What is illusory in contract law?
In contract law, an illusory promise is one that courts will not enforce. Illusory promises are so named because they merely hold the illusion of contract. For example, a promise of the form, “I will give you ten dollars if I feel like it,” is purely illusory and will not be enforced as a contract.
What do you understand by uncertain and illusory consideration?
An illusory promise is vague and uncertain rendering the obligation of the person making the vague promise vague and uncertain. The party making an ambiguous promise may not have a clear obligation to perform whereas the other party may a more definitive obligation.
When consideration becomes illusory or not real?
The consideration must have some value in the eye of taw. It must not be sham or illusory. The impossible’ acts and illusory or non-existing goods cannot support a contract. Therefore, real consideration comes from good consideration.
Is an illusory contract enforceable?
An illusory contract is a type of contract that is not enforceable due to its indefiniteness or lack of mutuality. The courts indicate that when a party has the option to perform an obligation or not, then no contract can be formed and neither side can be bound to its terms.
What is consideration in a contract?
Something bargained for and received by a promisor from a promisee. Common types of consideration include real or personal property, a return promise, some act, or a forbearance. Consideration or a valid substitute is required to have a contract. business law.
What illusory means?
: likely to mislead or deceive : false, deceptive an illusory plea bargain leading to a longer sentence than expected.
Which of the following meets the requirements of consideration?
Which of the following meets the requirements of consideration? A consideration involves the exchange of a legal value; a promise to refrain from crimes, to engage in a preexisting duty, or one without a binding obligation is not deemed a consideration.
How far is it true that an agreement without consideration is void?
Explanation 2: An agreement to which the consent of the promisor is freely given is not void merely because the consideration is inadequate; but the inadequacy of the consideration may be taken into account by the Court in determining the question whether the consent of the promisor was freely given.
What makes an illusory promise?
An illusory promise is one that is unenforceable. This is due to a lack of mutuality or indefiniteness where only one party is bound to perform. An illusory promise is based on deception or parameters that are indefinite, making it unclear what must be done or if performance is optional.
What is an illusory promise and why is it not valid consideration?
Illusory Promises: If the terms of a contract call for performance in such uncertain terms that the promisor has not definitely promised to dQ (or refrain from doing) anything, the promise is unenforceable for lack of sufficient consideration.
What are the 4 types of consideration?
The various types of consideration are (1) a promise, (2) an act other than a promise, (3) forbearance, (4) a change in a legal relation of the parties, (5) money, or (6) other property.
What do you mean by illusory contract?
Illusory contract is a contract between two parties in which the consideration for the contract is illusionary. In such contracts one party gives as consideration a promise that is so insubstantial that it would not result in or impose any obligations. Such promise would make the contract unenforceable. Illusory. Illiterate.
What is the difference between an illusory and a promise?
In contrast, an illusory contract, whether it is in written form or an oral promise, is only an illusion of a contract. In a legal context, a promise is linked to a contract.
What is the value of consideration in contract law?
When it comes to contract law, the legal value of consideration is far more important than the monetary value. In unilateral contracts, the promise from one party and the performance of the other constitute consideration. In bilateral contracts, the promises made by both parties constitute consideration.
Is illusory promise an exception to the rule of mutual obligation?
However, in some cases, a party to a bilateral contract may not be bound by the contract. One such instance is illusory promise, which allows the promisor to escape his obligation. So, an illusory promise is an exception to the rule of mutual obligation in bilateral agreements.