Professional Documents
Culture Documents
Contract
Contract
Topic: -
Doctor
Mrs. Ishita Chatterjee
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ACKNOWLEDGEMENT
With profound gratitude and sense of indebtedness I place on record my sincerest thanks to Mrs.
Ishita Chaterjee, Research Assistant in Law, Indian Institute of Legal Studies, for his guidance,
sound advice and affectionate attitude during the course of the study work.
There is no hesitation in saying that she molded raw clay into whatever we are through his
incessant efforts and keen interest shown throughout the academic pursuit. It is due to his patient
guidance that I have been able to complete the task.
I would also thank the Indian Institute of Legal Studies Library for the wealth of information
therein. I express my regards to the Library staff for cooperating and making available the books
for this project research paper.
Finally, I thank my beloved parents for supporting me morally and guiding me throughout the
project work.
Date:
_____________________
BONNY BASAK
LL.B (1st Semester) Roll No: 61
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TABLE OF CONTENTS
___________________________________________________________
Research
Methodology.
...3 - 4
A. Aims
and
Objectives..
3
B. Statement
of
Problem.
..3
C. Research
Hypothesis.
.3
D. Research
Questions..
..3
E. Methodology
of
Research.
.4
F. Scope
and
Limitations..
4
G. Review of
Literature..
.4
H. Mode
of
Citation.
4
Table
of
Cases
..5
Chapter
1:
Introduction
6-7
Chapter2: CONSIDERATION ONLY AT THE DESIRE OF THE PROMISOR...
8
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BIBLIOGRAPHY
16
RESEARCH METHODOLOGY
___________________________________________________________
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B. STATEMENT OF PROBLEM
Despite the laws and Acts, the current rules do not give an equal chance to access and
flourish. Consideration having various provisions which can be interpreted in the light of
judiciary for benefit to the society is being used in a different way and the language of the
provision if not understood properly leads to a whole different perception which leads us the
other way.
C. RESEARCH HYPOTHESIS
Research in common parlance refers to a search for knowledge. It is an original contribution to
the existing stock of knowledge making for its advancement. It is the pursuit of truth with the
help of study, observation, comparison and experiment. In short, the search for knowledge
through objective and systematic method of finding solution to a problem is research. This
research work is an attempt to distill lessons from the Consideration and the experience,
particularly the provisions relating to the principle of good faith and duty of disclosure in
Consideration.
D. RESEARCH QUESTIONS
Based on the statement of problem and research hypothesis aforementioned, the following
research questions have been formulated:
1. Without Consideration Contract is valid or not?
2. For create a Contract what are the main essentials of Consideration is needed
3. Elucidate some exceptions when agreement without Consideration is valid?
4. Debt due by whom in Consideration?
E. METHODOLOGY OF RESEARCH
Methodology implies more than simply the methods the researcher used to collect data.
It is often necessary to include a consideration of the concepts and theories which
underlie the methods. The methodology opted for the study on the topic is Analytical and
Doctrinal. Doctrinal research in law field indicates arranging, ordering and analysis of the
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legal structure, legal frame work and case laws by extensive surveying of legal literature
but without any field work.
G. REVIEW OF LITERATURE
The researcher while writing this project has taken recourse to various primary and secondary
sources. Primary sources would include various laws. Secondary sources would include books
and articles, reports and websites.
H. MODE OF CITATION
A Blue Book system of citation has been adopted throughout the project.
TABLE OF CASES
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Chapter 1
Introduction
The mere fact of agreement alone does not make a contract. Both parties to the contract
must provide consideration if they wish to sue on the contract. This means that each side must
promise to give or do something for the other. (Note: if a contract is made by deed, then
consideration is not needed.)
For example, if one party, A (the promisor) promises to mow the lawn of another, B (the
promisee), A's promise will only be enforceable by B as a contract if B has provided
consideration. The consideration from B might normally take the form of a payment of money
but could consist of some other service to which A might agree. Further, the promise of a money
payment or service in the future is just as sufficient a consideration as payment itself or the actual
rendering of the service. Thus the promisee has to give something in return for the promise of the
promisor in order to convert a bare promise made in his favour into a binding contract.
Presence of consideration is one of the essentials of a valid contract. Subject to
certain exceptions, the general rule in India is that an agreement without consideration is void.
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Consideration means something in return for the promise. It may be either some benefit
conferred on one party or some detriment suffered by the other.
In the words of Lush J. In Curie Vs. Misa (1875) A valuable consideration in the
sense of the law may consist either in some right, interest, profit or benefit accruing to one party,
or some forbearance, detriment, loss or responsibility given, suffered or undertaken by the other.
Consideration:
It is quid pro quo i.e. something in return
It is the price of promise
X aggress to sell his Watch set to y for Rs. 20000. Watch set is the Consideration of y and Rs.
20000 is the Consideration of X.
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Chapter-2
CONSIDERATION ONLY AT THE DESIRE OF THE PROMISOR1
It is essential that the consideration must have been given at the desire of the promisor, rather
According to Indian law consideration may be given by the promisee or any other person. In
India there is a possibility that the consideration for the promise may move not from the
promisee but a third person, who is not a party to the contract. The position can be explained by
referring to the case of Chinnaya Vs. Ramaya (1882) In this case A, an old lady, granted an
estate to her daughter (defendant) with a direction that the daughter should pay an annuity of Rs.
653/- to As brother (plaintiff). On the same day the defendant made a promise to the plaintiff
that she would pay the annuity as directed by A. The defendant failed to pay the stipulated sum.
In an action against her by the plaintiff she contended that since the plaintiff himself had
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.Dr.
CHAPTER-3
CONSIDERATION MAY BE PAST, EXECUTED OR EXECUTORY2
Indian Contract Act recognises three kinds of consideration, viz., Past, Executed and Executory.
When, in return for the promise, the promisee or other person :
1. Has done or abstained from doing, then consideration is past.
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2.
Dr. R.k Bangia, Contract-I, Allahabad Law Agency, Sixth Edition, 2009 p. 77
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When one person makes a promise in exchange for the promise by the other side,
the performance of the obligation by each side to be made subsequent to the making of
the contract, the consideration is known as Executory.
For example, A agrees to supply certain goods to B after a week, and B agrees to
pay for them at a future date, this is a case of Executory consideration.
Consideration need not be adequate
A contract which is supported by consideration is valid irrespective of the fact that
the consideration is inadequate. According to Explanation 2 section 25:
An
agreement to which the consent of the promisor is freely given is not void merely because
the consideration is inadequate; but the inadequacy of the consideration may be taken
into account by Court in determining the question whether the consent of the promisor
was freely given.
Consideration must be real
Although it is not necessary that consideration should be adequate, it is, however,
necessary that it should be real and should not be unsubstantial. Promise not to bore the
promisor is not enough to constitute consideration. In White Vs. Bluett (1853) a son
used to complain to his father that his brothers had been given more property than him.
The father promised that he would release the son from a debt if the latter promised
stopped complaining. After the fathers death an action was brought by the executors to
recover the debt. It was held that the promise by the son not to bore his father with
complaints in future did not constitute good consideration for the fathers promise to
release him, and, therefore, the son continued to be liable for the debt.
CHAPTER-4
Exceptions when agreement without consideration is valid.3
Section 25, as a general rule declares, that an agreement without consideration is void.
The section, however, mentions three exceptions, when there is no need of any consideration for
the validity of the contract. The provision is as under :
An agreement made without consideration is void unless
(1) It is expressed in writing and registered under the law for the time being in force for
registration of documents and is made on account of natural love and affection between parties
standing in a near relation to each other : or unless
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(2) It is a promise to compensate , wholly or in part, a person who has voluntarily done
something for the promisor, or something which the promisor was legally compellable to do ; or
unless
Promise due to natural love and affection :When the promise is made in favour of a near relation on account of natural love and affection,
the same is valid even though there was no consideration for such a promise. The following
requirements have got to be satisfied in order that the case is covered under this exception.
1.The parties to the agreement must be standing in a near relationship to each other.
2.The promise should be made by one party out of natural love and affection for the
other.
3.The promise should be in writing, and
4.The agreement is registered.
The parties should be nearly related to one another in such an agreement. What is near
relationship has neither been defined in the Act, nor in any judicial pronouncement. But from the
various decided cases it appears that it will cover blood relations or those related through
marriage, but would not include those relations which are not near, but only remotely entitled
to inherit.
3.
.Dr.
In Rajlucky Dabee Vs. Bhootnath Mookerjee (1900) it has been held that relations
between the two parties does not necessarily imply natural love and affection between them. In
this case after lot of disagreements and quarrels between a Hindu husband and his wife they
decided to live apart. At this stage the husband executed a registered document in favour of the
wife whereby he agreed to pay for her separate residence and maintenance. In that agreement
mention was also made about quarrels and disagreements between the two. It was held that from
the recitals in the document it was apparent that the document had been executed not because of
natural love and affection between the parties but because of the absence of it, and therefore the
wife was not entitled to recover the sums mentioned in the document.
It is further necessary that the agreement should be in writing and registered under the law
relating to registration of documents
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Compensation for past voluntary services: When something has been done at the
desire of the promisor, that constitutes a good consideration in respect of a subsequent promise to
compensate for what has already been done. The second exception to Section 25 covers cases
where a person without the knowledge of the promisor, or otherwise than at his request does the
latter some service, and the promisor undertakes to recompense him for it. The promise to
compensate, though without consideration, is binding because of this exception. The exception
also covers a situation where the promise is for doing something voluntarily which the
promisor was legally compellable to do. Thus, when A finds Bs purse and gives it to him and
then B promises to pay A Rs. 50, or, A supports Bs infant son and B promises to pay As
expenses in so doing, there is valid contract in each case although the promisors act was a
voluntary one.
Promise to pay a time barred debt: Another situation when an agreement is a valid
contract even without any consideration is a promise to pay a time-barred debt. Section 25 (3)
requires the following essentials to be satisfied in such a case.
1. The promise must be to pay wholly or in part a time-barred debt, i.e. a debt of which the
creditor might have enforced payment but for the law for the limitation of suits.
2. The promise must be in writing and signed by the person to be charged therewith, or his duly
authorised agent.
CHAPTER-5
Debt due by whom? 4
In Pestonji Vs. Bai Meherbai (1928) the Bombay High Court has expressed the view that under
this exception that the promise should be to pay time-barred debt due from the promisor, and not
a promise to pay time-barred debts due from other persons.
Section 25 (3), it may be further noted, permits a promise to pay wholly or in part a time barred
debt. If a person promises to pay a portion of a barred debt, he can only be sued for that portion
alone and not for the whole debt. If, however, the promise to pay the whole debt is there then the
whole of the amount can be claimed. A owes B Rs. 1,000, but the debt is barred by limitation
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Act. A signs a written promise to pay B Rs. 500 on account of the debt. Under this contract A is
bound to pay Rs. 500.
There should be express promise:
The promise to pay the time-barred debt must be an express one and cannot be held to be
sufficient if the intention to pay is unexpressed and has to be gathered from a number of
circumstances.
In Appa Rao Vs. Suryaprakasa Rao (1900) the defendant wrote a letter duly signed by him to
the plaintiff after the debt had become time-barred mentioning the periods for which the rents
were due and also stating I shall send by the end of Vyaskha month. It was held that the
document contained the ingredients mentioned in Section 25 (3) and the defendant was entitled
to enforce his claim.
. Dr. R.k Bangia, Contract-I, Allahabad Law Agency, Sixth Edition, 2009 p. 96
CHAPTER-6
CONCLUSION
Contracts between school districts and its personnel must not only satisfy there
quirements of general contract law, but also must meet the requirements specified in state law
and administrative regulations. A contract may be defined as an agreement between two or
or more competent parties for legal consideration on a legal subject matter in the form required
by law. This definition includes five legal principles governing every valid contract: offer and
acceptance, competent parties, consideration, legal subject matter, and proper form.
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BIBLIOGRAPHY
A. PRIMARY SOURCES
I.
STATUTES:
i.
INDIAN STATUTES
-
Contract-I
B. SECONDARY SOURCES
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I. BOOKS
-
Dr. R.k Bangia, Contract-I, Allahabad Law Agency, Sixth Edition, 2009.