courts have » consistently with this approach ~ been satisfied with consideration which fpaily had No eeonomic valve om ‘A \aige part of the difficulty of the case taw on consideration steis from the fact that the courts have sometimes apparently put the doctrine Into reverse and denied the existence of @ legally acceptable consideration although there was clear commercial value given in return for the promise. The concept of consideration used by the courts in these cases is cloatly opposed to and inconsistent with that upon which the validity of nominal consideration Is based, The courts do not openly recognise the inconsistency between these two uses of the feetine of consideration but speak as if there was a single coherent principle, Dofinition: Consideration is some benefit received by a party who gives a promise or performs an act, or some detriment suffered by a party who receives a promise. It may also be defined as “that which is actually given or accepted in return for a promise". In Currin v. Misa (1875) LR. 10Ex, 153 it was defined by the court as “some right, interest, profit or benefit accruing to one party, or some forbearance, detriment, loss, or esponsibility given, suffered or undertaken by the other’, It should be added to this definition that the benefit accruing or the detriment sustained was in return for a promise given or received Executed and Executory Consideration: When the act constituting the consideration is completely performed, the consideration is said to be executed. When the consideration takes the form of a promise to be performed in the future, itis executory An executed consideration is therefore an act done by one party in exchange for a promise made or an act done by the other; an executory consideration is a promise made by one party in exchange for a promise made or act done by the other.Lecture 6 Past Consideration: This is not generally treated as good consideration. In Roscorla v. Thomas (1842) 3 Q.B. 254 the Plaintiff bought a horse from the Defendant. After the ale the Defendant orally assured the Plaintiff that the horse was in sound condition, Shortly afterwards the horse died. The Plaintiff brought an action for damages. It was hold that the promise as to sound health was not enforceable as it was only supported by past consideration. The exception is where the past act was done or the part services rendered at the request of the promisor. In ‘Lamoleigh v, Braithwaite (1615) 80 E.R. 265 the Defendant had killed a man and had requested the Plaintiff to petition the king to pardon him. The Plaintiff managed to convince the king that the Defendant should be granted a royal pardon. Alter the pardon had been obtained the Defendant promised to the Plaintiff one hundred pounds for his efforts. The Defendant failed to pay and the Plaintiff brought an action to enforce payment. The question was what consideration the Plaintiff had supplied for the promise to pay him the one hundred pounds. Held: There was a contract even though obtaining the pardon was pail consideration The services had been rendered at the Defendant's request and were on the understanding that they would be paid for. Note that moral obligation is not good consideration in law. In Eastwood v. Kenyon (1840) 113 E.R. 482 the guardian of a young girl had raised a loan to pay for her maintenance and education and generally to improve her wellbeing. She subsequently came of age and married. Her husband promised the guardian to pay the amount of the loan. In dismissing the guardian's action on this promise, the court rejected the argument that the husband's promise was binding merely because he was under a moral obligation to perform it, Denman C.J. said that this argument would “annihilate thehocossity for any consideration at all, inasmuch as the mere fact of giving a promise Antecedent Deby Payment of an already existing debt does not normally amount to good consideration. It «moral obligation to perform it je regarded a8 past consideration and a promise to pay it by the promisor to the promisee ip not contractually binding, In practice however the creditor (ie. the promise) «will often provide consideration for such a promise by forbearing on the strength of the promi not to sue for the debt. * ¢ Consideration must move from the Promisee: This means that the person to whom the promise is made must furnish the consideration. In Dunlop Pneumatic Tyre Co. Ltd v. Selfridge & Co. Ltd (1915) A.C. 847, Dunlop who were wholesale tyre manufacturers sold tyres to X under a contract, whereby X undertook not to sell the tyres below Dunlop's list prices and agreed as Dunlop's agent to obtain a similar undertaking from other traders. X sold to Selfridge who agreed with X not to sell below Dunlop's list prices. Selfridge broke this contract and Dunlop sued for its breach. vou “Assuming that X was the agent of Dunlop when he obtained the price maintenance stipulation from Selfridge, Dunlop could not enforce the contract because no consideration moved from them. The rule is based on the principle that a stranger to the contract cannot sue on it- a rule known as the doctrine of privity of contract. In Beswick v. Beswick (1968) A.C. 56 Peter, @ coal merchant, entered into a written contract with his nephew John, where Peter sold his business to John. The contract provided that after the death of Peter the nephew would pay te widow (who was not a party to the agreement) an annuity of five pounds a week. Peter died and the nephew refused to pay her.Hold. The widow could not enforce the obligation in her personal capacity as she was not @ paity to the contract; as administratrix of Peter's estate, however, she could ‘enforce his contracts as his representative and thereby obtain an order for specific performance requiting the nephew to make the annuity payments. ‘Suffigioney and Adequacy of Consideration Nowbold J. in Hassan Ali v._Jeraj (1957) E A_at 555 commented on the proposition that the courts are not concerned about the adequacy but only determine whether it is sufficient. The consideration must be sufficient even though it need not be adequate. Consideration need not be as valuable as the promise. Sufficiency means that the consideration has some value in the eyes of the law. This is in keeping with the notion that under common law contracts are the creation of the parties involved. Posner Economic Analysis of Law at especially p. 46 where the author seems to ‘suggest that once there is consideration there is an exchange, a bargain, and the courts are not well equipped to inquire into the adequaly of the consideration. Even though sufficient, consideration not given in reliance of the promise may fail In Kiboro v EAP.T. H.C.C. App. No. 50 of 1973 the Plaintiff had worked for many years with the Defendant corporation and wished to resign to take up a better paid job. Under the terms with the Corporation he was entitled to be paid a gratuity if he was retired in the public interest. A sub-committee agreed to retire the Plaintiff and promised to pay him one thousand two hundred and seventy eight pounds as gratuity. After he had received notice of this decision he took up the new job. Unfortunately the Board of Directors nullfied the sub-committee's decision. The Plaintiff's action in breach of contract was dismissed on the grounds that he had not given any consideration for the sub-committee’s promise. His resignation was said not to be good consideration as it 24Was not a detriment to him as he was going to take up a better paid job. Even i it had been it had not occurred result of the sub-committees offer Even though trivial acts may be sufficlent consideration, illusory consideration is not sufficient consideration. e.g. where a person promises to do what both parties know is humanly impossible e.g. where one promises to pay another K.Shs. 10,000 ‘= if this other swine trom Mombasa to London. Another istration of the rule is the fact that forebearance to sue is sufficient consideration. Eg. if X had a legal claim against Y and as consideration to X's promise not to sue Y, ¥ promises wpiy something, Y's promise is enforceable. Parties should be encouraged to compromise outside the court as a public policy. That consideration need not be adequate proved by the fact that in some cases what appears to be trivial acts may be regarded as such. e.g. in Chappell & Co. Ltd v. Nestle Co Lid 1960 A.C_67 the Defendants put up an advert to the effect that a record with tho song “Rocking Shoes” could be bought for 1s. & 6d. provided that the purchaser brought with him 3 wrappers from the Defendants, 6d. milk chocolate bars. Under the Copyright Act a person could make a record for the purpose of selling it by retail provided he gave notice to the copyright owners and paid a royalty of 6 1/4% for the iain problem was whether the records were sold by retail for purposes of the fight, Th Act Held. The Plaintiff who owned the copyright was entitled to an injunction restraining the Defendants from breach of their copyright. The advert was not an ordinary sale by retail. Sale by retail meant that goods would be given over for money consideration. The ren of the consideration inspite of the fact that the Defendant company wrappers w just threw the wrappers away. 4