Past Consideration (Law)
1.0 Introduction
1.1 Consideration Consideration is also known as element of exchange. To be a contract, the transaction must be supported by consideration. According to general rule, s. 26 of CA state that an agreement made without consideration is void. We can define consideration as the price paid for benefit received or is an exchange of promises. It means that something with monetary value, voluntarily exchanged for an act, benefit, forbearance, interest, promise, right, or goods or services. For example, the promisee has to give something in return for the promise of the promisor in order to convert a bare promise made in his favour into a binding contract. According to Lord Dunedin in Dunlop v Selfridge (1915), consideration is “an act or forbearance of one party, or the promise thereof, is the price for which the promise of the other is bought, and the promise thus given for value is enforceable”. Thus, consideration may be viewed as a sort of bargain, or price which one party pays to buy the promise or act of the other. When the promisor promises to do or to abstain from doing something, the promisee must pay a price for it. There are three types of consideration and one of the considerations is the past consideration.
1.2 Past Consideration Pass consideration is one type of the consideration. If one part voluntarily performs an act before the promise was made or the other party then makes a promise, the consideration for the promise is said to be in the past. For example, A finds and returns B’s digital camera and in gratitude, B promises to reward him with RM 200. B had made a promise here in return for A prior act which is return his digital camera. The return of the camera was an act in the past done independently of B’s promise and will be pass consideration.
2.0 Content
2.1 Past Consideration under Common Law
There are two different views toward this past consideration. Under Common Law of England the general rule, the view of
1.1 Consideration Consideration is also known as element of exchange. To be a contract, the transaction must be supported by consideration. According to general rule, s. 26 of CA state that an agreement made without consideration is void. We can define consideration as the price paid for benefit received or is an exchange of promises. It means that something with monetary value, voluntarily exchanged for an act, benefit, forbearance, interest, promise, right, or goods or services. For example, the promisee has to give something in return for the promise of the promisor in order to convert a bare promise made in his favour into a binding contract. According to Lord Dunedin in Dunlop v Selfridge (1915), consideration is “an act or forbearance of one party, or the promise thereof, is the price for which the promise of the other is bought, and the promise thus given for value is enforceable”. Thus, consideration may be viewed as a sort of bargain, or price which one party pays to buy the promise or act of the other. When the promisor promises to do or to abstain from doing something, the promisee must pay a price for it. There are three types of consideration and one of the considerations is the past consideration.
1.2 Past Consideration Pass consideration is one type of the consideration. If one part voluntarily performs an act before the promise was made or the other party then makes a promise, the consideration for the promise is said to be in the past. For example, A finds and returns B’s digital camera and in gratitude, B promises to reward him with RM 200. B had made a promise here in return for A prior act which is return his digital camera. The return of the camera was an act in the past done independently of B’s promise and will be pass consideration.
2.0 Content
2.1 Past Consideration under Common Law
There are two different views toward this past consideration. Under Common Law of England the general rule, the view of