Summary
finding that “ doubtful or disputed claim, sufficient to constitute a good consideration for an executory contract of compromise, is one honestly and in good faith asserted, arising from a state of facts on which a cause of action can be predicated, with a reasonable belief on the part of the party asserting it, that he had a fair chance of sustaining his claim, and concerning which an honest controversy may arise, although, in fact, the claim may be wholly unfounded”
Summary of this case from Simrall v. Bunge-Ergon Vicksburg LLCOpinion
No. 30399.
May 1, 1933. Suggestion of Error Overruled, June 12, 1933.
1. CONTRACTS.
Any consideration not a promise is sufficient to support promise, except surrender of, or forbearance to assert, invalid claim without honest and reasonable belief in validity thereof.
2. CONTRACTS. Forbearance to assert claim which might reasonably be doubtful is sufficient consideration to support promise.
A "doubtful claim" sufficient to constitute a good consideration for executory contract of compromise is one honestly and in good faith asserted, arising from a state of facts on which a cause of action can be predicated, with a reasonable belief on the part of the party asserting it that he had a fair chance of sustaining his claim, and concerning which an honest controversy may arise, although, in fact, the claim may be wholly unfounded.
3. WILLS.
Where oral contract to forbear will contest was established, party asserting invalidity based on absence of consideration had burden of proof.
4. WILLS.
Whether there was sufficient consideration for agreement to pay money under contract to forbear will contest, based on existence of doubtful claim, held question for jury (Code 1930, section 1609).
APPEAL from the Circuit Court of Wayne County.
Fishel Stevens, of Hattiesburg, and Arthur G. Busby, of Waynesboro, for appellants.
It was error to grant the peremptory instruction.
American Trading Co. v. Ingram-Day Lumber Co., 69 So. 707, 110 Miss. 31; New Orleans N.E.R. Co. v. Jackson, 105 So. 770, 140 Miss. 375; New Orleans N.E.R. Co. v. Martin, 105 So. 864, 140 Miss. 410; Mobile O.R. Co. v. Clay, 125 So. 819, 156 Miss. 463, certiorari denied Clay v. Mobile O.R. Co., 51 S.Ct. 24, 282 U.S. 844, 75 L.Ed. 749; Gulf S.I.R. Co. v. Prine, 118 Miss. 571, 100 So. 521; New Orleans, etc., R. Co. v. Penton, 135 Miss. 571, 100 So. 864; Yates v. Houston, 141 Miss. 881, 106 So. 110.
In granting a peremptory instruction, the court must assume as true the testimony of the party against whom the peremptory instruction is given, and must draw all favorable inferences for such party which might reasonably be drawn by a jury.
Lowe v. Mobile O.R. Co., 149 Miss. 889, 116 So. 601; Wager v. East Coast Hospital Assn., 141 So. 743; Lee County Gin Co. v. Middlebrooks, 137 So. 108, 161 Miss. 422; Fatheree v. Griffin, 121 So. 119, 153 Miss. 570.
We submit that the record discloses that there was a valid and binding contract made in the home of the heirs. The proposition made by the defendant and his sister was that if the heirs would not contest the will of Roann Sumrall, that they would divide this ten thousand dollars ($10,000) to each of them equally among the other children, and this proposition was accepted by the plaintiffs, and thereupon the defendant and his sister paid to each of the heirs sixty dollars ($60), or, in other words, divided four hundred and eighty dollars ($480) among all eight of the heirs of Roann Sumrall.
It may be laid down as a general rule that there is a sufficient consideration for a promise if there is any benefit to the promisor or any loss or detriment to the promisee.
13 C.J. 315 (150) C.; Byrne v. Cummins, 41 Miss. 192; O'Neil v. Berry, 25 Miss. 9; Magee v. Catchings, 33 Miss. 672; Keith v. Miles, 39 Miss. 442.
An attempt to define consideration as used in the law of contracts has been made by saying that it consists in what is actually given or suffered and accepted for a promise.
6 R.C.L. 652.
A long series of decisions has established the rule that a benefit to the promisor or a detriment to the promisee is a sufficient consideration for a contract.
6 R.C.L. 654; Hind v. Holdship (Pa.), 2 Watts 104, 105, 26 Am. Dec. 107; Thomas v. Thomas, 2 Q.B. 851, 859, 42 R.C.L. 945, 114 Reprint 230; Kirkpatrick v. Muirhead, 16 Pa. 117, 126 (quot, In re Dutton, 181 Pa. 426, 436, 37 A. 582); Doyle v. Dixon, 97 Mass. 208, 213; Ricketts v. Scothorn, 57 Nebr. 51, 54, 77 N.W. 365, 73 Am. St. Rep. 491, 42 L.R.A. 794; Marr v. Burlington, etc., R. Co., 121 Iowa 117, 96 N.W. 716; Harlan v. Harlan, 102 Iowa 701, 72 N.W. 286.
A test of good consideration for a contract is whether the promisee at the instance of the promisor, has done, forborne, or undertaken to do anything real, or whether he has suffered any detriment, or whether in return for the promise, he has done something that he was not bound to do, or has promised to do some act or to abstain from doing something.
Presbyterian Bd. of Foreign Missions v. Smith, 209 Pa. 361, 58 A. 689.
Permitting a party to control suit is a sufficient consideration.
Goodspeed v. Fuller, 71 Am., sec. 572, 46 Me. 141; Case v. Kinney, 7 Ohio Dec. (Reprint) 178.
Forbearance to sue is a good consideration.
When a person bona fide believes he has a fair chance of success in a suit against another, his forbearance to sue constitutes a good consideration.
Henderson v. Kendrick et al., 89 So. 635; Callisher v. Bischoffsheim, L.R. 5 Q.B. Cas. 449, text 452; 6 R.C.L. 656; 13 C.J. 324; 12 C.J. 324.
Compromise or modified contract in settlement of bona-fide dispute as to doubtful claims constitutes binding agreement.
D.L. Fair Tie Co. v. Warrell, 112 So. 24, 147 Miss. 412.
Compromises having for their object the settlement of family difficulties or controverses are favored at law and in equity if at all reasonable.
12 C.J. 322, 324; Layer et al. v. Layer et al., 184 Mich. 663, 151 N.W. 759; Marsant v. Marsant (Kan.), 57 P. 958; Merkert v. Grobe (Iowa), 90 N.W. 490; Schoonmaker v. Gray, 208 N.Y. 209, 101 N.E. 886.
Arthur G. Busby, of Waynesboro, for appellants.
It is undisputed that the appellants in the case at bar were honest in their belief that they could successfully contest the will and that appellee was at least doubtful as to whether appellants would or would not be successful and therefore, paid them the eighty dollars each at the time of the contract to hold the contract with a further promise to divide the twenty thousand dollars as soon as the will was established in the October term of chancery court, 1931. It is also admitted that the declaration filed by appellants shows this fact.
Sanford v. Huxford, 32 Mich. 313, 20 Am. Rep. 647.
If parties act in good faith, even where they know all the facts, and there is a promise without legal liability to base it on, the courts hesitate to disturb the agreement of parties on any assumption that an advantage which they have obtained and conceived to be worth paying for is not considered valuable.
Paris v. Dexter, 15 V.T. 349; Wade v. Simeon, 2 C.B. 565; Gould v. Armstrong, 2 Hall (S.C.) 267.
The compromise of a suit is a sufficient consideration.
Cook v. Wright, 1 B. S. 559; Union Bank v. Gary, 5 P.E.T. 113.
In Longridge v. Dorville, 5 B. D. Ald. 117, it was held a compromise would not fail unless it was clear there could be no possible liability.
Sullivan v. Collins, 18 Iowa 228.
Agreement by beneficiaries under a will with an heir at law, who is cut off by the will and threatens to contest it on the ground of undue influence to pay him money, in consideration of his desisting, is valid if the heir at law honestly thought he had reasonable ground for setting up the claim.
Bellows v. Sowles, 55 Vt. 391, 45 Am. Rep. 621.
We find from all cases cited by appellee that none are cases where brothers and sisters are litigating on an estate left by their parents; all of the cases cited by appellee seem to be cases where the plaintiff had no right whatever to recover.
It is the policy of the law to encourage and facilitate amicable adjustment by families of disputes as to their interest in common property or the division of such property according to the agreement of all parties or interests.
Hodge et al. v. Joy et al. (Ala.), 92 So. 171.
Shannon Schauber, of Laurel, for appellee.
Our contention is that there was no valid consideration for the promise made by appellee to appellants and for that reason the plaintiffs cannot recover in this suit.
13 C.J. 345, sec. 195.
There are a few American cases which seem to support the early English cases which hold that one has a right to sue only when his claim is actually in law a valid claim, and that forbearance to sue on an unfounded claim can never support a promise given therefor.
Foster v. Metts, 55 Miss. 70; Newell v. Fisher, 11 S. M. 431; Prater v. Miller, 25 Ala. 320, 60 Am. Dec. 521; Sharp v. Rogers, 12 Minn. 174; House v. Callicott, 83 Miss. 506; Fetterman case, 139 So. 406, 162 Miss. 547; Montgomery v. Grenier et al., 117 Minn. 416, 136 N.W. 9.
It was held in Neibles v. Railway Co., 37 Minn. 151, 33 N.W. 332, that to sustain a compromise and settlement it must appear that the claim or controversy settled, though perhaps not in fact valid in law, was presented and demanded in good faith and upon reasonable grounds for inducing the belief that it was enforceable. And the rule thus stated is the prevailing one in this country. It has been applied in numerous cases involving the settlement of the estate of deceased persons; the courts holding that a claim presented against the estate, a promise to refrain from attempting by legal proceedings to enforce which forms the basis for a settlement, must have some plausible or reasonable ground for its support — facts sufficient to justify a good faith belief in the merits of the claim or demand.
Crawford v. Engram, 157 Ala. 314, 47 So. 712; Prater v. Miller, 25 Ala. 320, 60 Am. Dec. 521; Bellows v. Sowles, 55 Vt. 391, 45 Am. Rep. 621; Busby v. Conoway, 8 Md. 55, 63 Am. Dec. 688; House v. Callicott, 83 Miss. 506, 35 So. 761.
It has been declared that a promise in consideration of forbearance is not binding if there was originally no cause of action, or if the claim threatened to be enforced is invalid and worthless.
6 R.C.L. 661.
Counsel in their brief asked that the case be reversed because the alleged consideration was a family settlement. We call the court's attention to the fact that each of the appellants, who were the plaintiffs in the court below, had not lived with their father for more than twenty-five years and that each of them was of mature years and maintained a home of his or her own.
"An agreement on the part of a brother of a deceased person with another brother and sister to refrain from contesting the will of decedent in consideration of the promise of the latter, beneficiaries named in the will, to pay him a certain sum of money, is not, on the facts stated in the opinion, a `family settlement,' within the meaning of the law upon that subject."
Montgomery v. Grenier, 136 N.W. 9, 10, 117 Minn. 416; Words and Phrases (2d Ser.), p. 467.
Argued orally by E.C. Fishel and Arthur G. Busby, for appellants, and by C.R. Shannon, for appellee.
Mrs. Fannie Sumrall Stanley, Mrs. Carrie Sumrall Sanderson, Mrs. J.F. Jeffcoat, W.H. Sumrall, D.W. Sumrall, and Archie Sumrall, appellants here, each brought suit in the court below against Lorenzi Sumrall, filing separate declarations, each suit for the sum of one thousand two hundred fifty dollars; the basis of said suits being an oral contract by which the appellants agreed to forbear contesting the will of their father, Roann Sumrall, who died testate on March 11, 1931, leaving as his heirs at law the parties plaintiff in the court below, appellants here, together with the appellee, Lorenzi Sumrall, and his sister, Clara Sumrall. By order of the court, the suits were consolidated and tried as one. The defense to this suit was that there was no consideration for the oral contract. From a judgment in favor of appellee, appeal was taken to this court.
The plaintiffs' evidence establishing the alleged oral contract is as follows: After the funeral of their father, Clara Sumrall told her brothers and sisters that their father had left a will in which he gave to her and her brother, Lorenzi Sumrall, each ten thousand dollars more than was given to the other children, and, in addition, some farm land. Thereupon a spokesman for the less favored children announced that he did not believe that to be his father's will, and that they would contest the will. A contract was entered into, on Lorenzi's proposition, that Lorenzi and Clara would divide the twenty thousand dollars bequeathed to them equally among all the heirs at law, if the appellants would agree not to contest the will, the money to be paid over to them on Wednesday after the term of the chancery court in Wayne county, to be held in October, 1931.
Under the will of the testator, after the special devise, as stated, of land, and of ten thousand dollars each to Clara and Lorenzi Sumrall, the balance of the estate was to be held in trust for the benefit of all the children of decedent. The amount of the personal estate, in addition to the lands devised to Clara and Lorenzi Sumrall, was about fifty thousand dollars. The agreement in nowise affected the bequest in trust.
In addition to these facts, it was shown that about a year before the execution of the will Roann Sumrall had become feeble, and some of the heirs testified to circumstances indicating, as they believed, that their father was incapable of executing a will. Also it was suggested that Clara and Lorenzi Sumrall, who had lived with their father for many years, might have exercised undue influence. The appellants had been married for many years, and lived some distance from their father, whom they did not see often. The contract here involved was made before any investigation of the father's mental capacity, and of the conditions under which the will was executed. The will was duly probated, and was not contested. When the time for the payment of the money under the agreement arrived, Lorenzi and Clara Sumrall declined to abide by their oral contract with the appellants.
For the purpose of considering this case, it must be assumed that the contract was established, and that the appellants had abided by the oral contract in not contesting the will.
The court below excluded the evidence of the appellants, and granted the appellee a peremptory instruction, and judgment was rendered accordingly. The peremptory instruction apparently was granted on the theory that the rule in this state is that forbearance to assert a claim is not a sufficient consideration, unless the claim is, in fact, valid in law; and, if there is such a rule in this jurisdiction, the peremptory instruction was proper. After examining the authorities, we have reached the conclusion that this rule has not been approved by this court.
We adopt the rule set forth in the American Law Institute, in its "Restatement of the Law of Contracts," section 76 of the official draft thereof, to the effect that any consideration that is not a promise is sufficient to support a promise, except the following: "`(b) The surrender of, or forbearance to assert an invalid claim or defense by one who has not an honest and reasonable belief in its possible validity.' In the explanatory note to this section, it is said: `How far the validity of the claim foreborne or surrendered to the test of the sufficiency of the forbearance or surrender as consideration, and how far the promisee's honest belief in his claim is enough has been the subject of much litigation. Under the early law the claim must have been valid; then it was said to be enough if it was doubtful in fact or law, and many American cases still state this as the test. The modern English law, followed by not a few American cases, makes the honesty of the claimant the test. In practically all of such cases however, the claim was not wholly unreasonable. Subsection (b) is supported by abundant authority.'" Fetterman v. Lbr. Mfg. Co., 162 Miss. 553, 139 So. 406.
The rule is sometimes expressed in this language: That forbearance to assert a claim which might reasonably be doubtful is sufficient consideration to support a promise.
When the words "doubtful claim" are defined, there can be but faint distinction, if any, between the rule just quoted and the rule controlling in Mississippi in its practical application. What, then, is a doubtful claim? We adopt the following as the correct definition: "A doubtful or disputed claim, sufficient to constitute a good consideration for an executory contract of compromise, is one honestly and in good faith asserted, arising from a state of facts on which a cause of action can be predicated, with a reasonable belief on the part of the party asserting it, that he had a fair chance of sustaining his claim, and concerning which an honest controversy may arise, although, in fact, the claim may be wholly unfounded." 11 C.J., p. 816, note 30-a. See Sharp v. Bowie, 142 Cal. 462, 76 P. 62.
The following cases have been considered by us in reaching our conclusion: Newell v. Fisher, 11 Smedes M. 431, 49 Am. Dec. 66; Waul v. Kirkman, 13 Smedes M. 599; Lindsey v. Sellers, 26 Miss. 169; Foster v. Metts, 55 Miss. 77, 30 Am. Rep. 504; Boone v. Boone, 58 Miss. 820; Gunning v. Royal, 59 Miss. 45, 42 Am. Rep. 350; Sanford v. Starling, 69 Miss. 204, 10 So. 449; and House v. Callicott, 83 Miss. 506, 35 So. 761. In all these cases we are of the opinion that forbearance to assert a claim, unenforceable either at law or equity, is not sufficient consideration to support a promise.
In the case of Fetterman v. Badger Lbr. Mfg. Co., 162 Miss. 547, 139 So. 406, 407, attention was called to the language of the court in the case of Gunning v. Royal, supra, which might be construed to militate against what we have said, which language is as follows: "It was said that the existing dispute `or controversy between parties is not a sufficient consideration to support a promise to pay money in settlement of it, where no valid demand for anything whatever exists in favor of the promisee. There must be a valid demand to some extent, or for something, to uphold a promise of this kind. Giving a note to settle a dispute or controversy does not impose any liability on the maker, if he gains nothing and the payee loses nothing by it.'" This was the language of Judge CAMPBELL, speaking for the court, and he cited with approval, in support of that view, the cases of Foster v. Metts, and Boone v. Boone, supra.
However, it will be observed that, despite the language just quoted, that court adhered to the rule that there was absolutely no merit in the claim for which the note was given. It will be necessary then to see what rule Judge CAMPBELL applied, and reference to the case of Boone v. Boone, supra, shows that Judge CAMPBELL tersely stated the rule in the following words: "`The compromise of doubtful rights is a sufficient consideration for a promise to pay money.' Foster v. Metts, 55 Miss. 77 (30 Am. Rep. 504). It is sufficient that the claim be doubtful. A mere controversy between the parties is held not to be sufficient. In the case cited, it was disclosed that the note was given for forbearance to sue on a claim which was not maintainable, and therefore it was without consideration."
It will thus be seen that the distinguished judge recognized the rule to be that there must be a doubtful claim. The definition which we have hereinabove given of a doubtful claim, as quoted, if we read "doubtful claim" for "doubtful rights," would be to all practical effects the same as announced in Restatement of Law, as quoted by us. So we think the statement of the rule in American Law Institute is supported by the language of Judge CAMPBELL in the Boone case, which was not withdrawn by him in the Gunning case. He was simply applying the facts of that case to the law as declared in the Boone case.
In the case of House v. Callicott, 83 Miss. 506, 35 So. 761, the rule we have adopted is clearly approved. In the case at bar, by virtue of section 1609, Code of 1930, the plaintiffs in the court below were heirs at law of their father, and unquestionably had a right to bring suit to contest their father's will as interested parties. There is no evidence to show that in making this compromise they did not act honestly and in good faith, and in the reasonable belief that they could maintain their claim that the will was not the product of their father's brain. The burden of proof was upon the appellee to show no consideration, once the appellants had established a prima-facie case, to-wit, the contract. Boone v. Boone, 58 Miss. 820, supra.
Courts of equity have long settled the rule here announced, especially with respect to family settlements. See Parker v. Broadus, 128 Miss. 699, 91 So. 394; Blount v. Wheeler, 199 Mass. 330, 85 N.E. 477, 17 L.R.A. (N.S.) 1036; and Grochowski v. Grochowski, 77 Neb. 506, 109 N.W. 742, 13 L.R.A. (N.S.) 484, 15 Ann. Cas. 300. But we are not here called on to say whether or not we would enforce this rule of equity in a common-law court. The case at bar is one for the jury.
Reversed and remanded.