Opinion ID: 2717285
Heading Depth: 3
Heading Rank: 2

Heading: The “agreements” lack consideration

Text: Here, it is not clear as to what was the bargained-for exchange that would support the existence of a contract in the first two agreements.20 The October 6 Document provided that in the event of a separation, Ray would give up half of his interest in the couple’s home worth approximately $1.6 million, plus the contents of the home (except his clothes and tools), plus any interest in the couple’s vehicles. In the MOU, Ray additionally agreed to pay $100,000 in lieu of alimony and court proceedings. Therefore, Ray’s promise in the first two “agreements” is clear; in the event of a divorce or separation, he would relinquish or pay significant property to Sandra. However, it is not clear what constituted Sandra’s return performance or promise. The documents themselves do not recite an exchange of promises. Intuitively, it would seem that Sandra’s return “promise” was forbearance of her right to divorce Ray. However, divorce was not on Sandra’s mind—it is the uncontested findings of the family court that “Sandra was not thinking about a divorce; she took Ray’s signing [of the October 6 Document] as a show of his commitment”; “[t]he parties signed the MOU with the intent that they would work on the marriage”; “Sandra believed Ray signed the Quitclaim Deed 20 The Quitclaim Deed contained its own recitation of consideration. 34 FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER because he was serious about saving the marriage.” (Emphases added). The family court found “that the parties were motivated to save the marriage when they signed the various agreements . . . . Neither party intended their marriage to result in a divorce and to divide their marital estate accordingly.” Even after overhearing Ray say “maybe divorce” to his sister, Sandra still “wanted Ray to work on the marriage[.]” As it is the uncontested findings of the family court that when Sandra signed the first two agreements she did not intend to divorce Ray, Sandra’s return promise could not have been to forbear from acting on her legal right to divorce Ray. At oral argument, counsel for Sandra characterized the consideration for the October 6 “agreement” as the exchange of mutual promises: “You promise to work hard on the marriage, and I promise to work hard on the marriage, and if this thing doesn’t work, this promise for promise, then this is how we’re going to divide our assets.”21 When pressed on the issue of consideration for the subsequent agreements, counsel conceded, “We really didn’t delve into what the consideration was . . . We really didn’t delve into that.”22 Moreover, a promise to work hard or stay in the marriage would not serve as consideration 21 MP3: Oral Argument, Hawaiʻi Supreme Court, at 31:40 (Mar. 4, 2013), http:// www.courts.state.hi.us/courts/oral_arguments/archive/ oasc_11_1074.html. 22 Id. at 33:10. 35 FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER under Whitmore or Bratton. Whitmore, 778 N.Y.S.2d at 75; Bratton, 136 S.W.3d at 600, 603. Sandra and Ray were already in a legal union, therefore, a promise by either to remain in the relationship would not constitute a new promise. Such promises by Sandra would also be illusory. An illusory promise is not consideration. A promise or apparent promise is not consideration if by its terms the promisor or purported promisor reserves a choice of alternative performances unless (a) each of the alternative performances would have been consideration if it alone had been bargained for; or (b) one of the alternative performances would have been consideration and there is or appears to the parties to be a substantial possibility that before the promisor exercises his choice events may eliminate the alternatives which would not have been consideration. Restatement (Second) of Contracts § 77 (1981). That is, promises which allow the promisor to choose from a range of alternative return performances, at least some of which would not constitute consideration, cannot constitute consideration. Words of promise which by their terms make performance entirely optional with the ‘promisor’ do not constitute a promise. In such cases there might theoretically be a bargain to pay for the utterance of the words, but in practice it is performance which is bargained for. Where the apparent assurance of performance is illusory, it is not consideration for a return promise. Id. at cmt. a (citation omitted). Consequently, a return performance that is fully optional cannot constitute consideration. Therefore, a promise of return performance that allows for alternative performances that include not performing, cannot constitute consideration. 36 FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER Here, the promise, “I promise to work hard in the marriage,” would be illusory because Sandra reserved a right to alternative performances—i.e., divorce or separation—which would not constitute consideration. Further, Sandra’s performance of the “promise” was entirely optional; that is, there was no consequence or detriment to Sandra for a decision to “breach” the contract by not working hard in the marriage. Sandra did not make a valid return promise in exchange for Ray’s promise to relinquish marital property or make certain payments in the October 6 Document and the MOU. Therefore, the October 6 “agreement” and MOU are voidable by Ray for lack of consideration.