Consideration and Promissory Estopple (16%) Flashcards Preview

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Flashcards in Consideration and Promissory Estopple (16%) Deck (13):
1

the gratuitous promise is

a promise to make a gift ≠ consideration
Lacks consideration and is generally unenforceable

2

a promise is unenforceable unless

it supported by consideration

3

Distinguishing “Want of Consideration” from “Failure of Consideration”

a. “Want of Consideration”:
absence of a bargained for exchange
b. “Failure of consideration”:
a party’s failure to preform in accordance with promise (i.e. breach of contract)

4

Legal detriment test stipulates there is consideration when

1. Whether the promisee is doing something they had a legal right not to do or;

2. is foregoing some activity hat they have a legal right to engage in.

5

What is an illusory promise? Effect?

a promise to perform that leaves performance to the discretion to the promising party is illusory and does not constitute consideration

6

An executed gift is

1. intent to give a gift
2. actual or symbolic delivery of the gift

Legally binding

7

Can consideration be satisfied by just a recital?

No contract has been formed

8

Effect of placing a condition on a gratuitous promise?

Does not make it legally enforceable

9

Factors distinguishing a “Condition on a Gratuitous Promise” from “Consideration”
(3)

(a) Factor #1:
Language of the parties
1) Words suggesting benevolence rather than self interest may indicate a gratuitous promise

(b) Factor #2:
Context
1) In the commercial context, gratuitous promises are rare
Much more common in family context
(c) Factor #3:
Benefit to the Promisor
1) where the promisee’s detriment creates no benefit to promisor, more likely a gift than consideration

10

What is the past consideration rule?
-exceptions?

A promise in exchange for something already given or performed is not supported by consideration.

1. a written promise to pay a debt barred by statute of limitations
2. a written promise to pay a debt charged by bankruptcy

11

Promissory Estoppel: When can a promisee enforce a gratuitous promise?
(4)

1. There is a promise
2. Foreseeable reliance: must be foreseeable that the promisee will rely upon it
3. Actual reliance by promisee; and,
4. Injustice without enforcement

12

Injustice without enforcement factors for promissory estoppel
(5)

1) Strength of proof of the other three requirements

2) Blameworthiness of the breach

3) The relative position or equities of the parties

4) The extent to which the reliance was detrimental

5) The availability of alternatives, short of enforcing the promise

13

Promissory Estoppel is used when?

There is not a legally binding contract