Consideration is legal value given in return
for a promise or performance.
Must have something of legal value or
Must be a bargained-for exchange.
§1: Elements of Consideration
Consideration for a promise must be either:
Legally detrimental to the promisee, or Legally
beneficial to the promisor.
Case 11.1: Hamer v. Sidway (1891).
§2: Adequacy of Consideration
A Court will not question the fairness of the
bargain if legally sufficient.
Law does not protect a person from entering into
an unwise contract.
In extreme cases, a court may find that a party
lacks legal capacity or that contract was
Case 11.2: Powell v. MVE Holdings (2001).
§3: Agreements That Lack
A promise to do what one already has a legal duty to do
does not constitute legally sufficient consideration.
Recession and New Contract.
Past Consideration is no consideration because the
bargained-for exchange element is missing.
§4: Problem Areas
Settlement of Claims.
Promises enforceable without consideration.
Promisor has not definitely promised to do
anything (no promise at all).
Requirements and Output Contracts.
Settlement of Claims
Debtor offers to pay a lesser amount than the
creditor purports to be owed.
Accord and Satisfaction.
Amount has been ascertained, fixed, agreed on, settled,
or exactly determined.
Parties give up legal right to contest the amount in
dispute, and thus consideration is given.
Settlement of Claims 
Release bars any further recovery beyond the
terms stated in the release.
Case 11.3: Mills v. Berlex Laboratories (1999).
Convenant not to Sue is an agreement to
substitute contractual obligation for some
other type of legal action based on a valid
Promises to Pay Debt Barred by a Statute of
Detrimental Reliance and Promissory
Must be definite promise.
Promisee must justifiably rely on the promise.
Reliance is substantial.
Justice will be served by enforcing promise.