Accord and Satisfaction
A recent opinion from the 6th Circuit Court of Appeals nicely outlines the law of accord and satisfaction in Tennessee. The case, Scipio v. Sony Music Entertainment, Inc., 2006 WL 527062
(6th Cir.) involved claims of copyright infringement brought by former members of a british funk group against members of the contemporary group, "The Fugees." In analyzing whether a proposed agreement between the parties constituted an accord and satisfaction under Tennessee law, the Court explained this State's version of the doctrine as follows:
According to Tennessee's long-standing definition of an accord and satisfaction:
An accord is an agreement whereby one of the parties undertakes to give or perform, and the other to accept in satisfaction of a claim, liquidated or in dispute, and arising either from contract or from tort, something other than or different from what he is or considers himself entitled to; and a satisfaction is the execution of such agreement.
In other words, [T]he accord of "accord and satisfaction" is a form of contract. The satisfaction of a disputed debt (or of an undisputed yet unliquidated debt) is offered in consideration for the substitute performance.
The party asserting the defense of accord and satisfaction must prove by a preponderance of the evidence both that a contract existed and that "the contracting plaintiff agreed to accept lesser payment rendered in satisfaction of the original performance or payment for which the parties contracted." In the latter inquiry, "[w]hether a later agreement between contracting parties represents an accord and satisfaction so as to extinguish their original relationship or whether it is simply an executory accord is a matter of the intention of the parties."
In the instant case, the court found that the agreement between the parties, on its face, could have met the elements of an accord and satisfaction, but that, as required of any contract, there was never a meeting of the minds that would constitute ratification.