An accord and satisfaction is binding upon both parties.
(Orig. Code 1863, § 2823; Code 1868, § 2831; Code 1873, § 2882; Code 1882, § 2882; Civil Code 1895, § 3736; Civil Code 1910, § 4330; Code 1933, § 20-1205.)
Law reviews.- For comment on Chocran v. Bell, 102 Ga. App. 617, 117 S.E.2d 645 (1960), see 24 Ga. B.J. 422 (1962).
JUDICIAL DECISIONSANALYSIS
Accord and satisfaction, to bind both parties requires meeting of minds as to subject matter embraced in agreement. State Farm Fire & Cas. Co. v. Fordham, 148 Ga. App. 48, 250 S.E.2d 843 (1978); Wallace v. Harrison, 166 Ga. App. 461, 304 S.E.2d 487 (1983).
An accord and satisfaction is itself a contract which requires a meeting of the minds in order to render it valid and binding. Commercial Union Assurance Co. v. Southeastern Ventilating, Inc., 159 Ga. App. 443, 283 S.E.2d 660 (1981).
All matters must be settled for accord.
- If there is no agreement to settle all matters in dispute, no accord and satisfaction results. Wallace v. Harrison, 166 Ga. App. 461, 304 S.E.2d 487 (1983).
There may be a pro tanto settlement of one or more of several claims, or of a portion of a claim consisting of one or more distinct elements, without prejudice to the remaining claims or portions of claims. Wallace v. Harrison, 166 Ga. App. 461, 304 S.E.2d 487 (1983).
Compromise or mutual accord and satisfaction binds both parties. Collier v. Casey, 59 Ga. App. 627, 1 S.E.2d 776 (1939).
Compromise and mutual accord and satisfaction immediately binds parties and terminates prior obligations and prior controversy between the parties insofar as subject matter therein compromised. J.A. Jones Constr. Co. v. Greenbriar Shopping Ctr., 332 F. Supp. 1336 (N.D. Ga. 1971), aff'd, 461 F.2d 1269 (5th Cir. 1972).
Effect of executed compromise and mutual accord and satisfaction not dependent upon complete and literal performance; rather, parties are relegated to their remedies thereunder. J.A. Jones Constr. Co. v. Greenbriar Shopping Ctr., 332 F. Supp. 1336 (N.D. Ga. 1971), aff'd, 461 F.2d 1269 (5th Cir. 1972).
Material mistake of fact, not resulting from negligence, may invalidate settlement agreement.
- It is generally agreed that settlement agreement based on mistake of material fact, where mistake was not due to negligence of party claiming mistake and where it did not pertain to fact in dispute, may be invalidated on that ground like other agreements. D.H. Overmyer Co. v. Joe Summers Roofing Co., 120 Ga. App. 188, 169 S.E.2d 821 (1969), later appeal, 121 Ga. App. 804, 175 S.E.2d 880 (1970).
Party cannot attack agreement on grounds of unilateral mistake.
- When final commission check to employee by employer was intended as a compromise and settlement of all claims between the parties, and when employer claimed that the employer subsequently discovered an overpayment in the amount of the check due to the employer's own mathematical error, the employee denying any such overpayment, employer could not attack the agreement on grounds of unilateral mistake. Mobley v. Fulton Roofing Co., 173 Ga. App. 563, 327 S.E.2d 540 (1985).
Mistake resulting from negligence of party to settlement contract will not render contract invalid. D.H. Overmyer Co. v. Joe Summers Roofing Co., 120 Ga. App. 188, 169 S.E.2d 821 (1969), later appeal, 121 Ga. App. 804, 175 S.E.2d 880 (1970).
Law of this state favors settlements and cessation of litigation. Coleman v. Ellenberg (In re Cohen), 6 Bankr. 708 (Bankr. N.D. Ga. 1980).
In equity, termination of family controversies affords consideration sufficient to support contract for such purpose. Fulford v. Fulford, 225 Ga. 9, 165 S.E.2d 848 (1969).
Law and equity not only allow but strongly encourage private settlements of family affairs. Trammell v. West, 224 Ga. 365, 162 S.E.2d 353 (1968).
Compromise of family claims is favored both in law and equity. Dickerson v. Dickerson, 19 Ga. App. 269, 91 S.E. 346 (1917).
Relinquishment of claims against each other effects accord and satisfaction regardless of respective amounts.
- When each of two persons relinquishes claim against the other, or each discontinues action against the other, mutual accord and satisfaction is effected, regardless of respective amounts involved; and this bars any further recourse on part of either as to such claims. Any rights of parties must now be based upon new agreement. Collier v. Casey, 59 Ga. App. 627, 1 S.E.2d 776 (1939).
Person who by renouncing one claim induces settlement of others is bound by settlement. Neal v. Field, 68 Ga. 534 (1882).
Settlement by guardian with third party concerning trust will accrue to benefit of ward. Smith v. Smith, 36 Ga. 184, 91 Am. Dec. 761 (1867).
Renewal note for less than old note, presumed to settle differences between parties.
- New note for sum less than old note, given in renewal thereof, is presumptive evidence that all differences between parties were adjusted and settled when such new note was given. Collier v. Casey, 59 Ga. App. 627, 1 S.E.2d 776 (1939).
Agreement on repair of defective construction work constituting compromise and mutual accord and satisfaction. See J.A. Jones Constr. Co. v. Greenbriar Shopping Ctr., 332 F. Supp. 1336 (N.D. Ga. 1971), aff'd, 461 F.2d 1269 (5th Cir. 1972).
Party relying on doctrine must show matter included.
- When settlement is pleaded as an estoppel, burden is upon party relying thereon to sustain plea by showing that particular matter was included in compromise. Glisson v. Burkhalter, 31 Ga. App. 365, 120 S.E. 664 (1923).
Burden of proof is on party relying on accord and satisfaction.
- Pleas of accord and satisfaction are pleas in confession and avoidance. Burden of pleading and proving existence, terms, and effect of accord and satisfaction is on party relying upon the accord and satisfication. City of Atlanta v. Gore, 47 Ga. App. 70, 169 S.E. 776 (1933).
When in defendant's answer and in defendant's motion for summary judgment, accord and satisfaction is defendant's sole legal theory, the burden of proof, as with any other affirmative defense, is on defendant, the party asserting this doctrine. Wallace v. Harrison, 166 Ga. App. 461, 304 S.E.2d 487 (1983).
When defendant moves for summary judgment and relies upon a line of cases which holds that the cashing of a check and retention of the proceeds constitutes an accord and satisfaction, regardless of any protest, oral or written, and regardless of whether the other party is given notice of protest or any purported reservation of rights, defendant thus undertakes to discharge a treble burden: not only that ordinarily imposed upon the proponent of an affirmative defense, but a second burden that requires the movant for summary judgment to establish that there exist no material issues of fact in the case, and yet a third that requires the movant who is also the defendant affirmatively to negate one or more essential elements of the case made out by the plaintiff. Wallace v. Harrison, 166 Ga. App. 461, 304 S.E.2d 487 (1983).
Jury to determine exact terms of compromise when evidence is conflicting. Murph Mach. Co. v. Burke, 19 Ga. App. 351, 91 S.E. 490 (1917).
Cited in Rogers v. Ball, 54 Ga. 15 (1875); Southern Ry. v. Dalton Tel. Co., 145 Ga. 189, 88 S.E. 940 (1916); Phillips v. Lindsey, 31 Ga. App. 479, 120 S.E. 923 (1923); Vann v. Kimbrel, 32 Ga. App. 275, 123 S.E. 168 (1924); Pere Marquette Ry. v. Tifton Produce Co., 48 Ga. App. 286, 172 S.E. 727 (1934); Stewart v. Finance Co., 49 Ga. App. 462, 176 S.E. 73 (1934); Eatonton Oil & Auto Co. v. Greene County, 181 Ga. 47, 181 S.E. 758 (1935); Mason v. Foster, 62 Ga. App. 104, 8 S.E.2d 180 (1940); Hall v. Beavers, 75 Ga. App. 722, 51 S.E.2d 879 (1949); Coggins v. Edmonds, 209 Ga. 381, 73 S.E.2d 199 (1952); Collins v. Louisville & W.R.R., 92 Ga. App. 814, 89 S.E.2d 908 (1955); McVay v. Anderson, 221 Ga. 381, 144 S.E.2d 741 (1965); Coldway Carriers, Inc. v. Hartman, 120 Ga. App. 787, 172 S.E.2d 205 (1969); Epps Air Serv., Inc. v. Lampkin, 125 Ga. App. 779, 189 S.E.2d 127 (1972); Sollek v. Laseter, 126 Ga. App. 137, 190 S.E.2d 148 (1972); Olivetti Leasing Corp. v. Metro-Plastics, Inc., 128 Ga. App. 401, 196 S.E.2d 686 (1973); Capital Auto. Co. v. Rick, 134 Ga. App. 830, 216 S.E.2d 601 (1975).
Compromise of Doubtful Claim
Compromise of doubtful question of law or fact provides sufficient consideration.
- When compromise contract is based upon bona fide dispute on doubtful question of either law or fact, there is sufficient consideration to support validity of contract. David v. Atlantic Co., 69 Ga. App. 643, 26 S.E.2d 650 (1943).
Settlement of doubtful issues provides sufficient consideration to support agreement of settlement and compromise. Fulford v. Fulford, 225 Ga. 9, 165 S.E.2d 848 (1969).
Compromise of doubtful claim is sufficient consideration to support promissory note fairly given in settlement of controversy. Cotterill v. Hopkins, 180 Ga. 179, 178 S.E. 444 (1935).
Compromise of doubtful rights are upheld by general policy, as tending to prevent litigation, in all enlightened systems of jurisprudence. Smith v. Smith, 36 Ga. 184, 91 Am. Dec. 761 (1867); David v. Atlantic Co., 69 Ga. App. 643, 26 S.E.2d 650 (1943).
When fairly made, courts always favor compromise of doubtful rights, and the compromises are binding notwithstanding it may eventually turn out that point of law was in favor of party complaining. David v. Atlantic Co., 69 Ga. App. 643, 26 S.E.2d 650 (1943).
To furnish consideration for compromise agreement, contention must be made in good faith and be honestly believed in. David v. Atlantic Co., 69 Ga. App. 643, 26 S.E.2d 650 (1943).
To render compromise of claim valid, the matter need not be really in doubt; it is sufficient if parties consider it so far doubtful as to make it subject of compromise. David v. Atlantic Co., 69 Ga. App. 643, 26 S.E.2d 650 (1943); Hall v. Beavers, 78 Ga. App. 722, 51 S.E.2d 879 (1949); Fulford v. Fulford, 225 Ga. 9, 165 S.E.2d 848 (1969).
Nature of disputed claim which will suffice as basis for accord and satisfaction.
- In accord and satisfaction of disputed claim it is not the merit of contentions of either party which determines its validity to support such accord and satisfaction, its controlling factor being bona fides of debtor's contention, which as a general rule is a question of fact for jury. Nauman v. McCoy, 84 Ga. App. 131, 65 S.E.2d 853 (1951).
Compromise of contention as to property rights, final outcome of which, if settled by litigation, parties consider to be doubtful, furnishes consideration sufficient to support compromise contract. David v. Atlantic Co., 69 Ga. App. 643, 26 S.E.2d 650 (1943); Fulford v. Fulford, 225 Ga. 9, 165 S.E.2d 848 (1969).
Promise made in extinguishment of doubtful claim is sufficient to support valid claim.
- The law favors compromises, and a promise made in extinguishment of doubtful claim is sufficient to support valid contract. Skinner v. Smith, 120 Ga. App. 35, 169 S.E.2d 365 (1969).
When debt in dispute, payment and acceptance of agreed sum constitutes accord and satisfaction.
- Agreement by creditor to receive less than amount of creditor's debt may be pleaded as accord and satisfaction when bona fide dispute arises between parties as to certain material terms of original contract and when such subsequent agreement is actually executed by payment of sum agreed upon. Nauman v. McCoy, 84 Ga. App. 131, 65 S.E.2d 853 (1951).
RESEARCH REFERENCES
Am. Jur. 2d.
- 15A Am. Jur. 2d, Compromise and Settlement, §§ 18, 37, 38.
C.J.S.- 17 C.J.S., Contracts, §§ 104, 118, 119, 208. 17A C.J.S., Contracts, §§ 231, 232, 411.
ALR.
- Failure to perform act required by new agreement as affecting character thereof as accord and satisfaction, 10 A.L.R. 222; 14 A.L.R. 230.
Surrender of, or forbearance to prosecute, a claim for damages for personal injuries or death as a consideration, 57 A.L.R. 279.
Agreement with one tortfeasor that any judgment that may be recovered will not be enforced against him, as affecting liability of cotortfeasor, 160 A.L.R. 870.
Admissibility of evidence of unperformed compromise agreement, 26 A.L.R.2d 858.
Family settlement of testator's estate, 29 A.L.R.3d 8.
Contempt for violation of compromise and settlement the terms of which were approved by court not incorporated in court order, decree, or judgment, 84 A.L.R.3d 1047.
CHAPTER 5 DEFENSES Article 1 General Provisions.- Excuse for nonperformance of contract for sale of goods, § 11-2-601 et seq.
JUDICIAL DECISIONS
Interference with contractual relationship when based on absolute right.
- There is no liability for interference with a contractual relationship when the alleged interference is caused by the exercise of an absolute right. J.C. Penney Co. v. Davis & Davis, Inc., 158 Ga. App. 169, 279 S.E.2d 461 (1981).
Distinction exists between interference with contractual rights and procuring or inducing another to breach the other's contract. First Mtg. Corp. v. Felker, 158 Ga. App. 14, 279 S.E.2d 451 (1981).
Failure of third person to perform independent prior contract made with one of the parties does not give rise to a cause of action for inducing the breach of the contract. First Mtg. Corp. v. Felker, 158 Ga. App. 14, 279 S.E.2d 451 (1981).
Caveat emptor is not a defense to action on warranty breach. Ben Trovato Properties, Inc. v. Strauss, 159 Ga. App. 510, 284 S.E.2d 632 (1981).
RESEARCH REFERENCES
ALR.
- Rights and remedies of one whose contract for a free or reduced service rate with public utility in consideration of a grant of property or privileges is nullified by public authority, 14 A.L.R. 252.
Validity of contract by agent for compensation from third person for negotiating loan or sale with principal, 14 A.L.R. 464.
Right of infant to recover back insurance premiums, 94 A.L.R. 965.
Agency: Anti-assignment clause in contract as precluding enforcement by undisclosed principal, 75 A.L.R.3d 1184.
Failure of building and construction artisan or contractor to procure business or occupational license as affecting enforceability of contract or right of recovery for work done - modern cases, 44 A.L.R.4th 271.
Credit card issuer's liability, under state laws, for wrongful billing, cancellation, dishonor, or disclosure, 53 A.L.R.4th 231.
ARTICLE 1 GENERAL PROVISIONS