Agreement + Consideration + Enforceable by law
- Social Agreement
- Legal Agreement
Essentials of Contract
Section 2(a) Offer
When a person confesses his willingness to do something or to not do something, with a view of obtaining assent of the other person, it is called a promise.
Section 2(b) Acceptance
Accepted Proposal - Promise
When the person to whom the offer was made, confesses his assent, the proposal is said to be accepted.
Section 2(c) Parties
Offer maker - Promissor
Offer acceptor - Promisee
Section 2(d) Consideration
Price for the contract - Section 23, 24, 25
Section 2(e) Agreement
Set of promises forming consideration for each other
Section 2(f) Reciprocal Promises
Promises which form consideration or part of consideration are called reciprocal promises.
Section 2(g) Void Agreement
Agreement not enforceable by law
Section 2(h) Contract
An agreement enforceable by law.
Section 2(i) Voidable Contract
An agreement enforceable by law at the option of one side of practice (s) but not at the option of other. It is called voidable contract.
Contract = Agreement + enforceable by law
Agreement = (offer + Acceptance) +Consideration
Types of offer
1. Particular offer
Made to 1 person only who can accept
2. General Offer
Offer made to public at large
3. Cross Offer
Both Parties present same offer to each other without prior knowledge.
4. Counter Offer
Offer made in return of offer
5. Open offer/ Standing offer
6. Expressed offer
Expressed orally/ in writing
7. Implied offer
Expressed by conduct
Rules of offer
1. Certain / Clear
2. Not invitation to offer
3. Free consent
6. Not disqualified party
8. Proper Communication
9. Sound Mind
Rules of Acceptance
1. Proper manner
2. Reasonable time to reply
4. Free Consent
5. By Correct person
Expressing final willingness
Intention to create legal relationship
"Acceptance to offer is what lightered matches is to trail of gun powder"
Section 3 - Communication, acceptance and revocation of proposals
- Should be through an act / omission
Section 4 - Communication when complete?
(A) When proposal communication ends ( No Sides)
- When proposee gets knowledge of the proposal
e.g. A sends proposal courier on 7th B receives it on 10th and reads it.
Proposal communication ended on 10th for A and B
(B) When acceptance is completed
e.g. B sent his acceptance on 14th. A receives the courier of acceptance on 17th.
Acceptance received by / granted to A
- When B puts acceptance courier in transition i.e. on 14th
- When Courier sent
Acceptance granted by B
- When A receives the courier i.e. comes his knowledge i.e. on 17th
- When it come to the knowledge
(C) When Revocation is Completed
A wants to revoke
- Can be done only before receiving acceptance from B.
- When it comes to B's knowledge that A wants to revoke
B Wants to Revoke
- Can be done only before acceptance reaches A.
- When it comes to A's knowledge
Section 5 When can revocation be done?
Only before proposer receives acceptance from acceptor
Only before his acceptance courier reaches proposer
Section 6 Lapse of an offer
- Notice to revoke
- Violation of rules
- Death / Insanity of offeror
- Laps of time
Section 7 Absolute Acceptance
Section 8 Acceptance by performing conditions or receiving consideration.
Performance of conditions - Receiving Conditions -> Acceptance
Section 9 Promises, express, implied (conduct)
Section 10 What agreements are contracts?
Section 13-22 - Where parties are willfully entering
Section 11,12 - Parties are competent
Section 23-25 - Lawful object
Section 26-30 - Transition should not be declared void by law
Where parties are competent?
Section 11 - Who all are competent?
- Age 18+ (Indian Majority Act)
- Sound Mind
- Body corporation
- Convict (after jail)
- Insolvent who cleared dues
The following are not competent:
- Alien enemy
- Insolvent who's dues are pending
- Convict (in jail)
- Disqualified by law
Section 12 Eligibility for sound mind
- Capable of understanding terms of contract and its consequences
- If someone is of sound mind at times and un sound mind at ties, he can only during sound mind hours.
- If someone is of sound mind mostly but at times unsound, he can enter when sound mind
1. Where parties are willfully entering ( Section 13 to 22)
Section 13 Consent
Consent = Agree upon same things = meeting of minds = Consensus ad idem
Section 14 Free consent
Consent without the following is free consent:
i. Coercion (15, 19)
ii. Under influence (16, 19A)
iii. Fraud (17, 19)
iv. Misrepresentation (18)
v. Mistake - Law- Fact (20, 21, 22)
Section 15 Coercion
Coercion is committing or threatening to commit any act forbidden by lawor Indian Penal Code.
Unlawful detaining or threatening to detain any property to get that person to enter into a contract with you.
Section 19 Effect of coercion, effect of fraud
Contract is voidable at the option of the person victimized.
Section 16 Undue influence
Relations between the parties are such that one is in a position to dominate the will of the other and uses that position to obtain unfair advantage over the other.
i. Apparent authority
ii. Fiduciary Relationship
Burden of proof shall lie upon the person accused of using undue influence.
Section 19A - Effect of undue influence
Contract is voidable at the option of the person victimized
Section 17 - Fraud
Fraud refers to any of the acts committed by a party to deceive another party or to induce a party to enter into a contract.
i. False Facts
ii. Concealment of facts
iii. Promise without intention
iv. Act fitted to deceive
v. Act declared fraudulent by law
i. A sells by auction to B, a horse of unsound mind. A says nothing about unsoundness of horse. Fraud details are not discussed in auction.
ii. B is A's daughter. A wants to sell the horse to B. He doesn't tell her about unsound mind. Fraud regardless of relationship. A has concealed facts.
Section 18 - Misrepresentation
Pretending to be someone else to mislead a person to enter into contract.
Section 20 Bilateral mistake
Both parties under mistake of fact - void
Section 21 Effect of mistake of law
Mistake of law - valid
Mistake of Int. Law = Mistake of fact
Ignorantia fact excusat
If main essence of contract broke - void
Section 22 Unilateral mistake
One party under mistake of fact - valid
3. Lawful Objects
Section 23 Lawful consideration essentials
i. Forbidden by law
ii. Defeats provisions of law
iii. Fraudulent purpose
v. Court sees as immoral
vi. Opposes public policies
Section 24 Consideration / objects changed in parts. Agreement / contract void.
Section 25 Agreements without consideration = void
Section 23 void wale
i. Love and affection + Registration
ii. Promise to compensate for any act done voluntarily
iii. Promising a time barred debt
Section 26 Agreement in restraint of marriage void, except minors
Section 27 Agreement in restraint of trade - void
Every agreement by which one is restrained from exercising a lawful profession, trade or business of any kind is to that extent void.
Except : Saving of agreement not to carry on business which goodwill is sold.
Section 28 Agreements unrestraint of legal proceedings - void
Section 29Agreements void for uncertainty
Section 30 Agreements by way of wages, void
Except Horse racing Rs. 500>
Section 31 Contingent Contract
A Contingent contract is a contract to do or not to do something if some event collateral to such contract does or does not happen.
Section 56 Agreement to do an impossible act void
Act becomes impossible after contract is made = void
When promising person knew or with reasonable diligence, might have known+ promises did not.
Liable for damages
Section 68 Claim for necessaries supposed to person incapable of contracting or his account.
If a person, incapable of entering into a contract, or any one whom he is equally bound to support is supplied by another person with necessities suited to his condition in life, the person who has furnished such supplies is entitled to be reimbursed from the property of such incapable person.
Right of reimbursement
Section 69 Reimbursement of person paying money due by another ina payment of which he is interested
Section 70 Obligation of persons enjoying benefit of non-gratutious act.
Section 71 Responsibility of binder of goods same responsibility as bailee to Take care.
Section 72 Liability of person to whom money is paid, or thing delivered, by mistake or under coercion. Return, reply
Section 73 Compensation for loss/ damage caused by breach of contract.
Sufferer - breacher
Compensation for breach of contract where penalty stipulated for.
Section 75 Party rightfully rescinding contract entitled to compensation.
Person rightfully canceling the contract entitled to damages restrained through fulfillment of contract.
Note for LLB Entrance Examinations
Nikah- Muslim Marriage Conditions
Hindu Adoption and Maintenance Act 1956
Hindu Minority and Guardianship Act 1956
Hindu Succession Act 1956 Notes
Special Marriage Act 1954 Notes
Historic Development of Law in India
Constitution of India
Preamble of the Constitution of India
Fundamental Rights in Constitution of India
Article 32 Remedies for enforcement of rights
Directive Principles of State Policy
Executive, Judiciary, President, VP
Extent of Powers of Union, Supreme Court etc
State Judiciary, High Court, Lower Courts
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Introduction and passing bills, budget etc
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Emergency - National, State, Financial
EC, PSC, Finance, NCSC, NCST, NCBC
Non Constitutional Bodies, Niti ayog, NHRC etc
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Important amendments to the Constitution
PIL - Public Interest Litigation, Judicial Review
Doctrine of Basic Structure in Constitution
Constitution of India Schedules and Provisions
Theft, Extortion, Robbery, Cheating etc
Tress Pass, Negligence, Nuisance, Defamation
Liability - Vicarious, Strict, Absolute Liability
Crime, Stages, Elements, General Exceptions
IPC Chapter, Provisions and Sections
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Indian Penal Code Sections and Description
Other Laws, International bodies etc
Law of Torts - Civil Tort, Criminal Tort
Contract Essentials valid, void, voidable
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