The Balance between Contract Freedom and Equal Exchange —On“Consideration Need Not Be Adequate”in Common Law

Consideration is the essential element of traditional common law contracts. The rule of “consideration must be sufficient though not necessarily adequate” is the principal rule of determining whether the sufficient consideration exists. This rule originated in the judicial practice during the medieval times of England, and developed as the essential rule of classical contract laws. Nominal consideration and recital consideration are the special circumstances. The rule has reflected the spirit of contract freedom. It has helped to improve transactions. It also contains the characteristics of common law tradition. Some contemporary scholars have generalized the essence of contractual relationship as “collaboration”, which is the recent defense of the rule.