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Exam 13: Consideration

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Question 31

True/False

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Performance can constitute the consideration that creates a contractual obligation.

A) True
B) False

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Question 32

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Legally sufficient consideration is something of value in the eyes of the law.

A) True
B) False

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Question 33

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A promise made in return for an act or event that has not yet taken place can be fully enforceable.

Fact Pattern 13-2​ Boyd defends against a breach-of-contract suit by College Credit Corporation by claiming that their deal-a student loan accruing interest at a certain rate and payable beginning on a certain date-was unfair because the consideration for their contract was inadequate. -Refer to Fact Pattern 13-2. A court is most likely to evaluate the adequacy of consideration if

If a promise is made, it will be enforced.

A transaction that lacks a bargained-for exchange lacks an element of consideration.

A contract that one party retains the exclusive right to cancel at any time is unenforceable.

Twyla's dock is damaged in an accident caused by Ulrich's negligence. Twyla agrees not to sue him if he will pay for the damage. If Ulrich fails to pay, Twyla can bring an action for breach of contract. This is

Fact Pattern 13-2​ Boyd defends against a breach-of-contract suit by College Credit Corporation by claiming that their deal-a student loan accruing interest at a certain rate and payable beginning on a certain date-was unfair because the consideration for their contract was inadequate. -Refer to Fact Pattern 13-2. "Adequacy" of consideration refers to

A covenant not to sue is against public policy.

​Fact Pattern 13-4 Teatro Restoration, Inc., begins renovating an old theater for Urban Edge Productions, but after three months Teatro demands an extra $250,000. Urban Edge agrees to pay. -Refer to Fact Pattern 13-4. If Teatro offers no reason for the extra $250,000, but says only that it will stop work if it is not paid, the agreement is

An illusory promise is an unenforceable promise.

Fact Pattern 13-1 Sports Bar & Grill and Tea & Tarts Bakery are adjacent businesses with adjoining parking lots. Sports Bar offers Tea & Tarts a discount on purchases if the bakery will not tow the cars of Sports Bar's patrons who park in the bakery's lot. -Refer to Fact Pattern 13-1. Tea & Tarts's forbearance from towing is legally sufficient consideration

If, during the performance of a contract, extraordinary difficulties arise that were totally unforeseen at the time the contract was formed, a court may allow an exception to the preexisting duty rule.

Kent buys Lizzie's house for $100,000, which is the fair market value of the house. If the contract is later disputed in court, the court is likely to declare Kent's consideration

Industrial Engineering, Inc., promises to give stock options to Jasmine for processes she has already designed for the firm. This promise is enforceable

Two parties can mutually agree to rescind a contract unless it is executory.

Carly pledges to donate $10,000 to Disaster Recovery Inc. (DRI) . On the basis of the pledge, DRI orders additional supplies. If Carly does not fulfill the pledge, a court may enforce it

Maria is the sheriff of Narez, Texas. Oscar robs a Narez gas station and a $500 reward is offered for his capture. When, later, Maria finds and arrests him, with respect to the reward, she can

Marketing Solutions Inc. promises to employ Niki as a software engineer. In reliance on the promise, Niki quits her job with Online Ad Company, but Marketing Solutions does not hire her. Most likely, Marketing Solutions is