Question

Patty and Mario dispute whether Patty owes Mario 1,000. Patty asks Mario if she can give him her gold necklace, worth500, in full payment of the debt. Mario agrees and takes the gold necklace. Which of the following is true?

1) Patty still owes Mario $500 after giving him the gold necklace.
2) Mario taking the necklace constitutes an accord and satisfaction.
3) Patty has committed fraud.
4) Mario must give the necklace back to Patty.

Answer 1

Mario's acceptance of Patty's gold necklace as full payment for the debt is an example of accord and satisfaction, meaning Patty no longer owes Mario the remaining $500.

Step-by-step explanation:

The situation between Patty and Mario involves a legal concept known as accord and satisfaction, which is a type of contract modification or dispute resolution. When Patty offered her gold necklace worth $500 to Mario in full payment of the $1000 debt, and Mario agreed to accept it as full payment, they effectively created an accord (a new agreement). The satisfaction occurs when Patty actually gives the gold necklace to Mario, which settles the original obligation.

Therefore, the correct answer to the question is that Mario taking the necklace constitutes an accord and satisfaction. Patty no longer owes Mario the remaining $500, since they both agreed that the gold necklace would suffice as full settlement of the debt.