...Yet another contract law question! (1 Viewer)

[MaryJane]

Hey dudes!

Was just wonder whether anyone knows what happens in regards to this senario:

A and B enter into a formal contract in which A was to pay B $1000 on completion of work. However, half-way through the job, B realises that he needs more money in order to complete the job by the deadline. So A pays B an additional $500, and B completes it all in time. A also pays the contract-specified amount ($1000) on completion.

Now, the second contract between A and B (for the $500) is a unilateral contract, right? So my question is whether the first and second contracts are related in anyway? Because A wants the $500 back, and it seems the only way they could possibly get it back is by arguing that B was at fault because they should have known at the onset that they would need more than just $1000....

it seems thats the only possible argument on A's side because B had fulfilled both contracts... argh! its so crap! And I know that in the end, A probably wont get his money back from B, but in the meantime, I need to write 2000 words on this!!

Any help would be v.v.v.v. appreciated!

 

[MoonlightSonata]

A and B enter into a formal contract in which A was to pay B $1000 on completion of work. However, half-way through the job, B realises that he needs more money in order to complete the job by the deadline. So A pays B an additional $500, and B completes it all in time. A also pays the contract-specified amount ($1000) on completion.

Now, the second contract between A and B (for the $500) is a unilateral contract, right? So my question is whether the first and second contracts are related in anyway? Because A wants the $500 back, and it seems the only way they could possibly get it back is by arguing that B was at fault because they should have known at the onset that they would need more than just $1000....

You must fit each problem into a relevant category -- look for what the issues are. The focus of this question is consideration.

Firstly, the second contract is not a unilateral contract, don't look at it like that.

A promised to pay $500 to B -- but there is no consideration here. A promise to perform an existing contractual duty is not good consideration: Wigan v Edwards; Stilk v Myrick. A is promising a fresh $500 and B is not offering anything new. So on the face of it, there is no second contract due to lack of consideration, and A would get the $500 back.

However, there are exceptions to the existing legal duty rule. There are about 5 exceptions, the one that might possibly apply is that of practical benefit. Where the modifying party (A) obtains a practical benefit from the beneficiary’s (B's) promise to perform an existing obligation, the existing legal duty rule will not apply: Williams v Roffey Bros. This rule has been accepted in Australia in Musumeci v Winadell, subject to 3 modifiactions:
1. The rule covers situations where modifying party (A) makes concession (eg. Accepts less)
2. Applies only where the promise has not been induced by unfair pressure
3. Performance by the beneficiary (B) must be seen to be worth more to the modifying party (A) than an award of damages against the beneficiary.

So if for example A needed the work done quickly for an event, that might be seen to be worth more to A than the damages they might get from suing B.

Hope that helps

 

[mr EaZy]

wow!
sonata.... where did you pull Wigan v Edwards from? did you like search "consideration" or did you happen to have it on paper somewhere from past work?

and jane, i dont think it was a unilateral contract, i think that is when you offer the general public a reward as an example- i cant think of any others.

but it was a bi-lateral as he used it initailly to make the worker finish the job on time.

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oh and great explanation of the part where A gets the money back btw,
the worker has agreed to complete the job for 1000, its his responsibility to do it ! nothing more to add. hmmm could there be two arguments here?

 

[Newbie]

would the payment of the 500 dollars mean that the first contract was nulled and they drew up a new contract where the job was done for 1500?

 

[Minai]

would the payment of the 500 dollars mean that the first contract was nulled and they drew up a new contract where the job was done for 1500?

No, because the 500 dollars cannot be consideration, as it is promising to pay for an existing contractual duty. I think moonlight sonata covered this thouroughly

 

[Newbie]

HI MINAI

you reckon i can be returning officer for comsoc?

 

[MoonlightSonata]

wow!
sonata.... where did you pull Wigan v Edwards from? did you like search "consideration" or did you happen to have it on paper somewhere from past work?

and jane, i dont think it was a unilateral contract, i think that is when you offer the general public a reward as an example- i cant think of any others.

but it was a bi-lateral as he used it initailly to make the worker finish the job on time.

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oh and great explanation of the part where A gets the money back btw,
the worker has agreed to complete the job for 1000, its his responsibility to do it ! nothing more to add. hmmm could there be two arguments here?

I have a disturbing passion for contract law

As for "his responsibility to do it," that isn't a legal principle - you have to argue using the law, not arbitrary assertions based on... some sort of moral position or what not

 

[MoonlightSonata]

would the payment of the 500 dollars mean that the first contract was nulled and they drew up a new contract where the job was done for 1500?

That is actually one of the ways around the existing legal duty rule: terminating the contract and starting a new one. You could mention that B might try and argue it, and then explain why it would not hold up - the argument would not be convincing because A paying $500 seperately and then $1000 on completion suggests two different contracts, not a new one.

 

[Newbie]

that denning fellow always tells us to take a step back and see whats really going on

 

[MaryJane]

Thank you all for your help! We havent done consideration which would explain my extreme lack of knowledge as to what to do (I'm reading ahead now..).

I thought contracts was fun to begin with, like torts (which I love), but really its pretty sucky! But I'm glad people like you Sonata exist!

 

[Minai]

HI MINAI

you reckon i can be returning officer for comsoc?

It's not up to me dude, wait till next semester and talk to President Ho.

Contracts was fun...cases seemed more definite than torts, which often left me with a feeling of "what if..."

 

[mr EaZy]

I found contracts very dull. I'd read the cases didn't stick as well as criminal law.

i did a bit of reading in contracts a few days ago, its not that bad
although i only read 2 and a 1/2 chaps. my book doesnt go into detail. im not a law student yet, im only a business student doing a law related subject.

 

[Newbie]

well right now
contracts > criminal
it seems that we're actually looking at points of law in contracts whereas crim is just rambling on about random shit

and i just read the relevant stuff for this topic today

 

[Frigid]

The funny thing is they force all of you to read the whole crim book!

*evil laugh*

LOL tim u bastard.

so if i'm given the opportunity to switch class, is Brown a good teacher?

 

[MoonlightSonata]

I have Nemes, and I had Brown for one class. Let me just say that Brown is a really nice teacher, very open-minded.

Agh.. I can't believe we have to read the whole book asq. This crime theory stuff is almost beginning to irritate me...

 

[Newbie]

crim would be much better if we actually got onto the crimes act

 

[Toodulu]

would you be able to modify the conditions of a contract where the offer was already accepted?

 

[Frigid]

would you be able to modify the conditions of a contract where the offer was already accepted?

Me: no Your Honour.

Toodz J: have you any authority on that answer?

Me: errr... no Your Honour.

Toodz J: then how can you be so sure?

Me: well Your Honour, once acceptance of offer is communicated to the offeror, assuming that the other fundamental aspects of a contract are fulfilled, there is seen to be a valid contract. However, i think it may assist the court better if i leave the answer in the submissions of my learned friend, Mr. MS.

 

[Newbie]

hi toodulu are you at unsw?

frigid do you do contracts?

 

[Frigid]

frigid do you do contracts?

i'm in sophie's mondy 4-6 class, but obviously i'm not very good man... this shucks...

toodz still in usyd, doing her com(lib std) i think.. unless she's hiding amongst all the other asians at unsw...