Business LawBusiness Law
Pradeep GiriPradeep GiriAny comment /suggestionAny comment /suggestion
[email protected]@gmail.com
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Contract Act 1871 (Indian Contract Act)Contract Act 1871 (Indian Contract Act)
Agreement enforceable by law is known as contract. Agreement enforceable by law is known as contract. Agreement is offer and acceptance.Agreement is offer and acceptance. All Agreement are not contract but all contract are agreement.All Agreement are not contract but all contract are agreement. Agreement within intention of creating a legal relationship are those Agreement within intention of creating a legal relationship are those
Agreement which can form contact any of the parties failing he may be sued Agreement which can form contact any of the parties failing he may be sued in the court of law.in the court of law.
A promise in return of a promise is consideration.A promise in return of a promise is consideration. Consideration is some thing in return of something.Consideration is some thing in return of something.
Sell PenSell Pen X YX Y Rs. 100/-Rs. 100/-
XX consideration is Rs. 100/- consideration is Rs. 100/- Y Y consideration is a pen.consideration is a pen. Because X sell pen and got Rs.100/- Y give Rs.100 and got pen.Because X sell pen and got Rs.100/- Y give Rs.100 and got pen.
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Proposal Proposal ““When a person signifies to another his willingness to do abstain from doing When a person signifies to another his willingness to do abstain from doing
anything, with a view to obtaining the assent of that other to such act or anything, with a view to obtaining the assent of that other to such act or abstinence, he is said to make proposal” abstinence, he is said to make proposal” Sec2(a)Sec2(a)
AcceptanceAcceptance ““A Proposal is said to be accepted when the person to whom the signifies A Proposal is said to be accepted when the person to whom the signifies
his assent there to . An offer when accepted because a promise. his assent there to . An offer when accepted because a promise. Sec.2(b)Sec.2(b)
Essential Of Valid OfferEssential Of Valid Offer1.1. Offer must intend to create legal relationship.Offer must intend to create legal relationship.2.2. Terms of offer must be define ,unambiguous and certain.Terms of offer must be define ,unambiguous and certain.3.3. Offer must be communicated to the person to when it is made.Offer must be communicated to the person to when it is made.4.4. Offer should not contain a term, the non- compliance of which may be Offer should not contain a term, the non- compliance of which may be
assumed amount to acceptance.assumed amount to acceptance.5.5. An invitation is not a offer.An invitation is not a offer.6.6. A statement of price is not a offer.A statement of price is not a offer.7.7. A offer must be made to assent of that other personA offer must be made to assent of that other person
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Offer :Type of offerOffer :Type of offer1.1. Express:Express: written or oral form written or oral form 2.2. Implied:Implied: These offer are made by conduct or situation. These offer are made by conduct or situation.3.3. Specif ic:Specif ic: those offer which are made for a specific person or group Ex. those offer which are made for a specific person or group Ex.
Bank Provide Citizen person 8% interest.Bank Provide Citizen person 8% interest.4.4. General:General: An offer which is made for every one. An offer which is made for every one.
Essential of valid Acceptance:Essential of valid Acceptance:1.1. It must be absolute and unqualified.It must be absolute and unqualified.2.2. It must be according to the manner described or usual & reasonable It must be according to the manner described or usual & reasonable
manner. manner. 3.3. Must be communicated to the offer.Must be communicated to the offer.4.4. Must be given within reasonable time.Must be given within reasonable time.5.5. Must be given before the offer lapses or withdrawn. Must be given before the offer lapses or withdrawn. 6.6. Must be given the party to whom the offer is made.Must be given the party to whom the offer is made.7.7. Acceptance can not proceeded and offer.Acceptance can not proceeded and offer.8.8. Silence does not amount to acceptance.Silence does not amount to acceptance.
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Consideration Consideration 1.1. Consideration may not be adequate (Enough).Consideration may not be adequate (Enough).2.2. Consideration may not be past, future & present. Consideration may not be past, future & present. 3.3. Consideration must not be illusory (Must be fact).Consideration must not be illusory (Must be fact).4.4. Consideration must be law-full (with a law full Object)Consideration must be law-full (with a law full Object)
Competent Part iesCompetent Part ies : : Who have the capacity to enter the contract, Parties who are not Who have the capacity to enter the contract, Parties who are not
Competent Parties.Competent Parties.1.1. Unsound Mind person.Unsound Mind person.2.2. Person disqualified by law.Person disqualified by law. Miner are those person who are not attained age of majority (18 yrs.) Miner are those person who are not attained age of majority (18 yrs.) In case the court appointed some one as the guartion of a miner to look In case the court appointed some one as the guartion of a miner to look
after the miner and his property. Than the age of majority will be 21 years. after the miner and his property. Than the age of majority will be 21 years. Unsound Mind personUnsound Mind person IdiotIdiot Insane / lunaticInsane / lunatic DrunkardDrunkard
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Sound MindSound Mind A person said to be sound mind who can understand the nature of A person said to be sound mind who can understand the nature of
contract, contained subject of the contract, understand the effect of the contract, contained subject of the contract, understand the effect of the contract and can take rational decision contract and can take rational decision
Idiot:Idiot: Permanently unsound mind Permanently unsound mind Insane / lunatic:Insane / lunatic: Permanently unsound mind Permanently unsound mind Drunkard: Drunkard: Who looses controlled over his mindWho looses controlled over his mind
Person disqualif ied by law.Person disqualif ied by law.1.1. Alien Enemy:Alien Enemy: Declared enemy to the country. Declared enemy to the country.2.2. Convicts:Convicts: Convicts is disqualified Punished by court. Convicts is disqualified Punished by court.3.3. Diplomats:Diplomats: Ambassador of the country, Do not contract. Ambassador of the country, Do not contract. 4.4. Corporations:Corporations: A company can be enter into contract only to the extent A company can be enter into contract only to the extent
they are allow as per there memorandum of association.they are allow as per there memorandum of association.5.5. Insolvent:Insolvent: this person not fill the liability they are not contract, this person not fill the liability they are not contract,
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Free ConsentFree Consent Consent Agreeing upon some thing in the same sense consent is said to be Consent Agreeing upon some thing in the same sense consent is said to be
free if it is not caused by co- erosion.free if it is not caused by co- erosion.1.1. Undue influenceUndue influence2.2. Mis- representationMis- representation3.3. Fraud Fraud 4.4. MistakeMistake
co- erosionco- erosion co- erosion is the committing or threatening to commit any act forbidden by co- erosion is the committing or threatening to commit any act forbidden by
IPC (Indian Panel Court) or the un-law full detaining or threatening to detain IPC (Indian Panel Court) or the un-law full detaining or threatening to detain any property to be prejudice of any person with the intention of causing any any property to be prejudice of any person with the intention of causing any person to enter into contract. Ex- Black mal to contract.person to enter into contract. Ex- Black mal to contract.
Undue influenceUndue influence One of the party is in a dominance Position.One of the party is in a dominance Position. Induces the other party to enter into contract.Induces the other party to enter into contract. He takes unfair advantage out of the contract.He takes unfair advantage out of the contract. Undue influence to graudan supperior an infirior.Undue influence to graudan supperior an infirior.
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Mis- representationMis- representation A false representation of fact innocently . The person making it A false representation of fact innocently . The person making it
honestly belives to the true or which he does not know to be fase Ex- honestly belives to the true or which he does not know to be fase Ex- Re-selling Bike contract.Re-selling Bike contract.
Fraud:Fraud: A fake representation. A fake representation. The representation must be material fact.The representation must be material fact. Re-presentation must be flase and intented Re-presentation must be flase and intented Other party actually decieved.Other party actually decieved. Other party must have suffered the loss. Other party must have suffered the loss. Mistake:Mistake: It occurs when the party is entending to do one thing by error end up It occurs when the party is entending to do one thing by error end up
doing something .else, mistake is erroneous belief about something. doing something .else, mistake is erroneous belief about something. Ex. Ex. Boxer and Hero honda.Boxer and Hero honda.
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MistakeMistake
Mistake of law Mistake of law (Sec.21)(Sec.21)
Mistake of fact Mistake of fact (Sec.20)(Sec.20)
Indian LawIndian Law Foreign LawForeign Law
Contract ClassificationContract Classification 1.1. Express Contract :Express Contract :2.2. Implied Contract:Implied Contract:3.3. Contingent Contract:Contingent Contract:4.4. Quasi Contract:Quasi Contract:5.5. Executed Contract:Executed Contract:6.6. Excutory Contract:Excutory Contract:7.7. Formal Contract:Formal Contract:8.8. Simple Contract:Simple Contract:9.9. Voild Contract:Voild Contract:10.10. Void Contract:Void Contract:11.11. Voidable Contract:Voidable Contract:12.12. Illegal Contract:Illegal Contract:13.13. Unenforceable Contract: Unenforceable Contract:
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1. Express Contract :1. Express Contract :A contract which must be expressed in written Or oral.A contract which must be expressed in written Or oral.
2. Implied Contract:2. Implied Contract: which are create by conduct by Signal, By Body Language, Marriage. which are create by conduct by Signal, By Body Language, Marriage.
3. Contingent Contract:3. Contingent Contract:Which will happen on happing or non-happing of an event co. must be collateral Ex- May Which will happen on happing or non-happing of an event co. must be collateral Ex- May
be happen or not in that period of time.be happen or not in that period of time.
4. Quasi Contract (appear to be ):4. Quasi Contract (appear to be ):It is social contract giving gift in social aspect let no body should be richer at the cost of It is social contract giving gift in social aspect let no body should be richer at the cost of
onther. onther.
5. Executed Contract:5. Executed Contract:Those contract which has been performance by both the party. Ex- If I want to sell a pen Those contract which has been performance by both the party. Ex- If I want to sell a pen
at Rs.100/- and you give me pen on the same time.at Rs.100/- and you give me pen on the same time.
6. Excutory Contract:6. Excutory Contract:These contact which are still to be encuted either by one party / by both party These contact which are still to be encuted either by one party / by both party
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7. Formal Contract:7. Formal Contract:Its mentional in English Law and such contract can be created without Its mentional in English Law and such contract can be created without
considerations. considerations.
8. Simple Contract :8. Simple Contract :Its an Indian Law and in this consideration must be happen.Its an Indian Law and in this consideration must be happen.
9. Voild Contract :9. Voild Contract :Its enforceable by Law such contract are voild then.Its enforceable by Law such contract are voild then.
10. Void Contract :10. Void Contract :They are created but becomes void because of any law or impossibility of They are created but becomes void because of any law or impossibility of
performance. Ex- Cigarette Ban performance. Ex- Cigarette Ban
11. Voidable Contract :11. Voidable Contract :Which can be made void at the obtain of one of the party who is the suffer. This Which can be made void at the obtain of one of the party who is the suffer. This
is in case of where the contract has been due to free consent.is in case of where the contract has been due to free consent.
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12. I l legal Contract :12. I l legal Contract :Those contract which are against the law.Those contract which are against the law.
13. Unenforceable Contract :13. Unenforceable Contract :Those contract which bare not enforceable by court of law because of technical. Those contract which bare not enforceable by court of law because of technical. Essential of valid Contract:Essential of valid Contract:1.1. Offer / ProposedOffer / Proposed2.2. AcceptanceAcceptance3.3. ConsiderationConsideration4.4. Competent parties Competent parties 5.5. Free Consent Free Consent 6.6. Agreement must not be enpressly declared to be void:Agreement must not be enpressly declared to be void: * Agreement with * Agreement with
miner. * Any agreement which is against the existing law. * Agreement against the miner. * Any agreement which is against the existing law. * Agreement against the public policy. public policy.
7.7. Written & Registration :Written & Registration : oral agreement are valid agreement incase the law oral agreement are valid agreement incase the law reqiures any contract to be in writtenreqiures any contract to be in written form and registered than such contract must form and registered than such contract must be in written and registered by court otherwise the contract will be unenforceable be in written and registered by court otherwise the contract will be unenforceable due to technical flow Ex- Please , sale gigts etc.due to technical flow Ex- Please , sale gigts etc.
8.8. Creation of legal relationship Creation of legal relationship 9.9. Certainty Certainty 10.10. Possible of performance Possible of performance 11.11. Enforceable by law Enforceable by law
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Performance of ContractPerformance of Contract It means when both the party fulfill their respective obligation. Performance of It means when both the party fulfill their respective obligation. Performance of
contract two type.contract two type.1. Actual Performance1. Actual Performance : : When the party have completed their obligation.When the party have completed their obligation.2. Offer of Performance/Attempted :2. Offer of Performance/Attempted : When a promiser as made an offer of performance to the promisee and the offer has When a promiser as made an offer of performance to the promisee and the offer has
not been accepted to promiser is not responsible for the performance nor does he not been accepted to promiser is not responsible for the performance nor does he have by loss his rights under the contract. have by loss his rights under the contract.
Offer of Performance also termed as – TENDER Offer of Performance also termed as – TENDER
Essential of val id TenderEssential of val id Tender It must be unconditional – can’t but any father condition. It must be unconditional – can’t but any father condition. It must be of the whole obligation – fulfill the whole part of offer.It must be of the whole obligation – fulfill the whole part of offer. It must be made an proper time and proper place within working hours.It must be made an proper time and proper place within working hours. It must be made to a proper person.It must be made to a proper person. It must be made in the mode prescribe or reasonable mode – by which he prescribe It must be made in the mode prescribe or reasonable mode – by which he prescribe
the mode like call before two days.the mode like call before two days. It may be mode to one of the several joint promises .It may be mode to one of the several joint promises .
Person making the tender must be wil l ing and be able to perform.Person making the tender must be wil l ing and be able to perform.
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Discharge of ContractDischarge of Contract When the rights and obligation created in a contract comes to an endWhen the rights and obligation created in a contract comes to an end A. By performance of contract A. By performance of contract B. By Agreement B. By Agreement
1. Novation1. Novation ( A new contract): – ( A new contract): – In case of novation one of the parties is replace by a new parties but In case of novation one of the parties is replace by a new parties but
all the parties must agree to new contract.all the parties must agree to new contract. 2. Alternation:2. Alternation: In case of alternation the term of the contract is altar with the In case of alternation the term of the contract is altar with the
agreement of the both parties.agreement of the both parties. 15% inter 60 days15% inter 60 days 12% inter 30 days12% inter 30 days
TenderTender
3. Rescission ( Resigned ): 3. Rescission ( Resigned ): The agreement can be discharge by the consolation of the contract. The agreement can be discharge by the consolation of the contract.
A B
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4. Remission: 4. Remission: Both the parties agree to under perform or lower perform of the contract.Both the parties agree to under perform or lower perform of the contract.5. Waiver5. Waiver (to eliminate ) : (to eliminate ) : When both the parties eliminate the one of the firm (Bank) waiver the loan’s interest. When both the parties eliminate the one of the firm (Bank) waiver the loan’s interest. 6. Merger:6. Merger: When in a contract party having the interior right enter into a contract with the same When in a contract party having the interior right enter into a contract with the same
party and for the same subject and he attains superior right party and for the same subject and he attains superior right contract get merge need contract get merge need contract.contract.
7. Owing to happening of an event :7. Owing to happening of an event : To happing of an event happens when some event on the both parties discharge its To happing of an event happens when some event on the both parties discharge its
contract incase of happing of the of a event with is not is the control of the party. Ex.-contract incase of happing of the of a event with is not is the control of the party. Ex.-Factory in fireFactory in fire
C. By lapse of time:C. By lapse of time: When the contract can be discharge offer the time is lapse.When the contract can be discharge offer the time is lapse.D. By operation of law:D. By operation of law: 1. Death1. Death 2. Insolvency: any of the party insolvent the contract will be discharge law has come 2. Insolvency: any of the party insolvent the contract will be discharge law has come
to official assignees.to official assignees. 3. Merger: When two company merge to gather then liability of A and B not may be A 3. Merger: When two company merge to gather then liability of A and B not may be A
B their law has come. B their law has come.
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4. Loss of evident:4. Loss of evident: If any evidence has been lost then by the law you If any evidence has been lost then by the law you
can get it.can get it. 5. By breach of contract:5. By breach of contract: When one of the party of the contract do not When one of the party of the contract do not
perform there part of obligation as per terms and conditions of the contract it perform there part of obligation as per terms and conditions of the contract it is taken breach of contract it is two types is taken breach of contract it is two types
A. Anticipatory:A. Anticipatory: Anticipatory breach is done before the actual Anticipatory breach is done before the actual performance of the contract ( Actual) performance of the contract ( Actual)
B. Actual breach:B. Actual breach: Actual breach is a the breach done on the date of Actual breach is a the breach done on the date of performance.performance.
6. By impossibil i ty (dia-mager) of performance:6. By impossibil i ty (dia-mager) of performance: legal remedies in legal remedies in case of breach of contract .case of breach of contract .
I. Sue for damages.I. Sue for damages. II. Sue for the specific performance. ( painting) II. Sue for the specific performance. ( painting) III. Can rescind the Contract.III. Can rescind the Contract. IV. Sue for quantum merruit: As much as deserves in such case the breach IV. Sue for quantum merruit: As much as deserves in such case the breach
must be done by the promiser himself. (a write to ask)must be done by the promiser himself. (a write to ask) V. Sue for Injunction: As per the contract if not suppose to do something V. Sue for Injunction: As per the contract if not suppose to do something
and incase it does it other party can go to the court and sure for the and incase it does it other party can go to the court and sure for the injunction. injunction.
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Quasi ContractQuasi Contract The law imposes certain obligation of contractual nature of on one of the The law imposes certain obligation of contractual nature of on one of the
parties and confores certain right in favor of the other party even though parties and confores certain right in favor of the other party even though there is nether offer nor acceptance nether agreement nor any promise there is nether offer nor acceptance nether agreement nor any promise such contracts created by law and term is as Quasi contract.such contracts created by law and term is as Quasi contract.
Kind of Quasi contract:Kind of Quasi contract: 1. Supplies of necessaries1. Supplies of necessaries (to in competent parties) (to in competent parties) In case some one supplies necessaries to an in competent parties (minor, In case some one supplies necessaries to an in competent parties (minor,
Lunatic) the person supplies has the right to be conform B’s Properties Lunatic) the person supplies has the right to be conform B’s Properties
Minor/ LunaticMinor/ Lunatic
B’s PropertiesB’s Properties
2. Reimbursement of Payment2. Reimbursement of Payment (By an interested person ) – (By an interested person ) – In case a person pay amount or money which was to be legally paid by In case a person pay amount or money which was to be legally paid by
someone else he must be reimbursed (Return) by person.someone else he must be reimbursed (Return) by person.
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A BA B
3. Liabil i ty of payment for non acidulous acts :3. Liabil i ty of payment for non acidulous acts : If any act has been done in favour of some one and the act is non – If any act has been done in favour of some one and the act is non –
graduitous act then the person must pay for the favour done to him. (Lift of graduitous act then the person must pay for the favour done to him. (Lift of high-way)high-way)
4. Responsibil i ty of Finder of Goods:4. Responsibil i ty of Finder of Goods: The person who finds lost goods of some one and keeps in his possession The person who finds lost goods of some one and keeps in his possession
who is known as finder of goods.who is known as finder of goods. The finder of goods will have to take care of goods as a it is his own goods The finder of goods will have to take care of goods as a it is his own goods
and will have to fine true owner and deliver the goods after taking legal and will have to fine true owner and deliver the goods after taking legal express for keeping maintaining and preserving the goods.express for keeping maintaining and preserving the goods.
Incase he does not get legal expenses he has a right to sell the goods and Incase he does not get legal expenses he has a right to sell the goods and recover legal expenses.recover legal expenses.
5. Payment of money by mistake or co - ercion :5. Payment of money by mistake or co - ercion : If any money has been paid to some one by mistake or co-ercion the person If any money has been paid to some one by mistake or co-ercion the person
must to return by that person who gives him that money.must to return by that person who gives him that money.
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Contract of AgencyContract of Agency Agent is a person who acts on behalf of some one and works within the Agent is a person who acts on behalf of some one and works within the
authority to given to him by the person who appoints him called as authority to given to him by the person who appoints him called as “Principle” “Principle”
Any act done by the agent within the authority is the act of principle and the Any act done by the agent within the authority is the act of principle and the principle for is liable for such act .principle for is liable for such act .
The principle is not liable for any act of the agent done beyond the authority.The principle is not liable for any act of the agent done beyond the authority. The person who is competent to contract can appoint the agent but any The person who is competent to contract can appoint the agent but any
person can opt to become the agent of an in competent party but he will be person can opt to become the agent of an in competent party but he will be liable for all the consequence of the contract.liable for all the consequence of the contract.
A miner can be appointed as an agent but the person who appoints a miner A miner can be appointed as an agent but the person who appoints a miner as an agent he is responsible for all the act of miner.as an agent he is responsible for all the act of miner.
Creation of an Agency:Creation of an Agency: I. Express AgencyI. Express Agency II. Implied AgencyII. Implied Agency A) Agency by EstopelA) Agency by Estopel B) Agency by Holding outB) Agency by Holding out C) Agency by necessityC) Agency by necessity III. Agency by Ratification III. Agency by Ratification
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I . Express Agency:I. Express Agency: It is created either in written on oral form.It is created either in written on oral form. I I . Implied Agency:II . Implied Agency: It is created by conduct or situation or relationship.It is created by conduct or situation or relationship. A) Agency by Estopel:A) Agency by Estopel: If some one projecting himself to be the agent of a person and the person If some one projecting himself to be the agent of a person and the person
who is projected as principle do not prevent him rather by his conduct he who is projected as principle do not prevent him rather by his conduct he makes the 3makes the 3rdrd parties belief that person is his agent this is called agency by parties belief that person is his agent this is called agency by estopel. (Ex- agent about permition of principle )estopel. (Ex- agent about permition of principle )
B) Agency by Holding out:B) Agency by Holding out: In case of holding out the is pre affirmation about any person acting on In case of holding out the is pre affirmation about any person acting on
behalf of the some one.behalf of the some one. C) Agency by necessity:C) Agency by necessity: Such agency is created under urgent or emergency. Situation and there is Such agency is created under urgent or emergency. Situation and there is
no communication from the person on who behalf of some one act such no communication from the person on who behalf of some one act such agency is created by law. agency is created by law.
Ex- Transport driver sold the goods in necessary condition.Ex- Transport driver sold the goods in necessary condition.
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II I. Agency by Ratif ication ( Conformation)III. Agency by Ratif ication ( Conformation) In case agent acts beyond the authority but his act is conform by the In case agent acts beyond the authority but his act is conform by the
principle then such agency is called agency of ratification the whole principle then such agency is called agency of ratification the whole contract should be ratification.contract should be ratification.
90,000 Rs.90,000 Rs.
A B
X
50,000 Rs. Adv.50,000 Rs. Adv.
40,000 Rs. After 30 day’s40,000 Rs. After 30 day’sAgency by RatificationAgency by Ratification
1,00,000 Rs.1,00,000 Rs.
Duties of AgentDuties of Agent
1.1. Agent must act with in the authority given him by the principle.Agent must act with in the authority given him by the principle.2.2. Agent must act honesty and with is skills knowledge and sincerity. Agent must act honesty and with is skills knowledge and sincerity.
3.3. Agent must take direction from principle in case of unfore Agent must take direction from principle in case of unfore
situation but in case of urgency and emergency. Situation the situation but in case of urgency and emergency. Situation the agent can take decision in favour of principle.agent can take decision in favour of principle.
4.4. The agent must maintain make account support by bills.The agent must maintain make account support by bills.5.5. Agent must collect amount on behalf of principle.Agent must collect amount on behalf of principle.6.6. Agent must not make secret profit .Agent must not make secret profit .7.7. Agent must not pass secret information to any 3Agent must not pass secret information to any 3 rdrd Party to act Party to act
again to the principle.again to the principle.8.8. Agent must not do miss conduct.Agent must not do miss conduct.9.9. The agent must not make losses to his X-principle in case of The agent must not make losses to his X-principle in case of
termination of agency.termination of agency.
Right of an agentRight of an agent The agent as right to get remuneration after the completion.The agent as right to get remuneration after the completion. The agent has a right to be compensation for any losses in cured to him to The agent has a right to be compensation for any losses in cured to him to
negligence of principle.negligence of principle. Right of liel –right to possessionRight of liel –right to possession Right of stoppage in transitRight of stoppage in transit Agent has right to ask for law full charge. Ex-Octroi Agent has right to ask for law full charge. Ex-Octroi
Termination of agencyTermination of agency1.1. By Agreement.By Agreement.2.2. Revocation by principleRevocation by principle3.3. Revocation of rightRevocation of right4.4. Performance of contractPerformance of contract5.5. Expiry of time Expiry of time 6.6. Death and insanityDeath and insanity7.7. InsolvencyInsolvency8.8. Destruction of subject matterDestruction of subject matter9.9. Principle become alien enemyPrinciple become alien enemy10.10. Dissolution of the company Dissolution of the company
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Contract of IndemnityContract of Indemnity A contract by which one party premises to sure the other from loss A contract by which one party premises to sure the other from loss
caused to him by the conduct of the promiser himself or by the caused to him by the conduct of the promiser himself or by the conduct by any other person is called is contract of indemnity.conduct by any other person is called is contract of indemnity.
The person who gives the indemnity is called The person who gives the indemnity is called indemnifierindemnifier & the & the person to when the indemnity is given is called as person to when the indemnity is given is called as indemnifiedindemnified or or indemnity-holder. indemnity-holder.
To indemnifier is means sure from losses.To indemnifier is means sure from losses.
Right of indemnity holderRight of indemnity holder The value of indemnity will be all damages & cost of litigation The value of indemnity will be all damages & cost of litigation
atternally if the parties settle for a comprimise of any such soon the atternally if the parties settle for a comprimise of any such soon the indemnity fire is would need to bear to be some to be aid under the indemnity fire is would need to bear to be some to be aid under the compromise.compromise.
Guarantee Guarantee A contact of Guarantee is contract to perform the promise or A contact of Guarantee is contract to perform the promise or
discharge the liability of a 3discharge the liability of a 3 rdrd person in case if his default the person person in case if his default the person who gives the guarantee is called as who gives the guarantee is called as suretysurety the person is respect of the person is respect of whose default the guarantee is give is called whose default the guarantee is give is called Principle debtorPrinciple debtor & the & the person whose the guarantee is given person whose the guarantee is given Creditor Creditor a guarantee may be a guarantee may be either oral or written.either oral or written.
Characteristic Characteristic There are three parties.There are three parties. The loan must exist and must be recoverableThe loan must exist and must be recoverable The primary liability will be principle debtor the liability surety is The primary liability will be principle debtor the liability surety is
secondary secondary
A B
C
Creditor Principle Debtor
Surety
Sales of Goods ActSales of Goods Act It is not necessary in contract of sale that the goods are delivered or It is not necessary in contract of sale that the goods are delivered or
the payments are received at the time of.the payments are received at the time of. “ “ One arty transfer to promises to transfer the property in goods to One arty transfer to promises to transfer the property in goods to
another person against money.”another person against money.”
SellersSellers
Characteristic of contract of seller:Characteristic of contract of seller:1.1. There must be 2 parties those are different and distinct seller and There must be 2 parties those are different and distinct seller and
buyer.buyer.2.2. Subject matter must be inovalble goods.Subject matter must be inovalble goods. Goods means: inovable goods other actionable claim and money Goods means: inovable goods other actionable claim and money
(the debts which can be recovered through court )(the debts which can be recovered through court ) Any thing which a part of land can be several or extract before or Any thing which a part of land can be several or extract before or
after the contract is moveable goods. Ex –Grass, Goal, old coins, after the contract is moveable goods. Ex –Grass, Goal, old coins, Silver coins.Silver coins.
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3. 3. Monetary Consideration:Monetary Consideration:4. Transfer of property: Only general propertied are transferred not the special 4. Transfer of property: Only general propertied are transferred not the special
property.property.5. There must essential elements of valid contract.5. There must essential elements of valid contract. Contract of sales:Contract of sales: it is not necessary in contract of sale the goods are it is not necessary in contract of sale the goods are
delivered and the payment are received at the time of transfer of delivered and the payment are received at the time of transfer of property.property.
Delivery is 3 types:Delivery is 3 types:(I)(I) Actual (time of sale)Actual (time of sale)(II)(II) Symbolic (Key Car’s)Symbolic (Key Car’s)(III)(III) Constructive (Coriour)Constructive (Coriour)
Sale on approval:Sale on approval:GoodsGoods
1. Existing 2. Future 3. Contingent1. Existing 2. Future 3. Contingent
1.Specific 2.Acertained 3.Uncertained Generic 1.Specific 2.Acertained 3.Uncertained Generic
Uncertained goods those goods which are sold by description. Uncertained goods those goods which are sold by description. Future goods that can be manufactured procure or procure at a later date.Future goods that can be manufactured procure or procure at a later date. 27
Contingent goods means that goods which is the subject to certain Contingent goods means that goods which is the subject to certain happing (may or may not be)happing (may or may not be)
Immediate sale executedImmediate sale executed As a future Agreement to sale Executory just inAs a future Agreement to sale Executory just in
Condition & Warranty Condition & Warranty A condition stipulation (term) essential to main purpose of the A condition stipulation (term) essential to main purpose of the
contract the breach of which gives rise to a right the treat the contract the breach of which gives rise to a right the treat the contract as reputed (Cancel).contract as reputed (Cancel).
A warranty is a stipulation (collateral parallel) to the main purpose of A warranty is a stipulation (collateral parallel) to the main purpose of the contract the breach of which gives right to a claim for damages the contract the breach of which gives right to a claim for damages but not right to reject the goods and treat the contract reputiated.but not right to reject the goods and treat the contract reputiated.
In term of money or debt time in never a condition In term of money or debt time in never a condition
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Implied conditions:Implied conditions:1.1. Condition as to TitleCondition as to Title2.2. Condition as to sale by description Condition as to sale by description 3.3. Condition as to sale by sampleCondition as to sale by sample4.4. Condition as to quality or fairnessCondition as to quality or fairness5.5. Condition as to MerchantabilityCondition as to Merchantability6.6. Condition as to whole sameness (goods to human)Condition as to whole sameness (goods to human)7.7. Condition implied by custom.Condition implied by custom. Explanation:Explanation:1.1. The seller must have title over the goods or ownership.The seller must have title over the goods or ownership.2.2. The seller must supply the goods as per description.The seller must supply the goods as per description.3.3. The seller must supply the goods as per the goods quality and requirement of The seller must supply the goods as per the goods quality and requirement of
buyer.buyer.
Implied Warranty:Implied Warranty: Implied Warranty of guest possession.Implied Warranty of guest possession. Implied Warranty freedom of encumbrance.Implied Warranty freedom of encumbrance. Disclosure of dangerous nature of goods.Disclosure of dangerous nature of goods. Caveat – emptor –buyer because (Buyer be aware) Caveat – emptor –buyer because (Buyer be aware)
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Unpaid SellerUnpaid Seller Unpaid seller is a person who not receive whole amount against the goods Unpaid seller is a person who not receive whole amount against the goods
sold in case the seller has receive negotiable instrument agained the same sold in case the seller has receive negotiable instrument agained the same and negotiable instrument has not be owner ed. and negotiable instrument has not be owner ed.
Right of Unpaid sel lerRight of Unpaid sel ler
Against the goodsAgainst the goods Against the buyer Against the buyer
Where the property inWhere the property ingoods is transferredgoods is transferred
When the property in When the property in goods is not transfer goods is not transfer
Right of lie Right of lie
Right of StoppleRight of Stopple
Right to re-saleRight to re-sale
With hold the goodsWith hold the goods
Stopple in transitStopple in transit
Conres and the Conres and the ContractContract
Can sue for Can sue for damagesdamages
Can sue for Can sue for price of goodsprice of goods
Negotiable Instrument (Act 1881)Negotiable Instrument (Act 1881) Transferable documents Transferable documents 1.1. Pay to bearerPay to bearer2.2. Pay on orderPay on order3.3. Pay on demand Pay on demand 4.4. DischargeDischarge Holder in due Course:Holder in due Course: Negotiable Instrument: Negotiable Instrument: A negotiable instrument is transferable it is writing on piece A negotiable instrument is transferable it is writing on piece
of paper creating a right and can be transfer to any person .the person who takes of paper creating a right and can be transfer to any person .the person who takes the document (valid, Jenunine (bonafide) and in good faith, for a certain value is the document (valid, Jenunine (bonafide) and in good faith, for a certain value is called called Holder Holder in due course.The title of holder in due course is not deffective in due course.The title of holder in due course is not deffective even those title of the transfereven those title of the transfer is defective.is defective.
Statutory negotiable instruments:Statutory negotiable instruments: Promissory Note Promissory Note Bill Of Exchange Bill Of Exchange ChequeCheque Promissory Note: Promissory Note: This is an instrument in writing containing an unconditional This is an instrument in writing containing an unconditional
undertaking signed by maker ,to pay a certain sum of money to a person on this undertaking signed by maker ,to pay a certain sum of money to a person on this demand.demand.
*A= Payee, B=maker*A= Payee, B=maker
“ I promise to pay B or Order sum of Rs. 10,0000/- on demand” A
Characteristic:Characteristic: In writtenIn written Unconditional undertaking Unconditional undertaking Certain sumCertain sum Two parties Two parties Bill Of Exchange: Bill Of Exchange: Its an instrument in witting containing an unconditional order, Its an instrument in witting containing an unconditional order,
directing a person to pay a certain sum of money to a person or the bearer of directing a person to pay a certain sum of money to a person or the bearer of the instrument.the instrument.
Characteristic:Characteristic: Instrument in writtenInstrument in written Three parties (Drawer A, Drawee X, Payee B)Three parties (Drawer A, Drawee X, Payee B) Certain sum of money.Certain sum of money. To a certain person.To a certain person.
Pune 11/11/11After 90 day’s pay to ‘B’ or order a sum of Rs.10,00,000/- (Ten Lac only) for the value received.
To, Accepted XSwargate, Pune
A
Cheque:Cheque: Cheque is also a bill of exchange drawn on specified banker and payable on demand .Cheque is also a bill of exchange drawn on specified banker and payable on demand . Dishonor of instrument: Dishonor of instrument: Non –acceptance –bill of exchange.Non –acceptance –bill of exchange. Non Payment –Acceptance for bill exchange within 48 hours after the presentation.Non Payment –Acceptance for bill exchange within 48 hours after the presentation. In case of bill of exchange 3 day’s in grass period but in Cheque its not happen. In case of bill of exchange 3 day’s in grass period but in Cheque its not happen.
Cheque Dishonorment:Cheque Dishonorment: The cheque is ambiguous.The cheque is ambiguous. In sufficient funds.In sufficient funds. The cheque is present before the days.The cheque is present before the days. The cheque has been become stale.The cheque has been become stale. The cheque holder loss the cheque.The cheque holder loss the cheque. If the drawn of the cheque is insure or death.If the drawn of the cheque is insure or death. Advice the stop paymentAdvice the stop payment If the drawer become insolvent.If the drawer become insolvent. If by the order of court ( stop by the order of the court)If by the order of court ( stop by the order of the court)
Endorsements:Endorsements:
In endorsement is the instruction from the person holding the instrument, to pay In endorsement is the instruction from the person holding the instrument, to pay money to the person directed by him given on the notice , this is done by the holder money to the person directed by him given on the notice , this is done by the holder signing on the face or back of the instrument. If this no. space eithersigning on the face or back of the instrument. If this no. space either
On face or back of the instrument can be endorsement on a price of paper and such On face or back of the instrument can be endorsement on a price of paper and such endorsement are known “ Allonage ” endorsement are known “ Allonage ”
The person who endorses the instrument is called endorser and the person in who The person who endorses the instrument is called endorser and the person in who favour the endorsement is done is called ‘endorsee’.favour the endorsement is done is called ‘endorsee’.
Type of Endorsement:Type of Endorsement:1.1. Blank / General Endorsement: Blank / General Endorsement: only signature by endoser.(when father give the sign only signature by endoser.(when father give the sign
cheque.cheque.2.2. Specific / FullSpecific / Full Endorsement: Endorsement: pay to X order and then sign it.pay to X order and then sign it.3.3. Partial Endorsement:Partial Endorsement: This endorsement is done for the residial unpaid amounts. This endorsement is done for the residial unpaid amounts.
4.4. Restrictive endorsement:Restrictive endorsement: Pay to Mr. X only and then sign it. This instrument can not Pay to Mr. X only and then sign it. This instrument can not further endorsesed further endorsesed
5.5. Conditional endorsement:Conditional endorsement:A)A) San Recourse: In case of san recourse the endorser is not liable on the instrumentSan Recourse: In case of san recourse the endorser is not liable on the instrument
Pay to X Rs.50,000/- being residual unpaid amount and then sign it.Pay to X Rs.50,000/- being residual unpaid amount and then sign it. If is never done on the part payment amount. If is never done on the part payment amount.
Pay to Mr. X San Recourse Sign
B) B) Facultative:Facultative: Here the endorser gives up or abandons any of his rights. Here the endorser gives up or abandons any of his rights.
C) San Frais:C) San Frais: In case of san frais the In case of san frais the endorsee is not liableendorsee is not liable on the instrument for on the instrument for any expenses or the liability. any expenses or the liability.
D) Owing to happening of event:D) Owing to happening of event:
Forged Endorsement:Forged Endorsement: It makes the instrument nullified (Value of instrument because zero)It makes the instrument nullified (Value of instrument because zero)
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Pay Mr X if there is a war ( Sign )
Pay Mr. X if marries Y ( Sign)
Pay Mr. X notice of des-honourment waived. ( Sign )
Pay Mr. X san Frais ( Sign )
