Appeal from the Circuit Court of Cook County, Municipal
Division, Second District; the Hon. J. WARREN McCAFFREY, Judge,
presiding. Judgment affirmed.
MR. JUSTICE MORAN DELIVERED THE OPINION OF THE COURT.
The defendant is a corporation engaged in the business of issuing general life and casualty insurance policies. In the Fall of 1962, its predecessor company undertook to issue additional shares of corporate stock which were to be distributed, not to the public generally, but only to those persons whose interests were, in the judgment of the company, conducive to the growth and development of the company. The prospectus issued, at that time, stated the purpose for which the stock was to be issued and provided that the offering was limited to shares subscribed to by April 1, 1963. Pursuant to the prospectus the company solicited subscriptions for 100,000 shares at $4 per share.
In November, 1962, plaintiff was introduced to Richard T. Christoph, a director of the defendant company, by one, Telpner, a mutual friend. Telpner told Christoph that he believed the plaintiff "would be good in the life insurance business" and that plaintiff was interested in subscribing to some of the stock then being offered by the defendant. Christoph told Telpner that it looked like the stock was going to be oversubscribed; that there was no assurance that he could let plaintiff have any of the stock but that he would consider it. Sometime in December, 1962, Telpner went to Christoph's office. Plaintiff testified that he was also present at this meeting; however, Christoph denied that plaintiff was present and testified that only Telpner was present. In either case, during the course of the meeting, Telpner deposited with Christoph plaintiff's check for $4,000, together with a subscription agreement, signed by plaintiff, wherein plaintiff offered to purchase 1,000 shares at $4 per share.
Paragraph one of the agreement provided, in part, that:
"Upon receipt of this Agreement . . ., the Company will acknowledge said receipt within fifteen (15) days from the date hereof, and issue its Interim Receipt to the subscriber, subject to provisions of paragraph five (5) hereof."
Paragraph four, in part, added:
"Deposit of the funds paid in by the subscriber into the Company's Escrow Account . . . shall constitute acceptance of this agreement by the Company."
and paragraph five partially provided:
". . . Company shall have the right, at its discretion, at the home office, until delivery of the interim receipt, to reject any subscriptions by returning to the subscriber the payment tendered with this subscription."
On January 3, 1963, the defendant forwarded an interim receipt which acknowledged receipt of the plaintiff's subscription agreement and check; advised plaintiff that the offering may be kept open to November, 1963, awaiting approval of the Director of Insurance as provided in the agreement and also in the prospectus; and, that "proper certificates of shares will be issued in accordance with your Subscription Agreement at that time."
The company retained plaintiff's check but did not cash it and did not deposit it in the escrow account. In April of 1963, when the stock was in fact oversubscribed, the plaintiff's check was returned to Telpner. The plaintiff was not informed that his check had been returned until October, 1963, when he had a conversation again with Christoph. During his conversation, Christoph testified that he also told the plaintiff that the company would let him subscribe for 100 shares of the stock at the same price of $4, even though the stock was then selling at $13.00 per share "to settle any differences." Plaintiff did subscribe for the 100 shares of stock, paid $400 and wrote a letter to Christoph saying in part, "I am indeed glad that we have been able to get together in view of the preceding circumstances."
The plaintiff brings this action to recover the sum of $10,000, which he claims to be the fair value of the stock which he never obtained under the subscription agreement. The trial court found that there was no agreement which bound the parties, and that, even if there had been an agreement, the later understanding between plaintiff and Christoph operated as an accord and satisfaction of all claims. Plaintiff appeals to this Court urging that there was a firm agreement accepted by the defendant and that defendant had not proved the affirmative defense of accord and satisfaction.
If the trial court was correct in its conclusion that an accord and satisfaction was proved in this case, then it is unnecessary to consider whether or not the plaintiff and defendant entered into a binding agreement for the purchase of stock. Proving a subsequent accord and satisfaction would be a bar to his recovery. Leafgreen v. Telford, 169 Ill. App. 582, 587-589 (1912).
In order to constitute an accord and satisfaction there must exist a bona fide dispute, Fichter v. Milk Wagon Drivers' Union, Local 753, 382 Ill. 91, 99, 46 N.E.2d 921 (1943), cert den 319 U.S. 758, 87 L Ed 1710, 63 S Ct 1177; the sum in dispute must be unliquidated, A. & H. Lithoprint v. Bernard Dunn Advertising, 82 Ill. App.2d 409, 412, 226 N.E.2d 483 (1967); consideration must be present; however, payment by the debtor of a lesser sum as a compromise of a disputed claim may be deemed proper consideration, Smyth v. Kaspar American State Bank, 9 Ill.2d 27, 42, 136 N.E.2d 796 (1956); A. & H. Lithoprint v. Bernard Dunn Advertising, supra, page 412; a meeting of the minds with intent to compromise is essential but may be gleaned from the words and acts of the parties, Brubaker v. United States, 342 F.2d 655, 661 ...