This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
In some jurisdictions it is said that the consideration for the original contract is imported into the new contract, and that accordingly the new contract does not need any consideration.1 In many of these cases this statement is made with reference to contracts in which a sufficient consideration exists for the new contract, if the original contract was valid,2 as where the original contract is executory in part and by the new contract each party is restored to his original position.3 A similar statement has also been made where a contract was entered into to sell stock under a warranty as to the liabilities of the corporation by a subsequent contract, and a certified list of accounts was furnished together with representations that no further liabilities existed.4 A agreed to sell to B a part of an interest in A's ship, in part for cash and in part on deferred payments. The ship was subsequently destroyed. A and B thereupon agreed that B would aid A in prosecuting action to recover damages for the loss of such vessel, and that A would pay to B the amount which B had paid for his interest in such vessel. It was held that such modification of the original contract was valid. It was said "to be well settled that the parties to a contract may by mutual agreement vary or modify its terms or rescind it without any new consideration therefor. In the case of a modification or change of a contract the consideration for the original agreement is imported into the new agreement which is substituted for it." It was pointed out, however, that there was a consideration in the release of each party from the obligation of the original agreemerit.5 In other jurisdictions, however, this from of statement seems to be taken literally, and it seems to be held that if the original contract possesses sufficient consideration, no consideration for the new contract is necessary.6 Under a written contract by which A agrees to cut and bank a certain quantity of logs at a certain price per thousand feet, and also "to break the rollways in the spring," in consideration of which B promises to pay the specified price per thousand, B may discharge A from an obligation to break the rollways in the spring without a new consideration.7 A agreed to pay a commission to B in consideration of B's securing a purchaser for A's land for one thousand, six hundred dollars in cash. Before B had secured such a purchaser A agreed orally to pay such commission if B would secure a purchaser for six hundred dollars cash, and the balance on deferred payments secured by a mortgage. B secured a purchaser upon the terms specified in the oral modification. It was held that such oral modification was valid and that B was entitled to recover his commission.8 A written contract by which A agrees to take a copy of a biographical dictionary from B, and to pay B a certain price therefor, may be modified subsequently by an oral agreement without any new consideration to the effect that the biographical sketch of A is to be submitted to A by B, and that it is not to be published unless A approves it9. If a contract by which a county agrees to convey school lands has not been performed by a conveyance of such lands, and if the purchaser has not performed further than by giving his obligation therefor, it is held that such contract may be modified by reducing the rate of interest upon the deferred installments of the purchase price.10
1 Rumely v. Emmons, 8.) Mich. 511, 48 N. W. 636; Weed v. Spears, 193 X. Y. 289, 86 N. E. 10.
2 Titus v. Whiteside, 228 Fed. 965; George v. Lane, 80 Kan. 94, 102 Pac. 55; Tacoma & Eastern Lumber Co. v. Field, 100 Wash. 79, 170 Pac. 360.
3 Tacoma & Eastern Lumber Co. v. Field, 100 Wash. 79, 170 Pac. 360.
4 Rumely v. Emmons, 85 Mich. 511, 48 N. W. 636.
5See Sec. 601.
6 See Sec. 541 and 604.
7 Seo $ 603.
1 England. Stead v. Dawber, 10 Ad. & El. 57, 52 Wis. 205.
United States. Harrison v. Tampa, 247 Fed. 569.
Atohama. Warren v. Cash, 143 Ala. 156, 39 So. 124; Wellden v. Witt, 145 Ala. 605, 40 So. 126. See, however, that additional consideration is necessary. Shriner v. Craft, 166 Ala. 146, 139 Am St. Rep. 19, 28 L. R. A. (N.S.) 450, 51 So. 884.
Massachusetts. Thomas v. Barnes, 156 Mass. 581, 31 N. E. 683.
Michigan. Pulpwood Co. v. Perry, 158 Mich. 272, 122 N. W. 552.
Texas. Delta County v. Blackburn, 100 Tex. 51, 90 S. W. 902 [judgment reversed, Delta County v. Blackburn, 93 S. W. 419].
Washington. Pacific Power & Light Co. v. White, 104 Wash. 528, 177 Pac. 313.
Wisconsin. Brown v. Everhard. 52 Wis. 205, 8 N. W. 725; Magill v. Stoddard, 70 Wis. 75, 35 N. W. 346; Ruege v. Gates, 71 Wis. 634, 38 N. W. 181.
"The same consideration which existed for the old agreement re imported into the new agreement which is substituted for it." Stead v. Dawber, 10 Ad. & El. 57 [quoted in Brown v. Everhard, 52 Wis. 205], 8 N. W. 725; Kelly v. Bliss, 54 Wis. 187, 11 N. W. 488.
2 Wellden v. Witt, 145 Ala. 605, 40 So. 126; Pacific Power & Light Co. v. White, 06 Wash. 18, Ann. Cos. 1919B, 125, 164 Pac. 602; Pacific Power & Light Co. v. White, 104 Wash. 528, 177 Pac. 313.
3 Wellden v. Witt, 145 Ala. 605, 40 So. 126.
4 Pacific Power & Light Co. v. White. 96 Wash. 18. Ann. Cas. 1918B. 125, 164 Pac. 602; Pacific Power & Light Co. v. White, 104 Wash. 528, 177 Pac. 313.