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Corporate Law
1. Law of Contract
Presented by Group 1
Dawood Sakarwala – 100
Bhavesh Singhvi – 110
Siddhant Shah – 95
Nivedita Bekal – 86
Lisa Pereira – 29
Shritika Jaiswal – 13
Manish Tiwari - 43
2. Agreements & Contracts
The Indian Contract Act 1872
The Indian Contract Act was passed and implemented to control various
kinds of commercial and business activities.
It deals with general principals of the law of contract and special
contract.
3. Agreements & Contracts
Proposal Acceptance Consideration
Agreement
All Contracts are Agreements. But all Agreements are NOT Contracts
Agreement = Offer + Acceptance
Contract = Agreement + Enforceable by Law
4. Essential Elements of aValidContract
Agreements & Contracts
Offer and Acceptance
Intention to create legal
relationship
Law consideration
Capacity of parties
Free consent
Lawful object
Legal formalities
Certainty of meaning
Possibility of performance
Not to be declaredVoid or Illegal
5. Offer or Proposal
When one 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
Counter offer is the rejection of the Original Offer. It is a New Offer.
6. Acceptance
When the person to whom a proposal is made signifies his assent
thereto, the proposal is said to be accepted. A Proposal when
accepted becomes a Promise.
7. Essentials ofValidAcceptance
Acceptance Must be absolute and unqualified
Acceptance must be expressed in some usual and reasonable manner
Mental acceptance is not sufficient in law
Acceptance must be communicated to the offerer
Acceptance of the proposal
Acceptance
8. Acceptance of the proposal need not always be expressed in words
Acceptance must be by a certain person
If the act is done in ignorance of the proposal, it is no acceptance of the
proposal
Acceptance must be given within a reasonable time
Acceptance must be given before the offer lapses or is revoked or is
withdrawn
Essentials of Valid Acceptance
Acceptance
9. Consideration
When at the desire of the promisor, the promise has done, or abstained
from doing or does or abstains from doing or promises to do or to
abstain from doing something, such act or abstinence or promise is
called Consideration for the Promise
10. Essentials ofValidConsideration
Consideration must move at the desire of the promisor
Consideration may move from the promise or any other person –
Stranger to the contract
Consideration may be Past, Present or Future
Consideration need not be adequate
Consideration must be real and not illusory
Consideration
11. Capacity to Contract
Who is of the age of majority according to the law to which he
is subject
Who is of sound mind
Who is not disqualified from
contracting by any law to
which he is subject
12. Capacity to Contract
Rules Related to Minors
Minor contract is absolutely void (Mohori bibee V. Dhurmodas
Ghose)
Ratification of a minor’s contract
False representation by the minor - Estoppel (Leslie Ltd V. Sheill)
Exceptions
Promisee or Transferee
Agency
PartnershipNecessaries
Gift
13. Capacity to Contract
Contracts by Persons of Unsound Mind
When person is usually of unsound mind but occasionally of
sound mind, he can enter into the contract when he is of sound
mind.
When person is usually of sound mind but occasionally of
unsound mind, he cannot enter into the contract when he is of
unsound mind.
14. Free Consent
Two or more person are said to consent when they agree upon
the same thing in the same sense
Consent is Free, when there is:
No Coercion
No Undue influence
No Fraud
No Misrepresentation
No Mistake
15. Void Agreements
A Void Agreement is not enforceable by Law. It has no Legal
existence or sanctity.
16. Void Agreements
Types of Void Agreements
Agreements made by incompetent persons
Agreements made under mutual mistake as to a matter of fact
essential
to the proposal
Agreement, the consideration or object of which is unlawful / unlawful
in
part
Agreement made without consideration
Agreement made under a mistake as to a law not
17. Void Agreements
Types of Void Agreements
Agreements in restraint of Marriage
Agreements in restraint of Trade
Agreement in restraint of Legal Proceedings
Agreements, the meaning of which is Uncertain
Agreements by way of Wager
18. Void Agreements
Types of Void Agreements
Agreements contingent on an Impossible event
Agreements to do an Impossible Act
Agreements to do an Act which subsequently becomes impossible
Agreements contingent on an uncertain future event, if the event
becomes impossible
When the Agreement is void, the party who has received any benefits
must restore or compensate the other party for the value or benefit
received
19. Communication
The communication of a proposal is complete when it comes to the
knowledge of the person to whom it is made.
The communication of an acceptance is complete, as against the
proposer, when it is put in a course of transmission to him so at to be
out of the power of the acceptor; as against the acceptor, when it
comes to the knowledge of the proposer.
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; as against the person to whom
it is made, when it comes to his knowledge.
20. Contingent Contracts
The word contingent ordinarily means ‘subject to chance’
A contingent contract is a contract to do or not to do something, if
some event, collateral to such contract does or does not happen.
Example: A contracts to pay to B
Rs.1,00,000, if B's house is burnt.
22. Quasi Contracts
Claim for supply of necessaries (sec.68)
Reimbursement of money paid (sec. 69)
Obligation of person to pay for enjoying benefit of non-gratuitous
act (sec.70)
Responsibility of finder of goods (sec.71)
Liability of a person to whom money is paid or thing delivered by
mistake or under coercion (sec.72)
Types of Quasi Contracts
23. Discharge of Contract
Discharge means “TERMINATION” of a contract. By discharge the
rights & obligations of the parties come to an end.
24. Discharge of Contract
Ways of Discharging Contracts
By Performance
By Breach
By Frustration
By Agreement
By Accord & Satisfaction
By Lapse of Time
By Death
By Unauthorized Material Alteration
By Operation of Law