Stands for principle that courts may now recognise a
‘practical’ benefit as consideration.
‘practical’ benefit as consideration.
Defendant, aware that plaintiff sub-contractor might
not finish work on time, agreed to pay extra if deadline met.
not finish work on time, agreed to pay extra if deadline met.
Plaintiff was not then fully paid this extra money.
In Court of Appeal, Glidewell LJ:
Following cases such as Pau On, situation is:
If result of A’s promise to perform contractual obligations
on time means that B obtains benefit or obviates disbenefit then this is
capable of being consideration for B’s promise of additional payment.
on time means that B obtains benefit or obviates disbenefit then this is
capable of being consideration for B’s promise of additional payment.
Limits and refines principle in Stilk v Myrick, but does not contravene.
Defendant here had obtained benefit, so there was consideration
to support agreement to make bonus payments.
to support agreement to make bonus payments.
[Will the recognition of ‘practical’ benefit as consideration
change much?
change much?
Probably not, eg in context of part-payment of money
debt, Court of Appeal has declined to have regard to ‘practical’ benefit.]
debt, Court of Appeal has declined to have regard to ‘practical’ benefit.]
