Week 5 - Rules Governing Consideration Flashcards
What is the first rule governing consideration?
Consideration must not be past - doing a nice gesture and then demanding money after doing it
What are the exceptions to the first rule governing consideration?
If the act was done in response to a request
What is the second rule governing consideration?
Consideration must be sufficient but need not be adequate
What does sufficient mean in law?
Must be real, tangible and have some recognisable value
What does adequate mean in law?
Must be of roughly equal value to the other parties’ consideration
What is the third rule governing consideration?
Performing an existing duty cannot be good consideration
a) performing a public duty
b) performing a contractual duty
When is the third rule governing consideration ignored?
If the person is going above and beyond their duty
You cannot have consideration that’s already been agreed in a contract that changes some way and the consideration stays the same UNLESS
Unless the defendant receives some extra benefit
Which case covers fresh consideration and how?
Roffey bros Ltd vs Williams (1990)
- Williams needed more money to do the flats - his fresh consideration helping RB avoid the penalty clause
- Roffey Bros paid more cash = their fresh consideration
What are the three exceptions to consideration (what bit idk)?
- where the party promises to exceed their existing duty
- unless defendant would receive some extra benefit
- part payment of a debt
What is the rule from Pinnel’s case?
Agreement to accept lower sum is not binding unless supported by fresh consideration
What are the four exceptions to the rule from Pinnel’s case, under the principle of accord and satisfaction?
- agreeing to accept lower sum paid earlier
- agreeing to accept something other than money
- agreeing to pay in a different way
- promissory estoppel
