Salsbury v. Northwestern Bell Telephone Co.

221 N.W. 2d 609 (Iowa 1974)

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Nature of the Case

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Facts

Northwestern (D) promised by a letter to give Charles City College (P) $15,000. The letter was treated just like other pledge cards. D's letter was assigned to a supplier of the college but was never actually transferred. The supplier received an unsigned pledge card to reflect D's pledge. The chairman of the board of trustees for the college Salsbury (P) executed a personal guarantee to gain the credit from the supplier who used the pledges as security interests. The pledges were assigned to P without P's knowledge of D's letter. The college was closed, and P sued D to recover the pledged amount. The court held that the pledge to P was enforceable as a matter of public policy. D appealed; there was no consideration.