Accord and Satisfaction

In one sentence

An agreement to settle a dispute by accepting something different from the original contract.

Plain English

When there's a disagreement about a contract, the parties can make a new deal to resolve it. An accord is the new agreement, and satisfaction is when both sides perform it. For example, if you're owed $1,000 but agree to accept $800 instead, that's an accord. Once you accept the $800, you're satisfied—you've given up your right to demand the full $1,000. This is a way to end a dispute without going to court.

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Example

A contractor owes you $5,000 for work, but you dispute the quality. You agree to accept $3,500 as full payment and sign a release. Once you cash the check, you've accepted the accord and satisfied the original debt.

Used in a sentence

“The parties reached an accord and satisfaction by agreeing the seller would replace the defective goods instead of issuing a refund.”

Related terms

Mutual Consent

Both parties freely agree to the same terms of a contract without pressure or misunderstanding.

Contract Modification

A mutual agreement between parties to change the terms of an existing contract.

Release

A written agreement giving up a legal right or claim.

Offer

A proposal to enter into a binding agreement on specific terms.

Acceptance

Agreeing to the exact terms of an offer, creating a binding contract.

Consideration

Something of value exchanged by each party to make a contract binding.

Offeror

The person who makes an offer to enter into a contract.

Offeree

The person who receives an offer and has the power to accept or reject it.

This page is a plain-English reference and is not legal advice. Laws vary by jurisdiction and change over time. For specific situations consult a licensed attorney.