§ I. Waiver.

A contract may be discharged by express agreement that Waiver,

it shall no longer bind either party. This process is called

a waiver, cancellation, or rescission of the contract.

An agreement of this nature is subject to the rule which

governs all simple contracts, with regard to consideration.

And th« consideration for the promise of each party is the

abandonment by the other of his rights under the contract.

The rule, often stated, that *a simple contract may, be/ore By\cs on bhis,

breach^ be waived or discharged, without a deed and without

consideration,' must be taken to mean that, where the con-

tract is executory, no further consideration is needed for

an agreement to rescind, than the discharge of each party by

the other from his liabilities under the contract.

There seems to be no authority for saying that a contract. Mere

executed upon one side, can be discharged before breach, ^nti^actual

without consideration: that where A has done all that he was T^^f?,

invalid.

bound to do and the time for X to perform his promise has

248 DISCHARGE OF CONTRACT. Part V.

not yet arrived, a bare waiver of his claim by A would be an

effectual discharge to X.

In fact, English law knows nothing of the abandonment

of such a claim, except by release under seal, or for considera-

lSHS ftlc ^^°' ^^^ ^^^^ ^^ * waiver' under the old system of pleading

Tit^wfi?!?! was couched in the form of an agreement between the parties

to waive a contract, an agreement consisting of mutual

promises, the consideration for which is clearly the relin-

quishment of a right by each promisee. Where a discharge

by waiver is alleged as a defence in an action for breach

of contract, the cases tend to show that the defendant must

set up, in form or substance, a mutual abandonment of claims,

or else 'a new consideration for the waiver.

7 M. & w. ss. In King v. Gillett, the plaintiff sued for breach of a promise

of marriage; the defendant pleaded that before breach he

had been exonerated and discharged by the plaintiff from

the performance of his promise. The Court held that the

plea was allowable in form ; * yet we think,' said Alderson, B.,

'that the defendant will not be able to succeed upon it,

. . . unless he proves a proposition to exonerate on the part

of the plaintiffs acceded to hy himself ; and this in effect will

be a rescission of the contract.'

9 H. & N. 7» In Dobson v, Espie^ the plaintiff sued the defendant for

non-payment of deposit money due upon a sale of land.

The defendant pleaded that, before breach of his promise to

pay, the plaintiff had given him leave and license not to

pay. The Court held that such a plea was inapplicable to

a suit for the breach of a contract, and that the defendant

should have pleaded an exoneration and discharge; but it

is difficult to see why the pleader should not have adopted

the latter form of plea, unless it were that (according to the

reasoning of Alderson, B., in King v. GiUett) an eoconeration

means a promise to exonerate, which like any other promise

needs consideration to support it. It is clear that in Dobson

V. JEspie the plaintiff was to obtain nothing for his alleged

Chap. I. § I. BY AGREEMENT. 249

waiver; neither the relinquishment of a claim, nor any

fresh consideration.

Finally, we have the express authority of Parke, B., in

Foster v, Dawher, for saying that an executed contract, i. e. 6 Exch. 839.

a contract in which one of the parties has performed all

that is due from him, cannot be discharged by a parol

waiver. But this case illustrates another feature of the

matter under discussion, to which we will now proceed.

To the general rule which ^ we have laid down there is Peculiarity

1. 1 '11 <• 1 1 of bills of

an important exception m the case of bills of exchange and exchange

promissory notes. The rights of the holder of such instru- soiy notS!

ments may be waived and discharged without any considera-

tion for such waiver. The point arose in. the case of Foster 6 Exch. 839.

V. Dawber, The plaintiff was the executor of one J, C, to

whom the defendant had given promissory notes for Xiooo

as security for a loan of that amount. Afterwards J, C, had

given the defendant a discharge for the promissory note.

It was held that the discharge, though unsupported by con-

sideration, was valid.

The Court said, ' It is competent for both parties to an

executory contract, by mutual agreement, without any satis-

faction, to discharge the obligation of that contract. But an

executed contract cannot he discharged except by a release

under seal, or by 'performance of the obligation, as by pay-

ment, where the obligation is to be performed by payment.

But a promissory note or a bill of exchange appears to

stand on a different footing to simple contracts The

rule of law has been so often laid down and acted upon,

although there is no case precisely on the point as between

immediate parties, that the obligation on a bill of exchange

may be discharged by express waiver, that it is too late now « exch. 851.

to question the propriety of that rule.'

And it was further held that the rule as to bills of ex-

change, originating in the law merchant by which those

instruments are almost entirely governed, would apply to

250 DISCHARaE OF CONTRACT. PartV.

promissory notes which derive their negotiable character

from statute. The statute 3 <fe 4 Anne, c. 9, makes the same

law applicable to both instruments.