Consideration Flashcards
Valuable consideration “may consist either in some right, interest, profit, or benefit accruing to the one party, or some forbearance, detriment, loss, or responsibility given, suffered, or undertaken by the other.”
Currie v Misa [1875]
Past Consideration is not good consideration. There must be a causal link between the promises of the parties.
Roscorla v Thomas [1842] 3 QB 234
Re McArdle [1951] Ch 699
Exceptions to the past consideration is not good consideration rule: - Where services are rendered upon request.
Lampleigh v Braithwait [1615] Hob 105
Re Casey’s Patents [1892] 1 Ch 104
Pau On v Lau Yiu [1980] AC 614
Statutory exceptions to the past consideration is not good consideration rule:
Limitation Act 1980 s 29(5)
Bills of Exchange Act 1882 s 27
Consideration must move from promisee but not necessarily to promissor. Only a person who has provided consideration can bring an action to enforce the contract
Price v Easton [1833] 4 B & Ad 433
Tweddle v Atkinson [1861] 1 B & S 393
Exceptions to the rule that only a person who has provided consideration can bring an action to enforce the contract
Contracts (Rights of Third Parties) Act 1999
Collateral contracts – see also Doctrine of Privity (Part VI)
Consideration must be sufficient but not necessarily adequate. Must be something of value in the eyes of the law. Natural love and affection is not sufficient.
White v Bluett [1853] 23 LJ Ex 36
Hamer v Sidway [1891] (USA)
Consideration must be sufficient but not necessarily adequate. Need not be of an equal economic or commercial value to that provided by the other.
Thomas v Thomas [1842] 2 QB 851
Chappell & Co Ltd v Nestle Co Ltd [1960] AC 87
Performance of existing obligation is insufficient consideration - public duty imposed by law
Collins v Godefroy [1831] 1 B & Ad 950
Glassbrook Bros v Glamorgan County Council [1925] AC 270
Harris v Sheffield United Football Club Ltd [1988] QB 77
Performance of existing obligation is insufficient consideration - Existing contractual obligations owed by claimant to defendant.
Stylk v Myrick [ 1809] 2 Camp 317
Hartley v Ponsonby [1857] 7 E and B 872
Williams v Roffey Bros & Nicholls (Contractors) Ltd. [1990] 1 All ER 512
Performance of existing obligation is insufficient consideration - Existing contractual obligations owed to third parties
Scotson v Pegg [1861] 6 H&N 295
New Zealand Shipping v Satterthwaite (The Eurymedon) [1974] 1 All ER 1015
Discharge of existing financial obligations (repayments of debts). Payment of a lesser sum than what is due on the day it is due is not satisfaction for the whole debt.
Pinnel’s Case [1602] 5 Co Rep 117a
But the following may amount to consideration:-
(i) payment of a lesser sum before the date due at the creditor’s request
(ii) payment of a lesser sum at a different place at the creditor’s request, and
(iii) payment in kind or a lesser sum and payment in kind at the creditor’s request.
Foakes v Beer [1884] 9 App Cas 605
D and C Builders v Rees [1966] 2 QB 617
Welby v Drake [1825] 1 C & P 557
Re Selectmove Ltd [1995] 1 WLR 474
If one party to an existing relationship, intending legal consequences, promises not to insist upon his strict legal rights arising from the relationship, and the other party to the relationship changes his position in reliance upon that promise, then the promisor will be estopped from going back upon his promise, even though he has received no consideration for his promise. However,…..the promisor can withdraw from his promise on giving reasonable notice, which need not be formal, and the promise becomes final and irrevocable only of the promisee is unable to resume his original position.
Central London Property Trust v High Trees House [1947] KB 130
Hughes v Metropolitan Railway [1877] 2 App Cas 439
Tool Metal v Tungsten Electric [1955] 1 WLR 761
Estoppel is a shield not a sword
Combe v Combe [1951] 1 All ER767
