Question

In relation to Contracts Act 1950, explain what is meant by “consideration need not be adequate but must be sufficient”. (10 mark

Answer 1

Consideration is a fundamental element of the contract. However, consideration need not be adequate but must be sufficient. It means that consideration must have some value but that value need not be equal to the value of the exchange as per contract as long as there is a consent of both parties.

For example, Mr. A agreed to sell his car worth $30,000 for $10,000 to Mr. B. In this case, there is a mismatch between the consideration received and consideration paid. But this will not make the contract void as long as there is the consent of both parties to honor it.

Hi mate,

I would be grateful to you if you can provide a thumbs up and write one beautiful comment. It will improve my rating and let me continue my journey here.

In case of doubt, please comment. I will consider myself fortunate if I can help you.

All the best for your bright future.

Be safe from the corona. Wear a mask before going out and wash hands frequently especially before touching the face