What is adequacy of consideration in contract law?
In law, adequacy of consideration means that for a lawful agreement to be made between two parties, the offeree, also known as the beneficiary, must give in return, a fair price, that is either in equal measure or reasonably proportional to the value given by the offeror, also known as the benefactor.
What is Section 74 of Indian Contract Act?
[When a contract has been broken, if a sum is named in the contract as the amount to be paid in case of such breach, or if the contract contains any other stipulation by way of penalty, the party complaining of the breach is entitled, whether or not actual damage or loss is proved to have been caused thereby, to …
What is Section 73 of Indian Contract Act?
Section 73 of the Act provides that “When a contract has been broken, the party who suffers by such breach is entitled to receive, from the party who has broken the contract, compensation for any loss or damage caused to him thereby, which naturally arose in the usual course of things from such breach, or which the …
Is adequacy of consideration necessary?
Consideration need not be adequate- It is not necessary that the consideration is equal or adequate for the promise made. However, it is mandatory that the consideration should be something in which the law attaches some value. It is for the parties to decide the value of the consideration and not a court of law.
What are the 3 requirements of consideration?
There are three requirements of consideration: 1) Each party must make a promise, perform an act, or forbear (refrain from doing something). 2) Each party’s promise, act, or forbearance must be in exchange for a return promise, act, or forbearance by the other party.
What is Section 39 of Indian Contract Act?
39. Effect of refusal of party to perform promise wholly.—When a party to a contract has refused to perform, or disabled himself from performing, his promise in its entirety, the promisee may put an end to the contract, unless he has signified, by words or conduct, his acquiescence in its continuance. —
What is pledge contract?
Pledge, Pawnor and Pawnee defined. -The bailment of goods as security for payment of a debt or performance of a promise is called pledge. A valid contract of pledge involves the bailment of goods, as defined under section 148[6] of the Act as security for the debt.
What is Section 10 of Indian contract Act?
Section 10 of Indian Contract Act 1872 : “What agreements are contracts” 10. All agreements are contracts if they are made by the free consent of parties competent to contract, for a lawful consideration and with a lawful object, and are not hereby expressly declared to be void.
What is Section 75 of Indian Contract Act?
75. Party rightfully rescinding contract, entitled to compensation. —A person who rightfully rescinds a contract is entitled to compensation for any damage which he has sustained through the non-fulfilment of the contract.
What is the difference between sufficiency and adequacy of consideration?
The term “sufficiency” describes something that the courts can see of value that makes the bargain binding, whilst “adequacy” may describe the full value of something. Hence, the law requires consideration to be something of sufficient value, but not necessarily the full or adequate market value.
