Federal Government


Accord and satisfaction is a method of discharging a claim whereby the parties agree to give and accept something in settlement of the claim and perform the agreement.  Accord is the agreement and satisfaction is its execution or performance.

Generally, an executed bilateral modification of a government contract that contains no reservation of rights constitutes an “accord and satisfaction.”[i]

The Secretary of the Treasury can compromise any claim arising under custom laws upon a report by a customs officer, United States attorney, or any special attorney if such action is recommended by the General Counsel for the Department of the Treasury[ii].

Likewise, the Secretary of the Treasury can compromise any civil or criminal case arising under the internal revenue laws.  The Attorney General or his/her delegate can compromise any civil or criminal case after referring to the Department of Justice for prosecution or defense[iii].

In Kanag’Iq Constr. Co. v. United States[iv], a contractor entered into a contract with the United States Department of Health and Human Services to perform architectural and electrical repairs and renovations on a health service building.  The contractor sought additional money for rerouting some wires due to asbestos located in the building.  The court observed that the contractor’s letter to the government constituted a claim regarding the rerouting of certain wires under the Contract Disputes Act.  But the court added that the letter did not constitute a claim for delay costs.

[i] Kanag’Iq Constr. Co. v. United States, 51 Fed. Cl. 38 (Fed. Cl. 2001)

[ii] 19 U.S.C.A. § 1617.

[iii] Id.

[iv]Kanag’Iq Constr. Co. v. United States, 51 Fed. Cl. 38 (Fed. Cl. 2001)