What is the definition of Consideration
Consideration is the exchange of things with economic value
What are the rules of consideration?
- Sufficiency
- Past consideration
- legal or contractual duty
- Consideration must move from the promisee
What is the rule of sufficiency case law?
Thomas v ThomasThat consideration must be sufficient, but doesn’t need to be adequate. So things exchanged must have economic value but don’t need to be equal.
What is the case law for Giving up something
Sufficiency
Jones v Padvatton - shows that even giving up something of value counts as consideration
Case law for love and affection
White v Bluett - shows that actions of love and affection carry no economic value, and therefore are not good consideration
What is the rule of past consideration? case law
Re McArdle, any consideration given in the past is not good consideration. Consideration must come after an agreement, not before.
What is the implied promises exception to the past consideration rule?
Where someone implies payment will be made before the other party acts, but there is no formal agreement until after the action
What cases prove implied promise and in what situations
Lampleigh v Braithwait - Past consideration can work where work was requested
Re Casey’s Patents - Past consideration can work in a buisiness setting such as between employers and employees
What is the rule of existing legal duties?
Existing legals duties are usually not good consideration
Case law for Existing legal duty
Collins v Godfrey- Shows that doing something already required by law is not good consideration for another promise.
Exception to existing legal duties case law
Glasbrook Bros. v Glamorgan CC - shows that going beyond the legal duty can be good consideration.
Case law for existing contractual duties
Stilk v Myrick - doing something already required by contractual duties is not good consideration.
What is the “going beyond the duty” excpetion for existing contracual duties? case law
Hartley v Ponsonby - shows that adding something extra/going beyond the contract may count as good consideration.
What is the “practical benefit” excpetion for existing contracual duties?
Williams v Roffey Bros - shows that if one party gains a practical benefit from someone completing their existing contract, this may count as new consideration for extra money.
What is the “third party contracts” excpetion for existing contracual duties?
Scotson v Pegg - Doing the same thing but for different people is good consideration for both agreements.
case law for consideration must move from the promisee
Tweedle v Atkinson - No party can sue or be sued if they have been given no consideration as they will no tbe a party to a contract
