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Past consideration in the law of contract.
The Constitution of a valid contract involves making a promise of a valuable item. This
valuable item is known as a consideration. In most cases, considerations are always settled in the
form of money transactions. On the other hand, luxurious goods or services can serve as a
consideration. Consideration is key for any contract to be legally binding (Savelyev, 2017).
Hence the presence of consideration is the starting point in the formulation of a valid contract.
Furthermore, individuals involved in contract formation tend to benefit from past consideration.
In other words, each party involved in the contract made a promise to honor the contract. In
circumstances where considerations are poorly defined, the contract can be term as null and void
(Allen, Kraakman & Subramanian, 2016). Legally binding agreements among parties can either
be unilateral or bilateral contracts. A mutual promise with considerations between two parties is
classified as a bilateral contact. While unilateral contacts are where one party's performance
determines whether the first party will make a promise or not. An example of a unilateral
contract is when party A vows to pay party B $ 40.00, and in exchange, party B will service
party A's car.
Nevertheless, parties involved in a bilateral contract, are bound by the promises they have
made whereas, unilateral contractual agreement binds the individual who first made the promise
(Allen, Kraakman & Subramanian, 2016). The other party must undertake the action promised in
a unilateral contract to provide consideration. For consider...
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