Transcript CONSIDERATION - Villanova University

CONSIDERATION
Chapter 3
ELEMENTS OF CONSIDERATION
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Consideration: Legal detriment/Legal
benefit bargained for and given in exchange
for a promise of action.
Consideration has two elements:
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1.There must be a bargained for exchange.
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2.What is bargained for must have legal value.
Legal Sufficiency of Consideration
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Something of legal value must be given in
exchange for a promise.
It may be a return promise or performance.
If it is performance, that performance may be
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(1) an act (other than a promise); or
(2) a forbearance (refraining from action)
Legal Detriment / Legal Benefit
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Legal detriment is not always economic detriment.
A person can incur legal detriment by
(1) doing or promising to do something that he or
she had no prior legal duty to do
or
(2) refraining from or promising to refrain from doing
something that he or she had a prior legal right to do.
(that is, by forbearance).
Adequacy of Consideration
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Normally, a court will not question the
Adequacy of consideration unless it
indicates: fraud,
duress,
incapacity,
undue influence, or
a lack of bargained-for exchange.
Contracts that Lack Consideration
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Preexisting Duty
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A promise to do what one already has a legal
duty to do.
No legal detriment
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Past Consideration
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Promises made with respect to events that have
already taken place.
Not bargained for and given in exchange
Illusory Agreements
If the terms of a contract
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Express such uncertainty of performance that the
promisor has not definitely promised to do anything,
or
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Reserve, the right to cancel or withdraw at any time
without cause
the promise is illusory ,without consideration and
unenforceable.