Reilly v. . Barrett

This action was brought to recover damages for personal injuries caused by the alleged negligence of the defendant. As an affirmative defense a supplemental answer alleged "That on or about the 16th day of August, 1912, the defendant, in good faith, served his verified answer to the complaint herein denying generally the validity of the plaintiff's claim, and thereafter, and on or about the 10th day of December, 1913, an agreement was made between the plaintiff and the defendant, through their respective attorneys, by which the defendant agreed to pay to the plaintiff in full settlement of the cause of action set forth in the complaint the sum of two hundred dollars, and the plaintiff, in consideration thereof, agreed to accept the said sum in full settlement of the action, and upon the payment thereof to discontinue the action without costs." The answer then alleges tender of the sum of two hundred dollars to the plaintiff and his refusal to accept the same; and the continued readiness of the defendant to pay over such sum to the plaintiff.

The sufficiency of this defense was challenged by the demurrer, and the sole question in this court is whether the decision of the Special Term, affirmed by the Appellate Division, sustaining such demurrer is correct.

An agreement whereby one party undertakes to give or perform, and the other to accept in settlement of an existing or matured claim something other than what he believes himself entitled to, is an accord. The execution of such an agreement is a satisfaction.

An accord, when followed by satisfaction, is a bar to the assertion of the original claim. Until so followed it it has no effect.

The fact that the original claim is based on contract or in tort is immaterial. Either may be barred by accord and satisfaction. So it is whether the claim is liquidated or unliquidated, except that in the former case certain principles as to consideration are enforced which are not applicable to the latter.

These rules apply to every such transaction. It may be called a compromise. But whatever the name given the original claim is not barred until the satisfaction is completed. (Kromer v. Heim,75 N.Y. 574; Brooklyn Bank v. De Grauw, 23 Wend. 342.)

The satisfaction contemplated by the accord may involve the payment of money or the delivery of property. Or the creditor may agree to accept the debtor's promise itself in satisfaction rather than the performance of this promise. (Kromer v. Heim,supra.)

In any event the defendant who seeks to set up this defense as a bar to the original action must allege and prove both the accord and the satisfaction. If his claim be that his promise was accepted in satisfaction, that he must plead. The burden is upon him to show the existence of a bar. (Babcock v. Hawkins,23 Vt. 561.)

The answer clearly shows an executory agreement by which the defendant agreed, within a reasonable time, to pay the plaintiff the sum of two hundred dollars, and by which the plaintiff agreed to accept that sum when tendered in settlement of the action, and thereupon to discontinue such action without costs. There is no allegation that the defendant's promise was to be received in satisfaction, and no facts pleaded from which such an inference can be drawn. The answer is, therefore, defective in that it pleads only an accord.

The plaintiff relies upon Bandman v. Finn (185 N.Y. 508). But, as is clearly pointed out, that was the case of a creditor holding an unmatured and contingent obligation agreeing with his debtor for the surrender of the obligation. The authority ofKromer v. Heim is not weakened and it has been cited as late as Mance v. Hossington (205 N.Y. 33).

The judgment appealed from should be affirmed, with costs.

HISCOCK, Ch. J., CHASE, COLLIN, POUND and McLAUGHLIN, JJ., concur; CARDOZO, J., absent.

Judgment affirmed.