Cabot v. Haskinn

Parker C. J. delivered the opinion of the Court. The first objection stated to the verdict in this case is, that admitting the promise, as declared on, to be proved, yet it appears that the consideration moved as well from Lovering, who was no parly to the promise or to the action, as from the three plaintiffs, and therefore that the action cannot be maintained ; but, we think ;t immaterial from whom the consideration, if it be a sufficient foundation for a valid promise, passed. We think there is no doubt, if A advances money to B, who in consideration thereof at A’s request promises to pay C, that C may maintain an action upon this promise. See the opinion of Eyre C. J. and the whole court in the case of the Company of Feltmakers v. Davis, and of Butter J. in the case of Marchington v. Vernon cited in a note to that case, and of this Court in the case of Felton v. Dickerson, 10 Mass. R. 287.1 [92] With respect to the consideration of the promise there has been more difficulty in deciding. This consideration is proved ny the testimony of William Lovering, and is in substance this, that the defendants, whose property was in the hands of the plaintiffs and Lovering for the purpose of raising money for distribution among the creditors of the defendants, proposed to the plaintiffs, who were agents and attorneys for the creditors, to pay in a short day a sum sufficient to discharge 43 per cent, of the debts, and 700 dollars to the attorneys fo. their trouble, provided the plaintiffs would surrender to them the property which they held and would discharge them from their debts ; that the plaintiffs declined, on account of their supposed liability to the United States for the debts of the defendants because of the property in their hands ; and that to avoid this objection the defendants promised to pay the plaintiffs 1000 dollars as and for an indemnity for the risk which they ran upon this account, which risk the plaintiffs were to take upon themselves ; and this proposition was accepted. This promise was made upon a supposition or belief that the United States had a priority of lien upon the property of the defendants, in consequence of their declared inability to pay their debts and of the assignment of their property to the plaintiffs. If they were mistaken in this supposition and the United States had no such claim, there would be no real, but only an apparent consideration for the promise, and it would consist neither with law nor equity that the payment of this sum should be exacted. Now it seems to be clearly settled by this Court in the case of Prince v. Bartlett, 9 Mass. R. 431, by the Supreme Court of New York in M'Lean v. Rankin, 3 Johns. R. 369, and by the Supreme Court of the United States in 8 Cranch, 431, where there was a revision of the same case of Prince v. Bartlett, that the United States have no priority in a case like this, because there was no bankruptcy and no insolvency, in the sense intended by Congress in the act whereby the priority of the United States is established.1 There seems to be then no [93] valuable consideration for this promise to stand upon, and the money, if paid, would be paid for nothing. We cannot suppose that a mere ideal danger, which has ro foundation in fact or in law, can form the substratum of a contract by which the one who assumes it can claim indemnity. Even in the contract of insurance there must be some risk to entitle a party to the premium, and if it turns out that there was none, although some may have been supposed at the time when the contract was made, the premium cannot be recovered. There must be as a lega, foundation for a promise, either an actual damage, or a suspension or forbearance of right, or a possibility of loss occasioned to the one to whom the promise is made, to give it validity. It is not material that any actual benefit should accrue to the party undertaking. Vide 1 Wms’s Saund. 211, note 2 ; 2 Wms’s Saund. 137, note 2. Here was no damage, nor any forbearance or suspension of right, nor any possibility of loss in the legal sense of that phrase, for it had long before been decided by the ultimate authority that the United States had no claim.2 It has been urged by counsel, that the sum promised was part of the consideration for giving up the goods, or at least was a compensation to the plaintiffs for their trouble and responsibility ; but this latter was compensated for by the 700 dollars which were stipulated to be given ; and with respect to the former, if it was the consideration for giving up the goods, it should seem to belong to the general fund for distribution among the creditors, whereas it was intended for, and is now claimed by, the plaintiffs to their own use. Indeed the testimony of Lovering puts this in a clear light, for he states, that this 1000 dollars was an indemnity only for the supposed liability of the four agents, of whom he was one, and it was so treated by them, for he assigned over his quarter part upon an indemnity against this liability. We are bound to consider this the only consideration, and for the reasons given, it is insufficient. It is true that the jury stated it as their belief, that the promise was made, as well on account of the benefit expected by the defendants, as for the risk assumed by the plaintiffs, but [94] there is no evidence from which they could legally infer that this expected benefit made part of the actual consideration. It was without doubt a motive or inducement to them to yield to the claims of the other party, but was not the consideration, in a legal point of view, of the promise. A man may have motives of self-convenience to promise to pay the debt of another, but ye t without a legal consideration such a promise would be void. Such being our opinion upon this point, we might be relieved from the necessity of considering the application of the statute of frauds, in relation to which much argument and ingenuity have been exhibited. This promise was to be performed only at the end of five years from the time when it was made ; so that, if it be within the words or the clear meaning of the statute, and it be not in writing, no action can be sustained on it. It was argued that the statute intended only mutual agreements, in which both parties stipulate to do something, and not a mere promise by one to pay money to another ; but we do not find that such a construction has ever been given to the statute; nor would such a construction comport with the obvious intent of the legislature, which was to require written proof of contracts to be performed in future, in order that the uncertainties resulting from verbal testimony might be avoided. It was urged also, that the plaintiffs were to deliver the goods within six months, and that where there is a mutual agreement, and either party is to perform in less than a year, the contract is not within the statute.1 This proceeds upon the hypothesis that the delivery of the goods made a part of the consideration for this promise, which we have before seen is not the case. We consider this contract respecting the 1000 dollars as wholly independent of the compromise. The latter was made for the benefit of the creditors, the former for the benefit of the plaintiffs alonel They seem to be wholly independent of each other. Nor is the promise in writing within the terms of the statute. It must, not only be in writing, but it must be signed by the party to be charged. It is true that much liberality has been used in regard to this requisition of the statute, so that if the [95] name of the party appears on the instrument, written by himself, though not signed, in the common understanding of that term, it has yet been held sufficient. But the memorandum at the foot of the mortgage is the declaration or acknowledgment of the plaintiffs, not of the defendants ; their name is nowhere written by themselves, so that it would certainly be an unwarrantable stretching of the statute, to call that memorandum a writing signed by the defendants who are to be charged. As to the suggestion, that the agreement has been partly performed and so ought on principles of equity to be enforced,2 that depends again upon the question, whether the agreement to deliver the goods formed the consideration of the promise to pay the money, and upon this we have given our opinion. We see no evidence of fraud on the part of the defendants in relation to the incumbrance on the mortgaged estate ; they might honestly suppose that only one half of the debt attached to the moiety of the premises conveyed by them ; and if there were fraud in this particular, we do not see how that can supply the want of those formalities which the law requires to substantiate a promise, which by the terms of it is not to be executed until more than a year has elapsed from the time of making it. Verdict set aside. Footnotes [1] But an indebtment to three jointly is not a sufficient consideration to [92] support a promise to one separately for his portion of the debt, either express or implied. Vadakin v. Soper, 1 Aiken, 287. [1] Watkins v. Otis, 2 Vick. (2nd ed.) 102, note 1 [2] Hunt v. Swain, 1 Lev. 165; Jones v. Ashburnham, 4 East, 455; Tooley v Windham Cro. Eliz. 206; Lent v. Padelford, 10 Mass. R. 236. [1] See per Lord Ellenborough, 11 East, 152; per Abbott J., 1 Barn. & Ald. 727 [2] The provisions of this statute render a parol contract void, if it appear to have been the understanding of the parties at the time, that it was not to be completed within a year, although it might be, and was in fact, in part performed within that period. Boydell v. Drummond, 11 East, 142; Bracegirdle v. Heald, 1 Barn. & Ald. 722; Squire v. Whipple, 1 Vermont R. 69; Chitty’s Contr. (3d Amer. edit.) 207, 208; Lower v. Winters, 7 Cowen, 263; Snelling v. Huntingfield, 1 Crompt. Mees. & Roscoe, 20; S. C. 4 Tyr. Exch. R. 606. The statute of frauds has no application to a contract, that hag been fully performed on both sides. Stone v. Dennison, 13 Pick. 1. Whether a part-performance is ever an answer to the statute, except in courts of equity, quœre. Squire v. Whipple, 1 Vermont R. 69. See Stone v. Dennison, 13 Pick. 1; Bates v. Moore, 2 Bailey, 614. But where a contract within the statute of frauds has been in part executed by one party, there is a plain remedy for such party to a certain extent, in a court of law, if the other party fraudulently refuses to execute the contract on Ms part. Ii money has been paid, it may be recovered back. If labor has been performed a compensation for it may be recovered. Lane v. Shackford, 5 N. Hamp. R. 133; Holbrook v. Armstrong, 1 Fairfield, 31; Kidder v. Hunt, 1 Pick. 328; Little v. Martin, 3 Wendell, 219; Shute v. Dorr, 5 Wendell, 204; Burlingame [96] v. Burlingame, 7 Cowen, 92; Gary v. Hull, 11 Johns. R. 441; Donellan v. Read, 3 Barn. & Adol. 899. Equity will relieve in cases of part-performance. Marks v. Pell, 1 Johns. Ch. R. 594; Strong v. Stewart, 4 Johns. Ch. R. 167; Washburn v. Merrills, 1 Day, 139; Daniels v. Alvord, 2 Root, 196; Ross v. Nowell, l Wash. 15; Watkins v. Stockett, 6 Harr. & M'Hen. 24; Wilcox v. Morris, 1 Murphey, 117; Wilcox v. Carver, 1 Haywood, 93; Belton v. Avery, 2 Root, 279, Wheeland v. Swartz, 1 Yeates, 579; Mackey v. Brownfield, 13 Serg. & Rawle, 239; Crocker v. Higgins, 7 Connect. R. 342. An agreement to marry within five years, is within the statute. Derby v. Phelps, 2 N. Hamp. R. 515.