READJUSTING DEBT AND WRITING CONTRACTS

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No. It can be almost anything, even just promises made by each party. "I promise to teach you to play chess if you promise to teach me how to play the piano" contains the element of consideration necessary to create a contract.

What things cannot be regarded as consideration?

There are three major types of quid pro quo-the legal term for "something in return for something"—that the law does not look upon as consideration.

1. An illegal quid pro quo. If your brother-in-law promises you a percentage of the take if you promise to stash his marijuana, there's no consideration.

2. A quid pro quo arising out of moral obligation. If you promise to do something for your brother-in-law because he's done something for you for nothing, like taking your kids to the ball game, there's no consideration.

3. A quid pro quo involving the payment of a debt to a third party without receiving some benefit from that party. If your brother-in-law promises to repair your plumbing in return for your paying off part of his debt to the finance company, and you gain in no way from the finance company, there's no consideration.

My brother-in-law agreed to repair my plumbing for nothing. A few weeks after he finished the job, he asked for X dollars for his work. l say I don't have to pay. He says I do. Who's right?

You are. Consideration must be created at the same time a contract is made—not after and not before. Without consideration in this instance, you have no contract and you don't have to pay.

Creating a Contract

Not all contracts must be in writing. But putting it in writing helps prevent misunderstandings. Also keep in mind that there are some kinds of contracts that are not valid unless they are in writing. These vary from state to state; so when in doubt, put it in writing.

An easy way to create a contract is to put it in the form of a business letter. Prepare it in duplicate.

There are six elements to a contract and they must all be present in the letter if it is to be considered valid.

1. A definite offer:

Dear George:

I want you to inspect the plumbing in my house, located at the address on this letter, and make the necessary repairs. l wantthis work to be completed in 10 businessdays, commencing on May 17th of thisyear,during the hours from 10A.M.to4P .M.

2. Consideration:

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