Schnell v. Nell – Case Brief

Schnell v. Nell, 17 Ind. 29 (1861).

Facts: Theresa Schnell died without property because all of the property she owned jointly with her husband Zacharias Schnell (D) reverted to him upon her death. Zacharias Schnell therefore agreed through contract to give each of three beneficiaries named in his deceased wife’s will $200. The contract indicated D’s purpose for the contract; that Theresa had been a dutiful and loving wife and had helped him acquire the property he owned. The contract stated that the consideration for the promise to the three beneficiaries was his wife’s love and affection and one cent. The contract also stated the condition that the beneficiaries must also abstain from collecting claims against him or his estate arising from Theresa’s will.

Nell (P), one of the beneficiaries, later sued D for nonpayment. The complaint did not aver that there had been any other consideration other than that stated in the alleged contract and did not aver that the one cent consideration had ever been paid.

D’s answer to the complaint stated that the alleged contract was given for no consideration. Nell demurred to Schnell’s answer on the grounds that it contradicted the alleged contract which had set out the consideration. The court sustained P’s demurrer.

Issue: Can a nominal sum of money or prior acts or love and affection act as legal consideration sufficient to create an enforceable contract?

Holding and Rule: No. The alleged contract set forth three distinct forms of consideration upon which the contract was to be formed: the promise to pay one cent, the love and affection of his deceased wife, and the desire to leave a bequest to the three beneficiaries. The court held that the consideration of one cent was not sufficient to render Schnell’s promise enforceable. While inadequacy of consideration will not vitiate an agreement, that doctrine does not apply to a mere unequal exchange of money. The exchange would have been valid if the cent had been at item of indeterminate value because it was unique or different or sentimental.

The also held that D had no legal obligation to honor his wife’s bequests and his promise to pay them was not legally binding. A moral consideration only will not support a contract. As for the promise by the beneficiaries not to pursue further claims arising from the will, the court held that valid consideration for his promise did not exist because any such claims would have been legally groundless. If a claim is legally groundless, a promise upon a compromise of it is not legally binding.

Disposition: Reversed with costs.

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