## Facts

- Jacob Martin transported goods pursuant to an arrangement with Schoenberger acting for the Reliance Transportation Company.
- Schoenberger guaranteed Martin a minimum of $3,000 in commissions.
- In return, Martin agreed not to transport goods for others destined for any place west of Hollidaysburg, Pennsylvania.
- Martin performed some hauling for Reliance, generating about $600 in commissions.
- Evidence showed Martin also carried goods for others, including shipments destined west of Hollidaysburg.
- Martin sued to recover the full $3,000 guaranteed commissions despite his competing shipments.

## Issues

1. Whether a party who breaches an entire (indivisible) contract may nonetheless recover under the contract based on partial performance.
2. Whether violation of an exclusivity term that forms part of the consideration bars recovery on a guaranteed-commission promise.

## Decision

- The Supreme Court of Pennsylvania affirmed judgment for Schoenberger.
- The court treated the agreement as an entire contract in which Martin’s exclusivity promise was a condition of his right to the guaranteed minimum commissions.
- Because Martin breached the exclusivity obligation, he could not recover the guaranteed $3,000.
- The court rejected partial-recovery approaches that would allow a defaulting party to recover on the agreement despite nonperformance.

## Legal Principles

- Under an entire (indivisible) contract, a party in default cannot recover on the contract for partial performance when full performance is required as a condition of the other party’s obligation.
- When contractual obligations are interdependent, breach of a material term defeats the breaching party’s claim to the contract’s promised compensation.
- Contract law may deny recovery to a breaching party to avoid rewarding selective performance and to protect faith and fair dealing in exchange-based agreements.

## Conclusion

A party who breaches an entire contract’s essential performance condition—here, an exclusivity undertaking given in exchange for a guaranteed minimum—cannot enforce the other party’s promise for additional compensation based on partial performance.


Martin v. Schoenberger, 8 Watts & Serg. 367 (Pa. 1845)