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 effect of a new unsealed contract upon liabilities arising out of a sealed contract depends in part on the stage in the historical development of the law at which the effect is to be determined, in part on whether the case is decided in law or in equity, in part on whether the new contract is executory or is performed, in part oh whether the new contract was made before breach of the original contract under seal, or after breach thereof, and in part on whether, in the jurisdiction in which the question arises, the seal has its original common-law effect, or whether the simplification of the law has reduced the sealed instrument to a position but little, if any, above that of the written simple contract.1
At common law, if the original contract was under seal, it could not, before breach, be modified by a subsequent executory agreement not under seal.2 This view has been entertained in some jurisdictions in the United States.3 Even if the obligee redelivered the bond to the obligor. under an oral agreement for the discharge thereof, such contract was held to have no legal effect;4 and if the obligee later took such bond from the obligor by force before it had been canceled or defaced, and brought action thereon, such facts would not be a defense at law.5
8 German Bank v. Iron Works (la.) 99 N. W. 174.
9 Farmers' Bank v. Groves, 53 U. S. (12 How.) 61, 13 L. ed. 889; Ex parte Zeigter, 83 S. Car. 78, 21 L. R. A. (N.S.) 1005, 64 S, E. 513, 916.
1See Sec. 1156.
2Countess of Rutland's Case, 5 Coke 25b; Rogers v. Payne, 2 Wils. 376; West v. Blakeway, 2 M. & G. 729; Ellen v. Topp, 6 Exch. 424; Spence v. Healey, 8 Exch. 668.
See Sec. 1172.
3 Arkansas. Miller M. Hemphill, 9
Connecticut. Smith v. Lewis. 24 Conn. 624, 63 Am. Dec. 180.
Florida. Tischlor v. Kurtz, 3.1 Flu. 323, 17 So. 661.
Illinois. Loach v. Farnum, 90 111.
368; Goldesborough v. Gable, 140 111. 269, 15 L. R. A. 294, 29 N. E. 722 (also want of consideration); West Chicago Street Ry. v. Morrison, etc., Co., 160 111. 288, 43 N. E. 393; Snow v. Gries-heimer, 220 111. 106, 77 X. E. 110 (obiter, us new contract had been performed); Jones & Dommersnae Co. v. Crary, 234 111. 26, 84 X. E. 651 (obiter, as new contract had been performed); Jones v. Chamberlain, 97 111. App. 328.
Kentucky. Kendal v. Talbot, 8 Ky. (1 A. K. Mar.) 321.
Maine. Brown v. Staples, 28 Me. 497, 48 Am. Dec. 504.
New York. French v. New, 28 N. Y. 147.
Vermont. Sherwin v. Salpaugh & Rut. & Bur. R. R. Co., 24 Vt. 347.
4 Waberly v. Cockerel, 1 Dyer 51a.
Such a contract may be discharged by a subsequent contract not under seal which has been fully performed.6 If the subsequent contract not under seal has been so far carried out that the parties can not be restored to their position before entering into it, the original contract under seal is thereby abrogated or modified.7
After breach of a sealed contract, the right of action arising out of such breach could be discharged by a subsequent oral agreement,8 subject to the same restrictions as in the case of a simple contract.