8/6/2019 Business Low Indian Con Act, 1872
1/41
PPT PRESENTATION ON THE INDANCONTRACT ACT, ESSENTAL FOR VALDCNTRACT, QUASI ACT ANDREMEDIESFOR BREACH OF CONTRACT
8/6/2019 Business Low Indian Con Act, 1872
2/41
8/6/2019 Business Low Indian Con Act, 1872
3/41
8/6/2019 Business Low Indian Con Act, 1872
4/41
Definition of a Contract
Agreement that can be enforced in
court.
Formed by two or more parties.
Failure to perform results in breach and
damages.
Acc. to Sir William Anson Contract s legally binding agreementmade b/w to or more person by which rights are acquired byone or more to acts or forbearamces on the part of other
8/6/2019 Business Low Indian Con Act, 1872
5/41
AGREEMENTA FOUNDATION STONE OF A
CONTRACTAGREEMENT =OFFERS+ ACCEPTANCE
OBLIGATION THE BENDING OF PERSON TO DO
SOMETHING
ENFORCEABILITY COURSE OF ACTION UPON A PERSON
8/6/2019 Business Low Indian Con Act, 1872
6/41
0N THE BASIS OF FORMATION
EXPRESS CON. IMPLIED CON. QUASI CON.
ON THE BASIS OF PERFORMANCE
EXECUTED CON. EXCUTORY CON.
8/6/2019 Business Low Indian Con Act, 1872
7/41
Agreement
Intention to create legal relationship.
Legal formalities .
Agreement not expressly declared void .
Free Consent of the parties .
Lawful consideration .
Capacity of parties to contract .
Certainty of meaning .
8/6/2019 Business Low Indian Con Act, 1872
8/41
Essentials of offer:
It must be an expression of the willingness to do or
abstain from doing something. Such expression must be to another person.
Such expression must be made with the intention to
obtain the assent of the other person to such an act orabstinence.
8/6/2019 Business Low Indian Con Act, 1872
9/41
Acceptance must be given only by the person to whomthe offer is made.
Must be absolute & unqualified. Must be in prescribed mode or reasonable manner.
Must be communicated.
Within reasonable time.
Acceptance must succeed an offer.
Rejected offers can be accepted only if renewed.
8/6/2019 Business Low Indian Con Act, 1872
10/41
Usually of sound mind.
Usually of unsound mind
Causes: idiocy
Lunacy
Drunkenness
Hypnotism
Mental decay Effects: Void & inoperative
Similar to agreements entered into by minors.
8/6/2019 Business Low Indian Con Act, 1872
11/41
Alien enemies
Foreign sovereigns & ambassadors
Convicts
Married women
Insolvents
8/6/2019 Business Low Indian Con Act, 1872
12/41
Coercion
Undue influence
Misrepresentation
Fraud
Mistake
8/6/2019 Business Low Indian Con Act, 1872
13/41
Voidable
The party exercising coercion exposes himself to criminal
liability under the IPC, besides an action in contract. Burden of proof lies on the party who wants to set aside
the contract on the plea of coercion.
8/6/2019 Business Low Indian Con Act, 1872
14/41
Arepresentation means a statement of fact made by oneparty to the other either before or at the time of contract,relating to some matter essential to the formation of thecontract, with an intention to induce the other party toenter into a contract.
It may be expressed by words spoken or written or impliedfrom the acts or conduct of the parties.
In law, a representation when wrongly made without anintention to deceive the other party is known asmisrepresentation.
8/6/2019 Business Low Indian Con Act, 1872
15/41
Fraud means & includes any of the following actscommitted by a party with an intention to deceive orinduce the other party to enter into a contract:
1. Afalse statement made intentionally is fraud
2. Active concealment of a material fact by a personhaving knowledge of the fact is fraud. However, merenon-disclosure is not a fraud, if there is no duty to
disclose.3. Apromise made without an intention of performing it.
4. Any cat or omission declared by law to be fraudulent.
5. Any other act fitted to deceive.
8/6/2019 Business Low Indian Con Act, 1872
16/41
Mere silence as to facts likely to affect the willingness
of a person to enter into a contract is not fraud, unless:
1. Such a person is under a duty to speak or2. Silence is in itself equivalent to speech.
8/6/2019 Business Low Indian Con Act, 1872
17/41
Right to rescind the contract.
Affirm the contract and ask for restitution, i.e., to be
put in a position, he would have been, if the statementmade had been true.
The aggrieved party can also claim damages.
Fraud by a stranger to the contract does not affect thecontract.
8/6/2019 Business Low Indian Con Act, 1872
18/41
Fraudulent statement must be instrumental in inducingthe party to enter into a contract.
The plaintiff must have been actually deceived by thefraudulent statement.
No action will lie if the plaintiff does not sustain anyloss or injury.
The contract is notVoidable if the party had enoughmeans at its disposal to discover the truth with ordinarydiligence.
8/6/2019 Business Low Indian Con Act, 1872
19/41
Mistake of law:
1. Mistake of law of the country.
2. Mistake of foreign law.
Mistake of fact:
1. Bilateral mistake
2. Unilateral mistake
8/6/2019 Business Low Indian Con Act, 1872
20/41
Void
No restitution.
8/6/2019 Business Low Indian Con Act, 1872
21/41
y Agreements in restraint of marriage
Exception : an agreement restraining the marriage of a minor isvalid.
y Agreements in restraint of trade any kind of restraint of trade,whether reasonable or not is void; however agreementsrestraining freedom of action necessary for carrying on abusiness are not void.
Exception: Sale of goodwill (provided the restraint isreasonable in case of time & space), partners agreements, tradecombinations, negative stipulation in service agreements.
8/6/2019 Business Low Indian Con Act, 1872
22/41
This sec. shall not be deemed to render unlawful a
subscription, or contribution, or an agmt. to subscribe or
contribute, made or entered into for or toward any plate,prize or sum of money, of the value or amount of 500
rupees or upwards, to be awarded to the winner or
winners of any horse race.
8/6/2019 Business Low Indian Con Act, 1872
23/41
In case of quasi contracts there is no offer, acceptance orconsensus; in fact there is no intention on the part of either
parties to enter into a contract; still the law, from theconduct & relationship between the parties, implies apromise, imposing obligation on one party & conferring aright in favor of the other party. Thus under certain specialcircumstances, obligations resembling those created by acontract are imposed by law although the parties havenever entered into a contract.
8/6/2019 Business Low Indian Con Act, 1872
24/41
Aclaim for necessaries supplied to a person incapable ofcontracting
Aperson who is interested in the payment of money (inorder to protect his own interest), which another personis bound by law to pay, and who therefore pays it, isentitled to be reimbursed
Obligation of person enjoying non-gratuitous act the actmust have been done lawfully in good faith; the actmust be non-gratuitous & the person for whom the actis done must have enjoyed benefit of the act.
8/6/2019 Business Low Indian Con Act, 1872
25/41
Under a contract legal obligations are created, which
both the parties to a contract are under a duty to
fulfill. Fulfilling of such legal obligations, orperformance of the promise under a contract by both
the parties is known as performance of a contract.
Performance of all the obligations arising out of a
contract, by all the parties to a contract is the normal& natural mode of discharging a contract.
8/6/2019 Business Low Indian Con Act, 1872
26/41
Only the promisee can demand performance of the
promise under a contract, a third party cannot demand
performance, even though it was made for his benefit. A contract involving personal skill, taste etc., must be
performed by the promisor itself. Where it appears from
the nature of the contract, that the parties intend that
the promise of the contract should be performed by thepromisor itself; then it must be performed by the
promisor only.
8/6/2019 Business Low Indian Con Act, 1872
27/41
Where a contract is of an impersonal nature, theneither the promisor himself or his agent may performthe contract.
Where death of the promisor occurs, before theperformance of the contract, then in such case theliability of performance falls on his legalrepresentatives; unless a contrary intention appearsfrom the contract.
Where a promisee accepts performance of the promisefrom a third person, however afterwards he cannotenforce it against the promisor.
8/6/2019 Business Low Indian Con Act, 1872
28/41
Where several joint promisors with a single
promisee.
Where a single promisor makes a promise withseveral joint promisees.
Where several joint promisors make a promise
with several joint promisees .
8/6/2019 Business Low Indian Con Act, 1872
29/41
Unless a contrary intention appears from thecontract, the right to claim performance restswith all the promisees jointly & a single promisee
cannot claim performance. Unless a contrary intention appears from the
contract, all promisors must jointly fulfill thepromise.
In the absence of an express agmt. to thecontrary, the promisee is entitled to compel anyone or more of the joint promisors to perform thewhole of the promise.
8/6/2019 Business Low Indian Con Act, 1872
30/41
Where one of the joint owners is made to perform the wholecontract, he may realize equal contribution from other joint
promisors, unless a contrary intention appears from the contract.
Where any one of the joint owners fails to make a contribution,then the remaining joint promisors must bear the loss arising
from such failure, in equal shares.
In case of a joint promise, if one of the joint promisors isreleased from his liability by the promisee, his liability to the
promisee ceases, but this does not discharge the other promisorsfrom their liability; neither does it free the joint promisor soreleased from his liability to contribute to the other joint
promisors.
8/6/2019 Business Low Indian Con Act, 1872
31/41
Assignment of contract means transfer of the rights& liabilities arising under a contract, to third
party, with or without concurrence of the otherparty to the contract.
An assignee can bring an action on his owninitiative, against the other party, without making
the assignor a party to the suit. Contracts involving personal skill, taste etc.,
cannot be assigned.
8/6/2019 Business Low Indian Con Act, 1872
32/41
Where time & place is prescribed by the
promisee, the performance of the contract
must be at the specified time & place. Where it is not prescribed, then it must be
within a reasonable time & at a proper place
8/6/2019 Business Low Indian Con Act, 1872
33/41
The promise must be performed by the promisor
in the manner prescribed by the promisee. Such
performance must be in strict accordance withthe mode prescribed.
8/6/2019 Business Low Indian Con Act, 1872
34/41
If parties to a contract agree to alteration, novation or
rescission , the original contract need not be performed.
Where the parties to a contract agree to remit theperformance of the promise, either wholly or in part, the
original contract stands discharged.
In case of aVoidable contract, if the party who has the
option, chooses to rescind the contract, then the other
party need not perform his promise.
8/6/2019 Business Low Indian Con Act, 1872
35/41
Where there is neglect or refusal to provide the promisor
with reasonable facilities for the performance of his
promise, by the promisee; then in such a case the promisoris excused for the non-performance of the contract.
8/6/2019 Business Low Indian Con Act, 1872
36/41
Discharge of a contract refers to a
process, by which the rights and
obligations arising out of a contractcome to an end. Thus, discharge of acontract means termination of a
contract.
A contract may be discharged in anyof the following ways:
8/6/2019 Business Low Indian Con Act, 1872
37/41
Death: contracts involving personal skill or ofa personal nature, stand discharged with thedeath of the promisor.
Insolvency: when the insolvency court passesan order of discharge, the contract standsdischarged.
Merger: where an inferior right contractmerges with a superior right contract, theformer stands discharged automatically.
Unauthorized material alteration: renders thecontract void and hence it standsdischarged.
8/6/2019 Business Low Indian Con Act, 1872
38/41
Breach of contract brings an end to the
obligations arising out of a contract, and
hence the contract stands discharged. The aggrieved party can sue for
damages.
Breach of contract may be anticipatory
or actual.
8/6/2019 Business Low Indian Con Act, 1872
39/41
Rescission of contract
Suit for damages Suit upon quantum meruit
Suit for specific performance
Suit for an injunction
8/6/2019 Business Low Indian Con Act, 1872
40/41
THANKSPRESENTED BY DINESH AND
ANKITA OF BBA-II SECOND SEM.
8/6/2019 Business Low Indian Con Act, 1872
41/41
QUARRYIT,S YR TERM