After an accident with a driver for Onyx Security Company,Paul signs a covenant not to sue Onyx for damages in a tort action if it pays for the damage to his car. This covenant
A)bars recovery only if Onyx pays.
B)is an illusory contract.
C)is barred by the preexisting duty rule.
D)is unconscionable.

Question

Quizplus · Accepted Answer

A covenant not to sue is an agreement where one party promises not to bring a legal claim against another party. In this case, Paul has agreed not to sue Onyx for damages in exchange for Onyx paying for the damage to his car. This covenant is enforceable and will bar recovery only if Onyx pays.

After an Accident with a Driver for Onyx Security Company,Paul