Opinion ID: 348571
Heading Depth: 1
Heading Rank: 3

Heading: Acceptance of Tender

Text: 25 The district court based its holding that Ascot and Cunningham were jointly and severally liable to plaintiff on a finding that Ascot had accepted a tender of the lease interests from Buchanan. Tender of unregistered securities and any income received on them to the seller is a prerequisite to recovery by a buyer under section 507(a)(1). Ind.Code § 23-2-1-19(a)(1) (Ind.Ann.Stat. § 25-873(a)(1), Burns, 1972). Buchanan's lawyer, James A. McDermott, carried an assignment of the lease interests and a sum covering income received on them to the office of Ascot's lawyer, John A. Spinuzzi, in Dallas, Texas. Spinuzzi acknowledged Buchanan's tender and stated that he would inform McDermott on or before November 15, 1974, about whether Ascot would accept or reject the tender. Spinuzzi mailed the assignment and the sum tendered back to McDermott on May 14, 1975, about a month after the original complaint in this action was filed. McDermott immediately returned the assignment and sum to Spinuzzi with a letter stating that Ascot had accepted Buchanan's tender by failing to notify Buchanan of its rejection by November 15, 1974. 26 It is undisputed that Buchanan met the tender requirement for the purpose of obtaining recovery under section 507(a)(1). However, Ascot and Cunningham challenge the district court's holding that they are liable to plaintiff on the basis of an acceptance of tender by Ascot. Specifically, they contend (1) that plaintiff may not recover on a breach-of-contract theory when none was stated in the complaint; (2) that Cunningham cannot be held liable on the basis of an acceptance of tender by Ascot; and (3) that Spinuzzi lacked authority under Texas law to enter into a contract on Ascot's behalf. 27 We need not address these questions. Because Ascot and Cunningham are liable under the Indiana Securities Law for the full amount claimed by plaintiff, an acceptance of tender by Ascot has no apparent legal significance in this case. We reject the district court's conclusion that Ascot's acceptance of tender constituted an accord and satisfaction of the plaintiff's claims under the Indiana Securities Law. An accord is an agreement to compose or settle, and the satisfaction is the execution of the agreement. Karvalsky v. Becker, 217 Ind. 524, 533, 29 N.E.2d 560, 563 (1940). Assuming for present purposes that Spinuzzi's failure to timely reject Buchanan's tender constituted an accord, it is nevertheless clear that the contract created has not been executed. Buchanan's tender implied an offer to rescind the contracts by which he purchased the lease interests and to accept the consideration he had paid for them. While Ascot may have impliedly agreed to rescind the contracts by failing to reject the tender, it has not repaid Buchanan the consideration it received from the sales. An accord without satisfaction does not discharge the original obligation. Karvalsky v. Becker, supra; Jackson v. Olmstead, 87 Ind. 92, 94 (1882); 6 A. Corbin, Contracts § 1269 at 76 (1951). 2 The statutory liability of Ascot and Cunningham therefore was not extinguished by Ascot's acceptance of tender. Ascot and Cunningham remain jointly and severally liable to plaintiff under the Indiana Securities Law. 28 Finally, appellants assert that the district court improperly awarded attorneys' fees on the basis of its finding that Ascot had breached the tender contract. An award of reasonable attorneys' fees is authorized by section 507(a)(1) of the Indiana Securities Law, Ind.Code § 23-2-1-19(a)(1) (Ind.Ann.Stat. § 25-873(a)(1), Burns 1972), under which we have determined the appellants were and still remain liable. The award was a proper exercise of the court's power under that section.