What is an illusory promise in the restatement of contracts?
Asked by: Jarrell Hane | Last update: March 2, 2025Score: 4.2/5 (35 votes)
Illusory promises. Words of promise which by their terms make performance entirely optional with the “promisor” do not constitute a promise.
What is an illusory promise in contracts?
An illusory promise is a promise that is unenforceable due to indefiniteness or lack of mutuality , where only one side is bound to perform.
What is an illusory promise Restatement 77?
Restatement § 77. An illusory promise may exist where a promise is subject to a condition which is within the control of the promisor, especially where such condition is related to the contract performance, or when the promisor, at the time of the promise is made, knows that such condition cannot occur.
Which of the following is an example of an illusory promise?
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 is an example of illusory consideration?
It is a contract that lacks consideration, which means that one party is not obligated to do anything. Therefore, the contract is not enforceable by law. For example, if a company offers a job to an employee but reserves the right to terminate the employment at any time without cause, the contract is illusory.
What is an illusory promise?
Why does an illusory promise not count as consideration?
Because an illusory promise forms a contract in which only one party is required to perform, an illusory promise is not valid consideration and neither party to a contract containing an illusory promise is bound by the contract.
What is an example of illusory?
The auction prices and the professorships and even the art hanging on the wall by now seemed illusory. The concept of money might be the greatest illusory trick of all time.
What is the difference between illusory promises and valid offers?
Such contracts can work as initial agreements but will not be enforced by a court as legally binding. On the flip side, an illusory promise is an ambiguous oral promise that imposes no clear obligations on parties. They can appear in the negotiation process when parties seek more flexibility.
How is an illusory promise different from a unilateral contract?
The difference between a unilateral contract and an illusory promise is that when a bilateral contract has an illusory promise in it, one party is bound by his promise while the other party has made an empty promise which does not bind him.
What is the doctrine of mutuality and the illusory promise rule?
However, the general rule is that unless both parties to a contract are bound to perform, neither party is bound. [1] That is, there must be mutuality of consideration or the contract is unenforceable for lack of consideration. A contract is “illusory,” and thus unenforceable, when only a single party is bound by it.
What is an illusory statement?
(also illusive, uk/ɪˈluː.sɪv/ us/ɪˈluː.sɪv/) not real and based on illusion: Their hopes of a peaceful solution turned out to be illusory. SMART Vocabulary: related words and phrases. True, real, false, and unreal.
What is a promise in the restatement of contracts?
The current edition of the Restatement provides: “A promise is a manifestation of intention to act or refrain from acting in a specified way, so made as to justify a promisee in understanding that a commitment has been made.” Restatement (Second) of Contracts § 2(1) (1981), cited in Hansen, 113 Wn. App.
What does consideration must be real and not illusory mean?
Consideration Must be Real and Not Illusory
It cannot be vague, uncertain, or impossible. The transaction is rendered void in such a case. As an example, if A promises to find a treasure by magic if B pays him Rs. 10,000, then this is an illusory consideration and not considered valid.
What are illusory and alternative promises 77?
77 – Illusory or Alternative Promises
(b) one of the alternative performances would have been consideration and there is or appears to the parties to be a substantial possibility that before the promisor exercises his choice events may eliminate the alternatives which would not have been consideration.
What are the requirements for an illusory contract?
How do courts determine if a contract is illusory? Courts examine the language of the contract, the intentions of the parties, and whether there is mutual consideration. If one party's promise is found to be too vague or discretionary, the court may deem the contract illusory and unenforceable.
What is an example of a promise in a contract?
Grody is the promisor because he promised to send Mongo to dance at the party. Misty is the promisee because she is on the benefiting end of the promise. That is the simplified explanation of how two parties become obligated to one another.
What is an example of an illusory promise?
One example of an illusory promise is an agreement between a seller and a buyer that states that the seller "agrees to sell all of the ice cream he wants to" to the buyer. This promise is too vague and does not specify how much ice cream the seller will actually sell to the buyer.
Is an illusory promise enforceable?
An illusory promise is something within a contract that a court will not enforce. Understanding when a promise is illusory or not is very important to parties within a contract.
Why does an illusory contract lack consideration?
An illusory contract lacks consideration because it does not involve a genuine exchange of value or obligatory performance. This can occur if promises are already obligatory, involve past compensation, or lack enforceability. Therefore, such contracts are generally void in law.
When a promise is illusory there is no mutuality of obligation?
Illusory Promise: A promise that does not impose any real obligation on the promisor, rendering it unenforceable due to a lack of mutuality. Consideration: Something of value exchanged between parties in a contract, necessary for establishing mutual obligations and enforceability.
Do illusory promises require both parties to perform their contractual obligations?
Illusory promises require both parties to perform their contractual obligations. Illusory promises are enforceable if one of the parties has performed their contractual obligation. An illusory promise is an example of a contract that lacks consideration.
What does illusory mean in law?
illusory adj
: likely to mislead or deceive. : false deceptive [an plea bargain leading to a longer sentence than expected]
What is a real life example of illusory correlation?
Gambling can be an example of illusory correlation. An illusory correlation could occur in gambling if someone wore special socks to the casino and won a lot. They might assume their socks were lucky socks, when in fact it was only a matter of chance.
What is a good example of illusion?
Perhaps the best real-life example of a perceptual illusion is the Moon illusion. When the Moon is at the horizon, it appears to be much larger than it does when it is high in the sky. Yet when the Moon is photographed at various points across the sky, all the images on the negatives are the same size.