contract act, difference between contract and agreement, essentials of contract, performance and breach of contract,quasi contract

2. Contract
The Indian Contract Act, 1872
defines the term “Contract” under
its section 2 (h) as “An agreement
enforceable by law’’.

3. AGREEMENT
The Indian Contract Act, 1872
section 2 (e), the Act defines the
term agreement as “every promise
and every set of promises, forming
the consideration for each other”.

4. Difference between contract and
agreement
CONTRACT
• A contract is an agreement
that is enforceable by law.
• A contract is only legally
enforceable.
AGREEMENT
• A promise or a number of
promises that are not
contradicting and are
accepted by the parties
involved is an agreement.
• An agreement must be
socially acceptable. It may or
may not be enforceable by

5. Difference between contract and agreement
CONTRACT
• A contract has to create some legal
obligation.
• All contracts are also agreements.
AGREEMENT
• An agreement doesn’t create
any legal obligations.
• An agreement may or may
not be a contract.

6. Essential elements of a valid contract
1. Offer and Acceptance
2. Intention to create a Legal relationship
3. Lawful Consideration
4. Competent parties
5. Free consent
6. Lawful Object
7. Not expressly declared void

7. Definition of offer
When a person signifies to another his willingness
to do or to abstain from doing anything, with a
view to obtaining the assent of that other to such
act or abstinence he is said to make a proposal. -
Section 2 (a) of Indian Contract act.

8. Definition of acceptance
When the person to whom the proposal is
made, signifies his assent there to , the
proposal is said to be accepted - Section 2(b)
of Indian Contract Act

9. Definition of consideration
“When at the desire of the promisor, the
promisee or any other person has done or
abstained from doing, or does or abstains
from doing, or promises to do or abstain
from doing something, such act or
abstinence is called a consideration for
the promise.”

10. Capacity of parties
Under section 11 of the Indian Contract Act, any person is
competent to contract are as follows.
•A person who attained the age of majority and is not a minor.
•A person of sound mind.
•A person who has not been disqualified by law or declared as
insolvent/bankrupt

11. Free consent
Sec 13 defines “consent” as “Two or more persons are said to consent when
they agree upon the same thing in the same sense”. According to Sec 14,
consent is said to be free when it is not caused by:
• 1. Coercion
• 2. Undue influence
• 3. Fraud
• 4. Misrepresentation
• 5. Mistake

12. Lawful object
For the formation of a contract, it is also necessary that
the parties to an agreement must agree to a lawful object.
The object must not be fraudulent or illegal or immoral or
against the public policy or must not imply injury to the
person or the other of the reason mentioned above the
agreement is void.

13. Performance of contract
Sec 37:- That the parties to a contract must either
perform or offer to perform, their respective
promises unless such performance is dispensed with
or excused under the provisions of contract Act, or
of any other law

14. Breach of contract
A contract is breached or broken when any of the
parties fails or refuses to perform its promise under
the contract.Breach of contract is a legal cause of
action in which a binding agreement is not honored
by one or more parties by non-performance of its
promise by him renders impossible.

15. Remedies for breach of contract
Remedy means course of action available to an aggrieved
party when other party breaches the contract.
1.Rescission of the Contract
2.Suit for Damages
3.Suit upon Quantum Meruit
4.Suit for Specific Performance
5.Suit for Injunction
(5) Suit for Injunction

16. Quasi contract
A quasi contract is a contract that is created by a
court order, not by an agreement made by the
parties to the contract. For example, quasi contracts
are created by the court when no official agreement
exists between the parties, in disputes over
payments for goods or services.

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