The Effects of a Contract under a Mode

I. Notion. A contract under a mode is had when to a contract substantially complete there is added by one contracting party a burden to be fulfilled by the other from justice; as if someone gives another some sum of money for buying books, or sells someone a house on this condition, that he himself should dwell in it.

A contract under a mode is not had when a burden is not imposed, or is not imposed from justice, but is added only for the sake of stimulating; as if a father on the occasion of a feast gives something to his son, adding that he gives it for this end, that in the future he may study well.

A contract under a mode differs from a contract under a condition; for the latter depends, as to value, upon the condition, whereas a contract under a mode involves a new obligation being added to a valid contract.

Note 1. A mode contrary to the substance of the contract makes the contract void if consent is in reality attached to it, since it excludes consent with respect to the object of the contract.

Note 2. An impossible or base mode can be held as not added, unless it is established that consent was attached to it. For an impossible mode is presumed not to have been added seriously, but a base mode is imposed not by way of obligation but of allurement or seduction.

II. Effects. 1. One who accepts a contract under a possible and honest mode is bound from justice to fulfill the mode, as follows from what has been said. If it is culpably not fulfilled, restitution per se must be made to the amount of the interest in the mode being observed.

2. A mode not fulfilled does not render the contract rescindable. For the faculty or obligation of rescinding the contract would have to arise from the injury which neglect of the mode would involve. But from that injury there arises only the obligation of restoring to the amount of the interest in the mode being observed. But if the said injury could not be sufficiently repaired except by rescinding the contract and restoring things to their former state, per accidens, so to speak, the contract would become rescindable.

Often, however, there will not be a contract under a mode strictly so called, but from the mind of the contracting parties a mode, improperly so called, is added by way of a condition; if this is not fulfilled, the contract collapses or is rendered rescindable.¹

What the party whose interest is involved can do, with civil law considered, if the mode is not fulfilled, see in the Code of one's country.

¹ From cap. Verum, L. 4, tit. 5, De cond. appos., a donation for a pious cause does not collapse because of a mode not observed, unless the donor established this; but then a resolutory condition rather than a mode is had.

794. • A mode is an added quality, for the most part not suspending the contract, but adding something for the burden or favor of one of the contracting parties.

Modal contracts are made chiefly: 1. to a day; 2. under a cause; 3. under a penalty; 4. under a demonstration; 5. under a disjunction.

You will resolve. - 1. The mode must be observed from justice, unless it is repugnant to the substance of the contract.

2. Its violation ordinarily, and unless otherwise agreed, does not invalidate the contract, because it is held as something merely accidental.

3. If the mode is base or impossible, it is held as not added; nor is the contract invalid unless the mode is repugnant to its nature, or unless the will of the contracting person was wholly restricted to it.

4. In a contract to a day, the obligation arises immediately, but the effect is suspended to the determined day.

5. In a contract under a cause (because), or under a demonstration (I sell this or so much), error does not invalidate unless it pertains to the essence of the thing.

6. If the error is in quantity, the whole thing is owed if the quantity was designated demonstratively; but if taxatively, as they say, the excess of quantity is not owed. Moreover, the thing is judged designated demonstratively if the thing is expressed in the first place, and afterwards its quantity; e.g. I bequeath to Titius my farm of thirty acres; but taxatively if in the first place the quantity is expressed, and then the thing; e.g. I bequeath three gold coins in such a box. But the circumstances of the things must be weighed.

7. In a contract under a penalty, that is, whenever a penalty is imposed on one withdrawing, this penalty is owed from justice if it is requested, at least if the contract has not been fulfilled culpably. Nevertheless the penalty must be moderate; otherwise it would not oblige.

8. In a contract under a disjunction, e.g. I promise an ox or a horse, no determined thing is owed, and the payment of one removes the whole obligation. The choice of the thing of itself belongs to the debtor.

262. A contract under a mode,⁵⁷ or a modal contract, is that in which the end or use of the matter concerning which the contract is made is stipulated, or in which a special burden is imposed upon one contracting party. This mode is wont to be expressed by the particles: that, for, under this law, for the purpose of, etc. E.g., I give you 100 francs that you may enter a monastery; I give you 100 francs for buying books; I lend you this garment under this law, that you may use it on such a day, etc. - A contract under a condition differs from a contract under a mode in this, that the condition suspends the obligation of the contract until the condition is fulfilled, but the mode does not suspend the effect of the contract and imposes only the obligation of observing the mode. For a mode is nothing other than a burden added to an absolute and substantially complete contract, to which it stands as the accessory to the principal.⁵⁸ Therefore, a mode is never the primary motive of the contracting party. Consequently, a properly modal contract is not revoked if the mode is not observed. In practice, however, a modal contract is often distinguished from a conditional contract only with difficulty. If the mode imposed was held by either contracting party as the principal motive or at least as a condition without which not, the contract is to be considered conditional and not modal; but if the mode imposed was a secondary motive, the contract is held as modal.

⁵⁷ In German: contracts with an imposed charge (Verträge mit Auflage).

⁵⁸ Billuart, l.c., § 2.

474. A modified or qualified contract in obligation depends upon the nature of the added clause. - The principal modal contracts are:

1. A contract to a day, whose execution, namely, is established as to be fulfilled at a certain time. The obligation from this contract, in the creditor, consists in this, that he cannot exact execution before the time fixed beforehand, although at once he has the right to the debt to be paid afterward. Yet in civil law there is exception: a) the case in which the debtor cedes his goods, whether by force or without force (C. C., a. 1188; C. Com., a. 450); b) the case in which by his own deed the debtor diminishes the securities given to the creditor for payment (a. 1188); - in the debtor: he cannot pay before the established time, whenever this time is constituted for the grace of the creditor; but otherwise if for the grace of the debtor (a. 1186). Generally, unless the contrary is proved, the term is judged determined in favor of the debtor (a. 1187).

2. A contract under a cause is that to which is added the reason because of which it is contracted. The reason is either final or impulsive, and concerning it those things must be said which we said concerning error about the motive of contract.

3. A contract under demonstration is that in which some sign is appended indicating the thing about which or the person with whom one contracts. This contract does not have force if error concerning the sign is turned into substantial error; otherwise it has force.

4. A contract under penalty is that in which, for strengthening the execution of the contract, a penalty to be paid is established if the contract lacks its effect. In this contract there are two obligations: one principal and absolute; the other secondary and in some way conditional. By the consent of all, a penal agreement is accessory to the principal; hence a) it does not subsist if the principal is null; but the principal is not destroyed by the addition of a penal clause (a. 1327); b) the creditor can urge the principal obligation while neglecting the penal one (a. 1228), but he cannot exact the principal and the penal at the same time, unless the penalty was added because of delay (a. 1229); c) if the debtor in delay has begun to execute the principal obligation, the penalty can be diminished by the judge (a. 1231).

5. A contract under disjunction is that by which someone is held to give, do, or omit one out of two or several things. By either obligation the contract is satisfied (a. 1189); - the choice is left to the debtor, unless it has expressly been conceded to the creditor.

A mode is an added quality, for the most part not suspending the contract, but adding something to the burden or favor of one of the contracting parties. Modal contracts are made chiefly: 1st, to a day; 2nd, under a cause; 3rd, under a penalty; 4th, under demonstration; 5th, under disjunction.

Concerning modes the following things are to be noted:

1st. A mode must be observed from justice, unless it is repugnant to the substance of the contract.

2nd. Its violation ordinarily, and unless it has been agreed otherwise, does not invalidate the contract, because it is held as something merely accidental.

3rd. If the mode is base or impossible, it is held as not added; nor is the contract invalid, unless the mode is repugnant to its nature, or unless the will of the contracting party was altogether restricted to it.

4th. In a contract to a day, obligation arises immediately, but the effect is suspended until the determined day.

5th. In a contract under a cause (because) or under demonstration (I sell this or so much), error does not invalidate unless it pertains to the essence of the thing.

6th. If the error is in quantity, the whole thing is owed if the quantity was designated demonstratively; but if taxatively, as they say, the excess of quantity is not owed. Moreover, a thing is judged designated demonstratively if the thing is expressed in the first place and afterwards its quantity, for example, I leave to Titius my estate of thirty acres; but taxatively, if the quantity is expressed in the first place, and then the thing; for example, I leave three gold coins in such a casket. But the adjuncts of things must be weighed.

7th. In a contract under a penalty, that is, as often as a penalty is imposed on the one withdrawing, this penalty is owed from justice, if it is sought, at least if the contract has culpably not been fulfilled. Nevertheless the penalty must be moderate; otherwise it would not oblige.

8th. In a contract under disjunction, for example, I promise an ox or a horse, no determined thing is owed, and the payment of one takes away the whole obligation. Choice of the thing in itself pertains to the debtor.

VIII. A mode added to a contract is a certain burden to be fulfilled by him who undertakes and accepts the contract. This mode does not suspend, but supposes a perfect contract. A demonstration in a contract is when something is indicated either of the thing concerning which the disposition is made, or of him with whom the contract is made; for example, if it be said: I sell you the horse which I bought at Padua for your sake; I enter upon a contract with you because you are my friend. These circumstances commonly do not vitiate the contract, because they do not give cause to the contract. Nor is every cause therefore a chief cause which, had the contracting party known it, he would have abstained from the contract; but that is called the principal cause which in fact brings in a grave change, and which, being known, would have drawn back the contracting party from entering upon the contract.

Certain Catholics in a certain town wished a certain religious Order to have a church in their town; indeed, after a large sum of money had been collected, they bought land on which a house and church might be built and handed it over to that Order by a gift between living persons. The diocesan bishop, however, although at first he neither gave nor denied consent, after the land had been handed over and the matter had been discussed with the canons, absolutely refused to give consent, so that there was no hope that the Order would come to the town. When these things became known, the donors expected that the land would be returned to them; the price of it after it had been sold, however, was retained by the Order. Hence it is asked:

1. What is a mode added to a contract, and how is it distinguished from a condition?

2. What is a gift between living persons, and can it be revoked?

3. In whom is the ownership of ecclesiastical goods, and what is to be said of their alienation?

4. What is to be said of the case?

1. What is a modus added to a contract, and how does it differ from a condition?

A modus is an obligation in justice to do something added to a contract, but the validity of the contract does not depend on the fulfilment of the modus. A condition is either precedent or subsequent. The former is an agreement that the contract shall depend on the happening of a future event. If the happening of the future event will, according to the agreement of the parties, discharge the contract, we have a condition subsequent.

2. What is a donatio inter vivos, and can it be revoked?

A donatio inter vivos is distinguished from a gift mortis causa and is irrevocable by English law.

3. Who has the ownership of ecclesiastical property and can it be alienated?

According to the common opinion the ownership of ecclesiastical property is in the community to whom it was given by the donors, whether that community be the province, the diocese, the parish, a Religious order, or some other religious corporation. It can not be alienated without the permission of the Holy See under pain of excommunication.

4. The case. Some Catholics wanted a certain Religious order to come and settle in their town. They collected a sum of money, bought a site, and presented it to the order. The bishop, however, after consulting his canons, absolutely refused his permission, so that there was no hope of the order being able to come to the town. It therefore sold the site, and kept the proceeds, although those who had presented the site expected that it would be returned to them after the bishop had refused his consent.

From the answers given to the questions above, it is clear that the order acted perfectly rightly, and indeed could not without the permission of the Holy See return the site to the donors. It was given absolutely, not conditionally, with the obligation to use it if possible for a certain purpose. Through no fault of theirs that purpose became impossible, but the site remained theirs and ecclesiastical property.