The Indian Contract Act, 1872

GENERAL
PREAMBLE-To define and amend the law relating to contracts. APPLICABILITY- The Act applies to the whole of India except the State of J & K.

DEFINITIONS
Proposal- Section 2(a) Promise A Proposal when accepted becomes a promise- Section 2(b )

Promisor & Promisee -Section 2(c)

Consideration-Something in return [quid pro quo]Section 2(d) Agreement-Every promise is an agreement-Section 2(e)

 Void Agreement- An agreement not enforceable by law- Section 2(g) Contract- An agreement enforceable by lawSection 2(h) Voidable Contract-An agreement enforceable at the option of one party to the contract-Section 2(i) Contract becoming void subsequently- A contract which ceases to be enforceable-Section 2(j)

DEFINITIONS[contd.]

CONTRACT
Meaning- A Contract is an agreement between two or more parties , enforceable by law, which confers rights & obligations on the contracting parties. Statutory Definition- An agreement enforceable by law- Section 2(h). Thus, a contract essentially consists of : (i) an agreement ; ie, an offer & acceptance, and (ii) a legal obligation enforceable by law

CONTRACT
An agreement is composed of two elementsoffer or proposal by one party, and its acceptance by the other. An agreement to go for a movie, being social in nature, & without any intention to create a legal obligation, is not enforceable by law, hence not a contract. Thus, all contracts are agreements, but all agreements are not contracts. Privity of Contract- A stranger to a contract has no remedy against the contracting parties.

Essentials of a Contract [Section 10]

(i) agreement; ie, offer and acceptance ; and, (ii) intention to create legal relations ; and, (iii) free consent ; and, (iv) capacity to contract ; and, (v) lawful consideration ; and, (vi) lawful object ; and, (vii) writing & registration ; and, (viii) not expressly declared void by the Act

Essentials of a Contract[contd.]
If any of the essentials is missing, the contract would be voidable, or the agreement would be void depending upon the legal provisions.

Kinds of Contracts
A -on the basis of Enforceability (i) valid contract (ii) voidable contract (iii) void contract a-supervening impossibility [section 56] b -subsequent illegality [section 56] (iv) unenforceable contract- for example a debt barred by the law of limitation

 B - on the basis of Mode of Creation (i) express contract (ii) implied contract (iii) quasi or constructive contract C - on the basis of Execution (i) executed contract both the parties have completely performed their obligations (ii) executory contract - both the parties are yet to perform their obligations in full or part

Kinds of Contracts[contd.]