Understanding Contract Consideration

Selling your Rolex for 50 cents can be a legally binding contract. It sounds wild,

but it's because of a legal concept called "consideration." For a promise to become a real contract,

both sides must get something of value. Courts don't care if the deal is fair,

only that you both agreed to an exchange. It's called the "peppercorn rule." But this is why

many promises aren't contracts. A promise to do something you're already obligated

to do, like a lifeguard saving you, isn't new consideration. And a promise to

pay for a favor someone did last year? That’s past consideration, so it’s not enforceable.