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Part Payment in Discharge of Whole


PART PAYMENT IN DISCHARGE OF WHOLE. A promise to re linquish part of a debt, or take part in discharge of the whole is a nudum pactum and without legal obliga tion. (Day v. Gardner, 42 N. J. Eq. 199.) "The pay ment of a smaller sum in satisfaction of a larger is not a good discharge of a debt. It is, in fact, doing no more than a man is already bound to do, and it is no consideration for a promise, express or implied, to fore go the residue of the debt. There must be something different to that which the recipient is entitled to de mand, in the thing done or given, in order to support his promise. The difference must be real, but the fact that it is slight will not destroy its efficacy in making the consideration good. Thus the giving a ne gotiable instrument for a money debt, or the gift of a horse, a hawk or a robe, in satisfaction is good." (An son on Cont. p. 83.) Where the damages for the breach of a contract are uncertain, a payment of a certain sum is a valid con sideration for the promise to forego a larger but un certain amount. (Potter v. Douglass, 44 Conn. 541; Goss v. Eliason, 136 Mass. 503; Bedell v. Bissell, 6 Col. 162.) If the damage is certain in amount, then the promise to forego such claim, or a portion of it, is only supported by giving something different in kind, or by a payment at an earlier date. And whether certain or uncertain, the consideration for the promise to forego must be executed, that is, carried out, as an accord and satisfaction. (Anson on Cont. p. 85; Daniels v. Hollen beck, 19 Wend. 408; Summers v. Hamilton, 56 Cal. 593.) For a modification of this latter rule, see Whit sett v. Clayton, 5 Col. 476; Schweider v. Lang, 29 Minn. 254.

A composition by a debtor with his creditors, by which each agrees to take a part in satisfaction of the whole of his claim is an apparent exception to the rule that part payment will not discharge the whole debt. It is said that in the case of a composition with creditors, the consideration is the agreement between the differ ent parties, forming in reality a new agreement, with different parties, and for a previous debt.

debt, promise and satisfaction