• What is consideration?
• What is required for consideration to be
legally sufficient?
• What are some examples of contracts that
lack consideration?
• What is an accord and satisfaction?
• In what circumstances might a promise be
enforced despite a lack of consideration?
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• Generally, consideration must have:
–“Legally Sufficient Value” 
and
–a “Bargained-for-Exchange.” 
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• Legal Value can mean:
–Promise,
–Performance, or
–Forbearance. 
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• Bargained-For-Exchange:
–Must provide basis for the bargain.
–Something of legal value (a promise, or
a performance) must be exchanged
between the parties.
–The promise must be either:
• Legally detrimental to the promisee, or
Legally beneficial to the promisor.
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• Courts Typically Will Not Consider
Adequacy of Consideration.
– Law does not protect a person from
entering into an unwise contract.
– Cases of “shockingly inadequate
consideration” may raise a red flags, and be
rules unconscionable .
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• Preexisting Duty: promise to do what
one already has a legal duty to do does
not constitute legally sufficient
consideration.
–Exceptions:
• Unforeseen Difficulties.
• Rescission and New Contract.
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• Past Consideration is no
consideration because the
bargained-for exchange element is
missing.
–CASE 11.1 Access Organics, Inc.
Hernandez (2003). What would have
made this non-compete enforceable?
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• Illusory Promises.
–Promisor has not definitely promised
to do anything (no promise at all).
–Option-to-Cancel Clauses.
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• Accord and Satisfaction: debtor offers
to pay a lesser amount than the
creditor purports to be owed.
–Liquidated Debt: amount has been
ascertained, fixed, agreed on, settled,
or exactly determined.
–Unliquidated Debt: Parties give up legal
right to contest the amount in dispute,
and thus consideration is given.
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• Release bars any further recovery
beyond the terms stated in the
release.
• Covenant not to Sue is an agreement
to substitute contractual obligation
for some other type of legal action
based on a valid claim.
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• Promissory Estoppel (detrimental
reliance).
–Exception to the consideration
requirement.
–A person who has reasonably and
substantially relied on the promise of
another can obtain some measure of
recovery, to avoid injustice. 
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• Required elements:
–Must be clear and definite promise.
–Promisee must justifiably rely on the
promise.
–Reliance is reasonable and
substantial.
–Justice will be served by enforcing
promise.
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• Application of the Doctrine of
Promissory Estoppel.
–Courts began to apply estoppel to
hardship or inequitable cases.
–CASE 11.2 1861 Group, LLC v. Wild
Oats Markets, Inc. (2010). What
could the landlord have done to make
the contract enforceable?
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