essential elements of a contract
TRANSCRIPT
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CONTENTS
• Essential Elements of Contract *Proper Offer & Acceptance *Intention to Create Legal Relationship *Free Consent *Capacity of Parties *Lawful Consideration
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Essentials of a Contract
-According to Sec 10, "all agreements are contract if they are made by
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."
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Essential elements of a contract
proper offer & acceptance
legal relationshi -p
free consent
capacity of parties
lawfulconsideration
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Proper Offer & Acceptance
In order to create a valid contract, there must be a 'lawful offer' by one party and 'lawful acceptance' of the same by the other party.
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Proper Offer & Acceptance
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Intention to Create Legal Relationship
• In case, there is no such intention to create a legal relationship on the part of parties, then there is no contract.
• Agreements of social or domestic nature do not make legal relations.
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Free Consent
• 'Consent' means the parties must have agreed upon the same thing in the same sense.
• According to Section 14, Consent is said to be free when it is not caused by-
(1) Coercion, or (2) Undue influence, or (3) Fraud, or (4) Mis-representation, or (5) Mistake. An agreement should be made by the free consent of the parties.
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Capacity of Parties
• The parties of an agreement must be competent. If either of the parties does not have the capacity to understand the contract, then the contract is not valid.
• The following persons are incompetent to contract. (a) Minors, (b) Persons of unsound mind, and (c) persons disqualified by law
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Lawful Consideration
• In the words of Pollock, "Consideration is the price for which the promise of the another is brought."
• Consideration is known as quid pro-quo or something in return.
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References
•Wikipedia
•Business Law by P.C.Tulsian
•Lecture Notes
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