Consideration

Analysis of legal definition of consideration• Consideration is an act, or abstinence• Such act or abstinence must be done at the

desire of the promisor• Such act or abstinence must be done by the

promisor or any other person• Such act or abstinence must be done is either

already executed or is in the process or execution or may still executory

Essentials and legal rules for a valid consideration• The consideration must move at the desire of the promisor• Such act or abstinence must be done from the promisee or

any other person• The consideration may be past, present or future• The consideration need not be adequate• The consideration must be real and not illusory• The consideration must be lawful• The consideration must be something which the promisor is

not bound to do• The consideration may be positive or negative

Exceptions to the rule of privity of contract• Beneficiaries in the case of trust• Marriage settlement, partition and other

family agreement• Acknowledgement of liability• Contracts through agent• Assignee of a contract

“No consideration no contract” exceptions to the rule

• Natural love and affection• Voluntary compensation• Time barred debt• Agency• Completed gift