What a person receives in return for performing a contract obligation.

Types of consideration (4):

1. A (benefit) to the promise 2. A (detriment) to the promisor Ex: Punch the promisor in the face 3. (A promise to do) something Ex: Face to face promise 4. A promise to refrain from doing something Ex: Promise to not punch the promisor in the face.

Adequacy of consideration

The court doesn't help you if you made a bad deal (paid $500 for a $100 TV).

Exception to Adequacy of consideration

if the court believes fraud or undue influence occurred, the court may look at adequacy of consideration.

. Is not a promise at all ii. This promise is not consideration Ex: Shawn offers to sell Molly his skis for $300, and Molly responds "I'll look at them in the morning, and if I like them, I'll pay you."

Enforcement of Promise

For a court to (enforce) a promise, both parties must provide valid consideration, consideration by one party only is insufficient to support this:

Preexisting Duty Rule

i. Performance of a duty you are (obligated) to do under the law is not consideration. ii. Performance of an existing contractual duty is not good consideration.

Types of Partial Payment of a Debt (2):

i. Liquidated debt ii. Unliquidated debt

(No dispute that money is owed or how much) - debtor must pay the full amount even if agree to lesser sum.

The parties either (disagree about whether money is owed or dispute the amount) - the parties can settle for less than the full amount if they (enter into an accord and satisfaction.)

Accord & Satisfaction (used for Unliquidated debt)

Settling to pay an unliquidated debt for less than the full amount (requires 3 things).

3 Requirements for Accord & Satisfaction:

1. The debt is unliquidated 2. The creditor agrees to accept less than it is owed as full payment. 3. The debtor pays the amount they have agreed on

new agreement to pay less than creditor claims is owed

debtor's payment of a reduced amount

failure to pay under accord and satisfaction

creditor can sue for full amount of original debt

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BUL 4421 FINAL

Question	Answer
CHAPTER 15: Consideration	CHAPTER 15: Consideration
Consideration	What a person receives in return for performing a contract obligation.
Types of consideration (4):	1. A (benefit) to the promise 2. A (detriment) to the promisor Ex: Punch the promisor in the face 3. (A promise to do) something Ex: Face to face promise 4. A promise to refrain from doing something Ex: Promise to not punch the promisor in the face.
Adequacy of consideration	The court doesn't help you if you made a bad deal (paid $500 for a $100 TV).
Exception to Adequacy of consideration	if the court believes fraud or undue influence occurred, the court may look at adequacy of consideration.
Illusory Promise	. Is not a promise at all ii. This promise is not consideration Ex: Shawn offers to sell Molly his skis for $300, and Molly responds "I'll look at them in the morning, and if I like them, I'll pay you."
Enforcement of Promise	For a court to (enforce) a promise, both parties must provide valid consideration, consideration by one party only is insufficient to support this:
Preexisting Duty Rule	i. Performance of a duty you are (obligated) to do under the law is not consideration. ii. Performance of an existing contractual duty is not good consideration.
Types of Partial Payment of a Debt (2):	i. Liquidated debt ii. Unliquidated debt
Liquidated debt	(No dispute that money is owed or how much) - debtor must pay the full amount even if agree to lesser sum.
Unliquidated debt	The parties either (disagree about whether money is owed or dispute the amount) - the parties can settle for less than the full amount if they (enter into an accord and satisfaction.)
Accord & Satisfaction (used for Unliquidated debt)	Settling to pay an unliquidated debt for less than the full amount (requires 3 things).
3 Requirements for Accord & Satisfaction:	1. The debt is unliquidated 2. The creditor agrees to accept less than it is owed as full payment. 3. The debtor pays the amount they have agreed on
"accord"	new agreement to pay less than creditor claims is owed
"satisfaction" =	debtor's payment of a reduced amount
under accord and satisfaction, the debt is	fully discharged
failure to pay under accord and satisfaction	creditor can sue for full amount of original debt

Created by: user-1984436

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