Consideration

Question 1

Definition of consideration

Answer 1

• exchange of promises for value in a contract (Money, services, Goods) -> Traditional Definition = Dunlop V Selfridge
• It is needed to distinguish between enforceable contracts and gifts/free services which are not enforceable

Question 2

Consideration must be sufficient but not adequate

Answer 2

• sufficient = real + some value
• adequate = what is promised does not need to be real market value
• Chappell v Nestle -> not equal value but suffice
• Thomas v Thomas -> not commercial rent but suffice
• White v Bluett -> promise not to complain lack value so not suffice

Question 3

Past consideration

Answer 3

• promise must not be something that was already done when the agreement was made (Re McArdle) UNLESS one party acted at the others request and it was understood all along that payment would be made later
• payment must have been implied by offeror because actions where so important (Lampleigh v Braithwaite)
• payment implied (Re Casey’s Patents)

Question 4

Existing Duties (contractural/public)

Answer 4

• cannot promise something you already do as a duty (Silk v Myrick)
• EXCEPTIONS:
  
  • exceed duty (Hartley v Ponsonby)
  • practical benefit (Williams v Roffey)
  • the performance of an existing contractual duty to a third party (Scotson v Pegg)