CHAPTER 1- The Indian Contract Act 1872

Saturday, 10 February 2024 7:11 PM

Law- "the body of principles recognized and applied

Salmond- by the state in administration of justice
OR
"rule of external human action enforced by
Holland- sovereign political academy"
OR
Austin- "a rule of conduct imposed and enforced by the sovereign"

Purpose of the TICA- control various kinds of business and commercial activities

WHAT IS BUSINESS LAW?

- A branch of legal system that regulates business activities and provides for an
orderly conduct of business affairs and also for settlement of genuine
disputes in a systematic manner.

AGREEMENTS

What is an agreement- every promise and set of promises forming the

consideration for each other is an agreement.

Agreement= offer + acceptance

TYPES OF AGREEMENTS

→ Valid agreement- one which is enforceable by law

→ Void agreement- not enforceable by law, as it has no legal existence at all and
is without any legal effect

→ Enforceable agreement- an agreement enforceable by law is a conduct

→ Voidable agreement- it is enforceable by law at the option of one or more of

the parties thereto but not at the option of the other or others.

→ Unenforceable agreement- it is valid in law but is incapable of proof because

of some technical defect
 → Voidable agreement- it is enforceable by law at the option of one or more of
the parties thereto but not at the option of the other or others.

→ Unenforceable agreement- it is valid in law but is incapable of proof because

of some technical defect

→ Illegal agreement- it is something against the law and public policy a.k.a. void
ab initio

What is a contract?

- An agreement enforceable by law

- Contract= an agreement + enforceable by law

Essential elements of a void contract

a) Offer and acceptance- these should be a 'lawful offer' by one party and
'lawful acceptance by other'

b) Legal relationship- without a legal relationship, the contract is not there. Eg- a
friendly agreement cannot be called contract

c) Lawful consideration- price for which promise of another is bought. In this a

promise should be made ad both parties should benefit too.

d) Capacity of parties- the parties involved must be competent to the contract,

if important contract is not valid. Eg- minors, unsound mind, convict,
insolvent, alien enemy

e) Free consent- in this parties must have agreed upon the same thing in the
same sense. There should be no use of force.

f) Lawful object- the object of an agreement must be valid. It is unlawful when,

i) it is forbidden by law, ii) its nature, iii) it is fraudulent, iv) it is harmful to
another person, v) court regard it is as immoral

g) Agreement not declared void by law- i) agreement in restraint of trade, ii)

agreement in restraint of marriage, iii) agreement in restraint of legal
proceedings

h) Possibility of performance- the act should not be impossible in itself,

physically, or legally, hence cannot be enforced by law. Eg- lets discover
treasure by magic

i) Certainty of terms- the agreement should consist of terms ad they should be

certain and ultra modern décor, the contract here is void as the term 'ultra
modern' is not certain.