Argument for Plaintiff in Error.

The cases are very numerous in the state courts where the same doctrine has been clearly stated and enforced. Corse v. Peck, 102 N. Y. 513; Brewster v. Potruff, 55 Michigan, 129; Highstone v. Burdette, 61 Michigan, 54.

Of course there are exceptions to and qualifications of this rule. Thus, as stated by Judge Story and Chief Justice Marshall, that in cases of fraud, misrepresentation or duress, this may be shown by parol testimony for the purpose of showing the contract to be void and of no effect. So, if a written contract has been executed and delivered, but with a clear and distinct understanding that it was not to have effect until a certain condition had been performed or until a certain event had happened, this may be shown by parol. Ware v. Allen, 128 U. S. 596; Reynolds v. Robinson, 110 N. Y. 654. These cases are upon the clear and sensible doctrine that no contract was ever actually made, or had taken effect.

Another clearly recognized exception is, that oral testimony is admissible to contradict or vary the terms of simple receipts for money, and this upon the ground that they are informal, and are not in the nature of contracts, and, as said by Parsons, they are hardly "an instrument at all," and have little more force than an oral admission of the party receiving. 2 Parsons on Contracts, 555; 2 Whart. Ev. 920, 1064; Greenleaf's Ev. § 305.

If a receipt is connected with a contract, the receipt may be varied or contradicted by parol, but not the contract. The authorities upon this subject are very clear.

In the argument in the court below, the counsel for the plaintiffs insisted, that by the decisions of the State of New York, a contract or receipt like the one in question can be contradicted in all its parts. We have examined the New York cases cited, and we submit that a careful examination. will show that they are in harmony with our position in this case, and we call attention to them. See Egleston v. Knickerbacker, 6 Barb. 458, 466; Coon v. Knap, 4 Selden, 402; S. C. 59 Am. Dec. 502; Creery v. Holly, 14 Wend. 26; Kellogg v. Richards, 14 Wend. 116; Ryan v. Ward, 48 N. Y. 204; Smith v. Holland, 61 N. Y. 635; De Lavallette v. Wendt, 75 N. Y. 579.

Opinion of the Court.

None of the later cases in other States are inconsistent with the earlier New York cases. Tisloe v. Graeter, 1 Blackford, 363; Dale v. Evans, 14 Indiana, 288; Alcorn v. Morgan, 77 Indiana, 184; Fay v. Gray, 124 Mass. 500; Goss v. Ellison, 136 Mass. 503; Brown v. Cambridge, 3 Allen, 474; Kansas City & Olathe Railway v. Hicks, 30 Kansas, 288.

There are many cases that hold, where a contract and a receipt are combined in the same written instrument, that while the simple receipt may be varied by parol testimony, the contract connected therewith cannot thus be affected. Lowe v. Young, 59 Iowa, 364; Hewett v. Chicago, Burlington &c. Railway, 63 Iowa, 611; Bemis v. Becker, 1 Kansas, 226, 240; Edgerly v. Emerson, 3 Foster (23 N. H.) 555, 564; S. C. 55 Am. Dec. 207. So in relation to bills of lading and warehouse receipts. Graves v. Ilarwood, 9 Barb. 477, 481; O'Brien v. Gilchrist, 34 Maine, 554; S. C. 56 Am. Dec. 676; Stewart v. Phoenix Ins. Co., 9 Lea, 104; Smith v. Brown, 3 Hawks, 580.

Mr. F. H. Canfield and Mr. Joseph H. Choate for defendants in error.

MR. JUSTICE BROWN delivered the opinion of the court.

As we held in this case on the motion to dismiss, (Fire Insurance Association v. Wickham, 128 U. S. 426,) that the second question was improperly certified and could not be answered, the only question now presented for decision is the first, namely: "On the facts stated in the foregoing record, was the parol testimony offered in evidence by the plaintiffs admissible to vary and contradict the certificate of January 19, Exhibit QQ, and the receipts and drafts herein before set forth?"

We have no disposition to overrule or qualify in any way the general and familiar doctrine enforced by this court in . repeated decisions, from the case of Hunt v. Rousmanier, 8 Wheat. 174, decided in 1823, to that of Seitz v. Brewers' Refrigerating Company, ante, 510, decided at the present term, that parol testimony is not admissible to vary, contradict, add

Opinion of the Court.

to or qualify the terms of a written instrument. The rule, however, is subject to numerous qualifications, as well established as the general principle itself, among which are that such testimony is admissible to show the circumstances under which the instrument was executed, or that it was in fact without consideration.

It was not seriously contended in this case that the defendant was not legally liable upon its policies for the expenses, clearly incidental to the fire, of raising and saving the vessel, as well as for the direct injury to the vessel in consequence of the fire, and if the plaintiffs were induced to settle their claims for one-half the amount that was due them, and there was no consideration for the relinquishment of the other half, this suit will lie for the recovery of the amount. The rule is well established that where the facts show clearly a certain sum to be due from one person to another, a release of the entire sum upon payment of a part is without consideration, and the creditor may still sue and recover the residue. If there be a bona fide dispute as to the amount due, such dispute may be the subject of a compromise and payment of a certain sum as a satisfaction of the entire claim, but where the larger sum is admitted to be due, or the circumstances of the case show that there was no good reason to doubt that it was due, the release of the whole upon payment of part will not be considered as a compromise, but will be treated as without consideration and void. As was said by Chief Justice Waite in United States v. Bostwick, 94 U. S. 53, 67: "Payment by a debtor of a part of his debt is not a satisfaction of the whole, except it be made and accepted upon some new consideration:" although it was subsequently held in Baird v. United States, 96 U. S. 430, 431, that if the debt be unliquidated and the amount uncertain, this rule does not apply. "In such cases the question is, whether the payment was in fact made and accepted in satisfaction." The authorities upon this point are numerous and decisive. Pinnel's Case, 5 Rep. 117; Fitch v. Sutton, 5 East, 230; Harriman v. Harriman, 12 Gray, 341, 343; Redfield v. Holland Ins. Co., 56 N. Y. 354; Ryan v. Ward, 48 N. Y. 204; American Bridge Co. v. Murphy, 13 Kansas, 35; White v. Jor

VOL. CXLI-37

dan, 27 Maine, 370;

Opinion of the Court.

Bailey v. Day, 26 Maine, 88; Weber v.
Foakes v. Beer, 9 App. Cas. 605.

Couch, 134 Mass. 26;
In this case there were two distinct and separate claims of
similar amount, namely, $15,364.78, one of which was for the
direct loss and damage to the property insured by the fire, and
the other was for the incidental cost of raising the propeller
and her cargo. The plaintiffs assumed, upon the face of the
receipts, to settle with the defendant for both of these claims
by the payment of the exact amount of one of them. In
other words, they assumed to settle for a moiety of their en-
tire claim a claim the legality and justness of which was so
far beyond dispute that it could hardly fail to be recognized
by the agents of the insurance companies who were present at
the meeting in New York. That they intended and supposed
they were making a settlement of the plaintiffs' entire claim
against them is probably true. But, aside from the parol tes-
timony given by Wickham of the conversation at the meeting,
the admissibility of which is the question in dispute, there was
some evidence tending to show that the plaintiff Wickham
may have supposed that he was settling only for the direct
loss by the fire in the agreement for the survey or appraise-
ment of the damages signed by both parties, which provided
that it should not "apply to or cover any question that may
arise for saving boat and cargo." There were also other cir-
cumstances tending to show that the agents of the companies
might have known that Wickham supposed he was settling
only for the direct loss. First, in the letter of Allen, the ad-
juster, who, in transmitting proofs of loss to the various com-
panies, stated that "the assured will make further claims for
expenses of raising the propeller, and is now preparing the
statement of such expenses to submit with his subsequent
claim." And secondly, in the memorandum of the meeting of
the companies, January 18, Exhibit PP, in which, after reading
a communication from an adjuster at Detroit in relation to
the salvage expenses, a motion was carried "that the request
of the assured to help him out is not granted, but the com-
panies are recommended to pay the amount of claim as set
forth in the proofs of loss." These items of testimony are in-

Opinion of the Court.

consistent with the idea that the agents of the companies did not know of the further claim, and are also pertinent upon the question whether Wickham understood that he was settling that claim.

(1) But assuming that the receipts upon their face show a complete settlement of the entire claim for one-half the total amount, what was the consideration for the release of the other half? The only one that is put forward for that purpose is that payment was made five days after proofs of loss were furnished, or fifty-five days before anything was actually due by the terms of the policy. That prepayment of part of a claim may be a good consideration for the release of the residue is not disputed; but it is subject to the qualification that nothing can be treated as a consideration that is not intended as such by the parties. Thus in Philpot v. Gruninger, 14 Wall. 570, 577, it is stated that "nothing is consideration that is not regarded as such by both parties." To constitute a valid agreement there must be a meeting of minds upon every feature and element of such agreement, of which the consideration is one. The mere presence of some incident to a contract which might under certain circumstances be upheld as a consideration for a promise, does not necessarily make it the consideration for the promise in that contract. To give it that effect it must have been offered by one party and accepted by the other as one element of the contract. In Kilpatrick v. Muirhead, 16 Penn. St. 117, 126, it was said that "consideration, like every other part of a contract, must be the result of agreement. The parties must understand and be influenced to the particular action by something of value or convenience and inconvenience recognized by all of them as the moving cause. That which is a mere fortuitous result flowing accidentally from an arrangement, but in no degree prompting the actors to it, is not to be esteemed a legal consideration." See also 1 Addison on Contracts, 15; Ellis v. Clark, 110 Mass. 389. Now evidence of what took place at the meeting, if admissible for no other purpose, was competent as bearing upon the question whether the prepayment was mentioned or treated as an inducement or consideration for the release of the residue of the claim. It certainly