Opinion by
In 1921, Maurice Leberman, and his brother, now deceased, represented in this proceeding by his executor, bought and sold French francs for Ross, the plaintiff, and, by reason of these transactions, became indebted to him for $36,512.50. In the suit brought to recover this amount in 1928, liability arising from the transaction mentioned was admitted, but a counterclaim was presented based on certain expenditures made on behalf of Ross for insurance premiums, and, in a subsequent pleading, plaintiff agreed this sum should be deducted from his demand. We are not therefore concerned in this case with that item. To the balance of the counterclaim, which causes the present dispute, a reply in the nature of a demurrer was filed to defendants’ statеment, and judgment also asked for want of a sufficient affidavit of defense to the original demand. The second request was granted by the trial court, and the correctness of its conclusion is the subject of complaint in the present apрeal. In passing upon its action, it must be kept in mind that doubts arising, if any, are to be resolved in favor of the parties against whom the court has decided on the pleadings alone: Rhodes v. Terheyden,
Defendant averred, as a set-off to thе admitted indebtedness, a demand for expenditures made at the request and on behalf of the plaintiff. Paragraph 16 of the counterclaim asserts Ross requested that the balance due as the result of the transaction in foreign exchange in 1921 should be so applied in a designated way, and that this was in fact done. It appeared that the *577 three parties here involved, and another, were equal owners of the capital stock of Edgar & Company, in which each had large financial interests. Its operation required the use of considerable sums to carry on its corporate business, and all interested had furnished certain amounts prior to 1923. In January of that year it became apparent that additional advances were necessary, and Ross, who had then moved his residence to London, verbally agreed with the Lebermans to pay one-third of the amount required to keep the concern a going-one, the fourth stockholder being unable to give financial assistance. It was stipulated that plaintiff would pay a one-third share of the extra funds required, the balance at the time due by defendants to him to be used to cover his portion in so far as necessary, in case the defendants individually raised the remaining two-thirds which might be expended. In pursuance of this agreement, the latter made outlays for Edgar & Company until 1926, amounting to $105,769.33. One-third of this amount exceeded the indebtedness due Ross, which he stipulated should be sо applied. It was therefore claimed that the set-off was greater than the debt sued for, and no judgment for plaintiff could be entered. The statements above recited are those sworn to, and, for present purposes, are tаken as accurately representing the situation.
In support of the right to summary judgment, plaintiff urged the insufficiency of the counterclaim, in that it failed to aver that notice was given by the Lebermans of the acceptance of the оffer of Ross made in 1923, and the contract was therefore unenforceable. The promise in this case was not to pay third parties sums which might be borrowed by the Lebermans, as in the ordixiary case of guaranty, nor was there a contingent liability to pay, but an understanding to underwrite one-third of the advances made for the corporation, in which Ross was interested. The necessary amounts were directed to be taken from the balance then due by the *578 Lebermans, provided the defendants should supply the remaining two-thirds, which they claim to have expended between 1923 and 1926. No notice of the outlays made was furnished directly to Boss, nor did he ask to be advised as to the amount. As a one-fourth owner of the stock of the corporation it would seem he was in position to secure the information if desired. No revocation of his undertaking appeared.
The argument is made that the contract set up was unilateral in nature, and therefore without еffect, unless a notice of acceptance was given, which fact is not averred, but the act agreed upon as a condition of liability was performed without revocation, and that is sufficient to bind the offeror. “It is often said that notice of acceptance is necessary for the completion of a contract, but it is not true and never has been true, as a general proposition, that, where an offeror requests an act in return for his promise, and the act is performed, notice to the offeror of the performance is necessary to create a contract”: 1 Williston on Contracts 117. This rule has been generally recognized, and finds ample support in our decisions: Snydеr v. McGill,
It is further to be noticed that the offer and promise to reimburse was contemporaneous with the understanding that advances were to be made, аnd was not a liability to be contingent upon the making of some new contract with a third party, for the performance of
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which the offeror agreed to become responsible. This is a difference recognized in Cumberland Glass Co. v. Wheаton,
The opinion of the court in this case shows that summary judgment was entered not because of lack of notice of acceptance of the offer, before revocation, but for failure to inform Ross when the actual expenditures were made, which it held was required if the counterclaim was to be sustained. In support of this proposition, 13 C. J. 284, and 1 Williston on Contracts 118 are cited. It will be noted that the authority first relied оn is based upon but one American decision, Bascom v. Smith,
An attempt has been made to fоrmulate a rule by the American Law Institute in section 56, already referred to, when it states: “But if the offeror has no adequate means of ascertaining with reasonable promptness and certainty that the act or forbearance hаs been given, and the offeree should know this, the contract is discharged unless, within a reasonable time after performance of the act or forbearance, the offeree exercises reasonable diligence to nоtify the offeror thereof.” But, as there said by the authors, “It is only in the exceptional case where the offeror has no convenient means of ascertaining whether the requested act has been done that notice is requisite. Even then, it is not the notice which creates the contract, but lack of the notice which ends the duty.”
The principle would seem to be properly stated in Hare on Contracts, page 332: “When, what the promisor stipulates for is performance, the contract is complete as soon as the act is done, whether it be or be not known or communicated to the promisor. If the circumstances are such that he cannot inform himself by
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inquiry, it may be requisite to give Mm notice; but tMs is a сondition subsequent that will annul tbe contract if unfulfilled, and not a step that must be taken to call it into being.” It is not tbe notice wbicb creates tbe contract, but a lack of it may constitute an excuse from liability. If tbis is so, then tbe agreement is enforсeable, unless tbe promisor can establish that for some reason be is relieved from performance. If tbis arises from failure to give notice at tbe time advances were made, and be was therefore misled and prejudiced, nоt having the power to learn tbe true facts by inquiry, tbis is a matter of defense, and must be averred in answer to tbe counterclaim filed, which is on its face sufficient. Tbe defendants, while making claim as a set-off, were not bound to aver facts wbicb would show the existence of matters properly of defense to tbe counterdemand made: 31 Cyc. 109; Harper v. Lukens,
Boss bad agreed that advances should be made to Edgar & Co., in the success of whose business be was interested, and stipulated that tbe balance owing him should be used by tbe Lebermans, provided they furnished twice tbe sum wbicb be agreed to pay. Tbis they did, without receiving notice of revocation of their authority to so act. If Boss was deceived as to tbe extent of payments being made, or be was unable, after due inquiry, though owning one-fourth of tbe stock of tbe company, to find tbe amount being expended under bis agreement, tbis may be considered in way of defense, but if be desires to take advantage of such facts, be must assert and prove them. It follows from what has been said that a summary judgment should not have been granted in tbis case, but an opportunity given to Ross to set up the excuse for nonpayment by proper pleading, and to *582 establish on trial any essential matters constituting a release from liability under the agreement which he made.
The judgment is reversed and a procedendo awarded.