contract-law england-and-wales
How can consideration be past when the offeror demanded a price, and all discussion of consideration precedes the contract signing?
<p>How does the issue of past consideration arise at all? I'm relying on the paragraphs chronologically. Obviously P's acceptance (see bold below) precedes 'P and D signed a contract'. Then any consideration from D (for P's promise to sell the bicycle) must hail from the £50 that P's demanding. I.e. 'in consideration of the excellent work' can't form any part of consideration, because P's also demanding £50 from D.</p>
<p>Here's the problem question.</p>
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<p>Plaintiff decided to sell his bicycle. He advertises as follows:</p>
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<blockquote>
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<p>FOR SALE<br />
Bicycle £49 (price negotiable)<br />
Please call: 020 1234 5678 to accept this offer – first come, first served.</p>
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<p>Defendant, a mechanic, had always looked after P’s bicycles. D wanted to buy this bicycle but the most he could scrape together was £25. He rang P to ask whether P would consider accepting £25 now and the balance over the next five years at £5 per year. P said <strong>‘the price is £50, but in consideration of the excellent work you have always carried out on my bicycles, I accept your proposal’ [Call this P's Acceptance]</strong>.</p>
<p>P and D signed a contract detailing the arrangement and D said D would collect the bicycle the following day. Later that day P changed his mind and contacted D to say that D couldn't have the bicycle unless D paid the full price immediately.</p>
<p>D believes he has the right to the bicycle in accordance with the signed agreement. But P argues that<br />
1. there was not sufficient consideration for D's promise, and<br />
2. even if there was sufficient consideration, the variation promise was not binding on P.</p>
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<p>Here's the relevant part of my textbook's answer.</p>
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<p>Was the consideration from D sufficient? P’s statement “in consideration of the excellent work you have always carried out on my bicycles, I accept your proposal” suggests that P would be using past consideration to support the price variation. P's statement looks like past consideration (<em>Lampleigh, Pao On</em>) and therefore not sufficient. So no contract to vary.</p>
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<p>I would say that when P accepts D's offer, and P and D sign a contract, that P and D have formed a contract. The consideration for P is the £25 at once plus the promise of £5 per year until £50 is paid. The consideration for D is the bicycle.  As P advertised that the price was negotiable it was reasonable for D to offer this deal, and P could chose to accept or not. Having accepted unconditionally P cannot undo the deal without D's consent. If D had been a company, consumer protection law might give P a period within which P had a right to cancel, but that would not apply between two private individuals. P is taking into account past good will in accepting a lesser consideration than P's advertisement asked, but that is not really consideration for the contract, just a factor influencing P's decision to accept the offer.</p>
