August v. Collins , 240 Mich. 23 ( 1927 )

It is insisted on behalf of defendants that there was a valid contract extending the time of payment as fixed in the contract, and that, if the claimed contract of extension is not valid and enforceable, there has been such waiver of its terms as to estop plaintiffs from its enforcement.

1. It will be noted that it was agreed in the contract, which defendants assumed and agreed to be bound by, that the title was satisfactory. If plaintiffs promised to extend the time and to furnish evidence to show that their title was satisfactory, it was but a naked promise without consideration and not enforceable. The general rule is thus stated in 6 R. C. L. pp. 916, 917, § 301:

"It has been said that a provision of a contract may be waived without a new consideration. But while there are some expressions in the cases which seem to dispense with the necessity of a consideration for a modification of a contract, yet a modification can be nothing but a new contract, and must be supported by a consideration like every other contract. * * * An oral agreement to enlarge the time or change the place of performance fixed by a written contract must be subsequent to the time of the execution of the latter, and constitute an independent agreement of itself, acquiring its binding effect either from an existing consideration at the time, or from having been acted upon by the parties until it could not be disregarded by one party without working an injury to the other party."

In the case of Bartlett v. Smith, 146 Mich. 188 (117 Am. St. Rep. 625), which involved the extension of time for the performance of a land contract, it was said by Mr. Justice GRANT, speaking for the court:

"The promise to extend the time of payment, if made, was a mere naked promise, resting in parol, without any consideration, and was therefore of no validity."

2. While this court is committed to the rule stated by Justice GRANT, it is likewise committed to the doctrine that, where the time of performance has been waived under such circumstances that it would be inequitable to literally enforce the contract, this court will apply the doctrine of estoppel to the transaction. Defendants' counsel insist that we should hold that the facts of the instant case bring it within this rule, and they rely on Waller v. Lieberman, 214 Mich. 428; Fry v.Miller, 220 Mich. 463; Letinsky v. Smith, 220 Mich. 467;Zadigian v. Gard, 223 Mich. 147; Bugajski v. Siwka, 200 Mich. 415 . Most of the cases where we have applied the doctrine have been equity cases in which the vendee has been seeking the right to make delayed payments, the right to pay up, to redeem, and where the vendor by theretofore accepting payments after they were due has lulled him into insecurity, and we have held, under such circumstances, that before the forfeiture could be effectively declared notice must be given to the vendee of the intention so to do and a reasonable time given in which to make the payments. We have likewise applied the doctrine in ejectment cases. Treat v. Railway, 157 Mich. 320 (133 Am. St. Rep. 347); Sliwinski v. Gootstein, 234 Mich. 74. InDrake v. Lippman, 234 Mich. 80, it was not necessary to decide, and we did not decide, that it should be applied to summary proceedings, as we there held there were no grounds of estoppel present. And that is quite the situation in the instant case. The ink was scarcely dry on the signatures to the agreement by which defendant company assumed the contract and agreed to be bound by its terms before it insisted it would not pay according to its terms or pay at all unless plaintiffs agreed to its modification, and it claims to have exacted a promise which subsequent events developed was impossible of performance. It claims that all payments which in fact were made reached the plaintiffs because the party to whom it intrusted the checks violated his instructions. It was in no way lulled into insecurity. There are no elements of estoppel present. Indeed, the question of estoppel was not brought into the case until it was apparent the court was about to direct a verdict for plaintiffs, when defendants' counsel moved for a directed verdict on this ground. Plaintiffs' counsel insists defendant company was seeking delay rather than an opportunity to pay with safety, and the record tends to support such claim. Such claim also finds support in the fact that the case was not submitted to this court until over three years after the trial in the circuit. The trial judge was right in denying defendants' motion for a directed verdict and in granting that of the plaintiffs.

The judgment will be affirmed.

SHARPE, C.J., and BIRD, SNOW, STEERE, WIEST, CLARK, and Mc DONALD, JJ., concurred.