novation

novation
    n 1: (law) the replacement of one obligation by another by
         mutual agreement of both parties; usually the replacement
         of one of the original parties to a contract with the
         consent of the remaining party
    

Novation \No*va"tion\, n. [L. novatio; novus new: cf. F.
   novation.]
   1. Innovation. [Obs.]
      [1913 Webster]

            I shall easily grant that novations in religion are
            a main cause of distempers in commonwealths. --Laud.
      [1913 Webster]

   2. (Law) A substitution of a new debt for an old one; also,
      the remodeling of an old obligation; debt restructuring.
      [1913 Webster +PJC]
    

NOVATION, civil law. 1. Novation is a substitution of a new for an old debt. 
The old debt is extinguished by the new one contracted in its stead; a 
novation may be made in three different ways, which form three distinct 
kinds of novations. 
     2. The first takes place, without the intervention of any new person, 
where a debtor contracts a new engagement with his creditor, in 
consideration of being liberated from the former. This kind has no 
appropriate name, and is called a novation generally. 
     3. The second is that which takes place by the intervention of a new 
debtor, where another person becomes a debtor instead of a former debtor, 
and is accepted by the creditor, who thereupon discharges the first debtor. 
The person thus rendering himself debtor for another, who is in consequence 
discharged, is called expromissor; and this kind of novation is caned 
expromissio. 
     4. The third kind of novation takes place by the intervention of a new 
creditor where a debtor, for the purpose of being discharged from his 
original creditor, by order of that creditor, contracts some obligation in 
favor of a new creditor. There is also a particular kind of novation called 
a delegation. Poth. Obl. pt. 3, c. 2, art. 1. See Delegation. 
     5.-2. It is a settled principle of the common law, that a mere 
agreement to substitute any other thing in lieu of the original obligation 
is void, unless actually carried into execution and accepted as 
satisfaction. No action can be maintained upon the new agreement, nor can 
the agreement be pleaded as a bar to the original demand. See Accord. But 
where an agreement is entered into by deed, that deed gives, in itself, a 
substantive cause of action, and the giving such deed may be sufficient 
accord and satisfaction for a simple contract debt. 1 Burr. 9; Co. Litt. 
212, b. 
     6. The general rule seems to be that if one indebted to another by 
simple contract, give his creditor a promissory note, drawn by himself, for 
the same sum, without any new consideration, the new note shall not be 
deemed a satisfaction of the original debt, unless so intended and accepted 
by the creditor. 15 Serg. & Rawle, 162; 1 Hill's N. Y. R. 516; 2 Wash. C. C. 
Rep. 191; 1 Wash. C. C. R. 156, 321; 2 John. Cas. 438; Pet. C. C. Rep. 266; 
2 Wash. C. C. R. 24, 512; 3 Wash. C. C. R. 396: Addis. 39; 5 Day, 511; 15 
John. 224; 1 Cowen, 711; see 8 Greenl. 298; 2 Greenl. 121; 4 Mason, 343; 9 
Watts, 273; 10 Pet. 532; 6 Watts & Serg. 165, 168. But if he transfer the 
note he cannot sue on the original contract as long as the note is out of 
his possession. 1 Peters' R. 267. See generally Discharge; 4 Mass.. Rep. 93; 
6 Mass. R. 371; 1 Pick. R. 415; 5 Mass. R. 11; 13 Mass. R. 148; 2 N. H. Rep. 
525; 9 Mass. 247; 8 Pick. 522; 8 Cowen, 390; Coop. Just. 582; Gow. on Partn. 
185; 7 Vin. Abr. 367; Louis. Code, art. 2181 to 2194; Watts & S. 276; 9 
Watts, 280; 10 S. R. 807; 4 Watts, 378; 1 Watts & Serg. 94; Toull. h.t.; 
Domat, h.t.; Dalloz. Dict. h.t.; Merl. Rep. h.t.; Clef des Lois Romaines, 
h.t.; Azo & Man. Inst. t. 11, c. 2, SS 4; Burge on Sur. B. 2, c. 5, p. 166.