LIMITS ON ENFORCEABILITY Flashcards
PRE-EXISITING DUTY RULE
A principle under contract lawa that states that if a party to a contract is under a pre-existing duty to perform, then no consideration is given for any modification of the contract and the modification is therefore voidable.
“A party cannot lay the foundation of an estoppel by his own wrong, where the promise is simply a repetition of subsisting legal promise. . . . The promise cannot be enforced although the other party complete his contract in reliance upon it” (Alaska Packers).
EXCEPTION TO PRE-EXIST. DUTY: RESCISSION
Parties to a contract may agree to rescind that contract and then, free from any obligations to each other, they may enter into another contract on any terms they choose.
This scenario includes three separate contracts– the first contract that is still executory, the second contract of rescission which discharges the first contract, and the third contract allowing for new (additional) compensation.
DURESS
Where one party compels another party to enter into a contract against their will or judgment by threats to harm them for noncompliance.
To give rise to a defense of duress, the threat must be sufficiently severe that it deprives the victim of free will and no reasonable alternative (existing legal process must be inadequate).
Traditionally, the threat also had to involve one of certain criminal acts. Modernly, however, the threat must merely be “wrongful” and “overcome the free will of a party.”
Statements to exercise contractual remedies do not count unless the other party had engaged in some lawful mitigation.
UNDUE INFLUENCE
