chapter 2 - consideration Flashcards
1
Q
What is consideration?
A
It is the concept of exchange - agree to provide something in return for that promise
2
Q
What is executory consideration?
A
Contracting parties make promises to perform something in the future after the contract has been formed
3
Q
What is executed consideration?
A
At the formation of contract, the consideration has been performed
4
Q
What are the rules governing consideration?
A
- it must not be past
- must move from promisee
- need not to be adequate
- must be sufficient
5
Q
What is not good consideration?
A
- existing contracts between parties
- public duty
- existing contract with third party
- part payment of debt
6
Q
When is part payment good consideration?
A
- if some new element is introduced to the payment
- payment of lesser sum by third party
- practical obligation
7
Q
What is the promissory estoppel rule?
A
Part payment of a debt is not good consideration to discharge the whole debt
WHY?
Consideration is not exchanged
8
Q
What are the parameters of promissory estoppel?
A
- it acts as a shield(defence) not a sword(action)
- clear & unequivocal promise that existing legal rights will not be fully enforced
- a change of position in reliance on the promise
- inequitable to allow the promisor to go back on their promise
9
Q
When can a promisors right to resume strict legal rights arise?
A
- rights to payments may resume once promissory period resumes
- promisor may resume full legal rights are giving reasonable notice of their intention to do so
