учебный год 2023 / A secret paradox of common law

212 Richard Bronaugh

contract, the promise of performance is likewise sufficient."41 Therefore, oblique bilateral contracts are also good. In short, where benefit to the external party exists, obliqueness as such does not count against a contract.

Thus it becomes a matter of first importance why Williston admitted "benefit to the promisor" as consideration. At the vital instant in the 1914 essay one cannot read these words without astonishment: "I conceive that discussion to be well worth while

whether benefit to the promisor is not sufficient consideration. That, however, is another story, and I will only say here that I have changed my mind. ..."42 In reality Williston was simply

bringing his definition of consideration into conformity with definitions repeatedly given by the courts. (This is made clear in Williston on Contracts.43) Once that definitional concession was made, it is a matter of simple logic that all oblique contracts are in principle good, whatever the American courts were doing. At least Williston could be consistent, though the courts were not.

8. AN AMERICAN EXAMPLE

To illustrate how an American decision was made around this time and how Williston's last solution would attack it, one may look at

the 1917 Kentucky case of McDevitt v. Stokes.44 A jockey was hired by C to ride a race. That was the original bilateral contract. A, the breeder of C's horse, later offered the jockey $1,000 should he ride and win; this is an alleged contract, unilateral and oblique. The jockey won the race, but the breeder did not pay the full sum. Pleading no sufficient consideration for his promise of the money, the breeder succeeded and the plaintiff jockey did

41Williston, 'Consideration in Bilateral Contracts,' p. 521. (This mediating premise is derivedfrom the Englishwriter Stephen M. Leake, The Elements of the Law of Contracts(London: Stevens, 1867), p. 34.)

42Ibid., p. 524.

43See Williston on Contracts, Volume I, section 131A (New York, 1936).

44(1917, Ky.) 192 S.W. 681.

the defendant because the jockey originally "was already both morally and legally bound to perform the service required of him by the alleged contract...."45 This much is no surprise.But it was established that the breeder's unsold horses increased in value by

$25,000 as a result of the win. Does not benefit to the promisor count as consideration? Yes, said the court, but only if the benefit

is a "legal" one, not merely a money gain. The McDevitt court quoted Page on Contracts: "'Benefit' does not refer to any pecuniary gain arising out of the transaction. ... [It] means that the promisor has, in return for a promise, acquired some legal right to which he would not otherwise have been entitled...."46 Of

course Williston would not have fallen for this Langdellianfallacy in Page. "Legal benefit" is as circularas "legal detriment." So the factor of benefit, which Williston was finally forced to admit, was being neutralized by an old fallacy. On Williston's 1914 approach the jockey should have gotten the full sum promised by the breeder. There was an executed consideration in fact by riding the race; sufficiency was provided in the breeder's gain; and there was no public policy violated.47

in orderto formandexecutethe contractThere.is a differentperformance

46(1917), Ky.) 192 S.W.681, 682.

47Of course,theremaybe goodhorseracingpolicyin the unstatedback-

offshoot agreement; nothing would have been breached by

short, the fatherwas not seeking to "protect"the engagement.

Third,upon Cardozosaw nonrescissionandnonmodifimarrying,

cation as happening automatically: in marrage, they have forborne.51Now why is the unity of the couple the key? In two ways. As a unit dealingwith the fatherbeforemarriage,they were

existing duty to confront. On that basis Cardozofelt he could

distinguish,freeingthe case from the gripof New Yorkprecedent against the recognitionof oblique contracts.And, being a free unit, they must have been induced in some degreeto marry,to become unfree, in relianceupon the father'sunilateralcontract

offer.52

A better saving case on behalf of oblique contracts than Cardozo'smustbe found.Forone thing,the partiesto the original on Cardozo'sapproachmust actuallyhavebeen treatedas a unit by the external offeror.If that had happenedin DeCicco,which is doubtful, it certainlydoes not happenin typical caseslike that of the Kentuckyjockey. Worsethan that, treatingthe co-contrac- tors of the originalagreementas a free bargainingunit is an attempt to show that therewas no pre-existingduty at all. That rendersCardozo'ssolution irrelevant,unless it containsa proof

that all apparentcases of pre-existingduty can be so explained away. But that is not possible.To make the solutionrelevantone has to have a pre-existingduty. Werethe affiancedcouple truly

free of a pre-existingduty to marryin dealingwith the father? ArthurCorbinsettled that question: "It servesno purposeto say

that they were 'freeto abandon'their if at the same engagement,

51 It may be largely a question of diction, but 'forbearance'was probably not the best word unless there was some contrary tendency to overcome. But Cardozodid arguethat therecould havebeen.

52 In ArthurL. Corbin,Corbinon Contracts(St. Paul:WestPub.Co., 1963) DeCicco is discussedin section 177 of volume IA, where Corbinclaims that

reasonablerelianceby the couple was enough to bind the father.

time ... neither one was free to abandon it. The fact that the

father made an offer to both of them has no effect whatever upon their individual duties to each other."53 If the couple were not legally free, then the pre-existing duty rule still applies to them, and Cardozo's attempt to free DeCicco from the New York prece- dents failed, in theory.

10. CORBIN'S ANALYSIS OF UNILATERAL CONTRACTS

OBLIQUELY MADE

McDevitt v. Stokes and DeCicco v. Schweizer were decided in the

same year, by different courts, in opposite ways. Arthur Corbin thought Cardozo's DeCicco decision was the correct one, in spite of the bad reasoning. Between the conclusion of the pre-existing duty debate in the Harvard Law Review in 1914 and Corbin's

largely satisfactory 1918 paper, Wesley Hohfeld introduced his method of analysis to his colleagues at Yale.54 Corbin's general argument, influenced by Hohfeld, can be restated as follows. In forming the oblique unilateral contract through the act of

executing the original contract, the pivotal B takes on no duty, surrendersno claim, and assumes no new liability to anyone. However, in forming an oblique unilateral contract, say by performing a contract of engagement to marry, two legal powers are surrendered, both of which existed because of the executory state of the

originalagreement.

The first power is the power to breach the original contract. Of course there is a legal duty not to breach; nonetheless, breach is a

53 Arthur Corbin, 'Does a Pre-existing Duty Defeat Consideration? - Recent

(New Haven: Yale Univ. Press, 1923). "No law-review article has ever achieved more complete or quicker success." Albert Kocourek,

Analytic Jurisprudence since John Austin" in Law: A Century of Progress vol. 2, ed. Alison Reppy (New York: New York Univ. Press, 1937), p. 207.

original contract he had "disposed of his right to refrain." But to lack the right to breach is not to lack the power to breach. That had not been dis- posed of. However, Joseph Raz has suggested to me that there is reason to doubt that a "legal power" to break a contract exists. Merely altering one's own position so as to change the legal powers of another and to change one's own liabilities, e.g., by not carrying through upon one's contractual promise, is not necessarily the exercise of a legal power, even though every such exercise will have that effect. Committing a criminal offence is not the exercise of a legal power, though it will probably alter one's own and others' legal posi-

merely doing something that one might not have done, even though one lacked both the legal power and right to do it.

56 Is there an objection to Corbin's "legal" argument in the observation that breaching one's original contract (and so failing to form the oblique unilateral) will also extinguish those powers, having the very same "detrimental" effect? The correct reply is this. First, when there is an oblique unilateral contract offer, one surrenders, by performance of the original, the power to breach in the manner requested in the offer. That a power must be finally lost does not

the point would seem to be that a variety of powers or rights exist or obtain as a result of the original contract's executory state, e.g., one has the privilege- right to appeal to the existence of one's existing contract to escape the pressure to make other further commitments. All the objection proves against Corbin is that any move away from the executory stage, e.g., by performance,

218 Richard Bronaugh

bin was quite happy to employ considerationsof benefit to the

fathei in DeCicco of being connected by marriageto an Italian noble family. But the pointis madethat one is not forcedto go to

It is to be gatheredfrom Corbin'sanalysisthat thereis a form of legal or normativedetrimentwhich may constitute logically sound consideration.57It was too readilyassumed,e.g., by Lang-

dell, Bennitt, and Williston,that, when the pivotalpartyperforms an originalcontract, there could be found no new oblique con- sideration other than by turning to valuable benefit for the promisor.One may now regardthat view as weakened,at leastas the exclusivebasisfor unilateralcontractsobliquelymade.

11. CORBIN'S ANALYSIS OF BILATERAL CONTRACTS

OBLIQUELY MADE

Legaldetriment,in its fallaciousemployment,makesits strongest appealin the case of the oblique bilateralcontract,for the seductive new duty seemsto emergeas considerationfor the promiseof the external party. Yet it may be noted that those who fell into the logical traphad probablyalreadyfallen in the caseof original contractstoo. Recallthat Langdellthoughtof two legaldetriments,

is sometimesexpressedalmost to imply as much: what more is givenin the formationof the new contractthan was givenin the old? Answer: more legal detriment. The idea of exchanging

promiseswill seem paradoxicalonly to those who, like Pollock,

58 See text for footnote 2.

Richard Bronaugh

obliqueunilateralcontractsthe only promiseis one made by the external on Corbin's hypothetical case of advancedpayment,the only promiseis madeby pivotalB. Corbin puts formationby executionupon the externalpartyA. Onemust imaginethat the jockey approachesthe breederwith a unilateral contractoffer. Thejockey promiseshim to ride,if he firstreceives

$1,000. The moneyis not givengratuitously.

This must be said. To allow that B is empoweredto extend to the externalpartyA a unilateralcontractoffer at all assumesthat

an acceptanceby A will be effective. Yet the questionat stakeis whether such powersexist in B givenB's pre-existingduty to C. So I do not findCorbin'sHohfeldianargumentcompelling.

It was not the firsttime thatCorbin'smaneuverhadbeentried.

when given for a performance, why should it be less binding when it is given in exchange for Peter's promise? There is no reason in the nature of the case for making any difference.60

This argumentwas used, as by Corbin,to supportthe idea of an oblique bilateralcontract. (Pollock, of course, would not allow the usualobliqueunilateralcontract,for want of detriment.)

Pollock's was discussedby DeanAshleyin his Lawof argument

Contracts,wherehe rejectedit: "If John canbindhimself,as Pollock contends,then thereis no difficulty,andhis promisewill sustain Peter's. But if he cannot do so, no money from Peter will enable him to change the situation."61 Indeed "what possible magic can there be in the payment of $5 which shall causethis non-existingpower to arise. If he cannot promise[in the pivotal

60 Sir F. Pollock, Principles of Contract, 7th ed. (London: Stevens, 1902) p. 188.

61 Ashley, The Law of Contracts, p. 107.

position] how can a payment of $5 give him this power?"62 For the same reason, I cannot see that Corbin made out his Hohfeldian

case.

The main part of Corbin's solution to the paradox is "to abandon the detriment theory of consideration altogether in the case of bilateral contracts."63 In support of this view, Corbin cited T. A. Street's argument found in The Foundations of Legal Liability.64 Street's reason for abandoning "detriment" is familiar in the context of this debate: detriment must be either "legal" (Langdell) or "the mere making of a promise" (Ames). Neither will do. Street concluded that "mutual consent" creates considera-

tion in every bilateral contract, rather than a detriment. It is clear that he meant here what one may call value detriment, and that Street's abandonment did not extend to consideration in unilateral contracts. Corbin accepted Street's bifurcation of rationales. The

(nondetriment) basis for a bilateral contract, whether oblique or not oblique, Corbin expressed this way.

Mutualpromisescreatea legalobligationbecause... the customarynotions of honor and well-being [and mutual assent and fair-dealing]cause men to performas they havepromised,and the law-makingpowershavedecreedthat

Employing customary notions of honor and fair-dealingas a non- circular solution to oblique bilateral contracts and to the general paradox of promissory exchange necessarily invokes moral beliefs and reasons for action. One may even record a nearmiss in Pollock, who wrote about oblique contracts: "a promise may obviously

distinct promise, creating on the face of it, a new and distinct duty