What is inadequacy of consideration in a contract?

Inadequacy of consideration Adequacy of the consideration means that the consideration which is paid is equal in value to the value for which it is paid. inadequate consideration is not void but it renders the contract unenforceable because of the improper bargaining or by itself.

What is inadequacy consideration?

Inadequacy of consideration is, as the term implies, a consideration not adequate or equal in value to the thing conveyed.

Is a contract void for inadequate consideration?

In a written contract, even though inadequate consideration is not void, it can make a contract unenforceable. Some contracts do not necessarily require considerations in order to be enforceable.

What is adequate consideration in a contract?

What Does “Adequate Consideration” Mean? In order for a contract to be enforceable in a court of law, the consideration that is exchanged must be deemed “adequate”. This means that the mutual exchange must involve a fair price in comparison to the promise that is made in exchange for it.

What does inadequacy of consideration mean in equity?

In equity, inadequacy of consideration, if such as to be evidence of fraud, is ground for refusing specific performance; and inadequacy of consideration is regarded as corroborative evidence in suits for relief from contracts on the ground of fraud and undue influence.

What does the adequacy of consideration mean in a contract?

Adequacy of consideration means that for a lawful agreement to be made, the offeree must give a price that is equal measure to the value given by the offeror.3 min read

What happens if there is insufficient consideration in a contract?

Studying US contract law you will probably learn that consideration must be “sufficient. ” If there is insufficient consideration a court may say there is no contract. But this does not mean that there must be “enough” consideration.

When is a consideration deemed inadequate by the court?

If a consideration involves a worthless item or a misleading promise, it is deemed inadequate. The amount or performance given in a consideration must be of a value recognizable by the court. A consideration that violates a public policy, such as prostitution, is deemed inadequate. Adequate Consideration Vs. Sufficient Consideration