COURT OF APPEALS OF OHIO, EIGHTH DISTRICT COUNTY OF CUYAHOGA NO. 68438 FRANK PERONI, DBA FANO : CONSTRUCTION, INC. : : : JOURNAL ENTRY Plaintiff-Appellee : : AND vs. : : OPINION DiBACCO & FATHER, INC. : : : Defendant-Appellant : : DATE OF ANNOUNCEMENT OF DECISION: OCTOBER 19, 1995 CHARACTER OF PROCEEDING: Civil proceeding from Lyndhurst Municipal Court Case No. 93-CVF-1253 JUDGMENT: AFFIRMED. DATE OF JOURNALIZATION: APPEARANCES: For Plaintiff-Appellee: MICHAEL A. SANSON 1640 Standard Building Cleveland, Ohio 44113 For Defendant-Appellant: ROBERT M. LUSTIG SUSAN M. EVANS Lustig, Icove & Lustig 615 Leader Building Cleveland, Ohio 44114 - 2 - O'DONNELL, J.: DiBacco & Father, Inc., a general contractor, appeals the Lyndhurst Municipal Court judgment for Frank Peroni, a masonry subcontractor, on a contract dispute for work done at the Faith United Church of Christ. Because we conclude the trial court correctly determined the accord and satisfaction issue, we affirm. DiBacco orally contracted with Peroni in 1992 and Peroni has completed the masonry job at the church. Now, each describes the contract differently because of changes and modifications made during the course of the project. In addition, the parties now dispute the value of the work performed by Peroni and, therefore, the balance due. DiBacco made periodic payments to Peroni during the course of the project. He issued $1,000 in October, $2,000 in November, and $2,000 in December. On December 11, 1992 Peroni invoiced DiBacco for an overall price of $11,170, acknowledging receipt of $5,000 and claiming a balance due of $6,170. The job was completed in late December 1992. Thereafter, DiBacco sent $2,000 to Peroni on January 5, 1993. Then on March 1, 1993, DiBacco sent Peroni a statement listing the items charged by Peroni, but containing DiBacco's figures which he claimed to be the actual value of Peroni's work, and reflecting a balance due of only $399. Three days later, DiBacco mailed Peroni a $399 check on - 3 - the face of which was written: "Paid in full for Concrete & Brick work at Faith United Church of Christ No Disclaimers". Peroni's son retrieved all the mail from the post office box and cashed the check, which was presented for payment without personal endorsement. When Peroni learned of the $399 payment, he sent DiBacco another invoice, reflecting the $399 credit. The parties differed as to the balance due and DiBacco refused to pay. Peroni filed suit in the Lyndhurst Municipal Court and DiBacco defended by claiming accord and satisfaction. The trial court, affirming the referee's report, found for Peroni and entered judgment in the sum of $2,968.49. DiBacco now appeals and assigns the following error for our review: THE TRIAL COURT ERRED TO DEFENDANT-APPELLANT'S PREJUDICE BY FAILING TO FIND PLAINTIFF-APPELLEE'S ACTION BARRED BY ACCORD AND SATISFACTION. DiBacco argues that he owes no additional money to Peroni because he disputed the amount owed, sent Peroni a check with a notation of payment-in-full and Peroni's son, an agent in this instance, negotiated the check. He maintains his obligation is extinguished because of accord and satisfaction. In contrast, Peroni asserts he never saw the payment in full notation on the face of the check, he did not agree to accept $399 as full payment, and because neither he nor his son endorsed the check, the bank's stamp on the back of the check cannot constitute his acceptance of a lesser amount. Therefore, he claims no accord and satisfaction exists in this instance. - 4 - In order to resolve this case, then, we must examine the defense of accord and satisfaction. The Ohio Supreme Court announced the proper way to analyze an accord and satisfaction defense: First, the defendant must show that the parties went through a process of offer and acceptance -- an accord. Second, the accord must have been carried out -- a satisfaction. Third, if there was an accord and satisfaction, it must have been supported by consideration. Allen v. R.G. Indus. Supply (1993), 66 Ohio St.3d 229 at paragraph one of the syllabus. In addition, the court emphasized: Two essential safeguards built into the doctrine of accord and satisfaction protect creditors or injured parties from overreaching debtors or tortfeasors: (1) there must be a good-faith dispute about the debt, and (2) the creditor must have reasonable notice that the check is intended to be in full satisfaction of the debt. Id. at paragraph two of the syllabus. Applying Allen to this case, the evidence contained in the record does not suggest the parties agreed upon the $399 amount as a payout balance. Rather, while DiBacco thought his memo notation on the face of the check constituted Peroni's acceptance of the $399 offer to settle upon negotiation, Peroni himself never negotiated the check and did not endorse it. Hence, no accord existed in this case between the parties. Because no accord existed, there can be no satisfaction. The court in Allen further explained, "the first and second inquires [of accord and satisfaction] merge when the creditor - 5 - manifests acceptance of the offer by negotiating a check sent by the debtor with the offer." Id. at 232. (Emphasis added.) How- ever, Peroni did not manifest such acceptance because he neither saw nor negotiated the $399 check. Rather, his son cashed it, and the record reflects his son had no knowledge of this contract dispute and no authority to settle claims on his father's behalf. As stated in Kirk Williams Co. v. Six Industries, Inc. (1983), 11 Ohio App.3d 152 at 155: Mere authority given an agent to indorse a check for deposit does not effect an accord and satisfaction based upon the receipt of a check for an amount less than that due where the agent does not have knowledge of any controversy as to the amount of the indebtedness or authority to adjust any such controversy. 1 American Jurisprudence 2d, supra, Section 8, at 306-307. Therefore, cashing of this check does not amount to a negotiation by Peroni for the purposes of establishing the defense of accord and satisfaction. Finally, here, as in Allen, supra, the language which DiBacco believes constitutes an accord is printed on the face of the check, as a memo, with no notation on the back of the check to advise an endorser of those terms. The court in Allen, supra, stated at 235, "[a]s a matter of law, the printed statement on the face of the check is insufficient to constitute express notice *** that it was offered in exchange for a full release." Accordingly, in conformity with Allen, the memo notation printed on the face of DiBacco's check does not constitute notice to Peroni of DiBacco's intent to fully satisfy the obligation. - 6 - Therefore, cashing of that check did not constitute an accord and satisfaction and did not settle all claims between the parties. This assignment of error is therefore overruled and the judgment of the trial court is affirmed. - 7 - It is ordered that appellee(s) recover of appellant(s) costs herein taxed. The Court finds there were reasonable grounds for this appeal. It is ordered that a special mandate issue out of this Court directing the Lyndhurst Municipal Court to carry this judgment into execution. A certified copy of this entry shall constitute the mandate pursuant to Rule 27 of the Rules of Appellate Procedure. DAVID T. MATIA, P.J., and JAMES M. PORTER, J., CONCUR JUDGE TERRENCE O'DONNELL N.B. This entry is made pursuant to the third sentence of Rule 22(D), Ohio Rules of Appellate Procedure. This is an announce- ment of decision (see Rule 26). Ten (10) days from the date hereof, this document will be stamped to indicate journaliza- .