Promise Enforceability Analysis: Contract Law - INTI College Sabah

This essay examines the enforceability of a promise between Diana and Tony, focusing on whether the promises are legally binding based on the principle of consideration in contract law. It begins by defining consideration according to Currie v Misa and Section 2(d) of the Contract Act 1950, emphasizing that a valid contract requires offer, acceptance, and consideration. The analysis explores whether Tony's promise of a pearl necklace to Diana, contingent on him receiving a bonus and Diana hosting a birthday party for his mother, constitutes valid consideration. The essay applies rules of consideration, such as the need for sufficiency but not adequacy and the validity of past consideration, referencing cases like Phang Swee Kim v Beh I Hock and Kepong Prospecting Ltd & Ors v Schmidt. The conclusion asserts that the promise meets the legal requirements for validity, making it an enforceable contract that Diana can legally pursue.

Enforceability of promise between Diana and Tony
Issue
Whether the promises made between Diana and Tony are enforceable.
Rule
A promise is only enforceable if there is consideration made by the promisee.
Analysis
It is trite law that the bare minimum for validity of a contract is threefold, namely – offer,
acceptance and consideration. Any contract that falls short any among the three essentials of a
valid contract is automatically an invalid contract and must be considered as such. The promise
between Diana and Tony touches on consideration. This response therefore focuses on the
validity consideration.
What is consideration?
In Currie v Misa, the Court defined consideration to be either a loss or a benefit on either
the promisor or promisee to the contract. According to section 2 (d) of Contract Act 1950,
consideration is provided to mean when either a promisor or promisee does something or
abstains from doing something either in past, present or in the future. Accordingly, consideration
flows from both parties, in keeping with the spirit of creation of obligations and rights from both
parties
What is the consequence of lack of consideration?

For a contract to be valid; there must be consideration. Section 26 of Contract Act 1950
provides in clear terms that a contract without consideration is void, and as such lacks legal
force.
Was there consideration in the promise between Diana and Tony?
According to the facts at hand, Tony promised Diana a pearl necklace set subject to two
preconditions; namely - if he received bonus from his boss, and if Diana planned and hosted a
big birthday party for his mother. All the preconditions were met. Applying these facts to the
definition of a consideration and principles of the law discussed earlier own, a number of factors
for analysis are disclosed.
On the one hand, Tony made a promise subject to conditions which were accepted by Diana. On
the face value; Tony promises to deliver a pearl necklace set which is a detriment or forbearance
or loss on his part; his benefit is in the form of planning and hosting a big birthday party for his
mother. On the other hand, Diana’s forbearance or loss is the form of planning and hosting a
birthday party to Tony’s mother; her right or interest or benefit is in the form of a pearl necklace.
It can therefore be concluded based on this front alone that there was consideration.
Were the rules of consideration complied with?
Rules of consideration are: it need not be adequate; past consideration is good
consideration; natural love and affection is good consideration; part payment may discharge
promisor from obligations; and consideration need not move from the promise. Two rules are for
application in this case. First, consideration need not be adequate. According to the Court of
Appeal in Phang Swee Kim v Beh I Hock, was of the considered view that consideration must

only be sufficient and not adequate. The facts between Diana and Tony point to satisfaction of
the requirement as to adequacy or sufficiency of consideration.
Second and lastly, past consideration is good consideration. Section 26 of Contract Act 1950
provides that a promise by the promisor to compensate the promisee for an act which has already
been done is good consideration. In Kepong Prospecting Ltd & Ors v Schmidt, the court opined
that a past act constitutes a valid consideration and binds the promisor. Tony cannot therefore
claim that performance by Diana of her obligation constitutes a past consideration that is not
valid in law.
Conclusion
In conclusion, the promise between Diana and Tony has met the legal requirement for
validity. Undoubtedly therefore, the promise constitutes a valid contract that is enforceable in
law and attracts legal consequences. Therefore, Diana can enforce the promise made by between
her and Tony.

References
Peel, E., & Treitel, G. H. (2007). The law of contract (pp. 1-2). London: Sweet & Maxwell.
Currie v Misa (1874) LR 10 Ex 153.
Phang Swee Kim v Beh I Hock, [1964] MLJ 383
Kepong Prospecting Ltd & Ors v Schmidt [1968] AC 810