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performance of contracts generally. First, an action for damages generally.
only must appear an inadequate remedy (e). Secondly, there must be mutuality of remedy (s), e.g. an infant cannot obtain a decree (g). Thirdly, the contract must be certain in its terms (k). Fourthly, the contract must not be in its nature revocable, as the interference of the court might after decree be rendered useless, e.g. in the case of an agreement to enter into a partnership, the duration of which is not specified, and which would consequently be a partnership at will merely (i). Fifthly, there must be a consideration for the contract (k). Contracts relating to personal property will, in general, be enforced when the subject matter is very rare, or of unusual beauty or character (1). Specific performance under some or other of the above conditions will consequently be decreed of agreements relating to inventions and
letters patent (mn). Specific per:
An agreement for the sale of a patent may, at the instance of contracts for either the vendor or purchaser, be decreed to be specifically persale of
formed. This is the case even if the patent was not, at the date patents.
of the contract, actually taken out by the vendor, provided, at least, he was then entitled to make an application for the same (n). And even before the patent was granted, it was held that the court would enforce specific performance to the extent of decreeing
(e) Harnett v. Yeilding, 2 Sch. & Lef. 553; Fry, 22.
(f) Story, 723; Adderley v. Dixon, 1 Sim. & Stu. 607; Fry, 201; Williams v. Williams, L. R. 2 Ch. 294, 304,
(9) Flight v. Bolland, 4 Russ. 301. For cases on other points, see Wright V. Bell, 5 Price, 325; Kenney v. Texham, 6 Madd. 355; Cogent v. Gibson, 33 Beav. 557 (infra).
(h) Moseley v. Virgin, 3 Ves. 184; Story, 728; Fry, 37.
(k) Jefferys V. Jefferys, Cr. & Ph. 141, which was the case of a father, by voluntary settlement, covenanting to surrender copyholds to trustees for his daughters. See also Hervey v. Audland, 14 Sim. 531; and Fry, 42.
(1) E.g., railway shares of a limited number, Duncuft v. Albrecht, 12 Sim. 199; timber, by reason of its vicinity, of peculiar convenience to the plaintiff, a ship carpenter, Adderley v. Dixon, supra; Buxton y. Lester, 3 Atk. 385; pictures, Dowling v. Betjemann, 2 John. & Hem. 544; and heirlooms, &c., Somerset v. Cookson, 1 Wh. & Tu. L. Cas.; Pusey V. Pusey, 1 Vern. 273. As to inventions and patents, see the text above in continuation.
(m) See Snell on Equity, and Fry on Specific Performance, generally.
(n) Cogent v. Gibson, supra. In that case the agreement was to sell a British patent, which the vendor, the owner of a French patent for the same invention, had thereby agreed to take out at the expense of the purchaser. The patent was taken out, and the vendor was decreed specific performance.
that the vendor, the defendant, should sign and seal a complete specification, tendered him by the purchasers, and, according to the agreement, completed by them at their own expense (0). An agreement by a vendor to assign all future patents obtained by him for improvements on the patented invention thereby agreed to be sold, will, apparently, be decreed to be specifically performed, and such an agreement is not against public policy (P). An agreement to lend money to enable an inventor to take out Specific per
formance of a patent cannot be specifically enforced. In Rogers v. Challis (1) agreements the court refused specific performance of a written agreement to and borror
for lending borrow, which definitely fixed the terms of the loan, and the ing money. security to be given, but had remained unperformed by the intended lender, the plaintiff. Again, on the principle (in particular) that there was no mutuality of remedy, the court refused specific performance of a written agreement to lend money for a defined period at interest (»). The court, however, will decree specific performance of an agreement to execute a mortgage in consideration of money actually due or advanced (s). Where some money has already been advanced, or other part performance occurred in an agreement to lend money to an inventor to enable him to take out the patent, which money is to be secured on the patent itself, together with interest dependent to some extent on the net profits, specific performance of the agreement to borrow or lend might, it is submitted, be decreed. The mortgage for the money advanced would, as above stated, be decreed to be executed. The borrower has, moreover, as to the payment of interest out of or by reference
(0) Lewin v. Brown (1866), 14 W. R. 640.
(p) Printing and Numerical Registering Company v. Sampson, L. R. 19 Eq. 462; Leather Cloth Company v. Lorsont, L. R. 9 Eq. 343.
(1) 29 L. J. Ch. 240. Lord Romilly there said that the Statute of Frauds did not apply to an agreement to borrow, and, therefore, if specific performance could be decreed in the case of a written agreement, it would be decreed in the case of a mere conversation, and, in the latter case, the task of the court would be too difficult and dangerous.
(r) Sichel v. Mosenthal, 31 L. J. Ch. 386. The agreement was one for entering into a partnership with an existing firm at a future fixed date, or, in default of the defendant so doing, for him to make the loan to the firm for two years at interest. The agreement had remained unperformed by the intended borrowers, the firm, who were plaintiffs. See also Brough v. Oddy, 1 Russ. & Myl. 55; Flight v. Bolland, 4 Russ. 298; Bas8 v. Clively, 1 Tamlyn, 80; Crampton v. The Varna Railway Co., L. R. 7 Ch. 562..
(8) Ashton v. Corrigan, L. R. 13 Eq. 76; Hermann v. Hodges, L. R. 16 Eq. 18; cf. Taylor y. Eckersley, L. R. 2 Ch. D. 302 (all cited in Fry, 17).
Rescission of contracts.
to the net profits contracted to sell (so to speak) a kind of derivative interest under the patent. The borrower also may almost be considered as being unable to obtain moneys elsewhere on the strength of the invention and prospective patent rights, on account of their highly speculative and uncertain character. There seems, however, to be no direct authority on the point (t).
In general, a contract cannot be rescinded unless by consent of both parties (u). Exceptions occur in the cases of fraud, duress, or mistake (x), or where there has been a total failure of the consideration (y), or where a condition precedent has not been (s) or cannot be performed (a). Where there is a contract for the supply of goods of a certain total quantity by periodical instalments, the failure to supply any instalment will not preclude the defaulting party from requiring the completion of the contract (6), unless time is of the
(t) As to the cases of Rogers v. Challis, and Sichel v. Mosenthal, Fry, L.J., in his work on Specific Performance, p. 17, notices that the agreement remained unperformed in the former case by the intended lender, and in the latter case, by the intended borrower, and states the decisions with these qualifications accordingly, but expresses no opinion as to what decree in each case would have been made if some money had already been paid, or other part performance occurred.
(u) Chitty, 675; Addison, 1218.
(y) E.g., where the thing bargained for is completely different in substance from that delivered (Kennedy v. Panama, &c. Mail. Co., L. R. 2 Q. B. 580); or cannot come into existence (Knowles v. Bovill, 22 L. T. N. S. 70). In the latter case, there was an agreement in consideration of an immediate monetary payment for a patentee to apply for prolongation of an existing patent, and also for a patent for a new invention, and also for him to grant licences of both patents to the other party. The patentee's death totally prevented the applications, and it was held that the money must be returned, on the ground of total failure of the consideration. See, also, Chanter v. Leese (+ Mees. & Wels. 295; affirmed 5 ibid. 698) as to total failure (constructively under the circumstances) of the consideration for a licence not under seal, namely, the exclusive use of six patents, one of which was found void. If the licence had been under seal, in which it was recited that the patent was valid, there would have been an estoppel (see ante), and the plea would have been void (Bowman v. Taylor, 2 Adolph. & Ell. 295). As to estoppel of a licensee by mere relationship, and failure of consideration moving from the licensor, see Chapter on Licences,” post, pp. 187–191.
(2) Fitt v. Cassanett, 4 Mac. & G. 898; Chitty, 676. The defendant had made no default, and was held entitled to rescind.
(a) Chanter v. Leese, supra, and p. 46, post.
(6) Pordage v. Cole, 1 Wm. Saund. 3191; Simpson v. Crippin, L. R. 8 Q. B. 14; Jonassohn y. Young, 32 L. J. Q. B. 385.
essence (c). Where, in the latter case, each instalment is to be paid for on delivery, the failure to pay for any instalment will enable the vendor to cease supplying further goods (d). If part of a contract is performed, so that only partial failure occurs, no moneys paid can be recovered (e), unless the consideration is clearly severable ($). If a partial failure of performance can be compensated for in damages the contract is not put an end to (9) ; nor can a contract in general be rescinded in toto by one party where both cannot be placed in the identical situation which they occupied when the contract was made (1), and accordingly, where one party has derived some advantage from the other party having to some extent performed the contract, the general rule is that the agreement shall stand, and that the defendant must perform his part thereof, and seek compensation in damages for the plaintiff's default (i). Where the consideration has been executed, or, in other words, one party has entirely performed his part of the contract, the other party cannot by denying the title of the plaintiff to the subject-matter of the contract be allowed to be discharged therefrom. This is illustrated by the case of an agreement not under seal, whereby the defendant was licensed by the plaintiff to manufacture manure according to the plaintiff's patent, and sell the same. The prescribed quantity of manure was manufactured and sold by the defendant, who then refused to pay moneys under
(c) See Hoare v. Rennie, 5 Hurl. & Norm. 19, where the first supply was exceedingly deficient in quantity, and the purchaser was held entitled to rescind. The decision is disapproved of in Simpson v. Crippin, and Jonassohn v. Young, supra; but semble, may be upheld on the ground of time being of the essence of the contract. See Bradford y. Williams, L. R. 7 Ex. 259, where the decision is cited with approval, but apparently on the ground of the failure going to the root of the contract. See also 2 Sm. L. Cas. 39 (7th ed.), notes to Cutter v. Powell, where the decision in Simpson v. Crippin is approved of, and the rule laid down that in order to the rescission of a contract, the breach must have been as to something essential.
(d) Withers v. Reynolds, 2 B. & Ad. 882.
(e) Addison, 1181, citing Hunt v. Silk, 5 East, 449; Blackburn v. Smith, 2 Exch. 783; Nicholson v. Ricketts, 29 L. J. Q. B. 55.
(f) Addison, 1181; Astle v. Iright, 25 L. J. Ch. 864.
(9) Per Littledale, J., in Franklin v. Miller, 4 Adolp. & El. 599, 605; Chitty, 677. See also Jonassohn v. Young, supra, and Weaver v. Sessions, 6 Taunt. 155.
(h) Chitty, 677, citing Blackburn v. Smith, supra; Fitt v. Cassanet, supra (per Tindal, C.J.); Hunt v. Silk, supra; and Beed v. Bland ford, 2 Younge & Jery. 278.
(i) Chitty, 677.
No apportionment of entire contract.
the agreement, and pleaded the invalidity of the patent. It was held that the plea was no defence (k).
An entire contract cannot be apportioned (1). So that if a party undertake to complete a certain act which is entire or indivisible, before his claim to remuneration is to accrue, he cannot recover for a partial performance, although the completion of the act was prevented by an inevitable accident (m). The rule, however, is subject to the question of claim upon a quantum meruit against any party to the contract who accepts and retains the benefit of the partial performance after the time for completing the contract has elapsed (n). Such acceptance and retaining affords evidence of a new contract on a quantum valebant (o).
(k) Lawes v. Purser (1856), 6 Ell. & Black. 930. See further cases on the point in the Chapter on Licences,” post, pp. 189—191.
(1) Chitty, 670, citing Chanter v. Leese, 4 Mees. & Wels. 295; affirmed 5 ibid. 698; and, in general, 3 Vin. Abr. tit." Apportionment”; 2 Pothier, by Evans, 44. In Chanter v. Leese, the enjoyment of the six patents under which the exclusive licence was granted, was held to be the consideration for every part of the licensee's promise to pay an annuity. See this case as referred to in note (y), at p. 44, ante.
(m) Chitty, 670 et seq., in which the rule of non-apportionment is illustrated by decided cases- -(1) as to remuneration of a sailor at a fixed sum who dies on the voyage; (2) as to a covenant in a charter-party to pay freight on goods being delivered at B., but which, however, were carried to A., where the ship was wrecked, and were accepted by the defendant there; (3) as to acceptance of the surrender of a tenancy in the middle of a quarter without any agreement for apportionment of rent; and (4) as to the eviction by landlord of his tenant from part of premises let at an entire rent, which eviction afforded a complete defence to an action for the use and occupation of the whole of the premises.
(n) Chitty, 523, 678; and Chanter v. Leese, ubi supra.
(o) Chitty, 678, citing Mondell v. Steel, 8 Mees. & Wels. 858, 871. See also 2 Smith, L. Cas. 28, 29 (7th edit.), notes to Cutter v. Powell.