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Davis & Co. v. Morgan - 117 Ga. 504, 43 S.E. 732 (1903)

Rule:

Ga. Code Ann. § 3658 defines a good consideration to be such as is founded on natural duty and affection, or "on a strong moral obligation." The section, however, does not relate to the moral obligation which inheres in every promise.

Facts:

Defendant Davis & Company ("Davis") employed plaintiff Morgan for one year at $ 40 per month. After the contract had been in force for some time, Morgan received an offer of $ 65 per month from a company in Florida. Morgan mentioned the offer to Davis, saying that he would not go without Davis' consent. Davis insisted that he then said, if Morgan would stay out the balance of the term and work satisfactorily he would give him $ 120 at the end of the year. Morgan, however, averred that Davis stated, "I will add $ 10 a month from the time you began, and owe you $ 120 when your time is up." Davis discharged Morgan two or three weeks before the end of the term because Morgan had in fact had gone to Florida for several days without their consent. Morgan insisted that he told Davis that he was going, and that Davis made no objection. He claimed that he was discharged without proper cause, and filed a lawsuit in Georgia state court to recover the extra compensation promised by Davis. After a trial, the jury found a verdict in Morgan's favor. The trial court denied Davis' motion for a new trial, and Davis appealed. 

Issue:

Was the Davis' promise to Morgan to pay additional compensation enforceable?

Answer:

No.

Conclusion:

The state supreme court reversed the trial court's judgment. The court ruled that if the promise contemplated that Davis were to pay Morgan $ 10 per month for that part of the year which had already passed, and as to which there had been a settlement, it was manifestly nudum pactum; for a past transaction, the obligation of which had been fully satisfied, would not sustain a new promise. And the result was practically the same whether Morgan or Davis was correct in their versions of the conversation: Both proved a promise to give more than was due, and to pay extra for what one was already legally bound to perform. Davis therefore received no consideration for his promise to give the additional money at the end of the year. Morgan had agreed to work for twelve months at the price promised; and if during the term he had agreed to receive less, Davis would still have been liable to pay him the full $ 40 per month. On the other hand, Davis could not be forced to pay more than the contract price. He got no more services than he had already contracted to receive, and, according to an almost unbroken line of decisions, the agreement to give more than was due was a nudum pactum and void as having no consideration to support the promise. 

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