Pre-Existing Duty Rule

Definition

The pre-existing duty rule is a principle in contract law that states that a promise to perform an existing legal duty is not sufficient consideration to form a valid contract. In other words, a party cannot claim additional compensation for doing something they are already legally obligated to do.

5 Must Know Facts For Your Next Test

1. The pre-existing duty rule applies when a party promises to do something they are already legally obligated to do, such as fulfilling an existing contract.
2. For a contract to be valid, the consideration provided by each party must be something new, not just the performance of a pre-existing duty.
3. The pre-existing duty rule is an exception to the general rule that any consideration, no matter how small, is sufficient to support a contract.
4. The pre-existing duty rule helps prevent parties from coercing additional compensation by threatening to withhold performance of an existing obligation.
5. Promissory estoppel may be used to enforce a promise even in the absence of consideration, if the promisor should have reasonably expected the promise to induce action or forbearance by the promisee.

Review Questions

• Explain how the pre-existing duty rule relates to the concept of consideration in contract law.
  • The pre-existing duty rule states that a promise to perform an existing legal obligation is not sufficient consideration to form a valid contract. This is because consideration requires each party to provide something new or additional, not just the fulfillment of a pre-existing duty. The pre-existing duty rule helps ensure that contracts are formed based on a genuine exchange of value, rather than a party simply agreeing to do what they are already legally required to do.
• Describe how the pre-existing duty rule may interact with the doctrine of promissory estoppel.
  • While the pre-existing duty rule generally requires that consideration be something new, the doctrine of promissory estoppel may be used to enforce a promise even in the absence of consideration. Promissory estoppel allows a promise to be enforced if the promisor should have reasonably expected the promise to induce action or forbearance by the promisee. In such cases, the pre-existing duty rule may be overcome, and the promise may be enforceable under the principles of promissory estoppel, even if it does not meet the traditional requirements of consideration.
• Analyze how the pre-existing duty rule supports the overall purpose and structure of contract law.
  • The pre-existing duty rule is a fundamental principle in contract law that helps maintain the integrity and fairness of contractual agreements. By requiring that consideration be something new and not just the fulfillment of a pre-existing duty, the pre-existing duty rule ensures that contracts are formed based on a genuine exchange of value between the parties. This supports the overarching purpose of contract law, which is to facilitate and enforce voluntary, mutually beneficial transactions. The pre-existing duty rule also helps prevent parties from coercing additional compensation by threatening to withhold performance of an existing obligation, thereby upholding the principles of good faith and fair dealing that are central to contract law.

Related terms

Consideration: Something of value that is exchanged between the parties to a contract, which is necessary to form a valid contract.

Promissory Estoppel: A doctrine that allows a promise to be enforced even in the absence of consideration, if the promisor should have reasonably expected the promise to induce action or forbearance by the promisee.

Agreement: The mutual assent of two or more parties to the same terms, which is a required element for the formation of a valid contract.