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(—Mass. —,

152 N. E. 623.)

the report of the auditor and rested. All other evidence was introduced by the defendants. The judge refused to instruct the jury in accord with requests of the plaintiff, refused to order a verdict in accord with the auditor's report for the plaintiff, and submitted to the jury two issues of fact upon a charge confined to those issues. The jury found upon the first of these issues that Henry P. Nawn did not sign the originals of certain exhibits. This made a finding upon the second issue unnecessary. Thereupon the judge ordered and the jury returned a verdict for the defendants. The plaintiff saved exceptions to these refusals and order. There was evidence that in 1900 one John J. Nawn, a cousin of the deceased Henry P. Nawn, was indebted to a partnership, Cavanaugh Brothers, in the amount claimed in the declaration. He also was in debt to Henry P. Nawn, and owed the Shawmut National Bank $5,100 on a note endorsed by Henry Nawn and Cavanaugh Brothers. Under date of February 7, 1900, he deeded certain pieces of real estate to Henry P. Nawn who, as a condition of the delivery of the deeds to himself, executed a declaration of trust under seal which declared that the conveyances were made to him "to sell and turn into cash, and pay up all the debts of John J. Nawn to whomsoever owed, including especially a loan of $5,100, to the National Shawmut Bank, upon which Cavanaugh Brothers and I are liable, and debts due me and said Cavanaugh Brothers" and concluded as follows: "I hereby promise, covenant and agree to and with the said John J. Nawn that I will turn over to the said John J. Nawn, or his wife, any net proceeds from the property over and above what I may use to pay said debts, or any other debts owed by said John J. Nawn or wife, after deducting reasonable costs and expenses." This instrument was kept by one of the Cavanaugh brothers. Under date of December 22, 1903, Henry Nawn re

conveyed the premises (except one parcel lost by a foreclosure of a mortgage to which it was subject when received by Henry Nawn) to John J. Nawn, and received two mortgages, one for $4,500, and one for $5,993.25, on the separate parcels, both of which bore interest at six per cent. and were for the term of one year. The deeds of conveyance to Henry Nawn were recorded February 25, 1901, while the reconveyance and mortgages were recorded January 15, 1904. Cavanaugh Brothers did not know of the reconveyance and mortgages till 1915. In 1916 Cavanaugh Brothers organized the plaintiff corporation, and assigned to it the firm's outstanding accounts on January 25, 1916. Some time before September, 1918, the declaration of trust, which had been lost for years and whose existence at any time had been denied by Henry Nawn, was found; and on September 24, 1918, it was taken to him with a statement from the books of Cavanaugh Brothers of the account against John J. Nawn and shown to him. He is said then to have acknowledged the signature and promised to pay the account. On November 1, 1918, one of the Cavanaugh brothers, then an officer of the plaintiff corporation, went to Henry Nawn at his home, taking with him a transcript of the accounts against John J. Nawn (the original of Exhibits 1, 2 and 3 at the trial) which showed at the bottom a balance due of $3,913.08, and the declaration of trust. On this occasion there was written at the foot of the account under the balance: "I will pay this account. H. P. Nawn, Witness M. A. Cavanaugh;" all but the signature being in the handwriting of Cavanaugh.

December 16, 1919, Henry Nawn assigned the mortgage for $5,993.25 to William A. Gaston, then an officer of the National Shawmut Bank, who discharged it on August 12, 1921. On September 26, 1921, Henry Nawn discharged the mortgage for $4,500. Both discharges were recorded November 10, 1921. Hen

ry P. Nawn died in March, 1922. This action was begun March 29, 1923.

The exceptions must be overruled.

Accountswhen action lies.

The action is at law on an account stated. Such an action lies only where there have been transactions previous to the statement of the account which create a relation of debtor and creditor. Chase v. Chase, 191 Mass. 556, 78 N. E. 115; Tucker v. Columbian Nat. Bank, 232 Mass. 224, 229, 122 N. E. 285. It is inapplicable to enforce a promise to pay the debt of another. French v. French, 2 Mann. & G. 644, 133 Eng. Reprint, 903. The promise here is to pay the debt of John J. Nawn.

-action to compel payment.

Parties-who can enforce promise to pay debt.

The plaintiff contends, however, that it has acquired a right to sue by virtue of the declaration of trust signed by Henry Nawn in 1900. That declaration is under seal. The only promise which it contains is a promise to John J. Nawn. He is the who only person can sue upon it. A third person cannot maintain an action on a sealed instrument to which he is not a party. Millard v. Baldwin, 3 Gray, 484; Boyden v. Hill, 198 Mass. 477, 487, 85 N. E. 413; Forbes v. Thorpe, 209 Mass. 570, 581, 95 N. E. 955.

-right to enforce promise under seal.

Moreover, if there had been in that declaration any promise to pay the plaintiff's assignor, it would have been terminated in 1920 by operation of the statute of limitations now embodied in Gen. Laws, chap. 260, § 2. Only a new promise in writing signed by the party to be charged could take away the bar of that statute. Gen. Laws, chap. 260, § 13. The jury has found that no such new promise existed.

If the reconveyance made in 1903 was a breach of trust, any right at law or in equity to proceed against

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92 Am. Dec. 795), so that the bar would be complete in 1910. But if, because the Cavanaugh Brothers were ignorant in regard to it (O'Brien v. O'Brien, 238 Mass. 403, 411, 131 N. E. 177), the statute did not begin to run until 1915, when they learned actually of the reconveyance, the bar was complete in 1921 (Young v. Walker, 224 Mass. 491, 113 N. E. 363).

There was evidence to justify the finding by the jury. The plaintiff contends that the finding by the auditor must control in the absence of affirmative evidence to impeach it. Greenburg v. Stoehrer & P. Dodgem Corp. 250 Mass. 410, 433, 145 N. E. 824. There is such affirmative evidence in reasonable inference to be drawn from the


pay debt.

statements of Henry Nawn in his life- of promise to time, put in evidence by the defendants, denying any promise, taken with the conduct of the parties as disclosed in the evidence hereinbefore stated. Wyman v. Whicher, 179 Mass. 276, 60 N. E. 612. The questions, what was to be believed, and what inferences. were proper, were for the jury.

The fourth request for instructions was waived. No claim of fraud on the part of Henry Nawn is made. What has been said disposes of the exceptions taken to the refusal to instruct as requested.

The judge could not have directed a verdict for the plaintiff rightly. Upon the finding of fact made by the jury, after instructions to which no exception was saved, he was right in directing a verdict for the defendants.

Exceptions overruled.


Right of third person to maintain action at law on sealed instrument.

I. Introductory, 5.

[Parties, § 10.]

II. View that third party cannot maintain action in own name:

a. In general, 6.

b. Applications; illustrations of general rule, 9.

c. Statutory changes, 13.

d. New York cases, 15.

III. View that third party may sue:

a. In general, 20.

b. Applications and illustrations, 23. IV. Conclusion, 24.

I. Introductory.

tract is of such a nature as to constitute the promisor a trustee for the benefit of such person; but in a majority of jurisdictions in this country the contrary rule prevails; stated in general terms, leaving out limitations recognized in various jurisdictions, the rule is (in some states embodied in statutes) that a third person may enforce a promise made for his benefit even though he is a stranger both to the contract and the consideration. 6 R. C. L. 882, § 271.

Probably no question in the law of contracts has involved the courts in more difficulties than the frequently discussed question of the right of one not a party to a contract intended for his benefit to maintain an action thereon in his own name. The early common law denied absolutely that any such right existed. This rule had its origin in the early conception of assumpsit, limiting the action to the person from whom the consideration moved. 2 Elliott, Contr. 1411. The ancient rules were, however, relaxed to some extent, yet down to the present time conflicting rules are advanced in the different jurisdictions, and varying theories are indulged in by the courts in sustaining or denying the right to sue. These varying attempts at theoretical analysis, and the contrary results reached, as well as the fact that this question has been also a source of trouble and confusion in the Roman law and the modern civil law, show the inherent difficulty of determining strictly to a discussion of the right

the legal rights under such contracts. 1 Williston, Contr. § 347. At present the English rule, which is followed in several American jurisdictions, seems to be (aside from the possible exception where there is close relation between the promisee and the person from whom the consideration moves [see 6 R. C. L. 892]) that, notwithstanding a contract may have been intended for the benefit of a third person, he cannot enforce the promise if he is a stranger to both the contract and the consideration, unless the con

The object of this annotation is to discuss the application of this general rule to actions by third persons on contracts under seal. For the purposes of this discussion, it necessarily will be assumed that the third party might have sued but for the fact the agreement was under seal, and only cases in which the seal was a factor in the decision reached are considered. As indicated in the title hereto, cases involving actions at law only will be included. The annotation is confined

of one who is not a party to the instrument in fact or by construction of law, to sue upon it, excluding, therefore, questions as to the right of one who did not sign a sealed instrument, who by construction of law is deemed a party thereto, to sue on it.

The class of cases excluded is illustrated, perhaps, more clearly by the statement in Jones v. Buck (1914) 4 Boyce (Del.) 546, 90 Atl. 86, that some courts, while recognizing the rule that the inter partes character of the contract under seal determines who are

the parties with legal interest, and excludes from the enforcement thereof all others with mere beneficial interests, nevertheless look for a party with legal interest in some other part of the contract than in the premises, and finding that the contract has conferred upon a third person, who may happen to be the person beneficially interested, the legal right to enforce that interest by an action at law, and that this legal right is conferred by a clear expression, and not by implication, permit such other party to enforce the contract in his own name, upon the ground, however, that there is really another party to the contract who has an enforceable legal interest.

One phase of the general question of the right of a third party to enforce a contract made for his benefit is considered in the annotation in 2 A.L.R. 1193, supplemented in 33 A.L.R. 739 [Parties, § 10], entitled "Right of beneficiary to enforce contract between third persons to provide for him by will." Another phase is covered in the annotation in 21 A.L.R. 439, on "Liability of grantee assuming mortgage debt to mortgagee or one in privity with him."

Clearly one not a party to an instrument under seal, and not a beneficiary thereunder, can maintain no action on it. Leon v. Kerrison (1904) 47 Fla. 178, 36 So. 173; Gibson v. Johnson (1901) 23 Ky. L. Rep. 1322, 65 S. W. 116. This rule, however, is founded on the principle of contract law, that contracts do not as a rule confer rights on anyone but the parties thereto (see 6 R. C. L. 881), and the rule would be the same with respect to simple contracts.

II. View that third party cannot maintain action in own name.

a. In general.

At the present time, a majority of adjudicated cases passing upon the question under discussion hold that the rule which permits third persons to sue on contracts made for their benefit does not extend to give a third person the right to sue on a contract under seal; in other words, the fact that the instrument is under seal pre

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v. Morton

Hinkley v. Fowler (1839)

15 Me. 285; Farmington v. Hobert (1883) 74 Me. 416. See also Lyon v. Parker (1858) 45 Me. 474; Baldwin v. Emery (1897) 89 Me. 496, 36 Atl. 994; Harvey v. Maine Condensed Milk Co. (1898) 92 Me. 115, 42 Atl. 342.

Maryland. - Seigman v. Hoffacker (1881) 57 Md. 321.

Massachusetts.-Montague v. Smith (1816) 13 Mass. 396; Watson v. Cambridge (1818) 15 Mass. 286 (dictum); Johnson v. Foster (1846) 12 Met. 167; Huntington v. Knox (1851) 7 Cush. 371 (dictum); Millard v. Baldwin (1855) 3 Gray, 484; Northampton v. Elwell (1855) 4 Gray, 81; Robb v. Mudge (1860) 14 Gray, 534; Flynn v. North American L. Ins. Co. (1874) 115 Mass. 449; Flynn v. Massachusetts Ben. Asso. (1890) 152 Mass. 288, 25 N. E. 716; Saunders V. Saunders (1891) 154 Mass. 337, 28 N. E. 270; Clark v. Bullard (1911) 208 Mass. 586, 94 N. E. 1042 (dictum); Boyden v. Hill (1908) 198 Mass. 477, 85 N. E. 413; Forbes v. Thorpe (1911) 209 Mass. 570, 95 N. E. 955; CAVANAUGH BROS. HORSE Co. v. GASTON (reported herewith) ante, 1.

Missouri.-Robbins v. Ayres (1847) 10 Mo. 538, 47 Am. Dec. 125 (overruled by Rogers v. Gosnell (1873) 51 Mo. 466, on later appeal in (1875) 58 Mo. 589).

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tract in his own name if the promise is not under seal.

Virginia. Ross v. Milne (1841) 12 Leigh, 204, 37 Am. Dec. 646; Jones v. Thomas (1871) 21 Gratt. 96 (dictum). See also Mellvane v. Big Stony Lumber Co. (1906) 105 Va. 613, 54 S. E.


Johnson v. Mc


Florida. Hunter v. Wilson (1885) 21 Fla. 250.

Minnesota. Follansbee v. Johnson (1881) 28 Minn. 311, 9 N. W. 882.

New Jersey. Joslin v. New Jersey Car Spring Co. (1873) 36 N. J. L. 141. New York. - Nicoll v. Burke (1879) 78 N. Y. 580; Navarre Hotel & Importation Co. v. American Appraisal Co. (1913) 156 App. Div. 795, 142 N. Y. Supp. 89.

North Carolina.

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Cox v. Skeen (1842) 24 N. C. (2 Ired. L.) 220, 38 Am. Dec. 691.


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Brice v. King (1858)

Child v. Gillis Constr. Co. (1912) 42 Utah, 120, 129 Pac. 356. Vermont. Crampton v. Ballard (1838) 10 Vt. 251; Phelps v. Conant (1858) 30 Vt. 277; Cummings v. Blaisdell (1870) 43 Vt. 382. See also Warden v. Burnham (1836) & Vt. 390. England. Sims v. Bond (1833) 5 Barn. & Ad. 389, 110 Eng. Reprint, 834. See also New England Marine Ins. Co. v. De Wolf (1829) 8 Pick. (Mass.) 56.

The right of the party for whose benefit a contract was entered into to sue thereon was denied without discussion of the fact that the instrument was under seal in Waycross Air-Line R. Co. v. Southern Pine Co. (1902) 115 Ga. 7, 41 S. E. 271 (covenant in sale of timber; right to ship timber over plaintiff railroad), and in Styles v. F. R. Long Co. (1902) 67 N. J. L. 418, 51 Atl. 710.

West Virginia. Vùng (1885) 26 W. Va. 659. Wyoming. See McCarteney v. Wying Nat. Bank (1877) 1 Wyo. 382. England. Gilby v. Copley (1683) Lev. 138, 83 Eng. Reprint, 618; Southampton v. Brown (1827) 6 Barn. C. 718, 108 Eng. Reprint, 615; Barfard v. Stuckey (1820) 2 Brod. & B. 5,129 Eng. Reprint, 995; Berkeley Hardy (1826) 5 Barn. & C. 355, 108 Eng. Reprint, 132, 2 Eng. Rul. Cas. 24; Chesterfield & M. Silkstone Collery Co. v. Hawkins (1865) 3 Hurlst. &C. 677, 159 Eng. Reprint, 698.

And in the following cases the right of a third party to maintain an action on a contract apparently under seal was denied: Prentice v. Brimhall (1877) 123 Mass. 291 (covenant in deed to assume and pay a mortgage); Coffin v. Adams (1881) 131 Mass. 133 (stipulation in deed poll to assume and pay mortgage); Ricard v. Sanderson (1869) 41 N. Y. 179; Borland v. Welch (1900) 162 N. Y. 104, 56 N. E. 556 (right of third party to enforce mar

And in other cases, in fact dealing riage settlement denied on ground that

with simple contracts, it has been declared that one not a party to a contract made for his benefit may nevertheless maintain an action on the con

it was not made for benefit of plaintiff).

This rule, concerning which the earlier courts were practically unanimous,

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