Perry M. Alexander Const. Co. v. Burbank

350 S.E.2d 877 (1986)

83 N.C. App. 503

PERRY M. ALEXANDER CONSTRUCTION COMPANY v. William F. BURBANK.

No. 8628SC830.

Court of Appeals of North Carolina.

December 16, 1986.

*879 Tharrington, Smith & Hargrove by J. David Farren and Elizabeth Kuniholm, Raleigh, for defendant appellant.

Riddle, Kelly and Cagle by E. Glenn Kelly, Asheville, for plaintiff appellee.

ARNOLD, Judge.

The test on a motion for summary judgment is whether on the basis of the materials presented to the court there is any genuine issue as to any material fact and whether the movant is entitled to judgment as a matter of law. Barbour v. Little, 37 N.C.App. 686, 247 S.E.2d 252, disc. rev. denied, 295 N.C. 733, 248 S.E.2d 862 (1978).

We find that the trial court properly denied defendant's motion for summary judgment because an issue of material fact existed with respect to defendant's contractual liability.

Defendant contends that there is insufficient evidence to support the court's finding that a subsequent agreement was entered into between plaintiff and defendant.

The trial court determined that plaintiff and defendant Burbank entered into an oral contract under which Burbank became obligated to pay plaintiff for the demolition. The well-established rule is that findings of fact made by the trial court in a non-jury trial have the force and effect of a jury verdict and are conclusive on appeal if there is evidence to support them. Henderson County v. Osteen, 297 N.C. 113, 254 S.E.2d 160 (1979). A careful review of the record reveals that there is competent evidence to support the trial court's findings of fact.

Defendant also contends that the oral contract is not supported by consideration. We disagree.

The trial court found that plaintiff and Sure-Fire entered into a written contract under which plaintiff agreed to perform the demolition. The trial court further found that plaintiff and defendant Burbank entered into an oral contract under which plaintiff agreed to perform the same demolition. Defendant argues that because plaintiff was already obligated to perform the demolition under its contract with Sure-Fire, its promise to perform the same demolition in the contract with defendant Burbank is not consideration for Burbank's promise to pay. In other words, the question is whether plaintiff's promise to perform the demolition can suffice as consideration for both Sure-Fire's promise to pay and Burbank's promise to pay in the two separate contracts.

It is generally established that a promise to perform an act which the promisor is already bound to perform is insufficient consideration for a promise by the adverse party, Sinclair v. Travis, 231 N.C. 345, 57 S.E.2d 394 (1950); Tile and Marble Co. v. Construction Co., 16 N.C. App. 740, 193 S.E.2d 338 (1972), and undoubtedly this is sound policy. But the same factors do not come into play where a third person is involved.

Burton v. Kenyon, 46 N.C.App. 309, 311, 264 S.E.2d 808, 809 (1980).

In the case sub judice, a third person is involved since defendant Burbank and Sure-Fire are separate parties.

Restatement of Contracts § 84 (1932) provides in pertinent part: `Consideration is not insufficient because of the fact * * * * * * (d) that the party giving the consideration is then bound by a contractual or quasi-contractual duty to a third person to perform the act or forbearance given or promised as consideration ...' The rationale of the Restatement rule is best set forth in 1A. Corbin on Contracts § 176 (1950) wherein it is stated: `But suppose that the pre-existing duty is owed to a third person and not to the promisor. Is the performance of this kind of duty a sufficient consideration for a promise? The American Law Institute has stated that it is sufficient. This should be supported for two reasons: (1) the promisor gets the exact consideration for which he bargains, one to which he previously had no right and one that he might never have received; (2) there are no sound *880 reasons of social policy for not applying in this case the ordinary rules as to sufficiency of consideration. The performance is bargained for, it is beneficial to the promisor, the promisee has forborne to seek a rescission or discharge from the third person to whom the duty was owed, and there is almost never any probability that the promisee has been in position to use or has in fact used any economic coercion to induce the making of the promise. There is now a strong tendency for the courts to support these statements and to enforce the promise. The reasons that may be advanced to support the rule that is applied in the two-party cases, weak enough as they often are in those cases, are scarcely applicable at all in three-party cases.' (Footnote omitted.)

Id. at 311-12, 264 S.E.2d at 809-10.

In light of the above, we hold that plaintiff's promise to perform the demolition suffices as consideration for Burbank's promise to pay even though the promise to perform the demolition was also the consideration in the contract between plaintiff and Sure-Fire.

The judgment of the trial court is

Affirmed.

JOHNSON and EAGLES, JJ., concur.