Scott v. Moragues Lumber Co. - 202 Ala. 312, 80 So. 394 (1918)

Rule:

A valid contract may be conditioned upon the happening of an event, even though the event may depend upon the will of the party who afterwards seeks to avoid its obligation.

Facts:

Defendant individual offered to charter a vessel to the plaintiff corporation for the transportation of lumber from any port in the Gulf of Mexico to Montevideo or Buenos Aires for a set freight. The offer was subject to the defendant buying a certain vessel. The vessel was to be furnished by the defendant to the plaintiff within a reasonable time after it was purchased. The defendant purchased the vessel but chartered it to a third party instead of the plaintiff. Subsequently, plaintiff corporation filed an action against defendant for breach of a charter party agreement. The Mobile County Circuit Court (Alabama) entered a judgment for the plaintiff and the defendant appealed. 

Issue:

Under the circumstances, could the defendant be held liable for breach of the parties’ charter party agreement? 

Answer:

Yes

Conclusion:

The judgment for the plaintiff corporation in its breach of charter party agreement action was affirmed on appeal. According to the court, the contract was not void for want of consideration or mutuality of obligation even though it was conditioned on the defendant’s decision to purchase the vessel. The plaintiff corporation's complaint adequately alleged that the corporation had accepted the defendant’s offer before he purchased the vessel, that the defendant purchased the vessel, and that the corporation was ready and willing to perform the contract at all times. The corporation did not have to allege in the complaint that it designated a port to which the vessel had to be delivered because such a designation was not a condition precedent to the defendant’s liability.