Nominal Consideration at the Olympics
posted by Dave Hoffman
This is just bizarre:
“London Olympic organizers tell the Associated Press that the former Beatle [Paul McCartney] and other famous acts who participated basically “donated their time — receiving a mere pound ($1.57) — for their performances.” And that nominal fee was offered to make the Olympics contracts binding.”
If true, I take it that British law takes the position that nominal consideration can bind obligees, but that “false” nominal consideration can’t. Thus, the organizers had to both promise to pay McCartney a pound and actually pay it before the ex-Beatle was bound to perform.
To my mind, this is the least good resolution of the consideration problem possible. Look: either consideration should mean something – bargained for exchange motivating actual counter-promising – or parties should be free to dispose of the requirement of consideration entirely. In the United States, only Pennsylvania has taken that sensible latter position. The rest generally tend to require actual bargained for exchange, excepting only charitable subscriptions, which the Olympics are not. The Brits, who handed us this mess in the first instance, have apparently now embraced the unfortunate, mumbo-jumbo, hybrid, which reduces the sensible formality of consideration to a bit of a magical contract theatre. Does anyone think that that pound of consideration actually motivated McCartney’s promise to perform?