20 Thornhill v. Neats, 8 C. B. (N. S.) 831. And see Cornish v. Suydam, 99 Ala. 620, 13 South. 118; Stewart v. Keteltas, 36 N. Y. 3S8; Underwood v. Wolf, 131 111. 425, 23 N. E. 59S, 19 Am. St. Rep. 40; Howard v. Railroad Co., 1 Gill (Md.) 311; Huckestein v. Kelly, 152 Pa. 631, 25 Atl. 747. See "Contracts," Dec. Dig. (Key-So.) § 21,5; Cent. Dig. §§ 1129, 1180.

21 Millsaps v. Bank, 71 Miss. 361, 13 South. 903; Uhlig v. Barnum, 43 Neb.

Again, a contract may be discharged by the introduction of new parties into the original agreement, whereby a new contract is created, in which the terms remain the same, but the parties" are different. This is termed a "novation." We have already spoken of it as an apparent exception to the rule that the rights and liabilities under a contract cannot be assigned at law.25 Such a substitution may be made (1) by express agreement, or (2) by conduct of the parties indicating acquiescence in a change of liability. If, for instance, A. owes B. $100, and B. owes C. $100. it may be agreed between all three that A. shall pay C. instead of paying B., so that B. thereby terminates his legal relations with both A. and C.26The consideration for A.'s promise to pay C. is the discharge of B. by C.; the consideration of B.'s discharge of A. is the extinguishment of his debt to C.; and the consideration of C.'s discharge of B. is the promise of A. It would not be enough for A. to say to C, "I will pay you instead of B.," and to afterwards suggest the arrangement to B. and receive his assent;27 nor would it be enough for B. to authorize A. in writing to pay to C, and for A. to acknowledge the paper.28 All three must enter into the agreement, and the original liability must be extinguished. This is essential, because it is the promise of each that is the consideration for the promise of the others.29 As we have said, such a substitution and discharge may arise otherwise than by express agreement; it may arise from the conduct of the parties indicating acquiescence in a change of liability. If a person, for instance, enters into a contract with two others, and the latter agree between themselves that one of them shall retire from the contract and cease to be liable upon it, the first-mentioned party may either insist upon the continued liability of the party remaining, or may treat the contract as broken and discharged by such renunciation of his liabilities by the

584, 61 N. W. 749. See "Contracts;' Dec. Dig. (Key-No.) § 245; Cent. Dig. §§ 1129, 1180.

22Hickman v. Haynes, L. R. 10 C. P. 606; Lawson v. Hogan, 93 N. Y. 39; Watkins v. Hodges, 6 Har. & J. (Md.) 38; Franklin Fire Ins. Co. v. Hamill, 5 Md. 170; Bacon v. Cobb, 45 111. 47; McCombs v. McKennan, 2 Watts & S. (Pa.) 216, 37 Am. Dec. 505; Thomson v. Poor, 147 N. Y. 402, 42 N. E. 13. See "Contracts" Dec. Dig. (Key-No.) § 245; Cent. Dig. §§ 1129, 1130.

23Hickman v. Haynes, L. R. 10 C. P. 606. See "Sales," Dec. Dig. (Key-No.) §§ 89, 90; Cent. Dig. §§ 251-258, 259.

24Anson, Cont. (4th Ed.) 261; Ogle v. Earl Vane, L. R. 2 Q. B. 275, L. R. 3 Q. B. 272. See "Sales," Dec. Dig. (Key-No.) §§ 89, 90; Cent. Dig. §§ 251-258, 259.

25Ante, p. 456.

26 Tatlock v. Harris. 3 Term R. 174; Heaton v. Angler, 7 N. H. 397, 28 Am. Dec. 353; Sterling v. Ryan, 72 Wis. 36, 37 N. W. 572, 7 Am. St. Rep. 818; McKinney v. Alvis, 14 111. 33; Litchfield v. Garratt, 10 Mich. 426; Mc-Clellan v. Robe, 93 Ind. 298; Mulgrew v. Cocharen, 96 Mich. 422, 56 N. W. 70; Id., 98 Mich. 532, 57 N. W. 739; Atwood v. Town of Mt. Holly, 65 Vt. 121, 26 Atl. 491; Byrd v. Bertrand, 7 Ark. 321; Foster v. Paine, 63 Iowa, 85, 18 N. W. 699; Gardner v. Caylor, 24 Ind. App. 521, 56 N. E. 134; Minder & Jorgenson Land Co. v. Brustuen, 26 S. D. 38, 127 N. W. 546. See "Novation," Dec. Dig. (Key-No.) § 7; Cent. Dig. § 7.

27 Cuxon v. Chadley, 3 Barn. & C. 591; Barnes v. Insurance Co., 56 Minn. 38, 57 N. W. 314, 45 Am. St. Rep. 438. See "Novation," Dec. Dig. (Key-No.) § 7; Cent. Dig. § 7.

28Liversidge v. Broadbent, 4 Hurl. & N. 603; ante, p. 466. See "Novation," Dec. Dig. (Key-No.) § 7; Cent. Dig. § 7.

29 Liversidge v. Broadbent, 4 Hurl. & N. 603; Cuxon v. Chadley, 3 Barn. & C. 591; Wood v. Moriarty, 16 R. I. 201, 14 Atl. 855; First Nat. Bank v. Hall, 101 U. S. 50, 25 L. Ed. 822; Hard v. Burton, 62 Vt. 314, 20 Atl. 269; Spycher v. Werner, 74 Wis. 456, 43 N. W. 161, 5 L. R. A. 414; McKinney v. Alvis, 14 111. 33; Smith v. Watson. 82 Va. 712, 1 S. E. 96; Black v. De Camp, 78 Iowa, 718, 43 N. W. 625; Bowen v. Railroad Co., 34 S. C. 217, 13 S. E. 421; Ilau-bert v. Mausshardt, 89 Cal. 433, 26 Pac. 899; Morrison v. Kendall, 6 Ind. App. 212, 33 N. E. 370; Linneman v. Moross' Estate, 98 Mich. 178, 57 N. W. 103, 39 Am. St. Rep. 528; Campbell v. Clay, 4 Colo. App. 551, 36 Pac. 909; Butterfield v. Hartshorn, 7 N. H. 345, 26 Am. Dec. 741; Cornwell v. Megins, 39 Minn. 407, 40 N. W. 610; Levy v. Ford, 41 La. Ann. 873, 6 South. 671. Cf. Clough v. Giles, 64 N. H. 73, 5 Atl. 835; Wolters v. Thomas (Cal.) 32 Pac. 563; Casey v. Miller, 3 Idaho (Hasb.) 507, 32 Pac. 195. See "Novatian," Dec. Dig. (Key-No.) § 8; Cent. Dig. § 3; "Contracts," Cent. Dig. § 256.

Clark Cont.(3d Ed.) - 34

party so attempting to withdraw. If, however, under some circumstances, the first-mentioned party, after he becomes aware of the retirement of one of the other parties, continues to deal with the remaining party as though no change has taken place, he acquiesces, and may be considered to have entered into a new contract to accept the sole liability of the party so remaining, and cannot hold the other to his original contract. Cases of this sort arise where a member retires from a partnership, after the firm has entered into a contract, and it is subsequently sought to hold him liable thereon. "I apprehend the law to be now settled," said Parke, B., "that if one partner goes out of a firm, and another comes in, the debts of the old firm may, by the consent of all the three parties - the creditor, the old firm, and the new firm - be transferred to the new firm." 30 Moreover, a retired partner may be discharged by the creditor's adoption of the other partners as his sole debtors, although no new partner has been introduced into the firm.31 An agreement to discharge a retired partner, and look only to a continuing partner, is not inoperative for want of consideration.82 And when the new firm agrees to assume the liabilities of the old, slight circumstances will support an inference of assent on the part of a creditor who had notice of the dissolution to a novation.33

In order that a contract may be discharged in whole or in part by a subsequent agreement the latter must be supported by a consideration.34 Such a consideration may consist, however, in a change of the rights and liabilities of the parties and the consequent extinction of those which before existed.35 On principle, it would seem that, if a person should refuse to perform a contract simply because he would suffer a loss by performing, a promise by the other party to pay him more, or to accept less, than originally agreed upon, to induce him to go on with the contract, would be without consideration. We have already seen that on this question the authorities are not in accord.38

30 Hart v. Alexander, 2 Mees. & W. 484. And see Ludington v. Bell, 77 N. Y. 138, 33 Am. Rep. 601; Filipini v. Stead, 4 Misc. Rep. 405, 23 N. Y. Supp. 1061. Cf. Ayer v. Kilner, 148 Mass. 468, 20 N. E. 163. But see Wad-hanis v. Page, 1 Wash. 420, 25 Pac. 462; Id., 6 Wash. 103, 32 Pac. 1068; Campbell v. Floyd, 153 Pa. 84, 25 Atl. 1033. Where a creditor of a partnership, after dissolution, accepts the note of some of the partners in payment of the firm debt, intending that it shall satisfy the original obligation, the other partner is discharged. Waydell v. Luer, 3 Denio (N. Y.) 410; Millerd v. Thorn, 56 N. Y. 402; Ludington v. Bell, supra; Powell v. Blow, 34 Mo. 485; Stone v. Chamberlin, 20 Ga. 259; Maxwell v. Day, 45 Ind. 509. But not if there is no such intention. Post. p. 547. note 2. See "Partnership" Dec. Dig. (Key-No.) §§ 236-238; Cent. Dig. §§ 481,-491.

31 York v. Orton, 65 Wis. 6, 26 N. W. 166. See "Partnership," Dec. Dig. (Key-No.) § 236; Cent. Dig. §§ 484-486.

32Thompson v. Percival, 5 Barn. & Ad. 925; Backus v. Fobes, 20 N. Y. 204; Collyer v. Moulton, 9 R. I. 90, 98 Am. Dec. 370. See "Partnership," Dec. Dig. (Key-No.) § 236; Cent. Dig. §§ 484-486.

33Regester v. Dodge (C. C.) 6 Fed. 6; Shaw v. McGregory, 105 Mass. 96; Tysen v. Somerville. 35 Fla. 219, 17 South. 567. See "Partnership," Dec. Dig. (Key-No.) § 239; Cent. Dig. §§ 487-499.

34 Whitsett v. Carney (Tex. Civ. App.) 124 S. W. 443. See "Contracts," Dec. Dig. (Key-No.) § 237; Cent. Dig. §§ 1119-1122.