In consideration that the plaintiff would forbear taking such proceedings for an agreed time, the defendant promised to deliver to Callisher a set of Honduras Railway Loan Bonds.
The Queen's Bench held the contract was enforceable because even if the suit was groundless, forbearing to sue could count as a valuable consideration.
No doubt it must be taken that there was, in fact, no claim by the plaintiff against the Honduras Government which could be prosecuted by legal proceedings to a successful issue; but this does not vitiate the contract and destroy the validity of what is alleged as the consideration.
It would be another matter if a person made a claim which he knew to be unfounded, and, by a compromise, derived an advantage under it: in that case his conduct would be fraudulent.
If the plea had alleged that the plaintiff knew he had no real claim against the Honduras Government, that would have been an answer to the action.Blackburn J concurred: I am of the same opinion.