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Brief Fact Summary.
Bradshaw sued Burningham to uphold payment price for work done on a well in Burningham’s property.
Synopsis of Rule of Law.
Parties cannot sue the original version of any changed terms if a compromise agreement is a modification of a prior contract.
Where such a modification is agreed upon, the terms thereof govern the rights and obligations of the parties under the contract, and any pre-modification contractual rights which conflict with the terms of the contract as modified must be deemed waived or excused.
View Full Point of Law
Burningham hired Bradshaw to drill a well. Bradshaw stopped construction on the first well after running into a metal object that prevented the completion of the original well. Burningham agreed to pay Bradshaw $6,300 for the work done on the original well, and made a compromise agreement honoring the terms of the original contract for construction on a second well at an alternate location. Bradshaw sued Burningham when Burningham failed to pay the $6,300. The trial court granted judgment to Bradshaw.
Issue.
Whether parties can sue the original version of any changed terms if a compromise agreement is a modification of a prior contract?
Held.
No. The judgment of the trial court is affirmed. The second contract’s language identifies the contract as a modification because it states that the original contract would not hold where the compromise made changes. Bradshaw therefore was not entitled to sue under the original contract’s terms.
Discussion.
Parties cannot sue the original version of any changed terms if a compromise agreement is a modification of a prior contract. A contractual modification cancels the terms of an original contract. The modified terms in a contract are controlling and the original obligations in the contract are waived.