Hamer v. Sidway

Facts

William E. Story promised his nephew, William E. Story, 2d, that if the nephew would refrain from drinking liquor, using tobacco, swearing, and playing cards or billiards for money until he turned 21, the uncle would pay him $5,000. The nephew agreed and fully performed. On his twenty-first birthday he wrote to his uncle that, according to agreement, he believed the $5,000 was due him. The uncle replied a few days later, acknowledging the debt, saying he had the money in the bank intended for the nephew, and promising not to interfere with it until he thought the nephew capable of taking care of it, adding that the nephew could consider the money on interest. The nephew consented to the money remaining with his uncle on those terms. On the first day of March, 1877, with the uncle's knowledge and consent, the nephew assigned his right to the $5,000 to his wife, Libbie H. Story, who assigned it to the plaintiff, Louisa W. Hamer. After the uncle's death, his executor, Sidway, defended the suit on the grounds that the contract lacked consideration and that the claim was barred by the Statute of Limitations.

Issues

1. Did the nephew's refraining for years from liquor and tobacco, which he had a legal right to use, supply consideration for the uncle's promise to pay $5,000?
2. Did the uncle's letter, and the nephew's assent to it, turn the uncle from a mere debtor into a trustee holding the money for the nephew?

Holding

The nephew had a legal right to use liquor and tobacco, and he abandoned that right for years on the strength of his uncle's promise, so the promise was supported by consideration. The uncle's letter declared that he had set the money apart for the nephew, and the nephew assented, so the uncle became a trustee and the action was not barred by lapse of time.