§ 842. Substantial performance. The principle of part performance in dependent promises may be expressed either by saying that a breach which is Since the defendant's breach of contract prevented the earnings of the book from measuring the payment for them, as the contract had provided, the full sum was recoverable. The court said (p. 29): "If a covenant by one party goes to the whole consideration of a promise by the other party its performance is a condition precedent to the right to enforce the promise; but if it goes only to a part of the consideration, the promise of the other party may be enforced without performance of the covenant, the other party being left to his right to recover damages for non-performance of the covenant. Mill Dam Foundry v. Hovey, 21 Pick. 417, 439; Boyle v. Guysinger, 12 Ind. 273; Coe v. Bradley, 5 Fed. Cas. 1170, case No. 2941; Water Lot Co. v. Leonard, 30 Ga. 560, 573; Dey v. Dox, 9 Wend. 129, 24 Am. Dec. 137." In New Jersey, etc., Trust Co. v. Parker, 85 N. J. Eq. 557, 96 Atl. 574, by an antenuptial agreement a prospective husband agreed to leave by will to his intended wife certain securities if she kept her promise to marry him. They were married but several years later she left him and obtained a divorce on grounds not recognized in New York where the contract was made. Later the husband died and bequeathed the securities to another. It was held that the wife could not claim them under the ante-nuptial agreement. Even if it be granted that the wife's promise included an implied obligation to continue a wife unless released by a law like that of New York, the part performance seems to have warranted a different conclusion from that reached by the court. See the criticism in 29 Harv. L. Rev. 881. In Casavant v. Sherman, 213 Mass. 23, 26, 27, 99 N. E. 475, the court said, speaking of a contract of employment: "The stipulations of the parties to the contract were mutual and dependent, and if, after it had been partially executed, the defendant by discharging the plaintiff made further performance impossible, he is liable in damages, unless the discharge could be justified on the ground of the plaintiff's defaults. Hodgkins v. Moulton, 100 Mass. 309; Hapgood v. Shaw, 105 Mass. 276; Earnshaw v. Whittemore, 194 Mass. 187, 192, 80 N. E. 520. It is settled that, while inadvertent or unimportant departures would not defeat the right of recovery, the plaintiff became bound to a substantial performance in furtherance of the objects intended to be accomplished. Eastern Forge Co. v. Corbin, 182 Mass. 590, 592, 66 N. E. 419, National Machine & Tool Co. v. Standard Shoe Machinery Co., 181 Mass. 275, 63 N. E. 900.... "The jury were to determine whether the various acts of omission had been proved, and, if proved, they were further to decide whether when viewed as a whole, even if any one of them might have been insufficient, the defects in performance reasonably warranted the inference that the plaintiff would not or could not properly exert himself in the promotion of the defendant's interests. Chapman v. Coffin, 14 Gray, 454; Cabot v. Winsor, 1 Allen, 546; Cunningham v. Washburn, 119 Mass. 224." See also University Club v. Dakin, 265 Ill. 257, 106 N. E. 790, L. R. A. 1915 C. 854; Dudley v. Wye, 230 Mass. 350, 119 N. E. 790; Rosenthal Paper Co. v. National &c. Paper Co., 226 N. Y. 313, 123 N. E. 766. material, or which goes to the root of the matter, or essence of the contract, is fatal to the plaintiff's case in spite of his part performance; or it may be expressed by saying that a plaintiff, who has substantially performed, is entitled to recover, although he has failed in some particular to comply with his agreement. The latter mode of expression is especially common in building contracts and, as has been pointed out in a previous section, 49 even where the promise of the owner is qualified by an express condition which has not been complied with, the contractor is frequently allowed to recover if his breach of contract is not very great and is not wilful. Such authorities show a fortiori, that a contractor may recover where there is no such expressed condition, and the owner's only defence is a comparatively slight breach of the builder's dependent promise.50 The same principles which are applicable to building contracts must be applicable to other contracts where there is part performance of which the benefit enures to the defendant.51 Though the wilfulness of the breach, if it exists, is an important element in the case, 50 In addition to the cases cited in § 805 see-Morris v. Hokosona, 26 Col. App. 251, 143 Pac. 826; Pratt v. Dunlap, 85 Conn. 180, 82 Atl. 195; Fagerholm v. Nielson, (Conn. 1919) 106 Atl. 333; Littell v. Webster County, 152 Iowa, 206, 131 N. W. 691; Mitchell v. Spurrier Lumber Co., 31 Okl. 834, 124 Pac. 10; Wiebener v. Peoples, 44 Okl. 32, 142 Pac. 1036; Edmunds v. Welling, 57 Or. 103, 110 Pac. 533; Gessler v. Graham, 234 Pa. 586, 83 Atl. 429; Pressey v. McCormack, 235 Pa. 443, 84 Atl. 427; Smith v. Cunningham Piano Co., 239 Pa. 496, 86 Atl. 1067. But see contra Harris v. Westholme, 12 D. L. R. (Canada) 640. 51 Leiston Gas Co. v. Leiston-CumSizewell Council, [1916] 1 K. B. 912; La Follette v. La Follette Water &c. Co., 252 Fed. 762, 164 C. C. A. 602; Turner v. Mellier, 59 Mo. 526; International Signal Co. v. Marconi Wireless Tel. Co. (N. J. Eq.), 104 Atl. 378; Cramp 52 ton v. McLaughlin Realty Co., 51 Wash. 525, 99 Pac. 586. In Northwestern Theatrical Association v. Hannigan, 218 Fed. 359, 134 C. C. A. 167, the action was on an agreement by the defendant, a manager of theatres, to pay for the sole representation in certain cities of a theatrical attraction. Though the court held that on the facts of the case no recovery on the theory of substantial performance was possible it did not question the applicability of the doctrine if the facts had warranted it. To the same effect are Gerber v. Kalmar, 104 N. Y. Misc. 85, 171 N. Y. S. 92; Bookhout ". Vuich, 101 Wash. 511, 172 Pac. 740. See also supra, § 838, and § 49 ad fin. 52 In Sipley v. Stickney, 190 Mass. 43, 76 N. E. 226, 5 L. R. A. (N. S.) 469, 112 Am. St. Rep. 309, the court apparently lay down the principle that any wilful breach, whether going to the essence or not is fatal to recovery on the contract; but in the good faith will not justify recovery on a contract by a plaintiff who has committed a material breach.53 § 843. Benefit derived by the defendant from the plaintiff's part performance. An important element in determining whether part performance rendered by the plaintiff makes it unfair to allow the defendant to refuse to go on with the contract, is the benefit or lack of benefit derived by the defendant from the part performance. It has been stated on high authority that the reason for the doctrine compelling the defendant to continue with the contract after part performance "besides the inequality of damages, seems to be, that where a person has received part of the consideration for which he entered into the agreement, it would be unjust that, because he had not the whole, he should therefore be permitted to enjoy that part without either payment or doing anything for it." 54 actual case there was not only wilfulness but dishonesty-certainly a material breach. Peterson v. Mayer, 46 Minn. 468, 45 N. W. 245, 13 L. R. A. 72. See infra, § 1022. The Massachusetts court repeated the statement in Mark v. Stuart-Howland Co., 226 Mass. 35, 43, 115 N. E. 42. It is pretty severe doctrine that any conscious deviation from the contract of however slight importance is fatal to recovery upon it, even though there is no express condition. The question must to some extent be one of degree. 53 Cresswell Co. v. Martindale, 63 Fed. 84, 11 C. C. A. 33. 4 Parke, B., in Graves v. Legg, 9 Exch. 709. In that case the court held that the failure of the seller of a cargo of wool to declare at the time of shipment the names of the vessels in which the wool was shipped was fatal to recovery, and the court emphasized the fact that no benefit was taken by the defendant under the contract itself. So in Kauffman v. Raeder, 108 Fed. 171, 177, 47 C. C. A. 278, San born, J., said: "When a contract has been partially executed, and one of the parties has derived substantial benefits or has imposed upon the other material losses through the latter's partial performance of the agreement, then the first party cannot rescind the contract on account of the failure of the second party to complete his performance, but the agreement must stand, the first party must perform his part of it, and his only remedy for the failure of the second party to completely perform is compensation in damages for that breach. German Sav. Inst. v. DeLa Vergne Refrigerating Mach. Co., 70 Fed. 146, 150, 17 C. C. A. 34, 38, 36 U. S. App. 184, 190; 1 Chit. Pl. (16th Am. Ed.) * 333; Barbee v. Willard, 4 McLean, 356, 359, Fed. Cas. No. 969; Hunt v. Silk, 5 East, 449; Hammond v. Buckmaster, 22 Vt. 375; Brown v. Witter, 10 Ohio, 143; Dodsworth v. Iron Works, 13 C. C. A. 552, 557, 66 Fed. 483; Swain v. Seamens, 9 Wall. 254, 272, 19 L. Ed. 554; Beck v. Bridgman, 40 Ark. 382, Nevertheless though part performance which is beneficial to the defendant is obviously entitled to greater weight than part performance which is not, cases may arise where a detriment incurred by the plaintiff in part performance of his contract will influence the conclusion of the court, although there has been no corresponding benefit received by the defendant.55 In a divisible contract if the part performance consists of one or more complete divisions, the part performance will either have been paid for, or a debt for it will have arisen. Under these circumstances the plaintiff's part performance will inflict no hardship upon him even if the contract is discontinued. 56 390; Andrews v. Hensler, 6 Wall. 254, 258, 18 L. Ed. 737; Conner v. Henderson, 15 Mass. 319, 321, 8 Am. Dec. 103; Teter v. Hinders, 19 Ind. 93; Howard v. Hayes, 47 N. Y. Super. Ct. 89, 103; Welsh v. Gossler, Id. 104, 112; Underwood v. Wolf, 131 Ill. 425, 23 N. E. 598, 19 Am. St. Rep. 40; Brown v. Foster, 108 N. Y. 387, 15 N. E. 608; Vanderbilt v. Eagle Iron Works, 25 Wend. 665; Lyon v. Bertram, 20 How. 149, 153-155, 15 L. Ed. 847; Clark v. Steel Works, 3 C. C. A. 600, 53 Fed. 494, 499; Voorhees v. Earl, 2 Hill, 288, 294, 38 Am. Dec. 588; Barnett v. Stanton, 2 Ala. 181; Churchill v. Holton, 38 Minn. 519, 38 N. W. 611; Treadwell v. Reynolds, 39 Conn. 31, 21 Am. & Eng. Enc. Law, 557, note 2. It is only when the parties to the agreement can be placed in statuquo that one may rescind or repudiate the entire contract for the failure of the other to perform it. When one party has received the benefits of substantial performance by the other without paying for them the price agreed on, and he cannot or does not return these benefits, it is manifestly unjust to permit him to retain them without paying or doing as he promised to pay or do on account of his receipt of them. In order to avoid such an injustice, the party who has substantially performed may enforce specific performance of the covenants of the other party, or may recover damages for their breach without plea or proof of complete performance, while the defendant, on the other hand, may recover by counter-claim or by an independent action the damages which he has sustained from the plaintiff's failure to completely fulfil his covenants." 55 Freeman v. Taylor, 8 Bing. 124; Bettini v. Gye, 1 Q. B. Div. 183. In the latter case, Blackburn, J., said: "The plaintiff, therefore, has, in conse quence of this agreement, been deprived of the power of earning anything in London from the first of January to the 30th of March; and though the defendant has, perhaps, not received any benefit from this, so as to preclude him from any longer treating as a condition precedent what had originally been one, we think this at least affords a strong argument for saying that subsequent stipulations are not intended to be conditions precedent, unless the nature of the thing strongly shows they must be so." 56 See infra, § 870. §844. Breach in limine. Where a breach occurs at the very outset (a breach in limine) a stricter rule is applicable. It is sometimes said that any breach in limine will excuse the other party; 57 and at least in the law of sales of personal property this extreme statement is nearly if not quite justified. 58 In equity, however, a rule prevails which differs from this. It is possible for equity to make a decree in favor of a plaintiff who has not fully performed, conditional upon compensation being given by the plaintiff for his partial default. Equity can of course find opportunity for the exercise of this rule only in regard to contracts for breach of which specific performance will lie; that is generally only in regard to contracts for the sale of real estate. In such contracts the principle has been applied in favor of a vendor who is able to give a good title to nearly, but not quite all of the property which he contracted to sell, and who has not been guilty of bad faith,59 or who has been unable to remove some small incumbrance on the property,60 or who offers the property in a condition inferior to that which the buyer is entitled to require.61 If, "Langdell, Summ. Cont., §§ 158160. See also Petersburg Fire Brick & Tile Co. v. American Clay M. Co., 89 Ohio, 365, 106 N. E. 33, 36, L. R. A. 1915 B. 536. 5 See infra, § 1009. "Poole v. Shergold, 1 Cox Eq. Cas. 273, 2 Bro. C. C. 118, s. c.; Calcraft v. Roebuck, 1 Ves. Jr. 221; McQueen v. Farquhar, 11 Ves. 467; King v. Wilson, 6 Beav. 124; Keepers v. Yocum, 84 Kan. 554, 559, 114 Pac. 1063; Hammer v. Westphal, 120 Md. 15, 87 Atl. 488; Van Blarcom v. Hopkins, 63 N. J. Eq. 466, 52 Atl. 147; Mundy v. Irwin, 20 N. Mex. 43, 145 Pac. 1080; Leigh v. Crump, 1 Ired. Eq. 299; Courcier v. Graham, 2 Oh. 341; McCourt v. Johns, 33 Or. 561, 53 Pac. 601; Stoddart v. Smith, 5 Binn. 355; Charles B. James &c. Co. v. Vernon, 129 Tenn. 637, 168 S. W. 156, 52 L. R. A. (N. S.) 959; Nagle v. Newton, 22 Gratt. 814; Farris v. Hughes, 89 Va. 930, 17 S. E. 518; Creigh's Adm'r v. Boggs, 19 W. Va. 240; Corless v. Sparling, Ir. R. 9 Eq. 595. 60 Howland v. Norris, 1 Cox Eq. Cas. 59; Drewe v. Hanson, 6 Ves. 675; Halsey v. Grant, 13 Ves. 73; Horniblow v. Shirley, 13 Ves. 81; Fildes v. Hooker, 3 Madd. 193, 195; Keepers v. Yocum, 84 Kan. 554, 114 Pac. 1063; Capstick v. Crane, 66 N. J. Eq. 341, 57 Atl. 1045; Winne v. Reynolds, 6 Paige, 407; Guynet v. Mantel, 4 Duer, 86; Thompson v. Carpenter, 4 Pa. State, 132, 45 Am. Dec. 681. 61 Grant v. Munt, Cooper Ch. t. Eldon, 173; Dyer v. Hargrave, 10 Ves. 505; Scott v. Hanson, 1 Russ. & M. 128; Powell v. Elliot, 10 Ch. 424; Towner v. Tickner, 112 Ill. 217; King v. Bardeau, 6 Johns. Ch. 38; Smyth v. Sturges, 108 N. Y. 495; Stewart v. Conyngham, 1 Ir. Ch. R. 534. |