If you owe Mr. Storr $900 for goods received and Mr. Storr agrees to take $800 in full satisfaction of the debt, which of the following is true?
A) At common law, such a one-sided promise is always binding and Mr. Storr could sue for the remaining $100.
B) Many jurisdictions have passed legislation preventing Mr. Storr from suing you for the difference if he actually takes the $800.
C) The issue of consideration is irrelevant when dealing with satisfaction of a debt.
D) Even if you take the $800 to him, Mr. Storr can later sue you for the $100 on the principle of quantum meruit.
E) Under these circumstances, you only have to pay a reasonable price for the goods.

Question

Quizplus · Accepted Answer

Many jurisdictions have recognized the practical need to allow for the settlement of debts for less than the full amount owed, and have passed legislation to prevent creditors from suing for the difference once they have agreed to accept a lesser amount in full satisfaction of the debt. This prevents creditors from going back on their word after a settlement has been reached, providing debtors with a level of certainty and finality in their agreements.

If You Owe Mr