authoritative decision at least, the notes of the rest would be a valid consideration for the note of each subscriber.(w)

SECTION II.

OF FAILURE OF CONSIDERATION.

THE entire failure of consideration, after a note is given, is as complete a defence as an original absence of all consideration.(x) And a partial failure is, under certain circumstances, a partial and proportional defence.(y) We must, however, discriminate between a failure of consideration and a failure of benefit resulting from it. A promises B to do a certain thing, and B makes his note to A in consideration of this promise. Then A fails entirely to perform his promise, but sues B on his note. If B retains A's promise, or if the contract is such that A is always and permanently held on his promise, B cannot defend against the note on the ground of a failure of consideration.(z) But if B cancels

(w) George v. Harris, 4 N. H. 533.

(x) See Jackson v. Warwick, 7 T. R. 121 (and compare it with Grant v. Welchman, 16 East, 207); Mann v. Lent, 10 B. & C. 877; Cuff v. Brown, 5 Price, 297; Knowles v. Parker, 7 Met. 30.

(y) See infra.

(z) In Spiller v. Westlake, 2 B. & Ad. 155, it was held to be no defence to an action by the payee against the maker of a promissory note, that the payee had agreed to convey an estate to the maker in consideration of a sum of money then paid or secured to be paid by the maker (being the sum mentioned in the note), and of a further sum to be paid at a future day, and that such estate had not been conveyed. Lord Tenterden said: "Where, by one and the same instrument, a sum of money is agreed to be paid by one party, and a conveyance of an estate to be at the same time executed by the other, the payment of the money and the execution of the conveyance may very prop erly be considered concurrent acts, and in that case no action can be maintained by the vendor to recover the money until he executes or offers to execute a conveyance; but here the vendee, by a distinct instrumunt, agreed to pay part of the purchase-money on the second of February. I can see no reason why he should have executed a distinct instrument whereby he promised to pay a part of the purchase-money on a particular day, unless it was intended that he should pay the money on that day at all events. In the cases cited, the concurrent acts were stipulated for in the same instrument; here the payment of the £200 (which was part only of the purchase-money) was separately provided for." Parke, J.: "I incline to think that the defence to this action would have been maintainable, if the circumstances had been such that the defendant, having paid the £ 200 as a deposit, would have been so entitled to recover it back; but it is perfectly clear that he could not have been so entitled as long as the contract remained >pen. Now here the contract remained open at the time when the action was com

A's promise, and A accepts this, the contract is so far rescinded and annulled, and then the consideration for the note fails. So if one sells with warranty, and there is a breach, this does not permit the buyer to defend against the note he gave for the price; (a) at least, unless the property proved to be entirely worthless. (b) There should be also, it has been held, an offer to

That was an

menced, for the plaintiffs agreed only to convey the estate subject to the two mortgages. They were never bound to convey the legal estate to the defendant, but merely the equity of redemption; and that they had never refused to convey." In Trask v. Vinson, 20 Pick. 105, where the consideration of the note sued on was the assignment of an agreement to convey certain real estate, Morton, J. said: "The defendant's counsel argues, that if the contractor fails to convey according to the terms of his agreement, this will be a failure of the consideration of the notes. In support of the argument he relies upon the cases of Dickinson v. Hall, 14 Pick. 217, and Rice v. Goddard, 14 Pick. 293. There it was holden that where the consideration of a note was the conveyance of property, real or personal, and the title failed, so that nothing passed by the conveyance, the note was nudum pactum. Those cases were well considered, and are founded on sound principles, and supported by an irresistible current of authorities. With the exception of a few obiter dicta in our own reports, and the case of Lloyd v. Jewell in Maine, 1 Greenl. 352, scarcely a dictum to the contrary can be found, while there is a remarkable coincidence in all the other American and English decisions upon the subject. But those cases are unlike the present. There, the real consideration, the moving cause of the promise to pay, was the estate actually conveyed; here, it is an agreement to convey, at a future time, and upon the happening of a future event. executed, this an executory contract. The rule of damages, too, would be different in the two cases. There, the rule of damages would be the exact amount of the consideration paid; here, it would be the value of the estate at the time it was to be conveyed. There, if the promisor was holden to pay his note, he might recover for the breach of the covenant of seisin precisely the same sum. Here, the damages recoverable on the stipulation or covenant might be more or less than the amount paid or received." In Moggridge v. Jones, 3 Camp. 38, 14 East, 486, A having agreed to execute a lease of premises to B, who was to pay a certain sum for it; and B, who was let into possession, having accepted a bill for the consideration money drawn on him by A; it was held to be no defence to an action on the bill by A against B, that the former refused to execute the lease, but his remedy must be on the agreement. Lord Ellen borough said: "The money agreed upon for the premises would have been payable immediately; but for the convenience of the defendant, the plaintiff agreed to take his acceptances at a future day. This bill must, therefore, be paid in course when due ; and the defendant will have his remedy upon the agreement for the non-execution of the lease." So in Freligh v. Platt, 5 Cowen, 494, where a promissory note was given in consideration of a sale of pews followed with possession in the vendee, it was held to be no defence that the vendor refused to convey. The remedy was by compelling a performance. In Chapman v. Eddy, 13 Vt. 205, it was held to be no defence to a note, that the consideration thereof was a promise, by the payee, to give a deed of a pew, by a certain time thereafter, which was not done within the time specified, nor until after the commencement of the action on the note. And see Wade v. Killough, 3 Stew. & P. 431 ; George v. Stockton, 1 Ala. 136; Read v. Cummings, 2 Greenl. 82. (a) Obbard v. Betham, Moody & M. 483. And see infra, p. 207, note . (b) Shepherd v. Temple, 3 N. H. 455. In this case it was held, that in an action on

The buyer's

return the property and rescind the contract.(c) remedy must be by an action on the warranty. But if there is fraud, this avoids the note, although the buyer may also have his action for the deceit. (d) So it is no defence that the goods for which the note is given are far less in value than was supposed; for this, in the absence of fraud or warranty, would not be either a partial or total failure of consideration, as the buyer takes that risk upon himself. (e) And this might be so even if the loss of value were nearly total, provided the thing supposed to be sold was sold and delivered. If one gave his note for a hundred hogsheads of sugar, and it was found that the sugar had been washed out or otherwise abstracted, in whole or in part, this would be a total or partial failure of consideration. But if the sugar was there, but not so good as the buyer expected, or not worth so much in the market, or even if it were mixed with sand or otherwise deteriorated, not so as to be worthless and unsalable, but so as to be of less value than the buyer expected, this would not be a partial failure of consideration, nor would it, generally,

a promissory note given for the price of goods sold with a warranty, it is a good defence that the goods turned out to be of no value. And see Rumsey v. Sargent, 1 Foster, 399. (c) Thornton v Wynn, 12 Wheat. 183. See Kase v. John, 10 Watts, 107. (d) Lewis v. Cosgrave, 2 Taunt. 2; Solomon v. Turner, 1 Stark. 51; Fleming v. Simpson, 1 Camp. 40, note.

(e) Thus, in Rudderow v. Huntington, 3 Sandf. 252, where goods were sold by an auctioneer, without any warranty or misrepresentation, and the same turned out to be spurious, and the labels upon them counterfeit, it was held, that this was no defence to an action on a note given for the purchase-money, there being no proof that the auctioneer knew the fact of the spurious nature of the goods, or that he had any better means of judging of their genuineness than the buyers possessed. And see Fleming v. Simpson, 1 Camp. 40, note. So in Reed v. Prentiss, 1 N. H. 174, it was held to be no defence to an action on a note, that the article for which it was given proved to be of no value. But had the property never passed, or had fraud been practised, or an express warranty been broken in relation to the article, either of these circumstances might have defeated the action. In Perley v. Balch. 23 Pick. 283, Morton, J. said: "If a chattel be of no value to any one, it cannot be the basis of a bargain; but if it be of any value to either party, it may be a good consideration for a promise. If it is beneficial to the purchaser, he certainly ought to pay for it. If it be a loss to the seller, he is entitled to remuneration for his loss." In Johnson v. Titus, 2 Hill, 606, it was held, that if an article sold be of the slightest value to either the vendor or vendee, it will suffice by way of consideration for a promise to pay the agreed price, however disproportionate to the real value. Accordingly, where one purchased mulberry-trees which turned out to be of no value to him, by reason of being decayed and almost lifeless, it was held, that, as there was neither fraud nor warranty in the case, this constituted no defence to an action on a note given for the price. And see Welsh v. Carter, 1 Wend. 185.

give the promisor any defence or remedy, unless he should prove fraud or misrepresentation, or warranty, express or implied.

So also, it is no defence to an action on a bill of exchange given for the purchase-money of property sold, that, two months after the delivery of the goods to the vendee, the vendor forcibly retook possession of them; for the vendee cannot treat that act as a rescission of the contract, but must bring trespass.(ƒ) We should think, however, that if the vendor retook the goods as an act of rescission, the vendee might assent to this, and then could defend against the note as avoided.

But if a note be given in payment of the price of certain goods sold by the payee to the maker, as of the manufacture or growth of a particular person, and answering certain samples, to be delivered by the payee to the maker within a reasonable time; and the payce fails to deliver goods answering to the description of the contract, this will constitute a complete defence to an action on the note.(g) Under such circumstances, the vendee has a right to rescind the contract; and if the purchase-money had already been paid, he might recover it back.

It has been held, that a note for a patent right cannot be enforced if the patent is void, although the seller sold with it some materials, which, however, had no value to the buyer unless the patent was valid.(h) We should say this is law, although the

(f) Stephens v. Wilkinson, 2 B. & Ad. 320.

(g) Wells v. Hopkins, 5 M. & W. 7. In this case, to an action by the indorsce against the drawer of a bill of exchange, the defendant pleaded that the bill was given in payment of the price of seventeen pockets of hops sold by the plaintiff to the defendant, as hops of a certain grower, and answering certain samples, to be delivered by the plaintiff to the defendant within a reasonable time; that, although a reasonable time had elapsed, the plaintiff had not delivered to the defendant any hops answering the samples, or any hops whatsoever; and that there was no consideration for the bill except as aforesaid. Replication, de injuria. It appeared that the plaintiff had delivered to the defendant seventeen pockets of hops, but inferior to the samples. Held, that the general allegation in the plea, that the plaintiff had not delivered any hops whatever, was immaterial, and might be rejected; and that, without it, the plea showed a total failure of consideration, and was an answer to the action. Held, also, that if the plaintiff relied on the defendant's acceptance of the inferior hops, he ought to have replied it. Alderson, B. said: The latter allegation in the plea was an immaterial one, which need not be proved. It is a total failure of consideration, if there be a bargain for a certain kind of goods to be delivered in a reasonable time, and no such goods are delivered within a reasonable time." And see Bowles v. Newby, 2 Blackf. 364. (h) Bliss v. Negus, 8 Mass. 46; Earl v. Page, 6 N. H. 477; Dunbar v. Marden, 13 N. H. 311; Jolliffe v. Collins, 21 Misso. 338; Geiger v. Cook, 3 Watts & S. 266. In Dickinson v. Hall, 14 Pick. 217, where the purchaser of a patent right gave therefor

authorities are not uniform.(i) So where A appointed B his executor, and gave him a note by way of compensation for the trouble he was to have, and B died first, and his executors sued A, the performance of B's promise to act as A's executor having become impossible, it was held that the consideration had wholly failed.(j) So if, in an action on a note, it appears that for a definite part the note was for a consideration, and for the residue an accommodation note, the payee recovers only for that part which was founded upon consideration.(k)

It is, however, important to observe, that where a partial failure of the consideration is alleged by the defendant, this part must be distinct and definite, for only a total failure or a specific and a certained failure of a part can be availed of by way of defence. For any other, the defendant can only have his set-off or cross action. In several English cases, it is stated generally that a partial failure of consideration is no defence; but they all turn upon the above distinction.() Thus, it is always a good defence,

his promissory note, and the patent proved to be void, the note was held to be entirely without consideration, notwithstanding the vendor covenanted that he had good right to sell and convey the patented privileges, and that he would warrant the same against the claims of all persons. The court were of opinion, "that, the patent right being void, there was a total want of consideration for the defendant's promissory note, unless the plaintiff's alleged covenant of title in the patent right constituted a consideration; that such a covenant would not constitute a valid consideration, for the object of the defendant in making this contract was to obtain, not a mere covenant, but the conveyance of a patent right; that, although the plaintiff might have purchased and sold the supposed patent right thinking it to be valuable property, still he could not recover in this action, for the defence did not rest on the ground of fraud, but on the ground that the defendant had received no value, and his promise was nudum pactum."

(i) See Williams v. Hicks, 2 Vt. 36.

(j) Solly v. Hinde, 2 Cromp. & M. 516.

(k) Darnell v. Williams, 2 Stark 166; Barber v. Backhouse, Peake, 61; Cline v. Miller, 8 Md. 274.

(/) Thus, in Morgan v. Richardson, 1 Camp. 40, note, which was an action against the acceptor of a bill of exchange at the suit of the drawer, the bill being payable to his own order, the defence was, that the bill had been accepted for the price of some hams bought by the defendant from the plaintiff, to be sent to the East Indies; and that the hams had turned out so very bad that they were almost quite unmarketable. The sum for which they actually sold was paid into court. Lord Ellenborough held, that though, where the consideration of a bill of exchange fails entirely, this will be a sufficient defence to an action upon it, by the original party, it is no defence to such action that the consideration fails partially; but that under such circumstances the giver of the bill must take his remedy by an action against the person to whom it is given. So in Tye v. Gwynne, 2 Camp. 346, in an action on a bill of exchange accepted for the price of goods purchased for exportation, it was held, that the purchaser could not give in cvi.