This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
The courts keep reiterating, in various forms of expression, that promises, in order to be enforceable, must be mutual.1 In other words, promises, in order to amount to a consideration, must each impose a legal liability upon the promisor by whom it is made.2 If such liability is imposed by each promise, the promises are enforceable, since each is a consideration for the other.3 A contract whereby B agrees to take charge of A's lands and to give as much time as might be necessary to the management and sale thereof, in consideration of which B is to receive one-half of the proceeds of all the sales, possesses mutuality, especially if such contract is under seal.4 A contract between A and B, by which A appoints B as his agent to sell A's goods for a specified time at a specified commission, and B agrees to use his best efforts to sell such goods, possesses mutuality.5 A similar contract, in which B agrees to pay a certain specified amount for the goods which A ships to B, to buy goods sufficient to supply the trade which he is able to create, to provide means for shipping such goods, to pay freight charges and advertising expenses, and to use his best endeavors to push the sale of such goods, possesses mutuality.6 While the term "mutuality" is frequently used in this connection, it is to be regretted that it has come into such general use. It is one of those inexact terms which sound so well and which mean so many different things, that its use confuses more than it aids.
29Pinkerton v. Hudson, 87 Ark. 506, 113 S. W. 36.
30Cooper v. Livingston, 19 Fla. 684.
31Cooper v. Livingston, 19 Fla. 684.
1 United States. Taber Lumber Co. v. O'Neal, 160 Fed. 596, 87 C. C. A. 498; Oakland Motor Car Co. v. Indiana Automobile Co., 201 Fed. 499, 121 C. C. A. 319.
California. German Savings & Loan Society v. McLellan, 154 Cal. 710, 99 Pac. 194; Harper v. Goldschmidt, 156 Cal. 245, 104 Pac. 451.
Colorado. Strauss v. Brier, 57 Colo. 65, 140 Pac. 183.
Georgia. Buick Motor Co. v. Thompson, 138 Ga. 282, 75 S. E. 354; Hall v. Edwards, 140 Ga. 765, 79 S. E. 852.
Idaho. Houser v. Hobart, 22 Ida. 735, 43 L. R. A. (N.S.) 410, 127 Pac. 997.
Illinois. Weaver v. Weaver, 109 111. 225; Vogel v. Pekoe, 157 111. 339, 30 L. R. A. 491, 42 N. E. 386; Schwerdt v. Schwerdt, 235 111. 386, 85 N. E. 613
[affirming Schwerdt v. Schwerdt, 141 III. App. 386].
Iowa. Neola Elevator Co. v. Kruck-man (la.), 171 N. W. 743.
Kentucky. Second National Bank v. Rouse, 142 Ky. 612, 134 S. W. 1121; Citizens' National Life Ins. Co. v. Murphy, 154 Ky. 88, 156 S. W. 1069.
Montana. Raiche v. Morrison, 37 Mont. 244, 95 Pac. 1061.
New York. New York v. Paoli, 202 N. Y. 18, 94 N. E. 1077; Grossman v. Schenker, 206 N. Y. 466, 100 N. E. 39.
North Carolina. Holt v. Wellons, 163 N. Car. 124, 79 S. E. 450.
Oklahoma. Baumhoff v. Oklahoma City Electric & Gas & Power Co., 14 Okla. 127, 77 Pac. 40; Crosbie v. Brewer, - Okla. - , 158 Pac. 388.
Oregon. Lemler v. Bord, 80 Or. 224, 156 Pac. 427.
Washington. Brown v. Brew, 99 Wash. 560, 169 Pac. 992. See Mutualiity and Consideration, by Henry Winthrop Ballantine, 28 Harvard Law Review, 121; Mutuality of Contracts; Promise for a Promise; Unilateral Contracts; Consideration, by Alfred F. Sears, Jr., 32 American Law Review, 409.
The form in which the doctrine of mutuality is stated has occasionally led to a misunderstanding of the effect of an offer which the promisor for a valuable consideration has agreed not to revoke for a certain length of time. During the time for which such offer is to remain open, there is no mutuality in the proper sense of the term, until the offeree has accepted such offer. From the nature of the transaction he is not bound to accept the offer, and he may never accept it. At the same time, such offer is irrevocable, since it is given for value,7 and lack of mutuality can not be urged by such a promisor who is seeking to revoke such offer.8
2McGowin Lumber & Export Co. v. R. J. & B. F. Camp Lumber Co., 192 Ala. 35, 68 So. 263; Neola Elevator Co. v. Kruckman (la.), 174 N. W. 743.
3Georgia. Zipperer v. Helmnly, - Ga. - , 97 S. E. 74.
Iowa. Mail & Times Pub. Co. v. Marks, 125 la. 622, 101 N. W. 458.
Kansas. Spencer v. Taylor, 69 Kan. 493, 77 Pac. 276.
Massachusetts. Milk v. Smith, 193 Mass. 11, 6 L. R. A. (N.S.) 865, 78 N. E. 765.
Michigan. Detroit United Ry. v. Smith, 144 Mich. 235, 107 N. W. 922.
Minnesota. Emerson v. Pacific Coast & Norway Packing Co., 96 Minn. 1, 113
Am. St. Rep. 603, 1 L. R. A. (N.S.) 445, 104 N. W. 573.
Oklahoma. Baumhoff v. Oklahoma City Electric & Gas & Power Co., 14 Okla. 127, 77 Pac. 40.
West Virginia. McGuire v. Old Sweet Springs Co., 73 W. Va. 321, 79 S. E. 350.
4 Mills v. Smith, 193 Mass. 11, 6 L. R. A. (N.S.) 865, 78 N. E. 765.
5 Emerson v. Pacific Coast & Norway Packing Co., 96 Minn. 1, 113 Am. St. Rep. 603, 1 L. R. A. (N.S.) 445, 104 N. W. 573.
6 Spencer v. Taylor, 69 Kan. 493, 77 Pac. 276.
From its nature, therefore, the doctrine of mutuality applies to contracts in which the consideration for the promise is itself a promise made in return therefor. As it is used with reference to the doctrine of consideration, it means little more than that the promise lacks consideration, although it is generally used in cases in which the lack of consideration is disguised in some way and in which a promise of some sort has been made by the adversary party which is offered as the consideration. It is said to mean that the contract is binding on both parties.9 As it is always unadvis-able to use two or more terms for the same legal idea, the use of the term "mutuality" should be avoided in this connection as unnecessary. There is, however, another disadvantage in using this term. Since it is sometimes used as equivalent to "bilateral" in the sense which the courts sometimes employ that term, and as distinguished from "unilateral" in the sense in which the courts sometimes employ that term,10 we find the same ambiguity in the use of the term "mutuality" that we find in the use of the term "unilateral."11