08 Week Contracts Slides

# PCL 1L Contracts    [@peoplescollolaw](https://twitter.com/peoplescollolaw) --- # Part I ## Review **Consideration** The bargained-for exchange that imposes a legal detriment on the promisee. Typically in a bilateral contract, both parties are induced by a promise to incur a detriment. --- Easiest way to answer on an essay is to spell everything out in your analysis: Party X promised to pay money, a detriment, in exchange for painting, a benefit. Party Y promised to paint, a detriment, for money, a benefit. Therefore, there's valid consideration. --- ## PMG **Gifts** Generally gifts are not valid consideration. - acts or forbearance - elements of gift - need not be economic --- ## Past or Moral Generally neither are sufficient - debt exception (revived debt) - past benefit issue (some courts) --- ## Legal Value - adequacy - token - sham (remember it means it wasn't tendered or intended to be tendered) - possibility of value - potential claim is a favorite to test --- ## Detriment and Benefit Act when under no legal obligation or forbearance when there's a legal right. --- ## **Preexisting Legal Duty** Where a party has an existing legal duty, a promise to perform or the performance of that duty is ***not consideration***. ### Exceptions - New or different (Modification) - Voidable (elective) obligation - Third party (majority view) - Honest dispute (compromise) --- ### Exceptions Continued - Unforeseen Circumstances (Impracticality Discharge) - UCC Modification - Existing debts - undisputed v. disputed - Forbearance to sue --- ## Modification An agreement between the parties to modify the terms of an existing contract. At common law modification requires **new** consideration. The UCC only requires good faith. --- # Part II ## Mutuality There must be a binding promise by both parties --- ## Requirements and Output revisited The consideration is the forgoing the right to buy or sell from another party. --- ### Issues - Conditional promises - conditioned on satisfaction - Right to Cancel or Withdraw - Exclusivity --- ### Issues Continued - Voidable Promises - Suretyship - before or concurrent to promise or performance - after promise or performance - alternate courses --- ## Promissory Estoppel *Detrimental Reliance* Prevents a party from arguing the existence of a valid contract, where: 1) promisor makes representations inducing reliance; 2) promisee actually and reasonably relies on the representation to their detriment; 3) injustice would otherwise result if not enforced. --- ## Promissory Estoppel Is considered a substitute for consideration Typically the party in reliance hasn't promised any consideration --- [June 2015 Q2](http://www.calbar.ca.gov/Portals/0/documents/admissions/fyx/June2015_FYSelectedAnswers.pdf) ###### http://www.calbar.ca.gov/Portals/0/documents/admissions/fyx/June2015_FYSelectedAnswers.pdf --- # Part III General formation issues --- ### Our cases this week *Wiseco, Inc. v. Johnson Controls, Inc.* (222) *Feinberg v. Pfeiffer Co* (243) *Conrad v. Fields* (247) --- :scales: :mortar_board: [@peoplescollolaw](https://twitter.com/peoplescollolaw) :mortar_board: :scales: ---