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Is there a statute of limitation on a contract with no consideration?

Moreno Valley, CA |

If one side does not give consideration is that contract legal?

Attorney Answers 3


Consideration is a legal term used in contract law. It is difficult to define in concise terms. It is essential to the making of a contract. Without it, there is no contract. Obviously, if you have no contract, it follows that it cannot be enforced.
Contracts are made up of a promise or a set of promises. One party promises to perform some act, such as the repair of a car. The other party promises another act, such as the payment for the repairs of the car. In this contract, the exchange of the promises is the consideration that holds the contract together and makes it enforceable. Very broadly, consideration is what the parties agree to exchange. What one party gives must be bargained for by the other, and the first party must bargain for what the other gives in exchange.
In California, lawyers and the Civil Code talk about failure of consideration. What this means is that one of the parties failed to give the performance that he promised in the contract. Generally, performance or an offer of performance by a party is a condition that must happen before the other party is required to give his performance.
With these ideas in mind, the answer to your question could be one of the following:
1. Since a contract must have consideration to be formed, without consideration a promise is nothing more than a gift. A promise of a gift is unenforceable in most cases.
2. If you have a contract formed with consideration and a party fails to give his consideration, then you have a failure of consideration. While the contract is legal and enforceable, the failure of consideration relieves you of the duty to render your performance, at least temporarily. When it is clear that you will not get the promised performance, then your duty to perform is discharged. You then have the right to sue for your damages, if any.
If you have a contract, there is always a statute of limitations. It is a time limit for filing a lawsuit in court. For an oral contract, the time limit is two years. For a written contract, it is four years. Generally, the statute begins to run from the date of the breach. For example, you borrow $25,000 and promise in writing to pay it back on November 1, 2018. That date rolls around and you fail to pay the money back. You breached on November 1, 2018. The lender has four years from that date to sue you for the money.
Hope this answers your question.

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Generally speaking there must be consideration in order to have a valid contact. And your state no doubt has a statute of limitations which governs contracts. Here in Ohio, for example, the Statute of Limitations on a retail installment sales contract (auto loan, for example) is four (4) years. However, these are defenses to a lawsuit being filed against you in order to enforce the contract. It is not clear from your question if you are being sued. But yes, if you are, these both sound like good defenses to plead in your answer to the lawsuit.

I am not your attorney unless you and I have signed a retainer agreement. What I am saying is not legal advice. Do not act on this information without engaging my services, this is for consideration only.

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You are mixing up two different legal concepts. The lack of consideration is a defense to a claim for breach of contract. If a party wants to file that claim (lawsuit) it must do so within the applicable statute of limitations, which point the defendant can allege lack of consideration as a defense. Whether or not there was consideration given is, ultimately, a question for the court.

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Kevin Samuel Sullivan

Kevin Samuel Sullivan


proving the claim is different from the statute of limitations which determines how long you have to bring a lawsuit.

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