Consideration

Question 1

Promise is unenforceable unless it is supported by consideration

Answer 1

Bargain theory = promise is supported by consideration if based on a bargained for exchange

Bargained for exchange = something (goods or services) that was promised, and the promise must have been made in order to obtain something else of value.

Both parties are getting something that they’ve agreed to, usually something of value for something of value.

Question 2

Benefit/Detriment Test

Answer 2

Whether there is a benefit to the promisor and/or a detriment to the promise

Question 3

Legal detriment test

Answer 3

doing something he had a legal right not to do or foregoing some activity he HAD a legal right to do.

Question 4

Inadequacy of consideration

Answer 4

courts don’t police the equivalence or fairness of the exchange

Question 5

Illusory promise

Answer 5

Promise of performance that leaves performance to the unlimited discretion of the promising party-DOES NOT constitute consideration.

You agree to paint my portrait and i agree to buy it if I want to.

Question 6

Gratuitous Promises

Answer 6

Promise to make a gift, generally unenforceable due to insufficient consideration.

Exception: gratuitous transfers are legally binding.