3. The parties must communicate to one another their known to common intention. Thus a mental assent to an offer can- both, not constitute an agreement. a1 A writes to X and offers [*3] * to buy X's horse for £50. X makes up his mind to accept, but never tells A of his intention to do so. He cannot complain if A buys a horse elsewhere. relations, 4. The intention of the parties must refer to legal rela- referring tions it must contemplate the assumption of legal rights to legal and duties as opposed to engagements of a social character. It is not easy to prescribe a test which shall distinguish these two sorts of engagements, for an agreement may be reducible to a pecuniary value and yet remain outside the sphere of legal relations. The matter is one which the courts must decide, looking at the conduct of the parties and the circumstances of the case.2 5. The consequences of agreement must affect the parties themselves. Otherwise, the verdict of a jury or the decision of a court sitting in banco would satisfy the foregoing requisites of agreement.3 Agreement then is the expression by two or more persons of a common intention to affect their legal relations. a See the dicta of Lord Blackburn in the case of Brogden v. Metropolitan Railway Company (2 App. Ca. 691). It appears from the Records of the Proceedings in the House of Lords (Appeal Cases, 1877, vol. vii. pp. 98, 106) that Lord Coleridge, C. J., and Brett, J., had in giving judgment in the Common Pleas used language suggesting that a mere mental consent uncommunicated to the other party might create a binding agreement. Lords Selborne and Blackburn express their dissent from such a proposition, the latter very fully and decidedly. 1 "A mental determination not indicated oy speech, or put in course of indication by act to the other party, is not an acceptance which will bind the other. Nor does an act, which, in itself, is no indication of an acceptance, become such, because accompanied by an unevinced mental determination." Folger, J., in White v. Corlies, 46 N. Y. 467, H. & W. 7. 2 Keller v. Holderman, 11 Mich. 248, H. & W. 71; McClurg v. Terry, 21 N. J. Eq. 225, H. & W. 72. 3 O'Brien v. Young, 95 N. Y. 428, H. & W. 76; Morley v. Lake Shore Ry., 146 U. S. 162. and affect ing the parties. Agreement a wider term than contract. It may not create obligation. As to gift see Hill v. Wilson, L.R. 8 Ch. 888. Or may only create it But agreement as thus defined seems to be a wider term than contract. It includes legal transactions of two kinds besides those which we ordinarily term contracts. These are: (1) Agreements the effect of which is concluded so soon as the parties thereto have expressed their common consent in such manner as the law requires. Such are conveyances and gifts, wherein the agreement of the parties effects at once a transfer of rights in rem, and leaves no obligation subsisting between them.1 (2) Agreements which create obligations incidental to transactions of a different and wider sort. These also remotely. effect their main object immediately upon the expression of intention; but they differ from simple conveyance and gift in creating further outstanding obligations between the parties, and sometimes in providing for the coming into existence of other obligations, and those not between the original parties to the agreement. [#4] *Marriage, for instance, effects a change of status directly the consent of the parties is expressed before a competent authority; at the same time it creates obligations between the parties which are incidental to the transaction and to the immediate objects of their expression of consent.2 So too a settlement of property in trust, for persons born and unborn, effects much more than the mere con 1 Conveyances, grants and gifts are conveniently spoken of as contracts. Indeed they are held to be contracts under the clause of the Federal constitution prohibiting state legislation "impairing the obligation of contracts." See Fletcher v. Peck, 6 Cranch (U. S.), 87, H. & W. 696, where Mr. Chief Justice Marshall says: "A contract executed, as well as one which is executory, contains obligations binding on the parties. A grant, in its own nature, amounts to an extinguishment of the right of the grantor, and implies a contract not to reassert that right. A party is, therefore, always estopped by his own grant." See also Oregon Pac. R. v. Forrest, 128 N. Y. 83, 90, where it is said that an executed agreement is valid without any consideration. 2 Maynard v. Hill, 125 U. S. 190, 210-214. veyance of a legal estate to the trustee; it imposes on him incidental obligations some of which may not come into existence for a long time; it creates possibilities of obligation between him and persons who are not yet in existence. These obligations are the result of agreement. Yet they are not contract.1 We need not pause to consider agreements which, though intended to effect legal relations, fail to do so because they fail to satisfy some requirement of the municipal law of the country in which they are made. It remains to ascertain the characteristic of contract as distinguished from the forms of agreement which we have described. essential to con An essential feature of contract is a promise by one A promise party to another, or by two parties to one another, to do or forbear from doing certain specified acts. By a promise tract. we mean an accepted promise as opposed to an offer of a promise, or, as Austin called it, a pollicitation. An offer must be distinguished from a statement of Nature of intention. An offer imports a willingness to be bound an offer. to the party to whom it is made; thus, if A says to X 'I mean to sell one of my sheep if I can get £5 for it,' there is a mere statement which does not admit of being turned into an agreement: but if A says to X'I will sell you whichever of my sheep you like to take for £5,' we .have an offer. mise. A promise, again, must be distinguished from an offer. Of a proAn offer becomes a promise by acceptance: until acceptance it may be withdrawn, after acceptance its character is changed. If A says to XI will sell you my horse for £50,' and X says 'agreed,' there is a promise by A to sell, a promise by X to buy, and a contract between the two. 1 Sherwood v. Andrews, 2 Allen (Mass.), 79; Wyble v. McPheters, 52 Ind. 393; Jackson v. Twenty-third St. Ry., 88 N. Y. 520. Nature of obligation. Savigny, Obl. ch. 1. ss. 2-4. A control needing two parties. Faulkner v. Lowe, Hoyle v. [*5] *To make that sort of agreement which results in Contract then differs from other forms of agreement § 2. Obligation. Obligation is a legal bond whereby constraint is laid upon a person or group of persons to act or forbear on behalf of another person or group. Its characteristics seem to be these. 1. It consists in a control exerciseable by one or both of two persons or groups over the conduct of the other. They are thus bound to one another, by a tie which the Roman lawyers called vinculum juris, until the objects of the control are satisfied, when their fulfilment effects a solutio obligationis, an unfastening of the legal bond. 2. Such a relation as has been described necessitates two parties, and these must be definite. There must be two, for a man cannot be under an obligation to himself, or even to himself in conjunction with others. Where a man borrowed money from a fund in which he and others were jointly interested, and covenanted to repay the money to the joint account, it was held that he could not be sued upon his covenant. 'The covenant to my mind is senseless,' said Pollock, C.B. a It will be shown on *page 12 that an offer may be of an act, and that the promise resulting from acceptance may be made by the acceptor. 'I do not know what is meant in point of law by a man paying himself.'1 must be *And the persons must be definite. A man cannot The [*6] be obliged or bound to the entire community: his lia- parties bilities to the political society of which he is a member are definite. matter of public, or criminal law. Nor can the whole community be under an obligation to him: the correlative right on his part would be a right in rem, would constitute property as opposed to obligation. The word Obligation has been unfortunately used in this sense by Austin and Bentham as including the general duty, which the law imposes on all, to respect such rights as the law sanctions. Whether the right is to personal freedom or security, to character, or to those more material objects which we commonly call property, it imposes a corresponding duty on all to forbear from molesting the right. Such a right is a right in rem. But it is of the essence of obli- Holland, gation that the liabilities which it imposes are imposed on definite persons, and are themselves definite: the rights which it creates are rights in personam. Jurispru dence, ed. 7. p. 212. also 3. The liabilities of obligation relate to definite acts or The liaforbearances. The freedom of the person bound is limited bilities only in reference to some particular act or series or class definite. of acts. A general control over the conduct of another would affect his status as a free man, but obligation, as was said by Savigny, is to individual freedom what servitus is to dominium. One may work out the illustration thus: I am owner of a field; my proprietary rights are general and indefinite my neighbour has a right of way over my field; my rights are to that extent curtailed by his, but his rights are very definite and special. So with obligation. My individual freedom is generally unlimited and indefinite. As with my field so with myself, I may do what I like with it so long as I do not infringe the rights 1 Gorham's Adm'r v. Meacham's Adm'r, 63 Vt. 231, H. & W. 88; Eastman v. Wright, 6 Pick. (Mass.) 316. |