SOURCE 10
While consideration remains a fundamental requirement before a contract
not under seal can be enforced, the policy of the law in its search to do
justice between the parties has developed considerably since the early
nineteenth century when Stilk v Myrickwas decided. In the late twentieth
century I do not believe that the rigid approach to the concept of
consideration to be found in Stilk v Myrickis either necessary or desirable.
Consideration there must still be but in my judgment the courts nowadays
should be more ready to find its existence so as to reflect the intention of
the parties to the contract where the bargaining powers are not unequal and
where the finding of consideration reflects the true intention of the parties.
Adapted from the judgment of Russell LJ in Williams v Roffey Bros and Nicholls
(Contractors) Ltd[1990] 1 All ER 512 CA.
SOURCE 11
If a party performs an act which is merely a discharge of a pre-existing
obligation, there is no consideration, but where a party does more than he
278 Contract law
This extract is one of several speeches and does not set out the facts.You
should therefore revise the facts of Williams v Roffeyand know the basis of
the decision, so that you can set it in the context of the precedent of the
other existing duty cases and discuss its merits.Another extract from the same case, this time from the judgment of Russell
LJ. The fact that there is so much on this case in the booklet indicates the
importance that lawyers have placed upon it. Note that the case reached the
Court of Appeal but not the House of Lords.There is still, then, a possibility
of it being overruled one day. However, many lawyers believe that it is time
that the courts did not just rely on the precedent of Stilk v Myrickbut review
the area of existing duty, especially in the context of modern commerce, such
as the building trade. This case is therefore welcomed by many as a modern
approach to the practical difficulties encountered in such contracts.
Russell LJ is of the opinion here that, especially where parties are of equal
standing, the courts should be more willing to ‘find’ consideration in order to
do justice and reflect the intention of the parties.
A case that followed Williams v Roffey is Re Selectmove.It could have
confirmed the decision but actually went against it. However,Re Selectmove
concerned part payment of a debt of income tax to the Inland Revenue, so may
be considered partly as a policy decision and to turn on its own particular facts.