Story Case

Mr. Van Revel and Mr. Millikan owned summer homes near Lake Geneva. Mr. Millikan owned a small sail boat, which he desired to sell. He offered it to Mr. Van Revel for $950. The latter replied that he would purchase it, if Mr. Millikan would paint it, put on new sails, and deliver it within ten days. Mr. Millikan caused the desired improvements to be made. Seven days later, he sailed the boat up to Mr. Van Revel's landing and told him that the boat was ready. Mr. Van Revel found no complaint with the work done, but said that he had decided that he would not purchase a boat. Mr. Millikan, however, refused to accept his repudiation of the contract. He anchored the boat at the landing with the remark: "I have done all I am legally bound to do; the boat is now yours." That night the boat was wrecked in a storm. Whose loss was it?

Ruling Court Case. Barney Vs. Bliss, Volume 1 D. Chipman Reports, Page 399; Same Case, Volume 12 American Decisions, Page 696

Bliss executed a contract to Barney, by which he promised to deliver to the latter ten thousand good, merchantable pine boards, on October 1, at the saw mill of the former. It was shown by Bliss that, on the 1st of October, the boards were sawed and ready to deliver at his saw mill. He showed also that he remained there from early morning until sundown of that day, ready and willing to deliver the boards to Barney, but that Barney did not appear. Thereafter, Bliss refused to deliver, and Barney brought this action for damages.

Bliss contended that his readiness and willingness, on the day and at the place, to deliver the boards, was a good tender, and that thereafter his obligation on the contract was at an end.

Decision

A tender is an offer on the part of a person, who is under an obligation to perform that obligation. Where the obligation, as in this case, is the delivery of personal property, a good and sufficient tender discharges the obligation under the contract. If there is a good tender, the property becomes the property of the other contracting party, although it continues to remain in the possession of the seller. The Court, however, was of the opinion that in this case there was not a sufficient tender, although the seller was ready and willing during the whole of the day agreed upon and at the place stipulated, to deliver the property. He should have taken some actual steps manifesting his intention to deliver. He should have taken reasonable steps to notify Barney that the property was ready for delivery. Failing in this the tender was not good.

Mr. Chief Justice Skinner said: "It may be laid down as a general rule, that when contracts are made for the delivery of goods, or any article other than money, a tender of the thing contracted for according to the contract, though refused to be accepted by the promisee, absolutely discharges the contract".

Judgment was given for Barney because a sufficient tender was not shown.

Ruling Law. Story Case Answer

We have seen that when the obligation of a contract is to pay money, payment in legal tender, or in the manner authorized, is a discharge of the obligation. But a tender of money due, although refused, does not constitute a discharge of the contract. Its only effect is to stop the running of interest, and, in case suit is brought for the money due, the party refusing the tender must bear the cost of suing thereafter. But when the obligation of a contract is not for the payment of money, the obligation of a contract is discharged by a good tender. A tender consists in offering to perform at the stipulated time and place of performance. The law requires that the person making the tender shall take actual steps to make the tender. Mere passivity at the time and place of performance is not a good tender, although the person is ready and willing to perform. In the Story Case, Mr. Millikan's acts constituted a good and sufficient tender. Thereafter his obligation on the contract was at an end. The boat became the property of Mr. Van Revel, and the loss of the boat was his.