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.
It will be noticed that the same state often appears as enforcing two or more theories. There are two reasons for this: first, certain facts in one case may require the court to invoke a theory which is not an extreme one, such as the first or second of those given, while in a subsequent case presenting different facts the court may be willing to take a more extreme theory such as the third or fourth. Second, the courts of one state may at different times have held two or more of these theories, as has been already suggested. For example, the history of the various changes which this doctrine has undergone in New York, is well set forth in a New York case.1 The original test was whether the primary debt continued to exist concurrently with the new promise. If it did, the statute of frauds was held to apply; otherwise not. As the courts departed from this case, the first position taken was, that an original promise was one founded on a new or further consideration of benefit or harm moving between the promisor and promisee.2 It was soon evident that since every contract had to have some consideration, the "terms of the defi-
2 Gale v. Harp, 64 Ark. 426; 43 S. W. 144.
3 West v. Grainger, - Fla. -; 35 So. 91.
1 White v. Rintoul, 108 N. Y. 222; 15 N. E. 318.
2 Leonard v. Vredenburgh, 8 John.
(N. Y.) 29; 5 Am. Dec. 317.
(There must be "some new and original consideration of benefit or harm moving between the newly contracting parties." 5 Am. Dec. 317, 320.) nition," already given, "were dangerously broad and capable of a grave misapprehension, making it almost possible to say that a promise good at Common Law between the new parties was good also in spite of the statute."3 The second position taken, was that the consideration must move to the promisor, and be beneficial to him.4 The third position taken, was that the test of the application of the statute of frauds was "whether the party sought to be charged is the principal debtor, primarily liable, or whether he is only liable in the case of the default of a third person; in other words, whether he is the debtor, or whether his relation to the creditor is that of surety for the performance by some other person of the obligation of the latter to the creditor."5 In view of the confusion of authorities and the abstract form of the proposition's discussion, it is better to consider certain of the more common forms of contracts concerning which questions of the applicability of this clause of the statute have been raised, and discuss them with reference to the words of the statute without invoking the distinction between "original" and "collateral" liability.