Contracts & ExecutionQuestion 870 of 1605
'Accord and satisfaction' discharges a disputed obligation when:
a.The parties agree to arbitrate
b.One party simply ignores the debt
c.The parties agree to accept a different performance (the accord) in settlement, and that new performance is completed (the satisfaction)
d.A court orders specific performance
Explanation
Accord and satisfaction discharges a disputed or unliquidated obligation when the parties reach a new agreement (the accord) to accept a different, often lesser, performance in full settlement, and that substitute performance is actually rendered (the satisfaction). For example, cashing a check marked 'payment in full' on a genuinely disputed amount can complete an accord and satisfaction. It is not merely ignoring a debt, a court order, or an agreement to arbitrate.
Practice all 1605 questions free — no signup required.
Related questions on this topic
- Nominal damages are awarded when:
- A 'waiver' in the context of a contract generally refers to:
- A 'no oral modification' clause states that the contract may be changed only by a signed writing. Its practical purpose is to:
- The doctrine of 'impossibility' (or impracticability) may excuse performance when:
- 'Frustration of purpose' as an excuse for nonperformance applies when:
- A third-party beneficiary who is an 'intended beneficiary' of a contract:
Last reviewed: · editorial process
Sen Lin, PrepPass Founder · Verified against California CSLB Contractor License Law & Business Exam · How we review
Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)