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The Title 28 of the United States Code QUESTION #3713
Question 1
A contractor agrees to build a deck for a homeowner for $\text{\$10,000}$. Halfway through, the contractor realizes the cost of wood has spiked and tells the homeowner, 'I need an extra $\text{\$2,000}$ to finish, or I'm walking.' The homeowner agrees. After the deck is finished, the homeowner pays only $\text{\$10,000}$. Can the contractor recover the extra $\text{\$2,000}$?
  • Yes, because the homeowner agreed to the modification.
  • No, because of the 'pre-existing duty rule.'✔️
  • Yes, because the price spike was an 'unforeseeable difficulty.'
  • No, unless the modification was in writing.
Correct Answer Explanation
Under the common law 'pre-existing duty rule,' a promise to pay more for a service the party is already legally obligated to perform is unenforceable for lack of new consideration.