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Failure of consideration is a technical legal term referring to situations in which one person confers a benefit upon another upon some condition or basis ("consideration") which fails to materialise or subsist. It is also referred to as "failure of basis". [1] It is an 'unjust factor' for the purposes of the law of unjust enrichment. Where ...
Consideration may move from the promisee or any other person. Under Indian law, consideration may be from the promisee of any other person i.e., even a stranger. This means that as long as there is consideration for the promisee, it is immaterial who has furnished it. Consideration must be an act, abstinence or forbearance or a returned promise.
Failure of consideration typically arises where a contract is "ineffective". [44] This is not a term of art, but rather a useful tool for exposition. [45] A contract may be ineffective for a number of reasons. Failure of consideration may arise: Where a contract is discharged for breach or repudiation by the claimant or defendant;
Total failure of consideration or illegal consideration by the party giving a guarantee will prevent its being enforced. Though in all countries the mutual assent of two or more parties is essential to the formation of any contract, [45] a consideration is not everywhere regarded as a necessary element. [46]
An action for money had and received to the plaintiff's use is the name for a common law claim derived from the form of action known as indebitatus assumpsit.The action enabled one person to recover money which has been received by another: for example, where a plaintiff paid money to the defendant while labouring under a mistake of fact or where there was a total failure of consideration.
On the "absence of basis" approach, B's enrichment has no legitimate explanatory basis because the contract was void. On the "unjust factor" approach, there has been a total failure of consideration – that is, A has received no part of the bargained-for counter-performance; restitution follows automatically from the fact of invalidity.
An outcome failure is a failure to obtain a good or service at all; a process failure is a failure to receive the good or service in an appropriate or preferable way. [6] Thus, a person who is only interested in the final outcome of an activity would consider it to be an outcome failure if the core issue has not been resolved or a core need is ...
Consideration is an English common law concept within the law of contract, and is a necessity for simple contracts (but not for special contracts by deed).