calls for discrimination between unilateral and bilateral contracts. The performance of services or the transfer of a title which would be sufficient as detriment to support a unilateral contract may take place without any consideration, and if such performance or transfer takes place without being in exchange, it will not serve as consideration for a promise. The transfer, unlike the performance of services, instead of being made, might, by a suitable symbolic act, be tendered on condition that the actor receive an obligation in return. This act is no appreciable detriment in itself. The detriment is suffered, if at all, when the act is given effect to transfer the title. This may be at a much later time, and whenever it occurs it is in exchange for the obligation.

The detriment sustained by either party making a bilateral contract, not only may not, but, cannot, be suffered until and unless it be in exchange for the obligation of the other party. The act of each one tenders, so to speak, the detriment, i.e., the obligation, he is willing to suffer. Neither one suffers that detriment until he does so in exchange for his claim against the other. The prevailing opinion, that one who performs services while ignorant of an existing offer to pay for such services has not thus made a contract,34 is clearly right. It does not, however, militate against crossed offers being effective to make a bilateral contract.

"An acceptance is the distinct act of one party to the contract as much as the offer is of the other *** "35 The act of the offeror is more definitive and extensive than that of the offeree. It embraces a description of two possible obligations and proposes their reciprocal formation. The offeror has originated, or at least formulated, the idea. His authorship, however, should have little or no significance. The acts of the offeror and offeree are in their essential qualities alike. Each consents to the imposition of his own burden. A third person might describe the two obligations and propose their reciprocal formation. A contract would no doubt be formed if his suggestions were adopted, although neither party thereto was author of the arrangement.36 It happens in the rare instances of crossed offers that both parties are authors of the same idea. Each party consents to his part of the arrangement proposed. Why should there not be a contract? Is there a requirement of exclusive authorship in one * party?

34Williams v. West Chicago Railway Co., 191 Ill. 610; Broadmax v. Ledbetter. 100 Tex. 375 (1907).

35 Mactier's Adm. v. Frith, 6 Wendell (N.Y.) 103, 121 (1830). 36 The Satanita L. R., (1895) Probate 248.

A rule giving effect to the will of the parties, as signified by cross offers, would likely be more convenient than one denying such effect. "In the case of crossed offers, each party has acted and has expressed consent; but in so doing, neither has knowingly exercised a power conferred by the other, and neither has been induced to believe that he has such a power to exercise. Each has done an act conferring a power upon the other, and either one may now exercise that power by a subsequent act and thus create a contract. There is, however, no inevitable necessity in our adoption of the machinery of offer and acceptance. The rules of contract, like all other rules of law, are based upon mere matters of policy, or belief as to policy. In the process of our evolution we find that some or all of us are following a customary rule. When we become conscious of this fact, we try to express the rule in words and to compel others to obey it by legislative command. We may fail in our attempt, either because the custom supposed is not the custom of the powerful, or because we have failed to express it with accuracy, or because new life conditions re\quire new customs. So, therefore, we may decree that two acts expressing consent, as in the case of crossed offers, shall create contractual relations; or that, where an offer has been published, that act empowers others to create contractual relations by doing the acts requested, even though without knowledge of the request. It seems not improbable to the writer that this latter rule will prevail in the future."37

Some leading authorities have accounted for contract obligations on the ground that they are the enforcement of promisors to fulfill the expectations their promises have aroused.38 This explanation seems

37 Corbin in 26 Yale L. J. 169, 182. See also note 21 Col. L. Rev. 599. 38"When the law enforces contracts, it does so to prevent disappointment of well founded expectations, which, though they usually arise from expressions truly representing intention, yet may occasionally arise otherwise." Holland, Elements of Jurisprudence (1st Am. Ed.), star page 228.

"The law of contract may be described as the endeavour of the State, a more or less imperfect one by the nature of the case, to establish a positive sanction for the expectation of good faith which has grown up in the mutual dealings of men of average rightmindedness. Accordingly, the most popular description of a contract that can be given is also the most exact one, namely, that it is a promise or set of promises which the law will enforce." Pollock, Principles of Contract (2d. Am. Ed.), p. 1.

"The individual claims to have performance of advantageous promises secured to him. He claims the satisfaction of expectations created by promises and agreements. ***Social interest in the security of transactions, as one might call it, requires that we secure the individual interest of the promisee, that is, his claim or demand to be assured in the expectation created, which has become part of his substance." Dean Pound, An Introduction to the Philosophy of Law, p.

to base obligations upon the subjective state of the promisee and is therefore open to the same practical objections that have been urged against basing them upon the subjective state of the promisor. A large per cent of contract obligations, moreover, come to exist at a moment before the obligee can possibly have such expectations. The offeror, when a bilateral contract has been made by mail, is a "promisee", yet the obligation in his favor comes into existence at a time when he does not even know the offeree has acted. An explanation is not adequate which does not account for the obligation resting upon the offeree as well as the one resting upon the offeror. There are cases where obligations arise without even a promise in the usual sense, and thus without any expectation on the part of the obligee. An illustration was used above where X said to Y, "When you want a melon, take one of mine and owe me fifty cents for it." Suppose Y takes the melon when X knows nothing about it. That would no doubt create an obligation,39 although Y's act hardly amounts to a promise, and surely creates no expectations at the time it is done. Promises are made on the Board of Trade every day, to deliver grain, which the promisee does not expect to be performed. It is the obligation he expects and gets. Promises are sometimes made by men of such ill repute that the promise itself would not arouse expectation of fulfilment. The obligee, after contracting with such a man, may expect performance, but he bases his expectation on the obligation rather than on the promise. The obligee in any of these cases may, after contracting, expect performance, but doesn't the obligation beget the expectation rather than the expectation beget the obligation?

It has been emphasized above that contracts are predicated upon acts of the obligor, often without the promisee having relied on those acts and sometimes without his even knowing about them. The offeror-actor may, after mailing an offer, mail a revocation. The significance of the former is cancelled by the significance of the latter. Here is the one situation where reliance by the promisee may become important. When the offeree receives the offer it tells him of the offeror's first act. He knows nothing about the second until the revocation arrives. He is warranted, by the information which the offeror has given him, in the deduction, when he mails his acceptance, that he has acquired a contract right against the offeror and has himself come under a duty to the offeror. This assurance may well be the basis of other action by him; so reason, as well as the decisions,

39 Wheeler v. Klaholt, 178 Mass. 141 (1901); Fogg v. Portsmouth Atheneum, supra, n. 25.

spares him from any effect of the uncommunicated revocation. This indulgence to the acceptor is not granted, it seems, if he acquires notice of the offeror's later act by even a casual communication.40 The large number of cases where the acceptor-promisee is, or would be, protected against the effect of uncommunicated revocation might inlead a casual examiner to deem reliance by the promisee essential in all cases to the creation of contract obligations. There are many stances, however, as indicated above, where the obligation comes to exist without such reliance on the part of the promisee.

The suggestion made herein is that simple contract obligations are imposed upon those who symbolize by appropriate acts their will to assume such obligations, provided consideration and the requisite formality is present. Acts appropriate to induce such changes in legal relations are of the character and belong to the class denominated juristic acts. Such an act may be complete and operative to induce a contract obligation, although notice thereof has not been communicated to the "promisee." Acts of the kind referred to are distinguishable from other acts and may be profitably recognized as a class. They account for many changes other than the creation of contract obligations, such as transfers of title and creations of power. The actor may lay down conditions upon which the transfer or other change is to take place. He invariably indicates or assumes such a condition in cases where his act is done by way of inducing a contract obligation. A principle seems to have asserted and established itself in the cases, without being expressly recognized, to the effect that one who symbolizes his will to assume a given obligation is placed under such obligation at the instant his symbolic act is completed and its conditions met.

40Dickinson v. Dodds, 2 Ch. Div. 463 (1874). See for a scholarly criticism of this doctrine, Prof. Parks in 19 Mich. L. Rev. 152.

Restrictions on the Duration of

Business Trusts

HORACE E. WHITESIDE

Although the use of the trust device as a form of business organization is by no means a new thing in the law, it is only in recent years that it has been extensively resorted to as a substitute for, or supplement to, incorporation and partnership organization. This new adaptation of an old and tried tool in the law has claimed so much attention from legal writers in recent years that it is both possible and desirable to limit the present discussion rather narrowly. It is the intention of the present writer to deal with those problems that arise out of a consideration of the duration of the business trust in respect of the rule against perpetuities and allied rules. It is proposed to deal with these problems as they exist both in the jurisdictions where limitations on the creation, or vesting, or duration of interests in property have developed without interference or guidance on the part of the legislatures, and also in the jurisdictions where these matters have been within the field of legislative activity. New York will be selected as typical of those jurisdictions having a rule or rules against perpetuities resulting from statute, since by far the greater part of the legislation on this subject in other jurisdictions has been derived from or inspired by the New York Revised Statutes.2

I

Throughout the development of the English law of property the

†Assistant Professor in the Cornell University College of Law.

For a consideration of the subject generally, see: Dunn, Business Trusts (1922); Sears, Trust Estates as Business Corporations, 2d. ed., (1920); Wrightington, Unincorporated Associations and Business Trusts, 2d ed. (1923); Guy A. Thompson, Business Trusts as a Substitute for Incorporation (1920); Cook, Corporations (1923) sec. 622 h; Fletcher, Cyclopedia Corporations, 2d ed., (1908 and Supplements), secs., 6780-6812.

See also the following articles: H. L. Wilgus, Corporations and Express Trusts as Business Organizations, 13 Mich. L. Rev. 71, 205; R. J. Powell, The Passing of the Corporation in Business, 2 Minn. L. Rev. 401; James B. Riley, Business Trusts and their Relation to West Virginia Law, 28 W. Va. L. Q., 287; A. D. Chandler, Express Trusts under the Common Law (1912); Report of Massachusetts Tax Commissioner upon Voluntary Associations (1912); R. S. Stevens, Limited Liability in Business Trusts, 7 CORNELL LAW QUARTERLY 116; C. Magruder, The Position of Shareholders in Business Trusts, 23 Col. L. Rev. 423; Ira P. Hildebrand, The Massachusetts Trust, 2 Tex. L. Rev. 139.

20. S. Rundell, The Suspension of the Absolute Power of Alienation, 19 Mich. L. Rev. 235; Bogert on Trusts, Sec. 49, n. 60, p. 172. Thirteen states and the District of Columbia are enumerated as having adopted the rule against undue suspension of the power of alienation. See n. 50, infra.