Legal Detriment

Plain English

Legal detriment is the price you pay or the burden you take on when you enter a contract. It doesn't have to be money—it can be giving up a right, doing work, promising to do something, or agreeing not to do something. For example, if you promise to quit smoking in exchange for your parent paying your college tuition, your detriment is giving up smoking and your parent's detriment is paying tuition. Both parties must suffer some legal detriment for there to be valid consideration in a contract.

Example

An employer offers an employee a $5,000 bonus if the employee agrees not to work for a competitor for two years after leaving. The employee's legal detriment is giving up the right to work for competitors; the employer's detriment is paying $5,000. Both have suffered legal detriment, so there is consideration.

Used in a sentence

“The court found that the employee's legal detriment—agreeing to a non-compete clause—was sufficient consideration for the raise.”

Related terms