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Hamer v. Sidway - 124 N.Y. 538, 27 N.E. 256 (1891)

Rule:

A valuable consideration in the sense of the law consists either of some right, interest, profit or benefit accruing to the one party, or some forbearance, detriment, loss or responsibility given, suffered or undertaken by the other. Courts will not ask whether the thing which forms the consideration does in fact benefit the promisee or a third party, or is of any substantial value to anyone. It is enough that something is promised, done, forborne or suffered by the party to whom the promise is made as consideration for the promise made to him. 

Facts:

The testator ("the promisor") made an agreement with his nephew ("the promisee") that if he refrained from drinking liquor, using tobacco, swearing and playing cards or billiards for money until he reached the age of 21, the testator-promisor would pay him $ 5,000. The nephew-promisee fulfilled his obligation. He then notified the testator-promisor of his performance of his part of the agreement. After the testator-promisor admitted the agreement and the performance, the two agreed that the money, including interest, would be held by the testator-promisor until the nephew-promisee was capable of taking care of it. However, the testator-promisor died before paying the nephew-promisee any portion of the agreed-upon sum. The plaintiff, who was the nephew's assignor, filed this action against defendant, who was the executor of the estate, seeking to enforce the now-deceased uncle's promise to pay the sum of money. The Special Term trial court ruled in favor of the plaintiff. The General Term of the Supreme Court reversed on appeal, ruling in favor of the defendant estate. Appellant-estate sought review, contending that the contract was without consideration to support it, and, therefore, invalid. 

(Procedural note: in the New York state court system, the Supreme Court is not the highest court. The Court of Appeals is the highest court.)

Issue:

Was a promise to abandon a legal right to use tobacco and alcohol considered sufficient consideration to enforce a contract between the promisor and the promisee? 

Answer:

Yes

Conclusion:

The Court of Appeals of New York reversed the appellate court's order and affirmed the trial court's judgment. Ruling in favor of the plaintiff, the Court held that the right to use and enjoy the use of tobacco was a right that belonged to the nephew-promisee and was not forbidden by law. The abandonment of its use was a sufficient consideration to uphold the promise because such abandonment was the inducement for the promise. It is not essential in order to make out a good consideration for a promise to show that the promisor was benefited or the promisee injured. A promise to forbear or abandon a legal right in return for another's promise is sufficient consideration to support a contract or sustain a promise. Because the nephew-promisee abandoned his legal right to use tobacco and drink liquor in exchange for the testator-promisor’s promise to pay him a sum of money, there was sufficient consideration to enforce the contract. In general, a waiver of any legal right at the request of another party is a sufficient consideration for a promise. 

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