Consideration

Question 1

define consideration

Answer 1

‘price for which something is bought’

Question 2

what must each party do for consideration to be present?

Answer 2

each party must ‘give something’ or promise to give something of value

Question 3

does consideration have to be present for a valid contract/

Answer 3

yes

Question 4

what are the 6 rules of consideration?

Answer 4

1. sufficient
2. past consideration
3. move from the promisee
4. existing duty
5. pre-existing debt
6. duty imposed by law

Question 5

what is the 1st rule of consideration?

Question 6

what is the 1st rule of consideration

Answer 6

consideration need not be adequate but it must be sufficient

Question 7

who is it up to to decide if consideration is adequate

Answer 7

parties

Question 8

in what case was the consideration adequate

Answer 8

Thomas v Thomas

Question 9

in what case was the consideration sufficient

Answer 9

Chappell v Nestle

Question 10

what did Chappell v Nestle say about sufficient

Answer 10

it’s a legal term - what’s punished must be real, tangible + have some actual value

Question 11

what is past consideration

Answer 11

something already done at the time the agreement is made

Question 12

what is the 2nd rule of consideration

Answer 12

past consideration is not good consideration

Question 13

what case said that where the consideration is past there will not be a valid contract

Answer 13

Re McArdle

Question 14

in what case was it shown that where A requests some performance from B before a contract comes into existence, on common understanding that there will be a contract + that there will be a payment - valid consideration

Answer 14

Lampleigh v Braithwaite

Question 15

what is the 3rd rule of consideration

Answer 15

consideration must move from the promisee

Question 16

in what case did the husband’s claim fail because he had given no consideration

Answer 16

Tweddle v Atkinson

Question 17

what is the 4th rule of consideration

Answer 17

performance of an existing contractual duty cannot be consideration for a new contract

Question 18

what case states that merely doing something you are already bound to do can never amount to consideration

Answer 18

STILK v Myrick

Question 19

what case states that it will be consideration if D done more than was identified in the contract

Answer 19

Hartley v Ponsonby

Question 20

what case states that there will also be an exception is party making promise to pay extra receives an extra benefit

Answer 20

Williams v Roffey Bros

Question 21

what is the 5th rule of consideration

Answer 21

a promise to accept part payment of a pre-existing debt in place of the whole debt is not consideration

Question 22

what case does the 5th rule of consideration come from + explain

Answer 22

Pinnel’s case 1602 - a creditor can claim remainder of a debt even if creditor has agreed with debtor that a part payment of the debt will clear it

Question 23

what 2 cases can the rule from Pinnel’s case be seen in

Answer 23

Foakes v Beer
D&C Builders & Rees

Question 24

what did the law appreciate about Pinnel’s rule - and what was developed

Answer 24

that it was harsh - developed 3 exceptions

Question 25

what are the 3 exceptions to Pinnel’s case

Answer 25

1. debtor agrees to pay smaller amount on earlier date than originally agreed, then debtor has provided consideration for the new agreement
2. if x owes money to y, and z agrees to pay part of sum on behalf of x in full + final settlement, y cannot sue x for balance
3. the doctrine of PROMISSORY ESTOPPEL

Question 26

as in the 1st exception of pinnel’s case (debtor agrees to pay smaller amount on earlier date than originally agreed, then debtor has provided consideration for the new agreement) if the debtor agrees to accept something other than money for the whole debt, is this good consideration? explain even if…

Answer 26

yes - even if item not comparable in value to the debt as long as it is adequate

Question 27

what case does the 2nd exception of Pinnel’s rule (if x owes money to y, and z agrees to pay part of sum on behalf of x in full + final settlement, y cannot sue x for balance) come from?

Answer 27

Hirchand punamchand v Temple

Question 28

explain the 3rd eception to Pinnel’s case (the doctrine of promissory estoppel) + case

Answer 28

Central London Property Trust v High Street House: if 1 party to an existing contract (promisor) promises t vary contract for others benefit + the other relies on that promise to vary, promisor cannot go back on that promisor

Question 29

what case states that a person can only rely on promissory estoppel if he acted moerally

Answer 29

D&C Builders v Rees

Question 30

in what case did the court ignore promissory estoppel + held

Answer 30

Selectmore - held that Inland revenue could claim the whole debt

Question 31

what is the 6th rule of consideration + case

Answer 31

A promise to perform a duty which the law already demands be carried out is not sufficient consideration - Collins v Godefroy

Question 32

what case states that if a person goes beyond his legal duty then he can enforce the promise

Answer 32

Glasbrook Bros v Glamorgan County Council