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Devil Is in the Details in NY Settlement Checks.

March 16, 2012

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In the case of <em>Fleischman v. New York Life</em>, New York’s First Department was confronted with the question of what constitutes accord and satisfaction.  The specific issue before the court was whether the defendant’s tender of a refund check, and the subsequent cashing of that check by the plaintiff, indicated that the plaintiff had accepted a full resolution of the disputed claim.  In affirming the trial court, the First Department <a href="http://www.courts.state.ny.us/reporter/3dseries/2012/2012_01785.htm ">ruled</a> that it did not as there was nothing on the check or in the transmittal letter enclosing the check that indicated that the check was tendered “only on the condition that it was in full payment of the disputed claim.”
The moral of the story is that the devil is in the details.  If you think the issuance of a check fully resolves a claim, then you need to make that clear.  Otherwise, you can be left with dangling participles that will have to be cleaned up later.
For more information about this post, please contact Bob Cosgrove at rcosgrove@wcmlaw.com.

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