Consideration.

Question 1

What is consideration?

Answer 1

The price a party pays for the promise of another party’s price or performance.

Question 2

What are the 4 general principles?

Answer 2

1. Consideration must be sufficient not adequate.
2. Past consideration is not good consideration.
3. Performance of an existing duty is technically not good consideration but often is.
4. It must move from the promisee.

Question 3

What is the case for sufficiency/adequacy?

Answer 3

Thomas v Thomas.

Question 4

What is past consideration (and case)?

Answer 4

Something done in return for something performed in the past cannot be a genuine exchange.
- It is a “voluntary courtesy” - Lampleigh v Brathwait.

Question 5

What are the cases for performance of an existing duty?

Answer 5

Stilk v Myrick.
Hartley v Ponsonby.

Question 6

What are the cases for performance of an existing duty?

Answer 6

Stilk v Myrick.
Hartley v Ponsonby.

Question 7

What are the case facts of Stilk?

Answer 7

• Voyage.
• 2 members of crew leave.
• Rest are promised their wages by captain.
• Just get given their original wages.

Question 8

What is consideration moving from the promisee (and case)?

Answer 8

Should move only from promisee and not a third party.
The exception for third parties is if the duty is owed to them.
Shadwell v Shadwell.

Question 9

What is consideration moving from the promisee (and case)?

Answer 9

Should move only from promisee and not a third party.
The exception for third parties is if the duty is owed to them.
Shadwell v Shadwell.

Question 10

What are the case facts of William v Roffey Bros?

Answer 10

• Refurb flats.
• Worried wouldn’t finish so promised to pay extra and new payment plan.
• Only paid the original amount.

Question 11

What were the practical benefits of Roffey Bros?

Answer 11

• Kept Williams’ services.
• Avoided penalty clause.

Question 12

What was Glidewell’s ration from William?

Answer 12

1. A enters into contract with B.
2. Before completion, B worried won’t finish.
3. B promises A more money.
4. Resulting in B getting a practical benefit/obviating a disbenefit.
5. As long as not from economic duress or fraud.
6. Benefit to B can be consideration for B’s new promise.

Question 13

What is the key principle from Williams?

Answer 13

There must be a practical benefit in order for there to be consideration.

Question 14

What is the key principle from Foakes and Beer?

Answer 14

Part payment of debt cannot satisfy the whole debt.

Question 15

What is the key principle from Pinnel’s case?

Answer 15

A lesser sum cannot satisfy the debt but can be satisfactory when:
1. Payment made in a different place.
2. In a different form.
3. Paid early.

Question 16

What are the case facts of MWB v Rock?

Answer 16

• Leased office space.
• Financial struggles.
• Was going to lock out offices until paid.
• Apparent oral agreement.
• A no oral modification clause (NOM) was valid and meant original agreement stood.

Question 17

What is the modern law on consideration? (3)

Answer 17

1. Must be consideration for an alteration promise.
2. In a promise to pay more money - practical benefit to promissor.
3. In promise to accept less money - no practical benefit to promissor so no consideration.