Levine v. Blumenthal
Supreme Court of New Jersey, 1936.
117 N.J.L.23, 186 A. 457.

Facts:

Blumenthal leased a store from Levine. The agreement was for two years, and would cost $2,100 for the first year, and $2,400 the second. Almost a year in, Blumenthal notified Levine that it would be impossible for them to pay any increase in rent, and they claimed Levine agreed to let them rent at the current price until business improved. Blumenthal paid the second year’s rent at the $175/month reduced rent.

  • At the end expiration of the term, Levine sued to recover the unpaid balance of the increase in rent for the second year.

History:

Lower court ruled in favor of Levine:

  • A subsequent oral agreement had been made, but it was not supported by lawful consideration.

Issue:

Was there consideration for the rent reduction?

Holding:

No. Affirmed.

Reasoning:

  • A promise to do what the promisor is already bound to do is an unreal consideration – “preexisting duty rule” or “legal duty rule.”
  • As a general rule, a promise to modify a contract other than one for the sale of goods requires consideration to be enforceable.