Jefferson v. Asch

• Decision Date: 08 June 1893
• Parties: JEFFERSON ET AL. v ASCH ET AL.
• Court: Minnesota Supreme Court

53 Minn. 446

55 N.W. 604

JEFFERSON ET AL.vASCH ET AL.

Supreme Court of Minnesota.

June 8, 1893.

(Syllabus by the Court.)

A stranger to a contract between others, in which one of the parties promises to do something for the benefit of such stranger, there being nothing but the promise, no consideration from such stranger, and no duty or obligation to him on the part of the promisee, cannot recover upon it.

Appeal from district court, Ramsey county; Kelly, Judge.

Action on a bond by Rufus C. Jefferson and others, partners as Jefferson & Kasson, against Carl Asch and others. Defendants had judgment on demurrer to the complaint, and plaintiffs appeal. Affirmed.

Owen Morris, for appellants.

F. W. Zollman, for respondents.

GILFILLAN, C. J.

The Boston Northwest Real-Estate Company owned a lot on Sixth street, St. Paul, with two buildings standing on it, and let it to George Benz for the term of five years from May 1, 1889, and about a year thereafter he sublet it for the remainder of his term to Smith & Co. Afterwards Smith & Co. entered into a contract with the defendant Leithauser to make certain alterations and repairs and the defendants Leithauser as principal, and Asch and Boldthen as sureties, executed a bond, in which they acknowledged themselves to be indebted to George Benz, “for the use of the Boston Northwest Real-Estate Company,” “and all persons who may do work or furnish material” pursuant to said contract, to be paid to the said George Benz, his executors, administrators, or assigns, for the said use,” and which was conditioned to be void if Leithauser should pay “all just claims for all work done and to be done and all materials furnished and to be furnished pursuant to said contract and in the execution of the work therein provided for, as they shall become due, and shall indemnify and save harmless said George Benz and said Boston Northwest Real-Estate Company from all mechanics' liens,” etc., and “indemnify and save harmless the said George Benz from all claims of whatever description which may arise from, in, or about said work, alterations, and repairs.” The plaintiffs, having furnished materials to the contractor for the purposes of the contract, bring this action on the bond to recover the price thereof. The court below sustained a demurrer to the complaint.

From the seals to this bond there arises the presumption of a sufficient consideration to sustain it between the parties to it. The cases in which one not a party to a contract may sue upon a promise in it for his benefit were at one time limited to contracts not under seal, and this court, in stating the law on the subject, in Follansbee v. Johnson, 28 Minn. 311,9 N. W. Rep. 882, expressed that limitation; but the distinction in this respect between contracts by specialty and simple contacts has not in the later authorities been adhered to, and may now be regarded as abandoned. If there ever was any reason for the distinction, it could only have been a technical one, which no longer has any merit to commend it, and we do not think we ought to recognize it. Though this seems intended as a mere bond to indemnify and save the obligee named harmless, that, and not any incidental benefit that might accrue to others not parties to it, being the primary purpose of its stipulations and promises, we will treat it, because on both sides it is so presented here, as though such primary purpose were to secure payment to the persons doing work or furnishing material under the contract mentioned in it. In considering the question presented we must lay aside, as having no bearing upon it, the cases of official or statutory bonds required or authorized for the benefit or security of persons not named as obligee, a nominal obligee being named, and where the statute expressly or by implication authorizes such persons to sue upon them. Instances of such are sheriffs' bonds, probate bonds, bonds authorized by the mechanic's lien law in Gen. St. 1878, and such as were considered in City of St. Paul v. Butler, 30 Minn. 459,16 N. W. Rep. 362, and Morton v. Power, 33 Minn. 521,24 N. W. Rep. 194. As, so far as appears by the complaint, Benz could not be liable to pay for the work done and materials furnished in fulfilling the contract to repair, and as, under the law then in force, his interest in the property could not be subject to a lien therefor, it was legally a matter of indifference to him whether the work and materials were paid for or not. He had no duty in respect to it. And the question comes to this: Where, in a contract between two persons one promises the other to do something for the benefit of a stranger to the contract, and the promisee has no relation to the thing to be done nor to the stranger to be benefited, can such stranger bring an action to enforce the promise. In some of the text-books and decisions it is stated generally “that, where one person makes a promise to another for the benefit of a third person, that third person may maintain an action upon it.” But we do not think there is a case to be found in which such an action was sustained upon a bare promise, with no other circumstances to justify an exception to the general rule that an action upon contract can be maintained only where there is privity of contract between the parties. In Lawrence v....