What is the principle of public policy in contract consideration?

The principle of public policy in contract consideration emphasizes that the consideration involved in a contract must align with societal norms and values. This means that for a contract to be enforceable, the purpose or terms of the agreement must not contravene the accepted standards of what is considered acceptable behavior within society. Contracts that involve illegal activities, immoral acts, or harm the public interest are typically deemed void, as they violate the principle of public policy.

The rationale behind this principle is to ensure that legal agreements promote social welfare and do not support actions that could lead to negative consequences for individuals or the community at large. Thus, when evaluating the validity of a contract, courts will consider whether the consideration or the subject matter of the contract adheres to established moral and legal guidelines.

In contrast, the other options do not accurately capture the essence of public policy in contract consideration. For instance, financial gain is not a requirement for consideration, and while some aspects of consideration might not affect contract validity, such conditions must still comply with public policy to be enforceable. Therefore, the correct understanding revolves around the idea that consideration must align with societal norms.