COURT OF APPEALS DECISION DATED AND RELEASED February 4, 1997 |
NOTICE |
A party may file with the
Supreme Court a petition to review an adverse decision by the Court of
Appeals. See § 808.10 and
Rule 809.62, Stats. |
This opinion is subject to
further editing. If published, the
official version will appear in the bound volume of the Official Reports. |
No. 96-1569
STATE
OF WISCONSIN IN COURT OF
APPEALS
DISTRICT III
ASSET RECOVERY &
MANAGEMENT
CORPORATION,
Plaintiff-Respondent,
v.
MICHAEL G. PLOURDE,
JANET L. PLOURDE,
Defendants-Third Party Plaintiffs,
LAWRENCE J. PLOURDE
and
ARLENE A. PLOURDE,
Defendants-Third Party Plaintiffs-Appellants.
APPEAL from a judgment
of the circuit court for Pierce County:
ROBERT W. WING, Judge. Affirmed.
Before LaRocque, Myse
and Carlson, JJ.
PER
CURIAM. Lawrence and Arlene Plourde appeal a summary judgment
foreclosing on a mortgage and declaring them personally liable for a debt to
Asset Recovery & Management (ARM).
The Plourdes argue that outstanding issues of material fact exist as to
each of their three affirmative defenses: statute of limitations; accord and
satisfaction; and superseding cause, and that ARM violated the implied
provision in every contract to act in good faith. We reject these arguments and affirm the summary judgment.
Lawrence and Arlene
Plourde, along with Michael and Janet Plourde, borrowed $198,000 and secured
that debt by a mortgage. Full payment
was to be made by June 1, 1988. In 1986,
Lawrence and Arlene entered into a land contract with Michael and Janet. Under the terms of the land contract,
Michael and Janet agreed to make the payments on the note. In 1990, Lawrence and Arlene commenced a
foreclosure action against Michael and Janet alleging their failure to make
payments pursuant to the land contract.
After Lawrence was appointed receiver in March 1990, he made a payment
on the note. The parties later agreed
to a settlement where Lawrence and Arlene signed a warranty deed in full
satisfaction of the land contract and, in return, Michael and Janet assumed
responsibility for payment of any sums due on the note. In July 1995, ARM commenced this foreclosure
action and secured a default judgment against Michael and Janet and a summary
judgment against Lawrence and Arlene.
ARM's action against
Lawrence and Arlene was not barred by the statute of limitations. The statute of limitations runs from the
date of a partial payment on an obligation.
See Cornell Univ. v. Roth, 149 Wis.2d 745, 748-49,
439 N.W.2d 154, 156 (Ct. App. 1989).
The question of fact identified by the Plourdes, whether Lawrence acted
in his capacity as a receiver when he made the payment, is not a question of
material fact. A creditor may
reasonably expect that additional payments are forthcoming after receiving a
partial payment from any of the debtors or from a receiver.
The Plourdes cite City
of Milwaukee v. Firemen Relief Ass'n, 34 Wis.2d 350, 358, 149 N.W.2d
589, 593 (1967), for the proposition that there must be an express
acknowledgement of an intent to renew a debt.
That case dealt with renewal of a "debt once barred." Here, the statute of limitations would not
have expired until June 1, 1994, six years from the date the note was due. The payment made by Lawrence in 1990 was not
a renewal of a debt previously barred by the statute of limitations, but merely
a payment on a debt that was not barred by the statute of limitations at the
time payment was made. Since there was
no other reason for the Plourdes or the receiver to pay money to ARM, the
payment constitutes recognition of the debt before the statute of limitations
expired and has the effect of tolling or interrupting the statute of
limitations. See Estate of
Hocking, 3 Wis.2d 79, 86, 87 N.W.2d 811, 815 (1958).
The trial court properly
rejected the Plourdes' affirmative defense of accord and satisfaction. Accord and satisfaction reflects an
agreement to discharge an existing disputed claim. Flambeau Prods. Corp. v. Honeywell Info. Sys., Inc.,
116 Wis.2d 95, 112, 341 N.W.2d 655, 664 (1984). The elements of a contract, offer, acceptance and consideration
must be present. Id. The Plourdes' settlement of their land
contract dispute did not include an agreement by ARM or its predecessors to
release any of the borrowers from their obligation to pay the note. For the obligor to be released from
liability, the obligee must agree to the release. Brooks v. Hayes, 133 Wis.2d 228, 243, 395 N.W.2d
167, 174 (1986). Because the record
contains no evidence that ARM or its predecessors were parties to the agreement
between the Plourdes, the trial court properly concluded that accord and
satisfaction did not apply.
The trial court also
properly rejected the defense of superseding cause. Superseding cause is a tort doctrine. It is inapplicable in a contract action. In addition, there are no facts in this case
that would give rise to the doctrine.
Finally, the record
contains no evidence to support the Plourdes' assertion that ARM or its
predecessors breached their implied duty to act in good faith. The Plourdes again allude to the
participation of ARM's predecessor in the land contract action. The record contains no evidence of any
lending institution's agreement to the settlement. An agreement between two debtors cannot extinguish the rights of
a creditor. Therefore, the record
contains no evidence of bad faith by ARM or its predecessors.
By the Court.—Judgment
affirmed.
This opinion will not be
published. See Rule 809.23(1)(b)5, Stats.