INDIAN CONTRACT ACT 1872Group No. 4

santhi narayanan

Presented By:Akansha Poddar (65),Farheen Khan (113),Karishma Chouhan (107),Saurabh Makharia (114),Raghav Seksaria (74),Nisarg Joshi (112),Parvez Shaikh (78),Pratik Mundhra (120),Shreya Gunecha Rituraj palan

IntroductionLaw of contract Foundation upon which the super structure of modern business is builtBusiness promise made between parties performance follows laterBreaking of a promise without incurring liability endless complicationsLaw of contract lays down legal rules relating to promises, their formation, performance and enforcementApplicable not only to business community but others

CONTRACTSec 2(h) An agreement enforceable by law is a Contract.

Two elements - An Agreement Legal obligation i.e, a duty enforceable by law.

AgreementSection 2(e) Every promise and every set of promises forming the consideration for each other, is an agreement.Promise What is a promise?

Sec 2(b) - When the person to whom the proposal is made signifies his assent thereto, the proposal is said to be accepted. A proposal, when accepted, becomes a promise

An agreement is said to be enforceable by law if it creates a legal obligation.If an agreement is incapable of creating a duty enforceable by law, it is not a contract. Thus, an agreement is a wider term than contract.

Enforceability of Agreement

Essential elements of a valid contract Proposal & acceptanceIntention to create legal relationshipFree ConsentCapacity to contractLawful considerationLawful objectAgreement not expressly declared voidCertainty of meaningPossibility of performanceLegal formalities

Proposal and AcceptanceProposal.An offer is the starting point in the making of an agreement.An offer is also called proposalSec 2(a) A person is said to have made the proposal when he signifies to another his willingness to do or to abstain from doing anything with a view to obtaining the assent of that offer to such act or abstinence.

PROPOSALAn offer involves the following essential elements;It must be made by one person to another personIt must be an expression of readiness or willingness to do (i.e., a positive act) or to abstain from doing something (i.e., a negative act)It must be made with a view to obtain the consent of that other person to proposed Act or abstinenceOfferor The person making the proposal is called the offeror or proposer.Offeree The person to whom the proposal is made is called the offeree or the proposee.

AcceptanceAcceptance means giving consent to the offer.It is an expression by the offeree of his willingness to be bound by the terms of the offer. Sec 2(b) A proposal is said to be accepted when the person to whom the proposal is made signifies his assent there to. A proposal when accepted becomes a promise. Acceptance is the consent given to offer.

Contd -How to make acceptance Express acceptance An express acceptance is one in which is made by words spoken or writtenImplied acceptance An implied acceptance is one which is made otherwise than in words.It is inferred from the conduct of the parties or the circumstances of a particular case

Communication of offer and acceptanceMust be complete so as to bind the concerned parties because as soon as the communication is complete the parties loose the right of withdrawal or revocation.(a) Communication of offer It is complete when it comes of the knowledge of the person to whom it is made.

Revocation of offer and acceptance Taking back, withdrawal (sec 5)Time for revocation of proposal A proposal may be revoked at any time before the communication of its acceptance is complete as against the proposer, but not afterwards.Time for revocation of acceptance An acceptance may be revoked at any time before the communication of the acceptance is complete as against the acceptor, but not afterwards.

Consideration is what a promisor demands as the price for his promise.

Essentials of Consideration: It can move from promisee or any other person. It need not be in terms of money only. It need not be adequate. It must be real and not vague. It must be lawful.

Consideration:

Object or consideration of an agreement is unlawful if it is: forbidden by law; or it is of such nature that if permitted it would defeat the provisions of law; or is fraudulent; or involves or implies injury to the person or property of another; or the Court regards it as immoral or opposed to public policy.

Agreements with unlawful consideration or object are void.

Lawful Object:

Every person is competent to contract if he/ sheis of the age of majorityis of sound mindis not disqualified from contracting by any law to which he is subjected.A minor cannot be a competent to contract, if stituation so demand minor can be :-Promisee or transferreAgencyPartnership Quasi Contract

Capacity to Contract:

The parties should mean the same thing in the same sense and agree voluntarily.

Consent is said to be free when it is not1 caused by:CoercionUndue influenceMisrepresentationFraudMistakeFree Consent:

Agreements declared void:Agreements against public policy- Some of the agreements which are against public policy have been declared to be void by law. These are:Trading with enemyChamperty and Maintenance ContractMarriage broken agreementsAgreements for sale of public offices and titlesAgreements in restraint of marriageAgreements in restraint of parental rightsAgreements in restraint of legal proceedingsAgreements in restraint of trade

Void Agreement

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