Dunham v. Griswold, 100 N.Y. 224 (1885)

A promise to pay a debt, even if previously disputed, is enforceable unless made under duress that overcomes the promisor’s free will; a mere threat of civil action and arrest does not constitute such duress.

Summary

Dunham sued Griswold to recover a sum Griswold promised to pay in a settlement agreement. Griswold argued he didn’t owe the original debt and signed the agreement under duress. The court held that a settlement agreement, even if the underlying debt is questionable, is enforceable if made without duress. A mere threat of a civil suit and arrest does not constitute duress sufficient to void the agreement; rather, the duress must have overcome Griswold’s free will, which was a question of fact the trial court resolved against him.

Facts

Dunham claimed Griswold owed him $9,000 from a prior securities transaction. Griswold disputed the claim. To resolve the dispute, the parties entered a settlement agreement where Griswold acknowledged the $9,000 debt and promised to pay it. Dunham then sued Griswold to enforce this agreement. Griswold claimed he didn’t owe the original debt and signed the agreement under duress.

Procedural History

The trial court found in favor of Dunham, enforcing the settlement agreement. Griswold appealed to the New York Court of Appeals. The Court of Appeals affirmed the trial court’s judgment, upholding the enforceability of the settlement agreement.

Issue(s)

1. Whether a settlement agreement, where the promisor acknowledges a debt and promises to pay, is enforceable even if the promisor can prove the underlying debt was not actually owed.
2. Whether the promisor’s claim of duress, based on threats of civil action and arrest, is sufficient to invalidate the settlement agreement.

Holding

1. Yes, because a promise to pay in a settlement of a disputed claim is supported by sufficient consideration, even if the underlying debt is questionable.
2. No, because a mere threat to sue and arrest the defendant in a civil action does not constitute duress sufficient to void a promise, unless it is shown that the threats constrained the will of the promisor and induced the promise.

Court’s Reasoning

The court reasoned that settling a disputed claim provides sufficient consideration for a promise to pay, regardless of the validity of the original claim. The court cited precedent such as Stewart v. Ahrenfeldt, 4 Denio, 189, establishing this principle. Regarding duress, the court emphasized that not all threats constitute duress. A threat of civil action and arrest is generally insufficient to invalidate an agreement. The court stated, “A mere threat to sue the defendant and to arrest him in such suit, or by virtue of an execution which could be issued upon a judgment obtained therein, would not be such duress as would avoid a promise induced by such threat.” The court emphasized that the key question is whether the threats overcame the promisor’s free will. The court determined the trial court correctly found that Griswold’s will was not overcome, and the agreement was therefore enforceable. The court noted: “When there is no arrest, no imprisonment, no actual force, and it is claimed that a promise was obtained by duress per minas, then whether or not the promise was obtained by duress must usually be a question of fact, and the question cannot be determined as one of law. It is not sufficient in such a case to satisfy the trial court that the threats were uttered; but it must also be shown that they constrained the will of the promisor and induced the promise.”