In at its adequacy. The promise of service

In common law, consideration is concerned
with the arrangement of the contract. A contract is based on an exchange of
promises. Each party to a contract must be both a promisee and a promisor. They
must each receive a gain and each suffer a loss. Consideration must be of worth
that can be accurately determined, but the courts have the constantly refuse to
look at its adequacy. The promise of service in the future is just as suitable
a consideration of the service. So, that, the promisee has to give something in
return for the promise of promisor in order to change a bare assurance made in
his favors into a binding contract.

 

A definition by Sir Fredrick pollock
adopted by Lord Dunedin in Dunlop
Pneumatic Tyre Co., Ltd. v. Selfridge & Co., Ltd.: ” An act or
forbearance of the one party, or the promise thereof, is the price for which
the promise of the other is bought, and the promise thus given for value is
enforceable.”1

We Will Write a Custom Essay Specifically
For You For Only $13.90/page!


order now

 

This definition involves the idea that the
act or forbearance is something of value, something to which the law, in a
materialistic or practical sense, can attach value. The definition also
involves that the act or forbearance is bought, that it is done or suffered by
the one party at the request of the other; it is a matter of mutuality, not a
motive or emotion of affection, benevolence, bounty or charity which from their
nature must be personal to the promisor2

 

It was
explained in Currie v Misa(1875) A valuable consideration, in the sense
of the law, may consist either in some  right, interest, profit or benefit,
accruing to the one party, or some forbearance, detriment, loss or
responsibility, given, suffered or undertaken by the other.’3

Consideration must be sufficient
but need not be adequate  might feel like
an unfair method of determining a judgement but the ruling that was brought to
light in the case of Chappel v. Nestle 1960 where
Nestle ran a competition whereby if you sent in 3 chocolate bar wrappers along
with 1 shilling 6d then they would send you out a record, Chappel who
distributed these records felt that this de-valued the records and took a case
to prevent Nestle from running this, they were granted the injunction as it was
said that the 3 chocolate wrappers did not prove to be sufficient as Nestle did
not comply with s.8 of the Copyright Act of 1956. This was held as the wrappers
did provide a value despite them being thrown away they boosted sales which
meant under s.8 Nestle were required to inform consumers of the regular retail
price. If they were a mere token then they would have no value and Nestle would
be eligible to sell these records at the reduced price. This shows that not
everything has to be valued in terms of money.4

In the case of Hartley v Ponsonby (1857) 5the
court said this promise was enforceable: the crew was so reduced that it was
dangerous to sail on and the captain would have had no right to demand it. The
original contract had come to an end, and the seaman were free to make a new
contract on whatever terms might be agreed.6

 

Past Consideration is Not
Good Consideration something promised afterwards cannot count as consideration.
In Roscorla v Thomas1842  An agreement for
the purchase of a horse had been completed between buyer and seller. Following
the completion of the contract, the seller made a warranty that the horse was
“free from vice”. Upon delivery, it was discovered by the buyer that
the horse was vicious in behaviour.  Lord
Denman CJ delivered the judgement of the Court.

“It may be taken as a general rule, subject to exceptions not
applicable to this case, that the promise must be coextensive with the
consideration… a consideration past and executed will support no other
promise than such as would be implied by law.”

The Court found for the defendant because his promise was unsupported by
consideration. The consideration for the soundness warranty had already been
made through the original contract of sale, and so new consideration would have
had to be provided for the warranty to have legal effect. This decision
demonstrates the rule in English contract law that consideration contracted for
in the past does not amount to good consideration for a present agreement.7

Performance of a duty enforced by law does not
constitute good consideration. In Collins
v Godefrey ,Godefrey promised to pay Collins for his giving of evidence. It
was held that Collins could not enforce the promise as he was under a statutory
duty to give evidence in any event.8

However, where the individual does more than
legally required this can be sufficient consideration. In Ward v Byham a mother was under a statutory duty to look after her
child. The ex-husband promised to pay her £1 a week if she ensured that the
child was well looked after and happy. It was held that notwithstanding the
statutory duty imposed on the mother, she could enforce the promise since the
act of keeping the baby ‘happy’ provided additional consideration.9

Part-payment of a debt is not good
consideration, but part-performance of an existing contractual duty is good
consideration. If a person pays less than the initial amount which was agreed upon then
new consideration is required. This may also come in the form of additional
consideration along with the original agreement. If this is not adhered to then
the contract will be voided

regardless of a creditors agreement to accept
less than the initial settlement unless something new has been given as
consideration to the agreement.

In Pinnel’s Case it was held paying a smaller
sum of an entire debt was not good consideration since the debtor was only
doing what he was already legally entitled to do. Pinnel’s case16 where Cole owed Pinnel £8 10s.
Pinnel requested that Cole paid £5 2s 6d. a month before the full payment was
due. It was then claimed by Cole that it was agreed upon that the rest of the
payment was cleared as he had paid the advance to Pinnel. The court held that
Pinnel could not claim the rest of the debt. While they admitted that part
payment of a debt of the original debt was not good consideration and didn’t
constitute a waiving of the balance. However, Pinnel did benefit from the
advance of the payment which the courts did deem to be good consideration. The
court stated:

“Payment of a lesser sum on the day in
satisfaction of a greater sum cannot be any satisfaction for the whole, because
it appears to the Judges that by no possibility, a lesser sum can be a
satisfaction to the claimant for a greater sum…”10

If,
whatever a man’s real intention may be, he so conducts himself that a
reasonable man would believe that he was assenting to the terms proposed by the
other party, and that other party upon that belief enters into the contract
with him, the man thus conducting himself would be equally bound as if he had
intended to agree to the other party’s terms11

1 POLLOCK, F. and Winfield, P. (1950). Pollock’s Principles of
Contract. Thirteenth edition by Sir Percy H. Winfield, etc. Pp. xliii. 610.
Stevens & Sons: London, p.145.

2 Harvard Law Review, Vol. 49, No. 8 (Jun., 1936), pp. 1225-1253

3 Currie v. Misa 1875 LR 10 Ex 153

4 Chappel v Nestle 1960AC 87 House of Lords

5 Hartley v Ponsonby 1857 EngR 605; 119 ER 1471; (1857) 7 E & B
872.

6 Finch, E. and Fafinsky, S. (2015). Law express. 4th ed. Pearson,
p.44.

7 Roscorla v Thomas 1842 EWHC J74, (1842) 3 QB 234.

8 Collins v Godefroy 1831 EWHC J18, (1831) 1B & Ad 951; 109 ER
1040.

9 Ward v Byham 1956 EWCA 1, 1956 1 WLR 496.

10 Pinnel’s Case 1602 5 Co. Rep. 117a

11 Smith v Hughes (1871) LR 6 QB 597

Author:

x

Hi!
I'm Eileen!

Would you like to get a custom essay? How about receiving a customized one?

Check it out