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Business Law Today 8th Edition by Roger LeRoy Miller,Gaylord Jentz
Edition 8ISBN: 978-0324654554Business Law Today 8th Edition by Roger LeRoy Miller,Gaylord Jentz
Edition 8ISBN: 978-0324654554 Exercise 2
Java Jive, Inc., is a small chain of coffee shops. Adam is Java live's president.
Java Jive wants to borrow $30,000 from Eagle Credit Corp. to pay Java Jive employees. Java Jive believes that it will be able to repay the loan by the end of the month, which is when Macro Manufacturing Company has agreed to pay Java Jive for providing catering services at Macro's facilities. Eagle agrees to make the loan if Adam will sign a promise that if Java Jive defaults on the loan, Adam will be personally liable for the amount. Under these circumstances, is Adam a guarantor, a surety, or neither? If Adam orally promises to assume personal liability if Java Jive defaults, but he does not actually in anything, can Eagle enforce the promise?
Java Jive wants to borrow $30,000 from Eagle Credit Corp. to pay Java Jive employees. Java Jive believes that it will be able to repay the loan by the end of the month, which is when Macro Manufacturing Company has agreed to pay Java Jive for providing catering services at Macro's facilities. Eagle agrees to make the loan if Adam will sign a promise that if Java Jive defaults on the loan, Adam will be personally liable for the amount. Under these circumstances, is Adam a guarantor, a surety, or neither? If Adam orally promises to assume personal liability if Java Jive defaults, but he does not actually in anything, can Eagle enforce the promise?
Explanation
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Mr A is a guarantor as he will only make...
Business Law Today 8th Edition by Roger LeRoy Miller,Gaylord Jentz
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