Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

Butch is a student at Sundance University. To pay his tuition costs, Butch asks Etta's Loans Inc. for a loan. Etta's agrees if Butch will

Butch is a student at Sundance University. To pay his tuition costs, Butch asks Etta's Loans Inc. for a loan. Etta's agrees if Butch will have a financially responsible party guarantee the loan payments. Harriman, a well-known businessman and a friend of Butch's family, calls Etta's and agrees to pay the loan if Butch cannot. Because of Harriman's reputation, the loan is made. Butch is making the payments, but because of illness he is unable to work for one month, He asks Etta's to extend the loan for three months. The lender agrees, raising the interest rate for the extended period. Harriman is not notified of the extension (and thus has not consented to it). One month later, Butch drops out of school. All attempts to collect the remainder of the loan from Butch fail. Can Etta's assert a claim against Harriman on the debt? Explain why and/or why not, referring to the appropriate terms and rights of the parties

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Construction accounting and financial management

Authors: Steven j. Peterson

2nd Edition

978-0135017111