XVIII. against any party who would have been discharged by such CHAPTER payment, i.e., all parties subsequent to the one for whose honour payment was offered. As no protest is necessary in case of dishonour of a note, None on whether inland or foreign, there is in general no payment promissory supra protest (s). (s) The law merchant as to payment supra protest does not apply to promissory notes. Story on Notes, s. 453. Whoever, therefore, pays a note for another without authority, express or implied, does so at his peril, but may, if the note be indorsed notes. 308 CHAPTER SATISFAC- THE Code by s. 97 preserves all the rules of the Common Law and the Law Merchant relating to contracts on bills and notes, save those inconsistent with its express provisions. The nature and effect of such dealings with the acceptor or other principal debtor as discharge the drawer or indorser will be discussed in the chapter on principal and surety. Payment in due course is, as we have seen, a discharge of the bill or note; but the rights of the holder against the acceptor or maker and other parties may be satisfied, extinguished or suspended in other ways besides payment. A simple contract may be without a release and without (a) Langden v. Stokes, Cro. Car. 383; Com. Dig. Action on Case in Assumpsit, G.; Cousin & Holland's case, 2 Leo. 214; King v. discharged before breach, satisfaction (a). But after Gillett, 7 M. & W. 55; Dobson v. XIX. breach, unless there be a release, there must be satisfac- CHAPTER tion (b). Accord without satisfaction is no plea, and no action lies on an accord (c). A satisfaction must be beneficial to the plaintiff (d). It Its requisites. has been considered that it must come from the defendant, or at least from some one who represents him (e), but at this day probably satisfaction by a stranger would be held good (). Payment by the debtor himself of a sum smaller than Payment of a the debt is no satisfaction (g). But payment of a smaller smaller sum sum by a third person has been held to be a discharge of by a third the whole debt. The defendant was drawer of a bill for 18. 3s. 11d., and the plaintiff had taken from the defendant's father 97, in satisfaction of the whole debt. The (b) A release is a formal waiver by deed under seal. But liability under any contract on a bill or note may be waived by the holder before or after maturity, and as it should seem, with or without consideration, and even by parol, but this will not touch a holder in due course. See Chapter on ACCEPTANCE, ante, p. 266. (c) Allen v. Harris, 1 Ld. Ray. 122; Lynn v. Bruce, 2 H. Bl. 117. Unless another person is party to it. Henderson v. Stobart, 5 Ex. 99. (d) Cumber v. Wane, 1 Stra. 426; Heathcote v. Crookshanks, 2 T. R. 24. (e) Grymes v. Blofield, Cro. Eliz. 541; James v. Isaacs, 12 C. B. 791; Kemp v. Balls, 10 Exch. 607; Edgecombe v. Rodd, 5 East, 294. The effect of satisfaction by a stranger was fully discussed in Jones v. Broadhurst, 9 C. B. 173; and see a very learned judgment delivered by Mr. Justice Maule in Belshaw v. Bush, 11 C. B. 207, to the effect that satisfaction by a stranger is good. See also Chap. XVIII. It must be fully executed. James v. David, 5 T. R. 141; Bac. Ab. 3; Walker v. Seaborne, 1 Taunt. 526. Mutual promises, with an immediate remedy on them, have, however, been considered a good accord and satis faction. See Com. Dig. Accord, B. 4; Cartwright v. Cooke, 3 B. & Ad. 701; Good v. Cheeseman, 2 B. & Ad. 328; but see Bayley v. Homan, 3 Bing. N. C. 915; 5 Scott, 94. Is not the distinction this? If the mere agreement were intended to be the satisfaction, it need not be executed; if its performance were intended as the satisfaction, it must be executed. See Reeves v. Hearne, 1 M. & W. 323; Sard v. Rhodes, 1 M. & W. 153; Lewis v. Lyster, 2 C., M. & R. 707. In the Roman law, a stipulation by which a former obligation was taken away by the substitution of a new one was familiar. It was called Novatio. It exists at this day in the French law. (Code Civil, 1271.) Novation might be either without a change of persons, sine delegatione, or with a change of persons, cum delegatione. There might be a change of the debtor's person, expromissio, or of the creditor's, cessio. (f) Belshaw v. Bush, ubi supra. (g) Fitch v. Sutton, 5 East, 230. Unless the demand be unliquidated. Wilkinson v. Byers, 1 Ad. & El. 106; 3 N. & M. 853; Watters v. Smith, 2 B. & Ad. 889; Beaumont v. Greathead, 2 C. B. 494; Cooper v. Parker, 21 L. J., C. P. 68; 15 C. B. 822. party. XIX. CHAPTER plaintiff, notwithstanding, afterwards sued the defendant for the balance. But Abbott, C.J., said, "If the father did pay the smaller sum in satisfaction of this debt, it is a bar to the plaintiff's now recovering against the son, because, by suing the son, he commits a fraud on the father, whom he induced to advance his money on the faith of such advance being a discharge of his son from further liability" (h). Payment of a smaller sum may be a satisfaction where that smaller sum is the result of an account stated, including cross demands (i). Engagement by third party. a suit. So, although a contract by the defendant himself to pay a smaller sum can be no satisfaction, unless it be negoti able; yet a contract by a third person to do so may be (j). Thus the taking a bill from one of the two partners may operate as a satisfaction of the joint debt for the sole liability of one person may, in some instances, be more advantageous than his liability jointly with another (k). Relinquishing Relinquishing a suit, involving a doubtful point of law, may be a good satisfaction (). So, it should seem, is the relinquishment of a claim involving a reasonable doubt, though really unfounded and without suit (m). When a bill operates as satisfaction. The acceptance of a negotiable security from the debtor alone may be a satisfaction even of a debt of larger amount (n). Where a bill or note, on which some person other than the debtor is liable, is expressly given and accepted (o), in full satisfaction and discharge, the liability of the debtor for the original debt will not revive, on the dishonour of the substituted instrument (p). But if it be taken gene (h) Welby v. Drake, 1 Car. & Payne, 557; Cooper v. Parker, 15 C. B. 822. (i) Smith v. Page, 15 M. & W. 683; Perry v. Atwood, 25 L. J., Q. B. 408; 6 E. & B. 691. (1) Sibree v. Tripp, 15 M. & W. 23; Goddard v. Obrien, 9 Q. B. D. 37. Bidder v. Bridges, 37 Ch. D. 406; 57 L. J. 300. Where plaintiffs kept debtor's cheque for a smaller amount "on account,' held not conclusive as an accord and satisfaction. Day v. Maclea, 22 Q. B. D. 610. (k) Thompson v. Percival, 5 B. & Ad. 925; 3 N. & M. 667; Henderson v. Stobart, 5 Exch. 99 rally on account, or in renewal, the original liability of the CHAPTER debtor revives on its dishonour (q). If, in satisfaction of a XIX. note, a second note be given, and in satisfaction of the second note a third, the third note cannot be pleaded as given in satisfaction of the first (r). The taking of a co-extensive security of a higher nature for a bill or note merges the remedy on the inferior instrument. But it must be strictly co-extensive. Therefore, a specialty given by one maker of a joint and several note does not merge the remedy on the note (s). A warrant of attorney is not an extinguishment of the EXTINGUISHI, debt, as between the parties. "Till judgment is entered MENT OR up," says Lord Ellenborough, "the warrant of attorney is merely a collateral security, and cannot merge the original debt" (t). MERGER. Effect of war rant of attorney. A bill indorsed in blank to one of several acceptors, and Of transfer to in his hands when due, cannot be afterwards transferred (u), an acceptor, so as to confer on the transferee a remedy against any of the acceptors; for there has been that which is an equiva lent to the performance of the contract. Judgment recovered on a bill or note is an extinguish- Cf judgment ment of the original debt, as between the plaintiff and the defendant. But it alone, without actual satisfaction, is no extinguishment, as between the plaintiff and other parties not jointly liable with the original defendant, whether those parties be prior or subsequent to the defendant (x). Nor is it an extinguishment, as between a party prior to the plaintiff, to whom the plaintiff after the judgment returns the bill, and the defendant (y). But a judgment recovered against one of several joint makers or joint acceptors, though without satisfaction, is a good defence to an action against the others (z). But a (a) See post, Steadman v. Gooch, 1 Esp. 3; Kearslake v. Morgan, 5 T. R. 513. (r) David v. Preece, 5 Q B. 440. (s) Ansell v. Baker, 15 Q. B. 30. Quære, as to the effect when the note is joint only. See Bell v. Banks, 3 M. & G. 258, 267; King v. Hoare, 13 M. & W. 494, 496; Sharp v. Gibbs, Scott, N. R. See ante, Chapter on ACCEPTANCE (t) Norris v. Aylett, 2 Can p. 329; Bell v. Banks, 3 M. & G. 258. (u) Steele v. Harmer, 15 L. J., Exch. 217; 14 M. & W. 831; As to this, see the judgment of the Court of Error, 19 L. J., Exch. 37; 4 Exch. 1; Code, s. 61. (x) Bayley, 335; Claxton v. Swift, 2 Show. 441, 494; Lutwyche, 882; Skin. 255, (y) Tarleton v. Allhusen, 2 Ad, & E. 32. (z) Cambefort v. Chapman, 19 Q. B. D. 229; 56 L. J. 639 |