Minnesota &Amp; O.P. Co. v. Register &Amp; T. Co.

• Decision Date: 08 May 1928
• Citation: 219 N.W. 321,205 Iowa 1228
• Parties: Minnesota &Amp; Ontario Paper Company, Appellant, v. Register &Amp; Tribune Company, Appellee.
• Court: Iowa Supreme Court

219 N.W. 321

205 Iowa 1228

Minnesota &Amp Ontario Paper Company, Appellant, v. Register &Amp Tribune Company, Appellee.

Supreme Court of Iowa

May 8, 1928

SYLLABUS BY THE COURT

ACCORD AND SATISFACTION: Inadvertent Cashing of Check. When 1 parties are in a bona-fide dispute as to the amount due on an account, the receipt by the creditor from the debtor of a check marked "In full of account," and accompanied by a letter to the same effect, and the cashing of said check in the ordinary course of business, constitute a complete accord and satisfaction, even though the creditor, in cashing the check, overlooked the fact that both the check and the letter notified him that the remittance was in full settlement of the account. ACCORD AND SATISFACTION Consideration — Bona-fide Dispute. The 2 settlement of a bona-fide dispute as to the amount of an account is ample consideration for an accord and satisfaction. Headnote 1: 1 C.J. p. 562. Headnote 2: 1 C.J. p. 564. Headnote 1: 14 L.R.A (N.S.) 443; 34 A.L.R. 1035; 1 R.C.L. 196.

Appeal from Polk District Court. — W.G. BONNER, Judge. Action to recover under a contract for the sale of certain print paper. The trial court directed a verdict for the defendant and plaintiff appeals. — Affirmed.

Lancaster Simpson, Junell & Dorsey, Robert Driscoll, and John McLennan, for appellant.

Clark & Byers, for appellee.

The opinion of the court was delivered by: Faville, J.

On or about the 26th day of June, 1913, the parties to this action entered into a contract for the sale of certain print paper by the appellant to the appellee. A large 1. ACCORD AND quantity of paper appears to have been shipped SATISFAC- under said contract. This case involves only the TION purchase price of three carloads, and the action inadvertent is for a balance claimed to be due on said cashing of purchase price. The appellee tenders an issue as check. to a compliance with the contract on the part of the appellant, and pleads an accord and satisfaction. Two main questions are presented on this appeal: (1) As to whether or not the appellant proved anything due it under the contract; and (2) whether or not there was such proof of an accord and satisfaction as warranted the court in directing a verdict in behalf of the appellee.

I. It may be conceded that, under the evidence in the case, there was a question as to the quality or grade of a portion of the paper furnished by appellant to appellee, and that the amount due for said paper, under the contract and evidence, would be a question for the jury; but, in view of our conclusion on the other branch of the case, this question becomes immaterial, and we give it no further consideration.

II. The important question in this case is whether or not there was an accord and satisfaction established by the record. The plea of accord and satisfaction is an affirmative defense, and the burden rested upon the appellee to establish the same. The evidence in the case is practically without dispute, and the officers of both appellant and appellee testified with commendable frankness. Appellant contends that an accord and satisfaction was not established, on the two grounds that no valid consideration was shown for the claimed accord and satisfaction, and that there was no proof of a meeting of the minds of the parties. A brief review of the facts of the case is necessary. It appears that, after the receipt of the three carloads of paper in question, to wit, on or about July 11, 1914, the appellee paid the appellant $1,008.32 on account. It also appears that there arose a dispute and controversy between the parties as to the balance due on said carload of paper. The question between the parties involved the matter of quality of certain of the paper furnished, rather than quantity. It is unnecessary that we discuss the merits of this question, but the fact is clearly established that the parties were not in agreement as to the amount due for the paper furnished. Finally, on or about October 3, 1914, the appellee sent the appellant a letter, inclosing a check payable to the order of the appellant. The accompanying letter was not produced, and the copy thereof was shown to be burned. The business manager of the appellee, who wrote said letter and check, is deceased. It clearly appears, under the record, that the check bore a statement to the effect that it was sent "in full

of account" between the parties, and that the accompanying letter contained a statement to the effect that the check was sent in full settlement of said account. The evidence shows that the appellant received the letter and check at its business office in Minneapolis on or about October 5, 1914. The check was duly indorsed by the appellant, and was deposited to its account in a bank in Minneapolis on or about said date. It appeared that, at the time of the trial, the amount of said check was so retained on deposit by the appellant. The treasurer of the appellant, who had charge of its finances, testified in regard to the check, in part, as follows:

"I have no independent recollection of the receipt by the Minnesota & Ontario Paper Company of the check for $749.36. Such a check was received. I cannot say whether it came to me personally or not. Q. What was the practice in your office at that time in regard to incoming checks? A. Well, the mail is opened and distributed to the various departments, and the mail relative to collections and remittances came to my desk. Q. And when that mail, if it included checks paid on outstanding accounts, came to your desk, did it have the checks attached to the letters still? A. Yes, usually. Q. And did those checks and letters remain on your desk until you personally examined them? A. As a general thing, the checks were taken out and passed to the cashier, to be deposited in the bank, and then the correspondence, if there was anything necessary, would be taken up and handled. * * * This check, which has been referred to, was deposited in the Northwestern National Bank of Minneapolis, and placed to the credit of the Register & Leader Company. Q. What was the practice in your office in regard to the indorsement of checks for deposit at that time? A. Well, they were sent to the cashier's desk, and indorsed for deposit with a rubber stamp, indicating which bank they were deposited in. Q. And the rubber stamp was in your name, as treasurer, I assume? A. The company, by me, treasurer. The date on which that deposit was made was October 5, 1914. On or before October 8th, it first came to my attention that the defendant was claiming that the check had been tendered in full settlement of all of the accounts between the parties between the date it was received and October 8, 1914. It did not come to my attention prior to the deposit of the check. * * * I didn't know, at the time this check was deposited, that there was any claim that it was tendered in full settlement. * * * This check was received by the person whose duty it was to receive it and to enter it on a list of items for deposit, and to indorse it and put it in the bank."

On October 8, 1914, the appellant sent the appellee a draft for the amount of $749.36, and wrote as follows:

"We are in receipt of your check for $749.36 on your account. By a clerical error the check was deposited before it was noted that you wished this amount to pay in full our invoice No 343 for $1,054.68, shipped August 4th and our invoice No. 349 for...