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V. ANSWERS TO PROBLEMS AND PROBLEM
CASES:
1. Yes. The court held that a surety has a defense against performance of his obligation if
the
creditor failed to disclose facts that materially increased the surety's risk. Here, the creditor was in
2. Yes. The court held that the release of the security greatly increased Garren's risk as surety.
The
law traditionally has held that where the creditor engages in conduct that increases the
surety's
3. Yes. As a co-signer on the loan, Babcock was an accommodation party which gave her a right
of
4. Yes. While Allen's was not entitled to a common law artisan's lien because it had not
added
value to the truck, it was entitled to a common law lien for its towing services as a
common
5. Yes. The court held that the Behs were personally liable for the second trust. When
they
purchased the property, they agreed to assume the Gromer's obligation to pay the second trust
to
Chapter 28 - Introduction to Credit and Secured
Transactions
28-7
© 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in
any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or
part.
6. The clause contemplates the private power of sale rather than a sale under judicial auspices.
It is
7. Yes. The court said that Miller was within her rights under the land contract even though only
a
8. No. The court held that the Collins's property was not subject to a
mechanic's
lien. A
person
claiming a lien must show that materials he furnished went into construction of a building on
the
