Page:Harvard Law Review Volume 12.djvu/526

506 5o6 HARVARD LAW REVIEW. recovered a sum of money equivalent to his mortgage debt, and in exchange for the balance of the judgment received certain judgments which the tort-feasor held against the mortgagor. Held, that the plaintiff, the mortgagor, may, at his election, take the judgments against himself received by the defendant, or charge the defendant with the uncollected balance on the judgment against the tort-feasor. Woodrum v. Washington National Bank, 55 Pac. Rep. 333 (Kan., Sup. Ct.). See Notes. Contracts — Conditions — Satisfaction of the Promisor. — The defendant employed the plaintiff to paint a pastel portrait, the contract proyiding that if the por- trait were not satisfactory the defendant should not pay. The plaintiff then painted a portrait which the defendant rejected upon the ground that it was not satisfactory to him. Held^ that the plaintiff has no cause oi action. Pennington v. Howland, 41 Atl. Rep. 891 (R. I.). See Notes. Contracts — Consideration. — The defendant gave the plaintiff his non-nego- tiable note as a gift without any consideration, and the plaintiff, in reliance on the note, gave up a lucrative employment. Held, that the defendant is estopped to set up lack of consideration. Ricketts v. Scothern, 77 N. W. Rep. 365 (Neb.). It is hard to find any estoppel here, since the maker of the note never represented that there was any consideration for it. Moreover, the representation to raise an estoppel must be as to an existing fact, and not in the nature of a promise. White v. Asliton, 51 N. Y. 280; Insurance Co. v. Mowry, 96 U. S. ^i,; Jordan v. Money, 5 H. L. Cas. 185. Yet there are many decisions to the effect that where a note is given to a college or charitable institution, and the institution expends money in consequence, the donor cannot set up lack of consideration as a defence on the note. Church v. Garvey, 53 111. 401 ; Irwin v. Lombard Univ., 56 Ohio St. 9. Eut if the donee has not changed its position, the note is unenforceable. Simpson College. Tuttlcji Iowa, 596; Reim- ejtsftyderw. Cans, tio Pa. St. 17; Miller. Western College, 52 N. E. Rep. 432 (111.). This must be regarded as an innovation, and it is doubtful if it has ever before been extended to a gift to a private individual. The whole doctrine is repudiated in some states. Methodist Chtirch v. Kendall, 121 Mass. 528, Contracts — Statute of Frauds — Constructive Trusts. — In consideration of the conveyance of certain land by the deceased to her mother, her father, for him- self and the mother, orally promised to transfer their rights in certain other land to the deceased's husband. The conveyance to the mother was made, but the parents later refused to perform their part. In a suit in equity by the husband to which the heirs of deceased were made parties, held, that if the parents do not carry out their agreement the land conveyed to the mother will revert to the estate. Simons v. Bedell, 55 Pac. Rep. 3 (Cal, Sup. Ct.). The mother cannot be compelled to carry out the agreement, because it was not in writing; but if she refuses, the court correctly decide there should be a constructive trust for the heirs of grantor of the land received. It is inequitable for her to retain the consideration while refusing to carry out the contract. In England, where one has given a promise within the Statute of Frauds in return for the receipt of land or chattels, he will be compelled to give back that which he has received if he refuses to carry out the agreement. Haigh v. Kaye, 7 Ch. App. 469. In this country, generally, where land is so conveyed the courts will not compel a reconveyance, Stevenson v. Chapnell, 144 111. 19; but, where the point has come up, the grantor is allowed to re- scind the contract and to recover the value of the land conveyed in an action for land sold. Smith v. Hatch, 46 N. H., 146. This is an anomalous doctrine, and the prin- cipal case, which is in accord with the English rule, seems to state the correct view. The Statute of Frauds is not violated, but equity thus prevents it from being used as an instrument of fraud. Even in the United States one is allowed to recover money paid, in return for a parol agreement for the conveyance of land, and to sue in trover for chattels given under a like arrangement. The principle should be the same where land is given for the promise. Allen v. Booker, i Stewart, 21 ; Keith v. Patton, i A. K. Marshall, 23. Corporations — Contracts. — The plaintiffs contracted with a number of persons who intended to form a corporation to build a factory for it. The factory was built and the corporation was formed and used the factory. Held, that it is liable on the contract. Chicago Building Co. v. Creamery Co., 31 S. E. Rep. 809 (Ga.). In general a corporation is not liable on the personal contracts of its promoters. Western Screw Co. v Cousley, 72 111. 531. But when it has enjoyed the benefits of such contracts, it is generally held liable on them. This is sometimes put on the ground of ratification. Whitney v. Wyman, loi U. S. 392; Oakes v. Water Co., 143 N. Y. 430. This reasoning seems erroneous, for to have a ratification the principal for whom the agent claimed to act must have been in existence at the time the contract was made.