问答题
(a) define and explain consideration. (3 marks)
【正确答案】Consideration
English law does not enforce every promise which is made. One way in which the courts limit the type of promise that they have to deal with is through the operation of the doctrine of consideration. English law does not enforce gratuitous promises, i.e. promises given for no return, unless of course such promises are given by way of a formal deed. For a simple promise to be enforceable in a court of law, it is necessary that the person to whom the promise was made, the promisee, should have done something in return for the promise from the promisor. That something done in return for a promise is consideration and can therefore be understood as the price paid for a promise. The element of bargain implicit in the idea of consideration may be seen in Sir Frederick Pollock’s definition of it, subsequently adopted by the House of Lords in Dunlop v Selfridge (1915), as:
‘An act or forbearance of one party, or the promise thereof, is the price for which the promise of the other is bought, and the promise thus given for value is enforceable.’
An alternative, and shorter, definition of consideration is ‘some benefit to the promisor or detriment to the promisee.’ It is important to note that it is not necessary for both elements in the definition to be present to support a legally enforceable agreement. Although in practice there usually is a reciprocal exchange of benefit and detriment, it is nonetheless possible for a promisee to provide consideration for a promise without their action directly benefiting the promisor. As long as the promisee acts to their detriment, it is immaterial whether that act actually benefits the promisor or not. The promisee will still have provided consideration and the promise made to elicit the promisee’s action will be legally enforceable against the promisor.
【答案解析】
问答题
(b) explain and distinguish between the following terms:
(i) executory consideration; (2 marks)
(ii) executed consideration; (2 marks)
(iii) past consideration. (3 marks)
【正确答案】Consideration can be divided into the following categories:
(i) Executory consideration is the promise to perform an action at some future time. One party to a contractual agreement may pay money to another on the understanding that the latter will perform some act for them in the future. Or alternatively, they might provide an immediate benefit for the other party on the understanding that the latter will provide a reciprocal benefit in the future. Contracts may also be made solely on the basis of an exchange of promises as to future action, without the need for any present action. In such circumstances, the mere promises provide mutual/reciprocal consideration and any such agreement entered into is legally binding and enforceable in a court of law. Such a contract is known as an executory contract.
(ii) Executed consideration, as may be gathered from the term, refers to consideration which has actually been carried out, thus making the promise for which it was performed enforceable. In the case of unilateral contracts, where the offeror promises something in return for the offeree’s doing something, the original promise only becomes enforceable when the offeree has actually performed the required act. The action requested does not have to be performed but once it is done the original promise then becomes legally enforceable. For example, if A offers a reward for the return of their lost dog, the reward only becomes enforceable once it has been found and returned to them.
(iii) Past consideration does not actually count as valid consideration. Consequently, no agreement resting on past consideration is legally enforceable. Normally, consideration is provided either at the time of the creation of a contract or at a later date. In the case of past consideration, however, the action done is performed before the promise. Such prior action is not deemed sufficient to support the later promise. Thus in Re McArdle (1951), a number of children were entitled to a house on the death of their mother. Whilst the mother was alive, a son and his wife had lived with her, and the wife made various improvements to the house. The children later promised that they would pay the wife £488 for the work she had done. It was held that as the work was completed before the promise was given, it was past consideration and the later promise could not be enforced.
There are exceptions to the rule that past consideration will not support a valid contract. For example, where the promisee performed the action at the request of the promisor and payment was expected, then any subsequent promise to pay will be enforceable. Thus in Re Casey’s Patents (1892), the joint owners of patent rights asked Casey to find licensees to work the patents. After Casey had done as requested, they promised to reward him. When one of the patent holders died, his executors denied the enforceability of the promise made to Casey on the basis of past consideration. It was held that the promise made to Casey was enforceable on the basis that there had been an implied promise to reward him before he had performed his action. The later promise merely fixed the extent of that reward.