Raj Pillai has a business agreement with a local company to

supply 50,000 kilogram of wheat which is distributed to

hotels. The local company did not supply for one month so
he bought from another company

Section 40 CA 1950 states that where one party

ceases to perform the contract.The contract can put
to end.
The First limb of Section 74 (1) Contract Act
1950
The first limb of of S 74 (1) provides for
compensation of losses which naturally arose in
the usual cause of things. This would refer to
losses which are normally expected from a breach
in question. In Illustration.
a) Loss suffered by B a purchase due to add, the A
the sellers refusal to sell the difference between
the markets price for which B.
 The second limb of section 74 (1)
Contract Act 1950

The second limb of section 74 (1) C.A 1950 is

for loss which the parties knew when they
made the contract, to be likely the result
from breach of it. Illustration (1) is similar to
the fact in victories country.
The specific Relief Act Provides for specific
performance and injunction.
 Application of Legal
Principle
Based on the facts contractor failed to perform
the contract despite the fact be increased the
contract price by 30% therefore section 40 C.A
1950
This is condition which entities Raj Pillai to
terminate the contract.It could be argued that
is not warranty either innominate terms.
Raj Pillai suffered a loss and therefore it is
appropriate to claim normal damages.central
to the argument it is not possible to claim
under the second limb.
Raj Pillai and the contractor should have
known the purpose of renovation.
 Conclusion

In conclusion Raj Pillai can only claim

normal damages because of the issue to
be addressed about breach of contract
and whether Raj Pillai can claim
damage.
 Raj has incorporated a
private company in 2016
The companies Act 2016 particularly section 9 of C.A
2016 provide one member can incorporate a private
company section 31 C.A 2016 provides it is not
necessary to have a constitution of a private company.
It is advisable not to have the constitution of company
as sector 31 C.A 2016 provide that a company, other
than company limited by guarantee may or may not
have a constitution literally means that a private
company if it wishes may have the constitution.
Company Limited guarantee

A company limited by guarantee needs to have

the constitution. The object clause should state
the purpose such providing education or
religious or spiritual or medical.

The aforesaid company once incorporated

could apply to Minister to remove Bhd.
Concept of legal personality

Incorporation of a company
A company is a corporation
It has succession
It can be sued and being sued
 Example Cases Soloman
Vs Aron Soloman
Leather boots manufacture- Aron
Formed a company limited by shares
Six shares- wife, children, himself
To cover the balance amount borrowed
from debenture holder
High court ( Aron had to pay)
Ort of appeal (Same)
House of lord company has to settle