Past consideration under MBE and NY rules: which statement is correct?

• A. MBE: good; NY: not good
• B. MBE: not good; NY: in signed writing, provable: good
• C. Both treat it as good
• D. Neither recognizes past consideration

Answer: (B)

The key idea is that consideration must be bargained-for and present at the time of the promise. A promise to pay for something that already happened is generally not valid because there’s no ongoing exchange happening when the promise is made.

Under the MBE rule, past consideration is not good. New York, however, recognizes a narrow exception: if there is a promise to pay for past services that is evidenced by a signed writing, that promise is enforceable because the writing provides proof of the obligation. So, a past promise to pay for services rendered in the past can be enforceable in New York when there’s a signed writing confirming the promise.

In short, the federal/MBE view rejects past consideration, while New York allows it if the promise to pay is in a signed writing and provable.