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.
Where the parties assume to make a contract in which a promise is the consideration for a promise, and the alleged contract is so worded that one of the promises does not impose any legal duty upon the party making it, such promise is not a consideration for the other promise.1 Physical acceptance by the promisee, of a written promise which imposes no liability upon him in terms, does not make such contract binding upon the promisee; and, therefore, it is not binding upon the promisor.2 This is what is often meant by saying that promises must be mutual. Illustrations of this principle are: an agreement that a manufacturer will sell all his goods in a given locality through A, who is to get a specified commission, A not agreeing to do anything with reference to such sales;3 a promise by A to furnish goods to B and to give to B an exclusive territory within which A would not furnish such goods to be resold by anyone else, if A may end such contract at will and if B has not agreed to buy any certain amount of goods;4 an employer's continuing a previous employment without being bound to continue it for any period of time;5 a promise to employ A where A is not bound to third person, where credit has not, on revocation of such guaranty, been extended to such third person;16 a promise to advance money if the adversary party finds it necessary to borrow it hereafter, no obligation to borrow being imposed;17 a promise by A to teach only such pupils as B may assign to him, B not agreeing to assign any;18 and a promise to drill a well for a certain sum, if not accepted by the adversary party so as fairly to import a promise on his part to have such well drilled and to pay such sum.19 A written statement by A, the owner of certain realty, the sale of which A and B had been discussing, to the effect that A would execute his deed to B, would mail it to A's broker, X, and that B must meet X at a certain time and place with the purchase price and accept such deed, is not a contract if B does not, by accepting it, bind himself to pay such money and to accept such deed.20 A promise to insure, which by its terms is to be inoperative under certain circumstances, is not a consideration if the circumstances thus specified in the contract were in existence when such contract was made.21 A promise whereby A agrees to convey land to B, but B does not assume any obligation on his part,22 or a promise by which A agrees to furnish goods to B, to be sold by B, but B does not undertake to do anything with reference to such goods,23 is in each case unenforceable for lack of consideration.
1 United States. Richardson v. Hard-wick, 106 U. S. 252, 27 L. ed. 145.
California. Stanton v. Singleton, 126 Cal. 657, 59 Pac. 146.
Illinois. Weaver v. Weaver, 109 111. 225; Vogel v. Pekoc, 157 111. 339, 30 L. R. A. 491, 42 N. E. 386; Krause v. Kraus, 162 111. 328, 44 N. E. 736; Allen v. Rouse, 78 111. App. 69.
Indiana. Louisville, etc., R. R. Co. v. Flanagan, 113 Ind. 488, 3 Am. St. Rep. 674, 14 N. E. 370.
Kansas. Heiland v. Ertel, 4 Kan. App. 516, 44 Pac. 1005.
Kentucky. Citizens' Nat. Life Ins. Co. v. Murphy, 154 Ky. 88, 156 S. W. 1069.
Louisiana. Kaplan v. Whitworth, 116 La. 337, 40 So. 723; Union Sawmill Co. v. Arkansas Southeastern Ry. Co.. 123 La. Ann. 555, 49 So. 173.
Michigan. McDonald v. Bewick, 51 Mich. 79, 16 N. W. 240; Davie v. Mining Co., 93 Mich. 491, 24 L. R. A. 357, 53 N. W. 625, 491; Jackson v. Sessions, 109 Mich. 216, 67 N. W. 315.
Minnesota. Stensgaard v. Smith, 43 Minn. 11, 19 Am. St. Rep. 205, 44 N. W. 669.
New York. Levin v. Dietz, 194 N. Y. 376, 87 N. E. 454.
Oregon. Rose v. Oliver, 32 Or. 447, 52 Pac. 176.
Wisconsin. Dodge v. Hopkins, 14 Wis. 630; Lowber v. Connit, 36 Wis. 176.
2 Levin v. Dietz, 194 N. Y. 376, 20 L. R. A. (N.S.) 251, 87 N. E. 454.
3 Benjamin v. Bruce, 87 Md. 240, 39 Atl. 810; Hirschhorn v. Drug Co., 26 Utah 110, 72 Pac. 386.
4 Rogers v. White Sewing Machine Co., - Okla. - , 157 Pac. 1044.
5 No consideration for a release of damages by the employee. Potter v. Ry., 122 Mich. 179, 81 N. W. 80, 82 N. W. 245; Purdy v. Ry. Co., 125 N. Y. 209, 21 Am. St. Rep. 736, 26 N. E. 255; Gulf, etc., Ry. v. Winton, 7 Tex. Civ. App. 57, 26 S. W. 770. But in Texas Midland Railroad v. Sullivan, 20 Tex. Civ. App. 50, 48 S. W. 598, a similar continue in the employment for any given period;6 a promise to do work assigned to the promisor where the adversary party is not bound by the promise to assign any work or to pay any compensation if no work is assigned;7 a promise to reconvey realty for a certain price without any corresponding obligation to purchase it;8 a promise by an assignee for the benefit of creditors to sell realty, to be good for a certain time subject to the approval of the court, where the court does not approve it till the time fixed has elapsed and the vendee has repudiated it;9 a promise to buy without a corresponding promise to sell;10 a covenant to convey at a certain price which does not impose upon the adversary party the duty of paying such price;11 a promise to convey certain realty on payment of a certain sum of money, if other realty has been sold, there being no promise, express or implied, to accept such conveyance and to pay such money;12 a promise to pay for water furnished where the adversary party is not bound to furnish any;13 a promise to sell without any corresponding promise to buy;14 a contract for the sale of cotton which contains a provision that the vendor will repurchase it from the vendee at the market price on the day fixed for delivery;15 a promise to guarantee the future debt of a contract was held binding on the theory that the employee could if he chose fix a reasonable time for such employment to continue, within which time he could not be discharged.
6 Louisville, etc., Ry. v. Offutt, 99 Ky. 427, 59 Am. St. Rep. 467, 3G S. W. 181. Accordingly he may be discharged at any time. "There was no contract that he would serve and that the appellant would employ him for any stated time - the agreement of both being necessary to fix the time of service - and consequently no violation of a contract by the discharge of the appellee before the expiration of any particular time." St. Louis, etc., Ry. v. Matthews, 64 Ark. 398, 39 L. R. A. 467, 42 S. W. 902 [citing, Harper v. Hassard, 113 Mass. 1S7; Bolles v. Sachs, 37 Minn. 315, 33 N. W. 862; Coffin v. Landis, 46 Pa. St. 426; East Line, etc., Ry. v. Scott, 72 Tex. 70, 10 S. W. 99], In similar contracts the courts by construction of the contract have found obligations assumed by the employee, and hence have enforced the promise.
7Vogel v. Pekoc, 157 111. 339, 30 L. R. A. 491, 42 N. E. 386; Vogel v. Conrad, 157 111. 368, 42 N. E. 389.
8 Nagengast v. Alz, 93 Md. 522, 49 Atl. 333; Rose v. Bank, 165 Mass. 273, 43 N. E. 93.
9 Krause v. Kraus, 162 111. 328, 44 N. E. 736.
10Eustice v. Meytrott, 100 Ark. 510, 140 S. W. 590; Bagnell Timber Co. v. Spann, 102 Ark. 621, 145 S. W. 546.
11 Newberry v. Webb, 68 W. Va. 209, 69 S. E. 792.
12Cooley v. Moss, 123 Ga. 707, 51 S. E. 625.
13 Jordan v. Water Co. (Ind. App.), 61 N. E. 12.
14Mallett v. Watkins, 132 Ga. 700, 64 S. E. 999.
15 Rankin v. Mitchem, 141 N. Car. 277, 53 S. E. 854.
Since, one consideration may support two or more promises, a covenant which imposes obligations upon one party only may be enforceable if it is part of an entire contract which is supported by sufficient consideration.24 If some other consideration is furnished by the employe, a contract for permanent employment may be valid, though such employe does not agree to remain in such employment for any specified time. Thus if the employe releases a claim for damages,25 or agrees to and does abandon other employis Consolidated Portrait & Frame Co. v. Barnett, 158 Ala. 655, 51 So. 936.
"Swindell v. First Nat'l Bank, 121 Ga. 714, 49 S. E. 673; Murphy v. Han-na, 37 N. D. 156, L. R. A. 1918B, 135, 164 N. W. 32.
18Goff v. Saxon, 174 Ky. 330, 192 S. W. 24.
19Kernan v. Carter (Ky.), 104 S. W. 308.
20Levin v. Dietz, 194 N. Y. 376, 20 L. R. A. (N.S.) 251, 87 N. E. 454.
21 Metropolitan Life Insurance Co. v. Felix, 73 0. S. 46, 75 N. E. 941.
22 Kaplan v. Whitworth, 116 La. 337, 40 So. 723.
23 Steinwender-Stoffregen Coffee Co. V. F. T. Guenther Grocery Co. (Ky.), 80 S. W. 1170, 26 Ky. Law Rep. 270.
24 See Sec. 525.
25 Yellow Poplar Lumber Co. v. Rule, 106 Ky. 455, 50 S. W. 685; Louisville & N. R. Co. v. Cox, 145 Ky. 667, 141 S. W. 389; Sax v. Ry., 125 Mich. 252, 84 Am. St. Rep. 572, 84 N. W. 314; Smith v. Ry., 60 Minn. 330, 62 N. W. 392.
ment to enter upon the one in question,26 a consideration for the employer's promise exists. A promise by A to sell B's produce -exclusively, is supported by B's guaranty of A's debt to X.27