Reference no: EM133376740
Purvis, a twenty-one-year-old college senior, loved cars. Bank had extended him a two-year loan with no pre-payment penalty to purchase a firefly car. . Purvis fell behind in his payments prompting Bank to write him a letter stating, "If payments are not resumed by January 15, we will be forced to repossess your Firefly. Purvis dropped out of school to work long hours at Staples BBQ restaurant, so that he would be able to resume his payments.
On January 6, Purvis's Aunt Mattie, a fifty-five-year-old real estate tycoon, discovered Purvis's plans to pay his debt. She called him on his cell phone and said "I can't let my favorite nephew mess up his life. If you stay in school and quit your part-time job I will assume all payments on your car and provide you with $200 spending money every month until next May." Purvis agreed to quit his job and stay in school.
Mattie called Bank and left a message with the receptionist stating, "I will pay you all the money Purvis owes and assume all his future payments if you guarantee not to reposes his car. If Bank does not return my call, I will assume he has accepted the offer".
Bank did not respond to Mattie's call, did not repossess the car, and cashed Mattie's checks over the next six months.
Purvis drove off the side of a winding mountain road four months before his graduation from college. He totaled the car and sadly passed away from injuries that he sustained from the accident. Bank sued Mattie for the remaining payments due on the car. Purvis's estate brought suit against Mattie for six remaining monthly payments of $200 spending money promised to Purvis.
Questions
1. Was a valid agreement formulated between Purvis and Bank? Explain your rationale
2. Was a valid agreement formulated between Purvis and his Aunt Mattie? Explain your rationale
3. Can Purvis's estate prevail in its suit against Aunt Mattie for six remaining monthly payment of $200? Explain your rational.
4. Will Bank prevail in its suit against Purvis Aunt Mattie for the remaining payments due on his car? Explain your rational.