Consideration

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Extension_Cord
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Consideration

Postby Extension_Cord » Mon Sep 19, 2011 12:11 am

I have heard conflicting stances on what constitutes consideration. I heard just about anything on minimal value is valid consideration and the value of it means squat. I have also heard if the consideration is too deflated in value then the courts can reject it. Can anyone advise which is correct?

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Champion of the Sun
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Re: Consideration

Postby Champion of the Sun » Mon Sep 19, 2011 12:49 am

Extension_Cord wrote:I have heard conflicting stances on what constitutes consideration. I heard just about anything on minimal value is valid consideration and the value of it means squat. I have also heard if the consideration is too deflated in value then the courts can reject it. Can anyone advise which is correct?


Value is irrelevant as long as it was bargained for. Check the Batsakis case.

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weee
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Re: Consideration

Postby weee » Mon Sep 19, 2011 12:51 am

Whatever your casebook + Professor says it is.

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Champion of the Sun
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Re: Consideration

Postby Champion of the Sun » Mon Sep 19, 2011 12:54 am

Value is irrelevant as long as it was bargained for. Check the Batsakis case.[/quote]
weee wrote:Whatever your casebook + Professor says it is.


That's exactly what my casebook and professor say it is.

agathos
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Re: Consideration

Postby agathos » Mon Sep 19, 2011 5:16 am

read e&e or Chirelstein’s Contracts .. easy understanding .

target
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Re: Consideration

Postby target » Mon Sep 19, 2011 2:09 pm

We are just about to cover consideration, so this is me re-enforcing my understanding of the consideration after 3 cases.

"A valuable consideration, in the senss 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." Hamer v. Sidway, 27 N.E. 256. http://www.lawnix.com/cases/hamer-sidway.html

Yes, money value may mean squat

Champion of the Sun wrote:Value is irrelevant as long as it was bargained for. Check the Batsakis case.


But if money is used to bargain for money, it may not be a consideration. See http://www.lawnix.com/cases/schnell-nell.html

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Redzo
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Re: Consideration

Postby Redzo » Mon Sep 19, 2011 2:19 pm

Generally, courts have a policy of not inquiring as to the adequacy of consideration. It is not the court's business to make sure that every exchange is "fair." As long as it believes that both sides bargained in good faith, the court will not be concerned with evaluating the consideration for a promise.

However, if the court believes that the consideration is a sham, merely nominal, they have the right to invalidate it.

WSJ_Law
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Re: Consideration

Postby WSJ_Law » Mon Sep 19, 2011 2:53 pm

Redzo wrote:Generally, courts have a policy of not inquiring as to the adequacy of consideration. It is not the court's business to make sure that every exchange is "fair." As long as it believes that both sides bargained in good faith, the court will not be concerned with evaluating the consideration for a promise.

However, if the court believes that the consideration is a sham, merely nominal, they have the right to invalidate it.



Right. This idea of consideration for consideration's sake is also referred to as pretextual consideration or "consideration as a pretense". Courts held in Dougherty v. Salt that nothing can be consideration that isn't regarded as such by both parties. So even writing down "This peppercorn is hereby consideration for the promise" wouldn't satisfy the doctrine of consideration...because it isn't actually bargained for or sought--its merely imposed as a superficial device in attempts to validate the K.




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