TYPES OF CONSIDERATIONS
There are mainly three types of consideration, and those are:
1. Present consideration
2. Future consideration
3. Past consideration
Present consideration
Present consideration is which promise is done by present. Suppose-we want to go to Dhanmondi, that’s why we go to bus stand, to the bus counter we told the counterman, give me a ticket to dhanmondi, he told me give money and we give him the money and he give the ticket to dhanmondi. It is a present consideration.
Future consideration
Are what we promise to exchange, we exchange it in future. Suppose- A and B made a promise that, A will buy B’s car at cost $1000 after 15 days. And it is a future consideration.
Past consideration
It means “What we have done before but we get payment right now”. And we don’t expect it. Suppose- My relative gives me a work to do before. And we have been done it that time. Right now my relative gives me some money now which we are not expecting.
In three cases past consideration for a promise does suffice to make the promise binding.
- Bill of exchange
- Recovery of a dept
- Service made on request.
Finally, need to identify any legal claims and defenses that the parties may have. Select the relevant law
The principal authorities in English law (and other common law jurisdictions) are statutes, delegated legislation, and case law, although in many subjects it will also be necessary to ask whether there are any relevant provisions of European Community law or of the European Convention on Human Rights as made relevant to the English legal system by the Human Rights Act 1998. It is important to bear in mind the weight of various authorities (in terms of court level) when selecting the law to support your arguments. Remember that no court can quash primary legislation and persuasive authorities (for example, cases decided by the Privy Council or the High Court of Australia) might influence a court to follow a particular line of reasoning, but do not bind it to do so.
At the planning stage, step two requires to select the law, which is relevant to the issues identified at stage one. At the writing stage, this is made explicit when states the law have selected to support the legal claims and defenses you have identified. Selecting the relevant law is a filtering process where you sift out any irrelevant law and retain only the law, which is pertinent to your answer.
Apply the law
Applying the law at the planning stage means considering how the law you have selected fits the material facts. Later, at the writing stage, you will apply the law to support your discussion, and thus demonstrate that you can construct a logical argument.
The third step in the problem-solving process requires you to apply the relevant law to the material facts. It is your ability to do this convincingly that demonstrates the true extent of your understanding. One type of classically bad answer simply reproduces, more or less accurately depending on the extent of your knowledge and understanding, all the law on the topic, with no attempt at selection or application. In terms of professional practice, the equivalent would be simply to read aloud to the client the whole of the relevant chapter from a textbook, and then claim that this amounts to giving the client legal advice.
Conclude with advice
In most problem questions you will be asked either to advise one or more of the parties, or to discuss the legal issues, which arise from the facts. If you are required to give advice, you may feel that once you have identified the issues, selected and applied the relevant law and produced a logical answer following the steps outlined above, it will be obvious to the examiner what your advice will be. Nevertheless, you should conclude your answer with a short paragraph containing your advice. Similarly, if the question requires you to discuss the legal issues arising from the facts, you should conclude with a short summary of the issues you have been discussing.
Irrelevant facts
It needn’t be adequate. If consent was freely given to the agreement, “an agreement to which the consent of the party is freely given is not void merely because the consideration is inadequate, but inadequacy of the consideration may be taken into by the court in determining the questions whether the consent of the promise was freely given”.
Distinguish between relevant and irrelevant facts
Irrelevant facts mean it does no have anything to do with proving any of those elements. Often an attorney will try to get irrelevant evidence introduced for other factors, such as showing prior crimes, or getting the sympathy of the jury, which may or may not be applicable to what is being tried.
Relevant facts means that the evidence provided goes toward establishing whether a person met one or more of the required elements of a crime.
- Differential/ marginal/variable/incremental costs are always relevant
- Cash costs and future costs are always relevant
- Past costs or sunk costs are always irrelevant
- Fixed costs are always irrelevant unless they are incremental
Privity of contract and consideration
Promisee or any other person
The second notable feature of the definition in section 2(d) is that the fact which is to constitute a consideration may be done by “the promise or any other person”. It means, therefore, that as long as there is a consideration for a promise, it is immaterial who has furnished it.
It may move from the promise, or, if the promisor has no objection, from any other person. This principle had its genesis in the English common law, having been adopted by the court of king’s Bench as early as 1677 in Dutton v poole.
Position of Beneficiary who is not party
Nearly two hundred years later in 1861 in Tweddle v Atkinson the Court of Queen’s Bench refused to follow this principle.
The plaintiff was to be married to the daughter of one G and in consideration of this intended marriage G and plaintiff’s father entered into a written agreement by which it was agreed that each would pay the plaintiff a sum of money.
Privity of consideration
The former of these two propositions is not at all applicable in India. Here in view of the clear language used in defining consideration in section 2(d), it is not necessary that consideration should be furnished by the promise.
A promise is enforceable if there is some consideration for it and it is quite immaterial whether it moves from the promise or any other person.
Privity of contract
The rule of “privities of contract” which means that a stranger to contract cannot sue has taken firm roots in the English common law. But the principle has been generally criticized. In 1937, the Law Revision Committee, under the chairmanship of lord Wright, also criticized the doctrine and recommended its abolition.
Exceptions to privity Rule
Some of the commonly known exceptions may be considered here.
1. Beneficiaries under Trust or Charge or Other Arrangements.
2. Marriage settlement, Partition or other Family Arrangements.
3. Acknowledgment or estoppels.
4. Covenants running with land.
DEMONSTRATE INDEPENDENT LEGAL RESEARCH
Contract out of love and affection, “If agreement made without consideration is void unless it is expressed in writing and registered under the law for the time being enforce for the registration of documents, and is made on account of natural love and affection between parties standing in a near relation to each other.” Ex: This time Shaikh Abdur Rahim allowance if any person find my mobile so, I gave 100 Taka only. Then Moumita Saha fined the mobile and gives it and takes money. This is valid contract.
Executed gift is, “nothing in this section shall affect the validity, as between the donor and done, of any gift actually made”.
Contract for appointing agent it must be, “No consideration is necessary to create an agency.” Ex: Shaikh Abdur Rahim gives a take care authority to Mohammed al- Zubair. This time Mohammed al- Zubair is not an owner, he is care taker.
Contract for repayment of time barred debt, “If agreement made without consideration is void, unless it is a promise in writing and signed by the person to be charged therewith or by his agent generally or specially authorized in that he half, to pay wholly or in part a debt of which the creditor might have enforce payment but for the law of limitation for suits.” Ex: Rohim said his wife; he gives 500 take every day and this agreement is taken by the written and notification. But next rohim don’t pay money so, this time agreement is not right and this agreement consider in “loaffection” point of view.
An agreement made without consideration is void. It means that consideration is a must in all cases.
Rules of consideration in contract
- Consideration must move at the desire of the promisor: In order to constitute legal consideration, the act or abstinence forming the consideration for the promise must be done at the desire or request of the promisor. Suppose A sees B’s house on fire and helps in extinguishing it. He cannot demand payment for his service because B never asked him to come for help.
- Consideration must be real: In the eye of law the consideration must be real. It must not be sham or illusory. Suppose Y promises to supply X one tola gold of gold from the moon. The consideration is sham and illusory and there is no contract
- Consideration must be Reasonable: The consideration must be reasonable. Without a good reason it will not be a contract.
- The consideration must not be illegal, immoral or opposed to public policy: If the consideration of the objective of the agreement is illegal, the agreement cannot be enforced. Suppose A and B make an agreement that B will kill C for 1lakh taka. It will not be a consideration.
- Present, past and future: In the consideration present past and future consideration must have to be available, without this three it will not a consideration.
- From the promises or any person: Consideration need not move from the promises alone but may proceed from a third person.
No Consideration NO Contract
A promise without consideration is a wanton undertaking and cannot create a legal obligation.
Consideration for a particular promise exists where some right, interest, profit or benefit accruesto the promisor as a direct result of some forbearance, detriment, loss or responsibility that has been given, suffered or undertaken by the promisee. Contract is an exchange of promises between two or more parties to do or refrain from ding an act which is enforceable in a court of law.
Contract out of love and affection, “If agreement made without consideration is void unless it is expressed in writing and registered under the law for the time being enforce for the registration of documents, and is made on account of natural love and affection between parties standing in a near relation to each other.”
Contract for repayment of time barred debt, “If agreement made without consideration is void, unless it is a promise in writing and signed by the person to be charged therewith or by his agent generally or specially authorized in that he half, to pay wholly or in part a debt of which the creditor might have enforce payment but for the law of limitation for suits.”
Contract of remission or waiver of rights,
“Every promise may dispense with or remit, wholly or in part the performance of the promise made to him or may extend the time for such performance, or may accept instead of it any satisfaction which he thinks fit.”
Contract for appointing agent “No consideration is necessary to create an agency,” An agreement made without consideration is void. It means that consideration is a must in all cases.
EXPRESS & PRESENT
This reason is insufficient to judge a commercial contract or promise enforceable as it lacks valid, valuable and legal basis for the reason. Also refer to valuable consideration. A good consideration doing something based on natural affection, generosity, love or moral duty. A good consideration must be maintains all rule. The necessary factors for consideration can be summed up as follows;
- There must be desire of the promisor.
- It should be real.
- Law must be reasonable.
- It mustn’t break rule.
- It mustn’t be immoral, non-legal, opposed to public policy.
- Its must maintain present, past and future.
- It’s stated to promise or any person.
There are conditions of good consideration. Every law must be following all this.
CONCLUSION
When a promisor makes a clear and definite promise on which the promise justifiable relies, the promisor is bound by the promise, even if it was insufficient to form the basis of a valid, legally binding contract.
Promissory maintain requires the following elements are, The promise was clear and definite, justifiable relied on the promise, substantial and of a definite character and will serve the best interests of justice. Consideration of some sort or other is so necessary to the forming of a contract, that an agreement to do or pay something on one side, without any compensation on the other, will not at law support an action and other activities.
Promises enforceable, despite the lack of consideration are, to pay a debt otherwise discharged by limitations, in rare cases and to charitable institutions. This situation is effect one contract and consideration.
BIBLIOGRAPHY
WEB-SITE:
Web address: www.en.wikipedia.org/wiki/contract, collected on February 25, 2012 at 8.00 am to 9.00 am.
Web address: www.law.freeadvice.com/general_practice/contract_law, collected on February 25, 2012 at 8.00 am to 9.00 am.
Web address: www. Lawsociety.com/general/contract & consideration, collected on February 25, 2012 at 8.00 am to 8.30 am.
Web address: www.lawteacher.net/contract-law, Retrieved on February 26, 2012 at 11.30 pm to 12.30 am.
Web address: www.e-lawresources.co.uk/consideration.php, collected on February 29, 2012 at 8.30 pm to 9.00 pm.
Web address: www.nolo.com.legal…/consideration-every-contract -needs-33361.ht, collected on February 29, 2012 at 8.30 pm to 9.00 pm.
REPORT & BOOK
“Business Law”, Writer is “Mohammad Khalakurjaman”, Published by NationalUniversity.
“Principles of Mercantile Law”, Writer is “Dr. Avtar Singh”. Easteran Book Company.