Houser v. Burchart & Levy

HART, J., (after stating the facts). (1) On the question of the application of the payment of the $700 check but little need be said. It is the settled rule of this court not to disturb on appeal the finding of fact made by a chancellor unless such finding is against the clear preponderance of the evidence. Tested by this rule, we can not say that the finding of the chancellor should be disturbed. It is true that both Mr. and Mrs. Houser testified that they directed the credit to be upon the mortgage indebtedness in order that the property might be released from the mortgage. On the other hand, a member of the firm to whom the payment was made testified in positive terms that the payment was made for the express purpose of being applied to the account so that Mr. Houser might purchase other goods. He is corroborated by the bookkeeper of the firm. The other circumstances also tended to corroborate Mm. Houser was beMnd in Ms account to the firm in an amount of over $1,300. He wished to purchase more goods with which to continue his business, and it was necessary that a payment should be made on his account to enable him to do so. When the $500 payment was made on the mortgage it was so noted on the check by which the payment was made. No such notation was made on the $700 check. This and other circumstances were proper to be considered by the chancellor in determining whether or not Houser directed the payment to be applied to the note or agreed that it might be applied upon his account which was unsecured. (2) By agreement of the parties the contract between Burchart & Levy and Houser made on the 1st day of November, 1910, in regard to the release of Houser was rescinded by the contract of November 10,1910. The parties to an accord and satisfaction may by a subsequent agreement rescind the same, and restore the debt to its original status. Heavenrich v. State (Minn.), 58 N. W. 982. In that case the court said: ‘ ‘ The findings of fact, including the sixth, as to which error is assigned, are fully sustained by the evidence. On those findings the only question is, can creditor and debtor, having made an accord and satisfaction, rescind the same, by a .subsequent agreement, so as to restore the debt to its original status, and so that it may be sued without reference to the accord and satisfaction, or the agreement rescinding it? We can conceive of no reason why they can not. It is true that by the accord and satr isfaetion, so long as it stands, the debt is extinguished. But when it is rescinded, matters stand as though it had never been made. ’ (3) In Feder v. Ervin, 38 S. W. 446, 36 L. R. A. 335, the Supreme Court of Tennessee held that when by mutual agreement a note which has been the subject of an accord and satisfaction is restored to the holder and notes and account^ received by him in satisfaction are returned to the other party, there is a rescission of the accord and satisfaction, and each party is restored to his original status. It follows that the decree must he affirmed.