Considerations

Meaning

& functions

Types
Exceptions
Issues

:
-past consideration
-adequacy
Need not move from promisee or others

Meaning
S.2 (d)
Currie v. Misa
-consist of some right, interest, profit or
benefit to one party or
-some forbearance, detriment, loss or
responsibility given, suffered or
undertaken by the other

Promisor provides consideration

-promise to perform obligation contained
in the proposal

Promisee provides consideration

-promise to do what is requested in the
proposal

Function

A badge of enforceability
A basis for enforcing a promise
-only promise which has a valid
consideration can be enforced
Courts will not enforce a contract
unless it is supported by consideration
Both parties have consideration
If not, will become gratuitous promise

Cutting of grass
=consideration for Alis promise
=benefit Ali gets in return for his
promise
=price that Bala pays for Alis
promise

Types
EXECUTORY
-a promise to do an act in the future

1.

2. EXECUTED
-consideration executed by doing an act
3. PAST
-a promise made after an act is wholly
done

Executory consideration
E.g: A promise to supply books in the
future to B who agrees to pay
A promise for a promise in the future
K. Murugesu v. Nadarajah
-Appellant promised to sell house to
respondent but later refused. Held
promise has consideration

Executed consideration
Consideration is executed by an act of
an individual
E.g.
-Ali offers to give RM10 to anyone who
find his lost cat
-Bala found the cat
-Alis consideration is executed by Balas
act
Carlill v. Carbolic Smoke Ball

Past consideration
Promise made after an act is wholly done
E.g.
-Ali is drowning and crying for help
-Bala hears and saves Ali
-Ali promises to give RM100 for saving his life
Roscoria v. Thomas
-Thomas bought Ds horse
-after sale, D promised that horse free from vice
-But, the horse was vicious
-held: Ds promise was made after sale. X supported by
fresh consideration
-Pt failed in claim

General rule: agreement without

consideration = void

Exceptions (s.26):

a) Natural love and affection

If written, registered (if any) and near relation
EL x recognised natural love as valid
consideration
Re Tan Soh Sim
-agreement lack of feelings (natural love and
affection) and nearness. Thus agreement not
a contract

B) Past consideration
S.26(b) a promise to compensate a person who
voluntarily did something
-for the promisor
e.g. A saves B. B promises to give A RM100
-which promisor was compellable legally to do
E.g. A supports Bs infant. B promises A to pay As
expenses

Past consideration = valid consideration

Kepong Prospecting v. Schmidt

-Tan assisted by Schmidt applied for iron mining
permit. When permit granted, Tan promise to pay
Schmidt 1% of selling prince of iron

English law

Past consideration not good

consideration
X valid (Roscaria v. Thomas)
Except if act done at the promisors
request
Lampleigh v. Braithwait (1615)

Lampleigh v. Braithwait

B was sentenced to death for murder

Requested L to do all he can to get a pardon
for him from the King in London
L run up & down at his own expenses
Finally got B his pardon
B promised to pay L 100 but then failed to
pay
B argued that consideration was past
Held: L entitled to 100 as his service was
done at previous request by B

c) Promise to pay a statutebarred debt

Debt which cannot be recovered thru
legal action due to lapse of time
(6years)
It can be recovered if:
-debtor makes fresh promise
-in writing

Adequacy of consideration

Explanation (2) s.26

Consideration need not be adequate but must be sufficient
As long as the consent is freely given
Valid contract though consideration is inadequate
E.g. A agrees to sell a horse worth $ 1000 for $ 10
But if A denies that his consent was freely given. Court will
examine the adequacy of consideration
Phang Swee Kim v. Beh I Hock
-agreement to transfer land for $1500. Held void due to
inadequacy of consideration. On appeal, there was a good
consideration. Thus, inadequacy of consideration not
important

Consideration need not

move from Promisee
S.2(d) : consideration may move from :
-promisee or other party
-A promise to pay B $ 1000 if C repairs his house
-If C repairs As house, (consideration move from C)
-if A not pay, B can sue A

Venkata Chinnaya v. Verikata Maya

-sister agreed to pay Rs. 653 to brother in
consideration of land given by their mother. Upon
failure, brother can sue sister on her promise. Held to
be valid consideration though not move from brother