Martin v. Frantz

Opinion, Mr. Justice Mitchell : It is too well settled to admit of discussion that an agreement to accept a smaller sum in satisfaction of a larger one, presently due, is without consideration and cannot be enforced; Brockley v. Brockley, 122 Pa. 1 ; and the actual acceptance of such smaller sum is not a good discharge of the debt, even as accord and satisfaction: Mechanics Bank v. Huston, 11 W. N. 389. It is clear, therefore, that the agreement relied on by the defendant below was without consideration in the way of benefit accruing to the plaintiff, and it must fail as a defence unless it imposed some burden or disadvantage on the defendant. All that is claimed for it in this regard is, that it allowed the statute of limitations to run in favor of the co-surety, B. U. Charles, and thus deprived defendant of his right to contribution. The authorities, however, are quite uniform that this result does not follow. “ The right of action for contribution does not arise until payment of more than a due proportion, and hence the statute of limitations does not begin to run until then: ” De Colyar on Guaranties, 354, Morgan’s Am. ed.; and see Parsons on Contracts, pp. 33-37, and cases there cited. The precise point involved here has been expressly decided by several courts of the highest authority. Thus in Peaslee v. Breed, 10 N. H. 4-89, one of two joint makers of a note was protected against the holder, by the statute of limitations, while the other, through payments made by himself, remained liable. The latter having paid, was held entitled to recover of the former his share for contribution, Parker, C. J., saying, “ We are of opinion that the plaintiff is entitled to recover for the amount paid after the period when no action could have been sustained directly against the defendant by the payee of the note.” In Boardman v. Paige, 11 N. H. 438, the rule is thus stated: “ When one promisor still continues liable.....and is compelled to pay.....the liability of the co-promisors for con [396] tribution will still remain, notwithstanding.....they may be discharged by the operation of the statute of limitations, from their liability to the promisee.” In Wood v. Leland, 1 Metc. (Mass.) 387, it was said by Chief Justice Shaw, “ Defendants contend that as they could not be held responsible to the obligee after the year, so they would not be liable for contribution to a surety after that time. But the court are of opinion that the statute of limitations cannot be so applied. It may well be admitted that the statute of limitations would be a good bar to an action by the obligee;.....but the right of action by the surety for contribution does not accrue at the breach of the bond, but upon his payment of the money pursuant to that breach.” And in Camp v. Bostwick, 20 Ohio St. 347, it was held that the right to contribution does not arise directly from the original instrument of joint obligation, but from the equity of one who has borne more than his just share of a joint burden, and “ this equity having once arisen between co-sureties,” says McIlvaxnb, J., “ neither the creditor, the principal, the statute of limitations, nor the death of a party can take it away.” It is thus clear on the authorities that whatever rights of contribution plaintiff in error may have, arise out of his payment of more than his due proportion of the joint obligation, and will date from such payment, entirely unaffected by the fact that the statute of limitations has barred any direct liability of his co-surety 'to the creditor. The agreement relied on being therefore without consideration, either by way of advantage to the plaintiff or disadvantage to the defendant, was not a valid defence, and the learned judge was right in directing a verdict for plaintiff. Judgment affirmed.