Threatening a suit - what are my rights?
We rented a house for over 2 years. There is a small attached garage apartment to the house we were renting. When the new tenant moved into the garage apt. the electric company goofed and switched off our electricity and began billing her our usage for 2 months. I received a final bill a month before we were to move out, so I figured it was just our final bill. Upon our move-out date and an inquiry to the landlord regarding our deposit amount, the garage apartment tenant provided me with 2 months of $200+ electric bills. The information is correct and we DO owe the amount. I have no problem paying the full amount that we owe. She has not had her own personal electric bill for 3 months now. She asked that we pay her, and we agreed, but I explained that I would have to pay her in two installments since the total amount was close to $500, and I don't exactly have an extra $500 laying around. She consulted a free attorney and threatened to sue me for the full amount PLUS attorney's fee and who knows what else she would come up with. If I don't have the money to pay her all at once (she didn't pay these bills all at once, she paid them over a period of two months), can she sue me? What are my rights in repaying her?
Thanks for any advice!