Plaintiff, Rust Scaffold Rental and Erection, Inc., appeals the granting of a summary judgment in favor of defendants, Grimaldi Construction, Inc. and C.R. Pittman Construction Company, Inc., A Joint Venture, ("Grimaldi/Pittman"), and Aetna Casualty Insurance Company ("Aetna"). We reverse and remand for trial on the merits.
The facts of this case are as follows: In 1994, Grimaldi/Pittman, as general contractor, entered into a building contract with River City Joint Venture for the construction of improvements on the River City Casino Site in New Orleans. Plaintiff entered into a subcontract with Grimaldi/Pittman to provide labor and scaffolding for this job. Plaintiff also entered into a subcontract with George M. Raymond Co. ("Raymond") to provide labor and materials for the River City Riverboat Terminal. On April 10, 1996, plaintiff filed a petition to enforce a laborers' and materialmen's lien and named as defendants River City, Grimaldi/Pittman, Raymond and Aetna.
According to plaintiff, Rust Scaffold Services, Inc. is the holding company for plaintiff, Rust Scaffold Rental and Erection, Inc. ("Rust Erection"), its union subsidiary, and for Rust Scaffold Builders, Inc. ("Rust Builders"), its non-union subsidiary.
It is undisputed that a $7,872.60 check dated September 26, 1996 from Grimaldi/Pittman was paid to the order of Rust Scaffold Rental and Erection Inc. and contained
Grimaldi/Pittman and Aetna filed a motion for summary judgment asking that plaintiff's claims against them be dismissed because there had been a valid compromise and settlement of those claims. In support of its motion, Grimaldi/Pittman and Aetna relied on the affidavits of Michael Pittman, a representative of C.R. Pittman Construction Company, Inc., and August Grimaldi
The trial judge granted the motion for summary judgment, but did not give reasons. This appeal by plaintiff followed.
Code of Civil Procedure Article 966 was amended by the legislature in 1996. Subsequently, there was disagreement among the various courts of appeal as to the intent of the legislature with respect to those amendments. In response, the legislature again amended article 966 in 1997 to provide that all decisions inconsistent with the Third Circuit case of Hayes v. Autin, 96-287 (La.App. 3 Cir. 12/26/96), 685 So.2d 691, writ denied, 97-0281 (La.3/14/97), 690 So.2d 41, would be legislatively overruled. Subsequent to those 1997 amendments, our colleagues of the Second Circuit, in Berzas v. OXY, USA, Inc., 29,835 (La.App. 2 Cir. 9/24/97), 699 So.2d 1149, gave a succinct and comprehensive analysis of the current status of the summary judgment procedure. The court stated:
Code of Civil Procedure Article 967 states, in part: "When a motion for summary judgment is made and supported as provided above, an adverse party may not rest on the mere allegations or denials of his pleadings, but his response, by affidavits or as otherwise provided above, must set forth specific facts showing that there is a genuine issue for trial. If he does not so respond, summary judgment, if appropriate, shall be rendered against him." In accordance with these now settled procedural rules we now address and decide the merits of this appeal.
Plaintiff contends that the trial court erred in concluding that when The First National Bank of Chicago deposited the check with the restrictive endorsement, it constituted an accord and satisfaction of the entire debt owed by Grimaldi/Pittman to plaintiff. Plaintiff argues that there are genuine issues of unresolved material fact which require a trial on the merits. Plaintiff claims that Roberts' affidavit established that she intended to settle only the account Grimaldi/Pittman had with Rust Builders and that she did not have the authority to settle the Grimaldi/Pittman account with Rust Erection. Furthermore, plaintiff argues that The First National Bank of Chicago did not have the authority to accept a tender of compromise and settlement on behalf of Rust Erection and that in depositing this check, The First National Bank of Chicago violated established procedures and its principal's instructions.
In Orgeron v. Security Industrial Funeral Homes, Inc., 96-2127, p. 3-4 (La.App. 4 Cir. 2/26/97), 690 So.2d 243, 245, we stated:
The defendant has the burden of proving the elements of the defense of accord and satisfaction. See, Anesthesia East, Inc. v. Bares, 594 So.2d 1085 (La.App. 4th Cir. 1992). Grimaldi/Pittman relies on the fact that the check with the restrictive endorsement was negotiated and on August Grimaldi's statement in his affidavit that Shannon Roberts told him that the amount of $7,872.60 would be acceptable as full and final settlement of all amounts owed by Grimaldi/Pittman to Rust Erection on the River City Casino project.
Although the restrictive endorsement language on the check and its subsequent negotiation does give rise to a strong presumption that Grimaldi/Pittman's offer to settle its account with Rust Erection was accepted, plaintiff has countered that presumption with equally strong evidence that acceptance was not intended. Plaintiff's evidence includes the affidavits of Shannon Roberts and Wayne Barbin which attest that Grimaldi/Pittman owed money to both Rust Erection (the plaintiff herein) and Rust Builders, and that the amount owed to the plaintiff was substantially more than that owed to Rust Builders. Roberts stated that she only intended to settle the account Grimaldi/Pittman had with Rust Builders' Kenner office and that this account was the only one she had the authority to settle. Roberts states that she did not even know of the existence of the Rust Erection account until October, 1996. She states that her position in 1996 was credit manager of the Rust Builders' Kenner office.
Barbin's affidavit states that he was the regional credit manager of Rust Erection in 1996 and that, at no time, did he authorize Shannon Roberts to settle Grimaldi/Pittman's account with Rust Erection. He also states that no one with Rust Services, Rust Erection or Rust Builders authorized a settlement of all accounts of Grimaldi/Pittman relating to the River City Casino project.
The credibility of the above evidence is bolstered by the fact that the check in question is dated September 26, 1996, over two months after Grimaldi/Pittman answered plaintiff's lawsuit, yet there is no evidence suggesting either party's attorney was involved in the alleged compromise. In fact, it appears that the negotiations were pursued solely by Ralph Grimaldi and Shannon Roberts. This observation, when considered with the opposition affidavits, convince us that there are unresolved factual issues regarding to which account the payment was to be applied. Certainly, it would be reasonable to assume that the compromise of a claim in excess of $71,000.00 for the sum of $7,872.60, after a lawsuit had been filed, would entail more documentation than simply a check with a restrictive endorsement.
Furthermore, contrary to defendants' arguments, this case is distinguishable from those cited in defendants' brief, i.e. Charles X. Miller, Inc. v. Oak Builders, Inc., 306 So.2d 449 (La.App. 4th Cir.1975), (the company president personally negotiated the instrument offered in full settlement); Harmon v. Simon, 624 So.2d 981 (La.App. 3rd Cir.1993), (checks tendered for a lesser amount than requested and accompanied by letters clearly expressing that fact were personally accepted and negotiated by payees); Didriksen v. Sewerage and Water Board of New Orleans, 527 So.2d 319 (La.App. 4th Cir.1988), writ denied, 532 So.2d 770 (La. 1988), (nine checks containing restrictive endorsement sent by same party and negotiated over ten month period by clerk employed by creditor). Of these three cases, only the Didriksen case was decided on a motion for summary judgment; the other two involved full trials on the merits.
Accordingly, for the reasons assigned, we reverse the grant of summary judgment and remand for further proceedings.