Hazard v. Hazard

264 S.E.2d 908 (1980)

Margaret C. HAZARD
v.
Fred HAZARD.

No. 7915SC734.

Court of Appeals of North Carolina.

April 15, 1980.

Manning, Jackson, Osborn & Frankstone by David R. Frankstone and Frank B. Jackson, Hendersonville, for plaintiff-appellee.

John A. Northen, Chapel Hill, for defendant-appellant.

CLARK, Judge.

The defendant makes two arguments: First, that the contract was illegal and therefore unenforceable, and, second, that defendant is excused by impossibility of performance. We find neither argument convincing.

It does not appear that defendant's illegal contract argument is properly before this Court on appeal because illegality was not pled as an affirmative defense, G.S. 1A-1, Rule 8(c), and there was no exception to the conclusion of the trial court that "[a]s between the parties [the judgment] was a contract. . . ." Rule 10(a), N.C. Rules of Appellate Procedure. Nevertheless, it is clear that the consent judgment was not an illegal and unenforceable contract. The contract was not immoral, or criminal in itself, or contrary to public policy, but merely provided for the assignment or transfer of a right or benefit which federal law or regulation would not recognize. See, Marriott Financial Services, Inc. v. Capitol Funds, 288 N.C. 122, 217 S.E.2d 551, 77 A.L.R. 3d 1036 (1975); 17 C.J.S. Contracts § 190 (1963).

Next, the defendant relies on the doctrine of impossibility of performance. We find his reliance misplaced. The defendant made a promise to transfer and assign to the plaintiff certain rights and benefits; he made no effort to determine if federal law or regulation would not permit performance. Plaintiff has executed her promise and given up a valuable right to alimony, a right which has been extirpated by divorce. Now defendant argues that the impossibility existed at the time the contract was made and made the contract unenforceable. There is authority to support this general principle of contract law. See 17A C.J.S. Contracts § 462 (1963); 17 Am. Jur.2d Contracts § 404 (1964); Corbin on Contracts § 1326 (1962). We do not, however, find that this general principle applies to the case sub judice.

"A promisor should not be excused from responding in damages for breach of contract on the ground of impossibility of performance due to a mistake in a situation, where due to his own negligence, he had failed to discover at the time of entering into the contract the nonexistence of the fact or thing which made performance by him impossible." In re Zellmer, 1 Wis. 2d 46, 82 N.W.2d 891, 894 (1957).

In Lane v. Coe, 262 N.C. 8, 136 S.E.2d 269 (1964), defendant promised performance knowing that his ability to perform would depend on the cooperation of a third party. Subsequently, the third party refused to cooperate and defendant's performance became impossible. It was held that defendant could not avail himself of the defense of impossibility of performance. Similarly, in Helms v. Investment Co., 19 N.C.App. 5, 198 S.E.2d 79 (1973), the plaintiffs purchased a tract of land upon the warranty of defendant that water and sewer facilities would be made available within six months. The governing authorities of the City of Charlotte and Mecklenburg County prohibited the installation of the facilities because of pollution problems. The trial court granted summary judgment for plaintiffs on the issue of liability. This Court held that the defendant under the terms of its guaranty to the plaintiffs assumed the risk that the governing authorities might interpose objections, and defendant was liable to the plaintiffs for any damages sustained by their failure to perform the contract, citing 17 Am.Jur.2d Contracts §§ 418, 419, 423 and 17A C.J.S. Contracts § 463(1). See also, 17 Am.Jur.2d Contracts §§ 406, 407 (1963).

The promise made by plaintiff has been executed and her marital rights cannot be restored. The value of her rights has been established by the parties inter se as equal to the market value of the benefits defendant agreed to confer on her. Since defendant could not confer these benefits he must respond in damages, damages based on the fair market value of the benefits. The trial court so determined. The amount awarded was not contested or argued on appeal.

The judgment is

Affirmed.

ROBERT M. MARTIN and ERWIN, JJ., concur.