Exam 12: Consideration

Jason's mother would like him to go to college, so in June he enrolls at the local university. He also quits his job and tells his mother his plans to take classes. His mother says, "I'm so happy that you are going to college that I want to pay for your books." Jason then sends her a bill for $485. Jason's mother's promise is:

Herb promises to give his nephew, Curt, his old TV when the new one he ordered arrives. Explain whether this promise is enforceable, and include in your discussion the concept of "bargained-for exchange."

Exclusive dealing contracts are illegal and therefore always void.

A bank robbery has occurred, and the banker's association has offered a $1,000 reward for information leading to the arrest and conviction of the robber. Several people are claiming to be entitled to the money. Which of them is eligible?

Under the common law, in order to be enforceable, a modification of an existing contract must be supported by mutual consideration.

A promisee's consideration is effective only if given directly to the promisor by the promisee.

Clint contests the amount of a bill he received from Car Care Specialists. Under the Restatement, settlement of the claim:

William agrees to drill a well up to 200-feet deep for John's rural cabin. The contract price is $3,000. After drilling 100 feet, William strikes solid granite rock. He talks to John and explains that this is highly unusual for the area and could not have been anticipated at the time of entering into the contract. He offers to get a special drill, but says it will cost him more money, so that he will be unable to complete the project for the agreed price. Because John is anxious to have the well, he agrees to pay William an additional $1,000 to complete the job. However, once the well is finished, he changes his mind and now says he will pay only the originally agreed-upon amount. What is the result?

Exclusive dealing contracts are binding because sufficient consideration is present.

Which of the following is not correct with regard to consideration?

Define legal detriment.

Alice says to Brian, "If I decide to buy a digital camera next year, I will buy it from you." This is an example of:

Which of the following would not be a promise statutorily made enforceable without consideration?

If Marguarite promises to pay Neal $300 not to defame her, the promise is unenforceable because tort law imposes a preexisting obligation on Neal to refrain from such an act.

James promises to pay Brooke $2,500 if she does not sue him for negligently injuring her in a bicycle accident. If Brooke does not sue, James's promise to pay is binding because it is supported by consideration.

The performance of a pre-existing contractual duty which is neither doubtful nor the subject of an honest dispute is legally sufficient consideration to support a second contract.

"Consideration" requires an actual benefit to both sides of an agreement.

Legal detriment means the obtaining by the promisor of that which he had no prior legal right to obtain.

Marilyn contracted with Bravo Builders to build an addition to her house for $15,000. After digging the foundation, Bravo decides that it will take more work and more concrete than it had originally thought and that it will need to charge an additional $5,000 for the job. Assuming Marilyn agrees, which of the following is correct?

An output contract is a special form of an illusory contract.