This chapter covers contracts and how acceptance and revocation takes place.

1. CHAPTER 2
Contract and its validity and revocation
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2. On the basis of validity
1. Valid Contract
An agreement enforceable by law when all
the essential features of a valid contract are
present.
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3. 2. Voidable Contract
A contract becomes voidable when the
consent is not free.
Usually a contract becomes voidable when the
consent of one of the parties to the contract
is not free.
Eg- A, threatens to shoot B if he does not sell his
bike to A. B agrees.This contract is voidable
at the option of B
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4.  3. Void Contract
A void contract is the contract that has no legal
effect at all.
“ A contract which ceases to be enforceable by
law becomes void, when it ceases to be
enforceable by law.”
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5. On the basis of formation
 1. Express Contract
Contracts formed with the words spoken or
written, is an express contract.
Eg- A tells B on phone that he wants to buy his
car for Rs 80,000 and B accepts the offer on
phone, this is an express contract.
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6. 2. Implied Contract
When the offer and acceptance is made by
acts or conducts of the parties, it is an implied
contract.
For eg- A, a coolie in uniform takes up the
luggage of B at Railway Station and B allows
him to do so, then the law implies that B will
have to pay for the services of A.This is an
implied contract.
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7. 3. Quasi-Contract
Quasi-contract doesn’t arise by virtue of any
agreement, but the law infers or recognizes
these contracts under special circumstances.
For eg- Claims for necessaries supplied to an
incapable person.
2. Responsibilities of finder of goods.
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8. On the basis of execution
1. Executed Contract
A contract is said to be executed contract
when both the parties to a contract have
performed their obligations.
For eg-When a bookseller sells a book on cash
payment, it is an executed contract because
both the parties have done what they were to
do in a contract.
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9.  2. EXECUTORY CONTRACT
When either both the parties to a contract
have still to perform their share of obligation,
then it is executory contract.
For eg- A buys a car from B for Rs 100,000.
Now, A has made the payment but B has not
transferred the contract, it is an executory
contract as the parties have to meet the
obligation.
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10. Communication of
Offer, Acceptance and Revocation
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11. Communication when complete
Communication of a proposal:
 The communication of a proposal is
complete when it comes to the knowledge
of the person to whom it is made.
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12. Illustration
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A proposes, by letter, to sell a house
to B at a certain price.
The communication of the proposal
is complete when B receives the
letter.

13. communication of an acceptance
 The communication of an acceptance
is complete,–
 as against the proposer, when it is put
in a course of transmission to him, so
as to be out of the power of the
acceptor;
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14. 05،‫دسمبر‬16
As against proposer As against acceptor
when it is put in a
course of
transmission to him,
so as to be out of the
power of the
acceptor;
as against the
acceptor, when it
comes to the
knowledge of the
proposer

15. illustration
B accepts A's proposal by a letter sent by post
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Communication complete
As against A As against B
When the letter is
posted by B
When the letter is
received by A

16. The communication of a revocation
 The communication of a revocation is
complete
 as against the person who makes it, when it
is put into a course of transmission to the
person to whom it is made, so as to be out
of the power of the person who makes it;
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17. illustration
A revokes his proposal by telegram
05،‫دسمبر‬16Raza Lilani . razamr@hotmail.com
Revocation is complete
As against A As against B
when the telegram
is dispatched
when B receives it

18. illustration
B revokes his acceptance by telegram.
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Revocation is complete
As against A As against B
when it reaches
him
when the telegram
is dispatched

19. Revocation of
Proposals & Acceptances
Sections 5 & 6
 Revocation means:
 1) mutual cancellation of a contract by the
parties to it.
 2) withdrawing an offer before it is accepted.
 3) cancelling a document before it has come into
legal effect or been acted upon, as revoking a
will.
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20. Revocation of
Acceptance
Revocation of a
Proposal
An acceptance may
be revoked at any
time before the
communication of
the acceptance is
complete as against
the acceptor but not
the afterwards
A proposal may be
revoked at any time
before the
communication of its
acceptance is
complete as against
the proposer but not
the afterwards
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21. of a proposal
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The Person who makes
Revocation
The Person to whom
Revocation made
Letter of Revocation of
Proposal
Letter posted on
10th April
Letter received
on 12th April
Communication completes
as against B on 12th April
Communication completes
as against A on 10th April

22. Communication of Revocation
of Acceptance
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The Person who makes
Revocation
The Person to whom
Revocation made
Letter posted on
10th April
Letter received
on 12th April
Communication completes
as against B on 12th April
Communication completes
as against A on 10th April
Letter of Revocation of
Acceptance