D had a building contract and subcontracted to P. So as to avoid a late-completion penalty D offered P extra money per flat. It then failed to pay him the extra money. CA said that there WAS a contract and D had to pay. It held that where one party paid additional money to another to complete an existing payment so as to gain a benefit or avoid a detriment, the advantage secured by the promise to make the additional payment was capable of constituting consideration, provided it was not obtained by economic duress or fraud. In this case the commercial benefit of completing the work on time was considerable and definitely consideration.
Glidewell LJ: distinguishes this from Stilk v Myrick by saying that that case was more about public policy and fears about lack of consideration (i.e. he adopts the “Espinasse report” approach to the case). Hence in this ruling, the CA pointed out that there had to be some extra benefit gained/loss avoided in order for there to be consideration AND there had to be no fraud/duress. Russel LJ also said that where a benefit is adduced, there is no reason why it should not be regarded as consideration.
The outcome is right since it would make no sense for the courts to curtail the way in which employers can pay and motivate employers. However the distinction with Stilk is unconvincing since they are materially the same circumstance. Under the test in this case, a modern court trying a Stilk type case would probably find for the sailor!