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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 Texas, accord and satisfaction is a legal concept that allows parties to settle a dispute by agreeing to terms that are different from the original contract or obligation. This is typically used when there is a disagreement about the performance of a contract or the amount of a debt. Under Texas law, for an accord and satisfaction to be enforceable, there must be a new agreement (the accord) that is executed by the performance of a new act or promise (the satisfaction). The new agreement must be clear and unequivocal, and the performance must be completed. This is codified in the Texas Business and Commerce Code, Section 3.311, which specifically addresses accord and satisfaction by use of a negotiable instrument. The statute requires that a creditor must in good faith tender a check or other negotiable instrument to the debtor that clearly indicates that acceptance of the instrument is payment in full for the disputed amount. If the debtor cashes or otherwise accepts the instrument, it may constitute an accord and satisfaction, discharging the original obligation.


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