Consideration Flashcards
What is consideration?
a legal detriment or benefit provided to the other side.
Do conditional gifts have consideration?
No.
Adequacy of consideration
There must be some adequacy of consideration. There can be a difference in economic value. If the item has subjective equivalent value then it is ok.
Illusory Promise
A promisor’s action is subject to some item that she has complete control over such as feelings or taste.
Past consideratoin
Isn’t consideration
Promising not to sue
Will act as consideration as long as there is an honest belief in the validity of the claim.
What is the Pre-existing duty rule?
A promise to do something that you are already legally obligated to do by prior contract or otherwise isn’t consideration. Each side must give something for the modification.
What are the exceptions to the pre-existing duty rule?
A third party promising to pay or unforeseen difficulties that would excuse performance.
Is promising partial payment for release from a debt obligation binding?
Only if the debt is either not currently due or undisputed.
When is contract modification allowed in UCC world when there is no additional compensation?
When there is good faith between the parties.
Elements of Promissory Estoppel
1) Promise is made that would be reasonably expected to induce reliance.
2) Promisee takes detrimental action in reliance on the promise
3) Injustice can be avoided
How is promissory estoppel modified for charities?
They do not need to show detrimental reliance.
Elements of Quasi-Contract
1) Plaintiff confers a measurable benefit
2) Plaintiff reasonably expected to get paid
3) It would be unfair to let the defendant to keep the benefit without paying
What are the damages for quasi-contract?
Fair value of damages conferred
What is a moral obligation plus subsequent promise?
normally this is past consideration and non-binding but some jurisdictions allow these to be contracts.
