Question

Which of the following is sufficient and valid consideration: Question 28 options: a.Performing what one is already obligated to do. b.Refraining from doing what one has no right to do. c.Past performance. d.Accepting a secured note in discharge of an unsecured note for a greater amount..com.com

Answer 1

d. Accepting a secured note in discharge of an unsecured note for a greater amount

Step-by-step explanation:

Consideration refers to something payable for performance or non performance of an act as per a valid agreement. In simple terms, it refers to an exchange of value between parties. The essential features of consideration being,

• An obligation to perform an act which one was under no obligation to perform before.
• Agreeing not to perform a legal act which earlier one was under no obligation to not perform.
• Past performance does not amount to consideration since such act was already performed in the past without any existence of a contractual obligation.

Consideration does not require that both parties gain an equal value. Thus, accepting a secured note in discharge of an unsecured note for a greater amount would constitute a valid consideration.