The consideration must also be negotiated, which means that there is an exchange of promises and something of value where both parties receive a reward and get a disadvantage in the contract. It`s really easy! Let`s say John and Jamal are now negotiating the sale of a bike that was on display in the auto repair shop. John wants to start riding a bike, so he offers Jamal $50 in exchange for the product. Jamal will give the bike to John after receiving the money. So both sides negotiate and get a disadvantage. John`s bank account is reduced by $50.00, but he got new wheels. Jamal no longer has his bike but has $50.00 more. An exchange must be legally sufficient and negotiated between the parties for a contract to be considered a valid consideration. In November 2002, the Pollard Group learned that Labriola wanted to leave and immediately sent a letter to the potential employer informing them of the agreement signed by Labriola. Therefore, Labriola was not abandoned.
Five years after Labriola`s tenure, the Pollard Group asked him to sign a non-compete agreement and a confidentiality agreement requiring Labriola not to accept employment with a competitor 75 miles from Tacoma, Washington, for a period of three years. The problem with the new non-competitive agreement is that it did not contain sufficient legal consideration. Previous considerations include something that has already been given before the contract was signed. Sometimes we talk about executed consideration. For example, a person finds a lost wallet and returns it to its owner, who promises to pay $100 in a week. The return of the wallet is therefore an earlier consideration. Let`s take an example. M. Smith has a problem with the toilet in his home. He hires a plumber, Mrs.
Jones, to repair the toilet. Ms. Jones tells Mr. Smith that it will cost him $295 to do the work. He accepts and pays her the money. Then she repairs the toilet. In this example, the $295 was in exchange for Ms. Jones, and the toilet repair was a quid pro quo for Mr. Smith. Another case where there may not be sufficient legal value for a consideration is when someone is already legally required to do something. For example, a police officer cannot receive a reward for arresting a criminal, since the capture of criminals is already part of the police officer`s professional duties.
The consideration is only valid if the service (in this case, the capture of a criminal) is not normally required of someone. The value of the exchange must be legally sufficient. This means, among other things, that the consideration of each party must be equal. In our example, the $295 fee and work done to repair the toilet were about the same quality, so the consideration is legally sufficient and the contract is valid. The review must also be negotiated. This means that both parties must agree to waive something under the contract. In our example, Mr. Smith gave up $295 and Ms. Jones gave up her time and plumbing knowledge. They say that a rose is a rose is a rose.
And that`s true for most. But in contract law, a contract is not always a contract. In other words, a contract needs six elements to be considered enforceable. It must contain the following: • The consideration that must be provided to make a contract legally binding is legally sufficient and has a bargaining value given by the promisor in exchange for the fact that the promisor takes or refrains from taking any action that results in a disadvantage for the donor and/or an advantage for the recipient. «A negotiated exchange where there is a legal determinant for the promisor or a legal advantage for the promise.» The consideration must also be negotiated to be valid. It simply means that both parties agree to receive a reward and receive a disadvantage in the contract. In our example, Mr. Smith received an award: his toilet was repaired. But he also had a disadvantage: he gave up $295. Conversely, Ms.
Jones` reward earned $295, and the downside was repairing Mr. Smith`s toilet. As described above, the consideration does not need to be reasonable, but must be negotiated by both parties and legally sufficient. Legally sufficient means that the consideration consists of: • Illusory promises: If the terms of a contract require performance in terms so clear that the promisor has not definitively promised (or omitted) dQ, the promise is unenforceable for lack of sufficient consideration. A few months later, Pollard restructured the way commissions were paid to sellers. In the previous contract, sellers had to sell at least $25,000 in print jobs to receive a commission. In the new contract, print sellers had to sell at least $60,000 in print jobs. This increase in the sales quota, if not realized, would reduce Labriola`s revenues by 25%. The contract also required sellers to pay all attorneys` fees if legal action is taken over the terms of the contract.
For this reason, Labriola decided to look for a job elsewhere. When you sign a contract, you may be wondering, «What do I get out of it?» The answer is consideration. Consideration is essentially what you get out of a contract. In our previous example, Mr. Smith obtained a functional toilet after signing a contract with Ms. Jones, and Ms. Jones received $295 from the same contract. When you buy groceries at the supermarket, your consideration is the food you bought, and the supermarket consideration is the money you paid them. In one famous example, football player Patrick Mahomes signed a contract as a quarterback with the Kansas City Chiefs. His return was $500 million, and the Chiefs` consideration was his promise to play football for them for twelve years.
If you have an idea of the best way to write about it Something of legally sufficient value may consist of a promise to do something you don`t have, please contact us immediately. We would like to know more: [email protected] This consideration in business law includes valuables offered by each Contracting Party to the other Party. The consideration may be a currency or property, but it may also be a promise to perform a legal act or to refrain from doing so. Utilitarian ethics is a normative ethical system that deals primarily with the consequences of ethical decisions; Therefore, it can be described as a teleological or consequentialist theory. This work, «Something of Legally Sufficient Value, May Consist of the Promise to Do Something You Don`t Have» was written and submitted by your classmate. You can use this example for research and reference purposes to create your own article. The use of parts of the work without proper indication of the source is prohibited. Reciprocity refers to the agreement between the parties to the contract to comply with its terms. Capacity refers to the fact that each party is mentally strong enough to understand what they are accepting and old enough to make a deal.