Chapter 12 - Consideration

Chapter 12 - Consideration - Law & Society I M W 9:30AM,...

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Law & Society I Key : M W 9:30AM, Snell 213 Normal, dark blue, size 12 font: Every header found in text John Exley, ID: 0160294 Normal, black, size 12 font: Excerpts from text 10.03.08 Bold, black, size 12 font: Vocabulary from text Chapter 12: Consideration Pages 250-261 Consideration: Generally, the value given in return for a promise or a performance. The consideration, which must be present to make the contract legally binding, must be something of legally sufficient value and bargained for. Section 1 – Elements of Consideration Broken into 2 parts: 1) Something of legally sufficient value must be given in exchange for the promise. 2) There must be a bargained-for exchange (usually). Legal Value “Something of legally sufficient value” may consist of: 1) A promise to do something that one has no prior legal duty to do 2) The performance of an action that one is otherwise not obligated to undertake 3) Forbearance 4) Something of new value; something you didn’t have to give before; something you aren’t normally entitled to; benefit or detriment; new obligation you never had before. Forbearance: The act of refraining from an action that one has a legal right to undertake. Bargained-for Exchange The promise given by the promisor (offeror) must induce the promisee (offeree) to offer a return promise, a performance, or a forbearance, and the promisee’s promise, performance, or forbearance must induce the promisor to make the promise. . .This element of bargained-for exchange distinguishes contracts from gifts. Section 2 – Adequacy of Consideration …concerns the fairness of the bargain. Courts Typically Will Not Consider Adequacy A court will not (usually) question the adequacy of consideration based solely on the comparative value if the things exchanged. In other words, the determination of whether consideration exists does not depend on a comparison of the value of the things exchanged. Evidence of Grossly Inadequate Consideration When there’s a gross disparity in the amount or value of the consideration exchanged, the inadequate consideration may raise a red flag for a court to look more closely at the bargain because shockingly inadequate consideration can indicate that fraud, duress, or undue influence
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This note was uploaded on 09/15/2009 for the course LW 270 taught by Professor Wears during the Spring '09 term at Clarkson University .

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Chapter 12 - Consideration - Law & Society I M W 9:30AM,...

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