Apple Valley Mall v. Floyd Realty Co., Inc., 97-4157 (1998) (1998)

Citation: Apple Valley Mall v. Floyd Realty Co., Inc., 97-4157 (1998) (1998)
Parent Document: Apple Valley Mall v. Floyd Realty Co., Inc., 97-4157 (1998) (1998)
Jurisdiction: Rhode Island (state)
Effective Date: 1998-03-30
Original Source: https://www.courtlistener.com/opinion/4113657/apple-valley-mall-v-floyd-realt... ↗

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By following the payment application rules discussed inHarris, supra, and Albert S. Eastwood Lumber Co., supra, the plaintiff was under an absolute duty to apply the payment as the defendant directed. 60 Am.Jur.2d Payment § 94 (1987) (Once the application of payment is made to a particular obligation by the debtor or creditor it is final and conclusive.). However, each party was also under a duty to perform and enforce the lease in a manner of good faith and fair dealing to achieve the common purpose of the lease and to maintain consistency with the justified expectation of the other party. Centerville Builders,Inc. v. Wynne; Careau Co., supra; Careau Co. v. SecurityPacific Business Credit, Inc., supra. To resolve this obvious conflict, other jurisdictions have recognized that the general payment application rules, as stated in Harris, supra, and AlbertS. Eastwood Lumber Co., supra, should not be followed when, from the circumstances surrounding the case, it appears that their application would be inequitable or unjust. 60 Am.Jur.2d § 94, supra; see also Village of Winfield v. Reliance InsuranceCompany, 64 Ill. App.2d 253, 212 N.E.2d 10 (1965); Dallas Title Guaranty Co. v. Valdes 445 S.W.2d 26 (Tex. Civ. App. 1969 writ ref'd n.r.e). Moreover, the Appellate Court of Illinois has held that "the general rules regarding the appropriation of payment will not be applied when, from the circumstances surrounding the case, it appears that the application . . . would work an injustice. (citation omitted)." Village of Winfield v. RelianceInsurance Company, supra at 12. This holding is in accord with the pronouncement of the Honorable Justice Cardozo in the case ofCarson et al. v. Federal Reserve Bank of New York, 254 N.Y. 218,172 N.E. 475, 480, 70 A.L.R. 435, wherein he stated:

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