Originally Posted by Nebish
Under contract law, there must be "consideration" passing between the buyer and seller. "Consideration" is something of value, usually money, which is why a deposit is necessary to "seal the bargain."
... Such an arrangement is simply not legally enforceable without consideration. (emphasis added)
We need to clarify that the mere promise to pay
satisfies the consideration requirement, even if no payment is immediately made. No deposit is necessary to form a legally binding contract.
Handlebar's promise to sell the bike is sufficient consideration, and Handlebar's friend's promise to pay for the bike is also sufficient consideration.
This is the law in all 50 United States.
It also appears to be the law in your own jurisdiction. The former Ontario High Court recognized that
[t]he most characteristic rule in our law of consideration, and the most important for the business of life, is that mutual promises are sufficient consideration for one another. Gilbert v. Barron
(1958), 13 D.L.R. (2d) 262 at 265. See also Revised Statutes of Ontario
, 1990. Chapter S.1, §§ 1 ["contract of sale"], 4, 26, 28(2), 47.