Brief Fact Summary. Burger Dairy Co., (Appellee), contracted with McMahon Food Corporation, (Appellant) for the sale of milk products. A dispute arose over a debt accrued by Appellant and Appellant brought suit claiming the dispute was resolved through an accord and satisfaction. Appellant appeals the trial court ruling that the accord was and satisfaction was obtained through deceit.
Synopsis of Rule of Law. Pursuant to good faith requirement of U.C.C. Section:3-311(a), it follows that there can be no accord and satisfaction unless there was an honest dispute between the parties as to the amount due at the time payment was tendered
Issue. Whether, Appellee’s acceptance and negotiation of the check completed the accord and satisfaction.
Held. No. No accord and satisfaction exists because there was no honest dispute between the parties as to the amount due at the time payment was tendered.
Discussion. The trial court found that McMahon deliberately misled Carter who did not know the specifics of his predecessor’s dealings with Appellant. The trial court also found that McMahon was acting dishonestly and taking advantage of Carter at the time he tendered payment. Therefore Appellant failed to meet the good faith requirement under U.C.C. Section:3-311(a) because at the time payment was tendered there was not an honest dispute between the parties as to the amount due.