CHAPTER VI.

OF CONTRACTS GENERALLY.

§ CONTRACTS MAY BE—

1. Executory. That is, where there is a promise to do, or not to do, something in the future.

2. Executed. Where one, or both, of the contracting parties has carried out what he agreed to do.

For example, where Jones promises to pay Smith £6 a load for six loads of hay, which Smith is to deliver to him; when Smith has delivered the hay, the contract is executed, as far as he is concerned; but still executory on Jones' part, until Jones has made payment.

§ CONTRACTS MAY ALSO BE—

1. Express. Where the terms of the contract are clearly defined by both parties.

2. Implied. Where the law presumes a contract from an existing state of facts.

For instance, if Jones, who is a gardener, works in Smith's

garden for a month at Smith's request, the law presumes a contract on Smith's part to give Jones reasonable wages for his labour.

§ CONTRACTS ARE OF THREE KINDS———

1. Of record.

2. Of specialty.

3. Simple.

CHAPTER VII.

CONTRACTS OF RECORD AND SPECIALTY.

I. CONTRACTS OF RECORD

1. Judgments. A judgment recovered in a court of competent jurisdiction, whether English, foreign (which includes Scotch and Irish judgments), or colonial, constitutes a contract of the highest kind; and an action can be brought thereon.

[But no costs can be recovered in an action on an English judgment without an order from the judge trying the case, as the plaintiff might have realised his judgment by execution (a).]

2. Statutes merchant. Bonds of record acknowledged before the clerk of the statutes merchant, and the Lord Mayor of London, or a mayor of some other city or borough, sealed with the seal of the debtor and of the Sovereign; and conditioned, that if the debtor fails to pay his debt, by a certain day, execution may be awarded against his lands and goods.

3. Statutes staple. Bonds of like nature to the preceding only acknowledged before the mayor and constables of the staple in the chief cities.

[Stapulum, Estape, a market. The merchants of the principal "staples," or marts, originally held courts, and exercised a certain jurisdiction for the regulation of their particular trades in Westminster, York, Lincoln, Canterbury, Norwich, Newcastle, Chichester, Winchester, Bristol, and other cities.]

(a) 43 Geo. 3, c. 46, s. 4.

4. Recognizances. Bonds of record, wherein an existing debt is acknowledged to the Sovereign, sealed with the seal of the "cognisor" (the debtor), the Sovereign, and one of the chief justices; and conditioned like a statute merchant. § PECULIAR ATTRIBUTES OF A CONTRACT OF RECORD

1. It works a merger." That is to say, it absorbs, and is substituted for, or "merges," a contract of a less high kind, of which the substance is the same, on the principle that the greater contains the less.

For instance, if Jones is bound to Smith in a bond, or specialty (see post, p. 20), and Smith sues and recovers judgment on the bond, Smith's right of action on the bond is gone, the specialty contract being swallowed up in the contract of record; and Smith, in future, if he wants to sue at all, must sue on the judgment.

[But this is not the case with foreign and colonial judgments.]

2. It acts as an estoppel. That is, it concludes all parties to it, and those claiming through them, from setting up anything in contradiction of its terms, so long as it remains unreversed.

Illustration. One Huffer owed Allen £28. Allen brought

an action for the money. Huffer entered no appearance, but paid Allen £10 on account. Allen then wrongfully signed judgment for the whole debt, and issued execution for £32, debt and costs, and arrested Huffer. Huffer, without getting this judgment set aside, brought an action against him for maliciously signing judgment and issuing execution. The court held that, whilst the judgment stood for the full amount, the plaintiff was estopped from denying the correctness of the judgment and execution, and that, Huffer therefore, was unable to recover. (b)

3. It requires no consideration to support it. (See post, p. 22.) (b) Huffer v. Allen, L. R. 2 Ex. 15.

II. CONTRACTS BY SPECIALTY, that is—

1. Contracts under seal, which may be by

(i) Deed poll (unilateral).

(ii) Indenture (inter partes).

2. Contracts created by virtue of Acts of Parliament. [As an obligation to pay "calls" on shares. (a)]

§ PECULIAR ATTRIBUTES OF A CONTRACT BY SPECIALTY. 1. "It works a merger." That is, it absorbs, and is substituted for, a simple contract debt, like a contract of record. For instance, Jones' bond (see ante, p. 19, Illustration) may have been given to Smith, to secure a debt owing by Jones to Smith for goods supplied; in which case the simple debt would be "merged" in the higher contract, the bond; and Smith could not sue for the simple debt, but would have to take his remedy on the bond, if its terms were not complied with.

2. It acts as an estoppel; for where a man has entered into

a solemn engagement, by deed under his hand and seal, as to certain facts, he is not, in the absence of fraud, permitted to deny any matter to which he has so assented. 3. It requires no consideration to support it, because consideration is presumed from the deliberation of the act. 4. It binds the heir and devisee. That is to say, where a man in a bond expressly binds himself and his heirs, the heir, or devisee of his lands, is bound to discharge the specialty debt, to the extent of the assets of which he becomes possessed.

(a) Cork and Bandon Ry. Co. v. Goode, 13 C. B. 826.

CHAPTER VIII.

SIMPLE CONTRACTS.

§ SIMPLE CONTRACTS are those neither of record, nor under seal. They may either be in writing or by word of mouth.

§ REQUISITES

1. A simple contract must be certain. That is to say, its terms must have been definitely settled.

2. There must be an assent of both parties.

3. Privity must exist between the contracting parties. That is, the relation of contractor and contractee must be directly recognised by both of them.

For example. There is privity of contract between a lessor and a lessee; but, if the lessee sub-lets, there is no privity of contract between the original lessor and the under-lessee.

[NOTE. It has been said that "mutuality" is also

essential to a simple contract. If the meaning of this word is that one party to a contract must be bound, if the other is bound; it may be observed that there are many contracts of an unilateral character, which can be enforced by one party only; as a contract between an infant and an adult, which is void as regards the one, but binding on the other. There are, however, numerous contracts, where "mutuality" is essential; of which a contract of purchase and sale is an instance; for it is mutually

binding on both sides, and the promise of the one party is the consideration for the promise of the other.] § A SIMPLE CONTRACT HAS THREE PARTS, in the absence of any one of which it is incomplete.