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COURT OF APPEALS DECISION DATED AND RELEASED September 7, 1995 |
NOTICE |
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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. 95-1327-FT
STATE
OF WISCONSIN IN COURT OF
APPEALS
DISTRICT IV
LUBCKE LANDSCAPING,
INC.,
Plaintiff-Appellant,
v.
GARY J. DIVALL,
DIVALL DEVELOPMENT
CORPORATION,
TIMOTHY CONNERY and
CONNERY BUILDING
CORPORATION,
Defendants-Respondents.
APPEAL from a judgment
of the circuit court for Dane County:
DANIEL R. MOESER, Judge. Affirmed.
Before Gartzke, P.J.,
Dykman and Vergeront, JJ.
PER CURIAM. Lubcke Landscaping, Inc. appeals from a
judgment dismissing its claim against Gary Divall, Divall Development
Corporation, Timothy Connery, and Connery Building Corporation. Lubcke sued on a note executed by the respondents. Because the undisputed facts show that
Lubcke cannot recover on the note, we affirm.[1]
Divall and Connery were
general partners in Ashbury Meadows Associates, Lubcke's debtor. In order to obtain waivers on liens Lubcke
held on Ashbury's property, the respondents executed a note agreeing to pay an
amount equal to Ashbury's debt to Lubcke.
Several months later, in
exchange for an agreement not to pursue collection on Lubcke's debts, Lubcke
assigned M & I Bank "all of its rights, title and interest in"
the note. In November 1993, with that
assignment still in effect, Lubcke nevertheless commenced this action, alleging
that the respondents had defaulted on the note. Meanwhile, Ashbury had filed a petition in bankruptcy. In March 1994, Lubcke filed a claim against
Ashbury in bankruptcy court. The
bankruptcy plan proposed full payment of the note to M & I to satisfy
Lubcke's claim, without interest after the bankruptcy petition was filed. Lubcke voted in favor of the plan, the
bankruptcy court confirmed it, and Ashbury's escrow account issued a joint
check to Lubcke and M & I. The
check, which Lubcke endorsed, stated that it was "in full settlement and
satisfaction of all claims of Lubcke Landscape under Chapter 11 Plan confirmed
5/24/94." The bank retained the
proceeds and gave Lubcke the note.
Lubcke continued this action, seeking $1,441 in interest on the note
after the bankruptcy petition was filed, and attorney's fees expended by Lubcke
in collecting on the note.
We decide motions for
summary judgment in the same manner as the trial court and without deference to
its decision. Schaller v. Marine
Nat'l Bank, 131 Wis.2d 389, 394, 388 N.W.2d 645, 648 (Ct. App.
1986). Summary judgment is appropriate
if, as here, the material facts are not in dispute and admit of only one
reasonable inference. Wagner v.
Dissing, 141 Wis.2d 931, 939-40, 416 N.W.2d 655, 658 (Ct. App.
1987).
Lubcke describes the
note as a guarantee of Ashbury's debt to Lubcke, and we accept that characterization. Discharge of the guaranteed debt
automatically discharges the obligation of the guarantors. Restatement
of Security § 115(1) (1941).
Respondents' obligation
on the note was therefore discharged when Ashbury's debt was discharged through
accord and satisfaction. To obtain a
discharge through accord and satisfaction, the debtor must convey information
that would cause a reasonable creditor to understand that the tendered
performance is offered as full satisfaction of the claim. Hoffman v. Ralston Purina Co.,
86 Wis.2d 445, 453, 273 N.W.2d 214, 217 (1979). The creditor must then manifest an intent to accept the
performance as full satisfaction. Id.
at 454, 273 N.W.2d at 217. Here, Lubcke
approved the bankruptcy plan for payment of Ashbury's debt. The check for that payment expressly stated
that it fully satisfied Lubcke's claim.
Lubcke then endorsed the check manifesting its intent to accept it as
full satisfaction. At that point,
Ashbury's debt was discharged and the respondents were no longer obligated on
the note.
Lubcke cannot claim
attorney's fees in collecting on the note.
The note provided that the respondents would pay all costs of
collection, including reasonable attorney's fees. However, Lubcke lost its right to pursue recovery under this
provision when it assigned all its rights in the note to M & I. By the time it received the note back, the
debt was fully satisfied.
By the Court.—Judgment
affirmed.
This opinion will not be
published. See Rule 809.23(1)(b)5, Stats.