Restatement (Second) of Contracts · Section § 71
This section outlines the necessity of consideration in a contract and distinguishes between sufficient and legally adequate consideration.
Source: Restatement Restatement (Second) of Contracts § § 71
To make a promise binding, there must be consideration, which consists of a performance or a return promise that is sought by the promisor and given by the promisee in exchange for the promisor's promise.
A contract requires consideration, meaning that something of value must be exchanged between the parties. This can be a performance of an act or a promise to perform in the future, and it must be something the promisor wants in return for their own promise.
Consideration must be sufficient but need not be adequate; it must reflect a legal detriment or benefit.
Past consideration is not valid; consideration must be bargained for in exchange for a promise.
Illustration 1
If A promises to pay B $100 in return for B's promise to deliver a book, both elements are in consideration.
Illustration 2
If A previously gave B a gift and then later decided to ask B for a favor without new consideration, A cannot enforce the favor as a contract.
This case illustrates that forbearance from a legal right is sufficient consideration.
This case emphasizes that past consideration cannot support a present promise.
Understanding the requirements for consideration is critical for enforcing contracts. Parties must ensure that their agreements involve a mutual exchange of value to avoid disputes about enforceability.