Q.
What case can you quote for "Past Consideration is Good Consideration"?
A.
Similar question was asked in 2014/3 Q1 - validity of past consideration.
Under Section 26 (b) of the Contract Act, 1950 below:
(b) or is a promise to compensate for something done;
it is a promise to compensate, wholly or part, a person who has already voluntarily done something for the promisor, or something which the promisor was legally compellable to do,
In Kepong Prospecting Ltd v Schmidt (1968), this was the precedent arrived.
Schmidt, a consulting engineer has assisted in obtaining a permit for iron ore in the State of Johore. He also helped in the subsequent formation of the Company, Kepong Prospecting Ltd. After the Company was formed, an agreement was entered into between them under which the Company undertook to pay him one percent of the value of all iron ore sold from the mining land. This was in consideration of the services rendered after incorporation but before the agreement.
Held: The Court held that this was sufficient in law to constitute valid consideration even though they were clearly past.
Therefore Schmidt was entitled to be paid for his services even though it was clearly past.
A.Vijaychandran. 2008. The Law on Consideration - Q&A. Available at,