Most contracts of commercial importance involve commitments on both sides, an exchange of promises. What kind of contracts are these?
bilateral
The person who makes a promise is known as the
promisor
The person to whom the promise is made is known as the
promise
A person who has made a will, especially a person who dies leaving a will, is known as
a testator
Michael lives next to an elderly couple. After a major snowstorm last winter, Michael thought he would surprise his neighbors and he shoveled their driveway without being asked to do so. When he was done with shoveling the driveway, Michael went home. The next day, Michael saw his neighbors at the grocery store. They said, “Michael, thank you very much for shoveling our driveway. We promise to pay you $50 when we get home. Please stop by for the money.” Later that day, Michael goes to his neighbors’ house and asks for the $50. The neighbors say, “I’m sorry. I was joking about the money. We are not going to pay you.” Which of the following is most accurate?
a. Michael’s act of shoveling the driveway serves as consideration for the neighbor’s promise to pay.
b. Because it is past behavior, Michael’s act of shoveling the driveway does not serve as consideration for the neighbor’s promise to pay.
A
Consider if the facts of Hamer v. Sidway were different. Imagine that the nephew decided on his own to refrain from drinking, smoking, and gambling until he reached 21, and he successfully did so. (Assume the nephew had the legal right to engage in these activities.) At the nephew’s twenty-first birthday party the Uncle said, “William, I am tremendously proud of you. I promise that tonight when I get home tonight I am going to write you a check for $5,000 in consideration of your accomplishment.” Unfortunately, the Uncle died in a car accident on the way home. Is the Uncle’s promise legally enforceable?
a. Yes. The nephew suffered a detriment when he avoided drinking, smoking, and gambling until he reached the age of 21, even though at the time it was legal for him to engage in all three activities.
B. No.
B
“Positive law” is
any law, whether enacted by a legislature or created by a court, that promotes, rather than undermines, the public welfare.
A “libelant” is the party who institutes a suit in admiralty by filing a “libel.”
T/F
True
The person who appeals a judgment to a higher court is known as the _________.
appellant
Unilateral contract
Consider if the facts of Hamer v. Sidway were different. Imagine that on the nephew’s sixteenth birthday the uncle said, “This is a happy day. In five short years, you will be an adult. Just as I gave you $5,000 to celebrate this birthday, I promise I will give you another $5,000 when you turn twenty-one.” On his twenty-first birthday, the nephew has a big birthday party, at which the uncle says, “Now that you are an adult, you have to look out for people who do not keep their promises. To teach you that lesson, I am not going to give you the gift of $5,000 I promised you five years ago. This lesson is worth much more than that.” What is the best way to interpret the situation?
a. This was a unilateral contract. By reaching the age of twenty-one, the nephew fulfilled his obligation and provided the necessary consideration to make the payment of $5,000 binding on the uncle. The uncle should get out his checkbook.
b. The part of the uncle’s statement five years ago that the nephew must reach the age of twenty-one simply identified the time at which the promise of the gift would be performed. The nephew reaching the age of twenty-one was not consideration; there was not a contract; and the uncle is not legally obligated to pay the $5,000.
B
Which is the best definition of “Executor?”
A person named by a testator to carry out the provisions in the testator’s will.
A mutual agreement between two parties where both parties agree to fulfill their side of the deal. In a ____ contract, each party is aware of their contractual obligations.
A bilateral contract
the act of refraining from enforcing a right, including the right to collect a debt.
“Forbearance
_____ is not considered a promise because it is too indefinite and cannot be enforced in court .
illusory promise.
Imagine the following situation. Buyer says: “I promise to buy your car on Saturday for $1,000.” Seller replies, “I promise to sell you my car on Saturday for $1,000, if I feel like it.” On Saturday, Buyer refuses to pay for the car. Seller sues Buyer for breach of contract. Was there a contract? Use four or five sentences, please explain you answer.
There was not a valid contract between the buyer and seller. In order for a contract to be valid there must be an offer, acceptance, and consideration that takes place. There was a lack of consideration . This is considered an illusory promise because it was an indefinite promise that would not be enforced in court. There was a lack of consideration
There are two parties involved in this situation, an insurance company and a policy holder. The policy holder promises to pay the premium price of $1,000. The insurance company promises to pay the policy holder $1,000 if the policy holder’s house is destroyed by fire within the next year. Is the insurance company obligated to pay if the house burns down in six months? Using four or five sentences, please explain your answer.
Yes the insurance company is obligated to pay if the house burns down in six months. This promise includes an offer, an acceptance , and has valid mutuality of consideration. There was a conditional promise made between the insurance company and the policy holder. A conditional promise is a promise subject to the occurrence of a specific event before the promisor is obligated to perform. Here the insurance company promises to pay $1000 in the case that a fire occurs and the house is destroyed which created a unilateral contract between the parties.. Due to the conditional promise the insurance company would have the legal obligation to pay for the policy holders damages.
“I promise to sell you my car, if I want to do so.” This is an example of
an illusory promise.
I leave the following note with the parent of the 19-year-old (old enough to enter into a contract) who lives next door: “If you mow my yard, I will pay you $50.” The teenager is away from home, running an errand. I go grocery shopping and run a few errands. When I return, the yard is mowed. Is there a contract? Do I owe $50?
Yes. Unilateral contract. – because there was only one task being performed
Michael lives next to an elderly couple. After a major snowstorm last winter, Michael thought he would surprise his neighbors and he shoveled their driveway without being asked to do so. When he was done with shoveling the driveway, Michael went home. The next day, Michael saw his neighbors at the grocery store. They said, “Michael, thank you very much for shoveling our driveway. We promise to pay you $50 when we get home. Please stop by for the money.” Later that day, Michael goes to his neighbors’ house and asks for the $50. The neighbors say, “I’m sorry. I was joking about the money. We are not going to pay you.” Which of the following is most accurate?
Because it is past behavior, Michael’s act of shoveling the driveway does not serve as consideration for the neighbor’s promise to pay.
Person A says, “If you give me your address, I will mail you a check for $200.” You write down your mailing address and hand it to Person A. Later that day, Person A runs into Tom Cruise while walking down the street. Person A says, “If you give me your address, I will mail you a check for $200.” He writes down his mailing address and hands it to Person A.
Tom Cruise- because he is famous. His address has more value to it. Person a is getting a benefit.