Question

Holly had a hair and nails store. She bought most of her stuff from Sally's beauty supplies. Holly fell behind on bills and Sally's said they would extend no more credit to her. The same day, Holly's father came and SAID he would pay for anything Holly needed. Based on her father's statement, Sally's gave Holly credit and Holly ran up in $5,000 in goods. Sally's sued. Will she win?

Answer 1

Based on the father's statement, Sally's is unlikely to win the lawsuit against Holly for the $5,000 debt.

Step-by-step explanation:

In this scenario, it is unlikely that Sally's beauty supplies would win the lawsuit against Holly. This is because Holly's father made a clear and explicit statement that he would pay for anything Holly needed. Based on this statement, Sally's gave Holly credit, and Holly subsequently ran up a debt of $5,000. Since Sally's had knowledge of Holly's father's promise, they accepted the risk of extending credit to Holly. Therefore, it would be difficult for Sally's to argue that they should not be held responsible for the debt.