Taylor, a Young Salesman with a Pharmaceutical Company, Wished to Purchase

Taylor, a young salesman with a pharmaceutical company, wished to purchase some furnishings for the new home he and his wife had recently acquired. To do so he visited a local branch of the Consumer Finance Co. Ltd. to arrange a suitable loan. Taylor made regular payments on the loan for a number of months. In September he received a promotional pamphlet from the finance company offering, as a Christmas bonus, three months relief of payments for October, November and December without interest or penalty charges. To obtain the benefit Taylor telephoned his loans officer and made the arrangements
In mid-December he received a call from the branch manager. He went to see the manager who told him he was in arrears for three months and, as far as the finance company was concerned, his loan contract was voided. The manager then gave him three choices: to pay the balance in full with interest and penalty charges, to sign a new loan contract with different terms, or do neither and be sued immediately. The manager also told Taylor that if he were sued, his credit rating would be destroyed and insisted that Taylor decide which choice he wanted before he left the office. Taylor did not have sufficient resources to pay the balance in full nor did he wish to be sued. He signed a new loan agreement with a substantially higher interest rate. Discuss the issues raised by this case. What are the rights and liabilities of the parties?