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Unformatted text preview: BLS Exam 3 Chapters 15-19 23:57 Chapter 15 Consideration – requirement of ever contract; what a person will receive in return for performing a contract obligation. Can be anything as long as it is a product of a “bargained for exchange” Benefit to the promisor Detriment to the promisee Promise to do or not to do something Sufficiency of Consideration: Rules of Consideration Lack of consideration – for a promise to be enforced, consideration must exist Promissor estoppel is an exception Adequacy of consideration An illusory promise is not consideration. Ex: Sean offers to sell Sara skis. Sara responds, “ill look at them in the morning and if I like them ill pa you”. Past consideration is not consideration Preexisting duty – Ex: Gene is having a pool built with a completion date of June 1. Then the contractor sas we will only finish b the date if you pa an extra $5,000. The pool is finished b June 1 and so Gene does not owe him the money. Unforeseen circumstances – if additional consideration is needed; Pool EX contd. – in this case the need more time and money because the hit solid rock that needs to be taken care of. (“Rock Clause”) Additional work – halfway through the building process Gene says she wants a waterfall so she agrees to pa extra money for the addition of the waterfall UCC – sale of goods – an agreement modifying a contract needs no consideration to be binding. Ex- you place an order and then you decide you want a different color TEST EXAMPLE -- For 20,000, a guy will build a room addition. Guy goes back to lady and says, this requires more labor than I thought. He says he needs an extra 5,000. HE tries to collect…does she have to pay?? No, because he has a pre-existing duty to build the addition anyway. No NEW CONSIDERATION Substituted Contract A promises to pay 5.00, B promises to cut grass neither wants to do it anymore Second contract: Both promise to not perform first contract, instead…A promises to pay 10.00 for B’s promise to wash car. SUBSTITUTED CONTRACT Universal Commercial Code: Requirement and Output Contracts A requirement contract is an agreement whereby the buyer agrees to purchase all his goods from one seller. No quantity is stated in the contract. An output contract is an agreement whereby the seller guarantees to sell everything she products to one buyer. No quantity is stated in the contract....
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- Fall '08