Accord and Satisfaction - Issue 1

"An executory accord can not be denied effect as a defense or as the basis of an action or counterclaim because the satisfaction or discharge of the claim, cause of action, contract, obligation, lease, mortgage or other security interest which is the subject of the accord was to occur at a time after the making of the accord, provided the promise is in writing.

If an executory accord is not performed according to its terms by one party, the other party is entitled either to assert his rights under the claim, cause of action, contract, obligation, lease, mortgage or other security interest which is the subject of the accord, or to assert his right under the accord. NY General Obligations §15-501

A signed offer in writing to accept a performance in satisfaction or discharge of any claim, cause of action, contract, obligation, or lease, or any mortgage or other security interest in personal or real property, followed by tender before revocation of the offer, can not be denied as a defense or as the basis of an action or counterclaim by reason of offer rejection. NY General Obligations §15-503"

"An accord is a contract, not merely a revocable offer, between creditor and debtor for the settlement of a claim by some performance other than that which is due, and satisfaction takes place when the accord is performed."" 19A N.Y. Jur. 2d, Compromise, Accord, and Release, §1

An accord and satisfaction requires a ""dispute as to the amount due and knowing acceptance by the creditor of a lesser amount."" Rose Inn of Ithaca, Inc. v. Great Am. Ins. Co., 75 A.D.3d 737, 739, 905 N.Y.S.2d 318, 320 (3d Dep't 2010)(citing Consolidated Edison Co. v. Jet Asphalt Corp., 132 A.D.2d 296, 522 N.Y.S.2d 124, 129 (lst Dep't 1987)). ""The payment of an admitted liability is not a payment of or a consideration for an alleged accord and satisfaction of another and independent alleged liability."" Manley v. Pandick Press, Inc., 72 A.D.2d 452, 455, 424 N.Y.S.2d 902, 905 (lst Dep't 1980). Accordingly, an accord and satisfaction cannot arise where there is no dispute as to the amount due. Consolidated Edison Co., 522 N.Y.S.2d at 129. See Fleischman v. New York Life Insurance and Annuity Corp., 93 A.D.3d 496, 939 N.Y.S.2d 853 (1st Dep't 2012)(holding that a motion to dismiss, which was based on a theory of accord and satisfaction, was properly denied since defendant failed to show that there was a clear manifestation of intent by the parties that the payment was made, and accepted, in full satisfaction of the claim, where nothing on the check or in the letter enclosing the check indicated that check was tendered only on the condition that it was in full payment of the disputed claim)."

Accord and satisfaction is an affirmative defense. Young v. Zwack, Inc., 98 A.D.2d 913, 471 N.Y.S.2d 175 (3d Dep't 1983).