Question

In: Accounting

Sarah’s house caught on fire. Through the prompt assistance of her neighbor Odessa, the fire was...

  1. Sarah’s house caught on fire. Through the prompt assistance of her neighbor Odessa, the fire was quickly extinguished. In gratitude, Sarah promised to pay Odessa, $1000. Using IRAC determine whether Odessa enforce this promise?

Solutions

Expert Solution

To enforce this promise we need to analyse whether there has been any agreement or contract between Sarah and Odessa and whether the same can be enforced

In this case, the offer by Sarah to pay the neighbor for assisting in extinguishing the fire is not an enforceable contract. When the neighbor rushed to help in the fire, the offer to pay $1,000 had not been established. When Sarah offered to pay $1, 000, there was no consideration exchanged between both the parties. The event of putting off the fire had already occurred without the offer or acceptance of a contract.

Consider the alternate scenario, Sarah's house was on fire, and she could not wait for the fire department. She ran to her neighbor's house, asked for help and offered to pay $1,000 as consideration for neighbour's assistance, and the same had been accepted by the neighbour. This constitutes an offer, consideration and acceptance


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