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Montgomery H. (Montgomery Hunt) Throop.

A treatise on the validity of verbal agreements, as affected by the legislative enactments in England and the United States, commonly called the Statute of frauds (Volume 1) online

. (page 1 of 74)
Online LibraryMontgomery H. (Montgomery Hunt) ThroopA treatise on the validity of verbal agreements, as affected by the legislative enactments in England and the United States, commonly called the Statute of frauds (Volume 1) → online text (page 1 of 74)
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A TREATISE



yaliiity of Terlal Aireemeiits,



AS A^rXOTED BT THE LEOISLATITE ENAOTSIENTS



m ENGLAND AND THE UNITED STATES,



COUUONLT CALLED



THE STATUTE OF FRAUDS;



INCLCTDINO, ALSO, THE EFFECT OF PARTIAL AND COMPLETE PERFORMANCE, AND

THE SUFFICIENCY OF THE WRITING, IN CASES WHERE VERBAL

AGREEMENTS ARE NOT VALID ;

TOGETHER WITH OTHER KINDRED MATTERS; TO WHICH ARE PREFIXED TRANS-
CRIPTS OF THE VARIOUS STATUTES ON THE SUBJECT, NOW IN
FORCE IN BOTH COUNTRIES.



BY MONTGOMERY H. THROOP.



rN" x-wo voLXJ]ytKS.

YOL. I.



ALBANY, N. Y.

JOHN D. PARSONS, Jr., PUBLISHER

1870.



2^n^M



r



Entered, according to act of Congress, in the year Eighteen Hundred and Seventy, by

MONTGOMERY»H. THROOP,

in the Office of the Librarian of Congress, at Washington.



WHED, PARSONS AND COMPANT,

PllINTERS AND STEREOTTPERS,

ALBANY, NEW YORK.



PKEFACE.



The uncertainty and confusion, which, after the lapse of nearly
two centuries, still obscure most questions pertaining to the appli-
cation of the statute of frauds to executory agreements, have long
been a reproach to our system of jurisprudence, a stumbling block
to the student, and a source of painful embarrassment to all per-
sons charged with the administration of justice. In the following
pages I have endeavored to reduce the discordant mass of doctrine
and authority upon this branch of the law, to an orderly and har-
monious system. The difficulties attending this undertaking are
well known to all who have studied the subject ; and although I
cannot expect complete success, I hope for the good will of the
profession towards my effort to accomplish an object so desirable,
and its kindly indulgence wherever I may have failed. And I cher-
ish with considerable confidence the belief, that this work, regarded
merely as a collation of cases and principles, many of which are
imperfectly understood, and inaccessible without much toil, will
tend materially to lighten the labors of my professional brethren
in similar investigations, and to smooth the path of the student ;
even if the methods which I have freely, (perhaps sometimes pre-
sumptuously,) suggested, of reconciling cases supposed to be
conflicting, and of terminating the conflict of authority when they
could not be reconciled, shall fail to command general approbation.

The nature of my task has often required more elaborate dis-
''ussions of principles, more minute examinations of the peculiar
features of the adjudged cases, and more extended comments upon
them, than would be necessary or proper, in writing upon sub-
jects where the governing rules are more settled, and the authorities
more harmonious. For this reason, and particularly in conse-



IV PREFACE.

quence of the manner in which I have cited leading and represent-
ative cases, I have found it impossible to complete this treatise in
one volume, as I had originally proposed. But, unless I misappre-
hend the preferences of the profession, few will complain of an
increase of bulk, caused by accurate condensations of judiciously
selected authorities. The number of the volumes of the reports,
to which an American lawyer is now referred by the digests, is so
great, that a personal examination of all the adjudications, upon
any obscure and controverted point of law, can rarely be made, ex-
cept in a public library ; and access to such an institution can be
obtained by many of the profession only at intervals, while it is
attended with great delays and inconveniences, even to those who
can command it at pleasure. The plan, which has been adopted
by some of the most popular legal authors, of giving abstracts,
more or less extended, of the principal cases cited, although but
a partial remedy for this evil, is the only one of which it admits.
And I have therefore used such abstracts freely, in order to eluci-
date the practical operation of settled principles ; to point out the
distinctions in their application; to show the arguments and
authorities upon each side of unsettled questions ; to fortify my
own conclusions ; and generally to illustrate the current discus-
sion. No pains have been spared to overcome the difficulty,
inseparable from the necessary condensation, of making them
faithful exponents of the reported cases. And although nothing
can entirely supply the place of the reports themselves, it is be-
lieved that these abstracts will greatly assist the ready understanding
of the text, and answer many useful purposes, not only in the
" occasions sudden " of professional practice, but also in the delib-
erate preparation of causes for trial or argument.

In condensing the English decisions, I have consulted all the
different reports of the same case, (frequently five or six in num-
ber,) selecting in each instance the most satisfactory version, and
sometimes gathering the points of the case from more than one
report. The book from which the condensation was made, is



PREFACE. V

always mentioned in immediate connection with the title of the
case ; and when several books were used for the purpose, all are
similarly cited. The parallel reports are referred to in the foot
notes ; or, when the principal citation is in a foot note, they are
inserted in brackets.

There is a very close connection, in many instances, between
questions relating to the sufficiency of certain agreements under
the statute of frauds, and questions affecting their validity at com-
mon law, or the right to enforce them in equity. This connection
has frequently led to confusion ; but even where the dividing line
has been preserved, or after it has been pointed out, a rigid restric-
tion of the discussion to the questions arising under the siatute,
would often leave the examination of the subject incomplete, and
its result unsatisfiictory. For this reason many common law and
equitable doctrines, pertaining to the general law of contracts,
have been incidentally considered in the course of these pages,
sometimes at considerable length ; the discussion having been
thrown into a foot note, whenever it threatened to encroach too
much upon the space and attention, to which the principal subject
was justly entitled to lay claim.

M. H. T

N EW YOEK, Jidy, 1870.



TABLE OF CONTENTS.



Statutes relating to the Subject of this "Woek, 31



Introductory Chapter.

General survey of tlie statute of frauds, especially those parts of it which
relate to executory contracts, 67

Akticle I. Object, origin, history and effect of the statute; different
opinions which have prevailed relative to the spirit in which it should
be construed ; effect of such opinions \ipon the rules determining the
application of the fourth and seventeenth sections, 67

Abticle II. The statute superadds the necessity of a writing, to the com-
mon law requirement that every contract must be founded upon a
suflacient consideration, 79



PART FIEST.

Op special promises op executors and administrators to answer

DAMAGES out OP THEIR OWN ESTATES, 85



Chapter J^'irst.

Consideration of the first clause of the fourth section of the statute, 87

Article I. Points of similarity and dissimilarity between cases arising
under the first and second clauses respectively ; whether this clause
applies to promises made before the grant of letters 87

Article II. When a general promise by an executor or administrator,
to pay a debt of the deceased, is without the statute, because u is not
to be fulfilled " out of his own estate," 98

Article III. When tliis clause of the statute does not apply, because the
subject matter or the form of the promise docs not answer the stat-
utory description of the liabilities embraced within it, Ill



CONTENTS,



PAET SECOND.

Of special promises to answer for the debt, default, or miscab-

KIAGES of another PERSON, 129



Chapter Second.

Observations introductory to the consideration of the second clause of
the fourth section of the statute, 131

Article I. Explanation of the terms used in treating this subject, 131

Article II. How far the consideration of a verbal promise affects its
validity, 135

Article III. General classification of cases, apparently or actually within
the terms of this clause of the statute, where verbal promises are
nevertheless valid, 148

Article IV. Rules by which to determine the validity of verbal prom-
ises under this clause of the statute, 153



FIRST GENERAL DIVISION.

Cases which are not governed by this clause of the statute of frauds,
although they fall within its terms, 158



Chapter Third.

Cases governed by the law merchant, or the provisions of some other
statute, 159

Rule First.
Contracts, the construction, validity, and evidence of which depend upon
so much of the law merchant, as the common law recognizes, or the
provisions of some other statute, are exceptions to the operation of
this clause of the statute of frauds, 159

Akticle I. Contracts governed by the law merchant, 159

Article II. Contracts governed by the provisions of some other statute, IGl



CO:: TEXTS.



SECOND GENERAL DIVISION.

Cases which are not witliin tliis clause of the statute, because the terms
of tlie statutory description of the promises to which it applies, are
only partially satisfied, 164



Chaptek Fourth.

Cases depending upon the words, " any special promise to answer," 160

Rule Second.

The statute does not apply to implied promises ; or to liabilities for deceit-
ful representations, whereby the third person gained credit ; or to
l)romises to do some act for the security of a creditor of a third per-
son, other than the absolute or contingent assumption of the debt by
the promisor, 166

Article I. Where the promise was not " special," 166

Article II. Where a liability for a third person's debt or default arises
out of a deceitful representation, and not out of a " promise," 171

Article III. Where a promise has been made, to do some act, tending to
the discharge of a liability of a third person to the promisee, but not
directly " to answer for " the same, 183



Chapter Fifth.

General observations upon the cases depending upon the words " debt,
default, or miscarriages," 191

Article I. Meaning and effect of these words, as used in this clause of
the statute, 191

Article II. The statute does not api)ly, unless the promisor and the
third person became concurrently liable for the same debt, default,
or miscarriage, 195



Chapter Sixth.

Cases which are not. within the statute, because the third person had
incurred no liability corresponding with that of the promisor, at the
time when tlic promise took effect, 209



6 CONTENTS,

link Third.
Where there was no antecedent liability of the third person, and the
promise was founded ui)on a consideration moving to him, it is with-
out tlie statute, if the third person did not become liable to the prom-
isee, together with the promisor; and vice versa, if he did so become
liable, it is within the statute, 209

Article I. Origin of the rule ; English cases from which it is derived,. . . 211 "''

Article II. "Where the consideration consisted of money, property or
services, furnished to the third person at his request, but he made no
express promise to pay for them, the test of the promisor's liability
is whether any credit was given to the third person, 216

Article III. English cases upon the question of credit to the third

person, 219

Article IV. American cases, establishing and illustrating the general

rule, and upon the question of credit to the third person, 228

Article V. How far the question, whether the promise was original or

collateral, belongs to the jury, 241

Article VI. Materiality of entries in the promisee's books, and of other

acts to which the promisor was not a party, 248



Chaptek Seventh.

The same subject continued. Application of the third rule to cases, where
the promise in terms contemplated a resort by the promisee to the
third person, 254

Article I. Where the promisor's liability was expressly made conditional
upon non-payment by the third person, 254

1) Where the promise was to pay, if the third person did not, 254

(2) Where the promise was to see the promisee paid, or words to that
effect, 255

Article II. Where the promise is collateral, because its language implied
that the third person was also to become liable, 261

(1) Miscellaneous cases, depending upon the use of particular words,. . . . 261

(2) Where the promise was to become a party to a note or bill of exchange

to be made by the third person, 263

Article III. Where a promise is not within the statute, although it was
in terms conditional upon non-payment by a third person, 273



Chapter Eighth.

The same subject continued. Cases where the interposition of other legal
principles has been supposed to create exceptions to or qualifications
of the third rule, , , , , , 283



CONTENTS. 7

Article I. Where the person benefited by the transaction, and the per-
son who came in aid of his credit, assumed a joint liability to the
promisee, 283

Article II. Where the person benefited and the auxiliary promisor
undertook concurrently to respond ; but the person benefited was
either a married woman or an infant, 299

(1) Observations applicable to either species of auxiliary promise, 299

(2) Where the promise was auxiliary to that of a married woman, 303

(3) Where the promise was auxiliary to that of an infant, 308



Chapter Ninth.

Cases which are not within the statute, although the third person and the
promisor became liable for the same debt, because they were not so lia-
ble at the same time. The subject commenced with those cases, where
the extinguishment of the third person's liability resulted from some
actor omission of the promisee, other than an express discharge,. . . . 318

Itule Fourth.

A promise to assume an antecedent liability of a third person is without
the statute, if the third person's liability had become extinct, at the
time when that of the promisor came into existence, 318

Article I. Origin and correct definition of the rule ; in what cases an
executory agreement to discharge the third person, or to do some act
which will operate to discharge him will satisfy it, 319

Article II. Where the discharge of the third person's debt arose by
operation of law, in consequence of some act or omission of the
promisee, without his express assent thereto, 324

(1) Where the promisee discharged the third person from arrest under a

capias ad satisfaciendum, 324

(2) Where the promisee discharged a levy upon the third person's goods,

which had been made under a fieri facias or a distress warrant, 331

Article III. Where an abandonment of tlic third person's liability is
inferred, as matter of fact, from .some act or omission of the promisee,
without any agreement to that effect, 337

(1) General principles, upon which the application of the statute to this

description of cases is determined, 337

(2) How far the question is material, in this description of cases,

whether the promisor received the benefit of the consideration for
his promise, 3t7

(3) Cases where the new promise was in terms an assumption of the

liability of the original contractor, 353



CONTENTS.



Chapter Tenth.

The same subject continued. Cases where the extinguishment of the
tliird person's liability was effected by an agreement, to which he, the
promisor, and the promisee were parties, 358

Article I. The doctrine of novation, 358

Article II. Where, by consent of all the parties, the third person's antece-
dent liability to the promisee was discharged, in consideration of the
promisor's engagement to pay to the promisee a debt antecedently
due by him to the third person, 360

Article III. Where the third person's antecedent liabilitj^ to the prom-
isee was discharged, in consideration of its assumption by the
promisor, 370

(1) Cases illustrating the general principle, and the rule that the three

persons in interest must concur, 371

(2) Where the third person and the new promisor assumed a joint liability,

in discharge of a previous liability of the third person only, 382



Chaptee Eleventh.

Cases depending upon the words " another person." The subject com-
menced with those illustrating the general proposition, that, in order
to bring the promise within the statute, it must have been made to
the creditor, 386

Bule Fifth.

A promise to discharge the debt or duty of another is not within the
statute, unless it was made to the person to whom the debt or duty
was to be discharged, 388

Article I. Origin of the rule. How it is reconciled with the language
of the clause under consideration, 388

Article II. Cases where the promise was not made to the creditor ;
where it did not relate to a liability thereafter to be incurred by the
promisee ; and where the promisee was the plaintiff in the action to
enforce it, 390



Chapter Twelfth.

The same subject continued. Cases where a creditor seeks to enforce a
contract between his debtor and another person, providing for the
payment of the debt by the latter, 407



CONTENTS. 9

Article I. The question arising under the statute, stated and examined
upon principle ; the English rule with respect to the creditor's right
to sue 407

Article II. American cases, holding that the statute docs not apply to

the action, 420

Article III. American cases, holding that the statute applies to the
action, 448



Chapter Thirteenth.

The same subject continued. The rule with respect to contracts of
indemnity against liabilities thereafter to be incurred by the promisee, 453

Article I. Where the promise was to indemnify the promisee against a
liability to be incurred by him alone, without the intervention of any
third person, 453

Article II. Where the promise was to indemnifj'^ the promisee against
a liability to be incurred by him, at the request of the promisor only,
but as security for the fulfilment of a third person's engagement to a
fourth, 459



THIRD GENERAL DIVISION.

Cases which are not within this clause of the statute, although all the
terms of the statutory description of the promises to which it applies
are literally satisfied, because they are not within its spirit and
intent 488



Chapter Fourteenth,

Cases where, at the time of the promise, the promisor was already liable
for the debt or duty assumed by him, or a similar one, in some other
form, or to some person other than the promisee ; or where he had
previously been liable therefor, and had been only technically dis-
charged, 490

TtuU Sicrth.

A promise is without the statute, if its effect was merely to remove .^ome
impediment to the enforcement, by the promisee, of a liability already
resting upon the promisor, in the same or some other form ; although
its fulfilment will necessarily result in the discharge of the precedent
liability of a third person to the promisee 490



10 CONTENTS.

Article I. Where the promise contained an admissiorn of liability on the
part of the promisor, as a primary debtor ; but another person was in
fact liable, either exclusively or with him, for the same debt or
duty, 491

A}{.TicLE II. Where the effect of the promise was to alter the form of a
previously existing liability, 496

Article III. Where the effect of the promise was to waive a legal de-
fence, against an action founded upon a previous engagement of the
promisor, 501

Article IV. Where the promise was to pay the promisor's debt to a
transferee thereof, in order to discharge a debt due by the transferor
to the promisee, 510



Chapter Fifteenth.

Cases where a promise to pay a third person's pre-existing debt is not
within the statute, because it was substantially to be fulfilled out of
the means of the debtor 519

Rule Seventh.

A promise to pay the pre-existing debt of a third person to the promisee,
is not within the statute, if the substantial effect of its fulfilment
will be to discharge the debt, out of a fund furnished to the promisor
by the debtor, in contemplation of which the promise was made, . . . 528

Article I. Origin and effect of the rule ; English cases recognizing the
principle which it embodies, 528

Article II. Where the promisor, having the fund in hand, undertook to
pay a debt due to the promisee, from the person who furnished the
fund, 534

Article III. Where the reception of the fund, and the making of the
promise, were parts of an agreement, to which the creditor, the orig-
inal debtor and the promisor were parties, 547

Article IV. Whether, if the fund proves to be insufficient to discharge
the promise, the promisor can ever be made liable for the excess of
the debt 558



Chapter Sixteenth.

Cases where a promise to pay a third person's debt is not within the stat-
ute, because the property of the promisor was then subject to a lien
or charge for the payment of the same debt, 504



CONTENTS. 11

Rule Eighth.
A promise to pay the debt of another is not within the statute, if its con-
sideration was the abandonment to the promisor of a security for the
payment of the debt, consisting of a lien ujion, or interest in proper-
ty, to which the promisor then had a subordinate title, 565

Abticle I. English decisions upon the subject matter of this rule, and
also involving the questions to be discussed hereafter in this connec-
tion 566

Abticle II. American cases wherein the rule is established, and its appli-
cation illustrated, 585



Chapter Seventeenth.

A defence of the rejection, as unsound, of all legal propositions, depend-
ent upon the cases cited in the last two chapters, except those em-
bodied in the seventh and eighth rules 599

Article I. Examination of the prevalent theories derived from Williams
V. Leper, and kindred cases, 599

Article II. Discussion of the question whether the abstract proposition
can be supported, that a promise to pay the debt of another is not
within the statute, whenever the leading object of the promisor was
not to discharge the debtor, but to subserve some interest of his own,
distinct from the payment of the debt, and the consideration moved
to him, 610



Chapter Eighteenth.

Cases where a guaranty of the debt of a third person is not within the
statute, 639

Rule Ninth.

A guaranty is not within the statute, if it was made upon a consideration
moving wholly 1 etwecn the parties to it, and related to the payment
of a debt or the performance of a duty by the third person to the
promisee, the right to enforce which then first passed, or l)y the terms
of the contract was thereafter to pass to him, from or through the
guarantor, 640

Article I. "Where the debt or contract guarantied was transferred from
the guarantor to the guarantee, at the time of making the contract
of guaranty, upon a consideration moving wholly between the
parties, 640

Article II. Where the debt guarantied was thereafter to be contracted



Online LibraryMontgomery H. (Montgomery Hunt) ThroopA treatise on the validity of verbal agreements, as affected by the legislative enactments in England and the United States, commonly called the Statute of frauds (Volume 1) → online text (page 1 of 74)