Opinion ID: 846741
Heading Depth: 1
Heading Rank: 2

Heading: substantive facts and procedural history

Text: This case centers on a contract to remodel and reconstruct a lakeside residence in Edwardsburg, Michigan, [1] made between plaintiff, Hoerstman General Contracting, Inc., and defendants Juanita and Ronald Hahn, the owners. Unfortunately, several unforeseen events during construction caused significant delay and cost overruns. When plaintiff did not meet the expected deadline to complete the work, Ronald Hahn informed plaintiff's owner that he wanted the job finished no matter the expense. Plaintiff agreed to work under these conditions if Ronald agreed to pay the extra costs. Ronald made it clear that he was not concerned with the price. Plaintiff followed Ronald's oral instructions on changes to the project. These were not minor modifications. They included moving walls and tearing up concrete floors. According to plaintiff, a later-compiled written list of the oral changes to the contract covered over ten pages. Despite these significant alterations, Ronald refused to agree in writing to any changes to the existing contract. Defendants acknowledged that they owed more than the original bid price and paid plaintiff $125,000. But plaintiff claimed defendants owed an additional $32,750. In an apparent attempt to settle the dispute, plaintiff sent a letter to defendants asking for $16,910.79. Plaintiff indicated that it would provide the lien waiver and close the account in exchange for payment of the amount requested. Defendants did not pay the $16,910.79. Instead, they replied with a letter in which they calculated the balance due at $5,144.79. They included with the letter their check for that amount. They wrote final payment on the check. In the letter, they indicated that they believed that their payment of $5,144.79 closed the account. The letter provided: If we send you a check for $5144.79 we will consider this account closed and will not expect discussion of the other  items.[ [2] ] We will then expect the lein [sic] waiver to be sent. If this is not acceptable, we will have to resort to arbitration per attorney [sic]. Plaintiff sought legal advice. Its attorney crossed out the words final payment on the check and advised plaintiff to deposit it. Plaintiff followed this advice, credited defendants' account in the amount of $5,144.79, and did not close the account. When defendants made no additional payments, plaintiff brought suit seeking damages and foreclosure of its construction lien. Defendants counterclaimed for amounts they believed they had overpaid. In their answer to plaintiff's complaint, defendants asserted the affirmative defense of accord and satisfaction. After a bench trial, the court awarded plaintiff approximately $26,000 after setting off $5,800 on defendants' counterclaim. The court did not explicitly rule on the issue of accord and satisfaction. Both parties appealed to the Court of Appeals. The Court of Appeals ruled that the words final payment on the check were not sufficient to inform plaintiff that acceptance of the check discharged the entire claim. Hoerstman Gen Contracting, Inc v. Hahn, unpublished opinion per curiam of the Court of Appeals, issued June 15, 2004 (Docket No. 244507), 2004 WL 1335893. This Court granted leave to appeal limited to whether an accord and satisfaction occurred in this case. 472 Mich. 898, 696 N.W.2d 708 (2005).