Welcome! My goal is to do my very best to understand your situation and to provide a full and complete answer for you.
Good morning. You do have a leg to stand on. Not only because they endorsed and cashed the check, but also because you wrote the check based upon your reliance upon their settlement agreement
that the amount paid would settle the matter. The lack of a written contract
can be overcome by the concept of promissory estoppel, detrimental reliance, and unjust enrichment. This situation arises when Person A relied upon the verbal agreement, Person A performed based on such reliance, and because Person B defaulted, such reliance is now to Person A's detriment. Where there is i) partial performance by Person A based upon the mutual promises, ii) Person A relied upon such promises to perform, iii) Person B's failure to perform would be to Person A's detriment, and iv) result in Person B being unjustly enriched, Person A can overcome the legal requirement that the agreement be in writing. You would want to write them a letter detailing both the facts and the foregoing and demanding they remove this negative credit report immediately. Let them know if they do not remove this within a short specified period of time, you will have no choice but to file breach of contract
claims against them for not only your actual damages, but punitive damages
as well. This should be all that's needed, but if not, file your claim in small claims
court. You don't need a lawyer to do that so it will cost you only a small filing fee.
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