B.A & B.B.A.

, LLB,
Course Outline

Subject Name General Principles of Contract

Subject Credit 4

Subject Code CLAW 202

A contract is essential for any business transaction, ensuring that both parties to the
contract abide by the commonly established terms and conditions. They are the main
means by which, transactions are made and legal obligations voluntarily incurred.
Summary/ Law of contract will be in two papers for the course. While semester I will deal with
Overview the general principles of contract law, the second paper in the next semester will
focus on certain forms of specific contracts.

This course is designed to acquaint a student with the conceptual and operational
parameters of these various general principles of contractual relations. Specific
Aims enforcement of contract is an important aspect of the law of contracts. Analysis of
the kinds of contracts that can be specifically enforced and the methods of
enforcement forms a significant segment of this study

Instructor

Office Hours
 Core Learning Outcomes
Learning Outcomes Assessment Criteria
Sl. On completion of this course you should be To achieve the learning outcome you
No. able to: must demonstrate the ability to:
 To identify all the essential elements required
for formation of a valid contract.
 To determine whether a contract is void,
voidable or illegal based on factors such as
To participate in class discussion and
incompetent parties, absence of lawful
group exercises; and also required to
consideration, unlawful object, lack of free
actively engage in debates, which are
consent etc.
organized in the class.
1  To distinguish between void agreement and
illegal agreements and their consequences and
to determine valid discharge of contracts based
on performance of contingent contract,
reciprocal contract as well as analyse situations If teacher deems it necessary, class
where contract becomes impossible to perform participation may be taken into
or contract is altered or rescinded, performance consideration to award marks
is waived or modified.
 To analyse the remedies available in relations
which resemble contractual obligations and
further applicability of principle of remoteness
2
of damage for breach of contract.
 To apply remedies provided in Specific Relief
Act for enforcement of contract

The teaching methods will consist of formal lectures, power point presentations, case
Approach
study analysis, presentations and group discussions etc. as per the requirement of each
to Learning
Unit.
Assessment of this course divided between written examination and research project.
 Written Examination: Written examination component further divided into two
parts which consist of Mid Semester Examination (MSE) which will be held during
the semester and Semester End Examination (SEE). MSE of 45 marks for 2 hours,
the weightage of 15 percent of the total grade will be taken into consideration. The
students will receive the notification of the examination from the ASOL Dean’s
office. The Semester End Examination (SEE) which consists of 100 marks and the
Assessment
duration of 3 hours to answer the questions, out of which 50 percent weightage will
Strategy
be taken into consideration. The instructor will provide tips and technics to write
thematic and problem based answers during the class.
 Classroom Attendance (CA): Classroom attendance and participation comprises of
5 Marks based on your attendance and your participation in the classes marks will be
awarded.
 Written Project: During the second week of the teaching the teacher will assign a
title of the research project in consultation with specific student. Each student in the
 class is required to submit the full research paper of not less than 4000 words (which
carries 15 percent of the total grade). Specific date lines have been provided in the
academic, requested to find the specific dates for your submission. Each student is
expected to submit their research project work on or before the mentioned deadline
in the academic calendar. Penalties will be imposed to the late submission. If any
student is interested to work on their own topic chosen by them, they are encouraged
to do so, however, they have to get prior approval from the class teacher. Once the
class teacher approves the project then the work can be carried out on regular basis.
The project should be structured around the given topic incorporating therein the
importance of the topic, brief introduction, identifying the research problem,
reviewing the existing legal system, need to write object of the research study and
the scope along with methodology. Further you are required to provide with the
analytical review of the existing literature on the given topic and the specific
questions to be addressed. The class teacher will provide you with a template;
students will have to follow the template strictly. Non-compliance of the template
will attract the penalties. The project should be typed in Times New Roman 12 font
size with 2-point line spacing. The paragraphs should also be justified with normal
margin. Students are required to follow the OSCOLA format for the standard
citation. Project work must be free from plagiarism, you are required to provide with
proper citations in the footnote, and at the end of your project of work you are
required to give full list of select bibliography. If the work found to be a plagiarized
work, then it will be treated as a serious academic misconduct. Serious actions will
be taken against the student.
 Presentation and Viva: The Presentation and/or Viva-voce comprises of 10 percent
of the total grade where the students are required to give oral/presentation in the
class before the panel of teachers on the project which you have submitted, and
questions will be posed by the panel of teachers based upon the presentation.
 Case Study: Case Study consists of 5 Marks of the total marks, which generally
conducted during 4th or 5th week of teaching. Exact dates will be informed by the
teacher. Modalities of the case study can be discussed and agreed with the class.

Assessment Description of Weight Duration and Marks of

No
Method Assessment Method % Examination
1 DSA Written examination 15 1 hour 30 minutes and 50 Marks
2 AT Class attendance 5 Throughout the course
Case study/ 1. All assignments/projects or any
Assignments, Project, submission should be students'
CS / PR / OR / Presentation on various original work as plagiarism is a
3 30
CP topics, Viva- voce/ serious academic misconduct.
Quiz, Participation in 2. Mode of citation will be in
class activities OSCOLA format.
Semester End Written
4 50 3 hours and 100 marks
Examination Examination
 Outline Teaching Schedule
No. of
Module Session Topic
Sessions
1. General Introduction – History and Nature of Contractual Obligations:
1.1 Nature and functions of a contract
I 1.2 Justification for and the limits of contract law 6
1.3 Freedom of contract and its exception
1.4 Modern trends in contract law.
2. Elements of a valid contract- Formation of an Agreement
2.1. Offer – kinds of offer, distinction between invitation to treat, revocation
and termination.
2.2. Acceptance – modes of acceptance, communication of acceptance,
revocation.
2.3. Intention to create legal relations
2.4. Consideration – definition and kinds of consideration, exceptions to the
requirement of consideration.
2.5. Free consent – doctrine of consensus ad idem
 Carlill v. Carbolic Smoke Ball Co. (1891-4) All ER Rep.127 1
 Pharmaceutical Society of Great Britain v. Boots Cash
Chemist(Southern) Ltd. (1952) 2 All ER Rep. 456
 Balfour v. Balfour (1918-19) All ER 860 (CA)
 Lalman Shukla v. Gauri Datt (1913) XL ALJR 489 (All.)
II  Bhagwandas Goverdhandas Kedia v. M/s. Girdharilal 9
Parshottamdas & Co., AIR 1966 SC 543
 Harvey v. Facey (1893) AC 552
 Felthouse v.Bindley (1862) 11 CB 869
Making of an Agreement – Special Situations
2.6.Tenders and Auctions - Indian Contract Act, 1872, sections 2 – 10
 Union of India v. Maddala Thathiah, AIR 1966 SC 1724 .
 Rajendra Kumar Verma v. State of M.P., AIR 1972 MP 131 36.
 Kanhaiya Lal Aggarwal v. Union of India, AIR 2002 SC 2766
37.
 Haridwar Singh v. Bagun Sumbrui (1973) 3 SCC 889 39
 Indian Airlines Corporation v. Sm. Madhuri Chowdhuri, AIR
1965 Cal. 252
3. Competency to contract:
3.1. Minor’s agreement – status, agreement for the benefit and to the detriment
of a minor, fraud by minor and estoppel, restitution as a remedy.
3.2. Unsoundness of mind – meaning and exceptions
III 3.3. Insolvency 3
 Mohori Bibee v. Dhurmodas Ghose (1903) 30 I.A. 114 65
 Khan Gul v. Lakha Singh, AIR 1928 Lah. 609 69
 Ajudhia Prasad v. Chandan Lal, AIR 1937 All. 610 78
 4. Elements vitiating free consent:
4.1. Coercion – definition, essential elements, duress and coercion
distinguished.
4.2. Undue Influence – definition, essential elements, parties between whom it
can exist, who is to prove.
4.3. Misrepresentation – definition, essential elements, fraud distinguished.
IV 4.4. Fraud – definition, essential elements, when silence amounting to fraud. 6
 Raghunath Prasad v. Sarju Prasad (1923) 51 I.A. 101 87
 Subhas Chandra Das Mushib v. Ganga Prasad Das Mushib, AIR 1967
SC 878 90
 Lakshmi Amma v. T. Narayana Bhatta, 1970 (3) SCC 159 94
 Tarsem Singh v. Sukhminder Singh (1998) 3 SCC 471
5. Limitations on Freedom of Contract :
5.1. Mistake – definition, mistake of fact and law and their consequential
effects upon the validity of the agreement
5.2. Legality of objects – lawful objects and considerations, immoral
agreements, agreements opposed to public policy
5.3. Agreements expressly declared to be void – agreements in restraint of:
marriage, trade and legal proceedings;
5.4. Uncertain agreements
V 5.5. Wagering agreements. 7
 Gherulal Parakh v. Mahadeodas Maiya, AIR 1959 SC 781 106
 Niranjan Shankar Golikari v. Century Spinning & Manufacturing Co.
Ltd., AIR 1967 SC 1098 119
 Central Inland Water Transport Corpn. Ltd. v. Brojo Nath Ganguly
(1986) 3 SCC 156 (Also see D.T.C. v. D.T.C. Mazdoor Congress, AIR
1991 SC 101;Bank of India v. O.P. Swarankar, AIR 2003 SC 858)128
 Dhurandhar Prasad Singh v. Jai Prakash University,AIR 2001 SC
2552
6. Special categories of contracts: Concept and classification - Indian
Contract Act, 1872, sections 68 – 72
6.1. Contingent contracts – nature, when contingent contract becomes void
6.2. Quasi contracts – meaning and nature, theory of unjust enrichment,
situations where law implies contractual relationship
VI 5
6.3. Government as a contracting party – formation, and constitutional
requirements as provided under Art. 299 of the Constitution of India
6.4. Standard form contracts – nature and advantages, principles of protection
against the possibility of exploitation, judicial approach to such contracts
 State of West Bengal v. B.K. Mondal & Sons, AIR 1962 SC 779
 7. Discharge of liability under a contract:
7.1. By performance- conditions of valid tender of performance, reciprocal
promises
7.2. By death, Inheritance, part performance
7.3. By breach - time as essence of contract, anticipatory breach and actual
breach, constructive breach
7.4. By frustration of contract - Impossibility of performance, specific grounds
of frustration, force majeure
7.5. By period of limitation
7.6. By agreement- rescission and alteration - their effect- remission and waiver
VII 6
of performance - extension of time- accord and satisfaction.
 Satyabrata Ghose v. Mugneeram Bangur & Co., AIR 1954 SC 44
148
 M/s. Alopi Parshad & Sons Ltd. v. Union of India, AIR 1960 SC 588
158
 Punj Sons Pvt. Ltd. v. Union of India, AIR 1986 Del. 158 162
 Easun Engineering Co. Ltd. v. The Fertilizers & Chemicals
 Travancore Ltd., AIR 1991 Mad. 158

8. Remedies for Breach of contract:

8.1. Meaning, kinds of breach, remedies for breach
8.2. Damages – meaning, measure of damages, remoteness of damages
8.3. Specific Performance of contract – which contracts may be specifically
enforced, which may not, persons against whom it can be enforced
8.4. Injunction.
 Hadley v. Baxendale (1843-60) All ER Rep. 461 172
 AKAS Jamal v. Moolla Dawood, Sons & Co. (1915) XX C.W.N.
105 175
 Karsandas H. Thacker v. M/s. The Saran Engineering Co. Ltd.,AIR
VIII 1965 SC 1981 178 6
 Maula Bux v. Union of India, AIR 1970 SC 1955 182
 Shri Hanuman Cotton Mills v. Tata Air Craft Ltd., 1969 (3) SCC
522 186
 Ghaziabad Development Authority v. Union of India,AIR 2000 SC
2003 196
 Oil & Natural Gas Corporation Ltd. v. Saw Pipes Ltd.(2003) 4
SCALE 92

NOTE- Cases given above are not exhaustive. The teacher shall be at liberty to
add new topics/cases.
Total Sessions 48
 Recommended Resources
Compulsory Readings:
1. Avtar Singh, ssContract & Specific Relief, 11th Ed., Eastern Book Company, 2013.
2. Anson’s Law of Contract, Beatson, Burrows and Cartwright (Eds), 29th Ed., Oxford University
Press, 2010.
3. Pollock & Mulla, The Indian Contract and Specific Relief Acts, Volume I & II, 14th Ed., Lexis
Nexis Butterworths Wadhwa Nagpur, 2012.
4. Moitra’s Law of Contract and Specific Relief, 6th Ed., Universal Law Publishing Co., 2012.
5. Chitty on Contracts, Volume I & II, 29th Ed., Sweet & Maxwell, 2004.

Suggesting Readings:
1. Cheshire, Fifoot & Furmston’s Law of Contract, 16th Ed., Michael Furmston (Ed), Oxford
University Press, 2012.
2. Atiyah’s Introduction to the Law of Contract,
6th Ed. Oxford University Press, 2007.
3. Sir G. H. Treitel, The Law of Contract, 13th Ed., London: Sweet & Maxwell, 2011.
4. Dutt on Contract – The Indian Contract Act, 1872, 11th Ed., H.K. Saharay (ed.), Eastern Law
House, 2013.
5. Mitra, S. C. Law of Contracts. 2 vol; 2nded. New Delhi: Orient Publishing Company, 2005.

Articles:
1. Limits of Cognition and the Limits of Contract by Eisenberg, Melvin Aron, E47 Stan. L. Rev. 21
2. Contract Theory and the Limits of Contract Law by Schwartz AlanScott, Robert E.113 Yale L.J.
541
3. Sound of Silence: Default Rules and Contractual Consent BYBarnett, Randy E.78 Va. L. Rev. 821
4. RESTRAINT OF TRADE BANE OR BOON? by Mrs. Naina Krishna murthY, MANU/0053/2007
5. Cosent and Sensibility by Michelle E. Boardman, Harvard law review,vol127,2014
6. The Convergence of Contract and Promise by Sena shiffrin, vol 120 , Harv L, Review 2007
7. Offer and acceptance in modern contract law by Shawn J. Bayman, California law review vol
103,2015
8. A Critical Analysis On Coercion With Respect To Indian Contract Act by Harsh Mishra,
Manupatra 2017
9. Contractual Liability Of The State In India: An Analysis by Ms. Swati Rao Manupatra,2017
10. ‘The early History of Consideration’by Barton, (1968) 85 LQR 372.
11. ‘The Historical Foundation of Modern contract law’ by Horwitz, (1974)87Harvard L. Rev 917.
12. ‘Innovation in Nineteenth Century Contract law by Simpson, (1975) 01 LQR 247.
13. ‘Standard form contracts: The Contract Theory Reconsidered’ by Gluck, (1979)28ICLQ72.
14. ‘The Future and Freedom of Contract’ by Smith (1996) 59 MLR167.
15. ‘The Meaning of Objectivity in Contract’ by Howart, (1984) 100LQR169. ‘The Myth of
subjectivity’ Goddard (1987) 7 Legal studies263.
16. ‘Contract,Consideration and the Critical path’ by Adams & Brownsword (1990)536.
17. ‘Is the Doctrine of consideration senseless and Illogical’? By Ballantine, (1913) 11 Mich. L.
rev.423.
18. ‘Estoppel as a Sword’ by Jackson, (1965) 81 LQR 84.
19. ‘Consideration at the Crossroads’ by Phang, (1991)107 LQR 21.
20. Fundamental Breach of Contract’ by Dawson, ‘(1966) 24 CLJ 192.
21. “Natural Meaning” of Contracts’ by Carter & Pedan (2005) 21JCL277.
22. ‘Remoteness of Damage in Contract’ by Hajihambis, (1978) 41 MLR 637.
23. ‘Specific Performance’ by Kronman, (1978)45 U Chicago LR351.