Douglas v. Dixie Finance Corp.

• Decision Date: 10 June 1976
• Docket Number: No. 1,No. 51883,51883,1
• Citation: 139 Ga.App. 251,228 S.E.2d 144
• Court: Georgia Court of Appeals
• Parties: Mary DOUGLAS v. DIXIE FINANCE CORPORATION

Page 144

228 S.E.2d 144

139 Ga.App. 251

Mary DOUGLAS v. DIXIE FINANCE CORPORATION.

No. 51883.

Court of Appeals of Georgia, Division No. 1.

June 10, 1976.

Rehearing Denied July 9, 1976.

W. L. Dwyer, Americus, for appellant.

Lewis N. Jones, Laurie Hargrove, Americus, Gambrell, Russell, Killorin & Forbes, Douglas N. Campbell, John A. Clark, Atlanta, for appellee.

Charles M. Baird, Atlanta, amicus curiae.

STOLZ, Judge.

Dixie Finance Corporation brought suit against Mary Douglas and her former huband, Hollis Douglas, on a promissory note in the face amount of $2,640, of which $1,350 involved refinancing of a prior loan. It is uncontroverted that the prior loan violated the Georgia Industrial Loan Act as construed by this court in Lawrimore v. Sun Finance Co., 131 Ga.App. 96, 205 S.E.2d 110 and was null and void under the Supreme Court decision in Hodges v. Community Loan &c. Co., 234 Ga. 427, 216 S.E.2d 274. by stipulation the case was tried by the judge without a jury. In rendering judgment for the plaintiff, the trial judge found that the earlier void instrument 'was superseded by the later contract as to which is constituted an accord and satisfaction.' It is to the correctness of the ruling, from which defendant Mary Douglas appeals, that we first direct our attention.

1. 'Accord and satisfaction is where the parties, by a subsequent agreement, have satisfied the former one, and the latter agreement has been executed. The execution of a new agreement may itself amount to a satisfaction, where it is so expressly agreed by the parties; and without such agreement, if the new promise is founded on a new consideration, the taking of it is a satisfaction of the former contract.' Code § 20-1201.

Unless specifically agreed to by the parties, a renewal of a promissory note alone is not an accord and satisfaction. Blackshear Mfg. Co. v. Harrell, 191 Ga. 433(2), 12 S.E.2d 328. The record does not show any such agreement in this case. Moreover, the prior illegal contract could not be valid consideration for the execution of the note sued upon. 'If the consideration be good in part and void in part, the promise will be sustained or not, according as it is entire or severable, as hereinafter prescribed. If the consideration be illegal in whole or in part, the whole promise fails.' Code § 20-305. Hanley v. Savannah Bank & Trust Co., 208 Ga. 585, 68 S.E.2d 581.

2. Prior to the filing of the complaint in this case, the plaintiff caused its attorney to give the defendants notice pursuant to Code § 20-506, then brought suit for $2,200, 15% attorney fees, and court costs. Following the defendants' answer and counterclaim, the plaintiff amended its complaint by showing 'that the total amount stated in the complaint is reducible by any earned charges, all as particularly shown in the note, and as deducted on all previous notes of the defendants when they were renewed.' The plaintiff's loan manager testified that it would be entitled to an interest rebate of $185.71; life insurance rebate of $50.63; accident and health insurance rebate of $80.79; and household goods rebate of $53.86. Based on this testimony, after granting the defendant suretyship credit of $420.28, the trial judge entered judgment against the defendant for $1,408.73. In Reese v. Termplan, Inc., Bolton, 125 Ga.App. 473, 188 S.E.2d 177, this court held that the Installment Sales Act was violated at the time the seller attempted to accelerate the unpaid balance. In Harrison v. Goodyear Service Stores, 137 Ga.App. 223, 223 S.E.2d 261 we held that a 'good faith' offer to amend a complaint to correct an excessive time price differential, had no effect on the penalty provisions of the statute being construed. On p. 224, 223 S.E.2d p. 263 we noted: 'If a...