This Misa[3], Lush J highlighted that “…some right, interest,

This question concerns the issue of
consideration and economic duress; is Brendan liable to pay additional charges
to Sentry Security and the police? In order for an agreement to be enforceable
it must have consideration. Dunlop v Selfridge1
defined consideration as ‘…the price
for which the promise of the other is bought…’ Stone
stated that “promises do not have to take any particular form or put in
writing, but will be enforceable if there is mutuality in the agreement – both
parties bring something to it.”2
In Currie v Misa3, Lush
J highlighted that “…some right,
interest, profit or benefit accruing to one party, or some forbearance,
detriment, loss or responsibility given, suffered or undertaken by the other.” But most of all, consideration must be legally
sufficient, must move from the promise, must not be past and need not be
economically adequate.

 

The
first issue is whether there is consideration between Sentry Security and Brendan. Consideration must be sufficient
and therefore means something which is
of some value in the eye of the law4. In
Stilk v Myrick5,
it was held that the claimants
were already contractually bound to do extra work, and subsequently performing the extra work could not count as fresh consideration. If claimant had been legally entitled to the extra money, this could pave
the way for blackmail, extortion and duress, whereby people could refuse to
work unless they are paid in excess of what their contract provides. In turn, the question arises to whether Sentry Security
were bound by an existing duty under an enforceable contract and if so there
would not be sufficient consideration. Brendan could argue that he was giving
Shaun £3,000 a month to ‘provide adequate security arrangements for the site’
and in turn he expects Shaun to provide adequate security no matter the
situation for the monthly fee. If the courts are to take this view, it is
likely Brendan would not be liable to pay the additional fees to Shaun at
Sentry Security.

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This can
be contrasted with Hartley
v Ponsonby6,
where the claimants were entitled to
the extra payment promised on the grounds that they had gone beyond their
existing contractual duty or that the voyage had become too dangerous making
the original contract void, leaving the crew free to negotiate a new contract, and
therefore counting as fresh consideration. A case which could abandon the principle set out in
Stilk v Myrick7
is Williams v Roffey8
where as a result of his promise to pay extra money, the defendant had obtained
certain practical benefits, therefore, there was consideration for the
defendant’s promise to pay more. The agreement made between Brendan and Shaun was an alteration promise, where
parties in an existing contract seek to alter the terms of the contract already
in existence, and this situation it was a promise to pay more. As the increase
in protestors was not anticipated when the original deal was made, Shaun could
argue that it would not be reasonable to expect him to be able to provide sufficient
security without an increase in fees as it would mean Shaun would be going
beyond their existing contractual duty, as in Hartley v Ponsonby9.
Whilst also bearing in mind that the rate was already reduced due to Shaun and
Brendan’s friendship. Therefore, fresh consideration was made when a need for extra security
was established by Brendan. If
the courts were to take this view, it is likely that Brendan would be liable to
pay additional charges to Shaun at Sentry Security.

 

Although
consideration must be sufficient, but need not be
adequate, it is not the court’s duty to assess the value of each party’s
contribution to a bargain. Once something of value can be shown, the court
makes no inquiry into whether the thing offered is a genuine equivalent of the
promise made10.
In Chappell & Co. v Nestle Co.
Ltd11
1960 the wrappers were part of the consideration
(received by the defendant from customers) even though they were of no further
value once received by the defendant. As Lord Somervell highlighted in the
case, “A contracting party can stipulate for whatever consideration he chooses.
A peppercorn does not cease to be good consideration if it is established that
the promisee does not like pepper and will throw away the corn”12

 

The
second issue is whether Brendan is under economic duress when agreeing to pay
additional fees from Shaun. If economic duress can be established
it will allow the contract between the two parties be voidable due to economic
pressure being asserted by Shaun. Economic duress arises where one party uses his
superior economic power in an ‘illegitimate’ way so as to coerce the other
contracting party to agree to a particular set of terms.13 As
Chitty Contracts stated, ‘A person who has entered into a contract
under duress, may other affirm or avoid such contract after the duress has
ceased…’14
In Atlas Express v Kafco15, it was held that Kafco
were not bound by the new terms as economic duress had disregarded the new
agreement and there was no consideration for it. Tucker J found that the
defendant’s apparent consent to the agreement was induced by pressure which was
illegitimate and he found that it was not approbated. In Pao On v Lau Yiu Long16,
Lord Scarman held that in order for something to amount to economic duress, ‘it must be shown that the
payment made or the contract entered into was not a voluntary act.’ Due
to the fact that Brendan reluctantly agreed to the increased fees to £4500, he
may not be bound on the ground of ratification according to Chitty. As
alongside this, Brendan did not voluntarily cease under economic duress and it
could be argued that Shaun used economic pressure in order to ensure Brenden
would agree to the increased fees by threatening to withdraw all security from
his factory at a time when there was a high level of danger to his factory and
workers. If
the courts were to take this view, it is likely that Brendan would not be
liable to pay the additional charges to Shaun.

 

The
third issue is whether there is consideration between the police and Brendan. Where
the promisee is doing something that is a duty imposed by some public obligation,
there is a reluctance to allow this to be used as a basis of a contract.17 In Collins v Godfrey18
it was held that the promise to give the sum of money to appear as witness was unenforceable,
because there was no consideration for it. This seems to have been on the basis
that the duty to attend was ‘a duty imposed by law’19,
as the C was legally bound to attend court anyway. Accordingly, Brenden could
argue that the police, as a public body, are already bound to attend a crime
scene and assist when they are needed, without additional fees, and therefore
there was no consideration for the promise. If the courts were
to take this view, it is likely that Brendan would not be liable to pay the
additional charges to the police.

 

This can be contrasted with Glasbrook Bros v
Glamorgan20 where
it was held in the House of Lords that the
police had gone beyond their existing public duty. In doing so they provided
good consideration. Therefore, the contract was enforceable and the police
could recover the amount charged. As a result of the
decision made in Glasbrook Bros v Glamorgan21, the Chief Constable could argue that he and his police force went out
of their way to station additional police at the factory as even though he had insisted
it was unnecessary, Brendan still requested that ‘police officers are permanently
stationed’ whilst agreeing to ‘pay £1,000 per day for the officers to attend.’ This
shows that even though the police are public body and are already imposed with
a duty of law, Brenden’s promise to provide additional charges in order for the
public body to provide extra duty than is necessary is enforceable. If the
courts were to take this view, it is likely that Brendan will be liable to pay
the additional charges to the police.

 

In conclusion when considering whether Brendan is liable
to pay the charges to Sentry Security based on sufficient consideration, it would
be likely that Brenden would be held liable as Sentry Security went beyond
their existing contractual duty. However, when economic duress comes into the picture
it is likely that Brendan would not be liable to pay the charges. This is
based on the presumption that Brendan had no
other option but to increase the fees to protect his factory from Shaun’s
threat to remove his staff from the site, causing illegitimate pressure. So, even
though Brendan may have been liable due to sufficient consideration, economic
duress occurred which disregards the sufficient consideration and therefore Brenden
would not be liable to pay the additional charges to Sentry Security.

 

When considering
whether Brendan is liable to pay the additional chargers to the police

1 Dunlop Pneumatic Tyre Co Ltd V Selfridge Ltd 1915
AC 847

2 Stone, The Modern Law of Contract (12th ed, Routledge 2017) pg.86

3 Currie v Misa (1874) LR 10 Ex 153

4 Thomas v Thomas (1842) 2 QB 851

5 Stilk
v Myrick 1809 EWHC KB J58

6 Hartley
v Ponsonby 1857 7 EB 872

7 Stilk
v Myrick 1809 EWHC KB J58

8 Williams
v Roffey Bros 1990 2 WLR 1153

9 Ibid
n.7

10 Poole, Textbook on Contract Law (13th ed, OUP, Oxford 2016)
pg.127

11 Chappell & Co. v
Nestle Co. Ltd 1960 AC 87

12 Somervell J, Chappell & Co. v
Nestle Co. Ltd 1960 AC 87

13 Ramjohn, Text, Cases and Materials on Equity and Trusts (4th
ed, Routledge 2008) pg.671

14 Chitty, Chitty on Contracts (24th ed, 1977) pg.207

15 Atlas Express v Kafco 1989 1 All ER 641

16 Pao On v Lau Yiu Long 1980 AC 614

17 Ibid n.2 pg.104

18 Collins
v Godefrey (1831) 1 B & Ad
950

19 Ibid n.2 pg.104

20 Glasbrook
Bros v Glamorgan County Council 1925
AC 270

21 Ibid
n.20