{"id":26901,"date":"2022-09-05T03:28:18","date_gmt":"2022-09-05T03:28:18","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/amjur\/contracts-sect-496.html"},"modified":"2022-08-25T11:47:53","modified_gmt":"2022-08-25T11:47:53","slug":"contracts-sect-496","status":"publish","type":"amjur","link":"https:\/\/reference.findlaw.com\/amjur\/contracts-sect-496.html","title":{"rendered":"Am Jur 2d – Contracts \u00a7 496"},"content":{"rendered":"
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V. Modification, Extinguishment, and Renewal, B. Modification, 1. Scope and Effect, \u00a7 496 – By consent or new agreement<\/h2>\n

A modification of a contract is a change in one or more aspects of it that introduces new elements into the details or cancels some of them but leaves the general purpose and effect of the contract intact.[1<\/a>] Modification of a contract normally occurs when the parties agree to alter a contractual provision or to include additional obligations, while leaving intact the overall nature and obligations of the original agreement.[2<\/a>] Parties may modify or waive their rights under a contract and embed new terms.[3<\/a>] Also, parties may alter any term of an existing contract by entering into a subsequent contract, and the contract, as modified, becomes a new contract between the parties, and the meaning to be given the subsequent agreements depends on the intention of the parties.[4<\/a>]<\/p>\n

Parties to a contract are not forever locked into its terms,[5<\/a>] but have the right to amend their contract by mutual consent.[6<\/a>] Accordingly, parties to an existing contract may, by mutual assent, modify it,[7<\/a>] provided the modification does not violate the law[8<\/a>] or public policy,[9<\/a>] and provided that there is consideration for the new agreement or that it satisfies a statute or is made under circumstances making consideration unnecessary.[10<\/a>] Furthermore, the parties to a written contract may modify, waive, or make new terms notwithstanding terms in the contract designed to hamper such freedom.[11<\/a>]<\/p>\n

A modified contract is essentially a new contract which must pass the same tests and scrutiny that apply to the initial determination of whether an enforceable agreement exists.[12<\/a>] A valid modification of a contract must satisfy all the criteria essential for a valid original contract,[13<\/a>] including offer, acceptance, and consideration.[14<\/a>]<\/p>\n

A modification of a contract requires the mutual assent of both,[15<\/a>] or all, parties to the contract.[16<\/a>] Hence, one party to a contract may not unilaterally alter its terms[17<\/a>] without the assent of the other party.[18<\/a>] Mutual assent is as much a requisite element in effecting a contractual modification as it is in the initial creation of a contract.[19<\/a>] Furthermore, a valid contract modification requires mutual assent to the meaning and conditions of the modification and the parties must assent to the same thing in the same sense.[20<\/a>] A valid modification of a contract requires a meeting of the minds of the parties,[21<\/a>] which must be spelled out, either expressly or impliedly, with sufficient definiteness.[22<\/a>]<\/p>\n

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All case links go to Westlaw and require login.<\/h2>\n<\/div>\n

1<\/a> \u00a0 F.R.S. Development Co., Inc. v. American Community Bank and Trust, 2016 IL App (2d) 150157, 2016 WL 715112 (Ill. App. Ct. 2d Dist. 2016)<\/a> <\/span>.
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2<\/a> \u00a0 Hildreth Consulting Engineers, P.C. v. Larry E. Knight, Inc., 801 A.2d 967 (D.C. 2002)<\/a> <\/span>.
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3<\/a> \u00a0 F.R.S. Development Co., Inc. v. American Community Bank and Trust, 2016 IL App (2d) 150157, 2016 WL 715112 (Ill. App. Ct. 2d Dist. 2016)<\/a> <\/span>.
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4<\/a> \u00a0 Alarmax Distributors, Inc. v. New Canaan Alarm Co., Inc., 141 Conn. App. 319, 61 A.3d 1142, 80 U.C.C. Rep. Serv. 2d 258 (2013)<\/a> <\/span>.
<\/span> \u00a0Subsequent agreement, to be a modification and deemed part of a single contract under New York law, must do more than label itself an amendment or incorporate terms and provisions from the earlier agreement; it must alter the original terms and provisions in the first agreement. In re New York Skyline, Inc., 432 B.R. 66 (Bankr. S.D. N.Y. 2010)<\/a> <\/span>.
<\/span> \u00a0As to subsequent or secondary agreements, see \u00a7\u00a7 489<\/a> <\/span> to 495<\/a> <\/span>.
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5<\/a> \u00a0 Urban Sites of Chicago, LLC v. Crown Castle USA, 2012 IL App (1st) 111880, 365 Ill. Dec. 876, 979 N.E.2d 480 (App. Ct. 1st Dist. 2012)<\/a> <\/span>.
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6<\/a> \u00a0 A & T Siding, Inc. v. Capitol Specialty Ins. Corp., 358 Or. 32, 359 P.3d 1178 (2015)<\/a> <\/span>.
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7<\/a> \u00a0 Large v. Mobile Tool Intern., Inc., 724 F.3d 766 (7th Cir. 2013) (applying Virginia law)<\/a> <\/span>; Allstate Ins. Co. v. Stinebaugh, 374 Md. 631, 824 A.2d 87 (2003)<\/a> <\/span>.
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8<\/a> \u00a0Parties to a written contract are usually free to modify or terminate contracts by separate agreement; however, as is the case with the terms of the original contract, the modifications must be consistent with the law. Ayres v. Ocwen Loan Servicing, LLC, 129 F. Supp. 3d 249 (D. Md. 2015)<\/a> <\/span>.
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9<\/a> \u00a0 F.R.S. Development Co., Inc. v. American Community Bank and Trust, 2016 IL App (2d) 150157, 2016 WL 715112 (Ill. App. Ct. 2d Dist. 2016)<\/a> <\/span>.
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10<\/a> \u00a0 Allstate Interiors & Exteriors, Inc. v. Stonestreet Const., LLC, 907 F. Supp. 2d 216 (D.R.I. 2012)<\/a> <\/span>, aff’d, 730 F.3d 67 (1st Cir. 2013)<\/a> <\/span>.
<\/span> \u00a0It is a fundamental principle of Florida contract law that a promise must be supported by consideration to be enforceable; this principle applies with equal force to the modification of a contract. Solnes v. Wallis & Wallis, P.A., 15 F. Supp. 3d 1258 (S.D. Fla. 2014)<\/a> <\/span>, aff’d, 606 Fed. Appx. 557 (11th Cir. 2015)<\/a> <\/span>.
<\/span> \u00a0As to the necessity of consideration, see \u00a7 500<\/a> <\/span>.
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11<\/a> \u00a0 Lone Mountain Production Co. v. Natural Gas Pipeline Co. of America, 984 F.2d 1551 (10th Cir. 1992) (applying Utah law)<\/a> <\/span>; Metzler Contracting Co. LLC v. Stephens, 774 F. Supp. 2d 1073 (D. Haw. 2011)<\/a> <\/span>, aff’d, 479 Fed. Appx. 783 (9th Cir. 2012)<\/a> <\/span>.
<\/span> \u00a0Under New Hampshire law, parties to a contract cannot, even by express provision in the contract, deprive themselves of the power to alter, vary, or discharge it by subsequent agreement. In re Chicago Investments, LLC, 470 B.R. 32 (Bankr. D. Mass. 2012)<\/a> <\/span>.
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12<\/a> \u00a0 Vasily v. MONY Life Ins. Co. of America, 104 F. Supp. 3d 207 (D. Conn. 2015)<\/a> <\/span>.
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13<\/a> \u00a0 AIU Ins. Co. v. TIG Ins. Co., 934 F. Supp. 2d 594, 94 A.L.R.6th 735 (S.D. N.Y. 2013)<\/a> <\/span>, aff’d, 577 Fed. Appx. 24 (2d Cir. 2014)<\/a> <\/span>.
<\/span> \u00a0Modification of a contract, because it is also a contract, requires all of the requisite elements of a contract. AM General LLC v. Armour, 46 N.E.3d 436 (Ind. 2015)<\/a> <\/span>.
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14<\/a> \u00a0 F.R.S. Development Co., Inc. v. American Community Bank and Trust, 2016 IL App (2d) 150157, 2016 WL 715112 (Ill. App. Ct. 2d Dist. 2016)<\/a> <\/span>.
<\/span> \u00a0A contract, either oral or written, may be modified by a subsequent agreement which is supported by legally sufficient consideration, or a substitute therefor, and meets the requirements for contract formation. Shedden v. Anadarko E. & P. Co., L.P., 136 A.3d 485 (Pa. 2016)<\/a> <\/span>.
<\/span> \u00a0As to consideration, see \u00a7 500<\/a> <\/span>.
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15<\/a> \u00a0 Van Camp v. Van Camp, 333 Ark. 320, 969 S.W.2d 184 (1998)<\/a> <\/span>.
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16<\/a> \u00a0 Cambridge Technologies, Inc. v. Argyle Industries, Inc., 146 Md. App. 415, 807 A.2d 125, 48 U.C.C. Rep. Serv. 2d 966 (2002)<\/a> <\/span>.
<\/span> \u00a0Under Pennsylvania law, while a contract may be altered after its formation, all parties must mutually agree to the new terms and consideration must be exchanged. In re Commonwealth Renewable Energy, Inc., 540 B.R. 173 (Bankr. W.D. Pa. 2015)<\/a> <\/span>, stay pending appeal denied, 2016 WL 1238199 (Bankr. W.D. Pa. 2016)<\/a> <\/span>.
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17<\/a> \u00a0 SCG Harbourwood, LLC v. Hanyan, 93 So. 3d 1197 (Fla. 2d DCA 2012)<\/a> <\/span>.
<\/span> \u00a0Unilateral statements or actions, made after an agreement has been reached or added to a completed agreement, clearly do not serve to modify the original terms of the contract, especially where the other party does not have knowledge of the changes, because knowledge and assent are essential to effective modification. County of Morris v. Fauver, 153 N.J. 80, 707 A.2d 958 (1998)<\/a> <\/span>.
<\/span> \u00a0While a waiver may be effectuated by one party, a contractual modification is the result of the bilateral action of both parties to the transaction. RBC Nice Bearings, Inc. v. SKF USA, Inc., 318 Conn. 737, 123 A.3d 417 (2015)<\/a> <\/span>.
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18<\/a> \u00a0 Great American Assurance Company v. PCR Venture of Phoenix LLC, 2015 WL 10008627 (D. Ariz. 2015)<\/a> <\/span>.
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19<\/a> \u00a0 AIU Ins. Co. v. TIG Ins. Co., 934 F. Supp. 2d 594, 94 A.L.R.6th 735 (S.D. N.Y. 2013)<\/a> <\/span>, aff’d, 577 Fed. Appx. 24 (2d Cir. 2014)<\/a> <\/span>; Joseph General Contracting, Inc. v. Couto, 317 Conn. 565, 119 A.3d 570 (2015)<\/a> <\/span>.
<\/span> \u00a0Mutuality is the centerpiece to waiving or modifying a contract, just as mutuality is the centerpiece to forming any contract. Quality Products and Concepts Co. v. Nagel Precision, Inc., 469 Mich. 362, 666 N.W.2d 251 (2003)<\/a> <\/span>.
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20<\/a> \u00a0 Vasily v. MONY Life Ins. Co. of America, 104 F. Supp. 3d 207 (D. Conn. 2015)<\/a> <\/span>.
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21<\/a> \u00a0 Pocatello Hosp., LLC v. Quail Ridge Medical Investor, LLC, 156 Idaho 709, 330 P.3d 1067 (2014)<\/a> <\/span>; Blackstone Medical, Inc. v. Phoenix Surgicals, L.L.C., 470 S.W.3d 636 (Tex. App. Dallas 2015)<\/a> <\/span>.
<\/span> \u00a0Under Louisiana law, contract modification will not be effected when there is no meeting of the minds regarding the modification, such as when parties did not discuss or agree to the change. Society of Roman Catholic Church of Diocese of Lafayette, Inc. v. Interstate Fire & Cas. Co., 126 F.3d 727, 47 Fed. R. Evid. Serv. 1406 (5th Cir. 1997)<\/a> <\/span>.
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22<\/a> \u00a0 Tech Center 2000, LLC v. Zrii, LLC, 2015 UT App 281, 363 P.3d 566 (Utah Ct. App. 2015)<\/a> <\/span>.
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Read this complete Am Jur 2d section on Westlaw<\/a><\/b><\/div>\n","protected":false},"parent":0,"menu_order":0,"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":false,"_modified_date":"","_cloudinary_featured_overwrite":false},"class_list":["post-26901","amjur","type-amjur","status-publish","hentry"],"acf":[],"_links":{"self":[{"href":"https:\/\/reference.findlaw.com\/legal-api\/wp-json\/wp\/v2\/amjur\/26901","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/reference.findlaw.com\/legal-api\/wp-json\/wp\/v2\/amjur"}],"about":[{"href":"https:\/\/reference.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/amjur"}],"wp:attachment":[{"href":"https:\/\/reference.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=26901"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}