Formation Of A Contract - Consideration

Question 1

What is consideration?

Answer 1

Something of value that both parties must give
Curie v Miss : “Some right, interest, profit or benefit”

Question 2

What is the first rule of consideration?

Answer 2

Consideration must be sufficient, but need not be adequate
-both parties must include something of value
-not for the courts to interfere if one party made a bad bargain
-consideration must be real

Case : Chappel v Nestle

Question 3

What is the second rule of consideration?

Answer 3

Past Consideration
-Not valid consideration
-no value before an agreement

Case : Re McArdle (past consideration has no value

EXCEPTIONS
1. Implied promise to pay (Re Casey’s Patent)
2. Importance (Lampleigh v Braithwaite)

Question 4

What is the third rule for consideration?

Answer 4

Performing a Pre-Existing Duty?
-if you perform something that is already required, it wont be considered consideration.

Case : Stilk v Myrick (performed what they were contracted to do so they weren’t entitled to consideration)

EXCEPTIONS
1. Extra element (more than what you are contracted to do)
Case: Hartley v Ponsonby
2. To avoid a detriment (consideration would be provided)
Case: Williams v Roffey