ENGINEERING CASES: EXCERPTS FROM DECISIONS.

MISREPRESENTATION.

Mere expression of honest opinion will not, as a rule, be regarded as fraud, either as a basis of an action of deceit or as a ground for setting aside a contract, although the opinion may prove to be erroneous. 141 N. Y. 596. This rule applies ordinarily to statements of the value of property to be bought or sold. 90 N. Y. 272.

FRAUD.

An engineer's estimate which made the rock excavation twice the actual amount, and the earth excavation less than one-half the actual amount, was held not an estimate upon which to base a valid contract; that such an estimate taken with a bid specifying cost of earth excavation over five times its actual cost, and rock excavation less than one and one-half per cent of its actual cost, raised an inference of fraud. In re Anderson (N. Y.), 17 N. E. Rep. 209.

Where two persons about to file bids agreed to become partners in carrying out the contract in case either secured it, both to share the profits equally, the agreement was held not to be against public policy and that it did not appear that the tendency of the contract was to stifle competition. Breslin v. Brown, 24 Ohio St. 565.,

DURESS.

A contractor working under a parol contract had commenced grading one mile of roadbed. The laborers becoming dissatisfied, the owner said to them: "I will stand good for no more work you do for contractor." As a result the contractor was obliged to sign a contract for half a mile of roadbed. The contractor was unable to pay. Held that the contract was not signed under duress. McCormick v. Dalton (Kans.), 35 Pac. Rep. 1113.

Where a person has been refused the payment of the balance due after completing his contract, unless he repair, labor free, certain damages done to the work done by a stranger, he cannot recover

the cost of such extra labor, as he was not under duress. 133 N. Y. 372.

Excessive charges paid to railroad companies refusing to carry or deliver goods, unless these payments were made voluntarily, have been recovered on the ground of duress. 27 L. J. Ch. 137; 30 L. J. Exch. 361.

Where the carrier refuses to transport stock until a certain special contract is signed limiting its liability, it does not bind the shipper. 48 Kans. 210.

SECTION VII.

LEGALITY.

The object of the parties in forming an agreement will now be considered. The courts have limited the freedom of contract to the extent that some objects are forbidden while others are discouraged, and even though all other requirements for the formation of a valid contract be present, yet if the parties have these objects in mind at the time of entering into the agreement, the law will not enforce it.

This subject is divided into two parts: the nature of the objects considered illegal, and the effect of the presence of such objects in a contract.

(a) Nature of Illegality.

1. A contract to perform an act forbidden by law1 cannot be enforced. An agreement to commit a crime; or to do a civil wrong would come under this rule.

2. A contract which is against the policy of the law, or public policy, may be set aside. Agreements which come within the scope of this rule are those which tend to increase litigation; con

1 Wheeler v. Russell, 17 Mass. 258, 281; Byrd v. Hughes, 84 Ill. 174.

2 Collins v. Blantem, 2 Wils. 347, 350; Henderson v. Palmer, 71 Ill. 579, 583.

3 Materne v. Horwitz, 101 N. Y. 469; Hatch v. Mann, 15 Wend. (N. Y.) 45, 46; Clay v. Yates, 1 H. & N. 73; Merrill v. Packer, 80 Iowa 542.

4 Bliss v. Lawrence, 58 N. Y. 442; Holcomb v. Weaver, 136 Mass. 265; Rice v. Wood, 113 Mass. 133; Oscanyan v. Arms Co., 103 U. S. 261, 267-8; Cothran v. Ellis, 125 Ill. 496.

5 Fowler v. Callan, 102 N. Y. 395; Phillips v. South Park Comrs., 119 Ill. 626; Norton v. Tutile, 60 Ill. 130, 134; Dayton v. Fargo, 45 Mich. 153.

tracts with alien enemies; those in restraint of trade; those which interfere with the course of public justice; those which tend to the injury of public service; those which are contrary to morality;10 those which affect the freedom of marriage," and those intended to stifle competition at sales by auction.12

3. Gaming contracts are void by the statutes of most states.13

4. Negotiable instruments given in payment of wagers, if not declared void by statute, follow the general rule as to illegal consideration and are valid in the hands of bona fide holders for value.14

(b) Effect of Illegality.

1. If a contract may be divided into several promises based on several considerations, the illegality of one or more of these considerations will not nullify all the promises.15

6 Woods v. Wilder, 43 N. Y. 164; United States v. Grossmayer, 9 Wall (U. S.) 72; Kershaw v. Kelsey, 100 Mass. 561.

7 Diamond Match Co. v. Roeber, 106 N. Y. 473; Arnot v. Coal Co., 68 N. Y. 558, 565; Gamewell Fire Alarm Co. v. Crane, 160 Mass. 50; Bishop v. Palmer, 146 Mass. 469, 474; Morris etc. Co. v. Coal Co., 68 Pa. St. 173, 184.

8 Gorham v. Keyes, 137 Mass. 583; Partridge v. Hood, 120 Mass. 403; McMahon v. Smith, 47 Conn. 221; Shenk v. Phelps, 6 Ill. App. 612, 620; Schommer v. Farwell, 56 Ill. 542, 544.

9 Mills v. Mills, 40 N. Y. 543; Devlin v. Brady, 36 N. Y. 531; Gray v. Hook, 4 N. Y. 449; Meguire v. Corwine, 101 U. S. 108; Trist v. Child, 21 Wall (N. Y.) 441; Frost v. Belmont, 6 Allen (Mass.) 152.

10 Ernest v. Crosby, 140 N. Y. 364; Wallace v. Rappleye, 103 Ill. 229, 249; Hanks v. Naglee, 54 Cal. 51; Boigneres v. Boulon, 54 Cal. 146; Brown v. Tuttle, 80 Me. 162.

11 Pettit v. Brown, 107 N. Y. 677; Duval v. Wellman, 124 N. Y. 156; Hartley v. Rice, 10 East 22; Sterling v. Sinnickson, 2 South (N. J.) 756; Chalfant v. Payton, 91 Ind. 202.

12 Atcheson v. Mallon, 43 N. Y. 147; Gibbs v. Smith, 115 Mass. 592; Ray v. Mackin, 100 Ill. 246.

13 Stimson, Am. St. Law § 4132. Most states have constitutional prohibitions against legalizing lotteries. Ibid. § 426. In New York the legislature is forbidden to legalize any kind of gambling. Const., Art. 1 § 9 (1895). 14 The holder has the burden of showing that he took without notice and for a valuable consideration. Vosburg v. Diefendorf, 119 N. Y. 357.

15 If there are two promises, one legal and the other illegal, resting upon one legal consideration, the promisee may waive the illegal promise and enforce the legal one. Erie Railway Co. v. Union Loc. & Exp. Co., 35 N. J. L. 240; United States v. Bradley, 10 Pet. (U. S.) 343, 360-64; Dean v. Emerson, 102 Mass. 480.

2. If a contract contains one legal promise resting upon two considerations, one of which is legal and the other illegal, the promisee cannot enforce the promise, for he cannot legally perform the consideration.16

3.

ways:

The courts may deal with an illegal contract in one of three

(a) Impose a penalty without setting the contract aside; (b) Avoid the contract;

(c) Prohibit the making of the agreement.

4. If one of the parties has no knowledge of the illegal object throughout the transaction, he may recover what may be due him.17 In order that he may not recover, it must be proved that he had intent to participate in the act, as well as the knowledge that it was contemplated.18

CASES.

SECTION VII.-LEGALITY.

Contracts made in breach of statute: Wagers.

LOVE v. HARVEY.

114 MASSACHUSETTS, 80.-1873.

Contract. The plaintiff and the defendant made a bet as to the place of burial in Holyhood Cemetery of the body of one Dr. Cahill, the plaintiff betting that it was buried on the left-hand side of the main avenue, and the defendant betting that it was buried on the right-hand side of that avenue. The money was deposited, twenty dollars by each party, in the hands of one James Stack as stakeholder. It was determined that the body was buried on the left-hand side of the avenue, yet the stakeholder delivered to the defendant the plaintiff's twenty dollars, and the defendant, though requested, refused to repay the same to the plaintiff. The declaration contained another count for money had and received by the defendant to the plaintiff's use. The answer was a general

denial.

16 Bixby v. Moore, 51 N. H. 402; Bishop v. Palmer, 146 Mass. 469; Handy v. St. Paul Globe Co., 41 Minn. 188.

17 Emery v. Kempton, 2 Gray (Mass.) 257. 18 Tyler v. Carlisle, 79 Me, 210.

The presiding judge ruled and instructed the jury that courts did not sit to decide wagers; that it did not matter whether the plaintiff was right or not, regarding the situation of the burialplace in question, or whether the defendant received from the stakeholder the same money that was deposited with him by the plaintiff, if the money was paid and received as money of the plaintiff; that if, before the money was paid over to the defendant, the plaintiff forbade payment thereof in the defendant's presence, then the defendant received it without consideration and wrongfully, and was liable in the action for money had and received.

GRAY, C. J. In England and in New York, actions on wagers upon questions in which the parties had no previous interest were frequently sustained, until the legislature interposed and declared all wagers to be void. 1 Chit. Con. (11th Am. ed.) 735-738; 3 Kent. Com. 277, 278. In Scotland, the courts refused to entertain such actions. Bruce v. Ross, 3 Paton, 107, 112; S. C. cited 3 T. R. 697, 705.

In Massachusetts, the English law on this subject has never been adopted, used, or approved, and, although the question has not been directly adjudged, it has long been understood that all wagers are unlawful. Const. Mass. c. 6, art. 6; Amory v. Gilman, 2 Mass. 1, 6; Ball v. Gilbert, 12 Met. 397, 399; Sampson v. Shaw, 101 Mass. 145, 150; Met. Con. 239. There are decisions or opinions to the same effect in each of the New England States. Lewis v. Littlefield, 15 Maine, 233; Perkins v. Eaton, 3 N. H. 152; Hoit v. Hodge, 6 N. H. 104; Collamer v. Day, 2 Vt. 144; West v. Holmes, 26 Vt. 530; Stoddard v. Martin, 1 R. I. 1, 2; Wheeler v. Spencer, 15 Conn. 28, 30. See also Edgell v. McLaughlin, 6 Whart. 176; Rice v. Gist, 1 Strob. 82.

It is inconsistent alike with the policy of our laws, and with the performance of the duties for which courts of justice are established, that judges and juries should be occupied in answering every frivolous question upon which idle or foolish persons may choose to lay a wager.

The ruling at the trial was therefore correct, and the defendant, having received the money from the stakeholder after notice from the plaintiff not to pay it over, was liable to the plaintiff under the count for money had and received. McKee v. Manice, 11 Cush. 357.

19 See also Bernard v. Taylor, 23 Ore. 416.

Exceptions overrule 1 19