CH. I. s. 3. Contracts under Seal.

Immoral consideration.

Ayerst v. Jenkins.

Illegal consideration.

upon the whole transaction, it be clear that such delivery was not intended to be a delivery, at that time, to such grantee, or covenantee (q).

(b) Consideration for Contracts under Seal.

Generally speaking, as we shall see in detail presently, the law leans against mere gifts, and requires reciprocity in contracts. But in the case of a contract under seal, no such reciprocity is ordinarily required, the rule being that a contract under seal is good even against a party deriving no advantage from it (r). It has been doubted, however, whether the total failure of a consideration obviously intended to exist, and upon which a contract under seal is meant to be founded, will not afford a defence to an action upon the contract (s); and it has been laid down that in general specific performance will not be decreed of a contract under seal which is entirely without consideration (t). But an imperfect conveyance, if voluntary, is not binding, and equity will not execute it in favour of volunteers, if anything remains to be done (u).

And if the consideration be immoral or illegal, the contract, though under seal, will be void. As to immoral consideration, the rules are very fully laid down in Ayerst v. Jenkins (x), as follows:

1. "Bonds or covenants founded on past cohabitation, whether adulterous, incestuous, or simply immoral, are valid in law, and not liable (unless there be other elements in the case) to be set aside in equity. 2. Such bonds or covenants, if given in consideration of future cohabitation, are void in law, and therefore of course also void in equity. 3. Relief cannot be given against any such bonds or covenants in equity if the illegal consideration appears on the face of the instrument;" it being added that if an illegal consideration does not appear on the face of the instrument, relief may be given in some circumstances to a particeps criminis in equity.

The rules respecting illegal considerations, which will be fully stated hereafter (post, Ch. XXI.), are generally similar to those respecting immoral considerations.

(q) Per Hall, V.-C., Watkins v. Nash (1875), L. R., 20 Eq. 262.

(r) See Plowd. 308; Pratt v. Barker (1828), 1 Sim. 1, 4 Russ. 507; Morley v. Boothby (1825), 3 Bing. 107.

(8) Bunn v. Guy (1803), 4 East, 190; 7 R. R. 560; Rose v. Poulton (1831), 2 B. & Ad. 822; 36 R. R. 761.

(t) Wycherley v. Wycherley (1763),

2 Eden. 177; Groves v. Groves (1829), 3 Y. & J. 163.

(u) Snell's Principles of Equity, 8th ed., p. 64; Lewin on Trusts, 8th ed., pp. 79 et seq.

(x) Ayerst v. Jenkins (1873), L. R., 16 Eq. 275, at p. 282, per Lord Selborne, L.C.

A contract in restraint of trade, though under seal, requires a valuable consideration to support it (y).

CH. 1. s. 3.

Contracts under Seal.

Restraint of

Further, a contract under seal, if made without consideration, may be impeached by third parties, on similar grounds to those on trade. which voluntary settlements can be impeached as being fraudulent Impeachas against creditors (2).

(c) Other Attributes of Contracts under Seal.

ment by third parties.

As between the parties to the instrument, and in an action Estoppel. upon it—or where an action is brought to enforce rights arising out of the deed, and not collateral to it (a)—a deed operates as a conclusive bar, and prevents all inquiry into the truth (b); except, indeed, in cases of duress or fraud, or where there existed some incompetency in the contracting parties, or illegality in the consideration or object upon or for which the deed was made. In these cases the facts may be pleaded in order to defeat the deed, even although they may contradict statements made on the face of the deed (c). And so, although a party to a deed may be estopped from denying facts which are stated in it, he is not estopped from saying that, on the facts so stated, the deed is void in law (d).

recital.

The general rules as to estoppel by recitals in a contract under Estoppel by seal appear to be that a statement intended to be the statement of one party binds that party only (e), and that an averment in a recital does not operate as an estoppel unless it be clear and precise (ƒ).

And as a deed is a security of a higher nature, so it operates as Merger. a merger or extinguishment of any simple contract in respect whereof it was entered into (g); upon the same principle that a judgment upon a specialty merges it (h).

It is, at common law, an attribute of a contract under seal that it can be varied or discharged by another contract under seal only, and not by a contract under hand or by word of mouth (i);

(y) Homer v. Ashford (1825), 3 Bing. 322, and Ch. XXI., sect. 2, post.

(z) See 13 Eliz. c. 5; 27 Eliz. c. 4; Rosher v. Williams (1875), L. R., 20 Eq. 210.

(a) Wiles v. Woodward (1850), 5 Ex. 557, 563.

(b) Carpenter v. Buller (1841), 8 M. & W. 209. The same rule prevails in equity; Carter v. Carter (1857), 27 L. J., Ch. 74.

(c) See Collins v. Blantern (1767), 2 Wils. 341; Hill v. Manchester and Salford Waterworks Company (1831), 2 B. & Ad. 544.

(d) Doe d. Preece v. Howells (1831), 2

B. & Ad. 744.

(e) Stronghill v. Buck (1850), 14 Q. B. 781.

(f) See Heath v. Crealock (1874), L. R., 10 Ch. 22; General Finance, &c., Co. v. Liberator Society (1879), 10 Ch. D. 15.

(g) Bac. Abr. Debt (G.); per Lord Ellenborough, C.J.; Drake v. Mitchell (1803), 3 East, 251; 7 R. R. 449.

(h) See id. ; 3 Chit. Com. L. 11.

(i) Kaye v. Waghorn (1809), 1 Taunt. 428; Broom's Legal Maxims, 7th ed., at p. 665, and see the rule recognised but broken in upon in Nash v. Armstrong, 10 C. B., N. S. 259.

Mode of discharge.

Steeds v.

Steeds.

CH. I. s. 3. Contracts under Seal.

Period of limitation for remedy.

but the rule is otherwise in equity (k), so that by the operation of the Judicature Act, 1873, s. 25, sub-s. 11, the rule of equity prevails (1).

The period during which a remedy may be had in damages for a breach of contract is twenty years, if the contract be under seal, whereas it is only six years, if the contract be not under seal (m).

Simple contracts.

Consideration.

Doctrine of Estoppel does not apply.

SECT. 4.-Simple Contracts.

Simple contracts are made either (1) by word of mouth, when they are termed oral, or (2) by writing without seal; and by a strange misuse of language both kinds of simple contract are frequently spoken of in English law as parol contracts, notwithstanding that the term "parol" both etymologically and in general parlance means "by word of mouth."

By the Statute of Frauds, as will be seen presently (n), certain agreements must be reduced into writing, and signed by the party to be charged thereon; and other more recent acts of parliament have rendered writing and signature indispensable to the validity of particular promises (o). But the ceremonies of writing and signature are prescribed in these cases, merely as necessary evidence of the contract or promise to which they refer, and not as essential or constituent parts of the engagement itself (p). The mere fact, therefore, of the contract being reduced into writing and signed, does not alter either its character or its effect; it is still merely a simple contract, and in order to give it efficacy it must possess all the usual requisites of a simple contract. Thus, a consideration is absolutely necessary to the validity of such a contract, whether it be merely oral, or be in writing and signed; whereas a writing sealed and delivered is supposed, by law, to express fully the intention of the party by whom it is executed; and he is, in general, bound by its execution, even in a Court of Equity, whether he received a consideration for the engagement which it comprises or not (q).

Again: the doctrine of estoppel, whereby "a man is concluded by his own act or acceptance, to say the truth," applies, in general,

(k) Webb v. Hewitt (1857), 3 Kay & J. 438.

(1) See Steeds v. Steeds (1889), 22 Q. B. D. 537, per Huddleston, B., and Wills, J., describing the common law rule as "purely the result of a technicality absolutely devoid of any particle of law merits or justice."

(m) See post, Ch. XXIII., sect. 8, tit. "Statutes of Limitation."

(n) 29 Car. 2, c. 3, Ch. IV., post. (0) See Ch. IV. sect. 1.

(p) See Laythoarp v. Bryant (1836), 3 Scott, 238, 250.

(a) See p. 4, ante.

CH. I. s. 4.
Simple
Contracts.

Admission.
Pickard v.

to deeds and records only (r); not to simple contracts (s); though
a statement or admission contained in a simple contract is strong
presumptive evidence against the party, although it be not con-
clusive. He is still at liberty to prove that such admission was
mistaken or untrue; and he is not estopped or concluded by it, Sears.
unless another person has been induced thereby to alter his
condition; but if this be the case, then he is estopped with
respect to that person and those claiming under him, and that
transaction (t).

(2) Co. Litt. 352 a; Com. Dig. Estoppel (A); and p. 5, ante.

(s) E.g., a bill of lading is not conclusive evidence of the shipment, as between shipper and ship-owner. See Cox v. Bruce (1886), 18 Q. B. D. 147, C. A., following Grant v. Norway; unless where the bill of lading is signed by the ship-owner under the Bills of

Lading Act, 1855, 18 & 19 Vict. c. 111,

s. 2.

(t) Per Bayley, J., Heane v. Rogers (1829), 9 B. & C. 577; and see Pickard v. Sears (1837), 6 A. & E. 469; Cornish v. Abington (1859), 4 H. & N. 549; Webb v. Herne Bay Commissioners (1870), L. R., 5 Q. B. 642; Dashwood v. Jermyn (1879), 12 Ch. D. 776.

Definition and requisites of a simple contract.

LET us now consider, somewhat more at large, what are the requisites of a contract not under seal, or simple contract.

A simple contract may be defined to be-an engagement entered into between two or more persons, whereby, in consideration of something done or to be done by the party or parties on one side, the party or parties on the other promise to do or omit to do some act (a). And from this definition it appears that, to constitute such an agreement, there must be: 1st, the reciprocal or mutual assent of two or more persons ;-2ndly, a good and valid consideration; and, 3rdly, something to be done or omitted, which is the object of the contract: whilst in these requisites there are involved the two following conditions, viz., 1st, that the assenting parties should be competent to contract; and, 2ndly, that the object of the contract should be in itself legal.

Of the assent

SECT. 1.-The Assent of the Parties.

(a) Generally.

In order that a simple contract may be binding, there must of the parties. first, be the mutual assent of two or more persons, so that, if there be an error in the person with whom a man supposes himself to be contracting, and the consideration of the person forms an ingredient

(a) Com. Dig. Agreement, (A. 1); Plowd. C. 17 a; per Lord Ellenborough, C.J., Wain v. Warlters (1804), 5 East, 10, 17; 7 R. R. 645; Bac. Abr. Agreements; Co. Litt. 47 b. "Le contrat est

ou

une convention, par laquelle une plusieurs personnes, S'OBLIGENT envers une ou plusieurs autres, à donner, à faire, ou à ne pas faire, quelque chose." Code Civil, Liv. III., tit. 3, art. 1101.