By Jeanne Fleming, Ph.D. and Leonard Schwarz

Question: My fiancé’s wealthy aunt and uncle agreed to let us use their beautiful lake-view home for our wedding, and we’ve sent out the invitations. But now they’re insisting that each guest sign a form releasing them from any liability in the event of an accident. I’m appalled. Are they being unreasonable, or am I just naive?

Answer: You’re naïve only if you imagine that liability isn’t an issue here, because it is. Too bad no one thought of it before the invitations went out. We’d place most of the blame for that on your fiancé’s aunt and uncle, as presumably they’re worldlier, as well as wealthier, than you. But we can’t blame them for getting nervous, especially if you’re planning to serve alcohol.

So where do you go from here? These folks are sure to have homeowners’ insurance, and it almost certainly covers personal liability. If they don’t realize this, a call to their insurance agent may put their minds at ease.

If it doesn’t, talk to your insurance agent about “special events coverage.” A one day policy will insure your fiancé’s aunt and uncle against any liability arising from your wedding and will cost you a lot less than a ballroom or banquet hall.

If neither of these approaches satisfies them, then we’d agree: Your fiancé’s relatives are being unreasonable. It’s one thing to be more-than-a-little late in raising the liability issue. But once the invitations go out, it’s wrong to insist that your guests sign the kind of legal document they might expect to be handed were they signing up for skydiving lessons, not attending a wedding.
Questions? Email Money Magazine’s ethicists – authors of “Isn’t It Their Turn to Pick Up the Check?” (Free Press) – at FlemingandSchwarz@right-thing.net.

by JEANNE FLEMING, PH.D. and LEONARD SCHWARZ

Question: My brother-in-law recently asked me to lend him $10,000 to tide him over till he finds a new job. He’s offered me a second mortgage as security, but I doubt there’s ten grand of equity left in his house, plus it’s a trophy property they never really could afford. Still, I don’t want my sister to lose her home. What should I do?

Answer: The first rule of family finance: Never allow your siblings and their spouses to buy houses they can’t afford. Now if only it were enforceable.

From what you say, it sounds as if your sister and her husband were living beyond their means before he lost his job. So regardless of whether the economy turns around and regardless of when your brother-in-law is able to find work, it’s hard to believe that the probability of his being able to repay you isn’t a whole lot lower than the probability that he’s going to need to borrow more money in order to stay in that home.

The bottom line? If your sister and her husband own a place they can’t afford, lending them money isn’t bailing them out, it’s only postponing the inevitable. So unless you can afford to subsidize them indefinitely while they live in their trophy property —- and unless you and your family are happy to do so -— don’t lend them the dough.

We know, it’s your sister. But that’s why you need to hang on to your money: to help her and her husband get back on their feet once they move to a home they can actually afford.

Questions? Email Money Magazine’s ethicists – authors of “Isn’t It Their Turn to Pick Up the Check?” (Free Press) – at FlemingandSchwarz@right-thing.net.

by JEANNE FLEMING, PH.D. and LEONARD SCHWARZ

Question: When my father-in-law learned we were planning to move to a community with better schools, he said he’d send our sons to parochial schools here. He paid for their first semester, but hasn’t paid since. Doesn’t he have an obligation to honor this commitment? He’s not hurting for money, and we stayed because of his promise.

Answer: We sure hope you’re not counting on your father-in-law to help send your boys to college (and we’re not kidding).

Breaking a promise is, of course, never a nice thing to do. But the extent to which it’s simply crummy as opposed to seriously unethical depends on two things: 1) the degree to which the promise involves a quid pro quo and 2) the degree to which the recipient of the promise is hurt when the promise-maker reneges.

So, on the quid pro quo front, did your father-in-law agree to pay the tuition in return for your agreeing not to move? If he did, he has a moral obligation to honor his commitment (assuming he hasn’t suffered a serious financial setback in the interim). He’s obligated, that is, unless his failure to pay has had no real consequences for you and your family. You make the point that your father-in-law isn’t hurting for money, but how about you? If you can afford the tuition as easily as he can but you just don’t want to pay it, then his failure to keep his word, while unequivocally dishonorable, is not such a terrible ethical breech.

Questions? Email Money Magazine’s ethicists – authors of “Isn’t It Their Turn to Pick Up the Check?” (Free Press) – at FlemingandSchwarz@right-thing.net.

by JEANNE FLEMING, PH.D. and LEONARD SCHWARZ

Question: Before my son got married, my wife and I told his fiancée's parents that, in addition to hosting the rehearsal dinner, we'd pay for one-third of the cost of the wedding (we had a general sense of the overall budget). They were very appreciative and agreed to send us an accounting of expenses post-event. Well, we've received it, and it looks to us as if they padded the bill. What should we do?

Answer: Be grateful you didn't offer to pay for half.

Seriously, the first thing to do is everything that discretion allows to determine the actual cost of the event. That means calling all the service providers involved – the caterer, the florist, the band and everyone else – and asking what each of them would charge for a wedding like your son's. In short, nail down the numbers.

Then if they don't add up, say to the bride's parents in your most apologetic voice, "I'm just wondering if there's been some sort of error. We'd been expecting the wedding to cost around [whatever you believe it actually cost]. Could you double-check the math to be certain there's been no mistake?" In other words, without being accusatory, give them a face-saving opportunity to adjust the bill.

And if they don't? While it's perfectly ethical to challenge any bill you believe to be incorrect, you have another obligation here: to support your son's marriage. For the sake of family harmony, hold your nose, write the check and keep your suspicions to yourselves. But never agree to share the cost of anything with these people in the future.

Questions? Email Money Magazine’s ethicists – authors of “Isn’t It Their Turn to Pick Up the Check?” (Free Press) – at FlemingandSchwarz@right-thing.net.

by JEANNE FLEMING, PH.D. and LEONARD SCHWARZ

Question: For five years I worked for my sister’s husband Jeff at the market research firm he owns. A year after I quit, I started a research firm of my own. I’ve abided by the terms of my contract with Jeff, but my whole family is mad at me because now I’m competing with Jeff for business. Are they right? Just because he once gave me a job, am I obligated to get this guy’s approval for every move I make?

Answer: That depends. If Jeff did you a favor by hiring you – if you got the job because you’re family – then competing with him now is an act of betrayal. In accepting a favor of that magnitude, you incurred an obligation to treat Jeff as more than an employer with whom your relationship was arm’s length. Of course he has no right to oversee your career, but he has good reason to expect you not to start a competing enterprise.

On the other hand, if Jeff hired you simply because he valued you as an employee, he’s on thin ice insisting you have obligations that extend beyond the employment contract you signed. Had he expected you to never compete with him, he should have specified that in the contract. In short, if your hiring was strictly business and you’re playing by the rules Jeff spelled out, his outrage is unwarranted.

So what was it, personal or business? Therein lies one answer to your question. Either way, though, you’ve shown a remarkable lack of family loyalty in starting a business aimed at taking customers from your brother-in-law and bread off your sister’s family’s table. Any way you slice it, that’s a hostile act.

Questions? Email Money Magazine’s ethicists – authors of “Isn’t It Their Turn to Pick Up the Check?” (Free Press) – at FlemingandSchwarz@right-thing.net.