Yes they can. For example a lot of shops will refuse £50 notes which are also legal tender. Legal tender means they can't refuse it as settlement of a debt, so for example a petrol station can't refuse it, because you have filled up your tank and you a required to pay for it. However if you take stuff to the till in a shop, you are not obliged to buy it, and the shop is not obliged to sell it, so there is no debt.