There are three requirements of consideration: 1 ) Each party must make a promise, perform an act, or forbear (refrain from doing something). 2) Each party’s promise, act, or forbearance must be in exchange for a return promise, act, or forbearance by the other party.
What are the three types of consideration?
According to Section 2(d) of the Indian Contract Act 1872, there are three kinds of Consideration, viz Past, Present and Future Consideration . In English law consideration May be present or future, but not past.
What are the essential requirements of consideration?
- Consideration must proceed at the desire of the Promisor. ...
- Consideration may move from the promisee or any other person. ...
- Consideration may be past, present or future. ...
- Consideration need not be Adequate. ...
- Consideration must be Real and Not Illusory or Impossible. ...
- Consideration must be Lawful.
What are the types of considerations?
- Executory or Future Consideration: Executory Consideration, as the name suggests is one which is yet to be performed. ...
- Executed or Present Consideration: Executed consideration, means the one which is concurrently provided when the promise is made.
What are the types of consideration?
Common types of consideration include real or personal property, a return promise , some act, or a forbearance. Consideration or a valid substitute is required to have a contract.
What is consideration explain any three features of consideration?
It is the price for a promise – a quid pro quo . It is the value received as incentive for the promise. A contract without consideration is not binding on the parties. Blackstone defined consideration as “the recompense given by the party contracting to the other”.
What are the 4 types of consideration?
The various types of consideration are (1) a promise, (2) an act other than a promise , (3) forbearance, (4) a change in a legal relation of the parties, (5) money, or (6) other property.
What are the 2 types of consideration?
- executed: when the promise has been performed within the meaning of the contract, or.
- executory: when the promise has not been performed.
What are the principles of consideration?
- That consideration is the price paid for promisor’s promise;
- That the person who wants to enforce the promise must be the one who has paid for it – either the promisee or someone acting on their behalf;
- That the consideration does not have to be paid to the promisor.
What elements are required for an offer to be effective under the common law choose 3 answers?
Offers at common law required three elements: communication, commitment and definite terms .
What is consideration explain the elements of consideration?
Meaning of Consideration. Consideration means “something return” or “something which is given and taken .” It refers to something of value given to someone in return for goods, services or some other promise. It is the price paid for contract.
What is consideration explain the characteristics of consideration?
The term “consideration” is a concept in English law that refers to the price paid in exchange for the fulfillment of a promise. ... Its main characteristic is that the promissor must give a promise of something that is of value, and the promisee must give something of value in exchange .
What are examples of consideration?
The definition of consideration is careful thought or attention or compassionate regard for someone or something. An example of consideration is someone deciding between two options for dinner . An example of consideration is someone bringing a friend dinner who just had a baby.
What is consideration and what are the two basic elements of consideration?
Thus, there are two basic elements to consideration: (1) Legal Sufficiency (something of value in the eye of the law) and (2) bargained for exchange . Both must be present to satisfy the requirement of consideration.
What are the six types of consideration?
- Executory (Future) Consideration.
- Executed (Present) Consideration.
- Past Consideration.
- Conditional Consideration.
- Unreal Consideration.
- Illegal Consideration.
What is consideration and its rules?
Consideration Meaning in Law
Consideration is the foundation on which any contract is built . ... Consideration has to move as per the desire of the promisor. Consideration may move from the promisee to another person. Consideration might be in the past, present, or future. Consideration does not need to be adequate.
Why is consideration needed in a contract?
When forming a contract, consideration is needed in order to make the agreement a formal, valid contract. ... Consideration is needed so that both parties incur some sort of burden or obligation in the agreement . Without consideration, the exchange would likely be classified as a gift.
What are the requirements of a valid acceptance?
- 1] Acceptance can only be given to whom the offer was made. ...
- 2] It has to be absolute and unqualified. ...
- 3] Acceptance must be communicated. ...
- 4] It must be in the prescribed mode. ...
- 5] Implied Acceptance.
What are the 3 elements of an offer?
- (1) The offer must be Communicated.
- (2)Terms of the offer must be clear and definite.
- (3)Must create a legal relationship.
- (1) Must be unconditional and absolute.
- (2) Must be expressed in some usual and reasonable manner.
What are the requirements of acceptance?
- The acceptance must be communicated. ...
- The offer must be accepted without modifications, otherwise it is a counter-offer.
- Until an offer is accepted it may be revoked. ...
- Only the person to whom the offer is made can accept.
- Acceptance will be judged by an objective standard.
How do you determine consideration?
How is Consideration Determined? Basically, a consideration is determined when the two or more parties to a contract change their positions , such as promising something you are not legally required to do or promosing not to do something you are legally free to pursue.
What is a simple definition of consideration?
consideration. n. 1) payment or money . 2) 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.
Does consideration need to be adequate?
Consideration need not be adequate – It is not necessary that the consideration is equal or adequate for the promise made. However, it is mandatory that the consideration should be something in which the law attaches some value. It is for the parties to decide the value of the consideration and not a court of law.
What are the five rules of consideration?
Legal rules regarding consideration
Consideration must move from the promisee but need not flow to the promisor. Consideration must be sufficient but need not be adequate. Consideration cannot be illusory. Consideration must not be past .
