Consideration & Preexisting Duty Rule
What are the exceptions to the pre-existing duty rule?
(1) Change in performance; (2) Third party promising to pay; (3) Unforeseen difficulties that would excuse performance; (4) Promisee's duty is contractually owed to a third person
Common law modification
- Modifications must be supported by consideration. - 2 exceptions: (1) rescission + new K; (2) unforeseen difficulties + one party agrees to compensate when difficulties are discovered, if difficulties make performance impracticable
If a creditor agrees to accept a lesser amount in full satisfaction of debt, is the original debt discharged?
- Only when EITHER (1) there is some dispute as to the validity of the debt or amount of debt; OR (2) payment is of a different type than called for under the original contract - This is an accord & satisfaction
What happens if the debtor breaches an accord? What can the creditor recover?
Either the original contract OR the accord agreement
UCC modification
No consideration necessary; only good faith required
NY Past Consideration
Promise in exchange for past consideration is valid if the past/executed consideration is (i) expressed in writing, (ii) is proved to have been given or performed; (iii) would be deemed valid consideration at the time it was given or performed
NY modification
Written agreement to change or modify K is valid if in writing and signed by party against whom it is to be enforced
