Exam 12: Consideration

EcoEnergy LLC files a suit against Fiber Optics Inc., claiming that the consideration for their contract is inadequate-that the plaintiff will not realize sufficient financial benefit from the deal to make it worthwhile. Most likely, the court will

Greta files a suit against Home Repair Corporation under the doctrine of promissory estoppel. Greta must show that

Consideration refers to the serious thought that underlies a party's intent to enter into a contract.

Dean, the president of Billing & Credit Company, promises to pay his employee Ewing, who is dangerously obese, $10 for every pound that he loses within the next two years. Ewing agrees, diets and exercises, loses 154 pounds, and asks Dean for $1,540. Dean refuses to pay, saying that he does not remember the promise, but that even if he did make it, there was no consideration, and Ewing's improved health is a sufficient benefit for his effort and sacrifice. Ewing files a suit against Dean. In whose favor is the court likely to rule, and why?

Shockingly inadequate consideration can indicate fraud in a contract.

Rory questions whether there is consideration for his contract with Silver Spurs Club to exchange his performance of country music on certain dates for Silver's payment of a certain amount. To constitute consideration, the value of whatever is exchanged must be

If a party is already bound by contract to perform a certain duty, that duty can serve as consideration for a second contract.

To enforce a contractual promise, there must be an exchange of consideration underlying the bargain.

Exceptions to the preexisting duty rule include rescission.

Rex contracts with Spicy Pizza to deliver its products. After the deal has been partially performed, both parties inform each other that they would like to cancel the contract. Rex and Spicy may rescind

Kim promises to pay Leo $500 to install a sump pump in Kim's warehouse. Leo completes the installation. The act of installing the pump

Bistro Caterers contracts with Corporate Towers to cater the firm's business meetings. Later, the contract between Bistro and Corporate is completely rescinded. Even later, Bistro offers to make a new deal. Corporate is willing to deal, but for a new price. Bistro and Corporate