The matter reducible value. of others. But if I contract to do work for A by a certain time and for a fixed reward, my general freedom is abridged by the special right of A to the performance by me of the stipulated work, and he too is in like manner obliged to receive the work and pay the reward. [*7] *4. The matter of the obligation, the thing to be done or forborne, must possess or must be reducible to a money to a pecuniary value, otherwise it would be hard to distinguish legal from moral and social relations. Gratitude for a past kindness cannot be measured by any standard. of value, nor can the annoyance or disappointment caused by the breach of a social engagement; and courts of law can only deal with matters to which the parties have attached an importance estimable by the standard of value current in the country in which they are.1 Sources of obligation. Agree ment. Delict. Obligation then is a control exerciseable by definite persons over definite persons for the purpose of definite acts or forbearances reducible to a money value. We may note here the various sources of obligation. 1. Obligation may arise from agreement. Here we find that form of agreement which constitutes contract. An offer is made by one, accepted by another, so that the same thing is, by mutual consent, intended by the one and expected by the other; and the result of this agreement is a legal tie binding the parties to one another in respect of some future acts or forbearances. 2. Obligation may arise from delict. This occurs where a primary right to forbearance has been violated; where, for instance, a right to property, to security, or to character has been violated by trespass, assault, or defamation. The wrong-doer is bound to the injured party to make 1 The parties may fix a pecuniary value to the doing or forbearing of an act which would otherwise not be reducible to a pecuniary standard; as the forbearing of a personal habit, Hamer v. Sidway, 124 N. Y. 538, H. & W. 143; the naming of a child, Wolford v. Powers, 85 Ind. 294; or the making of an affidavit, Brooks v. Ball, 18 Johns. (N. Y.) 337. good his breach of duty in such manner as is required by law. Such an obligation is not created by the free-will of the parties, but springs up immediately on the occurrence of the wrongful act. 3. Obligation may arise from breach of contract. While Breach of A is under promise to X, X has a right against A to the contract. performance of his promise when performance becomes due, and to the maintenance up to that time of the contractual relation. But if A breaks his promise, the right of X to performance has been violated, and, even if the contract is not discharged, a new obligation springs up, a right of action, *precisely similar in kind to that which arises upon a delict or breach of a duty.1 [*8] 4. Obligation may arise from the judgment of a court Judg of competent jurisdiction ordering something to be done ment. or forborne by one of two parties in respect of the other. It is an obligation of this character which is unfortunately styled a contract of record in English law. The phrase is unfortunate because it suggests that the obligation springs from agreement, whereas it is really imposed upon the parties ab extra.2 contract. 5. Obligation may arise from quasi-contract. This is a Quasiconvenient term for a multifarious class of legal relations which possess this common feature, that without agreement, and without delict or breach of duty on either side, A has been compelled to pay something which X ought to have paid or X has received something which A ought to receive. The law in such cases imposes a duty upon X to make good to A the advantage to which A is entitled; and in some cases of this sort, which will be dealt with 1 It is sometimes difficult to determine whether the obligation arises from delict or breach of contract. See Rich v. New York Central &c R., 87 N. Y. 382; Freeman v. Boland, 14 R. I. 39. 2 A judgment is not a contract within the provisions of the Federal constitution prohibiting state legislation impairing the obligation of contracts. Morley v. Lake Shore Ry., 146 U. S. 162; O'Brien v. Young, 95 N. Y. 428, H. & W. 76. Acts springing from agreement but wider than contract. Holmes on the Common Law, p. 300. Jurisprudence, ed. 7. p. 229. later, the practice of pleading has assumed a promise by X to A and so invested the relation with the semblance of contract.1 6. Lastly, obligation may spring from agreement and yet be distinguishable from contract. Of this sort are the obligations incidental to such legal transactions as marriage or the creation of a trust. It is no doubt possible that contractual obligations may arise incidentally to an agreement which has for its direct object the transfer of property. In the case of a conveyance of land with covenants annexed, or the sale of a chattel with a warranty, the obligation hangs loosely to the conveyance or sale and is so easily distinguishable that one may deal with it as a contract. In cases of trust or marriage the agreement is far-reaching in its objects, and the obligations incidental to it are either contingent or at any rate remote from its main purpose or immediate operation.2 In order, then, to keep clear of other forms of agreement *which may result in obligation we should bear in [*9] mind that to create an obligation is the one object which the parties have in view when they enter into that form of agreement which is called Contract.a a In an earlier edition (ed. 2. pp. 9-13) I discussed the views of Mr. Justice Holmes as to the nature of the contractual obligation, and of Dr. Holland as to its source: but these topics are better suited to a treatise on Jurisprudence than to an elementary book on the law of contract, and I now omit them from the text. Mr. Justice Holmes regards a contract as 'the taking of a risk.' He rigorously insists that a man must be held to contemplate the ultimate legal consequences of his conduct, and, in making a promise, to have in view, not its performance but the payment of damages for its breach. I cannot think it desirable to push legal analysis so far as to disregard altogether the aspect in which men view their business transactions. At the same time I feel it difficult to do justice to the argument of Mr. Justice Holmes within the limits which I could assign to myself here. I may say the same of Dr. Holland's view that the law does not require 1 Hertzog v. Hertzog, 29 Pa. St. 465, H. & W. 1; Dusenbury v. Speir, 77 N. Y. 144; Woods v. Ayres, 39 Mich. 345. 2 See ante, pp. 4-5, and notes. of con And so we are now in a position to attempt a definition Definition of contract, or the result of the concurrence of agreement tract. and obligation and we may say that it is an Agreement enforceable at law, made between two or more persons, by which rights are acquired by one or more to acts or forbearances on the part of the other or others.1 contracting parties to have a common intention but only to seem to have one, that the law 'must needs regard not the will itself, but the will as expressed.' Our difference may be shortly stated. He holds that the law does not ask for ' a union of wills' but only for the phenomena of such a union. I hold that the law does require the wills of the parties to be at one, but that when men present all the phenomena of agreement they are not allowed to say that they were not agreed. For all practical purposes our conflict of view is immaterial. A contract, as a legal transaction, can exist only in such a form as may be perceptible to a court of law. It is only from the words and conduct of the parties that a court can form any conclusion as to their intention. If their words or their acts are inconsistent with any supposition but that they meant to agree, or if one has so spoken or acted as to lead the other necessarily to that conclusion, the court will not permit the obvious construction of words or conduct to be denied. But, after all, it is the intention of the parties which the courts endeavour to ascertain; and it is their intention to agree which is regarded as a necessary inference from words or conduct of a certain sort. 1"It may be defined to be a transaction between two or more persons, in which each party comes under an obligation to the other, and each reciprocally acquires a right to whatever is promised by the other." Mr. Justice Washington in Dartmouth College v. Woodward, 4 Wheat. (U. S.) 518, 656. For various definitions collected and discussed see Justice v. Lang, 42 N. Y. 493. Elements necessary to a valid contract. Results of their absence. See ch. v. ad fin. PART II. THE FORMATION OF CONTRACT. WE have now to ascertain how contracts are made. A part of the definition of contract is that it is an agreement enforceable at law: it follows therefore that we must try to analyze the elements of a contract such as the law of England will hold to be binding between the parties to it These elements appear to consist: 1. In a distinct communication by the parties to one another of their intention; in other words, in offer and acceptance. 2. In the presence of certain evidence, required by law, of the intention of the parties to affect their legal relations. This evidence is form, or consideration. 3. In the capacity of the parties to make a valid con tract. 4. In the genuineness of the consent expressed in offer and acceptance. 5. In the legality of the objects which the contract proposes to effect. Where all these elements co-exist, the contract is valid: where any one of them is absent, the contract may be unenforceable, that is valid but incapable of proof: or voidable, that is capable of being affirmed or rejected at the option of one of the parties: or void, that is destitute of legal effect. These three terms may be more fully discussed later. |