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.
Among examples of contracts which may give incidental benefit to a third person, but which are not intended by the parties to benefit him primarily, are the following: a contract whereby the prospective vendee of a mine seeks to have liens held by third persons cleared off before he takes title;1 a promise by one to whom an administrator pays a fund, believing him to be a distributee, to repay a proportionate part of any lawful claim against the estate;2 and a contract whereby the lessee of a railway agrees to pay all taxes and assessments.3 A contract between the United States and a state, for the maintenance of a canal, can not be enforced by one who has made use of water furnished from such canal.4 A covenant by vendee with his vendor to repair a ditch which has become a substitute for a natural watercourse, can not be enforced by a third person who is incidentally benefited thereby.5 If a contractor, under a street improvement contract, gives a bond for the benefit of the laborers and materialmen, an abutting property owner can not enforce such bond, although the performance of the contract for the construction of the street would benefit such property owner.6 If levee commissioners make a contract with a railway for raising a certain levee, a property owner who will be benefited by such improvement can not: maintain an action upon such contract,7 at least unless it is shown that his land would have been assessed for such improvement.8 A contract between an employer and an employe, whereby the employer agrees to furnish his employe a physician if the employe is injured in the course of his employment, can not be enforced by a phvsician whom the employe engages.9 A contract between a contractor and an improvement district, which contains a provision for liquidated damages, is not intended for the benefit of engineers whose compensation is agreed upon in the contract between such engineers and the improvement district.10
5 King v. Scott, 76 W. Va. 58, 84 S. E. 954.
6 Casselman's Administratrix v. Gordon, 118 Va. 533. 88 S. E. 58.
7 King v. Scott. 76 W. Va. 58. 84 S. E. 954.
8 Mcllvane v. Big Stony Lumber Co., 105 Va. 613. 54 S. E. 473.
9 Casselman's Administratrix v. Gordon. 118 Va. 553. 88 S. E. 58.
1 McDonald v. Bank. 25 Mont. 456. 65 Pac. 896. (The lien holder can not enforce such contract.)
2 Norwood v. O'Neal, 112 N. Car. 127, 16 S. E. 759. (The true distributee cannot enforce such promise.)
3 Chicago, etc.. Ry. v. Ottumwa, 112 Ia. 300, 51 L. R. A.763. 83 N. W. 1074. (Neither the city nor the contractor for whose benefit the assessment is levied can sue the lessee.)
4Vought v. R. R., 58 0. S. 123, 50 N. E. 442 [affirmed in Walsh v. R. R., 176 U. S. 469, 44 L. ed. 548],
Whether a contract between an employer and a labor union is intended for the benefit of the individual employe of such employer, is a question upon which there is a conflict of authority. On the one hand, a contract with a labor union, which provides for appeal in case of discharge, and for payment for time lost in case of reinstatement upon such appeal, is assumed not to be intended for the benefit of the individual employe;11 and accordingly an individual employe can not bring an action because of refusal to grant him an appeal in case of an unjust discharge:12 On the other hand it has been held that a contract between an employer and a labor union, by which the rate of wages for employes is fixed, is intended to be for the benefit of the individual employes;13 and an employe who works for a less compensation under a special contract with his employer, in ignorance of the contract between the employer and the labor union, may recover the difference between the amount which he received and the amount which the employer had agreed to pay under such contract.14
5 Case v. Hoffman, 100 Wis. 314, 44 L. R. A. 728, 75 N. W. 945.
6 St. Louis v. Wright Contracting Co., 202 Mo. 451, lift Am. St. Rep. 810, 101 S. W. 6.
7 Rodhouse v. Chicago & A. Ry. Co., 219 111, 596. 76 N. E. 836.
8 Rodhouse v. Chicago & A. Ry. Co., 219 111. 596, 76 N. E. 836.
9 Thomas Mfg. Co. v. Prather, 65 Ark. 27, 44 S. W. 218.
10 Dickinson v. McCoppin. 121 Ark. 414, 181 S. W. 151.
11 Hudson v. Cincinnati, N. O. A T.
P. R. Co., 152 Ky. 711, 45 L. R. A. (N.S.) 184, 154 S. W. 47.
12 Hudson v. Cincinnati, N. O. & T. P. R. Co., 152 Ky. 711, 45 L. R. A. (N.S.) 184, 154 S. W. 47.
"In Burnetta v. Marceline Coal Co., 180 Mo. 241, 79 S. W. 136, Burnetta, a miner and member of the Miners' Union, entered into the service of the coal company, and, after continuing therein for a short time, voluntarily left the company and sued it for the balance of wages due him. The company admitted the amount charged to be owing him, but denied that it was then due. The workman asserted that the union of which he was a member had a contract with the company in which certain pay days wore provided for, and that under this contract the amount owing was due. The court there, in disposing of the question as to whether a contract made by a union in respect to rates and regulations enured to the benefit of its members said: 'The Miners' Union is not an organization for the purpose of conducting any business enterprise, but is purely one for the protection of labor against the unjust exactions of capital. The members of the union do not labor in coal mines for the organization, but each member works for himself, and whatever compensation he receives is for the benefit of himself and his family. That the Miners' Union, as an organization, can not make a contract for its individual members in respect to the performance of work and the payment for it, in our opinion is too clear for discussion. *** While it may be true that a labor organization may have rules requiring the employer to designate a certain pay day, and if you employ a member of the organization, or even one who is not a member, and by agreement his services are to be paid on the designated pay days, as established by the rules, it could well be insisted that the contract fixes the time of payment, that is, upon the theory that the individual so contracts, and by no means upon account of his being a member of the organization which has undertaken to contract for him. * * * A contract on the part of an individual that he will perform certain work under the rules of an organization is not to be inferred from the simple fact that he is a member of the organization. Persons work for themselves, and are free and independent. Agreements imposing conditions can only be enforced when the entire proposition has been stated and by them freely accepted."' Hudson v. Cincinnati, N. O. & T. P. Ry. Co., 158 Ky. 711, 45 L. R. A. (N.S.) 134, 154 S. W. 47. (In this case, however, it was said that the agreement between the employer and the labor union lacked consideration and was accordingly not a binding contract.)