Please enable JavaScript.

Coggle requires JavaScript to display documents.

Consideration (Rules (Does the purported consideration fall within the…

- - - - Exception - Pao On v Lau Yiu Long (1979) - three stage test
        
        At the request of the promisor? - Lampleigh v Kenyon (1615)
        
        Payment understood to be due? - Re Casey's Patents (1892)
        
        Contract enforceable apart from this issue?
    - - Connected, but distinct from privity of contract - Dunlop v Selfridge (1915)
    - - "A peppercorn does not cease to be good consideration if... the promisee does not like pepper and will throw away the corn" - per Lord Somervell - Chappell & Co v Nestle & Co (1960)
        
        Giving up legal right?
        
        White v Bluett (1853) - must still have some value in the eyes of the law
        
        Hamer v Sidaway (1891) - gave up drinking - held to be a legal right
        
        Modern judges will try to find consideration wherever possible
    - - a) Under a contract
        
        Stilk v Myrick (1809) - went no further than original obligation
        
        Exceeding an existing contractual obligation - Hartley v Ponsonby (1857)
        
        'Factual consideration'/'Practical benefit' - Williams v Roffey Bros (1991) - per Glidewell LJ
        
        Promisee has a contract with promisor to supply goods or servives
        
        Promisor has reason to doubt that promisee will, or will be able to, complete
        
        Promisor promises to pay promisee extra to complete on time
        
        Promisor obtains 'practical benefit' or 'obviates a disbenefit'
        
        Promisor's promise not given as a result of fraud or duress
        
        Affirmed in Adam Opel GmbH v Mitras Automotive (UK) Ltd (2008)
      - b) Under law - Collins v Godefroy (1831)
        
        Exceeding an existing obligation imposed by law
        
        Harris v Sheffield Utd (1988)
        
        Ward v Byham (1956)
      - c) Owed to a third party
        
        Scotson v Pegg (1861)
        
        Third party consideration provides right to sue
        
        New Zealand Shipping v Satterthwaite (The Eurymedon) (1975)
    - - Confirmed in Re Selectmove (1995)
        
        Exceptions
        
        Common law - Pinnel's Case (1602) - "a hawk, a horse or a robe"
        
        A different thing
        
        A different place
        
        Earlier
        
        Common law - Welby v Drake (1825) - where a lesser amount is paid in satisfaction of a debt by a third party to that debt, the creditor cannot sue for the balance
        
        Common law - practical benefit - MWB Business Exchange Centres v Rock Advertising Ltd (2016)
        
        Equity - promissory estoppel
        
        "Estoppel is a principle of justice and of equity. It comes to this: when a man, by his words or conduct, has led another to believe in a particular state of affairs, he will not be allowed to go back on it when it would be unjust or inequitable for him to do so" - per Lord Denning, CLP Trust v High Trees House (1947)
        
        Origins
        
        Hughes v Metropolitan Railway (1877) - Lord Cairns
        
        CLP Trust v High Trees House (1947)- Denning J - "a promise intended to be binding, intended to be acted on and in fact acted on is binding so far as its terms properly apply"
        
        Judicial reaction - "This principle caused some eyebrows to be raised in high places. But they have been lowered since" - per Lord Denning, D & C Builders Ltd v Rees (1966)
- - - - Either by express statement by by conduct which implies that promise
      - Promise must be clear - Woodhouse v Nigerian Produce (1972)
    - - Ajayi v Briscoe (1964)
      - Brikom Investments v Carr (1979)
      - Collier v P & MJ Wright (2007)
      - Reliance need not be detrimental
        
        "It is not necessary to show detriment; indeed, the representee may have benefitted from the representation, and yet it may be inequitable... for the representor to enforce his legal rights" - per Goff LJ, The Post Chaser (1982)
        
        Alan & Co v El Nasr (1972)
    - - "It does not follow that in every case in which the representee has acted, or failed to act, in reliance on the representation, it will be inequitable for the representor to enforce his rights" - per Lord Goff, The Post Chaser (1982)
      - D& C Builders v Rees
    - - Acts as a defence to a claim
      - It is not a cause of action
      - Combe v Combe (1951) - 'the principle never stands alone as giving a cause of action in itself" - per Lord Denning
  - - - i) Cesation of circumstances giving rise to the estoppel - CLP Trust v High Trees (1947) OR
      - ii) 'Reasonable notice" - Tool Metal v Tungsten Electric (1955)
    - - With lump sum, usually only suspends payment - just have to give reasonable notice - but might be circumstances with periodic payments where debt should be extinguished completely
- - - - Where contract entered into unwillingly by one party due to threats to their person
      - Test for causation
      - Need not be 'the' reason (for entering into a contract) but 'a' reason - Barton v Armstrong (1976)
    - - The unlawful detention of another's goods
      - "If I should be compelled to sign a contract under an imminent threat of having my house burnt down, I do not think that the law would uphold the agreement" - per Kerr J, The Siboen and the Sibotre (1976)
      - Test for causation - 'but for'
    - - Emerging doctrine, first recognised in The Siboen and the Sibotre (1976)
      - The effect of duress
        
        There must be PRESSURE, resulting in...
        
        a) LACK OF PRACTICAL CHOICE for the victim
        
        "Whether the victim had any realistic practical alternative but to submit" - per Dyson J, DSND Subsea v Petroleum Geo (2000)
        
        Carillion Construction Ltd v Felix (UK) Ltd (2001)
        
        B&S Contrcts & Design Ldt v Victor Green Publications Ltd (1984)
        
        Kolmar Group AG v Traxpo Enterprises Ltd (2010)
        
        Atlas Express v Kafko Ltd (1989)
        
        b) Which is ILLEGITIMATE, and
        
        Factors to consider in legitimacy of pressure
        
        Threatened breach of contract?
        
        Atlas Express Ltd v Kafko Ltd (1989)
        
        Carillion
        
        B&S Contracts
        
        Was pressure applied in good or bad faith?
        
        Bad faith
        
        6 more items...
        
        Good faith
        
        2 more items...
        
        Did victim protest?
        
        Carillion
        
        DSND Subsea
        
        Did victim affirm or seek to set the contract aside?
        
        Lengthy delay - contract affirmed
        
        2 more items...
        
        No illegitimate pressure = no duress
        
        Alec Lobb v Total Oil (1983) - 'a hard bargain'
        
        R v Attorney General of England v Wales (2003) - 'overwhelming pressure' but not duress
        
        c) Which is a SIGNIFICANT CAUSE inducing the claimant to enter into the contract
        
        Was the pressure the 'significant cause' of the victim's decision to enter into the contract?
        
        Huyton SA v Peter Cremer - 'but for'
        
        Per Dyson J, DSND Subsea v Petroleum Geo Ld (2000)
        
        Affirmed - Carillion Construction Ltd v Felix Ltd (2001); Kolmar Group AG v Traxpo Enterprises Ltd (2010)