Option Contracts and Conditional Consideration
Generally, conditional consideration is valid consideration.
Suppose A is a movie script writer and B runs a movie production company. A says to B, "buy my script." B says "How about this – I will pay you $5,000 so that you do not let anyone else produce your movie until one year from now. If I do produce your movie in that year, then I will give you another $50,000, and no one else can produce it. If I do not produce your movie in that year, then you're free to go." If the two subsequently get into a dispute, the issue of whether a contract exists is answered. B had an option contract—he could decide to produce the script, or not. B's consideration passed was the $5,000 down, and the possibility of $50,000. A's consideration passed was the exclusive rights to the movie script for at least one year.
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Famous quotes containing the words option, contracts and/or conditional:
“A self-respecting nation is ready for anything, including war, except for a renunciation of its option to make war.”
—Simone Weil (1909–1943)
“Bankers, nepotists, contracts and talkies: on four fingers one may count the leeches which have sucked a young and vigorous industry into paresis.”
—Dalton Trumbo (1905–1976)
“Conditional love is love that is turned off and on....Some parents only show their love after a child has done something that pleases them. “I love you, honey, for cleaning your room!” Children who think they need to earn love become people pleasers, or perfectionists. Those who are raised on conditional love never really feel loved.”
—Louise Hart (20th century)