BUSINESS ADMINISTRATION
BUSINESS LAW
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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If the debt is paid by the transfer of an asset to the creditor.
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If the debt is paid earlier than the due date.
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If the debt is paid by a bank transfer.
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If the debt is paid by credit card.
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Detailed explanation-1: -In debt recovery contract law, it is a general rule that an agreement that a debtor make a part payment of a debt will not satisfy the obligation to repay the entire debt. This is because there is no fresh consideration provided for the second agreement and is therefore not binding on the parties.
Detailed explanation-2: -It can be said that part payment of a debt is a benefit to the creditor rather than no payment at all. It can also be applied to a case where part payment has been made earlier than initially required. This would give no protection to a creditor if he wished to bring his case to court.
Detailed explanation-3: -Under Bargain-for-Exchange theory of consideration, adequate consideration exists when a promisor makes a promise in return for something else. Here, the essential condition is that the promisor was given something specifically to induce the promise being made.
Detailed explanation-4: - Liquidated Debt: A debt whose amount has been ascertained, fixed, agreed on, settled, or exactly determined.