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 term "precedent covenant" implies, as a correlative, a "subsequent covenant/' A "precedent covenant" is one which, by the terms of the contract, is to be performed before the corresponding covenant on the part of the adversary party is to be performed by such adversary party.1 A corresponding covenant, which by the terms of the contract is not to be performed until the adversary party has performed the precedent covenant, is the "subsequent covenant."
2 Russ Lumber Co. v. Muscupiabe Land Co., 120 Cal. 521, 65 Am. St. Rep. 186, 52 Pac. 095; Gillum v. Den-nis, 4 Ind. 417.
3 Tronson v. Colby University, 9 N. D. 559, 84 N. W. 474.
4 California. Hill v. Grigsby, 35 Cal. 656; McCroskey v. Ladd, 96 Cal. 455, 31 Pac 558.
Illinois. Runkle v. Johnson, 30 Ill. 328, 83 Am. Dec. 191.
Indiana. Irwin v. Lee, 34 Ind. 319.
Kansas. Soper v. Gabe, 55 Kan. 646, 41 Pac. 969.
New York. Beecher v. Conradt, 13 N. Y. 108; Eddy v. Davis, 116 N. Y. 247, 22 N. E. 362.
South Dakota. First National Bank v. Spear, 12 S. D. 108, 80 N. W. 166.
5 Sheeren v. Moses, 84 Ill. 448; Gray v. Meek, 199 Ill. 136, 64 N. E. 1020; Bowen v. Bailey, 42 Miss. 405.
1 England. Graves v. Legg, 9 Exch. 709.
United States. World's Fair Mining Co. v. Powers, 224 U. S. 173, 56 L. ed. 717.
California. McConnell v. Corona City Water Co., 149 Cal. 60, 8 L. R. A. (N.S.) 1171, 85 Pac. 929.
Colorado. Empson Packing Co. v. Clawson, 43 Colo. 188, 95 Pac. 546; Burrell v. Masters, - Colo. -, 176 Pac. 316.
Precedent covenants are usually said to consist of two general classes. One class of precedent covenants consist of the covenant which is precedent to the corresponding subsequent covenant because the time for the performance of each is fixed by the contract, or the order of performance is fixed; and the time for the performance of the precedent covenant must occur before the time for the performance of the subsequent covenant has arrived.2 If two acts are to be done at different times, each of which times is fixed, and there is a necessary priority of one over the other in point of time, performance of the prior covenant is precedent to the right of enforcing the later covenant.3 If A agrees to complete a railroad for B by December 1st, and B is then to give notes payable six months thereafter, A's performance is a condition precedent to B's liability.4 Even if the time for performance is not fixed in the ordinary sense of fixing time, the clear intent of the parties that one covenant shall be performed before performance can be required from the adversary party, makes the former covenant a precedent covenant and the latter a subsequent covenant.5 It has been said that a provision that A should transfer something to B on payment by B of a certain sum of money, makes B's payment precedent to A's duty to make such transfer.6 In many jurisdictions, however, language of this sort would not be sufficient to overcome the general presumption in favor of concurrent covenants.7 Under a provision that A should "first" make payment, and that B should convey certain property, it is held that such covenants are concurrent and that A's covenant to pay is not precedent to B's duty to convey.8
Florida. Southern Colonization Co. v. Derfler, 73 Fla. 924, L. R. A. 1917F, 744, 75 So. 790.
Kentucky. Seventh St. Planing Mill Co. v. Schaefer (Ky.), 99 S. W. 341.
Louisiana. Louisiana & N. W. R. Co. v. Athens Lumber Co., 134 La. 788, L. R. A. 1915B, 856, 64 So. 714.
Maine. Savage Manufacturing Co. v. Armstrong, 19 Me. 147; Hunt v. Tibbetts, 70 Me. 221.
Massachusetts. Parrot v. Mexican Central Ry. Co., 207 Mass. 184, 34 L. R. A. (N.S.) 261, 93 N. E. 590.
Michigan. Gates v. Detroit & Mack-inac Ry. Co., 147 Mich. 523, 111 N. W. 101; J. W. Reedy Elevator Mfg. Co. v. Peck, 149 Mich. 657, 113 N. W. 300.
New Hampshire. Famous Players Film Co. v. Salomon, - N. H. -, 106 Atl. 282.
New York. Meriden Britannia Co. v. Zingsen, 48 N. Y. 247, 8 Am. Rep. 549.
North Carolina. Hughes v. Crocker, 148 N. Car. 318, 125 Am. St. Rep. 606, 62 S. E. 429.
North Dakota. Sunshine Cloak &
Suit Co. v. Roquette, 30 N. D. 143, L. R. A. 1916E, 932, 152 N. W. 359.
South Carolina. Pearson v. Easter-ling, - S. Car. -, 97 S. E. 238.
Tennessee. Gardner v. Deeds, 116 Tenn. 128, 4 L. R. A. (N.S.) 740, 92 S. W. 518.
Utah. William B. Hughes Produce Co. v. Pulley, 47 Utah 544, L. R. A. 1916D, 728, 155 Pac. 337.
Wisconsin. Olson v. Viroqua, 121 Wis. 571, 105 Am. St. Rep. 1039, 99 N. W. 326.
2 Florida. Southern Colonization Co. v. Derfler, 73 Fla. 924, L. R. A. 1917F, 744, 75 So. 790.
Massachusetts. Parrot v. Mexican Central Ry., 207 Mass. 184, 34 L. R. A. (N.S.) 261, 93 N. E. 590.
Michigan. Hill v. Mathews, 78 Mich. 377, 44 N. W. 286.
Oregon. Holts v. Olds, 84 Or. 567, 164 Pac. 583.
Wisconsin. Kellogg v. Nelson, 5 Wis. 125.
3 Slater v. Emerson, 60 U. S. (19 How.) 224, 15 L. ed. 626.
4 Slater v. Emerson, 60 U. S. (19 How.) 224, 15 L. ed. 626.
The second class of precedent covenants consists of covenants for the performance of which no set time is fixed, but which from their nature are such that they must be performed before performance on the part of the adversary party can be required.9
In many cases these two classes of precedent covenants merge into each other, since, although performance of each covenant is not required at a fixed time, the contract may show by its express terms, and not merely by the nature of the respective covenants alone, that performance is to be made on the part of one of the parties before performance can be required on the part of the adversary party.
5 Porter v. Shepard, 6 T. R. 665; Loud v. Pomona Land & Water Co., 153 U. S. 564, 38 L. ed. 822; North-rup v. Northrup, 6 Cow. (N. Y.) 206; Hughes v. Crooker, 148 N. Car. 318, 125 Am. St. Rep. 606, 62 S. E. 429.
6 Loud v. Pomona Land & Water Co., 153 U. S. 564. 38 L. ed. 822; Northrup v. Northrup, 6 Cow. (N. Y.) 206.
7 See Sec. 2052.
8 Ink v. Rohrig, 23 S. D. 548, 122 N. W. 594.
9 United States. King Iron Bridge & Manufacturing Co. v. St. Louis, 43 Fed. 768, 10 L. R. A. 826 [appeal dismissed on motion of plaintiff in error, St. Louis v. King Bridge & Manufacturing Co., 149 U. S. 769, 37 L. ed. 060].
Alabama. Hardaway-Wright Co. v. Bradley Bros., 163 Ala. 596, 51 So. 21.
California. McConnell v. Corona City Water Co., 149 Cal. 60, 8 L. R. A. (N.S.) 1171, 85 Pac. 929.
Colorado. Empson Packing Co. v. Clawson, 43 Colo. 188, 95 Pac. 546.
Illinois. Vermont St. M. E. Church v. Brose, 104 Ill. 206; Oliver v. Satt-ler, 233 Ill. 536, 84 N: E. 652.
Kentucky. Williams v. Yates (Ky.), 113 S. W. 503; Pittsburgh Filter Mfg. Co. v. Smith, 176 Ky. 554, 106 S. W. 150.
Maine. Savage Manufacturing Co. v. Armstrong, 19 Me. 147.
Massachusetts. Mill Dam Foundry v. Hovey, 38 Mass. (21 Pick.) 417.
Michigan. J. W. Reedy Elevator Mfg. Co. v. Peck, 140 Mich. 657, 113 N. W. 300.
Montana. Starr v. Gregory Consolidated Mining Co., 6 Mont. 485, 13 Pac. 105.
New Mexico. Culp v. Sandoval, 22 N. M. 71, L. R. A. 1017A, 1157, 159 Pac. 956.
New York. Atlantic Avenue Ry. v. Johnson, 134 N. Y. 375, 31 N. E. 003; Gutmann v. Crouch, 134 N. Y. 585, 31 N. E. 275.
Oregon. Vanderhof v. Shell, 42 Or. 578, 72 Pac. 126.
Tennessee. Gardner v. Deeds, 116 Tenn. 128, 4 L. R. A. (N.S.) 740, 92 S. W. 518.
Utah. Wm. B. Hughes Produce Co. v. Pulley, 47 Utah 544, L. R. A. 1916D, 728, 155 Pac. 337,
A precedent covenant is frequently referred to as a condition.10 The intention of the parties that performance on the part of one shall be completed before performance can be required on the part of the other is said to show that the precedent covenant may also operate as a precedent condition.11 It is in cases of this sort, in which the parties have indicated their intention that breach by one party shall operate as a discharge of the adversary party, that the confusion between conditions and covenants has arisen;12 but this confusion has unfortunately not been confined to cases of this sort.13
The fact that a covenant is spoken of as a condition is not conclusive of the fact that it is a precedent covenant, if the contract taken as a whole shows that it is not to be performed until after the adversary party has performed one or more of the covenants on his part.14 If bonds of a county are issued to a railway, and if the contract provides that the railway shall use such money in constructing its road, the construction of such road is not precedent to the issuing of such bonds, although in the proposition which is submitted to popular vote the question is whether the bonds in payment of such subscription should be issued on condition that the railway should locate and construct the road in accordance with the terms of its contract.15
Virginia. Welch v. McDonald, 85 Va. 500, 8 S. E. 711; Taylor v. Nether-wood, 91 Va. 88, 20 S. E. 888; Atlantic & Danville Ry. v. Delaware Construction Co., 98 Va. 503, 37 S. E. 13.
Wisconsin. Olson v. Viroqua, 121 Wis. 571, 105 Am. St. Rep. 1039, 09 N. W. 326.
"When in the order of events the act to be done by the one party must necessarily be done before the other can be done, it is necessarily a condition precedent, although there be a stipulation for liquidated damages for the breach on each side, and although there be a fixed future time for payment, sufficiently distant to have the work done in the meantime. Suppose B agrees to build at his own shop a carriage for A, of A's materials; A stipulates seasonably to furnish materials and to pay B in four months, and each, upon failure, stipulates to pay a sum as liquidated damages. The furnishing or tendering the materials by A is a condition precedent. Without it B can not perform. He must build it of A's materials. Even building it of his own would not be a performance. B has his shop, his tools, and his workmen all ready, but A does not furnish the materials. If B sues A, averring readiness to perform, ho may recover. But if A sues B for not building the carriage, it would be a good answer that A himself had not furnished the materials, because, whatever else the contract may contain, this is in its nature a condition precedent." Cadwell v. Blake, 72 Mass. (6 Gray) 402.
10 Clark v. Gulesian, 197 Mass. 492, 84 N. E. 94.
11 See Sec. 2578.
12 See Sec. 2576 et seq. 13 See Sec. 2576 et seq.
14 Quinlan v. Green County, 157 Fed. 33, 19 L. R. A. (N.S.) 840 [affirmed, Green County v. Quinlan, 211 U. S. 582, 53 L. ed. 335].
In the absence of a provision in a contract, tending to show that a given covenant is precedent, the court will not construe the contract so as to make such covenant precedent.16 An express provision in a contract may make a covenant independent, although without such express provision it would ordinarily be regarded as precedent.17 An express provision that failure to pay assessments by a member while he is sick shall not be ground for cancellation of his membership, prevents his failure to pay assessments from operating as a discharge of a contract to furnish medical and hospital services.18
 
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