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United States Court of Appeals for the Ninth Circuit - 117 F. 99
Tags: Contracts, Modification, Pre-e
tl;dr:
Some dudes agreed to work on a ship in Alaska, but once they arrived, they demanded more for their services from the shipowners. The shipowners had no choice but to agree, but once they got back from Alaska, they refused to pay.Video Summary
Case Summary
In Alaska Packers' Ass'n v. Domenico, a group of sailors (plaintiffs) sued the Alaska Packers’ Association (defendant) for breach of contract following the sailors’ return from a trip to Alaska.
The sailors agreed to go from San Francisco to Pyramid Harbor, Alaska, to catch fish in the employ of the Alaska Packers’ Association during the fishing season of 1900. Alaska Packers’ agreed to pay each sailor $50-60 and two cents per red salmon caught. While in Alaska, the sailors ceased work and demanded $100 to continue working instead of the $50-60 promised. The company’s superintendent yielded to their demands but told the sailors he did not have the authority to reformulate the contract. When the sailors returned, Alaska Packers’ paid the sailors at the $50-60 rate instead of $100.
The trial court initially supported the plaintiff, but the decision was reversed on appeal. The court determined there wasn't a valid contract between the parties due to a lack of consideration, which is either a benefit given to the person making the promise or a loss suffered by the person receiving the promise. The plaintiff's agreement to keep working didn't count as consideration because they were already obligated to work under a previous contract.
The court said that a contract modification needs a new and independent consideration. Additionally, it determined there was no duress or coercion, as the plaintiff had the option to accept or decline the offer. This case is important because it sets a precedent for dismissing claims based on promises made without consideration. Courts use this case to demonstrate the concept of consideration as a crucial part of a valid contract, as well as distinctions between contracts and simple promises.
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The case involves a dispute between the libelants and the appellant corporation over a contract made in Pyramid Harbor, Alaska. The libelants claim that the appellant agreed to pay them $100 for services rendered and to be rendered, but the appellant denies executing the contract and alleges that the work performed by the libelants was under different contracts. The libelants had previously entered into a written contract with the appellant in San Francisco, agreeing to work as sailors and fishermen during the fishing season of 1900. The appellant agreed to pay each libelant $50 for the season and two cents for each red salmon caught. The libelants stopped work on May 19th and demanded $100 for services in operating the vessel to and from Pyramid Harbor. The company's superintendent prepared a new contract, which was signed by the libelants before a shipping commissioner, but the company denied the validity of the new contract upon the libelants' return to San Francisco. The libelants refused to continue their services unless the appellant agreed to pay them more money, which was without consideration as it was based solely on their existing obligation. The court found conflicting evidence and ruled against the libelants. The main issue was whether the alleged contract made by the appellant's superintendent was supported by sufficient consideration. The appellant's superintendent at Pyramid Harbor had no authority to waive any rights under the original contract.
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