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Contracts: Classification, Agreement, and Consideration
Contracts: Classification, Agreement, and Consideration
Chapter 77
Chapter
Contracts: Classification,
Contracts: Classification,
Agreement, and
Agreement, and Consideration
Consideration
Slides developed by
Les Wiletzky Copyright © 2006 by Pearson Prentice-Hall. All rights reserved
Introduction
Contracts are the basis of many of our daily
activities
They provide the means for individuals and
businesses to sell and otherwise transfer
property, services, and other rights
Without enforceable contracts, commerce
would collapse
Offer
Offeror Offeree
Acceptance
Offeror makes an Offeree has the power
offer to the offeree to accept the offer and
create a contract
1. Agreement 2. Consideration
3. Contractual
4. Lawful Object
Capacity
Proper Dispatch
An acceptance must be properly addressed,
packaged, and posted to fall within the mailbox
rule
Illegal Consideration
A contract cannot be supported by a promise to refrain
from doing an illegal act because that is illegal
consideration
Contracts based on illegal consideration are void
Moral Obligations
Promises made out of a sense of moral obligation or honor
are generally not enforceable on the ground that they lack
consideration
Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 07 - 21
Contracts Lacking Consideration (2 of
2)
Preexisting Duty
A promise lacks consideration if a person promises to
perform an act or do something he or she is already under
an obligation to do
The promise is unenforceable because no new
consideration has been given
Past Consideration
Past consideration (e.g., prior acts) will not support a new
contract
New consideration must be given
Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 07 - 22
The United Nations Convention on Contracts
for the International Sale of Goods (CISG)
Applies to contracts for the international sale
of goods
i.e., the buyer and seller must have their places of
business in different countries
Additionally, either
both of the nations must be parties to the convention, or
the contract specifies that the CISG controls