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A offers a reward to whoever produces evidence leading to the arrest and conviction of murderer B.  C produces such evidence in the performance of her duties as a police officer.
Pre-existing Duty (#1)

No consideration.  The police officer is under a preexisting duty that runs to the public at large.  There is also a strong public policy argument -- you don’t want public servants to concentrate their efforts on certain private causes for extra money.
Same facts as above, but C’s police duties are limited to State X and, while on vacation in State Y, C gathers evidence about the crime in State Y.
Pre-existing Duty (#2)

Yes, there is consideration for this performance.  The officer’s duty does not run to the citizens of State Y, so the officer is not under a preexisting duty.
A, an architect, agrees with B to superintend a construction project for a fixed fee.  During the course of the project, without excuse, A takes away his plans and refuses to continue work.  B promises extra money to A so that A will resume work.
Pre-existing Duty (#3)

No consideration.  This hypothetical raises the classic “hold-up” concern.
A owes B a liquidated debt of $100 that is due on September 15.  A offers to pay B $50 on the first of September instead of the $100 due on the 15th of September.
Pre-existing Duty (#4)

Yes, there is consideration because there has been a slight change in the terms.  Courts dislike the preexisting duty rule so much that they often let parties modify contracts with very slight changes even though the efforts appear to be form over substance.
A is employed by B for $100 a month.  The contract calls for A to work for one year, with a termination date in December.  In October, A is offered a job by Company C for $115 a month.  A and B agree to tear up the existing contract and to execute a new contract with a termination date in December for $110 a month.
Pre-existing Duty (#5)

The Restatement (Second) would enforce this contract as modified because the new promise is fair and equitable.  Some courts, especially in older decisions, might enforce the modified contract by adopting a “rescission” rationale.  Each discharged the other and then each bound themselves to the other and so there was consideration for the discharge and for the new agreement.  On the other hand, some courts might not find any consideration for the modification.
A is employed by B to ride B’s horse in a race.  C owns the dam of B’s horse and is also entitled to a prize if B’s horse wins the race.  C promises A a bonus if A wins.
Pre-existing Duty (#6)

The Restatement (Second) takes the position that there is consideration for A’s ride.  It reasons that in most circumstances a promise to do what one already owes to another is still good consideration because the evils of coercion and economic duress are not evident.  It reasons that the promise to perform an existing contractual duty made to a third party is consideration unless it is coercive.
A has made a contract to construct widgets for $10 per unit.  A discovers that he has made an error in calculating the cost and asks B to agree to a $12 per unit price.  B surveys competitors and finds that A’s $12 price is still competitive and so agrees.
Pre-existing Duty (#7)

Since this is more than likely the SALE OF GOODS, governed by the UCC, 2-209, (which has been adopted in Hawai’i) a modification made in good faith does not require consideration.
Murphy borrowed money from Honolulu Federal Savings and Loan and Marsh unconditionally guaranteed the loan.  The unconditional guarantee would allow Honolulu Federal to proceed against either Murphy or Marsh or both if the money was not repaid.  Murphy defaulted on the loan.  “After Honfed had commenced this action, William M. Borthwick, Jr. (Borthwick), Honfed's President and Chief Executive Officer, agreed to Marsh's request ‘that Honfed [would] first proceed and conclude proceedings against the mortgage Honfed had in Murphy's house in Colorado ... before looking to Marsh to pay any amounts owing under the Murphy loan.’  In other words, Marsh argued that the unconditional Guaranty had been modified.”  Marsh asserted that the consideration for the oral modification was that Marsh gave Borthwick "certain information regarding the Colorado house" which Borthwick had requested and which Marsh had provided. Honfed argued that since Marsh's affidavit established that the undisclosed information about the Colorado house was requested and furnished after Borthwick had agreed to Honfed's forbearance against Marsh, the modification agreement was without consideration. The affidavit states, however, that Borthwick's request and Marsh's agreement to furnish the information were made "[d]uring the same conversation[.]"
Pre-existing Duty (#8) HOWEVER, Hawai’i (like most state jurisdictions) still requires consideration for contract modifications not governed by the UCC.  Honolulu Federal Savings and Loan v. Marsh, 753 P.2d 807 (Haw. App. 1988) stated:    

A written contract can subsequently be orally modified if all of the requisites of a valid or enforceable agreement are met.  Lo v. First Trust Co. of Hilo, 25 Haw. 185, 187-88 (1919). See also 17 Am.Jur.2d Contracts § 465 (1964). A requisite is that the modification must be supported by new consideration.…

Viewing the statement in the light most favorable to Marsh, we must conclude that Honfed's agreement to forbear and Marsh's agreement to provide the information were mutual reciprocal promises, which constitute good and sufficient consideration for a valid contract.
Dehn, a mechanic, is injured when Palmer’s employee negligently starts the automobile while Dehn is working under the hood.  Palmer drives Dehn to the hospital (two of Dehn’s fingers have been cut off).  On the way, Palmer says to Dehn, “I’m so sorry this happened.  I will take care of your expenses and see that you are compensated for this injury.”  Was there consideration for Palmer’s promise to pay Dehn’s expenses?
Consideration Problems (#1)

Question One is based on the Palmer v. Dehn, 198 S.W.2d 827 (Tenn. 1947).  The court held that there was an implied bargained-for return promise: in promising to pay for Dehn’s expenses, Palmer was asking for a return promise from Dehn to forbear from filing suit.  A leap from the brief conversation?  Yes, but a jury found that is what Palmer meant.  Remember, consideration can be implied from the structure of the transaction, it does not need to be expressly stated or labeled.
A baby was born to Happy Couple on December 17.  They name the child after their beloved grandfather, August, that very day.  On December 24, Grandfather August writes and says, “If you name the baby August (after me), I will give you $5,000.”  Was there consideration for Happy Couple’s performance of naming Baby August?
Consideration Problems (#2)

This case is taken from Lanfier v. Lanfier, 288 N.W. 104 (Iowa 1939).  The court held that the naming of the baby was not bargained for, since it had already occurred.  You could argue that the parents gave consideration by impliedly promising not to change the child’s name in return for the money.  You might win … Maybe you should have been the Happy Couple’s lawyer.
Tenant leased property from Landlord.  In the lease, the Tenant had an option to buy the property at the end of the lease.  The lease required that if Tenant needed more water, the Tenant would have to dig a well for water at the Tenant’s own expense.  The Tenant needed more water and the Landlord and Tenant agree to split the cost of the well. 

Can you identify a consideration problem here?  Can you figure out how to overcome the problem using the facts given?

Later, after the well was dug, the Landlord said, “Gee, If you exercise your option to buy the property, I’ll lose my investment in that well.”  The Tenant replied, “don’t worry, if I decide to exercise my option to buy the property, I’ll pay you back for the half of the expenses to dig the well that you paid.”  Later, the Tenant exercised its option but refused to pay Landlord back.  Was there consideration for Tenant’s promise to pay Landlord back?
Consideration Problems (#3) This case is taken from Stonestreet v. Southern Oil, 37 S.E.2d 676 (N.C. 1946).  The court held that the promise by the tenant to pay the landlord back for its half of the digging occurred after the well had been dug and therefore was not supported by bargained for consideration.  Instead, it was a mere gratuity. 

Interestingly, the Landlord’s initial promise to pay one-half of the cost even though the lease made the Tenant responsible to dig the well if the Tenant wanted more water, has a bit of a consideration problem.  But I think it is easily overcome when one remembers that the Landlord might get the property back at the end of the lease.  If so, the property would be more valuable with a well.  So the landlord might want to pay one-half the expenses, in order to induce the Tenant to dig the well.  Remember, the Tenant was supposed to pay for the well, but did not have to dig it if the Tenant did not want to do so.
Mary was the apple of Grandma’s eye.  Grandma promised Mary a rare antique spittoon that was worth $50,000 if Mary would pay to Sabrina, Grandma’s other granddaughter, $2,000 that Sabrina needed for college tuition.  Grandma intended this $2,000 as a gift for Sabrina.  Was there consideration for Grandma’s promise to give Mary the spittoon?  Does it matter that Mary will pay the money to Sabrina?
Consideration Problems (#4)

This example is taken from comments to the Restatement (Second) of Contracts § 71.  It introduces the concept of legal sufficiency of the consideration.  Notice the exchange is not equivalent.  Grandma is either making a very bad bargain or wants to make a gift.  Nevertheless the rule is, “Ordinarily, therefore, courts do not inquire into the adequacy of consideration, particularly where one or both of the values exchanged are difficult to measure.  Even where both parties know that a transaction is in part gift and in part a bargain, the element of bargain may furnish consideration for the entire transaction.  Does it matter that the consideration flows to a third party?  No, look at Restatement (Second) § 71 (4).  “The performance or return promise may be given to the promisor or to some other person.  It may be given by the promisee or some other person.”
Creditor was very worried that Debtor was about to go out of business, and would not be able to pay Creditor back all the money it owed.  So Creditor went to Debtor’s business and began to help Debtor operate the business and straighten out the books.  Debtor also owed Landlord for back rent and the Landlord was threatening to evict Debtor.  Creditor began making the payments to the Landlord, trying to get Debtor’s rent payment current.  Creditor explained to Landlord, “I’m just paying to try and straighten the business out.  I’m not taking over the business.”  Finally things got so bad that Creditor gave up and stopped paying Debtor’s bills.  Landlord then sued Creditor, claiming that Creditor had taken over Debtor’s rent. What result? What if instead Landlord had said, “I plan to evict Debtor this month.” Creditor replied, “please don’t evict Debtor.  If you do not evict Debtor, I will pay the rent.” 
Consideration Problems (#5)

 This is based on the Baehr v. Penn-O case.  If someone offers to pay the debts of another, that is a gratuitous promise.  If someone offers to pay the bills of another in return for a   forbearance, then there is consideration.  So in the actual case, the Creditor didn’t ask the Landlord for anything in return, so there was no consideration.  But had the Creditor asked the Landlord to forebear from evicting the Debtor, then there would have been consideration.
A promises to buy B’s car for $100 and B promises to sell his car to A. Consideration?
Consideration Hypos (#1)

Yes.  A suffered a detriment (a promise to pay $100) and B suffers a detriment (promise to give up his car). A enjoys the benefit of the car and B enjoys the benefit of the $100. RS § 71(1)(2): a performance or a return promise. Once you promise, you are bound. There has to be a promise for there to be a K.
A (with bad credit) wants to borrow $ from S&L.

B promises S&L that B will pay back A’s loan if A does not. Is there consideration for B’s promise to S&L?
Consideration Hypos (#2)

Yes.  Although B, the promisor, receives no apparent benefit, the S&L suffers a detriment as a result of B’s promise, namely that the S&L loaned $ to A.  B bargained for that benefit in exchange for B’s promise.  Notice the detriments or benefits can flow to third parties. Does not matter where the $ goes. Between B and S&L, there is CSN. RS 71(4).
A says, “If you meet me at Ala Moana, I’ll buy you the stereo you’ve been admiring at Sharper Image.

B says, “great, I’ll be there!” Is there consideration for B’s promise to go to Ala Moana?
Consideration Hypos (#3)

No.  This is most likely a condition of receiving the gift.  While B suffers a detriment (going downtown), A receives no apparent benefit, nor does it appear that A was attempting to induce B to make the trip.  The detriment (the trip) was not “bargained-for.”  Kirksey
A promises to give B $1,000. B promises to accept the $1,000. Consideration?
Consideration Hypos (#4)

No.  A (promisor) received a detriment, not a benefit.  B, the promisee, received a benefit, not a detriment.  A’s promise does not induce B to suffer a legal detriment.  Ricketts.
A promises B $100 if B doesn’t smoke until he is 21.  B does not smoke before the age of 21. Is there consideration for B’s performance?
Consideration Hypos (#5)

Yes.  A received no benefit (except personal satisfaction perhaps).  However, B did suffer a legal detriment (the right to smoke).  A bargained for that detriment in exchange for the promise to pay.  Hamer v. Sidway.
A says, “Because of your loyal service to the company, I promise to look after you with a check for $100 each month.” 

B accepts A’s promise. Is there consideration?
Consideration Hypos (#6)

No.  A has not made the promise in order to induce a promise or performance from B.  B’s performance was in the past and was not bargained for.  Plowman.
A, a lessor, says to B, the lessee, “The work you did around here is great, I want to pay you for half the cost of the paint and other materials.”  B accepts the promise. Consideration?
Consideration Hypos (#7)

No.  The detriment B suffered (the cost of repairs) was incurred in the past and A did not bargain for B’s repairs in exchange for A’s promise to pay half.  Stonestreet
A, estranged from B and longing to see him one last time before A dies, says, “Meet me downtown and I’ll buy you a stereo.” B agrees.  Consideration?
Consideration Hypos (#8)

Possibly.  A is receiving a benefit (seeing B).  B is suffering a detriment (the trip).  A bargained for the trip in exchange for the stereo.  A’s promise to give a stereo was intended to induce B to make the trip.  But with this hypo and some of the other examples on this page, do remember that in some states, a presumption exists that family and social engagement promises are not done as part of a bargain, but because of mutual affection.  You might have to make some factual arguments to overcome that presumption
A says, “I will pay you $100 not to drive my car tomorrow.” B, having no legal right to drive A’s car anyway, says, “I agree.” Consideration?
Consideration Hypos (#9)

There is no consideration if B has no legal right to drive the car, the consideration is legally insufficient.  However, if the right to drive the car were in dispute, then B’s promise to forbear would be consideration.  After all, B is giving up a potential legal right to drive the car.  Green, Fiege, Sylvester.
A says, “Son, you have been a dear child.  I want you to have my Kahala home that is worth $500,000 for $1.” B says, “It’s a deal!” Consideration?
Consideration Hypos (#10)

No.  The majority of states now reject nominal or sham consideration.  A did not bargain for the $1, it was only intended to reconstruct the gift transaction as a binding contract. Dougherty (are you making a deal for $1, no)
A says, “Son, you have been a dear child.  I want you to have my $500,000 home for $25,000.” B accepts. Consideration?
Consideration Hypos (#11)

Yes.  Courts rarely look at the adequacy of the consideration.  In addition, a partial gift/sale will usually be deemed wholly supported by consideration (Restatement 71 comm. C). Bargain for exchange, is it legally sufficient? Batsakis.
Abby orally promises to pay University, $100,000 in five annual installments for the purposes of its fund-raising campaign then in progress.  The promise is confirmed in writing by Abby’s agent, and two annual installments are made before Abby dies and Abby’s estate tries to back out of the promise.
Promissory Estoppel (#10)

This is enforceable even without any proven reliance.  Courts reason that others give based on the donations of others.  The Restatement makes a general rule that no reliance is necessary in charitable subscription cases.
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