A Contract Is Said to Have Legal Value If

The Federal Insolvency Act contains certain procedural safeguards to ensure that the debtor knowingly receives confirmation of its debts. Its provisions include that the law requires the debtor to have confirmed the debt before it is discharged from bankruptcy; he then has sixty days to cancel his assertion. If the insolvent party is a natural person, the law also requires a hearing at which the consequences of his assertion must be explained, and the confirmation of certain consumer debts requires judicial approval if the debtor is not represented by a lawyer. Scrooge offers to buy caspar`s $700 motorcycle for $10 and a shiny new fountain pen (worth $5). Caspar agrees. Is this agreement supported by an appropriate counterpart? Yes, because both have agreed to give up something that belongs to them: Scrooge, money and pen; Caspar, the motorcycle. As a general rule, the courts do not deal with the economic relevance of the consideration, but with the question of whether it exists. As Judge Richard A. Posner put it, “To ask if there is a consideration is simply to ask whether it is an exchange situation and whether an agreement has been reached. To go further and consider whether the review is appropriate, the court should do what.

it is less well equipped than the parties – decide if the price (and other essential conditions) stated in the contract are reasonable. Richard A. Posner, Economic Analysis of Law (New York: Aspen, 1973), page 46 In short, “The courts do not question the relevance of the consideration.” A similar problem arises with production contracts and on-demand contracts. In a production contract, an agreement to sell all goods or services to a single person, the seller – say a coal company – agrees to sell all of its annual coal production to an electric utility company. Has it really agreed to produce and sell coal? What happens if the owner of the coal mine decides to stop production to take a gap year – is this a violation of the agreement? Yes. The law imposes an obligation on the seller to produce and sell a reasonable quantity. Similarly, if the electricity supplier were to enter into a contract to purchase all of its coal needs from the coal company – a demand contract, an agreement to purchase all the demand (for goods or services) from a single source. – could it decide to stop operations altogether and not take coal? No, it is necessary to take a reasonable amount. An agreement is a treaty and must therefore be supported by consideration. Suppose Jan owes Andy $7,000, due on November 1. On November 1, Jan paid only $3,500 in exchange for Andy`s promise to release Jan from the remaining debt.

Did Andy (the provocateur) make a binding promise? It did not do so because there is no consideration for the agreement. Jan did not suffer any damage; she received something (exemption from the obligation to pay the remaining $3,500), but she did not give up. But if Jan and Andy had agreed that Jan would pay the $3,500 out of $25. October, then there would be a consideration; Jan would have suffered legal prejudice if she had undertaken to make a payment earlier than the original contract required of her. If Jan had paid the $3,500 on November 11 and given Andy something else he would have accepted – a pen, a keg of beer, a peppercorn – the required inconvenience would have been there as well. As proposed in section 11.1 “General Outlook”, the contract requires the exchange of damages and benefits; In this case, it is presumed that the consideration is legally sufficientUnit of sufficient value to justify a consideration. Thus, the defendant Tilford Reppert remains the only legitimate plaintiff. Records show he was a deputy sheriff in Rockcastle County at the time of the arrest, but the arrest and recovery of the stolen money took place in Pulaski County. He was not within his jurisdiction and was therefore not legally obliged to make the arrest and therefore has the right to claim and receive the reward. In [citation], he said: A disputed debt arises when the parties have agreed (liquidated) the price or costs, but then conflict over their equity and then agree.

When this dispute is resolved, the parties have considered an agreement to accept a fixed amount as payment of the amount due. Suppose that in the case of the gallbladder, the patient agrees in advance to pay $8,000. Eight months after the operation and as a result of nausea and vomiting, the patient undergoes a second operation; Surgeons discover a surgical sponge embedded in the patient`s intestines. But what happens if, when cashing the cheque, the creditor reserves the right (in accordance with Articles 1 to 207) to take legal action for an amount greater than what the debtor offers? Courts are divided on this issue: with respect to the sale of goods subject to the UCC, some courts allow the creditor to sue the outstanding debt, even if the check is marked “fully paid,” and others do not. The UCC also allows one party to exonerate the other party without consideration in the absence of a breach and allows the parties to amend their contract in accordance with Article 2 without consideration. Uniform Commercial Code, §§ 2-209 para. 4 and art. 2-209 para.

1. The official comments on the UCC section add the following: “However, amendments made under this Act must comply with the good faith test required by this Act. The actual use of bad faith to prevent the performance of the original terms of the contract is excluded, and extortion of a “change” without a legitimate economic reason is ineffective as a breach of the obligation of good faith. Instead of protecting the parties, as other treaty defenses do, defenses of illegality and breach of public order seek to protect the public good and the integrity of the courts by refusing to perform certain types of contracts. Contracts for illegal or immoral conduct would not be enforced by the courts. Whatever their original historical purposes, and however archaic they may be, the doctrine of contemplation serves purposes that are still useful. .