Bainum v. Midland Acceptance Corp.

While it is the law that a new agreement does not afford a consideration for the performance of a contract which the party is bound to perform, we do not have that situation here. The mortgage gave the mortgagee the right to take possession of the automobile on default. It must either get possession by voluntary surrender or court action. Bainum had an equity in the car at the time. While the later sale of the car may have developed that equity was valueless, that could not have been known at the time the new contract was made. Had the car on re-sale brought more than the balance due on the…