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Multiple Claims Between Parties

An accord and satisfaction occurs when parties to contract agree that the debt is discharged in a manner other than in accordance with the terms of their original contract.  The acceptance of a check which states that it is in satisfaction of full demand is an accord and satisfaction of whole demand.  An essential element of accord and satisfaction is an agreement, or a meeting of the minds of the parties.  Accord and satisfaction agreement should have all the essentials of a contract and may be express, or implied from the circumstances.  Essential to accord is the identity of the claim, or claims, account, or accounts, to be satisfied by acceptance of the accord.  In Roberts v. Finger,[i] court held that an accord and satisfaction is not completed by the tender and acceptance of a check with the words “account in full”.  If payee reasonably understands that a particular account is intended to be satisfied, there is no accord and satisfaction of another account or claim.  An accord is reached when the creditor accepts the debtor’s payment in satisfaction of all claims of the creditor.[ii] If a check is accompanied by a letter stating that check represents “the amount due in full to complete recent buy-back on your account,” the acceptance of the check did not constitute an accord and satisfaction.  When there is more than one claim or account against a debtor, the creditor may reasonably assume that payment for the exact amount of one claim or billing was intended to settle that claim alone.  Such payment will not satisfy all claims unless the debtor specifically expresses such intention.[iii]

[i] Roberts v. Finger, 227 Miss. 671 (Miss. 1956)

[ii] United States use of Glickfeld v. Krendel, 136 F. Supp. 276 (D.N.J. 1955)

[iii] Daube & Cord v. La Porte County Farm Bureau Co-Operative Ass’n, 454 N.E.2d 891 (Ind. Ct. App. 1983)

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