Backus v. Spaulding

One promise is a legal consideration for another. Met. Con. 182. If a promissory note is made by A. to B. in exchange for a promissory note made by B. to A., each note is a valid consideration for the other, whether between the original parties, or in an action by an indorsee. Eaton v. Carey, 10 Pick. *420211. Higginson v. Gray, 6 Met. 212. Whittier v. Eager, 1 Allen, 499. If both notes are over due, and each remains in the hands of its payee, the one may doubtless be set off against the other. But the two contracts, though mutual, are independent, and if they are for the payment of money at different times, each must be performed according to its terms. Strangborough v. Warner, 4 Leon. 3. Waterhouse v. Kendall, 11 Cush. 128. Traver v. Stevens, Ib. 167.

But this case is not one of a mere exchange of notes. The plaintiff, in consideration of a sum of money lent to him by the defendants’ testator, and of a note made to him by the latter for the payment of an additional sum in four months, made and delivered to him a note for the amount of both sums, payable in six years, together with an assignment, as collateral security for the payment thereof, of a contract relating to certain real estate. The promise of the plaintiff to pay his note at maturity, and the delivery of the collateral security.for the performance of that promise, constitute a sufficient consideration for the promise, contained in the note received by him, to pay the sum therein expressed at an earlier date. Exceptions sustained.