Need for Agreement (offer plus acceptance). } Need for Consideration. Particularly as it relates to the performance of existing contractual obligations to the same party ... ? Stilk v Myrick (1809) ? Hartley v Ponsonby (1857) ? Williams v Roffey Bros (1990) Supply of goods and services- a new promise which varies the contract when the promisee is only performing an existing obligation is binding on the promisor if the promisor receives a 'practical benefit' (Williams v Roffey Bros). ? However, in relation to debts owed, and paying a different sum (which is in effect a variation of the original contract to pay a certain amount), what is position of the law ?. Can a promise to accept less than is owed in order to extinguish a debt be enforceable? >Example · Bill is owed £2000 by Andy. ? Andy offers to pay £1500 - says he cannot afford any more. ? Bill accepts, and promises not to try to recover the remaining £500. ? Is Bill (the promisor) bound by this promise? } Pinnel's Case (1602) Part payment of a debt on the date on which it is due can never be satisfaction for the full amount owed. However, ? Early part payment at the request of the creditor ? Payment on the due date but at a different location from the one specified in the contract ? Provision of goods or services instead of money ? Something additional offered - "the gift of a horse, hawk, robe" will amount to consideration if acceptable to creditor. The rule in Pinnels's Case was obiter, because the debtor in that case had actually paid early and had therefore provided sufficient consideration to discharge the entire debt. However, this rule/principle as regards part payment of debts was confirmed by the House of Lords in Foakes v Beer (1884). Dr Foakes owed money to Mrs Beer. Mrs Beer agreed to accept payment by instalments. At end of the instalment payments, Mrs Beer claimed the interest on the debt, because of the instalment (ie delayed) payments. The House of Lords confirmed that she was entitled to recover the interest and any promise to accept less than she was owed was not binding. Even if Mrs Beer had promised not to demand the interest, that promise was unenforceable because Dr Foakes provided no consideration for it.
So, the part payment (ie paying by instalments) could not in itself extinguish the entire debt (ie entire amount plus interest). >This principle has been confirmed in other cases- Re Selectmove [1995]; Ferguson v Davies [1997]