Adequate Consideration Law and Legal Definition

Consideration is an important element of a contract. Adequate consideration refers to a price which is equal in value for an act or a thing for which it is given. The price can be in the form of money, property, an act, and promise to do an act or not to do an act. Inadequate consideration is not void; however, it can make a contract unenforceable either by itself or due to procedural defects in bargaining. For example, If A promises B, A’s house worth $25,000 for $5, then this would be inadequate consideration.