Question

1. Mark tried to purchase some goods on credit from Billy. Billy refused to sell him the goods because he did not believe Mark would be able to pay. Steve orally promised Billy that he would pay for the goods if Mark failed to do so. If Billy sells the goods to Mark, is Steve legally bound by his promise? Explain your answer.

2. DeRoller was the executor of his mother’s estate. Because there were insufficient funds in the estate to pay all its debts, DeRoller orally promised several creditors that he would pay the balance out of his own funds. Can DeRoller be held legally responsible for his promise? Explain your answer.

3. Bain orally agreed to sell some land to Carroll for $10,000 and accepted a deposit of $1,000 to bind the agreement. Later, on learning that another buyer would pay a higher price, Bain refused to honor the contract with Carroll. Carroll sued to enforce the contract. Did Carroll succeed in this suit? Explain your answer.

4. On July 15, 1992, Martin orally agreed to work for Stein until June 1, 1993. Was this contract enforceable? Explain your answer.

Answer 1

Answer 1 :-

As per the doctrine of promissory estoppel the legal principle states that a promise is enforceable by law even if it is made without a formal consideration when a promise you have made a promise to a promisee who then relies on that promise to a subsequent detriment. Promissory estoppel health injured parties to recover on promises made that have led to economic loss when not made.

Therefore in the above case as Billy has given credit to mark by trusting Steve's promise to repay the Debt in case of default therefore this oral contract is valid and enforceable in law.

Answer 2 :-

As per the general rule no beneficiaries are liable for the debt of the deceased just because they have inherited estate from the deceased .However there are certain exceptions to this rule .

1) the beneficiary would be personally liable if he has acted to defraud the creditors.

2) if he has voluntary assume liability or guarantee payments to the creditors of the deceased .

Therefore in the above case De roller has voluntary promise the creditors to pay debts on his behalf therefore this oral contract is valid and enforceable in the eyes of law.

Answer 3 :-

The Essential elements of a valid contract are :-

1) it is not a legal in the eyes of law .

2 ) it is for a valid consideration .

3 ) it is an voluntary agreement between the parties.

4).It can be enforced under the provisions of law.

In the above case Bain and Carol have voluntary entered into an agreement of selling the land in lieu of $10,000 which is a valid consideration .In addition to this Bain had already accepted partial payment of the contract. Thus the above contract is completely valid and enforceable in the eyes of law ,therefore Carol will succeed in the suit

Answer 4 :-

Verbal employment contracts are well recognised in the eyes of law and are valid and enforceable. As soon as one party makes the offer and the other one accept offer, the contract becomes enforceable as well as binding on both the employer and employee .Thus oral agreement between Martin and Stein is enforceable in the eyes of law.