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Creditor’s Cashing of Check Offered in Full Satisfaction as Acceptance

When a debtor tenders a check or draft with a written notation indicating it is in full settlement of all claims, and the claimant accepts the tender, an “accord and satisfaction” is present.[i]  By negotiating a check, which the debtor offers as a full payment for an unliquidated or disputed debt or obligation, acceptance of the check constitutes accord and satisfaction discharging the claim.[ii] Thus, in order for acceptance of a check to create an accord and satisfaction, the notation on the check or an accompanying writing must express in plain, definite, and certain terms that the debtor is giving such check in full satisfaction of the debt and that acceptance thereof discharges the debt.[iii]

[i] Oregon Mut. Ins. Co. v. Barton, 109 Wash. App. 405, 36 P.3d 1065 (Div. 3 2001)

[ii] Valley Asphalt, Inc. v. Stimpel Wiebelhaus Associates, 3 Fed. Appx. 838 (10th Cir. 2001)

[iii] Strother v. Strother, 136 Idaho 864, 41 P.3d 750 (Ct. App. 2002).


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