BUSINESS LAW

Assignment#1

ASAD ULLAH SP17-BBA- 014

HAMZA IHSAN SP17-BBA-007
Ahmad Atta Tanoli SP17-BBA-013
CASE 1:
Brantford General Hospital Foundation v Marquis Estate [2003] O.J. No. 6218 (Ont.
S.C.J.), leave to appeal refused

RATIO: A promise to subscribe to a charity is not enforceable in the absence of a bargain. If

what you say is consideration does not come at the request of the donor, then that will not be
construed as consideration.

FACTS: M left hospital $2.8 million. Hospital named unit after him. In September 1998,
widow was presented with a formal proposal that outlined the project and the hospital's
interest in honouring her and the memory of Dr. Marquis by naming the new critical care unit
after them. Widow signed pledged to leave more money over 5 years. She died within the
first year and her estate refused to pay the balance of $800,000.

ISSUE: Is a pledge document a contract enforceable in law, or merely a “naked promise?”

DECISION: Action dismissed.

REASONS: Milanetti reaffirmed that Canadian courts follow English common law
concerning pledges, namely that a promise to subscribe to a charity is not enforceable in the
absence of consideration. Brantford held that their commitment to name the entirety of the
new unit in honour of Dr. and Mrs. Marquis constituted bona fide consideration. While there
was clear evidence that Mrs. Marquis was adamant that Dr. Marquis' recognition in the
coronary care portion of the unit be retained, including his name and picture, it did not find
the larger naming opportunity to be of vital importance to Mrs. Marquis in her decision to
pledge the funds as it was at the suggestion of the hospital. As the decision to name the unit
in honour of the Marquis' was still subject to board approval, it was difficult to say that this
constituted bona fide consideration.

Based on the foregoing, most particularly the evidence of all of the plaintiff’s witnesses
details the humble and modest nature of Mrs. Marquis, the court finds as a fact that she never
sought the naming of the unit as a condition for making the pledge. It was merely gratitude.
Widow did not bargain for the naming.
CASE 2:
Wood v Lucy Duff-Gordon 118 N.E. 241 (U.S. N.Y., 1917)

RATIO: A promise may be lacking, and yet the whole writing may be 'instinct with an
obligation,' imperfectly expressed.

FACTS: Defendant was a fashionable woman and designer capable of increasing the sales
of certain goods by her endorsement. Defendant entered into an exclusive agreement with
Plaintiff allowing him to place her endorsement and market defendant’s designs and keep
half of the profits. Plaintiff claimed she broke the contract by placing endorsements without
his knowledge and keeping all the profits too herself.

ISSUE: Is there an enforceable contract even when there is no express promise by one of the
parties?

DECISION: A promise to exclusively represent the interests of a party constituted sufficient

consideration to require enforcement of an unstated duty to use reasonable efforts based on
that promise. A promise may be lacking, and yet there might be "instinct with an obligation"
imperfectly expressed.

REASONS: Duff-Gordon claimed that there was no corresponding request to her promise –
she did not request anything from Wood, thus there was no consideration. Wood did not bind
himself to anything, and therefore there was no contract. However, Cardozo, writing for the
majority, said that it goes without saying that anyone who contracts to do this type of thing
will do his or her best. Wood's promise to render accounts and to give DuffGordon 50% of
the profits inherently implied that he would use reasonable effort to implement the
agreement.
CASE 3:
Eastwood v Kenyon (1840), 11 Ad. & E. 438, 113 E.R. 482 (Q.B.)

RATIO: Past consideration is no consideration. Past consideration is no consideration

because it provides no link between the alleged consideration and the promise made.

FACTS: John Sutcliffe died and left Eastwood as the guardian to his infant daughter, Sarah.
Eastwood borrowed money to pay for Sarah's education and Sarah promised to pay him back
when she came of age and paid one year's interest to him. Sarah then married Kenyon who
also promised to pay Eastwood back. Kenyon failed to do so and Eastwood sued. Kenyon
said that he will pay the money after he got a child from Sarah.

ISSUE: Is a promise sufficient to form a contract?

DECISION: No contract was found to have existed. Consideration made in the past is no
consideration at all.

REASONS: The court found that on the facts there was nothing more than a benefit
voluntarily conferred by Eastwood and an express promise made by Kenyon to repay the
money. Kenyon promised to pay the promissory note, but Eastwood gives nothing back but a
thank you. How can doing something in the past affect a current promise? Taking care of
Sarah was not done at Kenyon’s request, it simply couldn’t be. There is no link. Note
however that if Eastwood sued Sarah, that would be enforceable because she reaffirmed the
contract after she became an adult, as an exception to the common law rule of infant
contracts.
CASE 4 :
Lampleigh v Brathwait (1615), Hobart 105, 80 E.R. 255 (K.B.)

RATIO: A promise made after performance can be enforced, only if it was understood by the
parties that there will have some kind of reward prior the performance (contract quantum
meruit – a reasonable amount). To be enforceable, (1) the act performed must have be at the
request of the promisor, (2) it must be understood that payment would be made, and (3) if
payment, promised in advance, would have been enforceable (i.e. the contract can not be
illegal).

FACTS: Brathwait killed a man and then requested Lampleigh seek a pardon for this crime
from the King. Lampleigh rode around the country to obtain this pardon, after which
Brathwait promised to pay Lampleigh £100.

ISSUE: Can a promise to pay after a request has been fulfilled be binding?

DECISION: Binding contract found, judgment for the plaintiff.

REASONS: It was only after Lampleigh returned that Brathwait promised to pay. Is this
past consideration? Even though the official promise to pay came second, that does not
matter because there is an implied promise of reasonable pay. The court held that while a
mere voluntary promise is not sufficient consideration, there was a prior request and then the
promise to pay. This is then not a nudum pactum, but rather coupled with the prior request
and therefore a binding contract.
CASE 5:
Thomas v Thomas (1842), 2 Q.B. 851, 114 E.R. 330
FACTS: Executors of deceased's estate allowed his widow to live in one of his houses as
long as she remained a widow, in consideration of the testator's wishes (not explicitly in the
will or in contractual form). Subject to the widow paying $1 annually as ground rent and
keeping the house in tenantable repair. An action for ejectment was then brought by one of
the executors.
ISSUE: Was there consideration?
DECISION: Consideration - and therefore a contract was made. Mere motive need not be
stated and we are not obliged to look for the legal consideration in any particular part of the
instrument, we may look to any part.
REASONS: The issue is that the widow was gifted the ability to live in the house, with the
ability of revocation. For non revocation of a gift, there must be an intention to donate, an
acceptance of the gift, and a sufficient act of delivery. The Plaintiff is saying that the payment
of money is just the burden of a revocable gift, and not consideration. In this case, the court
says we do not know what the lease says, so it is not a gift with a burden.