Though the nomenclature of these conditions is fixed as "conditions subsequent," the name should not cause it to be forgotten that except for purposes of pleading they are conditions precedent. 20 § 668. Express and implied conditions. Conditions may be created by the expressed assent of the parties thereto, or they may be created by the law without any manifestation of assent by word or act. An express condition is of the first type; a condition implied in law is of the second. Though these types of conditions in an extreme form are easily distinguished, they are often confused and confusion is the more natural because the two kinds shade into one another by imperceptible gradations. Conditions may be expressed not in the usual and appropriate language for conditions, but by the very nature of the thing promised. A promise to deliver goods necessarily involves the condition 84; Spencer v. Citizens' Mut. L. Assoc., 142 N. Y. 505, 37 N. E. 617; Mumaw v. Western &c. L. Ins. Co., 97 Ohio St. 1, 119 N. E. 132; Insurance Co. v. Crunk, 91 Tenn. 376, 23 S. W. 140; Troy Fire Ins. Co. v. Carpenter, 4 Wis. 20. See also Kidder v. Supreme Commandery, 192 Mass. 326, 78 N. E. 469. In Benanti v. Delaware Ins. Co., 86 Conn. 15, 17, 84 Atl. 109, Ann. Cas. 1913 D. 826, the court said: "It is no part of an insured's duty to negative a condition subsequent. The authorities are practically agreed in holding that the burden of proving the fraud is on the insurer. It is expressly provided, that if there appear any fraud or false swearing, the insured shall forfeit all claim under the policy. It is believed that an averment, that the plaintiff had practiced no fraud nor swore falsely, would sound rather oddly in the ears of a... special pleader;" citing: Schæffer v. Anchor M. F. Ins. Co., 113 Iowa, 652, 656, 85 N. W. 985; Friedman Co. v. Atlas Assurance Co., 133 Mich. 212, 94 N. W. 757; Slocovich v. Orient Mut. Ins. Co., 108 N. Y. 56, 14 N. E. 802; Western Assurance Co. v. Mohlman Co., 83 Fed. 811, 28 C. C. A. 157, 51 U. S. App. 577, 40 L. R. A. 561. 20 A misleading use of the term condition subsequent may be found in Thompson v. Insurance Co., 104 U. S. 252, 260, 26 L. Ed. 765. "We do not accept the position that the payment of the annual premium is a condition precedent to the continuance of the policy. That is untrue. It is a condition subsequent only, the non-performance of which may incur a forfeiture of the policy, or may not, according to the circumstances. It is always open for the insured to show a waiver of the condition, or a course of conduct on the part of the insurer which gave him just and reasonable ground to infer that a forfeiture would not be exacted. But it must be a just and reasonable ground, one on which the assured has a right to reply." Payment of the annual premium is certainly a condition precedent to liability on the insurer's promise. Of course, this condition precedent, like any other, may be waived. that the promisee will take delivery; a promise to repair another's house involves the condition that the promisor will be allowed access to the house. Such a condition may be called a condition implied in fact, or a necessary condition. It partakes of the nature of an express condition, except in the mode of proof.21 A step farther away from expressed intention to create a condition may be taken. A promise by one party to pay one hundred dollars, and a promise by the other party to transfer title to a horse, are in terms absolute and unconditional but if the promises were given in exchange for one another, the law will impose concurrent conditions on the ground that the performances must have been intended as the price each for the other, and that justice requires a concurrent exchange. Though this was not formerly the law, it has been so established for a century and a half, and modern business custom is in conformity with this rule of law. Therefore, at the present time a promise to sell not simply by rule of law, but presumably by the understanding of the parties is subject to a condition of contemporaneous payment unless a period of credit is expressly given. Thus it is true not only that custom gradually hardens into law but that a rule of law when once established and become familiar, is adopted in fact by the parties as a term of their bargain. 22 § 669. Importance of distinguishing between express and implied conditions. An express condition or a condition implied in fact, depends for its validity on the manifested will of the parties. It has the same sanctity as the promise itself. Though the court may regret the harshness of such a condition, as it may regret the harshness of a promise, it must nevertheless generally enforce the will of the parties unless to do so will violate public policy. Where, however, the law itself has imposed the condition, irrespective of the will of the parties, it can deal with its creation as it pleases, shaping the boundaries of the condition in such a way as to do justice and avoid hardship. 21 See infra, § 893. 22 See supra, § 615. § 670. Words necessary to create a promise. No form of words is necessary to create a promise or covenant; all that is essential is that on a fair interpretation it shall appear that the alleged promisor has agreed to do the act in question. 23 Not only may promises exist then, where the 23 In Hale v. Finch, 104 U. S. 261, 268, 26 L. Ed. 732, Harlan, J., for the court, said: "It is undoubtedly true, as argued by counsel, that neither express words of covenant, nor any particular technical words, nor any special form of words, is necessary in order to charge a party with covenant. 1 Roll. Abr. 518; Lant v. Norris, 1 Burr, 287; Williamson v. Codrington, 1 Ves. 511, 516; Courtney v. Taylor, 7 Scott, N. R. 749. 'The law,' says Bacon, 'does not seem to have appropriated any set form of words which are absolutely necessary to be made use of in creating a covenant.' Bac. Abr., Covenant, A. So in Sheppard's Touchstone, 161, 162, it is said: "There need not be any formal words, as 'covenant,' 'promises,' and the like, to make a covenant on which to 'ground an action of covenant, for a covenant may be had by any other words; and upon any part of an agreement in writing, in whatsoever words it be set down, for anything to be or not to be done, the party to or with whom the promise or agreement is made may have his action upon the breach of the agreement.' Mr. Parsons says, 'Words of proviso and condition will be construed into words of covenant, when such is the apparent intention and meaning of the parties.' 2 Parsons, Contracts, 23. There are also cases in the books in which it has been held that even a recital in a deed may amount to a covenant. Farrall v. Hilditch, 5 C. B. (N. S.) 840; Great Northern Railway Co. v. Harrison, 12 C. B. 576; Severn and Clerk's Case, 1 Leon. 122. And there are cases in which the instrument to be construed was held to contain both a condition and a covenant; as, 'If a man by indenture letteth lands for years, provided always, and it is covenanted and agreed between the said parties, that the lessee should not alien.' It was adjudged that this was 'a condition by force of the proviso, and a covenant by force of the other words.' Co. Litt. 203 b. But according to the authorities, including some of those above cited, and from the reason of those above cited, and from the reason and sense of the thing, a covenant will not arise unless it can be collected from the whole instrument that there was an agreement, or promise, or engagement, upon the part of the person sought to be charged, for the performance or non-performance of some act. Comyns, in his Digest (Covenant, A, 2), says that, 'any words in a deed which show an agreement to do a thing, make a covenant,' 'but,' says the same author, 'where words do not amount to an agreement, covenant does not lie; as, if they are merely conditional to defeat the estate; as, a lease, provided and upon condition that the lessee collect and pay the rents of his other houses.' Comyns, Dig., Covenant A, 3. The language last quoted is found also in Platt's Treatise on the Law of Covenants. Law Library, vol. iii. p. 17. It there appears in connection with his reference to the case where A. leased to B. for years, on condition that he should acquit the lessor of ordinary and extraordinary charges, and should keep and leave the houses at the end of the term in as good plight as he found them. In such case, the author remarks, the language is in terms that of promise, but also where the agreement shows that the parties must have intended an obligation though they failed so to state in clear terms. These promises implied in fact, as they may be called, are numerous. A notable example is that of a bond. "Until well after Lord Coke's time the only consequence of breaking the condition of a bond was an obligation to pay the penalty. The obligor was held to have an election between performing the condition and payment. " 24 "It seems to have been held within half a century after Hulbert v. Hart, that, under some circumstances at least, a bond would be construed to import a promise of the event constituting the condition." 25 This illustration of words not strictly appropriate for a promise being construed as such, is an extreme one, for the conclusion seems based on the necessity of finding a justification for limiting the damages on the bond to the actual injury suffered by breach of the condition. 26 Debt for the penal sum not covenant for non-performance of the condition remained the ordinary remedy and "the practice of recovering damages beyond the penalty of a money bond is unknown, a condition of things which could hardly exist if covenant would lie on such an agreement.' Clearer cases of promises implied in fact are the promises implied in every bilateral contract not only not to prevent performance by the other party of the performance by which he will become entitled to receive counter performance, but also to coöperate in such performance if coöperation is necessary from the nature of the case. 28 In a contract to buy and sell, each party thus binds himself to accept the performance of the other even if he does not in terms agree to do so. lessee was held liable to an action for omitting to leave the houses in good plight, 'for here an agreement was implied."" 24 Stewart v. Griffith, 217 U. S. 323, 328, 54 L. Ed. 782, by Holmes, J., citing: Bromage v. Genning, 1 Roll. R. 368; 1 Inst. 206 b; Hulbert v. Hart, 1 Vern. 133 (1682). 25 Ibid., citing: Hobson v. Trevor, 1 Strange, 533, S. C., 2 P. Wms. 191 (1723); Anonymous, Moseley, 27 (1728); Roper v. Bartholomew, 12 19 27 Price, 797, 811, 822, 826, 832; Hooker v. Pynchon, 8 Gray, 550, 552. See also Martin v. Taylor, 1 Wash. C. C. 1; New Britain v. New Britain Tel. Co., 74 Conn. 326, 50 Atl. 881, 1015; Philbrook v. Burgess, 52 Me. 271; Clark v. Bush, 3 Cow. 151; Douglas v. Hennessy, 15 R. I. 272, 3 Atl. 213, 7 Atl. 1, 10 Atl. 583. 26 See infra, § 774. 27 Sedgwick on Damages, § 679. See also infra, § 1414. 28 See infra, § 1293. a Whether one who has made a conditional promise undertakes impliedly to make the condition possible, depends on reasonable inferences to be drawn in each case. One who promises to pay for a business or a franchise a percentage of the profit realized therefrom must generally be understood to promise impliedly that he will continue to exercise the business from which the profit is to be derived. 28 A promise to pay wages when the employer resumed work or disposed of his property was held to imply an obligation to do one or the other within a reasonable time.29 A promise to pay when money was collected from adjoining owners implied an undertaking that the promisor was in a position to collect it and would do so.294 Promises to pay when able on the other hand are not usually held to imply a promise to become able; 30 and the retainer of a lawyer coupled with a promise to pay him a further sum if his services are required implies no promise to require them.31 § 671. Words necessary to create a condition. Any words will create a condition which express, when properly construed, the idea that the performance of the promise is dependent on some other event. "For the most part conditions have conditional words in their frontispiece and do begin therewith." 32 The early cases on conditions relate generally to estates in land, but the principles involved are the same as in covenants or promises. In the early books there are said to be three words most proper for the purpose: proviso, ita quod, and sub conditione; but there are also other appropriate words as-si, or si contingat.33 A great variety of words are now regarded as equally fit for the creation of a condition. Not only those mentioned above, but such words as "when, "after," or "as soon as," clearly indicate that the promise is not to be performed except upon a condition. Whether a present participle makes an express condition has involved 28a McIntyre v. Belcher, 32 L. J. C. P. (N. S.) 254; In re Railway & Electric Appliances Co., 38 Ch. D. 597, 603. 29 Hood v. Hampton Plains Co., 106 Fed. 408. 294 Worthington v. Sudlow, 21 L. J. Q. B. (N. S.) 131. 30 See infra, & 804. 31 See further, infra, § 1015. 32 Sheppard's Touchstone, 121. |