CHAPTER V. CONSIDERATION. 62. Definition of consideration. The law requires that every simple contract be based upon what it considers a valuable consideration. Consideration is that which moves from the promisee to the promisor, at the latter's request, in return for his promise.87 Anson defines consideration to be "something done, forborne or suffered, or promised to be done, forborne or suffered, by the promisee in respect of the promise. It is said that where there is a benefit to the promisor, and a detriment to the promisee, there is a consideration. 1988 The modern conception of the principles of consideration declares that the real test of a sufficient consideration is whether or not there is a detriment to the promisee, and that the presence of a benefit to the promisor is unnecessary. Thus, in Devecmon v. Shaw,89 the plaintiff went on a pleasure trip to Europe when his uncle told him that he would pay his expenses. Later, the uncle refused to pay. The 87 In any action on a contract the promisor is the party who makes the promise. He is the party sued, and is called the defendant. The promisee is the party who sues, and he is called the plaintiff. Were the defendant in the first action to sue the plaintiff of the first action, in a counter suit on the contract, then the party who was originally the promisor (defendant) will become the promisee and the plaintiff in the counter action. The party who was the promisee (plaintiff) in the original action would become the promisor (defendant) in the counter action. 88 Anson, Contracts (Huffcut's 2d ed.), § 118. 89 69 Md. 199, 90 nephew was allowed to recover in an action for breach of contract on the ground that he did something he was not going to do, nor was bound to do; namely, to go to Europe. The court held that was a consideration. "It was a burden incurred at the request of the other party." In another case, Hamer v. Sidway,"0 the uncle promised to give his nephew $5,000 on his twenty-first birthday, if he did not drink liquor, use tobacco, swear or gamble before he was twentyone years of age. The nephew fulfilled the terms of the offer. In an action for breach of contract, this forbearance was held to be a consideration, for the nephew gave up what he had a right to do. In neither of the two cases cited was the uncle benefited, but in both did the plaintiff do or give up something he was not bound to do or give up. 91 Thus, even the giving of an oath would be sufficient to support a promise to pay a sum of money.92 To do something one is not bound to do, as to give a promise, to do an act, or to pay money, constitutes a sufficient consideration. A legal detriment, and not a benefit, is the necessary element of a consideration.93 An agreement, not under seal, and without a consideration, is known as a nudum pactum (naked agreement), and is unenforcible; for example, A's promise to support B during his lifetime without any promise by B. 63. Consideration distinguished from motive.— Parties have personal reasons for entering into con 90 124 N. Y. 538, LEADING ILLUSTRATIVE CASES. 91 Cook v. Bradley, 7 Conn. 57, LEADING ILLUSTRATIVE CASES. 92 Brooks v. Ball, 18 Johns. 337 (N. Y.). 93 White v. Bluett, 23 L. J., Ex. 36 (Eng.). tracts. These reasons form the basis of the motive for the agreement. But the motive is by no means the consideration. The latter is an element determining the enforcibility of the contract, and is the thing given or done by the party in reliance of the promise. The former is the cause back of the transaction. The distinction between motive and consideration is readily illustrated. A, to provide for his wife's welfare after his death, requested C, who was to be his executor, to rent to the wife a certain house, for which A agreed to pay £1 per year. Later, C refused to perform. The plaintiff was permitted to recover, for the court held that while the motive was to carry out the wishes of the deceased husband, it was the £1 a year which A promised to pay that supported the promise." This was the consideration. 64. Valuable consideration.-A valuable consideration consists of the detriment which has been indicated. It is "such as money, marriage, or the like, which the law esteems an equivalent given for the grant."95 It need not be money nor a thing of pecuniary value. Thus, a promise by C to pay his divorced wife, D, an annuity if she will conduct herself in a virtuous manner, is a detriment to D. This constitutes a consideration, for D is under no obligation to her husband to remain virtuous.96 On the other hand, a promise (not under seal) to make a gift lacks a valuable consideration and is unenforcible.97 94 Thomas v. Thomas, 2 Q. B. 851 (Eng.). 95 2 Blackstone, Commentaries, p. 297. 96 Dunton v. Dunton, 18 Vict. L. Rep. 114 (Victoria). 97 Williams v. Forbes, 114 Ill. 167, 28 N. E. 463. A A full and valuable consideration is one which is a just equivalent for what is given or promised. Where pays B the full value of a horse is an example. A valuable consideration is sufficient in law, and as between the parties can only be attacked for such gross inequity as amounts to fraud, or constitutes a fraud as against the creditors of the contracting parties. If the consideration is full and valuable, it cannot be attacked in equity by antecedent creditors, unless the contract was made with knowledge of their claims and is void for want of good faith. 65. Valuable consideration need not be adequate. -If a consideration is valuable it need not be adequate. The court does not require that the consideration and the thing to be done shall be in exact proportion as to values. A party is permitted to drive a good bargain, so long as he does it without deceit or fraud. But, however small it be, the consideration must have some real value. Thus, A may agree to sell B his horse, worth $200, for $50, and the bargain will stand. If, however, the owner was induced to make the promise on account of false representations or undue influence, the inadequacy of the price would be evidence of fraud. But note that mere inadequacy of consideration does not of itself constitute fraud. Moreover, courts hesitate to disturb contracts for such inadequacy unless the agreement is highly unconscionable. 66. Executory and executed considerations.—An executory consideration refers to a future act; thus, a promise for a promise constitutes a contract upon executory considerations. Either may perform, or offer to perform, and thus bind the other to fulfill or compensate for the breach. An executed consideration arises where one of two parties has, either in the act which amounts to a proposal or the act which amounts to an acceptance, done all that he is bound to do under the contract, leaving an outstanding liability on the other party only.98 If a thing is done at the time a promise is given the consideration is executed; if there is only a promise to do it in return for another promise, the consideration on both sides is executory.99 A contract with an executed consideration is unilateral; if there are two promises, each being the consideration for the other, the contract is bilateral.1 3 67. Good consideration.-A good consideration is founded on "motives of generosity, prudence and natural duty."2 It is the consideration of blood relationship and resembles such a consideration as would be founded on moral laws. It was once held that a person might make a binding promise to another to do something for the other's son or daughter, and that the promise would be enforcible because of the relationship. Generally, this rule has been abolished. Blood or natural affection is no longer considered such a consideration as will support a prom 98 The student should take notice that the terms, "executed and executory," are not used in the same sense by all legal writers; thus Walker uses "executed" in the sense of "past" (American Law, p. 439), as do a number of other writers. Bishop, Contracts, § 440; 1 Parsons, Contracts, p. 468. 99 Anson, Contracts (Huffcut's 2d ed.), § 124. 1 Farrington v. Tenn., 95 U. S. 679, 683. 2 Blackstone, Commentaries, p. 297. 3 Anson, Contracts (Eng. ed.), p. 78. |