Pennsy Supply, Inc. v. American Ash Recycling Corp. of Pennsylvania
Pennsylvania Superior Court
895 A.2d 595 (2006)
Facts: Pennsy Supply was subcontracted to do some paving; the people who put up the contract mentioned that American Ash had some free AggRite for the project. Pennsy used it; the paving cracked, and they had to redo it and dispose of the AggRite, which is classed as toxic waste. Pennsy sued American Ash for the disposal costs, which it only incurred because the product was defective, and which it saved American Ash by using it for the project.
Procedure: Trial court dismissed; Pennsy appealed.
Issue: Was there consideration?
Holding: Yes. (Remanded for further proceedings.)
Reasoning: It wasn't a gift because American Ash received a benefit from the arrangement, which was the reason they were offering it free in the first place. "Complaint alleges facts which, if proven, would show the promise induced the detriment and the detriment induced the promise. This would be consideration."
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6 comments:
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I feel like this could benefit from a clearer issue statement and a clear rule statement (issue + ruling). Yes, GENERALLY the issue is whether there is consideration but the issue idiosyncratic to Pennsy v. American Ash is more specific. Here's my try:
The issue: "Does Pennsy's relief of American Ash's legal obligation to dispose of a material classified as hazardous waste, such that American Ash avoided the costs of disposal . . . constitute consideration?"
The ruling: Yes.
The rule (issue + ruling): Relieving the offeror of a legal obligation is sufficient consideration to enforce a contract.
PS I felt like you nailed explaining why American Ash's offer wasn't a gift. Disclaimer: I'm a 1L myself so do your own analysis to be sure!
The key issue I think is Holmes' statement, "the promise must induce the detriment and the detriment must induce the promise." Thus, the promise of free material induced the act of hauling it away (by Pennsy) and Pennsy's taking it away is why American Ash gave it for free.
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