OCR A2 Law - The Law of Contract - Consideration (5)

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  • Created by: Majid
  • Created on: 26-04-13 10:16

Consideration (5)

The basic rule of exception brings certainty to the law, however it has now been blurred/abolished due to the recent case of: "Willaims v Roffey Bros". In this case Williams' duty was to do joinery work for £20K with a deadline which if he didn't meet he'd be fined. He ran out of funding ... Roffey Bros promised an extra £10,300 if work was completed on time... Roffey bros refused to pay but the promise was enforced.

AO2: Goes against the basic rule in "Stilck v Myrick" ... creates uncertainty in the law. However according to judges parties gain a "practical benefit" ... Despite joiner simply doing his basic duty "consideration was found" as stated by Lord Justice Russell. It also shows how judges are moving away from the traditional approach and going against all the basic rules/definitions. The case represents an attack on the doctrine of consideration.

4. Part payment of a debt: 2 Approaches: Common Law/Equity

Common law position: Part payment of a debt in full settlement is NO CONSIDERATION ... creditor can sue for the remaining amounted as stated obiter in "Pinnel's case". However part payment will be good consideration if it is given earlier, different place, or with a horse, hawk, robe.

AO2: Decision is only obiter and pre-judicature ... confirmed as good law by HofL in "Foakes v Beer". In this case Mrs Beer was agreed a payment by Dr. Foakes and it was agreed to be paid instalments however she wanted to sue for interest. It was held she could sue for the remaining money.

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