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5,000 . For A consideration = Rs. 5,000 and for B , it is the car. Defn. [Sec. 2(d)]: When at the desire of the promisor (Promissory estoppel), the promisee or any other person has done / abstained from doing (executed) does / abstains from doing ( in the process of being executed) promises to do / abstain from doing anything (executory) such ACT / ABSTINENCE / PROMISE is the consideration. WHY? Law can not enforce gratuitous or voluntary promises. LEGAL RULES AS TO CONSIDERATION 1. It must be at the desire/request of the promisor: Even promises of charitable nature are enforceable, if definite steps have been taken in furtherance of the object on the basis of promise. But first furthering the object and thereafter inviting subscriptions is not enforceable against the promisor of subscription. [Without B’s request, a saves his property from fire. A cannot demand anything from B] 2. It can be from the promisee or any stranger (unlike English Law) – Presence of consideration is material, who has furnished it is immaterial. (XIMB v. AEL) 3. May be an act / abstinence or a return promise 4. May be past, present (cash sale) or future (executory consideration) 5. It need not be adequate – courts do not repair bad bargains. 6. It must be real not illusory - Physical impossibility – Promise to give life to a dead person Legal impossibility – Servant promising to waive debt due to his master Uncertain - a reasonable sum will be paid
) 3. No rights or obligations are cast on the stranger. A written and signed promise to pay time barred debt by the debtor. Exceptions to the rule : contract without consideration is void 1. 4. Should not be illegal. EXCEPTIONS: 1. A person. Assignment of a contract : The assignee of rights and benefits under a contract (Ex. A trust / charge – the beneficiary can enforce 2. Love and Affection : A written and registered agreement based on natural love and affection between near relatives 2. Holder in due course ) 5. Compensation for voluntary services ( A finds B’s money purse. 7.- Illusory – A promise to pay something for some act which is already the contractual duty of the person concerned. Completed gifts : gift already actually made . Covenants running with land: A purchaser who has notice of such things is bound. B promises to pay A Rs. Marriage settlement . Partition or other family arrangements 3. 2. not a party to the contract can not sue even if he is the beneficiary under the contract or he has provided the consideration. 50. Contracts entered into by agent 4. STRANGER TO CONTRACT Parties to contract may sue or be sued – Doctrine of Privity of contract (Mutuality of will) Consequences of doctrine of privity of contract: 1. immoral or opposed to public policy. Agency ( No consideration is needed to create agency ) 5.