Legal Question in Credit and Debt Law in Tennessee

You are thinking of the doctrine of what is known as "accord and satisfaction" of the account meaning you would have no further liability; however, the language on the memo line of your check is somewhat ambiguous as to its meaning. Does the language mean your bank account is closed upon the check being cashed or does it mean the collection account is reduced to a "zero" balance?

To constitute an accord and satisfaction of an account, the paying instrument must either specfiy or be accompanied by a writing that clearly states that the check is "tendered as full satisfaction of the claim". Section 47-3-311, Tennessee Code Annotated.

Not only must the language on the check or an accompanying document be clear and unambiguous, but there are two qualifying conditions with respect to the application of accord and satisfaciton. First, if sometime before you made the "final payment" the agency or the creditor sent you a notice advising you of the full amount needed to pay the account and provided to you an address to which the full amount was to be sent and you did not pay the full amount or did not send the "final payment" to the provided address, then your check with the notation does not constitute an accord and satisfaction. The second alternative condition is that if you sent the check with a notation that is clear and not subject to different meanings, the agency and/or the creditor has 90 days from the date the payment was received to return the payment to you.

My impression however, is that the cited language that you put on the check is not clear as to its meaning and therefore, the agency is within its rights to cash the check and continue to press for additional payments.