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Consideration - Coggle Diagram

- - - - A builder executed work for his neighbouring parish in return for prayers being said for him and his family
        
        This was not held to be sufficient consideration
        
        Andrews LJ gives no reason for his decision other than the bald assertion that he could find no authority to support such a proposition
        
        There seems to be no good reason as to why the prayers did not constitute sufficient consideration, as the builder clearly placed a high value on them
    - - The plaintiff was a deeply religious minor, who sought a share of the defendants lottery win of $2.8 million
      - He claimed that he had purchased the winning ticket with the defendant's money pursuant to her promise that she would share the prize money equally with him if he prayed to 'Saint Eleggua' to cause the lottery numbers selected for her to win
      - The Supreme Court of New York held that the plaintiff could not prove compliance with the contract as he could not prove that his prayers were efficacious and that the saint caused the numbers to win.
        
        "Faith is an antithesis to proof"
        
        Theology is to be protected against the law, just as the law is to be protected from theology
  - - - The House of Lords rejected a claim that when a casino provides a gambler with gaming chips the issuing of those chips constitutes a valuable consideration
  - - - Revenue Commissioners v Moroney
        
        A father purported to sell a pub to his two sons for £16,000
        
        The Court realised that this consideration was not paid and was never intended to be paid
        
        It was a sham transaction entered in order to avoid estate duty
        
        There was therefore no consideration and the transaction was treated as a gift
  - - - Johnson J held that there was no agreement for valuable consideration where a father made over a property to a son ‘for natural love and affection’ and then promised an allowance to the son to assist in maintaining the property.
- - - - Tweddle v Atkinson
        
        Two fathers promised to pay money to their respective children who were married to each other
        
        The plaintiff husband tried to enforce this promise against the estate of his late father-in-law following the latter's death.
        
        He was not allowed to as the promisee had provided no consideration for his father-in-law's promise
  - - - The consideration is said to be past consideration, which is no consideration at all
    - - Roscorla v Thomas
        
        Plaintiff bought a horse from the defendant for £30. Following the sale, the defendant warranted that the horse was sound and free from any vice
        
        When this statement proved to be untrue, the plaintiff sued for breach of warranty
        
        The Court said that the warranty was unenforceable, as it was not supported by the consideration.
        
        The warranty was subsequent to the act (the purchase of the horse) and was independent of it. Thus, there was no consideration given in exchange for the warranty
      - Law Society of Ireland v O'Malley
        
        The respondent was supported by gifts from his wife's family. He was subsequently involved in a road accident and an action was commenced by him to recover damages for his injuries
        
        It was expected that a settlement would be reached in those proceedings and he instructed his solicitors to give an undertaking that any monies recovered in that action would be paid to his wife's family
        
        The question arose as to whether any consideration had been given in exchange for this undertaking
        
        Lynch J identified the problem as one of past consideration
        
        "The problem for the respondent and the O’Conghaile family is the requirement of valuable consideration. Undoubtedly support and maintenance was afforded to the respondent and his family by the O’Conghaile family, but that was all past consideration and not therefore valuable consideration in law."
      - Re McArdle
        
        A woman carried out work to a house jointly owned by members of her family. After the work had been completed her relatives signed a document promising to pay her for the work.
        
        It was held that she could not recover the sum promised as her consideration (working on the house) has been completed before the promise was made
      - Exception to the rule
        
        Pao On v Lau Yiu
        
        The defendant asked the plaintiff not to sell some shares for a period of one year
        
        The plaintiff was agreeable to this and promised to hold onto the shares for one year.
        
        Subsequently, thee defendant gave the plaintiff a guarantee to indemnify(compensate) it if the price of the shares fell during the said year
        
        When the share price fell, the defendant refused to indemnify the plaintiff and the question arose as to whether any consideration had been given in exchange for the indemnity
        
        Lord Scarman held that an act done before the giving of a payment or to confer some other benefit can sometimes be consideration for the promise if the following test is fulfilled
        
        The act must have been done at the promisor's request
        
        The parties must have understood that the act was to be remunerated either by a payment or the conferment of some other benefit
        
        Payment, or the conferment of a benefit, must have been legally enforceable had it been promised in advance
  - - - The defendant requested, and received, a worthless piece of paper in return for the promise to pay £10,000
      - The piece of paper was held to constitute good consideration
- - - - Plaintiff was subpoenaed to give evidence at the trial of the defendant. The plaintiff promised the defendant a 6- guinea attendance fee
      - The plaintiff was not allowed to enforce this promise as he had not provided consideration because he was under legal duty to attend court
    - - Glasbrook v Glamorgan
        
        The owner of a local coal mine sought police protection for the mine and its equipment during a strike
        
        The police felt that a mobile unit would be sufficient but the mine owner sought a standing guard
        
        The police authority provided this and imposed a charge
        
        The House of Lords held that the provision of the constables was done for valuable consideration
        
        The police had a discretion as to how much protection was necessary and an undertaking to provide more than they deemed necessary could amount to sufficient consideration.
        
        The police officers had been placed at the mine to meet the wishes of the mine owner, and valuable consideration had been provided.
      - Harris v Sheffield United
        
        The defendant promised money to the police to guard their ground at home matches
        
        The defendant said that the police were under a legal duty to preserve law and order
        
        The Court allowed the promise to be enforced as the matches were put on at private premises staging a privately organised football match
        
        On that basis overtime payments and other expenses were recoverable for the police from the football club
        
        Given the strain on scarce police resources the services provided were special police services
- - - - The debtor has only performed part of the contractual duty that he owes the creditor
  - - - The plaintiff did some building works for the defendant and was owed £482 pounds by him
      - The plaintiffs were in a dire financial situatuion and pressed for payment for 6 months without success
      - Finally, the defendant's wife, knowing of their money problems, offered them £300 in full settlement stating that if they did not accept that they would get nothing.
      - The plaintiffs reluctantly agreed but once they got the £300 pounds they sued for the rest
        
        The Court of Appeal allowed their claim on the basis of the rule in Pinnel's case
  - - - Suppose you are owed £100 and you agree to take a book instead. Even if the retail price of the book is only worth £60 you cannot sue for the additional £40
      - Corporation of Drogheda v Fairtlough
    - - If A owes B and B agrees to accept £50 from C on the basis that he will discharge A from the debt then this agreement will be upheld should B subsequently attempt to sue for the remainder of the sum
      - Welby v Drake
        
        The defendant owed the plaintiff £18 and the defendant's father agreed to pay £9 in full satisfaction of the debt.
        
        This prevented the plaintiff from sueing for the remainder, as by suing the defendant in this way he would commit fraud on the father
    - - This arises where an agreement is entered into with a number of creditors each agreeing to accept a fixed portion of debt in full satisfaction
      - A number of creditors can agree to accept reduced payment on their debt in full satisfaction despite the absence of obstensible consideration
        
        In simple terms, composition with a single creditor is not enforceable without consideration but composition with more than one creditor is
        
        The reason is that if a creditor subsequently tried to recover the remainder, it would be viewed as a type of fraud on the other creditors
- - - - It provides certainty and ensures that potential liability is limited to the parties named in the deed since onlt parties to a sealed instrument may have obligations and rights under it
      - It shows that the promise was seriously meant
- - - - The nephew agreed to the terms and followed them until graduation
    - - He claimed that there was no detriment to the nephew and no benefit to the uncle