Texas Causes of Action & Affirmative Defenses

Texas Causes of Action & Affirmative Defenses

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Monday, November 2, 2009

Accord and Satisfaction as Affirmative Defense to Debt Claim

WHAT IS "ACCORD AND SATISFACTION" AS A LEGAL CONCEPT? The affirmative defense of accord and satisfaction is a type of contractual modification that rests upon a new contract, express or implied, in which the parties agree to the discharge of the existing obligation by means of a lesser payment tendered and accepted. Jenkins v. Henry C. Beck Co., 449 S.W.2d 454, 455 (Tex. 1969). A modification of a contract must satisfy the elements of a contract: a meeting of the minds supported by consideration. Hathaway v. Gen. Mills, Inc., 711 S.W.2d 227, 228 (Tex. 1986). Whether a contract is modified depends on the parties' intentions and is a question of fact. Id. at 228-29. ACCORD AND SATISFACTION REQUIRES AGREEMENT ON MODIFICATION OF ORIGINAL CONTRACT AND CONSIDERATION The burden of proving modification rests on the party asserting the modification. Id. at 229. Because a valid accord and satisfaction depends upon an agreement, it "only occurs when the parties mutually assent to it," and their intention is a controlling element. McCarty v. Humphrey, 261 S.W. 1015, 1016 (Tex. Comm'n App. 1924, judgm't adopted). The trial court found that there was no mutual assent or “meeting of the minds” necessary for an accord and satisfaction. We defer to the trial court’s findings of fact that there was not sufficient intent that a new agreement was formed. We find that the trial court did not err in its finding of no accord and satisfaction as a matter of law and that this finding is not against the great weight of the evidence. SOURCE: 10-07-00362-CV (Tenth Court of Appeals-Waco) (10/28/2009)