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Foakes v Beer, [1884] UKHL 1


In a previous judgment, D recovered from P. P promised to pay installments over 5 years. D promised to not take any proceedings, which meant D could not claim interest. D now wants interest.


Was the agreement to accept less than the whole debt legally binding?


An agreement to accept less than you are owed is not binding unless there is some consideration.
**A payment of a lesser sum in satisfaction of a larger amount does not constitute consideration
***Not good consideration if you are otherwise entitled to it


Doctrine of Cumber v Wane - the court should strive to give effect to the engagements which persons have thought proper to enter into, rather than cast about for subtle reasons to doubt them upon being unreasonable.

Circumstances where payment of a lesser sum is binding - Exceptions:
**If the debt is paid before the date you are suppose to be paid, you can avoid the rule (pay a lesser sum in satisfaction of a larger sum).
**If you give someone something of value for them to accept less – makes the contract binding.
**Contract under seal.
**Promissory note (if you pay by this it is an exception).
**A owes money to many creditors, and they all agree with A that they will each accept less.
***The mutuality between the creditors takes the place of consideration – the composition of creditors.
***Each giving up opportunity of right to sue for full amount = consideration


Was no consideration – Interest due


  1. Fiat Justitia Ruat Caelum 32

    The creditor did not benefit from agreeing to a lesser sum (lack of $ interest). Therefore, right to full debt is not waived (unless -> see exceptions)

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