Consideration

Question 1

What was defined in Currie v Misa?

Answer 1

Consideration is defined as “some benefit accruing to one party or some detriment suffered or undertaken by the other”

Question 2

What are the general rules for consideration?

Answer 2

1. Must be sufficient.
2. Need not be adequate.
3. Past consideration is no consideration.
4. Consideration must move from the promisee.

Question 3

What does it mean by ‘consideration must be sufficient’?

Answer 3

Must be real (exists) and valuable (has some value)

Question 4

What was held in White v Bluett?

Answer 4

There was nothing of value and so consideration was not sufficient

Question 5

What does it mean that ‘consideration need not be adequate’?

Answer 5

The bargain does not need to be a good bargain. They don’t need to be in agreement whether something is valuable

Question 6

What was held in Chappell v Nestle Co?

Answer 6

The chocolate wrappers were part of the consideration and could have been consideration on their own, there didn’t need to be an additional payment

Question 7

What does it mean by ‘past consideration is no consideration’?

Answer 7

Consideration has already been done before the agreement was made and it can’t be used as basis for a later promise

Question 8

What was held in Re McArdle?

Answer 8

There was no contract because the promise was made after the work had been completed

Question 9

What is the doctrine of implied asumpsit?

Answer 9

An exception to ‘past consideration is no consideration’ as there is an implied understanding that the task will require payment

Question 10

What was held in Lampleigh v Brathwait?

Answer 10

Actions were important and so there was an implied fee

Question 11

What was held in Re Casey’s Patent?

Answer 11

There was an implied understanding that the claimant would receive payment for work on the patents

Question 12

What are the requirements for implied asumpsit?

Answer 12

• Express or implied request by A to B to perform the task
• Implied promise that A will pay B a reasonable amount for the performance
• B performs task
• A pays B for performance

Question 13

What does it mean that consideration must move from the promisee?

Answer 13

A person can not sue or be sued under a contract unless they have provided consideration for it

Question 14

What was held in Tweddle v Atkinson?

Answer 14

The husband cannot sue because he had given no consideration and was not a party in the agreement

Question 15

What are pre-existing duties?

Answer 15

If A and B have a pre-existing contract, performance under that contract will not amount to consideration for the second contract (unless there is something extra required)

Question 16

When are pre-existing duties relevant?

Answer 16

When:
- There is an existing contract with A.
- There is an existing contract with C, a third party
- There is an obligation imposed by law

Question 17

What was held in Collins v Godefoy?

Answer 17

Lord Tenterden CJ held that as C was imposed by law to give evidence, money paid to him was not consideration

Question 18

What was held in Stilk v Myrick?

Answer 18

Despite the captain’s promise, they agreed to do anything in emergency situations and so there was no consideration for additional money

Question 19

What was held in Hartley v Ponsonby?

Answer 19

A promise to make further payment was sufficient consideration because the voyage was dangerous

Question 20

What were Glidewell LJ’s guidelines in Williams v Roffey Bros and Nicholls?

Answer 20

1. Agreement between A and B
2. B doubts A will complete obligation
3. B promises extra payment if A completes on time
4. B obtains a benefit or obviates a disbenefit
5. B’s promise is not given under economic duress or fraud
6. The promise is legally binding if the promise to B is beneficial