Since the obligation under discussion is essentially an obligation to restore a benefit received and not to compensate for an injury inflicted, the value of the benefit to the defendant, and not the cost of the plaintiff's performance or the extent of the plaintiff's loss or damage as a result of the defendant's default, is the measure of the plaintiff's recovery:
Dowling v. McKenney, 1878, 124 Mass. 478: Count for ten days' labor on a monument and three days' services in preparing land and foundation for same. The labor and services were performed under an oral contract by which the defendant was to convey to the plaintiff a lot of land, and to take in payment a monument, when completed, and the balance in money. The plaintiff completed the monument, but the defendant repudiated the contract and refused to take the monument. Endicott, J. (p. 481): "In the case at bar, the defendant received no benefit from the labor performed in completing the monument, although the plaintiff may have suffered a loss because he is unable to enforce his contract, and no recovery can be had for the labor on the monument, as charged in the account annexed to the third count.
"But this rule does not apply to the item for services performed by the plaintiff in preparing the land and foundation. If this refers to the lot of the defendant where the monument was to stand, and the work was done upon it, we cannot say as a matter of law that it was not of benefit to defendant." l
It follows that if the defendant has derived no benefit whatever from the plaintiff's performance the plaintiff has no cause of action. Thus, where a son worked for his father on the father's. farm under an unenforceable contract with his uncle, it was held that the uncle was under no quasi contractual obligation to pay the value of such services, since he had derived no benefit from them.1 For the same reason one who, in reliance upon an unenforceable contract, constructed a wood-chopping machine which was not accepted, was denied a recovery for the value of the labor and materials employed.2
919; Flowers v. Poorman, 1909, 43 Ind. App. 528; 87 N. E. 1107; In re Williams' Estate, 1895, 106 Mich. 490; 64 N. W. 490; Estate of Kessler, 1894, 87 Wis. 660; 59 N. W. 129; 41 Am. St. Rep. 74; Taylor v. Thieman, 1907, 132 Wis. 38; 111 N. W. 229; 122 Am. St. Rep. 943. 1 Also: Fuller v. Reed, 1869, 38 Cal. 99; Ruff v. Riibe, 1903, 68 Neb. 543; 94 N. W. 517; Galvin v. Prentice, 1871, 45 N. Y. 162; 6 Am. Rep. 58; Hertzog. v. Hertzog's Admr. 1859, 34 Pa. St. 418; Masson v. Swan, 1871, 6 Heisk. (53 Tenn.) 450; Pierce v. Paine, 1855, 28 Vt. 34.
It follows, likewise, that in the case of services rendered or property transferred the amount of recovery is not governed by the contract price.3 There are authorities to the contrary,4 but they rest, apparently, upon the theory that in so far as a contract within the statute has been performed by one party before its repudiation by the other, it may be enforced according to its terms. The obligation, in such cases, can hardly be said to be quasi contractual.
Where the value of the plaintiff's performance exceeds the contract price, he may realize, it is true, returns larger than he contemplated when entering into the contract. If it is the defendant who has refused to perform the contract, no injustice results. The defendant suffers no loss, and moreover, if the plaintiff's recovery were limited to the contract rate the defendant might actually profit by the contract which he refuses to perform. If, on the other hand, it is the plaintiff who is in default, the contract price should ordinarily be the limit of his recovery - assuming, of course, that he should be allowed to recover at all. Otherwise he might profit by his default.1 Even in the case of a plaintiff in default, however, if before defaulting he endeavors to have the oral contract reduced to writing and the defendant refuses so to do, the recovery of the full value of his performance, even if it exceeds the contract price, would seem to be unobjectionable. For while technically it is the plaintiff who defaults, the blame attaches exclusively to the defendant.
1 Bristol v. Sutton, 1897, 115 Mich. 365: 73 N. W. 424.
2 Banker v. Henderson, 1895, 58 N. J. L. 26; 32 Atl. 700. See also Cocheco Aqueduct v. Boston, etc., R. Co., 1879, 59 N. H. 312.
3 William, etc., Works v. Atkinson, 1873, 68 111. 421; 18 Am. Rep. 560; Schanzenbach v. Brough, 1895, 58 111. App. 526; Stout's Admr. v. Royston, 1908, 32 Ky. Law Rep. 1055; 107 S. W. 784; Emery v. Smith, 1865, 46 N. H. 151; Hertzog v. Hertzog's Admr. 1859, 34 Pa. St. 418. See Fuller v. Reed, 1869, 38 Cal. 99; Erben v. Lorillard, 1859, 19 N. Y. 299.
4 Murphy v. De Haan, 1902, 116 la. 61; 89 N. W. 100; Sears v. Ohlen, 1911,144 Ky. 473 ; 139 S. W. 759 ; Fuller v. Rice, 1884, 52 Mich. 435 ; 18 N. W. 204 ; Spinney v. Hill, 1900,81 Minn. 316; 84 N. W. 116; Lally v. Crookston Lumber Co., 1902, 85 Minn. 257; 88 N. W. 846. And see Darknell v. Coeur D'Alene, etc., Trans. Co., 1910, 18 Ida. 61; 108 Pac. 536. In Spinney v. Hill, supra, the court said (p. 322): "We are compelled to admit that the reasoning on which the doctrine is based is not satisfactory, and has often been criticized as illogical, because, although the statute denounces such agreements and deprives them of all legal validity, the doctrine itself validates them to some extent, and measures some of the rights of the parties by them."
While the unenforceable contract does not afford the true criterion for determining the value of services rendered or property transferred, it ordinarily does show the amount of money the plaintiff once declared himself willing to take and which the defendant once agreed to pay. It should therefore be admitted, at the instance of either party, in the character not of a contract but of an admission against interest, for the purpose of establishing the value of such services or property. It has been contended in some cases that to permit the introduction of the terms of the contract for the purpose of assisting the plaintiff in any way is to defeat or circumvent the statute.2 This attitude, if consistently assumed, would prevent the proof of the contract even for the purpose of showing that the services rendered by the plaintiff were not intended to be gratuitous. It is clearly untenable. Reasonably interpreted, the statute applies only to the enforcement of oral contracts. It does not relate to oral admissions against interest. If, then, the same transaction happens to amount to both an oral contract and an oral admission, the unenforceability or invalidity of the contract should not affect the competency of the admission as evidence of a non-contractual obligation.1