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 question of the relation of the covenants of a contract to one another was first presented at common law in the case of contracts under seal, and it was held that such covenants were prima facie independent covenants, and that they were to be so construed in the absence of language in the contract which showed clearly that they were intended to be dependent.1 The rule is assumed in the earlier cases as a well-settled rule which needs no argument or discussion.
There are two reasons which possibly may have led the courts to reach this result. The contracts in question were under seal; and if each covenant had appeared in a separate contract, each would have been enforceable without regard to the performance of the covenant contained in the other contract. Accordingly, when the two covenants were in fact contained in the same instrument, it might have been felt that the incorporation of the two covenants on the part of the respective parties to the sealed instrument did not make them any more dependent on each other, in the absence of language showing such intention, than they would have been if they had appeared in separate instruments.
Another reason which may have led the courts to this result was the fact that, when this question was first presented, there were no definite rules on the subject of the measure of damages, and the courts had no check on the action of the jury in rendering a verdict for such amount as it saw fit. The courts at this time had no power to grant a new trial because of the amount of damages which the jury had allowed. The jury were said to be "chancellors" when it came to awarding damages, which meant that the whole matter of damages was in the discretion of the jury and that the court had no check thereon.2 With the law in this condition, the courts could be much surer of doing justice, even in accordance with the modern ideas, by treating the covenants as independent and by allowing each party to recover the value of the performance for which he had contracted, than they could by treating the contracts as dependent, since this would have resulted in many cases in discharging the party who was not in default and in leaving the jury to render such verdict as it might see fit. In many cases the result of allowing .each party to recover on the theory that the covenants were independent would be the adoption of substantially the same measure of damages as that which the courts now use.3 Whatever the reason may have been, the rule that covenants were to be regarded as independent was thoroughly settled at common law with reference to sealed contracts. Under a covenant by which A agreed to furnish a certain number of soldiers at a certain port, and B agreed to furnish food and transportation of such soldiers to another port, it was held that A's failure to furnish such soldiers was not a defense in an action by A against B on such covenant for B's failure to provide transportation and food.4 Under a covenant by which A agreed to take his ship with the first fair wind from a given port to another and return, and B agreed to pay freight and a certain amount per day, it was held that A's failure to perform was no defense to an action by A against B upon B's covenant to make such payments5 If a sealed contract was executed by A and B, by which each agreed to marry the other at a certain time, with a penalty for failure to perform, it was held that either could bring an action upon such bond, without perform ing or apparently without offering to perform.6 In some of the cases in which this rule is laid down, the question is not involved, since there is such tender by one and such refusal by the other as would give right of action, even if the covenants were held to be concurrent.7
8 Loud v. Pomona Land & Water Co., 153 U. 8. 564, 38 L. ed. 822; Bean v. Atwater, 4 Conn. 3, 10 Am. Dec. 91; Kane v. Hood, 30 Mass. (13 Pick.) 281; Glaaer v. Dannelley, 23 N. M. 503, 170 Pac. 63; Dey v. Dox, 9 Wend. (N. Y.) 129, 24 Am. Dec. 137; Adrian v. Lane, 13 S. Car. 183; Kettle v. Harvey, 21 Vt. 301.
1 Y. B. 15 Hen. VII, 10b, pl. 17; Ware v. Chappell, Style 180; Rolles v. Oa-born, 1 Brownl. & Gold. 90; Pordage v. Cole, 1 Wms. Saund. 319, also reported in 1 Lev. 274; Cole v. Shallett, 3 Lev. 41.
2 See ch. LXXXVII
3 Seech LXXXVII
4 Ware v. Chappell, Style 186.
5 Cole v. Shallett, 3 Lev. 41.
* * * the covenants are mutual and reciprocal, whereupon each hath his action against the other, and can not plead the breach of one covenant in bar of the other; and perhaps the damage of the one side and the other was not equal, and therefore the one not pleadable in bar of the other; but each party la by his action to recover against the other the certain damage he sustained, and so it was adjudged. Hill, 13 Car. 2 B. R., inter Thompson & Noel." Cole v. Shallet, 3 Lev. 41. 6 Rolles v. Osborn, 1 Brownl. & Gold.