As a general matter, a contract is not enforceable unless it is supported by valid consideration. Not surprisingly the issue of consideration arises in two general types of scenarios: when two parties are considering entering into a contract and when one of the parties is trying to get out of obligations: one party argues that there is a binding contract, while the other argues that there is no binding contract, due to a lack of consideration.

You are the Chief Contact Risk Manager of Turbines, Inc.. a manufacturer which enters thousands of contracts each yeare.g., contracts with suppliers, customers, employees, and lenders.

Questions

The board of directors has asked you to:

• Identify three factual contexts (scenarios) in which the issue of consideration is likely to play an important role
• Explain why you chose those three scenarios
• Describe at least one policy and procedure to assure that the company's agreements have valid consideration