The business Context: a business may enter into a contract that suddenly becomes unfavorable because of changes in the market if it secures a concession from the other side in response to these changes, without regards to legal requirement the concession may prove to be unenforceable.

Factual Background: Gilbert Steel (Gilbert) and university construction (university) were in a contract that required gilbert to supply a set amount of fabricated steel at an agreed upon price. when steel price rose dramatically, gilbert asked university if it would pay more for the steel. university agreed but later refused to pay the increase and sent only the payment for originally agreed upon price. gilbert sued for breach of contract.

The Legal contract: - is there consideration supporting university's promise (i.e what is gilbert doing in return for university promise to pay more for the steel)?

Resolution: - there is no consideration from gilbert for university promise, and it is there- fore unenforceable. gilbert is doing only what is already contractually obliged to do- namely, supply steel to university. put another way, gilbert has a pre existing legal duty to provide steel and, accordingly is giving nothing " extra" to university to support university's promise to pay more. the promises therefore unenforceable, even though university made the second promise in good faith, possibly with a full intention to pay the higher price. gilbert action for the breach of contract therefore fails.

Gilbert should have contemplated arise in the cost of steel when setting the original price and built into the contract a formula permitting an increase in the contract price. alternatively it could have provided something in return for the higher price, such as early delivery or any other benefit that university requested. a final option would have been to get university's promise under seal( see below)

Critical analysis: - does this rule concerning performance of a pre existing legal duty reflect the reasonable expectation of both the parties involved and the border business community?

1. Is there consideration supporting the University's promise?
2. Does this rule concerning performance of a pre-existing legal duty reflect the reasonable expectations of both the parties involved and the broader business community?

Case Study Analysis Template (for use in class discussions) Classification of Law: Parties: Plaintiff: Defendant: Type of Court: Case Facts: Case / Issue (sue for...): Judgment / Decision: Reasons: Remedies