Brownell, Keilmeier & Co. v. Harsh

Welch, C. J. The ground taken in support of the judgments below is, that the contract between Harsh, Cline, and the plaintiffs did not bind Harsh, as between him and the plaintiffs, for the want of any sufficient consideration. It is claimed that the contract was what is called a “ novation,” and that in order to make it binding upon Harsh, it should have provided for the release of Cline from liability, and the relinquishment of the mortgage lien; that without such relinquishment, it was a mere voluntary agreement by Harsh to pay the debt of Cline, without consideration. [633] We wholly dissent from this view of the ease. As we understand it, this was an agreement to the effect that if the plaintiff's would forbear proceedings against the prop■erty, and let Harsh and Cline'enjoy the rents and profits for two years, they would pay the debt. The agreement to forbear was a sufficient consideration. As between Harsh .and the plaintiff's, it was, in substance, an agreement that Harsh would take the risk of the sufficiency of the property to pay the debt, if the plaintiff's would delay proceedings for two years, or until default should be made in the stipulated payments. It was equivalent, in legal effect, to a sale of the mortgage claim to Harsh for its face, payable in in.stallments, and the subrogation of Harsh to the plaintiffs’ right of lien, on the terms named. The stipulation that the lien should continue in no'way affects the case. That "provision was made merely for the purpose of securing the ■claim, and was as much for the benefit of Harsh as of the plaintiffs. An agreement by a creditor to stay legal proceedings against his debtor is surely a sufficient consideration to support a promise by a third person to pay the debt; .and in order to make the promise binding, it is surely not necessary that the creditor should discharge the debtor, or -relinquish his securities and liens. Judgments reversed.