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Contract Law (Consideration :smiley:
Benefit given by the promisee in…
Contract Law
Consideration :smiley:
- Benefit given by the promisee in exchange for the promise
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Rules :warning:
1. Has to have some value
- Capable of monetary value
2. Must be fresh
- Something the promisor was not originally entitled to receive
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Scenarios
1. D&C Builder vs. Rees
- A lends $482 to B
- A promises that B only needs to pay $300
- B paid $300
- However, A sues B
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2. Williams vs. Roffey
- Main contractor (A) is responsible of a project given by Developer
- A pays $20,000 to Sub-contractor (B) to do carpenting work
- B faces financial problem and need time extension
- A promises B to pay bonus if B completes the project on time
- B completed the carpenting work of the project on time
- A refuses to pay the bonus A avoids penalty from Developer
3. Driving Lessons Promisory Estoppel
- A teaches driving with a rate of $45
- B would like to cancel as he has financial trouble
- A promises B that he only needs to pay $15
- B agrees and takes the driving lessons, pays $15
- A sues B
Yes, there is PE because:
- There were promise made by A to B
- B relied on the promise because he took the lesson
- B suffered detriment because he paid $15
Court held that completing existing obligation + avoiding a penalty/disbenefit is a Fresh Consideration
:pencil2:Intention to create legal relations
- Intention of parties to be bound to a binding contract
If an agreement is made in a domestic OR social context
- It is presumed that parties do not intend to create legal relation
Note: Unless there is an MOU (Memorandum of Understanding)
If an agreement is made in a business OR commercial context
- It is presumed that parties do intend to create legal relations
:pen:Agreement
Offer
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Rules :warning:
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3. Termination
a) Withdrawal
- Communicate to all parties - before acceptance
b) Rejection
- Offer automatically terminated
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d) Death of Offeror
- Personal service
- Does not involve personal service, but offeree knew of death of offeror
Acceptance
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Rules :warning:
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2. If method of acceptance is specified, acceptance can only be made in method specified
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4. Acceptance requires a positive act
- verbal, writing, conduct
- silence is insufficient