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been made may depend upon whether certain admitted acts are to be attributed to the performance of a previous obligation or to the creation of a new one, and this in turn may depend on apparent if not actual intention-not, however, intention to relinquish a right, but intention to continue performance of the old obligation. 53

§ 685. Whether knowledge of facts is essential for election. Though no element of promissory estoppel may be necessary to constitute a binding election, such an element frequently, if not usually, exists. The choice of an alternative right by one entitled thereto will often be followed by action of the other party based on justifiable reliance upon the apparent attitude of the former; or at least the situation of the parties will be so materially changed as to make a new choice unfairly prejudicial. Where either of these circumstances exists, knowledge of facts by the party entitled to choice should not be necessary to make the election binding.54 Where, however, neither circumstance enters into the case an election should not be binding without either actual knowledge or blameworthy ignorance of the material facts. The principle of election is an equitable one and unless the other party has been deceived or the situation changed it is inequitable to regard a choice as final unless the party having the right of election was aware, or should have been aware, of all material facts making one

53 In Alsens &c. Cement Works v. Degnon Contracting Co., 222 N. Y. 34, 118 N. E. 210, the defendant was entitled by contract to 175,000 barrels of cement to be ordered before March 1, at $1.41 a barrel, 36,000 barrels had not been ordered prior to March 1, but 1900 barrels were ordered and supplied between that date and the ensuing May. The seller claimed the market value for these barrels on the ground of a new implied contract. The buyer contended that he was liable for only the contract price of $1.41. The court rightly held the question one of fact, but held that the jury must determine whether the intention to

waive existed. It seems clear that the
only issue was whether the 1900 barrels
were furnished under the old contract
or not. If they were no intention or
lack of intention to waive could en-
title the seller to more than $1.41 a
barrel. Whether they were or not
was a question of fact, not depending
on the seller's intention alone, but on
the apparent intention of both.
the buyer clearly ordered them under
the old contract, the seller though jus-
tified in refusing the order could not
fill it and then assert that he intended
to do something different from what
the buyer requested.

54 See the preceding section.

If

55 In Dushane v. Beall, 161 U. S. 513, 40 L. Ed. 791, 16 S. Ct. 637, the question concerned the right of election of an assignee in bankruptcy to take or reject onerous property belonging to the bankrupt. It was held that in the absence of knowledge by the assignee of the existence of the property in question, his conduct in failing to reduce it to possession could not be regarded as an election to refuse the property and allow the bankrupt to retain it.

choice desirable or the reverse.55 It is often stated in positive terms that knowledge of facts is necessary; 56 but blameworthy ignorance is sufficient; 57 and it is better to say so plainly than to indulge in a fictitious conclusive presumption of knowledge." ments it had no knowledge that Mosiman was sick when he paid them, but it did know that the certificate of health which it had a right to require had not been furnished, and in waiving the prescribed showing in that regard it waived all inquiry into the member's physical condition. Of course, if it had been misled by any false representation or fraudulent concealment a different situation would be presented. Spitz v. Mutual Ben. Life Assn., 25 N. Y. S. 469, 472, 5 N. Y. Misc. 245; Rice v. New England Mutual Aid Soceity, 146 Mass. 248, 15 N. E. 624." In Knights of Pythias v. Kalinski, 163 U. S. 289, 298, 41 L. Ed. 163, 16 S. Ct. 1047, the court said: "The continued receipt of assessments upon Kalinski's certificate up to the day of his death was a waiver of any technical forfeiture of the certificate by reason of the non-payment of the lodge dues. Granting that the continued receipt of premiums or assessments after a forfeiture has occurred will only be construed as a waiver when the facts constituting a forfeiture are known to the company, Insurance Co. v. Wolff, 95 U. S. 326, 24 L. Ed. 387; Bennecke v. Insurance Co., 105 U. S. 355, 26 L. Ed. 990, this is true only of such facts as are peculiarly within the knowledge of the assured. If the company ought to have known of the facts, or with proper attention to its own business, would have been apprised of them, it has no right to set up its ignorance as an excuse." See also infra, § 720.

56 "Acquiescence and waiver are always questions of fact. There can be neither without knowledge. The terms import this foundation for such action. One cannot waive or acquiesce in a wrong while ignorant that it has been committed. Current suspicion and rumour are not enough. There must be knowledge of facts which will enable the party to take effectual action." Pence v. Langdon, 99 U. S. 578, 581, 25 L. Ed. 420. See also Lindquist v. Dickson, 98 Minn. 369, 107 N. W. 958, 6 L. R. A. (N. S.) 729, 8 Ann. Cas. 1024; Georgi v. Texas Co., 225 N. Y. 410, 122 N. E. 238.

57 In Mosiman v. Benefit Association, 82 Kans. 670, 674, 109 Pac. 413, the court said, in speaking of the effect upon an insurance contract already in default, of receiving payment of an assessment: "It has been held under similar circumstances that the acceptance of payment from a member under suspension, without knowledge of his illness, cannot effect a waiver. Knights of Pythias v. Quinn, 78 Miss. 525, 29 So. 826; United Order of the Golden Cross v. Hooser, 160 Ala. 334, 49 So. 354. We do not find the reasoning convincing. True, when the association accepted the delinquent assess

58 In Pabst Brewing Co. v. Milwaukee, 126 Wis. 110, 117, 105 N. W. 563, the court said: "It is suggested that there can be no waiver without intent to waive based on knowledge of the facts. True, but one is presumed to

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§ 686. What manifestation of election is final.

The question when election of one of two inconsistent courses has gone so far as to preclude subsequent choice of the second course when the first proves ineffectual, is raised in several classes of cases. If the change from the first alternative to the second involves any substantial injury to the other party, clearly the change ought not to be permitted: but frequently there is no such injury; yet there has been a plain manifestation of the choice of one course rather than the other. Thus one whose goods have been converted may make a demand for the proceeds of the converted property, thereby indicating a choice to affirm the wrongdoer's action. This is ordinarily called an election of remedies merely; but the choice of remedies is also a choice of rights. Though it has been said by high authority that as soon as a party having a right of election "has communicated it to the other side in such a way as to lead the opposite party to believe that he has made that choice, he has completed his election and can go no further," 59 such a demand has been held, not to preclude a subsequent election to enforce the claim in tort.60 On the other hand, prosecuting the claim to judgment is a final election.61 Even bringing an action is by some courts held conclusive.62 The same sort of question arises where one entitled to sue either for

know that which in contemplation of law he ought so know, and one is presumed to waive that which is necessarily implied from his conduct. Constructive as well as actual knowledge of the facts, and implied as well as express intent, satisfies the prime essential of a conclusive waiver." In Reed v. Union L. Ins. Co., 21 Utah, 295, 309, 61 Pac. 21, the court said: "It is said that the plaintiff was bound to know the law, and that he must have known the facts. So far as the written contract alone was concerned, if not ambiguous or contradictory, this may be true."

59 Lord Blackburn in Scarf v. Jardine, 7 App. Cas. 345, 360.

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Baker v. Hutchinson, 147 Ala. 636, 41
So. 809.

61 Hitchin v. Campbell, 2 W. Bl. 827; Bacon v. Moody, 117 Ga. 207, 43 S. E. 482; Roberts v. Morse, 127 Ky. 657, 106 S. W. 297; Ware v. Percival, 61 Me. 391, 14 Am. Rep. 565; Walsh v. Chesapeake, etc., Canal Co., 59 Md. 423; Nanson v. Jacob, 93 Mo. 331, 6 S. W. 246, 3 Am. St. Rep. 531; International Paper Co. v. Purdy, 136 N. Y. App. Div. 189, 120 N. Y. S. 342.

62 Daniels v. Smith, 15 Ill. App. 339; Thomas v. Watt, 104 Mich. 201, 62 N. W. 345; Carroll v. Fethers, 102 Wis. 436, 78 N. W. 604. See, however, contra-Spurr v. Home Ins. Co., 40 Minn. 424, 42 N. W. 206; Otto v. Young, 227 Mo. 193, 127 S. W. 9.

breach of an express contract or for the fair value of what has been given under it 63 manifests a choice of one or the other remedy. Thus, taking judgment is a conclusive choice,64 and even beginning an action is generally held conclusive.65 Beginning a suit for specific performance has also been held an election by the plaintiff (the vendee) to proceed with the contract, in spite of all defects in the title then known to him.66 Any conduct calculated to deceive the other party to his injury in regard to the choice of the party entitled to elect will also conclude the latter.67 Similarly proof in bankruptcy by a secured creditor of the full face of his claim is an election to surrender the security.68 And where one who enters into a contract is acting for an undisclosed principal, the other party on discovering the facts is put to his election whether he will hold the agent or the principal.69 According to the generally accepted statement of a promisee's rights on repudiation by the promisor of his obligation under a bilateral contract, the promisee has an election to treat the repudiation as a breach or not to do so.70 The result of the decisions on the subject seems rather inconclusive of the question whether a manifestation of election is final unless a change from the alternative first chosen will work, or may work, an injury to the other party. Perhaps a rule might find support, both on principle and from convenience that after any manifestation of election an inconsistent position cannot be taken as matter of right, but that unless consideration has been given or there is an element of estoppel, a court having equitable powers may relieve from a hard situation by allowing rescission of the election.71

63 See infra, § 1454.

64 Goodman v. Pocock, 15 Q. B. 576; Graham v. Holloway, 44 Ill. 385.

65 Brown v. St. Paul, etc., Ry. Co., 36 Minn. 236, 31 N. W. 941; Graves v. White, 87 N. Y. 463. See also Theusen v. Bryan, 113 Ia. 496, 85 N. W. 802; Holman v. Updike, 208 Mass. 466, 94 N. E. 689.

66 Gray v. Fowler, L. R. 8 Exch. 249. 67 Mizell v. Watson, 57 Fla. 111, 49 So. 149; Harden v. Lang, 110 Ga. 392,

36 S. E. 100; Axtel v. Chase, 77 Ind. 74; Mills v. Osawatomie, 59 Kans. 463, 53 Pac. 470; Graham v. Hatch Storage Battery Co., 186 Mass. 226, 71 N. E. 532; J. B. Alfree Mfg. Co. v. Grape, 59 Neb. 777, 82 N. W. 11.

68 First Nat. Bank v. Exchange Nat. Bank, 179 N. Y. App. D. 22, 153 N. Y. S. 818, 164 N. Y. S. 1092.

69 See supra, § 289.
70 See infra, § 1322.

71 On the right to make a new elec

§ 687. Acceptance of continued benefits under a contract with knowledge of a defence is an election; leases. The commonest case of election in the law of contracts arises where, with knowledge of a breach of condition or a defence excusing performance, a promisor either refuses or continues to accept performance from the other party. As the only theory upon which the benefit of such performance can be rightfully received is on the assumption of an election to continue the contract, that assumption is made if the injured party accepts further performance. This principle was early established in the law of landlord and tenant. Acceptance of rent accruing after breach of condition with knowledge of the breach is a discharge of the breach.72 The principle of election precludes a purchaser in possession of real estate under a contract from refusing to make payments under the contract

tion after bringing action, in cases of waiver of tort, see Woodward, QuasiContracts, § 298; Griffith, Election of Remedies, 15 L. Quar. Rev. 160; Corbin, Waiver of Tort and Suit in Assumpsit, 19 Yale L. J. 221, 239. See also infra, §§ 1469, 1526-1528. In a case of a different character the theory has been adopted that some change of position in reliance on an election is necessary to make it final. In List & Son Co. v. Chase, 80 Oh. St. 42, 49, 88 N. E. 120, the court said: "Mere silence will not amount to waiver where one is not bound to speak. In this case the goods were perishable and exceedingly liable to be damaged by heat. The shipment was in the month of June and therefore the shortest and speediest route was a material condition. It is true that if the contract bound the plaintiff to ship by such a route, the defendant might have rescinded the contract on receiving the bill of lading showing a shipment on another and more hazardous route; but he was not bound to do so then. He might wait until inspection because inspection might show that the goods were not damaged, and he could

then accept them or if damaged reject them. The purchaser therefore waived no right by waiting and the seller lost none, because the latter had already made a breach of his contract and could not remedy it." While the principle that an election may be open to change, if the change works no injury to the other party, seems sound, it may be questioned whether the court did not go too far here in suggesting that the buyer might throw the risk of transit on the seller by deferring his election. True the seller had already irretrievably broken his contract, but the consequences of that breach would vary with the position which the buyer took; and it seems unfair to allow him to say "I will take neither position now, but will wait and see which is more advantageous to me (and more disadvantageous to you)." See infra, n. 80.

72 Marsh v. Curteys, Cro. Eliz. 528; Harvie v. Oswel, Cro. Eliz. 572; Dendy v. Nicholl, 4 C. B. (N. S.) 376; Cotesworth v. Spokes, 10 C. B. (N. S.) 103; Ward v. Day, 4 B. & S. 337; Commercial Trust Co. v. L. Wertheim &c. Co., 88 N. J. Eq. 143, 102 Atl. 448.

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