2. gim gern prl.cont

7/31/2019 2. GIM Gern Prl.cont

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Prof. M.R.K. Prasad


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Contract is the result of a promise

Contract Act assures that the promiseso made is legally enforceable, if anyone of the party fails to abide by the

contract


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What is contract ?

Sec. 2 (h) An Agreement Enforceable

by law


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Agreement

Sec.2 (e) Everypromise and every set of

promises forming the consideration foreach other is an agreement

Offer + Acceptance = Agreement


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Essentials:

1.Plurality of persons

2.Consensus ad idem3.Capacity

4.Consideration5.Free Consent


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Essentials:

6.Lawful object

7.Intention to create Legal obligation Balfour v. Balfour

Meritt v. Meritt

8.Certain and possibility of performance9.Terms must be clear

10.Legal formalities


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Sec. 2 (a) When one person signifies his

willingness to do or to abstain from

doing anything, with a view to

obtaining the assent of that other tosuch act or abstinence, he is said to

make a proposal


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1. Terms must be certain and definite

2. Must be communicated3. Intention to create legal obligation

4. Offer should not impose burden on

offeree


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1. General or Specific Offer2. Express or implied offer

3. Cross offer

4. Counter offer

5. Invitation to offer


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Harve v. Facie

P Will you sell us Bumper hall Pen?

Telegraph lowest cash price

D Lowest price for Bumper Hall Pen, 900

P We agree to buy Bumper Hall Pen for

900


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1. After stipulated time

2. Counter offer3. Rejection

4. Death or insanity

5. By revocation


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Rules

1.Offer will be treated as communicated only

when it is reached2.Acceptance will be treated as

communicated when it is posted

3.Revocation will be treated as

communicated only when it is reached.


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Sec. 2(b) When the person to whom the proposal ismade signifies his assent thereto, the proposal issaid to be accepted. A proposal, when accepted,

becomes a promise.Essentials

1.Must be absolute and un conditional

2.Acceptance only by offeree3.Must be communicated to offeror

4.In prescribed manner and in time.


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Essentials for Validity

1.Contractual Document

2.Reasonable Notice

3.Notice must be contemporaneous to the

contract

4.Conditions must be reasonable

5.No Fundamental Breach of contract6.Statutory protection.


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MinorUnsound Mind

Lunatics

Idiots: is a person who is devoid of the abilityto think. Drunkards

Persons Disqualified by Law Alien enemies Foreign diplomats Convicts


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What is consideration?

The price for which a promise is brought

Some thing in return - quid pro quo

Sec. 2 (d) When at the desire of the promisor, thepromisee or any other person has done orabstained from doing, or does or abstains fromdoing, or promises to do or abstain from doing,

some thing, such act or abstinence or promise iscalled a consideration for the promise.


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1. At the desire of the Promisor

2. From promisee or any other person

3. It may be past, present or future.4. Consideration need not be adequate


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Sec. 2(i) An agreement which is enforceable by law

at the option of one or more of the parties thereto,

but not at the option of the other or others is a

voidable contract.

When consent to the agreement is not free,

agreement becomes voidable.


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Sec. 15: committing, or threatening to commit anyact forbidden by the Indian Penal Code or theunlawful detaining, or detain any property, to theprejudice of any person whatever, with theintention of causing any person to enter into anagreement


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Sec.16

1. A subsisting relation between parties

2. Relation is such that one person is in a position to

dominate the will of other Persons Holding real and apparent authority

Persons in fiduciary relation

Persons in mental distress3. Uses such domination for unfair advantage


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Sec: 18

1.Unwarrented statements:

When a person positively asserts that a fact is true

when his information does not warrant it, though hebelieves it to be true.

2. Breach of duty:

3. Inducing mistake about subject matter


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1. False statement

Silence is fraud?

2. Active concealment of material fact

3. Promise made without any intention to deceive

4. Any other act fitted to deceive

5. Any act or omission as the law specifically declares

to be fraudulent.


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Mistake of law

Mistake of fact

1. Unilateral mistake

2. Bylateral mistake


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Mistake of law

Mistake of fact

1. Unilateral mistake

2. Bylateral mistake


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1. Agreement in Restraint of Marriage Sec.26

Partial restraint

Total Restraint2. Agreement in Restraint of Trade Sec.27

Every agreement by which anyone isrestrained from exercising a lawfulprofession, trade or business of any kindis void to that extent.


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1. Sale of Good will2. Restrain on Employement

2. Trade Combinations

4. Solus agreements

Gujarat Bottling Co. Ltd v. Coca Cola Co.

Stipulation restraining the franchisee(GBC) tomanufacture, bottle, sell, deal or otherwise

concerned with the products of otherbeverages of any other brands duringsubsistence of this agreement held valid not

void.


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3. Agreements which restricts absolutely theparties from enforcing their legal rights is void

4. Agreement which limit the time within which aparty may enforce his contractual rights is void.

Exceptions

1. Reference of future dispute to arbitration.

2. Reference of existing dispute to arbitration


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5.Agreements which are Uncertain and

Ambiguous Sec. 29

5.Agreements by way of wager: Sec.30

6.Agreements to do impossible acts. Sec.56


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1. Object of the agreement is forbidden by law

2. Defeating the provisions of law

3. Agreement for fraudulent purpose

4. Agreement to injure any person or property

5. Immoral

6. Against public policy


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1. Present Breach

2. Anticipatory breach

Right to rescind the contract

Option to wait till the due date


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1. Recession

2. Injunction

3. Specific Performance4. Suit for damages


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Sec: 73.

When contract has been broken the injured party isentitled to

1. Such damages which naturally arose in the usualcourse of things from such breach

2. Such damages which the parties knew, when theymade the contract, to be likely to result from the

breach.3. Such compensation not to be given for any remote or

indirect loss or damage sustained by reason of thebreach


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1. Ordinary damages

2. Special damages

3. Exemplary damages

4. Nominal Damages

5. Liquidated damages

6. Statutory damages

7. Quantum Meruit


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-Prof. M.R.K. Prasad

V.M. Salgaocar College of Law,

Miramar, Panaji, Goa

[email protected]

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