What is the definition of consideration in contract law?
Something bargained for and received by a promisor from a promisee. Common types of consideration include real or personal property, a return promise, some act, or a forbearance. Consideration or a valid substitute is required to have a contract. business law. contracts.
What is an example of consideration in a contract?
Anything of value promised by one party to the other when making a contract can be treated as “consideration”: for example, if A signs a contract to buy a car from B for $5,000, A’s consideration is the $5,000, and B’s consideration is the car.
What do you mean by consideration?
Something of value given by both parties to a contract that induces them to enter into the agreement to exchange mutual performances. Consideration is an essential element for the formation of a contract.
What is the doctrine of consideration?
Consideration can be loosely defined as a price for which a promise is bought. … With the doctrine of consideration, it ensures that both parties will benefit from the contract, and that there will be a lower possibility that one party is being taken advantage of.
What are the three requirements of consideration?
Each party must make a promise, perform an act, or forbear (refrain from doing something). 2.) Each party’s promise, act, or forbearance must be in exchange for a return promise, act, or forbearance. 3.)
What are examples of consideration?
The definition of consideration is careful thought or attention or compassionate regard for someone or something. An example of consideration is someone deciding between two options for dinner. An example of consideration is someone bringing a friend dinner who just had a baby.
What are some examples of contracts that lack consideration?
An agreement also lacks consideration if the consideration of one party is provided in return for an action which the other committed prior to entering into the contract. If Kathy pulls Karen out of a burning car, Karen cannot be forced into an agreement where she provides consideration for Kathy’s rescuing her.
What is consideration and its rules?
“When at the desire of the promisor, the promisee or any other person has done or abstained from doing, or does or abstains from doing, or promises to do or abstain from doing something, such act or abstinence is called a consideration for the promisee.” This is a complex sentence.
What is a valid consideration?
Consideration is some thing of value promised by one party to another while entering into a contract. For a consideration to be valid there must be a promise from both sides. … This means that there must be a promise by one party against the promise of the other party.
What’s another word for consideration?
SYNONYMS FOR consideration
1 reflection, contemplation, rumination, attention. 3 kindness, kindliness, concern. 5 remuneration, fee.
What are included in consideration?
Consideration in a contract is the exchange of anything of value by each party.
- Personal property.
- Real property.
- Promise to act.
- Promise to refrain from acting.
What are the features of consideration?
The court in the case of Currie v Misa defined consideration as a right, interest, profit, detriment, loss, or responsibility. Its main characteristic is that the promissor must give a promise of something that is of value, and the promisee must give something of value in exchange.
What are the legal rules for valid consideration?
Rules Governing Consideration in Contracts
- Consideration must Move at the Desire of the Promisor.
- Consideration may Move front the Promisee or any other Person.
- Consideration may be Past, Present or Future.
- Consideration need not be Adequate.
- Consideration must not be Illusory but should be Real.
What are the exceptions to past consideration?
The Traditional Rule of Past Consideration
Certain exceptions to this rule are: A promise was made for a debt that is prohibited by a statute of limitations. If you owe someone a debt and the statute of limitations is expired, your debt can be enforced if you promised them you would pay it anyway.