Ankit

Tiwari Dhruv Mishra Archit Kumar Sachin Shukla Jyoti Singh

Section 2(h) An agreement enforceable by law is a contract. Thus, Contract = Agreement + Enforceability at Law

 Section

2(e)
Promise/(s)

Promise/(s)

= Agreement
(in exchange for)

Section 2(b) Promise = Proposal/Offer + Acceptance

Proposal?
Section 2(a) Expression of willingness With a view to seek the assent of the other Thus, mere expression of willingness doesnt constitute offer/proposal.

Section 2(b) Giving of assent to the proposal. Enforceability by Law Agreements which are not enforceable Illegal/unlawful agreements, e.g., to smuggle/to kill Social Agreements (Balfour vs. Balfour)

e.g. Agreement with or by a minor Agreement in restraint of trade Marriage brokerage contract Wagering/Betting Agreements

From the point of view of Enforceability

Void Voidable

Valid

 Void

Agreement i.e., void-ab-initio i.e. unenforceable from the very beginning Becomes void (Void Contract) Voidable i.e., void + able i.e., capable of being declared void (unenforceable) at the option of one of the parties to the contract but not at the option of the other.

1. 2.

3.

Section 10 To be a valid contract, it must satisfy the following: Offer and Acceptance Consensus-ad-idem (Meeting of minds) i.e., persons must agree to the same thing in the same sense and at the same time. Intention to create legal relationship as against social relationship or illegal/unlawful relationship.

4.

Free and Genuine Consent, i.e., free from

5. 6.

coercion undue influence fraud misrepresentation mistake

Parties competent to contract Lawful consideration and object, i.e., something in return and that must be lawful.

(Object and Consideration usually overlap. However, there may be difference at times e.g., object may be to kill competition and for that purpose in view, a senior manager of the competitor may be paid a certain amount to give unrealistically high quotation.) Here: Object is to kill competition. Consideration is : (i) payment of money (ii) giving high quotations

7.
8.

Agreement not declared void. Certainty of Meaning: e.g. sale and purchase of 100 tonnes of oil. But which oil? Thus, agreement being uncertain not valid. But, if the seller deals only in one kind of oil and one variety, then it shall be valid since it is capable of being made certain.

Possibility of performance: Impossibility whether known to the parties or not, renders a contract invalid. 10. Necessary legal formalities: e.g. sale-deed of immovable property.
9.

Void Agreement Illegal Agreement 1. Unenforceable 1. Unenforceable 2. Not Punishable 2. Punishable (fine or imprisonment or 3. Collateral both) transactions unaffected. 3. Collateral transactions are also void.

Specific

Offer:

made

to a specified person or a group of persons. can be accepted only by the person to whom made.

Thus, if offer is addressed to A, B cannot accept it. Case Law: Boulton vs. Jones

General

Offer:

which

is not a specific offer. made to the world at large. can be accepted by anyone by complying with the terms of the offer.
Case

Law: Carlill vs. Carbolic Smoke Ball Co.

Illustrations

of Invitation to Offer:

Prospectus

issued by a college. Prospectus issued by a company. Invitation of bids in an auction. Price-catalogues, price lists, quotations Display of goods with a price-tag in a shop window.

Examples: Dry cleaners receipt, couriers receipt, shipment receipt, insurance policy, etc. Binding if communicated or attention drawn to the fact that there are certain special terms and conditions. Not binding if attention is not drawn and the other party not aware of.

 Cross

Offers Identical offers cross each other and none of the parties is aware of the same. Doesnt result in a contract unless one of them is accepted. Counter Offer Instead of accepting an offer, the offeree makes a counter offer, i.e., accepts the same subject to certain conditions or qualification.

Communication

of Offer is complete when the offeree has the knowledge of the same. Communication of Acceptance It has two aspects, viz., As against the proposer As against the acceptor

 Communication

is complete as soon as a duly addressed letter of acceptance is put into the course of transmission. Whether the same reaches the proposer or not.

As against the acceptor

Communication

is complete only when the proposer has received the letter and learnt the contents thereof.

Communication

of revocation (of offer or acceptance) is complete:

As

against the person who makes it when it is put into the course of transmission. As against the person to whom it is made, when it comes to his knowledge.

Comparing

offer to a train of gunpowder and acceptance to a lighted match stick How far correct? William Ansons observation though valid in the English context doesnt hold good in India since in India acceptance is revocable.

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