Stupid Question prob Re PFD ?

[xtrememom]

If I have a CA accept a PFD when I send them the Money Order or CAshiers Check is there any special Wording I need to put on it to preotect myself from them selling my account and sending me to collections for the balance which I understand is illegal in VA.

Thank you !

Xtrememom

[Debt Guy]

"special wording" on the check is not going to work -- as such is not legally binding in most states

You need to have a written agreement from the CA that outlines what the two of you have agreed to. I would encourage you to have this agreement in hand before you send money.

[2001Badyear]

I recall having read somewhere that Virginia is one of the states where the notaion is binding. Can't find it now to confirm though, and don't think that adding it can hurt either. Make sure you have a copy of it though.

[xtrememom]

I recall having read somewhere that Virginia is one of the states where the notaion is binding. Can't find it now to confirm though, and don't think that adding it can hurt either. Make sure you have a copy of it though.

Thats why I havent sent the money out yet as I read about the notation being binding in several places for VA, but I dont know what to write or where to write it and cant come up with wording for some reason in the last few days I get these brain fogs

Do I write it on the back where they endorse it something like "Cashing of this check constitutes payment in full for account" and list account number?

Does someone have any better suggestions what to write?

I am keeping every speck of paper on paper and scanning it all onto a CD which I have locked in a firesafe box just in case something bad were to happen, drives my friends and family nuts but my doing that has saved our backsides on more than one occassion I do it with everything, eob's, bank statements cancelled checks etc. Gotta have back-up never can have too much LOL

Thank You for your guidance.

xtrememom

[Debt Guy]

Mom

As I said earlier, the best advice is to get this agreement from the CA in writing. If they are serious, it is easy for them to fax you something in writing that says so.

If this is important to you, I don't understand why you are proceeding with the accord and satisfaction endorsement based on what "someone else thinks" and what "someone else heard".

I am not being disrespectful -- just challenging the thinking. Your business and your decision.

[ImaBird]

Do I write it on the back where they endorse it something like "Cashing of this check constitutes payment in full for account" and list account number?

Does someone have any better suggestions what to write?

I don't know about Virginia, but where I'm from, they can mark out whatever you write, and basically replace it with what they want, making it legal for them to pursue you for the "remaining balance".

I'm with Debt Guy on this one, but if you must, then do make sure you have a copy of the money order! (Don't send them a check!!!)

[kb9tbq]

RESTRICTIVE ENDORSEMENTS (RE)

There are 2 types of A&S that I will discuss here, one is for PAYMENT IN FULL on an account and the other is simply for PAYMENT in return for an action on their part. In order to offer a payment in full A&S, the payment should be a good faith payment. You will have to determine that amount but do not even think a judge will agree with $25.00 on a $5000.00 account. You must be very careful in the way your A&S is worded on the letter and on the actual instrument of accord (check or money order). In order for A&S to work completely and for it to stand up in court (if necessary) it must be determined that both parties agreed on it and that the A&S now supercedes any previous contract that may have existed between you and the CA, DC or Creditor.

The other type of A&S is for those of us who simply want our credit reports cleaned up quickly in order to qualify for a home or car. This A&S is a payment on the account, can be as little as $25.00 and requests that the DC, CA or Creditor request deletion of the account upon accepting the A&S (or even just update the account to a positive status). This works best with credit card companies and original creditors as they process payments en masse and very rarely pay attention to accompanying letters wit payments.

A&S is an ART form and must be treated very delicately. Some states allow CA, DC and Creditors to mark through a CE and write "under protest" or "without prejudice" and it voids the A&S completely, those states are listed below:

Alabama

Massachusetts

Missouri

New York

Rhode Island

South Dakota

Wisconsin

Delaware

Minnesota

New Hampshire

Ohio

South Carolina

West Virginia

Other states strictly enforce the legalities of Accord & Satisfaction and they are as follows:

Arkansas

Kansas

Louisiana

Maine

Nebraska

North Carolina

Pennsylvania

Utah

Virginia

Wyoming

Colorado

Connecticut

Georgia

Michigan

New Jersey

Oregon

Texas

Vermont

Washington

California is a whole different story when it comes to A&S. If the creditor, DC or CA you are wanting to execute a RE resides in California there are certain steps you must take before the A&S is legal.

First, you must notify the Creditor, CA or DC in writing that you are sending an instrument of A&S 15 days prior to you actually sending it. This 15 days gives the CA, DC or Creditor the option of refusing, objecting to or denying the A&S. If you have no response to the notice, you are free to send the A&S and even if they mark through it, they are still legally bound by it.

Your final alternative to these options is to simply start making payments on the debt that you cannot get settled. Start sending as much as you can each month, $25.00, $50.00 or whatever you can afford and keep sending those payments until you can afford to offer a lump sum payment on the account. Generally this will stop any Creditor from turning the account over to collections or pursuing a judgment against you.

This information comes from a site which is no longer around use to be called the faircreditmovement.

[Hellard]

not so great for me living in delaware- now i know why theres no sales tax here.. ha ha

[2001Badyear]

Here's an example of the Accord and Satisfaction endorsement and how a court ruled in Virginia. So what I said originally appears to hold water in Virginia, at least. OP, I'd have an agreement in writing and send check and letter with the A&S. Should it come to needing it later, you would have case law on your sdie as well it would seem. I would send a check, myself, because you would have the return/cancelled check as more for the file.

So not being disrespectful DebtGuy, but not just what "someone else thinks" and what "someone else heard".

Accord and Satisfaction Language Barred Contract Claim

By: J. Kent Holland, Jr., Esq.

Where a statement was conspicuously contained in a letter transmitting a check for final payment to a contractor stating that the check will constitute full satisfaction of a contractor claim, a court held this to be an accord and satisfaction, barring the contractor from claiming additional monies under its contract. In Gelles & Sons General Contracting, Inc. v. Jeffrey Stack, Inc. (No. 012319, Fairfax County, VA 2002), the contractor (“Gelles”) had performed brick laying work, and the its customer (“JSI”) took issue with the amount and quality of the work and disputed the amount of compensation due. The final paragraph of its letter transmitting the check in question stated, “JSI Paving and Construction stands by its final amounts as stated on the latest correspondence.... Enclosed, please find a check .... representing final payment of the contract.” Gelles cashed the check. Then Gelles sued JSI for the balance that it deemed owed. In response, JSI asked the court for summary judgment on the basis of accord and satisfaction. The court granted the summary judgment for several reasons.

Under the Virginia Code, section 8.3A-311, if a person tenders a payment instrument to a claimant as full satisfaction of the claim which was unliquidated or subject to a dispute, and the claimant obtained payment of the instrument [i.e., cashed the check], the following conditions apply. “ ... the claim is discharged 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.”

“Conspicuous,” as defined in the Code, means a term or clause that a reasonable person “ought to have noticed.” There is no statutory requirement that the term or clause must be displayed in a particular font or size type. Gelles argued that the language was ambiguous and would not lead a reasonable person to conclude that full satisfaction of the claim was intended. The trail court found that a reasonable person could not have considered the language of the letters to be anything other than “a drop-dead letter that says, ‘This is it. This is what we’re going to pay you.’” The appellate agreed that “the entire course of conduct and communication between these parties made clear that JSI offered the [amount] as the final payment that it intended to make and that JSI considered that amount to represent the proper accounting under the contract.”

Risk Management NOTE: I have had the experience while litigating a contractor claim to have a project owner successfully persuade a judge that through a combination of a change order, payment authorization, and partial waiver and lien release, the contractor had agreed to a total accord and satisfaction of any and all claims related to any work related to the change order. This came as a surprise to the contractor who never intended by signing the documents and cashing the check to waive its entitlement to the amount that it alleged to remain contested. Despite correspondence and documentation submitted to the owner by the contractor prior to the “accord and satisfaction,”demanding payment and seeking to preserve its rights, a court held that the subsequent contractor claim for the outstanding balance could be barred. The lesson learned is that language asserting a release and satisfaction must be taken most seriously, and, to assure that any right to a claim for additional monies is preserved, appropriate communication and action must be taken

[Debt Guy]

So not being disrespectful DebtGuy, but not just what "someone else thinks" and what "someone else heard".

That is my point exactly. Until you posted something definitive, it was purely speculation based on what someone else thought. I see a lot of that on the forum. As I continue to say, I am a cynic until I see it myself. I think others would be wise to adopt that mindset.

Taking for honest fact the article you posted, the "elephant in the room" question remains: If the CA ends up not honoring the verbal PFD agreement, which would you rather march into court and show a judge? A one page written and signed agreement on the letterhead of the CA? Or, a printout from the internet?

While either or both may prevail, there can clearly be no disagreement which would be the easier, cleaner and less expensive route.

Why make it hard on yourself?

[2001Badyear]

So not being disrespectful DebtGuy, but not just what "someone else thinks" and what "someone else heard".

That is my point exactly. Until you posted something definitive, it was purely speculation based on what someone else thought. I see a lot of that on the forum. As I continue to say, I am a cynic until I see it myself. I think others would be wise to adopt that mindset.

Taking for honest fact the article you posted, the "elephant in the room" question remains: If the CA ends up not honoring the verbal PFD agreement, which would you rather march into court and show a judge? A one page written and signed agreement on the letterhead of the CA? Or, a printout from the internet?

While either or both may prevail, there can clearly be no disagreement which would be the easier, cleaner and less expensive route.

Why make it hard on yourself?

Debtguy,

Seriously, you are the one that said "it isn't going to work" when in fact there is case law in this state that says to the contrary. Perhaps before posting your contrary view you may wish to find supporting evidence to back it up your opinion. It's not my job to do research for anyone here, but found it easy to find it when you made it sound as if you knew it wouldn't work.

I think CYA is appropriate in this situation, and you need not do so yourself, but careful advising to the OP to not do so, when in fact it can be shown to be legally binding, if done properly.

For the record, I did recall when I learned of this when I was involved in a lawsuit a few years back and we prevailed through the appeal level, and almost went to the VA Supremes, before they got spanked by the appelate judge in the final ruling of multiple counts. They withdrew the case from the Supremes and paid up. In the course of that battle, the defendant was forced to make payments and on one check (perhaps twice) they added a notation and we, based on attorney advice, rejected the check through their attorney. I asked our attorney "why" and that was something he explained was an issue in Virginia. I don't recall all the exact language, but recall having know that.

Seems my statement was at least based on fact and not opinion.

[flacorps]

The accord & satisfaction law mentioned by the person posting the list of states is very likely older statutes or even common law interpretations.

The UCC has, since the early 90s included section 3-311. It pretty much governs these days. Its terms are easy to look up, and it's easy to find out whether it has been enacted in your state.

There is a case in Virginia where it did NOT help the party that sent the check. Essentially, this was a case where an attorney tried to get cute and sent the amount of an offer that had been rejected the year before to a publicly supported hospital. The public fisc was at stake, and the court slapped his client down. I don't remember the cite right now.

An individual facing an OC, CA or JDB might do a bit better.

[Debt Guy]

BAD DOG

Let me refer you to my exact words in the original reply to the OP:

"special wording" on the check is not going to work -- as such is not legally binding in most states

Please note my qualifier that what the OP proposed does not work in most states.

I stand by that statement. I do not know much about VA and made no such claim. I do have hands on experience with A&S endorsements in seven other states and have actually had reason to research those state laws. Others started making claims about VA and I cautioned the OP.

I will state categorically that my experience with A&S endorsements would not be encouraging to the OP. Thus, my desire to not see someone inadvertently undermine what they were trying to accomplish -- especially so when there is a tried and true answer that is not complicated.

I've stubbed my toe enough to know that being right and winning the battle are not the same thing. I've lost battles that I should have won and I've won battles that were a lot more expensive than they needed to be. This experience leads me to the conviction that the simplest answer is often the least expensive and best.

I agree that neither you nor I are responsible to do the research that posters should be doing for themselves. Sometimes I have the time for it and will try to find something. Sometimes I just don't feel like it. I am pretty sure you feel the same way.

I don't really think this is something that we should be disagreeable over. Perhaps we just see things differently but still end up in the same place?

[2001Badyear]

DebtGuy,

With that, I believe we are in total agreement.

[hiblues]

what do you guys think of the wording of this RE on the back of a check:

You, (“you” means X company ), may use only this check to obtain funds from me, (“me”, “my” means **my name**), and you are strictly prohibited from using any other system, procedure, or scheme to withdraw funds from my account, and that by cashing this check you agree that you will NOT verify, re-verify re-report or update information regarding any of my accounts to the following credit reporting agencies, Experian, Equifax and Trans Union, for any reason except to delete the trade lines (items) from my credit reports. You agree, that both parties must agree upon any changes made to this agreement by initialing beside the strike-thru before a strike-thru can be made valid. You agree that you have been given ample notice of this restrictive endorsement. You agree that failure to follow thru with the above provisions will result in a charge to X company, equal to the amount of this check.

I have used it with success, meaning the CA deleted without a fight.

The thing is if it's a payment in full ( which I did) and all you are negotiating

is a delete...

then I ask.

what are the chances that a CA would defend themselves

in court if you sued them?

my thinking is that unless

you really pissed them off and they have a vengeance against you

I think its extremely unlikely that

they want to pay someone to go to small claims court

for such a piddly issue.

easier to just delete and have you go away.

I guess technically they could counter sue as frivolous,

but

again ( court is a crap shoot)

and they wouldn't risk it.

easier just to delete and have you vanish.

[Debt Guy]

what do you guys think of the wording of this RE on the back of a check:

HI

For my 2 cents, I don't feel comfortable with it for the reasons I have described earlier in the thread.

It may or may not work in some circumstances in some states on some days of the week. I just don't think the result is very predicable. I also think the expense and effort of trying to enforce the restrictive endorsement is burdensome. If it has worked with you before, I can only opine that you were lucky that the CA apparently did not care. For most CAs this is anathema.

Another thought that could potentially be an issue: I recall something in the new Federal Reserve check clearing rules that restricts the amount of space on the back of the check that can be used for the endorsement of the payee -- as I recall only the 1 1/2 inches at the left end of the reverse is available for that purpose. Look at the back of a check and you will see that dotted line that says "do not write, stamp or sign below this line".

The Fed is trying to keep the rest of the check "clean" so the endorsements of the intermediate clearing banks can be machine scanned and read -- in other words, if things are stamped on top of each other the item will not scan correctly.

Your endorsement is way too big to fit within the prescribed space - even in fly-speck font.

Now, I cannot tell you that the payee's bank would refuse to accept the check. But, if they are paying attention, they should since it would not meet the standards of the Fed.

[2001Badyear]

I can't answer with any authority on this, but agree that this is a lot to cram onto the back of the check. In the Virginia case, it says without regard to font type or size, which seems to mean it could be, in theory, microscopic. I also believe that this can and should be accompanied by a letter that sets the conditions by which cashing check "will constitute full satisfaction of a claim."

"Enclosed, please find a check .... representing final payment......."

See this part of VIRGINIA LAW:

Under the Virginia Code, section 8.3A-311, if a person tenders a payment instrument to a claimant as full satisfaction of the claim which was unliquidated or subject to a dispute, and the claimant obtained payment of the instrument [i.e., cashed the check], the following conditions apply. “ ... the claim is discharged 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.”

Conspicuous Statement seems to be key to this written communication. VIRGINIA LAW defines as:

“Conspicuous,” as defined in the Code, means a term or clause that a reasonable person “ought to have noticed.” There is no statutory requirement that the term or clause must be displayed in a particular font or size type.

So to be clear, this seems to have a basis in Virginia Law, but you might need to look at specific Hawaii law to see what might/might not work there. In Virginia at least, not all of that language is required on the check, but is present on the accompanied letter which references the check and stipulates the terms by which the "instrument" may be used (cashed).

I have not had to do so, to date, but if I ever did you could be sure I would carefully craft the wording, based on this and similiar case law, and consulation with an attorney. Lucky I know quite a few of those around here.

Either way, I think it can't hurt to include it, and they may not bother to look up the case law applicable and may just delete because they received the money. This is all predicated on the assumption that they do not do what they said, and you have to take them to court. I would think, if you have anything from them in written form about the communication between you, include (Enclosure) with the letter and you should have a pretty solid basis for court, assuming your state even allows this.

Again, I'm not a lawyer, so specific legal advice is not given here or implied.

Good luck.