Chapter 10 - agreement but on completion of the work...

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Question 6 Under a contract between E. S. Herrick Co. and Maine Wild Blueberry Co. the price was left unliquidated (was in dispute). An unliquidated debt is a debt that is not settled, fixed or agreed. Maine Wild Blueberry Co. sent a check to E. S. Herrick Co. with a letter that stated the check was the “final statement”. E. S. Herrick Co. cashed the check. An acceptance of a payment of a lesser sum operates as satisfaction, or discharge of the debt. The court most likely will not satisfy the E. S. Herrick Co. claim for any additional money against the Maine Wild Blueberry Co. because the check was accepted. In a situation that involves an unliquidated debt, acceptance means agreement. Question 8 Preexisting duty cannot serve as a consideration for a modification of a contract without exceptional circumstances. In our case the exceptional circumstances did occur. Empire signed a modification of the original
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Unformatted text preview: agreement but on completion of the work refused to pay. When Rock Services filed a suit against Empire, Empire claimed that the modification lacked consideration and thus was not valid and enforceable. Parties may effectively modify a contract by rescinding a contract, and as a result set up a new contract. Sometimes rescission and the making of new contract remain the same duty for both parties as in their original contracts. In those situations, the courts frequently are giving a choice of applying the preexisting duty rule or allowing rescission and letting the new contract stand. In this case there was an unforeseen difficulty such as heavy concentration of water. Because the unforeseen difficulty did occur the court may retrain from applying preexisting duty rule, even though the courts usually assert the preexisting duty rule....
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This note was uploaded on 03/11/2011 for the course ACC 101 taught by Professor Corolinsky during the Spring '11 term at SUNY Albany.

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