Page 13 Flashcards
If a creditor agrees to less than the payment required plus the debtor promises not to file bankruptcy, is that enforceable?
Yes, because the debtor has forgone his legal right to file bankruptcy, which is consideration
If a creditor gives a written release for a debt, what does that do?
Releases the obligation
What is an executory contract?
One involving ongoing periodic payments
If a debtor gives a check in full payment that is less than agreed, what are the different viewpoints on this?
- CL: cashing the check is an accord/satisfaction that discharges the entire debt if there was a good faith dispute about the amount and the creditor had reasonable notice that it was full payment.
- UCC: if cashed, entire claim is discharged if the check was tendered in good faith with an accompanying conspicuous statement that it was in full satisfaction, and the amount is unliquidated or subject to a bonafide dispute
What are exceptions to cashing a check that claims to be full payment but isn’t?
It doesn’t discharge the debt if:
- creditor is an ORGANIZATION
- before check was tendered, creditor sent a statement that payment must be sent to specific place/person and it wasn’t sent there
- if creditor DOESN’T KNOW check is tendered in full satisfaction
- creditor sends check back within 90 days of payment
Agreeing to pay more for the same performance is usually not enforceable because why?
No consideration
What are the exceptions to agreeing to pay more for the same performance not being consideration?
- promise is similar but different
- the pre-existing duty was owed to someone other then the person that the new promise is made to
- unanticipated circumstances
If there is an agreement to build a house for $200,000 with pine doors, then it is modified to pay $230,000 with red wood doors, is that OK?
Yes, because the promise is similar but different, so there is consideration (diff doors) for more money
What is the best way to avoid illusory promises?
Insert a requirement of good faith or reasonableness into the agreement
What is an aleatory promise?
Conditional on the happening of a fortuitous event not within the promisor’s control
If you make a conditional promise to buy a house contingent on getting approval for a loan, what have you impliedly promised?
To use reasonable efforts to get the loan
If you promise to pay an old debt, what does that do to the statute of limitations?
Starts it anew
What kinds of contracts are voidable?
Those involving duress, mistake, fraud, infancy
If the interpretation of an expression involved in making a contract is at issue, what kind of interpretation should be given?
Objective - what a reasonable person in that person’s shoes, knowing all the addressee knows, would have interpreted it to mean
What is the peerless rule?
If an expression could have two equally reasonable meanings, and each person understands it differently, but equally reasonably, no contract is formed
