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same performance.” So if a contract with a third party for the same performance were made in ignorance of the prior contract and is not extorted by a threat of breach of contract, and the consideration is doing the thing rather than a promise to refrain from violating one's obligation, it would seem to serve no purpose of justice or utility to strike down such a contract for the reason that it does not satisfy the techincal test of legal detriment.
The conflict of authority on this secondary aspect of consideration shews that “legal detriment,” as a universal rule of thumb which may be applied blindly and mechanically to test the sufficiency or value of consideration, has broken down; and we are driven back to the test of public policy, which was suggested by Dean Ames,” to exclude contracts founded on wrong or bad faith practised by one contracting party on the other. When the law of consideration is broadened so as to recognize not only bargain, but also all other just grounds for the enforcement of a promise, and gives up the foolish attempt to measure the sufficiency of what is promised in exchange by a mechanical formula, then there will be no occasion for its abolition by the Courts or by the Legislature.
HENRY WINTHROP BALLANTINE. University of Montana.
* See Reale, 17 Harv. I. Rev. 71.
IMPORTANT POINTS OF LAW.
INDEMNITY OF A JoJNT TORT-FEASOR.—More than a century ago it was decided in Viron v. Merryweather that an implied indemnity does not arise as between joint tortfeasors simply by reason of the payment by one of the whole liability; and though the rule has more than once been adversely criticized, it is now too late, said Lord Herschell, to question the decision in this country. Yet if a person can lawfully employ another to fulfil a duty which the law casts on him, there seems to be no ground of public policy which prevents him from stipulating for an indemnity by the latter against claims arising from the non-fulfilment of the duty. Neither Merryweather v. Niron nor any of the later authorities declares such an agreement to be unlawful, and there are dicta which support its validity. Newcombe v. Yelten and the Croydon Rural District Council (which came before Mr. Justice Darling last week) was an action under Lord Campbell's Act against the Board and a contractor, whom they had employed to do some work involving the excavation of a deep pit adjoining a highway, under an indemnity from him against liability to third parties for his negligence. A verdict having been obtained by the widow and daughter of a person who had met his death by falling into the pit, which they said was insufficiently fenced and not properly lit, the learned Judge held that the Board were entitled to be indemnified by the contractor. His decision will help to cure an erroneous belief in the universality of the rule that a joint tort-feasor has no right to contribution or indemnity.
DIRECTORs' CoNTRACTs witH CoMPANIES.—There is a wholesome rule that in general a director of a company shall vacate his office if he is concerned in the profits of any contract with the company. The general principle is that a company is entitled to the aggregate wisdom and experience of its directors, and if all or any of the directors are interested in a contract, the company loses the benefit of their unbiased judgment. This principle is recognised in Table A., clause 77, under the Companies (Consolidation) Act, 1908, which provides that the office of director shall be vacated if the director is concerned or participates in the profits of any contract with the company. There is an exception where the director is a member of another company which enters into contracts with the company of which he is a director, but he must not vote in respect of any such contract or work. The rule was exemplified and applied in the Star Steam Laundry Co., Ltd. v. Dukas, decided recently by Lord Justice Farwell sitting as an additional Judge of the Chancery Division. In that case there was a clause in the articles, of course superseding Table A, which provided for the vacating of the office
of any director who should be concerned in or participate in the profits of any contract with the company. I was unsuccessfully contended that, as no profits had arisen from the contract, the office was not vacated, since the clause should be read as meaning “concerned in or participating in profits” and not as “concerned in any contract or participate in any profits.” The learned Lord Justice was, however, driven to the conclusion that if the director was concerned in any contract he was bound to vacate, and that it was beside the mark to say that profits had not resulted. The general rule is clear, but it is to be remembered that it is possible in these cases, as it were, to contract out. One often sees in elaborately drawn articles provisions giving to a director full power in respect of contracts in which he may possibly have an interest, and, however undesirable this may be in principle, there is nothing against it in the statute, as there is, for instance, in the Municipal Corporations Act, 1882, which creates for the members of a corporation an abolute disqualification.
ANNUITY A CHARGE UPON CoRPUs.--The question whether an annuity is a charge upon corpus has again arisen in the recent case of Re Young; Brown v. Hodgson (107 L. T. Rep. 380; (1912), 2 Ch. 479). The only distinction between that case and Re Hou’arth: Howarth v. Makinson (160 L. T. Rep. 865; (1909), 2 Ch. 19), noticed in this journal of the 21st Jan. 1911, p. 286, is that in Re Young there was a trust for the accumulation during the infancy of a child of the residue of the income after paying the annuities. In both cases there was a direction to pay the annuities out of income with an ultimate gift “subject to the said annuities,” and the learned Judge decided (following Re Houarth) that, notwithstanding the direction to accumulate the residue of the income, the annuities were a charge upon the corpus. The case is useful as shewing that Taylor v. Taylor (L. Rep. 17 Eq. 324) must be taken to have been overruled by Re Howarth. In Taylor v. Taylor the testator gave the residue of his real and personal estate to trustees for a term of eleven years from his decease, upon trust to pay out of the rents, interest, dividends, and proceeds certain life annuities, and he directed that the residue of the rents, &c., should during the term be accumulated for the benefit of the person who should become entitled to the residue of the personalty at the expiration of the term, and after the determination of the term he devised his real estate, “subject nevertheless to and charged with the payment of ’’ the annuities, for the residue of the lives of the annuitants, with powers of entry and distress for recovery of the same, in strict settlement. Vice-Chancellor Hall held that the annuities were not charged upon the corpus, but were a continuing charge on the income; he refused, however, to order a sale, apparently because the land was devised in strict settlement. That case was commented on adversely in Hambro v. Hambro (1894), 2 Ch. 564, in which Mr. Justice North held that there is jurisdiction to order a sale or mortgage of land to raise arrears of a jointure rent charge issuing out of the rents and profits of the said land, though there is no express charge on the land. In the course of the argument in Re Young, Mr. Justice Parker asked: “What is the difference between a continuing charge on income and a charge on capital?” and counsel for the annuitant replied: “The difforence in only acedemic.” And in the course of his judgment Mr. Justice Parker said that it might in some cases be necessary to distinguish between a perpetual charge on income and a charge on capital, but he should have thought that after the case of Hambro v. Hambro, for the purposes of raising arrears of an annuity which was a continuing charge on income, the matter was in the same position as if there were a charge on corpus.
AER CLAUSUs.—Three centuries ago English jurists were the champions of the freedom of the seas against foreign advocates of the rights of States to assume sovereign dominion over them. To-day the roles are reversed, and while foreign jurists proclaim the freedom of the air for the aeronauts of all countries, English legislators, with the support of English jurists, are establishing a control over the air above and surrounding our territory which is far more stringent than the control exercised by any State over passage on land or sea. It is open to question whether the Regulations hurriedly issued by the Home Secretary under the Aerial Navigation Amendment Act passed but a few weeks ago do not leave something to be desired by the international jurist, who, while upholding the State's sovereignty over the air above its territory, nevertheless desires, so far as is consistent with public security, to leave the air free as a highway for innocent passage. Under the Regulations a foreign aeronaut is debarred from landing on English shores save within certain prescribed areas; he must send a notice to the Home Office of his proposed landing place within those areas, together with the approximate time of his arrival; he must obtain a clearance from a British consular agent in the country where he starts his journey; on his arrival within the English jurisdiction, he must get a fresh permit from the local authority to continue his journey, and must carry at least one British representative on his air-craft; nor may he carry any photographic apparatus within the realm. The effect of these Regulations, which are sanctioned by a penalty of imprisonment for six months and a heavy fine in money, is virtually to close the air-space above the British Isles to foreign air-craft. Doubtless, in the past the absence of Regulations has been a source of anxiety, and the interests of national defence are of paramount importance. But it may be expected that larger experience may enable the authorities in the future to restrict less narrowly the freedom of the navigation of the air. And for the moment, perhaps, this emphatic assertion of national sovereignty will, so to speak, clear the atmosphere of the dread of nocturnal expeditions and flying spies.
THE DEVELOPMENT OF INTERNATIONAL CourTs.-A conference is now sitting at Madrid for the purpose of formulating a plan for the establishment of “Mixed Courts * at Tangier which shall have jurisdiction in cases between foreign subjects of different nationalities and foreign subjects and natives. The regime of the Capitulations under which the subjects of Christian countries, living in Oriental