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McMahon Food Corp. v. Burger Dairy Co.

United States Court of Appeals for the Seventh Circuit
103 F.3d 1307 (1996)


Facts

McMahon Food Corp. (MFC) (plaintiff) initially sued Burger Dairy Co. (Burger) (defendant) seeking the court’s declaration that MFC had satisfied its debt to Burger. Burger countersued seeking damages in the amount of the debt of $58,518.41. MFC and Burger had a longstanding business relationship that was continually strained by disagreements over allegedly incomplete MFC payments for Burger’s delivery of milk products. Following extensive negotiations, MFC attempted to settle its debt with Burger by tendering two checks marked to indicate payment in full of its account. Burger cashed the checks, but denied that they were sufficient to settle the debt. MFC argued that by cashing the checks Burger accepted them as payment for the debt, thus effecting an “accord and satisfaction” of the debt. The trial court found for Burger, awarding the full amount claimed.

Rule of Law

Issue

Holding and Reasoning (Coffey, J.)

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