COMPROMISING A CLAIM? DON'T RELY ON A "FULL AND FINAL SETTLEMENT" CHEQUE You dispute the amount of a claim made against you, and hand the creditor a cheque (for the lesser amount which you are prepared to pay), endorsed "in full and final settlement". You may think that, if the creditor accepts and deposits your cheque, the matter is now settled, and that there is no further claim against you. But a recent High Court judgment illustrates the danger of trying to compromise a claim in this way - in that case, there were two disputed contracts between the parties, and the debtor was unable to prove that his offer of compromise was in respect of both contracts. Our law requires that an offer of compromise be "strictly interpreted". It must be "clear and unambiguous" to be valid. As a result, making a compromise offer in "full and final settlement" may not be enough - the only truly safe option is to have your attorney make or deliver the payment for you, under cover of a properly-worded letter. Recent Articles for February 2010; Source: www.dotnews.co.za |
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