Consideration

Question 1

What is consideration?

Answer 1

Something in return for that promise which can be a promise or an act.

Question 2

Bilateral contracts include a promise for a

Answer 2

promise

Question 3

Unilateral contracts include a promise for an

Answer 3

act

Question 4

Does consideration need to be adequate?

Answer 4

No, it can be £1 for a car

Question 5

What is past consideration?

Answer 5

This is when something was done gratuitously and not in return for anything

Question 6

Is past consideration good consideration?

Answer 6

No unless exceptions:
1. past act done at the promisors request
2. mutual understanding there would be compensation
3.had the promise been made in advance it would be legally enforceable

Question 7

Is performance of an existing contractual duty owed to the other party consideration for extra payment?

Answer 7

No

Question 8

However, is exceeding a contractual duty owed to the other party consideration for extra payment?

Answer 8

Yes, if it confers a practical benefit [unless duress]

Question 9

If someone owes you money and you agree to accept a smaller amount as part payment, this is not legally binding. What does there need to be as well for it to be legally binding?

Answer 9

Something different than just part payment such as: payment earlier, something of a different nature.

Question 10

Dr. Foakes owed Mrs. Beer money and interest. They agreed he could pay the debt in installments, and she wouldn’t pursue the interest. Later, she sued for the interest. Can she?

Answer 10

Yes, The court applied Pinnel’s Case. Dr. Foakes paying the debt in installments was not considered new consideration for Mrs. Beer’s promise to forgo the interest. She was entitled to the interest.

Question 11

What is promissory estoppel?

Answer 11

This can be a defence that can stop the creditor from going back on their promise even without consideration.

Question 12

Can a creditor claim back payments for the period they agreed to a reduced payment under promissory estoppel?

Answer 12

No, a creditor cannot claim back payments for the period they agreed to a reduced payment.

Question 13

Q8: Can a creditor resume their right to full payment after a period of reduced payment under promissory estoppel

Answer 13

A8: Yes, a creditor can resume their right to full payment going forward by giving reasonable notice.