Davis v. Stout

• Decision Date: 13 November 1890
• Citation: 126 Ind. 12,25 N.E. 862
• Parties: Davis et al. v. Stout.
• Court: Indiana Supreme Court

126 Ind. 12

25 N.E. 862

Davis et al.

v.Stout.

Supreme Court of Indiana.

Nov. 13, 1890.

Appeal from circuit court, Bartholomew county; N. R. Keyes, Judge.

Hord & Emig, for appellants. Hacker & Remy, for appellee.

Elliott, J.

The promissory note upon which the appellee's complaint is founded was executed by Jacob Davis as principal, and by Eliza J. Davis as surety. It was executed in April, 1878, and became due May 4, 1878. The principal debtor sets forth in his answer this contract with the payee: “Nov. 29th, 1886. In consideration of the payment of three hundred dollars, the receipt of which is hereby acknowledged, and three hundred on or before May the first, 1887, and $300 Aug. 1st, 1887, and balance on or before Dec. 25th, 1887, and to avoid litigation and other considerations, the time on note held against Jacob Davis and Eliza J. Davis is to be extended to the above-stipulated time, and suit now pending in Bartholomew circuit court dismissed. Abner Stout.” Counsel argue that this contract evidences a reloan of the money to Jacob Davis, and that it merges the original note so that no action can be maintained upon it. This contention cannot prevail. The words of the instrument are that “the time on the note held against Jacob Davis and Eliza J. Davis is to be extended to the above-stipulated time,” and there can be no doubt as to their meaning and effect. They do not extinguish the note. On the contrary, they expressly continue it in force, and provide for an extension of the time of payment. If, therefore, it should be granted that the contract extending the time of payment is effective, still, the note itself is not extinguished. The contract is not valid for the reason that it is without consideration. It does not belong to the class of contracts in which a consideration is implied, nor do the recitals show a consideration; neither is there any extrinsic averment showing a valid consideration for the agreement of forbearance. The principal and interest of the note were due when the payments were made, and the agreement extending the time of payment entered into; hence it is plain that the payors of the note neither did anything they were not already under a binding legal obligation to do nor undertook to do anything that they were not already bound to perform. Harris v. Cassady, 107 Ind. 158, 8 N. E. Rep. 29; Laboyteaux v. Swigart, 103 Ind. 596, 3 N. E. Rep. 373; Fensler v. Prather, 43 Ind. 119;Ritenour v. Mathews, 42 Ind. 7;Reynolds v. Nugent, 25 Ind. 328. It does not appear, either in the recitals of the contract or by extrinsic averments, that the payors of the note had any defense; but, for aught that is alleged, their claim was utterly groundless, and it is well settled that a foundationless claim will not support an agreement of compromise. Harris v. Cassady, supra, and cases cited; Smith v. Boruff, 75 Ind. 412. An agreement of compromise or of forbearance requires a consideration. Holmes v. Boyd, 90 Ind. 332;Henry v. Gilliland, 103 Ind. 182, 2 N. E. Rep. 360; Roberts v. Richardson, 39 Iowa, 290; Costello v. Wilhelm, 13 Kan. 229; Dillon v. Russell, 5 Neb. 484. What we have said fully disposes of the...