The Indian Contract Uwsb

8/9/2019 The Indian Contract Uwsb

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The Indian Contract Act,

1872Nature of Law of Contract:

Limiting principles subject towhich parties ma create rightsan! !uties.

jus in personam-Right against aspecifc person


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Defnition o Contract"A contract is an agreement

enforceable b law# $ec 2%h&

• Contract' Agreement( )nforceabilit

• Agreement : ")*er promise an!e*er set of promises, forming theconsi!eration for each other is an

agreement# $ection 2%e&

• Agreement' +er ( Acceptance


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Consensus a! i!em:

• -eeting of min!s in full an! .nal

agreement• /arties to the agreement must ha*e

agree! about the subject matter ofthe agreement in the same sense an!

at the same time0

+bligation:

• Legal obligation or !ut0• "illingness to !o, or

• Abstain from !oing something#


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• )nforceabilit :

• Legal agreement an! a $ocial

agreement

• $ocial agreement !oes not gi*e riseto contractual obligations an! is notenforceable in a court of Law0

)amples:

3n*iting frien! for a !inner

/romise b father for monthlallowance


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)ssential elements of a4ali! contract

10+er an! Acceptance

20 3ntention to create legal relationship

50Lawful consi!eration

60 CapacitCompetenc of parties

09ree Consent

0Lawful object

70 Agreement not !eclare! *oi!80 Certaint an! possibilit of

performance

;0Legal 9ormalities


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All contracts areagreements,

butall agreements are not

contracts


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+er an! Acceptance

• "hen one person signi.es toanother his willingness to !o orabstain from !oing something, with a

*iew to obtaining the assent of thatother to such act or abstinence, he issai! to ma=e a proposal# $ec 2%a&

• )press oer> or!s spo=enwritten• 3mplie! oer>from con!uct


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$peci.c oer

+er ma!e to a !e.nite person

?eneral oer

oer ma!e to the worl! at large

Case Law:

•

$arlill % $arbolic !mo&e ball $o'


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$arlill % $arbolic !mo&e ball$o'

• A compan a!*ertise! in se*eralnewspapers that a rewar! or @ 1 woul!be gi*en to an person who contracte!inBuena after using the smo=e balls ofthe compan accor!ing to its printe!

!irections0 +ne -rs0 Carlill use! thesmo=e balls accor!ing to the !irectionsbut still contracte! inBuena0

•

Del!, she ha! accepte! the oer0

• ?eneral oer can be accepte! b anperson0


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Legal Eules as to oer

• +er must be capable of beingaccepte!

• -ust be !e.nite, certain an! not *ague

•

-ust be !istinguishe! from 3n*itationto oer

• +er must be communicate!

• Non compliance shoul! not be

acceptance

• Cross +ers, Counter +ers


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Communication of oernecessar

• 3n Lalman shu=la 4s ?auri Futt, AGsnephew abscon!e! from home0 A senthis ser*ant to search the missing bo0

After the ser*ant ha! gone, Aannounce! that a rewar! of Es 1> willbe pai! to an one who foun! the lostbo0 hen ser*ant came to =now about

rewar! he claime! the same0 Del!,ser*ant being ignorant of the oer ofrewar! coul! not be !eeme! to ha*eaccepte! the same0


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Legal rules as toacceptance

• -ust be absolute an! uncon!itional

• -ust be communicate! to the oerer

• -ust be accor!ing to mo!e prescribe!

• -ust be gi*en within reasonable time

• Cannot prece!e an oer

• Cannot be implie! from silence

• Acceptance shoul! be ma!e while theoer is still subsisting


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Ee*ocation of +er an!Acceptance

• Hefore the oer has beenaccepte!, the same ma bere*o=e! or with!rawn00

• /rospecti*e Eesignation is anoer to Iuit the post0 3t can bewith!rawn before beingaccepte!0


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Ee*ocation of /roposalsan! Acceptance

• A proposal ma be re*o=e! at antime before the communication of itsacceptance is complete as against

the proposer, but not afterwar!s0

• An acceptance ma be re*o=e! at an

time before the communication of theacceptance is complete as againstthe acceptor, but not afterwar!s0


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hen communication ofacceptance complete

• hen parties are face to face, thecommunication of acceptance tothe oeror, both parties become

boun! imme!iatel0

• hen parties are at !ierent

places an! the communicate bpost, telephone etc, the position is!ierent00


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Acceptance b /osts0 etc

• Accor!ing to $ec 6,

• The communication of acceptance iscomplete:

• as against the proposer , when it is putin the course of transmission to him,so as to be out of the power of theacceptor,

• as against the acceptor , when it comesto the =nowle!ge of the proposer0


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C+N$3F)EAT3+N

• “(hen at the desire o the promisor, the promisee or any other person has done orabstained rom doing, or does or abstainsrom doing, or promises to do or abstain

rom doing, such act or abstinence or promise is called the consideration or the promise

Sec 2(d)

10An act

20Abstinence

50Eeturn promise

J ! N th 4 ? i


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Je!ar Nath 4s ?auri-ohamme!

• The town planners of howrah,thought a!*isable toerect a townhall0 ith the object in *iew thecommisioner of howrah municipalit starte! to raisenecessar fun! b public subscription0the !efen!antsone of the subscriborGs of this fun! for Es 1 signe!his name in the subscription boo= at that amount0 +nthe faith of the promise! subscription the plainti%commisioner of the howrah municpalit& entere! intoa contract with a contractor for the purpose of thebuil!ing the town hall0 Later the !efen!ant subscriberreferre! to pa the amount upon the promise to pa subscribe0 3n other wor!s ,he conten!e! that therewoul! be no personal bene.t signi.cance b the

construction of the hall0

• Del! :• De was hel! liable0 The Act of plainti is entering into

contract with the contractor was !one at the !esire ofthe promisor0


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Legal Eules as toConsi!eration

10 3t must mo*e at the !esire of thepromisor

20 -a mo*e from promisee or an other

person50 -a be an act, abstinence

60 -a be past, present or future

0 Nee! not be a!eIuate

0 -ust be real an! not illusor

70 -ust be something which promisor is notalrea! boun! to !o


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/ri*it of Contract

• Foctrine of /ri*it of contract• +nl parties to a contract ma sue an! be sue!

on that contract• Eelationship subsisting between parties who

ha*e entere! into contractual obligations0

• Funlop /neumatic Tre co0 Lt! 4 $elfri!ge co0Lt!

• $ Hought tres from the Funlpo Eubber Co0 an!sol! them to F, a sub>!ealer who agree! with $

not to sell these tres below Funlop,s list pricean! pa Funlop Co @ as !amages on e*er treun!ersol!0 F sol! two tres at less than that0Funlop sue!0 Del!, Funlop was stranger tocontract0

A contract without


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A contract withoutconsi!erations is *oi!:

)ceptions• Natural Lo*e an! aection

• %in writing, in fa*our of near relati*e, out

of natural lo*e an! aection an!registere!&

• Compensation for *oluntar ser*ices

• /romise to pa a time barre! !ebt

The Indian Contract Uwsb

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