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Mutuality of Consideration

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Contracts
MEMORANDUM
Date
To:
From: – Paralegal Student
Subject: Mutuality of Consideration
Summary of Facts Bernie is selling his 2006 ford Fusion. Vivian makes an offer to purchase the vehicle for $12,000. Bernie and Vivian meet and negotiate a selling price of $12,500. Vivian has requested an additional three weeks to obtain the funds to purchase the vehicle. Bernie agrees to the extension of time but requires a deposit of $1,000. Vivian agrees to the terms. Bernie drafts an agreement which contains the purchase price, the deposit terms and the transaction deadline date. The contract also contains breach clauses for each party. Shall Bernie breach, he shall be required to return the deposit with no other remedy. If Vivian breaches, she forfeits the deposit with no other remedy. Vivian signs the agreement and provides the $1,000 deposit to Bernie. Two weeks later, Vivian is unable to obtain the additional funds to purchase the vehicle and informs Bernie that she is withdrawing from the agreement. Bernie retains the deposit in accordance with the signed agreement. Vivian sues Bernie for the return of the deposit on the grounds that there is no mutuality of consideration and the agreement is void.
Issues Presented The issue in this case is whether there is mutuality of consideration.
Applicable Law Busman v. Beeren & Barry Invs., LLC, 69 Va. Cir. 375 (Va. Cir. Ct. 2005), in determining if mutuality of consideration exists states:
“[m]utuality of contract as now commonly understood should properly be taken to be sufficiently complied with when there are promises on each side that something shall be done for the benefit of the other side furnishing therefor considerations by each party, although they may relate to different terms of the contract and may be conditioned upon performance by the other party. In plainer language,

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