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contract law

contract law

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Published by Jacob Black
Consideration
Consideration

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Published by: Jacob Black on Feb 22, 2013
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LAW OF CONTRACT
CONSIDERATION
 
CONSIDERATION
Section 26 of the Contract Act 1950provides that, as a general rule, anagreement without consideration is void
 The word ‘consideration’ is defined insection 2(d) of CA 1950.
In simple, consideration is the price of which one party pays to buy thepromise or act of the other
Literally, it means something that isgiven in return for something else. Forexample, rm3 for a can of beer.
S.2 (e) also stated that every promiseand every set of promises, forming theconsideration for each other, is an
 
Classification of Consideration
1.Executory consideration
It is executory when one promise ismade in return for another promise.
For example, A agrees to sell his houseto B for rm10k. Here, B’s promise topay the sum of rm10k is theconsideration for A’s promise to sell thehouse, and A’s promise to sell thehouse is the consideration for B’spromise to pay rm10k. (
Illustration(a), S.24 CA 1950
)

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