Consideration in contract law is the value or benefit given by each party in exchange for the other party’s value or benefit—such as money in exchange for products or services, or mutual promises exchanged. Consideration is often referred to as the bargained-for exchange in which one consideration is exchanged for another consideration.

A mere promise to do or refrain from doing something that lacks consideration in the form of a value or benefit provided by the other party (a return promise) is not a contract and is generally not enforceable. One exception to this rule may be if one party promises to do or refrain from doing something, and the second party relies on that promise to its detriment (by spending money, for example), the detrimental reliance may create an enforceable contract.

And if the consideration for a contract is so insubstantial that it is worthless, the contract is said to be illusory and is not enforceable.

In New York, as in other states, consideration is a fundamental component of a valid contract. Consideration refers to something of value that is exchanged between parties when entering into a contract. It can be a promise, an act, or an object, but it must represent a real commitment by both parties. Without consideration, a contract may not be enforceable. New York recognizes the concept of 'bargained-for exchange,' where the consideration given by each party is negotiated and agreed upon. However, if a promise is made without a corresponding benefit or value being returned, it typically does not constitute a valid contract unless there is detrimental reliance. Detrimental reliance, or promissory estoppel, occurs when one party relies on the promise of the other to their detriment, and New York courts may enforce the promise to prevent injustice. Lastly, if the consideration is nominal or so insignificant that it does not constitute a real exchange of value, the contract may be deemed illusory and unenforceable under New York contract law.