What does the term "consideration" refer to in contract law?

In contract law, the term "consideration" specifically refers to the benefit or value that each party receives or expects to receive from the contract. It is a fundamental element that distinguishes a legally enforceable contract from a mere agreement. Each party must provide something of value, whether it be a service, money, or a promise, in exchange for the benefit received from the other party. This mutual exchange is essential for a contract to be valid, as it demonstrates that both parties are contributing to the agreement and that there is a basis for enforcement.

The other concepts mentioned, such as legal capacity, negotiation processes, and mutual intent, while important in the realm of contract formation, do not align with the definition of consideration. Legal capacity pertains to the ability of parties to enter into a contract, negotiation involves discussing and reaching terms, and mutual intent signifies the understanding and agreement of both parties to form a contract, but none of these directly relate to the specific value exchanged, which is the essence of consideration.