JD_done wrote:releasethehounds wrote:forza wrote:Ks gurus, I want to confirm something about the pre-existing duty rule and consideration.
As I understand it, a pre-existing duty is not valid consideration at common law, but can become valid if someone gives something in addition to what she's already obligated to give, or alters the consideration somehow. On this last point, can the alteration seriously be anything? E.g., I have a pre-existing duty to deliver a blue shirt with silver buttons to you. We agree that I'll give you a blue shirt with gold buttons on it instead and you now pay me more money. That's all copacetic, right? Even if it's just the tiniest alteration in the pre-existing performance obligation?
Should be good. You're giving me something you weren't legally obligated to give me (because you were legally obligated to give me a blue shirt with silver buttons) in exchange for something I wasn't legally obligated to give you (mas dinero).
I believe the alteration can be absolutely anything. There was an MBE where a performer was hired to do a show at a party with a leopard. She said she couldn't do it anymore but could do it with a white tiger for $500 more. THis was adequate additional consideration even though the trainer was basically refusing to perform the original contract.
Okay this is long and I seriously apologize in advance because I know I'm going beyond the scope of what everyone's talking about. Also this is partially just for me and I'm making people read it or scroll past it. But:
To be clear, as the quoted reply got attached to a UCC point, that's one of the reasons distinguishing between sale of goods and services contracts is so important. in the example with the shirt, that's a UCC deal because it's a sale of goods contract. There does NOT need to be valid additional consideration, just good faith. The UCC does not require additional consideration: it just requires good faith to be present.
Services deals are instead subject to the common law. In a services deal, each party has to do something they weren't required to do earlier. And by 'required' we mean, are they doing something additional under the contract that they were not obligated to do before. In the question referenced, it's a contract for services. And so for a valid modification, each party has to give valid consideration. She was legally obligated to perform with a leopard or lion or whatever the question was. She was not legally obligated to perform with a tiger. The party paying for the show was not legally obligated to pay $500 more. Each has taken on a legal obligation they did not have before. It gets confusing because we want to say 'the contract was for a performance and she's still required to perform. She didn't offer to wash someone's car as well, or something'. But thinking about it logically, the shows are likely completely different--different routine, different animal, different length, different props, different price. The idea behind entering into the the deal in the first place probably isn't 'i want a woman to come perform with an animal', the idea is probably 'i want a woman to come perform with a leopard' or lion or tiger or bear (oh my).
It gets even more confusing when you start to introduce risk. For example, when you get a question that says something like: " A has a contract to excavate and install a pool for B and B will pay $50,000. A begins work and encounters some level of sheet rock that will make the contract 10,000 more expensive to perform. A tells B about the sheet rock and that it will be more expensive to perform, then tells B it will not finish the pool without an additional payment of $10,000."
This is NOT a valid modification: Yes, now A has to excavate sheet rock and yes now it's going to be more expensive, but at the end of the day when you look at the contract, A is still just building a pool. B isn't getting anything additional: just the pool they already contracted to get. Removing the sheet rock is something that A has to do in order to do what they were already legally obligated to do. This case is one where foreseeability of the arising circumstance comes up: I know nothing about building pools or excavation, but I imagine it's pretty foreseeable that you'd start digging and encounter a layer of rock that is going to add expense to your job. But that's the risk you take as a contractor who builds or installs or whatever it is you do with a pool to make it appear.
At the end of the day, a modification of a services contract is a mini-contract of its own, and it needs consideration just like the contract it's piggy-backing onto did. I scared the crap out of myself because I literally just tried to analogize it to lesser included and greater included offenses in crim law, but the analogy actually kind of works: Can you fully perform the original contract and to the bargained for specification without doing this extra thing? No? then it's not valid consideration for a modification.
Can I complete this installation of this pool to the same contracted for specifications without removing this rock? No? Not consideration, because i had to do it to perform the contract anyways.
Can I perform a show with a leopard to the same contracted for specifications without performing a show with a tiger? Yes? Consideration. I didn't have to do it to perform the contract anyways because the contract was for a show with a particular animal (the fact that the performance with the leopard wasn't possible does not actually factor into the consideration analysis. It may factor in to a different argument centering around frustration of purpose, but not consideration)