Lana accepts $100 from Jan as full payment of a past-due note of $150, giving Jan a signed sealed release of?

Question

the entire debt. Is the debt entirely canceled?
Would your answer differ if there were no signed, sealed release?
Please explain, i need help with this one!

Answer 1

It is called accord and satisfaction. The debt is satisfied. It is still accord and satisfaction just a bit harder to prove.
It is a new contract for a debt owed. Jan will pay Lana $100, if Lana agrees it covers all the $150 debt. It is a bargained for consideration.

Answer 2

The signed document, in which Lana has accepted $100 to discharge the entire debt of $150 owed to her by Jan is binding.

The facts do not state the consideration of the new agreement, but it could be because Jan has accelerated the loan payments with a lump sum certain.

However, if there is no discharge agreement, Jan still owes Lana an additional $50.00.

Answer 3

Answer is a resounding YES. It is common in many litigation cases for a plaintiff to settle for less than the amount he is owed.

There are many reasons for this, but chief among them is not having to go through the trial process which increases legal fees. There is also the possibility of losing the trial.

I would see this as a case where the plaintiff has a claim for $150 but was prepared to accept $100 in full and final settlement of the claim and was prepared to give a discharge to the potential defendant.

If there was no discharge, then there would be no settlement and there would be a further sum of $50 due and owing to Lana from Jan.

hope this helps

Answer 4

Yes, it would cover the entire debt. If there was no release, things could be different. If a receipt for this payment showed a balance (of $50), Jan would still be responsible for it. If there was no receipt given for the payment, Jan could legally be responsible to re-pay the entire amount.