Angel v. Murray
Encyclopedia
Angel v. Murray, 322 A.2d 630 (RI 1974), was a case decided by the Rhode Island Supreme Court
that first accepted the rule articulated in the Uniform Commercial Code
§2-209(1) and the Restatement Second of Contracts §89(a) that the modification of a contract
does not require its own consideration
if the modification was made in good faith
and was voluntarily accepted by both parties.
to collect all of the waste in the city for $137,000 per year for five years beginning in 1964. In 1967 Maher requested an additional $10,000 per year for refuse collection because of an unexpected increase in the number of dwellings in the city. Maher's request was approved, and a similar request the next year was also approved. The trial judge invalidated the extra payments because the modification of the contract was made without consideration.
Applying the criteria of the Restatement to the present case, the court found that the unexpected increase of dwellings in the city (400 in a year as opposed to the usual 20-25) was unanticipated, that Murray had not yet completely performed his five year contract, and that the additional $10,000 was a fair price for the additional services. The court accordingly upheld the contract.
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Rhode Island Supreme Court
The Rhode Island Supreme Court, founded in 1747, is the court of last resort in the U.S. State of Rhode Island and Providence Plantations. The Court consists of a chief justice and four associate justices. The current Justices of the Rhode Island Supreme Court are:*Chief Justice Paul A...
that first accepted the rule articulated in the Uniform Commercial Code
Uniform Commercial Code
The Uniform Commercial Code , first published in 1952, is one of a number of uniform acts that have been promulgated in conjunction with efforts to harmonize the law of sales and other commercial transactions in all 50 states within the United States of America.The goal of harmonizing state law is...
§2-209(1) and the Restatement Second of Contracts §89(a) that the modification of a contract
Contract
A contract is an agreement entered into by two parties or more with the intention of creating a legal obligation, which may have elements in writing. Contracts can be made orally. The remedy for breach of contract can be "damages" or compensation of money. In equity, the remedy can be specific...
does not require its own consideration
Consideration
Consideration is the central concept in the common law of contracts and is required, in most cases, for a contract to be enforceable. Consideration is the price one pays for another's promise. It can take a number of forms: money, property, a promise, the doing of an act, or even refraining from...
if the modification was made in good faith
Good faith
In philosophy, the concept of Good faith—Latin bona fides “good faith”, bona fide “in good faith”—denotes sincere, honest intention or belief, regardless of the outcome of an action; the opposed concepts are bad faith, mala fides and perfidy...
and was voluntarily accepted by both parties.
Factual background
James Maher had contracted with the city of NewportNewport, Rhode Island
Newport is a city on Aquidneck Island in Newport County, Rhode Island, United States, about south of Providence. Known as a New England summer resort and for the famous Newport Mansions, it is the home of Salve Regina University and Naval Station Newport which houses the United States Naval War...
to collect all of the waste in the city for $137,000 per year for five years beginning in 1964. In 1967 Maher requested an additional $10,000 per year for refuse collection because of an unexpected increase in the number of dwellings in the city. Maher's request was approved, and a similar request the next year was also approved. The trial judge invalidated the extra payments because the modification of the contract was made without consideration.
Decision
The Supreme Court of Rhode Island upheld the contract, finding persuasive the reasoning behind the provision in the Universal Commercial Code that allowed for modification of contracts without consideration if the modifications were made in good faith and were voluntarily accepted by both parties. Because the UCC applies only to transactions involving goods, and the present case involved a contract for services, the Court had to look elsewhere. To determine if the modification met the standard of good faith, the Court looked to §89D(a) of the Restatement Second of Contracts. The criteria of §89(a) are:- The modification was made before the contract was fully performed by either side
- The circumstances prompting the modification were unanticipated by the parties
- The modification is fair and equitable
Applying the criteria of the Restatement to the present case, the court found that the unexpected increase of dwellings in the city (400 in a year as opposed to the usual 20-25) was unanticipated, that Murray had not yet completely performed his five year contract, and that the additional $10,000 was a fair price for the additional services. The court accordingly upheld the contract.
Impact
Angel v. Murray presents an exception to the pre-existing duty rule that would have normally required Maher to collect all of the refuse for the same pay. The case is an example of the somewhat amorphous "unanticipated circumstances" exception to the pre-existing duty rule when courts will often invalidate contract modifications based on economic duressDuress
In jurisprudence, duress or coercion refers to a situation whereby a person performs an act as a result of violence, threat or other pressure against the person. Black's Law Dictionary defines duress as "any unlawful threat or coercion used... to induce another to act [or not act] in a manner...
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