Lawful Consideration

Hello my reader friends. This is one more blog in the series of Law of Contract. This blog is discussing about " Lawful Consideration". Please read this blog till the end and share it with all law students. These are the notes for preparing exams of Law degree. 

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Lawful Consideration: -

Definition & Meaning: -

Quid Pro Quo means ‘something in return’ which means that the parties must accrue in the form of some profit, rights, interest, etc. or seem to have some form of valuable “consideration”.

As per Section 2(d) of Indian Contract Act, 1872, “When, at the desire of the promisor, the promisee or any other person has done or abstained from doing, or does or abstains from doing, or promises to do or to abstain from doing, something, such act or abstinence or promise is called a consideration for the promise”

Section 25 of the Act declares that an agreement without the consideration is void.

Consideration has been defined as the price paid by one party for the promise of the other. Consideration is “something in return.” It may be some benefit to the party. An agreement is enforceable only when both the parties get something and give something. The something given or obtained is the price of the promise and is called consideration. Consideration in a contract would mean the other person would be giving back something in return. It would be consider as an exchange which would be made between the promisee and promissor.

The agreement to be enforceable by Law must be supported by consideration. An Agreement to do something for others, for nothing, is usually not enforceable. A bare promise without intention to affect legal relations between the parties is of no legal consequence (ex nudo pacto non obitr actio.) Consideration is taken to be the necessary evidence required by law of the intention of the parties to affect their legal position.

Consideration need not be in cash or in kind. A contract without consideration is a ‘wagering contract’ or ‘betting’. Besides, the consideration must also be lawful.

Case Law: -

1. In Currie v. Misa, Justice Lush defined consideration “A valuable Consideration in the sense of law may consist either in some Rights, Interest, Profit or Benefit accruing to one party or some forbearance detriment, loss or responsibility given, suffered or undertaken by the other’.

Example:

1. A agrees to sell his house to B for Rs.10 Lac is the consideration for A’s promise to sell the house, and A’s promise to sell the house is the consideration for B’s promise to pay Rs.10 Lac. These are lawful considerations.

2. A promise to obtain for B employment in the public service, and B promise to pay 10,000 rupees to A. the agreement is void, as the consideration for it is unlawful.

3. For example, if you decide to sell your watch for Rs. 500 to your friend, then your promise to give the rights to the watch to your friend is a consideration for your friend. Also, your friend’s promise to pay Rs. 500 is a consideration for you.

4. A customer C in Pizza Hut orders food which costs Rs. 300. By ordering the food the C is agreeing to pay Rs. 300 as consideration.

Here we are discussing about one of the essentials of a valid contract, listed as follows. All essential features of a valid contract are as follows.

1) Two parties

2) offer and acceptance.

3) Intention to create legal relations

4) Lawful consideration

5) Capacity of parties

6) Free & Genuine consent

7) Lawful objects

8) Writing & registration - legal formalities

9) Certainty

10) Possibility of performance

11) Not expressly declared void.

Thanks for reading till the end. The underlined part in this article is the most important part of this subject and you must write atleast this part in the exam. Also relevant case laws will give you more advantage and an example is must in answer. Please share this blog with all the law students.