the debtor did not owe the debt or that it was an illegal debt? The true answer to this question depends upon the true meaning in fact of the promise rather than upon any rule of law. If the promisor's agreement is to be construed as a promise to discharge whatever liability the promisee is under, the promisor must certainly be allowed to show that the promisee was under no liability. Thus one who in return for an assignment of property assumed all the grantor's debts would certainly be allowed to dispute the validity of any debt. On the other hand, if the promise means that the promisor agrees to pay a sum of money to A, to whom the promisee says he is indebted, it is immaterial whether the promisee is actually indebted to that amount or at all. The promisee has decided that question himself. Where the promise is to pay a specific debt, for example to assume a specific mortgage, this construction will generally be the true one. Most of the cases accordingly refuse to allow one who has assumed a specific debt to set up usury 1 or other defences 2 of which the debtor might have availed himself.

1

In dealing with any of these defences it is obvious that all three parties should have an opportunity of litigating the question since all are interested in it, and it is desirable to have all concluded by the judgment. If a creditor who sues the promisor and is met by the defence of fraud or mistake in the contract nevertheless prevails, but being unable to collect his judgment sues the original debtor, as he would be allowed to do in many jurisdictions, clearly

1 Millington v. Hill, 47 Ark. 301; People's Bank v. Collins, 27 Conn. 142; Henderson v. Bellew, 45 Ill. 322; Valentine v. Fish, 45 Ill. 462; Essley v. Sloan, 16 Ill. App. 63; Flanders v. Doyle, 16 Ill. App. 508; Cleaver v. Burcky, 17 Ill. App. 92; Stephens v. Muir, 8 Ind. 352; Hough v. Hersey, 36 Mo. 181; Log Cabin Assoc. v. Gross, 71 Md. 456; Scanlan v. Grimmer, 71 Minn. 351; Cramer v. Lepper, 26 Ohio St. 59; Jones v. Insurance Co., 40 Ohio St. 583; Spaulding v. Davis, 51 Vt. 77; Conover v. Hobart, 24 N. J. Eq. 120; Post v. Dart, 8 Paige 639; Cole v. Savage, 10 Paige 583; Root v. Wright, 21 Hun 344; Sands v. Church, 6 N. Y. 347; Hartley v. Harrison, 24 N. Y. 170; Ritter v. Phillips, 53 N. Y. 586 (payment). But see Knickerbocker Life Ins. Co. v. Nelson, 78 N. Y. 137.

2 Pope v. Porter, 33 Fed. Rep. 7 (informal execution); Kennedy v. Brown, 61 Ala. 296 (coverture); Gowans v. Pierce, 57 Kan. 180 (unauthorized signature to note); Cox v. Hoxie, 115 Mass. 120 (erroneous amount); Comstock v. Smith, 26 Mich. 306 (coverture); Miller v. Thompson, 34 Mich. 10 (invalid execution); Crawford v. Edwards, 33 Mich. 354 (failure of consideration); Lee v. Newman, 55 Miss. 365 (invalidity); Johnson v. Parmely, 14 Hun 398 (payment); Ferris v. Cranford, 2 Den. 595 (payment); Horton v. Davis, 26 N. Y. 495 (want of record); Freeman v. Auld, 44 N. Y. 50 (failure of consideration); Parkinson v. Sherman, 74 N. Y. 88 (failure of consideration); Bennett v. Bates, 94 N. Y. 354, 370 (invalidity of mortgage). But see Goodman v. Randall, 44 Conn. 321.

the debtor cannot be concluded by the judgment in the first case and the creditor must try the same question again and perhaps with a different result. This is another illustration of the necessity of all three parties being joined in the litigation.1

None of the earlier cases which allowed a right of action to one who was not a party to the contract related to contracts under seal, and where statutes have not taken away the importance of the distinction between sealed and parol contracts the rule that one who is not a party to a contract under seal cannot sue upon it is still applied to contracts to benefit or pay a debt to a third person.2 But in some states the rules of the common law distinguishing contracts under seal from other written contracts have been abolished or diminished, so that it is not surprising that the distinction as to the right of a third person to sue has also been disregarded.3

It sometimes happens that a person who is neither the promisee of a contract nor the party to whom performance is to be rendered will derive a benefit from its performance. A typical case

1 In Green v. Stone, 54 N. J. Eq. 387, the court held that the defence that the clause assuming payment of a mortgage was inserted in a deed by mistake must be asserted by a cross bill to which the promisee must be made a party.

2 Hendricks v. Lindsay, 93 U. S. 143; Willard v. Wood, 135 U. S. 311, 313; 152 U. S. 502; Douglass v. Branch Bank, 19 Ala. 659; Hunter v. Wilson, 21 Fla. 250, 252; Gunter v. Mooney, 72 Ga. 205; Moore v. House, 64 Ill. 162; Gautzert v. Hoge, 73 Ill. 30; Harms v. McCormick, 132 Ill. 104, 109 (now changed by statute); Hinkley v. Fowler, 15 Me. 285; Farmington v. Hobart, 74 Me. 416; Seigman v. Hoffacker, 57 Md. 321; Montague v. Smith, 13 Mass. 396; Millard v. Baldwin, 3 Gray 484; Robb v. Mudge, 14 Gray 534, 538; Flynn v. North American Life Ins. Co., 115 Mass. 449; Lee v. Newman, 55 Miss. 365, 374; How v. How, 1 N. H. 49; Crowell v. Currier, 27 N. J. Eq. 152; Joslin v. New Jersey Car Spring Co., 36 N. J. L. 141, 146; Cocks v. Varney, 45 N. J. Eq. 72; Strohecker v. Grant, 16 S. & R. 237; De Bollé v. Pennsylvania Ins. Co., 4 Whart. 68; Mississippi R. R. Co. v. Southern Assoc., 8 Phila. 107; McAlister v. Marberry, 4 Humph. 426; Fairchild v. North Eastern Assoc., 51 Vt. 613; Jones v. Thomas, 21 Gratt. 96, 101 (now changed by statute); McCarteney v. Wyoming Nat. Bank, 1 Wyo. 382.

8 Central Trust Co. v. Berwind-White Co., 95 Fed. Rep. 391; Starbird v. Cranston, 24 Col. 20; Webster v. Fleming, 178 Ill. 140; Harts v. Emery, 184 Ill. 560; Robinson v. Holmes, 75 Ill. App. 203; Am. Splane Co. v. Barber, 91 Ill. App. 359; 1 Bush 48; Jefferson v. Asch, 53 Minn. 446; Rogers v. Gosnell, 51 Mo. 466; 58 Mo. 589; Van Schaick v. Railroad, 38 N. Y. 346; Coster v. Albany, 43 N. Y. 399; Riordan v. First Church, 26 N. Y. Supp. 38; Emmitt v. Brophy, 42 Ohio St. 82; Hughes v. Oregon Co., 11 Oreg. 437; McDowell v. Laev, 35 Wis. 181; Basset v. Hughes, 43 Wis. 319; Houghton v. Milburn, 54 Wis. 554; Stites v. Thompson, 98 Wis. 329, 331. A third person was allowed to enforce a promise under seal also in the following cases, but the point was not discussed: South Side Assoc. v. Cutler Co., 64 Ind. 560; Anthony v. Herman, 14 Kan. 494; Brenner v. Luth, 28 Kan. 581. See also Va. Code, § 2415; New berry Land Co. v. Newberry, 95 Va. 111.

A

is where A promises B to pay him money for his expenses. creditor of B is not generally allowed to sue A.1 It is obvious that such a creditor's right can properly be only a derivative one. As the obligation is to pay money to the debtor, there seems no reason why garnishment proceedings are not appropriate.

A different case arises where the promise is to indemnify against damages. Here the promisor's liability does not arise until the promisee has suffered loss or expense. Until then the promisee

has no right of action, and consequently one claiming damages can assert no derivative right against the promisor, much less a direct right.2 Nor can the promisee sue for the benefit of persons claiming damages.3

A third person's benefit under a contract may be still more incidental. In a recent case the failure of the grantee of land to keep his promise to the grantor to pay a mortgage, resulted in a loss to the plaintiff of an interest in the land when the mortgagee foreclosed the mortgage. The New York court rightly refused relief.4 The contract was not made even partially for the plaintiff's benefit, and as the promisee was under no obligation to the plaintiff it is not possible to work out an indirect right.5

A Louisiana case 6 furnishes another illustration. A number of hatters agreed to close their shops on Sundays, and for any breach it was agreed that the offender should pay $100 to a specified charitable society. It was held that the society could not recover. The object of the contract was not to benefit the plaintiff, but to enforce performance of a promise by the imposition of a penalty. Samuel Williston.

1 Cragin v. Lovell, 109 U. S. 194, 199; Thomas Mfg. Co. v. Prather, 65 Ark. 27; Burton v. Larkin, 36 Kan. 246. See also Jackson Iron Co. v. Negaunee Concentrating Co., 65 Fed. Rep. 298; Hill v. Omaha, etc., R. R. Co., 82 Mo. App. 188. But see contra Rothwell v. Skinker, 84 Mo. App. 169; Houghton v. Milburn, 54 Wis. 554. And where an insurance company had reinsured its risks, a policy holder was allowed to sue the reinsuring company directly in Glen v. Hope Mut. Life Ins. Co., 56 N. Y. 379; Fischer v. Hope Mut. Life Ins. Co., 69 N. Y. 161; Johannes v. Phenix Ins. Co., 66 Wis. 50.

2 Hill v. Omaha, etc., R. R. Co., 82 Mo. App. 188; French v. Vix, 143 N. Y. 90; Embler v. Hartford Ins. Co., 158 N. Y. 431; Mansfield v. Mayor of New York, 165 N. Y. 208

8 New Haven v. Railroad, 62 Conn. 253.

4 Durnherr v. Rau, 135 N. Y. 219. See also Pearson v. Bailey, 62 N. E. Rep. 265 (Mass.).

5 See also Constable v. National Steamship Co., 154 U. S. 51; Hennessy v. Bond, 77 Fed. Rep. 403, 405.

• New Orleans St. Joseph's Assoc. v. Magnier, 16 La. Ann. 338.

NOTE I.

Recovery allowed by a sole beneficiary in an action at law (insurance cases are not included).

ARKANSAS. Rogers v. Galloway Female College, 64 Ark. 627.

GEORGIA. Wilson v. First Presbyterian Church, 56 Ga. 554. See also Code, § 3664. ILLINOIS. Lawrence v. Oglesby, 178 Ill. 122.

INDIANA. Allen v. Davison, 16 Ind. 416; Beals v. Beals, 20 Ind. 163; Marlett v. Wilson, 30 Ind. 240; Miller v. Billingsly, 41 Ind. 489; Henderson v. McDonald, 84 Ind. 149; Waterman v. Morgan, 114 Ind. 237; Stevens v. Flannagan, 131 Ind. 122; Ferris v. American Brewing Co., 155 Ind. 539. Except for the Code the plaintiff would have to sue in equity.

KANSAS. Strong v. Marcy, 33 Kan. 109.

KENTUCKY. Clarke v. McFarland's Exec., 5 Dana 45; Smith v. Smith, 5 Bush 625; Benge v. Hiatt's Adm. 82 Ky. 666; Paducah Lumber Co. v. Paducah Water Supply Co., 89 Ky. 340. See also McGuire v. McGuire, 11 Bush 142; Mercer v. Mercer's Adm., 87 Ky. 30. Except for the Code plaintiff would have to sue in equity.

LOUISIANA.

MARYLAND.

Civil Code, Arts. 1884, 1896.

Owings v. Owings, 1 H. & G. 484, 491. MASSACHUSETTS. Felton v. Dickinson, 10 Mass. 287 (overruled by Terry v. Brightman, 132 Mass. 318; Marston v. Bigelow, 150 Mass. 45). 13 Pick. 133; Bacon v. Woodward, 12 Gray 376, 382; Mass. 291.

See also Felch v. Taylor, Prentice v. Brimhall, 123

MISSOURI. St. Louis v. Von Phul, 133 Mo. 561; Devers v. Howard, 144 Mo. 671; Crone v. Stinde, 156 Mo. 262; Weinreich v. Weinreich, 18 Mo. App. 364; Markel v. W. U. Tel. Co., 19 Mo. App. 80; Glencoe Lime Co. v. Wind, 86 Mo. App. 163. But see Phoenix Ins. Co. v. Trenton Water Co., 42 Mo. App. 118; Howsmon v. Trenton Water Co., 119 Mo. 304.

NEBRASKA. Hale v. Ripp, 32 Neb. 259; Sample v. Hale, 34 Neb. 220; Lyman v. Lincoln, 38 Neb. 794; Doll v. Crume, 41 Neb. 655; Korsmeyer Co. v. McClay, 43 Neb. 649; Chicago, etc., R. R. Co. v. Bell, 44 Neb. 44; Kaufmann v. Cooper, 46 Neb. 644; Hickman v. Layne, 47 Neb. 177, 180; Fitzgerald v. McClay, 47 Neb. 816; King v. Murphy, 49 Neb. 670; Rohman v. Gaiser, 53 Neb. 474; Pickle Marble Co. v. McClay, 54 Neb. 661. But see Eaton v. Fairbury Water Works Co., 37 Neb. 546. NEVADA.

See Ferris v. Carson Water Co., 16 Nev. 44.

NEW JERSEY. Rue v. Meirs, 43 N. J. Eq. 377, 384; Whitehead v. Burgess, 61 N. J. L. 75.

NEW YORK. Schermerhorn v. Vanderheyden, 1 Johns. 139, 140; Glen v. Hope Mutual L. I. Co., 56 N. Y. 379; Little v. Banks, 85 N. Y. 281; Todd v. Weber, 95 N. Y. 181; Rector v. Teed, 44 Hun 349, 120 N. Y. 583; Buchanan v. Tilden, 158 N. Y. 109; Roberts v. Cobb, 31 Hun 150; Knowles v. Erwin, 43 Hun 150; affd. 124 N. Y. 633; Whitcomb v. Whitcomb, 92 Hun 443; Babcock v. Chase, 92 Hun 264; Luce v. Gray, 92 Hun 599. But see contra Lorillard v. Clyde, 122 N. Y. 498; Townsend v. Rackham, 143 N. Y. 576; Sullivan v. Sullivan, 161 N. Y. 554; Wainwright v. Queen's County Water Co., 78 Hun 146; Coleman v. Hiler, 85 Hun 547; Buffalo Cement Co. v. McNaughton, 90 Hun 74, affd. 156 N. Y. 702, re-argument denied, 1 57 N. Y. 703; Glens Falls Gas Light Co. v. Van Vranken, 11 N. Y. App. Div. 420.

OHIO. Flickinger v. Saum, 40 Ohio St. 591, 601; Irwin v. Lombard Univ., 56 Ohio St. 9, 20.

PENNSYLVANIA. Strohecker v. Grant, 16 S. & R. 237, 241, semble; Ayers Appeal, 28 Pa. 179; Hostetter v. Hollinger, 117 Pa. 606. But see contra Edmundson v. Penny, 1 Barr 334; Guthrie v. Kerr, 85 Pa. 303.

RHODE ISLAND. Adams v. Union R. R. Co., 21 R. I. 134. But see contra Wilbur v. Wilbur, 17 R. I. 295.

SOUTH CAROLINA. Thompson v. Gordon, 3 Strobh. 196.

UTAH. See Montgomery v. Rief, 15 Utah 495.

VERMONT. Hodges v. Phelps, 65 Vt. 303. But see contra Crampton v. Ballard, 10 Vt. 251; Hall v. Huntoon, 17 Vt. 244; Fugure v. Mut. Soc. of St. Joseph, 46 Vt. 362.

VIRGINIA. Taliaferro v. Day, 82 Va. 79; Code of 1887, § 2415. But see contra Ross v. Milne, 12 Leigh 204; also Newberry Land Co. v. Newberry, 95 Va. 111. WEST VIRGINIA. Johnson v. McClung, 26 W. Va. 659, 670. WISCONSIN. Grant v. Diebold Safe Co., 77 Wis. 72.

UNITED STATES. Nat. Bank v. Grand Lodge, 98 U. S. 143. Conf. Constable v. National Steamship Co., 154 U. S. 51; conf. Sayward v. Dexter, 72 Fed. Rep. 758; U. S. v. National Surety Co., 92 Fed. Rep. 549; Brown & Haywood Co. v. Ligon, 92 Fed. Rep. 851.

NOTE II.

Action at law allowed against one who promises to pay the debt of another (mortgage cases are not included).

ALABAMA. Huckabee v. May, 14 Ala. 263; Hoyt v. Murphy, 18 Ala. 316; Mason v. Hall, 30 Ala. 599; Henry v. Murphy, 54 Ala. 246; Young v. Hawkins, 74 Ala. 370; Dimmick v. Register, 92 Ala. 458; North Ala. Development Co. v. Short, 101 Ala. 333; Potts v. First Nat. Bank, 102 Ala. 286.

ARKANSAS. Chamblee v. McKenzie, 31 Ark. 155; Talbot v. Wilkins, 31 Ark. 411; Hecht v. Caughron. 46 Ark. 132; Ringo v. Wing, 49 Ark. 457, 464; Benjamin v. Birmingham, 50 Ark. 433. But see contra Hicks v. Wyatt, 23 Ark. 55, and conf. Thomas Mfg. Co. v. Prather, 65 Ark. 27.

CALIFORNIA. Lewis v. Covelland, 21 Cal. 189; Morgan v. Overman Co., 37 Cal. 534; Malone v. Crescent Co., 77 Cal. 38; Smith v. Los Angeles, etc., Ry. Co., 98 Cal. 210; Alvord v. Spring Valley Gold Co., 106 Cal. 547; Whitney v. Am. Ins. Co., 127 Cal. 464 (overruling McLaren v. Hutchinson, 18 Cal. 80, contra).

COLORADO. Lehow v. Simonton, 3 Col. 346; Green v. Morrison, 5 Col. 18; Starbird v. Cranston, 24 Col. 20; Wilson v. Lunt, 11 Col. App. 56.

See also Code, § 3664.

Strait, 19 Ill. 88; Briston v

FLORIDA. Hunter v. Wilson, 21 Fla. 250; Wright v. Terry, 23 Fla. 160. GEORGIA. Ford v. Finney, 35 Ga. 258, 261 (semble). ILLINOIS. Eddy v. Roberts, 17 Ill. 505; Brown v. Lane, 21 Ill. 194; Rabberman v. Niskamp, 54 Ill. 179; Wilson v. Bevans, 58 Ill. 232; Beasley v. Webster, 64 Ill. 458; Steele v. Clark, 77 Ill. 471; Snell v. Ives, 85 Ill. 279; Shober Co. v. Kerting, 107 Ill. 344; Schmidt v. Glade, 126 Ill. 485; Cobb v. Heron, 78 Ill. App. 654, 180 Ill. 49; Mathers v. Carter, 7 Ill. App. 225; Struble v. Hake, 14 Ill. App. 546; Boals v. Nixon, 26 Ill. App. 517; Williamson-Stewart Co. v. Seaman, 29 Ill. App. 68; McCasland v. Doorley, 47 Ill. App. 513; Rothermel v. Bell & Zoller Co., 79 Ill. App. 667; Kee v. Cahill, 86 Ill. App. 561; Am. Splane Co. v. Barber, 91 Ill. App. 359.

INDIANA. Cross v. Truesdale, 28 Ind. 44; Davis v. Calloway, 30 Ind. 112; Hag. gerty v. Johnston, 48 Ind. 41; Campbell v. Patterson, 58 Ind. 66; Loeb v. Weis, 64 Ind. 285; South Side Planing Mill Assoc. v. Cutler, etc., Co., 64 Ind. 560; Rhodes v. Matthews, 67 Ind. 131; Fisher v. Wilmoth, 68 Ind. 449; Clodfelter v. Hulett, 72 Ind. 137; Medsker v. Richardson, 72 Ind. 323; Hendricks v. Frank, 86 Ind. 278; Harrison v. Wright, 100 Ind. 515, 533; Warren v. Farmer, 100 Ind. 593; Wolke v. Fleming, 103 Ind. 105; Redelsheimer v. Miller, 107 Ind. 485; Leake v. Ball, 116 Ind. 214; Boruff v. Hudson, 138 Ind. 280. The early Indiana cases before the enactment of the code allowed relief only in equity. Salmon v. Brown, 6 Blackf. 347; Farlow v.