Consideration is one of the traditional requirements of an enforceable contract. The doctrine asks whether the promise was made as part of an exchange: did the promisor seek something in return, and was that performance or promise given in exchange for the commitment?
The Problem With Past Consideration
A detriment suffered before the promise is made ordinarily cannot be consideration for that later promise because it was not induced by the promise. The act was already complete. The promisor’s later statement may reflect gratitude, moral obligation, or a desire to reward the earlier conduct, but it did not cause the conduct to occur.
Bargained-For Exchange
The key concept is bargaining, not whether one party experienced hardship. If A performs a service voluntarily on Monday and B unexpectedly promises on Friday to pay A $1,000 because of that service, A’s Monday performance was not given in exchange for B’s Friday promise. There was no bargain at the time the performance occurred.
Why the Rule Matters
Without the past-consideration rule, casual promises of gratitude could become contractual obligations even though the parties never negotiated an exchange. The doctrine helps distinguish a contract from a gift promise or moral commitment.
Exceptions and Related Doctrines
Contract law contains doctrines that can sometimes enforce promises despite the absence of ordinary consideration, including promissory estoppel in appropriate circumstances and certain promises connected to prior obligations or benefits. The details vary, and these doctrines should not be treated as automatic exceptions to the basic rule.
A Practical Test
Ask when the alleged consideration occurred and why it occurred. If the performance was requested as the price of the promise, it may be consideration. If the performance was already complete before the promise existed, it is generally past consideration and cannot, by itself, supply the bargained-for exchange required for a conventional contract.
The doctrine is therefore less about the value of the prior act than about timing and causation. Consideration must be part of the exchange that produced the promise.