C,a neighbour of D,wished to borrow a sum of money from a local bank.D was quite wealthy but elderly,with very poor eye sight.He frequently requested C to read his newspaper to him when C would drop by for a visit because reading was exceedingly difficult for him. One evening,C placed a paper before D and explained to him that he wished to borrow a sum of money but required a letter of reference before the bank would make the loan.He requested D to sign to the paper to satisfy this requirement.D trusted his friend C,and signed the paper at his request without reading it.
Unknown to D,the paper was a guarantee of C's indebtedness,and not a letter of reference,and C later defaulted on his debt.

Question

Quizplus · Accepted Answer

Option A is correct because D did not knowingly sign a guarantee of C's indebtedness and can therefore argue that he did not understand the nature and effect of the document he signed. This defence is known as non est factum, which means "it is not my deed."

Option B is incorrect because the amount stated on the document is not relevant to the defence of non est factum. The defence is based on whether the signatory understood the nature and effect of the document, not on its contents.

Option C is partially correct because a guarantee must be in writing and signed to be legally enforceable. However, C did not require D's signature because of the Statute of Frauds; he requested it to deceive the bank and secure the loan.

Therefore, the best choice is option D, as it correctly explains the defence of non est factum as well as the motive behind C's request for D's signature.

C,a Neighbour of D,wished to Borrow a Sum of Money