Consideration Flashcards
An expression of willingness of a contract on certain terms and wholehearted acceptance of an offer that the offeree knows is being made
Allied Marine
Currie v Misa Consideration definition
Either a benefit to a person receiving, or detriment to other, or both
3 P’s from Pollock (Consideration)
The price you pay for another’s promise
Consideration need not be adequate, but must be sufficient
Chappell v Nestle
Consideration must have some economic value
Thomas v Thomas
Forebearance (promise not do something) is not good consideration, due to public policy issues (floodgate rule)
White v Bluett
Possible exception to Forebearance rule if it involves giving up one’s legal rights
Hamer v Sidwar
US Case
Past consideration is not good consideration (general rule)
Roscorla v Thomas
Possible exception to ‘past consideration is good consideration’ rule if:
The act was carried out at the promisor’s request
Lampleigh v Brathwait
Possible exception to ‘past consideration is good consideration’ rule if:
The parties understood from the beginning that the act was to be rewarded in some way
Re Casey’s Patents
Performance of existing contractual obligation is not good consideration for a promise to pay more
Stilk v Myrick
Possible exception to Stilk v Myrick:
If A exceeds duties or confers extra benefit to B
Hartley v Ponsonby
Williams v Roffey
Criteria for possible exception to Stilk v Myrick
- contract for goods/services in return for payment;
- B doubts whether A will complete his obligations;
- B promises additional payment if A completes obligations on time;
- As a result, B obtains a practical benefit or obviates a disbenefit
- Promise not given as a result of economic duress or fraud
A promise to do something can amount to consideration even if the promisor is already bound to perform obligation by another party
Scotson v Pegg
Part payment of undisputed debts is NOT good consideration for a promise by creditor to forgo balance
Foakes v Beer
Exception to Foakes v Beer:
Pinnel’s Case
Part payment is good consideration if debtor gives something different or pays early
Exception to Foakes v Beer:
Promissory Estoppel
Promise Reliance Inequitable Defence Effect
Promissory estoppel
Promise - Must be a promise to waive a legal right, which must be intended to be acted upon by other party
Hughes v Metropolitan Rail
Promissory estoppel
Reliance - promisee must act upon promise, altering their position
Alan v El Nasr
Promissory estoppel
Inequitable - Must be inequitable for promisor to go back on promise
D&C Builders v Rees
Promissory estoppel
Defence - Shield not a sword, so will not give rise to cause of action
Combe v Combe
Promissory estoppel
Effect - Effect of PE is to extinguish or suspend legal rights.
Can recommence on reasonable notice
High Trees
Promissory estoppel
In cases were promisee cannot resume original position, promissory estoppel may operate to permanently extinguish the promisor’s legal rights
Ajayi v RT Briscoe
Performance of one’s public/legal duties is NOT good consideration
Collins v Godefroy
Exception to Collins v Godefroy:
If not contrary to public policy
Williams v Williams
Exception to Collins v Godefroy:
If public duty is exceeded
Glassbrook Bros v Glamorgan