Am I liable to pay a loanthatI took out for services that were only partially provided by a company that has just filed for bankruptcy?

UPDATED: Jan 6, 2011

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Am I liable to pay a loanthatI took out for services that were only partially provided by a company that has just filed for bankruptcy?

I contracted with a dental group to have dental work done. In order to pay them, I signed a contract with a separate financing company for the full amount. Now that the dental group has closed and will probably file for bankruptcy, I will not be able to receive the rest of my services, which are about 1/2 done. I have filed a dispute with the finance company and WI state consumer protection about this. As of now, I have paid the finance company about 1/2 the amount owed. Am I liable for the remainder, even though I know I will never receive the services contracted for? Any suggestions?

Asked on January 6, 2011 under Bankruptcy Law, Wisconsin


M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

Well you definitely took a good first few steps by filing a dispute and with your state consumer protection agency (is that the same as the Attorney General's office as well?) but I really think that you should have the agreement reviewed by an attorney on your behalf.   I am hoping that the agreement has a contingency clause in it, meaning that payment would be contingent upon the services rendered by the dental group.  If it does not have one I am pretty certain that any Judge would assume that it is contained in the agreement (even though they are not supposed to really read in to contracts) and that it would be found to be a condition precedent to payment.  Make sure, though, that that financing company does not file anything with the credit bureaus for non-payment here.  Good luck.

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