What is an example of inadequate consideration?
Asked by: Demarco Bayer DVM | Last update: May 23, 2025Score: 4.4/5 (14 votes)
Example: A agrees to sell his car to B for $1. This is an example of inadequate consideration because the value of the car is much higher than $1. The transaction may be considered a gift or a fraud, and it may not be enforceable.
What is inadequate consideration?
The inadequacy of consideration is regarded to check whether the consent is freely given. For example- A agrees to sell his property worth Rs 1 crore to B for Rs 10,000. denies that his consent for the sale of the property was not freely given.
What is an example of consideration need not be adequate?
However, the law does not require the consideration to be equal or adequate. - **Example**: If Person A agrees to sell a car worth $10,000 to Person B for $1,000, the consideration (the $1,000) is not adequate compared to the value of the car, but the contract can still be valid.
What is an example of lack of consideration?
A promise not to act occurred when Joe promised not to sue in exchange for receiving payment for the mailbox Bill mowed down while riding the scooter. Lack of consideration occurs when only one party is obligated to act while the other holds no obligation at all.
What is an example of adequacy of consideration?
For example, if you offer to sell off your house to someone at $50,000, and in exchange, he offers services to you worth this amount, then the consideration is deemed to be adequate.
What is "Consideration" in Contract Law?
What is an example of an invalid consideration?
Illusory Promises: Promises that are overly vague or lack commitment may be regarded as illusory and constitute invalid considerations. Past Consideration: Something given or done in the past generally does not qualify as consideration because it lacks the element of a bargain.
What is an example of adequacy?
the fact of being enough or satisfactory for a particular purpose: The adequacy of public healthcare has been brought into question. There are concerns about the accuracy and adequacy of food labeling. The state is being sued over the adequacy of its education funding.
What is an example of insufficient consideration?
Example: A agrees to sell his car to B for $1. This is an example of inadequate consideration because the value of the car is much higher than $1. The transaction may be considered a gift or a fraud, and it may not be enforceable.
What is the rule of no consideration?
In India, a motion of no confidence can be introduced only in the Lok Sabha (the lower house of the Parliament of India) and after at least 50 Lok Sabha members support it, the Speaker may grant a leave and after considering the state of business in the House, allot a day or days or part of a day for the discussion of ...
What causes lack of consideration?
This could happen if the consideration offered becomes worthless or miniscule compared to the value of the contract, or if the party promising to furnish the consideration fails to do so.
What is an example of sufficient consideration?
Example: A company promises to pay an employee $50,000 per year in exchange for the employee's work. The employee's work is the consideration in this contract. If the company fails to pay the employee, the employee can take legal action to enforce the contract.
What is an example of failure of consideration?
For example, if you agree to pay someone $100 to mow your lawn, but they never show up to do the job, then there is a failure of consideration. The consideration promised (the lawn mowing) was not provided, so the contract is unenforceable.
What is the effect of inadequacy of consideration?
The explanation 2 of the section 25 of the Indian Contract Act, 1872 explicitly prescribes that mere inadequacy of consideration does not make a contract void but it can be considered by the courts in order to determine the free consent of the promisor.
What is an example of consideration need not to be adequate?
However, the courts may consider the inadequacy of consideration to determine whether the consent of the promisor was freely given. For example, if A agrees to sell a horse worth Rs. 1,000 for Rs. 10 and the consent was freely given, the contract is valid despite the inadequate consideration.
What is a synonym for inadequate consideration?
insensitivity. unkindness. rudeness. impoliteness. Synonyms for lack of consideration from Random House Roget's College Thesaurus, Revised and Updated Edition © 2000 Random House, Inc.
What is the meaning of inadequate situation?
: not adequate : not enough or good enough : insufficient.
What is an example of no consideration?
If a person performs their pre-existing legal duty, that would not be a valid consideration. For example, if a policeman enters into a contract to prevent crime, that would not be a valid contract. This is because the policeman is already under a legal obligation to do that as part of his job.
What are the golden rules of consideration?
The key principles of consideration in contract law are: 1) It must have value; 2) It must be negotiated and agreed upon by both parties; 3) It must be something that the law regards as having value; 4) It must be present or future, not past.
What does "adequate consideration" mean?
Adequate consideration means the reasonable value of goods or services received in exchange for transferred property that matches the reasonable value of the transferred property.
What is meant by inadequate consideration?
Inadequate consideration The term 'inadequate consideration' means any consideration which is less than the fair market value of the property. For example, if an individual sells a house worth Rs. 1 crore to his friend for Rs.
What is the legal definition of inadequate?
Definition and Citations:
Insufficient; disproportionate ; lacking in effectiveness or iu conformityto a prescribed standard or measure. Inability To Testify.
What is an example of insufficient process?
Insufficient process under Rule 12(b)(4) occurs when the form of the process, such as the content of the summons, is defective under FRCP 4. For example, the process is flawed if the summons or complaint fail to name the court in which the case is pending.
What is adequate and inadequate?
The Latin root of adequate means "equal to," so inadequate refers to things that aren't equal to what is expected or needed.
What is the rule of adequacy?
An adequacy decision is a formal decision made by the EU which recognises that another country, territory, sector or international organisation provides an equivalent level of protection for personal data as the EU does.
What are the criteria of adequacy examples?
The criteria of adequacy are testability (whether there is some way to determine if a theory is true), fruitfulness (the number of novel predictions made), scope (the amount of diverse phenomena ex- plained), simplicity (the number of assumptions made), and conservatism (how well a theory fits with existing knowledge).