Shawnee Sanitary Milk Co. v. Fulkerson's Garage & Mach. Shop

• Decision Date: 05 March 1935
• Citation: 79 S.W.2d 229,258 Ky. 639
• Parties: SHAWNEE SANITARY MILK CO. v. FULKERSON'S GARAGE & MACHINE SHOP.
• Court: Kentucky Court of Appeals

79 S.W.2d 229

258 Ky. 639

SHAWNEE SANITARY MILK CO. v. FULKERSON'S GARAGE & MACHINE SHOP.

Court of Appeals of Kentucky

March 5, 1935

Rehearing Denied April 23, 1935.

Appeal from Jefferson Circuit Court, Third Division, Common Pleas Branch.

Action by Fulkerson's Garage & Machine Shop against the Shawnee Sanitary Milk Company. Judgment for plaintiff, and defendant appeals.

Affirmed.

Dodd &amp Dodd, of Louisville, for appellant.

M Joseph Schmitt, of Louisville, for appellee.

REES Justice.

The appellee, William Arthur Fulkerson, doing business under the name of Fulkerson's Garage & Machine Shop, brought this suit against the Shawnee Sanitary Milk Company to recover the sum of $908.25 alleged to be due him for labor performed and materials furnished in repairing and rebuilding the bodies of certain automobile trucks owned by the milk company. He alleged that the work was done and the materials furnished pursuant to a contract entered into between him and the milk company on November 15, 1931.

The defendant's answer was a traverse, but in an amended answer it was affirmatively alleged that by the terms of a contract entered into between plaintiff and defendant on or about November 15, 1931, the plaintiff agreed to operate a repair shop for the defendant and to perform all the necessary labor in repairing the motor vehicles and other mechanical devices of the defendant, and that the defendant agreed, in consideration of the plaintiff performing these services, that it would pay him a flat rate of $125 a month and would pay for all parts used by him in making the repairs; that the plaintiff rendered the services contracted to be performed by him up to and including September 16 1932, and that the defendant paid the plaintiff $125 a month pursuant to the terms of the contract, or a total of $1,258.63; that on or about September 16, 1932, a controversy arose between the parties because of plaintiff's claim that the contract which provided that he should receive $125 a month did not include services rendered by him in repairing the bodies of automobiles, but was for repairs on the chassis and mechanical parts of the automobiles only; that on October 3, 1932, the defendant executed and delivered to the plaintiff its check for the balance due for his services at the rate of $125 a month, and indorsed on the front of the check was the following: "Account in full"; that the plaintiff accepted, indorsed, and cashed the check, and thereby released the defendant from any and all liability.

By agreement the amended answer was controverted of record. On the trial of the case the jury returned a verdict for the plaintiff for the full amount claimed, and from the judgment entered thereon the defendant has appealed.

It is appellant's contention that the circuit court erred in overruling its motion for a peremptory instruction, since there was a controversy between the parties over the amount due to the plaintiff under the contract and the acceptance by the plaintiff of the check indorsed "Account in full" operated as full accord and satisfaction of the indebtedness.

The general rule is that, if the claim is unliquidated and disputed, the acceptance by the creditor of a check bearing the notation, "Account in full," or employing words of similar import, shows an acquiescence in the amount offered and constitutes an accord and satisfaction of his claim. Alcorn v. Arthur, 230 Ky. 509, 20 S.W.2d 276; Cunningham v. Standard Construction Co., 134 Ky. 198, 119 S.W. 765; Schnell v. Perlmon, 238 N.Y. 362, 144 N.E. 641, 34 A. L. R. 1023; Pitts v. National Independent Fisheries Co., 71 Colo. 316, 206 P. 571, 34 A. L. R. 1033; Root & Fehl v. Murray Tool Co. (Tex. Com. App.) 26 S.W.2d 189, 75 A. L. R. 902.

On the other hand, it is the general rule that part payment of a liquidated and undisputed indebtedness, though accepted by the creditor with knowledge that it was intended to be in full payment, is not an accord and satisfaction, since the part payment is not a consideration for the discharge of the balance. Lewis v. Browning, 223 Ky. 771, 4 S.W.2d 734; Sherman v. Pacific Coast Pipe Co., 60 Okl. 103, 159 P. 333, L. R. A. 1917A, 716; Whittaker Chain Tread Co. v. Standard Auto Supply Co., 216 Mass. 204, 103 N.E. 695, 51 L. R. A. (N. S.) 315, Ann. Cas. 1915A, 949; 1 R. C. L. 184; Vol. 2 Restatement, Contracts, § 420, illustration C.

The facts in the instant case make the latter rule applicable. It is conceded by both parties that appellee was to receive $125 a month, and that, when the employment ended on September 16, 1932 the appellant was indebted to him in the sum of $46.32. The check with the notation thereon. "Account in full," which was delivered to appellee and cashed by him, was for that amount. The appellee claimed that appellant was indebted to him in the further sum of $908.25 for additional services performed and materials furnished not included in the contract providing compensation at the rate of $125 a month for the labor performed on the chassis of appellant's motor vehicles. The amount due appellee under the contract for labor at the rate of $125 a month was liquidated and undisputed. The appellee claims that there was an additional contract for payment for services rendered and materials furnished in repairing and rebuilding the bodies of appellant's motor vehicles. The appellant was under a legal duty to appellee to pay the amount admitted to be due, and his performance of that duty was no consideration for the discharge of another debt about which there was a dispute.

In Louisville, N. A. & C. Railway Co. v. Helm & Bruce, 109 Ky. 388, 59 S.W. 323, 325, 22 Ky. Law Rep. 964, Helm & Bruce were the local counsel for the railway company, and a controversy arose over the amount of attorney fees in what was known as the "Beattyville bond cases." The amount was fixed by agreement at $3,500. The plaintiffs had rendered legal services to the defendant in other cases. The defendant sent to the attorneys a check and voucher for $3,500. The voucher recited that the $3,500 was in payment for services in the "Beattyville bond cases," and was in full payment of all claims for legal services rendered to the defendant to that date. The plaintiffs cashed the...