Consideration Substitutes

Question 1

Promissory Estoppel

Answer 1

The doctrine of promissory estoppel can be used to enforce a promise that is not supported by consideration. The promise is binding if:

1. a promise is made that can reasonably be expected to induce reliance,
2. the promisee takes detrimental action in reliance on the promise, AND
3. injustice can only be avoided by enforcement of the promise.

Note: charities do not need to prove detrimental reliance.

Question 2

Quasi-K

Answer 2

When one party confers a benefit on another party, but there was not an opportunity to make a K, the conferring party can recover under the quasi-K theory. Recovery is possible if:

1. the π confers a measurable benefit on the ∆
2. the π reasonably expected to get paid, AND
3. it would be unfair to let the ∆ keep the benefit without paying.

Damages on this theory usually limited to FMV of benefit.
Apply theory if no K exists but would still be unfair for no payment.

Question 3

Moral Obligation + Subsequent Promise Theory

Answer 3

In a few JXs, a moral obligation followed by a promises to pay can be binding. Ordinarily, this would be past consideration and thus not binding.

Question 4

Are seals consideration?

Answer 4

No, not in most JXs.