I. GENERAL CONSIDERATIONS
§ 246:1 Introductory comments
Tender is an unconditional offer by a tenderer to pay an amount in lawful currency that is at least equal to the amount owing in a specified debt, or to present a specific article in discharge of an obligation. The purpose of tender is to close a transaction so that the tenderer may be relieved of further liability for the debt or obligation. The effect of an unjustifiable refusal of a sufficient tender is to place the refusing party in default, which permits the tenderer to exercise his or her remedy of breach of contract. (1)
An effective tender requires that the money or article tendered be physically produced, actually shown and willingly offered to the obligee. (2) If the obligee rejects the tender, the obligee must do so within a reasonable time after the tender has been offered, and the obligee must give specific reasons for the rejection of the tender. (3)
Reminder: Although an effective tender that is not accepted by the refusing party prevents the accrual of further interest, (4) costs, penalties and attorney fees, (5) it does not extinguish the principal debt or obligation. (6)
In the absence of an agreement to the contrary, the sole medium of payment for an effective tender is money. (7) For an effective tender, the entire amount due on the debt, including accrued interest, costs, penalties and attorney fees, must be tendered. The tenderer may tender more than the amount due if the tenderer does not demand change, but if the tenderer demands change as a condition precedent to giving up the amount tendered, the tender is ineffective. (8)
17 Am Jur 2d Legal Forms, § 246:1, 1995, p. 701.
American Jurisprudence Index