On April 1, a buyer agreed to purchase an antique car for $20,000. On April 10, the buyer paid $15,000 by check with the notation: “This check is in full and final satisfaction of my obligation under our April 1 agreement.” The seller deposited the check. If the seller sues for the remaining $5,000, will the buyer’s accord and satisfaction defense likely succeed?

• A. No, because the buyer could modify the agreement without consideration under the UCC.
• B. No, because the price was undisputed.
• C. Yes, because the notation on the check creates a substituted contract.
• D. Yes, because the price was disputed.

Answer: (B)

Accord and satisfaction only works when there is a bona fide dispute about what is owed. A party can offer to accept a lesser amount to settle the claim, and the creditor’s acceptance (often shown by cashing the check with a “full satisfaction” note) discharges the original obligation. But there must actually be a dispute over the amount.

Here, the contract price was not in dispute—the parties had agreed on 20,000. The buyer’s check for 15,000 marked “in full and final satisfaction” tries to settle the entire debt, but there is no genuine dispute to support that settlement. Depositing the check does not automatically discharge the remaining 5,000 unless the creditor agreed to the settlement or a dispute existed; since the price wasn’t disputed, the accord and satisfaction defense is unlikely to succeed and the seller can likely recover the balance.