Consideration

Question 1

What is the definition of consideration in contract law?

Answer 1

Something of value that is exchanged between parties as part of the contract

(Currie v Misa, 1875)

Question 2

What does ‘consideration must be sufficient but need not be adequate’ mean?

Answer 2

Consideration must have some value but does not need to be a fair trade.

(Thomas v Thomas)

Question 3

What does ‘the consideration must move from the promisee’ mean?

Answer 3

Only the person who gives consideration in a contract can enforce it.

(Tweddle v Atkinson)

Question 4

Why can’t existing contractual duties count as consideration?

Answer 4

If you’re already legally required to do something, you can’t use that as new consideration for another promise.

(Collins v Godfrey)

Question 5

Why is part payment of a debt not considered valid consideration?

Answer 5

, paying only part of it does not count as a new deal to clear the whole debt.

(Pinnel’s Case)

Question 6

What is the exception to part payment of a debt not being consideration?

Answer 6

If a third party pays part of a debt, it can still be valid consideration.

(Hirachand Punamchand v Temple)

Question 7

What is promissory estoppel?

Answer 7

It stops someone from going back on a promise if the other party relied on it and it would be unfair to break the promise.

(Tool Metal Manufacturing)

Question 8

Why must consideration not be past?

Answer 8

Something already done in the past cannot be used as consideration for a new promise.

(Re McArdle, 1951)

Question 9

What is the exception to the rule that past consideration is not valid?

Answer 9

If someone does work at the request of another, and it is understood that they will be rewarded, a later promise to pay for that work can be enforced.

(Re Casey’s Patents)