HAMER v. SIDWAY International Business Law 14 May 2014

Slides:



Advertisements
Similar presentations
Chapter 11 Contracts — Consideration. Introduction Consideration is legal value given in return for a promise or performance. Must have something of legal.
Advertisements

Chapter 15 Consideration.
Consideration, Intention to Create Legal Relations, Capacity
Chapter 2 The Law of Contract
Agreement and Consideration in Contracts Chapter 7.
Chapter 14.1 Consideration. Consideration is either: some detriment to the promisee, that the promisee may give value; or some benefit to the promisor,
Intro to Consideration Contracts – Prof. Merges Jan. 13, 2011.
Practice Exam Fall 2008 Prof. Carol B. Swanson. For Your Test Today…  Review your Contracts texts: Summers/Hillman pp , Knapp/Crystal/Prince,
Izradio: Lucijan Loje Mentor: prof. dr. sc. Lelija Sočanac.
P A R T P A R T Contracts Introduction to Contracts The Agreement: Offer The Agreement: Acceptance Consideration Reality of Consent 3 McGraw-Hill/Irwin.
McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved.
Ag Business. A social agreement between 2 or more parties which sometimes may not be legal A legally binding agreement that is enforceable by law. Definition:
Contracts Mr. Dukes Business Education & Computer Science.
Civil litigation begins with pleadings: formal papers filed with the court by the plaintiff and defendant. Plaintiff - the person bringing the lawsuit.
Putting It All Together: Case Synthesis & Note-Taking Prof. Carol B. Swanson.
 Is an essential element of a valid contract. An agreement without consideration is a bare promise and is not binding on the parties.
P A R T P A R T Contracts Introduction to Contracts The Agreement: Offer The Agreement: Acceptance Consideration Reality of Consent 3 McGraw-Hill/Irwin.
Introduction to Contracts The Agreement: Offer The Agreement: Acceptance Consideration Reality of Consent © 2010 The McGraw-Hill Companies, Inc. All rights.
Nature and Terminology and Agreement in Traditional and E- Contracts Chapter 11 & 12.
Brown: Legal Terminology, 5 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved. Legal Terminology Fifth Edition by Gordon.
Understanding Business and Personal Law Consideration Section 8.1 Consideration Pre-Learning Question Why is consideration one of the six elements of a.
By Richard A. Mann & Barry S. Roberts
Chapter 10 Contracts—Agreement. 2 Introduction Agreement = offer and acceptance. Once an agreement is reached, if the other elements of a contract are.
A Bargain and an Exchange Consideration means that there must be bargaining that leads to an exchange between the parties. Consideration can be anything.
1 Chapter 5: The Court System. 2 Trial Courts Trial courts listen to testimony, consider evidence, and decide the facts in disputes. There are 2 parties.
Consideration Agreement Law
Putting It All Together: Case Synthesis & Note-Taking Fall 2010 Prof. Brenda L. Tofte* *Materials originally created by Prof. Carol Swanson.
Copyright © 2010 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. and the Legal Environment, 10 th edition by Richard.
LESSON 15 Contract. In law, a contract (or informally known as an agreement in some jurisdictions) is an agreement having a lawful object entered into.
Legal Capacity (Competency) 1. Section 10(1) of the Contract Act All agreements are contract if they are made by free consent of parties competent to.
December 17th, 1992 July 27 th, 1994 January 1993 Plaintiff entered into a contract. December 12, 1994 Defendants Fail to pay Plaintiff $150,000/year since.
Legislations.
Demystifying Class: Case Synthesis & Note-Taking Fall 2012
11-2 Capacity to Contract A competent party is a person who must meet all the following conditions: Must be of legal age. Must have normal mental capacity.
Prof. P. K. Kshirsagar BUSINESS LAW S.Y.B.Com..
3 Contracts Introduction to Contracts The Agreement: Offer
ESSENTIAL QUESTION Why does conflict develop?
Catamount Slate Products, Inc. V. Sheldon
Civics & Economics – Goals 5 & 6 Civil Cases
Chapter 12: Consideration
Chapter 11 Contracts: Consideration
Gastonia v. rogers GROUP 4
CHAPTER 12 Consideration
Contracts Lesson Two.
Civil Cases Chapter 16 Section 1.
Chapter 13: Contracts – Consideration
Chapter 12 Contracts: Consideration
Civil Trial Procedures
Performance of Contract
ESSENTIAL ELEMENTS OF A VALID CONTRACT (Sec.10)
Section 5.1 Capacity and Legality. Section 5.1 Capacity and Legality.
Chapter 12 Contracts: Consideration
Economics and the Real Estate Market & Contract Law
Section 5.2 Consideration.
Chapter 11 Consideration and Promissory Estoppel
Chapter 11 Consideration and Promissory Estoppel
1.04 Contracts.
BCOM 1ST YEAR - B 2ND SEMESTER MAITRI CHHABRA 2205 ARPITA 2347 CHHAYA 2355 SHUBHANGI.
Putting It All Together: Case Synthesis & Note-Taking Fall 2009
STRUCTURE OF THE PRESENTATION
Consideration - General
Chapter 12 Consideration
Agenda for 12th Class Admin Name plates Handouts Slides
More Contracts Consideration Pt. 1
Contracts What you should know.
Chapter 16.1 Civil Cases.
Mr. Stasa – W-E City Schools ©
Civil Law Procedures and Damages
Chapter 11 Consideration
Legally Binding Agreements
Presentation transcript:

HAMER v. SIDWAY International Business Law 14 May 2014 TANG, Cai Hong (Gwen) Y2012462149

Facts 20 Mar 1869 William E. Story Sr. promised his nephew, William E. Story Jr., $5,000* (‘offer’) if he refrains from drinking, using tobacco, swearing and playing cards or billiards for money until he reaches age 21 (conditions). William E. Story Jr. “assented” (‘acceptance’). William E. Story Jr. was 15 at this point in time. * $5,000 would be worth approximately $128,205 in 2013.

Facts (Cont’d) 31 Jan – 6 Feb 1875 William E. Story Jr. fulfilled the conditions and requested for his entitlement at age 21. Uncle William E. Story Sr. agreed, but stated that he would prefer to wait till William E. Story Jr. is older before handing over the (then) extremely large sum of money. And, interest would accrue on the withheld money. Again, William E. Story Jr. “consented”.

Facts (Cont’d) 1887 Uncle William E. Story Sr. unfortunately passed away before any payment. Hamer, as a representative, sought to claim the payment of $5,000 + interest from Sidway (the executor of Story Sr.’s estate). Sidway rejected the claim on the grounds that the contract was without consideration.

Plaintiff / Defendant Plaintiff: Hamer (representing William E. Story Jr.) Defendant: Sidway (executor of William E. Story Sr.’s estate) Trial Court  Court of Appeals  Supreme Court Verdict: In favor of Hamer. Sidway to pay. Sidway appealed. Appellate Court reversed; i.e. Sidway won. Hamer appealed. Verdict: ? Oct 1889 - 1891

Defendant’s Argument Sidway argued that: There was no consideration to support the contract  invalid. William E. Story Jr. had benefited by abstaining from alcohol and tobacco. It was in his best interests (healthy), independent of his uncle’s promise. Unless his uncle (the promisor) had benefited, the contract was without consideration. Oct 1889 - 1891

Issue The issue is whether William E. Story Jr.’s forbearance from his legal rights* (to fulfill the conditions set out by his uncle) constitutes a consideration to create a valid contract. * Drinking alcohol, smoking and gambling Oct 1889 - 1891

Rule The Exchequer Chamber in 1875 Definition of “Consideration”: “A valuable consideration, in the sense of the law, may consist either in some right, interest, profit, or benefit, accruing to the one party, or some forbearance, detriment, loss, or responsibility given, suffered, or undertaken by the other.” “Consideration means not so much that one party is profiting as the other abandons some legal right in the present, or limits his legal freedom of action in the future, as an inducement for the promise of the first.” Oct 1889 - 1891

Application of the Rule William E. Story Jr. smokes and occasionally drank alcohol and he had a legal right to do so. William E. Story Jr. had forgone his legal rights. This is sufficient consideration. In addition, it does not matter whether the performance of the conditions imposed proved a benefit to the promisor, Uncle William E. Story. Sr. or not. Hence, the contract is valid. Oct 1889 - 1891

Verdict Order appealed from reversed; and the judgment of the trial court was affirmed. Sidway to pay $5,000 + interest. Oct 1889 - 1891

Opinion/Discussion Legal right in modern times? - William E. Story Jr. was 15 at the time of contract - In modern U.S., legal drinking age is 21, legal smoking age is 18/19 (depending on states), legal gambling age is 18 and above (depending on states/activity). - Hence, no longer constitutes a consideration? Capacity of William E. Story Jr. to enter a contract? - In modern U.S., a minor (typically under 18) is considered incapable of entering a contract. - No contractual capacity = Invalid contract. Oct 1889 - 1891

Thank you.