A Consideration Legal Definition
There are conditions that must be taken into account in order to have sufficient legal value. A party cannot promise to do something where there is already a legal obligation to do so. A police officer cannot receive a reward for arresting and arresting an outlaw. The promisor must take a step that he is not normally obliged to take. A police officer cannot use independent security services for his neighbourhood while on duty at his or her usual place of work. He already has the obligation to secure the neighborhood. To enter into a valid contract, the counterparty must meet the following conditions: For the consideration to be of legally sufficient value, a party may ultimately refrain from exercising a right to which it is entitled, such as the right to waive the right to sue someone for a refund. For example, let`s say Jamal dented John`s wings while repairing the car. Jamal apologizes and tells John that he will fix the bump for free and also give him a 10% discount on the original repair.
If John agrees to the deal, he can`t sue Jamal later for damaging the car. An exchange must be legally sufficient and negotiated between the parties for a contract to be considered a valid consideration. If there is no consideration in a contract, the contract becomes invalid and the courts may refuse to perform the contract. Sometimes a contract lacks consideration, although at first glance it seems that the parties are exchanging something of value. To this end, we focus on reviewing or exchanging promises negotiated between two or more parties. In the past, courts have ruled that nominal consideration is appropriate, with benefits trading only a penny. Over time, however, this type of thinking went through the window, and the consideration required more value. In general, consideration in the past is not a valid consideration and has no legal value. Previous considerations are considerations that have already flowed from promising to promising.
That is, the act or tolerance of the promise is older than the promise of the promise. The consideration in the past cannot therefore be used as a basis for claiming damages.  An exception to this rule is when an obligation is owed to a third party. A step taken before making a promise of payment or granting another benefit can sometimes be a consideration for the promise. For this to apply, three conditions must be met (Pao On v Lau Yiu Long ): Consideration is one of the six elements that make up a legally enforceable contract. It is something of value given in exchange for something else of value. A common example of consideration is money given in exchange for goods or services. In other words, balancing is what you get out of a contract. To be valid, the audit must include the following: Labriola, who was deprived of his rights by Pollard`s shares, sought a declaratory judgment against Pollard to cancel the new agreement. This type of judgment is used when a legal dispute has arisen, but before the damage has occurred. He also claimed that Pollard had convoluted himself to interfere in the employee`s affairs.
Unfortunately, the court of first instance ruled against Labriola. Consideration is something of value that is exchanged between the contracting parties. It can be money, job performance, goods or other goods. Both contracting parties must receive consideration for a contract to be valid. In general, a conditional consideration is a valid consideration. Consideration in contracts refers to the benefit that each party receives in exchange for what it waives in the contract. This is an essential element that must be included in a contract in order to make it legally binding on the parties. A contract, whether verbal or written, becomes invalid if there is no consideration. The legal consideration in your contract includes something that is useful to both parties and is being negotiated. One party cannot “win” the other party in the contract; Both parties must see a similar advantage in signing the contract. This does not mean that the consideration has a monetary value; Instead, it`s just something of value to the parties involved, such as a service, personal property, or real estate. Certain elements must be completed in order for the consideration to be considered to have sufficient legal value.
Without this legal sufficiency, the consideration as well as the entire contract will be considered null and void. It is not enough to add the word “consideration” to your contract to make it enforceable. For example, many contracts usually have a recital at the beginning, which states that the contract is “for a good and valuable consideration.” Unless there is clear evidence of this consideration in the contract, this statement is unnecessary.