THE DOCTRINE OF CONSIDERATION IN PAKISTANI CONTRACT LAW: REFORM OR RETAIN?

Abstract

The doctrine of consideration, central to the classical model of contract law inherited from English jurisprudence, continues to operate as a foundational requirement for the enforceability of agreements in Pakistan. Despite the country’s evolving socio-economic and legal landscape, the doctrine remains largely unreformed, preserved in its traditional form through judicial continuity and legislative inertia. This paper explores whether such doctrinal stability is justified or whether reform is necessary to accommodate the realities of modern contracting practices. It begins by tracing the historical roots of the doctrine, from its medieval English origins to its transplantation into the subcontinent through colonial legal institutions. While the concept of consideration was intended to serve as a marker of contractual seriousness and reciprocity, its continued application has, in many cases, led to rigid formalism, often at the expense of substantive justice.

An examination of Pakistani case law reveals that the courts have largely adhered to a narrow and formalist interpretation of consideration, emphasizing the presence of a bargained-for exchange rather than engaging in substantive inquiry into fairness, intention, or reliance. This judicial approach contrasts with the more flexible trends emerging in other common law jurisdictions, particularly in England, where courts have gradually moved toward recognizing doctrines such as promissory estoppel and aim to create legal relations as partial substitutes or complements to consideration. The Indian experience, while formally retaining the doctrine, shows a more pragmatic adaptation, wherein courts have occasionally prioritized equitable concerns over rigid adherence to form.

The paper presents a comparative framework to evaluate whether Pakistani contract law might benefit from similar developments. It assesses arguments for retaining the doctrine, including its role in preserving legal certainty, deterring frivolous claims, and providing a clear threshold for contractual enforceability. At the same time, it scrutinizes the criticisms leveled against the doctrine, including its outdated origins, its failure to reflect the complexity of modern commercial transactions, and its potential to frustrate legitimate expectations where reliance or intention is otherwise clear. Particularly in contexts involving standard form contracts, employment relationships, and informal agreements, the doctrine may operate more as a barrier to justice than as a guarantor of legal integrity.

Drawing upon both doctrinal analysis and comparative jurisprudence, the paper ultimately argues that Pakistan's continued adherence to an unmodified doctrine of consideration is increasingly difficult to justify. While wholesale abolition may be neither feasible nor desirable, the case for selective reform both judicial and legislative is compelling. Judicially, a more purposive and equitable interpretive stance is urged, one that gives weight to the realities of contracting behavior and the rational expectations of the parties. Legislatively, the incorporation of statutory exceptions or supplementary doctrines such as reliance-based enforcement or recognition of moral obligations in certain circumstances could modernize the law without undermining its structural coherence.

In conclusion, the paper advocates a calibrated reform strategy aimed at aligning Pakistani contract law with both international developments and the pressing needs of domestic commercial and social life. By reimagining the doctrine of consideration in a manner responsive to contemporary realities, Pakistan can ensure that its contract law remains both principled and just.