Underwood Typewriter Co. v. Century Realty Co.

LAMM, J. This case is here from the St. Louis Court of Appeals on the dissent of Judge Bland. [118 Mo. App. 197.] The majority opinion of that court reversed the judgment of the circuit court sustaining a demurrer to the petition and remanded the case to he tried on its merits. We think the majority opinion is soundly reasoned on both principle and precedent. It should be read in connection with this; for we shall not restate its reasoning but rest content with adopting it, only supplying a sufficient statement here to make this opinion intelligible, and adding some observations of our own. THE STATEMENT: Plaintiff was tenant of defendant in possession under a written lease for a five524 year term "beginning on the first day of February, 1901, and ending on the last day of January, 1906. The lease provided, inter alia, that plaintiff could not assign or underlet without the written consent of defendant indorsed on it. Thereafter plaintiff and defendant entered into a written agreement to the effect that defendant would give its written assent to an assignment of the lease to an acceptable tenant. The petition pleads the lease, the provision against assigning or subletting and the subsequent written agreement to give consent in "writing to an acceptable tenant and then states, in substance, that plaintiff in reliance on said written agreement, with the knowledge of defendant, expended a large amount of time and labor in securing an acceptable and satisfactory tenant and did secure such tenant, but that, notwithstanding that fact, defendant refused and still refuses to consent to the assignment of said lease and to permit said tenant to enter into the possession of said premises, though often requested to do so. That by reason of defendant’s refusal to consent to said assignment of said lease plaintiff was and is prevented by defendant from securing such tenant at a large advance over the rent reserved by defendant under said lease, to its damage in the sum of $4,500. Wherefore, etc. The circuit court sustained a general demurrer to the petition. Thereat plaintiff stood on its petition and, refusing to plead over, judgment went on the demurrer. From that judgment plaintiff appealed to the Court of Appeals, with the result indicated. When the case came here it was assigned to Division One and there argued and submitted. That division was evenly divided and the cause came into Banc. So much by way of statement. THE OBSERVATIONS: True, the typewriter company was not bound to do anything under the written agreement. True, it was executory only, and may be called in a sense a nude pact as born. True, defendant realty — 525 — company conld at no time have sued the typewriter company on that agreement for failure to perform. Why should it sue? It already had a tenant in the person of the typewriter company. It wanted no other. But mutuality, in its essence, is but a phase, strictly speaking, of the consideration that will support a contract. It is not the only phase. If mutuality, in a broad sense, was held to be an essential element in every valid contract, to the extent that both contracting parties could sue on it, there could be no such a thing as a valid unilateral or option contract, or a contract evidenced by a subscription paper, or a contract to enforce a reward offer, or a guaranty, or in many other instances readily put in ordinary business affairs. The contract sued on in this case was made for the benefit of the typewriter company. It could furnish an acceptable tenant to defendant to take its place, or let it alone. In that respect it does not differ from many contracts, the breach of which is actionable at the option of the promisee. Being in writing, and signed by the party to be charged, it was not obnoxious to the Statute of Frauds. Being fully performed by the promisee, it was no longer a nude pact but became clothed with a consideration executed on request. That performance on the strength of the offer made, having been accomplished at an outlay of time and labor on the part of the offeree or promisee, with defendant’s knowledge, as alleged in the petition, makes it enforcible against the offerer or promisor so long as both parties were capable of contracting and their contract be not vitiated by fraud or as against good morals or public policy. We take it as good doctrine worthy of all acceptance that it is the primary duty of courts to enforce contracts, not to abrogate them. A contract (such as this) between two parties not in fiduciary relation but dealing at arms-length, free from taint of fraud, duress — 526 — or other form of overreaching or oppression, when performed hy the promisee, comes into a court of justice entitled to every fair presumption of validity. Such a contract bespeaks, in the first instance, judicial diligence and astuteness to support the act of the party hy the act and art of the law. To that extent, at least, those fine rules of personal honor obtaining between man and man, requiring one to keep his word with another, accord with the rules of law. It is afield to point to the contract word, “acceptable,” and say that it would he illusory or unthinkable to suppose that its terms could he complied with hy the plaintiff by its furnishing a tenant acceptable to the landlord. As to whether a landlord could stand on mere whim and caprice or some fanciful conceit in rejecting a party furnished hy his tenant, under the contract sued on and the lease out of which it grew, we need not inquire. It is likely his refusal would have to stand on something better than mere caprice and whim. It is likely the law would compel such landlord to acquit himself hy acting with reason and that courts would hold that the contract implied he would so act. But in this case, as pointed in the majority opinion in the Court of Appeals, the petition says that the party furnished was acceptable. The demurrer assumes that allegation true; hence, for present purposes, it is true. Discussing the question of mutuality, a law-writer whose views are fortified hy the weight due to a virile and a luminous mind, enriched with great research and strengthened hy a profound grasp of legal principles, lays down the right doctrine to he: “But if without any promise whatever, the promisee does the thing required, then the promisor is hound on another ground. The thing done is itself a sufficient and a completed consideration; and the original promise to do something, if the other party would do something, is a continuing promise until the other party — 527 — does the thing required of him. A very large proportion of our most common contracts rests upon this principle.” [1 Parsons on Contracts (9 Ed.), bottom p. 488.] . _ In a learned note to American Cotton Oil Co. v. Kirk, 15 C. C. A. 543, Mr. Clark, author of Clark on Contracts, in speaking to the point says: “Again, contracts may be formed by the offer of a promise for an act and acceptance by performing the act, as where a man requests another to perform services for him, and the latter does so. The request is an offer of a promise to pay for the services, and performance of the services is an acceptance of the offer. This is described as consideration executed upon request. Here, also, the act of one party forms the consideration which supports the promise of the other. In these two cases one of the parties, in the formation of the contract, does all that he can be required to do, and there remains an outstanding obligation on the other side only. The contract is unilateral. It is obvious that in these cases the question of mutuality of obligation or contract cannot arise. The question is whether the act is such as to supply a consideration for the promise of the other party.” To illustrate, if Roe write Doe: “If you loan Lowe your Jersey cow, I will see she is returned in good order.” And, if Doe (relying) loan her to Lowe and she is not returned in good order, is Roe not liable to Doe? If Box write Cox: “If you find my lost horses, Bucephalus and Rosinante, I will release the debt of $50 you owe me.” And if Cox (relying) find and return Bucephalus and Rosinante, is his debt not paid to Box? If Smith agree in writing with Jehu that he will pay him $100, if he drive from Jefferson City to Kansas City and return in four days, and Jehu presently (relying) drives it in four days, is not Smith liable? — 528 — If John agree in writing with Gambrinus that if the latter will not drink beer for a year, he will pay him a sum certain, and if Gambrinus (relying) drink no beer for that year, is not John bound? Yet in each of these cases neither Doe, Cox, Jehu, or Gambrinus was bound to do anything. In each of them there was no consideration other than acceptance by actual performance on request. In the last two and the first no benefit accrued to Roe, Smith or John. But in each of them there was a consideration (%. e., performance), moving from the promisee in the form of labor done and inconvenience and detriment suffered. In an old case, Lindell v. Rokes, 60 Mo. 249, Rokes agreed to pay Lindell $50, if he would not use intoxicating liquors and beer for one year. Lindell performed. Rokes refused to pay, and, being sued, set up a want of consideration as a defense. The learned judge deciding that case referred to the statute (R. S. 1899, sec. 894) ordaining that: “All instruments of writing made and signed by any person or his agent, whereby he shall promise to pay to any other or his order, or unto bearer, any sum of money or property therein mentioned, shall import a consideration, and be due and payable as therein specified.” But bis reference to that statute was merely arguendo. The case was put on the reason of the thing and the law was declared to be that: “It is true that the plaintiff did not undertake, in direct terms, to do anything when the note was made, but the prevailing doctrine now is that, if one promise to pay another a sum of money if he will do a particular act, and he does the act, the contract is not void for want of mutuality, and the promisor is liable, though the promisee did not at the time of the promise engage to do the act; for upon the performance of the condition by the promisee, the contract becomes clothed with a valid consideration, — 529 — which relates hack and renders the promise obligatory. ’ ’ Referring to section 894, supra, it should be observed that it merely directs that the particular kind of contract within the purview of the lawmaker shall import a consideration — that is, a consideration need not be pleaded, in the first' instance. [County of Montgomery v. Auchley, 92 Mo. l. c. 129.] In other cases it is necessary to plead the consideration and prove it, whether by the contract or aliunde, we need not consider; for in this case the contract states the promise and points the consideration, viz.: the act of performance in^furnishing an acceptable tenant. And in all cases on contracts it is open to the defendant to plead and prove a,want or failure of consideration. [R. S. 1899, section 645.] In the case just quoted, the contract in evidence showed no consideration passed to the promisor, so that the law announced by the court became pertinent to that view of the case. In another case (Williams v. Jensen, 75 Mo. 681), Stonebreaker, as principal, and Jensen, as surety, executed a note to Williams. Being sued on the note, Jensen contended that he was released from liability on two grounds. One of them was an extension of time to the principal by a valid contract without his consent. It was held that the contract to extend was valid as supported by a sufficient consideration, hence Jensen was discharged as surety. The consideration for the extension agreement arose in this way. When the note was about due,Williams agreed with Stone-breaker he would extend the time to a date certain if Stonebreaker would get his wife to sign the note. Stonebreaker procured this to be done without his surety’s knowledge or consent. The signature of Mrs. Stonebreaker was worthless, as the law then stood, she being a married woman with no separate estate, and Williams contended there was no consideration — 530 — for the extension agreement. But this court, disallowing that contention, said: “Whatever may have been his motive, he agreed to extend the time of payment upon the condition that her husband would obtain her •signature to the note; and the obtainment of her signature, though such signature be of no value to Williams, constitutes a sufficient consideration for his agreement to extend the time of payment. It is not always necessary that the consideration for a promise should be of some value to the promisor. Damage or inconvenience to the promisee is a sufficient consideration, and where the court can see that there may have been such inconvenience it will uphold the contract. It may have been an inconvenience for Stonebreaker to secure the signature of his wife, and this much appearing, the law will shut its eyes to the inequality between the consideration and the promise.” At this point the court cites Lindell v. Rokes, supra. Continuing, the court said: “In Brooks v. Ball, 18 Johns. 337, a promise to pay a certain demand if the claimant would swear to its correctness, was enforced. Any trouble or labor, however slight, undertaken by one person at the request of another, will support a promise by such other person, although the trouble or labor be of no benefit to the promisor. [Addison on Conts. (Morgan’s Ed.), sec. 9; Clark v. Sigourney, 17 Conn. 511.] Being of opinion that the agreement to extend the time of payment was supported by a sufficient consideration, the judgment, which was for the defendant, will be affirmed.” In a late ease in Banc (Strode v. Railroad, 197 Mo. l. c. 622, et seq.), to which we all agreed, our Brother Graves reviewed authorities and case-learning on the question of consideration and announced the right doctrine to be, as laid down in 6 Am. and Eng. Ency. of Law (2 Ed.), 689, viz.: “If the promisee do any act to his injury, however slight, at the request of the — 531 — promisor, either express or implied, the detriment sustained operates as a consideration.” Barclay, J., in Trustees of Christian Univ. v. Hoffman, 95 Mo. App. l. c. 495, with the concurrence of all his learned brethren, said: “But, apart from the inference of law arising under the above-mentioned statute” (R. S. 1889, sec. 894, supra), “it has been held that where such a promise as that under review has been made to an institution like that of the plaintiffs, and, before the promise is withdrawn, obligations have been created or expenses incurred by the promisee upon the faith of the promise, these facts furnish, a consideration to support the original agreement, although, in the first instance, it may have partaken somewhat of the nature of a gift. [Koch v. Lay, 38 Mo. 147; Pitt v. Gentle, 49 Mo. 74; Corrigan v. Detseh, 61 Mo. 290; School District v. Sheidley, 138 Mo. 672.] ” See also, authorities collected in the principal opinion, 118 Mo. App. 197, and there applied. But I have pursued the matter further than intended. The upshot of it all is the conclusion that the petition was good and the demurrer bad. Hence, the judgment of the circuit court should be reversed and the cause remanded to be tried on its merits. It is so ordered. Gantt, Fox and Graves, JJ., concur; Woodson, J., dissents in an opinion filed, in which Valliant, C. J., and Burgess, J., concur.