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This problem is based on the rules of consideration and in particular the rule that payment
of a lesser sum on the day in satisfaction of larger is not sufficient consideration for the
creditor's promise to accept the sum in full settlement of the debt.
This is the rule in Pinnels Case (1602). However, this rule is subject to several exceptions.
The legal position is that S is not liable to P at all as his obligation has been discharged in
toto. This position may be justified on two arguments:
(i) P accepted payment of a lessor sum from a 3rd party and such a promise
is binding. This is consistent with the decision in Welby V. Drake.
(ii) One of the salient exceptions to the rule in Pinnels Cas eis that payment of a lesser
sum in the form of an object extinguishes the entire debt. In Pinnels Case Brian
C. J. was emphatic that the gift of a horse, hawk or robe is sufficient
consideration. It therefore follows that P's acceptance of the bags of
maize valued at Kshs. 30,000 extinguished S's obligation to him.
maurice.mutuku answered the question on April 28, 2018 at 13:37
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