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Death & Credit Cards Christopher Jenkins MBA530-01 06/09/2019

Published on Jun 09, 2019

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1.

Death & Credit Cards
Christopher Jenkins
MBA530-01
06/09/2019

Photo by Samson Creative.
2.

The Rundown

  • Knutson took out a credit card in Dennegar's name without his consent.
  • Though Knutson was able to write checks for Dennegar, it was still Dennegar's responsibility to monitor his account
  • Knutson passed away and left a massive debt under Dennegar's name.
  • A financial institution acquired the account and is holding Dennegar responsible despite apparent credit card fraud.
  • Unfortunately, this case is similar to others in that credit cards were unknowingly opened under their name. "I know of three personal contacts (one degree) that have been victims of identify fraud. The first had his credit card statement stolen from his garbage. The thief subsequently called the credit card company and told them "he" had moved and lost the card. The credit card company issued a new card and sent it to the "new" address. Thousands of dollars were charged at high-end downtown Toronto clothing stores before the thief was caught" (Identity, 2014)
3.

Laws of Agency

  • Though it is a general term, the laws of agency applies in this scenario. There was never a written document between Dennegar & Knutson, but Knutson acted as a financial agent for most of the household bills.
  • We can look further into the scope of authority t see whether or not Knutson had authority to open the credit card on behalf of Dennegar
  • "By characterizing an agent as person who “acts on behalf of” a principal, agency law positions the agent as the principal’s representative for purposes of legally-salient interactions with third parties and facts about the world. An agent serves as an extension of the principal, and not, as is true of some fiduciaries, a substitute charged to act in the best interests of the beneficiary of the relationship. Thus, the principal’s continuing existence is requisite to an ongoing agency relationship" (DeMott, 2016)
4.

Scope of Authority

  • To understand the scope of authority, it simply states that any person deemed an agent then has the authority to carry out various tasks that have been delegated.
  • For this case, there was no written consent, but there was a version of implied cauthority since Dennegar placed the household financials under Knutson's care.
  • The issue with implied consent is that it does not protect the individual, but rather protects the third party involved and their investment.
  • "Authority consists in having standing to make a claim on another person's actions. Authority comes in degrees: persons have the authority to make moral demands on each other, but if they participate in close relationships, such as friendships or love relationships, their authority over each other is greater, compared to the authority of strangers to make demands, as participants in personal relationships can demand more from each other than can strangers" (Loschke, 2015).
5.

The Verdict

  • Although it was considered malice when Knutson opened the credit card, there would be a better argument if he was still alive. Unfortunately, due to his death, the financial institution has the authority to charge Dennegar for the bill regardless of his lack of knowledge. Contract laws, especially agency laws, protect third parties from losing any monetary value.
  • It has long been said that friendships/roommates are the first to mess with anyone's finances if given the chance. Here, Dennegar trusted Knutson, but is now paying an extremely high price for his transgressions.
  • "Maybe you don’t lend money but instead lend time or other resources like a place to crash. Once you become a lender (or lendee) this new relationship model opens up lines of inquiry into you or your friend’s personal finances, and you won’t be able to keep from noticing other money behaviors. Which is exactly what happened to me the first time I mixed friendship and finance" (Bowling, 2017)
6.

References

Chris Jenkins

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