Justice v. Lang

| The Superior Court of New York City | May 28, 1864

Lead Opinion

Robertson, Ch. J.

The statute of frauds requires a written note or memorandum of every contract for the sale of goods, chattels, and choses in action, to be signed by the “parties to be charged therewith,” in order to make it binding, unless some of the articles sold have been delivered, or the price of them paid. (2 R. S. 136, § 3.) Of course at common law, in order to make such contract binding, it is necessary that a consideration, executed or executory, should move from each party to make that of the other binding. If the agreement of the vendor to sell and of the vendee to buy, constitute mutual considerations for each other, both parties 'must be bound by such contract to make it obligatory on either; consequently the statute has required such contract to be signed by the buyer as well as the seller, in order to make the former chargeable therewith. Unless, therefore, such statute meant to go farther than merely to require a written contract to be signed by both parties as a mode of obligation, in the alternative, with a delivery and acceptance of part of the goods or a payment and receipt of part of the price (which equally required an act to be done by both parties) and actually to abolish the rule of the common law as to the necessity of a consideration, no such contract could be binding under it unless signed by both parties.

It is to be noticed that in the same statute the section respecting agreements to last over a year in their performance, and to pay the debts of third persons, or in consideration of marriage, employs the same language as the clause already alluded to, which requires the contract to be signed by the parties, (2 R. S. 135, § 2,) immediately after requiring interests, trusts and estates in land or powers over it to be granted, created, assigned or surrendered by a conveyance in writing, subscribed merely by the party creating, granting, assigning or surrendering the same alone,. or his agent duly appointed, in writing. (2 R. S. 134, § 6.) Such statute also required a lease of land for over one year, and any agreement for the sale of any interest therein, which it prescribed should be made in writing, to be signed merely by the party by whom the lease or sale v)as to be made, (2 R. S. 135, § 8,) without regard to the lessee or vendee. Consequently, courts of equity early took the ground that specific performance of agreements in relation to land could be enforced when signed by the vendor only, (Halton v. Gray, Eg. Cas. Abr. pl. 10 ;) and that doctrine, after-some hesitation and struggle, as may be seen by the cases examined by Chancellor Kent in Clason v. Bailey, (14 John. 484,) was finally adhered to in this state. But in England even the cases of Egerton v. Matthews, (6 East, 307,) and Saunderson v. Jackson, (2 Bos. & Pul. 238,) erroneously cited in Russell v. Nicoll, (3 Wend, 113,) as referring to contracts for sales of goods, which sustained such view, have been questioned, and Lord Kenyon, in Charles v. Beckett, (7 Term Rep. 17,) alone, and in Cooper v. Elston, reported in the same volume, (p. 17,) jointly with Baron Grose, deplored such departure from the strict letter of the statute. In fact, however, such doctrine in the court of equity is justified only by assuming that the statute does not affect the liability of a vendee or lessee, who may bind himself orally, in consideration of the written agreement of the vendor or lessor, and thus make the contract binding on both parties without affecting the rule of law as to a nudum pactum. Without such mutuality Lord Redes dale declared in Laurenson v. Butler, (1 Sch. & L. 201,) that the statute would have been one of and not against fraud, and remarked that there was no late case in which equity had decreed performance where one party only was bound. An oral promise to pay for lands conveyed may be enforced, (Thomas v. Dickinson, 12 N. Y. Rep. 364; Murray v. Smith, 1 Duer, 412;) and there is no reason why one to pay for lands merely agreed to be conveyed in consideration of such agreement should not be so, equally. The statute in regard to contracts or conveyances affecting lands does not, in tepns, render void the promise of the purchaser or grantee to pay, unless written and signed by him, as it does the promise of the purchaser of goods, unless accompanied by part execution. It is true that a different reason was discovered by Paige, J. in Worrall v. Munn, (1 Selden, 246,) for enforcing contracts for the sale of lands, which he ventured to declare could be done, even where there was was no mutuality. That was, that the party to be charged was estopped by his signature from denying the contract to be validly executed, although not signed by the other, which after all only comes back to the same point that the statute requires it in the case of the seller, and makes that sufficient, without touching the obligation of the purchaser. The reasoning in Fenly v. Stewart, in this court, (5 Sandf. 101,) notwithstanding its artificiality, I do not understand as impugning that principle, hut merely as insisting that the party to he charged must sign, without adverting to any ground as that on which equity has enforced such contracts. There is another reason why different language should be used in regard to contracts or conveyances affecting lands and those in regard to goods. The former was always a favorite with the common law, and required peculiar protection ; whereas the latter was of less account, and merely required that both parties negotiating for a sale should have been established by incontrovertible evidence to have been in earnest and positive in making the bargain conclusively.

The principle in regard to contracts for the sale of goods has never been fully settled in this state, although sometimes assumed or stated to have been so, in obiter dicta. In the early case of Roget v. Merritt, (2 Caines, 117,) the court expressly avoided deciding the case upon the construction of this statute, and even Spencer, J. only held the defendant not to be bound because the consideration agreed (orally) by the plaintiff to be given failed, although he stated that, he thought it enough that the party who had to perform the principal part of the contract,” i. e. to deliver the goods, should sign it and the other accept it. I apprehend the payment of the price is as important a part of the whole contract as the delivery of the goods; indeed the statute expressly makes it so. The mere receipt of the written paper could impose no obligation on the recipient. In the case of Bailey v. Ogden, (3 John. 399,) the question was still kept open, Chancellor Kent declaring that the obligation of the plaintiff who alone had signed the agreement, was not a question in it. In Merritt v. Clason, (12 John. 102,) the agreement had been signed by a broker, and both counsel put the case upon the question whether he could bind both, and Justice Platt, in delivering the opinion of the court, held he could bind the defendant, and upon that ground alone the decision in that case was sustained in the Court of Errors. (S. C. sub. title Clason v. Bailey, 14 John. 484.) Even Chancellor Kent, who examined in such court of last resort the question and reviewed all the cases, including many which were confined to sales of land, and leaned towards the validity of the contract in favor of the non-signing party, expressly disclaimed “placing the cause on that ground.” In Russell v. Nicoll, (3 Wend. 112,) no objection had been taken on the trial to the validity of the contract, a nonsuit was granted on other grounds affecting the. merits ; one of which was that it was on a contingency which had not happened ; and such decision was sustained by the Supreme Court on the same grounds. It was in that case, as I have already noticed, that the English cases (Egerton v. Matthews, and Saunderson v. Jackson, ubi sup.) cited by the learned judge (Marcy) for his merely incidental remark that the signature of the defendants to the contract was a sufficient compliance with the statute, related to land alone. The late case of Dykers v. Townsend, (24 N. Y. Rep. 57,) is as strong an authority on the other side, as any just given, in regard to the obligation of a contract on a vendor when not signed by him. The learned judge who gave the opinion in that case says : “ As an original question I should have no hesitation in saying in a case where a. contract was entirely executory on both sides and no part of the consideration had been paid, that it was necessary it should be in writing under this statute, and be signed by both parties thereto in order to be binding on either.” It appears to me to be most decidedly a question not yet disposed of by authority, but studiously avoided.

The change of language in the statute from the party by whom an interest in, or lease or sale of lands, is to be made, and the party who is to be charged with the agreement mentioned in the immediately preceding section in the singular, to the parties to be charged, in the plural, in the provision under consideration, is most striking and conclusive. That second section of the statute expressly requires a consideration to be expressed in the agreements therein referred to, (2 R. S. 135,) although a similar requisite was held to he necessary, even without such express requirement. (Sears v. Brink, 3 John. 210.) The provision under consideration does not contain the same requirement, because in a contract of sale the terms, including the price, must be mentioned, and the signature of the purchaser shows the consideration by the instrument itself. If the principle is to prevail as to the purchaser, it must do so equally as to the vendor ; nor will it do to say, as in Roget v. Miller, (ubi supra,) that the delivery of the goods is of more importance than paying their price. And then a mere offer, which is all that an agreement or proposal on one side to buy is, might be converted afterwards by mere parol testimony of its acceptance, into a contract. There is certainly as much danger of perjury in proving by parol, such acceptance as the whole contract. I am satisfied, therefore, that the express terms of the provision under consideration, as well as the purpose of the statute, require that the terms of a contract of sale, after being fixed, should be reduced to writing, and signed by both parties, in order to prevent both misapprehension and perjury.

The judgment and order denying a new trial must, therefore, be affirmed, with costs.

Barbour, J. concurred.

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Dissenting Opinion

McCunn, J.

(dissenting.) In-this case, I regret to say, after having given it a careful and anxious consideration, I am unable to agree with the opinion pronounced at general term. That the defendants are clearly liable under the contract, I have not the shadow of a doubt.

The principal question in the case is, whether the memorandum or contract signed by the defendants is sufficient in law to bind them.

The facts are as follows : The defendants made an agreement with the plaintiff to furnish him with 1000 Enfield rifles, and thereupon entered into a contract, and signed the following memorandum of the same :

“ New York, May 13th, 1861.

We agree to deliver P. S. Justice one thousand Enfield Pattern Rifles (with bayonets, no other extras) in New York, at #18 each, cash upon such delivery, said rifles to be shipped from Liverpool not later than 1st of July, and before if possible.

(Signed)

W. Bailey Lang & Co.”

Which agreement and-memorandum were accepted by the plaintiff. After the contract was entered into, the article increased largely in value, and the defendant neglected and refused to supply the rifles, whereupon this action was brought.

I will remark here, that in looking carefully into all the evidence, I am constrained to the belief that the only reason which influenced the defendants in refusing to perform the contract was that the rifles had nearly doubled in value from the time the contract was made until the time they were to be delivered. .After the testimony was nearly closed, a motion was made to dismiss the complaint, upon the ground that there was no consideration passing in the contract, and “ that the contract was a mere nudum pactumThe motion was granted. Notwithstanding this, I am satisfied, after a careful examination of the statute, and of all the American and English authorities on the subject, there was error in dismissing the complaint. The contract, as stated above, was a full compliance with the requirements of the statute, and upon the facts presented, the plaintiff was entitled to recover. It will be conceded that before the passage of the statute of frauds, a verbal contract between parties for any amount whatever was good. This being so, the statute simply altered the common law in this respect, that it merely requires for greater certainty that a memorandum of the contract should be made in writing.

It is admitted that the form of the memorandum of the contract in this case, so far as words are concerned, is all that is required. The defendants simply contend that there is no mutuality, because the plaintiff did not sign a duplicate of the memorandum. This, in my opinion, was of no consequence.

The defendants and the plaintiff made and entered into the contract; the one agreed to sell at a fixed and certain price, and the other to buy at that price. This was the mutuality, and the consideration expressed was the $18 per rifle. The defendants reduced the contract to writing, or made a note of the same, and signed and handed- it to the plaintiff, who accepted it, and this was all that was required to complete the transaction, and if the defendants did not demand a duplicate of the memorandum signed by the plaintiff, it was their own fault; but without this, the defendants, if they had delivered the rifles, could not recover in an action of assumpsit. (See Gridley v. Gridley, 24 N. Y. Rep. 130.)

The mere acceptance of the note or memorandum, in writing, of the contract by the plaintiff, was enough to bind him, and was sufficient to enable the defendants, in a court of law, to compel a- performance on his part. The law, in all cases, implies a promise to pay where it is the duty of one to pay; and no one will doubt for a moment that if the defendants had made and tendered the rifles, the plaintiff would have been compelled to pay. In the case of Gridley v. Gridley, above cited, Mr. Justice Davies, in one of the most clear and forcible opinions in our books, lays down the principle that where a party accepts a written obligation from another, although he does not subscribe the same, yet in a court of law he can be held responsible for the performance of its conditions, and such was declared to be the rule in the following cases : Spraker v. Van Alstyne, (18 Wend. 200;) McLachlan v. McLachlan, (9 Paige, 534;) Van Orden v. Van Orden, (10 John. 30 ;) Lord v. Lord, (22 John. R. 60.) Indeed, the cases are too numerous to cite, which fully establish this doctrine, and sustain my conclusion.

In construing a statute, it is our duty to ascertain the true legal import of the words used by the legislature, and to collect the intention from the language of the statute itself; but not to make out the intention from some other source of information, and thus interpret the words of the act, so as to meet the assumed intention.

The danger of traveling out of the statute, and looking elsewhere for the object of the legislature, may be illustrated by the wide difference of opinion entertained by the members of this court in the present case. In order to know what a statute does mean, it is one important step to ascertain what it does not mean, and what it forbids must be consistent with what it permits.

Now, the act says : “A note or memorandum of such contract must be made in writing, subscribed by the parties to be charged thereby.” It does not say all the parties to the contract must subscribe the memorandum, and that it must be signed in duplicate ; it simply says subscribed by the parties to be charged with doing the work or furnishing the goods ; in other words, the vendor.

There is a stronger reason than any that has been urged, showing this to be the proper construction of the statute. In 1835, the question came up in the legislature, when other amendments were being made to the old statute of frauds, as to whether the words in the statute, to wit, “ the parties to be charged thereby,” should be amended, so as to include the names of all parties to the contract, and that body rejected the proposed amendment, assigning as a reason that by virtue of the old act and the adjudications thereunder, all the parties to the transaction had a complete remedy without such alterations. (See reviser’s notes. 3 R. S. 656, 2d ed.) It is clear, therefore, that these words must now be taken in their fixed and adjudicated sense, and that they absolutely mean that the statute should be satisfied when the parties to be charged therewith signed the memorandum. And this interpretation is supported in reason and in equity. The contract is binding on both parties, because the promise on the one side to sell at a certain fixed price, and of the other to buy at such price, is the mutual consideration for each other, and the statute only requires that a note or memorandum of the contract must be in writing; it does not say, and does not mean that it shall be signed in duplicate by all the parties to the contract.

Moreover, a party should not be allowed to take advantage of his own neglect in not getting and retaining a copy of the contract.

After the original act was passed, I will show hereafter that a construction was given it, and that construction has been strictly followed to this day. It is the construction that naturally presents itself at once to the mind, and under it, all parties have a perfect remedy.

How, if this be so, and there is not a single authority to the contrary, why unsettle the law at this day, and that to no-purpose, and for no cause. On a careful examination of all the authorities from the time of the passage of the original act, it will be seen that the courts, both in England and America, have uniformly held that when a memorandum of a contract is committed to writing, and signed by the party to be charged thereby, and accepted by the other, this is entirely sufficient.

Precedent serves to illustrate principles, and give them a fixed authority. We must respectfully regard the authorities of prior adjudications, which form in themselves an established rule, and when they violate no principle; We must discriminate the actual grounds of decisions from any casual observations that accompany them, because these observations form no decisive resolution, no adjudication, no professed or deliberate determination. In the case of Davis v. Shields, disposed of in the Court of Errors of this state, in 1841, both the Chancellor and Mr. Senator Verplanck laid down the doctrine “ that the name of the party to be charged therewith was only requisite to the note or memorandum.” Indeed, Senator Yerplanck, in one of the most clear and forcible arguments I have ever had the pleasure of examining, establishes this doctrine beyond a doubt, and this rule was re-renunciated in the Court of Appeals of this state, in the case of Worrall v. Munn, (5 N. Y. Rep. 229,) where Mr. Justice Paige says: “that it is only necessary the memorandum should be signed by the vendor, the party to be charged therewith.” In Dykers v. Townsend, (24 N. Y. Rep. 57,) a side remark of Judge Hoyt, a mere obiter dictum, and not intended as law, is cited as indicating that he entertained a contrary opinion. He says : “ As an original question he would have no hesitation in saying in a case, where a contract is executory, that it was necessary it should be in writing under the statute, and be signed by both parties thereto,” but in another and latter part of his opinion, he takes all this back, and lays down the law after this clear manner.

“ In this case, a note or memorandum of the contract was made in writing, and signed by the defendant, and we think that this was a sufficient compliance with the statute according to the settled construction which has been given to it.” Now, after this candid avowal of the law on that point, it cannot be fairly said the question involved, and now under consideration, did not "come up in that case. It did come up, and was settled by a unanimous bench, and the views I entertain are correct.

The next case our attention is called to is that of Bailey v. Ogden, (3 John. 399,) a case in no way similar to the one at bar. That was a case where the plaintiff, the vendor, made an entry in his own books of the sale, of which entry the defendant, the vendee, knew nothing. But even in that case, Kent, chief justice, lays down the principle “ that it is only necessary for the party to be charged to sign the contract.” The case of Laurenson v. Butler, (1 Schoale & Lefroy, 201,) has no resemblance whatever to the case under discussion. That was a case of a mistaken contract about a lease, and the court held that a performance could not be compelled because there was a mistake as to the power to sell, and the plaintiff knew of the mistake before he accepted the contract'. In the case of Roget and Barrett, I do not agree with the defendant’s counsel in saying that this question was' passed without adjudication. On the contrary, the question came fairly up, and was fully discussed and passed upon, and in my view, that decision settles the law in this case in favor of the plaintiff. In announcing the opinion of the court in that case, Mr. Justice Spencer lays down the rule that only the parties to be charged are required to sign the memorandum, and he remarks that if there are acts to be done by both parties (such as the exchange of commodities to be manufactured,) there is no doubt but that such contract would be obligatory, if signed by one party and accepted by. the other. The case of Clason v. Bailey, fully corroborates the views I entertain in this respect. In that case, the chancellor, in announcing the opinion of the , Court of Errors, cites numerous English and American authorities, all clearly establishing the fact that a memorandum, signed by one party, and accepted by the other, is sufficient under the statute.

In the case of Russell v. Nicholl, (3 Wend. 118,) before referred to, that most learned and able judge, Marcy, lays down a similar doctrine to the one I entertain, and this clear principle can be no better illustrated than by the exposition of that eminent judge.

“ It was insisted,” says Governor Marcy, “ that the contract declared on was, within the statute of frauds, void, for not being reduced to writing, and signed as the statute directs. This objection is not sustainable. It is very clear that the signing by the defendants is a compliance with the statute.”

The case of Chater v. Beckett, (7 Term Rep. 203,) is not at all a case in point. The agreement in that case was by parol. It is true, however, that some remarks were made by Lord Kenyon, not only not bearing on this case, but entirely foreign to the record, and which decide nothing. The last, and only remaining case cited by counsel for the defendant is that of Ballard v. Walker, (3 John. Ca. 60,) which confirms my views in this case.

The question under consideration should not demand of me so much care and attention, especially since we find two cases in this very court, precisely similar, where similar memoranda were sued upon, and- where this court were unanimous in sustainiqg the old and well established rule, that it was only necessary for the parties to be charged thereby to sign the memorandum. I refer to Fenley v. Stewart, (5 Sandf. 101;) and also to the case of West v. Newton, (1 Duer, 277.) The memorandum in the first case was as follows :

“ For a valuable consideration to us in hand paid, we have sold A. H. Fenly two thousand five hundred bushels of canal oats, at forty-five cents per bushel of thirty two quarts ; to be delivered in this city at any time, at our option, between the 1st and 15th of June next ; to be cash on delivery.

New York, April 23,1847.

A. W. Otis & Co.”

The presiding justice, delivering the unanimous opinion of the court, employs this language :.

“ The statute of frauds requires not that the contract should be signed by both parties, but the parties to be charged thereby; and the uniform construction has been that the signature by the defendants alone, that is, by the parties sought to be charged, is sufficient to sustain the action. This construction has proceeded, not on the ground that contracts need not be mutual, but that the statute in certain enumerated cases has taken away the power of enforcing contracts, which would otherwise be mutually binding, unless the parties against whom they are sought to be enforced have subscribed some note or memorandum thereof in writing.” * * * It necessarily follows, however, from the provision of the statute, that all inquiry as to whether or not a contract was originally mutual is immaterial. It may be enforced against the party who has subscribed a note or memorandum of it, though the other party, by not having signed, is by the express words of the statute freed from its obligation. The objection, therefore, of want of mutuality is not well taken.

In the case of West v. Newton, (1 Duer, 277,) the following contract was sued on :

“ I do hereby agree to deliver to J. Selby West, at such places as he shall direct, during the months of August, September and October next, in about equal quantities each month, five hundred tons of egg end five hundred tons of good size stove coal, best quality of red ash, peach orchard, at five dollars per ton, cash, or interest added, after delivery, as he shall prefer ; the above coal to be in good order and gross tons, credit not to be over three months.

Morris Buckman.

Mew York, April 16,1846.

Agent for Jacob Carrigan, Jr.”

The presiding justice in delivering the unanimous opinion of the court says : “ The objection that the memorandum was insufficient under the statute, we incline to think is not well taken. The contract is not a mere proposal, but is mutual on its face, since the price stipulated to be paid for the coal is a sufficient consideration for the promise to deliver it.”

Mow can there be two cases more in point than these, especially when we find the contracts and the facts precisely the same as in this case, and they do not, unreversed as they are, settle the law so far as this court is concerned ; especially, when we remember that at that day the court was honored by the presence of an Oakley, a Duer and a Sandford, and when we consider the further fact that the only lights or adjudications the court have now to guide them in their deliberations .are precisely the same lights and the same adjudications the judges of that day enjoyed.

The judgment of dismissal should be reversed and a new trial ordered, with costs.

Judgment and order affirmed.