The North Carolina Legislature recently amended its accord and
satisfaction law to include creditor-friendly revisions that make
it easier for creditors to avoid inadvertently discharging a
disputed debt. Effective October 1, 2016, S.L. 2016-52 was enacted
to conform North Carolina's accord and satisfaction law to the
corresponding provision of the Uniform Commercial Code, Section
3-311(c)(2), and allows a creditor to reinstate a debt that was
paid in full satisfaction by a debtor; provided that the creditor
repays such amount within 90 days and the debt payment was not
tendered to a person, office, or place designated by the creditor
under N.C.G.S. 25-3-311(c)(1).
Under North Carolina law, a debtor can satisfy a disputed debt
if the debtor tenders to a creditor, and the creditor accepts such
tender, a payment that is clearly communicated to be in full
satisfaction of the disputed debt. The widespread use of automated
check processing systems increased the risk that creditors would
inadvertently accept such payments and accidentally discharge a
disputed debt. This amendment provides recourse for creditors who
fall victim to such a scenario and significantly reduces the risk
of inadvertent discharge.
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