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Consideration & Misrepresentation Brief Notes

By : WY&DL

Combe v Combe (1951)

1) A married couple was getting divorced

2) The husband promised to pay the his ex wife, $100/year

3) Wife didn't file for a maintenance order and relied on his promise

4) Husband didn't keep his promise

5) After 6 years, the wife sued for arrears (debt)



Plaintiff : Sued and said she provided consideration for her husband's promise by not filing a court order but courts held she did not provide consideration.
CA Held : Promise unenforceable.
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A) Husband did not have to pay because
            1) He did not ask her to file a maintenance order
            2) He did not intend to forbear her from filing a maintenance order.
            3) Promissory Estoppel can only be used as a shield, not a sword.
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Q : Why did the courts refused to imply that the husband asked the wife to file a maintenance order ?
Because the 'justice of the case' did not require that it should be implied.
1) The wife had delayed her claim for 6 years
2) The wife had a higher income than her husband.

Note:    Forbearing to do an act would usually be enough to be consideration.

            In this case, forbearance was not sufficient consideration.



Contrast with Alliance Bank v Broom (1864)

Spring v Guardian Assurance

Q : Can you be held liable for economic loss suffered because of your reference?

(ie, if you give bad statement (reference) about an employee of yours, and because of that, he isn't hired by other companies, can you be held liable)

- D made a statement that implied the CL is of no integrity and a dishonest person.




HELD : D owes a duty of care to his employee because of his negligent misstatement. 

Dutton v Bognor Regis UDC

Pure Economic Loss

Usually, courts would allow claims on consequential economic loss rather than pure economic loss.


- Mrs Dutton, the claimant suffered a financial loss because of the 'defect' in the foundations of the property due to the negligent inspections carried out by the inspector of Bognor Regis UDC.


- After appealing, Mrs Dutton won the case because: 
1) There was a threat of injury to health & safety


Q: If the defective property was merely of low quality, and not dangerous to health, would there be liablity?
No

Ellie Goulding - Lights

Thomas v Thomas [1842]

Consideration only need to be sufficient, it does not need to be adequate (enough)

The story of John Thomas

On the day of John Thomas's death, he told the witnesses that he wanted his wife to have one of his house for life, although it is not written in his will.


After his death, his executors gave one of the houses to his wife, if and only if she paid a rent of 1 pound per year and kept the house in good condition.


The wife paid the rent and kept the house in good condition.
Later, the executor tried to dispossess the house, but they failed.





Held : Contract was enforceable, not because it was the death wish of the husband BUT, merely because of the fact that the wife had paid rent.




Paying the rent shows consideration, therefore the contract was binding and the executors failed.