Accord and Satisfaction

A claim is discharged if the person against whom the claim is asserted proves that the instrument or an accompanying written communication contained a conspicuous statement to the effect that the instrument was tendered as full satisfaction of the claim. A claim is not discharged if either of the following applies: The claimant, if an organization, proves that: Within a reasonable time before the tender, the claimant sent a conspicuous statement to the person against whom the claim is asserted that communications concerning disputed debts, including an instrument tendered as full satisfaction of a debt, are to be sent to a designated person, office, or place; and The instrument or accompanying communication was not received by that designated person, office, or place; or The claimant, whether or not an organization, proves that within 90 days after payment of the instrument, the claimant tendered repayment of the amount of the instrument to the person against whom the claim is asserted. A claim is discharged if the person against whom the claim is asserted proves that within a reasonable time before collection of the instrument was initiated, the claimant or an agent of the claimant having direct responsibility with respect to the disputed obligation knew that the instrument was tendered in full satisfaction of the claim. (Ga. Code Ann., § 11-3-311)

An accord and satisfaction occurs where parties to an agreement, by a subsequent agreement satisfy the former agreement through execution of the latter agreement. O.C.G.A. § 13-4-101. See Prater v. American Protection Ins. Co., 145 Ga. App. 853, 244 S.E.2d 925 (1978). The execution of a new agreement may itself amount to a satisfaction if there is consideration for the new agreement. Codner v. Siegel, 246 Ga. 368, 271 S.E.2d 465 (1980) (holding that partial performance absent other consideration is not sufficient to support an accord and satisfaction); See also Mitchell and Pickering v. Louis Isaacson, Inc., 139 Ga. App. 733, 229 S.E.2d 535 (1976); Thurmond v. Peoples Auto. Loan & Finance Corp., 118 Ga. App. 844, 165 S.E.2d 885 (1968). Parol evidence is admissible to show the scope of an agreement based on accord and satisfaction. Wallace v. Harrison, 166 Ga. App. 461, 304 S.E.2d 487 (Ga. Ct. App. 1983).

Georgia Code Annotated § 11-3-311. Accord and satisfaction by instrument

(a) If a person against whom a claim is asserted proves that (i) such person in good faith tendered an instrument to the claimant as full satisfaction of the claim; (ii) the amount of the claim was unliquidated or subject to a bona fide dispute; and (iii) the claimant obtained payment of the instrument, then subsections (b), (c), and (d) of this Code section shall apply.

(b) Unless subsection (c) of this Code section applies, the claim is discharged if the person against whom the claim is asserted proves that the instrument or an accompanying written communication contained a conspicuous statement to the effect that the instrument was tendered as full satisfaction of the claim.

(c) Subject to subsection (d) of this Code section, a claim is not discharged under subsection (b) of this Code section if either of the following applies:

(1) The claimant, if an organization, proves that:

(i) Within a reasonable time before the tender, the claimant sent a conspicuous statement to the person against whom the claim is asserted that communications concerning disputed debts, including an instrument tendered as full satisfaction of a debt, are to be sent to a designated person, office, or place; and

(ii) The instrument or accompanying communication was not received by that designated person, office, or place; or

(2) The claimant, whether or not an organization, proves that within 90 days after payment of the instrument, the claimant tendered repayment of the amount of the instrument to the person against whom the claim is asserted. This paragraph does not apply if the claimant is an organization that sent a statement complying with subparagraph (i) of paragraph (1) of this subsection.

(d) A claim is discharged if the person against whom the claim is asserted proves that within a reasonable time before collection of the instrument was initiated, the claimant or an agent of the claimant having direct responsibility with respect to the disputed obligation knew that the instrument was tendered in full satisfaction of the claim.

Accord and satisfaction is an affirmative defense and must be specifically pled. O.C.G.A. § 9-11-8.