Paying a debt "in full"

[panache45]

If a creditor is sent a check marked “paid in full,” and he cashes it, how legally binding is this? Can he still demand the remainder of the debt?

[ouryL]

nada, zip, zilch

Paid in full written by the debtor, now that’s a different thing.

[Garfield226]

@panache45

If a creditor is sent a check marked “paid in full,” and he cashes it, how legally binding is this? Can he still demand the remainder of the debt?

Slightly contradictory evidence (in my mind, at least) from snopes. They say the notion is ridiculous, but then there’s this:

Section 3-311 of the Uniform Commercial Code does state that a debt can be discharged with a check designated as payment in full “if the person against whom the claim is asserted proves that the instrument or an accompanying written communication contained a conspicuous statement to the effect that the instrument was tendered as full satisfaction of the claim.” However, it’s up to the claimant to prove “that within a reasonable time before collection of the instrument was initiated, the claimant, or an agent of the claimant having direct responsibility with respect to the disputed obligation, knew that the instrument was tendered in full satisfaction of the claim.” So if you receive a check marked “paid in full” made out for less than the amount you have agreed upon, you’d best not cross out the words “paid in full” or write “disputed” on it and cash it anyway, as you risk having the entire debt discharged.