the 
 assignees who seek to enforce this claim can stand in no better posi- 
 tion in this respect than the assignor. The defendant is simply trying 
 to enforce a right existing under the contract at the time of the notice, 
 a right of which the assignees had knowledge, and since they have 
 delayed suit for these sums, until after default, the defendant may re- 
 coup against them as it could have recouped against the assignor. It 
 
Cll. 7) ASSIGNMENT JJ^^j 
 
 cannot without its own fault or consent be deprived of rights under 
 the contract. Any other conclusion would make the contract different 
 from that into which the defendant entered. The case is very similar 
 to Rockwell V. Daniels, 4 Wis. 432, in the reasoning of which we fully 
 concur. See, also. Government of Newfoundland v. Newfoundland 
 Ry., 13 App. Cas. 199. We see nothing in First National Bank v. 
 Perris Irrigation District, 107 Cal. 55, 40 Pac. 45, or Wilkinson v. 
 ■Qements, 42 L. J. Ch. (N. S.) 38, cited by the plaintiffs, which 
 changes our view. They seem to proceed upon the principle of sepa- 
 rate contracts. 
 Exceptions sustained.^" 
 
 HOMER v. SHAW. 
 (Supreme Judicial Court of Massachusetts, 1912. 212 Mass. 113, 98 N. E. 697.) 
 
 Action by Horace S. Homer against Frederick E. Shaw. There 
 was a finding for defendant, and plaintiff excepts. Exceptions over- 
 ruled. 
 
 Plaintiff's assignor entered into a contract with defendant to trans- 
 port, erect, and paint the steel work of a section of subway at $6 per 
 ton, to be paid monthly for all work completed. 
 
 Bealey, J. The defendant's liability upon acceptance of the assign- 
 ment depended upon the assignor's performance of his contract, to 
 transport, erect and paint the steel work required for a section of a 
 subway which the defendant was building in accordance with the 
 plans and specifications of the transit commissioners. If not fully 
 performed, the entire contract price, although payable in monthly in- 
 stallments, never became due, or if before completion the assignor, 
 by reason of his inability to go on, voluntarily abandoned the work, 
 he could not recover for work and labor already performed and fur- 
 
 20 An assignee gets no better riglit than the assignor had, and defenses that 
 would have been good against the assignor are good against the assignee. 
 Eice V. Friend. Bros. Co., 179 Iowa, 355, iSl N. W. 310 (1917), counterclaims 
 for breach of warranty ; Brunswig v. Farmers' Grain, Fuel & Live Stock Co., 
 100 Kan. 261, 164 Pac. 154 (1917), previous modifications in the contract; 
 Suhr V. Metcalfe, 33 Cal. App. 59,, 164 Pac. 407 (1917) ; Warner v. Whittaker, 
 6 Mich. 133, 72 Am. Dec. 65 (1858) ; Lane v. Smith, 103 Pa. 415 (1883) ; 
 Parmly v. Buckley, 103 111. 115 (1882) ; Mangles v. Dixon, 3 H. L. 0. 735 
 (1852) ; Graham v. Johnson, ,8 Eq. 36 (1869), fraiid; Crouch v. Credit Fon- 
 der, L. R. 8 Q. B. 380 (1873) ; Stoddart v. Union Trust, [1912] 1 K. B. 181; 
 Steltzer v. C. M. & St. P. R. Co., 156 Iowa, 1, 134 N. W. 573 (1912), employ- 
 er expressly reserved power to apply wages to board bills. 
 
 In some states he takes subject to whatever equities exist in favor of third 
 persons against the assignor. Owen v. Evans, 134 N. T. 514, 31 N. E. 999 
 (1892) ; Kemohan v. Durham, 48 Ohio St. 1, 26 N. B. 982, 12 L. R. A. 41 
 (1891) ; Green v. Consolidated Wagon & Machine Co., 30 Idaho, 359, 164 
 Pac. 1016 (1917), assignor's contract provided for payment to specified pre- 
 vious creditors. " ?, ' . 
 
1142 ASSIGNMENT (Ch. 7 
 
 nished. Homer v. Shaw, 177 Mass. 1, 58 N. E. 160; Burke v. Coyne, 
 188 Mass. 401, 404, 74 N. E. 942; Buttrick Lumber Co. v. Collins, 
 202 Mass. 413, 420, 89 N. E. 138. A few days only elapsed after the 
 assignor entered upon the performance of the contract when he in- 
 formed the defendant that, owing to, the failure of the plaintiff to 
 advance money, which apparently he had agreed to furnish, he would 
 be unable to complete the work, as his workmen had not been paid, 
 and if their wages remained in arrears they would leave his employ- 
 ment. The evidence, if no further action had been taken by the 
 parties, and performance of the work had ceased, would have war- 
 ranted a finding that, the assignor having repudiated or abandoned 
 his" contract before the first installment of the contract price became 
 payable, the defendant would not have been indebted to the plaintiff. 
 Homer v. Shaw, 177 Mass.,1, 58 N. E. 160; Bowen v. Kimbell, 203 
 Mass. 364, 370, 371, 89 N. E. 542, 133 Am. St. Rep. 302; Barrie v. 
 Quinby, 206 Mass. 259; 267; 92 N. E. 451. 
 
 But without any ostensible change the assignor remained in charge 
 of the work until completion, and the plaintifi contends under the sub- 
 stituted declaration, that the money thereafter received should be 
 considered as earned under the original contract. The assignor need- 
 ed Immediate financial assistance, and if the defendant might have 
 advanced the money which the evidence shows he furnished to enahle 
 him' to pay his employees, yet if he had doiie so the plaintiff's assign- 
 ment would have been given' priority over the loan. Buttrick Lumber 
 Co; V. Collins, 202 Mass. 413, 89 N. E. 138. 
 
 The parties, while they could not modify to his prejudice the terms 
 of the contract assigned, without the plaintiff's consent, or by a secret 
 fraudulent arrangement deprive him of the benefit of the assignment, 
 were not precluded from entering into a new agreement if perform- 
 ance by the assignor had become impossible from unforeseen circum- 
 stances. Eaton V. Melius, 7 Gray, 566, 572 ; Linnehan v. Matthews, 
 149 Mass. 29, 20 N. E. 453. It consequently was a question of fact 
 upon all the evidence for the presiding judge before whom the case 
 was tried without jury to decide whether upon facing the exigencies 
 of changed conditions the parties mutually agreed to a cancellation, 
 and thereupon in good' faith an independent contract was substituted, 
 by the terms of which the defendant undertook to furnish sufficient 
 funds to pay the workmen the wages then due, and their future wages 
 as they accrued, while the assignor was to receive a weekly salary for 
 his personal services of supervision. The refusal to comply with the 
 plaintiff's requests for findings, and the genferal finding for the de- 
 fendant manifestly show bis conclusion to have been that the first 
 contract was treated as having been rescinded, and the plaintiff had 
 no enforceable claim against the defendant under the assignment. 
 Earnshaw v. Whittempre, 194 Mass. 187, 192, 80 N. E. 520; Glidden 
 V. Massachusetts Hospital Life Ins. Co., 187 Mass. 538,' 541, 73 N. E. 
 
Ch. 7) ASSIGNMENT 1X43 
 
 538. The plaintiff's requests for rulings in so far as they were not 
 given were rightly refused, and the exceptions must be overruled. 
 So ordered.^ ^ 
 
 MUIR V. SCHENCK & ROBINSON. 
 (Supreme Court of New York, 1842. 3 Hill, 228.) 
 
 Debt on bond, tried at the Cayuga circuit, in October, 1841, be- 
 fore Moseley, Chief Judge. The case was this : On the 5th of Sep- 
 tember, 1836, the bond in question, and a mortgage of the same 
 date, were executed by the defendants to the plaintiff. The bond 
 was conditioned for the payment of $1500, in five equal annual in- 
 stallments, with interest. The first three installments were paid to 
 the plaintiff, who, on the 13th of November, 1839, assigned and de- 
 livered the bond to Ira Doty, as collateral security for the payment 
 of a note of $318.85, held by him against the plaintiff. On the 
 9th of March, 1840, the plaintiff executed to Sedgwick Austin an 
 absolute assignment of the mortgage "and the bond therein refer- 
 red to," in payment of certain notes held by Austin against the plain- 
 tiff, which were thereupon delivered up to the latter. In this as- 
 signment the plaintiff covenanted that there remained unpaid the 
 sum of $600, and interest from the 5th of September, 1839. Austin 
 gave immediate notice of the assignment to the defendants, who 
 promised to pay him. Accordingly, in September, 1840, Ihe defend- 
 ants paid Austin the fourth installment, ($342,) and on the 6th of 
 September, 1841, they paid the balance; whereupon he acknowl- 
 edged satisfaction of the mortgage. Intermediate these two pay- 
 ments, viz. in October, 1840, Doty gave notice to the defendants that 
 the bond had been assigned to him before the assignment to Austin ; 
 and forbade any further payments to the latter ; claiming a right to 
 the money thereafter to become due. The defendants enquired why 
 he had not given notice before, and Doty gave as a reason, that he 
 did not suppose he would be obliged to resort to the bond in order 
 to obtain payment of the debt due from the plaintiff. This action was 
 brought for the benefit of Doty, who insisted that he was entitled 
 to recover the last installment with interest. The circuit judge 
 charged the jury, that the payment to Austin of the last installment 
 was rightfully made by the defendants, notwithstanding the notice 
 from Doty. The jury rendered a verdict for the defendants, and 
 the plaintiff now moved for a new trial on a case. 
 
 By the Court, CowEn, J. The question is, whether the defendants 
 were right in preferring Austin, and making the last payment to 
 him instead of Doty. Doty had the first assignment from the obli- 
 
 21 Tf fhp asslenor's right was subject to a condition precedent, so is the as- 
 signee's right Whan V Hope Natural Gas Co., 81 W. Va. 338, 94 S. E. 365 
 (1917). 
 
1144 ASSIGNMENT (Ch. 7 
 
 gee, and, as between him and Austin, was entitled to the money. 
 In a conflict of equitable claims, the rule is the same at law as in 
 equity, qui prior est tempore, potior est jure. There was no need 
 of notice to Austin for the purpose of securing the preference as 
 against him; and Austin might have been compelled at the elec- 
 tion of Doty to pay over to him the last installment received from 
 the defendants. But before that installment was paid, he chose to 
 fix the defendants by giving notice of his right to them, and for- 
 bidding the payment of any more to Austin. The payments were 
 correctly made to the latter, till notice.''^ The payment afterwards, 
 was in the defendants' own wrong. The notice, when it came, af- 
 forded them a complete protection, and had the farther effect to 
 render what was before an inchoate right in Doty, perfect from the 
 beginning. As Austin had never any right to receive, the defend- 
 ants had now no right to pay. No one would doubt that the first 
 assignment divested the right of the obligee, thoug'h the legal in- 
 terest remained in him. Could he transfer to Austin a greater right 
 than his own? His legal interest was not assignable; and he had 
 parted with all his equitable right. Does it not follow that nothing 
 remained for Austin? 
 
 The decision at the circuit, I admit, derives some degree of coun- 
 tenance from the remarks made by Chancellor Kent in Murray v. 
 L,ylburn, 2 John. Ch. 441, 443. I allude to the view there taken of 
 Redfearn v. Ferrier, 1 Dow's Pari. Cas. 50, which the learned Chan- 
 cellor supposed should perhaps be received as a qualification of the 
 rule laid down by Lord Thurlow, in Davis v. Austin, 1 Ves. Jun. 
 249, who said: "A purchaser of a chose in action must always 
 abide by the case of the person from whom he buys; that I take 
 to be an universal rule." True, his lordship was speaking of the 
 case of the assignor, as it stood between him and the debtor; yet 
 the same rule has been often applied to a case as between him and 
 one of his previous assignees. Nothing is better settled, for in- 
 stance, than that, the previous assignment of a chose in action will 
 prevent its passing to assignees by a general assignment under the 
 bankrupt or insolvent acts; an assignment carrying even the legal 
 right, and this too, without notice either to the debtor or the sub- 
 sequent assignees. Ordinarily, any notice to subsequent conven- 
 tional assignees must be out of the question; for the first assignee 
 cannot know who they will be. Notice to the debtoi: might, I admit, 
 afiford them a better chance; for then there would be one of whom- 
 they might enquire, and of whom they naturally would enquire. 
 
 22 That payment by the debtor operates to discharge him, when made either 
 to the assignor or to the later of two assignees, if he has received no notice of 
 the first assignment, see Meghan v. Mills, 9 Johns. (N. Y.) 64 (1812) ; 
 Heermans v. Ellsworth, 64 N. Y. 159 (1876) ; Williams v. Sorrell, 4 Ves. 389 
 (1799) ; Stocks v. Dobson, 4 D. M. & G. 15 (1853). The rule was the same at 
 Roman Law Dig. II, 15, 17. 
 
Ch. 7) ASSIGNMENT 1140 
 
 This might prevent fraud; and, to require it, would therefore per- 
 haps be very proper. It is required by the law of Scotland, as ap- 
 pears by Redfeam v. Ferrier, which was decided upon the Scotch 
 law. By that law there must be what is called an intimation to the 
 debtor, befofe the assignment is perfect and secures a complete 
 preference even as against a subsequent assignee. In suggesting, 
 however, that such is perhaps the law of England or of this state, 
 Chancellor Kent admitted that he was doing what was not neces- 
 sary to the decision of the case under his consideration, which turn- 
 ed on a point entirely dififerent, viz. a lis pendens operating as con- 
 structive notice. In Livingston v. Dean, 2 John. Ch. 479, there was 
 actual notice. But neither Redfearn v. Ferrier, nor the two cases 
 decided by Chancellor Kent, related to a previous express assign- 
 ment. There was scarcely the semblance of such an assignment, 
 but only a trust to be inferred by the court of chancery from cir- 
 cumstances — a sort of implied trust— a creature peculiar to that 
 •court. The prior right claimed, was spoken of as a latent equity. 
 As between express assignments, I take the law to be correctly laid 
 down by Parker, C. J., in Wood v. Partridge, 11 Mass. 488, 491, 
 492. He said: "Between assignor and assignee the contract is 
 •complete without any notice to the debtor;" and he considered the 
 notice as intended to protect the debtor alone. Story, J., in his 
 learned work on the Conflict of Laws, (pages 328 to 330,) mentions 
 the difference between the Scotch law and our own, admitting the 
 necessity of intimation in the former. He says, that according to 
 our law, an assignment operates, per se, as an equitable transfer of 
 the debt, and he concedes that notice is necessary to protect the 
 debtor; adding: "But an arrest or attachment of the debt in his 
 hands by any creditor of the assignor, will not entitle such creditor 
 to a priority of right, if the debtor receive notice of the assignment 
 pendente lite, and in time to avail himself of it in discharge of the 
 suit against him." That has been held in several cases. Bholen v. 
 Cleveland, 5 Mason, 174, 176, Fed. Cas. No. 1381 ; Foster y. Sinkler, 
 4 Mass. 450; Dix v. Cobb, 4 Mass. 508. In Wood v. Partridge, this 
 <luestion between a previous assignee and a subsequent attaching 
 creditor, was considered the same in principle as that between con- 
 flicting assignees. It is undoubtedly so. The principle has been 
 declared by other cases. White's Heirs v. Prentiss' Heirs, 3 T. B. 
 Hon. (Ky.) 510; Madeiras v. Catlett, 7 T. B. Mon. (Ky.) 477. In 
 Jordan v. Black, 6 N. C. 30, the claim of the assignee presented a 
 very strong equity. Hall, J., said, in substance, that "upon an exam- 
 ination of the authorities it would be found that the ground taken 
 by the assignee of being a bona fide purchaser, is tenable by those 
 persons only who have the legal title in them, and plead that they 
 are purchasers for a valuable consideration without notice. By this 
 plea they, shew that they have as much equity on their side as their 
 •opponents ; and that being the case, a court of equity will not inter- 
 
1146 ASSIGNMENT (Ch. 7 
 
 fere and divest them of their legal title. All that the assignee shows 
 is, that she purchased the assignor's right to a chose in action. She 
 has no legal, but only an equitable title." 
 
 No fraud upon Austin's rights is imputable to Doty. He enter- 
 tained a confidence that the assignor would pay his cl^im, and that 
 he should therefore not find it necessary to take measures for col- 
 lecting the bond. He gave notice to the defendants as soon as he 
 found himself disappointed. 
 
 Nor is it any answer to Doty's claim, that the defendants promised 
 to pay Austin. It is said truly, that this, in an ordinary case, would 
 have entitled him to an action in his own name. Prima facie it 
 brought him within the rule, that an assignee of a chose in action 
 may sue in his own name, on an express promise by the debtor to 
 pay him. This arises from consideration and privity; but in the 
 case at bar, the assignment to Austin having failed of effect by rea- 
 son of the prior assignment to Doty, there was no consideration for 
 the promise. The case is the same as if Austin had held no as- 
 signment even in form. The last payment by the defendants was, 
 therefore, made in their own wrong ; and there must be a new trial, 
 the costs to abide the event. 
 
 New trial granted. ^^ 
 
 ADAMSON V. PAONESSA et al. 
 (Supreme Court of California, 1919. 180 Cal. 157, 179 Pae. 880.) 
 
 Interpleader suit by John Z. Adamson against George C. Paonessa, 
 Charles W. Lloyd, and the National Surety Company. From judgment 
 for defendant Dloyd, defendant National Surety Company appeals. 
 Judgment modified by striking out a portion, and new trial ordered on 
 a single issue. 
 
 Lawlor, J. This is an appeal from a judgment in an interpleader 
 suit in favor of one of the defendants and claimants as against the, 
 other defendant and claimant. There is practically no conflict in the 
 evidence, and the material facts are as follows : 
 
 One Paonessa entered into a contract with the city of Colton for the 
 doing of certain street work under the Improvement Act of 1911. 
 Stats. 1911, p. 730. As a condition of the contract he was required by 
 the statute to give, and did give, a surety bond for the payment of 
 claims for materials furnished or labor rendered in the doing of the 
 work. The appellant. National Surety Company, was the surety on 
 this bond. In order to obtain the bond the contractor, Paonessa, made 
 a written application to the surety company which, by. its terms, con- 
 
 2^ In accord: Niles v. Mathusa, 162 N. T. 546, 552, 57 N. E. 184 (1900) ; 
 Williams v. Ingersoll, 89 N. Y. 508 (1882) ; Thayer y. Daniels, 113 Mass. 129 
 (1873) ; Sutherland v. Keeve, 151 111. 384, 38 N. E. 130 (1894) : Summers v. 
 Hutson, 48 Ind. 228 (1874). 
 
Ch. 7) ASSIGNMENT 1147 
 
 stituted a contract between them. The portion of this application con- 
 tract material here reads: 
 
 "All payments specified in the above-mentioned contract [i. e., the 
 contract with the city of Colton for the doing of the work] to be with- 
 held by the obligee until the completion of the work shall, as soon as 
 the work is completed, be paid to the company [i. e., the surety com- 
 pany], and this covenant shall operate as an assignment thereof, and 
 the residue, if any, after reimbursing the .company as aforesaid, be 
 paid to the applicant after all Uability of the company has ceased to 
 exist under said bond." 
 
 No notice of this assignment, if it be such, was given to the city of 
 Colton, or, so far as appears, to any one else, until shortly before the 
 commencement of this litigation. 
 
 While the work was in progress the other defendant, the respondent 
 here, one Lloyd, advanced certain sums of money to the contractor, 
 Paonessa, and took from him an assignment of all his rights under the 
 contract, all without notice of the prior assignment to the surety com- 
 pany and in complete ignorance of it. This assignment Lloyd filed with 
 the city clerk immediately. 
 
 The proceedings under which the contract was let provided, as per- 
 mitted by the statute, for payments in street improvement bonds. Up- 
 on the completion of the contract, the city authorities, recognizing 
 Lloyd as the assignee of Paonessa, delivered to him the warrant and 
 assessment for the payment of the work, and the city treasurer was 
 about to issue to him street improvement bonds in payment when the 
 surety cpmpany demanded of the city treasurer the issuance of the 
 bonds to it. This was the first notice to the city authorities of any 
 claim of assignment-to the surety company. 
 
 In the meantime Paonessa had failed to pay claims approximating 
 .$10,000 for material and labor furnished and rendered in completing 
 the contract. The surety company was obligated under its bond to pay 
 these claims and did so. No claim is made by the respondent that sUch 
 .payment was not pursuant to the obligation of the bond and in strict 
 accord with it. 
 
 Upon the surety company demanding the issuance oi the bonds to it 
 and Lloyd insisting that they be issued to him, the city treasurer in- 
 terpleaded the two claimants and deposited the bonds in court. A trial 
 was had and judgment was rendered against the surety company in 
 favor of Lloyd that the bonds be delivered to the latter. 
 
 The contention of the surety company that the judgment is erroneous 
 and that it is entitled to the bonds, or at least to sufficient thereof to re- 
 imburse itself for the amounts which it paid to materialmen and labor- 
 ers, is twofold." * * * 
 
 The second point made by the appellant is that, by virtue of the 
 provision heretofore quoted of the application contract executed by 
 
 2* The discussion of tbe company's first point is omitted. 
 
1148 ASSIGNMENT (Ch. 7 
 
 Paonessa, he assigned to the appellant his right to the bonds subse- 
 quently to become due him under the contract, and that this assignment, 
 being prior in time to the assignment by Paonessa to Lloyd, is prior in 
 right. 
 
 Passing for the time being the question as to the stifficiency of the 
 contract provision as an assignment by Paonessa, it does not follow 
 that because it is prior in time it is necessarily prior in right to the 
 subsequent assignment to Lloyd. The surety company neglected to give 
 immediate notice of the assignment to it, and before it gave such no- 
 tice Lloyd had taken an assignment for a valuable consideration with- 
 out notice or knowledge of the prior assignment, and had given notice 
 of his own assignment. The rule in such a case is well established. It 
 is thus stated in Widenmann v. Weniger, 164 Cal. 667, 672, 130 Pac. 
 421,424: 
 
 "The effect of such successive assignments and the rights of the suc- 
 cessivfr assignees without notice, with respect to each other, were con- 
 sidered and decided in Graham Paper Co. v. Pembroke, 124 Cal. 117 
 [56 Pac. 627]. There is some conflict of authority on the subject, but 
 this court approved and followed the English rule stated as follows: 
 'As between successive assignees of a chOse in action, he will have 
 the preference who first gives notice to the debtor, even if he be a sub- 
 sequent assignee, provided at the time of taking it he had no notice of 
 a prior assignment.' " 
 
 The judgment of the lower court, therefore, in directing the delivery 
 of the bonds to Lloyd, was correct and to that extent is affirmed. 
 
 The judgment of the lower court, however, goes further than this. 
 The court found and its judgment decrees, that the surety company has 
 no right or interest in the bonds. The evidence" at the trial showed 
 without conflict that Lloyd took his assignment by way of security for 
 advances. It follows that as between himself and Paonessa he was- 
 not the absolute owner of the bonds. Paonessa still had an interest in 
 them. If, then, the application contract executed by Paonessa did in 
 fact amount to an assignment by him to the surety company, the latter 
 stood in the former's shoes, and had, and still has, an interest in the 
 bonds, and the finding of the court to the contrary is not supported 
 by the evidence. This brings us to the question of the sufficiency of 
 the application contract as an assignment by Paonessa to the surety 
 company. If it amounts to an assignment, the finding that the surety 
 company has no interest in the bonds is contrary to the evidence, and 
 the decree of the court to the same effect is in that particular incor- 
 rect. * * * 26 
 
 The judgment of the lower court is therefore modified by striking 
 out the portion which decrees that the appellant has no right or in- 
 terest in the bonds, and a new trial is ordered on the single issue as to 
 
 2 5 The court then held that the surety company's contract operated as an. 
 assignment. 
 
Ch. 7) ASSIGNMENT 1149 
 
 whether or not as between himself and the surety company the re- 
 spondent Lloyd holds the bonds as absolute owner or by way of security 
 merely. 
 
 Both prior to the commencement of the litigation and at the time of 
 the trial respondent Lloyd offered to account to the surety company 
 for any balance which he might receive from the bonds after the sat- 
 isfaction of his own advances. This was all that the surety company 
 was entitled to. Accordingly, although the judgment is reversed in 
 part and a new trial is directed as to one of the issues, it is ordered 
 that appellant pay the costs of appeal.^^ 
 
 HERMAN V. CONNECTICUT MUT. LIKE INS. CO. et al. 
 
 (Supreme Judicial Court of Massachusetts, 1914. 218 Mass. 181, 105 N. E. 450, 
 Ann. Cas. 1916A, 822.) 
 
 Bill ,by Joseph Herman against the Connecticut Mutual Life In- 
 surance Company and others. Reported by a single justice for the de- 
 termination of the full court. Bill dismissed, unless plaintiff desires a 
 decree for partial relief. 
 
 The bill was brought by plaintiff, claiming to be an assignee of a life 
 policy of life insurance in the defendant company, against the com- 
 pany and other defendants, of whom defendant Harry R. Stanley, as 
 executor, claimed to hold the policy under an assignment subsequent 
 in time to that of plaintiff, to establish plaintiff's rights in and to the 
 policy under his -assignment. When the assignment to plaintiff was 
 made, the business was transacted by George E. Williams, agent of 
 the insurance company, as agent for insured. Williams sent plaintiff 
 the assignment, but did not deliver the policy, and, upon inquiry being 
 made, told plaintiff that the company held it as collateral for a pre- 
 mium loan. The suit was brought in insured's lifetime. 
 
 Shei^don, J. 1. The defendant Stanley's demurrer to the bill was 
 overruled rightly. The bill states a proper case for equitable relief. 
 Brigham v. Home Life Ins. Co., 131 Mass. 319; French v. Peters, 177 
 
 26 In accord: Dearie v. Hall, 3 Kuss. 1 (1823); Marchant v. Morton, 
 Down & bo, [1901] 2 K. B. 829; Jenkinson v. N. Y. Finance Co., 79 N. 
 J. Eq. 247, S2 Atl.'SG (1911) ; Peters v. Goetz, 136 Teen. 257, 188 S. W. 
 1144 (1916) ; Hess & S. Eng. Co. v. Turney (Tex. Civ. App.) 207 S. W. 
 171 (1918) ; Graham Paper Co. v. Pembroke, 124 Cal. 117, 56 Pac. 627, 44 L. 
 R. A. 632, 71 Am. St. Rep. 26 (1899) ; Vanbuskirk v. Hartford Fire Ins. Co., 14 
 Conn. 141, 36 Am. Dec. 473 (1841) ; Clodfelter v. Cox, 1 Sneed (Tenn.) 330, 
 60 Am. Dec. 157 (1853) ; Fraley's Appeal, 76 Pa. 42 (1874) ; Murdoch v. 
 Finney, 21 Mo. 138 (1855)'; Ward v. Morrison, 25 Vt. 593 (1853). 
 
 An assignee, who has given no notice to the debtor, is generally preferred 
 over a subsequent attaching creditor; the latter not being in as strong a 
 position asia subsequent innocent assignee for value. Hall v. Kansas City 
 Terra Cotta Co., 97 Kan. 103, 154 Pac. 210, L. R. A. 1916D, 361, note, Ann. 
 Cas. 1918D, 605 (1916) ; Market Nat. Bank v. Raspbeixy, 34 Okl. 243, 124 
 Pac. 758, L. R. A. 1916E, 79, note (1912) ; Pellman v. Hart, 1 Pa. 263 (1845). 
 Contra : Vanbuskirk v. Hartford Fire Ins. Co., supra. 
 
1150 ASSIGNMENT (Ch. 7 
 
 Mass. 568, 573, 574, 59 N. E. 449; A somewhat similar bill was main- 
 tained in Blinn v. Dame, 207 Mass. 159, 93 N. E. 601, 20 Ann. Cas. 
 1184. < 
 
 2. The plaintiff by his assignment from Sommer acquired as against 
 the latter a valid title to the policy of insurance which here is in ques- 
 tion. As between the plaintiff and Sommer it is immaterial that the as- 
 signment was not written upon or attached to the policy, that no ref- 
 erence to the assignment was written or noted on the policy, or that no 
 notice of it was given to the insurance company^ either in the man- 
 ner required by the fifth clause of the policy or otherwise. Mer- 
 rill V. New England Mut. Life Ins. Co., 103 Mass. 245, 252, 4 Am. 
 Rep. 548 ; Hewins v. Baker, 161 Mass. 320, 37 N. E. 441 ; Atlantic 
 Mutual Life Ins. Co. v. Gannon, 179 Mass. 291, 60 N. E. 933. See, 
 also. Northwestern Mutual Life Ins. Co. v. Wright, 153 Wis. 252, 140 
 N. W. 1078, Ann. Cas. 1914D, 697; Wood v. Phoenix Life Ins. Co., 
 22 La. Ann. 617; Manhattan Life Ins. Co. v. Cohen (Tex. Civ. App.) 
 139 S. W. 51; Howe v. Hagan, 110 App. Div. 392, 97 N. Y. Supp. 
 86; Cowdrey v. Vandenburgh, 101 U. S. 572, 25 L. Ed. 923 ; Dunlevy v. 
 New York Life Ins. Co. (D. C.) 204 Eed. 670; Fortescue v. Bennett, 3 
 M. & K. 36. The contrary statements in Palmer v. Merrill, 6 Cush. 
 282, 52 Am. Dec. 782, have not been followed. James v. Newton,- 142 
 M'ass. 366, 378, 8 N. E. 122, 56 Am. Rep. 692 ; Richardson v. White, 
 167 Mass. 58, 60, 44 N. E. 1072. The English rule, as stated in Dearie 
 V. Hall, 3 Russ. 1, though adopted in many other jurisdictions, is not 
 the law of this commonwealth. Thayer v. Daniels, 113 Mass. 129, 
 131; Putnam v. Story, 132 Mass. 205, 211." 
 
 It is true also, as the plaintiff has contended, that the owner of a 
 chattel does not, by merely intrusting to a third person the custody or 
 even the possession thereof, hold him out as its owner, and will not by 
 that fact alone be estopped from setting up his title against even a 
 bona fide purchaser from hjs bailee. Rogers v. Dutton, 182 Mass. 187, 
 189, 65 N. E. 56, and cases there cited. But we have here to do, not 
 with a chattel, but with a nonnegotiable chose in action, the right to 
 receive in the future a certain, sum of money upon the happening of 
 certain contingencies. The policy of insurance merely shows the exist- 
 ence, nature and extent of the right. As has been correctly stated by 
 counsel for Stanley : "It is the tangible evidence which the owner of 
 the right possesses in order to show title to the right." 
 
 27 By Mass. St. 1906, c. 390, the rule in Dearie v. Hall, supra, has been made 
 applicable in certain specified cases. See Hall v. Boston Plate & Window 
 Glass Co., 207 Mass. 328, 93 N. E. 640 (1911). For other statutory limitations, 
 see Mutual Loan Co. v. Martell, 200 Mass. 482, 86 N. E. 916, 43 L. R. A. (N. 
 S.) 746, 128 Am. St. Rep. 446 (1009). 
 
 By Rev. St. U. S. § 3477 (U. S. Comp. St. § 6383), certain formalities are 
 necessary to the validity of an assignment of a claim against the United 
 States. See National Bank of Commerce v. Downie, 218 U. S. 845, 31 Sup. 
 Ot. 89, 54 L. Ed. 1065, 20 Ann. Cas. 1116 (1910) ; Manhattan Commercial Co. 
 V. Paul, 216 N. T. 481, 111 N. E. 76 (1916) ; Cf. Jennings v. Whitney, 224 
 Mass. 138, 112 N. E. 655 (1916). 
 
Ch. 7) ASSIGNMENT 1151 
 
 The court must apply here the rule stated by the Chief Justice in 
 Baker v. Davie, 211 Mass. 429, 440, 97 N. E. 1094, 1097, 37 L,. R. A. 
 (N. S.) 944 : "That when an owner has so acted as to mislead a third 
 person into the honest belief that the one dealing with the property 
 had a right to do so, he is estopped from showing the truth." 
 
 The statement of Lord Herschell in London Joint Stock Bank v. 
 Simmons, [1892] A. C. 201, 215, quoted and followed by this court in 
 Gardner v. Beacon Trust Co., 190. Mass. 27, 28, 76 N. E. 455, 2 L. 
 R. A. (N. S.) 767, 112 Am. St. Rep. 303, 5 Ann. Cas. 851, is to the same 
 effect: "The general rule of law is that where a person has obtained 
 the property of another from one who is dealing with it without the 
 authority of the true owner, no title is acquired as against that owner, 
 even though full value be given, and the property be taken in the belief 
 that an unquestionable title thereto is being obtained, unless the per- 
 son taking it can show that the true owner has so acted as to mislead 
 him into the belief that the person dealing with the property had au- 
 thority to do so. If this can be shown, a good title is acquired by per- 
 sonal estoppel against the true owner." 
 
 The same general principle (although its application in that case de- 
 pended upon the existence of a custom) was stated again in Baker v. 
 Davie, 211 Mass. 429, 436, 97 N. E. 1094, 37 L. R. A. (N. S.) 944. See 
 also, Washington v. First Nat. Bank, 147 Mich. 571, 111 N. W. 349, 
 11 L. R. A. (N. S.) 471; Brocklesby v. Temperance Building Society, 
 [1895] A. C. 173, 181; Farquharson Brothers & Co. v. King & Co., 
 [1901] 2 K. B. 697. See Scollans v. Rollins, 173 Mass. 275, 53 N. 
 E. 863, 73 Am. St. Rep. 284. 
 
 But this estoppel of a rightful owner to set up his title against a bona 
 fide purchaser for value from one who had not the right to sell rests 
 upon the conduct of the rightful owner. It arises against him when 
 by his own conduct he has so clothed the wrongdoer with the indicia 
 of ownership as to justify third persons in regarding the wrongdoer 
 as either the rightful owner or as having authority from that owner. 
 The estoppel arises only from the owner's voluntary action tending 
 to produce and in fact producing that result. If this policy had been de- 
 livered to the plaintiff and then had been obtained from him by Som- 
 mer or Williams by means of a common-law larceny, there would have 
 been no foundation for an estoppel against the plaintiff, because, what- 
 ever-third persons might have thought or even might have been jus- 
 tified in thinking, the possession and apparent ownership would not 
 have been put into Sommer or into Williams as Sommer's agent by any 
 voluntary action of the plaintiff. Bangor Electric Light & Power Co. 
 v Robinson (C. C.) 52 Fed. 520; Farmers' Bank v. Diebold Lock & 
 Safe Co., 66 Ohio St. 367, 64 N. E. 518, 58 L. R. A. 620, 90 Am. St. 
 Rep 586 This distinction was stated clearly by Holmes, C. J., m Rus- 
 sell v. American Bell Tel. Co., 180 Mass. 467, 62 N. E. 751, et seq., ■ 
 citing as typical cases Knox v. Eden Musee American Co., 148 N. Y. 
 
1152 ASSIGNMENT (Ch. 7 
 
 441, 42 N. E. 988, 31 h. R. A. 799, 51 Am. St. Rep. 700, and Pennsyl- 
 vania R. R.'s Appeal, 86 Pa. 80. See, also, Varney v. Curtis, 213 Mass. 
 309, 312, 100 N. E. 650, X. R. A. 1916A, 629, Ann. Cas. 1914A, 340. 
 The rights of these parties depend upon the application of the princi- 
 ples which we have stated. 
 
 The plaintiff took his assignment by an instrument separate and apart 
 from the policy itself. He allowed the possession of the policy to 
 remain unaltered. It is true that he did this on the false representa- 
 tion that it was held by the insurance company as security for a pre- 
 mium loan; but the fact remains that it was his voluntary act. He 
 took no other precaution either by giving notice to the company or oth- 
 erwise. He testified that he did not even tell Sommer that the policy 
 had not been deHvered to him. He trusted everything to Williams; 
 and his own testimony was that he did this by reason of his "full con- 
 fidence in Williams." He knowingly allowed the circumstances to ,be 
 such as to indicate that Sommer retained the full ownership of the 
 policy, and such that no inquiry of the company would disclose any- 
 thing to the contrary or throw any doubt upon Sommer's title. ,For 
 this reason, such cases as Mente v. Townsend, 68 Ark. 391, 59 S. W. 
 41, are not applicable here. The case is a stronger one than Bridge v. 
 Connecticut Mut. Life Ins. Co., 152 Mass. 343, 25 N. E. 612, and the 
 reasoning of that opinion is decisive, against the plaintiff. There are 
 no circumstances upon which any distinction can be made in his 
 favor. 
 
 But the assignment to Stanley was not in reality, but only in form, 
 an absolute one. It was given to secure an indebtedness of Sommer 
 to Stanley. The plaintiff has a right to redeem from Stanley. This 
 makes it necessary to determine the amount for which Stanley can 
 hold the policy against the plaintiff. 
 
 This policy was assigned to Stanley on Febuary 2, 1910, to secure a 
 note for $3,000. Afterwards Stanley loaned to Sommer the further 
 sum of $1,000, and took from him a note for that amount, dated Feb- 
 ruary 2, 1911, and signed by Sommer. Above Sommer's signature, 
 Williams, without Sommer's knowledge or consent, wrote the words : 
 "Conn. Mut. policy 215356 as security." Those words described this 
 policy. 
 
 We need not consider whether this interpolation by Williams in the 
 note before its delivery to Stanley destroyed the validity of the note. 
 R. L. c. 73, §§ 141, 142; Stoddard v. Penniman, 108 Mass. 366, 11 
 Am. Rep. 363; Draper v. Wood, 112 Mass. 315, 17 Am. Rep. 92; Citi- 
 zens Nat. Bank v. Richmond, 121 Mass. 110; Greenfield Savs. Bank 
 V. Stowell, 123 Mass. 196, 25 Am. Rep. 67. But we are clearly of 
 opinion that it does not give to Stanley the right to hold the policy as 
 security for the payment of this latter note. The assignment to him was 
 to secure the payment of the note for $3,000, not what further amounts 
 might become due to him from Sommer. Sommer has never made or 
 
Ch. 7) ASSIGNMENT 1153 
 
 undertaken to make further assignment to Stanley, or given or- under- 
 taken to give to Stanley any greater rights in the policy. 
 
 The other questions raised are disposed of by the findings of fact 
 made in the superior court. 
 
 The plaintiff, if he so desires, may have a decree allowing him to 
 redeem the policy upon payment of the amount due on Sommer's note 
 for $3,000, with interest and costs, within such time and upon such 
 terms as may be determined by a judge of the superior court. If he 
 shall not so redeem, his bill must be dismissed with costs. 
 
 So ordered. 
 
 RABINOWITZ V. PEOPLE'S NAT. BANK. 
 
 (Supreme Judicial Court of Massachusetts, 1920. 235 Mass. 102, 126 N. E. 
 
 289.) 
 
 Action by Jacob Rabinowitz against the People's National Bank. 
 Verdict was directed for defendant, and plaintiff excepts. Exceptions 
 overruled. 
 
 Carroll, J. On September 13, 1917, one Cohen assigned certain 
 accounts which were then due him for goods sold, to the plaintiff as 
 security for a loan of $1,000, of which $573 has been paid. No notice 
 was given the debtors of this assignment. On October 4, 1917, Cohen 
 assigned the same accounts to the defendant, as security for a loan 
 which he then obtained; the defendant collected $600 on the accounts. 
 This action is for money had and received, to recover $427. In the 
 superior court there was a directed verdict for the defendant, and the 
 plaintiff excepted. 
 
 Although the assignment to the plaintiff was earlier in time than the 
 one to the defendant, plaintiff cannot recover for money had and re- 
 ceived. There was a valid consideration for the later assignment. It 
 does not appear that the defendant knew of the one to the plaintiff 
 and there is no suggestion of bad faith ; it did not receive the money 
 as the plaintiff's agent or in his behalf; it was received in its own 
 right as the assignee of the chose in action. An action for money had 
 and received lies to recover money which should not in justice be re- 
 tained by the defendant and which in equity and good conscience 
 should be returned to the plaintiff. The right to recover does not de- 
 pend upon privity of contract, but on the obligation to restore that 
 which the law imphes should be retuYned, where one is unjustly en- 
 riched at another's expense. Claflin v. Godfrey, 21 Pick. 1, 6; Far- 
 mer V. Arundel, 2 Wm. Bl. 824. 
 
 As the money was received from the debtors by the defendant as it.i 
 own, in good faith, without notice of the prior assignment, under an 
 instrument duly executed and for a good consideration purporting to 
 assign the accounts receivable, the plaintiff cannot recover in this ac- 
 tion. Cole v. Bates, 186 Mass. 584, 72 N. E. 333 ; Lawrence v. Batch- 
 
 OOBBIN CONT. — 73 
 
1154 ASSIGNMENT (Ch. 7 
 
 eller,'13f Mass. 504; Rand v. Smallidge, 130 Mass. 337;' Moore v. 
 Moore, 127 Mass. 22. . : ' 
 
 We therefore do not consider it necessary to discuss the question 
 whether the plaintiff comes within the rule established in this common- 
 wealth that, as between competing assignees assignnients of a chose in 
 action take precedence according to their dates and not according to 
 the time when notice is given to the debtor; the earlier assignment 
 being good against the subsequent one, though no notice is given the 
 debtor (Thayer v. Daniels, 113 Mass. 129, 131, Putnam v. Storey, 132 
 Mass. 205), or within the exceptions to the rule where, by his own acts 
 or conduct, the earher assignee has been prevented from recovering. 
 As bearing on this point, see Bridge v. Connecticut Mutual Life In- 
 surance Co., 152 Mass. 343, 25 N. E. 612. Nor is it necessary to de- 
 cide what rights, if any, the plaintiff has • against the debtors. See 
 Hellen v. Boston, 194 Mass, 579, 80 N. E. 603. 
 
 Exceptions overruled.^* 
 
 KING BROS. & CO. y. CENTRAL OF GEORGIA RY. CO. et al. 
 (Supreme Court of Georgia, 1910. 135 Ga. 225, 69 S. B. 113.) 
 
 Action by the Traders' Investment Company against the Central of 
 Georgia Railway Corhpany and King Bros. & Co. Judgment for plain- 
 tiff, and defendants King Bros. & Co. bring error. Reversed. 
 
 Evans, P. J. An employe of the Central of Georgia Railway Com- 
 pany assigned to the Traders' Investment Company a stated amount, 
 less than the whole, of the salary earned by him at the time of the as- 
 sigrmient. Subsequently, for value and without notice of the prior 
 partial assignment, the employe assigned his entire salary which he 
 had earned to King Bros. & Co. The railroad company refused to 
 pay the first assignees, and suit was instituted by them against the rail- 
 road company, the employe, and the subsequent assignees. The rail- 
 road company admitted the indebtedness, and paid the money into 
 court, and the court awarded it, after deducting the costs, to the first 
 assignee. The only point involved is the prior rights of the two as- 
 signees to the fund. 
 
 In the first assignment the assignor transferred a stated portion of 
 the fund, by virtue of which the assignee acquired no separate and 
 distinct part, but only an equitable interest, in the whole fund to the 
 extent of the interest assigned. Fidelity Co. v. Exchange Bank, 100 
 Ga. 619, 28 S. E. 393; W. & A. R. Co. v. Union Investment Co., 128 
 Ga. 74, 57 S. E. 100. A partial assignment of a chose in action will 
 not vest in the assignee such a title to the portion assigned as can be 
 enforced in action at law without the consent of the debtor. Such an 
 assignment is, however, enforceable in equity, though the debtor may - 
 
 28 In accord : Judson v. Corcoran, 17 How. 612, 15 L. Ed. 231 (1854) ; In re 
 Hawley Down-Draft Furnace Co. (D. C.) 233 Fed! 451 (1916)." 
 
Ch. 7) ASSIGNMENT II55 
 
 not assent, if all the parties at interest are before the court, so that the 
 rights of each in the fund may be determined in one suit and settled 
 by one decree. Rivers v. Wright, 117 Ga. 81, 43 S. E. 499. 
 
 The second assignment is of the entire chose in action, and vests in 
 the ^assignee the legal title to the whole chose in action. Civ. Code 
 1895, § 3077. The second assignee had no notice of the prior partial 
 assignment, nor did the debtor assent to tlie partial assignment of the 
 chose. The contest for priority in payment, therefore, is between the 
 holder of an equitable right to be paid a stated sum from the chose in 
 action, and a subsequent bona fide assignee for value, who has the le- 
 gal title to the whole chose. This priority cannot be determined by the 
 order of the time of execution of the respective assignments, because 
 the doctrine of "qui prior est tempore potior est jure" only applies as 
 Ibetween persons having equitable interests, where such interests are 
 in all other respects equal. It is only where the' interests assigned are 
 equitable in their nature, and the equity of no assignee is intrinsically 
 superior to the others, that the order of time determines the order of 
 priority. Where the subsequent assignee has acquired the legal title 
 for a valuable consideration and without notice of the prior equitable 
 assignment, he is protected. 2 Pomeroy's Eq. Jur. § 713. The rela- 
 tion of the holder of the legal title under such circumstances is that 
 of a bona fide purchaser, and his title is not affected by a latent equi- 
 ty. The court erred in awarding the fund to the holder of the equita- 
 ble assignment. 
 
 Judgment reversed. All the Justices concur.^* 
 
 ANDREWS ELECTRIC CO., Inc., v. ST. ALPHONSE CATHO- 
 LIC TOTAL ABSTINENCE SOC. et al. 
 (Supreme Judicial Court of Massachusetts, 1919. 233 Mass. 20, 123 N. E. 103.) 
 
 Action by the Andrews Electric Company, Incorporated, against the 
 St. Alphonse Catholic Total Abstinence Society and others. On re- 
 port to the Supreme Judicial Court. -Decree directed for plaintiff. 
 
 Pierce, J. The plaintiff in 1915 was employed as a subcontractor 
 on a building erected for the defendant St. Alphonse Catholic Total 
 Abstinence Society. The contractor was the defendant James Shields. 
 The defendant Ovide V. Fortier is the trustee in bankruptcy of the 
 estate of Shields. At the completion of the work of the plaintiff, 
 Shields owed it $223. It requested Shields to make payment of the 
 debt due, and he thereupon delivered to it the following order upon 
 the society: 
 
 "St. Alphonse Total Abstinence Society, Gentlemen : Kindly pay to 
 Andrews Electric, Inc., the sum of $223 out of the amount coming to 
 
 ; 
 
 2 In accord: Pickett v. School District, 193 Mo. App. 519, 186 S. W. 533 
 (1916). See note, Ann. Cas. 1912A, 672. 
 
1156 ASSIGNMENT (Ch. 7 
 
 me on my contract with the society, same being the balance due them 
 on wiring contract. James Shields." 
 
 Before March 9, 1916, the plaintiff delivered this order to one Bar- 
 low, an architect employed by the society and the architect on the 
 building in question. On March 9, 1916, the plaintiff wrote to the 
 treasurer of the society a letter wherein it was stated that "he 
 [Shields] has given us an order on his account with you for the bal- 
 ance, thus releasing any claim he may have on so much of the balance 
 due on the building due him as will satisfy our bill, namely, $223. 
 This order has been handed to Mr. Barlow." 
 
 When the order was delivered through Barlow to the society it 
 claimed certain deductions froni the balance of the contract price 
 for the work done by Shields, because of defective work, and it was 
 therefore uncertain what amount if any was due Shields. The order 
 was never in fact accepted. Upon an adjustment of the account in 
 March, 1918, under authority of the bankruptcy court it was agreed 
 that the society owed Shields $419 when the order was given to the 
 plaintiff. 
 
 The order was a good assignment between the parties. Richard- 
 son V. White, 167 Mass. .58, 44 N. E. 1072. It was given in considera- 
 tion of a pre-existing debt, was drawn upon a specific fund identified 
 by the order itself, was delivered to the payee and notice thereof was 
 given to the debtor. Putnam v. Story, 132 Mass. 205, 212 ; Holbrook 
 V. Payne, 151 Mass. 383, 24 N. E. 210, 21 Am. St. Rep. 456. 
 
 Shields was adjudicated a voluntary bankrupt on January 25, 1917. 
 There is nothing in the agreed stateflient of facts to show Shields had 
 any other creditor than the plaintiff when the order was given it, and 
 the existence of creditors on March 9, 1916, cannot be inferred from 
 the fact that Shields was bankrupt on January 25, 1917. The assign- 
 ment appears to have been made in good faith, it did not affect the 
 rights of creditors and was made more than four months before the 
 commencement of bankruptcy proceedings. An assignment of the. 
 whole fund made under these circumstances is good between the par- 
 ties and against the trustee in bankruptcy of the assignor. Bridge v. 
 Kedon, 163 Cal. 493, 126 Pac. 149, 43 L. R. A. (N. S:) 404; Stewart v. 
 Piatt, 101 U. S. 731, 25 L. Ed. 816; Sawyer v. Turpin, 91 U. S. 
 114, 23 L. Ed. 235. 
 
 An assignment of part of the fund against the consent of the drawee 
 is void at law because the partial assignor is not an attorney with pow- 
 er to sue in the assignor's name and because "a debtor is not to have 
 his responsibilities so far varied from the terms of his origined con- 
 tract as to subject him to distinct demands on the part of several per- 
 sons, when his contract was one and entire." Gibson v. Cooke, 20 
 Pick. 15, 32 Am. Dec. 194; Palmer v. Merrill, 6 Cush. 282, 52 Am. 
 Dec. 782; Papineau v. Naumkeag, 126 Mass. 372; Mandeville v. 
 
Ch.7) 
 
 ASSIGNMENT 
 
 1157 
 
 Welch, 5 Wheat. (U. S.) 277, 286, 5 L. Ed. 87.»o In equity, however, 
 the objections to a partial assignment disappear. All persons in inter- 
 est can be brought before the court in a single suit and a decree can 
 be entered which will protect the rights of all parties concerned. Na- 
 tional Exchange Bank v. McLoon, 73 Me. 498, 40 Am. Rep. 388. 
 
 The question at issue has never been directly decided in this com- 
 monwealth, but inferentially the decisions are in accord with the very 
 great weight of authority in England and the United States in the 
 support of the legal statement that such an assignment is valid in equity 
 without the assent of the dettor, trustee or stakeholder; and we are 
 of opinion that such is the true rule and should be followed in this 
 commonwealth. PutnaiTi v. Story, supra; James v. Newton, 142 
 Mass. 366, 8 N. E. 122, 56 Am. Rep. 692 ; Richardson v. White, su- 
 pra; Kingsbury v. Burrill, 151 Mass. 199, 24 N. E. 36; Nashua Sav- 
 ings Bank v. Abbott, 181 Mass. 531, 63 N. E. 1058, 92 Am. St. Rep. 
 430; Security Bank of New York v! Callahan, 220 Mass. 84, 107 N. 
 E. 385; Row v. Dawson, 1 Ves. Sr. 331; Ex parte Moss, 14 Q. B. 
 D. 310; Percival v. Dunn, 29 Ch. D. 128; Trist v. Child, 21 Wall 
 441, 22 L. Ed. 623; Peugh v. Porter, 112 U. S. 7Z7, 5 Sup. Ct. 361, 28 
 L. Ed. 859; Fourth Street Bank v. Yardley, 165 U. S. 634, 17 Sup. 
 Ct. 439, 41 L. Ed. 855 ; Nat. Exchange Bank v. McLoon, supra; Ris- 
 ley v. Phenix Bank, 83 N. Y. 318, 38 Am. Rep. 421 ; Appeals of Phil- 
 adelphia, 86 Pa. 179 ; Bower v. Hadden Blue Stone Co., 30 N. T- Eq 
 171."^ 
 
 The assignment being valid in equity and not void as in fraud of 
 creditors or as contravening the Bankruptcy Act (U. S. Comp. St. §§ 
 9585-9656) the trustee took subject to it. Bridge v. Kedon, supra; 
 Fletcher v. Morey, 2 Story, 555, Fed. Cas. No. 4864; Parker v. Mug- 
 gridge, 2 Story, 334, Fed. Cas. No. 10743 ; In re Hanna (D. C.) 105 
 Fed. 587. 
 
 It follows that a decree should be entered that the St. Alphonse 
 Catholic Total Abstinence Society pay the plaintiff from SEad fund of 
 $419 the sum of $223, with interest thereon from the filing of the bill, 
 and the balance of the fund to the trustee in bankruptcy. 
 
 Decree accor4ingly. 
 
 80 See, also, Sheatz v. Markley, 249 Fed. 315, 161 0. 0. A. 323 (1918) ; John 
 A. Sehmitt's Sons v. Shadraeh, 251 Fed. 874, 164 C. O. A. 90 (1918). 
 
 »i Also In accord: Escanaba Traction Co. v. Burns, 257 Fed. 898, 904, 169 
 C. 0. A. 48 (1919) ; Field v. Mayor, etc., of City of New York, 6 N. Y. 179, 57 
 Am. Dec. 435 (1852) ; Palmer v. Palmer, 112 Me. 149, 91 Atl. 281 (1914). If 
 all the claimants join as plaintiffs, the debtor cannot object to a partial as- 
 signment. Whittemore v. Judd Linseed & Sperm Oil Co., 124 N. Y. 565, 27 N. 
 E. 244, 21 Am. St. Rep. 708 (1891); Mclnnis Lumber Co. v. Rather, 111 
 Miss. 55, 71 South. 264 (1916). See, also, Carvill v. Mirror Films, 98 Misc. 
 Rep. 650, 163 N. Y. Supp. 268 (1917), 26 Yale L. Jour. 792; Skipper v. Hol- 
 loway (1909) 26 T. L. R. 82, 23 Harv. L. Rev. 307. 
 
1158 ASSIGNMENT (Gh. 7 
 
 DEVUN V. MAYOR, ETC., OF CITY OP NEW YORK et al. 
 (Court of Appeals of New York, 1875. 63 N. Y. 8.) 
 
 This action was brought by plaintiff, as assignee of an interest in a 
 contract, made between the corporation of the city of New York and 
 one Andrew J. Hackley, under the act (chap. 309, Laws of 1860) for 
 cleaning the streets of said city. The other defendants, it was alleged, 
 claimed interest in the contract, but refused to join as plaintiffs. 
 
 By the contract, which was made February 26th, 1861, the con- 
 tractor agreed to sweep all the paved streets, avenues, lanes, alleys, 
 etc., in said city at least once a week, Broadway once every twenty- 
 four hours, and some other streets specified twice a week for the term 
 of five years, and to immediately remove the sweepings. * * * 
 
 AtLEN, J.'^ The referee has found the making of the contract as 
 alleged, the performance thereof by Hackley, from the making there- 
 of in February, 1861, until May, 1863, an ability, readiness and offer 
 by him to perform the contract for the unexpired term thereof, afid 
 that he was, in May, 1863, without cause, ejected by the respondents 
 from the work, and by them^ prevented from, proceeding in the per- 
 formance of the agreement. He has also found the amount due and 
 unpaid for work actually done at the time of the interference by the 
 respondents, and the damages sustained by the parties in interest by 
 reason of the breach of the contract by the respondents. * * *^ 
 
 Upon the adjudged facts the plaintiff and the defendants, appel- 
 lants, the assignees of Hackley were entitled to recover unless there 
 is some legal impediment, and were entitled to retain the judgment 
 given by the referee, unless for some reason no action at law could 
 be maintained for the work actually performed, or upon the agreement 
 for a breach thereof, or some material error was committed by the 
 referee upon the trial to the prejudice of the respondents. 
 
 But t\|p objections to the recovery against the city, the present de- 
 fendant,, were considered by the court below in the opinion annexed 
 to the record before us, and they being regarded as insuperable and 
 fatal to the action, the judgmient of the referee was reversed and judg- 
 ment absolute given for the city. These objections were : First, that 
 the contract between the city and Hackley was not assignable, and 
 that the assignment by the original contractor, of itself, terminated 
 the contract and justified the action of the city authorities in ref^jsing 
 longer to be bound by it. * * * 
 
 The question, however, whether the assignment by the original 
 contractor terminated the contract, or authorized the refusal of the 
 city longer to be bound by it, still remains to be considered, as the 
 waiver has not been found by the referee. An assignment by the con- 
 tractor of the amounts which would have become due from the city 
 from time to time, made before the doing of the work or the perform- 
 
 3 2 Parts of the opinion are omitted and the statement of facts Is condensed. 
 
Ch. 7) ASSIGNMENT 1159 
 
 ance of the conditions upon which the payments depended, would, 
 under the Hberal rule permitting the assignment of choses in action 
 now prevailing, be valid. Expectancies, as well as existing rights of 
 action, may be assigned, and the rights of the assignees will be pro- 
 tected and enforced at law. Field v. Mayor, etc., 6 N. Y. 179, 57 Am. 
 Dec. 435; Hall v. Bufifalo., 2 Abb. Dec. 301. An assignment may 
 include all contingent and incidental benefits or results of an execu- 
 tory contract, as well as the direct fruits or earnings under it, and 
 thus entitle the assignee to the damages resulting from a violation of 
 its terms. The right of action for a breach* of the contract, resulting 
 in pecuniary loss to the contractor, would survive to the personal 
 representatives of the aggrieved party, and that is one test of the 
 assignability of contracts and choses in action. Byxbie v. Wood, 24 
 N. Y. 607; McKee v. Judd, 12 N. Y. 622, 64 Am. Dec. 515 ; Zabriskie 
 v. Smith, 13 N. Y. 322, 64 Am. Dec. 551. In principle it would not 
 impair the rights of the assignee, or destroy the assignable quality 
 of the contract or claim, that the assignee, as between himself and the 
 assignor, has assumed some duty in performing the conditions pre- 
 cedent to a perfected cause of action, or is made the agent or sub- 
 stitute of the assignor in the performance of the contract. If the 
 service to be rendered or the condition to be performed is not neces- 
 sarily personal, and such as can only with due regard to the intent of 
 the parties, and the rights of the adverse party, be rendered or per- 
 formed by the original contracting party, and the latter has not dis- 
 qualified himself from the performance of the contract, the mere fact 
 that the mdividual representing and acting for him. is the assignee, 
 and not the mere agent or servant, will not operate as a rescission of, 
 or constitute a cause for terminating the contract. Whether the 
 agent for performing the contract acts under a naked power, or a 
 power coupled with an interest, cannot affect the character or vary 
 the effect of the delegation of power by the original contractor. 
 Hackley, the original contractor, was at no time discharged fromi his 
 obligations to the city, nor was he disqualified for the performance 
 of the contract, ^= but was at all times in a position to perform his part 
 of this agreement, facts which distinguish this case from Stevens v. 
 Benning, 6 De G.," M. & G. 223, and Robson v. Drummond. 2 Barn. & 
 
 Ad. 303. m ' i , j 
 
 Stevens v. Benning is distinguished from the present by the ad- 
 ditional circumstances that the contract in the case cited was in 
 its nature personal, and was made in reference to the character and 
 facilities of the contracting firm as a publishing house, and was in 
 
 33 An asfsignment is not a novation, even though the other party to the con- 
 tract assents to the assignment, ^nd the assignor escapes none of his con- 
 tractual duUes by the^ assignment. See Houston ^- ^^™«"' ^^ O^" ,^4"^ 
 Pap 6t<) fl918) ■ Haag & Bro. v. Beichert, 142 Ky. 298, 134 S. W. 191 (1911) , 
 McFarlLd'v.'Mkyo (Okl.) 162 Pac. T53 L R. A. 19170 901 (l^f); Granite 
 Building Corporation v. Bubin, 40 R. I. 208, 100 Atl. 310, L. B. A. 1917D, 84o 
 (1917). See, also, chapter V, Discharge of Contract. 
 
1160 ASSIGNMENT (Ch. 7 
 
 the nature of a partnership in so far as it provided for a division of 
 the profits of the work to be published. In Robson v. Druminond the 
 defendant had agreed to pay annually in advance for the use of the 
 carriage to be furnished by Sharpe, a coachmaker, and was not bound, 
 after notice of his withdrawal from and assignment of the contract to 
 Robson, to trust to the ability or integrity of the assignee; and the 
 court also held that the contract was one for the personal service of 
 Sharpe, and that the defendant was entitled to his judgment and taste 
 to the end of the contract. It is not disputed that in all. cases when 
 the executor or administrator would succeed to the rights and lia- 
 bilities of a deceased party to a contract, the contract is assignable by 
 the act of the parties, the personal representatives of a decedent being 
 regarded but the legal- assignee upon whom the law devolves the 
 rights and obligations of their testator or intestate. In one case in 
 which the executory obligations of deceased parties have been sought 
 to be enforced against their personal representative, the question has 
 been said to be one of construction depending upon the intention of 
 the parties, and that we are without any well-defined rule on the sub- 
 ject. Dickinson v. Calahan's Admrs., 19 Pa. 227. In some cases in 
 which executors and administrators have assumed the contracts of 
 their testators or intestate, and after performance sought to recover 
 the stipulated compensation, the question has been one of pleading 
 rather than of principle. Edwards v. Grace, 2 M. & W. 190. 
 
 The assignability of a contract must depend upon the nature of the 
 contract and the character of the obligations assumed rather than the 
 supposed intent of the parties, except as that intent is exp'ressed in 
 the agreement. Parties may, in terms, prohibit the assignment of any 
 contract and declare that neither personal representatives nor as- 
 signees shall succeed to any rights in virtue of it, or be bound by its 
 obligations. But when this has not been declared expressly or by im- 
 plication, contracts other than such as are personal in their character, 
 as promises to marry or engagements for personal services requiring 
 skill, science or peculiar qualifications, may be assigned, and by them 
 the personal representatives will be bound. In Hyde v. Windsor, 
 Cro. Eliz. 552, it was said that executors are bound by all covenants 
 ot their testator, whether named or not, "unless it be such a covenant 
 as is to be performed by the person of the testator, w^ch they cannot 
 perform." If the contract be personal' and the performance of the 
 party himself be the essence thereof, it neither devolves upon his rep- 
 resentatives, nor can it be assigned. White's Ex'rs v. Commonwealth, 
 39 Pa. 167. When the contract is executory in its nature, and an 
 assignee or personal representative can fairly and sufficiently execute 
 all that the original contractor could have done, the assignee or rep- 
 resentative may do so and have the benefit of the contract. Quick v. 
 Ludbaum, 3 Bulst. 30, adjudged a contract to build a house binding 
 upon the executors. This case has been criticised, and sometimes its 
 authority questioned, but the modern cases in England and the deci- 
 
Ch. 7) ASSIGNMENT ' 1161 
 
 sions of the courts of this State are in hannony with it, It is cited 
 with approval in Siboni v. Kirkman, 1 M. & W. 417, and in many 
 other cases. 
 
 The act of God in the death of the party does not dissolve the 
 contract or excuse performance, except in the case of a contract 
 requiring personal service, and then the law will imply an excep- 
 tion. In the case last referred to executors were held entitled to 
 enforce a contract for the exchange of pianos made by their testa- 
 tor twenty years before the, bringing of the action. There may be 
 cases in which the executor may not be compellable to performs 
 contract of his testator, and yet may elect to do so and entitle himself, 
 in his representative capacity, to the compensation. Marshall v. 
 Broadhurst, 1 Cr. & J. 403, 1 Tyrwhitt, 348, wis for work and ma- 
 terials in ;building a house which the testator of plaintiff had agreed 
 to build, but died befqre the work, was begun and the plaintiffs wert 
 held entitled to recover. The court say, that in case of such a con- 
 tract, if the executors do not go on they will be liable to damages 
 for not completing the work, and if they go on they may recover as 
 executors. See, also, Wentworth v. Cock, 10 A. & E. 42. In the 
 latter case Pattison, J., refers to a case at Liverpool where a contract 
 to build a light-house was held to. be personal, and therefore not 
 assignable, but solely on the ground of its being a matter of personal 
 skill and science, clearly implying that but for that element in the con- 
 tract it wpuld have been assigriable. Sears v. Conover, 34 Barb. 331, 
 was not unlike Wentworth v. Cock, except that the action was an 
 action by the assignee of an executory contract for non-performance 
 by the other party. 
 
 Within the principle of the adjudications in this State this con- 
 tract was assignable. The executor of the contract would have 
 been bound to perform it to entitle him to recover what had been 
 earned, and to prevent an action for non-performance. It was a 
 contract not capable of being performed in person by Hackley. At 
 most, he could only employ workmen and appoint agents and over- 
 seers of.the -yvprki The work did , not require or call for; the exer- 
 cise of any peculiar skill, science or experience. It was by law all to 
 be done under the directions of the city inspector, who may be sup- 
 posed to have been in possession of all the local knowledge and ex- 
 perience essential to the general direction of the work. It was mere- 
 ly the servile labor of sweeping and cleaning the streets, and re- 
 moving the garbage as specified in the agreement and under the 
 general supervision of the city inspector, that the contractor engaged 
 for. 
 
 Work upon the canals of this State, either in their repair or con- 
 struction, calls for more of skill and scientific knowledge, as well 
 as of experience, than this work could call for, and yet contracts for 
 that class of work have been recognized as assignable by the legisla- 
 ture and by the courts, and the rights of assignees protected and en- 
 
1162 ASSIGNMENT (Ch. 7 
 
 forced. Munsell v. L,ewis, 2 Denio, 224. So contracts for the labor 
 of convicts in the State prisons have been expressly held assignable, 
 and on the ground that notwithstanding the intimate personal rela- 
 tions that must exist between the contractor and the convict laborers, 
 and their presence at all times within the prison walls, and their op- 
 portunities of interfering with the discipline of the prison, the contract 
 is not personal in its character. There the general discipline and 
 government of the prison and the prisoners was with the warden and 
 other officers, while here, so far as any judgment or discretion is to 
 be exercised, it was with the city inspector. The circumstance that 
 by the statute in this case the contract was to be awarded as the com- 
 mon council should deem for the best interests of the city, does not 
 distinguish this case from those referred to. This provision did not 
 refer to the person of the contractor, but to the terms of the contract. 
 It was not Intended to enable the common council to be a respecter 
 of persons and to give the contract to favorites, but to give therri a ' 
 discretion to choose between different proposals, relieving the au- 
 thorities from the necessity of awarding the contract to the lowest 
 bidder irrespective of the terms of the contract, the security ofifered, 
 or the fairness or sufficiency of the compensation to insure perform- 
 ance with reasonable certainty. This statutory provision does not 
 change the character of the work or import into the contract any 
 unusual terms, or destroy its assignability. The assignment of the 
 contract and the interest of the contractor under it did not terminate 
 the agreement or authorize its rescission or abandonment by the 
 city. * * * 
 
 All concur. 
 
 Judgment accordingly.^* 
 
 BRITISH WAGON CO. et al v. LEA & CO. 
 (In the Queen's Bench Division, 1880. 5 Q. B. Div. 149.) 
 
 The judgment of the Court (Cockburn, C. J., and ManisTy, J.) 
 was delivered by. 
 
 Cockburn, C. J. This was an action brought by the plaintiffs to 
 recover rent for the hire of certain railway wagons, alleged to be 
 payable by the defendants to the plaintiffs, or one of them, under 
 the following circumstances : 
 
 By an agreement in writing of February 10th, 1874, the Park- 
 
 3* In the following cases personal performance by the assignor was held not 
 to be a condition precedent, and performance by the assignee made the as- 
 signed right enforceable by him : Corvallis & A. K. R. Ck). v. Portland E. & 
 E. B. Co., 84 Or. 524, 163 Pac. 1173 (1917) ; Liberty Wall Paper Co. v. Stoner 
 Wall Paper Mfg. Co., 59 App. Div. 858, 69 N. Y. Supp. 855, affirmed 170 N. x. 
 582, 63 N. E. 1119 (1901) ; La Rue v. Groezinger, 84 Cal. 281, 24 Pac. 42, IS 
 Am. St. Rep. 179 (1890). See, also, Rochester Lantern Co. v. Stiles & Parlcer 
 Co., 135 N.Y. 209, 31 N. B. 1018 (1892). 
 
Ch. 7) ASSIGNMENT 1163 
 
 gate Wagon- Company let to the defendants, who are coal merchants, 
 fifty railway wagons for a term of seven years, at a yearly rent of 
 £600 a year, payable by equal quarterly payments. By a second 
 agreement of June 13th, 1874, the company in like manner let to 
 the defendants fifty other wagons, at a yearly rent of £625, payable 
 quarterly like the former. 
 
 Each of these agreements contained the following clause: "The 
 owners, their executors, or administrators, will at all times during 
 the said term, except as herein provided, keep the said wagons in 
 good and .substantial repair and working order, and, on receiving no- 
 tice from the tenant of any want of repairs, and the number or num- 
 bers of the wagons requiring to be repaired, and the place or places 
 where it or they then is or are, will, with all reasonable despatch, 
 cause the same to be repaired and put into good working order." 
 
 On October 24th, 1874, the Parkgate Company passed a resolu- 
 tion, under the 129th section of the Companies Act, 1862, for the 
 voluntary winding up of the company. Liquidators were appointed 
 and by an order of the Chancery Division of the High Court of Jus- 
 tice, it was ordered that the winding up, of the company should be 
 continued under the supervision of the Court. , 
 
 By an indenture of April 1st, 1878, the Parkgate Company assign- 
 ed and transferred, and the liquidators confirmed to the British 
 Company and their assigns, among other things, all sums of money, 
 whether payable by way of rent, hire, interest, penalty, or damage, 
 then due, or thereafter to become due, to the Parkgate Company, by 
 virtue of the two contracts with the defendants, together with the 
 benefit of the two contracts, and all the interest of the Parkgate Com- 
 pany and the said liquidators therein; the British Company, on the 
 other hand covenanting with the Parkgate Company "to observe and 
 perform such of the stipulations, conditions, provisions, and agree- 
 ments contained in the said contracts as,, according to the terms 
 thereof were stipulated to be observed and performed by the Park- 
 gate Company." On the execution of this assignment the British 
 Company took over from the Parkgate Company the repairing sta- 
 tions, which had previously been iised by the Parkgate Company 
 for the repair of the wagons let to the defendants, and also the staff 
 of workmen employed by the latter company in executing such re- 
 pairs. It was expressly found that the British Company have 
 ever since been ready and willing to execute, and have, with all due 
 diligence, executed all necessary repairs to the said wagons. This, 
 however, they have done under a special agreement come to between 
 the parties since the present dispute has arisen, without prejudice to 
 their respective rights. 
 
 In this state of things the defendants asserted their right to treat 
 the contract as at an end, on the ground that the Parkgate Company 
 had incapacitated themselves from performing the contract, first, 
 by going into voluntary liquidation; secondly, by assigning the 
 
1164 ASSIGNMENT (Ch. 7 
 
 contracts, and givinyf up the repairing stations to the British Com- 
 pany, between whom and the defendants there was no privity of 
 contract, and whose services, in substitution for those to be per- 
 formed by the Parkgate Company under the contract, they the de- 
 fendants were not bound to accept. The Parkgate Company not ac- 
 quiescing in this view, it was agreed that the facts should be stated 
 in a special case for the opi'nion of this Court, the use of the wagons 
 by the defendants being in the meanwhile continued at a rate agreed 
 on between the parties, without prejudice to either, with reference 
 to their respective rights. 
 
 The first ground taken by the defendants is in our opinion alto- 
 gether untenable in the present state of things, whatever it may be 
 when the affairs of the company shall haVe been wound up, and the 
 company itself shall have been dissolved under the 111th section of 
 the Act. Pending the wiriding-up, the company is by the effect of 
 §§ 95 and 131 kept alive, the liquidator having power to carry on 
 the business, "so far as may be necessary for the beneficial winding- 
 up of the company," which the continued letting of these wagons, 
 and the receipt of the rent payable in respect of them, would, we 
 presume, be.^' 
 
 What would be the position of the parties on the dissolution of 
 the company it is unnecessary for the present purpose to consider. 
 ■ The main contention on the part of the defendants, however, was 
 that, as the Parkgate Company had, by assigning the contracts, and 
 by making over their irepairing stations to the British Company, in- 
 capacitated themselves to fulfil their obligation to keep the wagons 
 in repair, that company had no i"ight, as between thettiselves and the 
 defendants, to substitute a third party to do the work they had en- 
 gaged to perform, nor were the defendants bound to adcept the par- 
 ty so substituted as the one to whom they were to look for per- 
 formance of the contract; the contract was therefore at an end. 
 
 The authority principally relied on in support of this contention 
 was the case of Robson v. Drumrriond (2 B. & Ad. 303), approved 
 of by this Court in Humble v. Hunter (12 Q. B. 310). In Robson 
 V. Drummond a carriage having been hired by the defendant of one 
 Sharp, a co,achmaker, for five years, at a yearly rent, payable in ad- 
 vance each year, the carriage to be kept in repair and painted once 
 a year by the maker — Robson being then a partner in the business, 
 but unknown to the defendant — on Sharp retiring from the business 
 after three years had expired, and making over all interest in the 
 business and property in the goods to Robson, it was held, that the 
 defendant could not be sued on the contract — ^by Lord Tenterden 
 
 ">> Suppose the Parkgate Company had. been dissolved and its assets dis- 
 tributed; could the British Company continue performance and enforce the 
 assigned right to payment? See Tolhurst's Case, [1902] 2 K. B. 660 (1902) ; 
 Detroit T. & I. R. Co. v. Western Union Tel. Co., 200 Mich. 2, 166 N. W. 494 
 (1918). 
 
Ch. 7) ASSIGIjfMENT 1165 
 
 on the ground that "the defendant might have been induced to en- 
 ter into the contract by reason of the personal confidence which he 
 reposed in Sharp, and therdore might have agreed to pay money 
 in advance, fbr which reason the defendant had a right to, object to 
 its being performed by any other person;" and by Littledale and 
 Parke, JJ., on the additional ground that the defendant had a right 
 to the personal services of Sharp, and to the benefit of his judgment 
 and taste, to the end of the contract. 
 
 In like manner, where goods are ordered of a particular manufac- 
 turer, another, who has succeeded to his business, cannot execute the 
 order, so as to bind the customer, who has not been made aware 
 of the transfer of the business, to accept the goods. The latter is 
 entitled to refuse to deal with any other than the manufacturer 
 whose goods he intended to buy. For this Boulton v. Jones (2 H. 
 & N. 564) is a sufficient authority. The case of Robson v. Drum- 
 mond comes nearer to the present case, but is, we think, distinguish- 
 able from it. We entirely concur in the principle on which the deci- 
 sion in Robson v. Drummond rests, namely, that where a person 
 contracts with another to dp work or perform service, and it can 
 be inferred that the person employed has been selected with refer- 
 ence to his individual skill, competency, or other personal qualifica- 
 tion, the inability or unwillingness of the party so employed to ex- 
 ecute the work or perform the service is a sufficient answer to any 
 demand by a stranger to the original contract of the performance. 
 of it by the other party, and entitles the latter to treat the contract 
 as at an end, notwithstanding that the person tendered to take the 
 place of the contracting party may be equally well qualified to do 
 the service. Personal performance is in such a case of the essence 
 of the contract, which, consequently, cannot in its absence be en- 
 forced against an unwilling party. But this principle appears to us 
 inapplicable in the present instance, inasmuch as we cannot sup- 
 pose that in stipulating for the repair of these wagons by the com- 
 pany — a rough description of work which ordinary workmen con- 
 versant with the business would be perfectly able to execute — ^the de- 
 fendants attached any importance to whether the repairs were done 
 by the company, or by any one with whom the company might en- 
 ter into a subsidiary contract to do the work. All that the hirers, 
 the defendants, cared for in this stipulation was that the wagons 
 should be kept in repair; it was indifferent to them by whom the 
 repairs should be done. Thus if, without going into liquidation, or 
 assigning these contracts, the company had entered intp a contract 
 with any competent party to do the repairs, and so had procured 
 them to be done, we cannot think that this would have been a de- 
 parture from the terms of the contract to keep the wagons in re- 
 pair. While fully acquiescing in the general principle just referred 
 to, we must take care not to push it beyond reasonable limits. And 
 we cannot but think that, in applying the principle, the Cpurt of 
 
1166 ASSIGNMENT (Ch. 7 
 
 Queen's Bench in Robson v. Drummond went to the utmost length 
 to which it can be carried, as it is difficult to see how in repairing a 
 carriage when necessary, or painting it once a year, preference would 
 be given to one coachmaker over anqther. Much work is contracted 
 for, which it is known can only be executed by means of subcon- 
 tracts; much is contracted for as to which it is indifferent to the 
 party for whom it is to be done, whether it is done by the immediate 
 party to the contract, or by some one on his behalf. In all these 
 cases the maxim "Qui facit per alium facit per se" a;pplies. 
 
 In the view we take of the case, therefore, the repair of the wag- 
 ons, undertaken and done by the British Company under their con- 
 tract with the Parkgate Company, is a sufficient performance by the 
 latter of their engagement to repair under th^ir contract with the 
 defendants. Consequently, so long as the Parkgate Company con- 
 tinues to exist, and, through the British Company, continues to ful- 
 fil its obligation to keep the wagons in repair, the defendants can- 
 not, in our opinion, be heard to say that the former company is not 
 entitled to the performance of the contract by them, on the ground 
 that the 'Company have incapacitated themselves from performing 
 their obligations under it, or that, by transferring the performance 
 thereof to others, they have absolved the defendants from further 
 performance on their part. 
 
 That a debt accruing due under a contract can, since the passing 
 of the Judicature Acts, be assigned at law as well as equity, cannot 
 since the decision in Brice v. Bannister (3 Q. B. D. 569) be disputed. 
 
 We are therefore of opinion that our judgment must be for the 
 plaintiffs for the amount claimed. 
 
 ARKANSAS VALLEY SMELTING CO. v. BELDEN MIN. CO. 
 
 (Supreme Court of the United States, 1888. 127 V. S. 379, 8 Sup. Ct. 1308, 32 
 
 L. Ed. 246.) 
 
 In Error to the Circuit Court of the United States for the District 
 of Colorado. 
 
 This was an action brought by a smelting company, incorporated by 
 the laws of Missouri, against a mining company, incorporated by the 
 laws of Maine, and both doing business in Colorado by virtue of a 
 compliance with its laws, to recover damages for the breach of a con- 
 tract to deliver ore, made by the defendant with Billing & Eilers, and 
 assigned to the plaintiff. The material allegations of the complaint 
 were as follows : 
 
 On July 12, 1881, a contract in writing was made between the de- 
 fendant of the first part and Billing & Eilers of the second part, by 
 which it was agreed that the defendant should sell and deliver to Billing 
 & Eilers, at their smelting works in Leadville, 10,000 tons of carbonate 
 lead ore from its mines at Red Cliff, at the rate of at least 50 tons a 
 
Ch. 7), ASSIGNMENT 1167 
 
 day, beginning upon the completion of a railroad from Leadville to 
 Red Cliif, and continuing until the whole should have been delivered, 
 and that "all ore so delivered shall at once, upon the delivery thereof, 
 become the property of the second party;" and it iVas further agreed 
 as follows: "The value of said ore and the price to be paid therefor 
 shall be fixed in lots of about one hundred tons each; that is to say, 
 as soon as such a lot of ore shall have been delivered to said second 
 party, it shall be sampled at the works of said second party, afld the 
 sample assayed by either or both of the parties hereto, and the value of 
 such lots of ore shall be fixed by such assay ; in case the parties hereto 
 cannot agree as to such assay, they shall agree upon some third dis- 
 interested and competent party, whose assay shall be final. The price 
 to be paid by said second party for such lot of ore shall be fixed on the 
 basis hereinafter agreed upon"by the closing New York quotations for 
 silver and common lead, on the day of the delivery of sample bottle, 
 and so on ufltil all of said ore shall have been deUvered. Said second 
 party shall pay said first party at said Leadville for each such lot of 
 ore at once, upon the determination of its assay value, at the following 
 prices ;" specifying, by reference to the New York quotations, the price 
 to be paid per pound for the lead contained in the ore, and the price 
 to be paid for the silver contained in each ton of ore, varying according 
 to the proportions of silica and of iron in the ore. 
 
 The complaint further alleged that the railroad was completed on 
 November 30, 1881, and thereupon the defendant, under and in com- 
 pliance with the contract, began to deliver ore to Billing & Eilers at 
 their smelting works, and delivered 167 tons between that date and 
 January 1, 1882, when "the said firm of Billing and Eilers was dis- 
 solved, and the said contract and the business of said firm, and the 
 smelting works at which said ores were to be delivered, were sold, 
 assigned, and transferred to G. Billing, whereof the defendant had 
 due notice ;" that after such transfer and assignment the defendant con- 
 tinued to deliver ore under the contract, and between January 1 and 
 April 21, 1882, delivered to Billing at said smelting works 894 tons ; 
 that on May ,1, 1882, the contract, together with the smelting works, 
 was sold and conveyed by Billing to the plaintiff, whereof the defend- 
 ant had due notice ; that the defendant then ceased to deliver ore under 
 the contract, and afterwards refused to perform the contract, and gave 
 notice to the plaintiff that it considered the contract canceled and an- 
 nulled; that all the ore so delivered under the contract was paid for 
 according to its terms ; that "the plaintiff and its said assignors were at 
 all times during their respective ownerships ready, able, and willing 
 to pay on the like terms for each lot as delivered, when and as the 
 defendant should deliver the same, according J:o the terms of said con- 
 tract, and the time of payment was fixed on the day of delivery of. the 
 •sample bottle.' by which expression was, by the custom of the, trade, 
 intended the completion of the assay or test by which the value of the 
 
1168 ASSIGNMENT (Ch. 7 
 
 ore was definitely fixed ;" and that "the said Billing and Eilers, and the 
 said G. Billing, their successor and assignee, at all times since the 
 delivery of said contract, and during the respective, periods when it was 
 held by them respectively,' were able, ready, and willing to and did 
 comply with and perform all the terms of the same, so far as they were 
 by said contract required; and the said plaiiltiff has been at all times 
 able, ready, and willing to perform and comply with the terms thereof, 
 and has frotn time to time, since the said contract was assigned to it, 
 so notified the defendant." 
 
 The defendant demurred to the complaint for various reasons, one 
 of which was that the contract therein set forth could not be assigned, 
 but was personal in its nature, and could not, by the pretended assign- 
 ment thereof to the plaintiff, vest the plaintiff with any power to sue 
 the defendant for the alleged breach of contract. The circuit court 
 sustained the demurrer, and gave judgment for the defendant; and 
 the plaintiff sued out this writ of error. 
 
 Mr. Justice Gray, after stating the facts as above, delivered the 
 opinion of the court. 
 
 If the assignment to the plaintiff of the contract sued on was valid, 
 the plaintiff is the real party in interest, and as such entitled, under 
 the practice in Colorado, to maintain this action in its own name. Rev. 
 St. § 914 (U. S. Comp. St. § 1537); Code Civ. Proc. Colo. § 3; Steel 
 Co. V. Lundberg, 121 U. S. 451, 7 Sup. Ct. 958, 30 L. Ed. 982. The 
 vital question in the case, therefore, is whether the contract between 
 the defendant and Billing & Eilers was assignable by the latter, under 
 the circumstances stated in the complaint. At the present day, no 
 doubt, an agreement to pay money, or to deliver goods, may bei as- 
 signed by the person to whom the money is to be paid or the goods are 
 to be delivered, if there is nothing in the terms of the contract, whether 
 by requiring something to be afterwards done by him, or by some other 
 stipulation, which manifests the intention of the parties that it shall not 
 be assignable. But every one has a right to select and determine with 
 whom he will contract, and cannot have another person thrust upon 
 him without his consent. In the familiar phrase of i Lord Denman, 
 "You have the right to the benefit you anticipate from the character, 
 credit, and substance of the party with whom you contract." Humble 
 V. Hunter, 12 Q. B. 310, 317; Winchester v. Howard, 97 Mass. 303, 
 305, 93 Am. Dec. 93 ; Ice Co. v. Potter, 123 Mass. 28, 25 Am. Rep. 9; 
 King V. Batterson, 13 R. I. 117, 120, 43 Am. Dec. 13; Lansden v. 
 McCarthy, 45 Mo. 106. ^ 
 
 The rule upon this subject, aS applicable to the case at bar, is well 
 expressed in a recent English treatise: "Rights arising out of 
 contract cannot be transferred if they are coupled with liabilities, 
 or if they involve a relation of personal confidence such that the 
 party whose agreement conferred those rights must have intended 
 them to be exercised only by him in whom he actually confided." 
 
Ch. 7) ASSIGNMENT Hgg 
 
 Pol. Cont. (4th Ed.) 425. The contract here sued on was one by which 
 the defendant agreed to deliver 10,000 tons of lead ore from its mines 
 to Billing & Eilers at their smelting works. The ore was to be de- 
 livered at the rate of SO tons a day, and it was expressly agreed that 
 it should become the property of Billing & Eilers as soon as, delivered. 
 The price was not fixed by the contract, or payable upon the delivery 
 of the ore. But, as often as a hundred tons of ore had been delivered, 
 the ore was to be assayed by the parties or one of them, and, if they 
 could not agree, by an umpire ; and it was only after all this had been 
 done, and according to the result of the assay, and the proportions of 
 lead, silver, silica, and iron thereby proved to be in the ore, that the 
 price was to be ascertained and paid. Dliring the time that must elapse 
 between the delivery of the ore and the ascertainment and payment of 
 the price the defendant had no security for its payment, except in the 
 character and solvency of Billing & Eilers. The defendant, therefore, 
 could not be compelled to accept the liability of any other person or 
 corporation as a substitute for the liability of those with whom it had 
 contracted. 
 
 The fact that upon the dissolution of the firm of Billing & Eilers, and 
 the transfer by Eilers to Billing of this contract, together with the 
 smelting works and business of the partnership, the defendant con- 
 tinued to deliver ore to Billing according to the contract, did not oblige 
 the defendant to deliver ore to a stranger, to whom Billing had under- 
 taken, without the defendant's consent, to assign the contract. The 
 change in a partnership by the coming in or the withdrawal of a part- 
 ner might perhaps be held to be within the contemplation of the par- 
 ties originally contracting ; but, however that may be, an assent to such 
 a change in the one party cannot estop the other to deny the validity of 
 a subseqitent assignment of the whole contract to a stranger. The tech- 
 nical nile of law, recqgnized in Murray v. Harway, 56 N. Y. 337, cited 
 for the plaintiff, by which a lessee's express covenant not to assign has 
 been held to be wholly determined by one assignment with the lessor's 
 consent, has no application to this case. The cause of action set forth 
 in the complaint is riot for any f ailtare to deliver ore to Billing before 
 his assignment to the plaintiff, (which might perhaps be an assignable 
 chose in action,) but it is for a refusal to deliver ore to the plaintiff 
 since this assignment. Performance and readiness to perform by the 
 plaintiff and its assignors, during the periods for which they respective- 
 ly held the contract, is all that is alleged ; there is no allegation that 
 BilHng is ready to pay for any ore delivered to the plaintiff. In short, 
 the plaintiff undertakes to step into the shoes of Billing, and to sub- 
 stitute its liability for his. The defendant had a perfect right to de- 
 cline to assent to this, and to refuse to recognize a party, with whom it 
 had never contracted, as entitled to demand further deliveries of ore. 
 The cases cited in the careful brief of the plaintiff's counsel, as tend- 
 CoEBiN Cont 74 
 
1170 ASSIGNMENT (Ch. 7 
 
 ing to support this action, are distinguishable from the case at bar, and 
 the principal ones may be classified as follows : 
 
 First. Cases of agreements to sell and deliver goods for a fixed 
 price, payable in cash on delivery, in which the owner would receive 
 the price at the time of parting with his property, nothing further would 
 remain to be done by the purchaser, and the rights of the seller could 
 not be affected by the question whether the price was paid by the 
 person with, whom he originally contracted or hy an assignee. Sears 
 V. Conover, *42 N. Y. 113, 4 Abb. Dec. 179; Tyler v. Barrows, 29 N. 
 Y. Super. Ct. 104. 
 
 Second. Cases upon the question how far executors succeed to rights 
 and liabilities under a contract of their testator. Hambly v. Trott, 
 Cowp. 371, 375; Wentworth v. Cock, 10 Adol. & E. 42, 2 Perry & D. 
 251 ; 3 Williams, Ex'rs (7th Ed.) 1723-1725. Assignment by operation 
 of law, as in the case of an executor, is quite different from assignment 
 by act of the party ; and the one might be held to have been in the con- 
 templation of the parties to this contract, although the other was not. 
 A lease, for instance, even if containing an express covenant against 
 assignment by the lessee, passes to his executor. And it is by no means 
 clear that an executor would be bound to perform, or would be entitled 
 to the benefit of, such a contract as that now in question. Dickinson v. 
 Calahan, 19 Pa. St. 227. 
 
 Third. Cases of assignments by contractors for public works, in 
 which the contracts, and the statutes under which they were made, 
 were held to permit all persons to bid for the contracts, and to execute 
 them through third persons. Taylor v. Palmer, 31 Cal. 240, 247; St. 
 lyouis V. Clemens, 42 Mo. 69; Philadelphia v. tockhardt, 71 Pa. 211; 
 Devlin V. New York, 63 N. Y. 8. 
 
 Fourth. Other cases of contracts assigned by the party who was to 
 do certain work, not by the party who was to pay for it, and in which 
 the question was whether the work was of suth a nature that it was 
 intended to be performed by the original contractor only. Robson v. 
 Drummond, 2 Barn. & Adol. 303; Waggon Co. v. Lea, 5 Q. B. Div. 
 149; Parsons v. Woodward, 22 N. J. Law. 196. 
 
 Without considering whether all the cases cited were well decided, 
 it is sufficient to say that none of them can control the decision of the 
 present case. Judgment affirmed.^" 
 
 3 6 In American Smelting & Refining Co. v. Bunker Hill & Sullivan Mining 
 & Concentrating Co. (D. O.) 248 Fed. 172 (1918), a similar contract contained 
 a term that it should be "binding upon and inure to the benefit of successors 
 and assigns." At suit of the assignee the contract was specifically enforced 
 in equity. The court said: "The assignment, it must be understood, cannot 
 relieve the assignor of its obligations to the Mining Company under its agree- 
 ment. 5 O. J. 879. But the Smelting Company having by its assignment dele- 
 gated its performance to the A. S. & R. Company, and the A. S. & R. Com- 
 pany by accepting the assignment having become bound to perform as the 
 smelting Company was bound in the first instance, the Mining Company has 
 lost no remedial rights, but instead has been accorded a like remedy against 
 the A. S. & R. Company to that it had against the Smelting Company. In a 
 
Ch. 7) ASSIGNMENT 1171 
 
 PORTUGUESE^AMERICAN BANK OF SAN FRANCISCO v. 
 
 WELLES et al. 
 
 (Supreme Court of the United States, 1916. 242 V. S. 7, 37 Sup. Ot. 3, 61 
 L. Ed. 116, Ann. Cas. 1918D, 643.) 
 
 Mr. Justice Holmes delivered the opinion of the court: 
 This is a suit brought by the appellee Welles to establish a lien upon 
 a debt of $6,830.85, due under a construction contract from the city 
 of San Francisco, represented by the appellee Boyle, to the bankrupt, 
 Metropolis Construction Company. The district court approved the 
 report of the referee against the claim and in favor of the appellant, 
 but this decree was reversed by the circuit court of appeals. 211 
 Fed. 561, 128 C. C. A. 161 ; 215 Fed. 81, 131 C. C. A. 389. The sub- 
 ject-matter is the fourth progress payment, which, on December 5, 
 1910, had been authorized by the board of public works of the city. 
 
 broad sense, tliis is exactly what the parties from the very inception of the 
 negotiations contemplated might happen." 
 
 Personal performance by the assignor was held to be a condition precedent, 
 so that attempted substitution of an assignee had the effect of a repudiation, 
 in the following cases : Griffith v. Tower Pub. Co., [1897] 1 Ch. 21, contract 
 by defendant to publish plaintiff's book and to pay royalty ; Kemp v. Baersel- 
 man, [1906] 2 K. B. 604; New York Bank Note Co. v. Hamilton Bank Note 
 Engraving & Printing Co., 180 N. T. 280, 73 N. E. 8 (1905), contract to sell 
 presses and to pay over money received ; New England Cabinet Works v. Mor- 
 ris, 226 Mass. 246, 115 N. B. 315 (1917), contract to design and install furni- 
 ture; Paige V. Faure, 229 N. Y. 114, 127 N. E. 898 (1920), in spite of an ex- 
 press provision for the benefit of "assigns"; Edison v. Babka, 111 Mich. 285, 
 69 N. W. 499 (1896) ; Hardy Implement Co. v. South Bend Iron Co., 129 Mo. 
 222, 31 S. W. 599 (1895) ; Walker Electric Co. v. New York Shipbuilding Co., 
 241 Fed. 569, 154 C. C. A. 345 (1917). 
 
 In sales on credit, where the assignor was to give his personal note, a tender 
 of the assignee's note is not sufficient. Hambleton v. Jameson, 162 Iowa, 186, 
 203, 143 N. W. 1010 (1913) ; Wood v. Blanchard, 212 Mass. 53, 55, 98' N. E. 
 616 (1912). But where mere book credit was to be given the seller must de- 
 liver to the buyer's assignee on tender of the cash by the latter. Koehler & 
 Hinriehs Mercantile Co. v. Illinois Glass Co., 143 Minn. 344, 173 N. W. 703 
 (1919). 
 
 An assignment of contract rights is not invalid, even though it purports to 
 provide for a substitution of the assignee in the matter of duty and liability 
 as well as of right ; the assignee may enforce the assigned right in case the 
 conditions precedent thereto in the way of performance by the assignor have 
 been fulfilled. American Lithographic Co. v. Ziegler, 216 Mass. 287, 103 N. 
 E. 909 (1914). 
 
 Where the assignee clearly assumes to perform the contractual duties of 
 the assignor, this is no novation, and the assignor remains bound as before ; 
 but the other party to the original contract now has an additional security 
 and can sue the assignee for breach in jurisdictions recognizing the rights of 
 a creditor-beneficiary. Corvallis & A. R. K. Co. v. Portlan,d E. & E. E- Co., 
 84 Or. 524, 163 Pac. 1173 (1917) ; Atlantic & N. C. R. Co. v. Atlantic & N. C. 
 Co., 147 N. C. 368, 61 S. E. 185, 23 L. R. A. (N. S.) 223, 125 Am. St. Eep. 
 550, 15 Ann. Cas. 363 (1908) ; Jones v. AUert, 161 Cal. 234, 118 Pac. 794 
 (1911). A mere assignment of rights does not necessarily carry with it such 
 an assumption of duties. Lunt v. Lorscheider, 285 111. 589, 121 N. E. 237 
 (1918) ; Mound Valley Vitrified Brick Co. v. Mound Valley Natural Gas & 
 Oil Co. (C. C.) 258 Fed. 936 (1911) ; Lisenby v. Newton, 120 Cal. 571, 52 
 Pac. 813, 65 Ain. St. Rep. 203 (1898). 
 
1172 ASSIGNMENT (Ch. 7 
 
 On that day the Construction Company applied to the appellant bank 
 for a loan of $30,000, secured by an order on the auditor of the city, 
 authorizing the bank to draw from the city for the above and other 
 amounts not in controversy here. The bank declined until the order 
 should be accepted by the auditor, whereupon, on the next day, the 
 order was presented to the auditor's office and stamped as received 
 on December 6. The order was intended and taken as an assignment, 
 and, after it had been stamped, was accepted by the bank as security, 
 and the money was advanced. The next day $5,000 more was ad- 
 vanced on the same security, notes being given for each sum. The ap- 
 pellee Welles was a subcontractor, and on December 12 and 16 served 
 notice on the city to withhold payment, as permitted by § 1184 of the 
 Code of Civil Procedure of the state of California. It is admitted by 
 Welles that if the assignment was valid, his rights are subordinate to 
 it (Newport Wharf & Lumber Co. v. Drew, 125 Cal. 585, 58 Pac. 187); 
 and the only question argued on his behalf is whether the terms of 
 the contract beween the bankrupt and the city made the assignment 
 void. 
 
 The contract provided that the contractor should keep the work un- 
 der his personal control, and should not assign or sublet the whole or 
 any part thereof without the consent of the board of public works. It 
 further declared that no subcontract should relieve the contractor of 
 any of his obligations, and that he should not, "either legally or equita- 
 bly, assign any of the moneys payable under the contract or his claim 
 thereto unless with the like consent." The city has made no objec- 
 tion to the assignment to the bank, and the money now awaits the de- 
 cision of this court as between the claimant of the lien and the prior as- 
 signee. 
 
 There is a logical difficulty in putting another man into the relation 
 of the covenantee to the covenantor, because the facts that give rise to 
 the obligation are true only of the covenantee, — a. difficulty that has 
 been met by the fiction of identity of person and in other ways not 
 material here. Of course, a covenantor is not to be held beyond his 
 undertaking, and he may make that as narrow as he likes. Arkansas 
 Valley Smelting Co. v. Belden Min. Co., 127 U. S. 379, 8 Sup. Ct. Rep. 
 1308, 32 L. Ed. 246. But when he has incurred a debt, which is prop- 
 erty in the hands of the creditor, it is a different thing to say that, 
 as between the creditor and a third person, the debtor can restrain 
 his alienation of that, although he could not forbid the sale or pledge 
 of other chattels. When a man sells a horse, what he does, from the 
 point of view of thei law, is to transfer a right, and a right being 
 regarded by the law as a tiling, even though a res incorporalis, it is not 
 illogical to apply the same rule to a debt that would be applied to a 
 horse. It is not illogical to say that the debt is as liable to sale as it 
 is to the acquisition of a lien. To be sure, the lien is allowed by a 
 statute subject to which the contract was made, but the contract was 
 made subject also to the common law, and if the common law applies 
 
Ch. 7) ASSIGNMENT XI73 
 
 the principle recognized by the statute of California that a debt is to be 
 regarded as a thing, and therefore subjects it to the ordinary rules in 
 determining the relative rights of an assignee and the claimant of a 
 lien, it does nothing of which the debtor can complain. See further, 
 Cal. Civ. Code, §§ 954, "11. The debtor does not complain, bul 
 stands indifferent, willing that the common law should take its 
 
 course." 
 
 * * 
 
 The assignability of a debt incurred under a contract like the 
 present sometimes is sustained on the ground that the provision against 
 assignment is inserted only for the benefit of the city. Whether 
 that form of expression is accurate or merely is an indirect recognition 
 of the principle that we have stated hardly is material here. It is 
 enough to say that we are of opinion that, upon the facts stated, the 
 assignment was not absolutely void, that therefore the bank got a 
 title prior to that of Welles, and consequently that the decree must be 
 reversed. See Hobbs v. McLean, 117 U. S. 567, 6 Sup. Ct. 870, 29 
 L. Ed. 940; Burnett v. Jersey City, 31 N. J. Eq. 341; Fortunato v. 
 Patten, 147 N. Y. 277, 41 N. E. 572. 
 
 Decree reversed.^* 
 
 Mr. Justice McKenna dissents for the reasons stated by the cir- 
 cuit court of appeals. 
 
 BUTLER V. SAN FRANCISCO GAS & ELECTRIC CQ. 
 (Supreme Coiirt of California, 1914. 168 Oal. 32, 141 Pac. 818.) 
 
 Action by Frank I. Butler against the San Francisco Gas & Elec- 
 tric Company, in which Henry T. Johnson intervened. Judgment 
 for defendant, and plaintiff appeals. Reversed, with directions. 
 
 LoRiGAN, J.^® This cause was transferred to this court after judg- 
 pient affirmed by the District Court of Appeal. 
 
 On December 30, 1909, William A. Butler, brother of the plain- 
 tiff, entered into a written contract with the defendant gas com- 
 pany to furnish the labor and material and do the brick and terra 
 cotta work on a certain building to be constructed for the defend- 
 ant; the latter agreeing to pay him therefor the sum of $2,940. 
 The contract expressly provided that no assignment of it should be 
 
 87 The court here distinguished the case of Burck v. Taylor, 152 U. S. 634, 
 14 Sup. Ot. 696, 38 L. Ed. 578 (1894). 
 
 38 See also. Pond Creek Coal Co. v. Riley Lester 4 Bros., 171 Ky. 811, 188 
 S. "W. 907 (1916) ; Payne v. Lautz Bros. & Co. (Sup.) 168 N. T. Siipp. 369 
 (1918) . See comment in 26 Yale Law Journal, 304. 
 
 A provision in an insurance policy that it is to he void if assigned before 
 loss, is valid. Morgan v. American Cent. Ins. Co., 80 W. Va. 1, 92 S. B. 84, Jj. 
 R. A. 1917D, 1049 (1917). , ^ ^ .. 
 
 In Brice v. Bannister, 3 Q. B. D. 569 (1878), Bramwell, L. 'J., said: 
 "Maybe, if in the contract with A. it was expressly stipulated that an assign- 
 ment to B. should give no rights to him, such a stipulation would be binding. 
 I hope it would be." 
 
 8 8 Part of the opinion is omitted. 
 
1174 ASSIGNMENT (Ch. 7 
 
 made by said Butler nor any portion of. the work sublet by him to 
 any subcontractor without the written consent of the defendant, and 
 that said Butler should personally supervise and direct the work 
 contracted for. On February 12, 1910, said Williani A. Butler and 
 his brother, the plaintiff herein, entered into the following contract: 
 
 "This agreement made this twelfth day of February, 1910, be- 
 tween Frank I. Butler, party of the first part, and William A. Butler, 
 party of the second part, both of the city and county of San Fran- 
 cisco, witnesseth : That the party of the first part does hereby agree 
 for and in consideration of $2,940, to furnish all labor and material 
 required to do all the brick work and set all terra cotta, for building 
 of the addition of the central station 'C of the San Francisco Ga? 
 & Electric Company, east of Fourth street, all in accordance with 
 the plans and specifications furnished by D. H. Burnham & Co., ar- 
 chitects, and included in the contract entered into by the said W. A. 
 Butler and the said San Francisco Gas & Electric Company. In 
 consideration of this agreement the said W. A. Butler will pay or 
 cause to be paid to the said Frank I. Butler the above-mentioned 
 sum when it becomes due from the said San Francisco Gas & Elec- 
 tric Company." 
 
 Under this last contract the work was commenced by the plaintiff, 
 although it was personally supervised and directed by said William 
 A. Butler, and was completed and accepted by the defendant on April 
 14, 1910. No question is made but that the work provided to be 
 done was done satisfactorily. On March 19, 1910, the defendant 
 paid to William A. Butler $1,350 pursuant to the terms of its con- 
 tract with him, which le;ft a balance to become due under the con- 
 tract of $1,440 ($150 having been deducted by mutual consent), of 
 which $705 was payable April 14, 1910, the remainder of $/'3S paya- 
 ble 35 days thereafter, or about June 4, 1910. On. April 7, 1910, 
 plaintiff in writing notified defendant that he was the subcontractor 
 for the work, that he had received from William A. Butler $1,350, the 
 first payment thereon, and that another payment would be due there- 
 on in a few days, as his work would then be finished, and notified 
 defendant to withhold the money due on its contract with WiUiani 
 A. Butler for the plaintiff. This notice was accompanied with a 
 copy of the contract set forth above between plaintiff and the said 
 William A. Butler. The defendant was not requested to, nor did 
 it, give its consent to the contract entered into between the Butlers, 
 nor did it know of such contract or that William A. Butler had not 
 personally performed the wprk under his contract with it until this 
 notice and a copy of the contract was served on it on said April 7, 
 1910, when the work was substantially completed. 
 
 The intervener herein, Henry T. Johnson, had on November 7, 
 1909, obtained a judgment against said William A. Butler for $862.- 
 25. An execution was issued thereon on March 23, 1910, and served 
 on defendant, levying upon any moneys due or owing by defend- 
 
Ch. 7) ASSIGNMENT 1175 
 
 ant to said William A. Butler. On April 18, 1910, William A. But- 
 ler by written instrument assigned to plaintiff all moneys due or to 
 become due by reason of his contract with defendant, but of this as- 
 signment defendant had no notice until the present action was 
 brought. On April 25, 1910, plaintiff served another notice on de- 
 fendant similar to that of" April 7, 1910, but on April 28th there- 
 after the defendant paid to the sheriff under the levy on the execu- 
 tion heretofore referred to the sum of $70.S, and took the receipt 
 of the sheriff therefor. On May 12, 1910, plaintiff filed a claim of 
 lien for $1,440 against the property of the defendant upon which the 
 work had been performed, and thereafter commenced this action. 
 Prior to the filing of the second amended complaint herein, and 
 about October 18, 1910, another writ of execution was issued on 
 the judgment against William A. Butler obtained by the intervener, 
 Johnson, and was served on defendant to satisfy a balance claimed 
 to be due on said judgment of $164.30, but no part of this was paid 
 by the defendant. 
 
 The second amended complaint set forth three causes of action : 
 To foreclose a mechanic's lien; to recover upon the notices served 
 on the defendant to withhold the money due; to recover upon an 
 assignment to plaintiff from William A. Butler of all moneys due 
 him under his contract with defendant. 
 
 The defendant gas company in its answer set up as a defense the 
 violation of the clause in its contract ~ with William A. Butler, and 
 further that the contract between said William A. Butler and the 
 plaintiff had been knowingly and fraudulently entered into by them 
 for the purpose of defrauding a judgment creditor — the intervener, 
 Johnson — out of the fruits of his judgment against said William A. 
 Butler by a transfer from said William A. Butler to the plaintiff of 
 the moneys which might become due from the defendant under its 
 contract with said William A. Butler; set up the payment by de- 
 fendant of $705 to the sheriff under the execution as heretofore stat- 
 ed, and the further levy on the moriey in its hands for the balance 
 claimed to be due said Johnson on his judgment; and admitted that 
 there was due William A. Butler under his contract any balance 
 remaining, after deducting these amounts. 
 
 A complaint in intervention was filed by the intervener, Johnson, 
 in which said William A. Butler was made a party defendant and to 
 which he appeared and answered. The intervener also attacked the 
 validity of the contract between William A. Butler and the plaintiff, 
 on the ground that it was entered into between tbem for the pur- 
 pose of cheating and defrauding him of the fruits of his judgment 
 obtained against William A. Butler, and asked for a judgment re- 
 quiring the defendant gas company to pay over to the sheriff upon 
 the execution levied on the money in its hands the balance due said 
 intervener. 
 
1176 ASSIGNMENT (Gh. 7 
 
 The court found that the contract entered into between William 
 A. Butler and the plaintiff was, in legal effect, an assignment of the 
 contract between said WilHam A. Butler and the defendant and ut- 
 terly void, as in contravention of the clause in the" original contract 
 prohibiting any assignment thereof ; that being void for this reason 
 plaintiff succeeded to no rights whatever under it either to support 
 a lien or any other claim against the defendant ; that the assignment 
 of April 18, 1910, from William A. Butler to plaintiff of all moneys 
 due or to become due arising out of the, contract between William 
 A. Butler and defendant was equally void by virtue of the prohibi- 
 tory clause in the original contract. The court further found that 
 the contract between the Butlers was made pursuant to a collusion 
 and conspiracy on their part to defraud the intervener as a judg- 
 ment creditor of William A. Butler; sustained the payment of the 
 $705 made by the defendant to the sheriff on the levy of the exe- 
 cution; and found that there was still due the intervener $156.67 
 as a balance on his judgment against William A. Butler, and that 
 there was unpaid from defendant to William A. Butler the sum of 
 $578.33. The judgment was that the intervener had a lien on the 
 moneys in the hands of the defendant due and unpaid froiti it to Wil- 
 liam A. Butler to the extent of the balance due on his judgment, 
 and that plaintiff take nothing by his action. 
 
 Plaintiff appeals from the judgment, and insists that the view of 
 the trial court that the contract entered into between hirhself and 
 William A. Butler was in legal effect, an assignment of the original 
 contract, and hence 'void, is erroneous. He insists further that the 
 .finding of the court that this contract between himself and William 
 A. Butler was fraudulently entered into for the purpose of defeating 
 the claim of the intervener as a judgment creditor of William A. 
 Butler, and so sustaining the payments made by the defendant un- 
 der the execution levied thereon, is not supported by the evidence ; 
 and, in any event, that as to the balance of the contract price ad- 
 mitted to be due by defendant to William A. Butler plaintiff, as his 
 assignee, was entitled to a judgment for it in his favor. 
 
 As to the nature of the contract between himself and William A. 
 Butler, the position of the appellant is that that contract does not 
 purport to be an assignment of the original contract, and does not 
 have that legal effect; that it does not pretend to transfer the legal 
 title to plaintiff or create any privity between the plaintiff and de- 
 fendant; that it is purely an independent contract whereby plaintiff 
 undertook to furnish the materials and do the work contracted for 
 by William A. Butler for the sum which was to be paid by it to Wil- 
 liam A. Butler; that the fact that the price to be paid coincides in 
 both contracts is entirely collateral, and does not make his contract 
 with William A. Butler an assignment or detract at all from its 
 force as an independent contract. While stating this contention as 
 to the nature of the contract, we do not feel required to determine 
 
Ch. 7) ASSIGNMENT 1177 
 
 it. In the view we take on this appeal, a construction in harmony 
 with the contention of appellant could only be important on the 
 question of a lien in his favor, and then only with reference to a 
 portion of the last payment admitted by defendant to be due Wil- 
 liam A. Butler for the work performed, because, under the partic- 
 ular finding of the court, to be immediately referred to, that is all 
 which, in any event, the plaintiff would be entitled to recover. And, 
 if entitled to a judgment for that amount, it is apparent in this case 
 that he will be just as fully protected by a personal judgment against 
 the defendant as through a lien. The question must, as we say, be 
 limited to the right of plaintiff to recover this balance of the last 
 payment for the work, because, whatever the nature of the contract 
 between plaintiff and William A. Butler may have been, the finding 
 of the court that it was fraudulently made for the purpose of de- 
 feating the rights of the intervener as a judgment creditor of Wil- 
 liam A. Butler, if supported by the evidence, fully warranted the 
 trial court in sustaining the payments made by the defendant to the 
 sheriff after the levy of execution, and providing also for the fur- 
 ther payment of the balance due on the judgment. * * * 
 
 It will now be observed that deducting these amounts — ^$705 and 
 $156.67 — from the $1,440 due under the original contract leaves the 
 sum of $578.33 unpaid and in the hands of the defendant. The de- 
 fendant admitted that it was indebted under the original contract 
 for that amount, but contends that it owes it to William A. Butler, 
 and not to the plaintiff, and this is the effect of the judgment ren- 
 dered by the trial court. In this conclusion we are of the opinion 
 that the trial court was in error. Assuming, as the court found, 
 that the contract between the Butlers was void as an attempted as- 
 signment of the original contract, then the work under it must be 
 deemed to have been done by William A. Butler, and on this the- 
 ory the payments thereunder were due to him alone. But one of. 
 the causes of action set up by plaintiff as the basis of a recovery 
 against defendant was an assignment by William A. Butler to him 
 of all moneys due or to become due under the original contract 
 which was made after the work was fully performed and accepted 
 by the defendant. The theory of the trial court was that this as- 
 signment of these moneys due under the original contract was void, 
 as controverting the clause of the contract against assignment. 
 But it is apparent from the terms of the prohibition against assign- 
 ment that this went only to the performance of the work itself, which 
 was to be personally supervised by William A. Butler. It did not 
 apply to the benefits accruing on performance of the work. He was 
 to perform the work before any liability could exist for the final 
 payment. That work was done, and all that was assigned was the 
 final payment earned, but not yet due. The mere assignment of 
 moneys due or to become due, although the contract may not be 
 assigned, is held not to be an assignment of the contract. National 
 
1178 ASSIGNMENT (Gh. 7 
 
 Surety Co. v. Maag, 43 Ind; App. 16, 86 N; E. 862 ; In re Wright, 
 157 Fed. 544, 85 C. C. A. 206, 18 L. B. A. (N. S.) 193; Dkksbn v. 
 City of St. Paul, 97 Minn. 258, 106 N. W. 1053; Fortunato v. Pat- 
 ten, 147 N. Y. 277, 41 N. E. 572. 
 
 The assignment of the payments being valid, the court should 
 have entered a judgment in favor of the plaintiff for this balance; 
 of $578.33. It had all the parties before it, so that complete dis- 
 position of the matter could be had. The claims of Johnson, the 
 intervening creditor, were satisfied. Defendant had admitted that 
 it owed the money. One or the other Butler was entitled to it. 
 William A. Butler was before the court, having answered the com- 
 plaint in intervention. He made no claim to the money, and clear- 
 ly under his assignment was estopped from doing so. It is true, 
 as found by the court, that the defendant had no notice of this as- 
 signment until this action was brought. This, however, would only 
 affect the matter of costs.' But under the circumstances we do not 
 think the defendant is entitled to any consideration in that matter. 
 While it had no notice until this suit was brought of this partic- 
 ular assignment, it had several notices served upon it which showed 
 that plaintiff was quite persistently claiming that he was entitled 
 to the money from the defendant, and that as between the Butlers, 
 who were the only ones, except the creditor Johnson, who made 
 claim to a portion of it, he was entitled to it. 
 
 As we have said, we do not think it is necessary to pass upon the 
 question as to the nature of the contract between the Butlers, wheth- 
 er, in effect, an assignment or an independent contract. This would 
 only be necessary if we thought the matter of a lien in favor of the 
 plaintiff was important. But it is not. Plaintiff, for the reasons 
 heretofore given, would not in any event be entitled to recover a 
 greater sum than the amount of the balance of the final payment 
 due by the terms of the original contract. The defendant admitted 
 that indebtedness and its willingness to pay it to William A. Butler. 
 No question arises but that it is amply able to make the payment 
 and to whoever the court determines is entitled to it. 
 
 The judgment is reversed, with directions to the lower court to 
 enter a personal judgment in favor of plaintiff against the defend- 
 ant for $578.33, and costs. 
 
 WHiTEIvEY, Limited, v. HILT. 
 (In the Court of Appeal. [1918] 2 K. B. 808.) 
 
 Appeal from the decision of a Divisional Court (Salter and Roche, 
 
 JJ-) 
 
 The action was brought in the county court by the plaintiffs, Wil- 
 liam Whiteley, Limited, against the defendant. Miss Mina Hilt, for 
 
Ch. 7) ASSIGNMENT 1179 
 
 the return of a piano, which they had let to a Miss Nolan under a 
 hire-purchase agreement, and for damages for its detention. 
 
 By an agreement dated December 10, 1916, the plaintiffs agreed 
 to let Miss Nolan, who was then living in a flat at College Court, 
 Hammersmith, the piano in question upon the following terms: 
 
 (1) To pay i2 13s. lid. on signing in consideration of the option 
 of purchase therein granted, and punctually to pay a further £2 13s. 
 Ud. quarterly. (2) To keep the piano in good repair and take 
 all risks. (3) Not to remove it without the previous consent of the 
 owners. (5) In case of any breach of the agreement the owners were 
 to be entitled to enter the premises and to retake the piano. The 
 owners agreed: (a) That the hirer could at any time during the hire 
 terminate the same by returning the article to the owners, (b) The 
 hirer could become the owner of the said article by paying the hire 
 punctually, btit should remain merely a bailee until the full sum of £32 
 7s. was paid, (c) Should the owners retake the piano under the 
 terms of the agreement, the hirer should have the right to resume the 
 hiring, provided she paid the arrears of hiring up to the date of re- 
 possession and procured a guarantor to the satisfaction of the own- 
 ers, and paid expenses. 
 
 On December 3, 1916, Miss Nolan, having paid all the instalments 
 which were due up to that date, amounting to £13 9s. 7d., sold the con- 
 tents of her flat, including the piano for £100 to the defendant, who 
 succeeded her as occupier of the flat. She gave the defendant a re- 
 ceipt for the £100 in the following form: 
 
 ■'40, College Court, Hammersmith. Received of Mina Hih £100 
 in full payment for all my furniture, piano, and plate, pictures, linen, 
 carpets, and effects — the whole contents of this flat as set down in the 
 following list. I solemnly declare that the property is my own and 
 that no one has any claim upon it. Received £100 from Mina Hilt. 
 Nina Incledon Widlake, December 3, 1916." 
 
 Mrs. Widlake. was the same person as Nina Nolan. The defend- 
 ant, in a letter to the plaintiffs, dated August 10, 1917, stated that 
 before purchasing she made various inquiries to ascertain that Miss 
 Nolan had the right to dispose of all the contents of the flat; she in- 
 quired of the landlord's agent and his solicitor, and she employed a 
 person to search for bills of sale or judgments against her. She 
 added in her letter that she had paid her hard-earned savings in all 
 good faith, and could have taken no more precaution or used greater 
 care than she did. 
 
 At the date of the purchase it was not suggested that there had 
 been any breach of the agreement, and four days subsequently, on 
 December 7, 1916, Mrs. Widlake paid to the plaintiffs £2 13s. lid., 
 which would become due under the agreement on December 10. This 
 payment was unknown to the defendant, and it was not alleged that 
 the defendant was then aware of the hire-purchase agreement. No 
 further payments were made to the plaintiffs by Mrs. Widlake. The 
 
1180 ASSIGNMENT (Ch. 7 
 
 amount paid by her was il3 9s. 7d., leaving £18 17s. 5d. as the 
 amount required to make up the full sum of £32 7s. The plaintiffs 
 not receiving the remaining hire payments, made inquiries about the 
 piano, and, ascertaining that it remained in the flat and that the de- 
 fendant was the occupier^ on August 9, 1917, they wrote to her de- 
 manding the return of the piano. The defendant refused to deliver 
 up the piano, but offered to pay the balance of the instalments re- 
 maining unpaid and to give a substantial guarantee for the payment. 
 The plaintiJiEs refused to accept the offer, and stied the defendant in 
 the county court for detinue and alternatively for conversion of the 
 piano. The defendant paid £18 7s. Sd., together with a sum for costs, 
 into Court in satisfaction of the claim, and set up the defence that 
 the plaintiffs were not entitled to more than that amount. The coun- 
 ty court judge gave judgment for the defendant. On appeal from 
 his decision the Divisional Court held that the defendant had ac- 
 quired no interest in the piano, for that Miss Nolan by wrongfully sell- 
 ing it had repudiated the agreement, and had no interest in the piano 
 to transfer. The plaintiffs were therefore entitled to recover the piano 
 or its full value without giving credit for the instalments which they 
 had already received. 
 
 The defendant appealed. 
 
 SwiNFBN Eady M. R. (after stating the facts). The county court 
 judge decided that the defendant acquired the rights of Miss Nolan 
 (otherwise Mrs. Widlake) under the agreement before anything was 
 or could be done to terminate it, no instalment being, then in arrear, 
 and that the measure of the plaintiffs' damage was the amount of 
 instalments unpaid, £18 17s. 5d. ; and; as that sum had been paid 
 into Court, the plaintiffs were not entitled to recover anything more. 
 He accordingly directed judgment to be entered for the defend- 
 ant *» * * * 
 
 The appellant upon this appeal also contends that the judgment of 
 the Divisional Court was erroneous upon the measure of damages, 
 and that the judgment of the county court judge was right in law. 
 The first question which arises is whether Mrs. Widlake had any 
 interest under the hire-purchase agreement which she could lawful- 
 ly assign. The plaintiffs insist that the agreement merely amounts 
 to a bailment which was ended by parting with the possession of 
 the chattel bailed, and that the owner thereupon became entitled to 
 its immediate return. It is not disputed that, by virtue of the sale, 
 all the right, title and interest which Mrs. Widlake could dispose 
 of passed to the defendant. At the date of the sale there had not 
 been any breach of the agreement, and there was not any present 
 right in the plaintiffs to claim the return of the piano. The agree- 
 ment is not only a letting to hire of a piano ; it also confers for a val- 
 
 ■"' The court then held that the trial court's finding was conclusive on ap- 
 peal, and that therefore Miss Nolan must be regarded as not having repu<li- 
 ated the contract and as not having committed either larceny or conversion. 
 
Ch. 7) ASSIGNMENT Hg] 
 
 uable consideration an option of purchase. Moreover, clause (c) shows 
 that if default is made in payment of the instalments, or if for any 
 other breach the plaintiffs retake possession of the chattel, the hir- 
 er's interest is not thereby terminated, but the hirer has. the right to 
 resume the hiring, on paying the arrears of hire up to the date of re- 
 possession, and procuring a satisfactory guarantee. Parting with the 
 possession of the piano would not be a breach of the agreement if 
 the piano remained in the flat and was not removed contrary to clause 
 3. If Mrs. Widlake had let her flat furiyshed for three years with 
 the piano, the plaintiffs would not have been entitled on that account 
 to retake the piano. The whole terms of the agreement show that 
 the contract was not merely a bailment for reward, but that it con- 
 ferred on the bailee an interest in the chattel. It did not amount to a 
 contract for sale, as the hirer was not bound to purchase. But it did 
 confer on the hirer an absolute right to purchase on complying with 
 the provisions of the agreement. The contract was in my opinion 
 assignable by the hirer, but the assignee could only retain possession 
 of the chattel upon the terms of the contract. There was no right 
 to remove the piano from the flat, nor has it been removed. There is 
 no reason whatever for supposing that any personal element entered 
 into the mind of either of the parties to the agreement, or that it 
 would make any difference to the plaintiff by whom the obligations 
 of the contract were fulfilled, or that there were any grounds for tak- 
 ing this contract out of the well-settled general rule that the benefit of 
 a contract is assignable in equity and may be enforced by the assignee : 
 see Tolhurst v. Associated Portland Cement Manufacturers, [1902] 2 
 K. B. 660, [1903] A. C. 414; British Waggon Co. v. Lea, 5 Q. B. 
 D. 149. 
 
 The defendant therefore acquired all the interest of the vendor, 
 and moreover she had the right in equity to compel the vendor to pay 
 the remaining instalments to the plaintiffs and enforce for the bene- 
 fit of the defendant all rights conferred by clause (c) of the con- 
 tract.*^ * * * 
 
 Under these circumstances I am of opinion that the appeal should 
 be allowed and the judgment of the county court judge restored. 
 
 WARRikGTON, L. J. I am of the same opinion. The question is 
 whether under this agreement the hirer on December 3, 1916, had an 
 interest assignable and in fact assigned that interest to the defend- 
 ant. The agreement refers to a. specific ascertained chattel. It de- 
 scribes the nature of the transaction as being an option to purchase. 
 The first payment was to be made in consideration of the option to 
 purchase therein granted. The nature of the interest taken by the 
 hirer under the agreement appears to me to be this : First, a right to 
 retain possession of the chattel so long as she performed the con- 
 
 *i The concurring opinion of Duke, L. J., and parts of tlie otlier two opinions 
 have been omitted. 
 
1182 ASSIGNMENT (Ch. 7 
 
 ditions of the agreement. Secondly, an option to purchase the chat- 
 tel exercisable by payment of the instalments provided for by the con- 
 tract. Thirdly, in case of failure to pay any instalment or breach of 
 any other of the provisions of the agreement and possession thereupon 
 taken by the plaintiffs, the right to have restored first her right to 
 possession and secondly the option of purchase upon performing the 
 conditions prescribed by the agreement. That, in my opinion, was 
 the interest of the hirer. The general property in the chattel no doubt 
 remained in the plaintiff^ but that general property in it was qual- 
 ified and limited by the contractual interest conferred by the agreement 
 upon the hirer. 
 
 Now, was that interest assignable? In my opinion it clearly 
 
 "wa"^ 42 * :(; H: 
 
 HYLAND v. CROFUT. 
 (Supreme Court of Errors of Connecticut, 1913. 87 Conn. 49, 86 Atl. 753.) 
 
 Action by James J. Hyland against Harriet S. Crofut for damages 
 on a contract made by defendant to pay the debts of plaintiff's assignor 
 to a specified amount. From a judgment for plaintiff, defendant ap- 
 peals. Reversed and remanded, with directions to enter judgment 
 for plaintiff. 
 
 Prior to February, 1909, the defendant and George E. Crofut, her 
 husband, conducted a hotel at Oxford, Conn., known as the Crofut 
 Inn. Shortly before, the execution of the contract in question, the 
 defendant had brought an action for divorce against her husband and 
 attached his personal property and his interest in the real estate con- 
 nected with the business. The trial court has found that on March 
 8, 1909, the defendant in consideration of a transfer to herself of the 
 attached personal property and of his interest in the attached real 
 estate agreed to pay Crofut $400 in cash, and to pay certain debts 
 contracted by him in the conduct of the business to an amount not ex- 
 ceeding $1,000. Pursuant to this agreement, bills of sale and deeds 
 
 *2 The i)bwer created by an ordinary offer is still regarded as unassignable 
 by the offeree. See Oorley v. Ehlers, 99 Kan. 748, 163 Pac. 140 (1917), offer 
 to sell land;. Jordan, Marsh Co. v. Heals, 201 Mass. 163, 87 N. E. 471 (1909). 
 But the irrevocable power created by an option contract is assignable, the 
 legal relations being regarded as conditional rights and conditional duties. 
 Cummins v. Beavers, 103 Va. 230, 48 S. B. 891, 106 Am. St. Rep. 881, 1 Ann. 
 Cas. 986 (1904) ; Watkins v. Robertson, 105 Va. 269, 54 S. B. 33, 5 L. K. A. 
 (N. S.) 1194, 115 Am. St. Rep. 880 (1906) ; Black v. Maddox, 104 Ga. 157, 
 30 S. E. 723 (1898) ; Thommen v. Smith, 88 N. J. Eq. 476, 103 Atl. 25 (1918) ; 
 House V. Jackson, 24 Or. 89, 32 Pac. 1027 (1893) ; Blank v. Independent Ice 
 Co., 153 Iowa, 241, 133 N. W. 344, 43 L. R. A. (N. S.) 115 (1911), a receiver 
 was ordered by the court to sell an option. 
 
 There is no power of assignment in case the option contract expressly so 
 provides. Myers v. J. J. Stone & Son, 128 Iowa, 10, 102 N. W. 507, 111 Am. 
 St. Rep. 180, 5 Ann. Cas. 912 (1905) ; Behrens v. Cloudy, 50 Wash. 400, 97 
 Pac. 450 (1908). 
 
 See Oorbin, "Option Contracts," 23 Yale Law Journal, 641, 658 (1914). 
 
Ch. 7) ASSIGNMENT 1183 
 
 were prepared and executed by Crofut and delivered to and accepted 
 by the defendant, and the defendant then paid to Crofut $400, and 
 took possession of the property, and also signed in duplicate an agree- 
 ment to pay the debts of Crofut to an amount not exceeding $1,000, 
 with list of creditors annexed, the total amount of listed debts being 
 $940.09. One of these duplicates was delivered to Crofut and the other 
 retained by the defendant. 
 
 Some time between March 8th and March 29th substitute bills of 
 sale and conveyances of real estate were made in order to correct a 
 supposed mistake in the original papers. The plaintiff James J. Hy- 
 land was a creditor of Crofut, whose claim appeared upon the list 
 in question, and on April 12, 1909, he made a demand on the defendant 
 to pay his bill, but the defendant neglected and refused to pay the 
 same. The plaintiff then recovered judgment against George E. Cro- 
 fut in the amount of $48.53, and took out execution for the same, 
 which was returned unsatisfied. 
 
 The plaintiff then, in order to collect his debt, brought an action 
 against the defendant, declaring on her agreement of March 8, 1909, 
 to pay Crofut's debts, including the plaintiff's debt. This action was 
 subsequently withdrawn on the theory that the plaintiff had no' right 
 to sue on said contract without an assignment from Crofut. On 
 October 16, 1909, the plaintiff took from Crofut an assignment in 
 writing of all Crofut's rights, claims, and demands against the de- 
 fendant by reason of her agreement of March 8, 1909; and in con- 
 sideration for the assignment the plaintiff executed a bond in the 
 sum of $1,000, reciting that his judgment was due and unpaid and 
 conditioned to prosecute the chose in action against the defendant, 
 and apply the amount of the recovery, if any, in satisfaction of his 
 own judgment and all other debts of said Crofut which were due on 
 March 8, 1909, to the amount of $1,000, and to his expenses in con- 
 nection therewith. On October 19, 1909, the plaintiff gave written 
 notice of the assignment to the defendant and made demand for 
 $1,000 or for a list of bills which had been paid by her, if any, on 
 account of the agreement, and for the balance remaining in her hands. 
 It is alleged in the complaint and admitted in the answer that "the 
 defendant neglected and positively refused to pay said debts or to 
 pay the plaintiff said $1,000 or any part thereof or to account for said 
 
 $1,000." 
 
 Beach, J.*^ * * * The principal claim of law made by the 
 appellant is that a contract to pay the debts of another is not assign- 
 able, and that the attempted assignment conveyed to the plaintiff 
 nothing more than the right to sue for and collect his own debt of 
 $30. It is argued that some sort of a trust relation was created by 
 the^riginal contract ; that the damages to be recovered in this action, 
 if Ifiy, are in the nature of a trust fund, and that the proposed appli- 
 
 *' Part of the opinion is omitted. 
 
1184 ASSIGNMENT (Ch. 7 
 
 cation of some part of the recovery to the expenses of this litigation 
 is in violation of such a trust ; and that the plaintiff, being under no 
 obligation to pay Crofut's debts," cannot be injured by the defendant's 
 refusal to pay them. We think the contract creates no trust relation. 
 There is no suggestion that the transfer was in fraud of creditors. 
 Crofut's creditors had no lien oh the property transferred, and the 
 defendant holds it as her own. Her agreement to pay Crofut's debts 
 created merely a personal obligation in his favor. She has no fund 
 in her hands which is earmarked for the payment of his debts, nor 
 will the amount recovered as damages in this action be held in trust for 
 that purpose, although the plaintiff has agreed with Crofut as part 
 of the consideration for his assignment to apply some part of the 
 recovery in payment thereof. 
 
 An agreement to pay the debts of anotlier, as pointed out in Lathrop 
 V. Atwood, 21 Conn. 117, is not simply an agreement to indemnify, but. 
 also an agreement to perform the act of paying the debts in question. 
 In this case, as in that, the debts agreed to be paid were for goods sold 
 and delivered without afiy specified term of credit, and were presumably 
 due and payable at the time when the contract was made. No time hav- 
 ing been specified within which the defendant was to pay them, a rea- 
 sonable time was impliedly given, and upon the failure to pay within 
 such a reasonable time a breach of the contract arose for which Crofut 
 could have recovered as damages the amount of the debts so remain- 
 ing unpaid with interest from the date of the contract. Lathrop v. 
 Atwood, supra; Whitney v. Cady, 71 Conn. 170, 41 Atl. 550. This 
 contract was dated March 8, 1909,. and the assignment to the plaintiff 
 although it bears date as of May 15, 1909, was, as the court finds, 
 actually made on October 16, 1909, about seven months after the date 
 of the contract. In Lathrop v. Atwood, supra, it was held that 
 four months was a very liberal allowance of time for the payment of 
 the partnership debts, and that a failure to pay them within that time 
 was a breach for which the plaintiff was entitled to sue. In the present 
 case there was not only a much longer delay before the date of the 
 assignment, but the defendant had refused to pay the plaintiff's debts 
 on demand, and Crofut had been subjected to suit and judgnient on 
 account of such refusal. 
 
 We think the contract had been broken by the defendant's failure to 
 pay the debts before the date of the assignment to the plaintiff, and 
 that the assignment was in effect a transfer of a claim for damages al- 
 ready accrued by reason of the breach of the contract. This is con- 
 sistent with the language of the assignment itself which is "of all of 
 Crofut's rights, claims, and demands" on account of his contract with 
 the defendant. Such a claim is plainly assignable, and the fact that the 
 assignee agrees to apply some part of the recovery to the paynjent 
 of Crofut's debts after satisfying his own judgment and payingffce 
 expenses of this litigation does not prevent the plaintiff from being the 
 actual bona fide owner of said claim within the meaning of section 601, 
 
C'h. 7) ASSIGNMENT 1185 
 
 Gen. Stat. In Metropolitan Life insurance Co. v. Fuller, 61 Conn. 252, 
 23 Atl. 193, 29' Am. St. Rep. 196, a number of policy holders assigned 
 their claims for damages against the company to Fuller and wife upon 
 the assignees undertaking to bring suit and pay all expenses and keep 
 half of the net proceeds, and these assignments were upheld as 
 carrying a full beneficial interest. So in this case the plaintiff is bene- 
 ficially interested, not only in halving his judgment satisfied, but his 
 expenses of litigation paid. * * * . ^ 
 
 Judgment for plaintiff.** 
 
 ** It has often been stated that the assignment of a "mere right of litiga- 
 tion" or a "right of action for damages" is invalid. See Prosser v. Edmonds, 
 1 Y. & C. Ex. 497 (1835) ; May v. Lane, 64 L. J. Q. B. 236, 237 (1894) ; Torkinr 
 ton V. Magee, [il902] 2 K. B. 427, 434 ; Dawson v. G. N. & City By. Co., [1905] 
 1 K. B. 271. And assignment of secondary rights for breach of contract or 
 for tort may still possibly faU' within some state rules governing champerty 
 and maintenance. This will seldom be the case, however. In the United 
 States, generally, all such secondary rights are assignable, except those for 
 torts to the person and for breach of a promise of marriage. See Brantly, 
 Pers. Prop. §§ 265-271; N. Y. Personal Property Law (Consol. Laws, c. 41) 
 § 41; Butler v. New York & E. R. Co., 22 Barb. (N. Y.) 110 (1856) ; Millan 
 v. Bartlett, 78 W. Va. 367, 89 S. E. 711 (1916), holding that "a right of action 
 for breach of covenant, like any other chose in action, may be assigned" ; 
 United Copper Securities Co. v. Amalgamated Copper Co., 232 Fed. 574, 146 
 C. C. A. 532 (1916), right to treble damages under Sherman Act for tortious 
 injury to business; Wells, Fargo & Co. Exp. v. Pugh (Tex. Civ. App.) 185 
 S. W. 61 (1916), right to damages for wrongful delivery by carrier; Ellis v. 
 Torrington, [1920] 1 K. B. 399, right to damages for breach of a covenant to 
 repair. 
 
 In County Hotel & Wine Co. v. L. & N. W. R. Co., [1918] 2 K. B. 251, the 
 court said : "It has been said that the purchase of a mere right of litigation is 
 void. See Prosser v. Edmonds, 1 Y. & C. Ex. 497 (1835), and Hill v. Boyle, 
 L. R. 4 Eq. 260 (1867). That doctrine arose in times when the common law 
 was incapable of recognizing the assignability of choses in action: cf. Pol- 
 lock on Contracts (8th Ed.) pp. 351, 352, and the learned note (F) at p. 747 
 thereof. But although the doctrine of assignability developed, the law of 
 champerty long maintained its rigidity both at law and in equity. Bills of 
 exchange became freely negotiable at law. , Debts became assignable in 
 equity, and their assignability at law (together with other choses in action) 
 was finally recognized by section 25, subsec. 6, of the Judicature Act, 1873 
 (36 & 37 Vict. c. 66). Such being the state of things, it would seem strange 
 indeed to hold that a debt could not be assigned after the debtor had repu- 
 diated the debt by refusing to pay.". 
 
 COBBIN CONT 75 
 
1186 JOINT CONTRACTS (Ch. 8 
 
 « 
 
 CHAPTER VIII 
 JOINT CONTRACTS 
 
 HANKINSON v. SANDILAUS. 
 (In the King's Bench, 1612. Cro. Jac. 322.) 
 
 Debt upon an obligation of forty pounds. Upon oyer of the con- 
 dition thereof the case was, two persons bound "themselves, or any of 
 them, their heifs, executors, or either of their heirs, &c. ;" and the 
 action was here brought against one of the obligors -only, the other 
 then living; whereupon the defendant demurred in law. 
 
 The question was, whether this bond be joint and several, or only 
 a joint bond, to be sued against them both ? 
 
 It was urged for the defendant, that the obligation was sealed and 
 delivered by both of them jointly, and was a joint bond, and the 
 words subsequent, "or either of us" (in respect one of the obligors 
 was to be discharged thereby, it being uncertain which of them), were 
 therefore void : and it differed from the case in Dyer, 19, where three 
 were bound in an obligation, "obligamus nos et utrumque nostrum, 
 &c. ;" the bond there is joint and several, all of them being so bound 
 at the beginning ; but it is not so here : for first, both of them are here 
 bound, and afterwards follow these words, "or either of us ;" and the 
 obligee hath accepted it as a joint deed, and so ought to pursue the 
 same. 
 
 But it was held by ths Court, that the acceptance here is not 
 material as to the election, but it still remains at the pleasure of the 
 obligee to sue them jointly and severally: and the joint delivery- of 
 the bond shall not make it to be a joint bond, and not several, the 
 same being by the law joint and several; and in this case "et" and 
 "vel" are all one. And the Court thereupon over-ruled the demurrer ; 
 and judgment was given, and entered for the plaintiff.^ 
 
 PROCTOR v. BAUBY. 
 (Supreme Court of Errors of Connecticut, 1916. 90 Conn. 251, 96 Atl. 935.) 
 
 Actibn by Sanford Proctor against Peter' Bauby to recover unpaid 
 balance of a certain note, brought by appeal to the district court, and 
 tried to the jury. Verdict and judgment for plaintiff for $458.64, and 
 appeal by defendant. Affirmed. 
 
 1 "Obligamus nos et singulos" is joint and several. Bellewe, 255. 
 
 Where two or more persons promise jointly and severally, they may be sued 
 separately just as if they executed wholly separate contracts. Beecham v. 
 Smith, El. Bl. & El. 442' (1858). , 
 
Gh. 8) JOINT CONTRACTS 1187 
 
 RoRABACK, J." The plaintiflf seeks to recover the amount of an 
 unpaid balance of a note for the principal sum of $2,800, upon which 
 divers payments were made down to November 20, 1913. The note 
 reads as follows: 
 
 "$2,800.00. Waterbury, Conn., Nov. 30, 1906. 
 
 "For value received, I promise to pay Sanford Proctor, of city of 
 Waterbury, or order, twenty-eight hundred dollars, with interest at 
 5 per cent, per annum, payable semiannually, together with all taxes 
 and assessments of every nature when due that may be laid on said 
 sum and on the property by which it is secured. Principal of note is 
 to be paid in payments of $600.00 every six months thereafter, and in 
 default of any payments, said note shall become due and payable on 
 demand. Attilio Menichino. 
 
 "Peter Bauby." * * * 
 
 Several of the defendant's reasons of appeal are based upon the 
 theory that the court should have instructed the jury, as requested, 
 that, as a matter of law, it appears that the plaintiff should have 
 brought his action upon a complaint alleging that the defendant was 
 liable as an indorser of the note, and not that he was the maker. The 
 language of the note "I promise to pay," etc., makes the contract of 
 both signers joint as well as several. The pronoun "I" represents the 
 signers collectively as well as severally. 
 
 General Statutes, § 4187, provides : "(7) Where an instrument con- 
 taining the words, T promise to pay,' is signed by two or more per- 
 sons, they are deemed to be jointly and severably liable there- 
 on." * * * 
 
 The jury were instructed that : "Where a note contains the words 
 T promise to pay,' and is signed by two persons as makers, they are 
 deemed to be and are jointly and severally liable thereon, and either 
 of the makers is liable for the full amount of the note due and un- 
 paid." 
 
 The charge upon this point was correct in law, adapted to the case 
 as it was presented to the jury, and was suiificient for their guidance 
 in reaching a verdict. 
 
 There is no error. The other judges concurred.* 
 
 RIPLEY V. CROOKER et al. 
 (Supreme Judicial Court of Maine, 1860. 47 Me. 370, 74 Am. ,Dec. 491.) 
 
 On an agreed statement of facts. 
 
 Assumpsit on an account annexed, and for a balance alleged to be 
 due jointly from the defendants to the plaintiff, for building five- 
 
 2 Parts of the opinion are omitted. 
 
 8 In accord • March V. Ward, Peake's Cas. 130 (1792) ; Lewenstein t. For- 
 man, 223 Mass. 325, 111 N. B. 962 (1916). 
 
1188 JOINT CONTEAC*S (Ch. 8 
 
 eighths of the ship Adrianna in 1854-55, under the following con- 
 tract : 
 
 "Memorandum of agreement made and concluded upon by Theo- 
 dore Ripley, of Hallowell, Maine, on the one part, and William ,D. 
 Crooker, Samuel Swanton, 2d, and David Crooker and Isaac Preble, 
 all of Bath, on the other, to wit : 
 
 "The said Ripley agrees to build and complete a good ship of about 
 eleven hundred tons, to be built at Hallowell, and to be commenced 
 the next week and completed ready for sea as soon as possible, to be 
 rigged at Bath; and it is binding on him to be particular to charge 
 all the bills, which he pledges to do in. good faith, to arrive at her cost; 
 and for his services is to receive one dollar each re;gister tonnage, 
 with two hundred dollars for use of yard, steambox, and yard tools 
 and shores, &c, and is to receive five thousand per month on eleven- 
 sixteenths, commencing payment the first day of July next, and so on 
 monthly, not to exceed five payments, and when completed the bal- 
 ance to be paid in five and ten months, reckoning interest on rigging 
 bill, iron bill, and Kendall, Richardson & Co.'s bill, should these bills 
 become due previous to the five and ten months payments, no interest 
 to be calculated otherwise but at the bills. And the second parties 
 agree to pay the said Ripley five thousand dollars per month, com- 
 mencing the first of July, and so on rrionthly, not to exceed five pay- 
 ments, to the ship's completion ready for sea, when her cost by the 
 bills is to be estimated, and the materials to be bought at the best 
 advantage for cash, save the iron bill, and rigging, and Kendall, 
 Richardson & Co.'s bills, which, if they become due previous to five 
 and ten months after her completion, the interest on said bills are 
 to be added to the balance to be paid in notes at five and ten months — 
 all other interest not to be reckoned. 
 
 "Recapitulation : Payments, five thousand dollars per month to her 
 completion ready for sea, say $25,000, and the balance in notes at five 
 and ten months ; not to be more than five payments in cash monthly. 
 "Three-eighths, William D. Crooker. 
 
 "One-eighth, Samuel Swanton, 2d. 
 
 "One-eighth, David Crooker. 
 
 'One-sixteenth, Isaac Preble. 
 
 Theodore Ripley. 
 
 "Witness to all the signatures: Howard P. Wiggin. 
 
 "Bath, May 31, 1854." * * * 
 
 May, J.* The contract set forth in the writ, is of two parts. In 
 its direct terms, it is between the plaintiff "on the one part," and the 
 defendants "on the other." Its language is too unequivocal in its 
 meaning to admit of any other construction than that of a joint un- 
 dertaking, on the part of the defendants, to pay for the eleven- 
 sixteenths of the ship built for them, at her cost, in the manner and 
 
 * Part of the statement of facts and a part of the opinion are omitted. 
 
Ch. 8) JOINT CONTRACTS 
 
 1189' 
 
 at the times stipulated in the contract. The contract contains no 
 words fairly indicative of a several liability by each of the defendants 
 for particular parts of the ship; but, on the contrary, the defendants 
 together agree to pay the entire price which was to be paid,, for that 
 portion of the ship which they together agreed to take, and which 
 the plaintif3f agreed to build for them. 
 
 The fact, that words indicative of the proportional part of the ship 
 which each defendant was to take were set against the name of each, 
 does not change the construction of the contract, nor in any way 
 afifect the joint liability of the defendants. Such words do not suffi- 
 ciently show an intention to limit the liability of each defendant to his 
 proportion of the ship, and cannot, therefore, control the general lan- 
 guage used in the contract, so far as the plaintiff is concerned. They 
 may, however, like the word surety or sureties appended to some of 
 the signatures upon a note, serve to show the relations subsisting be- 
 tween the parties of the second part of the contract ; but they cannot 
 be permitted to subvert, or even modify the unambiguous terms of 
 the contract, as made by the parties themselves. 
 
 It is contended, in defence, that the terms of the contract are modi- 
 fied by the proof in the case, tending to show the existence of a cus- 
 tom on the Kennebec riveir for persons engaged in the building of 
 vessels each to be responsible only for his own share. In the case 
 before us, the contract is in writing, and there is no proof that any of 
 its words are by usage or custom understood to be used in any other 
 than their ordinary sense. The custom which is attempted to be 
 proved does not reach this case. To all'ow such a custom to modify 
 the written contract of the parties would be to set it up against their 
 express agreement and manifest intentions, which the law will not 
 permit. See Metcalf v. Weld & al., just decided in Massachusetts, 
 and reported in the Law Reporter, vol. 23, No.. 9, p. 551. 
 
 ' Again, it is said that both the plaintiff and the defendants have al- 
 ways treated this contract as several and not joint; and it fully ap- 
 pears from the evidence that payments have been made by the de- 
 fendants severally, and receipts given by the plaintiff therefor, which 
 clearly indicate that such payments were made by each defendant to- 
 wards his particular share of the ship, and were so received. If 
 the contract was doubtful in its construction, such facts might well 
 aid the Court in determining the intention of the parties in making it ; 
 but, in a case like this, where there is no ambiguity in its terms, it is 
 ncft perceived how the subsequent conduct of the parties can change 
 the plain meaning of the contract, or take away the appropriate 
 remedy thereon, unless such conduct amounts to a severance of the 
 joint liability, or consists of acts which may fairly operate as a release 
 from such liability. But, where several persons are jointly indebted, 
 and one of them, pays his specific share of the debt, and it is received 
 and receipted for by the creditor as such, such payment will not ex- 
 onerate the party paying from his liability for the residue of the debt. 
 
1190 JOINT CONTEACTS (Ch. 8 
 
 Such receipt, not being under seal, is neither a severance of the in- 
 debtedness, nor an effectual release; and, notwithstanding such re- 
 ceipt, the parties to the contract will remain jointly bound, to the ex- 
 tent of what is unpaid, in the same manner as if no such specific pay- 
 ment had been made. McAllester et al. v. Sprague et al., 34 Me. 
 296.0 * * * 
 
 RUTHERFORD v. HOLBERT. 
 (Supreme Court of Oklahoma, 1914. 42 Okl. 735, 142 Pac. 1099.) 
 
 Action by A. B. Holbert, on written instrument for purchase price of 
 stallion, against C. ' N. Rutherford. Judgment for plaintiff, and de- 
 fendant brings error. Reversed and remanded. 
 
 Thackee, C.° Plaintiff in error will be designated as defendant 
 and defendant in error as plaintiff, in accord with their respective titles 
 in the trial court. 
 
 On July 15, 1911, plaintiff obtained a verdict and judgment against 
 the defendant for $300, with interest thereon at 6 per cent, per annum 
 from May 17, 1910, in an action upon an instrument in writing, which 
 reads as follows: 
 
 "Tishomingo, Okla. May 17, 1910. Seeing it necessary to improve 
 the breed of our horses, we, the undersigned subscribers, hereby pur- 
 chase and agree to pay the sum of $3,000.00 to A. B. Holbert for the 
 English Hackney Stallion Ryedale Evolution. Payments to be made 
 to A. B. Holbert by cash or. joint note, drawing eight per cent, inter- 
 est from date, payable as follows: $1,000.00 one year. $1,000.00 
 two years. $1,000.00 three years. 
 
 "If full amount is not subscribed, this is null and void." 
 
 A. B. Holbert 
 
 M. J. Jester ? 300 00 
 
 0. N. Rutherford 300 00 
 
 Z. T. Burton 300 00 
 
 H. E. Fagan 450 00 
 
 3. A. Ray, Sr 450 00 
 
 O. J. Davis 300 00 
 
 J. H. Duncan ..' 450 00 
 
 R. O. Johnson 300 00 
 
 0. D. Bynum 150 00 
 
 .$3,000 00 
 
 The petition alleged compliance with the foregoing on the part of 
 plaintiff, and that defendant "without any cause refused to execute a 
 
 5 In accord: Philadelphia v. Reeves and Cabot, 48 Pa. 472 (1865) ; Sully v. 
 Campbell, 99 Tenn. 434, 42 S. W. 15, 43 L. R. A. 161 (1897) ; Turley v. Thomas, 
 31 Nev. 181, 101 Pac. 568j 135 Am. St. Rep. 667 (1909) ; Morrison v. American 
 Surety C!<). of New York, 224 Pa. 41, 73 Atl. 10 (1909) ; Mintz v. Tri-County 
 Natural Gas Co., 259 Pa. 477, 103 Atl. 285 (1918) ; Walter v. Rafalsky, 186 . 
 N. X. 543, 79 N. B. 1118 (1906), affirming 113 App. Div. 223, 98 N. Y. Supp. 
 915 (1906). 
 
 ' " Parts of the opinion are omitted. Also reported, with annotations, in L. 
 R. A. 1915B, 221. 
 
Ch. 8) JOINT CONTRACTS 1191 
 
 joint note, and refused to pay the same." The overruling of defend-, 
 ant's demurrer to the petition is assigned as error; and this presents. 
 the question as to whether said instrument is a joint obligation requiring 
 that the action must be brought against all the living joint obligors 
 within the jurisdiction of the court. As between plaintiff and the 
 purchasers of- the stallion the instrument appears to be a joint ob- 
 ligation so as to bind all the obligors' for said $3,000. All the obligors 
 join in a promise to pay him the whole amount to be paid. Davis et 
 al. v. Shafer et al. (C. C.) 50 Fed. 764; Davis & Rankin Bldg. & 
 Mfg. Co. v. Knoke, 55 Minn. 368, 57 N. W. 62; Field v. Runk, 22 
 N. J. Law, 525. 
 
 However, the last sentence of the instrument and the figures set 
 opposite the names of the obligors, characterize the instrument as a 
 species of subscription contract, when completely executed and deliv-. 
 ered, in which as betVeen the obligors, each should pay the amount set 
 opposite his name as the amount of his individual subscription, so that 
 as Jjetween them each is a principal debtor for such amount and a 
 mere surety for his co-obligors in respect to the other portion of the 
 joint indebtedness. It thus appears that while the obligation to plaintiff 
 is a joint one, the instrument discloses a somewhat qualifying state of 
 facts and a special and equitable reason for permitting plaintiff, at his 
 election, to treat it as several as against each obligor to the extent of 
 his individual subscription, that is, it shows that he is a principal debtor 
 as between the joint obligors, and that his co-obligors are his sureties to 
 that extent, and this action deprives him of no right, and the plaintiff 
 only demands of him an amount he is ultimately and in all events 
 bound to pay. 
 
 A joint contract will be treated in equity as joint and several where 
 there is a special and equitable reason for so treating it (9 Cyc. 654, 
 and cases cited in notes) ; and, where a joint contract shows upon its, 
 face that as between the obligors one is ultimately bound as principal 
 for a specified amount and ought to contribute that amount as his 
 share of the indebtedness, he cannot be heard to complain if he is sued, 
 alone for onlv that amount. (Id., and, among others, Pickersgill v. 
 Lahens, 15 Wall. 140, 21 L. Ed. 119.) 
 
 The conclusion we have reached as to the several liability of each of 
 the subscribers seems also to be in accord with and required by sec- 
 tion 877, Stat. 1890 (section 969, Rev. Laws 1910), which reads as.- 
 follows:' "Where all the parties who unite in a promise receive some 
 benefit from the consideration, whether past or present, their promise 
 is presumed to be joint and several." See Schowalter & Gerber v. 
 Beard, 10 Okl. 454, 63 Pac. 687. It thus appears that there was no 
 error in overruling the demurrer to the petition. 
 
 The defendant answered by general denial and further by alleging 
 in effect: * * * (3) that if defendant signed said instrument, he 
 did not deliver it, except upon the condition precedent that the plain- 
 tiff should procure in all ten financially responsible and otherwise, to 
 
1192 JOINT CONTRACTS (Ch. 8 
 
 him and each to all the others, satisfactory subscribers, who, would 
 keep the stallion at Tishomingo; but that the plaintiff failed to pro- 
 cure the requisite satisfactory additional subscribers, and the contract 
 was never consummated, nor any writing thereof unconditionally 
 delivered. Although the answer is somewhat vague and uncertain 
 in this respect, we think it appears therefrom that it -is intended to 
 allege a conditional, if any, delivery in substance and effect as stat- 
 
 A*-l SjS iji ^ , 
 
 The court in effect instructed the jury : (1) That if they found that 
 defendant was induced by fraud or trickery to sign the contract, if 
 they found that he did sign it, their verdict should be for him, other- 
 wise it should be for the plaintiff; (£)*** (3) that if defend- 
 ant signed the contract "he is bound by it, and he cannot escape 
 liability, although he did not read it, and although he thought he was 
 signing a blank paper, if it appears that by the use of reasonable 
 diligence he could have ascertained what the contract was that he was 
 signing, as the law requires every man who can read and write and is 
 in possession of his faculties to use ordinary and accessible means 
 of informing himself of the contents of any instrument that he signs." 
 These instructions eliminate from the issues triable to the jury the 
 question as to whether the contract was completely executed and uncon- 
 ditionally delivered, and are erroneous at least in this respect. 
 
 The last sentence of the contract ("if full amount is not subscribed 
 this is null and void") stated a condition precedent (and not a condition 
 subsequent) to the complete execution and final delivery of the instru- 
 ment sued on as the contract of the parties thereto, and we have thought 
 it a serious question if such an expression in the writing itself does not 
 •exclude all other conditions precedent to its finality; but, although we 
 deem it unnecessary to determine whether this' expressed condition 
 precedent would exclude others wholly repugnant thereto, we think it 
 does not exclude the condition that the plaintiff should procure finan- 
 cially responsible and otherwise satisfactory subscribers who would 
 keep the stallion at Tishomingo, nor any other condition precedent not 
 wholly repugnant to that expressed in the writing. Ware v. Allen et 
 al., 128 U. S. 590, 9 Sup. Ct. 174, 32 L. Ed. 563 ; Golden v. Meier, 129 
 Wis. 14, 107 N. W. 27, 116 Am. St. Rep. 935; Elastic Tip Co. v. 
 Graham, 174 Mass. 507, 55 N. E. 315; Boston Woven Hose & Rub- 
 ber Co. V. Same, 185 Mass. 597, 71 N. E. 117; Wilson v. Powers & 
 Another, 131 Mass. 539; Reynolds v. Robinson, 110 N. Y. 654, 18 
 N. E. 127.^ * * * 
 
 For the reasoiis stated, this case should be reversed and remanded 
 for another trial.* 
 
 T See 4 Wigmore on Evidence, §§ 2408-2410 ; 28 Tale L. Jour. 764-768. 
 
 8 The duties of the promisors were held to be several and not joint in Fell v. 
 Xlcslin, 7 Ex. 185 (1852), "we guarantee that the said sum of £400 shall be 
 duly paid * * * in the proportion of £200 each" ; Gaines Y. Vandecar, 59 
 Or. 187, 115 Pac. 721, 1122 (1911). 
 
 In White v. Tyndall, L. R. 13 App. Cas. 263 (1888), there was a lease to 
 
Ch. 8) JOINT C01)ITEACT8 
 
 1193 
 
 WHELPDALE'S CASE.' 
 (In the King's Bench, 1605. 5 Coke, U9a.) 
 
 In debt by Whelpdale against Whelpdale, which began Hil. 45 
 Eliz. Rot. 1303. The plaintiff declared on a bill obligatory made by 
 the defendant to the plaintiff; the defendant pleaded, non est factum; 
 and the jury found that the bill was a joint bill made by the defendant 
 and another to the plaintiff; and if on the matter the bill mentioned 
 in the declaration be the deed of the defendant, the jurors prayed 
 the advice of the Court. And it was adjudged that the plaintiff should 
 recover. And in this case four points were resolved: 
 
 1. When two men are jointly bound in a bond, although neither of 
 them is bound by himself, yet neither of them can say, that the bond 
 is not his deed, for he has sealed and delivered it, and each of them is 
 bound in the whole. And therefore if they are both sued, and one 
 appears, and the other makes default, and by process of law is out- 
 lawed, he who appears shall be charged with the whole, as appears in 
 40 E. 3. 36. 41 E. 3. 3. But in the case at Bar, he might have pleaded 
 in abatement of the writ, but cannot plead non est factum.^" * * * 
 
 DAVIS V. VAN BUREN. 
 
 (Court of Appeals of New Tork, 1878. 72 N. T. 587.) 
 
 Per Curiam. One Bixbee was arrested at the suit of the plaintiffs, 
 in an action commenced against him by them in the New York 
 Common Pleas, and to procure his discharge from such arrest, he, 
 Benjamin G. Bloss and Jordan Mott, defendant's testator, executed 
 an undertaking as required by section 187 of the old Code. There 
 was default in the undertakings and the plaintiffs then caused a sum- 
 mons to be issued in this action against Bloss and Mott, which was 
 served on Bloss ; before it could be served on Mott he died. Bloss 
 
 George and Albert White as tenants in common, and "the said George White 
 and Albert White do hereby for themselves * * * covenant, promise, and 
 agree * * * that they, or some or one of them will pay." This v^as held 
 to be a joint promise, even though the property interests of George and Al- 
 bert were several and not joint. 
 
 ' Parts of the report relating to collateral matters are omitted. 
 
 ■^"In accord: Stead v. Moon, Cro. Jac. 152 (1604) ; Cabell v. Vaughan, 1 
 Wms. Saund. 291 and note (1669) ; Richards v. Heather, 1 B. & Aid. 29 
 (1817), if the joint obligor who is not named in the writ is dead, the survivors 
 can not plead the general issue, nor can they plead in abatement. 
 
 Where a joint promisor, who is still surviving, is not joined in the action, 
 the defendants can take advantage of the nonjoinder by motion or plea in 
 abatement: Philadelphia v. Reeves & Cabot, 48 Pa. 472 (1865)'; Sundberg v. 
 Goar, 92 Minn. 143, 99 N. W. 638 (1904) ; Bragg v. Wetzel, 5 Blackf. (Ind.) 
 95 (1839). Statutes now generally prevent this, declaring that contracts in 
 terms joint shall in efEect be joint and several. See Stim. Am. St. Law, § 
 4113; N. Y. Code Civ. Proc. §§ 1932, 1946. 
 
1194 JOINT CONTRACTS (Ch. 8 
 
 was afterward discharged in bankruptcy, and the defendant, as ex- 
 ecutor of Mott, was substituted, and the action continued against 
 him. 
 
 The undertaking is a joint obligation. It is so in terms, and we 
 cannot interpolate into it words of severalty. It could have been 
 made joint and several, but it was not. Bloss and Mott were sure- 
 ties. They did not assume a principal obligation; they undertook 
 for another; they had no interest except as sureties, and were enti- 
 tled to all the rights of sureties. This case cannot therefore be dis- 
 tinguished from Wood v. Fisk, 63 N. Y. 245, 20 Am. Rep. 528, and 
 the defendant, as the representative of Mott, cannot be held. It is 
 a rule of the common law, too long settled to be disturbed, that if 
 a joint obligor dying be a surety, not liable for the debt irrespective 
 of the joint obligation, his estate is absolutely discharged, both at 
 law and in equity, the survivor only being liable. Towers v. Moore, 
 2 Vern. 98; Simpson v. Vaughan, 2 Atk. 31; Bradley v. Burwell, 3 
 Denio, 61 ; Richter v. Poppetihausen, 42 N. Y. 393 ; Pickersgill v. 
 Lahens, 15 Wall. 140, 21 L. Ed. 119; Getty v. Binsse, 49 N. Y. 388, 
 10 Am. Rep. 379; Risley v. Brown, 67 N. Y. 160. 
 
 However unjust this rule may be in its general operation we have 
 no right to abrogate it. We must enforce it whenever it is applica- 
 ble and leave to the law-making power any needed change. 
 
 The judgment must be affirmed. All concur. 
 
 Judgment affirmed.^^ 
 
 HALE V, SPAULDING et al. 
 
 (Supreme Judicial Court of Massachusetts, 1888. 145 Mass. 482, 14 N. E. 534, 
 
 1 Am. St. Rep. 475.) 
 
 Contract upon an instrument under seal, dated May 23d, 1885, 
 by the terms of which the defendants, six in number, agreed to pay 
 to the plaintiff on demand, six sevenths of any loss to which he might 
 be subjected as the endorser of a certain note for a corporation. 
 
 Aaron H. Saltmarsh alone defended. He filed an answer alleging 
 that the plaintiff, since the execution of the contract declared on, 
 had executed and delivered the following paper, under seal, to one 
 of the joint obligors under the contract: 
 
 , "Received of E- V. Spaulding $1060.84, in full satisfaction for his 
 liability on the document" signed, etc., and dated May 23d, 1885. 
 
 , 11 The rule that the death of one joint promisor operated as a complete 
 discharge, causing the duty to devolve upon the survivors alone, is nullified 
 by those statutes that declare that joint contracts are to be construed to 
 be joint and several. Stim. Am. St. Law, § 4113 ; N. Y. Code Civ. Proc. § 758. 
 . Although the executor of a deceased joint surety owed no further duty to 
 the creditor, equity would compel him to contribute a pro rata share to any 
 other surety who i>aid the whole. Bradley v. Burwell, 3 Dehio (N Y ) 61 
 (1846). . 
 
Ch. 8) JOINT GONTEACTS 119p 
 
 At the trial in the Superior Court, before Hammond, J., it ap- 
 peared that on September 20th, 1886, the defendants, except Salt- 
 marsh, settled with the plaintiff for their proportionate par;t of the 
 amount alleged to be due under the agreement declared on, and the 
 plaintiff executed the paper under seal, annexe^d to the answer, and 
 delivered it to the defendant Spaulding. The plaintiff offered to 
 prove facts showing that, in giving said sealed paper annexed to 
 the answer, there was no intention of releasing the defendant Salt- 
 marsh. The judge ruled that said offer was not material, and that 
 said sealed paper released the defendant Saltmarsh, and ordered a 
 verdict for the defendant. 
 
 The plaintiff alleged exceptions. 
 
 C. Allen, J. The words "in full satisfaction for his liability" im^ 
 port a release and discharge to Spaulding, and, the instrument be- 
 ing under seal, it amounts to a technical release. The plaintiff does 
 not controvert the general rule that a release to one joint obhgor 
 releases all. Wiggin v. Tudor, 23 Pick. 434, 444 ; Goodnow v. Smith, 
 18 Pick. 414, 29 Am. Dec. 600; Pond v. Williams, 1 Gray, 630, 636. 
 But this result is avoided when the instrument is so drawn as to show 
 a contrary intention. 1 Lindl. Part. 433; 2 Chit. Con. (Uth Am. 
 Ed.) 1154 et seq. Ex parte Good, 5 Ch. D. 46, 55. The difficulty 
 with the plaintiff's case is that there is nothing in the instrument be- 
 fore us to show such contrary intention. Usually a reservation of 
 rights against other parties is inserted for that purpose, or the in- 
 strument is put in the form of a covenant not to sue. See Ken- 
 worthy V. Sawyer, 125 Mass. 28; WiUis v. De Castro, 4 C. B. (N. 
 S.y 216; North v. Wakefield, 13 Q. B. 536, 541. Parol evidence to 
 show the. actual intention is incompetent. Tuckerman v. NewhaU, 
 17 Mass. 581, 585. The instrument given in this case was a mere 
 receipt under seal of money from one of several joint obligors, in 
 full satisfaction for his liability on the document signed by himself 
 and others. There is nothing to get hold of to show an intent to re- 
 serve rights against the others. He might already have discharged 
 each of them by a similar release. 
 
 Exceptions overruled.^^ 
 
 12 In accord: Brooks v. Neal, 223 Mass. 467, m N, E. 78 (1916). The 
 release of one debtor releases all, where the obligation was JOi^t and several 
 ntwPll as where it was joint only. Hochmark v. Richler,.16 Colo. 263, 26 
 Pac 818 a891) ; Ba^k v. DooUttie, 14 Pick. (Mass.) 123 (1833) ; Rowley 
 V sVoddard 7 Johns. (N. 1.) 207 (1810), but a receipt acknowledging pay- 
 ment of a part of the sum due in full of all demands does not operate as a 
 discharge. 
 
H96 JOINT CONTRACTS (Ch. 8 
 
 PRICE V. BARKER et al. 
 (In the Court of Queen's Bench, 1855. 4 El. & Bl. 760, 119 Eng. Eep. 281.) 
 
 CoLBRiDGB, J.^' This was an action by the public officer of a hank- 
 ing Company againstfthe executors of George Hopps. The declara- 
 tion was on a bond conditioned for the security to the bank of a 
 banking account of one William Brown. The plea set out th^ bond, 
 which was the joint and several writing obligatory of the said George 
 Hopps and William Brown, and then set out a general release, made 
 after the accruing of the causes of action, and averred that the release 
 was made in the lifetime of the said George Hopps without the priv- 
 ity, knowledge, authority, or consent of the said George Hopps. The 
 replication set out the release, which, after general words of release, 
 contained the following proviso. "Provided always, that nothing 
 herein contained shall extend, or be deemed or construed to extend, to 
 prevent the said Banking Company, their successors pr assigns, or the 
 partners for the time' being constituting the said Company," "from 
 suing or prosecuting any person or persons, other than the said William 
 Brown, his executors, administrators, or assigns, who is, are, shall or 
 may be liable or accountable to pay or make good to the said Bank- 
 ing Company all or any part of any debt or debts, sum or sums of 
 money, now due from the said William Brown to the said Company, 
 either as drawer, endorser, or acceptor of any bill or bills of exchange 
 or promissory note or notes, or as being jointly or severally bound 
 with the said William Brown in any bond or bonds, obligation or ob- 
 ligations, or other instrument whatsoever, or otherwise howsoever, as 
 if these presents had not been executed: i it being understood and 
 agreed that, as regards any such suits or prosecutions, these presents 
 shall not operate or be pleaded in bar, or as a release." 
 
 To this replication the plaintiff demurred: and the demurrer was 
 argued before us in the course of the last Term. 
 
 On the argument two questions arose : 
 
 1st, Whether the general words of the release were restrained by 
 the proviso, so that, in order to give effect to the whole instrument, we 
 •must construe it as a covenant not to sue, instead of a release. 
 
 And, 2dly, Assuming the deed to operate merely as a covenant not 
 to sue, whether the reservation of rights against other parties than the 
 principal debtor contained in the proviso would prevent the surety 
 from being discharged by a binding covenant to give time to, or not 
 to sue, the principal debtor. 
 
 To entitle the plaintifif to our judgment, it must appear that the 
 deed operated only as a covenant not to sue, and that the rights of 
 the plaintiff as against the surety were preserved by the particular 
 reservation in question, notwithstanding such covenant not to sue. 
 
 13 The statement of the case and argument of counsel are omitted. 
 
Ch. 8) JOINT CONTRACTS 1197 
 
 With regard to the first question, two modes of construction are for 
 consideration. One, that, according to the earlier authorities, the 
 primary intention of releasing the debt is to be carried out, and the 
 subsequent provision for reserving rernedies against co-obligors and 
 co-contractors should be rejected as inconsistent with the intention 
 to release and destroy the debt evinced by the general words of the 
 release, and as something which the law will not allow, as b^ing re- 
 pugnant to such release and extinguishment of the debt. The other, 
 that, according to the modem authorities, we are to mould and 
 limit the general words of the release by construing it to be a cove- 
 nant not to sue, and thereby allow the parties to carry out the whole 
 of their intentions by preserving the rights against parties jointly lia- 
 ble. We quite agree with the doctrine laid down by Lord Denman, in 
 Nicholson v. Revill, 4 A. & E. 675 (E. C. L,. R. vol.. 31), as explained 
 by Baron Parke in Kearsley v. Cole, 16 M'. & W. 136, that, if the 
 deed is taken to operate as a release, the right against a party jointly 
 liable cannot be preserved : and we think that we are bound by mod- 
 ern authorities (see Solly v. Forbes, 2 Br. & B. 38 (E. C. L,. R. vol. 
 6), Thompson v. Lack, 3 Com. B. 540 (E. C. L. R. vol. 54), and Pay- 
 ler v. Homersham, 4 M. & S. 423 (E. C. L. R. vol. 30),) to carry out 
 the whole intention of the parties as far as possible, by holding the 
 present to be a covenant not to sue, and not a release. It is impos- 
 sible to suppose for a moment that the parties to this deed could have 
 contemplated the extinguishment of their rights as against parties 
 jointly liable. It was argued, indeed, that the particular words of the 
 proviso in the present case prevented this construction by appearing 
 to recognise that Brown was not to be sued, and that, in an action 
 against him, the deed was to operate as a release and might be pleaded 
 at bar. The words, however, that the proviso was not to extend to 
 prevent the bank from suing or prosecuting any person or persons 
 other than the said defendant or his representatives, which were said 
 to show that Brown was not to be sued, are quite as applicable to a 
 covenant not to sue as to a release: and the later general words in 
 the conclusion of the deed, "that, as regards any such suits or pros- 
 ecutions" (against parties jointly HaHe), "these presents shall not op- 
 erate or be pleaded in bar," are, we think, like the words of actual 
 release, too general to prevent us hj inference from giving effect to 
 the plainly expressed intention that the parties jointly liable should 
 not be discharged by an extinguishment of the debt. If, therefore, 
 the testator, whom the defendants represent, had been in the situation 
 of co-obligor merely, we should think that he was not discharged by 
 the deed in question. 
 
 It remains, however, in the second place, to consider what effect 
 the deed had upon his liabilities in reference to his relation as sure- 
 ty for Brown, the principal debtor. It was thrown out, indeed, in 
 argument, that we were bound to consider him as a princip^al debtor 
 and not as a surety upon this bond, the obligatory part of the bond 
 
1198 JOINT CONTRACTS (Ch. 8 
 
 being Joint and several without any reference to either being surety 
 or principal. But, for the purpose of seeing the relation of the par- 
 ties, we must look at the condition of the bond, as set out upon the 
 pleadings, which plainly discloses that the defendant was a surety for 
 the' liabilities' of Brown. 
 
 If the question, whether a covenant not to sue, qualified by such 
 a proviso as that in the present case, and entered into by the creditor 
 without the consent of the surety, discharges the surety, were a new 
 one unaffected by authority, we should pause before deciding that 
 such a case does not fall within the general rule of the creditor dis- 
 charging a surety by entering into a binding agreement to give time to 
 his principal debtor; and we should have thought the forcible ob- 
 servations of Lord Truro in the recent case of Owen v. Homan, 3 
 Macn. & G. 378, entitled to much consideration. We find, however, 
 that the Court of Exchequer, in a solemn and well considered judg- 
 ment, in the case of Kearsley v. Cole, 16 M. & W. 128, 136, after re- 
 ferring to all the authoirities, states that the point must "be consid- 
 ered as settled:" and they rest their judgment upon this, although it 
 was not necessary to decide it, as the surety in that case had con- 
 sented to the deed: which consent they treat indeed as an addition- 
 al reason ; but they expressly state that it was not necessary. They 
 state that they "do not mean to intimate any doubt as to the effect 
 of a reserve of remedies without such consent:" and they add that 
 "the cases are numerous that it prevents the discharge of a surety, 
 which would otherwise be the result of a composition with or giv- 
 ing time to a debtor by a binding instrument;" and they then ex- 
 plain how it is that, in their judgment, the reserve of remedies has 
 that effect'. After this judgment, and after the strong expression of 
 opinion by the present Lord Chancellor in his judgment in the House 
 , of Lords' in the case of Owen v. Homan, 4 H. L- Ca. 1037, where 
 he dissents from the remarks made by Lord Truro in the Court 
 below, and states that, but for those remarks, he should have thought 
 that the principle contended for by the plaintiffs was "a matter be- 
 yond doubt," we think that we ought to consider the law on this 
 subject as settled, at least until it is questiohed in a Court of error. 
 
 It seems to be the result of the authorities that a covenant not to 
 sue, qualified by a reserve of the remedies against sureties, is to allow 
 the surety to retain all his remedies over against the principal debtor ; 
 and that the covenant not to sue is to operate only so far as the rights 
 of the surety may not be affected. 
 
 Probably many deeds of this nature are framed continually on the 
 supposition that the law has" been supposed to be settled, in the man- 
 ner stated in the Exchequer, since the time of Lord Eldon: and we 
 think that, sitting as a Court of co-ordinate jurisdiction with the Ex- 
 chequer, we ought not to disturb the law stated by them in a solemn 
 judgment to be clearly settled. . 
 
^^- ^) JOINT CONTRACTS HQQ 
 
 Our judgment, therefore, upon the demurrer in the present case is 
 m favour of the plaintiff. 
 Judgment for the plaintiff.* 
 
 PETERS V. SANFORD & READ. 
 (Supreme Court of New York, 1845. 1 Denio, 224.) 
 Assumpsit, tried at the Delaware circuit in June, 1844, before Rug- 
 gles, C. Judge. The declaration, besides the common money counts, 
 contamed.a count for goods sold and delivered, and the defendants 
 pleaded non assump. On the trial it was admitted that there was a 
 balance due the plaintiff for wool sold to the defendant Read on the 
 29th day of August, 1842, of $300, for which sum Read, on that day, 
 made his note payable to the order of the plaintilB at the Delaware 
 Bank, which note the plaintiff received, and after endorsing it, procur- 
 ed it to be discounted by the bank at which it was payable; that when 
 the note became due it was renewed by another note made by Read and 
 endorsed by the plaintiff, for the same amount ; that the last mentioned 
 note not being paid at maturity, the plaintiff and Read were prosecuted 
 thereon to judgment by the bank,, which judgment was paid by the 
 plaintiff, Read having prior to that time failed. The plaintiff then 
 offered to prove that the defendants were partners in the purchase of 
 the wool for which the first note was given, and that the same was 
 purchased by Read on partnership account. The counsel for Sanford 
 (who alone defended) objected to this evidence, and the circuit judge 
 sustained the objection. The plaintiff then gave evidence to show that 
 Read procured the renewal, after the first note had lain some time un- 
 der protest, and that he paid the expenses on the old and the discount 
 on the new one. It appeared, however, that the plaintiff procured the 
 first note to be discounted and received the money. The plaintiff then 
 renewed his offer to show that the wool was purchased for the copa:rt- 
 nership, and the defendant again objected. The judge ruled as before, 
 stating, however, that he would receive evidence to show why the note 
 was made by one of the partners ; but no such proof being given, the 
 evidence first offered was rejected — the judge holding that the giving 
 of the note by one of the partners, the transfer of it to the bank, and 
 the obtaining of judgment thereon, precluded the plaintiff from recover- 
 ing upon the original transaction ; and he accordingly, on the motion of 
 
 *See, also, Ames' Cases on Suretyship, 147 and note. The Roman Law was 
 similar. Dig. II, 14, 21-23, 32. 
 
 In the case of a joint tort an unqualified release, or other voluntary dis- 
 charge, of one tort-feasor discharges all. See Cormier v. Worcester Consol. 
 St. R. Co., 234 Mass. 193, 125 N. E. 549 (1919). But where the release or dis- 
 charge is qualified by a reservation of rights against the other tort-feasors it 
 operates only as a covenant not to sue and discharges nobody. Carey v. Bilby, 
 129 Fed. 203, 63 C. C. A. 361 (1904) ; Dwy v. Connecticut Co., 89 Conn: 74. 
 92 Atl. 883, L. R. A. 1915E, 800, Ann. Cas. 1918D, 270 (1915) ; Adams Exp. 
 Co. V. Beckwith (Ohio) 126 N. E. 300 (1919). 
 
1200 JOINI CONTRACTS (Ch. 8 
 
 the defendants' ciDunsel, nonsuited the plaintiff. Exceptions were duly 
 taken to the several decisions of the circuit judge, and the case was 
 brought before the court on a bill of exceptions. 
 
 By the Court, JEWETT, J. Assuming that the defendants were part- 
 ners in the purchase of the plaintiff's wool, and as such jointly liable 
 for the payment of the price, still this, action cannot be sustained. The 
 plaintiffs accepted the individual note of Read as a security of the pay- 
 iTient of that debt, he transferred the note by endorsement, and it not 
 being paid at maturity, he as endorser and Read the maker, were sued 
 upon it and judgment was recovered against them. It is well settled, 
 that if a judgment be obtained against one of several joint contractors, 
 in a separate action against him on such contract, the plaintiff cannot 
 afterwards proceed against the parties omitted, and consequently loses 
 their security. It is not necessary that satisfaction should follow the 
 judgment, to work an extinguishment or merger of the liability of the 
 joint contractors; the judgment performs, that office. It cannot vary 
 the principle, that this suit was brought and judgment obtained in the 
 name of the holder, or that the plaintiff was made a defendant with 
 Read. The right of action for the recovery for wool sold and de- 
 livered, is as effectually extinguished by the note and judgment upon 
 it, as it would have been if the plaintiff had obtained a judgment on 
 the note in his own name. The plaintiff could not sustain an action 
 against Read, either for wool sold or' upon the note. The judgment ex- 
 tinguished his right of action upon both. Having paid the judgment, 
 his remedy is by an action against Read for money paid ; but he cannot 
 maintain such an action against Sanford, who was at no time liable to 
 the plaintiff, except in assumpsit for wool sold and delivered ; and his 
 right of action against both defendants for that cause is merged in and 
 extinguished by the judgment. The nonsuit was properly granted. 
 (Robertson v. Smith and others, 18 John. 459, 9 Am. Dec. 227 j Moss v. 
 McCullough, 5 Hill, 131; Pierce v. Kearney, 5 Hill, 85.)" 
 
 New trial denied. 
 
 1* In accord : King v. Hoare, 13 M. & W. 494 (1844) ; Mitchell v. Brewster, 
 28 111. 163 (1862) ; Sully v. Campbell, 99 Tenn. 434, 42 S. W. 15, 43 L. R. A. 
 101 and note (1897) ; Candee v. Smith, 93 N. Y. 349 (1883). A fortiori, a 
 judgment in favor of one joint promisor bars action against the others. Cow- 
 ley V. Patch, 120 Mass. 137 (1876) ; Spencer v. Dearth, 43 Vt. 98 (1870). 
 
 If the contract is in terms joint and several, a judgment against one with- 
 out satisfaction does not bar suit against another. People v. Harrison, 
 82 111. 84 (1876). 
 
 Many states have passed statutes declaring that contracts in terms joint 
 shall be construed to be joint and several, thus preventing the above result. 
 See Mason v. Eldred, infra; Candee v. Smith, supra; SilUy v. Campbell, 
 supra; Stimson, Am. St. Law, §§ 4113, 5015; Black on Judgments, § 208; 
 N. X. Code Civ. Proc. §§ 1932, 1946, 1 A. L. R. 1601, note. "The rule that a 
 judgment upon a joint obligation merges the cause of action, and works a 
 release of a joint obligor against whom no judgment is taken, does not apply 
 to a joint and several note." Giles v. Canary, 99 Ind. 116 (1884), the note 
 read : "I promise to pay." 
 
 in Mason v. Eldred, 6 Wall. 231, 238, 18 L. Ed. 783 (1867), the court said: 
 "A judgment against one upon a joint contract of several persons, bars an ac- 
 
Ch.8) 
 
 JOINT CONTRACTS 1201 
 
 DONNELL et al. v. MANSON et al. 
 (Supreme Judicial Court of Massachusetts, 1872. 109 Mass. 576.) 
 Morton, J." This is an action upon a bond given to dissolve an 
 attachment under the Gen. St. 1860, c. 151, § 15. After the bond was 
 executed two of the obligees died, and the action is brought by the 
 surviving obligees. The defendants object that the suit cannot be 
 maintained without joining the executors or administrators of the 
 deceased_ obligees. But the contract of the defendants is with the ob- 
 ligees jointly ; the form of the contract is joint and the legal interest 
 in the subject matter of the contract is vested iii them jointly. When 
 this is the case the survivors are the proper parties to sue. Anderson 
 V. Martindale, 1 East, 497; Rolls v. Yate, Yelv. 177 (Am. Ed.) and 
 notes; Stowell v. Drake, 23 N. J. Law, 310; Smith v. Franklin, 1 Mass. 
 480. * * * 
 
 SWEIGART V. BERK et al. 
 (Supreme Court of Pennsylvania, 1822. 8 Serg. & R. 308.) 
 
 Action on a bond given by Sweigart to "the widow and heirs and 
 personal representatives of Peter Berk, deceased," with condition to be 
 void "if the said Sweigart should pay to the said widow and heirs and 
 legal representatives £1,000 * * * ^t the death of Margaret Berk, 
 or to the said deceased's heirs and representatives, in equal shares alike, 
 with lawful interest," etc. The plaintiffs' statement showed that the 
 action was brought by seven of the ten living children of Peter Berk, 
 each claiming £100.^* 
 
 TiLGHMAN, C. J. It appears, by the plaintiff's own showing, that 
 the bond was given to ten obligees jointly, all of whom are living, and 
 
 tion against the others, though the latter were dormant partners of the defend- 
 ant in the original action, and this fact was unknown to the plaintiff when that 
 action was commenced. When the contract is joint and not joint and several, 
 the entire cause of action is merged in the judgment. The joint liability of the 
 parties not sued with those against whom the judgment is recovered, being 
 extinguished, their entire liability is gone. They cannot be sued separately, 
 for they have incurred no several obligation ; they cannot be sued jointly 
 with the others, because judgment has been already recovered against the 
 latter, who would otherwise be subjected to two suits for the same cause." 
 The judgment was i$rovable under a plea of the general Issue at common law. 
 
 In Kendall v. Hamilton, 4 App. Cas. 504 (1879), a judgment against a 
 joint debtor was held a bar against a suit against another, even though that 
 other was an undisclosed partner or principal whose existence was not known 
 to the plaintiff at time of his first action. The plaintifC's ignorance of the 
 fact prevented his action from operating as an election, but did not prevent 
 the law of joint undertakings from operating. This is not unjust; for he 
 contracted wholly on the credit of the first defendant. It was mere good 
 luck that he could have held the undisclosed party also ; and it is mere bad 
 luck "that he lost this security before becoming aware of it. 
 
 15 The statement of facts and a part of the opinion are omitted. 
 
 i" The statement of facts Is rewritten. 
 
 COKBIN CONT 76 
 
1202 JOINT CONTRACTS (Ch. 8 
 
 the action is brought by only seven of them. I am at a loss to conceive, 
 on what principle the action can be supported. It is well settled, that 
 if a bond be given to several obligees, they must all join in the action, 
 unless some be dead, in which case, that fact should be averred in the 
 declaration. And if it appear on the face of the pleadings, that there 
 are other obligees living, who have not joined in the action, it is fatal, 
 on demurrer or in arrest of judgment. The authorities to this point 
 are numerous, and will be found collected in 1 Saund. .291 f. The 
 counsel for the plaintiffs has urged the inconvenience of this principle, 
 when applied to the bond in suit, where it appears, by the condition, 
 that ten persons have separate interests, and .it may be, that some of 
 them have received their shares before the commencement of this 
 suit. There is very little weight in that argument. The acceptance of 
 the bond was the voluntary act of the obligees, and if people will enter 
 into contracts which are attended with difficulties, they have no right 
 to expect that established principles of law are to be prostrated, for 
 their accommodation. But in truth, there is very little difficulty in the 
 case. The action may be brought on the penalty of the bond, in the 
 name of all the obligees, and the judgment entered in such a manner 
 as to secure the separate interest of each. The action may be sup- 
 ported, although some of the obligees have received their shares, be- 
 cause the bopd is forfeited, unless they have all been paid. 
 
 It was objected, that those who had been paid might refuse to join 
 in the action, or might release the obligor. But the court would permit 
 those who were unpaid to make use of the names of the other obligees, 
 against their consent; neither would their release be suffered to be set 
 up in bar of the action. It may be resembled to the case of an assigned 
 chose in action, where the action is brought in the name of the as- 
 sig'nor, for the use of the assignee ; there the release of the assignor 
 would not be regarded. A release, in such case, would be a collusion 
 between the assignor and assignee to defraud a third person, and 
 therefore void. It is unnecessary to decide, whether each of ^the ob- 
 ligees in the present case, could have supported a separate action for 
 his separate interest, appearing on the face of the condition. I will 
 only say, that such an action would be hazardous. But this action has 
 not been brought for the separate interest of any one. Seven of the 
 obligees have joined in it. So that it is neither joint nor several. On 
 no principle, therefore, can the action be supported. There were 
 several other points discussed in the argument, in which the court will 
 give no opinion. The judgment of the Court of Common Pleas must be 
 reversed, and restitution is awarded. 
 
 Judgment reversed and restitution awarded. ^^ 
 
 17 That an action is not maintainable by less than all of the joint promisees, 
 see_ Wetherell v. Langston, 1 Ex. 634 (1847), even though one promisee had 
 never assented and expressly disclaimed any rights; Angus v. Robinson, 59 
 Vt. 585, 8 Atl. 497, 59 Am. Rep. 758 (1887), where one promisee had been 
 paid his share and did not join for that reason. Under modern procedure. 
 
Ch. 8) JOINT CONTRACTS 1203 
 
 JElvL V. DOUGLAS. 
 (In the Court of King's Bench, 1821. 4 Barn. & Aid. 374.) 
 
 Assumpsit for goods sold and delivered by Jell to the defendant. 
 Plea, general issue. At the trial, before Abbott, C. J., at the last sum- 
 mer assizes for the county of Kent, the proof was that the goods 
 were sold_ to the defendant by the plaintifif and his son, who were in 
 partnership. The son had died before the commencement of this 
 action. It was contended that this was a variance, inasmuch as the 
 contract stated in the declaration was with the plaintifiE alonej where- 
 as that given in evidence was with the plaintiff and another. Abbott, 
 C. J., reserved the point, and directed the jury to ftnd a verdict for 
 the plaintiff, \vith liberty to the defendant to move to enter a nonsuit. 
 .A rule nisi was obtained for that purpose. 
 
 Abbott, C. J. It is a well-established rule, that where two persons 
 are joint-sellers of goods, they must both join in an action brought 
 to recover the price. It was decided in Richards v. Heather, 1 Barn. 
 & Aid. 29, that a party may maintain an action against a surviving 
 partner without describing him as such; and the reason of that de- 
 cision was this, that if the partners had been alive, and one only was 
 sued, that circumstance could only be taken advantage of by plea in 
 abatement, and wasno defence upon the general issue. But if one of 
 two joint-contractors sue, both being alive, that is a variance, and a 
 good defence upon the general issue. It seems, therefore, to be rea- 
 sonable, that where a surviving joint-contractor sues, the fact of his 
 being survivor should appear in th-e declaration. In a note to Webber 
 v. Tivill, 2 Saund. 121, n. 1, M,V. Serjt. Williams lays it down, that it 
 is necessary that all the persons with whom a contract has been made, 
 if living, should join in the action, and if any of them are dead, that 
 fact should be stated. From niy own experience I can say that that 
 has been the general practice, and I think it ought not to have been 
 departed from in this instance. The rule for a nonsuit must be made 
 absolute. 
 
 Rule absolute.^* 
 
 if one promisee refuses to join, he may be joined as a codefendant, and the 
 proper judgment rendered. CuUen v. Knowles, [1898] 2 Q. B. 380. 
 
 An absolute discharge given by any one joint promisee operates as a dis- 
 charge against all the promisees, in the absence of fraud. Wallace v. Kelsall, 
 7 M. & W. 264 (1840) ; Osbom v. Martha's Vineyard -R. Co., 140 Mass. 549, 
 5 N. E. 486 (1886) ; Bawstome v. Gandell, 15 M. & W. 304 (1846) ; Pierson 
 V. Hooker, 3 Johns. (N. Y.) 68, 3 Am. pec. 467 (1808). 
 
 18 If one of two joint promisors is sued alone, and the defect of parties 
 appears in the declaration, the defendant may properly demur. State of 
 Maine v. Chandler, 79 Me. 172, 8 Atl. 553 (1887). If the defect does not so 
 appear, the defendant may plead in abatement, but a plea of the general 
 issue wiU not be sustained: Richards v. Heather, 1 Bam. & Aid. 29 (1817) ; 
 Ames' Cases on Pleading, 142, note. 
 
 If one of two joint promisees sues alone, and the defect appears, the de- 
 fendant may properly demur or move in arrest of judgment. In any case 
 
1204 JOINT CONTRACTS (Ch. 8 
 
 ANDERSON et al. v. NICHOLS. 
 (Supreme Court of Vermont, 1919. 107 Atl. 116.) 
 
 Action of contract by George Anderson and seven others against 
 E. M. Nichols. Demurrer to declaration was sustained, declaration 
 adjudged insufficient, and judgment for defendant, and plaintiffs bring 
 exceptions. Judgment affirmed. 
 
 The declaration, in substance, alleges that on October 5, 1915, the 
 defendant owned and maintained an electric light and power transmis- 
 sion line and the plaintififs were- the owners of certain farms in the 
 towns of Glover and Albany, and desired the defendant to extend his 
 electric power t^nsmission line to their buildings so that they could 
 secure "electric current for lighting and power purposes to be used 
 upon their said farms"; that on said October 5, 1915, they entered 
 into a contract with the defendant to extend his transmission line 
 from one Grant White's for the purpose of furnishing them electric 
 current, and they "then and tBere severally promised and agreed to 
 and with the said defendant to pay to said defendant the sum of $125 
 each when said transmission line should be constructed to a point 
 opposite their buildings, and $125 each when their buildings should 
 be by said defendant properly wired and equipped for turning on said 
 electric current"; that the defendant erected said transmission line 
 and wired the buildings of the plaintififs, and they each paid him the 
 sum of $250, amounting in the whole to the sum of $2,000, "and all 
 in accordance with the terms of said contract." 
 
 The declaration further alleges that in said contract the defendant 
 promised and agreed to and with the plaintiffs "that if, during the 
 life of said con|:ract, any person living on said transmission line as 
 constructed under said contract desired to obtain electric current of 
 and from the said defendant, he, the said defendant, would charge said 
 person $250 for connecting said person's buildings with said trans- 
 mission line, one half of which $250 should be retained by the said 
 defendant, and the other haH equally divided by the said defendant 
 between the plaintiffs and other persons whose buildings should there- 
 after be connected with said transmission line under said agreement" ; 
 that, since the construction of said transmission line under said con- 
 tract the defendant has connected with said transmission line the 
 store of W. R. Graham and E. J. Douglas ih the village of South 
 Albany and the buildings of Lynn Anderson in Glover, said persons 
 then and there living on and adjacent to said transmission line ; that 
 "the said defendant, not regarding said promises, agreements, and 
 undertakings to and with the plaintiffs, neglected and refused to pay 
 these plaintiffs their said several shares of money accruing to them 
 under the terms of said contract and by reason of the said defendant 
 
 the general issue is proper (except by statute). See Ames' Cases on Plead- 
 ing, 138, note. 
 
Cll. 8) JOINT CONTRACTS 1205 
 
 having connected with said transmission line the buildings of the said 
 Lynn Anderson and the store of the said Graham^ and Douglas." 
 
 The ground of demurrer'is that there is a misjoinder of plaintififs, 
 for that the contract declared upon is, as to them, several, and not 
 joint. 
 
 Powers, J." If you contract with two or more jointly, and their 
 interests are several only, your engagement, in the absence of control- 
 ling language, will be taken to be several, and each promisee should 
 sue separately for his damages. Note, Saund. 154; Beckwith v. Tal- 
 bot, 95 U. S. 289, 24 h. Ed. 496; Emmduth v. Home Benefit Ass'n 
 122 N. Y. 130, 25 N. E. 234, 9 L. R. A. 704. This rule of the common 
 law was, at an early day, approved and adopted as the law of this 
 jurisdiction. In Geer v. School District, 6 Vt. 76, Judge Mattock says, 
 in effect, that in all actions on contracts suit must be brought in the 
 name of the party who has the legal interest, though the form of the 
 undertaking might require some one else to sue. And in Sharp v. 
 Conkling, 16 Vt. 355, Judge Redfield, upon a consideration of the 
 common-law authorities, asserts the fully established rule to be that, 
 if the interest in the subject-matter secured by the contract is several, 
 though the terms thereof are joint, the engagement will be taken to 
 be several, unless such interpretation is excluded by the language 
 used. 
 
 So it is that, when the promise is to pay a group of persons a stated 
 sum to be divided among them in proportions named, the engage- 
 ment, ordinarily, will be joint, and not several. 1 Parsons, *13 ; Lane 
 v. Drinkwater, 1 C., M. & R. 599; Byrne v. Fitzhugh, 1 C, M. & R. 
 613. 
 
 On the other hand, when payment is to be made not to the group, 
 but to its several members, each to receive from the promisor his own 
 share, the engagement, ordinarily, will be several, and not joint. 1 
 Parsons, *19; Owings' Ex'rs v. Owings, 1 Har. & G. 484. 
 
 When tested by the above rule, the complaint before us breaks 
 down. The interests of these plaintiffs are several. The consideration 
 for the defendant's promise moved from them, not jointly, but sever- 
 ally; and this alone is enough to make that -promise prima facie 
 several. 2 Page, § 1142; Satler Lumber Co. v. Exler, 239 Pa. 135, 
 86 Atl. 793. Moreover, the contract set up in this complaint does 
 not require the defendant to pay the sum specified t||the plaintiffs, 
 but binds him to divide it between them. So the defertdant's promise, 
 though joint in form, is several in essence. In legal consequence, it 
 is a group of se'parate promises, and gives rise to separate actions in 
 favor of the several promisees. * * * 
 Judgment afifirmed.^" 
 
 18 Part of the opinion is omitted. 
 
 20 In Keightley v. Watson, 3 Ex. 716 (1849), and Tompkins v. Sheehan, 158 
 N. T. 617, 53 N. E. 502 (1899), the interests of the parties were several and 
 the contract was held to be several, so that one promisee could sue alone. . 
 
 The rights of the promisees were held to be joint in Lane v. Drinkwater, 
 
1206 ILLEGAL CONTBACTS (Cll. 9 
 
 CHAPTER IX 
 ILLEGAL CONTRACTS 
 
 SECTION 1.— RESTRAINT OF TRADE 
 
 BROAD V. JOLLYFE. 
 (In the King's Bench, 1620. Cro. Jac. 596.) 
 
 Assumpsit. Whereas the defendant was a mercer, and kept a shop 
 at Newport in the Isle of Wight, and liad his shop furnished with di- 
 vers old and sullied wares, and the plaintiff had a shop there furnished 
 with new and fresh wares ; in consideration the plaintiff would buy of 
 him all his said wares in the said shop, and would pay for them such 
 prices as he paid for them when he first bought them, that he assumed 
 he would not then any longer keep a mercer's shop in Ne^yport : arid 
 alledges in fact, that he bought of him all his said wares, and paid to 
 him three hundred pounds for them, being the price which he had paid 
 for the said wares when he bought them, whereas in truth they were 
 not then worth one hundred pounds ; and that the defendant contrary 
 to his promise kept his said shop, and furnished it with new and fresh 
 wares, &c. to the plaintiff's damage five hundred pounds. After non 
 assumpsit pleaded, and verdict for the plaintiff to his damage of forty 
 pounds. 
 
 It was moved in arrest of judgment, that this assumpsit is against 
 law, to restrain any to use their lawful trade: and for that purpose 
 was cited 2 Hen. 5. pi. 5. where an obligation that one shall not use 
 the trade of a dyer was held to be void. 
 
 1 Cr. M. & R. 599 (1834) ; Sorsbie v. Park, 12 M. & W. 147 (1843) ; Nabors 
 v. Producers Oil Co., 140 La. 985, 74 South. 527, L. K. A. 1917D, 1115 (1917). 
 
 If the words are ambiguous, the contract will be construed to be joint if 
 the interests of the parties are joint, and to be several if otherwise. Inter- 
 national Hotel Jip. V. Flynn, 238 111. 636, 87 N. E. 855, 15 Ann. Gas. 1059 (1909) : 
 Spangenberg v.~'Spangenberg, 19 Cal. App. 439, 126 Pac. 379 (1912), held 
 several; Atlanta & St. A. B. R. Co. v. Thomas, 60 Fla. 412, 58 South. 510 
 (1910); Gaines v. Vandecar, 59 Or. 187, 115 Pae. 721, 1122 (1911), held 
 several as to promisors; Satler Lumber Co. v. Exler, 239 Pa. 135, 86 Atl. 
 793 (1913) ; Shipman v. StraitsvUle Central Min. Co., 158 U. S. 356, 15 Sup. 
 Ct. 886, 39 L. Ed. 1015 (1894). 
 
 Covenantees may be joint or they may be several, according to their in- 
 terests, but they cannot be both joint and several. Slingsby's Case, 5 Co. 
 18b (1588) ; Bradburne v. Botfield, 14 M. & W. 559 (1845) ; Keightley v. 
 Watson, supra; Eveleth v. Sawyer, 96 Me. 227, 52 Atl. 639 (19(K). Several 
 promisees cannot maintain separate aqtions, where their interests are joint, 
 and there was only one promise, requiring a single undivided performance. 
 AnSerson v. Martindale, 1 East, 497 (1801). 
 
Sec. 1) RESTRAINT OF TRADE 
 
 1207 
 
 Houghton, Justice, was of that opinion, for the reason above-men- 
 tioned : but all the other justices held, that it was good assumpsit, for 
 It IS voluntary ; and upon a valuable consideration one may restrain 
 himself that he shall not use his .trade in such a particular place ; for 
 he who gives that consideration expects the benefit of his customers ; 
 and.it is usual here in London for one to let his shop and wares to his 
 servant when he is out of his apprenticeship; as also to covenant that 
 he shall not use that trade in such a shop, or in such a street : so for a 
 valuable consideration, and voluntarily, one may agree that he will not 
 use his trade; for volenti non fit injuria. And it is not like to the 
 case in 2 Hen. 5, before cited; for there it is alledged, that he was 
 compelled to enter into such a bond, it being an offence for which Hull 
 swore he would have committed him had he been there ; yet there the 
 issue is taken, that he did not use the trade of a dyer in the said vill ; 
 which proves, that the defendant durst not demur thereupon; but, the 
 bond was allowed good. But here it is upon a good consideration, viz. 
 that he should pay three hundred pounds for wares which were "not 
 worth one hundred and fifty pounds, for which he made the said prom- 
 ise, and is strong enough against himself. 
 
 Montague, Chief Justice, cited the case in 13 Hen. 7. If a feoff- 
 ment be made upon condition that he shall not alien, it is a void con- 
 dition, for it is against law : yet a covenant that he shall not alien, is 
 good : wherefore it was adjudged for the plaintiff. — And in Michael- 
 mas term, 19 Jac. 1. this judgment was affirmed in a writ of error 
 before all the justices and Barons of the Exchequer; for they held, 
 that one may voluntarily give over his trade, and is not compellable to 
 use it, especially in one certain place : and therefore he may, upon good 
 consideration, agree that he will not use it within such a vill ; and up- 
 on the matter, it is but the selling of his custom, and leaving -another 
 to gain it. And it was said, that a prescription to restrain one from 
 using a trade in such a place is good. Easter term, 18 Jac. 1. Bragg 
 V. Tanner assumpsit for ten shillings he promised to pay an hundred 
 pounds, if he thenceforward kept any draper's shop in Newgatemar- 
 ket : judged good, and the plaintiff recovered.^ 
 
 1 In Mitchell v. Reynolds, 1 Peere "VVms. 181 (1711), often cited as a lead- 
 ing case, the defendant had assigned to the plaintifE a lease of a messuage and 
 bakehouse for a term of five years, and gave a bond conditioned not to en- 
 gage in the trade of a baker within that parish during the five years. The 
 defendant did engage in the trade and was sued in debt in the bond. The 
 court gave judgment for the plaintiff, and classified restraints on trade at 
 great length. Parker, C. J., said : "And we are all of opinion, that a 
 special consideration being set forth in the condition, which shows it was 
 reasonable for the parties to enter into it, the same is good ; * * * and that 
 wherever a suflBcient consideration appears to make it a proper and useful 
 contract, and such as cannot be set aside without injury to a fair contractor, 
 it. ought to be maintained; but with this constant diversity, viz. where the 
 restraint is general not to exercise a trade throughout the kingdom, and where 
 it is limited to a particular place; for the former of these must be void, 
 being of no benefit to either party, and only oppressive." 
 
1208 ILLEGAL CONTRACTS (Ch. 9 
 
 DIAMOND MATCH CO. v. ROEBER. 
 
 (Court of Appeals of New York, 1887. 108 N. Y. 473, 13 N. E. 419, 60 Am. 
 
 Rep. 464.) 
 
 Andrews, J.^ Two questions are presented — First, whether the 
 covenant of the defendant contained in the bill of sale executed by 
 him to the Swift & Courtney & Beecher Company on the twenty- 
 seventh day of August, 1880, that he shall arid will not at any time or 
 times within 99 years, directly or indirectly engage in the manufac- 
 ture or sale of friction matches (excepting in the capacity of agent 
 or employe of the said Swift & Courtney & Beecher Company) with- 
 in any of the several states of the United States of America, or in 
 the territories thereof, or within the District of Coluinbia, excepting 
 and reserving, however, the right to manufacture and sell friction 
 matches in the state of Nevada, and in the territory of Montana, is 
 void as being a covenant in restraint of trade; and, second, as to 
 the right of the plaintifif, under the special circumstances, to the 
 equitable remedy by injunction to enforce the performance of the 
 covenant. 
 
 There is no real controversy as to the essential facts. The con- 
 sideration of the covenant was the purchase by the Swift & Courtney 
 & Beecher Company, a Connecticut corporation, of the manufactory 
 No. 528 West Fiftieth street, in the city of New York, belonging to 
 the defendant, in which he had, for several years prior to entering 
 into the covenant, carried on the business of manufacturing friction 
 matches, and of the stock and materials on hand, together with the 
 trade, trade-marks, and good-will of the business, for the aggre- 
 gate sum (excluding a mortgage of $5,000 on the property assumed 
 by the company) of $46,724.05, of which $13,000 was the price of 
 the real estate.- By the preliminary agreement of July 27, 1880, 
 $28,000 of the purchase price was to be paid in the stock of the Swift 
 & Courtney & Beecher Company. This was modified when the 
 property was transferred, August 27, 1880, by giving to the defend- 
 ant the option to receive the $28,000 in the notes of the company 
 or in its stock, the option to be exercised on or before January 1, 
 1881. The remainder of the purchase price, $18,724.05, was paid 
 down in cash, and subsequently, March 1, 1881, the defendant ac- 
 cepted from the plaintifif, the Diamond Match Company, in full pay- 
 ment of the $28,000, the sum of $8,000 in cash and notes, and $20,- 
 000 in the stock of the plaintifif; the plaintifif company having prior 
 to said payment purchased the property of the Swift & Courtney & 
 Beecher Company, and become the assignee of the defendant's cov- 
 enant. 
 
 It is admitted by the pleadings that in August, 1880, (when the 
 covenant in question was made), the Swift & Courtney & Beech- 
 
 2 Part of the opinion is omitted. 
 
Sec. 1) RBSTKAINT OF TRADE 1209 
 
 er Company carried on the business of manufacturing friction match- 
 es in the states of Connecticut, Delaware, and Illinois, and of sellin? 
 the matches which it manufactured "in the several states and terri- 
 tories of the United States, and in the District of Columbia ;" and 
 the complaint alleges and the defendant- in his answer admits that 
 he was at the same time also engaged in the manufacture of friction 
 matches in the city of New York, and in selling them in the same 
 territory. The proof tends to support the admission in the plead- 
 ings. It was shown that the defendant employed traveling sales- 
 men, and that his matches were found in the hands of dealers in 
 10 states. The Swift & Courtney & Beecher Company also sent 
 their matches throughout the country wherever they could find a 
 market. When the bargain was consummated, on the twenty-sev- 
 enth of August, 1880, the defendant entered into the employment of 
 the Swift & Courtney & Beecher Company, and remained in its 
 employment until January, 1881, at a salary of $1,500 a year. He 
 then entered into the employment of the plaintiff, and remained with 
 it during the year 1881, at a salary of $2,500 a year, and from Jan- 
 uary 1, 1882, at a salary of $3,600 a year, when, a disagreement 
 arising as to the salary he should thereafter receive, the plaintiff 
 declining to pay a salary of more than $2,500 a year, the defendant 
 voluntarily left its service. Subsequently he became superintendent 
 of a rival match manufacturing company in New Jersey, at a sal- 
 ary of $5,000, and he also opened a store in New York for the sale 
 of matches other than those manufactured by the plaintiff. 
 
 The contention by the defendant that the plaintiff has no equitable 
 remedy to enforce the covenant, rests mainly on the fact that con- 
 temporaneously with the execution of the covenant of August 27, 
 1880, the defendant also executed to the Swift & Courtney & Beech- 
 er Company a bond in the penalty of $15,000, conditioned to pay 
 that sum to the company as liquidated damages in case of a breach 
 •of his covenant. 
 
 The defendant for his main defense relies upon the ancient doc- 
 trine of the common law, first definitely declared, so far as I can dis- 
 cover, by Chief Justice Parker (Lord Macclesfield) in the leading 
 case of Mitchel v. Reynolds, 1 P. Wms. 181, and which has been re- 
 peated many times by judges in England and America, that a bond 
 in general restraint of trade is void. There are several decisions in 
 the English courts of an earlier date, in which the question of the 
 validity of contracts restraining the obligor from pursuing his oc- 
 cupation within a particular locality was considered. The cases 
 are chronologically arranged and stated by Mr. Parsons in his work 
 on Contracts (volume 2, p. 748, note.) The earliest reported: case, 
 decided in the time of Henry V., was a suit on a bond given by the 
 •defendant, a dyer, not to use his craft within a certain pity for the 
 space of half a year. The judge before whom the case came indig- 
 
1210 ILLEGAL CONTRACTS (Ch. 9 
 
 nantly denounced the plaintiff for procuring such a contract, and 
 turned him out of court. This was followed by cases arising on 
 contracts of a similar character, restraining the obligors from pur- 
 suing their trade within a certain place for a certain time, which ap- 
 parently presented the same question which had been decided in 
 the dyer's case, but the courts sustained the contracts, and gave 
 judgment for the plaintiffs ; . and before the case of Mitchel v. Rey- 
 nolds it had become' settled that an obligation of this character, lim- 
 ited as to time and space, if reasonable under the circumstances, and 
 supported by a good consideration, was valid. The case in the Year 
 Books went against all contracts in restraint of trade, whether lim- 
 ited or general. The other cases prior to Mitchel v. Reynolds sus- 
 tained contracts for a particular restraint, upon special grounds, and 
 by inference decided against the validity of general restraints. The 
 case of Mitchel v. Reynolds was a case of partial restraint, and the 
 contract was sustained. 
 
 It is worthy of notice that most, if not all, the English cases 
 which assert the doctrine that all contracts in general restraint of 
 trade are void, were cases where the contract before th? court was 
 Hmited or partial. The same is generally true of the American cas- 
 es. The principal cases in this state are of that character, and in all 
 of them the particular contract before the court was sustained. 
 Nobles V. Bates, 7 Cow. 307; Chappel v. Brockway, 21 Wend. 157; 
 Dunlop v. Gregory, 10 N. Y. 241, 61 Am. Dec. 746. In Alger v. 
 Thacher, 19 Pick. 51, 31 Am. Dec. 119, the case was one of general 
 restraint, and the court, construing the rule as inflexible that all 
 contracts in general restraint of trade are void, gave judgment for 
 the defendant. In Mitchel v. Reynolds the court, in assigning the 
 reason for the distinction between a contract for the general restraint 
 of trade and one limited to a particular place, says : "for the former 
 of these must be void, being of no benefit to either party, and only 
 oppressive ;" and later on, "because in a great many instances they 
 can be of no use to the obligee, which holds in all cases of general 
 restraint throughout England ; for what does it signify to a trades- 
 man in London what another does in Newcastle, and surely it would 
 be unreasonable to fix a certain loss on one side without any bene- 
 fit to the other." He refers to other reasons, viz., the mischief which 
 may arise (1) to the party by the loss by the obligor of his livelihood 
 and the substance of his family, and (2) to the pubHc by depriving it 
 of a useful member, and by enabling corporations to gain control 
 of the trade of the kingdom. It is quite obvious that some of these 
 reasons are much less forcible now than when Mitchel v. Reynolds 
 was decided. Steam and electricity have for the purposes of trade 
 and commerce almost -annihilated distance, and the whole world is 
 now a mart for the distribution of the products of industry. The 
 great diffusion of wealth, and the restless activity of mankind striv- 
 
Sec. 1) EESTEAINT OF TRADE 1211 
 
 ing to better their condition, have greatly enlarged the field of hu- 
 man enterprise, and created a vast number of new industries, which 
 gives scope to ingenuity and employment for capital and labor. 
 The laws no longer favor the granting of exclusive privileges, and 
 to a great extent business corporations are practically partnerships, 
 and may be organized by any persons who desire to unite their cap- 
 ital or skill in business, leaving a free field to all others who desire 
 for the same or similar purposes to clothe themselves with a cor- 
 porate character. The tendency of recent adjudications is marked 
 in the direction of relaxing the rigor of the doctrine that all contracts 
 in general restraint of trade are void, irrespective of special circum- 
 stances. Indeed, it has of late been denied that a hard and fast 
 rule of that kind has ever been the law of England. Rousillon v. 
 Rousillon, 14 Ch. Div. 351. 
 
 The law has for centuries permitted contracts in partial restraint 
 of trade, when reasonable; and in Horner v. Graves, 7- Bing. 735, 
 Chief Justice Tindal considered a true test to be "whether the re- 
 straint is such only as to afford a fair protection to the interests of 
 the party in favor of whom it is given, and not so large as to inter- 
 fere with the interests of the public." When the restraint is gener- 
 al, but at the same time is co-extensive only with the interest to be 
 protected, and with the benefit meant to be conferred, there seems 
 to be no good reason why, as between the parties, the contract is 
 not as reasonable as when the interest is partial, and there is a cor- 
 responding partial restraint. And is there any real public interest 
 which necessarily condemns the one, and not the other? It is an 
 encouragement to industry and to enterprise in building up a trade, 
 that a man shall be allowed to sell the good-will of the business and 
 the fruits of his industry upon the best terms he can obtain. If 
 his business extends over a continent, does public policy forbid 
 his accompanying the sale with a stipulation for restraint co-ex- 
 tensive with the business which he sells? If such a contract is per- 
 mitted, is the seller any more likely to become a burden on the pub- 
 lic than a man who, having built up a local trade only sells it, bind- 
 ing himself not to carry it on in the locality ? Are the opportunities 
 for employment and for the exercise of useful talents so shut up 
 and hemmed in that the public is likely to lose a useful member of 
 society in the one case, and not in the other ? Indeed, what public 
 policy requires is often a vague and difficult inquiry. It is clear that 
 public policy and the interests of society favor the utmost freedom 
 of contract, within the law, and require that business transactions 
 should not be trammeled by unnecessary restrictions. "If," said 
 Sir George Jessell in Printing Co. v. Sampson, L. R. 19 Eq. 462, 
 "there is one thing more than any other which public policy requires, 
 it is that men of full age and competent understanding shall have 
 the utmost liberty of contracting/ and that contracts, when entered 
 
1212 ILLEGAL CONTRACTS (Ch. & 
 
 into freely and voluntarily, shall be held good, and shall be enforced 
 by courts of justice." ' 
 
 It has sometimes been suggested that the doctrine that contracts 
 in general restraint of trade are void, is founded- in part upon the 
 policy of preventing monopolies, which are opposed to the liberty of 
 the subject, and the granting of which by the king under claim of 
 royal prerogative led to conflicts memorable in English history. 
 But covenants of the character of the one now in question operate 
 simply to prevent the covenantor from engaging in the business 
 which he sells, so as to protect the purchaser in the enjoyment of 
 
 8 " 'Public policy', said Burrougb, J. (I believe quoting Hobart, 0. J.), 'is 
 an unruly horse and dangerous to ride.' 1 quote also another distinguished 
 judge (more modern), Cave, J., 'Certain kinds of contracts have been held 
 void at common law on the ground of public policy; a branch of the law, 
 however, which certainly should not be extended, as, judges are more to be 
 trusted as interpreters of the law than as expounders of what is called public 
 policy.' I think the present case is an illustration of the wisdom of these 
 remarks. I venture to make another. No evidence is given in these public 
 iwlicy cases. The tribunal is to say, as matter of law, that the thing is 
 against public policy and void. How can the jud^e do that without any evi- 
 dence as to its effect and consequences?" Bramwell, L. J., in Mogul S. S. 
 Co. V. McGregor, [1892] A. C. 25. 
 
 There seems to be no reason why judges should not require "evidence" on 
 the subject before making a decision. It may also be remarked that, however 
 unruly the horse may be, it is not possible for the courts to refuse to ride. 
 Justice (whether described as "natural" or artificial), public policy, general 
 welfare, the settled convictions of mankind, community ideals, are all modes 
 of describing substantially the same thing. It is this that the courts are 
 estjablished to administer, and upon which in the last analysis their judgments 
 are based. 
 
 In Hyams v. King, [1908] 2 K. B. 696, Sir G. Barnes, P., said : "It is neces- 
 sary to avoid confusion between judicial and legislative functions * * » 
 care must be taken not to lay down new principles of public policy without 
 sufiScient warrant." It should be needless to suggest with what conservative 
 care this great judicial function should be exercised. 
 
 In Rodriguez v. Speyer Bros., 119 L. T. 409 (1918), Lord Haldane said: 
 "I think there are many things of which the judges are bound to take judi- 
 cial notice which lie outside the law properly so called, and among those 
 things are what is called public policy and the changes which take place in 
 it. The law itself may become modified by this obligation of the judges." 
 
 In WiLson v. Camley, [1908] 1 K. B. 729, 738, Vaughan Williams, L. J., 
 partly quoting Lord Bowen, said : "The determination of what is contrary to 
 the so-called 'policy of the law' necessarily varies from time to time. Many 
 transactions are upheld now by our own courts which a former generation 
 would have avoided as contrary to the supposed policy of the law. The rule 
 remains, but its application variesi with the principles which for the time 
 being guide public opinion. I cannot myself in the least acquiesce in the 
 suggestion that, as habits change and time goes on, we may not find new 
 instances of contracts ' which cannot be enforced on the ground that they are 
 contrary to public morality." 
 
 For conservative statements, see Baron Parke, in Egerton v. Brownlow, 
 4 H. L. C. 1, 122 (1833), and Halsbury, L. C, in Janson v. Driefontein Mines, 
 [1902] A. C. 484, 491. See article by John B. Waite, "Public Policy and 
 Personal Opinion" (1921) 19 Mich. L. Rev. 265. 
 
 In Dr. Miles Medical Co. v. John D. Park & Sons Co., 220 U. S. 373, 31 Sup. 
 Ct. 876, 55 L. Ed. 502 (1911), Mr. Justice Holmes said: "I think that at 
 least it is safe to say that the most enlightened judicial policy is to let 
 people manage their own business in their own way, unless the ground for 
 interference is very clear." 
 
Sec. 1) RESTHAINT OF TRADE 1213 
 
 what he has purchased. To the extent that the contract prevents 
 the vendor from carrying on the particular trade, it deprives the 
 community of any benefit it might derive from his entering into com- 
 petition. But the business is open to all others, and there is little 
 danger that the public will suffer harm from lack of persons to en- 
 gage in a profitable industry. Such contracts do not create monopo- 
 lies. They confer no special or exclusive privilege. If contracts in 
 general restraint of trade, where the trade is general, are void as tend- 
 ing to monopolies, contracts in partial restraint, where the trade is 
 local, are subject to the same objection, because they deprive the 
 local community of the services of the covenantor in the particular 
 trade or calling, and prevent his becoming a competitor with the 
 covenantee. We are not aware of any rule of law which makes the 
 motive of the covenantee the test of the validity of such a contract. 
 On the contrary, we suppose a party may legally purchase the trade 
 and business of another for the very purpose of preventing compe- 
 tition, and the validity of the contract, if supported by a considera- 
 tion, will depend upon its reasonableness as between the parties. 
 Combinations between producers to limit production, and to en- 
 hance prices, are or may be unlawful, but they stand on a different 
 footing. * * * 
 
 In the present state of the authorities, we think it cannot be said 
 that the early doctrine that contracts in general restraint of trade 
 are void, without regard to circumstances, has been abrogated. But 
 it is manifest that it has been much weakened, and that the founda- 
 tion upon which it was originally placed has, to a considerable extent 
 at least, by the change of circumstances, been removed. The cov- 
 enant in the present case is partial, and not general. It is practically 
 unlimited as to time, but this under the authorities is not an objec- 
 tion, if the contract is otherwise good. Ward v. Byrne, 5 Mees. & 
 W. 548; Mumford v. Gething,' 7 C. B. (N. S.) 317. It is limited as 
 to space since it excepts the state of Nevada and the territory of 
 Montana from its operation; and therefore is a partial and not a 
 general, restraint, unless, as claimed by the defendant, the fact that 
 the covenant applies to the whole of the state of New York consti- 
 tutes a general restraint within the authorities. In Chappel v. Brock- 
 way, supra, Bronson, J., in stating the general doctrine as to con- 
 tracts in restraint of trade, remarked that "contracts which go to 
 the total restraint of trade, as that a man will not pursue his occu- 
 pation anywhere in the state, are void." The contract under consid- 
 eration in that case was one by which the defendant agreed not to 
 run or be interested in a line of packet-boats on the canal bet-ween 
 Rochester and Buffalo. The attention of the court was not called to 
 the point whether a contract was partial, which related to a business 
 extending over the whole country, and which restrained the carry- 
 ing on of business in the state of New York, but excepted other 
 
1214 ILLEGAL CONTRACTS (Ch. 9 
 
 states from its operation. The remark relied upon was obiter, and 
 in reason cannot be considered a decision upon the point suggested. 
 We are of the opinion that the contention of the defendant is not 
 sound in principle, and should not be sustained. The boundaries of 
 the states are not those of trade and commerce, and business is re- 
 strained within no such limit. The' country as a whole is that of 
 which we are citiz«is, and our duty and allegiance are due both to the 
 state and nation. Nor is it true as a general rule that a business es- 
 tabhshed here cannot extend beyond the state, or that it may not be 
 successfully established outside of the state. There are trades and 
 employments which from their nature are localized, but this is not 
 true of manufacturing industries in general. We are unwilling to 
 say that the doctrine as to what is a general restraint of trade de- 
 pends upon state lines, and we cannot say that the exception of 
 Nevada and Montana was colorable merely. The rule itself is ar- 
 bitrary, and we are not disposed to put such construction upon this 
 contract as will make it a contract in general restraint of trade, when 
 upon its face it is only partial. The case of Steam Co. v. Winsor, 
 supra, supports the view that a restraint is not necessarily general 
 which embraces an entire state. In this case the defendant entered 
 into the covenant as a cpnsideration in part of the purchase of his 
 property by the Swift & Courtney & Beecher Company, presuma- 
 bly because he considered it for his advantage to make the sale. He 
 realized a large sum in money, and on the completion of the transac- 
 tion became interested as a stockholder in the very business which 
 he had sold. We are of opinion that the covenant, being supported 
 by a good consideration, and constituting a partial and not a general 
 restraint, and being, in view of the circumstances disclosed, reason- 
 able, is valid and not void.* * * * 
 
 * The court held that the bond liquidating the damages for breach at 
 $15,000 did not preclude remedy by injunction in addition. This provision 
 was for the purpose of making performance more certain, and not to give 
 the defendant the power to regain the privilege of doing business by paying 
 $15,000. Compare the contract in Baird. v. Smith, 128 Tenn. 410, 161 S. W. 
 492, L. K. A. 1917A, 376 (1913). "Should the said Smith enter into any 
 business * * * the said Smith agrees to pay $1,000 to the said Baird for 
 this privilege." 
 
 Contracts in restraint of trade were held valid In the following cases : 
 Trenton Potteries Co. v. Oliphant, 58 N. J. Eq. 507, 48 Atl. 728, 46 L. R. A. 255, 
 78 Am. St. Kep. 612 (1899), restraint valid so far as necessary to protect 
 business and good will purchased, even though the buyer hopes to create 
 a monopoly, and even though he has entered into illegal contracts with 
 other producers to suppress competition ; Baird v. Smith, 128 Tenn. 410, 161 
 S. W. 492, L. K. A. 1917A, 376 (1913), sale of store with agreement not to 
 compete in that town; state statute construed to be declaratory of common 
 law ; ' see note as to such statutes, L. R. A. 1917A, 376 ; Williams v. Thomson, 
 143 Minn. 454, 174 N. W. 307 (1919), sale of garage with good will; Palumbo 
 V. Piccioni, 89 N. J. Bq. 40, 103 Atl. 815 (1918), shoe-repairing business with 
 five-year restraint; Boone v. Burnham & Dallas, 179 Ky. 91, 200 S. W. 315 
 (1918), lease of poultry warehouse with 15-mile restraint. 
 
 An excellent classification of contracts in restraint of trade is given by 
 
Sec. 1) RESTRAINT OP TRADE 1215 
 
 HERRESHOFF v. BOUTINEAU. 
 
 (Supreme Court of Rhode Island, 1890. 17 E. I. 3, 19 Atl. 712, 8 L. R A. 
 469. 33 Am. St. Rep. 850.) 
 
 On demurrer to bill. 
 
 Bill for injunction by Julian L. Herreshoff against A. Boutineau. 
 Defendant demurs to the bill. 
 
 Stiness, J. The complainant, director of a school of languages in 
 Providence, employed the respondent to teach French from January 
 7, 1889, to July 1, 1889. The contract in writing provided that the re- 
 spondent would not, during the year after the end of his service, 
 "teach the French or German language, or any part thereof, nor aid 
 to teach them, nor advertise to teach them, nor be in any way connect- 
 ed with any person or persons or institutions that teach them, in the 
 said state of Rhode Island." The respondent's service ended July 1, 
 1889, after which time he gave lessons in French, in Providence. This 
 suit is brought to restrain him from so doing within the time covered 
 by this contract. Th$ respondent demurs to the bill, contending — 
 First, that the contract is void on the groQnd of public policy, because 
 it imposed a general restraint throughout the state ; and, secondly, be- 
 cause it is unreasonable. Is the contract void ? 5 * * * 
 
 We think it cannot be said here, any more than in England, that a 
 restraint is absolutely void, upon grounds of public policy, because it 
 extends throughout a state. Public policy is a variable test. In the 
 days of the early English cases, one who could not work at his trade 
 could hardly work at all. The avenues to occupation were not as open 
 nor as numerous as now, and one rarely got out of the path he started 
 in. Contracting not to follow one's trade was about the same as con- 
 tracting to be idle, or to go abroad for employment. But this is not 
 so now. It is an every-day occurrence to see men busy and prosper- 
 ous in other pursuits than those to which they were trained in youth, 
 as well as to see them change places and occupations without depriv- 
 ing themselves of the means of livelihood, or the state of the benefit 
 of their industry. It would therefore, be absurd, in the light of this 
 common experience nov^;^, to say that a man shuts himself up to idle- 
 ness or to expatriation, and thus injures the public, when he agrees, 
 for a sufficient consideration, not to ft>llow some one calling within the 
 limits of a particular state. There is no expatriation in moving from 
 
 Taft, J., in United States v. Addyston Pipe & Steel Co., 85 Fed. 271, 29 O. C. 
 A. 141, 150, 46 L. R. A. 122 (1898). 
 
 For cases holding a narrower view of liberty of contract, and that general 
 restraint throughout an entire state is invalid, see Lufkin Rule Co. v. Fringeli, 
 57 Ohio St. 596, 49 N. E. 1030, 41 L. R. A. 185, 63 Am. St. Rep. 736 (1898) ; 
 Union Strawboard Co. v. Bonfleld, 193 111. 425, 61 N^. 1038, 86 A^. St. Rep. 
 346 (1901) ; Consumers' Oil Co. v. Nunnemaker, 142 Ind. 560, 41 N. ii. 104«, 
 51 Am. St. Rep. 193 (1895) ; Henschke v. Moore, 257 Pa. 196, 101 Atl. 303, 
 L. R. A. 1917F, 450 (1917). 
 
 "The cottrt's review of, authorities is here omitted. 
 
1216 ILLEGAL CONTRACTS (Ch. 9 
 
 one state to another, and from such removals a state would be likely to 
 gain as many as it would lose. We do not think public policy demands 
 an agreement of the' kind in question to be declared void, and we do 
 not think such a rule is established upon authority. We therefore 
 hold that the agreement set out in the bill is not void simply because it 
 runs throughout the state. . 
 
 Is the contract unreasonable? Courts should be slow to set aside as 
 unreasonable a restriction which has formed a part of the considera- 
 tion of a contract; yet, when it is a restriction upon individual and 
 common rights, which only oppresses one pa,rty without benefiting the 
 other, all courts agree that it should not be enforced. In determining 
 the reasonableness of a contract, regard must be had to the nature and 
 circumstances of the transaction. For example, if one has sold the 
 good-will of a mercantile enterprise, receiving pay for it, upon an 
 agreement not to engage in the same business in the same state, for a 
 certain time, such a stipulation would stand upon quite a different 
 footing from the similar stipulation of a mere servant in an ordinary 
 local business. In many undertakings, with modem methods of ad- 
 vertising and facilities for ordering by telegraph or mail, and sending 
 goods by railroad or express, it would matter little whether otie was 
 located at Providence or Boston or some other place. In such cases a 
 restriction embracing the state, or even a larger territory, could not be 
 said on that account to be unreasonable; for without it the seller 
 might immediately destroy the value of what he sold and was paid for. 
 But it is unreasonable to ask courts to enforce a greater restriction 
 than is needed. So it has been uniformly held that restrictions which 
 go too far are void. As was said in the note of the Law Quarterly Re- 
 view, above cited: "Covenantees desiring the maximum of protec- 
 tion have, no doubt, a difficult task. When they fail, it is commonly 
 because, like the dog in the fable, they grasp at too much, and so lose 
 all." 
 
 Besides the matter of protection, the hardship of the restriction up- 
 on the party and the public should also be considered. In the present 
 case, we think the restriction is unreasonable. Not as a rule of law 
 because it extends throughout the state, but because it extends beyond 
 any apparently necessary protection which the complainant might rea- 
 sonably require, and thus, withou^t benefiting him, it oppresses the re- 
 spondent, and deprives people in other places of the chance which 
 might be offered them to learn the French and German languages of 
 the respondent. The complainant urges that he has established a 
 school in Providence, at great expense, to teach languages by a new 
 method, where scholars come from all parts of the state, and that by 
 reason of the small extent of the state, and the ease of passing to and 
 fro within it, such a. restriction is reasonable and necessary to keep 
 teachers from setting up similar schools, and enticing away his schol- 
 ars. All this may be true with reference to Providence and its vicini- 
 ty. But while, as is averred, many pupils from all parts of the state 
 
Sec. 1) RESTRAINT OF TRADE 1217 
 
 may come to Providence, as a center, for the same reason few would 
 go to other places. For example, a school in Westerly or Newport 
 would not be likely to draw scholars from Providence, or places from 
 which Providence is more easily reached. Indeed, the complainant 
 says he offered, after the contract was made, and now offers, to allow 
 the respondent to teach in Newport; thereby admitting that the re- 
 striction is greater than the necessity. The people of Newport, Wes- 
 terly, and other places have the right to provide for education in lan- 
 guages without coming to Providence. It is hard to believe, and the 
 bill does not aver, that losing the few, if any, from some such place who 
 might leave the complainant, if the respondent were to teach there, 
 would seriously affect the complainant's school. Teaching in Provi- 
 dence, or in any place from which the complainant receives a consid- 
 erable number of pupils, might affect it, and a restriction limited ac- 
 cordingly might be reasonable; but we think it is unreasonable to go 
 further. The complainant bought nothing of the respondent whose 
 value he now seeks to destroy. He hired the latter as a teacher at no 
 more than fair wages. He needs and has the right only to be secured 
 against injury to his school, from teachers who may entice away his 
 scholars, after leaving his employ. The contract clearly goes beyond 
 this. The demurrer must be sustained." 
 
 GAMEWELL EIRE-ALARM TELEGRAPH CO. v. CRANE et al. 
 
 (Supreme Judicial Court of Massacliusetts, 1893. 160 Mass. 50, 35 N. E. 98, 
 22 L. R. A. 673, 39 Am. St. Rep. 458.) 
 
 Bill in equity, filed in the Superior Court on January 14, 1892, 
 against Moses G. Crane and Frederick W. Cole, to enjoin the viola- 
 tion of a contract between the plaintiff and Crane, the material pro- 
 visions of which, together with the facts, appear in the opinion. 
 
 The case was argued at the bar in January, 1893, and afterwards 
 was submitted on the briefs to all the judges. 
 
 Field, C. J. The plaintiff company and the defendant Crane have 
 each appealed from the decree of the superior court. The principal 
 question is whether the following stipulation in the contract betweeq, 
 
 6 If the restraint is unreasonable in extent it is unlawful. Bishop v. 
 Palmer 146 Mass. 469, 16 N. E. 299, 4 Am. St. Rep. 339 (1888) ; Alger v. 
 Thache'r 19 Pick. (Mass.) 51, 31 Am. Dee. 119 (1837) ; Taylor v. Blanchard, 
 13 Allen (Mass.) 370, 90 Am. Dec. 203 (1866). 
 
 Although the restraint is greater than is reasonable, some courts are very 
 liberal in holding that the contract is divisible in case the contract indicates 
 any geographical lines subdividing the restricted territory, and in such case 
 enforce the contract so far as it is reasonable. Trenton Potteries Co. y. 
 Oliphant, supra, "within any state in the United States of America or within 
 the District of Columbia, except in Nevada and Arizona" ; enforced as to 
 New Jersey Mallan v. May, 11 M. & W. 653 (1843), dentist; restraint in 
 London and' in other towns; Price v. Green, 16 M. & W. 346 (1847), per- 
 fumery; Iiondon and within 600 miles. 
 
 COEBIN CONT — 77 
 
1218 ILLEGAL CONTRACTS (Ch. 9 
 
 the plaintiff and Crane is void. The stipulation is : "Said Crane fur- 
 ther agrees not to engage in the business of manufacturing or selling 
 fire alarm or police telegraph machines and apparatus, and not to 
 enter into competition with said Gamewell Company, either directly 
 or indirectly, for the period of ten years next ensuing after the date of 
 this agreement." Crane had been a manufacturer of fire alarm and 
 police telegraph apparatus from the year 1856 to 1886, when the con- 
 tract was entered into which is the subject of this suit. From the year 
 1879 to January, 1891, he was a director of the plaintiff company. In 
 1881, he, or the firm of which he was a member, entered into a con- 
 tract with the plaintiff company to do all of its manufacturing. He 
 testified that the company "was to have the use of patents of mine for 
 a term of ten years, and to give all its manufacturing to Moses G. 
 Crane or Crane & Co., and they agreed not to compete with the Game- 
 well Company during that time." This is the contract which was an- 
 nulled by the contract in suit. By the contract in suit Crane sold and 
 conveyed to the company all his machinery, tools, draw cases, and other 
 property used in or connected with his business of manufacturing for 
 said company, including "stock supplies partly manufactured, and raw 
 material of every kind in any way pertaining" to said business of man- 
 ufacturing in his factory at Newton Highlands, in Massachusetts, and 
 he agreed to transfer to said company exclusive rights under and con- 
 trol of all letters patent for fire alarm and police apparatus only, 
 owned or controlled wholly or in part by him, together with exclusive , 
 rights under and control of all improvements in said fire alarm and 
 police apparatus only, made by him up to the date of the contract, and 
 he gave to said company the "first option to purchase or obtain exclu- 
 sive control for fire alarm and police purposes only, under any and 
 all letters patent, improvements applicable to such apparatus which 
 may be made by said Crane during the term of ten years next en- 
 suing after the date of this agreement," etc. The consideration to be 
 paid was $30,000 in cash and notes, and in addition to this such un- 
 wrought stock, machinery, etc., as Was on hand at the date of the 
 transfer, and was not incliided in the schedule attached to the contract, 
 was also to be paid for at the "cost price, to be fixed by appraisal." 
 Crane also agreed to let his factory to the company at a reasonable 
 rent if the company desired to hire it. The company' actually paid 
 Crane about $47,000 as the consideration of the contract and the prop- 
 erty conveyed. 
 
 The plaintiff contends that the agreenient "not to engage in the 
 business of manufacturing or selling fire alarm or police telegraph 
 machines and apparatus, and not to enter into competition with said 
 Gamewell Company, either directly or indirectly, for the period of ten 
 years," etc., is not void as being in restraint of trade — First, because it 
 is an agreement pertaining to "property and business protected by pat- 
 ents ;" secondly, because the restraint, is only coextensive with the 
 business sold, and is ^jecessary to enable the company to enjoy fully 
 
Sec. 1) EESTKAINT OF TRADE 1219 
 
 what it has bought and paid for; and, thirdly, because it relates to a 
 single commodity, not of prime necessity, and not a staple of com- 
 merce. See Roller Co. v. Cushman, 143 Mass. 353, 9 N. E. 629; Ma- 
 chine Co. V. Morse, 103 Mass. 73, 4 Am. Rep. 513; Gloucester Isin- 
 glass & Glue Co. V. Russia Cement Co., 154 Mass. 92, 27 N. E. 1005, 
 12 L. R. A. 563, 26 Am. St. Rep. 214. 
 
 There seems to be no reason why the defendant Crane should not 
 assign the patents and inventions which he agreed to assign, if there 
 are any, and no serious objection has been raised by the defendant on 
 this part of the case. The defendant contends that he has a right 
 to assist in forming a corporation, and to act as one of its officers, the 
 business of which is to manufacture and sell fire alarm and police tele- 
 graph machines which are not made under any patents owned by the 
 plaintiff, or under any patents which he has agreed to assign to the 
 plaintiff, or which the plaintiff has elected to purchase, under the 
 option givein in the contract, even although by so doing he enters into 
 competition with the plaintiff in its business. He, in effect, concedes 
 that, so far as the business is protected by patents which he has as- 
 signed or agreed to assign, the restraint is valid. It appears that there 
 a're "a dozen or fifteen concerns in the United States engaged in a 
 somewhat similar business." The defendant testified that he looked 
 up the number of patents pertaining to this branch of the art in 1881, 
 and that there were then about 500. The defendant contends that he 
 ought to be able to use his own patents . for subsequent improvements 
 applicable to such apparatus if the plaintiff does not elect to purchase 
 them ; that he was previously a manufacturer of fire alarm and police 
 telegraph apparatus, and not a seller thereof ; that the good will which 
 attached to his business was that of a manufacturer who did not 
 sell his manufactures in the market; and that it is against public policy 
 that he should be restrained from exercising his peculiar skill anywhere 
 in the United States or in the world for the period of 10 years. The 
 apparatus, as the defendant contends, which he has a right to manu- 
 facture and sell is not secret machinery, and is not protected by any 
 patents which the plaintiff owns or has a right to control, but is appa- 
 ratus either not protected by patents at all, or by patents of his own, 
 or of other persons who may choose to employ the defendant. 
 
 The only ground, then, on which this restriction can be maintained 
 is that it is reasonably necessary for the beneficial enjoyment by the 
 plaintiff of the property it bought of the defendant, or, if this is not 
 so, that the law in modern times does not regard such an agreement 
 as' against public policy. So far as we are aware, in every modern 
 case in this commonwealth, except one where a contract in restraint 
 of trade has been held valid, the restriction has been limited as to space. 
 In Taylor v. Blanchard, 13 Allen, 370, 90 Am. Dec. 203, the parties 
 entered into a partnership for carrying on "the trade or business of 
 manufacturing shoe cutters," and it was provided that "at whatever 
 time the said copartnership shall be determined and ended" the de- 
 
1220 ILLEGAL CONTEACTS (Ch. 9 
 
 fendant "shall not, nor will at any time or times hereafter, either alone 
 or jointly with or as agent for any person or persons whomsoever, set 
 up, exercise, or carry on the said trade or business of manufacturing 
 and selling shoe cutters at any place within the aforesaid common- 
 wealth of Massachusetts, and shall not, nor will set up, make, or en- 
 courage any opposition to the said trade or business hereafter to be 
 carried on" by the plaintiff. The manufacture of shoe cutters was an 
 art, which could be carried on only by persons instructed in it, and the 
 business was confined to the plaintiff and three other persons ; but the 
 court held the agreement void. 
 
 In Bishop v. Palmer, 146 Mass. 469, 16 N. E. 299, 4 Am. St. Rep. 
 339, the plaintiff, being engaged in the manufacturing and sale of bed- 
 quilts and comfortables, conveyed to the defendant his "entire busi- 
 ness plant and enterprise as a manufacturer of and dealer in bedquilts 
 and comfortables," together with the good will of the business, and 
 all the machinery, implements, and utensils used by him in said busi- 
 ness, and agreed "that for and during the period of five years from 
 the date hereof he will not, either directly or indirectly, in his own name 
 or in the name of any other person or persons, continue in, carry on, 
 or engage in the business of manufacturing or dealing in bedquilts or 
 comfortables, or of any business of which that may form any part." 
 It was held that this was clearly illegal and void as being in restraint 
 of trade, because not limited as to space. See also, Peirce v. Fuller, 8 
 Mass. 223, 226, 5 Am. Dec. 102; Perkins v. Lyman, 9 Mass. 522; 
 Stearns v. Barrett, 1 Pick. 443, 11 Am. Dec. 223; Palmer v. Steb- 
 bins, 3 Pick. 188, 15 Am. Dec. 204; Alger v. Thacher, 19 Pick. 51, 31 
 Am. Dec. 119; Oilman v. Dwight, 13 Gray, 356, 74 Am. Dec. 634; 
 Angier v. Webber, 14 Allen, 211, 92 Am. Dec. 748; Dean v. Emerson, 
 102 Mass. 480; Dwight v. Hamilton, 113 Mass. 175 ; Boutelle v. Smith, 
 116 Mass. Ill; Ropes v. Upton, 125 Mass. 258; Handforth v. Jack- 
 son, 150 Mass. 149, 22 N. E. 634. 
 
 The case of Machine Co. v. Morse, ubi supra, is the case referred 
 to as an exception. The question arose upon demurrer. The agree- 
 ment of the defendant was not only to transfer his patents, machinery, 
 etc., and all improvements and inventions, but "that he will use his 
 best efforts for the perfecting of improvements in the business and 
 manufacture, and for such alterations and combinations as may tend 
 to insure the success of the same and of the company," and that he will 
 "do no act that may injure the company or its business, and that he 
 will at no time aid, assist, or encourage in any manner any compe- 
 tition against the same." He also agreed "to serve as the superintendent 
 of the company for three years," etc. The plaintiff company was 
 formed by the defendant and others, and the defendant's business 
 was transferred to it. He was a stockholder, and was made super- 
 intendent. The plaintiff agreed to employ the defendant for three 
 years, and he was actually employed as superintendent up to the 
 time he entered upon a competing business. The case seems to have 
 
Sec. 1) RESTRAINT OP TKADH 1221 
 
 been decided on the ground that the defendant had agreed to give 
 to the plaintiff his exclusive services with reference to his mechan- 
 ical skill and ingenuity in all improvements, alterations, and combi- 
 nations which would tend to insure the success of the plaintiff in man- 
 ufacturing twist drills and collets. The court say that "the same prin- 
 ciple that enables a partner to bind himself to do nothing in competi- 
 tion with the business of the firm ought to apply to him." The opinion 
 proceeds to consider the English cases where the restriction was held 
 not to extend beyond the good will of the business which was the sub- 
 ject of the sale, or was not greater than the interests of the vendee 
 required, and was not unreasonable in view of all the circumstances. 
 
 This doctrine, in England, has been carried very far. See Badische 
 Anilin und Soda Fabrik v. Schott, [1892] 3 Ch. 447; Mills v. Dun- 
 ham, [1891] 1 Ch. 576; Davies v. Davies, 36 Ch. Div. 359. In this 
 country the courts generally have not gone so far, but the old law has 
 been a good deal modified in some jurisdictions in view of modern 
 methods of doing business. See 22 E. Ed. 315; Navigation Co. v. 
 Winsor, 20 Wall. 64; Fowle v. Park, 131 U. S. 88, 9 Sup. Ct. 658, 
 33 L. Ed. 67; Ellerman v. Stockyards Co., 49 N. J. Eq. 217, 23 
 Atl. 287; Association v. Starkey, 84 Mich. 76, 47 N. W. 604, 11 
 L. R. A. 503, 22 Am. St. Rep. 686; Matthews v. Associated Press, 
 136 N. Y. 333, 32 N. E. 981, 32 Am. St. Rep. 741 ; Oliver v. Gil- 
 more (C. C.) 52 Fed. 562; Match Co. v. Roeber, 106 N. Y. 473, 13 
 N. E. 419, 60 Am. Rep. 464; Whitney v. Slayton, 40 Me. 224. 
 
 In the present case the plaintiff did not buy the good will of a riier- 
 cantile business, and the defendant Crane had no customers for fire 
 alarm and police telegraph machines and apparatus. The plaintiff 
 gets everything it bought if it gets the tangible property and the letters 
 patent and the improvements which the defendant Crane agreed to 
 convey. The stipulation that Crane will not for 10 years manufac- 
 ture or sell fire alarm or police telegraph machines and apparatus, al- 
 though under patents in which the plaintiff has no interest, or under 
 patents which it has refused to buy, or under no patent at all, will tend 
 to give the plaintiff a monopoly of the business. To exclude a person 
 from manufacturing or selling anywhere in the United States or in the 
 world machinery designed for certain purposes, in which that person 
 has acquired great skill, may operate to inipair his means of earning a 
 living. 
 
 The stipulation seems to us to be something more than is reasonably 
 necessary to protect the plaintiff in the enjoyment of the property it 
 bought, even if that should be adopted as the test, upon which we ex- 
 press no opinion. The principal object of the stipulation was, we think, 
 to prevent the manufacture or sale by the defendant of any instru- 
 ments which would serve the same purpose as those made and sold 
 by the plaintiff, and thus to enable the plaintiff more completely to con- 
 trol the iriarket. Large cities and towns cannot well do without some 
 
1222 ILLEGAL CONTRACTS (Ch. 9 
 
 kind of fire alarm and police telegraph apparatus, and it is an article of 
 necessity for such municipalities. We are of opinion that under our 
 decisions the stipulation must be pronounced void as against public 
 policy. If there is to be a change in the lawj as heretofore many times 
 declared by this court, we think it is for the legislature to make it. See 
 Factor Co. v. Adler, 90 Cal. 110, 27 Pac. 36, 25. Am. St. Rep. 102; 
 Taylor v. Saurman, 110 Pa. 3, 1 Atl. 40; Richardson v. Buhl, 77 Mich. 
 632, 43 N. W. 1102, 6 L. R. A. 457; Herreshoff v. Boutineau, 17 R. I. 
 3, 19 Atl. 712, 8 L. R. A. 469, 33 Am. St. Rep. 850; Strait v. Harrow 
 Co., (Sup.) 18 N. Y. Supp. 224; Anderson v. Jett, 89 Ky. 375, 12 S. 
 W. 670, 6 L. R. A.I 390; Urmston v. Whitdegg, 63 Law T. R. (N. S.) 
 455; Perls V. Saalfeld, [1892] 2 Ch. 149. : .: 
 
 For these reasons a majority of the court are of opinion that the 
 decree against Gtane should be substantially affirmed as to the assign- 
 ment of patents and inventions and as to costs, and should be re- 
 versed as to the rest. The decree in favor of Cole should be affirmed. 
 So ordered.^ 
 
 NORDENFELT v. MAXIM NORDENFEIvT GUNS & AMMU- 
 NITION CO., LIMITED. 
 
 (In the House of Lords, 1894. [1894] App. Cas. 535.) 
 
 Lord Herschell, L. C.^ My Lords, the question raised by this 
 appeal is, whether a covenant entered into between the parties can be 
 enforced against the appellant, or whether it is void as being in re- 
 straint of trade. 
 
 The covenant in question was contained in an agreement of the 
 12th of September, 1888,- and was in these terms: "(2) The said 
 Thorsten Nordenfelt shall not, during the term of 25 years from the 
 
 ^ Where the restraint covers a territory greater in extent that that in 
 which the seller had already developed business and good will, it is illegal ; 
 it is not made reasonable by the fact that the buyer afterwards extends his 
 business into the larger territory or by the fact that ie himself was already 
 doing business in such larger territory. Trenton Potteries Co. v. Oliphant, 
 58 N. J. Eq. 507, 43 Atl. 728, 46 U K. A. 255, 78 Am. St. Rep. 612 (1899). 
 
 The restraint may be unreasonable because it covers lines of trade other 
 than those sold by the party who is restrained ; the restraint being only to 
 prevent competition, and not 'to protect the buyer in the enjoyment of good 
 vrill purchased. See Anchor Electric Co. v. Hawkes, 171 Mass. 101, 50 N. E. 
 509, 41 L. .R. A. 189, 68 Am. St. Rep. 403 (1898). 
 
 Cf. Central Shade-Roller Co. v. Cushman, 143 Mass. 353, 9 N. E. 629 (1887), 
 holding that a combination of competing manufacturers and sellers of patent- 
 ed curtain fixtures was not unlawful, partly because each article was a 
 patented article and partly because "the agreement does not refer to an article 
 of prime necessity, nor to a staple of commerce, nor to metchandise to be 
 bought and sold in the market, but to a particular curtain fixture of the 
 parties' own manufacture." This was disapproved by Taft, J., In U S v 
 Addyston Pipe & Steel Co., 85 Fed. 271, 29 C. 0. A. 141, 46 L. R. A. 122 (1898). 
 
 8 The statement of facts and the concurring opinions of Lords Watson, Ash- 
 bourne, Macnaghten, and Morris are omitted. 
 
Sec. i) EESTRAIXT OF TRADE 1223 
 
 daj:e of the. incprporation of the company if the company shall so 
 long contmue to carry on business, engage, except on behalf of the 
 company either directly or indirectly in the trade or business of a 
 manufacturer of guns, gun-mountings or carriages, gunpowder ex- 
 plosives or ammunition or in any business competing or liable to com- 
 pete in any way with that for the time being carried on by the company ; 
 provided that sucli restriction shall not apply to explosives other than 
 gunpowder or to subaqueous or submarine boats or torpedoes or 
 castings or forgings of steel or iron or alloys of iron or of copper. 
 Provided also that the said Thorsten Nordenfelt shall not be released 
 from this restriction by the company ceasing to carry on business 
 merely for the purpose of reconstitution or with a view to the transfer 
 of the business thereof to another company so long as such other 
 company taking a transfer thereof shall continue to carry on the 
 same." The agreement also provided that the appellant should, for 
 seven years from the incorporation of the respondent company, retain 
 the share qualification of a director, and should act as managing 
 director of the company, at a remuneration of £2,000 a year, together 
 with a cammission upon the net, profit of the cornpany. 
 
 Before directing attention to the particular terms of the covenant, 
 and to the considerations to which it gives rise, it is necessary to 
 advert to the position of the parties at the time the agreement was 
 entered into. 
 
 The appellant had, prior to March, 1886, obtained patents for im- 
 provements in quick-firing guns, and carried on, amongst other things, 
 the business of the manufacture of such guns and of ammunition. 
 In that month he procured the registration of a limited liability com- 
 pany, which was to take over his business, with the business assets 
 and liabilities. On the Sth of March, 1886, an agreement was made 
 between the appellant and the Nordenfelt Guns & Ammunition Com- 
 pany by which the company was to purchase the goodwill of the appel- 
 lant's business, and all the stock, plant, and patents connected there- 
 with, he covenanting to act as managing director for a period of five 
 years, and so long as the Nordenfelt Company should continue to carry 
 on business "not to engage, except on behalf of such company, either 
 directly or indirectly in the trade or business of a manufacturer of 
 guns or ammunition, or in any business competing or liable to com- 
 pete in any way with that carried on by such company." 
 
 The agreement for purchase was duly carried into effect, and the 
 price paid to the appellant, namely, i237,000 in cash, and £50,000 in 
 paid-up shares of the company. In July, 1888, negotiations were en- 
 tered into for the amalgamation of the Nordenfelt Company and the 
 "Maxim Gun Company, and for the transfer of their business and 
 assets to a new company, to be called the Maxim-Nordenfelt Guns & 
 Ammunition Company. 
 
 By an agreement for the amalgamation of the two companies, dated 
 the 3rd of July, 1888, and made between the Maxim Company, the 
 
1224 ILLEGAL CONTRACTS (Ch. 9 
 
 Nordenf elt Company, and P. Thaine, on behalf of the new com- 
 pany, the Nordenfelt Company agreed that they would procure the 
 appellant to enter into the agreement which was afterwards embodied 
 in the instrument of the 12th of September, 1888. 
 
 The respondents were incorporated on the 17th of July, 1888, and on 
 the 8th of August the agreement of the 3d of July was adopted by 
 the company. It is to be noted that at the time when this agreement 
 was entered into, to which the Nordenfelt Company was a party, 
 the appellant was managing 'director of that company, and that, in 
 the memorandum of association of the amalgamated company which 
 was signed by the appellant, the objects of the company were stated 
 to be, inter alia, not only the adoption of the agreement of the 3d 
 of July, but also "to acquire, undertake, and carry on as successors 
 to the Maxim Gun Company and the Nordenfelt Gims & Ammunition 
 Company, the good will of the trade and businesses heretofore carried 
 on by such companies and each of them, and the property and rights 
 belonging to or held in connection therewith respectively." 
 
 This is of importance, because the appellant in a forcible argument 
 pointed out that the judgment of the Court of Appeal was largely 
 founded on the fact that the covenant in question was entered into 
 in connection with the sale of the good will of the appellant's business, 
 and was designed for the pi'otection of the good will so sold, and he 
 contended that this was an error, inasmuch as there was no sale by 
 him of the good will on that occasion, he having already parted with 
 it to the Nordenfelt Company, the later sale being by that company 
 and not by him. 
 
 I think it is impossible to accede to this contention. Upon the sale 
 by the appellant to the Nordenfelt Company, the good will was con- 
 veyed to them, and was protected by a covenant in some respects 
 larger than the one he entered into in September, 1888, but it was 
 limited to the time during which that company should carry on busi- 
 ness; it therefore necessarily ceased when the Nordenfelt Company 
 and the Maxim Company were absorbed by the new company. But 
 in the agreement for the amalgamation (to the making of which, as 
 I have said, the appellant was a party) the covenant which the Nor- 
 denfelt Company undertook to obtain from the appellant was to be 
 in addition to the transfer by the Nordenfelt Company of the full 
 benefit of any obligations which Mr. Nordenfelt was then under to that 
 company, and by the terms of the memorandum of association of the 
 new company the object was, as I have shewn, stated to the world to be 
 the acquisition of the good will of the Nordenfelt Company. 
 
 My Lords, in view of these facts, I think the case must be treated 
 on precisely the same footing as if the obligations of the covenant' 
 under consideration had been undertaken in connection with the direct 
 transfer to the respondents of the good will of the appellant's busi- 
 ness and with the object of protecting it. 
 
 The appellant mainly relied upon the fact that the covenant was gen- 
 
Sec. 1) RESTRAINT OF TRADE 1225 
 
 eral, that is to say, unlimited in respect of area, and argued that it 
 was therefore void. I think it was long regarded as established, as 
 part of the common law of England, that such a general covenant 
 could not be supported. 
 
 In early times all agreements in restraint of trade, whether general 
 or restricted to a particular area, would probably have been held bad ; 
 but a distinction came to be taken between covenants in general re- 
 straint of trade and those where the restraint was only partial. The 
 distinction was recognized and given effect to by Lord Macclesfield in 
 his celebrated judgment in Mitchel v. Reynolds, 1 P. Wms. 181. That 
 was a case of particular restraint, and the covenant was held good, 
 the Chief Justice saying, "that wherever a sufficient consideration ap- 
 pears to make it a proper and a useful contract, and such as cannot be 
 set aside without injury to a fair contractor, it ought to be maintained ; 
 but with this constant diversity, namely, where the restraint is general, 
 not to exercise a trade throughout the kingdom, and where it is limited 
 to a particular place, for the former of these must be void, being of 
 no benefit to either party, and only oppressive as shall be shewn by-and- 
 by." And at a later part of the judgment, after dividing voluntary re- 
 straints by agreement into those which are, first, general, or secondly, 
 particular as to places or persons, he formulates with regard to the for- 
 mer the following proposition : "General restraints are all void, wheth- 
 er by bond, covenant, or promise, &c., with or without consideration, 
 and whether it be of the party's own trade or not." In the case of 
 Master, &c., of Gunmakers v. Fell, Willes, at p. 388, Willes, C. J., said 
 the general rule was "that all restraints- of trade, (which the law so 
 much favours,) if nothing more appear, are bad. * * * But to 
 this general rule there are some exceptions, as, first, if the restraint be 
 only particular in respect to the time or place, and there be a good con- 
 sideration given to the person restrained." 
 
 As I read the authorities, until the cases to which I shall call atten- 
 tion presently, the distinction between general and particular restraints 
 was always maintained, and the latter alone were regarded as excep- 
 tions from the general rule, that agreements in restraint of trade were 
 bad. 
 
 In the case of Horner v. Graves, 7 Bing. 735, Tindal, C. J., said : 
 "The law upon this subject (i. e., restraint of trade) has been laid 
 down with so much authority and precision by Parker, C. J., in giving 
 the judgment of the Court of B. R. in the case of Mitchel v. Reynolds, 
 1 P Wms. 181, whicji has been the leading case on the subject from 
 that time to the present, that little more remains than to apply the 
 principle of that case to the present. Now, the rule laid down by the 
 Court in that case is, 'that voluntary restraints, by agreements between 
 the parties, if they amount to a general restraint of trading by either 
 party, are void, whether with or without consideration ; but particular 
 restraints of trading, if made upon a good and adequate consideration. 
 
1226 ILLEGAL CONTRACTS (Ch. 9 
 
 SO as it be a proper and useful contract,' that is, so as it is a reasonable 
 restraint only, 'are good.' " 
 
 After stating that the case then before the Court did not "fall with- 
 in the first class of contracts as it certainly did not amount to a gen- 
 eral restraint," he proceeded to consider whether the particular cove- 
 nant was a good one. 
 
 It is true that in a later part of his judgment the following passage 
 occurs : "In the case above referred to, Parker, C. J., says, 'a restraint 
 to carry on a trade throughout the kingdom must be void ; a restraint 
 to carry it on within a particular place is good' ; which are rather 
 instances and examples, than limits of the application of the rule, 
 which can only be at last, what is a reasonable restraint with reference 
 to the particular case." But I cannot, in view of the passage which I 
 have quoted from the earlier part of his judgment, understand this as 
 an indication of opinion on the part of Tindal, C. J., that there was no 
 distinction in point of law between general and particular restraints; 
 that in the case of both alike the only question is whether in the par- 
 ticular case the restraint is reasonable. If so, it could hardly be said 
 that the law had been laid down with precision by Parker, C. J., nor 
 could such contracts be accurately divided into two classes, if every 
 particular case, whether it fell within the one class or the other, was, in 
 point! of law, to be dealt with in precisely the same manner. I am 
 confirmed in this view of Tindal, C. J.'s opinion by his judgment in the 
 subsequent case of Hinde v. Gray, 1 Man. & G. 195. In that case the 
 defendant had entered into a covenant with the plaintiffs, to whom he 
 had demised a brewery in Sheffield, that he would not, during the con- 
 tinuance of the demise, carry on the trade of brewer or agent for the 
 sale of beer in Sheffield or elsewhere, but would, so far as the same 
 should not interfere with his private avocations, give all the advice and 
 information in his power to the plaintiffs with regard to the manage- 
 ment and carrying on of the brewery. The breach alleged was that the 
 defendant had solicited and obtained orders for ale not purchased of the 
 plaintiffs nor brewed by them, and that large quantities ot ale had 
 thereunder been delivered and sold. There was a demurrer to this 
 breach; judgment was given for the defendant, Tindal, C. J., sa)dng 
 that it was "assigned on a covenant which according to the case of 
 Ward V. Byrne, 5 M. & W. 548, was void in law." This is, to my mind, 
 only inteUigible if Ward v. Byrne, -5 M. & W. 548, which was the case 
 of a bond conditioned not to follow or be employed in the business of 
 a coal merchant for nine months, was regarded as establishing, as a 
 matter of law, that a covenant in general restraint, though limited in 
 point of time, was void ; unless it were so, I do not see how it could be 
 regarded as determining that the covenant in question in Hinde v. 
 Gray, 1 Man. & G. 195, was void; or, indeed, as an authority in the case 
 of any covenant not practically identical in all respects. It is clear 
 that there are material distinctions between the circumstances (\i the 
 
Sec. 1) RESTRAINT OF TRADE 1227 
 
 two cases; and, if the only question was whether the covenant was 
 reasonable in view of the particular circumstances, considerations 
 might well be urged (as indeed they were by the learned counsel for the 
 plaintiffs) why the case then before the Court should not be regarded 
 as governed by Ward v. Byrne, 5 M. & W. 548; but Tindal, C. J., did 
 not proceed to inquire whether, under the particular circumstances ap- 
 pearing on the record in Hinde v. Gray, 1 Man. & G. 195, the covenant 
 was a reasonable one, or was wider than was requisite for the protec- 
 tion of the plaintiffs, but treated the case as concluded, as, matter of 
 law, Ey authority. 
 
 I need not further refer to Ward v. Byrne, 5 M. & W. 548, except to 
 say, that although the learned judges in that case did express an opin^ 
 ion that the covenant exceeded what was necessary for the protection 
 of the covenantee, they seem to me to recognize that covenants for a 
 partial restraint, and these only, are exceptions from a general rule in- 
 validating agreements in restraint of trade. In that case, the attempt 
 was made, unsuccessfully, to maintain that a covenant otherwise gen- 
 eral might be regarded as a particular restraint, if limited in point of 
 time : a contention for which some color was afforded by the lan- 
 guage used in earlier cases. 
 
 The views which I have expressed appear to me to have been en- 
 tertained by that very learned ^lawyer Mr. John William Smith, as 
 shewn by his notes to Mitchel v. Reynolds, 1 P. Wms. 181. He lays 
 down the law thus : "In order, therefore, that a contract in restraint 
 of trade may be valid at law, the restraint must be, first, partial, sec- 
 ondly, upon an adequate, or, as the rule now seems to be, not on a mere 
 colourable consideration, and there is a third requisite, namely, that it 
 should be reasonable." "This exposition of the law has, further, the 
 very weighty sanction of Willes and Keating, JJ., who, after the death 
 of Mr. J. W. Smith, edited the notes to his collection of leading cases. 
 
 In the year after the decision of Hinde v. Gray, 1 Man. & G. 195, 
 the case of Whittaker v. Howe, 3 Beav. 383, 394, came before Lord 
 X<angdale. Howe had covenanted not to practise as a solicitor in any 
 part of Great Britain for twenty years, having sold his busitiess to the 
 plaintiff. In spite of this he commenced again practising in London, 
 where he had previously carried on business. On an application for an 
 interlocutory injunction, it was contended that the covenant was void. 
 The Master of the Rolls refused to accede to this contention and grant- 
 ed the injunction. It was, of course, clear that a covenant not to 
 practise in London, as he was in fact doing, would have been good, 
 and it was natural that his conduct should not find favour at the hands 
 of the Court. But the question was whether so extensive a covenant 
 as that entered into could be supported. The case of Mitchel v. Rey- 
 nolds, 1 P. Wms.. 181, was cited in argument, but neither Ward v. 
 Byrne, 5 M. & W. 548, nor Hinde v. Gray, 1 Man. & G. 195, appear to 
 have been brought to the notice of the Court. Lord Langdale expressed 
 
1228 ILLEGAL CONTRACTS (Ch. 9 
 
 himself thus (Whittaker v. Howe, 3 Beav. 383, 394) : "Agreeing with 
 the Court of Common Pleas, that in such cases 'no certain precise boun- 
 dary can be laid down within which the restraint would be reasonable 
 and beyond which excessive,' having regard to, the nature of the pro- 
 fession, to the limitation of time, and to the decision that a distance of 
 150 miles does not describe an unreasonable boundary, I must say, as 
 L^rd Kenyon said in Davis v. Mason, 5 T. R. 118, 'I do not see that 
 the limits are necessarily unreasonable, nor do I know how to draw 
 the line.' " 
 
 The learned judge distinctly indicated that he had not arrived at 
 an irrevocable conclusion, for he added: "In the progress of the case 
 it may become necessary to consider further the points which have 
 been raised ; but at present I am of opinion that the right claimed by 
 Mr. Howe to act in violation of the contract for which he has received 
 consideration, is, to say the least, sO' far doubtful, that he ought not 
 to be permitted to take the law into his own hands." It is not neces- 
 sary to consider whether the decision can be supported, though it was 
 regarded by Willes and Keating, JJ., as questionable, and it is cer- 
 tainly difficult to see why, if a covenant not to practise as an attorney 
 in Great Britain is good, a covenant such as was in controversy in 
 Hinde v. Gray, 1 Man. & G. 195, should have been pronounced bad 
 in point of law on demurrer. But I cannot accept it as a weighty 
 authority on the question whether it was regarded as a rule of the 
 common law that a general covenant in restraint of trade was void, 
 in view of the authorities I have already referred to. 
 
 There have been differing expressions of opinion on the subject by 
 distinguished equity judges in more recent times. I will only allude 
 to two of these, in which the existence of the rule I have been con- 
 sidering has been questioned. In the case of the Leather Cloth Com- 
 pany V. Lorsant, Law Rep. 9 Eq. 345, James, V. C, said : "I do not 
 read the cases as having laid down that unrebuttable presumption 
 which was insisted upon with so much power by Mr. Cohen. All the 
 cases, when they come to be examined, seeiii to establish this prin- 
 ciple, that all restraints upon trade are bad as being in violation of 
 public policy, unless they are natural, and not unreasonable for the 
 protection of the parties in dealing legally with some subject-matter 
 of contract.'' 
 
 And again, in Rousillon v. Rousillon, 14 Ch. D. 351, Fry, J., thus 
 expressed himself : "I have therefore, upon the authorities, to choose 
 between two sets of cases, those which recognize and those which 
 refuse to recognise this supposed rule ; and, for the reasons which I 
 have mentioned, I have no hesitation in saying that I adhere to those 
 authorities which refuse to recognise this rule, and I consider that 
 the cases in which an unlimited prohibition has been spoken of as 
 void relate only to circumstances in which such a prohibition has been 
 unreasonable." 
 
Sec. 1) EESTRAINT OF TRADE 1229 
 
 I do not intend to throw doubt on what was decided in these cases, 
 for reasons which will appear hereafter, but I respectfully differ from 
 the view which appears to be indicated that there was not at any time 
 a rule of the common law distinguishing- particular from general re- 
 straints, and treating the former only as exceptions from the general 
 principle that contracts in restraint of trade are invalid. 
 
 The discussion on which I have been engaged is, it must be ad- 
 mitted, somewhat academic. For, in considering the application of 
 the rule, and the limitations, if any, to be placed on it, I think that 
 regard must be had to the changed conditions of commerce and of 
 the means of communication which have been developed in recent 
 years. To disregard tnese would be to miss the substance of the rule 
 in a blind adherence to its letter. Newcastle-tipon-Tyne is for all 
 practical purposes as near to London today as towns which are now 
 regarded as suburbs of the metropolis were a century ago. An order 
 can be sent to Newcastle more quickly that it could then have been 
 transmitted from one end of London to the other, and goods can be 
 conveyed between the two cities in a few hours and at a comparatively 
 small cost. Competition has assumed altogether different proportions 
 in these altered circumstances, and that which would have been once 
 merely a burden on the covenantor may now be essential if there is 
 to be reasonable protection to the covenantee. 
 
 When Lord Macclestield emphasized the distinction between a gen- 
 eral restraint not to exercise a trade throughout the kingdom and 
 one which was limited to a particular place, the reason which he 
 gave for the distinction was that "the former of these must be void, 
 being of no benefit to either party, and only oppressive, as shall be 
 shewn by-and-by." He returns to the suDject later on, when giving 
 the reasons why all voluntary restraints are regarded with disfavor 
 by the law, in these terms: "Thirdly, because in a great many in- 
 stances they can be of no use to the obligee ; which holds in all cases 
 of general restraint throughout England ; for what does it signify to 
 a tradesman in London what another does at Newcastle ? And surely 
 it would he unreasonable to fix a certain loss on one side, without any 
 benefit to the other. The Roman Law would not enforce such con- 
 tracts by an action. (See Pufifendorf, lib. 5, c. 2, s. 3, 21 H. 7, 20)." 
 There are other 'passages in the judgment where this view is enforced. 
 
 There is no doubt that, with regard to some professions and com- 
 mercial occupations,, it is true today as it was formerly, that it is hard- 
 ly conceivable that it should be necessary, in order to secure reason- 
 able protection to a covenantee, that the covenantor should preclude 
 'himself from carrying on such profession or occupation anywhere in 
 England. But it cannot be doubted that in other cases the altered 
 circumstances to which 1 have alluded have rendered it essential, if 
 the requisite protection is to be obtained, that the same territorial 
 limitations should not be insisted upon which would in former days 
 have been only reasonable. I think, then, that the same reasons 
 
1230 ILLEGAL CONTRACTS (Ch. 9 
 
 which led to the adoption of the rule require that it should be frankly 
 recognized that it cannot be rigidly adhered to in all cases. 
 
 My Lords, it appears to me that a study of Lord Macclesfield's 
 judgment will shew that if the conditions which prevail at the present 
 day had existed in his time he would not have laid down a hard-and- 
 fast distinction between general and particular restraints, for the 
 reasons by which he justified that distinction would have been un- 
 founded in point of fact. 
 
 Whether the cases in which a general covenant can now be sup- 
 ported are to be regarded as exceptions from the rule which I think 
 was long recognized as established, or whether the rule is itself to be 
 treated as inapplicable to the altered conditions which now prevail, is 
 probably a matter of words rather than of substance. The latter is 
 perhaps the sounder view. When once it is admitted that whether the 
 covenant be general or particular, the question of its validity is alike 
 determined by the consideration whether it exceeds what is necessary 
 for the protection of the covenantee, the distinction between general 
 and particular restraints ceases to be a distinction in point of law. 
 
 I think that a covenant entered into in connection with the sale 
 of the good will of a business must be valid where the full benefitof 
 the purcnase cannot be otherwise secured to the purchaser. It has 
 been recognized in more than one case that it is to the advantage of 
 the public that there should be free scope for the sale of the good will 
 of a business or calling. These were cases of partial restraint. , But 
 it seems to me that if there be occupations where a sale of the good 
 will would be greatly impeded, if not prevented, unless a general cove- 
 nant could be obtained by the purchaser, there are no grounds of 
 public policy which countervail the disadvantage which would arise 
 if the good will were in such cases rendered unsaleable. 
 
 I would adopt in these cases the test which in a case of partial re- 
 straint was applied by the Court of Common Pleas in Horner v. 
 Graves, 7 Bing. 735, 743, in considering whether the agreement was 
 reasonable. Tlndal, C. J., said: "We do not see how a better test 
 can be applied to the question, whether reasonable or not, than by 
 considering whether the restraint is such only as to afford a fair pro- 
 tection to the interests of the party in favour of whom it is given, and 
 not so large as to interfere with the interests of the public. Whatever 
 restraint is larger than the necessary protection of the party can be 
 of no benefit to either ; it can only be oppressive, and,' if oppressive, it 
 is, in the eye of the law, unreasonable." The tendency in later cases 
 has certainly been to allow a restriction in point of space which for- 
 merly would have been thought unreasonable, manifestly because oi 
 the improved means of communication. A radius of ISO or even 
 200 miles has not been held too much in some cases. For the same 
 reason I think a restriction applying to the entire kingdom may in 
 other cases be requisite and justifiable. 
 
 I must, however, guard myself against being supposed to lay down 
 
Sec. 1) RESTRAINT OF TRADB 1231 
 
 that if this can be shown the covenant will in all cases be held to be 
 valid. It may be, as pointed out by -Lord Bowen, that in particular 
 circumstances the covenant might nevertheless be held void on the 
 ■ ground that it was injurious to the public interest. 
 
 My Lords, I turn now to the application of the law to the facts of 
 the present case. It seems to be impossible to doubt that it is shewn 
 that the covenant is not wider than is necessary for the protection 
 of the respondents. The facts speak for themselves. If the covenant 
 embraced anything less than the whole of the United Kingdom it is 
 obvious that it would be nugatory. The only customers of the re- 
 spondents must be found amongst the Governments of this and other 
 countries, and it would not practically be material to them whether 
 the business were carried on in one part of the United Kingdom or 
 another. 
 
 So far I have dealt only with the covenant in relation to the United 
 Kingdom. The appellant appeared willing to concede that it might 
 be gOod if limited to the United Kingdom ; but he contended that it 
 ought not to be world-wide in its operation. I think that in laying 
 down the rule that a covenant in restraint of trade unlimited in regard 
 to space was bad, the Courts had reference only to this country. They 
 would, in my opinion, in the days when the rule was adopted, have 
 scouted the notion that if for the protection of the vendees of a busi- 
 ness in this country it were necessary to obtain a restrictive covenant 
 embracing foreign countries, that covenant would be bad. They cer- 
 tainly would not have regarded it as against public policy to prevent 
 the person whose business had been purchased and was being carried 
 on here from setting up or assisting rival businesses in other coun- 
 tries; and for my own part I see nothing injurious to the public 
 interests of this country in upholding such a covenant. 
 
 When the nature of the business and the limited number of cus- 
 tomers is considered, I do not think the covenant can be held to ex- 
 ceed what is necessary for the protection of the covenantees. 
 
 I move your Lordships, therefore, that the judgment appealed from 
 be affirmed, and the appeal dismissed. * * * 
 
 HALL MFG. CO. v. WESTERN STEEL & IRON WORKS et al. 
 
 (Circuit Court of Appeals of the United States, 1915. 227 Fed. 588, 142 C. 
 C. A. 220, L. E. A. 1916C, 620.) 
 
 Suit in Equity by the Hall Manufacturing Company against the 
 •Western Steel & Iron Works. Decree for defendants, and complainant 
 appeals. Reversed. 
 
 BakER> Circuit Judge." This appeal is from a decree dismissing 
 appellant's bill on final hearing. 
 
 9 Part of tlie opinion is omitted. 
 
1232 ILLEGAL CONTRACTS (Ch. 9 
 
 Facts, counted on in the bill and established by the proofs, may be 
 summarized as follows : 
 
 Appellant, an Iowa corporation, located at Moijticello, was engaged 
 in making wire stretchers, hoisting blocks, stake irons, weed pullers; 
 and similar farm appliances, and in selling them; generally wherever 
 there was a demand. 
 
 Appellee, Western Steel & Iron Works, a Wisconsin corporation, 
 located at De Pere, was engaged in making farm gates, trowels, spades, 
 etc. It was organized in 1905. Prior to November 26, 1910, it also 
 made and sold post hole augers and diggers — diggers since 1905 
 and augers since the beginning of 1909. 
 
 During the summer and fall of 1910 appellee was financially em- 
 barrassed, its property was under mortgage, and it was in pressing 
 need of ready money. It solicited appellant to buy its digger and 
 auger business, which amounted to about half of its total business. 
 Officers of appellee visited Monticello, officers of appellant examined 
 the property at De Pere, and meetings were had at Milwaukee. On 
 November '26, 1910, appellee sold and conveyed to appellant every- 
 thing pertaining to the digger and auger business, machinery, tools, 
 dies, finished and unfinished stock, orders, patents, and "the good will 
 of the business." Collateral to the sale of the good will appellee 
 covenanted "to render such assistance as it reasonably can in introduc- 
 ing it (appellant) to the trade and in forwarding to it any orders it may 
 receive for augersand diggers after December lO, 1910," and "not again 
 to go into the manufacture of post hole augers and diggers." 
 
 At the time of the sale, when appellee's business in diggers was five 
 years old and in augers two, it had marketed these articles in thirty- 
 four of the United States and in two Canadian provinces. In consid- 
 erable regions these articles cannot be used. Appellee's sales were 
 entirely to jobbing houses. In addition to seed that had already 
 brought forth fruit, appellee through advertisements, commission men, 
 and the outstretched hands of jobbers had sown other seed, so thsft 
 we may take the fact to be in accordance with the admitted representa- 
 tion of appellee's treasurer that appellee was trying to sell wherever 
 there was a demand and that by reasonable attention the trade could 
 be expected to extend "throughout all parts of the United States and 
 Canada where augers and diggers can be used." So it is evident that 
 appellee was selling and was covenanting to protect a national and 
 international good will. 
 
 Appellant paid the agreed price, $13,500, less deductions, provided 
 for in the contract, of about $3,000 for appellee's failure to turn over 
 the stipulated amount of orders. The evidence in the record warrants 
 the conclusion that appellee under the contract obtained about double 
 the fair selling value of its worn machinery, tools, etc., and that 
 appellant would not have purchased the physical property apart from 
 the good will of the business and appellees' protective covenants. 
 
 This purchase was made by appellant because diggers and augers 
 
Sec. 1) 
 
 RESTRAINT OF TRADE ]^233 
 
 would fit in well with the lines of farm appliances it was already 
 making and selling. Neither before nor afterwards was appellant a 
 party to any combination or agreement for fixing prices or restraining 
 competition. And consumers have been able to purchase diggers and 
 augers at prices as low as formerly, under competition of the same 
 number of independent manufacturers doing business throughout the 
 country. 
 
 Appellant began promptly to manufacture and market the same 
 seven styles that appellee had been supplying to the trade, and under 
 the same seven names, which, except as to "Ideal" and "Western," for 
 which patents were assigned to appellant, had become generic names 
 of styles on which patents had expired. 
 
 Withm a month or so appellee, with its mortgage discharged and 
 its financial embarrassment relieved, began to manufacture all its 
 former open styles under the old names, and to sell them wherever it 
 could. When appellant learned of this conduct, some six months later, 
 it protested ; and, its protest being defied, this suit was begun. * * * 
 Is appellant remediless? The trial court so decided because the 
 protective covenants are without limitation of either time or place. 
 
 In the first reported case, that of John Dier, decided in 1415, Year 
 Book 2 Hen. V, 5, covenants were held to be unenforceable, no matter 
 how limited in time and place. Hull, J., said : "In my opinion you 
 might have demurred upon him, that the obligation is void, inasmuch 
 as the condition is against the common law; and (per Dieu) if the 
 plaintifiE were here he should go to prison till he paid a fine to the 
 king."" 
 
 During the generations when an artisan had to pass through ap- 
 prenticeship into a guild, when he was tied to his trade and place by 
 statutes forbidding him to leave his parish under pain of pillory or 
 prison, when if he could not stand where he was rooted he would 
 become a public charge, it may have been right enough for the king's 
 courts to see no public interest but the artisan's ability to pay taxes 
 and serve the king. If, however, fifteenth century doctrines of ab- 
 solutism were to govern in twentieth century conditions of democracy, 
 a victim of a covenantor's perfidy might well prefer to settle his legal 
 rights by the fifteenth century wager of battle. But the glory of the 
 common law is its inherent power of growth, its adaptability to new 
 and enlarged conditions of life, its respondence to higher standards 
 
 1" T. B. 2 Hen. V, pi. 26. Debt wag brought on an o~bligation of one John 
 Dyer, and the defendant, by his attorney, Loddington, alleged a certain inden- 
 ture, which was set forth, upon condition that if the defendant should not 
 use his art and craft of dyer in the town for half a year the obligation should 
 be null and void, and he said that he had not used his art and craft of dyer 
 within that time, and he asked judgment. Hull, J., said : In my opinion you 
 Could have demurred on the ground that the obligation is void, the condition 
 being against the common law, and by God if the plaintiff were here he should 
 go to prison until he made a fine to the king. Strange, for the plaintiff : We 
 allege that the defendant did use liis art within the time fixed by the condi- 
 tion. And the others joined issue. 
 
 COEBIN CONT.. — 78 
 
1234 ILLEGAL CONTRACTS (Ch. 9 
 
 of social and business ethics. And so during the centuries naturally 
 there were developments and d^artures with respect to this ancient 
 doctrine. It took the courts a long time to get beyond testing the 
 validity of a respective covenant purely by the presence or absence 
 of limitations. If a restraint was unlimited as to both time and place, 
 or was unlimited as to place though not as to time, it was unenforce- 
 able; if limited as to both time and place, or if limited as to place, 
 though not as to time, it was valid. 
 
 But, beginning about 1830, the advent of the factory system, mul- 
 tifold new machines, railroads, steamships, fast mail and express 
 service, telegraphs, telephones, wireless, trolleys, automobiles, aero- 
 planes, lessening space, shortening time, offering continually new and 
 widening avenues for both labor and capital, emphasized a point of 
 view that had been sugg'ested in somewhat earlier times ; and that is 
 that the validity of a restrictive covenant should be tested by deter- 
 mining whether on the facts of the particular case the restraint is 
 greater than is reasonably necessary for the protection of the pur- 
 chaser of the business and good will. The history of the development, 
 with its waves of progress and recession, may be traced in England 
 and our own country in the following cases ; n * * * 
 
 Tested by the rule of reason, a restrictive covenant is not necessarily 
 valid because it is limited in time and place. Logically the corollary 
 follows that by the same rule of reason' a restrictive covenant is not 
 necessarily invalid because it is unlimited in time and place. A re- 
 straint of 500 miles and 50 years on a village doctor, who had only 
 
 i^The court here cited: Dier's Case (1415), supra; Ipswich Taylor's 
 Case, 11 Coke, 53 (1615) ; Broad v. .ToUyfe, Cro. Jac. 596 (1621) ; Mitchell 
 V. Reynolds, 1 P. Williams, 181 (ITll) ; Bunn v. Guy, 4 East, 190 (1803,) ; 
 Homer v. Graves, 7 Bing. 735 (1831) ; Whittaker v. Howe, 3 Beavan, 383 
 (1841) ; Mallan v. May, 11 M. & W. 653 (1843) ; Price v. Green, 16 M. & W. 
 346 (1847) ; Tallis v. Tallis, 1 El. & El. 391 (1853) ; Harms v. Parsons, 32 
 Beavan, 329 (1862) ; Leather Cloth Co. v. Lorsant, 3i9 L. J. Ch. 86 (1869) ; 
 Hagg V. Darley, 47 L. J. Ch. 587 (1878) ; Rousillon v. Rousillon, 49 L. J. 
 Ch.338, 14Ch. D. 351 (1880) ; Baines v. Geary, 35 Ch. D. 154 (1887) ; Mills v. 
 Dunham, [1891] 1 Ch. 576; Badische Anilin und Soda Pabrik v. Schott 
 Segner & Co., [1892] 3 Ch. 447; Nordenfelt v. Maxim-Nordenfelt Guns and 
 Ammunition Co., [1894] App. Gas. 535, 63 L. J. Ch. 908; Dubowski & Sons 
 v. Goldstein, [1896] 1 Q. B. 478; Underw'ood v. Barker, [1899] 1 Ch. 300; 
 Haynes v. Doman, [1899] 2 Ch. 13 ; Lamson Pneumatic Tube Co. v. Phillips, 
 91 L. T. 363 (1904) ; Dowden & Pook, Liinited, v. Pook, [1904] 1 K. B. 45; 
 Henry Leetham & Sons, Limited, v. Johnstone-White, [1907] 1 Oh. 322; 
 Mason v. Provident Clothing & Supply Co., Ltd., [1913] A. C. 724; Nevans 
 & Co. V. Walker & Foreman, [1914] 1 Ch. 413; Oregon Steam Nav. Co. v. 
 Winsor, 20 Wall., (87 U. S.) 64, 22 L. Ed. 315 (1873) ; Diamond Match Co. 
 V. Roeber, 106 N. Y. 473, 13 N. E. 419, 60 Am. Rep. 464 (1887) ; Fowle v. 
 Park, 131 U. S. 88, 9 Sup. Ct. 658, 33 L. Ed. 67 (1888) ; Gibbs v. Consolidated 
 Gas Co. of Baltimore, 130 U. S. 396, 9 Snp. Ct. 553, 32 L. Ed. 979 (1888) ; 
 Carter v. Ailing (0. 0.) 43 ,Fed. 208 (1890) ; United States Chemical Co. 
 V. Provident Chemical Co. (0. 0.) 64 Fed. 946 (1894) ; Harrison v. Glucose 
 Sugar Refining Co., 116 Fed. 304, 53 C. C. A. 484, 58 L. B. A. 915 (1902) ; 
 National Enameling & Stamping Co. v. Haberman (C. 0.) 120 Fed. 415 
 (1903) ; Knapp v. S. Jar vis Adams Co., 135 Fed. 1008, 70 C. 0. A. 536 (1905) ; 
 Frame v. Ferrell, 166 Fed. 702, 92 C. 0. A. 374 (1909) ; Marshall Engine Co. 
 V. New Marshall Engine Co., 203 Mass. 410, 89 N. E. 548 (1909). 
 
Sec. 1) RESTRAINT OF TRADE 1235 
 
 a local, practice, would be unreasonable, because not reasonably neces- 
 sary to the protection of his successor, while a general covenant by 
 Pears Soap Company should be enforced (at least to the extent of 
 the decreeing court's reach) because the good will of the business is 
 world-wide and of expected indefinite continuance. 
 
 In Frame v. Ferrell, supra, a general covenant was enforced. The 
 court construed the covenant "as limiting the restraint to the United 
 States." In the present case the trial court accepted counsel's criticism 
 that our brethren of the Sixth circuit were violating the rule that 
 courts cannot lawfully remake the contract of the parties. But in 
 our judgment the same result of enforceability is reached by taking 
 the covenant as written, without limitation of time or place. For the 
 covenant is neither immoral nor criminal. It stands, unless it must 
 be overthrown on account of "the covenantor's objection. His objec- 
 tion is based wholly on our domestic public policy. Our domestic 
 public policy has no extraterritorial force. And therefore the lim- 
 itation of the decree, if so made, comes from the inherent, limitation of 
 the covenantor's objection, not from constructively limiting his unlim- 
 ited covenant. 
 
 In this case, and in all of the kind, two public interests are to be 
 balanced against the one that is opposed to restrictive covenants : 
 Honesty and fidelity among our business men; and the interest of 
 every one, and so of all, in being able to sell on the most advantageous 
 terms whatever property he owns or has produced, whether tangible 
 or intangible. Unless injury to the public rnanifestly outweighs the 
 public policies of honesty and of freedom of alienation, restrictive 
 covenants should be enforced. Here, of covirse, honesty condemns 
 the conduct- of appellee. Freedom of alienation is a byword, if appellee 
 may sell property, retain the proceeds, and then repossess itself of 
 the property with impunity. And what injury to the public was done 
 that preponderates over honesty and freedom of alienation in the 
 other scale? Appellee is a corporation. If any stockholder or officer 
 is skilled in any profession or art, he is not restrained from exercising 
 his skill by the corporation's covenant. Even the capital that was at 
 hazard in the digger and auger branch of appellee's factory may be 
 reinvested in the same business by the stockholders individually or col- 
 lectively outside of appellee corporation. Appellee itself, rescued from 
 financial embarrassment, and with its remaining business made sound 
 by the use of appellant's money has been benefited. Consumers in 
 Wisconsin and everywhere in our country get as fair prices as before, 
 under competition of the same number of independent manufacturers. 
 In our judgment there is no injury to the public, and the scale con- 
 taining honesty and freedom of alienation strikes bottom. Inasmuch 
 as the collateral covenants are no broader than, the conveyed good 
 will, full-grown and embryonic, they should be enforced. 
 ' But, apart from the covenants, we think appellant is not remediless. 
 If the covenants were considered void, that would not vitiate the con- 
 
1236 ILLEGAL CONTRACTS (Ch. 9 
 
 tract in other respects, since there is nothing immoral or criminal 
 in making such covenants. They are merely unenforceable civilly 
 at the worst. '^^ * * * 
 
 If one should sell a chattel, and then retake it by stealth or force 
 or fraud, both the criminal and the civil law would lay hold. Because 
 the retaking of a conveyed good will has not yet been included in the 
 penal code is no reason, in our judgment, why equity should hesitate 
 to arrest the trespass. 
 
 As to appellee corporation the decree is reversed, and the cause 
 remanded for proceedings in consonance with this opinion. 
 
 SHUTE v. SHUTE et al.^ 
 (Supreme Court of North Carolina, 1918. 176 N. C. 462, 97 S. B. 392.) 
 
 Action by J. R. Shute against J. T. Shute and another. Judgment 
 for defendants, and plaintiff appeals. Affirmed. 
 
 This was an action to enjoin the erection of a cotton gin in Monroe 
 upon the grcmnd that it was in violation of a contract between the plain- 
 tiff and the defendant J. T. Shute. 
 
 In May, 1916, J. R. Shute, the plaintiff, entered into a contract with 
 J. T. Shute, his brother, who with his son, J. E. Shute, are the defend- 
 ants. The contract in question specified that J. R. Shute sold to said 
 J. T. Shute for $4,000 the cotton gin plant in Monroe, specifying the 
 location and its contents, i. e. four 70 brush saw gins and fixtures, one 
 60 horse power electric motor and fixtures, and other appurtenances, 
 with a provision that said J . T. Shute should have "the exclusive priv- 
 ilege of buying and selling seed. cotton and cotton seed so far as the 
 said J. R. Shute is concerned, on the south side of Bear Skin creek 
 for a period of ten years from September 1, 1916." Said J. R. Shute 
 bound himself "neither to build nor cause to be built any ginning plant 
 in Union county on the south side of Bear Skin creek for a period of 
 ten years after September 1, 1916, and not to operate or cause to be 
 operated or be interested in any way with any person, firm, or corpora- 
 tion, in operating any ginning plant in Union county on south side of 
 Bear Skin creek for said period of ten years," and there was a further 
 
 12 The court liere cited : Western Union Telegraph Co. v. Burlington & 
 Southwestern Ry. Co. (C C.) 11 Fed. 1 (1882) ; Western Union Tel. Co. v. 
 Kansas Pacific Ry. Co. (D. C.) 4 Fed. 284 (1880) ; Ft. Smith Light & Trac- 
 tion Co. V. Keltey, 94 Ark. 461, 127 S. W. 975 (1910) ; Dean v. Emerson, 102 
 Mass. 480 (1869) ; Peltz v. Eiehele, 62 Mo. 171 (1876) ; Fishell v. Gray, 60 N. 
 J. Ijaw, 5, 37 Atl. 606 (1897) ; Kosenbaum v. U. S. Credit System Co., 65 N. 
 J. Law, 255, 48 Atl. 237, 53 L. R. A. 449 (1901) ; Union Locomotive & Ex- 
 press Co. V. Erie Ry. Co., 35 N. J. Law, 240 (1871) ; Smith's Appeal, 113 Pa. 
 579, 6 Atl. 251 (1886) ; Mallan v. May, 11 M. & W. 653 (1843) ; Price v. 
 Green, 16 M. & W. 346 (1847) ; Ohesman v. Nainby, 2 Lord Raym. 1456 
 (1726) ; Dubowski & Sons v. Goldstein, [1896] 1 Q. B. 478; Rogers v: Mad- 
 docks, [1892] 3 Ch. 346. 
 
Sec. 1) RESTRAINT OF TRADE 1237 
 
 provision that the defendant J. T. Shute should not engage or be 
 interested in ginning cotton or buying cotton seed or seed cotton> cot- 
 ton seed meal, or hulls for the said period of ten years on the north side 
 of Bear Skin creek in said county nor on the site of the gin plant which 
 he was then operating near the railroad depot in Monroe, which he 
 agreed to remove and did remove. 
 
 From the judgment dissolving a temporary restraining order and re- 
 fusing to continue the injunction to the hearing, the plaintiff appealed. 
 
 Ci^ARK, C. J. Bear Skin creek is practically the northern boundary 
 of Monroe. The contract which the plaintiff, J. R. Shute, is asking the 
 court to enforce, does not contain a provision for the sale of the good 
 will of the gin plant, and besides this action is not brought by the ven- 
 dee to protect the conveyance of the good will as an exception to the 
 rule against contracts in restraint of trade, but singularly enough it is 
 brought by the vendor to enforce a division of territory by which the 
 vendee was not to engage in the business north of Bear Skin creek nor 
 at the location near railroad depot in Monroe for 10 years, in considera- 
 tion of the agreement that the plaintiff was not to engage in the same 
 business of giniiing or buying cotton seed and seed cotton south of Bear 
 Skin creek. 
 
 The agreement sought to be enforced is clearly a division of the ter- 
 ritory named, with the creek for a boundary. The sole object is to 
 eliminate competition between the parties. This is an illegal purpose, 
 and the judge properly refused an injunction to the hearing. It is to 
 the interest of the public that there should be the freest competition in 
 a matter of this kind, and a contract to suppress it cannot invoke the 
 aid of the equitable jurisdiction of the court. 
 
 One of the oldest and best-settled principles of the common law 
 was that bonds in restraint of trade were illegal. This was held as 
 early as 2 Henry V. (A. D. 1415), and it was then stated in the Year 
 Books to be old and settled law. There was a modification of this rule 
 (Broad v. Jolyffe, Cro. Jac. 506), that a contract hot to use a certain 
 trade in a particular place was a reasonable restriction and did not come 
 under the general rule. 
 
 In Kramer v. Old, 119 N. C. 1, 25 S. E. 813, 34 L. R. A. 389, 56 
 Am. St. Rep. 650, it was held that the sale of the vendor's milling busi- 
 ness in Elizabeth City with stipulation against his remaining in the 
 business was not invalid. The court said : "The test of the reasonable- 
 ness of the territorial limit covered by such contracts is involved in the 
 question whether the area described in the contract is greater than it 
 is necessary to make it in order to protect the purchaser from com- 
 petition in his efforts to hold and get the full benefit of the business or 
 right of competition bought by him." 
 
 In Shute V. Heath, 131 N. C. 281, 42 S. E. 704, the court held: "A 
 provision, in a contract of sale of a business of manufacturing lumber 
 and ginning cotton, that the seller would not engage in the same busi- 
 
1238' ILLEGAL CONTRACTS (Ch, 9 
 
 ness in any territory in which the seller had secured patronage, isi void 
 for indefiniteness as to territory." / 
 
 The present contract is not void upon that ground but, because it 
 appears upon the face of it that the division of the territory is not for 
 the purpose of conveying to the defendant the right to obtain all 
 the patronage of the establishment which the plaintiff sold to the de- 
 fendants, but for the purpose of shutting off competition by preventing 
 the defendant from putting up any other plant or being interested in 
 the establishment of any other plant within all that part of the county 
 of Union north of Bear Skin creek. This is clearly against public in- 
 terest, which is that these ginning plants shall be multiplied according 
 to the needs of the public and shall not be restricted in number by agree- 
 ment between parties in that line of business. 
 
 This court has upheld the theory of a limited and reasonable re- 
 straint of trade, in several cases, i. e. : As to sales of stock and livery 
 business. Anders v. Gardner, 151 N. C. 604, 66 S. E. 665; King v. 
 Fountain, 126 N. C. 197, 35 S. E. 427. As to the milling business, 
 Kramer v. Old, 119 N. C. 6, 25 S. E. 813, 34 E. R. A. 389, 56 Am. St. 
 Rep. 650. : Newspaper business. Cowan v. Fairbrother, 118 N. C. 406, 
 24 N. E. 212, 32 E. R. A. 829, 54 Am. St. Rep. 733. Saloon business. 
 Jolly v. Brady, 127 N. C. 142, 37 S. E. 153 Medical practice. Hauser 
 V. Harding, 126 N. C. 295, 35 S. E. 586. Dtug business., Baker v. 
 Cordon,;86 N. C, 116, 41 Am. Rep. 448. In each of these cases the ac- 
 tion was brought by the vendee in order to protect the good will which 
 had been conveyed as an essential element of the business which he 
 had bought. , : 
 
 Even in such/ cases the test is the reasonableness and bona fides of 
 the contract in question, whether it is for the purpose of securing to the 
 purchaser merely the benefit of the good will of the business sold, or 
 whether it is partly at least for the purpose of suppressing competition. 
 Consequently, such contracts must be considered as to their reason- 
 ableness in duration of time, or extent of territory, largely in connection 
 with the nature of the business. A restriction as to territory which 
 would be reasonable in regard to issuing a newspaper which draws 
 from a large territory would not apply to the prohibition of the erec- 
 tion of ginning plants in which business it is burdensome to the public 
 to haul seed cotton any great distance to be ginned. 
 
 It appears in this case that J. R. Shute and J. T. Shute ginned at 
 least 80 per cent, of the cotton ,ginned in Monroe. From the nature of 
 the business, and of the commodities handled, the public had a material 
 interest in the subject-matter of this agreement, and the suppression 
 of all competition with respect to 80 per cent, of all the cotton ginned 
 and opportunites for buying and selling seed cotton and cotton seed in 
 the chief town of one of the larg;est cotton producing counties of the 
 state necessarily operated against the public interest and convenience. 
 The orohibition on the respective parties to erect any new ginning 
 
Sec. 1) EBSTKAINT OF TRADE 1239 
 
 plant, or to be interested in the same or in buying cotton seed or seed 
 cotton in all that part of Union county lying north or south, respective- 
 ly, of Bear Skin creek, was calculated and intended to prevent competi- 
 tion in that business. Still more so was this attempted restriction on the 
 vendee, which could not protect the good will of the business, bought 
 by him. Not only was the territory unnecessarily large for the protec- 
 tion of the buyer against competition by the vendor of the plant, but 
 the period of ten years was also excessive for such purpose.^* * * * 
 Affirmed.^* 
 
 1^ The court further held that the contract was made illegal by the stat- 
 ute of the state known as the "Anti-Trust Law." 
 
 ^* In the following cases the contract was held to be illegal, as there was 
 no sale of a business with its good will : Shapard v. Lesser, 127 Ark. 590, 193 
 S. W. 262, 3 A. L. R. 24T (1917), restraining the defendant from erecting a 
 cotton gin and becoming a comi)etitor in the buying of cotton seed ; Nester 
 V. Continental Brewing Co., 161 Pa. 478, 29 Atl. 102, 24 L. R. A. 247, 41 Am. 
 St. Rep. 894 (1894), 45 brewers agreed to sell no beer in Philadelphia at less 
 than $8 a barrel; Morris Run Coal Co. v. Barclay Coal Co., 68 Pa. 173, 8 
 Am. B«p. 159 (1871), i&ve companies agreed to divide their market and to sell 
 no coal except as determined, both as to amount and as to price, by a common 
 managing committee; Pearson v. Duncan & Son, 198 Ala. 25, 73 South. 406, 
 3 A. L. R. 242 (1916), a competitor was paid to retire from business; Bums 
 V. Wray Farmers' Grain Co., 65 Colo. 425, 176 Pac. 487 (1918), 230 grain 
 producers agreed to sell to no competitor of a grain corporation in which 
 they were stockholders, with a fixed penalty for breach ; American Laun- 
 dry Co. V. E. & W. Dry-Cleaning Co.,. 199 Ala. 154, 74 South. 58 (1917), two 
 laundries agreed that one should do no wet washing and the other no dry 
 cleaning; Joseph Evans & Co. v. Heathcote, [1918] 1 K. B. 418, pooling agree- 
 ment to restrict production and raise prices; Oliver v. Gilmore (C. C.) 52 
 Fed. 562 (1892) ; Santa Clara Val. M. & L. Co. v. Hayes, 76 Cal. 387, 18 Pac. 
 391, 9 Am. St. Rep. 211 (1888) ; Richardson v. Buhl, 77 Mich. 632, 43 N. W. 
 1102. 6 L. R. A. '457 (1889) ; Cummlngs v. Union Blue Stone Co., 164 Xn. Y. 
 401, 58 N. E. 525, 52 L. R. A. 262, 79 Am. St. Rep. 655 (1900) ; Emery v. Ohio 
 Candle Co., 47 Ohio St. 320, 24 N. E. 660, 21 Am. St. Rep. 819 (1890), a pooling 
 agreement to restrict output and maintain prices; Clemons v. Meadows, 123 
 Ky. 178, 98 S. W. 13, 6 L. R. A. (N. S.) 847, 124 Am. St. Rep. 339 (1906), 
 payment to competing hotel to induce it to keep closed ; U. S. v. Addyston 
 Pipe & Steel Co., 85 Fed. 271, 29 C. C. A. 141, 46 L. R. A. 122 (1898), combina- 
 tion of competitors to raise prices, the cases being thoroughly reviewed by 
 Taft, J.; affirmed 175 U. S. 211, 20 Sup. Ct. 96, 44 L. Ed. 136 (1899). 
 
 The common law appears to afford no remedy other than to declare such 
 contracts illegal and void when suit is brought to enforce them. An injunc- 
 tion in equity was refused in Queen Ins. Co. v. State, 86 Tex. 250, 24 S. W. 
 397, 22 L. R. A. 483 (1893). But cf. McCarter v. Firemen's Ins. Co., 74 N. J. 
 Eq. 372, 73 Atl. 80, 29 L. R. A. (N. S.) 1194, 135 Am. St. Rep. 708, 18 Ann. 
 
 The federal Aiiti-Trust Law (the Sherman Act, of 1890), 26 Stat. 209 (U. 
 S Comp St. § 8820 et seq.), provides for criminal prosecution and for tort 
 actions by persons injured. In United States v. Addyston Pipe & Steel Co., 
 85 Fed. 271. 29 O. C. A. 141, 46 L. R. A. 122 (1898), Taft, J., said: "Contracts 
 that were in unreasonable restraint of trade at common law were not unlaw- 
 ful in the sense of being criminal, or giving rise to a civil action for damages 
 in favor of one prejudicially affected thereby, but were simply void, and were 
 not enforced by the courts. M9gul S. S. Co. v. McGregor, [1892] A. C. 25; 
 Hornby v. Close, L. R. 2 Q. B. 153 (1867) ; Lord Campbell, C. J, in Hilton v. 
 Eckerslev, 6 El. & Bl. 47, 66 (1855) ; Hannen, J., in Farrer v. Close, L. R. 4 
 Q B. 602, 612 (1869). The effect of the act of 1890 is to render such con- 
 tracts unlawful in an affirmative or positive sense, and punishable as a mis- 
 demeanor, and to create a right of civil action for damages in favor of those 
 
1240 ILI,BGAL, CONTRACTS (Ch. 9> 
 
 MORE et al. v. BENNETT et al. 
 
 (Supreme Court of Illinois, 1892. 140 111. 69, 29 N. E. 888, 15 L. K. A. 361,- 
 
 33 Am. St. Kep. 216.) 
 
 This was a suit in assumpsit, brought by R. Wijson More and 
 others, composing the firm of More & Dundas, against J. L,. Bennett 
 and others, composing the firm of Bennett, Edwards & Pettit, to recover 
 damages resulting from an alleged breach of certain rules and by- 
 laws of the Chicago Law Stenographers' Association, of which both 
 the plaintiffs and defendants are members. To .the declaration, which 
 consists of two special counts, a demurrer was sustained, and, the 
 plaintiffs electing to abide by their declaration, judgment was ren- 
 dered in favor of the defendants for costs. Said judgment has been 
 affirmed by the appellate court on appeal, and the present appeal is 
 from said judgment of affirmance. 
 
 The first Count of the declaration alleges, in substance, that the plain- 
 tiffs and defendants are all stenographers by profession, and have,, 
 from the time of its organization, been members of said association, 
 an association formed to jpromote the interest of its members by all 
 proper methods, and to establish and maintain reasonable, proper, and 
 uniform rates for stenographic work done by the members of said 
 association, and to secure to judges, lawyers; and citizens of Chica- 
 go efficient, competent, and reliable law reporting, at reasonable, proper, 
 and uniform rates, and to furnish them with the means of obtaining" 
 efficient and competent reporters, and to increase the efficiency of law 
 reporting in the county of Cook. That, in accordance with its consti- 
 tution and by-laws, said association had adopted a schedule of rates 
 which were and are fair and reasonable, and had for more than 15 
 years prior to the organization of said association been the established 
 rates among law stenographers, and had been and are still recognized 
 as reasonable and established rates by judges and members of the legal 
 fraternity, and by law stenographers of the city of Chicago, there hav- 
 ing been during said time no material variation from said rates among 
 law stenographers, said rates being less than those established in cer- 
 tain other large cities of the United States for the same class of 
 work. 
 
 Said count further alleges that, in consideration of like promises and 
 agi-eements on the part of the plaintiffs, and like payment of the mem- 
 bership fee of $5 by each of the plaintiffs to become members of said 
 
 injured thereby, and a civil remedy by injunction in favor of both private 
 persons and the public against the execution of such contracts and the main- 
 tenance of such trade restraints." For other cases applying this federal stat- 
 ute, see Kales' Cases on Restraint of Trade, chapter II ; also L. R. A. 1917A, 
 376, 379. 
 
 There are many state statutes similar to the federal act. See People v. 
 Sheldon, 139 N. Y. 251j 34 N. E. 785, 23 L. R. A. 221, 36 Am. St. Rep. 690 
 (1893), indictment for conspiracy; Shute v. Shute, supra; note in L. R. A. 
 1917A, 376. 
 
Sec. 1) RESTRAINT OF TRADE 1241 
 
 association, the defendants promised and agreed with the plaintiffs 
 that they would be bound in their charges for work by the schedule of 
 rates adopted by said association. That the defendants might cut 
 rates against persons not members of said association, provided such 
 cutting was in good faith and the rights of the plaintiffs were re- 
 spected. That in no case where the defendants had any knowledge of 
 the existence of a contract or reporting arrangement between the 
 plaintiffs and any lawyer, corporation, or any other person would they 
 attempt, by underbidding the rate established by said association or 
 other unfair means, to secure such reporting. 
 
 That the rates established by said association were as follows : Not 
 less than 20 cents per folio for single copy ; not less than 25 cents per 
 folio for two copies ; not less than 28 cents per folio for three copies : 
 and the rate of $10 per day for attendance, with the qualification that, 
 if a reporter was engaged by one of the parties to a suit, he or any 
 other reporter, knowing of such engagement, might take the other side 
 of the case for $5 per day ; bttt in no case should the reporter make 
 any offer to any attorney after being informed by such attorney that he 
 had engaged a reporter. 
 
 That while said association was in existence, and the plaintiffs and 
 defendants were members thereof, the plaintiffs entered into a contract 
 or reporting arrangement with the county of Cook, by which said coun- 
 ty employed the plaintiffs to report the proceedings and furnish tran- 
 scripts thereof, as said county should require, in a certain celebrated 
 murder case then pending in the criminal court of Cook county, to-wit, 
 the case of People v. O'SuUivan and others, known as the "Cronin 
 Trial," said employment by said county' being on the following terms, 
 to-wit, $10 per day for Attendance, and the regular rates for transcripts 
 as established by said association, the plaintiffs agreeing with said 
 county to do said work, if the county should demand it, at as low a 
 rate as any reputable and established stenographer or firm of stenogra- 
 phers should in good faith bid for said work. 
 
 That the plaintiffs entered upon the performance of said contract, 
 and were engaged in reporting the proceedings at said trial at said 
 regular rates, yet the defendants, well knowing the premises, and the 
 aforesaid contract or reporting arrangement between the plaintiffs and 
 said county, and after the plaintiffs had been engaged on said case 
 for, to-wit, seven weeks, and at a time, when defendants well knew 
 that the plaintiff had performed the most unprofitable part of said 
 contract, and not regarding their said promise so made to the plain- 
 tiffs, did not respect the rights of the plaintiffs and the schedule rates 
 so adopted by said association, and the fact that they knew that there 
 was a reporting arrangement or contract between the plaintiffs and 
 said county, but solicited said county, -and endeavored to secure from 
 said county, by underbidding and other unfair means, employment as 
 law stenographers to report and furnish transcripts of the proceedings 
 
1242 ILLEGAL CONTRACTS (Ch. 9 
 
 at said trial, and made a certain bid to said county, by which, they of- 
 fered to do said work at a less rate than that established by said as- 
 sociation to- wit, $5 per day for attendance, 20 cents per folio for a 
 single copy, 22 cents per folio for two copies, and all copies above two 
 free of charge. 
 
 That thereupon the plaintiffs, because of said bid of the defendants, 
 were required by said county to meet said bid, or to cease their em- 
 ployment on said trial, as by the terms of said employment said coun- 
 ty had a right to do; and that the plaintiffs, for the purpose of re- 
 maining in employment on said trial, did meet the said bid of the de- 
 fendants, and afterwards reported and furnished transcripts of the 
 proceedings on said trial at the rates offered by the defendants; by 
 means whereof they were deprived of divers gains and profits which 
 would have accrued to them from the reporting and furnishing tran- 
 scripts on said trial under the regular rates of said association, and 
 in accordance with their, original bid, and have suffered great loss 
 and damage through the wrongful conduct of the defendants, to the 
 damage of the plaintiffs in the sum of $3,000; and therefore they 
 bring their suit, etc. 
 
 The second count contains substantially the same allegations as the 
 first, and also the following: That said association, numbers among 
 its members only a small portion of the law stenographers of the city 
 of Chicago, and that said association was formed because a system 
 of ruinous competition had sprung up among the stenographers of 
 said city, by which the prices of stenographic work were depressed 
 below reasonable rates, and also because a discreditable and dishon- 
 orable system of solicitation for business had sprung up, by which 
 efforts were made on the part of stenographers to induce attorneys, cor- 
 porations, and other persons to break their contracts already made .with 
 other stenographers, and that the objects of said association were to 
 prevent said discreditable and dishonorable solicitation, and to pro- 
 mote the interests of the members thereof by all proper methods, and 
 to establish and maintain proper and uniform rates for stenographic 
 work done by its members. 
 
 Said second count also set out, in extenso, the constitution, by-laws, 
 and schedule of rates of said association, said constitution containing, 
 among other things, the following provisions : "The object of this as- 
 sociation shall be to promote the interests of the members thereof by 
 all proper methods, particularly to establish and maintain proper rates 
 for stenographic work done by members of the association. Any rep- 
 utable stenographer, regularly engaged in law reporting in Cook coun- 
 ty, shall be eligible to membership under the rules hereinafter provided. 
 The association may adopt a schedule of rates to be charged by the 
 members for stenographic work done by them, which schedule shall be 
 binding upon every member." 
 
 Among the by-laws adopted by said association were the following : 
 "The membership fee shall be $5. The expenses of the association. 
 
Sec. 1) RESTRAINT OB" TRADE 1243 
 
 above amount received for membership fees, shall be paid out of a fund 
 to be collected by assessment, to be levied by the board of directors from 
 time to time, as may be necessary. The members of this association 
 shall respect each other's rights, and in no case where a member has 
 knowledge of the existence of a contract or reporting arrangement 
 between a fellow-member and a lawyer, corporation, or any other per- 
 son shall he attempt, by underbidding or other unfair means, to se- 
 cure such reporting; but members of this association may cut rates 
 against outsiders, if they choose ; such cutting, however, must be done 
 in good faith, or the member will be liable to fine, as provided for other 
 violations of the constitution and by-laws." 
 
 Said by-laws also provide, in case of any violation of the rules of said 
 association by any of its members, for a trial of the member accused of 
 such violation by a special arbitration committee, and the imposition of 
 a fine, in case of conviction, of not less than $10, nor more than $25, to 
 be paid into the treasury of the association, with the right on the part 
 of the accused to an appeal to a meeting of the entire association to be 
 called for that purpose; and it is further provided that, "in cases 
 where the differences between members require financial adjustment, 
 the said arbitration committee shall decide between the parties," 
 with right of appeal from the decision of said committee to any reg- 
 ular or special meeting of the association, whose decision in the mat- 
 ter is final. 
 
 The assignments of error call in question the decision of the circuit 
 court sustaining the demurrer to said declaration. 
 
 Bailey, J. (after stating the facts). , The question is raised by 
 counsel, and discussed at some length, whether membership in the Chi- 
 cago Law Stenographic Association established a contractual relation 
 between the plaintiffs and defendants which gives to the plaintiffs a 
 right of action against the defendants for a violation of any of the rules 
 of said association, as for a breach of contract; and also whether the 
 only remedy for a violation of said rules is not that provided by the 
 by-laws of the association, viz., a fine, to be imposed upon the offend- 
 er, after a trial and conviction before an arbitration committee, duly 
 appointed for that purpose. But, as we view the case, it will be un- 
 necessary for us to consider these questions ; since, adraittmg that the 
 constitution and by-laws of the association were in the nature of a 
 contract as between the members inter se, we are of the opmion that 
 the contract thus established is so far obnoxious to well-settled rules 
 of public poHcy as to render it improper for the courts to lend their 
 aid to its enforcement. . . . 
 
 Whatever may be the professed objects of the association, it clear- 
 ly appears, both from its constitution and by-laws, and from the aver- 
 ments of the declaration, that one of its objects, if not its leading ob- 
 ject is to control the prices to be charged by its members for steno- 
 graphic work, by restraining all competition between them. Powe'- ^s 
 given to the association to fix a schedule of prices which shall be bind- 
 
1244 ILLEGAL CONTRACTS (Ch. Q> 
 
 ing tipon all its members, and not only do the members, by assenting ta 
 the constitution and by-laws, agree to be bound by the schedule thus 
 fixed, but their competition with each other, either by taking or offering 
 to take a less price, is punishable by the imposition of fines, as well as 
 by such other disciplinary measures as associations of this character 
 may adopt for the enforcement of their rules. 
 
 The rule of pubHc policy here involved is closely analogous to that 
 which declares illegal and void contracts in general restraint of trade, 
 if it is not, indeed, a subordinate application of the same rule. As said 
 by Mr. Tiedeman: "Following the reason of the rule which prohibits 
 contracts in restraint of trade, we find that it is made to prohibit all 
 contracts which in any way restrain the freedom of trade or dimin- 
 ish competition, or regulate the prices of commodities or services. All 
 combinations of capitalists or of workmen for the purpose of influenc- 
 ing trade in their especial favor, by raising or reducing prices, are so- 
 far illegal that agreements to combine cannot be enforced by the 
 courts." Tied. Com. Paper, § 190. 
 
 Many cases may be found in which the doctrine here stated has been 
 laid down and enforced. Thus in Stanton v. Allen, 5 Denio, 434, 49 
 Am. Dec. 282, where an association among the whole or a large part 
 of the proprietors of boats on the Erie and Oswego canals was formed 
 upon an agreement to regulate the price of freight and passage by a 
 uniform scale to be fixed by a committee chosen by themselves, and to 
 divide the profits of their business according to the number of boats 
 employed by each, with provisions prohibiting the members from en- 
 gaging in similar business out of the association, it was held that, as the 
 tendency of such "agreement was to increase prices and to prevent 
 wholesome competition, as well as diminish the public revenue, it was 
 against public policy and void, by the principles of the common law. 
 
 In Hooker v. Vandewater, 4 Denio, 349, 47 Am. Dec. 258, the pro- 
 prietors of five several lines of boats engaged in the business of trans- 
 porting persons and freight on the Erie and Oswego canals entered 
 into an agreement in which, "for the purpose of establishing and main- 
 taining fair and uniform rates of freight, and equalizing the business 
 among themselves, and to avoid all unnecessary exp>ense in doing the 
 same," they agreed to run for the residue of the season of navigation 
 at certain rates of freight and passage then fixed upon, but whi«h 
 should be changed whenever the parties should deem expedient, and to 
 divide the net earnings among themselves according to certain fixed 
 proportions ; and it was held, in a suit on the agreement against a 
 party who failed to make payment according to its terms, that the agree- 
 ment was a conspiracy to commit an act injurious to trade, and was il- 
 legal and void. 
 
 In Morris Run Coal Co. v. Barclay Coal Co., 68 Pa. 173, 8 Am. 
 Rep. 159, five coal companies in Pennsylvania entered into an agree- 
 ment in New York to divide two coal regions of which they had con- 
 trol ; to appoint a committee to take charge of their interest, and de- 
 
Sec. 1) EBSTKAINT OF TRADE 1245 
 
 cide all questions ; and appoint a general agent at a certain point in 
 the state of New York, the coal mined to be delivered through him, 
 each company to deliver its proportion at its own cost at the different 
 markets, at such time and to such persons as the committee should 
 direct, the committee to adjust all prices, rates of freight, etc., and 
 settlements to be made between the several companies monthly; 
 and it was held, in a suit brought by one of said companies against 
 another, to enforce a liability arising under said contract, that the 
 contract was in violation of a statute of New York making it a misde- 
 meanor to conspire to commit any act injurious to trade or commerce, 
 and was also against public policy, and therefore illegal and void; the 
 court laying down the rule, among other things, that every association 
 formed to raise or depress prices beyond what they would be, if left 
 without aid or stimulus, was criminal. 
 
 In Craft v. McConoughy, 79 111. 346, 22 Am. Rep. 171, a contract 
 was entered into by all the grain dealers in a certain town which, on 
 its face, indicated that they had formed a partnership for the pur- 
 pose of dealing' in grain, but the true object of which was to form a 
 secret combination which would stifle all competition, and enable the 
 parties, by secret and fraudulent means, to control the price of grain, 
 costs of storage, and expense of shipment at such town; and it was 
 held, on bill filed for an accounting and distribution of profits, that 
 such contract was in restraint of trade, and consequently void on 
 grounds of public policy. In discussing the principles involved, this 
 court said : "While these parties -were in business in competition with 
 each other, they had the undoubted right to establish their own rates 
 for grain stored and commissions for shipment and sale. They could 
 pay as high or low a price for grain as they saw proper, and as they 
 could make contracts for witb the producer. So long as competition 
 was free, the interest of the public was safe. The laws of trade, in 
 connection with the rigor of competition, were all the guaranty the 
 public required ; but the secret combination created by the contract de- 
 stroyed all competition, and created a monopoly against which the pub- 
 He interest had no protection." 
 
 The doctrine of the foregoing decisions may, in our opinion, be fair- 
 ly applied to the facts in the present case. While some of the cases 
 cited involve elements not present here, the determining circumstance 
 in all of them seems to have been a combination or conspiracy among 
 a number of persons, engaged in a particular business, to stifle or pre- 
 vent competition, and thereby to enhance or diminish prices to a point 
 above or below what they would have been if left to the influence of 
 unrestricted competition. All such combinations are held to be con- 
 trary to public policy, and the courts, therefore, will refuse to lend their 
 aid to the enforcement of the contracts by which such combinations 
 are sought to be effected^ 
 
 Counsel seek to distinguish this case from those cited by the cir- 
 cumstancCj alleged in the second count of the declaration, that but a 
 
1246 ILLEGAL. CONTRACTS (Ch. 9 
 
 • small portion bi the law stenographers of Chicago belong to said as- 
 sociation. An analogy is thereby sought to be raised between the con- 
 tract in this case and those contracts in partial restraint of trade, which 
 the law upholds. We think the analogy tjius sought to be raised does 
 not exist. Contracts in partial restraint of trade which the law sus- 
 tains are those which are entered into by a vendor of a business and 
 its good- will with his vendee, by which the vendor agrees not to engage 
 in the same business within a limited territory, and the restraint, tO be 
 valid, must be no more extensive than is reasonably necessary for the 
 protection of the vendee in the enjoyment of the business purchased. 
 But in the present case there is no purchase or sale of any business, nor 
 any other analogous circumstance giving to one party a just right to 
 be protected against competition from the other. All of the members 
 of the association are engaged in the same business within the same 
 territory, and the object of the association is purely and simply to si- 
 lence and stiiie all competition as between its members. No equitable 
 reason for such restraint exists; the only reason put forward be- 
 ing that, under the influence of competition as it existed prior to the 
 organization of the association, pi-ices for stenographic work had 
 been reduced too far, and the association was organized for the' pur- 
 pose of putting an end to all competition, at least as between those who 
 could be induced to become members. True, the restraint is not so 
 fiar-reaching as it would have been if all the stenographers in the city 
 had joined the association, but, so far as it goes, it is of precisely the 
 same character, produces the same results, and is subject to the same 
 legal objection. 
 
 It may also be observed that, by the constitution of the association, 
 any reputable stenographer, regularly engaged in law reporting in Cook 
 county, is eligible to membership, and, if all or a major part of the 
 stenographers in said county engaged in that business are not already 
 members, it is because the association has npt yet fully accomplished 
 the purposes of its organization. We can see no legal difference be- 
 tween the restraint upon competition which it now exercises and that 
 which it will exercise when it is in a position to dictate terms to all who 
 are engaged in the business, and to all who may wish to obtain the serv- 
 ices of law stenographic reporters. 
 
 We are of the opinion that the demurrer to the declaration was 
 properly sustained, and the judgment will therefore be affirmed.^' 
 
 15 Of. Collins V. Locke (P. C.) L. E. 4 App. Cas. 674 (1879), where the court 
 said: 'The objects which this agreement has in view are to parcel out the 
 stevedoring business of the port amongst the parties to it, and so to prevent 
 competition, at least amongst themselves, and also it may be to keep up tne 
 price to be paid for the work. Their Lordshijxs are not prepared to say that 
 an agreeuLent, having these objects, is invalid if carried into effect by proper 
 means, that is, by provisions reasonably necessary for the purpose, though the 
 effect of them might be to create a partial restraint upon the power of the 
 parties to exercise their trade." However, the court held that one provi- 
 sion of the, contract was unreasonable and void, in that it forbade all the 
 
Sec. 1) RESTRAINT OF TRADE 1247 
 
 TODE et al. v. GROSS. 
 
 (Court of Appeals of New York, 1891. 127 N. Y. 480, 28 N. E. 469, 13 L. R. A. 
 652, 24 Am. St. Rep. 475.) 
 
 Appeal by defendant from a judgment of the general term of the 
 supreme court in the second judicial department, affirming a judgment 
 entered upon the decision of the court after a trial without a jury. 
 Affirmed. 
 
 Action for breach of covenant to recover the sum of $5,000 as 
 ' stipulated damages. On the 15th of October, 1884, the defendant 
 owned a cheese factory situate in the town of Monroe, Orange coun- 
 ty, comprising two parcels of land, with the buildings thereon, and a 
 quantity of fixtures, machinery, and tools connected therewith. For 
 some tiine prior, with the assistance of her husband, Conrad Gross, 
 her brother-inrlaw, August Gross, and her father, John Hoffman, she 
 had been engaged in the business of manufacturing cheeses at said 
 factory known as "Fromage de Brie," "Fromage d'Isigny," and "Neuf- 
 chatel." Such cheeses were made by a .secret process known only to 
 herself and her said agents. On the day last named, she entered into 
 a sealed agreement with the plaintiffs, whereby she agreed to sell and 
 transfer to them the said factory and all its belongings, together with 
 the "good-will, custom, trade-marks, and names used in and belonging 
 to the said business," for the sum of $25,000, to be paid and se- 
 cured March 1, 1885, when possession was to be given. Said instru- 
 ment contained, a covenant on her part that she would "communicate 
 after the first day of March, 1885, or cause to be communicated, to" 
 said plaintiffs, "by Conrad Gross, John Hoffman, and August Gross, 
 or one or other of them, the secret of the manufacture of the cheeses 
 known as 'Fromage de Brie,' 'Neufchatel,' and 'D'Isigny,' and the 
 recipe therefor, and for each of them, and will instruct or cause to be 
 instructed them, and each of them, in the manufacture thereof.. And 
 that she and the said Conrad Gross, John Hoffman, and August Gross 
 will refrain from communicating the secret recipe and instructions for 
 the manufacture of said cheeses, or either of them, to any and all per- 
 sons other than the above-named parties of the second part, [plam- 
 tiffs ] and will also, after the first day of April, 1885, refram from en- 
 gaging in the business of making, manufacturing, or vending of said 
 cheeses or either of them, and from the use of the trade-marks or 
 names, 'or either of them, hereby agreed to be transferred m con- 
 
 RtPvPdores to load a vessel in case the master refused to epploy the par- 
 ttollar one to whom the ship had been allotted by the association of steve- 
 ^-^o= TTnfl It permitted the other stevedores to do the work, even though 
 requikn? them toThare the compensation with the particular stevedore ap- 
 
 ^^'^^k^L^^^TZlSntr^fsea shop, made by the labor unions and the 
 harmafuflXrers of Danbury, was held unlawful in Connors v. Connolly, 86 
 Conn. 641, 86 A:tl. 600, 45 L. R. A. (N. S.) 564 (1913). 
 
1248 ILLEGAL CONTRACTS (Ch. 9 
 
 nection with said cheeses, or either of them, or with any similar prod- 
 uct, under the penalty of five thousand dollars, which is hereby named 
 as stipulated damages to be paid by the party of the first part, [defend- 
 ant,] or her heirs, executors, administrators, or assigns, in case of a 
 violation by the party of the first part [defendant] of this covenant, 
 of this contract, or any part thereof, within five years from the date 
 hereof." She further covenanted that she herself, as well as "said 
 Conrad Gross, John HofiFman, and August Gross, during and up to 
 and until the first day of May, 188S, shall continue and remain in said 
 county of Orange, and from time to time, and at all reasonable times 
 during said period, by herself, or by said Conrad Gross, John Hoff-» 
 man, and August Gross, whenever so requested by the said parties of 
 the second part, [plaintiffs,] impart to them, or either of them, the 
 secret of making such cheeses, and each of them, and instruct them, 
 and each of them, in the process of manufacturing the same, and each 
 of them, as fully as she or the said Conrad Gross, John HofiFman, or 
 August Gross, or either of them, are informed concerning the same." 
 
 Both parties appear to have duly kept and performed the agree- 
 ment, except that, as the trial court found, "subsequently to the 1st 
 day of May, 1885, Conrad Gross, the husband of defendant, went to 
 New York city, and engaged in the business of selling 'foreign and do- 
 mestic fruits, and all kinds of cheese and sausages, &c.,' * * * and 
 while so engaged * =it * gold and personally delivered from his 
 place of business to one John Wassung three boxes of cheese marked 
 and named 'Fromage d'Isigny,' and h'aving substantially the same trade- 
 marks thereon as that sold by defendant to plaintiffs, and having 
 stamped thereon the name 'Fromage d'Isigny,' and that said cheese so 
 sold by hini to said Wassung was a similar product to that formerly 
 manufactured by defendant." Also, that "said August Gross, the 
 brother-in-law of defendant, subsequent to the 1st day of May, 1885, 
 engaged in the business of retailing fancy groceries in the city of New 
 York, and in and during the fall of 1887, and prior to the commence- 
 ment of this action, kept for sale at his place of business in New York 
 city boxes of cheese marked or stamped 'Fromage d'Isigny.' " The 
 court further found that the cheese so sold by Conrad Gross under 
 the name of "Fromage d'Isigny," "was never sold by plaintiffs, nor 
 made or manufactured by them, or either of them, but that the same 
 was a similar product." The court found as conclusions of law that 
 said agreement was a reasonable one, and was founded upon a good 
 and sufficient consideration; that said sale by Conrad and said keep- 
 ing for sale by August Gross was a direct violation of the covenant 
 in question; that the restriction imposed was no more than the in- 
 terests of the parties required, and that it was not in restraint of trade 
 or against public policy. Judgment was ordered for the plaintiffs for 
 the sum of $5,000, as stipulated damages. 
 
 Vann, J. (after stating the facts). The business carried on by 
 the defendant was founded on a secret process known 'only to her- 
 
Sec. 1) RESTRAINT OF TRADE 1249 
 
 self and her agents. She had the right to continue the business, and 
 by keeping her secret to enjoy its benefits to any practicable extent. 
 She also had the right to sell the business, including as an essential, 
 part thereof the secret process, and, in order to place the purchasers in 
 the same position that she occupied, to. promise to divulge the secret 
 to them alone, and to keep it from every one else. In no other way 
 could she sell what she had, and get what it was worth. Having the 
 right to make this promise, she also had the right to make it good to 
 her vendees, and to protect them by covenants with proper safeguards 
 against the consequences of any violation. Such a contract simply left 
 matters substantially as they were before the sale, except that the sell- 
 er of the secret had agreed that she would not destroy its value after 
 she had received full value for it. The covenant was not in general re- 
 straint of trade, but was a reasonable measure of mutual protection 
 to the parties, as it enabled the one to sell at the highest price, and the 
 other to get what they paid for. It imposed no restriction upon either 
 that was. not beneficial to the Other, by enhancing the price to the sell- 
 er, or protecting the purchaser. Recent cases make it very clear that 
 such an agreement is not opposed to public policy, even if the restric- 
 tion was unlimited as to both time and territory. Match Co. v. Roeb- 
 er, 106 N. Y. 473, 13 N. E. 419, 60 Am. Rep. 464; Hodge v. Sloan, 
 107 N. Y. 244, 17 N. E. 335, 1 Am. St. Rep. 816; Leslie v. Lorillard, 
 110 N. Y. 519, 534, 18 N. E. 363, 1 L. R. A. 456; Thermometer Co. v. 
 Pool (Sup.) 4 N. Y. Supp. 861. The restriction under consideration, 
 however, was not unlimited as to time. 
 
 The chief reliance of the defendant in this court, where, the point 
 seems to have been raised for the first time, is that tlie covenant, so 
 far as stipulated danlages are concerned, is confined to the personal 
 acts of Mrs. Gross, and does not embrace the acts of her agents. A 
 careful reading of the agreement, however, in the light of the cir- 
 cumstances surrounding the parties when it was made, shows that no 
 such result was intended. What was the object of the covenant? 
 It was to keep secret, at all hazards, the process upon which the suc- 
 cess of the business depended. On no other basis could the plaintiffs 
 safely buy, or the 'defendant sell, for what her property was worth. 
 Who had the power to keep the process secret? Clearly the defendant, 
 if any one, as she had confided it to no one except, her trusted agents, 
 who were nearly related to her by blood or marriage. But could she 
 covenant against the acts of those over whom she had no control? 
 She had the right to so covenant, by assuming the risk of their ac- 
 tions ; and, unless she had done so, presumptively she could not have 
 sold her factory for so large a sum. It was safer for her fo sell 
 with such a covenant than it was for the plaintiffs to buy without it. 
 She could exercise some power over her own husband and her father 
 and her husband's brother, all of whom had been associated with her 
 in carrying on the business, and whose actions in certain other respects 
 she assumed to control for a limited time, whereas the plaintiffs were 
 
 OOEBIN CONT 79 
 
1250 ILLEGAL CONTRACTS (Ch. 9 
 
 powerless, unless they had her promise to keep the process secret at 
 the peril of paying heavily if she did not. It is not surprising, there- 
 fore, to find that the restrictive part of the covenant applies with the 
 same force to her agents that it . does to herself ; for she undertakes 
 that neither she nor they will disclose the secret or engage in making 
 or selling either kind of cheese, or use the trade-marks or names con- 
 nected with the business. 
 
 We do not think that a personal act of the defendant is essential to 
 a violation, of this covenant by her ; for if she permits, or even does 
 not prevent, her agents from doing the prohibited acts, the promise 
 is broken. While it is her exclusive covenant, it relates to the action of 
 others ; and, if they do what she agreed that they would not do, it is 
 a breach by her, although not her own act. She violated her agreement, 
 not by selling herself, but by not preventing others from selling. This 
 construction of the restrictive part of the covenant would hardly be 
 open to question, were it not that in the same sentence occurs the re- 
 parative or compensatory part designed to make the plaintiffs whole if 
 the defendant either could not or did not keep her agreement. While 
 this provides that any violation involves the penalty of $5,000, it adds, 
 ■'which sum is hereby named as stipulated damages to be paid" by the 
 defendant in case of a violation by her of the covenant in question. 
 What kind of violation is thus referred to? The defendant says a 
 personal violation by her only, but we think, for the' reasons already 
 given, that the spirit of the agreement includes both a violation by, her 
 own act and by the act of those whom she did not prevent from sell- 
 ing, although she had agreed that they would not selL '■ As no one not 
 a party to a contract can violate it, every act of defendant's former 
 agents contrary to her covenant was a violation thereof by her, wheth- 
 er she knew of it or assented to it or not. Whenever that was done 
 which she agreed should not be done, it was a breach of a covenant 
 by her, even if the act was contrary to her wishes, and in spite of her 
 efforts to prevent it. Her covenant was against a certain act by any 
 one of four persons, including herself. Two of those persons sepa- 
 rately did the act which she had agreed that neither of them should 
 do, and thus there was a violation of the covenant by her, the same 
 as if she had done the act in person. 
 
 The argument of the learned counsel for the defendant that the 
 contract fixed a sum to be paid in case of a violation by the defendant 
 but not in case of a violation "by the other parties," while plausible, 
 is unsound, for there were no "other parties" who could break the 
 covenant. She was the sole covenantor, and unless she kept the cove- 
 nant she broke it; and she did not keep it. As the actual damages 
 for a breach of the covenant would necessarily be "wholly uncertain, 
 and incapable of being ascertained except by conjecture," we think 
 that the parties intended to liquidate them when they provided that the 
 sum named should be "as stipulated damages." The use of the word 
 "penalty" under the circumstances is not controlling. Bagley v. Ped- 
 
Sec. 1) RESTRAINT OF TRADE 12S1 
 
 die, 16 N. Y. 469, 69 Am. Dec. 713; Dakin v. Williams, 17 Wend. 448, 
 affirmed 22 Wend. 201 ; Wooster v. Kisch, 26 Hun, 61. 
 
 As there is no other question that requires discussion, the judgment 
 should be affirmed, with costs. All concur, except Brown J., not sit- 
 ting. 
 
 SAMUEL STORES, Inc., v. ABRAMS. 
 
 (Supreme Court of Errors of Connecticut, 1919. 94 Conn. 248, 108 Atl 541 9 
 
 A. li. R. 1450.) 
 
 Action by the, Samuel Stores, Incorporated, against Aaron H. 
 Abrams. Demurrer to corhplaint sustained, and plaintiff appeals. No 
 error. 
 
 Action for an injunction to restrain the defendant from conducting 
 a clothing business in Bridgeport and from soliciting former and pres- 
 ent customers of the plaintiff to trade with him.^° * * * 
 
 Curtis, J. The plaintiff is a corporation of the state of New York 
 engaged in conducting branch clothing stores in various cities. 
 
 It employed the defendant as manager of one of its branch stores 
 for the period Of one year from September 5, 1918, under the written 
 contract attached to the complaint. 
 
 The contract contains the following stipulation on the part of the 
 defendant : "And, whereas, in the course of such employment, Aaron 
 H. Abrams may be assigned to duties that may give him knowledge 
 and information of confidential matters relating to the conduct and 
 details of the business of the Samuel Stores, Incorporated, as to re- 
 sult in the opinion of the Samuel Stores, Incorporated, irremediable 
 injury to it, for which no money damages could adequately compen- 
 sate, if the said party of the second part should enter the employment 
 of rival concern while this contract was still in effect, the said Aaron 
 H. Abrams agrees not to engage in any other occupation during the 
 life of this contract, and further agrees not to either directly or indi- 
 rectly connect himself with any firm engaged in business similar to 
 that of the party of the first part, which would compete with the busi- 
 ness of the party of the first part, nor will he himself engage in any 
 business that will compete with the business of the party of the first 
 part, for five years after the date of his connection with the party of the 
 first part being severed. The said Aaron H. Abrams agrees to use hisi 
 best endeavors and his entire time to promote the business and business 
 interests of the Samuel Stores, Incorporated." 
 
 The defendant in November, 1918, left the employ of the plaintiff, 
 and on December 9, 1918, opened a store in Bridgeport, and engaged in 
 the business of selling clothing for men, women, and children, and 
 engaged in the same line of business conducted by the plaintiff in 
 Bridgeport, and has , advertised himself as formerly with the People's 
 
 16 Part of the statement is omitted. 
 
3 252 IBLBGAL CONTRACTS (Ch. 9 
 
 Storei the same being tiie trade-name under which the plaintiff has 
 been conducting business in Bridgeport and the defendant has been 
 and is soliciting the customers of the plaintiff to trade with him. 
 
 This case presents the question whether or not the restrictive stipu- 
 lation in the contract between the parties is void as against public 
 policy. 
 
 The public policy to be applied is the public policy of the present 
 time. The changing conditions bf life modify from time to time the 
 reasons for determining whether the public interest requires that a re- 
 strictive stipulation shall be deemed void as against public poli- 
 
 The cases in relation to restraints of trade soon disclosed two lead- 
 ing classes of contracts, contracts between the vendor and vendee of a 
 business and its good will, and, on the other hand, contracts between 
 an employer and an employe. 
 
 Under the law, restrictive stipulations in agreements between em- 
 ployer and employe, are not viewed with the same indulgence as such 
 stipulations between a yendor and vendee of a business and its good 
 will. 
 
 In the latter case, the restrictions add to the value of what the ven- 
 dor wishes to sell, and also add to the value of what the vendee pur- 
 chases. . In such cases also the parties are presumably more nearly on 
 a parity in ability to negotiate than is the case in the negotiation of 
 agreements between employer and employe. 
 
 In a restrictive covenant between a vendor of a business and the 
 vendee, "a large scope for freedom of contract and a correspondingly 
 large restraint of trade" is allowable. In a restrictive covenant be- 
 tween employer and employe on the other hand, there is "small scope 
 for the restraint of the right to labor and trade and a correspondingly 
 small freedom of contract." 
 
 In dealing with a restrictive stipulation between an employer and 
 an employe, as in this case, in order that the court may uphold and 
 enforce the restriction, if it is not otherwise contrary to public policy, 
 the court must find that the facts alleged disclose a restriction on the 
 employe "reasonably necessary for the fair protection of the employ- 
 er's business or rights, and not unreasotmbly restricting the rights of 
 the employe, due regard being had to the interests^ of the public and 
 the circumstances and conditions under which the contract is to be 
 performed." Wm. Rogers Mfg. Co. v. Rogers, 58 Conn. 356, 20 Atl. 
 467, 7 L. R. A. 779, 18 Am. St. Rep. 278; Eureka Uundry Co. v. 
 Long, 35 L. R. A. (N. S.) 119, note; Simms v. Bumette, 16 L. R. A. 
 (N. S.) 389, note; Herbert Morris, Limited, v. Saxelby, [1916] 1 A. 
 C. 688; Mason v. Provident C. & S. Co., [1913] A. C. 724; Norden- 
 feldt V. Maxim H. G. & A. Co., [1894] A. C. 565; Id., 11 Reports, 
 
 1' The court here quoted from Maxim y. Nordenfeldt, 11 The Reports, 27 
 (1895). 
 
Sec. 1) 
 
 RESTRAINT OF TRADE 1253 
 
 27; Konski v. Peet, [1915] 1 Ch. 530;, Herreshofif v. Eoutineau, 17 
 R. I. 3, 19 Atl. 712, 8 L. R. A. 469, 33 Am. St. Rep. 850. 
 
 We are then to determine whether the facts set up in this complaint 
 make it reasonably necessary for the fair protection of the plaintiff's 
 busmess to hold that the restrictive stipulation in the contract should 
 be enforced. 
 
 This stipulation provides, in effect, that the defendant, for five years 
 after he leaves the employ of the plaintiff, shall not either directly or 
 mdirectly connect himself with any firm engaged in business similar 
 to that of the plaintiff, which would compete with the business of the 
 plaintiff, in any city where the plaintiff conducts one of its branch 
 stores. 
 
 It appears from the complaint that the services of the defendant 
 contracted for by the plaintiff are not peculiar or individual in their 
 character, nor purely intellectual, nor are they special or extraordi- 
 nary services or acts. 
 
 The defendant's services and the plaintiff's business are not of a 
 character to involve the acquisition of special business secrets of the 
 plaintiff by the defendant. The agreement relates merely to services 
 in a local retail business, and primarily aims to restrict competition. 
 
 The plaintiff conducts a local retail clothing business in which the 
 defendant was employed as manager. The situation of manager could 
 have been filled by any person of sufficient business capacity. 
 
 The clothing business may be entered upon by any one who desires 
 to enter it, and whether the defendant opened a competitive store or 
 another did so was immaterial to the plaintiff, except that the defend- 
 ant having acquaintance and knowledge of the plaintiff's customers 
 might solicit their trade. 
 
 The restriction in question provides, in substance, that in any city 
 where the plaintiff carries on its business the defendant shall not direct- 
 ly or indirectiy connect himself witli any firm engaged in business sim- 
 ilar to that of the .plaintiff, which would compete with the business of 
 the plaintiff, for five years after his employment with the plaintiff 
 ceases. 
 
 This restriction, binding for that period and relating to every city in 
 which the plaintiff has established a branch store, is not reasonably nec- 
 essary for the fair protection of the plaintiff's business. It covers a 
 number of cities in which the defendant, from his employment in one 
 city, could have had no acquaintance with the local customers. 
 
 A restrictive agreement, providing that the defendant, while connect- 
 ed with a competing business, should not solicit trade from persons 
 who were customers of the plaintiff at the branch store where the de- 
 fendant was employed during his employment, might reasonably be 
 claimed to be such a restriction as is reasonably necessary for the fair 
 •protection of the plaintiff's business. Konski v. Peet, [1915] 1 Ch. 
 530. 
 
1254 ILLEGAL CONTRACTS (Ch. 9 
 
 Such a restriction obviously would not unduly restrict the rights of 
 the defendant, since it would not otherwise restrict the field of his 
 employment than by prohibiting the solicitation of the clothing trade of 
 a limited number of people in one city. 
 
 By the sweeping terms of the restrictive stipulation in question, it 
 is true that the solicitation of such customers of the plaintiff is indi- 
 rectly prevented. But at what cost to the defendant? He is .prohib- 
 ited from entering or being employed in the clothing business in va- 
 rious cities, the number of which may be large, and the area in which 
 he may exercise such experience in and aptitude for that business as 
 he may possess is greatly limited. 
 
 The reasonable and fair protection of the plaintiff's business does 
 not require such an extended restriction of the defendant's field of 
 employment. Public policy requires that the defendant's liberty of 
 action in trading or employment shall not be unduly restricted. To 
 enforce the Sweeping terms of this restriction would be a useless, un- 
 necessary, and undue curtailment of the defendant's liberty of trading 
 and employment, and an unjustified restraint on competition. 
 
 The case at, bar illustrates the following comment found in Herre- 
 shofif v. Boutineau, 17 R. I. 7, 19 Atl. 713, 8 L. R. A. 469, 33 Am. St. 
 Rep. 850: "Covenantees [in contracts in restraint of trade between 
 employer and employe] desiring the maximum protection have, no 
 doubt, a difficult task. When they fail, it is commonly because, likfe 
 the dog in the fable, they grasp too much, and so lose all." 
 
 There is no error. ^^ 
 
 18 Restraints were held invalid in the following cases: Ward v. Byrne, 5 
 M. & W. 548 (1839), coal clerk agreed not to act in coal business anywhere 
 for nine months after leaving; Herbert Morris v. Saxelby, [1916] 1 A. C. 
 688, employee agreed not to engage in same business within United Kingdom 
 for seven years ; service contracts distinguished from sale of good will ; 
 reasonable to protect trade secrets and to prevent solicitation of customers, 
 but not to prevent employee from using his skill and experience as a competi- 
 tor ; Hepworth Mfg. Co. v. Ryott, [1920] 1 Ch. 1, agreement of film actor not 
 to use his film name after leaving plaintiff's employ. 
 
 The restraint was held valid in Styles v. Lyon, 87 Conn. 23, 86 Atl. 564 
 (1913), doctor's assistant agreed not to practice in same town after leaving; 
 Heinz V. National Bank of Commerce of St. Louis, 150 C. C. A. 592, 237 Fed. 
 942 (1916) , bank pr;esident agreed not to go into another bank in the city for 
 one year; Rowe v. Toon, 185 Iowa, 848, 169 N. W. 38 (1918), doctor's prac- 
 tice sold with restraint over one county ; Thorn v. Dinsmoor, 104 Kan. 275, 
 178 Pac. 445 (1919), sale of lawyer's practice; Madson v. Johnson, 164 "Wis. 
 612, 160 N. W. 1085 (1917), sale of doctor's practice. 
 
 Contracts of this kind create restraint on personal liberty ; that is, they 
 destroy certain legal privileges, by creating duties not to do certain things. 
 This process might be carried to such an extreme as to cause peonage or prac- 
 tical slavery, if the contract requires permanent service under one employer. 
 This would be unlawful, and is forbidden by the Thirteenth Amendment to 
 the Constitution. See Shaw v. Fisher (S. C.) 102 S. B. 325 (1920) ; 30 Yale 
 L. Jour. 174. In Trustee of Denny v. Denny, [1919] 1 K. B. 583, it was held 
 that a covenant not to come to London and not to associate with certain 
 named thieves and swindlers was valid, although it might not be if the named 
 persons were honorable men. 
 
'^^*-" ■'■) RESTRAINT OF TEADH 
 
 1255 
 
 GARST V. HARRIS. 
 (Supreme Judicial Court of Massachusetts, 1900. 177 Mass. 72, 58 N. E. 174.) 
 Contract, for breach of the following agreement : 
 "For and in consideration of the per cent deducted from the full 
 retail price, as per list appended hereto, allowed by the Phenyo Caf- 
 fein Company, the vendee or retailer hereby agrees that he will not 
 sell, nor allow any one in his employ to sell, directly or indirectly, 
 Phenyo Caffein, 25 cent size, for less than 25 cents a single box, five 
 boxes for one dollar, twelve boxes for two dollars and twenty-five 
 cents, nor the 10 cent size for less than the face price. 
 
 "The vendee, or retailer, further agrees, that if he violates the terms 
 of this contract, he will pay to the Phenyo Caffein Company the sum 
 of $21, that sum being the agreed amount that the Phenyo CaiTein 
 Company would be damaged by a breach of this agreement. This 
 clause, as to the amount of damages, is inserted because it is recog- 
 nized and agreed that a breach of this agreement would cause the 
 Phenyo Cafifein Company to suffer a material loss, and also that it 
 would be very difficult and usually impossible to prove the exact 
 amount of such loss. 
 
 "The vendee, or retailer, further agrees that the acceptance of said 
 goods, with the notice of the conditions of sale, shall be held to be an 
 assent on his part to the foregoing terms, and an agreement with the 
 Phenyo Caffein Company, to sell subject to the price restrictions 
 fixed by it. 
 
 "This agreement is made subject to the stipulation that in case the 
 vendee, or retailer, should desire to discontinue the sale of Phenyo 
 Cafifein, and notifies the Phenyo Cafifein Company of that fact, in 
 writing, said company agrees to buy 'from the vendee, or retailer, 
 any of the said Phenyo Cafifein at the net cost price at which it was 
 sold to him." 
 
 Then followed a specification of the price and discount to the retail 
 trade. 
 
 The case was submitted to the Superior Court, and, after judgment 
 for the plaintiiif for $21, by Gaskill, J., to this court, on appeal, upon 
 agreed facts, the nature of which appears in the opinion. 
 
 Holmes, C. J. This is an action of contract to recover $21 as 
 liquidated damages for breach of an agreement not to sell Phenyo- 
 Caffein below a stipulated price. Phenyo-Cafifein was a proprietary 
 medicine purchased by the defendant of the plaintifif. At the time of 
 the sale, and as a part of it, a written statement of terms, containing 
 this agreement, was read to the defendant, and delivered to him. One 
 stipulation expressed in the document was that the acceptance of the 
 goods, with the notice of the conditions of the sale, should be an 
 assent to the terms. The defendant accepted the goods, and expressed 
 no dissent. There is no question, therefore, that he agreed to those 
 
1256 ILLEGAL CONTKACTS (Ch. 9 
 
 terms upon the consideration of the sale, which was made with a 
 deduction from the full retail price. The defendant sold the goods so 
 purchased below the stipulated price, and broke his contract, So 
 much of the defendant's argument as denies the agreement, the con- 
 sideration, or the applicability of the contract to the goods sold, needs 
 no further discussion. 
 
 The rest of the defense needs but a few words. It is said that the 
 contract was unlawful, as in restraint of trade. Some limits were set 
 to the inherited doctrine on this subject by the recent case of Electric 
 Co. V. Hawkes, 171 Mass. 101, 50 N. E. 509, 41 L. R. A. 189, 68 Am. 
 St. Rep. 403, as they had been in England before. When, as here, 
 there is a secret composition, which the defendant presumably would 
 have no chance to sell at a profit at all, but for the plaintifif's permis- 
 sion, a limit to the license, in the form of a restriction of the price 
 at which he may sell, is proper enough. See Machine Co. v. Morse, 
 103 Mass. 7Z, 4 Am. Rep. 513; Roller Co. v. Cushman, 143 Mass. 
 353, 9 Y^. E. 629; Gloucester Isinglass & Glue Co. v. Russia Cement 
 Co., 154 Mass. 92, 27 N." E. 1005, 12 L. R. A. 563, 26 Am. St. Rep. 
 214; Fowle v. Park, 131 U. S. 88, 97, 9 Sup. Ct. 658, 33 L. Ed. 67; 
 Walsh v.'Dwig>ht, 40 App. Div. 513, 58 N. Y. Supp. 91. 
 
 It is suggested that the sum agreed upon i'n the writing as liqui- 
 dated damages is a penalty. But it is admitted in the agreed facts 
 that the damages are substantial and difficult to estimate, and it was 
 recognized in the contract that they would be so. It has been decided 
 recently that parties are to be held to their words upon this question, 
 except in exceptional cases, where there are special reasons for a dif- 
 ferent decision. Guerin v. Stacy, 175 Mass. 595, 56 N. E. 892. In 
 this case there is every reason for upholding the general rule. Chase 
 V. Allen, 13 Gray, 42 ; Lynde v. Thompson, 2 Allen, 456. 
 
 Judgment for the plaintiff.^" r 
 
 19 In accord: Grogan v. Chaffee, 156 Cal. 611, 105 Pac. 745, 27 L. R. A. (N. 
 S.) 395 (1909) ; EUiman v. Carrington, [1901] 2 Ch. 275. Of. Dr. Miles 
 Medical Co. v. John D. Park & Sons, 220 TJ. S. 373, 31 Sup. Ct. 376, 55 L. Ed. 
 502 (1911), applying the Sherman Anti-Trust Law of 1890 (U. S. Cotap. St. § 
 8820 et seq.), with vigorous dissent by Mr. Justice Holmes: "I cannot be- 
 lieve that in the long run the public will profit by this court permitting knaves 
 to cut reasonable prices for some ulterior purpose of their own, and thus to 
 impair, if not to destroy, the production and sale of articles which it is 
 assumed to be desirable that the public should be able to get." 
 
Sec. 2) -WAGERIISfG CONTRACTS 1257 
 
 SECTION 2.— WAGERING CONTRACTS 
 
 COLEAMER V. DAY. 
 (Supreme Court of Vermont, 1829. 2 Vt. 144.) 
 
 This was an action of trover, brought up from the County Court 
 for the revision of their decision presented in the following case, 
 agreed to by the parties, to wit : 
 
 "In this action, plaintiff offered to prove, at the trial, that, on the 
 day mentioned in the declaration, the plaintiff and defendant were to- 
 gether in the office of Jacob Collamer, at Royalton — that while there, a 
 gentleman passed in a chaise : when defendant asked, whose chaise is 
 that? Plaintiff answered. Dr. Denison's. Defendant said no, it is 
 not Denison's chaise: I will bet my watch against yours that it is 
 not Denison's chaise — That to this proposal plaintiff agreed— That each 
 of the parties then took out his watch, and laid it upon the table : and 
 it was then mutually agreed by the parties, that they would go together, 
 and ascertain whether the said chaise was the said Denison's chaise; 
 and that, if it was, plaintiff should take both watches; and, if not, de- 
 fendant should take both, as and for his own-^-That they did proceed 
 and examine, and found it to be said Denison's chaise-r-That the parties 
 then returned to the said office, and the defendant immediately took up 
 his watch, and carried it away — That, on the same day, plaintiff de- 
 manded said watch of defendant, who refused to deliver it, but con- 
 verted it to his own use. This evidence was objected to by the defend- 
 ant's counsel, and excluded by the Cpurt. To which decision the 
 plaintiff excepted, and the exception was allowed, and the cause ordered 
 to pass to the Supreme Court. 
 
 Mr. Marsh, for plaintiff, contended. That by the common law, a 
 wager in general, is legal, if it be not an excitement to a breach of the 
 peace, or to immorality; or if it do not a-fifect the feelings or interests 
 of a third person, or expose him to ridicule, or libel him ; or if it be 
 not against sound poUcy; — and that the wager in question could not 
 .lead to any of those consequences. He cited, amohg other authorities, 
 2 T. Rep. 693. — Cowp. 37. The counsel, also, contended, that actual 
 delivery of the property, in this case, was not necessary in order to 
 vest the property in the plaintiff, and to enable him to maintain trover ; 
 and cited Loft, 219.— Cro. Eliz. 866.— 1 T. Rep. 56.-7 id. 9.— 1 Salk. 
 113. — 1 Strange, 165, Atkin vs. Barwick. 
 
 The Court declined hearing Mr. Everett, for the defendant. 
 
 The opinion of the Court was delivered by 
 
 Hutchinson, J, — Nothing appears in this case, but that the action 
 would be maintainable by the common law of England. The common 
 law is adopted by our statute, so far, and so far only, as the same is 
 
12i58 ILLEGAL CONTRACTS (Ch. 9 
 
 applicable to our local situation and circumstances, and is not repug- 
 nant to the constitution, or to any act of the legislature, of this state. 
 Whether applicable, or not, must necessarily be a question of judicial 
 decision: and this is, probably, the first action, that has ever called 
 upon a court in this state to sanction such a contract of betting. The 
 Judges of the Courts in England have expressed their regret, of late 
 years, that such transactions ever received the sanction of a court of 
 justice : but, they yield to the force of the law, which they consider 
 settled by a train of decisions, extending down from remote antiquity. 
 We feel no such embarrassment, nor are we willing to transmit any 
 such embarrassment to our successors; nor diffuse into society the 
 influence of a rule so demoralizing, as would be the sanction of such 
 a contract. It is honorable to this state, that the industrious and 
 moral habits of our citizens have furnished no occasion to litigate 
 questions of this nature. It is honorable to the legislature, that they 
 have interposed checks to such games and sports as they supposed were 
 creeping into use. By the Statute of 1821, page 268, penalties are 
 affixed to the winning or losing, or betting, in money, goods, or chat- 
 tels, on any game, or on any horse-race, or other sport, within this 
 state. And said statute makes void any contracts and securities made 
 and given for money won on such games. The species of betting 
 now in question may not come within that statute, giving it the strict 
 construction of a pena-l statute : yet the good morals of society re- 
 quire, that no encouragement should be afforded to the acquisition 
 of property, otherwise than by honest industry. Time might be occu- 
 pied in seeking occasions to take advantage of the unwary, and acquir- 
 ing a skill to take such advantage, which ought to be devoted to better 
 purposes. 
 
 In this case, according to the terms of the bet, the plaintiff had ac- 
 quired a right to the possession of the watch, which the defendant 
 had laid down in the bet, but the plaintiff had not acquired the actual 
 possession, when the defendant resumed his possession. The plain- 
 tiff, therefore, had no complete right to the watch, without the sanction 
 of such a contract of betting. That sanction is now withheld, and 
 
 The judgment of the County Court is affirmed.^" , 
 
 20 In the IFnited States some courts have followed the English law in hold-, 
 ing wagers legal unless prohibited hy statute, or, for special reasons, promotive 
 of improper results. Campbell v. Richardson, 10 Johns. (N. Y.) 406 (1813).; 
 Trenton Mut. Life & Fire Ins. Co. v. Johnson, 24 N. J. Law, 576 (1854) ; 
 Beadles v. Bless, 27 111. 320, 81 Am. Dec. 231 (1862) ; Henderson v. Stone, 1 
 Mart. N. S. (La.) 639 (1823), wager on horse race; Moore v. Johnston, 8 La, 
 Ann. 488 (1852), same. But the strong tendency is to declare all wagers (save 
 those for commercial objects) contrary to public policy and void. Love v. 
 Harvey, 114 Mass. 80 (1873) ; Bernard v. Taylor, 23 Or. 416, 31 Pac. 968, 18 
 L. R. A. 859, 37 Am. St. Rep. 693 (1893) ; Eldred v. Malloy, 2 Colo. 320, 25 
 Am. Rep. 752 (1874) ; Wilkinson y. Tousley, 16 Minn. 299, (Gil. 263), 10 Am. 
 Rep. 139 (1871) ; Irwin v. Williar, 110 U. S. 499, 4 Sup. Ot. 160, 28 L. Ed. 
 225 (1884). ' ■<'... « . , 
 
 American statutes commonly- make gambling .contracts illegal, as well as 
 void. See Stimson, Am. St; Law, § 4132. By the English statutes, they are 
 
'^^'^•^^ WAGEEING CONTEACTS 1259' 
 
 HAMPDEN V. WALSH. 
 (In the Queen's Bench Division, 1876. 1 Q. B. Dlv. 189.) 
 
 ^cnn j^^"^^' ^" ■^' ^^^^ '® ^" ^^^^°" brought to recover the sum of 
 iSOO deposited by the plaintiff with the defendant, under the' following 
 circumstances : 
 
 The plaintiff, it appears, entertains a strong disbelief in the received 
 opinion as to the convexity of the earth, and with the view, it seems, 
 of establishing his own opinion in the face of the world, he published 
 in a journal called Scientific Opinion, an advertisement in the fol- 
 lovving words : "The undersigned is willing to deposit iSO to £500 on 
 reciprocal terms, and defies all the philosophers, divines, and scientific 
 professors in the united kingdom to prove the rotundity and revolution 
 of the world, from scripture, from reason, or from fact. He will ac- 
 ,knowledge that he has forfeited his deposit if his opponent can ex- 
 hibit to the satisfaction of any intelligent referee a convex railway, 
 canal, or lake." 
 
 The challenge thus thrown out was answered and accepted by a 
 Mr. Alfred Wallace, who offered to stake the like amount "on the un- 
 dertaking to shew visibly, and to measure in feet and inches, the con- 
 vexity of a canal or lake." 
 
 The money was deposited accordingly in a bank, to the credit of 
 Mr. Walsh, the defendant. An agreement was drawn up, whereby it 
 was agreed that, "if Mr. A. R. Wallace, on or before the 15th of 
 March, 1870, proved the convexity or curvature to and fro of the 
 surface of any canal, river, or lake, by actual measurement and 
 demonstration, to the satisfaction of Mr. John Henry Walsh, of 346 
 Strand, and of Mr. W. Carpenter, of 7 Carlton Terrace, IvCwisham 
 Park, or, if they differed, to the Satisfaction of the umpire they 
 might appoint," Wallace was to receive the two sums deposited; while 
 if Wallace failed in shewing such actual proof of convexity, the two 
 sums were to be paid to the plaintiff. The agreement concluded- with 
 the following proviso: "Provided always, that, if no decision can be 
 arrived at, owing to the death of either of the parties, the wager is 
 to be annulled ; or if, owing to the weather being so bad as to prevent 
 a man being distinctly seen by a good telescope, at a distance of four 
 
 void only. For the effect of this, see Hyams v. King, [1908] 2- K. B. 696 ; 
 Thacker v. Hardy, 4 Q. B. D. 685 (1878), 
 
 It is not illegal to lend money to pay a gambling debt, Pennsylvania R. Co. 
 V. Eosenfeld, 249 Fed. 964, 162 C. C. A. 162 (1918) ; or to lend money with 
 knowledge that the borrower will gamble with it, Tyler v. Carlisle, 79 Me. 
 210, 9 Atl. 356, 1 Am. St. Rep. 301 (1887) ; but otherwise, if lent with the 
 purpose that it shall be so used. McKinnell v. Robinson, 3 M. & W. 434 (1838). 
 
 Many aleatory commercial contracts (e. g., insurance) are not illegal wa- 
 gers. Nor is a contract a wager because the sum to be paid will increase in 
 amount in an uncertain event, where the event affects the value of the con- 
 sideration. Ferguson v. Coleman, 3 Rich. (S. C.) 99, 45 Am. Dec. 761 (1846) ; 
 Gray t. Gardner, 17 Mass. 188 (1821). 
 
1260 ILLEGAL CONTRACTS (Ch. 9 
 
 miles, then a further period of one month is to be allowed for the ex- 
 periment, or longer, as may be agreed upon by the referees." 
 
 Mr. Walsh being unable to act as referee, a Mr. Coulcher was 
 substituted for him. Certain tests having been agreed on, the experi- 
 ment was tried on the Bedford Level Canal. The referees differed; 
 Mr. Coulcher being of opinion that Mr. Wallace had proved, Mr. 
 Carpenter, that he had not proved, the convexity of the canal. There- 
 upon it was proposed that the referees should exercise their power 
 of appointing an umpire; but Mr. Carpenter declined to act further 
 in the matter. A correspondence ensued, when it was agreed to leave 
 the matter to the decision of Mr. Walsh, the present defendant, to 
 whom the two referees should submit their reports, and who was to 
 be at liberty to seek any further information he might deem neces- 
 sary, and to consult Mr. Solomons, an optician, if he thought proper. 
 Having done so, he decided in favour of Mr. Wallace, as having 
 ■"proved to his satisfaction the curvature to and fro of the Bedford 
 Level Canal between Witney Bridge and Welsh's Dam (six miles), 
 to the extent of five feet more or less." 
 
 To this decision the plaintiff objected, and before the defendant 
 had paid over the money to Mr. Wallace, demanded to have the £500 
 he had deposited restored to him. Notwithstanding which, the de- 
 fendant paid the two sums of £500 to Wallace. 
 
 The question for our decision is, whether upon this state of facts 
 the plaintiff is entitled to recover the sum so deposited by him. 
 
 One question which presents itself is, whether this agreement 
 amounts in effect to a wager; and if so, whether the plaintiff by 
 the effect of 8 & 9 Vict. c. 109, § 18, is prevented from maintaining 
 this action. 
 
 We will, in the first instance, proceed with the case on the assump- 
 tion that the agreement is in effect a wager. 
 
 It is well established by numerous authorities, which it would be 
 here superfluous to cite, that at common law, a wager, being a con- 
 tract by A. to pay money to B. on the happening of a given event, 
 in consideration of B. paying money to him on the event not happen- 
 ing, was legal, provided the subject-matter of the wager was one 
 upon which a contract could lawfully be entered on. But by the ef- 
 fect of the statutes of 16 Car. II, c. 7, of 9 Anne, c. 14, and of other 
 statutes for the prevention of gaming, various forms of betting became 
 stamped with illegality, and no action could be maintained by the 
 winner against the loser in respect of them. Nor could any action be 
 brought by the winner against the stakeholder with whom the amount 
 of the wager had been deposited. Wagers not included in these statutes 
 remained as before, and could be made the subject-matter of an action, 
 although judges sometimes refused to try such actions, especially where 
 the subject-matter of the wager was of a low or frivolous character, as 
 unworthy to occupy the time of a court of justice. 
 
 As the law now stands, since the passing of 8 & 9 Vict, c 109, there 
 
w.. 
 
 Sec. 2) 
 
 WAGEEING CONTRACTS 1261 
 
 is no longer, as regards actions, any distinction between one class of 
 wagers and another, all wagers being made null and void at law by 
 that statute. 
 
 But though, where a wager was illegal, no action could be brdu&bt 
 either against the loser or stakeholder by the winner, a party who 
 had deposited his money with the stakeholder was not in the same 
 predicament. If, indeed, the event on which the wager depended had 
 come off, and the money had been paid over, the authority to pay 
 It not having been revoked, the depositor could no longer claim to 
 have it back. But if, before the money was so paid over, the party 
 depositing repudiated the wager and demanded his money back, he 
 was entitled to have it restored to him, and could maintain an action 
 to recover it; and this, not only where, as in Hodson v. Terrill, 1 Cr. 
 & M. 797, notice had been given to the stakeholder prior to the event 
 being determined, but also, where, as in Hastelow v. Jackson, 8 B. 
 & C. 221, notice was given after the event had come off. 
 
 In Hodson v. Terrill, 1 Cr. & M. 797, the deposit had been made 
 on a cricket match for £20 a side, and was therefore unlawful within 
 the statute of Anne. A dispute having arisen in the course of the 
 match, and one side having refused to play it out, the plaintiff, who 
 had paid a deposit, claimed to have it returned, and it was held 'that 
 he was entitled to recover. 
 
 So in Martin v. Hewson, 10 Ex. 737, 24 I^. J. (Ex.) 174, in an action 
 for money had and received to plaintiff's use, the defendant having 
 pleaded that the money had been deposited with him to abide the 
 event of a cockfight, the replication, that before the result was as- 
 certained the plaintiff repudiated the wager, and required repayment 
 of the deposit, was held good. In Hastelow v. Jackson, 8 B. & C. 
 221, the Court of Queen's Bench, following the prior cases of Cotton 
 V. Thurland, 5 T. R. 405, Smith v. Bickmore, 4 Taunt. 474, and Bate 
 V. Cartwright, 7 Price, 540, held that, where, money having been de- 
 posited with the stakeholder to abide the event of a boxing match, 
 A., the depositor, claimed the whole sum from^ the stakeholder, as 
 having won the fight, and threatened him with an action if he paid it 
 over to B., the- other combatant, which he nevertheless did by direc- 
 tion of the umpire, A. was entitled to recover the money he had de- 
 posited as his own stake as money had and received to his use. "If," 
 says Bayley, Ji, "a stakeholder, pays over the money without au- 
 thority from the party and in opposition to his desire, he does so at 
 his own peril." These cases have never been overruled, and must be 
 con.sidered as law ; although in Meaning v. Hellings, 14 M. & W. at 
 page 712, Al.derson, B., speaks doubtingly of the decision in Hastelow 
 v. Jacksoii, 8 B. & C. 221, using the expression, "that case does not 
 convince me, it overcomes me." But that case seems to have been 
 decided more on the form of the particulars than anything else, and 
 does not seriously interfere with the authority of Hastelow v. Jack- 
 son, 8 B. & C. 221, which seems to us to be good law. 
 
1262 ILLEGAL CONTRACTS (Ch. 9 
 
 A distinction has, however, been taken .between cases in which the 
 deposit was made to abfde the event of an illegal , wager, and others, 
 in which the wager, not being prohibited by statute, or of an improper 
 character, was legdly binding. In the former cases, the contract 
 between the principals being null and void, the mopey remains in the 
 hands of the stakeholder devoid of any trust in respect of the other 
 party, and in trust only for the party depositing, who can at any time 
 claim it back before it has been paid over. In, the latter, the contract, 
 prior to 8 & 9 Vict. c. 109, § 18, not being invalid, it was open to 
 contention that money deposited on the wager with a stakeholder 
 must remain with the latter to abide the event. 
 
 Greater difficulty, therefore, presented itself where, prior to 8 & 9 
 Vict. c. 109, § 18, money was deposite,d on a wager not illegal; and 
 the Courts of King's Bench and Exchequer were at variance on this 
 point. In Eltham v. Kingsman, 1 B. & Aid. 683, the Court of King's 
 Bench, consisting of Lord Ellenborough, C. J., Bayley, Abbott, and 
 Holroyd, JJ., held, that even where a wager was legal, the authority 
 of a stakeholder, who was also (as is the case with the present de- 
 fendant) to decide between the parties, might be revoked and the 
 deposit demanded back. "Here," says L,ord Ellenborough, "before 
 there has been a decision the party has countermanded the authority 
 of the stakeholder." "A man," says Abbott, J., "whp has made a 
 foolish wager may rescind it before any decision has taken place." 
 In the later case of Emery v. Richards, 14 M. & W. 728, the Court of 
 Exchequer, where money had been deposited on a wager of less 
 than £10 on a foot race, and therefore, prior to the passing of the 
 statute 8 & 9 Vict., not illegal under the then existing statute, held 
 that the plaintiff could not demand to have his stake returned, but 
 must abide the event. The case of Eltham v. Kingsman, 1 B. & Aid. 
 683, does not, however, appear to have been brought to the notice of 
 the Court, and in our view the decision of this Court was the sounder 
 one. We cannot concur in what is said in Chitty on Contracts (8th 
 Ed.) p. 574, that "a stakeholder is the agent of both parties, or rather 
 their trustee." It may be true that he is the trustee of both parties 
 in a certain sense, so that, if the event comes off and the authority 
 to pay over the money by the depositor be not revoked, he may be 
 bound to pay it over. But primarily he is the agent of the depositor, 
 and can deal with the money deposited so long only as his authority 
 subsists. Such was evidently the view taken of the position of a stake- 
 holder by this court in the two cases of Eltham^ v. Kingsman, 1 B. & 
 Aid. 683, and Hastelow v. Jackson, 8 B. & C. 221 ; and in that view 
 we concur. 
 
 Practically, however, it is now unnecessary to decide this question, 
 if the transaction under consideration is to be looked upon as a wager. 
 For by 8 & 9 Vict. c. 109, § 18, it is enacted "that all contracts or agree- 
 ments, whether by parol or in writing, by way of gaming or wagering, 
 shall be null and void; and that no suit shall be brought or main- 
 
Sec. 2) WAGERING CONTRACTS 1263 
 
 tained in any court of law or equity for recovering' any sum of money 
 or valuable thing alleged to be won upon any wager, or which shall 
 have been deposited in the hands of any person to abide the event 
 on which any wager shall have been made." 
 
 The present wager, though previously lawful, being thus rendered 
 null and void, it follows that the plaintiff must be entitled to recover 
 his deposit, unless that part of the enactment which provides that, 
 "no suit shall be brought or maintained in any court for recovering 
 any sum of money which shall have been deposited in the hands of 
 any person to abide the event on which any wager shall have been 
 made," affords an answer to the action — a question on which a differ- 
 ence of opinion exists. The question arose in Varney v. Hickman, 5 
 C. B. 271, 17 L. J. (C. P.) 102. The plaintiff and one Isaacs had de- 
 posited £20 each with the defendant on the event of a match between 
 two horses. Before the race was run the plaintiff gave notice to the 
 defendant that he dedined the bet and demanded back his deposit. 
 The plaintiff not attending to contest the race, Isaacs was declared 
 the winner, and the amount of the two deposits was handed over 
 to him by the defendant. An action for money had and received 
 having been brought by the plaintiff to recover the amount of his de- 
 posit, the statute 8 & 9 Vict. c. 109, § 18, was relied upon for the 
 defence. But it was held by the Court, consisting of Maule, Cress- 
 well, and Williams, ]]., that the part of section 18 relating to deposits 
 was meant to apply only to the nonrecovery by the winner of a sum 
 deposited by the other party to abide the event, and not to the right 
 of the depositor to recover back his deposit, if demanded before the 
 money was paid over. 
 
 In the later case of Martin v. Hewson, 10 Ex. 737, 24 L. J; (Ex.) 
 174, already referred to, the Court of Exchequer adopted the view of 
 the Common Pleas in Varney v. Hickman, 5 C. B. 271, 17 E. J. (C. 
 P.) 102, Parke, B., saying: "According to the context, the statute 
 prohibits the recovery of money which has been won in such a trans- 
 action, or has been deposited to abide the event of a wager, but it 
 does not apply to the case where a party seeks to recover his stake 
 upon a repudiation of the wagering contract." 
 
 But in Savage V. Madder, 36 L. J. (Ex.) 178, Martin, B., expressed 
 a decided opinion that no action could be brought, either directly 
 upon the contract, or in respect of money deposited by the winner 
 himself in the hands of a stakeholder to abide the event. "It is," 
 said the learned judge, "in fact, expressly within the Act of Parlia- 
 ment; and more than that, it is within what the Act intended to ef- 
 fect 'The object of the Act was to prevent trials in courts of law 
 with respect to betting contracts ; and rightly so, for they are con- 
 tracts in relation to transactions with which the time of the courts of 
 law ought not to be occupied. A man who makes bets must take 
 his chance of getting his money. A bet ought to be a contract of 
 honour • and if the loser cannot pay, no action should be mamtam- 
 
1264; ILLEGAL CQNTEACTS (Ch, 9 
 
 able in respectof the debt." What was thus said was, however, uji- 
 tlecessaty to the decision of the question before the Court; For the 
 plaintiff there elaimed the entire stakes as his by the event; he had 
 never repudiated the wager or revoked the authority of the stake- 
 holder. He -was seeking to enforce the wager, and was met by the 
 statute and defeated by the effect of the enactment. The question 
 again arose directly in the case of Graham v. Thompson, Ir. Rep, 2 
 C. L. 64, in the Court of Common Pleas in Ireland, where, m an 
 action for money had and received, the defendant pleaded specially, 
 "that the money was money deposited in the hands of the defendant 
 to abide an event on which a wager had thereupon been made, to wit, 
 &c., and that that wager had not been repudiated, or any demand 
 of the said money, or any part thereof, made upon him by the plain- 
 tiff before the event on which the said wager had been made had 
 taken place, and the said wager had been decided." The plaintiff 
 demurred to this defence, on the ground that it was consistent with 
 it that the plaintiff had repudiated the wager before the defendant had 
 paid over the money to the winner. And the Court, taking the same 
 view as had been taken in Varney v. Hickman, 5 C. B. 271, 17 L. J. 
 (Ex.) 174, and Martin v. Hewson, 10 Ex. 737, 24 L. J. (Ex.) 174, 
 held the demiurrer good. It is unnecessary to say what our view 
 might have been had the matter been res Integra; we are bound by 
 the authority of these decisions, which, if they are to be reviewed, 
 can only be reviewed in a court of appeal. 
 
 Thus far we have dealt with the agreement between the parties as 
 a wager. But it was contended before us, on the argument, ^ that 
 this was not a wager, but an agreement entered into for the purpose 
 of trying by experiment a question of science. We think this posi- 
 tion altogether untenable. The agreement has all the essential char- 
 acteristics of a wager. Each party stakes his money on an event to be 
 ascertained, and he in whose favour the event turns out is to take 
 the whole. The object of the plaintiff in offering the challenge he 
 gave was not to ascertain a scientific fact, but to establish his own 
 view in a marked and triumphant manner. To use a common phrase, 
 his object was to back his own opinion. No part of the money staked 
 was to go to the party by whom the experiment was to be made. 
 Lastly, the parties themselves in the written agreement have spoken 
 of it, in terms, as a "wager." We can have no hesitation in holding it 
 to be such. 
 
 But even if our view of the agreement were such as was suggested 
 by the defendant's counsel, our decision would be the same, as the 
 principle of the decision of the Court in the cases of Eltham v. Kings- 
 man, 1 B. & Aid. 683, and Hastelow v. Jackson, 8 B. & C. 221, before 
 cited, would appear to us to apply; according to which we should 
 look upoii the defendant merely as the agent of the plaintiff, and as 
 no longer justified in paying over the money when once his authority 
 had been countermanded. 
 
Sec. Z) WAGERING CONTKACTS 1265 
 
 But as we hold the agreement to have been a wager, and conse- 
 quently that the case is concluded by the authorities we have re- 
 ferred to, it is unnecessary to decide this point. 
 
 Our judgment will therefore be for the plaintiff. 
 
 Judgment for the plaintiff. 
 
 In re GREEN. 
 
 (District Court of the TJnited States, W. D. Wisconsin, 1877. 7 Biss. 338, 
 
 Fed. Cas. No. 5751.) 
 
 Hopkins, District Judge. Richard Green proved a claim of $7,715.- 
 16 against the bankrupt's estate, and James Norris of $1,877.23. The 
 assignee moves to expunge Norris' claim and to reduce Green's. The 
 grounds upon which the motion is made are, that the contracts upon 
 which the claims are based were void, first, by the statute of frauds, 
 and second, that they were gaming contracts. In the view I have taken 
 of the case, it is only necessary to consider the latter. 
 
 There has been considerable testimony taken, and it is in some re- 
 spects quite contradictory, but I think the conflict is more apparent 
 than real. The proof shows that the part of the claim, of Richard 
 Green which is, objected to, and all of Norris' claim, arose out of losses 
 on wheat contracts, and it is claimed that no wheat was in fact bought 
 or intended to be bought, but the transactions were only purchases of 
 options — ^wagers on the price of wheat at a future day, and void under 
 the statute of this state on the subject of betting and gaming. 2 
 Taylor's Statutes, p. 1881, § 16. If the contract for the purchase and 
 sale of wheat was only colorable and neither party intended to deliver 
 or a:ecept the wheat, but only to pay differences according to the rise 
 and fall of the market price, it would be a gaming contract and 
 void. The form of the contract would not be conclusive. Courts 
 would look into the matter and determine whether the parties really 
 meant to purchase and sell, or whether the transaction was but a mere 
 bet upon the future price of the article. This must be determined by 
 the evidence and circumstances attending the making of the contract 
 and the conduct of the parties in reference to it. The form of the 
 contract would not control or be very material if the transaction itself 
 was illegal. Cave's 7th Ed. Addison on Contracts, page 209; Picker- 
 ing V. Cease, 8 Chicago .Legal News, 340; Kirkpatrick v..Bonsall, 72 
 Pa. 155;'Cassard v. Hinman, 14 N. Y. Super. Ct. 107; Grizewood v. 
 Blane, 73 E. C. h. 526; Rourke v. Short, 25 L. J., Q. B. 196; Enderby 
 V. Gilpin, 5 Moore, 571. 
 
 The court in 72 Pa. 155, after stating that gambling must not be 
 confounded with mercantile speculation, for that is proper, says, "mer- 
 chants speculate upon the future price of articles in v/hich they deal, 
 and buy and sell accordingly. They forecast the future and buy and 
 sell, in a bona fide way, which is unobjectionable. But," (the court 
 
 CORBIN CONT 80 
 
1266 ILLEGAL CONTRACTS (Ch. 9 
 
 says) "when ventures are made upon the turn of price only, with no 
 bona fide intent to deal in the article, but merely to risk the difference 
 between the rise and fall at a future time, the case is changed. No 
 money or capital is invested in the purchase, but so much only is re- 
 quired as will cover the difference or margin as it is figuratively termed. 
 The bargain represents not a transfer of property but a mere stake or 
 wager upon its future price. * * * Such transactions are destruc- 
 tive of good morals and fair dealings, and of the best interests of the 
 community." 
 
 Against such transactions the statute is aimed, and when they are 
 proven, the parties must in this state be left without remedy. They are 
 unlawful and void as contravening a sound public policy as well as the 
 statute of the state. 
 
 Our statute has gone further than the English statutes on this ques- 
 tion; ours makes void all agreements and contracts to pay money lost 
 on ,a wager either to the party winning or to a party who advances it to 
 aid in the enterprise. It is unlawful to bet and equally so to lend mioney 
 for that purpose. No cause of action arises in favor of a party to an 
 illegal transaction nor will the law lend its aid to enforce any contract 
 which is in conflict with the terms of a statute or a sound public policy 
 or good morals. Ruckman v. Bryan, 3 Denio (N. Y.) 340; Armstrong 
 V. Toler, 11 Wheat. 258, 6 L. Ed. 468; Hooker v. Knab, 26 Wis. 511. 
 
 It has also been held that where a stake-holder pays over the money 
 to a winner by the direction of the loser after the bet is decided that it 
 will not prevent a recovery back of him by the loser. Ruckman v. 
 Pitcher, 1 N. Y. 392. [It is sometimes so provided by statute.] 
 
 Having ascertained the law applicable to such transactions, the 
 question recurs upon the evidence: Did the bankrupt intend or mean 
 to deal in the property, or only pay the difference in price at a future 
 day? If the latter, the contract within the decisions above referred to 
 is void. 
 
 It is insisted that both the claimants acted as agents only for the 
 bankrupt in buying, and were not the parties selling, so that, conceding 
 the rule of law to be as above stated, they do not fall within it; that 
 they paid the money to the parties selling to the bankrupt, and al- 
 though the purchase was made through them as agents of the bankrupt 
 in the usual way of trade, and with knowledge of the illegal nature of 
 the contract, still the bankrupt is liable to them for money paid to third 
 parties for the differences, and that it is in the nature of a claim for 
 money paid at his request, and it is not within the prohibition of the 
 act. Reliance was placed upon the case of Rosewarne v. Billing, 109 
 E. C. L. 316, to sustain this claim. That was an action by a broker to 
 recover of his principal money paid by him for differences on illegal 
 contracts for the purchase of shares of railroad stock made by the 
 broker for the principal. The court say that no action could be main- 
 tained to recover the differences on such time contracts, but that when 
 
Sec. 2) WAGERING CONTRACTS 1267 
 
 such losses were paid by a party at the request of the defendant, such 
 party could recover. • The court hold that such contracts are void, but 
 not illegal, and not being illegal, a party paying at the request of the 
 defendant could recover. But this is not the doctrine of the courts of 
 this counti-y. They hold them to be illegal ; they say they are unlaw- 
 ful as in conilict with sound morals and public policy as well as in- 
 hibited by the statute. But this is not all. Our statute is broader than 
 the English statute. The statute of this state declares all contracts, 
 notes or agreements for reim;bursing or repaying any money knowing- 
 ly advanced for any betting or gaming at the time or place of the 
 gaming or betting to be void. These parties, it seems to me, fall within 
 that statute. They advanced the margins at the time to make the gam- 
 ing contract, and without their aid in that respect the contracts would 
 not have been made. So if these contracts are gaming contracts, they 
 must be held to have advanced the money for margins to make them, 
 and their claim for repayment falls within the prohibited class mention- 
 ed in the act. They made the illegal contracts and advanced the money 
 required to, give them colorable validity. To take their case out of the 
 statute yvQuld be establishing a most flagrant eyasion of its provisions. 
 
 If the hankrupt had requested a party to pay the difference for him 
 after the loss, and such party had not been an actor, nor aided or as- 
 sisted in the unlawful dealings qut of which the loss grew, there would 
 be some reason in allowing him to recover. He would be an innocent 
 party. Jessup v.' Lutwyche, 10 Ex. 614. In such a case the consid- 
 eration would not, as to him be illegal ; he would not be chargeable 
 with the act declared to be illegal. But here the statute, as before 
 stated, declares all promises or notes to repay money advanced at the 
 time and place, void. The money here was advanced at the time and 
 place. The contracts of purchase were in the names of these claim- 
 ants. Their claims are not for money loaned to bankrupt to pay dif- 
 ferences, but for money paid by them for differences and for which 
 the bankrupt was not hable. 
 
 The case of Steers v. Lashley, 6 T. R. 61, very closely resembles 
 this. That was an action on a bill of exchange by an indorsee with 
 knowledge of the considefation. In that case the defendant had en- 
 gaged in several stock jobbing transactions in which Wilson was em- 
 ployed as his broker, and had paid the differences. Wilson drew the 
 bill for a part of those differences, which defendant accepted; it was 
 then indorsed to the plaintiff but with knowledge of the facts. Lord 
 Kenyon, before whom the case was tried, ordered nonsuit. A motion 
 to set it aside was made on the ground that as the broker had paid 
 the difference for his employer, which was the consideration, the bill 
 was not vitiated by the original transaction, citing Faikney v. Renous, 
 3 T R 418, and Petrie v. Hanney, 4 Burr. 2609. Lord Kenyon de- 
 nied the motion, and said that in the cases referred to, the money had 
 been loaned to pay the difference, and afterwards the securities were 
 g'vTn for the money so loaned. "But here (he said) the bill on which 
 
1268 ILLEGAL CONTRACTS (Ch. 9 
 
 the action is brought, was given for the very diflferences which Wil- 
 son could not enforce payment of himself," and as the plaintiff took the 
 bill with knowledge he occupies no better position. 
 
 If the law was correctly stated in that case, it settles the question 
 that a broker who transacts the illegal business, and pays the differ- 
 ences, cannot recover of the principal the money thus paid ; a propo- 
 sition so clear to my mind that it would hardly seem necessary to 
 quote authority to sustain it. But, plain as it appears, the case of 
 Rosewame v. Billing, supra, cited by the claimant's counsel, seems 
 to sanction a different doctrine. But I do not think that case can be 
 regarded as the law upon this point in England. There are cases in 
 conflict with it, so I think it may be safely asserted that the weight of 
 English authorities is with Steers v. Eashley, supra. 
 
 If transactions like these are illegal I know of no reason why the 
 broker should be favored, or exempted from the usual consequences 
 that attach to other parties aiding or assisting in the commission of 
 unlawful acts. It makes their business quite hazardous, but that grows 
 out of its illegal character. They can refuse to aid in transactions 
 of such a character, and if they would do so, a great deal of that kind 
 of gambling would stop. Parties like this bankrupt living in the coun- 
 try without means or privileges upon the exchange boards could not 
 embark in such gambling business without their aid. Through bro- 
 kers and commission men they get access to the exchange boards, and 
 by reason of such facilities are enabled to engage in these gaming con- 
 tracts which generally end like this in ruin and bankruptcy. 
 
 To their complaint of hardship it is a sufficient answer that they 
 should not aid and assist parties in transactions condemned both by 
 the law and the principles of sound morality. If they do, they must 
 take the consequences like other transgressors. 
 
 Having ascertained that contracts of sale that do not contemplate 
 the actual bona fide delivery of the property by the seller nor the pay- 
 ment by the buyer, but are intended to be settled by paying the differ- 
 ence in price at some future time, are held to be gambling contracts 
 and that the broker stands in no better position than the seller to re- 
 cover differences, it only remains to examine the testimony and see 
 whether the contracts in this case were such. And upon this point I do 
 not intend to go over the testimony in detail. It is self-evident from 
 the testimony and the condition of the parties that these sales were 
 not bona fide. The bankrupt was not a dealer in grain. He was 
 a country merchant of little or no means; had no money to invest in 
 wheat, that is to pay for wheat, which fact both Richard Green, his 
 brother, and Norris knew. The idea that they bought for him sev- 
 eral thousand bushels of wheat with the expectation that he was to 
 pay for it is preposterous. He swears they did not and it is appar- 
 ent that he could not^ arid they knew it. 
 
 He did not put up any money even for margins, or but a small 
 amount, if any, and made no arrangements with them to do so. Nor- 
 
^) WAGERING CONTRACTS 1269 
 
 SvT.v\' ^^T ^^" • °"?* ^°' ^^ '"' t^"^ fi^'" "^""e. That prob- 
 tW Zr T '"i"^ ^^ 'T^ *^* ^^^"^ ^^ "^^d "on change," but- 
 
 tiiat there was a bona fide purchase, with the intention that he ;ould 
 take and pay for such large quantities of wheat I do not believe The 
 purchase it is claimed was made in the name of Norris &' Spencer the 
 brokers not the bankrupt's, and that they had a number of contacts 
 and perhaps some warehouse receipts for grain is quite probable, and 
 tiiat they might have considered such contracts as the property of the 
 bankrupt, and charged the wheat to him on their books on receiving 
 his order to buy, so as to make a colorable sale, is not improbable, but 
 that they expected payment for the whole, the testimony completely 
 negatives The fact that the parties charged the bankrupt with the 
 price 9f the grain when he ordered it purchased and credited him with 
 the price sold for, when sold, does not prove what the real transaction 
 was. That only represents the form, not the nature of the transaction. 
 It was as well to keep the account in that way when the real intention 
 was to speculate in and pay only the differences as, when the sale was 
 of the article itself. The books would show the differences if it was 
 to pay them, and the profit or loss if it was a genuine sale. The books 
 were properly kept in either case, and do not therefore furnish any 
 evidence as to what the contract was. 
 
 But it is said that the bankrupt settled with Norris, and gave him 
 notes, and that these notes are good, if the account was not. 
 
 That is not so. If there was no legal liability on the part of the 
 bankrupt to pay the claim, the notes given therefor are void for want 
 of consideration. This point is expressly ruled by the Supreme Court 
 in Hooker v. Knab, 26 Wis. 511. See also Steers v. Lashley, 6 T. R. 
 61, supra. The question whether the bankrupt could have defended 
 on this ground as against a bona fide holder of the notes, does not 
 arise here, as the original parties are alone before the court. The 
 claim of Norris is therefore invalid, and his proof is rejected. 
 
 As to Richard Green's claim, the pretended contracts of purchase 
 were made in his name, and not in the name of the bankrupt, and the 
 testimony shows that as between thenj, all that either ever contemplat- 
 ed was the payment of differences. Under the evidence this is too plain 
 to admit of question or discussion. His claim so far as such differ- 
 ences on grain contracts, are included, is disallowed and the proof is 
 rejectCid. But as there are some other items of account that are prop- 
 er and should be allowed, it will be referred to the Register to take 
 and admit proof of such other items. 
 
 The motion of the assignee to expunge the proof of such parties is 
 therefore granted.^^ 
 
 21 Wagers on the future price of a commodity, where the understanding is 
 that no delivery is to be made but that there shall be a mere "settlement of 
 differences," are illegal. Raymond v. Parker, 84 Conn. 694, 81 Atl. 1030 
 (1911) ; Lamson Bros. & Co. v. Bane, 206 Fed. 253, 124 O. C. A. 121, 46 L. 
 K. A. (N. S.) 650 (1913) ; Mohr v. Miesen, 47 Minn. 228, 49 N. W. 862 (1891) : 
 
1270 ILLEGAL CONTRACTS (Ch. 9 
 
 ZEMBLEtR V. FITZGERALD. 
 (Supreme Judicial Court of Massachusetts, 1919: 234 Mass. 236, 125 N. B. 299.) 
 
 Action by Louis Zembler against William F. Fitzgerald and others. 
 Resulting in judgment for defendants on plaintiff's motion f of judg- 
 ment on the auditor's report. On report to the Supreme Judicial 
 Court. Judgment for defendants. 
 
 Carroll, J.^^ The plaintiff employed the defendants, who are stock 
 brokers, to buy and sell stock on margin. The contract was made 
 February 23, 1916, when the plaintiff deposited $2,000, and received 
 from the defendants a receipt "subject to marginal conditions hereon," 
 to the effect that the amount received was to be used by the defend- 
 ants as margin or collateral security to protect them from losses in 
 their transactions with the plaintiff, and that they were authorized to 
 sell all the stocks, bonds or other property held by them for the plain- 
 tiff's account, at private or public sale, if the amount paid were insuffi- 
 cient to protect them from loss. In the superior court the case was 
 heard on the auditor's report. Judgment was ordered for the defend- 
 ants and the case reported to the Supreme Judicial Court. , 
 
 Between February 23, 1916, and February 16, 1917, the plaintiff or- 
 dered the defendants to sell or purchase for his account shares of 
 stock of different corporations. In October of 1917 the defendants, 
 at the plaintiff's request, delivered to F. H. Milliken & Co. 20 shares 
 of Alaska, 20 shares of Isle Royal, 30 shares Massachusetts Consoli- 
 dated, 30 shares of North Butte and 20 shares of Utah Consolidated 
 (which were all the securities then held for the plaintiff's account), 
 and received from F. H. Milliken & Co. the amount of the plaintiff's 
 indebtedness. At no other time did the defendants deliver or tender 
 to the plaintiff or his agent the stocks purchased by them in accord- 
 ance with his order. 
 
 When an order was given to buy or sell, the defendaiits mailed to 
 the plaintiff a bought or sold slip confirming the transaction. On each 
 of the sale slips there was printed "All orders for the purchase or sale 
 of any security are received and executed with the distinct under- 
 
 Harvey v. Merrill, 150 Mass. 1, 22 N. B. 49, 5 L. K. A. 200, 15 Am. St. Kep. 
 159 (1889). 
 
 "That a contract of sale may be made for the future delivery of produce, 
 or any article of personal property, will not be controverted ; and that such 
 a contract, by the agreement of parties, or by the regulations connected with 
 the boards of trade in the country, may be transferable from one to the other, 
 will be conceded ; but when entered into for the sole purpose of speculating in 
 futures, and with no intention to deliver the cotton purchased, but to pay the 
 difference between the contract price of the cotton and its market price on 
 the day, if a contract in good faith, the cotton was to be delivered, then the 
 contract becomes a mere wager, and neither party to it can recover." Beadles 
 v. McBlrath, 85 Ky. 230, 3 S. W. 152 (1887) . For an ineffective statute against 
 "option" contracts, see Stewart v. Dodson, 282 111. 192, 118 N. E. 405, 1 A. L. 
 R. 1544 (1917). 
 
 2 2 Part of the opinion is omitted. 
 
Sec. 2) 
 
 WAGERING CONTRACTS 1271 
 
 Standing that an actual purchase or sale is contemplated, and that you 
 so understand and agree," and "in the event of your not making de- 
 livery of the securities sold, in time for us to comply with the rule 
 for delivery of securities in the exchange in which the same have been 
 sold, we are hereby em.powered to make delivery of the same for 
 your account, the said securities to be loaned by us to you for the fore- 
 going purpose and to be returned to us on demand." Upon each of 
 the slips confirming purchases there appeared the printed statement 
 that "all ordfers for the purchase or sale of any security are received 
 and executed with the distinct understanding that an actual purchase 
 or sale is contemplated," and the further statement, "It is agreed that 
 all securities from time to time carried in your marginal account, or 
 deposited to .protect the same, may be loaned or may be pledged by 
 us, either separately or together with other securities, either for the 
 sum due thereon or for a greater sum, all without further notice to 
 you." On the 1st of each month, beginning April 1, 1916, the defend- 
 ants sent to the plaintiff a statement of his account, showing purchases 
 and sales, with the prices, amounts, interest charges and ' balances. 
 The plaintiff" admitted that he read all the printed matter appearing 
 upon the confirmation slips and agreed to all the recitals contained 
 therein. 
 
 On April 25, 1916, the plaintiff gave an order to sell 40 shares of 
 Butte & Superior. None of this stock was then held by the defend- 
 ants for his account. iTie following day he gave an order to buy 40 
 shares. This was to protect the order to sell, the plaintiff admitting 
 that the stock bought was to replace that sold. November 27, 1916, 
 he ordered the defendants to sell 20 shares of Pittsburgh Coal. They 
 were then carrying for his account 10 shares of this stock. The fol- 
 lowing day he gave an order to buy 20 shares of Pittsburgh Coal, 
 which according to the finding of the auditor, was to cover the 10 
 shares ordered to be sold "beyond the amount which the defendants 
 carried for his account." Except in these two instances, whenever 
 the plaintiff gave an order to sell, he understood that the defendants 
 were carrying for his account on margin the shares which he ordered 
 sold. Whenever an order was given to buy he expected that the de- 
 fendants would carry out his order by the purchase of shares in ac- 
 cordance with the rules of the stock exchange; and whenever an or- 
 der was given to sell he intended the defendant would make an actual 
 sale. It was found by the auditor that when the plaintiff opened the 
 account he stated he intended to buy and sell on margin. 
 
 R. h. c. 99, § 4, provides so far as material, that whoever employs 
 another to buy or sell for his account any securities, intending at the 
 time there shall be no actual purchase or sale, may recover in an ac- 
 tion of contract from the person employed any payment made, if the 
 person so employed had reasonable cause to believe that said inten- 
 tion existed ; but there shall be no right of action if in accordance vHth 
 the terms of the employment an actual purchase or sale of the secu- 
 
1272 ILLEGAL CONTRACTS (Ch. 9 
 
 rities or a valid contract therefor is made. By section 6 of this stat- 
 ute, if the person employing another to sell for his account did not 
 own the securities at the time and settlements were made without the 
 completion of the purchase or sale, these facts shall be prima facie 
 evidence within the meaning of section 4 that it was intended no ac- 
 tual sales or purchases should be made and there was reasonable cause 
 to believe said intention existed. 
 
 The purchase and sale of stocks by a broker who carries them on 
 margin for his customer are not prohibited by this statute. Unless 
 the person employing the broker meant there should be no actual sales 
 or purchases and the broker had reasonable cause to beUeve that such 
 was the case, the statute is not transgressed. Rice v. Winslow, 180 
 Mass. 500, 62 N. E. 1057. It is not the unrevealed intention of the 
 plaintiff that is to be proved, but his purposie as appears by the trans- 
 action, the acts accompanying it, the means employed, and by all the 
 other circumstances competent as evidence to show his intention and its 
 disclosure to the defendant. See Marks v. Metropolitan Stock Ex- 
 change, 181 Mass. 251, 254, 63 N. E. 410; Anderson v. Metropolitan 
 Stock Exchange, 191 Mass. 117, 122, 17 N. E. 706. Unless it appears 
 that the plaintiff intended that a real transaction should not take place 
 by the actual purchase and sale of securities, his case, under the statute^ 
 fails. The plaintiff did not show he contemplated there should be no 
 actual sales or purchases by the defendants; the auditor expressly finds 
 as a fact upon all the evidence that the plaintiff expected each time he 
 gave an order to buy that the defendants would execute his order and 
 actually purchase the stocks in accordance with the rules of the stock 
 exchange ; and whenever he gave an order to ^ell that the defendants 
 would sell the stock as directed. Such transactions are not wagering 
 ones, and are not forbidden by the statute, R. L. c. 99, §§ 4, 6; Rice 
 V. Winslow, supra; Post v. Leland, 184 Mass. 601, 604, 60S, 69 N. E. 
 361.2» 
 
 The meaning and the effect of' this finding are not diminished by the 
 findings that the defendants had reason to believe the plaintiff did not 
 intend to receive from them or to deliver to them the stocks -v^hich he 
 directed them to purchase or to sell ; and that between these parties 
 there should be no actual sales or purchases. It is immaterial that 
 between the plaintiff and the defendants there were to be no dehveries. 
 Rice V. Winslow, supra ; Post v. Leland, supra. The statute refers to 
 the plaintiff's intention — that intention relates solely to sales and pur- 
 chases to be made by the defendants, and if the plaintiff intended that 
 actual sales and purchases were to be executed between the defend- 
 ants and those from whom they bought and to whom they sold, the 
 statute does not give the plaintiff a remedy. 
 
 In each of the two instances when the 40 shares of Butte & Supe- 
 rior and the 20 shares of Pittsburg Coal were ordered to be sold by 
 
 23 In accord : Hopkins v. O'Kane, 169 Pa. 478, 32 Atl. 421 (1895). 
 
Sec. 3) CHAMPERTY AND MAINTENANCE 1273 
 
 the plaintiff, on the following day orders were given by him to buy 
 a like amount to take their place. The slips confirming the sales con- 
 tained the provision that if delivery was not made by the plaintiff the 
 defendants were authorized to make delivery for his account and to 
 loan the securities for this purpose. The plaintiff read these condi- 
 tions : he gave no notice that they were adverse to his contract and he 
 testified that he agreed to them. This finding is not inconsistent with 
 the finding that he intended actual sales and purchases should be 
 made, and he failed to show that the transaction was a wagering con- 
 tract, under the statute he cannot recover. See Chandler v. Prince, 
 221 Mass. 495, 109 N. E. 374. 
 
 As it was contemplated that there should be actual purchases and 
 sales of the stock, as found by the auditor, it. is immaterial that the 
 defendants did not set apart for the plaintiff the specific shares bought 
 for him. See Davy v. Bangs, 174 Mass. 238, 54 N. E. 536; Chase v. 
 Boston, 180 Mass. 458, 460; 62 N. E. 1059; Rice v. Winslow, su- 
 pra. * * * 
 
 Judgment for defendants. 
 
 SECTION S.^CHAMPERTY AND MAINTENANCE 
 
 HUTLEY v. HUTLEY. 
 (In the Queen's Bench, 1873. L. R. 8 Q. B. Cas. 112.) 
 
 Declaration that one John Hutley, a brother of defendant and 
 a cousin pf plaintiff, had died, leaving extensive landed estates and 
 large personal property; and defendant was the heir at law of the 
 deceased and one of his next of kin; and the deceased died, leaving a 
 will whereby his property real and personal was left to persons other 
 than plaintiff and defendant; and plaintiff believed that such will 
 revoked a former will by which the testator had bequeathed certain 
 .property to plaintiff; and in consideration that plaintiff would take, 
 'the necessary steps to contest the validity of the said will, and wouM 
 advance certain moneys and obtain evidence for such purpose and 
 instruct an attorney in that behalf, defendant promised that he would 
 pay to plaintiff one half of any personal property and convey to him 
 a moiety of any landed estates he might recover or which might come 
 to him, defendant, by reason of the taking of such proceedings for 
 the setting aside such will; and plaintiff took such steps as aforesaid, 
 and advanced certain moneys and instructed an ^ttorney, and a 
 large sum of money was thereby recovered by defendant and the said 
 will was declared invalid and defendant became entitled to and ob- 
 tained possession of large landed estates of the deceased- Allegation 
 
1274 ILLEGAL CONTRACTS (Ch. 9 
 
 of all conditions precedent. Breach that defendaijt had not paid to 
 the plaintiff half the said personal property or conveyed to him one 
 half of the said real estates. 
 
 Demurrer. Joinder in demurrer. 
 
 Blacicburn, J.^* The question is whether the contract disclosed on 
 this declaration is such as can be enforced in a court of law. Putting 
 out of the question, for the moment, the position of the plaintiff- it 
 alleges that the defendant is heir at law and one of the next of kin of 
 a deceased person who had made a will by which the personal and 
 real estate were left away from the defendant, and in consideration 
 that the plaintiff would take the necessary steps to contest the validity 
 of the will, and would advance certain moneys, and obtain evidence, 
 and instruct an attorney, the defendant promised to pay to the plain- 
 tiff one half of the personal estate, and convey to him a moiety of 
 the real estate, which the defendant should recover. If that stood with- 
 out more, it is clear that it is champerty by the English law, which 
 says that a bargain, whereby the one party is to assist the other in re- 
 covering property, and is to share in the proceeds of the action, is 
 illegal: Sprye v. Porter, 7 E. & B. 58, 81, 26 L. J. (Q. B.) 64, 71, 
 was one of the cases cited, and I entirely agree with what is there 
 said. ' Lord Campbell, delivering the judgment of the Court says : 
 "Here we have maintenance in its worst aspect, the plaintiff and Rosaz, 
 entire strangers to the property which they say the defendant has a 
 title to, but which is in the possession of another claiming title to it, 
 agree with him that legal proceedings shall be instituted in his name 
 for the recovery of it, and that they will supply him, not with any 
 specified or definite documents or information, but with evidence that 
 should be sufficient to enable him successfully to recover the property. 
 Each of them is to have one fifth of the property when so recovered; 
 and unless the evidence with which they supply him is sufficient for 
 this purpose, they are to receive nothing. They are not tq employ the 
 attorney, or to advance money to carry on the litigation ; but they are 
 to supply that upon which the event of the suit must depend, evidence ; 
 and they are to supply it of such a nature and in such quantity -as to 
 secure success. The plaintiff purchases an interest in the property 
 in dispute, bargains for litigation to recover it, and undertakes to , 
 maintain the defendant in the suit in a manner of all others the most 
 likely to lead to perjury and to a perversion of justice. Upon prin- 
 ciple such an agreement is clearly illegal; and Stanley v. Jones, 7 
 Bing. 369, is an express authority to that effect." Putting aside that 
 the plaintiff there was an absolute stranger, the present agreement goes 
 further than that, for the present plaintiff agrees to instruct an at- 
 torney and advance money, and falls short of it so far as that the pres- 
 ent plaintiff only agrees to obtain evidence, whereas in Sprye v. Porter, 
 7 E. & B. 58, 26 L. J. (Q. B.) 64, the plaintiff undertakes to supply 
 
 2* The concurring opinions of Lnsli and Arcliibald, JJ., are omitted. 
 
Sec. 3) 
 
 CHAMPERTY AND MAINTENANCE 1275 
 
 evidence sufficient to ensure success. But the mischief is as great in 
 the one case as in the other, and both agreements are void as amount- 
 ing to maintenance and champerty. 
 
 But then it is argued that the position of the plaintiff with relation 
 to the defendant and the property in question takes it out of the 
 rule against champerty and maintenance. The declaration alleges that 
 the plaintiff was a cousin of the deceased, and so a relation of the 
 defendant, who was the deceased's brother ; and the plaintiff's counsel 
 cited cases which he said shewed that such relationship prevented an 
 agreement like the present from being illegal. But he produced no 
 authority that blood relationship between the parties made any differ- 
 ence as to champerty. Then the further allegation was relied on, that 
 the plaintiff believed that the will which was to be contested revoked 
 a former will by which the testator had bequeathed certain property 
 to the plaintiff; and it was argued that because me plaintiff thought 
 he had an interest in the litigation by which the one will was to be up- 
 set and the other revived, the agreement was not illegal. But the 
 litigation was to be maintained by the plaintiff not solely, as far as he 
 was concerned, for any benefit he might directly or indirectly derive 
 himself from upsetting the will, but the bargain was that he would 
 maintain the action in consideration of the defendant transferring to 
 him half the property which the defendant might become possessed of 
 as the fruits of the litigation. While, therefore, I incline to agree with 
 every word that is said by Lord Abinger and lyord Cranworth in 
 Findon v. Parker, 11 M. & W. 675, 679, that an agreement to assist in 
 bringing an action is not made maintenance by the fact that the party 
 turns out to be mistaken in supposing that he had a common interest 
 with the litigant parties in the result of the suit; I can not see that 
 that case is any authority for the present plaintiff. If every word that 
 is said in the declaration about the plaintiff's belief in his interest 
 in the subject matter of the suit were true, that would not justify or 
 make legal the agreement to share in the property -to be recovered by 
 the defendant. 
 
 There must, therefore, be judgment for the defendant.^= * * * 
 
 25 See, also, Johnson v. Van Wyck, 4 App. D. C. 294, 41 L. R. A. 520 (1894). 
 
 There is no champerty, unless the compensation for conducting the suit is to 
 be a share of that which is recovered by the judgment. The agreement is not 
 champertous merely because the fee is to be contingent on success and the 
 amount is dependent upon the amount recovered and the judgment is as- 
 signed as security for the fee. Blaisdell v. Ahem, 144 Mass. 393, U N. E. 
 681 59 Am. Rep. 99 (1887) ; Hadlock v. Brooks, 178 Mass. 425, 59 N. E. 
 1009 (1901) ; Bennett v. Tighe, 224 Mass. 159, 112 N. B. 629 (1916). 
 
 It is generally held that maintenance is an essential part of champerty, 
 and that the agreement is not illegal, unless he who is to be paid by a share 
 of the proceeds of the suit also is to pay the expense of the litigation. Phil- 
 lips V South Park Com'rs, 119 111. 626, 10 N. E. 230 (1887) ; Peck v. Heuncn, 
 167 U S 624 17 Sup. Ot. 927, 42 L. Ed. 302 (1897) ; Hart v. State ex rel. 
 Rock 120 Ind. 83, 21 Ni E. 654, 24 N. E. 151 (1889) ; Jewel v. Neidy, 61 
 Iowa,' 299, 16 N. W. 141 (1883) ; Northwestern f- S. Co. v. Cochran 191 Fed 
 146, ill C. C. A. 626 (1911) ; Brown v. Ginn, 66 Ohio St. 316, 64 N. E. 123 
 
1276 ILLEGAL C0NTEACT3 (Ch. 9 
 
 WitHITE V. ROBERTS. 
 (C!ourt of Appeals of Kentucky, 1836. 4 Dana, 172.) 
 
 EwiNG, ].'" George Roberts, as the survivor of Roberts and Rudd, 
 brought an action of debt against Presley Wilhite, on a penal bond for 
 four hundred dollars, to which the following condition is attached : 
 
 "The condition of the above obligation is such that whereas the above 
 named Roberts and Rudd, as my attorneys, have, for me, commenced 
 an action of ejectment in the Nelson Circuit Court. * * * Now, 
 if the said Rudd and Roberts shall succeed in recovering possession of 
 said lot of ground, on the demise aforesaid, then I oblige myself to pay 
 them to the amount of one half of the value of the above mentioned 
 ground," * * * 
 
 The defendant * * * filed the following plea : "that said Rob- 
 erts and Rudd, at the time of the date of said covenant, had commenced, 
 and were prosecuting, a suit in ejectment, on the demise of plaintiff's 
 wife etc. for a lot of ground, and that, contrary to the law of the land 
 against champerty and maintenance, it was illegally agreed between 
 the said Roberts and Rudd on the one part, and the defendant on the 
 other, that the said defendant should give and convey one half of said 
 lot of ground to said Roberts and Rudd, for their services in prosecut- 
 ing said suit, and that said obligation was procured, by the said Roberts 
 and Rudd, as a security for the performance by the said defendant, of 
 said illegal agreement, and was taken in the form in which it is 
 written, fraudulently, for the purpose of evading the force of the law 
 against champerty and maintenance, and that the same was given with- 
 out any other consideration ; and this he is ready to verify." 
 
 To this plea a demtirrer was filed by the plaintiff, and joined, and 
 the demurrer sustained by the Court. And the most important ques- 
 tion arising on the record, is as to the sufficiency of this plea to bar 
 the plaintiff's action. 
 
 It is provided in the second section of the act "to revive and amend 
 the champerty and maintenance law" (Stat. L,aw, 286) that "it shall not 
 be lawful for any person or persons, to contract, or to undertake to re- 
 cover, or carry on any suit for the recovery of any such pretended right 
 or title to land as aforesaid, of which adverse possession is held under 
 conflicting title as aforesaid, for or in consideration to have part or 
 profit ^ereof ; and the parties to such contract shall forfeit all right, 
 title, interest or claim in or to the land claimed under such pretended 
 right or title, and all right to maintain any action or suit at law or 
 equity, upon such pretended right or title ; and such right, title or claim 
 
 (1902) ; Perry v. Dicken, 105 Pa. 83, 51 Am. Rep. 181 (1884) ; Dockery v. 
 McLellan, 98 Wis. 381, 67 N. W. 733 (1896). Contra: Ackert v. Barker, 131 
 Mass. 436 (1881). 
 
 ^« Parts of the report have been omitted.- 
 
Sec. 3) CHAMPEETT AND MAINTENANCE 1277 
 
 shall vest in the Commonwealth, and enure to the benefit of the per- 
 son in possession without office found." ^^ 
 
 We have no idea, that the bond sued on, contains any stipulation, on 
 its face, in conflict with the provisions of the foregoing section. It is 
 as competent for a litigant to regulate the amount of his attorney's 
 fee, by the value or half the value of the property in contest, as to reg- 
 ulate it by the value, or half the value, of any other piece of property. 
 
 Whether he regulates it by the one or the other, or agrees to pay a 
 contingent fee in money, agreed upon by the parties at the time, he is 
 not subject to the denunciations of the statute, — ^provided he is not to 
 give a part or profit out of the thing in contest. 
 
 But champerty is the most odious species of maintenance, and was 
 an offence at common law, and has been denounced by various highly 
 penal statutes, in aid of the common law. It always has been regarded 
 as an offence against the peace of society, the administration of im- 
 partial justice, and tending to the encouragement of litigation and the 
 oppression of the weak. And the courts have been uniformly vigilant, 
 where the peace and quietude and justice of the country are regarded, 
 not only in enforcing their penalties, but in declaring void all contracts 
 made in derogation of their provisions. If the contract contained any 
 stipulation on its face in derogation of their provisions, we should find 
 no difficulty in treating it as a nullity, and refusing all aid from the 
 law and the Courts in enforcing it, or any stipulation in it however law- 
 
 Till T» -K I* 
 
 But there being no stipulation or recital in this bond, evidencing a 
 violation of the statute of champerty, the question occurs, if there be a 
 secret agreement between the parties, whereby the plaintiff was to 
 receive part or profit of the property in contest, and the written con- 
 tract was based upon it, and fraudulently exacted as a penalty or se- 
 curity to enforce a compliance with its illegal terms, whether this secret 
 contract can be averred and proved, and if so, will such averment and 
 proof invalidate the written contract? 
 
 We can perceive no principle of reason or' law that inhibits the 
 averment and proof. Though it be a general rule that nothing can be 
 averred and proved against the stipulations of a written contract, this 
 rule does not apply where the contract is illegal, or against the positive 
 prohibitions of a penal statute. Hence in the case of usury, though a 
 contract in writing be fair oru its face, or import a consideration or 
 contract perfectly legal, the real transaction may be averred and prov- 
 ed, by parol testimony. 
 
 2 7 This statute goes much beyond the common law. Blackstone defined 
 champerty as a "species of maintenance, and punished in the same manner, 
 beins a bargain with a plaintife or defendant campum partire, to divide the 
 land or other matter sued for between them, if they prevail at law, where- 
 upon the champerter is to carry on the party's suit at his own expense. See 
 Thompson v. Reynolds, 73 111. 11 (1874), where a lawyer agreed to bring suit, 
 pay all expenses, and to receive one half of whatever should be recovered. 
 
1278 ILLEGAL GONTEACTS (Ch. 9 
 
 No instrument is so sacred, when tinctured with illegality or fraud, 
 as to raise it above the scrutiny of parol testimony. And indeed it 
 would be highly impolitic that it should ; for if this rule should pre- 
 vail as applicable to illegal and vicious contracts, it would be an easy 
 mlatter to place all contracts, however illegal or vicious, above the 
 reach of the law. 
 
 It would only be necessary for the parties, as is alleged in the 
 case before the Court, to have a secret, illegal understanding, and to 
 introduce into a written contract, fair upon its face, stipulations that 
 are legal, but highly penal, as a means to enforce a compliance with the 
 terms of the secret illegal bargain. The arm of the law is not so short 
 as to permit such evasion. * * * 
 
 It follows that the facts alleged in the plea, if true, are a good bar to 
 the plaintiff's action, and the demurrer should have been over- 
 ruled. * * * 
 
 ELLIS V. FRAWLEY et al. 
 (Supreme Court of Wisconsin, 1917. 165 Wis. 381, 161 N. W. 364.) 
 
 Action by L. Olson Ehis against William H. Frawley and another. 
 Judgment for plaintiff, and defendants appeal. Reversed and remand- 
 ed, with direction to dismiss the complaint on the merits. 
 
 Action for an accounting and settlement of the affairs of a joint 
 business venture or partnership. The plaintiff is a lawyer residing 
 and practicing at Black River Falls; the defendants are lawyers re- 
 siding and practicing at Eau Claire. In October, 1911, a destructive 
 flood occurred in the Black river by which much private and public 
 property was destroyed in the city of Black River Falls. It was claim- 
 ed generally that the flood resulted from the negligence of the La 
 Crosse Water Power Company in the operation of its dam across said 
 river. The complaint charged that in April, 1912, the plaintiff and 
 defendants made a partnership agreement by which they were to act 
 jointly as attorneys in prosecuting claims for all persons who might 
 employ them to sue for and collect their claims against the power com- 
 pany arising out of said flood, and that in pursuance of that agreement 
 the partnership brought suits for a large number of such claimants and 
 performed professional services in such suits and finally effected a 
 settlement of such claims for a large sum of money, and that the de- 
 fendants received in 'payment for such partnership services more than 
 $20,000, of which one-half belongs to the plaintiff; but that said de- 
 fendants refuse to pay the plaintiff any part thereof. The defendants 
 denied the existence of any such partnership. The action was tried by 
 the court without a jury, and the court found that no partnership 
 was formed, but "that plaintiff at the request of the defendants render- 
 ed services to the defendants in inducing flood sufferers to retain the 
 defendants to prosecute their claims and in procuring assignments 
 
Sec. 3) CHAMPERTY AND MAINTENANCE 1279 
 
 of such claims, that he continued to render services to the defendants 
 during the years 1912 and 1913 with reference to the losses sustained 
 and claims made by such flood sufferers which defendants were seek- 
 ing to recover through actions brought by them acting as attorneys for 
 such flood sufferers" ; also, "that said services rendered by the plain- 
 tiff to the defendants at their special instance and request are rea- 
 sonably worth the sum of $975." There is no bill of exceptions. The 
 defendants appeal from judgment; against them in accordance with 
 the findings. 
 
 WiNSLOW, C. J.''(after stating the facts as above). There being no 
 bill of exceptions, the only inquiry presented is whether, upon the facts 
 found by the trial court, the judgment is right. Those facts are : A 
 firm of lawyers requested another lawyer to go around among the flood 
 sufferers and persuade them to employ the firm to prosecute their dam- 
 age claims and to execute assignments of their claims to one person for 
 the purpose of facilitating the litigation ; the second lawyer undertook 
 the task, was successful in his work, and has recovered the value 
 thereof. 
 
 The judgment is right unless the arrangement between the par- 
 ties was against public policy ; if it was, the judgment is wrong and 
 must be reversed, even though the objection be now made for the first 
 time. Jacobson v. Bentzler, 127 Wis. 566, 107 N. W. 7, 4 L. R. A. 
 (N. S.) 1151, 115 Am. St. Rep. 1052,, 7 Ann. Cas. 633. The court will 
 not allow itself to be used as the means of carrying into effect a con- 
 tract which is essentially contrary to morality or to public policy, even 
 though no objection be made by the parties. Wight v. Rindskopf , 43 
 Wis. 344. It seems that the arrangement was clearly against public 
 policy. 
 
 ■The mere intermeddler, the officious stirrer up of litigation in which 
 he has no interest save the possibility of a commission or a fee, has 
 been condemned by courts and legislators since the earliest times. This 
 is so because the practice of the law is not a trade but a ministry. * * * 
 
 It is stated in respondent's brief that the claims secured by the aid 
 of the plaintiff were all assigned to one person, that one action was 
 commenced thereon, buf that before trial a settlement was made for 
 a sum somewhere between' $50,000 and $60,000, out pf which the de- 
 fendants, by virtue of their contracts with the claimants, retained 40 
 per cent.', or about $22,000. These facts are not in evidence, but they 
 may properly be assumed as true as against the party who asserts 
 them. This then was the scheme to the consummation of which the 
 plaintiff agreed to contribute, i. e., a scheme to get hold of all the 
 claims possible, and in case of success 40 per cent, of the proceeds was 
 to go to the lawyers and 60 per cent, (probably after payment of costs) 
 to the people .whose property had been swept away. 
 
 Attorneys are entitled to good pay, for their work is hard; but they 
 
 2 8 Part of the opinion is omitted. 
 
1.280 ILLEGAL CONTRACTS (Ch. 9 
 
 are not entitled to fly the black flag of piracy. Such contracts as are 
 here in question tend to make the lawyer forget his high duty as a min- 
 ister of Justice and to convert him into a mere grubber for money in 
 the muck-heaps of the world. They also tend to make the name of 
 lawyer a proverb and a byword among laymen. 
 
 A number of courts have condemned contracts of this nattire. 2 
 Thornton on Attorneys, § 436: Gammons v. Johnson, 76 Minn. 76, 
 78 N. W. 1037;. Holland v. Sheehan, 108 Minn. 1, 122 N. W. 1, 23 L. 
 R. A. (N. S.) 510, 17 Ann. Cas. 687; Ingersoll v. Coal Co., 117 Tenn. 
 263, 98 S. W. 179, 9 L. R. A. (N. S.) 282, 119 Am. St. Rep. 1003, 10 
 Ann. Cas. 829 ; Meguire v. Corwine, 101 U. S. 108, 25 L. Ed. 899 ; 
 Ford V. Munroe (Tex. Civ. App.) 144 S. W. 349. 
 
 In most of the cases cited the party soliciting the business was a lay- 
 man, but it is not perceived how this fact af^cts the principle involved. 
 If it is against public policy for a layman to foment litigation and make 
 a claim bureau of himself under contract with a law firm, it would 
 seem to be fully as much so for a lawyer to do the same thing. 
 
 The contract being against public policy, the courts will affirmatively 
 assist neither party, but will leave them where it finds them. * * * 
 
 Reversed with direction to dismiss the complaint. 
 
 JOHNSON et al. v. GREAT NORTHERN RY. CO. 
 
 (Supreme Court of Minnesota, 1915. 128 Minn. 365, 151 N. W. 125, L. R. A. 
 
 1917B, 1140.) 
 
 Action by Christ Johnson against the Great Northern Railway Com- 
 pany, wherein John I. Davis and Davis & Michel, employed as attor- 
 neys for plaintiff on a contingent fee, petitioned for judgment against 
 defendant, which had settled with plaintiff without the knowledge or 
 consent of his attorneys. Judgment ordered for petitioners, and, de- 
 fendant appeals. Affirmed. 
 
 BuNN, J.^' John I. Davis and Davis & Michel were the attorneys 
 for Christ Johnson in an action brought by him against defendant to 
 recover for personal injuries. Before the case came to trial, defend- 
 ant settled with Johnson without the knowledge or consent of his at- 
 torneys. The terms of the settlement were these: Defendant agreed 
 to pay Johnson $4,500 in cash, to reimburse him for any sum he should 
 be compelled to pay his attorneys, to pay all hospital and doctor's bills, 
 and to furnish him free of charge with an artificial leg when he was 
 in condition to use one. The $4,500 was paid to Johnson, and the suit 
 and cause of action compromised and settled. 
 
 The attorneys were employed by Johnson under a contingent fee 
 contract, by the terms of which they were to receive for their services 
 33l^ per cent, of any amount recovered by settlement or suit. The 
 
 2» Part of the opinion is omitted. 
 
Sec. 3) CHAMPERTY AND MAINTfeNANCB 1281 
 
 contract provided that any moneys advanced by the attorneys for ex- 
 penses were to be deducted from the gross amount received by set- 
 tlement or suit. It also provided that no settlement was to be made 
 without the consent of Johnson. 
 
 This proceeding was by a complaint or petition filed by the attorneys, 
 and was entitled in the main action. The petition set forth in detail 
 the contract between Johnson and the petitioners, the commencement 
 of the personal injury action, the settlement thereof, and its terms. 
 Fraud was also alleged. Judgment against defendant for $2,000 and 
 interest was demanded. Defendant filed an answer to the petition 
 which, after admitting the commencement of the action and the set- 
 tlement, proceeded to charge that petitioners were, and had been for 
 a loiig time, engaged in "the business and conspiracy of unlawfully 
 stirring up strife and contention and vexatious and speculative liti- 
 , gation between the defendant and persons having' personal injury 
 claims against this defendant, and preventing the amicable compromise 
 of said claims without litigation"; that petitioners, in solicitmg and 
 obtaining claims against defendant traveled from place to place and 
 employed for such purpose a large number of laymen as agents and 
 solicitors; that, for the purpose of obtaining cases against defendant, 
 they have unlawfully paid to claimants large sums of money for the 
 support and maintenance of claimants during the litigation; that they 
 pay all costs and disbursements connected with litigation on the under- 
 standing with claimants that the latter, in case there is no recovery, 
 shall not be liable therefor, and that petitioners will reimburse them- 
 selves, for the money so advanced, out of the proceeds of the litiga- 
 tion. 
 
 The answer further charged petitioners with preventing the amicable 
 settlement of claims by advising all claimants that they are entitled to 
 sums of money greatly in excess of the actual damages suffered, thus 
 unlawfully fomenting litigation against defendant. Thus far the 
 charges made were general in their nature, and had no reference to 
 this particular case. The answer then proceeded to allege that peti- 
 tioners solicited the claim of Johnson, wrongfully persuaded him not 
 to make an amicable settlement, by promising to obtain a recovery 
 largely in excess of compensation, to advance large sums for his living 
 expenses, and to pay all costs and expenses of the litigation, and to re- 
 imburse themselves solely out of the amount recovered from defend- 
 ant. It was alleged that, had it not been for these representations and 
 promises, the claim would have been amicajbly settled without suit for 
 substantially the amount actually paid ; that the unlawful conduct of 
 petitioners "in this case and the whole course of unlawful conduct of 
 the petitioners in soliciting and obtaining personal injury cases against 
 'this "defendant and other corporations has resulted in constant, need- 
 less strife and contention between this defendant and its eniployes and 
 other claimants, in unnecessary and speculative litigation niuch to the 
 
 COEBIN CONT — 81 
 
1282 ILLEGAL CONTRACTS (Ch. 9 
 
 detriment of this defendant and greatly to the prejudice of justice." 
 In conclusion, the answer alleged that, by reason of the unlawful and 
 champertous conduct of petitioners, they have no lien upon the cause 
 of action settled by defendant, and further that their contract with 
 Johnson was null and void, for champerty and maintenance and as 
 against public policy. The reply was a general, denial. 
 
 The court, on petitioners' motion, made an order vacating the set- 
 tlement for the purpose of hearing and determining what fees should 
 be paid by defendant to the attorneys for plaintiff. This matter was 
 heard by the trial court without a jury. After petitioners established 
 their contract with Johnson, the fact of the settlement, and that they 
 had received no compensation, defendant called each of the petitioners 
 for cross-examination, and attempted to prove by him the allegations 
 of its answer. The court sustained objections to practically all ques- 
 tions asked and to numerous offers to prove the facts alleged, and the 
 case was submitted for decision with no evidence in support of the de- 
 fense. The court subsequently filed its decision finding the facts in 
 favor of petitioner, and that the "other allegations" of the pleadings 
 were untrue, and ordering judgment in favor of the petitioners and 
 against defendant for $2,000 and interest. 
 
 The questions involved are these: (1) Did the court err in exclud- 
 ing the evidence offered by defendant in support of allegations of its 
 answer? (2) Did it err as to the amount petitioners are entitled to 
 recover ? 
 
 1. As to the ruling in sustaining objections to questions and offers 
 relating to the conduct of petitioners in general, and in other cases, 
 it is clear that these matters were wholly irrelevant to the issue — per 
 titioners' right to a lien in this particular case. 
 
 The facts offered to be proved that related to petitioners' conduct in 
 the Johnson case were substantially these: (1) That they solicited 
 Johnson's case; (2) that they paid money to Johnson for his support 
 during the pendency of the litigation ; (3) that they advised him not 
 to settle the case. 
 
 Is conduct of this kind so against public policy that the courts will 
 deny to attorneys guilty of it their statutory lien on the client's cause 
 of action? We freely concede that champerty or maintenance in a 
 case may be ground for refusing the aid of the court in compelling 
 compensation to the guilty attorneys. But is it champerty or mainte- 
 nance or against public policy for an attorney to solicit business, to 
 pay money to a poor client for his living expenses during the litiga- 
 tion, or to advise him against a settlement of his case ? We may have 
 our individual opinions on these propositions as questions of good 
 taste or legal ethics. But in the absence of some statute we are un- 
 able to hold that it is illegal or against public policy for an attorney to 
 solicit a case. See concurring opinion of Justice Canty in Gammons 
 v. Johnson, "K) Minn. 76, 78 N. W. 1035. The practice of advancing 
 money to the injured client with which to pay living expenses or hos- 
 
Sec. 3) CHAMPERTY AND ' MAINTENANCE 1283 
 
 pital bills during the pendency of the case and while he is unat)le to 
 earn anything may, in a sense, tend to foment litigation by preventing 
 a settlement from necessity; but we are aware of no authority, hold- 
 ing that it is against public policy, or of any sound reason why it 
 should be so considered. 
 
 It is generally held that a person, whether an attorney or a layman, 
 who furnishes assistance by moiiey or otherwise to a poor man to en- 
 able him to carry on an action, is not guilty of maintenance.'" 6 Cyc. 
 865, and cases cited; N. W. S. S. Co. v. Cochran, 191 Fed. 146, 111 
 C. C. A. 626. It is not against public policy for an attorney to loan 
 his client money to enable him to carry on the suit. This is the utmost 
 extent to which the offer of evidence went, and it was not error to 
 sustain the objection. 
 
 As to the offer to prove that the petitioners advised Johnson against 
 settling the case, representing that he was entitled to heavy damages, 
 we know of no reason why this should be held contrary to public pol- 
 icy. Johnson did not agree not to, make a settlement without the 
 consent of his attorneys ; indeed, the contract expressly provides that 
 the attorneys shall not settle without his consent. The law favors the 
 amicable settlement of controversies, and it is wrong for a lawyer 
 to discourage settlements out of personal motives. But there was no 
 offer to prove any such conduct in this case; indeed, the evidence 
 shows pretty clearly that the petitioners advised and attempted to pro- 
 cure a settlement. 
 
 2. Defendants argue that an agreement by an attorney to pay the 
 expenses of litigation and reimburse himself from the proceeds of the 
 action is void. But the contract in this case only provided that the 
 attorneys might retain out of the amount recovered any moneys ad- 
 vanced for expenses. There was no offer to show an oral agreement 
 that the attorneys were to support the litigation at their own expense 
 or to indemnify the client against costs. The argument therefore fails, 
 and the cases cited have no application. As before stated, an agree- 
 ment to loan the client funds with which to carry on the suit or to 
 maintain himself during its pendency is not regarded as per se op- 
 posed to public policy. It. is only when the attorneys are to ultimate- ' 
 ly stand the costs, or when the client is indemnified from liability for 
 them in case of no recovery, that the law declares the arrangement 
 void. Huber v. Johnson, 68 Minn. 74, 70 N. W. 806, 64 Am. St. Rep. 
 456; 6 Cyc. 858, 865, and cases cited. 
 
 After a careful reading of the record, we find nothing in the evidence 
 excluded that was material— nothing that would have justified the 
 trial court in refusing relief to petitioners. Nothing can be added to 
 what has been said in prior decisions of this court on the subject of 
 
 3 In accord- Harris v. Brisco, IT Q. B. D. 504 (1886); ThaUWmer v. 
 53 L K A.952, 83 Am. St. Bep. 794 (1900). 
 
1284 ILLEGAL OpjJTIlACTS (Ch. 9 
 
 champerty and maintenance. Huber v. Johnson, 68 Minn. 74, 70 N. 
 W. 806, 64 Am. St. Rep. 456; Gammons v. Johnson, 69 Minn. 488, 72 
 N. W. 563 ; Id., 76 Minn. 76, 78 N. W. 1035 ; Gammons v. Gulbran- 
 son, 78 Minn. 21, 80 N. W. 779; Holland v. Sheehan, 108 Minn. 362, 
 122 N. W. 1, 23 L. R. A. (N. S.) 510, 17 Ann. Cas. 687. These cases 
 in no way touch the case at bar. There was no illegality in the writ- 
 ten contract between Johnson and the petitioners, and no offer to prove 
 any facts that would have made the contract illegal as against public 
 policy. * * * 
 Affirmed. 
 
 FOWLER V. CALLAN. 
 (Court of Appeals of New York, 1886. 102 N. Y. 395, 7 N. B. 169.) 
 
 Finch, J. It does not affect the validity of the contract between the 
 attorney and his client that, measured by the old rules relating to 
 champerty and maintenance, it would have fallen under their condem- 
 nation; for neither doctrine now prevails except so far as preserved 
 by our statutes. Sedgwick v. Stanton, 14 N. Y. 289. The attorney 
 may agree upon his compensation; and it may be contingent upon his 
 success, and payable out of the proceeds of the litigation. Such con- 
 tracts are of common occurrence, and, while their propriety has been 
 vehemently debated, they are not illegal, and, when fairly made, are 
 steadily enforced. In substance, that was the contract here made, and 
 there would be no question about it had it not contained a provision by 
 the terms of which the attorney not only agreed to rely upon success 
 for his compensation, but also to assume all costs and expenses of the 
 litigation, and indemnify his client against them. It is this feature of 
 the contract which raises the question necessary to be determined. 
 
 The facts of the case are not very fully developed, but appear to be 
 that the defendant, as devisee under a will, was entitled to certain real 
 estate ; his right dependent upon the validity of the will, and in some 
 manner threatened by proceedings before the surrogate, which put his 
 interest in peril, and made a defense essential to its protection. In 
 this emergency he sought the aid and professional service of the plain- 
 tiff, and retained him as attorney. The latter neither sought the re- 
 tainer, nor did anything to induce it. So far as appears, it was not 
 occasioned by any offer or solicitation of his, but originated in the free 
 and unbribed choice of the client. The evidence does not show wheth- 
 er the latter had gained possession of the land devised or was out of 
 possession, but he gave to the attorney a deed of the one undivided 
 half part of the property, taking back his covenant to conduct the de- 
 fense to its close, paying all costs and expenses of the litigation, and 
 indemnifying the devisee against all such liability. 
 
 The agreement appears to have been purely one for compensation. 
 
Sec. 3) CHAMPERTY AND MAINTENANCE 1285 
 
 If the client had given to the attorney money instead of land, the con- 
 tract would have differed in no respect except the contingent character 
 of the compensation. The arrangement contemplated success in the 
 litigation, in which event the land would pay the costs and expenses 
 and the attorney's reward, and both would be discharged out of the 
 property of the client placed in the hands of the attorney for that pre- 
 cise purpose. The contract in no respect induced the litigation. That 
 was already begun, and existed independently of the agreement, and 
 originated in other causes. It did not tend to prolong the litigation. 
 It made it to the interest of the attorney to close it as briefly and 
 promptly as possible, and at as little cost and expense as prudence 
 would permit. The plaintiff, therefore, stirred up no strife, induced 
 no litigation, but merely agreed to take for his compensation so much 
 of the value of the land conveyed to him as might remain after, out of 
 that value, the costs and expenses had been paid. 
 
 We do not think the statute condemns such an agreement. 3 Rev. 
 St. (6th Ed.) p. 449, §§ 59, 60; Code, §§ 73, 74. The Code revision 
 changed somewhat the language of the prohibition, but nevertheless 
 must be deemed a substantial re-enactment of the earlier sections. 
 Browning v. Marvin, 100 N. Y. 148, 2 N. E. 635. They forbid— First, 
 the purchase of obligations named by an attorney for the purpose and 
 with the intent of bringing a suit thereon ; and, second, any loan or 
 advance, or agreement to loan or advance, ''as an inducement to the 
 placing, or in consideration of having placed, in the hands of such at- 
 torney" any demand for collection. The statute presupposes the ex- 
 istence of some right of action, valueless unless prosecuted to judg- 
 ment, which the owner might or might not prosecute on his own be- 
 half, but which he is induced to place in the hands of a particular at- 
 torney by reason of his agreement to loan or advance money to the 
 client. It contemplates a case in which the action might never have 
 been brought but for the inducement of a loan or advance offered by 
 the attorney; and in which the latter, by officious interference, pro- 
 cures the suit to be brought, and obtains a retainer in it. The statute 
 speaks of a "demand" which, by enforcement, will end in a "collec- 
 tion;" phrases which have no aptness to the situation of one simply 
 defending a good title to land against the efforts of others seeking to 
 destroy the devise under which he claims. The plaintiff made no 
 "loan or advance," in any proper sense of those words. They imply 
 a liability on the part of the client to repay what was thus lent or ad- 
 vanced. The attorney loaned nothing, and he advanced nothing to the 
 client which the latter was bound to reimburse. Simply, he was paid 
 in advance an agreed price, taken in land instead of money, and out of 
 which he was first to pay tosts and expenses. 
 
 The facts before us are not within the terms of the statutes, as it 
 respects a "demand" which is the subject of "collection;" but our con- 
 clusion rests more strongly upon the conviction that the agreement 
 
1286 ILLEGAL CONTRACTS (Ch. 9 
 
 made was one for compensation merely, and had in it no vicious ele- 
 ment of inducing litigation or holding out bribes for a retainer. 
 
 The judgment should be reversed, and a new trial granted; costs to 
 abide the event. All concur. ^^ 
 
 BURNES v. SCOTT et al. 
 
 (Supreme Court of the United States, 1886. 117 U. S. 582, 6 Sup. Ct. 865, 29 
 
 L. Ed. 991.) 
 
 This was an action at law brought by Milton Courtright against 
 James N. Burnes, the plaintiff in error, upon the note of the latter 
 made at Chicago, and dated October 10, 1872, whereby he promised to 
 pay, 30 days after date, to the order of F H. Winston, $7,333, at the 
 Cook County National Bank, in Chicago. Courtright, by indorse- 
 ment and transfer, became the owner and holder of the note. The 
 defendant pleaded four pleas ; * * * 
 
 The last plea was that the suit was prosecuted under an agreement 
 between the plaintiff and George W. De Camp, his attorney, whereby 
 the latter undertook to prosecute the suit, and pay all the expenses 
 incident to its prosecution, in consideration that he should receive 
 four-tenths of the amount recovered.^ ^ 
 
 The parties waived a trial by jury, and submitted the issues of fact, 
 as well as of law, to the court, which made a general finding for the 
 plaintiff, and entered judgment thereon in his favor against the de- 
 fendant, Burnes, for $11,401.60, who thereupon sued out this writ 
 of error. After the record was filed in this court Courtright died, and 
 the executors of his last will were made defendants in error in his 
 stead. 
 
 Woods, J. * * * It further appears from the bill of exceptions 
 that, in support of the plea that the plaintiff had made a champertous 
 agreement with his counsel for the prosecution of this suit, the defend- 
 ant offered evidence which tended to prove a contract made by the 
 
 '1 In some states it is declared that the common-law doctrines of mainte- 
 nance and champerty are unknown, Mathewson v. Fitch, 22 Cal. 86 (1863) ; 
 Smits V. Hogan, 35 Wash. 290, 7T Pac. 390, 1 Ann. Gas. 297 (1904) ; and in 
 most there is a marked tendency to narrow the doctrines of champerty or to 
 evade them, Reece t. Kyle, 49 Ohio St. 475, 31 N. E. 747, 16 L. E. A. 723 
 (1892) ; Dunne v. Herrlck, 37 111. App. 180 (1890) ; Manning v. Sprague, 
 148 Mass. 18, 18 N. E. 673, 1 L. R. A. 516, 12 Am. St. Rep. 508 (1888) ; Rich- 
 ardson V. Rowland, 40 Conn. 565 (1873). See 12 L. R. A. (N. S.) 606. 
 
 The subject is quite often regulated hy statute, as it is in New York. Irwin 
 y. Curie, 171 N. Y. 409, 64 N. E. 161, 58 L. R. A. 830 (1902) . Thus in Michigan 
 it is provided "that all existing laws, rules, and provisions of law, restricting 
 or controlling the right of a party to agree with an attorney, solicitor, or 
 counsel, for his compensation, are repealed, and hereafter fhe measure of such 
 compensation shall be left to the agreement, express or implied, of the parties." 
 See Lehman v. Detroit G. H. & M. R. Co., 180 Mich. 362, 147 N. W. 628 (1914) ; 
 Johnson v. Missouri Pac. R. Co., 139 Ark. 507, 214 S. W. 17 (1919). 
 
 ''^^ The statement of facts is condensed and only so much of the opinion as 
 relates to this plea is here printed. 
 
Sec. 3) CHAMPERTY AND MAINTENANCE 1287 
 
 plaintiff with his counsel, George W. De Camp, by which the latter 
 agreed to- prosecute the suit and defray all the expenses thereof, in 
 consideration of which he was to receive a certain proportion of the 
 sum recovered. The court, however, did not give effect to this plea, 
 and overruled a motion made by the defendant to dismiss the action 
 on the ground that the plaintiff had made such champertous contract. 
 This action of the court the defendant assigns for error. 
 
 At common law and by statute, both in England and in many of 
 the United States, champerty was a criminal offense. But at the 
 present time, in most of the states, to aid the lawful suit of another 
 with money or services, in consideration of a share jn the recovery, 
 is not considered or punished as a crime. But in many of the states 
 champertous contracts are considered void. This is the case in Mis- 
 souri, where the present case was tried ; the supreme court so holding 
 on the ground that the common law had been adopted by statute in 
 that state. See Duke v. Harper, 66 Mo. 51, 27 Am. Rep. 314. The 
 defendant now asks us to go a long step beyond this ruling. 
 
 The question raised by the present assignment of error is not 
 whether a champertous contract between counsel and cHent is- void, 
 but whether the making of such a contract can be set up in bar of a 
 recovery on the cause of action to which the champertous contract 
 relates. We must answer this question in the negative. It was wisely 
 said by the supreme court of New York, in the case of Thallhimer v. 
 Brinckerhoff, 3 Cow. 623, 15 Am. Dec. 308, that "the right of litiga- 
 tion riiay be abused, and proper remedies for groundless and vexa- 
 tious litigation must exist; but the remedies for the abuse of this 
 right should be such as not to impair the free use of the right itself. 
 As the justice or injustice of the claim cannot be known before the 
 termination of the cause, the checks upon unjust litigation must in 
 general consist, not in excluding the suit or the suitor from the 
 courts, but in redress following the decision of justice upon the merits 
 of the case." Thi^ is in accord with the views of this court. 
 
 The precise question under consideration was decided in the case 
 of Boone v. Chiles, 10 Pet. 177, 9 L. Ed. 388. That was a bill in 
 equity to establish the title to a tract of 700 acres of land in Bourbon 
 county, in the state of Kentucky. Among other defenses it was 
 alleged that an agreement in writing had been made between Boone, 
 the plaintiff, and one Engles, by which Engles undertook, at his own 
 expense, to prosecute a suit for the 700 acres in dispute, and, as a con- 
 sideration for his trouble, was to have one-half of the land, and that 
 the suit was prosecuted under that agreement ; that it was therefore 
 a case of champerty and maintenance forbidden by law, in which the 
 court could give no relief. But the court held that, aUhough the 
 English statutes, which had been adopted in Kentucky, punished the 
 offense, and declared the contract for maintenance void between the 
 parties,' the right of the plaintiff was not forfeited by such an agree- 
 ment, and it might be asserted against the defendants whether the 
 
1288 ILLEGAL CONTKAOTS (Ch. 9 
 
 contract with Engles was valid or void. The same rule has been de- 
 clared in other American cases. Whitney v. Kirtland, 27' N. J. Eq. 
 333 ; Robison v. Beall, 26 Ga. 17 ; Allison v. Chicago & N. W. R. Co., 
 42 Iowa, 274. So, in Hilton v. Woods, L. R. 4 Eq. 432, it was strenu- 
 ously urged that the bargain between the plaintiiif and Mr. Wright, 
 under which the suit was instituted, amounted to champerty and main- 
 tenance, and consequently disqualified the plaintiff to sue, and that 
 the court was bound to dismiss the bill. But the vice-chancellor said : 
 "I have carefully examined all the authorities which were referred to 
 in: support of this argument, and they clearly establish that, whenever 
 the right of tha plaintiff in respect of which he sues is derived under 
 a title founded on champerty or maintenance, his suit will on that 
 account necessarily fail. But no authority was cited, nor have I met 
 any, which goes the length of deciding that when a plaintiff has an 
 original good title to property he becomes disqualified to sue for it 
 by having ventured into an improper bargain with his solicitor as to 
 the mode of remunerating him for his professional services in the suit 
 or otherwise." There was therefore a decree for the plaintiff, though 
 without costs. In Elborough v. Ayres, E. R. 10 Eq. 367, it was con- 
 ceded that the fact that the plaintiff, in an action for malicious prose- 
 cution, had been maintained, would be no bar to the action, and the 
 vice-chancellor held that such maintenance would be no ground for 
 the interference of a court of equity to prevent the action from going 
 on, citing Vice-chancellor Wigram in Evans v; Prothero. 
 
 The only cases to which we have been referred in which the rule 
 insisted on by the defendant has been maintained were two cases 
 decided in the supreme court of Wisconsin : Barker v. Barker, 14 Wis. 
 131, and Allard v. Lamirande, 29 Wis. 502. 
 
 We think, therefore, that both upon reason arid weight of authority 
 the court did not err in refusing to give effect to the fourth plea of 
 the defendant, or in refusing to dismiss the suit because it was prose- 
 cuted under a champertous agreement between th^ plaintiff and his 
 counsel. Judgment affirmed. ^^ 
 
 3s In accord: Staub v. Sewanee Ck)al, Coke & Land Co., 140 Tenn. 505, 205 
 S. W. 320 (1918) ; Powell v. Bowen, 279 Mo. 280, 214 S. W. 142; Sims v. 
 Stovall, 12T Ark. 186, 191 S. W. 954 (1917) ; Small v. C, R. I. & P. R. Co., 55 
 Iowa, 583, 8 N. W. 437 (1881) ; Bigelow v. Old Dominion Copper Mining & 
 Smelting Co., 74 N. J. Eq. 457, 71 Atl. 153 (1908). 
 
 But if the plaintiff sues as assignee, and the assignment is void because of 
 champerty, the assignee paying the expenses solely for what he can make out 
 of the suit as a speculation, this is a good defense. Hudson v. Sheafe, 41 S. 
 D. 475, 171 N. W. 320 (1919) ; Miles v. Mutual Reserve Fund Life Ass'n, 108 
 Wis. 421, 84 N. W. 159 (1901) ; Sampliner v. Motion Picture Patents Co., 255 
 Fed. 242, 168 C. C. A. 202 (1918), reversed by the TJ. S. Supreme Court in 
 1920 on the ground that the assignment was in satisfaction of a pre-existing 
 debt, and not solely for speculation in litigation. 
 
 A solicitor was disbarred for one year for organizing a debt-collecting 
 agency and conducting the litigation on a percentage basis. In re A Solicitor. 
 [1912]. 1 K. B. 302. 
 
Sec. 4) AGREEMENTS TO STIFLE A PROSECUTION 1289 
 
 SECTION 4.— AGREEMENTS TO STIFLE A PROSECUTION 
 
 JONES V. RICE. 
 (Supreme Judicial Court of Massachusetts, 1837. 18 Pick. 440, 29 Am. Dec. 
 
 Assumpsit on a promissory note, dated January 1st, 1835, made by 
 the defendant to the plaintiff, for $147. 
 
 At the trial, before Shaw, C. J., it appeared that on the night of De- 
 cember 31st, 1834, a ball was given at the house of Joel Jones, in 
 Sudbury; that an attempt was made by the defendant and others' to 
 interrupt the ball by violence; that a riot ensued, in which some' in- 
 jury was done to J. Jones and others, assembled at the ball; that a 
 complaint was filed before a justice of the peace and a warrant issued 
 by him against some pf the rioters ; that the persons assembled at 
 the ball chose a committee to report on the terms which should be pro- 
 posed to the accused, for a settlement of the difificulty ; that the com- 
 mittee reported that the accused should pay the sum of $184; -that of 
 this amount the sum of $40 was for damages sustained by three indi- 
 viduals, $10 for the services of the officer, and $2 for the services of 
 the magistrate, and that the balance was for the purpose of stopping 
 that and other prosecutions ; that it was thereupon voted by those as- 
 sembled at the ball, that if the accused would pay the sum proposed 
 or give security for it, the other party would do nothing more about 
 the matter ; that the accused agreed to the terms and paid about $40, 
 and the defendant, at their request, gave the note in suit for the 
 balance ; that J. Jones and others, including the plaintiff, then signed 
 a receipt "in full for all damages sustained by the ball party assembled, 
 &c. and all other demands of any name or nature of said ball party" ; 
 and that in consequence of this arrangement the officer made no return 
 of the warrant, and no further proceedings were had upon the com- 
 plaint. 
 
 The Chief Justice was of opinion, that the plaintiff was not entitled 
 to recover, because the evidence proved a want of consideration or 
 a bad consideration for the note; and the plaintiff consented to a 
 nonsuit, subject to the opinion of the whole court. 
 
 Putnam, J. delivered the opinion of the court. The facts reported 
 disclose, that divers persons committed an aggravated riot and as- 
 sault upon the plaintiff and others, and that the note was given partly 
 for the damages and expenses which the plaintiff and others had sus- 
 tained, and partly for their agreement no further to prosecute for 
 the offeiice against the public. The sum of $52 was given for the 
 damages and expenses, and $132 for the compounding of the misde- 
 meanor; part was paid in money, smd the balance was secured by 
 the note now sued. 
 
1290 ILLEGAL CONTRACTS (Ch. 9 
 
 Cases have been cited from the English authorities which sustain 
 the distinction between considerations arising from the compound- 
 ing of felonies, which is admitted to be illegal, and thfe compoundiiig 
 of misdemeanors, which is alleged to 'be lawful ; but it appears that 
 there is a conflict in the decisions upon this matter. In Drage v. Ibber- 
 son, 2 Esp. 643, Lord Kenyon held, that the consideration for settling 
 a misdemeanor was good in law. And the case of Fallowes v. Taylor, 
 7 Term R. 745, proceeds upon the same principle. It was there held 
 by Lord Kenyon and the rest of the court, that a bond given to the 
 plaintiff (who was clerk of the quarter sessions and who was directed 
 to prosecute the defendant for a public nuisance,) conditioned to 
 remove the nuisance, was valid, notwithstanding it was taken by 
 the plaintiff for his own use, he agreeing not to prosecute for the 
 nuisance. 
 
 We do not think, that such a power is vested in individuals. It 
 would enable them to use the claim of the government for their own 
 emolument, and greatly to the oppression of the people. It has a 
 direct tendency to obstruct the course of the administration of jus- 
 tice; and the mischief extends, we think, as well to misdemeanors as to 
 felonies. 1 Russ. Crimes, 210; Edgcombe v. Rodd, S East. 301. 
 
 The power to stop prosecutions is vested in the' law officers of the 
 commonwealth, who use it with prudence and discretion. If it were 
 given to the party injured, who might be the only witness who Could 
 prove the offence, he might extort for his own use, money which prop- 
 erly should be levied as a firie upon the criminal party for the use of 
 the commonwealth. The case at bar furnishes a strong illustration 
 of the illegality of such a proceeding. The plaintiff claimed and got 
 the note to secure to his own use four times as much as in his 
 own estimation his individual damage amounted to. Now the sum 
 thus secured might be more or less than the rioters would have been 
 fined ; but whether more or less is altogether immaterial ; for no 
 part of it belonged to the party. He might settle for his own damage 
 from the riot; but it would enable the party to barter away the 
 public right for his own emolument, if we were to hold that the con- 
 sideration of this note was lawful. 
 
 We are all of opinion, that the ;ionsuit must stand.^* 
 
 3* In accord: Berry v. Duun, 201 Ala. 275, 78 South. 51, L. R. A. 1918Dj 939 
 (1918), seduction; Winter v. Lewis, 132 Ark. 399, 200 S. W. 981 (1918), false 
 pretenses; Sanders v. McKee, 145 Ga. 507, 89 S. B. 484 (1916), swindling; 
 Partridge v. Hood, 120 Mass. 403, 21 Am. Rep. 524 (1876) ; Haynes v. Rudd, 
 102 N. Y. 372, 7 N. E. 287, 55 Am. Rep. 815 (1886) ; Insurance Co. v. Hull, 51 
 Ohio St. 270, 37 N. E. 1116, 46 Am. St. Rep. 571 (1894) ; Graham v. Hiesel, 73 
 Neb. 483, 102 N. W. 1010 (1905). But a prosecuting officer may agree to dis- 
 miss a prosecution in consideration of the accused giving testimony against 
 other offenders. Nickelson v. Wilson, 60 N. Y. 362 (1875). . , . 
 
 In Kerridge v.. Simmonds (Australia) 4 0. L. R. 253 (l906), after reviewing- 
 certain English cases, the court held "that the law allows the compromise of 
 a prosecution for oral defamation for which the injured party can sue and 
 recover damages. Here the plaintiff was entitled to sue for damages foy tlje 
 oral slander. Can it then make any difference that she had laid a com- 
 
Sec. 4) AGREEMENTS TO STIFLE A PBOSECUTION 1291 
 
 BOARD OP EDUCATION OF DISTRICT OF NORTHFORK v. 
 
 ANGEL, et al. 
 
 (Supreme C!ourt of Appeals of West Virginia, 1915. 75 W. Va. 747, 84 S. E. 
 747, L. E. A. 1915E, 139.) 
 
 Action by the Board of Education of the District of Northfork 
 against C. S. Angel and others. Judgment for plaintiff, and defend- 
 ants bring error. Affirmed. 
 
 Miller, J.^= Defendants, Angel, Toney, Kaufman and Strudwick, 
 seek reversal of a judgment against them on a note dated October 30, 
 1903, made by one Roberts, payable sixty days after date, to one 
 E. T. Sprinkle, Sheriff of McDowell County, for nine hundred and 
 twenty one dollars--and five cents, negotiable and payable at the Mc- 
 Dowell County Bank, Welch, West Virginia, and endorsed by them 
 and also by their codefendants, Tipton, Roberts, Ballard and Bots- 
 ford. 
 
 Besides, the general issue and the plea of the statute of Hmitations 
 of ten years, plaintiffs in error interposed as defenses, by special plea 
 number 2, "that if they signed the note sued upon as endorsers thereon, 
 the said note was given and their endorsements obtained for an ille- 
 gal consideration, to-wit: to suppress a criminal prosecution for a 
 felony begun and put on foot against the maker of said note, F. G. 
 Roberts, and this they are ready to verify." * * * 
 
 The real and only question of merit presented by plea, and by an 
 instruction given by the court in lieu of instruction number 1, re- 
 quested by plaintiff, and defendants' instructions numbered 2 and 3, 
 rejected, is whether, as alleged in the plea, and as assumed by de- 
 fendants' two instructions rejected, said note and the endorsements 
 thereon were given or procured in consideration of the suppression 
 of a criminal prosecution for a felony begun and put on foot against 
 said Roberts, as alleged in said plea, or to stop such intended prose- 
 cution, as assumed in said instructions. 
 
 The evidence is that the note was made by Roberts, who had been 
 
 plaint for the slander upon the same day on which the agreement was signed? 
 Onttat complaint the defendant might have been pumshed by a fine, or 
 committed for trial, bu.t the injury complained of was a purely ^rsonal in- 
 cornnittea TO ^ ^ gtinction between a case of defamation and a case of 
 
 common Tssault from the point of view of public concern. For these reasons 
 iTm of opfnion that it iinot unlawful for a person defamed, or who has 
 sust^ned purely personal injury, to withdraw a prosecution already inst^uted 
 lor lich an offence, or to agree not to institute such a prosecution Whe^ 
 a ™n is entitled to recover pecuniary damages the suggestion that there 
 fa a sodal duty incumbent upon him to prosecute is untenable. The law al- 
 lows "either to prosecute or to sue for damages, and I can see nothing to 
 irlvent^im from a^eeing to receive an indemnity for the personal injury he 
 hlfsSstained leaving the representatives of the public to prosecute if they 
 thfnk fit If? as infme cases, he is the only person entitled to institute the 
 prJ)secution then a fortiori It is a matter of private, and not of public, con- 
 cern." 
 3 5 Part of the opinion is omitted. 
 
1292 ILLEGAL CONTRACTS (Ch. 9 
 
 secretary of said board of education, to coyer the amount of certain 
 orders drawn by him on said sheriff, as treasurer ex officio of the school 
 funds of said district, and on which he had forged the name of the 
 president, and had- thereby fraudulently procured and embezzled 
 money and funds belonging to said school district, and that at the 
 time he executed said note with the endorsers he had been arrested 
 and was then in the custody of a constable on a warrant sworn out 
 by the prosecuting attorney, and who also represented the said board of 
 education in the taking of said note. 
 
 It is well settled law that, though criminal proceedings have been 
 begun and be pending against the wrongdoer for the crime^ one whose 
 money or property has been embezzled, or fraudulently procured, may 
 contract with such wrongdoer for re-payment or satisfaction of the 
 loss, and take security therefor, without invalidating such contract, 
 unless there be included therein and as part consideration therefor 
 some jpromise or agreement^ express or implied, that such prosecution 
 shall be suppressed, stifled or stayed. 9 Cyc. 506, and notes, citing 
 cases; Johnston v. Allen, 22 Fla. 224, 1 Am. St. Rep. 180; Portner 
 V. Kirschner, 169 Pa. 472, 32 Atl. 442, 47 Am.. St. Rep. 925; 1 Page 
 on Const, sec. 418; Tecumseh National Bank v. Chamberlain Bank- 
 ing House, 63 Neb. 163, 88 N. W. 186, 57 L. R. A. 811; Fosdick v. 
 Vari Arsdale, 74 Mich. 302, 41 N. W. 931. 
 
 On the other hand, it is equally well settled, that if such an un- 
 lawful promise or agreement constitutes any part of the considera- 
 tion for the promise or agreement of the wrongdoer or his sureties, 
 the contract is wholly void and will not be enforced fey the courts. 
 AH such contracts are deemed contrary to good morals and public 
 policy, and as to which the courts will turn a deaf ear, when their en- 
 forcement is sought therein. And this rule of law as between the par- 
 ties thereto is applicable to the making and enforcement of negotia- 
 ble instruments. 1 Daniel on Neg. Inst. (6th Ed.) section 196a and 
 notes; 3 R. C. L. p. 957; Norton on Bills and Notes, 268, 277, 27S; 
 Henderson v. Palmer, 71 111. 579, 22 Am. Rep. 117; Friend v. Miller, 
 52 Kan. 139, 34 Pac. 397, 39 Am. St. Rep. 340; 1 Chit. Com. L. 4; 4 
 Am. & Eng. Ency. Law, 191. 
 
 The evidence is clear and convincing that as, between Roberts, the 
 offender, and maker of the note, and the board of education, and the 
 sheriff, the nominal payee in the note, not a word of communication 
 was had. No promise or agreement, written or verbal, was made be- 
 tween them, directly at least, in regard to the~pending prosecution, or 
 what was to become of it, on execution and endorsement of the note. 
 The prosecuting attorney in charge of the prosecution, and represent- 
 ing the board of education, admits a conversation with the, members of 
 the board who were together conferring on the subject on the day the 
 note was executed and endorsed, in which they indicated to him that 
 so far as they were concerned, if Roberts would secure them by a note 
 
Sec. 4,) AGEEEMENTS TO STIFLE A PROSECUTION 1293 
 
 with good security, they would not insist on his being prosecuted. This 
 conference and communication, however, was wholly private, and 
 between the board and prosecutor, and was not communicated in any 
 way, so far as the record shows, to maimer or endorsers of the note, 
 and the prosecuting attorney swears positively that he at no time made 
 any promises to Roberts or his endorsers that Roberts would not be 
 prosecuted. He said on cross-examination that his recollection was 
 that Roberts wanted to pay the board the money he admitted he had 
 takeii, and wanted these defendants as his friends to endorse the note 
 as an accommodation to him, and he was satisfied that no promise not 
 to prosecute Roberts was made to maker or endorsers, or either of 
 them, as part consideration for the execution of the note by them. 
 Plaintiffs in error. Angel, Toney and Kaufman, the only defendants 
 who gave testimony on the trial, do not swear that any promises not 
 to prosecute Roberts were made to them; and all they did say on the 
 subject was that they endorsed the note to keep Roberts out" of jail. 
 Neither of them swore that the prosecuting attorney, or the board of 
 education, or the sheriff who was not present, made any promise not 
 to prosecute Roberts. It is conceded, however, that immediately after 
 the note was made and endorsed Roberts was released from custody, 
 and contrary to his representations that he proposed to go to work and 
 pay the note to the reUef and discharge of his sureties, he left the 
 State the same night by a freight train, and never returned. This fact 
 is referred to by plaintiff's counsel as corroborative of the fact that no 
 promise not to prosecute him was made as part consideration for the 
 note. Certainly there is no evidence of an express promise. That is 
 expressly and positively denied. True such a promise and agreement 
 may be inferred from the facts relating to the transaction ; but such 
 inference is one of fact for the jury, and not of law for the court, and 
 as their verdict was for plaintiff, we must assume that they decided 
 the issue in favor of plaintiff, and the validity of the note. * * * 
 We are of opinion to affirm the judgment.^* 
 
 3 In accord: Ogden v. Ford, 179 Cal. 243, 176 Pac. 165 (1918). If the 
 verdict bad been for the defendants, no doubt it would have been sustained. 
 Promises not to prosecute are often not express, but they may' be inferred 
 from all the facts. See Williams v. Bayley, L. E. 1 H. L. 200 (1866), a veiled 
 threat of prosecution In order to induce embezzler's mother to give security ; 
 McKenzie V Lynch, 167 Mich. 583, 133 N. W. 490, settlement of crim. con., 
 with promise not to "do anything whereby this matter will acquire any 
 publicity whatever." . x * „ <_„ ^„^ 
 
 Contracts to Procure Evidence.— A promise to pay a contingent fee to one 
 who will procure or will give certain testimony is fei\erally illegal Goodrich 
 V Tenney: 144 111. 422, 32 N. E. 44, 19 L. R. A. 371, 36 Am. St. Rep. 459 (1893) ; 
 Davis V. Smoot, 176 N, C. 538, 97 S. B. 488 (1918) ; Neecev Joseph, 95 Ark 
 552, 129 S. W. 797, 30 L. R. A. (N. S.) 278, Ann. Gas. 1912A, 655 (1910) I 
 Manufacturers' & Merchants' Inspection Bureau y. Everwear Hoisery Oo. 152 
 Wis. 73, 138 N. W. 624, 42 L. R. A. (N. S.) 847, Ann. Oas. 19140 449 (1913). 
 
 A contract to shadow a party to a divorce suit and to report the facts ob- 
 served is not illegal, if payment is not contingent on success and there is 
 no agreement to secure specific evidence. Hare v. McGue, 178 Cal. 740, 174 
 Pac. 663 (1918). 
 
1294: ILLEGAL CONTRACTS (Ch. 9 
 
 SECTION 5.— AGREEMENTS OUSTING THE COURTS OF 
 
 JURISDICTION 
 
 (Arbitration Agreements) 
 
 NASHUA RIVER PAPER CO. v. HAMMERMIIvL PAPER CO. 
 
 (Supreme Judicial Court of Massachusetts,, 1916. 223 Mass. 8, 111 N. E. 678, 
 
 L. K. A. 1916D, 691.) 
 
 Action by the Nashua River Paper Compariy against the Hammer- 
 mill Paper Company. Demurrers to defendant's answer in abateinent 
 and answer in bar overruled, and case reported. Demurrers sustain- 
 ed, and case to stand on answer to the merits. 
 
 RuGG, C. J. The question is whether, in a contract between a man- 
 ufacturer and its sales agent, a provision is valid to the eflfect that 
 "no action at law, equity or chancery shall be instituted or maintained 
 by the corporation in any court of any state of the United States or 
 in any Circuit or District Court of the courts of theUriited States 
 against the company other than in the courts of the common pleas of 
 the state of Pennsylvania." This stipulatibn occurs in an ordinary 
 cornmercial contract between a corporation domiciled in this common- 
 wealth and another corporation incorporated under the laws of Penn- 
 sylvania'. 
 
 It becomes necessary to review some of the cases. Nute v. Hamil- 
 ton Mut. Ins. Co., 6 Gray, 174, was an action upon a f>olicy of in- 
 surance, one stipulation of which, incorporated in the contract by ref- 
 erence to the by-laws of the company, was in substance that any 
 "action shall be brought at a proper court in the county of Essex." 
 It was held that this stipulation was not binding, and that an action 
 could be brought in any county where the venue properly might be 
 laid. The general principle on which this decision was made to rest 
 was that it was not within the province of parties to enter into an 
 agreement concerning the remedy for a breach of contract, which is 
 created and regulated by law. Considerations of public policy were 
 adverted to as supporting the conclusion, but not given decisive 
 weight. Chief Justice Shaw, in concluding the discussion, said : "The 
 greatest inconvenience would be in requiring courts and juries to 
 apply dififerent rules of law to different cases, in the conduct of suits, 
 in matters relating merely to the remedy, according to the stipula- 
 tions of parties in framing and diversifying their contracts in regard 
 to remedies." 
 
 • In Hall v. People's Mut. Fire Ins. Co., 6 Gray, 185, the provision 
 of the contract of insurance was explicit to the effect that no action 
 should be brought upon the policy except in the county of Worcester. 
 
Sec. 5) AGREEMENTS OUSTING THE COURTS OP JURISDICTION 1295 
 
 Chief Justice Shaw, in giving the opinion of the court, after adverting 
 to Nute V. Hamilton Mut. Ins. Co. as substantially deciding the ques- 
 tion, said : "The court were of opinion that a stipulation in an original 
 contract, that in case of breach the suit shall be brought in a particu- 
 lar county, or, in other words, that a suit shall not be brought in a 
 county in which it is directed by law to be brought, is not a proper 
 matter of contract. After a contract has been made and broken, the 
 remedy is regulated by law, and of course must be governed by the 
 law of the forum where the remedy is sought. * * * It is a well 
 settled maxim that parties cannot, by their consent, give jurisdiction 
 to courts, where the law has not given it ; and it seems to follow, from- 
 the same course of reasoning, that parties cannot take away jurisdic- 
 tion, where the law has given it." 
 
 The same point was decided in Amesbury v. Bowditch Mut. Fire 
 Ins. Co., 6 Gray, 596, 603. In Roberts v. "Knights, 7 Allen, 449, it 
 was held that a British subject, who had shipped in England as sea- 
 man for an entire voyage under a statutory law which provided that 
 under such contract no seaman should sue for wages in any court 
 abroad except in case of discharge or danger to life, nevertheless 
 might bring an action against the master of the vessel although both 
 parties were residents of Great Britain. It commonly has been 
 thought that "such law enters into the terms of the contract and be- 
 comes a part of its obligation." Hanscom v. Maiden & Melrose Gas- 
 light Co., 220 Mass. 1, 7, 107 N. E. 426, Ann. Cas. 1917A, 145. 
 Therefore the refusal of the court to give any heed to the British stat- 
 ute is significant, although tnere was no discussion of the point here 
 raised. These cases generally have been understood as supporting 
 the proposition that parties could not contract that their disputes 
 arising under the contract should be litigated in a single court or in 
 the courts of a particular jurisdiction. 
 
 It was held in Home Ins. Co. v. Morse, 20 Wall. 445, 22 E. Ed. 365, 
 that a statute making it a condition precedent to the granting of the 
 privilege to a foreign corporation to do business within a state, that 
 it would not remove suits from state to federal courts, was unconstitu- 
 tional and a contract to that effect was invalid. It there was said, at 
 page 451 of 20 Wall, 22 L- Ed. 365: "A man may not barter away 
 his life or his freedom, or his substantial rights. * * * In a civil 
 case he may submit his particular suit by his own consent to an 
 arbitration, or to the decision of a single judge. So he may omit to 
 exercise his right to remove his suit to a federal tribunal, as often 
 as he thinks fit, in each recurring case. In these aspects any citizen 
 may no doubt waive the rights to which he may be entitled. He can- 
 not, however, bind himself in advance by an agreement, which may be 
 specifically enforced, thus to forfeit his rights at all times and on all 
 occasions, whenever the case may be presented." a^ * * * 
 
 3T The court here cited in accord :■ Doyle v. Continental Ins. Co., 94 IT. S. 
 535, 24 L. Ed. 148 (1876) ; Prince Steam Shipping Co. v. Lehman (D. C.) 
 
1296 : : ; illegal contracts (Ctx. 9 
 
 It was held in Benson v. Eastern Building & Loan Ass'n, 174 N. 
 Y. 83, 86, 66 N. E. 627, in substance that parties cannot in the ordi- 
 nary case by contract deprive courts of competent jurisdiction of their 
 power to adjudicate causes on the ground that that jurisdiction is 
 prescribed by law and it cannot be increased or ditninish^d by agree- 
 ment of parties. In Mut. Reserve Fund Life Ass'n v. Cleveland 
 Woolen Mills, 82 Fed.. 508, at page 510, 27 C. C.A. 212, at 214, it was 
 said by Lurton, J. : "The policy [of msurance] * * * contained 
 a stipulation that no suit in law or equity should be brought upon it 
 except in the Circuit Court of the United States. This provision in- 
 tended to oust the jurisdiction of all state courts is clearly invahd. 
 Any stipulation between contracting parties distinguishing between 
 the different courts of the country is contrary to pubUc policy and 
 should not be enforced." ?» * * * 
 
 In many of these cases' the opinion of this court by Chief Justice 
 Shaw in Nute v. Hamilton Myt. Ins. Co., 6 Gray, 174, has been cited 
 and relied on as an authority. Attempts to place limitations by con- 
 tract of the parties upon the powers of courts as to actions growing 
 out of the particular contract, or to oust appropriate courts of their 
 jurisdiction, have been regarded with disfavor arid commonly have 
 been held invalid. Guaranty Trust & Safe Deposit Co. v. Green Cove 
 Springs & Melrose R. R. Co., 139 U. S. 127, 140, 11 Sup. Ct. 512, 35 
 L. Ed. 116; Meacham v. Jamestown, Franklin & Clearfield R. R., 211 
 N. Y. 346, 352, 353, 105 N. E. 653, Ann. Cas. 1915C, 851. It might 
 be argued with force that the law as to the enforcement of rights 
 arising out of personal injuries was imported into the terms of a con- 
 tract for hire. Yet it has been decided that statutory limitations to 
 the effect, that a right of action for personal injuries shall be confined 
 to the state where it occurred, are invalid. Atchison, Topeka & Santa 
 Fe Ry. v. Sowers, 213 U. S. 55, 70, 29 Sup. Ct. 397, S3 L. Ed. 695 ; 
 Tennessee Coal, Iron & R. Co. v. George, 233 U. S. 354, 34 Sup. Ct. 
 587, 58 L. Ed. 997, L. R. A. 1916D, 685. 
 
 So iar as we are aware, the current of authority (with the exceptions 
 
 39 Fed. 704, 5 L. R. A. 464 (1889) ; Sloeum v. Western Assur. Co. (D. 0.) 
 42 Fed. 235 (1890). The Etona (D. C.) 64 Fed. 880 (1894) ; Gough v. Ham- 
 burg- Amerikanische Packet fahrt Aktiengesellschaft (D. C.) 158 Fed. 174 
 (1907) ; U. S. Asphalt Refining Co. v. Trinidad Lake Petroleum Co., Ltd. (D. 
 C.) 222 Fed. 1006 (1915). 
 
 3 8 The court here cited, to the same effect, Savage v. People's Building, 
 Loan & Savings Ass'n, 45 W. Va. 275, 282, 31 S. E. 991 (1898) ; Bartlett v. 
 Union Mut. Fire Ins. Co., 46 Me. 500 (1859) ; Reichard v. Manhattan Life 
 Ins. Co., -31 Mo. 518 (1862) ; Indiana Mut. Fire Ins. Co! v. Routledge, 7 Ind. 
 25 (1855) ; Baltimore & Ohio R. R. v Stankard, 56 Ohio St. 224,' 46 N E 
 577, 49 L. R. A. 381, 60 Am. St. Rep. 745 (1897) ; Owsley v. Yerkes, 187 Fed. 
 560, 109 C. C. A. 250 (1911) ; First Nat. Bank of Kansas City v. White, 220 
 Mo. 717, 737, 120 S. W. 36, 132 Am. St. Rep. 612, 16 Ann. Cas. 889 (1909) ; 
 Healy v. Eastern Building & Loan Ass'n, 17 Pa. Super. Ot. 385, 392, 393 
 (1901) ; Matt v. Iowa Mut. Aid As-s'n, 81 Iowa, 135, 46 N. W. 857, 25 Am 
 St. Rep. 483 (1890) ; Shuttleworth & Co. v. J. Marx & Co., 159 Ala 418 428, 
 South. 83 (1909). 
 
Sec. 5) AGREEMENTS OUSTING THE COURTS OP JURISDICTION 1297 
 
 presently to be noted) is unbroken in support of the principle laid 
 down in Nute v. Hamilton Mut. Ins. Co.. 6 Gray, 174, although that 
 principle is followed by compulsion of authority and under protest, by 
 Judge Hough in United States Asphalt Refining Co. v. Trinidad Lake 
 Petroleum Co., Ltd. (D. C.) 222 Fed. 1006. There are two of our own 
 cases where the principle was not appHed and which appear to be ex- 
 ceptions to it.*' * * * 
 
 In Mittenthal v. Mascagni, 183 Mass. 19, 66 N. E. 425, 60 L. R. A. 
 812, 97 Am. St.. Rep. 404, the parties were both nonresidents. The 
 action was on a contract made in Florence, Italy, where the defend- 
 ant, a subject of the king of Italy, had his home and where the plain- 
 tiffs, citizens of New York, elected a domicile by a provision of the 
 contract. It related to a concert tour through the various states of this 
 country, and was partly to be performed in Florence, and contained 
 the provision that the courts of Florence, Italy, should have exclusive 
 jurisdiction of any difference between the parties, except that the de- 
 fendant reserved a right of action in New York for a payment of his 
 recompense due un,der the contract. It was held that under the cir- 
 cumstances of hurried travel through many different jurisdictions, it 
 was reasonable, that the parties should fix upon the jurisdiction of the 
 domicile of the defendant as the one where disputes should be adjust- 
 ed. As both the parties were nonresidents, they had no standing in, 
 . the courts of this state as matter of strict right, but only as matter 
 of comity. National Telephone Mfg. Co. v. Du Bois, 165 Mass. 117, 
 42 N. E, 510, 30 L. R. A. 628, 52 Am. St. Rep. 503. It, therefore, was 
 regarded as appropriate to yield to the terms of a contract between 
 the parties having such obvious foundation in convenience and reason, 
 although the court well might have declined to exercise any jurisdic- 
 tion of the case on the ground that the parties were aliens. Nute v. 
 Hamilton Mut. Ins. Co., 6 Gray, 174, was referred to in the opinion 
 and not treated as overruled. In this connection Palmear v. Lavers, 
 218 Mass. 286, 291, 105 N. E. 1000, 1002, may be adverted to, where 
 it was said that: "Where one of two parties to a possible litigation, 
 in order to obtain a release from what is equivalent tO' an attachment, 
 agrees that the judgment of a court of first instance shall be final, 
 that agreement does not come within that principle [that is, the prin- 
 ciple of Nute V. Hamilton Mut. Ins. Co., 6 Gray, 174], and that it is 
 an agreement which is binding and will be enforced." 
 
 That decision has no relevancy to the question now presented. Nor 
 is the question here raised, whether the parties may by contract pro- 
 vide that their respective rights growing out of the agreement shall 
 be determined according to the law of a particular jurisdiction. See 
 Brandeis v. Atkins, 204 Mass. 471, 476, 90 N. E. 861, 26 L. R. A. 
 
 3 9 The court here discussed Daley v. People's Building, Loan & Saving Ass'n, 
 178 Mass. 13, 59 N. E. 452 (1901), arguing that it was based on an erroneous 
 conception of the law of New York, as shown in Benson v. Eastern Building 
 & Loan Ass'n, 174 N. T. 83, 66 N. E. 627 (1903). 
 
 COEBIN CONT 82 
 
1298 ILLEGAL CONTRACTS (Ch. 9 
 
 (N. S.) 230; Pritchard V. Norton, 106 U. S. 124, 136, 1 Sup. Ct. 102, 
 27 L. Ed. 104; Greer v. Poole, 5 Q. B. D. 272, 274. 
 
 The Daley and Mittenthal Cases, as to the points adjudicated, while 
 not extending the doctrine of the Nute Case, do not overrule it and 
 are not inconsisteilt with it. All three of these cases may be treated 
 as stating the law applicable to the several states of facts presented to 
 the court. The Nute Case lays down the general principle. The 
 other two cases stand as sound upon their several states of facts. To 
 extend them to the present case involves overruling the Nute Case. 
 That case, as has been pointed out, states a general principle which 
 has been adopted and prevails in all federal courts by reason of 
 the binding decisions of the United States Supreme Court, in Home 
 Ins. Co. V. Morse, 20 Wall. 445, 22 L. Ed. 365 ; and Doyle v. Con- 
 tinental Ins. Co., 94 U. S. 535, 24 L. Ed. 148. The same rule prevails 
 generally in all states where the question has arisen. It relates to a 
 matter as to which uniformity of decision and harmony of law among 
 the several jurisdictions of this country is desirable. It would be un- 
 fortunate if contracts touching a subject of general commercial in- 
 terest and which may be broadly operative as to jurisdiction, should 
 be held valid in one state and invalid in all others. All these 
 circumstances bring us to the conclusion that the clause in the con- 
 tract here in question is unenforceable and that, therefore, the action 
 can be maintained in the courts of this commonwealth. 
 
 The plaintiff's demurrers to the defendant's answer in abatement 
 and to the part of the answer in bar setting up the same matter must 
 be sustained. The case is to stand for disposition upon the issues 
 raised by the answer to the merits. So ordered.*" * * * 
 
 MEACHAM V. JAMESTOWN, F. & C. R. CO. 
 
 '(C!ourt of ApEHsals of New York, 1914. 211 N. Y. 346, 105 N. E. 653, Ann. Cas. 
 
 1915C, 851.) 
 
 Action by Harry W. Aleacham against the Jamestown, Franklin 
 & Clearfield Railroad Company. From an order of the Appellate 
 Division of the Supreme Court, First Department (151 App. Div. 
 941, 136 N. Y. Supp. 1141), affirming a judgment dismissing the 
 complaint entered upon the decision of the trial justice before whom 
 the issues were severed under section 973 of the Code, plaintiff ap- 
 peals. Reversed, and new trial ordered. 
 
 This action was brought by the plaintifif to recover of defendant the 
 sum of $30,079.29, claimed to be due plaintifif as assignee for certain 
 work performed, and materials furnished, by the Thomas McNally 
 Company, a corporation organized under and by virtue of the laws 
 of the state of Pennsylvania. 
 
 *" In accord: Kuhnhold V; Oompagnie G&n6rale Transatl antique (D. O.) 
 251 Fed. 387 (1918), provision making foreign court the sole forum. Cf. 
 Texas Moline Plow Co. v. Blggerstaff (Tex. Civ. App.) 185 S. W. 341 (1916). 
 
Sec. 5) AGREEMENTS OUSTING THE COURTS OF JURISDICTION 1299 
 
 The Franklin & Clearfield Railroad Company was a corporation 
 organized under the laws of the state of Pennsylvania, and, together 
 with other railroad corporations, was consolidated under the name of 
 the present defendant, respondent, a corporation organized under 
 the laws of Pennsylvania, which assumed all of the debts, Uabilities, 
 and obligations of the Franklin & Clearfield Railroad Company, in- 
 cluding the claim in suit. 
 
 In August, 1905, the Franklin & Clearfield Railroad Company and 
 the Thomas McNally Company made a contract in writing for the 
 construction of a section of the Franklin & Clearfield Company's road 
 in the state of Pennsylvania, and thereafter, as alleged by the plain- 
 tiff, the Thomas McNally Company performed work and furnished 
 materials under said contract. 
 
 The contract in question was executed on behalf of the railroad 
 company by its chief engineer, and on the part of the McNally 
 Company by its president and general manag.er. It was conceded in 
 the case that the contract was executed in the state of Ohio. 
 
 The contract contained the following provisions : "In order to pre- 
 vent all disputes and misunderstandings between them in relation to 
 any of the stipulations contained in this agreement, or their perform- 
 ance by either of said parties, it is mutually understood and agreed 
 that the said chief engineer shall be and hereby is made arbitrator 
 to decide all matters in dispute arising or growing out of this contract 
 between them, and the decision of said chief engineer on any point or 
 matter touching this contract shall be final and conclusive between 
 the parties hereto, and each: and every of said parties hereby waives 
 all right of action, suit or suits or other remedy in law or otherwise 
 under this contract or arising out of the same to enforce any claim 
 except as the same shall have been determined by said arbitrator." 
 
 The trial justice before whom die issue was submitted determined 
 as matter of law that submission to the arbitrator named in the con- 
 tract, the chief engineer, and an award by him was and is a valid 
 condition precedent to the plaintiff's right to sue. 
 
 The chief engineer of the railroad company at the time of the making 
 of the contract subsequently died and another engineer assumed the 
 duties of his office. The trial justice held as matter of law that the 
 person who held the office of "chief engineer at the time the submis- 
 sion should have been made was the proper person to whom such sub- 
 mission should have been made, and such submission to and award by 
 him, or offer and tender of such submission on the part of the plaintiff, 
 . was and is a valid condition precedent to plaintiff's right to sue and 
 dismissed the plaintiff's complaint. 
 
 The judgment entered was unanimously affirmed by the Appellate 
 Division, and plaintiff appealed to this court. , 
 
 HoGAN, J. (after stating the facts as above). The trial justice held 
 that the contract in question was to be wholly performed in the state of 
 Pennsylvania, and, the law of that state holding the contract valid 
 
1300 ILLEGAL CONTKAOTS (Ch, 9 
 
 and enforceable governed its operation and effect, consequently the 
 plaintiff could not succeed in this action for the reason that submission 
 to arbitration was a valid condition precedent which had not been com- 
 plied with. 
 
 The clause of the contract, quoted in the statement of facts, con- 
 fers upon the engineer, the arbitrator, power to determine the effect 
 of any stipulation of the contract and whether or not there has been a 
 performance of the same by either party, and to decide "all matters 
 in dispute arising or growing out of the contract." It further 
 provides not only that the decision of the engineer as arbitrator shall 
 be final and conclusive between the parties, but each party "waives 
 all right of action, suit or suits or other remedy in law or otherwise 
 under this contract or arising out of the same to enforce any claim 
 except as the same shall have been determined by said arbitrator." 
 
 Numerous cases involving contracts containing clauses relating to 
 arbitration have been before this court for consideration. In Prest., 
 etc., Delaware & Hudson Canal Co. v. Pennsylvania Coal Co., 50 N. . 
 Y. 250, the question was fully considered, and a distinction made 
 between the provisions of a contract providing that before a right of 
 action shall accrue certain facts shall be determined, or amounts or 
 values ascertained, and an independent covenant or agreement to pro- 
 vide for the adjustment and settlement of all disputes and differences by 
 arbitration to the exclusion of the courts. In subsequent decisions 
 the distinction thus pointed out had been recognized and approved. 
 Seward v. City of Rochester, 109 N. Y. 164, 16 N. E: 348; Sweet v. 
 Morrison, 116 N. Y. 19, 22 N. E. 276, IS Am. St. Rep. 376; National 
 Contracting Co. v. H. R. W. P. Co., 170 N. Y. 439, 63 N. E. 450; Id. 
 192 N. Y. 209, 84 N. E. 965. 
 
 In Guaranty Trust & S. D. Co v. Green Cove S. & M. R. R. Co., 
 139 U. S. 137-142, 11 Sup. Ct. 5fe, 35 L. Ed. 116. an action brought 
 to foreclose a mortgage which provided therein that the mode of sale 
 set forth "shall be exclusive of all others," the court held that such 
 clause was invalid, as tending to oust the jurisdiction of the courts. 
 In Sanford v. Accident Association, 147 N. Y. 326, 41 N. E. 694, the 
 action was brought to recover on a certificate of insurance which con- 
 tained the following clause: "It is hereby stipulated and agreed, by 
 and between this association and the member named herein and his 
 beneficiary, that the issues in any action brought against it under this 
 certificate shall, on the demand of this association or its attorney, be 
 referred for trial to a referee to be appointed by the court, in which 
 such action is brought." An order of reference made against the ob- 
 jection of plaintiff was reversed by the General Term, and the latter 
 order was affirmed by this court, which held that the clause of the 
 contract above quoted was contrary to public policy and not binding 
 on the parties thereto. 
 
 Tested by the principles of the cases cited, we conclude thit the 
 language employed in the contract in question is susceptible of but one 
 
Sec. 5) AGREEMENTS OUSTING THE COURTS OP JURISDICTION 1301 
 
 construction, namely, an attempt on the part of the parties to the same 
 to enter into an independent covenant or agreement to provide for 
 an adjustment of all questions of difference arising between the par- 
 ties by arbitration to the exclusion of jurisdiction by the cotirts. 
 
 Notwithstanding the decisions of the courts of Pennsylvania that 
 the contract as to arbitration was valid and enforceable in that state, 
 judicial comity does not require us to hold that such provision of a 
 contract which is contrary to a declared policy of our courts (White v. 
 Howard, 46 N. Y. 144; Despard v. Churchill, 53 N. Y. 192; Faulkner 
 v. Hart, 82 N. Y. 413, 37 Am. Rep. 574; St. Nicholas Bank v. State 
 Nat. Bank, 128 N. Y. 26, 27 N. E. 849, 13 L,. R. A. 241 ; Marshall V. 
 Sherman, 148 N. Y. 9, 42 N. E. 419, 34 L. R. A. 757, 51 Am. St. Rep. 
 654; Dearing v. McKinnon D. & H. Co., 165 N. Y. 78, 58 N. E. 773, 
 80 Am. St. Rep. 708; Hutchinson v. Ward, 192 N. Y. 375, 85 N. E. 
 390, 127 Am. St. Rep. 909) shall be enforced as between nonresidents 
 of our jurisdiction in cases where the contract is executed and to be 
 performed without this State, and denied enforcement when made and 
 performed within our state. 
 
 As a new trial must be ordered in this case, we conclude that the en- 
 gineer mentioned in the contract in controversy between the parties 
 had reference to the engineer at the time that the several acts were to 
 be performed by such ofificer, and that the decease of the first engi- 
 neer did not prevent his successor from performing all of the obli- 
 gations of the contract to be performed by him. 
 
 The judgment should be reversed, and a- new trial ordered; costs 
 to abide the event. *^ 
 
 Cardozo, J. (concurring). An agreement that all differences aris- 
 ing under a contract shallbe submitted to arbitration relates to the 
 law of remedies, and the law that governs remedies is the law of 
 the forum. In applying this rule, regard rnust be had, not so much 
 to the form of the agreement, as to its substance. If an agreement 
 that a foreign court shall have exclusive jurisdiction is to be condemn- 
 ed (Benson v. Eastern B. & L. Ass'n, 174 N. Y. 83, 66 N. E. 627; 
 Nute V. Ins. Co., 6 Gray [Mass.] 174,, 180; Slocum v. Western Assur. 
 Co. [D. C] 42 Fed. 235; Gough v. Haniburg Am. Co. [D. C-] 158 
 Fed. 174), it is not saved by a declaration that resort to the foreign 
 court shall be deemed a condition precedent to the accrual of a cause 
 of action. A rule would not long survive if it were siibject to be avoid-, 
 ed by so facile a device. Such a contract, whatever form it may 
 assume, affects in its operation the remedy alone. When resort is 
 had to the foreign tribunal for the purpose of determining whether 
 certain things do or do not constitute a breach, the cause of action 
 must in the nature of things, be complete before jurisdicti9n is invok- 
 
 " In accord-: Miles v. Schmidt, 168 Mass. 339, 47 N.E. 115 (1897) ; Ison 
 V. Wright (Ky.) 55 S. W. 202 (1900). See extended note in 47 L. R. A. (N. 
 S.) 337. 
 
1302 ILLEGAL CONTRACTS (Ch. 9 
 
 ed, and cannot be, postponed by the declaration that it shall not be 
 deemed to have matured until: after judgment has been rendered. 
 
 This must be so whether the tribunal is a court or a board of arbi- 
 trators. Indeed, the considerations adverse to the validity of the con- 
 tract are more potent in the latter circumstances, for in the one case we 
 yield to regular and duly organized agencies of the state; and in the 
 other to informal and in a sense irregular tribunals. Mittenthal v. 
 Mascagni, 183 Mass. 19, 23, 66 N. E. 425, 60 t. R. A. 812, 97 Am. 
 St. Rep. 404. In each case, however, the fundamental purpose of the 
 contract is the same — to submit the rights and wrongs of litigants to 
 the arbitrament of foreign judges to the exclusion of our own. Wheth- 
 er such a contract is always invalid where the tribunal is a foreign 
 court we do not need to determine. There may conceivably be excep- 
 tional circumstances where resort to the courts of another state is so 
 obviously convenient and reasonable as to justify our own courts in 
 yielding to the agreement of the parties and declining jurisdiction. 
 Mittenthal v. Mascagni, supra. If any exceptions to the general rule 
 are to be admitted, we ought not to extend them to a contract where 
 the exclusive jurisdiction has been bestowed, not on the; regular courts 
 of another sovereignty, but on private arbitrators. Whether the at- 
 tempt to bring about this result takes the form of a condition preced- 
 ent or a covenant it is equally ineffective. 
 
 A very similar question was involved in Benson v. Eastern Bldg. & 
 L. Ass'n, 174 N. Y. 83, 86, "66 N. E. 627, 628. It was there argued 
 that a provision requiring a trial in a certain county was intended, not 
 as a limitation of the remedy, but as a condition precedent to a cause 
 of action. Cullen^ J., writing for this court, disposed of the point in 
 a few words : "We think this argument proves too much. It is dif- 
 ficult to see why it would not uphold an agreement that all claims 
 against the parties should be determined by arbitrators and not by 
 the courts. It might be said with as much force in such a case as 
 in the one now before us that the cause of action could, under the 
 agreement, accrue only on the decision of the arbitrators. Yet nothing 
 is better settled than that agreements of the character mentioned are 
 void. Greason v. Keteltas, 17 N. Y. 491 ; Prest, etc., D. & H. Canal 
 Co. V. Pennsylvania Coal Co., 50 N. Y. 250. We think the doctrine 
 of the Nute Case, 6 Gray [Mass.] 174, is the true one, that the stip- 
 ulation affects the remedy, not the cause of action." 
 
 Biiilding contracts are made in New York to be performed all over 
 the United States. If the judgment of the court below is to stand, 
 jurisdiction over controversies arising under such contracts may be 
 withdrawn from our courts and the litigation remitted to arbitrators 
 in distant states. The presence of the parties here, the ownership of 
 prxDperty in this jurisdiction, these and other circumstances may make 
 resort to our courts essential to the attainment of justice. If iurisdic- 
 lion is to be ousted by contract, we must submit to the failure of jus- 
 tice that may result from these and like causes. It is true that som.e 
 
Sec. 5) AGREEMENTS OUSTING THE COURTS OP JURISDICTION 1303 
 
 judges have expressed the belief that parties ought to be free to con- 
 tract about such matters as they please. In this state the law has 
 long been settled to the contrary. Sanford v. Commercial Travelers' 
 Mut. Ace. Ass'n, 86 Hun, 380, 33 N. Y. Supp. 512; Id 147 N Y 
 326, 41 N. E. 694; Nat. Contracting Co. v. Hudson R. W P Co 
 i^n ^/J- ^3 ^ N. E. 965. See, also, Miles v. Schmidt, 168 Mass! 
 339, 47 N. E. 115; Fisher v. Merchants' Ins. Co., 95 Me. 486, 50 Atl. 
 282, 85 Am. St. Rep. 428. The jurisdiction of our courts is established 
 ■by law, and is not to be diminished, any more than it is to be increased, 
 by the convention of the parties. 
 I concur with Judge Hogan and vote for reversal." 
 
 GRADY v. HOME FIRE & MARINE INS. CO. 
 
 (Supreme Ciourt of Rhode Island, 1006. 27 R. I. 435, 63 Atl. 173, 4 L R A 
 
 (N. S.) 288.) 
 
 Action by Daniel F. Grady against the Home Fire & Marine, Insur- 
 ance Company. Verdict was rendered in favor of plaintiff, and de- 
 fendant petitioned for a new trial. Granted. 
 
 Johnson. J.*^ The action was upon a policy of fire insurance which 
 contained the following provisions : * * * "in the event of disa- 
 greement as to the amount of loss the same shall, as above provided, be 
 
 *2 In Myers v. Jenkins, 63 Ohio St. 101, 57 N. R. 1089, 81 Am. St. Rep. 613 
 (1900), the plaintiff sued a local lodge of Odd Fellows for sick benefits due. 
 The rules of the society, to which the plaintiff had agreed, required him to 
 seek his "remedy for all rights on account of said membership or connection 
 therewith in the tribunals of the order only, without resorting for their en- 
 forcement in any court or for any purpose to the civil courts". Concerning 
 this the court said : "After a right has accrued or an obligation has been in- 
 curred a party may waive his rights or refuse and neglect to enforce them, 
 or he may by contract bind himself to submit the matter to arbitration or 
 other si^ecial remedy. But a party cannot bind himself by contract in ad- 
 vance to renounce his right to appeal to the courts for the redress of wrongs. 
 If this could be done an association might be formed in the state which would 
 renounce our constitution and laws, and set up' a different system of govern- 
 ment for themselves, and, in case of wrongs and oppression, they would be de- 
 barred from resorting to our courts, and would be compelled to submit to the 
 decisions of their own tribunals, and would most likely become dissatisfied 
 and disorderly, resulting in riot and bloodshed. The whole state has an in- 
 terest in all its Inhabitants, and It is to its interest that the rights of all 
 should be protected and enforced according to the course of jurisprudence it 
 has provided ; and for that reason its courts are always open for the redress 
 of wrongs, and no person can by contract, in advance, deprive himself of the 
 right to appeal to them." 
 
 For cases not altogether in harmony with this, see Fillmore v. Great Camp 
 of Knights of Maccabees, 103 Mich. 437, 61 N. W. 785 (1894) ; Raymond v. 
 Farmers' Mut. Fire InS. Co., 114 Mich. 386, 72 N. W. 254 (1897) ; Robinson 
 V. Templar Lodge No. 17, I. O. O. F., 117 Cal. 370, 49 Pac. 170, 59 Am. St. 
 Rep. 193 (1897) ; President, etc., of Delaware & H. Canal Co. v. Pennsylvania 
 Coal Co., 50 N. Y. 250 (1872) ; Addison C. Burnham in 11 Harvard Law Re- 
 view, 234. See the detailed note in 15 L. R. A. (N. S.) 1055, stating the older 
 and narrower view. 
 
 *s Part of the Opinion is omitted. 
 
1304 ILLEGAL CONTRACTS (Ch. & 
 
 ascertained by two competent and disinterested appraisers, the insured 
 and this company each selecting one, and the two so chosen shall first 
 select a competent and disinterested umpire; the appraisers together 
 shall then estimate and appraise the loss, stating separately sound value 
 and damage, and, failing to agree, shall submit their diiiferences to the 
 umpire; and the award in writing of any two shall determine the 
 amount of such loss. * * * This company shall not be held to have 
 waived any provision or condition of this policy or any forfeiture there- 
 of by any requirement, act, or proceeding on its part relating to the. 
 appraisal or to any examination herein provided for; and the loss 
 shall not become payable until sixty days after the notice, ascertain- 
 ment, estimate, and satisfactory proof of the loss herein required have 
 been received by this company, including an award by appraisers when 
 appraisal has been required. * % * No suit or action on this pol- 
 icy, for the recovery of any claim, shall be sustainable in any court of 
 law or equity until after full compliance by the insured with all the 
 fore^going requirements, nor unless commenced within twelve months 
 next af J:er the fire." 
 
 The property covered by this policy having been destroyed by fire, 
 the parties entered into' an agreement of submission to arbitration, in 
 accordance with the terms of the policy. The arbitrators selected ap- 
 pointed an umpire and proceeded with the appraisal. An award in 
 writing; dated April 23, 1902, was signed by the two arbitrators and 
 the umpire. Subsequently one of the arbitrators erased his name and 
 appended the following memorandum : "Signature erased a/c dis- 
 agreement 5— -27 — '02." The defendant- offered to abide_ by the award, 
 although admitting its insufficiency ; and, its offer in that regard being 
 rejected, demanded a new appraisal and named its arbitrator'. The 
 plaintiff refused to submit to a new appraisal, and subsequently this 
 action was commenced. 
 
 The declaration contained no reference to the arbitration clause of 
 the policy, nor to the attempted arbitration under it. The defendant 
 filed the general issue only.- The parties, however, stipulated that the 
 defendant might, under the general issue, make any defense which it 
 might make under any plea in bar^ of which the defendant should give 
 the plaintiff notice in writing, "and especially the defense that the 
 parties failed to agree as to the amount of loss, and therefore a deter- 
 mination of the amount of loss by appraisers is a condition precedent 
 to the plaintiff's right of action and that no such determinationi has 
 been made." It was admitted by the parties that the award was not in 
 accordance with the provisions of the agreement of submission to ar- 
 bitration, and was invalid. 
 
 The case was tried with a jury in the common pleas division, and at 
 the close of the testimony the defendant moved the court to direct a 
 verdict upon the following grounds: (1) That, upon the evidence, an 
 appraisal in accordance with the terms of the policy is a condition pre- 
 
Sec. 5) AGEBBMBNTS OUSTING THE COURTS OF JURISDICTION 1305 
 
 cedent to the right of the plaintifif to recover. (2) That there having 
 been an agreement for arbitration, and the arbitration having failed 
 without the fault of either party, the plaintifif must comply with the 
 defendant's request for a resubmission before he can maintain his ac- 
 tion. This motion was denied, and the defendant thereupon excepted. 
 The defendant then presented to the presiding justice requests to charge 
 the jury as follows : "(1) By the terms of the policy the determination 
 of the amount of the loss by arbitration is a condition precedent to 
 the plaintiff's right to sue, and, in order to recover, it is incumbent 
 upon the plaintiff either to aver and prove thq determination of the 
 amount of the loss in that manner, or to aver and prove facts which 
 excuse him from procuring such determination by arbitration. (2) 
 Where an attempt has been made by the insured and the company to 
 have the amount of loss determined by arbitration in accordance with 
 the terms of the policy, and the arbitration fails without misconduct 
 on the part of the company, and the company seasonably notifies the 
 assured that it requires arbitration in accordance with the terms of 
 the policy and names an arbitrator, no action will lie against the com- 
 pany until such arbitration shall be had or shall have failed through 
 the misconduct of the company. (3) The notice from the company to 
 the assured that arbitration is required by it and the nomination by 
 the company of an arbitrator as disclosed by the evidence was season- 
 able." The court granted the third of these requests, but refused the 
 first and second requests, and the defendant excepted. The jury re- 
 turned a verdict for the plaintiff for $960.83, and the case is now be- 
 fore us on the defendant's petition for a new trial upon the grounds 
 of the refusal of the presiding justice to direct a verdict for the de- 
 fendant, and his refusal to direct and charge the jury in accordance 
 with the first and second requests above quoted. 
 
 It is well settled, both in this country and in England, that a stipu- 
 lation in a contract providing that all controversies and disputes which 
 may subsequently arise between the pirties shall be settled by arbitra- 
 tion is invaHd because its effect would be to oust the courts of their 
 jurisdiction. It is, however, equally well settled that if the arbitration 
 agreement relates only to some preliminary matter, such as the ascer- 
 tainment and determination of the amount of damages to be recovered, 
 and does not apply to the whole question of Hability, such an agree- 
 ment providing a reasonable and definite method for choosing arbitra- 
 tors is valid and enforceable.** * * * 
 
 " The court here cited Hamilton v. Liverpool, etc., In^ Co., 136 U. S. 242 10 
 Snn nt <)45 34 L Ed. 419 (1890) ; Scott v. Avery, 5 H. L. Oas. 811 (looo) . 
 Spewa L^mter Co V Phenix Ins. Co., 80 Mich. 116, 44 N. W. 1055 (1890) ; 
 
 MsherT Merchants' Ins. Co., 95 Me. 486, 50 t^^'^"' t'L"" V 14 aTi 561 
 (1901) ; Wolff V. Liverpool & L. & G. Ins. Co., 50 N./. Law, 453, 14 Atl. 561 
 (1888 Levine v. Lancashire Ins. Co., 66 Minn. 188, 68 N. W. 855 (189b) , 
 Seibel V Lebanon Mut. Ins. Co., 16 Lane. Law Rev. 356; Westenhaver v. 
 ll™-AmSn Ins. Co.. 113 Iowa, 726 84 N. W. m (1900) ; Viney v^ 
 3ignold, 20 Q. B. D. 172 (188T) ; President, etc., of Delaware & H. Canal Co. 
 
1306 ILLEGAL CONTEAGTS (Ch. 9 
 
 Furthermore, the policy in this case was in the standard form pre- 
 scribed by chapter 183, p. 578 of the General Liws 1896; and,, even if 
 the validity of such a stipulation were less strongly supported by the 
 authorities, it could not well be argued that a contract made in the ex- 
 press terms required by the statute was void as against public policy. ' 
 A provision in a contract that preliminary matters about which differ- 
 ences may arise between the parties shall be determined by arbitration 
 may go to the extent of making such determination a condition pre- 
 cedent to a right of action upon the contract, or may be simply a col- 
 la:teral and independent agreement which will not be a bar to an ac- 
 tion on the principal. contract, but would be a basis for a separate ac- 
 tion in case of breach. 
 
 In Fisher v. Merchants' Ins. Co., 95 Me. 486, 50 Atl. 282, 283, 85 
 Am. St. Rep. 428, the court says: "The general principle is, as de- 
 cided in Roper v. Lendon, 1 El. & El. 825, that such a condition in a 
 contract to refer any question which may arise out of the contract will 
 be, if so stated, a condition precedent to the right to sue on the con- 
 tract; but, unless the condition expressly stipulates that until ar- 
 bitration had no action shall be brought, its performance is not pre- 
 cedent to the right to sue on the contract. * * * ^^^ {^ jg 
 settled beyond controversy that, when the contract provides that 
 no action upon it shall be maintained until after such an award, 
 then the award is a condition precedent to the right of' action." In 
 Hamilton v. I^iverpool, etc., Ins. Co., 136 U. S. 255, 10 Sup. Ct. 949, 
 34 Iv. Ed. 419; Mr. Justice Gray, speaking to this very) point, says: 
 "Such a stipulation, not ousting the jurisdiction of the courts, but 
 leaving the general question of liability to be judicially determined, and 
 simply providing a reasonable method of estimating and ascertaining 
 the amount of the loss, is unquestionably valid, according to the uni- 
 form current of authority in England and in this country. * * * 
 The case comes within the general rule long ago laid down by this 
 court : 'Where the parties, in Rieir contract, fix on a certain mode by 
 which the amount to be paid shall be ascertained, as in the present case, 
 the party that seeks an enforcement of the agreement must show that 
 he has done everything on his part which could be done to carry it into 
 effect. He cannot compel the payment of the amount claimed, unless 
 he shall procure the kind of evidence required by the contract, or show 
 that by time or accident he is unable to do so.' U. S. v. Robeson, 9 
 Pet. (U. S.) 319, 327, 9 L. Ed. 142." 
 
 In the contract before us the parties have stipulated that "the loss 
 ijhall not become payable until sixty days after the notice, apcertain- 
 ment, estimate and satisfactory proof of the loss herein required have 
 
 V. Pennsylvania Coal Co., 50 N. Y. 250 (1872) ; Reed v. "Washington Fire & 
 Marine Ins. Co., 138 Mass. 572, HIQ (1885) ; Hall v. Norwalk Fire Ins. Co., 07 
 Conn. 105, 114, 17 Atl. 356 (1888). See, also, Brown v. Roger Williams Ins. 
 Co., 5 R. I. 394, 401, 402 (1858). American cases are collected in 47 h. R. A. 
 (N. S.) 387, note XVI. 
 
Sec. 5) AGREEMENTS OUSTING THE COURTS OF JURISDICTION 1307 
 
 been received by this company, including an award by appraisers when 
 appraisal has been required," and also that "no suit or action on this 
 policy, for the recovery of any claim, shall be sustainable in any court 
 of law or equity until after full compliance by the insured with all the 
 -foregoing requirements." These provisions clearly constitute a condi- 
 tion precedent to the right of action. Hamilton v. Liverpool, etc., Ins. 
 Co., supra; Fisher v. Merchants' Ins. Co., supra; Hood v. Hartshorn, 
 100 Mass. 117, 1 Am. Rep. 89; Reed v. Washington Ins. Co., supra; 
 Hutchinson v. Ins. Co., 153 Mass. 143, 26 N. E. 439, 10 L,. R. A. 558. 
 Levine v. Insurance Co., 66 Minn. 138, 68 N. W. 855 ; Westenhaver v. 
 Ins. Co., 113 Iowa, 726, 84 N. W. 717. A valid, agreement, therefore, 
 having been made by the parties that in case of loss no action shall be 
 sustainable until the amount of loss has been first ascertained in the 
 manner provided in the policy, the question arises whether the attempt- 
 ed arbitration, which it is admitted failed without the fault of the de- 
 fendant, was such a compliance with the contract as will permit the 
 plaintiff to maintain this action, which is brought to recover, not the 
 award contemplated by the contract, but such loss or damage as he has 
 sustained irrespective of the award. We think that it clearly is not. 
 If the arbitration had failed through the fault of the defendant, the 
 case would be different. There is, however, no allegation that the de- 
 fendant was at fault in the matter or that arbitration had become im- 
 possible. This very question was decided in Fisher v. Merchants' Ins. 
 Co., 95 Me. 486, 50 Atl. 282, 85 Am. St. Rep. 428." * * * 
 
 The I cases rehed on by the plaintiff do not support his contention. 
 Those which are in point clearly recognize the distinction between a 
 collateral and independent provision for arbitration and one which 
 makes an award a condition precedent to the right of maintaining an 
 action upon the contract. In Pepin v. Societe St. Jean Baptiste, 23 R. 
 I. 84, 49 Atl. 387, 91 Am. St. Rep. 620, the by-law under consideration 
 required every contestation between the society and a member to be 
 referred to a committee whose decision should be final. Such a con- 
 tract is clearly invalid as ousting the courts of their jurisdiction, and 
 was so held. In Stephenson v. Piscataqua F. & M. Ins. Co., 54 Me. 55, 
 the court clearly recognized the distinction made by the authorities, 
 saying (page 70) : "While parties may impose as a condition prece- 
 dent to application to the courts that they shall first have settled the 
 amount to be recovered by an agreed mode, they cannot entirely close 
 the access to the courts of law." Chippewa Lumber Co. v. Phenix Ins. 
 Co. is clearly in point, and supports our conclusion. We have cited 
 it, supra. In passing upon an arbitration provision, substantially like 
 the one in the case at bar, the court says (page 121 of 80 Mich., page 
 1056 of 44 N. W.) : "Plaintiff and defendant deliberately agreed to 
 this method of ascertaining the damages. * * * They deliberately 
 provided a penalty for failure to comply with this obligation. If plain- 
 
 *^ The court's discussion of this point is omitted. 
 
1308 ILLEGAL CONTRACTS (Ch. 9 
 
 tiff refused compliance, then it could not bring suit. If defendant re- 
 fused compliance, then suit could be brought against it immediaCtely. 
 We hold the agreement reasonable and legal. It is sustained by the 
 clear weight of authority." , . 
 
 In I^iverpool, etc., Ins. Co. v. Creighton, 51 Ga. 95, the court, speak- 
 ing of such a stipulation, says (page 1 10) it does not bar the insured 
 of his right of action without such reference, "unless the stipulation 
 amounts to a condition precedent to his right to resort to the courts) 
 or makes such submission the only mode by which the amount of dam- 
 age is to be ascertained, or by which the liabiHty of the company can be 
 fixed. Either of these two latter provisions would, at last, be equivalent 
 to making the submission a condition to be performed before suit." 
 In Reed v. Washington Ins. Co., supra, the court say of the provision 
 in the policy before it (pages 576, 577 of 138 Mass) : "And it is sim- 
 ply an agreement to refer that matter to arbitration, without any agree- 
 ment by the plaintiff not to sue. There is nothing to bring it within 
 any of the cases in which a provision to refer has been held to be a 
 condition, such as Scott v. Avery * * * in England, and Hood v. 
 Hartshorn, ubi supra, in this commonwealth." In Mutual Fire Ins. 
 Co. V. Alvord, 61 Fed. 752, 9 C. C. A. 623, the court says (61 Fed. 755, 
 9 C. C. A. 626): "It is undoubtedly true that a poficy of insurance 
 may contain a valid provision which prohibits the insured from main- 
 taining an action until the amount of loss shall have been first submitted 
 to arbitration, and ah award shall have been made. In such a case the 
 determination of the amount by arbitration is recognized as a condition 
 precedent to the right to bring suit. * * * But, in order to make 
 such award a condition precedent to the right of maintaining suit, it 
 must be so expressed in the policy or necessarily implied from its terms. 
 A mere provision in the policy that the amount to be paid, in case of 
 disagreement, shall be subrnitted to arbitration, does not prevent the 
 insured from fnaintaining an action, unless the policy further provides 
 that no action shall be maintained until after award. * * * There 
 is nothing in the terms of this policy which expressly or by implica- 
 tion forbids the insured from bringing suit until after the amount of 
 loss has been submitted to arbitration and an award has been made, 
 and therefore we must consider the provisions in the policy relating to 
 this subject as constituting a collateral and independent agreement, and 
 not one which was a condition precedent to the right of maintaining art 
 action." 
 
 The plaintiff argues that, in accordance with the general rule, the 
 agreement is revocable at any time before an. award is made. That, 
 however, does not help the plaintiff. A revocation of the authority of 
 the arbitrators would only stop the proceedings under that arbitration. 
 The provision of the policy requiring an award as a condition prece- 
 dent to a right of action would still be in force. The revocation, there- 
 fore, would only make it necessary to begin the arbitration anew. An 
 
Sec. 5) AGREEMENTS OUSTING THE COURTS OF JURISDICTION 1309 
 
 award by arbitration having been made by the policy a condition pre- 
 cedent to the right of action, it was incumbent on the plaintiff to allege 
 and prove such award ; or, if the award was invalid, then to allege and 
 prove either that the amount of loss had been determined by other ar- 
 bitrators selected according to the provisions of the policy, or that for 
 some valid reason such determination had become unnecessary or im- 
 possible. 
 
 The request that a verdict be directed for the defendant should have 
 been granted. And when the case was given to the jury the instruc- 
 tions requested should have been given. 
 
 Defendant's exceptions sustained. Petition for new trial granted. 
 Case remitted to the superior court, with direction to enter judgment 
 for the defendant.** 
 
 LIVINGSTON V. RALLI. 
 (In the Queen's Bench, 1855. 5 El. & Bl. 132.) 
 
 Count that, by a contract, plaintiff agreed to buy of defendant, and 
 defendant to sell to plaintiff, a cargo of wheat, on certain terms men- 
 tioned in the contract, "and that, should any difference arise as to that 
 contract, the same should be left to arbitration in L,ondon, in the usual 
 manner; that is to say the arbitration of two London corn factors, 
 one to be chosen by plaintiff and the other by defendant, or an umpire 
 to be chosen by such arbitrators in case of difference." Averment that 
 the cargo of wheat arrived, and was accepted, and the price paid by 
 plaintiff to defendant according to the agreement, and that a difference 
 thereupon and before this suit arose between plaintiff and defendant 
 as to the said contract, which difference ought to have been left to 
 arbitration in manner so agreed as aforesaid. General averment of 
 performance by plaintiff and of lapse of reasonable time for appointing 
 an arbitrator. Breach : that defendant refused to concur with plain- 
 tiff in referring the said difference, or procuring it to be disposed of 
 by arbitration in the usual manner, and wrongfully hindered and 
 prevented its being so left or disposed of. * * * 
 
 Lord Campbeli,, C. J.*^ I have a- very great respect for the doubts 
 of Lord Eldon; and he seems, in Tattersall v. Groote, 2 B. & P. 131, 
 to doubt much whether such a contract as the present was not 3lto- 
 
 *8 If arbitration is not expressly made a condition precedent, it will seldom 
 be held to be one by implication or construction. Aktieselskabet Korn-og 
 Foderstof Kompagniet v. Rederiaktlebolaget Atlanten, 250 Fed. 935, 163 C. 
 0. A. 185, Ann. Cas. 1918E, 491 (1918) ; North America Dredging Co. of Ne- 
 vada V. Outer Harbor Dock & Wharf Co., 178 Cal. 406, 173 Pac. 756 (1918) ; 
 Hamilton v. Home Ins. Co., 137 U. S. 370, 11 Sup. Ct. 133, 34 L. Ed. 708 (1890) ; 
 Hill V. More, 40 Me. 515 (1855) ; Miles v. Schmidt, 168 Mass. 339, 47 N. E. 
 115 (1897) ; Haggart v. Morgan, 5 N, Y. 422, 55 Am. Dec. 350 (1851). 
 
 ^'' The statement of facts and the opinions are omitted in part. Erie ana 
 Crompton, JJ., concurred. 
 
1310 ILLEGAL CONTRACTS (Ch. 9 
 
 gether nugatory ; but I cannot bring myself to doubt that on principle, 
 an action lies on it. There is a sufficient consideration to support 
 any promise; and there is an express promise to refer any disputes 
 that may arise. Why should not such a promise be binding, and one 
 for the breach of which an action would lie? Can it be said that such 
 an agreement is void as being immoral, or as contrary to public policy? 
 It seems to me, on the contrary, that it is a very judicious and proper 
 arrangement, and that it would be a strange restriction on the liberty of 
 the subject if parties could not make such an agreement if they please. 
 
 Then, as to the authorities. It certainly seems that, in Tattersall v. 
 Groote, 2 B. & P. 131, Lord Eldon expressed much doubt; but neither 
 in that case nor in any other was there a decision that an action could 
 not be maintained on such an agreement : and ever since I have known 
 Westminster Hall at least, the opinion of the profession has been that, 
 though such a prospective agreement of reference could not bar an 
 action in the Courts of law, yet an action was maintainable for the 
 breach of it. There seems at one time to have prevailed in pur Courts 
 a horror of a domestic forum which I can neither sympathise with 
 nor account for; but the Legislature has recently, in The Common 
 Law Procedure Act, 1854 (17 & 18 Vict. c. 125) sect. 11, made a 
 provision in -such cases, not that the agreement to refer shall be plead- 
 able in bar, but that the Court may stop the action. This shews the 
 opinion of the Legislature that such agreements are not contrary to 
 public policy. For these reasons I entertain no doubt that the action 
 lies.*^ * * * 
 
 Coleridge, j, * * * ^he fallacy of the argument consists in 
 confounding two separate cases ; one where the defendant relies on 
 such an agreement as a bar to an action, a defence which, if success- 
 ful, would oust the Court of its jurisdiction; the other, which is 
 the present case, where the plaintiff seeks damages for not fulfilling 
 the agreement. It is said that the damages in such a case can be only 
 nominal: supposing it were so, that would not bar the action: but 
 it seems to me very difficult to maintain that the damages in such a 
 case may not be substantial. * * * . 
 
 *8 In accord: Pond v. Harris, 113 Mass. 114 (1873), agreement to arbitrate 
 certain existing disputes; Vynior's Case, 8 Co. 81b (1610), bond forfeited for 
 wrongfully revoking the arbitration; Warburton v. Storr, 4 B. & C. 102 
 (1825), same; Miller v. President, etc., of Junction Canal Co., 53 Barb. (N. 
 Y.) 590 (1868). See further 47 L. R. A. (N. S.) 408, note XIX. 
 
 Arbitration agreements are not specifically enforced in equity. Milnes v. 
 Gery, 14 Ves. Jr. 400 (1807) ; note In 47 L. E. A. (N. S.) 364. But by statute 
 a remedy of this sort exists. Belfield v. Bourne, [1894] 1 Ch. 521, 69 L. T. 786 ; 
 California Academy of Sciences v. Fletcher, 99 Cal. 207, 33 Pac. 855 (1893). 
 
 Courts of equity have occasionally decreed specific performance q1 leasing 
 contracts, where the rent to be paid was to be fixed by arbitration, but the 
 court itself then assumes the role of arbitrator. Houston v. Bamett, 90 Or. 
 94, 175 Pac. 619 (1918) ; B;aufmann v. Liggett, 209 Pa. 87, 58 Atl. 129, 67 
 li. R. A. 353, 103 Am. St. Rep. 988 (1904) ; Kelso v. Kelly, 1 Dalv (N. Y.) 
 419 (1860) ; Gregory v. Mighell, 18 Ves.. 328 (1811) ; Johnson v. Conger, 14 
 Abb. Prac. (N. Y.) 195 (1861). 
 
Sec. 5) AGREEMENTS OUSTING THE COURTS OF JURISDICTION 1311 
 
 NORCROSS V. WYMAN. 
 (Supreme Judicial Court of Massachusetts, 1904. 187 Mass. 25, 72 N. E. 347.) 
 
 Action by O. W. Norcross against H. Wyman. Judgment entered 
 in accordance with an arbitrator's report in favor of plaintiff. Case 
 reported. Judgment for plaintiff. 
 
 BralEy, J. Under the contract, which incUided the specifications 
 and plans, the plaintiff was required to provide a suitable foundation 
 for the building to be erected, but the nature of the soil to be excavated 
 was such that more work was ultimately required for this purpose than 
 he originally anticipated. It is his contention that this work is not 
 covered by the contract, and that he is entitled to extra compensation 
 for its performance. By the specifications it was provided that : "The 
 architects shall have the sole interpretation of their drawings and 
 these specifications, except as otherwise provided or specified. Their 
 decision upon all questions relative to drawings, specifications, or 
 contract for the said building shall be final, and binding upon the 
 owner and contractor." While putting in the foundation the plaintiff 
 discovered a quicksand, and asked the architects subject to whose 
 supervision the work was being done for instructions. Upon the 
 evidence before him, the arbitrator finds as a fact that the architects 
 decided that the clause in the specifications relating to the excavation 
 required was not inserted with the intent that the expense of the work 
 made necessary by the quicksand should be borne by the plaintiff, 
 as this circumstance was unforeseen by him or them, and that the ex- 
 tra work so caused was not included within the terms of the contract. 
 If the architects were clothed with authority to make this decision, it 
 is conclusive between the parties. The clause which defined their pow- 
 ers and duties was contained in a contract under seal, voluntarily en- 
 tered into by the parties, and provided a simple and convenient method 
 for the settlement of any questions that, as the work proceeded, might 
 arise over the interpretation of the contract or of the drawings and 
 specifications. Or, in other words, whenever it became necessary, 
 whether for the information of the plaintiff, who had stipulated to 
 • work under their direction, or for the benefit of the defendant in se- 
 curing a strict compliance with the terms of the contract, it was left 
 to the architects to finally determine what their drawings and specifica- 
 tions covered as to the quantity and quality of the work that was re- 
 quired to be done by the plaintiff. In the practical working of this 
 plan of supervision and adjustment of differences the cumbersome 
 formalities of a notice to or a hearing of the parties before making 
 decision were evidently not contemplated, as such a requirement is 
 not found in any provision of the contract. Neither was it required by 
 the character of the undertaking. For the purposes of their decision 
 they were free to adopt such legal principles as they honestly believed 
 applicable, and to act on such evidence as they chose to receive. Boston 
 
1312 ILLEGAL OONTKACTS (Ch. 9 
 
 Water Power Co. v. Gray, 6 Mete. 1^1, 169; Flint v. Gibson, 106 
 Mass. 391, 395. 
 
 Although the defendant, when notified, declined to, be bound by their 
 award, this action was taken after it had been communicated to the 
 plaintiff, and, if it is treated as an attempt to formally revoke the 
 power previously given, it came too late. Wallis v. Carpenter, 13 
 Allen. 19, 24. Besides, his attempted rescission would not work a 
 revocation of the authority of the architects, for this was conferred 
 by one part of an agreement, which as a whole he was not entitled 
 to rescind. Haley v. Bellamy, 137 Mass. 357, 359. It does not become 
 important to decide how far an agreement for the arbitrament of the 
 construction of a written contract, or of the quantity and value of 
 work to be performed under it, could be effectually pleaded in bar 
 to a suit on the contract itself, or enforced by a bill in equity for 
 specific perfonnance. Miles v. Schmidt, 168 Mass. 339, 340, 47 N. 
 E. 115. Not only had the decision been made, but the question de- 
 cided, if not treated as technically submitted to them as arbitrators, 
 was one which the parties could leave to the determination of the 
 architects. Palmer v. Clark, 106 Mass. 373; Robbins v. Clark, 129 
 Mass. 145 ; McMahon v. New York & Erie Railroad Company, 20 
 N. Y. 463, 465; Omaha v. Hammond, 94 U. S. 98, 24 L. Ed. 70. 
 See White v. Middlesex Railroad, 135 Mass. 216, 220, and cases cited. 
 Compare Smith v. Boston, Concord & Montreal Railroad, 36 N. H. 458 
 489, 490. The arbitrator, therefore, correctly ruled that the archi- 
 tects were authorized to act on the question submitted to theim, and 
 their decision thereon was binding on the defendant. As the_award can 
 well rest on this ground, it becomes of no consequence tp consider 
 whether the contract, fairly construed, required the plaintiff to ex- 
 cavate through the quicksand, although on this question the arbitrator 
 ruled in his favor. See Stuart v. Cambridge, 125 Mass. 102. 
 
 Award of the arbitrator accepted for the full amount, and judgment 
 ordered thereon for the plaintiff.** 
 
 ** The decision of an architect or engineer or the award of an arbitrator, 
 when once properly made, is final, if such was the agreement of the parties ; 
 and this is true, irrespective of the question whether the courts were ousted of • 
 jurisdiction prior to the decision or award. MayOr and City Council of Bal- 
 timore City Y. M. A. Talbott Co. of Baltimore City, 133 Md. 226, 105 Atl. 149 
 ■ (1918) ; Adinolfi v. Hazlett, 242 Pa. 25, 88 Atl. 869, 48 L. R. A. (N. S.) 885 
 (1913) , holding unconstitutional a statute forbidding such agreements ; Marsch 
 V. Southern New England R. Corporation, 280 Mass. 483; 120 N. E. 120 (1918) ; 
 Keachie v. Starkweather Drainage Dist., 168 Wis. 298, 170 N. W. 286 (1919) ; 
 N. P. Sloan Co. v. Standard Chemical & Oil Co., 256 Fed. 451, 167 O. C. A. 579 
 (1918) ; Benbow v. Jones, 14 M. & W. 198 (1845). 
 
 An agreement that an architect's decision shall be final differs from an or- 
 dinary arbitration, in that no formal hearing or notice is necessary, no con- 
 troversy or dispute is necessary prior to the decision, and the power of the 
 architect is not revocable. Palmer v. Clark, 106 Mass. 873 (1871) ; Boettler 
 V. Tendick, 73 Tex. 488, 11 S. W. 497, 5 L. R. A. 270 (1889) ; Hathawav v. 
 Stone, 215 Mass. 212, 102 N. E. 461 (1913), architect a "quasi arbitrator"; 
 
'^^*^- ^^ CONTRACTS AFFECTING MAEEIAGB 1313 
 
 SECTION 6.-CONTRACTS AFFECTING MARRIAGE 
 
 LOWE V. DOREMUS. 
 
 (Court of Errors and Appeals of New Jersey, 1913. 84 N. J. Law 658 87 Atl 
 459, 49 L. R. A.; [N. S.] 632.) > - 
 
 Action by May Lowe against Cornelius Doremus, executor, etc. 
 Judgment for plaintiff, and defendant brings error. Reversed. 
 
 This suit was brought to recover the sum due on a promissory note 
 made by Henry Van Riper, during his lifetime, of which the follow- 
 ing is a copy : 
 
 "Paterson, N. J., August 28, 1909. 
 "Thirty days after death, I promise, or authorize my executor or 
 administrator, to pay to the order of May Wood, the sum of three 
 
 American-Hawaiian Engineering & Construction Co. v. Butler, 165 Cal 497 
 513, 133 Pac. 280, Ann. Gas. 1916C, 44 (1913). "It is not, strictly speaking a 
 common-law award." 
 
 New York Arbitration Statute. — In Herman Berkovitz v. Arbib & Houlber? 
 130 N. B. 288 (1921), Cardozo, J., said: ' 
 
 "Section 2 of the statute (Laws 1920, c. 275; Consol. Laws, c. 72) declares 
 a new public policy, and abrogates an ancient rule. 'A provision in a written 
 contract to settle by arbitration a controversy thereafter arising between the 
 parties to the contract, or a submission hereafter entered into of an existing 
 controversy to arbitration pursuant to title 8 of chapter 17 of the Code of 
 Civil Procedure, shall be valid, enforceable and irrevocable, save upon such; 
 grounds as exist at law or in equity for the revocation of any contract.' 
 Arbitration Law, § 2. * * * 
 
 "We think there is no departure from constitutional restrictions in this 
 legislative declaration of the public policy of the state. The ancient rule, 
 with its exceptions and refinements, was criticized by many judges as anom- 
 alous and unjust. President, etc., of Delaware & H. Canal Co. v. Pennsylvania 
 Coal Co., 50 N. Y. 250, at page 258 (1872) ; Pudickar v. Guardian Mutual Life 
 Ins. Co., 62 N. Y. 392, 399 (1875) ; United States Asphalt Refining Co. v. 
 Trinidad Lake Petroleum Co. (D. C.) 222 Fed. 1006 (1915), and cases there 
 cited. It was followed with frequent protest in deference to early precedents. 
 Its nold even upon the common law was hesitating and feeble. We are now 
 asked to declare it so imbedded in the very foundations of our jurisprudence 
 and the structure of our courts that nothing less than an amendment of the 
 Constitution is competent to change it. We will not go so far. The judges 
 might have changed the rule themselves if they had abandoned some early 
 precedents as at times they seemed inclined to do. They might have whittled 
 it down to nothing, as was done indeed in England, by distinctions between 
 promises that are collateral and those that are conditions. Scott v. Avery, 5 
 H. L. Cas. 811 (1856) ; London Ttamways Co. v. Bailey. L. R. 3 Q. B. D. 217, 
 221 (1877) ; Spackman v. Plumstead District Board of Works, L. K. 10 App. 
 Cas. 229 (1885) ; Trainor v. Phoenix Assur. Co., 65 L. T. Rep. 825 (1892). 
 No one would have suspected that In so doing they were undermining a juris- 
 diction which the Constitution had charged them with a duty to preserve. Not 
 different is the effect of like changes when wrought by legislation. Alexander 
 V. Bennett, 60 N. Y. 204, 206, 207 (1875)." 
 
 CORBIN CONT 83 
 
1314 : ILLEGAL CONTHACTS (Ch._9 
 
 thousand ($3,000) dollars at the First National Bank of Paterson. Val- 
 ue received. Henry Van Riper. 
 
 "Witness: James F. Carroll, ' 
 
 "Indorsements : 
 
 "May Wood. 
 "May Lowe." 
 
 May Lowe is the married name of the plaintiiBf. 
 
 In answer to the interrogatories presented to the plaintiff she stated 
 that the consideration for the making and delivery of the note was 
 "continuing and staying in the employ of, and not marrying until 
 after the death of the maker, Henry Van Riper, and attending to and 
 caring for the wants of said Henry Van Riper until his death." 
 
 At the close of the testimony, defendant's counsel moved for the 
 direction of a verdict upon the ground, inter alia, that the contract 
 sued on was in general restraint of marriage and void as against pub- 
 lic policy. The trial court denied the motion, and of its own motion 
 directed a verdict for the plaintiff and allowed an exception to the 
 defendant who assigns error thereon. 
 
 Garrison, J. (after stating the facts as above). It was an error to 
 direct a verdict for the plaintiff, and ii was likewise error to refuse to 
 direct a verdict for the defendant. 
 
 The contract sued on was in general restraint of marriage, and con- 
 sequently void. In Sterling v. Sinnickson, 5 N. J. Law, 871, *756, the 
 action was on a sealed bill, the maker of which promised to pay $1,000 
 to the payee provided he (the payee) was not lawfully married in the 
 course of six months from the date thereof. 
 
 It was held that the agreement was void. 
 
 The grounds of this decision as stated by Chief Justice Kirkpatrick 
 was that the law regards marriage as at the foundation of the social 
 order, and hence removes out of the way every unreasonable restraint 
 upon it; and that a restraint "upon the freedom of choice and of ac- 
 tion in a case where the law wills that all shall be free" is an unrea- 
 sonable restraint as against public policy. 
 
 That case is not so strong as this, for there the sealed bill implied a 
 legal consideration, and the restraint was for but six months, whereas 
 here the consideration that had to be proved was a restraint of indef- 
 inite duration. 
 
 This early New Jersey case is cited in the note to Lowe v. Peers, in 
 6 Eng. Ru. Cas. 347, where the English and American authorities are 
 collected. 
 
 The trial judge was influenced by the argument that the considera- 
 tion of the note was severable into three distinct undertakings, the 
 performance of any of which would constitute a good consideration. 
 This clearly is not so. The consideration was the services of an un- 
 married woman, who was to continue as such during the term of her 
 employment. If the plaintiff had married the day after she got the 
 note she could not, by merely tendering her services as a married wo- 
 
^^'^■^) CONTRACTS AFFECTING MAEEIAGB 1315 
 
 man, have maintained an action upon the note, if such services were 
 dechned by the maker thereof. 
 
 Whether it was not in any event a question for the juiy whether 
 the note had m fact the consideration sworn to by the plaintiff or 
 whether it was not an attempted testamentary gift is not now before 
 us m view of our decision of the more fundamental question. 
 
 The record before us not being such that a final judgment can be 
 entered upon it, the judgment below is reversed, and a venire de novo 
 awarded. ^^ 
 
 BOWDEN V. BOWDEN. 
 
 (Supreme Court of California, 1917. 175 Cal. 711, 167 Pae. 154, LEA 
 
 1918A, 380.) 
 
 Action by Ottillie K. Bowden against Rolandus F. Bowden. From 
 judgment for plaintiff and an order denying tiew trial, defendant ap- 
 peals. Judgment and order affirmed. 
 
 Henshaw, J. Differences had arisen between Ottillie K. Bowden, 
 plaintiff herein, and Rolandus P. Bowden, defendant herein, which 
 resulted in an action for divorce commenced by the wife against her 
 husband in October, 1909. At the time they held community interests 
 in property, real and personal. While this action was pending, on No- 
 
 5" Promises and conditions directly in restraint of marriage are void and 
 unenforceable. Lowe v. Peers, 4 Burr. 2225 (1768) ; Sterling v. Sinnicksbn, 
 5 N. J. Law, 756 (1820) ; Chalfant v. Pay ton, 91 Ind. 202, 46 Am. Hep. 586 
 (1883). It does not follow from this, however, that such a provision invali- 
 dates the other terms of a contract. The void promise not to marry is itself 
 inoperative as a consideration ; but it is often held that a return promise is 
 enforceable, if there is another sufiBcient consideration. Forbearance to 
 marry is not in itself illegal ; so that where substantial service has been ren- 
 dered as a consideration, and forbearance to marry has been fuljQlled as a 
 condition, a return promise to pay has been enforced. King v. King, 63 Ohio 
 St. 363, 59 N. E. Ill, 52 L. K. A. 157, 81 Am. St. Rep. 635 (1900) ; Fletcher v. 
 Osbom, 282 111. 143, 118 N. E. 446, L. R. A. 1918C, 331 (1917) ; Crowder-Jones 
 v. Sullivan, 9 Ont. L. R. 27, 4 Ann. Cas. 729 (1904). Of. McCoy v. Flynn, 169 
 Iowa, 622, 151 N. W. 465, L. R. A. 1915D, 1064. 
 
 Contracts for a separation of husband and wife, to take place in the future, 
 are void. Stratton v. Wilson, 170 Ky. 61, 185 S. W. 522, Ann. Cas. 1918B, 
 917 (1916). 
 
 Contracts not to contest a divorce suit are frequently held illegal. Bergevin 
 V. Bergevin, 168 Wis. 466, 170 N. W. 820 (1919) ; Lanktree v. Lanktree (Cal. 
 App.) 183 Pac. 954 (1919) ; Edleson v. Edleson, 179 Ky. 300, 200 S. W. 625, 
 2 A. L. K. 689 (1918), but a contract between husband and wife, already liv- 
 ing apart, for division of property and care of children, is valid ; Klampe v. 
 Klampe, 137 Minn. 227, 163 N. W. 295 (litl7), contract to facilitate divorce; 
 Schley v. Andrews, 225 N. T. 110, 121 Nr E. 812 (1919), payment to wife to 
 induce her to obtain divorce. 
 
 Agreements fixing alimony to be paid are valid, if not for the purpose of 
 facilitating divorce. Maisch v. Maisch, 87 Conn. 377, 87 Atl. 729 (1913) ; 
 Palmer v. Fagerlin, 163 Mich. 345, 128 N. W. 207 (1910). 
 
 Marriage brokage contracts are illegal. Duval v. Wellman, 124 N. Y. 156, 
 26 N. E. 343 (1891) ; Morrison v. Rogers, 115 Cal. 252, 46 Pac. 1072, 56 Am. 
 St. Rep. 95 (1896) ; Hermann v. Charlesworth, [1905] 2 K. B. 123, 93 L. T. 
 284; In re Grobe's Estate, 127 Iowa, 121, 162 N. W. 804 (1905). 
 
1316 ILLEGAL CONTEAOTS (Ch. 9 
 
 vember 4, 1909,' the spouses entered into an agreement whereunder the 
 community property was divided between them. The wife agreed 
 to disinis's the pending action for divorce and together . they agreed 
 as follows: 
 
 "The undersigned, Rolandus F. Bowden, does hereby promise to pay 
 his wife, Ottillie K. Bowden, the sum of three thousand dollars, should 
 he at any time in the future cruelly treat, abandon, desert, or cease 
 to live with the said Ottillie K. Bowden, as husband and wife, or do any 
 other act which would be a cause for a divorce ; the three thousand dol- 
 lars to be due and payable on the date of any such cruel treatment, 
 desertion, or abandonment on the part of Rolandus F. Bowden of his 
 wife to take place or when he should commit any act giving her cause 
 for a divorce : Provided, however, that no part of this sum shall be 
 paid to the said Ottillie K. Bowden should she cruelly treat, desert, or 
 abandon or cease to live with the said Rolandus F. Bowden or do any 
 other action which would be a cause for a divorce." 
 
 Thereafter, on the 13th day of May, 1910, the wife commenced a sec- 
 ond action for divorce against her husband upon the ground of cruelty. 
 The husband defaulted, an interlocutory decree in favor of the wife, 
 was entered, and it became final on March 18, 1912. Thereafter, on 
 February 13, 1913, the wife commenced this action, demanding pay- 
 ment of $3,000 under the written agreement above set forth. The 
 husband answered, the cause was tried, judgment was entered for 
 plaintiff, and the husband has appealed. 
 
 Upon the appeal the single proposition urged is that a contract such 
 as this is against the policy of our law under the decisions of this and 
 other courts. The California cases upon which reliance is placed are 
 Loveren v. Loveren, 106 Cal. 509, 39 Pac. 801, and Pereira v. Pereira, 
 156 Cal. 1, 103 Pac. 488, 23 L. R. A. (N. S.) 880, 134 Am. St. Rep. 
 107. Loveren v. Loveren is not even remotely in point. There the 
 agreement between the spouses was in the nature of a collusive ar- 
 rangement, based upon a division of the community property, under 
 which it was to be made easy for one of the spouses to secure a divorce 
 from the other, and this court very properly declared that "the author- 
 ities are uniform in holding that any contract between the parties hav- 
 ing for its object the dissolution of the marriage contract, or facilitating 
 that- result, * * * is void as contra bonos mores." 
 
 In the Pereira Case, while the facts are somewhat different, the 
 principle controlling the construction of the agreement is, and is said 
 to be, the same as that declared and above quoted from Loveren v. 
 Loveren. The wife had brought her action for a divorce upon the 
 ground of extreme cruelty against her husband. While the action was 
 pending the parties became reconciled and resumed marital relations. 
 Then on a certain date, in pursuance of negotiations which were pend- 
 ing, they entered into a contract which recited the pendency of the 
 action for , divorce, declared an express waiver by plaintiff of her 
 
Sec. 6) CONTRACTS AFFECTING MARRIAGE 1317 , 
 
 gi-ounds of divorce and an agreement to dismiss tlie action, and it then 
 proceeded to declare : "That if the husband should thereafter so con- 
 duct himself as to give the wife a new cause of action for divorce, 
 and she should establish the same in a subsequent action against him, 
 * * * the husband should thereupon pay to the wife $10,000, which 
 should be a full satisfaction, settlement, and discharge of all claims 
 of the wife in such action 'for alimony, costs, counsel fees, support, 
 maintenance of herself, homestead, homestead right, property, and ben- 
 efit of every kind and character ;' " still further, that the wife (regard- 
 less of any increase in the fortune of tlie husband) waived, abandoned, 
 and relinqviished all claims and demands by her on her part in or to any 
 or all of the husband's property or property rights, whether then owned 
 or thereafter acquired. 
 
 The opinion points out, amongst other things, that this amount was 
 wholly disproportionate to the value of the husband's fortune, that for 
 certain grounds of divorce the wife could justly be awarded much more 
 than the $10,000, and that the existence of such a contract could not 
 be a deterrent to the husband from violating his marriage vows and 
 giving his wife cause for divorce, but would only "encourage him to 
 yield to his baser inclination and inflict the injury." Wherefore, says 
 this court, quoting from Loveren v. lyOveren, supra: "Any contract 
 between the parties having for its object the dissolution of the marriage 
 contract, or facilitating that result, * * * jg yoid as contra bonos 
 mores." Of exactly the same character is the case of Newman v. 
 Freitas, 129 Cal. 283, 61 Pac. 907, 50 L. R. A. 548, which therefore 
 calls for no more than this mention. 
 
 Manifestly, then, these cases cannot be successfully invoked to defeat 
 the contract here before us ; for precisely what, in its essence, is this 
 contract? Postnuptial differences had arisen between the spouses 
 which had resulted in an action for divorce brought by the wife against 
 the husband. They were the owners of community property, real and 
 personal. The husband sought a reconciliation, and it was accorded 
 him. The law favors such reconciliation, unless it be effected upon 
 terms expressly forbidden or upon terms expressly disapproved, or, 
 in other words, unless the term be against the express mandate of the 
 law or against public policy. Did the wife in this contract surrender 
 any of her marital rights? None whatever. Did she in any way make 
 it easier for her husband to inflict on her any marital wrongs? Not m 
 the least. Did she extend, actually or impliedly, any inducement to 
 him to commit such wrongs, either upon the theory that she would 
 get a divorce because of them, or that he would be less mulct finan- 
 cially than, saving for the contract, he would be (which is the Pereira 
 Case) if he did commit such wrongs? Nothing of this appears m the 
 contract. In brief, what the contract does do is to reserve to the wife 
 without impairment all of her marital rights, to reserve to the hus- 
 band without impairment all his marital rights, to waive upon the 
 part of neither their legal or equitable rights for any wrong which ei- 
 
1318 ILLEGAL CONTEAOTS (Ch. 9 
 
 ther might commit against the marriage status, but simply to impose 
 upon the husband the duty, in addition to that which the law imposes, 
 of observing his marital vows and obligations, or, failing to do so, to 
 pay to the mistreated wife something in addition to that which the law 
 would award her in her action based upon such mistreatment either 
 for divorce or for separate maintenance. It is impossible to read this 
 contract in any other light. So far from the consideration being 
 base, it is worthy and commendable. It neither asks nor invites the 
 husband, to do a wrong. It endeavors to deter him from doing wrong 
 by making him liable to a penalty in addition to that imposed by law 
 if he does do wrong. ' ' - < 
 
 On principle, therefore, we hold that neither the consideration nor 
 the purpose of this contract is base, but that 'both are worthy, and 
 that, whatever may be said touching the invalidity for lack of consid- 
 eration only of such a contract, if it be an antenuptial contract, it is 
 not without consideration where a wife has suflfered such wrongs 
 from her husband and has condoned his offenses, has resumed with 
 him the marriage relation, and re-established the marriage status, all 
 of which the law favors, upon condition, not improperly' imposed by 
 virtue of sad experience, that he shall not again offend. Such a wife 
 had found the legal obligation to be insufficient. It would indeed be 
 a harsh rule which after such an experience should say that she may 
 not invoke other aids in her efforts to induce her husband thereafter 
 to remain true to his marriage vows. The cases that hold that an 
 antenuptial agreement to this effect is without ' consideration are based 
 upon the view that at the outset of the relationship the law itself 
 imposes the prescribed duty upon both spouses, and that therefore there 
 is no consideration where one spouse agrees that if he does offend in 
 the future he will pay a penalty in addition to that which the law may 
 exact. We need not discuss nor even collate these cases, as they are 
 not addressed to' the situation here before us. 
 
 But, upon the other hand, cases which are addressed to the situation 
 here presented are numerous, and overwhelmingly they uphold the va- 
 lidity of contracts such as this. It may be well to consider briefly a 
 few of them. Thus in Terkelsen v. Peterson, 216 Mlass. 531, 104 N. E. 
 351, the husband and wife had separated because of his faults. An 
 agreement was entered into through the medium of a trustee looking to 
 the resumption of marital relations, and under this agreement it was 
 covenanted that the husband would comport himself in all respects 
 as it was his duty to do, and that, in the "event of his drinking or ill 
 treating the wife resulting in her leaving him again, he would be liable 
 for her comfortable maintenance and support." The Supreme Court 
 of Massachusetts, in an opinion written by Rugg, Chief Justice, held 
 that the consideration for such an agreement was not the performance 
 by either the husband or wife of their marital duty, nor was it invalid 
 as an agreement to separate, but that it would be sustained as an agree*- 
 ment for the re-establishment of the family and to make better provi* 
 
I 
 
 See. 6) CONTRACTS AFFECTING IrfAKRIAGE 1319 
 
 sion for the wife's support in the event that the husband again of- 
 fended. 
 
 In Duffy V. White, 115 Mich. 264, 73 N: Wi S6i3, the Supreme Court 
 of Michigan was called upon to consider the same question. There 
 the husband discovered his wife's infidelity and had separated from 
 her. Afterward, by mutual agreement, the parties resumed marital 
 relations under a written trust in pursuance of which a portion of 
 the separate property of the wife was conveyed by her through a trus- 
 tee to the husband, the trust providing that out of the income the hus- 
 band should deposit monthly to his wife's account one-half of the in- 
 come, and the remaining one-half should be used for the maintenance 
 of their minor child and for himself. L,ater the wife eloped with an- 
 other man, and subsequently sought to avoid this agreement upon the 
 ground that its consideration was without validity. The Supreme 
 Court of Michigaii declared: "It has been held in this state that a 
 conveyance of property by a husband to his wife in consideration of 
 the discontinuance of a meritorious suit for divorce, and the resump- 
 tion of marital relations, was upon a valid and sufficient considera- 
 tion ; and the same has been held elsewhere, almost without exception. 
 * * * In Burkholdeir's Appeal, 105 Pa. 33, the contract provided 
 among other things, for the payment of certain sums in case of a sub- 
 sequent separation. The case arose after the terrliination of the mar- 
 riage by death, and the contract was enforced." The court said upon 
 this point: "The provision in the contract in the present case is pecu- 
 liar. It does not offer any premium to the wife to bring about a sep- 
 aration. On the contrary it places a penalty upon it. So it cannot be 
 said to be a contract 'looking to and favoring a separation' at her in- 
 stance.. As to the husband, it does not, enlarge his right to a separa- 
 tion beyond that given by law, if we construe the contract in the light 
 of surrounding circumstances. A proper inference from its provisions, 
 and the circumstances under which it was made, justify us in a re- 
 striction of the term 'flagrant misbehavior or desertion' to such as 
 would be ground f or' divof-ce. If this claim does not enlarge his rights 
 beyond those existing by law, we do not see how it can be said that 
 the provision was illegal and void as against public policy." 
 
 Changing the sex of the spouses, the language of the Pennsylvania 
 case has direct applicability to the present one." * * * 
 
 Afifirmed." 
 
 "The court then reviewed the following similar cases: Hlte v. Hite, 136 
 TTir f^!X) 124 S W 815 (1910) ; Montgomery v. Montgomery, 142 Mo. App- 
 Si 12^'S W lis (1910) Howell v. Howell, 42 Okl. 286. 141 Pac. 412 (1914) ; 
 barney v! Bayley (Pa.) 11 Atl. 438 (1887) ; Sommer v. Sommer, 87 App. Diy. 
 434 84 N Y Supp 444 (1903). 
 
 02 In accord: Bodgers v. Rodgers, 186 App. Div 7T, 174 N. T. SuPP- 24 
 (1919). Of. Merrill l Peaslee, 146 Mass. 460 16 NE 271 4^ St. Rep. 
 334 (1888) ; McKay v. McKay (Tex. Oiv. App.) 189 S. W. 520 (1916). 
 
I 
 
 1320 ILLEGAL CONTKACTS (Ch. 9 
 
 SECTION 7.— SUNDAY LAWS 
 
 SKINNER IRR. CO. v. BURKE. 
 
 (Supreme Judicial Court of Massachusetts, 1919. 231 Mass. 555, 
 121 N. E. 427.) 
 
 Action by the Skinner Irrigation Company against Charles S. Burke, 
 resulting in judgment for plaintiff. The case was reported to the 
 appellate division of the municipal court of the city of Boston, which 
 dismissed the report, and defendant appeals. Order dismissing re- 
 port affirmed. 
 
 Pierce, J. This is an action of contract to recover $218 for the 
 installation of a system of irrigation on the land of the defendant. The 
 answer sets up in defense "that if any contract was made by the 
 plaintiff and the defendant, it was made on the Lord's Day, and can- 
 not be enforced." 
 
 The facts, so far as they are material to the determination of the 
 single question raised by the answer and argued in the brief of the 
 defendant, are in substance as follows: On Sunday, June 27, 1915, 
 the duly authorized agent of the plaintiff met the defendant and they 
 made an oral agreement for the installation of the irrigation system 
 at a fixed price. This contract was void in its inception and could not 
 be ratified because its validity did not depend in, any degree on the 
 choice of the defendant. "The law annulled it, and there was no sub- 
 ject of ratification." Day v. McAUister, 15 Gray, 433, 434. On Mon- 
 day, June 28, 1915, the agent 'wrote the defendant a letter which be- 
 gan : "We wish to confirm agreement which we reached yesterday re- 
 garding the installation * * * of irrigation at your place. * * * " 
 In the paragraphs which followed the work which the plaintiff agreed 
 to perform and accomplish was set out in minute detail, as was the 
 "price for this work, installed complete as outlined." The defendant 
 received the letter but did not reply to it. There was evidence that 
 thereafter, in good faith, the plaintiff installed on the defendant's prem- 
 ises a system of irrigation, substantially in accordance with hjs letter of 
 June 28, 1915; and that the defendant, as he testified, was present at 
 times during the installation of the system and knew that it was being 
 done. There was also evidence that the fair value of the system as 
 installed was the contract price, $218. Later, on August 9, 1915, the 
 defendant wrote the agent that he had examined the plant and had^ 
 found a leak which he had not the necessary tools to tighten, and con- 
 cluded the letter by saying, "I guess you will have to send your man 
 down to see just what the trouble is." On September 13, 1915, the de- 
 fendant wrote the plaintiff company that "when all the pipes are 
 working I can't cover the ground as your guarantee said it would." 
 
Sec. 7) 
 
 SUNDAY LAWS 1321 
 
 in- 
 in- 
 
 In response to this last letter the plaintiff proposed to visit and 
 spect the plant on Sunday, September 19, 1915; and did in fact 
 spect it on Sunday, September 26, 1915. 
 
 On the foregoing facts, we think the contract under which the irri- 
 gation system was installed was not the oral contract of Sunday, June 
 27, 1915, but was a new contract adopted on Monday, June 28,' 1915, 
 upon the terms and conditions stated in the letter of the plaintiff' to the 
 defendant on the last-named date. See Miles v. Janvrin, 200 Mass. 
 514, 517, 86 N. E. 785, and cases cited. The fact that, after the work 
 was completed and the right to receive the agreed price had accrued, 
 the plaintiff, on a Sunday, examined and tested the plant on the de- 
 fendant's complaint of an insufficiency which the judge of the munici- 
 pal court found was not due to any defect in the system itself or its 
 method of installation or any other fault of the plaintiff, does not by 
 relation affect the validity of the contract or the plaintiff's right to re- 
 cover the agreed price, and distinguishes the case at bar from the 
 cases of Stewart v. Thayer, 168 Mass. 519, 47 N. E. 420, 60 Am. St. 
 Rep. 407; and Stewart v. Thayer, 170 Mass. 560, 49 N. E. 1020. 
 
 The judge refused rightly to rule as requested that "on all the evi- 
 dence the plaintiff cannot recover," and that "the offer contained in 
 the letter of the plaintiff to the defendant of June 28, 1915, not having 
 been accepted by the defendant, only constitutes an offer and is not 
 sufficient as a matter of law to enable the plaintiff to recover." 
 
 Order dismissing report affirmed. °^ 
 
 5 3 Contracts made on Sunday and contracts to do work on Sunday were 
 not invalid at common law. Tliere are statutes invalidating such contracts, 
 but their provisions vary widely. See Handy v. St. Paul Globe Pub. Co., 41 
 Minn. 188, 42 N. W. 872, 4 L. K. A. 466, 16 Am. St. Rep. 695 (ISS^), publish- 
 ing Sunday newspaper (cf. Pulitzer Pub. Co. v. McNichols [Mo.] 181 S. 
 W. 1, L. R. A. ldl6C, 1148 [1915] ) ; Reynolds v. Stevenson, 4 Ind. 619 (1853) ; 
 Merritt v. Earle, 29 N. T. 115, 86 Am. Dec. 292 (186i) ; Bryan v. Watson, 127 
 Ind. 42, 26 N. E. 666, 11 L. R. A. 6S (1890), contract for a charitable purpose 
 valid ; Lyon v. Strong, 6 Vt. 219 (1834) ; Stewart v. Thayer, 170 Mass. 560, 49 N. 
 E. 1020 (1898), contract indivisible and no recovery in quantum meruit for 
 week-day services. 
 
 A contract is not illegal in ease the negotiations were on Sunday, but the 
 final acceptance was on a week day. Berry v. O'Neill, 92 N. J. Law, 63, 104 
 Atl. 25 (1918). A contract signed on a week day, was expressly conditional 
 upon the written approval of O. ; the property was examined by C, and his 
 approval given in writing on Sunday; and the contract was held "void: 
 County Engineering Co. v. West, 88 N. J. Eq. 109, 102 Atl. 668 (1917). Ob- 
 serve that the offer and acceptance were completed and valid acts. 
 
1322 ILLEGAL CONTRACTS (Ch. 9 
 
 SECTION 8.— CONTRACTS INDUCING CRIME OR PRIVATE 
 
 WRONG 
 
 (lobbying — Fraud — Breach of Trust and Ofificial Duty) 
 
 COLUNS V. WIIvLS et ux. 
 
 (In the Queen's Bench, 1601. Cro. Ellz. 774.) 
 
 Assumpsit. And declares, that whereas the defendant Wills was a 
 suitor to the other defendant (his now wife, and the plaintiff's daugh- 
 ter), and the plaintiff offered to give with her in marriage £80 and 
 would give no more ; >and Wills, the other defendant, required £90 and 
 without that would not marry; and the feme, before marriage, in 
 consideration that the plaintiff would give the other £10 at her re^ 
 quest, to make the £80 £90 assumed, and 'promised to repay it within 
 a month after she should be required: and alleged in facto, that he 
 thereupon gave £90 to the defendant Wills in marriage, &c. and al- 
 ledgeth request after marriage, &g. The defendant pleaded noh as- 
 sumpsit and found against him; and judgment entered accordingly, 
 without privity of the Court. And it was now alleged, that this was 
 an insufficient and unlawful consideration to ground this action, and 
 made only in deceit of the defendant, who was her husband. — And of 
 that opinion was the whole Court ; for as well as she may promise the 
 repayment of £10 she may promise the repayment of all, or more, so 
 as her husband should be defrauded of all: and that which is given in 
 marriage, cannot be a considei-ation to ground a promise; especially 
 to charge the baron with that promise. Wherefore, in regard the 
 judgment was entered this term, and the record is yet in their breasts, 
 it was adjudged that it should be altered, and made quod querens nihil 
 capiat per billam. And a supersedeas was awarded to stay execution. 
 
 ATKINS V. JOHNSON. 
 ■ ' ' (Supreme Court of Vermont, 1870. 43 Vtl 78, S Am. Rep. 260.) 
 
 ■PiBRPOiNT, C. J.^* The case comes into this court upon a general 
 demurrer to the plaintiff's declaration. 
 
 The declaration alleges that "on the 22d day of July, 1867, the de- 
 fendant, hy his agreement in writing of that date, undertook and 
 promised the plaintiff that, in consideration that the plaintiff would 
 print and publish an ailicle in the Argus & Patriot, a weekly news- 
 paper published in Montpelier by the plaintiff, entitled 'A Jack at all 
 
 ^* Part of the opinion is omitted. 
 
Sec. 8) CONTRACTS INDUCING CRIME OR PRIVATE WRONG 1323 
 
 Trades Exposed-/ that said article was all true, that there was enough 
 to back it up, &c., and that he, -the said defendant, would defend and 
 save harmless the plaintiff from all damage and harm that might ac- 
 crue to, the plaintiff in consequence of publishing said article. That 
 said article, if untrue, was a libel upon the character of one John 
 Gregory ; that relying upon the said promises of the defendant he pub- 
 lished tlie article ; that after said publication the said Gregory called 
 upon the plaintiff for the name of the writer of the article ; that there- 
 upon the defendant requested the plaintiff not to give the said Gregory 
 the name of the writer, and, in consideration thereof, promised the 
 plaintiff that he would save him from all harm ; that if said Gregory 
 sued the plaintiff, that he, the defendant, would .defend the suit, prove 
 the "charges, and save the plaintiff froni all trouble; and expense in 
 the premises. The plaintiff, relying thereon, withheld the name of the 
 defendant as the autlior of said article; that the said Gregory sued- 
 the plaintiff; that the defendant failed to, defend the said suit, and the 
 said Gregory recovered a judgment against the plaintiff, which he, has 
 been compelled to pay, and the defendant refuses to indemnify liinii" 
 
 The plaintiff is here seeking to compel the, defendant to indemnify 
 him for the damage which he has sustained, in consequence of pub- 
 lishing' a libel, at the request of the defendant, and from the conse- 
 quences of which the defendant agreed to save him harmless. 
 
 The question is, whether such an agreement as the plaintiff sets out 
 in his declaration can be legally enforced. ,. ,, 
 
 The general prinpiple, that there can be, no contribution) o,r,indem7 
 nity, as between joint wrong-doers, is too well settled to reqtiire either 
 argument or authority. 
 
 To this rule there are many exceptions, and prominent among tjie;nj 
 is the class of cases where questions arise between different parties as 
 to the ownership of property, and a third person,, supposing one party 
 to be in the right, upon the request and under the authority of such 
 party, does acts that are legal in themselves, but which prove in the 
 end to be in violation of the rights of the other party, and he, in con- 
 sequence thereof, is made liable in damages. If in such case there was 
 a promise of indemnity, the law will enforce it, and if there was hot, 
 if the circumstances will warrant it, the law will imply a promise of 
 indemnity, and enforce that. Of this class are most of the cases cited 
 and relied upon by the counsel for the plaintiff, such as, Betts v. Gib- 
 bins; Adamson v. jarvis; Wooley v. Batte; Avery v. Halsey, &c. 
 But we apprehend that no exception has ever been recognized broad 
 enough to. embrace a case like the present; indeed such an exception 
 would be a virtual abrogation of the rule. . 
 
 In this case, these parties in the outset conspired to do a wrong to 
 one of their neighbors, by publishing a libel upon his character. The 
 publication of a libel is an illegal act upon its face. This, both parties 
 Ire presumed to have known. The publication not only subjects the 
 party publishing to a prosecution by the person injured for damages, 
 
1324 ILLEGAL CONTRACTS (Ch. 9 
 
 but also to a public prosecution by indictment. In either case, all that 
 would be required of the prosecutor vrould be to prove the publication 
 by the party charged. The law in such case presumes malice and dam- 
 age, and the prosecutor would be entitled to a judgment, unless the 
 party charged could introduce something by way of defense that 
 would have the effect to discharge him from legal liability ; failing in 
 that, the party would be made liable upon a simple state of facts, all 
 of which he perfectly understood at the time he commenced his un- 
 justifiable attack. 
 
 In this case, both these parties knew that they were arranging for 
 and consummating an illegal act, one that subjects them to leg'al lia- 
 bility, hoping, to be sure, that they might defend it; but the plaintiff, 
 fearing they might not be able to do so, sought to protect himself from 
 the consequences, b)^ taking a contract of indemnity from theidefend- 
 ant. To say under such circumstances that these parties were not 
 joint wrong-doers, with iti the full spirit and meaning of the general 
 rule, would be an entire perversion of the plainest and simplest propo- 
 sition. This being so, the law will not interfere in aid of either. It 
 will not inquire which of the two is most in the wrong, with a view of 
 adjusting the equities between them, but regarding both as having 
 been understandingly engaged in a violation of the law, it will leave 
 them as it finds them, to adjust their differences between themselves, 
 as they best may. * * * 
 
 The position, in vvhich the facts confessed upon the i-ecord place 
 the defendant, is not an enviable one. He sefems to have originated 
 the mischief — to have induced the plaintiff to aid him in carrying it 
 into effect by assurance of the truth of the statements, and a promise 
 of indemnity, and after standing by and seeing the plaintiff amerced in 
 damages takes advantage of a strictly legal defense, and throws the 
 whole responsibility upon the plaintiff. Personally, it would have giv- 
 en me satisfaction to have decided the case for the plaintiff, if it could 
 have been done without violating well-established and salutary rules of 
 law. 
 
 Judgment of the cbunty court is afiirmed.^'* 
 
 °5 A contract to publish a book not yet written is not made invalid merely 
 because it contains a provision for indemnity against libel suits, where no libel 
 was published and it is not shown that any was intended. Jewett Pub. Co. v. 
 Butler, 159 Mass. 517, 34 N. E. 10S7 (18fi3). A contract by a seller of a soft 
 drink to indemnify the buyer against damages that might come from prose- 
 cution for violation of a prohibitory law is not illegal, no intent to sell in- 
 toxilcating liquor being shown. Owens: v. Henderson Brewing C!o , 185 
 Ky. 477, 215 S. W. 90 (1919). Contra : Smith v. Clinton, 25 T. L. li. 34 (1908). 
 
 Any contract to commit a crime or a tort is illegal. The Highwayman's 
 Case (Exch.) 2 Evans' Pothier on ObUg., 3, N. 1 (1725), Scott's Cases" on 
 Quasi Contracts, 666; Allen v. Rescous, 2 Lev. 174 (1675), to commit an 
 assault. The commonest example is a contract the purpose of which is to 
 defraud or injure a third person financially. Clay v. Yates, 1 H. & N^ 73 
 (1856) ; American Mfg. Co. v. Crescent Drag Co., 113 Miss. 130, 73 South. 883, 
 li. .K. A. 1917D, 482 (1917) ; Matefne v. Horwitz, 101 N. Y. 469, 5 N E 331 
 (1886) ; Merrill v. Packer, 80 Iowa, 542, 45 N. W. 1076 (1890)'; Churih- v 
 
Sec. 8) CONTRACTS INDUCllSrG CRIME OR PRIVATE WRONG 1325 
 
 PROVIDENCE TOOL CO. v. NORRIS. ■ 
 (Supreme Court of the United States, 1864. 2 Wall. 45, 17 L. Ed. 868.) 
 
 In July, 1861, the Providence Tool Company, a corporation created 
 under the laws of Rhode Island, entered into a contract with the gov- 
 ernment, through the secretary of war, to deliver to officers of the 
 United States, within certain stated periods, . twenty-five thousand 
 muskets, of a specified pattern, at the rate of twenfy dollars a musket. 
 This contract was procured through the exertions of Norris, the 
 plaintiff in the court below, and the defendant in error in this court, 
 upon a previous agreement with the corporation, through its man- 
 aging agent, that in case he obtained a contract of this kind he should 
 receive compensation for his services proportionate to its extent, 
 
 Norris himself, it appeared, — ^though not having any imputation on 
 his moral character, — ^was a person who had led a somewhat mis- 
 cellaneous sort of a life, in Europe and America. Soon after the re- 
 bellion broke out, he found himself in Washington. He was there 
 without any special purpose, but, as he stated, with a view of "making 
 business — anything generally;" "soliciting acquaintances;" "getting 
 letters ;" "getting an office," &c. Finding that the government was 
 in need of arms to suppress the rebellion, which had now become 
 organized, he applied to the Providence Tool Company, already men- 
 tioned, to see if they wanted a job, and made the contingent sort of 
 contract with them just referred to. He then set himself to work at 
 what he called, "concentrating infiuence at the war department;" 
 that is to say, to getting letters from people who might be supposed 
 to have influence with Mr. Cameron, at that time secretary of war, 
 recommending him and his objects. Among other means, he, applied 
 to the Rhode Island senators, Messrs. Anthony and Simmons, with 
 whom he had got acquainted, to go with him to the war office. Mr. 
 Anthony declined to go; stating that since he had been senator he 
 had been applied to some hundred times, in like manner, and had in- 
 variably declined; thinking it discreditable to any senator to inter- 
 meddle with the business of the departments. "You will certainly 
 not decline to go with me, and introduce me to the secretary, and to 
 state that the Providence Tool Company is a responsible corpora- 
 tion." "I will give you a note," said Mr. Anthony. "I do not want 
 a note," was the reply ; "I want the weight of your presence with me. 
 I want the influence of a senator." "Well," said Mr. Anthony, "go 
 
 Proctor, 66 Fed. 240, 13 C. C. A. 426 (1895) ; Randall v. Howard, 67_U. S. (2 
 Black) 585 17 L Ed. 269 (1862) ; Wanderer's Hockey Club v. Johnson, 18 
 Brit Col 367 25 West. L. K. 434 (1913), contract the purpose of which is 
 to induce a breach of a contract with a third person; Rhoades v. Malta 
 Vita Pure Food Co., 149 Mich. 235, 112 N. W. 940 (1907), same; McNair v. 
 Varr 177 Mich 327, 143 N. W. 42 (1913), contract between family doctor 
 and k surgeon to split the fee; Smith v. Rose, 192 Mo. App. 580, 184 S W. 
 910 (1916) , clairvoyant agreed to advise purchase of certain mining stock. 
 
1326' ;; illegal contracts ,,■; (Ch. 9- 
 
 to Simmons." By one means and another, Norris got influential in- 
 troduction to Mr. Secretary CamerOn, and got the contract, a very 
 profitable one; the secretary, whom on leaving he warmly thanked, 
 "hoping that he would make a great deal of rhoney out of it." 
 
 But a dispute now arose between Norris and the tool company, ■ as 
 to the amount of compensation to be paid. Norris insisted that, by 
 the agreement with him he was to receive $75,000 ; the difference be- 
 tween the contract price and seventeen dollars a musket; whilst the 
 corporation, on the other hand, contended, that it had only promised 
 "a liberal compensation" in case of success. Some negotiation on 
 the subject was had between them; but it failed to produce a settle- 
 ment, and Norris instituted the present action to recover the fuU 
 amount claimed by him. 
 
 The declaration contained several counts; the first and second 
 ones, special; the third, fourth, and fifth, general. ' The special ones 
 set forth specifically a contract, that if he, Norris, procured the gov- 
 ernment to give the order to the company, the company would pay ■ 
 to him, Norris, "for his services, in obtaining, or causing arid pro- 
 curing to be obtained, such order', all that the government might, by 
 the terms of their arrangement with the company, agree to pay above' 
 $17 for each musket." The generar counts Were in the usual form 
 of quantum mertiit, &c. ; but in these counts, as in the special ones, a 
 contract was set forth on the basis of a compensatiop, contingent, up- 
 oti Norris's procuring an order from the 'government for muskets for 
 the tool company; reliance on this contingent sort of contract rim- 
 ning through all the counts of the declaration. There was no pre- 
 tence that the plaintiff had rendered any other seryice than that which 
 resulted in the contract for the muskets. 
 
 On the trial in the circuit court for the Rhode Islatnd district, the- 
 counsel of the tool company requested the court to instrjact the jury, 
 that a contract like that declared on in the first and second counts was 
 against public policy, and void; which instruction the court refused 
 to give. The same counsel requested the court to charge, "that upon 
 the quantum' meruit count the plaintiff was not entitled in law to re- 
 cover' any other sum of money, for services rendered to the tool com- 
 pany in procuring a contract for making arms, than a fair and reason- 
 able compensation for the time, speech, labor performed, and ex- 
 penses incurred in performing such services, to be computed at a 
 price for which similar services could have been obtained from others." 
 The court gave this instruction, with the exception of the last nine 
 words. The jury found for the defendant on the first and second — 
 that is to say, upon the special — counts, and for the plaintiff on the 
 others, and judgment was entered on $13,500 for the plaintiff. The 
 case came, by writ of error, here. 
 
 Mr. Justice Field delivered the opinion of the court. 
 
 Several grounds were taken, in the court below, in defence of this 
 action; and, among others, the corporation relied upon the pro'posi- 
 
Sec. 8) CONTRACTS INDUCING CRIME OR PRIVATE WRONG 1327 
 
 tion of law, that an agreement of the character stated —that is, an 
 agreemdlt for compensation to procure a contract from the govern- 
 ment to furnish its supplies,— is against public policy, and void. This 
 proposition is the question for the consideration of the court. It 
 arises upon the refusal of the court below to give one of the instruc- 
 tions asked. 
 
 A suggestion was made on the argument, though not much press- 
 ed, that the instruction involving the proposition cannot properly be 
 regarded, inasmuch as it was directed in terms to the agreement set 
 forth in the special counts of the declaration, upon which the jury 
 found for the defendants. I'here would be much force in this sugges- 
 tion, if the general counts, upon which the verdict passed for the 
 plaintiff, did not also aver that his services' were rendered in procuring 
 the same contract from the government. The instruction was directed 
 especially to the legality of a contract of that kind, which having been 
 once refused with reference to some of the Counts, it was not neces- 
 sary for counsel to renew with reference to the other counts to which 
 it was equally applicable. The subsequent instructions were, there- 
 fore, directed to other matters. 
 
 It was not claimed, on the trial, that the plaintiff had rendered any 
 other services than those which resulted in the procurement of the 
 contract for the muskets. We are of opinion, therefore, that the prop- 
 osition of law is fairly presented by the record, and is before us for 
 consideration. 
 
 The question, then, is this : Can an agreement for compensation to 
 procure a contract from the government to furnish its supplies be en- 
 forced by the courts ? We have no hesitation in answering the ques- 
 tion in the negative. All contracts for supplies should be made Vith 
 those, and with those only, who will execute them most faithfully, and 
 at the least expense to the government. Considerations as to the 
 most efificient and economical mode of meeting the public wants should 
 alone control, in this respect, the action of every department of the 
 government. No other consideration can lawfully enter into the 
 transaction, so far as the government is concerned. Such is the rule 
 of public policy ; and whatever tends to introduce any other elements 
 into the transaction, is against public policy. That agreements, like 
 the one under consideration, have this tendency, is manifest. They 
 tend to introduce personal solicitation, and personal influence, as 
 elements in the procurement of contracts ; and thus directly lead' to 
 inefificiencv in the public service, and to unnecessary expenditures of 
 the public funds. > r, 
 
 The principle which determines the invalidity of the agreement in 
 question has been asserted in a great variety of cases. It has beep 
 asserted in cases relating to agreements for compensation to procure 
 legislation. These have been uniformly declared invalid, and the de- 
 cisions have not turned upon the question, whether improper in- 
 fluences were contemplated or use4 but upon the corrupting tendency 
 
1328 : '- ILLEGAL CONTEACTS (Ch. 9 
 
 of the agreements. Legislation should be prompted solely from con- 
 siderations of the public good, and the best means of adwncing it. 
 Whatever tends to divert the attention of legislators from their high 
 duties, to mislead their judgments, or to substitute other motives for 
 their conduct than the advancement of the public interests, m.ust nec- 
 essarily and directly tend to impair the integrity of our political in- 
 stitutions. Agreements for'" compensation contingent upon success, 
 suggest the use of sinister and corrupt means for the accomplishment 
 of the end desired. The law meets the suggestion of evil, and strikes 
 down the contract from its inception. 
 
 There is no real difference in principle between agreements to pro- 
 cure favors frpm legislative bodies, and agreements to procure favors 
 in the shape of contracts from the heads of departments. The intro- 
 duction of improper elements to control the action of both, is the 
 direct and inevitable result of all. such arrangements. Marshall v. 
 Railroad Co., 16 How. 314, 14 L. Ed. 953 ; Harris v. Roof's Ex'rs, 
 10 Batb. (N. Y.) 489; Fuller v. Dame, 18 Pick. (Mass.) 472. 
 
 The same principle has also been applied, in numerous instances, 
 to agreements for compensation to procure appointments to public 
 offices. These offices are trusts, held solely for the public good, and 
 should be conferred from considerations of the ability, integrity, 
 fidelity, and fitness for the position of the appointee. No other con- 
 siderations can properly be regarded by the appointing power. Wliat- 
 ever introduces other elements to control this power, must necessarily 
 lower the character of the appointments, to the great detriment of the 
 public. Agreements, for compensation to procure these appointments 
 tend directly and necessarily to introduce such elements. The law, 
 therefore, from this tendency alone, adjudges these agreements in- 
 consistent with sound morals and public policy. Gray- v. Hook, 4 N. 
 Y. 449. 
 
 Other agreements of an analogous character might be mentioned, 
 which the courts, for the same or similar reasons, refuse to uphold. 
 It is unnecessary to state them particularly; it is sufficient to, ob- 
 serve, generally, that all agreements for pecuniary considerations t,o 
 control the btisiness operations of the government, or the regular 
 administration of justice, or the appointments to public offices, or the 
 ordinary course of legislation, are void, as against public policy, with- 
 out reference to the question, whether improper means are contem- 
 plated or used in their execution. The law looks to the general tend- 
 ency of such agreements; and it closes the door to temptation, by 
 refusing them recognition in any of the courts of the country. 
 • It follows that the judgment of the court below must be reversed, 
 and the cause remanded for a new trial; and it is so ordered.^" 
 
 <>« In accord: Montefiore v. Menday Motor C. Co. (K. B.) 119 L. T. 340 
 (1918), to use personal influence in getting money from the government to 
 finance aircraft company | Crocker v. U. S., 240 U. S. 74,- 36 Suj). Ct. 245, 60 
 li. Ed. 5.S3 (1915) ; Bec-lc v.Baulhati, 105 Misc. Rep. 584, .173 N. Y. Supp. 
 
Sec. 8) CONTRACTS INDUCING CRIME OR PRIVATE WRONG 1329 
 
 TRIST V. CHILD. 
 (Supreme Court of the United States, 1874. 21 Wall. 441, 22 L. Ed. 623.) 
 
 Appeal from the supreme com't of the District of Columbia; the 
 case being thus : 
 
 N. P. Trist having a claim against the United States for his serv- 
 ices, rendered in 1848, touching the treaty of Guadalupe Hidalgo — a 
 claim which the government had not recognized — resolved, in 1866-7 
 to submit, it to congress and to ask payment of it. And he made an 
 agreement with lyinus Child, of Boston, that Child should take charge 
 of the claim and prosecute it before congress as his agent and attor- 
 ney. As a compensation for his services it was agreed that Child 
 should receive 25 per cent, of whatever sum congress might allow in 
 . payment of the claim'. If nothing was allowed, Child was to receive 
 nothing. His compensation depended wholly upon the contingency 
 of success. Child prepared a petition and presented the clairn to con- 
 gress. Before final action was taken upon it by that body Child died. 
 His son and personal representative, L. M. Child, who was his partner 
 when the agreement between him and Trist was entered into, and 
 down to the time of his death, continued the prosecution of the claim. 
 By an act of the 20th of April, 1871, congress appropriated the sum 
 of $14,559 to pay it. The son thereupon applied to Trist for payment 
 of the 25 per cent, stipulated for in the agreement between Trist and 
 his father. Trist declined to pay. Hereupon Child applied to the 
 treasury department to suspend the payment of the money to Trist. 
 Paym.ent was suspended accordingly, and the money was still in the 
 treasury. 
 
 Child, the son, now filed his bill against Trist, praying that Trist 
 might be enjoined from withdrawing the $14,559 from the treasury 
 until he had complied with his agreement about the compensation, 
 
 772 (1919), to pay 2 per cent, on any contract with the federal government 
 for war supplies; Glenn v. Southwestern Gravel Co. (Okl.) 177 Pac. 586 
 (1919), contingent fee for securing city ordinance for a street improvement 
 in which one party is Interested as contractor ; Hyland v. Oregon Hassam 
 Paving Co., 74 Or. 1, 144 Pac. 1160, L. R. A. 19150, 823, Ann. Cas. 1916E, 941 
 (1914) to "do everything in his power" to obtain a. municipal contract, at a 3 
 per cent commission; Oliver v. Wilder, 27 Colo. App. 337, 149 Pac. 275 (1915), 
 secretary of state let contracts for the publication of constitutional amend- 
 ments at maximum statutory flgur^-in fact 20 tilnes market value-^the coun- 
 ty paper agreeing to divide the money with all other local papers who would 
 support the entire Democratic ticket. , . . 
 
 On the lawful side of the line, not always easily distinguishable, see 
 Anderson v Blair, 202 Ala. 209, 80 South. 31 (1918), joint adventure to help 
 set a contract from the government for construction of a camp, to help in its 
 perfoi-mance, for a share of the profits, nothing indicating the use of im- 
 proper influence; Lyon v. Mitchell, 36 N. Y. 235, 93 Am. Dee. 502; Id 36 
 N. Y. 682 (1867), commission for obtaining a government contract ; Kerr 
 V. American Pneumatic Service Co.,. 188 Mass. 27, 73 N. E. 857 (1«05) ; 
 Mechem Agency (2d Ed.) § 100. 
 COEBIN CoNT — 84 
 
1330 ILLEGAL CONTRACTS ' (Ch. 9 
 
 and that a decree might pass commanding him to pay to the complain- 
 ant $5,0(X), and for general relief. 
 
 The defendant answered the bill, asserting, with Other defences 
 going to the merits, that all the services as set forth in their bill were 
 "of such a nature as to give no cause of action in any court either of 
 common law or equity." 
 
 The case was heard upon the pleadings and much evidence. A part 
 of the evidence consisted of correspondence between the parties. It 
 tended to prove that the Childs, father and son, had been to see vari- 
 ous members of congress, soliciting their influence in behalf of a bill 
 introduced for the benefit of Mr. Trist, and in several instances ob- 
 taining a promise of it. There was no attempt to prove that any 
 kind of bribe had been offered or ever contemplated ; but the follow- 
 ing letter, one in the correspondence put in evidence, was referred to 
 as showing the effects of contracts such as the one in this case : 
 "From Child, Jr., to Trist. House of Rept'esentatives, Washington, 
 D. C, Feb. 20th, 1871. Mr. Trist: Everything looks Very favorable. 
 
 I found that my father has spoken to C^ — • and B , and other 
 
 members of the House. Mr. B says he will try hard to get it 
 
 before the House. He has two more chances, or rather 'morning 
 
 hours,' before Congress adjourns. A will go in for it. D 
 
 promises to go for it. I have sent your letter and report to Mr. 
 W — ■■ — , of Pennsylvania. It may not be reached till next week. 
 Please write to your friends to write immediately to any member of 
 Congress. Every vote tells ; and a simple request to a member may 
 secure his vote, he not caring anything about it. Set every man you 
 know at work, even if he knows a page, for a page often gets a vote. 
 The most I fear is indifference. Yours, &c., L. M. Child." 
 
 The court below decreed : 
 
 1st. That Trist should pay to the complainant $3,639, with interest 
 from April 20th, 1871. ' 
 
 2d. That until he did so, he should be enjoined from receiving at 
 the treasury "any of the moneys appropriated to him" by the above 
 act of congress, of April 20th, 1871. 
 
 From this decree the case was brought here. 
 
 The good character of the Messrs. Child, father and son, was not 
 denied. 
 
 Mr. Justice SwAyne, delivered the opinion of the court.^' * * * 
 
 Was the contract a valid one? It was, on the part of Child, to pro- 
 cure by lobby service, if possible, the passage of a bill providing for 
 the payment of the claim. The aid asked by the younger Child of 
 Trist, which indicated what he considered needful, and doubtless 
 prqposedio do and did do himself, is thus vividly pictured in his let- 
 ter to Trist of, the, 20th February, 1871', After giving the names of 
 ■ several members of congress, from whom he had received favorable 
 
 ^^ Part of the opinion is omitted. 
 
Sec. 8) CONTEACTS INDUCING CRIME OB PRIVATE WRONG 1331 
 
 assurances, he proceeds: "Please write to your friends to write to 
 any member of congress. Every vote tells, and a simple request may 
 secure a vote, he not caring anything, about it. Set every man you 
 know at work. Even if he knows a page, for a page often gets a vote." 
 
 In the Roman law it was declared that "a promise made to effect a 
 base purpose, as to commit homicide or sacrilege, is not binding." 
 Just. Inst. lib. 3, tit. 19, par. 24. In our jurisprudence a contract may 
 be. illegal and void because it is contrary to a constitution or statute, 
 or inconsistent with sound policy and good, morals. Lord Mfinsfield 
 said (Jones v. Randall, 1 Cowp. 39) : "Many contracts which are not 
 against morality, are still void as being against |the maxims of sound 
 policy." 
 
 It is a rule of the common law of universal application, th^t where 
 a contract express or implied is tainted with either of the vices last 
 named, as to the consideration or the thing to be done, no alleged right 
 founded upon it can be enforced in a court of justice. 
 
 Before considering the contract here in question, it may be well,, by 
 way of illustration, to advert to some of the cases presenting the 
 subject in other phases, in which the principle has been adversely ap- 
 plied. 
 
 Within the condemned category are: An agreement to p^y for sup- 
 porting for election a candidate, for sheriff, Syv;ayze v. Ijull, 8 N. J. 
 Law, 54, 14 Am. IJ'ec. 399, to pay for resigning a public position to 
 make room for another ; Eddy v. Capron, 4 R. I. 395, 67 Am, Dec. 
 541 ; Parsons v. Thompson, ,1 H- Bl. 33? ; to pay, for not bidding at a 
 sheriff's sale of real property, Jones v. Caswell, 3 Johns. Cas. (N. Y.) 
 29, 2 Am. Dec. 134; to pay for not bidding fpi; articles to be sold by 
 the government at auction, DpoUn v. Ward, 6 Johns. (N. Y.) 194; 
 to pay for not bidding for a contract to carry the mail on a specified 
 route, Gulici: V. Bailey, 10 N. J.' Law, 87, 18 Am., Dec. 389; to pay 
 a person for his aid and influence in procuring an office, and for not 
 being a candidate himself , Gray v. Hook, 4 N. Y. 449; to pay for pro- 
 curing a contract from the government. Tool Co. v. Norns, 2 Wall. 45, 
 17 L Ed 868- to pay for procuring signatures to a petition to the 
 governor for a pardon, flatzfield v., Gulden, 7 Watts (Pa.) 152, 31 Am. 
 Dec 750 ■ to sell land to a particular person when the surrogate's or- 
 der to sell should have been obtained. Overseers of Bridgewater v. 
 Overseers of Brookfield, 3 Cow. (N. Y.) 299; to pay for^suppressing 
 evidence and compounding a felony, Collins v. Blantern, 2 Wils. 347; 
 to convey and assign a part of what should come from an ancestor 
 by descent, devise, or distribution, Boynton v. Hubbard 7 Mass. 112 
 to pay for promoting a marriage, Scribblehill v. Brett, 4 Brown Pari. 
 Cas 144; Arundel v. TreviUian, 1 Ch. Rep. 47 ; to influence the 
 disposition of property by will in a particular way, D.ebenham y. Ox. 
 1 Ves 276. See, also. Add. Cont. 91; 1 Story, Eq. c. 7; Colhns v. 
 ■Blantern, 1 Smith Lead. Cas., 676, Am. note. . 
 
 The question now before us has been decided in four American 
 
1332 ILLEGAL CONTEACTS (Ch. 9 
 
 cases. They were all ably considered, and in all of them the con- 
 tract was held to be against public policy, and void. Clippinger v. 
 Hepbaugh, 5 Watts & S. (Pa.) 315, 40 Am. Dec. 519; Harris v. Roof's 
 Ex'r, 10 Barb. (N. Y.) 489; Rose & Hawley v. Truax, 21 Barb. (N. 
 Y.) 361 ; Marshall v. Railroad Co., 16 How. 314, 14 L. Ed. 953. We 
 entertain no doubt that in such cases, as under all other circumstanc- 
 es, an agreement express or implied for purely professional services is 
 valid. Within this category are included, drafting the petition, to set 
 forth the claim, attending to the taking of testimony, collecting facts, 
 preparing arguments, and submitting them orally or in writing to a 
 committde or other proper authority, and other services of like char- 
 acter.''^ All these things are intended to reach only the reason of 
 those sought to be influenced. They rest on the saine principle of 
 ethics as professional services rendered in a court of justice, and are 
 no more exceptionable. But such services are separated by a broad 
 line of demarcation from personal solicitation, and the other means 
 and appliances which the Correspondence shows were resorted to in this 
 case. There is no reason to believe that they involved anything cor- 
 rupt or different from what is usually practiced by all paid lobbyists 
 in the prosecution of their business. 
 
 The foundation of a republic is the virtue of its citizens. They are 
 at once sovereigns and subjects. As the foundation is undermined, 
 the structure is weakened. When it is destroyed, the fabric must fall. 
 Such is the voice of universial history. 1 Montesqi Spirit of Laws, 17. 
 The theory of our government is, that all public stations are trusts, 
 and that those clothed with them are to be animated in the discharge 
 of their duties solely by considerations of right, justice, and the pub- 
 lic good. They are never to descend to a lower plane. But there is a 
 correlative duty resting upon the citizen. In his intercourse with those 
 in authority, whether executive or legislative, touching the perform- 
 ance of their functions, he is bound to exhibit truth, frankness, and 
 integrity. Any departure from the line of rectitude in such cases, is 
 not only bad in morals, but involves a public wrong. No people can 
 have any higher public interest, except the preservation of their lib- 
 erties, than integrity in the administration of their government in all 
 its departments. 
 
 The agreement in the present case was for the sale of the influence 
 and exertions of the lobby agent to bring about the passage of a law 
 for the payment of a private claim, without reference to its merits, by 
 means which, if not corrupt, were illegitimate, and considered in con- 
 nection with the pecuniary interest of the agent at stake, contrary to 
 
 6 8 In accord: Stroemer v. Van Orsdel, 74 Neb. 132, 103 N. W. 1053, 107 
 N. W. 125, 4 L. E. A. (N. S.) 212, 121 Am. St. Rep. 713 (1905) ; Houlton v. 
 Nichol, 93 Wis. 393, 67 N. W. 715, 33 L. R. A. 166, 57 Am. St. Rep. 928 (1896) :; 
 Kansas City Paper House v. Foley Ry. Printipg Co., 85 Kan. 678, 118 Pac. 
 1056, 39 L. R. A. (N. S.) 747, Ann. Cas. 1913A, 294 (1911) ; Moyersv. City of 
 Memphis, 135 Tenn. 263, 186 S. W; 105, Ann. Cas. 1918C, 854 (1916). ; 
 
Sec. 8) CONTRACTS INDUCING CRIME OR PRIVATE WRONG 1333 
 
 the plainest principles of public policy. No one has a right, in such 
 circumstances, to put himself in a position of temptation to do what is 
 regarded as so pernicious in its character. The law forbids the in- 
 choate step, and puts the seal of its reprobation upon the undertak- 
 ing. 
 
 If any of the great corporations of the country were to hire adven- 
 turers who make market of themselves in this way, to procure the 
 passage of a general law with a view to the promotion of their pri- 
 vate interests, the moral sense of every right-minded man would in- 
 stinctively denounce the employer and employed as steeped in corrup- 
 tion, and the employment as infamous. 
 
 If the instances were numerous, open, and tolerated, they would be 
 regarded as measuring the decay of the public morals and the degen- 
 eracy of the times. No prophetic spirit would be needed to foretell 
 the consequences near at hand. The same thing in lesser legislation, 
 if not so prolific of alarming evils, is not less vicious in itself, nor less 
 to be condemned. The vital principle of both is the same. The evils 
 of the latter are of sufficient magnitude toi invite the most serious con- 
 sideration. The prohibition of the law rests upon a solid foundation. 
 A private bill is apt to attract little attention. It involves no great pub- 
 lic interest, and usually fails to excite much discussion. Not unfre- 
 quently the facts are whispered to those whose duty it is to investigate, 
 vouched for by them, and the passage of the measure is thus secured. 
 If the agent is truthful, and conceals nothing, all is well. If he uses 
 nefarious means with success, the spring-head and the stream of leg- 
 islation are polluted. To legalize the traffic of such service, would 
 open a door at which fraud and falsehood would not fail to enter and 
 make themselves felt at every accessible point. It would invite their 
 presence and offer them a premium. If the tempted agent be cor- 
 rupt himself, and disposed to corrupt others, the transition requires but 
 a single step. He has the means in his hands, with every facility and 
 a strong incentive to use them. The widespread suspicion which pre- 
 vails, and charges openly made and hardly denied, lead to, the conclu- 
 sion that such events are not of rare occurrence. Where the avarice 
 of the agent is' inflamed by the hope of a reward contingent upon suc- 
 cess, and to be graduated by a percentage Upon the amount appropri- 
 ated, the danger of tampering in its worst form is greatly increased. 
 
 It is by reason of these things that the law is as it is upon the sub- 
 ject. It will not allow either party to be led into temptation where 
 the thing to be guarded against is so deleterious to private morals and 
 so injurious to the public welfare. In expressing these views, we fol- 
 low the lead of reason and authority. 
 
 We are aware of no case in English or American jurisprudence like 
 the one here under consideration, where the agreement has not been 
 adjudged to be illegal and void. - . 
 
 We have said that for professional services in this connection a 
 just compensation may be recovered. But where they'a^e blended and 
 
1334 ILLEGAL CONTRACTS ' (Ch; 9 
 
 confused with those which are forbidden, the whole is a unit and in- 
 divisible. That which is bad destroys that which is good, and they 
 perish together. Services of the latter character, gratuitously render- 
 ed, are not unlawful. The absence of niotive to wrong is the founda- 
 tion of the sanction. The tendency to mischief, if not v/anting, is 
 greatly lessened. The taint lies in the stipulation for pay. Where 
 that exists, it affects fjltallyj in all its parts,' the entire body of the 
 contract. In all such cases, potior conditio defendentis. Where there 
 is turpitude, the law will help neither party. 
 
 The elder agent in this case is represented to havebeen a lawyer of 
 ability and high character. The appellee is said to be equally worthy. 
 This can make no difference as to the legal principles we have con- 
 sidered, nor in their application. to the case in hand. Thedaw is no re- 
 specter of pei^sons. ' 
 
 Decree reversed, and the case remanded, with directions to dismiss 
 the bill.'>» 
 
 MEGUIRE V. CQRWINE. 
 
 (Supreme Court of the XJnit^d States, 1879. 101 U. S. 108, 25 L. Ed.' 89'9.) 
 
 Mr. Justice SwaynS delivered the opinion of .the, court., ,; ,, 
 
 The plaintiff- in the court below i^ the plaintiff in. error h^ere,,.,-- 
 The, -first QQunt of the declaration avers that in, consideration, of 
 the . assistance to be rendered by hirn, to the defenfiants', testaljQJf^.in 
 procuring hijn tq be appointed special counsel of the United States in 
 certain litigated cases, known as the "Farragut prize cases," and also 
 in consideration of jthe , assistance to be rendered by the plaintiif- in 
 managing ^nd carrying on, the defence in those cases, — which assist- 
 ance was Accordingly rendered, — the testator, promised the, plaintiff ,tp 
 pay him pne-half of all fees which the testator, should receive as suclj^ 
 special counsel, and that the tesstatpr, did receive as such special coun- 
 sel in those cases $29,950, of whiqh; sum th^ plaintiff was entitled to be 
 paid one-half, &c. ," ^ , 
 
 The second count is substantially th^,.,fSame with the: first, except 
 that it ay.er^ the consideration of the contract to have been the assist- 
 ancfe to be rendered by the plaintiff in the defence of the cases named, 
 and is silent as to the stipulation that he was to assist in procuring the 
 appointment of the testator as special counsel for the government. 
 
 **' Other lobbying contracts were held unlawful in Adams v. East Boston 
 Co., 236 Mass. 121, 127 N. E. 628 (1920) ; Buchanan v. Farmer, 122 Ark. 562, 
 184 S. W. 33 (1916) ; Hogston v. Bell, 185 Jnd. 536, 112 N. K. 8«5 (1916) ; 
 Owens V. Wilkinson, 20 App. D. C. 51 (1902) ; Criehfield v. Bermudez. 
 Asphalt Paving Co., 174 111. 466, 51 N. B. 552, 42 L. R. A. 347 (1898), 
 contingent fee for procuring city ordinance; Richardson v. Scott's Bluff 
 County, 59 Neb. 400, 81 N. W. 309, 48 L. R. A. 294, 80 Am. St. Rep. 682 (1899) ; 
 Mills .V. Mills, 40 N. Y. 543, 100 Am. Dec. 535 (lS69) ; Spalding v. Bwing, 
 149 Pa. 375, 24 Atl. 219, 15 L. B. A. 727, 34 Am. St. Rep. 608 (1892) ; Cbijiiil- 
 lard's Adm'r v. Bearss, 21 Ind. 479, 83 Am. Dec. 362 (1863). 
 
Sec. 8) CONTRACTS INDUCING CRIME OR PRIVATE WRONG 1335 
 
 The third is a common count alleging the indebtedness of the tes- 
 tator to the defendant for work and labor to the amount of $12,975. 
 
 It appears by the bill of exceptions that the plaintiff called three 
 witnesses to establish the contract upon which he sought to recover. 
 Lovel testified that "the testator also stated that he had agreed to pay 
 the plaintiff .one-half of all the fees he should receive in said cases, for 
 his aid in getting the appointment of special counsel and for the assist- 
 ance which the plaintiff was to render in procuring testimony and 
 giving information for the management of the defence in said cases." 
 
 "On cross-examination, the witness said he knew, before his said 
 conversation with R. M. Corwine, and before Corwine was employed, 
 that Mr. Meguire, the plaintiff, had the selection of counsel in said 
 cases, the Treasury Departnient only restricting him to the selection 
 of a man who was familiar with admiralty practice, and Mr. Meguire 
 was to utilize the information he professed to have at that time. ,The 
 bargain, as witness understood it, was that in consideration of Me- 
 guire's procuring Corwine to be employed as special counsel in those 
 cases, and of assisting him In getting evidence and information, Cor- 
 wine agreed to pay to the plaintiff (Meguire) one-half of the fees 
 which he (Corwine) might receive from the United States fof services 
 in said cases. 
 
 "The plaintifif then called Lewis S. Wells, another witness in his 
 behalf, who, being duly sworn, stated that since the commencement 
 of this suit— -he; thought some time last year— he met the testator (R. 
 M. Corwine, deceased) in the Treasury Department, and had a con- 
 versation with him about tile plaintiff and the Karragut cases. Mr. 
 Corwine was very angry, and said that he had agreed to pay Mr. 
 Meguire one-half of his fees in the Farragut cases, and had paid him 
 one-half the retainer received in 1869, and $4,000 in July, 1873, and 
 had taken his receipt in full. That he had found out that plaintiff 
 had not been the means of his appointment as special counsel, and he 
 thought he had paid the plaintiff enough." 
 
 Wells testified further that upon two occasions the testator told 
 him the plaintiff was assisting him in the preparation of the defence in 
 the Farragut cases, and that he had agreed to pay to the plamtiff one- 
 half of his fees for the plaintiff's services. This is all that iS found 
 in the record touching the terms and consideration of the contract, it 
 was in proof by a late soHcitor of the treasury that the plaintiff strong- 
 ly urged on him the employment of the testator as special counsel, and 
 that at the instance of the plaintiff he called the attention of the Sec- 
 retary of the Treasury to the subject, and that the appointment of 
 the testator was thus brought about. The plaintiff had been a clerk in 
 New OreanI in the office'of Colonel Holabird, Chief Quartermaster 
 ofThe Department of the Gulf, during the war, and had possession 
 of Holabird's papers, fi-om which he derived the facts communicated to 
 Sie te tator ftfr ?he defence of government in the prize suits m^ques. 
 ion It was not controverted that the amount of fees received by the 
 
1336 ILLEGAL .CONTRACTS , (Ch. & 
 
 testator was $25,950, and that he paid ovef to the plaintiff $4,475 be- 
 fore the breach occurred between them. The further sum of $8,500 
 was claimed by the plaintiff, and. this suit was brought to recover it. 
 The learned counsel for plaintiff in error complains in his brief that 
 "in the charge of the court, page 10, the jury were instructed that 'the 
 contract set out in , the first count of the declaration wa,s illegal and 
 void, and that the plaintiff could not recover on the second count unless 
 the jury should find that the parties made another and a distinct con- 
 tract ; ' 'and in the first instruction asked by the defendants and given 
 by the court the jury were told that such an arrangement is void, be- 
 cause it is contrary to public policy, and the plaintiff cannot recover in 
 any form of action for any services rendered or labor perforrned in 
 pursuance thereof.' * * * 'There can be ho doubt that this charge 
 was fatal to the plaintiff's whole case. The jury were not allowed to 
 infer, as they well might have done from the testimony of more than 
 one of the witnesses, that the testator, after his appointment as special 
 counsel, recognized an implied agreement to pay the plaintiff half of 
 his fees for the services of the latter rendered during the progress of 
 the business.' " 
 
 In our view of the record this is the turnirjg-point of the case. 
 The objection taken to the instructions referred to is not so much to 
 them in the abstract as the concrete. The complaint is that they closed 
 the door against the inference of another contract which the jury 
 might have drawn from the testimony in the case. To- this there are 
 several answers. If there were such testimony, it should have been 
 set forth in the record. After a careful examination, we have been 
 unable to find any. The instructions expressly saved the right of the 
 jury to find another and a different contract, and their attention was 
 called to the subject. They found hone. The contract objected to by 
 the court as fatally tainted was proved by witnesses called by the 
 plaintiff himself. He neither proved nor attempted to prove any 
 other. It was, then, neither claimed nor intimated that any other had 
 been made. After the views of the court were announced, it was too 
 late for the plaintiff to change his position and claim for the jury the 
 right to wander at large in the field of conjecture and find as a fact 
 what the evidence wholly failed to establish, and which, if found, would 
 have thrown on the court the necessity to set aside the verdict and 
 award a new trial. 
 
 A judge has no right to submit a question where the state of the 
 evidence forbids it. Michigan Bank v. Eldred, 9 Wall. 544, 19 L. Ed. 
 763. On the contrary, where there is an entire absence of testimony, 
 or it is all one way, and its conclusiveness is free from doubt, it is 
 Competent for the court to direct the jury to find accorditigly. Mer- 
 chants' Bank V. State Bank, 10 Wall. 604, 19 L. Ed. 1008. The practice 
 condemned in Michigan Bank v. Eldred is fraught with evil. It tends 
 to create doubts which otherwise might not, and ought not to exist, and 
 may confuse the minds of the jury and lead them to wrong conclu- 
 
Sec. 8) CONTRACTS INDUCING CEIMB OR PRIVATE WRONG 1337 
 
 I 
 
 sions. If the instructions here under consideration are hable to any 
 criticism, it is that they were more favorable to the plaintiff in error 
 than he had a right to claim. 
 
 The law touching contracts like the one here in question has been 
 often considered by this court, and is well settled by our adjudications. 
 Marshall v. Baltimore & Ohio Railroad Co., 16 How. 314, 14 L. Ed. 
 953; Tool Company v. Norris, 2 Wall. 45, 17 L. Ed. 868; Trist v. 
 Child, 21 Wall. 441, 22 L. Ed. 623 ; Coppell v. Hall, 7 Wall. 542, 19 
 L,. Ed. 244. It cannot be necessary to go over the same ground again. 
 To do so would be a waste of time. The object of this opinion is 
 rather to vindicate the application of our former rulings to this record 
 than to give them new support. They do not need it. Frauds of 
 the class to which the one here disclosed belongs are an unmixed evil. 
 Whether forbidden by a statute or condemned by public policy, the 
 result is the same. No legal right can spring from such a source. They 
 are the sappers and miners of the public welfare, and of free govern- 
 ment as well. The latter depends for its vitality upon the virtue and 
 good faith of those for whom it exists, and of those by whom it is 
 administered. Corruption is always the forerunner of despotism. 
 
 In Trist V. Child (supra), while recognizing the validity of an 
 honest claim for servites honestly rendered, this court said: "But 
 they are blended and confused with those which are forbidden; the 
 whole is a unit, and indivisible. That which is bad destroys that 
 which is good, and they perish tog^feither. * * * Where the taint 
 exists it affects fatally, in all its parts, the entire body of the contract. 
 In all such cases potior conditio defendentis. Where there is tur- 
 pitude, the law will help neither party." These remarks apply here. 
 The contract is clearly illegal, and this action was brought to enforce 
 it. This conclusion renders it unnecessary to consider the plaintiff's 
 other assignments of error. The case being fundamentally and fa- 
 tally defective, he could not recover. Conceding all his exceptions, 
 other than those we have considered, to be well taken, the errors 
 committed could have done him no harm, and opposite rulings would 
 have done him no good. In either view, these alleged errors are an im- 
 material element in the case. Barth v. Clise, Sheriff, 12 Wall. 400, 20 
 L. Ed. 393. 
 
 Judgment affirmed.^" 
 
 «»See also Robertson v. Robinson, 65 Ala. 610, 39 Am. Rep. 17 (1880), 
 agreement to appoint to a public office; Martin v. Royster, 8 Ark. 74 (1847) ; 
 Stroud v. Smith, 4 Houst. (Del.) 448 (1872 ; Martin v. Francis 173 Ky 
 5™191 S W 259 L. R. A. 1918F, 966, Ann. Cas. 1918B, 289 (1917), rival. 
 candidates agreed tbat one should withdraw, should later be appointed 
 deputy aM should divide fees; Hand v. Willard F. Bailey Co 103 Neb. 450, 
 172 N W 356 (1919),- same; Oscanyan v. Winchester Repeating Arms Co., 
 103 U S '261 26 L. Ed. 539 (1880), agreement to pay a Turkish consul. a 
 commission if he would induce his government to buy rifles ; Osborne v. 
 AmaT. Soc. of Ry. Servants, [1910] A. O. 87 member of Parliament agreed to 
 vote as directed by his union ; Western Indemnity Co. v. Crafts, 240 Fed. 1, 
 153 OCA 37 (1917), surety bond to induce illegal deposit of state funds. 
 
1338 ILLEGAL CONTRACTS (Ch. 9. 
 
 GRANGER v. FRENCJI, City Comptroller, et al. 
 
 (Supreme Court of Michigan, 1908. 152 Mich. 356, 116 N. W. 181, 125 Am. 
 
 St. Rep. 416.) 
 
 Mandamus by Orley C. Granger against Rufus S. French, ciity 
 comptroller of Grand Rapids, and another to compel respondents to 
 pay relator's salary. There was a judgnient denying the writ, and, 
 relator briiigs certiorari. Reversed. 
 
 OsTRANDEE, J.°^ Relator, a justice of the peace of the city of Grand 
 Rapids, with an official salary of $1,300 a year, payable monthly out of 
 the city treasury, assigned unearned salary to obtain money and credit 
 to relieve his financial embarrassment. Respondents are respectively 
 the comptroller and city clerk of the city of Grand Rapids, and have 
 refused to issue to relator the usual checks or warrants for his sal- 
 ary, or to countersign or pay such checks because said assignments of 
 relator's salary have been filed in the comptroller's office. Relator ap- 
 plied to the superior court for a writ of mandamus to compel respond- 
 ents to perform their duties in the premises. The writ, after a hear- 
 ing, was denied. The court found the assignments to have been given 
 to persons who in reliance upon them and in perfect good faith ad- 
 vanced money or credit to relator, and in the opinion the learned judge 
 said: "I cannot bring myself to feel that a court of justice is called 
 upon to lend its aid to the relator in depriving his creditors of the op- 
 portunity of getting from him what he had solemnly promised to give 
 them." 
 
 I think the writ of mandamus should have been granted, not in in- 
 dorsement and appreciation of relator's conduct, nor in furtherance 
 of relator's private interest, but because to deny it is, in effect, to 
 refuse to enforce a rule of sound public policy. Mandamus is the 
 proper remedy to enforce the payment by a mimicipal corporation of a 
 salary, the amount of which is fixed. McBride v. Grand R^-pids, 47 
 Mich. 236, 10 N. W. 353 ; Speed v. Common Council of the City of 
 Detroit and the City Comptroller, 100 Mich, 92, 58 N. W. 638., The 
 assignments of his salary which rela^tor gave are yoid. The rule, with 
 copious references to authorities, is stated in 2 Am. & Eng. Ency. 
 of Law (2d Ed.) 1033, as follows : "It is well settled, both in England 
 and the United' States, that a public officer cannot assign by anticipation 
 the salary and fees paid to him for the purpose of maintaining the dig- 
 nity of his office and securing the due discharge of its duties. The 
 protection thus extended to those engaged in the performance of pub- 
 lic duties is not based upon the ground of their private interest, but 
 upon the necessity of securing the efficiency of the public service by in- 
 suring that. the funds provided for its maintenance shall be received 
 by those who are to perform the work, at the periods appointed for 
 
 01 Part of the opinion is omitted. 
 
'Sec. 8) CONTRACTS INDUCING CRIME OR PRIVATE WRONG 1339 
 
 their payment. The assignment of such fimds before they are due 
 impairs the efficiency of the public service, and is void both in law and 
 equity as being > against public pohcy." See, also, 4 Cyc. 19; Bliss v. 
 Lawrence, .58 N. Y. 442, 17 Am. Rep. 273; In re King's Estate, 110 
 Mich. 203„ 68 N. W. 154. * * * 
 Reversed.®^ 
 
 BAIRD V. SALINA NORTHERN R. CO. et al. 
 
 (Supreme Court of Kansas, 1918. ,103 Kan. 452, ITS Pac. 1069, L,. R. A. 
 
 191SF, 1201.) 
 
 Action by James A. Baird against the Salina Northern Railroad 
 Company and others. Demurrer to petition overruled, and defend- 
 ants appeal. Reversed, and cause remanded, with direction to sustain 
 the demurrer. ' 
 
 BuRCH, J. The action was one, for damages for breach of a contract 
 to locate and maintain a depot and other shipping facilities. A de- 
 murrer to the petition was overruled, and the defendant appeals. 
 
 The contract provided that the railroad company should permanent- 
 ly establish and maintain, on described ' land of the plaintiff, a pas- 
 senger and freight depot and station, stockyards, side tracks, and other 
 shipping, facilities, refrain from ever establishing or maintaining a 
 depot. Station, or siding facilities between Ash Grove in Lincoln county, 
 and the proposed station in Mitchell county, or within 10 miles of the 
 proposed station, do all in its power to obtain for the proposed station 
 post office and express office facilities, to the end that there might be 
 established on the real estate described a town equipped with the neces- , 
 sary shipping, express, and postal facilities, and at the time when the 
 proposed station should be completed, run an excursion train for, or 
 assist in advertising, a sale qi, town lots, free of cost. The considera- 
 tion was the execution and delivery to the railroad company of sub- 
 
 6 2 In accord- Anderson v. Branstrom, 173 Mich. 157, 139 N. W. 40, 43 
 L R A (N S ) 422, Ann. Oas. 1914D. 817 (1912), pooling of fees by a prose- 
 cutins attorney with his law partners ; Bliss y. Lawrence, 58 N. X. 442, 17 
 Am -Ren 273 (1874)' ; Fidelity & Deposit Co. of Maryland v. Long, 138 Tenn. 
 43 iS I' W 766 (1917) ; State v. WUliamson, 118 Mo. 146, 23 S. W. 1054, 21 
 LB A 827 '40 Am. St. Rep. 358 (1893) ; Bangs v. Dunn, 66 Cal. 72, 4 Pac. 963 
 (1884)1 w4lls V. Foster, 8 M. & W. 151 (1841). _ 
 
 Pensions to soldiers and sailors are made unassignable by Rev. St. U. S. 
 S 4745 (U. S. Oomp. St. § 9077). , ^u *v. j- 
 
 A contract by a public officer for: a salary either less or more than that 
 fixtd by itw is void. Rhodes v. City of Tacoma, 9^ Wash 341 166 Pac. 
 647 (1917) less; Dodson v. McCurnin, lY8 Iowa, 1211, 160 N. W. 927, L^R A. 
 iqi70 1084 (1917) more; State ex rel. Attorney General, y. Colher, 72 Mo 
 if 37 Am Rep 417 (1880) ; Brown v. First Nat. Bank, 137 Ind. 655, 37 
 N B 158 24 iT R. A. 206 (1893) :^ Southern Bell Telephone & Telegraph Co. v. 
 Mitciiefl 145 Ga 539, 89 S. B. 514 (1916), justice of peace agreed to charge 
 no fees, 'if plaintiff would bring suits in his court. 
 
1340 ILLEGAL CONTRACTS (Ch. 9 
 
 scription notes in the sum of $10,000, with an option to give notes to 
 the amount of $5,000 and subscribe $10,000 to a bond issue of the rail- 
 road company. Should the railroad company default in performing 
 any portion of the contract, it was to pay the plaintiff the sum of $5i000 
 as liquidated damages. 
 
 The petition set out the contract, pleaded performance by the plain- 
 tiff and breach by the defendant, and prayed for the stipulated dam- 
 ages. The contract was void, because contrary to public policy, and 
 the demurrer to the petition should have been sustained. 
 
 The plaintiff argues that it is not per se against public policy to bar- 
 gain with a railroad company for the location of a station at a par- 
 ticular place; that stations may, of course, always be discontinued 
 when it is proper to do so, and consequently the stipulation for a 
 permanent station may be ignored ; and that the admittedly void stip- 
 ulation not to establish other stations is severable. The plaintiff is 
 not able to point out what part of his subscription was made in consid- 
 eration of the naked location of a station on his land, with accompany- 
 ing shipping facilities. On the face of the contract material portions 
 of the consideration on which the plaintiff made his subscription were 
 that the station should not be discontinued as soon as established, or at 
 any later time, but should be permanent, and that no other station 
 should be located within competing distance. To interpret the contract 
 otherwise would be to make a decidedly different engagement between 
 the parties than that expressed by the instrument. The supposedly legal 
 and the illegal things to be done by the railroad company constituted 
 a unit of performance on its part, just as the plaintiff's subscription 
 constituted a unit of performance on his part, and the entire contract 
 was void. 
 
 The court does not agree that the contract would have been valid if it 
 had contemplated no more than the establishing of the station and 
 shipping facilities described. The public has an interest in the loca- 
 tion of stations on a line of railroad, with the accompanying facilities 
 for serving the public. That interest is paramount to the interest of 
 stockholders of the railroad company, and the temptation to gratify 
 private greed, rather than satisfy public need, by selling out railroad 
 facilities, is just great enough that railroad officers and agents ough.t 
 not to be permitted to expose themselves to it. The authorities on the 
 subject of the validity of station contracts are not in harmony, suid it 
 is not strange that this should be so. On one side transportation by 
 rail is private enterprise ; on the other public service ; and the suprem- 
 acy of the public interest was not always clearly visuaUzed. Indeed, 
 it was often difficult to do so in the early days of railroad building 
 through great areas of undeveloped territory. Public policy as an op- 
 erative legal principle was not always clearly visualized. Sometimes 
 the statutory privileges enjoyed by railroad builders and the statutory 
 ^privileges permitted municipal and quasi municipal coiporations in 
 
Sec. 8) CONTRACTS INDUCING CRIME OR PRIVATE WRONG 1341 
 
 securing the extension to them of railroad facilities confused the ap- 
 plication of the doctrine of public policy to private contracts.*"' * * * 
 
 Some state and federal courts hold that, because municipal and quasi 
 municipal corporations may contract for the location of stations, the 
 general public policy of the state is thereby established, and private 
 individuals have the same right. This reasoning is quite fallacious. 
 In one case a public body, the municipal authorities, acting ordinarily 
 on a vote of the qualified electors is permitted to contract according 
 to the interest of the locality. In the other, private individuals, in fur- 
 therance of their own selfish ends, strive to secure especial advantages 
 and privileges, without regard to the public welfare. 
 
 The decisions noted are all that have been rendered by this court 
 throwing direct light on the subject under consideration. They do not 
 commit the court to a holding that a town-site promoter like the plain- 
 tifif may secure a lawful contract binding the railfoad company to estab- 
 lish on his land a passenger and freight depot and station, stock yards, 
 and other shipping facilities, and the court declines so to hold. It is a 
 mere quibble to speak of establishing structures and facilities of the 
 character described, as distinct from maintaining them, because to 
 establish is to fix with appropriate permanence. The field was open 
 to rival promoters to offer more alluring inducements to the railroad 
 company to champion their town sites, and in such a contest the pub- 
 lic interest is too likely to be found trailing after the successful bidder. 
 
 The judgment of the district court is reversed, and the cause is 
 remanded, with direction to sustain the demurrer to the petition. All 
 the Justices concurring.'** 
 
 PALMBAUM V. MAGULSKY. 
 
 (Supreme Judicial- Court of Massachusetts, 1914. 21T Mass. 306, 104 N. E. 
 746, Ann. Cas. 1915D, 799.) 
 
 Action by Joseph Palmbaum against Abraham M. Magulsky. There 
 was a verdict for defendant, and plaintiff brings exceptions. Sustain- 
 'ed, and judgment entered for plaintiff. 
 
 «3 Tlie court here reviewed earlier Kansas decisions. 
 
 6* Contracts to induce the location of a post office. Elkhart County Lodge 
 V Crarv 98 Ind. 238, 49 Am. Kep. 746 (1884) ; Benson v. Bawden, 149 Mich. 
 584 113 N. W. 20, 13 L. R. A. (N. S.) 721 (1907) ; Davis v. Bolon (Okl.) 177 
 Pac 903 (1919), contract to use "pull" with the Post Office Department. 
 
 Contracts tending tO' induce a public service corporation to neglect its 
 public duty New Tork Central K. Co. v. Lockwood, 17 Wall, 357, 21 L. Ed. 
 627 (1873) contract to exempt can-ier from liability for negligence; Wood- 
 stock Iron Co. V. Richmond & D. Extension Co., 129 U. S. 643, 9 Sup. Ct. 
 ^02 32 L Ed 819 (1889), payment to induce the location of a railroad at a 
 certain place; Fuller v. Dame, 18 Pick. (Mass.) 472 (1836), location of 
 depot But it is not illegal for a town to make a subscription to a railway 
 company to induce the construction of a road there. Farrington v. Stucky, 
 165 Fed. 325, 91 C. C. A. 311 (1908), 
 
1342 fLLBGAt/ OONTEAOTS (Ch. 9 
 
 Crosby, J.°' This is an action of contract upon a promissory note 
 executed and delivered by the defendant to the plaintiff for money ad- 
 vanced by him (the plaintiff) to the defendant, with which he (the de- 
 fendant) purchased certain shares of stock in a corporation known as 
 the American Biscuit Company, in which the plaintiff and one Hoff- 
 man were also shareholders. The stock so purchased by the defend- 
 ant was held by the plaintiff by assignment to secure the payment of 
 the note. It appeared at the trial that about two years after the 
 note was given the defendant agreed with the plaintifif, in con- 
 sideration of the plaintiff's surrendering the note, to attend a stock- 
 holders' meeting of the corporation and vote with the plaintiff to dis- 
 pose of all the assets of the corporation which, according to the re- 
 port, amounted to several thousand dollars. Among other defens- 
 es in his answer and amended answer, the defendant alleged that 
 he had performed hi^ part of the foregoing agreement. The excep- 
 tions set forth substantially all the evidence introduced . at the trial, 
 from which it appears that the defendant is liable upon the note, un- 
 less his performance of the agreement is a valid defense. 
 
 The defendant testified to the making of the agreement and that he 
 had carried out his part thereof, and offered other evidence to the 
 same effect. There was no evidence that the only other stockholder, 
 Hoffman, assented to the agreement or had any knowledge of 
 
 1+ "f ^r ^ 
 
 The court instructed the jury that the agreement, if proved, consti- 
 tuted a defense to the action, to which the plaintiff excepted. 
 
 In our opinion the court should have ruled that the agreement was 
 not a defense, and should have instructed the jury to return a verdict 
 for the plaintifif in accordance with his first request. 
 
 It is the duty of a stockholder of a corporation, in attendance at 
 meetings of the stockholders, to act fairly and in good faith. He is 
 not justified in entering into any agreement to vote so as to perpetrate 
 a fraud upon another stockholder. The defendant's vote to dispose of 
 all the assets of the corporation was in consideration of the surrender 
 of the note to him by the plaintiff. This was illegal, and the agree- 
 ment v/as void as against public policy. 
 
 As was said by Colt, J., in Guernsey v. Cook, 120 Mass. 501, 502 : 
 "It was the purpose and effect of the contract .to influence the de- 
 fendant, in the decision of a question affecting the private rights of 
 others, by, considerations foreign to those, rights. The promisee was 
 placed under direct inducement to disregard his duties to other mem- 
 bers of the corporation, who had a right to demand his disinterested 
 action in the selection of suitable officers. He was in a relation of 
 trust and confidence, which required him to look only to the best inter- 
 est of the whole, uninfluenced by private gain. The contract operated 
 
 *5 Part of the opinion is omitted. 
 
Sec. 8) CONTRACTS INDUCING CRIME OR PRIVATE WRONG 1343 
 
 as a fraud upon his associates." The contract in the case now before 
 us operated as a fraud upon Hoffman. 
 
 . Where an agreement is made which is either contrary to public pol- 
 icy or fraudulent as to third parties, it will not be enforced, although 
 in tlie particular instance no injury may have resulted. Gibbs v. 
 Smith, 115 Mass. 592. 
 
 In the case of Woodruff v. Wentworth, 133 Mass. 309, this court 
 held that ^e agreement of a stockholder in a private business corpora- 
 tion to vote for a certain person as manager, and to vote to increase 
 the salaries of the officers including that of the manager, was void as 
 against pubUc policy, unless it was consented to by all the stockholders 
 of the corporation. 
 
 In the case at bar the agreement of the defendant to vote to dispose 
 of all the assets of the corporation without the knowledge or assent of 
 Hoffman was a corrupt bargain and unlawful, and cannot be availed 
 of by him as a defense to the note. See West v. Camden, 135 U. S. 
 507, 10 Sup. Ct. 838, 34 L. Ed. 254; Old Dominion Copper Mining 
 & Smelting Co. v. Bigelow, 203 Mass. 159, 198, 199, 89 N. E. 193, 40 
 L. R. A. (N. S.) 314; Northwest Transportation Co., Limited, v. 
 Beatty, 12 App. Cas. 589; Costello v. London, General Omnibus Co., 
 107 L. T. 575. 
 
 The exceptions should be sustained, and as substantially all the evi- 
 dence in the case is before us, and as it appears therefrom that there 
 was no defense t(^ the note, judgme^t should be entered for the plain- 
 tiff under St. 1909, c. 236. 
 
 So ordered." « 
 
 66 See also, Timme v. Kopmeier, 162 Wis, 5T1, 156 N. W. 961, L. K. A. 
 W16D 1114 (1916), contract by director of a corporation with its manager 
 to buy the latter's stock at a fixed price whenever the latter should cease to 
 be manager; Guernsey v. Cook, 120 Mass. 501 (1876), same; Kregor v. 
 HolUns^C A ) 109 L. T. 225 (1913), rule is otherwise, if all the stockholders 
 consen?; Thomas v. Matthews, 94 Ohio St. 32, 113 N. E. 669, K B A 1917A, 
 1068 (1916), payment to a director to influence his action; Moss v Copelof, 
 231 Mass. 513ri21 N. E. 508 (1919) ; West v. Camden, 135 U. S. 507, 10 Sup 
 rt 8Sfi ^4 T^ Ed 254 (1890) : Haldeman v. Haldeman, 176 Ky. 635, 197 
 iNf 376 (m7) ;■ icrippsv: Sweeney. 160 Mich. 161, 125 N W 78 (1910) 
 %^ agreement between stockholders that the president and directors should 
 be merlTyTominal or "dummy" oflBcers, the real control being in one stock- 
 MdTryllXal -aearly the law does not P^™* t'^|„3«^^<^'^f ^^^^^^^ 
 create a sterilized board of directors." Manson v. Curtis, 223 N. Y. 313, ll!J 
 
 VVo'ting^Tust^rgrL'S wLS'ke stockholders deprive themselves of 
 voting wwer and confer it upon trustees is not invalid when done for a 
 proper ^^se Clark v. Foster, 98 Wash 241, 167 Pae 908 (1917) ; Ecker 
 V. Kentucky Refining Co., 144 Ky. 264, 138 S. W. 264 (1911). 
 
1344 ILLEGAL COlirTUACTS (Ch. 9 
 
 EBERT V. HASKELU 
 
 (Supreme Judicial Court of Massachusetts, 1914. 217 Mass. 209, 104 N. 
 
 E. 556.) 
 
 Action by Clarence E. Ebert against George D. Haskell. Verdict 
 for defendant, and case reported. Judgment ordered to be entered for 
 defendant on the verdict. 
 
 The second count of the declaration was as follows : * 
 
 "Now conies the plaintiflf in the above-entitled action and says that 
 on or about October 1, 1909, having been duly authorized by the trus- 
 tees of the Young Men's Christian Association of the city of Boston to 
 sell some property situated at that time at the corner of Berkeley and 
 Boylston streets, he offered said property for sale to the' defendant and 
 that the defendant promised him that if he, the defendant, could ef- 
 fect a sale of the property to any of his, the defendant's, clients, he 
 would pay the plaintiff one per cent, of the purchase price, provided 
 however, that the plaintiff would promise not to mention to the trustees 
 of the Y. M. C. A. the fact that the defendant was considering a pur- 
 chase of the property; that the plaintiff did so promise and did faith- 
 fully keep said promise. That thereafter the defendants did effect a 
 sale of said property to one of his, the defendant's, clients, whereupon 
 the one per cent, of the purchase price became due and payable to the 
 plaintiff. That although the plaintiff has demanded of the defendant 
 said one per cent, of the purchase price he has utterly failed to pay 
 the same. Wherefore the defendant owes the plaintiff one per cent, 
 of the purchase price of the property with interest. That throughout 
 the whole proceedings heretofore mentioned the plaintiff has fully kept 
 his side of the bargain and all promises made by him, whereas the de- 
 fendant has broken his promises and has failed to keep^his side of the 
 bargain." ' 
 
 Sheldon, J."' The- plaintiff was not a mere middleman cliarged 
 with no other duty than that of bringing possible purchasers into com^ 
 munication with the owner of the property. In the second count of 
 his declaration, the only one upon which he relied at the trial, he aver- 
 red that he had been authorized by the trustees of the Young Men's 
 Christian Association to sell the property, and that he offered it for 
 sale to the defendant. His testimony at the trial, although apparently 
 he sometimes sought to avoid calling himself a broker, was to the same 
 effect. But in legal intendment he described himself always , as an 
 agent or broker, arid not as a mere middleman. Accordingly he owed 
 to the owner all the duties of a broker employed to sell the property, 
 and not merely those of a middleman who undertakes nothing more 
 than to bring the parties together and leave them to make their own 
 bargains. It follows that such cases as Rupp v. Sampson, 16 Gray,- 
 398, 77 Am. Dec. 416, can give him no comfort. 
 
 As such a broker the plaintiff was bound not to put himself in a posi- 
 
 8^ Part of the opinion is omitted. 
 
Sec. 8) OONTKACTS INDUCING CRIME OR PRIVATE WRONG 1345 
 
 tion antagonistic to the owner's interests. Quinn v. Burton, 195 Mass. 
 277, 81 N. E. 257. And he could not enforce against any party to the 
 transaction an agreement by which he should pledge himself to con- 
 duct inconsistent with this obligation on his part. There was a fidu- 
 ciary^ relation between the plaintiff and his principal, the owner of the 
 property, and he was bound, not only to exert his skill and best efforts 
 for the benefit of his principal, but to disclose to the latter all facts 
 material to the transaction which should come to his own knowledge. 
 Young V. Hughes, 32 N. J. Eq. 372; Beury v. Davis, 111 Va. 581, 588, 
 69 S. E. 1050; Pratt v. Patterson, 112 Pa. 475, 3 Atl. 858; Hobart v. 
 Sherburne, 66 Minn. 171, 68 N. W. 841. He can enforce no agree- 
 ment relating to the sale of the property, made by him either with his 
 principal or with a third party, by which he undertakes to do anything • 
 or to subject himself to the temptation of doing an)^hing inconsistent ' 
 with the full discharge of his obligations towards his principal. Sul- 
 livan V. Tufts, 203 Mass. 155, 89 N. E. 239. The courts will refuse to 
 enforce such a contract, not merely if its avowed purpose is to bring 
 about the doing of unlawful acts, but if by making it and complying 
 with it the plaintiff put himself into a position where there was a 
 strong inducement for him to violate his duty to his principal, where he 
 became subject to a wrong influence to do what might affect injurious- 
 ly the interests of his principal. Fuller v. Dame, 18 Pick. 472, 481. 
 If this was the case, it is not material whether the principal actually 
 suffered loss or injury. Quinn v. Burton, 195 Mass. 277, 279, 81 N. 
 E. 257, and cases there cited. 
 
 The name of the proposed purchaser, or of the firm by which the 
 defendant was employed and which stood in the position of a pur- 
 chaser, was highly material here, especially in view of the fact that the 
 plaintiff's claim is that the reason for the purchaser's desire to keep 
 this secret was, as the plaintiff was informed, an apprehension that if 
 the name was made known a higher price might be demanded for the 
 property. In this respect the case is unlike Veasey v. Carson, 177 
 Mass. 117, 58 N. E. 177, 53 L. R. A. 241. See Pratt v, Patterson, 112 
 Pa. 475, 479, 3 Atl. 858; Wilkinson v. McCullough, 196 Pa. 205, 46 
 Atl. 357, 79 Am. St. Rep. 702; Young v. Hughes, 32 N. J. 
 Eq. 372. * * * 
 
 Judgment must be entered for the defendant on the verdict. «* 
 
 68 Contracts to induce an agent, attorney, or trustee to commit a breach of 
 trust ■ Smith v. David B. Crockett Co., 85 Conn. 282, 82 Atl. 569, 39 L. R. 
 A. (N. S.) 1148 (1912) ; Spinks v. Davis, 32 Miss. 152 (1856), an attorney 
 agreed for a consideration to become administrator of an estate and then 
 collect a debt due plaintiff from the deceased; Holcomb v. Weaver, 136 Mass. 
 265 (1884), a contractor promised an agent a commission for having recom- 
 mended the former to his principal ; Sirkin v. Fourteenth St. Store, 124 App. 
 Div 384 108 N. T. Supp. 830 (1908), bribe to agent to induce him to enter 
 into a contract on behalf of his principal ; Haymond v. Hyer, 80 W. Va. 594, 92 
 S E 854 L R. A. 1918B, 1 (1917), contract by an executor for secretly pur- 
 chasing part of the estate; Greenberg v. Evening Post Ass'n, 91 Conn. 371, 
 99 Atl. 1037 (1917), bribe paid to cause corrupt award of a prize. 
 
 CORBIN CONT. — 85 
 
1346 ILLEGAL CONTRACTS (Ch. 9 
 
 HOSFORD V. ENO. 
 
 (Supreme C!ourt of South Dakota, 1918. 41 S. D. 65, 168 N. W. T64, L. K. A. 
 
 1918F, 831.) 
 
 Action by P. A. Hosford against D. G. Eno. From a judgment for 
 plaintiff, defendant appeals. Reversed and remanded. 
 
 McCoy, J. Plaintiff, as an attorney at law, instituted this action to 
 recover from defendant the sum of $400 and interest, under a con- 
 tract retaining him to . act as attorney for defendant. Defendant 
 answered, admitting the contract, but denied that plaintiff had ever 
 rendered him any service as attorney by virtue thereof, and that there 
 had been no consideration for said contract under which plaintiff seeks 
 ■ to recover. Defendant also alleged that said contract was illegal and 
 void as being against public policy, by reason of facts hereafter ap- 
 pearing. There was verdict and judgment in favor of plaintiff, and 
 defendant appeals. 
 
 The sole question to be determined in this case is whether the re- 
 spondent, who was city attorney of Platte, charged with the duty of> 
 prosecuting appellant for a violation of the ordinances of said city, 
 might legally accept employment from defendant to represent him 
 in the circuit court, or out of court, on a criminal charge against ap- 
 pellant arising out of the same transaction, upon which was based the 
 prosecution for the violation of the said city ordinances. It is the 
 contention of appellant that it is against public policy and sound legal 
 ethics to permit respondent to accept such services or enter into a 
 contract to perform services for appellant under such circumstances, 
 and that therefore the contract sued upon was void and of no effect. 
 We are of the view, and so hold, that the contention of appellant is 
 right. It appears from the record beyond all question that appellant 
 had been arrested for violating certain ordinances of the city of 
 Platte, and that the respondent then and there held the office of city 
 attorney of that city, and was charged by law with the duty of prosecut- 
 ing appellant for the violation of said ordinances, and that after the 
 said arrest of appellant, the respondent entered into a contract where- 
 by the respondent agreed, for the sum of $400, to represent and de- 
 fend appellant, either in or out of the circuit court, against a criminal 
 charge in relation to the same subject-matter and transaction upon 
 which the charge for violating the city ordinances was based ; in other 
 words, the respondent by entering into said contract placed himself in 
 the position of attempting to serve two masters at once whose interests 
 were legally hostile to each other. 
 
 One of the professional services incident to the office of city at- 
 torney is the duty of prosecuting actions brought on behalf of the 
 city for violation of its ordinances. The contract entered into by re- 
 spondent with appellant was in direct conflict with his duties as city 
 attorney. The rule is rigid, and designed not alone to prevent the 
 
Sec. 8) 30NTRACTS INDUCING CEIME OR PRIVATE WRONG 1347 
 
 ^^EI^^^'J^'^ ^"d-l-t conduct, but as well 
 
 ^1,,^^ 4.U 1. -'""1 iia.uuuiciu conauct, Dut as well to ore- 
 
 i"ll?L^°.!?!!iP?^^'^^^"^'- f":"- pitting himself in a position whe" 
 
 id tc 
 ;e tc 
 
 V^T'a ^7qT^I' ^"^^""^^^^ Association7i83"irr 97, TsW.U^eys',!? 
 
 hp ma,, K» .^„„- -^-r: 7""' "^'^^^ puiuug nimseii in a position whe 
 he may be required to choose between conflicting duties or be led 
 attempt to reconcile conflicting interests, rathef than to enforce 
 their full extent the rights of the interest which he should alone 
 
 to 
 to 
 
 k" ?• / ?■ ^",^"o™ey cannot recover for legal services rendered 
 by him both to plamtiflc and defendant concerning the same trans- 
 action. A lawyer, under no circumstances, can recover for services 
 rendered to parties havmg opposing interests growing out of the same 
 circumstances. MacDonald v. Wagner, 5 Mo. App. 56. 
 
 Based upon statute, and every consideration of professional ethics 
 it IS generally held by all courts that an attorney that has once been 
 made the recipient of the confidence of a client concerning certain 
 subject-matter is thereafter disqualified from acting for any other 
 party adversely interested in the same subject-matter. State v. Rock- 
 er, 130 Iowa, 239, 106 N. W. 645. In the case of In re Cowdery, 69 
 Cal. 32, 10 Pac. 47, 58 Am. Rep. 545, a disbarment proceeding, where 
 Cowdery was acting for the city and county of San Francisco, and was 
 charged with the duty of handling certain litigation on the part of 
 said city and county then pending, entered into a contract to defend in 
 such cases after his term of office had expired, the court said : "Prop- 
 er public policy dictates that one employed by the choice of the people 
 for a stated period in the capacity of an attorney and counsel for the 
 state, or any portion of it, should not be allowed to say that he had 
 received no confidential communications in his official capacity, and 
 therefore he was at liberty to be retained by the adversaries in the 
 same case after his term of office had expired. It would be placing 
 before gentlemen of the bar a temptation to neglect their duties when 
 acting in such public employment which no principle of law justifies. 
 A just pubHc policy forlsids it." 
 
 In the case at bar the contract was entered into to defend appel- 
 lant while respondent was still acting as city attorney and before his 
 term of office had expired. A contract of this character might have a 
 tendency to cause the city attorney of Platte to be more lenient and 
 to more readily disregard the legal duties he owed to said city. As 
 city attorney he was presumed to have become acquainted with all 
 the facts upon which the prosecution by the city was based. Hence 
 we are of the view that the contract in question was wholly void as 
 being against public policy. 
 
 While having no binding force as a judicial decision or legislative 
 act, but as indicating the general view of members of the bar, we call 
 attention to the following provisions of the "Canons of Ethics," adopt- 
 ed by the American Bar Association and the Bar Association of this 
 state: "It is unprofessional to represent conflicting interests, except 
 by express consent of all concerned, given after a full disclosure of 
 the facts. Within the meaning of this canon, a lawyer represents 
 
1348 ILLEGAL CONTRACTS (Ch. 9 
 
 conflicting interests when, in behalf of one client, it is his duty to con- 
 tend for that which duty to another client requires him to oppose." 
 
 The judgment' and order appealed from are reversed, and the cause 
 remanded, for further procedure in harmony with this decision. °* 
 
 PITTSBURGH DREDGING & CONSTRUCTION CO. v. MO- 
 NONGAHEI.A & WESTERN DREDGING CO. 
 
 (Circuit Court of the United States, 1905. 139 Fed. 780.) 
 
 BuFFiNGTON, District Judge. This is a motion to enter judgment on 
 reserved points in a suit by the Pittsburgh Dredging & Construction 
 Company against the Monongahela & Western Dredging Company, 
 brought to recover one-half the profits earned by defendant on cei^tain 
 dredging done by it. The facts established by the verdict or uncon- 
 troverted in the proofs are these : In June, 1904, the Jones & Laiigh- 
 lin Steel Company were required by the United States engineer in 
 charge of the Monongahela river to remove a large body of slag from 
 the shore bed of that stream. In pursuance of this requirement the 
 steel company requested bids from the plaintiff and defendant dredg- 
 ing companies. Thereupon these companies entered into an agreement, 
 followed by a written contract, whereby defendant was to bid $1.60 
 and plaintiff $1.70 per cubic yard for the dredging required by the 
 government, and, whichever party received the contract, each was to 
 have one-half the work. Bids were made accordingly, the plaintiff's 
 netting from $4,500 to $5,000 in excess of defendant's. The defend- 
 ant alleged these bids were rejected, that the requirements of the 
 government engineer were changed, and thereupon it bid $1.25 on the 
 changed requirements. It contended this bid was for another and 
 different requirement from that contemplated by the contract, and its 
 bid was not covered by such contract. The finding of the jury, how- 
 ever, established the fact that the bid of the defendant and the work 
 awarded were enxbraced by the contract referred to, and that the 
 plaintiff tendered performance of one-half thereof. The proofs' 
 show the work was actually done by defendant at a cost of 9 cents 
 per cubic yard. The Jones & Eaughlin Company knew nothing of 
 the contract between these parties until the work was finished. On 
 the trial a verdict was rendered in favor of the plaintiff for $3,439.50, 
 subject to the questions involved in the defendant's fifth and sixth 
 points, which were, respectively: "That the agreement of June 16, 
 1904, constituted a conspiracy to defraud the Jones & Laughlin 
 Steel Company, and was illegal and void, and no action can be main- 
 
 8»Kearley v. Thompson, 24 Q. B. D. 742 (1890), attorney received a pay- 
 ment to induce him not to cross-examine a witness ; Warner v. Flack, 278 
 111. 303, 116 N. E. 197, 2 A. L. R. 423 (1917), attorney paid to induce him to 
 give his client certain advice. 
 
Sec. 8) CONTRACTS INDUCING CRIME OR PRIVATE WRONG 134& 
 
 tained thereon, and the verdict must be for the defendant;" and 
 "that the agreement of June 16, 1904, constituted a combination in 
 restraint of trade, and was illegal and void, and no action can be 
 maintained thereon, and the verdict must be for the defendant." 
 The defendant now moves for judgment thereon. 
 
 From the terms of the contract, the fact that it was not disclosed 
 to the Jones & Laughlin Company, and the uncontradicted testi- 
 mony proved on the part, of the ; plaintiff by Smoot, one of the de- 
 fendant's officers, who says, "Well, the defendant and the plaintiff 
 —we had a meeting, and we decided we could fix this thing up and 
 make some money out of it, and get a pretty good price, and we 
 maM prices on it," it is clear that the purpose of the contract was 
 to mislead the steel company into the belief there was competitive 
 bidding between the two companies, and by this collusive bidding 
 secure the contract for their joint benefit. The plaintiff, then, be- 
 ing driven to tlie necessity of showing such a contract as the founda- 
 tion of its ri:ght to recover, will the law lend its aid to enforce such 
 an agreement? The answer to this turns on the question whether 
 this is an illegal contract, for, as Lord Kenyon said, "It is a maxim 
 in our law that a plaintiff must show he stands on fair ground when 
 he calls a court of justice to administer reUef to him," and to the 
 same effect is the holding of the Supreme Court in McMuUen v. 
 Hoffman, 1^4 U. S. 654, 19 Sup. Ct. 845, 43 L. Ed. 1117, namely: 
 "The authorities from the earliest tinie to the present unanimously 
 hold that no court will lend its assistance in any way towards car- 
 rying out the terms of an illegal contract. In case any action is 
 brought in which it is necessary to prove the illegal contract in or- 
 der to maintain the action, courts will not enforce it, nor will they 
 enforce any alleged right directly springing from such contract." 
 It will be observed that when the law refuses to be used to enforce 
 an unlawful contract itl is not done to benefit or aid, the party who 
 has profited by the wrong, and who is in possession of the fruits of 
 the fraud, but on the higher ground of public poHcy. This may re- 
 sult in a wrongdoer profiting by his own wrong, but to transfer the 
 m'oney to the other wrongdoer would equally enable that other to 
 profit by his unlawful act. But assuredly the party who is thus left 
 remediless cannot justly complain, for if, for the purposes of legal 
 relief, the parties are without remedy, they have outlawed themselves, 
 and the law wisely holds aloof, and leaves without its aid those whose 
 deliberate purpose was to transgress its provisions. Nor is it neces- 
 sary that the objectionable contract actually perpetrate a fraud, or that 
 any wrong should have been done to any one. It is the nature and ob- 
 ject of the contract, apart from the fact, whether wrong actually from 
 it results, that bars its enforcement. "The law looks to the general 
 tendency of such contracts. The vice is in the nature of the contract, 
 and it is condemned as belonging to a class which the law will not 
 
1350 ILLHGAIy CONTRACTS (Ch. 9 
 
 tolerate. * * * The vice is inherent in contracts of this kind, and 
 its existence does not in the least depend upon the success which at- 
 tends the execution of any particular agreement." McMuUen v. 
 Hoffman, supra. 
 
 Such being the attitude of the law toward the enforcement of 
 illegal contracts generally, we next inquire whether the one here in- 
 volved was against public policy, and therefore illegal. The purpose 
 of this contract, as stated above, being to create a false appearance of 
 competitive bidding, and by collusive tenders to secure a contract for 
 the joint benefit of the participants, is such a contract against public 
 policy? How such collusive bids stand in the estimate of the Supreme 
 Court is clear. In McMullen v. Hoffman, supra — an agreement for 
 collusive bidding by two bidders for their joint. benefi.t:^it was said: 
 "Upon these facts the question arising is wljether a contract between 
 the parties themselves, such as is above set forth, is illegal. In order to 
 answer the question, we would first naturally ask what is its direct and 
 necessary tendency ? Most clearly that it tends to induce the belief that 
 there is really competition between the parties making the different 
 bids, although the truth is that there is no such competition, and that 
 they are in fact united in interest. It would also tend to the belief on 
 the part of the committee receiving the bids that a bona fide bidder, 
 seeking to obtain the contract, regarded the price he named, although 
 much higher than the lowest bid, as a fair one for the purpose of en- 
 abling him to realize reasonable profits from its performance. A bid 
 thus made amounts to a representation that the sum bid is not in truth 
 an unreasonable or too great a sum for the work to be done. We do not 
 mean it is a warranty to that effect, or anything of the kind, but siniply 
 that a committee receiving such a bid and assuming it to be a bona 
 fide bid would naturally regard it as a representation that the work to 
 be done, with a fair profit, would, in the opinion of the bidder, cost the 
 amount bid. Hence it would almost certainly tend to the belief that 
 the lower bid was not an unreasonably high one, and that' it would be 
 unnecessary and improper to reject all- the bids and advertise for a 
 new letting. * * * jj might readily be surmised that, if these par- 
 ties had bid in competition, one or both of the bids would have been 
 lower than their combined bid. It was not necessary, however to prove 
 so difficult a fact. The inference would be natural. * * * gy^ 
 in this case there is more, even, than concealment. There is the ac- 
 tive fraud in the putting in of these, in substance fictitious, bids, in 
 their different names, but in truth forming no competitive bids, and put 
 in for the purpose already stated. It is not too much to say that the 
 most perfect good faith is called for on the part of bidders at these 
 public lettings, so far as concerns their position relating to the bids 
 put in by them or in their interest. The making of fictitious bids under 
 the circumstances detailed herein is, in its essence, an illegal and most 
 
Sec. 8) CONTEACTS INDUCING CRIME OR PRIVATE WRONG 1351 
 
 improper act; indeed, it is a plain fraud, perpetrated in the effort to 
 obtain the desired result." 
 
 And in Hyer v. Richmond Traction Company, 1,68 U. S. 471, 18 
 Su^. Ct. 114, 42 L. Ed. 547, referring to the agreement in that case, 
 which was for two rival parties to unite (with the full knowledge 
 of the municipal authorities) in procuring the grant of a franchise 
 for their joint benefit, it was said: "The vice which is so frequently 
 detected in contracts and agreements of a similar nature lies in the 
 fact of secrecy, concealment, and deception. The one applicant, though 
 apparently antagonizing the other, is really supporting the latter's ap- 
 plication ; and the public authorities are misled by statements and rep- 
 resentations coming from a supposed adverse but in fact friendly 
 source." 
 
 Now, such being the declared law of the land, why should it not be 
 extended to the case in hand? Because, it is argued, the letting in- 
 volved in the case cited, and in others that might be, were of public 
 works, and the rule does not apply in private lettings. In the absence 
 of any adjudged case binding on this court compelling us to restrict this 
 wholesome principle of public policy to any such narrow limit, we are 
 unwilling to do so. That such secret, collusive biddings tend, or may 
 tend, to mislead public officials, is conceded. But are they resorted to 
 in private lettings for any other than a like purpose to deceive, or are 
 they any less harmful in effect? It is true the personal interest of the 
 individual, as contrasted with the impersonal interest of the public offi- 
 cial, may lead the former to detect more readily the collusive character 
 of the bid ; but, as we will see, the vice of the device consists not in the 
 success of the plan, but in the character of the contract ; and in both let- 
 tings, whethef they be public or private, that vice is the purpose to 
 mislead and deceive. "In all cases where contracts are claimed to be 
 void as against pubHc policy, it matters not that any particular contract 
 is free from any taint of actual fraud, oppression, or corruption. The 
 law looks to the general tendency of such contracts. The vice is in 
 the very nature of the contract, and it is condemned as belonging to a 
 class which the law will not tolerate." Richardson v. Crandall, 48 N. 
 Y 348 cited approvingly in McMullen v. Hoffman, supra. Indeed, the 
 case in hand illustrates that there may be cases where the private let- 
 ting requires the protective shield of the law equally, if not mdeed, 
 more than the public one. If, for example, the government had m this 
 case called for bids to remove this slag, and the two dredging companies 
 here concerned had entered into this agreement to make collusive bids 
 and for a division of profits, and the contract had been awarded one of 
 them it is clear the law would not enforce rights based on such a con- 
 tract' If,.however, the government, instead of itself removing the slag, 
 reauired he company that placed it there to do so, and that company is 
 meTbrthe an.e^ co'llusive^ontract by the same bidders we see no 
 ^ound for alleging the combination was a whit different m purpose 
 
1352 ILLEGAI/ CONTRACTS (Ch. 9 
 
 or effect in the two cases. Indeed, if anything, it would seem the ob- 
 ligation to protect was even greater in the private letting; for while in 
 the letting by the government it was under no pressure to remove, and 
 could therefore refrain from accepting any bid, the private letter was 
 under stress to act, and by reason of that fact the bidders, by their 
 combination, had a correspondingly greater lever to accomplish their 
 purpose to exact any price they saw fit to collusively bid. In Ray" v. 
 Mackin, 100 111. 246, we find the protection of public policy was af- 
 forded a private letting. While the bidding in that case was for paving 
 a public street, the work was done by the property owners ; the entire 
 transaction was with them, and not with the municipality.' The facts 
 were that seven-eighths of the lot owners along a street could, by vir- 
 tue of the provisions of an ordinance, make a private contract to pave 
 it. A number of the lot owners had signed an agreement with Ray & 
 Whitney, a contracting firm. That firm then agreed with Mackin, an- 
 other contractor, to assist him in getting the contract, turn over their 
 signers to him, and bid on the work at a higher price; ■ Mackin agreed 
 to pay them a part of the profits. A committee of the lot owners hav- 
 ing been appointed to receive bids, bids were made by Mackin, and 
 a higher one by Ray & Whitney. The former was awarded the con- 
 tract. When Ray & Whitney brought suit ior their share of the profits 
 on their contract with Mackin, which provided for payment of $1,500 
 of profits "under a private contract made with the property owners 
 on the said avenue, they agreeing to assist me in obtaining the work, to 
 the best of their ability; the money to be paid to Ray & Whitney from 
 time to time as the profit on the work is collected," it was held the con- 
 tract "was clearly against public policy, a,nd a fraud upon the persons 
 who were to pay for the improvement of the street." 
 
 Put into plain language, the purpose of the contract sued on in this 
 case was to make collusive bids, to mislead the letter into a belief that 
 there were competitive bids, and induce an award of the work on that 
 false assumption. That was the purpose and spirit of the contract — 
 the end sought. If the law approves of such an object, it should en- 
 force it; if it disapproves, it should refuse to lend itself to be used to 
 enforce measures it disapproves. When the law which now avails 
 itself of public policy to protect public lettings from collusive biddings 
 finds like obnoxious practices with like deceptive ends in view threaten 
 the integrity of private lettings, we think it would be lacking in virility 
 and progress did it not keep abreast of conditions, and apply this salu- 
 tary principle, where the mischief exists, to all lettings alike. Viewed 
 from the standpoint of morals, square dealing, and commercial in- 
 tegrity, combinations for collusive, misleading biddings, wherever 
 made, cannot be approved ; yet to enforce rights based on an agreement 
 to make such bids is to make the law an active agent to accomplish such 
 deceptive purposes. In view of this result, we think the law should 
 adjudge such agreements void on the broad ground of public policy. 
 
Sec. 8) CONTRACTS INDUCING CRIME OR PRIVATE WRONG 1353 
 
 and accordingly, on the question reserved, viz., "that the agreement of 
 June 16, 1904, constituted a conspiracy to defraud the Jones & Laugh- 
 hri Steel Company, and was illegal and void, and no action can be main- 
 tamed thereon, and the verdict must be for the defendant," we direct 
 the entry of judgment for the defendant. This view renders needless a 
 discussion of the other reserved point.'^" 
 
 FROST V. GAGE. 
 (Supreme Judicial Court of Massachusetts, 1862. 3 Allen, 560.) 
 
 Contract. At the second trial of this case, after the facts reported 
 in 1 Allen, 262, had been proved, the plaintiff offered in evidence a 
 release of their several claims by the creditors of Richard Frost, and 
 Richard testified that, after the release had been signed by the plain- 
 tiff and defendant, the latter procured the signatures of other credi- 
 tors to the same and delivered it to him, and he thereupon executed 
 the assignment to the defendant. The defendant then offered to prove 
 that he was Richard's largest creditor; that the plaintiff, who was 
 Richard's son, requested him to aid in obtaining a settlement with 
 Richard's creditors, and promised to make no claim upon him for any 
 part of the proceeds! of Richard's estate which might come into his 
 hands as assignee, but to allow him to retain the plaintiff's share for 
 his services, and also to execute to him a promissory note for a fur- 
 ther sum, if he would sign the release and procure the signatures of 
 other creditors to the same ; and that he, being induced by said prom- 
 ise, did sign the release and procure the signatures of other creditors to 
 
 loFroMd in AMOtions and in Competitive Bidding. — A secret combination 
 between bidders to suppress competition at a public sale or in any public 
 competitive bidding for a contract is usually held to be an illegal fraud. 
 McMuUen v. Hoffman, 174 U. S. 639, 19 Sup. Ot. 839, 43 I>. Ed. 1117 (1898), 
 between bidders for a municipal contract; Gibbs v. Smith, 115 Mass. 592 
 (1874), private auction; Kuhn v. Buhl, 251 Pa. 348, 96 Atl. 977, Ann. Cas. 
 1917D, 415 (1916), bidder for public contract paid to withdraw; Ives v. 
 Culton (Tex. Civ. App.) 197 S. W. 619 (1917), judicial sale;- Ray v. Mackin, 
 100 111. 246 (1881), private bidding; Doolin v. Ward, 6 Johns. (N. Y.) 194 
 (1810) ; Jones v. Caswell, 3 Johns. Cas. (N. Y.) 29, 2 Am. Dec. 134 (1802) ; 
 Brooks V. Cooper, 50 N. J. Eq. 761, 26 Atl. 978, 21 L. R. A» 617, 35 Am. St. 
 Rep. 793 (1893), public contract; Boyle v. Adams, 50 Minn. 255, 52 N. W. 
 860, 17 X. R. A. 96 (1892), same; Dudley v. Odom, 5 S, C. 131, 22 Am. 
 Rep. 6 (1874) ; Rawlins v. General Trading Co., [1920] 3 K. B. 30. If a seller 
 at auction sale employs a secret puffer, the bidders are not bound. Howard 
 V Castle, 6 T. R. 642 (1796). The secret agreement is illegal. Dealey v. East 
 San Mateo Land Co., 21 Cal. App. 39, 130 Pac. 1066 (1913). Cf. Cahn v. 
 Baccich & De Montluzin, 144 La. 1023, 81 South. 696 (1919) ; Woodworth 
 V. Bennett, 43 N. Y. 273, 3 Am. Rep. 706 (1870). 
 
 A contract to pay one to whom an offer had been made for not accepting 
 the offer, so as to give the promisor a clear field in dealing with the offeror, 
 was held valid in White v. McMath & Johnston, 127 Tenn. 713, 156 S. W. 
 470 44 L. R. A. (N. S.) 1115 (1913) ; Cf. Kincheloe v. Taylor, 123 Va. 178, 96 
 S. E. 167 (1918). 
 
1354 II/LEGAL CONTRACTS (Ch. 9 
 
 the same. Morton, J., rejected this evidence, and the jury returned a 
 verdict for the plaintiff. The defendant alleged exceptions. 
 
 BiGELOw, C. J. The right of the plaintiff to maintain his action on 
 the second count, On proof of the facts therein set forth, was deter- 
 mined at the former hearing' of this case. 1 Allen, 262. The only point 
 now raised which was not then considered by the court arises on the ev- 
 idence offered by the defendant to show that there was an agreement 
 between him and the plaintiff, by which the former agreed to sign the 
 composition deed and procure the release of the other creditors of 
 Richard Frost on a promise by the latter to pay a portion of the debt ' 
 due from said Richard to the defendant, in addition to the dividend 
 which he might receive under the assignment, in common with the' 
 other creditors. That such an agreement would be a fraud on the oth- 
 er creditors, and that the defendant could maintain no action upon 
 it against the plaintiff, is too clear to admit of any doubt. It was a 
 secret and underhand contract by which the defendant secured to 
 himself an advantage over other creditors of the insolvent, while at 
 the same time he was holding out to the same creditors that he was to 
 share in the assets equally with them, and thereby inducing them to 
 sign the composition deed and release the debtor from their claims. 
 Story, Eq. § 378; Cockshott v. Bennett, 2 Term R. 763, 766; I^ewis 
 V. Jones, 4 Barn. & C. 511 ; Case v. Gerrish, 15 Pick. 49. The ques- 
 tion then presents itself, whether such a fraudulent agreement can be 
 set up by the defendant, who was a party to it, as a defense to an 
 action by the plaintiff to recover the same share or dividend of the as- 
 sets of the debtor as has been paid to the other creditors by the defend- 
 ant. This is in some respects a novel question ; but it seems to us to 
 come within principles recognized in the adjudged cases, by the appli- 
 cation of which it can be readily solved. 
 
 Assuming that the defendant could establish all the facts contained 
 in his offer of proof, it is clear that the plaintiff was a party to the 
 fraudulent agreement by which the signatures of the other creditors 
 to the release of the debtor were obtained. It was by his procure- 
 ment, and on a promise by him to pay the defendant a portion of his 
 debt beyond the amount which he would receive from the estate of 
 the debtor, and the letter was induced to sign the release and to be- 
 come the agenf" in procuring' the signatures of the Other creditors. It 
 was -through the procurement and instrumentality of the plaintiff, 
 and by means of an agreement which operated as a fraud on the other 
 creditors, to which he was a party, and for which he furnished the 
 consideration, that the composition and release were obtained. He 
 was therefore a participator in the fraud. Holding the relation of a 
 creditor, and bound to act with good, faith towards the other creditors, 
 in entering mto an agreement with them to. compound with their debtor 
 . an^ to release him from their .debts, he became a party to an agree- 
 ment by which a secret advantage was attempted to be secured to the 
 
Sec. 8) CONTRACTS INDUCING CRIME OR PRIVATE WRONG 1355 
 
 defendant,, by which he was induced to become a party to the assign- 
 ment and release, and thereby to hold out false colors to the other 
 creditors, and lead them to believe that all were acting on equal terms, 
 and to grant a discharge to their debtor on the faith that all were to 
 receive a like portion of their respective debts. To adopt the significant 
 figure which has been used to describe the effect of a transaction of this 
 nature, in Story, Eq. § 378, the plaintiff did not himself act as a decoy 
 diick to mislead the other creditors, but he did that which was quite 
 as effectual in accomplishing the fraud on them ; he procured the duck, 
 and placed him in a position in which^ he was enabled to practice a 
 deception, and to draw the creditors into an arrangement with their 
 debtor to which otherwise they might not have assented. 
 
 In this aspect of the case, we do not see that the plaintiff stands in 
 any better situation, or is entitled to any greater favor in a court of law 
 than the defendant. As participators in the fraud, they both stand 
 on an equal footing. Neither can claim to recover anything in an Ac- 
 tion which can be maintained only by proof of a transaction into 
 any part of which his fraud has entered as an essential element, af- 
 fecting the rights of any parties interested therein. It is on this ground 
 that it has been held that a creditor cannot recover his share or div- 
 idend under a composition deed to which he became a party, if he had 
 previously taken a private agreement for the payment of the residue of 
 the debt. His right to recover the amount to which the fraudulent 
 agreement did not extend is forfeited by his participation in a fraud 
 connected with another part of the same transaction. The, whole is 
 regarded as an entire agreement, which is vitiated by the fraudulent 
 act of the party, as to him, so that he can claim no benefit under any of 
 its provisions. Higgins v. Pitt, ' 4 Exch. 323 ; Knight v. Hunt, 5 
 Bing. 432; Howden v. Haigh, 11 Adol. & E. 1033; Fors. Comp. Cr. 
 152. It is quite immaterial, that the funds to be distributed among 
 other creditors are not diminished or rendered less available in con- 
 sequence of the secret agreement. The fraud consists, not in causing 
 any injury to the assets of the debtor, or in reducing the share or, in- 
 terest to which the creditors are entitled under the composition, but in 
 the attempt to induce them to enter into an agreement for an equal 
 dividend on their debts in ignorance of a private bargain, whereby .a 
 creditor is to receive an additional sum to that to which he may he 
 entitled in common with all the creditors. Such an agreement vitiates 
 the whole transaction, so that the party can claim no benefit under a 
 composition into which he entered in consequence of such corrupt or 
 fraudulent contract. It is quite clear, therefore, that the defendant, if 
 he did not stand in the position of assignee having possession of the 
 assets and yrere compelled to bring an action for the share or dividend 
 on his debt which might be coming to him in common with the other 
 creditors could not recover. The agreement into which he entered 
 with the plaintiff would be a bar to his right to recover even that sum 
 
1356 ILLEGAL, OONTEACTS (Ch; 9 
 
 to which the fraudulent agreement did not extend, f'or a like reason, 
 the plaintiff in this suit ought not to be allowed to recover. The fraud 
 in which he participated, and by which he aided in inducing creditors to 
 become parties to the release of their debtor, taints the whole trans- 
 action as to him, and deprives him of the right of maintaining an action 
 to enforce in a court of law that part of the agreement of composition 
 to which tha secret agreement did not immediately relate. 
 
 It may be suggested that the application of this rule leads in the 
 present case to the result of leaving in the hands of the defendant, 
 who was equally guilty with the plaintiff, the fruits of the fraud. But 
 this is often the consequence of allowing a party to plead in defense 
 the illegality of a transaction on which a cause of action is founded. 
 Such defenses are allowed, not out of favor to defendants, or to pro- 
 tect them from the effects of their imlawful contracts, but on the 
 ground of public policy, which does not permit courts of justice to 
 be" used to aid either party in enforcing contracts which are unlawful 
 or tainted with fraud, but leaves them in the condition in which their 
 (illegal or immoral acts have placed them. 
 
 We are therefore of opinion that the evidence offered at the trial 
 was competent, and that it should have been admitted and submit- 
 .ted to the jury, with instructions in conformity to the principles above 
 stated. 
 
 Exceptions sustained.'^ 
 
 '^ All agree that a secret agreement for a preference of one creditor over 
 others, where the debtor is making a composition and the creditors expect to 
 share alike, is a fraud upon the others and is illegal. Mallalleu v. Hodgson, 
 16 Q. B. 689 (1851) ; White v. Kuntz, 107 N. T. 518, 14 N. E. 423, 1 Am. St. 
 Rep. 886 (1887) ; Cheveront v. Textor, 53 Md. 295 (1879) ; Brown v. Nealley, 
 161 Mass. 1, 36 N. E. 464 (1894) ; Crossley v. Moore, 40 N. J. Law, 27 (1878) ; 
 Tinker v. Hurst, 70 Mich. 159, 38 N. W. 16, 14 Am. St. Kep. 482 (1888). This 
 is true, even though the secret payment is made by a third person and not 
 out of the debtor's funds. KuUman v. Greenebanm, 92 Cal. 403, 28 Pac. 674, 
 27 Am. St. Rep. 150 (1891) ; Brigham v. La Banque Jacques-Cartier, 30 Can. 
 S. C. 429, 2 B. R. C. 449 (1900). 
 
 Hanover Nat. Bank of City of New Tork v. Blake, 142 N. Y. 404, 37 N. B. 
 .519, 27 L. R. A. 33, 40 Am. St. Rep. 607 (1894), differs from Frost v. Gage 
 in holding that the preferred creditor can enforce the composition agreement 
 (although, of course, not the secret preference agreement) against the debtor, 
 the fraud merely causing the composition to be avoidable' at the option of the 
 other creditors. 
 
Sec. 9) 
 
 CONDUCTING BUSINESS WITHOUT A LICENSE 1357 
 
 SECTION* 9.— CONDUCTING BUSINESS (WITHOUT A LI- 
 CENSE 
 
 GRIFFITH V. WELLS. 
 
 (Supreme Court of New York, 1846. 3 Denlo, 226.) 
 
 Griffith sued Wells before a justice of the peace in December, 1843, 
 and declared in assumpsit for two half gallons of whiskey and two 
 glasses of beer, sold and deUvered to the defendant, of the value of 
 three shillings and six pence. The plaintiff, who was a grocer, proved 
 his declaration. The defence was, that the plaintiff sold the liquor 
 without having a license to sell spirituous hquors. The justice gave 
 judgment for the plaintiff for 44 cents damages, besides costs. On 
 certiorari, the C. P. reversed the judgment, on the ground that the 
 plaintiff did not show a license to sell spirituous liquors. The plaintiff 
 brings error. 
 
 Bronson, C. J. Our excise law does not in terms, prohibit the sale 
 of strong or spirituous liquors without a license, nor declare the 
 act illegal; but only inflicts a penalty upon the offender. 1 Rev. SV 
 680, §§ 15, 16. From tliis it is argued, that although the seller without a 
 license incurs a penalty, the contract of sale is valid, and may be en- 
 forced by action. But it was laid down long ago, that "where a statute 
 inflicts a penalty for doing an act, though the act be not prohibited, 
 yet the thing is unlawful ; for it cannot be intended that a statute would 
 inflict a penalty for a lawful act." Bartlett v. Viner, Skin. 322. In 
 the report of the same case in Carthew (pE^e 252), Holt, C. J., said : 
 "A penalty impHes a prohibition, though there are no prohibitory 
 words in the statute." Although this was but a dictum, the doctrine 
 has been fully approved. De Begnis v. Armistead, 10 Bing. 107; 
 Foster v Taylor, 3 Nev. & M. 244, 5 Barn. & Adol. 887; Cope v. 
 Rowlands, 2 Mees. & W. 149; Mitchell v. Smith, 1 Bin. 110, 4 Dall. 
 269 1 L Ed. 828; Seidenbender v. Charles, 4 Serg. & R. (Pa.) 159, 8 
 Am'. Dec. 682, per Tilghman, C. J. ; Bank v. Merrick, 14 Mass. 322. 
 
 When a license to carry on a particular trade is required for the 
 sole purpose of raising revenue, and the statute only inflicts a penalty 
 by way of securing payment of the license money, it may be that a 
 sale without a license would be valid. Johnson v. Hudson 11 East 
 180- Brown v. Duncan, 10 Barn. & C. 93; Chit. Cont. (Ed. 1842) 
 419' 697 But if the statute looks beyond the question of revenue, 
 and has in view the protection of the public health or morals, or the 
 prevention of frauds by the seller, then, though there be nothing but a 
 penalty, a contract which infringes the statute cannot be ^supported : 
 Taw v Hodeson 2 Camp. 147; Brown v. Duncan, 10 Barn. & L. 
 93T Foster v"^ Taylor, 3 Nev. & M. 244, 5 Barn. & Adol. 887; Little 
 
1358 ILLEGAL CONTRACTS (Gh. 9 
 
 V. Poole, 9 Barn. & C. 192; Tyson v. Thomas, McClel. & Y. 119; 
 Wheeler v. Russell, 17 Mass. 258; Bensley v. Bignold, 5 Barn. & 
 Aid. 335; DrUry v. Defontaine, 1 Taunt. 136, per. Mansfield, C. J^.; 
 Cope V. Rowlands, 2 Mees. & W. 149; Houston v. Mills, 1 Moodv 
 & R. 325. 
 
 Now I think it quite clear, that in the enactment of our excise law 
 the legislature looked beyond the mere question of revenue, and in- 
 tended to prevent some of the evils which are so likely to flow from the 
 traffic in spirituous liquors. If revenue alone had been the object, li- 
 censes would ha,ve been allowed indiscriminately to all. But the stat- 
 ute forbids a license to any one, whether tavern-keeper or grocer, who 
 is not of good moral character; and he must moreover give bond, 
 with sureties, that his house or grocery shall not become disorderly. 
 Sections 6, 7, I3. These regulations were evidently intended to pro- 
 tect the public, in some degree, against the consequences which might be 
 expected to follow from allowing all persons, at their pleasure, to deal 
 in strong liquors. And although the statute only inflicts a penalty for 
 selling withut a license the contract is illegal, and no action will lie to 
 enforce it. The justice was wrong ; and his judgment has been prop- 
 erly reversed by the common pleas. 
 
 Judgment affirmed.''^ 
 
 '2 In the following cases the requirement of a license was held to be for 
 the protection of the public and not for puiTposes of revenue only, and that 
 contracts made without fulfilling the requirement were illegal and void: 
 In re Reidy's Estate, 164 MiCh. 167, 129 N. W. 196 (1910), unlicensed clerk 
 in drug store cannot maintain suit for wages : Bowdoin v. Alabama Chemical 
 Co., 201 Ala. 582, 79 South. 4 (1918), license to sell fertilizers; Zimmerman 
 V. Brown, 30 Idaho, 640, 166 Pac. 924 (1917), sale of unlicensed stallion; 
 Gardner v. Tatum, 81' Cal. 370, 22 Pac. 880 f 18S9) , physician ; Tedrick v. Hln- 
 er, 61 111. 189 (1871 j, lawyer; Hittson v. Browne, 3 Colo. 304 (1877), lawyer 
 cf. Harland v. Lilienthal, 53 N. Y. 438 [1873], and Brooks v. Volunteer Har- 
 bor No. 4 American Ass'n of Masters, Mates & Pilots, 233 Mass. 168, 123 N. 
 E. 511, 4 A. L. R. 1086, and note .(1919) ; Buckley v. Humason, 50 Minn. 195, 52 
 N. W. 385, 16 L. R. A. 42, 36 Am. St. Rep. 637 (1893), broker; Richardson v. 
 Brix, .94 Iowa, 626, 63 N. W. 325 (1895), broker; Goldsmith v. Manufac- 
 turers' Liability Ins. Co. of New Jersey, 132 Md. 283, 103 Atl. 627 (1918), in- 
 surance broker; Wells v. People ex rel. Daniels, 71 111. 532 (1874), public 
 school teacher; Bisbee, v. McAllen, 39 Minn. 143, 39 N. W. 299 (1888), 
 goods sold without using weights and measures inspected and approved as 
 required; Cope v. Rowlands, 2 M. & W. 149 (1836), where Baron Parke said: 
 '"i'he question for us now to determine is whether the enactment of the statute 
 is ineant merely to secure a revenue to the city, and for that purpose to ren- 
 der the person acting as a broker liable to a penalty; if he does not pay it,' or 
 whether one of its objects be the protection of the public, ancj the prevention 
 of improper persons acting as brokers? On the former supposition, the con- 
 tract with a broker for his brokerage is not prohibited by the statute; on 
 the latter it is." 
 
 In Hunter v. Big Four Auto Co., 162 Ky. 778, 173 S. W. 120, L. R. A. 1915D, 
 987 (1915), a statute, prohibited carrying on business under an assumed name 
 without first recording a. statement of the facts ; this was held to make 
 void a contract for the sale of goods by one not complying with the statute. 
 Contra: Saga! v. Fylar, 89 Conn. 293, 93 Atl. 1027, L. R. A. 1915E. 747 
 (1915). 
 
Sec. 9) CONDUCTING BUSINESS WITHOUT A LICENSE 1359 
 
 WOOD V. KREPPS et al. 
 (Supreme Court of California, 1914. 168 Gal. 3^, 143 Pac. 691, L. R A 
 
 1915B, 851.) 
 
 Action by Luther B. Wood against J. E. Krepps and another. From 
 a judgment for plaintiff, defendants appeal. Affirmed. 
 
 LoRiGAN, J. This action was brought to foreclose a chattel mort- 
 gage given as security for the payment of a promissory note for $1,000 
 principal, with interest at 4 per cent, per month, executed by defend- 
 ants in favor of the plaintiff. The note and mortgage were executed 
 March 7, 1910, and the mortgage was recorded the day following its 
 execution. 
 
 The answer of the defendants set up that at the time of the execu- 
 tion of the note and mortgage the plaintiff was engaged in the city of 
 Los Angeles in carrying on the business of pawnbroking and the busi- 
 ness of loaning money for himself and others on personal security and < 
 on personal property other than carrying on the business of bank- 
 ing, and, as special defenses against the right of plaintiff to recover, 
 alleged : First, that plaintiff did not at the time of the execution of the 
 note and mortgage — March 7, 1910 — nor until October, 1911, give to 
 the defendants the memoranda or notice provided for by section 5 of 
 an act of the Legislature defining personal property brokers and regu- 
 lating their charges and business (Stats. 1909, p. 969) ; and, second, 
 that plaintiff had not, at the time of the execution of said note and 
 moii;gage, procured a license, as required by an ordinance of the city 
 of Los Angeles to authorize him to carry on the business of paWn- 
 broking or the business of loaning money for himself arid others up- 
 on personal security and upon personal property in which he was en- 
 gagfed. Plaintiff moved to strike out from the answer these special 
 defenses referred to, on the ground that they were immaterial and re- 
 dundant. The. court granted the motion and entered a decree of fore- 
 closure in favor of the plaintiff. Defendants appeal from this de- 
 cree, insisting that the court erred in striking out the'defehses set up 
 in their answer. This is the only point made. 
 
 The theory of the defendants in alleging that plaintiff had failed to 
 .give them the memorandum or notice of the contents of the note and 
 mortgage and other matters provided for by section 5 of the said act 
 of 1909, at the time the note and mortgage were executed, is that such 
 failure precluded any recovery by plaintiff. But this theory is erro- 
 neous. While the section relied on provides that when a loan such as 
 here is made a memorandum or notice of the contents of the note and 
 mortgage and other matters shall be given the mortgagors, it is not 
 made by the statute essential to the validity, of the transaction that 
 this shall be done. It is a statutory duty, imposed upon the personal 
 property broker, to be performed by him when the loan is made, but 
 after the instrument taken as security is executed. It is a matter which 
 does not at all enter into the contract between the parties,- but is col- 
 lateral to it. The statute itself provides that as a penalty for failure 
 
1360 ILLEGAL CONTRACTS (Ch. 9 
 
 to give the memorandum or notice the broker shall be subjected to a 
 fine not exceeding the specified amount. This is the only penalty 
 which the statute imposes. No further penalty is declared, and the 
 contract itself is not in any manner affected by the failure to comply 
 with this provision of the section. 
 
 Now as to the ordinance pleaded in the answer. This ordinance, 
 alleged to have been in force on and prior to the making of the note 
 and mortgage, was a general Hcense ordinance of the city of Lo§ An- 
 geles, which declared that it shall be unlawful for any person to com- 
 mence or carry on any trade, profession, or occupation set forth in 
 the ordinance without having first procured a license to do so ; de- 
 clared that the amount of such license imposed on any occupation 
 mentioned in the ordinance shall be deemed a debt to the city, to be 
 collected by civil action; provided, that "every person, firm or cor- 
 poration engaged in doing or carrying on the business of pawnbroking 
 or the business of loaning money for himself or any other person up- 
 on personal security, upon evidences of indebtedness, assignments of 
 salary, salary warrants or demands, or any personal property other 
 than those carrying on the business of banking" shall pay a license 
 of $50 per annum; and further provided that a violation of any of 
 the provisions of the ordinance shall constitute a misdemeanor pun- 
 ishable by fine or imprisonment, or both. 
 
 The theory of the appellants upon this branch of the defense plead- 
 ed is that, the note and mortgage having been executed at a time when 
 respondent was engaged in the business of a personal property broker 
 as distinguished from that of a pawnbroker without having procured 
 the license required by the ordinance to do so, the note and mort- 
 gage given to him were executed in violation of the law, and are void. 
 
 It is to be observed in considering this claim of appellants that while 
 they allege in their special defenses that respondent was engaged in 
 the business of pawnbroking and also in the business of loaning money 
 upon personal property as a personal property broker (and the section 
 of the ordinance just quoted fixing a license tax mentions them both), 
 still they are there treated as separate and distinct businesses, and the 
 transaction here involved pertains solely to the business of loaning 
 money on personal property — the personal property brokerage busi- 
 ness. In their answer, though not heretofore referred to, appellants 
 set up, in connection with their pleading based on the ordinance, vari- 
 ous regulations prescribed by it for the conduct of the business of 
 pawnbroking and the failure of the respondent to conform to them, 
 as well as a failure to have procured a license for carrying on the 
 business of a personal property broker, and cite cases — notably that 
 of I^evinson v. Boas, 150 Cal. 185, 88 Pac. 825, 12 L. R. A. (N. S.) 
 575, 11 Ann. Cas. 661— where it is held that the business of pawn- 
 broking is subject to police regulations for the benefit of the public; 
 that it may be suppressed or licensed as a municipality sees fit ; that 
 when licensed it may he required to be conducted under rules, regu- 
 lations, and restrictions; and that if conducted without a license or 
 
Sec. 9) CONDUCTING BUSINESS WITHOUT A LICENSE 1361 
 
 wiliiout conforming to the regulations imposed, contracts of pledge 
 made in the transaction of such business are rendered void. But here 
 we are not concerned with the business of pawnbroking or the valid- 
 ity of contracts made in disregard of regulations imposed by ordinance 
 for the valid conduct of such business because the contract involved 
 here has no relation to that business. It is one alleged to have been 
 entered into with plaintiff while conducting the business of a pefson- 
 a.1 property broker — loaning money on chattel mortgage— without a 
 license, a legitimate business which neither called fpr nor was sub- 
 jected to any regulation under the ordinance. 
 
 But considered even with respect to such latter business appellants 
 insist that as the note and mortgage were executed to plaintiff while 
 he was engaged in such business and as part of it in violation of the 
 ordinance which forbade, under penalty, that particular business from 
 being carried on without a license, the note and mortgage are there- 
 fore void. The position of counsel for appellants is that where a 
 penalty is fixed in an ordinance for doing! business without a license, 
 it amounts to a prohibition against doing such business, and a contract 
 executed in violation of such prohibition cannot be enforced. There 
 are some authorities which sustain this position to the extreme extent 
 which appellants claim, but it is not of general application. Whether 
 the imposition of a penalty under a statute or ordinance is intended 
 to be prohibitory or not is to be determined from a consideration of 
 its nature and terms, and in determining this, certain rules have been 
 established which are generally recognized. The general doctrine now 
 well settled by the authorities is that when the object of the statute 
 or ordinance in requiring a license for the privilege of carrying on a 
 certain business is to prevent improper persons from engaging in that 
 particular business, or is for the purpose of regulating it for the pro- 
 tection of the public or in the interest of public morals, health, or po- 
 lice, the imposition of the penalty amounts to a prohibition against do- 
 ing the business without a license, and a contract made by an un- 
 licensed person in violation of the statute or ordinance is void. This 
 was the rule applied in Levinson v. Boas to the pawnbroking con- 
 tract there involved, and that case fairly illustrates its application. On 
 the other hand, it is equally well settled, though it must be admitted 
 that there are some few authorities to the contrary, that when the 
 object of the statute or ordinance in imposing a license to conduct a 
 harmless and legitimate business is solely for the purpose of yielding 
 a public revenue, and not for the purpose of protection, contracts made 
 in the course of such business are valid, notwithstanding a penalty is 
 imposed for a failure to obtain a license to conduct it. This was the 
 purpose— municipal revenue solely— which the municipality had m 
 view by i-equiring a license for carrying on the business of loaning 
 money on personal property or the personal property brokerage busi- 
 ness in which plaintiff was engaged, and out of which the note and 
 
 OORBIKf CONT 86 
 
1362 ILLEGAL OONTEAOTS (Ch. 9 
 
 mortgage here involved arose. There is no law in this state making 
 the business of loaning money on personal property illegal. It is a 
 legitimate branch of commercial business which the state has only 
 regulated to the extent of fixing the maximum rate of interest. The 
 business itself, however, is not affected. It is neither malum in se 
 nor malum prohibitum. The ordinance does not pretend to prescribe 
 or prohibit the business. Any one may carry it on, the only condition 
 attached to doing so being that the person engaged in it must obtain a 
 license. The only penalty imposed is that if he does not do so, he will 
 not only be subject to a civil action at the instance of the city, but 
 likewise to a penalty in a criminal proceeding for doing business with- 
 out having obtained it. The carrying on of the business itself is not 
 prohibited; it is only the carrying on of it without a license. The 
 prohibition runs against the person engaged in it without a license, not 
 against the business itself. The ordinance does not declare that a 
 contract, made by any one in the conduct of the various businesses for 
 which licenses are provided to be procured under the ordinances, shall, 
 if' a license is not obtained, be invalid; nor is there any provision 
 therein indicating in the slightest that this failure was intended to af- 
 fect in any degree the right of contract. The primary purpose of the 
 ordinance is to secure revenue by the imposition of license taxes on 
 the several occupations mentioned in it, and not to, suppress or to pro- 
 hibit their being carried on, and while a penalty is, as usual, imposed 
 for failure to obtain the license, this, in the absence of any-declara- 
 tion of a further penalty, is the only one to which the party conduct- 
 ing the business without a license was intended to be subjected. The 
 question of license is essentially one between the city and the person 
 engaging in business within the limits of the municipality^ It is not a 
 matter in which third parties are interested. Whatever penalties are 
 imposed upon business delinquencies are in aid of enforcing the rights 
 of the city, and are not intended to operate further so as to defeat 
 contracts between those engaged in business without a license and 
 third parties, or to afford the. latter an opportunity of repudiating their 
 indebtedness or acquiring property without paying for it.''* * * * 
 Affirmed.'* 
 
 , ''^ The court here cited, with quotation, Vermont Loan & Trust Co. v, 
 Hof&nan et al, 5 Idaho, 376, 49 Pac. 314, 37 L. R. A. 509, 95 Am. St. Bep. 
 186 (1897) ; Walker v. Baldwin & Frick et al., 103 Md. 352, 63 Atl. 362 
 (1906) ; Buckman v. Bergholz, 87 N. J. Law, 347 (1875) ; Toocker v. 
 Duckworth, 107 Mo. App. 231, 80 S. W. 963 (1904) ; Sunflower Lumber C5o. 
 V. Turner Supply Co., 158 Ala. 191, 48 South. 510, 132 Am. St. Bep. 20 
 (1909) ; Mandelbaum v. Uregovich, 17 Nev. 87, 28 Pac. 121, 45 Am. Bep. 433 
 (18^) ; Lamed v. Andrews, 106 Mass. 435, 8 Am. Bep. 346 (1871) ; Lindsey 
 V. Butherford, 56 Ky. (17 B. Mon.) 245 (1856^ ; Fairly v. Wappoo Mills, 
 44 S. 0. 227, 22 S. E. 108, 29 L. B. A. 215 (1894) ; Harris v. Bunnels, 53 U. 
 S. (12 How.) 79, 13 L. Ed. 901 (1851) ; Niemeyer et al. v. Wright, 75 Va. 
 239, 40 Am. Bep. 720 (1881) ; Aiken v. Blalsdell, 41 Vt. 655 (1869) ; Elliott 
 on Contrac1;s, vol. 1, § 267; Sutherland, Stat Const. § 336. 
 
 7* Statutes affixing peiial ties were similarly construed in Pangborn Y. 
 AVestlake, 36 Iowa, 546 (1873), penalty for selling city lots, .'s^ithout recording 
 
t>ec. 10) CONTRACTS FOE ILLEGAL PURPOSE 
 
 1363 
 
 SECTION lO.-CONTRACTS IN AID OR WITH KNOWL- 
 EDGE OF ILLEGAL PURPOSE 
 
 WAYMELL V. REED et al. 
 
 (In the King's Bench, 1794. 5 Term R. 599.) 
 
 In assumpsit for goods sold and delivered, the defence was, that the 
 contract was a smuggling transaction. It appeared in evidence that 
 the defendants had applied to the plaintiff, who was a foreigner living 
 at Lisle, for a quantity of lace, which he knew was intended to be 
 smuggled into England; and for that .purpose it was packed by the 
 plaintiff m a peculiar manner, by the direction of the defendants, for 
 the more easy conveyance of it without a discovery. A verdict' was 
 taken for the plaintiff, subject to be set aside, and a nonsuit entered, 
 if this Court should be of opinion that the plaintiff was not entitled to 
 recover under these circumstances. A rtile having been obtained for 
 that purpose, 
 Erskine and Best shewed cause. 
 
 Bower and Garrow, contra, were stopiped by the Court. 
 Lord Kbnyon, C. J." It is not necessary to enquire now, whether 
 or not it be immoral for a native of one country to enter into a con- 
 tract with the subject of another, to assist the latter in defrauding the 
 revenue laws of his country? It is Sufficient, in order to dispose of 
 this case, to advert to the distinction laid down by Lord Mansfield in 
 Holman v. Johnson, Cowp. 344, to which I entirely subscribe, that 
 where the contract and delivery of goods are complete abroad, and the 
 seller does no act to assist the smuggling them into this country, such 
 contract is valid, and may be recovered upon here. But here the plain- 
 tiff was concerned in giving assistance to the defendants to smuggle 
 the goods, by packing them in the manner most suitable for, and with 
 intent to aid, that purpose. He cannot, therefore, resort to the laws 
 of this country to assist him in carrying his contract into execution. 
 What was said by Lord Mansfield, at the end of Holman v. Johnson, 
 comes up to the present case. 
 Rule absolute.''* 
 
 a plan of the city addition; Harris v. Runnels, 12 How. 79, 13 L. Ed. 901 
 (1851) ; Wheeler v. Hawkins, 116 Iiid. 515, 520, 19 N. E. 470 (1889) ; Union 
 Nat. Bank v. Matthews, 98 U. S. 621, 25 L. Ed. 188 (1878); Nielneyer t. 
 Wright, 75 Va. 239, 40 Am. Rep. 720 (1881) ; Ritchie v. Boynton, 114. Mass. 
 431 (1874) ; Wood v. Erie Ry. Co., 72 N. Y. 196, 28 Am. Rep. 125 (1878) ; 
 Gay V. Seibold, 97 N. Y. 472, 49 Am. Rep. 533 (1884) ; Smith v. Mawhood, 
 14 M. & W. 452 (1845), license to sell tobacco. 
 
 75 BuUer and Grose, J J., concurred. 
 
 ''« A seller can maintain action for the price, even though he had knowl- 
 edge that the buyer intended to smuggle the goods into the buyer's country. 
 ■'There is nothing illegal in merely knowing that the goods he sells are to be 
 
1364: ILLEGAL CONTUAOTS (Ch. 9 
 
 PAUL JONES & CO. V. WILKINS. 
 
 (Supreme Court of Tennessee, 1916. 135 Tenn. 146, 185 S. W. 1074, Ann. 
 
 Cas. 1918B, 977.) 
 
 Suit by Paul Jones & Co. against T. B. Wilkins. To review judg- 
 ment for defendant, plaintiff petitions for certiorari. Writ denied. 
 
 Williams, J. This suit was commenced by Paul Jones & Co., a 
 wholesale liquor concern of Louisville, Ky., to recover the sale price of 
 35 cases of whisky sold to Wilkins and shipped to Memphis. The de- 
 fense was based on the ground that the liquor was sold to Wilkins to 
 be by him retailed in Shelby county, in violation of the prohibition 
 laws of this state in force in that city. The trial judge and the Court 
 of Civil Appeals havp concurred in a denial of a remedy to plaintiff 
 in the suit; and the cause is before us for review on a petition for 
 certiorari. 
 
 The fundamental principles that must govern the controversy are 
 those announced in the case of Bank v. Burke, 135 Tenn. 19, 185 S. 
 W. 704, Ann. Cas. 1918C, 439, at this term of court. That case involv- 
 ed the legality of a contract of lease, but the opinion also discussed 
 contracts of sale. 
 
 The general rule is that in case of the sale of intoxicating liquors 
 mere knowledge on the part of the seller that the purchaser intends il- 
 legally to resell such liquors will not render the contract void so as to 
 bar the seller's action for the purchase price. Tracy v. Talmage,. 14 
 N. Y. 173, 67 Am. Dec. 132 ; Anheuser-Busch Brewing Asso. v. Ma- 
 son, 44 Minn. 318, 46 N. W. 558, 9 L. R. A. 506, 20 Am. St. Rep. 580; 
 Washington Liquors Co. v. Shaw, 38 Wash. 398, 80 Pac. 536, 3 Ann. 
 Cas. 153; Frankel v. Hillier, 16 N. D. 387, 113 N. W. 1067, 15 Ann. 
 Cas. 265 ; 9 Cyc. 571. 
 
 However, if the seller participates or contributes to the intention of 
 the purchaser to sell in violation of law, or does any act, however 
 sUght, to facilitate or in furtherance of the design to transgress, or has 
 an interest therein, the right to recover for the price is lost. The par- 
 ticipation in the illegal purpose or act must be in some manner other 
 than the mere act of making the sale. Authorities, supra. 
 
 We are of opinion that the facts in this case show such a participa- 
 tion on the pail of the plaintiff vendor as to bar him of any remedy. 
 The plaintiff knew through its local solicitor in Memphis that Wilkins 
 was running a "wide-open" retail liquor saloon; the solicitor had 
 bought drinks for himself and others over the bar. The shipment rep- 
 resented by the account in suit was not made to Wilkins as consignee, 
 hilt to the Lewis Transfer Company for delivery — -so agreed in order 
 that the' public would not know to whom it was to be delivered. The 
 
 disposed of in contravention of the fiscal laws of another country. • * * 
 The distinction is, where he takes an actual part in the illegal adventure, as 
 in packing the goods in prohibited parcels.'' Pellecat v. Angell, 2' C, M. 
 & R. 311 (1835), following Holman v. Johnson, Cowp. 344 (1775). 
 
Sec. 10) CONTRACTS FOB ILLEGAL PURPOSE 1365 
 
 cases were not marked with the name of T. B. Wilkins, but with the 
 initials, "T. B. W." 
 
 The manager of the vendor company testifies that the shipment to 
 the transfer company as consignee was for the purpose of insuring 
 delivery to Wilkins. We fail to see how that end could have been 
 more safely attained by tlie marking of the outside of the cases with 
 mere initials, rather than with the name arid street address of the 
 purchaser, even though it was desirable thus to use the transfer com- 
 pany. 
 
 Where it appeared that the plaintiff, a wholesale liquor dealer, sup- 
 plied a retailer in another state with intoxicating liquors, and aided the 
 latter by shipping to a fictitious consignee part of the liquors, and by 
 packing other portions so as to conceal their true character, it was 
 held that his account could not be recovered. Kohn v. Melcher (C. C.) 
 43 Fed. 641, 10 L. R. A. 439; Feineman v. Sachs, 33 Kan. 621, 7 Pac. 
 222, 52 Am. Rep. 547; Corbin v. Houlehan, 100 Me. 246, 61 Atl. 131, 
 70 L. R. A. 568. 
 
 In Gaylord v. Soragen, 32 Vt. 110, 76 Am. Dec. 154, it was held 
 that an action by the seller could not be maintained when, at the de- 
 fendant's request, the plaintiff marked the packages in a peculiar way, 
 omitting the defendant's name so as to enable the defendant with 
 greater facility to save them from seizure. 
 
 Particular pertinency is given to these authorities by the fact that 
 we liave in this state a statute (Act Extra Session 1913, c. 1) that re- 
 quires common carriers to cause all consignees of liquors to sign, be- 
 fore delivery of goods, an affidavit setting out his name, address, the 
 fact of consignment to affiant, the use to be made of the liquors, etc. 
 It is manifest that the manipulation resorted to by the plaintiff was to 
 circumvent the object sought to be attained by the Legislature m the 
 
 passage of this act. ,,,■.<• j tt 
 
 A correct result has been reached m this case. Writ demed. 
 
 STANDARD FURNITURE CO v. VAN ALSTINE. 
 
 (Supreme Court of WasUngton 1900. 22 Wash J, 62 Pac. 145, 51 L. K. 
 A. 889, 79 Am. St. Kep. 960.) 
 
 Action by the Standard Furniture Company against Con Van Alstine. 
 Prom a judgment for defendant, plaintiff appeals. Affirmed. 
 
 FULLERTON, J. This is an action brought by the appellant a domes- 
 tic corporation, for the recovery of certain furniture and house-fur- 
 nishing goods. The complaint was, in form, that commonly used in 
 this state for the recovery of personal property in specie. The re- 
 spondent, who was defendant below, after denymg the allegations of 
 
 T7in accord: Johnstown Land Co v. Bralnerd brewing Co 142 Minn. 
 291, 172 N. W. 211 (1919) ; Hull v. Ruggles, 56 N. Y. 424 (1874). 
 
1366 ILLEGAL CONTRACTS (Ch. 9 
 
 ownership and right of possession of the property in appellant con- 
 tained in the complaint, pleaded affirmatively that the' appellant claim- 
 ed title to the property by virtue of a certain agreement in writing by 
 which two certain women purchased^ the property, and agreed to 
 pay appellant theref or^ but without further description as to the char- 
 acter of the agireerrient. He then pleaded the recovery of a judgment 
 by himself against the purchasers named in the agreement, the issuance 
 of an execution thereon, the seizure and sale of the property under 
 the writ of execution, and his purchase of the property and its delivery 
 to him at the execution sale. He pleaded further that the vendees 
 were, at the time of the execution of the written agreement and the 
 delivery of the property by the appellant to them, the keepers of a 
 house of ill fame in the city of Seattle; that the appellant had knowl- 
 edge at the time the agreement was entered into, and at the time the 
 goods were delivered, that the vendees .were the keepers of a house of 
 ill fame, "and that the said goods so delivered, and said written agree- 
 ment aforesaid, were to aid and enable the said" vendees "to carry 
 on and conduct: a house of prostitution; * * * and that any sum 
 remaining unpaid on account of said goods, if any! did remain, was to 
 be paid by said" vendees to the appellant "out of the earnings of said 
 house of prostitution." : 
 
 The appellant, in reply, admitted the judgment, levy, and sale, and 
 that it claimed title by virtue of a conditional contract of sale, but 
 denied the other allegations of the affirmative answer. It then plead- 
 ed affirmatively the conditions of the contract under which the sale 
 of the property was made, showing it to be a conditional sale, with 
 "title; ownership, and possession of the property" reserved in itself 
 until the purchase price should be paid, and with the right, also, to 
 "take possession of the aforesaid personal property 'whenever it may 
 deem itself insecure, even before maturity" of the deferred payments ; 
 that the purchase price was to be paid in monthly installments of $150 
 each, and that title should pass to the vendees when the last installment 
 should be paid. It alleged a breach on the part of the vendees of the 
 conditions of th^ contract, and that the, respondent had refused to 
 perform the same, and its election to declare the contract forfeited. 
 It then allegedj by way of estoppel, that the notice given of the execu- 
 tion sale at which the' respondent purchased expressly recited that the 
 property was to be sold subject to the contract of sale between the 
 appellant and its vendees, that the officer conducting the sale orally 
 proclaimed that fact at the time he offered the property for sale, and 
 that the sale was actually so made. At the trial, after the appellant had 
 introduced its evidence and rested its case, the respondent called the 
 president of the appellant, and proceeded to examine him toucliing the 
 affirmative matter alleged in his answer not admitted by the reply. 
 Before the examination of the witness was concluded, the court an- 
 nounced that, the evidence was sufficient to warrant the court in. hold- 
 ing that the contract was void as against public policy. He thereupon 
 
Sec. 10) CONTRACTS FQB ILLEGAL PURPOSE 1367 
 
 refused to permit the appellant to offer proofs on the matter alleged 
 in the reply as an estoppel, took the case from the jury, and entered 
 judgment in favor of the respondent. 
 
 It is urged on behalf of the appellant that the evidence before the 
 trial court upon which it based its judgment showed, at most, nothing 
 more than that the appellant, at the time it entered into the contract 
 of conditional sale and delivered the property to the vendees named 
 therein, had knowledge that the vendees intended to put the property 
 to an unlawful use; and that this fact is not sufficient to justify the 
 trial court in its holding that the contract was void as againsf public 
 policy. It is true that it is held in many well-considered cases, and it 
 is perhaps the weight of authority, that mere knowledge on the part 
 of a vendor of goods that the vendee designs to and will put them 
 to an immoral or illegal use is not of itself sufficient to bar an action 
 brought to recover the purchase price of the goods sold. But in all 
 of the cases announcing this rule which have been brought to our 
 attention the transaction was one in which the owner of the goods at 
 the time of their delivery to the vendee parted with his title and 
 right of possession, so that thereafter the relation between the 
 vendor and vendee was that of debtor and creditor merely, or that of 
 debtor and creditor with a mortgage over to secure the deferred pay- 
 ments of the purchase price. The sale and delivery of the property 
 were complete, and no element of participation or aid in the immoral 
 or illegal design of the vendee could be imputed to the vendor. 
 
 On the other hand, it is held by all of the cases — even those which an- 
 nounce the rule contended for by the appellant — that if the vendor has 
 knowledge of the immoral or illegal design of the vendee, and in any 
 way aids or participates in that design, or if the contract of sale is so 
 connected with the illegal or immoral purpose or transaction of the 
 vendee as to be inseparable from it, the vendor cannot recover. Tatum 
 V. Kelley, 25 Ark. 209, 94 Am. Dec. 717; Tracy v. Talmage, 14 
 N. Y. 162, 67 Am. Dec. 132 ; Hill v. Spear, 50 N. H. 253, 9 Am. Rep. 
 205; Gaylord v. Soragen, 32 Vt. 110, 76 Am. Dec. 154; Aiken v. 
 Blaisdell, 41 Vt. 665; Schankel v. Moffatt, 53 111. App. 382; Ralston 
 v.'Boady, 20 Ga. 449; Webster v. Hunger, 8 Gray (Mass.) 584; Adams 
 v. Coulliard, 102 Mass. 167'; Graves v. Johnson, 156 Mass. 211, 30 N. 
 E. 818, 15 L. R. A. 834, and note to this case in 32 Am. St. Rep. 4S0; 
 Beach,' Mod. Cont. § 457. And there are cases which hold that knowl- 
 edge on the part of the vendor that the purchaser intends to devote 
 the property purchased to an illegal use will bar a recovery of the 
 purchase price, even though he does no other act than deliver the 
 property to the vendee. It was so held by the supreme court of &e 
 United States in Hanauer v. Doane, 12 Wall. 342, 20 L. Ed. 439, 
 though the court seems to admit that there might be a distinction be- 
 tween the cases where the use to' which the property is to be devoted 
 is only malum prohibitum, or of inferior criminality, and the cases 
 where it is to be used in aid of the perpetration of a heinous crime, 
 
1368 ILLEGAL CONTRACTS (Ch. 9 
 
 such as treason, as was the fact in that case. See, also,, Tatum v. 
 Kelley, supra; Milner v. Patten, 49 Ala. 423; I^ewis v. Latham, 74 
 N. C. 283; Bickel v. Sheets, 24 Ind. 1 ; Steele v. Curie, 4 Dana (Ky.) 
 381. 
 
 Where the sale is absolute, though on credit, the yendee becomes 
 the owner of the property purchased, and has all the rights therein 
 that any owner has over his own property, and he may make such use 
 of it as to him seems fit, without let or hindrance from his vendor. 
 Under an ordinary contract of conditional sale, the law i$ different. 
 The v6ndee thereunder, the title being reserved in the vendor, is a 
 mere bailee of the property. If the use of the property be not pre- 
 scribed in the contract of sale, the purchaser must nevertheless use it 
 for a lawful and proper purpose, and in the way its nature contem- 
 plates it should be used, or else suffer a forfeiture of its contract. It 
 is clear that the relation between the parties to the contract in the 
 present case was something more than that of debtor and creditor 
 merely, and it would seem it was something more than an ordinary con- 
 tract of conditional sale. The appellant not only reserved "title, own- 
 ership, and possession of the property," but reserved the right to "take 
 possession of the aforesaid personal property whenever it may deem 
 itself insecure, even before the maturity" of the deferred payments. 
 This practically left the control of the use of the property with the 
 appellant, and, as the evidence shows that it had knowledge of the 
 immoral and illegal use to which the vendees intended to and did 
 put the property, it is hard to conceive why it did not aid and participate 
 in that immoral and illegal use. 
 
 The distinction between knowing that a buyer is intending to put 
 the property to some unlawful use, and participating in that unlawful 
 intent, is, to say the least, somewhat refined ; and where a vendor, for 
 the mere sake of gain, makes a contract, the effect of, which is to put 
 his own property in the hands of persons who will use it to cbnduct 
 a house of prostitution, knowing it will be so used, the courts ought not 
 to be astute to find nice distinctions which will enable him to avoid 
 the consequences of his acts. It must be borne in mind that at common 
 law it was an indictable offense to keep a house of ill fame, or to let a 
 house knowing it was to be used for the purpose of prostitution 
 (Whart. Cr. Law, § 1459) ; that in this state these acts are made mis- 
 demeanors by statute (Ballinger's Ann. Codes & St. §§ 7239, 7261); 
 and that "any contract auxiliary to the keeping of a bawdy house, or 
 otherwise encouraging prostitution, is void" (Bish. Cont. § 506; 
 Dougherty v. Seymour, 16 Colo. 289, 26 Pac. 823; Hunstock v. Pal- 
 mer, 4 Tex. Civ. App. 459, 23 S. W. 294; Chateau v. Singla, 114 
 Cal. 91, 45 Pac. 1015, 33 L. R. A. 750, 55 Am. St. Rep. 63; Beach, 
 Mod. Cont. § 1443). 
 
 We are aware that the appellant, though it admits that it had knowl- 
 edge at the time it entered into the contract that its vendges were pros- 
 titutes, and that the house where they lived, and where :the goods were 
 
Sec. 10) CONTJRACTS FOB ILLEGAL PPRPOSE 1369 
 
 delivered was in a section of the city known as the "Tenderloin Dis- 
 trict," contends that the evidence fails to show that it had knowledge 
 that the house was kept as a house of ill fame. A perusal of the entire 
 record, however, does not leave this question in doubt. Nor was 
 there such a substantial conflict in the evidence thereon as- to compel 
 the trial court to submit the question to the jury. 
 
 It is further contended that the trial court erred in refusing to per- 
 mit the appellant to offer proofs of the matter alleged in the reply by 
 way of estoppel, but in this we find no error. No principle of law is 
 better settled than that, a contract prohibited by law or morality is 
 void as against public policy. It is because of the public interest, and 
 not the desire to aid the defendant, that the courts refuse to enforce 
 such a contract, and hence the doctrine of estoppel has no application. 
 Greenh. Pub. Pol. rule 126, and illustrations there given ; Beach, Mod. 
 Cont. § 1499; Turnbull v. Farnsworth, 1 Wash. T. 444; Ah Boon v. 
 Smith, 25 Or. 89, 34 Pac. 1093. 
 
 The judgment is affirmed.'^' 
 
 78 In Pearce v. Brooks, L. R. 1 Ex. 213, 14 L. T. 288 (1866), the plaintiff 
 sold a brougham to the defendant, knowing that the defendant was a 
 prostitute, who expected to use the brougham in her illegal trade, and that 
 payment would be made out of her illegal gains. It was held that the 
 contract was illegal and void. 
 
 In the United States, a contract that is in itself lawful is not made unen- 
 forceable by the fact that the plaintiff knew that the defendant had an 
 ■unlawful purpose ulterior to the contract, if the plaintiff does not share the 
 purpose and aid its execution. Bryson v. Haley, 68 N. H. 337, 38 Atl. 1006 
 (1895) ; Tyler v. Cariisle, 79 Me. 210, 9 Atl. 356, 1 Am. St. Rep. 301 (1887) ; 
 Graves v. Johnson, 156 Mass. 211, 30 N. E. 818, 15 L. E. A. 834, 32 Am. St. 
 Hep. 446 (1892) ; s. c, 179 Mass. 53, 60 N. B. 383, 88 Am. St. Rep. 355 (1901) : 
 Tracy v. Talmage. 14 N. Y. 162, 67 Am. Dec. 132 (1856) ; Hill v. Spear, 50 N. 
 H. 253, 9 Am. Rep. 205 (1870). But see Hanauer v. Doane, 12 "Wall. 342, 20 
 li. Ed. 439 (1870), "heinous crime." 
 
 Directly contra to Pearce v. Brooks are : LooSe v. Larsen, , 40 Nev. 157, 
 161 Pac. 514, L. R. A. 1917B, 1166 (1916), sale of liquor to house of prostitu- 
 tion ; Anheuser-Busch Brewing Ass'n v. Mason, 44 Minn. 318, 46 N. W. 558, 
 9 L R. A. 506, 20 Am. St. Rep. 580 (1890), same ; Fineman v. Faulkner, 174 N. 
 C 13, 93 S. E. 384, L. R. A. 1918A, 337 (1917) , sale of Edison machine to prosti- 
 tute ; Luderbach Plumbing Co. v. Stein, 113 Miss. 475, 74 South. 327 (1917) , 
 installing electrical fixtures in house of prostitution. 
 
 A contract involving future iUicit cohabitation is void. Saxon v. Wood, 
 4 Ind. App. 242, 30 N. E. 797 (1892) ; Boigneres v. Boulon, 54 Cal. 14& 
 (1880) ; Brown v. Tuttle, 80 Me. 162, 13 Atl. 583 (1888) ; Ayerst v. Jenkins, 
 16 Bq. 275 (1872). 
 
 An agreement between a married man and a woman to marry as soon as 
 the former shall secure a divorce from his existing wife is illegal. Olson v. 
 «axton, 86 Or. 670, 169 Pac. 119 (1917) ; Wilson v. Oarnley, [1908] 1 K. B. 
 729- Noice v. Brown, 38 N. J. Law, 228, 20 Aln. Rep. 388 (1876). 
 
1370 ILLEGAL CONTRACTS ' (Ch. ft 
 
 ROYS V. JOHNSON et al.. 
 (Supremd Judicial Court of Massachusetts, 1856. 7 Gray, 162.) 
 
 Metcalf, J. It is. agreed by the parties that the plaintiff performed 
 for the defendants the services for which he now seeks to recover 
 payment and that they have not paid him. It is. for them, therefore, 
 to show that he is not entitled to recover. This, in our opinion, is not 
 shown by the statement of facts submitted to us. It appears, indeed, 
 from that statement, that the defendants, without a license, set up 
 theatrical exhibitions, in which they employed the plaintiff as an actor ; 
 and it follows, of course, that they thereby violated the law, and sub- 
 jected themselves to punishment. But it does not appear that the 
 plaintiff knew that they had no license. Unless he knew that fact, he 
 is in no legal fault ; and where a defendant is the only ■ person who 
 has violated the law, he cannot be allowed to take advantage of his 
 own wrong, to defeat the rights of a plaintiff who is innocent. 
 
 In the cases cited by the defendants' counsel, where defences were 
 sustained because the claims were void for illegality, the parties suing 
 knew, or were bound to know, that they or the parties sued were vio- 
 lating or undertaking to violate the law. And this distinguishes all. 
 those cases, as well in law as in common justice, from the case at bar ; 
 as was held in Bloxsome v. Williams, 3 Barn. & C. 232. In that case, 
 a suit was brought to recover damages for breach of a \yarranty of a 
 horse sold to the plaintiff on Sunday. The defence was, that the con- 
 tract was void within St. 29 Ca,r. II, vsrhich prohibits worldly labor, 
 business or work, in the exercise of one's ordinary calling. It appear- 
 ed that the defendant's ordinary calling was that of a dealer in horses, 
 and therefore, that he had violated the statute by selling and warrant- 
 ing the horse ; but that dealing in horses was not the plaintiff's ordi- 
 nary calling, and therefore, that he had not violated the statute by 
 purchasing the horse and taking a warranty. But, as the case states, 
 there was no evidence that the plaintiff knew that the defendant was 
 by trade a horsedealer at the time the bargain was entered into. The 
 court held that the defendant was answerable for the breach of his 
 contract. Bayley, J., said. "The defendant was the persdn offending, 
 within the meaning of the statute, by exercising his ordinary calling 
 on the Sunday. He might be thereby deprived of any right to sue 
 upon a contract so illegally made ; and upon the same principle any 
 other person knowingly aiding him in a breach of the law, by be- 
 coming a party to such a contract, with the knowledge that it was il- 
 legal, could not sue upon it. But in this case, the fact that the de- 
 fendant was a dealer in horses was not known to the plaintiff. He,- 
 therefore, has not knowingly concurred in aiding the defendant to 
 offend the law ; and that being so, it is not competent to the defend- 
 ant to set up his own breach of the law as an answer to this action." 
 See report of the same case in 5 Dowl. & R. 82, and a recognition of 
 
Sec. 10) CONTRACTS FOR ILLEGAL PURPOSE 1371 
 
 the doctrine of that case in Fennell v. Ridler, 8 Dowl. & R. 207, 208, 
 and 5 Barn. & C. 409, and also in Begbie v. Levy, 1 Tyrw 131 and 1 
 Cromp. & J. 183. 
 
 It is to be noticed that in the case of Bloxsome v. Williams, it was 
 said that it was not known to the plaintifif that the defendant was a 
 dealer in horses, because there was no evidence that he knew it. In 
 the present case, we treat the plaintifif as not knowing that the de- 
 fendant had no license, because the statement of facts does not show 
 that he knew it. 
 
 It is ignorance of a fact, and not of the law, that saves the plaintiff's 
 case. He undoubtedly knew, or was bound to know, that unlicensed 
 theatrical exhibitions were unlawful ; but he was not bound to know 
 that the defendants had no license and were doing unlawful acts. 
 
 Judgment for the plaintifif.^^ 
 
 '8 In accord : Rosenbaum v. United States Credit System Co., 65 N. J. 
 Law, 255, 48 Atl. 237, 53 L. R. A. 449 (1900) ; Congress & B. Spring Co. v. 
 Knowlton, 103 U. S. 49, 26 L. Ed. 347 (1880) ; Emery v. Kempton, 2 Gray 
 (Mass.) 257 (1854) ; Kelley v. Riley, 106 Mass. 339, 8 Am. Rep. 336 (1871) ; 
 Chamberlain v. Beller, 18 N. Y. 115 (1858) ; Burkholder v. Beetem's Adm'r, 
 65 Pa. 496 (1870). So where one party to a sale for future delivery in- 
 tends it as a gambling transaction, but the other party does not, the latter 
 can enforce the contract. Pisley v. Boynton, 79 111. 351 (1875) ; Flowers 
 V. Bush & Witherspoon Co., 254 Fed. 519, 166 C. O. A. 77 (1918). Also 
 where a married man contracts to marry a woman who does not know that 
 he is married, she can maintain suit for breach of promise. Millward v. 
 LIttlewood, 5 Ex. 775 (1850). 
 
 The innocent party has rights under the contract ; but he is also privileged 
 not to perform, and may repwdiate on learning of the illegal action or pur- 
 pose of the other. Church v. Proctor, 66 Fed. 240, 13 C. C. A. 426 (1895) ; 
 Cowan V. Milbourn, L. R. 2 Ex. 230 (1867). 
 
 The Statute may Mark the Orimmal. — If the statute is Intended for. the 
 protection of one class of persons against another, the courts frequently 
 enforce a contract in favor of the former and against the latter, or else 
 create a quasi contractual duty of reimbursement in order to carry out the 
 real purpose of the statute. See Bowditch v. New England Mutual Life 
 Ins. Co., 141 Mass. 292, 4 N. E. 798, 55 Am. St. Rep. 474 (1886) ; Savings 
 Bank of San Diego County v. Burns, 104 Cal. 473, 38 Pac. 102 (1894) ; Tracy 
 V Talmage, 14 N. T. 162, 67 Am. Dec. 132 (1856); Scotten v.. State ex 
 rel. Simonton, 51 Ind. 52 (1875) ; Gray v. Roberts, 2 A. K. Marsh (Ky.) 208, 
 12 Am Dec. 383 (1820), suit against a lottery keeper; White v. President, 
 etc., of Franklin Bank, 22 Pick. (Mass.) 181 (1839) ; Smart v. White, 73 Me. 
 332, 40 Am. Rep. 356 (1882) ; McDiiffee v. Hayden-Coeur D'Alene Irr. Co., 
 25 Idaho, 370, 138 Pac. 503 (1913). 
 
 Ignorance of the law is no excuse ; but if a contract can be performed in 
 a lawful manner it will be enforced, in spite of the fact that the parties 
 expected to perform it in an alternative manner, which, unknown to them, 
 was Illegal. Waugh v. Morris, L. R. 8 Q. B. 202 (1873) ; Favor v. Philbrick. 
 7 N. H. 326 (1834) ; Hogston v. Bell, 185 Ind. 536, 112 N. E. 883 (1916). 
 
1372 ILLEGAL CONTRACTS (Ch. 9 
 
 SECTION 11.— CONTRACTS ILLEGAI. IN PART 
 
 SULLIVAN V. HORGAN. 
 
 (Supreme Court of Rhode Island, 1890. 17 R. I. 109, 20 Atl. 232, 9 L. R. 
 
 A. 110.) 
 
 Matteson, J. This is an action of assumpsit to recover moneys 
 claimed to be due to the plaintiff from the defendant under a contract 
 of hiring. It appears from the evidence reported that the plaintiff 
 was employed by the defendant in his business of a dealer in groceries 
 and liquors, as bar-tender and clerk, from November 27, 1886, until 
 April 19, 1888, and was to receive as wages $18 per month until May 
 1, 1887, and $25 per month thereafter. At the trial the defendant set 
 up as a defense the illegality of the contract, the sale of liquors being 
 prohibited by law when the contract of hiring was made, and during 
 the period of the plaintiff's employment. The jury returned a verdict 
 for the plaintiff for $187.84. The defendant moves for a new trial, 
 on the ground that the verdict is against the law and the evidence. 
 
 The principle that if a contract or promise' be founded on a legal 
 and an illegal consideration, and the illegal consideration cannot be 
 separated from the legal, and rejected, the illegality of part vitiates- 
 the whole, so that no action can be maintained, upon it as a contract, 
 is conceded; but it is suggested that, inasmuch as the contract is 
 illegal and ■ void, and is therefore, as it *is contended, a nullity, the 
 plaintiff is entitled to recover for that portion of his services per- 
 formed as clerk in the grocery part of the business, upon a quantum 
 meruit, what such services were reasonably worth, and therefore that 
 the verdict may be supported. We do not, however, agree with the 
 suggestion. Although a contract thus infected with illegality is re- 
 garded in law as a nullity, in so far that the law will not lend its aid 
 to enforce it, it is nevertheless not treated as if it had no existence in 
 fact. The illegality extends to every part .of the transaction, and it 
 cannot, therefore, be made the foundation of an assumpsit. Both 
 parties are in pari delicto, and the law will, for that reason, not aid 
 either party to enforce the contract, but leaves them where it finds 
 them. It may sometimes happen, in consequence, that a defendant 
 may gain a pecuniary benefit by reason of his wrong-doing, or of that 
 in which he has equally participated ; but it is not for the sake of the 
 defendant that his objection to his own illegal contract is sustained. 
 In Holman v. Johnson, Cowp. 341, 343, Lord. Mansfield remarks: 
 "The objection that a contract is immoral or illegal as between plain- 
 tiff and defendant sounds at all times very ill in the mouth of the de- 
 fendant. It is not for his sake, however, that the objection is ever 
 allowed, but it is founded in general principles of policy, which the de- 
 fendant has the advantage of, contrary to the real justice, as between 
 him and the plaintiff, by accident, if I may so say. The principle of 
 
^^'^^ 11) CONTRACTS ILLEGAL IN PART 1373 
 
 public policy is this : ex dolo malo non oritur actio. No court will 
 lend its aid to a man who founds his cause of action upon an immoral 
 or an illegal act. If, from' the plaintiff's own stating or otherwise, the 
 cause of action appears to arise ex turpi causa, or from the transgres- 
 sion of a positive law of this country, there the court says he has no 
 right to be assisted. It is upon that ground the court goes, not for 
 the sake of the defendant, but because it will not lend its aid to such a 
 plaintiff. So if the plaintiff and defendant were to change sides, and 
 the defendant was to bring his action against the plaintiff, the latter 
 would then have the advantage of it, for where both are equally in, 
 fault, potior est conditio defendentis." 
 
 Bixby V. Moor, 51 N. H. 402, is a case strongly in point. In that 
 case it appears that the defendant kept a billiard saloon and a bar 
 for the sale of liquor. The liquor traffic was illegal. The plaintiff 
 was employted by the defendant to work generally in and about the 
 saloon. There was no special agreement that he should or should not 
 sell liquor, or what particular duty he should do. But he was accus- 
 tomed to work generally in and about the saloon, taking care of the 
 room, building fires, taking care of the billiard tables, tending bar, 
 and waiting upon customers, and, in the absence of the defendant, he 
 had the whole charge of the business. In assumpsit, upon a quantum 
 meruit, it was held that he could not recover compensation for any 
 portion of his services. The court say : "In the present case, however, 
 there is room for but one conclusion, namely, that the agreement was 
 that the plaintiff at the defendant's request should perform all the 
 services which he did in fact perform, and that the defendant, in con- 
 sideration of the promise to perform (and the performance of) all 
 those Services, the illegal as well as the legal, should pay the plaintiff 
 the reasonable worth of the entire services. In other words, the plain- 
 tiff made an entire promise to perform both classes of services. This 
 entire promise (and the performance thereof) formed an entire con- 
 sideration for the defendant's promise to pay, and a part of this in- 
 divisible consideration was illegal." 
 
 In the present case the sums which the defendant promised to pay 
 formed one entire consideration for all the services to be rendered by 
 the plaintiff, both those in tending the bar, which were illegal, and 
 those as clerk in the grocery store, which were legal. Had one price 
 been agreed upon for the services as bar-keeper, and another as clerk 
 in the grocery business, so that it would have been possible to sepa- 
 rate the legal from the illegal part of the transaction, an action could 
 have been maintained for the services which Were legal ; but, as it is, 
 the defendant's promise being entire, and the consideration for it 
 being partly legal and partly illegal and indivisible, both parties are to 
 be regarded as equally in fault, and the law will lend its aid to neither. 
 
 Petition granted.*" 
 
 80 Sometimes a contract is so constructed that "is held to be divisible, the 
 lawful part being enforced. Shaw v. Carpenter, 54 Vt. 155, 41 Am. Rep. 837 
 
1374 THE STATUTE OF FRAUDS (Ch. 10 
 
 CHAPTER X 
 THE STATUTE OF FRAUDS 
 
 ST. 29 GAR. II, c. 3 (1677). AN ACT FOR PREVENTION 
 OF FRAUDS AND PERJURIES 
 
 Sec. 4. And be it further enacted that from and after the said 24th 
 day of June no action sha-ll be brought whereby to charge any execu- 
 tor or administrator upon any special promise to answer damages out 
 of his own estate ; or whereby to charge the defendant upon any spe- 
 cial promise to answer for the debt, default, or miscarriages of an- 
 other person; or to charge any person upon any agreeinent made 
 upon consideration of marriage ; or upon any contract or sale of lands, 
 tenements, or hereditaments, or any interest in or concerning, them; 
 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 memora.ndum 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.^ 
 
 (3S8i), sale. of stock in trade and good will for $3,221, ihcluding liquors il- 
 legally sold, separately valued at $218; Edleson v. Edleson, 179 Ky. 300, 200 
 S. W. 625, 2 A. L. R. 689 (1918), separation agreement for, division of 
 property, care of children, and not to contest divorce action ; Fishell v. Gray, 
 60 N. J. Law, 5, 37 Atl. 606 (1897) ; United States v. Bradley, 10 Pet. 343, 
 360, 364, 9 L. Ed. 448 (1836) ; Gelpcke v. Dubuque, 1 Wall. 221, iT L. Ed. 
 030 (1863) ; McCullough v. Virginia, 172 V. S. 102, 19 Sup. Ct. 134, 43 L. Ed. 
 382 (1898) ; Osgood v. Bauder, 75 Iowa, 550, 39 N. W. 887, 1 L. R. A. 655 
 (1888) ; Dean v. Emerson, 102 Mass. 4S0 (1869) ; Peltz v. Eichele, 62 Mo. 171 
 (1876) ; Smith's Appeal, 113 Pa. 579, 6 Atl. 251 (1886) ; Osgood v. Cent. 
 Vt. R., 77 Vt. 334, 60 Atl. 137, 70 L. R. A. 930 (1905). 
 
 The contract was held indivisible and void as a whole in Johnson v. Mc- 
 Million, 178 Ky. 707, 199 S. W. 1070, L. R. A. 19180, 244 (1918) , money loaned 
 in part to spirit away a witness; Bixby v. Moor, 51 N. H. 402 (1871) ; Bishop 
 V. Palmer, 146 Mass. 469, 16 N. E. 299, 4 Am. St. Rep. 339 (1888) ; Handy r. 
 St. Paul Globe Pub. Co., 41 Minn. 18g, 42 N. W. 872, 4 L. R. A. 466, 16 Am. 
 St. Rep. 695 (1889) ; Ramsey's Estate v. Whitbeck,183 111. 550, 56 N. E. 322 
 (1900) ; Saratoga County Bank v. King, 44 N. Y. 87 (1870) ; Foley v. Speir, 
 100 N. X. 552, 3 N. E. 477 (18S5) ; Owens v. Wilkinson, 20 App. D. C. 51 (1902) ; 
 «edgwick County v. State, 66 Kan. 634, 72 Pac. 284 (1903) ; Baines v. 
 Geary, 35 Ch. D. 154 (1887) ; Baker v. Hedgecock, 39 Oh. D. 520 (1888) ; 
 Bromley v. Smith, [1909] 2 K. B. 235. 
 
 Even though the consideration given by the plaintiff is entire and indivisi- 
 ble, if it is iin every respect lawful, the plaintiff can enforce such promises of 
 the defendant as are lawful, even though he made another independent 
 unlawful promise. Erie Ry. Co. v. Union Locomotive & Express Co., 35 N. 
 J. Law, 240 (1871) ; W. T. Rawleigh Medical Co. v. Walker, 16 Ala. App. 
 232, 77 South. 70 (1917), one of defendant's promises was in illegal restraint 
 of trade; State ex rel. Laskey v. Board of Education of Perrysburg Tp., 
 35 Ohio St. 519 (1880). 
 
 1 This section has been re-enacted, with few substantial changes, by the 
 Legislatures of all the states in this country. 
 
^^^- ^) CONTEACTS OF GUARANTY 1375 
 
 Sec. 17. And be it further enacted by the authority aforesaid, that 
 from and after the said 24th day of June no contract for the sale of 
 any goods, wares, or merchandises, for the price of ten pounds ster- 
 hng or upwards, shall be allowed to be good, except the buyer shall 
 accept part of the goods so sold, and actually receive the same, or give 
 somethmg in earnest to bind the bargain, or in part payment, or that 
 some note or memorandum in writing of the said bargain be made aiid 
 signed by the parties to be charged by such contract, or their agents 
 thereunto lawfully authorized.^ 
 
 SECTION 1.— CONTRACTS OF GUARANTY 
 
 THOMAS V. WELLES. 
 
 (Superior Court of Connecticut, 1773. 1 Root, 57.) 
 
 Error. Welles was a constable of the town of Hartford, had a rate 
 warrant and a rate against Jacob Brown for which he levied upon 
 Brown's body and was about to commit him to gaol. Thomas, in 
 consideration that Welles would suspend any further proceedings 
 
 2 This section has been re-enacted with some variations in all the American 
 jurisdictions except Alabama, Arizona, Delaware, Illinois, Kansas, Kentucky, 
 Louisiana, New Mexico, North Carolina, Ohio, Pennsylvania, Rhode Island, 
 Tennessee, Texas, Virginia, and West Virginia. 
 
 The price is fixed at $30 in Arkansas, Maine, Missouri, and New Jersey ; 
 at $38 ^n 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 Island, 
 and some other states. The provisions in this act that correspond to section 
 17 of the original Statute of Frauds, as adopted in New York (Laws 1911, 
 c. 571 [ConsoL Laws, c. 41] S 85), are as follows: 
 
 "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, not- 
 withstanding that the goods may be intended to be delivered at some future 
 time or may not at the time of such contract or sale be actually made, pro- 
 cured, or provided, or fit or ready for delivery, or some act may be requisite 
 for the making or completing thereof, or rendering tlie 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." 
 
1376 THE STATUTE OP- FRAUDS (Ch. 10 
 
 against Brown that night, assumfed and prdmised" that he would see 
 him forthcoming to said officer! the next morning, or he would pay 
 the debt. Upon this Welles released said Brown, and Thomas did 
 not see him forthcoming, nor has he paid the debt, &c. 
 
 Plea in bar — The statute against frauds and perjuries; demurrer. 
 Judgment — That the plea is insufficient, and for plaintiff to recover. 
 
 Error assigned is — That the plea was sufficient. Judgment — rMani- 
 fest error; for this is clearly a promise for the debt and duty of 
 another. 
 
 KANTER V. M. HOFHEIMER & CO., INC. 
 
 (Supreme Court of Appeals of Virginia, 1916. 118 Va. 625, 88 S. E. 60.) 
 
 Action by M. Hofheimer & Co., Incorporated, against Israel Kan- 
 ter. There was judgment for plaintiff, and defendant brings error. 
 Affirmed. 
 
 Whitti<E, J. From the point of view of a demurrer to the evi- 
 dence, the essential facts of this case are these: Plaintiff in error, 
 Kanter (who was defendant below), for several years prior to 1912 
 had been engaged in the retail liquor business in the city of Norfolk, 
 where for some violation of the statute his license was revoked. 
 Thereupon Kanter, in association with his brother-in-law, Kesser, and 
 one Rice, organized and had incorporated the South Norfolk Liquor 
 Company, and through the agency of Rice the corporation obtained 
 from the circuit court of Norfolk county a license to keep an ordinary 
 in South Norfolk, a suburb of the city of Norfolk. Kanter practically 
 owned the entire stock and conducted the business of the corporation 
 as the general manager. While in business in the city of Norfolk he 
 was a customer of the defendant in error, and bought his stock of liq- 
 uors from that concern. As soon as the corporation was organized and 
 licensed, Kanter approached the secretary and treasurer of M. Hof- 
 heimer & Co., Incorporated, for the purpose of establishing trade re- 
 lations between them and his corporation, and to purchase the opening 
 stock; but the offer was declined, and the secretary and treasurer 
 absolutely refused to do business with the corporation or to sell it 
 goods, but agreed to sell the stock to Kanter as an individual and de- 
 liver the goods to the South Norfolk Liquor Company. That proposi- 
 tion was accepted, and the goods (for the price of which the judgment 
 under review against Kanter was recovered) were sold in pursuance 
 of that agreement. 
 
 The plaintiff in error seeks to escape liability on two grounds: 
 
 1. That the sale was made to the South Norfolk Liquor Company, 
 Incorporated, and that Kanter was not liable therefor under the stat- 
 ute of frauds, because his promise to pay was not in writing. 
 
 That issue of fact was submitted to the jury upon correct instruc- 
 tion, and, upon conflicting evidence, having been resolved in favor of 
 
^^*^- ■'■) CONTRACTS OF GUARANTY I377 
 
 the plaintiff, the finding of the jury is conclusive. Kanter's liability 
 being positive and personal, not contiftgent and collateral, the trirts- 
 action was not within the statute of frauds. 2 Va. Law Reg 465 • 
 Hopkins V. Richardson, 9 Grat. (SO Va.) 485; Noyes' Ex'x v Hum- 
 phreys, 11 Grat. (52 Va.) 636; Wright v. Smith, 81 Va. 777; Skinner 
 V. Armstrong, 86 Va. 1015, 11 S. E. 977. 
 
 2. That if the sale was made to Kanter, With knowledge that the 
 liquor was to be resold by him in violation of the statute, plaintiff 
 could not recover. 
 
 That issue was likewise submitted to the jury upon an extremely 
 favorable instruction as to the defendant's contention, and the jury 
 again adopted the theory of the plaintiff that Kanter purchased the 
 goods upon his individual credit for a ' corporation in which he was a 
 controlling stockholder, and which, under its license, had the lawful 
 right to sell the Hquors. 
 
 The jury having so found, upon proper instructions and sufficient 
 evidence, and their verdict having been sustained by the trial court, on 
 familiar principles, it cannot be disturbed in this court. ' 
 
 We are of opinion that the judgment should be affirmed.* 
 
 GRIFFIN v. CUNNINGHAM. 
 (Supreme Judicial Court of Massachusetts, 1903.' 183 Mass. 505, 67 N. E. 660.) 
 
 Action by one Griffin against one Cunningham. Verdict for plain- 
 tiff, and defendant excepts. Exceptions overruled. 
 
 Contract to recover for lumber furnished by the plaintiff to one 
 Griffiths, a contractor, for the purpose of making alterations on a 
 house owned by. the defendant. Griffin proposed to bring a suit against 
 
 3 Where the sole credit is given to the defendant, his promise is not within 
 the statute of frauds ; there is no other debtor for whose default he is 
 promising to answer, and this is true, even though the consideration for the 
 defendant's promise is the delivery of goods to a third person or the rendering 
 of service to him. Lakeman v. Mountstephen, L. K. 7 H. L. 17 (1874) ; 
 Janvrin v. Powers, 79 N. H. 44, 104 Atl. 252 (1918) ; Weil v. Centerfit, 201 
 A-la. 531, 78 South. 885 (1918), doctor cared for defendant's servant; Mackey 
 V. NickoU, 60 Okl. 12, 158 Pac. 593 (1916) •,'■ Banfield v. Davidson (Tex. Civ. 
 App.) 201 S. W. 442 (1918) ; Powell Lumber Co. v. Dalton (Mo. App.) 185 
 S. W. 530 (1916) ; Oordray v. James, li9 Ga. App. 156, 91 S. E. 239 (1917) ; 
 Larson v. Jensen, 53 Mich. 427, 19. N. W. 130 (1884) . 
 
 If for any reason no other person is bound, the defendant's promise is not 
 within thie statute. Mease v. Wagner, 1 McCord (S. 0.) 395 (1821), promise 
 to pay for funeral supplies ; Fox & Weeks v. Laney, 107 S. C. 318, 92 S. E. 
 1044 (1917), same; Harlan v. Harlan, 102 Iowa, 701, 72 N. W. 286 (1897). 
 But a promise to guaranty a minor's debt is within the statute. Dexter v. 
 Blanchard, 11 Allen (Mass.) 365 (1865) ; Scott v. Bryan, 73 N. C. 582 (1875). 
 Joint Contracts. — No writing is required to bind A., where A. and B. 
 promise jointly to pay for goods delivered to B. (This seems to be due to 
 a fiction of unity as to the two promisors.) Gibbs v. Blanchard, 15 Mich. 292, 
 (1867) ; Bryant v. Panter, 91 Or. 686, 178 Pac. 989 (1919) ; Galamba v. 
 Harrison ville Pump & Foundry Co. (Mo. App.) 191 S. W. 1084 (1917). 
 
 COEBIN CONT 87 
 
1,378 THE STATUTE OF FEAUDS (Ch. 10 
 
 Griffiths, and the three parties entered into an agreement by, which 
 Cunningham .promised to pay Griffin the amount of his bill against 
 Griffiths, if Griffiths approved the bill, payments to be made direct to 
 Griffin. 
 
 BralEY, J. If the promise made to the plaintiff by the defendant 
 was nothing more than an oral agreement on his part to pay any bal- 
 ance due Griffiths that remained after a settlement of liens for labor, 
 the undertaking was collateral, as the original debt owed by Griffiths to 
 the plaintiff was not extinguished. And as it is not claimed that the 
 defendant derived any benefit ;from the arrangement, the statute of 
 frauds on which the defendant relies would be a full defense. Curtis 
 V. Brown, 5 Cush. 488 ; Manley v. Geagan, 105 Mass. 445 ; O'Connell 
 V. Mount Holyoke College, 174 Mass. 511, 514, 55 N. E. 460. But 
 there was something more. What the. parties agreed to was in dispute. 
 And as the case is before us on a refusal to rule that upon all the evi- 
 dence the plaintiff' could not recover, it becomes necessary to deter- 
 mine whether there was any evidence to sustain- the verdict. 
 
 The plaintiff puts his case on a substitution of debtors, and his evi- 
 dence in substance tended to prove that Griffiths, who was owing him 
 a large amount for lumber that had been used in reconstructing a 
 house belonging to the defendant with whom Griffiths had a contract 
 to furnish hiaterials and do the work, agreed that the balance coming 
 to him under the contract should be paid by the defendant to the 
 plaintiff in settlement of his bill for the lumber, and that the defend- 
 ant, at whose suggestion the arrangement was made, assented to the 
 substitution, and promised to pay the plaintiff the balance remaining 
 due under the contract after the settlement of any liens for labor. Re- 
 lying on this agreement, and in consequence of it, the plaintiff released 
 Griffiths, his original debtor, and looked to the defendant solely for 
 the payment of his bill. The question is, what was the intention of the 
 parties? and, in order to determine the character of the transaction, 
 all the circumstances are to be considered. 
 
 The substitution sought to be accomplislied was a change of debtors 
 to the extent of the plaintiff's claim against Griffiths, and it was not 
 necessary that the whole indebtedness of the defendant to Griffiths, if 
 it exceeded the amount of the plaintiff's bill, should have been dis- 
 charged. But the arrangement between the parties was enough under 
 the evidence in this case to fully discharge the defendant from any lia- 
 bility under the building contract, as there was ho contention that the 
 amount due the plaintiff from Griffiths was more than the sum finally 
 paid to him by the defendant in the settlerrient made between them. 
 There was also evidence from which the jury might find that the orig- 
 inal debt of Griffiths to the plaintiff had been discharged, though this 
 follows if mutual consent to the substitution is proved. Walker v. 
 Sherman, 11 Mete. 170. If the claim of the plaintiff against him had 
 been converted info a claim of the plaintiff against the defendant, it is 
 not necessarj' to consider the transaction as a possible assignment of a 
 
Sec. 1) CONTRACTS OF GUARANTY 1379 
 
 part of the claim of Griffiths against Cunningham, and that in such a 
 case the plaintiff could have relief only in equity. See James v. New- 
 ton, 142 Mass. 366, 374, 8 N. E. 122, 56 Am. Rep. 692; Holbrook v. 
 Payne, 151 Mass. 383, 384, 24 N. E. 210, 21 Am. St. Rep. 456. Under 
 the plaintiff's evidence, the defendant, by accepting the order of Grif- 
 fiths, Vifho signed it with the understanding that the bill of the plain- 
 tiff was to be paid by the defendant, contracted hot only to pay the 
 debt, but also, as a part of the transaction, undertook that the debt 
 should be paid to the plaintiff, while the plaintiff at the same time 
 agreed to accept . the defendant as his debtor in place of Grif- 
 fiths. It would not be enough that the defendant' accepted the or- 
 der; he must go further and promise to pay the plaintiff. The con- 
 sideration for the promise is that the plaintiff, as a^ part of the com- 
 pleted arrangement, became bound to look solely to the defendant 
 for the money owed him, instead of to Griffiths. If the original debtor 
 did not remain liable, the defendant's promise was not to answer for 
 the debt of another, and it was not within the statute. Furbish v. 
 Goodnow, 98 Mass. 296 ; Richardson v. Robbins, 124 Mass. 105. For 
 these reasons, the case does not fall within Curtis v. Brown, ubi su- 
 pra, as argued by the defendant, but is to be governed by Caswell v. 
 Fellows, 110 Mass. 52, 54; Eden v. Chaffee, 160 Mass! 225, 35 N. E. 
 675; Trudeau v. Poutre, 165 Mass. 81, 42 N. E. 508; and Plummei- 
 V. Greenwood, 169 Mass. 584, 48 N. E. 782 ; and is to' be distinguish- 
 ed from the Ime of decisions in which this court has held that a stran- 
 ger to a simple contract, and from whom no consideration moves, can- 
 not sue on it, or enforce a promise made to another for his benefit.. 
 Exchange Bank v. Rice, 107 Mass. 37, 9 Am. Rep. 1; Borden v.x 
 Boardman, 157 Mass. 410, 32 N. E. 469, and cases cited; Aldrich v. 
 Carpenter,' 160 Mass. 166, 35 N. E. 456. 
 
 In the case at bar the plaintiff was the promisee, and the contract 
 between him and the defendant gave all the contractual rights pro- 
 vided for his benefit, and had an ample consideration to support it by 
 the release of the original debtor. If there had been no conflict of tes- 
 timony and the terms of the alleged substitution of debtors was not 
 in dispute whether enough had been made out to establish the claim- 
 ed novation would have been a matter of law for the court But there 
 were two possible conclusions on the evidence: If the defendant was 
 believed the plaintiff could not prevail; while if the plamtiff s testi- 
 mony w'as accepted as true, a complete substitution had taken place, 
 and the defendant was liable. Obviously it could not be ruled as 
 
 matter of law that the plaintiff was not entitled to recover ; and, as the 
 case was submitted to the jury under instructions not excepted to, the 
 presumption is that they were full and accurate, and the order must be 
 
 Exceptions overruled.' 
 
 •D ..+T, V TTis-hmie 60 N. T. 238, 19 Am. Kep. 171 (1875) ; 
 
 ^i'^i^'^'^Tnhn ? B^ee & CO i98 Ala 234, 73 South. 472 (1916) ; Milovsky 
 
 v.^?h"a?r; (SupO-?72*N y'^sW 346 (1918); Meriden Britannia Co. y. 
 
1380 THE STATUTE OF FRAUDS (Ch. 10 
 
 EAST\^'00i:( V. KENYON. 
 (In the Court of Queen's Bench, 1840. 11 Adol. & B. 438.) 
 
 I,ord Denman, C. J.'' The first point in this case arose on the 
 fourth section of the Statute of Frauds, viz., whether the promise of 
 the defendant was to "answer for the debt, default, or miscarriage of 
 another person." Upon the hearing we decided, in conformity with 
 the case of Buttemere v. Hayes, 5 M. & W. 456, that this defence 
 might be set up under the plea of non assumpsit. 
 
 The facts were that the plaintiff was liable to a Mr. Blackburn on 
 a promissory note ; and the defendant, for a consideration, which may 
 for the purpose of the argument be taken to have been sufficient, prom- 
 ised the plaintiff to pay and discharge the note to Blackburn. If the 
 promise had been made to Blackburn, doubtless the statute would 
 have applied : it would then have been strictly a .promise to answer for 
 the debt of another ; and the argument on the part of the defendant 
 is, that it is not less the debt of another, because the promise is made 
 to that other, viz., the debtor, and not to the creditor, the statute not 
 having in terms stated to whom the promise, contemplated by it, is to be 
 made. But upon consideration. we are of opinion that the statute ap- 
 plies only to promises made to the person to whom another is answer- 
 able. We are not aware of any case in which the point has arisen, or 
 in which any attempt has been made to put that construction upon the 
 statute which is now sought to be established, and which we think not 
 to be the true one." * * * 
 
 GUILD & CO. v. CONRAD. 
 (Court of Appeal. [1894] 2 Q. B. 885.) 
 
 EiNDivEY, L. J.'' This case is one of considerable difficulty and very 
 near the hne. The question is, what is the nature of the promise 
 which the defendant made to the plaintiff. It appears that the real 
 
 Zlngsen, 48 N. T. 247, 8 Am. Rep. 549 (1872) ; Whitaker v. Greene (E. I.) 
 103 Atl. 779 (1918) ; Williams v. Garrison, 21 Ga. App. 44, 93 S. E. 510 
 (1917) ; Goodman v. Chase, 1 B. & Aid. 297 (1818). 
 
 ' The statement of facts is omitted and only a part of the opinion is here 
 printed. That part dealing with the validity of past consideration is printed 
 ante, p. 393. 
 
 « In accord : Landow & Co. v. Gurian, 93 Conn. 576, 107 Atl. 517 ; Bryant 
 V. Jones, 183 Ky. 298, 209 S. W. .30 (1919) ; McEwen v. VoUentine (Okl.) 170 
 Pac. 490 (1918) ; Dodds v. Spring, 174 Cal. 412, 163 Pac. 351 (1917), as- 
 sumption of mortgage debt by grantee of mortgagor ; McAndrew v. Sowell, 
 100 Kan. 47, 163 Pac. 653 (1917), same; Moore v. Kiikland, 112 Miss. 55, 
 72 South. 855 (1916) ; Meyer v. Hartman, 72 111. 442 (1874) ; Clay Lumber 
 Co. V. Hart's Branch Coal Co., 174 Mich. 613, 140 N. W. 912 (1913) ; Smart 
 V. Smart, 97 N. Y. 559 (1885) ; Pike v. Brown, 7 Cush. (Mass.) 183 (1851). 
 
 ' The statement of facts and the concurring opinions of Lopes and Davey, 
 L. JJ., are omitted. 
 
Sec. 1) CONTRACTS OF GUARANTY 
 
 1381 
 
 plaintiff, Mr. Binuey, is a merchant who was in correspondence with a 
 Demerara firm of Conrad, Wakefield & Co., one of the partners in 
 which was a son of the defendant ; and by a letter of June, 1888, the 
 defendant agreed that, if the plaintiff would give credit to the Dem- 
 erara firm to the extent of £5000, the defendant would indemnify the 
 plaintiff to that extent.. There is no question that that was a guaran- 
 tee in the proper sense of the term ; that is to say, it was an under- 
 taking by the defendant to be responsible for the Demerara firm for 
 £5000. This was in writing ; but by a verbal guarantee the amount 
 was enlarged afterwards, in March, 1891, to' £6000. The plaintiff 
 claimed that enlarged amount under this verbal guarantee; but the 
 learned judge below has decided this claim in favor of the defend- 
 ant, and no appeal has been brought in respect of that decision. As 
 time went on, the Demerara firm got overdrawn; and at last, in De- 
 cember, 1891, the plaintiff was so reluctant to accept their bills that he 
 eventually declined to do so; and an interview then took place be- 
 tween the plaintiff and defendant and Wakefield, a member of the 
 Demerara firm. This interview took place on December 31, 1891, 
 when bills of that firm for £5950 were about to become due, but which 
 the plaintiff would not accept ; and in the following January a second 
 interview took place in consequence on some further bills to the amount 
 of £5280. One of the difficult points in this case is to find out 
 what took place at those interviews. The promises said to have been 
 made were verbal only. Wakefield, one of the parties present at the 
 interviews, is dead. The testimony of the plaintiff and the defend- 
 ant upon the subject differ entirely. The plaintiff's version is to the 
 effect that the defendant undertook to indemnify him against those 
 bills if he, the plaintiff; would accept them. The defendant's ver- 
 sion is that he did not give any such undertaking; and that was the 
 controversy which was before the jury. The jury has decided that 
 controversy in favour of the plaintiff. They have found, after hear- 
 ing the evidence, that tlje defendant is wrong; that he did in fact 
 make a promise to find the funds for both batches of bills, and 
 to indemnify the plaintiff against .them. I do not now consider the 
 question of the form of the promise — whether it imposed a primary 
 or a secondary liability. I pass that by for the moment. But the 
 struggle on the main point resulted in favour of the plaintiff. The 
 jury were then discharged, and it was arranged that any other ques- 
 tions which might arise in the case should be left to the judge. The 
 judge then addressed his mind to the question whether the prom- 
 ise found by the jury to have been made by the defendant was in 
 ,such a shape that the Statute of Frauds rendered it nugatory unless 
 it was in writing, or whether it was such that the Statute of Frauds 
 did not apply to it. The question whether that was brought before 
 the jury seems a little uncertain. The learned judge, having seen 
 the witnesses and read the correspondence, came to the conclusion. 
 
1382 THte STATUTE OF FEAUDS (Ch. 10 
 
 that the promise was to the effect I will state presently. I will read 
 the learned judge's own words. At the end of his judgment' he says, 
 the defendant's promise "was not a contract to pay if the foreign 
 firm did not pay, because there was no expectation at that time that 
 the foreign firm would be able to pay. The contract was to find 
 funds to enable the plaintiff to meet these acceptances." Now, wheth- 
 er the jury meant that or not is doubtful. The question is one of 
 fact, and if it was not decided by the jury then it was' left to the 
 finding of the judge, and I hsrve. read what his finding was. Ought 
 we to differ from that finding? We are urged to say that the judge 
 was wrong in his finding ; that the evidence did not come up to that ; 
 and that the defendant's promise was merely a contract to. pay the 
 plaintiff if the Demerara firm did not pay. That, in my Opinion, is 
 a difficult question. The evidence is loose unquestionably; but I 
 cannot bring my mind to say that it cannot bear the construction 
 which the learned judge put upon it. The nature of the promise is 
 all-important: because, if it was a promise to pay if the Demerara 
 firm did not pay, then it is void under the Statute of Frauds as not 
 being in writing. But if, on the other hand, it was a promise to put 
 the plaintiff in funds in any eyent, then it is not such a promise as 
 is within the Statute of Frauds. I think that the learned judge has 
 taken the true view, though it is very near the line. I cannot help 
 thinking that the true result of those interviews was this — that the de- 
 fendant did promise the plaintiff that, if he would accept those batches 
 of bills, he, the defendant, would take care that they should be met, 
 and that he himself would provide funds to meet them; and it was 
 on the faith of that promise that the plaintiff accepted those bills. 
 If this is the real contract, and if the learnedjudge is right in saying 
 that the contract was not a contract to pay if the Demerara firm did 
 not pay, but was a contract to pay in any event, then, in my opinion, 
 the authorities shew that the Statute of Frauds does not apply. The 
 authorities are Thomas v. Cook, 8 B. & C..728, and Wildes v. Dud- 
 low, Law Rep. 19 Eq. 198. Thomas v. Cook, 8 B. & C. 728, ap- 
 pears to me to be undistinguishable from this case, if the facts here 
 are such as I take them to be. There a man named Cook and a man 
 named Morris had been in partnership; and on the dissolution of 
 the partnership it was agreed that Cook should pay the partner- 
 ship debts, and it was also agreed that a bond of indemnity, exe- 
 ci^ted by W. Cook, since deceased, and two other persons, should 
 be given to Morris to save him harmless from the pa:yment of those 
 debts. It being necessary that two sureties should be found to join 
 in the bond, the plaintiff agreed to become one of the sureties on a 
 promise by the defendant to indemnify him, the plaintiff, from all 
 liability by reason of his joining in the bond. The decision was 
 as follows: After pointing out that Morris was a creditor, Bayley, 
 J., said this: "Here the bond was given to Morris as the creditor; 
 
Sec. 1) C0N'rKA.CTS of guaranty 1383 
 
 but the promise in question was not made to him. A promise to him 
 would have been to answer for the default of the debtor. But it being 
 necessary for W. Cook, since deceased, to find sureties, the defendant 
 applied to the plaintiff to join him in the bond and undertook to save 
 him harmless. A promise to indemnify does not, as it appears to 
 me, fall within either the words or the policy of the Statute of Frauds." 
 Then Parke, J., said: "This was not a promise to answer for the debt, 
 default or miscarriage of another person, but an original contract be- 
 tween these parties, that the plaintiffs should be indemnified against 
 the bond. If the plaintiff, at the request of the defendant, had paid 
 money to a third person, a promise to repay it need not have been in 
 writing, and this case is in substance the same." 
 
 I need not refer to other cases which have followed that ; but 
 
 1 must notice the argument which has been addressed to us that 
 Thomas v. Cook, 8 B. & C. 728, is bad law. Unquestionably it was 
 not followed by the Court of Queen's Bench in Green v. Cresswell, 
 10 Ad. & E. 453, and Cripps v. Hartnoll, 31 L. J. N. S. (Q. B.) 150, 
 
 2 B. & S. 697; but, notwithstanding the criticism of the learned 
 judges in those cases, Thomas v. Cook, 8 B. & C. 728, was set on its 
 feet again by the decision of the Court of Exchequer Chamber in the 
 latter case, 32 L. J. N. S. (Q. B.) 381, 4 B. & S. 414; and it has since 
 held its ground; and after the decision in Eastwood v. Kenyon, 11 
 Ad. & E. 438, it is impossible to hold that a promise made by the 
 defendant to the plaintiff to indemnify the plaintiff against a debt 
 due from him to a third person is within the statute, and therefore 
 required to be in writing. In my opinion the decision in Thomas v. 
 Cook, 8 B. & C. 728, was right, and it is treated as good law in Har- 
 greaves v. Parsons, 13 M. & W. 561, and it is supported in Reader v. 
 Kingham 13 C. B. (N. S.) 344. The modern cases of Wildes v. Dud- 
 low Law Rep. 19 Eq. 198, and In re Bolton (1892) W. N. 163, 8 Times 
 L R 668, are equally good law. Such being the case, it follows that 
 the main defence here— namely, that the promise is bad as not being m 
 writing within the Statute of Frauds— breaks down. 
 
 [The Lord Justice then dealt with certain other points urged on 
 behalf of the appellant upon the facts of the case, and held that those 
 points failed. The Lord Justice continued:] . , ^ ^ ,, 
 
 The main questions are, what was the promise? And, secondly, 
 whether the promise was such as is required by the Statute of Frauds 
 to be in writing. The promise is, in my opinion, clear; and the Court 
 below has found that the promise was a promise to indemnify, and 
 Serrfore not within the Statute of Frauds. That decision is, m my 
 opinion, right, and therefore the appeal must be dismissed. 
 
 a A promise to indexnmfy one who becomes bailor surety for^a^^^^^^ 
 Ann. Cas. 1912A, 88/! (Iwiy) . ^""'^fSi ti, irq q7 N E 875 (1894) ; Mills v. 
 
 ^fo^fi^^'iorrfsTiSr/idr^^^^ ^« ^^«^^>= 
 
1384 THE STATUTE OF FRAUDS (Ch, 10 
 
 BAILEY V. MARSHALI/. 
 (Supreme Court of Pennsylvania, 1896. 174 Pa. 602, 34 Atl. 326.) 
 
 Dean, J. Whether the debt, in controversy be that of him who has 
 assumed to pay it, or of another, is in most cases a question of fact. 
 There can be no precise legal definition of liability under the act of 
 26th of April, 1855 (P. L. 308), which will determine in all cases — ^per- 
 haps in but very few — ^the answerability of him who promises to pay. 
 The act says : "No action shall be brought whereby to charge * * * 
 the defendant upon any special promise to answer for the debt or de- 
 fault of another unless the agreement * * * shall be in writing." 
 This is clearly meant to relieve an alleged guarantor or surety. It was 
 never intended to relieve him who had a personal, beneficial interest in 
 the assumption. There cannot be a better construction of this statute 
 than in Nugent v. Wolfe, 111 Pa. St. 480, 4 Atl. 15, where we held 
 (the present chief justice- rendering the opinion) that: "It is difficult, 
 if not impossible, to formulate a rule by which to determine in every 
 case whether a promise relating to the debt or liability, of a third per- 
 son is or is not within the statute; but asl a general rule, when the 
 leading object of the promise or agreement is to become guarantor or 
 surety to the promisee for a debt for which a third party is and con- 
 tinues to be primarily liable, the agreement, whether made before or 
 after or at the time with the promise of the principal, is within the 
 statute, and not binding unless evidenced by writing. On the other 
 hand, when the leading object of the promisor is to subserve some in- 
 terest or purpose of his own, notwithstanding the effect is to pay or 
 discharge the debt of another, his promise is not within the statute." 
 
 Applying these principles to the facts in the case before us, to what 
 conclusion do they impel us? In September, 1892, Mary E. Bailey 
 held a note .against Davis Pennock, in the sum of $1,000, with power of 
 attorney to confess judgment. At this time Marshall, .the defendant, 
 entered a judgment against Pennock for $5,000, issued execution, and 
 levied on all the real and personal property of Pennock. The amount 
 actually due and payable on his $5,000 judgment did not exceed, as 
 appeared afterwards, from his own statement, $200. The plaintiff was 
 standing there with her judgment ready for entry on which she could 
 immediately issue execution, seize and bid upon the property. Just at 
 this , juncture, Marshall, knqwing her rights, sent for her, and said, 
 "I will stand by thee, and see thee is paid every cent, if thee says noth- 
 ing and does nothing." She accepted his proposition, — neither entered 
 
 Boyer v. SouJes, 105 Mich. 31, 62 N. W. 1000 (1895) ; Fidelity & Casualty Co. 
 of New York v. Lawler, 64 Minn. 144, 66 N. W. 143 (1896) ; Jones v. Bacon, 
 145 N. Y. 446, 40 N. E. 216 (1895) ; contra : May v. Williams, 61 Miss. 125, 48 
 Am. Rep. 80 (1883) ; Nugent v. Wolfe, 111 Pa. 471, 4 Atl. 15, 56 Am. Rep. 291 
 (1886) ; Hurt v. Ford, 142 Mo. 283, 44 S. W. 228, 41 L. R. A. 823 (1897) ; 
 Kelsey v. Hibbs, 13 Ohio St. 340 (1862) ; Posten v. Clem, 201 Ala. 529, 78 
 South. 883, 1 A. L. R. 381, 3S3 (1918) (fully annotated). 
 
Sec. 1) CONTRACTS OF GUARANTT 1385 
 
 her judgment, nor took any steps to collect it. The sheriff's sale went 
 on, and Marshall bought the larger part of the real and personal 
 property, and was credited on his purchase with the amount of his 
 own judgment. 
 
 We notice by the testimony that Marshall denies the statement of 
 Mrs. Bailey. We express no opinion as to the credibility of the wit- 
 nesses. The question is, if the jury believed Mrs. Bailey's testimony, 
 would the court have been warranted in granting the compulsory non- 
 suit on the ground that the promise was to answer for the debt or de- 
 fault of another? What was the leading object of Marshall in making 
 the promise by which he lured her to inaction? Clearly, it was not to 
 pay Pennock's debt, nor Mrs. Bailey's claim. His sole purpose was to 
 silence her as an antagonistic bidder at the sheriff's sale. This was no 
 benefit to Pennock, the debtor. It was an advantage to Marshall, and 
 he reaped the full fruits of it. She was silenced by his promise, and 
 he got the property at his own figure. His leading object was to sub- 
 serve his own interest. In fact, he had no other object. Having ac- 
 complished it, he is now called upon to answer not for Pennock's debt, 
 but for his own ; and, if Mrs. Bailey be believed, he ought to pay. 
 
 The decree of the court below, entering compulsory nonsuit, is re- 
 versed, and procedendo awarded. 
 
 WALTHER V. MERRELL. 
 
 (St. liouis Court of Appeals, Missouri, 1878. 6 Mo. App. 370.) 
 
 Bakewell, J. The petition of plaintiff alleged that in March, 1877, 
 and for a long time prior thereto, and after that date, defendant vvas 
 president of a banking corporation called the Bank of St. Louis, doing 
 a general banking business in St. Louis ; that on July 12, 1877, plain- 
 tiff had $4,200 on deposit in said bank, which had been received and 
 deposited by him as receiver in a cause then pending ; that "on July 
 14, 1877, having fears as to the solvency of said bank and the safety of 
 the moneys so deposited, he went to said bank for the purpose of 
 withdrawing said funds from the same, as he had a lawful right to 
 do and as he could and would have done but that said defendant, who 
 was then the president of said bank, and otherwise largely interested 
 in the same as director, stockholder, and depositor, induced plaintiff 
 not to withdraw the same, and promised and agreed with him that if 
 he would not withdraw the same, that he (defendant) would pay plain- 
 tiff the total amount of his deposit if said bank should close. 
 
 "Plaintiff states that he knew or believed that defendant was sol- 
 vent and that he was abundantly able to pay plaintiff said money 
 should said bank close up ; and relying on the promise of said defend- 
 ant as aforesaid, and to accommodate him and comply with his re- 
 quest he did not withdraw said funds from said bank as he had intend- 
 
1386 THE STATUTE OF FRAUDS (Ch. 10 
 
 ed to do, and but for said promise should have done, but permitted 
 the same to remain in said bank in consequence of the promises. 
 
 "Plaintiff further states that thereafter, on the 16th day of July, 
 A. D. 1877, said bank did close up, and has ever since remained closed ; 
 that on or about the 20th day of July, A. D. 1877, plaintiff demanded 
 the amount of said deposits from defendant, who then and there 
 promised to pay the same, but failed, and has ever since failed to pay 
 the same to plaintiff. 
 
 "Plaintiff states, that he has received on account of said deposit 
 from said bank the sum of $2,072.75, and no more; that he has been 
 compelled to and has used his own funds to make good said deposit, 
 and is now discharged as receiver, and said funds and moneys now 
 belong to him ; that defendant is therefore indebted to plaintiff in the 
 sum of $2,072.75, with interest from July 20, 1877; for which, with 
 interest, he asks judgment." 
 
 The answer of defendant was a general denial. He further answer- 
 ed that the promise set out is within the Statute of Frauds, and that it 
 was not in writing. Plaintiff demurred to the new matter ; the demur- 
 rer was overruled, and final judgment was entered for defendant, from 
 which plaintiff appeals. 
 
 The promise in this case was to pay the debt of another, that ex- 
 isted when the promise was made, and continued to exist after the 
 promise. The statute says that such a promise, unless it be in writing, 
 is void. It by no means follows, however, that this promise, though 
 not in writing, is void ; because it is determined by a unanimous course 
 of decisions upon the statute that an oral promise to pay another's 
 debt may in some cases be binding upon the promisor though the debt 
 still exists in full force against the original debtor and in favor of the 
 original creditor. Attempts have been made at various times, by men 
 of great learning and ability, to classify the cases, and to arrange un- 
 der some general heads those decisions in which it has been held that 
 though there was a promise to pay the debt of another the statute does 
 not apply. The third class of Chancellor Kent in Leonard v. Vreden- 
 burgh, 8 Johns. (N. Y.) 29, 5 Am. Dec. 317, is "where the promise to 
 pay the debt of another arises out of some new consideration of ben- 
 efit or harm moving between the newly ^contracting parties." This 
 class of cases, he says, is not within the statute. Cases where the 
 promise is collateral to the principal contract, but made at the same 
 time, and ah essential ground of the original credit, and cases in which 
 the collateral undertaking is subsequent to the creation of the debt, 
 and not the inducement to it, though the subsisting liability is the 
 ground of the promise, are the first and second classes, to which, he 
 says, the statute applies. Chancellor Kent does not expressly say that 
 the consideration in the third class of cases must move to the promisor ; 
 but if this be added, then, where the main object of the promisor is not 
 to guarantee the debt, but to benefit himself, such cases have been held, 
 
Sec. 1) CONTRACTS OF GUAEANTY 1387 
 
 •in a long line of well-considered cases, not to fall within the statute. 
 On the other hand, the great name of Kent, and the general language 
 of his exception, have bred a class of cases that fly in the face of the 
 letter and the spirit of the statute and leave it nothing on which to 
 operate, by holding, as they do, that, if the new promise was supported 
 by any legal consideration, • it was not within the law. 
 
 The question is not at all whether there was a consideration for de- 
 fendant's promise. There must always be a consideration to support a 
 promise. That the consideration is coexisting with the promise, and 
 that it moves to the promisor, does not take the case out of the statute ; 
 for in all cases where credit is given on the strength of the promise of 
 another to see the debt paid, though this promise forms the considera- 
 tion for the credit, the contract, if not in writing, is void. Two things 
 are required — a consideration good at common law, and a promise in 
 writing — or the case is within the statute. Consideration alone will 
 not give vitality to a contract to pay another's debt, or the statute has 
 made no change in the law. 
 
 The question as to what oral promises are now within the statute 
 has been complicated by a vast number of decisions, which cannot 
 all be reconciled. It has been discussed in this country again and 
 again, by men who have brought to its consideration every quality 
 which can dignify and adorn the bench. The opinion of Chief Justice 
 Shaw, in Nelson v. Boynton, 3 Mete. (Mass.) 396, 37 Am. Dec. 148 ; 
 of Judge Comstock, in Mallory v. Gillett, 21 N. Y. 412; of Judge 
 Sill, in Kingsley v. Balcome, 4 Barb. (N. Y.) 132 ; of Judge Gray, in 
 Furbish v. Goodnow, 98 Mass. 297 ; of Chief Justice Poland, in Ful- 
 1am V. Adams, 37 Vt. 391, together with the essay of Judge Redfield, 
 appended to that; opinion, in 4 Am. L,. Reg. (N. S.) 473, leave little to 
 be desired by one who wishes to see what has been done to reduce to 
 • system the cases on this section of the Statute, of Frauds, and to draw 
 from them a rule that may be a guide to future decisions. In some 
 reported cases, the question as to whether or not the oral argument is 
 within the statute is disposed of by saying that the promise is collat- 
 eral or original, as the case may be, without stating the grounds upon 
 which this conclusion is based ; though the question in the case seems 
 to be, what is a collateral and what an original contract. Every con- 
 tract is original in a certain sense. 
 
 A stringent rule is that approved in Kingsley v. Balcome, 4 Barb. 
 (N Y.) 131, and Fullam v. Adams, 37 Vt. 391 ; that the undertak- 
 ing must be considered collateral, and not original, wherever the ac- 
 tual indebtedness is not extinguished, or at least assumed by the new 
 promisor, so that he stands to the creditor as bound to pay the debt 
 as his own; the new promisor holding the original debtor as a surety 
 to him and the understanding being in no sense collateral to the orig- 
 inal debt of another, which must have ceased to exist as an mdebted- 
 
1388 THE STATUTE OF FKAUDS (Gh. 10 
 
 ness due to the original creditor, or the case will be within the stat- 
 ute. The opinioti of Judge Sill in this case is cited with approval in 
 Bissig V. Britton, 59 Mo. 211, 21 Am. Rep. 379. Not that the rule as 
 above set forth is expressly adopted in that case. Indeed there seem 
 tq be cases of exception to the statute to which this rule could hardly 
 be made to apply. 
 
 The rule laid down in the Massachusetts cases seems to be this: 
 That where the main object of the promise is a benefit accruing di- 
 rectly to the promisor, and which he did not before enjoy, and the 
 promise to pay the debt of another is a mere incident, then the acci- 
 dental or incidental fact that the promise includes the answering for 
 the debt of another will not bring it within the statute ; but where the 
 main object is to obtain the release of the person or property of the 
 debtor, or other forbearance or other, benefit to him, then it is within 
 the statute, though a new consideration moves directly to the prom- 
 isor. Nelson v. Boynton, 3 Mete. (Mass.) 396, 37 Am. Dec. 148; Fur- 
 bish V. Goodnow, 98 Mass. 297. This rule has also been approved in 
 New York, in the case of Mallory v. Gillett, 21 N. Y. 412, in which the 
 cases are carefully examined. If we go beyond such peculiar cases, 
 and except from the statute instances in which the debtor alone is in- 
 terested, and where the debt still subsists, on the ground that there is 
 a consideration to support the contract, we virtually repeal the stat- 
 ute, and leave the law as it was before the act was passed, 
 
 We have turned to the cases in our own Reports cited by counsel, 
 and we are satisfied that none of these cases sanction, and that no 
 Missouri case sanctions, any greater relaxation of the statute than the 
 rule which we have extracted from the Massachusetts Reports and 
 from the New York case just cited. In Hursh v. Byers, 29 Mo. 469, 
 defendant had promised plaintiff, a tavern-keeper, that if he would let 
 Mrs. Acors remove her baggage, he would pay her tavern-bill. The. 
 landlord, on the faith of this promise, let the baggage go. The defence 
 was that the promise was wifhin the statute, and void. The Supreme 
 Court does not pass upon the question. It decides in favor of the de- 
 fendant, on the ground that the tavern-keeper had no lien. But it 
 does not say that if he had had a lien the promise would have been 
 good. According to the English cases, and the best-considered Amer- 
 ican cases, it would have been within the statute. According to the 
 dissenting opinion in Mallory v. Gillett, the oral promise would have 
 been good. But we think that the cases in which it has been held that 
 the statute does not apply where a creditor holds security for his debt, 
 and surrenders it to the debtor upon the promise of a third person to 
 be answerable .for the debt, arose upon the, misapprehension of the 
 facts of the case, and of the language of Lord Mansfield in Williams 
 v. Leper, 3 Burr. 1886, which was a case in which the security was 
 surrendered really to the party making the promise as trustee for cer- 
 tain creditors. Where the promisor gets the security into his hands, in 
 
Sec. 1) CONTRACTS OF GUARANTY 
 
 1389 
 
 a case of this kind, the case is universally held not td be within the 
 statute. Aiid in Vermont it is said, in Fullam v. Adams,quoted above, 
 tljat no case is sound where it has been held that an oral promise to 
 pay the debt of another is binding, unless the promisor held in his 
 hands property of the debtor devoted to the payment of the debt, and 
 his promise to pay attaches upon the obligation or duty growing out of 
 the receipt of such fund. 
 
 In Besshears v. Rowe, 46 Mo. 502, Rowe had sold real estate to 
 one Brown, subject to a judgment in favor of Besshears, and it was 
 agreed between the three men, before the sale, that plaintiff's judg- 
 ment should be released; that Brown should pay the purchase-money, 
 less the judgment, and should pay the judgment directly to plaintiff. 
 The agreement was held not to be within the statute, because the debt 
 became by the agreement the debt of Rowe. It also ceased to be the 
 debt of Brown. This case was not only within the Massachueetts 
 rule, but within the more stringent one apf)rOved in Ki'ngsley v. Bal- 
 come. 
 
 In Barker v. Scudder, 56 Mo. 272, Barker sold to Scudder, and in 
 part payment took notes of Able, who was insolvent when his note ma- 
 tured. The purchaser guaranteed the notes. It was held that his 
 promise, though oral, was not within the statute. The principle in- 
 volved here runs through a great number of cases. It has always 
 been held that they are not within the intent of the law. The new 
 and distinct consideration, independent of the debt of the maker, mov- 
 ing directly to the promisor, and being itself the main transaction, 
 takes them out of the statute, within the meaning of Chancellor Kent's 
 exception as interpreted in Mallory v. Gillett and the Massachusetts 
 caSes cited above. In these cases the promise to pay the debt existing 
 to the promisor, and transferred to the promisee at the time the prom- 
 ise is made. The promise is not made to the party to whom the debt 
 is owing (Eastwood v. Kenyon, 11 Ad. & E. 438), and the considera- 
 tion originates in a new and independent dealing between the promisor 
 and the creditor, the undertaking to answer the debt of another being 
 a mere incident of the' transaction. As the note is transferred, the in- 
 •debtedness to the original creditor is gone, and he can look to the debt- 
 or merely as a surety for himself in case he has to take up the note 
 when due. The case comes within a well-known class of cases except- 
 ed from the operation of the statute, and noted in the third class of 
 exceptions in Mallory v. Gillett. The real substance of the promise 
 here is to pay an obligation of the party making it, though its pay- 
 ment results in the payment of the debt of another. "The rule,'' says 
 Judge Wagner (46 Mo. 503),, "rests on solid ground, that when one un- 
 dertakes to, pay the debt of another, and by the same act also pays his 
 own debt, which, was the motive of,, the promise, the undertaking is 
 not within the statute." 
 
1390 THE STATUTE OF FKAUDS (Ch. 10 
 
 In I Glenn v.; Lehnen, 54 Mo. 45, the court says that if plaintiff de- 
 livered the goods on the faith of defendant's promise to be responsible 
 as a surety for the purchaser, the promise is void unless in writing. 
 And in Holt v. DoUarhide, 61 Mo. 433, Rice executed a note to Mc- 
 Cloud, which; McCloud assigned to, plaintiff. Rice then sold a lot to 
 DoUarhide, and directed him to pay the purchase-money to plaintiff, 
 which DoUarhide agreed to do. The court says that defendant did 
 not by this assume to answer for the debt of another, but undertook 
 to pay his own debt. This is also clearly within the meaning of Chan- 
 cellor Kent's exception as interpreted both in Massachusetts and in 
 Mallory v. Gillett, and is one of a well-known class of cases held to 
 be outside of the statute; though it has been strenuously contended 
 that both such cases and that of which Barker v. Scudder, is an ex- 
 ample, and which are both manifestly , promises to pay the debt of an- 
 other in a merely formal sense, ought to be brought within the statute 
 as being within the scope and meaning of the law. 
 
 In the case at bar, the promise was to pay the debt of another. 
 Merrell was certainly not the bank. The promise was clearly collat- 
 eral. Merrell was to pay the deposit to plaintiff if the bank should 
 close ; the indebtedne,ss of the bank existed when the promise was made, 
 and still subsisted. Here was no distinctly new consideration mov- 
 ing directly to the proinisor, and substantial, so as to be a clearly suf- 
 ficient motive for the transaction. The main object was forbearance 
 to the bank an,d any benefit to the promisor was merely incidental. 
 It is true, defendant v/as an officer and shareholder of the bank, and 
 rnight be benefited by the action of plaintiff in leaving the deposit ; 
 but that is hot enough. A good illustration of the consideration which 
 takes the case out of the statute, as mailing the new contract the main 
 thing and the promise to pay the debt of another a mere incident," is 
 one of the earlier English cases, Tomlinson v. Gill, Amb. 330, cited 
 in Mallory v. Gillett. There, Gill promised the widow that if she 
 would allow him to administer he would pay all debts of the estate. 
 Hefe it was held that this was a promise to make the estate produce 
 the debts, in consideration of being allowed to administer. It was a 
 purchase of that privilege, and the debts of the estate became the debt 
 of Gill'. ' Or the case of- a factor who gets an increased commission 
 to insure collections or guarantee the sales. There, the factor gets 
 possession of the goods. His object in making, the agreement is not 
 the interest of the debtor at all. He makes an independent agreement^ 
 solely for his own benefit, that if the goods are delivered to him he will 
 be answerable for the price. 
 
 The case made by the petition, on the other hand, seems to be just 
 one of those which the statute was mainly designed to meet, where 
 words of recommendation or of encouragement to forbearance may be 
 exaggerated or misunderstood, and represented as positive contracts, 
 against the intention of the alleged guarantor, and where the law re- 
 
Sec. 1) CONTRACTS OF GUARANTY 
 
 1391 
 
 quires the most satisfactory evidence as to the precise language of 
 the promise. 
 
 The judgment of the Circuit Court is affirmed. All the judges con- 
 cur." 
 
 " In accord : Harburg India Rubber Co. v. Martin, [1902] 1 K. B. 778 ; 
 Trustees of Free Schools in Andover v. Flint, 13 Mete. (Mass.) 539 (1847) ; 
 Hurst Hardware Co. v. Goodman, 68 W. Va. 462, 69 S. E. 898, 32 L. R. A. (N. 
 S.) 598, Ann. Cas. 1912B, 218 (1910) ; Oarleton v. Floyd, Rounds & CO., 192 
 Mass. 204, 78 N. E. 126 (1906) ; First Nat. Bank v. Gaddis, 31 Wash. 596, 72 
 Pac. 460 (1903) ; Winne v. Mehrbaeh, 130 App. Div. 329, 114 N. Y. Supp. 618 
 (1909) ; Richardson Press v. Albright, 224 N. Y. 497, 121 N. E. 362, 8 A. L. 
 R. 1198, and note (1918). 
 
 A promise to pay tl|e debt of a third person to the promisee is not within 
 the statvTte, if the payment is to be out of funds of property of the third 
 person in the promisor's hands. Dock v. Boyd, 93 Pa. 92 (1880) ; Belknap 
 V. Bender, 75 N. Y. 446, 31 Am. Rep. 476 (1878) ; Fairbanks Morse & Oo. v. 
 Tafel, 159 Ky. 602, 167 S. W. 887 (1914) ; Cincinnati Traction Co. v. Cole, 
 258 Fed. 169 (1919) ; Armstrong v. First Nat. Bank (Mo. App.) 195 S. W. 562 
 (1919) ; First Nat Bank of Sing Sing v. Chalmers, 144 N. Y. 432, 39 N. E. 
 331 (1895). See Ames' Oases on Suretyship, 42. 
 
 Where the promisor receives a consideration of positive benefit to himself, 
 this constituting the actual moving cause of his promise, as well as the 
 conventional equivalent therefor, his promise is not within the statute, 
 even though performance thereof will also incidentally discharge the debt 
 of another. To determine "the actual moving cause" is no easier in the law 
 of contracts than In the law of torts. In the following cases the promise was 
 held to create an independent duty, and not to be .'within the statute : Prime 
 V. Koehler, 77 N. Y. 91 (1879), grantee of mortgaged premises promises to 
 pay the mortgage if mortgagee will forbear to foreclose it ; Johnson v. Huf- 
 faKcr, 99 Kan. 466, 162 Pac. 1150, L. R. A. 1917D, 872 (1917), same; Manning 
 V. Anthony, 208 Mass. 399, 94 N. B. 466, 32 L. R. A. (N.,S.) 1179 (1911), same; 
 Raabe v. Squler, 148 N. Y. 81, 42 N. E. 516 (1895), owner of building prom- 
 ises to pay subcontractor if he will continue to furnish material to contractor 
 —but see contra Rand v. Mather, 11 Cush. (Mass.) 1, 59 Am. Dec. 131 (1853) ; 
 Clifford V. Luhring, 69 111. 401 (1873), same; Cincinnati Traction Co; v. Cole, 
 258 Fed. 169, 169 C. C. A. 237 (1919), same; Bennington Lumber Co. v. Atta- 
 way, 58 Okl. 229, 158 Pac. 566 (1916), same; Wells & Morris v. Brown, 67 
 Wash.' 351, 121 Pac. 828, Ann. Cas. 1913D, 317 (1912), same; Davis v. Patrick, 
 141 U. S. 479, 12 Sup. Ct. 58, 35 L. Ed. 826 (1891), promise to pay- for past 
 services rendered for another as part compensation for future service to the 
 pg^misor; Outtill v. Harrington, 185 Iowa, 537, 170 N. W. 778 (1919), same 
 
 -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. 
 Kopnel. 5 Hill (N. Y.) 458 (1843) ; Swan v. Nesmith, 7 Pick. (Mass.) 220, 
 19 Am. Dec. 282 (1828) ; Davys v. Euswell, [1913] 2 K. B. 47; Couturier 
 v. Hastie, 8 Ex. 40 (1852). ., .,. v ^ * 
 
 A contract to insure an employer against loss from the dishonesty ot 
 employees is not taken out of the statute by the fact that a premium is paid. 
 Commonwealth v. Hihson, 143 Ky. 428, 136 S. W. 912, L.,R.rA. 1917B 139, 
 Ann. Cas. 1912D, 291 (1911). Contra: Quinn-ShepherdsonOo.^v United 
 States Fidelity & Guaranty Co., ,142 Minn. 428, 172 N. W. 693 (1919). 
 
1392 THE STATUTE OF FRAUDS (Ch. 10 
 
 SMITH V. MOTT. 
 (Supreme Court of California, 1S88. 76 Cil. 171, 18'Pac. 260.) 
 
 Replevin by George G. Smith to recover a piano pledged by his wife 
 for a loan to hereof $200' from defendant, J. H. Mott. Judgment for 
 defendant, and plaintiff appeals. ' i 
 
 Haynb, C. Replevin for 9. piano. The plaintiff ^was the owner of 
 the piano. His wife pledged it without his knowledge or consent, to 
 secure a loan to her from the defendant. When the plaintiff learned 
 of the whereabouts of the piano, he went to the defendant, and, after 
 being informed of the position of affairs, made af)arol promise to pay 
 the interest and storage within a few days and the principal in three or 
 four months, if the defendant would wait that time, which the defend- 
 ant agreed to do and did do. The court below sustained the validity 
 of the pledge on the theory that there was fi ratification. It is probably 
 not technically correct to speak of a "ratification" where the transac- 
 tion was by one who neither was nor assumed to be an agent, btit who 
 acted on her own account. And it, may be conceded that the parol 
 promise of the plaintiff to pay the debt was within the statute of frauds; 
 and void, so far as his personal liability to pay was concerned., See 
 Crooks V. Tully^ 50 Gal. 255. But we think that what occurred 
 amounted to an agreement between the parties that the property should 
 remain in pledge for the wife's debt. This agreement was collateral 
 to, and distinct from, the contract to pay, and was not required to be 
 in writing. Joiies, Pledges, § 5 ; Civil Code, § 2986. The property be- 
 ing already in possession of the defendant, no redelivery to him was 
 necessary. Jones, Pledges, § 36. And the agreement for forbearance 
 of the wife's debt was sufficient consideration. 1 Pars. Cont'. *443. 
 We therefore advise that the order denying the motion for new trial be 
 affirmed. 
 
 We concur. Belcher, C. C. ; FooTE, C. ^ 
 
 Per Curiam. For the reasons given in the foregoing opinion, ffie 
 order denying the motion for a new trial is affirmed.^" 
 
 1" In Thompson v. Hazelwood Savings & Trust Co., 234 Pa. 452, 83 Atl. 
 284 (1912), the plaintiff deposited $10,000 with the defendant and agreed 
 in consideration of the defendant's renewing the note of a third person not 
 to withdraw the deposit until the note should be paid. This was held to 
 be a pledge of the money as collateral, executed by the actual deposit, and 
 not within the statute of frauds. C<ontra : Jones v. Citizens' State Bank, 103 
 Kan. 2S)7, 173 Pac. 977 (1918). 
 
Sec. 1) 
 
 CONTRACTS OF GUARANTY ^393 
 
 RIBOCK V. CANNER et al. 
 (Supreme Judicial Court of Massachusetts, 1914. 218 Mass. 5, 105 N. E. 462.) 
 
 Action by Israel Ribock against Carl Canner and another.' There 
 was a verdict for plaintiff, and defendants excepted. Exceptions sus- 
 tained, and judgment entered for defendants. , 
 
 Sheldon, J. The plaintiff had begun to do work upon three houses 
 which Hoffman and Pottick (hereinafter called the builders) were 
 erecting in Chelsea ; and for this work the builders by a written con- 
 tract had promised to pay the plaintiff the sum of $5,150. The de- 
 fendants had taken from the builders a construction mortgage upon 
 the property for more than $13,000, which sum they were to advance 
 to the builders in installments as the work progressed. When only 
 a small part of his work had been done, the plaintiff became suspicious 
 of the financial responsibility of the builders, and refused to go on un- 
 less they would give him a written order upon the defendants to pay 
 him for his work out of the advances to be made by the defendants on 
 the mortgage. The builders gave him such an order, and he presented 
 it to the defendant Canner for acceptance. Canner refused to accept 
 the order, but in substance, according to the testimony of the plaintiff, 
 which must have been followed by the jury, told the plaintiff "to go 
 ahead with the job" and he would pay him the money ; that the plain- 
 tiff should have "nothing to do with them builders," but that, when- 
 ever the plaintiff was "ready by his paper" to come up with a notice, 
 and he would give the plaintiff a check. This plainly meant that when 
 money became due to the plaintiff by his contract with the builders, 
 Canner would pay him whatever was so due. There was not by any 
 fair construction of the language used a new and independent agree- 
 ment between Canner and the plaintiff that the plaintiff should go on 
 and do the work upon Canner's credit and that Canner should pay 
 for it, as in Abbott v. Doane, 163 Mass. 433, 40 N. E. 197, 34 L. R. A. 
 33, 47 Am. St. Rep. 465, and other cases relied on by the plaintiff. On 
 the contrary, the contract between the plaintiff and the builders re- 
 mained in full force ; the amounts to become due to the plaintiff were 
 fixed' by that contract ; and the liability of the builders to the plaintiff 
 was wholly unaffected. Canner's promise was merely a verbal prom- 
 ise to pay to the plaintiff what should become due to him from the 
 builders, and as such came within the statute of frauds. R. L., c. 74, 
 § 1, cl. 2. That defense was set up in the answer. It was a bar to any 
 action upon the promise, even though it could be found that there was 
 a valuable consideration therefor. Tileston v. Nettleton, 6 Pick. 509 ; 
 Loomis V. Newhall, 15 Pick. 159, 169; Ames v. Foster, 106 Mass. 400, 
 8 Am. Rep. 343 ; O'Connell v. Mt. Holyoke College, 174 Mass.- 511, 
 513, 55 N. E. 460; Miles v. DriscoU, 201 Mass. 318, 87 N. E. 579. 
 The payments made afterwards from time to time by Canner to the 
 
 COEBIN CONT. 88 
 
1394: THE STATUTE OF PEAUDS (Ch. 10 
 
 plaintiff in part performance of his verbal promise have no bearing 
 upon this question. 
 
 As Canner's promise will not support any action, we need not con- 
 sider whether the other defendant in any event could have been held 
 thereon. 
 
 The case appears tq have been fully tried. • It comes within the terms 
 of St., 1909, c. 236. The defendants' exceptions must be sustained, and 
 judgment must be entered in their favor. 
 
 So ordered. 
 
 SECTION 2.^CONTRACTS IN CONSIDERATION OF MAR^ 
 
 RIAGE 
 
 DIENST V. DIENST. 
 
 (Supreme Court of Michigan, 1913. 175 Mich. 724, 141 N. W. 591.) 
 
 Action by Anna Emily Josephine Jannasch Shortt Dienst against 
 Andrew Dienst; From an order and decree sustaining a demurrer to 
 defendant's cross-bill, he appeals. Affirmed. 
 
 McAlvay, J.^^ Complainant filed her bill of complaint against de- 
 fendant, praying for divorce on the ground of extreme cruelty. De- 
 fendant appeared and filed an answer to said bill of complaint, coupled 
 with a cross-bill, wherein he set up a verbal antenuptial contract, by 
 which it is claimed that she agreed to make provision tbr him- after 
 the marriage by executing a will of all her property in his favor in 
 case he survived her. The relief prayed for in said cross-bill is that 
 complainant produce and file such will, which is claimed to have been 
 made soon after the marriage, and that it be declared binding as a set- 
 tlement of the property rights of the parties; that in case the will has 
 been destroyed by her she be required to make and execute a duplicate 
 thereof ; that in case she refuses so to do within the period of five days 
 after decree, the decree stand in the place and stead of said will and be 
 final ; that the rights and interest of defendant in said property be de- 
 clared fixed, binding, and vested; that complainant be enjoined from 
 disposing of any of her property except in accordance with the agree- 
 ment claimed, and for general relief. He does not pray for a decree 
 of divorce. Issue was joined by a replication to the answer. 
 
 A general demurrer was interposed by complainant to the cross-bill 
 of defendant on the ground of want of equit}' for several reasons, the 
 chief of -which was that the claimed antenuptial contract was within 
 the statute of frauds. This provision of the statute reads: "Every 
 
 11 Part of the opinion is omitted. 
 
Sec 2 ^ 
 
 ■^) CONTRACTS m CONSIDERATION OF MARRIAGE 1395 
 
 agreement, promise or undertaking, made upon consideration of mar- 
 riage, except the mutual promises to many, shall be void unless such 
 agreement, contract or promise, or some note or memorandum thereof, 
 be in writing, sigried by the party to be charged therewith." Section 
 9515, subd. 3, C. L,. 1897. * * * 
 
 A very brief statement of the circumstances wliich brought about 
 the marriage between these parties will be made. It appears that in 
 iNovember, 1908, a correspondence between them was begun, the initial 
 letter having been written by complainant. Both were subscribers to 
 the publication of a marriage brokerage called "The Correspondent," 
 in which complainant discovered an attractive description of defend- 
 ant. Complainant was of the age of 62 years and defendant 66 years. 
 Both had been previously married, and each had been widowed by 
 death. She was possessed of an estate, real and personal, in her own 
 right, of between sixty and seventy thousand dollars. Dfefendant was 
 penniless. A liirid correspondence, thus begun between the parties, 
 of which we are furnished only that of complainant, appears as ex- 
 hibits to his cross-bill (he modestly withholding his contributions to the 
 sarne), and within a few months culminated in their engagement, 
 which was speedily followed by a marriage, growing out of which this 
 litigation, to sever the marital relations between them, naturally fol- 
 lowed. 
 
 Counsel for defendant apparently appreciates and admits that if 
 the agreement sought to be enforced was made and entered into upon 
 consideration of marriage, not having been reduced to writing, it is 
 void under the statute of frauds. However, he contends that the 
 agreement relied upon by him was "not made upon consideration 
 of marriage"; that the agreement was that if defendant would 
 give up his home and employment and abandon prospective political 
 preferment, come to Kalamazoo, marry, and reside with complain- 
 ant and not return to Kansas, she would not only support him, 
 but would make a will as already stated. It appears, however, 
 that the only agreement which defendant charges in his cross-bill 
 was entered into by complainant, and which he avers he relied 
 upon, is the agreement set forth in the excerpt from his cross-bill above 
 quoted, to the efifect that she "then and there, as a further considera- 
 tion for the consummation of such engagement of marriage promised 
 and agreed that she would, immediately after their said marriage, 
 make such provision that the said defendant would come into posses- 
 sion and ownership of all of her said property upon her death." That 
 this was the inducement appears from his averment as follows : "And 
 that thereupon immediately thereafter, relying upon such) representa- 
 tions, promises, and agreements on the part of the said plaintiff, and 
 in consideration thereof, he gave up and abandoned his employment, 
 position, and prospects, * * * which he then and there had, and 
 immediately proposed marriage to the said complainant," which pro- 
 
1396 THE STATUTE OF FRAUDS (Ch. 10 
 
 posal complainant immediately accepted. It is clear to us that this 
 claimed agreement and undertaking between these parties was made 
 upon consideration of marriage, and was within the prohibition of the 
 statute of frauds. It was therefore void and not enforceable. 
 
 The other questions discussed in the briefs of the parties do not re- 
 quire consideration. 
 
 The order and decree of the circuit court in sustaining the demurrer 
 of complainant is affirmed, and the cross-bill is dismissed, with costs 
 of both courts to complainant. The cause will be remanded, and will 
 proceed in due course.^* 
 
 MALLORY'S ADM'R v. MALLORY'S ADM'R et al. 
 (Court of Appeals of Kentucky, 1891. 92 Ky. 316, 17 S. W, 737,) 
 
 Action by C. L,. Mallory's administrator against A. W. Mallory's 
 administrator and others to recover personal property. Judgment for 
 defendants. Plaintiff appeals. Reversed. 
 
 Bennett, J.^' A. W. Mallory, the. appellee's intestate, was a 
 widower with children, and C. L. Mallory, the appellant's intestate, 
 was a widow with one child, a son. Both of these persons owned 
 property, and married each other. The husband, the appellee's in- 
 testate, died, and in a few days thereafter, and before the personal 
 property that the statute gives to the widow, and which is to be set 
 apart to her, was set apart, C. L. Mallory, wife of A. W. Mallory, and 
 the appellant's intestate, died. This suit was instituted by appellant's 
 administrator to recover of the appellee, as administrator, the value 
 of the said personal property, the same not having been set apart, 
 and was, or some of it, on hand at the death of A. W. Mallory, but 
 disposed of by the appellee. The contention of appellee is that, as 
 there was an antenuptial contract between C. L. and A. W. Mallory, 
 that entitled each to retain the title of his and" her property, and dis- 
 pose of the same as though no marriage had taken place, C. L. Mal- 
 lory was not entitled to the property that the statute directs to be set 
 
 12 In accord: Hunt v. Hunt, 171 N. Y. 396, 64 N. E. 159, 59 L. R. A. 306 
 (1902) ; White v. Bigelow, 154 Mass, 593, 28 N. E. 904 (1891) ; Richardson v. 
 Richardson, 148 111. 563, 86 N. E. 608, 26 L. R. A. 305 (1893) ; Lloyd v. Fulton, 
 91 U. S. 479, 23 L. Ed. 363 (1875) ; London v. G. L. Anderson Brass Works, 
 197 Ala. 16, 72 South. 359; Day v. Roby, 77 N. H. 144, 89 Atl. 305 (1913) ; 
 Barlow v. Barlow, 233 Mass. 468, 124 N. E. 285 (1919). 
 
 An engagement to marry is not within the statute as a contract in con- 
 sideration of marriage. Cogging v. Cannon. 112 S. C. 225, 99 S. E. 823 (1919) ; 
 Short V. Stotts, 58 Ind. 29 (1877) ; Blackburn v. Mann, 85 111. 222 (1877) ; 
 Harrison v. Cage, 1 Ld. Baym. 387 (1698). But if the promise to marry is by 
 its terms not to be performed within one year it is unenforceable. Derby 
 V. Phelps, 2 N. H. 515 (1822) ; Paris v. Strong, 51 Ind. 339 (1875) ; Barge v. 
 Haslam, 63 Neb. 296, 88 N. W. 516 (1901) ; Lawrence v. Cooke, 56 Me. 187, 
 06 Am. Dec. 443 (1868). Contra: Brick v. Gunnar, 36 Hun (N. Y.) 52 
 (1885),; Lewis v. Tapman, 90 Md. 294, 45 Atl. 459, 47 L. R. A. 385 (1900). 
 
 1' Part of the opinion is omitted. 
 
Sec. 3) CONTRACTS FOR THE SALE OF LAND 
 
 1397 
 
 Apart to the widow upon the death of her husband. It is not alleged 
 that the antenuptial contract was in writing ; and as (Gen. St. 1888) 
 chapter 22, § 1, requires contracts in consideration of marriage to be 
 in writing, if the contract relied upon comes within said provision, it 
 was necessary to allege that the contract was in writing; and the 
 answer, because of not alleging that fact, is not sufficient. Besides, 
 the proof fails to show that the contract was in writing. Does the 
 alleged contract come within said provision ? It seems that the ques- 
 tion has been settled and put beyond dispute by this court in the case 
 of Potts V. Merrit, 14 B. Mon. 406. That case, like this, was a case 
 of verbal and antenuptial contract, and the Revised Statutes, then in 
 force, had the same provision, as to requiring the antenuptial contract 
 to be in writing, as the General Statutes, supra ; and this court held 
 that the contract was not enforceable, in law or in equity, unless it 
 was in writing. An antenuptial contract is one by which the parties 
 agree to anticipate the general law controlling the marital relation, 
 and make a law in that regard to suit themselves ; and consideration 
 for the contract is the agreement to marry each other, whick must be 
 consummated, else the consideration fails. So the contract' clearly 
 comes within the provision, supra, requiring contracts in considera- 
 tion of marriage to be in writing. If they are not in writing, no ac- 
 tion can be maintained on them, and, in a case like this, such contract 
 is no defense to an action by the widow or her representative to en- 
 force her marital rights. * * * 
 
 The judgment is reversed, and causp remanded for further proceed- 
 ings ^consistent with this opinion. 
 
 SECTION 3.— CONTRACTS FOR THE SALE OF LAND 
 
 ESTABROOK v. WILCOX. 
 
 (Supreme Judicial Court of Massachusetts, 1917. 226 Mass. 156, 115 N. 
 
 E. 2^3.) 
 
 Action by Francis S. Estabrook against William G. Wilcox. Judg- 
 ment for plaintiff, and defendant brings exceptions. Exceptions sus- 
 tained, and judgment directed to be entered for defendant. 
 
 LoRiNG, J. This is an action by which the plaintifiE seeks to recover 
 damages for breach of- an oral agreement to lay out and construct a 
 street on the defendant's land for the use of the plaintiff as grantee 
 in a deed executed by the defendant. The defense set up was the 
 statute of frauds. 
 
 The plaintiff relies upon Cole v. Hadley, 162 Mass. 579, 39 N. b.. 
 274, Drew v. Wiswall, 183 Mass. 554, 67 N. E. .666, and Durkm v. 
 
1398 THE STATUTE OF FEAUDS (Ch. 10 
 
 Cobleigh, 156 Mass. 108, 30 N. E. 474, 17 L. R. A. 270, 32 Am. St. 
 Rep. 436.. But in those cases the right to have a street laid out over 
 the defendant's land was created in writing. In those cases the deed 
 to the plaintiff referred to a plan to show the land conveyed and on 
 that plan a street was shown on which the premises conveyed abutted. 
 That is to say: in those cases the right to have a street laid out over 
 the defendant's land (that is to say the right to an easement over the 
 defendant's land) was created by an instrument in writing. In the 
 case at bar the only way in which the plaintiff undertook to make out 
 that he had an easement over the defendant's land was by the oral 
 contract. To this the fourth section of the statute of frauds (re- 
 enacted in this commonwealth m R. L. c. 74, § 1, cl. 4) is a defense. 
 Where the plaintiff makes out a right to a street over the defendant's 
 land by deed or by any other writing and then relies on a contract on 
 the defendant's part to do the physical work necessary to construct 
 the street and make the paper street into a real street he has a right 
 of action on that contract although that contract was made by word 
 of mouth. That was the point decided in the three eases on which the 
 plaintiff relies where the whole matter is fully explained. 
 
 It follows that the exceptions must be sustained. And we are ot 
 opinion that acting under St. 1909, c. 236, § 1, we should direct judg- 
 ment to be entered for the defendant. It is 
 
 So ordered.^* 
 
 HOUSTON V. FARLEY et al. 
 (Supreme Court of Georgia, 1917. 146 Ga. 822, 92 S. E. 635.) 
 
 Suit by W. R. Houston against L. F. Farley and others. Judgment 
 for defendants dismissing the petition on demurrer, and plaintiff 
 brings error. Affirmed. 
 
 W. R. Houston and L. F. Farley entered into a verbal contract that 
 Farley was to attend an administrator's sale and purchase thereat a 
 described lot of land if it should sell for less than $2,000, and, if the 
 land was purchased, to take title to himself and execute to Houston a 
 bond conditioned to make or cause to be made to him good and sufiE- 
 cient title to the property purchased upon his compliance with certain 
 conditions, namely, the payment in cash of the sum of $100 and the 
 giving of his notes to Farley for the balance due, as follows : $100 in 
 12 months, and the balance to become due two years from the date of 
 the contract of purchase ; the deferred payments bearing interest at the 
 rate of 8 per cent, per annum. The pi'operty was purchased by Farley 
 for $1,441, and the administrator made a deed to him. On the next 
 day, Houston tendered to Farley $100 in cash, and offered to deUver 
 
 1* Other easement eases are Heyman v. Biggs, 223 N. Y. 118, 119 N. E. 
 243 (1918) ; Popham v. Eggleston (Tex. Civ. App.) 193 S. W. 181 (1917) ; Cal- 
 lan V. Walters (Tex. Civ. App.) 190 S. W. 829 (1916). 
 
^^' ^) CONTRACTS FOR THE SALE OF LAND 1399 
 
 his promissory notes in accordance with the stipulations of the con- 
 
 Drooertv to ol A T'""'" \^"^ ^""^ '^*^"' ^<i thereafter sold the 
 
 'fhe fn7win Th f S^'' ""'^^ ^"' ^"^^^^ ^° have purchased with 
 
 he full knowledge of Houston's right. Upon tliese allegations Hous- 
 
 Sin^tT 77^ performance of the parol contract with Farley 
 
 ^Fvll P w ?''• ^^' '°"''' ^'^^"^'^^^^ the petition on demurrer^ 
 Evans, P. J. (after statmg the facts as above). A ground of the 
 demurrer raises th« point that the oral contract of which specific .per- 
 formance IS sought is within the statute of frauds. The plaintiff c 
 
 con- 
 
 tends that the statute does not apply to a case as alleged in the petition 
 He bases such contention on the dictum of the first headnote in the 
 case of Chastain v. Smith, 30 Ga. 96, that: "Where one person 
 agrees, as agent, to buy land for another as his principal, and does 
 buy It, but fakes the title m his o^yn name, this title in his hands stands 
 affected with a resulting trust for the benefit of the principal by op- 
 eration of law, and the case is not within the statute of frauds ; re- 
 sulting trusts being expressly excepted from the operation of the 
 statute." 
 
 In discussing this ruling, Bleckley, C. J., said in Roughton v. Raw- 
 Imgs, 88 Ga. 819, 16 S. E. 89: "But the facts in Chastain v. Smith 
 did not require the court to determine whether there was a resulting 
 trust or not. * * * Strike this fact out of the case, and there 
 would have been a very different question before the court from that 
 on which the decision could be upheld with this fact in it. The case 
 itself was decided correctly, but the reason suggested in the first head- 
 note is not applicable to the facts as a whole, nor sustainable." 
 
 There is a clear distinction between cases where equity will enforce 
 a trust at the instance of a principal against his agent who, being com- 
 missioned to buy a piece of property, does buy it and takes title in his 
 own name, and cases where a trust results solely by operation of law. 
 In the former case the agent will be compelled to transfer to the prin- 
 cipal the benefit of his contract, upon repayment of the purchase 
 money and necessary expenses. Forlaw v. Augusta Naval Stores Co., 
 124 Ga. 261, 52 S. E. 898 (6). A resulting trust which arises solely 
 from the payment of the purchase price is not created unless the pur- 
 chase money is paid either before or at the time of the purchase. Hall 
 V. Edwards, 140 Ga. 765, 79 S. E. 852. When tlie person who sets up 
 a resulting trust has in fact paid no part of the purchase money, he 
 will not be allowed, under the statute of frauds, to show by parol that 
 the purchase was made for his benefit. No resulting trust can arise 
 from the payment of money after the purchase has been completed. 
 The plaintiff is not contending that the defendant was to purchase the 
 property in the plaintiff's name, but that the defendant, having pur- 
 chased the land, would sell it to him on credit according to stipulated 
 terms. Such a contract is within the statute of frauds, which re-- 
 quires every contract for the sale of lands or a;ny interest in or con- 
 
1400 THE STATUTE OF FEAUDS (Ch. 10 
 
 cerning them to be m writing and aigned by the party to be charged 
 therewith or some person by him duly authorized. Nor is such con- 
 tract, under the allegations of the petition, enforceable on the doctrine 
 of trust, or on the ground of fraud and part performance. Roughton 
 V. Rawhngs, supra; Lyons v. Bass, 108 Ga. 573,, 34 S. E. 721. 
 Judgment affirmed. All the Justices concur. 
 
 HIRTH V. GRAHAM. 
 
 (Supreme C!ourt of Ohio, 18&3. 50 Ohio St. 57, 33 N. E. 90, 19 Ii. R. A. 721, 
 40 Am. St. Bep. 641.) 
 
 Action for breach of contract by one Hirth against one Graham. 
 Plaintiff recovered a judgment before a justice of the peace of Mor- 
 row county, which, upon error being brought to the, court -of common 
 pleas,, was affirmed. The case was then taken on error to the circuit 
 court, where the judgments of the court of common pleas and of the 
 justice were both reversed, and plaintiff brings error. Affirmed. 
 
 Bradbury, J." The plaintiff in error brought an action before a 
 justice of the peace to recover of the defendant in error damages al- 
 leged to have been sustained on account of the refusal of the latter to 
 perform a contract by which he had sold to the plaintiff in error cer- 
 tain growing timber. The defendant attempted to secure the dismissal 
 of the action, on the ground that the justice had no jurisdiction of an 
 action for the breach of such a contract. Failing in this, and the action 
 being tried to a jury, he requested the justice to instruct the jury 
 "that if they find from the evidence that the trees about which this 
 action is brought were at the time of said alleged contract tlien grow- 
 ing upon the land of defendant, and that no note or contract or mem- 
 orandum was made of the contract of sale was at the time made 
 in writing, the plaintiff cannot maintain this action,. and your verdict 
 should be for the defendant," which instruction the justice refused 
 to give, but on the contrary gave to them the following instructions on 
 the subject : "This is an action for damage, not on the contract, nor 
 to enforce the same ; and if you find that a contract was made verbal 
 or otherwise and the defendant refused or failed to comply with its 
 terms, the plaintiff is entitled to any damage you may find him to have 
 sustained by way of such noncompliance." The defendant in error who 
 was also the defendant in the justice's* court, excepted, both to the 
 charge as given and to the refusal to' charge as requested; the verdict 
 and judgment being against him, he embodied the charge as, given, as 
 well as that refused, in separate bills of exceptions, and brought the 
 cause to the court of common pleas on error, where the judgment of 
 the justice of the peace was affirmed. He thereupon brought error to 
 the circuit court, where the judgments of the court of common pleas 
 
 1° Part of the opinion is omitted. 
 
Sec. 3) 
 
 CONTRACTS FOR THE SALE OF LAND 1401 
 
 and that of the justice were both reversed, and it is to reverse this 
 judgment of the circuit court, and reinstate and affirm those of the 
 court of common pleas and justice of the peace, that this proceeding 
 is pending. * * * 
 
 Whether a sale of growing trees is the sale of an interest in or con- 
 cerning land has long been a much controverted subject in the courts 
 of England, as well as in the courts of the several states of the Union. 
 The question has been differently decided in different jurisdictions, and 
 by different courts, or at different times by the same court within the 
 same jurisdiction. The courts of England, particularly, have varied 
 widely in their holdings on the subject. Lord Mansfield held that 
 the sale of a crop of growing turnips was within this clause of the 
 statute. Emmerson v. Heelis, 2 Taunt. 38, following the case of 
 Waddingtoh v. Bristow, 2 Bos. & P. 452, where the sale of a crop of 
 growing hops was adjudged not to have been a sale of goods and chat- 
 tels merely. And in Crosby v. Wadsworth, 6 East. 602, the sale of 
 growing grass was held to be a contract for the sale of an interest in 
 or concerning land. Lord EUeriborough saying: "Upon the first of 
 these questions," (whether this purchase of the growing crop be a 
 contract or sale of lands, tenements, or hereditaments, or any interest 
 in or concerning them,) "I think that the agreement stated, conferring, 
 as it professes to do, an exclusive right to the vesture of the land 
 during a limited time and for given purposes, is a contract or sale of 
 an interest in, or at least an interest concerning lands." Id. 610. Aft- 
 erwards, in Teal v. Auty, 2 Brod. & B. 99, the court of common pleas 
 held a contract for the sale of growing poles was a sale of an interest 
 in or concerning lands. 
 
 Many decisions have been announced by the English courts since 
 the cases above noted were decided, the tendency of which has been 
 to greatly narrow the application of the fourth section of the statute 
 of frauds to crops, or timber, growing upon land. Crops planted 
 and raised annually by the hand of man are practically withdrawn from 
 its operation, while the sale of other crops, and in some instances grow- 
 ing timber, also, are withdrawn from the statute, where, in the con- 
 templation of the contracting parties, the subject of the contract is to 
 be treated as a chattel. The latest declaration of the English courts 
 upon this question is that of the common pleas division of the high 
 court of justice, in Marshall v. Green, 1 C. P. Div. 35, decided in 1875. 
 The syllabus reads : "A sale of growing timber to be taken away as 
 soon as possible by the purchaser is not a contract or sale of land, or 
 any interest therein, within the fourth section of the statute of frauds." 
 This decision was rendered by the three justices who constituted the 
 common pleas division of the high court of justice, Coleridge, C. J., 
 Brett and Grove, JJ., whose characters and attainments entitle it to 
 great weight ; yet, in view of the prior long period of unsettled pro- 
 fessional and judicial opinion in England upon the question, that the 
 court was not one of final resort, and that the decision has encoun- 
 
1402 THE STATUTE OF FRAUDS (Ch. 10 
 
 tered adverse criticism from high authority" (Benj. Sales [Ed. 1892] 
 § 126), it cannot be considered as finally settling the law of England on 
 this subject. The conflict among the American cases on the subject 
 cannot be wholly reconciled. In Massachusetts, Maine, Maryland, 
 Kentucky, and Connecticut sales of growing trees, to be presently 
 cut and removed by the vendee, are held not to be within the operation 
 of the fourth section of the statute of frauds. Claflin v. Carpenter, 4 
 Mete. (Mass.) 580, 38 Am. Dec. 381; Nettleton v. Sikes, 8 Mete. 
 (Mass.) 34; Bostwick v. Leach, 3 Day (Conn.) 476; Erskine v. Plum- 
 mer, 7 Me. (7 Greenl.) 447, 22 Am. Dec. 216; Cutler v. Pope, 13 Me. 
 377; Cain v. McGuire, 13 B. Mon. (Ky.) 340; Byassee v. Reese, 4 
 Mete. (Ky.) 372, 83 Am. Dec. 481 ; Smith v. Bryan, 5 Md. 141, 59 
 Am. Dec. 104. In none of these cases, except 4 Mete. (Ky.) 373, and in 
 13 B. Mon. 340, had the vendor attempted to repudiate the contract 
 before the vendee, had entered upon its execution, and the statement 
 of facts in those two cases do not speak clearly upon this point. In 
 the leading English case before cited, (Marshall v. Green, 1 C. P. 
 Div. 35,) the vendee had also entered upon the work of felling the 
 trees, and had sold some of their tops before the vendor countermand- 
 ed the sale. 
 
 These cases, therefore, cannot be regarded as directly holding that 
 a vendee, by parol, of growing timber to be presently felled and re- 
 moved, may not repudiate the contract before anything is done under 
 it ; and this was the situation in which the parties to the case now under 
 consideration stood when the contract was repudiated. Indeed, a 
 late case in Massachusetts, (Giles v. Simonds, 15 Gray, 441, 17 Am. 
 Dec. 373), holds that "the owner of land, who has made a verbal con- 
 tract for the sale of standing wood to be cut and severed from the free- 
 hold by the purchaser, may at any time revoke the license which he 
 thereby gives to the purchaser to enter his land to cut and carry away 
 the wood, so far as it relates to any wood not cut at the time of the 
 revocation." The courts of most of the American states, however, 
 that have considered the question, hold expressly that a sale of grow- 
 ing or standing timber is a contract concerning an interest in lands, 
 and within the fourth section of the statute of frauds. Green v. Arm- 
 strong, 62 Am. Dec. 68; 1 Denio (N. Y.) 550; Bishop v. Bishop, 11 N. 
 Y. 123 ; Westbrook v. Eager, 16 N. J. Law, 81 ; Buck v. Pickwell, 27 
 Vt. 157; Cool V. Lumber Co., 87 Ind. 531; Terrell v. Erazier, 79 
 Ind. 473; Owens v. Lewis, 46 Ind. 488, 15 Am. Rep. 295; Armstrong 
 V. Lawson, 73 Ind. 498; Jackson v. Evans, 44 Mich. 510, 7 N. W. 79; 
 Lyle V. Shinnebarger, 17 Mo. App. 66; Howe v. Batchelder, 49 N. 
 H. 204; Putney v. Day, 6 N. H. 430, 25 Am. Dec. 470; Bowers v. 
 Bowers, 95 Pa. 477; Daniels v. Bailey, 43 Wis. 566; Lillie v. Dunbar, 
 62 Wis. 198, 22 N. W. 467; Knox v. Haralson, 2 Tenn. Ch. 232. 
 
 The question is now, for the first time, before this court for determi- 
 nation; and we are at liberty to adopt that rule on the subject most 
 conformable to sound reason. In all its other relations to the affairs 
 
■^^' ^) CONTRACTS FOR THE SALE OF LAND 1403 
 
 unnn^vT-"^'"^ timber is regarded as an integral part of the land 
 
 rr.?.=I , ^^^^'- V^ "°' '"^^''* ^° l^^y ^"d sale upon execution 
 as chattel proper y; it descends with the land to the heir, snd passes 
 to the vendor with the soil. Jones v. Timmons, 21 Ohio St. 596. Coal 
 petroleum, building stone, and many other substances constituting 
 Integra^ parts of the land, have become articles of commerce, 2 
 easily detached and removed, and, when detached and removed, become 
 personal property, as well as fallen timber; but no case is found in 
 which_ It is suggested that sales of such substances, with a view to 
 their immediate removal, would not be within the statute Sales of 
 growing timber are as likely to become the subjects of fraud and per- 
 jury as are the other integral parts of the land, and the question wheth- 
 er such sale is a sale of an interest in or concerning lands should de- 
 pend not upon the intention of the parties, but upon the legal char- 
 acter of the subject of the contract, which, in the case of growing 
 timber, is that of realty. This rule has the additional merit of being 
 clear, simple, and of easy application, — qualities entitled to substan- 
 tial weight in choosing between conflicting principles. Whether cir- 
 cumstances of part performance might require a modification of this 
 rule is not before the court, and has not been considered. 
 Judgment afifirmed.^* 
 
 WETKOPSKY V. NEW HAVEN GAS LIGHT CO. 
 
 ( Supreme Court of Errors of Connecticut, 1914. 88 Conn. 1, 90 Atl. 30, Ann. 
 
 Cas. 1916D, 968.) 
 
 Action by Sylvester Wetkopsky against the New Haven Gas Light 
 Company. From a judgment as of nonsuit, plaintiff appeals. Judg- 
 ment set aside, and new trial ordered. 
 
 The complaint alleges that the defendant on March 27, 1912, beiiig 
 the owner of a dwelling house situated at No. 44 Mill street, in New 
 Haven, which it desired to dispose of and have removed, sold the same 
 
 1^ In accord: Green v. Armstrong, 1 Denio (N. Y.) 550 (1845) ; Oarnahan 
 V. TerraU Bros., 137 Ark. 407, 209 S. W. 64 (1919) ; La Plant v. Loveland, 
 142 Minn. 89, 170 N. W. 920 (1919) ; Johnson v. Broughton, 183 Ky. 628, 210 
 S. W. 455 (1919) ; Miller v. Smith, 202 Ala. 449, 80 South. 833; Baucom v. 
 Pioneer Land Co., 148 Ga. 633, 97 S. E. 671 (1918) ; Davis v. Harris, 178 
 N. C. 24, 100 S. B. Ill (1919). 
 
 Marshall v. Green, 1 C. P. D. 35 (1875), 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. See Williston, Sales, §§ 61-67, 
 Bennett, Sales of Standing^Trees, 8 Harv. L. Rev. 367. 
 
 Crops planted annually are treated as personalty. Northern v. , State ex 
 rel. Lathrop, 1 Ind. 113 (1848) ; Whitmarsh v. Walk-er, 1 Mete. (Mass.) 313 
 (1840) ; Pumer v. Piercy, 40 Md. 212, 17 Am. Rep. 591 (1874) ; Sainsbury v. 
 Matthews, 4 M. & W. 343 (1838). 
 
 A sale of growing grass, to be cut and removed by the buyer, was held 
 within section 4 of the statute in Carrington v. Roots, 2 M. & W. 248 (1837). 
 
1404 THE STATUTE OF FRAUDS (Ch. 10 
 
 to the plaintifif (who then owned a lot on the opposite side of the street 
 to which he intended to remove it), for a good and valuable consid- 
 eration then paid; that the defendant had knowledge of the purpose 
 for which the plaintiff purchased the house; and that the defendant 
 afterwards refused to permit the plaintiff to remove or take posses- 
 sion of the house or to dehver the same to him. The answer denied 
 the allegation that the defendant sold the house to the plaintiff or had 
 knowledge that he intended to remove it across the street to his lot, 
 admitted that the defendant owned the house and the land upon which 
 it stood, and alleged that, being about to construct a tank upon the 
 lot, and it being necessary to the progress of such work that the house 
 should be removed from the lot not later than April 2d, the defendant 
 agreed with the plaintiff on March 27th that for the sum of $40, 
 which was then paid by the plaintiff, he might have the materials of 
 which the house was constructed, if he would tear it down and en- 
 tirely remove the materials from the premises on or before the night 
 of April 2d and that on the following day the plaintiff repudiated this 
 agreement and told the defendant that he did not intend to tear down 
 the house and would hot do so, but intended to remove it in its entirety, 
 and that the defendant thereupon, after the plaintiff had again stated 
 that he would not tear down the house, tendered him back the $40 and 
 notified him that the agreement was rescinded, and the defendant 
 afterwards tore down the house and removed the materials. The 
 reply denied the allegations that there was an agreement to tear down 
 the house. 
 
 Upon the trial the plaintiff introduced in evidence two writings 
 which read as follows : 
 
 "March 27, 1912. Received of Sylvester Wetkopsky five dollars, de- 
 posit on house No. 44 Mill St. Balance of $35'"'/ioo to be paid on or 
 before April 1, 1912.- New Haven Gas Light Company, J. B. Byrne." 
 
 "3:30 p. m., March 27, 1912. Received of Sylvester Wetkopsky 
 thirty-five dollars, balance on house No. 44 Mill St. $35'"'/ioo. New 
 Haven Gas Light Company, J. B. Byrne." 
 
 He also offered to prove by parol evidence the terms of the con- 
 tract between the parties. This evidence, upon objection that the con- 
 tract was within the statute of frauds, was excluded. The appeal as- 
 signs as error the action of the court in excluding this evidence, in 
 holding that the above writings were not sufficient memoranda to sat- 
 isfy the statute of frauds, and in holding that the contract alleged was 
 within the statute. 
 
 Thayer, J. The only question which has been argued before us in 
 this case is whether, under the allegations of the complaint, the plain- 
 tiff could prove a parol contract for the sale of the dwelling house 
 therein described. 
 
 The defendant's counsel in their brief have suggested,, without 
 seriously urging the matter that the complaint treats the contract as 
 
Sec. 3) CONTRACTS FOR THE SALE OF LAND 1405 
 
 one of purchase and sale. We think that it may also be construed as 
 alleging a contract to sell and a breach of the contract by the defend- 
 ant ; the subject-matter bemg a dwelling house. The complaint de- 
 scribes the dwelling house as "situated at No. 44 Mill street," and it 
 appears from the finding that the plaintiff offered evidence tending 
 to prove that it was a two-story, seven-room house "on a lot of the 
 defendant" across the street from a lot belonging to the plaintiff. It 
 does not appear, either in allegation or proof, that the house was per- 
 manently attached to the realty, or that it was not so detached from it 
 as to be a mere chattel. But it appears from the finding that the trial 
 court in making its rulings assumed that the house was attached to 
 the soil, and in this court both parties have argued the case upon 
 the same assumption. We shall assume, therefore, that it was, at the 
 time of the alleged contract, attached to the real estate in the manner 
 in which such dwelling houses are ordinarily affixed to the soil and 
 belonged to the defendant as the owner of the soil. 
 
 The plaintiff claims that the sale of a house to be immediately re- 
 moved from the land on which it stands, and to which it is affixed, is a 
 sale of personal property, and not of an interest in real estate, and so is 
 not within the section of the statute of frauds which prevents the main- 
 tenance of an action upon agreements for the sale of real estate, unless 
 the same shall be in writing. 
 
 Browne, in his first edition, after reviewing the early cases relating 
 to this section of the statute as bearing upon sales of fixtures, build- 
 ings, standing trees, growing crops, etc., attached to the soil, drew 
 therefrom the general rule that : "If the contract when executed is to 
 convey to the purchaser a mere chattel,, though it may be in the interim 
 a part of the realty, it is not affected by the statute." Browne, Stat- 
 ute of Frauds (1st Ed.) § 249. Benjamin, after quoting with approval 
 the language of Lord Blackburn, from his work on Sales, lays down the 
 rule: "that an agreement to transfer the property in anything attached 
 to the soil at the time of the agreement, but which is to be severed 
 from the soil cmd converted into goods before .the property is trans- 
 ferred to the purchaser, is an agreement for the sale of goods, an 
 executory agreement." Benjamin on Sales, vol. 1, § 133. Williston 
 says : "If the contract is to sell and deliver a house, even though the 
 house is, at the time, affixed to the realty, it is a contract for the sale 
 of goods, for the parties contract to buy and sell a house separated 
 from the realty and moved from its foundations. On the other hand, if 
 the parties attempt to make a present transfer of a building or mate- 
 rials fixed in a building, it is evident that they are attempting to make a 
 sale of realty, even though it is also agreed that the subject-matter of 
 the sale shall be severed in a short time." Williston.on Sales, § 66. 
 
 The Supreme Court of Massachusetts, speaking in a .case where the 
 contract related to growing trees, said: "It may be difficult in many 
 cases to determine, from the terms of the contract, whether the parties 
 
1406 THE STATUTE OF FRAUDS (Ch. 10 
 
 intend to grant a present estate in the trees while growing or only a 
 right, either definite or unlimited as to time, to enter and cut with title 
 to the property when it becomes a chattel. If the former be the true 
 construction, then it comes within the statute, and must be in writing ; 
 if the latter then, though wholly oral, it may be enforced." White v. 
 Foster, 102 Mass. 375, 378. There is great conflict in the decisions, 
 but this is the rule in England and in many of our sister states. Shaw 
 V. Carbrey, 95 Mass. (13 Allen) 462; Douglass v. Shumway, 79 Mass. 
 (13 Gray) 498, 502 ; Claflin v. Carpenter, 45 Mass. (4 Mete.) 580, 583, 
 38 Am. Dec. 381 ; Erskine v. Plummer, 7 Me. (7 Greenl.) 447, 451, 22 
 Am. Dec. 216; Davis v. Emery, 61 Me. 140,. 142, 14 Am. Rep. 553; 
 Banton v. Shorey, 77 Me. 48, 51 ; Fish v. Capwell, 18 R. I. 667, 670, 
 29 Atl. 840, 25 L. R. A. 159, 49 Am. St. Rep. 807 ; Sterling v. Baldwin, 
 42 Vt. 306, 311; Foster v. Mabe, 4 Ala. 402, 37. Am. Dec, 749; By- 
 assee v. Reese, 4 Mete. (Ky.) 372, 83 Am. Dec. 481 ; Leonard v. Med- 
 ford, 85 Md. 666, Z7 Atl. 365, 37 L. R. A. 449; Long v. White, 42 
 Ohio St. 59, 60; Slocum v. Seymour, 36 N. J. Law, 139, 141, 13 Am. 
 R^p. 432. This is the rule early adopted in this state. Bostwick v. 
 Leach, 3 Day, 476, 484. We think notwithstanding the numerous op- 
 posing authorities, that this is the better rule. 
 
 Counsel for the defendant attempted to distinguish cases of contract 
 to sell millstones or other fixtures attached to the realty and belong- 
 ing to the owner thereof, as was the case in Bostwick v. Leach, or a 
 case of contract to sell the boards and brick of which a building is 
 composed, where the vendee is to remove the millstones in the one 
 case and to tear down the building and remove the materials of which 
 it is constructed in the other, from a contract to sell an entire building 
 to be severed and removed by the vendee. We see no difference in 
 principle between the cases. The brick and materials of which a build- 
 ing is composed are, before the destruction of the building, a part of 
 the realty as much as the entire building is before its severance ; indeed, 
 they constitute the building. If a vendor contracts to sell a building en- 
 tire or to sell the materials of which it is composed and to sever the 
 building from the land or tear it down and deliver the materials, it will 
 hardly be claimed that in either case a sale of land or any interest there- 
 in is contemplated, or that an action could not be maintained for a 
 breach of the contract, because the intent of the parties in either case 
 to contract with respect to a mere chattel is apparent. 
 
 Where the intent to sell a building as a chattel is thus apparent from 
 the contract and circumstances attending it, the severance may be 
 made by the vendee. Mashall v. Green, L. R. 1 C. P. Div. 35, 40. The 
 fact that the vendee is to remove the building is important only as bear- 
 ing upon the intent of the parties in determining whether the title to 
 the building is- to pass at once or only after severance from the realty. 
 When the parties to the contract have in contemplation the sale of a 
 building or a tree as a cha.ttel, when it shall be detached from the land, 
 
Sec. 3) CONTRACTS FOR THE SALE OF LAND 14()7 
 
 there is no good reason why a court should not give effect to the con- 
 tract a-s the parties understood and intended it. In such a case neither 
 party intends that any interest in the real estate shall pass, The very 
 purpose of the contract may be to rid the land of such tree or building. 
 Until detached from the land, the thing contracted to be sold would re- 
 main a part of the realty, and a conveyance of the realty to a third 
 party would carry it to the purchaser. 
 
 The implied license to enter and sever the chattel^ if this was to be 
 done by the vendee, would be revoked by such conveyance of the land, 
 and the vendee's remedy must be against the vendor for breach of the 
 contract. 
 
 Growing crops, f ructus industriales, are an exception to the rule, and 
 may be sold and the title pass to the purchaser before severance from 
 the soil. 
 
 In the case before us the complaint alleges that the defendant owned 
 the dwelling house in question which it desired to have removed from 
 its lot, and that the plaintiff purchased it with the purpose of removing 
 it across the street to his own lot. The defendant denies this, and by 
 the answer alleges that the contract was that for the $40 paid the plain- 
 tiff was to have the materials of which the house was constructed if 
 he would tear down the house atid entirely remove the materials. This 
 is denied in the reply. As already intimated, we think that the allega- 
 tions of the complaint are sufficient to permit proof of an executory 
 contract for the sale of the house as well as a contract of bargain 
 and sale. The parties were at issue as to what the contract was; the 
 plaintiff claiming that it was for the sale of the house severed from the 
 land, the defendant that it was for the sale of the materials of which 
 the house was constructed if the plaintiff would tear it down and re- 
 move them. 
 
 The two receipts which were in evidence were not sufficient memo- 
 randa of any contract to satisfy the statute. They did not show any 
 sale, present or prospective of the house, and would apply as well to 
 money received on a lease as on a sale of the house. But the plain- 
 tiff was entitled to show that the contract was as he claimed for the sale 
 of the house as a chattel after severance from the soil, and there 
 was error in excluding the evidence offered for this purpose. 
 
 There is error; the judgment is set aside; and a new trial ordered. 
 All concur.^' 
 
 17 In accord- Long v. White, 42 Ohio St, 59 (1884). Contra, if title is 
 to mss before severance: Lavery v. Pursell, 39 Oh. D. 508 (1888). A sale 
 of tenant's fixtures is regarded as a sale of a mere "right to sever " and not 
 of an interest in land. Hallen v. Bunder, 1 Or., M. & R. 266 (1834) ; Lee 
 V. Gaskell, 1 Q. B. D. 700 (1876). See Williston, Sales, § 65. 
 
1408 THE STATUTE! OF FRAUDS (Ch. 10 
 
 ZWICKER V. GARDNER. 
 
 (Supreme Judicial Court of Massachusetts, 1912. 213 Mass. 95, 99 N. E. 
 949, 42 L. K. A. [N. S.] 1160.) 
 
 Action by Sam Zwicker against Edwin S. Gardner, executor. Find- 
 ing for plaintiff, and defendant brings exceptions. Exceptipns over- 
 ruled. 
 
 Morton, J. The plaintiff mortgaged certain premises to the de- 
 fendant. The defendant instituted foreclosure proceedings and the 
 plaintiff alleges that the defendant agreed that if he, the plaintiff, 
 would not bid at the foreclosure sale or procure other persons to bid, 
 he, the defendant, would bid the premises id and sell them at private 
 sale and pay over to the plaintiff any balance that remained after de- 
 ducting the mortgage, interest and expenses. The plaintiff alleges that 
 he refrained from bidding or procuring others to bid at the foreclosure 
 sale, and the defendant bid the prettiises in and afterwards' sold them 
 at private sale for a sum in excess of the mortgage, interest and' ex- 
 penses. This is an action to recover such excess. The case was sent 
 to an auditor, who found the facts to be as alleged by the plaintiff, and 
 was heard by the court without a jury upon the auditor's report. The 
 court ruled and found in favor of the plaintiff. The case is here on 
 exceptions by the defendant tO the refusal of the court to rule as re- 
 quested by the defendant that the contract was within the statute of 
 frauds and the plaintiff could not recover. It was agreed that the con- 
 tract, if there was one, was not in writing, arid' that there was no note 
 or memorandum thereof in writing signed by the defendant's testator, 
 or by any one by him thereunto lawfully authorized. 
 
 We think that the ruling and finding of the court were right. This 
 is not an action to enforce an oral contract for the sale of land or an 
 interest in or concerning the same. The land has been sold and noth- 
 ing remains to be done except for the defendant to account for and 
 pay over the excess. That part of the contract is separable from the 
 rest of the contract and the rest of the contract having been performed 
 there is no reason why this part of it should not be enforced. And to 
 that effect see the cases which we cite. Trowbridge v. Wetherbee, 11 
 Allen, 361; Graffam v. Pierce, 143 Mass. 386, 9 N. E. 819; Page v. 
 Monks, 5 Gray, 492. The case of Kennerson v. Nash, 208 Mass. 393, 
 94 N. E. 475, cited by the defendant, is entirely different from the 
 case before us. It is not necessary to consider whether, if the contract 
 did cOme within the statute of frauds, it would have been taken out 
 of the statute by part performance. , 
 
 Exceiptions overruled. 
 
Sec. 3) CONTRACTS FOR THE SALE OF LAND 
 
 1409 
 
 MAGUIRE V. KIESEL. 
 
 (Supreme Court of Errors of Cionnecticut, 1913. 86 Conn. 453, 85 Atl. 689.) 
 
 Action .by Charles F. Maguire against E. Kiesel to recover damages 
 for breach of an oral contract respecting real estate. Erom a judg- 
 ment for plaintiff assessing his damages, at $1,100, defendant appeals. 
 Affirmed. 
 
 The following facts are established by the finding of facts and the 
 finding of the issues in favor of the plaintiff : 
 
 About January 1,, 1911, the plaintiff and defendant entered into an 
 oral agreement to share equally in the profits that should be made 
 from the purchase of a lot of land, the building and rental of a house 
 thereon, and tlie sale thereof, if an opportunity to seU should be had. 
 No time limit was placed upon the continuation of the agreement, but 
 it might have been fully performed within one year. It was a part of 
 the agreement that the defendant should have the title of the land con- 
 ve)-ed to himself and the plaintiff jointly. Each party undertook to do 
 certain things to carry out the agreement and necessary to complete 
 the transaction. The plaintiff' agreed to pay one-half of the price of 
 the lot, to wit, $1,200, render or cause to be rendered certain services 
 in connection with the enterprise, and contribute $900 toward the cost 
 of erection of the building which was to cost $7,800. The defendant 
 was to contribute $600, in money toward, the purchase of the lot, his 
 services as bjtilder or contractor, and also $900 toward the cost of the 
 building, and, in addition, pay any excess in the cost of the building 
 over $7,800. The plaintiff performed or caused to be performed at his 
 expense the services which he undertook to render, and either did or 
 offered to do, and was at all times able and willing to do all the other 
 things required of him to be performed under the terms of the cout 
 tract. The defendant purchased the lot, taking title in his own name, 
 and paying the entire purchase price, although plaintiff stood ready 
 and willing to contribute his share tliereof . The same day he convey- 
 ed the property to his wife, in whose name it has stood ever since. 
 Thereafter the defendant stated to the plaintiff that he had procured 
 the monev for the purchase of the lot from his wife, and that, when 
 the building had proceeded, he would turn over the plaintiff's share 
 to him upon the plaintiff paying his share of the money. This ex- 
 ' planation satisfied the plaintiff. Thereafter, in pursuance of the part- 
 nership agreement between them, the plaintiff and defendant agreed to 
 erect a six- family house upon said lot. The defendant subsequently 
 refused to allow the plaintiff to contribute the $900 agreed upon, al- 
 though he offered to do so, and repudiated the agreement, and then and 
 ever since has refused to abide by it. A building was erected upon 
 the land by defendant, pursuant to and in substantial accordance with 
 the plans and specifications agreed to by the plaintiff, which was com- 
 
 COEBIN OONT 89 
 
1410 THE STATUTE OF FRAUDS (Ch. 10 
 
 pleted and ready for occupancy August 1, 1911. The rental .profit of 
 the building was estimated by the parties to be and in fact was at the 
 rate of $800 per year. The value of the property at the time of the 
 completion of the property was and remained $1,500 more than its cost. 
 The allegation of tfie complaint was that "the plaintiff entered into an 
 agreement by parol whereby they were to purchase real estate jointly 
 and construct a building thereon and to share in the profits arising 
 therefrom." 
 
 PeSnticE, J.^* (after stating the facts as above).' The plaintiff sues 
 to recover for damages alleged to have been suffered by him from the 
 breach of an agreement between himself and the defendant for the 
 conduct of a joint enterprise, and for sei-vices claimed to have been 
 rendered and, expenses inctirred by him in compliance with the temis 
 of the agreement and in aid of the joint undertaking, the benefit of 
 which has been appropriated by the defendant as a consequence of his 
 wrongful conduct in the breach of the agreement. The agreement 
 which is thus made the basis of recovery was an oral one, and is found 
 to have been one "to share equally in the profits that should be made 
 from the purchase of a lot of land, the building of a house thereon and 
 the sale thereof, if an opportunity to sell should be had." Four of the 
 reasons of appeal charge the trial court with error in the rendition of 
 its judgment upon the ground that the agreement was not actionable 
 by reason of two provisions of the statute of frauds. , In the brief 
 and argument- the only provision of the statute relied upon is that 
 which makes nonactionable any agreement not in writing "for the 
 sale of real estate or any interest in or concerning it." General Stat- 
 utes, § 1089. * * * 
 
 The agreement was not within the operation of the statute. The 
 statute "contemplates only a transfer of lands or some interest there- 
 m." Bostwick v. Leach, 3 Day, 476, 484 ; Hall v. Solomon, 61 Conn. 
 476, 483, 23 'Atl. 876, 29 Am. St. Rep. 218. The subject-matter of the 
 agreement was not land or any interest therein. It was a fund of 
 money representing profits from a joint enterprise in the nature of a 
 partnership. Bunnel v. Taintor, 4 Conn. 568, 573. This enterprise, to 
 be sure, was one which contemplated and involved a real estate trans- 
 action, and the fund to be divided was to be derived from that source. 
 But that touching which the agreement was made, and in which by rea- 
 son of the agreement the- plaintiff claims an interest, was the fund. 
 Bunnel v. Taintor, supra, presented a situation strikingly similar in its 
 details to the present, and having the same essential features, and we 
 there held that the contract was not within the statute, 4 Conn. 568, 
 573. The overwhelming weight of authority in other jurisdictions is 
 to the same effect, that an agreement for a joint enterprise in the na- 
 ture of a copartnership which has for its purpose the purchase, im- 
 
 18 Parts of the opinion are omitted. 
 
S^C- ^) CONTRACTS FOR THE SALE OF LAND 14H 
 
 provemeiit, and sale of real estate for the profit arising therefrom to 
 be divided among the joint undertakers as among partners, and which 
 does not undertake to operate upon the ownership of or title to the 
 realty, or anything annexed thereto as a part or parcel of it and trans- 
 ferable alone by deed, is not within the statute. Dale v. Hamilton, 5 
 Hare, 382; Chester v. Dickerson, 54 N. Y. 1, 8, 13 Am. Rep. 550; 
 Bates V. Babcock, 95 Cal. 479, 484, 30 Pac. 605, 16 L. R. A. 745, 29 
 Am. St. Rep. 133; Eaton v. Graham, 104 111. App. 296; Bruce v. 
 Hastings, 41 Vt. 380, 98 Am. Defc. 592; Richards v. Grinnell, 63 Iowa, 
 44, 54, 18 N. W. 668, 50 Am. Rep. 727; Fountain v. Menard, 53 
 Minn. 443, 445, 55 N. W. 601, 39 Am. St. Rep. 617; Jones v. Davies, 
 60 Kan. 309, 314, 56 Pac. 484, 72 Am. St. Rep. 354; Dudley v.. Little- 
 field, 21 Me. 418, 422; Howell v. Kelly, 149 Pa. 473, 475, 24 Atl. 
 224. * * * 19 
 
 LECOMTE et al. v. TOUDOUZE et al. 
 
 (Supreme Court of Texas,' 1801. 82 Tex. 208, 17 S. W. 1047, 27 Am. St. 
 
 Rep. 870.) 
 
 Fisher, J. (Section B).^" This is an action of trespass to try title 
 and for damages brought by appellants against appellees to recover 
 a strip of land lying between the farms of the parties ; and for rents 
 and profits, and damages for timber destroyed, in the sum of $650; 
 and praying for an injunction to stay waste, etc. * * * 
 
 This brings us to the consideration of the facts with reference to 
 the agreed boundary. Witness Locke, county surveyor of Bexar' coun- 
 ty, testifies that about March 21, 1884, Leon Lecomte, one of the 
 plaintiffs, requested him to run a division line between him. and Tou- 
 douze. He at first declined to do so, because, as he told Lecomte, 
 there had been a row between Lecomte and Toudouze, and they had 
 refused to let his deputy run tl^e line. Whereupon Lecomte replied 
 that they had agreed among themselves, and they sim,ply wanted 
 Locke, to go down and run the line, and handed to witness a note to 
 this effect from Toudouze. Locke went out in a few days to run the 
 line, and found Lecomte and Toudouze at the house ot the latter. 
 They stated to the witness that they had settled all their differences, 
 and had agreed on how he should run the line. They went out to 
 run the line, and he started to begin at a point lower down the river 
 than a certain pecan tree, whereupon Lecomte showed him a certain 
 
 i»In accord: Fitch v. King, 279 111. 62, 116 N. E. 624 (1917) ; Bird v. 
 Wilcox 104 Kan. 799, 180 Pac. 774 (1919) ; Hammel v. Feigh, 143 Minn. 11.5, 
 173 N 'w 570 (1919) ; Thompson v. Hurson, 201 Mich. 685, 167 N. W. 926 
 aOlS)'- Thompson v. McKee, 43 Okl.-243, 142 Pac. 755, L. E. A. 1915A, 521, 
 note (1914) ; Bates v. Babcock, 95 Cal. 479, 30 Pac. 605, 16 L. R. A. 745. 29 
 Am. St. 133 (1892). 
 
 2 Part of the opinion is omitted. 
 
1412' THE STATUTE OF FEADDS (Ch. 10 
 
 tree to commence from, and he ran from tfiat tree parallel with the 
 main line of the De Luna survey to where it intersected the Corpus 
 Christi road. To continue on this line would have taken some of 
 Lecomte's improvements. The parties then told him^ that they had 
 agreed to run around the improvements, and he: ran the line so as to 
 leave Lecomte his improvements. They all appeared to be perfectly 
 satisfied, and when he- set the last peg at the end of the line he asked 
 both Lecomte and Toudouze if they were satisfied with the line as 
 run, and they replied, "Yes." When the witness was surveying the 
 line the parties showed him where they agreed to put the line, and he 
 ran it as directed. 
 
 Witnesses De Heirnel and Neilly and defendant Gustave Toudouze 
 testified the same, in substance, as witness Locke as to thet agreed 
 line. Toudouze further testified that, a few days before Locke rnade 
 the survey, Octavia Lecomte, plaintiff, came to his house, and re- 
 quested him to go with her to her house, and have an agreement with 
 her husband and herself, settling all differences between them about 
 the boundary line. He agreed to go, andj as they walked along to her 
 house, they passed across the land in dispute, and she said : "Father, 
 we have determined to give you back your land, but you see we have 
 made' improvements on somp across the Corpus Christi road, and it 
 will be hard on us to lose them." "I told her we would run the line 
 froni the river until it reached the road, and then we would turn the 
 line along the road so as to leave them their improvements. She said 
 this was perfectly satisfactory, and thanked me for the concession. 
 When we arrived at the house we had a talk with Leon Lecomte, and 
 there agreed upon how the line should be ruii, without however, at 
 that time going over the line, and agreed that we would at once send ' 
 for Locke to come otit and survey and mark it out. I proposed to 
 send my son for him, and Lecomte said no, he would go, but that I 
 had also better send a note, so Locke would be sure to come. Le- 
 comte wrote the note for me, and carried it to Locke. In a few days 
 Locke came out and ran the line as testified to by him, so as to leave 
 the Lecomtes their improvements [as he and witness had agreed] 
 with them. Lecomte was along when the line was being run, and 
 agreed to it ; and they both expressed themselves as satisfied. In a 
 few days Lecomte moved his fence back from the land in dispute, and 
 put it along the Corpus Christi road on the line as surveyed by Locke, 
 to where the sufvey stopped." Witness at once built his fence along 
 the line agreed upon from the river to the Corpus Christi road. 
 While he was building the fence the plaintiffs were both at home, 
 and knew what was going on, and rnade no objection. 
 
 This agreement was made in March, 1884, and the fences remained 
 as they were put by the parties immediately after the agreement, and 
 it seems from the evidence, the land remained in possession of each 
 party, respectively, up to the fence. The suit was brought about 18 
 months after the agreement. 
 
Sec. 3) CONTRACTS FOR THE SALE OF LAND 1413 
 
 Appellants contend that this evidence is not sufficient to establish 
 an agreed boundary between the parties, because the land in con- 
 troversy is the separate property of Mrs. Lecomte, and that the hus- 
 band, Leon Lecomte, had no legal authority to make any agreement 
 with reference to the boundary that would conclude her, unless it is 
 shown that she acquiesced in the line agreed upon ; and contend that 
 the facts do not show an acquiescence upon her part in the line agreed 
 upon. Appellants also asked a charge to this effect, which was re- 
 fused. 
 
 ■ In our opinion, this presents the important question in the case. 
 It cannot be contended that the facts do not show an agreed boundary. 
 Because the facts in the record tending to establish such agreement 
 are more conclusive and certain in their force and effect than are 
 usually found in cases of this character, where the courts in passing 
 upon the question have repeatedly held the facts sufficient to prove the 
 agreed line. An oral agreement between adjoining owners establish- 
 ing a dividing line between their lands and a parol partition of lands 
 are held not to be prohibited by the statute of frauds, nor are they 
 within the meaning of the provisions of the law that regulate the 
 manner of conveying real estate. Aycock v. Kimbrough, 71 Tex. 333, 
 12 S. W. 71, 10 Am. St. Rep. 745 ; Wardlow v. Miller, 69 Tex. 398, 
 6 S. W. 292 ; Cooper v. Austin, 58 Tex. 496 ; Stuart v. Baker, 17 Tex. 
 420; George v. Thomas, 16 Tex. 89, 67 Am. Dec. 612; Houston v. 
 Sneed, 15 Tex. 309. The reason of this rule evidently is based upon 
 the idea that the parties do not undertake to acquire and pass the title 
 to real estate, as must be done by written contract or conveyance, 
 but they simply hy agreement fix and determine the situation and lo- 
 cation of the thing that they already own ; the purpose being simply 
 by something agreed upon to identify their several holdings, and 
 make certain that which they regarded as uncertain. 
 
 In ascertaining the effect of these parol agreements establishing 
 boundary lines, we do not understand that it is necessary," in order to 
 give the agreement vitality, that it should be supported by ac- 
 quiescence or acts from which an estoppel may spring. For, if the 
 agreement is made under circumstances free of facts that would au- 
 thorize a court of equity to set it aside, it must stand, although the 
 parties may have been mistaken in their behef that the line agreed 
 upon approximates the line of the survey where it is really found to 
 exist. Cooper v. Austin, 58 Tex. 496. 
 
 It is unnecessary for us in this case^ to express an opinion concern- 
 ing the validity and effect of a parol agreement made by the husband 
 alone, without the consent of the wife, as affecting her separate prop- 
 erty. ' Some of the cases previously cited seem to recognize his power 
 in this respect to so bind her. The evidence in this, case satisfies us 
 that the plaintiff Mrs. Lecomte was a party to the agreed boundary, 
 and fully understood its location, and expressed her consent to its 
 
1414 THE STATUTE OP FRAUDS (Ch. 10 
 
 establishment. The evidence of her father, Toudouze, connecting her 
 with the agreement, is not denied by her. 
 
 We report the case for afi&rmance. 
 
 Affirmed. ^^ 
 
 SECTION 4.— CONTRACTS NOT TO BE PERFORMED WITH- 
 IN ONE YEAR 
 
 PETER V. COMPTON. 
 
 (In the Court of King's Bench, 1694. Skin. 353, 90 Eng. Rep. 157.) 
 
 The question upon a trial before Holt, Chief Justice, at Nisi Prius, 
 in an action upon the case, upon an agreement, in which the defendant 
 promised for one guinea, to give the plaintiff so many at the day of 
 his marriage, was, if such agreement ought to be in writing, for the 
 marriage did not happen within a }'ear : the Chief Justice advised with 
 all the Judges, and by the great opinion (for there was diversity of 
 opinion, and his own was e contra) where the agreement is to be per- 
 formed upon a contingent, and it does not appear within the agree- 
 ment, that it is to be performed after the year, there a note in writing 
 is not necessary, for the contingent might happen within the year ; 
 but where it appears by the whole tenour of the agreement, that it is to 
 be performed after the year, there a note is necessary; otherwise not. 
 
 PETERS V. INHABITANTS OF WESTBOROUGH. 
 
 (Supreme Judicial Court of Massachusetts, 1837. 19 Pick. 364, 31 Am. 
 
 Dec. 142.) 
 
 Assumpsit for expenses incurred &c. in the support of Catharine 
 Ladds, from March 2d, 1835, until her death. 
 
 At the trial in the Common Pleas, before Strong, J., it appeared, that 
 
 21 In accord: Cavanaugli v. Jaclcson, 91 Cal. 580, 27 Pac. 931 (1891); 
 Grawunder v. Gotoskey (Tex. Civ. App.) 204 S. W. 705 (1918) ; Hose v. 
 Fletcher, 83 Wash. 623, 145 Pac. 989 (1915) ; Wood v. Bapp, 41 S. D. 195, 
 169 N. W. 518,(1918) ; Garvin v. Threlkeld, 173 Ky. 262, 190 S. W. 1092 
 (1917); Bordes v. Leece, 183 Ky. 146, 208 S. W. 780 (1919), prior to 
 actual occupation and acquiescence therein the oral contract may be re- 
 pudiated. 
 
 If there is no actual doubt as to the boundary, and the conscious purpose 
 is to convey a strip of land, the oral contract is invalid. Myrick v. Peet, 56 
 Mont. 13, 180 Pac. 574 (1919); Grawunder v. Gotowsky, supra; Standifer 
 V. Combs, 184 Ky. 708, 212 S. W. 921 (1919). 
 
 Oral partitions of land by tenants in common are validated by acquiescence 
 and actual occupation thereafter. McKnight v. Bell, 135 Pa. 358, 19 Atl. 
 1036 (1890). 
 
Sec. 4) CONTRACTS NOT TO BE PERFORMED WITHIN ONE YEAR 1415 
 
 the plaintiff was an inhabitant of Westborough ; that Catharine Ladds 
 was the daughter of John Ladds, who resided in a neighbouring town ; 
 that she came into the family of the plaintiff in March, 1834, when she 
 was eleven or twelve years of age, and remained there until her death, 
 which took place on the 31st of May, 1835, after a sickness of four 
 or five months; that, on the 2d of March, 1835, the plaintiff gave no- 
 tice of her illness to one of the overseers of the poor of Westborough, 
 and requested that she might be supported by the town ; but that no 
 action was taken by them on the subject. 
 
 The counsel of the defendants then proposed to show by parol evi- 
 dence, that a short time before Cathariiie went into the plaintiff's fam- 
 ily, it was agreed between him and her father, that the plaintiff should 
 take her into his family and employment, for one month, on trial, and 
 if, at the end of the month, he was not satisfied with her, he might re- 
 turn her to her father, but that, otherwise, he should support her un- 
 til she was eighteen years of age, and should not return her for any 
 cause but bad conduct on her part; that, in pursuance of this agree- 
 ment, she went into the family of the plaintiff, and that at the end of 
 the month the plaintiff expressed himself to be satisfied with her, and 
 never offered to return her to.her father. 
 
 The plaintiff objected to the introduction of this evidence, on the 
 ground that the contract, not being in writing, was void by the stat- 
 ute of frauds. 
 
 The judge ruled, that, as this contract was by parol, it was compe- 
 tent for the plaintiff to put an end to it at any time, and that, after the 
 notice given to the overseer on the 2d of March, 1835, the plaintiff 
 ceased to be liable for the support of the pauper; and the evidence 
 was accordingly rejected. 
 
 The jury returned a verdict for the plaintiff. The defendants ex- 
 cepted to the ruling of the judge. 
 
 Wilde,. J. This case depends on the question, whether the plain- 
 tiff was not, by his contract, as it was offered to be proved by the de- 
 fendants, bound to support the pauper, for the expenses of whose sup- 
 port the defendants are charged ; and we are of opinion that he was 
 so bound by his contract with the pauper's father. This was clearly 
 a valid contract, unless, being by parol, it was void by the statute of 
 frauds, as an agreement not to be performed within the space of one 
 year from the making thereof. St. 1788, c. 16, § 1. But this clause 
 of the statute extends only to such agreements as, by the express ap- 
 pointment of the parties, are not to be performed within a year. If an 
 agreement be capable of being performed within a year from the 
 making thereof, it is not within the statute, although it be not actual- 
 ly performed till after that period. 1 Com. on Contr. 86. On this con- 
 struction of the statute it was decided, in an anonymous case in 1 
 Salk 280 that a parol promise to pay so much money upon the return 
 of a* certain ship, was not within the statute, although the ship hap- 
 pened not to return within two years after the promise was made; 
 
1416 THE STATUTE OF FRAUDS - (Ch. 10 
 
 for that, by possibility, the ship might have returned within a year.. 
 So, in the case of Peter v. Cotopton, Skin. 353, it was decided that a 
 promise to pay money to the plaintiff on the day of his marriage, was 
 not within the statute, though the marriage did not happen within a 
 year. And it was held by a majority of the judges, that where an 
 agreement is to be performed upon a contingency, and it does not ap- 
 pear in the agreement, that it is to be performed after the year, there 
 a note in writing is not necessary; for the contingency might happen 
 within the year. 
 
 This construction of the statute is fully confirmed by the case of 
 Fenton v. Emblers, 3 Burr. 1278. In that case the defendant's tes- 
 tator had promised the plaintiff, that if she would become his hduse- 
 keeper, he would pay her wages after the rate of £6 per annum, and 
 give her, by his last will and testament, a legacy or annuity of il6 by 
 the year, to be paid yearly. The plaintiff, on this agreement, enter- 
 ed into the testator's service, and became his house-keeper, and contin- 
 ued so for more than three years. And the contract, though by parol, 
 was held to be valid and not with the statute. Mr. Justice Dennison 
 declaring his opinion to be, (in which Opinion the other judges coin- 
 cided,) that the statute of frauds plainly means an agreement not to 
 be performed within the space of a year, and expressly and specifical- 
 ly so agreed, that a contingency was not within it, nor any case that 
 depended on a contingency, and that it did not extend to- cases where 
 the thing might be performed within the year.: ' " • 
 
 But if it appears clearly, that an agreement is not to be performed 
 within a year, and that such is the understanding of the parties^ it is 
 within the statute of frauds, although it might be partly performed 
 within that period. Such was the decision in Boydell v. Drummond, 
 1 1 East, 142. But the performance of the agreement in that case did 
 not depend on the life of either party, or any other contingency. The 
 defendant had agreed to take and pay for a series of large prints from 
 some of the scenes in Shakspeare's plays. The whole were to be pub- 
 lished in numbers ; and one number, at least, was to be published an- 
 nually after the delivery of the first. The whole scope of the under- 
 taking shows, as Lord EUenborough remarks, that it was not to be per- 
 formed within a year; and if, contrary to all physical probability, it 
 could have been performed within that time, yet the whole work could 
 not have been obtruded upon the subscribers at once, so as to have en- 
 titled the publishers to demand payment of the whole subscription 
 from them within the year. 
 
 From these authorities it appears to be settled, that in order to bring 
 a parol agreement within the clause of the statute in question, it must 
 either have been expressly stipulated by the parties, or it must appear 
 to have been so understood by them, that the agreement was not to 
 be performed within a year. And this stipulation or understanding is 
 to be absolute and certain, and not to depend on any contingency. 
 And this we think is the clear meaning of the statute. 
 
Sec. 4) CONTRACTS NOT TO BE PERFORMED WITHIN ONE YEAR Ml? 
 
 In the present case, the performance of the plaintiff's agreement 
 with the -child's father, depended on the contingency of her life If 
 she had continued in the plaintiff's service, and he had supported her, 
 and she had died within a year after the making of the agreement, it 
 would have been fully performed. And an agreement by parol is not 
 within the statute, when by the happening of any contingency it might 
 be performed within a year. 
 
 Judgment of the Court of Common Pleas reversed, and a new trial 
 granted.^^ 
 
 DOYLE V. DIXON. 
 
 (Supreme Judicial Court of Massacliusetts, 1867. 97 Mass. 208, 93 Am 
 
 Dec. 80.) 
 
 Action by John Doyle against John Dixon for breach of a contract 
 by which the defendant, on selling his stock of groceries and good 
 will to the plaintiff, agreed not to go into the grocery business in Chi- 
 copee for a period of five years. The defendant contended that the 
 agreement was within the statute of frauds as an agreement not to be 
 performed within a year, and that, as it was not in writing, the plaintiff 
 could not recover; but the judge ruled the contrary. There was a ver- 
 dict for the plaintiff, and the defendant excepted. 
 
 Gray, J.^' It is well settled that an oral agreement which accord- 
 ing to the expression and contemplation of the parties may or may 
 not be fully performed within a year is not within that clause of the 
 statute of frauds, which requires any "agreement not to be performed 
 within one year from the making thereof" to be in writing in order 
 to maintain an action. An agreement therefore which will be com- 
 pletely performed according to its terms and intention if either party 
 should die within the year is not within the statute. Thus in Peters 
 v. Westborough, 19 Pick. 364, 31 Am. Dec. 142, it was held that an 
 agreement to support a child until a certain age at which the child 
 would not arrive for several years, was not within the statute, because 
 it depended upon the contingency of the child's life, and, if the child 
 should die within one year, would be fully performed. On the other 
 hand, if the agreement cannot be completely performed within a year, 
 the fact that it may be terminated, or further performance excused or 
 
 2 2 In accord: Myers v. Saltry, 163 Ky. 481, 173 S. W. 1138, Ann. Cas. 1916B, 
 1134 note (1915) ; Okin v. Selidor, 78 N. J. Law,- 54, 78 Atl. 770, 138 Am. 
 St Rep, 588, note (1909) ; Warner v. Texas & P. R. Co., 164 tl. S. 418, 17 
 Sup Ct 147 41 L. Ed. 495 (1896), contract to maintain a switch as long as 
 needed held Valid in an action for a breach IS years later; aine v. Southern 
 R Co., 110 S. 0. 534, 96 S. E. 532 (1918), to employ as long as work is 
 satisfactory; Harper v. Harper, 57 Ind. 547 (1877) ; Carr v. McCarthy, 70 
 S 258. 38 N. W 241 (1888); Kent v. Kent. 62 N. Y. 560, 20 Am. Rep. 502 
 (1875), contract to be performed at death; Riddle v. Backus, 38 Iowa, 81 
 (1874), same. 
 23 The statement of facts is rewritten and part of the opinion is omitted.: 
 
1418 THE STATUTE OF FRAUDS (Ch. 10 
 
 rendered impossible, by the death of the promisee or of another person 
 within a year, is not sufficient to take it out of the statute. It Was there- 
 fore held in Hill v. Hooper, 1 Gray, 131, that an agreement to employ a 
 boy for five years and to pay his father certain sums at stated periods 
 during that time was within the statute ; for although by the death of 
 the boy the services which were the consideration of the promise would 
 cease, and the promise therefore be determined, it would certainly not 
 be completely performed. So if the death of the promisor within the 
 year would merely prevent full performance of the agreement, . it is 
 within the statute; but if his death would leave the agreement com- 
 pletely performed and its purpose fully carried out, it is not. It has 
 accordingly been repeatedly held by this court that an agreement not 
 hereafter to carry on a certain business at a particular place was not 
 within the statute, because, being only a personal engagement to for- 
 bear doing certain acts, not stipulating for anything beyond the prom- 
 isor's life, and imposing no duties upon his legal representatives, it 
 would be fully performed if he died within the year. Lyon v. King, 
 11 Mete. 411, 45 Am. Dec. 219; Worthy v. Jones, 11 Gray, 168, 71 
 Am. Dec. 696. An agreement not to engage in a certain kind of busi- 
 ness at a particular place for a specified number of years is within the 
 •same principle ; for whether a man agrees not to do a thing for his 
 life, or never to do it, or only not to do it for a certain number of years, 
 it is in either form an agreement by which he does not promise that 
 anything shall be done after his death, and the performance of which 
 is therefore completed with his life. An agreement to do a thing for 
 a certain time may perhaps bind the promisor's representatives, and 
 at any rate is not performed if he dies within that time. But a mere 
 agreement that he will himself refrain from doing a certain thing- is 
 fully performed if he keeps it so long as he is capable of doing or 
 refraining. The agreement of the defendant not to go into business 
 again at Chicopee for five years was therefore not within the statute 
 of frauds. * * * 
 Exceptions overruled. 
 
 MRS. K. EDWARDS & SONS v. FARVE. 
 (Supreme Court of Mississippi, 1916. 110 Miss. 864, 71 South. 12.) 
 
 Action by Cameron Farve against Mrs. K. Edwards & Sons. From 
 verdict for the plaintiff, the defendants appeal. Reversed and re- 
 manded. 
 
 Smith, C. J. Appellee instituted this suit in the court below to re- 
 cover of appellants damages alleged to have been sustained by him be- 
 cause of the breach by appellants of a parol contract, by which, ac- 
 cording to his evidence, he agreed to deliver to appellants' mill all of 
 the logs which could be obtained from the timber on certain described 
 land, appellants agreeing to pay him therefor 35 cents per log, 200 logs, 
 neither more nor less, to be delivered each day, excluding Sundays, 
 
Sec. 4) CONTRACTS NOT TO BE PEEPORMBD WITHIN ONE THAR 1419 
 
 till the entire number thereof which could be obtained from the land 
 had been delivered. One of appellants' defenses is that the contract 
 was void under the statute of frauds, because it was "not to be per- 
 formed within the space of one year from the making thereof." In 
 support thereof, evidence was introduced by them to the efifect that 
 there were between 90,000 and 100,000 logs on the land. The evidence 
 for appellee was to the effect that the number of logs on the land was 
 between 40,000 and 50,000. 
 
 One of the instructions requested by appellants and refused by the 
 court was as follows : "The court instructs the jury for the defend- 
 ant that a suit cannot be maintained on any oral contract which is not to 
 be performed within the S^ace of one year from the making thereof, 
 and that therefore if the jury believed from the evidence that the 
 * number of logs to be handled could not be handled under the contract 
 at the rate of 200 per day within one year from the beginning of said 
 work they shall find for the defendant." 
 
 If the number of logs to be delivered under this contract amounted 
 to 90,000, the contract could not have been performed within one 
 year from the making thereof, for, since appellee could not be required 
 to deliver nor appellants to receive more than 200 logs per day, it 
 would have required 450 days to deliver them. 
 
 But it is said by counsel for appellee "that this contract, being person- 
 al, could and would terminate with the death of either individual," 
 which death might have occurred within the year, and therefore the 
 contract is not within the statute. Conceding for the sake of the argu- 
 ment that the death of either party to this contract would have ter- 
 minated it, it would certainly not thereby have been fully performed, 
 and the rule is that: "If the death of the promisor within the year 
 would merely prevent full performance of the agreement, it is within 
 the statute (Mallett v. Lewis, 61 Miss. 105); but if his death would 
 leave the agreement completely performed and its purpose fully car- 
 ried out, it is not." Jackson v. Railroad Company, 76 Miss. 607, 24 
 South. 874; Doyle v. Dixon, 97 Mass. 208, 93 Am. Dec. 80.^* 
 
 If the number of logs to be delivered amounted to 90,000, the 
 contract sued on is within the statute of frauds and the instruction 
 hereinbefore set out should have been given, for "the clause of the 
 statute in regard to agreements 'not to be performed within the space 
 of one year from the making thereof means to include any agreement 
 which, by a fair and reasonable interpretation of the terms used by the 
 parties, and in view of all the circumstances existing at the time, does 
 not admit of its performance, according to its language and inten- 
 tion, within a year from the time of its making." 2 Elliott on Con- 
 tracts, §§ 1277 and 1287. 
 Reversed and remanded. 
 
 2*1x1 accord: Hill v. Hooper, 1 Gray (Mass.) 131 (18";4), personal serv- 
 ice; Wahl V. Bamum, 116 N. Y. 87, 22 N. E. 280, 5 L. K. A. 623 (1889), 
 partnership. 
 
1420 THE STATUTE OF FRAUDS (Ch. 10 
 
 HANAU V. EHRLICH. 
 (Court of Appeal. [1911] 2 K. B. 1056.) 
 
 Fletcher Moulton, 1,. J.^° When the Legislature passes a stat- 1 
 ute, it is the duty of the Courts to interpret that statute and to. enforce 
 it. But in the case of statutes which were passed long ago there may 
 gradually accumulate a succession of decisions as to their interpretation 
 which may, and sometimes do, so bind later Courts that they cannot 
 treat the question as res integra but must accept the construction 
 already judicially determined, whether they approve of it or not. 
 There is no better example^than this ver*^ provision of section 4 of 
 the Statute of Frauds which requires a written memorandum of con- 
 tracts which are not to be performed within a year. In my opinion • 
 little is left of the statute. The Courts are bound by decisions which 
 they may well think to be out of harmony both with the spirit and the 
 letter of the enactment. For instance, in very early decisions the 
 Courts, influenced by the fear that the statute would Otherwise work 
 injustice, decided that a contract was to be performed within a year if 
 one of the contracting parties could perform. his part within a year. 
 The result is that a contract which obviously cannot be completely 
 performed within twenty years must be treated as a contract to be 
 performed within a year, if on one side it can be so performed. 
 
 A further question as to the meaning of a contract which is not to 
 be performed within a year arose soon after the passing of the stat- 
 ute. There are two possible lines of interpretation : the one tliat in 
 order to be outside the statute a contract must be such that it neces- 
 sarily must be performed within a year; the other, that it was suffi- 
 cient if it might be, or was capable of being, performed within that 
 time. The Courts have held that the latter view is the correct one. 
 In McGregor v. McGregor, 21 Q. B. D. 424, the Court of Appeal 
 gave what is in my judgment an authoritative interpretation of this 
 provision of the statute. In that case Ivindley and Bowen, L. JJ, (and 
 Lord Esher, M. R., does not differ from^ them), laid down clearly their 
 interpretation of the provision. A husband had there agreed to allow 
 "his wife a weekly sum for maintenance ; obviously the idea was that 
 it would continue for her life. The Court had to consider whether a 
 contract running with the Hfe of the wife was one which might be 
 wholly performed within a year, and Lindley, L- J-, said : "The effect 
 
 2 5 The concurring opinions of Vaughan Williams and Buckley, L. J J., are 
 omitted. Buckley, L. J., said: "It is now two centuries too late to ascertain 
 the meaning of section 4 by applying one's own mind independently to the 
 interpretation of its language. Our task is a much more humble one ; it is to 
 see how that section has been ecspounded in decisions and how the decisions 
 apply to the present case." 
 
 The decision was affirmed in the House of Lords, [1912] A. O. 39. In 
 accord; Wagniere v. Dunnell, 29 R. I. 580, 73 Atl. 309, 17 Ann. Cas. 205 
 (1909) ; Dobson v. OoUis, 1 H. & N. 81 (1856). Contra: Blake T. Voight, 
 134 N. 5C. 69, 31 N. E. 250, 30 Am. St. Bep. 622 (1892). 
 
Sec. 4) CONTRACTS NOT TO BE PERFORMED WITHIN ONE YEAR 1421 
 
 of these decisions is that, if the contract can by possibility be per- 
 formed within the year, the statute does not apply" ; while Bowen, L. 
 J., after saying that he approved of the decision in Peter v. Compton, 
 Skin. 353, proceeds thus : "It was held that 'an agreement that is not 
 to be performed within the space of one year from the making thereof 
 means in the Statute of Frauds an agreement which appears from its 
 terms to be incapable of performance within the year." The seal of 
 the Court of Appeal was thereby finally put on the interpretation that, 
 if a contract might under any possible circumstances be performed 
 within the year, it was not within the Statute of Frauds. We are 
 bound by this decision, although it takes all contracts of personal 
 service out of the Act, whatever be the term; of service and even 
 though the consideration is such that it cannot be performed within 
 the year. 
 
 Turning to the agreement in the present case, I find it to be an 
 agreement for two years, subject to a six months' notice on either 
 * * side which may be given at any time, and I ask myself whether it is 
 incapable of performance within the year, or whether, in the words of 
 Lindley, L. J., it can by possibility be performed within the year. If 
 I were free to answer that question, I should say that beyond all 
 question it might possibly be performed within the year. The, period 
 of two years has no higher contractual sanction than the effect of 
 the six months' notice, and such six months' notice may be given at 
 any time. It is impossible to predicate that the period of the per- 
 formance of this contract is more than a year. Moreover, suppiosing 
 the notice to be given, then six months after that date the contract 
 is wholly performed. There is no ghostly survival of the contract for 
 the remainder of the two years; the contract is wholly performed 
 when the notice has expired. I have, therefore, no hesitation in say- 
 ing that, if I were free to use my own intellect and must be guided by 
 the authoritative utterance of the Court of Appeal in McGregor v. 
 McGregor, 21 Q. B. D. 424, I should certainly allow this appeal; 
 but I am obliged to remember that, side by side with the decisions 
 which have led up to McGregor v. McGregor, 21 Q. B. D. 424, there 
 has been a parallel series of decisions which have dealt with one spe- 
 cial class of contract, one where a fixed period longer than a year has 
 been named in the contract not as a fixed period of the contract, but 
 only as the period during which the contract lasts in one alternative. 
 The only cases dealing with this point to which I need refer are Dob- 
 son v. Collis, 1 H. & N. 81, Ex parte Acraman, 31 h. J. (Ch.) 741, 
 and Lavalette v. Riches, 24 Times L. R. 336. In those decisions it 
 is laid down that where a contract specifies a fixed time for its per- 
 formance which is longer than a year, and contains what is called a 
 defeasance stipulation which might terminate the contract within the 
 vear, it is within the Statute of Frauds; that is to say, a contract like 
 the present one, which is for two years, subject to a power on either 
 ■=ide to give the six months' notice which terminates the period of the 
 
1422 THE STATUTE OF FRAUDS (Gh. 10 
 
 contract and limits the obligations of parties on either side, is never- 
 theless within the statute. I cannot reconcile those, decisions with 
 McGregor v. McGregor, 21 Q. B. D. 424, but I can apply both sets of 
 decisions, for I can say that in the smaller and more specific class 
 to which Dobson v. Collis, 1 H. & N. 81, applies there are decisions 
 which forbid me to apply the general test laid down in McGregor v. 
 McGregor, 21 Q. B. D. 424. I must obey both sets of decisions as 
 far as I can, and when I find a general rule laid down in the one 
 which is contrary to the specific rule laid down for the specific class 
 in the other, I am obliged to regard such decisions as that in Lavalette 
 V. Riches, 24 Times L. R. 336, as establishing an exception to the 
 general rule laid down in McGregor v. McGregor, 21 Q. B. D. 424, 
 which exception, although not noticed in .the last-named case, must 
 have been intended to be included, because there are co-ordinate de- 
 cisions which lay it down distinctly. I come to this conclusion with 
 regret. I cannot see why the fact that you mention a maximum term 
 to a contract, which only runs for that term if certain contractual 
 powers are not exercised by the parties, should be held to override the 
 contract to such an extent that, although it can be performed within 
 the year, it is my duty to say that it cannot. But I am bound by the 
 authorities, and agree that this appeal must be dismissed. 
 
 BRDADWELL v. GETMAN. 
 (Supreme Court of New York, 1846. 2 Denio, 87.) 
 
 Error to the Oneida common pleas. Getman sued Broadwell be- 
 fore a justice of the peace, and upon a trial by jury recovered $25 
 besides costs, and this judgment was affirmed by the C. P. upon cer- 
 tiorari. The plaintiff's claim was principally for damages for the 
 non-performance of a contract respecting the clearing of land. This 
 contract was entered into on the first day of Januai-y, 1841, and was 
 reduced to writing at the request of the parties and agreed to by them, 
 but was not signed. By its terms the defendant agreed to clear ofif a 
 piece of wood land belonging to the plaintiff, and make a fence two 
 logs high on one end of it, which fence the plaintiff was to complete. 
 The job was to be done by the spring of 1842, in season to put in a 
 spring crop that year; and the defendant was to have for his com- 
 pensation all the wood and timber growing on the premises, except 
 what should be necessary for the fence, and also the first crop, which 
 he was to put in in the spring of 1842. Both parties gave evidence 
 upon the question whether the defendant had fully cleared off the 
 land and as to the amount necessary to complete it. Before the 
 cause was submitted to the jury, the defendant's counsel requested 
 the justice to charge, that if a longer time was given by the contract 
 to complete the work than one year from the time of making thereof, 
 it was void ; but he refused so to charge. 
 
SeCi 4) CONTRACTS NOT TO BE PERFORMED WITHIN ONE YEAR 1423 
 
 By the Court, Beardsley, J. The special agreement between these 
 parties was to endure for nearly twq years. It was made on the first 
 of January, 1841, and although the clearing was to be done by a year 
 from the next spring, the defendant was to have the use of the land 
 for a crop to be put in by him at that time. 
 
 By the statute every agreement which by its terms is not to be per- 
 formed within one year from the making thereof, is declared to' be 
 void, unless in writing and subscribed by the party to be charged 
 therewith. 2 R. S. 135, § 2, subd. 1. Agreements which may be com- 
 pleted within one year are not within the statute ; it extends to such 
 only as by their express terms are not to be, and cannot be carried 
 into full and complete execution until after the expiration of that 
 period of time. Fenton v. Emblers, 3 Burr. 1278 ; Boydell v. Drum- 
 mond, 11 East, 142; Bracegirdle v. Heald, 1 Barn. & Aid. 723; Chit. 
 on Cont. 67; 1 Smith's Leading Cases and Notes (Phil. Ed.) 143; 
 Lockwood v. Barnes, 3 Hill, 128, 38 Am. Dec. 620 ; Russell v. Slade, 
 12 Conn. 455. 
 
 The word "agreement," as used in this section, signifies "a mutual 
 contract on consideration between two or more persons," and ex vi 
 termini, includes the several parties to the contract and their respec- 
 tive stipulation: every thing, indeed, which is to be done on both 
 sides. Wain v. Warlters, 5 East, 10; Sears v. Brink, 3 John. 210, 3 
 Am Dec. 475; Sherburne v. Shaw, IN. H. 157, 8 Am. Dec. 47; 
 Champion v. Plummer, 1 New R. 252; 2 Stark. Ev. 482 (Phil. Ed. of 
 1842). In this case there were mutual stipulations between the par- 
 ties : the defendant was to clear the land and in part make a fence at 
 one end of the lot. This fence was to be completed by the plamtifif ; 
 and he stipulated that the defendant should have all the timber cut 
 on the land except what might be required for the fence, and also the 
 U6e of the land for a summer crop in 1842. As this agreement was 
 made in January, 1841, and could not be completely executed until 
 the close of the season of 1842, it was within the statute, and not 
 being in writing and signed, was void. Upon this point it would seem 
 difficult to raise a doubt upon the terms of the statute. An agreement 
 is an entire thing, and where that cannot be completely executed, on 
 both sides, until more than a year has elapsed, the case falls withm 
 the express words of the enactment. It is also withm its spirit, for 
 "the mischief meant to be prevented by the statute, was the leaving to 
 memory the terms of a contract for longer time than a year. The 
 persons' might die who were to prove it; or they might lose their 
 faithful recollection of the terms of it." Bailey, J., 11 East, 159, 1 
 
 ^ Th^e' g'nemt principle is firmly settled that although the agree- 
 ment requires a part performance within a year, and is so far faith- 
 Mv executed Jn it is void, unless reduced to writing, if other stipu- 
 itLs relin o be exec|.ted after the close of the year. Lockwood 
 I Barnes supra. But notwithstanding the apparent universality and 
 loundness' of Ais position, it is laid down by some elementary writers 
 
1424 .; :;• .^ the statute, of fraidds _. ,:; (Gh. 10 
 
 that the statute does not extend to contracts, "where all 4iat is to be 
 done by one of the parties is to be done within a year." 2 Leigh's 
 N. P. 1045 ; Chit, on Cont. 69 ; Long on Sales, 56. This distinction 
 had been suggested in Boydeh v. Drummond and Bracegirdle v. 
 Heald, supra, and was finally acted upon in the case of Donellan v. 
 Read, 3 Barn. & Adol. 899, which was decided in 1832. In the last 
 case, Littledale, J., who delivered the opinion of the court said, "as 
 to the contract not being to be performed within a year, we think that 
 as the contract was entirely executed on one side within a year, and 
 as it was the intention of the parties, founded on a reasonable expecta- 
 tion, that it should be so, the statute of frauds does not extend to 
 such a case. In case of a parol sale of goods, it often happens that 
 they are not to be paid for in full till after the expiration of a longer 
 period of time than a year ; and surely the law would not sanction a 
 defence on that ground, when the buyer had had ther full benefit of the 
 goods on his part." See also Holbrook v- Armstrong, 10 Me. 31. 
 The principle affirmed in these cases has no application to the present 
 case ; for here the party seeking' to enforce the contract was not to 
 perform all its stipulations, on his part, within the year: he was to 
 permit the defendant to occupy and use the land through the season of 
 1842, which time did not commence until more than a year after the 
 contract had been entered into. But "I would not be understood as 
 yielding my assent to the principle stated. It seems to me in plain 
 violation of the statute. Every verbal contract which is not to be per- 
 formed within a year fromi the making thereof, is declared to be void. 
 Although the terms of the agreement may require full performance 
 on one side within a year, I do not see how this can exclude it from 
 the statute, the other side being incapable of execution until after the 
 year has elapsed. The agreement is entire, and if it carniof be ex- 
 ecuted fully, on both sides, within the year, I think it is void. What 
 difference does it make that one party can, while the other cannot, 
 complete the contract within a year? Such an agreement is not, 
 in terms, excepted from the statute, and the reason for the enactment 
 apphes to it with full force. But it is unnecessary to pursue this sub- 
 ject; and I dismiss it with the remark that although: where one party 
 has fully performed on his part within the year, the agreement may 
 notwithstanding be void, still he is not remediless, for he may main- 
 tain a general indebitatus assumpsit against the party who refuses to 
 proceed further under the contract, and thus recover a compensation 
 for what has been advanced and received upon it. Lockwood v. 
 Barnes, Holbrook v. Armstrong, supra. See also Smith's Leading 
 Cases, as referred to above ; Mavor v. Pyne, 2 Car. & Payne, 91, and 
 3 Bing. 285. 
 
 The contract was void and the plaintifif should not have recovered, 
 as he did, for its violation. 
 
 Judgment reversed.^" ,., 
 
 21 In accord' that a contract is within the statute if it Is not to be per- 
 formed by one party within one year, even though the duties of the other 
 
Sec. 4) CONTRACTS NOT TO BE PERFORMED WITHIN ONE YEAS 1425 
 
 PROKOP V. BEDFORD WAIST & DRESS CO. 
 
 (Supreme Court of New York, Appellate Term, 1919. 105 Misc Rep 573 173 
 
 N. Y. Supp. 792.) 
 
 Action by Prokop J. Prokop against the Bedford Waist & Dress 
 Company. Verdict and judgment for plaintiff, and defendant appeals. 
 jTidgment affirmed, with leave to appeal to the Appellate Division. 
 
 BijUR, J." The facts which the jury was warranted in finding are 
 that the plaintiff was employed as?' a pattern maker by the defendant 
 on Monday, September 10, 1917, on trial for one week. On the fol- 
 lowing Saturday, the 15th, the defendant said to plaintiff, "You will 
 have to give me another week's time," to which plaintiff assented. On 
 the succeeding Saturday, the 22d of September, before noon, the de- 
 fendant said to plaintiff : " 'I want a man for the whole year. You 
 will have the whole year a job with me; you go ahead;' and so I 
 did." 
 
 Plaintiff continued his work on the Saturday 'morning of the con- 
 versation last recited, and returned after 12 o'clock noon, at which 
 time work had been suspended in the factory, and did some work. He 
 continued in defendant's employ until he was discharged in March, 
 1918, and thereupon brought this action for breach of contract of 
 employment. 
 
 Appellant's reliance on this appeal is upon an exception to the re- 
 fusal of the court below to charge that : "If the jury believe the plain- 
 tiff's version, that an agreement was made on September 22d, but that 
 plaintiff was to commence in the performance of that work on the 
 following Monday, that they must find for the defendant under the 
 statute of frauds." Appellant cites as authority for his position Jonap 
 V. Preger, 59 M^sc. Rep. 187, 110 N. Y. Supp. 483. 
 
 First, it must be pointed out that the request was inaccurate in its 
 statement of the terms of the new contract as proved. I do not find 
 in the record any evidence that plaintiff was not to commence work 
 under the new contract until the following Monday ; on the contrary, 
 there is testimony by the plaintiff that he was "to commence work 
 under that new arrangement right the saine afternoon." But, even 
 apart from that consideration, the mere fact that physicarwork is not 
 begun or required to be performed under a contract Of service until 
 a particular day subsequent does not necessarily imply that the per- 
 formance of the contract, within the language of subdivision 1 of sec- 
 party may be performed within that, period : Dietrich v. Hoef elmeir, 128 Mich. 
 145 87 N. W. Ill (1901); Marcy v. Marcy, 9 Allen (Mass.) 8 (1864). 
 Contra- Donellan v. Bead, 3 B. & Ad. 899 (1832) ; Cherry v. Heming, 4 Ex. 
 eSl (1849) ; Fraser v. Gates, 118 111. 99, 1 N. E. 817 (1885) ; Piper v. Eosher, 
 121 Ind 407, 23 N. B. 269 (1889) ; Smalley v. Greene, 52 Iowa, 241, 3 N. 
 W 78 35 Am. Rep. 267 (1879) ; Bless v. Jenkins, 129 Mo. 647, 31 S. W. 998 
 (1895) ; Grace v. Lynch, 80 Wis. 166, 49 N. W. 751 (1891). 
 27 Part of the opinion is omitted. 
 
 COBBIN CONT — 90 
 
1426 THE STATUTE OF FRAUDS (Ch, 10 
 
 tion 31 of the Personal Property Law (Consol. Laws, c. 41), the statute 
 of frauds, has not begun at an earlier date. The statute reads, so 
 far as applicable: "Every agreement * * * jg void" unless it be 
 in writing "if such agreement : * * * 1. By its terms is hot to be 
 performed within one year from the making thereof." 
 
 It was held in McAleer v. Corning, 50 N. Y. Super. Ct. 63, 65 : 
 "If a contract of hiring is made for one year, to begin in prsesenti, no 
 services to be doiie by the employe until a future day, the contract is 
 operative from the day of its makirag, and the year ends with the end- 
 ing of one year from that day. It might be a natural mistake for a 
 layman to think that, as a year of actual affirmative service could not 
 begin until some service was done, that the contract for services 
 was not operative until the day when something was to be done by 
 him." See, also, Sprague v. Foster, 48 111. App. 140. 
 
 In other words the contract becomes operative and, its performance 
 is begun when the one contractor becomes a servant and the other an 
 employer; i. e., when the former comes under the obligation which 
 that relation implies. 
 
 Assuming, now, ,that the decision in Jonap v. Preger, supra, is sup- 
 ported by authority in holding that an oral contract of employment 
 for the term of one year, to commence on the following day, is void, 
 the question is whether the instant case presents such a contract. In 
 Jonap V. Preger the plaintiff employe was admittedly working for the 
 defendant under a yearly agreement which expired on March 23, 1907. 
 On that day, according to plaintiff's testimony, the defendant said to 
 him, "I will renew your contract from to-day for another year." The 
 court said, in commenting upon this testimony : "In order to hold that 
 the new year began on the 23d, it would be necessary to hold that the 
 new contract rescinded the old contract, so far as the unexpired 
 * * * period covered by it, was concerned, and that the new con- 
 tract took effect before the termination of the old one and superseded 
 it. There is nothing in the language testified to that would warrant 
 such a construction." 
 
 But I do not see why it is necessary to hold that the preceding con- 
 tract would be "rescinded so far as the unexpired portion of the pe- 
 riod covered by it was concerned." All that would be implied through 
 holding the new contract to be operative forthwith would be that the 
 employer had disregarded the fact that he was paying the employe 
 doubly for a negligible fraction of the old term. 
 
 If the Jonap Case was correctly interpreted, the statute to the ef- 
 fect that an agreement "to be performed within one year from the 
 making thereof" means an agreement the term of which begins at the 
 very instant of the making of the contract, then it seems to me that 
 by the same token like import should be accorded to the words of the 
 contracting parties when they employ substantially the language of the 
 statute. If the strict interpretation is appropriate to the language of 
 the statute, the same standard should be applied to the language of 
 
Sec. 4) CONTRACTS NOT TO BE PERFORMED WITHIN ONE YEAR 1427 
 
 the contractor. Therefore, where a party agrees to enter the employ 
 of another for one year, the year should be held to begin eo instante. 
 See Russell v. Slade, 12 Conn. 455. But in my opinion that is not the 
 correct construction of the statute. A year, like a day, a week, and a 
 month, is a common division of time of universal application. A con- 
 tract for a year means a contract for 365 days. Now it would be, 
 to say the least, unusual for parties during the course of a business 
 day to contract for a year, intending tp include within the term of the 
 contract the whole of the day upon which the contract is made. That 
 would imply that they were making a contract for a year, part of 
 which had already elapsed. It would also be equally unlikely, except 
 under pecuHar circumstances, that a contract should, during the course 
 of a business day, be entered into with the expectation that its term. 
 begin at the moment it is made. As a practical matter, such a course 
 would ordinarily, for a number of obvious reasons, be so inconvenient 
 as to render it exceptional. The natural and usual assumption, I think, 
 in the absence of a particular provision to the contrary, would be that 
 the parties intended performance to begin on the next day. 
 
 This rational view of the significance of the statute accords also 
 with the established canon of statutory construction that fractions of 
 a day, will not be considered, except where that course is necessary to 
 prevent injustice, as, for example, in ascertaining the priorities of cred- 
 itors. One of the purposes of the rule is to accord to the parties enti- 
 tled thereto the whole of the period specified, and since by the very 
 premise they do not enjoy the whole of the first day, that day is ex- 
 cluded from the computation. Cowles, J., in Phelan v. Douglass, 11 
 How. Prac. 193, 195, 196; Judd v. Fulton, 4 How. Prac. 298; Haden 
 v. Buddensick, 49 How. Prac. 241, 246 — all cited in Marvin v. Marvin, 
 75 N. Y. 240, 243. See, also. People v. N. Y. C. R. R. Co., 28 Barb. 
 284, 286, and People v. Sheriff of Broome, 19 Wend. 87. 
 
 It seems fair to assume that the framers of the statute of frauds 
 had these practical considerations in mind; otherwise, the provision 
 of section 4, which we are considering, would have been tantamount 
 to the inhibition of most oral contracts for a year — a result that was 
 manifestly not intended. 
 
 I am of the opinion, therefore, that an oral contract for a year, to 
 commence on the day following its making, is not within the inhibition 
 of the statute. I say this with all deference to the learned judges 
 who have written in the three cases in this state which hold the con- 
 trary, and because I am convinced that their opinions were based upon 
 a misapprehension of the authorities which they have cited, and upon 
 an unexplained failure to consider the rule just discussed, which 
 formed the basis of the decisions in Dickson v. Frisbee, 52 Ala. 165, 
 23 Am. Rep. 565 (1875), and Smith, v. Gold Coast & Ashanti Explor- 
 ers, Ltd., [1903] IK. B. 195. 
 
 The first case in the books in which this precise Rfl«it is even men- 
 tioned was Cawthorne v. Cordrey, decided in EnglanWn 1863, and re- 
 
1428 THE STATUTE OF FRAUDS (Ch. 10 
 
 ported in 13 C. B. (N. S.) 406. Although the headnote in that case 
 reads: "A contract of hiring made on the 24th of March for a 
 year's service to commence on the 25th is not void by the fourth sec- 
 tion of the statute of frauds fpr want of a memorandum" — ^that state- 
 ment is manifestly erroneous, for the case actually decided that: 
 "There clearly was evidence upon which the jury were at liberty to 
 find that there was a contract on Monday, the 24th, for a year's serv- 
 ice; aiid it is no objection that the receipt which the' plaintiff gave 
 for the £20 advanced described the contract as being for services from 
 Lady Day (Sunday) to Lady Day." 
 
 In other words, the actual decision was that the evidence warranted 
 a finding by the jury that the contract was made on Monday, the 24th,' 
 for a year's service, and not on the preceding Sunday for a year's serv- 
 ice to begin the following Monday. In the course of the argument, 
 however, there were a number of colloquies between judges and coun- 
 sel, as is so common in English courts. Wills, J., said : "If a builder 
 und^takes .to build a house within a year, that means a year from the 
 next day." Byles, J., remarked: "If you adopt the reasonable rule, 
 which excludes fractions of a day, taking the receipt to define the dura- 
 tion of the contract, there would be only 365 days." 
 
 These two statements were indeed mere dicta, but they express the 
 view ultimately adopted by the Supreme Court of Alabama and the 
 courts of England. There are no decisions in point in any state of the 
 Union outside of New York. As I interpret the remark of Wills, J., 
 it was intended to indicate (what I have discussed above) that the 
 framers of the statute, when they prescribed that a contract to be per- 
 formed within one year from the making thereof need not be in writ- 
 ing, had in mind the practical fact that a contract for a year's service, 
 and other agreements covering a year, are usually made in the 
 course of the day preceding the beginning of performance. The com- 
 ment of Byles, J., plainly suggests that this accords with the ac- 
 cepted rule of construction, which excludes fractions of a day. 
 
 The next time that this precise question arose was in Dickson v. 
 Frisbee, 52 Ala. 165, 23 Am. Rep. 565 (1875). Although the court 
 there was evidently misled by the headnote in the Cawthorne Case to 
 the extent of citing it as authority for the proposition that "a contract 
 made on one day for a year's service to commence on the next was 
 not within the statute of frauds," the reference to the Cawthorne Case 
 followed a discussion of the law, concluding that : "This construc- 
 tion is in iaccordance with the ordinary rule for the computation of time 
 which excludes fractions of a day." 
 
 It will thus be seen that the court placed its decision upon the very 
 point indicated by Byles, J., in his dictum in the Cawthorne Case. The 
 Dickson Case was followed in Smith v. Pritchett, 98 Ala, 649, 13 
 South. 569. * * * 
 
 Meanwhile tM^' point had arisen for decision in England in Dollar 
 V. Parkington (*;. B. Div. 1901), reported in 84 L. T. 470, in which 
 
Sec. 4) CONTRACTS NOT TO BE PERFORMED WITHIN ONE YEAR 1429 
 
 Darling, J., decided that an oral contract for the hiring of horses for 
 a year, to commence on the day following, is -within the statute, on 
 the authority of Lord Ellenborough's general comment in Bracegirdle 
 V. Heald. He declined to follow the dicta in Cawthorne v. Cordrey, 
 and refers to the opinion of Brett, J., in Brittain v. Rossiter (1879) 
 L. R. 11 Q. B. Div. 123, to the effect that those dicta have never been 
 converted into a decision. He also remarks upon the curious fact that 
 the precise question had never been decided by the courts of England, 
 although the statute of frauds had been the subject of more litigation 
 than any other statute of the realm. 
 
 The English bar, however, did not have to wait long for an au- 
 thoritative expression on this question by an appellate court. In 
 Smith v. Gold Coast & Ashanti Explorers, Ltd., [1903] 1 K. B. 285, 
 Lord Alverstone, C. J., with the concurrence of Wells and Channell, 
 JJ., expressly approved the dicta in the Cawthorne Case, and the 
 favorable comment thereon by Brett, J., in the Brittain Case, and 
 added that the question there suggested had now arisen for decision. 
 The court then held: "That a contract for a year's service, to com- 
 mence on the day next after the date on which the contract was made, 
 is not an agreement which is not to be performed within the space of 
 one year from the making thereof, within the meaning of section 4 of 
 the statute of frauds." 
 
 It is significant that this decision is founded expressly on the rule 
 that the law does not regard fractions of a day, which formed the 
 basis, as I have shown, of the similar decision in Dickson v. Frisbee, 
 52 Ala., supra. Evidently the attention of the Appellate Term in Jonap 
 v. Preger was not called to the decision in the Smith Case. My 
 conclusion, therefore, is that the oral contract in the instant case — 
 whether interpreted as one to begin on the same day or the day after 
 it was made — is not rendered invalid by the statute of frauds. 
 
 Judgment affirmed, with $25 costs, and with leave to appeal to the 
 Appellate Division. All concur.^ ^ 
 
 28 The court's discussion of some of tlie authorities Is omitted. Contra, 
 and expressly disapproved, are Levlson v. Stix, 10 Daly (N. Y.) 229 (1881) ; 
 Billington V. Cahill, 51 Hun, 132, 4 N. T. Supp. 660 (1889). In accord, and 
 cited above, are Dickson v. Frisbee, 52 Ala. 165, 23 Am. Rep. 565 (1875) ; 
 Smith V. Pritchett, 98 Ala. 649, 13 South. 569 (1893) ; Smith v. Gold Coast, 
 etc., Ltd., [1903] 1 K. B. 285. 
 
1430 THE STATUTE OP FRAUDS (Ch. 10 
 
 SECTION 5.— CONTRACTS FOR THE SAI.E OF GOODS 
 
 LEE V. GRIFFIN. 
 (In the Court of Queen's Bench, 1861. 1 Best & S. 272.) 
 
 Declaration against the defendant, as the executor of one Frances 
 P., for goods bargained and sold, goods sold and delivei'ed, and for 
 work and labour done and materials provided by the plaintiff as a 
 surgeon-dentist for the said Frances P. 
 
 Plea. That the said Frances P. never was indebted as alleged. 
 
 The action was brought to recover the Sum of £21 for two sets of 
 artificial teeth ordered by the deceased. 
 
 At the trial, before Crompton, J., at the Sittings for Middlesex 
 after Michaelmas Term, 1860, it was proved by the plaintiff that he 
 had, in pursuance of an order from the deceased, prepared a model 
 of her mouth and made two sets of artificial teeth ; as soon as they 
 were ready he wrote a letter to the deceased, requesting hef to appoint 
 a day when he could see her for the purpose of fitting them. To this 
 communication the deceased replied as follows: 
 
 "My Dear Sir. — I regret, after your kind effort to oblige me, my 
 health will prevent my taking advantage of the early day. I fear I 
 may not be able for some days. — Yours &c. Frances P." ' " 
 
 Shortly after writing the above letter, Frances P. died. On these 
 facts the defendant's counsel contended that the plaintiff ought to be 
 lionsuited, on the ground that there was no evidence of a delivery and 
 acceptance of the goods by the deceased, nor any memorandum in writ- 
 ing of a contract within the meaning of the 17th section of the Stat- 
 ute of Frauds, 29 Car. II, c. 3, and the learned Judge was of that opin- 
 ' ion. The plaintiff's counsel then . contended that, on the authority of 
 Clay V. Yates, 1 H. & N. 72>, the plaintiff could recover in the action 
 on the count for work and labour done and materials provided. The 
 learned Judge declined to nonsuit, and directed a verdict for the 
 amount claimed to be entered for the plaintiff, with leave to the de- 
 fendant to move to enter a nonsuit or verdict. 
 
 In Hilary Term following, a rule nisi having been obtained accord- 
 ingly, 
 
 Patchett now shewed cause. 
 
 Crompton, J. I think that this rule ought to be made absolute. On 
 the second point I am of the same opinion as I was at the trial. There 
 is not any sufficient memorandum in writing of a contract to satisfy 
 the Statute of Frauds. The case decided in the House of Lords, to 
 which reference has been made during the argument, is clearly dis- 
 tinguishable. That case only decided that if a document, which is 
 silent as to the particulars of a contract, refers to another document, 
 which contains such particulars, parol evidence is admissible for the 
 
^^*^- ^) CONTRACTS FOE THE SALE OF GOODS 1431 
 
 purpose of shewing what document is referred to. Assuming, in this 
 case, that the two documents were sufficiently connected, still there 
 would not be any sufficient evidence of the contract. The contract in 
 question was to deliver some particular teeth to be made in a particu- 
 lar way, but these letters do not refer to any particular bargain, nor 
 in any manner disclose its terms. 
 
 The main question which arose at the trial was, whether the con- 
 tract in the second count could be treated as one for work and labour, 
 or whether it was a contract for goods sold and delivered. The dis- 
 tinction between these two causes of action is sometimes very fine; 
 but, where the contract is for a chattel to be made and delivered, it 
 clearly is a contract for the sale of goods. There are some cases in 
 . which the supply of the materials is ancillary to the contract, as in 
 the case of a printer supplying the paper on which a book is printed. 
 In such a case an action might perhaps be brought for work and labour 
 done, and materials provided, as it could hardly be said that the subject- 
 matter of the contract was the sale of a chattel : perhaps it is more 
 in the nature of a contract merely to exercise skill and labour. Clay 
 v. Yates, 1 H. & N. 73, turned on its own peculiar circumstances. I 
 entertain some doubt as to the correctness of that decision; but I 
 certainly do not agree to the proposition that the value of the skill and 
 labour, as compared to that of the material supplied, is a criterion by 
 which to decide whether the contract be for work and labour or for 
 the sale of a chattel. Here, however, the subject-matter of the contract 
 was the supply of goods. The case bears a strong resemblance to that 
 of a tailor supplying a coat, the measurement of the mouth and fitting 
 of the teeth being analogous to the measurement and fitting of the 
 garment. 
 
 Hill, J. I am of the same opinion. I think that the decision in 
 Clay V. Yates, 1 H. & N. 73, is perfectly right. That was not a case in 
 which a party ordered a chattel of another which was afterwards to 
 be made and delivered, but a case in which the subject-matter of the 
 contract was the exercise of skill and labour. Wherever a con- 
 tract is entered into for the manufacture of a chattel, there the sub- 
 ject-matter of the contract is the sale and delivery of the chattel, and 
 the party supplying it cannot recover for work and labour. Atkinson 
 V. Bell, 8 B. & C. 277, is, in my opinion, good law, with the exception 
 of the' dictum of Bayley, J., which is repudiated by Maule, J., in 
 Grafton v. Armitage, 2 C. B. 339, where he says : "In order to sus- 
 tain a count for work and labour, it is not necessary that the work and 
 labour should be performed upon materials that are the property of 
 the plaintiff." And Tindal, C. J., in his judgment in the same case, 
 p. 340, points out that in the application of the observations of Bay- 
 ley, J.', regard must be had to the particular facts of the case. In 
 every other respect, therefore, the case of Atkinson v. Bell, 8 B. & 
 C. 277, is law. I think that these authorities are a complete answer to 
 the point taken at the trial on behalf of the plaintiff. 
 
1432 THE STATUTE OF FEAUDS (Ch, 10 
 
 When, however, the facts of this case are looked at, I cannot^ see 
 how, wholly irrespective of the question arising under the Statute of 
 Frauds, this action can be maintained. The contract entered into by 
 the plaintiff with the deceased was to supply two sets of teeth which 
 were to be made for her and fitted to her mouth, and then to be paid 
 for. Through no default on her part, she havmg died, they never were 
 fitted: no action can therefore be brought by the plaintiff. 
 
 Blackburn, J. On the second point, I am of opinion that the letter 
 is not a' sufficient memorandum in writing to take the case out of the 
 Statute of Frauds. 
 
 On the other point, the question is whether the contract was one 
 for the sale of goods or for work and labour. I think that in all cases, 
 in order to ascertain whether the action ought to be brought for goods 
 sold and delivered, or for work and labour done and materials pro- 
 vided, we must look at the particular contract entered into between the 
 parties. If the contract be such that, when carried out, it would result 
 in ; the sale of a chattel, the party cannot sue for work and labour; 
 but, if the result of the contract is that the party has done work and 
 labour which ends in nothing that can become the subject of a sale, 
 the party cannot sue for goods sold and delivered. The case of an 
 attorney employed to prepare a deed is an illustration of this latter 
 proposition. It cannot be said that the paper and ink he uses in the 
 preparation of the deed are goods sold and delivered. The case of a 
 printer printing a book would most probably fall within the same cat- 
 egory. In Atkinson v. Bell, 8 B. & C277, the contract, if carried out, 
 would have resulted in the sale of a chattel. Iri Grafton v. Armitage, 
 2 C. B. 340, Tindal, C. J., lays down this very principle. He draws a 
 distinction between the cases of Atkinson v. Bell, 8 B. & C. 277, and 
 that before him. The reason he gives is that, in the former case, 
 "the substance of the contract was goods to be sold and delivered by 
 the one party to the other :" in the latter "there never was any inten- 
 tion to make anything that could properly become the subject of an 
 action for goods sold and delivered." I think that distinction rec- 
 onciles those two cases, and the decision of Clay v. Yates, 1 H. & N. 
 73, is not inconsistent with them. In the present case the contract was 
 to deliver a thing which, when completed, would have resulted in the 
 sale of a chattel; in other words, the substance of the contract was 
 for goods sold and delivered. I do not think that the test to apply to 
 these cases is whether the value of the work exceeds that of the ma- 
 terials used in its execution; for, if a sculptor were eniployed to ex- 
 ecute a work of art, greatly as his skill and labour, supposing it to be 
 of the higheslj description, might exceed the value of the marble on 
 which he worked, the contract would, in my opinion, nevertheless be 
 a contract for the sale of a chattel. 
 
 Rule absolute.^' 
 
 2 8 In accord: Pratt v. Miller, 109 Mo. 78, 18 S. W. 965, 32 Am. St. Rep. 
 656 (1891). 
 
Sec. 5) CONTRACTS FOR THE SALE OF GOODS 1433 
 
 GODDARD V. BINNEY. 
 
 (Supreme Judicial Court of Massachusetts, 1874. 115 Mass. 450, 15 Am 
 
 Rep. 112.) 
 
 Contract to recover the price of a buggy built^by plaintiff for de- 
 fendant. Plaintiff agreed to build a buggy for defendant, and to de- 
 liver It at a certain time. Defendant gave special directions as to 
 style and finish. The buggy was built according to directions. Before 
 it was finished, defendant called to see it, and in answer to plaintiff, 
 who asked him if he would sell it, said no; that he would keep it! 
 When the buggy was finished, plaintiff sent a bill for it, which .defend- 
 ant retained, promising to .^ee plaintiff in regard to it. The buggy was 
 afterwards burned in plaintiff's possession. The case was reported to 
 the supreme judicial court.'" 
 
 Ames, J. Whether an agreement like that described in this report 
 should be considered as a contract for the sale of goods, within the 
 meaning of the statute of frauds, or a contract for labor, services and 
 materials, and therefore not within that statute, is a question upon 
 which there is a conflict of authority. According to a long course of 
 decisions in New York, and in some other states of the Union, an 
 agreement for the sale of any commodity not in existence at the time, 
 but which. the vendor is to manufacture or put in a condition to be 
 delivered (such as flour from wheat not yet ground, or nails to be 
 made froin iron in the vendor's hands), is not a contract of sale with- 
 in the meaning of the statute. Crookshank v. Burrell, 18 Johns. (N. 
 Y.) 58, 9 Am. Dec. 189; Sewall v. Fitch, 8 Cow. (N. Y.) 215 ; Robert- 
 son V. Vaughn, 7 N. Y. Super. Ct. I; Downs v. Ross, 23 Wend. 270; 
 Eichelberger v. M'Cauley, 5 Har. & J. (Md.) 213, 9 Am. Dec. 514. In 
 England, on the other hand, the tendency of the recent decisions is to 
 treat all contracts of such a kind intended to result in a sale, as sub- 
 stantially contracts for the sale of chattels; and the decision in Lee 
 V. Griffin, 1 B. & S. 272, goes so far as to hold that a contract to make 
 and fit a set of artificial teeth for a patient is essentially a contract for 
 the sale of goods, and therefore is .subject to the provisions of the 
 statute. See Maberley' v. Sheppard, 10 Bing. 99; Howe v. Palmer, 3 
 B. & Aid. 321 ; Baldey v. Parker, 2 B. & C. 37; Atkinson v. Bell, 8 B. 
 
 & C. 277. 
 
 Iti this commonwealth, a rule avoiding both of these extremes was 
 established in Mixer v. Howarth, 21 Pick. 205, 32 Am. Dec. 256, and 
 has been recognized and affirmed in repeated decisions of more recent 
 date. The effect of these decisions we understand to be this, namely, 
 that a contract for the sale of articles then existing or such as the 
 vendor in the ordinary course of his business manufactures or pro- 
 cures 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 
 
 so The statement of facts is rewritten. 
 
1434 THE STATUTE OF FRAUDS (Ch. 10 
 
 the other hand, if the goods are to be manufactured especially for the 
 purchiaser, and upon his special order, and not for the general market, 
 the case is not within the statute. Spencer v. Cone^ 1 Mete. 283. 
 "The distinction," says Chief Justice Shaw, in Lamb v. Crafts, 12 
 Mete. 353, "we believe is now well understood. When a person stip- 
 ulates for the future sale of articles, which he is habitually making, 
 and which, at the time, are not made or finished, it is essentially a 
 contract of sale, and not a contract for labor; otherwise, when the 
 article is made pursuant to the agreement." In Gardner v. Joy, 9 
 Mete. 177, a contract to buy a certain number of boxes of candles at a 
 fixed rate per pound which the vendor said he would manufacture and 
 deliver in about three months, was held to be a contract of sale and 
 within the statute. To the same general effect are Waterman v. Meigs, 
 4 Cush. 497, and Clark v. Nichols, 107 'Mass. 547. It is true that in 
 "the infinitely various shades of different contracts," there is some 
 practical difficulty in disposing of the questions that arise under that 
 section of the statute. Gen. St. c. 105, § 5. But we see no ground 
 for holding that there is any uncertainty in the rule itself. On the 
 contraxy, its correctness and justice are clearly implied or expressly 
 affirmed in all of our decisions upon the subject matter. It is proper 
 to say also that the present case is a much stronger one than Mixer 
 V. Howarth. In this case, the carriage was not only built for the de- 
 fendant, but in conformity in some respects with his directions, and at 
 his request was marked with his initials. It was neither intended nor 
 adapted for the general market. As we are by no means prepared to 
 overrule the decision in that case, we must therefore hold that the 
 statute of frauds does not apply to the contract which the plaintiff is 
 seeking to enforce in this action. 
 
 Independently of that statute, and in cases to which it does not 
 apply, it is well settled that as between the immediate parties, prop- 
 erty in personal chattels may pass by bargain and sale without actual 
 delivery. If the parties have agreed upon the specific thing that is 
 sold and the price that the buyer is to pay for it, and nothing remains 
 to be done but that the buyer should pay the price and take the same 
 thing, the property passes to the buyer, and with it the risk of loss by 
 fire or any other accident. The appropriation of the chattel to the 
 buyer is equivalent, for that purpose, to delivery by the seller. The 
 assent of the buyer to take the specific chattel is equivalent for the 
 same purpose to his acceptance of possession. Dixon v. Yates, 5 B. 
 & Ad. 313, 340. The property may well be in the buyer, though, the 
 right of possession, or lien for the price, is in the seller. There could 
 in fact be no such lien without a change of ownership. No man can 
 be said to have a lien, in the proper sense of the term, upon his own 
 property, and the seller's lien can only be upon the buyer's property. 
 It has often been decided that assumpsit for the price of goods bar- 
 gained and sold can be maintained where the goods have been selected 
 hy the buyer, and set apart for him by the seller, though not actually 
 
Sec. 5) CONTEACTS FOR THE SALE OF GOODS 
 
 1435 
 
 delivered to him, and where nothing remains to be done except that 
 the buyer could pay the agreed price. In such a state of things the 
 property vests in him, and with it the risk of any accident that may 
 happen to the goods in the meantime. Noy's Maxims, 89 ; 2 Kent. 
 Com. (12th Ed.) 492 ; Bloxam v. Sanders, 4 B. & C. 941 ; Tarling 
 V. Baxter, 6 B. & C. 360; Hinde v. Whitehouse, 7 East, 571; Ma- 
 comber V. Parker, 13 Pick. 175, 183 ; Morse v. Sherman, 106 Mass. 
 430. 
 
 In the present case, nothing remained to be done on the part of the 
 plaintiff. The price had been agreed upon; the specific chattel had 
 been finished according to order, set apart and appropriated for the 
 defendant, and marked with his initials. The plaintiff had not under- 
 taken to deliver it elsewhere than on his own premises. He gave no- 
 tice that jt was finished, and presented his bill to the defendant, who 
 ■promised to pay it soon. He had previously requested that the car- 
 riage should not be sold, a request which substantially js equivalent to 
 asking the plaintiff to keep it for him when finished. Without con- 
 tending that these circumstances amount to a delivery and acceptance 
 within the statute of frauds, the plaintiff may well claim that enough 
 has been done, in a case not within that statute, to vest the general 
 ownership in the defendant, and to cast upon him the risk of loss by 
 fire, while the chattel remained in the plaintiff's possession. 
 
 According to the terms of the reservation the verdict must be set 
 aside, and judgment entered for the plaintiff. ^^ 
 
 BALDWIN V. WILLIAMS. 
 (Supreme Judicial Court of Massachusetts, 1841. 3 Mete. 365.) 
 This case was tried before Wilde, J., who made the following report 
 
 This was an action of assumpsit, and the declaration set forth an 
 agreement of the plaintiff that he would bargain, sell, assign, transfer, 
 and set over to the defendant, and indorse without recourse to him, 
 the plaintiff, in any event, two notes of hand by him held, signed by 
 S T Gardner ; one dated April 24th, 1835, for the payment of $1,500; 
 the other dated May 5th, 1836, for the payment of $500; and both pay- 
 aWe to the plaintiff or order on the 3d of April, 1839, with interest 
 from their dates. The declaration set forth an agreement by the de- 
 fendant, in consideration of the PJ^i^tiff's agreement a oresa:d^ 
 in payment for said Gardner's said notes, to pay the plaintiff $1,000 
 
 31 The rule in this case is substantially the same as that contained in 
 
 31 The rule in tnis case previously followed by most of the courts in 
 
 Uniform Sales Act, | 4- ".^f^^^P;; ^" ,^9 S .55 The New York rule had pre- 
 
 the united f t^^^s See Williston on Sales § 55^ for the sale of goods not in 
 
 viously excluded from the statute all coni ^ ^^^^ ^g jj. y. 17, 8 
 
 ^^^S li/flsSrorerSrd,'! N. Y. 352, 22 Am. Rep. 619 (1875). 
 F^ the present New York statute, see ante, p. 1375. 
 
1436 THE STATUTE OF FRAUDS (Ch*10 
 
 in cash, and to give the plaintiff a post note, made by the Ivafayette 
 Bank, for $1,000; and also a note signed by J. B. Russell & Co. and in- 
 dorsed by D. W. Williams for $1,000. 
 
 The plaintiff at the trial proved an oral agreement with the defend- 
 ant as set forth in the declaration, and an offer by the plaintiff to 
 comply with his part of said agreement, and a tender of said Gardner's 
 said notes, indorsed by the plaintiff without recourse to him in any 
 event, and a demand upon the defendant to fulfil his part of said agree- 
 ment, and the refusal of the defendant to do so. But the plaintiff in- 
 troduced no evidence tending to show that any thing passed between 
 the parties at the time of making the said agreement, or was given in 
 earnest to bind the bargain. 
 
 The judge advised a nonsuit upon this evidence, because the con- 
 tract was not in writing nor proved by any note or memorandum in 
 writing signed by the defendant or his agent, and nothing was received 
 by the purchaser, nor given in earnest to l^ind the bargain. A nonsuit 
 was accordingly entered, which is to stand if in the opinion of the 
 whole court the agreement set forth in the declaration fall's within the 
 statute of frauds (Rev. St. c. 74, § 4); otherwise, the nonsuit to be 
 taken off, and a new trial granted. 
 
 Wilde, J. This action is founded on an oral contract, and the 
 question is, whether it is a contract of sale within the statute of 
 frauds. 
 
 The plaintiff's counsel contends in the first place that the contract 
 is not a contract for the sale of the notes mentioned in the declaration, 
 but a mere agreement for the exchange of them; and in the second 
 place that if the agreement is to be considered as a contract of sale, yet 
 it is not a contract within that statute. 
 
 As to the first point, the defendant's counsel contends that an agree- 
 ment to exchange notes is a mutual contract of sale. But it is not nec- 
 essary to decide this question, for the agreement of the defendant, as 
 alleged in the declaration, was to pay for the plaintiff's two notes 
 $2,000 in cash, in addition to two other notes; and that this was a 
 contract of sale is, we think, very clear. 
 
 The other question is more doubtful. But the better opinion seems 
 to us to be, that this is a contract within the true meaning of the 
 statute of frauds. It is certainly within the mischief thereby intended 
 to be prevented; and the words of the statute, "goods" and "merchan- 
 dise," are sufficiently comprehensive to include promissory notes of 
 hand. The word "goods" is a word of large signification ; and so is 
 the word "merchandise." "Merx est quicquid vendi potest." 
 
 In Tisdale v. Harris, 20 Pick. 9, it was decided that a contract for 
 the sale of shares in a manufacturing corporation is a contract for 
 the sale of goods or merchandise within the statute; and the reasons 
 on which that decision was founded seem fully to authoiize a similar 
 decision as to promissory notes of hand. A different decision has re- 
 cently been made in England in Humble v. Mitchell, 3 Perry & D HI, 
 
Sec. 5) CONTRACTS FOB THE SALE OF GOODS 1437 
 
 11 Adol. & E. 207. In that case it was decided that a contract for 
 the sale of shares in a joint-stock banking company was not within the 
 statute of frauds. But it seems to us that the reasoning in the case of 
 Tisdale v. Harris is very cogent and satisfactory; and it is supported 
 by several other cases. In Mills v. Gore, 20 Pick. 28, it was decided 
 that a bill in equity might be maintained to compel the redelivery of 
 a deed and a promissory note of hand, on the provision in the Rev. 
 St. c. 81, § 8, which gives the court jurisdiction in all suits to compel 
 the redelivery of any goods or chattels whatsoever, taken and detained 
 from the owner thereof, and secreted or withheld, so that the same 
 cannot be, replevied. And the same point was decided in Clapp v. 
 Shephard, 23 Pick. 228. In a former statute (St. 1823, c. 140), there 
 was a similar provision which extended expressly to "any goods or 
 chattels, deed, bond, note, bill, specialty, writing, or other personal 
 property." And the learned commissioners, in a note on the Rev. St. c. 
 81, § 8, say that the words " 'goods or chattels' are supposed to compre- 
 hend the several particulars immediately following them in St. 1823, c. 
 140, as well as many others that are not mentioned." 
 
 The word "chattels'' is not contained in the provision of the statute 
 of frauds; but personal chattels are moveable goods, and so far is 
 these words may relate to the question under consideration they seem 
 to have the same meaning. But however this may be, we think the 
 present case cannot be distinguished in principle from Tisdale v. 
 Harris ; axid upon the authority of that case, taking into consideration 
 again the reasons and principles on which it was decided, we are of 
 opinion that the contract in question is within the statute of frauds, 
 and consequently that the motion to set aside the nonsuit must be over- 
 ruled.^^ 
 
 32 The English Sale of Goods Act (56 & 57 Vict. e. 71) defines goods 
 as "chattels personal other than things in action and money." The American 
 Uniform bales Act, § 4, expressly includes choses in action. See the New- 
 York statute, ante, p. 1375. This act merely codifies the already existing 
 general rule. See Greenwood v. Law, 55 N. J. Law, 168, 26 Atl. 134, 19 L. R. 
 A 688 (1892) ; Sprague v. Hosie, 155 Mich. 30, 118 N. W. 497, 19 L. E. A. (N- 
 S ) 874 130 Am. St. Rep. 558 (1008) ; Hewson v. Peterman Mfg. Co., 76 Wash. 
 600, 136 Pae. 1158, 51 L. R. A. (N. S.) 398, and, note Ann. Cas. 1915D, 346 
 (1913), aU dealing with shares of corporate stock; Williston on Sales, § 67. 
 
 A contract between two persons for the joint purchase of goods from a 
 third to be divided between them, partly in specie and partly m the proceeds 
 when resold, is not within the statute ; the contracting parties not being buyer 
 and seller. Stack v. Roth Bros. Co., 162 Wis. 281, 156 N. W. 148, Ann. Oas. 
 1918C, 741, note (1916). 
 
1438 THE STATUTE OF FRAUDS (Ch. 10 
 
 YOUNG V. INGALSBE. 
 (Court of Appeals of New York, 1913. 208 N. T. 503, 102 N. E. 590.) 
 
 Action by William E. Young against Grenville M. Ingalsbe, as ex- 
 ecutor of Lyman H. Northup, deceased. From a judgment of the 
 Appellate Division (151 App. Div. 375, 135 N. Y. Supp. 939) modify- 
 ing and affirming a judgment for defendant entered upon the report 
 of a referee to hear and determine the action, plaintiff appeals. Af- 
 firmed. 
 
 Collin, J. The plaintiff claimed, as a creditor, a sum from the es- 
 tate of Eyman H. Northup, deceased. The statute of limitations bar- 
 red his recovery (except as to one item allowed by the judgment of 
 the Appellate Division), unless a transaction between the plaintiff and 
 the deceased constituted a sale by the latter to the former of his in- 
 terest in certain books and the crediting by the former of the price up- 
 on the indebtedness, and prevented its application. The question for 
 our determination is: Did the transaction effect that result? 
 
 The transaction as found by the referee was : • The plaintiff and the 
 deceased owned, with equal interests, a law library. The deceased 
 was indebted to plaintiff and they, at a stated time, entered into ai-. 
 agreement, wholly unwritten, wliereby the plaintiff purchased the in- 
 terest of the deceased, the purchase price to be applied by the plaintiff 
 upon the indebtedness. Immediately after the time when the agree- 
 ment was made, the plaintiff accepted of the interest and caused to be 
 pasted upon the backs of the books leather labels with his name printed 
 thereon, took possession, and assumed and still assumes ownership of 
 the books, and gave the deceased credit for the sum of %77 on ac- 
 count of and pro rata on the several items of the indebtedness. 
 
 The part of the statute of frauds relevant to the transaction is: 
 "Every agreement, promise or undertaking is void, unless it or some 
 note or memorandum thereof be in writing, and subscribed by the par- 
 ty to be charged therewith, or by his lawful agent, if such agreement, 
 promise or undertaking : * * * (6) Is a contract for the sale of any 
 goods, chattels or things in action for the price of fifty dollars or mSre, 
 and the buyer does not accept and receive part of such goods, or the 
 evidences, or some of them, of such things in action ; nor at the time, 
 pay any part of the purchase money." Personal Property L,aw (Con- 
 sol. Laws 1909, c. 41) § 31. 
 
 The statute made void the verbal agreement in the present case un- 
 less there was, subsequent to and in pursuance of it, either the accept- 
 ance and receipt by the plaintiff of Northup's interest or the payment 
 by him, at the time the agreement was made, of the purchase price or 
 a part thereof. The rule of the common law that a mere contract for 
 the sale of goods, where nothing remains to be done by the seller be- 
 fore making delivery, transfers the right of property, although the 
 price has not been paid nor the thing sold delivered to the purchaser 
 
^^•^^ ^) CONTRACTS FOR THE SALE OP GOODS 1439 
 
 (Olyphant v. Baker, 5 Denio, 379; Bissell v. Balcom, 39 N. Y 275) 
 IS devitalized by the statute in the cases within its provisions. In those 
 cases the statute renders essential to- the proof of a valid contract of 
 sale, not only evidence of the verbal contract, but also evidence of a 
 receipt and acceptance by the vendee of a part of the goods or of a 
 payment at the time the oral agreement was made. The contract must 
 be authenticated by a prescribed act of the parties in pursuance and 
 part performance of it. The act may originate with the vendor or 
 vendee ; with the vendor if a delivery of part of the goodg»and their 
 acceptance by the vendee is the ground for validating the contract; 
 with the vendee if part payment is relied upon. In either case the 
 participation and assent of both/parties to it is necessary. The re- 
 ceipt of the goods by the vendee implies a delivery by the vendor. 
 Delivery and receipt of the goods without acceptance is insufficient, 
 and payment implies a receipt and acceptance of the consideration by 
 the party to whom it is made. Hawley v. Keeler, 53 N. Y. 114; Pit- 
 ney V. Glens Falls Ins. Co., 65 N. Y. 6, 26. While the statute does not 
 interdict the establishment of the verbal contract by parol testimony, 
 it guards against the misunderstanding, misconception, or perjury of 
 the parties by requiring proof of the mutual confirmatory act evidenc- 
 ing intelligence and finality concerning it on the part of each. A writ- 
 ing, of course, evidences the contract as to both parties. Where it is 
 omitted, but the vendee has paid part of the price or the vendor has 
 delivered and the buyer has accepted a part of the goods upon the 
 strength of the agreement, those acts furnish tinequivocal evidence of 
 the existence of a contract of some sort between them, although its 
 terms and the performance of the attesting act must after all depend up- 
 on the recollection of witnesses. The design of the statute requires 
 that neither party can create the evidence which shall prove the un- 
 written contract as against the other: Shindler v. Houston, 1 N. Y. 
 261, 49 Am. Dec. 316; Rodgers v. Phillips, 40 N. Y. 519; Hinchman 
 V. Lincoln, 124 U. S. 38, 8 Sup. Ct. 369, 31 L. Ed. 337. 
 
 The facts found by the referee in this case do not establish the con- 
 tract. Upon the part of the deceased there was merely the naked, 
 verbal agreement. He did not by any act or participation in any act 
 subsequent to it assent to or recognize or confirm it. Each act of the 
 plaintiff was individual and independent. His possession of the books, 
 if had at the time of the agreement, was not on the strength of or pur- 
 suant to it but under another and prior arrangement and, if acquired 
 subsequent to the contract, was without a delivery and through his 
 sole and exclusive act. Under either hypothesis the title of the de- 
 ceased to the books did not pass to the plaintiff by virtue of a receipt 
 and acceptance because he did no act by which he relinquished his do- 
 minion or recognized and confirmed that of the plaintiff over them. 
 Brand v. Focht, 1 Abb. Dec. 185 ; Marsh v. Rouse, 44 N. Y. 643 ; 
 Stone v. Browning, 68 N. Y. 598; Rourke v. Bullens, 74 Mass. (8 
 Gray) 549. 
 
1440 THE STATUTE OF FRAUDS (Ch. 10 
 
 Manifestly the contract was not made valid by the credit given the 
 deceased by the plaintiff and for two reasons : It was not made at the 
 time of the agreement; the deceased was not in any way an actor in 
 regard to it. Hunter v. Wetsell, 57 N. Y. 375, 15 Am. Rep. 508; 
 Brabin v. Hyde, 32 N. Y. 519; Matthiessen & Weichers Refining Co. 
 v. McMahon's Adm'r, 38 N. J. Law, 536. 
 
 The judgment should be affirmed, with costs.^^ 
 
 DRIGGS v. BUSH et al. 
 
 (Supreme Court of Michigan, 1908. 152 Mich. 53, 115 N. W. 985, 15 L. R. A. 
 [N. S.] 654, 125 Am. St. Kep. 389, 15 Ann. Cas. 232.) 
 
 Action by Hue H. Driggs against Levi Bush and another. Judg- 
 ment for plaintiff, and defendants bring error. Affirmed. 
 
 MoNTcioMERY, J. The plaintiff is a buyer of hay, and through his 
 agents. Homer B. Mfc Williams and John Van Horh, made a contract 
 with the defendants, who own and operate two farms in Van Buren 
 county, and who were the joint owners of the hay crop thereon, for the . 
 purchase of 24 tons of hay or more at the option of the defendants. 
 The contract was by parol, arid, as appears by the testimony offered 
 on behalf of the plaintiff, was as follows : "Mr. Dean said :' 'I want 
 $10 a ton and you bale the hay.' We finally bought all of the hay for 
 $10 a ton, and we to do the baling, and we were to take the hay the 
 first cars we could get a,t Gobleville after the hay was baled." The 
 testimony of the other witness for plaintiff does not vary materially 
 from this, he stating: "We were to pay him $10 a ton for it, and we 
 was to pay for the baling." It was also a part of the agreement that 
 
 23 Acceptance and receipt of any part of the goods, however small, satis- 
 fies the requirements of the statute. Morris Spirt & Co. v. Prior, 93 Conn. 
 639, 107 Atl. 513 (1919), five barrels of sugar out of tliirty-flve; Garfield 
 V. Paris, 96 U. S. 557, 24 L. Ed. 821 (1877), the labels to be pasted upon 
 bottles of liquor to be shipped later; Walker Bros. & Co. v. Daggett, 115 
 Miss. 657, 76 South. 569 (1917) ; Adams v. King (Okl.) 170 Pac. 912 (1918), 
 the statute is satisfied by delivery and acceptance of a part after the time 
 agreed upon for performance. See, in general, Williston on Sales, §§ 73-96. 
 
 Delivery of the goods to a specified carrier may satisfy the statute as to 
 receipt, but it does not operate as an acceptance of the goods, in the absence 
 of a power given by the buyer. Spedding v. Griggs, 196 Mich. 571, 162 
 N. W. 956 (1917); Caulkins v. Hellman, 47 N. T. 449, 7 Am. Bep. 461' 
 (1872). The acceptance and receipt need not be contemporaneous, and may 
 be the separate acts of different persons. Cusack v. Robinson (1861) 1 Best; 
 & S. 299. See, further, Shindler v. Houston, 1 N. Y. 261, 49 Am. Dec. 316 
 (1848); Toung v. Alexander (Miss.) 86 South. 461 (1920). 
 
 Where a shareholder in a corporation agreed to sell his shares to another 
 shareholder, acceptance antj receipt is not shown by the fact that the latter 
 shareholder took possession of the entire assets of the corporation; there 
 being no actual delivery of the existing certificates of stock. De Nunzio v. 
 De Nunzio, 90 Conn. 342, 97 Atl. 323 (1916). 
 
 "Acceptance" of goods can be shown by evidence that the buyer offered to 
 sell them to another person. Bieknell v. Owyhee Sheep Co., 31 Idaho, 696, 176 
 Pac. 782, 4 A. L. K. 897 (1918) ; Morton v. Tibbett, 15 Q. B. 428 (1850). 
 
\ 
 
 Sec. 5) CONTRACTS FOR THE SALE OF GOODS U41 
 
 the defendants were to draw the hay to Gobleville and place the same 
 on boardcars. After the contract was made, the plaintiff sent balers to 
 the premises of the defendants who baled the hay, the defendants being 
 present and assisting in the work. The price paid for baling the hay 
 was $1.10 per ton, or $33.55, that being the regular price for such serv- 
 ices. The defendants subsequently refused performance of the con- 
 tract, and this action was brought to recover damages for the breach. 
 Plaintiff was permitted to recover below the difference between the 
 purchase price of the hay and its actual market price at the date when 
 delivery was contemplated. Defendants bring error, and contend that 
 the contract was void under the statute of frauds, and :has never been 
 validated, and this presents the principal question for our considera- 
 tion. 
 
 ^^ Our statute of frauds (Comp.' Laws 1897, § 9516) reads as follows: 
 "No contract for the sale of any goods, wares or merchandise for the 
 price of fifty dollars or more, shall be valid, unless the purchaser shall 
 accept and receive part of the goods sold, or shall give something in 
 earnest, to bind the bargain or in part payment, or unless some note or 
 memorandum in writing of the bargain be made, and signed by the par- 
 ty to be charged thereby or by some person thereunto by him lawfully 
 authorized." 
 
 It is obvious that at the time this contract was made there was no 
 such delivery or part payment as satisfied the terms of this statute. 
 But as this statute does not require the payment or acceptance to be 
 at the time of the making of the contract, as is the case in New York 
 and some other states (see Mechem on Sales, § 419), it is competent for 
 the parties to validate their contract by any act which amounts to a de- 
 livery and acceptance or to a payment. The circuit judge Was of the 
 opinion that when the hay was baled by the plaintiff's agents upon the 
 premises of the defendants and with their co-operation, this constituted 
 such a delivery and acceptance as would answer the requirements of 
 the statute of frauds. 
 
 It is strenuously insisted that there was no such delivery or accept- 
 ance, and plaintiff's counsel do not seek to maintain that there was. 
 Without passing directly upon the qu'estion, therefore, in this case, we 
 may assume that there was no such complejied delivery as the stat- 
 ute requires, and that the defendants still retained the title to the prop- 
 erty after the same was baled. We are not concerned with the correct- 
 ness of the reasoning of the circuit judge if the correct result was 
 reached. The question occurs, therefore, whether the expenditure of 
 $1.10 per ton upon this hay, which remained the property of the de- 
 fendants, which expenditure was received and accepted by them, and 
 was made in pursuance of the contfact between the parties, was such 
 a part payment as answered the requirements of the statute. It is con- 
 tended that the thing in earnest must be actually paid, and received 
 by the seller. This we fully accept. But there can be no doubt in this 
 
 COKBIN CONT 91 
 
1442 THE STATUTE OP FRAUDS (Ch. 10 
 
 case that the service of baling this hay was received and accepted by 
 these defendants, and if this was done at a time while the hay remained 
 their property, and such service was received in pursuance of the con- 
 tract made between the parties, we can conceive of no valid objection 
 to treating this as a part payment of the consideration which was to 
 pass from the plaintiff to the defendants at a time prior to the passing 
 of the title of the hay to plaintiff. This being so, there has been a 
 payment by the plaiiTtiff and a receipt by the defendants of a part of the 
 consideration. It was the hay in its improved form as baled hay 
 which, according to the theory of the defendants, was to pass from 
 the defendants to the plaintiff, and if this be accepted as true, which it 
 doubtless is, it cannot be successfully contended that the defendants 
 have not received the value of services performed by the plain- 
 tiff in pursuance of this contract. Suppose this agreement had been 
 on the part of the plaintiff to pay a stated price for this hay when 
 baled and delivered, and at the same time to thresh defendants' oats 
 on the farm. The contract would not be materially different. In the 
 one case, as in the other, plaintiff is performing a service for defend- 
 ants which increases the value of their property. It was not necessary 
 that the payment made upon the contract be in money. See Kuhns 
 V. Gates, 92 Ind. 66; Howe v. Jones, 57 Iowa, 130, 8 N. W. 451, 10 
 N. W. 299 ; Mclvure v. Sherman (C. C.) 70 Fed. 190. Defendants 
 rely upon Corbett v. Woolford, 84 Md. 426, 35 Atl. 1088, Terney v. 
 Doten, 70 Cal. 399, 11 Pac. 743, Galbraith v. Holmes, 15 Ind. App. 
 34, 43 N. E. 575, and Hudnut v. Wier, 100 Ind. 501, which was again 
 before the court as Weir v. Hudnut. 115 Ind. 525, 18 N. E. 
 24 34 * * * 
 
 Judgment affirmed.^'' 
 
 3* The court then proceeded to distinguish these cases relied on by the 
 defendant. 
 
 35 Where several items are Included in a single contract of sale, a pay- 
 ment on account makes the oral contract enforceable as to every item. 
 Berwin v. BoUes, 183 Mass. 340, 67 N. E. 323 (1903). 
 
 A payment by check satisfies the statute, if the cheek operates as an 
 extinguishment of the debt even before it is cashed. Parker v. Crisp, [1919] 
 1 K. B. 481, Summers v. Wood, 131 Ark. 345, 198 S. W. 692 (191T). But 
 otherwise if it is only the cashing of the check that extinguishes the duty 
 to pay. Bates v. Dwlnell, 101 Neb. 712, 164 N. W. 722, L. R. A. 1918B, 900 ; 
 and see, also. Walker v. Nussey, 16 M. & W. 302 (1847). See, also, Hunter v. 
 Wetsell, 84 N. T. 549, 38 Am. Rep. 544 (1881). 
 
 The plaintiff sold 10,000 bags of sugar to defendant at the market price 
 on August 3, on the latter's oral promise to sell the plaintiff a like amount 
 at the same price on demand within 10 days ; it was held that the delivery 
 of the first lot of sugar was not a part payment, maldng the defendant's oral 
 promise enforceable. De Waal v. Jamison, 176 App. Div. 756, 163 N. Y. 
 Supp. 1045 (1917). 
 
 Where the buyer sends money to the seller by mail, and the letter is duly 
 received, this does not constitute a payment, unless the seller assents to it 
 as such. Edgerton v. Hodge, 41 Vt. 676 (1869). 
 
Sec. G) THE CHARACTER OF THE MEMORANDUM REQUIRED 1443 
 
 SECTION 6.-^THE CHARACTER OF THE MEMORANDUM 
 
 REQUIRED 
 
 SANBORN et al. v. FLAGLER. 
 (Supreme Judicial Court of Massacliusetts, 1864. 9 Allen, 474.) 
 
 Contract, brought originally by the plaintiffs, who were partners un- 
 der the firm of Sanborn, Richaa-dson & Co., against John H. Flagler 
 and - — I — - Holdane, as partners under the firm of Holdane & Co. 
 The writ was served only upon Flagler, and he alone appeared to de- 
 fend the action. The plaintiffs alleged that the defendants had refused 
 to deliver to them fifty tons of best refined iron, in accordance with 
 the terms of a written agreement entered into between them. 
 
 The defendant in his answer set up, among other defences, the 
 statute of frauds. 
 
 At the trial in the superior court, before Morton, J., Josiah B. Rich- 
 ardson, one of the plaintiffs, was called to the stand, and produced, to 
 be offered in evidence, a paper, of which the following is a copy as 
 near as can be made: 
 
 "Will deliver S. R. & Co. Best Refined Iron 50 tons within 90 days— 
 at 5 ct p lb 4 of cash. Plates to be 10 to 16 inches wide and 9 ft to 11 
 long. This offer good till 2 o'clock Sept, U, 1862. J. H. F. J. B. R." 
 
 The witness was proceeding to testify in relation to the execution and 
 delivery of the same, when the defendant objected that the paper was 
 not on its face or in fact any sufficient note or memorandum in writing 
 of the alleged bargain signed by the party to be charged, and that 
 parol evidence was not admissible to add to, modify or explain the 
 paper, so as to make it such a memorandum as could be admitted. ' But 
 the judge ruled that the paper was a sufficient nofe or memorandum 
 under the .statute, and would bind the defendant if he was a member 
 of the firm of Holdane & Co. The witness then testified that the agree- 
 ment was written by him, and that he and the defendant signed their 
 initials, the defendant writing the initials "J- H. F." and he the initials ' 
 "J. B. R.," and that before two o'clock on the day named, and before 
 the defendant left the plaintiff's office, he accepted the proposition, 
 and so stated to the defendant verbally. The witness also testified that 
 he signed his initials on behalf of the plaintiffs, and that he under- 
 stood the defendant to sign for the firm of Holdane & Co. This evi- 
 dence was not controverted by the defendant. 
 
 The judge ruled that said paper, with the explanations given, if 
 Richardson was believed, was a sufficient note or memorandum, and 
 was binding on the defendant, if the jury found him to be a partner 
 as alleged. 
 
1444 THE STATUTE OF FRAUDS (Ch. 10 
 
 The jury found a verdict for the plaintiffs, and the defendant al- 
 leged exceptions. 
 
 BiGELOw, C. J. The note or memorandum on which the plaintiffs 
 rely to maintain their action contains all the requisites essential to 
 constitute a binding contract within the statute of frauds. It is not de- 
 nied by the defendant that a verbal acceptance of a written offer to 
 sell merchandise is sufficient to constitute a complete and obligatory 
 agreement, on which to charge the person by \vhom it is signed. In 
 such case, if the memorandum is otherwise sufficient when it is assent- 
 ed to by him to whom the proposal has been made, the contract is con- 
 summated by the meeting of the niinds of the two parties, and the evi- 
 dence necessary to render it valid and capable of enforcement is sup- 
 plied by the signature of the party sought to be charged to the offer to 
 sell.^° Indeed, the rule being well settled that the signature of the 
 defendant only is necessary to tnake a binding contract within the pro- 
 visions of the statute relating to sales of merchandise, it necessarily 
 follows that an offer to sell and an express^ agreement to sell stand oh 
 the same footing, inasmuch as the latter, until it is accepted by the 
 other party, is in effect nothing rnore than a proposition to sell on the 
 terms indicated. The acceptance of the contract by the party seeking 
 to enforce it may always be proved by evidence aliunde. 
 
 The objections on which the defendants rely are twofold. The first 
 is, that the note or memorandum does not set forth upon its face, in 
 such manner as to be understood, by the court, the essential elements of 
 a contract. But this position is not tenable. The nature and descrip- 
 tion of the merchandise, the quantity sold, the price to be paid there- 
 for, the terms of payment and the time within which the article was 
 to be delivered, are all clearly set forth. But it is urged that the paper 
 does not discldse which of the parties is the purchaser and which the 
 seller, and that no purchaser is in fact named in the paper. This 
 would be a fatal objection, if well founded. There can be no contract 
 
 3« In accord: Reuss v. Picksley, L. R. 1 Ex. 342 (1866); Mason v. 
 Decker, 72 N. Y. 595, 28 Am. Rep. 190 (1878) ; Lydig v. Braman, 177 Mass. 
 212, 58 N. E. 696 (1900) ; Gradle v. Warner, 140 111. 123, 29 N. E. 1118 
 (1892) ; Austrian & Co. v. Springer, 94 Mich. 348, 54 N. W. 50, 34 Am. St. 
 Rep. 350 (1892). 
 
 A memorandum signed by one party only may be sufficient in case the 
 party so signing is the party to be charged — the party now repudiating the 
 contract ; mutuality in this respect is not required. Justice t. Lang, 42 N. Y. 
 493, 1 Am. Rep. 576, Id., 52 N. Y. 323 (1873) ; .Tones v. School Dist. No. 48 
 of Lawrence County, 137 Ark. 414, 208 S. W. 798 (1919) ; Jaeger v. Shea, 
 130 Md. 1, 99 Atl. 954 (1917) ; Himrod Furnace Co. v. Cleveland & M. R. 
 Co., 22 Ohio St. 451 (1872). Cf. Kerr v. Finch, 25 Idaho, 32, 135 Pae. 1165 
 (1913). 
 
 In Wright v. Seattle Grocery Co., 105 Wash. 383, 177 Pac. 818 (1919), the 
 following memorandum, delivered to Wright, was held sufficient to bind the 
 Grocery Company, although its name was merely printed at the top: "Seattle 
 Grocery Company (Ineoi-porated) Corner Western Avenue and Columbia 
 Street. Phone Main 842. Seattle, Wash., April 6, 1917. Sold to Chauncey 
 Wright, L. C. Smith Bldg., Seattle, Wash., CofEee, Spices, 'Halcyon' Food 
 Products, 1 car Gold Medal flour, $2,790.46." 
 
Sec. 6) THE CHARACTER OF THE MEMORANDUM REQUIRED X445 
 
 or valid memorandum of a contract, which does not show who are 
 the contractmg parties. But there is no such defect in the note or 
 memorandum held by the plaintiffs. The stipulation is explicit to de- 
 liver merchandise to S. R. & Co. It certainly needs no argument to 
 demonstrate that an agreement to deliver goods at a fixed price and 
 on specified terms of payment is an agreement to sell. Delivery of 
 goods at a stipulated price constitutes a sale ; an agreement for such 
 delivery is' a contract of sale. Nor can there be. any doubt raised as to 
 the intrinsic import of the memorandum concerning the character or 
 capacity in which the parties are intended to be named. A stipulation 
 to deliver merchandise to a person clearly indicates that he is the pur- 
 chaser, because in every valid sale of goods delivery must be made by 
 the vendor to the vendee. We can therefore see no ambiguity in the 
 insertion of the name of the purchaser or seller. The case is much 
 stronger in favor of the validity of the memorandum, in this respect, 
 than that of Salmon Falls Manuf. Co. v. Goddard, 14 How. 446, 14 
 Iv. Ed. 493. There only the names of the parties were inserted, with- 
 out any word to indicate which was the buyer and which was the sell- 
 er. It was this uncertainty in the memorandum which formed the main 
 ground of the very able dissenting opinion of Mr. Justice Curtis in 
 that case. So in the leading case of Bailey v. Ogden, 3 Johns. 399, 3 
 Am. Dec. 509 ; there was nothing in the memorandum to show which 
 of the two parties named agreed to sell the merchandise. But in the 
 case at bar, giving to the paper a reasonable interpretation, as a brief 
 document drawn up in the haste of business, and intended to express 
 in a few words the terms of a bargain, we cannot entertain a doubt 
 that it indicates with sufficient clearness that the plaintiffs were the 
 purchasers and the defendant the seller of the merchandise, on the 
 terms' therein expressed. Indeed, we can see no reason why a written 
 agreement by one party to deliver goods to another party does not as 
 clearly show that the latter is the purchaser and the former the seller 
 as if the agreement had been in express terms by one to sell goods to 
 the other.^^ 
 
 The other objection to the memorandum is, that the n^me of the 
 party sought to be charged does not appear on the face of the paper. 
 If by this is meant that the signatures of all the persons who are nam- 
 ed as defendants are not affixed to the memorandum, or that it is not 
 signed with the copartnership name under which it is alleged that the 
 persons named as defendants do business, the fact is certainly so. 
 But it is not essential to the validity of the memorandum that it should 
 be so signed. An agent may write his own name, and thereby bind 
 
 37 Di Santis v. Oannata (E. I.) 105 Atl. 561 (1919) ; Grafton v. Gum- 
 mines 99 U. S. 100, 25 L. Ed. 366 (1878) ; Mentz v. Newwitter, 122 N. Y. 
 491 ^5 N E 1044, 11 L.R. A. 97, 19 Am. St. Rep. 514 (1880). But the 
 iPtt'er' addressed to a third party is suiflcient if it contains the required 
 nami and terms. Peabody v. Speyers, 56 N. Y. 230 (1874) ; Spangler v. 
 Danforth, 65 111. 152 (1872). 
 
1446 THE STATUTE OF FRAUDS (Ch. 10 
 
 his principal; and parol evidence is competent to prove that he signed 
 the memorandum in his capacity as agent.^^ On the same principle, a 
 partner may by his individual signature bind the firm, if the contract 
 is within the scope of the business of the firm, which may be shown 
 by extrinsic evidence. Soames v. Spencer, 1 D. & R. 32; Long on 
 Sales, 38 ; Browne on St. of Frauds, § 367 ; Higgitts v. Senior, 8 M. 
 & W. 834 ; Williams v. Bacon, 2 Gray, 387, 393. Besides, in the case 
 at bar, the action is in effect against Flagler alone. He only has been 
 served with process and appears to defend the action. Whether he 
 signed as agent for the firm or in his individual capacity is immaterial. 
 In either aspect, he is liable on the contract. 
 
 It is hardly necessary to add that the signature is valid arid binding, 
 though made with the initials of the party only, and that parol evi- 
 dence is admissible to explain and apply them. Phillimore v. Barry, 1 
 Camp. 513; Salmon Falls Manuf. Co. v. Goddard, ubi supra; Barry 
 V. Coombe, 1 Pet. 640, 7 L. Ed. 295.' 
 
 Exceptions overruled. 
 
 KILDAY V. SCHANCUPP. 
 
 (Supreme Court of Errors of Connecticut, 1916. 91 Conn. 29, 98 Atl. 335, 
 L. R. A. 1917A, 151.) 
 
 Action by Annie Kilday against Jacob Schancupp. Judgment for 
 plaintiff, and defendant appeals. Affirmed. 
 
 On August 5, 1914, the plaintiff orally agreed to sell the defendant 
 the two lots, 38 and 40 Emmett avenue, in Derby, Conn., for $4,350, 
 payable, $50 in cash, the assumption of a mortgage for $2,000 upon 
 the property, and a note for $1,500 secured by a second mortgage 
 on the property, and the balance in cash at delivery of deed on or before 
 September 1, 1914. In the afternoon of this day the defendant pre- 
 ss in accord: Donahue v.Rafferty, 82 W. Va. 535, 96 S. B. 935 (1918) ; 
 Union Bag & Paper Corporation v. Bischofe (D. C.) 255 Fed. 187 (1918) ; 
 Tobin V. Larkin, 183 Mass. 389, 67 N. E. 340 (1903) ; Sholovitz v. Noori- 
 gian (E. I.) 107 Atl. 94 (1919). A few states have statutes requiring tne 
 agent to have written authority. 
 
 A common agent may be authorized to sign for both parties ; but it is well 
 settled that one party cannot sign as agent for the other and thus satisfy 
 the statute. Woodruff Oil & Fertilizer Co. v. Portsmouth Cotton Oil Refin- 
 ing Corp., 246 Fed. 375, 158 0. C. A. 439 (1917) ; Bent v. Cobb, 9 Gray 
 (Mass.) 397, 69 Am. Dec. 295 (1857) : Asbury v. Mauney, 173 N. G. 454, 92 
 S. B. 267 (1917) ; O'Donnell v. Leeman, 43 Me. 158, 69 Am. Dec. 54 (1857) ; 
 Johnson v. Dodge, 17 111. 433 (1856) ; Browne, Statute of Frauds, §§ 367-370; 
 Wright V. Dannah, 2 Camp. 203 (1809). 
 
 The memorandum of an auctioneer made at time of the sale binds both 
 pai-ties. Martin v. Mathis, 184 Ky. 20, 211 S. W. 198 (1919). His power 
 to bind the seller lasts a reasonable time after the sale. White v. Dahlqulst, 
 179 Mass. 427, 60 N. B. 791 (1901) ; Sweeney v. Brow, 35 R. I. 227, 86 
 Atl. 115, Ann. Cas. 19150, 1075 (1913). 
 
Sec. 6) THE CHARACTER OP THE MEMORANDUM REQUIRED 1447 
 
 toTheMli*' ^^''"''^ ""^ '■'•1"'''"^ ^'' ^'§"^t«^^' ^hich She made, 
 to the following instrument : 
 
 "J- Schancupp, Dealer in Diamonds/ Watches and Jewelry, 222 
 
 Main Street. 
 
 "c:„i J .TO, ^ "Derby, Conn., Aug. 5, 1914. 
 
 ^ 1 ; .^ I' Sclian<^upP #38-40 Emmett avenue three tenement house 
 and lot 50 front by ISO deep, and one empty lot 50 by 150, next to 
 second house for the sum of forty-three hundred and fifty dollars. 
 Received by check deposit on the above $50.00, same to apply to pur- 
 chase price. Assuming mortgage of $2,000 held by the Derby Savings 
 Bank, and agree to take a second mortgage of $1500.00 for thtee years 
 at 5%. Balance of purchase price to be paid in cash on delivery of 
 deeds. Deeds to pass hands on or before the first of September, 1914. 
 
 " [Signed] Mrs. Annie Kilday. 
 In the presence of 
 
 "Etta Kilday. 
 "S. Iviftig." 
 
 The defendant directed his daughter to make a copy of this paper 
 and give the same to the plaintiff. He himself kept the original, and 
 did not sign it, unless his name in the body of the instrument is held 
 to be a signing. The defendant at the delivery of the instrument to 
 him gave the plaintiff his check for $50, written as follows : 
 "Deposit on house and extra lot. 
 "Birmingham National Bank, Derby, Conn., 
 
 "Aug. 5, 1914. 
 "Pay to the order of Mrs. Kilday fifty and 00/100 dollars. 
 
 "J Schancupp." 
 — and the plaintiff cashed this. On August 6, 1914, the defendant 
 told the plaintiff he did not intend to buy the property. On August 
 31, 1914, the plaintiff tendered the defendant a warranty deed of the 
 premises and the mortgage deed required to be executed by him in 
 accordance with said instrument, and requested the payment of the 
 balance of the purchase price and the performance by the defendant 
 of his part of the agreement. This the defendant refused to do, and 
 declined to accept the deed. On August 5, 1914, plaintiff, believing she 
 had sold her property to the defendant, moved out of the house and 
 lived elsewhere for eight months. She then returned and resumed 
 possession. On August 5, 1914, the plaintiff's property, which defend- 
 ant agreed to pay $4,350 for was worth $4,000. 
 
 Wheeler, J. (after stating the facts as above) . The trial court ■ 
 held that there was no sufficient memorandum in writing to support a 
 decree for specific performance, but that the plaintiff was entitled to 
 a judgment for damages based upon the agreement for the sale of land. 
 General Statutes, § 1089, provides that: 
 
 "No civil action shall be maintained * * * upon any agreement 
 for the sale of real estate, or any interest in or concerning it * * * 
 
1448 THE STATUTE OF FRAUDS (Ch. 10 
 
 unless such agreement, or some memorandum thereof, be made in writ- 
 ing, and signed by the party to be charged therewith, or his agent." 
 
 We have said that our statute does not make agreements not made in 
 this way invalid, but prevents their proof unless by such a' writing. 
 Fisk's Appeal, 81 Conn. 433, 438, 71 Atl. 559. 
 
 . It is immaterig.1 whether the action be one for specific performance, 
 or for darnages for the breach of a contract of sale of land. The proof 
 must be in the manner provided by our statute. And the agreement, in 
 its essentials, rnu^t be the same in either action. Lord Farwell suc- 
 cinctly stated the principle in Wild v. Woolwich Borough Council, 1 
 Ch. Div. 35, 42: "It is perfectly clear that if there was no contract, 
 there can be no damages for breach of contract, and any claim to 
 compensation is out of the question." 
 
 But before specific performance will be decreed, something further 
 must be shown than that the contract is made in accordance with the 
 requirements of law. . It must, in addition, be one of such a character 
 as that the court will enforce its performance. The governing prin- 
 ciples are clearly specified in our decisions. Patterson v. Bloomer, 
 35 Conn. 57, 63, 95 Am. Dec. 218; Piatt v. Stonington Savings Bank, 
 46 Conn. 476, 478. 
 
 The conclusion of the learned trial court is not necessarily erroneous, 
 though the reason given may be. 
 
 If the memorandum by which the agreement was proved meets the 
 requirements of the statute, a contract within the requirements of the 
 statute has been established sufficient to support the action for damages, 
 or the action;'to secure specific performance, in the absence of equitable 
 considerations which would lead a court in the exercise of its discretion 
 to refuse to issue its decree. 
 
 The memorandum upon which the case must stand or fall is Exhibit 
 B. When analyzed it discloses the parties to a contract of sale of land, 
 the subject of sale described, a consideration, the terms of the sale, and 
 the time of delivery of the deed. When the agreement was oifered in 
 evidence, the defendant duly excepted to its admission. 
 
 In two particulars only does the appellant attack the agreement: 
 (1) Because of indefiniteness ; (2) because it was not signed by the 
 defendant. '"• ■ ■ 
 
 The claimed indefiniteness of this agreement rests upon the descrip- 
 tion of the subject of the sale, viz. — "# 38-40 Emmett avenue three 
 tenetnent house and lot 50 front by ISO deep, and one empty lot 50 by 
 150 next to second house." 
 
 In the body of the agreement the locality of Emmett avenue is not 
 given. But the agreement bears date at Derby, Conn., and from this 
 the inference of fact follows, in the absence of evidence to the contrary, 
 that the property described in the agreement is located in Derby^ Conn. 
 This inference is rebuttable by parol proof, for exaniple, that there was 
 no such avenue or street in Derby. Mead v. Parker, US Mass. 413, 
 415, 15 Am. Repj 110; Kraft et al. v. Egan, 76 Md. 243, 252, 25 Atl. 
 
Sec. 6) THE CHARACTER OF THE MEMORANDUM REQUIRED 1449 
 
 Tm7 ^^^T^^ V. Foster, 87 Conn. 90, 97, 87 Atl. 35, Ann. Cas. 1914C, 
 lUU/, Hodges V. Kowmg, 58 Conn. 20, 21, 18 Atl. 979 7 L R A 87 »» 
 _ The agreement must: have been signed by this defendant, since he 
 IS the party to be charged. This agreement was caused to be prepared 
 by the defendant, and it begins, "Sold to J. Schancupp." This is the 
 written declaration of the defendant himself that the plaintiff has 
 sold him the property described upon the terms described, and likewise 
 It is 'his written declaration of purchase of this property upon the 
 named terms. The statute is intended to relieve against fraud. To 
 hold that this defendant by writing his name in the body of this instru- 
 ment instead of at its end did not sign the instrument would help 
 perpetrate, instead of prevent, a wrong. 
 
 An instrument, signed by one in any part of it after the body of it is 
 written, or signed in any part and when completed produced from his 
 custody, must be taken to be the instrument of th^arty so signing. 
 Under these circurnstances he authenticates by his signature, or by the 
 signature to the instrument produced from his custody, the instrument 
 so signed, and such a signature fully meets the requirements of the 
 statute of frauds. New England, etc., Co. v. Stand. Worsted Co., 165 
 Mass. 328, 331, 43 N. E. 112, 52 Am. St. Rep. 516; Penniman v. 
 Hartshorn et al, 13 Mass. 87; Cal. Canneries Co. v. Scatena, 117 Cal. 
 447, 49 Pac. 462; Drury et al. v. Young, 58 Md. 553, 42 Am. Rep. 
 343.*° 
 
 The authorities are equally decisive that the signature may be print- 
 ed or written. Schneider v. Norris, 2 M. & S. 286; Drury et al. v. 
 
 3 8 The description must identify the property sold. Doherty v. Hill, 144 
 Mass. 465, 11 N. E. 581 (1887) ; Ryan v. TJnited States, 136 U. S. 68, 10 Sup'. 
 Ct. 913, 34 r,. Ed. 447 (1889) ; Fortesque v. Crawford, 105 N. O. 29, 10 S. E. 
 910 (1890). But parol evidence is admissible to show the application of the 
 description to the facts. An informal memorandum was held to describe the 
 property suflBciently in Sholovitz v. Noorigian (R. I.) 107 Atl. 94 (1919) ; 
 Desmarais v. Taft, 210 Mass. 560, 97 N. E. 96 (1912), "for a piece of land 
 next to P., 70 feet on the road and bact to an old wall" ; Eyder v. Loomis», 
 161 Mass. 161, 36 N. E. 836 (1894), "my right in my father's estate"; Tobin 
 V. Larkin, 183 Mass. 389, 67 N. E. 340 (1903) ; Auerbaeh v. Nelson, [1919] 
 2 Ch. 383; Anderson v. Hall (Mo.) 188 S. W. 79 (1916), "the Joe Shelby 
 farm, * * * an 800-aere farm near A.'' ; Miller v. Dargan, 136 Ark. 237, 
 206 S. W. 319 (1918). The description was held insuflBcient in Howard- & 
 Co. V. Innes, 253 Pa. 593, 98 Atl. 761 (1916) ; Denison-Gholson Dry Goods 
 Co. V. Hill, 135 Tenn. 60, 185 S. W. 723 (1916) ; Burley- Winter Pottery Co. 
 V. Onken Bros. & West Co., 26 Wyo. 287, 183 Pac. 747 (1919), description of 
 goods; Rogers v. Lippy, 99 Wash. 312, 169 Pac. 858, L. R. A. 19180, 583 
 (1918), "my stock ranch located in sections 9, 17, and 21, Tp. 3 S., R. 13 E., 
 Sweetgrass county, Mont." — see dissent. 
 
 *oin accord: Higdon v. Thomas, 1 Har. & G. (Md.) 139 (1827) ; Evans 
 V. Hoare, [1892] 1 Q. B. 593; Clason's Ex'rs v. Bailey, 14 Johns. (N. Y.) 
 484 (1817) ; Salmon Falls Mfg. Co. v. Goddard, 14 How. 446, 14 L. Ed. 493 
 (1852). 
 
 If the name is written in the body of the instrument solely to identify 
 the party, and not as an authenticating signature, with the intention that the 
 instrument shall become operative only when duly signed later, the memo- 
 randum does not satisfy the statute. Sutherland v. Munsey, 119 Va. 791, 89 
 S. E. 882 (1916). 
 
1450 THE STATUTE OF FRAUDS ' (Ch. 10 
 
 Young, 58 Md. 554, 42 Am. Rep. 343. And we have held that a sig- 
 nature by a rubber stamp, made by an agent duly authorized, is a sig- 
 nature within the statute. Deep River Nat. Bank's Appeal, 73 Conn. 
 341, 346, 47 Atl. 675. 
 
 Exhibit B was properly admitted in evidence ; it was not indefinite, 
 and it was duly signed by the defendant. 
 
 No facts are found which would prevent a court of equity decree- 
 ing specific performance. Therefore the trial court would have' been 
 justified in decreeing specific performance, and was justified in render- 
 ing a judgment for damages upon the second prayer for relief. 
 
 There is no error. The other Judges concurred. 
 
 EACKARD V. RICHARDSON et al. 
 
 (Supreme Judicial Court of Massachusetts, 1821. 17 Mass. 122, 9 Am. 
 
 Dec. 123.) 
 
 Assumpsit by the endorsee of a promissory note, made by the Stony ' 
 Brook Manufacturing Company, of which the defendants were mem- 
 bers. 
 
 Parker, C. J.*^ * * * 'j^jjg original promise is, by the Stony 
 Brook Manufacturing Company, by a note payable on demand. Aft- 
 er the making of the note, and after it was endorsed to the present 
 plaintiff, the defendants severally signed their names on the back, and 
 over their signatures were written these words: "We acknowledge 
 ourselves holden as surety for the payment of the within note." The 
 consideration existing was, that these defendants were members of 
 the company which made the note ; and that a suit, whicn had been 
 commenced, was stopped by the . plaiiitiff, ' at their request. But this 
 consideration was proved by parole, and the writing acknowledges no 
 consideration whatever. 
 
 It is somewhat remarkable that a statute, which has so important 
 a bearing upon contracts in daily use, should have rem.ained without 
 the construction recently given to it, from the time of its enactment, 
 which was in the 29 Car. 2, to the year 1804, when the case of Wain 
 V. Warlters was decided. That it did so remain will appear from the 
 circumstance, that neither the counsel in arguing that case, nor the 
 Court in deciding it, refer to any preexisting case in support of their 
 doctrine ; a doctrine which, when announced, excited much surprise 
 both in England and in this country. 
 
 Our provincial act was passed in the year 1692, [Prov. Laws 1692- 
 93, c. IS,] and continued in force until the year 1788, when it was 
 superseded by the statute of the commonwealth, which, as well as the 
 provincial act, is similar in substance, and, except in one instance 
 where the sense is not altered, is copied verbatim from the English 
 
 *i The statement of facts is condensed and parts of the opinion are omitted. 
 
\ 
 
 Siec. 6) THE CHAEACTBE OF THE MBMOBANDUM RBQTJIEED 1451 
 
 Statute. So that we have had the statute in operation more than a 
 century, within which period innumerable collateral engagements 
 have been made, and it has never, until within a few years, as far as 
 we can ascertam, been doubted that, if one man, for a sufficient con- 
 sideration, deliberately signed his name to a promise to pay the debt 
 of another, he would be bound by it, although no consideration what- 
 ever was mentioned in the writing which he signed. 
 
 Although some consideration must exist to give validity to such a 
 promise, it is generally of a nature not to be disputed; and if dis- 
 puted, has been proved by parole testimony. The consideration need 
 not be for the benefit of the party making the promise, and it seldom 
 IS for his benefit; forbearance to sue, or the surceasing of a suit, 
 being most frequently the consideration of such undertakings, and 
 these being aUogether for the benefit of the original debtor. This 
 being the case, it would seldom, if ever, enter into the imaginations 
 of the parties to such a contract, that, unless the motives and consid- 
 erations, which led to it, were put down in writing, the engagement 
 was void. 
 
 Having made these preliminary remarks, I shall proceed to con- 
 sider the statute, and what is its most obvious construction, without 
 reference to decided cases; and then take a view of the decisions 
 which have been had upon it, both in England and in this country. 
 
 The first section of our Statute of 1788, c. 16, corresponds, as has 
 been observed, exactly with the fourth section of the Statute of 29 
 Car. 2. Exclusive of other subjects provided for in the same section, 
 it enacts, "That no action shall be brought, * * * whereby to 
 charge the defendant, upon any special promise, to answer for the 
 debt, default or misdoings of another person, .* * * unless the 
 agreement, upon which such action shall be brought, or some memo- 
 randum, or note thereof, shall be in writing, and signed by the party, 
 to be charged therewith, or some person thereunto by him lawfully 
 authorized." 
 
 The obvious purpose of the t^egislature would seem to be to pro- 
 tect men from hasty and inconsiderate engagements, they receiving 
 no beneficial consideration; and against a misconstruction of their 
 words by the testimony of witnesses, who would generally be in the 
 employment and under the influence of the party wishing to avail 
 himself of such engagements. To remove this mischief, the promise 
 or engagement shall be in writing,. and signed; in order that it may 
 be a deliberate act, instead of the efifect of a sudden impulse, and may 
 be certain in its proof, instead of depending upon the loose memory 
 or biased recollection of a witness. The agreement shall be in writing 
 —what agreement ? The agreement to pay a debt, which he is under 
 no moral or legal obligation to pay, but which he shall be held to pay, 
 'f he agrees to do it, and signs such agreement. 
 
 This appears to be the whole object and design of the Legislature ; 
 and this is effected, without a formal recognition of a consideration ; 
 
1452 THE STATUTE OF FRAUDS (Ch. 10 
 
 which, after all; is more of a technical requisition, thaft a substantial 
 ingredieiit in this sort of contracts. And it would seem, further, that 
 the Legislature chose to prevent an inference that the whole contract 
 or agreement must be in writing ; for it is provided that some memo- 
 randum or note thereof in writing shall be sufficient. What is this but 
 to say, that if it appear by a written memorandum or note, signed 
 by the party, that he intended to become answerable for the debt of 
 another, he shall be bound ; otherwise not ? 
 
 How then is it possible, with these expressions in the statute, to 
 insist upon a formal agreement, cdntaining all the motives or induce- 
 ments which influenced the party to become bound? Yet such is the 
 decision of the Court of King's Bench, in "the case of Wain v. 
 Warlters; 
 
 But in a case happening in the same court a short time afterwards, 
 on anothef section of the same statute, a different construction is 
 adopted. By the seventeenth section of the British statute, and the 
 second section 6f our own, it is provided, "That no contract for the 
 sale of any goods, wares or merchandise, for the price of ten pounds or 
 more, shall be allowed to be good, except the purchaser shall accept 
 part of the goods so sold, and actually receive the same, or give some- 
 thing in earnest to bind the bargain, or in part payment, 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 authorized." Yet in the case of Egerton v. Mat- 
 thews it was decided that a memorandum, containing only one side of 
 the bargain, and without any consideration expressed, was sufficient. 
 When this case came before Lord EHenborough, at nisi prius, he 
 thought it governed by the case of Wain v. Warlters; and it is cer- 
 tainly difficult to perceive a difference between the two cases. 
 
 If the word "agreement" imports a mutual act of two parties, surely 
 the word "bargain" is not less significative of the consent of two. In 
 a popular sense, the former word is frequently used as declaring the 
 engagement of one only. A man may agree to pay money or to per- 
 form some other act; and the word is then used synonymously with 
 "promise" or "engage." But the word "bargain" is seldom ^used, 
 unless to express a mutual contract or undertaking. If then the tech- 
 nical meaning of the word "agreement" made it necessary to insert 
 the consideration in a collateral promise to pay, why not the word 
 "bargain" also, as 'Lord EHenborough at first supposed? But the 
 court. Lord EUenborbugh consenting, overruled the decision at hiSi 
 prius, and decided that a contract for the sale of goods was valid 
 without any consideration expressed in the contract. 
 
 There are certainly grottrids to suppose that some doubts began to 
 be efttertaiiied of the correctness of the decision in Wain v. Warlters. 
 We cannot otherwise account for the unwillingness to apply the same 
 principle to the case of Egerton v. Matthews; and we shall see here- 
 
Sec. 6) THE CHAEACTEE OF THE MBMOEANDUM EEQUIEED 1453 
 
 after, that there was considerable cause for the Court of King's Bench 
 to liesitate, before they applied the rule to other cases * * * 
 
 forThe%SffT-"' "'""'' *'' '"''"'"^ '''' '''' ^■"'^-^'^^ 
 
 MARKS V. COWDIN et al. 
 (Court of Appeals of New York, 1919. 226 N. Y. 138, 123 N. E. 139.) 
 
 Action by Leon Marks against John E. Cowdin and another. From 
 a judgment of the Appellate Division (175 App. Div. 700, 162 N. Y 
 Supp. 567) reversing a judgment in favor of the plaintiff and dis- 
 missmg the complaint, plaintiff appeals. Reversed, 'and new trial 
 granted. 
 
 Cardozo, J. The action is one by employe against employer for 
 wrongful discharge. 
 
 The plaintiff entered the defendants' service in 1910. The defend- 
 ants wrote him that his employment was to continue for two years 
 from January 1, J91I, at an annual salary of $15,000. The hope was 
 expressed that at the end of the term he might be accepted as a part- 
 ner. He was given the privilege of starting his employment earlier if 
 he pleased. In point of fact, he did stairt it in July, 1910. He took 
 the place of another man, then leaving the defendants, who had acted 
 as general manager. At once, the defendants gave written notice to 
 their salesman. They wrote that the plaintiff was about to join their 
 staff. "He will become our sales manager." And again : "We feel 
 confident that with him in command, we will not only keep up our 
 business, but will increase it to the largest dimensions.'' 
 
 The plaintiff's position is thus described in letters signed by the de- 
 fendants. Its range is sketched in outline. The picture is completed 
 when we view the course of dealing. The defendants were manufac- 
 turers, importers and sellers of ribbons. The plaintiff took charge of 
 the selling department. He supervised and directed the salesmen. 
 He helped the defendants themselves in selecting designs and fixing 
 prices. He made trips abroad, inspected the foreign styles, and pur- 
 chased the foreign merchandise. His position was one of general su- 
 pervision. The partners were his sole superiors. 
 
 *2In accord: Williams v. Robinson, 73 Me. 186, 40 Am. Rep. 352 (1882), 
 sale of goods; Sage v. Wilcox, 6 Conn. 81 (1826), guaranty of note (see 
 definition of "agreement" by the court) ; De Camp v. Scofield, 75 Mich. 449, 
 42 N W 962 (1889), guaranty; Brown v. Fowler, 70 N. H. 634, 47 Atl. 412 
 (1900) guaranty; Egerton v. Matthews, 6 East, 307 (1805), sale of goods. 
 Contra- Wain v. Warlters, 5 East, 10 (1804), guaranty (now nullified, 
 in case of ffuaranties, by statute;' see 7 Halsbury, Laws of Englan(^, 374) ; 
 Cooley V LobdeU, 153 N. Y. 596, 47 N. E. 783 (1897), land; Siemers v. 
 Siemers 65 Minn 104, '67 N. W. 802, 60 Am. St. Bep. 430 (1896), marriage. 
 The state statutes often expressly provide whether the consideration must 
 be stated in the memorandum. See Hay^s v. Jackson, 159 Mass. 451, 34 N. 
 B 683 (1893) need not be; Commercial Natl. Bank of Appleton v. Smith, 
 107 Wis. 574, 83 N. W. 766 (1900), inust be. • 
 
1454 1 : :; - the statute OF FRAUDS (Ch. 10 
 
 At the beginning of 1913 there was a renewal of the,' .employment for 
 three ^^ears, but at a larger compensation. The new, contract was made 
 by word of mouth. Nearly a year later its terms were put in writing. 
 Some of the defendant's salesmen had expressed hostility towstrd the 
 plaintiff. The defendants reproved him, and said that he would have 
 to leave. The disagreement, though amicably adjusted, seems to have 
 been a warning to the plaintiff" that his tenure was insecure. Thus 
 warned, he requested and received the following memorandum: 
 
 "New York. December 22, 1913. 
 
 "It, is understood between Johnson Cowdin & Co. and Leon Marks 
 that the arrangements made for employment of Leoii Marks in our 
 business on January first, ,1913, for a period of three years from that 
 date at a -salary of $15,000.00 (fifteen thousand) per year plus five 
 (5 %) per cent, of the gross profits earned in our business which we 
 agree shall be not less than $5,000 00/100 per year^continues in force 
 until Jan. 1st, 1916. Johnson Cowdin & Co. 
 
 "John E. Cowdin. 
 "E. N. Herzog." 
 ' Eor a time the plaintiff's services continued unchanged. The trou- 
 ble began in the summer of 1914. Some of . the events of thai season 
 are in dispute. We state the plaintiff's version, for it was accepted by 
 the, jury. One of the defendants said to the plaintiff : "I am going ttf 
 put Mr. McLaren, who has been assisting you, in your position." The 
 plaintiff was notified in writing : "The selling department will be in 
 the hands of Mr. McLaren, and you will naturally report to him.'' 
 
 The title of sales manager, which had once been his, was thence- 
 forth to be another's. In the past the chief business had been the 
 sales to dealers in- ribbons. One of the minor incidents had been the 
 sales to manufacturers of dresses, underwear, and other articles; who 
 used ribbons incidentally in making up their products. The plaintiff 
 was directed in the future to attend to this trade exclusively. Accord- 
 ing to his testimony, he was to do the work of salesmen who had for- 
 merly been paid at the rate of $25 a week. According to the testi- 
 mony of the defendants, he was to have salesmen under him, and was 
 to develop a new branch of trade. Over him, however, was to be 
 McLaren, with general power of control. The plaintiff protested that 
 the defendants in thus changing his duties were changing his position. 
 His refusal to submit to the change was followed by his discharge, and 
 the discharge by this lawsuit. The plaintiff had a verdict of $24,794,- 
 52. The Appellate Division reversed the judgment and dismissed the 
 complaint. 
 
 The chief question in the case grows out of the statute of frauds. 
 The contract of employment was not to. be performed within a year. 
 There is need, therefore, of a note or memorandum of its terms, sub- 
 scribed by the parties to be charged. Personal Property Law, § 31 ; 
 Consol. Laws, c 4L The defendants signed a memorandum which 
 continued an existing employment, but Tyhjch did not describe its du- 
 
Sec. 6) THE CHARACTER OF THE MEMORANDUM REQUIRED 1455 
 
 tT'fhJ^i^ '^''^'!J°" is Whether the position may be identified by proof 
 rnntr. '™™ f circumstances. The employment under the new 
 contract began m January. The memorandum was not signed till the 
 
 i^T"!-ff ""^ ''i,,.^* "''"'""' ^^^ ^^i^tence of a position which 
 he plaintiff ,s then filling. It says that the employment shall be con- 
 , tinned for a term and at a salary prescribed. A position then held is 
 earned forward and .preserved. The tests to be applied in order to 
 identity, the employment are thus embodied in the writing. We are 
 not left to gather the relation between the parties from executory 
 promises. We are informed that the relation then existing is the one 
 to be maintained. If A. agrees to sell to B. "the house and lot now 
 occupied by the seller," the description is not void because the bounds 
 of occupation must be established by parol. Doherty v Hill 144 
 Mass. 465, 467, 11 N. E. 581; Hurley v. Brown, 98 Mass. 545, 96 
 Am. Dec. 671; Mead v. Parker, 115 Mass. 413, 15 Am. Rep. 110- 
 Shadlow V. Cottrell, h. R. 20 Ch. D. 90; Plant v. Bourne, 1897. 2 
 Ch. 281; Cave v. Hastings, 7 Q. B. D. 125; Carr v. Lynch, 1900, 1 
 Ch. 613 ; Catling v. King, 5 Ch. D. 660; Hodges v. Kowing, 58 Conn. 
 12, 18 Atl. 979, 7 L. R. A. 87; Richards v. Edick, 17 Barb. 260, 269. 
 It is not otherwise where A. agrees with B. that a position in A.'s 
 service then held shall be continued. "I will keep you until January 1, 
 1916, at so much a year, in your present place." By necessary impli- 
 cation, by inevitable construction, that is what this memorandum says. 
 It makes no difference whether the place is land to be occupied or a 
 relation of employment to be filled. Whether it is the one or the oth- 
 er, we do not violate the statute when we fit the description to the 
 facts. In thus identifying the .position we are not importing into the 
 contract a new element of promise. We are turning signs and sym- 
 bols into their equivalent realities. This must always be done to some 
 extent, no matter how many are the identifying tokens. "In every 
 case, the words used must be translated into things and facts by parol 
 evidence." Holmes, J., in Doherty v. Hill, supra, 144 Mass. 468, 11 
 N. E. 583; Mead v. Parker, supra, 115 Mass. 415, 15 Am. Rep. 110; 
 4 Wigmore on Evidence, § 2454. 
 
 How far the process'may be extended is a question of degree. Do- 
 herty V. Hill, supra, 144 Mass. 469, 11 N. E. 581. We exclude the 
 writing that refers us to spoken words of .promise. We admit the one 
 that bids us ascertain a place or a relation by comparison of the de- 
 scription with some "manifest, external, and continuing fact." Do- 
 herty V. Hill, supra, 144 Mass. 469, 11 N. E. 584. The statute must 
 not be pressed to the extreme of a literal and rigid logic. Some com- 
 promise is inevitable if words are to fulfill their function as symbols 
 of things and of ideas. How many identifying tokens we are to ex- 
 act, the reason and common sense of the situation must tell us. 
 "What, then, is a sufficient description in writing? No one can say 
 beforehand." Jessel, M. R., in Shadlow v. Cottrell, supra. "You can.- 
 not have a description in writing that will shut out all controversy, 
 
1456 THE STATUTE OF FRAUDS (Ch. 10 
 
 even with the help of a map." Id. "In every case it must he con- 
 sidered what is a sufficient description with reference to the surround- 
 ing circumstances and the facts." Jessel, M. R., in, CatHn v. King, 
 supra, p. 664. Some description there must be. Its adequacy depends 
 upon the degree of certainty attained when the words are applied to 
 things. From correspondence we infer identity. Beckwith v. Talbot, 
 95 U. S. 289, 292, 24 L. Ed. 496. A. has been employed by B. as a 
 bookkeeper and accountant. He receives a writing to the effect that 
 his employment, which is stated to have begun some years before, is 
 continued, for a given term. We shall make a farce of the statute if 
 we say that oral evidence is incompetent to show that A. is not ex- 
 pected to do the work of a porter. "There' is' no mystery about the 
 statute of frauds." Chitty, L. J., in Plant v. Bourne, supra. The 
 memorandum which it requires, like any other memorandum, must be 
 read in the light of reason. Id. 
 
 In this case the plaintiff does not need the aid of one spoken word 
 of promise to identify his place. His first contract was for two 
 years, from January 1, 1911, to January vlj 1913. During that period, 
 writings subscribed by the defendants attest the nature of his position. 
 The memorandum exacted by the statute does' not have to be in one 
 document. It may be pieced together out of separate writings, con- 
 nected with one another either expressly or by the internal evidence of 
 subject-matter and occasion. Ridgway v. Wharton, L. R. 6 H. L. C. 
 238 ; Cave v. Hastings, L. R. 7 Q. B. D. 125 ; OHver v. Hunting, L. 
 R. 44 Ch. D. 205; Bibb v. Allen, 149 II. S. 481, 496, 13 Sup. Ct. 950, 
 37 L. Ed. 819; Peck v. Vandemark, 99 N. Y. 29, 34,. 1 N. E. 41 ; Coe 
 V. Tough, 116 N. Y. 273, 22 N. E. 550; Levin v: Dietz, 106 App. 
 Div. 208, 211, 94 N. Y. Supp. 419; Title G. & T. Co. v. Lippincott, 
 252 Pa. 112, 97 Atl. 201; Polldck, Contracts (8th Ed.) p. 171. It is 
 not even necessary that they be writings from the promisor to the 
 promisee. They m.ay be from the promisor to his own agent. Gibson 
 V. Holland, L. R. 1 C. P. 1; Townsend v. Hargraves, 118 Mass. 325, 
 335; Argus Co. v. Mayor^ etc., of Albany, 55 N. Y. 495, 505, 14 Am. 
 Rep. 296'; Peabody v. Speyers, 56 N. Y. 230, 237; Browne, Statute 
 of Frauds,' §■ 354a. - , ■ " 
 
 Tested by these riiles, the first contract is plainly valid. The second 
 must be interpreted in the light of what had gone before. The cir- 
 cum.stances are persuasive in their collective force. We see this when, 
 we put them together. There is a note or memorandum in writing 
 that the plaintiff was employed in 1911 to act for two years as the de- 
 fendants' sales manager. There is evidence, not contradicted, that for 
 two years he did occupy that position. There is evidence, again un- 
 contradicted, that after the expiration of his first contract, he occu- 
 pied the same position. And there is a note or memorandum in writ- 
 ing that in December, 1913, the position then filled was continued for 
 a term of years. To give heed to these thirigs is not to ignore the 
 rule that the writing must contain all the material terms of the agree- 
 
Sec. 6) THE CHARACTER OF THE MEMORANDUM REQUIRED 1457 
 
 ment. It is to explain the memorandum without changing, or enlarg- 
 ing It. We think the process is one that is justified by precedent 
 Beckwith V. Talbot, 95 U. S. 289, 291, 292, 24 L, Ed., 496; Hagan v. 
 Domestic Sewmg Machine Co., 9 Hun, 7Z ; Davis v. Dodge, 126 App 
 Div. 469, 476, 110 N. Y. Supp. 787: Carr v. Lynch, supra; Plant v. 
 Bourne, supra; Title G. & T. Co. v. Lippincott, supra. 
 
 The plamtiff, then, was employed as sales manager, or at least a 
 j-ury might so find. Finding that, they might also say that the defend- 
 ants removed him from that position when they changed his powers 
 and his duties. It is true that in the past he had visited the manufactur- 
 ers and solicited their trade. But that had been a mere incident to the 
 work of management and supervision. The defendants did not fail 
 to appreciate the significance of the change. They told the plaintiff, 
 if we may credit his testimony, tliat they were giving his position, to 
 another. He had been sales manager before. He was to be sales man- 
 ager no longer. We do not mean to say that he was at liberty to 
 show, by evidence dehors the writing, that under his contract of em- 
 ployment special rightg had become his by force of special promises. 
 To do that would be to do more than identify a position with known 
 and established attributes. It would be to surround the position with 
 peculiar privileges and exemptions. The defendants were free to 
 change the plaintiff's duties at their pleasure as long as the position 
 was unchanged in the things that determine its identity. Beyond that 
 they could not go. It is no answer to say that, even then, the definition 
 of the duties is left open to extrinsic evidence. That would be just as 
 true if the description of the position as that of "superintendent" or. 
 "manager" had been embodied in the writing. Hagan v. Domestic 
 Sewing Machine Co., supra. There would still be lacking a catalogue 
 of the things that a superintendent or a manager does. Yet it would 
 hardly be contended by any one that such a writing would be inade- 
 quate. The difficulty, if there is any, is the usual one that we meet in 
 passing from the particular to the general. There are certain com- 
 mon propertie-s that characterize a class and mark it off from others. 
 These must remain constant, or class identity is lost. There are cer- 
 tain other qualities that characterize the individual. These may be 
 changed, and a place within the class retained. The plaintiff makes 
 no complaint of changes in those qualities that are merely accidental. 
 He does not complain that the defendants subtracted one incident 
 from his position, or added another to it. He says that they changed 
 it altogether; they took the position from one man, and gave it to 
 another. Whether that was in truth the effect of their conduct was a 
 
 question for the juiy. , . , , a 
 
 The Appellate Division dismissed the complaint, but also reversed 
 upon the facts. A new trial is therefore necessary Gressmg v. Mu- 
 siSl Instrument Sales Co., 222 N. Y. 215, 221 118 N.E. 627; Ma- 
 gture V. Barrett, 223 N. Y. 49, 56, 119 N. E. 79; Meisle v. N. Y. C. 
 
 CORBIN CONT. 92 
 
1458 THE STATUTE OF FRAUDS (Ch. 10 
 
 & H. R. R. R. Co., 219 N. Y. 317, 322, 114 N. E. 347, Ann. Cas. 
 191SE, 1081. 
 
 The judgment should be reversed, and a new trial granted, with 
 costs to abide the event. ''^ 
 
 LUSKY et ux. v. KEISER. 
 
 (Supreme Court of Tennessee, 1914. 128 Tenn. 705, 164 S. W. 777, L. K. 
 
 A. 1915C, 400.) 
 
 Action by Louis Eusky and wife against Amelia Keiser. Judgment 
 for defendant, and plaintiffs appeal. Affirmed. 
 
 Williams, J.** Complainants, husband and wife, executed to one 
 Eoventhal, a real estate agent, a contract authorizing the latter to sell 
 a tract of land belonging to the wife. Acting under that contract, 
 Eoventhal opened negotiations With defendant, Keiser, who agreed to 
 purchase. The instrument executed to the real estate agent by com- 
 plainants, so far as pertinent, is quoted, as follows : ' 
 
 "We, Eouis Lusky and Lettie Eusky, hereby authorize and empower 
 Dorris, S. Eoventhal, a real estate dealer in Nashville, Tennessee, to 
 sell for us our farm, containing 106 acres, more or less in the 12th 
 Civil District of Davidson county, Tennessee (here giving boundaries) 
 at and for the sum of $11,000.00, payable $4,500.00 in cash, and an 
 assumption of a mortgage thereon for $3,500.00. * * * And we 
 agree to make a deed to any good purchaser, complying with said, terms, 
 
 *3 The memorandum may consist of several separate documents, no one 
 of whicli would be sufficient standing alone. Some courts are inclined to 
 require that the document signed by the party to be charged must identify 
 by an internal reference the other documents and thus^ authenticate them ; 
 but the reference need not be in express words, and m'Sst courts are Very 
 liberal in admitting parol evidence to identify and connect. See Beckwith v. 
 Talbot, 95 U. S. 289, 24 L. Ed. 496 (1887) ; Woodruff Oil & Fertilizer Co. v. 
 Portsmouth Cotton Oil Keflnlng Corp., 158 C. C. a: 439, 246 Fed. 37S, 158 
 C. C. A. 439 (1917) ; Nickerson v. Weld, 204 Mass. 346, 90 N^ E. 589 (1910) ; 
 Shellnsky v. Foster, 87 Conn. 90, 87 Atl. 35, Ann. Cas. 1914C, 1007 (1913) ; 
 Lerned v. Wannemacher, 9 Allen (Mass.) 412 (1864) ; Brewer v. Horst & 
 Lachmond Co., 127 Cal. 643, 60 Pac. 418, 50 L. R. A. 240 (1900) ; O'Donnell 
 V. Leeman, 43 Me. 158, 69 Am. Dec. 54 (1857) ; Thayer v. Luce, 22 Ohio St. 
 62 (1871) ; Bayne v. Wiggins, 139 U. S. 210, 11 Sup. Ct. 521, 35 L. Ed. 144 
 (1891) ; Gibson v. Holland, L. R. 1 C. P. 1 (1865). 
 
 A signed letter, acknowledging that the contract was made and stating Its 
 terms, either expressly or by reference to another document. Is a sufficient 
 memorandum, even though it expressly repudiates and refuses to be bound 
 by the contract. Bailey v. Sweeting, 9 C. B. N. S. 857 (1861) ; Thirkell v. 
 Cambi, [1919] 2 K. B. 590 (semble) ; Brewer v. Fairmount Creamery Co., 
 104 Kan. 100, 178 Pac. 250 (1919) ; Drury v. Young, 58 Md. 546, 42 Am. Rep. 
 34.3 (18^) ; Louisville Asphalt Varnish Co. v. Lorlck, 29 S. C. 533, 8 S. E. 
 8, 2 L. R. A. 212 (1888). 
 
 A memorandiim does not cease to be sufficient merely because it is lost ; 
 its contents may be proved by parol. Woodruff Oil & Fertilizer Co. v. 
 Portsmouth Cotton Oil Refining Corp., 158 ,C. C. A. 439, 246 Fed. 875, 158 C. 
 C. A. 439 (1917). 
 
 ** Parts of the opinion are omitted. 
 
Sec. 6) THE CHARACTER OP THE MEMORANDUM REQUIRED 1459 
 
 procured by said Loventlial, with the usual covenants of warranty and 
 seism. • •' 
 
 •"This Febiniary 16, 1912. Lettie I.usky. 
 
 -r. r , , "Louis Lusky." 
 
 Uetendants acceptance was appended: 
 
 "February 17, 1912. I hereby accept the proposition. 
 
 . "Amelia Keiser." 
 
 The bill of complaint recites that, in order to carry out the contract 
 m good faith, the. complainants on March 14^ 1912, notwithstanding 
 the refusal of defendant to 'abide by and perform her contract, exe- 
 cuted a deed in accordance with the above-quoted instrument, and ten- 
 dered same, but that its acceptance and contract performance were 
 declined by defendant, who gave no reason or excuse therefor. Suit 
 was brought to recover the difference between the contract price claim- 
 ed to be thus fixed and the market price as determined by a fully ad- 
 vertised auction sale of the land made in May, 1912, to wit, $3,400. 
 
 Defendant, Keiser, interposed a demurrer to the bill of complaint 
 on the grounds : (1) That no contract binding on her was entered into ; 
 and (2) the instrument relied upon as an agreement falls within, and 
 fails because of, the statute of frauds. The chancellor sustained both 
 of these grounds of demurrer,; and from that decree an appeal was 
 prayed to this court. 
 
 It is urged in argument in behalf of complainants and appellants that 
 the instrument signed and delivered to the real estate agent by them 
 was a memorandum sufficiently binding them as the "party to be 
 charged" under our statute of frauds, when defendant's acceptance was 
 indorsed. 
 
 Our statute, as to this phrase, has been construed by this court to 
 mean the owner of the realty rather than the party attempted to be 
 charged or held liable in an action based on the memorandum. Frazer 
 V. Ford, 2 Head, 464; Lee v. Cherry, 85 Tenn. 707, 4 S. W. 835, 4 
 Am. St. Rep. 800. 
 
 It is by the defendant insisted that the instrument so signed and de- 
 livered was not one with her as a contracting party, and operated 
 only as between and on the rights and liability of the owners signing 
 and the real estate agent ; that is, was, in no proper sense, a memoran- 
 dum or contract of sale contemplated by the statute. 
 
 Thus is raised a sharp issue as to the nature and sufficiency of the 
 instrument thus signed by the owners. 
 
 It is not necessary that the contract of sale shall be m writmg, pro- 
 vided there outstands a writing which contains evidence of the es- 
 sential terms of the oral contract, and which is signed by such party 
 to be charged. The memorandum is not the contract, but the. written 
 evidence of it required by the statute. 
 
 A written offer when signed and accepted may constitute a memo- 
 randum of the contract, adequate, though it consist of several parts, 
 such as letters relating to the subject, and even though they may be 
 
14:60 THE STATUTE OF FRAUDS (Ch. 10 
 
 addressed to the owner's agent. Lee v. Cherry, supra; Otis v. Payne, 
 86 Tenn. 666, 8 S. W. 848; 20 Cyc. 254, 255. 
 
 It is thereupon argued that here there is such an' offer shown ad- 
 dressed to the agent of the owners. But does the instrument tend to 
 evidence, what it must do, a contract of sale between complainants as 
 offerers and defendant as offeree? The defendant was not mentioned 
 in the instrument, when signed, as offeree or buyer, as seems requisite. 
 Lee V. Cherry,' supra; Grafton v. Cummings, 99 Ui S. 100, 25 L,. Ed. 
 366; Lewis v. Wood, 153 Mass. 321, 26 N. E. 862, 11 L. R. A. 143; 
 20 Cyc. 261. 
 
 In the case of Haydock v. Stow, 40 N. Y. 363, it appeared that an in- 
 strument was executed and delivered to a firm of real estate agents 
 by the owner, as follows : 
 
 "I hereby authorize and empower Peck, Hillman & Parks, agents for 
 me, to sell the following property (describing it) to be sold within 
 
 days from this date, on the foUowmg terms (giving them), with 
 
 interest semiannually, if desired by the purchaser ; reserving the right 
 to withdraw the property at any time before the sale, by giving Peck, 
 Hillman & Parks notice thereof. ! 
 
 "Troy, February 18, 1864." F. A. Stow." 
 
 Indorsed thereon was, "I hereby agree to purchase the property 
 herein mentioned ufwn the terms expressed," signed by plaintiff, who 
 brought suit to enforce the contract, as one properly evidenced by the 
 above as the memorandum, after Stow had served notice declaring 
 null the instrument thus signed by him. The situation of the parties 
 was the reverse of what appears in the pending case, but the question 
 in each was and is as to the sufficiency of the claimed memorandum. 
 The Court of Appeals, through Hunt, J., said of the instrument : "It 
 is variously styled an agreement to sell, an offer or proposition of sale, 
 and a power of attorney. It is not an agreement to sell, for the rea- 
 son that there are not two parties to it. An agreement cannot be 
 made by one party alone. There is no pretense that Peck and Hillman 
 agreed to buy, or that the defendant agreed to sell to them, and they 
 are the only parties named in the paper, except the defendant himself. 
 Nor do I see any ground upon which it can be called an offer of sale, 
 except so far as the appointment of an attorney to sell may include such 
 offer. I agree that if the defendant had addressed plaintiff a letter 
 offering to sell him these premises upon the ternis specified herein, iand 
 plaintiff had made a written acceptance of the same, addressed and 
 delivered to the defendant, that a contract of sale would have been 
 thereby created. * * * But that is not the present state of facts. 
 I consider the instrument to be a plain, direct, unqualified power of 
 attorney to sell the land mentioned in it ; nothing more, nothing less. 
 I do not discover in it a^ single expression that embarrasses such a 
 conclusion. * * * In law, this reservation" to withdraw the right 
 to sell "was urinecessary," as "the right belonged to the defendant 
 * * * without the formal reservation. * * * This is neither an 
 
Sec. 6) THE CHARACTER OF THE MEMORANDUM REQUIRED 1461 
 
 agreement for sale nor an offer to sell to any particular person, or 
 to the worldat large. It is simply a vesting in Peck &.Co. of a power 
 before existmg m the defendant only. * * * A giving of power 
 and authority, m law creates an agency; but the defendant and Peck 
 & Co were not content with the declaration of law to that effect, but 
 take the pams to allege that, in fact. Peck & Co. are the agents of the 
 defendant to sell his property. They stand then as agents empowered 
 to sell, =f * * and, if they had made such a contract with plaintiff, 
 the defendant would have been bound by it. No such agreement or 
 subscription was made. Plaintiff has, indeed, expressed in writing 
 his readiness to purchase upon the terms that Peck & Co. were au- 
 thorized to accept, but Peck & Co. have put nothing in writing This 
 is not a compliance with the statute, which requires the writing 'to 
 be subscribed by the party by whom the sale was made, or by the 
 agent of such party lawfully authorized.' The defendant or his agent 
 must sign, to make a compHance with the statute, and no aid is de- 
 rived from the signature of plaintiff." * * * 
 
 We think it clear that the instrument executed by the owners, I^usky 
 and wife, was one whose function and end was to define in contract 
 form the relationship betwen them and their agent, lyoventhal; and 
 it is difificult to see how, without a further step by or in behalf of the 
 owners towards contractual assent with defendant, Keiser, that 'in- 
 strument, so perfected as a contract proper, may be deemed a memo- 
 randum evidencing another and different contract between the owners 
 and defendant, Keiser — a contract of sale. There was no existent, oral 
 contract between the latter parties on Februaiy 16, 1912, which couljl 
 have been evidenced by the contract of agency. * * * 46 
 
 On these authorities, and on principle, we conclude that the contract 
 between the complainants and their real estate agent cannot be made 
 to serve as a memorandum which adequately evidenced the essentials of 
 a contract for the sale of realty between the complainants and the de- 
 fendant. The complainants, unless and until they came more imme- 
 diately into contractual relation to defendant, were at liberty to de- 
 cline to proceed. If this be true, the defendajit was not bound to 
 do so. Her signature was not, as we have seen, that of "the party to 
 be charged," and it did not avail to consummate a contract binding on 
 her, where none existed before. 
 
 There is no error in the decree of the chancellor. Affirmed.*" 
 
 *5The court here cited in accord: Lasher v. Gardner, 124 111. 441, 449, 
 36 N E 919, 922 (1888) ; Jordan & Davis v. Mahoney, 109 Va. 133, 135, 68 S. 
 E 467 C1909), and Donnell v. Ourrie & Dohoney, 62 Tex. Civ. App. 134, 131 
 s' W 88 (1910). Contra: Evans v. Stratton, 142 Ky. 615, 134 3. W. 1154, 
 34 L.'b. a. (N. S.) 393 (1911). 
 
 48 In accord: Stengel v. Sergeant, 74 N. 3. Eq. 20, 68 Atl. 1106 (1908): 
 A similar letter was held to be a sufficient memorandum in WiUey v. Gould- 
 ing, 99 Kan.' 328, 161 Pac. 611 (1916). 
 
 Letters from the principal to his agent, wntten after the formation of the 
 contract, may be a sufficient memorandum. Roach v^ Lane, ^6 Mass.' 598, 
 116 N E. 470 (1917) ; Gibson v. Holland, L. R. 1 C. P. 1 (1865). 
 
1462 THE STATUTE OP FRAUDS (Ch. 10 
 
 LUCAS V. DIXON. 
 (In the Court of Appeal, 1889. 22 Q. B. Div. 357.) 
 
 The action was brought for the non-acceptance of goods on a con- 
 tract coming within the 17th section of the Statute of Frauds. The 
 plaintiff having made an application under Order XIV, r. 1, the de- 
 fendant made an affidavit in opposition. At the trial the plaintiff 
 relied on the affidavit so made as constituting a note or memoran- 
 dum of the contract sufficient to satisfy the statute. The learned 
 judge was of opinion that the terms of the contract sufficiently ap- 
 peared in the affidavit to make it a note or memorandum but that it 
 could not be available to the plaintiff as it was not in existence when 
 the action was brought. He therefore gave judgment for the defend- 
 ant. • 
 
 Plaintiff appealed. ' 
 
 BowEN, L,. ]." The question is whether there is a note or memo- 
 randum in writing sufficient to satisfy the Statute of Frauds, and the 
 evidence in support of that view consists of an affidavit sworn by 
 the defendant in opposition to' an ippHcafion iinder Order XIV. If 
 this affidavit, which I will assume for the purpose of the argument 
 contains sufficient evidence of the contract, had been sworn in some 
 previous action and had been used in this, Goode v. Job, 28 h. J. 
 (Q. B.) 1, and Barkwdrth v. Young, 4 Drew. 1, show that the document 
 is not necessarily the less a sufficient memorandum because it is sworn 
 in an action. What we have to consider is whether such a memoran- 
 dum after action is sufficient in that action. I think the triie' view is 
 that expressed by Lord Blackburn in Mkddison v. Alderson, 8 App. 
 Cas. 467, at page 488 : "I Yhink it is now finally settled that the true 
 construction of the Statute of Frauds, both the 4th and 17th sections, 
 is not to render the contracts under them void, still less illegal, but is 
 to render the kind of evidence required indispensable when it is sought 
 to enforce the contract." That still leaves it open to question as 
 to what is the time at which it can be said the contract is sought to 
 be enforced — when the action ig brought, or when it is sought to 
 prove the case by adducing the evidence. I cannot help thinking that 
 the view of Lord Blackburn was that at the time the action is brought 
 the evidence ought to be in existence, at all events in a contract un- 
 der section 4, because he speaks of a contract not being "enforce- 
 able" unless signed by or on behalf of the party to be charged. 
 
 But we must consider the matter partly on the statute and partly 
 on the authorities. I^ooking at the statute itself it strikes one that 
 it is fer the prevention of fraud as well as perjury. Jt may well be 
 that though the contract may not be void, the legislature intended to 
 prevent persons being vexed with actions that could not succeed. 
 
 *'' Part of Lord Justice Bowen's opinion and the concurring opinions of 
 Lord Esher, M. R, and Fry, L. J., have been omitted. 
 
Sec. 6) THE CHARACTER OF THE MEMORANDUM REQUIRED 1463 
 
 But when we come to section 4, I cannot help thinking that it is per- 
 lectly clear that the memorandum or note must be in existence at 
 the time the action is brought. That was the view taken by the 
 (^ourts in Equity which had to deal with the 4th more perhaps than 
 they had with the 17th section. I think it follows that was their view, 
 because they allowed a bill, which showed on the face of it that the 
 conditions of the statute had not been complied with, to be demurred 
 to, or, in other words, allowed a defendant to take by demurrer an ob- 
 jection to the institution of the action, which would show that they 
 thought that the matter could not be cured by evidence. Wood v. 
 Midgley, 5DeG. M. &G. 41. 
 
 It was held, no doubt, that if the defendant admitted his liability that 
 was sufficient — not on the ground that his admission was a memoran- 
 dum of the contract, but that it was an admission that there was such 
 a memorandum. That is shown by the fact that if, at the same time, 
 he set up the statute his^ admission did not operate. So a plea of the 
 statute was allowed, and as a plea goes to the state of things at the 
 time of action brought that leads to the same conclusion. Then when 
 we come to section 17, is there any distinction in reason between the 
 matters dealt with in the two sections so tis to lead us to think that 
 some different reasoning applies to them? The words are diflferent, 
 but in section 17 one of the things for which a contract shall be al- 
 lowed to be good is acceptance of part of the goods, which one would 
 certainly expect to take place before action, and another is the giv- 
 ing- of something in earnest to bind the bargain, to which the same 
 remark applies. It is reasonable to suppose from this that the note 
 or memorandum was to be something completed before action. Turn- 
 ing to the cases, the Courts have never drawn a distinction in this 
 respect between the two sections, on the contrary, the general opinion 
 expressed in the cases is that they are in pari materia. 
 
 There is a great deal of authority a:t common law that a memoran- 
 dum coming into existence after action brought is not available to the 
 plaintiff under section 17. In Fricker v. Thomlinson,> 1 M. & G. 
 772, there was no decision, but Maule; J., expressed an opinion on the 
 point. In Bill v. Bament, 9 M. & W. 36, the point was made which 
 is sought to be argued in the present case, but it was abandoned, or 
 at all events treated as untenable, because the counsel on the other 
 side were stopped. Lord Abinger thought it too untenable to require 
 discussion, and Parke, B., said : "There must, in order to sustain the 
 action, be a good contract in existence at the time of the action brought ; 
 and to make it a good contract under the statute, there must be one of 
 the three requisites therein mentioned." * * * 
 
 Appeal dismissed.** 
 
 *8Bailev v Sweeting, 9 O. B. (N. S.) 84.3 (1861), per Williams, J.; Willis- 
 ton sS§ nT-TTisdile V. Harris, 20 Pick. (Mass^) 9 (1838) senxble; Bird 
 y. Munroe, 66 Me. 337, 22 Am. Kep. 571 (1877). Contra: Cash v. Clark, 61 
 Mo. App. 636 (1895). 
 
1464 THE STATUTE OF FRAUDS (G^. 10 
 
 SECTION 7.— THE LEGAL OPERATION OF THE STATUTE 
 
 , BIRCH V. BAKER et al. 
 
 (CJourt of Errors and Appeals of New Jersey, 1914. 85 N. J. Law, 660, 90 
 Atl. 297, L. il. A. 1916D, 485.) 
 
 Bbrgen, J.*° The plaintiff and the five defendants, being, residents 
 of the town of Dover, were interested in procuring the Sims-Kent 
 Company to locate there a manufacturing plant, and to accomplish 
 this entered into negotiations with the company, which resulted in a 
 written agreement between the plaintiff and the defendants, as joint 
 contractors, and the company, in which 'the plaintiff and the defendants 
 agreed "to secure and convey to said company in fee simple the title 
 of said land and premises from the said Foster F. Birch," the premises 
 being a tract of land in Dover belonging to the plaintiff. In consid- 
 eration of this conveyance, to be without cost to it, the Sims-Kent Com- 
 pany agreed to erect its factory on the lands. The plaintiff subse- 
 quently conveyed the land to the company, and it erected thereon its 
 factory. The plaintiff, claiming that the defendants, to induce him 
 to make the conveyance to the Sims-Kent Company according to their 
 contract, promised orally to pay him $2,000 of the consideration price, 
 upon their refusal to pay, brought his suit against the defendants on 
 their oral promise. There was evidence from which it could be infer- 
 red that the defendants, to induce plaintiff to enter into the contract, 
 and subsequently convey the land to the Sims- Kent Company, promised 
 to pay him $2,000. 
 
 The trial court ordered a judgment of nonsuit from which plaintiff 
 appeals, and the defendants now seek to sustain the , nonsuit upon the 
 ground that the oral promise was one concerning the sale of lands, and, 
 not being in writing; void under the statute for the prevention of 
 frauds and perjuries (C. S. 2610), section 5 of which prohibits an ac- 
 tion to charge any person "upon any contract or sale of lands, tene- 
 ments or hereditaments, or any interest in, or concerning them," un- 
 less the agreement be in writing, signed by the person charged. 
 
 This case was before the Supreme Court on a rule to show cause, 
 where it was held that such a promise was within the statute (79 N. 
 J. Law, 10, 74 Atl. 151), and on the second trial, the judge at circuit, 
 following the judgment of the Supreme Court, ordered the nonsuit. 
 The plaintiff having appealed from the judgment of nonsuit, the ques- 
 tion presented is whether a promise, not in writing, to pay, the owner 
 of lands an agreed consideration if he convey the land to one in per- 
 formance of a written contract by the promisor to secure such con- 
 
 *» Parts of the opinion, and the specially concurring opinion of White, 
 J., are omitted. Three of the twelve judges dissented. 
 
Sec. V) THE LEGAL OPBBATION O'ff THE STATUTE 1465 
 
 veyance, and the owner does convey as requested, relying upon such 
 prranise, is enforceable as not being barred by the statute of frauds. 
 
 That a vendor may recover in assumpsit upon an oral promise by 
 the vendee to pay the consideration agreed upon for land conveyed, 
 and that such promise is not withjn the statute, has the sanction both 
 of legal reasoning and adjudged cases. It was so held by the Supreme 
 Court of this state in Murray v. Schuldt, 73 N. J. Law, 489, 63 Atl. 
 904, where the court said "that, the property having been conveyed to 
 the defendant, the plaintiff's action was not upon the express contract 
 of sale, but upon the debt which arose upon the conveyance," and that 
 such promise was not within the statute. * * * 
 
 In the case under review, the defendants had in writing contracted 
 to "secure and convey to said company in fee simple" land the title 
 to which was vested in the plaintiff. This was a binding contract which 
 the defendants fulfilled by inducing plaintiff to convey upon their oral 
 promise to pay him a portion of the consideration money. He, re- 
 lying upon that promise, parted with his land to the party the defend- 
 ants had contracted with, thus completing for them the sale they had 
 in writing agreed to secure, and thereby relieving them from their ob- 
 ligation to the vendee concerning the sale of the land, or of any inter- 
 est therein, which is a sufficient and legal consideration for their prom- 
 ise. Having by their promise to plaintiff been enabled to fulfill their 
 written obligation, binding under the statute, it would further the per- 
 petration of a fraud of most flagrant character to allow the defend- 
 ants to escape carrying out their bargain with the landowner, and this 
 ought not to be permitted, unless their promise is barred by the statute, 
 and we think it is not. If the conveyance had been made to the defend- 
 ants, their promise, although oral, to pay the consideration would not be 
 within the statute, and their legal obliga;tion to the vendor is not altered 
 because he conveys to their nominee instead of to them, for they get 
 a benefit from the conveyance in either event, and it is illogical to ar- 
 gue that what the plaintiff did for the defendants at their request was 
 not a performance of their contract by the plaintiff, who. advanced 
 his land for their exoneration. Whether it was money or land which 
 they had contracted to supply, and which the plaintiff supplied for 
 them, is of no consequence, for, as was well said by Chief Justice 
 Hornblower in Linn v. Cook, 19 N. J. Law, 11, whenever the plaintiff 
 has discharged an obligation of the defendant "to any other person, 
 by applying his own money, goods, chattels, securities, or land to such 
 discharge, he may recover the amount so paid or satisfied, in an action 
 of general indebitatus assumpsit for money paid." * * * _ 
 
 We have no doubt that where a sale of land is executed by delivery 
 and acceptance of a conveyance passing the title, a previous oral prom- 
 ise to pay the consideration, whether the conveyance be to the prom- 
 isor or to his nominee, is not within the statute of frauds, for the con- 
 sideration of the promise is executed, and the law implies a debt recov- 
 erable in assumpsit, when there has been a previous request by the 
 
1466 THE STATUTE OF FRAUDS (Ch. 16 
 
 defendant to convey to him, or his nominee, coupled with circum- 
 stances showing that both parties expected that plaintiff would be rec- 
 ompensed for complying with such request, and the action is not limited 
 to cases where money alone has been expended, but extends to those 
 where goods, secvirities, or land have been parted with on a previous ex- 
 press request. 
 
 It is not without significance that these defendants, in the contract 
 they made with the Sims-Kent Company, required it to deposit in the 
 bank a sum of money subject to their order, or to the order of a major- 
 ity contracting to convey, as a guaranty that after conveyance that com- 
 pany would proceed to erect the factory on the land. The sum required 
 to be deposited was not the full consideration named in the deed, but 
 only $2,000, which was the precise sum which plaintiff's, case shows 
 they promised to pay him, and the inference is permissible that this 
 was required to secure the defendants for the cost of the land, if the 
 Sims-Kent Company did not make the agreed use of it. 
 
 It further appears that these defendants subsequently assented to the 
 withdrawal of the $2,000 by the depositing company when it had, to 
 their satisfaction, complied with the terms of its contract with them, 
 which may be taken, until otherwise explained, as an indication that 
 the consideration which defendants contracted for as the price of the 
 conveyance of the land had been fulfilled by their nominated vendee to 
 their satisfaction, which would justify the inference of an accepted 
 performance of the covenant contained in the contract of sale benefi- 
 cial to them. 
 
 In this case there was testimony from which may be inferred, not 
 only a request to convey, but a promise by the defendants to pay a part 
 of the value of the land, which at their request the plaintiff conveyed 
 to their nominee in satisfaction of their contract, and when plaintiff 
 advanced his land to relieve these defendants, at their request, the law 
 raised an implied promise by the defendants so benefited to reim- 
 burse him, a promise which has no concern with the sale of land or 
 of any interest therein. The sale was closed when plaintiff conveyed, 
 and nothing remained to be done to complete the sale of the land. The 
 promise which induced the conveyance became a debt of those who 
 agreed to pay the consideration, enforceable as an implied obligation 
 arising in part from what the plaintiff did under the influence of the 
 contract. * * * 
 
 Reversed.^" 
 
 "o The oral executory agreement is iwevented by the statute from having 
 full legal operation; but performance is not forbidden, and when such acts 
 of performance are complete they are given almost the same legal effect 
 that they would have had if the contract had been in writing. Thus, where 
 land is duly conveyed by deed, in accordance with an oral contract, title 
 passes, and is not affected by the fact that the deed is later destroyed before 
 recording. Shipley v. Shipley, 274 111. 506, 113 N. E. 906 (1916). See, 
 further, as to the effect of full perforinance : Stone v. Dennison, 13 Pick. 
 (Mass.) 1, 23 Am. Dec. 054 (1832) ; Brown v. Farmers' Loan & Trust Co., 
 
Sec. 7) THE LEGAL OPERATION OP THE STATUTE 1467 
 
 IMPERATOR REALTY CO., Inc., y. TUEL. 
 
 (Court of Appeals of New York, 1920. 228 N. Y. 447, 12T N. E. 263.) 
 
 Action by the Imperator Realty Company against Samuel P. Tull. 
 From a judgment of the Appellate Division, First Department (179 
 App. Div. 761, 167 N. Y. Supp. 210), reversing on questions of fact and 
 law a judgment of the Trial Term in favor of plaintiff, and dismissing 
 the complaint, plaintiff appeals. Reversed, and judgment of the Trial 
 Term affirmed. 
 
 Chase, J. The parties to this action entered into a written contract 
 under seal for the exchange of pieces of real property in the city of 
 New York. On the day fixed therein for carrying out the contract and 
 making the conveyances, the defendant deliberately defaulted. The 
 action was brought to recover damages alleged to have been sustained 
 by the plaintiff. 
 
 At the trial the jury determined all of the issues in favor of the 
 plaintiff and rendered a verdict for it. The defendant appealed from 
 the judgm^t entered upon such verdict, and the Appellate Division 
 reversed the judgment and dismissed the complaint. Imperator Realty 
 Co., Inc., v. Tull, 179 App. Div. 761, 167 N. Y. Supp. 210. 
 
 One of the provisions of the contract is: "All notes or notices of 
 violations of law or municipal ordinances, orders, or requirements 
 noted in or issued by any department of the city of New York against 
 or affecting the premises at the date hereof, shall be complied with 
 by the seller and the premises shall be conveyed free of the same." 
 
 There were several notices of violations of law or municipal ordi- 
 nances, orders, or requirements noted in or issued by a department 
 of the city of New York against or affecting the premises to be con- 
 veyed by the plaintiff at the date of the contract which, although aggre- 
 gating an amount that is comparatively very small, were not satisfied 
 or discharged on the day when the property \Vas to be conveyed. The 
 plaintiff sought to avoid the failure to procure the discharge of such 
 violations by an alleged modification of the contract pursuant to a 
 conversation between the president of the plaintiff and the defendant 
 in which it is claimed that there were reciprocal promises. The pres- 
 ident of the plaintiff testified that after the making of the contract, 
 and on the same day thereof, it was agreed between the parties to the 
 contract that either party in place of satisfying ajiy of the so-called 
 violations that might be filed against the pieces of real property there- 
 in mentioned might deposit with .the New York Title Insurance Com- 
 
 117 M T 266 22 N E. 952 (1889). A plaintiff who has partly performed 
 ll\^e b^enefit'o'f the defendaU before the latter repudU^tes^an..^ 
 quasi contract. McDonald v. Crosby 192 IlL 283 61 ^^^^ fa. (1001^) ,^^^ ^ 
 
 'Im VTiSn''3°16,"tiNW. 116- (1900). See Woodward, Quasi Contracts, 
 Thurston's Cases on Quasi Contracts, 312-352. 
 
1468 THE STATUTE OF FRAUDS (Ch. 10 
 
 pany a sufficient amount of cash to pay and discharge the same. There 
 . is evidence in the record to show that the plaintiff was able and willing 
 on the day and at the time and place for closing the contract, to carry 
 out the same as therein provided except that he could not convey the 
 property to be transferred by him free from such violations, and there 
 is also evidence that he was able and willing to deposit a sufficient 
 amount of cash to comply with and free the property from the viola- 
 tions as required by such oral agreement between the parties.''^ * * * 
 Cardozo, J. (concurring in. result). The statute says that a con- 
 tract for the sale of real property "is void unless the contract; or some 
 note or memorandum thereof, expressing the consideration, is in writ- 
 ing, subscribed by the * * * grantor, or by his lawfully author- 
 ized agent." Real Property Law (Consol. Laws, c. 50) § 259 (statute 
 of frauds). In this instance, each party was a grantor, for the sale 
 was an exchange. I think it is the law that, where contracts are subject 
 to the statute, changes are governed by the same requirements of foirm 
 as original provisions. Hill v." Blake, 97 N. Y. 216; Clark v. Fey, 
 121 N. Y. 470, 476, 24 N. E. 703. Abrogated by word of^mouth such 
 a contract may be (Blanchard v. Trim, 38 N. Y. 225), but its obliga- 
 tion may not be varied by spoken words of promise while it continues 
 undissolved (Swain v. Seamens, 9 Wall. 254, 271, 272, 19 L. Ed. 554; 
 Emerson v. Slater, 22 How. 28, 42, 16 L. Ed. 360; Ooss v. Lord Nu- 
 gent, 5 B. & Aid. 58; Harvey v. Graliam, 5 Ad. & El. 61; Hickman 
 V. Haynes, L. R. 10 C. P. 598 ; Abell v. Munson, 18 Mich. 307, 100 Am. 
 Dec. 165 ; Malkan v. Hemmung, 82 Conn. 293, 73 Atl. 752 ; Long v. 
 Hartwell, 34 N. J. Law, 116; Rucker v. Harrington, 52 Mo. App. 481 ; 
 Bradley v. Harter, 156 Ind. 499, 60 N. E. 139; Jarman v. Westbrook, 
 134 Ga. 19, 67 S. E. 403; 1 Williston on Contracts, §.593). A recent 
 decision of the House of Lords reviews the English precedents; and de- 
 clares the rule anew. Morris v. Baron & Co., 1918, A. C. 1, 19, 20, 
 31. Oral promises are ineffective to make the contract, or any part 
 of it, in the beginning. Wright v. Weeks, 25 N. Y. 153; Marks v. 
 Cowdin, 226 N. Y. 138, 123 N. E. 139. Oral promises must also be in- 
 effective to vary it thereafter. Hill v. Blake, supra. Grant and consid- 
 eration alike must find expression in a writing. Real Prop. Law, § 
 259; Consol. Laws, c. 50.°^ 
 
 °i The remainder of the opinion of Chase, J., is omitted. 
 
 ''^ A contract within the statute of frauds and actually in writing can bfr 
 rescipded by a mutual unwritten agreement. Grand Traverse Fruit & Produce 
 Exch. V. Thomas jQannihg Co., 200 Mich. 95, 166 N. W. 878 (1918) ; Ely v. 
 Jones, 101 Kan. 572, 168 Filc. 1102 (1917), rescission of contract for sale of 
 land. Contra: "Woolen v. Sloan, 94 Wash. 551, 162 Pac. 985 (1917), written 
 option on land. 
 
 In Morris v. Baron, [1918] A. C. 1, Ann: Cas. 19180, 1197, and note, it" was 
 held that a written contract for the sale of goods was effectively rescinded 
 by a subsequent agreement, even though the latter agreement was itself for 
 a new sale of goods within the statute of frauds and was not independent! v 
 enforceable for want of a writing. The court drew a distinction betwec n 
 rescission and variation, the former being possible by parol and the latter n )t 
 
Sec. 7) THE LEGAL OPERATION OF THE STATUTE ' 1469 
 
 Some courts have drawn a distinction between the formation of the 
 contract and the regulation of performance. Cummings v. Arnold 
 3 Mete. (Mass.) 486, 37 Am. Dec. 155; Stearns v. Hall, 9 Cush! 
 (Mass.) 31; Whittier v. Dana, 10 Allen (Mass.) 326; Hastings v. 
 Lovejoy, 140 Mass. 261, 2 N. E. 776, 54 Am. Rep. 462; " Wood on 
 Statute of Frauds, p. 758. The distinction has been rejected in many 
 jurisdictions. See cases cited supra; also, t. R. A. 1917B, 141 note. 
 It has never been accepted by this court, and the question of its validity 
 has been declared an open one. Thomson v. Poor, 147 N. Y. 402, 408, 
 42 N. E. 13, characterizing as dicta the statements in Blanchard v. 
 Trim, supra. I think we should reject it now. The cases which main- 
 tain it hold that oral promises in such circumstances constitute an ac- 
 cord, and that an accord, though executory, constitutes a bar if there is 
 a tender of performance. Cummings v. Arnold; Whittier v. Dana, 
 supra. There seems little basis for such a distinction in this state where 
 the rule is settled that an accord is not a bar unless received in satis- 
 faction. Reilly v. Barrett, 220 N. Y. 170, 115 N. E. 453; Morehouse 
 V. Second Nat. Bank of Oswego, 98 N. Y. 503, 509 ; cf . Ladd v. King, 
 1 R. I. 224, 51 Am. Dec. 624; Pollock on Contracts (3d Am. Ed.) p. 
 822. But there is another objection, more fundamental and far-reach- 
 ing. I do not know where the line of division is to be drawn between 
 variations of the substance and variations of the method of fulfill- 
 ment. I think it is inadequate to say that oral changes are effective if 
 they are slight and ineffective if they are important. Such tests are 
 too vague to supply a scientific basis of distinction. "Every part of 
 the contract in regard to which the parties are stipulating must be taken 
 to be material." Per Parke, B., Marshall v. Lynn, 6 M. & W. 116, 
 117; 1 Williston on Contracts, § 594. The field is one where the law 
 should hold fast to fundamental conceptions of contract and of duty, 
 and follow them with loyalty to logical conclusions. 
 
 The problem, thus approached, gains, I think, a new sirnplicity. A 
 contract is the sum of its component terms. Any variation of the 
 parts is a variation of the whole. The requirement that there shall 
 be a writing extends to one term as to another. There can therefore 
 be no contractual obligation when the requirement is not followed. 
 This is not equivalent to saying that what is ineffective to create an 
 obligation must be ineffective to discharge one. Duties imposed by law 
 irrespective of contract may regulate the relations of parties after 
 they have entered into a contract. There may be procurement or en- 
 couragement of a departure from literal performance which will forbid 
 the assertion that the departure was a wrong. That principle will be 
 found the solvent of many cases of apparent hardship. There may 
 be an election which will preclude a forfeiture. There may be an ac- 
 
 Dossible. The intention to rescind may be quite indeper.dent of the intention 
 to sell goods on new terms, even though expressed at the same time 
 B3 See also Conroy v. Toomay, 234 Mass. 384, 125 N. E. 568 (1920), 
 
1470 THE STATUTE OF FRAUDS ■ (Ch. 10 
 
 ceptance of substituted performance, or an accord and satisfaction. 
 McCreery v. Dayy 119 N. Y. 1, 9, 23 N. E. 198, 6 L. R. A. 503, 16 Am. 
 St. Rep. 793; Swain v. Seamens, supra; Long v. Hartwell, supra; 
 Ladd V. King, supra. Wliat there may not be, when the subject-matter 
 is the sale of land, is an executory agreement, partly written and partly 
 oral, to which, by force of the agreement and nothing else, the law will 
 attach the attribute of contractual obligation. 
 
 The contract, therefore, stood unchanged. The defendant might 
 have retracted his oral promise an hour after making it, and the plain- 
 tiff would have been helpless. He might have retracted a week before 
 the closing, and, if a reasonable time remained within which to re- 
 move the violations, the plaintiff would still have been helpless. Re- 
 traction even at the very hour of the closing might not have been too 
 late if coupled with the offer of an extension which would neutralize 
 the consequences of persuasion and reliance. Arnot v. Union Salt Co., 
 186 N. Y. 501, 79 N. E. 719; Brede v. Rosedale Terrace Co., 216 
 N, Y. 246, 110 N. E. 430. The difficulty with the defendant's position 
 is that he did none of these things. He had notified the plaintiff in 
 substance that there was no need of haste in removing the violations, 
 and that title would be accepted on deposit of adequate security for 
 their removal in the future. He never revoked that notice. He gave 
 no warning of a change of mind. He did not even attend the closing. 
 He abandoned the contract, treated it as at an end, held himself ab- 
 solved from all liability thereunder, because the plaintiff had acted in 
 reliance on a consent which, even in the act of abandonment; he made 
 no effort to recall. 
 
 I do not think we are driven by any requirement of the statute of 
 frauds to sustain as lawful and effective this precipitate rescission, this 
 attempt by an ex post facto revocation, after closing day had come 
 and gone to put the plaintiff in the wrong. "He who prevents a thing 
 from being done may not avail himself of the nonperforniance, which 
 he has, himself, occasioned, for the law says to him, in effect : 'This is 
 your own act, and, therefore, you are not damnified.' " Dolan v. Rodg- 
 ers, 149 N. Y. 489, 491, 44 N. E. 167, quoting West v. Blakeway, 2 M. 
 & Gr. 751. The principle is fundamental and unquestioned. U. S. v. 
 Peck, 102 U. S. 64, 26 L. Ed. 46; Gallagher v. Nichols, 60 N. Y. 438; 
 Risley v. Smith, 64 N. Y. 576, 582 ; Gen. EL Co. v. Nat. Contracting 
 Co., 178 N. Y. 369, 375, 70 N. E. 928; Mackay v. Dick, 6 App. Cas. 
 251 ; New Zealand Shipping Co. v. Societe des Aletiers, etc., 1919 A. 
 C. 1, 5. Sometimes the resulting disability has been characterized as 
 an estoppel, sometimes as a waiver. Gallagher v. Nichols; Gen. El. 
 Co. V. Nat. Contr. Co.; Thomson v. Poor, supra. We need not go 
 into the question of the accuracy of the description. Ewart on Estop- 
 pel, pp. 15, 70; Ewart on Waiver Distributed, pp. 23, 143, 264. The 
 truth is that we are facing a principle more nearly ultimate than either 
 waiver or estoppel, one with roots in the yet larger principle that no 
 one shall be permitted to found any claim upon his own inequity or 
 
Sec. 7) THE LEGAL OPERATION OF THE STATUTE 1471 
 
 take advantage of his own wrong. Riggs v. Palmer, 115 N. Y. 506, 22 
 M. L. 188, 5 L. R. A. 340, 12 Am. St. Rep. 819. The statute. of frauds 
 was not mtended to offer an asylum of escape from that fundamental 
 pnnciple of justice. An apposite precedent is found in Thomson v. 
 Poor, 147 N. Y. 402, 42 N. E. 13. In deciding that case, we put aside 
 ,the question whether a contract within the statute of frauds could be 
 changed by spoken words. We held that there was disability, or, as we 
 styled it, estoppel, to take advantage of an omission induced by an un- 
 revoked consent. Cf. Swain v. Seamens, supra, 9 Wall, at page 274, 
 19 Iv. Ed. 554; Arnot v. Union Salt Co., supra; Brede v. Rosedale 
 Terrace Co., supra; 1 Williston on Contracts, § 595. A like princi- 
 ple is recognized even in the English courts, which have gone as far 
 as those of any jurisdiction in the strict enforcement of the statute. 
 They hold in effect that, until consent is acted on, either party may 
 change his mind. After it has been acted on, it stands as an excuse for 
 nonperformance. Hickman v. Haynes, L. R. 10 C. P. 598, 605 ; Ogle 
 V. Lord Vane, 2 Q. B. 275; 3 I. B. 272; Cuff v. Penn, 1 Maule & S. 
 21 ; Morris v. Baron & Co., 1918 A. C. 1, at page 31. The defendant 
 by hjs conduct has brought himself within the ambit of this principle. 
 His words did not create a new bilateral contract. They lacked the 
 written form pirescribed by statute. They did not create a unilateral 
 contract. Aside from the same defect in fonn, they did not purport 
 to offer a promise for an act. They did, however, constitute the con- 
 tinuing expression of a state of mind, a readiness, a desire, persisting 
 until revoked. A seller who agrees to change the wall paper of a room 
 ought not to lose his contract if he fails to make the change through 
 reliance on the statement of the buyer that new paper is unnecessary 
 and that the old is satisfactory. The buyer may change his mind again 
 and revert to his agreement. He may not summarily rescind because 
 of the breach which he encouraged. That is what the defendant tried 
 to do. When he stayed away from the closing and acted upon an elec- 
 tion to treat the contract as rescinded, he put himself in the wrong. 
 I concur in the conclusion that the judgment must be reversed. 
 
1472 THE STATUTE OF FRAUDS (Ch. 10 
 
 CARPENTER V. MURPHY. 
 (Supreme Court of South Dakota, 1918. 40 S. D. 280, 167 N. W. 175.) 
 
 Action by James S. Carpenter against James Murphy. Judgment 
 for defendant, from which, and an order denying new trial, plaintiff 
 appeals. Affirmed. 
 
 Whiting, P. J. Plaintiff seeks the specific performance of a con- 
 tract to convey real property! Findings, conclusion, and judgment 
 were in favor of defendant. From such judgment and an order deny- 
 ing a new trial this appeal is taken. 
 
 It is appellant's contention that the contract was in writing, and that 
 the trial court eri:ed when it held that such writing was "not a valid, 
 binding, and legal contract for the sale of real estate, and that specific 
 performance of same cannot be enforced." 
 
 Parties contracting for the sale and purchase of real property fol- 
 low one of two courses, either of which was sanctioned by the early 
 common law : They attempt to put the terms of their transaction in 
 writing to preserve indisputable evidence of such terms; or they in- 
 tentionally leave part or all the terms of the contract unevidenced by 
 any writing. As said in Mull v. Smith, 132 Mich, 618, 94 N. W. 183 : 
 ''When the contract itself is in writing and signed by both parties, the 
 writing is the contract. When the memorandum of the oral contract 
 is in writing and signed by the vendor, it is not the contract, but a 
 memorandum." 
 
 Statutes of frauds have condemned oral contracts ; some by leaving 
 such contracts valid, but declaring them unenforceable; others, like 
 ours,, by declaring the contracts invalid unless there be some note oi" 
 memorandum signed by the parties sought to be charged, which note 
 or memorandum furnishes evidence of the material terms of such con- 
 tracts. Section 1238, C. C.^* The difference in the two classes of 
 statuteis was very fully noted in Jones v. Pettigrew, 25 S. D. 432, 127 
 N. W. 538, and in which we said : "Considering now the difference be- 
 tween these two classes of statutes — ^that under one the contract is 
 valid, but not enforceable without certain proof can be made, while 
 under the other the contract itself never becomes valid until it is en- 
 tered into (evidenced) in the manner prescribed by statute or unless 
 certain part performance prescribed by statute has taken place — we 
 see that, upon the trial, if one is attempting to prove a state of facts 
 which brings the particular case under the bar of a statute such as we 
 have in South Dakota, it would be an attempt to prove an invalid con- 
 tract by perfectly competent evidence; while in the other case it 
 would be an attempt to enforce a contract which, under the law, was 
 absolutely valid, but by means of incompetent evidence.'* 
 
 » * The words are : "The following contracts are invalid unless the same, 
 or some note or memorandum thereof, be in writing and subscribed by the 
 party to be charged, or by his agent." 
 
Sec. 7) THE LEGAL OPERATION OF THE STATUTE 1473 
 
 It follows that, under our statute, the rules of evidence would be 
 just as at the early common law. In case of the written contract the 
 writing is the only competent evidence. In case of an oral contract 
 the terms thereof may be estabhshed by parol. In case the rights of 
 a party rest upon an oral contract two questions are presented to the 
 court : What were the terms of the contract? Has the contract ever 
 been valida.ted by the party to be charged? Such oral contract can 
 only be validated by the party to be cliarged — the vendor in this case 
 — by his executing, over his signature, some memorandum or memo- 
 randa evidencing all those terms of the contract which affect the ven- 
 dee's right of recovery. Thus an oral contract may be entered into 
 where the whole contract is subject to certain conditions upon which 
 the right to enforce the contract depend. A memorandum of the 
 terms of such a contract, which memorandum omits all reference to 
 the conditions affecting such contract, might evidence all the terms es- 
 sential to a binding contract, and thus be sufficient prima facie evi- 
 dence to prove the terms of the contract as well as to prove that the 
 party executing such memorandum had validated such contract; but 
 yet, as a matter of fact, such oral contract would not have been vali- 
 dated, and the party against whom it was sought to be enforced would 
 be at liberty, in order to prove that such oral contract had not been 
 validated, to show by parol that there were essential terms or condi- 
 tions of such contract of which no written memorandum had been in- 
 troduced in evidence. 
 
 It must be remembered that, under our statute, the party sought to 
 be charged may admit every' term of the oral contract and yet rely 
 upon its invalidity under the statute of frauds. As was well said in 
 Fisher v. Andrews, 94 Md. 46, 50 Atl. 407, in speaking of a contract 
 coming under the provisions of another section of the statute of 
 frauds: "The principal object in making a memorandum of sale in 
 mercantile transactions is to comply with the requirements of the stat- 
 ute of frauds, and the general rule is that, if the memorandum does 
 not embrace all the material terms of the verbal contract, it is not suf- 
 ficient. It frequently happens, therefore, that in such cases parol evi- 
 dence is admitted, not for the purpose of varying or contradicting a 
 written agreement, as was suggested by the appellants that the appel- 
 lee was attempting to do, but to show that what [was] professed to be 
 a memorandum of the contract did not in fact truly state it, but had 
 omitted some essential terms that had been agreed upon in the verbal 
 contract. The case of Kriete v. Myer, 61 Md. 558, is a good illustra- 
 tion of the sufficiency of such memorandum. There a sold note was 
 given by the agents of the vendor, and it was held that the memo- 
 randum of sale need not state the time of the delivery if no time was 
 fixed in the parol /agreement, as the law would imply that it is, in 
 such case the duty of the seller to deliver the goods in a reasonable 
 time- or if there be an estabhshed custom among merchants dealing. in 
 such 'goods regulating the time of delivery, it will be controlled by such 
 
 CORBIN CONT 93 
 
1474 THE STATUTE OF FRAUDS (Ch. 10 
 
 custom. , But it was further held that, if a time for delivery be fixed in 
 the verbal agreement of sale, such time must be incorporated in the 
 memorandum, and, if it is not, it is insufficient." 
 
 In the case before us it is absolutely without dispute that the con- 
 tract was oral, and that, after the contract was entered into, appellant, 
 as vendee, made the advance payment that had been agreed upon, and 
 respondent executed to him a receipt for such payment. It is this re- 
 ceipt which appellant speaks of as a written contract, but which is in 
 fact but a memorandum of some or all of the terms of the oral con- 
 tract. It is this receipt or memorandum that the trial court held to 
 be "not a valid, binding and, legal contract for the sale of real estate." 
 The oral contract was entered into April 27th and the receipt or mem- 
 orandum was executed that day. The trial court finds: "That dur- 
 ing the negotiations between the plaintiff and defendant the defend- 
 ant stated in effect to the plaintiff that if he sold the land in controver- 
 sy to the plaintiff that he needed the money to meet bills that were 
 then coming due and wished to take advantage of the discounts allow- 
 ed on the bills if paid when due, and if the deal could not be closed by 
 May 1, .1915, he would not sell the land to the plaintiff." 
 
 Appellant contends that the above finding is unsupported by the 
 evidence. In this contention appellant is in error; such finding is 
 fully supported by undisputed testimony. The time of closing the 
 deal thus became a controlling provision of said contract, and there- 
 fore, even if the memorandum should be held to contain ample evi- 
 dence of all the terms essential to a complete contract, yet it does not 
 contain all the material terms and conditions of the contract that was 
 in fact entered into; and, for that reason alone, it remained invalid 
 under the statute of frauds. Moreover, it is perfectly clear that, if 
 there had been a written contract embodying therein this condition up- 
 on Which the continued binding force of such contract depended, and 
 such contract was not closed within the time provided by such condi- 
 tion, and this through no fault of the vendor, the vendor would be 
 released. It aippears without dispute' that upon examination of the 
 abstract of title appellant refused to accept the title as it appeared on 
 such abstract; that he received this abstract on April 28th; and that 
 at least one of the alleged defects could not, prior to May 1st, have 
 been cured in the method insisted on by appellant — an action in court 
 to quiet title. It was therefore up to appellant to accept the title and 
 close the deal or to allow the deal to fall through. To require specific 
 performance after May Ist would have been to compel respondent to 
 do what he had contracted against being compelled to do. 
 
 It might be urged that it appears from the* evidence that, after 
 May 1st, these parties were still negotiating with a view to a possible 
 closing of this deal. Even though this be so, it is immaterial in the 
 absence of a new and valid contract. Parties to an oral contract of 
 which there is no memorandum whatsoever may proceed with their 
 negotiations up to the very point of closing the deal by the delivery of 
 
Sec. 7) THE LEGAL OPERATION OF THE STATUTE 1475 
 
 a deed and the payment of the considerati6n therefor, and vet, at the 
 last moment, the vendor may lawfully elect to refuse to 'carry- out 
 such contract. At the best, such negotiations but furnish evideiice of 
 what the oral agreement was. In this case it is clear that respondent 
 did nothmg after May 1st which in any manner validated the oral 
 contract or which could estop him from alleging and relying uoon 
 Its invalidity. " 
 
 The record in this case peculiarly discloses' the importance of fore- 
 closmg all chance for innocent mistake or for actual fraud in transac- 
 tions of this kind by contracting in writing. If people see fit to en- 
 ter into invalid contracts, and thus rely upon each other's honor, they 
 must do so at their peril. 
 
 Under the views herein expressed it is clear that the judgment and 
 order appealed from should be, and they are, affirmed.^'* 
 
 °5 There is a difference in wording between sections 4 and 17 of the original 
 .statute; section 4 saying that "no action shall he brought" upon certain 
 contracts, and section 17 saying that "contracts * * * shall not be al- 
 lowed to be good." In Maddison v. Alderson, 8 App. Gas. 467, 488 (1883), 
 Lord Blackburn said: "I think it is now finally settled that the true con- 
 struction of the Statute of Frauds, both the fourth and the seventeenth 
 sections, is not to render the contracts within them void, still less illegal, but 
 is to render the kind of evidence required indispensable when it is sought to 
 enforce the contract." This was quoted with approval by several of the 
 Lords Justices in Morris v. Baron, [1918] A. 0. 1. In the Sale of Goods Act 
 the wording of section 17 was changed so as to agree with that of section 4. 
 
 It cannot be properly said that the statute lays down a mere rule of 
 evidence. It does not prevent proof by parol of the oral agreement, but 
 merely makes the oral acts of ofCer and acceptance inoperative to create a 
 legally enforceable right. Thus the parol agreement can be proved in a 
 quasi contractual suit for the value of services for fhe purpose cf showing 
 that they were not rendered as a gift. Laughnan v. Laughnan's Estate, 
 165 Wis. 348, 162 N. W. 169 (1917) ; Gay v. Mooney, 67 N. J. Law, 27, 50 
 Atl. 596 (1901). Also a parol gift of land can be proved to show that the 
 donee entered under claim of ownership and thereafter held adversely. 
 Pope V. Hogan, 92 Vt. 250, 102 Atl. 937 (1918). Parol evidence is admissible 
 to show that the oral agreement in fact contained a term not included in the 
 written memorandum, in order to nullify such memorandum. O'Neil v. Grain, 
 67 Mo. 250 (1878), agreed price of goods; Roe v. Naylor, 119 L. T. 359 (1918, 
 O. A.), the memorandum contained a term not in fact agreed upon. 
 
 Many decisions have held that the statute affects only the remedy, and 
 not the validity of the contract. See Townsend v. Hargi-aves, 118 Mass. 
 325 (1875) ; Bird v. Munroe, 66 Me. 337, 22 Am. Rep. 571 (1877) ; Buhl v. 
 Stephens (C. O.) 84 Fed. 922 (1898). And so in the leading case of Leroux 
 V. Brown, 12 O. B. 801 (1852), the statute was held to affect procedure 
 rather than substance, and the statute of the forum was applied lo prevent 
 the enforcement of a contract made in a jurisdiction having no such statute: 
 In Minnesota, however, it is held that the contract is enforceable there if 
 the memorandum complies with the lex loci contractus, even though it does 
 not satisfy the statute of Minnesota. Matson v. Bauman, 139 Minn. 296, 166 
 Jv W 343 (1918) ; Halloran v. Jacob Schmidt Brewing Co., 137 Miun. 141^ 
 162 N. W. 1082, L. B. A. 1917E, 777 (1917). 
 
 The actual decisions seeni to justify the statement that the statute confers 
 on a party who has not signed a memorandum a legal privilege not to perform 
 as he has orally agreed. He has the legal power of validating the contract 
 and creating a legal duty on himself, by signing a written memorandum; 
 the oral agreement, therefore, cannot be said to be void. The statute af- 
 fects substance, and not merely procedure, in that it determines the legal 
 
1476 THE STATUTE OF FRAUDS (Ch. 10 
 
 V^ations that are conseqaent upon the operative fac ts of offe r nnd nf?(; -npt- 
 ance. . Such a statute does not. apply to contracts made prior to its passage. 
 CoUin V. Kittelberger, 193 Mich. 133, 159 N. W. 482 (1916). 
 
 The more generally prevailing rule is that the Statute can be taken ad- 
 vantage of only by special plea and not under the general issue. See Browne, 
 Statute of Frauds, § 508 et seq. ; WiUiston, Contracts, § 527. It is often liela, 
 however, that if the declaration discloses a case in which the statute b:is 
 not been satisfied it is demurrable. Posten v. Clem, 201 Ala, 529, 78 South. 
 883, 1 A. L. R. 381 (1918) ; Evans v. Atlanta Paper Co., 21 Ga. App. 114, 
 93 S. E. 1023 (1917) ; Izard v. Connecticut Fire Ins. Co., 128 Ark. 433, 
 194 S. W. 1032 (1917) ; Clinton Sugar Eefining Co. v. Horras, 176 Iowa, 
 706, 158 N. W. 602 (1916). It is also often held that the defendant may 
 deny the contract and then present its proof by parol testimony. Ziegeuer 
 V. Daeche, 91 N. J. Law, 634, 103 Atl. 82 (1918) ; Robinson v. Cruzen 
 (Mo. App.) 202 S. W. 449 (1918) ; Pace v. Springer, 23 N. M. 586, 170 Pac. 
 879 (1918) ; Brown v. Kausche, 98 Wash. 470, 167 Pac. 1075 (1917) ; Cooley 
 V. Hatch, 91 Vt. 128, 99 Atl. 784 (1917) ; Walsh v. Standart, 174 Cal. 807, 
 164 Pac. 795 (1917) ; Alkire v. Alkirfe Orchard Co., 79 W. Va. 526, 91 S. 10. 
 384 (1917) ; Buttemere v. Hayes, 5 M. & W. 456 (1839). 
 
INDEX 
 
 [THE PIGtTBES REl'ER TO PAGES] 
 
 ABILITY, 
 
 To perform in the future, as a condition precedent, 842-866. 
 
 Implied condition of continuing, 842-866. 
 
 Of vendor of land, title at date of contract, 844, 857 n. 
 ABLE, 
 
 Promise to pay when able, 423, 437, 439, 491. 
 ACCEPTANCE, 
 
 By giving requested information, 17-36, 178. 
 
 By post, 27-51, 170. ' , 
 
 By telephone, 42 n. 
 
 By telegraph, 44, 102, 142. 
 
 By vote of a board, 64. 
 
 By shipment of goods ordered, 67 n, 92, 99. 
 
 By overt act, 52-80, 145, 189^205. 
 
 By parol, of written ofEer, 1444, 1458. 
 
 May be inferred by jury, 83, 88 n, 114. 
 
 Duration of power, 56, 141-205. 
 
 After time limited, 93 n. 
 
 Tacit, 52-80. 
 
 Silence as, 80-93. 
 
 Conditional, 94r-112, 180. 
 
 Lost or delayed in post, 27-42, 44, 73. 
 
 Of bid at auction, 163. 
 
 Of one bid not a rejection of others, 110. 
 
 Of bids and tenders, 9, 110, 163. 
 
 Of goods, to satisfy statute of frauds, 1375 n, 1438. 
 
 Of goods, to pass title, 1433. 
 
 Of delivery of deed by the grantee, 468 n. 
 
 Of guaranty bond, notice of, 469. 
 
 Of defective performance in building contracts, 650. 
 
 Of defective perforfitance as waiver of condition, 823. 
 
 Of an anticipatory repudiation as final, 767, 777, 788, 798. 
 
 Of offer made on Sunday, 1321 n. 
 ACCORD AND SATISFACTION, 979-1020. 
 
 By substituted contract, 965-979, 984. 
 
 By composition agreement executed, 1002. 
 
 Part payment as, 320, 328, 990-1013. 
 
 By performance by a third party, 1013, 1016. 
 
 As discharge of a specialty, 1020, 1021. 
 
 Revival of duty by new promise, 444r-448. 
 
 ACCORD EXECUTOBX, . . , • n«A o™ 
 
 Distinguished from substituted contract and compromise, 966-979. 
 As an enforceable executory contract, 984, 987-1001. 
 As a bar or suspension of a right of action, 979-987. 
 Revival of original right on breach of a composition, 987, 987 n. 
 EfCect of, where original contract is a specialty, 992. 
 May be a mere unaccepted offer, 995. 
 Specific enforcement in equity, 1000. 
 
 ACCOUNT STATED, . 
 
 As consideration for a promise, 389 n, 406. 
 
 COBBIN CONT. (1477) 
 
1478 ixDBx 
 
 [The figures refer to pages] 
 
 ACKNOWLEDGMENT, 
 
 By infant after majority, 409, 410. 
 
 Of a barred debt, 423. 
 
 Of debt discharged In bankruptcy, 439. 
 
 See Past Consideration ; Ratification ; Waiver. 
 
 ACQUITTANCE, 
 
 Under seal, 928-944, 953, 1005, 1022. 
 
 ACT OF GOD, 
 
 Making fulfilment of condition impossible, 870, 877. 
 Making performance of duty impossible, 877, 879. 
 
 ADEQUACY, 
 
 Of consideration, 206-222. 
 
 ADMINISTRATOR, 
 
 Promise of, within statute of frauds, 1374. 
 
 ADVERTI SEMENT, 
 
 Offer by, 64, 178, 193. 
 
 ADVOWSON, 
 
 Church appointment as a consideration, 391. 
 
 AFFREIGHTMENT CONTRACT, 
 Implied condition In, 693. 
 Delivery at destination, 696 n. 
 
 AGENCY, 
 
 Of real estate broker, power of rtn-ocation, 194^202. 
 As basis of rights of third party beneficiary, 1050, 1088. 
 
 AGENT, 
 
 Post office as, 31, 46. 
 
 Telegraph company as, 118. 
 
 To sell real estate, 19't-202. 
 
 Right to compensation for Illegal service, 1265, 1270. 
 
 Contract Inducing breach of trust by, 1334, 1344, 1346. 
 
 Letter of authority to, is not a memorandum of sale, 1458. 
 
 Del credere, promise not within statute of frauds, 1390, 1391 n. 
 
 Contract to buy land for principal, when within statute of frauds, 1398. 
 
 Signature by, 1445. 
 
 Written authority not required by statute of frauds, 1446 n. 
 
 AGGREGATI.0 MBNTIUM, 87, 112-141, 145, 170. 
 
 See Offer and Acceptance ; Acceptance, Conditional ; Mistake. 
 
 ALEATORY CONTRACT, 
 
 Consideration in, 295, 296. 
 Conditions in, 685-691, 739. 
 As wagers, 1259 n. 
 
 See Wagering Contracts. 
 
 ALIENABILITY, 
 
 Of choses in action, see Assignment. 
 
 ALIMONY, 
 
 Fixed by agreement, 1315 n. 
 
 ALTERATION, 
 
 Of a document, as a discharge, 1026-1030, 
 
 ALTERNATIVE CONTRACT, 
 
 Effect of impossibility, 882, 883. 
 One alternative being illegal, 1371 n. 
 
 AMENDMENT, 
 
 Setting up a new cause of action, 963. 
 
[The figures refer to pages] 
 ANTENUPTIAL CONTRACT 
 
 When within statute of 'frauds, 1394-1397 
 
 Consideration, for, 382 . 
 ANTICIPATORS BREACH, 
 
 By repudiation, 729-806. 
 
 Bankruptcy as, 750 n. 
 
 In case of commercial paper, 757, 764 n. 770 
 
 Measure 01 damages, 784-806. 
 See Repudiation. 
 APPORTIONMENT, 
 
 Of rewards, 23. 
 
 APPRAISAL, 
 
 By third person, as a condition, 493, 496 500 
 Not an award of arbitrators, 1032 n. 
 APPRENTICESHIP, 
 
 Contract of, partial breach, 539. 
 APPROVAL, 
 
 Goods purchased on approval or on trial, 674 677 
 ARBITRAMENT, 
 
 Distinguished from accord, 982 n. 
 ARBITRATION AGREEMENT, 
 
 Mutual promises as consideration, 293. 
 
 Refusal of aribitrators to act, 875 n 
 
 When held illegal, 1294-1312. 
 
 Relate to remedies, and depend on law of forum 1301 
 
 Limited to question of amount of loss, 1303 
 
 When a condition and when a collateral independent covenant, 1303 
 
 Collateral promise to arbitrate, 500 n. 
 
 Eiffect of revocation, 1308. 
 
 Action for damages for breach of, 1309. 
 
 Award properly rendered is final and conclusive, 1311 1312 n 
 
 Arbitration statute of New York, 1313 n. 
 
 ARBITRATION AND AWARD, * 
 
 Discharge by, 1030-1036. 
 Debt lies on award, 1032 n. 
 Revocation of submission, 1031, 1034. 
 As a condition precedent, 481, 496, 500. 
 
 ARCHITECT, 
 
 Certificate of, as a condition, 628-647, 670. 
 Certificate prevented by defendant, 811. 
 Waiver of certificate, 824, 840. 
 As an arbitrator whose award is final, 1311, 1312 n. 
 
 ARREST, 
 
 Of tenant, effect on lease, 863. 
 Reward for, 19, 24, 178. 
 
 ASSIGNEE, 
 
 Rights of, as against 
 
 Trustee in bankruptcy of assignor, 1112, 1127, 1155. 
 
 Assignor's creditors, 1112, 1127. 
 
 Assignor or his representative, 1116, 1122 n. 
 
 Subsequent assignees and attaching creditors, 1143-1155. 
 His rights are conditional and subject to defenses, 1139, 1141. 
 
 ASSIGNMENT, 1111-1185. 
 
 By power of attorney, 1111, 1112. 
 
 Rights of assignor after, 1126. 
 
 Power of assignor to discharge, after, 1116, 1121, 1122. 
 
 Rights of assignee, at common law, 1111-1124. 
 
1480 INDEX 
 
 [The figures reler to pages] 
 
 ASSIGNMENT— Continued, 
 
 Rights of assignee in equity, 1111, 1125, 1127. 
 
 By buyer, of rights under a conditional sale, 1178. 
 
 May or may not operate as a repudiation, 1158, 1171 n, 1178. 
 
 By parol, 1120, 1135. 
 
 Notice of, given to debtor, efCect, 1122, 1124 n, 1139, 1141, 1143-1154. 
 
 Without consideration, as a gift; 9p4, 1130-1139. 
 
 Payment to assignor before notice, 1143. 
 
 Defenses and equities of debtor, 1139, 1141. 
 
 Equities of third persons, 1141 n. 
 
 Expressly prohibited, 1160, 1171, 1173, 1182 n. 
 
 Survival to personal representative as test of assignability, 1159. 
 
 In fraud of creditors, 1173. 
 
 Distinguished from novation, 962 n, 963, 1159 n, 1171 n. 
 
 Negotiable instruments, 1114. 
 
 Effect of bankruptcy of assignor, after, 1112, 1118. 
 
 Successive assignees of same right, 1143-1155. 
 
 As security only, 1146-1154. 
 
 By a promisee, to a third party beneficiary, 1086 n, 1182. 
 
 For creditors, as a repudiation, 849 n. 
 
 When invalid for champerty, 1288 n. 
 
 Of unmatured or conditional rights, 1127, 1139, 1141, 1158-1182. 
 
 Of future book accounts, 1127. 
 
 Of bank account, 1132, 1134 n. 
 
 Of option contract, by vendor, 855. 
 
 Of option to purchase, 1178. 
 
 Of part of a claim, 1154, 1155, 1173. 
 
 Of a legal pov^er, 1159, 1178. 
 
 Of duties, personal performance as a condition precedent, 1158-1182. 
 
 Of secondary rights to damages, 1182, 1185 n. 
 
 Of chose in action by gift, 954, 1130-1139. 
 
 Of rights, is not assignment of duties, 1171 n, 1173. 
 
 Of street-cleaning contract, 1158. 
 
 Of car-repairing contract, 1162. 
 
 Of hire-purchase agreement, 1178. 
 
 Of ore-sampling and buying contract, 1166. 
 
 Of salary by public officer is illegal, 1338. 
 
 ASSETS, 
 
 Held in trust for contract beneficiary, 1059, 1066, 1089, 1094 n, 1103, 1182. 
 
 ASSUMPSIT, 
 
 Consideration required, 206-222. 
 
 ATTACHING CREDITOR, 
 
 Rights as against previous assignee, 1149 n. 
 
 ATTORNEY AT LAW, 
 
 Contract inducing breach of trust, 1346. 
 Contract for contingent fee, 1278-1288. 
 
 AUCTION, 
 
 Sale at, effect of bid, 163. 
 
 AUCTIONEER, 
 
 Memorandum by, binds both parties, 1446 n. 
 
 AWARD, 
 
 Of arbitrators, as a condition precedent, 481, 496, 500. 
 
 Notice of, as a condition, 680. 
 
 EfEect of refusal of arbitrators to render, 875 n. 
 
 Of arbitrator is conclusive on the parties, 1311. 
 
 See Arbitration and Award. 
 
 BAIL, 
 
 Promise to indemnify one vrho becomes, 1383 n. 
 
INDEX 1481 
 
 [The figures refer to pages] 
 BAILMENT, 
 
 Gratuitous, 211, 228, 231. 
 
 BANKRUPTCY, 
 
 Revival of debt after discliargc, 435^43. 
 As an anticipatory breacli, 750 n, 882 n. 
 Assignment in, 1111. 
 
 Of assignor, after the assignment of a right, 1112, 1118. 
 BENEFICIARY, 
 
 Of insurance contract, interest of, 709. 
 Of insurance policy, rights of promisee, 768, 771, 775 n. 
 Of contracts made by others, 876, 1040-1110. 
 See Third Party Beneficiaries. 
 
 BENEFIT TO PROMISOR, 
 
 Received in the past, as a consideration, 887-454. 
 What constitutes, 206-222. 
 
 Performance of legal duty by promisee, 320-387. 
 See Consideration. 
 
 BETROTHMENT, 
 
 As a "status," 763. 
 
 BETTING, 
 
 See Wagering Contracts. 
 
 BID, 
 
 Unilateral mistake in, 121, 124. 
 
 At auction sale, 163. 
 
 May be irrevocable, 164 n. 
 
 For a contract, as an offer, 9, 110. 
 
 At auction or in competition, fraud and collusion, 1348, 1353 n. 
 
 BILATERAL CONTRACT, 
 
 Compared with unilateral, 236, 283-292, 298, 80O, 315, 832, 613. 
 Mutual promises as consideration, 292-319. 
 Order of performance by the two parties, 508. 
 Evidenced by several writings, 557 n. 
 Conditional promise, mutuality, 838. 
 
 Illusory promises, condition of personal satisfaction, 675. 
 Effect of reserved power to cancel, 718 n. 
 Aleatory in character, 295, 296, 685-691, 739. 
 By implication, 189-205, 309. 
 See Unilateral Contract. 
 
 BILL OF EXCHANGE, 
 
 Assignable by law merchant, 1114. 
 See Negotiable Instrument. 
 
 BLANKS, 
 
 Effect of delivery of incomplete document, 465 n. 
 
 BLOOD RELATIONSHIP, 
 
 Effect on rights of beneficiaries, 1041, 1043, 1048, 1061, 1066, 1069, 1073. 
 See Third Party Beneficiaries. 
 
 BOND, 
 
 Under seal, 462. 
 
 BOOK ACCOUNTS, 
 
 Assignment of, 1127. 
 
 BOOKS AND INVENTORY, 
 As condition precedent, 484. 
 
 BOUNDARY LINE, ' 
 
 Parol compromise agreement, 1411. 
 
1482 INDEX 
 
 [The figures refer to pages] 
 
 BREACH, 
 
 Anticipatory, 729-806. 
 
 By making improper tender and demand, 77S. 
 
 Going to essence, see Conditions. 
 
 Of promise to marry, 858, 1185 n. 
 
 Of promise, right to damages not assignable, 1185 n. 
 
 Of duty by preventing performance, 807-822. 
 
 Of trust, contracts inducing, 1325, 1334^1348. 
 
 Discharge by parol, before or after, 948-957. 
 
 Substituted contract, before or after, 965-979. 
 
 Of composition agreement revives orlgiioal debt, 987, 987 n. 
 
 Accord executory, before or after, 999 n. 
 
 Total breach, one action only, 664. 
 
 See Conditions ; Damages ; Repudiation ; Quasi Contract. 
 
 BROKER, 
 
 To sell real estate, 19-t-202. 
 
 Right to commission, when sale falls through, 808, 810. 
 Right to compensation for illegal service, 1265, 1270. 
 Requirement of license, 1358 n, 1359. 
 
 BUILDER'S BOND, 
 
 Delay in furnishing, 833. 
 
 Rights of laborers and materialmen, 1095-1103, 1107 n. 
 
 BUILDING CONTRACTS, 
 Conditions in, 514, 589. 
 Certificate of architect, 628-647, 670. 
 Substantial performance, 647-660. 
 Quantum meruit for plaintiff in default, 647. 
 Counterclaim against a plaintiff in default, 647, 656. 
 Satisfaction of owner as a condition, 647, 670, 675. 
 Effect of destruction by fire, 913. 
 Liquidated damages for delay, 813, 831. 
 Assignment of progress payments, 1171. 
 Invalid arbitration clause in, 1298. 
 
 BUILDINGS, 
 
 Effect of destruction, on contract to sell the land, 522 n. 
 In leasing contracts, 701. 
 
 BURDEN OF PROOF, 
 
 Of false representation, 707. 
 
 Of condition subsequent, 707, 712. 
 
 Of condition precedent, 707, 709. 
 
 CANCELLATION, 
 
 Of contract for mistake, 121. 
 
 Power of, reserved in contract, 42 n, 314 n, 718 n, 957 n, 1420. 
 
 Of instrument as a discharge, 945-948. 
 
 Of order as a repudiation, 788. 
 
 CASUAL CONDITION, 480. 
 
 CAUSA AND CONSIDERATION, 206, 222. 
 See Consideration ; Motive ; Reliance. 
 
 CAUSE OF ACTION, 
 
 New promise as ratification of a barred debt, 406, 415, 427 n, 439 n, 439. 
 
 Must not be split, 664. 
 
 Condition precedent is a part of, 728 n. 
 
 Anticipatory repudiation as, 742-806. 
 
 Temporary suspension of, 936, 937. 
 
 Suspension of, by acceptance of a Negotiable note, 942. 
 
 Amendment setting up a new, 963.' ' 
 
INDEX 1483 
 
 [The figures refer to pages] 
 
 CERTIFICATE, 
 
 Of physician, as condition precedent, 489. 
 
 Of architect or engineer, 489, 628-647, 670. 
 
 Of satisfaction, 636. 
 
 Of architect, prevented by defendant, 811. 
 
 Waiver of, 824, 840. 
 CHAMPERTY, 1273-1288. 
 
 Fomenting and soliciting suits, 1278-1286. 
 
 No defense that plaintiff and his attorney are guilty of, 1286. 
 
 Abolished by statute, 1284. 
 
 Illegal assignment for, 1285, 1288 n. 
 
 CHANGE IN LAW, 
 
 Making performance unlawful, 899. 
 
 CHARITABLE SUBSCRIPTIONS, 242, 245. 
 Action by beneficiary, 1065 n. 
 
 CHARTER PARTY, 
 
 Conditions precedent, 492, 692-696. 
 
 CHECK, 
 
 For part of disputed claim, as satisfaction, 328, 1006, 1009. 
 Of donor, gift of, 1138. 
 
 CHOSE IN ACTION, 
 
 Oral contract for sale of, 1435. 
 See Assignment. 
 
 CLOSED SHOP, 
 
 Contract to maintain, 1247 n. 
 
 CODE TELEGRAM, 
 
 Mistake arising from, 118 n. 
 
 COLLUSION, 
 
 Between owner and architect to refuse certificate, 811. 
 Between bidders, 1348, 1353 n. 
 
 COMBINATION, 
 
 To suppress competition in bidding, 1348, 1353 n. 
 See Restraint of Trade. 
 
 COMMERCIAL PAPER, 
 
 Anticipatory breach of, 757, 764 n, 770. 
 
 COMMUNICATION, 
 Of offer, 17-27. 
 
 Of acceptance, 52-80, 145-162. 
 Of acceptance by post, 27-51, 170. 
 Of abandonment of contract, 77. 
 Of revocation of offer, 163-180. _ 
 Of acceptance in option contracts, JM6. 
 
 COMPETITION, . . X m 1 
 
 Restraint of, see Restraint of Trade. 
 
 COMPOSITION WITH CREDITORS, 
 Consideration for, 252, 328 n. 
 New promise to pay balance, 439, 445. 
 Operative effect of, 979-1013. 
 Revival of original debt on breach of, 987, 987 n. 
 Fraudulent preferences, 1353. 
 See Accord Executory. 
 
 COMPOUNDING, io«q_12c»'? 
 
 Felonies and misdemeanors, 1289-LJ»3. 
 
1484 INDEX 
 
 [The figures refer to pages] 
 
 COMPROMISE, 
 
 Consideration for, 272-292. 
 
 Of a claim doubtful as matter of law, 274, 277. 
 
 Distinguished from accord executory, 969, 979. 
 
 Effect of tender of performance, 979-986. 
 
 As to boundary lines, by parol, 1411. 
 
 CONDITIONAL, 
 
 Acceptance, 94r-112, 130, 145. 
 
 Delivery of deed, 467 n. 
 
 Delivery of release, 930, 933, 987 n. 
 
 Duty, definition of, 478. 
 
 Payment, 1016 n. 
 
 Power, 699 n, 717, 719. 
 
 Power to terminate 'contract, 957 n. . 
 
 Promise, as consideration, 295, 296, 303. 314 n, 492, 718 n. 
 
 Ratification, 410, 423, 437, 439. 
 
 Repudiation, not a breach, 750. 
 
 Right, assignment of, 1139, 1141, 1149. 
 
 CONDITIONAL SALE, 
 
 Power of assignment by buyer, 1178. 
 
 With knowledge of buyer's illegal purpose, 1365. 
 
 CONDITIONS, 
 
 Compared with consideration, 222, 228, 235 n, 245, 248. 
 
 Classified and defined, 478-480. 
 
 Distinguished from promises, 480, 718 n. 
 
 Excuse for nonfulfilment, 703. 
 
 Waiver of, 823-842. 
 
 Pleading and burden of proof, 702-728. 
 
 CONDITIONS CONCURRENT, 478, 511 n, 512-522, 555, 736, 844, 860. 
 In land contract, 776, 844. 
 
 CONDITIONS PRECEDENT, 
 Defined, 478. 
 
 Express, 480-504, 628-647, 670, 661-679, 1059. 
 Implied and constructive, 478, 504-702. 
 Act by plaintiff necessary before performance by defendant is possible, 
 
 507, 722. 
 Rules of Sergt. Williams, 510 n. 
 Rules of Lord Mansfield, 513, 851. 
 Independent promises, 479, 504, 508, 510 n, 522-533. 
 Dependent promises, 479, 504, 510 n, 522, 849. 
 Installment contracts, 521, 522, 529, 550-605. 
 Performance on time as a condition, 575, 606-617. 
 Time of the essence, 575, 606-617. 
 Certificate of 'architect, 628-647. 
 
 Substantial performance as a condition, 639, 64Y-660. 
 Award of arbitrator as an illegal condition, 1298, 1301. 
 Award, limited to question of loss, as a valid condition, 1303. 
 Valuation by a third person, 493, 496, 500. 
 Giving of security, 512, 514, 833. 
 Personal satisfaction as a condition, 661-079. 
 Notice, as a condition, 680-685, 1095., 
 In aleatory contracts, 685-691. 
 In charter parties, 492, 692-696. 
 In leases', 681 n, 682,' 696-702. 
 In building contracts, 514, 589, 628-660; 670, 675. 
 In sales of goods, 507-517, 536, 537, 544, 560, 564-606, 722, 734, 788. 
 In sales of land, 508, 518-528, 533, 551, 555, 609, 731, 733, 736, 776, 7ffi, 
 
 838, 844, 859, 860.. ■ ■ , ' " 
 
 In contracts for benefit of third persons, 1095, 1105, 1108. 
 In contracts of service, 617-628. 
 
INDEX 1485 
 
 [The figures refer to pages] 
 
 CONDITIONS PRECEDENT— Continued, 
 In insurance contracts, 484, 489, 496, 500. 
 In option contracts, 492, 493, 610, 613. 
 In total requirement contract, 601. 
 
 Prevention of fulflUment, by defendant, 808-822, 874, 1467. 
 Waiver of, by repudiation, 729-739, 747, 757, 762. 
 Waiver of, by making performance impossible, 731, 733, 758, 858. 
 Continued existence of subject-matter, 888, 892, 897-910. 
 Ability to pay as a condition, 423, 437, 439, 491, 842. 
 Ability to perform in the future as, 842-866. 
 Impossibility caused by war, 866. 
 
 Strikes, flres, and causes beyond control, 488, 721, 918. 
 Of possibility of performance, see Impossibility. 
 Re-establishment by notice after a waiver, 833, 837 n. 
 By parol, to operative effect of a document, 1190. 
 Release subject to, 933. 
 
 Personal performance by an assignor, 1158-11^. 
 Pleading and burden of proof, 707, 709, 712, 721, 722. 
 
 CONDITIONS SUBSEQUENT, 702-721. 
 In Insurance policies, 702, 703, 707, 709. 
 Defined, 705. 
 
 Burden of proof, 707, 712. 
 Distinguished from covenants, 718 n. 
 Release subject to, 930, 987 n. 
 
 CONFLICT OF LAWS, 
 
 As to statute of frauds, 1475 n. 
 
 CONSIDERATION, 206-454. 
 Early development, 228-222. 
 Necessary for written promise, 220. 
 Void in part, 220. 
 
 ReUance on promise as, 222-252, 362, 376. 
 In gratuitous bailment, 211, 228, 231. 
 Forbearance as, 252-292. 308, 332, 338. 
 Compared with condition, 222, 228, 235 n, 245, 248, 997. 
 Must it move from the promisee, 245, 245 n, 252 (top). 
 Compared with motive, 222, 226, '248. 
 
 As th^conventlonal inducement, 222, 226, 248, 262, 263, 362. 376. 
 Release of dower as, 260 n. 
 For a compromise, 272-292. 
 Promise for a promise, 292-319. 
 In aleatory contracts, 295, 296. 
 Conditional promise as, 295, 296, 303, 314 n, 492. 
 Illusory promises, 298, 300, 315. 
 Implied promise, 309. 
 Of marriage, 362, 376, 382. 
 
 Past consideration, 387-454. .„„ .,„^ ^o. i£m iqs i«q ooo 
 
 As affecting revocation of an offer, 166, 174, 181, 184, 185, 189-202. 
 Promise to pay interest as, 340. 
 Privilege of naming child, 1073. 
 Performance of pre-existing duty, 320-387, 1009. 
 Pre-existing duty to the promisor, 320-360 
 Pre-existing duty to a third P^son, 360-3^. 
 Pre-existing public or official duty, 19, 381-387 
 Effect of unexpected expense and hardship, d50, d&a. 
 For promises under seal, 471-477. _ 
 
 Presumption of, in sealed contracts, 471-477, 928, 930. 
 In contract to supply all needs or requirementp, 303. 
 In option contracts, 298-319. 
 
 JjVbSf KSo^al^Sg^^^^^^^^^ Of statute of frauds, 1384, 1385. 
 1391 n. 
 
1486 INDEX 
 
 [The figures refer to pagea] 
 
 CONSIDERATION— Continued, 
 
 Of marriage, statute of frauds, 1394^1397. 
 
 Illegal in part, 1315 n. 
 
 Renewal of marital relations as, 1315. 
 
 Assignment of chose in action without, 1130-1139. 
 
 Not necessary for a waiVer, 830. 
 
 Partial failure of, 533-549, 722, 849; 
 
 CONSTABLE, 
 
 Performance of duty as a consideration, 384. 
 
 CONSTRUCTION CONTRACT, 
 
 See Building Contracts. 
 CONSTRUCTION OE CONTJEIACT, 478. 
 
 CONSTRUCTIVE CONDITIONS, 478, 504-702, 722. 
 See Conditions. 
 
 CONSTRUCTIVE CONTRACT, 134. 
 See Quasi Contract. 
 
 CONSTRUCTIVE SERVICE, 
 Doctrine of, 794. 
 
 CONTINGENCY, 
 
 Oral contract performable upon an uncertain, 1414. 
 See Conditions. 
 
 CONTINGENT FEES, 
 
 For securing lefislation or public contracts, 1325-1337. 
 See Champerty. 
 
 CONTINUING GUARANTY, 181, 184. 
 
 CONTINUING OFFERS, 181, 184, 185, 298. 
 
 CONTRA PROFERENTEM, 
 Interpretation, 124 n. 
 
 CONTRACTS, 
 
 For the benefit of third persons, 1040-1110. 
 See Third Party Beneficiaries. 
 CONTRACTS UNDER SEAL, 455-477. 
 
 What is a seal, 455-462. 
 
 Signing, 462. 
 
 Delivery, 464-468. 
 
 Witnessing clause, 463. 
 
 Consideration, 471-477. 
 
 To be performed after death, 474. 
 
 Rights of beneficiaries, 1103. 
 
 Conditions in, 508. 
 
 Parol evidence admissible to prove illegality, 1276. 
 
 CONTRIBUTION, : 
 
 Promise of, by a co-surety, 361. 
 
 As against executor of a deceased co-surety, 1194 n. 
 
 CONVEYANCE, 
 
 Of land to a third person, by a vendoj, as a breach, 844, 855. 
 
 CORONATION CASES, 910 n. 
 
 CORPORATE OFFICERS, 
 
 Illegal agreements to influence action of, 1343 n. 
 
 CORPORATIONS, 
 
 Dissolution of, effect on contra;ct, 882 n. 
 
 CORRESPONDENCE, ' 
 
 Contracts by, 27-51, 102-109; 141-162, 16&-173. 
 
INDEX J^^.g'J 
 
 [The figures refer to pages] 
 COUNTERCLAIM, 
 
 For partial breach by the plaintiff, 533-549 
 r.r.rZ ""'"*«°'i°'>al breach in a building contract, 647, 656. 
 COUNTERMAND OF ORDERS, Igr 
 
 See Revocation of Offer. 
 COUNTER OFFER, 93 n. 
 
 As a rejection, 94-112. 
 
 Mere counter inquiry, 102, 107 
 
 Not an acceptance, 130. 
 COURTS, 
 
 Illegal agreements to oust jurisdiction, 1294-1312 
 COVENANT, 
 
 Distinguished from condition subsequent, 718 n. 
 
 Not to sue, as a discharge, 711, 928-944. 
 
 Not to use statute of limitations as a defense 421 
 See Contracts under Seal. 
 CREDITOR BENEFICIARIES, 
 
 Of contracts made by others, 1045-1060, 1075-1110 
 See Third Party Beneficiaries. 
 CRIME, 
 
 Contracts inducing, 1322. 
 CRIMINAL PROSECUTION, 
 
 Agreement to settle, 1289-1293. 
 CROP FAILURE, 
 
 As causing impossibility, 897. 
 CROPS, 
 
 Planted annually are not land, 1403 n. 
 
 DAMAGES, 
 
 Liquidated, 110, 609, 722. 
 
 Measure of, 729. 
 
 In case of repudiation, 784-806. 
 
 Mitigation of, after repudiation, 251, 529, 664, 786-806. 
 
 To accrue in the future, 664, 748, 784. 
 
 Waiver of right to, 831. 
 
 Assignment of right to, 1182, 1185 n. 
 DANGER, 
 
 To life or property as excuse for nonperformance, 924. 926 n. 
 DEATH, 
 
 Of offeree after acceptance, 145. 
 
 Of offeror as revocation, 170, 177, 183. 
 
 As revocation of offer, 244. 
 
 Contract to be performed after, 474. 
 
 In common disaster, 709. 
 
 As a discharge of duty, 877, 879. 
 
 Of employer, 879. 
 
 Of employee, 882 n. 
 
 Of contractor, when not a discharge, 1161. 
 
 Of one joint obligor, effect of, 1193. 
 
 Of one joint obligee, effect of, 1201. 
 
 Possibility of within one year, 1414, 1417, 1418. 
 
 DEBT, 
 
 Action of, consideration, 206-222. 
 
 Pre-existing debt as consideration for a promise, 388. 
 
 Distinguished from damages, 522, 529. 
 
 Does not lie for price unless title to goods has passed, 788, 793 n. 
 
 Does not lie for contract wage after a wrongful discharge, 664, 742, 794. 
 
 Unilateral, discharge by parol, 949-957. , 
 
1488 INDEX 
 
 [The figures refer to pages] 
 
 DEBT— Continued, 
 
 Discharge by payment or tender, 957. 
 
 Payment of a less sum no satisfaction, 320, 990-1013. 
 
 Payment by a third person, 1013, 1016. 
 
 Promise to answer for debt of another, 1374r-1394. 
 
 DEED, 
 
 Defined, 455. 
 Merger' by, 1037. 
 
 DEFECTIVE PERFORMANCE, ^ 
 
 Acceptance of, as waiver of condition, 823. 
 By seller, effect on buyer's duty, 582, 584. 
 
 DEL. CREDERE AGENT, 
 
 Promise of, not within statute of frauds, 1390, 1391 n. 
 DELAY, 
 
 Caused by strikes; responsibility for, 918. 
 
 In mails, effect on acceptance, 27-42, 44, 73. 
 
 In performance, caused by other party to contract, 813, 831, 1467. 
 
 In giving builder's bond,. 833. 
 
 DELIVERY, 
 
 Of deeds, 457, 464-468. 
 
 Of insurance policy, 68. 
 
 Of goods as a condition, 562-566, 572. 
 
 Deftective quality of goods, 5^, 584. 
 
 At destination, as condition precedent to freight, 696 n. 
 
 Of a sealed release on parol condition, 930, 933, 987 n. 
 
 Necessary to make an effective gift, 954. 
 
 Of chose in action, what constitutes, 1132, 1135. 
 
 Of goods to carrier is not an acceptance by buyer, 1440 n. 
 
 DEMAND, 
 
 For payment as condition precedent, 487. 
 Waiver of, 482. 
 
 DEPARTURE IN PLEADING, 704, 841 u,. 
 
 DEPENDENT PROMISES, 479, 504; 510 n, 522, 555. 
 Rules of Serjt. Williams, 510 n. 
 Rules of Lord Mansfield, 513, 851. 
 See Conditions. 
 
 DEPOSIT, 
 
 To be forfeited on condition, 110. 
 
 DESTRUCTION, 
 
 Of subject-matter, making performance impossible, 888, 892, 897-910. 
 
 Of means of performance, 924 n. 
 
 Of buildings, effect on land sale, 522 n. 
 
 Effect on duty to pay rent, 701. 
 
 DETRIMENT TO PROMISEE, 
 What constitutes, 206-222. 
 
 Performance of legal duty as a detriment, 320-387. 
 See Consideration. 
 
 DIFFERENCES, 
 
 Wagering contracts to pay, 1265, 1270. 
 
 DIFFICULTY AND EXPENSE, 
 
 As excuse for nonperformance of duty, 910-927. 
 
 DIRECTORS, 
 
 Illegal agreements to Influence action of, 1343 n. 
 
 DISAFFIRMANCE, 
 
 Of contract, for fraud, 137. 
 
INDEX 1489 
 
 [The figures refer to pages] 
 DISCHARGE, 
 
 In bankruptcy, revival by new promise, 430-443. 
 
 By release, revival by new promise, 444r-44S. 
 
 Of duty by impossibility, 877-927. 
 
 By death of employer, 879. 
 
 Of servant or employee, 617-628, 662, 664, 1453. 
 
 For insufficient reason, a good reason existing, but unknown, 625. 
 
 Of servant, compulsory vacation is not, 820. 
 
 Of servant wrongfully, measure of recovery, 664, 742, 794. 
 
 Of principal contract, effect on sub-contract, 875. 
 
 Of right to damages by waiver, 831. 
 
 Of sealed contract by parol, 346, 1020-1025. 
 
 Of written contract, within statute of frauds, by parol, 1467, 1468 n. 
 
 Power of promisee, as against a beneficiary, 1078, 1085, 1103, 1105. 
 
 Of joint contracts, see Joint Contracts. 
 
 DISCHARGE OF CONTRACT, 928-1039. 
 
 By release or covenant not to sue. 928-944. 
 
 By surrender and cancellation, 945-948. 
 
 By parol exoneration and rescission, 948-957. 
 
 By gift, 952. 
 
 By payment or tender, 957. 
 
 By novation or substituted contract, 959-979, 984.. 
 
 By accord and satisfaction, 979-1020. 
 
 By alteration, 1026-1030. 
 
 By arbitration and award, 1030-1036. 
 
 By merger, 1037-1039. 
 
 Of specialties, 1020-1025. 
 
 By exercise of power expressly reserved, 42 n, 314 n, 718 n, 957 n, 1420. 
 
 DISEASE EPIDEMIC, 
 
 As excuse for nonperformance, 926 n. 
 
 DISHONOR, 
 
 Waiver of notice of, 432. 
 
 DISREPAIR, 
 
 Notice of, as condition precedent, 682, 681 n. 
 
 DISSOLUTION OF CORPORATION, 
 
 Effect on contract, 882 n. 
 DIVISIBLE CONTRACT, 
 
 In restraint of trade, 1217 n. 
 
 Service illegal in part, 1372. 
 
 Where subject-matter is burned, 902. 
 See Installment Contracts. 
 
 DIVORCE, 
 
 Illegal agreement to facilitate, 1315 n. 
 
 Illegal contract to marry after obtaining, 1369 n. 
 
 J)ONATIO CAUSA MORTIS, 1132, 1135. 
 
 DONATION, 
 
 For charitable purposes, 242, 245. 
 
 DORMANT PARTNER, 
 
 Discharged by judgment against others, 1199. 
 
 DOUBTFUL CLAIM, 
 
 Compromise of, 272-292. 
 
 DOWER, 
 
 Release of as consideration, 260 n. 
 
 DROUTH, . 
 
 Making performance impossible, 924 n. 
 
 COKBIN CONT.— 94 
 
1490 INDEX 
 
 [The figures refer to pages] 
 
 DURATION, 
 
 Of power to accept, 56, 141-205. 
 
 As long as offeror actually' intends, 154. 
 
 DUTY, ' 
 
 To mitigate damages, 794 n, 804. 
 Conditional, see Conditions. 
 
 EASEMENT, 
 
 Contract for right of way is witliin statute of frauds, 1397. 
 
 ECONOMIC UNPROFITABLENESS, 
 
 As excuse for nonperformance, 921, 928 n. 
 
 ELECTION, 
 
 To treat a repudiation as final, 767, 777, 788, 798. 
 Between rights, by a third party beneficiary, 1110 n. 
 
 EMBEZZLEMENT, 
 
 Settlement by embezzler, 1291. 
 
 ENGAGEMENT TO MARRY, 
 Consideration for, 293. 
 Repudiation of, 763. 
 Breach by marrying another, 858. 
 Not within statute of frauds, 1396 n. 
 
 ENGINEER, 
 
 Certificate as a condition, 628-^647, 670. 
 
 ENHANCEMENT OF DAMAGES, 
 See Mitigation of Damages. 
 
 ENTIRE CONTRACT, 
 
 Successive actions do not lie after a vital breach, 784, 794. 
 See Installment Contracts. 
 
 EQUITABLE INTEREST, 
 
 Of assignee, enforced at law, 1112, 1116. 
 Of a partial assignee, 1154, 1155, 1173. 
 
 EQUITY, 
 
 Recognition of rules of, by common law, 1115. 1119. 
 Relief for mistake, 121, 124. 
 
 ESCROW, 
 
 Delivery in, 465-468. 
 
 ESSENCE OF CONTRACT, 
 
 Repudiation going to, 730 n, 764. 
 See Conditions. 
 
 . ESTOPPEL, 
 
 To set up actual intention contrary to overt expression, 112-141. 
 And consideration for a promise, 222-252. 
 Distinguished from waiver, 706. 
 To plead condition subsequent, 703. 
 By judgment in favor of one joint promisor, 1200 n. 
 See Waiver of Condition. 
 
 EVICTION OF TENANT, 
 
 Effect on duty to pay rent, 697. 
 
 EVIDENCE, 
 
 Illegal contract to procure, 1293 n. 
 EXCUSE, 
 
 Not same thing as performance, 840, 841 n. 
 
 For nonfulfillment of a condition, manner of pleading, 659, 703, 840. 
 See Indpossibllity ; Pleading; Repudiation; Waiver. ■ 
 EXECUTED CONSIDERATION, 
 
 See Past Consideration ; Unilateral Contract. 
 
INDEX 1491 
 
 [The figures refer to pages] 
 EXECUTOR, 
 
 Consideration for promise of an, 220, 260. 337 
 
 Promise of, within statute of frauds, 1374 
 EXECUTORY ACCORD, 
 
 See Accord Executory. 
 EXONERATION, 
 
 By parol, as a discharge, 948-957. 
 
 Form of plea, 956. 
 
 EXPRESS CONDITIONS, 
 
 Precedent, 478, 480-504, 628-647, 661-679 1059. 
 
 Subsequent. 702-721. 
 
 Of personal satisfaction, 675, 676 n. 
 
 In charter party, 692. 
 
 Precedent to a power to terminate a lease, 699 n. 
 
 Certificate of architect or engineer, 628-647, 670 
 
 Personal satisfaction, 661-679. 
 
 In inaurancp policy, 866, 870. 
 
 Award of arbitrators as, 1298, 1303. 
 
 Waiver of, 823-842. ' 
 
 EXPRESS TRUST, 
 
 Within statute of frauds, 1398. 
 EXTENSION OF TIME, 
 
 To a debtor as consideration, 262, 263, 266. 
 
 Consideration given by debtor for such extension, 340. 
 
 FAILURE OF CONSIDERATION, 
 Partial, 533-549, 722, 849. 
 
 See Conditions ; Installment Contracts. 
 FAMILY SETTLEMENT, 
 
 Enforcement of contract for, by the beneficiary, 1040, 1041, 1043, 1061, 
 1066. 
 
 FIDUCIARY, 
 
 Contracts in breach of trust, 1325, 1334-1.S48. 
 
 FINDER'S LIEN, 193. 
 
 FIRE, 
 
 Absence of as condition precedent, 488, 721. 
 Destruction of buildings, duty to pay rent, 701. 
 Destruction of subject-matter by, 888, 892, 902, 906, 913. 
 Express words of exception or condition, 488, 721, 920 n. 
 
 FIREMAN, 
 
 Performance of duty as a consideration, 386 n. 
 
 FIXTURES, 
 
 Sale of, to be severed, 1407 n. 
 
 FORBEARANCE, 
 
 As consideration, 252-292, 308, 332. 
 
 To smoke or drink, 252. 
 
 To make a request of a sick man, 254. 
 
 To accept an offer, 257. 
 
 To bring suit or to press a claim, 259-292. 
 
 To press an invalid claim, 268-292. 
 
 To go into bankruptcy, as a consideration, 338. 
 
 To rescind contract, as a consideration, 376. 
 
 To commit a tort, as a consideration, 386. 
 
 FOREIGN LAW, . 
 
 Change in, making performance impossible, 902 n. 
 
 FORFEIT, 
 
 Of deposit for not executing contract, 110. 
 
1492 INDEX 
 
 [The figures refer to pages] 
 
 FORMAL DOCUMENT, 
 
 As prerequisite to contract, 11, 14. 
 Parties bound in spite of mistake, 123 n. 
 
 FRACTION OF A DAT, 
 
 Disregard of, 1425. 
 FRAUD, 
 
 By impersonation, 130 n. 
 
 Of architect in refusing certificate, 628-647. 
 
 In withholding architect's certificate, 811. 
 
 Illegal contract to perpetrate, 1322. 
 
 In competitive bidding, 1348. 
 
 In auctions, 1353 n. 
 
 In compositions with creditors, 1353. 
 See Statute of Frauds. 
 
 FRAUDULENT REPRESENTATIONS, 
 Effect on -contract, 137. 
 
 FREIGHT, 
 
 Delivery at destination as condition precedent, 696 n. 
 FUNDAMENTAL LEGAL CONCEPTIONS, 794 n. 
 FUTURE DAMAGES, 
 
 For breach of contract, 664. 
 
 FUTURES, 
 
 Betting on future prices, 1265, 1270. 
 One party Innocent, 1371 n. 
 
 GAMING, 
 
 See Wagering Contracts. 
 
 GIFT, 
 
 Past service as a consideration, 399. 
 
 Discharge of negotiable instrument by, 945. 
 
 Discharge of unilateral obligation by, 952, 957. 
 
 Assignment of chose in action by, 1130-1139. 
 
 Causa mortis, 1132, 1135. 
 
 Delivery, what constitutes, 1132, 1135. 
 
 Of donor's check, 1138. 
 
 GOODS, WARES, AND MERCHANDISE, 
 Contracts for sale of, 1430-1442. 
 
 GOOD WILL, 
 
 Of a business, sale of, see Restraint of Trade. 
 
 GOVERNMENT CONTRACTS, 
 
 Agreements for aid in obtaining, 1325. 
 
 GRATUITOUS BAILMENT, 211, 228, 231. 
 
 GROWING TREES AND CROPS, 
 
 See Statute of Frauds. 
 
 GUARANTY, 
 
 Acceptance of offer of, 73. 
 
 Revocation of ofCer, 181, 184. 
 
 Consideration for, 207, 214, 262, 266, 367. 
 
 Implied conditions in, 686-691. 
 
 Guaranty Insurance, 690. , , 
 
 A pledge of property is not, 1392. 
 
 Must memorandum express the consideration, 1450. 
 
 Contracts within statute of frauds, 1375-1394. 
 
 Sole credit given to defendant, 1376. 
 
 Where the contract is joint, 1377 n. 
 
 A novation Is not guaranty, 1377, 1389. 
 
 Promise to a debtor is not within Statute of frauds, 1380. 
 
INDEX 1493 
 
 [The figures refer to pages] 
 GUAEANTT— Continued, 
 
 Cousideration of benefit to promisor, 1384, 1385, 1391 n 
 Leading object" of promisor, 1384, 1388. 
 
 Of payment of a note, by one who transfers it, 1389. 
 HOHFBLD'S ANALYSIS, 
 
 Of jural relations, 794 n. 
 HUSBAND, 
 
 Performance of duty by, as consideration, 382. 
 
 Agreement between wife and, 3. 
 IDENTITY OF PARTY, , 
 
 Mistalte as to, 129. 
 IGNORANCE, 
 
 Of illegality on part of plaintiff, 1370. 
 
 Of law is no excuse, 1371 n. 
 
 ILLEGAL, CONTRACTS, 1206-1373. 
 Restraint of trade, 1206-12.56. 
 Wagering contracts, 1257-1273. 
 Champerty and maintenance, 1273-1288. 
 Stifling a prosecution, 1289-1293. 
 Ousting courts of jurisdiction, 1294-1312. 
 Contracts affecting marriage, 1313-1319. 
 Sunday laws, 1320, 1321. 
 Inducing crime or private wrong, 1322-1356. 
 Lobbying, 1325, 1329. 
 Publishing libel, 1322. 
 Breach of trust, 1325, 1334r-1348. 
 Assignment of public salary, 1338. 
 Location of railway depot, 1339. 
 Fraud in bidding, 1348. 
 For service as a broker, 1265, 1270, 1344. 
 Providing for dummy directors, 1343 n. 
 To facilitate divorce, 1315 n. 
 For appointment of a public oflScer, 1328, 1334. 
 For location of public service building, 1339. 
 Sexual immorality, 1365, 1369 n. 
 To procure evidence, 1293 n. 
 Limiting remedy to a particular court, 1294. 
 
 With an agent or trustee to induce breach of trust, 1334, 1341, 1344. 
 Arbitration agreements, 1294-1312. ' 
 
 Rights of innocent plaintiff, 1370. 
 Knowledge of illegal purpose, 1363-1371. 
 Fraud in compositions with creditors, 1353. 
 Conducting business without a license, 1357. 
 In aid of an illegal purpose, 1363-1371. 
 Illegal in part, 1372. 
 Statute marks the criminal, 1371 n. 
 Performance made illegal by a subsequent statute, 809. 
 Performance made Illegal by outbreak of war, 927 n. 
 Parol evidence admissible to show illegality, 1276. 
 
 See Arbitration Agreement; Champerty; Marriage; Restraint of 
 Trade ; Stifling a Prosecution ; Sunday Laws ; Wagering Contracts. 
 
 ILLICIT COHABITATION, 
 Illegal contract for, 1369 n. 
 
 ILLNESS, 
 
 As excuse for nonperformance, 617. 
 
 ILLUSORY PROMISE, 
 
 As consideration, 266, 298, 300, 315. 
 
 Promise on condition of personal satisfaction, 675^ 
 
 Reserved power to cancel, 718 n. 
 
1494 INDEX 
 
 [The figures refer to pages] 
 
 IMMORAL CONSIDERATION, 449. 
 
 IMMORALITY, 
 
 Contracts in aid of, 1365, 1369 n. 
 
 IMPERSONATION OF ANOTHER. 
 To defraud, 130 n. 
 
 IMPLIED ACCEPTANCE, 83-93. 
 
 IMPLIED CONDITIONS, 
 
 Precedent, 478, 504r-702, 722. 
 See Conditions. 
 IMPLIED CONTRACT, 134. * 
 
 IMPLIED COVENANT, -508. 
 
 IMPLIED PROMISE, 
 
 Contract bilateral by implication, 189-205, 309. 
 Not to liinder performance by other party, ,817. 
 Not to make fulfillment of condition impossible, 818. 
 To stifle a prosecution, 1293 n. 
 
 IMPLIED RESCISSION, 
 Of service contract, 354. 
 
 IMPOSSIBILITY, 842-927. 
 
 Absence of title in vendor, 844. 
 Insolvency of buyer, 847. 
 Effect of partial impossibility, 849. 
 Belief in the inability of the other party, 857 n. 
 • Defect in title of vendor, 859, 860. 
 Prospective, of performance by plaintiff, 842-857. 
 Prospective, of performance by defendant, 858-862. 
 Of performance by defendant as a discharge of his duty, 877-927. 
 Caused by act of government, 927 n. 
 Destruction of subject-matter, 888, 892, 897-918. 
 Death of party, 877, 879. 
 Crop failure, 897. 
 
 Caused by a subsequent statute, 899. 
 Destruction of means of performance, 924 n. 
 Quasi contractual remedies, 866, 899, 906. 
 
 Contracts warranting or insuring a certain result, 910, 911, 913. 
 Distinguished from mere difiiculty or expense, 910-927. 
 Economic unprofitableness, 921, 928 n. 
 
 Of performance by defendant until some action by plaintiff, 507, 722. 
 Voluntarily caused, operates as a repudiation, 731, 733, 758, 858. 
 Caused by arrest for crime, 863. 
 
 Of fulfillment of cSndition precedent, 866, 870, 874,, 875. 
 Of fulfillment of condition, caused by defendant, 808-822, 874, 875. 
 Of fulfillment of condition subsequent, 7l7 ; and see 703 n. 
 
 INABILITY, 
 
 Expression of, is not repudiation, 764. 
 
 INCHOATE RIGHT, 
 
 Anticipatory repudiation as a breach of, 756, 762. 
 
 INCOMPLETE DOCUMENT, 
 Effect of delivery, 465 n. 
 
 INCREASE OF SALARY, 
 
 Consideration for, 343, 344, 354. 
 
 INCUMBRANCE, 
 
 On title of vendor, 859, 860. 
 
 INDEMNITY, 
 
 For publishing libel, contract for, 1322. 
 
 Contract of, when not within' statute of frauds, 1380, 1383 n. 
 
INDEX 1495 
 
 [Tha figures refer to pages] 
 INDENTURE, 455. 
 
 Of apprenticeship, 539. 
 
 INDEPENDENT PROMISES, 479, 504, 508, 510 n, 522-533, 555. 
 
 Rules of Serjt. Williams, 510 n. 
 
 Rules of Lord Mansfield, 513, 851. 
 
 Divisible contract, 564. 
 
 In aleatory contracts, 685-691, 739. 
 
 In leasing contracts, 696-702. 
 See Conditions. 
 INFANT, 
 
 Promise of as consideration, 293. 
 
 Ratification of contract, 393, 405-413. 
 
 New prfftaise as cause of action, 408 n, 409, 410. 
 INFORMATION, 
 
 Rewards for, 17-26, 178. 
 
 INOPERATIVE PRELIMINARY Negotiation, 1-17. 
 INQUIRy, 
 
 Not a counter offer, 102. 
 INSANITY, 
 
 As revocation of offer, 170. 
 
 As excuse for nonfulfillment of condition of notice, 870. 
 INSOLVENCY, 
 
 Of surety company, effect on duty to pay premiums, 690. 
 
 Of buyer, effect on duty of seller, 847. 
 
 INSTALLMENT CONTRACTS, 550-605. 
 Sales of land, 521, 522, 551-559, 736. 
 For school scholarship, 529. 
 Sales of goods, 560-6*5. 
 
 Payment of price as a condition, 560, 567, 568, 587. 
 Delivery of goods as a condition, 562-566, 572-586. 
 Effect of destruction of subject-matter, 902. 
 
 INSURANCE, 
 
 Acceptance of offer for, 28, 68, 80. 
 
 Delivery of policy, 465. 
 
 Conditions precedent, 484., 489, 496, 500, 645, 690 n, 739. 
 
 Notice, as a condition precedent, 681 n, 684. 
 
 Guaranty insurance, 690. 
 
 Condition subsequent, 702, 703, 707. 
 
 Burden of pleading and proof, 709. 
 
 Interest of beneficiary, 709. 
 
 Repudiation by insurance company as a breach, 768, 771. 
 
 Non-payment of premiums caused by war, 866. 
 
 Notice, as a condition precedent, 870. 
 
 Rights of mortgagee beneficiary, 1055 n. 
 
 Rights of beneficiary of life policy, 1066 n, 1108. 
 
 Mutual agreement to insure for benefit of children, 1069. 
 
 Power to change beneficiary, 1070, 1105 n. 
 
 Reinsurance, 1108. 
 
 Assignment of tights by insured, 1149. 
 
 As a lawful wager, 1259 n. ....,„„. 
 
 Illegal provision limiting suits to one jurisdiction, 1294. 
 
 Award of arbitrators as to amount of loss as a condition precedent, 1303. 
 
 INTENTION, 
 
 False representation as to, 137. 
 To affect legal relations, 1-17; 
 
 INTENTIONAL BREACH, 
 
 By building contractor, 647, 654, 656, 660 n. 
 
1496 INDEX 
 
 [The figures refer to pages] 
 
 INTEBPRETATION, 478. 
 Of statutes, 1420. 
 Contra proferentem, 124 n. 
 
 INVITATION TO TRADE, 
 As an offer, 4, 5. 
 
 IRON SAFE CLAUSE, 484. 
 
 IRREVOCABLE OFFERS, 189-205, 613. 
 Assignment by offeree, 1178, 1182 n. 
 
 .TEST. 
 
 Offer made in, 1. 
 
 JOINT CONTRACTS, 1186-1205. 
 
 Joint promisors, 1186-1200. " 
 
 Joint promisees, 1201-1205. 
 
 Death of one promisor, 1193. 
 
 Death of one promisee, 1201. 
 
 Release of one promisor, 1194. 
 
 Release of one promisee, 1202. 
 
 Covenant not to sue one promisor, 1196. 
 
 Judgment against one promisor, 1199. 
 
 In case of partners, 1199, 1203. 
 
 Construed as several when interests are several, 1204. 
 
 Obligees cannot be joint and several. 1206 n. 
 
 Operation of statute of frauds, 1377 n. 
 
 JOINT TORT-FEASOR, 
 Release of one, 1199 n. 
 No right of indemnity, 1322. 
 
 JUDGMENT, 
 
 Revival of by a new promise, 418. « 
 
 Part payment is not satisfaction, 1005. 
 
 Against one joint debtor, as bar to action against others, 1199. 
 
 JURAL RELATIONS, 
 
 Hohfeld's classification, 794 n. 
 
 JURISDICTION, 
 
 Agreements ousting courts of, 1294-1312. 
 
 JURY, 
 
 Agreement a question for, 83, 88 n, 114. 
 
 KNOWLEDGE, 
 
 Of illegal purpose, contract made with, 1363-1371. 
 
 Of offer, necessity of, 17-27. 
 
 Of revocation of offer, 165-180. 
 
 LABOR UNION, 
 
 Contract in restraint of trade, 1240. 
 
 LABORER, ' 
 
 Rights of, on builders' bonds, 1095-1103, 1107 n. 
 
 LAND CONTRACTS, 
 See Sale of Land. 
 
 LAPSE OF OFFER, 141-205. 
 
 LAW MERCHANT, 
 
 Bills of exchange assignable by, 1114. 
 
 LEASING CONTRACTS, 
 
 Implied conditions in, 534, 696-702, 863. 
 Notice of disrepair as condition precedent, 681 n, 682. 
 License to sell liquors as a condition, 700. 
 Repudiation in part, 764. 
 
INDEX ■ 1497 
 
 [The figures refer to pages] 
 
 LEASING CONTRACTS— Continued, 
 
 Expulsion of tenant by public enemy, 878. 
 Mining, effect of exhaustion of ore body, 883. 
 
 LETTER OF CREDIT, 181, 184. 
 
 LETTERS, 
 
 To agent as memorandum within statute of frauds, 1458, 1461 n. 
 
 Admitting contract and then repudiating it, 1458 n. 
 LIBEL, 
 
 Agreement to publish, 1322. 
 LIBERAL REWARD, 178. 
 
 LIBERTY OF CONTRACT, 
 
 The paramount public policy, 1211, 1212 n. 
 LICENSE, 
 
 To sell liquors, as condition of a lease, 700. 
 
 Conducting business without, 1357-1362. 
 
 Plaintiff ignorant that defendant was without, 1370. 
 
 LIMITATION, 
 
 On right of action, 702, 703, 713. 
 See Statute of Limitations. 
 
 LIQUIDATED DAMAGES, 110, 609, 722, 1247, 1255. 
 
 Not collectible by one who himself prevents performance, 807, 813. 
 
 Effect of waiver, 831. 
 
 No bar to specific enforcement, 1214 n. 
 
 LIQUIDATED DEBT, 
 
 Payment of a less sum no satisfaction, 320, 900. 
 
 XIQUORS, 
 
 Illegal sale without a license, 1357. 
 
 Sale with knowledge of buyer's illegal purpose, 1364. 
 
 Illegal selling as part of clerk's duty, 1|72. 
 
 LOANING MONET, 
 
 License to conduct business, 1359. 
 
 LOBBYING CONTRACTS, 1329. 
 
 LOST ARTICLE, 
 
 Reward for, 193. 
 LOST MEMORANDUM, 
 
 Still satisfies statute of frauds, 1458 n. 
 LOVE AND AFFECTION, 
 
 As consideration, 216, 387. 
 
 A^eptance by, 27-51, 145-162, 170. 
 Notice of abandonment by, 77. 
 Rejection of offer by, 95 n. 
 Revocation of offer by, 46,. 102, 168, 170. 
 
 MARGIN, . 
 
 Sales of commodities or stock on, 1265, 12,70. 
 
 MAINTENANCE, 1273-1288. 
 
 As affecting assignment of rights, 1111 n. 
 
 MARRIAGE, 
 
 As consideration, 362, 376, 382. 
 
 Illegal contracts affecting, 1313-1319. 
 
 Contract to renew marital relations, 1315. 
 
 Illegal contract to marry after obtaining divorce, 1369n- 
 
 Contracts in consideration of, statute of frauds 1394-1397. 
 
 Mutual promises of, not within statute of frauds, 1396 n. 
 
1498 INDEX 
 
 [The figures refer to pages] 
 
 MAERIAGE — Continued, 
 
 Contract of, not to be performed in. one year, 1396 n. 
 Promise to be performed at time of, 1414. 
 
 MARRIAGE BROKAGE CONTRACTS, 
 Are illegal, 1315 n. 
 
 MARRIAGE SETTLEMENT, 
 
 Enforcement of contract for, by the beneficiary, 376, 1040, 1041, 1043, 
 1071. 
 
 MARRIED WOMAN, 
 
 Ratification of her contract, 413. 
 
 MASTER AND SERVANT, 
 See Service Contract. 
 
 MEETING OF THE MINDS, 87, 112-141, 14R, 170. 
 See Mistake ; Offer and Acceptance. 
 
 MEMORANDUM, 
 
 Required by statute of frauds, 1443-1463. 
 MENTAL ASSENT, 
 
 Not sufficient as acceptance of offer, 60-80, 152. 
 
 Not triable, 60. 
 
 MERGER, 
 
 Discharge by, 1037-1039. ';. 
 
 By an award of arbitrators, 1032 n. 
 
 By judgment, 1199. 
 
 MISREPRESENTATION, 
 Burden of proof, 707. 
 
 MISTAKE, 112-141. 
 
 In code telegrams, 118 n. 
 In transmitting telegram, 118. 
 Cancellation as remedy, 121f 
 Unilateral mistake in bids, 121-128. 
 As to identity of party to contract, 129. 
 Mistake by one known to the other, 127. 
 Of architect in refusing certificate, 628-047. 
 As to existence of subject-matter, 883. 
 Alteration by, 1028. 
 
 MITIGATION OF DAMAGES, 
 
 After repudiation, 251, 529, 786. 
 
 By servant wrongfully discharged, 664, 742, 794, 804, 
 
 "Duty" to mitigate, 794 n, 798, 804. 
 
 MONET HAD AND RECEIVED, 
 See Quasi Contract. 
 
 MONEY LENDER, 
 
 License required, 1359. 
 
 MONOPOLY, 
 
 See Restraint of Trade. 
 
 MORAL OBLIGATION, 
 
 Agreement creating nothing more, 711. , 
 
 As consideration, 393-454. 
 See Past Consideration. 
 
 MORTGAGE, 
 
 Existence of, is not Impossibility, 860. 
 
 MORTGAGEE, 
 
 Rights as beneficiary against grantee who assumes debt, 1055, 1075-1091. 
 
INDEX 1499 
 
 [The figures refer to pages] 
 
 MOTIVE, 
 
 Compared with consideration, 222, 226, 248 379 
 Of acceptance, 17. ... 
 
 MUTUAL ASSENT, 87, 112-141, 145, 170 
 
 See Mistake ; Offer and Acceptance. 
 MUTUAL PROMISES, 
 
 As consideration, 292-319. 
 
 Promise to perform as required by legal duty, 332. 
 MUTUALITY OP OBLIGATION, 52-60, 236. 
 
 Exists though one promise is conditional, 838 
 
 See Bilateral Contract; Illusory Promise; Unilateral Contract. 
 NEGLIGENCE, 
 
 Contract exempting common carrier, 1341 n. 
 NEGOTIABLE INSTRUMENT, 
 
 Operates to suspend right of action, 942, 982. 
 
 Surrender of, as a discharge, 943. 
 
 Accepted as satisfaction, 990 n. 
 
 Alteration of, 1028. 
 
 NEGOTIABLE NOTE, 
 
 Of infant, ratiflcatlon of, 410. 
 
 Barred by statute, ratification of, 415. 
 NEW YORK ARBITRATION LAW, 1313 n. 
 NEWSPAPER SUBSCRIPTION, 
 
 Acceptance by using, 85. 
 NOTICE, 
 
 Of acceptance of offer, 60-80, 145, 155. 
 
 Where acceptance is by act, 52-60, 145. 
 
 By holder of an option, 77, 203. 
 
 Of revocation of offer, 160-180. 
 
 Of acceptance of guaranty bond, 469. 
 
 Of abandonment of contract, 77. 
 
 Of default, waiver of, 432. 
 
 As a condition precedent, 73, 203, 680-685, 1095. 
 
 Of claim that delay in performance was caused by plaintiff, 807 n, 831. 
 
 To re-establish a condition after its extinguishment by waiver, 833, 837 n. 
 
 Of breach of warranty, as a condition subsequent, 713. 
 
 Of exercise of power to cancel contract, 718 n. 
 
 Of accident, as condition in insurance, 870. 
 
 NOVATION, 
 
 Discharge by, 959-979. 
 
 Distinguished from assignment, 962 n, 963, 1159. 
 
 Third party beneficiary's rights not based on, 1089, 1108, 1110 n. 
 
 Not a guaranty within the statute of frauds, 1377. 
 
 NUDUM PACTUM, 165, 175, 206, 224, 265, 472. 
 See Consideration. 
 
 OFFER, 
 
 In jest, 1. 
 
 Invitation to trade, 4, 5. 
 
 Bids, 9. 
 
 Quotation of prices, 5. 
 
 Trade circulars, 4. 
 
 Communication of, 17, 155. 
 
 By publication, 64, 178. 
 
 Of subscription for shares, 31, 64 n. 
 
 Of reward, 17-27, 64, 178, 193. 
 
 Of an act for a promise, 83-92, 145. 
 
 Of promise for an act, 52^6, 181, 184, 189-205. 
 
1500 INDEX 
 
 [The figures refer to pages] 
 
 OFFER— Continued, 
 
 Of promise for forbearance, 252-292. 
 
 Of promise of guaranty, 73, 181, 184. 
 
 Of an accord and satisfaction, unaccepted, 995. 
 
 Lapse or revocation, 141-205. 
 
 Revocation by death or insanity, 170, 177, 244. 
 
 Creating a povsrer to accept more than once, 181, 184, 185, 298. 
 
 Under seal, 200. 
 
 Irrevocable offers, 189-205. 
 
 Made on Sunday, 1321 n. . 
 
 Assignment of offeree's power, 1182 n. 
 
 In writing, accepted orally, satisfies statute of frauds, 1444. 
 
 Letter of authority to agent- is not an, 1458. 
 
 OFFER AND ACCEPTANCE, 1-205. 
 
 OFFERS, 
 
 Crossing in the mail, 155. 
 OFFICE, 
 
 Public, agreements for appointment to, 1328, 1334. 
 
 Assignment of salary illegal, 1338. 
 
 OFFICIAL DUTY, 
 
 Performance of, as consideration, 19, 381-387. 
 
 ONE XEAR, 
 
 Clause in statute of frauds, 1414^1429. 
 OPERATION OF CONTRACT, 478-927. 
 
 Of an oral contract within the statute of frauds, 1462, 1464-1476. 
 
 OPTIONS, 
 
 Revocable, 166, 174, 203 n, 298, 300. 
 
 Irrevocable options, 189-205, 305, 613. 
 
 Under seal, 200. 
 
 In a lease, 203 n, 314 n. 
 
 Notice of abandonment of contract, 77. 
 
 Consideration in option conti'acts, 298-319. 
 
 Time of the essence, 203, 610, 613. 
 
 Conditions in, 492, 493, 610, 613, 717, 719. 
 
 Personal satisfaction as a condition, 673 n. 
 
 To buy land, effect of conveyance to third person, 855. 
 
 To purchase, assignment of, 1178. 
 
 OPTION TO CANCEL, 
 
 Reserved in contract, 718 n. 
 See Cancellation. 
 
 ORAL CONTRACT, 
 
 Ratification of, 429. 
 
 See Statute of Frauds. 
 OUSTING JURISDICTION, 
 
 Illegal arbitration agreements, 1294-1312. 
 
 Suits limited to a special jurisdiction, 1294. 
 
 OVERT ACTS, 
 
 Acceptance by, 52-80. 
 
 Intention determined from, 112-141. 
 
 PAROL CONDITION PRECEDENT, 
 To operation of a document, 1190. 
 
 PAROL EVIDENCE, 
 
 Admissible to prove illegality, 1276. 
 
 In explanation of memorandum required by statute of frauds,. 1443-1463.. 
 PAROL EXONERATION, 
 
 As a discharge, 948-957. •. 
 
INDEX 1501 
 
 [The figures refer to pages] 
 
 PAROL RESCISSION, 
 
 Of a specialty, 1023. 
 
 Of written contract within statute of frauds, 1467, 1468 n. 
 PART PATMENT, 
 
 As consideration, 320, 328. 
 
 As satisfaction, 320, 990-1013. 
 
 By a tliird person, as a discharge, 1016. 
 
 As waiver of bar of statute, 423. 
 
 As revival of debt discharged in bankruptcy, 439. 
 
 To satisfy statute of frauds,, 1440. 
 PART PERFORMANCE, 
 
 Making offer irrevocable, 189-205. 
 
 Acceptance of, as waiver of condition, 823. 
 
 PARTIAL ASSIGNMENT, 1154, 1155, 'llT3. 
 See Assignment. , 
 
 PARTIAL FAILURE, 
 
 Of performance, 533-549, 722, 849. 
 See Installment Contracts. 
 
 PARTIAL ILLEGALITY, 1217 n, 1372. 
 
 PARTITION OF LAND, 
 By parol, 1413, 1414 n. 
 
 PARTNERSHIP, 
 
 Liability of new partner to old creditors, 1055 n. 
 
 Dormant partner discharged by judgment against others, 1199. 
 
 Joint relations of partners, 1199, 1203. 
 
 To buy and sell land, 1408, 1409. 
 
 To buy and sell goods, 1437 n. 
 
 PARTY WALL, 
 
 Acceptance by use of, 83. 
 
 PAST CONSIDERATION, 387-^54. 
 
 Given at the request of the promisor, 389-450. 
 
 Promise of additional compensation, 404. 
 
 Revival of debts barred by statute, 41.5-425. 
 
 Ratification of infant's contract, 393, 405-413. 
 
 Ratification of usurious obligation, 425. 
 
 Ratification of Sunday contract, 428. 
 
 Ratification of contract within statute of frauds, 429. 
 
 Waiver of demand and notice, 432. 
 
 Revival after discharge in bankruptcy, 435-4^43. 
 
 Revival of duty after a voluntary release or satisfaction, 444r^45i 
 
 Of immoral character, 449. 
 
 PATENT RIGHT, 
 
 Assignment of, conditions concurrent, 849. 
 
 PAWNBROKER, 
 
 Requirement of license, 1359. 
 
 PAYMENT 
 
 Of price as a condition, 560, 563, 567, 568, 587. 
 
 In option contracts, 610, 613. 
 
 Progress payments, failure to make, 589, 593. 
 
 Of rent, as condition of landlord's duties, 696. 
 
 Of insurance premiums, efEect of failure to make, 690 n, 739. 
 
 Ability of buyer to make, as a condition, 842, 847. 
 
 Of price to satisfy statute of frauds, 1440. 
 
 As a discharge, 957. > 
 
 By a third person, 1013, 1016. 
 
 Conditional, 1016 n. . ^ ^ ^ 
 
 See Accord and Satisfaction; Part Payment. 
 
1502 INDEX 
 
 [The figures refer to pages] 
 
 PEPPERCORN, 
 
 As consideration, 218. 
 
 PENALTY. 
 
 Distinguished from liquidated damages, 110, 1815. 
 
 Makes contract illegal even if no express prohibition, 1357. 
 
 For purpose of revenue only, 1358 n, 1359. 
 PENSIONS, 
 
 Not assignable, 1339 n. 
 
 PERFORMANCE, 
 
 Of pre-existing duty as consideration, 320-387, 1009. 
 Promise of such performance, 332, 374, 377, 1005. 
 On time, as a condition, 606-617, 575. 
 On time, in service contract, 617, 621. 
 
 Of conditions, pleading and burden of proof, 707, 712-728. 
 General averment of performance by plaintiff, 707, 721 n, 722, 728 n. 
 Prevention of, 807-822. 
 
 Delay, caused by other party, 813, 831, 1467. 
 Not to be within one year, 1414^1429. 
 Of contract within statute of frauds, effect of, 1464. 
 See Conditions; Substantial Performance. 
 
 PERSONAL PERFORMANCE, 
 
 Contract requiring, effect of death, 879. 
 As a condition precedent, 1158-1182. 
 
 PERSONAL SATISFACTION, 
 As a condition, 636, 661-679. 
 
 PLACE, 
 
 Where contract is deemed made, 42 n. 
 
 PLEADING, 
 
 Infancy, ratification, 406. 
 
 Statute of limitations, waiver, 415. 
 
 New promise after discharge in bankruptcy, 439. 
 
 Substantial performance by plaintiff, 659. 
 
 Consideration for a written contract, 474. 
 
 Fulfillment of condition precedent, 707, 709, 712, 721, 722. 
 
 General averment of performance by plaintiff, 707, 721 n, 722, 728 n. 
 
 Condition subsequent, 713. 
 
 Waiver of condition subsequent, 703. 
 
 Excuse for nonfulfillment of conditions, 703. 
 
 Departure in, 704. 
 
 Waiver of conditions, 840. 
 
 Substantial i>erformance, 841 n. 
 
 The statute of frauds, 1476 n. 
 
 PLEDGE, 
 
 Of goods as security not within statute of frauds, 1392. 
 
 POLICE, 
 
 Performance of duty as consideration, 381, 384. 
 
 POLL DEED, 455, 465. 
 
 POOLING AGREEMENTS, 
 
 In illegal restraint of trade, 1239 n. ' 
 
 PORTRAIT CONTRACT, 
 
 Personal satisfaction as a condition, 661. 
 
 POSSIBILITY, 
 
 Of full performance within one year, 1414-1429, 
 
 As a condition, 842. 
 See Impoissibility. 
 POST, 
 
 See Mail. 
 
INDEX 1503 
 
 [The figures refer to pages] 
 
 POST OFFICE, 
 
 As agent, 31, 46. 
 
 POTESTATIVE CONDITION, 480. 
 
 POWER, 
 
 Of acceptance, duration of, 56, 141-205. 
 
 Effect of a late acceptance, 93 n. 
 
 Examples of a conditional, 699 n, 717, 719. 
 
 Of attorney, to an assignee, 1111, 1112. 
 
 Of revocation of offer, 141-205. 
 
 To retract repudiation. 742, 782, 804. 
 
 Of terminating contract, expressly reserved, 42 n, 314 n, 718 n, S57 n, 1420. 
 
 Surrender of, as consideration, 258 n. 
 
 PRECEDENT, 
 
 The force of, 1015. 
 
 See Conditions Precedent. 
 
 PRELIMINARY NEGOTIATION, 1-17. 
 
 PRESUMPTION, 
 
 Of consideration for sealed or written contracts, 222 n, 471-477, 928, 930. 
 Of survival in case of death in common disaster, 709. 
 
 PREVENTION OF PERFORMANCE, «)7-K2, 1467. 
 
 As a tort, 807, 820 n. 
 
 In service contracts, 820. 
 PRICE, 
 
 Action for, distinguished from action for damages, 522. 
 
 Payment of, as a condition, 560, 563, 567, 568, 587. 
 
 Statement of, not an offer, 5. 
 
 PRIMARY OBLIGATION, 479. 
 
 PRIVILEGE, ^ 
 
 Surrender of, as consideration, 260 n. 
 
 Not to perform, created by a repudiation, even if no right to dam- 
 ages, 762. 
 Of naming child as a consideration, 1073. 
 
 PRIVITY OP CONTRACT, 
 
 See Third Party Beneficiaries. 
 
 PROGRESS PAYMENTS, 
 
 Effect of failure to make, 589, 593. 
 Assignment of, 1171. 
 
 See Building Contracts. 
 
 PROMISE, . „„„ „„, ___ 
 
 For benefit of third person, rights of promisee, 768, 771, 775 n. 
 To suspend right of action, 936-944. 
 Of a release by way of gift, 951. 
 
 See Bilateral Contract; Consideration. 
 
 PROMISSORY NOTE, 
 
 Repudiation of, 7o7, 764 n, 770. 
 
 Promise to grant extension or renewal, 943, 984 n. 
 
 Surrender of, as a discharge, 945. 
 
 Operates to suspend right of action, 942, 982. 
 
 Accepted as satisfaction, 990 n. 
 
 Alteration of, 1028. ^ ^ ^ ^ __ 
 
 Assignable by Stat. 3 & 4 Anne, 1114. 
 
 Oral contract for sale of, 14d5. 
 
 PROSPECTIVE DAMAGES, 
 
 'See Damages; Repudiation. 
 PROSPECTIVE IMPOSSIBILITY, 842. 
 See Impossibility. 
 
1504 INDEX 
 
 [The figures refer to pages] 
 
 PROSTITUTION, 
 
 Contracts to aid of, 1365, 1369 n. 
 
 PUBLIC CONTRACTS, 
 
 For benefit of third persons, 1058 n, 10G3. 
 
 PUBLIC OFFICE, 
 
 Agreements for appointment to, 1328, 1334. 
 Assignment of salary illegal, 1338. 
 
 PUBLIC POLICY, I 
 
 As basis for declaring a contract illegal, 1211, 1212 n. 
 
 PUBLICATION, 
 
 Offer by, 64, 178, 193. 
 
 PUFFING, 
 
 At auctions, 1353 n. 
 
 PURCHASE PRICE, 
 
 Of goods, no debt exists until title has passed, 788, 793 n. 
 See Installment Contracts. 
 
 QUANTUM MERUIT, 
 
 By servant wrongfully discharged, 794. 
 
 Where plaintiff is in default on a building contract, 647. 
 
 'quasi contract, 
 
 As an implied contract, 134. 
 
 Quantum meruit by a contractor in default, 647. "^ 
 Buyer's right to money back on default by seller, 736. >/ 
 Buyer's right to money back where vendor's title fails, 859, 860. 
 Right to cash surrender value of insurance policy, 866. 
 Where performance has become impossible, 866, 899, 906. 
 For reasonable value when defendant has prevented a condition,. 819 a. 
 Right of assignee against assignor who has received payment, 1116. 
 Right of prior assignee as against subsequent assignee, 1153. 
 Recovery in case of illegal contract, by an innocent party, 1371 n. 
 Recovery where contract was illegal in part, 1372. 
 Recovery from a stakeholder, 1259. 
 
 In case of part performance of contract within statute of frauds, 1466 n. y 
 QUID PRO QUO, 206-222, 269. 
 
 QUOTATION OF PRICES, 
 Not an offer, 5. 
 
 RAILWAY STATION, 
 
 Agreement fixing location, 1339. 
 
 RATIFICATION, 
 
 Of married woman's contract, 268. 
 Of infant's contract, 393, 405-413. 
 Conditional ratification, 410, 423. 
 Of Sunday contract, 428. 
 Of usurious contract, 425. 
 See Past Consideration. 
 
 REAL ESTATE BROKER, 
 
 Right to commission, when sale falls through, 808, 810. 
 Owner's power of revocation, 194r-202. 
 
 REAL PARTY IN INTEREST, 
 
 Third party beneficiary as, 1081. 
 
 After assignment, is the assignee, 1120 n. 
 
 REASONABLE TIME, 
 
 Offer' lapses after, 141-162. 
 Forbearance for, as consideration, 259. 
 
 RECEIPT IN FULL, 
 
 Bischarge by, 950 n, 952. 
 
INDEX 1505 
 
 [The figures refer to pages] 
 RECOGNIZANCES, 457 n. 
 RECOUPMENT, 
 
 By the debtor as against an assignee, 1139. 
 REFUSAL, 
 
 See Options. 
 
 REJECTION OF OFFER, 94-112, 155. 
 RELEASE, 
 
 Revival of duty of new promise after a, 444-448. 
 
 under seal, as a discharge, 928-944, 953, 1005, 1022. 
 
 On condition, precedent or subsequent, 930, 933, 987 n. 
 
 Power of as against a third i>arty beneficiary, 1078, 1085, 1103, 1105. . 
 
 Of one joint promisor, 1194. 
 
 On condition, as a covenant not to sue, 1196. 
 
 Of a joint tort-feasor, 1199 n. 
 
 By one joint promisee, 12(K. 
 RELIANCE, 
 
 On a promise as consideration, 222-252, 3^, 376. 
 
 Equitable relief, 235 n. 
 RENEWAL, 
 
 Of promissory note, 943, 984 n. 
 
 Of original right on breach of a composition agreement, 987, 987 n. 
 RENT, 
 
 Payment of, as a condition, 696, 699 n. 
 
 REPRESENTATION OF FACT, 
 
 As a condition, in a charter party, 693. 
 Truth of, as a condition, 483 n, 707. 
 
 REPUDIATION, 
 
 Of contract duty, 729-806. 
 
 Effect on other party's duty, 729-741, 747. 
 
 Going to the essence, 730 n, 764. 
 
 In case of independent promises, 739, 764. 
 
 Distinguished from rescission, 773. 
 
 When statute of limitations begins to run, 777. 
 
 Retraction of, 742, 782, 804. 
 
 Measure of damages and duty to mitigate, 784-806. 
 
 Before time of performance, as a cause of action, 742-806. 
 
 Expression of inability is not, 764, 783. 
 
 Election to treat it as a final breach, 767, 777, 788, 798. 
 
 As a waiver of conditions precedent, 731-741, 747, 757, 762, 844, 858, 
 
 Conditional in character, not a breach, 750. 
 
 Of commercial paper, 757, 764 n, 770. 
 
 By insurance company, 768, 771. 
 
 Mitigation of damages after, 251, 529, 664, 786-806. 
 
 Ability of other party may still be a condition precedent, 844. 
 
 By making performance impossible, 731, 733, 758, 858. 
 
 Assignment of contract is not, 1158, 1171 n, 1178. 
 
 REQUEST, 
 
 Past consideration at request of the promisor, 389-450. 
 For bids is not an offer, 4, 5, 9. 
 
 REQUIREMENTS, . 
 
 Contract for total need or requirement, 303, 601. 
 
 RESCISSION, 
 
 For fraud, 13?. 
 
 Of service contract, re-employment at higher salary, 354. 
 
 Power of, created by repudiation, 773. 
 
 Power of, expressly reserved, 42 n, 314 n, 719 n, 957 n, 1420. 
 
 By parol, as a discharge, 948-957. 
 
 OOKBIN CONT 95 
 
1506 INDEX 
 
 [The figures refer to pages] 
 
 RESCISSION— Continued, 
 
 Of specialty, by parol, 1023. 
 
 Of written contract, within statute of frauds, by parol, 1467, 1468 n. 
 
 By parties to contract as against a beneficiary, 1078, 1085, 1103, 1105, 
 
 RESOI/UTORT CONDITION, 480. 
 
 RESTITUTION, 
 
 Right of, as against a defendant in default, 736, 739 n. 
 See Quasi Contract. 
 
 RESTRAINT OF MARRIAGE, 
 
 Illegal contract in, 1313, 1315 n. 
 RESTRAINT OP PRINCES, 
 
 As excuse for nonperformance, SZ4, 927 n.' 
 RESTRAINT OF TRADE, 
 
 Contracts in illegal, 1206-1256. 
 
 jLiimited restraint distinguished from general, 1206, 1208, 1222. 
 
 Void only if unreasonable, 1215-1236. 
 
 Contract divisible, 1217 n. 
 
 In patented articles, 1217. 
 
 In excess of that necessary to protect good will, 1217. 
 
 By division of territory, 1236. 
 
 Pooling agreements, 1239 n. 
 
 Sherman Anti-Trust Law, 1289 n. 
 
 Combination of laborers, 1240. 
 
 In articles made by secret process, 1247, 1255. 
 
 Agreement, by a teacher, 1215. 
 By a clothing clerk, 1251. 
 By professional men, 1254 n. 
 
 Contract fixing retail prices, 1255. 
 
 When contract is within statute of frauds, 1417. 
 
 RESTRAINT ON ALIENATION. 
 
 Of choses in action, 1160, 1171, 1173. 
 
 RESULTING TRUST, 
 
 Not within statute of frauds, 1399. 
 
 RETRACTION, 
 
 Of a repudiation, 742, 782, 804. 
 
 REVENUE, 
 
 License required merely to collect, 1357, 1359. 
 
 REVENUE LAWS, 
 • Contracts in breach of, 1363. 
 
 REVOCATION, 
 
 Of submission to arbitration, 1031, 1034. 
 
 REVOCATION OF OFFER, 58, 141-205. 
 By mail or telegraph, 46, 102) 168, 170. 
 Necessity of communication, 163-180. 
 By death or insanity, 170, 177, 244. 
 Under French law, 72 n. 
 By sale of property to another, 174, 
 Irrevocable offers, 182-205. 
 
 REWARD, 
 
 Offers of, 17-27, 64, 178, 193. 
 
 Apportionment of, 23. 
 
 Lapse of offer, 145 n. 
 
 Revocation by publication, 178. 
 
 Performance of duty by an officer as consideration, 38i, 384. 
 RIGHT, 
 
 Surrender of, as consideration, 260 n. 
 
INDEX 1507 
 
 [The figures refer to pages] 
 RISK OF LOSS, 
 By Are, 892. 
 
 SALARY, 
 
 Of public officer, agreements to assign or to increase, 1338, 1839 n. 
 SALE OF GOODS, 
 
 Conditions in contract for, 507-517, 536, 537, 544, 560 564r-e06 
 
 Witli privilege of return, 673 n, 717, 718 n. 
 
 Effect of repudiation on seller's right to price, 788, 793 n 
 
 Measure of damages, 798. 
 
 With knowledge of buyer's illegal purpose, 1364, 1365. 
 
 When within statute of frauds, 1430-1442. 
 
 Work and labor distinguished, 1430, 1433. 
 
 Acceptance, to satisfy statute of frauds, 1375 n. 
 
 Acceptance, to pass title, 1433. 
 
 Choses in action are within the statute of frauds, 1435. 
 
 Uniform Sales Act, 1375 n, 1435 n, 1437 n. 
 
 To be manufactured, 1375 n, 1430, 1433. 
 
 Partnership to buy and sell, 1437 n. 
 
 What constitutes acceptance and receipt, 1375 n, 1438. 
 
 What constitutes part payment, 1440. 
 
 Description required by statute of frauds, 1443. 
 SALE OF LAND, 
 
 Conditions in contract for, 508, 518-528, 538, 551, 555, 558, 609, 610, 613, 
 731, 733, 736, 776, 782, 838, 844, 859, 860. 
 
 Sale by vendor to another person operates as repudiation, 731, 733. 
 
 Absence of title in vendor at time of contract, 736. 
 
 Waiver of condition in, 838. 
 
 Contracts within the statute of frauds, 1397-1414. 
 
 Easements ; right of way, 1397. 
 
 Contraetito buy, and to hold in trust, 1398. 
 
 Standing trees, 1400. 
 
 Growing croi>s, 1403 n. 
 
 House to be severed and removed, 1403. 
 
 Contract to buy and sell land and divide proceeds, 1408, 1409. 
 
 Compromise as to boundary line, 1411. 
 
 Parol partition, 1414 n. 
 
 Memorandum must identify the property, 1446. 
 
 SATISFACTION, 
 
 Part payment as, 320, 328. 
 
 See Accord and Satisfaction. 
 
 SATISFACTION AS A CONDITION, 
 Of architect, 636, 662 n. 
 Of owner, 647, 670, 675, 678. 
 
 In cases involving personal taste, 647, 661, 670, 675. 
 Of employer in service contracts, 662, 664. 
 In sales with privilege of return, 673 n. 
 In option contracts, 673 n. 
 Equipment taken on trial or on approval, 674, 677. 
 
 SAVINGS DEPOSIT, 
 
 Assignment by gift, 1132, 1134 n. 
 
 SCRAWL, 
 
 In place of a seal, 457-462. 
 
 SEAL, 
 
 Offer under, 200. 
 
 Release ilnder, 928-944, 953, 1005, 1022. 
 
 Presumptive evidence of consideration, by statute, 928, 930. 
 
 Addition _of, is material alteration, 1028. 
 
 What Is a seal 455-462. 
 
 See Contracts under Seal. 
 
1508 INDEX . 
 
 [The figures refer to pages] 
 
 SEALED INSTRUMENT, 
 
 Discharge by surrender or cancellation, 946. 
 Discliarge by accord and satisfaction, 1020, 1021. 
 Rescission by parol, 1023. 
 Release under seal, 1022. 
 
 SEAMAN'S WAGES, 343. 
 
 SECONDARY OBLIGATION, 479. 
 
 SECONDARY RIGHTS, 
 
 To damages, assignment of, 1182, 1185 n. 
 
 SECURITY, 
 
 Giving of, as condition precedent, 512, 514. 
 
 SEPARATION AGREEMENTS, 
 When illegal, 1315 n. 
 
 SERVICE CONTRACT, 
 
 Rescinded, with re-employment at higher salary, 354. 
 Satisfaction of employer as a condition, 662, 664. 
 Conditions in, 617-628, 662. 664. 
 Effect of death, of employer, 879. 
 
 Of servant, 882 n. 
 Master prevents performance by servant, 820. 
 Contracts in restraint of trade, 1215, 1251, 1204 n. 
 
 Contract to serve more than a year, statute of frauds, 1418-1429, 1453. 
 Sufficiency of memorandum to satisfy statute, 1453. 
 Breach of contract by changing duties, 1453. 
 
 SERVICES, 
 
 Of husband as consideration, 382. 
 
 SEVERAL CONTRACTS, 
 See Joint Contracts. 
 
 SHAREHOLDER, 
 
 Illegal contract to induce vote, 1341. 
 
 SHERIFF, 
 
 Performance of duty as a consideration, 381. 
 
 SHERMAN ANTI-TRUST LAW, 1239 n. 
 
 Assignment of right to damages under, 1185 a 
 
 SHIPMENT OF GOODS, 
 
 As acceptance of offer, 67 ii, 92, 99. 
 
 SICKNESS, 
 
 As excuse for nonperformance, 617. 
 
 SIGNATURE, 
 
 To contract under seal, 462. 
 
 By initials satisfies statute of frauds, 1443. 
 
 Of party to be charged, 1444, 1458. 
 
 By agent, satisfies statute, 1445. 
 
 Of only one party, 1444 n. 
 
 In the body of instrument, 1449. 
 
 SIIjENCE, 
 
 ■As acceptance, 80-93. 
 As acceptance of a counter ofCer, 93 n. 
 As a waiver of conditions, 836 n. 
 
 SMUGGLING, 
 
 Contract to facilitate, 1363. 
 
 SOLE BENEFICIARIES, 
 
 Of contracts made by others, 1040-1045, 1060, 1061, 1066, 1069, 1073. 
 See Third Party Beneficiaries. 
 
INDEX 1509 
 
 [The figures refer to pages] 
 
 SPECIALTIES, 455-477. 
 Discharge of, 1020-1025. 
 Revival of debt barred by statute, 420 n. 
 Conditions in, 508. 
 
 SPLITTING, 
 
 Cause of action for damages to accrue in future, 664. 
 STAKEHOLDER, 
 
 Recovery by loser from, 1259. 
 STATUTE OF FRAUDS, 1374-1476. 
 Contracts of guaranty, 1375-1394. 
 Consideration of marriage, 1394^-1397. 
 Sales of land, 1397-1414. 
 Not to be performed in one year, 1414^-1429. 
 Sales of goods, 1430-1442. 
 The memorandum required, 1443-1463. 
 Legal operation of, 1462, 1484-1476. 
 Contract for an easement, 1397. 
 Contract to buy land and to hold in trust, 1398. 
 Sale of standing trees, 1400. 
 Growing crops, 1403 n. 
 Sale of house to be severed, 1403. 
 Fixtures to be severed, 1407 n. 
 Partnership to buy and sell land, 1408. 
 Compromise as to boundary line, 1411. 
 Promise to be performed at an uncertain time, 1414. 
 Difference between termination and performance, by death, 1417, 1418. 
 Effect of reserved power to terminate contract on notice, 1420. 
 Contract to work for more than a year, 1418-1429. 
 
 Contract performable within a year by one party, but not by other, 1422. 
 When year begins and ends, 1425. 
 The signature required, 1443, 1446. 
 Several letters or docuijients may operate as a memorandum, 1446, 1456, 
 
 1458 n, 1461 n. 
 Letter of authority to agent not a memorandum, 1458. 
 Memorandum made after action brought will not do, 1462. 
 Effect of full i)erformance by one party, 1464. 
 Variation of written contract by parol agreement, 1467. 
 Parol waiver of condition, 1467. 
 As prescribing a rule of evidence, 1462, 1472. 
 Power to validate an oral contract, 429, 1472, 1475 n. 
 Incomplete memorandum, 1472. 
 Affects substance, not merely procedure, 1475 n. 
 Pleading and proof, 1476 n. 
 Among contracts not within, are : ^ 
 
 Those where no third party is bound, 1376, 1377 n. 
 
 Novation, a substituted debtor, 1377. 
 
 Promise to a debtor to pay his debt, 1380. 
 
 Some contracts of Indemnity, 1380. 
 
 Promise, for beneficial consideration, to pay another's debt, 1384, 1385. 
 
 Promise to pay out of debtor's assets in promisor's hands, 1391 n. 
 
 Pledge of goods as security, 1392. 
 
 Engagement to marry, 1396 n. 
 
 Sale of house, to be severed, 1403. 
 
 Partnership to deal in land, 1408, 1409. 
 
 Boundary line compromise, 1411. 
 
 Oral partition of land, 1414 n. 
 
 Contract to be performed at an uncertain time, 1414. 
 
 For support for life, 1414. 
 
 Not to compete for five years, 1417. 
 
 For a year's service to begin on next day, 1425. 
 
 To make a chattel to special order, 1443. 
 
 See Guaranty ; Marriage ; Sale of Land ; Sale of Goods. 
 
1510 INDEX 
 
 [The figures refer to pagesl 
 
 STATUTE OF LIMITATIONS, 
 Waiver of bar, 415-425. 
 Agreement not to use It as a defense. 421. 
 Part payment as' waiver, 423. 
 Operation in case of anticipatory repudiation, 777. 
 
 STATUTES, 
 
 Judicial interpretation of, 1420. 
 
 STIFLING A PROSECUTION, 1289-1293. 
 
 STOCK EXCHANGE, 
 
 Contracts for sale on margin, 1265, 1270. 
 STRANGER, 
 
 Alteration by, 1027 n, 1030 n. 
 
 To tbe consideration, see Third Party Beneficiaries. 
 
 STRIKE CLAUSE, 
 
 In contract to deliver, 488. 
 Mischance by fire and water, 721. 
 
 STRIKES, 
 
 As excuse for nonperformance, 918. 
 
 SUBCONTRACT, 
 
 Effect of cancellation of principal contract, 875. 
 
 SUBMISSION TO ARBITRATION, 
 Revocation of, 1031, 1034. 
 
 SUBROGATION, 
 
 Of beneficiary to rights of promisee,. 1(K6, 1080, 1110 n. 
 
 SUBSCRIPTION, 
 
 For shares, 31, 64 n. 
 
 To newspaper, 85. 
 
 For shares of stock, with option to return, 311. 
 
 Charitable, consideration for, 242, 245. 
 
 For business purposes, 248. 
 
 Joint and several, 1190. 
 
 SUBSCRIPTION CONTESTS, 190 n. 
 
 SUBSEQUENT CONDITIONS, 
 See Conditions Subsequent. 
 
 SUBSTANTIAL PERFORMANCE, 
 
 As condition precedent, 639, 647-660. 
 
 Form of pleading, 659. 
 
 Proof of, after pleading full performance, 841 n. 
 
 SUBSTITUTED CONTRACT, 
 As a discharge, 959-979, 984. 
 By parol, for a specialty, 1023. 
 Not a guaranty within statute of frauds, 1377. 
 
 SUNDAX LAWS, ' 
 
 Contracts illegal under, 1320. 
 
 Plaintiff ignorant that defendant was violating, 1370. 
 
 Ratification of contract within, 428. 
 
 SUPPORT, 
 
 Repudiation of contract to furnish, 777, 784. 
 For life, oral contract for, 1414. 
 
 SURETY, 
 
 Discharged by an extension, of time to principal. 340. 
 
 Promise of. contribution by a co-surety, 361. 
 
 Death of one joint surety, 1193. 
 
 Right of contribution, 1194 n. 
 
 Effect of covenant not to sue the principal, 1196. 
 
INDEX ]^521 
 
 [The figures refer to pages] 
 STJRETT BONDS, 
 
 Rights of laborers and materialmen, 1095-1103 1107 n 
 SURETYSHIP, 
 
 Notice of default by principal, 6^. 
 implied conditions in contract of, 686-691 
 
 Pro^It"«''L>v.'"'^.*^; t^^"^ °" '^"ty to pay premiums, 690. 
 Promises within statute of frauds, 1375-1394. 
 f romise to indemnify a surety, 1382, 1383 n 
 See Guaranty. 
 SURRENDER, 
 
 Of rights, prlyUeges, or powers, as consideration, 258 n, 260 n. 
 Of instrument, as a discharge, 945-948 . ^"" ". 
 
 SURVIVAL, 
 
 In case of death in common disaster, 709. 
 SURVIVORSHIP, 
 
 In case of Joint contracts, 1193, 1201. 
 SUSPENSION, 
 
 Of cause of action, 936, 937. 
 
 By acceptance of a negotiable note, 942, 982. 
 By composition agreement, see Accord Executory., 
 By release with a condition subsequent, 930, 987 n. 
 SUSPENSIVE CONDITION, 480. 
 
 TACIT ACCEPTANCE, 52-60, 60-80. 
 Silence as, 80^93. 
 
 TAXATION, 
 
 Consideration for exemption, 226. 
 TELEGRAPH, 
 
 Contract by, 142. 
 
 Acceptance by, 44, 102, 168. 
 
 Mistake in message, 118. 
 
 TELEPHONE, 
 
 Acceptance by, 42 n. 
 TENDER, 
 
 Of payment as a condition precedent, 504, 506, 508, 516. 
 
 Of a deed to land, 518, 521, 522, 527, 551, 555, 558. 
 
 Waived, by repudiation, 729-739. 
 
 Insufficient tender as a breach 776^ , 
 
 Effect of, after a repudiation, 788. 
 
 Of cash payment by insolvent buyer, 847, 849 n. 
 
 Of payment, effect of, 957. 
 
 Of part of sum due, 958. 
 
 Of goods, 958 n. 
 
 Of satisfaction as provided in an accord, 979-986. 
 
 THIRD PARTY BENEFICIARIES, 376, 1040-1110. 
 
 Sole beneficiaries, 1040-1045, 1060, 1061, 1069, 1073. 
 
 Creditor beneficiaries, 1045-1060, 1075-1110. 
 
 Mortgagees, 1055, 1075-1091. 
 
 Incidental and unintended, 1057, 1091-1103. 
 
 Compared with trust beneficiaries, 1049, 105'4. 
 
 Rights of the promisee, 768, 771, 775 n, 1013. 
 
 Power of promisee to discharge, 1078, 1085, 1103, 1105. 
 
 Rights based on theory of agency, 1050, 1088. 
 
 Rights based on theory of novation, 1089, 1108, 1110 n. 
 
 Rights based on theory of suretyship, 1056, 1080, 1089. 
 
 Rights by subrogation, 1036, 1080. 
 
 Debt discharged by payment by another, 1013. 
 
 Necessity of obligation on promisee toward beneficiary, 1055, 1061, 1080. 
 
1512 INDEX 
 
 [Tlie figures refer to pages] 
 
 THIRD PARTY BENEFICIARIES— Continued, 
 
 Rignts of citizens on public contracts witli water companies, 1058 n. 
 
 Assets in promisor's liands in trust for, 1059, 1066, 1089, 1094 n, 1103, 1182. 
 
 Rigtits may be conditional, 1059, 1095-1105, 1108. 
 
 Holding assignment from promisee, 1086 n, 1182. 
 
 Rights of laborers and materialmen on surety bonds, 1095-1103, 1107 n. 
 
 Of contracts under seal, 1103. 
 
 Of a contract voidable for fraud) infancy, or mistake, 1107 n. 
 
 Election between rights, 1110 n. 
 
 The promise an additional security, 1108, 1110 n, 1171 n. 
 
 Effect of blood relationship, 1041, 1043, 1048, 1061, 1066, 1089, 1073. 
 
 Of public contracts, 1058 n, 1063. . 
 
 Of insurance policies, 1066 n, 1069, 1105 u, 1108. 
 
 Massachusetts law, 1073. 
 
 TICKET, 
 
 Containing terms of contract, 124 n. 
 
 TIME OF PERFORMANCE, 
 
 Said to be of the essence, 575. 
 
 Performance on time as a condition, 600-617. 
 
 Time of sailing, in charter party, 693. 
 
 Of the essence in options, 203. 
 
 When of the essence, reasonable time, 833. 
 
 Re-establishment as a condition by notice, after a waiver, 833, 837 n. 
 TIME LIMIT, 
 
 On right of action, 702, 703, 713. 
 
 TIME-TABLE, 
 
 As an offer, 180 n. 
 
 TITLE OF VENDOR, 
 
 At date of contract as a condition, 844, 857 n. 
 
 EfCect of conveyance to another, 844, 855. 
 
 Defective at time set for conveyance, 859, 860. 
 TORT, 
 
 Forbearance to commit, as a consideration, 386. 
 
 Revival of remedy after barred by statute, 420 n. 
 
 To the person, right to damages not assignable, 1185 n. 
 
 Contract inducing ' crime or, 1322. 
 
 TOTAL BREACH, 
 
 Single right of action, 664. 
 
 TRADE CIRCULAR, 
 As an offer, 4. 
 
 TREES, 
 
 Standing, contract to sell, 1400. 
 
 TRUST BENEFICIARY, 
 
 Compared with contract beneficiary, 1049, 1052, 1067. 
 
 UNFORESEEN DIFFICULTIES, 
 
 As reason for increased compensation, 350, 359. 
 
 UNILATERAL CONTRACT, ' 
 
 Reward cases, 17-26. 
 
 Acceptance by act, 52-80, 145, 189-205. 
 
 Offer of an act for a promise, 83-93, 145. 
 
 Guaranty contracts, 73, 181, 184. 
 
 Under seal, 200. 
 
 Reliance on a promise as a consideration, 222-252. 
 
 Forbearance as consideration, 2.52-292, 308, 332. 
 
 Compared with bilateral, 236, 283-292, 298, 30O, 314 n, 315 332 377 
 
 Of option, 613. 
 
 Of insurance, 866. 
 
 Parol discharge, of, 949-957. 
 
AiNDEX 1513 
 
 [The figures refer to p?iges] 
 
 UNILATERAL MISTAKE, 121, 124. 
 
 Known to other party, 127. 
 UNJUST ENRICHMENT, 
 
 Basis of quasi contract, 134. 
 See Quasi Contract. 
 
 UNLIQUIDATED CLAIM, 
 
 Part payment as satisfaction, 328, 332 n, 1006, 1009. 
 UNREASONABLE DISSATISFACTION, 
 
 Of owner, in building contracts, 647, 675, 677, 678. 
 
 Where certificate of architect is required, 628-647. 
 See Satisfaction as a Condition. 
 
 USURY, 
 
 Waiver of defense, 425. 
 
 VALUATION, 
 
 By appraisers, as a condition, 493, 496, 500. 
 VARIANCE, 
 
 Between plaintiff's declaration and liio proof, 719, 721. 
 
 By proof of waiver after pleading full performance, 840, 841 n. 
 
 VARIATION, 
 
 By parol agreement, of written contract within statute of frauds, 1467. 
 
 VEXATIOUS CLAIMS, 
 
 See Compromise : Forbearance. 
 
 VOID CLAIM, 
 
 Forhearanqe to press, as consideration, 268-292. 
 
 VOIDABLE CONTRACT, 
 
 Ratification of, 393, 405-448. 
 
 Rights of a third party beneficiary, 1107 n. 
 
 VOIDABLE PROMISE, 
 As consideration, 293. 
 
 VOLUNTARY DISCHARGE, 
 
 Revival of duty by new promise, 4 14 41 8.' 
 
 VOLUNTARY SERVICE, 
 
 As a consideration, 399, 400. 
 See Past Consideration. 
 
 VOTING CONTEST, 190 n. 
 
 Conditions in contract for, 548. 
 
 VOTING TRUST, 
 
 Legality of, 1343 n. 
 
 WAGERING CONTRACTS, 1257-1273. 
 Loan for wagering purposes, 1259 n. 
 Recovery by loser from stakeholder, 1259. 
 On stock and produce exchanges, 1265, 1270. 
 Distinguished from speculation, 1265. 
 One party ignorant of other's illegal intent, 1371 n. 
 Conditions in, 685. 
 
 See Aleatory Contract. 
 
 WAGES, „^„ „,. „_. 
 
 Consideration for an increase, 343, ^544, da*. 
 Action for, by discharged servant, 794. 
 Not yet due, assignment of, 1127. 
 
 WAIVER. 
 
 Of defense of infancy, 393, 4^5-413- 
 Of statute of limitations, 41^5. 
 Of aischarge in bankruptcy, 435-44<i. 
 Of defense of usury, 425. 
 
1514 INDEX #, 
 
 [The figures refer to pages] 
 
 WAIVEEr-Continued, 
 
 Conditional waiver of defense, 410, 423, 437, 439. 
 Of demand and notice in bills and notes, 432. 
 Of right to damages, 831. 
 Discharge of contract by, 948-957. 
 
 WAIVER OP CONDITION, 823-842. 
 Of performance on time, 823 n. 
 Distinguished from estoppel and substituted contract, 825 n, 826, 836 n, 
 
 1467. 
 Consideration not necessary, 830. 
 By failure to object on that ground, 836. 
 In sale of land, 838. 
 
 Not provable unless specially pleaded, 840, 841 n. 
 By repudiation, 729-739, 747, 757, 762. 
 
 By making performance impossible, 731, 733, 758, 858, 874. 
 Distinguished from estoppel, 706. 
 Of condition subsequent, 703. 
 
 WAR, 
 
 As excuse for nonpayment of insurance premiums, 866. 
 Clause concerning strikes and causes beyond control, 920 n. 
 Danger of capture as excuse for nonperformance, 924. 
 Making further performance illegal, 927 n. 
 Economic unprofitableness caused by, 928 n. 
 Effect of, on condition subsequent, 703 n. 
 
 WARRANTY, 
 
 Of truth of a representation of fact, 693. 
 
 Of soundness, condition subsequent to, 713. 
 WILLFUL DEFAULT, 
 
 Of servant or employg, 617-628. 
 
 By building contractor, 647, 654, 656, 660 n. 
 
 WITNESS, 
 
 Promise of extra compensation, 369, 370 n. 
 
 WITNESSING CLAUSE, 463.> 
 WORK AND LABOR, 
 
 Distinguished from sale of goods, 1430, 1433. 
 
 WRITTEN CONTRACT, 
 
 Consideration necessary, 220. 
 Presumption of consideration, 222 n, 474. 
 Intention to reduce to form of, 11, 14. 
 
 WRONG, 
 
 Contracts inducing crime or private. 1322-1356. 
 
 •WEBT FrBLI9HINQ CO., PRINTERS, ST. PAUL, MIKN.