Hamer v. Sidway
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| Hamer v. Sidway | ||||||||
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 New York Court of Appeals |
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| Argued February 24, 1891 Decided April 14, 1891 |
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| Respondent's forbearance of legal rights on the promises of future benefit made by Petitioner could constitute valid consideration. | ||||||||
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Hamer v. Sidway, 124 N.Y. 538, 27 N.E. 256 (N.Y. 1891), was a decision by the New York Court of Appeals (the highest court in the state) written by Judge Alton Parker. Hamer v. Sidway is an important case in contract law which established that forbearance of legal rights (voluntarily abstaining from legal rights) on promises of future benefit made by other parties can constitute valid consideration.
[edit] Facts
Louisa Hamer, (Plaintiff), brought suit against the executor of the estate of William E. Story I, (Defendant), for the sum of $5,000 dollars. On March 20, 1869, William E. Story had promised his nephew, William E. Story II, $5,000 dollars if his nephew would abstain from drinking, using tobacco, swearing, and playing cards or billiards for money until the younger became 21 years of age. Story II accepted the promise of his uncle and did refrain from the list of prohibited acts until he turned the agreed upon age of 21. After celebrating his 21st birthday on January 31, 1875, Story II wrote to his uncle and requested the promised $5,000 dollars. The uncle wrote a letter back to his nephew on February 6, 1875 in which he told his nephew that he would fulfill his promise. Story I also articulated that he would prefer to wait until his nephew was older before actually handing over the (then) extremely large sum of money. The elder Story also noted within his letter that the money owed to his nephew would accrue interest while he held it on his nephew's behalf.
The younger Story consented to his uncle's wishes and agreed that the money would remain with his uncle until Story II became older. William E. Story I passed away on January 29, 1887 without having transfered any of the money owed to his nephew. Louisa Hamer later acquired Story II's $5,000 dollar interest on assignment. The uncle's estate refused to grant Hamer the money, believing there was no binding contract due to a lack of consideration. As a result, Hamer sued the estate's executor, Franklin Sidway.
[edit] Opinion of the court
The Court of Appeals reversed and directed that the judgment of the trial court be affirmed, with costs payable out of the estate.
Parker, writing for a unanimous court, wrote that the forbearance of legal rights by Story II, namely the consensual abstinence from “drinking liquor, using tobacco, swearing, and playing cards or billiards for money until he should become 21 years of age” constituted consideration in exchange for the promise given by Story I. Because the forbearance constituted valid consideration given by a party on a promise to perform by another party, the promisee was contractually obligated to fulfill the promise.
Parker cited the Exchequer Chamber’s 1875 definition of consideration: "A valuable consideration in the sense of the law may consist either in some right, interest, profit or benefit accruing to the one party, or some forbearance, detriment, loss or responsibility given, suffered or undertaken by the other."
The executor of Story I’s estate, Sidway, was therefore legally bound to deliver the promised $5,000 dollars to whomever currently held the interest in the sum, which by the time of the trial was Louisa Hamer.
[edit] Influence of the case
Hamer is very common reading for first-year contracts law school students in many jurisdictions.
