Validity of an agreement with free consent and lawful but inadequate consideration

An agreement is a legally enforceable contract between two or more parties who have come to a mutual understanding to perform or abstain from performing some act. For an agreement to be valid, it must have free consent, lawful consideration, and lawful object.

Free Consent: Free consent means that the parties to the agreement must have agreed to the terms of the contract without any coercion, undue influence, fraud, misrepresentation, or mistake.

Lawful Consideration: Consideration is something of value that is exchanged between the parties to the agreement. It can be in the form of money, goods, or services. For consideration to be lawful, it must not be illegal, immoral, or opposed to public policy.

Inadequate Consideration: Inadequate consideration means that the value of the consideration is less than what is expected or reasonable. For example, if someone agrees to sell a car worth Rs. 1,00,000 for Rs. 10,000, it is inadequate consideration.

Validity of an Agreement with Free Consent and Lawful but Inadequate Consideration:

An agreement with free consent and lawful but inadequate consideration is still a valid contract. The law does not require that the consideration be adequate, only that it be lawful. As long as the parties have agreed to the terms of the contract freely and without coercion, the contract is enforceable.

However, there are certain exceptions to this rule. If the inadequacy of consideration is so great that it shocks the conscience of the court, the court may declare the contract void on the grounds of fraud, undue influence, or unconscionability.

Conclusion:

In conclusion, an agreement made with free consent to which the consideration is lawful but inadequate is a valid contract. The law does not require that the consideration be adequate, only that it be lawful. However, if the inadequacy of consideration is so great that it shocks the conscience of the court, the court may declare the contract void on certain grounds.