CONTRACTSCOPE AND ITS

KINDS

The law relating to contracts in

Pakistan is governed by Contract
Act, 1872.

It extends to the whole of

Pakistan; and it came into force on
1st September, 1872.

Scheme of Contract Act

General principles for all types of

contract (Sec 1-75)

Contracts of indemnity and
guarantee Section 124-147
Contracts of bailment and pledge

Section 148-181
Contract of Agency Section 182-238

Applicability of
Law of Contract

Applicability of Law of
Contract
Law applicable where
Parties belong to different
countries

Applicability of Law of
Contract

Law applicable where Parties belong

to different countries.
Where a contract is entered into in one
country and is to be performed in
another countryFirst presumption is
that the law of the country where the
contract is made shall be applicable.
Second presumption is that the law of
the country where the performance
is to take place shall be applicable.

Applicability of Law of
Contract
Law applicable where different
Laws in different Provinces:

The law of contract applicable in such

situation shall be the law of province in
which the contract was made.

Law of Contract and Trade

Usage

Introduction to the Uniform

Commercial Code
The UCC "fills in the gaps," providing controlling
contract terms where the contracting merchants
either didnt agree or just forgot to discuss the matter.
In many commercial transactions, the buyer and
seller only discuss how many goods, how much to
pay, and perhaps when delivery or payment is due. It
is only later, after problems arise, that merchants also
will discuss or argue about many more specific terms
such as: "Where will the goods be delivered?" or "Is
the buyer under any obligation if the goods are
slightly defective?"

UCC
The UCC often holds parties to "commonly
accepted practices" or "industry
standards." Only persons familiar with this
business should be held to these
standards.

Applicability of Law of Contract

Law applicable regarding

Trade Usage
Where parties enter into contracts

with full knowledge of the

commercial usage governing them,
they shall be bound by them.

Significant Features of Trade

Usage

Universal
Precise, Certain and Uniform
Fair, Reasonable and Equitable
Continuous
Not to be Illegal and Immoral

Significant Features of Trade

Usage
Universal
Must be universal It is so
universally practiced that
everybody in the particular trade
knows it or might know if he took
pains to acquire the information.

Significant Features of Trade

Usage
Precise, Certain and Uniform
Precise and certain as well as uniform
in application in particular trade and
business.
Must be fair, reasonable and
equitable
Continuous
It must be continuous in that it should
have existed without interruption as
controlling the subject-matter affected.

Significant Features of Trade

Usage
It

must not be illegal or

immoral or opposed to
public policy of the State.

CONTRACT ACT
DEFINITIONS & Scope

Contractdefined Sec
2(h)
An agreement enforceable by law

is a contract

Scope of Contract under sec 2(h)

To understand the definition of contract

we need to understand the following
definitions (concepts)
Proposal
Acceptance
Promise
Consideration
Agreement
Contract

Contracts
Proposaldefined

Sec

2(a)
When one person signifies to
another his willingness to do or to
abstain from doing any thing, with a
view to obtaining the assent of that
other to such act or abstinence, he
is said to make a proposal.

Scope of a Proposal under

sec 2(a)

Mere proposal / offer does not

constitute any liability.
Accepted offer leads to promise.
Invitation of quotations to
offer some orders does not
constitute a proposal, a contract
would come into force only
when invitee places an order
and inviter accepts the
same.

Scope of a Proposal under

sec 2(a)

Bids made at the time of

auction are just an offer and
contract would come into
force only when these bids
are accepted.

Promise

Defined as 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.

Scope of Consideration--Sec 2(d)

Definition: When at the desire of
the promisor the promisee or any
other person has done or
abstained from doing, does or
abstains from doing, or promises to
do or abstain from doing ,
something, such act or abstinence
or promise is called a consideration
for the promise.

Consideration

Each contract must have some

consideration, but need not be adequate.
Illegal consideration shall not be valid
consideration.
Doing something is an act and is called positive
consideration and not doing something is
called negative consideration.
Consideration may be an act which has been
done (Past), or is in progress (Present) or is
promised to be done in the future.
Consideration is not considered real and
competent if it is physically impossible, illegal,

Agreement

Defined as Every promise and every set of

promises, forming the consideration for
each other, is an agreement

A contract is an agreement, an agreement

is a promise and a promise is an accepted
proposal.
Two Types: Social & Legal. A contract is a
legal business agreement.

Difference between
Agreements and
CONTRACT
AGREEMENT
Formation: An offer and
Formation: An agreement
Contracts
acceptance makes an
and its enforceability make a
1.

1.

agreement.
2.Legal Oblig.: May or may not
create a legal obligation.
3.Scope: All agreements are
not contracts.
4.Binding: All agreements are
not binding on the concerned
parties.

contract.
2.Legal Oblig.: Creates a legal
obligation.
3.Scope: All contracts are
agreements.
4.Binding: Are all binding on
the concerned parties.

Essentials of Valid
Contract

ContractsEssentials
According to section 10 of Contract Act
1872;
All agreements are contracts if they are
made by the--Free Consent of parties competent to
contract,
for a lawful consideration and with a
lawful object, and are not hereby
expressly declared to be void

Essentials of Valid Contract

1. Offer and acceptance
2. Legal relationship
3. Legal consideration
4. Competent parties
5. Free consent of the parties

Essentials of Valid Contract

6. Lawful Object
7. Terms of agreement to be complete and

certain.
8. Possibility of performance.
9. Contract to be Registered & in Writing,

wherever required.
10.Contract Not Declared Void under the

Act.

Contracts
Essentials
The offer is the beginning part of an
agreement
in itself does not create a legal
Offer
& but
Acceptance
relationship. The acceptance of the offer
creates a legal relationship.
Offer has two parts:

Expression of ones willingness to do or abstain

from doing something.
2. Expression is made with the idea of getting
someone to agree to a purposed act or abstinence.
*The person making the offer is the offeror or promisor.
*The person to whom the offer is made is the offeree or
promisee.
1.

Essentials of a Valid
Offer

Express or Implied: In spoken words or

written form is an offer is expressed. Implied
means that it is apparent that a offer is made
by looking at the actions, conduct or
circumstances of the case.
2. Legal Relations: There must be an intent to
create a legal relationship (obligation).
3. Definite & Clear: The terms must be clear,
otherwise it will not create a binding contract.
An agreement to agree in future, is not a
contract.
1.

Essentials of a Valid Offer

Cont
4.
5.
6.
7.

8.
9.

Invitation to offer: Not making an offer but inviting

them to make an offer (ie.auction). (Example pg.18)
Specific or General Offer (Example pg.18)
Communication with offeree is a must. (Example pg.18)
Negative Condition: If you do not say anything by a
certain date I will assume that you agree. Not
allowed.
Conditions in Offer: All conditions must be agreed to
for a valid contract.
Cross Offers: Two parties make similar offers to each
other without knowledge of each other offer. This is
not a contract.

Offer must be
Distinguished from

An invitation to treat :
Where a party is initiating negotiations
he is said to have made an invitation to
treat. An invitation to treat cannot be
accepted to form a binding contract.
There are four types of invitation to treat:

Types of Invitation to
Treat

1. Auction sales
2. Advertisements
3. Exhibition of goods for sale
4. An invitation for tenders

Case
An advertisement of goods for sale is an
attempt to induce offers.
Partridge v Crittenden 1968
Mr. Partridge placed an advertisement
for Bramblefinch cocks, branblefinch
hens, 25s each.

Case Decision
A prosecution was brought against him
for offering for sale a brambling in
contravention of the Protection of Birds
Act 1954. The justices convicted
Partridge and he appealed.
Decision:
The conviction was quashed. Although
there had been a sale in contravention of
the Act, the prosecution could not rely on
the offence of offering for sale, as the
advertisement only constituted an invitation
to treat.

Case 2 & Decision

Fisher v Bell 1961
A shopkeeper was prosecuted for offering
for sale an offensive weapon by
exhibiting a flick knife in his shop
window.
Decision:
The display of an article with a price on
it in a shop window is merely an
invitation to treat.

Case 3
Pharmaceutical Society of Great Britain v Boots
Cash Chemists 1952
Certain drugs could only be sold under the
supervision of a registered pharmacist. The
claimant claimed this rule had been broken by
Boots who displayed these drugs in a self-service
shop. Boots contended that there was no sale until
a customer brought the goods to the cash desk
and offered to buy them. A registered pharmacist
was stationed at this point.

Case Decision
Decision:
The court found for Boots and
commented that if it were true that a
customer accepted an offer to sell by
removing goods from the shelf, he could
not then change his mind and put them
back as this would constitute breach of
contract.

Question?

Bianca goes into a shop and sees a

price label on a CD for 15. She takes
the CD to the checkout, but the
checkout operator tells her that the label
is misprinted and should read 20.
Bianca maintains that she only has to
pay 15. How would you describe the
price on the price label in terms of
contract law?

Answer

Display of goods for sale with a price

label is an invitation to treat (Fisher v
Bell 1961), that is an invitation to the
customer to make an offer which the
shop can either accept or reject.

Revocation/Termination of
an Offer
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

By sending a notice of revocation.

Lapse of time.
Failure to fulfill a condition.
Death or Insanity of Offeror.
Revocation by Offeree.
Counter offer: This creates a whole new offer, original offer is no
more valid.
Death or Insanity of Offeree.
Subsequent Illegality: Change in law makes it illegal.
Destruction of Subject Matter
Prescribed Manner: If the offeror details the manner of acceptance
and the offeree does not accept in that manner than the offer
terminates. The offeror can cancel the offer if he informs the
offeree in reasonable time. If the offeror does not inform, he will be
bound by such acceptance.

Case 1

Hyde v Wrench 1840

The defendant offered to sell property to
the claimant for 1,000 on 6 June. Two
days later, the claimant made a counteroffer of 950 which the defendant
rejected on 27 June. The claimant then
informed the defendant on 29 June that
he accepted the original offer of 1,000.

Decision 1

Decision:
The original offer of 1,000 had been
terminated by the counter-offer of 950.

Case 2

Byrne v Van Tienhoven 1880

The defendants were in Cardiff; the claimant in New
York. The sequence of events was as follows:
1 October Letter posted in Cardiff, offering to sell 1,000
boxes of tinplates.
8 October Letter of revocation of offer posted in cardiff.
11 October Letter of offer received in New York and
telegram of acceptance sent.
15 October Letter confirming acceptance posted in New
York.
20 October Letter of revocation received in New York.
The offeree had meanwhile resold the contract goods.

Decision 2

Decision:
The letter of revocation could not take
effect until received (20 October); it
could not revoke the contract made by
the telegram acceptance of the offer on
11 October

Essentials of Valid
Acceptance
1.
2.
3.
4.
5.
6.
7.

Acceptance by Offeree
Absolute & Unconditional.(Example pg.22)
Prescribed Manner. (Example pg.23)
Communication with Offeror.
Express: words spoken or written. Implied:
by conduct or action.
Acceptance must be made after offer, not
before.
Reasonable time.(Case by case if no time specified)

ContractsEssentials
Legal Relationship:
the agreement must lead to a legal
relationship between the parties.
The parties must have intention to
create legal relationship. Social
agreement does not create any
legal relationship, hence not a
contract enforceable by law.

ContractsEssentials
Legal Consideration:
According to sec 23 the consideration or
object of an agreement is lawful if it is not
forbidden by any law or not fraudulent or
does not cause injury to a person or
property or not immoral.

Essential of Valid
Consideration
1.

2.
3.
4.
5.
6.
7.

Desire of Promisor: The act or abstinence which forms the

consideration must be done at the desire of the promisor,
not a third party. (Example pg.29)
Promisee or other person: Consideration may move from
the promisee to another. (Example pg.29)
Act or Abstinence: Can be positive or negative
consideration.
Forbearance to Sue: Giving up ones legal right to sue is
valid consideration.
Inadequate consideration is valid if it is shown that it was
freely taken
Physically and Legally impossible consideration is not valid.
Consideration must be in clear and certain terms.

Exceptions to
Consideration
1.

Natural Love and Affection: A written agreement between parties

standing in near relation to each other. Must be:
a)
Contract in writing
b)
Contract is registered
c)
Contract made on account of natural love and affection.
d)
Near relationship between the two parties
2.

Voluntary Compensation: A promise to compensate, wholly or

partially, a person who has done a voluntary service for the other.
a) Services rendered voluntarily for the promisor.
b) Promisor must be in existence at the time services were
rendered.
c)
Intention should be to compensate the promisee.
d) Service must be legal.

Exceptions to
Consideration
3.

Time Barred Debt: A debt not claimed in three years from the due
date. Is an agreement made in writing and signed by the debtor to
pay wholly or in part a time-barred debt. Requirements:
a)
Debt must be time-barred.
b)
Promisor must be liable for the debt.
c)
Must be an express promise to pay a time-barred debt.
d)
Promise must be writing and signed by the debtor or his agent.
4.
5.
6.

Completed Gift
Contract of Agency: The agent may or may not charge
commission.
Remission by Promisee: If a creditor gives up a part of his
claim, there is no need for consideration. Also an extension to
an agreement does not need to be supported by consideration.

Contract Essentials-- Legal

Competence of Parties
Scope of Competent Parties
Parties to contract are required to be:
1. Of the age of majority: 18 or 21 if
guardian takes charge of minors
property.
2. Of sound mind
3. Not barred from entering into
contracts by the operation of law.

Nature of Minors
Agreement

An agreement with a minor is void from the beginning and any monies
passed on to the minor are not recoverable.
A minor, upon reaching age of majority can not ratify an agreement that was
made by him/her, when he/her was a minor, because a contract with a minor
is void from the beginning.
Even if a minor falsely claims to be of the age of majority, still the contract
would not be binding, but monies could be returned if the court compels the
minor, if the minor brings a suit against the other party.
A person who supplies necessaries to a minor or anyone whom the minor is
bound to support, can recover reasonable value of such goods from the
property of a minor.
If the minor already possesses necessaries at the time when it is supplied to
him/her than the supplier can not recover value of those necessaries.
A contract made by a guardian on behalf of the minor, made within the
guardians authority and for the benefit of the minor, is binding on the minor.
A minor can be a beneficiary of a contract but the minor can not bear any
obligation in that contract.

Person of Unsound Mind

A person is said to be of sound mind for the

purpose of making a contract if, at the time when
he makes it, he is capable of understanding it and
forming a rational judgment as to its effect upon
his interests. (Section 12)
Burden of proof: If a person is usually of sound
mind, the burden of proving he was of unsound
mind at the time of contract lies with the person
who is challenging the validity of the contract. If a
person is usually of unsound mind the burden of
proof lies with the person affirming the contract.

Disqualified Person
1.
2.
3.
4.
5.

Joint Stock Company

Diplomatic Agent (See example pg.45)
Alien Enemy: A citizen of a country at
war with Pakistan.
Insolvent: Regarding his property.
Convict: During sentence period.

Free Consent
Consent shall be treated as free if not
obtained by:

Coercion

Undue influence

Fraud

Misrepresentation

Coercion
Coercion

defined in sec 15
Coercion is the committing , or
threatening to commit, any act
forbidden by the Pakistan Penal
Code or the unlawful detaining ,
or threatening to detain, with the
intention of causing any person
to enter into an agreement.

Coercion
Scope of Coercion
Where something or end purpose
achieved by use of unlawful force or
achieved by threat of unlawful force
shall be coercion.
o Commit or Threat to Commit
o Unlawful detention / seizure or
confiscation of property shall amount to
coercion
o Threat to a Third party
o If suit is filed in Pakistan then the
Pakistan Penal code is applied

Effect of Coercion
The contract is voidable at the option of the party
whose consent is obtained by coercion.
When the aggrieved party decided to cancel the
contract, he/she must return any benefit received
from the other party.
The other party to whom money was paid and
anything given under coercion must be returned.
If the aggrieved party does not decide to cancel
the contract, then it is a valid contract.
* Burden is on party wishing to cancel the
contract because of coercion.

Free Consent - Undue Influence

Conditions for claiming Exercise of

Undue influence
Position of dominance (Example pg.49)
Fiduciary relation between the parties
(relation of trust and confidence) (Example
pg.50)

Actual use or exercise of the influence

Free Consent - Undue Influence

Undue Influence Some Scenarios:
Employer and Employee
Counsel and Client
Creditor and Debtor
Burden of Proof ---is on the dominating person. He
must disprove Undue Influence by arguing that:
The facts were fully disclosed
The price was enough
The dominated party was in a place to receive
independent advice
The dominated party gave his/her free consent.

Difference between
Coercion & Undue
Influence
Coercion

Nature
Coercion is a physical threat to party or person.
Illegal & Unfair
Doing or threatening to do an illegal act.
Penal Action
Penal action taken against guilty party.
Parties
Coercion maybe against the party to the agreement or a
third party.
Relationship
No specific relationship between parties is required.
Refund or Benefit
Aggrieved party has to refund benefit received from the
other party.
Effect
Contract is voidable at the option of the aggrieved party.
Punishment
Involves criminal liability.

Undue Influence

Nature
Undue influence is a mental or moral threat.
Illegal & Unfair
Act may not be illegal just unfair.
Penal Action
No penal action taken.
Parties
Influence applied on the party to the agreement.
Relationship
There must be a specific relationship between the
parties.
Refund or Benefit
The court may require the aggrieved party to refund
benefit received from the other party.
Effect
The contract is voidable or the court may cancel or
enforce it in a modified form.
Punishment
Does not involve criminal liability.

Fraud
Fraud as defined in Section 17:

Fraud means and includes any of

the following acts committed by a
party to a contract, or with his
connivance, or by his agent, with
intent to deceive another party
thereto or his agent, or to induce
him to enter into the contract:--

Fraud
(1) the suggestion, as a fact, of that
which is not true, by one who does
not believe it to be true;
(2) the active concealment of a fact
by one having knowledge or belief of
the fact;
(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.

Types of Fraud
1.
2.

3.

4.
5.

False Statement: made intentionally.

Active Concealment: concealing material facts,
essential to the contract, that he is under
obligation to disclose. (Example pg.54)
Intentional Non-Performance: enters into a
contract with no intention of performing his part or
promise. (Example pg.54)
Intention to Deceive: includes all cases not
covered by other clauses.
Act or Omission: In certain cases it is obligatory
to disclose relevant facts to the other party
(Transfer of Property Act) (Example pg.54)

Essentials of Fraud
1.
2.
3.
4.
5.
6.
7.
8.
9.

The representation must be false.

The representation must relate to a fact.
The representation was made to induce the other party to contract.
The representation was made with the knowledge of its being
false.
The representation was made before the formation of the contract.
The other party must have relied on the representation.
The fraud must be committed by a party to the contract or his
agent.
The other party was deceived by the fraud.
The other party must have sufferred a loss.

Effect of Fraud
The aggrieved party can:
1.Cancel the contract.
2.Avoid the performance of the contract.
3.Ask for specific performance of contract.
4.Demand his position be restored to the
one that existed before the fraud.
5.Sue for damages.

Misrepresentation
Misrepresentation

defined in section

18:
Misrepresentation means and
includes
(1) the positive assertion, in a
manner not warranted by the
information of the person making it, of
that which is not true, though he
believes it to be true (Example pg.57);

Misrepresentation
(2) any breach of duty which, without an

intent to deceive, gains 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 (Example pg.57);
( 3) causing, however innocently, a party to
an agreement to make a mistake as to
the substance of the thing which is the
subject of the agreement (Example pg.57).

Difference Between
Fraud &
Misrepresentation
FRAUD

Intention
Intention is to deceive the other party.
Belief
Knows the statement is untrue.
Damages
Aggrieved party can avoid contract
and claim damages.
Offence
Is a criminal act.
Truth
Aggrieved party can avoid contract
even if it had the means to find out
the truth with ordinary diligence.

MISREPRESENTATION
Intention
No intention to deceive.
Belief
Believes statement to be true.
Damages
Can avoid contract but not claim
damages.
Offence
Is not a criminal act.
Truth
Cannot avoid contract if it had the
means to discover the truth with
ordinary diligence.

ContractsEssentials
Lawful Object:
The purpose of the agreement
should not be against the law. For
example: the contract in restraint
of trade shall not be valid contract
under section 27 of Contract Act.

Kind of Contracts

ContractsKind
Valid contract ( Already
Discussed)
ii.
Voidable contract
iii.
Void contract
iv.
Unenforceable contract
v.
Express contract
vi.
Implied contract
vii.
Executed contract
viii.
Executory contract
ix.
Contingent Contract
i.

ContractsKind
Voidable Contract
According to section 2(i):

An agreement which is enforceable by

law at the option of one or more of the
parties thereto, but not at the option of
the other or others, is a Voidable
contract.

ContractsKind
Voidable Contract:

A contract becomes voidable in the

following situations:
Consent not free
Promisor prevented from performance

Void Contract

Section 2 (g): An agreement not

enforceable by law is said to be void.
According to section 2 (j):

A contract which ceases to be

enforceable by law becomes void
when it ceases to be enforceable

Void Contract
Situations of void contract
Impossibility of performance sec

56
Legal contract may became void
due to some illegality afterwards.
Revocation of a voidable contract
by the party at whose option, the
contract is avoidable becomes
void contract

Void Agreement
Agreements expressly declared

void
Agreement in restraint of marriage
(Example pg.66)

Agreements in restraint of trade ( sec

27)
Agreements in restraint of legal
proceedings (sec 28) (Example pg.68)
Uncertain agreements (sec 29)
Wagering agreements (sec 30)

Unenforceable Contracts
Such contracts are unenforceable
before a court of law due to some
technical defects such as nondeposit of court fee, submission
of unsigned documents, absence
of writing, wherever writing
required, absence of registration,
wherever required under law. On
removal of these discrepancies, the
contract becomes enforceable.

Express contract and Implied

contract
Express contract and Implied
contract: Sec 9
Promises, express and implied. In
so far as the proposal or acceptance
of any promise is made in words,
the promise is said to be express.
In so far as such proposal or
acceptance is made otherwise
than in words, the promise is said
to be implied.

Kind of Contracts
Executed

contract:
Such contracts are those where
counter parties have completely
performed their respective
obligations under the contract.
Executory contract:
In such contracts both parties
are yet to perform their
obligations under the contract.

Contingent Contract Sec

31

A contingent contract is a contract to do or

not to do something, if some event, collateral
to such contract, does or does not happen.

ILLUSTRATIONS:

M/S ABC insurance company contracts with

Mr. Z to pay Rupees 500,000 if his car is lifted
by thieves.
Contract between the client and his counsel
regarding payment of agreed professional fee
if the suit turns out to be successful.

Contingent Contract
Scope

of Contingent contract
Contingency to be collateral (connected) to the
contract.
Contingency to be condition precedent. The event
must occur for the performance of the contract.
Contingent contract leads to absolute obligations
and enforceable in the following circumstances:
o On happening of the event or
o On fulfillment of condition stipulated.

Modes of Discharge of
Contract
A

contract shall be treated to have been

discharged:
By Performance
By Impossibility of performance (e.g.

destruction of the subject matter)

By Agreement of parties
By Operation of law (e.g. insolvency or
merger)
By Breach of Contract (if one party
breaches the contract the other party is

Quasi (Constructive)
Contracts

Arises under some special

circumstances. It is an obligation
imposed by law upon a person for the
benefit of another even in the absence
of a contract. Based on the principles of
equity and justice.

Quasi Contracts
1.
2.
3.
4.
5.

It is imposed by law and does not arise

under any agreement.
It is a promise of the party which is the basis
of a contract.
The right under it is always a monetary
benefit.
The right under it is available against a
specific person(s).
A suit of its breach may be filed similar to a
contract.

Examples of Quasi
Contracts
1.

2.

3.
4.
5.

Supply of Necessaries: Where a person is legally

bound to provide for another person (mentally
handicapped individual) the necessities of life, he/she
is entitled to compensation from the property of such
individual.
Payment by Interested Individual: A person who
makes a payment for another that is legally bound to
pay, is entitled to compensation.
Compensation for Non-Gratuitous Acts
Finder of Goods (Example pg.77)
Mistake or Under Coercion: makes payment or
delivers a good by mistake can get back that item.

Breach of Contract
Remedies for Breach of Contract
1. Suit for damages: Sec 73
2. Suit for specific performance (sec.12 to20 0f Specific
Relief Act, 1877)

3. Suit for Injunction

Remedies for breach of contract

1.

Suit for damages: Sec 73

--damages are meant to restore the
aggrieved party to the position he would
have been if the agreement would have
been performed and damage suffered is
compensated by way of monetary
award. In case of breach of contract the
aggrieved party has a right to file suit for
damages

Remedies for breach of contract

i.

Kinds of damages:
Liquidated damages
--section 74 stipulates that if parties to a
contract have mentioned the amount of
damages for the breach at the time of
entering into contract, such damages
shall be recoverable and these will be
called as liquidated damages, liquidated
damages also signify a fair and
reasonable estimate of loss which a party
may suffer due to breach of contract.

contract

Kinds of damages:
ii. Nominal damages:
--The court may under its discretion
allow nominal damages even in a case
where a person has not suffered any
financial losses but in recognition of his
right to compel the other party for
performance under the contract. Such
damage is usually concerned with nonpecuniary losses which are not easy to
ascertain.

contract

Kinds of damages:
ii. Nominal damages:
For instance an injury to ones
reputation,
in defamation, the pain and the
sufferings are the damages in such
cases which are difficult to be
ascertained in money terms so court
can award nominal or general damages
to the injured party/ aggrieved party.

Remedies for breach of contract

2. Suit

for specific performance

In certain cases where damages are not
preferable option as these may not provide
adequate remedy, the court may direct the party in
default to fulfill the contract. The aggrieved party
has the right to file a suit for specific
performance.

Remedies for breach of

contract
3. Suit for Injunction
A court order by which an individual
is required to perform, or is
restrained from performing a
particular act.