Besco Enterprises, Inc. v. Carole, Inc.

[43]

BROWN (H. C.), J.

The sole question presented is whether the trial court erred in holding that the retention of a check by appellant, sent as payment in full, constituted an accord and satisfaction, even though appellant did not cash the check and gave prompt notice that it would not be acceptable, as full satisfaction of the obligation.

Besco Enterprises, Inc. (Besco), is a retail merchant operating jewelry sales concessions in discount houses. Carole, Inc. (Carole), a wholesaler of costume jewelry, was supplying costume jewelry to Besco prior to 1962. In September 1962, the parties ended this business relationship and orally agreed that Besco would return to Carole certain merchandise. Upon return of the merchandise, a dispute arose as to the amount of money Carole was obligated to pay to Besco.

On June 27, 1963, Carole sent to Besco an uncertified check for $2,370.88, together with a letter stating that the check was in full payment, and a detailed accounting showing the calculation of the amount tendered. On July 1, 1963, Besco responded with a letter which stated in part:

uThe deductions shown

[on]

your statement of account, dated June 27,

1963,

are incorrect, and improperly taken, therefore, we are holding your check in the amount of

$2,370.88,

as we cannot accept this check as presented.”

(Italics added.)

Besco did not return or offer to return Carole’s cheek but retained it. The check was not cashed or certified by Besco. Its return was not requested by Carole nor did Carole inform Besco that the cheek was being kept covered or payment stopped.

Besco commenced action on July 27, 1964, 13 months after receiving the check. The action was to recover $9,347.40 for merchandise returned.

The trial court found that Besco would have been entitled to this sum plus interest had it not retained the check for $2,370.88, which retention constituted an accord and satisfaction.