Define
consideration and describe rules regarding consideration?
Consideration can be defined as a price of promise, which is bought by the next parties (promise). When a party to an agreement promises to do something he/she must get something in return which must be valuable in the eye of law. This ‘something’ is defined as a consideration that may be price, reward, payment, or value for which the promise of the other is carried.
According
to Justice palterson, "Consideration means something, which is of some value in
the eye of the law, it may be some benefit to the planting or some detriment to
the defendant."
For
example, A agrees to sell a house to B for Rs 2 lakh. For A’s
promise, the consideration is Rs. 2 lakh and for B’s promise, the consideration
is the house.
Rules Regarding consideration
a) Consideration must be real and something of valuable in the eye of law.
b) Consideration must move at the desire of the promisor:
The act must be done at the desire of the promisor. Without the
desire of the promisor, no consideration can be valuable. It regards that the
consideration must be moved from promise only not from other or stranger to
contract.
c) Consideration may move from the promise of third persons:
The act which constitutes a consideration may be moved by the
promise or any other person on his behalf to enforce a promise. But in English
law, it must be from the promise not from others.
d) Consideration may be of past, present, or future.
e) Consideration must be lawful:
When a party to an agreement promises to do something the
acceptors must get something in return which must be legal and have the values
in the eye of law. An illegal consideration is not supposed to be a contract.
It is void.
f) Consideration need not be adequate (satisfactory):
Consideration need not be adequate for the promise. The contract
is dependent upon consideration. So the quantum of the consideration is decided
by the parties to the contract. The adequacy of consideration is determined by
the facts, circumstances, and necessities and nature of cases.
Reviewed by Bijay Munikar
on
September 29, 2020
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