Question 1

Simon is told by his lawyer that a particular document must be signed under seal. When Simon questions whether that isn't cruelty to animals, his lawyer explains that this is simply a process by which a written document can be made binding even if there is no consideration present.

Accepted Answer

Signing a document under seal refers to a legal formality that can make a contract enforceable even without consideration, which is a traditional requirement for contract validity. It does not involve animals.

Question 2

In a letter to his nephew, Peter, Mortimer promised to leave Peter all his money when he died in memory of Peter's father for whom Mortimer had great respect. There is nothing Peter could do to ensure that Mortimer will keep his promise since it is gratuitous, and a gratuitous promise can never be made enforceable.

Accepted Answer

A gratuitous promise, which is a promise made without consideration, is generally not enforceable in contract law unless it is formalized in a legally binding document such as a will or trust.

Question 3

X owed Y a debt in the amount of $1,000. The debt was payable on June 1^st. If X offered the $900 on the day before the due date, and Y accepted the money as payment in full, at common law, he could not later demand the remaining $100.

Accepted Answer

At common law, if a creditor accepts a lesser amount than owed as full payment before the due date, it is considered an accord and satisfaction, and the creditor cannot later claim the remaining balance.

Question 4

Anderson, a city employee, collected garbage along Smyth's street on Thursday of each week. One day Smyth said to Anderson: "You have done such a good job; I will give you $10 when you come by next week." The next week, when Anderson made his regular garbage pickup for the city, he met Smyth and asked for the $10. Smyth refused to pay. The reason why Anderson would be unable to show consideration is that, as a city employee, he was already bound to collect Smyth's garbage as a part of his duty to his employer.

Accepted Answer

Anderson cannot show consideration for the $10 because he was already obligated to collect Smyth's garbage as part of his existing duties as a city employee.

Question 5

A and B are neighbours. Before A left on a holiday, he asked B to "keep an eye on his house." While A was on holidays, B noticed that A's lawn was in need of cutting and proceeded to cut the lawn. On A's return from his holiday, B demanded $10 for cutting the lawn. If B should take legal action against A to collect the $10, and the court agreed that he was entitled to recover quantum meruit, he would not necessarily be entitled to the $10, but only to a reasonable price for his services.

Accepted Answer

Quantum meruit is a legal principle that allows a person to recover a reasonable amount for services rendered when there is no agreed-upon price, meaning B could be entitled to compensation, but it would be based on what the court deems reasonable, not necessarily the $10 he demanded.

Question 6

Mary Jo relied upon a promise made to her by David. As a result of David's failure to fulfill the promise, Mary Jo has incurred expenses for which she cannot now be compensated. She tells you that she wants to sue David and make him live up to his promise. You would be right if you told her that she would have a better chance of succeeding if she were in the United States.

Accepted Answer

The answer of Mary Jo relied upon a promise made...

Question 7

A and B are neighbours. Before A left on a holiday, he asked B to "keep an eye on his house." While A was on holidays, B noticed that A's lawn was in need of cutting and proceeded to cut the lawn. On A's return from his holiday, B demanded $10 for cutting the lawn. If B was entitled to claim quantum meruit, and the regular price charged by persons who mow lawns in that area was $10, B would probably be awarded $10 by the court.

Accepted Answer

Quantum meruit is a legal principle where a person can recover the reasonable value of services provided when those services were requested or accepted under circumstances where payment is expected. Since B provided a service that was beneficial to A and the service has a recognized value ($10) in their area, B could likely be awarded $10 by the court under the principle of quantum meruit, assuming there was an expectation of compensation for such services.

Question 8

X owed Y a debt in the amount of $1,000. The debt was payable on June 1^st. If X offered Y the sum of $900 on the due date as payment in full, at common law, Y would be entitled to collect the remaining $100 even though he accepted the lesser sum as payment in full on the due date.

Accepted Answer

At common law, the acceptance of a lesser sum on the due date does not discharge the debtor from the obligation to pay the full amount unless there is some form of new consideration or a different agreement made.

Question 9

Zena decided not to honour the pledge form she had filled out for a local charity. Since her pledge was in writing and signed by her, it is enforceable by the charity.

Accepted Answer

A pledge to a charity is generally considered a promise to make a gift, which is not enforceable under contract law unless there is consideration, a mutual exchange of value, which is typically absent in the case of a donation.

Question 10

McSweeney agrees to clear out Brown's basement, but no price is set at the time. Brown argues, once McSweeney has done the work, that since no price was agreed upon he should pay only a reasonable price and not the excessive amount stated in the bill presented to him by McSweeney. He is right.

Accepted Answer

In the absence of a pre-agreed price, the law typically requires the payment of a reasonable price for services rendered, which is determined based on the nature of the work and prevailing market rates, rather than any excessive amount billed.

Question 11

Anderson, a city employee, collected garbage along Smyth's street on Thursday of each week. One day Smyth said to Anderson: "You have done such a good job; I will give you $10 when you come by next week." The next week, when Anderson made his regular garbage pickup for the city, he met Smyth and asked for the $10. Smyth refused to pay. Smyth is not legally required to pay the $10.

Accepted Answer

Smyth's promise to pay $10 was a gratuitous promise without consideration, making it unenforceable as a contract.

Question 12

Jeremy agrees not to sue Angela for having crashed into his car if she agrees to pay for his repairs. Since he only promised not to do something which he could have done, he has not given consideration for her promise to pay.

Accepted Answer

Consideration in a contract can be an act, a forbearance (choosing not to do something one has the right to do, like suing), or a promise to do either. Jeremy's promise not to sue Angela is a valid consideration because he is giving up his legal right to sue her in exchange for her promise to pay for the repairs.

Question 13

X owed Y a debt in the amount of $1,000. The debt was payable on June 1^st. If Z paid $900 as settlement for the debt owed by X to Y, Z would be entitled to an assignment of the debt owed by X and could collect the debt from him.

Accepted Answer

Z would be entitled to an assignment of the debt owed by X and could collect the debt from him.

Question 14

X owed Y a debt in the amount of $1,000. The debt was payable on June 1^st. In Ontario, and in Western Canada under statute law, if Y accepted the lesser sum as payment in full on the due date, he would not be entitled to collect the remaining $100.

Accepted Answer

Under the common law principle of accord and satisfaction, if a debtor offers a lesser amount as full payment on the due date and the creditor accepts it, the agreement is binding, and the creditor cannot later claim the remaining amount. This principle is recognized in Ontario and Western Canada through statute law, which codifies this common law principle, making the acceptance of a lesser sum as full payment legally binding and preventing the creditor from pursuing the remaining balance.

Question 15

Anderson, a city employee, collected garbage along Smyth's street on Thursday of each week. One day Smyth said to Anderson: "You have done such a good job; I will give you $10 when you come by next week." The next week, when Anderson made his regular garbage pickup for the city, he met Smyth and asked for the $10. Smyth refused to pay. Smyth is obliged to pay Anderson the $10, because he promised him the money.

Accepted Answer

A promise to make a gift, such as Smyth's promise to give Anderson $10, is generally not enforceable as a contract because there is no consideration (something of value exchanged) from Anderson in return for the promise.

Question 16

Anderson, a city employee, collected garbage along Smyth's street on Thursday of each week. One day Smyth said to Anderson: "You have done such a good job; I will give you $10 when you come by next week." The next week, when Anderson made his regular garbage pickup for the city, he met Smyth and asked for the $10. Smyth refused to pay. Smyth is not obliged to pay Anderson the $10, because his promise was gratuitous.

Accepted Answer

Smyth's promise to pay Anderson $10 was a gratuitous promise, meaning it was made without receiving anything in return (consideration) from Anderson, as Anderson was already obligated to collect the garbage as part of his job duties. Without consideration, the promise is not enforceable under contract law.

Question 17

Mr. Ying, a successful lawyer, is asked by his daughter's daycare to do their legal work on a voluntary, unpaid basis and, since it is minimal, he agrees. As the result of an error he makes in drawing up the daycare's standard employment contract, a mistake which would not have been made by the reasonable lawyer, the daycare has to compensate an employee who was let go for failure to meet the job requirements. Since Mr. Ying received no consideration for his work, the daycare cannot hold him liable in contract for its loss.

Accepted Answer

In contract law, consideration is a necessary element for a contract to be enforceable. Since Mr. Ying did not receive any consideration for his voluntary work, there is no enforceable contract, and thus he cannot be held liable for the loss.

Question 18

June, an underworld enforcer, beats up Jason under an agreement with Monty by which she is to be paid $5,000 for her work. Although each party has given consideration, June cannot use the courts to enforce the contract if Monty will not pay her.

Accepted Answer

The contract between June and Monty involves committing an illegal act (assault), which makes the contract unenforceable in court due to its illegality.

Question 19

Susan offered to pay $500 for a ring that Daria has agreed to sell to her. Each woman has given consideration to the other for her promise.

Accepted Answer

Consideration in a contract refers to something of value that each party agrees to give or do for the other. In this case, Susan's consideration is the $500 she has offered to pay, and Daria's consideration is the ring she has agreed to sell.

Question 20

X owed Y a debt in the amount of $1,000. The debt was payable on June 1^st. If Z, a friend of X, paid $900 to Y as payment in full of the debt owed by X, and Y accepted the sum, Y could not later demand the remaining $100 from X.

Accepted Answer

When Y accepted the $900 from Z as payment in full for the debt owed by X, it constituted an accord and satisfaction, which legally discharges the original debt, preventing Y from later demanding the remaining $100 from X.

Quiz 8: The Requirement of Consideration

Simon is told by his lawyer that a particular document must be signed under seal. When Simon questions whether that isn't cruelty to animals, his lawyer explains that this is simply a process by which a written document can be made binding even if there is no consideration present.

X owed Y a debt in the amount of $1,000. The debt was payable on June 1st. If X offered the $900 on the day before the due date, and Y accepted the money as payment in full, at common law, he could not later demand the remaining $100.

X owed Y a debt in the amount of $1,000. The debt was payable on June 1st. If X offered Y the sum of $900 on the due date as payment in full, at common law, Y would be entitled to collect the remaining $100 even though he accepted the lesser sum as payment in full on the due date.