In Indiana, the term “accord” denotes an express contract between two parties by means of which the parties agree to settle some dispute on terms other than those originally contemplated. The term “satisfaction” denotes performance of the contract.[i]
An accord and satisfaction is a method of discharging a contract, or settling a cause of action arising either from a contract or from tort, by substituting for such contract or such cause of action an agreement for the satisfaction thereof and executing such substituted agreement.[ii] An accord and satisfaction must be supported by a good or valuable consideration. Moreover, the payment of part of one’s liability is not sufficient consideration to cancel the whole liability, where the debt is liquidated.
[i] Wolfe v. Eagle Ridge Holding Co., LLC, 869 N.E.2d 521 (Ind. Ct. App. 2007)
[ii] Sunderman v. Sunderman, 116 Ind. App. 157 (Ind. Ct. App. 1945)