This section is from the book "A Treatise On The Construction Of The Statute Of Frauds", by Causten Browne. Also available from Amazon: A treatise on the construction of the Statute of frauds.
1 This doctrine will be found separately discussed hereafter, §§ 207, et seq.
2 Farley v. Cleveland, 4 Cowen 432, afterwards affirmed by the Court for the Correction of Errors, but the report, 9 Cowen 639, does not state the grounds of the affirmance. See this case explained in Prime v. Koehler, New York Court of Appeals, 8 Reporter 244.
3 Ellwood v. Monk, 5 Wend. 235. But see Furbish v. Goodnow, 98 Mass. 297, discussed post, § 214 c.
§ 170. Other decisions in New York, which at first sight appear to conflict with these views, are entirely reconcilable with them, when carefully applied. Thus, in Jackson v. Rayner,3 the defendant told the plaintiff that he had taken an assignment of a third party's property and meant to pay his debts, and would pay the debt owing by him to the plaintiff. The defendant had not contracted a debt by becoming such assignee, the only promise shown being an express one to the plaintiff to pay the debt of a third person. And the court held it to be within the statute, the obligation of the third person not appearing to have been extinguished thereby.
1 Skelton v. Brewster, 8 Johns. 376.
2 Westfall v. Parsons, 16 Barb. 645.
3 Jackson v. Rayner, 12 Johns. 291. See this case, post, § 187, note. See also Simpson v. Patten, 4 Johns. 422.
§ 171. The doctrine stated in Barkers. Bucklin is directly sustained, and the proper application of the rule, saving from the statute those promises which are founded upon an independent consideration, may perhaps be also discovered in the earlier case of Gold v. Phillips, in the same State. There the defendants, in part consideration of the sale of a farm to them by one Wood, gave their bond binding themselves to pay certain debts and judgments against Wood, and also a debt due from Wood to the plaintiffs, and wrote to the plaintiffs that, by arrangement with Wood, they were to be accountable for the debt due to them. The court said, "The promise of the defendants was not within the Statute of Frauds. It had no immediate connection with the original contract, but was founded on a new and distinct consideration. The distinction noticed in Leonard v. Vredenburgh 1 applies to this case, and takes it out of the statute. The defendants made the promise in consideration of a sale of lands made to them by Aaron Wood; and they assumed to pay the debt of the plaintiffs, as being, by arrangement with Wood, part-payment of the purchase-money. Here was a valid assumption of the debt of Aaron Wood." 2 The decision was undoubtedly correct; though not simply because the defendant's promise was founded upon a new and distinct consideration. When the reception of the consideration from the third person is in such manner as to create an absolute debt to him from the defendant, the promise of the latter to pay the original debt to the same amount imposes upon him a new liability, but it is not under a special promise, and there is no new liability entered into in the way of a mere guaranty.
1 Leonard v. Vredenburgh. 8 Johns. (N. Y.) 29. This appears to have been the first American case in which the doctrine was announced that a new consideration moving between the parties to the guaranty takes it out of the statute.
2 Gold v. Phillips, 10 Johns. 414; affirmed in Mallory v. Gillett, 21 N. Y. 416. But see Furbish v. Goodnow, 98 Mass. 297, discussed post, § 214 c. See Winn v. Hillyer, 43 Mo. App. 139.
§ 172. Under this same general head it would seem proper to place the numerous cases which hold that a verbal acceptance of, or a verbal promise to accept, a bill of exchange, is not within the statute, where the promisor holds funds of the drawer to meet it. Here no new obligation is imposed upon the promisor. He owes the drawer the amount of the funds in his hands, and by agreement with him, recognized by the payee, he pays the drawer by paying his creditor.1
§ 172 a. In the case of Townsley v. Sumrall,2 the Supreme Court of the United States held that where the defendant, in consideration that the plaintiff would purchase a bill already drawn or to be thereafter drawn, and as an inducement to the purchase, verbally promised to accept the bill, and a bill was drawn and purchased upon the credit of such promise for a sufficient consideration, such verbal promise to accept was binding upon the defendant. The opinion says: "It is an original promise to the purchaser, not merely a promise for the debt of another; and having a sufficient consideration to support it, in reason and justice as well as in law, it ought to bind him. It is of no consequence that the direct consideration moves to a third person, as in this case to the drawer of the bill; for it moves from the purchaser and is his inducement for taking the bill. He pays his money upon the faith of it, and is entitled to claim the fulfilment of it. It is not a case falling within the objects or the mischiefs of the Statute of Frauds. If A. says to B., pay so much money to C. and I will repay it to you, it is an original independent promise; and if the money is paid upon the faith of it, it has been always deemed an obligatory contract even though it be by parol; because there is an original consideration moving between the immediate parties to the contract. Damage to the promisee constitutes as good a consideration as benefit to the promisor. In cases not absolutely closed by authority, this court has already expressed a strong inclination not to extend the operation of the Statute of Frauds so as to embrace original and distinct promises made by different persons at the same time upon the same general consideration. D'Wolf v. Rabaud, 1 Peters, 476."1
1 Pillans v. Van Mierop, 3 Burr. 1663; Grant v. Shaw, 16 Mass. 341; Shields v. Middleton, 2 Cranch (C. C.) 205; Pike v. Irwin, 1 Sand. (N. Y.) 14; Strohecker v. Cohen, 1 Speers (S. C.) Law 349; Leonard v. Mason, 1 Wend. (N. Y.) 522; Raborg v. Peyton, 2 Wheat. (U. S.) 385; Townsley v. Sumrall, 2 Peters (U. S.) 170; Nelson v. First Nat Bank of Chicago, 48 111. 36; O'Donnell v. Smith, 2 E. D. Smith (N. Y.) 124; Spalding v. Andrews, 48 Pa. St. 411; Laflin & Band Powder Co. v. Sinsheimer, 48 Md. 411; Walton v. Mandeville, 56 Iowa 597; Louisville R. R. v. Caldwell, 98 Ind. 245; Espalla v. Wilson, 86 Ala. 487; Neumann v. Shroeder, 71 Texas 81; Kohn v. First National Bank, 15 Kansas * 428; In re Goddard's Estate, 29 Atl. Rep. (Vt.) 634.