Court Opinion

ID: 9465900
Source: CourtListenerOpinion
Date Created: 2023-08-05 00:59:24.736466+00
Date Added: 2024-06-11T17:39:26.247299
License: Public Domain

K. K. HALL, Circuit Judge,
concurring in part and dissenting in part:
I concur in Part II of the majority opinion regarding the duties of a railroad as common carrier under § 20(11) of the Interstate Commerce Act, 49 U.S.C. § 20(11). However, I think the majority has improperly considered the accord and satisfaction issue in Part I. The parties intended that the railroad’s payment of salvage proceeds would be an accord and satisfaction for Masonite’s aggregated claims, liquidated and unliquidated. Masonite should be bound to its bargain, and accordingly, I respectfully dissent.
I.
The documents at issue show that an accord. and satisfaction of all Masonite’s claims was reached by the parties.
On November 1, 1973, Masonite filed a claim with the railroad alleging that N&W owed it $6,786.08, the full value of its goods which had not been delivered in good condition. On August .1, 1975 N&W refused to pay any amount on this claim, even salvage sale proceeds of $1500.00, until Masonite conceded that N&W was not liable for damage to the improperly packed goods. This was N&W’s position throughout the parties’ correspondence.
On August 15, 1975, Masonite proposed a counteroffer in threatening terms. It alluded to other damages which would increase its claimed losses to $20,000. It asserted that N&W had mishandled the salvage sale and should have realized $5,000 instead of $1,500. Masonite concluded by proposing “a full settlement of this claim for $5,000.00” (emphasis added) and made a clear threat to litigate “to assure full and fair restitution to Masonite Corporation.”
N&W would not relent and Masonite wrote another letter on January 15, 1976, referring to N&W’s letter of August 1, 1975. Significantly, Masonite did not refer to its earlier letter containing the counteroffer. It wrote: “We would like to amend our claim dated November 1, 1973, for $6,786.08, and adjust it to the $1,500.00 for the full salvage value of the board. Upon receipt of your check of $1,500.00, we will close our claim against Norfolk & Western.” (Emphasis added)
These documents clearly evidence an intent on Masonite’s part to accord and satisfy all of its claims against N&W. In reaching a different conclusion, the majority refers to conclusory testimony by a Masonite employee who stated in response to three cursory questions, that Masonite’s total claims were for $6,786.08, and some $5,200 was still due and owing. Of course, resort to extrinsic evidence is improper when documents are unambiguous. Their clear meaning should be given effect. See Chenango Bridge Co. v. Binghamton Bridge Co., 3 Wall. (U.S.) 51, 18 L.Ed. 137 (1866). Compounding its error, the majority cites the “clearly erroneous” standard of Fed.R.Civ.P. 52(a) in affirming the district court’s judgment against N&W on this issue. The parties did not present extrinsic evidence and the district court did not rely on or even refer to any extrinsic evidence in construing the documents. The “clearly erroneous” rule does not apply where we review the lower. court’s legal interpretation of documents. Our view of these documents is as good as the district court’s view. See Nalle v. First National Bank of Baltimore, 412 F.2d 881, 884 (4th Cir. 1969).
In my view, the district court’s interpretation of the documents is' contrary to the clear language therein. I would reverse and hold as a matter of law that the documents show, with no ambiguity, an accord and satisfaction of all Masonite’s claims.
*730II.
The majority holds that, even if the parties intended to reach an accord and satisfaction of Masonite’s claims, they can not be bound to the. bargain because no consideration supports it. This is simply not the law.
[T]he cases are many in which it has been held that where an aggregate amount is in dispute, the payment of a specified sum conceded to be due, that is, by including certain items but excluding disputed items, on condition that the sum so paid shall be received in full satisfaction, will be sustained as an extinguishment of the whole.
Chicago M. & St. P. R. Co. v. Clark, 178 U.S. 353, 367, 20 S.Ct. 924, 929, 44 L.Ed. 1099 (1900) (collecting cases).
Masonite elected to negotiate for an aggregate sum to be paid upon the railroad’s concession of liability. The railroad refused to make payment, and Masonite threatened to litigate the matter unless negotiations produced a satisfactory settlement. The railroad made payment, as a settlement of the aggregate claim, and Masonite accepted that payment. This business bargain should be enforced.
The general principle applicable to settlements [is]: . . the largest number of controversies between business men are ultimately settled by the parties themselves; and when there is no unfairness, and all the facts are equally known to both sides, an adjustment by them is final and conclusive. Oftentimes a party may be willing to yield something for the sake of a settlement; and if he does so with a full knowledge of the circumstances, he cannot affirm the settlement, and afterwards maintain a suit for that which he voluntarily surrendered.
Id. at 369, 20 S.Ct. at 930 (citations omitted).
The harshness to which the majority alludes does not exist. Enforcement of the accord and satisfaction will not allow common carriers to invariably bully shippers into settling distinct liability claims in return for immediate payment of salvage sale proceeds. Here, the shipper initiated the bargain by choosing to negotiate for a single immediate payment in settlement of all its claims, as an alternative to litigation. The payment N&W agreed to make may have been less than Masonite hoped to obtain, but the fact remains that Masonite accepted the proffered payment in settlement of its whole claim.
III.
Accordingly, I would reverse the district court on both of its alternative holdings that the parties did not reach accord and satisfaction of Masonite’s liability claim and that, if such agreement was reached, it was not supported by consideration. I respectfully dissent from the majority’s opinion in Part I, but concur in Part II.