- Edwin Patterson, ‘An Apology for Consideration’ (1958) 58 Columbia Law Review 929, 936.
- Stilk v Myrick [1809] EWHC KB J58 (King's Bench Division (KBD)).
- For instance, that a promise to give up a groundless claim is good consideration (Callisher v Bischoffsheim LR (1869–70) LR 5 QB 449 (Queen's Bench Division (QBD))), and that the performance of a pre-existing duty to a third-party is good consideration (Shadwell v Shadwell [1860] EWHC CP J88 (Court of Common Pleas (CPP))). See James Ames, ‘Two Theories of Consideration’ (1899) 12 Harvard Law Review 67.
- Reiter lists four: (1) finding a promise to do more than what one has previously undertaken to do; (2) finding that a pre-existing promise is good consideration in changed circumstances; (3) through a number of reliance-based concepts including estoppels and waivers; and (4) by finding that parties had abandoned a pre-existing contract and entered into a ‘new’ contract. See Barry Reiter, ‘Courts, Consideration and Common Sense’ (1977) 27 University of Toronto Law Journal 439, 474.
- [1991] 1 QB 1 (Court of Appeal (CA)).
- See Roger Halson, ‘Sailors, Sub-Contractors and Consideration’ (1990) 106 Law Quarterly Review 183, 184–85; Andrew Phang, ‘Consideration at the Crossroads’ (1991) 107 Law Quarterly Review 21, 21–22.
- Modern examples may be found in a trilogy of Singaporean decisions: Chwee Kin Keong v Digilandmall. com Pte Ltd [2004] 2 SLR(R) 594 (Singapore High Court (SHC)); Sunny Metal & Engineering Pte Ltd v Ng Khim Ming Eric [2007] 1 SLR(R) 853 (Singapore Court of Appeal (SCA)); and Gay Choon Ing v Loh Sze Tie Terrence Peter [2009] 2 SLR(R) 332 (SCA). See also Mindy Chen-Wishart, ‘Consideration and Serious Intention’ [2009] Singapore Journal of Legal Studies 434; and Koo Zhi Xuan, ‘Envisioning the Judicial Abolition of The Doctrine of Consideration in Singapore' (2011) 23 Singapore Academy of Law Journal 463.
- [2003] 2 NZLR 23 (New Zealand Court of Appeal (NZCA)).
- (2008) 290 DLR (4th) 405 (New Brunswick Court of Appeal (NBCA)).
- Antons (n 8) [5].
- This latter understanding was not explicit on the facts but appeared to have been assumed by Baragwanath J. Without this crucial assumption, it would be difficult to see why there was even a variation of contract. See C Ulyatt, ‘The Demise of Consideration for Contract Variations' (2003) 9 Auckland University Law Review 1386, 1392.
- ATCL also unsuccessfully challenged the scope of its promise and alleged that Smith had not met the conditions that would entitle him to the promised reward. Antons (n 8) [59]–[85].
- Williams v Roffey (n5).
- By reference to Professor Brian Coote's criticisms of that case, which the learned judge restated as ‘the mere performance of a duty already owed to the promisee under a contract cannot constitute consideration and that the only principled way to such a result is to decide that consideration should not be necessary for the variation of contract.’ Antons (n 8) [92].
- Antons (n 8) [93].
- Antons (n 8) [92], citing Reiter (n 4) 507.
- NAV Canada (n 9) [31].
- NAV Canada (n 9) [28]–[30].
- NAV Canada (n 9) [29].
- NAV Canada (n 9) [28].
- NAV Canada (n 9) [32].
- NAV Canada (n 9) [27].
- NAV Canada (n 9) [32].
- NAV Canada (n 9) [32].
- NAV Canada (n 9) [43].
- NAV Canada (n 9) [46], citing Hillspring Farms Ltd v Leland Walton & Sons Ltd [2007] NBCA 7, (2007) 312 NBR (2d) 109 (NBCA).But see the criticisms of Rick Bigwood, ‘Doctrinal Reform and Post-Contractual Modifications in New Brunswick: Nav Canada v Greater Fredericton Airport Authority Inc’ (2010) 49 Canadian Business Law Journal 256, 273.
- NAV Canada (n 9) [47].
- NAV Canada (n 9) [52].
- NAV Canada (n 9) [53].
- NAV Canada (n 9) [55].
- NAV Canada (n 9) [53].
- NAV Canada (n 9) [60].
- NAV Canada (n 9) [47]–[48] and [61]–[63].
- NAV Canada (n 9) [50], [63], endorsing the arguments of M H Ogilvie in ‘Forbearance and Economic Duress: Three Strikes and You're Still Out at the Ontario Court of Appeal' (2004) 29 Queen's Law Journal 809, 821.
- NAV Canada (n 9) [64]–[67].
- Antons (n 8) [92]–[93].
- NAV Canada (n 9) [26].
- Williams (n 5) 10–11 (Glidewell LJ), 19 (Russell LJ).
- As was the case in Williams v Roffey. See Dan Halyk, ‘Consideration, Practical Benefits and Promissory Estoppel: Enforcement of Contract Modifcation Promises in Light of Williams v Roffey Brothers’ (1991) 55 Saskatchewan Law Review 393, 399. The difficulties associated with this extension are discussed in Mindy Chen-Wishart, ‘Consideration: Practical Benefit and the Emperor's New Clothes' in Jack Beatson and Daniel Friedmann (eds), Good Faith and Fault in Contract Law (Clarendon Press 1995), 129–131.
- Brian Coote, ‘Consideration and Benefit in Fact and in Law' (1990) 3 Journal of Contract Law 23, 26.
- Chen-Wishart (n 39) 123–24, 131–32, 138. See also Norma Hird and Ann Blair, ‘Minding Your Own Business—;Williams v Roffey Revisited: Consideration Re-considered’ [1996] Journal of Business Law 254, 256–57; and Halyk (n 39) 398.
- See eg Mindy Chen-Wishart, ‘The Enforceability of Additional Contractual Promises: A Question of Consideration?’ (1991) 14 New Zealand Universities Law Review 270, 279 (but the author has since developed an alternative interpretation of ‘practical Benefits’, see Mindy Chen-Wishart, ‘A Bird in the Hand—;Consideration and Contract Modifications' in A Burrows and E Peel (eds), Contract Formation and Parties (OUP 2010).
- See Chen-Wishart, ‘The Enforceability of Additional Contractual Promises' (n 42) 278; and Margaret Ogilvie, ‘Of What Practical Benefit is Practical Benefit to Consideration?’ (2011) 62 University of New Brunswick Law Journal 131, 133–34.
- See Halson (n 6) and Phang (n 6).
- Brian Coote, ‘Variations Sans Consideration’ (2011) 27 Journal of Contract Law 185, 187.
- Francis Dawson, ‘Contract as Assumption and Consideration Theory: A Reassessment of Williams v Roffey Bros’ (2011) 42(1) Victoria University Wellington Law Review 135, 158.
- As Chen-Wishart put it, ‘[w]e bargain for performance, but what we get is a more fragile right in remedial terms. The unpalatable truth is that there is no straightforward equivalence between the two.’ Chen-Wishart, ‘A Bird in the Hand’ (n 42) 93.
- C J Hamson, ‘The Reform of Consideration’ (1938) 54 Law Quarterly Review 233, 238; Arthur Lehman Goodhart, ‘Performance of an Existing Duty as Consideration’ (1956) 72 Law Quarterly Review 490, 492.
- Dawson (n 45) 156.
- This may be the case where, for instance, the contract is already very near its end. In the Singaporean Court of Appeal decision in Sea-Land Service Inc v Cheong Fook Chee Vincent [1994] 3 SLR 631 (SCA) 635, it was found that an employer who had promised enhanced severance payment to a retrenched employee had derived no factual Benefit from the latter's work in the last month of his employment since a company would only retrench employees who were no longer essential to its operations.
- Chen-Wishart, ‘A Bird in the Hand’ (n 42).
- Chen-Wishart, ‘A Bird in the Hand’ (n 42) 96.
- Chen-Wishart, ‘A Bird in the Hand’ (n 42) 97.
- But the remedies awarded in the case are also consistent with an analysis based on bilateral contracting since both the trial judge and the Court of Appeal had accepted that the obligation to pay the increased amount was conditional upon the completion (or substantial completion) of work in respect of each fat. See Williams v Roffey (n 5) 8.
- But it has been observed that this mechanism is somewhat complex, and the supposition that all contract Modifications are effected by way of unilateral contracts may in many cases run counter to parties' intention. See Ewan McKendrick, Contract Law (9th edn, Palgrave Macmillan 2011) 83. It may be reasonable to surmise, for example, that Roffey Bros (the defendants) would not have agreed to the variation if it had known at the time that the new agreement did not oblige Williams (the plaintiff) to perform but merely gave him an option to do so. Of course, this may be of little practical significance if Williams was still bound to perform under the original contract. But the remedial consequences of bilateral and unilateral contracting may differ depending on the precise time at which the contract is said to have been formed, and this difference may sometimes be crucial.
- Chen-Wishart (n 39) 128. At first sight, this proposition may appear to contradict Chen-Wishart's main thesis in her more recent work (Chen-Wishart, ‘A Bird in the Hand’ (n 42)) which contends that it is the critical distinction between receipt of performance and the mere right to perform that renders it necessary to resort to the unilateral contract device. But this is not necessarily so. To acknowledge that performance is worth more than a mere promise does not necessarily preclude the possibility that the same promise cannot confer different values in different circumstances.
- Reynolds and Treitel have also argued that the fact of under-price is a consideration that favours enforcement: ‘The conduct of the promisor might, again, be relevant if in the original contract he secured some harsh or unfair advantage over the promisee—;if, for example, he employed the promisee at rates of pay well below the current ones. The suggestion here is not that the court should reopen the transaction for inadequacy of consideration. But where the parties themselves have reopened it on this ground, the court should enforce their new agreement.’ Francis Reynolds and Guenter Treitel, ‘Consideration for the Modification of Contracts' (1965) 7 Malaya Law Review 1, [20] (emphasis added).
- A point raised by counsel for the subcontractor in argument, see Williams v Roffey (n 5) 4.
- Indeed, it is significant that counsel for the main contractor had conceded that his client had secured Benefits from promising to pay more notwithstanding that complete performance was not eventually rendered. See Williams v Roffey (n 5) 16.
- Antons (n 8) [93].
- ibid.
- Chen-Wishart, ‘A Bird in the Hand’ (n 42) 106; Craig Ulyatt, ‘The Demise of Consideration for Contract Variations' (2000–2003) 9 Auckland University Law Review 1386, 1395; and Karen N Scott, ‘From Sailors to Fisherman: Contractual Variation and the Abolition of the Pre-existing Duty Rule in New Zealand’ (2005) 11 Canterbury Law Review 201, 216.
- Edwards v Skyways Ltd [1964] 1 WLR 349 (QBD) 355.
- Thus, Hedley concludes that no intention to create legal relations is really required in these cases. See Steve Hedley, ‘Keeping Contract in its Place—;Balfour v Balfour and the Enforceability of Informal Agreements’ (1985) 5 Oxford Journal of Legal Studies 391, 412.
- A point repeatedly made by commentators: see J Unger, ‘Intention to Create Legal Relations, Mutuality and Consideration' (1956) 19 Modern Law Review 96; Hedley (n 63); Bob Hepple, ‘Intention to Create Legal Relations’ (1970) 28 Cambridge Law Journal 122, 134; Roger Brownsword, ‘Of Cups and Coins and Contracts’ (1976) 27 Northern Island Legal Quarterly 414; Gregory Klass, ‘Intent to Contract’ (2009) 95 Virginia Law Review 1437, 1459–60; Ilija Vickovich, ‘The Modern Animus Contrahendi: Focusing on Intention Through a ‘Contemporary Lens’’ (2011) 13 Flinders Law Journal 95.
- NAV Canada (n 9) [27].
- ibid [28].
- Karl Llewellyn, ‘What Price Contract?—;An Essay in Perspective' (1931) 40 Yale Law Journal 704, 742.
- Samuel Stoljar, ‘The Modification of Contracts' (1957) 35 Canadian Bar Review 485, 486–87.
- Tan Cheng Han, ‘Contract Modifications, Consideration and Moral Hazard’ (2005) 17 SACLJ 566, 578.
- Llewellyn (n 68) 717.
- Which still provides the most compelling explanation for contractual liability because ‘[the] conceptual core of contract is the self-interested exchange’. Chen-Wishart (n 7) 451.
- ibid 446.
- NAV Canada (n 9) [7].
- An approach commended for its ‘considerable simplicity and elegance’: see Margaret Ogilvie, ‘Economic Duress: an Elegant and Practical Solution' (2011) 3 Journal of Business Law 229, 242
- Patrick Atiyah, ‘Economic Duress and the Overborne Will’ (1982) 98 Law Quarterly Review 197, 200. See also Universe Tankships Inc of Monrovia v International Transport Workers Federation (The Universe Sentinel) [1983] 1 AC 366, 400; Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) 19 NSWLR 40 (New South Wales Court of Appeal (NSWCA)) 45–46.
- Thus rendering the contract ‘defeasible’: see Chen-Wishart (n 7) 446.
- Atiyah (n 76) 202.
- Stephen A Smith, ‘Contracting Under Pressure: A Theory of Duress' (1997) 56 Cambridge Law Journal 343, 361. See also Elisabeth MacDonald, ‘Duress by Threatened Breach of Contract’ [1989] Journal of Business Law 460, 464–67.
- This must be distinguished from the question of causation, i.e. whether the coercee succumbed because he had no reasonable alternative. In this context, there is clearly a need to establish subjective inducement. See Huyton SA v Peter Cremer GmbH & Co [1999] l Lloyd's Rep 620 (England and Wales High Court (Commercial Division) (EWHC (Comm))) 638 (Mance J).
- NAV Canada (n 9) [55] (Robertson JA).
- S M Waddams, ‘Unconscionable Contracts: Competing Perspectives' (1999) 62 Saskatchewan Law Review 1, 8.
- Bigwood (n 26) 275–76. Cf M H Ogilvie, ‘Economic Duress in Contract: Departure, Detour or Dead End?’ (2001) 34 Canadian Business Law Journal 194, 223 (Argued that the absence of practical alternatives is the more appropriate test for economic duress because it is ‘externally and factually verifiable’).
- See MacDonald (n 79) 467.
- Rick Bigwood, ‘Coercion in Contract: The Theoretical Constructs of Duress' (1996) 46 University of Toronto Law Journal 201, 206.
- NAV Canada (n 9) [46] (Robertson JA).
- The term ‘right’ is clearly not intended as a Hohfeldian claim-right but is more accurately a liberty to breach subject to the liability to pay damages. This draws from the Holmesian view that a contracting party may choose either to perform or breach on payment of damages but suffers from the fundamental weakness that it seeks to equate a contractual right with the remedy that vindicates it. See eg Daniel Friedman, ‘The Efficient Breach Fallacy’ (1989) 18 Journal of Legal Studies 1, 1.
- Hamish Stewart, ‘A Formal Approach to Contractual Duress’ (1997) 47 University of Toronto Law Journal 175, 199; Bigwood (n 26) 271–72.
- See Andrew Phang, ‘Economic Duress: Recent Difficulties and Possible Alternatives’ [1997] Restitution Law Review 53, 57–58.
- [1983] 1 AC 366 (HL).
- See eg Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) 19 NSWLR 40 (NSWCA); McIntyre v Nemesis DNK Ltd [2009] NZCA 329; Sharon Global Solutions Pte Ltd v LG International (Singapore) Pte Ltd [2001] 2 SLR(R) 233 (SHC); E C Investment Holding Pte Ltd v Ridout Residence Pte Ltd[2011] 2 SLR 232 (SHC).
- Three cases decided by the Ontario Court of Appeal are commonly cited: Stott v Merit Investment Corp (1988) 63 OR (2d) 545 (Ontario Supreme Court, Court of Appeal (OSCA)); Gordon v Roebuck refex (1992) 9 OR (3d) 1 (Ontario Court of Appeal (OCA)); Techform Products Ltd v Wolda (2001) 56 OR (3d) 1 (OCA). These authorities were criticised by Robertson JA as unthinking reception of the ‘illegitimacy’ test into Canadian law. See NAV Canada (n 9) [44].
- See Bigwood (n 85) 229. So illegitimacy has been equated with the doctrine of unconscionability in equity in Australia: see Ross McKeand, ‘Economic Duress—;Wearing the Clothes of Unconscionable Conduct’ (2001) 17 Journal of Contract Law 1.
- Nelson Enonchong, Duress, Undue Infuence and Unconscionable Dealing (Sweet & Maxwell 2006) [3–004].
- The classic example is D&C Builders v Rees [1966] 2 QB 617 (EWHC (Comm)). Notably, this was also a point conceded by Robertson JA in NAV Canada in spite of his preference for a victim-centered approach. see NAV Canada (n 9) [48]. The relevance of the coercer's state of mind has also been accepted in other Commonwealth jurisdictions. In McIntyre v Nemesis DNK Ltd [2009] NZCA 329 [35], a decision of the New Zealand Court of Appeal, the finding that the alleged coercer did not set out to deliberately harm the contractual relationship was thought to be significant in negating illegitimate pressure. See also Sharon Global Solutions Pte Ltd v LG International (Singapore) Pte Ltd [2001] 2 SLR(R) 233, [30] (SHC).
- See DSND Subsea Ltd v Petroleum Geo Services Asa [2000] EWHC 185 (TCC) (England and Wales High Court (Techonology and Construction Court)) and Carillion Construction Ltd v Felix (UK) Ltd [2001] BLR 1 (EWHC).
- Enonchong (n 94) [3–012]. Moreover, little or no weight will be attached to a party's ‘good faith’ if it is founded on a wholly unreasonable belief: Adam Opel GmbH and another v Mitras Automotive UK Ltd [2007] EWHC 3252, [34] (QB) (David Donaldson QC (sitting as a Deputy Judge of the High Court)).
- North Ocean Shipping Co Ltd v Hyundai Construction Co Ltd, The Atlantic Baron [1979] 1 QB 705 (EWHC (Comm)). For a more recent example, see Progress Bulk Carriers Ltd v Tube City IMS LLC [2012] All ER (D) 122 (EWHC).
- Huyton SA v Peter Cremer GmbH & Co [1999] 1 Lloyd's L Rep 620 (QBD) 637–38.
- Hamson (n 48) 234 (‘Consideration, offer and acceptance are an indivisible trinity, facets of one identical notion which is that of bargain.’).
Oxford University Commonwealth Law Journal
Volume 12, 2012 - Issue 2