Peckham Industries, Inc. v. A. F. Lehmann

• Decision Date: 30 October 1975
• Citation: 374 N.Y.S.2d 144,49 A.D.2d 172
• Court: New York Supreme Court — Appellate Division
• Parties: PECKHAM INDUSTRIES, INC., Respondent, v. A. F. LEHMANN, doing business as Lehmann Construction Co., Appellant, and Fidelity & Deposit Co. of Maryland et al., Defendants.

Page 144

374 N.Y.S.2d 144

49 A.D.2d 172

PECKHAM INDUSTRIES, INC., Respondent, v. A. F. LEHMANN, doing business as Lehmann Construction Co. Appellant, and Fidelity & Deposit Co. of Maryland et al., Defendants.

Supreme Court, Appellate Division, Third Department.

Oct. 30, 1975.

Daniel J. Smitas, Albany, for appellant.

Alex Wiltse, Catskill, for respondent.

Before GREENBLOTT, J.P., and KANE, KOREMAN, LARKIN and REYNOLDS, JJ.

GREENBLOTT, Justice Presiding.

Defendant, a contractor, purchased materials and rented equipment from plaintiff. Defendant sent plaintiff a check in the amount of $3,463.07 on November 14, 1969. The face of the check was broken down to show specific payments for various items and it contained a statement 'Paid in Full'. Up to that point, defendant had received a bill for the material, but had not been billed for the equipment, since these items had been provided to defendant by different subsidiaries of the plaintiff, and plaintiff's office manager testified that different billing procedures were involved. Defendant's check thus included the amount which it believed to be due to plaintiff for rental of the equipment. The reverse side of the check also contained a notation 'Paid in full for Wittenburg State project on this date 11--14--69'. An accounts receivable clerk endorsed the check and deposited it, contrary to office policy, according to the testimony of plaintiff's office manager, and the check was marked paid on the 18th of November. The office manager discovered what had occurred on the 20th of November and immediately called plaintiff's bank and had the check returned. The record reveals that both plaintiff's and defendant's accounts at their respective banks were adjusted sometime around November 21 to reflect the fact that defendant's check had not been debited against his account and credited to the account of plaintiff. On December 1, plaintiff returned the check to defendant with a letter refusing to accept the sum tendered as payment in full. Plaintiff contends that it was owed $4,027.10 by defendant.

The jury rendered a special verdict and answered in the nagative the question whether defendant did offer and plaintiff did knowingly accept the sum of $3,463.07 in full satisfaction of an amount owed by defendant to plaintiff and honestly disputed. Defendant contends on this appeal that plaintiff's endorsement and depositing of the check constituted an accord and satisfaction as a matter of law, and cites many cases in which it was held that acceptance of payment of a lesser sum under circumstances where the...