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Last month, David gave his nephew, John, his old car as a gift because John was struggling financially. A week later, John won £250,000 in the lottery and promised to pay David £5000 from his winnings as a thank you for the car. However, since making the promise, John has not contacted David or given him any money.
Can David enforce John's promise?
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David cannot enforce John's promise because his consideration, giving the car to John, is considered "past consideration". According to contract law, for a promise to be enforceable, there must be consideration provided by both parties at the time of the agreement or in the future, but not in the past. Since the car was given as a gift before John promised to pay £5000, it does not constitute valid consideration. The leading case, Roscorla v Thomas (1842) 3 QB 234, established that past consideration, something given or promised before the promise is made, is not valid consideration and therefore cannot support a contract.
Key Point: Consideration must be something of value in the present or future, provided at the time of the agreement, and cannot be based on past actions. This principle ensures that all parties to a contract are entering into the agreement with a mutual and current exchange of value, preventing any enforcement of promises made after the fact based on previous acts.
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