Английский язык для юристов. Предпринимательское право

accepted by commencement of the proposed project.

Problems may arise when the consideration involved in a contract is money and the parties disagree as to the amount of money that the debtor owes the creditor.

A disputed amount, or unliquidated amount, is one on which the parties never agreed. Final settlement of disputed claims may lead to misunderstanding, dispute, and lengthy negotiation. If a creditor accepts as full payment an amount that is less than the amount due, then the dispute has been settled by an accord and satisfaction. Accord is the implied or expressed acceptance of less than what has been billed the debtor. Satisfaction is the agreed-to settlement as contained in the accord. Only if the dispute is honest, made in good faith, and not superficial or trivial will the courts entertain arguments based on accord and satisfaction.

An undisputed amount, or liquidated amount, is one on which the parties have mutually agreed. Although a party may have second thoughts about the amount promised for goods or services rendered, the amount that was agreed to by the parties when they made their contract remains an undisputed amount. A partial payment in lieu of full payment when accepted by a creditor will not cancel an undisputed debt.

As a general rule, a contract is not enforceable if it lacks consideration.

Some jurisdictions have eliminated the element of consideration in a few specifically named contracts. Typical agreements falling into this category include promises bearing a seal, promises after discharge in bankruptcy, debts barred by the statute of limitations, promises enforced by promissory estoppel, and options governed by national law.

Persons discharged from indebtedness through bankruptcy may reaffirm and resume their obligations, as prompted, perhaps, by moral compulsion. The bankruptcy court must hold a hearing when a reaffirmation is intended, informing the debtor that reaffirmation is optional, not required, and informing the debtor of the legal consequences of reactivating a debt.

Laws known as statutes of limitations restrict the time within which a party is allowed to bring suit.

Under the doctrine of promissory estoppel, a promise may be enforceable without consideration. This doctrine is used, on occasion, to prevent injustice when a person changes his or her position significantly in reliance on another's promise and the promise is not fulfilled. The court will «estop» the person who made the promise from claiming that there was no consideration. Certain conditions must be met, however, before a court will apply this principle. First, the promise must be made to bring about action or forbearance by another person who gave no consideration. Second, the one who gave no consideration must have relied on the promise and must have changed his or her position in a significant way. Third, injustice can be avoided only by enforcing the promise.

An option is the giving of consideration to support an offerer's promise to hold an offer open for a stated or reasonable length of time. The modern trade law has made an exception to the rule requiring consideration when the offer is made by a merchant; in such cases, an offer in writing by a merchant, stating the time period during which the offer will remain open, is enforceable without consideration.

Certain promises, however, the courts do not enforce because they lack even the rudimentary qualities of valid consideration. Included in this category are illusory promises, promises of future gifts, promises of legacies, promises based on past consideration, and promises based on preexisting duties.

An illusory promise is one that does not obligate the promisor to anything. A party who makes an illusory promise is the only one with any right to determine whether the other party will be benefited in any way. An illusory promise fails to provide the mutuality of promises required in establishing consideration.

Exercise 1. Comprehension questions:

1. Explain the term detriment.

2. What does the concept of bargaining mean?

3. When aren't the parties free to negotiate privately the amount of money to be paid?

4. Which problems might arise with consideration?

5. What does statute of limitation suppose?

6. Explain the doctrine of promissory estoppel.

7. When are charitable pledges used as consideration?

Exercise 2. Find in the text English equivalents to the following:

Согласие; встречное удовлетворение; ущерб; воздержание от действия; нереальное обещание; дискреционное право; предшествующее встречное удовлетворение; залогодержатель; ранее существовавшие обязательства; лишение права возражения на основании данного обещания; отказ от права; передача права другому лицу; документ об отказе от права или о передаче права; исполнение; закон об исковой давности; недобросовестный.

Exercise 3. Consult recommended dictionaries and give words or phrases to the following definitions:

Встречное требование; зачет встречного требования; однородное требование; предпочтительное удовлетворение требований; встречное заявление; основное требование; встречное удовлетворение; удовлетворение в части; оставление без удовлетворения.

Exercise 4. Be ready to talk on one of the following topics:

1. Explain the term consideration and identify the characteristics necessary for valid consideration.

2. Describe the attitude of the court when dealing with questions that involve the adequacy of consideration.

3. Discuss the types of consideration that can be used to bind parties to one another in a contractual situation.

4. Outline the procedure that a debtor and creditor may use to settle a claim by means of accord and satisfaction.

5. Identify those agreements that may be enforceable by a court of law even though they lack consideration.

Exercise 5. Make up your own dialog on the case:

In Hanna v. Perkins, the buyer tendered a check with the notation «in full for labor and material to date.» The seller indorsed the check «Deposited under Protest» and deposited it. Seller sued for the balance of the contract price and buyer moved for summary judgment on the ground of accord and satisfaction. The New York court held for the seller and said that the defendant failed to allege the existence of an honest dispute about the amount due and thus there was no accord and satisfaction. The court held:

If it were not that this court finds that triable issues of fact are present, this court would deny the motion by holding this particular section of the code would seem to favor plaintiff's overriding endorsement of «Deposited under protest» as a reservation of his right to collect payment of the balance.

Exercise 6. Resume in industry buzz:

Consideration (each party makes 1 consideratn supported prom.)

1. 3 Tests for Consideration:

a. Prom. must induce current perf. in exchange (bargained for exchange).

b. Detriment from Promisor (offering detriment).

c. Promise binding, not illusory (mutuality of the prom.).

2. Promise Induced for Current Perf. in Exchange (giving $ or conduct):

a. Promises based on moral feelings FAIL.

b. Promises based on past acts & don't ask anything currently in exchange FAIL, EXCEPT:

(1) debt barred by technical defense, new written promise to revive enforceable (amt stated up to debt).

(2) Promisor requested act & promisee perf. w/ expectation of paymt, most enforce payment.

3. Detriment From Promisor (detriment to Promisee) Doing something promisor not otherwise required to do or NOT doing something promisor has rt or good faith belief had rt to do (can be a legal disadv. – not smoking):