Business 8th Edition by Marianne Jennings

Exercise 24

In 1984, Jean Mayes purchased Albert L. Silva, d\b\a Rainbow Motors, a Nantucket car dealership. In May 1985, Mr. Mayes entered into financing arrangements with Chrysler Credit Corporation to finance his car inventory. The borrower was Rainbow Motors, with Mr. Mayes as president and sole shareholder.
Chrysler demanded that Mr. Mayes and his wife, Michele Mayes, sign a "continuing guaranty" before it would extend credit. Mrs. Mayes, a well-compensated corporate attorney, was listed as a director and officer of Rainbow, but she did not participate in managing it. Rainbow defaulted, and Chrysler brought suit against Mrs. Mayes, seeking $750,126.41. Mrs. Mayes said Chrysler was stopped from collecting the debt because of the ECOA. Is she correct? [ Mayes v Chrysler Credit Corp., 37 F.3d 9 (1st Cir. 1994)]