A small business owner enters into a contract with a marketing firm for a six-month advertising campaign. The contract states that the marketing firm will provide 'such services as the owner may request from time to time.' The owner pays the first month's fee but then, after realizing the vague nature of the services, decides not to request any further services. The marketing firm sues for the remaining five months' fees. What is the most likely defense for the business owner?
- ALack of consideration, because the marketing firm's promise was illusory.
- BBreach of contract by the marketing firm for failing to provide specific services.
- CMutual mistake, as both parties misunderstood the scope of services.
- DImpossibility of performance, as the owner never requested services.
Show answer & explanationAnswer & explanation
Correct answer: A. Lack of consideration, because the marketing firm's promise was illusory.
An illusory promise is one where the promisor retains an unqualified right to decide whether or not to perform, making the promise unenforceable for lack of consideration. Here, the marketing firm's promise to provide 'such services as the owner may request' means they are only obligated to perform if the owner requests, making their promise illusory if the owner is not bound to request anything.
Why the other options are wrong
- B. The marketing firm cannot breach by failing to provide specific services if no specific services were ever requested, which is the core problem of the illusory promise.
- C. There isn't a mistake about an existing fact; rather, the lack of a definite obligation is the issue.
- D. Impossibility relates to external events making performance impossible, not a lack of obligation from the outset.
Illusory Promise
A promise that appears to be a commitment but is not, because the party making it retains an unqualified right to decide whether or not to perform. Such a promise lacks consideration and therefore cannot form a binding contract.
- Lacks mutuality of obligation.
- Often involves terms like 'if I feel like it' or 'as much as I want'.
- Distinguished from conditional promises, where the condition is outside the promisor's control.
Memory trick: Bargained for Exchange: Real or Just Pretend?