Consideration

Question 1

What does consideration require?

Answer 1

the exchange of something of value

Question 2

What are the types of consideration?

Answer 2

promise, act, forbearance

Question 3

What is a forbearance?

Answer 3

When a party refrains from an act

Question 4

When is the only time an illusory promise is valid consideration?

Answer 4

When each alternative performance is valid consideration on its own

Question 5

What are the circumstances in which modifications are valid under the preexisting duty rule?

Answer 5

unforeseen circumstances, altered performance of duties, sale of goods

Question 6

A ______ ______ that shocks the conscious may support a defense against enforceability, but is adequate consideration for a contract to be formed

Answer 6

gross inadequacy

Question 7

A ____ amount of consideration cannot form a contract if the bargain is a mere pretense

Answer 7

nominal

Question 8

An example of a ______ _______ of consideration that is a mere pretense is a mother wins the lottery and wishes to make a binding promise to give 1 million dollars to her daughter. The mother offers to buy a pencil (worth $1) from her daughter for $1 million. The daughter accepts, knowing that the bargain is a mere pretense. There is no contract due to the lack of consideration.

Answer 8

nominal amount

Question 9

___________ or ______ cannot support a contract is the promisor makes a promise in recognition of a benefit already conferred by the promisee

Answer 9

past consideration; moral obligation

Question 10

A stranger provides medical care for a sailor who has fallen ill. After the sailor dies, the sailor’s father promises to compensate the stranger for medical expenses incurred while caring for his son. Because the father’s promise is based solely on a ______ ________, there is no contract due to the lack of consideration

Answer 10

moral obligation

Question 11

The performance of a legal duty that is already owed is generally insufficient for ______

Answer 11

consideration

Question 12

A promise to perform an obligation that the promisor is already legally required to do _____ support a new, binding agreement (because it is not sufficient consideration)

Answer 12

cannot

Question 13

Under the preexisting duty rule, the ______ of a contract and the __________ without some additional consideration, may be unenforceable

Answer 13

modification; settlement of claims

Question 14

A modification to an existing contract is ______ without some new consideration unless an exception applies, such as the alteration of duties, and unforeseen circumstances.

Answer 14

unenforceable

Question 15

A modification to an existing contract is enforceable if the parties _____ their duties to be sufficient for additional consideration

Answer 15

alter

Question 16

A modification to an existing contract is enforceable if the modification is ___________ in light of circumstances that were unforeseen by the parties at the time of the contract

Answer 16

fair and equitable

Question 17

A modification to an existing contract for the sale of goods is ________ if it is made in good faith

Answer 17

enforceable