Contract law cases: Alliance Bank Ltd v Broom (1864)

In Alliance Bank Ltd v Broom (1864) the plaintiff, a bank, asked the defendant to provide some security for his overdraft. The defendant promised to do so but never provided the security and the plaintiff sued. The defendant argued that there was no consideration for his promise to provide security but the courts held that the bank’s implied promise not to sue should the defendant provide the appropriate or relevant security was consideration enough. A promise not to sue can also be sufficient consideration.

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Contract law cases: Foakes v. Beer (1884)

In Foakes v. Beer (1884) the defendant owed the plaintiff a certain amount of money and made an arrangement with the plaintiff to pay it off in installments but no mention was made of the interest. The defendant eventually paid off the full debt as promised but the plaintiff brought an action for the outstanding interest. Pinnel’s rule was applied and the plaintiff was successful.

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Contract law cases: Pinnel’s Case (1602)

In Pinnel’s Case (1602) the defendant paid off part of his debt and hoped that he would be discharged. The plaintiff brought an action for the outstanding debt and was successful in his claim. In instances of debts, the rule of thumb is that part payment will not amount to sufficient consideration.

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Land Law – overreaching II

An interest in land in addition to being an equitable interest and a legal interest can also be divided into a registered interest or an interest registered as per the Land Charges Act 1925 and an unregistered interest, normally an equitable interest for example where A and B contributed equally to the purchase of a home but the legal interest is vested in A. Both parties have financially contributed to the purchase of the home i.e. given consideration but the legal interest is vested only in A and in such instances, the other party, B, has an equitable interest in the home.

In these type of situations the doctrine of notice steps in to ensure that the holder of the equitable interest is not put out of pocket because the land has been sold to a third party by the legal owner or the holder of the legal interest. The interest of a bona fide purchaser (a legitimate purchaser who has complied with the law with regards to the sale and purchase of land) will take precedence over the rights of the holder of the equitable interest. However, the holder of the equitable interest will be reimbursed or compensated via the mechanism of overreaching.

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Contract law cases: Collins v Godefrey (1831)

In Collins v Godefrey (1831), the plaintiff had been subpoenaed for jury duty. While he didn’t actually go on duty, he was on standby for 6 days. He later brought an action against the defendant for expenses incurred. His claim failed. They court held that an existing public duty does not amount to consideration.

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Contract law cases: White v. Bluett (1853)

In White v. Bluett (1853) the defendant owed his father some money but his father had promised him that he would write off the debt if his son stopped complaining as to how the property was distributed among the children.

Upon his death, the executor sued for the outstanding debt. It was held that not complaining was not sufficient consideration and the plaintiff was successful. Consideration must have some economic value i.e. it must be in the form of monies or monies worth.

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Contract law cases: Chappell v. Nestlé (1960)

In Chappell v. Nestlé (1960), Nestle ran a promotion whereby any person who sent in 3 wrappers and a postal order for 1s and 6d would be sent a record. Chappell a copyright owner in one of the records disputed Nestle’s offer and argued that the records would normally retail at 6s or more.

The matter before the courts was to decide if the wrappers formed part of the consideration and if they did there was no possible means to ascertain their value and Chappell would be successful in obtaining an injunction preventing Nestle from distributing the records. The court held that the wrappers were indeed part of the consideration and Chappell was successful in obtaining an injunction to stop Nestle from distributing the records.

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Contract law cases: Thomas v. Thomas (1842)

In Thomas v. Thomas (1842) a dying husband transferred the ownership of his seven houses to his brother but informed him prior to death, in front of two witnesses that, he wanted his wife to be permitted to live in one of those houses.

His brother Samuel complied with his wishes and after his death he allowed his brother’s wife (Eleanor) to stay in one of the houses and had a written agreement drawn up whereby his brother’s widow was to remain in the house on the conditions that she kept the house in good repair and paid a rent of £1 per annum. The agreement continued for some years until Samuel’s death whereby the executors refused to continue with the arrangement. It was held that the rent of £1 per annum was sufficient consideration and that Eleanor could continue to remain in the house.

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Contract law cases: Re Casey Patent’s (1892)

In Re Casey Patent’s (1892) the plaintiff did some patenting work for the defendant and upon the completion of the work the defendant promised to give the plaintiff one-third of the share in the patents. The defendant later failed to comply and the plaintiff sued. The plaintiff was successful in his claim because the work was done on the understanding or the premise that the plaintiff would be given some form of remuneration or the other.

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