Agreements In Restraint Of Legal Proceedings

Every agreement, -

(a) By which any party thereto is restricted absolutely from enforcing his rights under or in
respect of any contract, by the usual legal proceedings in the ordinary tribunals, or which
limits the time within which he may thus enforce his rights; or

(b) Which extinguishes the rights of any party thereto, or discharges any party thereto,
from any liability, under or in respect of any contract on the expiry of a specified period so as
to restrict any party from enforcing his rights, is void to that extent.







Agreement in Restraint of Trade
Every agreement, by which anyone is restrained from exercising a lawful profession, or trade or business
of any kind, is to that extent void.
In Case of Company A and B where two sugar manufacturers had entered into an agreement allocating
zones to procure sugar for meeting the needs of their respective factories and each of the manufacturers
under took not to draw any cane from the zones allotted to the other factory, it was held that the agreement
was in restraint to trade and therefore void.





Agreement void for uncertainty

Agreements, the meaning of which is not certain, or capable of being made certain, are void.

A agrees to sell to B "a hundred tons of oil". There is nothing whatever to show what kind of oil
was intended. The agreement is void for uncertainty.

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.
Illustration

A contracts to pay B Taka 10,000 if B's house is burnt. This is a contingent contract.