Business Law
Aylwin Mathews(4447001)
PART A
“Consideration”
Introduction:
Latimer defines consideration as “something for something” or the exchange of promises from each party-from the promisor to the promise-which turns the agreement into a contract.
Contracts are the basis of the business and therefore understanding the law of contract is essential for persons wishing to engage in business. There would be no business without contracts. To make a contract legally enforceable six prerequisites should be followed. They are intention to create legal relations, agreement, consideration, legal capacity, genuine consent and legal consent. Unlike the other elements, consideration is not necessary in all cases. Some agreements do require consideration to be enforceable while some are enforceable without consideration.
Contracts may be formed by verbal agreement, or may be implied from the conduct of the parties, or may be in writing or evidenced by some written memorandum. The important essential in all simple contracts is that valuable consideration must be present for their validity.
In essence consideration is the price paid by one party in exchange for the other party’s promise. New South Wales Court described it as follows
“ By our law, consideration is an essential requirement for an enforceable contract. Without consideration, a promise is unenforceable at law. The modern theory of consideration has arisen from the notion that a contract is a bargain struck between the parties by an exchange. By that modern theory, consideration must be satisfied in the form of a price in return for the promisor’s promise. The price can be in the form of an act, forbearance or promise”: Beaton vMcDevitt (1987) 13 NSWLR 162 at 168 per Kirby P.
Australian Law is the Common Law which comes from England. “The Common Law is one of the two major and successful legal systems developed in Western Europe and now in force, in one form or another, in America and Great Britain.
PART A
“Consideration”
Introduction:
Latimer defines consideration as “something for something” or the exchange of promises from each party-from the promisor to the promise-which turns the agreement into a contract.
Contracts are the basis of the business and therefore understanding the law of contract is essential for persons wishing to engage in business. There would be no business without contracts. To make a contract legally enforceable six prerequisites should be followed. They are intention to create legal relations, agreement, consideration, legal capacity, genuine consent and legal consent. Unlike the other elements, consideration is not necessary in all cases. Some agreements do require consideration to be enforceable while some are enforceable without consideration.
Contracts may be formed by verbal agreement, or may be implied from the conduct of the parties, or may be in writing or evidenced by some written memorandum. The important essential in all simple contracts is that valuable consideration must be present for their validity.
In essence consideration is the price paid by one party in exchange for the other party’s promise. New South Wales Court described it as follows
“ By our law, consideration is an essential requirement for an enforceable contract. Without consideration, a promise is unenforceable at law. The modern theory of consideration has arisen from the notion that a contract is a bargain struck between the parties by an exchange. By that modern theory, consideration must be satisfied in the form of a price in return for the promisor’s promise. The price can be in the form of an act, forbearance or promise”: Beaton vMcDevitt (1987) 13 NSWLR 162 at 168 per Kirby P.
Australian Law is the Common Law which comes from England. “The Common Law is one of the two major and successful legal systems developed in Western Europe and now in force, in one form or another, in America and Great Britain.
Bibliography: Articles/Books/Reports Clive Turner, Australian Commercial Law(Thomson Reuters, 28th edn, 2011) Atiyah, PS, An Introduction to the law of contract (Oxford University Press, 5th edn, 1995) Carter, JW and DJ Harland, Contract Law in Australia (LexisNexis Butterworths, 4th edn, 2002) Getzler, Joshua ‘Unconscionable Conduct and Unjust Enrichment as Grounds for Judicial Intervention’ (1990) 16 Monash University Law Review 305 Khoury, Daniel and Yvonne Yamouni, Understanding Contract Law (LexisNexis Butterworths, 8th edn, 2010) Latimer,Paul, Australian Business Law (CCH, 29th edn, 2010) Paterson, Jeannie, Andrew Robertson & Arlen Duke, Principles of Contract Law (Thomson Reuters, 3rd edn, 2009) Robertson, Andrew ‘Knowledge and unconscionabilty in unified estoppel’ (1998) 24 Monash University Law Review 130 -----------------------