Is Past consideration valid in England?
Is Past consideration valid in England?
In English, Law consideration may be present or future but not past. Past consideration is no consideration at all in English Law. Hence an agreement based on past consideration is void.
Is Past consideration valid in contract law?
Generally, past consideration is not a valid consideration and has no legal value. Past consideration is consideration that has already flowed from the promisee to the promisor. That is, the promisee’s act or forbearance predates the promisor’s promise.
What does past consideration mean in contract law?
A past promise or act which forms the basis of a future promise. A promise is said to be given for moral or past consideration when the promisor’s motivation for making the promise is a past benefit he received that gave rise to a moral, but not legal, obligation to make compensation.
How can Past consideration affect a contract?
The term “past consideration” refers to an act that was performed, or a promise that was made, before the new promise that is at issue and is being attempted to be enforced. Under the law, past consideration cannot constitute consideration for the new contract because it was not given for that new promise.
Why is past consideration invalid?
Past consideration cannot be included in a contract mostly because it did not benefit the promisor or pose any risk to the promisee. For a contract to be valid, it absolutely must include consideration.
Why is past consideration bad?
Past conduct Something said afterwards, will not count as consideration. For example, if X promises to reward Y for an act that Y had already performed then while the performance of that act is good consideration, for the promise to be rewarded for it is past consideration and therefore not good consideration.
What is the general rule on past consideration?
The general rule that past consideration is not good consideration is important to remember when determining whether adequate consideration has been provided to formalise contractual relations. This means that consideration must be provided either during or after the formation of the contract.
What is an example of past consideration?
For example, imagine that you are gifted a car for your birthday, and you later promise the person who gave you the car to repay them. Your promise cannot be enforced, as the car was given as a gift. Also, promises for past consideration are only enforceable if the promisor benefited in some way from the consideration.
Why is past consideration usually enforceable?
A promise for past consideration can be enforced if there was a voidable obligation involved. For example, if a sports franchise signs a minor athlete to a contract, the athlete could hold the franchise to the contract after they turn 18. A promise to pay a debt that was eliminated by bankruptcy is also enforceable.
What is past consideration example?
A promise is said to be given for past consideration when the promisor’s motivation for making the promise is a past benefit he received that gave rise to an obligation to make compensation. Earlier past consideration was no consideration but now it is a good and valid consideration. Example : B house is on fire.
