Hazelton v. Sheckells
Headline: Court refuses to enforce a land-sale deal that paid a private seller for lobbying Congress to authorize the purchase, ruling contingent payments to procure government legislation are against public policy.
Holding: The Court held that a contract promising payment for services to induce Congress to authorize a land purchase is void and cannot be specifically enforced because it tends to encourage improper solicitation of government favors.
- Bars enforcement of contracts paid to induce government legislation or contracts.
- Makes contingent payments for lobbying government an invalid basis for specific performance.
- Affects sellers, agents, and brokers who profit from persuading government bodies to act.
Summary
Background
A private landowner entered a written offer to sell part of a city square to the United States for $9,000 while Congress was considering an appropriation to buy the site for a hall of records. The owner claimed the buyer promised the sale in part because the seller or his agent had spent time and money before and after the contract to bring the property to Congress’s attention, preparing briefs and arguing for the appropriation. The bill sought a court order forcing the defendant to convey the land; the defendant refused and offered to sell directly to the Government. Lower courts dismissed the bill and the seller appealed.
Reasoning
The Court assumed the procedural facts in the bill but focused on whether the contract’s stated consideration was lawful. A key part of the bargain was payment tied to services that sought to secure legislation or official action. The Court explained that agreements promising contingent compensation to procure legislation or government contracts tend to encourage improper solicitations and are against public policy. Citing earlier decisions, the Court held that such a promise makes the entire contract unenforceable, even if the particular services performed may have been legitimate.
Real world impact
The ruling means courts will not order specific performance for land-sale agreements that rely on payments conditioned on persuading Congress or other government bodies to act. Sellers, agents, or brokers who expect contingent rewards for obtaining government legislation or contracts cannot rely on courts to enforce those deals. The dismissal of the bill was therefore affirmed by the Court.
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