This is due to a lack of mutuality or indefiniteness where only one party is bound to perform. An illusory promise is based on deception or parameters that are indefinite, making it unclear what must be done or if performance is optional.
Courts may enforce an illusory promise as being a valid contract by invoking the doctrine of promissory estoppel. The doctrine comes into play when a promise is made to a promisee who relies on the promise to his or her detriment.
The seller's use of the word "may" allows them to perform or not perform, meaning they may or may not sell you the item. This type of promise is illusory .
It is not uncommon for illusory contracts to be created due to misunderstandings and errors by laypeople creating contracts. However, it is possible for someone to deliberately create a vague contract regarding their performance with the intention of defrauding the other party.
Because the agreement does not clearly outline the performance required by one party and appears to bind the other only to pay or perform , the agreement is unenforceable in a court of law. An example would be a situation where one person states that he or she "may" sell you an item if you pay a specified amount of money.
In this case, the promisor has no actual obligation clearly stated. The language used in this type of agreement makes it unclear whether the promising party must perform due to the lack of clarity in the language used. Even if the party is compensated, the language does not make that clear.
Courts generally follow the premise that the parties involved in creating a contract had the intention of making it valid. Because of this, courts lean toward not interpreting contracts as illusory promises. If you need help with illusory promises, you can post your legal need on UpCounsel's marketplace.
A contract containing a statement that gives the person making a promise no actual obligation to fulfill the promise is considered an “illusory promise,” or “illusory contract.”. The language in this type of agreement is indefinite and unclear, making it uncertain whether the promising party must perform even if paid or compensated by ...
In contract disputes, the courts generally take into consideration the parties intent when creating a contract. For instance, if the parties obviously had the intent of creating an enforceable contract, but failed to be specific enough in the language, the court may consider what exactly the parties were attempting to accomplish through the agreement. Even with a lack of specific language, a promise made that is within the party’s ability to provide is not considered illusory if it can be shown that he made a reasonable effort to fulfill the promise. Parties are also required to use good faith and honest judgment in determining whether a contractual promise has been fulfilled.
Once again, the court is likely to take into account the intent of both parties in entering into the contract. A party making an illusory promise for the specific purpose of fraudulently harming the other party may be held liable for bad faith principles that apply to every contract made, or even for criminal fraud.
Obligation, Performance, and Consideration. In order for a contract to be enforceable it must contain mutual obligations to perform, and valid consideration, or something of value, provided. In other words, all parties must be bound to perform something in the contract, and there must be something of value offered in return.
A valid contract contains a promise from one party to perform specific services, or to provide specific goods, and for the other party to pay specific sums or provide other consideration in return. An illusory contract, whether written or oral, contains only the illusion of a contract or promise. For example, Bob and Sam enter into a contract ...