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Contract Assignment
Contract Assignment
Department of law
Explanation
Payment or money a vital element in the law of contracts, consideration is a benefit
which must be bargained for between the parties, and is the essential reason for a
party entering into a contract. Consideration must be of value (at least to the parties),
and is exchanged for the performance or promise by the other party (such
performance by the other party) such performance itself is consideration. In a
contract, one consideration thing given is exchange for another consideration.
Principles Of Consideration
There are several principles applicable to consideration in contract law. These are:
There are some situations where an act, promise or forbearance cannot be taken to be
legal consideration in contract law. These situations are where there is some existing
duty to do these things, and they are either done either:
Where parties that are contracting seek to end an obligation under a contract, there
must be some consideration for discharging that obligation. Otherwise, the original
contractual obligations may still apply. The performance or forbearance that is the
consideration for the discharge of the obligation or obligations must be something
different to the obligation under the original agreement.
Promissory Estoppel
In some situations, even where there is found to be no consideration in contract law, a
remedy may be available where one party has acted on a representation made by
another party. The doctrine that governs this situation is called promissory estoppel.
This doctrine stops a party from going back on a promise where it would be
unconscionable to do so.
Promissory estoppel cannot be brought as a new cause of action. That is to say that
the party pleading promissory estoppel must have a cause of action that is
independent of promissory estoppel. Further, promissory estoppel does not override
the requirement for consideration in contract law. It also does not make voluntary
promises enforceable. The doctrine of promissory estoppel also does not terminate
the rights of a promisor. It merely suspends them.
Contract law teaches us whether a promisor is legally obligated to keep his promise.
The person making the promise is called the promisor. The person to whom he
makes the promise is a promisee.
For example, if Mr. A promises to pay Mr. B $500 then A is the promisor and B is the
promisee. Contract law tells us whether Mr. A is liable if he breaks his promise.
If Mr. A promises to pay Mr. B $500 and Mr. B says, “Great! Now I can get that
tablet computer I always wanted”, Is A in legal trouble if he decides not to pay?
Contract law tells us whether the promisor, Mr. A, must keep his promise.
Consideration must move at the desire of the promisor: An act shall not be a valid
consideration for the promise unless it is done at the desire of the promisor. So the act or
abstinence must be done or promised to be done at the desire of the promisor. It is not
necessary that the promisor himself should be benefited by his act, but his desire is essential.
Example: D, on the order of the Collector of a district, built at his own expense certain shops
in a bazar. The shops were occupied by different shopkeepers who promised to pay D a
commission on articles sold. In a suit filed by D to recover the commission it was held. that
the promise was not supported by consideration since the market was not constructed at the
Consideration may be past, present or future: Where the promisor has received
consideration before the date of the promise, it is past consideration. When the promisor
receives consideration simultaneously with his promise, it is present consideration. Where the
promisor has to receive consideration in future for his promise, it is future consideration.
which the consent of the promisor is freely given is not void merely because the
consideration is inadequate. This means that consideration need not be adequate to the
promise.
For example
If “A” promises to wash “B” car if “B” promises to pay,”C”10$, then if “A” does, in fact
wash the car and “B” subsequently fails to pay the 10$ to “C” “C” cannot enforce the
contract against “B” since “C” has not furnished any consideration. It may, of course, be
possible for “A” to enforce the promise against B. The rule is really a corollary of the rule
that only the parties to a contract can sue on the contract.
a marriage and agreed between themselves that the husband would have a right of action
to sue should either parent fail to pay. The wife’s father died before he could make the
payment and his executors refused to pay. The husband sued the executors. It held that his
action must fail because he had furnished no consideration under the agreement.
“It should be noted that whilst the consideration must move from the promisee, it need
not move to the promisor. The promisee may suffer some detriment at the request of the
What this means it that the law requires the parties to have entered into a bargain where
each side has provided something of value that the courts can see. The courts are not
generally interested in whether this is the full market value, or whether the contract is a
fair bargain. That is for the parties to negotiate for themselves. The term “sufficiency”
describes something that the courts can see of value that makes the bargain binding,
whilst “adequacy” may describe the full value of something. Hence, the law requires
consideration to be something of sufficient value, but not necessarily the full or adequate
market value.
consideration is enforceable if, it is expressed in writing and registered under the law for the
time being in force for the registration of documents, and is made on account of natural rove
and affection, between the parties standing in near relation to each other.
Case Regarding promisee consideration
SYNOPSIS
1 CASE
2 INTRODUCTION
3 FACTS
4 ISSUES
5 HELD
6 COMMENT
INTRODUCTION
This case is based on the offer made to a particular person. In Contract Law, an offer is a
KINDS OF OFFER
GENERAL OFFER – General offer is made to the public at large. It may be accepted by
FACTS
The defendant i.e. Jones sent a written order for goods to a shop which is owned by
Brocklehurst and which was addressed to him by name. Unknown to the defendant,
Brocklehurst had earlier that day sold and transferred his business to Boulton.But Boulton
fulfilled the order and delivered the goods to the defendant without notifying him that he
had taken over the business. The defendant accepted the goods and consumed them in the
belief that they had been supplied by Brocklehurst. When he received Boulton’s invoice
he refused to pay it claimimg that he had intended to deal with Brocklehurst personally,
since he had dealt with them previously and had a set-off on which he had intended to
rely.
ISSUES
2 Is it the duty of the Brocklehurst or Boulton to inform about the takeover of the
business to Jones?
3 Can Boulton claim the amount of the goods which was used by the Jones?
HELD
The court held that the defendant i.e. Jones was not liable for the price. When a Contract
is made for the identity of the person is important to the Contract. Hence, there was no
Contract. “POLLOCK” said that the rule of law is clear, that if you propose to make a
contract with A, then B cannot substitute himself for A without your consent and to your
with A alone, B can never force a contract upon him, he was dealt with A, and a contract
“BRAMWELL B” said that I do not lay it down because a contract was made in one
person’s name another person cannot sue upon it, except in cases of agency.
“CHANNELL B” said that the plaintiff is clearly not in a situation to sustain this action,
for there was no contract between himself and the defendant. The case is not one of
Principal and agent; it was a contract made with B, who had transactions with the
defendant and owed him money, and upon which A seeks to sue.” So, the Jones will not
be liable to pay {Section 64 will also apply} which talks about rescissions of a voidable
contract.