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    Chap 1

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    theja108
    The document discusses the nature of contracts under Indian law. It defines a contract and explains the essential elements for a valid contract. It also discusses different types of contracts including [1] valid and voidable contracts, [2] express and implied contracts, and [3] unilateral and bilateral contracts. The key points are: 1. A contract is an agreement enforceable by law containing an offer, acceptance, lawful consideration and intention to create legal obligations. 2. For a contract to be valid it must satisfy elements like free consent, lawful object, competent parties and certainty of meaning. 3. Contracts are classified based on their validity, mode of creation, extent of execution and nature of obligations.

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    Chap 1

    Uploaded by

    theja108
    255 views17 pages
    The document discusses the nature of contracts under Indian law. It defines a contract and explains the essential elements for a valid contract. It also discusses different types of contracts including [1] valid and voidable contracts, [2] express and implied contracts, and [3] unilateral and bilateral contracts. The key points are: 1. A contract is an agreement enforceable by law containing an offer, acceptance, lawful consideration and intention to create legal obligations. 2. For a contract to be valid it must satisfy elements like free consent, lawful object, competent parties and certainty of meaning. 3. Contracts are classified based on their validity, mode of creation, extent of execution and nature of obligations.

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    The document discusses the nature of contracts under Indian law. It defines a contract and explains the essential elements for a valid contract. It also discusses different types of contracts including [1] valid and voidable contracts, [2] express and implied contracts, and [3] unilateral and bilateral contracts. The key points are: 1. A contract is an agreement enforceable by law containing an offer, acceptance, lawful consideration and intention to create legal obligations. 2. For a contract to be valid it must satisfy elements like free consent, lawful object, competent parties and certainty of meaning. 3. Contracts are classified based on their validity, mode of creation, extent of execution and nature of obligations.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    255 views17 pages

    Chap 1

    Uploaded by

    theja108
    The document discusses the nature of contracts under Indian law. It defines a contract and explains the essential elements for a valid contract. It also discusses different types of contracts including [1] valid and voidable contracts, [2] express and implied contracts, and [3] unilateral and bilateral contracts. The key points are: 1. A contract is an agreement enforceable by law containing an offer, acceptance, lawful consideration and intention to create legal obligations. 2. For a contract to be valid it must satisfy elements like free consent, lawful object, competent parties and certainty of meaning. 3. Contracts are classified based on their validity, mode of creation, extent of execution and nature of obligations.

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    of 17

    Nature of Contract

    Synopsis :
    1. Introduction
    2. Meaning of Business Law
    3. Sources of Business Law
    4. Business Law in India
    5. Contract Act, 1872
    6. Meaning of Contract
    7. Essential elements of a valid Contract
    8. Classification of Contracts
    1. INTRODUCTION

    Law :
    The term `law¶ refers to rules of conduct enforced by the
    State to maintain peace and order in the society
    Definition of Law :
    Austin has defined law in the following words : `A law is
    rule of conduct imposed and enforced by the Sovereign.¶¶
    Salmand defined law as `the body of principles recognized
    and applied by the State in the administration of justice.¶¶
    Holland defined law as ``rule of external human actions
    enforced by Sovereign Political Authority.¶¶
    2. MEANING OF BUSINESS LAW
    uusiness law is a branch of General Law. It relates to
    industry, trade and commerce. It includes law relating to contracts,
    sale of goods, partnerships, negotiable instruments, companies,
    cooperative societies etc. Further, consumers are a special
    constituent of any business. Consumers Protection Act not only
    recognises the importance of safeguarding the rights and interests of
    the Consumers but also puts every business on alert and answerable
    to the consumer
    3. SOURCES OF BUSINESS LAW
    1. English Mercantile Law
    2. Statutes of Indian Legislature
    3. Judicial Decisions
    4. Customs and Usage
    4. BUSINESS LAW IN INDIA

    1. Contract Act, 1872


    2. Negotiable Instruments Act, 1881
    3. Sale of Goods Act, 1930
    4. Partnership Act, 1932
    5. Companies Act, 1956
    6. Securities Contracts (Regulation) Act, 1956
    7. MRTP Act, 1969
    8. Foreign Exchange Management Act, 1999
    9. Patent Act, 1970; Copy Right Act, 1957; Trade and
    Merchandise and Marks Act, 1958
    10. Sick Industrial Companies (Special Provision) Act, 1985
    11. Consumer Protection Act, 1986
    12. Environment (Protection) Act, 1986
    13. Essential Commodities Act, 1955
    14. Information Technology Act, 2000
    15. Competition Act, 2002
    5. CONTRACT ACT, 1872
    1. Applicability : The Contract Act, 1872 is the most important
    constituents of Indian Mercantile Law. It affects every person
    since every one of us enters into a contract virtually every day.
    2. Coverage of the Act
    The act deals with the basic principles of the law of contracts.
    It deals with general principles of Contracts and special
    contracts as given below in the following chart.
    Chart - 1
    Indian Contract Act

    General Rules
    relating to Special types of
    Contracts contracts
    Sec.1 - 75 Sec. 124 - 238
    1. General Principles of Contracts (Sec.1-75) :
    General principles of contracts include rules and laws relating to
    communication, acceptance and revocation of proposal (Sec.2-9)
    voidable contracts (Sec.10-19 A and 22-23), void agreements
    (Sec.11,22,30, 32, 36. 56, 57 and 64-67), contingent contracts
    (sec.31-36), performance of contracts (Sec.37-67) certain relations
    resembling those created by contracts (Sec.68-73) and consequences
    of breach of contract (Sec.73-75).
    2. Special Types of Contracts :
    Sec.124 to 238 deal with special types of contracts. These are
    contracts of Indemnity and Guarantee (Sec.124 to 147) uailment and
    pledge (Sec.148 ± 181) and Agency Contracts (Sec.182 ± 238).
    6. MEANING OF CONTRACT
    1. Contract ± Definitions :
    Let us go through some definitions relating to contract.
    Salmond : A contract is an agreement, creating and defining the
    obligation between parties.

    Sir William Anson : A contract is an agreement enforceable at


    law made between two or more persons by which rights are
    acquired by one or more to acts or forbearances on the
    part of others.
    Sir Fredrick Pollock : Every agreement and promise enforceable
    at law is a contract.
    Contract Act : Section 2(h) of the Act states that an agreement
    enforceable by law is a contract. Therefore, a contract
    essentially consists of two elements : (i) an agreement, and
    (ii) its enforceability by law.
    6.2 Essential Requirements of Contract
    1. Two parties
    2. An agreement : Agreement = Offer + Acceptance

    Consensus-ad-idem
    3. Legal obligation
    6.3 Agreements which are not contracts :
    1. Agreements relating to social matters
    2. Domestic agreements between husband and wife
    Balfour Vs. Balfour (1919)
    ÷  
         
    
      
    
    
     
     
          
    
     
    
         
    
    
    
    
     
     
      
     
        
      
    
       
     
    
    6.4 All contracts are agreements but all agreements are not contracts
    6.5 All obligations do not constitute contracts
    Ë Torts or civil wrongs
    Ë Quasi contracts
    Ë Judgements of Courts
    Ë Status of obligations like relationships of husband and wife

    7. ESSENTIAL ELEMENTS OF A VALID CONTRACT


    According to Section 10 all agreements are contracts if
    they are made by the free consent of the parties competent to
    contract, for a lawful consideration and with a lawful object,
    and are not hereby expressly declared to be void. Thus, an
    agreement becomes a valid contract if it has the following
    elements.
    1. Offer and acceptance
    2. Intention to create legal relationship :
    3. Lawful Consideration
    4. Competence of parties to Contract
    5. Free consent
    6. Lawful object
    7. Agreement not declared as void
    8. Certainty and possibility of performance :
    9. Legal formalities
    CLASSIFICATION OF CONTRACTS
    Chart ± 2

    Classification of Contracts

    Validity and Extent of


    Enforceability Execution
    Mode of Obligation to
    Creation perform
    Classification of contracts on the basis of validity and
    Enforceability :
    1. Valid contracts
    2. Voidable contracts
    3. Void Contract
    Classification of contracts on the basis of Mode of Creation :
    1. Express Contracts
    2. Implied contracts
    3. Quasi Contracts
    Classification on the basis of extent of execution :
    1. Executed Contracts
    2. Executory Contract
    Classification on the basis of the obligation to perform :
    1. Unilateral Contracts
    2. Bilateral Contract
      

     
         
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