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Explain Consideration Consideration as an essential element in a contract?

by BMS Team on OCTOBER 23, 2011 in BUSINESS LAW

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Q. Consideration: Essential element in a contract. Sec. 2 (d) Refines consideration as when at the desire of the promise the promisee or any other person (i) Has done or abstained from doing something. (ii) Does or abstains from doing something. (iii) Promises to do or abstains from doing something. Then such an act abstinence or promise is called a consideration than promise. Definition analyzed: I. At the desire of the promisor: The act or forbearance must be done at the desire of the promisor. A voluntary act is not a consideration. II The promisee or any other person.

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Consideration can be furnished by the promisee or any other person it may m ove from the promisee or a third party. . In English law, consideration must move from the promisee himself and not from any other person. III. has done or abstained from doing. Past consideration. Something wholly does not suffered, before making the agreement. In Indian Law past consideration is sufficient to sustain a valid contract. In English law it has to be either present or future. IV. Does or abstains from doing. Consideration may consist either or some act which the promisee does, or of some omission or for bearance on the part of the promisee or any other person. Definition by pollock: Pollock defines consideration as the price for which the promise of the other is bought and the promise thus given for value is enforceable. Consideration is a important requisite or contract. There as 2 clearly separable part the promise on one hand and the consideration for the promise on the other hand. Sec.2 (e) -Every promise and every set of promises forming the consideration for each other is an agreement. Sec. 2 (f) Promises which from consideration or part of the consideration for each other is called reciprocal promises. Consideration is a necessity to the validity of a contract. Law insist on the existence of consideration. Ex nudo pacto non oritur actio : Law will not enforce a promise given for nothing out of nacked pact. No cause of action arises. Consideration need not to adequate. Anson: Court does not sit to make bargains for the parties, although the act must be done for some consideration for some value. Q. Points of difference between English and Indian law as regards consideration: 1. English law, a contract under seal (registered) is binding without consideration Indian Law has not such distinction. Consideration is a must. 2. English law, consideration must move from promisee only. Indian law, it may move
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from promisee or any other person. 3. English law, consideration need not be adequate but must have some value Indian law as per Sec. 25 natural love and affection is a good consideration. 4. English law, consideration may be present or future. Indian law past consideration future. Indian law past consideration supports the subsequent promise.
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