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.
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.
Consideration is required in 2 circumstances:
1. Forming a contract
2. Where the parties seek
to vary or alter an existing
contact.
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.
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.
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.
CHAPPELL V NESTLE
Customers sent in wrappers for tokens.
HELD: Sending in wrappers increased sale of chocolate.
Consideration found.