Exam 12: Consideration

Mr.Green agrees to purchase a lawn mower from Ms.White for $300.The act of payment of $300 by Mr.Green is consideration for the act of passing ownership of the lawn mower from Ms.White to Mr.Green.

Consideration can be a promise for another promise.

According to the provisions of UCC,an exclusive dealing contract imposes a duty only on the distributor to use its best efforts to sell the goods.

Dan,President of BAZ Co. ,is happy with the extraordinary performance of Naomi,a BAZ Co.senior accountant.Dan informs Naomi that because of her superlative work in the past fiscal year,he is going to give her a 5 percent raise effective next month.Naomi,who has never heard of anyone at BAZ Co.getting a raise,is thrilled and thanks Dan.Later that day,Dan realizes that giving Naomi this raise might cause all senior accountants to demand salary increases.Dan decides not to give Naomi a raise after all.He believes that his promise to give her a raise is not legally binding.Dan is correct because:

Bill is 25 years old.His uncle promised in writing to pay him $2,000 if Bill would refrain from drinking alcohol for one year.Bill refrained from drinking alcohol for one year.However,his uncle now refuses to pay Bill as they agreed.The uncle claims that because Bill suffered no detriment by refraining from alcohol,his non-drinking does not constitute legal consideration,and,therefore,no contract was formed.If Bill sues his uncle,Bill will:

An accident on a state highway rendered Jill in a comatose state for nearly a month.There was an old nurse who used to take care of her then.After her recovery,Jill felt so indebted to the nurse that she contracted to transfer all her assets to her to fulfill her (Jill's)moral obligation.Although this contract lacks ________,it can be enforced.

Daniel owes Casey a debt,the amount of which is subject to a good faith dispute.The parties agree to settle the debt,with Daniel promising to pay Casey $15,000 and Casey promising to release Daniel on a $25,000 debt.The settlement agreement:

David,a debtor,owes debts to creditors Paul,Mark,and Gary.Paul,Mark,and Gary agree with each other and with David to release him from his debts,in exchange for his promise to pay Paul,Mark,and Gary 75 percent of the amount he owes each of them.This is called a composition agreement,and such agreements generally are binding contracts.

Ben,an accountant in Los Angeles,interviewed with Matt,a CPA in San Francisco.At the end of his interview,Matt,the personnel manager,told Ben: "I look forward to working with you.Please let me know if I can help you prepare for your move to San Francisco." Ben returned to Los Angeles,quit his job,gave a 30-day notice to his landlord,rented an apartment in San Francisco,and moved to San Francisco.Ben then called Matt to ask if he could start his job the following week.Matt replied that Ben had no job with him.Ben wants to recover the cost of moving expenses from Matt.Under what legal theory may he proceed? Discuss the arguments that Ben and Matt will each make if the claim is brought.

For the consideration requirement in contracts to be met: