Exam 3 scenarios Flashcards
Jane’s son is in the hospital to be operated on by Dr. T. Jane has medical insurance that will pay for the operation and for Dr. T’s service.
•Jane is distraught over the fact that her son is undergoing an operation. She begs the doctor to do his best and tells him that she will pay him $100,000 if the operation is successful and her child is safe.
The operation is successful. The mother is back to normal. T. asks for the $100,000. Does Jane have to pay T?
No. There is no contract since there is no consideration from T. Jane’s consideration is the offer to pay the money. T operated on the child. He had a pre existing duty to do that because of his work. He can’t claim to have been extra careful because of the promise. He was supposed to be extra careful regardless. Therefore, there is no contract due to lack of consideration from Dr. T.
Let’s say Jay Leno had a Discover card. He owed $10,000 on it. He decided not to make any payments on it. After failing to collect on the account, Discover sells the account to a debt collection agency. Debt collection agency contacts Jay and he says that he will pay them $5,000 to settle the claim. Collection company says fine- takes the money. Then 3 months later hits Jay with a debt collection lawsuit for the remaining $5,000. Can the company do that?
Yes they can and there reason is that Jay’s debt is undisputed debt.
•The question to ask in debt settlement situations is whether the debt was disputed or undisputed.
•If the debt was disputed, then the settlement of the disputed debt discharged the balance.
•If the debt was undisputed, then the settlement of the disputed debt for an amount less than owed does not discharge the balance.
