Payment Systems: Effect of the Instrument on the Underlying Obligation Podcast
The topic of this podcast is the relationship between the liability that parties have on an underlying contractual obligation and an instrument that is taken as payment for the same obligation, including using an instrument to achieve an accord and satisfaction as to a contractual dispute. For example, an individual enters into a contract for a large item such as a car and takes out a loan for payment, signing a promissory note. Similarly, an individual might contract to purchase routine goods and services, but be dissatisfied with the performance and want to write a check for an amount less than the total owed as an accord and satisfaction of the dispute. This podcast will focus on rules §§ 3-310-311. At the conclusion of this podcasts you should be able to (1) describe the effect on the underlying obligation when an obligee takes an instrument as payment; and (2) identify when there is an accord and satisfaction obtained by using an instrument.