Contracts

Shewhomustbe...

An individual signs a contract, then at a future date signs another contract which contradicts the original contract.
Is the first or either contract legal?

Kappar

In what way contradict

dermot_sheehan

Shewhomustbe... wrote:

An individual signs a contract, then at a future date signs another contract which contradicts the original contract.
Is the first or either contract legal?

This is confusing, sign a contract with the same person the contradicts.


For example A signs contract with B

Later on

A signs a new contract with B that contradicts the first contract,

in this case it could be taken the parties mutually agreed to amend the terms of the first contract.

But however:

A signs Contract with B

A later signs contradicting contract with C

In this case A is potentially in breach of contract with regard to either B or C depending which contract he choses to honour. The second contract couldn't have amended the terms of the first one since B wasn't a party to it.

Shewhomustbe...

First contract states X amount is a loan.
Second contract (mortgage) states X amount is a gift.

besty

Shewhomustbe... wrote:

First contract states X amount is a loan.
Second contract (mortgage) states X amount is a gift.

I presume this is a hypothetical situation and you're not looking for advice.

Sangre

You can't have a contract for a gift because a gift implies no consideration.
A contract needs consideration.

Shewhomustbe...

besty, yes it is hypothetical.

It's based on a discussion with some friends I was having about parents lending their kids deposits for their own homes and if they, for peace of mind, signed an agreement (contract one) regarding repayment of said loan etc but then on the child's mortgage (contract two) signed stating that the money was a gift which one is actually legal and is contract one enforceable should the child stop making repayments.

Victor

Sangre wrote:

You can't have a contract for a gift because a gift implies no consideration. A contract needs consideration.

Some gifts will need a contract or something very similar, e.g. a gift of land or a gift of an original artwork.

hullaballoo

Victor wrote:

Some gifts will need a contract or something very similar, e.g. a gift of land or a gift of an original artwork.

There still needs to be consideration though, even if it's just nominal (eg €1 for 800 acres of land, or Van Gogh's "Sunflowers").

dermot_sheehan

Victor wrote:

Some gifts will need a contract or something very similar, e.g. a gift of land or a gift of an original artwork.

As far as I know it's possible to transfer land by deed without a contract. All that the statute of frauds requires is that it be made or evidenced in writing, a deed of conveyance without consideration would be sufficient and wouldn't be a contract since there was no consideration.

Victor

gabhain7 wrote:

As far as I know it's possible to transfer land by deed without a contract.

Hence I used the phrase

Victor wrote:

a contract or something very similar

If I made an agreement that the National Gallery can have my picture "Lighthouse" on condition that it did not charge admission to view it, contract or deed?

Shewhomustbe...

I am now completely confused

hullaballoo

Welcome to the world of the Law of Contracts!

If A signs a contract with B and later re-negotiates, then that's ok, because both parties agree - mutual consent.

If A signs a contract with B and then, later, a contract that's incompatible with A&B's contract with C, then I would say that both contracts are enforceable against A. In practice then, A would have to compensate either or both parties financially.

An example would be if A agrees to sell B his car for €2,000 and then later realises that he needs a car because his wife was pregnant. If he can get B to sign up to a contract to sell the car to B for €1000 and B's car in part-exchange, then they have renegotiated and formed a new contract, which voids the first one.

If A then meets C who offers €2000 plus his car in part-exchange and A agrees, then A may have to try to satisfy both contracts.

Edit: No, that doesn't really help, does it?!

Shewhomustbe...

I kind of get what you are saying, but I'll return to my original example if I may.

Contract 1, is signed by A (parents) and B (child) stating that X amount is a loan.
Contract 2 (mortgage), is signed by B (child), but also requires that A (parents) sign to state that X amount was in fact a gift.

My understanding is that banks, building societies etc are including this in the mortgage contract to cover themselves so that should anything happen and the house gets repossessed they get their money first, and this is where I get confused as to is Contract 1 still enforceable under the original terms.