Name: Mirza Raqeem Ahmad (21-10503)

Business Law

Section 1:
a) It would be a unilateral contract as the teacher made an offer to students and there
was a reward if offer was completed. A unilateral contract requires that only one
party make a promise that is open and available to anyone who performs the
required action, like collecting the reward of a signed book in this case!
b) There is a contract because In a unilateral contract, only the offeror has an
obligation. So Daniel even though being unaware of the offer made has still fulfilled
and performed in accordance to offer made so the unilateral contract stands and
Daniel is eligible and entitled to receive the signed book from the teacher because
the offer wasn’t revoked on Monday!
c) There is a contract because there was implied acceptance through his conduct of
riding his bicycle on Saturday the day before the weekend!
d) Consideration would be of the copy of the book.
e) There was no adequate consideration in the contract hence it was never a valid
contract and thus there was no breach of contract.
f) 16 years of age is not enough to come under a contract. Daniel is a minor and
contract with a minor is automatically void. So there is no breach of contract from
daniel’s side.
g) An agent or representative of a promisor can perform on behalf of the the promisor
but only if the promise being performed does not require a specialized skillset that
only the promisor has. This is a PROVISION OF CONTRACT LAW. However, the
signature promised to Daniel was of the head but instead what Daniel got was a
forged signature by his assistant which is an unlawful act. So Daniel can get out of
the contract because he is the aggrieved party in this case.
h) Remedies available to Daniel are that because there has been a breach of contract by
the Promisor (Head) and Daniel can choose to rescind his part of the contract. He
can also go the court to sue for damages and he can try for specific performance
through court.
2)

a) Yes, there is a transfer of goods in reference to a barter contract (Horse and Car)
b) It is called Bailment. Because the car was given to get serviced and it was to be
returned back.
c) No, he cannot because it has to be returned.
d) Mortgage
e) Babar can sell his car if the loan taken from him by Ahmad is not returned. To get
his compensation back.
f) Sale of Goods contract.
g) It is a sale because the act of transference of the car has taken place, Ahmad HAS
BOUGHT THE CAR, he is not in the process of doing so.
h) Afzal was in the legal capacity to make agreements to sell the cars.
i) Because Afzal was not given the greenlight by Babar to make a sale. Afzal had no legal
capacity to make the sale BUT ONLY HAD LEGAL CAPACITY TO MAKE
AGREEMENTS OF SALE. He was not given authoritarian status and he did not hold
ownership rights to the cars.
Section 3:

 A negotiable instrument is basically a document or a contract that ensures that a specific

person is given monetary compensation. It is transferable and also a signed document.
The recipient has to be mentioned by name in the negotiable instrument for him to cash it
in let that be in the future or on-demand. Requirements are as follows:
 It has to be in writing.
 It must be signed by the person who’s giving the negotiable instrument.
 It must be unconditional.
 It must have a specific and fixed amount of money.
 It has to be either payable on-demand or at a given time mentioned in writing.
 The bearer must be the recipient unless the negotiable instrument is a check in
that case its payable to whoever the check is written to (through prior consensus)
 There are 2 major types of negotiable instruments:

An order to pay (drafts and checks): order to pay are the category encompassing
negotiable checks or drafts that are paid to the holder identified by the giver of the
negotiable instrument. It is mostly in the terms of money!

Promises to pay (promissory notes): This is the type in which there are conditions
mentioned which have to be fulfilled In order for the payment to be paid. It is basically
used when a debt has to be repaid with conditions such as interest rate included and in
what time does it has to be paid by.

Differences btw the two:

 A promise to pay has two parties - the person who writes the document and the
person who receives the money.
 But in an order to pay there are three parties - the person who creates it, the
person who is liable to pay, and the person who receives the money.
 In an order to pay, the person generating the document is not paying. However,
in a promise to pay the person generating the document is paying.
  The person who receives the promise to pay is entitled to receive the money.
But, the person who receives the order to pay, is actually supposed to pay the
money.
3) Holder in due course is someone who accepts a negotiable instrument in without
reason to doubt its legitimacy. Whereas a simple holder is someond entitled in his own
name to the possession of a negotiable instrument and to receive the amount due on it.

Differences btw the two:

 A person who legally obtains the negotiable instrument, with his name entitled on it,
to receive the payment from the other party is called the holder of a negotiable
instrument. A person who acquires the negotiable instrument for some
consideration, whose payment is still due, is called holder in due course.

 A holder can possess negotiable instrument, even without consideration. But a

holder in due course cannot.

 A holder cannot sue all the prior parties whereas a holder in due course, has the right
to sue all the prior parties for payment. Because there was consideration involved!

 A holder may or may not have obtained the instrument in good faith. On the other
hand, the holder in due course is unaware whether the instrument was given in good
faith or not, he’s just a possessor.

 A holder in due course can sue and claim more than a simple holder. A holder in due
course as against a holder enjoys more privileges in many situations like in the case
of fictitious bills and so on.

 To become a holder in due course he first has to become a holder in other words a
person can become a holder, before or after the maturity of the negotiable
instrument. A person can become a holder in due course as the name suggests only
before the maturity of the negotiable instrument, because it is an instrument that is
there for the future.
4) Parties involved in a Negotiable Instrument:

Drawer: The person who writes the order to pay is called a drawer.

Maker: The person who writes the promise to pay is called the maker.
Drawee: A person to whom the bill of exchange or cheque is drawn or written is called
drawee.

Payee: The specified person with the instrument, to the payment of money is directed or on
whom an order of the payment of money is directed to is called a payee as he’s getting the
money at the end.

Acceptor: When drawee of a bill of exchange informs the holder or any person on behalf
drawee is called acceptor.