Understanding Consideration in the Law of Contract

The layman on the streets knows that he doesn’t owe anyone an obligation if there is no payment. He knows that if he promises to¬† do or give something to someone, the only thing binding him to the promise is his honour.

However, when the other person pays him for this promise, he has to fulfil it. In the law of contract, this payment is known as consideration. It doesn’t necessarily have to be a payment, it could even be an act. All that matters is that the person who was promised (promisee) gave or did something in return for the promise.

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