Consideration Flashcards
What are the types of consideration in contracts?
1) Money for goods/services; 2) Service for service; 3) Forbearance (settlements); 4) Contract modification; 5) Employment contracts.
What is the importance of consideration in English Law?
It ensures only intentional bargains are binding, acting as proof of intent to contract (Rann v. Hughes, 1778).
How did Blackstone and Pollock define consideration?
Blackstone: ‘Recompense given by one party to another.’
Pollock: ‘Price for which a promise is bought.’
What does Section 2(d) define as consideration?
An act, abstinence, or promise made at the desire of the promisor, by the promisee or another person.
Explain ‘At the Desire of the Promisor’ with a case example.”
“Consideration must be done at the promisor’s request (e.g., Durga Prasad v. Baldeo, 1880).”
What is ‘Privity of Contract’?”
“Only parties to a contract can enforce it; third parties have no right to sue.”
What is the ‘Privity of Consideration’ principle?
“Only those who provide consideration can sue on a promise (e.g., Tweddle v. Atkinson, 1861).”
What are exceptions to the Privity of Contract rule?
1) Trust beneficiaries; 2) Marriage/family arrangements; 3) Acknowledgment or estoppel; 4) Covenants with land.
What does ‘Consideration must be of some value’ mean?
Consideration must hold value in law, though it need not be adequate (e.g., White v. Bluett, 1853).
Is adequacy of consideration required in a contract?
No, adequacy is not required; only the presence of value matters (Section 25, Explanation).
What is past consideration, and is it valid?”
In Indian law, past consideration is valid if it was done at the promisor’s request.
Differentiate between present, past, and executory consideration.”
Present: Immediate exchange (executed). Past: Action done before the promise. Executory: Future performance.
What is forbearance to sue as consideration?
Refraining from legal action on a valid claim is recognized as valuable consideration.
What does ‘consideration need not be adequate’ signify?
Courts do not judge if consideration’s value is equivalent to the promise as long as it holds some legal value.
