United States Supreme Court
106 U.S. 124 (1882)
Pritchard, a Louisiana citizen, executed an appeal bond on behalf of a railroad against whom a judgment had been rendered by a Louisiana court. Pritchard then entered into an agreement with Norton (defendant), a New York citizen, and McComb, a Delaware citizen, whereby Norton and McComb executed a bond of indemnity in favor of Pritchard if the railroad’s appeal were unsuccessful. The indemnity was signed and delivered in New York. After the railroad’s appeal failed and Pritchard became obligated to pay the judgment, his executrix (plaintiff) sued Norton on the indemnity. Norton defended against the suit on the grounds that the indemnity lacked consideration. Under New York law, as proposed to apply by Norton, the fact that Norton and McComb had never requested that Pritchard become a surety for the railroad deprived the indemnity of consideration. Under Louisiana law, on the other hand, Pritchard’s preexisting obligation to the railroad constituted adequate consideration. A federal circuit court in Louisiana decided in favor of Norton. Pritchard’s executrix appealed to the United States Supreme Court.
Rule of Law
Holding and Reasoning (Matthews, J.)
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