Question

Under the UCC, writing "paid in full" on a check for less than the full amount of the debt owed will not be an accord and satisfaction unless the creditor inadvertently cashes the check and waits longer than 90 days to offer the debtor repayment in the same amount, or unless the words "paid in full" are written conspicuously with red ink and 14-point font. Which of the following conditions would also make it an accord and satisfaction?

1) The check is sent to a special address for disputed amounts per the creditor's request.
2) The check was sent to a credit card company.
3) The debt was for medical services.
4) None of the above.

Answer 1

An accord and satisfaction under the UCC requires specific conditions, including a designated address by the creditor for disputed amounts. This is valid regardless of the type of debt, including disputes with credit card companies or medical service debts.

Step-by-step explanation:

Under the Uniform Commercial Code (UCC), an accord and satisfaction is a legal agreement between a debtor and a creditor, where the debtor offers payment less than the full amount owed and the creditor accepts it as full satisfaction of the debt. To be valid, certain conditions must be met. One such condition includes sending the check to a special address designated by the creditor for disputed amounts. This implies that the creditor acknowledges the dispute and that the payment is made under a new agreement resolving the dispute. This does not necessarily apply to specific types of debts, such as those owed to a credit card company for short-term loans or accounts related to medical services.