Professional Documents
Culture Documents
Essentials:
2 or more parties
Offer and Acceptance – one has to offer and other has to Accept
Identity of Minds – Agreed upon the Subject Matter
Consideration – Something in return –every contract must be supported
by Consideration
Capacity – Competent parties to contract
Free Consent – Free from flaw, not caused by coercion / Undue
influence
Lawful Consideration – The consideration must be lawful
Legality of Object – recognized and approved by society.
Classification of Contract:
I According to Validity – Contract based on agreement – all essentials
Are present. If any one is missing then it is void able/ void/ illegal and
Unenforceable.
Person to whom the proposal is made signifies his assent thereto, the
Proposal is said to be accepted.
Essential of Valid Acceptance:
• Communicated in a reasonable manner, expressed in words, spoken,
written or may be conduct.
• Communication of acceptance may be waived off by the offeror
• Acceptance must be made before offer lapses or is revoked or rejected
• Acceptance must be absolute and unconditional and should correspond
with the terms of offer.
• Acceptance once made concludes the Contract.
• Minor
• Person of unsound mind
• Persons disqualified by law to which they are subject to
• Convict
• Bankrupt
• Alien enemy
• Foreign ambassadors
• Insolvent
Free Consent:
Consent – Act of accepting the offer by free will ie without any force.
u/s 11 following are considered consent which is not free.
• Misrepresentation –
False statement (information is wrong)
Person making it honestly believes to be true
non-disclosure of material facts – without intention to deceive other
party, positively asserts to be true.
•Fraud u/s 17
False statement made knowingly
Facts are not true
Active concealment of facts
Intention to cheat
• Mistake of Law:
Law of the country – ignorance is no excuse
Of Foreign Country – u/s 21, such mistake is treated as mistake of fact
and agreement in such case is void.
Rescission u/s 62 – when all or some of the terms of the contract are
cancelled it may occur by mutual consent, where one fails in
performing of their obligation, the other party may rescind the contract
claim compensation for breach of contract.
Remedies:
Recission – may sue to treat the contract as rescinded and refuse
Further performance – he is absolved of all his obligations