I have written " Payee agrees that cashing this check is payment in full for the account in question up to this date" Is this legally binding?
Not in your state, at least without additional qualifiers that are not included in your post.
See Calif. Civil Code sect. 1521 – 1526, which particular attention to 1525 and 26. You can find it here:
http://www.leginfo.ca.gov/calaw.html
If you and they meet all the requirements, it probably is, but you make no mention of advance written notice or acceptance or an agreement in writing. The inclusion of “up to this date” adds additional and confusing “wiggle room”. As SJ implies, it’s not clear from the post that the obligation is liquidated or unliquidated but “for the account in question” suggests it’s liquidated (meaning review 1525).
More businesses, especially bigger businesses, which regularly receive payments in volume, use P.O. lock boxes. While that may not be the case for you, permitting restrictive endorsements to work an "accord and satisfaction" has been increasingly limited. Using SJ's example, permitting a check for $1 marked "payment in full" to settle an established (liquidated) debt of $10,000 just doesn't make sense in this day and age. The check could go from the lock box to the creditor's bank account with no intention on the part of the creditor to settle, and the payor could argue that the debt has been paid. That won't happen.
