2. CONTRACT
MEANINGS
A contract is a legally binding
agreement which recognises and
governs the rights and duties of the
parties to the agreement. A contract
is legally enforceable because it
meets the requirements and approval
of the law. An agreement typically
involves the exchange of goods,
services, money, or promises of any
of those. In the event of breach of
contract, the law awards the injured
party access to legal remedies such
as damages and cancellation.
3. CLASSIFICATION
ACCORDING TO
ENFORCEABILITY
CLASSIFICATION OF CONTRACT
ACCORDING TO
ENFORCEABILITY
ACCORDING TO
FORMATION
ACCORDING TO
PERFORMANCE
1.VOID
AGREEMENT
2.VOID CONTRACT
3.VOIDABLE
CONTRACT
4.UNLAWFUL
AGREEMENT
5.ILLEGAL
AGREEMENT
6.UNENFORCEABL
E CONTRACT
1.EXECUTED
CONTRACT
2.EXECUTORY
CONTRACT
3.PARTLY
EXECUTED
CONTRACT
1.EXPRESS
CONTRACT
2.IMPLIED
CONTRACT
3.QUASI
CONTRACT
4. ACCORDING TO ENFORCEABILITY
“A contract which ceases to be enforceable by law
becomes void when it ceases to be enforceable”.
“An agreement which 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, is a voidable
5. VOID AGREEMENT
• The section 2(j) of the
Act defines a void
contract as “A contract
which ceases to be
enforceable by law
becomes void when it
ceases to be
enforceable”. This
makes all those
contracts that are not
ACCORDING
TO
ENFORCEABILIT
Y
1.VOID AGREEMENT
2.VOID CONTRACT
3.VOIDABLE
CONTRACT
4.UNLAWFUL
AGREEMENT
5.ILLEGAL
AGREEMENT
6.UNENFORCEABLE
CONTRACT
6. VOID CONTRACT
• A void contract is a formal
agreement that is effectively
illegitimate and
unenforceable from the
moment it is created. A void
contract differs from a
voidable contract, although
both may indeed be nullified
for similar reasons.
7. VOIDABLE CONTRACT
• These types of Contracts are
defined in section 2(i) of the Act:
“An agreement which 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, is a voidable contract.” This
may seem difficult to wrap your
head around but consider the
following
8. EXAMPL FOR VOIDABLE
Suppose a person A agrees to
pay a sum of Rs. 10,0000 to a
person B for an antique chair.
This contract would be valid, the
only problem is that person B is a
minor and can’t legally enter
a contract.
9. UNLAWFUL AGREEMENT
•An unlawful agreement is
an agreement to do
something illegal such as
charge an excessive interest
rate, purchase illegal drugs,
or engage in sex for money.
Such agreements are
against public policy and
cannot be enforced in court.
10. EXAMPLE FOR UNLAWFUL
if a couple makes an agreement to live-in. It
is not illegal but unlawful i.e. no support
from courts. Illegal agreements are
those agreements that attracts a crime and
is prohibited by law. For example, if a
person offers money to someone to beat a
guy, it is illegal agreement.
11. ILLEGAL N AGREEMENT
• An illegal agreement in business law is a
contract that was made for an illegal
reason and is consequently against the
law. If the content of the agreement causes
the parties to perform illegal actions, then
the contract is illegal.
• Agreements collateral to the original are
also considered void. Collateral
agreements are agreements that are
connected or incidental to the original
agreement. The law prohibits these kinds
of agreements, and entering into one is
punishable by law.
12. EXAMPLE FOR ILLEGAL
A void contract is not punishable by law, while
an illegal agreement is considered an
offense. Examples of illegal contracts
include: Agreements for the sale and distribution
of illegal substances like
drugs. Agreements for illegal activities like
prostitution.
