Stewart Jacobs signed a promissory note for $400,000 with Gainsworth Finance. Two years after signing the note, Mr. Jacobs requested that the note be drafted with his company, Jacobs Construction, as the primary obligor on the note. Gainsworth agreed. As construction jobs ceased, so did Mr. Jacobs payment on the note to Gainsworth. In a letter, Gainsworth demanded payment from Mr. Jacobs. Jacobs ignored the letter. Gainsworth sued. In his response, Jacobs raised the defense of novation. He claimed that Gainsworth agreed to substitute his company as the primary obligor on the note. Does Mr. Jacobs have a viable defense? Explain your response.
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