When is a Promise Enforceable Under Contract Law?

Question 1

Generally, a promise requires consideration to be enforced

Answer 1

Hamer

RST 2d § 71

Question 2

Consideration Majority View: Bargained for performance or return promise (Bargain Theory)

Answer 2

RST 2d § 71

Question 3

Benefit to the promisor may provide a fair inference (but not conclusive) that a performance is induced rather than a mere condition

Answer 3

Pennsy

Question 4

Where a condition is merely necessary to the giving of a gift, it is considered a condition for a gratuitous promise, and not consideration

Answer 4

Tomczak

Question 5

Courts do not generally inquire into the adequacy of consideration

Answer 5

Batsakis, RST 2d § 79

Question 6

Forbearance from asserting legal claims is consideration so long as those claims were asserted in good faith (even if invalid)

Answer 6

Dyer, RST 2d § 74

Question 7

Nominal consideration may be insufficient to support a promise

Answer 7

Schnell

Question 8

Generally, Performance of a preexisting duty is not a valid consideration

Answer 8

RST 2d § 73

Question 9

Assignment of a note from a this person may satisfy a debt

Answer 9

Birdsall

Question 10

If the parties voluntarily agree to a modification that is fair and equitable in view of circumstances not originally anticipated by the parties it is enforceable

Answer 10

Angel, RST 2d § 89

Question 11

If the parties voluntarily agree to a modification, it is enforceable

Answer 11

UCC § 2-209

Question 12

A promise which should reasonably be expected to induce reliance and which is relied upon may be enforceable (if non-enforcment would be unjust). Remedy may be limited as justice requires.

Answer 12

RST 2d § 90

Question 13

Promise which should reasonably be expected to induce reliance of a definite and substantial charter and which is relied upon may be enforceable (if non-enforcment would be unjust)

Answer 13

RST 1st § 90

Question 14

Promise which should reasonably be expected to induce reliance of a definite and substantial charter and which is relied upon may be enforceable (if non-enforcment would be unjust)

Answer 14

RST 2d § 90

Question 15

Where a condition is merely necessary to the giving of a gift, it is considered a condition for a gratuitous promise, and not consideration

Answer 15

Tomczak

Question 16

Forbearance from asserting legal claims is consideration so long as those claims were asserted in good faith (even if invalid)

Answer 16

Dyer, RST 2d § 74 - Forebearance of Claims

Question 17

Nominal consideration may be insufficient to support a promise

Answer 17

Schnell - Nominal Consideration

Question 18

Generally, Performance of a preexisting duty is not a valid consideration

Answer 18

RST 2d § 73 - Pre-existing duty rule

Question 19

Assignment of a note from a this person may satisfy a debt

Answer 19

Birdsall - Contract Modification

Question 20

If the parties voluntarily agree to a modification that is fair and equitable in view of circumstances not originally anticipated by the parties it is enforceable

Answer 20

Angel, RST 2d § 89 - Contract Modification

Question 21

A promise which should reasonably be expected to induce reliance and which is relied upon may be enforceable (if non-enforcment would be unjust). Remedy may be limited as justice requires.

Answer 21

RST 2d § 90 - Promissory Estoppel

Question 22

Promise which should reasonably be expected to induce reliance of a definite and substantial charter and which is relied upon may be enforceable (if non-enforcment would be unjust)

Answer 22

RST § 90 (old rule) - Promissory Estoppel

Question 23

Charitable subscriptions or a marriage settlement are still binding under promissory estoppel

Answer 23

RST 2d § 90 - Promissory Estoppel

Question 24

Promisory estoppel may be a basis for enforcing a promise if the standard laid out by RST 2d § 90 is met AND the promisor INTENDED to induce reliance

Answer 24

Conrad - Promissory Estoppel

Question 25

Past Material benefit to promisor may create a moral obligation that is binding as consideration

Answer 25

Webb - Material Benefit Rule (Promissory Restitution)

Question 26

Promise made in recognition of past material benefit is binding to “extent necessary to prevent injustice”

Answer 26

RST 2d § 86 - Material Benefit Rule

Question 27

In certain circumstances, restitutionary damages may be awarded even when there is no promise, user principles of quasi-contract

Answer 27

Restitution (Unjust Enrichment)

Question 28

Preliminary agreements may be enforceable, even if parties anticipated the execution of a formal agreement, if the parties intended them to be binding. If an alleged contract is ambiguous, the parties’ intent to be bound is a question of fact.

Answer 28

Quake Construction

Question 29

A contract may be enforced even though some terms are missing or left to be agreed upon, but if the essential terms are so uncertain that there is no basis for determining breach, there is no contract.

Answer 29

Academy of Chicago Publishing

Question 30

If the parties intended a contract, the court is obligated to fill gaps, if it is reasonably able to do so. Courts should not void an agreement for lack of essential terms except as a last resort.

Answer 30

B. Lewis Productions

Question 31

The terms of a contract must be reasonably certain - they must provide a basis for determining the existence of a breach and for giving an appropriate remedy

Answer 31

RST 2d § 33

Question 32

A contract does not fail for indefiniteness if the parties have intended to make a contract and there is a reasonably certain basis for giving an appropriate remedy.

Answer 32

UCC §2-204

Question 33

Duty of good faith and fair dealing is implied in all contracts, and may be used to help interpret terms

Answer 33

B. Lewis Productions

Question 34

Every contract imposes upon each party a duty of good faith and fair dealing in its performance and its enforcement

Answer 34

RST 2d § 205

Question 35

Exclusive dealings agreement imposes a mutual obligation to use best efforts

Answer 35

UCC 2-306

Question 36

In determining whether an offer is made, we look to the objective reasonableness of the alleged offeree’s belief that there was an offer, or whether is was “evidently in jest.”

Answer 36

Lucy v Zehmer, Leonard v. Pepsico

Question 37

Advertisements are not offers, but merely invitations for an offer of sale on the terms stated

Answer 37

Lefkowitz

Question 38

Where the advertisement is clear, definite, and explicit, and leaves nothing open for negotiation, it constitutes an offer

Answer 38

Lefkowitz

Question 39

Advertisements offering rewards for the performance of a specific action may be construed as offers to anyone who is induced to perform that action

Answer 39

Leonard v Pepsico (Carbolic Smoke Balls)

Question 40

A reply to an offer which purports to accept it but is conditional on the offeror’s assent to terms additional to or different from those offered is not an acceptance but is a counter-offer

Answer 40

RST 2d § 59 (Mirror Image Rule)

Question 41

An acceptance which requests a change or addition to the terms of the offer is not invalidated unless the acceptance is made to depend on an assent to the changed or added terms

Answer 41

RST 2d § 61 (Mirror Image Rule)

Question 42

Acceptance of a bilateral (return promise) contract takes effect when manifestation of assent is SENT

Answer 42

RST 2d § 63(a) - Mailbox Rule

Question 43

Acceptance of an Option Contract takes effect when manifestation of assent is RECIEVED

Answer 43

RST 2d § 63 (b)

Question 44

The power of acceptance is terminated when the offer RECIEVES from the offer a manifestation of an intention not to enter into the proposed contract.

Answer 44

RST 2d § 42 - Revocation

Question 45

For a Bilateral Contract, acceptance takes effect when performance is BEGUN

Answer 45

RST 2d § 62

Question 46

For a Unilateral Contract, acceptance takes effect when performance is COMPLETED

Answer 46

RST 2d § 50

Question 47

Where an offer invites an offer to accept by rendering a performance, no notification is necessary to make such an acceptance effective unless the offereror requests such a notification

Answer 47

RST 2d § 54

Question 48

If an offer who accepts by rendering a performance has reason to know that the offeror has no adequate means of learning of the performance with reasonable promptness and certainty, the contractual duty of the offeror is discharged unless

 (a) the offer exercises erasable diligence to notify the offeror of acceptance, or
 (b) the offeror learns of the performance within a reasonable time, or
 (c) the offer indicates that notification of acceptance is not required

Answer 48

RST 2d § 54

Question 49

Generally, silence or inaction does not serve as valid acceptance, except:

(a) where the offeree takes the benefit with reasonable opportunity to reject and reason to know that they were offered with the expectation of compensation
(b) Where the offeror has stated or given offeree reason to believe that acceptance could be made through silence or inaction and the offer intends to accept the offer
 (c) Where because of previous dealings or other it is reasonable that the offer should notify the offeror if he DOES NOT intend to accept

Answer 49

Houston Dairy, RST 2d. § 69

Question 50

An offered who does any act inconsistent with the offer or ownership of offered property is bound in accordance with the offered terms unless they are manifestly unreasonable. Offeror has option to ratify the acceptance.

Answer 50

RST 2d § 69

Question 51

An offered cannot actually assent to an offer unless he knows of its existence

Answer 51

Specht v Netscape

Question 52

A valid acceptance requires reasonable notice of the existence of contract terms and unambiguous assent to those terms by the offeree

Answer 52

Douglas v Talk America