The Indian Contract Act, 1872

Definition of Contract
An agreement enforceable by law is a contract. This means that both parties are legally bound to perform their obligations
under the agreement. The Contract Act outlines the principles governing formation, performance, and breach of contracts.

Offer and Acceptance Consideration

The first element is an offer made by one party and its Something of value must be exchanged between the
acceptance by the other. parties. This can be a promise, an act, or a forbearance.
Essential Elements of a Valid
Contract
The Contract Act lays down certain essential elements that must be
present for a contract to be legally valid and enforceable.

Free Consent Capacity to Contract

The parties must agree to the The parties must be legally
contract freely and without capable of entering into a
undue influence or coercion. contract, meaning they must
be of sound mind and not
minors.

Legality of Object Certainty of Terms

The purpose of the contract The terms of the contract
must be legal and not against must be clear and definite,
public policy. leaving no room for ambiguity.
Kinds Of Contracts
Contracts are classified based on various factors, including their formation, performance, and enforceability. Some common
types of contracts include:

Express Contract Implied Contract Bilateral Contract Unilateral Contract

Parties explicitly agree to The terms are implied from Both parties make promises Only one party makes a
the terms of the contract, the conduct of the parties or to each other, creating promise, and the other party
either verbally or in writing. the circumstances reciprocal obligations. performs an action in
surrounding the agreement. response.
Offer and Acceptance: A
Guide
This presentation explores the essential elements of offer and acceptance in
contract law.
The Proposal or Offer and Some Important
Concepts
Proposal or Offer Important Concepts
A proposal or offer is a clear and definite statement by one Essential components of a valid offer include: (1) intention to
party (the offeror) to another party (the offeree), expressing create legal relations, (2) definite terms, and (3)
their willingness to enter into a binding agreement on certain communication to the offeree.
terms. It must be communicated to the offeree.
Legal Rules Regarding a Valid Offer
Certainty Communication Invitation to Treat
The offer must be definite and The offer must be communicated to Invitations to treat are not considered
certain, leaving no room for the offeree. It can be communicated offers. They are merely invitations to
ambiguity or uncertainty. It should orally, in writing, or by conduct. The make an offer. Examples include
clearly specify the essential terms of communication must be clear and advertisements, price lists, and
the agreement, including the subject unambiguous. displays of goods in shop windows.
matter, price, and quantity.
Lapse and Revocation of Offer, The Acceptance,
and Communication

Lapse of Offer Revocation of Offer Acceptance Communication

An offer automatically lapses The offeror can revoke an Acceptance is the unqualified The acceptance, revocation,
after a reasonable time or offer at any time before and absolute agreement to and lapse of an offer must be
upon the occurrence of a acceptance, even if they the terms of the offer. It must communicated effectively to
specified event. promised to keep the offer be communicated to the the relevant parties.
open. offeror by the offeree.
Contract Law: Consideration
Consideration is a key element in contract law. It is the price or value that
each party agrees to exchange in a binding agreement. Without
consideration, a contract is generally unenforceable.
Stranger to a Contract and Consideration
Stra nger to a Co ntr act Stra nger to Cons ideration

A "stranger to a contract" is someone who is not a party to the A "stranger to consideration" is someone who is not a party to
agreement and has no legal rights or obligations under it. the agreement and does not provide any consideration for the
promise.
Doctrine of Privity of Contract

Privity
1

2 Co ntr act

Parties
3 The doctrine of privity of contract states that only parties to a
contract can sue or be sued on it.
No Consideration, No
Contract: Exceptions
Pr omis so ry Es to ppel Past Cons ideration
A promise made without Past acts can sometimes be
consideration can be enforced considered valid consideration
if the promisee relies on the if there was a clear
promise to their detriment. understanding of a future
benefit.

Part Payment of Debt

Payment of a smaller amount can be considered valid consideration if
the creditor agrees to accept it as full payment.
Contractual Capacity
This presentation outlines the legal concept of contractual capacity, focusing
on minors and persons of unsound mind.
Meaning of Contractual Capacity and Minors
Contractual Capacity Minors
The legal ability to enter into a binding contract. Individuals Individuals under the age of majority, typically 18 years old, are
must possess the mental capacity to understand the terms and generally considered to lack full contractual capacity. Their
obligations of the agreement. agreements can be voidable at their option.
Nature of Minor's
Agreements
Voidable Exceptions
Minors can choose to ratify or Certain contracts, such as those
disaffirm the agreement, even for necessities like food or
after reaching the age of shelter, are typically binding on
majority. minors.

Misrepresentation
If a minor misrepresents their age, they may be held to the contract.
However, the law may provide some protection for minors.
Law Relating to Minor's Agreements and
Persons of Unsound Mind

Law Agreements Unsound Mind

Laws vary by jurisdiction, but generally Contracts entered into by minors or those Individuals with mental disabilities may
provide legal protections for minors and with mental incapacities may be lack the capacity to understand the terms
persons of unsound mind. unenforceable or subject to legal of a contract, rendering their agreements
challenges. voidable.
Consent and Agreement in
Contract Law
Understanding the legal concepts of consent and free consent is crucial when
forming valid contracts. We'll explore these principles and their implications.
Coercion, Undue Influence, and Misrepresentation
Coercion Undue Influence Misrepresentation
This involves threats or force to compel This is when a dominant party unfairly This involves false statements made
consent. It can be physical or mental, and persuades a weaker party to consent, during negotiations that can induce
includes actions causing fear of harm. taking advantage of a relationship of consent. It can be innocent, negligent, or
trust. fraudulent.
Fraud and Loss of Right of
Rescission
Fraud Loss of Right
This occurs when one party The right to rescind a contract
intentionally misrepresents facts due to fraud can be lost if the
to deceive the other party, deceived party affirms the
causing them to agree to a contract after discovering the
contract. fraud.
Mistake in Contract Law

Mistake of Law Mistake of Fact

This involves an incorrect This occurs when parties have a
understanding of legal rules or shared, incorrect belief about a
principles, which can render a crucial aspect of the contract, making
contract voidable. it voidable.

Bilateral Mistake Unilateral Mistake

When both parties make a mistake, This occurs when only one party is
the contract can be voided, as there mistaken, and the contract is typically
was no genuine meeting of the minds. upheld unless the other party knew or
should have known of the mistake.
Legality of Contracts: Essential
Elements
For a contract to be valid and enforceable, the object and consideration
must be legal and not against public policy.
Unlawful Consideration and Objects
Illegality Examples
Contracts involving illegal objects or considerations are void Examples of illegal objects or considerations include
and unenforceable. This includes agreements that involve contracts for the sale of illegal drugs, contracts for the
criminal activities, fraud, or other illegal acts. performance of illegal acts, and contracts that promote fraud
or deception.
Public Policy Considerations
Harm Examples
Contracts that are against public policy are also void. Examples include contracts that promote restraint of
Public policy protects the public interest and prevents trade, contracts that violate laws or regulations, and
harm. contracts that are immoral or unethical.
Effects of Illegal Agreements

Void No Recovery
Illegal agreements are Neither party can recover any
unenforceable. No party can seek money or property exchanged
legal relief or enforce the contract. under the illegal agreement.
Void Agreements: When
Contracts Fail
This presentation explores types of agreements that are considered legally
void under the Indian Contract Act, 1872, and why they are unenforceable.
Restraints on Marriage and Trade
Marriage Trade
Agreements restricting someone's right to marry are void. These Agreements that unreasonably restrain trade are also void. This
agreements attempt to control personal choices and are deemed applies to contracts that limit competition or prevent individuals
against public policy. from pursuing their livelihoods.
Uncertain Agreements and
Wagering
Uncertain Agreements Wagering Agreements
Agreements with uncertain Agreements based on uncertain
terms or conditions are events where one party benefits
considered void. The parties' at the expense of another are
intentions must be clear and void. These are considered
definite for a contract to be speculative and lack a
enforceable. legitimate commercial purpose.
Impossible Conditions and Legal Barriers

Impossible Conditions
1 If an agreement relies on an impossible event, it is void. For instance, a contract to build a house
on the moon would be unenforceable due to the impossibility of fulfilling the condition.

Legal Barriers
Agreements that violate existing laws or public policy are
2
deemed void. This ensures contracts align with legal and moral
principles.
Quasi-Contract: An Overview
This presentation will explore the concept of quasi-contract in law, shedding
light on its essential characteristics and types.
Meaning of Quasi-contract
Imp licit Co ntr act Preventing Unjus t E nric hment
A quasi-contract, also known as an implied contract, arises The underlying principle of quasi-contract is to prevent one
when the law enforces a promise or obligation even though party from unjustly benefiting at the expense of another party.
there is no express agreement between the parties.
Types of Quasi -contract

Sectio n 68 Sectio n 69 Sectio n 70

This section deals with a person who, This section covers situations where a This section applies when a person
at another's request, does something person, capable of contracting, is who is interested in the payment of
for him, or delivers something to him, supplied by another person with money, which another is bound by
not intending to do so gratuitously, or necessaries suitable to his condition law to pay, pays it, or does something
having reason to believe that such in life, the person supplying them not for the benefit of the other person,
other person would not object. knowing that the person supplied is intending to get the money back.
unable to contract.
Conclusion and Key Takeaways
Quasi-contracts are essential for ensuring fairness in situations where a clear contract does not exist. The different types of quasi-
contracts, outlined in Sections 68 to 72, provide specific legal frameworks to address various scenarios of unjust enrichment. It's
crucial to understand these concepts to ensure legal compliance and prevent disputes.