Illinois Courts have generally defined accord and satisfaction as an agreement to discharge a debt or claim by some performance other than that which was originally due.[i] An accord and satisfaction is contractual in nature, and the intent of the parties is of central importance. A transaction will constitute an accord and satisfaction of a claim only where both parties intend it to have that effect. When a payment of less than what is claimed is tendered and accepted, it will not constitute an accord and satisfaction of the entire claim unless it can be demonstrated that the creditor intended to accept it as full satisfaction. Accord is the actual agreement between the parties, while the satisfaction is its execution or performance.[ii] The essential elements are:
- a bona fide dispute as to the claims pending between the parties;
- an unliquidated sum owed;
- a shared mutual intent to compromise the claims; and
- execution of the agreement.
[i] Holman v. Simborg, 152 Ill. App. 3d 453 (Ill. App. Ct. 1st Dist. 1987)
[ii] MKL Pre-Press Elecs. v. La Crosse Litho Supply, LLC., 361 Ill. App. 3d 872 (Ill. App. Ct. 1st Dist. 2005)