For a simple contract to be legally enforceable in England and Wales, certain elements must be present. One of the most fundamental of these is the doctrine of consideration. Without consideration, a promise made by one party to another is generally not binding and is considered a gratuitous promise, which the courts will not enforce. The doctrine is essentially the law's way of identifying which promises should be treated as serious and deserving of legal backing. It acts as a badge of enforceability, distinguishing a bargain from a gift. This introduction will define what consideration is, explain what the concept entails by reference to its core principles, and then set out how this essay will analyse the doctrine through an examination of the facts and judicial reasoning in five key cases: Currie v Misa (1875), Thomas v Thomas (1842), Chappell & Co Ltd v Nestlé Co Ltd [1960], Tweddle v Atkinson (1861), and Stilk v Myrick (1809).
The traditional definition of consideration was articulated in the case of Currie v Misa (1875) LR 10 Ex 153, where Lush J stated that, "A valuable consideration, in the sense of the law, may consist either in some right, interest, profit, or benefit accruing to the one party, or some forbearance, detriment, loss, or responsibility, given, suffered, or undertaken by the other." This definition establishes the concept of a bargain through the idea of reciprocity. For a promise to be enforceable, the person seeking to enforce it (the promisee) must show that they have given something of value in return for the promise of the other party (the promisor). This 'something' can be a benefit received by the promisor or a detriment suffered by the promisee. This exchange is what separates a binding contractual promise from a non-binding gift.
The doctrine of consideration entails several key rules which the courts have developed to determine its presence and validity. This essay will explore these rules by examining specific cases. A central principle is that consideration must be sufficient but it need not be adequate. This means that what is offered in exchange for a promise must have some value in the eyes of the law, but the courts will not inquire into whether the parties have made a good or bad bargain. Furthermore, the doctrine establishes that consideration must move from the promisee, meaning the person who wants to enforce the contract must be the one who has provided the consideration. Another important aspect, particularly in the context of modifying existing agreements, is the rule that the performance of a duty already owed under a contract is generally not considered good consideration for a new promise.
To explore these principles in greater detail, this essay will proceed by analysing the facts and judgments of five foundational cases. Firstly, Currie v Misa (1875) will be revisited to firmly establish the legal definition of consideration. Secondly, Thomas v Thomas (1842) will be discussed to illustrate the principle that consideration must be sufficient but need not be adequate. Thirdly, the analysis of Chappell & Co Ltd v Nestlé Co Ltd [1960] will provide a more modern application of this sufficiency principle, demonstrating how even items of seemingly trivial value can constitute valid consideration. Fourthly, Tweddle v Atkinson (1861) will be examined to explain the rule that consideration must move from the promisee, which is a cornerstone of the doctrine of privity of contract. Finally, the case of Stilk v Myrick (1809) will be analysed to understand the rule regarding pre-existing contractual duties and its implications for contract variations. Through the examination of these cases, this essay will provide a clear account of the nature and function of consideration in the English law of contract.
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References
Chappell & Co Ltd v Nestlé Co Ltd [1960] AC 87 (HL)
Currie v Misa (1875) LR 10 Ex 153
Stilk v Myrick (1809) 2 Camp 317, 170 ER 1168
Thomas v Thomas (1842) 2 QB 851, 114 ER 330
Tweddle v Atkinson (1861) 1 B&S 393, 121 ER 762
