2019 Zone B

Question no 2

(a) ‘Past consideration is never good consideration.’

Discuss.

(b) The roof of Amelia’s house was damaged in a winter storm. She contracted with Bertie who
told her it was about a week’s work and would cost £10,000. Amelia accepted Bertie’s price and
they further agreed that the work would be completed before 1 May so that Amelia could host
a 21st birthday party at her house on 3 May for her daughter Camilla. Bertie began the work on
1 April but bad weather caused many delays. As a result Bertie said he would only be able to
complete the job by 1 May if he employed extra workmen and this would increase his costs.
Amelia offered to pay him £12,000 if he completed the job on time. Bertie went on to complete
the repairs before 1 May and Amelia paid him £10,000 but refuses to pay any more.

Advise Bertie

ANSWERS

a) The question provided is about consideration which more specifically requires discussion
on the area ‘Past Consideration is not a good consideration’. In this answer it will be
discussed accordingly supported with relevant case laws.

Consideration has been defined in the case Currie v Misa as a valuable consideration in the
eyes of law may consist either in some rights interest profit or benefit accruing to one party
and loss detriment, forbearance or responsibility given suffered or undertaken by the other.
One of the rules for a promise to be a good consideration is that it should not be past or the
act cannot be done prior to the promise made, Re McArdle.

In Roscorla v Thomas the promisor promised that the horse sold to P was free from vice.
After delivery it was found that the horse was not free from vice. The promise was not
supported by a fresh consideration as it was made after it was sold. So a past consideration
cannot be a good consideration as the horse was sold before the promise was made.

In Eastwood v Kenyon John died and left Eastwood as the guardian to his infant daughter,
Sarah. Eastwood borrowed money for Sarah’s education. On her marriage her husband
Kenyon, promised Eastwood to pay his loan. He failed and it was held that there was no
liability for past consideration. This was later improved in Re McArdle.

However there are exceptions to the rule, the circumstances in which a promise made after
the acts constituting the consideration will be enforceable were considered in Pao on v lau
yiu long. Lord Scarman laid three conditions to be satisfied to make the exception to be
applied. First the act is done at the promisor’s request Lampleigh v Braithwait, there was an
implied promise. In this case Braithwaite killed someone and requested lampleigh for not
paying 100 pounds as he promised. So the act was done at the promisor’s request and
cannot be a past consideration. The request made it an executed consideration.

Second condition is where the parties assumed that the work being done would be paid in
any way, money or other benefit. In Re Casey’s Patents it was similar to the earlier case. It
was stated by the party that the promise was made in respect of the plaintiff’s past services
and therefore the plaintiff cannot enforce the promise against them because he provided no
consideration for it. There was also an implied promise.

Last condition is that the promise would have been legally enforceable if it was made prior to
the act.

If all these three conditions are successfully applicable, then the rule of past consideration is
not a good consideration will be exempted.

b) The given scenario is about the performance of existing obligation under consideration.
Here, Amelia’s house was damaged in a winter storm and she contracted with Bertie, the
contractor to fix the damaged roof.

Amelia and bertie clearly entered into an enforceable contract as the contract was made to
renovate her roof for 10000 pounds. Along with that Amelia expressly mentions that the roof
work should be completed before 1st May so that she could celebrate her daughter’s birthday
party on 3rd May. To this, she attached great significance which could be referred to as an
express term, Bannerman v White.

Now it is to be determined whether Bertie can claim the additional 2000pounds. Generally ot
is to be considered that performance of an existing obligation of a contractual duty cannot
suffice as being a good consideration as per Stilk v Myrick. However, this rule has
exceptions. The case Hartley v Ponsonby provided that if the obligated party goes beyond
or exceeds his contractual duty, then he may claim the extra payment. In the facts, Bertie
was either way supposed to finish work before 1st may. The promise to pay extra amount
was supported with no consideration.

According to Williams v Roffey Bros , Bertie may try to make Amelia’s promise to pay extra
enforceable. To do so, 5 requirements must be established. First, there was a contract for
the supply of goods or services. In this case, bertie was providing a service to Amelia by
fixing the damaged roof. Secondly, Bertie was unable to perform as promised (but not due to
economic reasons). A poor weather condition is not sufficient to frustrate the contract, Davis
v Fareham. Third, Amelia agreed to pay more, an extra 2000 pounds. Fourth, Amelia
obtained a practical benefit from that promise. That benefit is that she could host her
daughter’s 21st birthday party. If the house wasn’t ready by 1st may Amelia would have to hire
another place which would cost money. Similarly, in Williams v Roffey bros, if the flats
construction wasn’t done in time, they would have to pay a penalty. In both cases, payment
of money was avoided which gave them a practical benefit. The case MWB v Rock, also
concerns the rule practical benefit.

Consideration need not be adequate but sufficient Chappel v Nestle.

Lastly, there was no fraud or duress by Bertie to obtain that promise. Bertie may be able to
enforce the promise to pay the extra 2000 pounds on Amelia.