§ 1354. Another defence is Accord and Satisfaction. An accord is an agreement between two parties to substitute some equivalent in satisfaction of a claim due from one to the other.1 It must be advantageous to the party accepting it;2 it must be in full satisfaction of the thing demanded; 3 it must be certain, and it must be perfectly executed.4 And in order to make a payment of a less sum than is really due operate as an accord and satisfaction, there must be mutual demands.1 If, therefore, the accord be originally of nothing beneficial, or if, although originally beneficial, it be afterwards rendered worthless by the act or omission of the party giving it, it would be insufficient.2 So, also, the acceptance of a part of a liquidated and undisputed debt would not suffice even though a receipt be given in full of the whole sum,3 unless some peculiar benefit be received, operating as an additional consideration,4 in which case it would be;5 as if part be paid before the whole is due,6 or if payment be made at a more convenient place,7 or if a third person give his note for the sum due.8 But if the claim be not liquidated, but open to dispute, a receipt in full could be pleaded as an accord with satisfaction, on the ground that a fair compromise and settlement of a claim should be upheld.9 But if goods or chattels or services be received10 in full payment of a debt, it is a sufficient accord and satisfaction, although the goods or services are not of the value of the debt,1 provided their value be not agreed upon.2 An accord or agreement to do a certain act which is done is an accord with satisfaction, and is a good defence in an action of assumpsit.3 Therefore, if the accord be to pay money in satisfaction, it will not operate as a defence until payment is actually made; and proof of readiness to pay, or even of a tender and refusal, is not sufficient.4 For a mere agreement to do a future act is only an accord, which is no defence.5 An accord executed before a breach of the contract to which it is pleaded as a defence is not valid.6 Where, however, there are mutual promises to perform, the accord is good, though the thing be not performed at the time of action; for the party has a remedy to compel the performance.7 But the remedy ought to be such that the party might have taken it upon the mutual promise at the time of the agreement.8
1 Bacon, Abr. Accord. See McKellar v. Wallace, 8 Moore, P. C. 378.
2 Keeler v. Neal, 2 Watts, 424; Davis v. Noaks, 3 J. J. Marsh. 497; Turner v. Browne, 3 C. B. 157; Hall v. Sraallwood, Peake's Add. Cas. 13; Logan v. Austin, 1 Stew. 476.
3 Warren p. Skinner, 20 Conn. 559; Worthington v. Wigley, 3 Bing. N. C. 454; Mitchell v. Cragg, 10 M. & W. 367; Greenwood v. Lidbetter, 12 Price, 183; Smith v. Bartholomew, 1 Met. 276; White v. Jordan, 27 Me. 370; Bruce v. Bruce, 4 Dana, 530. But it is immaterial whether the debt be past due or running to maturity. Wescott v. Waller, 47 Ala-492 (1872).
4 Com. Dig. Accord, B. 1, 3, 4; Bacon, Abr. Accord, A; Cuxon v. Chadley, 3 B. & C. 591; 5 D. & R. 417. See Cushing v. Wyman, 44 Me. 121; Bragg v. Pierce, 53 Me. 65. The plaintiff agreed with the defendant to take his pay, for work he had already done for the defendant, in wood, then lying on the defendant's land. On demand, the defendant declined to point out to the plaintiff what wood to take, but told him to take enough to satisfy himself. Held, that the agreement was no bar to an action for the price of the work. Costello v. Cady, 102 Mass. 140 (1869). Where a controversy has been adjusted by the parties to it by an offset, mutually agreed upon, of the claims which each sets up against the other, and there is a reciprocal agreement not to sue on either side, courts should give effect to the agreement, unless the case shows bad faith in the assertion of any claim at all on the part of one of the parties, or that the claim is so destitute of foundation as to savor of imposition and extortion. Doyle v. Donnelly, 56 Me. 27 (1868).
1 Perry v. Attwood, 6 El. & B. 691; 37 Eng. Law & Eq. 24; and see Page v. Smith, 15 M. & W. 683.
2 Turner v. Browne, 3 C. B. 157; Hall v. Smallwood, Peake's Add. Cas. 13; Preston v. Christmas, 2 Wilson, 86.
3 Warren v. Skinner, 20 Conn. 559; Harriman v. Harriman, 12 Gray, 341 (1859).
4 Douglass v. White, 3 Barb. Ch. 621; Hinckley v. Arey, 27 Me. 362; Milliken v. Brown, 1 Rawle, 391; Sibree v. Tripp, 15 M. & W. 23; Wat-kinson v. Inglesby, 5 Johns. 386. See Clifton v. Litchfield, 106Mass. 34 (1870).
5 Drogheda v. Fairtlough, 8 Irish Com. Rep. 98 (1858).
6 Pinnel's Case, 5 Rep. 117; Brooks v. White, 2 Met. 283; Smith v. Brown, 3 Hawkes, 580; Goodnow v. Smith, 18 Pick. 414; Rose v. Hall, 26 Conn. 392.
7 Smith v. Brown, 3 Hawkes, 580. See ante, § 1342.
8 Brooks v. White, 2 Met. 283; Boyd v. Hitchcock, 20 Johns. 76; Steinman v. Magnus, 11 East, 390; Lewis v. Jones, 4 B. & C. 506; Kellogg v. Richards, 14 Wend. 116; Bliss v. Swartz, 7 Lans. 186 (1872).
9 Longridge v. Dorville, 5 B. & Ald. 117; Wilkinson v. Byers, 1 Ad. & El. 106; Reynolds v. Pinhowe, Cro. Eliz. 429; Palmerton v. Huxford, 4 Denio, 166; Tuttle v. Tuttle, 12 Met. 551; Atlee v. Backhouse, 3M.& W. 651; Stockton v. Frey, 4 Gill, 406; Howard v. Norton, 65 Barb. 161 (1873).
10 See Deweese v. Cheek, 35 Ind. 514 (1871).
§ 1355. In some cases, however, the accord might operate as an absolute extinguishment of the original contract by way of substitution or novation, or as a conditional extinguishment of the debt so far as the action thereon is concerned. Thus, if a settlement be made of the old contract by a new arrangement varying it in form, and agreed to be substituted therefor upon a sufficient consideration, the plea of this accord would be a sufficient answer to an action on the original contract.1 But in such cases it must clearly appear that the substituted agreement was intended to operate as an extinguishment of the debt,2 and the plea should so aver. Again, where a new promise, conditional in its terms, is substituted for the original obligation and accepted as full satisfaction on condition of its performance at a fixed day, it would be a good answer to an action on the original claim, until the conditional and substituted contract was broken by non-performance at the time fixed. Thus, if a promissory note or bill of exchange should be given and accepted as a settlement 3 of a debt, it would operate as a temporary suspension of the right to sue on the original contract. But upon failure to pay the note or bill when due, the right to sue on the original contract would revive.4 In such cases, however, the question depends on the intention of the parties as manifested by the exact circumstances of each case.1 If it appear that a promissory note is accepted as an unconditional and full settlement of a debt,2 or