Lecture 8 consideration PDF

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Consideration and its types...

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25/10/19! Contract law: consideration! A valid contract has! - Offer ! - Acceptance! - Intention to create legal relations! - Consideration! What is consideration! - a benefit which must be bargained for between the parties! - must be of value (at least to the parties), and is exchanged for the performance or promise of performance by the other party (such performance itself is consideration)! - one consideration (thing given) is exchanged for another consideration. Not doing an act (forbearance) can be consideration, such as "I will pay you $1,000 not to build a road next to my fence.”! Consideration ‘rules’! - Consideration does not have to be adequate, but it must be sufficient! - Past consideration is not good consideration! - Generally, performance of existing duties does not give ruse to consideration! - The consideration must move from the promisee! - Part payment of a debt is not good consideration! Adequate and sufficient!

- consideration does not need to be adequate, but it must be sufficient! - Consideration must be legally sufficient. Sufficient does not mean that consideration needs to

be adequate. In other words, the benefit or detriment received in return does not need to be equivalent in value, to that which is given.! - e.g use of data for a free mobile app! - Chappell v Nestle (1960)! The peppercorn rule! - a peppercorn is often used as an example to mean a very small or token payment! - Peppercorn is also used to mean ‘anything small or insignificant’! Consideration must be sufficient! - although consideration does not have to be adequate, it must be sufficient! - White v Bluett (1853)! Past consideration! - generally, past consideration is not good consideration! - Re McArdle (1951)! - Where past consideration is preceded by a request, it may be valid consideration! - Lampleigh v Braithwait (1615)!

Pre existing duties! - a pre existing duty usually refers to one of two things! - Legal duty! - Contractual duty! Pre existing legal duty! - does not give rise to consideration! - Collins v Godefroy ! - However there is an exception to this rule! - Glasbrook Bros v Glamorgan CC (1925)! - Going farther and beyond a normal call of duty might be sufficient to constitute consideration! - Harris v Sheffield United Football Club Ltd (1988)! Pre existing contractual duties! - does not give rise to consideration! - Stilk v Myrick (1809)! - There is an exception to this rule! - Williams v Roffey (1991)!

- The CofA stated that it was possible to find consideration even if the promisee was merely performing an existing contractual duty. In order to do so, there would have to be a factual or practical benefit to the promisor. It’s difficult to predict when a court will find such a benefit.! Moving from the promisee! - Consideration must move from the promisee! - Tweddle v Atkinson (1861)! - This means that generally a party that has not provided consideration for the agreement cannot enforce it! - Only a person that has provided consideration can enforce a promise! Part payment of debt! - generally is not good consideration! - This occurs when the person owing a money offers to pay a smaller sum if the creditor promises to accept it as full settlement for the debt! - Pinnel (1602)! - Foakes v Beer (1884)! - However, part payment of a debt may constitute consideration if it provides the creditor with some benefit! 1. Where part payment is offered before the due date! 2. Where part payment is supplemented by a chattel! - Part payment by a third party may also constitute consideration! - Hirachand Punamchand v Temple (1911)! Summary! - Consideration is required for a valid contract! - Consideration does not need to be adequate but must be sufficient! - Past consideration is not good consideration! - Generally, performance of existing duties does not give rise to consideration. But there are exceptions to this rule! - The consideration must move from the promisee! - Part payment of a debt is not good consideration...