In order to constitute an accord and satisfaction in Colorado, it is necessary that the money should be offered in full satisfaction of the demand, and be accompanied by such acts and declarations as amount to a condition that the money, if accepted, is accepted in satisfaction.[i] It must be such that the party to whom it is offered is bound to understand therefrom that if s/he takes it, s/he takes it subject to such conditions.
Payment and acceptance of a less sum than claimed in satisfaction operates as an accord and satisfaction, where a claim is unliquidated or in dispute.[ii] However, once it is established that there is a valid accord and satisfaction, it is governed by the same rules as applied to other contracts.[iii]
[i] R.A. Reither Constr., Inc. v. Wheatland Rural Electric Asso., 680 P.2d 1342 (Colo. Ct. App. 1984)
[ii] Stanley-Thompson Liquor Co. v. Southern Colorado Mercantile Co., 65 Colo. 587 (Colo. 1919)
[iii] Caldwell v. Armstrong, 642 P.2d 47 (Colo. Ct. App. 1981)