While staying at a resort, my friends and I rented jet skis.  I  crashed my ski into my friend’s while attempting to spray water on to him.  We inspected the skis and found a significant scratch on mine.  When we returned the skis, the lender did not seem to notice the damage.  I faced an ethical dilemma as to whether to mention the damage, which would oblige us to pay for it.  I chose to say nothing.

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About John Hooker

T. Jerome Holleran Professor of Business Ethics and Social Responsibility Tepper School of Business Carnegie Mellon University

5 responses »

  1. Veda says:

    Utilitarian Test: Your choice should create greater personal gain than the other options available. Since you are able to save money and not pay for the damages, choosing not to tell the owner passes this test.

    Generalization Test: The reason for your actions should be consistent with the assumption that everyone who is in the same situation would act in a similar manner.
    Your decision fails the test, because if everyone acted the way you did, it would be much more difficult for you to hide a damaged ski, or it would be much more difficult to rent skis in the first place.

    Your choice was unethical because it failed the generalization test.

  2. Sidharth says:

    Generalization test: You did not inform the vendor of the damage because you thought you could get away with it. But if everyone who thought that they could away with it failed to inform the vendor of the damage, then since vendors are bound to find out later, they will carefully examine the skis on return. This no longer will allow you or anyone else to get away with it. So your action fails the generalization test.

    Utilitarian test: By not informing the vendor about the damage on the skis, you saved money by not paying for the damage. You maximized your utility, because parting with your money would have reduced your utility. Hence your choice passes the utilitarian test.

    Virtue Test: If you uphold the virtue of being honest and ethical, your action would not have been consistent with your virtue, and hence this test would fail.

    In conclusion, this act would have to classified as unethical, because it must pass all three tests to be ethical.

  3. John Hooker says:

    Failure to mention the damage could be ungeneralizable because, if generalized, vendors may inspect returns more closely.

    The main problem, however, is that a rental agreement allows the renter to use an item in exchange for a rental fee, not to damage it as well (beyond ordinary wear and tear). Returning a damaged ski without compensation is violation of the agreement, whether or not the vendor is aware of the violation. Violation of agreements solely for personal gain is ungeneralizable. (A similar case is A Damaged Car, discussed in Video 4 [transcript] under How to analyze.)

    If the vendor is apprised of the damage and decides to waive any compensation, then there is no need to pay, because the parties have renegotiated the agreement by mutual consent.

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