PRESENTATION ON CONTRACTS

ABHISHEK BHASINROLL NO- 01MBA 1ST YR

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DEFINITIONS• A contract is an agreement made between

two or more parties which the law will enforce.

• Sec 2(h) defines a contract as an agreement enforceable by law.

• Pollock: “ Every agreement and promise enforceable at law is a contract.”

• Salmond: “ A contract is an agreement creating and defining obligations between the parties.”

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CONTRACT

AGREEMENT+ ENFORCEABILITY

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TYPES OF CONTRACT

• Contracts can be classified according to their-

i. Validityii.Formationiii.Performance

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CLASSIFICATION BASED ON VALIDITY

1. Valid Contract-Contract which satifies all legal requirement under sec 10.

2. Voidable contract- “free consent missing”

3. Void contract- ceases to be inforceable by law

4. Illegal contract- criminal or immoral in nature

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VOIDABLE CONTRACT

• A promises to sell his car to B for Rs. 2,000. But his consent is obtained by use of force. The contract is voidable at the option of A. He may avoid the contract or may choose to bound by it.

Consent is obtained by coercion, undue

influence, fraud or misrepresentation.

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VOID CONTRACT

A and B contract to marry each other. Before the time fixed for the marriage, A goes mad. The contract becomes void.

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ILLEGAL CONTRACTS

• B borrows Rs. 5,000 from A and enters into a contract with C to import prohibited goods. A knows the purpose of the loan but still gives the loan.The transaction between B and A is serving to support the main agreement.Hence the contract becomes illegal since the main agreement is illegal.

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CLASSIFICATION BASED ON FORMATION

• Express contract- The terms of a contract are expressly agreed upon (either by spoken words or in writing) at the time of formation of the contract.

Eg: A pays Rs. 20,000 to B with the purpose of

buying B’s car. The terms of the agreement are written in a document signed by both of them.

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CLASSIFICATION BASED ON FORMATION

• Implied contract- It is inferred from the acts or conduct of the parties.It is not a result of any express promise. No verbal means are used to express the acceptance of proposal of contract.

Eg: There is an implied contract when A-i. Gets into a public bus ii. Take a cup of coffee in a restaurantiii.Obtains a ticket from automatic weighing

machine

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CLASSIFICATION BASED ON FORMATION

• Quasi contract- It’s not a contract at all in strict sense. No intentional entering into contract is there. It is created by law. It rests on ground of equity that “ a person shall not be allowed to enrich himself unjustly at the expense of another.”

Eg: A supplier leaves goods at C’s shop by mistake. C treats the goods as his own. C is bound to pay for the goods.

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CLASSIFICATION BASED ON PERFORMANCE

• Executed contract- both parties have performed their respective obligations

Eg: A agrees to paint a picture for B for Rs.

1000. When A paints the picture and B pays the price, i.e., when both the parties have performed their obligations, the contract is said to be executed.

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CLASSIFICATION BASED ON PERFORMANCE

• Executory contract- Both the parties are yet to perform their obligations.

If A has not yet painted the picture and B has not yet paid the price, the contract is executory.

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THANK YOU

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