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 Ante, §§ 165-172, and cases there cited. Also M'Laren v. Hutchinson, 22 Cal. 187; Conner v. Williams, 2 Rob. (N. Y.) 46; Clymer v. De Young, 54 Pa. St. 118; Ford v. Finney, 35 Ga. 258; Sanders v. Clason, 13 Minn. 379; Hoile v. Bailey, 58 Wisc. 434; Martin v. Davis, 80 Wisc. 379; Lowe v. Hamilton, 132 Ind. 406.
2 Ante, §§ 166,170, § 216, n. 1. Richardson v. Robbins, 129 Mass. 107.
3 Curtis v. Brown, 5 Cushing, 488.
1 Furbish v. Goodnow, 98 Mass. 297.
§ 214 d. In the case of Curtis v. Brown,2 one Coffin was under contract with the defendants to build for them certain houses, under which the work proceeded for about three months, when Coffin released the defendants from the contract, and assigned to them the materials on hand, in consideration of which the defendants agreed to pay all the bills for labor and materials then outstanding, and among them the bill for which the plaintiff sued. The court held that he could not recover, the promise of the defendants not being in writing; remarking, among other things, that "the plaintiff did not release Coffin, or relinquish any lien or benefit; and although there was a good consideration in law for the defendant's promise, it was a consideration moving from Coffin, and not from the plaintiff." The question was not raised whether the transaction was such as to create against the defendants an independent obligation to pay Coffin money to the same amount as the debts which they undertook to pay; and it would seem from the report of the facts that it was not. The case was put upon the question of the nature of the consideration and the party from whom it moved. If it does necessarily depend upon that question, it cannot be denied that it supports the decision in Furbish v. Goodnow; and is subject also to the same difficulties.1
1 Compare Urquhart v. Brayton, 6 Reporter 601; and see ante, §§ 166 6, 160, 171; Wright v. Smith, 81 Va. 777.
2 Curtis v. Brown, 5 Cush. (Mass.) 488.
§ 214 e. We have spoken thus far of the first class of cases to which the rule stated in § 214 a applied; namely, where the defendant owes a third party and the third party owes the plaintiff, and, by agreement between the three parties, the defendant is to pay the amount of his debt directly to the plaintiff. The next class of cases to which the rule applies is where the defendant contracts a debt directly with the plaintiff, which he agrees to pay by paying a third party's debt to the plaintiff. In most cases under the statute, this debt arises from the plaintiff giving up directly or indirectly to the defendant some lien or security or other advantage for securing or recovering the debt owing to the plaintiff by the third party.1 Those cases in which the giving up of such lien or security or advantage by the plaintiff, though not to the defendant directly or indirectly, has been held sufficient to take the defendant's promise out of the statute, are opposed to the clear current of later and better considered cases, and must be rejected as not law. Where the lien or security or other advantage is given up directly or indirectly to the defendant, it is really a purchase of it by him. But it is not true as a general proposition that every transfer of value from the plaintiff to the defendant prevents the statute from applying to the defendant's promise, in consideration of such transfer of value, to pay to the plaintiff the amount owing to him by a third party. The mere passing of a new and independent consideration between the plaintiff and the defendant does not take the case out of the operation of the statute; and so far as some of the decisions depend upon the contrary, they cannot be regarded as law.2 Every contract of guaranty requires a consideration moving from the party to whom the guaranty is given; there can be no sensible distinction made between "new and independent" considerations and any other considerations; and the general proposition that "a new and independent consideration moving between the parties to the contract of guaranty" takes it out of the statute, simply nullifies the statute. The distinction is between a merely valid consideration for the defendant's promise of guaranty, and that transfer of value which creates an original obligation on the part of the defendant, the measure of which is, by the agreement of the parties, the defendant's payment of the third party's debt. To a third class belong the cases in which the property of the third party is put into the hands of the defendant for the purpose of paying, out of the proceeds thereof, the third party's debt to the plaintiff. These are cases of obligation by the defendant as a trustee to make such payment, and it is that personal obligation which the plaintiff seeks to enforce, and his right of action is not affected by the statute.1
1 In the case of Pike v. Brown, 7 Cush. (Mass.) 136, the grantee in a deed of land which was subject to a mortgage verbally agreed to pay the interest on the mortgage debt as it became due. He failed to do so, and the grantor, having paid it himself, was held entitled to recover the amount from the grantee in assumpsit. The court said: "The substance of the contract with the plaintiff was on a consideration moving from him, to pay his debt, for his benefit, and to exonerate him, and was no less a direct promise to the plaintiff, because, in the performance of it, it would satisfy a debt due to another." See this case cited with approval in Clapp v. Lawton, 31 Conn. 95. But according to Furbish v. Goodnow, if the grantee's promise had been communicated to the mortgage creditor, and he had sued the grantee for the amount of the interest, he could not have recovered. Again it is settled in Massachusetts that a verbal promise to accept a bill of exchange is binding (Grant v. Shaw, 16 Mass. 311). But this is a promise to pay the debt of a third party to the drawer of the draft, and is only valid without writing because the defendant, being indebted to the third party, agrees to pay his own debt by paying that third party's debt to the plaintiff. See ante, § 172.