Deck 9: Consideration

Question 1

The case of Foakes v Beer (1884)9 App Cas 605 is authority for the principle that payment of a lesser amount than that already owed:

A)discharges the debt if accepted by the payee.
B)is an act detrimental to the payer and therefore good consideration.
C)is not sufficient consideration for the payee's promise to discharge the debt.
D)can be revoked at any time by the payer.

Answer 1

C

Question 2

The effect of the rules of consideration is that the law can only be used to enforce bargains,but it cannot be used to enforce promised gifts.Is this distinction between gifts and bargains a fair one?

Answer 2

answers will vary

Question 3

Which case is authority for the principle that a promise made after an act is not supported by consideration?

A)Lampleigh v Braithwait (1615)Hob 105;80 ER 255.
B)Anderson v Glass [1869] 5 WW&A'B(L)152.
C)Dunlop Pneumatic Tyre Co Ltd v Selfridge & Co Ltd [1915] AC 847.
D)Roscorla v Thomas [1842] 3 QB 234.

Answer 3

D

Question 4

In order to form a simple contract,a bargain must be present.

Question 5

Which of the following is the best example of past consideration?

A)A pays B $10.00 today in return for B giving A a book today.
B)A promises to pay B $10.00 tomorrow in return for B giving A a book tomorrow.
C)A promises to pay B $10.00 tomorrow in return for B giving A a book yesterday.
D)All of the above.

Question 6

In which case did the court decide that performance of an existing contractual duty by a group of sailors was not good consideration for the captain's promise to pay extra wages?

A)Glasbrook Bros Ltd v Glamorgan County Council [1925] AC 270.
B)Stilk v Myrick [1809] 2 Camp 317.
C)Roscorla v Thomas [1842] 3 QB 234.
D)Hartley v Ponsonby (1871)119 ER 1471.

Question 7

In the context of contract law,'consideration' is defined as:

A)the act of considering the terms of a contract before agreeing to them.
B)the monetary value of the contract.
C)a sum paid by one party for the other party's offer.
D)the price paid by each party for the other party's promise or performance.

Question 8

Valid consideration is NOT established by which of the following?

A)The consideration must be definite.
B)The consideration must be gratuitous.
C)The consideration must be possible.
D)The consideration must be present or future but not past.

Question 9

The claim for higher wages was successful in Hartley v Ponsonby (1871)119 ER 1471 because:

A)there was a commercial benefit to the defendant.
B)performance went beyond what was originally promised.
C)the promisor derived an additional benefit.
D)completion as originally promised saved the defendant additional cost.

Question 10

Which of the following is the best example of executory consideration?

A)A pays B $10.00 today in return for B giving A a book today.
B)A promises to pay B $10.00 tomorrow in return for B giving A a book tomorrow.
C)A promises to pay B $10.00 tomorrow in return for B giving A a book yesterday.
D)All of the above.

Question 11

To establish consideration,the price must be:

A)valuable,adequate and sufficient.
B)valuable and either adequate or sufficient.
C)valuable and adequate,but need not be sufficient.
D)valuable and sufficient,but need not be adequate.

Question 12

The rule in Foakes v Beer will apply in which of the following scenarios?

A)Where the creditor has requested that the debtor pay the lesser amount by cheque instead of cash.
B)Where the creditor has requested that the debtor pay the lesser amount at a different place.
C)Where the creditor has requested that the debtor accompany payment of the lesser amount with some other act they were not originally bound to perform.
D)Where the creditor has requested that the debtor pay the lesser amount on an earlier date.

Question 13

The rule in Foakes v Beer was not applied in Hirachand Punamchand v Temple [1911] 2 KB 330 because:

A)the payment was accepted by the creditor.
B)the debt was paid by a third party.
C)the debt was paid with interest.
D)the debt was paid in full.

Question 14

In which case did the court decide that,while performance of an existing legal duty by police officers was not good consideration for a mine owner's promise to pay,performance beyond what they were legally required to do was good consideration?

A)Anderson v Glass [1869] 5 WW&AB(L)152.
B)Glasbrook Bros Ltd v Glamorgan County Council [1925] AC 270.
C)Stilk v Myrick [1809] 2 Camp 317.
D)Hartley v Ponsonby (1871)119 ER 1471.

Question 15

The person making the promise is considered the promisee.

Question 16

Which of the following is the best example of executed consideration?

A)A pays B $10.00 today in return for B giving A a book today.
B)A promises to pay B $10.00 tomorrow in return for B giving A a book tomorrow.
C)A promises to pay B $10.00 tomorrow in return for B giving A a book yesterday.
D)All of the above.

Question 17

Which of the following is NOT one of the criteria which must be satisfied in order for 'past' consideration to be enforceable?

A)At the time the past consideration was provided,the parties understood that it would be remunerated.
B)The past consideration was identified after the promisor made their promise.
C)The promise would have been enforceable if it had been promised in advance of the past consideration.
D)The past consideration was provided at the promisor's request.

Question 18

The consideration paid by a party to a contract can be:

A)forbearance.
B)a promise.
C)an act.
D)any of the above.

Question 19

Which of the following is NOT one of the reasons for the decision in Lampleigh v Braithwait (1615)Hob 105;80 ER 255?

A)The request and promise to pay were treated as a normal business transaction.
B)There was an implied promise to pay at the time of the request.
C)The request and the promise to pay were treated as part of the same transaction.
D)The services were performed at Braithwait's request.

Question 20

In which case was the issue of past consideration considered in the context of an employment contract?

A)Roscorla v Thomas [1842] 3 QB 234.
B)Dunlop Pneumatic Tyre Co Ltd v Selfridge & Co Ltd [1915] AC 847.
C)Lampleigh v Braithwait (1615)Hob 105;80 ER 255.
D)Anderson v Glass [1869] 5 WW&A'B(L)152.

Question 21

Estoppel can only be used as a defence.

Question 22

Is it possible for past consideration to be good consideration?

Question 23

All simple contracts require consideration to be present.

Question 24

A promise to accept a lesser sum in satisfaction of a greater sum will be enforceable if it is contained in a deed.

Question 25

Consideration must be present or future,it cannot be past.

Question 26

Executed consideration is also referred to as future consideration.

Question 27

Estoppel is based on an assumption of fact or law.

Question 28

Only a promise supported by consideration will be enforced by a court.

Question 29

A moral consideration cannot amount to good consideration.

Question 30

In which of the following cases was the plaintiff successful on the basis of promissory estoppel?

A)East Van Villages v Minister Administrating the National Parks and Wildlife [2001] NSWSC 559.
B)Giumelli v Giumelli (1999)196 CLR 101.
C)Austotel Pty Ltd v Franklins Selfservice Pty Ltd (1989)16 NSWLR 582.
D)None of the above.

Question 31

Estoppel was rejected Easts Van Villages v Minister Administering the National Parks and Wildlife [2001] NSWSC 559 because:

A)The plaintiff had not suffered any detriment.
B)The defendant's statement was not unambiguous.
C)Estoppel was not rejected.
D)The parties had equal bargaining power.

Question 32

The plaintiff in Dunlop Pneumatic Tyre Co Ltd v Selfridge & Co Ltd [1915] AC 847 was unable to enforce the defendant's promise because:

A)the promise had been made to Dew & Co.
B)there was no privity of contract between Dunlop and Selfridge.
C)Dunlop had given Selfridge no consideration.
D)all of the above.

Question 33

Why is consideration important in respect to contracts? In your answer compare the types of consideration supported by relevant cases.

Question 34

Explain what is meant by the expression 'valuable consideration.'

Question 35

Which of the following is NOT an element of promissory estoppel?

A)The defendant is responsible for creating the assumption.
B)An assumption in the mind of the plaintiff.
C)The defendant's statements were vague and ambiguous.
D)The plaintiff relied upon the assumption to his detriment.

Question 36

When the doctrine of promissory estoppel is applied,it results in the suspension of the promisor's legal rights.

Question 37

Which of the following would NOT amount to sufficient consideration?

A)A promise to give the creditor a book worth $100 in exchange for a full discharge from a debt of $200.
B)A used postage stamp.
C)A promise to give $100 to one party's daughter in exchange for a promise to provide services to the value of $300 to the other party.
D)A promise to pay $100 in exchange for a promise to fully discharge the debtor from the obligation to pay the balance of the debt of $200 owing to the creditor.

Question 38

Consideration must have a value that is recognised by the law.

Question 39

The doctrine of promissory estoppel:

A)can be used to commence a civil action but not as a defence to a civil action.
B)can be used to either commence or defend a civil action.
C)can be used as a defence to a civil action,but not to commence a civil action.
D)all of the above.

Question 40

The decision in Waltons Stores (Interstate)Ltd v Maher (1998)164 CLR 387 is significant because:

A)promissory estoppel was applied where there was no pre-existing contract.
B)promissory estoppel was used to commence an action.
C)promissory estoppel was applied in Australia.
D)all of the above.