Cut-Rate Construction Company (CCC) begins building a restaurant for Diners Restaurants, Inc., but after two months demands an extra $100,000. Diners agrees to pay.
-Refer to Fact Pattern 11-3.If CCC offers no reason for the extra $100,000,but says only that it will otherwise stop construction,the agreement is

Question

Quizplus · Accepted Answer

This scenario falls under the preexisting duty rule, which means that CCC was already contractually obligated to complete the construction of the restaurant for the agreed-upon price. Asking for an additional $100,000 without providing any reason or justification is not valid consideration for a new contract, and Diners Restaurants, Inc. would not be legally obligated to pay the extra amount.

Cut-Rate Construction Company (CCC) Begins Building a Restaurant for Diners