and not as a consideration of a new and later promise.' So if a builder is under a contract to complete a house by a certain day and an outsider promises him a bonus if he will fulfill his contract the promise would be without a consideration. It would be otherwise, however, if the contract had been mutually rescinded or the contractor had good and sufficient reason for abandoning the work. A promise in consideration that he should complete it a day earlier than that required by his contract would be binding, and an extension of time by one party is a good consideration for the promise of another.' A request by the owner of a building, that subcontractors stop work for the reason that the contractor had overdrawn his account and that he could get it done more cheaply, and a refusal on the part of the subcontractors, whereupon the owner told them to go ahead and to send the bill to him, but to make a reduction in the price if possible, was held to create a contract between the owner and subcontractors on sufficient consideration.' An agreement of a construction company to commute its contract rate of compensation for finished work to a lower rate, because the work had not been completed as agreed, in consideration of which the other party consented to accept the work in its unfinished condition, affords a sufficient consideration to sustain the stipulated reduction." A contract to make an excavation at an agreed price, the contractor having examined the work before taking the contract, and having furnished. proof that it was found more difficult than was supposed, which was disputed by disinterested witnesses, is insufficient to show consideration to uphold a promise to pay an additional price.** An agreement to permit the contractor to retain twenty-five dollars already paid him above his expenses and to pay for the material furnished in consideration of the cancellation of the contract is not void for want of a consideration." A promise to pay for extra materials ordered by the architect, made before the work is completed, is founded on sufficient consideration as to materials already used, as well as those not used.' 67. The Consideration Must be Present.-The consideration must be present, i. e., in legal contemplation the promise or undertaking must be assumed the moment the consideration is completely performed. This would seem to be necessary if the consideration is given in exchange for the promise. A past act performed without regard to any promise cannot be said to have been given in exchange for the promise, and a promise made for a 1 Langdell's Summary of Contracts 1018. 2 Risley. Smith, 64 N. Y. 576 [1876], and cases cited. *Yoeman v. Mueller, 33 Mo. App. 343 [1889]. 4 Fitzgerald v. Fitzgerald & Mallory Const. Co. (Neb.), 59 N. W. Rep. 838. 5 Casterton v. McIntire, 23 N. Y. Supp. 301. Blagborne . Hunger (Mich.), 59 N. W. Rep. 657. Irwin v. Locke (Colo.), 36 Pac. Rep. 898. *See Sec. 563, infra. consideration already performed is simply a promise, without a consideration, and therefore cannot form an element of a binding contract. A promise made for a consideration to be thereafter performed, though invalid as a promise, may take effect as an offer and become binding if the consideration is performed before it is revoked or has ceased to exist. A promise made in consideration of some future act must be distinguished from a promise given in exchange for a promise to do some future act. In the former case the promise is in exchange for a future act, which is only an offer, while in the latter case the promise is in exchange for a present promise, and the promises themselves are the consideration, one for the other. When the consideration consists of performance the promise becomes binding when the act is performed. If an owner promise to pay a contractor a sum of money if he will do a particular act, and the contractor does the act, the promise thereupon becomes binding, though the contractor at the time did not engage to do the act. A promise in consideration of some past or future act must be distinguished from a promise for or in consideration of a promise to perform some deed or work some time in the future, or of a promise made on account of some past act by which the party derived some benefit or the other party suffered detriment. In the former case the past or future act itself would not be a sufficient consideration, but in the latter case the present promise is a good consideration. Thus if an owner says to a builder: "I will pay you ten thousand dollars to build me a house," and the builder says: "All right," and the builder thereupon. makes arrangements to build, it is not strictly an enforceable contract until the builder has built the house. The owner may revoke the offer any time before the builder has completed the house, i. e., furnished the stipulated consideration; and the builder can have no action for the revocation, there being no express contract, though the law will imply a contract by the owner to pay the builder the reasonable value of what he has received or been benefited. But if the owner says: "I promise to pay you ten thousand dollars if you promise [agree] to build me a house, payment when house is completed," to which the builder agrees, then the contract is supported by a present consideration, viz, the promise to build. So a promise to pay in consideration of some service rendered in the past, and not at the express or implied request of the promisor, is not binding.' In all these cases if the owner is free to refuse or can return what he has benefited or been enriched by the labors of the contractor, and he does not return it, the law will imply a contract to pay for it what it is reasonably worth to him; but the contractor does not recover upon an express contract made by him with the owner, but upon the contract imposed by the law to promote justice and to prevent unjust enrichment. If the 'Langdell's Summary of Contracts. 1024 v. Sweesy (Neb.), 67 N. W. Rep. 748; Train v. Gold, 5 Pick (Mass.) 380-285. Myers Dean (Com. Pl.), 32 N. Y. 3 Amer. & Eng. Ency. Law 838; Stuht Supp. 237. owner cannot restore what he has received he need not pay for it, as when a contractor has built a house upon the land of another without his knowledge or consent, or has built the house materially different from the one he contracted to build; there is no contract implied by law to pay for it, and the fact that the owner uses it and enjoys it does not add to his liability to pay for it.'* If a part of the consideration is present and a part past it will support the promise or agreement. Therefore when certain sums were subscribed to induce a contractor to complete the grading of a street begun under a contract with the city and in consideration of that agreement the contractor made a settlement with the city for the work then done and entered into engagements for its completion, which arrangements and expenditures he was not obliged to perform under his contract with the city, and which were necessarily productive of loss and injury in case of nonpayment, it was held that the consideration was amply sufficient to support an action for the amount pledged. A receipt in full by a subcontractor who claimed extra remuneration for extra work has been held a good consideration for a promise to pay for the same extra work if the promisor succeeded in getting an allowance for the same.' 68. From Whom Consideration Must Come.-The consideration of a contract must move from the person who receives the promise, i. e., the promisee. If it does not, then the promise cannot be said to ave been given in exchange for it, but as a gift, which is not binding on the promisor. Certain courts may and do allow persons for whose benefit the promise is made, i. e., the beneficiaries, to sue on a contract; but, as Professor Langdell has said in his Summary, the consequence is that the promisor is then liable to two actions-one by the promisee and one by the beneficiary. In truth a promise to A to pay one hundred dollars to B confers no right upon B in law or equity, but there are similar cases in which B has been allowed to recover against the promisor." Therefore a third party was held not liable for the work of a contractor, because he told him, while the work was in progress, to go on and do the work ordered by the owner and he would pay for it; nor for the reason that the owner introduced the third party to the contractor as his partner and coadjutor in the work, and that he was shown what was being done in connection with the owner, and that he expressed great satisfaction and told the contractor to go on and do all that the owner ordered and he would pay for it. Th. promise was held voluntary and without consideration." 13 Amer. & Eng. Ency. Law 839. 838. 3 Corrigan . Detsch, 61 Mo. 290 [1875]. Read o. Hitchins, 71 Me. 590 [1880]. [However, it was not a very brilliant thing on the part of the subcontractor to do unless required to do so to obtain the contract price.-ED.] 53 Amer. & Eng. Ency. Law 863. "Stidham v. Sanford, 36 N. Y. Sup. Ct. 341/1873) *See also Secs. 681, 697-703, infra. The principle is well illustrated in a case where the third party was a member of a committee to solicit aid towards the erection of a foundrybuilding, donated as an inducement for a foundry business to remove to a village where the third party resided. The third party had called upon an architect to solicit aid, at the same time telling him the purpose contemplated, and that whatever was done was to be a voluntary contribution. Under these circumstances, and without any express promise by the third party to pay him therefor, the architect prepared plans and specifications for the proposed building. It was held that to charge appellant for such plans an express promise to pay must be established, and such promise must have been made before the service was rendered; for if the work was not done on the credit of the third party, but for some other person, any subsequent express parol promise to pay for the same would be void as being a promise to pay the debt of a third person and being without consideration.' 69. Changes or New Terms in a Contract.-If a contract cannot be created without a valid consideration it would naturally follow that some consideration would be required to modify its terms or add new terms to an existing contract. Therefore when certain work was being done according to the contract and specifications, and the employer, under threats of stopping the work, and without any further consideration, exacted and secured from the contractor a guaranty concerning the work not embraced in the original contract, it was held that such guaranty was not binding upon the contractor, and that in an action brought by him for the contract price of the work a failure of said guaranty could not be set up as a defense by the owner." There is no doubt that at any time after a writen contract has been entered into the parties may orally either vary it or abrogate it, if there is a new consideration." Some tribunals have conceded that an executory parol contract may be varied, or even dissolved, before breach by an agreement to that effect without any new consideration, which involves the idea that if a person who has entered into a contract declare that he will not fulfill it as it stands, nor unless his demands are satisfied, and the other party assents, the new agreement will supersede the old one.* Thus it has been held that if a contractor threatens to abandon his contract on account of pretended mis 1 Dunton v. Chamberlain, 1 Bradwell 361 [1878]. Titus v. Cairo & T. R. Co., 37 N. J. Law 98. 3 McCarty v. The Hampton Bldg. Ass'n, 61 Ia. 287 [1883]. 4 Juilliard v. Chaffee, 92 N. Y. 529; Flanders v. Fay, 40 Vt. 316; Burkham v. Holmes v. Doane, 9 Cush. 135; Wilgus v. Whitehead, 6 W. N. of C. 537. * There are numerous decisions to the contrary, which are set forth in Secs. 181 and 559-564, infra. representations of the company, or because unexpected difficulties have been encountered, or because the work is too expensive, and the owner agrees to pay an extra price, the promise is binding, though apparently without consideration.' So it has been held that no new consideration was necessary to sustain an agreement by the owner to extend the time for completion of a building contract." An agreement without a consideration is repugnant to the law of contracts, and it may well be doubted if these cases as stated are good law.' If these cases were looked into it would be found that there were mutual promises or mutual acts to be performed, or that the question of consideration was not raised until the work was done and the contract executed. There are many cases that decide that a consideration is required to sustain a change in a contract, and to be safe, a consideration should always be insisted upon. If it is agreed between the owner and the contractor that the work shall be performed in a manner different from that originally agreed upon it has been argued that the undertaking of the contractor to do something different, though only in detail, and the relinquishing by the other party of the right to have it done in a particular manner, furnished consideration enough, and that the court would not go into the question whether it gave an actual advantage. A contract that has not been executed may be rescinded by mutual agreement, the parties exchanging promises not to enforce their rights; but a contract executed by the contractor, leaving only an obligation to pay on the part of the owner, cannot be rescinded by mutual consent without other consideration.** 70. Consideration Good in Part.-When an offer is made for a consideration named no promise arises until the consideration is fully performed. If the consideration consists of several things they must all be performed. If any part of the specified consideration is illegal the illegality will affect the whole, and there will be no binding promise.' If, however, a part only is void or voidable it is otherwise, for it is impossible to apportion the weight of each part of the consideration in inducing the promise. If, among several things named as consideration, a good and sufficient consideration can be found it is the same as if that alone had been specified as a consideration. Where independent promises are in part lawful and in part unlaw Hart . Launman, 29 Barb. 410; Osborne . O'Reilly, 42 N. J. Eq. 467 [1887]. Izard v. Kimmel (Neb.), 41 N. W. Rep. 1068 [1889]; Hill v. Smith, 34 Vt. 535; Rulge . Gates (Wis.), 38 N. W. Rep. 181 [1888]. Webbe v. Romona O. S. Co., 58 Ill. 8 Foster v. Daber, 6 Exch. 851; Morawetz on Corp'ns, § 371. 6 Westmoreland v. Porter, 75 Ala. 452 [1883]. 'Langdell's Summary of Contracts 1030; Pollock on Contracts (4th ed.) 321; Edwards Co. v. Jennings (Tex.), 35 S. W. Rep. 1053. 8 Clements v. Marston, 52 N. H. 31 [1873]. Langdell's Summary of Contracts 1030. *See Sec. 66, supra. |