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1 May, 08:04

Betty, an accountant, agreed to prepare Tim's income tax returns by April 15th, when they were due. Tim then discovered he needed the returns by March 1st for his daughter's college financial aid application. Betty agreed to finish the returns by that date if Tim would pay an additional $250 for her services. Tim felt he had no choice and reluctantly agreed. Now her bill has come. Does Tim have to pay it

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  1. 1 May, 10:50
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    Answer: O Tim must pay because the agreement to complete the tax returns earlier than originally agreed is additional consideration supporting the modification of the contract.

    Explanation:

    When Tim agreed to Betty's stipulation that for her to finish the returns earlier, he would have to pay an extra $250, he in effect agreed to the modification of the contract.

    Modified Contracts are also enforceable by law so Tim has to pay the $250. There was no proof that Betty acted wrongfully as she had to change her schedule and needed to be compensated for the inconvenience. Also even if the modification was not in writing, it is a generally accepted rule that for contracts to be modified orally, the amount must not exceed $500 which it did not.

    Tim is very much liable to pay.
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Home » Business » Betty, an accountant, agreed to prepare Tim's income tax returns by April 15th, when they were due. Tim then discovered he needed the returns by March 1st for his daughter's college financial aid application.
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