[At a family celebration and in the presence of family and invited guests, William E. Story, Sr., the uncle of William E. Story, 2d, promised his nephew that if he would refrain from drinking, using tobacco, swearing, and playing cards or billiards for money until he was 21 years old, the uncle would pay him $5,000. The nephew agreed and abided by the terms of his uncle's promise. When the nephew asked for his money, the uncle replied that he fully intended to hand over the $5,000, but that he felt that he should keep the money until the nephew got his feet on the ground. The nephew never received the money; eventually he transferred his right to receive the $5,000 plus interest to another person named Hamer. Presumably Hamer was willing to give him immediate cash, say, $4,000. Before Hamer could collect the $5,000 plus interest from the uncle, the uncle died. So, in the opinion excerpted below, Hamer is suing Sidway, who is the executor of the uncle's estate, to recover $5,000 plus interest.
On his 21st birthday the nephew William E. Story, 2d, wrote to his uncle, William E. Story, Sr., to tell him that he had performed his part of the promise and thought he was entitled to the $5,000. The uncle shortly thereafter wrote the following letter to his nephew:
"Buffalo, Feb. 6, 1875, W. E. Story, Jr.--
Dear Nephew; Your letter of the 31st ult. came to hand all right, saying that you had lived up to the promise made to me several years ago. I have no doubt but you have, for which you will have five thousand dollars, as I promised you. I had the money in the bank the day you was [sic] twenty one years old that I intend for you, and you have the money certain. Now Willie, I do not intend to interfere with this money in any way till I think you are capable of taking care of it, and the sooner that time comes the better it will please me. I would hate very much to have you start out in some adventure that you thought all right and lose this money in one year. The first five thousand dollars that I got together cost me a heap of hard work ... This money you have earned much easier than I did, besides, acquiring good habits at the same time, and you are quite welcome to the money. Hope you will make good use of it. I was ten long years getting this together after I was your age ... Truly yours, W. E. Story.
P. S. You can consider this money on interest."
The nephew received the letter, and thereafter consented that the money should remain with his uncle in accordance with the terms and conditions of the letter. The uncle died on the 29th day of January, 1887, without having paid over to his nephew any portion of the said $5,000 and interest. Sometime after February, 1875, the nephew had transferred his entitlement to Hamer, who has presented the claim for the money to Sidway, the executor of the uncle's estate.]
PARKER, J. ... The defendant contends that the contract was without consideration to support it, and therefore invalid. He asserts that the promisee, by refraining from the use of liquor and tobacco, was not harmed, but benefited; that that which he did was best for him to do, independently of his uncle's promise,--and insists that it follows that, unless the promisor was benefited, the contract was without consideration,--a contention which, if well founded, would seem to leave open for controversy in many cases whether that which the promisee did or omitted to do was in fact of such benefit to him as to leave no consideration to support the enforcement of the promisor's agreement. Such a rule could not be tolerated, and is without foundation in the law ... ‘Consideration' means not so much that one party is profiting as that the other abandons some legal right in the present, or limits his legal freedom of action in the future, as an inducement for the promise of the first."
Now, applying this rule to the facts before us, the promisee used tobacco, occasionally drank liquor, and he had a legal right to do so. That right he abandoned for a period of years upon the strength of the promise of the testator that for such forbearance he would give him $5,000. We need not speculate on the effort which may have been required to give up the use of those stimulants. It is sufficient that he restricted his lawful freedom of action within certain prescribed limits upon the faith of his uncle's agreement, and now, having fully performed the conditions imposed, it is of no moment whether such performance actually proved a benefit to the promisor, and the court will not inquire into it; but, were it a proper subject of inquiry, we see nothing in this record that would permit a determination that the uncle was not benefited in a legal sense.
a. The court held that the nephew should be paid the sum promised, even though the promise appeared to have been made informally at a family gathering where toasts and other gestures of goodwill were part of the celebration. How will courts decide which promises are made in earnest and which promises are frivolously made?
b. In this case the parties to the promise were uncle and nephew. Should courts be more reluctant to enforce promises between family members than between strangers?
c. The court indicates that its decision turns on the fact that the nephew had relied on the uncle's promise. Would any type of reliance make the promise of a gift into an enforceable promise? Or must the reliance be "reasonable" under the circumstances?
d. The court in this case indicates that the nephew's abstinence from liquor and tobacco was something of value foregone by the nephew in reliance upon the uncle's promise. Did the uncle benefit from his nephew's reliance? Did the court hold that the uncle must benefit from the reliance in order for his promise to be enforceable?
e. Suppose that instead of making demands on the nephew, the uncle simply promised to give the money, without conditions, as soon as the nephew turned 21 years old. This is the promise of a pure gift. Is there consideration? Would such a promise be enforceable under the bargain theory? Should courts enforce such promises?