Foakes v Beer
[1884] UKHL 1, (1884) 9 App Cas 605
Independent editorial summary — not the official judgment. Read the full judgment via the source link.
Ratio Decidendi
Payment of a lesser sum cannot be satisfaction for a greater debt. The rule in Pinnel's Case (1602) was affirmed: a creditor's promise to accept part payment in full settlement is not binding for want of consideration, even where the debtor has relied upon it.
Facts
Dr Foakes owed Mrs Beer a judgment debt of £2,090. They agreed that Foakes would pay the sum by instalments and Beer would not take 'any proceedings whatever' on the judgment. Foakes paid the full principal but Beer then claimed interest on the judgment debt, which had not been mentioned in their agreement.
Judgment Summary
The House of Lords held that Beer was entitled to the interest. The agreement to accept payment by instalments was not supported by consideration — Foakes was merely paying what he already owed. There was no accord and satisfaction. Lord Blackburn expressed doubt about the rule but ultimately concurred.
Key Quotes
"Payment of a lesser sum on the day in satisfaction of a greater, cannot be any satisfaction for the whole."
— Earl of Selborne LC (affirming Pinnel's Case)
Subsequent Treatment
Remains binding House of Lords/Supreme Court authority on the requirement of consideration for part payment.
The harshness of the rule is mitigated by promissory estoppel (Central London Property Trust v High Trees House [1947]).
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