GROUP 1

1. Desmond Opiyo BSCAS/2022/51120

2.Bunton Shiundu BSCAS/2022/70229

3. Mary syombua BSCAS/2022/52252

4. Brian Otieno BSCAS/2022/71664

5. Dennis Mulevu BAS/2015/22883

1 .LAW OF CONTRACT

The law of contract, in simple terms, refers to the legal rules and principles that govern agreements
between two or more parties. It provides a framework for individuals and businesses to enter into
legally enforceable agreements by establishing their rights and obligations.

In a contract, one party makes an offer, and the other party accepts it, creating a binding agreement.
The law of contract ensures that both parties fulfill their promises and protects them in case of a breach
or disagreement.

aspects of the law of contract:

1. Agreement: There must be an offer by one party and an acceptance by the other party. Both parties
must be clear and unequivocal in their intentions to create a legal relationship.

2. Consideration: Each party must give something of value, such as money, goods, or services, in
exchange for what the other party is offering. This mutual exchange is known as consideration.
3. Intention to create legal relations: The parties must intend to enter into a legally binding agreement.
Certain social or domestic agreements may not be legally enforceable because they lack this intention.

4. Capacity: The parties involved must have the legal capacity to enter into a contract. This means they
must be of legal age, mentally competent, and not under duress or undue influence.

5. Legality: The contract must involve lawful activities and purposes. Contracts to engage in illegal
activities are not enforceable by law.

6. Terms and conditions: The contract must include clear and specific terms and conditions that outline
the rights and responsibilities of each party. It should address important aspects such as price, quantity,
timeframes, and performance expectations.

7. Performance and breach: Once the contract is formed, both parties are obligated to fulfill their
respective promises. If one party fails to perform as agreed, it may be considered a breach of contract,
which can lead to legal remedies or damages.

8. Remedies: In case of a breach, the law of contract provides various remedies, such as specific
performance (compelling the defaulting party to fulfill the contract), damages (monetary
compensation), or rescission (canceling the contract).

N/B: It is important to note that the law of contract can be complex, and its interpretation may vary
depending on jurisdiction and specific circumstances. Legal advice from a qualified professional should
be sought when dealing with contractual matters.

2.CONTRACT FORMATION

The formation of a contract refers to the process by which a legally binding agreement is created
between parties. It involves several essential elements and steps. Here's a general overview of the
formation of a contract:
1. Offer: The process begins with one party making an offer to another party. An offer is a proposal that
outlines the terms and conditions of the agreement, including the subject matter, price, quantity, and
any specific requirements or limitations.

2. Acceptance: Once an offer is made, the other party must accept it unconditionally and without
making any material changes to the terms. The acceptance creates a mutual agreement between the
parties. Generally, acceptance must be communicated to the offeror, although certain circumstances
may allow for acceptance through conduct or silence.

3. Consideration: For a contract to be valid, there must be an exchange of consideration. Consideration

refers to something of value that is promised or given by each party. It can be money, goods, services, or
a promise to do or refrain from doing something.

4. Intention to Create Legal Relations: Both parties must have the intention to create legal relations,
meaning that they intend to enter into a legally binding agreement. This requirement helps distinguish
social or domestic arrangements from enforceable contracts.

5. Capacity: The parties entering into a contract must have the legal capacity to do so. This typically
means that they must be of legal age and mentally competent. Minors, individuals lacking mental
capacity, and those under the influence of drugs or alcohol may not have the capacity to enter into a
contract.

6. Genuine Consent: The consent of the parties must be genuine and free from any undue influence,
duress, fraud, misrepresentation, or mistake. Consent should be given willingly and based on a full
understanding of the terms and implications of the contract.

7. Legality: The contract must have a lawful purpose. It should not involve any illegal activities or go
against public policy. Contracts to engage in illegal activities or that are contrary to the law are generally
not enforceable.
8. Formalities: In general, contracts do not need to follow any specific formalities, and they can be oral
or written. However, certain types of contracts, such as those involving the sale of real estate or the
creation of wills, may require specific formalities as prescribed by law.

N/B: It is important to note that the specific requirements and rules for the formation of a contract may
vary between jurisdictions and can depend on the type of contract involved. Legal advice from a
qualified professional is recommended to ensure compliance with applicable laws and regulations.

3.The essentials of a valid contract

1. Offer and Acceptance: There must be a clear offer made by one party to another, and the other party
must accept the offer without any conditions or modifications. Both the offer and acceptance should be
communicated between the parties.

2. Intention to Create Legal Relations: The parties involved must intend to enter into a legally binding
agreement. This means that the agreement should not be a mere statement of intention or a social
arrangement.

3. Consideration: Consideration refers to something of value that is exchanged between the parties.
Each party must provide something of value, such as money, goods, services, or a promise to do or
refrain from doing something.

4. Capacity: The parties entering into the contract must have the legal capacity to do so. This generally
means that they must be of legal age and mentally competent. Minors, individuals lacking mental
capacity, and those under the influence of drugs or alcohol may not have the capacity to enter into a
contract.

5. Free Consent: The consent of the parties must be free from any undue influence, duress, fraud,
misrepresentation, or mistake. Consent should be given willingly and based on a full understanding of
the terms and implications of the contract.
6. Lawful Object: The contract must have a lawful purpose. It should not involve any illegal activities or
go against public policy. Contracts to engage in illegal activities or that are contrary to the law are
generally not enforceable.

7. Certainty: The terms and conditions of the contract should be clear, specific, and definite. It should be
possible to ascertain the rights and obligations of each party based on the contract's language.

8. Legal Formalities: While most contracts do not require any specific form or format, certain types of
contracts may need to comply with specific formalities as prescribed by law. For example, contracts
related to the sale of real estate or the creation of a will may need to be in writing and signed by the
parties.

N/B:It is important to note that contract laws may vary between jurisdictions, and there may be
additional requirements or exceptions depending on the specific circumstances. Seeking legal advice
from a qualified professional is always recommended when creating or interpreting contracts.