Foakes v Beer
Payment of a smaller sum does not discharge a debt for a larger sum.
Facts
Mrs Beer obtained a judgment against Dr Foakes for £2,090 19s. Judgment debts carried interest by statute. The parties then made a written agreement that, if Dr Foakes paid £500 at once and the rest by half yearly instalments of £150, Mrs Beer would not take any proceedings on the judgment. Dr Foakes paid the full £2,090 19s in instalments. Mrs Beer then claimed the interest that had accrued on the judgment debt in the meantime, and Dr Foakes argued that the agreement released him from it.
Legal principle
The House of Lords held that Mrs Beer was entitled to the interest. Following the rule in Pinnel's Case (1602), payment of a lesser sum on the day it is due cannot satisfy a debt for a greater sum, because the debtor gives no consideration for the creditor's promise to forgo the balance. The agreement did not provide for the interest, and even if it had been intended to release Dr Foakes from it, Mrs Beer's promise was unsupported by consideration. Lord Blackburn doubted the rule, noting that creditors often find it to their practical benefit to accept prompt part payment, but the House felt bound by long established authority.
Related cases on consideration and promissory estoppel
- Central London Property Trust Ltd v High Trees House Ltd [1947] KB 130
- Chappell & Co Ltd v Nestlé Co Ltd [1960] AC 87
- Collier v P & MJ Wright (Holdings) Ltd [2007] EWCA Civ 1329, [2008] 1 WLR 643
- Combe v Combe [1951] 2 KB 215
- Currie v Misa (1875) LR 10 Ex 153
- D & C Builders Ltd v Rees [1966] 2 QB 617
- Glasbrook Bros Ltd v Glamorgan County Council [1925] AC 270
- Hartley v Ponsonby (1857) 7 E & B 872
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