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Chapter 10

BUL 4310 Chapter Notes - Chapter 10: Usury, Unconscionability, Estoppel


Department
Business Law
Course Code
BUL 4310
Professor
Philip Kabler
Chapter
10

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Miller Chapter 10 Consideration, Capacity, and Legality
Consideration the value given in return for a promise
o Elements of Consideration:
Legally Sufficient Value something of value in the eyes of the law
Something that one has no prior legal duty to do
Forbearance refraining from an action that one has a legal right
to undertake
Bargained-For Exchange provide the basis for the bargain struck
between the contracting parties (separate from gifts)
o Adequacy of Consideration fairness of the bargain
o Agreements that Lack Consideration
Preexisting Duty legal duty then not legally sufficient consideration
Unforeseen Difficulties then can be legally sufficient
Rescission and New Contract rescind contract
Past Consideration promises made in returns for actions already done
Illusory promises terms of the contract have uncertainty of performance
that the promisor has not definitely promised to do anything (option-to-
cancel clauses)
Settlement of Claims
o Accord and Satisfaction debtor offers to pay a lesser amount than the creditor is
owed; amount of debt must be in dispute
Liquidated Debts accord & satisfaction cannot take place; amount has
been ascertained, fixed and settled
Unliquidated Debts debt amount is not settled
o Release contract in which one party forfeits the right to pursue a legal claim
Binding if: 1) given in good faith; 2) stated in a signed writing; 3)
consideration
o Covenant Not to Sue does not always prevent further recovery; substitute a
contractual obligation for some other type of legal action based on valid claim
Exceptions to the Consideration Requirements
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