shipper cannot recover the proceeds from the master if he knew of the license, otherwise if he did not know of it.13

But the Courts will not enforce an accounting for the fruits of a past illegal transaction against a confederate or agent in possession of the same, when the illegal means by which they were originally acquired were a malum in se and characterized by moral turpitude, as distinguished from a mere malum prohibitum, and both parties participated in the wrong.1 "The sentiment of honor among thieves cannot be enforced in Courts of justice."15

14

The

In a case where plaintiff and defendant were engaged jointly in the manufacture and sale of certain machines, it was alleged that many of the sales were effected by the bribery of municipal officers and other corrupt means. parties could not agree upon a settlement, and plaintiff filed a bill for an account and the payment to him, under the agreement between the parties, of one-half of the net profits arising from sales effected, corruptly, as alleged by one of the parties, as well as other sales to which no objection was made. The Court said:16 "When you come to consider whether you will enforce an accounting for the fruits of an illegal transaction, the question of the degree of guilt, the question of moral turpitude or not, the question of exemplary effect upon the public mind-in short, of public policy-will of necessity materially influence the decision. *** The practical test to determine the Court in either giving or refusing an account to one of the parties to a past and completed illegal contract as against another is, after all, public policy, and in the application of that test, the Court will look at the circumstances of the particular venture, and at the more or less pernicious and demoralizing effect of the example afforded by its successful prosecution."

13 Chappell v. Wysham, 4 H. & J. 560. Cf. Stewart v. McIntosh, 4 H. & J. 23.

14 Croft v. McConoughy, 79 III. 336; Daniels v. Barney, 22 Ind. 207; Green v. Corrigan, 87 Mo. 359; Overby v. Overby, 21 La. An. 493; Jackson v. McLean, 36 Fed. Rep. 213; Edgar v. Fowler, 3 East, 222.

15 Woodworth v. Bennett, 43 N. Y. 277.

16 Phelps, J., in Prunty v. Basshor, in Circuit Court of Baltimore City, Daily Record of May 11th, 1889.

It will be seen, therefore, that the distinction between malum prohibitum and malum in se, which is not important when the mere question of the legality of the contract is concerned, is on the other hand a controlling consideration in determining whether an accounting can be had of the fruits of a past illegal transaction.

VOID, VOIDABLE, AND UNENFORCEABLE CONTRACTS

§ 110. The lack of one or more of the requisites of a valid contract as set forth in the foregoing chapters may render the agreement of the parties wholly void, or voidable, or merely unenforceable.

An unenforceable contract is one which is valid, but incapable of proof or legal enforcement, as contracts within the Statute of Frauds where the requirements of the statute have not been met. If executed it is a good defense.1

A voidable contract is one capable of being avoided or affirmed at the option of one of the parties, such as the contracts of infants, contracts obtained by fraud, undue influence, etc. The ratification of a voidable contract with knowledge of the facts operates as a renunciation of the right to attack it, and so gives it legal effect from the beginning, according to the maxim omnis ratihabitio retrotrahitur.2

A void contract is one destitute of legal effect. In such case one may say-nullum est negotium, nihil actum est. The parties have seemed to make a contract, but they have not done so. What has taken place is as if it were not-e. g., a contract made under a mistake as to the existence of the subject-matter. And no rights can be acquired under a void

contract.

It is generally said that a void contract cannot be ratified. So it has been held that a deed of confirmation cannot work upon an estate void at law; that the power of attorney of an infant being void cannot be ratified by him after attaining

1 Crane v. Gough, 4 Md. 317; Baker v. Lauterbach, 68 Md. 70.

2 See ante, ch. vii.

3 Blessing v. House, 3 G. & J. 290, note; Gable v. Williams, 59 Md. 54.

majority; that a deed of property executed by a trustee in equity before ratification of the sale and payment of the purchase money is an absolute nullity, which cannot be waived; that signing a bill of exceptions by a judge after the expiration of his term of office is a void act, to which no agreement of counsel can give validity; that an illegal contract cannot be ratified."

8

To be and not to be are absolute contraries, and hence logic seems to demand that a void contract should be absolutely such, and remain wholly without effect. But this is not always the case. An illegal contract, for instance, is void, yet money paid under it cannot be recovered back. Sometimes the transaction must be judicially declared void, as in the case of a marriage within the prohibited degrees." And a void contract may be ratified when the ratification occurs under circumstances permitting a valid contract to be made. So it is said in a recent case, "that sales either voidable or void may be ratified by the acts of the parties in interest. They may be ratified either directly, or by a course of conduct which will estop the party from denying their validity."10 It would seem that the ratification of a void act should be conceived of as an estoppel, or as to the making of a new contract of similar import. Questions may arise as to the retroactive power of such ratification.

4 Wainwright v. Wilkinson, 62 Md. 147.

5 Johnson v. Hines, 61 Md. 122.

6 State v. Weiskittle, 61 Md. 48.

7 U'. S. v. Grossmayer, 9 Wall. 72; Troewert v. Decker, 51 Wis. 49; Boutelle v. Melendy, 19 N. H. 196.

8 Dernburg, Pandekten, 1. 120.

9 Harrison v. Harrison, 22 Md. 468.

10 Long v. Long, 62 Md. 71.

Windscheid (Pandekten, sec. 82, and n. 10), discusses the ratification of a void act. He points out that as confirmation it can have no effect since no additional life can be given to that which does not exist, but it can only operate as the new creation of a contract of similar effect. He admits, however, that Justinian's legislation certainly recognizes the ratification of void acts. "According to the prevalent opinion the ratification of a void act operates only as the making of a new act, and consequently lacks retroactive power. I repeat that legal consistency certainly demands this, only it must be added that the ratifier is bound so to act as if the effect of the newly concluded agreement had earlier become operative."

PART III

EFFECTS OF THE CONTRACT

CHAPTER I

PRIVITY OF CONTRACT

§ 111. Imposing Liabilities. The agreement of two parties resulting in a contract, creates a personal relation between them, and that agreement cannot impose any liability upon a third person. In some instances however, a man is erroneously led to think that, because as a result of his contract with A. he has conferred a benefit upon C., he has a claim against C. But that is neither the law nor the reason of the matter. If you pay my debts voluntarily and officiously, that gives you no claim against me.1 If I order goods from A. or work to be done by him, and he engages you to do the work or to supply the goods, you have no right of action against me in case A. fails to comply with his contract to pay you.

The defendants employed a firm of brokers to transport some cocoa from London to Amsterdam. The brokers employed the plaintiff to transport the cocoa which was done by him without the defendants being aware of the fact. The defendants refused to pay plaintiff upon the ground that they had entered into no contract with him, and it was held that they were not liable because there was no privity between them and the plaintiff.3

While a

§ 112. Inducing a Party to Break a Contract. contract between A. and B. cannot be made in itself to impose any liability upon a third person, yet that contract creates rights between A. and B. which third persons are bound to

1 Dougherty Co. v. Gring, 89 Md. 535.

2 Carroll v. Benedictine Society, 88 Md. 317.

3 Schmaling v. Thomlinson, 6 Taunt. 147.

respect. The agreement is a fact which imposes a duty upon those who have knowledge of it. The rule is that a person who knowingly and without just cause induces one of the parties to a contract, to break it, is liable in an action to the other party for an injury so occasioned.1

"The right to dispose of one's labor as he will, and to have the benefit of one's lawful contract, is incident to the freedom of the individual which lies at the foundation of the government in all countries that maintain the principles of civil liberty. Such right can lawfully be interfered with only by one who is acting in the exercise of an equal or superior right which comes in conflict with the other. An intentional interference with such a right, without lawful justification, is malicious in law, even if it is from good motives and without express malice."2

"Malice in the sense of evil motive or personal ill will is not a necessary condition to make procuring a breach of contract a wrong, actionable at the suit of the contracting party who thereby suffers damage. *** The word malice is better kept out of such cases altogether."3

A declaration sets forth a good cause of action which alleges that the plaintiff was the owner of certain houses and lots; that the defendant obtained a mortgage thereon from a person whom he knew not to be the owner, and knowing that the mortgage was fraudulent and void caused the tenants of the property to cease paying their rents to the plaintiff, and advertised the property for sale under an ex parte

1 Knickerbocker Ice Co. v. Gardiner Dairy Co., 107 Md. 556; Angle v. Chicago, etc., R. Co., 151 U. S. 1; Read v. The Friendly Socity [1902], 2 K. B. 732; Lumley v. Gye, 2 Ellis & B. 216; Bowen v. Hull, 6 Q. B. D. 383; Walker v. Cronin, 107 Mass. 555; Jones v. Stanley, 76 N. C. 355; Raymond v. Yarrington, 96 Tex. 443: Doremus v. Hennessy, 176 Ill. 608; 43 L. R. A. 797. Contra: Glencoe Co. v. Com. Co.. 138 Mo. 439: Chambers v. Baldwin, 91 Ky. 121; 11 L. R. A. 545; Boyeson v. Thom, 98 Cal. 578. See notes appended to Thacker Coal Co. v. Burke, 5 L. R. A. (N. S.), 1091; Knickerbocker Co. v. Gardiner Co.. 16 L. R. A. (N. S.) 747, and Curran v. Galen, 152 N. Y. 33. 2 Berry v. Donovan, 188 Mass. 356.

3 South Wales Miners Fed. v. Glamorgan Coal Co. [1905], App. Cas. 239.