Consideration

Consideration

1. Exchange of promises

   • A contract is only legally enforceable if it contains 'consideration'
     • Exchange of values: essentially it refers to what one party is giving or promising, in exchange for what is being given or promised from the other side.

2. Benefit and Detriment

   • Consideration requires benefit and detriment. CURRIE V MISA
     • What is provided by way of consideration should be a benefit to the person receiving it, or a detriment to the person giving it.
       • Benefit to one party, or detriment to the other will be enough.

3. Consideration is required in 2 circumstances:

   • 1. Forming a contract
   • 2. Where the parties seek to vary or alter an existing contact.

4. Consideration principles:

   • 1. Consideration must be sufficient but not adequate
     • 'Sufficient' - Whether what is being offered is recognised as sufficient in law.
     • 'Adequate' - Something which is of equal value to the thing given in exchange.
   • 2.Consideration must move from the promisee (the recipient).
   • 3. Consideration may be executory or exectued, but not past.
     • Consideration is said to be 'executory' when it is present in an exchange of promises and 'executed' when it is a promise in return of an act.

5. SHADWELL V SHADWELL

   • Uncle promised P a money if he married E (already in engaged). P married, D refused to pay.
     • HELD: Uncle derived a benefit from P's change of status. Consideration found.

6. TWEDDLE V ATKINSON

   • 2 Prospective fathers in laws promised each other to give money to groom when he was married. One father-in-law refused and on death the groom sued his estate.
     • HELD: groom could not sue, as he gave nothing for the promise.

7. CHAPPELL V NESTLE

   • Customers sent in wrappers for tokens.
     • HELD: Sending in wrappers increased sale of chocolate. Consideration found.