Which of the following is a collateral promise?
A) A mother tells a merchant to extend $1,000 worth of credit to her son and says, "If he doesn't pay, I will."
B) Andrew promises Donald that if Donald cannot pay his bills, Andrew will.
C) A father tells a merchant to deliver a computer to his daughter and says, "Send me the bill. I'll pay for it."
D) All of these are collateral promises.

Question

Quizplus · Accepted Answer

A collateral promise involves a third party agreeing to pay a debt if the primary party fails to do so. In option A, the mother promises to pay if her son does not, which is a collateral promise.

Which of the Following Is a Collateral Promise