When does the question of consideration arise?

Introduction:

Consideration is a fundamental part of the contract. When you look at the benefits of promises and the detriment to promises in two ways, you really should understand promises in terms of detriment provided by English law. As result to conclude a legally binding contract, for a promise to perform or ignore certain behavior, it is sufficient as long as the promise reaches a common agreed value, and the behavior damages the promise and/or supports the debtor’s promise as the final result. It is necessary to give consideration when the contract is concluded or before the contract is concluded. Therefore, there is no doubt that when considering the value of promises, considerations made prior to reaching an agreement will never be considered part of the obligation. In this case, action is interpreted as satisfaction or change.

Consideration

Consideration explains why the parties entered into the contract and what it received as contracting parties. In order for the contract to be valid, it must include all relevant considerations. In principle, it must be taken into account that the parties benefit from the conclusion of the contract. Contract; when you pay for goods in the store and receive the goods, this is your consideration. In order to qualify, both parties must change their positions. According to Article 2(d) of the Indian Contract Law of 1872, “the promisor, promisee or other person performs or waives or promises to perform or fails to perform according to the will of the promisor. Doing, doing, waiving, or making a promise is called a consideration for the promise”

In Currie v Misa [(1874) LR 10 Ex 153], Justice Lush in this case defines consideration as “valuable consideration in the legal sense, which can also include rights, benefits or benefits attributable to one party. Or another party Any tolerance, damage, loss, or liability that is transferred, incurred or assumed.

Few General Facts Relating to Consideration

• Consideration is that doing or not doing something that the promisor desires to be done or not done.
• Consideration has to be at the desire of the promisor.
• Consideration might move from the promise of every other person
• Consideration may also be past, present, or future.
• Consideration need not be competent but should be real.

Consideration may be Past, Present, Or Future Section 2(d) of Indian Contract Act 1872

Past consideration: When one thing is completed or suffered before the date of the agreement, at the need of the promisor, it’s called ‘past consideration.’ It has to be noted that past consideration is ideal consideration as long as it’s given by the promisee, ‘at the desire of the promisor.

Illustrations:

• B’s home is on fire. A runs to B’s assist and saves his life. In an exceedingly show of gratitude, B promises to pay A ` 5,00,000 for the assistance provided by A. in this case, B’s motivation for creating this promise is that the past benefit that A provided gave rise to the duty to compensate A.
• If David agrees to service my vehicle then proceeds to fit new alloy wheels and a top-of-the-range satnav completely without having agreed on this with me and that I will be pleased with the work adjusted to pay him an additional $400. If I later say that I am not ready to get the extra work and product, David will not be ready to enforce payment. The agreement was for vehicle service. My promise to get the extra services and products came when David allotted his act (which wasn’t within the vehicle service agreement). This is often past consideration and under the common law rule in Stilk v Myrick, [1809] EWHC KB J58, 170 ER 1168, past consideration is not good consideration. Agreements falling within this field cannot be enforced.

Present consideration: Consideration that action at the same time with the promise is termed ‘present consideration’ or ‘executed consideration’

Illustration: A buys goods from B at a price of 15,000 A, and makes money from B immediately. Consideration is “Present”.

Future considerations: When the consideration of a certain action needs to be a carryover to a certain date in the future, this is called “future considerations” or “mandatory considerations.” It consists of exchange promises, each of which cancels out each other.

Illustration: Pihu promised to sell and deliver a new phone case to Ramesh within a week. Ramesh accepts the offer and promises to pay within one month after receiving the watch. This is Executory or future consideration.

What is the necessity of consideration?

Only the promise of rewards needs to be fulfilled because any promise that is not promised is sometimes hasty and carelessness.

According to the contract, the reason for issuance of the consideration is very important because it levies a form of a burden on the parties to fulfill the terms of the contract. In Durga Prasad v. Baldeo [(1881) ILR 3A LL 221] Durga Prasad personally built several shops on the market on behalf of urban collectors. The merchandise occupying these stores promised to pay Durga Prasad a sales commission. Durga Prasad did not receive a commission and filed a lawsuit against the shopkeeper. The court held that because the store was established under the order of the collector, not at the request of the shopkeeper, the promise was not supported by consideration and therefore cannot be recovered.

Validity of an agreement without consideration (Section 25 of ICA)

 The standard rule is that an agreement made with consideration is extremely important. A contract may only be enforceable when an adequate consideration is extremely important. However, the Indian Contract Act consists of certain exceptions to the present rule. In the subsequent cases, the agreement, though made without consideration, is valid and enforceable · 

• Natural love and affection – In Rajluck Dabee v. Bhootnath Mookerjee (1900) 4 Cal WN 488, held that close to the relation among the 2 parties does not always imply natural love and affection among them. In this case, the defendant promised to pay his spouse a fixed amount of money every month for her separate residence and maintenance. The court should find no hint of love and affection among the parties. The agreement was held to be void for loss of consideration. ·     
• Compensation for past voluntary service (sec25(2)) ·       
• Promise to pay a time-barred debt (sec 25(3) ·      
• Agency – as per section 185 of the Indian contract act, no consideration is essential to create an agency.

Illustration: A promises to keep B’s assets free and B allows A to keep the same. Therefore, A will be the promisor, and B will be promised. In this case, the question arises: Will B provide consideration to A’s promise to preserve wealth? The answer must be yes because damage or inconvenience B will be separated from the goods, so A can also transport the goods, which is a full consideration for fulfilling the promise. Damage caused by loans or liabilities. The promise may or may not get some consideration from the promise, but in most cases, the promisor will get some benefit from the consideration, which can be described as a consideration of the promise made by the promising Abdul Aziz (VS) Masum Ali (1914) ILR 36 all 268, The secretary of the Mosque Committee filed a lawsuit to ensure that the promise of signing Rs.500 to rebuild the mosque is fulfilled. “Since” because the promised person did not get a sense of mutual benefit, and the secretary of the promised committee, since then, no harm (liability) has nothing had been done to hold out the repairs. Hence the suit was dismissed.

How to measure consideration?

In order to get consideration, each party must adapt to the change of position by promising to do something or not to do something.

 For example, a company that promises to remove billboards that are very similar to yours. As a billboard, to refuse to file a lawsuit against trademark infringement. Legally speaking, the company does not have to delete the billboard; you have the right to file a lawsuit. These commitments must be given due consideration. The consideration must be close to the value of the goods or services provided, which is usually based on the value of the goods at the time the contract was signed. The consideration does not have to match the exact quantity of the item. If one party promises to pay the other party $500 to buy a computer, but the specific cost of the computer is $520, most courts consider it sufficient for proper consideration.

When the question of consideration does arise after the proposal has been accepted

Pipraich Sugar Mills Ltd. Vs. Pipraich Sugar Mills Mazdoor Union [1956 SCR 872: AIR 1957 SC 95: (1957) 1LLJ 235] on January 3, 1951, to pay 25% of the profit from the sale to workers.it made it clear that the strike will be suspended immediately, today. That was not done. On the other hand, the defendant put forward some counter-proposals in a letter dated January 5, 1951, and on January 8, 1951, the management replied that if the strike notice is withdrawn, they will reconsider its terms. On January 3, 1951, it was rejected and expired. Then, on January 10, 1951, the management made another offer. The respondent did not agree with the decision to withdraw the notice and responded to it on January 10, 1951; he made it clear that Kashinath Pandey was waiting for the final decision. Only when the defendant accepted the proposal contained in the letter to make the agreement, would it consider whether to take into account the management promise from January 3 to 10, 1951. There is no consensus between the parties. As the court itself decided, there will be no new questions about whether it is supported by consideration. This may become one of the terms of the service.

The exceptions to the consideration requirement include the following (Section 25 of the ICA)

• Charity: If one person assumes legal responsibility for another person’s commitment to charity, the contract is valid. ·
•  Promissory estoppel means that the court will not allow the debtor to declare that no consideration has been given. When the following three conditions are met, the doctrine of estoppel change is applied for judicial justice:
  1. A promise that the promisor must reasonably expect to behave or not in an accurate and substantive manner;
  2. Take action or tolerance;
  3. Injustice may be avoided only by implementing the promise.

In Estate of Timko v. Oral Roberts Evangelistic Assn., [215 N.W.2d 750 (Mich. App. 1974)], Timko is a member of the school board. He sponsored a large number of school purchases. In order for the trustee to vote on the acquisition, he promised to help with the acquisition and pay the purchase fee minus the payment at the end of 5 years. Timko died 4 years later. The school sued his property and defended him on the grounds that he had not fulfilled his promise. Timko was in return or given nothing reciprocally, and there is no direct benefit to buying a building (this can enable the implementation of unilateral contractual). The court held that Timko’s property was liable.

Case Analysis

In Kedar Nath v. Gorie Mohd. [(1886) ILR 14 Cal 64]

According to the promised subscription, the plaintiff and the contractor signed a contract for the construction of the town hall. This happened at the request of the defendant (the promisor) in order to constitute.

Doraswamy Iyer vs. Ayyar [AIR 1936 Mad 135]

The plaintiff had started temple maintenance at the time of subscription. He argued that the move was not triggered by a promise, but was completely independent of the promise. As a result, subscribers (respondents) who promised to pay but were later rejected were not prosecuted. If no action is taken to support the funds raised, then a simple pledge to join a charity will not be held responsible.

Lampley v. Braithwaite [1615] EWHC KB J17 is an exception

An act must be carried out at the request of the promisor. All parties must understand that this action will be rewarded in some way. If promised in advance, payment should be legally mandatory.

A special exception under UCC Regulations

UCC allows parties not to consider claims or corrections due to a breach of contract by the substitute party. This is achieved by providing the substitute party with a signed written waiver or waiver. Article 1-107 of the Commercial Code applies to all contracts signed by UCC and is not limited to the sales provisions of Section 2.

Conclusion

Consideration is a service that must be reached between the two parties, and it is also an important reason for one of the parties to enter into a contract. The consideration must be valuable and must be exchanged for fulfillment or promise fulfillment (this fulfillment itself is a consideration). Contract, the consideration (this matter) is exchanged for another consideration. Contrary to established national policies, illegal or more or less unethical behavior cannot be used as the basis for concluding a contract. The most urgent task is to consider during contract negotiation or after the contract is concluded. Therefore, if the value of the promise is a consideration, it should be considered before signing the agreement. It was never considered part of the contract.