Question

Seaver Books, a small book publishing company, wrote off the debt of The Learning Center, and the Academy of Basic Education, both small private schools, after it determined that the schools were facing serious financial difficulty. No notice of the action was sent to the schools; Seaver Books simply stopped sending bills. Nearly a year later, The Learning Center was given a large endowment and a government grant. The resulting publicity brought the school to the attention of Seaver Books, which immediately reinstated the account, and sent a new bill to the school, including interest for the entire time the debt was outstanding. No further action was taken regarding the Academy of Basic Education, which was still operational.

Required:

Did Seaver Books act ethically in reinstating the debt of one client, and not the other? Explain.

Answer 1

Seaver Books didnt act ethically in reinstating the debt. Even though they have decided to write off the debt of both the schools, there was no proper communication to the schools regarding the writing off of debts. More over they didnt communicate with both the schools if any case they need to pay back the debt in future.

Here Seaver Books has decided to reinstate the debts with interest after hearing that the Learning Center was given a large government grant. But if they have communicated the schools regarding the writing off of the debt and under what circumstances the debts will be reinstated, it would have been ethical. Since no communication was done on this end, the decision was not ethical.