It is in regard to contracts to discharge a debt of the promisee that the greatest confusion prevails. In the first place the intrinsic difficulty of the case is greater than where the third person is the sole beneficiary of the contract. Trust, agency, novation, must here be carefully distinguished, and the facts may not clearly indicate in which class a particular case belongs, since the parties may not have sufficiently expressed any intention. Further, it is in this class of cases that the reasoning of the courts is most artificial. New York by the decision of Lawrence v. Fox 24 has done more than any other jurisdiction to spread and strengthen the theory that a third person has a direct right of action on such a contract. In a later case 25 the New York court said: "It is not every promise made by one to another from the performance of which a benefit may inure to a third, which gives a right of action to such third person; he being neither privy to the contract, nor to the consideration. The contract must be made for his benefit as its object, and he must be the party intended to be benefited."
This language, or similar language, is adopted in other cases.26 It seems hard to suppose, however, that the courts
155 Ind. 539, 58 N. E. 701, 52 L. R. A. 305.
23To similar effect is Anders v. Gardner, 151 N. C. 004, 66 S. E. 065; and in Chicago, etc., R. R. v. Bell, 44 Neb. 44, 62 N. W. 314, an agreement not to sue a third person was effectively used as a bar to an action against the latter. See also Ayer's Appeal, 28 Pa. 179.
2420 N. Y. 268.
25Simeon v. Brown, 68 N. Y. 355, 361.
26Central Trust Go. v. Berwind-Wbite Co., 95 Fed. 391; Thomas Mfg. Co. v. Prather, 65 Ark. 27, 44 S. W. 218; Hall v. Alford, 20 Ky. L. Rep, 1482, 49 S. W. 444; Jefferson v. Asch. 53 Minn. 446,55 N. W. 604,25 L. R. A. 257, 39 Am. St. Rep. 618; Clark p. Hennessey Const. Co., 122 Minn. 476, 142 N. W. 873; State v. St. Louis, etc, Railwhich use it really believe that the intent of the promisee in such a case as Lawrence v. Fox is to benefit the third party. When a grantor of premises subject to a mortgage requires the grantee to assume and agree to pay the mortgage, is it the road, 125 Mo. 596, 617, 28 S. W. 1074; Garney v. Rogers, 47 N. Y. 233, 7 Am. Rep. 440; Vrooman v. Turner, 60 N. Y. 280, 283, 25 Am. Rep. 195; Bev-eridge v. New York Elevated Railroad, 112 N. Y. 1,26,19 N. E. 489,2 L. R. A. 648; Mollison v. Gubelman, 170 N. Y. 8. 985; Parker v. Jeffery, 26 Oreg. 186, 188, 37 Pac. 712; Davidson v. Madden, 89 Oreg. 209, 173 Pac. 320. In Silver King Coalition Mines Co. v. Silver King C. M. Co., 204 Fed. 166, 175, 122 C. C. A. 402, however, Sanborn, J., said, after quoting the extract from the New York decision here quoted in the text: "Many authorities are cited that have repeated or approved this statement of the law. Austin v. Seligman, 18 Fed. 519, 522; Sayward v. Dexter, H. A Co., 72 Fed. 758, 764, 765, 19 C. C. A. 176; Constable v. National Steamship Co., 154 U. S. 51, 74, 14 S. Ct. 1062, 38 L. Ed. 903; American Exchange National Bank v. Northern Pac R. Co., 76 Fed. 130; Central Trust Co. v. Berwind-White Coal Co., 95 Fed. 391; Electric Appliance Co. v. United States F. & Co., 110 Wis. 434,85 N. W. 648,63 L. R. A. 609, 613; Parker v. Jeffery, 26 Or. 186, 37 Pac. 712; Burton v. Larkin, 37 Kans. 246,250,13 Pac. 398,59 Am. Rep. 641; Howamon v. Trenton Water Co., 119 Mo. 304, 308,24 S. W. 784, 23 L. R. A. 146, 41 Am. St. Rep. 654; Wright v. Terry, 23 Fla. 160, 2 So. 6. But none of these cases was a suit in equity and in none of them were the equitable doctrines that a creditor may have the benefit of any security or obligation given by the principal debtor to the surety, and that, to avoid circuity of action, the creditor may be, and is, when he sues upon the contract of the grantee to pay the tatter's indebtedness to the creditor, in equity substituted for the grantee and promisee, upon which this suit stands, either invoked or available. Authorities are conflicting upon the proposition that it is essential to the maintenance of an action at law by the creditor of a grantor upon the contract of his grantee to pay the grantor's debts that the contract should be made for the creditor's benefit as its object and that he should be the party intended to be benefited. Coster v. Mayor, 43 N. Y. 300, 411, and cases there cited; Arnold p. Nichols, 64 N. Y. 117, 119. That, however, is a moot question in this case. It is unnecessary to consider or discuss it, and it is here dismissed, because this is a suit in equity, and not an action at law. In such a suit it is sufficient that the grantee has agreed with the grantor to be primarily liable for the hitter's obligation to the creditor, so that, as between the parties to the agreement, the first is the principal and the second the surety. The creditor of the surety is then entitled in equity to be substituted in his place, and to maintain his suit against the grantee to the same extent as the grantor could have maintained it, and it is immaterial whether the contract was made and intended for the benefit of the creditor or of the grantor, for the creditor has all the rights of both to enforce the obligation of the grantee. Keller v. Ashford, 133 U. S. 610, 623, 10 S. Ct. 404, 33 L. Ed. 667, and the authorities there cited; Barker v. Pullman's Palace Car Co., 124 Fed. 555, 568, 569; Willard v. Wood, 164 V. S. 502, 510, 520, 17 8. Ct. 178, 41 L. Ed. 531; Johns v. Wilson, 180 U. S. 440, 447, 448, 21 S. Ct. 445, 45 L. Ed. 613." welfare of the mortgagee that the grantor is considering, or is it his own?