§ 7. A proposal need not be made to an ascertained person,

hut no contract can arise until it has been accepted by an

ascertained personi

An offer The proposition is best understood by an illustration.

made to all T^^® proposal by way of advertisement of a reward for the

the world, rendering of certain services, addressed to the public at large,

cannot becomes a contract to pay the reward so soon as an individual

it, till it is renders the services, but not before.

accepted ^o hold that any contractual obligation exists before the

services are rendered, would amount to saying that a man

may be bound by contract to an indefinite and unascertained

body of persons, or, as it has been expressed, that a man

may have a contract with the whole world. This would be

contrary to the notions both of Agreement and Obligation,

Chap. 1. § 7. PROPOSAL AND ACCEPTANCE. 2^

which we have ascertained to co-exist in Contract. Agreement

Ib the expression of a common intention, and there can be

none while intention is expressed on one side only ; nor can

we say that Obligation in the sense of a vinculum juris

exists between a definite proposer, and the indefinite mass

of persons to whom it is open to accept his proposal.

The matter would have seemed beyond doubt if it were Savigny's

not that Savigny considered that an obligation of this in-

definite character was created by such a proposal as we have

described. From the difficulties which would arise, owing

to the obligation being incurred to unascertained persons,

he would allow no right of action to accrue, but, upon the

performance of the condition, he put the promisor in the

position of a man who owes a debt of honour which is not sav. obi. 2.

* sect. 61.

recoverable in a Court of Law. This view has never been

seriously entertained in English law; the promise is re-

garded as being made, not to the many who might accept

the offer, but to the person or persons who do accept it.

One may think, with submission to the great authority of

Savigny, that his mode of dealing with this subject arises

from a disregard or forgetfulness of the principle that the

pre-eminent feature of Obligation is the binding together

of definite persons by a vinculum juris; that until the

parties have emerged from the mass of mankind the bond

cannot attach to them.

The difficulties which have arisen in English law are Difficulties

of a somewhat different character, but are capable, it should law."^ ^^

seem, of a satisfactory solution. They spring from two

sources, (i) The acceptor may not, at the time of his

doing what amounts to an acceptance, realise all the terras

of the offer : can he afterwards take advantage of them ?

(2) It is sometimes difficult to distinguish representations

of intention to act in a particular way, from invitations

which, if accepted, become binding promises.

The first difficulty is well illustrated by the case of of accept-

ance.

26 FOBMATION OF CONTRACT* Part IT,

4B. &Ad.6ai. Williams v, Oarwardine, Reward was offered by the de-

fendant for information which the plaintiff supplied, though

not with a view to the reward. It was hdd that the

defendant was liable as upon a contract concluded by ihe

supply of the information asked for.

If it appeared dearly from the facts of this case as re-

ported that the plaintiff was unaware of the defendant's offer,

it might be asked, whether that could be an agreement in

which one of the parties knew nothing of the intention of

the other. But the only point urged in the argument for

the defendant was that the reward was not the motive which

induced the plaintiff to supply the information, and the

Court held that the motive was immaterial, and that ' there

was a contract with the person who performed the con-»

dition mentioned in the advertisement.'

Intimation The second difficulty has been suggested as arising in

of course of -• ^ ^• i i •-■••11 •!

conduct as cases where a public body, or an individual ; a railway

distinct company, or the manager of a theatre, makes a standing

tion. offer to the public at large to carry them, or to entertain

contri^trisi. them in a certain manner and subject to certain terms.

And it has been asked, in substance, whether an acceptance

of the general offer in such a case binds the proposer to

fulfil all his terms.

Railway For instance, does the existence of its published time-

time-tabie. ^g^jj^g jjjj^^ g^ railway company to carry passengers according

to its terms ?

p. i8i. . The answer is that the time-table is not, as Hr. Pollock

seems to suggest, the offer of a separate promise, but a term

in the general contract to carry : and the judicial interpre-

tation put upon this term is, that when a passenger has

Le Blanche v. acccptcd the gcucral offer by demanding a ticket, he becomes

286.' ' ^' ^' ^' entitled to reasonable efforts being made on the part of the

company to ensure punctuality.

Announce- Similarly it might be said, though the question may

perform- probably never arise, that the manager of a theatre offers

Chap. I. § 7, PROPOSAL AND ACCEPTANCE. ^^

to any one who takes tickets for a particular play, that ance at a

reasonable diligence shall be used to secure the performance

of the piece advertised. If the disappointed playgoer can

show a failure of such diligence, and should think it worth

while to sue for the price of his ticket, it is not impossible

that he might recover upon the principle laid down in Lt

Blanche v. London and North-Western Raikoa/y Company, ^^ *^' **• "

But there are some cases of more real difficulty than these ; ^^

cases in which it is hard to distinguish generisil offers the

acceptance of which by individuals constitutes a contract,

from declarations of intention upon which persons may act

without affecting their legal relations.

The two foUowii^ cases will well illustrate the fineness of a sa4e by

of the distinction. In Harris v, Nicherson an advertisement , „ „ ' „

L. R. 8 Q. B.

by an auctioneer, that a sale of certain articles would take ^^

place on a certain day, was held not to bind the auctioneer

to sell the goods, nor to make him liable upon a contract

to idemnify persons who were put to expense in order to

attend the sale. Blackburn, J., said : ' Unless every declara-

tion of intention to do a thing creates a binding contract

with those who act upon it, and in all cases after advertising

a sale the auctioneer must give notice of anj' articles that

are withdrawn, we cannot hold the defendant liable.'

On the other hand, the advertisement of a sale vjithout

reserve was held, in Warhw v, Harrison, to create a binding x e. & e. 295.

contract between the auctioneer iind the highest bidder that

the goods should be knocked down to him. ' The sale/

said Martin, B., ' was announced by them (the auctioneers)

to be "without reserve." This, according to all the cases

both at law and in equity, means that neither the vendor

nor any person in his behalf shall bid at the auction, and

that the property shall be sold to the highest bidder, whether

the sum bid be equivalent to the real value or not : Thornett "s m. & w.

v. Haines. We cannot distinguish the case of an auctioneer

putting up property for sale upon such a condition from

a8 FORMATION OF CONTRACT. Part 11.

the case of the loser of property ofFering a reward, or that

of a railway company puhlishing a time-table stating the

times when, and the places to which, the trains run. It has

been decided that the person giving the information adver-

tised for, or a passenger taking a ticket, may sue as upon

5 E. & B. 86a a contract with him : Denton v. Great Northern BaUway

Company. Upon the same principle, it seems to us that

the highest bona fide bidder at an auction may sue the

auctioneer as upon a contract that the sale shall be without

wariow V. reservc.' Such was the opinion of the maiority of the Court

Harrison, • * o j

I E. & E. 316. Qf Exchequer Chamber.

The substantial difference between the cases seems to lie

in this, that not merely the number, but the intentions of

the persons who might attend the sale must be unascertain-

able, nor could it be certain that their legal relations would

be eventually altered by the fact of their attendance. A

might come intending to buy but might be out-bid, B might

come with a halfrformed intention of buying if the goods went

cheaply, G might come merely for his amusement. It would

be impossible to hold that an obligation could be established

between the auctioneer and this indefinite body of perrons,

or that their losses could be ascertained so as to make it

reasonable to hold him liable in damages. The highest

bidder, on the other hand, is an ascertained person, fulfilling

the terms of a definite offer. The distinction therefore

bears out the proposition laid down at the commeneement

of this discussion.

Chap. II. FORM AND CONSIDERATION. ag

CHAPTER II.

Form and Consideration.

We haye now dealt with the mode in which the common Necessity

intention of the parties should be communicated by the one ^i^^se marks

to the other so as to form the basis of a contract. But it j^ English

law.

is not enough that sucb communication should be made as

we have described, or even that the parties should intend

it to refer to legal consequences. Most systems of law re-

quire certain marks to be present in the agreements which

they will recognise as contracts, and, if those marks are

absent, the intention of the parties will not avail to create

an obligation between them. 'In English law there are

two such marks — ^Porm and Consideration ; sometimes one,

sometimes the other, sometimes both are required to be

present in a contract to make it enforceable. By Form we

may be taken to mean some peculiar solemnity attaching to

the expression of Agreement which of itself gives efficacy

to the contract; by Consideration some gain to the party

making the. promise, arising from the act or forbearance,

given or promised, of the promisee.

In English, as in Roman, law. Form, during the infancy History of

of the system, is the most important ingredient in Contract. matter.

Consideration is an idea which, though not unknown, is at

any rate imperfectly developed. It would not be desirable

here to enter upon an antiquarian discussion, which is never-

theless of considerable interest. It is enough to say that Common

English law, and also, we may venture to say, Roman law, Wstoiy^oT

30 FORMATION OF CONTRACT. Part II.

Roman and starts with two distinct conceptions of Contract. One is, that

law^ ^^ Form of a certain kind will make any promise binding ; the

other is, that the acceptance of benefits of a certain kind will

imply such a promise to repay them as the law will enforce.

The theory that the Boman Contracts developed out of Con-

veyance in an order of moral progression seems to rest on

no sure evidence ; and there is reason to believe that the

Stijyulatio, or solemn promise elicited by a formal question,

and the informal contract Re, which arose from the lending

or deposit of money, or goods, were the most ancient of the

seeApp. A. coutracts Jknown to E,oman law» At any rate, in English

law we find that before the end of the thirteenth century

two kinds of contract were enforceable :. one Formal, the

contract under seal, answering to the StiptdoMo; one informal,

arising from sale and delivery of goods, loan of money, and

the like, in which the consideration had been executed upon

one side, and an implied or express promise to repay would

support an action of Debt. Except in these limited cases, the

idea of enforcing an informal promise, simply because a

benefit was accruing or was about to accrue to the promisor

by the act or forbearance of the promisee, does not appear

to have been entertained before the middle or end of the

fifteenth cetitury.

The Formal Contract of English law is the Contract

under Seal. In no other way than by the use of this

Form could validity be given to executory contracts, until

the doctrine of consideration began to make way. "We

have to bear in mind that it is the Form which makes this

contract binding; the consensus of the parties has not

emerged from the ceremonies which surround its expression.

Courts of Law will not trouble themselves with the inten-

tions of parties who have not couched their agreement in

the solemn Form to which the law attaches legal conse-

quences. Nor, on the other hand, where Form is present

will they ask for further evidence as to intention. Later

Chap.n. FOEM AND CONSIDERATION. 3 1

on, owing in great measure we may suspect to the influence

of the Court of Chancery, the intention of the parties begins

to engage the attention of the Courts, and the idea of the

importance of Form undergoes a curious change. When a

contract comes before the Courts, evidence is required that

it expresses the genuine intention of the parties; and this

evidence is found either in the solemnities of the Contract

under Seal, or in the presence of Consideration, that is to

say, in some benefit to the promisor or loss to the promisee,

granted or incurred by the latter in return for the promise

of the former. Gradually Consideration comes to be re-

garded as the important ingredient in Contract, and then

the solemnity of a deed is said to make a contract binding

because it 'imports consideration,' though in truth it is

the Form which, apart from any question of consideration,

carries with it legal consequences.

Before considering in detail the classes of contract which

English law recognises, it is well to conclude the historical

outline of the subject of Form and Consideration. ,

We have stated that the only -contracts which English law

originally recognised, were the Formal contract under Seal,

and the informal contract in which Consideration was exe-

cuted upon one side. How then do we arrive at the modem

breadth of doctrine that any promise based upon Considera-

tion is binding upon the promisor 1 This question resolves

itself into two others. How did informal executory con-

tracts become actionable at alH How did Consideration

become the universal test of their actionability ]

To answer the first question we must look to the remedies

which, in the early history of our law, were open to persons

complaining of the breach of a promise, express or implied.

The only actions of this nature, during the thirteenth and

fourteenth centuries, were the actions of Covenant, of

Debt, and of Detinue. Covenant lay for breach of promises

made under seal : Debt for liquidated or ascertained claim,

3i^ FORMATION OF CONTRACT. Part II.

arising either from breach of covenant, or from non-payment

of a sum certain due for goods supplied, work done, or

money lent : Detinue* lay for the recovery of specific chattels

kept back by the defendant from the plaintiff. These were

the only remedies based upon contract. An executory agree-

ment therefore, unless made under seal, was remediless.

The remedy by which such promises were eventually

enforced is a curious instance of the shifts and turns by

which practical convenience evades technical rules. The

breach of an executory contract, until quite recent times,

gave rise to a form of the action of Trespass on the case.

snence, This was a development of the action of Trespass :

Chancery ■•■ *

jimsdict Trespass lay for injuries resulting from immediate violence :

Trespass on the case lay for the consequences of a wrongful

act, and proved a remedy of a very extensive and flexible

character.

Origin of » This action came to be applied to contract in the foUow-

assumTCit. ^S ^^7' ^^ W originally for a malfeasance, or the doing

an act which was wrongful ah initio : it next waS' applied to

a misfeasance, or improper conduct in doing what it was not

otherwise wrongful to do, and in this form it applied to pro-

fi'Sason ^^^^^ part-performed and then abandoned or negligently ex-

"i. 395. 396. ' ecutcd to thc detriment of the promisee : finally, and not

without some resistance on the part of the Courts, it came to

be applied to a non-feasance, or neglect to do what one was

bound to do. In this form it adapted itself to executory con-

pouock, 138. tracts. The first reported attempt so to apply it was in the

reign of Henry IV, when a carpenter was sued for a non-feas-

ance because he had undertaken, qua/re assumpsisaet, to build a

house and had made default. The judges in that case held that

the action, if any, must be in covenant, and it did not appear

* The Court of Appeal has very recently decided that the action of

L.R.3C.P. D. Detinue is founded in tort, Bryant v. Herbert. But though the wrong-

^' ful detention of goods is the cause of action, the remedy may apply to

cases in which the possession of the goods originated in the contract of

Baihnent. [See judgment of Brett, L. J., at p. 392.]

Chap. II. FORM AND CONSIDERATION. 33

that the promise was under seal. But in course of time the Reasons for

desire of the King's Bench to extend its jurisdiction, the sion.

fear that the Common Pleas might develope the action of

Deht to meet the case of executory promises, or that the

Court of Chancery might extend its extraordinary powers,

and hy means of the doctrine of consideration, which it had

ah'eady applied to the transfer df iuterests in land, enlarge

its jurisdiction over contract, operated to produce a change

ill the attitude of the Common (Law Courts. Before the end

of the reign of Henry VII it was settled that the form of

Trespass on the case known henceforth as the action of

Assumpsit would lie for the non-feasance, «or non-perform-

ance of an executory contract ; and the form of writ by

which this action was commenc>ed, continued to perpetuate

this peculiar aspect of a breach of a promise until recent

enactments for the simplification of procedure.

It is not at all improbable that the very difficulty of

obtaining a remedy for breach of an executory contract led

in the end to the breadth and simplicity of the law as it

stands at present. If the special actions ex controLctu had

been developed to meet purely executory informal engage-

ments, they would probably have been applied only to en-

gagements of a particular sort, and a class of contracts

similar to the consensual contracts of Eoman law, privi-

leged to be informal, might have been protected by the

Courts, as exceptions to the general rule that Form or

executed Consideration was needed to support a promise.

But the conception that the breach of a promise was some-

thing akin to a wrong, the fact that it could be remedied

only by a form of action which was originally applicable

to wrongs, had a somewhat peculiar result. The cause

of action was the non-feasance of that which one had

undertaken to do, not the breach of a particular kind of

contract ; it was therefore of universal application. Thus all

promises would become binding, and English law was saved

34

FORMATION OP CONTRACT.

Part II.

Origin of

considera-

tion as a

test of ac-

tionability

is uncer-

tain.

Gradual

growth of

doctrine.

the technicalities which must needs arise from a classifica-

tion of contracts. Where all promises may be actionable

it follows that there must be some universal test of action-

ability, and this test was supplied by the doctrine of Con-

sideration.

It is no easy matter to say how Consideration came to

form the basis upon which the validity of informal promises

might rest. It is suflScient for the purposes of the present

work to say that the idea of Consideration, or a * quid

pro quo ' as it is styled in some of the early reports, was

probably borrowed by the Common Law Courts from the

Chancery.

For the Chancellor was in the habit of enquiring into the

intentions of the parties beyond the Form, or even in the

absence of the Form in which, by the rules of Common Law,

that intention should be displayed, and he would find evi-

dence of the meaning of men in the practical results to them

of their acts or promises. It was thus that in the region

of conveyance, the Covenant to stand seised and the Bargain

and Sale of Lands came to be enforced in the Chancery

before the Statute of Uses, and the doctrine once applied

to simple contract was found to be of great practical con-

venience. When a promise came before the Courts they

asked no more than this, * Was the party making the

promise to gain anything from the promisee, or was the

promisee to sustain any detriment in return for tlie pro-

mise ] ' if so, there was a * quid pro quo * for the promise,

and an action might be maintained for the breach of it.

So silent was the development of the doctrine that

Consideration was the universal requisite of contracts not

under seal, and so marked was the absence of any express

authority for the rule in its broad and simple application,

that Lord Mansfield was able in the middle of the last cen-

tury to raise the question whether, in the case of cdmmercial

contracts made in writing, there was any necessity for Con-

Chap. 11. POBM AND CONSIDERATION. 35

sideration to support the promise. In the case of PUlans v.

Van Mierop he held, and the rest of the Court of King's Bench 3 Burr. 1672.

concurred vrith him, that the custom of merchants would

give efficacy to a written promise for which no consideration

could be shown. The case was decided on another point,

and the doctfine was emphatically disclaimed in the opinion

of the Judges delivered not long afterwards in the House of 7 t. r. 350.

Lords, in Rann v, Hughes; but the question raised serves

to show that the breadth of the law upon this subject was,

until comparatively recent times, hardly realised by those

who had to administer it*

J) 2

36 FORMATION OF CONTRACT. Part II.

CLASSIFICATION OF CONTRACTS.

Contracts There is but one Formal Contract in English law, the

or Simple. ' ^^^ ^r Contract under seal ; all others are simple contracts

depending for their validity upon the presence of Considera-

tion. The Legislature has, however, imposed upon some

of these simple contracts the necessity of some kind of Form,

and these stand in an intermediate position between the Deed

to whicli its Form alone gives legal force, and the Simple

C(yntract "which rests upon Consideration and is free from

the imposition of any Statutory Form. In addition to these

a •certain class of Obligation has been imported into the Law

•of Contract under the title of Contracts of Kecord, and though

these obligations are wanting in the principal features of Con-

tract, it is necessary, in deference to established authority,

to treat of them here.

The Contracts known to English law may then be divided

thus :—

Classifica- A. {Formal,

cont^s. »■• «• dependent for

their validity

upon their Form.

B. Simple,

4. e. dependent for

their validity

upon the pre-

sence of Con-

sMeration.

1. Contracts of Record.

2. Contract under Seal.

3. Contracts required by

law to be in some

form other than un-

der Seal.

4. Contracts for which no

form is required.

It will be best to deal first with the essentially formal

contracts, then with those forms which are superim|x>sed

upon simple contracts, and then with Consideration, the

requisite commcm to aiU simple contracts.

Chap. II. § I. FOBM. CONTRACTS OF RECOBD. 37

Formal Contract.