De Cicco v. Schweizer

New York Court of Appeals · 1917 · Contracts

Contractsconsiderationpre-existing duty rulethird partyCardozoconsiderationpre-existing dutythird-party promise

Facts

Four days before his daughter Blanche's marriage to Count Gulinelli, the defendant, his wife, and the Count executed a written agreement stating that, in consideration of the engagement and contemplated marriage, the defendant would pay Blanche $2,500 annually during his life, with the first payment due on the day of the marriage. The marriage took place on January 20, 1902, and the defendant made the first payment that day and continued paying annually until 1912. The plaintiff sued as assignee of Blanche, joined in by her husband, to recover the 1912 installment. The defendant argued that because the couple was already engaged, the marriage was only the fulfillment of an existing duty and therefore supplied no consideration.

Issue

Whether the defendant's promise to pay an annuity to his daughter, made after she and the Count were already engaged, was supported by consideration. More specifically, the question was whether the marriage could constitute consideration when the promise was made by a third party and was intended to induce both fiances to go forward rather than rescind or delay a marriage they were free by mutual consent to abandon or postpone.

Rule

A promise by one party to induce another not to break a contract with a third person is void for lack of consideration. But where a third party's promise is made, in substance, to both contracting parties to induce them not to rescind or delay a contract they are free by mutual consent to abandon or modify, and the promise is unilateral so that performance is the consideration, their subsequent performance in reliance on the promise supplies consideration. In such circumstances, reliance and detriment may be inferred from the natural tendency of the promise and the fact of performance.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In Portland, Maine, Lena Ortiz and Caleb Rowan signed a contract to sell Lena's vintage sailboat to Caleb, with closing set for June 1. A week later, Harbor Crest Storage, a stranger to the deal, promised Lena alone $8,000 if she would go through with the sale rather than back out, and Caleb knew nothing of the promise. The closing occurred as scheduled.

If Lena sues Harbor Crest Storage for the $8,000, what is the best argument against enforcement?

Explanation. Under the majority rule, a promise by A to B to induce B not to break B's contract with C is void for lack of consideration. The enforceable category is narrower: a promise in substance made to both contracting parties to induce them not to rescind, modify, or delay a contract they are free by mutual consent to alter, with subsequent performance in reliance. Here the promise ran only to Lena and was aimed at preventing her unilateral breach, so the best argument is lack of consideration.