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How is consideration distinguished from the doctrine of past consideration?

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Answer:

Essentially past consideration in common law is by its nature not consideration. Consideration is defined as a bargain for exchange. Where one element of a deal has already occurred before the deal began, there was no bargain. If for example, you give me a shiny stone as a gift. A couple weeks later, we find out that the stone is a rare ruby worth millions. I decide that I'm going to sell it and promise to give you 1/2 of the earnings in consideration for you giving me the stone in the first place. The reason that this is not consideration is that there must be a bargain. You must do something to entice me to do something in return, and I must do something to entice you to do something in return. Promising to give you 1/2 of the earnings did not entice you to give me the stone in the first place, so therefore there was no bargain in place and my promise is merely a gift. However, most states authorize past consideration though statute in specific situations. For example New York authorizes past consideration under General Obligations Law § 5-1105.

Contributor:

Sean

First answer by Sean Myers. Last edit by Sean Myers. Contributor trust: 1 [recommend contributor ]. Question popularity: 2 [recommend question].

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