Contract Law: Understanding Consideration in Business Contracts
What does the sentence in this business contract indicate regarding the school's promise to provide something of value in exchange for the architect's services?
Which sentence in this business contract shows that the school has promised to give the architect something of value in exchange for his or her services?
A. The school has made an offer to the architect to provide services in connection with the design of the school’s science laboratory.
B. This contract shall be effective as of December 10, 2015, and shall continue for 12 months.
C. The architect may seek permission from the school’s management committee to extend the term.
D. The architect promises not to disclose or provide any services in any manner to any competitor of the school during the duration of this contract.
E. The school shall pay to the architect a sum of $85,000 for services offered to the school under this contract.
F. For the architect to perform the services without hindrance, the school may provide the architect with confidential data regarding the school’s plans.
Answer:
The correct sentence in this business contract that indicates the school's promise to provide something of value in exchange for the architect's services is: E. The school shall pay to the architect a sum of $85,000 for services offered to the school under this contract.
In the contract law between the school and the architect, the sentence that represents the school's promise to provide something of value in exchange for the architect's services is the statement about the school agreeing to pay $85,000 for the architect's services.
This sentence demonstrates the concept of consideration in contract law. Consideration is the exchange of something of value by the parties to a contract. It can be in the form of money, goods, services, or other benefits.
By agreeing to pay the architect $85,000 for the services rendered, the school is fulfilling its promise to provide something of value in return for the architect's services. This payment serves as the consideration that makes the contract legally binding.
Understanding the importance of consideration is essential in contract law as it ensures that both parties are giving and receiving something of value in their agreement. It helps to create a fair and balanced contractual relationship.
Overall, the sentence indicating the school's promise to pay the architect for the services offered exemplifies the crucial element of consideration in business contracts.