Consideration and Contract Law Study Guide

Vocabulary flashcards covering key concepts, legal rules, and case doctrines from the Quiz 3 Study Guide on Consideration and Contract Law.

Consideration

"The price of the promise" or the thing used to induce another's promise or performance, which must be legally sufficient and present on both sides of a contract.

Bargain Model

The contract enforcement theory stating contracts should be enforced when parties agree to exchange one valuable thing for another through mutual inducement under R2dK sec 71.

Benefit-Detriment Theory

The doctrine established by Hamer v. Sidway requiring a benefit to the promisor or a legal detriment to the promisee as the price of the promise.

Legal Detriment

The forbearance or waiver of a legal right, or doing something one is not legally obligated to do.

Gratuitous Promise

A promise to make a gift that lacks consideration and is unenforceable, as held in Kirksey v. Kirksey and R2dK sec 71(b).

Illusory Promise

Words of promise that make performance entirely optional with the promisor, failing to constitute consideration under R2dK sec 77(a).

42 U.S.C. sec 1981

A provision of the Civil Rights Act of 1866 that prohibits intentional race discrimination in contract formation and enforcement.

Peppercorn Theory

The rule established in Batsakis v. Demotsis that courts generally will not inquire into the adequacy of value, meaning even minimal value can suffice as legal consideration.

Past Consideration

A past benefit that cannot constitute consideration for a new promise because it was not induced by or bargained for in exchange for that new promise.

Moral Obligation

A promise made based on a moral duty rather than a legal obligation, which generally does not count as valid consideration.

Nominal Consideration

A "sham" or "mere pretense" of a bargain, such as a false recital of consideration or consideration that exists in name only.

Promissory Estoppel

An equitable doctrine under R2dK sec 90(1) allowing recovery on a clear, definite promise that reasonably induces detrimental reliance, where injustice can only be avoided by enforcement.

Unjust Enrichment

A quasi-contract theory that permits courts to disgorge a defendant of a benefit unfairly received from the plaintiff and return its value to the plaintiff.

Quantum Meruit

A measure of recovery in quasi-contracts equal to the reasonable value of work or services actually performed, used to prevent unjust enrichment.

Implied in Law Contract

A legal fiction created to prevent unjust enrichment where there is no actual assent or contract, but a benefit was received and retained.

Implied in Fact Contract

A contract inferred from conduct where all essential elements of a contract are present, distinguished from a contract implied in law.

Officiousness

Unnecessary or unwanted behavior when conferring a benefit that prevents a party from claiming unjust enrichment.

TIRED

An acronym for the ways an offer can be terminated: Time lapse, Incapacity or death, Rejection, Expressly revoked, and Destruction of subject matter.

UOME

An acronym for situations where an offer is irrevocable: Unilateral contract, Option contract, Merchant firm offer (UCC 2-205), and Estoppel.

UCC 2-205 (USAW)

The Merchant's Firm Offer provision requiring a transaction under the UCC, Signed by a merchant, Assurance given, and in Writing.