Court Opinion

ID: 5474514
Source: CourtListenerOpinion
Date Created: 2022-01-09 20:46:00.032528+00
Date Added: 2024-06-11T08:33:26.215683
License: Public Domain

Platt, J.
delivered the opinion of the Court.
The question is, whether the third plea sets out such an accord and satisfaction as will bar the action ?
The general rule is well settled, that the payment of a less sum of money than the whole debt, without a release, is no satisfaction ofathe plaintiff’s claim. (Cumber v. Warn, 1 Stra. 426. Harrison v. Wilcox and Close, 2 Johns. Rep. 449. Fitch v. Sutton, 5 East, 232. Seymour v. Minturn, 17 Johns. Rep. 169.) And a mere agreement to accept less than the real debt, would be nudum pactum. (Heathcote v. Crookshanks, 2 Term Rep. 24.) But, in my judgment, this case is distinguishable from the cases cited. Here was a beneficial interest acquired, and a valuable consideration received by the plaintiffs, when they agreed to accept less than their whole demand. The plea avers that three promissory notes, drawn by the defendant, payable to David W. Childs, and by him indorsed, were delivered to the plaintiffs, and by them accepted and received from the defendant, in full satisfaction and discharge of the promises stated in the declaration. It would be an abuse of terms to call this a mere nudum pactum. Here was inconvenience to the defendant, in procuring a surety ; and also a benefit to the plaintiffs. The defendant held the notes, with Childs' indorsement, and offered them, to secure 2,750 dollars of the debt, if the plaintiffs would relinquish the residue of their claim. It is to be inferred, that Childs lent his indorsement for the sole purpose of effecting this compromise. The plaintiffs accepted the notes as payment of the whole debt; and, I think, good faith and sound principle require that *79this should be deemed a valid accord and satisfaction, to bar the plaintiff’s action. It would operate as a fraud upon Childs, the indorser, whose means of reimbursement from the defendant would be greatly impaired, if this plea be not sustained. If Childs had been the maker, and Hitchcock the mere indorser, the case, as to him, (Childs,) would be widely different; for if Childs, as a real debtor, had made the notes, it would be immaterial to him whether he paid them to Hitchcock or to his indorsees. But independent of the consideration due to the surety, I am of opinion, that if a debtor offers additional security, on condition that his creditor shall give up a portion of the debt, and the creditor accepts such security for a less sum, as a satisfaction for the whole debt, it is a valid discharge, on the ground of accord and satisfaction. (Sheehy v. Mandeville, &c., 6 Cranch, 253.)
In the case of Fitch v. Sutton, (5 East, 231.) Lord Ellenborough said, “ It is impossible to contend that acceptance of 17 pounds, 10 shillings, is an extinguishment of a debt of 50 pounds. There must be some consideration for the relinquishment of the residue ; something collateral, to show a possibility of benefit to the party relinquishing his further claim; otherwise, the agreement is nudum pactum $ but the mere promise to pay the rest when of ability, put the plaintiff in no better condition than he was before.”
In the case of Steinman v. Magnus, (11 East, 390.) Lord Ellenborough said, “ It is true, that if a creditor simply agree to accept less from his debtor than his just demand, that will not bind him ; but if upon the faith of such an agreement, a third person be lured in to become surety for any part of the debt, on the ground that the party will be thereby discharged of the remainder of his debt, the agreement will be binding.” Here, the plaintiffs have, in fact, “ lured in” Mr. Childs. They agreed to purchase his indorsement, and the price to be paid for it was the portion of the debt which they agreed to relinquish to Hitchcock; and why shall they not pay the price, as well as enjoy the benefit of that contract ?
I am of opinion that the defendant is entitled to judgment on the demurrer.
Judgment for the defendant.