McKenzie v. Stewart

SOMERVILLE, J. The bill of complaint in this case is nominally one for the specific performance of the respondent’s agreement to accept 15 shares of corporation stock in lieu of $1,500 in • money in satisfaction of a mortgage note for that amount. But it is, in substance and effect, a bill for redemption, and we shall so treat it. (1) If, upon a valid consideration a mortgagee agrees with Ms' mortgagor or his privy, to accept certain property in payment of the mortgage debt, a due and seasonable tender of the property is, of course, the equivalent of a tender of the money originally due. Such an agreement merely arms the mortgagor with an option as to the mode of payment. The real question in this case therefore is: Does the bill of complaint show a valid consideration for respondent’s promise to accept the stock in lieu of the money originally due him? (2) There is obviously no question here involving the statute of frauds, even conceding that the bill shows only a verbal agreement; for there was no agreement with respect to a conveyance of land. It is true that the result of respondent’s acceptance of the stock would be the release of the land from the mortgage, but the same result would follow from his acceptance of money also; and in either case the release of the land results incidentally from the operation of law, and not from any agreement of the parties. Had respondent’s agreement been to convey the land to Storrs on the consideration stated, the situation would be quite different. The agreement here shown did not change any part of a contract which the statute requires to be in writing, and hence, though merely verbal, it might become binding.— 20 Cyc. 287, F; Lehman v. Marshall, 47 Ala. 362, 376; Griswold v. Griswold, 7 Lans. (N. Y.) 72. (3) The note which this mortgage secured was an ordinary written contract for the payment of money, and, like other ordinary written contracts, its terms could be modified by subsequent parol agreement, if supported by a valid consideration.—Langford v. Cummings, 4 Ala. 46; 9 Cyc. 593, B. With respect to the consideration for respondent’s agreement with complainants, two questions are presented: (1) Did either any benefit move to respondent, or any detriment or dis [244] advantage accrue to complainants? and (2) was there mutuality of obligation? (4) Assuming for the moment the second essential, it is clear that respondent’s agreement to accept the stock in payment of Stewart’s debt would have been sufficiently supported by Stewart’s agreement to procure and deliver the stock to respondent, and also by Storrs’ agreement to furnish the stock to Stewart for that purpose. For Stewart would divest himself of a. valuable asset, his land, and Storrs would part with a valuable asset, his stock — a manifest disadvantage to each, unless the stipulated part of the stock is to satisfy the debt and remove the incumbrance on the land purchased by Storrs from Stewart. But, it is said, Stewart and Storrs did not bind themselves, the one to supply, and the other to procure and deliver, the stock to' respondent for the purpose stated, and hence respondent’s agreement to accept it is not binding for want of mutuality of obligation.' (5) The law on this subject is well settled: “Although there is a lack of mutuality in the beginning, this may be cured by the other party subsequently binding himself also by promise or act. Thus, if A, promise B, to pay him a sum of money if he will do a particular act or make a particular promise, and B, does the act, the promise thereupon becomes binding, although B, at.the time of the promise does not engage to do the act or make the promise. In the intermediate time the obligation of the promise is suspended, for until the performance of the condition of the promise there is no consideration, and the promise is nudum pactum; but on the performance of the condition by the promisee it is clothed with a valid consideration which relates back to the promise, and it then becomes obligatory. Therefore a contract to pay a certain sum upon the performance of certain acts by another becomes a binding obligation upon the promisor on the performance of said acts before the revocation of the contract, although it express no consideration past or present and contain no promise that such acts shall be performed.” — 9 Cyc. 334 (V), and cases cited. It is simply the acceptance of an offer by the- performance of the condition stipulated, which then becomes an executed consideration. It may be that, considered merely as a bill for the specific performance of a verbal agreement of the character shown, the [245] bill of complaint here exhibited would be without equity by reason of the adequacy of legal remedies.—Moses v. Scott, 84 Ala. 608, 4 South. 742. But the scope of the bill must be determined by its allegations and the object sought to be attained; and, regarding it, as it patently is, as a bill for redemption of land, it contains equity, and is not subject to any of the grounds of demurrer assigned. If its allegations are supported by proof, the appropriate relief can be granted under the general prayer. The decree overruling the demurrer will be affirmed. Affirmed. Anderson, C. J., and Mayfield and Thomas, JJ., concur.