Consideration

Question 1

What is consideration

Answer 1

the price paid by the promisor to the promisee to execute the contract

Question 2

What is an illusory promise

Answer 2

if one party retains all discretion there is no consideration (Bio-tech - equity scheme promised, but none given so no cosnsideration)

Question 3

What is the situation with performing existing legal duties

Answer 3

Usually existing obligations are not consideration. Stilk v Myrick - no consideration for doing what is already required

Question 4

Roffey Bros on existing legal duties

Answer 4

may suffice to enforce a further promise where the promisor receives a further practical benefit as consideration:
* Agreement to raise subcontract price to ensure the subcontractors finished their work in time was enforceable
* Provides a practical benefit to the promisor, even without new consideration.

Question 5

Pinnels Rule (Foakes v Beer)

Answer 5

A creditor’s promise to accept a lesser sum in satisfaction of the whole debt is not enforceable unless supported by additional consideration.

Question 6

Exceptions for Pinnels Rule

Answer 6

Exceptions:

○ Accord: Agreement to discharge an obligation.

○ Satisfaction: Consideration provided for the release of the obligation

Question 7

Gloria Jeans on consideration

Answer 7

Gloria Jeans followed Roffrey Bros practical benefit approach