Prof. Ravindra T.

Jadhav, Advocate, High Court History Law of King, Eye for Eye British Rule Court Formed Privy Council Court Law was based on Condition Precedent Law was not codified Government of India act 1935 Drafting was formed to prepare the Constitution of India Constitution of India came into force from 26.11.1949 Constitution of India 395 Articles and 12 Schedule Ignoratia juris non excusal

Legal System in India

Codified, Statutory A. Civil Law 1. Civil Procedure Code 2. Property Law 3.Company Law 4. Intelectual Property Law 5. Commercial Law a. Sale of Goods Act b. Partnership Act 6.Consumer Protection Act

B. Criminal Law 1. Criminal Procedure Code 2.IPC 3 MCOC Difference in Civil & Criminal Law 1. Suit & Complaint 2. Parivate party & State or Prosecution agency 3. Compensation & Punishment 4. Appearance by Advocate & Personal Appearance

Court System in India :Apex Court Supreme Court High Court City Civil & Sessions Court

Indian Evidence Act

LAW OF CONTRACT 1. Importance Came in to force from 1.9.1872. Appicable to whole India except J&K Use in daily life Business based on LOC Codified from Section 1 to 238 Section between 75-124 is repealed. A. Proposal S. 2a When one Person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other, to such act or abstinence, he is said to make a proposal . Main Ingrediant of Proposal 1. Offer 2. Communication of Offer Powell V Lee ( Head Master Post Appointment) 3. Invitation to Offer ( Examples :Mall , Shop) a. Difference that Offer b. Auction, Tender Notice, List of Bokseller, Menu in Hotel Acceptance S 2b When the person to whom the proposal is made signifies his assent thereto the proposal is said to be accepted 1. Absolute 2. Expressed in usual manner 3. Acceptance must be in the way prescribed by Offeror Henderson Vs Stevenson ( Luggage loss case) Har Bhajan Lal V/s Harcharan Lal AIR 1925 All 539 ( Boys ran away Case) Lalman V/s Gauri Dutt (1913) ( Munim circulate Handbill case)

Promise, Promisor & Promisee When a proposal is accepted , it becames a promise. The person making the proposal is then called the promisor and the person to whom it is made is called the promise. 1. 2. 3. 4. Express Implied Reciprocal Alternative

Consideration S 2d When at the desire of the promisor the promisee or any other person has done or abstained from doing or does or abstains from doing or promises to do or abstain from doing something such act abstinence or promise is called a consideration for the promise. At the desire of promisor ( Durga Prasad V/s Baldeo 1881 Case) The promisee or any other person Can a stranger to the consideration sue Bewick V/s Bewick ( widow Claim) Chinnaya V/s Ramaya ( Daughtor refused pay) Babu Ram V/s Dhan Sing AIR 1957 Agreements & Contract Under S.2 e - promise and and set of promises forming the consideration for each other is an agreement. S 2 g - An Agreement not enforceable by law is said to be Void. Valid Agreement Voidable Agreement

Unenforceable Agreement Void Agreement Illegal Agreements

Contract
S2h defines Contract is an agreement enforceable by law Under Section 10 all agreements are contracts if they are made : 1. by the free consent 2. of parties competent to contract 3. for a lawful consideration and lawful object , and 4. are not expressly declared to be void Contract required to be in writing Sec 14 Consent is said to be free when it is not caused by : 1. Coercion 2. Undue influence 3. Fraud 4. Misrepresentation 5. Mistake S 11 lay down that a party competent to contract i.e.if 1. he is of the age of Majority 2. he is of sound mind 3. he is not disqualified from contracting by any law to which he is subject. According to Indian Majority Act a minor is one who has not completed 18 years of the age. MOHIRI BIBI V/s DHARMODAS GHOS (1903) Contract by guardian A valid contract can however be made by a guardian on behalf of minor , if the following two condition are satisfied 1. the guardian is competent to do so and

2. the contract is for the minors benefit or for the minors legal necessaries. Contract by Unsound Mind Person Contract by Drunkards Contract by insolvent Contract by corporation Contract by Govt. ( Art. 299) Cundy V Lindsay (1878)

Coercion Sec.15 1.the committing of any act forbidden by the IPC 2.the threatening to commit any act forbidden by IPC 3.the unlawful detaining of any property to the prejudice of any person whatsoever ; or 4.the unlawful threatening to detaining any property to the prejudice of any person whatever With the intention of causing any person to enter into an agreement. Amiraju V/s Seshamma ( 1912) ( threatening of suicide for signing release deed by Husband)

Undue influence Section 16 Where the relation subsisting between the parties are such that one of the parties is in a position to dominate the will of the other and uses that position to obtain an unfair advantage over the other. Illustration :1. Father & son 2. Patient & Doctor 3. Banker & borrower 4. Property gifted to Spiritual Advisor

Fraud Section 17 Fraud means and includes any of the following act committed by part to contract or with his connivance or by his agent with intent to deceive another party thereto or his agent or to induce his to enter into the contract 1. the suggestion as to a fact of that which is not true or which he does not believe to be true. ( Suggestion Falsi) 2. the active concealment of fact by one having knowledge or belief of the fact ( Suppresion Veri) 3. a promise made without any intention of performing it, 4. any other act fitted to deceive 5. any such act or omission as the law specially declares to be fraudulent. Example : Company issuing debentures fraudulently. A sells horse to B being knowing the horse is unsound . But A said nothing. B says to A if you do not deny it I shall assume that the horse is sound. A says nothing. Here As silence is equivalent to speech. Misrepresentation Section 18 Misrepresentation means and includes a. the positive assertion in a manner ot warranted by the information of the person making it of that which is not true through he believes it to be true. ( Example :- A learns from X that B would be a director of Company

about to be formed. A Informed this to M And induced him to purchase shares. Information is hearsay.) b. Any breach of duty which , without an intent to deceive gain an advantage to the person committing it or any one claiming under him , by misleading another to his prejudice or to the prejudice of any one claiming under him. c. Causing however innocently a party to an agreement to make a mistake as to substance of the thing which is the subject of the agreement. John V/s Crew ( 1874) ( Bridge for delivery boiler) A horse belonging to A . B visited As stable for examination. A assured that horse is sound . B Purchased horse in Auction . Before delivery it was proved that horse is unsound.

Mistake Sec 20 & 22 Where both the parties to an agreement are under a mistake as to a matter of fact essential to the agreement, the agreement is void. Illustration :a. Agrees to sell to B a specific cargo of goods supposed to be on its way from England to Bombay . Meanwhile actually ship damaged in journey and goods lost . Neither party was aware of the facts. The agreement is void. b. A agrees to buy from B a certain horse . But before bargain horse dead. Neither party was aware of the fact. The agreement is void.

c. A being entitled to an estate for the life of B agrees to sell C. But before execution agreement B expired . Both parties ignorant of fact. The agreement is Void. Mistake of Law S.21 As to mistake of law S.21 provided that a contract is not violable because it was caused by a mistake as to any law in force in India but a mistake as to a law not in force in India has the same effect as mistake of fact. Ram Ruton V/s Municipal Committee AIR 1939 ( Agreed between the parties that Judgement Debtor would not file a Appeal and Decree holder will not claim Cost of the suit)

U/s 23 Lawful Consideration & Lawful Object The Consideration or object of an agreement is lawful unless :i) it is forbidden by law ;or ( Agreement to earn by fraud )( Agreement to divide earning from Robbery) ii) is of such a nature that if permitted it would defeat the provision of any law;or ( recovery to amt of Surety) ( Com. Law Prov.) iii) is fraudulent ;or iv) involves or implies injury to the person or property of another ; or ( defamatory article) v) the Court regard it as immoral , or opposed to public policy.

Contract may be for Partly Lawful Consideration. Example :- 1. Sevant for adultory, 2. Pleader & Client Following Contract are against the Public Policy : 1. Contract amounting to trading with an enemy 2. Contract for stifling prosecution 3. contract for encourage litigation 4. Marriage broakerage 5. Contract interfaring with course of justice 6. Countract tending to create interest against duty 7. Contract as regard the sale of public offices 8. Contract tending to create monopolies 9. Contract between Pleader & Clients

Agreements without Consideration 1. Made love & affection 2. writing & registered 3. Promise to compensate to a person who has already voluntarily done something 4. Time barred debt. Agreements in restraint of Marriage (S.26) Every agreement in restraint of the marriage of any person other that a minor is void.

Agreement in restraint of trade (S.27) Exception : The Indian Partnership act:1.If the partner agrees with his other parner that as long as the parner remains a parner he shall not carry on any other business 2.on ceasing to be a partner he will not carry on any business. Agreement in restraint of Legal proceedings (S 28) Exception : Arbitration

Agreements which are uncertain ( S 29) Agreements by way of wager ( s. 30)

Void agreements
section 2(g) An agreement not enforceable by law is said to be void. Following are void agreements Both parties under mistake of fact (section 20) Unlawful object or consideration (section 24) Agreement without consideration (section 25) Agreement in restraint of marriage (section 26) Agreement in restraint of trade (section 27) Agreement in restraint of legal proceedings (section 28) Uncertain agreement (section 29) Wagering agreement (section 29) Agreement to do an impossible Act (section 56). Contingent Contracts ( S 31-36) A contingent Contract is a contract to do or not to do something , if some event collateral to such contract does or does not happens. Illustration : - A contract to pay Rs. 10,000/- if Bs house is burnt. This is contingent contract. 1. A makes a contract with B to sell a horse to B at a specified price if C , to whom the horse has been offered refused to buy . 2. A agree to pay B A sum of money if a certain ship dosed not return. The ship is sunk. The Contract can be enforced when the ship sunk 3. A agrees to pay B Rs. 1000/- if two straight line should enclose a space. The agreement is void.

The Performance of Contracts A. Who must perform the promises The parties to a contract must perform or offer to perform their respective promises unless such performance is dispensed with or excused under the provision of this Act or any other law. Thus a party is released from performance his part of contract by law e.g. an insolvent from paying his debt. Illustration : - A promises to deliver the goods to B on a certain day on payment of Rs. 1,000/- .A dies before delivering the goods. As representative is bound to delivery the goods to B. B. Tender ( Offer ) of Performance ( Effect of refusal to accept Tender of Performance) C. Anticipatory Breach of Contract Meaning breach of contract is its breach or repudiation before the time fixed for performance has arrived. It can be caused by 1. Anticipatory breach by repudiation and 2. by impossibility of performance brought about by the act of one of the parties. Example : X agrees to sell certain goods to Y , delivery to be given at the end of the month. The very next day, X writes to Y and says that he will not deliver the goods . Y replies that he does not accepts X s wrongful repudiation of the

contract. At the end of the month , X delivery the goods to Y who refuses to accept it. X sue Y for breach of contract. ( X will succeed notwithstanding his previous repudiation.)

Discharge of Contract :1. By performance 2. where performance is dispensed with or excused 3. by refusing tender of performance 4. by one party refusing to perform 5. by the act becoming impossible or unlawful 6. by novation resiccion or alteration of contract 7. by waiver 8. by accord and satisfaction 9. by rescission of voidable contract 10. by the promise failing to afford facilities for performance 11. by operation of law. Quasi Contracts ( S. 68-73) Certain Relations resembling those, created by contract. 1. Claim for necessaries supplied to person incapable of contracting, or on his account 2. Reimbursement of person paying money due by another in the payment of which he is interested 3. Obligation of person enjoying benefit of a non gratuitous act 4. Right and liabilities of finder of goods 5. Liabilities of person to whom money is paid or thing delivered by mistake or under coercion

Breach of Contract 1. Damages for the loss sustained 2. Decree for specific performance 3. injunction Indemnity and Guarantee 1. A contract of Indemnity is a contract by which one party promises to save the other from the loss caused to him by the conduct of the promise or any other person. A contract of guarantee is a contract to perform the promise or discharge the liability of a third person in case of his default. 2. In contract of indemnity there are two parties. But in contract of Guarantee there are three parties. 3. A contract of indemnity is for reimbursement of loss. A contract of guarantee s security of the creditors. Contract of Bailment A bailment is the delivery of gods by one person to another for some purpose upon a contract that they shall when the purpose is accomplished, be returned or otherwise disposed of according to the direction of the person delivering them. Lien & Pledge Lien gives a right to possession until the claim is satisfied. Pledge is a bailment of goods as security for a debt or for the performance of a promise.

Agent An Agent is person employed to do any act for another or to represent another in dealing with third persons. The person for whom such act is done or who is so represented is call the principal. 1.Special Agent 2. General Agent 3.Sub-agent 4. Co-agent