How To Prove A Texas Accord and Satisfaction Defense
In Texas, a defense of Accord and Satisfaction is defined as:
An agreement to substitute for an existing debt some alternative form of discharging that debt, coupled with the actual discharge of the debt by the substituted performance. The new agreement is called the accord, and the discharge is called the satisfaction
It simply means:
When one person owes another money, but they decide to settle the debt with a different form or amount of payment.
There are 3 elements of the defense:
- Element 1. There was a disputed claim. A disputed claim occurs when two parties disagree about the existence or amount of a debt, which can lead to a legal defense called Accord and Satisfaction, where they settle the disagreement by agreeing to different terms than originally stated.
Facts that might support this element look like:
* The parties engaged in negotiations regarding the amount owed, indicating a disagreement over the total sum.
* One party sent a written demand for payment that was met with a counteroffer, demonstrating a lack of consensus.
* During discussions, both parties acknowledged differing interpretations of the contract terms, highlighting the existence of a dispute.
* A third-party mediator was involved in the discussions, suggesting that the claim was contested and unresolved.
* The defendant provided evidence of prior communications that explicitly challenged the validity of the plaintiff’s claim. - Element 2. The debtor tendered a sum less than that claimed by the creditor. In an Accord and Satisfaction Defense, this means that the person who owes money offered to pay a smaller amount than what the creditor says is owed, hoping to settle the debt for less than the full amount.
Facts that might support this element look like:
* The debtor sent a payment of $1,000 to the creditor, despite the creditor claiming a total debt of $1,500.
* The debtor explicitly stated in a letter that the payment was intended to settle the disputed amount owed.
* The creditor accepted the debtor’s payment without objection, acknowledging it as a partial payment towards the total debt.
* The debtor provided evidence of the payment being made via check, which was cashed by the creditor.
* The creditor did not return the payment or communicate any disagreement with the amount tendered by the debtor. - Element 3. The creditor accepted the payment. In an Accord and Satisfaction Defense, “the creditor accepted the payment” means that the person or business owed money agreed to accept a different amount or form of payment, which settles the debt and prevents them from claiming the full original amount later.
Facts that might support this element look like:
* The creditor received a check marked “payment in full” for the outstanding debt, indicating acceptance of the payment terms.
* The creditor cashed the check without objection, demonstrating their agreement to the settlement of the debt.
* The creditor acknowledged receipt of the payment in writing, confirming their acceptance of the terms proposed.
* The creditor continued to accept payments under the new terms for several months, indicating their acceptance of the modified agreement.
* The creditor did not dispute the payment or the terms until after the check was cashed, suggesting acceptance of the accord.
(See Stone v. Lawyers Title Ins. Corp., 554 S. W. 2d 183 (TX Supreme Court 1977).)
If you’re in court without a lawyer and plan to assert a Defense of Accord and Satisfaction, having a Personal Practice of Law at Courtroom5 is essential. You’ll need to make informed decisions about what to file at each phase of your case and prepare legal documents that are supported by thorough legal research and a strong analysis of the facts. Equip yourself with the tools and knowledge necessary to effectively navigate your legal journey.
Prove Your TX Accord and Satisfaction Defense
U.S. Civil Cases Only