Scribd
Upload
57 views3 pages

Consideration in Contract Law Guide

Consideration in contract law requires either a benefit to the promisor or detriment to the promisee. Consideration must be sufficient but not necessarily adequate. Existing legal obligations can serve as consideration. Past consideration is not valid consideration unless requested and intended as such by both parties. Part payment of a debt requires extra consideration. Promissory estoppel allows modification of existing contracts without consideration if reliance exists and denying the promise would be inequitable.

Uploaded by

Iqra Rasool
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
57 views3 pages

Consideration in Contract Law Guide

Consideration in contract law requires either a benefit to the promisor or detriment to the promisee. Consideration must be sufficient but not necessarily adequate. Existing legal obligations can serve as consideration. Past consideration is not valid consideration unless requested and intended as such by both parties. Part payment of a debt requires extra consideration. Promissory estoppel allows modification of existing contracts without consideration if reliance exists and denying the promise would be inequitable.

Uploaded by

Iqra Rasool
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 3

lOMoARcPSD|2781372

Consideration

Contract law (University of London)

Distributing prohibited | Downloaded by Iqra Rasool (iqra.rasool@hotmail.com)


lOMoARcPSD|2781372

Considerstion

Currie V Misa 1875 defines consideration as,


“A valuable consideration, in the sense of law, may consist either in some right, interest, profit or benefit
accruing to the one party, or some forbearance, detriment, loss of responsibility given, suffered or
undertaken by the other.”

 Either a benefit to the promisor or a detriment to the promisee is sufficient to make the
promise enforceable.
 To be able to enforce a promise the promisee has provided consideration for that
promise.

 Rules of Consideeation:
1. Consideration must be sufficient need not to adequate
Thomas v Thomas 1842
Chappell v Nestle 1960

2. Existing obligations as good consideration


Three aspects:
i. Obligations which arise under the law, independently of any contract
Glasbrook Bros v Glamorgan 1925
ii. Obligations which are owed under a contract with a third party
Shadwell v Shadwell 1860
The Eurymedon 1975
iii. Obligations to perform an existing obligation under a contract to the same contracting party

 Peefoemance of an Existing obligation


 Stilk v Myrich 1809 established: Performance of an existing obligation could never be good
consideration for a freash promise.
 Hartley v Ponsonby
 William v Roffey : The concept of practical benefit was introduced.

Practical Benefit will only apply:


1. Contract for supply of goods or services
2. A was unable to perform as promised
3. B agreed to pay more
4. B obtained a practical benefit
5. There was no fraud or duress by A
6. If the above are found then consideration is found

 Paet Payment of Debt


 Foakes v Beer 1884: If something extra is done, then the whole debt will be discharged. So if
any separate consideration is provided.
 Practical benefit doesn’t affect part payment of debt.( Re selectmove 1995)

Distributing prohibited | Downloaded by Iqra Rasool (iqra.rasool@hotmail.com)


lOMoARcPSD|2781372

 Past Consideeation
Consideration must be given after the promise to make it enforceable ( Re McArdle 1951)
Exceptions (Pao On v Lau Yui Long 1979):
1. The act constituting the consideration must have been done at the promisors request
2. The parties must have understood that the work was to be paid for in some way.
3. The promise would be legally enforceable had it been made prior to the acts constituting the
consideration.

 Peomissoey estoppel
Modification of existing contracts, where there is no consideration.
 Hughes v Metropolitan Railways
 High Trees House 1947
Limitations:
1. Need for existing legal relations
Exception: Evenden v Guildford City 1975
2. Need for reliance
High Trees House
3. A Shield not Sword
Combe v Combe 1951
4. Must be inequitable for the promisor to go back on promise
D&C Builders v Rees 1966
5. Doctrine is generally suspensory
High Trees House
6. Where promise is prohibited by legislation
Evans v Amicus Healthcare 2003
7. A clear and unambiguous statement
Durham v McLean 2013

Distributing prohibited | Downloaded by Iqra Rasool (iqra.rasool@hotmail.com)

You might also like