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.
10 Union Mutual Life Ins. Co. v. Union Mills Plaster Co., 37 Fed. 286, 3 IL. R. A. 90. (Tender was refused because the mortgagee insisted that the mortgagor improve the mortgaged property.) Slesinger v. Bresler, 110 Mich. 198, 68 N. W. 128. (Tender of notes agreed to be taken as payment refused because the creditor had changed his mind.)
11 People's Furniture & Carpet Co. v. Crosby, 57 Neb. 282, 73 Am. St. Rep. 604, 77 N. W. 658.
12 Christenson v. Nelson, 38 Or. 473, 63 Pac. 648.
11 Northern Colorado Irrigation Co. v. Richard.4. 22 Colo. 450, 45 Pac. 423.
14 McWhirter v. Crawford, 104 la. 550, 72 N. W. 505 [modified on rehearing, 73 N. W. 1021].
15 Latimer v. Capay Valley Land Co., 137 Cal. 286, 70 Pac. 82 (as that interest is not included).
16 Kofoed v. Cordon, 122 Cal. 314, 54 Pac. 1115.
17 Colton v. Oakland Bank of Savings, 137 Cal. 376, 70 Pac. 225.
18 Bluntzer v. Dewees, 79 Tex. 272.
19 Martin v. Bank, 131 N. Car. 121, 42 S. E. 558.
If tender is refused, the question whether the contract is discharged or not depends on whether the contract requires payment in money or other performance. If the contract provides for performance other than payment in money, a refusal of tender operates as a discharge,2 on the theory that such tender transfers the title to the party to whom tender was made, if it was in due form and in accordance with the terms of the contract. If the contract provides for payment in money, refusal of tender does not discharge the contract as far as the liability of the principal debtor is concerned,3 though it stops interest4 and costs,5 provided the tender is kept good. A tender which is kept good by payment into court, relieves the debtor from liability for the plaintiff's attorn-ney's fees as costs, even if such tender was defective as being conditional, if the real litigation was on another issue.6 If the debtor makes a valid tender of money through his agent, which is refused, and such agent thereafter becomes bankrupt, the loss of the principal and interest down to the date of tender is that of the debtor.7 Accordingly, a verdict and judgment for the defendant upon a plea of tender of money is wrong.8 It was queried in an early case whether if the creditor refused a valid tender and the coinage was subsequently debased, the debtor must bear such loss.9
1 Root v. Bradley, 49 Mich. 27, 12 N. W. 89G; Moore v. Norman, 43 Minn. 428, 19 Am. St. Rep. 247, 9 L. R. A. 55, 45 N. W. 857.
2 Indiana. Mitchell v. Merrill, 2 Blackf. (Ind.) 87, 18 Am. Dec. 128.
Iowa. Long v. Wilson, 80 la. 216, 45 N. W. 764.
Maine. Wyman v. Winslow, 11 Mc. 398, 26 Am. Dec. 542.
New York. Shannon v. Comstock, 21 Wend. (N. Y.) 457, 34 Am. Dec. 262.
South Dakota. Dowagiac Mfg. Co. v. Higinbotham, 15 S. D. 547, 91 N. W. 330.
Vermont. Barney v. BIiss, 1 1). Chip. (Vt.) 399, 12 Am. Deo. 696.
3 England. Dent v. Dunn, 3 Camp. 296.
Iowa, Mohn v. Stoner, 11 la. 30.
Massachusetts. Suffolk Bank v. The Worcester Bank, 22 Mass. (5 Pick.) 106.
Michigan. Snyder v. Quarton, 47 Mich. 211, 10 N. W. 204.
New Hampshire. Stowell v. Read, 16 N. H. 20, 41 Am. Dec. 714.
Oklahoma. Loth-Hoffman Clothing Co. v. Schwartz, - Okla. - , 176 Par. 916.
Vermont, Preston v. Grant, 34 Vt. 201.
Washington. Hays v. Bashor, - Wash. - , 185 Pac. 814.
4 Dent v. Dunn, 3 Camp. 296; Peugh v. Davis, 113 U. S. 542, 28 L. ed. 1127; Cheney v. Libbey, 134 U. S. 68, 33 L. ed. 818; Tuthill v. Morris, 81 N. Y. 94; Bailey v. Buchanan County, 115 N. Y. 297, 6 L. R. A. 562, 22 N. E. 155; Parker v. Beasley, 116 N. Car. 1, 33 L. R. A. 231, 21 S. E. 955.
5 MeCalley v. Otey, 99 Ala. 584, 42 Am. St. Rep. 87, 12 So. 406; Wing v. Blocker, 115 Ga. 778, 42 S. E. 67; Saunders v. King, 119 la. 291. 93 N. W. 272; Fuller v. Pelton, 16 Ohio 457; Cohoon v. Kineon, 46 O. S. 590, 22 N. E. 722.
To discharge interest, however, the tender must be kept good.10 If the tender is not kept good, and the debtor makes use of the money tendered by him, after tender is refused, he is liable for interest.11 Since a tender of less than the full amount is insufficient in law, it does not prevent recovery of costs in a subsequent action.12 A surety is discharged by refusal of tender made by him with the demand that the debt be assigned to him.13