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accord and satisfaction

Accord and satisfaction is an enforceable agreement in which the parties agree to discharge a contract, claim, or obligation on terms that differ from the original terms of the contract, claim, or obligation.

In New Mexico, accord and satisfaction is recognized as a method to discharge a contract or settle a dispute by agreeing to provide something different from what was originally owed. This is typically used when there is a bona fide dispute over the debt or obligation. The party who owes the debt or obligation (the debtor) offers to pay a different amount or provide a different performance, and if the party to whom the debt is owed (the creditor) accepts this, the original obligation is considered settled. The new agreement, the 'accord,' and the performance of it, the 'satisfaction,' must both occur for the original obligation to be discharged. This concept is governed by common law principles and is also codified under the Uniform Commercial Code (UCC), which New Mexico has adopted, specifically in relation to the resolution of disputed debts involving negotiable instruments. It is important for parties considering an accord and satisfaction to ensure that the agreement is clear and that the satisfaction is duly executed to avoid further disputes. An attorney can provide guidance on how to properly structure such an agreement to ensure its enforceability under New Mexico law.

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Contracts

accord and satisfaction

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Contracts

accord and satisfaction

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