179 Iowa 563 | Iowa | 1916
Lead Opinion
“It may be stated as universally true that fraud vitiates all contracts, but as a general thing it is not presumed but must be proAred by the party seeking to relieve himself from
See Zimmerman v. Bitner, (Md.) 28 Atl. 820; Dawson v. National Life Ins. Co., 176 Iowa 362.
“Gifts, however, are valid without consideration or actual value paid in return. But there must he delivery of possession. The contract must have been executed. The thing given must be put into the hands of the donee or placed within his power by delivery of the means of obtaining it. The gift of the maker’s own note is the delivery of a promise only, and not of the thing promised, and the gift therefore fails. Without delivery, the transaction is not valid as an executed gift; and without consideration it is not valid as a contract to be executed.”
The subject was fully considered by Chief Justice Shaw in Parish v. Stone, 14 Pick. (Mass.) 198:
“It has therefore been the established rule of law, that, in a suit upon a promissory note, against the promisor by the promisee, or by an indorsee, without value given, of taking the note under such circumstances as to enable him to stand only upon the rights of the promisee, it is competent for the promisor to show by way of defence, that the promise was gratuitous, and was made without any legal consideration. * * Such being the clear rule of law, it follows that a contract to pay money, founded upon no other consideration than that of equalizing the distribution of one’s estate, after his decease, is merely gratuitous; it is nudum pactum, given upon no sufficient legal consideration, and therefore cannot support an action or found a legal claim. The rule being clear and well settled by authorities, it is not necessary to support it by a reference to the principle upon which it is founded. But as it appears sometimes to operate harshly and to defeat the intentions of those who have a right to dispose of property as they please, it may afford some satisfaction to consider the importance of making and preserving a broad distinction between the claims of
And later on, with reference to donatio causa mortis:
“We think the donor’s own promissory note payable to the donee, could not be the subject of such a donation. It was not an existing available promissory note ’to anyone; it was not a chose in action. We have already seen that it was not a binding contract by the promisor to the
The note executed by decedent, if gratuitous, was a mei’e promise to give money at a future time. He might, if living, have defended on the ground that it was- without consideration, and since he is dead, his representatives may interpose the same defense. He did not deliver the money promised before death, and, as there was no actual delivery of gift, if such it was, before his death, the note, if gratuitous, cannot be enforced. In so far as anything said in Harman v. Harman, 167 Iowa 106, is in conflict herewith, that case must be regarded as overruled.
“As the doctrine now prevails, something more than a mere moral obligation is necessary to create a good foundation for an action between the parties thereto. There must be a consideration esteemed valuable at- law, before an express promise can create or revive a legal liability. In Story on Promissory Notes, Sec. 185, we are expressly informed that ‘a mere moral obligation, although coupled with an express promise, is not a sufficient consideration to support a note between the same parties.’ ”
“It is quite generally held that a mere moral. obligation is not sufficient consideration to support a subsequent promise.”
Some of the early English cases lend support to the proposition that a moral obligation is sufficient support for an express promise. See Atkins v. Hill, 1 Cowp. 284; Atkins v. Banwell, 2 East 505. This view seems to have been first challenged and overthrown in a note to Wennall v. Adney, 3 Bos. & P. 247, 252, where many decisions are reviewed, and the doctrine laid down, generally followed since, that:
“An express promise, therefore, as it should seem, can only revive a precedent good consideration, which might have been enforced at law through the medium of an implied promise, had it not been suspended by some positive rule of law, but can give no original right of action if the obligation on which it is founded never could have been enforced at law, though not barred by any legal maxim or statute provision.”
In Kenan v. Holloway, 16 Ala. 53 (50 Am. D. 162), the court observed that the law cannot undertake to enforce every promise which a man of honor and dignity would feel himself bound to perform; and, in Cook v. Bradley, 7 Conn. 57 (18 Am. D. 79), doubt is expressed whether any case is to be found in the books where a moral obligation alone was held sufficient consideration for an express promise. See also, as holding a moral obligation only an insufficient consideration, Schnell v. Nell, 17 Ind. 29 (79 Am. D. 453), Farnham v. O’Brien, 22 Me. 475, Mills v. Wyman, 3 Pick. (Mass.) 207, where it is said there must be some pre-existing obligation which has become inoperative by positive law, to form an effective promise. Hendricks v. Robinson, 56 Miss. 694 (31 Am. R. 382); Shepard v. Rhodes, 7 R. I. 470
6' consiaoration: ofsorvioos? bolwsoni Iwt-Isfaction only. Without further citation,-it is enough to say that this is now the doctrine obtaining in England and nearly all the courts of this country, though occasionally criticised, as in Ferguson v. Harris, 39 S. C. 323 (17 S. E. 782). This doctrine was applied in Allen v. Bryson, 67 Iowa 591, in holding that services gratuitously rendered will not support a promise to pay therefor. The same rule prevailed where a father promised to pay for the services of a daughter, who had attained majority, previously rendered as member of his family. See also Chadwick v. Devore, 69 Iowa 637; Van Sandt v. Cramer, 60 Iowa 424. Nor is a subsequent promise to do something not required by a previous contract, without a new consideration, binding. Handrahan v. O’Regan, 45 Iowa 298. The doing of that which a party is already undcr contractual obligation to do, will not - . support a further promise to pay an addi-
tional price. Ayres v. Chicago, R. I. & P. R. Co., 52 Iowa 478; Runkle v. Kettering, 127 Iowa 6. In Stilk v. Myrick, 2 Campb. 317, Lord Ellenborough held that an agreement to pay seamen extra for what they were bound by their articles to do was void; and a like ruling was made in Bartlett v. Wyman, 14 Johns. (N. Y.) 260, where a master agreed to give more wages if the seamen would not abandon the ship. In Davis & Co. v. Morgan, (Ga.) 61 L. R. A. 148, defendant had engaged to work for plaintiff a year at $40 per month. Some time after he had begun work, he was offered $65 per month by a company in Florida, and claimed that, on advising his employer of this, he was promised $10 per month additional compensation. This promise was held to have been without consideration. The cases are collected in 1 Elliott on Contracts, Sec. 211 et seq. The principle controlling these cases necessarily leads to the conclusion
In Bentley v. Lavib, 112 Pa. St. 180 (56 Am. R. 330), there was no showing that the compensation had been in full for services rendered, and therefore the promise to pay an additional amount could not be said to have been without consideration. See Appeal of Clark, (Conn.) 19 Atl. 332. In Barthe v. Succession of Lacroix, 29 La. Ann. 326 (29 Am. R. 330), however, the claimant had worked for decedent for low wages, which had been paid, and a note to make up what the maker deemed the inadequacy was held to be with consideration, the court saying :
“The conclusion Ave have reached is that the deceased, Lacroix, being Avithout family, and believing that plaintiff had served him long and faithfully at very small wages, felt that he Avas under a moral obligation to remunerate him beyond his wages, and executed this five-hundred-dollar note for that purpose. In one sense it was a gratuity; i. e., he was under no legal obligation to do so. In another sense it was the fulfillment of a natural obligation. We think that there was a good and valid consideration for the note.”
In other words, the court declared the moral obligation a sufficient consideration. To that, as seen, we could not subscribe without repudiating former decisions. Anything less than a legal obligation, as defined in Wennall v. Adney, supra, cannot be regarded as a sufficient consideration. In the case at bar, the evidence tended to show that claimant engaged to. render services required of her for the compensation actually paid, for which she receipted in full. A promise to pay an additional sum, therefore, was as much without consideration as the agreement to pay more than the contract price, in Ayres v. Chicago, R. I. & P. R. Co., supra. That her compensation may have been inadequate can
Furst, "who visited him frequently, but not as a physician, when told by him what he was paying claimant, suggested that it was not enough, and he responded that “he knew it wasn’t, and was going to provide for her in another way.” «
Mills testified that, in response to the statement by him that if he kept her up all night he ought to pay double wages, he said: “I realize that Cora is not receiving as much as she ought to,” and that this had been so for some time; and added, “I have fixed that now so that she will be properly paid in the near future;” and explained that he had no ready money, but had property in the east, which he expected to turn into cash; and that, in the meantime, he had given claimant a note of $5,000, which he intended to pay as soon as he could turn some of his property into cash; and that the note had been given probably two weeks prior to that time. This is said to have occurred July 3d prior to his death.
Elizabeth Spurgeon testified to having a conversation with him, in which he proposed building claimant a house, saying that “he did not pay her enough money,” and that they would live in the house and when he was gone she would have it for a home, to pay her for lack of wages; and
From the circumstances that claimant entered into a written contract specifying the precise sum she should be paid monthly until May, 1909, and receipted for such sum as salary in full each month up to the time of decedent’s death, and' for the last month thereafter, a strong inference arose that she had received all that was owing her, but such inference, as said, is not conclusive. Notwithstanding this, it was open to her to show that she was induced to continue in his employment on a mutual understanding that these payments were present satisfaction for such wages as she Avas to receive in money, and that he would, later on, make up and pay in some manner for the difference between what he was giving her and the real value of her services rendered subsequent to such understanding. Of course, until there was such an understanding, if any there was, she had no claim against the estate. Services rendered subsequent to such an understanding, and in pursuance thereof, would constitute a valuable consideration for a promise to pay hex', such as contained in the note given her. It Avas for the jux’y to say whether the note was made
■ In view of another trial, it should be added that the seventh instruction may well be more explicit as to the showing of good faith and fair dealing exacted from the claimant if her relation be found to have been fiduciary. Also, it may be well to explain to the jury that the receipts indicated on their face that claimant had been fully paid all wages owing her; and that, if she claimed otherwise, the burden was on her to show that she rendered services in pursuance of some understanding that she was to be paid a sum additional thereto. The tenth instruction might veil be made more explicit by telling the jury that, if there was an understanding that she should be paid a sum in addition to the monthly wage, and the note was executed to pay for services rendered in pursuance thereof and thereafter to be rendered, this would be a sufficient consideration, even though he may have been mindful of past inadequacy of compensation in fixing the amount. Because of the errors pointed out, the judgment is — Reversed.
Concurrence Opinion
=1 concur in the result announced in the foregoing opinion, but cannot agree to the correctness of the discussion there indulged in upon the general subject