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33. In an action against the chef for breach of contract, the sister will probably
A chef purchased the front portion of the land needed for a restaurant he desired to build and operate, but the back portion was the subject of a will dispute between a sister and brother. The sister's attorney advised that her claim was doubtful. The chef, knowing only that the unresolved dispute existed, agreed in a signed writing to pay the sister $6,000, payable $1,000 annually, in exchange for a quitclaim deed (a deed containing no warranties) from the sister, who promptly executed such a deed to the chef and received the chef's first annual payment. Shortly thereafter, the probate court handed down a decision in the brother's favor, ruling that the sister had no interest in the land. This decision has become final. The chef subsequently defaulted when his second annual installment came due.
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A promise is supported by consideration if two things are true: (i) the promisee is giving up something of value or circumscribes his liberty in some way to suffer a legal detriment; and (ii) the promisor makes his promise as part of a bargained-for exchange for the promisee's legal detriment. The «legal detriment» aspect is mainly important where it is not clear that one party has really given anything up in the bargain. The «bargain» aspect is dispositive in situations that do not involve business dealings, such as a promise to make a gift.
Courts at law do not inquire into the adequacy of consideration as long as the consideration was bargained-for; it is often said that «even a peppercorn will suffice» for consideration.
C is correct. In exchange for the chef's promise to pay the sister $6,000, the sister agreed to convey (and promptly followed through with conveying) to the chef a quitclaim deed for a piece of property. Even though the sister knew her claim to the property was doubtful and the deed did not contain a warranty of title, her promise to convey the quitclaim deed was sufficient consideration to support the chef's promise.
A is incorrect. What matters for finding consideration is the existence of an exchange, even if the values exchanged are unequal. The correct answer would be different if, instead of giving the quitclaim deed, the sister had promised to forebear from bringing a claim that she knew was doubtful.
B is incorrect. The «legal detriment» aspect is mainly important where it is not clear that one party has really given anything up in the bargain. The legal test for consideration focuses on the existence of a bargain rather than legal detriment.
D is incorrect. Promissory estoppel is a doctrine in contract law that stops a person from going back on a promise even if a legal contract does not exist. The chef paid the first $1,000 before he became aware of the true value of the quitclaim deed.