Citation. 144 N.Y. 392, 39 N.E. 330, 1895 N.Y. 541
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P sued D for payment on a promissory note endorsed by D.
Synopsis of Rule of Law.
A creditor’s promise to forbear the collection of a debt “until such time as I want my money” is illusory and the agreement is not enforceable against either party.
Facts.
Strong (P), a creditor, promised to forbear collection of a debt owed by the husband of Sheffield (D), if D promised to pay P should D’s husband not pay. The debt owed by D’s husband was presently due. P did not demand payment for 2 years. P brought suit against D for the endorsement on the collection of the debt owed by the husband of D. Judgment for P. Reversed by Supreme Court of New York. P appealed.
Issue.
Did P’s promise to forbear impose a duty upon him?
Held.
No. Judgment for D affirmed.
An agreement by a creditor to forbear the collection of a debt presently due is a good consideration for an absolute or conditional promise of a third person to pay the debt. However, in this case, the note did not legally extend the payment of the debt.
P’s promise to forbear collection of a debt payable on demand imposed no duty on P to forbear and was not a consideration for D’s promise to pay if her husband did not. There was no agreement to forbear for a fixed time or a reasonable time, but an agreement for such a time as P should elect. Nothing prevented P from an immediate suit on the note. P’s promise was illusory and either party could enforce the agreement.
Discussion.
An illusory promise is a promise in form, but not in substance. An illusory promise is not consideration for the other promise.
