875:
invariable test of the existence of a consideration rather than whether it can be constituted by benefit to the promisor). The second is "bargain theory," in which the parties subjectively view the contract to be the product of an exchange or bargain. Bargain theory has largely replaced benefit-detriment theory in modern contract theory, but judges often cite both and may use both models in their decisions. These theories usually overlap; in standard contracts, such as a contract to buy a car, there will be both an objective benefit and detriment. However, there are certain contracts which satisfy one but not the other. For instance, a deal in which the promisee feels subjectively relieved, but has not actually gained any legal rights, might satisfy the bargain theory but not the benefit-detriment theory. Alternatively, a deal in which an actor takes detrimental actions possibly in reaction to an offer, without having viewed the deal as a bargain, would not be viewed as a contract under the law.
890:. However, in other jurisdictions, the court will reject "consideration" that had not been truly bargained for. Occasionally the courts in these jurisdictions may refer to "adequate" or "valuable" consideration, but in reality the court is not examining the adequacy of consideration, but whether it had been bargained for. The traditional notion that courts won't look into the adequacy of consideration, an ancient notion in the English common law, doesn't square with the benefit-detriment theory (in which courts are implicitly analyzing if the parties are receiving a sufficient benefit) but does square with the bargain theory (in which only the subjective intentions of the parties are considered).
832:, or one which the promisor actually has no obligation to keep, does not count as consideration. The promise must be real and unconditional. This doctrine rarely invalidates contracts; it is a fundamental doctrine in contract law that courts should try to enforce contracts whenever possible. Accordingly, courts will often read implied-in-fact or implied-in-law terms into the contract, placing duties on the promisor. For instance, if a promisor promises to give away a third of his earnings for the year and earns nothing, he has no actual obligation to do anything.
850:
promisor—is enforceable provided the promissee was harmed in conferring a benefit on the promisor and the promise is not disproportionate to the benefit. The promise to pay a debt discharged by bankruptcy, the promise to perform a conditional responsibility despite the nonoccurrence of the condition, and the promise to perform on a voidable contract form a category of moral obligations that can bind in the absence of consideration.
809:). Thus, they have fulfilled the first requirement of consideration. To meet the second element, there must be a mutual exchange. In this case, the landlord provides housing, while the tenant provides rent payment. Third, the bargain terms must be of value. The apartment is worth what the tenant hands over each month. Therefore, this contract has met its consideration requirement, because it fits all elements of consideration.
49:
899:
likely to commemorate, or at least remember, a promise made due to a bargaining process. The third is the channeling requirement - parties are more likely to coherently stipulate their specific desires when they are forced to bargain for them. Each of these rationales ensure that contracts are made by serious parties and are not made in error.
775:
otherwise legally obligated to do, it may be said that he has given consideration. For example, Jack agrees to sell his car to Jill for $ 100. Jill's payment of $ 100 (or her promise to do so) is the consideration for Jack's promise to give Jill the car, and Jack's promise to give Jill the car is consideration for Jill's payment of $ 100.
878:
The main purpose of the shift from benefit-detriment to bargain theory is to avoid inquiries into whether consideration is adequate. For example, if a person promised you their car for $ 1.00 because they needed to get rid of it, then the $ 1.00 might seem adequate. However, if it were your birthday
774:
and is required, in most cases, for a contract to be enforceable. Consideration is the price one pays for another's promise. It can take a number of forms: money, property, a promise, the doing of an act, or even refraining from doing an act. In broad terms, if one agrees to do something he was not
898:
There are three main purposes cited for the consideration requirement. The first is the cautionary requirement - parties are more likely to look before they leap when making a bargain than when making an off-the-cuff promise of a gift. The second is the evidentiary requirement - parties are more
849:
agreements (as opposed to the creation of a new lease agreement) do not require consideration, nor do modifications to existing sale contracts. Furthermore, a promise to perform a moral obligation—the classic example is of a promise to support a person injured while coming to the rescue of the
874:
There are two common theories that attempt to explain consideration. The first is "benefit-detriment theory," in which a contract must be either to the benefit of the promisor or to the detriment of the promisee to constitute consideration (though detriment to the promisee is the essential and
879:
and your friend wrote down "I give you my car in consideration of one dollar," this same consideration would not seem adequate. Thus whether $ 1.00 is consideration does not depend on the benefit received but whether the $ 1.00 had actually been bargained for.
1201:
310:
818:
Past consideration is not valid. Something that is already done is done, and it does not change the legal position of the promisor. Any goods or services to be exchanged must be exchanged at or after the time of contract
1284:
1194:
315:
1038:
1085:
1440:
794:
2. A performance or return promise is bargained for if it is sought by the promisor in exchange for his promise and is given by the promisee in exchange for that promise.
529:
1118:
1099:
578:
1208:
703:
270:
1596:
1388:
1031:
1291:
1544:
688:
3 Historically restricted in common law jurisdictions but generally accepted elsewhere; availability varies between contemporary common law jurisdictions
1569:
1024:
797:
3. The performance may consist of an act other than a promise, or a forbearance, or the creation, modification, or destruction of a legal relation.
1499:
1173:
1166:
1078:
748:
801:
An example of this is renting of apartment. The landlord and tenant come together to discuss the terms of the exchange (most of the time, the
1381:
1215:
1693:
989:
784:
1180:
1277:
1092:
334:
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1315:
31:
1395:
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1222:
327:
1343:
918:
593:
183:
1433:
78:
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1374:
1137:
1047:
741:
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339:
1187:
588:
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1110:
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395:
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1426:
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959:
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227:
1528:
863:
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136:
1506:
1337:
734:
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1148:
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601:
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288:
167:
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68:
1635:
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357:
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113:
93:
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883:
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1664:
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131:
88:
17:
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1417:
1367:
1354:
829:
523:
410:
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205:
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30:
This article is about consideration under
American law. For an English focused article, see
1610:
1270:
1249:
908:
526:(also implied covenant of good faith and fair dealing or duty to negotiate in good faith)
415:
145:
122:
962:
1625:
1490:
1479:
1310:
887:
720:, and Canadian jurisprudence in both Québec and the common law provinces pertaining to
661:
552:
483:
468:
216:
63:
862:, generally require consideration to modify a contract (because of what is called the
1687:
1358:
762:
452:
200:
173:
103:
975:
1128:
841:
Modern contract theory has also permitted remedies on alternative theories such as
656:
651:
638:
429:
83:
48:
948:
858:
Service contracts and, in the United States, other contracts not governed by the
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400:
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767:
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1016:
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322:
1202:
Arizona
Cartridge Remanufacturers Ass'n Inc. v. Lexmark International Inc.
842:
806:
771:
477:
372:
195:
40:
443:
1011:
886:" consideration will be upheld unless a particular contract is deemed
846:
802:
1285:
Atlantic Marine
Construction Co. v. United States District Court
1195:
In re Zappos.com, Inc., Customer Data
Security Breach Litigation
633:
1020:
882:
In some jurisdictions, contracts calling for such nominal or "
623:
791:
1. A performance or a return promise must be bargained for.
787:
states that the elements of consideration are as follows:
1086:
Kansas City
Wholesale Grocery Co. v. Weber Packing Corp.
713:
both in Québec and in the country's common law provinces
716:
7 Specific to civil law jurisdictions, the
American
1654:
1634:
1624:
1579:
1554:
1527:
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1416:
1409:
1353:
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1239:
1147:
1127:
1109:
1061:
1054:
1441:Douglas v. U.S. District Court ex rel Talk America
1119:Baltimore & Ohio Railroad Co. v. United States
1010:, 'The Effect of Options on Consideration' (1925)
530:Contract A and Contract B in Canadian contract law
1100:Lefkowitz v. Great Minneapolis Surplus Store, Inc
1597:Helene Curtis Industries, Inc. v. United States
1209:Step-Saver Data Systems, Inc. v. Wyse Technology
1389:G. L. Christian and Associates v. United States
789:
685:2 Specific to civil and mixed law jurisdictions
1032:
742:
8:
1292:Salsbury v. Northwestern Bell Telephone Co.
837:Exceptions to the Consideration Requirement
722:contractual and pre-contractual negotiation
1631:
1545:Lenawee County Board of Health v. Messerly
1524:
1413:
1058:
1039:
1025:
1017:
749:
735:
36:
27:Concept in common law as applied in the US
1570:SCO Group, Inc. v. DaimlerChrysler Corp.
1079:Gottlieb v. Tropicana Hotel & Casino
1500:Williams v. Walker-Thomas Furniture Co.
1174:Ticketmaster Corp. v. Tickets.com, Inc.
929:
669:
621:
560:
539:
509:
467:
428:
385:
349:
278:
240:
121:
55:
39:
518:Duty of honest contractual performance
1382:Henningsen v. Bloomfield Motors, Inc.
1216:Bowers v. Baystate Technologies, Inc.
706:of International Commercial Contracts
7:
974:Brantly, William Theophilus (1912).
695:and other civil codes based on the
1181:Nguyen v. Barnes & Noble, Inc.
845:. Also, modifications to existing
25:
785:Restatement (Second) of Contracts
1316:Jacob & Youngs, Inc. v. Kent
1278:King v. Trustees of Boston Univ.
1093:Ever-Tite Roofing Corp. v. Green
825:does not count as consideration.
520:(or doctrine of abuse of rights)
335:Enforcement of foreign judgments
299:Hague Choice of Court Convention
47:
32:Consideration under English law
1396:Kellogg Bridge Co. v. Hamilton
1257:Wood v. Lucy, Lady Duff-Gordon
1223:Bragg v. Linden Research, Inc.
1012:34(6) Yale Law Journal 571-590
766:is the central concept in the
328:Singapore Mediation Convention
1:
1344:MacPherson v. Buick Motor Co.
702:5 Explicitly rejected by the
469:Quasi-contractual obligations
18:Consideration in American law
919:Consideration in English law
1434:Harris v. Blockbuster, Inc.
1710:
1694:United States contract law
1645:Drennan v. Star Paving Co.
1465:(unwritten & informal)
1375:Seixas and Seixas v. Woods
1138:Ellefson v. Megadeth, Inc.
1048:United States contract law
340:Hague Judgments Convention
29:
1410:Defense against formation
1188:ProCD, Inc. v. Zeidenberg
980:. M. Curlander. pp.
894:Purposes of Consideration
870:Theories of Consideration
779:Elements of consideration
691:4 Specific to the German
1590:United States v. Spearin
1111:Implied-in-fact contract
1072:Leonard v. Pepsico, Inc.
396:Anticipatory repudiation
146:unequal bargaining power
1427:Morrison v. Amway Corp.
1303:Substantial performance
1230:Feldman v. Google, Inc.
860:Uniform Commercial Code
718:Uniform Commercial Code
693:BĂĽrgerliches Gesetzbuch
378:Third-party beneficiary
350:Rights of third parties
228:Accord and satisfaction
864:pre-existing duty rule
799:
449:Liquidated, stipulated
294:Forum selection clause
179:Frustration of purpose
1507:Buchwald v. Paramount
1338:De Cicco v. Schweizer
854:Contract modification
813:Lack of Consideration
711:Canadian contract law
79:Abstraction principle
1063:Offer and acceptance
914:English contract law
540:Related areas of law
439:Specific performance
289:Choice of law clause
254:Contract of adhesion
168:Culpa in contrahendo
74:Meeting of the minds
69:Offer and acceptance
1636:Promissory estoppel
1521:Cancelling Contract
843:promissory estoppel
704:UNIDROIT Principles
478:Promissory estoppel
358:Privity of contract
311:New York Convention
271:UNIDROIT Principles
114:Collateral contract
109:Implication-in-fact
94:Invitation to treat
1563:Stoddard v. Martin
1538:Sherwood v. Walker
1448:McMichael v. Price
1264:Kirksey v. Kirksey
1167:Specht v. Netscape
1055:Contract formation
524:Duty of good faith
421:Fundamental breach
387:Breach of contract
316:UNCITRAL Model Law
280:Dispute resolution
265:Contra proferentem
259:Integration clause
233:Exculpatory clause
1678:
1677:
1674:
1673:
1665:Britton v. Turner
1656:Unjust enrichment
1620:
1619:
1581:Misrepresentation
1516:
1515:
1459:Statute of frauds
1405:
1404:
805:is outlined in a
759:
758:
602:England and Wales
510:Duties of parties
501:Negotiorum gestio
490:Unjust enrichment
211:Statute of frauds
160:Unconscionability
132:Misrepresentation
89:Mirror image rule
16:(Redirected from
1701:
1632:
1604:Laidlaw v. Organ
1525:
1473:Buffaloe v. Hart
1461:(written) &
1418:Illusory promise
1414:
1368:Hawkins v. McGee
1355:Implied warranty
1059:
1041:
1034:
1027:
1018:
996:
995:
971:
965:
957:
951:
943:
937:
934:
830:illusory promise
823:Preexisting duty
751:
744:
737:
579:China (mainland)
548:Conflict of laws
411:Efficient breach
406:Exclusion clause
206:Illusory promise
189:Impracticability
51:
37:
21:
1709:
1708:
1704:
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1702:
1700:
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1679:
1670:
1650:
1616:
1611:Smith v. Bolles
1575:
1550:
1512:
1485:
1453:
1401:
1349:
1320:
1297:
1271:Angel v. Murray
1250:Hamer v. Sidway
1235:
1143:
1123:
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1045:
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999:
992:
977:Law of Contract
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944:
940:
935:
931:
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909:US contract law
905:
896:
872:
856:
839:
815:
781:
755:
726:
598:United Kingdom
561:By jurisdiction
35:
28:
23:
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15:
12:
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5:
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1626:Quasi-contract
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1491:Unconscionable
1487:
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1480:Foman v. Davis
1476:
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1466:
1463:Parol evidence
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1311:Lucy v. Zehmer
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938:
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904:
901:
895:
892:
888:unconscionable
871:
868:
855:
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838:
835:
834:
833:
826:
820:
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811:
780:
777:
757:
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739:
731:
728:
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709:6 Specific to
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678:1 Specific to
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553:Commercial law
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217:Non est factum
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1360:
1359:caveat emptor
1356:
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1241:Consideration
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1120:
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1023:
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1019:
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1005:
1001:
993:
991:1-4368-8453-5
987:
983:
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942:
939:
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910:
907:
906:
902:
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763:Consideration
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657:Criminal law
639:Property law
594:Saudi Arabia
499:
482:
263:
215:
166:
84:Posting rule
41:Contract law
1330:3rd parties
949:§ 2A-208(1)
495:Restitution
306:Arbitration
1628:obligation
1555:Illegality
1159:agreements
1157:Browsewrap
1149:Shrinkwrap
1002:References
963:§ 2-209(1)
884:peppercorn
819:formation.
768:common law
697:pandectist
680:common law
460:Rescission
368:Delegation
363:Assignment
151:Illegality
99:Firm offer
1153:Clickwrap
1008:AL Corbin
772:contracts
699:tradition
569:Australia
416:Deviation
323:Mediation
56:Formation
1688:Category
903:See also
807:contract
662:Evidence
634:Tort law
607:Scotland
430:Remedies
373:Novation
196:Hardship
123:Defences
64:Capacity
1529:Mistake
1326:Privity
803:leasing
652:estates
584:Ireland
201:Set-off
142:Threats
137:Mistake
1328:&
988:
960:U.C.C.
946:U.C.C.
650:, and
648:trusts
622:Other
574:Canada
925:Notes
847:lease
670:Notes
644:Wills
626:areas
589:India
451:, or
401:Cover
986:ISBN
783:The
153:and
144:and
936:§71
866:).
828:An
770:of
624:law
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20:)
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