Practical benefit: an English anomaly or a growing force in contract law?

Abstract

In Williams v. Roffey Bros & Nicholls (Contractors) Ltd. [1991] 1 QB 1 the English Court of Appeal famously invented the "practical benefit" principle. This principle makes it far simpler for parties to satisfy the consideration requirement when modifying a contract. This article reviews the ensuing case law around the common law world addressing the practical benefit principle, with a focus upon its status within the Australian law of contract, and simultaneously identifies the issues the principle attracts. It will be shown how the principle has been actively applied but often misused. The few domestic authorities discussing practical benefit, including the New South Wales Supreme Court’s qualified acceptance of the principle and the High Court’s cursory mention of the notion, will be considered before a tentative conclusion on the status of "practical benefit" in this jurisdiction, and its future prospects, is given.