A party that receives an invoice and holds it without dispute does so at its peril: Absent an objection within a reasonable time, the recipient can become liable for the entire amount of the invoice based on an account stated. There are, however, limits to this principle that are often overlooked, to the confusion of both litigators and their clients. This article explores those limits.
The basic premise of a claim for account stated is straightforward on its face: “[W]here an account is rendered showing a balance, the party receiving it must, within a reasonable time, examine it and object, if he disputes its correctness. If he omits to do so, he will be deemed by his silence to have acquiesced, and will be bound by it as an account stated unless fraud, mistake or other equitable considerations are shown.” Cushman & Wakefiled, v. Kadmon, 175 A.D.3d 1141 (1st Dept. 2019) (citation and internal quotations omitted).
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