Opinion ID: 2612946
Heading Depth: 1
Heading Rank: 3

Heading: unless plaintiff can effectively avoid the accord and satisfaction, it is barred from maintaining a cause of action for breach of the underlying contract

Text: At trial Bank pled that the deed-in-lieu transaction constituted an accord and satisfaction. [15] The effect of an accord and satisfaction is to discharge the contractual obligations created by the original contracts [loan agreements]. Bank's accord-and-satisfaction defense required Morrow to plead affirmatively facts sufficient to support some legally tenable ground for avoidance of the binding force of its deed-in-lieu settlement with the Bank. [16] Settlement agreements are not impervious to effective and timely attacks and can be avoided under proper circumstances. [17] Here the Bank was exonerated of fraud, duress and breach of the implied covenants of good faith and fair dealing in its performance of the loan agreements, all of which exculpatory findings stand unassailed by the reviewing process that followed the nisi prius judgment. Under these circumstances Morrow no longer has any basis in law for avoiding the effect of the deed-in-lieu of foreclosure agreement with the Bank. Because the contractual obligations of both Bank and Morrow under the lending agreements were discharged by execution and performance of the deed-in-lieu settlement agreement, Morrow's cause of action for breach of contract is barred as a matter of law. Since the contractual obligations in suit have all been discharged, the trial court was duty-bound to enter judgment notwithstanding the verdict for Bank on Morrow's breach-of-contract claim. [18]