Q ) Define negotiable instruments ? Types of negotiable instruments.

> Negotiable
I. The word negotiable means ' transferable by delivery ' and the word instrument
means written document by which are right is created in favour of same person .
II. " Negotiable instrument means maybe made payable to two or more payees jointly
or it may be made payable in the alternative to one of two or one or same of serval
payees".

* Types of negotiable instrument:-

1) Instrument Negotiable by Statute :-
Instruments act mention only three kinds of negotiable instrument
I. Bills of exchange
II. Promissory notes and Cheques

These instrument are negotiable by Statute

2) instrument negotiable by customer or usage:-

There are certain other instrument which have acquired the character of negotiable
by usage of customer

*For Example:-
In England the following instrument have been held to negotiable by custom
I. Exchequer bills
II. Bank notes
III. Share warrants
IV. Circular notes
V. Bearer debentures
VI. Dividend Warrants
VII. Share certificate with blank transfer deeds etc.

The list of negotiable instrument does appeared to be flexible and inclusive .

Section 137 of the transfer of property act also recognises the negotiability of
instrument by ' law or custom '.

* Thus in India , the following instrument have been held to the negotiable by
usage or custom .

I. Government promissory notes.

II. Bankers draft and pay orders.
III. Hundis, delivery order and
IV. Railway receipts

Q) What are the essential elements of valid contract?

> Essential elements of valid contract :-

1) Agreement Coffer and acceptance :-

Tu constitute a contract there must be an agreement and for agreement than must be
a ' lawful offer ' and the ' lawful acceptance ' of the offer.

2) Intention to create legal relations:-

There must be intention among the parties that the agreement should be attached by
legal consequences and create legal obligations.

3) Lawful consideration:-
The third essential elements of the valid contract is presence of ' consideration '
. Consideration has been defined as price paid by one party for promise of the
other.
4) Capacity of parties:-
The parties to an agreement must be component to contract. ; otherwise it cannot
be enforced by the court of law .

5) Free and genuine consent [ Section 14 ] :-

Free consent of all the parties to an argument is another essential element of a
valid contract . 'consent' means that party is must be agreed upon the same thing
in same sense [ Section 13 ] .

6) Lawful object :-
For the formation of a valid contact it is also necessary that the parties to an
agreement must agree for a lawful object.

7) Writing and registration:-

According to an Indian contract act, a contract may be oral or in writing . But in
certain special cases it lays , down that agreement to be valid much be in writing
or/and registered.

8) Certainity:-
Section 29 of contract act provides that ' Agreement the meaning of which is not
certain or capable of being made certain our valid '.

9) Possibility of performance or doctrine or frustration :-

Section 56 lays down that ' An agreement to do an act impossible itself is void '.

10) agreement not declared void or lawful agreement:-

The agreement must not be one , which the lord declared to be either illegal or
void.

Q ) What are the different modes of Discharge of a contract?

-> Various modes of discharge of contract are as follows:-

1) By Performance:-
Performance of contract is one of the obvious methods of discharging a contract.
It takes place when the parties to a contract fulfil their respective obligations.

2) By Mutual Agreement:-
A contract can be discharged by mutual agreement in any of the following ways:-

I. Novation -
It means a low contract is entered into in consideration of the old contract. The
new contract is entered into between the same parties or the new parties. The
novation is valid when all the parties must consent it.

II. Alteration -
An alteration of a contract means a change in one or more terms of the contract
with the mutual consent of the parties. The alteration discharges the original
contract and creates a new contract

III. Rescission -
The rescission of a contract means the cancellation of the contract by one or all
the parties to the contract

a) With the mutual consent of the parties

b) By a party whose consent was not freely obtained
c) One party may rescind the contract. if a breach of contract by other party
IV. Remission:
It means the acceptance of a lesser consideration that what is agreed under the
contract. It takes place when the promise.

a) Dispense with a part or whole of the performance of a promise.

b) Extends the time for a performance by the promisor.
c) Accepts a lesser sum.

V Waiver-
It means the abondonment of right by the party under the contract. No
consideration is necessary for the waiver

3) By Discharge of a contract by Impossibility of Performance:-

The performance of a contract is impossible. In such a case, the contract is
discharged.

I. Initial Impossibility or Pre-contractual Impossibility:-

It means impossibility exists at the time of making a contract. The initial
Impossibility

a) Known to the Parties:-

It means one or both the parties have a knowledge. that a promise is impossible to
perform even though
they enter into an agreement.

b) Unknown to the parties:-

It means both the parties genuinely believe that the performance of a promise is
possible but it is impossible to perform.

c) Known to the promisor only:- Where the promisor alone knows about the initial
impossibility . Such promiser must compensate for any loss which promises sustain
through the non-performance of the promise.

II. Supervening impossibility or post Contractual impossibility:-

The contract becomes void an account of the subsequest Impossibility only if the
following condition are satisfied.
a) Destruction of Subject-Matter
b) Death or Incapacity for personal services.
c) Declmation / Outbreak of war d) Charge of low.
e) Non Existence or Non-occurence of a particular state of things Necessary.

4 ) By Discharge of a contout by Lapse of Times:-

Every contract and promise under the contract should be performed within a limit.
The contract le discharged if it is not performed or enforced within a specified
period called of the period of limitations

5) By Discharge of a contract by operation of law:-

I. Death:-
The contract that requires personal skill is discharged. on the death of the
promisor

II. Merger:-
The conversion of the inferior right into superior right is called a merger. It is
also called as vesting of right and liabilities in the same person

III. Insolvency
The insolvent is discharged from all the liabilities on all the contracts entered
into , upto the date of insolvency

IV. Unauthorised material alteration:-

The alteration which changes the Nature of the contract is material alteration

V. By the identify of promisor & promisee :-

When the promisor becomes the promisee the other parties are discharged

6) By Discharge of a contract by breach of contract:-

It means the failures of a party to fulfill his obligations or promise under the
contract. When there is a breach of contract certain remedy or consequences are
available to the aggrieved party .

Q ) Explain Conditions and Warranties?

> Condition [ Section 12(2) ] :-

1 )A " condition is a stipulation essential to the main purpose of contract the
breach of which gives the aggrieved party a right to treat the contract as
repudaited "

2) Warranty [ Section 12(3) ] ;-

According to Section 12 (3)of sale of good act 1930
" A warranty is stipulation collecteral to main purpose of contract the breach
which gives rise a claim for the damage but not to right to reject the goods and
treat the contract as repudiated "

* Express an implied Condition and Warranties :-

The stipulation as any ' condition ' and ' warranty ' maybe either
I. Express :-
Thry are ' express ' when the term of the contract expressly State them

II. Implied :-
They are ' implied ' when not being especially provided for the use only.

* Implied Conditions :-
According to sale of goods act 1930 the implied condition on part of seller and
buyer include

I. Condition as to Title [ Section 14(9) ] :-

Section 14 (a) provides that in a contract of sales unless the circumstances of
contract are such as to show different intention there is an implied condition.

II. Sale of description ( Section 15) :-

In a sale of description there is an implied condition that a good shall correspond
with the description , and if sale is by sample as well as by description

III. Condition has to fitness or quality [ Section 16 (1) ] :-

As a journal rule, a buyer is supposed to satisfy himself about the quality of
goods to be purchase and also be incharge with the responsibilities or for seeing
for himself that the good suits the purpose for which he buys them.

IV. Condition as to merchantability [ section 16(2) ] :-

Where the goods are broad by description from seller who deals in good of that
description there is an implied condition that good shall be of merchant quantity.

V. Condition as to whole Someness :-

In the case of established and provisions in addition to be implied condition as to
merchant ability there is another implied condition that the good shall be
wholesome .
2) Implied warranties :-
Section 14 (b) and 14 (c) of sales of goods act 1930 lay down implied warranties
for contract of sale of goods

I. Warranty as to undistribed possession [ Section 14 (a) ] :-

In every contract of sale , unless there is an contrary intention , there is an
implied warranty that the wires shall have an enjy quite posession of the goods .

II. Warranty as to non-existence of encumbrances [ Section 14 (b) ] :-

The buyer is entitle to the further warranty that the good shall be free from any
charge or encumbrances is a favour of any third party not declared or non to buyer
before or time when contact is made.

III. Disclosure of dangerous nature of goods :-

There is another implied warranty on the part of seller that in case the goods are
in herently dangerous the sailor must warn the buyers.

IV. Warranty as to quality your fitness by usage of trade [ Section 16 (4) ] :-

And implied warranty as to quality or fitness for a particular purpose maybe
announced by the usage of trade.

Q ) explain the remedies for breach of contract ?

> A remedies a course of action available to an aggrieved with party for the
enforcement of the right under a contract various remedies available to an
aggrieved with party as follows

I. Recession of contract:-
When a breach of contract is committed by one party , the other party may due to
treat the contract as rescinded . In such a case the aggrieved party is freed from
all his obligations under the contract .

II. Suits upon Quantum meruit :-

The term Quantum meruit indicates " as much as earned or in proportion to the work
done ".
Right to due and Quantum meruit arises where a contract party performed by one
party has become discharged by the breach of contract by other party .

III. Suit for specific performance :-

Specific performance means the actual carrying out of a contract by parties there
to wear a party fails to carry out contract the court may as its discretion direct
the defendant to perform his undertaken as per terms of contract.

IV. Suit for injunctions :-

An injunction is a made of securing the specific performance of a negative term of
the contract

V. Suit for damages:-

The common law remedy for breach of contract is damages. Damages Ara monitory
compensation adjusted to the paid to the injured party for the loss or injury
suffered by him.