there be any reasonable doubt about the validity of the claim, a compromise thereof is a sufficient consideration for a note, and in an action on such a note the invalidity of the claim compromised cannot be asserted. Ignorance of the maker's rights in respect to an alleged liability will not affect the validity of a note given on account of such liability. A note given by the treasurer of a corporation in consideration of the discharge of a disputed claim against such corporation is valid."

8

Where a note is given in settlement of a claim which is the subject of litigation, there is no question about the sufficiency of the consideration.10 Where a note is given in compromise and settlement of a claim in suit, in the absence of fraud or knowledge on the part of the plaintiff that his suit was fictitious, it is no defense to an action upon the note that there was a good and meritorious defense to the original claim.11

7. Curry v. Davis, 44 Ala. 281; Tyson v. Woodruff, 108 Ga. 368, 33 S. E. 981; Keefe v. Vogle, 36 Iowa, 87; Cobb v. Arnold, 8 Metc. (Mass.) 403; Easton v. Easton, 112 Mass. 438. 8. Ignorance of maker's rights.In the case of Bennett v. Ford, 47 Ind. 264, it was held that it was no defense to a suit on a promissory note that the defendant gave the note in ignorance of the law, believing himself to be liable for the injury done by his runaway team, when he was not so liable. See also Pickel v. St. Louis Chamber of Commerce, 80 Mo. 65.

Ky. L. Rep. 652, 58 S. W. 525; General Electric Co. v. Nassau Electric R. Co., 161 N. Y. 656, 57 N. E. 1110.

9. National Bank v. Foster, 85 Hun (N. Y.), 376, 32 N. Y. Supp. 1031.

10. Wyatt v. Evins, 52 Ala. 285; Jones v. Rittenhouse, 87 Ind. 348; Brown v. Ladd, 144 Mass. 310, 10 N. E. 839; Grant v. Chambers, 30 N. J. L. 323; Brooklyn Bank v. Wearing, 2 Sandf. Ch. (N. Y.) 1; Wesselman v. Stuart, 30 Misc. (N. Y.) 808, 61 N. Y. Supp. 1110.

11. Compromise of claims.- In tl case of Feeter v. Weber, 78 N. Y. 334, the court said: "There would Where it appeared that the defend- be very little use in compromisant had believed himself not liable ing controversies, if, after such comto pay the plaintiff's claim, but the plaintiff's attorney insisting that he was bound, prevailed upon him to execute a note for the amount, the defendant will be required to pay the note, where it does not appear that the defendant relied upon the attorney's opinion and there was no evidence tending to show fraud or imposition by the plaintiff's attorney. Daily v. Jessup, 72 Mo. 144.

promise, the whole matter remained open, and it were a good defense to a note given in settlement that a meritorious defense existed to the original claim. Where facts out of which a defense arises are known to the party making the claim, and fraudulently concealed from, and unknown to the other party at the time of the compromise, such fraud may be shown; but, in the absence of any A note given in settlement of claims such fraud, evidence of the mere fact of doubtful validity is valid if the that a defense existed is not admismaker had knowledge of all the facts sible." Citing Stewart v. Ahrenfeldt, affecting their validity at the time 4 Denio (N. Y.), 189; Russell v. Cook, of the execution of the note. Mory 3 Hill (N. Y.), 504. See also Smith v. Laird, 108 Iowa, 670, 77 N. W. 835. v. Richards, 29 Conn. 332; Spielberger And see Hillenbrand v. Shippen, 22 v. Thompson, 131 Cal. 55, 63 Pac. 132.

r. Forbearance.-- Forbearance to prosecute a legal claim is a sufficient consideration to support a promissory note.12 And an agreement whereby the payee of a note forbears to contest a will is supported by sufficient consideration.13 But a forbearance to sue for what one has no legal right to recover is not a sufficient consideration for a note.14

s. Extension of time.- Extension of time upon an indebtedness is sufficient consideration for a promissory note given as collateral therefor.15 A new note payable one day after date, given in consideration of the surrender of a former note past due, is upon a sufficient consideration. The legal forbearance for one day is sufficient to support the new note. The law does not weigh the quantum of the consideration. 16 An agreement to extend the time of payment of the debt of a third party is a sufficient consideration for a promise to pay that debt.17 The extension of time for the payment of a mortgage is a lawful consideration for a promissory note for an additional sum.18 The agreement for delay need

12. Anstell v. Rice, 5 Ga. 472; Jennison v. Stafford, 1 Cush. (Mass.) 168, 48 Am. Dec. 55; Robertson v. Gould, 11 id. 55; Abbott v. Fisher, 124 Mass. 414; Lavell v. Frost, 16 Mont. 93, 40 Pac. 146.

14. Foster v. Metts, 55 Miss. 77, 30 Am. Rep. 504; Salck v. Moss, Dud. (Ga.) 161.

15. Rockafellow v. Peat, 40 Ark. 69; Jewell Belting Co. v. Rogers, 84 Ill. App. 249 (revd. on other grounds, In New York in the case of Me- 56 N. E. 1017); Gates v. Hamilchanics & Farmers' Bank v. Wix- ton, 12 Iowa, 50; Atherton v. Marcy, son, 42 N. Y. 438, the plaintiff de- 59 Iowa, 650, 13 N. W. 759; Union manded that a certain bank should Banking Co. v. Martin's Est., 113 pay or secure certain moneys due and Mich. 521, 71 N. W. 867; Whitt to become due, and also to return v. Bailey, 22 Ky. L. Rep. 1015, certain notes held by the bank for 59 S. W. 514; Cox v. Sloan, 158 collection. The defendants requested Mo. 430, 57 S. W. 1052; Red River the plaintiff not to take legal action Valley Nat. Bank v. North Star Boot for the collection of the indebtedness & Shoe Co., 8 N. D. 432, 79 N. accrued nor to withdraw the notes W. 880; Jarvis v. Roentgen, 59 Mo. held for collection, and in consideration of plaintiff's granting this request, defendants executed and delivered and plaintiff accepted a promissory note payable in one month. was held that the forbearance to sue and to withdraw the notes held for collection was a valid consideration, rendering the defendants liable on the note. See also Lewis v. Rogers, 34 N. Y. Super. Ct. 64; Grocers' Bank v. Penfield, 7 Hun (N. Y.), 279, affd. in 69 N. Y. 502, 25 Am. Rep. 231; Meltzer v. Doll, 91 N. Y. 365.

It

App. 75; Brainerd v. Harris, 14 Ohio, 107, 45 Am. Dec. 525; Gorder v. Freehold Bank (Pa.), 7 Átl. 144; Ballard v. Burton, 64 Vt. 387, 24 Atl. 769, 16 L. R. A. 664.

16. Whelan v. Swain, 132 Cal. 389, 64 Pac. 560.

17. Germania Bank v. Michaud, 62 Minn. 459, 65 N. W. 70, 30 L. R. A. 286; Harris v. Harris, 180 Ill. 157, 54 N. E. 180; Union Banking Co. v. Martin's Est., 113 Mich. 521, 71 N. W. 867.

18. Hubbard v. Fletcher, 61 Minn. 148, 63 N. W. 612; Foster v. Wise, 27

13. Hindert v. Schneider, 4 Ill. La. Ann. 538; Hancock v. Hodgson, 3 App. 203.

Scam. (Ill.) 329.

not be express; the taking of the new note, payable at a future day, imposes upon the payee the duty of waiting until the maturity of the new note.19

t. Fluctuating balances.- A fluctuating balance may form a consideration for a bill or note." 20 As where bills or notes are deposited as a security for the balance of an account current, the successive balances form a shifting consideration for the bill or note. But where the account has been settled or transferred prior to the execution of the note, the consideration of course fails, and the note is invalid.22

21

51. Illegality of consideration.

a. In general. An action cannot be maintained upon a note given for an illegal consideration.23 At common law considerations are illegal which (1) violate the rules of religion or morality, or (2) are such as contravene public policy. As stated by Mr. Byles:24 "Though the law does not pretend to enforce religious or moral obligations as such, yet it seizes every opportunity of countenancing them; and therefore will not assist a man whose claim of redress is founded on their violation." Many acts in themselves immoral are made by statute illegal considerations for the support of commercial paper.

b. Immorality. A note given for future illicit cohabitation is invalid,25 although if it be given in consideration of past cohabitation it is enforceable.26 If it be given for both past and future illicit cohabitation it is void.27 So the rent of lodgings, knowingly let for the purpose of prostitution, is an illegal consideration.28

19. Whelan v. Swain, 132 Cal. 389, S. C. 149, 10 S. E. 937; Potter v. 64 Pac. 560. Gracie, 58 Ala. 303, 29 Am. Rep. 748; Walker v. Gregory, 36 Ala. 180.

20. Byles on Bills (16th ed.), p. 151; Pease v. Hirst, 10 B. & C. (Eng.) 122; Colleridge v. Farquhar son, 1 Stark. (Eng.) 259; Richards v. Macey, 14 M. & W. (Eng.) 484.

21. Byles on Bills (16th ed.), p. 151; Atwood v. Crowdie, 1 Stark. (Eng.) 483.

22. Johnson v. Mitchell, 14 Colo. 227, 23 Pac. 452; First Nat. Bank v. Henry, 156 Ind. 1, 58 N. E. 1057.

23. Ketchum v. Scribner, 1 Root (Conn.), 95; Parsons v. Randolph, 21 Mo. App. 353; Brisbane v. Lestarjette, 1 Bay (S. C.), 113.

24. Byles on Bills (16th ed.), p. 161. 25. Singleton v. Bremar, 1 Harp. (S. C.) 201; Massey v. Wallace, 32

26. Brown v. Kinsey, 81 N. C. 245; Burgen v. Straughn, 7 J. J. Marsh. (Ky.) 583; People v. Hayes, 70 Hun, 111, 24 N. Y. Supp. 194; affd., 140 N. Y. 484, 35 N. E. 951.

27. Massey v. Wallace, 32 S. C. 149, 10 S. E. 937.

28. Girardy v. Richardson, 1 Esp. (Eng.) 13; Howard v. Hodges, Selw. N. P. (7th ed.) 68. Rent for houses used for prostitution cannot be recovered. Dougherty v. Seymour, 16 Colo. 289, 26 Pac. 823; Ralston v. Boady, 20 Ga. 449; Ashbrook v. Dale, 27 Mo. App. 649; Hunstock v. Palmer, 4 Tex. Civ. App. 459, 23 S. W. 294.

And it has been held that a note and chattel mortgage given for furniture sold for use in a house of prostitution, with the knowledge of the vendor, are void as based upon an illegal consideration;29 although it would be otherwise where the vendor had no knowledge of such illegal use. 30 A note by a husband to his wife, upon the promise of the wife to withdraw all opposition to proceedings for divorce instituted by him, is founded upon an illegal consideration.31

c. Against public policy.- Commercial paper based upon considerations which contravene public policy are void.3 Among such considerations are those in restraint of marriage,33 in general restraint of trade,34 for the perpetration or concealment of crime,35 for the commission of a fraud upon the public,36 for the purchase

29. Reed v. Brewer (Tex. Civ. App.), Neb. 981, 56 N. W. 724; Irvin v. Ir36 S. W. 99. vin, 169 Pa. St. 529, 32 Atl. 445, 29 L. R. A. 292.

39

and sale of so-called "Bohemian Oats" at an exorbitant price,37 for services performed as a lobbyist,38 for the appointment, resig nation, or breach of duty of a person in a position of trust, or for influencing in any way the actions of a person occupying an official position.40 And a bill or note given to a creditor to induce him to withdraw his opposition to his debtor's discharge in bankruptcy or insolvency proceedings, is invalid as based upon a consideration

37. McNamara v. Gargett, 68 Mich. 454, 36 N. W. 218; Davis v. Seeley, 71 Mich. 209, 38 N. W. 901.

Moss v.

tavit of estate is invalid. Cohen, 11 Misc. 184, 32 N. Y. Supp. 1878; s. c., 15 Misc. 108, 36 N. Ÿ. 38. In New York, see Harris v. Supp. 265. As to indemnity in other Roof, 10 Barb. (N. Y.) 489; Rose v. cases, see Shotwell v. Hamblin, 23 Truax, 21 Barb. (N. Y.) 361; Brown Miss. 156, 55 Am. Dec. 83; not necesv. Brown, 34 Barb. (N. Y.) 533; Mills sarily void, Griffiths v. Hendenburgh, v. Mills, 40 N. Y. 543; Cary v. West- 41 N. Y. 464; Martin v. Bollenbaugh, ern Union Tel. Co., 47 Hun (N. Y.), 42 Ohio St. 508, unless act indemnified 610; Cheeseborough v. Conover, 140 is unlawful, Anderson v. Farns, 7 N. Y. 382, 35 N. E. 633, where it was held that it is the right of every citizen who is interested in any proposed legislation to employ an agent for compensation payable to him, to draft his bill and explain it to any committee, or to any member of a committee, or of the legislature, and ask to have it introduced; and contracts which do not provide for more, and services which do not go farther, violate no principle of law or rule of public policy; Harris v. Simonson, 28 Hun (N. Y.), 318.

In other jurisdictions the following cases are applicable: Trist v. Child, 21 Wall. (U. S.) 441, 22 L. Ed. 623; Coquillard v. Bearss, 21 Ind. 479, 83 Am. Dec. 362; Houlton v. Dunn, 60 Minn. 26, 61 N. W. 898, 30 L. R. A. 737; Spalding v. Ewing, 149 Pa. St. 375, 24 Atl. 219, 15 L. R. A. 727.

Blackf. (Ind.) 343; Stark v. Raney, 18 Cal. 622; Harrington v. Crawford, 61 Mo. App. 221; Greenwood v. Colcock, 2 Bay (S. C.), 67; Barnes v. Jackson, 2 Sneed (Tenn.), 416; Perkins v. Proud, 62 Barb. (N. Y.) 420; Webber's Executors v. Blunt, 19 Wend. (N. Y.) 188.

Payment of fines or costs by note not illegal, see Town of Stonington v. Powers, 37 Conn. 439; Blain v. Hitch, 70 Ga. 275; Stafford v. Jackson, 14 N. H. 16. But it has been held that since the taking of a note for the payment of fines imposed by a magistrate is in violation of a public duty, the note is void as against public policy. Kingsbury v. Ellis, 4 Cush. (Mass.) 578; Bills v. Comstock, 12 Metc. (Mass.) 468; Kendrick v. Crowell, 38 Me. 42; McCartney v. Wilson, 17 Kan.

294.

40. In New York it has been held that a note given to procure an officer to violate his official duty is against public policy and void in the hands of the original payee, or any subsequent holder thereof with knowledge of its character. Devlin v. Brady, 36 N. Y. 531. But see Lyon v. Mitchell, 36 N. Y. 235, 93 Am. Dec. 502.

39. Appointment of administrator. -Porter v. Jones, 52 Mo. 399; Aycock v. Braun, 66 Tex. 201, 18 S. W. 500. As to resignation or relinquish ment of right of administration, see Cunningham v. Cunningham, 18 B. Mon. (Ky.) 19. 68 Am. Dec. 718; Ellicott v. Chamberlain, 38 N. J. Eq. 604, 48 Am. Rep. 327; Staunton v. Parker, 19 Hun (N. Y.), 55; Withers v. Ewing, 40 Ohio St. 400; Bowers v. Bowers, 26 Pa. St. 74, 67 Am. Dec. 398. Note to secure resignation from public office is void. Meacham v. Dow, 32 Vt. 721; Eddy Facts to warrant finding that officer v. Capron, 4 R. I. 394, 67 Am. Dec. 541. was improperly influenced, see Barry Breach of duty.- Bond to indemnify v. Capen, 151 Mass. 99, 23 N. E. 735, executors against contemplated devas- 6 L. R. A. 808.

A bond given to a third party for the purpose of influencing the action of an alderman in the discharge of his duties is void. Cook v. Shipman, 24 Ill. 614; s. c., 51 Ill. 316.