Dear Eion

 

The difficulty with this line of argument is that there were different circumstances at the time of the new agreement in Stilk v Myrick as well.  Williams and Stilk are indistinguishable unless Roffey Bros promised something more than Williams was LEGALLY entitled to -  which, as Michael Furmston has pointed out, perhaps could have been argued but was not.

 

David

________________________________

From: Eoin O'Dell [mailto:odelle@tcd.ie]

Sent: Fri 28/11/2008 11:15 AM

To: Obligations List

Subject: Consideration and Williams v Roffey

Dear all,

Although the Williams v Roffey thread has unravelled into various interesting

discussions, I'd like to go back to the issue of what constituted the

consideration on the facts of that case. The Court of Appeal identified many

practical benefits which they said sufficed, (the carpenter's continued

performance, a more orderly and efficient performance of the contract,

avoidance by the builder of the trouble and expense of obtaining a substitute,

and - especially - avoiding the penalty clauses in the head-contract). However,

the debate on the list has demonstrated that the sufficiency of these practical

benefits is controversial. Nevertheless, in my view, these formulations of

benefit tell only half the story; their focus is on the simple fact of the

promisee ultimately getting what he originally bargained for, whereas, on the

facts of Williams v Roffey, it was not so much that the promisee would

ultimately get what he originally bargained for that was important, as the fact

that he would get it _in different circumstances_.

The background market conditions had changed significantly; the carpenter's

cashflow had suffered acutely as a consequence; and the renegotiations between

the carpenter and the builder were carried out against these serious background

changes. Absent the renegotiation, the carpenter would not have been able to

proceed. By renegotiating, the builder now gets performance - indeed, improved

performance - of the contract, but it is no longer the same thing as before, it

is now something new, because it is performance _in the new circumstances_. As

such, it constitutes good consideration.

It is clear that where the background circumstances change, getting something

different is good consideration (see, eg, Hartley v Ponsonby  (1857) 7 El&Bl

872; 119 ER 1471). Again, it is clear that where the background circumstances

remain the same, getting something different is good consideration: a promisee

may provide other consideration for the new promise by doing, or promising to

do, more than what is already set out in the original contract. But if getting

something different in the same circumstances is good consideration, then why

can it not be that getting the same thing _in different circumstances_ also

constitutes good consideration?  Given the new circumstances, the contract as

originally agreed could not be performed. By negotiating to ensure that in the

new circumstances the contract can again be performed, the promisee does

receive a new benefit: without the renegotiation, the promisee receives

nothing; with it, the promisee plainly receives something, and thus receives

good consideration. Indeed, in Williams v Roffey, the various items of

practical benefit which it is said constitute the builder's consideration

really only make sense when viewed as that which is received in the context of

the new background market circumstances; getting the carpenter's performance in

the new circumstances is thus good consideration.

If this is right, then - given recent economic trends - we are likely to see

this issue return on these kinds of facts.

Eoin.

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