Factual Situation: MXM Co. is a building contractor who entered into an agreement with Star Heights Housing Association to refurbish a block of 27 flats. This contract was subject to a liquidated damages clause if they did not complete the contract on time. The MXM Co. engaged Hasan to do the carpentry work for an agreed price of ` 20,000. After six months of commencing the work, Hasan realised he had priced the job too low and would be unable to complete at the originally agreed price. He approached MXM Co. who recognised that the price was particularly low and was concerned about completing the contract on time. MXM Co. agreed to make additional payments to Hasan in return for his promise to carry out his existing obligations. MXM Co. agreed to pay Hasan an additional ` 575 per flat. Hasan continued work on the flats for a further period of 6 weeks but only received an additional ` 5,000. He then ran out of money and refused to continue unless payment was made. MXM Co. engaged another carpenter to complete the contract and refused to pay Hasan any further sums. Hasan sued for payment under the original agreement and the subsequent agreement. MXM Co. argued that the agreement to make additional payments was unenforceable as Hasan has not provided any consideration to make this agreement a valid contract. Decide. (AILET 2018)

🎲 Try a Random Question  |  Total Questions in Quiz: 566  |  🧠 Study this quiz with Flashcards
This question is part of a full practice quiz:
Legal Aptitude Test — practice the complete quiz, review flashcards, or try a random question.

Each question consists of legal principle(s) (hereinafter referred to as 'principle') and facts. Such proposition may or may not be true in the real and legal sense, yet you have to conclusively assume them to be true for the purposes of this section. You have to apply the principles to the given facts to arrive at the most reasonable conclusion. Only one of the alternatives, i.e., (A), (B), (C), or (D) is the most reasonable conclusion. Remember: you must not rely on any principle except the principles that are given for every question.

Factual Situation: MXM Co. is a building contractor who entered into an agreement with Star Heights Housing Association to refurbish a block of 27 flats. This contract was subject to a liquidated damages clause if they did not complete the contract on time. The MXM Co. engaged Hasan to do the carpentry work for an agreed price of ` 20,000. After six months of commencing the work, Hasan realised he had priced the job too low and would be unable to complete at the originally agreed price. He approached MXM Co. who recognised that the price was particularly low and was concerned about completing the contract on time. MXM Co. agreed to make additional payments to Hasan in return for his promise to carry out his existing obligations. MXM Co. agreed to pay Hasan an additional ` 575 per flat. Hasan continued work on the flats for a further period of 6 weeks but only received an additional ` 5,000. He then ran out of money and refused to continue unless payment was made. MXM Co. engaged another carpenter to complete the contract and refused to pay Hasan any further sums. Hasan sued for payment under the original agreement and the subsequent agreement. MXM Co. argued that the agreement to make additional payments was unenforceable as Hasan has not provided any consideration to make this agreement a valid contract. Decide. (AILET 2018)