Contract question

fliptzer

From my understanding a valid contract has to have some financial implication or money exchanging hands.

Hypothetically is a contract still valid if money does not exchange hands even though as a term of the contract one party acknowledges receipt of said money which never actually happened.

Basically you’re signing for receipt of money you never received. This sounds a bit crazy but is it legal/valid?

Tom Young

Offer + Acceptance = Agreement;
Agreement + Consideration (money or good etc.) = Legally Enforceable Contract.

dermot_sheehan

a contract (not under seal, deeds are enforceable absent consideration) is enforceable if something of value eminates from the person seeking to enforce.

fliptzer

Thanks for you replies but I’m still not sure…

Below is a sample (not an original) term I am confused about. I’ve seen a lot of similar types in agreements for applying for TV programmes based on real life people where only 1 person would win/get money or get a job from the process while the others walk away empty-handed (no financial gain). Terms and conditions of application are similar to this …

Term x of y :In consideration of the sum of €2 (two euro) (the receipt of which you acknowledge) you hereby with full title guarantee irrevocably assign to the TV Company by way of an assignment of present and future copyright, the entire copyright and all other rights, etc. etc.

Note: I accept that if €2 was handed over it is a legal contract and you have sold off all your interest in the copyright for the measly sum of €2. However at the time of agreeing to such terms, via online website the €2 is not handed over, no money is exchanged yet you have receipted said money, which is factually incorrect, and all the terms are applied from that point onwards

Does that not make the contract invalid?

Rhonda9000

Hmmm, interesting.

The consideration must pass from the promisee. This would seem to militate against valid consideration here.

On the other hand, a receipt under seal is conclusive acknowledgment of payment whereas a receipt under hand is prima facie evidence of same which can be rebutted. So this make-belief €2 consideration would be valid with a receipt under seal.

fliptzer

Thank you for replying.

I find this particular one quite fascinating and would love to hear views.

1. A real contract such as this would typically refer to consideration numerous times, effectively pointing out that it existed and is accepted by your application to the TV programme. There is no real or mutual consideration, the producers would get a participant while the participant would only receive financial gain if he/she won the show which probably would not happen so the probability of a participant actually getting anything of value is slim. Participation in a TV show might be exciting/enjoyable I don’t think it could be classed as consideration – I could be wrong.

2. Another idea I had was that one could argue that at the time of acceptance of such terms and conditions that one genuinely expected the €2 immediately (or within a very short amount of time) as you were acknowledging receipt for it on the assumption it would be given - non receipt of money invalidates the contract.

3. Not sure about contract under seal….so here goes…

A contract under seal is conclusive acknowledgement of payment but the term in this contract brings into the question the intention of both parties. Both parties must wish to create and fulfil an honest and factually correct contract, the alternative is that parties wished to created an unhonest (as in factually incorrect contract) which goes against the every essence or reasoning of contractual law thereby invalidating it.

In other words one party (TV producers) knowingly inserted a term that they have no intention of fulfilling which is either a mistake or a misrepresentation (arguable fraudulent) to deny the second party (participant) all rights of royalties and loss of future earnings
Does that sound like a valid arguement?.

I would really appreciate any suggestions/view on my arguments or pointers as to where I’m going wrong.

Thanks.

Tom Young

Sounds like an exemption clause or a warranty.

Rhonda9000

fliptzer wrote: »

1. A real contract such as this would typically refer to consideration numerous times, effectively pointing out that it existed and is accepted by your application to the TV programme. There is no real or mutual consideration, the producers would get a participant while the participant would only receive financial gain if he/she won the show which probably would not happen so the probability of a participant actually getting anything of value is slim. Participation in a TV show might be exciting/enjoyable I don’t think it could be classed as consideration – I could be wrong.

In relation to this, the plaintiff in O'Keefe v. Ryanair engaged in publicity for the defendant - and this was held to be valuable consideration. I imagine that partaking in a TV game show could thus be analogous enough to be valuable consideration.