founded on good consideration, where the deed expresses a nominal consideration (a) or no consideration at all (b), though (save in a case of fraud or illegality) a consideration actually inconsistent with that expressed in the deed could probably not be shown (a). effect to Closely connected with this in principle is the rule of equity Equity won't give that although no consideration is required for the validity of a complete declaration of trust, or a complete transfer of any legal imperfect gifts. or equitable interest in property, yet an incomplete voluntary gift creates no right which can be enforced. Certain recent decisions have indeed shown a tendency to infringe on this rule by construing the circumstances of an incomplete act of bounty into a declaration of trust, notwithstanding that the real intention of the donor was evidently not to make himself a trustee, but to divest himself of all his interest (c). But these have been disapproved in still later judgments which seem entitled to more weight (d). (a) Leifchild's ca. 1 Eq. 231. (b) Llanelly Ry. & Dock Co. v. L. & N. W. Ry. Co. 8 Ch. 942. (c) Richardson v. Richardson, 3 Eq. 686, Morgan v. Malleson, 10 Eq. 475. (d) Warriner v. Rogers, 16 Eq. 340, Richards v. Delbridge, 18 Eq. 11, Heartley v. Nicholson, 19 Eq. 233. 166 Original type of contract. CHAPTER V. EFFECTS AND INCIDENTS OF CONTRACT. (Rules as to parties: Contracts with uncertain persons: Effects on third persons: Transfer of Contracts). The original and simplest type of contract is an agreement creating an obligation between certain persons. The persons are ascertained by their description as individuals, and not by their satisfying any general class-description: or, more shortly, they are denoted by proper names and not by class-names (a). And the persons who become parties in the obligation created by the agreement are the persons who actually conclude the agreement in the first instance, and those only. The object of this chapter will be to point out the extent to which modern developments of the law of contract have altered this primary type either by modifications co-extensive with the whole range of contract or by special classes of exceptions. The fundamental notion from which we must take our departure is one that our own system of law has in common with the Roman system and the modern law of other civilized countries derived therefrom. There is some evidence that we ourselves got this (together with other principles of the law of contract) from Roman sources. However that may be, we find it as firmly established in our own system as in the Roman from a very carly date, though it happens not to be definitely expressed in a general form in any of our authorities. A wide statement of the principle may be given in the shape of a maxim thus: (a) Savigny, Obl. § 53 (2. 16), cp. rally, ib. §§ 53-70, pp. 17-186. on the subject of this chapter gene The legal effects of a contract are confined to the contracting Legal efparties. fects confined to This This, like most if not all legal maxims, is a generalization contracting parties. which can be useful only as a compendious symbol of the particulars from which it is generalized, and cannot be understood maxim to except by reference to those particulars. The first step towards be devethe necessary development may be given in a series of more loped. definite but still very general rules, which we shall now endeavour to state, embodying at the same time those qualifications, whether of recent introduction or not, which admit of being stated in an equally general form. tions. We give some preliminary definition of terms which it will be Definiconvenient to use in extended or special senses. A contract creates an obligation between the contracting parties, consisting of duties on the one part and the right to demand the performance of them on the other. "debtor." Any party to a contract, so far as he becomes entitled to have "Creditor" anything performed under the contract, is called the creditor, and So far as he becomes bound to perform anything under the contract he is called the debtor. sentation." Representation, representatives, mean respectively succession "Repreand the person or persons succeeding to the general rights and liabilities of any person in respect of contracts whether by reason of the death of such person or otherwise. A third person means any person other than one of the parties to the contract or his representatives (a). "Third person." Rules. 1. The original parties to a contract must be persons Rules. ascertained at the time when the contract is made. Parties. 2. The creditor can demand performance from the debtor Third peror his representatives. He cannot demand nor can the debtor sons not require him to accept performance from any third person. Explanation. The debtor or his representatives may perform. the duty by an agent. bound. 3. No third person can become entitled by the contract itself Third perto demand the performance of any duty under the contract. (a) Contracts for the sale of land are enforceable in equity by and against the heirs or devisees of the parties. But here the obligation is son not entitled. Assign ment. Notice to debtor. Equities. Ехсерtions: Strictly personal duties. Strictly rights. 4. Persons other than the creditor may become entitled by representation or assignment to stand in the creditor's place and to exercise his rights under the contract. Explanation 1. Title by assignment is not complete as against the debtor without notice to the debtor, and a debtor who performs his contract to the original creditor without notice of any assignment by the creditor is thereby discharged. Explanation 2. The debtor is entitled as against the representatives and, unless a contrary intention appears by the original contract, as against the assignees of the creditor, to the benefit of any defence which he might have had against the creditor himself. (The following exceptions are given in order to complete the general statement. The further discussion of them however would not be relevant to the subject of this chapter. They are connected in principle with the cases of a contract for personal services or the exercise of personal skill becoming impossible of performance by inevitable accident, of which we speak in Ch. VII. below). Exception 1. If it appears to have been the intention of the parties that the debtor should perform any duty in person, he cannot perform it by an agent nor can performance of it be required from his representatives. Such an intention is presumed in the case of any duty which involves the exercise of the debtor's personal skill. Exception 2. If it appears to have been the intention of the personal parties that only the creditor in person should be entitled to have any duty performed, no one can become entitled by representation or assignment to demand the performance of it, nor can such performance be required from the debtor's representatives. Such an intention is presumed if the nature of the transaction involves personal confidence between the parties, or is otherwise such that "personal considerations" are of the foundation of the contract (a). (Cp. Indian Contract Act 1872, ss. 37, 40). (a) See Stevens v. Benning, 1 K. & J. 168, Farrow v. Wilson, L. R. 4 C. P. 744, 746; Robinson v. Davison L. R. 6 Ex. 269; 2 Sm. L. C. 36. If in any of these cases the transaction is continued by mutual consent, it is a new contract: e.g. if a servant continues his service with a deceased master's family, or if a painter's executor, being also a painter, were to complete an unfinished portrait on the original terms at the sitter's request. Exception 3. The representatives of a deceased person cannot sue for a breach of contract in a case where the breach of contract was in itself a merely personal injury, unless special damage to the estate which they represent has resulted from such breach of contract. But where such damage has resulted the representatives may recover compensation for it, notwithstanding that the person whose estate they represent might in his lifetime have brought an action of tort for the personal injury resulting from the same act (a). It will be observed that these propositions are intended to express the general effect of contracts in creating rights and liabilities whether equitable or legal. The distinctions between law and equity will be noticed in the course of the more detailed consideration on which we now have to enter. Apart from any such distinctions, the propositions are subject to several special qualifications and exceptions. Most of the exceptions are of modern origin, and we shall see that since their establishment many attempts have been made to extend them. These attempts have in some departments been successful, while in others exceptions which for some time were admitted have been more recently disallowed. We shall now go through the rules thus stated in order, pointing out under each the limits within which exceptions are admitted in the present state of the law. The decisions which limit the exceptions are for the most part the chief authorities to show the existence of the rules, which are of so general a kind as to be rather assumed as the groundwork of decisions than expressly affirmed. tract with Our first rule is that the original parties to a contract must be Rule 1. persons ascertained at the time when the contract is made. It No conmay also be expressed shortly but less accurately thus: a contract uncertain cannot be made with an uncertain person. We need not stop to person. produce authorities for the general proposition, which will be sufficiently illustrated as we go on. Nor do we consider here the cases in which the parties to a contract are originally certain persons, but are liable to be changed on one or both sides in (a) See 1 Wms. Exors. 752-3, 6th ed., 798, 7th ed. and the late interesting case of Bradshaw v. Lan cashire & Yorkshire Ry. Co. L. R. |