If you are studying ILSPA's Legal Secretaries Diploma, you will be familiar with offer, acceptance and intention to create legal relations. These elements of contract law usually make sense quite quickly, but consideration can be a little trickier to understand.
For centuries, the English courts struggled to give consideration a clear definition. Then, towards the end of the nineteenth century, the case of Currie v Misa (1875) LR 10 Ex 153 gave Lush J the chance to define it. He said:
"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."
In simple terms, Currie v Misa set out the principle of "benefit gained and detriment suffered", and it remains one of the most important cases in contract law today.
What does this mean in practice? Imagine a window cleaner offers to clean your windows for free. If they then fail to turn up, could you take them to court for breaking their promise?
The answer is no. Currie v Misa confirms that a contract will not exist unless something is given in return for the promise. Because the window cleaner offered their service for free, there is no contract, and the disappointed homeowner has no claim.
Unless a promise is made in a deed, it will not be legally binding without consideration. Consideration does not have to be money. A promise in exchange for another promise is just as enforceable. It also does not have to be of fair value. In Thomas v Thomas (1842) 2 QB 851, a widow's promise to pay £1 a year and keep a house in good repair was enough consideration for the right to live there. The court confirmed that consideration must be sufficient but need not be adequate. This is why a nominal or "peppercorn" payment can still support a binding agreement.
The law has continued to develop since then. In Williams v Roffey Bros & Nicholls (Contractors) Ltd [1991] 1 QB 1, the Court of Appeal accepted that a "practical benefit" could count as consideration, showing how the courts have adapted the principle to modern business.
As you work through consideration, you will find a lot of case law that can take you in several directions. Try not to let it overwhelm you. Take clear notes as you go and support each point with the relevant case. Many Students find promissory estoppel especially tricky, so it is worth studying this section somewhere quiet where you can concentrate.
Once you get past consideration, you can breathe a sigh of relief. It is often the most challenging part of the unit, and the rest should feel much more manageable in comparison, so stick with it.
Want to build your knowledge of contract law? ILSPA offers a standalone course in Contract and Tort, suitable for aspiring and experienced Legal Secretaries and anyone who wants a solid grounding in these core areas of law.