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Contract law

 If both parties gain an additional practical benefit from the new contract not
anticipated in the original agreement.

Illustration 12 – Consideration

WILLIAMS v ROFFEY BROS. 1990

Facts:

Williams agreed to do some work for Roffey Bros in a block of flats at a fixed
price by an agreed date. The work ran late and R agreed to pay extra to have the
work completed on time. If the work had overrun R would have suffered a penalty
on his own contract with the owner of the flats.

Held:

Even though W was only doing what he was contracted to do the extra payment
was good consideration as the new payment constituted a new contract from
which both R and W benefited.

R benefited by not incurring penalties on his contract with the owner of the flats
and by not having to find contractors to finish the work. Also R had approached
W to offer extra payment, there was no pressure put on him. The court held it
would have been inequitable for R to go back on his promise.

 Performance of an existing duty can be good consideration for a new contract
with a third party.

The promise to do or the act of doing an illegal act is not good consideration

The courts will not enforce a contract for an illegal purpose and as such performance
of an illegal act is not good consideration.

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