Question

Legal Principle: When, at the desire of the promisor, the promisee or, any other person has done or abstained from doing, or does or abstains from doing, or promises to do or to abstain from doing, or promises to do or to abstain from doing, something, such act or abstinence or promise, is called a consideration for the promise.

Factual Situation: A lawyer gave up his practice and served as manager of a land owner at the latter's request in lieu of which the land owner subsequently promised a pension.
Issue: What is the nature of the contract ?

• A. There was a valid contract as there was a good past consideration.
• B. Such vague promises do not result into contract.
• C. The contract is voidable at the option of the land owner.
• D. None of these.

Answer 1

Answer: (A)

There was a valid contract as there was a good past consideration.

• Section 10 of the Indian Contract Act, 1872 states that all agreements which are made on free consent of the parties competent to contract, with a lawful object and lawful consideration, and not expressly declared as per the Act, are valid contracts.
  
• In the present case, there is clear free consent to fulfill the promises. Parties are competent to contract. The object and considerations is not unlawful as it is neither forbidden by law (violation of provisions of enactments), fraudulent (intended to fool the other party), injurious to any of the parties to the contract, immoral, against public policy nor if allowed would defeat the provisions of law as per Section 23 of the Act. Past consideration is allowed as per Section 25 of the Act. So, it is a valid contract.