actual difference of result would be produced, according as one accepts Sir Frederick Pollock's definition, or Mr. Leake's. The most sharply defined difference is in regard to the third party cases, which have been more discussed than any others relating to the law of consideration. Under the definition of Sir Frederick Pollock and Professor Langdell a bilateral agreement between B. and C. by which B. promises to do something which he was previously legally bound to do by contract with A., is a valid contract, since assuming B.'s promise to C. to be binding, it imposes a new、 detriment on B., namely, liability to a new person in case of non-performance of the promised act; though both Sir Frederick Pollock and Professor Langdell contend that had B. performed the act in question at C.'s request instead of promising to perform it, the previous obligation to A. would have prevented the performance from being a detriment in law to B., and no new contract would be formed. Under Mr. Leake's definition, no distinction is possible between cases where the second agreement is bilateral and where it is unilateral. If the performance is sufficient consideration for a contract, the promise of performance is likewise sufficient. If actual performance is sufficient, so is a promise of performance. And the authorites make no distinction.62 Another class of cases which is inconsistent with the theory which I have attributed to Sir Frederick Pollock and Professor Langdell, consists of bilateral agreements, in which one promise is a promise to pay a debt. It is well settled that such agreements are not binding.63 These cases are decided on the ground that the performance of the promise to pay the debt involves no legal detriment to one party or legal benefit to the other; and yet the promise if binding would involve a detriment since it extends the period of the Statute of Limitations. The same argument is applicable to forbearance and promises of forbearance of a groundless suit against a third person, especially in jurisdictions where forbearance to bring a groundless though honest claim against the promisor is held insufficient consideration. There is nothing in the cases relating to this matter to warrant the supposition 62 See infra, § 131. 63 See infra, § 120. that the law is different when the suit to be forborne is against a third person, and the legal duty to forbear is therefore not to the promisee,64 and if a promise of similar forbearance to sue the promisee would be insufficient, the promise to forbear to sue a third person would also be insufficient consideration.65 Yet such a promise if binding would subject the promisor to a new duty. This may be followed with a similar argument regarding forbearance to commit a tort against a third person. It is of course certain that such a promise is not a valid consideration. This must be accounted for under the view now criticised as resting solely on public policy, but it has generally been supposed that such an agreement also lacked consideration.66 A promise to receive a pure benefit also which under the theory in question would be sufficient consideration cannot be so regarded.67 A mutual agreement to rescind a unilateral obligation, which is much the same thing as a promise to give, is, it is well settled, ineffectual.68 Finally, Mr. Leake's test seems the better of the two in question, because, as already said, it seems intrinsically unreasonable that a promise of an act should ever be regarded by the law as greater value than actual performance of that very act. As the matter has been well put,69 the contrary view involves the assertion "that a bird in the hand is worth less than [the same] bird in the bush." 70 § 103e. Promises which are not binding are insufficient consideration. Whatever may be the character of the thing promised, a promise will be of no value unless it is binding; and the rule, 64 See Smith v. Algar, 1 B. & Ad. 603; Mascolo v. Montesanto, 61 Conn. 50, 23 Atl. 714, 29 Am. St. Rep. 170; and infra, § 135. 65 Bates v. Sandy, 27 Ill. App. 552; Herbert v. Mueller, 83 Ill. App. 391; Anderson v. Nystrom, 103 Minn. 168, 114 N. W. 742, 13 L. R. A. (N. S.) 1141, 123 Am. St. Rep. 320. 66 See infra, § 132. Forth v. Stanton, 1 Saund. 210; Wilt v. Hammond, 179 Mo. App. 406, 165 S. W. 362. See also Hoffman v. 69 Professor Ballantine, 11 Mich. L. Rev. 427. 70 See, however, infra, § 123. though general, that mutual promises are binding which promise some act or forbearance, which would itself be sufficient consideration, is not universal. There are other reasons besides lack of consideration which make promises void-notably lack of capacity. The qualification which thus must be made to the definition of consideration in bilateral contracts is as essential to Professor Langdell's definition as to Leake's. Both definitions propose a general test to determine when mutual promises are binding; and neither test can be applied successfully where the promisor wholly lacks capacity, or where for any other reason than lack of consideration the promise is void."1 For the same reason a promise in a bilateral agreement which is void for lack of a proper counter-promise to serve as consideration, is itself insufficient consideration, since it is not binding, and is therefore valueless. This is an obvious consequence of the requirement of consideration in bilateral contracts. The principle is ordinarily stated in the axiom that in a bilateral agreement both promises must be binding or neither is binding.72 In recent years in a few States this application of the law of consideration has sometimes been referred to as if based on some special requirement of "mutuality,' but no other doctrine than that of consideration is involved.73 $ 103f. Final definition of valid consideration in bilateral contracts. Before a final summary is attempted it should be observed that it is not essential in order that a promise shall be sufficient 71 "A promise is a good consideration for a promise. But no promise constitutes a consideration which is not obligatory upon the party promising," per Sanborn, J. Coldblast Transportation Co. v. Kansas City Bolt & Nut Co., 114 Fed. 77, 52 C. C. A. 25, 57 L. R. A. 696. A contract must be obligatory upon both parties so that each may have an action upon it. McGowin &c. Co. v. R. J. & B. F. Camp Lumber Co., 192 Ala. 35, 68 So. 263, 264. 72 "Either all is a nudum pactum or else the one promise is as good as the other." Harrison v. Cage, 5 Mod. 4118, per Holt, C. J.: "The promises must be concurrent and obligatory upon each at the same time to render either binding." Morrow v. Southern Express Co., 101 Ga. 810, 28 S. E. 998; Simpson v. Sanders, 130 Ga. 265, 268, 60 S. E. 541; Reding v. Anderson, 72 Ia. 498, 34 N. W. 300; Citizens' Nat. Life Ins. Co. v. Murphy, 154 Ky. 88, 156 S. W. 1069; El Paso, etc., R. Co. v. Eichel (Tex. Civ. App.), 130 S. W. 922. 73 See criticism of this terminology, infra, § 140. consideration that its performance will certainly prove detrimental to the promisor or beneficial to the promisee. A conditional promise is sufficient consideration. The performance of such a promise does not necessarily involve either detriment or benefit, since the condition upon which any action of the promisor is to take place may not happen. But the possibility that the condition may happen, involves a chance of detriment which is sufficient to make the promise valid consideration.74 Even though the condition in a promise relates to an unknown fact which is already determined so that if the parties knew the truth it would be apparent that the promisor really bound himself for nothing the consideration is sufficient.75 The result of this argument is that no briefer definition of sufficient consideration in a bilateral contract can be given than this: Mutual promises in each of which the promisor undertakes some act or forbearance that will be, or apparently may be, detrimental to the promisor or beneficial to the promisee, and neither of which is rendered void by any rule of law other than that relating to consideration, are sufficient consideration for one another. Cases where a promisor warrants the truth of existing facts have been put in opposition to the argument that a promise must in order to furnish sufficient consideration be a promise of something which would if actually given be sufficient consideration for a unilateral contract. It is said: "I agree that a horse which I sell shall be sound, or shall win a race; or that a man shall pay his debts; or that a ship shall come safe to port: in all these cases my promise is a valid consideration for a counter-promise. Yet the soundness or speed of the horse, the solvency of the third party, or the safety of the ship could not be a valid consideration for a promise made to me.' Here, there is no inconsistency or exception. A warranty or promise of the truth of an existing fact can only be understood as meaning a promise to be responsible in damages there was a valuable consideration for the promise to pay. Jones v. Mæs, 76 Wash. 517, 136 Pac. 680. 74 See infra, § 112. Where under the law three of the thirteen saloons in a town would be compelled to go out of business, and the saloon keepers agree that three of them, including plaintiff, should be given $400 each to retire, 75 See infra, § 119. 76 Professor Beale, 17 Harv. L. Rev. 82. if the fact asserted is not true. The warranty of the existence of an event in the future when construed means either a promise to bring about the existence of the event or a promise to pay damages if the event does not happen," and either the present causation of the fact or the present payment of damages for the unsoundness or lack of speed of the horse, the insolvency of the third party, or the loss of the ship would be as sufficient consideration as the promise of warranty. § 104. A promise which by its terms may be performed without detriment to the promisor or benefit to the promisee is insufficient consideration. What have already been referred to as illusory promises are insufficient consideration.78 Such a promise is a promise merely in form. Even if recognized by law it would impose no obligation, since the promisor by virtue of the condition always has it in his power to keep his promise and yet escape performance of anything detrimental to himself or beneficial to the promisee. Such a condition is called in the Civil Law a potestative condition.79 The insufficiency of such a promise as consideration is most commonly illustrated in agreements to buy or sell goods where the quantity is fixed by the wishes of one of the parties. A promise to buy such a quantity of goods as the buyer may thereafter order,80 or to take goods in such quantities "as may be desired," or as the buyer "may want "'81 is not sufficient consideration since the buyer may Bolt Co., 114 Fed. 77, 52 C. C. A. 25, 57 L. R. A. 696; T. B. Walker Mfg. Co. v. Swift, 200 Fed. 529, 119 C. C. A. 27; Las Palmas Winery v. Garrett, 167 Cal. 397, 139 Pac. 1077. See also Gross v. Stampler, 165 N. Y. S. 214. See also Pratt Consolidated Coal Co. v. Short, 191 Ala. 378, 68 So. 63; Buick Motor Co. v. Thompson, 138 Ga. 282, 75 S. E. 354. 81 American Cotton Oil Co. v. Kirk, 68 Fed. 791, 15 C. C. A. 540; Columbia Wire Co. v. Freeman Wire Co., 71 Fed. 302; Higbie v. Rust, 211 Ill. 333, 336, 71 N. E. 1010; Parks v. Griffith & Boyd Co., 123 Md. 233, 91 Atl. 581; پرو |