The general rule is that each contract must meet the requirement of having consideration. This means that each party must give something of value and there must be a bargained for exchange. In a new thread, please answer the following questions:
1. Please explain the purpose of consideration and why this element is necessary for contracts. Please reference a case to support your explanation.
2. Do you think that the doctrine of promissory estoppel should apply as an exception to consideration? Why or why not?
Write two reply for this two example discussions.demonstrating that you have read their posts
Additionally, please also be sure to stay on topic and limit your discussion to only the questions posed. Please conduct yourself in the discussion board as you would in a professional, business environment. The Language should be appropriate for a professional context.
The purpose of consideration is to show the seller that you are serious and will show that buy putting money or something of value up front. Consideration is a necessity in contracts because it binds the promise of the parties; it legitimizes the contract that is being made by having the party place something of value. For example in the case of Lambert v. Barron, where lambert was a construction helping consultant that charges $3,100 a month for his time and Barron (a friend) who seemed to be in financial trouble concerning his construction projects. Lambert took a plane that Barron paid for because Lambert became concerned with Barron’s personal problems; during Lambert’s time with Barron, Lambert had the idea that Barron was agreeing to $3,100 a month consulting service but Barron had no intention of actually being in that contract, given Barron had not paid any form of “consideration” besides paying Lambert for his time. If there was consideration paid (Maybe the reason for lambert calling to ask for more money) or any form of an earnest money deposit of some sort than lambert would of had a case. Barron obviously had no intention in being in a contract and it was quite clear that way. No, The doctrine of promissory estoppel should not be an exception to consideration at all. It destroys the whole point of consideration and the reasoning to why someone would pay consideration, you see; it’s not about the promise because anyone can go out and make promises left and right, it is about the willingness of that person to act on their promise, that’s why consideration must be paid.
Consideration is the element of a contract validating the fact that something of value was at the center of an agreement between the parties. For example, something of value could include a monetary sum, performing a service, or simply promising to refrain from performing a service. The importance of consideration is that it differentiates a contract from a gift, which in contrast does not require or expect something in return. In a court of law, only contracts in which something of value is expected in return by one party to another can be enforceable. For example, in the case of “Margeson v. Artis”, the initial exchange and promise was a weightless company in return for $125,000. However, the offerer in the case, the Margeson’s, ended up raising the price an additional $30,000 through an addendum, while promising nothing more than what was promised in the additional $125,000 contract, being the business. As a result, the court ruled that there was no consideration in the price-hike and therefore, the offeree, Artis, did not have to pay it. This case really exemplifies the core principle of contract law that is mutual-benefit, referred to as consideration.
When it comes to the doctrine of promissory estoppel, I do think that it should apply as an exception to consideration for the single reason that it protects those who have been harmed as a result of relying on a promise. Promissory estoppel requires the elements of a promise, a reliance on said promise, and injustice as a result of said reliance. The key element to me is that injustice has occurred as a result of relying on a promise. In theory, promissory estoppel should deter people from using the lack of consideration present as a means to make a promise that could potentially harm another individual.