Pre-existing Duty Rule Flashcards
What is the pre-existing duty rule?
A pre-existing duty legal duty made by a previous contract when a party attempts to renegotiate.
This is created when a party merely does what he was already obligated to do, then he cannot demand an additional compensation. Even if they attempt to take advantage of the necessities of his adversary, he obtained a promise for more, the law will regard it as void.
Pre-existing Duty Rule
What happened in Alaska Packers v. Domenico?
They had contracted the sailors to work from San Francisco to Alaska catching a certain type of fish. When the group reached Alaska, they went on strike to demand more money. The other party did not have any other options but to pay them, so the ships captain agreed. The court ruled that they could not be given more money because Domenico did not have consideration in the second agreement.
Pre-existing duty Rule
The rule about Rescission and modification from Watkins v. Carrig
The parties had a previous agreement but when a new issue arose, they both agreed to change the rate and the contract. Because Watkins gave up his legal right to enforce the previous agreement because they both assented to a new one, with new terms, there was new consideration on both sides and the agreement was enforceable. If Watkins had told Carrig no to a new deal, then Carrig would not be able to back out without legal consequence.
Pre-existing duty rule
What is “New Consideration?” and the strange quote about the horse, hawk, or robe indicate?
“By no possibility, a lesser sum can be satisfaction to the P for a greater sum: but the gift of a horse, hawk, or robe in satisfaction is good.”
This indicates that if A owes B $50 and agrees to pay on 1st of May, A cannot come to B and pay him $38 dollars, even if B agrees to it. But if B said “Rather than pay me $50 back on the 1st, pay me $38 on the 31st of April instead” this would be valid.
