Contract Law

[TrueTears]

Hi guys, I have a few questions relating to considerations in contract law, if anyone could clarify these issues, that'd be good, thanks

    In a bilateral contract each party is both a promisor and a promisee.

    Example:
    On 1 January Albert promises to sell his car to Beryl for $10,000. The car is to be given to Beryl on 1 February; on the same day Beryl is to give Albert the money.

So does that mean in this case, Albert is both a promisor and a promisee? Ie, he is a promisor because he promises to sell his car in exchange for Beryl's consideration (which in this case is the $10000). However, he is also a promisee because he gives consideration (selling his car) in exchange for Beryl's promise of $10000.

Is my understanding correct? Because I read that a consideration must move from the promisee, so does that mean in a bilateral contract, both parties will provide considerations because both can be considered as promisees?


Also for a unilateral contract which my book has defined as:

    A unilateral contract is one in which an offer is made inviting acceptance by actual performance rather than by a promise. Eg, the offer of a reward for the return of a lost dog is accepted by the return of the dog

So say, person A offers a reward of $100 for the return of his lost dog. Then Person A would be the promisor and person B (who finds the lost dog and returns it) would be the promisee. Now when the promisee returns the dog, he gives consideration to person A (ie, the dog), so person A has to fulfill his side of the agreement and give the reward of $100 to person B. But doesn't this $100 also constitute a consideration? However I thought the consideration only flows from the promisee to the promisor, but then why in this case, there is a consideration flowing from the promisor to the promisee as well?

Thanks

[zool3]

Here are my thoughts,

For the first part:

Yes, both parties are promisor and promisee because each person promises to do something. If you have the CACL textbook go to page 85 about "Excuted, executory and past consideration" last paragraph last sentence it says " In this case both promises remain to be performed in the future and each provides consideration for the other"




For the second part:

the dog is the consideration because it is something of value to the promisor, so hence consideration moves from "promisee to promisor". That is, the dog is being returned, is something valued to the promisor (the owner).

Does that make any sense?

I can ask my tutor on wednesday to clarify it unless you have your tute before then and can get the answer quicker

[lynt.br]

it's been a long time since I did contract formation but here is my very very hazy recollection (don't rely on this haha!)

In the case of a unilateral contract, only one party makes a 'promise' (e.g. the party offering to pay for the return of the dog). The promise constitutes part of the offer. The offer is accepted when someone finds and returns the dog. The person who finds the dog (the offeree) does not make a promise at any point. Otherwise they would be legally obliged to carry out the promise (i.e. legally obliged to find and return the dog), which we know is not the case. They are merely accepting the offeror's offer.

For a contract to be valid, both parties to the contract must give valuable consideration. It does not matter if they are 'promisor' or 'promisee' - ultimately both parties must offer some sort of valuable consideration to the other.

In the unilateral contract example, the offeror gives consideration by promising to pay $100 to whoever finds the dog. The consideration is the promise to pay $100. The offeree who finds the dog gives consideration by giving up their time and effort in finding the dog in reliance on the offeror's promise. Hence both parties have given consideration.

[LOVEPHYSICS]

I thought Lynt gave a pretty good explanation. I would add something on the doctrine of moving from the promisee. Essentially, the doctrine requires that only the person who has paid the price ( given an exchange that is quid pro quo/valuable consideration) of a promise could sue on it. For example, I promised you that I would pay Lynt a sum of money if he cooks dinner for me, and Lynt does just that, and I renege on my promise, your attempt to sue me successfully would be thwarted by the doctrine of consideration because you have not given valuable consideration moving to the promise that I have made.

Unless you can show otherwise, the point is that Lynt is the one cooking me dinner, you have not done anything which could constitute sufficient consideration.

Hope that clear things out. I find the Law textbooks not particularly helpful as well.