Cengage Advantage Books: Law for Business 18th Edition by John Ashcroft ,Janet Ashcroft

Exercise 4

Kathryn and Ronald Frazier signed a note to pay Philip O'Malley $27,000 with 14 percent interest in ninety days. The Fraziers made some interest payments, and Ronald frequently told O'Malley he would pay the principal. Thirteen years after the last interest payment, Ronald delivered a check for $5,000 signed by Kathryn to O'Malley. A few months later, Ronald offered to pay O'Malley $22,000 for a release acknowledging no further obligation on the debt. O'Malley refused and sued the Fraziers. At the time Ronald paid the $5,000, the five-year statute of limitations had run on the debt. Decide the case.