Court Opinion

ID: 6290476
Source: CourtListenerOpinion
Date Created: 2022-02-18 16:59:18.80921+00
Date Added: 2024-06-11T09:00:20.976606
License: Public Domain

Dissenting Opinion by
Packel, J.:
The plaintiff’s action on a book account for goods sold was successful as to its claim for some $4,000, but was concluded with a finding of $22,800 against it on a counterclaim based on an alleged oral contract to pay commissions.
The oral contract for commissions was allegedly made in early 1966. Sales to the third party commenced three or four months later. In June of 1967 the plaintiff commenced its action against the defendant. Prior to filing an answer, the defendant delivered to the plaintiff eight checks, each for $500. Four checks payable in September, October, November and December of 1967 were honored, but payment was stopped on the remaining four checks. The record shows that prior to December of 1967, the defendant never made a claim for commissions. The defendant, in its counterclaim filed on April 20, 1968, alleged that the plaintiff had agreed to pay it 7%% of net profits on sales to a third party but at the trial it amended the counterclaim to allege that the commission was to be 7%% on gross sales instead of net profits. The plaintiff denied there was any agreement to pay defendant a commission.
*236The defendant’s counterclaim made the following averment: “6. Defendant and Plaintiff agreed that the said indebtedness of $15,000.00 would be compromised, and Plaintiff would discontinue the within action and pay to Defendant the sum of $2591.15, representing the compromise figure minus the balance of the claim against Defendant, which is more particularly set forth in Plaintiff’s Complaint.” Notwithstanding that averment, the defendant claimed in paragraph 7 its right to disregard the agreement and to recover the full amount of its alleged original claim.
The court below, in its en banc opinion and order, states that: “. . . counterclaimant’s attempt to compromise the plaintiff’s debt in no way precludes his right to insist on performance in accordance with the terms of the agreement. The Court deems efforts to compromise between the parties as mere negotiations, failing fruition, and accordingly of no legal significance.” However, the counterclaim, as quoted above, avers not an attempt to compromise but in fact avers that a compromise was agreed upon. The appropriate rule, therefore, is the black letter of Section 418 of the Restatement on Contracts, which provides: “A subsequent contract may itself be accepted as immediate satisfaction and discharge of a pre-existing contractual duty, or duty to make compensation; and if so accepted the preexisting duty is discharged and is not revived by the debtor’s breach of the subsequent contract.” Since the defendant’s counterclaim alleged an agreement under which $2,591.05 was the net amount due it, that is the maximum amount recoverable by it, together with interest from December of 1967.
The judgment for $22,800 should be reversed and the case remanded for appropriate action in accordance herewith.