A promise is not, as a general rule, binding as a contract unless it is either made in a deed or supported by some consideration To assess if there

is consideration one should ask:

What did you do for the other party, or what

did you suffer at his request that gives you the right to bring an action against him?

Currie v Misa (1875) court defined consideration as:

some right, interest, profit or benefit accruing

to one party or some forbearance, determent, loss or responsibility given, suffered or undertaken by the other

Example of forbearance as consideration Patel Brothers v H. D. Hasmani

X owed Y sh 27,000/=. Xs father agreed to

pay Y sh 18,000/= if Y did not sue X. A cheque was given t hat effect. Xs father h i to h t ff t X f th later claimed that Y had not done anything, given no consideration for the cheque given consideration cheque. The court of appeal decided in Ys favour that the forbearance to sue was good consideration for the cheque.

Executory Consideration
This is a promise to confer a benefit or to

suffer some detriment at a future time

Executed consideration
This is a completely performed obligation by

one party immediately the contract is entered into

Past consideration
This is executed before the contract is

entered into, generally it is not recognised to support a contract contract.

1.

Must be genuine and beyond what one is already bound to do. y

Obligations under a judgment Foakes v Beer

(1884)

Exceptions: Performance beyond once duty Glassbrook Brothers Ltd v Glamorgan County Council (1925) Change of circumstances that destroy the original contract, thereby freeing the parties from g , y g p the original contract Hartely v Ponsonby(1857) If a person who is already contractually bound promises t perform the same act for another i to f th tf th person Shadwell v Shadwell (1860)

Suppose that A arranges for B to clean As windows, and promises to pay B Kshs 500 for his work B does the work How does the work. work. analysis of benefit and detriment, apply in identifying the consideration supplied by B y g pp y for As promises of payment? As above, but this time A pays the Kshs 500 iimmediately, and B promises t clean th di t l d i to l the windows next Tuesday. What is the consideration for Bs promise? p Between the two scenarios which is executed and which is executory consideration id ti

2.

Consideration must be of some value but need not be shown to be economically adequate:
It is not the function of contract law to save a man

from fi f financially ruinous agreement H i ll i t Hassanali I li Issa and Co V Jeray Produce Shop Payment of smaller sum of money is not satisfactory of an agreement to pay a larger sum, even though the creditor agrees to take it in full discharge.
Exceptions E ti where the debtor at the creditors request makes an early payment; alters the mode of payment; or something different is paid and accepted by the creditor

3.

Consideration must be legal. For example, a promise given in consideration of an agreement to rob a id ti f tt b bank would be void because the consideration itself is illegal illegal. Consideration must move from the promisee. Generally only the parties to a g contract can enforce rights under the contract and they must have supplied consideration to each other. doctrine of privity of contract

4. 4

Exceptions to the doctrine of privity of contract

Actions by beneficiaries under a trust. A

beneficiary may sue under the trust himself th hi lf though not on the contract, h t th t t An assignee of contractual rights can sue in his own name name. A holder of a bill of exchange can sue in his own name name. A principal even if undisclosed, may sue on a contract made by agent

5. 6.

Consideration must be possible Co s de a o Consideration must not be past - A us o pas benefit given in the past cannot support a present p p promise. - Re: McArdle (1951) ( )
Exceptions Services rendered at the request of the promisor in such circumstances that the request implies a promise to pay a reasonable sum for the services rendered, the subsequent promise is binding. An action on a negotiable instrument can be supported b any antecedent d bt or li bilit t d by t d t debt liability

A time barred debt can be revived by a y fresh promise Estoppel - High Trees House Case (1947), s oppe g ees ouse ( 9 7),