Doctrine of Promissory Estoppel
Consideration is an essential element in the formation of a contract. Consideration may be a promise to carry out an action or a promise to refrain from carrying out an act that one is legally entitled to perform.
Consideration may be defined in many ways, the following definition was obtained from Currie v Misa (1975) LR Exch 153. In this case, Lush J said:
“A valuable consideration in the sense of the law may consist either in some right, interest, profit or benefit accruing to one party, or some forbearance, detriment, loss or responsibility given, suffered or undertaken by the other.” (An introduction to the Law of Contract, 2005)
Consideration may be “executory” which means that the action has not yet been performed. Consideration may be executed which means that the party has already carried out the action which was promised. But consideration cannot be “past”. This means that if a party performs an action voluntarily and after this action is performed, the other party makes a promise, this is said to be “past” consideration.
Consideration must be sufficient. This means that consideration must have a value that can be objectively determined. A promise of love or affection cannot be enforced because of its subjective nature.
Consideration need not be adequate. The court will not decide whether consideration is adequate. This is left to the parties to decide
Two cases illustrate these rules of consideration.
Thomas v Thomas (1842), 2 Q.B. 851, 114 E.R. 330
Facts: M.R John Thomas verbally expressed on his death bed that after he died his wife should be permitted to remain on the premises of the matrimonial house which was in his name. The conditions were as follows; 1) She paid £1 per annum as rent, 2) She kept the premises in good condition and 3) She did not remarry. After M.R. Thomas died, the executors refused to sign the deed and tried to make MRS Thomas vacate the premises.MRS Thomas sued
Held: she succeeded on the grounds that £1 was
Consideration may be defined in many ways, the following definition was obtained from Currie v Misa (1975) LR Exch 153. In this case, Lush J said:
“A valuable consideration in the sense of the law may consist either in some right, interest, profit or benefit accruing to one party, or some forbearance, detriment, loss or responsibility given, suffered or undertaken by the other.” (An introduction to the Law of Contract, 2005)
Consideration may be “executory” which means that the action has not yet been performed. Consideration may be executed which means that the party has already carried out the action which was promised. But consideration cannot be “past”. This means that if a party performs an action voluntarily and after this action is performed, the other party makes a promise, this is said to be “past” consideration.
Consideration must be sufficient. This means that consideration must have a value that can be objectively determined. A promise of love or affection cannot be enforced because of its subjective nature.
Consideration need not be adequate. The court will not decide whether consideration is adequate. This is left to the parties to decide
Two cases illustrate these rules of consideration.
Thomas v Thomas (1842), 2 Q.B. 851, 114 E.R. 330
Facts: M.R John Thomas verbally expressed on his death bed that after he died his wife should be permitted to remain on the premises of the matrimonial house which was in his name. The conditions were as follows; 1) She paid £1 per annum as rent, 2) She kept the premises in good condition and 3) She did not remarry. After M.R. Thomas died, the executors refused to sign the deed and tried to make MRS Thomas vacate the premises.MRS Thomas sued
Held: she succeeded on the grounds that £1 was
References: Ronald I C Bartsch (2004), ‘Aviation Law in Australia, Second Edition’, Thomson Stephen Graw (2005), ‘An introduction to the Law of Contract, Fifth Edition’, Thomson Vermeesch, RB & Lindgren, ‘Business Law of Australia’, Butterworths Turner, Clive, ‘Australian Commercial Law’, Thomson. Farlex, ‘The Free Dictionary’, >http://legaldictionary.thefreedictionary.com/consideration Professor Demeyere, (2003), ‘Contract Law 410 Section E (003)-Thomas v Thomas’ >http://instruct.uwo.ca/law/410-003/thomas.html Patterson and Hocker (1998),‘Chappell v nestle’ > http://law.anu.edu.au/COLIN/Lectures/consid.htm