Written by attorneys · grounded in primary & secondary sources — see below
2 senses
1
Consideration that has been delivered or provided in exchange for a promise or obligation. The phrase commonly appears in promissory notes and bills of exchange to confirm the instrument rests on valid consideration.
2
The benefit obtained by the burdened estate from services or facilities supplied under a covenant. Courts use the measure to decide whether a payment obligation has become excessive.
Sense 1
1
Sense 1
Consideration that has been delivered or provided in exchange for a promise or obligation. The phrase commonly appears in promissory notes and bills of exchange to confirm the instrument rests on valid consideration.
Sources & Authorities· 1 source
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Dictionaries
Examples
Sense 2
2
Sense 2
The benefit obtained by the burdened estate from services or facilities supplied under a covenant. Courts use the measure to decide whether a payment obligation has become excessive.
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Each sense below has its own examples, sources, and questions.
3
Eminent Domain Compensation Dispute
The United States takes temporary use of warehouse space owned by Valdez Steel for wartime storage. Valdez Steel claims compensation measured by the full rental value of the space during the taking period. The government argues that compensation should reflect only the long-term rental rate of bare space. The court rejects the government's position because limiting recovery to bare-space rent would fictionalize just compensation rather than providing a true substitute for the property taken.
United States v. General Motors Corp.323 U.S. 373, 378 (1945)
Third-Party Beneficiary Enforcement
Valerie Viera borrows money from Vanessa Vinson and promises to repay the loan to Violet Vidal. In exchange for value received from Viera, Vinson's note states that the funds will be paid directly to Vidal. When Viera defaults, Vidal sues Vinson on the promise. The court holds that Vidal may enforce the obligation because the promise was made for value received and for Vidal's benefit, establishing her rights as a third-party beneficiary.
Lawrence v. Fox20 N.Y. 268 (1859)
Act of Production Immunity Analysis
Vasquez Imports receives a subpoena requiring production of documents that would authenticate their contents. The company asserts that compliance would constitute compelled testimony. The government offers immunity limited to the act of production itself. The court examines whether the immunity adequately protects against use of the compelled act, ensuring that the government cannot rely on the authentication implicit in the production to establish the documents' genuineness at trial.
United States v. Hubbell530 U.S. 27, 35–36 (2000)
Frequently Asked2
How does the phrase 'value received' function in promissory notes and bills of exchange?+
The phrase recites that consideration has already been delivered, satisfying the formal requirement that the instrument rest on valid consideration. Courts treat the recital as sufficient even when the actual payment of nominal consideration is not separately proved.
Supporting sources
Does a later promise acknowledging a past benefit become enforceable merely because it recites value received?+
No. A promise made in recognition of a prior unrequested benefit is enforceable only to the extent necessary to prevent injustice and only when the promised amount is not grossly disproportionate to the value actually received. Gross disproportion defeats enforcement even when the promise is in writing.
Supporting sources
1
Excessive Payment Covenant Modification
Venture Holdings owns a parcel subject to a recorded covenant requiring monthly payments to Vitality Foods for private security and beach maintenance. After the city expanded its own services, the private offerings supplied only marginal additional value to the parcel. Venture Holdings sues to modify the obligation. The court reduces the fee because the payments have become excessive relative to the value received by the burdened estate while accounting for Vitality Foods' prior investments made in reliance on the covenant.
Frequently Asked1
When may a court modify a covenant to pay for services based on value received by the burdened estate?+
Modification is available when the payment obligation becomes excessive relative to the cost of providing the services or the value the burdened estate actually receives. Any reduction for decreased value must still account for investments made by the service provider in reasonable reliance on the covenant's continued validity.
Supporting sources
20 N.Y. 268 (1859)Contracts
…of a parol promise; it stands, then, upon the same footing as a written one. Suppose the defendant had given his note in which, for value received of Holly, he had promised to pay the plaintiff and the plaintiff had accepted the promise, retaining Holly's liability. Clearly Holly could not have discharged that promise. No one can…