Jason is right that consideration itself does not function as a formality (at least in a typical agreement). But the consideration rule may nonetheless still be best explained on ‘formal’ grounds. The basic effect of the rule is that someone who wants to make a binding gratuitous promise must either make the promise as a deed or recast it as an exchange for nominal consideration. Given that gratuitous promises, and in particular donative promises, raise potential questions about whether the promise truly intended to be bound, acted seriously, etc., (for all the reasons Fuller outlines in ‘Consideration and Form’), it is perfectly understandable that the courts might want to require a formality for such promises—which is exactly the effect of the consideration rule.. This explanation fits well with Roffey because where a gratuitous promise is made in the context of an ongoing contractual relationship the concerns about intent to be bound, etc., that such promises normally raise arguably do not arise. This is not to saythat all applications of the consideration rule can be explained on this ground. There are no doubt some gratuitous promises (aside from variations) that, like variations, do not raise intent issues but to which the rule still applies. The consideration rule was not introduced into the law as a formality, and no lawmaker starting from scratch would re-introduce it for this purpose. It is much simpler to legislate that gratuitous promises, or at least donative promises, must be in a deed, or whatever (which is precisely what civilian systems do wrt donative promises). Nonetheless, the formal explanation of consideration may be the best explanation possible of an imperfect doctrine.

 

Benson’s Hegelian justification for consideration (which has also been developed at length by Alan Brudner in an article and in his book) is noteworthy in that it is the only explanation for consideration that I am aware of that makes consideration an absolutely central and necessary part of contract law.  But as Ken notes, this feature is also its most obvious drawback: if the doctrine is so fundamental, how is it that civil law manages without it (and why does the common law enforce gratuitous promises under seal)? The other problem with the Hegelian explanation is that it is, with respect, incomprehensible. By this I do not mean that Benson and Brudner’s accounts are poorly written; to the contrary, they are (like all of their work), elegant and deeply sophisticated accounts. What I mean is that it is impossible (for me anyway) to explain their accounts without basically just reproducing the entire hegelian structure, terminology, etc. I have tried many times both when teaching and in my writing to describe the theory in a way that an intelligent judge or lawyer would understand and never succeeded. I can, of course, simply reproduce the Hegelian structure to show how hegel arrives at consideration (though this takes a long time), but at the end readers and students invariably find themselves confused; they want the Hegelian ideas explained using language and concepts that relate to their experience and which they can then understand. I have never been able to do this and have never read anyone who can do it. Die-hard Hegelians (and Kantians) might not take this methodological point as a genuine criticism, but for me it counts against any account of the law if that account cannot be understood by a reasonably intelligent judge, etc.

 

Cheers

 

Steve

 

 

Dear David & all:
 
I would argue that consideration is not a formal requirement like the seal or notarization at all but rather a
conceptually necessary part of contract that helps to explain why contract law is not a system for the enforcement
of conventional morality (which would be problematic in a liberal democracy) and is reflective of the harm
principle that is embodied in the rest of the common law. The most sophisticated argument of this type can
be found in the work of Peter Benson (see The Unity of Contract Law).
 
The doctrine of consideration is not primarily about showing an intention to have legal relations either since
everyday we enter into situations where there is consideration but there is no contract
(I'll walk the dog if you do the dishes).  Alan Brudner and Robert Stevens both have excellent discussions
 which make this point as well (see Rob's inaugural and “Reconstructing Contracts” (1993) 43 U.T.L.J. 1).
  
    

----- Original Message -----
From: David McLauchlan <David.McLauchlan@vuw.ac.nz>
Date: Monday, November 24, 2008 11:24 pm
Subject: RE: ODG: Roffey Bros
To: Angela Swan <aswan@airdberlis.com>, michael furmston <michaelfurmston@hotmail.com>, jneyers@uwo.ca, wingfield@weirfoulds.com
Cc: a.m.tettenborn@exeter.ac.uk, obligations@uwo.ca

> Well, I meant it is all good "teaching" fun, but serving the
> serious purpose, inter alia, of being an excellent mechanism for
> getting students to see that the requirement of consideration
> has become fundamentally flawed and that nowadays, in the words
> of Russell LJ, the courts are "more ready to find its existence
> so as to reflect the intention of the parties to the contract
> where the bargaining powers are not unequal and where the
> finding of consideration reflects the true intention of the
> parties".  The challenge of finding a better basis for
> determining what promises to enforce and what ones not to has of
> course been faced by scholars on countless occasions for more
> than a century and will undoubtedly continue to be faced for
> another century, but the chances of a high appellate court
> discarding the requirement of consideration are about as high as
> Osama Bin Laden converting to Christianity!
>  
> David
> 
> ________________________________
> 
> From: Angela Swan [mailto:aswan@airdberlis.com]
> Sent: Tue 25/11/2008 2:48 PM
> To: David McLauchlan; michael furmston; jneyers@uwo.ca;
> wingfield@weirfoulds.comCc: a.m.tettenborn@exeter.ac.uk;
> obligations@uwo.caSubject: RE: ODG: Roffey Bros
> 
> 
> 
> David, it's not "all good fun"; it's far too important for that.
> 
> The simple argument that because the promise given for
> consideration is enforceable, the promise not given for
> consideration is unenforceable is false. When faced with an
> argument over the enforcement of what Karl Llewellyn called a
> "going-transaction adjustment" the choice between enforcement
> and a refusal to enforce is not symmetrical; it's far more
> serious not to enforce than it is to enforce when enforcement
> will protect the parties' reasonable expectations-the
> expectations they shared when the modification was made.  
> Of course, there may be circumstances, explored for instance in
> Pao On, where there are substantive reasons not to enforce a
> promise, but the mere absence of technical consideration is not
> a good reason.
> 
> Michael's account of his conversation with Glidewell illustrates
> the judicial recognition of the asymmetrical choice I refer to.
> 
> The challenge of scholars is to find a better basis for
> determining what promises to enforce and what ones not to. It is
> clear that the kind of sterile arguments made over the presence
> or absence of consideration is unhelpful.
> 
> Angela Swan
> 
> 
> 
> -----Original Message-----
> From: David McLauchlan [mailto:David.McLauchlan@vuw.ac.nz
> <mailto:David.McLauchlan@vuw.ac.nz> ]
> Sent: Monday, November 24, 2008 7:59 PM
> To: michael furmston; jneyers@uwo.ca; wingfield@weirfoulds.com
> Cc: a.m.tettenborn@exeter.ac.uk; obligations@uwo.ca
> Subject: RE: ODG: Roffey Bros
> 
> Ah, Michael, wish I had been at that lunch!  I could have
> asked how he found support for his "principle" in Williams v
> Williams, Ward v Byham and Pao On, and why he cited the wholly
> irrelevant passages from the latter dealing with public policy,
> "cunningly" leaving out the bit in which the Privy Council
> explicitly endorsed Stilk v Myrick as based on want of consideration!
> 
> 
> As to the position in NZ, the law is in a right mess.  In
> Antons Trawling [2003] 2 NZLR 23 the CA went so far as to say
> that a contractual variation that is "acted on" is binding
> without consideration in the absence of duress or "policy" (!!)
> reasons for setting it aside.  More recently, however, in
> Fuel Expresso [2007] 2 NZLR 651 a differently constituted CA,
> without referring to Antons,  thought it axiomatic that
> consideration was required.  As Michael says, all good
> fun.  And wonderful stuff for teaching students not to take
> what judges say too seriously.
> 
> Kind regards
> 
> David
> 
> 
> ________________________________
> 
> From: michael furmston [mailto:michaelfurmston@hotmail.com
> <mailto:michaelfurmston@hotmail.com> ]
> Sent: Mon 24/11/2008 9:23 PM
> To: jneyers@uwo.ca; wingfield@weirfoulds.com
> Cc: a.m.tettenborn@exeter.ac.uk; obligations@uwo.ca
> Subject: RE: ODG: Roffey Bros
> 
> 
> The discussion of Williams v Roffey reminds me that soon after
> the decision I was sitting next to Iain Glidewell at lunch at
> Gray's inn and we talked about the case.It was clear that he had
> not encountered consideration since he left law school and had a
> strong intuitive perception that the deal should be upheld.
> 
> It would have been easily possible to massage the facts so as to
> satify the consideration testwhich would  have made the
> case much less fun.
> 
> The Roman law of contract will still be discussed after Hegel is
> forgotten All best wishes Michael
> 
> > Date: Fri, 21 Nov 2008 15:28:29 -0500
> > From: jneyers@uwo.ca
> > Subject: Re: ODG: Roffey Bros
> > To: WINGFIELD@WEIRFOULDS.COM
> > CC: A.M.Tettenborn@exeter.ac.uk; obligations@uwo.ca
> > 
> > I take the Seavey, Cardozo and Australian line in regard to
> estoppel
> > so that the doctrine is not about enforcing promises per se
> but about
> > remedying justified detrimental reliance (like Hedley Byrne).
> On this
> > view, accepting estoppel does not conflict with the
> requirement that
> > to make a promise binding fully qua promise you need
> consideration.
> > 
> > Cheers,
> > 
> > Jason Neyers
> > Associate Professor of Law & 
> > Cassels Brock LLP Faculty Fellow in Contract Law Faculty of
> Law
> > University of Western Ontario N6A 3K7
> > (519) 661-2111 x. 88435
> > 
> > 
> > 
> > David Wingfield wrote:
> > > 
> > > What happened to promissory estoppel?
> > > 
> > > ----- Original Message -----
> > > From: Jason Neyers <jneyers@uwo.ca> 
> > > To: Andrew Tettenborn <A.M.Tettenborn@exeter.ac.uk> 
> > > Cc: obligations@uwo.ca <obligations@uwo.ca> 
> > > Sent: Fri Nov 21 13:01:17 2008
> > > Subject: Re: ODG: Roffey Bros
> > > 
> > > Dear Andrew:
> > > 
> > > I would say as a matter of logic consideration must be
> necessary for
> > > any modification of a contractual obligation except perhaps
> for
> > > unilateral abandonment (if such a thing is possible in
> contract
> > > law). Why should the promise of the extra money be binding
> in
> > > /Roffey/? The promisor only has an obligation to pay X not X
> plus Y.
> > > If consideration isn't needed for Y, then why is it needed
> for X in
> > > the first place? The practical reasons you allude to are
> arbitrary
> > > and make contract law incoherent, as Cardozo once said:
> > > 
> > > "Some courts have drawn a distinction between the formation
> of the
> > > contract and the regulation of performance.The distinction
> has been
> > > rejected in many jurisdictions. ... I think we should reject
> it now. ...
> > > I think it is inadequate to say that oral changes are
> effective if
> > > they are slight and ineffective if they are important. Such
> tests
> > > are too vague to supply a scientific basis of distinction.
> ... The
> > > field is one where the law should hold fast to fundamental
> > > conceptions of contract and of duty, and follow them with
> loyalty to
> > > logical conclusions." 
> > > 
> > > So I would argue that you are confusing prudence and logic.
> So I
> > > still think that A serious attack on pre-exisitng duty is an
> attack
> > > on consideration.
> > > 
> > > The Roman law of contract, in this respect (and others) was
> not a
> > > beacon of coherence, see Hegel's discussion in /Philosophy
> of Right, /§ 79.
> > > 
> > > 
> > > Jason Neyers
> > > Associate Professor of Law & 
> > > Cassels Brock LLP Faculty Fellow in Contract Law Faculty of
> Law
> > > University of Western Ontario N6A 3K7
> > > (519) 661-2111 x. 88435
> > > 
> > > 
> > > 
> > > Andrew Tettenborn wrote:
> > > > Jason Neyers wrote:
> > > >> 
> > > >> Dear Colleagues:
> > > >> 
> > > >> I have already informed Mr. Adrian that the ODG is not a
> forum
> > > >> for getting answers for essay questions but for serious
> > > >> discussion of the law.
> > > >> 
> > > >> With that in mind, and although this would be a minority
> position
> > > >> (possibly of 2), I think that the decision in Williams v
> Rofey
> > > >> Bros is a conceptual disaster.
> > > >> 
> > > >> What are the problems? First, it is inconsistent with
> binding
> > > >> authority (such as Foakes v Bears) and the whole line of
> cases
> > > >> dealing with pre-existing duty.
> > > >> 
> > > >> Second, the pre-existing duty doctrine is one that is
> > > >> conceptually
> > > >> sound: in a legal system where one needs to pay a price
> to have a
> > > >> promise enforceable it makes sense that something that is
> already
> > > >> the entitlement of the other party cannot count as a
> price.
> > > >> 
> > > >> Third, the dual concepts deployed by the court of duress
> and
> > > >> practical benefit do not fit together as an integrated
> whole. If
> > > >> there is no duress why would we care if there was a
> practical
> > > >> benefit (where was the practical benefit in Hamer v
> Sidway?).
> > > >> Likewise if there is a practical benefit why should we
> care if
> > > >> there is duress, the promise is beneficial for you.
> > > >> 
> > > >> Fourth, on one view the concepts deployed lead to an
> infinite
> > > >> regression: if it is a practical benefit to have actual
> > > >> performance since it is always a possibility that a
> legally
> > > >> binding promise might be breached how is this solved by
> having a
> > > >> second legally binding promise? In essence, it is
> applying social
> > > >> science (statistical) reasoning to what is a normative
> > > >> non-statistical question: do I have a right to
> performance and you the comnicant duty.
> > > >> 
> > > >> In the end, the rightness or wrongness of Roffey is tied
> to
> > > >> consideration. A serious attack on the pre-existing duty
> doctrine
> > > >> is a serious attack on the doctrine of consideration--
> they stand
> > > >> or fall together.
> > > >> 
> > > >> Moreover, the result in Williams v Rofey cannot be saved
> by the
> > > >> application of promissory estoppel because there appears
> to be no
> > > >> detriment suffered by the promisee and according to the
> finest
> > > >> legal minds who take coherence seriously (ie not Lord
> Denning),
> > > >> detriment is a requirement of promissory (and almost all)
> estoppels.
> > > >> 
> > > >> Sincerely,
> > > >> 
> > > >> 
> > > >> ----- Original Message -----
> > > >> From: Bashaija Adrian <bashaijadrian@yahoo.com> 
> > > >> Date: Thursday, November 20, 2008 5:53 pm
> > > >> Subject: need some help guys
> > > >> To: obligations@uwo.ca
> > > >> 
> > > >> > hope you all alright... is there anyone who can bail me
> out on
> > > >> > this question to top up my understanding, i have most
> of it and
> > > >> > would like to know your oppinions and cross
> reference...
> > > >> > 
> > > >> > QN. has the case of WILLIAMS v ROFFEY Bros & NICHOLLS
> > > >> > (1991) 1 QB 1 in the united kingdom a positive or
> nagative
> > > >> > development to the principle of consideration? and to
> what
> > > >> > extent?
> > > >> > 
> > > >> > thanks alot guys this forrum is brilliant.
> > > >> > 
> > > >> > Macus
> > > >> > 
> > > >> > 
> > > >> > 
> > > >> > 
> > > >> 
> > > >> --
> > > >> Jason Neyers
> > > >> Associate Professor of Law & 
> > > >> Cassels Brock LLP Faculty Fellow in Contract Law Faculty
> of Law
> > > >> University of Western Ontario N6A 3K7
> > > >> (519) 661-2111 x. 88435
> > > >> 
> > > >> 
> > > >> > 
> > > >> > 
> > > >> > --------------------------------- I've signed you up.
> > > >> > 
> > > >> > ----- Original Message -----
> > > >> > From: Bashaija Adrian <bashaijadrian@yahoo.com> 
> > > >> > Date: Monday, November 17, 2008 2:46 am
> > > >> > Subject: joining dicussion group
> > > >> > To: jneyers@uwo.ca
> > > >> > 
> > > >> > > dear Nr Neyers
> > > >> > > 
> > > >> > > Hope all is well for you. I have been reading
> > > >> > throught
> > > >> > > the posts on the discussion group and have picked a
> keen
> > > >> > > interest in joining. I dont know how its done
> > > >> > but
> > > >> > > I am a second year Law student in the United
> > > >> > Kingdom.
> > > >> > > 
> > > >> > > Please advise
> > > >> > > 
> > > >> > > thank you
> > > >> > > Adrian
> > > >> > > 
> > > >> > > 
> > > >> > > 
> > > >> > > 
> > > >> > 
> > > >> > --
> > > >> > Jason Neyers
> > > >> > Associate Professor of Law & 
> > > >> > Cassels Brock LLP Faculty Fellow in Contract Law
> Faculty of Law
> > > >> > University of Western Ontario N6A 3K7
> > > >> > (519) 661-2111 x. 88435
> > > >> > 
> > > >> > 
> > > >> > 
> > > >> > 
> > > >> > 
> > > >> > 
> > > >> > 
> > > >> 
> > > >> --
> > > >> Jason Neyers
> > > >> Associate Professor of Law & 
> > > >> Cassels Brock LLP Faculty Fellow in Contract Law Faculty
> of Law
> > > >> University of Western Ontario N6A 3K7
> > > >> (519) 661-2111 x. 88435
> > > >> 
> > > > Of course Williams is a conceptual disaster: the argument
> in the
> > > > CA doesn't hang together, is transparently specious, and
> wouldn't
> > > > get that many marks if it came from one of our students.
> > > > 
> > > > The difficulty is, of course, that it's very difficult for
> anyone
> > > > -- apart perhaps from a participant at a common lawyers'
> > > > get-together -- to say, hand on heart, that they think
> Williams
> > > > ought to have lost. No layman would say so; and I suspect
> any
> > > > lawyer from France or Germany would be amazed to hear it
> seriously argued.
> > > > 
> > > > On the other hand, is an attack on Williams an attack on
> > > > consideration? I'd say no. The real problem is that,
> although the
> > > > consideration requirement started out as a doctrine about
> creating
> > > > obligations (with powerful arguments in its favour),
> English
> > > > lawyers have always blithely assumed that it /must/ extend
> to
> > > > altering, cancelling or modifying obligations (as in
> Williams, and
> > > > incidentally as in Foakes). But this certainly isn't true
> as a
> > > > matter of logic, and it seems to me that there are good
> practical
> > > > reasons for making it easier to modify existing
> obligations than
> > > > to create entirely new ones. Once accept this, and
> Williams and
> > > > consideration can happily coexist.
> > > > 
> > > > It's also worth noting that the Romans realised something
> like
> > > > this 2000 years ago. Although they didn't have
> consideration, they
> > > > had some pretty strict formal requirements for creation of
> > > > contractual liability. But for cancelling an existing
> liability?
> > > > Feel free (says the Roman): all you need to do this is a
> pactum de
> > > > non petendo (aka an entirely informal agreement in any
> form).
> > > > 
> > > > 
> > > > Andrew
> > > > 
> > > > --
> > > > Andrew Tettenborn MA LLB
> > > > Bracton Professor of Law
> > > > University of Exeter, England
> > > > 
> > > > 
> > > > Tel: 01392-263189 / +44-392-263189 (outside UK)
> > > > Cellphone: 07870-130528 / +44-7870-130528 (outside UK)
> > > > Fax: 01392-263196 / +44-392-263196 (outside UK)
> > > > 
> > > > Snailmail: School of Law,
> > > > University of Exeter,
> > > > Amory Building,
> > > > Rennes Drive,
> > > > Exeter EX4 4RJ
> > > > England
> > > > 
> > > > Exeter Law School homepage: http://www.law.ex.ac.uk
> <http://www.law.ex.ac.uk/>  My homepage:
> > > > http://www.law.ex.ac.uk/staff/tettenborn.shtml
> <http://www.law.ex.ac.uk/staff/tettenborn.shtml>  
> > > > 
> > > > 
> > > > 
> > > > 
> > > > 
> > > > LAWYER, n. One skilled in circumvention of the law
> (Ambrose
> > > > Bierce,
> > > 1906).
> > > 
> 
> 
> 
> ________________________________
> 
> Win £1000 John Lewis shopping sprees with BigSnapSearch.com
> Search now <http://clk.atdmt.com/UKM/go/117442309/direct/01/
> <http://clk.atdmt.com/UKM/go/117442309/direct/01/> >  
> 

--
Jason Neyers
Associate Professor of Law & 
Cassels Brock LLP Faculty Fellow in Contract Law
Faculty of Law
University of Western Ontario
N6A 3K7
(519) 661-2111 x. 88435