Scribd Logo
Upload

Welcome to Scribd!

  • 114 views

    Consideration

    Uploaded by

    Zuhair Hasan
    Consideration is an essential element of a legally binding contract. Consideration can be either something of value given in exchange for a promise, or the act of forbearing from doing something. Consideration may be executed immediately or executory for future performance. Past consideration is generally not valid consideration, unless it falls under one of three exceptions: an acknowledgment of debt, a promise to pay for a requested service, or a promise that fixes a reward amount for work already performed. Consideration must be sufficient but does not need to be equal in value to what is received in return, and performance of an existing obligation is not valid consideration.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as TXT, PDF, TXT or read online from Scribd

    Consideration

    Uploaded by

    Zuhair Hasan
    114 views2 pages
    Consideration is an essential element of a legally binding contract. Consideration can be either something of value given in exchange for a promise, or the act of forbearing from doing something. Consideration may be executed immediately or executory for future performance. Past consideration is generally not valid consideration, unless it falls under one of three exceptions: an acknowledgment of debt, a promise to pay for a requested service, or a promise that fixes a reward amount for work already performed. Consideration must be sufficient but does not need to be equal in value to what is received in return, and performance of an existing obligation is not valid consideration.

    Copyright

    © Attribution Non-Commercial (BY-NC)

    Available Formats

    TXT, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Consideration is an essential element of a legally binding contract. Consideration can be either something of value given in exchange for a promise, or the act of forbearing from doing something. Consideration may be executed immediately or executory for future performance. Past consideration is generally not valid consideration, unless it falls under one of three exceptions: an acknowledgment of debt, a promise to pay for a requested service, or a promise that fixes a reward amount for work already performed. Consideration must be sufficient but does not need to be equal in value to what is received in return, and performance of an existing obligation is not valid consideration.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as TXT, PDF, TXT or read online from Scribd
    Download as txt, pdf, or txt
    114 views2 pages

    Consideration

    Uploaded by

    Zuhair Hasan
    Consideration is an essential element of a legally binding contract. Consideration can be either something of value given in exchange for a promise, or the act of forbearing from doing something. Consideration may be executed immediately or executory for future performance. Past consideration is generally not valid consideration, unless it falls under one of three exceptions: an acknowledgment of debt, a promise to pay for a requested service, or a promise that fixes a reward amount for work already performed. Consideration must be sufficient but does not need to be equal in value to what is received in return, and performance of an existing obligation is not valid consideration.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as TXT, PDF, TXT or read online from Scribd
    Download as txt, pdf, or txt
    of 2

    Consideration A valuable consideration in the sense of the law may consist either in some righ t, interest, profit or benefit

    accruing to one party, or some forbearance, detri ment, loss or responsibility given, suffered or undertaken by the other. Valid Consideration Consideration may be executed (an act in return for a promise) or executory (a p romise in return for a promise). It may not be past, unless one of three recogni sed exceptions applies. Executed Consideration That which takes place at the present time. Thus in a contract for the sale of g oods, the consideration is executed if the price is paid at the same time that t he goods are delivered. Executory Consideration That which is to take place at some future time. The consideration for the deliv ery of goods would be executory if it is a promise to pay at a future date. Past Consideration Anything which has already been done before a promise in return is given is past consideration which, as a general rule, is not sufficient to make the promise b inding. (Re McArdle) The work on the house had all been completed before the documents were signed. A t the time of the promise the improvements were past consideration and so the pr omise was not binding. In three instances past consideration for a promise is sufficient to make the pr omise binding. A bill of exchange A negotiable instrument, drawn by one party on another, for example by a supplie r of goods on a customer, who by accepting (signing) the bill, acknowledges the debt, which may be payable immediately (a sight draft) or at some future date (a time draft). The holder of the bill can thereafter use an accepted time draft t o pay a debt to a third party or discount it to raise cash. After six (or in some cases twelve) years the right to sue for recovery of a deb t becomes statute barred by the Limitation Act 1980. If, after that period, the debtor makes written acknowledgement of the creditor's claim, the claim is again enforceable at law. When a request is made for a service this request may imply a promise to pay for it. If, after the service has been rendered, the person who made the request pr omises a specific reward, this is treated as fixing the amount to be paid. (Lampleigh v Braithwaite) The defendant's request was regarded as containing an implied promise to pay, an d the subsequent promise merely fixed the amount. Adequacy and sufficiency of consideration Consideration need not be adequate (that is, equal in value to the consideration received in return). There is no remedy at law for someone who simply makes a p oor bargain. (Thomas v Thomas) Compliance with the husband's wishes was not valuable consideration (no economic value attached to it), but the nominal rent was sufficient consideration. Consideration must be sufficient. It must be capable in law of being regarded as consideration by the courts. Performance of an existing obligation imposed by statute is no consideration for a promise of reward. But if some extra service is given that is sufficient cons ideration. (Glasbrook Bros v Glamorgan CC)

    The police had done more than perform their general duties. The extra services g iven, beyond what the police in their discretion deemed necessary, were consider ation for the promise to pay. If there is already a contract between A and B, and B promises additional reward to A if he (A) will perform his existing duties, there is no consideration from A to make that promi se binding. If a claimant does more than perform an existing contractual duty, this may amou nt to consideration. If X owes Y 100 but Y agrees to accept a lesser sum, say 80, in full settlement of Y's claim, there is a promise by Y to waive his entitlement to the balance of 20 . The promise, like any other, should be supported by consideration. (Foakes v B eer) She was entitled to the debt with interest. No consideration had been given by t he claimant for waiver of any part of her rights against him. Intention to create Legal Relation

    You might also like