Metropolitan Life Ins. Co. v. Perrin

• Decision Date: 17 October 1938
• Docket Number: 33341
• Citation: 184 Miss. 249,183 So. 917
• Court: Mississippi Supreme Court
• Parties: METROPOLITAN LIFE INS. CO. v. PERRIN

183 So. 917

184 Miss. 249

METROPOLITAN LIFE INS. CO. v. PERRIN

No. 33341

Supreme Court of Mississippi

October 17, 1938

Division A

1. ACCORD AND SATISFACTION. Compromise and settlement.

A debtor's payment of any amount on a debt is sufficient consideration for creditor's agreement to accept such amount in full satisfaction, irrespective of whether the debt is liquidated or disputed.

2. ACCORD AND SATISFACTION. Compromise and settlement.

Where creditor accepts payment of less than the full amount of his claim in satisfaction of the claim, that creditor protests against receiving the smaller amount is of no consequence to prevent the acceptance from being an accord and satisfaction.

3. ACCORD AND SATISFACTION. Compromise and settlement.

An offer of part payment of a creditor's claim in full satisfaction of the whole must be clear and unequivocal in order to bind the creditor by acceptance thereof.

4. ACCORD AND SATISFACTION. Insurance.

Where disability insurer sent insured a check reciting "for total and permanent disability payment" and "received payment in full as detailed on reverse side," the effect of insured's acceptance of such check, as an accord and satisfaction of insured's claim for further benefits, was not destroyed by accompanying letter which described how insurer determined that the amount of the check was all that was due.

5. APPEAL AND ERROR.

On appeal from judgment for plaintiff entered after demurrer to defendant's plea was sustained and defendant failed to plead further, reviewing court could not consider a letter copy of which was filed with the demurrer, which did not appear in defendant's plea but allegedly altered the effect to be given to an instrument relied on in the plea.

6 PLEADING.

A demurrer challenges the sufficiency only of the allegations of the pleading demurred to, and hence a demurrer setting forth facts not appearing in the challenged pleading should be overruled as a "speaking demurrer."

HON ARTHUR G. BUSBY, Judge.

APPEAL from the circuit court of Lauderdale county HON. ARTHUR G BUSBY, Judge.

Action by R. O. Perrin against the Metropolitan Life Insurance Company, to recover disability indemnities. From a judgment for plaintiff, defendant appeals. Reversed and remanded.

The letter referred to in the opinion as "Exhibit C," and ordered to be reported, follows:

"January 29, 1934. "After entry By.

"M. L. B.

"C. Peterson

"Return to Disability Sec.

"Ford D 13

"Sect.

"Mr. Robert O. Perrin

"Basic Mississippi

"In re Paramount Disability

"3792286-A 4805059-A

"Robert O. Perrin

"Dear Sir:

"This is in reply to your January 29th Telegram. We regret to note that there appears to be some misunderstanding regarding the payment of benefits due under the above policies.

"May we respectfully refer you to the disability clauses in your policies and you will observe they stipulate that total disability must exist for three complete months before claim can be considered and then to be favorably so, such total disability must be further shown to be permanent. The disability clause further agrees that monthly income payments shall commence as of the date of total disability and that waiver of payment of premiums shall become effective as of the anniversary dates of the policies next succeeding the commencement of total disability. Neither the waiver of premiums or the payment of income shall commence as of a date more than six months prior to the date of receipt of proof of total and permanent disability.

"Total disability, according to our records and substantiated by your statement, became effective October 1, 1933. Consequently we based the payment of income benefits as of this date and waived premiums under the first mentioned policy from the anniversary date November 14, 1933 and under the second policy from January 1, 1934.

"Prior to October 1, 1933, it is indicated that you were engaged in part time work and this is substantiated by your own admission, Cosequently, we could not consider you totally disabled.

"Your claim for total and permanent disability benefits has been settled in accordance with the terms and conditions of the disability clause in the policies, and we trust you will appreciate the justification of our action.

"Yours truly

"Supervisor Permanent Disability"

Reversed and remanded.

Wells, Wells & Lipscomb, of Jackson, for appellant.

Where a sum of money is tendered in satisfaction of the claim, and the tender is accompanied with such acts and declarations as amount to a condition that, if the money is accepted, it is accepted in satisfaction, and such that the party to whom it is offered is bound to understand therefrom that, if he takes it subject to such condition, an acceptance of the money offered constitutes art accord and satisfaction. This is true although the creditor protests at the time that the amount paid is not all that is due, or that he does not accept it in full satisfaction of his claim. Where the tender or offer is thus made, the party to whom it is made has no alternative but to refuse it or accept it upon such condition. If he accepts it, he accepts the condition also, notwithstanding any protest he may make to the contrary.

Clayton v. Clark, 74 Miss. 499, 21 So. 565; Cooper & Rock v. Y. & M. V. R. R. Co., 82 Miss. 634, 35 So. 162; Greener & Sons v. Cain & Sons, 137 Miss. 33, 101 So. 859; Phillips v. St. Paul Fire & Marine Ins. Co., 156 Miss. 41, 125 So. 705.

In the case of May Bros. v. Doggett, 155 Miss. 849, 124 So. 476, the court laid down the rule that in Mississippi the rule as to accord and satisfaction applies not only to unliquidated demands, but also to liquidated demands.

Clayton v. Clark, 74 Miss. 499, 21 So. 565; Greener & Sons v. Cain & Sons, 137 Miss. 33, 101 So. 859; Y. & M. V. R. R. Co. v. Sideboard, 161 Miss. 4, 133 So. 669; Blue Ribbon Creamery Co. v. Monk, 168 Miss. 130, 147 So. 329; Stovall v. Lampton Co., 174 Miss. 58, 164 So. 39; Jones v. McFarland, 178 Miss. 282, 173 So. 296; State Highway Dept. v. Duckworth, 178 Miss. 35, 172 So. 148.

It is our position that applying the above authorities to the facts alleged in the plea of accord and satisfaction, and admitted by the demurrer, we must come to the inescapable conclusion that the acceptance by the plaintiff of the cheek tendered to him under the circumstances as shown by the correspondence, and the cheek itself, constituted a valid accord and satisfaction.

Cooper & Rock v. Y. & M. V. R. R. Co., 82 Miss. 634, 35 So. 162.

The facts as disclosed by this record show that the check was tendered in full satisfaction of all claims for disability benefits under the policies sued upon herein to February 1, 1934.

From a careful study of plaintiff's demurrer, it appears to us that his principal contention is that there was no consideration for the accord and satisfaction. Suffice it to say, that under the authorities in this state, when an amount smaller than that claimed to be due is offered in full settlement of a claim, and the offer is accepted by the creditor, this action constitutes a new contract which, upon its execution, is valid and binding on the parties. This new contract is valid and enforceable although there was no consideration, in the ordinarily accepted sense of the word, for it.

Greener & Sons v. Cain & Sons, 137 Miss. 33, 101 So. 859; Clayton v. Clark, 74 Miss. 499, 21 So. 565; Stovall v. Lampton Co., 174 Miss. 58, 164 So. 49; Jones v. McFarland, 173 So. 296, 178 Miss. 282.

Graham & Graham, of Meridian, for appellee.

In considering the authorities cited in appellant's brief, it will be necessary for the court to keep in mind the fact that this is not an entire contract but ten contracts in one representing $ 100 per month from May 1, 1933, to February 1, 1934, and that each monthly installment of $ 100 could have been sued for in a separate suit as each installment accrued, and likewise each one or any one of the installments, whether first, fifth or tenth, could have been tendered for a month specified and detailed and appellee would have been forced to accept same, even though there were other installments for other months that were still due and not tendered, which is a very different situation from one where the contract was an entirety and where a definite amount was tendered and accepted in full of the entire contract, which is the case in the authorities cited by counsel.

In order that the payment of a smaller sum than demanded shall operate as a satisfaction of the claim, it must be accepted as such. Where a person accepts a tender, but not in full of all demands, this acceptance will not conclude him from claiming more. The nature of the offer or tender by the debtor is an important consideration in determining whether there has been an acceptance and satisfaction.

Cooper & Rock v. Y. & M. V. R. R. Co., 86 Miss. 634, 35 So. 162.

If there had been no details furnished with the check nor in the letter responding to the telegram, then appellee might have been bound solely by what appeared on the check but certainly not when details and conditions were specially prepared by the appellant and sent with the check for the information of appellee as a basis of his action and upon which he did act.

There is absolutely no writing on the check, either front or back, which makes the check a payment in full because the "In full" on the back of the check is limited by what follows, to-wit: "As detailed on reverse side."

The payment of a sum admittedly due and payable furnishes no consideration for the discharge of an additional and distinct amount or item of liability, and does not effect an accord and satisfaction thereof.

I C. J S. 29 a (2), page 502; Dewees v. Bostick Lbr. & Mfg....