Explain doctrine of consideration

The doctrine of consideration both expressed that fact, and attempted to define what that something else had to be before an assumpsit claim could be brought. The doctrine that a consideration is necessary if a contract is to be enforceable has a number of functions in the law of contracts. This chapter examines the role of the doctrine of consideration in the emergence of the action of assumpsit in england. A commonlyrecognized exception to the foregoing rule is the socalled unforeseen difficulties doctrine, which permits an existing. According to section 2d of indian contract act, consideration. Williams, we must first establish the premises of consideration under which this case fell, and then the outcome, and subsequently the impact of this case on the entire doctrine of consideration. This is inscribed in legal doctrine, in the principles that contracts are created through offer, acceptance, and consideration. Consideration definition is continuous and careful thought. Promissory estoppel and how it solved the problems arising from the rule. In common law it is a prerequisite that both parties offer consideration before a contract can be thought of as binding. Consideration must be sufficient not adequate this means it needs to be something of value to the other person but how much it is is not the business of the court. If there is more than one creditor, and each one agrees, in consideration of the others agreement, to accept full settlement a percentage of the amount due, this agreement will cancel the unpaid balance due to these creditors. Holmes rather stringent interpretation of the consideration doctrine was rejected by both restatements, which define consideration in broader terms. Another observation that i agree with is the broader concept of public policy.

It is the price for which the promise of the other is bought law of contract, pg 60. The doctrine of consideration protects the promisees reliance, eg forbearance to sue. Most often, services or goods are exchanged or promised in a contract, though consideration may be whatever the parties agree to. The idea of consideration 243 why, then, is consideration so difficult for contract theory. The concept has been adopted by other common law jurisdictions, including the us. This definition, however, leaves unanswered the question of what is sufficient. The doctrine of consideration has been a basis for a considerable discussion over many years. As defined by sir frederick pollock, consideration is an act or forbearance of one party, or the promise thereof, is the price for which the promise of the other is. Consideration is the agreed equivalent and inducing cause of the promise pg 119, contract law purple book. The court in currie v misa declared consideration to be a right, interest, profit, benefit, or forbearance, detriment, loss, responsibility.

Thus, consideration is the price for which the promise of other is bought. Consideration which means the value is used in exchange of value. Promissory estoppel legal definition of promissory estoppel. In simple terms, consideration is the basic reason a party enters into a legal contract. Explain the relevance of consideration to the formation of a legally binding agreement. In this video we discuss consideration, one of the elements of a contract along with offer and acceptance. Consideration definition, examples, types, in contract law. The origins of the modern doctrine of consideration are to be found in the judgment of lush j in currie v misa 1875 lr 10 ex 153, where he described consideration as. Explain the rule known as the rule in pinnels case and.

Though a partial payment of the debt does not constitute a good consideration of the contract. Oct 27, 2015 consideration consideration is quid pro quo that is something in return. Therefore, the doctrine of consideration should undergo certain reforms, but it should not be completely abolished. Explain the doctrine of consideration in the context of. Sep 12, 2015 consideration in a contract is the exchange of anything of value by each party. The second exception to the rule that a promise based on moral or past consideration is unenforceable is a promise to perform a voidable obligation. A valid contract must include consideration for every party involved. In 1937, the doctrine of consideration was under appraisal by the english law revision committee. In a bilateral contractan agreement by which both parties exchange mutual promiseseach promise is regarded as sufficient consideration for. In order for consideration to provide a valid basis for a contract and remember that every valid contract must have consideration each party must make a change in their.

The doctrine of consideration law essays essay sauce free. Consideration is an english common law concept within the law of contract, and is a necessity for simple contracts but not for special contracts by deed. Consideration can be anything of value such as an goods, money, services, or promises of. Executed consideration is an act in return for a promise. Modern contract theory has also permitted remedies on alternate theories such as promissory estoppel. Under classical contract theory, consideration is required for a contract to be enforceable. Consideration may consist of some interest, right, benefit or profit accruing to one party. Explain the doctrine of consideration in the context of bargain theory and economic liberty. In most cases, consideration is an important component of contracts.

Consideration must be sufficient not adequate this means it needs to be something of value to the other person but how much it is. Traditionally, the doctrine of consideration has been defined as either a detriment to the promisee or a benefit to the promisor. Is essential to every simple contract, can be present and future but not past. Consideration in contract meaning, need, kinds the term consideration is used in the sense of quid proquo something in return. However, a stranger thirdparty to consideration is different from a stranger to a contract. In the law of contracts, the doctrine that provides that if a party changes his or her position substantially either by acting or forbearing from acting in reliance upon a gratuitous promise, then that party can enforce the promise although the essential elements of a contract are not present. What is the doctrine of consideration essay example. For a promise set out in an agreement to amount to a breach of contract if it is not carried out, the promise must be supported by consideration. Because the history of the doctrine has many layers, those who have attempted to study it from the perspective of their own age have often been misled.

Dialogue about the doctrine of consideration scholarship. Indeed, no basic contract doctrine has proved more intractable to theor etical justification than consideration. The consideration doctrine, regarded by many as the centerpiece of contract law, has produced a vast literature and intense controversy. Doctrine of consideration in contract law upcounsel. It may consist of a promise to perform a desired act or a promise to refrain from doing an act that one is legally entitled to do. Hence, the doctrine of consideration is diluted in the case of williams v roffey as it erodes the general rule that there is insufficient consideration when the promisee performs the existing contractual duty owed to the promisor. Consideration is a central concept in the common law of contracts. The doctrine of consideration is irrelevant in many jurisdictions, although contemporary commercial litigant relations have held the relationship between a promise and a deed is a reflection of the nature of contractual considerations. If it is done without his request or at the request of a third party, it will not be a valid consideration. Doctrine of consideration introduction oxford scholarship.

The doctrine of consideration requires that every contract must be supported by some form of consideration. Despite its shortcomings, it simply cannot be replaced outright. The position adopted was a consequence of the doctrine of consideration. This view was upheld by 18th and 19th century courts, with the development that the courts were willing to treat even a slight benefit in the. What is the doctrine of consideration essay sample. Although the doctrine of consideration is unique to common law, these functions.

Dec 22, 2019 regardless of the form of consideration required in a contract, a consideration is needed in order to make an agreement or promise legally enforceable. It is very simple that unless a person offers to do something, how can he be made liable to pay for that. It also examines the problems arising from the rule in pinnels case, the subsequent exceptions that were developed to circumvent the rule and in detail the most important exception of them. Even if it has value to the parties themselves, it must. The doctrine of consideration the doctrine of consideration is defined by sir frederick pollock as an act, or promise, of the price in which the other party is bought, and the entire agreement is then enforceable. To discuss further, feel free to send me an email and to comment. Yet, none of these excellent and informative articles adequately explain the normative and functional roles of consideration once the focus on consideration is expanded to explore and explain related doctrines and cases. Consideration is a concept of english common law and is a necessity for simple contracts but not for special contracts contracts by deed. The law insists on the existence of consideration if a promise is to be enforced as creating legal obligations. The second amendment made to the consideration doctrine is the practical benefit rule.

This is where x has a claim against y, x provides consideration for ys promise if x. Consideration definition of consideration by merriamwebster. The first important rule of consideration is that the act or forbearance must be done at the desire or request of the promisor. This lesson will teach you what constitutes consideration in business law. The use of the term in scripture, however, is broader than a simple reference to information passed on from one person to another or from one generation to the next. Traditionally, the doctrine of consideration is defined as either a benefit to the promisor or detriment to the promisee.

The promise was made by both parties who mutually agreed to the promise. Basic understanding of consideration does something in the past, present or future or abstains from doing something in the past, present or future. If the amount of the debt is in dispute, the debt is canceled if a lesser sum than that claimed is accepted in full settlement. Indeed, the initial rule, as defined in the pinnels case. Consideration must move at the desire of the promisor. Mar 31, 2014 the doctrine of consideration can therefore be seen as a set of rules, which play the principal role in the decision by the courts as to which agreements or promises are found to be legally binding. The doctrine of consideration and promissory estoppel is a term used in contract law that deals with the bargaining conditions of the contract. Consideration in contract law is simply the exchange of one thing of value for another. Must promise more than a current or existing obligation.

It establishes the time at which the action of assumpsit became associated with the doctrine of consideration and discusses the essential features of the doctrine during the 16th and 17th centuries. This holds true for all the main theor etical perspectives, however much they may odierwise differ among themselves. I have argued that the doctrine of consideration originated in. Promises made in return for acts or events that have already taken place are unenforceable for lack of sufficient consideration. This promise is enforceable despite the absence of new consideration so long as the new promise is not subject to the same defense that made the original obligation voidable. Therefore, the doctrine of consideration should undergo certain reforms, but it. It is one of the six elements that must be present for a contract to be. Its origins are still shrouded in mystery, and its functions, of which there are many, are illdefined. Consideration is an essential element for the formation of a contract. Download file to see previous pages in order to critically asses the requirement of the proposition at hand, i. Secondly, the doctrine of consideration has since long been established in common law, and is a recognized chapter in all law textbooks. Distinguish between the concepts of adequate and sufficient consideration and apply this distinction to hypothetical fact situations. In the legal system, the term consideration in contract law refers to something of value given to someone in return for goods, services, or some other promise.

In order for an agreement to become a legally binding contract, the common law position is that there must either be a formalised deed or some form of consideration between the parties. The doctrine of consideration both expressed that fact, and attempted to define what that something else had to be before an assumpsit claim. It discusses the details of the earliest example of a case involving. That being said, because the court system aims to achieve fairness, a legal forum will apply the doctrine of promissory estoppel in situations where a consideration is made. The doctrine of promissory estoppel is the exception to the rule.

If it is the performance of the first promise, then each arises and becomes. The promise must be supported by the consideration, and it only can be if. Explain how the doctrine of promissory estoppel is an exception to the rule that consideration is required before the law will enforce a promise. If there is no element of consideration found, there is thus no contract formed. The doctrine of consideration is important in all contracts, as it refers simply to an agreement that is legally enforceable. In spite of all that has been written and said in explanation of the doctrine of consideration, the law is still far from clear. The concept of consideration has been adopted by other common law jurisdictions, including the us. The consideration portion of a contract is the price that is promised to be paid in return for the items provided under the contract. This essay examines the rule knows as the rule in pinnels case and how it impacted upon the doctrine of consideration. This is explained through the doctrine of privity of a contract.