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 distinction is very clear, where mutual covenants go to the whole of the consideration on both sides, they are mutual conditions, the one precedent to the other. But where they go only to a part, where a breach may be paid for in damages, there the defendant has a remedy on his covenant, and shall not plead it as a condition precedent. If this plea were to be allowed, any one negro not being the property of the plaintiff would bar the action." Boone v. Eyre, 1 H. Bl. 273, note.
2 See Sec. 2981.
3 See Sec. 2021 et seq.
4 Graves v. Legg, 9 Exch. 709; Rosenthal Paper Co. v. National Folding Box & Paper Co., 226 N. Y. 313, 123 N. E. 766.
5 Hart v. Tremont Lumber Co., 131 La. 847. 60 So. 368.
6 Boone v. Eyre, 1 H. Bl. 273, note.
(4) were held to be independent.7 A city agreed (1) to convey certain land to A, (2) to pay a sura of money to A, (3) to exempt such property from taxation, and (4) to construct a sewer, in consideration of which A agreed to operate a factory on such land for a period of ten years, and to secure performance of such covenant by mortgage. It was held that if the city had performed its first three covenants, the fourth covenant was independent and that a breach thereof did not discharge A's covenant.8 Under a contract by which A agreed to convey certain realty to B and to furnish water therefor, and B agreed to pay taxes and interest and to make improvements, it is held that A's covenant to furnish water is independent and that his failure to perform such covenant does not excuse B for his failure to make such payments.9 Under a contract by which A agrees to sell certain land to B and to furnish water at a certain price per annum, and B agrees to pay a certain amount for such land and to pay for such water, A's covenant to furnish water is independent, so that if B fails to pay for such land A may avoid the contract without showing that he has performed his covenant to furnish water.10 Under a contract by which A agrees to convey land to B and to lay water mains,11 or A agrees to convey land to B and to lay sidewalks and put in water mains and sewers,12 or A conveys land and agrees to raise the level of an irrigation ditch,13 the covenants other than that for the conveyance of the realty are generally held to become independent covenants after A has performed, and B can not avoid such contract because of A's failure to perform such other covenants. If A agrees to exchange land with B, and B agrees to construct a building on the land which he is to convey to A, B's covenant to construct such building is independent.14 Under a contract by which A agreed to convey certain property to B and to give up all claims against the estate of X, in consideration of which B agreed that A should have a certain interest in X's estate and that B would give up his interest in certain personalty to A, it was held that after A had performed by conveying such realty his covenant not to press claims against X's estate was an independent covenant the breach of which would not enable B to avoid the entire contract.15 A leased to B, in consideration of which B was (1) to erect a building which cost twenty thousand dollars, (2) pay rents which aggregated a hundred thousand dollars, (3) perform certain other covenants. The group of covenants numbered (3) were independent, and by reason of B's breach thereof A could not treat a covenant whereby he agreed to pay five thousand dollars for the building at the end of the term as discharged.16 A had leased a building to B. B wished to assign to X, who was organizing a corporation. A and X agreed that A should release B from liability for rent; X would pay the rent at the end of the year; A would waive his right to eject for nonpayment of rent; and X would assign to A a certain amount of stock in the new corporation which at a certain time A would reassign to X. The covenant to reassign is an independent covenant and a breach thereof does not discharge the contract.17 Under a contract by which A agrees to lease certain property to B and to grant a renewal thereof, and B agrees to pay rent therefor, the covenants are so far independent that B's default in paying rent does not discharge the covenant to renew.18 Under a contract by which A agrees to sell goods to B as B may order them, and B agrees to pay a certain amount to compensate A in case B fails to order a certain quantity of goods within a certain time, B's covenant to pay such compensation for his failure to send in such orders is independent, and a breach thereof does not discharge A from his contract to fill B's orders.19 Under a contract by which A agrees to buy articles to be used as premiums in a voting contest, and gives notes in payment therefor, and B agrees to furnish such articles and guarantees a certain increase in A's business as a result of such voting contest, A's notes are independent covenants and his failure to pay them does not discharge B from liability upon such contract of guaranty.20 If A agrees to sell certain goods to B and not to sell such goods to any one else in town, and B agrees to pay therefor, A's covenant not to sell to any one else is independent, and a breach thereof does not discharge B from his liability to pay for Such goods.21 If A and B agree to exchange property, and A pays earnest money to bind the bargain, A's covenant to convey becomes independent and A may maintain an action against B without offering to perform on his part.22 Under a contract by which A guarantees X's debts to B in consideration of B's giving an extension of time on X's prior indebtedness, and also in consideration of B's agreeing to grant credit to X when X requests it, the latter covenant is independent and a breach thereof does not discharge A from his liability on such guarantee.23 Under a contract of indemnity insurance by which the premium is due in advance, the failure of the insurance company to reimburse the insured for certain surgical expenses is a breach of an independent covenant and does not discharge the insured from his duty to pay such premium.24 Under an ante-nuptial contract by which the wife agrees to accept a certain amount of money in lieu of her interest in her husband's estate, his covenant to pay such money is an independent covenant after the parties have intermarried; and his failure to make such payment does not operate as a discharge of the contract.25 Under a contract by which A agreed to sing in opera and in concerts during a period of four months, and A agreed to report for rehearsal six days before the engagement began, in consideration of which B agreed to pay a certain sum, the covenant to appear at such time for rehearsal was independent, so that a breach thereof did not operate as a discharge of the entire contract.26 A hired B to work for him in consideration of a carriage which A delivered to B and a certain sum per month. The covenant to pay wages was an independent covenant, breach of which did not discharge the contract as to B.27 A agreed to deliver a certain number of logs to B to be sawed and to pay a certain price therefor. B agreed to saw them at that price and to saw for no other person during that season. B's sawing for others is a breach of an independent covenant, and if he saws all the logs furnished by A, A is not justified in treating the entire contract as ended and refusing to deliver more logs.28 Under a contract by a lighting company to furnish electricity to the city and to reduce its commercial rate, the latter covenant was held to be independent, so that a breach thereof did not operate as a discharge of the entire contract.29 Under a contract by which A sold his business to B and agreed to refrain from trading with former customers, in consideration of which B agreed to pay to A a certain amount per annum for his life, it was held that A's covenant to refrain from trading with such customers was independent, since A's covenant was negative and could not be performed in full until his death.30 A different rule has been applied where full compensation has been made for performance by the adversary party. In cases of this sort the party in default, having received full compensation, can not contend that the covenant in question is a part of the entire consideration, so that the party who is bound to perform such covenant will be unjustly enriched if the entire contract is to be treated as discharged.31 If A has agreed to employ B for a certain period of time at a fixed salary, and B agrees to perform certain duties, and not to engage in such business within a certain period after his employment ends, and B performs the services for which he is paid under the contract, A's act in terminating such contract before the time fixed by such contract operates to discharge B from his covenant not to compete with A.32