Chapter 12, Problem 1TS

Summary Introduction

Case summary:

In 1969, at the age of seventeen, Person A began working for company P. She had reached the rank of a bookkeeper, chief of office and right-hand treasurer by 2007. The board of chiefs of company P, in recognition of their capacity, dedication, and long service time, agreed to increase the month-to-month salary of Individual A to $4,000 and make a retirement plan. The agreement allowed person A to be granted the privilege of withdrawing from the complex contract if she wished to accept a retirement payment of $2,000 per month for life, even though the board expressed in faith that Person A would continue to represent the organization for a long time. Person A, as it may be, agreed to resign two a long time later. Company F has paid her retirement pay to Person A until 2016. The business suspended instalments from that point on.

To discuss: The arguments that the company’s promise to pay person A $2,000 per month for life is enforceable.