WALEED BILAL 18U00269 SECTION D GROUP 2 CONSIDERATION ASSIGNMENT (10 MARKS) 1. What is consideration? Give one example. 2. If I decided to sell my entire guitar collection for Rs. 10, will this be valid consideration? If yes, which principle applies? 3. I enter into a contract with an architect to build my farm house. We agree on a fee of Rs. 5 lacs for the entire project. Impressed by a friends farmhouse, I contact my architect 4 months into construction and offer to pay him another Rs. 2 lacs for making me a ‘nice house’. At the end of the project I pay the architect a total of Rs. 5 lacs. He takes me to court. Will he be able to claim the additional 2 lacs? Give a reason for your answer. 4. I enter into a contract with X for the sale of my house, in parts, @ Rs. 2.5 lacs a month. Due to financial problems in X’s family I agree to decrease the monthly payments to Rs. 1.5 lacs/month for the period that the financial problems phase out. Will the courts recognize such an agreement? Give reasons for your answer. ANSWERS: 1- Consideration refers to something of value given to someone in return for goods, services, or some other promise. In gift consideration is missing from one side. Consideration has to be given at the desire of the promisor. Consideration may move from any person. Example: X buys a house from Y for Rs 1 crore, x’s consideration for Y’s promise is the money and Y’s consideration for X’s promise is the house. 2- If I have decided to sell my entire guitar collection for Rs.10, this is a valid consideration. Principle that is applied on it is, It must be sufficient not adequate. By that we mean that there must be something that both parties are offering. If you are giving your guitar collection, that what be your consideration and buyer who is giving Rs.10 in return is his considerations. 3- Architect won’t be able to claim his additional 2 lakhs because a consideration must be something other than the existing obligation. It is Architect existing obligation to build her a nice house. 4- Yes, it will be recognised by the court because new considerations were enforced by seller of the house. Exceptional promissory estoppel will apply as new promise modification. However it will be only till x’s financial conditions are solved.
