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.
The formality with which a new contract modifying or abrogating an earlier contract must be executed, or the kind of evidence by which it must be proved, depends in part upon the formality with which the original contract is executed, or the evidence whereby it must be proved. At common law. obligations were divided into classes with reference to their rank. Judgments and contracts of record were of higher rank than contracts under seal, and contracts under seal were of higher rank than simple contracts. There was, however, no difference in rank between written contracts not under seal and oral contracts. It was a fundamental theory of the common law that no obligation could be modified or discharged by a subsequent voluntary agreement or by a subsequent obligation of any kind, unless the new obligation were of as high rank as the original obligation.1 While the modern courts which follow this rule are likely to do so in an apologetic fashion, relying upon absolute authority, and conceding that the rule has no vital principle back of it,2 the common-law courts did not originally take this position, but they regarded this rule as based upon natural justice, and they declared boldly that it was in accordance with natural law that an obligation could be discharged only by an obligation of at least as high a rank as that whereby it was formed originally.3
At common law it was said that a contract of record could not be discharged except by record.4 Even payment was not a discharge unless it was entered of record.5 Accord and satisfaction was not a discharge.6 A judgment can not be discharged by a simple executory contract.7
17 Northern Assurance Co. v. Building Association, 183 U. S. 308, 46 L. ed. 213.
1 Kromer v. Heim, 75 N. Y. 574, 31 Am. Rep. 491.
2Spence v. Healey, 8 Exch. 668; Mc-Creery v. Day, 119 N. Y. 1, 16 Am 6t. Rep. 793, 6 L. R. A. 503, 23 N. E. 198 (obiter).
This principle is said to be "so well established that it appears to me unnecessary to refer to cases." West v Blakeway, 2 Man. & G. 729.
3 Blake's Case, 6 Coke 43b.
4 Mitchell v. Hawley, 4 Denio (N. Y.) 414, 47 Am. Dec. 260.
5 See discussion of original rule in Briley v. Sugg, 21 N. Car. 366, 30 Am. Dec. 172.
See also Boffinger v. Tuyes, 120 U. S. 198, 30 L. ed. 649.
6 Lutterford v. Le Mayre, Cro. Jac. 579; Weber v. Couch, 134 Mass. 26, 45 Am. Rep. 274; Mitchell v. Hawley, 4 Denio (N. Y.) 414, 47 Am. Dec. 260.
7 Kromer v. Heim, 75 N. Y. 574, 31 Am. Rep. 491 (a case of unexecuted accord).
At modern law, a contract of record, such as a judgment, may be discharged by a subsequent contract taken in satisfaction thereof.8 Accord and satisfaction of a judgment is a discharge thereof.9