Section 852 — Compromise — effect on the parties

Firm annotation

Section 852 is the consequence rule for §850 compromise. Once parties settle, the original cause of action is gone — the new contract is the only enforceable obligation. Two critical implications: (1) breach of the compromise must be sued as a contract claim, not as the original tort or contract; (2) defenses available against the original claim are usually waived. SC decisions 1781/2567 and 1383/2568 explore the boundaries — a compromise on one dispute does not automatically bar separate fraud claims based on misrepresentations during the compromise negotiations.