Indian Contract Act, 1872 - Sauda
IndianContract Act, 1872This Chapter Includes The Indian Contract Act, 1872:Concepts and DefinitionsOffer and AcceptanceCommunicationAcceptance and Revocation ofProposalsVoidable Contracts and VoidAgreementsCapacity of PartiesDischarge of Contract Free ConsentConsiderationAgreements expressly declared to be voidContingent ContractsQuasi - contractsThePerformanceofContractsAppropriation of PaymentsChapter at a GlanceBASIC TERMSContract Agreement Enforceability at lawAgreement Offer AcceptanceContract is an agreement between 2 or more parties which is enforceableby law. So contract means an agreement which is enforceable by law.Agreement means every promise & every set of promises formingconsideration for each other. The main essence of an agreement ismeeting of the minds which mean comment of both the parties in thesame name.Law does not cover social agreements into contract because they are ofno legal consequence.
2 Fundamentals of Laws & Ethics CMA Paper-3 (New Syllabus)For example: If A invites B for dinner & B does not come, here is not legalconsequence, so we can say that fall, we the initial elements of a contract:(a) Offer & acceptance.(b) Intension should be to create legal relationship which is presentbusiness transaction.(c) The consideration should be lawful.(d) The parties should be competent to contract which means they aremajor and of round mind.(e) The comment should be free and genuine.(f) The object should be lawful.(g) The agreement should not be declared void.(h) The work should be capable of performance physically as well aslegally.(i) All the legal formalities like stamp paper, registration, etc. if requiredshould be completed.CLASSIFICATION OF CONTRACTS(a) According to validity(i) Valid : Valid contracts are those which have all the essentialelements of a contract.(ii) Void : Void contracts are those contracts which frequently becomeunenforceable.(iii) Voidable : Voidable contracts are those which can be enforced atthe option of one party but not at the option of other party.(b) According to formation(i) Express contracts(ii) Quasi contracts(iii) Implied contracts(iv) E-commerce contractsExpress means written or spoken.Implied means which can be inferred from the circumstances andthe conduct of parties.Quasi contract means a contract which is not intentionally entered
Laws of Contracts 3but is based on the grounds of equality.E-commerce contract is the contract through internet.(c) Classification according to performance(i) Executed contracts – already done.(ii) Executory contracts – being done.OFFER & ACCEPTANCEOffer means when one person signifies to another person his willingnessto do or not to do something with a view to obtain the anent for that act ornot doing that act.Following are the three characteristics of offer:(a) Expansion of willingness.(b) To do or not to do something(c) To obtain the anent of another personLEGAL RULES AS TO OFFER1. An offer may be expanse or implied.2. An offer must given rise to legal consequences.3. Term of offer must be certain and not value.4. Invitation to an offer is not an offer e.g.- newspaper advertisement or adisplay in the showroom is an invitation to an offer.5. Offer may be specific or general.6. Offer should be communicated to the offeree.7. An offer should not contain any term (condition) the non-compliance ofwhich results in acceptance.8. An officer can be made subject to any terms and conditions.9. Two identical can offers cannot make a contract.REVOCATION OF OFFER1. An offer leper after reasonable time.2. An offer lepers by rejection (non-acceptance).3. If an offer is not accepted according to the mode prescribed or notaccepted in a reasonable manner, the offer will lapsed.4. If the offerer or offeree dies or become inline before acceptance.5. It is revoked by non-fulfillment of a condition.6. If subsequently the event becomes illegal then the offer lapser.
4 Fundamentals of Laws & Ethics CMA Paper-3 (New Syllabus)ACCEPTANCEA proposal, when accepted becomes a promise. So, acceptance can bedefined as the anent given by the person to whom the offer was made. Itis like showing a matches to a brain of gunpowder which cannot bereversed.LEGAL RULES FOR VALID ACCEPTANCE1. It can be given by a person to whom the offer was made.2. It should be absolute and on qualified.3. It should be expensed in some reasonable manner. (by telephone orby post)4. It should be communicated by the accepter within a reasonable time.5. It should be given after the offer is made.Communication of offer, acceptance and revocation (book)CONSIDERATIONMEANINGConsideration means something for something. If a person promise to dosomething he must be compensated. It is something for which a promiseis purchased.CONSIDERATIONWhen at the desire of promisor the promisee or any other person does orabstain from doing any act such act on abstinence (not doing) is known asconsideration.BASIC FEATURES OF CONSIDERATIONIt must move at the desire of promisor.It may move from the promisee or any other person (Chinnaya vsRamayya). It means a stranger to consideration can receive. In otherwords we can say stranger to a contract cannot be. But, it has got someexception:Family settlementsWhere a trust is createdWhere the defendant himself is the agent of third party.In case of agency, principles can be although the agreement is done byagent.
Laws of Contracts 5Consideration must be something of value, which means it may or maynot be adequate. But, if it is grossly inadequate, the Court/Tribunal willlook into the matter to see whether it was due to force or some pressure,etc. consideration must be physically and legally possible.“NO CONSIDERATION, NO CONTRACT” GIVE ITS EXCEPTIONGenerally, no contract is there if there is no consideration because lawdoes not recognize promises which are made rashly or withoutconsideration, but, in some cases these contracts can be binding also.1. Natural love & affection2. Compensation for past services3. Agreement to pay a time barred debt. Allowed if it is in writing.4. Gift5. Agency6. Contribution to charity.CAPACITY TO CONTRACT OF PARTIESA person can contract only if he is competent to contract. He should bemajor and of a round mind and showed not be disqualified under any law.In other words we can say the following are incompetent to contract:1. Minors2. Person of unsound mind3. Disqualified persons.Minors – A person who is under 18 years is a minor. But, in some casebelow 21 years is also a minor. (Where property is with the Court/Tribunalof words).MINOR’S AGREEMENTSThe law relating to miner’s agreements is as follows:(a) An agreement with a minor is absolutely void right form the beginningbecome Court/Tribunal protects them on they are not able to decidewhat is good and what is bad for them. (MohiriBibi vs BharmodasGhosh).(b) The contracts is which the minor gets the benefit are valid.(c) Minor cannot ratify the contracts on attaining majority.(d) The rule of estoppel does not apply to a minor.
6 Fundamentals of Laws & Ethics CMA Paper-3 (New Syllabus)(e) A minor is always liable for necessities, but only his estate in liable. Itis not personally liable.(f) Specific performance does not apply to a minor because only hisestate is liable.(g) A minor can always be a partner only for benefits.(h) A minor can be an agent but will not be personally liable.(i) Minor can never be declared insolvent.(j) If a minor and major jointly enter into a contract only major will beliable for the whole.(k) A minor cannot be a shareholder.(l) Minor’s parents are not liable for minor‘s agreements.(m) A minor is liable for any civil wrong.PERSON OF UNSOUND MINDA person is of round mind when he is capable of understanding andforming a rational judgment about the contract. So, a person who is notcapable of the above in called a person of unsound mind.DISQUALIFIED PERSONS (BOOK)(i) Alien Enemy – An alien can be a friend or an enemy. Contract withalien enemy are totally void.(ii) Insolvent – An insolvent cannot enter into a contract because hisproperty rights are with the official receiver.(iii) Convicts – A convict during his imprisonment cannot make acontract. He may make the contract when he is on “Ticket ofLease”.(iv) Foreign Diplomats – They can make contracts but cannot be sued.(v) Lunatics –Mentally deranged person because of some strain orother personal experience.(vi) Idiots – A person who has completely lost his mental powers.(vii) Drunkards – A peers on when drunk, is not capable of forming arational judgment.OTHER ESSENTIAL ELEMENTS OF A CONTRACT
Laws of Contracts 7Consent means when two or more persons agree on the same thing inthe same sense. The comment is said to be free when it is not came by:1. Coercion2. Undue influence3. Misrepresentation4. Fraud5. MistakeCOERCION(a) It is committing or threatening to commit, any act which is forbidden bylaw.(b) It is unlawful detaining or threatening to detain any property.(c) With the intention of forcing the person to enter into an agreement.(d) This is called coercion.IS THREAT TO COMMIT SUICIDE IS COERCION?An attempt to commit suicide or a threat to commit suicide is definitelycoercion because if anybody enters into the agreement because of thisthreat and he is not forbidden by law, then everybody will start doing likethis is saying “I have not done it, because after committing suicide theperson is out of the reach of the law”.So, threat is also prohibited by the Court/Tribunal.UNDUE INFLUENCEUndue influence means when one party is in 9 position to dominate thewill of the other and he was that position to get an unfair advantage. Aperson is deemed to be in 9 position of dominating the will in the followingcases:1. Apparent authorityPolice officer & two accused, master & servant2. Fiduciary authorityFather & son, Doctor & patient, Teacher & student3. Where mental capacity is effected by age, illness, etc.In case of contracts with undue influence, it is voidable at theoption of party whose comment is caused by undue influence.Lack of judgment or lack of knowledge are not sufficient reasons
8 Fundamentals of Laws & Ethics CMA Paper-3 (New Syllabus)for undue influence but if a money lender charge very high rate ofinterest (really high) then it can be undue influence. But charging moreprices by a trader is never an undue influence.DIFFERENCE BETWEEN COERCION & UNDUE INFLUENCECoercion1.It is a threat of an offenceforbidden by law.2. It is physical.3. Intentiontoenterintoagreement.4. Criminal.Undue InfluenceIt is a moral influence by a personwho is in a position to dominate.It is moral.Intention is to obtain an unfairadvantage.Non-criminal.MISREPRESENTATIONA representation means statement of fact made by one party to the otherrelating to some essential matter of the contract. If it is wrong then it canbe misrepresentation (unintentional) and fraud (intentional).MISREPRESENTATION(a) A ve aversion.(b) Innocently (without knowledge of its true or false nature).(c) Any breach of duty without any intention to take any advantage.(d) Which results in entering into an agreement.(e) Made with an intention that it showed be acted upon.(f) The other party has acted on it and suffered some loss.(g) It must be made before the conclusion of contract.EFFECT OF MISREPRESENTATIONThe person affected may:Avoid the contract or1. Accept the contract with the condition that the loss shall be madegood.WHEN THE RIGHT OF RESCISSION (AVOID) IS LOST?The person loses his right to rescind (avoid) the contract if:
Laws of Contracts 91. On becoming aware of the misrepresentation, he takes the benefit orhe affirms (say yes) to the contract.2. If it is not possible to rescind the contract.3. If third party rights have come in between.FRAUDIt is a representation which is:1. False2. Made intentionally3. Without belief in its truth4. Frequently, without caring whether it is true or false.5. A promise made without any intention of performing it.6. Any other act fitted to deceive.The main difference between fraud & misrepresentation is as intentionFraudMisrepresentationIn fraud there is an intention to In misrepresentation there is notdeceive.such intention.EXPLANATION TO THE ABOVE POINTSThe representation should be made without caring for whether it is true orfalse.E.g. – A company issued a prospectus by giving the inf. That there isunbounded wealth existing in a particular mining area, withoutcaring for or having any inf., so this is fraud.The promise must be made without any intention of fulfilling thepromise.E.g. – If a person promises to bring some treasure by magic, it is apromise which cannot be fulfilled, so it is a fraud.DISTINCTION BETWEEN FRAUD & MISREPRESENTATIONFraudMisrepresentation(a) Intention to deceiveNo intention to deceive(b) The person (does not) believe The person believes that what hewhat he is telling is true.is telling is true.(c) Damages can be claimed.No damages can be claimed.
10 Fundamentals of Laws & Ethics CMA Paper-3 (New Syllabus)(d) If there is a fraud the contract If the suffering party can do covercan be avoided.the truth, contract is not avoidable.MISTAKEIt is defined as a wrong belief about something there can be two types ofmistakes:1. Mistake of law2. Mistake of fact.Mistake of Law can be:(a) Of the country: Ignorance of law of the country is not an excuse. Sonobody can say that he shall be pardoned if he does not know the lawof the country.(b) Of foreign country: If a person does not know the law of a foreigncountry, the contract is void and it is treated as mistake of fact.Mistake of fact – Can be two types:1. Bilateral mistake2. Unilateral mistake.Bilateral mistake is when both the parties make a mistake. So theessential characteristic of bilateral mistake are:Mistake is mutualIt is related to a matter which is very essential to the contract.Unilateral mistake: When one of the party is mistake then the contract isnot voidable, but there are two exceptions to this:(a) Identify of the person – If X wants to enter contract with Y then Zcannot accept the offer by saying that he is Y.(b) Nature of contract – If a person enters into a contract which is differentfrom what was intended by inducement (force) of the 3rd part of thenhe can avoid the contract.An old woman was forced to sign some papers which were described asRent Agreements, but infact, they were Sale-Deed of the property. Held,the old woman can set aside the contract because the contract whatdifferent from what she was told.LEGALITY OF OBJECTLaw recognises only there contracts where object is lawful. An object will
Laws of Contracts 11be unlawful in the following cases:1 It is forbidden by law– Anything which is prohibited by any law isunlawful.For e.g. If A promises to B that I will get you a government job for 50,000, the consideration is void because the object is unlawful.2. If permitted it will be against the law – It is possible that a particularact in not prohibited but if it is permitted it will be against the law.For e.g. Giving loan to a person for marriage is not illegal, but if it isgiven to a minor for marriage, it will defeat the provision of childmarriage act.3. If it is fraudulent – If the object of an agreement is to defrayal others, itis unlawful.4. If it gives an injury to the person or the property of a person – Any actwhere any person is assaulted or his property is broken or put to firethere acts are unlawful.5. If the court regards it as immoral – Any act which is regarded asimmoral are unlawful.For e.g. Giving money to a lady for getting divorce from her husbandand then marrying the moneylender in an immoral act.6. If the court regards it as against the public policy – Public policy is avery vague term. There is no of public policy. The main aim of publicpolicy is to act that no person commits an act which is against theinterest of public, society, country.Following agreements have been held to be against the public policy:(a) Trading with alien enemy – Any trading with the enemy country isagainst the public policy because it will boost up the economy ofthat country. Such agreements are unlawful unless they are madewith the permission of Court/Tribunal.(b) Agreements which interfere with the course of justice – If there isany agreement which influence a judge to decide a particular casein favour of one party is unlawful and against the public policy.(c) Agreements for stifling criminal prosecution – Any person who hascommitted a crime must be punished. So, if a person enters into anagreement whereby he drops a prosecution case (criminal) againstB if he gives him some money. It will be unlawful becausecompromise in a criminal case in illegal.
12Fundamentals of Laws & Ethics CMA Paper-3 (New Syllabus)(d) Maintenance and Champerty – Maintenance means where oneperson promises to the other to give money for fighting a caseagainst a 3rd party whereby he has not legal interest in that case.Champerty means where one person units the other in a courtcase (financial or otherwise) where the both will share theproceeds of the case.Both, these agreements are unlawful but these have someexceptions:Giving money for maintenance or champerty in valid.Providing professional services by way of maintenance valid. Foreg. If in an agreement 80% of the money goes to the person whoprovided professional services are not valid to it is reasonable.(e) Trafficking in public officer (Bribe) – It is not allowed as it is againstthe public policy.(f) Agreement creating an interest opposed to the duty – If a personpromises to pay money, if he helps hi, brother to desert the army,it‘s unlawful.(g) Agreement restraining public liberty – If any agreement restrict thefreedom of a person, it is void and illegal.(h) Agreements interfering with parental duties – If any is against theright of guardianship, then it will be an illegal agreement.(i) Marriage brokerage agreements – Any agreement where oneperson promises to get somebody married for monetaryconsideration is void.(j) Agreements to defraud the creditors is void.(k) Agreement in restraint of trade – Any agreement whereby a personis restrained to do or not to do a particular profession or vocation isagainst the public policy and so it is void. Everybody is fee to workthe way he likes, to utilize his talents and skills the way he wants. Itis also in the society interest but one thing should be made surethat it is not unlawful. There are some exceptions to this rule:(i)If the G/W is sold for a business then we cannot carry thatbusiness.(ii) In case of partnership if a partner purchase the G/W then that
Laws of Contracts 13partner can do the same business but others cannot.VOID AGREEMENTSAgreements, the meaning of which is uncertain.All, those agreements whose meaning is uncertain are void. The meaningcan be uncertain with respect to:(a) Quantity;(b) Quality;(c) Price;(d) Anything.WAGERING AGREEMENTA wagering agreement is an agreement between two parties whereby oneparty promises to other to pay money or money‘s worth on the happeningof any uncertain future event. It‘s consideration is that the other party willpay if the event does not happen.ESSENTIALS OF WAGERING AGREEMENT(a) Promise to pay money or money‘s worth.(b) The event must be uncertain.(c) Each party must stand to loose or win.(d) There should be no control over the event.(e) No party should have any other interest in the event.The following transactions are not wagering agreements:Reneweared competitionPuzzle games (picture puzzle, etc).Share market transactions where shares are actually delivered.Insurance contracts.EFFECTS OF WAGERING AGREEMENTThese are void. There can be no Court/ Tribunal action for recovering themoney. If any person has deposited money he cannot recover it.VOID CONTRACTS1. A contract can become void if in the future anything happens whichmakes it void.2. If in a voidable contract, the other party (who‘s comment is not free)
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4 Fundamentals of Laws & Ethics CMA Paper-3 (New Syllabus) ACCEPTANCE A proposal, when accepted becomes a promise. So, acceptance can be defined as the anent given by the person to whom the offer was made. It is like showing a matches to a brain of gunpowder which cannot be reversed. LEGAL RULES FOR VALID ACCEPTANCE 1.
Note: In our discussion on this part of the book, unless otherwise stated, the sections mentioned are those of the Indian Contract Act, 1872. English Mercantile . Indian Status Law . Judicial Decisions . Customs and Usages . The Indian contract Act 1872 . Applicable to whole Indian except the state of Jammu & Kashmir . First day of September .
Introduction - 1) INDIAN CONTRACT ACT, 1872 governs law relating to contracts in India. 2) The Act was passed by British India and is based on the principles of English Common Law. 3) This Act is applicable to whole of India including Jammu and Kashmir. 4) The Act came into effect from 1st September, 1872 and applies to all contracts in India. Important Definitions under the Act -
Åbø i Sauda, og altså en av sønnene til Ingrid Johannesdtr og Endre Perdersson Åbø. Og dessuten bror til Per Rødno (Rødne, Ølen). Per fulgte etter sin yngre bror til Ølen i 1880. I 1872 ble Endre gift i Sauda med Marta Ellingsdtr. Kvamen. Hun var født i 1847 og datter til Mari Eriksd
Definition [Sec. 2 (h)] An agreement enforceable by law is a contract. Essentials of a contract Following are the two basic elements of a contract. (a) There must be an agreement (b) The agreement must be enforceable by law. In other words, Contract agreement enforceability of agreement. The Indian Contract Act, 1872
Short title.-This Act may be called the Indian Evidence Act, 1872. Extent. Extent.-It extends to the whole of India 1*[except the State of Jammu and Kashmir] and applies to all judicial proceedings in or before any Court, including Courts-martial, 2*[other than Courts-martial convened
Habbatus sauda (Nigella sativa) is a plant commonly used as herbal medicine for treatment of diseases while nicotine is an addictive chemical that is present in cigarettes. The study was conducted to observe the effects of Habbatus sauda on histological structures of nicotine treated male
Til Sauda kom nok rocken noe senere, selv om det kom mange plater med sjøfolk og andre som reiste utenlands. Selv %yttet vi til Sauda rundt påske 1961. Årene på barneskolen husker jeg som lite begivenhetsrike, bort-sett fra at jeg lærte å s
and HSC groups were force-fed with Habbatus sauda oil at . L/g body weight and corn oil at .mL/g body weight, respectively. Pure Habbatus sauda oil (Do gaci, Turkey)wasdilutedwithcornoil,whichactedascon-trol for Habbatus sauda . Treatments wer
