Valuable Consideration

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Valuable Consideration

In the formation of a valid and binding contract, something of worth or value that is either a detriment incurred by the person making the promise or a benefit received by the other person.

In contract law consideration is required as an inducement to enter into a contract that is enforceable in the courts. It is an essential element for the formation of a contract. What constitutes sufficient consideration, however, has been the subject of continuing legal debate. Contracts and courts generally use the term valuable consideration to signify consideration sufficient to sustain an enforceable agreement.

In general, consideration consists of a promise to perform a desired act or a promise to refrain from doing an act that one is legally entitled to do. Thus, a person who seeks to enforce a promise must have paid or obligated herself to pay money, delivered goods, expended time and labor, or forgone some other profitable activity or legal right. For example, in a contract for the sale of goods the money paid is the valuable consideration for the vendor, and the property sold is the consideration for the purchaser.

In early Common Law nominal consideration was sufficient to establish a contract. The consideration could be as small as a peppercorn or a cent as long as it demonstrated that the parties intended to enter into an agreement. Eventually, the courts developed the requirement of valuable consideration, but what constitutes it has varied over time. Valuable consideration does not necessarily have to be equal in value to what is received, and it need not be translatable into dollars and cents. It is sufficient for the consideration to consist of a performance or a promise to perform that the promisor (the person making the promise) regards as having value. It is not essential that the person to whom the consideration moves should be benefited, provided the person from whom it moves is, in a legal sense, injured. The injury can consist of refusing to sue on a disputed claim or to exercise a legal right. The alteration in position is regarded as a detriment that forms consideration independent of the actual value of the right relinquished.

valuable consideration

n. a necessary element of a contract, which confers a benefit on the other party. Valuable consideration can include money, work, performance, assets, a promise, or abstaining from an act. (See: contract, consideration)

VALUABLE CONSIDERATION, contracts. An equivalent for a thing purchased. Vide Vin. Ab. Consideration, B; 2 Bl. Com. 297; Consideration.

References in periodicals archive ?
With that as a backdrop, the Advisory Committee on Organ Transplantation (ACOT) Subcommittee on Valuable Consideration jumped into the fray in early November by adopting a proposal recommending the Secretary of Health and Human Services (HHS) be given the regulatory authority to define what "valuable consideration" is and, more importantly, is not.
But if the testate does not have heirs who are entitled to a portion of an inheritance, he could freely dispose of his inheritance either through documents with gratuitous use, or through documents for good and valuable consideration.
Prohibition on Purchase or SaleNo human oocyte or unfertilized blastocyst [meaning cloned embryo] may be acquired, received, or otherwise transferred for valuable consideration if the transfer affects interstate commerce.
In an effort to justify such an over-reaching clause, a prime may argue that it is entitled to such rights because the subcontractor will be performing services for them for valuable consideration.
For example, in what appears to reply in advance to charges of exploitation of poor women (who will be most tempted to sell unfertilized ova) and the commodification of human life, the amendment says clearly, "No person may, for valuable consideration, purchase or sell human blastocysts (an early form of the fetus) or eggs for stem cell research or stem cell therapies and cures.
Before the 1990 amendment, the Florida Administrative Code provided that transfers of real property to corporations by their shareholders as a contribution to capital were not subject to the documentary stamp tax if the transfer was not in exchange for valuable consideration.
This note concludes that regulations should not be enacted to repeal current prohibitions against offering valuable consideration for organs and human tissue; but rather to continue to promote organ donation within the existing regulatory framework.
Increased Internet access and security has made Web-based UPS monitoring a valuable consideration when selecting a network UPS system.
The obligation to provide a disclosure document can now be triggered by the receipt of any non-refundable valuable consideration from a prospective franchisee, whether or not of monetary value.
English law contains a long enshrined principle of privity of contract, namely the principle that a person who is not a party to an executed contract or has passed valuable consideration for it cannot benefit from that.
Reflecting a large number of supporting court cases, Revenue Canada takes the position that a gift is a voluntary transfer of property without valuable consideration.
The IRS ruled that the transfer of the policies to the trust did not constitute a transfer for valuable consideration within the meaning of section 101(a)(2).