An Agreement That Lacks Consideration Is Said To Be

A promise to pay part of a debt is not a sufficient counterpart to pay a larger debt. This is because there is no new counterpart for paying a smaller amount of money. For example, a buyer of goods who has paid £10 in the past. This is not a good counterparty for the delivery of new goods to conclude a new contract. In any event, if the promisor provides what he was obliged to do under public law, the promised fulfilment of the existing obligation is in any event not a good consideration. At Collins vs. Godefrey, Godefrey promised to pay Collins for his testimony. It was found that Collins failed to keep his promise, as he was in any event subject to a legal obligation to testify. [21] “Past consideration is not a consideration”: the recital must be “executory” or “executed”, but not “not”, In other words, the consideration must be made in the present or in the future, but things that are done before cannot be a good consideration. [6] The special word “consideration” in contract law refers to something that has value in the eyes of the law. It is consideration that has been provided in the past and not at the time of conclusion of the contract. On the other side of the coin, the illegal quid pro quo could be a promise not to do something to which a party is legally required to pay taxes, for example.B.

or to satisfy a legal requirement. For this reason, consideration may be insufficient from a commercial point of view, but for legal purposes: similarly, if a party is already legally required to do something, it cannot be a new consideration either. A commitment to fulfil an existing contractual obligation towards a third party (as opposed to the fulfilment of that obligation) may also constitute consideration. [17] Nor is the promise to honour an obligation already owed to the contractor a good consideration. [23] However, this rule has been considerably limited by recent case law. The general rule is that when a creditor promises to pay a debt against a fraction of the payment by paying the agreed portion, the commitment is not in return for the promise, since it is only the partial performance of a contractual obligation already due. [24] [25] Therefore, the debtor remains liable for the entire amount, as it cannot force the promisor to accept less. A prominent example is Stilk v Myrick, where Stilk, a sailor, agreed with Myrick to sail his boat for £5 a month to the Baltic Sea and back. During the trip, two men deserted.

Myrick promised that he would increase Stilk`s salaries if Stilk agreed to abide by his contract, given the desertions. Stilk agreed, and when Myrick returned to port, he refused to pay him the extra salaries. It was found that Myrick`s new promise was unenforceable, because the quid pro quo stilk had provided for that purpose, the fulfillment of a duty he already contractually owed to Myrick was not a good counterpart to Myrick`s promise to increase his salaries. [26] Reciprocity of consideration is fundamental to contract law. The consideration must be real or sufficient in the sense that it has economic value. Where is the new thinking? If the consideration does not pass from the employer in support of the new version, the amendment (a “presumed change”) is likely not valid or enforceable. When an employer insists that the new contract be fulfilled – for example, it is a reduction in wages or less favourable working conditions – it may be a negative breach of contract or a constructive termination. Do you have a problem with a contract that you can solve? Does a technical point of contract law in your contract make you stop in what you want to do? But if the promise offers more than what public duty imposes on it, it is a good reflection.

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