LESSON 9-2 Quiz Review

Illusory Promises “Open ended” promises “Either” party can back out “No consideration” when created Illusory Promises

Do illusory promises have consideration? No Consideration is needed once the promise becomes agreed to Detriment taken on Do illusory promises have consideration?

Termination contract “1” sided illusory promise Only 1 side can end the agreement at any time Used to get a new product sold Termination contract

Taking on a responsibility that you would NOT have taken on unless a promise was made Binds a promise DETRIMENT

consideration Must be “Fair” not equal Present in ALL binding agreements consideration

release Takes place once contract ends Obligations and duties end for both parties Cannot sue because contract HAS been performed Contract not cancelled, it ends release

Agreeing to purchase a companies TOTAL output or production McDonalds- French fries Output contract

requirements contract Agreeing to sell my product only to chosen companies Microsoft requirements contract

When a party negotiates something they are already supposed to do Existing duty

Existing Public Duty means something is against the law and cannot be used as consideration Existing Private Duty means something is already in the contract and cannot be used as consideration Public vs. Private

When a party enters a contract, they must complete what they agree to Ex) If I agree to mow your lawn for $40, I am under obligation Obligation

Similar to obligation, as a duty is what I must do as per the agreement Ex) If I borrow $1000 and agree to pay $100 a month, my duty is what I agree Duty

Liquidated debt Parties “agree” a debt exists and to its amount Ex) I get my car loan bill in mail and decide the amount being asked for payment is correct Liquidated debt

Un-Liquidated debt Parties “Disagree” a debt exists and to its amount Ex) I get my electric bill and know I owe something, but not the amount being asked for Un-Liquidated debt

Accord and satisfaction Agreeing to accept less than the full amount owed in exchange to cancel the rest of the debt Promise NOT to sue Accord and satisfaction

Questions?