Alex runs a graphic design business. Before discussing any compensation, Alex voluntarily creates a custom logo for Bailey's new startup without any promise of payment. Later, Bailey promises to pay Alex $2,000 for the logo. Alex relies on this promise and incurs expenses to support the startup.
Is Bailey's promise to pay Alex enforceable based on consideration?
Yes, because Alex provided valuable services by creating the logo.
Yes, because the expenses Alex incurred were in reliance on Bailey's promise.
No, because the work was done before Bailey made the promise, which constitutes past consideration.
No, because Bailey did not specify a time for payment.
Bailey's promise is not supported by valid consideration because Alex's act of creating the logo was done before any promise of payment, making it past consideration. For consideration to be valid, it must be a bargained-for exchange where the promise and the performance occur concurrently or the performance is in exchange for the promise.
Ask Bash
Bash is our AI bot, trained to help you pass your exam. AI Generated Content may display inaccurate information, always double-check anything important.
What is consideration in a contract?
Open an interactive chat with Bash
What is past consideration?
Open an interactive chat with Bash
What are the requirements for a promise to be enforceable?