U2 Flashcards
what is consideration?
The something in return, so in order to be able to hold the other party to a promise you must have agreed to provide something in return for that promise
does past consideration usually count as consideration?
not usually
what are the three types of existing duty
- Existing duty imposed by law
- Contractual obligation owed to a third party
- Contractual obligation owed to the other contracting party
what os the overall rule to do with part payment of undisputed debts?
part payment of debt is not usually consideration for a promise (Pinnel’s Case 1602)
what are some common law exceptions to part payment of undisputed debts?
- If the debtor can show they gave something different for the creditor’s agreement to accept less than the original sum [Pinnel’s Case 1602]
- If the part payment of debt is by a third party, then the principle that part payment is not good consideration does not apply
what is promissery estoppel
o A creditor may be prevented (estopped) from going back on a promise to accept part payment if in all the circumstances it would be fair to do so
what is the general idea of Promissery estoppel?
o If you have made a promise not to enforce your legal rights; and
o The promisee has relied on that promise even though they haven’t provided anything in return; then
o If you try and enforce your legal rights you will be estopped if it would be inequitable (unfair)
what are the 4 conditions for promissery estoppel to apply?
- There must be a promise to forgo legal right [eg accept reduced rent] which is intended to be acted upon by the other party
- The promisee must act on the promise [eg pay the reduced rent]
- Promissory estoppel doesn’t give rise to a cause of action, only used as a defence
- It must be inequitable or unjust for the promiser to go back on their promise and insist full legal rights
what is privity of contract?
-Only a contracting party can sue for breach of contract, or otherwise liable for breach (only the actual parties to a contract are bound by it, so have no rights and obligations by it)
what is agency
-Relationship which arises where someone (AGENT) acts on behalf of another and has power to affect THE PRINCIPAL’S legal position with regard to a third party