Deposit of Insurer’s Check Constitutes Acceptance of Settlement Offer, N.J. Federal Judge Rules

NEWARK, N.J. — The doctrine of accord and satisfaction bars bad faith and breach of contract claims asserted against an insurer in a Superstorm Sandy coverage case because the policyholders deposited the insurer’s check, which had been accompanied by a settlement letter, a New Jersey federal judge has ruled.

In a Sept. 18 order, Judge Esther Salas of the U.S. District Court for the District of New Jersey explained that “when a check is tendered as payment for an unliquidated claim on the condition that it be accepted in full payment, the creditor is deemed to have accepted this condition …