Cutter v. Cochrane

Ames, J. Whether by her failure to make the stipulated payments the plaintiff had lost all hei rights under the original con [410] tract, and forfeited the money which she had paid, is a question which the defendant is not entitled to raise in this case. The settlement which was had between the parties proceeded upon a very different ground. An agreement to rescind a previous contract imports that, until it is rescinded, it is recognized by both parties as subsisting and binding. The rescinding of a previous contract containing "mutual stipulations is a release by each party to the other. The release by one is the consideration for the release by the other, and the mutual releases form the consideration for the new promise, and are sufficient to give it full legal effect. The defendant is bound to account for the money that has been paid to him, not because the purchase did not go into effect, but because, in consideration of mutual releases, he has excused the plaintiff from its fulfilment, has consented to a new agreement, and has expressly promised to account for the money. ."Exceptions sustained.