Contracts Commons^™

Sales-Conditional-Resale By Seller

Michigan Law Review

Plaintiff bought a truck under a conditional sales contract. Defendant, as assignee of the vendor, retook possession of the truck when plaintiff defaulted in his payments and undertook by sale of the truck to foreclose plaintiff's rights therein. The Uniform Conditional Sales Act, in force in the jurisdiction, provided for a compulsory resale at public auction by the retaking seller. He was required to give notice of the sale by registered letter to the buyer, by newspaper advertisement, and by three notices posted in public places. Defendant failed to post the three notices. Plaintiff then brought suit for conversion and …

Contracts--Risk Of Loss Under Executory Land Contract--Disposition Of Insurance Process.

Michigan Law Review

When buildings, which are part of the subject matter of an executory contract for the sale of land, are accidentally destroyed by fire, there immediately arises the question of who, as between the vendor and the purchase, shall bear the loss. The majority of courts in this country place it on the purchaser. This was the result reached in the leading English case of Paine v. Meller and has been adopted in the following states: California, Indiana, Iowa, Kentucky, Louisiana, Maryland, Missouri, Montana, Nebraska, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, South Dakota and West Virginia. …

Contracts-Rescission For Substantial Breach-Lien For Improvements Given Vendee

Michigan Law Review

For statement of facts see preceding note in this issue, Younger v. Caroselli, 251 Mich. 533, 232 N.W. 378.

According to the majority view in the United States, a builder, whose substantial breach of contract (the instant case can hardly be considered one of substantial performance) is merely negligent and in good faith, can recover the value of his labor and materials less the damage caused the promisee.

Deeds-Side Of Lake As Boundary-Presumption That Grantee Takes To Center

Michigan Law Review

ln a conveyance of land adjoining a lake, the description read in part, "thence running northerly * * * to the Rockland Lake thence westwardly along the south side of the Rockland Lake." Held, that the grantee took to the center of the lake. White v. Knickerbocker Ice Co. et al. (N. Y. 1930) 172 N.E. 452.

Fraud-By Third Party-Mistake As To Nature Of Transaction-Rescission As Remedy

Michigan Law Review

The plaintiff was injured as a result of the alleged negligence of the defendant company. His attorney induced him to sign a general release, representing that it was only a receipt for seven hundred and fifty dollars paid on account by the defendant company. The plaintiff was illiterate and relied upon the fraudulent representations of his attorney. In an action to set aside the release, held, on a motion for judgment on the pleadings, that the complaint stated a cause of action, and that the plaintiff was not negligent in relying upon the representations of his attorney. Affirmed. Pimpinello …

Injunction-Breach Of Negative Covenant-Adequate Remedy At Law

Michigan Law Review

The defendant, an owner of a gasoline station, entered into a contract with the plaintiff whereby he agreed to buy "all motor fuels handled, sold, or required" at his station from the plaintiff. He further agreed not to "sell, or allow to be sold on his premises * * * any other brands of motor fuel than those of the seller [plaintiff]." Before the expiration of the contract the defendant notified the plaintiff that he would no longer be bound by the contract. The lower court dismissed a bill praying for an injunction restraining the defendant from violating the negative …

Master And Servant-Tests Of Independent Contract

Michigan Law Review

The claimant was employed by a dairy company to sell and deliver milk along a defined route, his "payment being in the form of a commission on each bottle sold. He was required to make daily payments in cash for milk and cream sold, but had the privilege of returning unsold milk or cream at the end of each day. Horses and vehicles were hired from the company at a stated price per day. Claimant was injured by a fall from his wagon while making deliveries. The State Industrial Board held him to be a servant and awarded him workmen's …

Mechanic's Liens-Time Of Filing-Completion Of Work

Michigan Law Review

The plaintiff contracted to do plumbing work, the contract containing a one-year guaranty. The work was finished in December, 1926, and in February, 1928, two months after the guaranty had expired, the plaintiff at the request of the owner (defendant), gratuitously made some minor repairs. In March, 1928, he filed a claim for a lien for the entire contract. Held, the work was completed when the guaranty expired and the plaintiff had no lien, since his claim was filed after the statutory limit from the completion of the work. Bohinek v. Smith (Ohio App. 1930) 172 N.E. 852.

Specific Performance-Uncertainty Of Contract

Michigan Law Review

Bill for specific performance of a contract made with defendant's assignor. Defendant was the assignee of some leases, and took with notice of the contract with his assignor. By the contract the owner of the leases "sold, and does sell" to plaintiff all the natural gas that he might produce under them. Either party was given the right to terminate if production fell below a certain point, and it was also provided that unless terminated under this provision, the contract was to remain in force during the entire time that gas was produced "in paying or marketable quantities." Defendant showed …

Wills-Presentation Of Claims

Michigan Law Review

An action on a contract was commenced against the testator during his life time. After his death notice was given to claimants to present their claims as provided by statute, P. L. 1920 p. 96. On the expiration of the time limit the court granted a rule barring further presentation of claims. The action begun against the testator was then revived against the executor in pursuance of statutory authority, 1 Comp. St. 1910, p. 4. Held, that the action commenced against the testator was properly revived against the executor in accordance with the abatement statute, supra. Pull v. Nagle …

Carriers-Contract Against Liability For Negligence By Telephone Company

Michigan Law Review

Plaintiff sought to recover for damages to its business resulting from the failure of defendant company to list plaintiff's main office and number and the incorrect listing of plaintiff's branch office in the 1928 telephone directory plaintiff being a subscriber to defendant's service. The contract of service contained a clause providing that defendant shall not be liable "for damages arising from errors or omissions in the making up or printing of its directory." The court held that in the absence of any showing of gross negligence or wilful misconduct; there was no liability for the omission and error. Hamilton Employment …

Contracts-Breach Of Implied Warranty That Construction Be Usable For Purpose Intended

Michigan Law Review

Plaintiff and defendant entered into a contract by the terms of which defendant was to assign to plaintiff an equity in a land contract to purchase a lot. The plaintiff was to complete the payments and sell to the defendant on a land contract this same lot with a house and garage to be erected by the plaintiff, an experienced builder, according to plans and specifications to be drawn by the latter. The defendant was to be given credit for the amount he had previously paid on the lot, and the price was further reduced by the defendant doing the …

Insurance-Automobile Club Membership-Contract To Furnish Legal Services

Michigan Law Review

Complainant automobile club agreed to furnish its members with the services of an attorney, but not to pay judgments rendered, in any action brought by or against any member as a result of the ownership, or operation, of his automobile. Held, a contract of insurance. Allin v. Motorists' Alliance (Ky. 1930) 29 S.W. (2d) 19.

Quasi-Contracts--Improvements On Land Of Another By Mistake

Michigan Law Review

Plaintiffs filed a bill in chancery seeking compensation for a house built on the defendants' lot due to an error on the part of the plaintiffs. The lower court granted a decree offering the defendants the election of taking the improvements at a fair value found by the court or of releasing the lot to the plaintiffs on the plaintiffs' paying its fair value. On appeal, held, this relief was proper. Hardy et al. v. Burroughs et al. (Mich. 1930) 232 N.W. 200.

Carriers - Liability For Goods Lost By Express Company While Performing Service Contrary To The Filed Tariff

Michigan Law Review

The filed tariff of the defendant express company provided that packages containing money would be received only when delivered at the office of the express company. It was the custom of the defendant. contrary to the tariff provisions, to send a special truck to the office of the shippers when notified that money was to be transported. A shipment oi the plaintiff was thus called for, and the money lost when the truck was held up on the way to the express office. Defendant contended that the service was in violation of the tariff, and that no recovery could be …

Contracts - Consideration - Forbearance To Exercise A Right

Michigan Law Review

Defendant was the assignee of a mortgage on a farm owned by the plaintiff. He gave newspaper notice of intent to foreclose, and ten days before the foreclosure period expired he signed and delivered to the plaintiff a writing in which he "agreed" to pay them three thousand dollars "providing said foreclosure of mortgage expires in my name." The foreclosure did so expire and this suit was brought to recover the money promised. Held, the promise is not enforceable, due to lack of consideration. Shaw v. Philbrick (Me. 1930) 151 Atl. 423.

Corporations-Power To Delegate Management For Long Period

Michigan Law Review

The corporate parties contracted that in consideration of certain commissions to be paid to the plaintiff, the defendant insurance company should delegate to the plaintiff corporation complete and exclusive control and management of its entire business for a period of twenty years. In an action to recover commissions, held, that the contract was void on the ground of public policy, and that there could be no recovery. Sherman & Ellis, Inc., v. Indiana Mutual Casualty Company (C. C. A. 7th Cir.) 41 F.(2d) 588.

Divorce-Award Not Of "Alimony"-Modification

Michigan Law Review

In a divorce decree the court incorporated an agreement of the parties to the effect that the husband should pay to the wife "as permanent alimony the sum of $1,200 per annum, to be paid in monthly installments for the period of the wife's life." Upon remarriage of the wife, the husband filed a bill praying for an order modifying the decree. Held, the original decree was not a decree for alimony, but was an incorporation of an agreement of the parties, and therefore the court lacked power to modify it. Spear v. Spear (Md. 1930) 149 AtI. 468.

Quasi-Contracts -- Recovery For Legal Services Rendered Under Champertous Contract

Michigan Law Review

Plaintiff agreed to render legal services to defendant in an action to recover a farm, payment to be either $5,000 in cash or one-third of the appraised value of the farm at the time of a judgment in defendant's favor. The defendant recovered, but refused to pay the plaintiffs anything on the ground that the contract was in violation of a Maine statute forbidding prosecution of a suit on shares. Plaintiff sued in assumpsit for the value of services rendered and expenses incurred. Held, the contract was illegal and so no relief of any nature would be granted. Hinckley …

Contracts-Right Of A Third Party Beneficiary

Michigan Law Review

Husband and wife agreed with each other to make mutual wills which would leave one-third of the estate of the survivor in equal portions to seven relatives, four of whom were the mother and three sisters of the husband and the remaining three, a niece and two sisters of the wife. After the husband's death the wife made another will, revoking the former one and providing for a different distribution of her property. After her death the mother and three sisters of the deceased husband filed a bill for the specific performance of the contract to make mutual wills. Held …

Banks And Banking--Damages--Liability Of Bank To Depositor For Wrongful Dishonor Of Check

Michigan Law Review

In an action by a creditor against his debtor for the non-payment of the debt, the ordinary measure of damages for non-performance of the contract is the sum of money itself with interest at the legal rate from the time it was due. Tradition has it that the relation between bank and depositor is that of debtor and creditor. Clearly, it is a contractual relationship. The contract, however, is not merely to pay the creditor but also to pay, on his behalf, such third persons as he may designate. It is not an adequate description to say, merely, that the …

Quasi-Contracts--Duress--Economic Pressure-Adequacy Of Legal Remedies

Michigan Law Review

The plaintiff deposited funds with the defendant, a stock-broker, as security for his margin account. The defendant without authority sold short on the plaintiff's account a large number of shares of stock and threatened to use the plaintiff's deposits to cover the sale unless the plaintiff would authorize a purchase for that purpose. The plaintiff under protest authorized the defendant to purchase the stock, which in the meanwhile had increased in value. The plaintiff then brought suit to recover the difference between the sale and the re-purchase prices plus the defendant's commissions and transfer taxes. Held, on demurrer that …

Quasi-Contracts--Duress--Tort Action For

Michigan Law Review

The court in the instant case implied by way of dictum that the plaintiff could have recovered if duress had existed. Perhaps as to the commissions sufficient benefit was conferred upon the defendant to form the basis of quasicontractual liability. WOODWARD, LAW OF QUASI-CONTRACTS, sec. 211; Astley v. Reynolds, 2 Strange 915; Darling-Singer Lumber Co. v. Oriental Navigation Co., 127 Or. 655, 272 Pac. 275.

Torts-Inducing Breach Of Contract

Michigan Law Review

A contracted to build a dwelling for B, a negro. C, learning that A was building the structure for B, called on B and gave B to understand that the neighborhood would not permit B to use the building after completion. There were no direct threats, nor was there any violence, nor was B requested to cancel the contract. A sues C for inducing the breach which follows C's conversation with B. Held, A was entitled to damages even though C bore no malice toward A and did not intend to cause damage to A. Carson v. Stephens (La. …

Corporations-Stock Conversion-Obligation Of Interstate Carrier

Michigan Law Review

Plaintiff, holding preferred stock of the defendant railroad convertible into common stock, sought to exercise his right of conversion, and on the railroad's failure to comply, filed the present suit for damages. The answer set up as an affirmative defense that the defendant, an interstate common carrier, is subject to the jurisdiction of the Interstate Commerce Commission; by the 1920 amendment to the Interstate Commerce Act, 49 U. S. C. A. sec. 20a, it was made unlawful for any carrier to issue stock except by the Commission's sanction; on Feb. 7, 1927, for the first time demand was made for …

Pleading-Combining Alternative Allegations And Reliefs

Michigan Law Review

Defendant musicians' association had ordered defendant orchestra to terminate its services with plaintiff restaurant, whereupon plaintiff filed a so-called alternative bill praying relief. The first set of allegations stated a written contract with the association by which it was to furnish as its agents an orchestra, added that it was mutually understood that defendant orchestra was meant, and prayed that the association be ordered to specifically perform. The alternative bill made no mention of the written contract, but set out an oral one with defendant orchestra with which defendant association was maliciously and without right interfering, and prayed that defendant …

Review: The Recission Of Contracts And Cancellation Of Written Instruments

Michigan Law Review

A review of THE RECISSION OF CONTRACTS AND CANCELLATION OF WRITTEN INSTRUMENTS By Henry Campbell Black.

Quasi-Contracts-Dutiful Intervention-Discharge Of Public Officer's Duty

Michigan Law Review

By statute in Montana the boards of county commissioners were ordered to cause such highways as were necessary for the public welfare to be "laid out, recorded, opened" and maintained. A highway was laid out through the plaintiff's land in 1903, but the county commissioners refused to continue constructing it though requested to do so by the plaintiff, instead compelling him to remove the fences on his property. His entire land being thus thrown open to the public, he constructed the road himself in 1926, with the knowledge of the commissioners, who on its completion immediately accepted it but refused …

Marriage-Annulment For Fraudulent Misrepresentation As To Intent To Cohabit

Michigan Law Review

An interesting problem as to what constitutes fraud sufficient to invalidate a marriage is raised by the recent Illinois case of Bielby v. Bielby. 165 N.E. 231. The husband asked annulment on the ground of the wife's misrepresentation as to her intent to cohabit. The evidence as to the wife's intent and as to whether the marriage was actually consummated was undecisive, the wife testifying that it was and the husband that it was not. However, he did not testify that he had ever requested consummation or that she had ever refused it. It was held there could not …

Suretyship-Application Of Payments From Principal To Creditor-Equity Of Surety In Building Contract Funds

Michigan Law Review

A building contractor's bond, with professional surety, promises to see that all laborers and materialmen assisting upon a certain construction job are fully paid. With moneys received from work upon this building, the contractor pays a certain sum to a materialman without applying it to any particular debt. The contractor owes the materialman upon two separate debts: one for materials furnished upon this very job, and covered by this surety bond; and a pre-existing debt, in no way connected with the present contract. Is the surety able to insist that the materialman use this payment to discharge the debt on …