Wood V. Lucy, Lady Duff-Gordon – (Promises Grounded in the Past)

Wood v. Lucy, Lady Duff-Gordon, 118 N.E. 214, 222 N.Y. 88, (1917)

BY: James F. Polk – AISOL YEAR ONE STUDENT

FACTS:  Appellant & Original Defendant Lucy, Lady Duff-Gordon gave Appellee & Original Plaintiff Wood the exclusive right to place her endorsement on products and to market her designs & to license others to market them subject to her approval for at least one year.  He was to share 50% of the profit.  He was to report monthly all expenditures and incomes.  He was to obtain all patents required.  She then went and began marketing her own products.  He argued that she did not have the right.  She argued that he did not bind himself and therefore there was no contract.

APPEAL:  He did in fact limit himself because it is implied that he has a duty to work to obtain contracts and sales etc. based on the fact that his business was one that did exactly that and he was to provide a monthly accounting and to obtain patents.

Issue:  Was the contract between the parties actually a contract with a bargained for exchange inclusive of mutuality?  The question is asked because the writing does not expressly require the Plaintiff to place endorsements.

Analysis:  The circumstances imply a binding mutuality and/or return promise because of the circumstances of the parties to the contract and the basic nature of the contract.

DIRECT QUOTE:  We think, however, that such a promise is fairly to be implied. The law has outgrown its primitive stage of formalism when the precise word was the sovereign talisman, and every slip was fatal. It takes a broader view to-day. A promise may be lacking, and yet the whole writing may be “instinct with an obligation,” imperfectly expressed (SCOTT, J., in McCall Co. v. Wright,133 A.D. 62; Moran v. Standard Oil Co., 211 N.Y. 187,198). If that is so, there is a contract.

CONCLUSION: The judgment of the Appellate Division should be reversed, and the order of the Special Term affirmed, with costs in the Appellate Division and in this court.

CUDDEBACK, McLAUGHLIN and ANDREWS, JJ., concur; HISCOCK, Ch. J., CHASE and CRANE, JJ., dissent.