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Consideration - Section - 2d and Section 25 - Coggle Diagram
Consideration - Section - 2d and Section 25
When at the desire of the promisor -> does/done/promises to act/abstain something such act/abstained is called consideration : :
Promissory Estoppel
Case Law - Durga prasad vs Baldeo 1880
A plaintiff constructed market at the request of DM
B defendant -occupies the shops and promises to pay A a commission on articles sold in the
market established by him (A)
B Fails
Question
- Can B Compelled to pay commission to A?
Answer - No
Held - Promise was not supported by consideration/
Case Law
Kedarnath Bhattacharjee vs Gorie Mohommad 1886
Howrah Municipalities Commissioner -> Invitation -> collecting subscriptions from public
Purpose - to built Town Hall
A Plaintiff B Defendent --> On the basis of promise of B(to give 100rs as subscibtion) A contracts contractor for building for town.
B fails to pay
Issue - Can B be sued by A ?
Contention of B - their is no consideration .
Held - The Act of A entering into contract with contractor was
done at the desire of B
, so it constitutes consideration u/s 2d
Abdul Aziz vs Mosum Ali 1914
Defendent promises to pay rs 500 to rebuilt mosque --> B Failed to pay
defendent not held liable as their is no further consideration created based on such promise unlike kedarnath.
Promises of charitable nature
Where
promisor
has agreed to contribute to charitable/religious cause Promise is enforceable as soon as further liability has been incurred due to that promise
Dorawamy Iyer vs Aurnachala Ayyor 1936
repair of temples going on more money was required
A defendent PTP rs 125 - later backed out
Issue Recovery Allowed?
Held - No, because no fresh liability incurred by the promise thus fails to create consideration.
Types of Consideration
Past Considerations
Executory consideration
Executed consideration
Section - 25 Agreement without consideration, void, unless it is in writing and registered, or is a promise to compensate for something done or is a promise to pay a debt barred by limitation law.
—
SC(1)- It is in writing and Registered - made on an account of Love and affection
SC(2) or is a promise to compensate for something done already
voluntarily
SC(3)Or is a promise to pay debt barred by limitation law - in writing and signed.
Essentials
The consideration may move from the promisee to any other person or a third party
The consideration must not be unlawful
The consideration must not be physically impossible
The consideration may not be adequate
The consideration must move at the desire of the promisor
(Durgaprasad vs Baldeo)
Privity of Contract and Consideration
Privity of Consideration
It was held in
Chinmaya vs Ramayya
- that A promise is enforceable if there is some consideration for it and it is quite immaterial whether it moves form the promisee or any other person
Facts/Held
So there is a subsequent contract was created by Daughter and her uncle therefore the consideration though coming from some other person actually exists Thus courts held the privity of consideration doesn't exists.
Privity of Contract
In case of
Dunlop Pneumatic Tyre and Co Ltd Vs Selfridge and Co. Ltd
Reserved Price Case
A contract B to sell at reserved price B sold it to C , C sold it below reserved price
A sued C
C not held liable as privity of contract recognizsed
So as to say - for suing third party that party must be party to contract
Exception
Beneficiaries under trust of charge or other arrangements
Marriage under trust or charge or other arrangements
Acknowledgement or Estoppel
Covenants running with land
Pre-Existing Obligaton
Collins vs Godefn
-witness summon case
Ramchandra vs Kaluraju - 1877
Advocate extra fees in case of wining
Stilk vs Myric 1809 - Ship
deserters case