CHAPTER NO.3 (Consideration and object)

BUSINESS LAW
(KHALID MAHMOOD CHEEMA)

CHAPTER NO.3 (Consideration and object)


Q. Consideration & exception of consideration & essentials / Exception?
Consideration: Contract act 1872 section 2 (d),defined considerarion in the following words,"When at the desire of the promiser ,the promisery is done or abstained from doing or does such act is called considerarion for the promisery .
In the other words considerarion is rewards accepted or given in wriiten for the promiser .it is the effect that with out considerarion agreement is not valid.
Justice Patterson: "The considerarion means something which is of some value in the eye of law. it may be some benefit to the plaintiff or some detriment to the defendent.
Lush J: :A valuable considerarion may consist of some rights, interesr, profit, or benefit accuring to one party, and some forbearance , loss or responsibility given ,suffered or undertaken by other.
Pollock: :The considerarion is the price for which the promise of the other is bought and the promise thus given for value is enforceable.
E.g: A promise to repair B's car and B promise to pay Rs 1Lac. The promise of one party is the considerarion for the other party.

Essentials of considerarion
considerarion by the promisery or any other person is the most important factor. it should be given & desire of the promiser.
e.g:Mr Adil agrees to sell his house for Rs 20 Lac to Mr Ashraf ,Mr Ashraf to promises to pay this amount is the considerarion for Mr Adil promise.

Consideration may be Past, Present ,& Future
considerarion IS AN ACT which has already to be done or in progress out to be done in future at the desire of the promiser.
1)Past e.g: Mr Neseem loss his car & MR Faheem is a finder delivered to it him. Mr Faheem can not demand payment of his services due to the paST considerarion.
2)Present e.g: Mr Ali sell a house to Mr Umar . HE pays it price immidiatly it is called present considerarion.
3)Future e.g: Mr Rauf promises to delivered a shop to Mr Anwar after a 1 Month for Rs 20 Lac. ypon the promise of Mr Khan to pay the agree price at the time of delivery , it is called future considerarion.
considerarion must be Oral
considerarion must be ristricted competent .if considerarion is physically illegal & uncertain it will be void.
Needs not to be adequate: The law only insist on the present of considerarion is not on its adequentedit may create the -about the free consent of two party but it is valid if free consent is proved,
Lawful considerarion:considerarion should not be unlawful because it can not performed valid contract ,it should not be against the public policy.
Exceptions
No doubt with out considerarion agreement is void .but it has also exceptions which are followings:
1-Case of an agent: A contract of agency required no considerarion where the contract is a promise to appoint an agent.
2- Case of voluntry services: In a case of compensation for voluntary services there is relaxation of considerarion .
3- Case of affection ( love): considerarion is not compulsary is an agreement is made b/w the parties for nature affection.
4- Case of donation: Agreement made for donationis not enforceable for want of considerarion .A promised amount can not be legally recovered where the promisery has done nothing on the base of promise.
e.g: If Mr Shah promise to denote 1 Lac for the repair of a college .College principal did nothing for repair .Mr Shah refused to pay if a principal of a college cannot sue on Mr Shah because Mr shah cannot be liable for any loss of promise.
5)In case of present /gift:In case of gift there is no need of any considerarion . Any gift which is actuall delivered will be valid, it cannot be demanded back an there is no need of considerarion.
6)Extention in time limit: There is no need of any considerarion , if agreement is ade to extend time for the enforceable of the contract .
7)Case of tie barred debt: If the debtor promises to pay a time barred debt. Then there is no need of considerarion. the promise must be written & signed by the debtor & creditor.

(for more detail/ information see page no. 32 to 37 of the book with example)