contracts questions ITT Forum

[swtlilsoni]

I don't want to keep making new threads for any contracts questions so I'll just use this one, and if anyone else has any contracts questions feel free to post them here as well.

question:
past consideration is not okay.
moral consideration is okay if you received a material benefit (even if it is in the past)
that seems contradictory...am i getting it right?

[Volake]

A good way to think of the moral obligation doctrine is to think of it as waiving a defense you had to a previous contract, like minority. Your promise to pay someone pursuant to a previous (invalid) contract will be enforceable. My professor calls it the "so-called moral obligation doctrine" because its scope is quite limited and may not render enforceable many promises that our intuitions might lead us to think we have a moral duty to act upon.

Even if one has conferred a benefit to you, a promise to pay them back won't be enforceable unless that benefit was conferred pursuant to a contract. This is why they say that past consideration is no consideration. (There actually is something in restitution dealing with a promise subsequent to a benefit given, but that's another matter not pertaining to the moral obligation doctrine).

EDIT: Actually, I think your question did have to do with the material benefit test, which allows a promise to be enforceable if it's given in response to some benefit conferred with an intent to charge. This has to do with restitution, which doesn't have to do with consideration, but rather recovering for a benefit which one gave to another, under certain circumstances. The one I just mentioned is one of those circumstances.

[MrSparkle]

Past consideration - On principle, because we want to enforce contracts that use a promise to induce action the promisor wants (i.e. a promise as a tool), we don't like past consideration because it no longer uses a promise as a tool to derive benefit; the promisor might not care about the promise he made, because he didn't get any added benefit as a result.

Material benefit rule - a quasi-contract idea for narrow situations where the parties did not have the opportunity to bargain, but there are indications that if they did, they would have arrived at an agreement that is whatever the court says it should be. Generally 2 situations, one with subsequent promise, and one without. In McGowin, there was a subsequent promise that recognized the past benefit of the employee saving his boss's life. In Cotnam, the doctor got restitution for trying to save the defendant who eventually died anyway, which was very narrow since doctors are professionals, and professionals have easily measured costs.

So it is contradictory in a way, but the main difference is whether there was the opportunity to bargain. With past consideration, there was no emergency or other situation when the parties couldn't bargain.

[dingbat]

I'd tag this for future use, but I'm up to my eyeballs in property right now

[swtlilsoni]

thanks for the responses, that makes a lot of sense.
I'm really worried about my Ks exam because no matter how much I prepare I feel like I'm not ready. I read all the cases/briefs, read the entire Calamari&Perrillo hornbook, took notes, made an outline, made a linked checklist on onenote, know all the basic concepts I covered pretty well, but when I do a practice exam, there's always something on there that relates to a different UCC statute, or restatement section, that I don't know. There are a million rules in contracts and I feel like I'm always getting blindsided with one I don't know. Is the only way to be prepared to know the entire restatement and the entire UCC??