Batsakis v. Demotsis
Court of Civil Appeals of
226 S.W.2d 673.
Facts: The defendant wrote the plaintiff a letter in 1942 promising to pay $2,000 at 8% interest based on a supposed $2,000 loan to the defendant. The plaintiff sued for the money and the defendant argued that the contract was unenforceable due to want of consideration because, in reality, the plaintiff only lent the defendant $25 (the value of 500,000 drachmae at the time). The trial court found for the plaintiff in the amount of $750 plus interest. The plaintiff appealed.
Issue: Was the 500,000 drachmae adequate consideration to produce an enforceable promise?
Rule: A complete lack of consideration will make a promise unenforceable, but “[m]ere inadequacy of consideration will not void a contract.”
Analysis: In essence, the court finds that 500,000 drachmae was sold for $2,000 and that this exchange was appropriately bargained for. It also seems that the lie exacted from the defendant by the plaintiff that is contained in the written instrument does not void the promise.
In essence, this was a loan at about 2000% annual interest. The court won’t interfere because it feels that the defendant got exactly what she contracted for.
Conclusion: The court upheld the judgment for the plaintiff, but increased the award to the full $2,000 plus interest.