Something with monetary value, voluntarily exchanged for an act, benefit, forbearance, interest, promise, right, or goods or services. In banking, the loan-amount is a consideration, in exchange for the borrower's promise to repay the principal and to pay interest and other charges. In insurance, the insurance company's offer to make a loss good is a consideration in exchange for payment of premium. Essential element of all enforceable commercial-contracts, it does not have to be 'adequate' or equal in value to the exchanged item but must be legal (not in violation of any law).
Any commercial contract without a valid (valuable and legal) consideration is invalid and is called 'nudum pactum' (Latin for, naked contract) governed by the legal maxim 'ex nudo pacto non oritur actio' (Latin for, a right of action does not arise from a naked contract). See also good consideration, and valuable consideration.

Use consideration in a sentence

  • When we pay our insurance payments regularly we expect to receive fair consideration promptly in the event we need it.

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  • Once he turned professional, Vincent promised himself not to do any design work -- even as a favor for a friend -- without some sort of monetary consideration.

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  • When a jury is deliberating about a case it is very important that they take all the facts into consideration to get the correct judgement.

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