Contract & Agency Law
Payment, similar to consideration, is one of the four elements of a contract. Consideration is something of value in a contract or agreement between two parties. Both parties must be providing something of value to the other party. It is an act or promise to do (or not to do) something in return for value and the value given is enforceable. All the law need is ‘valuable consideration '. For example, if Jack has offered to pay S$10 for a hammer worth S$100, that is considered valuable consideration. There are three types of consideration in law: executory consideration, executed consideration and past consideration.
In this case study, the agreement of payment between Food Enterprises Ltd and Nerd Private Ltd, clause 2.2 indicates that invoices are to be paid within ten days (10) of receipt of invoices submitted by Nerd Private Ltd. The client (Food Enterprise Ltd) shall pay the consultant (Nerd Private Ltd).
Executory consideration is when a promise, yet to be performed, is given in exchange for another’s promise. Executed consideration is when an act has been performed in exchange of another’s promise. Past consideration refers to an act performed prior to or independent of the promises being exchanged.
In this case study, the payment services and expenses in the Service Terms and Conditions are both executory and executed. The agreement of payment between Food Enterprises Ltd and Nerd Private Ltd, clause 2.2 indicates that the invoices payable within ten (10) days of receipt of invoices submitted by consultant unless otherwise agreed in the Appendix. This means that the consultant has performed their promise; thus the consideration is executed, and the client has yet to perform their promise, hence, it is still executory.
In consideration, it must move from the promise but not necessarily go to the promisor. Consideration also need not be adequate but must be sufficient.
Rules of consideration
1. Consideration must be referable to the
In this case study, the agreement of payment between Food Enterprises Ltd and Nerd Private Ltd, clause 2.2 indicates that invoices are to be paid within ten days (10) of receipt of invoices submitted by Nerd Private Ltd. The client (Food Enterprise Ltd) shall pay the consultant (Nerd Private Ltd).
Executory consideration is when a promise, yet to be performed, is given in exchange for another’s promise. Executed consideration is when an act has been performed in exchange of another’s promise. Past consideration refers to an act performed prior to or independent of the promises being exchanged.
In this case study, the payment services and expenses in the Service Terms and Conditions are both executory and executed. The agreement of payment between Food Enterprises Ltd and Nerd Private Ltd, clause 2.2 indicates that the invoices payable within ten (10) days of receipt of invoices submitted by consultant unless otherwise agreed in the Appendix. This means that the consultant has performed their promise; thus the consideration is executed, and the client has yet to perform their promise, hence, it is still executory.
In consideration, it must move from the promise but not necessarily go to the promisor. Consideration also need not be adequate but must be sufficient.
Rules of consideration
1. Consideration must be referable to the