Lawful Consideration in Agreement: Understanding the Basics

When two parties enter into an agreement or contract, the consideration is a fundamental element of the contract that defines the value that each party will provide to the other. In order to make the consideration legally valid, it must meet certain requirements, including being lawful.

In this article, we will explore the basics of lawful consideration in agreement so that you can better understand its importance in contract law.

What is Consideration?

Consideration is a vital concept in contract law that refers to what each party will give and receive as part of the agreement. This can be anything of value, such as money, goods, services, or promises. In other words, consideration provides the bargaining power to enter into an agreement, and without it, the contract is not binding.

In order for an agreement to be legally binding, there must be an exchange of consideration between the parties. This means that both parties must receive something of value in exchange for what they are giving. The consideration can be monetary or non-monetary, such as a promise to do something in the future.

What is Lawful Consideration?

In order for an agreement to be legally valid, the consideration must be lawful. This means that the consideration provided by both parties must not be illegal, against public policy, or immoral.

For example, consider a contract between two parties where one party agrees to sell illegal drugs to the other. Since the consideration is illegal, the contract is not legally valid. Similarly, a contract where one party agrees to sell their vote in a political election would also be against public policy and therefore unlawful.

On the other hand, an agreement where one party agrees to pay a contractor to remodel their house would be lawful. Both parties are providing something of value, and the agreement does not violate any laws or public policies.

Why is Lawful Consideration Important?

Lawful consideration is essential in contract law because it ensures that the agreement is fair and just for both parties. It also helps to prevent illegal activities and immoral behavior, which can have negative consequences for both parties and society as a whole.

If the consideration in a contract is illegal or against public policy, the contract is not enforceable in court. This means that if one party breaches the agreement, the other party cannot seek legal remedies for the breach.

In summary, lawful consideration in agreement is an essential part of contract law that ensures that agreements are fair, just, and legal. When entering into an agreement, it is important to carefully consider the consideration being provided and ensure that it is lawful. This will help to protect both parties and ensure that they can enforce the agreement if necessary.