Williams V. Roffey Brothers Case Study

Question One

Issue:
Whether Bob had any consideration for the extra $2,000 promised by Fred?

Law:
If the promisee is simply performing a duty which they have contractually obliged to perform under the original contract with the promisor, this cannot be a consideration for a fresh promise. This rule was established in the Stilk v. Myrick (1809) and the Cook Islands Shipping Ltd v. Colson Builders Ltd (1975) cases.

Following Williams v. Roffey Brothers (1990) case, an existing contractual obligation may still be held to create real consideration when the promisor obtains a real practical benefit. The mutual exchange of benefits is a consideration only when the promisee did not use improper pressure to force the promise of extra payment

Roffey Brothers (1990) case, the Court decided that an existing contract obligation can be held as a fresh promise if there is a mutual exchange of benefits. In the present problem, Bob’s delay would cause Fred to miss out the big agricultural market and the opportunity to sell his crops and earn money. In the same way as the Roffey Brothers, Fred obtained a real benefit in return for the promise to pay the extra $2,000. Hence, there is a mutual exchange of benefits. Fred’s benefit is capable of being a consideration for the fresh promise, so the new promise will be legally binding.

In addition to the ratio above, improper pressure cannot be used to create the promise of extra money . Bob had put improper pressure on Fred. He had threatened Fred that he will not deliver the goods unless the $2,000 is paid. For this reason, the decision in Williams v. Roffey Brothers (1990) cannot be applied to this case since there is evidence of improper pressure on the part of Bob. As a result, Bob’s use of improper pressure on Fred has overridden the mutual exchange of benefits and the outcome of this case will not be the same as the decision made in Williams v. Roffey Brothers (1990).

Conclusion:
There was no valid consideration for the fresh promise and hence the promise is not legally binding. As such, Fred does not have to pay Bob the extra $2,000.

Question Two