Past consideration happens when one person promises to do something for another person after the other person has already done something for them. In most cases, past consideration is not valid in contracts. This means it usually can’t be used to make a contract legally binding.
Let’s explore what this means and why it’s important in contract law.
What Is Consideration?
Consideration is something of value that both people in a contract give to each other. It’s what makes a contract fair and enforceable. For example:
If you pay someone £20 to wash your car, the £20 is your consideration, and the car-washing service is their consideration.
What Is Past Consideration?
Past consideration is when one person does something for another person without expecting anything in return at the time. Later, the other person promises to pay or give something in return.
For example:
You help your neighbor fix their fence. Later, they promise to give you £50 for your help.
Since you didn’t agree to be paid before fixing the fence, the £50 is considered past consideration. In most cases, this promise is not enforceable as a contract.
Why Is Past Consideration Not Valid?
For a contract to be valid, the consideration must happen as part of the agreement. Both people must agree to give or do something before or at the time of making the promise.
If one person makes a promise after the other person has already acted, it’s seen as a gift or favor, not a binding contract.
Are There Exceptions?
While past consideration is usually not valid, there are some exceptions:
1. Request for Services
If someone asks you to do something for them and it’s understood that they will pay or reward you later, past consideration may be valid.
For example:
Your friend asks you to design a logo for their business, and they later promise to pay you. Since the promise is tied to their original request, it might be enforceable.
2. Written Agreements
In some cases, a written agreement can turn past consideration into valid consideration, but this depends on local laws.
Examples of Past Consideration
Invalid Past Consideration:
A friend fixes your bike without asking for payment. Later, you promise to pay them £30. This is not a valid contract because the promise came after the work was already done.
Valid Exception:
You agree to babysit your neighbor’s child when asked. A week later, they pay you for the time you spent babysitting. Since there was an original request, this could be considered valid.
How to Avoid Problems with Past Consideration
Make Agreements Clear:
Always agree on payment or other terms before doing any work or providing a service.
Put It in Writing:
Written agreements are easier to enforce and help avoid confusion about what was promised.
Seek Legal Advice:
If you’re unsure whether past consideration applies to your situation, speak to a solicitor.
How Canko Law Firm Can Help
At Canko Law Firm, we help businesses and individuals with contract issues, including past consideration. Our services include:
Reviewing your contracts to ensure they are valid.
Advising you on whether a promise involving past consideration can be enforced.
Helping resolve disputes over unpaid work or broken promises.
Past consideration is tricky because it usually doesn’t count as valid in contracts. For a promise to be legally binding, both sides must agree to give or do something before or at the time the contract is made.
If you have questions about past consideration or need help with a contract, contact Canko Law Firm today. We’ll provide expert advice to protect your rights and ensure your agreements are enforceable.
