Citation: 27 N.E. 256 (N.Y. 1891).

One-Sentence Synopsis: Forbearance of a legal right by a party to the contract will be sufficient consideration to sustain a contract even if the performance of that promise benefits the promisor.

Summary: Uncle promised his nephew that he will give the nephew $5,000 on his 21st birthday if the nephew refrained from alcohol, tobacco and gambling. The nephew successfully did so and informed his uncle of this achievement on his 21st birthday. In response, the uncle wrote a letter to the nephew stating that the he was going to hold the $5,000 for the nephew until the nephew was old enough to manage the money and that the money was going to earn interest.

The uncle held the money for 12 more years but died before payment. The nephew had assigned his interest in the money to his wife, Plaintiff Louisa Hamer, who sued the executor of the Uncle’s estate for the money.

The trial court ruled in favor of Plaintiff. The intermediate court of appeal reverse. The highest court of the state, however, affirmed the judgment in favor of Plaintiff.

The issue before the court was whether the contract between the uncle and nephew was supported by consideration. The court answered that question in the affirmative.

The court observed the general rule that, “a waiver of any legal right at the request of another party is sufficient consideration for a promise.” Consideration does not require that the promise actually benefit the promisee.

Applying the foregoing rules to the facts of the case, the court reasoned: “It is sufficient that [the nephew] 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.”

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