The Law Of Contracts | by Samuel Williston

One who attempts to write on any topic of the law is likely to realize that what Maitland said of the historian is also true of the law writer, he is tearing a seamless web. The law cannot be divided into parts marked by exact boundaries, and the problem of where to stop continually confronts him. But however vague may be the boundaries of contract, it fills so larg a space in the law that the most formidable obstacle presented to one who chooses the subject is its magnitude. Included within it are large portions of what is contained in works on Vendor and Purchaser, Sales of Personal Property, Negotiable Instruments, Agency, Bailments, Carriers, Landlord and Tenant, Insurance, Suretyship, Equity, Master and Servant, Quasi-Contract, Damages, Evidence.

Title	The Law Of Contracts
Author	Samuel Williston
Publisher	New York Baker, Voorhis & Co.
Year	1922
Copyright	1920, Samuel Williston
Amazon	Treatise on the Law of Contracts

By Samuel Williston, LL.D. Dane Professor Of Law In Harvard University

Preface: One who attempts to write on any topic of the law is likely to realize that what Maitland said of the historian is also true of the law writer, he is tearing a seamless web. The law cannot be divided ...

Williston On Contracts. Introductory. Chapter I. Definition Of Terms: Contract................................. 1 Agreement........................ 2 Express and implied contracts; quasi-contracts.....

Sec. 1. Contract: A contract is a promise, or set of promises, to which the law attaches legal obligation. This definition may seem somewhat unsatisfactory since it is necessary subsequently to define the circumstances...

Sec. 2. Agreement: An agreement is an expression by two or more persons of assent in regard to some present or future performance by one or more of them.4 Agreement is in some respects a wider term than contract. It cov...

Sec. 3. Express And Implied Contracts; Quasi-Contracts: Contracts are express when their terms are stated by the parties. Contracts are implied when their terms are not so stated. The expression implied contract has given rise to great confusion in the l...

Sec. 8. Real Contracts: The term real contract is in common use in the civil law, and though not commonly used by judges or writers in the common law, nevertheless describes certain obligations known to the common law from...

Sec. 9. Account: The obligation to account arose when property was received by a guardian, bailiff, or receiver. In effect the defendant in these cases was a trustee, since under the early law the seisin of property p...

Sec. 10. Detinue: Detinue was the only action allowed by the common law to recover specific goods except in the few instances where replevin would lie. The obligation upon which detinue was based arose from the poss...

Sec. 11. Debt: To the modern analyst of the law debt does not seem a real contract; since the obligation of the debtor is not to repay specific money but merely a certain amount of money. In the early law, however, ...

Sec. 12. Simple Or Parol Contracts: Contracts which derive their efficacy from the substance of the transaction rather than its form are called simple contracts. The essential requisites for simple contracts are the mutual assent of the...

Sec. 13. Bilateral And Unilateral Contracts; Bifactoral And Uni-Factoral Obligations: A vital distinction in contracts exists between (1) those where each party promises some performance and, (2) those where only one party promises performance, the consideration from the promisee being...

Sec. 16. Unenforceable Contracts: Agreements which are neither void nor voidable may, nevertheless, be unenforceable by one or both parties. If such contracts produced no legal consequences whatever, they would not be contracts at all...

Book I. Formation Of Contracts. Chapter II. Requisites Of Simple Contracts: Simple contracts the typical kind........... 17 Requirements for the formation of a simple contract.......... 18 Legality of con...

Sec. 18. Requirements For The Formation Of A Simple Contract: The requirements for the formation of a simple contract are: (1) Parties of legal capacity; (2) an expression of mutual assent of the parties to a promise, or set of promises, (3) an agreed valid cons...

Sec. 19. Legality Of Contract: A writer whose work on contracts has had great currency,4 enumerates as requisite for the formation of contract the legality of the object which the contract proposes to effect, and this statement has...

Sec. 20. Genuineness Of Consent: The writer referred to in the preceding section has also stated as a requirement for the formation of contracts genuineness or reality of consent of the parties, and under this heading has included th...

Sec. 21. Intent To Contract: The further statement of Savigny which has been popularized for English and American lawyers by Sir Frederick Pollock and others, that not only mental assent to a promise in fact, but an intent to for...

Chapter III. Making Of Offers: Mutual assent must be expressed.................. 22 Assent may be expressed by acts.................... 22a Mutual assent is ex...

Sec. 22. Mutual Assent Must Be Expressed: It is customarily said that mutual assent is essential to the formation of simple contracts, but it should further be stated that the mutual assent must be expressed by one party to the other, and exc...

Sec. 22a. Assent May Be Expressed By Acts: Though assent must be expressed in order to be legally effective, it need not be expressed in words. In the early law of assumpsit stress was laid on the necessity of a promise in terms, but the moder...

Sec. 23. Mutual Assent Is Expressed Ordinarily By An Offer And An Acceptance: As simple contracts can be formed only by an expression of assent of the parties to the terms of the promise and to the consideration for it, it is ordinarily necessary for one of the parties to propo...

Sec. 24. Requirements Of A Promise: A promise from the very meaning of the word involves an undertaking to do something in the future. A presently executed agreement is not a promise. As the typical offer is a promise though one in term...

Sec. 25. An Offer Is A Promise: An offer is a statement by the offeror of what he will give in return for some promise or act of the offeree. As the offeror's statement necessarily looks to the future, it must always be promissory i...

Sec. 27. An Offer Distinguished From Preliminary Negotiations: Frequently negotiations for a contract are begun between parties by general expressions of willingness to enter into a bargain upon stated terms and yet the natural construction of the words and condu...

An Offer Distinguished From Preliminary Negotiations. Continued: 21 This criticism is applicable to Harvey v. Facey [1893], A. C. 552. The plaintiff there telegraphed the defendant, Will you sell us Bumper Hall Pen. Telegraph lowest cash price. In reply the defen...

Sec. 28. Agreements Preliminary To Written Contracts: The distinction between preliminary negotiations and completed contracts is often involved in cases where the parties contemplate the execution of a written agreement. It is everywhere agreed to be po...

Sec. 29. Formation Of Contracts At Auction: As an original question it seems fairly open to argument whether an auctioneer by putting up goods for sale makes an offer which ripens into a contract or sale when the highest bidder accepts the offe...

Sec. 30. Contracts Preliminary To Auction Sales: Since it has been held that no contract for the sale of goods is complete until the hammer falls, it necessarily follows that even though an auction sale has been advertised to be without reserve, or ...

Sec. 32. General Offers: Though offers are ordinarily made to specific persons, it is possible to make offers to any one, or to every one, who may perform a specified act or make a specified promise. The commonest illustratio...

Sec. 32a. Obligations Imposed By Law Without Assent Distinguished: The advertised time-table of a railroad has been held part of a general offer which becomes binding when accepted by the purchase of a ticket.64 It seems difficult, however, to regard such an advertis...

Sec. 33. An Offer Must Be Communicated; Rewards: In the nature of the case it is impossible for an offeree actually to assent to an offer unless he knows of its existence. A simple contract when not based on actual consent at least requires what the...

Sec. 34. An Offer By Mail Must Be Received: It was laid down in the leading case of Adams v. Lindsell,77 that the offerors must be regarded As making during every instant of the time their letter was travelling the same identical offer to the ...

Sec. 36. Offers Implied In Fact; Contracts For Services: An offer need not be stated in words. Any conduct from which a reasonable person in the offeree's position would be justified in inferring a promise in return for a requested act or a requested promis...

Sec. 37. An Offer When Accepted Must Be Capable Of Creating A Definite Obligation: It is a necessary requirement in the nature of things that an agreement in order to be binding must be sufficiently definite to enable a court to fix an exact meaning upon it. If an offer contemplates...

Sec. 38. Offers And Agreements Indefinite As To Time: The promise contained in an offer may not specify exactly the time at which performance is to be made and may tract as soon as the plaintiff named the quantity which he wished to take. See also Minnea...

Sec. 39. Offers And Agreements Of Service Indefinite As To Time: In contracts of service when no time of employment is fixed by the express terms of the contract, the apparent intention of the parties may be sought as a question of fact provided any circumstances c...

Offers And Agreements Of Service Indefinite As To Time. Continued: 19 Ohio Cir. Ct. 663; Roddy 0. United Mine Workers, 41 Okl. 621,139 Pac 126; Christensen p. Pacific Coast Borax Co., 26 Or. 302, 38 Pac 127; Kirk 0. Hartman, 63 Pa. 97, 105; Coffin 0. Landis, 46 Pa. 4...

Sec. 40. Offers And Agreements Defining Incompletely The Time Of Performance: Frequently the nature of an offer or agreement or the surrounding circumstances will indicate sufficiently the time tention, that it contracted with reference to such known custom and usage. Whil...

Sec. 41. Offers And Agreements Indefinite As To Price: It is by no means uncommon for those who offer or agree to employ others, or to buy goods, to make no statement as to the wages or price to be paid. The law invokes here (as likewise where an agreemen...

Sec. 42. Offers And Agreements Indefinite As To Work Or Property To Be Given: As a promise may insufficiently specify the price to be paid, so the consideration for which the price is to be paid may be 53 Wall's Appeal, 111 Pa. 460, 5 Atl. 220, 56 Am. Rep. 288. 54 Bumey v...

Sec. 43. Offers And Agreements Where The Promisor Retains An Option: One of the commonest kind of promises too indefinite for legal enforcement is where the promisor retains an unlimited right to decide later the nature or extent of his performance. 77 Bumpus v. Bum...

Sec. 44. Offers And Agreements In Which The Promisee Is Given An Option. An Unlimited Option Given To The Promisee Is Theoretically Not: 7 Yelie Motor Car Co. v. Kopmeier Motor Co., 194 Fed. 324; Ellis v. Dodge, 237 Fed. 860. See also cases cited infra, Sec. 55, n., and Toledo Computing Scale Co. . Stephens, 96 Ark. 606, 132 S. W. 926....

Offers And Agreements In Which The Promisee Is Given An Option. An Unlimited Option Given To The Promisee Is Theoretically Not. Continued: (Tex. Civ. App.), 169 S. W. 906 (sale of automobile); Rossiter v. Cooper, 23 Vt. 622 (contract for labor); McClure s. Briggs, 68 Vt. 82, 2 Atl 583, 56 Am. Rep. 557 (sale of organ); Taturn v. Grist, 46...

Sec. 46. Miscellaneous Indefinite Promises: Other illustrations of promises too indefinite for legal enforcement may be suggested. A promise by a physician to remove if he fails to obtain an appointment or the field is not larger then than now...

Miscellaneous Indefinite Promises. Continued: 50 A contract to sell boles of cotton of average weight as specified basis 4's reweighed and f.o.b. cam, the difference for the grades above and below to be settled at the time of delivery, is suffic...

Chapter IV. Duration And Termination Of Offers: How offers may be terminated......................................... 50 Rejection by the offeree.............................................. 61 ...

Sec. 60. How Offers May Be Terminated: It seems formerly to have been supposed that an offer must be accepted instantaneously, or that it ceased to exist.1 This idea was doubtless based on the theory that the offer was only important as ev...

Sec. 51. Rejection By The Offeree: When an offer has been rejected it ceases to exist and cannot thereafter be accepted even though the acceptance is made within a time which would have been sufficiently early had there been no rejecti...

Sec. 51a. Acceptance To Take Effect In The Future: A nice distinction may be taken here between (1) a so-called acceptance by which the acceptor agrees to become immediately bound oil a condition not named in the offer, and (2) an acceptance which ado...

Sec. 62. When Rejection By Mail Takes Effect: When a rejection sent by mail takes effect is a question that does not seem to have been yet authoritatively decided. If such a rejection does not become effective until it reaches the offeror, a subs...

Sec. 63. Expiration Of Time Stated In The Offer: As the offeror is at liberty to make no offer at all he is also at liberty to dictate whatever terms he sees fit if he chooses to make an offer. Among his requirements may be accept-ence within a spec...

Sec. 64. Expiration Of A Reasonable Time: If no time is fixed in the offer within which acceptance must be made, it is a rule of law that acceptance must be within a reasonable time. What amounts to a reasonable time, however, varies within w...

Sec. 56. Revocation: It is a consequence of the rule that unsealed promises without consideration are not binding, that offers unless under seal or given for consideration may be revoked at any time prior to the creation ...

Sec. 56. Revocation Is Not Effectual Until Communicated: If the formation of a simple contract depended upon the existence of mutual assent in fact in the minds of the contracting parties, a change of mind on the part of either one before the requisite mutu...

Sec. 67. Indirect Communication Of Revocation: It is not yet perhaps fully settled whether an offer is revoked by knowledge on the part of an acceptor that the offeror is no longer willing to enter into such a contract as was proposed by his offer...

Sec. 59. Revocation Of General Offer: The requirement that a revocation must be received in order to be effectual creates difficulty where an offer has been extended to a large and indefinite class of persons, as an offer of reward issued...

Sec. 60. Revocation Of Offers For Unilateral Contracts: It seems impossible on theory sueessfully to question the power of one who offers to enter into a unilateral contract to withdraw his offer at any time until performance has been completed by the offe...

Sec. 60a. Attempted Solutions Of The Difficulty: The same problem exists in the civil law and has been met in modern codes by enacting that the offer is irrevocable until the offeree has had a reasonable time for performance.73 property, and a commi...

Sec. 61. When Offers Are Irrevocable: Every offer, as has already been seen, is a promise.85 It follows that if a seal is put upon an offer, it becomes a binding promise.86 The promise is, of course, conditional and until the performance ...

When Offers Are Irrevocable. Continued: 3 L. R. A. 94; Tibbs v. Zirkle, 55 W. Va. 49, 46 S. E. 701,104 Am. St. Rep. 977; Reuse v. Kittle, 56 W. Va. 269, 49 8. E. 150; Pyle p. Henderson, 65 W. Va. 39,63 S. E. 762; Peterson v. Cham, 115 Wis. ...

Sec. 62. Termination Of Offers By Death Or Insanity: If the formation of a contract required mutual mental assent of the parties, and offer and acceptance were merely evidence of such assent, it would be obviously impossible that a contract should be fo...

Sec. 63. Effect Of Delay In The Delivery Of The Offer: It occasionly happens that an offer is not delivered to the offeree until a later time than might have been expected by the offeror. The delay may even be so great that at the time the offer is first ...

Chapter V. Acceptance Of Offers: Necessity of acceptance.............................................. 64 Difference between acceptance in unilateral and bilateral contracts........ ...

Sec. 65. Difference Between Acceptance In Unilateral And Bilateral Contracts: An offer for a unilateral contract generally requires an act on the part of the offeree to make a binding contract. This act is consideration for the promise contained in the offer and doing it with i...

Sec. 66. Intention To Accept Is Unimportant Except As Expressed: It is not infrequently said that the offeree must intend to accept. If formation of simple contracts depends upon actual intention, this is true. If, however, as seems to be the case, the formation of...

Sec. 67. An Intention Not To Accept May Prevent The Formation Of A Contract, Where Words Or Acts Are Ambiguous: Though if an offeree of a bilateral contract should say I accept the offer, he would not thereafter be allowed to say that his words were not an acceptance because he did not really intend to accept...

Sec. 68. Acceptance Of Unilateral Contracts Where The Offeree Is The Promisor, Needs No Communication: It is often said that notice of acceptance is necessary for the completion of a contract, but it is not true and never has been true as a general proposition that where an offerer requests an act in...

Sec. 69. Communication May Be Necessary To Acceptance Of Unilateral Contracts When The Act Requested Is Peculiarly Within The Knowledge Of The Promisee; Guaranties: Though ordinarily the offeror in a unilateral contract can find out for himself whether the act which he has requested has been done, in some cases the act is of such a character that the offeror cann...

Sec. 69a. True Reason For Requiring Notice Of Acceptance Of Guaranty: If a bilateral contract were requested it would follow not only that notice of acceptance would be necessary to bind the guarantor, but also that after such notice, the person guaranteed would be boun...

Sec. 70. Acceptance In Bilateral Contracts Requires Communication: As has been seen the acceptance of a bilateral contract is not only an expression of assent to the proposition but is a giving of the counter promise requested. To complete a contract, the offeror mus...

Sec. 72. Acceptance Must Be Unequivocal: An acceptance must be positive and unambiguous. This requirement is often treated as identical with the requirement dealt with in the following sections that an acceptance must not change, add to or q...

Sec. 73. Acceptance Must Comply With The Terras Of The Offer: In order to make a bargain it is necessary that the acceptor shall give in return for the offeror's promise exactly the consideration which the offeror requests. If an act is requested, that very act ...

Sec. 74. Illustrations In Cases Of Offered Rewards: The principle stated in the preceding section finds frequent application in attempted acceptance of offers of reward. Thus where a reward was offered for the apprehension of John H. Surratt, one who...

Sec. 76. Illustrations In Other Cases Than Offers Of Reward: The same principle may find application in any form of contract. Especially is it to be observed that where an offeror requests a promise in return for his offer, the incurring of a detriment by begin...

Illustrations In Other Cases Than Offers Of Reward. Continued: 60 Horne v. Niver, 168 Mass. 4, 46 N. E. 393. Sec. 77. Qualified or conditional acceptances are counter-offers and reject the original offer. A conditional acceptance is in effect a statement that ...

Sec. 78. Conditions In An Acceptance Which Do Not Qualify In Legal Effect The Offer, Do Not Impair The Acceptance: Sometimes an acceptor from abundance of caution inserts a condition in his acceptance which merely expresses what 73 Gilbert v. Baxter, 71 Iowa, 327, 32 N. W. 364; Northwestern Iron Co. v. Meade, 2...

Sec. 79. Added Terms Requested As A Favor Do Not Invalidate An Acceptance: Frequently an offeree while making a positive acceptance of the offer, adds as a request or suggestion that some addition or modification be made. So long as it is clear that the meaning of the accept...

Sec. 80. An Offer Can Be Accepted Only By The Person Or Persons To Whom It Is Made: One of the necessary terms of any proposed contract is the person with whom the contract is to be made. Accordingly an offer made to one person cannot be accepted by another, even though the offeree p...

An Offer Can Be Accepted Only By The Person Or Persons To Whom It Is Made. Continued: 1124. See also Concord Coal Co. v. Form, 71 N. H. 33, 36, 61 Atl 283, 93 Am. St. 496. 96 Adams v. Lindsell, 1 B. & Ald. 681. 97Dunlopp. Higgins 1H. L.C.381; Household Fire Ins. Co. v. Grant, 4 ...

Sec. 82. Acceptance In Contracts By Telegraph Or Telephone May Be Complete By Dispatching A Message: By analogy to the law governing contracts by mail, it is held that a contract by telegraph may be completed by delivering a telegraphic dispatch of acceptance for transmission at the receiving office ...

Sec. 83. The Use Of The Mail Or Telegraph Must Have Been Authorized In Order That A Contract Should Be Completed By Sending An Acceptance: The reason given in modern cases for the doctrine that a contract may be completed by mailing a letter of acceptance, or by dispatching a telegraphic acceptance, is that the use of the post-office or ...

Sec. 84. An Acceptance Must Be Properly Stamped And Addressed: It is obvious that authority to send an answer by mail must be limited to an acceptance properly addressed.15 And as the postal laws of the United States require entire or partial prepayment of postag...

Sec. 86. When An Acceptance Is Mailed: An acceptance is mailed within the meaning of the rule under consideration!, when it is put within the control of postal authorities authorized to receive it. Merely delivering an acceptance to a mess...

Sec. 87. An Acceptance Inadequate When Mailed May Become Valid When Received: If an acceptance is actually received by the offeror which complies with the terms of the offer, while the offer is still a letter once mailed can be withdrawn by the party who mailed it. When letters...

Sec. 88. The Offeror May Impose As A Condition Of His Offer That The Acceptance Be Received: It necessarily follows from the power of the offeror to dictate the conditions of the contract, and the way that it may be accepted, that he may require the letter or telegram of acceptance actually t...

Sec. 89. When A Letter Of Acceptance Or Of Revocation Is Received Within The Meaning Of The Law: If actual communication were necessary for the formation of a contract, or actual communication of the revocation of an offer necessary for its withdrawal, it would be immaterial that a letter of acce...

Sec. 90. Implication Of Assent And Counter-Promise: Assent may be indicated by acts as well as by words, and an expression which primarily indicates merely assent to receive a performance promised by the offeror may also justify an inference on the par...

Implication Of Assent And Counter-Promise. Continued: 43 American Automobile Co. v. Perkins, 83 Conn. 520, 77 Atl. 954; Cameron Coal Co. v. Universal Metal Co., 28 Okla. 615, 110 Pac 720. See also Bauman v. McManus, 75 Kans. 106, 89 Pac 15, 10 L. R. A. (...

Sec. 90a. Acceptance Of A Document Implies Assent To Its Terms: For the same reason, namely, that bis action naturally indicates assent, where an offeree signs a document though in ignorance of its contents, he is bound by its terms.52 Nor is signature necessary. ...

Sec. 90b. Acceptance Of Telegraph Blank, Bill Of Lading, Ticket Or Warehouse Receipt So One Who Writes A Telegraphic Message On A Blank, Offered: 56Sentney v. Hutchinson, etc., R. Co., 90 Kans. 610, 135 Pac. 678; Leonard v. Howard, 67 Or. 203, 135 Pac. 549; Branson v. Coffin, 108 Mass. 175, 186, 11 Am. Rep. 335; Martin v. Drinan, 128 Mass. 515;...

Acceptance Of Telegraph Blank, Bill Of Lading, Ticket Or Warehouse Receipt So One Who Writes A Telegraphic Message On A Blank, Offered. Continued: 63 Baker v. Michigan Southern, etc., R. Co., 42 111. 73; Illinois Central R. Co. v. Frankenberg, 54 111. 88, & Am. Sep. 92; American Merchants' Express Co. v. Schier, 55 111. 140. In Chicago & Northwe...

Sec. 90c Qualification Of Principles Of The Preceding Section: Many courts qualify the principle just stated by the further principle that if the terms of a document are not fairly legible, the acceptance of it does not involve assent to its terms unless they wer...

Sec. 90d. Printed Notices On Letter Heads, Catalogues Or Tags: The principle of acceptance by conduct may be involved not only when all the terms of a contract are contained in a writing, but also when it is sought to import into a contract a statement printed on...

Sec. 90e. Notices On Merchandise: Attempts have been made by manufacturers to apply this principle to sales of merchandise so as to bind any purchaser by some sort of contract. As between the original parties to a sale this seems poss...

Sec. 91. When Silence And Inaction May Amount To Assent: Generally speaking an offeree has a right to make no reply to offers, and his silence and inaction cannot be construed as an assent to the offer.84 But the relations between the parties may have be...

Sec. 91a. Silent Inaction With Intent To Accept: Even where there is no duty to speak, a line of argument, which has not been formally stated in the cases, may be advanced to indicate that mere silence though unaccompanied by any act, may amount to ...

Sec. 92. Waiver Of Defect In Acceptance: It has sometimes been suggested that a defect in an acceptance might be waived by the offeror.99 If what is meant by this is merely that the offeror may accept a counter-offer by the offeree, which...

Sec. 93. Late Acceptance: The principles stated in the last section find application where an acceptance is delayed beyond the time allowed by the offeror, or beyond a reasonable time allowed by law, if no time was fixed in th...

Sec. 94. Effect Of Misunderstanding Of Offer And Acceptance: It follows from the principle that expressed mutual assent rather than actual mental assent is the essential element in the formation of contracts,5 that a mistaken idea of one or both parties in rega...

Effect Of Misunderstanding Of Offer And Acceptance. Part 2: 12Sullivan v. Kuykendall, 82 Ky. 483, 489, 56 Am. Rep. 901. 13 Western Union Telegraph Co. v. Shotter, 71 Ga. 760; Western Union Telegraph Co. v. Flint River Lumber Co., 114 Ga. 576,40 S. E. 815, 8...

Effect Of Misunderstanding Of Offer And Acceptance. Part 3: But it has been argued that the substitution of one company for the other made no real difference; that the defendant had no reason to prefer one to the other; that it would as readily and as willingl...

Sec. 96a. A Writing Signed Without Negligence In Ignorance Of Its Nature Is Void: Though expression of assent and not actual assent creates a contract, a writing purporting to be a contract and not ambiguous in its language may be wholly void. If without negligence on his part, a s...

Sec. 96. Time Of Formation Of Contract: The suggestion has been made that the acceptance of an offer relates back to the time when the offer was made. The original basis for this suggestion seems to be found in cases decided prior to the re...

Sec. 97. Place Of Contract: If the acceptance is made immediately after the offer when the parties are together, no question can arise as to the place of the contract. The place where the parties are is the only possible place o...

Sec. 98. Estoppel To Deny The Elements Of A Contract: There is no reason to suppose that the ordinary principles of estoppel do not apply to the formation of contracts. If, therefore, either party misrepresents an element of fact essential for the existe...

Chapter VI. Consideration: History of the law of consideration.............. 99 Differing modern tests of consideration............. 100 Distinction betwee...

Sec. 99. History Of The Law Of Consideration: It is requisite in English and American law for the formation of a simple contract that legally sufficient consideration be given for the promise or promises therein. This doctrine finds no close anal...

Sec. 100. Differing Modern Tests Of Consideration: In view of the varying underlying bases of the legal rights which have been enforced in the action of assumpsit, it is not surprising that there is difficulty in reducing to one fixed standard the con...

Sec. 101. Distinction Between Actual Consideration And Valid Consideration: It is not everything requested or given in exchange for a promise which will make the promise enforceable. In other words, it is not everything which the parties agree upon as consideration which the ...

Sec. 102a. Technical Meaning Of Benefit And Detriment: Benefit and detriment have a technical meaning. Neither the benefit to the promisor nor the detriment to the promisee need be actual. It would be a detriment to the promisee, in a legal sense, if he,...

Sec. 103. Application To Bilateral Contracts Of The Definition Of Consideration In Unilateral Contracts: The earliest simple contracts recognized by the law were unilateral. The first recognition of bilateral contracts seems to have been about the end of the sixteenth century.30 When endeavoring to ap...

Sec. 103a. A Distinct Principle Is Necessary To Explain Bilateral Contracts: To avoid the difficulties just stated, it is necessary to state further that the act of exchanging the promises makes them enforceable which has been called one of the secret paradoxes of the Commo...

Sec. 103b. Ames's Theory Of Consideration: Though the technical requirements of the definition of consideration in unilateral contracts may be fulfilled by giving any promise in fact, it is obvious that a promise which assures the performance ...

Sec. 103c. Definitions Of Pollock And Leake: Since, then, it cannot be admitted that mutual promises are always sufficient consideration for one another, it becomes necessary to determine in what cases a promise is a sufficient consideration for...

Sec. 103d. Reasons For Preferring Leake's Definition: Unless it can be shown that the statements thus referred to are opposed to actual decisions, or at least that there are plainly inconsistent judicial statements in the books, these quotations must be ...

Sec. 103e. Promises Which Are Not Binding Are Insufficient Consideration. Whatever May Be The Character Of The Thing Promised, A Promise Will Be Of No Value Unless It Is Binding; And The Rule: 64 See Smith v. Algar, 1 B. & Ad. 603; Mascolo v. Montesanto, 61 Conn. 60, 23 Atl. 714, 29 Am. St. Rep. 170; and infra Sec. 135. 65 Bates v. Sandy, 27 111. App. 552; Herbert v. Mueller, 83 111. App...

Sec. 103f. Final Definition Of Valid Consideration In Bilateral Contracts: Before a final summary is attempted it should be observed that it is not essential in order that a promise shall be sufficient consideration that its performance will certainly prove detrimental to th...

Sec. 104. A Promise Which By Its Terms May Be Performed Without Detriment To The Promisor Or Benefit To The Promisee Is Insufficient Consideration: What have already been referred to as illusory promises are insufficient consideration.78 Such a promise is a promise merely in form. Even if recognized by law it would impose no obligation, since the...

Sec. 106. A Bilateral Agreement May Be Valid Though One Party May Avoid The Agreement Or Avoid Performance Of His Own Promise: A defence given by the law to one promisor in a bilateral agreement enabling him at his option to avoid the whole agreement will not prevent his promise from being sufficient consideration for the cou...

Sec. 106. An Insufficient Bilateral Agreement May Sometimes By Performance On One Side Become A Valid Unilateral Contract: As is shown elsewhere 1 each promise in a bilateral contract must be sufficient consideration for the other, or both promises are invalid. Accordingly if either promise is too indefinite for enforceme...

Sec. 107. Written As Well As Oral Promises Need Consideration: It was suggested in several cases in the latter part of the eighteenth century that the requirement of consideration was for the sake of evidence only, and that therefore written contracts needed no c...

Sec. 109. Agreements Under Seal Need No Consideration: At Common Law a sealed promise or covenant was binding by its own force.27 It is often said that such instruments are presumed to have consideration, or import consideration. This mode of statemen...

Sec. 110. Good Consideration And Valuable Consideration: Consideration not infrequently becomes important in executed transfers of property, especially in the law of fraudulent conveyances; and in such transfers courts of equity have recognized as a vital e...

Sec. 111. Consideration Distinguished From Motive: Though desire to obtain the consideration for a promise may be and ordinarily is, the motive inducing the promisor to enter into a contract, yet this is not essential nor, on the other hand, can any m...

Sec. 112. Consideration Distinguished From Condition: As has been seen 47 an offer is a conditional promise; that is, a promise to take effect only if the exchange demanded for it is given. But the promise in an offer may be subject to other conditions t...

Sec. 114. From Whom The Consideration Must Move: It is frequently laid down that consideration must move from the promisee, or plaintiff,53 and it is not infrequently supposed that this rule is the essential reason for objection to contracts for the...

Sec. 115. Adequacy Of Consideration: It is an elementary principle that the law will not enter into an inquiry as to the adequacy of the consideration. 64 This rule is almost as old as the law of consideration itself.65 Therefore anyth...

Sec. 116a. Recital Of Consideration In Sealed Instruments: Where a consideration of one dollar, or indeed any named consideration, would be valid if actually given, the question has been raised how far a recital of such consideration in a written instrument p...

Sec. 116b. Recital Of Consideration In Unsealed Written Agreements: Where unsealed written contracts have not been given by statute the incidents of specialties, the mere fact that an agreement is in writing should not give to it any incident which at common law was p...

Recital Of Consideration In Unsealed Written Agreements. Continued: 95 Lawrence v. McCalmot, 2 How. 428,452, 11 L. Ed. 326. 96 Davis p. Wells, 104 U. S. 159, 167, 26 L. Ed. 686. 97 Southern Bell Tel. & Tel. Co. v. Harris, 117 Ga. 1001, 44 S. E. 885; statement, f...

Sec. 116. Charitable Subscriptions: The very term charitable subscription indicates that the subscriber's promise is made as a gift and not in return for consideration. There is no bargain between the parties. Even if one were attempted...

Sec. 117. Subscriptions For Business Purposes: It is not uncommon for subscribers to contract for some business end either with one another or with a person or corporation to whom the subscriptions are payable. This means that the subscribers are ...

Sec. 118. Subscriptions To Stock In Corporations: Subscriptions to stock in corporations involve no different principles from other business subscriptions.. The subscriber promises his payment in return for the promise of the corporation to give him ...

Sec. 119. A Promise Contingent On An Unknown Past Event Is Valid Consideration: As has already been seen 34 a conditional promise may be sufficient consideration. The performance of such a promise does not necessarily involve a detriment since the condition upon which any action ...

Sec. 120. Payment Or Promise Of Payment Of A Debt Is Not Valid Consideration: Since a debtor incurs no legal detriment by paying part or all of what he owes, and a creditor obtains no legal benefit in receiving it, such a payment if made at the place where the debt is due in th...

Payment Or Promise Of Payment Of A Debt Is Not Valid Consideration. Part 2: 35 Kans. 464, 11 Pac. 421; Jones v. Ricketts, 7 Md. 108; Harriman v. Harriman, 12 Gray, 341; Riley v. Kershaw, 52 Mo. 224; Murphy v. Kastner, 50 N. J. Eq. 214, 24 Atl. 564; Galowitz v. Hendlin (App. T...

Payment Or Promise Of Payment Of A Debt Is Not Valid Consideration. Part 3: 49 Carlton v. Western, etc., R. Co., 81 Ga. 631, 7 S. E. 623. 50 Walston v. F. D. Calkins Co., 119 Iowa, 150, 93 N. W. 49. Otherwise by statute in Maine, Fuller v. Smith, 107 Me. 161, 77 Atl. 706. ...

Payment Or Promise Of Payment Of A Debt Is Not Valid Consideration. Part 4: 63San Juan v. St. John's Gas Co., 195 U. S. 610, 49 L. Ed. 299, 25 S. Ct. Rep. 108; Leeeon v. Anderson, 99 Mich. 247,58 N. W. 72, 41 Am. St. Rep. 597. Logically perhaps this principle would sustain an...

Sec. 183. Promise Of Payment Or Payment Of Part Of A Debt By One Joint Debtor As Consideration: It has been held in a number of cases that the note or promise of one joint debtor to pay the whole or part of a liquidated debt, is sufficient consideration to support an agreement by the creditor,72...

Sec. 124. Payment Of A Portion Of A Debt With Negotiable Instrument: Negotiable paper is for many purposes regarded as a chattel, something to which the law will no more affix a definite value than to a horse or a book. Therefore, the transfer by the debtor of a negoti...

Sec. 126. Payment Of Debt By A Third Person: Payment of a debt, or part of a debt, by one who does not owe it, is obviously a legal detriment to him, and a legal benefit to the creditor. Therefore a partial payment by such a person is sufficient...

Sec. 127. When Payment Of Principal In Fall Discharges Interest: also. Whether a payment of the principal of a liquidated debt after maturity discharges not only the principal but also any interest which may be due, depends on whether the interest is due by the ...

Sec. 129. Payment Of So Much Of An Unliquidated Or Disputed Claim As Is Admittedly Due, Is Valid Consideration: Not infrequently though a claim is unliquidated, or the subject of a bona fide and reasonable dispute, it is conceded that at least a certain amount is due. It might seem that in paying this conceded ...

Sec. 130a. Unsoundness Of Arguments Sustaining Such Agreements: Two arguments have been advanced in support of the latter new, First, it has been said that the parties to the first aereement had either of them a right to subject himself to liability in damages if ...

Unsoundness Of Arguments Sustaining Such Agreements. Part 2: Packing Co. v. Lewis C. Troughton, Inc., 90 Wash. 196,155 Pac. 758. 14 This reasoning was adopted in- Lattimore v. Hansen, 14 Johns. 330. Mr. Justice Holmes, in his early book, The Common Law, p. 2...

Unsoundness Of Arguments Sustaining Such Agreements. Part 3: (unilateral, but dictum that a bilateral contract also would be invalid); Putnam v. Woodbury, 68 Me. 58 (uncertain whether unilateral or bilateral); Northwestern Nat. Bank v. Great Falls Opera House, ...

Unsoundness Of Arguments Sustaining Such Agreements. Part 4: In Donnelly v. Newbold, 94 Md. 220, 222, 50 Atl. 513, the same argument is used. The fact which appears on the face of the guaranty that the appellee was interested in the land which was to be improv...

Unsoundness Of Arguments Sustaining Such Agreements. Part 5: 36 Thus if A promise B to pay, next week, Sec.10 which A already owed at the time of the promise in return for a promise by B, it is dear, under the authorities, that no valid contract has been formed...

Sec. 132. Performance Or Promise Of A Performance Of A Duty Imposed By Law Is Not Valid Consideration: If a promisee is already bound by official duty to render a service, it is no detriment to him, and no benefit to the promisor, beyond what the law requires the promisee to suffer or to give, for him ...

Performance Or Promise Of A Performance Of A Duty Imposed By Law Is Not Valid Consideration. Continued: 113 Minn. 181, 129 N. W. 134; Smith v. Vernon County, 188 Mo. 501, 87 S. W. 949, 70 L. R, A. 59; Gregg v. Pierce, 53 Barb. 387; McCandless v. Allegheny, etc., Co., 152 Pa. 139, 25 Atl. 579; Texas Cott...

Sec. 134. Consideration Void In Part: It is no objection to the sufficiency of consideration that much of what was requested and given as such would be insufficient to support a contract. If a legal detriment to the promisee or benefit to...

Consideration Void In Part. Part 2: 73 Barnard v, Simons, I Roue's Abr. 26, pl. 39, Loyd v. Lee, 1 Strange, 94; Jones v. Ashburnham, 4 East, 455. Other early decisions holding forbearance of a groundless claim insufficient consideration...

Consideration Void In Part. Part 3: 78Union Bank v. Geary, 5 Pet. 99, 9 L. Ed. 60; Sheppey v. Stevens, 185 Fed. 147; Mason v. Wilson, 43 Ark. 172, 177; Kress v. Moscow-its, 105 Ark. 638, 152 S. W. 298; B. & W. Engineering Co. v. Beam, 2...

Sec. 136. Construction Of Agreements To Forbear: Sometimes in agreements to forbear, a fixed period for forbearance is stated, and sometimes perpetual forbearance or compromise of a claim is agreed upon. Occasionally, however, the agreement simply p...

Sec. 137. Assignment Of A Supposed Right As Consideration: Somewhat analogous to the surrender of a supposed claim as consideration for a promise, is the assignment of a supposed right of another kind. Certainly if the parties confessedly bargain for the assi...

Sec. 138. Gratuitous Undertakings: Among the early authorities on the action of assumpsit are cases of gratuitous undertakings.11 The gist of the action of assumpsit consisted in undertaking to do something and injuring the plaintiff b...

Sec. 139. Estoppel As A Substitute For Consideration: It is generally true that one who has led another to act in reasonable reliance on his representations of fact cannot afterwards in litigation between the two deny the truth of the representations, an...

Estoppel As A Substitute For Consideration. Part 2: 23The doctrine of estoppel seems scarcely applicable. The representation relied on . . . was more like a contract or promise than the statement of an existing fact. Per Kay, L. J., Low v. Bouverie, ...

Estoppel As A Substitute For Consideration. Part 3: 34 Rerick v. Kern, 14 S. & R. 267. 35 Wynn v. Garland, 19 Ark. 23, 68 Am. Dec. 190 (cf. Plunkett v. Meredith, 72 Ark. 3, 77 S. W. 600); Miller v. Kern, 151 Cal. 785, 99 Pac. 179; Al-brecht v. Drake...

Sec. 140. Mutuality: It is often stated as if it were a requisite in the formation of contracts, that there must be mutuality.43 This form of statement is likely to cause confusion and however limited is at best an unnece...

Sec. 141. One Consideration May Support Several Promises: In many contracts there are more promises than one on a side. If each promise on one side is supported by a promise or performance allotted to it exclusively as its consideration, the contract is divi...

Sec. 142. Past Or Executed Consideration: The term, past consideration, or executed consideration, is self-contradictory. Consideration, by its very definition, must be given in exchange for the promise, or at least in reliance upon the promi...

Sec. 143. Promises To Pay Precedent Debts: According to modern notions there is almost always either a contract implied in fact or an express contract in any situation where the early common law recognized the creation of a debt; but such was ...

Promises To Pay Precedent Debts. Continued: Holt, 36; Woodward v. Aston, 2 Mod. 95; Arris v. Stukely, 2 Mod. 260; Jacob v. Allen, 1 Salk. 27; Lamina v. Dorrell, 2 Ld. Ray. 1216. See further Ames, Hist, of Assumpsit, 2 Harv. L. Rev. 64-68. 74...

Sec. 14s. Some Jurisdictions In The United States Deny Validity To A Promise In Consideration Of An Act Previously Requested: In the United States some jurisdictions, following the modingham, Cro. Eliz. 715; Bosden v. Thinne, Yelv. 40; Field v. Dale, 1 Rolle's Ab. 11, pl 8; Townsend v. Hunt, Cro. Car. 408; Oliversn v. Wood, ...

Sec. 146. Other Jurisdictions In The United States Allow Validity To A Promise In Consideration Of An Act Previously Requested: Probably more jurisdictions in the United States have followed the early English authorities which hold a promise enforceable if supported by past consideration rendered at the promisor's request than...

Sec. 147. Promises In Consideration Of Moral Obligation: About the middle of the eighteenth century the term moral obligation as a kind of past consideration giving validity to a subsequent promise to fulfil the obligation gained currency. This seems to hav...

Promises In Consideration Of Moral Obligation. Part 2: 10 In Leake on Contracts (6th ed.), 443, the author says: A doctrine formerly prevailed that an express promise moved by a previously existing moral obligation furnished sufficient consideration to c...

Promises In Consideration Of Moral Obligation. Part 3: 27 Pool v. Homer, 64 Md. 131, 20 Atl. 1036; Robinson v. Hurst, 78 Md. 59, 26 Atl. 956, 20 L. R. A. 761, 44 Am. St. Rep. 266. But see Linz v. Schuck, 106 Md. 220, 67 Atl. 286, 124 Am. St. Rep. 481, 11 ...

Sec. 161. Ratification By An Adult Of A Contract Made During Infancy: It is everywhere the rule of the common law that a promise by an adult to fulfil an obligation entered into during infancy makes the obligation binding, or (as perhaps the matter should more accuratel...

Sec. 152. What Amounts To Ratification: What action on the part of the former infant is requisite to deprive him of his privilege or is sufficient permanently to avoid his contract is elsewhere considered.45 It is enough here to observe tha...

Sec. 153. Admission Of Liability Or Part Payment Are Insufficient To Terminate The Right To Avoid An Obligation For Infancy: Such admission or part payment of a debt as is generally held sufficient to avoid the bar of the Statute of Limitations ought more clearly to determine the right of an infant to avoid an obligation, s...

Sec. 164. Ratification Of An Infant's Contract May Be Conditional Or Partial: A ratification may be conditional and, if so, on the happening of the condition, but not before, a liability will arise.50 It is also possible to ratify part of a unilateral liability incurred in infa...

Sec. 156. Promise By A Widow To Perform An Agreement Made During Coverture: At common law a married woman could not bind herself by contract.56 Any attempt to do so was absolutely void of legal effect. It was held, however, in England while the doctrine of moral consideration...

Sec. 157. Promise By A Discharged Surety: In some jurisdictions notice of acceptance of a guaranty is required.63 In such jurisdictions, if notice is not given, the guarantor, nevertheless, becomes liable, if he promises, in spite of failure ...

Promise By A Discharged Surety. Continued: Barkalow v. Johnson, 1 Harr. 397; Gleadening v. Canary, 5 Daly, 489; Meyer v. Hibsher, 47 N. Y. 265; Leary v. Miller, 61N. Y. 488; Rosa v. Hurd, 71 N. Y. 14, 27 Am. Rep. 1; Baer v. Hoffman, 150 N. Y. ...

Sec. 168. Promise By A Discharged Bankrupt: In England it was formerly held that a new promise was effectual to bind a discharged bankrupt.78 But in the English Bankruptcy Acts of 1849 and 1861, it was provided that such promises should not be ...

Sec. 169. Promise To Pay Debt Voluntarily Released: If a creditor voluntarily releases his debtor, it is nearly if not quite universally agreed that a new promise by the debtor is not binding without new consideration. Even courts which are disposed to...

Sec. 160. Promise To Pay Debt Barred By Statute Of Limitations- Early Law: It became settled not a great while after the allowance of the action of assumpsit to enforce a promise to pay an antecedent debt, that a new promise by the debtor to pay his debt whether then barred ...

Sec. 161. Any Admission Was At One Time Held Sufficient: Subsequently, under the lead of Lord Mansfield, this doctrine was carried so far that an admission of indebtedness was held necessarily to give rise to a new obligation even though the admission was a...

Sec. 162. Modern Rule As To Revival Of Indebtedness: In a recent English case Lord Justice Mellish said in words often quoted: There must be one of these three things to take the case out of the statute. Either there must be an acknowledgment of the de...

Sec. 163. A New Promise Or Acknowledgment Is Sufficient Whether Made Before Or After The Statute Has Already Run: A new promise made either before or after the statute has completely run extends the period of limitation for the statutory period.8 The same rule prevails almost universally in regard to acknowledgme...

Sec. 164. Necessity Of A Writing: Until 1829 no formal requisite for a new promise or acknowledgment of indebtedness was made by the law of England. In that year, however, Lord Tenterden's Act, so called, was passed,11 which required ...

Sec. 16s. The Indebtedness To Which A New Promise Or Acknowledgment Relates Must Be Certainly Defined: Under the general principle that no promise can be enforced unless its meaning can be ascertained,22 a new promise (whether express or implied from an acknowledgment) to pay a debt cannot be effectual...

Sec. 166. An Unqualified Acknowledgment Of A Debt Implies A Promise To Pay It: It is a somewhat artificial inference of fact that an unqualified admission of a debt necessarily implies, so far as the Statute of Limitations is concerned, a new promise to pay it. Though the contra...

Sec. 167. An Admission Of Indebtedness Though Implying No Promise To Pay Is Still Sufficient In Some Jurisdictions: In a few States the courts have construed local statutes as removing the defence of the statute from any defendant who has acknowledged the debt within the statutory period, though no willingness to p...

Sec. 169. Acknowledgment Coupled With Claim Of Set-Off Or Reduction: Frequently a debtor couples his admission of a debt with the assertion that he is entitled to set off a claim of his own against the debt. If the assertion is to the effect that the set-off will cance...

Sec. 170. An Unqualified Acknowledgment Made Under Circumstances Showing No Intention To Pay: As the force of an acknowledgment depends in most States upon the inference to be drawn from it of an intention to pay, 47 Cripps v. Davie, 12 M. & W. 159; In re River Steamer Co., L. R. 6 Ch. 822;...

Sec. 171. Illustrations Of Sufficient Acknowledgment: It was held in the following cases that the acknowledgment was sufficiently absolute to justify the inference of an implied new promise: Received of [the creditor] the sum of $700 at various times to...

Sec. 172. Illustrations Of Insufficient Acknowledgment: In the following cases the acknowledgments were held not sufficiently positive to justify the inference of a new implied promise:-A letter from the debtor in reply to a claim for $77.91 saying in subs...

Sec. 173. Giving Security Is An Effective Acknowledgment: The giving of a pledge or other security for a debt is such an acknowledgment of it as a still subsisting obligation as to imply a promise of payment.91 So far as concerns the implication of a new pro...

Sec. 169, To The Effect That An Admission Coupled With A Claim Of Set-Off Equal To The Creditor's Claim Will Not Revive A Debt. But See Partington V. Butcher: 6 Esp. 66; Stimis v. Stimis, 60 N. J. Eq. 313, 47 Atl. 20. 91 Russell v. LaRoque, 11 Ala. 352; Merrills v. Swift, 18 Conn. 257, 46 Am. Dec. 315; Maddoz v. Walker's Exr., 26 Ky. L. Rep. 124, 74 S. W...

Sec. 174. Partial Payment Amounts To An Acknowledgment: Partial payment of a debt is regarded as equivalent to an admission of the debt and, therefore, a new promise is implied therefrom. This doctrine was early established in England,66 and has continuous...

Sec. 17$. Partial Payment Must Be Voluntary: The payment must be voluntary to justify the inference of a new promise and therefore a partial payment collected on execution,15 or derived from foreclosure of a mortgage,16 or collected from rents a...

Sec. 176. Partial Payment Derived From Sale Of Collateral: Payments derived from the sale of collateral have given rise to some difference of decision. Doubtless if a payment is obtained from collateral by the creditor acting in invitum, there is no basis for...

Sec. 177. Partial Payment Need Not Be Made In Money: A payment to revive a debt need not be made in money; since the giving of any property, note or security as a partial payment, warrants the same inference as if payment had been made in cash.31 And so...

Sec. 178. Application Of Payments To Barred Debts: If a debtor owes several debts to bis creditor and when a payment is made gives no direction, as to its application, the creditor may apply it as partial payment of a debt barred by the Statute of Lim...

Sec. 179. Conditional Promises: It has already been said 39 that a conditional promise to pay a debt coupled with evidence that the condition has been performed, will revive the debt. It may be said more broadly, If the admission b...

Sec. 180. When A Conditional New Promise Needs Acceptance: A debtor may make an offer to compromise any claim against him, and a new conditional promise to pay a debt will be such an offer if some performance or promise is requested as the consideration or ex...

Sec. 181. New Promise To Pay A Debt In Part Or In Instalments: A promise to pay a specified part of a debt or to pay the debt in instalments or without interest or in any other way than that for which the debtor at the time stands bound, if made upon condition th...

Sec. 182. A New Promise To Pay When A Debtor Is Able, Or On Other Conditions: The effect of a promise to pay when able is of legal importance not simply with reference to debts barred by the Statute of Limitations, but in other cases. Such promises when supported by considerati...

Sec. 183. Promises Not To Plead The Statute Of Limitations: Either prior to the expiration of the statutory period or subsequently, a debtor may promise not to plead the Statute of Limitations. He may make such a promise for sufficient consideration, or he may...

Sec. 184. Promises Without Consideration Not To Plead The Statute Of Limitations: A promise not to plead the statute will generally on a fair construction imply a promise to pay the debt. If such a promise is fairly to be implied, the debt will be revived to the same extent as if t...

Sec. 186. Terms On Which A New Promise Revives A Debt: If the new promise whether express, or implied from an acknowledgment, is itself the cause of action, the indebtedness should be extended by such a promise for the period allowed by law for the enforc...

Sec. 186. A New Promise Cannot Revive Liability In Tort: As the remedy of assumpsit was extended to cover cases where originally debt would have been the appropriate remedy,79 and as no attempt was made to extend the remedy of assumpsit to promises express ...

Sec. 187. Whether A New Promise Can Revive A Liability On A Specialty: The early law never went so far as to hold that a subsequent promise to perform an obligation under seal could be enforced in the action of assumpsit. Even if the sealed instrument bound the maker to ...

Sec. 188. Whether A New Promise Can Revive An Unliquidated Contractual Obligation: It is frequently said that a new promise can revive a right of action in assumpsit, without distinguishing between indebitatus assumpsit on the one hand and special assumpsit to recover damages on the...

Sec. 189. To Whom A New Promise Must Be Made: It is generally held that a new promise to be effective must be made to the creditor himself or to his authorized agent.7 5Colledge v. Horn, 3 Bing. 119; Gardner v. M'Mahon, 3 Q. B. 561; Lechmere v...

Sec. 190. By Whom A New Promise May Be Made: On general principles a new promise either express or implied from an acknowledgment or part payment to be effective must be made by the debtor or by his authorized agent.20 A promise made by a strang...

Sec. 191. Few Promise Or Part Payment By A Joint Obligor: The question of whether one joint or joint and several obligor having no other authority than that necessarily involved in the joint relationship may bind his co-obligors by a new promise or partial p...

Sec. 192. New Promise Or Part Payment By A Partner: The power of a partner to bind his firm by a part payment or a new promise involves a different question from that involved in the case of ordinary joint contractors, and prior to dissolution of the p...

Sec. 193. Effect Of A New Promise Or Part Payment By A Principal Debtor Or A Surety Upon The Liability Of The Other: There has never been any real basis for supposing that a new promise or part payment by a principal debtor after his debt was barred could renew the liability of the surety unless the principal debtor...

Sec. 194. New Promise Or Part Payment Made By A Fiduciary: If the obligation due from a fiduciary arises not simply from the office which he holds but from a contract originally made by him, he is personally bound unless the contrary is expressly provided. Th...

Sec. 105. New Promise Or Part Payment Made By A Surety: In Kentucky it has been held that a gratuitous new promisee by a surety will not revive his liability.67 On historical grounds a forcible argument may be made for this distinction as to a surety. The ...

Sec. 196. Whether The Creditor Should Sue On The Original Indebtedness Or On The New Promise: There is great confusion in the authorities as to the manner in which the creditor should enforce his rights by action if it be assumed that such a new promise has been made as will entitle him to rec...

Sec. 197. New Promise After Action Brought: On principle there is a difference between the validity of a new promise made after action brought where the defence is infancy, and where the defence is the Statute of Limitations or bankruptcy, sinc...

Sec. 198. A New Promise Made On Sunday, Or By An Insolvent: If under the local law a contract cannot be made on Sunday, 84 See Duncan v. Dixon, 44 Ch. Div. 211, 213, also infra, {231. 85 Slator v. Trimble, 14 Irish C.L. 342; Beat v. Givens, 3 B. Mon. 72;...

Sec. 200. Ratification And Adoption: There are other classes of cases usually referred to the heads of ratification and adoption which in their essence involve the making of promises which are enforced by the law although supported by no...

Sec. 201. Explanation Of Anomalous Cases Where Transactions Are Enforced Without Present Consideration: Various attempts have been made to explain and to classify the cases where promisors are held liable without present consideration; and so far as possible to harmonize them with recognized principles....

Sec. 202. Revival Of Debts Barred By Some Positive Rule Of Law: The often quoted rule that debts which were once enforceable through the medium of an implied promise, and which have thereafter been barred by some positive rule of law, may be revived by a new promi...

Sec. 303. Waiver: It is often said that the new promise of a debtor whose debt is barred by the Statute of Limitations by a discharge in bankruptcy or other similar defence waives the defence by a new promise rather th...

Sec. 204. Defeasible Defences: It may be suggested, finally, as an explanation of the cases in question that the defence was from the outset defeasible in its nature; that is, that the law permitted the defendant to assert, within ...

Chapter VII. Formation Of Formal Contracts: Sealed instrments an old form of obligation................ 206 Requisites of a sealed contract..................... 208 What is...

Sec. 200. Sealed Instruments An Old Form Of Obligation: The contracts most completely based on form are those under seal, and the use of these was common long before the recognition of simple contracts.1 The obligation of the maker of a sealed instrumen...

Sec. 206. Requisites Of A Sealed Contract: It is said by Lord Coke 6 that a deed must be written on paper or parchment, but it may perhaps be doubted whether an instrument written or printed on any substance capable of receiving and retaining ...

Sec. 207. What Is A Seal: It is said by Lord Coke that a seal is wax on which an impression has been made, and that the wax without the impression would not constitute a seal.10 But the common law has everywhere in recent time...

Sec. 11740. A Scroll Or Device Used As A Seal Has The Same Effect As A Seal: New Jersey, Comp. Stat. (1911), pp. 1640, 3776. A scroll or other device is sufficient. New Mexico, Comp. Laws (1897), Sec. 3932. A scroll is sufficient. New York, Gen. Const. Law, Sec.44. A sea...

Sec. 208. Adoption Of A Seal: It was early established that the maker of a deed need not himself attach the seal.22 And one seal may serve for several persons. It was formerly thought necessary that each should make an impression ...

Sec. 210. Delivery: The final requisite for the validity of a deed is delivery. Until delivery it is ineffectual though signed, sealed, and assented to by the parties as an expression of the bargain between them; and whe...

Delivery. Continued: A deed may be unilateral or bilateral in its operation. In the former case it need be executed only by the obligor and is customarily called a deed poll. If the obligations are bilateral it would norm...

Sec. 212. Delivery In Escrow: The manual surrender of a sealed instrument to a third person does not necessarily create an immediate obligation. The instrument may be delivered in escrow.53 Acquisition by the grantee of the escrow...

Sec. 213. How Far Acceptance By The Obligee Is Necessary: The English law has never required an assent on the part of the obligee in order to make a deed binding.59 The obligee may decline to accept the estate or obligation conferred upon him by the deed, bu...

Sec. 214. Acceptance Of A Sealed Instrument Containing Promises By The Acceptor Does Not Bind Him As A Covenantor: It has already been seen 64 that assent to a contract may be inferred from the acceptance of a document which states that something is to be done by the person who accepts the document. On no principl...

Sec. 215. Requirements In Regard To The Obligee Of A Sealed Instrument: The common law made the technical rule that though a deed poll might create a covenantee who was not a party to the instrument (for indeed a deed poll would otherwise be an impossibility) yet in an in...

Sec. 217. A Covenant Needs No Consideration: As the law of covenants long antedates the law requiring consideration for the formation of contracts, it is necessarily true that, in the early law, no consideration in the modem sense was required t...

Sec. 218. Statutes Changing The Common Law Of Sealed Instruments: In many States the distinction between sealed and unsealed written contracts is in terms abolished. This is true in Alaska,78 Arizona,79 Arkansas,80 California,81 Idaho,82 Indiana,83 Iowa,84 Kansas,85...

Sec. 219. The Desirability Of Such Statutes: It is most unfortunate if no method be left in a system of law by which a confessedly voluntary promise may be binding. The seal at common law furnished such a means. It may be said that this means wa...

Sec. 221. Negotiable Instruments: Though negotiable instruments are ordinarily classed as simple contracts and undoubtedly partake to some extent of the nature of simple contracts, yet they are also formal contracts. It is necessary i...

Book II. Parties To Contracts. Chapter VIII. Capacity Of Parties. Infauts: Parties of limited capacity to contract .......................... 222 Early law as to the validity of an infant's contract................... 223 ...

Sec. 222. Parties Of Limited Capacity To Contract: The formation of contracts requires the existence of parties capable of contracting, but capacity of any person to contract is to be presumed unless he falls within one of the classes of persons who a...

Sec. 223. Early Law As To The Validity Of An Infant's Contract: The law governing agreements made during infancy is of considerable antiquity. In 1292 a decision is reported regarding a guardian's account.45 It was there said that a release by the infant would not...

Sec. 324. Who Is An Infant: The age of twenty-one has been fixed by the law for centuries as that at which either a man or woman is regarded by the law as acquiring full capacity52 No distinction generally has been drawn so far ...

Sec. 225. Emancipation Of An Infant: By the rule of the common law, the father of an infant was entitled to his services and therefore to his earnings,59 and generally it is held that a widowed mother succeeds to the father's rights in t...

Sec. 227. Contracts Of An Infant Which Have Been Held Void: Reference may be made to some of the contracts which have most frequently been held void when made by an infant. 77Sec.223. 78 Tucker v. Moreland, 10 Peters, 58, 60, 9 L. Ed. 345; United States ...

Sec. 228. Transactions Which Cannot Be Avoided By An Infant: A few obligations because of public policy or implications drawn from statutes are binding upon infante and cannot be disaffirmed. Though an infant may disaffirm an executory promise to marry,95 a mar...

Sec. 229. An Infant's Contract Of Partnership: As between himself and his co-partners, an infant's contract of partnership is, like all his other contracts, voidable. He may disaffirm the contract without being liable for damages,11 and such disaf...

Sec. 281. Voidable Means Valid Until Avoided: Most of the disputed questions in the law of infancy turn upon the legal meaning of the word voidable as applied to an infant's acts. The natural meaning of the word imports a valid act which may be...

Sec. 232. Infant's Privilege Is Personal: The right to avoid his contracts and conveyances is given an infant for his protection, and should not be stretched beyond what his needs require. Therefore, the right is confined to the infant himsel...

Sec. 23s. Whether The Privilege May He Exercised Against A Subsequent Purchaser In Good Faith: Though a transaction with an infant is merely voidable, it is unlike contracts voidable for fraud or other equitable ground in this respect; even a bona fide purchaser for value of property formerly b...

Sec. 234. How Disaffirmance May Be Made: Any act which clearly shows an intent to disaffirm a contract or sale is sufficient for the purpose. Thus a notice by the infant of his purpose to disaffirm,42 a resale of goods,43 a second conveyance...

Sec. 235. When The Privilege May Be Exercised: It was early settled that an infant's conveyance of realty can be avoided only after he has attained his majority, though it has been said that he may enter during his minority and receive the rents a...

Sec. 236. The Whole Transaction Must Be Disaffirmed: An infant cannot disaffirm so much of a transaction as is unfavorable to him and treat the remainder as effectual. If he disaffirms his obligation to pay an agreed price, he thereby necessarily disaff...

Sec. 237. Other Consequences Of Disaffirmance: When an infant exercises his privilege and rescinds a sale of personal property made to or by him, the title and rights of the parties in the goods are restored to the original status, as if no sale h...

Sec. 238. Restoration Of Consideration: From what has been said it is evident that if an infant has received consideration for a transfer of money or goods by him, and still has that consideration, he cannot disaffirm his transfer without v...

Restoration Of Consideration. Continued: 72 Insterstate Coal Co. v. Trivett, 155 Ky. 825, 160 S. W. 728; Barr v. Packard Motor Car Co., 172 Mich. 299, 137 N. W. 697; Britton v. South Penn. Oil Co., 73 W. Va. 792, 81 S. E. 525 In Gonackey v. ...

Sec. 239. Ratification: If, as has been previously suggested, an infant's contract is valid until avoided, ratification does not, strictly speaking, create a right against the infant, but merely terminates the privilege whic...

Sec. 240. Liability For Necessaries: It is well settled that an infant may make himself liable for goods that are necessary, considering his position and station in life. This liability, though often treated as arising from the promise o...

Sec. 241. What Are Necessaries: It depends upon the facts in each case whether goods or services contracted for by an infant are necessary. Illustrations may be given of what kinds of goods have been held necessary or the reverse, b...

Sec. 242. What Are Not Necessaries: Under ordinary circumstances the purchase of a house is not necessary,25 nor work and materials for the building of a house,26 nor fire insurance,27 nor life insurance.28 Clothing course in stenog...

Sec. 243. Money Advanced For The Purchase Of Necessaries: It was ruled by Buller, J., at Nisi Prius in 1783 that money lent, though lent for the express purpose of enabling an infant to purchase necessaries, and actually expended in accordance 41 Mclssaac...

Sec. 244, Previous Supply: What are necessaries is determined not simply by the nature of the thing, but by the need of that thing at that time by the particular infant in question. Accordingly if an infant is already supplied ...

Sec. 246. False Representations Of Age: It is everywhere agreed that the fact that an infant was trading as an adult or otherwise appeared to be of age, and that the other party contracted with him on the belief that he was an adult, does n...

Sec. 216. Other False Representations: Even more difficult questions have arisen in regard to other false statements of infante-especially warranties of quality or title. The action upon a warranty is older than the action of assumpsit, de...

Sec. 247. Infants' Agency To Bind Parent: The relation of parent and child does not of itself give any authority to the child to bind the parent.87 In contracts other than those for the purchase of necessaries the liability of a parent on con...

Sec. 218. Actions By And Against Infants: An infant cannot personally prosecute an action in court. An action on his behalf must be brought either by his guardian or by a next friend.95 It is a good plea in abatement that a plaintiff who sues...

Chapter IX. Capacity Of Parties. Insane And Intoxicated Persons: Insane persons; early law..................... 249 Lunatics' transactions void.............................. 250 Lunatics' trans...

Sec. 249. Insane Persons; Early Law: Lord Coke laid down the rule that a lunatic could not be permitted by plea to show the invalidity of his acts because to do so would be to stultify himself.1 This reasoning would probably prevail nowh...

Sec. 260. Lunatics' Transactions Void: It seems a natural consequence of lunacy that any transaction which requires actual mutual assent cannot be effectually made by a lunatic. As was said in a decision of the Supreme Court of the United ...

Sec. 261. Lunatics' Transactions Voidable: According to the view more commonly expressed, a lunatic's transactions are voidable. An analogy with infant's contracts, confessedly not perfect, inasmuch as an infant may be, in fact, mentally compe...

Sec. 262. Voidable Against Bona Fide Purchaser: Though a lunatic's contracts are regarded as voidable only, they may at common law, if voidable at all, be avoided against a subsequent purchaser who paid value for the property which was originally s...

Sec. 263. Ratification And Disaffirmance: If a lunatic's contracts are voidable only, they may be ratified and the authorities almost uniformly support the validity of such ratification if the lunatic was not under guardianship.23 Any conduct...

Sec. 254. Lunatics' Contracts Valid In Some Cases: In comparatively recent times many courts have made a still farther departure from the view that a lunatic's contract is void because of his inability to give intelligent assent. In the leading case o...

Sec. 255. Necessaries: For the same reason as in the case of infants, lunatics are liable for necessaries furnished them.61 As pointed out62 under the heading of infancy, this liability should be regarded as quasi-contractu...

Sec. 266. What Constitutes Insanity. In The Early Decisions Little Distinction Is Made Between: 64Creagh v. Tunstall, 98 Ala. 249, 12 So. 713; Merwin's App., 72 Conn. 167, 172, 43 Atl- 1055, 1057; Sawyer v. Luflrin, 56 Me. 308; Darby v. Cabanne, 1 Mo. App. 126; Stannard v. Bums, 63 Vt. 244, 22 A...

Sec. 267. During Guardianship Lunatics' Bargains Are Void: In the discussion thus far it has been assumed that the lunatic was not under guardianship. When a guardian is appointed he thereupon becomes vested with the control of the property of his ward, and h...

Sec. 258. Drunkenness-When It Incapacitates: It is not every degree of intoxication that renders a person incapable in a legal sense. In order to make out incapacity it is necessary to prove that a man was so far intoxicated moral of the guardia...

Sec. 269. Drunkards' Bargains Voidable: If intoxication is so extreme as to produce legal incapacity, the effect is generally held to be the same as that of insanity; consequently, a contract or sale made under such circumstances is voidabl...

Sec. 260. Effects Of Drunkards' Bargains: If a bargain is voidable on the ground of intoxication, the same consequences follow as in the case of a bargain voidable for insanity. The transaction may, therefore, be ratified.91 What constitutes ...

Sec. 263. Fraud Upon Intoxicated Persons: Bargains made with intoxicated persons are peculiarly likely to have been induced by fraud. No different legal principle covers such cases from that applicable to all cases of fraud, but in view of th...

Chapter X. Capacity Of Pasties. Married Women, Corporations: Married women...................... 264 Rights and liabilities under contracts......................... 265 Effects of attempted...

Sec. 266. Rights And Liabilities Under Contracts: A married woman, during the life of her husband could not bind herself by a contract,1 nor by representing herself as unmarried or a widow, render herself by estoppel liable on an agreement.2 If she w...

Sec. 266. Effects Of Attempted Transfers: As the chattels a woman had upon her marriage immediately passed to her husband, she was obviously incapacited from transferring such property even aside from her inability to make a valid bargain, be...

Sec. 267. Modifications In Equity: The almost total denial of property rights to a married woman under the common-law system was modified in equity by the doctrine of separate estate. Originally this was given effect by conveying to tr...

Sec. 268. Modern Statutes: In England the Married Woman's Property Act of 1882 greatly extended the rights of married woman. In the United States there are statutes in nearly if not quite all the States extending or changing th...

Sec. 269. American Statutory Modifications Of The Common Law Relating To The Contractual Capacity Of Married Women: Alabama. A married woman has generally full contractual capacity, and a husband and wife may contract with one another, but a wife cannot either directly or indirectly contract as surety for her husba...

Sec. 270. Agency Of Wife For Husband: Even at common law in early times it was recognized that the wife might be the agent of the husband and, as such, bind him by contracts and purchases. She herself incurred no liability even as a warra...

Sec. 271. Corporations: Corporations derive their power from the government which creates them, and if they act beyond the limits of power given them by that government, their acts are at least unwarranted by law and, accord...

Chapter XI. Contracts Of Agents And Fiduciaries: Scope of chapter........................ 273 Appointment of agents may generally be informal....................... 274 Authorit...

Sec. 274. Appointment Of Agents May Generally Be Informal: In general no formality is necessary for the appointment of an agent to contract on behalf of his principal. Authority may be given by expression of assent thereto in any way. Frequently the principal...

Sec. 275. Authority To Enter Into A Sealed Contract Must Be Under Seal: The only exception made by the common law to the possibility of creating an agency informally, relates to sealed contracts. Authority to enter into written contracts for the sale of land may be oral;2...

Sec. 276. In Some States Authority For Certain Acts Is Required To Be In Writing: In a number of States, by statute or otherwise, authority to execute contracts for the sale of land must be in writing, though such contracts need not be sealed.18 And where the authority is required ...

Sec. 277. Apparent Authority And Estoppel: An agent may be able to make contracts which will bind his principal not only when actually authorized by express words or implication of fact to do so but also in cases where the principal did not in...

Sec. 378. Ratification: Subsequent ratification by a principal of a contract made on his behalf by one who had at the time neither actual nor apparent authority, is as effectual as original authorization. Not only is a contr...

Sec. 279. Termination Of Agent's Authority: An agent's authority may be terminated in various ways. The authority may itself fix its limits or may contain conditions which, when they come into effect, automatically end it. But an agency may be ...

Sec. 280. When An Agent's Authority Is Irrevocable: When the power of an agent is coupled with an interest it is irrevocable. The meaning of the words coupled with an interest has not been very accurately defined. They certainly mean something more t...

Sec. 381. Contracts Made By An Agent In His Principal's Name Are Contracts Of The Principal: If an agent is acting within the scope of his actual or apparent authority, and purports to enter into a contract on behalf of the principal it is fundamental that the contract is that of the principa...

Sec. 282. Agent's Liability When The Principal Though Disclosed Is Not Bound: In some cases even though both parties attempted to bind a disclosed principal, they fail to do so because the principal had no capacity to contract, or was non-existent at the time. On general princi...

Sec. 283. Different Situations Where The Principal Is Undisclosed: Frequently one who is in fact an agent enters into a contract without naming his principal. He may either fail entirely to disclose that he is an agent, or he may disclose that he is an agent, but fai...

Sec. 284. Rights And Liabilities Of The Agent Where The Agency Is Undisclosed: If it is not disclosed that the agent is acting as such it is evident that the person dealing with him must necessarily have supposed he was a principal and as apparent not actual mutual assent is eff...

Sec. 285. Rights And Liabilities Of An Agent Who Discloses Bis Agency But Does Not Name Bis Principal: .It Is Not Infrequently Laid Down Broadly That If An Agent Discloses the fact that he is an agent, but not the name of his principal, he is personally liable.86 This, however, cannot be literally true...

Sec. 286. Rights And Liabilities Of The Principal Where The Agency Is Undisclosed: Though it was not disclosed at the time of the bargain that the agent was acting for any principal, the principal is nevertheless liable,98 if the contract was not under seal or in the form of a negot...

Rights And Liabilities Of The Principal Where The Agency Is Undisclosed. Continued: App. D. 715, 164 N. Y. S. 912; Thayer v Luce, 22 Ohio St. 62, 78; Houghton v. J. W. Hundley Co. (Okl.), 157 Pac. 1142; Levy v. Nevada-California-Oregon Ry., 81 Oreg. 673, 160 Pac. 808; Hubbert v. Bord...

Sec. 287. Rights And Liabilities Of The Principal Where The Agency: is disclosed but the principal not named. Where, in making an informal contract, the fact of agency was disclosed but no principal was named, the principal is liable;22 even though the plaintiff wh...

Sec. 288. What Is Sufficient Disclosure Of The Principal: As different rules of law are applicable when the agent discloses his principal and when he does not, the question of what is a sufficient disclosure of the principal is an important one. It is said t...

Sec. 291. Defences To Actions By An Undisclosed Principal: As the doctrine by which an undisclosed principal is given rights and subjected to liabilities under a contract made professedly with another is somewhat artificial, and is adopted for the promotion o...

Sec. 292. Defences To Actions Against An Undisclosed Principal: There is considerable confusion of authority in regard to the question whether settlement by the principal with his agent before the person with whom the agent dealt makes a claim upon the principal i...

Sec. 293. Defences To Actions By The Agent Of An Undisclosed Principal: If the agent sues the person with whom he dealt it is a defence that settlement has been made with the principal though he was wholly undisclosed at the time of the contract.58 Whether a claim that co...

Sec. 295. Informal Written Contracts: The principles which have heretofore been referred to, are applicable not only to oral contracts but also in the main to unsealed written contracts. Some important consequences, however, flow from the...

Sec. 296. Sealed Contracts: In view of the right of action by or against the principal which exists even though the agent is named as the contracting party in the writing, it is only where the agent seeks to maintain a personal ...

Sec. 297. When Simple Contracts Binding The Principal May Be Implied: If the principal takes the benefit of a covenant made in fact on his behalf, but so written that the covenant is not that of the agent because the promise is not expressed to be his, nor that of the p...

Sec. 298. Only Parties To Negotiable Instruments Are Liable Thereon: A bill of exchange or promissory note is a formal instrument though of a mercantile character, and it is generally held that no one is liable on such an instrument whose name does not appear upon it a...

Sec. 299. What Signatures To Negotable Instruments Bind The Principal: The signature by the agent of the principal's name alone is sufficient to bind the principal if the agent was duly authorized.91 So a signature of the agent stated to be on account of the principal,...

What Signatures To Negotable Instruments Bind The Principal. Continued: Universal Church of Pierceton); Hayes v. Matthews, 63 Ind. 412, 30 Am. Rep. 226 (Trustees of the First Universalist Church of Pierceton, Indiana,); Hayes v. Brubaker, 65 Ind. 27 (Trustees of the F...

Sec. 300. Adoption By A Principal Or A Corporation Of The Signature Of An Agent Or Officer: As a party to a negotiable instrument may adopt as a business destination any name which he sees fit,3 as indeed a party to any contract may,4 it has been urged with some force that under this rule th...

Sec. 302. Reformation Of Instrument And Admission Of Parol Evidence: If it can be shown clearly that both parties intended that the principal and the principal only should be bound, a bill in equity may be maintained to reform a contract expressed in such a way as to b...

Sec. 303. A Principal Not Liable On A Negotiable Instrument May Be Liable On Its Dishonor: The principal though he is not liable, whether disclosed or not, upon a negotiable instrument signed by his agent personally, may nevertheless be liable as a debtor for the price or the value of any c...

Sec. 305. Public Agents: The general principles governing an agent's liability for contracts made on behalf of his principal are subject to an exception in the case of public agents. It is a rule of presumption that a contrac...

Sec. 307. Unincorporated Associations: Numerous societies exist composed of a large and changing membership which are not incorporated. Within this class are clubs for social purposes, charitable and political societies, and also associati...

Sec. 308. Unincorporated Associations Which Are Not Partnerships: Associations which do not conduct business for the purposes of profit are not partnerships but their members become liable for obligations incurred in behalf of the association within the scope of the...

Sec. 309. Procedure In Enforcing Rights And Liabilities Of Unincorporated Associations: The difficulty of procedure in actions by or against the members of an unincorporated association where the members are numerous, has led to the enactment in England, and some of the United States, of...

Procedure In Enforcing Rights And Liabilities Of Unincorporated Associations. Continued: 61Lyman v. National Bank of the Republic, 181 Mass. 437, 438, 63 N. E. 923, and see cases in the following 62 In re Johnson, 15 Ch. D. 648; Dowse v. Gorton, [1891] A. C. 190; Foxworth v. White, 72 ...

Sec. 312. Trustees Are Liable Personally On Their Contracts: The contracts of trustees even more clearly than those of executors must bind the fiduciary personally if binding as contracts at all. The Common Law at least recognized the possibility of a judgment ...

Sec. 313. Enforcement Of Claims Against The Trust Estate: If the trustee's insolvency or other cause prevents one who has contracted with a trustee with reference to the trust business from obtaining adequate relief by an action at law against the trustee, a...

Sec. 311. Guardians: The rules applicable to guardians of minors or lunatics are similar to those governing contracts of trustees. The guardian is bound individually by his contracts on behalf of the estate.99 Nor does it...

Sec. 315. Receivers: A receiver is an officer appointed by the court to take possession but not the title of property pending further proceedings involving it.5 Unless authorized by the court so to do, a receiver is not j...

Chapter XII. Joint Duties And Rights Under Contracts: Nature of joint duties.......................... 316 Nature of joint rights......................................... 317 Antiqui...

Sec. 316. Nature Of Joint Duties: The primary conception of a joint duty or obligation under a contract is that two or more persons are together bound as if they were a single person. This conception is possible in reasoning concernin...

Sec. 317. Nature Of Joint Rights: In an entirely analogous way several persons, who are promisees under a contract, may be treated as a unit and, thereby, together become entitled to the performance of the promise. In case of joint...

Sec. 319. Joint Obligations In The Civil Law: The Roman law, like the common law, recognized the possibility of a community of obligations for the payment of the same debt, but the lines of distinction drawn in the Roman law are not the same as t...

Sec. 320. Obligors May Be Bound Jointly And Severally: Where several persons bind themselves for the same performance, they may not only bind themselves either jointly or each one separately, but also they may bind themselves jointly and at the same time ...

Sec. 321. Obligees May Not Be Entitled Jointly And Severally: It was decided in Slingsby's case16 that joint and several rights could not be created under a contract; and this principle has been regarded as settled ever since that decision,17 though there are no...

Sec. 322. When Obligors Are Bound Jointly: Following the analogy of the rule of real property that an estate granted to two persons created a joint tenancy rather than a tenancy in common, it was early held and, except as changed by statute,20...

Sec. 323. When Obligors Are Bound Severally: It is wholly a question of construction whether each of several obligors makes a separate promise or whether they unitedly make a joint promise. This rule of construction is subject, however, to the p...

Sec. 324. When Obligors Are Bound Joint And Severally: Since, as has been seen, the mere fact that several persons binding themselves without words of severance creates a joint liability, it follows that in order to create in addition a several liability ...

When Obligors Are Bound Joint And Severally. Continued: Flynn, 238 111. 636, 87 N. E. 866; Curry v. kansas etc. Ry. Co., 68 Kans. 6, 48 Pac. 579; Nabore v. Producers' Oil Co., 140 La. 985, 74 So. 527, L. R. A. 1917 D. 1116; Emery v. Hitchcock, 12 Wend. 156...

Sec. 326. Incidents Of Procedure In The Enforcement Of Contractual Rights By Joint Obligees: As a joint contractual right belongs to all of the obligees taken together, a declaration which showed the existence of such a right, at common law was open to demurrer, a motion in arrest of judgment...

Incidents Of Procedure In The Enforcement Of Contractual Rights By Joint Obligees. Continued: Co., 124 Ala. 322, 26 So. 933; Ah Tong P. Earle Fruit Co., 112 Cal. 679, 45 Pac. 7; Moore v. Harmon, 142 Ind. 655, 41 N. E. 599; Lillie v. Case, 54 Iowe, 177, 6 N. W. 254; Parker v. Wigging, 10 Kans. ...

Sec. 328. Incidents Of Procedure In The Enforcement Of Joint And Several Duties: Judgment in an action against A will not bar subsequent action for the same cause against B if there is no joint relation between them;90 and as joint and several obligations involve separate obligati...

Sec. 329. Judgments For Breach Of Joint Duties Must Be Joint: As the obligation of joint promisors is a single obligation, a single judgment must be given against all the defendants or no judgment in favor of the plaintiff can be rendered.95 Though several joint...

Sec. 330. Judgment Against Or In Favor Of One Or More Joint Obligors Discharges The Others: The obligation of joint obligors is single and indivisible. Therefore if for any reason going to the merits of the action, one obligor can no longer be sued, the others are in effect discharged. This ...

Sec. 332. Effect Of Merger, Satisfaction Or Security Upon Rights Against One Joint Or Joint And Several Obligor: If the debt for which a joint, joint and several or several obligor is bound is completely satisfied, the creditor can have no further right against anybody. Since there was but one debt though severa...

Sec. 333. Release Of One Joint Obligor Releases All: For the same reason, that a joint duty is one and indivisible, it is also true that a release given to one or more joint obligors discharges the others.39 31 See infra, Sec. 334. 32Ibid. 33Se...

Sec. 333a. Discharge By Other Means Than A Technical Release: It is often said that nothing but a techinal release under seal of a joint debtor discharges the obligation of the other joint debtors.58 Such statements, however, necessarily involve the assumption t...

Sec. 334. Release Or Discharge Of One Joint And Several Debtor Releases All: Not only are all joint debtors discharged by a release of one of them, but the same rule is applicable to joint and several debtors. The joint as well as the several liability of all the debtors is di...

Sec. 335. Equitable Relief From Discharge Of One Joint Debtor By Release Of Another: As the rule discharging all joint debtors, whether also severally liable or not, if one of them is released, is a technical rule which undoubtedly more often than not violates the intention of the par...

Sec. 386. Statutory Changes: In most of the United States statutes have somewhat changed the common law in regard to joint obligations. These statutes are, however, not uniform in character. They are aimed chiefly against the rul...

Statutory Changes. Continued: 99Gen. Stat. (1915), Sec.Sec. 6786-6790. 1 Code Sec.Sec. 2077 et seq. 2 Code (1911), Art. L, Sec.Sec. 1,10. 3Rev. Laws (1902), c. 141, {8, c. 170, Sec.14. 4 Camp. Laws (1016), Sec. 14636, etc. 5Gen...

Sec. 337. Effect Of Judgments Against Joint And Several Obligors: The Supreme Court of the United States has said of joint and several liabilities of a number of promisors: If the plaintiff obtains a joint judgment, he cannot afterwards sue them separately, for the...

Sec. 338a. Release Of Joint Tort Feasors: The liability of two or more persons jointly concerned in 37 See Nicholson v. Revill, 4 Ad. & El. 675; Kearsley v. Cole, 16 M. & W. 128; Webb v. Hewitt, 3 K. & J. 438; Green v. Wynn, L. R. 4 Ch. 20...

Sec. 338b. Release Of One Not In Fact Liable: Even though one is not liable for a tort, if he is given a release as a party jointly liable for it, it has been held that this will preclude the releasor from afterwards suing another for the injury ...

Sec. 338c. Summary Of Effect Of Covenant Not To Sue Joint Obligor: The correct conclusions seem to be whether the liability is in tort or contract: 1. If the creditor's rights are expressly reserved, no distinction should be taken between a covenant not to sue and...

Sec. 339. Effect Of Covenants And Qualified Releases Where One Co-Debtor Is A Surety: Though a covenant not to sue or a qualified release does not have the effect as such of discharging other debtors than the one to whom it was given, its effect must also be considered with reference t...

Sec. 340. Importance Of The Creditor's Knowledge Of A Suretyship Relation Between Joint Debtors: Another principle also besides the form of the covenant or release qualifies its effect as a discharge of a joint debtor who in fact is a surety. A creditor who has received the joint obligation of se...

Importance Of The Creditor's Knowledge Of A Suretyship Relation Between Joint Debtors. Continued: bore the relation of principal and surety to each other, and, subsequently, but before covenanting with the principal debtor, received this information. In some decisions it has been held an infringem...

Sec. 342. Sights Of A Co-Debtor Who Has Received A Covenant That He Shall Not Be Sued, Or A Qualified Release: The effect of a covenant not to sue one of several co-debtors or of a release of one with a reservation of rights against the others has been considered from the aspect of the creditor. The same quest...

Sec. 344. Survivorship Of Joint Rights And Duties: If one of several joint obligors dies, the law, following the analogy of survivorship in joint estates in land, has held from an early day and still holds that the whole duty devolves upon the survivi...

Sec. 345. Contribution: Though a creditor may exact full payment of the whole debt, by levy of execution or otherwise, from one only of those severally or jointly, or jointly and severally, liable to him, and cannot be compe...

Sec. 346. Effect Of A New Promise Or Part Payment By A Joint Or Joint And Several Debtor On The Statute Of Limitations: Lord Mansfield held in an early case that a payment by one joint debtor is payment for all, the one acting, virtually, as agent for the rest; and, in the same manner, an admission by one is an admiss...

Effect Of A New Promise Or Part Payment By A Joint Or Joint And Several Debtor On The Statute Of Limitations. Continued: 32 Bell v. Morrison, 1 Pet. 361,373-4, 7 L. Ed. 174; Wilson v. Torbert, 3 Stew. 296, 21 Am. Deo. 632; Espy v. Comer, 76 Ala. 601; Burr v. Williams, 30 Ark. 171; Bissell v. Adams, 35 Conn. 299, 302; Co...

Chapter XIII. Contracts For The Benefit Of Third Persons: Nature of contracts for the benefit of a third person......................... 347 Property rights distinguished from contract rights.................... ...

Sec. 347. Nature Of Contracts For The Benefit Of A Third Person: A contract in which the promisor engages to the promisee to render some performance to a third person is generally called a contract for the benefit of a third person with little regard to whether the...

Sec. 348. Property Rights Distinguished From Contract Rights: Rights of property may arise simultaneously with the making of a contract, and may be enforced by the owner though he was not a party to the contract. His right of action is not based on the law of co...

Sec. 349. Property Rights Distinguished From Revocable Agencies: More difficult than the distinction between contract rights and property rights is the distinction between cases involving such rights and cases of revocable agency. Unquestionably a man can create a ...

Sec. 360. Application Of Foregoing Principles: The statement of these principles is easier than the application of them to concrete facts. One of the commonest cases involving the distinction is that of a general assignment by a debtor for the ben...

Sec. 361. Further Illustrations: Another illustration is furnished by the facts of a New York case.16 Money was deposited in a bank by a corporation which owed coupon bonds to meet a series of coupons about to fall due. The bank agre...

Sec. 362. Agency And Contracts For The Benefit Of A Third Person: In another respect the law of agency touches the borderland of contracts for the benefit of a third person. It is familiar law that if a contracting party either is or assumes to be the agent of anoth...

Sec. 3s3. Novations: Novations and offers of novation must also be distinguished from the other legal relations with which this chapter deals. The aim of the novation is to substitute for an existing obligation another ri...

Sec. 366. When Cestui Que Trust Can Sue On Contract For His Benefit: One more preliminary distinction must be made. A trustee can make a contract for the benefit of his cestui que trust, and if the contract is not performed may sue and recover full damages. A contract ...

Sec. 366. Two Types Of Case Involving Benefit Of Third Persons: There are two quite distinct types of cases which pass current under the name of promises for the benefit of a third person. To the first class belong promises where the promisee has no pecuniary inte...

Sec. 357. Contracts For The Sole Benefit Of A Third Person Should Be Enforceable: The first class is properly called a promise for the benefit of a third person, and the phrase sole beneficiary should be reserved for this class. There may conceivably be several promises in a cont...

Sec. 358. A Court Of Equity Is The Appropriate Forum: There is no satisfactory solution of these difficulties in the procedure of a court administering legal remedies only. But one of the functions of equity is to provide a remedy where the common-law pr...

Sec. 359. Grounds For Equitable Jurisdiction: In the case under consideration the only satisfactory relief is something in the nature of specific performance. The basis for equity jurisdiction is the same as in other cases of specific performance...

Sec. 360. English Law: The right of the beneficiary in such a contract to maintain an action was suggested in a number of early English cases, but judicial opinion was almost invariably against it.32 The well-known case of ...

Sec. 361. Contract To Discharge A Debt Of The Promisee: The second type of case which reference has been made - a contract to discharge an obligation of the promisee - has been held in England enforceable only by the promisee;40 and the law of Canada is th...

Sec. 362. Creditor's Interest In Such A Promise: Yet the creditor is not wholly without interest in the promise to pay his claim. That promise is a valuable right belonging to his debtor. If a solvent promisor has agreed to discharge a debt of the p...

Sec. 363. Right Not Available For Every Creditor: It is, then, a peculiarity in regard to the application of such a promise to the debt of the promisee, that the promise is an asset of which not every creditor can take advantage. As to most property,...

Sec. 364. Creditor's Right Derivative: If the analysis in the preceding sections is sound the claim of the creditor is a derivative one. His only interest in the promise is the interest which he has in any property belonging to his debtor....

Sec. 365. Statutes: The law in the United States has not been much affected be statute. Such statutes as exist are generally of limited application. Many States make a policy of life insurance for the benefit of a wife o...

Sec. 366. Code Provisions As To Real Party In Interest: The common provision in the so-called code States,60 that actions shall be brought in the name of the real party in interest, though sometimes referred to as controlling the question,61 seems properly...

Sec. 367. Massachusetts Law: In no jurisdiction in the United States is the law as strict in denying relief to a stranger to the contract as it is in England. But there is no uniformity in the law of the several States. That of M...

Sec. 368. Law Of Other States: A large majority of the States allow the sole beneficiary to sue at law;70 but besides Massachusetts, the Federal The consideration moves in part from the child, although he is not in a position p...

Law Of Other States. Part 2: Recovery is allowed only where money or property is placed in the hands of the promisor as consideration for his promise. First Methodist Episcopal Church v. Isenberg, 246 Pa. 221, 92 Atl. 141. Rho...

Law Of Other States. Part 3: 80 See infra, Sec.371,n. 81 See cases in preceding notes. 82 Vrooman v. Turner, 69 N. Y. 280, 283, 25 Am. Rep. 195; Beveridge v. N. Y. Elevated R. R., 112 N. Y. 1, 28, 19 N. E. 489, 2 L. R. A. 6...

Sec. 369. Life Insurance Cases: There are several recurring situations which illustrate the contract for the sole benefit of a third person. The commonest is the case already referred to of a life insurance policy for the benefit of...

Sec. 370. Receipt Of Property As Consideration For A Promise To Make A Payment: Another common illustration arises on these or similar facts: A parent gives property to a son, who upon receiving it promises to make specified payments to daughters or others either at once or upon ...

Sec. 372. Bonds To Secure Performance Of Building Contracts Or Other Duty: It is a common stipulation in a building contract that the contractor will pay all bills for labor and materials. In most cases the fulfilment of this promise by the contractor operates to discharge a...

Sec. 372a. Contracts Of Public Service Corporations: A public service corporation frequently enters into a contract with a municipality for the performance of acts in which individual members of the municipality are interested and when a breach of the c...

Sec. 374. Contracts To Perform A Duty Of A Municipality: Where by contract the duty of a municipality is assumed by a corporation, the case seems indistinguishable from any case where a debt or obligation is assumed. The obligation assumed may be pecuniary ...

Sec. 876. Obligation Of Carrier - In Regard To Mail: A case which may be compared with that of a corporation under contract with a municipality is the case of a carrier under contract with the national government to carry mails. It has been urged that s...

Sec. 376. Telegraph Company Cases: A telegraph company's contract made with the sender of a telegram to deliver it to the person addressed is sometimes treated as a contract made for the sole benefit of the latter, who is allowed to su...

Sec. 379. Enforcement Of Beneficiary's Right By Injunction. An Indiana Decision 22 Presents The Rather Unusual Case Of: 18 Rogers v. Galloway Female Col-lege, 64 Ark. 627, 44 S. W. 464, 30 L. R. A. 636; Wilson v. First Presbyterian Church, 56 Ga. 654; Irwin v. Lombard University, 66 Ohio St. 9, 20, 46 N. E. 63, 36 L. R...

Sec. 380. Confusion In Regard To Contracts To Discharge A Debt: 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...

Sec. 381. Most Jurisdictions Allow The Creditor An Action At Law: Whatever may be the answer to these questions, the American jurisdictions are few which do not allow the creditor a direct action at law against the promisor,27 Connecti- 27 The following are cases...

Most Jurisdictions Allow The Creditor An Action At Law. Part 2: Maine. Burbank v. Gould, 15 Me. 118; Hinkley v. Fowler, 15 Me. 285; Bohanan v. Pope, 42 Me. 93; Coffin v. Bradbury, 89 Me. 476, 36 Atl. 988; Baldwin v. Emery, 89 Me. 496, 498, 36 Atl. 994. Maryland...

Most Jurisdictions Allow The Creditor An Action At Law. Part 3: Ohio. Crumbaugh v. Kugler, 3 Ohio St. 544, 649; Bagaley v. Waters, 7 Ohio St. 369; Dodge v. Nat. Exchange Bank, 30 Ohio St. 1; Emmitt p. Bro-phy, 42 Ohio St. 82. Oklahoma. Eastman Land Co. v. Long-...

Sec. 382. What Amounts To An Assumption Of A Mortgage: The most universal illustration of the right of a creditor to sue on a promise to his debtor to pay the debt arises where the grantee of premises subject to a mortgage assumes and agrees to pay the mo...

Sec. 383. A Mortgagee Is Generally Allowed An Action Against A Grantee Who Has Assumed The Mortgage: If it be supposed that the mortgagee undertakes to pay the mortgage, the question then arises can this undertaking be sued upon only by the mortgagor to whom it was made, or does the mortgagee acquire...

Sec. 384. Enforcement In Equity Of The Mortgagee's Right Against The Grantee. It Is A Curious Circumstance That Though A Promise By A Third Person To Pay A Mortgage Debt Cannot Be Distinguished In: Co., 22 Col. 28, 43 Pac 144; Skinner v. Harkar, 23 Col. 333, 48 Pac. 648; Starbird v. Cranston, 24 Col. 20, 48 Pac. 662; Cobb p. Fishel, 15 Col. App. 384, 62 Pac. Rep. 625. See also Lloyd v. Lowe (Col...

Enforcement In Equity Of The Mortgagee's Right Against The Grantee. It Is A Curious Circumstance That Though A Promise By A Third Person To Pay A Mortgage Debt Cannot Be Distinguished In. Continued: Washington. Ordway v. Downey, 18 Wash. 412, 61 Pac. 1047, 52 Pac. 228, 63 Am. St. Rep. 892; Ver Planck v. Lee, 19 Wash. 492, 53 Pac. 724; Frasey v. Casey, 98 Wash. 422, 165 Pac. 104. Wisconsin. Bis...

Sec. 386. Successive Purchases Of Mortgaged Property: It frequently happens that several grantees successively buy the premises and assume payment of the mortgage. It is rightly held that the last grantee can be charged as well as the immediate grantee o...

Sec. 387. Assumption Of Mortgage By Second Mortgagee: Another peculiar situation arises where a mortgagor makes a second mortgage and the second mortgagee agrees to pay off the first mortgage. Subsequently the first mortgagee endeavors to take advantage ...

Sec. 388. Assumption Of Liabilities Of Outgoing Partner: Another class of promises to satisfy a debtor's liability deserves particular mention - the promise of an individual or firm to pay the liabilities of an outgoing partner. It is in this kind of case t...

Sec. 389. Right Of Holder Of Check Against Bank: On the same principle the holder of a check has sometimes been given a right against the bank on which the cheek was drawn.78a The common argument in favor of such a right is that a check is an equita...

Sec. 390. Rights Of The Promisee: It is when the rights of the promisee are considered that the difficulties in the American law become apparent. It seems obviously unfair to subject the promisor to suits both by the creditor and the ...

Sec. 392. Recovery By The Promisee Generally Allowed: Whatever the hardship upon the promisor may be in being liable to two persons when he promised but one, most courts have found it the simpler alternative, a recovery by either party being a bar to an ...

Sec. 398. Creditor's Right To Sue Both Debtor And New Promisor: Diversity of opinion likewise prevails in regard to the right of a creditor whose debtor has received a promise to pay the debt, to sue both the new promisor and the original debtor. Courts which hold...

Sec. 394. Defenses Good Against The Promisee Good Against The Creditor: Another question concerns the admissibility of certain defences by the promisor. When sued by the third person, the promisor may rely on facts showing that the promisee could not enforce the contract....

Sec. 395. Non-Performance By Promisee A Good Defence: A more difficult case arises where the defence does not relate to the origin of the contract, but is based on supervening circumstances, such as non-performance by the promisee of a counter promise ma...

Sec. 396. Rescission Or Release - Sole Beneficiary: The commonest defence, that of discharge by rescission or release, is different. In the case of a sole beneficiary it is like the attempted revocation of a gift. The promisor for good consideration ha...

Sec. 396a. Fraternal Benefit Societies: On principles not very easy to formulate the certificates of fraternal associations nave been distinguished in this matter from insurance policies. In a decision of the United -States Supreme Court9 M...

Sec. 897. Rescission Or Release. Debtor And Creditor Cases: In theory, however, in a case of debtor and creditor the situation is very different from that arising where the third person is a sole beneficiary. The creditor's right is purely derivative, and if t...

Sec. 398. Statute Of Limitations: The nature of a creditor's right against one who has promised the debtor to pay the debt is also involved in determining when the Statute of Limitations bars the creditor's action. On principle the cr...

Sec. 899. Invalidity Of Debt Assumed: Another kind of defence to a promise to pay a debt has given rise to considerable litigation. May the promisor set up that the debtor did not owe the debt or that it was an illegal debt? The answer to...

Sec. 400. All Parties Should Be Joined: In dealing with any of these defences it is obvious that all three parties should have an opportunity of litigating the question since all are interested in it, and it is desirable to have all conclud...

Sec. 401. Contracts Under Seal: None of the earlier cases which allowed a right of action to one who was not a party to the contract related to contracts under seal, and where statutes have not taken away the importance of the disti...

Sec. 402. Person Incidentally Benefited: It sometimes happens that a person who is neither the promisee of a contract nor the party to whom performance is to be rendered will derive a benefit from its performance. A typical case is where A p...

Sec. 408. Further Illustrations: A mere promise to indemnify against damages must also be distinguished. Here the promisor's liability does not arise until the promisee has suffered loss or expense. Until then the promisee has no rig...

Chapter XIV Assignment Of Contracts: Meaning of assignment 404 Choses in action were not assignable in the early common law........ 405 Exceptions to the non-assign...

Sec. 404. Meaning Of Assignment: Much of the difficulty regarding assignment of contracts is due to different meanings which may be attached to the word assignment. A promissory note is assignable; so too is a horse. An assignment by...

Sec. 405. Choses In Action Were Not Assignable In The Early Common Law: It is a familiar statement in the law books that choses in action are not assignable. This was carried so far in the early law that an assignee of a right in contract acquired absolutely no right as s...

Sec. 406. Exceptions To The Non-Assignability Of Choses In Action: The law recognized from early times certain exceptions to the non-assignability of choses in action in the following cases: 1. The crown could make an assignment of a claim due to it, and an assign...

Sec. 407. Distinction Between Assignment Of Rights And Assignment Of Duties: A clear conception of the law governing assignment of contracts can only be obtained by sharply distinguishing between attempted assignments of rights and of liabilities. Where assignment of choses in...

Sec. 408. Enforcement Of Rights By Power Of Attorney: The way in which the common law, at least partially overcame the non-assignabillty of choses in action was by means of powers of attorney. Though the assignee could acquire no rights of his own, as su...

Sec. 410. Equitable Protection Of Assignments: Presumably, because of the difficulties enumerated in the preceding section, Courts of Equity undertook as a branch of their jurisdiction to give, so far as possible, the effect to an assignment which...

Sec. 411. Assignment Of Duties: The duties under a contract are not assignable inter vivos in a true sense under any circumstances; that is, one who owes money or is bound to any performance whatever, cannot by any act of his own, o...

Sec. 412. Assignment Of Bilateral Contracts: Every bilateral contract while still executory on both aides involves both rights and duties for each party. As has been seen in the preceding section, duties under a contract cannot in any true sense...

Sec. 413. What Contractual Rights May Be Assigned: Not all rights under contracts may be assigned. The difficulty standing in the way may be either: (1) that the nature of the right is defined or limited by the personality of the original promisee or,...

Sec. 414. Assignment Of Future Rights: In many of the cases involving assignments of money not yet due, the analogy is suggested of contracts to sell chattel property which the grantor has not yet acquired.79 The analogy between choses in ...

Assignment Of Future Rights. Continued: 82 Shackleford v. Kiser Co., 131 Ala. 224, 31 So. 77. See also Clanton Bank the rule is not universally followed. There are decisions upholding an assignment of all future book debts of a business,83 ...

Sec. 418. A Contract Of Option Is Assignable: Some question has arisen of the right of one who holds an option to assign his right to another. An option if given for consideration or under seal is a contract; 96 and the right of the promisee migh...

Sec. 416. Assignability Of Right To Subscribe To Stock: The right of one who has contracted to subscribe to the stock of a corporation to assign this right has been called in question,3 on the ground that a corporation in disposing of its stock has an inte...

Sec. 418. Assignable Bilateral Contracts: If the duties to be performed by a party to an executory bilateral contract are not of such a personal character that their performance cannot be delegated, and if his rights are assignable in their n...

Sec. 419. Personal Responsibility In Bilateral Contracts As Preventing Assignment: Not infrequently it is given as a reason for holding a bilateral contract non-assignable that the personal liability of the assignor to perform on his part, undertaken by him in the original contract ...

Sec. 420. What Is Called An Assignment May Be An Offer Of Novation: The apparent misunderstanding of some courts as to the meaning of assignment in a bilateral contract, to which attention is called in the preceding section, is in many cases probably merely a reflecti...

Sec. 421. Non-Assignable Bilateral Contracts: No bilateral contract for personal service can be assigned by either party to it.52 Nor can the duty of one who was to execute a mortgage on certain land be delegated to any assignee of the land.53 ...

Sec. 422. Express Prohibition Of Assignment: As rights in contract are based on the expressed intention of the parties, such rights by agreement may be limited to the original promisee. It may also be agreed that a contractual duty shall not be ...

Sec. 423. Express Permission Of Assignment: Rights which would not otherwise be capable of assignment because too personal in their character, and duties the performance of which for a similar reason could not be delegated, may be assigned or d...

Sec. 424. What Amounts To Assignment: No words of art are required to constitute an assignment; any words which fairly indicate an intention to make the assignee owner of a claim are sufficient,84 and the same construction should be given...

What Amounts To Assignment. Part 2: 15 So. 444; Caahman v. Harrison, 90 Cal. 297, 27 Pac. 283; Meldrum c. Henderson, 7 Colo. App. 256, 43 Pac 148; Windsor Cement Co. v. Thompson, 86 Conn. 511, 86 Atl. 1; Talladega. Mercantile Co. v. Rob...

What Amounts To Assignment. Part 3: 96 In the following cases a check was held to operate as an assignment: Niblack v. Park Nat. Bank, 189 111. 517, 48 N. B. 438, 39 L. R. A. 159, 61 Am. St. Rep. 203; Gage Hotel Co. v. Union Nat. Bank, ...

Sec. 426. Whether An Unconditional Order Or Bill Of Exchange May Ever Be An Assignment: Whether it may be shown that an assignment of a particular fund or part of it was intended, though the order given to the intended assignee makes no mention of a particular fund, and in terms directs ...

Sec. 427. Orders On A Drawee To Pay When He Has Collected: Sometimes an order is given upon a drawee who has not yet collected the claim to which the order refers. That such an order operates as an assignment of the drawer's claim against the drawee when the ...

Sec. 428. Promises To Assign Or To Pay Out Of A Particular Fund Are Not Assignments: It is sometimes said that every assignment of a chose in action is merely an executory contract which equity considers as executed, and which the law following equity regards as conferring certain ri...

Promises To Assign Or To Pay Out Of A Particular Fund Are Not Assignments. Continued: 775, 33 8. E. 666, the court reached a contrary conclusion quoting from Jones d. Glover, S3 Ga. 484, 487, 21 S. E. 50. In order to infer an equitable assignment, such facta or circumstances must ...

Sec. 480. Formalities Requisite For Assignment: The common law recognized two kinds of property, tangible property of which delivery of possession or livery of seisin 35 might be made, and intangible property which in so far as transferable at all ...

Formalities Requisite For Assignment. Continued: Except as statutes have made a change, an assignment need not even be in writing. An oral assignment for value is sufficient not only to give the assignee a legal power of attorney to collect the clai...

Sec. 431. Construction Of Assignment: In case of doubt, an assignment is construed most strictly against the assignor,56 and generally the rules ordinarily applicable to the construction of contracts are applied. Where an attempted ass...

Sec. 482. Rights Of The Assignee Against The Debtor: One who has legal title to real estate or to chattel property which he holds subject to an equity, and who transfers his legal title to a bona fide purchaser for value without notice, transfers a titl...

Rights Of The Assignee Against The Debtor. Part 2: 68Graham v. Tilford, 1 Met. (Ky.) 112; Walker v. McKay, 2 Met. (Ky.) 294 (see also Merchants' Nat. Bank v. Robinson, 97 Ky. 552, 31 S. W. 136, 28 L. R. A. 760); Chambliss v. Matthews, 57 Miss. 306; My...

Rights Of The Assignee Against The Debtor. Part 3: If, however, the objection to the validity of an assignment is not that it is void but voidable only at the option of the assignor, or of some third person, the debtor has no legal defence whether or ...

Sec. 433. Notice To The Debtor As Affecting The Assignee's Right Against Him: The debtor should not be prejudiced by an assignment of which he has no notice. Accordingly if, prior to notice, he pays the debt to the assignor or is released from it by him, or acquires a set-off, ...

Sec. 434. Notice To The Debtor As Affecting The Assignee's Right Against The Assignor's Creditors: No notice to the debtor of an assignment of a non-negotiable chose in action is necessary to give the assignee an equitable right. This is universally agreed to be so as between the parties; 96 and is...

Sec. 485. Notice To The Debtor As Affecting The Mutual Rights Of Successive Assignees. If An Assignment Of Itself Be Regarded As Creating A Legal: right in the assignee, the first of two or more assignments would apparently prevail over the others. Similarly even though an assignment is held to create merely an equitable right, the prior assignm...

Sec. 436. Notice To The Assignee: It is possible to make a gift of tangible property without notice to the donee if delivery is made to a third person on behalf of the donee.20 And not only may the legal title to property be transferr...

Sec. 437. What Amounts To Notice: Where there is a question of the priority of successive assignments, in jurisdictions which follow the English rule concerning notice, and also in all jurisdictions where the question arises whether a...

Sec. 438. Whether The Assignee Is Subject To Equities Of Third Persons: Though it is well settled that an assignee is subject to the equities of the obligor, it is a matter of dispute how far an assignee is subject to equities of third persons against the assignor; as, fo...

Sec. 439. Gifts Of Tangible Choses In Action: Certain choses in action have such tangible form that the form is popularly regarded as being itself the obligation. To some extent the law has sanctioned this popular view. A bond, a policy of insura...

Sec. 410. Gifts Of Intangible Choses In Action: Unless a chose in action has such tangible form as to induce the law to regard it as in the nature of chattel property, certainly no effective gift of it can be made without a deed, for either deliver...

Sec. 441. Partial Assignments: Several different kinds of transactions may be entered into by those who seek to transfer a partial interest in a chose in action. 1. An intention may be manifested that the assignee shall enforce ...

Sec. 442. A Partial Assignment Gives The Assignee No Right To Sue At Law: A debtor who is bound for the payment of a sum of money or for the delivery of a quantity of goods cannot be required to make performance in instalments unless he expressly or impliedly agreed to do s...

Sec. 443. Rights Of Partial Assignee In Equity And Under Codes: As between the assignor (or any one who stood in no better position than the assignor) and a partial assignee it was early recognized in England that the assignee was equitably entitled to the portion...

Sec. 444. Rights Of The Debtor To Settle With His Creditor In Spite Of Partial Assignments: The Supreme Court of Wisconsin has held 96 that though a partial assignee may maintain a suit to enforce his assignment, making both assignor and debtor parties, nevertheless, where a creditor has giv...

Sec. 445. Implied Warranties Of The Assignor: It was early decided that the assignor of a claim impliedly covenanted against any acts of his own, or of any one claiming under him, in derogation of the assignment.2 Therefore if the assignor collec...

Sec. 446. Procedure: As has been Been,15 at common law an assignee of a chose in action could enforce his right at law only in the name of the assignor. He had, however, full power to control an action in that name if the...

Sec. 446a. Distinction Between Legal And Equitable Rights: As will appear from the following section important consequences follow from the answer given to the question whether the assignee's right is legal or equitable. If the matter is looked at from a hist...

Sec. 447. Whether The Assignee's Right Is Legal Or Equitable: The right of an assignee of a chose in action may be called equitable in this sense because of the following characteristics: 1. An assignee takes subject to all existing equities in favor of the d...

Book III. The Statute Of Frauds. Chapter XV. Scope Of Statute. Promises To Answer For The Debt Of Another: Purpose and history of statue of frauds.............. 448 Scope of the English statute.............. 449 American statutes.........

Sec. 448. Purpose And History Of Statute Of Frauds: As has been seen l a contract in writing was classed by the common law with parol contracts and had no added validity on account of the writing. Writing was indeed from the very nature of the case, ne...

Sec. 449. Scope Of The English Statute: The sections of the Statute of Frauds which relate to the necessity of a writing are Sections 1, 2, 3, 4, 7, 8, 9, 17. A summary of these sections is as follows: Section 1. Leases and estates or in...

Sec. 460. American Statutes: The various clauses of the English statute are generally reenacted in the United States, and slight changes in wording are not generally treated as varying the meaning of a provision.7 The provision r...

Sec. 451. Promises By An Executor To Pay Damages Out Of His Own Estate: This clause has been construed as if the words for the debt or default of another were to be understood at the end of the clause, which is thus in effect equivalent to the next clause in the statu...

Sec. 462. Purpose Of The Second Clause Of Section 4 Of The Statute: It is of assistance in the construction of the next provision of the statute to have in mind the probable purpose of the legislature in providing that promises to answer for the debt of another must b...

Sec. 453. Guaranties Of All Kinds Of Obligations Included In The: statute. Under the words in the second clause of Section 4, debt, default, or miscarriages are included, all forms of liability. A special promise to answer for the obligation of another in tort,20 ...

Sec. 454. No Promise Is Within The Statute Unless There Is Another Obligation: It is essential that a primary obligation of some kind shall be incurred in order to bring the case within the statute. Therefore a promise to be answerable for the debt or default of one who is not r...

Sec. 454 Promise To Answer For Tee Debt Of Another 869: an obligation in fact,26 or because he is incompetent to bind himself legally, as where an agent gives an oral personal guarantee of an ultra vires contract of his principal,27 or a promisor guarantee...

Sec. 454 Promise To Answer For Tee Debt Of Another 869. Part 2: 32 Cowenhoven v. Howell, 36 N. J. L. 323, 327, citing: Goodman v. Chase, 1 B. & Ald. 297; Fitsgerald v. Dressier, 7 C. B. (N. S.) 374; Kebey v. Bibbs, 13 Ohio St., 340; Butcher v. Steuart, such a case...

Sec. 454 Promise To Answer For Tee Debt Of Another 869. Part 3: 45 In Read v. Nash, 1 Wilson, 305, the plaintiff's testator brought an action for assault against J, and the defendant being present promised the testator, if he would not proceed to trial, to pay him...

Sec. 457. Promises To Sign Guaranties Or Negotiable Accommodation Paper: An exception, in form at least, to the rule that the new promise must be identical in its terms with the original obligation exists in case of a promise subsequently to sign a guaranty of another's de...

Sec. 468. Obligations On Negotiable Paper Are Not Within The Statute: It is obvious that the obligations incurred by all parties to a negotiable instrument except that of the party primarily liable, are obligations to answer for the debt of another. The matter may be lo...

Sec. 1195: 57 Espalla v. Wilson, 86 Ala. 487, 5 So. 867; Spurgeon v. Swain, 13 Ind. App. 188, 41 N. E. 397; Lavell v. Frost, 16 Mont. 93, 40 Pac. 146; Dull v. Bricker, 76 Pa. 255. 58 If the written request o...

Sec. 459. No Promise To Perform An Obligation Imposed By Law On The Promisor Is Within The Statute: The words of the statute special promise to answer for the debt, etc., of another may fairly be supposed to have been used to distinguish the liability of one who had become a debtor irrespective of...

Sec. 460. To Whom The Promise Must Be Made: Though the words of the statute are in terms applicable to a promise made to any one to pay a debt of a third person, by construction of the courts, which have had in mind the mischief aimed at, the a...

Sec. 461. Promises Made Prior To The Creation Of The Principal Debt: Mr. Justice Story said in a leading case:76b Whether by the true intent of the statute, it was to extend to cases where the collateral promise (so-called) was a part of the original agreeshareholder ...

Sec. 463. Distinction Between Original And Collateral Promises: A promise which is within the statute is often said to be collateral, if not within the statute it is called original. The terms collateral or original promise did not occur in the statute, and have ...

Sec. 464. A Promise May Be Original Though The Promisor Does Not Receive The Benefit Of The Consideration: In early times debt would not lie unless the goods, services, or money which formed the basis of the action had been received by the defendant; but subsequently it became a settled rule that whatever...

Sec. 466. Whether A Promise Prior To The Creation Of A Debt Is Primary Or Collateral Is A Question Of Construction: It is not helpful to try to establish what special words constitute a promisor who induces the creation of a debt by his promise a primary debtor, and what words indicate merely a collateral obligatio...

Sec. 466. Debts Originally Incurred As Joint Or Joint And Several Obligations: The words of the statute require the existence of a debt independent of the obligation created by the special promise. Therefore, a joint promise which is in law a single liability is not within the...

Sec. 467. New Promise In Form A Guaranty: It is not infrequently assumed or stated that a promise to pay a debt or perform a duty if another person fails to do so, is within the statute, but that a promise may be made orally if it is absolute...

Sec. 466. New Promise In Form To Pay The Debt Of Another: Perhaps it might more plausibly be suggested that the applicability of the Statute depends upon whether the promise in question is in terms to pay the debt of another, so that the contract by its very...

Sec. 469. Discharge Of The Original Debt As A Test: It is often said that a new promise is presumptively within the Statute of Frauds unless the original debt is discharged. As all the authorities admit that there are cases where this presumption is in...

Sec. 470. The Purpose Of The Promisor As A Test: Perhaps as common a test as any that has been suggested for distinguishing promises which fall within the statute from those which fall without its boundaries, is based on the supposed purpose or obje...

Sec. 471. A New Promise Whereby The Promisor Makes The Debt Of Another His Own: An attempt is often made to distinguish new promises which fall within the statute from those falling outside its limits by saying that where the new promisor makes the debt his own, the promise is no...

Sec. 172. Whether The Receipt Of A New And Beneficial Consideration By A Promisor Takes His Promise Out Of The: statute. It has been established by a line of cases that the surrender to a new promisor of property which was held by the creditor as security for his claim prevents the promise from falling within t...

Whether The Receipt Of A New And Beneficial Consideration By A Promisor Takes His Promise Out Of The. Part 2: 323, 325, the court said: Id case of a promise to become liable for an existing debt or obligation, there must, in order to sustain such promise, and render it unobjectionable in view of the statute,...

The Receipt Of A New And Beneficial Consideration By A Promisor Takes His Promise Out Of The. Part 3: 26h King v. Wilson, 2 Stra. 873; Fish v. Hutchinson, 2 Wils. 94; Tomhinson v. Getl, 6 A. & E. 564; Westmoreland v. Porter, 75 Ala. 452; Scott v. Thomas, 2 111. 58; Kruts v. Stewart, 54 Ind. 178; Jones...

Sec. 473. Importance Of Distinguishing Whether The Consideration For A New Promise Is Received As The Equivalent Of A Debt: Attempts which have been made to differentiate new promises according to the character of the consideration given by the promisee have either been bo broadly inclusive as to cover in effect all kinds ...

Sec. 474. Modern English Test: The test suggested in recent English cases 26o making the application of the statute depend not on the consideration for the promise, but on the fact of the original party remaining liable, coupled w...

Sec. 476. From Whom The Consideration Must Move: It has been held in Massachusetts, and a few other States, that an oral promise to a creditor is within the statute, though the promisor may have assumed the obligation to pay in consideration of a tr...

Sec. 477. A New Promise Which Discharges The Original Obligation Is Not Within The Statute: Where a third person promises a creditor to discharge a debt due from another to the latter, the arrangement may conceivably take one of three forms: 1. The new promisor may undertake a several obl...

Sec. 478. Promise To Debtor To Assume And Pay The Latter's Debt: though enforceable by creditor is not within the statute. As has been seen the application of the statute has been confined to promises made to the creditor;42 but under a rule generally prevailing...

Sec. 479. A Promise To Pay The Promisor's Own Debt To His Creditor's Creditor Is Not Within The Statute: Nor is the principle different where a promisor previously indebted undertakes for sufficient consideration to pay the debt, or part of it, to a creditor of his own creditor. Here, too, the promisor i...

Sec. 481. Application Of Principles To Building Contracts: Cases have frequently arisen where a subcontractor or material man refuses to continue the performance of his contract because of the actual or prospective failure of the general contractor to make ag...

Sec. 482. Promises To Indemnify: The greatest confusion exists in regard to the question whether promises to indemnify are within the statute. It has been pointed out59 that part of the confusion is due to an attempt to treat all pro...

Promises To Indemnify. Continued: 68 See supra, Sec. 472. 69 Confusion must not be caused by the fact that the obligation may be conditional on default by the principal debtor to the holder of the obligation. If the sureties are ac...

Sec. 483. Promises In Part To Pay The Debt Of Another, Or To Pay Part Of The Debt Of Another: It sometimes happens that a promisor engages to pay the debt of another and also render some performance which is not within the Statute of Frauds. In such a case the problem is presented of how far t...

Sec. 453, And Even Though The Parties Bad In Mind That There Might Be A Possible Difference In The Scope Of The Two Obligations, The Result Should Be The Same. See Supra, Sec. 454: 78Winckworth v. Mills, 2 Esp. 484 (overruled); Fasten v. Clem (Ala.), 78 So. 883, 1 A. L. R. 381; May v. Williams, 61 Miss. 126, 48 Am. Rep. 80; Craft v. Lott, 87 Miss. 590, 40 So. 426, 6 Ann. Cos....

Sec. 484 Promise To Answer For The Debt Of Another 933: If the plaintiff sues on that portion of a divisible promise, which is outside the statute, whether he can recover, depends upon principles somewhat analogous to those governing contracts in part ille...

Chapter XVI. Agreements In Consideration Of Marriage; Contracts Or Sales Of Ant Interest In Lands; Agreements Not To Be Performed Within A Year: Agreements in consideration of marriage.............. 485 Marriage settlements.................. 486 Contracts for the sale of l...

Sec. 186. Agreements In Consideration Of Marriage: The distinction must be drawn between agreements in contemplation of marriage and agreements in consideration thereof. The statute does not invalidate an oral promise merely because it is made in cont...

Sec. 186. Marriage Settlements: There can be no doubt of the sufficiency of marriage or of a promise to many as consideration for an executory promise; nor is this point ever disputed. But if a promisor or grantor is insolvent his c...

Sec. 187. Contracts For The Sale Of Land Distinguished From Conveyances: At common law corporeal hereditaments could be conveyed only by livery of seisin or by deed; and incorporeal hereditaments could be conveyed only by deed.18 Executory contracts, however, for the sale ...

Sec. 488. What Is A Contract For Sale Or Purchase: Any contract the purpose of which is to transfer to one of the parties an interest in land for a price paid or to be paid to the other party is within the statute. The price need not be payable in mon...

Sec. 189. Contracts Of Agency And Partnership: The authority of an agent to enter into a contract for the sale or purchase of land though given orally will enable him to bind his principal by contract with a third person,36 except where statutes e...

Sec. 490. Contracts Of Partition Or Fixing Boundaries: In some States an anomalous position is given to contracts of partition and to contracts to settle a disputed boundary. It would seem on principle that an oral agreement for partition would be unenfor...

Sec. 491. What Is An Interest In Land: The line which the decisions have drawn between goods, wares, and merchandise on the one side, and interests in land on the other side, is considered in connection with a later section of the statute....

Sec. 492. Contracts To Sell Or Discharge Mortgage Debts: It has been held in England that a contract for the sale of a debt secured by mortgage, even though the debt is represented by a negotiable bond or debenture, is a contract for the sale of an interest...

Sec. 493. Contracts Relating To Land But Not For Its Sale Are Not Within The Statute: It is only contracts for the sale of any interest in land which are affected by the statute. Accordingly contracts which relate to land but do not involve agreement for its sale are not within the sta...

Contracts Relating To Land But Not For Its Sale Are Not Within The Statute. Continued: 98In Norcross p. James, 140 Mass. 188,191, 2 N. E. 946, Holmes, J., said: The question remains, whether, even if we make the further assumption that the covenant was valid as a contract between the p...

Sec. 494. Part Performance Of Agreements For The Sale Of Land: From an early day courts of equity have excepted from the operation of the Statute of Frauds cases where there has been part performance, so called, of the agreement. Whether the basis of the doctrine...

Part Performance Of Agreements For The Sale Of Land. Part 2: however, a stricter rule prevails than that hitherto stated. In some of these States payment of all or part of the consideration or improvements on the property must be made as well as possession take...

Part Performance Of Agreements For The Sale Of Land. Part 3: 29Clerk v. Wright, 1 Atkins. 12 (giving instructions for drawing conveyances); Phillips v. Edwards, 33 Beav. 440 (preparation of deed); Nibert v. Baghuret, 47 N. J. Eq. 201, 205, 20 Atl. 252. In Gould...

Sec. 496. Agreements Not To Be Performed Within A Year: It is well settled that the oral agreements invalidated by the statute because not to be performed within a year include those only which cannot be performed within that period. A promise which is not...

Agreements Not To Be Performed Within A Year. Part 2: Holbrook, 118 N. Y. 586, 593, 23 N. E. 908, 16 Am. St. Rep. 788, the court said: While it is true, as insisted by the appellant, that it was not provided by the terms of the contract that it should b...

Agreements Not To Be Performed Within A Year. Part 3: 45 Frost v. Tarr, 53 Ind. 390; Riddle v. Backus, 38 Ia. 81; Heery v. Reed, 80 Kans. 380, 102 Pac. 846; McDaniel v. Hutcherson, 136 Ky. 412, 124 S. W. 384; Sword v. Keith, 31 Mich. 247; Jilson v. Gilbe...

Sec. 496. Promises To Support For A Term Of Years: Some courts have too hastily supposed that such decisions as those cited in the preceding section afforded support for the conclusion that a promise to support a minor until he reaches a stated age mo...

Sec. 497. Promises Not To Compete For A Fixed Period Exceeding A Year: The principle that promises performable during the whole life or at the death of the promisor or another are performable within a year has been extended by some courts to a case where a promise to ref...

Sec. 498. Promises Subject To An Express Defeasance Or Providing For Alternative Performance: The distinction between an excuse for not performing and completion of performance, previously adverted to (supra, Sec. 496) is taken in contracts requiring for their performance a period exceeding a ...

Sec. 600. Agreements Of Which The Parties Do Not Contemplate Performance Within A Year: The distinction is also fine but important between - 1. An agreement which may be performed, as the parties intend that it shall be performed, within a year, though they fully expect that performance ...

Agreements Of Which The Parties Do Not Contemplate Performance Within A Year. Continued: 68In White v. Fitts, 102 Me. 240, 66 Atl. 533, 15 L. R. A. (N. S.) 313, the plaintiff was to cut down and saw into the desired lengths all of the standing timber on the 350 acres of defendant's timber...

Sec. 501. Promises To Marry And Promises Falling Within Other Clauses Of The Statute: It has been held in some cases that a promise to marry at a time more tham a year from the making of the agreement is not within the statute,81 but the contrary rule is better supported.82 If any dist...

Sec. 602. Calculation Of The Term Of A Year: How the period of a year is to be calculated has given rise to some litigation. If a contract, for instance a contract of service, is for the term of a year beginning on the day of the contract, there...

Calculation Of The Term Of A Year. Continued: Sutchliffe v. Atlantic Mills, 13 R. I. 480, 43 Am. Rep. 39. See also Oak Leaf Mill Co. v. Cooper, 103 Ark. 79, 146 S. W. 130; Mendelsohn v Banov, 57 S. Car. 147, 35 S. E. 499; Lee v. Hill, 87 Va. 497,...

Sec. 504. Contracts Performable Or Performed Within A Year On One Side But Not On The Other: It has been settled in England that though part performance of an oral agreement not performable within a year does not take the contract out of the statute, yet full performance within a year on one ...

Chapter XVII. Contracts For The Sale Of Goods: Statutes of Frauds in England and America concerning sales of goods...... 505 Statute of Frauds in Sales Act........................................ ...

Sec. S05. Statutes Of Frauds In England And America Concerning Sales Of Goods: The seventeenth section of the English Statute of Frauds 1 is as follows: And be it further enacted by the authority aforesaid, That from and after the said four and twentieth day of June [A. D. 1...

Sec. 507. "A Contract To Sell Or A Sale.": The question was early made under the English Statute whether it applied to executory contracts to sell goods as well as to sales, and there were decisions to the effect that executory contracts were ...

Sec. 508. Contracts Of Work And Labor - The English Rule: Contracts for work and labor have never been within the terms of Statutes of Frauds. It is, therefore, necessary to mark the line which divides such contracts from contracts to sell. The early English...

Sec. 509. American Rules: Although the rule finally reached in England is absolutely logical and is the only rule that has ever been suggested for which so much can be said, it has not been followed in the United States. The o...

Sec. 510. Exchanges: It is said by Chalmers in his annotation of the English Sale of Goods Act, that an exchange is not within the meaning of sale in the Statute of Frauds. He cites no authority for this, however, and in ...

Sec. 611. Mortgages: It is not clear at common law whether a mortgage of goods is to be regarded as within the statute. In jurisdictions where it is held that a mortgage does not transfer title but merely creates a lien, ...

Sec. 614. " Of Any Goods.": The words of the original English statute were goods, wares, and merchandises, and they have been copied in many American statutes, but the term goods, as defined in the Uniform 27 Mason v. Spi...

Sec. 515. Crops And Fructus Industriales: It would seem, on principle, that as long as crops are growing or even standing matured in the earth, they are affixed to the realty; and that an agreement for an immediate transfer of title to them w...

Sec. 516. Trees And Fructus Naturales: In England the court has gone to great length in supporting the validity of an oral contract to sell standing trees. In Marshall v. Green,43 there was a parol sale of thirty-two trees to be got away ...

Sec. S17. Water And Ice: Water when separated from a stream or lake becomes personalty. In the case of Jersey City v. Harrison,46 where one town had contracted to supply water to another at a specified price per million gallo...

Sec. 618. Minerals, Manure: Minerals also, though part of the realty, may be severed and, when severed, become goods. A contract to sell severed iron ore would be a contract to sell goods even though the ore which the parties ex...

Sec. 519. Fixtures: The legal interest which a tenant has in articles affixed to the realty, but which he has a right to remove, is a right to sever the fixtures and revest himself with the title to them as personalty. C...

Sec. 620. Buildings: Agreements are not infrequently made for the sale of buildings or of the materials in standing buildings. If the contract is to sell and deliver a house, even though the house is at the time of the ba...

Sec. 021. Choses In Action: Under the English statute it is settled that choses in action are not included within the terms goods, wares, and merchandises. This is true even though the chose in action in question is evidenced...

Sec. 523. "Of The Value Of.": The English statute contained the words for the price, and the word price has generally been copied in statutes in the United States. Lord Tenterden's Act,73 however, made use of the word value,...

Sec. 524. " Five Hundred Dollars Or Upwards.": The amount fixed by the English statute is £10 or upwards and this sum has generally been translated in the United States into $50. In Arkansas, Maine, and Missouri, it is fixed at $30;79 in New Hamps...

Sec. 524a. Agreements To Execute A Written Memorandum Of An Oral Contract: Sometimes parties not only enter into an oral contract within the Statute of Frauds but further agree to reduce their oral agreement to writing. If this last agreement can be specifically enforced it ...

Chapter XVIII. Effect Of Failing To Comply With Statutory Formalities: Varying language of the fourth and seventeenth sections of the English statue............. 525 Language of American statutes.......... 526 ...

Sec. 626. Language Of American Statutes: Maryland alone, of the United States, seems to have adopted the English statute as such, as part of her jurisprudence,3 but the statutes of other States contain words which are either the same as thos...

Sec. 527. Effect Of Noncompliance With The Statute: Under the English statute it has been held that only the enforceability, not the validity, of a bargain depends upon the satisfaction of the statute. It is even said that the only effect of the statut...

Sec. 628. The Statute Does Not Affect Fully Executed Agreements: The Statute of Frauds invalidates only agreements executory at least on one side, whether rendering them unenforceable as in most jurisdictions or wholly void as in a few others. It does not render tr...

The Statute Does Not Affect Fully Executed Agreements. Continued: 28 Andrews v. Jones, 10 Ala. 400; Gordon v. Tweedy, 71 Ala. 202; Crane v. Gough, 4 Md. 316. In regard to an exceptional doctrine concerning antenuptial agreements see, however, supra, Sec. 486. Ano...

Sec. 630. Third Persons Cannot Take Advantage Of The Statute: It follows from what has been stated that a contract or sale within the statute is valid except that it cannot be enforced against either party or his successor in interest unless the statute has been...

Third Persons Cannot Take Advantage Of The Statute. Continued: 51 Waite v. McKelvy, 71 Minn. 197, 73 N. W. 727; Ely v. Ormsby, 12 Barb. 670. See also Winner v. Williams, 62 Mich. 363, 28 N. W. 904. Here also it should be noticed that both the Minnesota and the Ne...

Sec. 532. Divisible Contracts: A contract though within the statute as to some portion of the performance promised by the defendent, may not be as to the remainder. Such a contract is nevertheless unenforceable in any part, since t...

Sec. 533. The Doctrine Of Part Performance Applies Exclusively To Contracts For The Sale Of Land: In contracts for the sale of goods which are within the statute, its express terms provide that certain acts of part performance operate as a satisfaction of its requirements, so that there has been n...

The Doctrine Of Part Performance Applies Exclusively To Contracts For The Sale Of Land. Continued: 73 Woodward, Quaai-Contracts, Sec. 94. 74 Gosbell v. Archer, 2 Ad. & E. 500; Head v. Sanders, 189 Ala. 443, 66 So. 621; Littell v. Jones, 56 Ark. 139, 19 S. W. 497; Bergtold v. Worthy, 182 111. App...

Sec. 630. Restoration Or Recovery In Specie Of What Has Been Given Or Received: It should not be requisite for the plaintiff to restore what he has received. The requirement of restoration by a plaintiff who seeks to rescind a transaction for the defendant's fraud or breach of pr...

Sec. 536. Measure Of Damages: As the defendant has committed no legal wrong in refusing to perform an unenforceable contract, the plaintiff's measure of damages is based, not on the extent of his loss from the nonperformance of th...

Sec. 637. Recovery Of The Value Of Improvements: A special kind of quasi-contractual relief is allowed to the purchaser of realty who has made improvements thereon in reliance on an unenforceable contract, where specific performance is not permitted...

Recovery Of The Value Of Improvements. Continued: 7 See infra, Sec.Sec. 1473 et seq. 8 Ibid. 9 Britain v. Roasiter, 11 Q. B. D. 123, 127. As a matter of actual decision, it cannot be assumed that a plaintiff in default will be treated in the sa...

Chapter XIX. Satisfaction Of The Statute By Acceptance And Receipt Or Part Payment: Methods of satisfying the statute............ 539 Satisfication of Section 17 540 Acceptance and receipt are not equivalent to ...

Sec. 539. Methods Of Satisfying The Statute: Section 4 of the English statute specifies but one way of making contracts within its scope enforceable, namely, by a written memorandum of the contract signed by the party to be charged, or his agent...

Sec. Mo. Satisfaction Of Section 17: The statute specifies two ways in which contracts or sales within its terms may be made binding, besides the giving of a memorandum: (1) Acceptance of the whole or part of the goods (or choses in acti...

Sec. 641. Acceptance And Receipt Are Not Equivalent To Delivery: In the early English cases, involving the question of acceptance and actual receipt, the word delivery is frequently used as if that word were the equivalent of acceptance and actual receipt.8 The w...

Sec. 642. Acceptance: The meaning of acceptance, under the statute, seems to be an assent on the part of the buyer to take specified goods as the statute is reduced to writing the memorandum, it has been held, makes the wh...

Sec. 543. Time Of Acceptance: It is clearly settled that acceptance, as well as receipt of the goods, may be subsequent to the common-law bargain to which the statute is applicable, whether a contract to sell or a sale.18 A more d...

Sec. 644. Acceptance By Dealing With The Goods As Owner: Though acceptance will oridnarily take place after the buyer has sufficiently examined the goods to understand their nature and quality, it is obviously possible for a buyer to accept goods without ma...

Sec. 545. Right Of Objection: Much discussion has arisen in regard to the question whether acceptance can take place before the purchaser has lost his right to object. In several cases statements have been made that this is imposs...

Sec. 546. Right Of Rejection: By a curious substitution of a word that seems similar, but means something different, Lord Campbell's decision and statement in Morton v. Tibbett,39 that an acceptance might take place though the lig...

Sec. 547. Modern English Rule: The curious substitution of the word reject for object has enabled the English court to give a meaning to acceptance widely different from any meaning given by any court prior to 1S78, and remarka...

Sec. 648. Who May Accept: A buyer may accept the goods by an authorized agent. 45 The power of the agent to bind his principal depends upon the law of agency. The statute imposes only the limitations immediately to be mentione...

Sec. 649. Parties May Withdraw Before The Satisfaction Of The Statute: Until the contract or sale has become enforceable under the statute either party may withdraw; consequently, the buyer may reject the goods though he has previously accepted them, provided he has not ...

Sec. 660. Acceptance Under A Mistake: In Rodgers v. Phillips, Daniels, J., said, referring to an acceptance of an alleged bill of lading by the buyer after the goods which it represented had been destroyed: What they did in this respect...

Sec. 652. Forcible Taking Or Giving Of Possession: In an early English case 63 it was casually remarked by Abbott, C. J,: I do not mean, however, to say that if the buyer were to take away the goods without the assent of the seller, that would not be...

Sec. 563. Receipt Of Goods In The Hands Of A Third Person: There is no doubt that goods may be received within the meaning of the statute while still remaining in the hands of a third person as bailee.69 It is necessary, of course, that the buyer assent to th...

Sec. 654. New York Rule: In a leading case in New York 74 which has had great subsequent influence, the court laid down a rule more stringent than that suggested in the preceding paragraph. Wright, J., said: The uniform doct...

Sec. 656. Receipt By Delivery To A Carrier: When goods, at the time unspecified, have been ordered from a distance or are to be selected and appropriated by the seller and shipped to the buyer by a carrier, the statute is not satisfied by the d...

Sec. S57. Receipt Of Goods In The Hands Of Buyer: It sometimes happens that at the time of a bargain the goods in question are already in the possession of the buyer. Under these circumstances the goods will generally be identified and no difficulty ...

Sec. 568. Receipt Of Goods In The Hands Of Seller: As has been previously seen 92 acceptance cannot be made by the seller himself acting as agent for the buyer, and as will hereafter be seen one party cannot be the agent for the other to sign a memora...

Sec. 569. Symbolic Receipt: It is not always possible in the case of bulky goods, or goods at a distance, for the seller to transfer possession of the goods themselves immediately and, under the Statute of Frauds as well as in o...

Sec. 660. Documents Of Title: By far the most important kind of symbolic delivery is that made by bills of lading and warehouse receipts. There are surprisingly few cases raising the question, but upon principle it seems clear tha...

Sec. 661. Part Of The Goods: By the terms of the statute acceptance and receipt of part of the goods suffice, and it is immaterial how small the part may be. It is. therefore, sufficient if the buyer receives a sample of the good...

Sec. 662. Choses In Action: Most of the statutes which specifically include choses in action within the statute also mention acceptance and actual receipt of the evidences of the choses in action as a method of satisfying the st...

Sec. 664. "Or Give Something In Earnest To Bind The Contract": At the present day, earnest as distinguished from part payment is seldom or never given. Formerly a small payment was sometimes made to bind the bargain which was not regarded as part of the price.24 ...

Sec. 666. "Or In Part Payment": The statute by these words requires no specific amount to be paid but it does require payment. Consequently a tender is not enough.26 Nor does it suffice that the price remain in the buyer's hands for...

Sec. 566. Time Of Payment: Under the English statute and similar American statutes (including the Uniform Sales Act), it makes no difference when the payment is made with reference to the oral bargain.54 In some States, however...

Chapter XX. Satisfaction Of The Statute By A Memorandum In Writing: Some note or memorandum in writing of the contract or sale............. 567 Form of memorandum............ 568 Contents of memor...

Sec. 667. Some Note Or Memorandum In Writing Of The Contract Or Sale: The requirement of a writing is the only method of satisfying any clause of the fourth section of the statute and is a permissible way of satisfying the seventeenth section. Consequently, in determini...

Sec. 068. Form Of Memorandum: The memorandum may be in any form, and an enumeration of particular cases that have arisen is not exclusive, but merely illustrative. The memorandum may of course be in the form of a carefully prepare...

Sec. 689. Contents Of Memorandum - Parties: It is essential that the memorandum state the substance of the transaction to which it relates. It is necessary, therefore, that the memorandum state the name of both parties to the bargain.*11 It is ...

Sec. 670. Contents Of Memorandum - Consideration: In a case decided near the beginning of the nineteenth century,28 the Court of Kings Bench held that a promise to pay a debt of another could not be enforced when the memorandum simply stated the prom...

Sec. 671. How Far A Statement Of The Consideration Should On Principle Be Included In The Memorandum: The matter may be considered either from the standpoint of the technical language of the statute, or from the standpoint of practical desirability. Doubtless if the language of the statute has a clear...

How Far A Statement Of The Consideration Should On Principle Be Included In The Memorandum. Continued: 39 See supra, Sec.Sec. 1, 14. 40 See supra, Sec. 2. 41 See infra, Sec. 835. 42 Egerton v. Mathews, 6 East, 307. 43 See supra,Sec.Sec. 49, 106. 44Thus a written offer is generally held a...

Sec. 573. What Is A Sufficient Statement Of The Consideration: No sooner had it been decided in England that a statement of consideration in the memorandum was essential, than the courts were called upon to decide what was a sufficient statement; and it was held ...

Sec. 571. Contents Of Memorandum - Price. It Might Seem That Price Was The Equivalent Of Consideration: 64 In Osborne v. Baker, 34 Minn. 307, 308, 25 N. W. 606, 57 Am. Rep. 55, Mitchell, J., said: If this was a new question, we have not much doubt but that we would hold with the respondent that the wor...

Sec. 676. Contents Of Memorandum - Other Terms Of The Contract: The property to which a sale, or contract to sell, relates, must be described in the memorandum.72 So, although the contract appearing in the memorandum seems to be complete upon its face, if, in fact...

Sec. 676. Certainty Of Description-General Principle: The question often arises whether a memorandum states with sufficient certainty the bargain to which it relates. Even though all the terms are included, they may be written in such an abbreviated way ...

Sec. 677. Certainty Of Description Of Parties: It is within the principle allowing definition of terms, that if a memorandum names A as one of the parties to the transaction, though A can be held personally liable,90 it may, if desired, be shown b...

Sec. 578. Certainty Of Description Of Property: The same kind of question arises in regard to a description of the property sold. The land or goods to be sold, or also the debt to be guaranteed, must be sufficiently described for reasonable identif...

Certainty Of Description Of Property. Continued: 4 This deecripion was held insufficient in Doherty v. Hill, 144 Mass. 466, 11 N. B. 681. See decisions stated in Wood on the Statute of Frauds, Sec. 353. In Mead v. Parker, 116 Mass. 413, it was held,...

Sec. 579. Intent To Make A Memorandum Is Not Requisite: As the purpose of the statute is to require a formality of proof in order to make a contract enforceable, not to impose a wholly independent of everything but the will of the contracting parties, leav...

Intent To Make A Memorandum Is Not Requisite. Continued: 8The statutes relating to the sale of goods do not use this word, but a number of statutes relating to agreements in regard to land do. See supra, Sec. 567. 9Welford v. Beasely, 2 Atk. 503; Bailey ...

Sec. 580. Separate Documents-Physical Attachment: A memorandum need not be contained in one writing; any number may be taken together to make out the necessary written expression of the terms of the bargain provided there is sufficient connection mad...

Sec. 681. Separate Documents-Incorporation By Reference: Where there are several documents not physically attached to each other, it may be supposed either that all the documents which it is desired to use are signed by the party to be charged or that some ...

Sec. 582. Separate Documents-Incorporation By Necessary Inference: Until comparatively recently the authorities did not extend the right to make out a memorandum from separate documents, some of which were unsigned by the defendant, beyond the case of reference by a ...

Sec. 683. Separate Documents - Reference To The Same Transaction: Recent English cases have adopted a doctrine going quite as far as the doctrine criticized in the preceding section. Where a signed document refers to the transaction in question an unsigned memorandu...

Sec. 584. Consistency Of Separate Documents: It is sometimes said that separate papers constituting a memorandum must be consistent with each other in order to be used.46 Reflection shows that there are obvious limits to any such principle. In t...

Sec. S86. " By The Party To Be Charged.": The seventeenth section of the original English statute reads parties to be charged, while the fourth section uses the singular party. The latter form has been generally used in the United States,...

Sec. 587. Or His Agent In That Behalf: The original statute allowed signature by an agent and this has been universally followed in this country. Who may be an agent and how his authority may be shown depend upon the principles of the law ...

Sec. 588. Auction Sales: In part at least, from the necessity of the case rather than from evidence of actual authority, it has from early times been continuously held that the auctioneer at an auction sale is not only the ag...

Sec. 589. Brokers' Notes: There have been numerous English decisions in regard to contracts made by brokers upon the question of memoranda under the Statute of Frauds. The English practice is for a broker employed to make a pu...

Sec. 590. Time Of Making The Memorandum: It is commonly said that a memorandum may be made at any time subsequent to the making of a contract, and prior to the bringing of an action. It may, however, be made even before the contract is made,...

Sec. S91. Written Contracts May Be Varied By Subsequent Oral Agreemnt "By The General Rules Of The Common Law, If There Be A Contract [Not Within The Statute Of Frauds] Which Has Been Reduced: 8See Emery v. Boston Terminal Co., 178 Mass. 172, 59 N. E, 763, 86 Am. St. Rep. 473. 9The leading case is Felthouse v. Bindley, 11 C. B. (N. S.) 889. In that case the seller of a horse by an oral s...

Sec. S92. Rescission Of Contracts Within The Statute Of Frauds: If an executory contract is within the Statute of Frauds and is in writing or a proper written memorandum has at some time been made, a subsequent oral agreement to rescind the contract is effectual i...

Sec. 593. Variation Of Contract Within The Statute Of Frauds - General Doctrine: More difficult questions are presented when the subsequent oral agreement does not purport totally to rescind but only to vary some of the terms of an original bargain, which was within the Statute of...

Sec. 696. Non-Performance Of Provisions Of A Written Memorandum Caused By A Party Is Excused: Though no other contract can be enforced except that which is represented by the written memorandum, subsequent oral agreement varying the terms of the contract may not be without effect. Admitting, a...

Sec. 596. Damages: The question may be important not only with reference to the right of recovery but with reference to the amount of damages. In Ogle v. Vane30 it was held that the plaintiff who had contracted to bu...

Sec. 597. Pleading: The difficulty in dealing with the situation seems generally to have arisen from the pleading. If the plaintiff sues on the oral contract or on the written and oral contracts combined, he cannot prove...

Sec. 600. Conflict Of Laws: As most provisions of the Statutes of Frauds prevailing in different States of the Union are identical in the several jurisdictions, questions of the conflict of laws arise less frequently on most cla...

Book VI. Remedies For Breach Of Contract.. Chapter XXXVI What Constitutes A Breach Of Contract: A breach of contract involves a broken promise........................ 1288 Promises payable on demand.........................................1289 Partial and total breach.........................

Sec. 1288. A Breach Of Contract Involves A Broken Promise: As a contract consists of a binding promise or set of promises, a breach of contract is a failure, without legal excuse, to perform any promise which forms the whole or part of a contract. It is immat...

Sec. 1289. Promises Payable On Demand: Generally there can be no breach of a promise until all the conditions qualifying it have happened or been performed.5 But a peculiar rule prevails in regard to promises to pay on demand. When a part...

Sec. 1290. Partial And Total Breach: Though breach to any extent of any promise in a contract 8 gives rise to a cause of action, it has already appeared9 that a slight breach will not necessarily end further duties of the injured person ...

Sec. 1291. One Action Only Is Allowed For A Single Breach Of Contract: Certain rules of procedure qualify the right of on injured party to sue for breach of promise. In laying down these rules the law seems to have had two objects in view: first, the restriction of suits...

Sec. 1293. Implied Promises: It is not only for breach of express promises that a contractor is liable but of implied promises as well ; and the most serious difficulty in this matter is to determine what promises are fairly to b...

Sec. 1291 Performance Of A Promise Must Be Made As Such: Even though a promisor is prepared to keep and does keep his promise according to its express terms, he will, nevertheless, violate his contract unless his performance is rendered as a performance of ...

Sec. 1295. Renewed Offers Of Performance: Frequently by the terms of a contract a promisor is given a period of time at any moment of which he may make the agreed performance. Such a contract will not be broken until the agreed period has ela...

Sec. 1296. Anticipatory Or Prospective Breach: Logically, there can be no breach of a promise until the terms or conditions qualifying the promise have been fulfilled. One who contracts to do a certain thing on a certain contingency or at a certai...

Sec. 1297. Lord Cockbum's Rule In Regard To Repudiation: But if the injured party to a bilateral contract has not fully performed and there has been no actual violation of promise by the other party (unless words expressing the speaker's intention concernin...

Sec. 1298. First Half Of Cockbum's Rule Approved In England But Inconsistent With American Decisions: This language was quoted with approval in a later decision44 and may be regarded as expressing the present understanding of English lawyers on the matter in question.45 The alternalive stated as permi...

Sec. 1299. Rule Of Damages Not Applicable In Every Case: The English courts have recognized that a plaintiff who fails to use reasonable means to mitigate or at least not to enhance the damages which a defendant is to be called upon to pay, cannot recover s...

Sec. 1300. American Decisions Sound: Judged in the light of every consideration of mercantile convenience the American decisions are correct. The facts of one of the few cases55 which are directly opposed to them need only be stated to i...

Sec. 1302. Contract Not Terminated: Neither where the plaintiff's excuse for his own non-performance is the defendant's actual breach of the contract nor where that excuse is a prospective breach because of repudiation does the plaintif...

Sec. 1303. Practical Importance Of Distinction: To be sure it frequently makes little practical difference whether this is the case or whether the contract is in fact rescinded. Where the only question that arises is in regard to the liability of a...

Sec. 1304. No Manifestation Of Election Necessary: Further, in order to exercise his right to rescind a contract, an injured party must indicate his election so to do by positive action71 but if he only wishes to refrain from performing his part of th...

Sec. 1305. Prospective Inability To Perform Should Excuse: If it is clear that one party to a contract is going to be unable to perform it the other party should be excused from performing. The excuse is the same as in cases where a wilful intention not to pe...

Sec. 1306 Time When Right Of Action Accrues: The final question remains, after a repudiation before the time for performance, when may the injured party bring his action upon the contract? If a technical declaration were as much thought of to-da...

Sec. 1308. Early Decision: In Y. B. 21 Edw. IV. 54, pl. 26, Choke, J., says : If you are bound to enfeoff me of the manor of D. before such a feast, if you make a feoffment of that manor to another before the said feast, notwi...

Sec. 1309. Explanation Of The: What Choke was talking about was a bond with a condition. This appears from the case itself where his remark was made as an illustration, and so it was understood.79 At the present day a bond with a c...

Sec. 1310. Explanation Of Case Continued: Whether this view of the law was that generally taken by the contemporary judges, and, if so, when it gave way to a more modern conception, is not very material to this discussion, but it may be menti...

Sec. 1311. Erroneous Statement Of Fuller, C. J: When, therefore, Fuller, C. J., of the Supreme Court of the United States, in the leading American decision on the point asserted, It has always been the law that where a party deliberately incapacit...

Sec. 1312. Other English Cases: In 1846 there were decided two cases in which a defendant was held liable for the breach of a promise to marry. In one of these cases 90 the defendant's promise was alleged to be simply to marry the p...

Sec. 1313. Hochster V. De La Tour: So the matter stood in 1852 when the case of Hochster v. De La Tour94 was decided.. In that case the plaintiff had entered into a contract with the defendant to serve him as a courier for three months...

Sec. 1314. Moden Law: These two misapprehensions of Lord Campbell, for as such they must be regarded, make the case an unsatisfactory one. It has, however, settled the law in England.97 and the doctrine for which it stands...

Sec. 1315. Distinction Between Defence And Right Of Action: The reasoning in Hochster v. De La Tour,4 already adverted to, illustrates the importance of a distinction, which should be observed - the distinction between a defence and a right of action. This see...

Sec. 1316. Distinction Between Action For Restitution And Action On The Contract: Another important and frequently neglected distinction is that between an action for restitution and an action on the contract. Since repudiation affords immediate cause for rescission it also entitle...

Sec. 1317. No Inconsistency In Allowing Full Damages Before All Performance Due: Again, it is often thought to allow a plaintiff to sue and recover full damages before the time for the completion of all the defendant's performance is to allow the doctrine of anticipatory breach,8 ...

Sec. 1318. Action May Be Based On Breach Of Subsidiary Promise: Under this principle a right of action may accrue by breach of a subsidiary promise, long before the defendant's main performance is due, and the subsidiary promise may be an implied one. In any case ...

Sec. 1319. Time Of Performance Fixed By Act Of The Promisee: The time for the defendant's performance is frequently fixed in a contract, not by naming a definite day, but by some act to be done by the plaintiff - either a counter-performance or a request. If th...

Sec. 1320. Contracts To Many: A great many of the cases cited in support of the doctrine of anticipatory breach are upon contracts to marry; 25 and these cases may well be distinguished. Lord Cockburn said in Frost v. Knight : On...

Sec. 1321. Practical Convenience: The reason most strongly urged in support of the doctrine of anticipatory breach is, however, its practical convenience. It is said that if it is certain that the plaintiff is going to have an action,...

Sec. 1322. Necessity Of Election To Treat Repudiation As A Breach: Not only, moreover, do logic and the defendant suffer, but the very practical convenience which is the excuse for their suffering is not attained. A few illustrations from recent cases will show that ...

Sec. 1323. What Constitutes An Election To Treat Repudiation As A Breach: Though an election by the injured party is stated to be a prerequisite of an anticipatory breach, what action constitutes such an election has not been much considered. Logically it would seem that an...

Sec. 1324. Positiveness Of Repudiation: It is stated in the decisions that in order to give rise to an anticipatory breach of contract the defendant's refusal to perform must have been positive and unconditional.86 In Ding-ley v. Oler,37 th...

Sec. 1325. What Amounts To Total Repudiation: Such repudiation as will constitute a breach may take various forms besides that of a positive statement of refusal to perform. Thus selling land,42 or goods,42a to which the contract relates before t...

Sec. 1326. Whether Anticipatory Inability To Perform Amounts To A Breach: One of the first cases relied on as establishing the doctrine of anticipatory breach involved prospective inability to perform because of a lease to a third person of land contracted to be leased to t...

Sec. 1327. Supreme Court Holds Bankruptcy Anticipatory Breach: In Central Trust Company v. Chicago Auditorium Association 50 in discussing the question whether on bankruptcy of a party to a bilateral contract before a breach the solvent party had a provable claim...

Sec. 1328 There Can Be No Anticipatory Breach Of Unilateral Obligations: If the reasoning suggested in Frost v. Knight 58 and adopted by the Supreme Court of the United States 59 for the doctrine of anticipatory breach is accepted, namely, that a contract gives immediately...

Sec. 1329. Independent Obligations: As independent promises in a bilateral contract are in effect separate unilateral obligations, a rule which forbids enforcement of anticipatory repudiation as a breach in unilateral contracts also for...

Sec. 1330. Repudiated Contract Of Insurance: The uncertainty which marks the boundaries of the doctrine of anticipatory breach is well illustrated by three cases which arose in the States of Massachusetts, New Jersey and New York, respectively, ...

Sec. 1331. Repudiation May Be A Defence Though It Does Not Amount To A Breach: It has been shown76 that the treatment of anticipatory repudiation as a breach was probably due to a recognition of the necessity of giving the injured party a defence, coupled with the assumption tha...

Sec. 1332. Time When Repudiation Becomes Effectual: The prevailing doctrine seems to be that expressed in a leading English case,78 by Lord Bowen that the declaration of such intention by the promisor is not in itself, and unless acted on by the prom...

Sec. 1333. Effect Of Failing To Elect To Treat Repudiation As A Breach Under The English Rule: Under the rule laid down in the English cases a failure to elect to treat anticipatory repudiation as a breach involves a continuance of the obligations of the contract upon both sides It is this f...

Sec. 1334. American Decisions Opposed To English Rule: Most of the American decisions seem indisposed to follow the undesirable lead of the English decisions, holding rather that the repudiation though not taken advantage of as a cause of action is, never...

Sec. 1335. Withdrawal Of Repudiation: Where a defendant has repudiated the contract after an actual breach but before the time for full performance has arrived, there seems no doubt that this repudiation can be withdrawn before the other ...

Sec. 1336. Possible Distinction Between The Effect Of Repudiation Before Breach And After Partial Breach Of A Contract: In many of the cases discussing the doctrine of anticipatory breach, there had been already an actual breach of contract, but the time for the full completion of the defendant's performance had not ye...

Sec. 1337. Summary Of American Doctrine In Regard To Anticipatory Breach: Unquestionably the great weight of American authority, whether rightly or wrongly, accepts the doctrine of anticipatory breach but with some differences from the English law. If the doctrine is to be ...

Chapter XXXVII. Measure Of Damages For Breach Of Contract: Compensation is the fundamental principle............................ 1338 Compensation should be not the value of the contract, but of the performance of the contract.................................

Sec. 1338. Compensation Is The Fundamental Principle: For the injury caused by the non-performance of most contracts the primary if not the only remedy of the injured party is an action for damages for the breach. In fixing the amount of these damages, t...

Sec. 1339. Compensation Should Be Not The Value Of The Contract, But Of The Performance Of The Contract: It is sometimes said that the law regards a breach of contract as in effect a destruction of the contract by the wrongdoer, for which the law substitutes a right of action for damages in favor of the ...

Sec. 1340. Exceptions To The Principles Of Compensation: Though the general principle stated in the preceding section is clear, the rule of compensation is not without exception. There are instances6 where the law because of the lack of definite proof of da...

Sec. 1341. Recovery For The Plaintiff's Preparations: Since the measure of recovery in an action of contract is based upon what the defendant should have given the plaintiff, not what the plaintiff has given the defendant or otherwise expended, recovery ...

Sec. 1342. Value: Since the only compensation a court of law can give is pecuniary, it is constantly necessary in appying the rule of compensation to determine the pecuniary value of performance which has been promised...

Sec. 1343. Value To The Plaintiff: As the plaintiff is the injured party, the fundamental inquiry is the value to him of the performance of the contract (which may be a different thing from the value to the general public) subject to t...

Sec. 1344. Proximate And Natural Consequences: With the qualification stated in the following sections a plaintiff can recover for breach of contract compensation for only such consequences of the breach as are both proximate and natural. When a s...

Sec. 1345. Damages Must Be Reasonably Certain: Though any breach of contract entitles the injured party at least to nominal damages, he cannot recover more without establishing a basis for an inference of fact that he has been actually damaged. A ...

Sec. 1346. Certainty Of Damage And Certainty Of Amount Of Damage: An attempt is sometimes made to distinguish between certainty that some damage has been caused, and certainty as to the amount of damage; but no broad statement can be made that where it is uncertain ...

Sec. 1347. Illustrations Of Consequential Damages Allowed When The Defendant Had Proper Notice: When a defendant has been notified, before entering into the contract in question, of facts indicating that unusual damages will follow or may follow his failure to perform his agreement, he is liable...

Sec. 1348. Principle Is Applicable To Partial Breach: The principle is applicable to a partial as well as to a total breach. Thus the importance of performance exactly at the time agreed or with unusual promptness may be brought home to the defendant by ...

Sec. 1349. Unilateral And Bilateral Contracts: Where a unilateral contract is broken, the only performance to be valued is that of the defendant promisor. The plaintiff ex hypothesi has already performed and is therefore entitled to the full value...

Sec. 1350. Rule Of Damages Where Promises Are Dependent: Where not only the promises but also the performances in a bilateral contract are intended as the exchange for one another,48 it may be supposed (1) that the plaintiff's performance was to precede tha...

Sec. 1352. Recovery Of Full Value Of Defendant's Performance Where Plaintiff's Performance Is Of No Value: If excuse from the performance under a bilateral contract to which a plaintiff is bound will be of no pecuniary advantage to him he may recover the full amount promised him by the defendant even thoug...

Sec. 1353. Avoidable Consequences: The plaintiff's right is to recover such damages as the defendant's wrong necessarily caused him. It is usually said that the plaintiff is under a duty to mitigate damages; but the truth in the Massac...

Sec. 1354. Replacement: When a defendant has broken his contract to furnish goods or services, it may become a question of judgment on the part of the plaintiff whether loss is likely to be greater if he seeks to replace at ...

Replacement. Continued: Me. 317, 24 Am. Rep. 31; Caves v. Bartek, 85 Neb. 511, 123 N. W. 1031; Hamilton v. McPherson, 28 N. Y. 72, 84 Am. Dec. 330; Bates v. Fish, etc., Co., 60 N. Y. App. D., 38, 63 N. Y. S. 6...

Sec. 1356. The Rule Of Hadley V. Baxendale: In a leading English case,80 decided in 1854, an extension of the rule governing consequential damages was stated which has been generally adopted. Under this extension (in the language of the court) ...

Chapter Xxxv111. Application Of Rules Of Damages To Particular Cases: Contracts of employment...........................................1358 Mitigation or enhancement of damages...............................1359 Burden of proof.......................................

Sec. 1359. Mitigation Or Enhancement Of Damages: An offer by the employer to employ again a discharged employee will mitigate the damages to which he is entitled if nothing connected with the discharge makes a renewal of the service inequitable.6 It...

Sec. 1361. Employee's Right To Sue For Future Wages: The English courts formerly permitted a wrongly discharged servant to sue for subsequently accruing wages, as such, either waiting until the termination of the period for which he was hired,18 or brin...

Sec. 1362. Employee's Recovery Where Trial Precedes The Expiration Of Contract: Where the employee's suit comes to trial before the expiration of the term of his contract, it is impossible to say exactly how. much the plaintiff may be able by his earnings to mitigate the damages ...

Sec. 1363. Contract For A Particular Service: The principle governing contracts for a particular piece of work are the same as those governing more general contracts of employment. If the work is done according to the contract30 or if, though not...

Sec. 1364. Seller Of Goods May Recover Price Where Property Has Passed: Where the property in goods which are the subject of a bargain has passed and the buyer wrongfully neglects or refuses to pay for them, the seller may recover the price,42 even though the buyer refuse...

Sec. 1865. Recovery Of Price Allowed In Some Jurisdictions Where Property Has Not Passed: The general rule of the English law47 and of many of the United States 48 denies an action for the price unless the property has passed, and the reason for the rule is plain. As the seller still is ow...

Sec. 1366 Decisions Under Statute Of Frauds As Basis Of Rule: Why the price should be recoverable is not always made clear. The earliest decision was in Bement v. Smith,51 an action for the price of a sulky built to order by the plaintiff for the defendant and r...

Sec. 1367. Restriction Of New York Rule: Some States restrict the application of the New York doctrine to cases where the goods contracted for are of a peculiar kind, not readily salable on the market and for which, therefore, a market price...

Sec. 1368. Rule Often Condemned, But Just: The doctrine, whether in its broadest or most restricted form, at first sight strikes most legal theorists as both anomalous and erroneous. It is sometimes condemned by text-writers.64 But the rule in...

Sec. 1369. Rule Thought Anomalous, And Opposed By Some Au-: thorities It is not, however, chiefly because the rule is unjust that fault is found with it; it is rather because it seems at variance with established legal principles. It seems anomalous ...

Sec. 1371. So In Cases Of Mistake, Duress, Infancy, Or Insanity. The Same Rules Of Law Apply Where Rescission Of Title Is Allowed: 70Wheelden v. Lowell, 60 Me. 409. See also Smith v. Hale, 158 Mass. 178, 33 N. E. 403, 35 Am. St. Rep. 485, where on the assertion by the buyer of a warranted buggy of a right of rescission for breach...

Sec. 1378. Rescission Of Title By Buyer: In the converse case, where the buyer seeks to rescind a transfer of title to him, whether for fraud,80 mistake,81 or breach of warranty,82 the same rule again prevails. The buyer may, if he chooses, ...

Sec. 1374. Conditional Sales: A case which presents a still closer analogy to that primarily under discussion arises in the law of conditional sales.86 . In such sales the seller may recover the full price, though the title to the...

Sec. 1375. Executory Contracts. A Somewhat Analogous Doctrine Of Self-Help Exists In The Law: Broadway Automobile Co., 65 Wash. 650, 118 Pac. 817, 37 L. R. A. (N. 8.) 71. 90 See supra, Sec.736. 91 Tanner Engine Co. v. Hall, 89 Ala. 628, 7 So. 187; Montgomery Iron Works v. Smith, 08 Ala. ...

Sec. 1378. Summary Of Reasons For Allowing Seller To Recover Price: The illustrations which have been given show that the allowance of what is in effect specific performance of an obligation, or the transfer of ownership at the election of one party without the other'...

Sec. 1377. The CIVIL Law: It is worth noticing that in the Civil law the seller in entitled to recover the full price when the buyer is in default. By the classical Civil law the property never passed until delivery of the goo...

Sec. 1378. Measure Of Damages For Non-Acceptance Of Goods: Where a buyer of goods under an executory agreement breaks his contract by refusing to accept the title to goods which are in existence, and either the local law does not allow the virtual specific pe...

Sec. 1379. Seller's Damages Where Goods Have No Market Value: If there is no market value for which the goods can be sold, it is impossible to lay down a narrower principle than that sellers in such a position are entitled to the full amount of the damage whic...

Sec. 1s80. Seller's Damages Where He Has Not Obtained The Goods: In the preceding sections it is assumed that the seller has acquired at the time of the breach the goods to which the contract relates, but owing to the defendant's repudiation this may not be the cas...

Sec. 1381. Damages For Failure To Deliver Goods When Property Has Passed: As the goods belong to the buyer as soon as the property in them has passed, the amount of his recovery if the seller fails the care, the expense of doing so should be deducted. Willis v. Jarrett Cons...

Sec. 1382. Allowance Of Higher Subsequent Value: It has often been urged that the value of the goods at the time of the wrongful conversion or refusal to deliver by the seller may not fully compensate the buyer for the wrong done him. It may be supp...

Sec. 1383. Buyer Is Entitled To The Difference Between The Market And Contract Prices: The application of the general principle of compensation can be summed up by the same formula where the title has not passed and the buyer is the plaintiff as in the case where the seller is the plain...

Sec. 1384. Buyer's Damages Where There Is No Market Price: It may be that no market exists at the place where delivery was due. The nearest available market furnishes the basis under such circumstances; the expense of obtaining and transporting the goods from...

Sec. 1386. Limitation Of The Buyer's Right To Recover The Difference Between The Market Price And The. Contract Price: The test of market value is, at most, but a means of getting at the buyer's loss, and under special circumstances it may cease to be exact or may become inapplicable. The buyer may be able to get simi...

Sec. 1386. Other Cases Where The Buyer's Damages Are Limited: Owing to other special circumstances the buyer may actually suffer less damage from the seller's failure to deliver than the difference between the contract price and the market price; as for instance...

Sec. 1887. Delivery Of Too Small A Quantity: Where a seller is under a contract to deliver a specific quantity of goods and tenders a smaller quantity, the buyer may reject the tender.54 The buyer may, however, accept the offer though defective....

Sec. 1388. Deficient Delivery Under Instalment Contract: But in case the seller's obligation is either by its terms or by the buyer's permission performable in instalments it may happen that the buyer, not supposing the seller is going to be guilty of a bre...

Sec. 1389. Deficient Delivery Where Contract Is Entire: It may, however, be supposed that the contract was entire and that no part of the price was due until full performance by the seller. Even in such a case, if the buyer accepted a portion of the goods ...

Sec. 1390. Damages For Delay In Delivery: The seller may perform his contract otherwise but break it in regard to the time of performance. The normal measure of damages in such a case is the difference in value of the goods at the date contra...

Sec. 1391. Damages For Defective Quality - General Rule: The general measure of damage for breach of warranty of quality is the difference between the value of the article actually furnished the buyer and the value the article would have had if it possessed...

Sec. 1392. Restricted Rule Of Damages For Fraud: The contrary view, however, confining the damages in deceit to the value of what the plaintiff parted with, less the value of what he received, has the support of the Supreme Court of the United State...

Sec. 1398. Consequential Damages For Breach Of Warranty Of: One who warrants goods to possess a certain quality is held to an extensive liability for consequential damages for breach of the warranty; perhaps on the ground that such a person should more readily...

Sec. 1394. Further Illustrations: The general principle allowing consequential damages naturally resulting from a breach of warranty is not much disputed, but the question of what consequential damages are too remote is not always dec...

Sec. 1395. Action For Breach Of Warranty Of Title To Goods: There is no reason on principle why different rules should govern the measure of damages for breach of warranty of title and the measure of damages for breach of warranty of quality.8 5 Huyett & Sm...

Sec. 1396. Damages For Breach Of Warranty Of Title To Goods: Not only is it disputed when the buyer's cause of action or right to substantial damages arises, but also what is the basis for calculating substantial damages when the right to them has arisen. On pr...

Sec. 1397. Damages For Anticipatory Breach: After an anticipatory breach a defendant should not be liable for any greater damage than is naturally caused by the defendant's wrong. If the plaintiff by taking one line of conduct may secure such a...

Sec. 1399. Contracts For The Sale Of Land: There is no reason on principle why the measure of damages for breach of contracts for the sale of land should differ from that applied to contracts for the sale of personal property. Some courts, how...

Sec. 1400. Delay In Performing Contract For Sale Of Land: Where a vendor delays making a conveyance beyond the agreed time, it may be assumed that those jurisdictions which hold that a vendor acting in good faith is not liable in damages for loss of the barg...

Sec. 1401. Breach Of Covenants In Deeds: The ordinary covenants in deeds of real estate are that the grantor is lawfully seised; that he has a right to convey; that the premises are free from encumbrances; that the grantee shall quietly enjo...

Sec. 1402. Damages For Breach Of Covenant Of Warranty: Assuming that the time has arrived when the plaintiff has become entitled to substantial damages, the measure of damages logically should be the amount which would put the plaintiff in as good a posit...

Sec. 1403. Landlord's Right To Rent: A landlord is entitled to recover rent as it matures and not before,69 If a landlord accepts a surrender of the lease70 or even justifiably71 evicts the tenant, he cannot recover rent; nor can he reco...

Sec. 1404. Covenants In Leases: For breach of the covenant of quiet enjoyment a few jurisdictions still apply the early rule applicable to contracts to sell real estate,76 and if the breach of covenant is not accompanied with moral ...

Sec. 1405. Contract To Give A Lease: Jurisdictions which deny to one who has contracted for the purchase of real estate other relief against a vendor free from moral fault than a restoration of any payments and expenses which may have be...

Sec. 1406. Negative Agreements: If the defendant's contract is to refrain from action, difficult questions often arise as to the value of his performance. Breach of a contract to forbear temporarily to sue a debtor prima facie gives...

Sec. 1408. Damages For Failure To Pay A Promisee's Debt: The measure of damages for breach of a contract to discharge an obligation of the promisee to a third person is the amount of the debt. Thus where a principal violates a promise to a surety to pay the...

Sec. 1409. Promises To Indemnify: A distinction, sound in principle, though often difficult to draw in fact, must be taken between a contract on the one hand to assume or pay or indemnify against a debt or liability of the promisee an...

Sec. 1410 Contract To Pay Money: Where the defendant's obligation to pay money is dependent on an obligation of the plaintiff, still at least partially unperformed, to furnish property or services; the measure of damages has been con...

Sec. 1411. Contracts To Lend Money: Breach of a contract to lend money for whatever period at the current rate of interest, or at whatever rate of interest for no definite time, involves no legal damage,32 unless consequential damages a...

Sec. 1412. Nature Of Interest: Interest may be reserved by the terms of a contract between the parties, and is then called conventional interest, or it may be awarded by the law as damages though no agreement for interest has been ...

Sec. 1414. Interest On A Penal Bond: As said by the Supreme Court of the United States,56 There has been much contrariety of opinion upon the question whether, in any case, the obligee in a penal bond can recover interest in addition t...

Sec. 1415. Interest On Quasi-Contractual Obligations: Interest is allowed not simply when an express contract is broken but also where money is wrongly withheld by the defendant and the plaintiff's right is based on quasi-contract; as for instance where ...

Sec. 1416. Rate Of Interest: Where the contract between the parties makes no provision for interest, if any is allowed it must be given at the legal rate;72 and the same is true where the contract provides for interest at the leg...

Sec. 1417. Compound Interest: The general rule is that compound interest is not allowed as damages. Logically it would seem that if a note or other pecuniary obligation is payable with interest annually or at other stated periods,...

Chapter XXXIX. Specific Performance: General principles of specific performance............................ 1418 Specific performance of contracts to bay and sell....................... 1410 Specified and unspecified goods............

Sec. 1418. General Principles Of Specific Performance: The remedy of specific performance enables a court having equitable powers to compel a party to a contract to perform, if not exactly at least substantially, what he has undertaken to do. Save where a...

Sec. 1419. Specific Performance Of Contracts To Buy And Sell: Partly because a specific piece of land is in its nature different from every other piece, and presumably partly because of the overshadowing social and economic importance of land when the doctrines ...

Sec. 1419a. Specified And Unspecified Goods: In a leading English case,28 Lord Westbury said: A contract for the sale of goods, as, for example, of five hundred chests of tea, is not a contract which would be specifically performed, because it ...

Sec. 1420. Insolvency As A Ground For Specific Performance: It has been held or stated in a number of cases that insolvency of the defendant affords a sufficient reason of itself or in connection with other facts for the specific enforcement of a contract to t...

Sec. 1421. Miscellaneous Contracts: Not only because of inherent difficulties in granting the relief, but often also because the agreement was regarded in any court as opposed to public policy,47 equity will neither enforce an agreement...

Sec. 1422. Equity Will Not Make A Decree Impossible Of Performance: Even though the impossibility of performing his contract is due to the defendant's own fault, equity will not decree that he shall do what obviously is beyond his power.66 For this rear son if a vendo...

Sec. 1423. Equity Will Not Make A Decree Involving Excessive Difficulty To Execute: Damages are frequently a wholly inadequate remedy for breach of a promise to render personal services, but two analogous difficulties stand in the way of specific enforcement. (1) Long and minute supe...

Equity Will Not Make A Decree Involving Excessive Difficulty To Execute. Continued: In Adams v. Messinger, 147 Mass. 186, 17 N. E. 491, 9 Am. St. Rep. 679, the court enforced specifically a contract by which the defendant had agreed to furnish and deliver certain patented injectors. ...

Sec. 1424. The Contract Must Be Certain: A court of equity cannot grant specific performance unless a decree can be framed which states with some exactness what the defendant must do. This necessity makes a degree of certainty necessary for ...

Sec. 1425. Discretionary Character Of The Remedy: As has been said, wherever a contract is unenforceable at law, ordinarily it is unenforceable in equity.2 Such defences, as fraud, duress, mistake, illegality, which would be ground for a defence, eit...

Discretionary Character Of The Remedy. Continued: 7 Weeghman v. Killifer, 215 Fed. 168, 289, 131 C. C. A. 558. The defendant Killifer was employed by the Philadelphia Ball Club, and his contract contained an option to the Club to reengage him at a sa...

Sec. 1428. Inadequacy Of Consideration: If the consideration for a promise is so inadequate as to warrant the conclusion that the nature of the bargain cannot have been fairly understood, specific performance will be denied;28 especially wh...

Sec. 1429. Public Policy: If a contract is illegal or opposed to public policy, specific performance is obviously improper, and it is possible that specific performance may be opposed to public policy, though a recovery of dam...

Sec. 1430. Completeness Of Relief: At least in the enforcement of affirmative promises a court of equity usually deems it neither wise nor just to enforce one or more of such promises in a contract unless it can enforce all of the cont...

Sec. 1431. Exceptions To The Rule Of Complete Relief: There are some exceptions to the general rule that the decree must completely dispose of the contract between the parties. Cases where specific performance of part of a contract is given with damages ...

Sec. 1433. Rule Of Mutuality As Generally Stated: There is nothing in the law of specific performance which has given rise to so much confusion as the rule requiring mutuality in order that the plaintiff shall be entitled to specific performance. The...

Sec. 1434. Ames's Criticisms Of The Rule As Generally Stated: In an illuminating article on the subject,63 Ames objects to the rule as generally stated for the reason that the truth of the following eight propositions, each one of which is at variance with the ...

Sec. 1435. Contracts Voidable For Fraud Or Defective Title: Where one party to a contract has been guilty of fraud, he cannot enforce the contract either at law or in equity unless it has been ratified after discovery of the facts by the other party.73 Such a ...

Sec. 1436. A Vendor With An Incomplete Title May Be Compelled To Convey: As has been seen, a vendor who is not able to convey a perfect title, or whose ability to perform is deficient in some particular, can, nevertheless, enforce a contract specifically with compensation ...

Sec. 1437. A Contract May Be Enforced Though The Plaintiff Has Not Satisfied The Statute Of Frauds: It is the generally established law that a memorandum of a contract within the Statute of Frauds if signed by the party to be charged, though not signed by the other party, makes the contract enforcea...

Sec. 1438. Contracts With Infants: An infant is not allowed to enforce a contract specifically, because it is said the contract lacks mutuality.94 This is often thought to mean merely that since the adult could not have enforced the co...

Sec. 1439. Unilateral Contracts, And Partly Performed Bilateral Contracts: It is obvious that there is neither mutuality of obligation nor of remedy in a unilateral contract, and in a bilateral contract after performance by one party there necessarily ceases to be any such m...

Sec. 1440. True Doctrine Of Mutuality: Ames concludes his destructive criticism by the following suggestions:3 If, however, we examine the actual cases in which a plaintiff failed to obtain specific performance of a contract solely on ...

Sec. 1441. Options: An option is a term of business usage rather than of strictly legal nomenclature, and has frequently been used to include indiscriminately both binding conditional contracts and mere unsealed offers w...

Sec. 1442. Terminable Contracts: Equity will not enforce a contract specifically which the defendant has a right under the contract to terminate immediately, as a contract to enter into a partnership,14 or lease,15 terminable at the ...

Sec. 1443. Mutuality As A Reason For Giving Relief Where The Plaintiff Has An Adequate Remedy At Law: The ordinarily received rule of mutuality 22 is open to objection also when applied as a reason for giving a plaintiff relief which it is possible though not essential for equity to give In such a cas...

Sec. 1445. An Injunction As A Means Of Specific Performance: A court may order specific performance of a negative promise by enjoining breach of it; and if a contract consisted wholly of negative stipulations complete specific performance could be granted in th...

Sec. 1446. Contracts In Restraint Of Trade: The ordinary method of enforcement of covenants by a vendor in restraint of trade so far as they are legal is by injunction.41 37 Langdell, Survey Eq. Jur. 68. 38 In Fothergill v. Rowland, L. R....

Sec. 1447. Lumley V. Wagner: The chief problems in the enforcement by injunction of negative promises arise where the negative promise is only part of an outstanding bilateral contract consisting of dependent promises, not all of...

Sec. 1448. Negative Covenants May Be Implied: Every promise can be put either in a negative form or an affirmative form. Thus a promise to do any specific thing may be translated into a promise to refrain from doing anything else but that; and a ...

Sec. 1449. In England Only Express Negative Promises Are Enforced: The English court, though at first disposed to apply the doctrine of Lumley v. Wagner to negative promises necessarily implied from an affirmative undertaking,55 has subsequently declined to permit su...

Sec. 1450. Enforcement In The United States Of Negative Promises Correlative To A More Extensive Affirmative: There is felt by the courts to be a certain anomaly in granting the half way relief of an injunction . . . when the court is not prepared to enforce the performance to accomplish which indirectly is ...

Sec. 1460a. Summary Of Principles Governing Enforcement Of Negative Personal Covenants: A learned writer has thus summarized the results of the decisions: 72 Much of the difficulty in such cases grows out of confusing situations where a court ought not to enforce a covenant directly ...

Sec. 1451. Mutuality In Negative Contracts: There can be no doubt that Lumley v. Wagner76 and similar decisions violate the rule of mutuality as ordinarily applied to affirmative contracts, and it is important to fix the limits of the exception...

Sec. 1452. Modification Of The Rule Of Mutuality: In view of the negative contracts under consideration it is obvious that the rule of mutuality, suggested by Ames81 must be modified, and Professor Gilbert has suggested two possible modifications, wh...

Sec. 1453. Against Whom Specific Performance May Be Sought: Strictly a contract can be enforced either in law or in equity only against the party who entered into it. Only a promisor can be required to keep a promise; but where a promise relates to property eq...

Chapter XL. Rescission And Restitution For Breach Of Contract: Scope of the remedy............................................... 1464 Rescission as a remedy for breach of contract......................... 1455 Restitution of land conveyed.....................

Sec. 1454. Scope Of The Remedy: The normal redress for breach of contract is to give the injured party what will put him in as good a position as if the contract had been performed. The normal redress for a tort is to give what will...

Sec. 1455. Rescission As A Remedy For Breach Of Contract: The right of rescission and restitution generally exists as an alternative remedy where there has been repudiation or a material breach of a contract, and is most commonly exercised when the aggrieved...

Sec. 1456. Restitution Of Land Conveyed: If land has been conveyed and the purchaser fails to keep a promise made in consideration of the conveyance, the special right given by the vendor's lien is the only right the English seller has, othe...

Sec. 1407. Restitution Of Money Paid Or Claim Released: If a party to a contract has paid money and the other party has wholly failed to perform on his part, restitution may be had both in England6 and in the United States; and as will be seen from the cas...

Sec. 1458. Restitution Of Personal Property Transferred: If the title to personal property has been transferred, whether under a contract of exchange 15 or sale;16 the English law does not permit the transferror to rescind the transaction and revest the tit...

Sec. 1459. Recovery Of Value Of Services: If the performance rendered consists of services, there cannot ordinarily, from the nature of legal remedies, be actual restitution, but it is possible to give the equivalent in value under a common c...

Sec. 1460. Anything Received By Plaintiff Must Be Returned: If a contract has been partly performed by the party in default, the other party, at least if he has received any benefit from such part performance, cannot ordinarily rescind the contract according t...

Sec. 1461. Rescission For Breach Of Warranty. Recoupment And An Action Or Counterclaim For Damages Are: 33 The cases are instructive, however, on the question whether an owner to whose property valuable building materials have been attached as part of a structure can be regarded as having received a ben...

Sec. 1462. Authorities Divided: The English law clearly denies the right of rescission of an executed sale for breach of warranty.46 A diminishing number of the United States also deny it.47 But the majority of them allow it.48 And ...

Sec. 1463. The Buyer Must Put The Seller In Statu Quo: Though courts which allow rescission for breach of warranty do not regard the temporary use by the buyer necessary to show the defect as such a benefit to the buyer or such an injury to the goods as t...

Sec. 1464. The Buyer's Remedies Are Mutually Exclusive: It seems to be generally assumed that if a buyer elects the remedy of rescission for breach of warranty he is thereby precluded from bringing an action for damages and it has been so decided.65 The Un...

Sec. 1465. Where No Performance Has Been Rendered: While it is ordinarily the case that a party who seeks to rescind or avoid a contract because of a breach of contract or repudiation by the other party has performed at least in part and desires resti...

Sec. 1467. Breach Without Repudiation Sufficient: Question is more likely to be made whether breach of contract without repudiation justifies rescission than whether repudiation without actual breach is sufficient. There are many expressions, chiefly...

Sec. 1468. One Guilty Of The First Breach Cannot Rescind: A party who has himself been guilty of a substantial breach of contract cannot rescind the contract because of subsequent refusal or failure to perform by the other party.93 This principle, however, i...

Sec. 1469. Manifestation Of Election: As rescission is only an alternative remedy, and is in derogation of the contract, it is said that a party who wishes to avail himself thereof must manifest his election in some way.96 The may not, af...

Sec. 1470. Rescission Of Sealed Contracts: The right of rescission is frequently stated as if it were confined to simple contracts;6 and it is obviously inconsistent with the early common-law doctrines in regard to dissolution of sealed contra...

Sec. 1473. Recovery By One Who Has Broken His Contract: Few questions in the law have given rise to more discussion and difference of opinion than that concerning the right of one who has materially broken his contract without excuse to recover for such be...

Sec. 1474. Recovery For Defaulting Seller's Part Performance: In case the seller's obligation is either by its terms or by the buyer's permission performable in instalments it may happen that the buyer, not supposing the seller is going to be guilty of a breach ...

Sec. 1475. Recovery For Labor And Materials By Party In Default: The element of forfeiture in wholly denying recovery to a plaintiff who is materially in default is most strikingly exemplified in building contracts. It has already been seen 32 how, under the name o...

Sec. 1476. Recovery Of Money Paid By Party In Default: Where money has been paid under a contract by a party who subsequently makes default in the performance due from him the question of his right to recover so much of the payment which he has made as ex...

Sec. 1477, Recovery By An Employee In Default: Decisions have gone farther in allowing an employee who has performed a part of his contract of employment, for which no divisible portion of compensation is provided by the contract,42 to recover rea...

Sec. 1478. Measure Of Recovery In Actions For Restitution: If property or services given by the plaintiff to a defendant could be restored in specie as in the case of land, or had necessarily always the same value to both parties to the transaction...

Sec. 1479. Rescission And Restitution Where There Is No Liability On The Contract: The matter directly under consideration is the right of rescission as a means of recovering the value of what has been given prior to a breach of contract; but there are other cases where this or an a...

Sec. 1480. Cost To The Plaintiff Or Benefit To The Defendant: Where the plaintiff is in default under a contract, and is allowed a quasi-contractual recovery in order to prevent an unjust enrichment of the defendant and the infliction of a penalty upon the plain...

Sec. 1481. Criticism Of Proposed Tests: , The same court not infrequently in different decisions suggests measures of damages which are inconsistent with each other. The matter may be illustrated with actual figures. Let it be supposed that...

Sec. 1482. Benefit To The Defendant Is The Proper Test: The tests which are most commonly applied, and which have been criticised in reality allow the plaintiff to recover on the contract. For a court to assert that a plaintiff cannot recover on the contra...

Sec. 1488. How Benefit To The Defendant Is To Be Calculated: No doubt the contract price is important evidence of the value of the performance to the defendant. The cost of the labor and the materials is also important evidence, but by no means the only evidenc...

Sec. 1484. Defendant's Recoupment Or Counterclaim: Since the plaintiff has wrongfully broken his contract, the defendant may by recoupment or counterclaim get appropriate damages deducted from the plaintiff's recovery. If the measure of the plaintiff'...

Book VII. Invalidating Circumstances. Chapter XLI Fraud: Nature of invalidating circumstances................................. 1486 Definition of fraud................................................. 1487 When fraud renders a transaction void...........

Sec. 1486. Nature Of Invalidating Circumstances: Agreements may lack none of the essentials of a contract, and, if within the Statute of Frauds, may be in the form that the law requires, but, nevertheless, be subject to affirmative defences which re...

Sec. 1487. Definition Of Fraud: Fraud may become important either for the purpose of giving the defrauded party a right to sue the fraudulent person for damages in an action of deceit, or its equivalent, or to enable the defrauded p...

Sec. 1488. When Fraud Renders A Transaction Void: Fraud may induce a person to assent to do something which he would not otherwise have done, or it may induce him to believe that the act which he does is something other than it actually is. In the fi...

Sec. 1490. Materiality Of Representation: It is laid down in the cases that a misrepresentation must be material in order that the law may take notice of it as a fraud.13 12 The distinction was brought out in Levy tr. Cooke, 143 Pa. St. 60...

Sec. 1491. Matters Of Opinion: Two questions arise in regard to fraudulent statements of opinion. The first question involves the dividing line between statements of fact and opinion. The second question concerns the liability of o...

Sec. 1492. Illustrations In Contracts For. The Sale Of Goods: In contracts for the sale of goods the question whether a statement is one of fact or opinion will arise in regard to statements of the quantity, quality, or value of the goods; or statements in regar...

Sec. 1493. Illustrations In Contracts For The Sale Of Real Estate: The same principles are applicable to representations in sales of real estate as in sales of chattels. A statement by a vendor of real estate concerning his title, when stated as his conclusion from f...

Sec. 1494. Liability For Fraudulent Statements Of Opinion: There is a growing unwillingness on the part of the courts here as in the law of warranty to allow statements to be made without liability, which are calculated to induce, and do induce, action on the...

Sec. 1495. Matters Of Law: It is well settled that statements of domestic law though false and fraudulent do not generally constitute actionable fraud.48 And on this principle, a conscious misstatement of the meaning of certain...

Sec. 1496. Promises And Predictions: It is frequently said that a promissory statement cannot be the basis of an action for deceit; and a prediction of future events is at best a statement of opinion.55 It is undoubtedly true that failur...

Sec. 1497. Silence - General Rule: It has been said that there is no legal obligation on the vendor to inform the purchaser that he is under a mistake, not inmisstatement of fait. Edgington v. Fitzmauriee, 29 Ch. D. 459, per Bowen, L...

Sec. 1498. Silence As To Quality Of Goods Sold May Be Fraudulent: There are exceptions to the general rule that silence cannot amount to fraud. While it is nowhere held that collateral circumstances tending to enhance the value of the subject of the sale must be dis...

Sec. 1499. Other Instances Where Silence May Be Fraudulent: Active concealment of the facts, also, would be held fraudulent by some courts which would not hold mere silence sufficient, though it may seem difficult to make out an actual misrepresentation from a...

Sec. 1600. Rescission Is Allowable For Honest Misrepresentation: It is not necessary in order that a contract may be rescinded for fraud or misrepresentation that the party making the misrepresentation should have known that it was false. Innocent misrepresentation...

Sec. 1501. Liability In Damages For Honest Misrepresentation: Though the right to rescind for honest misrepresentation seems in a fair way to be generally accepted, other effects of such misrepresentation are not so easily dealt with. It is common enough in our ...

Sec. 1502. Early History Of Deceit: The word deceit in the old writ of deceit, and in the action on the case for damages for deceit, based on the earlier writ, seems to have carried to the minds of early lawyers no more definite meani...

Sec. 1503. Warranty Of Title: The early authorities on the law of warranty which furnished the foundation for the decision of Pasley v. Freeman have also been the basis for the subsequent development of the law of warranty, and in...

Sec. 1505. Warranty May Be, But Need Not Be Based On Contract: There can be no doubt now, of course, that a seller may promise, in consideration of the purchase of goods from him, that he will be answerable for their present, or, indeed, for their future conditio...

Sec. 1506. Illustrations: To any one who still inclines to accept as fact the fiction of a contract where a warranty is based on a seller's misrepresentation of the quality of his goods, the argument may be put in this way. If...

Sec. 1607. Warranty By An Agent Of His Authority: Entirely analogous to the law of warranty in the sale of goods is the warranty which the law imposes upon an agent that he is authorized to act as such. The agent either expressly, or by necessary imp...

Sec. 1608. Estoppel In Pais: Another doctrine which must be considered in this connection is that of estoppel in pais. This doctrine, as now understood, precludes one who has made positive statements of fact to another, in relian...

Sec. 1509. Actions For Damages For Misrepresentation: Even in actions in form claiming damages for deceit there is much authority to support the proposition that a defendant may be liable for honestly misrepresenting facte in regard to which he might rea...

Sec. 1510. Policy Of Imposing Liability For Innocent Mistakes: The use of the words fraud and deceit have probably-exercised an unfortunate influence in the development of the law on the subject. These words naturally import consciously wood v. Carlton, 162 A...

Sec. 1511. Limitation Of Liability For Honest Misrepresentation: The precise limits of liability in damages for honest misrepr-sentation are not fixed at the same place by all the courts which hold that such liability may exist. Two qualifying principles may claim ...

Sec. 1512. Negligence As A Basis Of Liability: The second qualifying principle suggested is that no liability should exist if there was reasonable ground for believing that the statements made were true. This amounts in effect to denying liability...

Sec. 1513. Conscious Error Without Fraud: In England the courts have gone very far in consequence of the doctrine that a guilty state of mind is a necessary element in order to make the defendant liable. Both in Deny v. Peek 53 and in Angus v...

Sec. 1614. Argument Based On Measure Of Damages: It may properly be urged that the measure of damages in an action for deceit differs from that applicable to actions for breach of warranty or to actions based on estoppel. In an action of tort for de...

Sec. 1515. Action In Reliance On False Impression: No legal wrong is caused by false and fraudulent representations unless they are acted upon. And a person induced by false representations to do an act which it was his duty to do, has had no legal ri...

Sec. 1516. Unjustifiable Reliance: It is no doubt true that relief is denied in many cases of fraudulent representations where the representations were such that no reasonable person ought to have relied upon them.66 It is on this grou...

Sec. 1517. Fraud On The Seller By Impersonation: A method of fraud upon the seller not infrequently committed is for a fraudulent buyer to obtain goods by inducing the seller to believe that the sale is made to another person having good credit. If ...

Fraud On The Seller By Impersonation. Continued: 76The leading case illustrating this point is Cundy v. Lindsay, 3 A. C. 450. In this case it appeared that one Alfred Blenkarn hired a room which had side windows on Wood street. He wrote an order to ...

Sec. 1518. Misrepresentations By Third Persons: Fraudulent misrepresentations inducing the person to whom the misrepresentations are addressed to buy or sell property or enter into a contract with some one other than the maker of the representation...

Sec. 1519. Misrepresentations Indirectly Made: Fraudulent misrepresentations indirectly reaching and influencing persons other than the one to whom they were directly addressed, may have the same effect as if made directly to the person influenced...

Sec. 1520. Representations Of Solvency: A common form of fraud upon the seller is a misrepresentation of the buyer's solvency or ability to pay for the goods, by which the seller is induced to give credit to the buyer. Such representations ...

Representations Of Solvency. Continued: S.) 245; Powell p. Bradlee, 9 G. A 3. 220; Dow v. Sanborn, 3 Allen, 181; Watson v. Silsby, 166 Mass. 67, 43 N. E. 1117; Ayera v. Farwell, 196 Mass. 349,82 N. E. 35; Phinney v. Friedman, 224 Mass. 531,...

Sec. 1522. Fraud On A Buyer: Fraud upon a buyer will generally consist of some misrepresentation in regard to the character of the property or in regard to the title, quantity, or value. Misrepresentations as to quantity and valu...

Sec. 1623. Remedies Of Defrauded Party: Although relief may be obtained by a defrauded party to a contract in a variety of ways, such relief is always based on one of three general remedies which are open to the defrauded party: (1) A right...

Sec. 1524. Action Of Damages For Deceit: The right of one who has Buffered damage by fraudulent representations to bring an action for deceit needs no citations of authorities. In order to maintain such an action where benefit has been recei...

Sec. 1525. Rescission And Restitution - Reformation: The alternative remedy of rescission and restitution is in its origin equitable, though now relief can generally be obtained at law. If the defrauded party has parted with nothing, but has merely ente...

Sec. 1526. Time Allowed For Election Of Remedies: It is generally said that a defrauded party must elect whether he will affirm the fraudulent transaction or rescind it. But a transaction though induced by fraud is not on that account void, it is onl...

Sec. 1627. Acts Manifesting Election: The defrauded party may lose his right of rescission by any act done after discovery of the fraud which indicates a willingness to allow the transaction to stand, such as the acceptance or demand of a...

Sec. 1528. Exclusive Character Of Remedies: Though the cases are in some conflict, it seems clear on principle that it is an election to affirm the contract to bring an action for deceit. Such an action can be based only on the assumption that ...

Sec. 1529. Restoration Of Consideration: In a suit in equity for rescission a plaintiff who has received consideration commonly offers in his bill to restore the consideration, and whether such an offer is made or not the decree in such a su...

Sec. 1530. Exceptions To The Rule: This rule, however, is subject to the exception that if the consideration was worthless it need not be rettirned.56 And one who attempts to rescind a transaction on the ground of fraud, mistake or oth...

Sec. 1531. Rescission Allowed Only Against Fraudulent Person: As has already been seen,71 fraud may sometimes be of such a character as to preclude assent to a bargain by the defrauded person. If goods are obtained in this way no property passes to the fraudulen...

Sec. 1532. Double Employment Of Agent: If a party enters into a contract through an agent who was also secretly acting for the other party, the contract is not only unenforceable specifically against the principal,78 but, on the ground of ...

Sec. 1533. Contracts Between A Corporation And Its Officers: In spite of the principle stated in the preceding section, it is settled that directors may contract with agents or employes of their corporation, who are likewise directors, and that, though always ...

Sec. 1534. Fraud As To Creditors: A bargain may be vitiated not only by fraud of one of the parties aimed against the other, but by the fraud of one or both aimed against the creditors of one of them. Such transactions generally relat...

Chapter XLII Mistake: Effect of mistake on contracts....................................... 1535 Confusion concerning elements of contract............................ 1536 Elements of contract in equity.................

Sec. 1535. Effect Of Mistake On Contracts: All writers who deal with the topic of mistake agree that there is great confusion of thought in discussions of the subject, but they attribute this confusion to different causes.1 The chief causes th...

Sec. 1536. Confusion Concerning Elements Of Contract: If mental assent is a necessary element of contract, and if offer and acceptance are important merely as proving this mental assent, as the ultimate fact to be established, a failure of either party t...

Sec. 1537. Elements Of Contract In Equity: It is in the decisions of courts of equity that expressions are most frequently found favoring the subjective theory. But though in a few cases promises are unquestionably enforced by equity which are...

Sec. 1538. Confusion Between Void And Voidable Transactions: Where a transaction concerns the transfer of title or possession from one party to another, the distinction between a void and a voidable transaction is readily brought to the notice of any one dealin...

Sec. 1539. Distinction Between Transfer Of Title And Enforceability Of Contract: It is impossible to transfer ownership to something which does not exist. Accordingly if the parties to an agreement bargain for a transfer of title to supposedly specific goods under some mistake, th...

Sec. 1641. Effects Of Mistake: The effect of mistake upon a bargain may be various: 1. A mistake may be such as to prevent any real expression of agreement, in which case the transaction is void. 2. There may be an expression of ag...

Sec. 1542. Remedies For Mistake: The legal consequences of mistake in contractual transactions when it has effect but does not totally prevent the formation of a contract may be classified under three headings: 1. Reformation of t...

Sec. 1644. Mistake To Justify Rescission Must Relate To A Fundamental Assumption: It is often said that a mistake in order to justify rescission must relate to the intrinsic nature of the bargain; and, in distinction from this, a mistake in regard to a collateral matter or in regar...

Sec. 1545. Mistake In The Formation And Mistake In The Performance Of A Contract: A mistake may arise in the original agreement of the parties, or in the performance of a contract as to which no mistake existed. Thus, when making their original bargain, the parties either may have ...

Sec. 1546. Classification Of The CIVIL Law: The Civil law, starting from the subjective standpoint that the existence of a contractual obligation or a transfer depends upon the will of the actor instead of on the natural reliance of one party t...

Sec. 1647. Reformation Of Mistake In Expression Of Contract: Where a written agreement is not in conformity with the actual intention of the parties in a material matter, a court of equity will reform the writing in accordance with the actual agreement if innoc...

Sec. 1548. Reasons And Limits Of Reformation: It is often said that in the exercise of this jurisdiction a court of equity is merely substituting the real transaction between the parties for the apparent one, but the explanation is inadequate. Ev...

Sec. 1549. Reformation Can Only Make A Writing Express What Parties Intended Should Be Written: The province of reformation is to make a writing express the bargain which the parties desired to put in writing. Agreements of which they did not desire written expression will not be put into writin...

Sec. 1660. Reformation Of Conveyances: The commonest illustrations of reformation concern conveyances. Where a deed conveys a different or larger estate or right than was intended, and both parties shared an intent as to the estate which s...

Sec. 1551. Reformation Of Releases: A release though general in terms will be reformed so as to cover merely the right with regard to which the parties were dealing and exclude rights of which they were ignorant.61 This principle has so...

Sec. 1552. Effect Of Parol Evidence Rule And Statute Of Frauds On Right Of Reformation Of Executed Transactions: The right of reformation wherever allowed is necessarily an invasion or limitation of the parol evidence rule, since when equity reforms a writing it enforces an oral agreement at variance with the wr...

Sec. 1553. Executory Contracts In England: Where reformation has been sought of an executory contract, the English courts have felt insuperable difficulty due not only to the Statute of Frauds (which happened to be applicable in nearly all the...

Sec. 1554. Executory Contracts Which Are Not Within The Statute Of Frauds In The United States: In the United States the parol evidence rule is no objection to reformation, and an executory contract may undoubtedly be reformed when this does not infringe on the Statute of Frauds. Thus where an i...

Sec. 1555. Executory Contracts Which Are Within The Statute In The United States: Even where an executory contract relates to land and is within the Statute of Frauds, many American authorities allow its reformation whether a deed has subsequently been executed in conformity with t...

Sec. 1556. Voluntary Or Illegal Writings: It may be supposed that a voluntary conveyance or obligation under seal does not express the intention of the donor, either because it gives too much or gives too little. If it gives more than the don...

Sec. 1667. Rescission: Where reformation is possible, it is generally the only remedy permissible, since the mistake of the parties related to their expression only, and to decree rescission and freedom from all bond would ...

Sec. 1558. Mistake As To The Person Contracted With: As has been seen, an offer can be accepted only by the person to whom it is addressed;90 and a transaction, therefore, where the parties have not agreed to contract each with the other is void; but th...

Sec. 1559. Error In Regard To An Object To Which The Contract Relates: When the performance of a contract requires the existence of a specific thing, and at the time the contract is made the thing does not exist, it is obvious that completion of the transaction is imposs...

Sec. 1560. Non-Existence Of Goods Sold: The Uniform Sales Act94 states the rule applicable to an attempted sale of non-existent goods. Section 7.-[DESTRUCTION OF GOODS SOLD.] (1.) Where the parties purport to sell specific goods, and the...

Sec. 1561. A Sale Of Specific Goods Is Void If Goods Not In Existence: In regard to the correctness of the principle of law stated in the first subsection of the statute just quoted there can be no doubt where the statute has not been enacted as well as where it is in fo...

Sec. 1562. Partial Destruction Of The Goods Prior To The Sale. The English Sale Of Goods Act Makes No Provision In Regard: 1 Taylor v. Caldwell, 3 B. & S. 826. See also The Tornado, 108 U. 8. 342, 2 S. Ct. 746, 27 L. Ed. 747; Arthur v. Blackman, 63 Fed. 636; Fresno Milling Co. v. Fresno C. & I. Co., 126 Cal. 640, 59 Pac. ...

Sec. 1563. Inferior Quality Of The Goods: A more troublesome case arises where none of the goods are totally destroyed but ally or a material part of them, are inferior in condition to what the parties supposed when the bargain was made. In r...

Sec. 1564. Rules Of The CIVIL Law: The question of the destruction of the subject-matter of the sale has been much discussed in the Civil law, and the rules of the Roman Law have been thus summarized: If the thing which it has been...

Sec. 1565. Mistake As To Title To Personal Property: As the seller of personal property impliedly warrants his title,18 unless the buyer clearly agrees to take merely such title as the seller may have, it is seldom necessary in jurisdictions where resci...

Sec. 1566. Mistake As To Existence Or Title To Real Estate: In contracts to sell real estate the contract is construed unless a contrary intention is expressed, as binding the seller to convey a good title; 22 but when an actual conveyance has been made there ...

Sec. 1(67. Mistake As To The Existence Of Ore: In mining leases the lessee commonly agrees to pay a royalty varying with the amount of ore mined and also agrees to mine annually at least a certain quantity. It is a question of construction whether...

Sec. 1568. Mistake As To Insurance Risk: As an insurance premium is paid on the assumption that the insurer is assuming a risk, the premium may be recovered if no risk attached, as where in marine insurance the plaintiff had no goods on boar...

Sec. 1589. Collateral Mistake Generally Immaterial: It is generally said that mistake as to a collateral matter has no effect upon a contract. The boundaries of such a rule are not very exactly fixed, but it means that where the persons and things to w...

Sec. 1570. When Collateral Mistake Is Material: Mistake concerning collateral matters may sometimes, however, afford ground for relief. Where a mistake as to the quantity, quality, or characteristics of the subject of a bargain is due to a mutual m...

Sec. 1671. Mistake As To Area Of Land: Another large group of cases should be noticed in connection with collateral mistake. Where a conveyance of land is for a gross price, though the land was supposed by the parties to contain a certain ...

Sec. 1572. Mistake As To The Character Of Money Or Securities: If payment is made in counterfeit money, the creditor may treat the payment as a nullity, and recover upon his original claim.54 This is true of foreign money as well as domestic.55 The counterfeit bi...

Sec. 1573. Unilateral Mistake: In two classes of cases mistake of one party only to a contract undoubtedly justifies affirmative relief as distinguished from a mere refusal to enforce the contract specifically against him: Bank ...

Sec. 1574. Recovery Of Money Paid Under A Mistake Of Fact: One who by error in computation,74 or by mistake of any fact,75 pays a real or supposed creditor more than is his due, or pays a debt previously discharged, may recover the over-payment; and generally...

Sec. 1575. Recovery Of The Value Of Goods Or Services Rendered Under A Mistake: The same principle of justice which requires.the return of money paid under a mistake, requires that other benefits received under a similar mistake should likewise be restored.82 If the transferee st...

Sec. 1576. Demand: If the defendant knew that the benefit which he received was given under such a mistake as would justify its recovery, he is liable without demand of restitution first being made upon him;85 and it se...

Sec. 1577. Unilateral Mistake As To Contents Of Writing: Where the signer of a writing has made an innocent mistake without carelessness, whether induced by fraud or not, the writing is not his expression, and there is no contract.89 But if a man acts negli...

Sec. 1578. Relief Sometimes Allowed For Unilateral Mistake In Other Cases: As to other cases than those referred to in a preceding section,94 the expressions are numerous that mistake, in order to justify relief, must be mutual or the error of one party must be known to the ...

Sec. 1579. Criticism Of Relief For Unilateral Mistake: It is obvious that a doctrine which permits the rescission of a contract on account of unilateral mistake approaches nearly to a contradiction of the objective theory of mutual assent in the formation...

Sec. 1580. An Executed Or Partially Executed Transaction Will Not Be Rescinded For Unilateral Mistake: The same principle that prohibits recovery of money paid after the defendant has changed his position, makes it clear that whatever (equity there may be in favor of one who has made a unilateral mista...

Sec. 1581. Mistake Of Law: There is no portion of the law of mistake more troublesome than that relating to mistake of law. It is impossible to coordinate the cases so as to produce satisfactory results, because the rule itself...

Sec. 1582. General Statements Deny Relief For Mistake Of Law: Subject to qualifications, hereafter considered, the statement is generally made that no relief will be given for a mistake of law unaccompanied with any mistake of fact,13 and especially, it is still...

Sec. 1583. Mistake Of Law In The CIVIL Law: The classical Roman law denied relief on account of mistake of law except in the case of minors and women.31 But in most the ground of decision and sometimes merely in discussion or argument, it has b...

Sec. 1584. Exceptions To The Rule Denying Relief For Mistake Of Law: The formula that mistake or ignorance of law excuses no one is often used where the lack of relief is due to a more fundamental difficulty which would likewise have precluded relief if the mistake had...

Sec. 1685. Mistake Of Law As To Meaning Of Instrument Is Ground For Reformation: Where a written instrument fails to express the intention of the parties because of a mutual mistake as to the construction or legal effect of the words of the writing, though there is no misapprehens...

Sec. 1686. Limits Of Possibility Of Reformation For Mistake Of Law: The desirable rule governing reformation is that if the writing actually executed does not contain all that the parties agreed that it should contain, it will be reformed 41 whether the reason why it ...

Sec. 1588. Mistake Of Matter Of Law Affecting The Situation Antecedent To The Bargain: If the only mistake of the parties related to some matter, either of fact or law in the situation of affairs prior to the execution of the writing in question, making it desirable or undesirable to en...

Sec. 1689. Mistake As To Antecedent Private Rights: An exception has been made to the rule denying relief for mistake of the law governing a situation prior to the bargain, where the mistake relates to the private rights of the parties as distinguished...

Sec. 1590. Money Paid Tinder A Mistake Of Law By A Public Officer Or To An Officer Of The Court: Payments of public money made by officials made under a mistake of law may be recovered.52 Though no such broad principle is applicable conversely where money is paid to a public officer, a court will...

Sec. 1591. Mistake Of Law Induced By The Other Party: If a mistake of law is induced or encouraged by the misrepresentation of the other party or even if it is perceived by the other party and taken advantage of by him, it is in equity, at least, justifi...

Sec. 1594. Prompt Election And Restoration Of The Status Quo: As has been seen, a transaction cannot be rescinded on account of fraud,60 or on account of breach of warranty,61 without prompt election and restoration of the status quo by the party seeking resciss...

Sec. 1596. Change Of Position Bars Recovery Of Money Paid Under A Mistake: If one to whom money has been paid under a mistake has so changed his position in reasonable reliance on his right to the payment as to be unable to restore it without a detriment greater than he woul...

Sec. 1596. Negligence And Laches: It is frequently said that equity will not reform or rescind a contract if the petitioner has been guilty of negligence, or at any rate of gross negligence.70 That no such principle can be laid down a...

Sec. 1597. Burden Of Clear Proof Is On Complainant: Though equity will not permit the parol evidence rule to prevent it from granting relief for mistake, the purpose of a written contract is to furnish a record of the terms of the agreement of the pa...

Sec. 1598. Law And Equity; Rescission At Law: Rescission and reformation are generally thought of as remedies appropriate to courts of equity. There are, however, obvious limitations to the power of equity to grant relief. Equity will entertain a...

Sec. 1599. Reformation At Law: Even the power of equity to reform contracts has been to some extent borrowed by courts of law, in fact, though not in name; for the result attained by a court of equity may frequently be reached by a...

Sec. 1600. Accidental Loss Or Destruction Of Writings: Since profert of a sealed instrument is not now usually required as a condition of the plaintiff's recovery, the loss or destruction of the instrument generally has merely the effect of a loss of prim...

Chapter XLIII Duress: Early development of law of duress.................................. 1601 Undue influence in equity........................................... 1602 Gradual enlargement of duress....................

Sec. 1601. Early Development Of Law Of Duress: Under the name of duress, there have long been included what early lawyers classified under the two headings: (1) duress - that is, imprisonment - and (2) menaces, that is, threats of imprisonment or ...

Sec. 1602. Undue Influence In Equity: Equity established no rule defining the exact amount of compulsion which should justify the avoidance of a contract or conveyance; but . Any influence brought to bear upon a person, entering into ...

Sec. 1603. Gradual Enlargement Of Duress: Under the influence of increasing liberality of legal thought aided by the example offered by courts of equity, the definition of duress in courts of law has been much enlarged. It has been said dure...

Sec. 1604. Consent Must Be Coerced: Whatever definition be adopted, it is clear that in order that a transaction may be avoided on account of duress or undue influence, it must appear that the consent of the party seeking to ...

Sec. 1606. Threats Need Not Be Such As To Affect A Brave Man: The statements in the early books assert that in order to constitute duress by threats, the threats in question must be such as to put a brave man in fear.13 Later, the standard of courage was somewha...

Sec. 1606 Pressure Must Be Wrongful; Threatened Suit: One element of the early law of duress continues to exist, however the boundaries of the defence may be extended. The pressure must be wrongful, and not all pressure is wrongful.17 The law provides ce...

Sec. 1607. Abuse Of Lawful Means: Means in themselves lawful must not be so oppressively used as to amount to an abuse of legal remedies. Though attachment is in itself lawful, if an attachment is excessive, or of perishable property,...

Sec. 1608. Neither Persuasion Nor Pressure Of Circumstances Is Duress: Since there is no impropriety in the use of such means, it follows that suggestion, argument, entreaties, advice, and persuasion, unless there is some special relation between the parties giving one a...

Sec. 1609. Duress By Imprisonment And By Threats Of Imprisonment: Though the common law distinguished duress and menace, or as it was later phrased duress by imprisonment and duress by threats, there is no logical distinction worth preserving. Imprisonment operates ...

Sec. 1610. Duress By Imprisonment For Debt: Confusion has been caused in regard to duress by imprisonment by a double meaning of the word lawful. Lawful imprisonment, it is said, cannot amount to duress, and it is true that if imprisonment is...

Sec. 1611. Duress By Imprisonment For Crime: Where a person is imprisoned for crime his situation must be distinguished from that where he is imprisoned for the debt or liability to which the settlement which he is induced to make relates. If th...

Sec. 1612. Threat Of Criminal Prosecution: A threat of criminal prosecution is not in terms a threat of imprisonment but in effect it is ordinarily a threat of imprisonment, and, also irrespective of whether the prosecution is likely to be fol...

Sec. 1613. Arguments That Threats Of Criminal Prosecution May Not Be Duress Are Unsound: Neither of the ideas stated in the preceding section will bear examination. The first - that imprisonment is not sufficiently imminent is based on early common-law definitions of duress which are gene...

Sec. 1614. Illustrations Showing That Threats Of Criminal Prosecution May Be Duress: The unsoundness of the arguments denying that threats of well-founded prosecution can be duress - at least unless a warrant has issued and immediate arrest is probable, will be evident from considerin...

Sec. 1615. Reason Why Many Courts Have Refused To Avoid Transactions Made Under Threats Of Prosecution: The truth seems to be that in the cases where a settlement coerced by means of threatened prosecution has been held not to amount to duress, no more than a fair settlement was obtained. One who had mi...

Sec. 1616. Even A Reasonable Settlement Obtained By Threats Of Prosecution Should Be Voidable: In spite of the arguments advanced in the preceding section, it seems better to hold that where anything other than a satisfaction of the precise civil obligation under which a criminal rested is obta...

Sec. 1617. Duress Of Property: Under the early common-law rule fear of pecuniary or property loss could not amount to duress,56 but under the enlarged doctrine to which modern courts have tended, it is held that duress of property ...

Sec. 1618. Illustrations Of Duress Of Property: Analogous to cases of the detention of goods are cases where the assertion of a lien upon real property has been used as a means of coercion, though no lien existed or if it existed should have been d...

Sec. 1619. Coercion By Judgment: Where a plaintiff has recovered judgment and execution has been issued, or may be immediately issued, a payment or settlement made by the defendant in satisfaction of the judgment is obviously coerced...

Sec. 1620. Effect Of Adequate Legal Remedy: Analogous to the idea that threats must be such as to terrify a man of ordinary firmness is the principle not infrequently stated that if the law provides adequate redress or compensation for the inju...

Sec. 1621. Duress By Threats To Injure A Third Person: The early common law did not regard as duress the mental pressure exerted by imprisonment or threats to injure another. It was said that a servant could not avoid a deed made because his master was su...

Sec. 1622. When Duress Makes A Contract Void: Duress, like fraud and mistake, may completely prevent the mutual assent necessary for the formation of a contract or sale, or it may be merely a ground for setting aside a bargain because the express...

Sec. 1623. Generally Duress Makes A Contract Voidable: Save in exceptional cases referred to in the previous section, duress renders the transaction voidable. It is not necessarily a tort in itself, as is fraudulent misrepresentation,87a but operates only...

Sec. 1624. Duress Does Not Exclude Capacity To Contract: It is not infrequently stated as the reason why an instrument obtained under duress may be avoided, that the duress has deprived the person subjected to it of the capacity to consent, and that any wri...

Sec. 1625. By Whom Duress Must Be Exercised: Originally it seems that the common law regarded simply the situation of the party coerced, and held a transaction made under duress voidable, though the duress was not exercised by the grantee or cov...

Sec. 1626. Protest: Frequently payments are made under protest as a means of indicating that coercion has been used, and it is always desirable to make protest when it is intended to assert later a claim to recover the p...

Sec. 1627. Relationship Giving Dominance To One Party: A relationship between parties to a transaction which tends to give one dominance over the other may be an important element in determining whether duress was exercised. And courts of equity have esta...

Chapter XLIV. Illegal Agreements - Contracts In Restraint Of Trade: Classification of illegal agreements.................................... 1628 Variation of public policy........................................... 1629 Effect of illegal agreements................

Sec. 1628. Classification Of Illegal Agreements: As the law forbids the actual performance of certain acts because opposed to social welfare, so it regards as obnoxious various executory agreements. The common law has developed on this su...

Sec. 1629. Variation Of Public Policy: In a recent English decision 3 the fundamental principles guiding the court were thus stated: The question of public policy may well give rise to a difference of judicial opinion. Public policy, it w...

Sec. 1630. Effect Of Illegal Agreements: It is commonly said that illegal contracts and agreements are void. This statement, however, is clearly not generally accurate. It is true that a court could only under very exceptional circumstances ...

Sec. 1630a. When Illegality Must Be Pleaded: A desirable flexibility of the law frequently demands the construction here contended for in ways not always easily foreseen. Thus it is generally true that illegality if of a serious nature need notf...

Sec. 1631. Illustrations Of Recovery By Innocent Plaintiffs: That the principle stated in the preceding section is that upon which relief is denied is proved by the fact that if the plaintiff is wholly innocent recovery is allowed though the contract is illegal...

Sec. 1633. Contracts In Restraint Of Trade: The topic of contracts in restraint of trade includes a large variety of agreements. Any contract which purports to limit in any way the right of either party to work or to do business, 55 Am. Rep....

Sec. 1634. Early Law: The early law contains abundant recognition of the evils of monopoly. In general the monopolies which excited attention were not sought or obtained by contract but directly or indirectly by grant or c...

Sec. 1635. Reasons For Holding Restraint Invalid: The reasons given in this examination in the case just referred to for the prohibition against general restraints are thus stated after a consideration of the early decisions: The true reasons of ...

Sec. 1636. Reasonableness Of Restraint: It is everywhere agreed that in order to be valid a promise imposing a restraint in trade or occupation must be reasonable. The question of reasonableless is for the court, not the jury;43 and in cons...

Sec. 16s7. Statement By Taft, J., Of Permissible Restraints: In a leading case decided by the Circuit Court of Appeals,49 Taft, J., thus summarized what the law permits: Covenants in partial restraint of trade are generally upheld as valid when they are ag...

Sec. 1638. Partial Restraints Are Valid; Limit Of Time: Until recent times the law sought to fix by somewhat technical rules the validity of contracts restraining the exercise of a trade or profession; especially the question whether a restrictive promise ...

Sec. 1639. Limits Of Space: In England undoubtedly the same result has been reached in regard to covenants unrestricted in space. There it is held that unlimited space does not necessarily involve the invalidity of a promise; 57...

Sec. 1640. Contract Implied On Sale Of Good Will: As a preliminary to considering what contracts may be made on the sale of a business, it is desirable to observe what obligapartner on dissolving partnership may make a similar contract limited to a c...

Sec. 1641. Sale Of Business With Restrictive Covenant Is Valid: The importance of enabling the owner of a business to dispose of it and the consequent necessity of allowing him to secure to the purchaser the value of the business which is sold by engaging not to d...

Sale Of Business With Restrictive Covenant Is Valid. Continued: If a sale of the business is made to one who previously was not a competitor, it is obvious that there is no diminution of competition by the sale, and the promise accompanying it. There is less compe...

Sec. 1642. Sale Or Lease Of Property With Restrictive Covenant: The seller or lessor of property as distinguished from a business or good will may by a restrictive promise reasonably limited agree to refrain from himself engaging in a business or from disposing of...

Sec. 1643. Promises Ancillary To Contracts Of Employment: Courts are less disposed to sustain an agreement which forms part of a contract of employment to refrain from subsequently engaging in competitive occupation than where a similar agreement is attached...

Sec. 1644. Partners May Make Restrictive Promises: The contract of a partner not to compete with the partnership either directly or indirectly is not opposed to public policy; 94 but such an agreement must be ancillary to the contract sales of good wi...

Sec. 1646. Agreements For Exclusive Dealing: A contract to sell within a certain territory goods of a specified kind to, or through the agency of, one person only, generally is valid;1 but it is otherwise if such a contract is part of a scheme w...

Agreements For Exclusive Dealing. Continued: tying clauses which make it a condition of the lease that the lessee shall use only materials and machinery of the lessor's manufacture have also been upheld.7 Sometimes the desired result is sought...

Sec. 1646. Contracts Not To Divulge Trade Secrets Are Valid: The law recognizes a right of property in trade secrets.15 As such property loses its only value if the secret is disclosed, any one who acquires knowledge thereof in a confidential capacity, as that ...

Sec. 1647. Patented And Copyrighted Articles: The owner of a patent acquires a legal monopoly. He needs no contract or combination in restraint of trade to make his monopoly complete and secure. He may keep his invention out of use altogether,25 ...

Sec. 1648. Agreement Among Competitors To Limit Competition Or Maintain Prices: Numerous agreements have been made, especially prior to 1900, by competing firms or corporations having for their object fixing prices, pooling profits, limiting output, controlling supply, or dividin...

Sec. 1649. Limitations On Resale Prices: An attempt has frequently been made by manufacturers to maintain the price of the manufactured article by making a series of contracts with jobbers/to whom the manufactured goods are sold, that they s...

Sec. 1650. Recovery Of Agreed Payment For Performing Restrictive Promise: So harmless did contracts in restraint of trade appear to the English courts in the nineteenth century, except for the oppression of the promisor, that if an agreement, invalid because imposing an unr...

Sec. 1661. Public Service Corporations: Public service companies are more strictly limited than others in entering into contracts in restraint of trade, because of their duty to give equal service to the public. They can make no contracts i...

Sec. 1652. Agreements Unduly Restricting Personal Liberty Are Invalid. ': One of the prominent reasons for holding contracts invalid which restrict the right of a party to carry on trade or business, is the hardship upon him, and though in most cases this reason is combined...

Sec. 1653. Any Contract May Be Rendered Invalid If Tending To Produce Monopoly: A fundamental objection of public policy to contracts in unreasonable restraint of trade is their tendency to produce monopoly and enhanced prices; and any contract which is part of a scheme to produc...

Sec. 1664. Trade Union Agreements; English Law: The largest element of cost in most economic production is that of labor. It is for the interest of employers to pay as little as possible, and for the interest of employees to obtain as large pay as ...

Sec. 1655. Trade Union Agreements; American Law: In the United States, if the logic of early cases were followed, there can be no doubt that the agreement of members of a trade union with one another would be invalid as in restraint of trade. The pr...

Sec. 1666. Effect Of Trade Union Being In Restraint Of Trade: The validity of the agreement binding members of a union does not ordinarily become of direct importance. Unions have other ways of making their members comply with what they undertook on becoming mem...

Sec. 1657. Anti-Trust Acts; Sherman Act: The prohibitions of the common law against contracts in restraint of trade have in most jurisdictions been reinforced by statutes, which are generally aimed not only at contracts, but at all combinati...

Sec. 1658. Construction Of The Sherman Act: The statute being in terms limited to restraint of interstate or foreign trade or commerce, was at first held not to cover a combination of manufacturers; 3 but this holding was later disregarded, and...

Construction Of The Sherman Act. Continued: Mr. Justice Harlan, though concurring in the decision of the two cases, dissented from the test adopted by other members of the -court and adhered to the view that any restraint be said that so far as...

Sec. 1659. Divisibility Of Promises Imposing Excessive Restraint: Contracts containing promises unlawful because of too extended restrictive effect have not been held so unlawful in their general purpose as to invalidate the whole transaction of which they were a pa...

Sec. 1660. Partial Enforcement Of Promise Indivisible In Terms: If a sharply defined line separated a restraint which is excessive territorially from such restraint as is permissible, there seems no reason why effect should not be given to a restrictive promise in...

Sec. 1661. Collateral Effects Of Illegal Combinations: Though an agreement forming an integral part of a plan to restrain trade unreasonably is unenforceable, the parties are not thereby deprived of ordinary civil rights, therefore they may enforce contra...

Sec. 1662. Trust Laws In Foreign Countries: As the proper attitude of the law towards industrial agreements and combinations in restraint of trade, depends upon their economic effect, the experience of other nations, as illustrated by their law...

Sec. 1663. Contracts Not To Bid At Auction: It is not permissible for intending buyers at auction or other competitive sales to make an agreement for a consideration, that only one of them shall bid in order that the property may be knocked dow...

Sec. 1664. Puffing: Secret bidding by or on behalf of the seller may have a double importance. It may deprive the highest bona fide bidder of the goods and thereby cause a breach of a contract which he has made by being ...

Chapter XLV. Illegal Agreements - Wagers, Usury, Sunday Laws: One party only need incur risk in a gaming contract................... 1664a When an aleatory promise involves gambling.......................... 1665 A promised prise for competition by others ...

Sec. 1664a. One Party Only Need Incur Risk In A Gaming Contract: As will appear from the following sections, wagers and gaming contracts are generally illegal. The typical wager is familiar but the essential feature of a wager making it illegal must be understood i...

Sec. 1665. When An Aleatory Promise Involves Gambling: Every aleatory promise where the happening of the chance upon which performance of the promise depends involves no service by or disadvantage to the promisee, for which performance of the promise may ...

Sec. 1666. A Promised Prize For Competition By Others Does Not Involve Gambling: Where a prize is offered for competition, the acceptance of the offer by competitors does not constitute a wagering contract if the offeror of the prize does not take part in the competition.13 And th...

Sec. 1667. How Far Wagers Are Illegal At Common Law In England: The mere fact that an agreement was a wager did not make it unenforceable or opposed to public policy according to the English common law.17 Statutes, however, restricted various forms of betting, and...

Sec. 1668. Common Law Of The United States: In most of the United States there are doubtless statutes making wagers illegal, but irrespective of such statutes such agreements are generally held opposed to public policy.34 In with concern and al...

Sec. 1669. Speculative Contracts Of Purchase And Sale: Sales and contracts to sell are not in their nature wagers, but the machinery of stock exchanges and produce exchanges has been used for the purpose of speculation in making bargains which have been h...

Sec. 1670. Test Of Validity Is Intent To Make Actual Delivery: The test adopted in the absence of statute distinguishes between agreements to buy and sell in which an actual delivery of the property is contemplated, and similar agreements in which it is contempla...

Sec. 1671. Nature Of Transactions On Exchanges: There is no question anywhere that the dealings of a bucket shop, where market prices are used as a basis for the settlement of differences on so-called purchases and sales and where no delivery is ...

Sec. 1672. Whether Contract Between Broker And Customer May Be Invalid, Though That Made On The Exchange Is Valid: If a transaction is carried out on an Exchange as outlined in the preceding section, it seems difficult to see why an agreement between the broker and customer that the latter should only be required ...

Sec. 1673. Evidence Of Intention That There Shall Be No Actual Delivery: The language of the cases is nearly uniform that what is requisite in order to invalidate a contract which provides in terms for the purchase or sale of stock or produce is that the parties intend or ...

Sec. 1674. Subsequent Changes Of Intention: If an agreement is originally valid because the parties contemplated actual delivery, it is not invalidated by the discharge of the contract by a subsequent agreement to pay differences as they exist ...

Sec. 1675. Negotiable Instruments: If negotiable paper made by the loser is given to the winner in a gambling transaction, the latter can maintain no action upon it.47 An indorsee of an instrument who is not a holder in due course c...

Sec. 1676. Rights Of A Holder In Due Course: The only conflict concerning the enforceability of a negotiable instrument,given for a gambling debt arises when it has come into the hands of a holder in due course. In regard to illegality generally...

Sec. 1677. Indorsement Of Negotiable Instrument For Gambling Consideration: If a valid negotiable instrument made by a third person is indorsed by the owner in payment of a gambling debt, or for other illegal consideration the indorsee becomes the owner and can recover from t...

Sec. 1678. Mortgages And Pledges To Secure Illegal Debts: Where property is transferred not in satisfaction of the claim but by way of pledge or mortgage for the winnings in a gambling transaction, or for other illegal consideration, it seems clear that the ...

Sec. 1679. Recovery Of Money Staked: If the loser in a wagering contract pays the winner, he is debarred at common law from recovering the payment because he is in pari delicto.70 But, as has been said, in many states stat- 65 Benicia...

Sec. 1680. Prerequisites For Charging The Stakeholder: In a few States demand must be made upon the stakeholder before the wager has been decided.75 If a stakeholder pays the winner, before receiving notice of repudiation of the wager, he is not liable,76...

Sec. 1681. Collateral Effects Of Gambling Contracts: Since aiding an unlawful purpose is itself unlawful,84 if money is lent for the purpose of being used in gambling it cannot be recovered.85 While (since mere knowledge that illegal use is to be made o...

Sec. 1682. Usury: Usury, which originally meant simply interest for the use of money, but which now has come to mean excessive interest, is forbidden by law in many jurisdictions. All interest was deemed contrary to th...

Sec. 1683. Statutes In The United States: In many of the United States statutes against usury still exist, the particular provisions of which must be sought in local enactments. It may be said of these statutes as a whole, however, that they ...

Sec. 1684. Essential Elements Of Usury: The elements which must concur in order to constitute usury have been thus stated: To constitute usury, in contemplation of law, the following essential elements must be present: (1) There must be...

Sec. 1685. Loan Or Forbearance Of Money: The statute of Anne8 applied only to a loan or forbearance of money, and in the construction of this statute it was held that where property was sold, even though the contract provided in terms for th...

Sec. 1686. Forbearance: Forbearance of an existing debt may be as obnoxious to usury statutes as an original loan if a charge greater than legal interest is made for the forbearance.14 Nor is the transaction saved from illeg...

Sec. 1687. Loans In Substance Though Not In Form: The form of a sale or exchange of property may be used as a colorable method of making a usurious loan in several ways. (1) The lender may require the borrower to purchase property of him at an exc...

Sec. 1688. Renewal Obligations: Where an obligation originally given for a loan is tainted with usury subsequent renewals thereof will be open to the same defence; 24 and it is immaterial that the renewal obligation is made by a new...

Sec. 1689. Sale Of The Obligation Of A Third Person Cannot Be Usurious: The obligation of a third person, as his bill or note, like any other property, may in good faith be sold by the owner for any price he can get.33 This principle is undisputed if the seller does not i...

Sec. 1690. Discount Of Negotiable Paper Which Is Subject To A Defence: The fact that the maker of a negotiable instrument had a personal defence against the indorser or a prior party will not render usurious a sale of the instrument for a low price to a holder in due cou...

Sec. 1691. The Loan Must Be Of Money: As usury by its definition requires the loan or forbearance of money, the loan of chattels for a compensation measured in chattels of a similar kind is not usurious though the percentage of compensati...

Sec. 1692. The Loan Must Be Absolutely Payable: It is not usury to advance money which is to be repayable only on a contingency, even though the sum that will be repaid if the contingency happens exceeds the amount loaned with legal interest,54 if ...

Sec. 1693. Excessive Charges: Any payment to the lender in addition to legal interest whether called by the name of bonus or commission, or by any other name is usurious,62 And even if anything contracted for in excess of legal in...

Sec. 1694. Expenses Of Securing Or Collecting A Loan: Unless his action is colorable and a device to avoid the law, a lender may contract for payment, for his trouble, time and expense in collecting the money for the loan; 67 or for the expense of pr...

Sec. 1695. Certain Slight Excessive Charges Allowable By Custom: Though logically it is usurious to deduct in advance the highest legal rate of interest as a discount from the nominal amount lent,74 since the actual sum lent is less than the face of the obligation,...

Sec. 1696. Damages For Default May Be Greater Than Legal Interest: The provision in a pecuniary obligation that on default of the debtor in payment of either principal or interest the entire indebtedness including interest for the full term, or a greater sum than leg...

Sec. 1697. Effect Of Exactions By Lender's Agent: Even though an agent is acting for the lender, the latter is not affected by usury, taken or contracted for without his knowledge or authority, by the agent.90 On the other hand, where the principal a...

Sec. 1698. How Far Intent Is Essential: Ignorance of the law is generally no excuse, and where a transaction unmistakably a loan is made for a rate of interest exceeding that permitted by the law, the transaction is necessarily usurious.98 ...

Sec. 1699. Parol Evidence Of Usury: Where an agreement in writing purporting to contain the whole contract of the parties is unobjectionable, it has been urged that a collateral oral agreement for usury cannot render the written contrac...

Sec. 1700. Contracts Made Or To Be Performed On Sunday: The prohibition of certain employments or undertakings on Sunday is purely statutory. Aside from such statutes, all contracts legal in themselves, are valid, though made on that day. 3 Statutes have, ...

Sec. 1701. Preliminary Negotiations On Sunday Do Not Invalidate A Contract: The fact that the parties discussed on Sunday the terms of a proposed bargain will not invalidate it if afterwards entered into on a secular day, and what took place on Sunday may be upon the agent. K...

Sec. 1703. Effect Of Transfer Of Ownership: A sale of chattels on Sunday is followed by the same consequences as if entered into upon a secular day except that all remedy is denied to either of the wrongdoers.18 Accordingly 14 Dodson v. Harr...

Sec. 1704. Importance Of Delivery: If the property in the goods has passed but possession has not been delivered, it seems that the buyer would be unable to enforce any right to the property, for in order to show the seller's obligatio...

Sec. 1705. Sales Of Land And Choses In Action: It seems that a deed of conveyance made on Sunday transfers title, but if possession has not been delivered to the grantee, he cannot have the aid of the court and his theoretical title is worthless; ...

Sec. 1706. Persons Ignorant Of Fact That Contract Was Made On Sunday Are Not Affected By Illegality: An action may be maintained on a negotiable note made on Sunday, but dated on a secular day by one who purchased it in good faith.33 And though one who took the instrument with knowledge of the illega...

Sec. 1707. Ratification And Adoption Of Contracts Made On Sunday: Frequently an agreement made on Sunday is subsequently recognized, adopted, or ratified by the parties either expressly or by necessary implication, as for instance by carrying out on a secular day so...

Sec. 1708. Application Of The Principles Of Adoption: If goods have been sold and delivered on Sunday in a jurisdiction which holds that the property thereby passes to the buyer and that his obligation to pay the price cannot be enforced, there seems no ...

Sec. 1709. Works Of Necessity Or Charity: The English statute excepted from its operation works of necessity and charity;49 and in the United States similar exceptions are ordinarily made. What cases come within the exception cannot be marked...

Sec. 1710. Collateral Effects Of Illegal Sunday Agreements: Not only when the whole performance of a contractor's promise is in violation of a Sunday law, but where any material portion of it is, there can be no recovery upon the contract for any portion of th...

Chapter XLVI. Illegal Agreements: Contracts Obstructing The Administration Of Justice: Maintenance and champerty......................................... 1711 What are invalid champertous agreements............................. 1712 Collateral effects of champertous contracts........

Sec. 1711. Maintenance And Champerty: Maintenance means maintaining or supporting the litigation of another.1 Champerty is a bargain to divide the proceeds of a litigation between the plaintiff and the party supporting the litigation. Cha...

Sec. 1712. What Are Invalid Champertous Agreements: Blackstone Bays that a man may maintain the suit of his near kinsman, servant, or poor neighbor, out of charity and compassion, with impunity. 4 And there seems no doubt that not only the actual pay...

Sec. 1713. Collateral Effects Of Champertous Contracts: That champerty is no longer deemed so serious in effect as formerly, and probably also that the owner of the right of action is not regarded as in pari delicto with the attorney with whom he contracts...

Sec. 1714. Agreement To Encourage Litigation: Although maintenance in its simple form and even champerty is looked upon by the courts with less disfavor than formerly, schemes to promote litigation for the benefit of the promoter rather than for ...

Sec. 1715. Champertous Assignments: The early common law was very reluctant to permit the assignment of rights of action. Objection was indeed raised on the ground of maintenance to the assignment of any choses in action,20 and for the ...

Sec. 1716. Extra Compensation For Witnesses: As it is the duty of a citizen, when required to do so, to testify in court concerning facts within his knowledge for the compensation allowed him by law, a contract to pay one who is amenable to proc...

Sec. 1717. Contracts To Indemnify Sureties On Bail Bonds: It is held in England that a contract by the principal of a bail bond to indemnify sureties against liability for the principal's default is invalid.33 The reason for such decisions is that the object...

Sec. 1718. Agreements To Compound Crime: Any agreement having for its purpose or consideration the concealment or compounding of a crime is unlawful.39 This is settlement of the civil obligation,42 even though prosecution has already been be...

Sec. 1719. Agreements To Arbitrate: An agreement to arbitrate, whether constituting the whole contract between the parties or merely forming part of a larger contract, met with some jealousy on the part of the courts as tending to oust ...

Sec. 1720. Arbitration May Be Made A Condition Precedent In England: In England the parties apparently may make all rights under a contract conditional on arbitration, by using language appropriate for the purpose.56 The principle has thus been stated: If there is a c...

Sec. 1721. Decisions In The United States: In many of the United States a doctrine similar to that adopted by the English courts seems to prevail,60 and in this 60 Cf. Woodall v. Pearl Assurance Co., [1919] 1 K. B. 693. 61 Hamilton v. Ho...

Sec. 1722. Technical Character Of Distinctions: The lines of distinction drawn by the decisions are not very-clear and turn often upon matters of form rather than of substance, which is objectionable where the question is one of policy. In New York...

Sec. 1728. Illustration Of Difficulty In Applying Distinctions: These cases may be put as illustrations of the practical difficulty of applying such a test and as indicating that the test is little more than a matter of pure form: 1. In return for a promise of ...

Sec. 1784. Agreements To Arbitrate Should Be Enforced: One who examines the cases will probably reach the conclusion that the criticism of the law concerning agreements to arbitrate made by Judge Hough,66 is well founded except where the agreement is oppr...

Sec. 1725. Limiting Parties To Particular Courts Or Procedure: The right of a party to legal redress if he is injured is jealously guarded by the courts, and generally no agreement purporting to deprive a party of the right to sue in a Federal court,71 or in- ...

Chapter XLVII. Illegal Agreements: Agreements Tending To Corruption Or Immorality: Agreements tending to official or personal corruption.................... 1726 Lobbying contracts................................................. 1727 Application of principle.....................

Sec. 1727. Lobbying Contracts: An agreement by a legislator to exercise his judgment in a particular way is not binding at law. His promise, if without consideration, is not binding for that reason, and if he bargains for considera...

Sec. 1728. Application Of Principle: The general principle is clearer than the application of it in some instances. Some method of promoting in a lawful way desired legislation must be permissible; and an unskilled person must have the r...

Sec. 1729a. Contracts To Pay For Procuring Public Contracts: Closely analogous to lobbying contracts are bargains which have for their object obtaining a contract with the National Government or with a State or municipality, where no legislation is required. Th...

Sec. 1730. Agreements For Appointment And Compensation Of Officials: As it is the duty of a public official charged with making ap-pointments to make the best appointments possible without reference to private interests, and as it is expedient that those occupying publ...

Sec. 1731. Obtaining A Pardon: A promise in consideration of efforts by personal solicitation to procure a pardon, or in consideration of the assent or withdrawal of opposition to the granting of a pardon is generally held invalid ...

Sec. 1732. Elections: The purity of elections is of vital importance, and any agreement with voters tending to influence them by improper means, and any agreement with third persons to influence voters by indirect means, a...

Sec. 1734. Contracts For Location Of Public Buildings And Improvements: It is the duty of a municipality to erect its public buildings where they will best serve public convenience. As any inducement of a private nature to place or maintain such a building in a particular...

Sec. 1735. Contracts With An Interested Official: It has previously been seen 35 that the directors of a private corporation may, if there is no fraud in fact or unfairness in the transaction, contract on behalf of the corporation with one of their n...

Sec. 1736. Bargains For Offices Or Advantages In Private Corporations: The officers and even the stockholders of a private corporation are under certain duties to it and often to the public, which must not be made the subject of bargain. An agreement by a large stockhold...

Sec. 1737. Contracts Of Fiduciaries Tending To Impair Fidelity: A bargain by officers of a corporation for personal advantage in return for entering into an agreement on behalf of the corporation with a third person is invalid.42 A trustee's violation of his dutie...

Sec. 1738. Agreements, The Performance Of Which Involves A Wrong To A Third Person: An agreement which contemplates a wrong to a third person, or to undefined members of the public, whether trespass, breach of trust, or fraud, is illegal. Such is an agreement to print a book in viola...

Sec. 1739. Agreements In Fraud Of Creditors: A contract or transfer intended to defraud creditors can neither be rescinded nor enforced by legal proceedings on behalf of the fraudulent debtor.58 This is clear on principle at least where there is...

Sec. 1740. Quasi-Contractual Recovery: Where legislative services bargained for or performed are in part illegal, and in part legal, the rule generally applicable to partly illegal contracts prevails, and no recovery can be had for the leg...

Sec. 1741. Contracts In Regard To Marriage: As the sanctity of the marriage relation is at the foundation of the welfare of the State, the law has looked with jealous regard at contracts concerning that relation. A contract or a condition in re...

Sec. 1742. Separation Agreements: Contracts providing for or contemplating the future separation of husband and wife are opposed to public policy; but if a separation has already taken place, or is to take place contemporaneously with...

Sec. 1743. Agreements Facilitating Divorce: All contracts which have for their object or tendency the divorce of married persons are opposed to public policy. Agreements to bring suit for divorce or to make no defence to such a suit, or having ...

Sec. 1744. Agreements To Resume Marital Relations: There seems no reason why an agreement to resume marital relations where one of the parties has just cause for divorce should not be sustained, and it is generally held than an agreement in considerat...

Sec. 1745. Immoral Agreements: Future illicit cohabitation will not serve as consideration for a promise either of marriage,95 the support of a child,950 or of pecuniary advantage.96 The fact that past cohabi- 95 Hanks v. Naglee...

Sec. 1746. Contracts Inimical To Christianity. In The Early Common Law An Attack Upon Christianity, No: 1 W. Bl. 517; Smyth v. Griffin, 14 L. J. Ch. (N. S.) 28; Sismey v. Eley, 17 Sim. 1; Winebrinner v. Weiseger, 3 T. B. Mon. 32, 36. C/. Doty v. Doty's Guardian, 118 Ky. 204, 80 S. W. 803, 2 L. R. A. ...

Chapter XLVIII Miscellaneous Illegal Agreements: Contracts with alien enemies forbidden............................... 1747 Contracts with aliens suspended or avoided by declaration of war........ 1748 Agreements involving violation of foreign...

Sec. 1747. Contracts With Alien Enemies Forbidden: Trading with the enemy in time of war is illegal; since the object of war is as much to cripple the enemy's commerce as to capture his property. l Therefore, During a state of hostility the citizen...

Sec. 1748. Contracts With Aliens Suspended Or Avoided By Declaration Of War: Existing contracts between domestic citizens and enemy aliens, which were entered into before war broke out and which were valid at that time, are either suspended or terminated by a declaration of wa...

Sec. 1749. Agreements Involving Violation Of Foreign Laws: A contract which involves no moral turpitude, and the enforcement of which will violate no public policy of the State where action is brought, if valid where made will be enforced in the former jurisd...

Sec. 1750. Contracts Tending To Promote Illegal Acts: Even though a contract does not directly require any unlawful or improper act for its performance, if the tendency of the contract is to encourage or hold out a reward for a result that can be brought...

Sec. 1751. Contracts To Indemnify For An Illegal Act: Because of its tendency to promote illegal acts a contract to save the promisee harmless from the consequences of an act which is necessarily unlawful is itself invalid.17 Thus a contract to indemnify...

Sec. 1752. Contracts Collaterally Connected With Unlawful Intent Or Act: A contract though in itself neither unlawful in what it promises, nor in the consideration for the promise, may be obnoxious as part of a general scheme to bring about an unlawful result, or may be cl...

Sec. 1753. Test Of Whether Agreement Is Collateral. Parol Evidence: The test is often suggested, as determining whether the relation of an illegal transaction is sufficiently close to the plaintiff's alleged cause of action to preclude recovery, that if enforcement of...

Sec. 1754. Knowledge Of Another's Unlawful Purpose: Frequently a sale or contract to sell goods is not in itself unlawful, but the purpose of the buyer or seller is unlawful. It is held in England that mere knowedge of an illegal purpose of the other p...

Sec. 1755. Promotion Of Another's Unlawful Purpose: If a seller does anything beyond making the sale to aid the unlawful purpose of the purchaser, he cannot recover,44 A common application of these principles is in regard to leases mell v. Reed, 5 T. R...

Sec. 1756. The Distinction Often Difficult: It must be admitted that where a plaintiff has furnished the defendant with the necessary means to carry out an illegal purpose the distinction between the mere knowledge of and the promotion of that ...

Sec. 1757. Executory Promise To Furnish Goods Intended For Unlawful Purpose Imposes No Liability: Though a seller who knows the illegal purposes of a buyer of goods of a character not exclusively appropriate for such purposes, may not on that account be denied a right to recover the price of the g...

Sec. 1758. Effect Of Performance, Illegal When Contract Was Made, Becoming Legal: It may sometimes happen that a contract is illegal when it is made either because of the illegal purpose of the parties to the contract or for other reasons, and that when the contract is performed th...

Sec. 1769. Effect Of Performance, Legal When Contract Was Made, Becoming Illegal: In the converse case where the contract was originally legal, but because of a change in purpose of the parties, or a change in the law, performance of the acts contracted for on one side or the other...

Sec. 1760. Change Of Purpose Regarding Performance Not Unlawful In Itself: It has been laid down on high authority that When it is sought to avoid an agreement, not being in itself unlawful, on the ground of its being meant as part of an unlawful scheme, or to carry out an ...

Sec. 1761. Illegal Performance Of Legal Contract: It has been said that there is no policy of the law against the plaintiff's recovery unless his contract was illegal, and a contract is not necessarily illegal because it is carried out in an illegal...

Sec. 1762. Executory And Executed Illegal Contracts: The illegality of a contract or sale may result either from the illegality of the promise or from the illegality of the consideration given for the promise. A promise to do an illegal thing for a lega...

Sec. 1763. Contracts And Sales Prohibited By Statute: For the protection of the public or for purposes of taxation, or for both reasons, many statutes are enacted forbidding certain contracts and sales either altogether or unless certain statutory regula...

Sec. 1764. Mala Prohibita And Mala In Se: No distinction is now made between things which are merely mala prohibita and things which are mala in 9e. Courts cannot go behind the legislative prohibition when the prohibition itself is clear.71 B...

Sec. 1766. Illustrations Of Prohibitory Statutes: Where a statute prohibits altogether the sale of certain goods, not only an agreement for such a sale is invalid, but if a sale is made in violation of law the agreed price cannot be recovered.73 Wher...

Sec. 1766. Further Illustrations Of Prohibitory Statutes: The price of liquor sold in violation of a liquor license law, cannot be recovered,77 nor the price of goods sold in violation 74 Cope v. Rowlands, 2 M. & W. 149; Hustis v. Picklands, 27 111. App. ...

Sec. 1767. Slight Violations Of Statutory Prohibitions: Where the illegality of work done or of materials furnished under a contract is slight, or where judgment for the defendant will impose a severe forfeiture upon the plaintiff, courts are astute to dis...

Sec. 1768. Statutes Purely For Revenue: Statutes sometimes impose a tax upon the transaction of certain business merely for the purpose of revenue, and not with any view of limiting or regulating the trade itself. If such statutes merely im...

Sec. 1769. Revenue Statutes May Invalidate Contracts: On a true construction generally even a revenue statute will be found to prohibit contracts made without satisfying the requirements of the law. There can certainly be no doubt that a contract or sale...

Sec. 1770. Statutes For The Protection Of The Parties: Besides contracts in violation of a statute purely for revenue, there are other statutes which, though they make transactions in violation of them unenforceable, do not make them illegal, It is settl...

Sec. 1771. Contracts Of Corporations Doing Business Illegally: The laws of the several States almost invariably prescribe certain conditions which must be satisfied before foreign corporations are authorized to do business within the State. Some of these statutes...

Sec. 1772. Statutes Expressly Prohibiting Recovery: Modern statutes in regard to foreign corporations frequently expressly provide, in effect, that no action shall be maintainable on the contracts of the corporation if it has not satisfied the requirem...

Sec. 1773. Corporation Illegally Doing Business Is Liable On Its Contracts, And May Set Them Up In Defence: It should be added that even though a corporation does business in violation of a statute, and in consequence thereof becomes unable to enforce the obligation of the other party under a contract, it i...

Sec. 1774. Wrongful Addition Of " & Company " To Name: A related question arises under a New York statute which makes it a penal offence for one doing business to add the words & Company to his name as a business designation unless those words represent...

Sec. 1775. State Power To Control Interstate Commerce Is Limited: It is a difficult question which cannot be fully considered here to determine what constitutes doing business within a State by a foreign corporation and the difficulty is increased especially in rega...

Sec. 1777. Police Power Of The States: The only qualification of the exclusive power of Congress in dealing with interstate commerce is imposed by the police power of the several States. By virtue of this power deceptive or dangerous and u...

Sec. 1778? Illustrations Of Protected Interstate Commerce: Subject to the slight qualification thus imposed by the police power, a corporation in one State may not only sell its goods for delivery in another State but collect the price in the latter State.21 ...

Sec. 1779. Where Some Things Promised Are Illegal, And Some Legal | The Latter May Be Enforced If Consideration Is Legal: It was early decided,35 that where some covenants of an indenture are legal and others illegal the legal covenants may be enforced. This is the simplest form of the problem of partly illegal contracts...

Sec. 1780. Illegal Consideration: The problem of partly illegal contracts quite commonly arises where it is not a promise which is illegal but part of the consideration. Where there is a single consideration for one or more promises a...

Sec. 1781. Sale Of Several Things At Separate Prices: This doctrine has been especially applied in the law of sales to cases where several lots of goods have been sold and separate prices affixed to each lot, and as to some of the goods sold, the transac...

Sec. 1782. Partly Illegal Bilateral Contracts: In the preceding sections reference has been made to unilateral contracts exclusively. In bilateral contracts a further element complicates the problem. In such contracts the consideration must be goo...

Sec. 1783. Illegal And Insufficient Consideration Distinguished: Care must be taken to distinguish illegal consideration from consideration which is merely bad for insufficiency. Consideration of the latter sort will not invalidate a contract, though not of itself ...

Sec. 1784. Notes And Accounts Stated: If a note is given in settlement of an account, some items of which are legal and some illegal, though the creditor may disregard the note, if dishonored by the maker, and sue upon the legal items of ...

Sec. 1786. Recovery Of Profits Of An Illegal Transaction From A Partner Or Agent: As a general principle it is certainly true that no accounting or recovery of profits can be had by one party to an illegal transaction against another. The classical case is that of a bill brought by...

Sec. 1786. Criticism Of Suggested Distinctions Between Partner And Agent: But in the case of a contract objectionable because of illegality the general principle is that one may make use of the defence in order to rob an associate,59 and it is difficult to draw a distinctio...

Sec. 1787. Rescission Of Executed Illegal Contracts: It is doubtless possible for the law to make even an attempted executed sale with transfer of possession so absolutely void that no title passes to the buyer; but the mere fact that a sale is against ...

Sec. 1788. Rescission Allowed When Illegal Agreement Unex Cuted: Where money has been paid or goods have been delivered in part performance of an illegal agreement, the money or pay ment for the goods may be recovered so long as the illegal part of the agreement is...

Sec. 1789. Parties Not In Pari Delicto: In some cases rescission of an illegal transaction and recovery of consideration is allowed beyond the limits stated in the preceding section. This is true where the parties are said not to be in pari...

Sec. 1790. Where One Party Is A Fiduciary: If the illegal transaction was entered into by a trustee or guardian so that any penal consequences visited upon the transaction will fall, not upon the guilty fiduciary, but upon his beneficiary, rel...

Sec. 1791. Where One Party Was Induced By Fraud To Enter Into The Illegal Contract: Where one party to a bargain has been fraudulently induced to enter into the transaction, it is frequently said he is not in pari delicto, and the case has sometimes been classed with duress or coerci...

Sec. 1792. Conflict Of Laws: The legality of a contract depends upon the law of the place where it is made.84 If the contract was illegal (as distinguished from merely unenforceable) where made it is invalid everywhere 85 and if ...

Book VIII Discharge Of Contracts. Chapter XLIX. Methods Of Discharge - Application Of Payments; Tender: Methods of discharge............................................... 17 Treatment of these methods......................................... 17 Application of payments: debtor has primary right......

Sec. 1793. Methods Of Discharge: A contract may be discharged in the following ways: 1. Performance according to its terms. 2. A breach of such a nature as to justify the innocent party in treating the contract as rescinded or ...

Sec. 1794. Treatment Of These Methods: The first three methods here specified have been treated with more or less fulness in earlier parts of this work, but something may here be added regarding a division of the first method - payment - s...

Sec. 1795. Application Of Payments; Debtor Has Primary Right: When a debtor owes money on several accounts and makes a payment of less than the total amount due from him, it becomes important to determine to which debt or to which item the payment is to be credi...

Sec. 1796. The Creditor May Direct The Application If The Debtor Does Not: The right of the debtor to direct the application ceases as soon as the payment is made,7 because having once made payment unconditionally he cannot thereafter revoke his act and v. Hodgson, 6D.M.&G. ...

Sec. 1797. Limitations Of The Creditor's Right: Where one debt is due to the creditor in his own right and another to him as trustee or agent for another, and neither is secured, the creditor cannot apply the whole of a general payment to his own ...

Sec. 1798. Time Allowed The Creditor To Make Application: Unlike the debtor, the creditor is not confined to the tin when the payment is made for his appropriation. It is with settled that he is not required to make his choice immediate except in a few juris...

Sec. 1799. What Amounts To An Appropriation By The Creditor: What constitutes a final appropriation by the creditor is not wholly clear. There is no doubt that if the creditor communicates to the debtor in any way a decision to make a particular appropriation, ...

Sec. 1800. Where Neither Debtor Nor Creditor Directs Application: If neither party has manifested an intention concerning the application of a payment, the court is compelled to make the application itself. In doing this the court endeavors to reach an equitable res...

Sec. 1801. Illustrations Of Application By The Law: In accordance with the principle just stated, payments will be applied by the court to an unsecured or precarious debt, rather than to a secured one.37 It is also held, certainly if all payment will b...

Sec. 1802. Effect Of Allowing Creditor Indefinite Time To Make Application: It is obvious that under the English rule allowing the creditor a right to direct the application of a payment even after litigation has begun, there is small place for the rule that in the absence of...

Sec. 1803. The Rule Of The CIVIL Law: The Civil law differs from the common law in its rules concerning the application or imputation of payments, especially 44 In Cory Bros. & Co. v. The Mecca, [1897] A. C. 286, there were two debts i...

Sec. 1804. Interests Of Third Persons: The debtor and creditor have ordinarily the exclusive power to determine the application of a payment and in exercising this power are not obliged to consider the interests of third persons such as su...

Sec. 1806. Payment Of Trust Money: Where the money paid is trust money the general principles of trusts must be applied. The original beneficiary may insist on the trust against any one but a purchaser for value without notice; and the...

Sec. 1806. Payment With Money Derived From A Particular Source, But Not Held In Trust: It seems impossible to deny that the usual rules governing the application of payments should control the application of any payment, if the debtor who makes the payment did not hold it subject to a t...

Sec. 1807. Application Of Collateral: The creditor's right to apply the proceeds of collateral held for several debts is not limited by the fact that for one of the debts a surety also is bound. The collateral is a trust fund which canno...

Sec. 1808. Definition Of Tender: Tender is an offer to perform a condition or obligation coupled with the present ability of immediate performance, so that were it not for the refusal of cooperation by the party to whom tender is mad...

Sec. 1809. Importance Of Tender: Tender may be important in various aspects: 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...

Sec. 1810. Essential Characteristics Of Tender: As tender would amount to complete performance, if the offer were carried out, the requisites of a valid tender are indicated by the requisites of valid performance. There must be an un-conditional of...

Sec. 1811. By Whom And To Whom Tender Must Be Made: Tender must be made by the debtor or by his agent.74 Whatever may be the effect of payment by a stranger when accepted by the creditor,75 it is clear that the creditor is under no obligation to accept...

Sec. 1812. Place Of Tender. Tender Must Also Be At The Place Provided In The Contract: for performance, or if no provisions is made, then at the place determined by law. There are special rules in regard to negotiable paper,78 in regard to the transfer of chattel property,79 and in rega...

Sec. 1813. What Money Is Legal Tender: Legal tender for the payment of pecuniary debts in the United States is by statute established as follows: Gold coins for any amount; silver dollars for any amount; subsidiary silver coins for sums no...

Sec. 1814. Tender Must Be Unconditional: A tender made as a basis for acquiring a concurrent right to an exchange due from the party to whom tender is made may be made conditional on the performance by the latter of his obligation;89 but a t...

Sec. 1816. Conditional Tender Of Secured Debt: So strict is the rule that a tender must be absolute that it has been said that a tender accompanied with a demand for collateral securities pledged for the debt is insufficient;95 and that a tender b...

Sec. 1816. Tender Must Be Kept Good: Where a tender does not discharge the debtor's obligation he must keep the tender good in order that it shall be effectual to bar damages for delayed performance, that is, he must continue ready and w...

Sec. 1817. Effect Of Tender In Discharging Obligations: The effect of a tender in giving rise to a right under a bilateral contract has been elsewhere considered,8 and here there is only in question the effect of a tender upon an absolute obligation.9 Such...

Sec. 1818. Tender Of Chattel Property: The effect of a tender of specific articles logically should depend on the ability of the debtor to transfer title to the creditor by tendering the goods to which the creditor is entitled and storing ...

Sec. 1810, Ad Fin: 15 Supra, Sec.Sec. 1365 et seq. 16 Garrard v. Zachariah, 1 Stew. (Ala.) 272; Smith v. Loomis, 7 Conn. 110; Saunders v. Denison, 20 Conn. 521, 525; Fannin v. Thomason, 50 Ga. 614, 616; Games v. Mann...

Sec. 1819. Waiver Of Objection To Tender: Under general principles, previously discussed,19 tender is excused by obstruction or prevention or imposition of unwarranted conditions by the person to whom it was to be made.20 It is also generally...

Chapter L. Release, Rescission, Accord, Accounts Stated, Novation: Nature and effect of release......................................... 1820 Early law......................................................... 1821 Effect of statutes in regard to seals.............

Sec. 1820. Nature And Effect Of Release: A release, as the word is used technically in speaking of executory contracts, is a discharge under seal of an existing obligation or right of action. In the law of conveyancing, however, a release op...

Sec. 1821. Early Law: In very early times it may be that a release did not operate as a legal discharge of a specialty,5 since payment6 or judgment 7 did not. Even at the present day a negotiable instrument before maturity...

Sec. 1822. Effect Of Statutes In Regard To Seals: The legislation in many of the United States,9 depriving a seal of the efficacy which it had at common law, has been unfortunate in depriving the law of a simple and easy means for the voluntary disch...

Sec. 1823. Covenant To Forbear: A release properly is a present discharge; and a release of a right to be acquired in the future is, therefore, anomalous, and, in the view of early lawyers, an impossibility;14 but a covenant of perp...

Sec. 1824. Conditional Releases: A release may be subject to the happening of a condition precedent,18 and it has been held that it may also be subject to a condition subsequent.19 There seems difficulty in this result, however. It w...

Sec. 1826. Construction: Most of the cases on releases involve questions of construction only, and some technical rules of construction have been established; but these, like most rules of construction,, would be held subordi...

Sec. 1826. Elements Of Rescission By Parol Agreement: The discharge of a contract by the parol agreement of the parties would seem on principle to require the same elements of mutual consent and consideration that are necessary for the formation of simpl...

Sec. 1827. Restoration Of The Status Quo: Where at the time of rescission of a bilateral contract it has been partly performed on one or both sides, the parties may agree simply to forego further performance and let past matters stand where t...

Introduction Vol5: It was early recognized in planning for the Treatise on the Law of Contracts which I have written, that it was desirable, if not essential, that a book of forms should form a part of the undertaking. ...

Preface Vol5: In response to a demand for a book of forms for use in connection with Professor Williston's great treatise on the Law of Contracts, his publishers deemed it advisable to have such a book prepared. As...

The Law Of Contracts Arbitration: Form of Arbitration Clause l Recommended by Chamber of Commerce of the State of New York Williston - Sections 227, 677, 767, 798, 1421, 1719 to 1723, 1925 to 1930. Laws of New York, Chap. 275...

Chapter VI "Arbitration: Article XXX. If the Commission or the Lessee shall desire to submit to arbitration any matter of difference arising under any provision of this contract in respect of which it is therein provided an ...

Building Contracts: Williston - Sections 63, 130, 372, 418, 422 n., 433, 493, 615, 642, 680, 688, 689, 699, 704, 724, 741, 786, 789, 794, 797, 798, 805, 811, 842, 848, 849, 875, 893, 1240-1243, 1341, 1347, 1363, 1423,146...

Notes On The Standard Documents 1 The Construction Of The Documents: An Agreement, Drawings find Specifications are the necessary parts of a building contract. Many conditions of a general character may be placed at will in the Agreement or in the Specifications. It is...

The General Conditions Of The Contract. Standard Form Of The American Institute Of Architects: The Standard Documents have received the approval of the National Association of Builders' Exchanges, the National Association of Master Plumbers, the National Association of Sheet Metal Contractors o...

The General Conditions Of The Contract. Part 2: Art. 6. Drawings And Specifications On The Work The Contractor shall keep one copy of all drawings and specifications on the work, in good order, available to the Architect and to his representativ...

The General Conditions Of The Contract. Part 3: Art. 15. Deductions For Uncorrected Work If the Architect and Owner deem it inexpedient to correct work injured or done not in accordance with the Contract, the difference in value together with a ...

The General Conditions Of The Contract. Part 4: Except as provided in Articles 3, 9 and 18, no change shall be made unless in pursuance of a written order from the Owner signed or countersigned by the Architect, or a written order from the Architec...

The General Conditions Of The Contract. Part 5: Art 31. Royalties And Patents The Contractor shall pay all royalties and license fees. He shall defend all suits or claims for infringement of any patent rights and shall save the Owner harmless fr...

The General Conditions Of The Contract. Part 6: Art. 39. Damages If either party to this contract should suffer damage in any manner because of any wrongful act or neglect of the other party or of any one employed by him, then he shall be reimbu...

Art. 44. Relations Of Contractor And Subcontractor: The Contractor agrees to bind every subcontractor and every subcontractor agrees to be bound, by the terms of the General Conditions, Drawings and Specifications, as far as applicable to his work, inc...

Art. 45. Arbitration: Subject to the provisions of Article 10, all questions in dispute under this contract shall be submitted to arbitration at the choice of either party to the dispute. The Contractor agrees to push the ...

The Standard Form Of Bond: FOB USE IN CONNECTION WITH THE THIRD EDITION OF THE STANDARD FORM OF AGREEMENT AND GENERAL CONDITIONS OF THE CONTRACT This form has been approved by the National Association of Builders1 Exchanges,...

The Standard Form Of Agreement Between Contractor And Subcontractor: For Use In Connection With The Third Edition Of The Standard Form Of Agreement And General Conditions Of The Contract This form has been approved by the National Association of Builders' Exchanges,...

Standard Form Of Acceptance Of Subcontractor's Proposal: FOR USE IN CONNECTION WITH THE THIRD EDITION OF THE STANDARD FORM OF AGREEMENT AND GENERAL CONDITIONS OF THE CONTRACT This form has been approved by the National Association of Builders' Exchanges,...

A Form Of Agreement Between Contractor And Owner: ISSUED BY THE AMERICAN INSTITUTE OF ARCHITECTS FOR USE WHEN THE COST OF THE WORK PLUS A FEE FORMS THE BASIS OF PAYMENT FIRST EDITION - COPYRIGHT 1920 BY THE AMERICAN INSTITUTE OF ARCHITECTS, WAS...

A Form Of Agreement Between Contractor And Owner. Continued: (h) Cost of hand tools, not owned by the workmen, canvas and tarpaulins, consumed in the prosecution of the work, and depreciation on such tools, canvas and tarpaulins used but not consumed and which ...

The Standard Form Of Agreement Between Owner And Architect: ISSUED BY THE AMERICAN INSTITUTE OF ARCHITECTS FOR USE WHEN A PERCENTAGE OF THE COST OF THE WORK FORMS THE BASIS OF PAYMENT SECOND EDITION - COPYRIGHT 1917 BY THE AMERICAN INSTITUTE OF ARCHITECTS, ...

Conditions Of Agreement Between Owner And Architect. Continued: Article 1. The Architect's Services The Architect's professional services consist of the necessary conferences, the preparation of preliminary studies, working drawings, specifications, large scale...

A Form Of Agreement Between Owner And Architect On The Fee Plus Cost System: COPYRIGHT 1917 BY THE AMERICAN INSTITUTE OF ARCHITECTS, THE OCTAGON, WASHINGTON, D. C. This Agreement made the............................... day of............in the year Nineteen Hundred an...

Conditions Of Agreement Between Owner And Architect: Article 1. The Architect's Services The Architect's professional services consist of the necessary conferences, the preparation of preliminary studies, working drawings, specifications, large-scale...

The Standard Form Of Agreement Between Contractor And Owner: ISSUED BY THE AMERICAN INSTITUTE OF ARCHITECTS FOR USE WHEN A STIPULATED SUM FORMS THE BASIS OF PAYMENT The Standard Documents have received the approval of the National Association of Builders' Ex...

The Standard Form Of Agreement Between Contractor And Owner. Part 2: Notes on the General Conditions or the Contract In some cases the Articles as printed do not include all necessary General Conditions of the Contract. The Architect will then add such others as he ...

The Standard Form Of Agreement Between Contractor And Owner. Part 3: ($..........). If he be notified of the acceptance of this proposal within ............days of the time set for the opening of bids he agrees to execute a contract for the above work, for the above...

The Standard Form Of Agreement Between Contractor And Owner. Part 4: It is agreed that in the aforesaid net cost there shall not be included any interest on moneys, rent of the general office of the Contractor, the services of any walking or visiting superintendent, or...

The Standard Form Of Agreement Between Contractor And Owner. Part 5: certifying that the Contractor has performed such labor and cartage, and furnished such materials and manufactured such materials, under and in accordance with the provisions of this agreement, as to ...

The Standard Form Of Agreement Between Contractor And Owner. Part 6: 11. The Contractor shall guard, cover, protect, and exercise due diligence to secure, and will secure said premises and building thereon, also the adjoining and contiguous premises with wall or walls,...

Building Contract - Cost Plus Basis - Another Form: Agreement, made.................... between........ ............hereinafter referred to as Contractor and..... ..............hereinafter referred to as Owner. In consideration of the mutual p...

Building Contract - Cost Plus Basis - Another Form. Part 2: 7. Should the Owner desire, at any time during the progress of said work, to make any alterations or deviations from, or additions to, the plans or specifications, or from the require-ments under this...

Building Contract - Cost Plus Basis - Another Form. Part 3: (d) The cost of value (at the option of the Contractor) of all plant, horses, lumber, timbers, tools, machinery and implements used in connection with said works. II. On completion of the works on ...

Building Contract - Cost Plus Basis - Another Form. Part 4: 12. The Contractor shall keep full, accurate and careful account of all supplies and materials acquired by it for use under this contract, and shall also keep in separate accounts a full, accurate and...

Building Contract - Cost Plus Basis - Another Form. Part 5: (e) In the event that the Owner shall elect to rebuild the building, or to repair such partial but substantial destruction, then and in that event the cost of such repair or rebuilding (as the case ma...

Building Contract - Cost Plus Basis - Another Form. Part 6: Article II. Cost of the Work The Contractor shall be reimbursed in the manner hereinafter described for such of its actual net expenditures in the performance of said work as may be approved or rat...

Building Contract - Cost Plus Basis - Another Form. Part 7: No salaries of the Contractor's executive officers, no part of the expense incurred in conducting the Contractor's main office, or regularly established branch office, and no overhead expenses of any ...

Building Contract - Cost Plus Basis - Another Form. Part 8: (b) Promptly pay for all labor, material, or other service rendered. (c) Procure and thereafter maintain such insurance in such forms and in such amounts and for such periods of time as the Contrac...

Building Contract - Cost Plus Basis - Another Form. Part 9: Article IX. Bond The Contractor shall, prior to commencing the said work, furnish a bond, with sureties satisfactory to the Contracting Officer, in the sum of..........dollars, conditioned upon ...

Contract between Contractor and Owner for Excavation: Agreement made............between.............hereinafter called the Contractor, and............hereinafter called the Owner, Witnesseth, as follows: 1. The Contractor agrees in consideration of th...

Building Contract Between General Contractors and Sub-Contractor: Agreement, made the................day of........ ........in the year........................by and between ......................................(acting as Agents of the Owner) hereinafter desi...

Building Contract Between General Contractors and Sub-Contractor. Part 2: 6. The Sub-Contractor shall and will proceed with the said work, and every part and detail thereof in a prompt and diligent manner, and shall and will do the several parts thereof at such times and in...

Building Contract Between General Contractors and Sub-Contractor. Part 3: 10. Should the proper, workmanlike and accurate performance of any work under this contract depend in any way upon the proper, workmanlike or accurate performance of any work by another contractor on ...

Commercial Contracts. Letters Of Credit: Letter of Advice (American Conference Form A) 1. Revocable and Unconfirmed Letter of Advice. No..... 3. Messrs............................................. 5. Dear Sirs: 6. We are infor...

Rules to Govern Transactions between Buyers and Sellers of Broad Silks in the United States of America, Except when Otherwise Specified: As Approved by the Silk Association of America, December 8, Rule 1. Selling Terms shall be six per cent. ten days, sixty days dating. This means that bills are due and payable at the office of the ...

Contract For Sale Of Goods On Consignment: Williston - Secs. 484,446 n., 655,720 n.; Ludvigh v. American Woolen Co., 231 U. S. 522; 34 Supreme Court Reporter 161. Collier on Bankruptcy; (12th Edition, pp. 1069 and 1149). Agreement mad...

Conditional Sale Agreement: Williston - Secs. 236, 607, 731, 734-738, 772, 773, 869, 961, 965,1137,1374,1773,1902. Agreement made............between............, hereinafter described as the Seller, and......hereinafter des...

Contract Between Manufacturer and Distributor for Sale of Product - Erection of Plant - Agreement to Supply Wants of Distributors - Forfeiture of Rights of Sale - Rights to Use Trade Name - Right to Assign to Corporation: Coca - Cola Bottling Co. v. Coca-Cola Co., 269 Fed. 796. Agreement made.......... between,.......... hereinafter described as the Distributor and.........., hereinafter described as the Manufact...

Agreement for Sale of Manufacturer's or Distributors Products in Department Store: Standard Fashion Co, v. Siegel-Cooper Co., 157 N. Y. 60, 43 L. R. A. 854, 51 N. Y. 408, Agreement made.. .......between...................., hereinafter referred to as the Principal, and..........h...

Contract Licensing Patented Amusement Game or Device - Exclusive Rights: Gonzales v. Kentucky Derby Co., 197 App. Div. 277, 189 N. Y. Supp. 783. Agreement made..........192 , between.............., a New York corporation, hereinafter called the Company, and................

Patents - License Agreement to Manufacture and Sell Commodity - General Form: Williston - Sees. 607n., 1446, 1642, 1649,1652, 1661, 1934n. Agreement made..........between................... hereinafter described as the Licensor, and................ hereinafter descri...

Patents - License Agreement to Manufacture and Sell Commodity-Another Form - Provisions for Arbitration, Rebates, Accounting - Special Provisions for Limited Territory: Agreement made....................between the..... .................., hereinafter described as the Licensor, and....................., hereinafter described as the Licensee, Whereas, the Licens...

License Agreement to Manufacture and Sell Commodity-Another Form - Provisions for Arbitration, Rebates, Accounting - Special Provisions for Limited Territory. Continued: 7. If in any year, beginning.........., the royalties from ...................., actually received by the Licensor from its several licensees referred to in...................., shall exceed the su...

Patent License to Manufacturer: Agreement made............between.................. hereinafter called Patentee, and................hereinafter called Manufacturer, Witnesseth: Whereas, the Patentee is the sole and exclusive o...

License to Use Patented Invention - Contract of Employment of Inventor - Royalties, Profits, Compensation - Limited Arbitration - Separate Accounting System: Agreement made this..........day of................, between................, hereinafter described as The Inventor, and............., hereinafter described as The Company Witnbsseth: Whe...

Contract of Employment of Inventor - Royalties, Profits, Compensation - Limited Arbitration - Separate Accounting System. Continued: 9. The Company agrees to produce and manufacture the said...............in such quantities as are consistent with the demand for the same and facilities for manufacture. 10. The Company agrees to a...

Contract of Exclusive Agency for Sale of Merchandise: Williston - Secs. 90, 279, 280, 653,1406,1446,1645,1700n. Agreement made..............., between............. hereinafter referred to as the Principal, and................ hereinafter referr...

Contract for Exploitation of Secret Process: Williston -1643 and 1646; Grant v. Pratt, 52 App. Div. 540, 65 N. Y. Supp. 486, 87 App. Div. 490, 86 N. Y. Supp. 983, 110 App. Div. 149, 97 N. Y. Supp. 38, 110 App. Div. 867, 97 N. Y. Supp. 29. Aff...

Contract for Exploitation of Secret Process. Continued: 6. The Manufacturer agrees immediately to enter upon and by all reasonable endeavors to push the manufacture and sale of all grades of said goods, and at all times to actively continue such manufactur...

Contract for Purchase of Secret Process: Williston - Sections 1643 and 1646 see. Grant v. Pratt, 52 App. Div. 640, 65 N. Y. Supp. 486, 87 App. Div. 490, 84 N. Y. Supp. 983,110 App. Div. 149, 97 N. Y. Supp. 38, 110 App. Div. 867, 97 N. Y. Sup...

Contract for Sale of Business Including Good Will with Covenant Not to Compete: Williston - Sections 141, 413, 495, 497, 752, 781, 787, 829n., 872,1022,1406,1442,1446,1636 to 1658; Diamond Match Co. v. Roeber, 106 N. Y. 473,13 N. E. 419. Agreement made............between......

Contract Appointing Exclusive Sales Agent: Williston - Sections 90, 279, 280, 663, 1406, 1446, 1645, 1700n.; Champion Spark Plug Co. v. Automobile Sundries Co., 273 Fed. 74. Agreement made between................, hereinafter designated ...

Fledge of Stock as Collateral Security: Williston - Secs. 173,978,1021,1042-1044,1064,1678,1817. Know all men by these presents, that the undersigned, in consideration of financial accommodations, given, or to be given, or continued to t...

Agreement Between News Syndicate and Artist or Writer for Work to be Sold to Newspapers: Wheeler Syndicate, Inc., v. The Star Company, 231 N. Y. 99, 132 N. E. 907. Certiorari denied 42 Supt. Ct. Rep. 94. Agreement made............between................of ................hereinafter...

Agreement Between Artist or Writer and News Syndicate for Work to be Sold to Newspapers. Continued: 8. It is further agreed that if the Artist shall during the term of this agreement desire to produce a page of..............., for publication in newspapers, or any.........for publication in newspape...

Agreement for Sale of Accounts by Merchant to Finance Company - Power of Attorney: Greey v. Dockendorff, 231 U. S. 513, 34 Sup. Ct. Rep. 166; Van Iderstine v. National Discount Co., 227 U. S. 575, 33 Sup. Ct. Rep. 343; Coder v. Arts, 213 U. S. 223, 29 Sup. Ct. Rep. 436. Agr...

Assignment (In Connection With The Foregoing): Know all men by these presents, That for value received, we have bargained, sold, transferred, assigned, and set over and by these presents do bargain, sell, transfer, assign and set over unto...........

Agreement for Sale of Accounts to Finance Company: Another Form Agreement, made this........day of........19.., between ........, a corporation organized under the State of New York (hereinafter designated as the Company) and ........(hereinafte...

Agreement between Banker and Merchant for Advances against Assigned Accounts - Assignment of Accounts: Agreement made...............between............... hereinafter called the Banker and..............thereinafter called the Assignor............................... The parties hereto mutually...

Factors' Agreements: Williston - Sections 484,446n., 655, 720d.; See also: New York Personal Property Law, Section 45. Ludvigh v. American Woolen Company, 231 U. S. 522, 34 Sup. Ct. Rep. 161; Collier on Bankruptcy, 12t...

Factors' Agreements. Part 2: 9. The Principal shall have no authority to make any purchase, order or contract for the purchase of any goods or merchandise on behalf of the Factor, or to pledge the credit of the Factor for any pur...

Factors' Agreements. Part 3: in the first sentence of this paragraph, and that portion of this paragraph commencing with the words the Factor shall also receive as additional compensation and ending with the words on account o...

Factors' Agreements. Part 4: 17. The premises occupied by the Principal for the conduct of their business shall have a sign thereon in accordance with [Section 45 of the Personal Property Law of the State of New York,] bearing th...

Factor's Agreement - Another Form: Agreement made the........day of........, between .........and........., hereinafter called the Factors, and......., hereinafter called the Customer, Witnesseth: Whereas, the Customer is eng...

Factor's Agreement - Another Form. Part 2: Customer, but all at the cost and expense of the Customer. All merchandise returned by the purchasers thereof shall in any event immediately be redelivered to the Factors at the premises hereinabove m...

Factor's Agreement - Another Form. Part 3: (h) To give the Factors immediate notice of the return of any merchandise. (i) To permit the Factors to examine all of the Customer's books at all reasonable business hours, as frequently as the Fa...

Factor's Agreement - Another Form - Principal Engaged in Selling Merchandise both on its Own Account and as Agent for Others: Agreement made this..........day of.............., by and between............, copartners doing business under the firm name and style of............, hereinafter called the Factors, and............

Factor's Agreement. Principal Engaged in Selling Merchandise both on its Own Account and as Agent for Others. Part 2: b. The Factors hereby guarantee the payment of all accounts arising from the sale of said merchandise approved by them, provided the merchandise so sold is finally accepted by the respective purchaser...

Principal Engaged in Selling Merchandise both on its Own Account and as Agent for Others. Part 3: 11. In the event that the Principal shall be adjudicated a bankrupt or shall file a petition in bankruptcy or shall make a general assignment for the benefit of creditors or shall have a receiver appo...

Deed of Trust - Agreement Between Debtor and Creditors for Management of Business by Trustees: Agreement made this .....day of............by and between..............., of............, hereinafter referred to as the Debtors,...................., hereinafter referred to as the Trustees/'........

Agreement Between Creditors and Embarrassed Solvent Debtor Providing for Extension - Formation of Corporation Controlled by Creditors: Agreement made this day of January, 1922, between ............of............hereinafter for convenience designated as the Debtor, and all creditors of the Debtor, who shall hereafter sign this agreeme...

Corporate Agreements - Stock Transactions: Agreement for Consolidation of Corporations under Laws of several States Continental Securities Company v. Belmont, 168 App. Div. 483,154 N. Y. Supp. 54. Affirmed 222 N. Y. 673, 119 N. E. 1036. ...

Article VIII: The manner of converting the capital stock of each of said consolidating corporations into that of said consolidated corporation, and the distribution of such of the stock of said consolidated corpora...

Article IX: The........ (......___) shares of the capital stock of.......... ..........owned by....................and to be cancelled as stated in Paragraph (b) of Article VIII of this agreement, are now held...

Article X: The first election of Directors, after the consolidation shall have been effected, shall be held at the principal office of the consolidated corporation at such time, not more than six months after th...

Article XI: To the extent permitted by law, said consolidated corporation shall have authority to purchase, acquire, hold and dispose of the stocks, bonds, notes and other evidences of indebtedness of any corpora...

Agreement Creating Trust of Stock of Equitable Life Assurance Society of United States: An Agreement, made in the City of New York, in the State of New York, this fifteenth day of June, one thousand nine hundred and five, between Thomas F. Ryan, of the first part, and Grover Cleveland, M...

Voting Trust Agreement: Agreement made........between........, a corporation organized and existing under the laws of........, and any other stockholders of.......,.......who shall become parties to this agreement by signing...

Pledge of Stock to Secure Loan: Agreement made................between............. ............hereinafter called Mr........................ and.....................................hereinafter called the Bankers, Witnesseth: ...

Contract between Stockholders of Corporation for Control of Stock: Agreement, made................day of.............., 19.., by and between......................, and......... all of the Borough of the............, City of.............. and State of...........

Underwriting Agreement: Agreement made ................between............ ....___ and................, together hereinafter called the Managers, and the subscribers hereto, severally, of whom each is hereinafter terme...

Underwriting Agreement. Continued: 3. For all payments made hereunder each subscriber shall receive stocks or a receipt or certificate signed by the Managers, or on their behalf by one of the firms constituting the Managers, in such fo...

Stockholders' Committee - Deposit Agreement: Agreement, made....................between........ ............ and their successors (hereinafter called the Committee), and such holders of the shares of the........ stock of.................

Stockholders' Committee - Deposit Agreement. Part 2: In furtherance and not in limitation of any of the other provisions hereof and of the powers and authority vested in the Committee hereunder, the Depositors do hereby give and grant unto the said Comm...

Stockholders' Committee - Deposit Agreement. Part 3: 10. The Depositary shall be entitled to such compensation for its services as depositary as the Committee shall fix by agreement with it. All directions or instructions given by the Committee to, or p...

Stockholders' Committee - Deposit Agreement. Part 4: In the absence of any such express dissent filed by any such Depositor, assent to and ratification of any such plan shall be conclusively and finally assumed and is hereby expressly conferred and irre...

Deposit Agreement - Contemplating Plan of Reorganization: Another Form Agreement made this........................between such holders of the....................Bonds of.......... ..........(hereinafter called the Company), due on or before.............

Deposit Agreement - Contemplating Plan of Reorganization. Part 2: 7. The Committee may exercise as to all of such bonds, debentures, preferred stock, claims and rights, all rights incidental to the ownership thereof, and any and all rights and powers appertaining to...

Deposit Agreement - Contemplating Plan of Reorganization. Part 3: 10. The Committee may make such expenditures and incur such indebtedness, obligations and liabilities as it, in its uncontrolled discretion, may deem judicious and expedient in order to carry out full...

Deposit Agreement - Contemplating Plan of Reorganization. Part 4: 15. For the purpose of securing funds necessary for the payment of the expenses and liabilities of the Committee, or to pay liens, charges, demands or assessments upon or in respect to, or otherwise t...

Deposit Agreement - Contemplating Plan of Reorganization. Part 5: g. For the raising of any sums in cash deemed by the Committee in its uncontrolled discretion to be necessary or expedient for any of the purposes of the reorganization or readjustment of the Company,...

Deposit Agreement - Contemplating Plan of Reorganization. Part 6: 27. The Committee, as at any time constituted, and notwithstanding any vacancy, shall have all the powers, rights and interests of the Committee as originally formed. The Committee may from time to ti...

Deposit Agreement - Contemplating Plan of Reorganization. Part 7: All amendments shall be filed with the Depositary; but, if in the judgment of the Committee, which shall be conclusive and binding, any such amendment shall materially affect the rights of holders of ...

Deposit Agreement - Contemplating Plan of Reorganization. Part 8: Par Value and Class of Obligations Deposited Hereunder Bonds Debentures Preferred Stock and Rights to Common Stock $ $ ...

Deposit Agreement - Contemplating Plan of Reorganization. Part 9: ..................................................... Depositary. By............................ Vice-President. ..................................... Assistant Secretary. (Reverse.) ...

Deposit Agreement - Option to Purchase Stock: Deposit Agreement dated.........................., between....................(hereinafter called Mr. X.), ..........................., and such other holders of the preferred stock of................

Deposit Agreement - Option to Purchase Stock. Part 2: 2. Mr. X. has simultaneously with the execution of this agreement deposited with the Depositary said.......... shares of preferred stock properly endorsed in blank and stamped for transfer. Said sh...

Deposit Agreement - Option to Purchase Stock. Part 3: (c) Upon any such purchase and transfer the shares so purchased shall, subject to the provisions of paragraph 5 hereof, be taken ratably from the shares to the credit of, and shall be charged against,...

Protective Agreement - Deposit of Bonds with Committee to Avoid Foreclosure of Mortgage: Agreement, made....................between......... ..............................and their successors, as a Protective Committee for...............Bonds of.......... ..........(hereinafter c...

Protective Agreement. Deposit of Bonds to Avoid Foreclosure of Mortgage. Continued: 4. The deposit of bonds hereunder or acceptance of a certificate of deposit therefor will be deemed the equivalent of execution of this agreement and all Depositors will be subject to and bound by the...

Agreement Between Creditors of Bankrupt Corporation for Joint Action to Protect Mutual Interests: Agreement made............, between such of the unsecured creditors of.............., hereinafter called the Corporation, as shall become parties to this agreement, hereinafter called the credit...

Reorganization Agreement - Railroad Company: Agreement dated.............., between.............. (herein called the Reorganization Managers)............. and a Reorganization Committee of..............(hereinafter called the Old Compan...

Reorganization Agreement - Railroad Company. Part 2: 8. The Reorganization Managers may determine who are or shall be creditors under the Plan (subject to the adjustments already made with certain creditors) and the terms and manner in which creditors m...

Reorganization Agreement - Railroad Company. Part 3: 14. In their discretion the Reorganization Managers may fix or limit any period or periods within which any deposits may be made as herein provided (subject to the provisions in that behalf in the Pla...

Reorganization Agreement - Railroad Company. Part 4: 16. The Reorganization Managers may organize or procure to be organized one or more new companies, or they may adopt or use any company or companies, whether now existing or not, and they may cause to...

Reorganization Agreement - Railroad Company. Part 5: 20. The Reorganization Managers may proceed under the Plan and Agreement, or any part thereof, with or without judicial sale, and in case of judicial sale they may exercise any power hereby conferred ...

Reorganization Agreement - Railroad Company. Part 6: 24. The Reorganization Managers for the purposes of and in conformity with the Plan may dispose of, or consent to the disposition of, any new securities not required for delivery to Depositors, and ma...

Reorganization Agreement - Railroad Company. Part 7: 34. All securities and claims deposited under or subject to the Plan and Agreement, and all securities and claims purchased or otherwise acquired thereunder, shall remain in full force and effect for ...

Contract for Formation of Corporation-Exclusive Services to be Rendered By One of The Parties - Transfer of Stock: Watson v. Gugino, 204 N. Y. 535, 98 N. E. 18. Agreement made.........., between.............hereinafter called the Present Owner and..........hereinafter called the Investor: Whereas, the sa...

Trust Agreement - Stock in Corporation - Provision for Continuation by Successor Trustee of Separate Partnership of Trustee: Agreement, made this............day of.............. by and between....................hereinafter described as the Trustee, and....................hereinafter described as the Stockholders, an...

Trust Agreement. Provision for Continuation by Successor Trustee of Separate Partnership of Trustee. Continued: (f) The purpose of this trust is to continue the business of the Company in the same manner as it is at present conducted, giving the Stockholders and their successors in interest, however, a benefici...

Agreement for Purchase of Stock in Corporation - Payment of Part of Purchase Price from Dividends - Restrictions against Alienation: Agreement, made....................between........ ..............., hereinafter described as the Seller and ................of...............hereinafter described as the Purchaser. Wherea...

Salesmen's Contracts. Contract Employing Salesman - Exclusive Agency - Limited Territory - Drawing Account Provision with Agreement to Repay Unearned Drawings - Option for Renewal: Williston - Sections 43, 90, 1015n. Agreement made ................between............ ........hereinafter described as the Employer, and........ ........hereinafter described as the Salesman...

Contract between Employer and Salesman - Furnishing Bond - Repayment of Overdrawn Commissions - Collection of Moneys for Principal: Williston - Sections 43, 90, 1015n. Agreement made...............by................... hereinafter called the Employer, and................hereinafter referred to as Salesman, Witnesseth: 1. ...

Salesman's Contract - with Authority to Employ Sub-salesmen: Williston - Sections 43,90,1015n. Agreement made..........between................... hereinafter called the Employer, and...................... residing at...........................hereinaft...

Employers' Contracts With Executives: Employer and Manager, with Provision for Share of Profits to be Paid Partially in Stock of Company - To Continue from Year to Year unless earlier terminated. Williston, Sections 90, 104, 140, 495, ...

Contract Of Employment Of Executive With Provision For Sharing Of Profits As Compensation: Williston - Sections 1028, 1030, 1358-1362; Ballenberg v. Wahn, 103 App. Div. 34, 92 N. Y. Supp. 380; Hathaway v. Clendening, 135 App. Div. 407,119 N. Y. Supp. 984; Agreement made..........be...

Contract of Employment of Executive with Provision for Sharing of Profits as Compensation - Another Form: Heaphy v. Eidlitz, 197 App. Div. 455, 189 N. Y. Supp. 431. Agreement made............between...........hereinafter designated as the Employer, and ............, hereinafter designated as the Manager, ...

Employment Contract - Of General Manager by Corporation - Provisions for Elimination of Manager from Control, Salary to Continue - Stock Payments in Escrow: Agreement dated..............between............... (hereinafter called the Employer) and.............., of ..............(hereinafter called Employee). The parties agree: 1. The Emplo...

Agreement for Employment of Manager of One of Chain of Retail Stores - Cash Deposit as Security - Term of Employment as Long as Employment Satisfactory: Agreement made this........day of................ between...................., hereinafter described as the Employer and...................., hereinafter described as the Manager, Witnesseth ...

Employment Of Actors Contract - Actor And Manager: Williston, Sections 850n., 1015, 1450. Broughton v. Kalich, 185 N. Y. Supp. 318. Agreement made between......................(hereinafter called Manager) and..............(hereinafter called Act...

Termination By Closing Of Play Or Company: Actor for all services rendered from the date of first public performance, and in no event not less. b. If the play shall run more than four weeks, the Manager shall give one week's notice of the c...

Agreement Of Employment: 1. The Actor and the Manager agree that this contract is entered into independently of any other contract between any Equity member and any producer and of any other contract or contracts, affiliation...

Individual Termination: 6. Either party may terminate this contract at any time on or after the date of the first public performance of the play by giving the other party two weeks' written notice. Termination By Closing ...

Duties Of The Actor: 16. The Actor agrees to be prompt at rehearsals, to pay strict regard to make-up and dress, to perform his services in a competent and painstaking manner, to abide by all reasonable rules and regulati...

Contracts Of Employment Respecting Real Property: Contract Granting Exclusive Agency to Rent Real Estate. Williston - Sections 60, 460, 1012, 1406, 1446, 1645; Moses v. Bierling, 31 N. Y. 462; Shultz v. Griffin, 5 Misc. 499, 26 N. Y. Supp. 7...

Contracts For Dramatic Productions: Standard Form of Minimum Dramatic Contract for Production of Play, Adopted by the Authors9 League of America, Inc., and the Producing Managers' Association1 Williston - Sections 850, 1015, 1450; ...

Standard Form of Minimum Dramatic Contract for Production of Play, Adopted by the Authors' League of America, Inc., and the Producing Managers' Association: Williston - Sections 850, 1015, 1450; This agreement made and entered into this..........day of............., 19.., by and between..................., hereinafter referred to as the Manager, and......

Agreement between Author and Producers for Production of Play: Heme v. Iiebler, 73 App. Div 194, 76 N. Y. Supp. 762. Agreement made this........day of........, between ............and............, constituting the firm of..... ......, hereinafter describ...

Author And Publisher. Contract between Author and Publisher for Legal Work: Williston, Sections 413, 1940, 1980; Jones v. American Law Book Co., 125 App. Div. 519, 109 N. Y. Supp. 706. Agreement made........between........hereinafter described as the Publisher, and........

Agreement for Publication of Book, Author Reserving Copyright and Receiving Royalties: Another form. Williston, Sections 413,1940 and 1980. Agreement made....... .between............hereinafter called the Author, and..........hereinafter called the Publisher, WITNESSETH: 1. The...

Author and Publisher - Another Form: Williston, Sections 413, 421, 841, 940, 1980. Agreement made between..........hereinafter called the Publisher, and..........hereinafter called the Author: 1. The Author agrees to prepare and...

Contract between Author and Publisher for Sale of Manuscript with Right to Copyright.: Williston - Sections 421, 841, 1940 and 1980. Agreement made............. between ............ hereinafter called the Author, and............., hereinafter called the Publisher, Witnesseth: W...

Employment Contracts - Miscellaneous Agreement For Services Of Baseball Player: Williston, Sections 432 and 1450. Griffin v. Brooklyn Ball Club, 68 App. Div. 566, 73 N. Y. Supp. 864 (aff'd.) 174 N. Y. 535, 66 N. E. 1109. AGREEMENTm ade........between...............hereinaft...

Employment Contracts. Agreement For Services Of Baseball Player. Continued: 8. It is agreed, that should the Player become ill or disabled, as provided in the last preceding paragraph, he, whenever and as often as he may be requested so to do by the Employer, or its assigns, ...

Labor Protocols: The Hart, Schaffner & Marx Labor Agreement1 Williston - Sections 1654-1656. Preamble By Mr. E. J. Williams, Chairman of The Board of Arbitration 1. The parties whose names are signed hereto p...

Section I: 7. Administration. This agreement is entered into between Hart, Schaffner & Marx, a corporation, and the Amalgamated Clothing Workers of America, and is effective from May 1st, 1916, to April 30th, 19...

Section II Procedure: 31. When Grievances Arise. When a grievance arises on the floor of the shop, the complainant shall report it with reasonable promptness to the shop representative, who shall present it without undue d...

Section III Rates And Hours: 43. Schedules of Piece Work Rates. The prices and rates of pay that are to be in force during the life of this agreement are set forth in the schedules prepared for that purpose, duly authenticated by...

Section IV Preference: 53. The Preferential Shop. It is agreed that the principle of the preferential shop shall prevail, to be applied in the following manner: 54. Preference shall be applied in hiring and discharge. Wh...

Section V Working Conditions: 62. Discipline. The full power of discharge and discipline remains with the company and its agents; but it is understood that this power should be exercised With justice and with due regard to the rea...

Section VI General Provisions: 69. Lay Off of Workers. No union member who is a permanent worker shall be laid off in the tailor shops except for cause, whether in the slack or busy season, except as provided herein. Cause for temp...

Section VII Loyalty To The Agreement: 78. Experience suggests that there are certain points of strain which it would be wise to recognize in advance and to safeguard as far as possible. Among the points to be safeguarded are the following...

Section VIII. Cutting And Trimming Departments: 79. The cutting and trimming departments shall be subject to the general provisions of this agreement, and to the bases and provisions of the old agreement, except as they may be modified by, or found...

Section VIII. Cutting And Trimming Departments. Part 2: Williston, Sections 1654-1656 Agreement BETWEEN Manhattan Silk Co., College Point, L. I. Smith & Kaufmann, Inc., New York City. Elandes Ribbon Co., Inc., Whitestone, N. Y. Star Ribbon Mfg. Co., ...

Section VIII. Cutting And Trimming Departments. Part 3: Section 5. Impartial Chairman. There shall be selected by the signers to this agreement as soon after the signing of the agreement as possible, a person agreed upon to serve as Impartial Chairman, who...

Section VIII. Cutting And Trimming Departments. Part 4: Section 7. Compensation of Weavers, a. The Impartial Chairman after a thorough investigation and study shall make a full report and issue rulings if found advisable, as to the basis and amount of comp...

Section VIII. Cutting And Trimming Departments. Part 5: In Witness Whereof, the parties hereto have signed and executed this agreement as provided under Section 1 hereof, this 10th day of April, in the year One thousand nine hundred and twenty. Certific...

Section VIII. Cutting And Trimming Departments. Part 6: VI The principle of week work is approved. The definite arrangements which shall be worked out jointly under the decision of the Referees during the next year, shall have due regard to the producti...

Section VIII. Cutting And Trimming Departments. Part 7: (5) That, recognizing the necessity for providing reasonable methods for deciding controversies or grievances, both parties agree to the appointment of a Board of Arbitration, to be selected as follow...

Section VIII. Cutting And Trimming Departments. Part 8: (18) That the Union agrees that where the employee acts unfairly with the employer that he or she will be disciplined by the Union. (19) That the union agrees that it will bend its energies to enfo...

Section VIII. Cutting And Trimming Departments. Part 9: (1) Forty-four (44) hours shall constitute a week's work in the cutting, trimming, coat, trousers and vest shops. (2) Overtime shall be dispensed with so far as possible. Whenever a department or s...

Agreement - Clothing Exchange of Rochester and Amalgamated Clothing Workers of America: Entered into between the Clothing Exchange of Rochester, represented by Mr. Max Holtz and Mr. Samuel Weil, and the Amalgamated Clothing Workers of America, represented by Mr. Sidney Hillman. The Op...

N. Y. Clothing Trade Association Preamble: The parties hereto enter into an agreement for collective bargaining with the intention of agreeing on wage and working conditions and to provide a method for adjusting all differences that may arise ...

Protocol Agreement between Cloak, Suit and Skirt Manufacturers' Protective Association and Various Labor Unions: Williston, Sections 1664 - 1656. Protocol of an agreement entered into this 2nd day of September, 1910, between the Cloak, Suit and Skirt Manufacturers' Protective Association, herein called the ma...

Lease of Building for Long Term with Clauses Appropriate for Use in other Leases, Indexed and Annotated: Williston, Sections 90n., 493n., 690n., 725n., 761n., 890-892, 926n., 1386n., 1403-1404, 1766, 1812, 1856, 1931, 1940, 1967, 1985. INDEX 1. Term and Premises. 2. Rent. 3. Conditional Limit...

Lease of Building for Long Term Appropriate for Use in other Leases. Part 2: 5. Covenant to Repair. The Tenant covenants during the term of this lease to keep in good order and repair, inside and out, all buildings and structures which are now or shall hereafter be constructed...

Lease of Building for Long Term Appropriate for Use in other Leases. Part 3: 2B. R. C. 805; Barrington v. Watson, 38 Hun, 535; Re Pennewell, 119 Fed. 139; Kramer v. Amberg, 53 Hun, 427, 6 N. Y. Supp. 303; Rouiaine v. Simpson, 84 N. Y. Supp. 875; Fischer v. Ginzberg, 191 App. D...

Lease of Building for Long Term Appropriate for Use in other Leases. Part 4: Mann v. Munch Brewery, 225 N. Y. 189, 121 N. E. 746, Rev. 173 App. Div. 746,160 N, Y. Supp. 314; McCready v. Lindenborn, 172 N. Y. 400, 65 N. E. 208; Michaels v. Fishel, 169 N. Y. 381, 62 N. E. 425...

Lease of Building for Long Term Appropriate for Use in other Leases. Part 5: Bushe v. Wolff, 171 N. Y. Supp. 253. 19. Provision Against Waiver. The failure of the Landlord to insist upon strict performance of any of the covenants or conditions of this lease or to exercise a...

Lease of Building for Long Term Appropriate for Use in other Leases. Part 6: Nothing contained in this clause shall in any way diminish or be construed to waive any of the Landlord's other remedies, and the deposit of $........shall in no event be applicable to any rent due or...

Lease Providing for Erection of Building by Landlord: Agreement made........, between..............., and hereinafter called the Landlord, and..............., hereinafter called the Tenant Witnesseth: 1. The Landlord for and in consideration of th...

Lease Providing for Erection of Building by Landlord. Continued: 20. It is agreed that no surrender of the premises or of the remainder of the term herein, shall be valid unless accepted by the Landlord in writing. 21. All notices to the Tenant or the Landlord h...

Long-time Lease with Provision for Erection of Building by Tenant and Index to Clauses: INDEX 1. Covenant of title............ 2. Rent....................... 3. Gold coin................... 4. Demands (for payments)..... 5. Existing buildings........... 6. New building....

Long-time Lease with Provision for Erection of Building by Tenant. Part 2: .........., then the Tenant, before seeking to contest and postpone such claims, shall furnish to the Landlord a satisfactory bond or other security conditioned upon the payment of such disputed claim...

Long-time Lease with Provision for Erection of Building by Tenant. Part 3: insured against loss or damage by fire, lightning or tornado, for not less than the amount for which said buildings or improvements shall be assessed for the purposes of taxation for the year............

Long-time Lease with Provision for Erection of Building by Tenant. Part 4: 7. The Tenant covenants that it will, throughout said term at its own expense, make and do all repairs of all kinds, both inside and outside (except repairs made necessary by fire, or by damage by the...

Long-time Lease with Provision for Erection of Building by Tenant. Part 5: 20. Landlord's Liens. The Tenant agrees and covenants that the whole amount of the rent reserved and hereby agreed to be paid by it and each and every instalment thereof, and the amount of all the wat...

Long-time Lease with Provision for Erection of Building by Tenant. Part 6: The Landlord agrees that if the leasehold estate hereby-demised shall be conveyed by mortgage or deed of trust by the Tenant as herein provided, and if the Landlord shall be notified in writing of suc...

Long-time Lease with Provision for Erection of Building by Tenant. Part 7: (A) To the payment of the cost, maintenance and operation of the demised premises and the buildings and improvements thereon, including a reasonable compensation to the said Landlord and agents, attor...

Long-time Lease with Provision for Erection of Building by Tenant. Part 8: If either the Landlord or the Tenant shall fail to choose an appraiser so to act after thirty (30) days' notice in writing from the other party so to choose, then the other party may apply to any Judg...

Long-time Lease with Provision for Erection of Building by Tenant. Part 9: If from any cause the appraisals of the said buildings and land shall not have been made...................days prior to...................., if there has been no written agreement of the actual cash ...

Lease of Co-operative Apartment: Agreement, made.........., between..............., hereinafter called the Landlord, and..............., of ............., hereinafter called the Tenant, Witnesseth: Whereas, certain of the s...

Lease of Co-operative Apartment. Part 2: 4. This lease is made, executed, delivered and accepted by the Tenant upon the express condition that the same shall cease, determine and become null and void upon the happening of either or all of th...

Lease of Co-operative Apartment. Part 3: d. The Tenant will observe and comply with, and the Tenant agrees that all persons dwelling in or visiting in the demised premises, will observe and comply with the rules and regulations printed on th...

Lease of Apartment in New York City: Agreement made the....................day of....... ........in the year one thousand nine hundred and......... between................................................ ...........................

Lease of Apartment in New York City. Part 2: It is mutually understood and agreed, in case it shall become necessary at any time in the judgment of the lessor, to omit or suspend the operation of the elevators, the heating apparatus or other por...

Lease of Apartment in New York City. Part 3: 13. That if the demised premises be in a building where the Lessor shall desire to supply the electric current to the Lessee , the Lessee hereby agrees to use no other current than that supplied by th...

Lease - Simple Form: Agreement made.........., between................, hereinafter designated as the Landlord, and..............., hereinafter designated as Tenant. 1. The Landlord hereby lets to the Tenant, and the T...

Lease - Simple Form. Continued: Federal Government and Boards of Fire Underwriters, it being agreed, however, between the parties hereto, that the Tenant is not required to make any substantial structural changes. All alterations an...

Farm Lease Contract (Livestock in Partnership): Prepared by Professor Lynn Robertson and M. L. Fisher of Purdue University. This Agreement made this.....day of............19.., by and between............, lessor, and...............', lessee. ...

Farm Lease Contract (Livestock in Partnership). Continued: Section 9. Poultry. All poultry kept on the farm shall be owned in partnership. Lessee shall be allowed poultry and eggs for family consumption only on this farm. The receipts from all poultry and egg...

Notes on Crop Share Farm Lease: (Notes and Lease prepared by Professors Lynn Robertson and M. L. Fisher of Purdue University. In this crop share lease the tenant is given special inducement to keep livestock. One of the greatest ...

Farm Lease Contract: Crop Share (Livestock Encouraged). This agreement, made........, 19.., between.......... .....of.........., lessor, and..............., of.......... lessee, Witnbsseth, that the said lesso...

Lease of Department in Department Store: Agreement made..........between..................., hereinafter called the Main Store, and..............., hereinafter called the Department, Witnesseth: Whereas, the Main Store is desirous of leas...

Lease of Department in Department Store. Continued: ..........dollars in each year and that at the end of each week an accounting and settlement shall be made and if the sales of said Department shall be more than.........dollars for said week, the Mai...

Motion Picture Contracts. Employment Contract - Motion Picture Director: Agreement, made and entered into this......day of___ ..........., by and between........, a corporation duly organized and existing under and by virtue of the laws of the State of..........., he...

Employment of Actor for Motion Picture: Agreement made.........between..............hereinafter designated as the Employer, and...........hereinafter designated as the Employee. Whereas, the Employee is a motion picture actor and the Emp...

Contract with Salesman to Procure Rentals of Motion Pictures: Agreement, made this..........day of................, between___......................, (hereinafter designated as the Principal), and................................, ................................

Contract for Production and Distribution of Motion Pictures: Agreement made this........day of........, between........of........, hereinafter referred to as the Distributor, and........of........, hereinafter referred to as the Producer, Witness-eth: 1. (a)...

Contract for Production and Distribution of Motion Pictures. Part 2: (b) The main title of each photoplay shall carry the seal of approval of the National Board of Ownership of Prints Still Photographs. Place of Delivery. Cutting and Censorship. Review. ...

Contract for Production and Distribution of Motion Pictures. Part 3: not form any part of the receipts or royalties from the Canadian or foreign exploitation of such photoplays, and the Producer shall not participate in any amount so received by the Distributor. (e)...

Contract for Production and Distribution of Motion Pictures. Part 4: (Additional provision) [The following provision may be inserted in this clause, and the other clauses correlated therewith]: For the purpose of determining the cost of production of the negative...

Contract for Production and Distribution of Motion Pictures. Part 5: 12. Producer hereby covenants, warrants and guarantees that each photoplay delivered to Distributor hereunder shall be capable of copyright in the United States of America; that the Producer will not ...

Sale of Foreign Rights of Film: Agreement made..........between..........hereinafter designated as the Producer, and.........hereinafter designated as the Distributor: WITNESSETH: Whereas, the parties desire to contract fo...

Sale of Foreign Rights of Film. Part 2: 7. The Distributor shall pay to the Producer for the use of the prints of said production a sum equal to........(... %) per cent of the gross amounts paid by exhibitors as rental for each print and of...

Sale of Foreign Rights of Film. Part 3: 13. The Producer shall supply to the Distributor first class lithographs of each production printed in the English language, at........per sheet, in such quantities as may be required by the Distribut...

Purchase from Author of Motion Picture Rights of an Original Unpublished Work: Know All Men BY These Presents, that I,.......... ..........of...................., in the State of......... ...........for and in consideration of $............, the receipt of which sum is her...

Purchase of Motion Picture Rights to a Published Magazine Story: Know All Men By These Presents, that I.............. of..............., in the State of..............., for and in consideration of $.........., paid to me by.......... .........., the receipt w...

Purchase from the Author of All Rights to an Original Unpublished Work: Know All Men By These Presents, that I,............ .........., of..............., in the State of............. for and in consideration of $....................., the receipt of which sum is he...

Partnership Agreements: Partnership Contract, General Form, With Provision for Continuation of Firm after Withdrawal of One Partner and Option to One Continuing Partner to Retire upon Notice and Become Special Partner. Wi...

Partnership Agreements. Continued: in said business, and to which the Third Partner shall contribute his remaining one-half interest, to be determined as aforesaid, as a special partner, such partnership to be for a period of........, ...

Partnership Agreement - Continuation of Firm in Event of Death of One Partner - Control by One Partner - Rights of Legal Representatives of Deceased Partner: Partnership Agreement made this......day of........ ........, between..............., ...................., ..............., all of the City of New York. In consideration of the agreements he...

Partnership Agreement - Expiration on One Tear's Notice of Cancellation - Contributions to Capital Treated as Loans - Division of Profits - Drawing Accounts - Death of Partner - Capital to Remain in Firm - Payments to Estate of Deceased Partner - Use of Firm Name on Dissolution: Partnership Agreement, made this......day......... of........, 1916, between...............,..............., ..............., all of the City of............, and..... .........., of.............

Partnership Agreement - Partners to Devote Time to Partnership Exclusively - No Speculative Ventures Without Knowledge of Other Partners - Legal Representatives to Assume Rights and Liabilities of Deceased Partner but with no Voice in Business: Agreement made....................between......... .............................................................................................. Whereas, the parties above named intend to form ...

Partnership Agreement - Partners Admitting Employees as New Members - Partners Retaining Ownership of Present Assets and Good-will - Drawing Accounts - Death of One of Partners: Agreement, made...................., between...... .............., hereinafter described as the Present Partners, and........................., hereinafter described as the New Partners, severa...

Partnership Agreement - Senior Member Owning All Assets and Directing Financial Affairs and Business of Partnership - Payments to Estate of Deceased Partner - Use of Firm Name: Agreement made..............between.............., hereinafter described as the Senior Member,............., hereinafter described as the Other Present Partners and .............., hereinafter describ...

Limited Partnership - General Form - Special Provisions: Agreement, made this........day of.........., 19.., between.............., hereinafter described as the General Partners and.............., hereinafter described as the Special Partner. WITNE...

Partnership Agreement - Miscellaneous Provisions of Special Nature: Agreement dated..............between..............., hereinafter referred to as the First Partner, and..........., hereinafter referred to as the Second Partner. WITNESSETH: 1. The First Par...

Agreement for Dissolution of Partnership - Simple Form: Agreement made this..............., between.......... (stating names and addresses of various partners) WITNESSETH: That for and in consideration of the sum of One Dollar ($1.00) to each of t...

Agreement for Dissolution of Partnership - Assignment of Some of Assets - Equalization of Capital Contributions-Accounting: Agreement made this ___day of......... by and between ..........hereinafter described as the First Partner and......, hereinafter described as the Second Partner. In consideration of the sum of One...

Purchase by Surviving Partner upon Death of Partner: Agreement made...................., between........ and........., Witnesseth: Whereas we are and have been for some time past partners doing business under the firm name of.........., and desire...

Contracts Affecting Real Property. Contract for Purchase and Sale of Real Property: Form used by Lawyers Title & Trust Company of New York.2 Williston, Sections 411, 430, 487, 488, 494, 519, 523, 578, 586, 675, 723, 729, 767, 791, 841, 847, 852, 853, 854, 923, 924, 925, 926 note, ...

Contract for Exchange of Real Property: Form prepared and used by Lawyers Title & Trust Company of New York.1 Williston, Sections 411, 430, 487, 488-494, 519, 523, 578, 586, 675, 723, 729, 767, 791, 841, 847, 852, 853, 854, 923, 924, 925...

Contract for Sale of Real Estate, reserving Right of Seller to Cancel in the Event of his Failure to Acquire Title: Agreement made.........., between.................., hereinafter described as the Seller, and....................., hereinafter described as the Purchaser; Witnesseth: 1. The Seller agrees to sell ...

Contract for Purchase of Building to be Constructed: Agreement, made and dated....................,....., between .........., residing at ............, hereinafter described as the seller and..........., residing at.........., herein described as the pu...

Agreement for Participation of Interest in Mortgage: Form prepared and used by Lawyers Title & Trust Company of New York. Thomas v. Zahke, 181 App. Div. 173,168 N. Y. Supp. 396; Clare v. N. Y. life Ins. Co., 178 App. Div. 877, 166 N. Y. Supp. 95; ...

Agreement Subordinating Mortgage: Form prepared and used by Lawyers Title & Trust Company of New York. This Agreement, made the........day of..........., one thousand nine hundred and......, Between .............................

Building Loan Contract: Form prepared and used by Lawyers Title & Trust Company of New York. Agreement, made this........day of........., 19..., BETWEEN............................................... hereinafter referr...

Building Loan Contract. Continued: VI. That the lender may cause said loan to be made by some other person or corporation. That the Bond and Mortgage shall then run to said person or corporation. That the provisions of this Agreement s...

Agreement Extending Time for Payment of Mortgage: Form prepared and used by Lawyers Title & Trust Company of New York. Williston, Sections 122, 593-595, 1190, 1222-1230. Agreement, made the............day of............... nineteen hundred a...

Collateral Bond to Secure Payment of Mortgage: Form prepared and used by Lawyers Title & Trust Company of New York. Know all Men by these Presents, That............ ...........................hereinafter designated as the obligor,..........h...

Separation Agreements: Williston, Sections 355n., 781n., 841n., 1472n., 1742-1744. Johnson v. Johnson, 206 N. Y. 561, 100 N. E. 408; Winter v. Winter, 191 N. Y. 462, 84 N. E. 382; Spense v. Woods, 134 App. Div. 182, 000 N. ...

Separation Agreement - Provision for Reduction of Payments in Proportion to Reduced Income of Husband: Agreement made........between........hereinafter referred to as the Husband, and........., hereinafter referred to as the Wife, Witnesseth: Whereas, the parties hereto are Husband and Wife, and bec...

Separation Agreement - Trustee - Common Law Form: Agreement made........between........hereinafter described as the Husband and........his wife, hereinafter described as the Wife, and........Trustee of said Wife, hereinafter described as the Trus...

Separation Agreement with Provision for Support of Children; Insurance of Life for Benefit of Wife and Children; Lease of Apartment by Husband for Use of Wife and Children: Stoddard v. Stoddard, 227 N. Y. 13; 124 N. E. 91. Agreement made....................between........., hereinafter referred to as the Husband, and................, hereinafter refined to as the Wife...

Separation Agreement: Agreement made.................., hereinafter referred to as the Husband, and.........., hereinafter referred to as the Wife, Witnesseth: Whereas, the parties are husband and wife and irreconcilabl...

Separation Agreement after Commencement of Action: Agreement made............................, between ..................., hereinafter referred to as the Husband, and....................of......................., hereinafter referred to as the Wif...

Miscellaneous Clauses. Clauses Relieving From Performance For Various Causes: Williston - Section 1968; also Sections 1931-1979. Columbia Law Review, November, 1920, Vol. 20, No. 7, p. 776; Sparks v Brown, Inc., 184 N. Y. Supp. 557. Sellers are not liable for any default or...

Clause Excusing Delivery for Shortage of Labor: Rosenstein et al. v. Farish Co., Inc., 185 N. Y. Supp. 42; Krulewitch v. National Importing & Trading Co., 195 App. Div. 544, 186 N. Y. Supp. 838. If......... .production.......... should be curta...

Clause Limiting Credit of Purchaser: Williston, Section 575. Wilton v. Berger, 196 App. Div. 121, 187 N. Y. Supp. 487; Lyonette v. K. Wilbur Dolson, 187 App. Div. 473, 175 N. Y. Supp. 789; Melnick v. Borden, 185 N. Y, Supp. 305....

Standard Form of Publishing Contract Approved and Published by Permission of the Authors' League of America: Williston, Sections 421, 841n, 1647, 1940, and 1980. (As a maximum contract, this form is planned to include all those clauses and stipulations which any author might urge at one time or another ...

Architect's Agreement on Cost plus Basis: Agreement made............between............hereinafter referred to as the Owner, and ..........hereinafter referred to as the Architect, as follows: 1. The Work Contemplated. The work for which t...

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