Consideration Requirements
Contract is enforceable only if the contracting parties have:
1. exchanged something of value
2. Value is broadly-defined
3. Value may consist of a profit, a benefit or a right
4. Value may consist of incurring a loss or a detriment, or may involve the waiver or forbearance of a right
Characteristics of Consideration
- does not have to be equal
- Past performance does not equal consideration
- Pre-existing duty to perform does not equal consideration
- Moral/ethical considerations do not equal consideration
- CISG/UNIDROIT (not on bar exam)
Key Promissory Estoppel Points
Promissory estoppel asks a court to order the offeror to keep the offeror’s promise, in order to prevent injustice to the offeree. It is a justice-based argument. It does not require proving the elements of a valid contract.
Elements of Promissory Estoppel
- Promisor makes a promise
- Which the Promisor should reasonably expect to induce reliance by the offeree
- Which does induce definite, substantial reliance by the offeree
- The Offer is binding if necessary to prevent injustice (court orders)
- Offeree has the burden of proof to prove injustice
Elements of Quasi-Contract
- Applies when a benefit is conferred (given) upon the offeree by the offeror (typically a service is provided by the offeror) (service is performed)
- The offeree had knowledge of the benefit (service)
- The offeree retains (keeps) the benefit (service)
- If it is necessary to prevent injustice to the offeror, courts will order the offeree to perform, by paying the offeror the reasonable value of the service (the benefit)
Elements of Promissory Restitution
- A promise by the promisor
- Made in recognition of a benefit previously received by the promisor (promise that was already made)
- The benefit was received from the promisee (not a third party)
When is a promise is not binding?
Is a gift
The value of the promise is disproportionate to the benefit
the promisor has not been unjustly enriched by the benefit
What does promissory estoppel do?
Promissory estoppel is designed to protect the offeree when the offeror refuses to keep a promise made to the offeree
Does promissory estoppel require proving the elements of a valid contract?
No. It is a justice-based argument. (how does this work?
what is a quasi-contract?
when the offeree retains (keeps) a benefit conferred by the offeror but refuses to pay for the benefit. The benefit is usually a service performed by the offeror.
??
A promise made in recognition of a benefit previously received by the promisor from the promise is binding to the extent necessary to prevent injustice to the promisee.
