Consideration

Question 1

Nature of Consideration

Thomas v Thomas

Answer 1

Consideration must flow between both parties. Peppercorn principle, value in the eyes of the law.

Question 2

Nature of Consideration

Governers of Dalhousie v The Estate of Arthur Butler

Answer 2

Exchange of two unrelated promises is not consideration. One promise must be conditional on the other. Nudum Pactum.
Dalhousie building things was not conditional on the consideration from Arthur

Question 3

Past Consideration

Eastwood v Kenyan

Answer 3

Past consideration is seperated in time therefore there is no exhange of promises. Lacks mutuality.
No consideration if one party lacks any connection to the other at the time of performance.

Question 4

Past Consideration

Lampleigh v Brathwait

Answer 4

Reasonable to assume that you will be compensated for an act engaged with the party that made a later promise is good consideration.

Question 5

Forebearance of suit

DCB and Halord Arkin v Zellers

Answer 5

Forebearance consideration is valid even if the underlying suit is invalid if
1. Honestly believe its valid
2. Objectively reasonable belief
3. Seriously intended to pursue the claim

Question 6

Pre-Existing Duties

Pao On v Lau Yiu Long

Answer 6

Third party pre-existing duty. Taking on additional liability can constitute consideration.

Question 7

Pre-Existing Duties

Stilk v Myrick

Answer 7

Promise to pay more for a pre-existing duty is not sufficient consideration. No fresh consideration.

Question 8

Pre-Existing Duties

Gilbert Steel v University Construction Ltd

Answer 8

Modern Example of Stilk.

Question 9

Pre-Existing Duties

William v Roffey Bros

Answer 9

Practical Benefit can constitute consideration.
Commercial advantage.
No duress as assessed in context.

Question 10

Pre-Existing Duties

Greater Fredericton Airport Authority v Nav Can

Answer 10

Canadian context of William Raffey.
Removes the necessity of mutual interest, focuses on duress.
To establish economic duress, two conditions must be met:
1. the promise must be made under pressure (demand/threat);
2. the pressured party must have no option but agreeing.
If these conditions are met, three factors must be analyzed:
1. was the promise supported by consideration?
2. was the promise made “under protest”?
3. were reasonable steps taken to disaffirm the promise?

A post-contractual modification, unsupported by consideration, may be enforceable if it is established that the variation was not procured by economic duress.

Question 11

Pre-Existing Duty

Rosas v Toca

Answer 11

• When you look at the question of whether there was duress, ask yourself whether there was mutual or practical benefit.
• If the modification is mutually beneficial to both parties, then it is a pretty good indication that there was no duress.
• If one party is not getting anything new, while one benefits, then this may suggest (not confirm) that there is duress.

Question 12

Accord in Satisfaction

Promise to Accept Loss

Answer 12

What flows from the debtor that would could as consideration. Agreeing to pay less is impossible without satisfying the original contract
Because of historical reasons these are treated differently than promises to pay more

Question 13

Accord & Satisfaction

Foakes v Beer

Answer 13

Pinnels case principle: Paying less in satisfaction of more
This could be displaced by a peppercorn, because it is a novel element not covered in the existing obligation.

Question 14

Accord & Satisfaction

Foot v Rawlings

Answer 14

Anything new can constitute consideration.
Cheques vs cash

Question 15

Accord & Satisfaction

Process Automation v Norstream Intersect in

Answer 15

If there is duress then the Law and Equity act will not apply

Question 16

Promissory Estoppel

4 Elements of PE

Answer 16

1) there must be a pre existing relationship between the parties
2) There must be a clear representation between the parties that something wont be strictly enforced in the pre existing contract (implicit, or explicit)
3) The party then must rely on that interpretation, meaning you must change your position in some way.
4) lastly it must be deemed unfair in the language of equity to disregard that promise.

Question 17

Promissory Estoppel

Hughes v Metropolitan Railway

Answer 17

Pre-dates PE though textbook
Raises all 4 points of PE.

Question 18

Promissory Estoppel

Central London Property v High Trees House

Answer 18

Creation of PE

Question 19

Promissory Estoppel

Collier v P&MJ Wright

Answer 19

Foakes and Beer is Inapplicable if you can raise PE

Question 20

Promissory Estoppel

John Burrows v Subsurface Surveys

Answer 20

Focuses on Element 2
Clear representation is a high threshold, though could still be implied.
This case: Friendly Indulgence

Question 21

Promissory Estoppel

D&C Builders v Rees

Answer 21

4th element of PE wont be satisfied if 2nd element procured under duress.
Duress:
1. Illegitimate pressure.
2. Person had no practical choice but to agree with pressure.

Question 22

Promissory Estoppel

Saskatchewan River Bungalows v Maritime Life Assurance

Answer 22

Can 2nd PE be revoked? Yes
1. If you give notice that you are taking it back (reasonable notice).
2. If you give notice that it’s being taken back BEFORE it’s relied on.
Reliance:
1) Causal reliance -> changed position and acted in some way, not something you would have done but for the representation.
(2) Detrimental reliance -> reliance on It’s own isn’t enough, you need to show you not only changed your position but changed it in a way that is detrimental.

Question 23

Promissory Estoppel

WJ Alan and Co v El Nasr Export

Answer 23

No need for detrimental reliance under 3 of Pe. Acting on a promise is sufficient.

Question 24

Promisorry Estoppel

The Post Chaser

Answer 24

Under third element of the test, Will it be inequitable to go back on a promise if going back on it will not be detrimental

Question 25

Promissory Estoppel

Trial Lawyers of BC v Sun Alliance

Answer 25

The SCC held that you do need detrimental reliance to raise and estoppel.

Question 26

Promissory Estoppel

Combe v Combe

Answer 26

Estoppel does not create a cause of action, it can only be used as a shield.
Estoppel can only be raised if there is a right to something

Question 27

Promissory Estoppel

MN v ATA

Answer 27

Sword V Shield
PE would require an antecedent contractual relationship and a promise not to enforce a particular right which she relies on, and then it would be inequitable for him to take that promise back and then try to enforce the right.