Legal Definitions - preexisting-duty rule

The preexisting-duty rule is a principle in contract law that addresses situations where one party promises to do something they are already legally obligated to do. Under this rule, performing an existing legal duty, or promising to do so, does not constitute new "consideration" for a new promise made by the other party. For a contract or a modification to an existing contract to be legally enforceable, both parties must exchange something of new value, known as consideration. If a party merely promises to fulfill an obligation they already owe, they are not providing new consideration, and any new promise made to them in exchange for that existing duty will generally not be legally binding.

Here are some examples illustrating the preexisting-duty rule:

• Scenario: Construction Project Modification

  Imagine a homeowner hires a contractor to build a new deck for a fixed price of $10,000. Halfway through the project, the contractor informs the homeowner that they underestimated the costs and will only complete the deck if the homeowner agrees to pay an additional $2,000. The homeowner, wanting the deck finished, reluctantly agrees to the extra payment.

  Explanation: In this situation, the contractor was already legally obligated by the original contract to build the deck for $10,000. When they demanded an additional $2,000, they were not offering any new work or value beyond what they were already contracted to do. Therefore, the homeowner's new promise to pay the extra $2,000 lacks new consideration from the contractor. Under the preexisting-duty rule, this new promise from the homeowner would likely not be enforceable, meaning the homeowner would not be legally required to pay the additional $2,000.

• Scenario: Public Service Reward

  Consider a local fire department responding to a house fire. The homeowner, grateful and desperate to save their family heirlooms, offers the firefighters a $1,000 reward if they successfully retrieve the items from the burning house. The firefighters agree and manage to save the heirlooms.

  Explanation: Firefighters have a preexisting legal duty to respond to emergencies and protect lives and property as part of their public service. When the firefighters agreed to the homeowner's offer, they were not undertaking any new obligation beyond what their job already required. Because the firefighters did not provide new consideration (they were already obligated to perform the duty), the homeowner's promise to pay the $1,000 reward would not be enforceable under the preexisting-duty rule.

• Scenario: Employee Bonus for Existing Work

  A marketing manager is employed by a company under a contract that outlines their salary and responsibilities, which include developing and executing marketing campaigns. During a critical product launch, the manager tells their director that they will only work the necessary extra hours to ensure the campaign's success if the company promises them a $5,000 bonus. The director, under pressure, agrees.

  Explanation: The marketing manager's existing employment contract already obligates them to develop and execute marketing campaigns, which often includes working necessary hours to achieve success. When the manager demanded a bonus for working extra hours on a critical campaign, they were not offering to do anything beyond their existing contractual obligations. Therefore, the director's promise of a $5,000 bonus lacks new consideration from the manager. According to the preexisting-duty rule, this promise of a bonus would likely not be legally enforceable, as the manager was already obligated to perform that work.