Fitzsimons v. Eagle Brewing Co.Fitzsimons v. Eagle Brewing Co.
The facts of the case at bar are reminiscent. The plaintiff-appellant, a Baltimorean, operating as the Camden Products Company (New Jersey), manufactured malt syrup, a primary ingredient in the brewing of beer. The defendantappellee, a brewery, for reasons undisclosed by the record but easily conjecturable by United States Judges, lost its permit for the manufacture of near beer, the then legal kind,
The judicial opposition to the “stipulation for iniquity”, as the ancient cases put it, is contemporaneous with the law of contract itself. Thus the Institutes of Justinian provide:
“A promise for some base end, as to kill a man or to commit sacrilege, is not valid”. Institutes of Justinian, 3rd book, 19th title, 24th section.
“No mandate is binding that is contrary to good morals, as when Titius gives you a mandate to steal, to do harm, or to injure any one. For although you undergo punishment on account of that very deed, yet against Titius you have no action”. Institutes of Justinian, 3rd book, 26th title, 7th section; Institutes of Gaius, 3rd book, 157th section.
The rule has two aspects — one theoretical and the other practical. 6 R.C.L. sec. 98; 2 Restatement of Contracts, sec. 598, p. 1110. The law helps the good and hinders the bad and not vice versa; at least that is the general idea. The comment to section 598 of 2 Restatement of Contracts puts it thus:
“ * * * the rule of public policy that forbids an action for damages for breach of such an agreement is not based on the impropriety of compelling the defendant to pay the damages. That in itself would generally be a desirable thing. When relief is denied it is because the plaintiff is a wrongdoer, and to such a person the law denies relief. Courts do not wish to aid a man who founds his cause of action upon his own immoral or illegal act. If from the plaintiff’s own statement or otherwise it appears that the bargain forming the basis of the action is opposed to public policy or transgresses statutory prohibitions, the courts ordinarily give him no assistance. The court’s refusal is not for the sake of the defendant, but because it will not aid such a plaintiff”. 2 Restate-rnent of Contracts sec. 598, p. 1110.
This particular high-minded attitude has a mundane result, something that does not always follow. It discourages such transactions, Hope v. Linden Park Blood Horse Ass’n,
The principal case gives us the easiest example of an illegal contract. We are not troubled with a violation of the sometimes vague rules of the common law, 13 C.J. p. 468, or even vaguer and more varying tenets of morals, 15 Amer. & Eng. Ency. of Law (2nd Ed.) p. 959, or public policy, 13 C.J. p. 424; 15 Amer. & Eng. Ency. of Law (2nd Ed.) p. 983. Our contract cannot be performed without the violation of an express statute,
All this is just about conceded. What is not conceded is a question of timing. As there is a conflict of laws as to place, so there may be a conflict of laws as to time. As Professor Williston puts it: “It may sometimes happen that a bargain is illegal when it is made either because of the illegal purpose of the parties to it or for other reasons, and that when the bargain is performed the transaction has become lawful either because the purpose of the parties has changed or because changes in the law or other external circumstances have made that lawful which was previously unlawful”. 6 Williston on Contracts, sec. 1758, p. 4992.
The appellant urges that the validity of the agreement does not depend upon the law at the time it was made. In so doing, he runs counter to the overwhelming weight of authority. 6 Williston on Contracts, sec. 1758, above cited, 12 Amer. *714 Jur. sea 165; 15 Amer. & Eng.Ency. of Law (2nd Ed.) p. 942; 2 Restatement of Contracts, sec. 609, p. 1128. The cases cited in support of these texts hold that the subsequent repeal of a prohibitive statute does not authorize recovery under the contract originally forbidden.
We cannot understand any other view. By definition your purpose is to discourage action deemed harmful. You are not interested in the consequences of acts but in the mental processes of the actor. Those processes precede both the acts and a fortiori their consequences and the relevant state of law is that existing at the time of the processes and not at the time of -the consequences. The law breaking mens rea has reference to the time of contemplated breach. The medicine tastes nasty when it is swallowed.
The decisions disclose several exceptions to this general rule. 6 Williston on Contracts, sec. 1758. Of the two most pertinent, one is studied, the other fortuitous. For the first, usury (now supported by weight of authority, 2 Restatement of Contracts, sec. 609(b); 6 Williston on Contracts, sec. 1683, pp. 4762-3;
A striking parallel to the usury cases exists in our particular field. 33 C.J. p. 665. When recovery of the selling price of liquor is prohibited by statute, it is allowed after repeal. See Gorsuth v. Butterfield,
“Recognizing the existence of a divergency of judicial attitudes on the question of whether an agreement, illegal at its inception, is rendered enforceable by a legislative enactment legalizing the formation of such agreements, the instant court purported both to apply firmly established New York law and also to follow the Restatement. As a matter of fact, it did neither; for there are conflicting New York decisions and the Restatement positively advocates a contrary ruling”. 85 University of Pennsylvania Law Review 535, 536.
See also, 14 New York University Law Quarterly Review 536 (note), 6 Brooklyn Law Review 770 (note), and compare 50 Harvard Law Review 834 (note).
In conclusion, we observe, that despite the presence of more than the usual amount of perjury (as the learned trial judge noticed, R. 44), plaintiff-appellant has failed to place itself in any position other than “in pari delicto”. See 5 Williston on Contracts sec. 1631; 2 Restatement of Contracts, above cited, secs. 598, comment (b), 559, 602, and 604.
The judgment of .the District Court is affirmed.