Story Case

Hakins, an auctioneer, caused signs to be put up in his rooms which read:

"Notice! Terms are Cash." Thomas bid in a horse for $200, and when he proposed taking the horse away, he offered to give his note for the amount. Hakins refused to take a note and showed the signs. Thomas answered:

"Yes, I saw the signs but I never pay cash." Hakins asserted that he never sold for anything but cash. Whereupon, Thomas refused to take the horse. Hakins sued him for breach of contract to buy and pay cash for the horse.

Thomas defends, on the grounds that the signs were made to the public, not to him personally. Is the defense good?

Ruling Court Case. Eollister Vs. Nowlen, Volume 19 Wendell's New York Reports, Page 234; Volume 32 American Decisions, Page 455

Nowlen was the proprietor of a stage coach line running between certain points in the state of New York. He caused to be printed certain notices, to the effect that all baggage would be carried at the risk of the owner. Copies of this notice were posted in the stage office, and in all public houses along the coach line. Hollister, on July 20, 1833, left Avon for Buffalo on Nowlen's coach, with his trunk fastened to the back by a rope. After proceeding about three miles, it was found that the rope had been cut and that the trunk and its contents had been stolen. Thereupon, Hollister sued to recover the value of the trunk and its contents.

The defense of the defendant, Nowlen, consisted in the fact that the public notice became a term in his offer to carry the public on his coach; and that Hollister was bound by its provisions.

Decision

Such a general notice as this, if made evident to the public, might be considered a term in a contract in ordinary cases; but in the case of common carrier, where an extraordinary liability exists, such a general notice does not constitute a part of the contract of carriage, unless it is expressly assented to by the passenger.

Mr. Justice Bronson said in part: "The argument is that where a party delivers goods to be carried, after seeing a notice that the carrier intends to limit his responsibility, his assent to the terms of the notice may be implied. But this argument entirely overlooks a very important consideration. Notwithstanding the notice, the owner has a right to insist that the carrier shall receive the goods subject to all the responsibility incident to his employment. If a coat be ordered from a tailor, after he has given the customer notice that he will not furnish the article at a less price than $100, the assent of the customer to pay that sum, though it be double the value, may perhaps be implied. But if the tailor had been under a legal obligation, not only to furnish the coat, but to do so at a reasonable price, no such implication arises. He has no right to prescribe any other terms; and a notice can, at most, amount to a proposition for a special contract, which requires the express assent of the other party".

Judgment was given for Hollister in this action.

Ruling Law. Story Case Answer

A term or condition may become a part of a contract when made publicly, if it can be shown that the party affected thereby, knew or should have known of its existence. In the case of Hollister vs. Nowlen the Court was of the opinion that such a notice must be definitely asserted to the party, in order that a common carrier might limit its liability. But, in general, a public notice will be binding upon persons unless they can show that they were not informed of it, and had no means of discovering it.

In the Story Case, Thomas would lose. He had notice of the requirement for cash before he bid on the horse. When the notice reached him it became part of the offer to sell to the highest bidder. Hence, by accepting the offer of sale by bidding highest, he accepted the stipulation of the offer, - namely that cash was required.