The document discusses the essential elements of a valid contract and different types of contracts. It defines a valid contract as one that is binding and enforceable when all parties are legally obligated to perform. It outlines the key elements that must be present for a contract to be valid, including offer and acceptance, lawful consideration, capacity and consent of parties, a lawful objective, and certainty of terms. The document then categorizes contracts into four types based on enforceability, formation, performance requirements, and number of obligated parties.

3. “
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SEEK KNOWLEDGE FOR THE SAKE OF
KNOWLEDGE
Socrates

4. TOPIC OF PRESENTATION IS
“Essentials Of Valid Contract & Its Kinds”

5. GROUP MEMBERS ARE
Habib Ullah
Zain Ul Abeedin
Sadiq Hassan
Zeeshan Farooq
Sajjad Umar

6. A valid contract is binding & enforceable. In valid contract, all the
parties are legally bound to perform the contract. Thus, a
contract can be enforced by either of the parties. If one part
refuses to perform the contract, the other party can enforce it
through court. In order to be enforceable, an agreement must
possess the essentials of a valid contract.
The essentials of contract are as under:

7. Offer & Acceptance: An a contract there must be at least two
parties one of them making the offer and the other accepting it. There
must thus be an offer by one party and its acceptance by the other.
The offer when accepted becomes agreement.
Example: A offers to sell his cycle to B for Rs.2000/-.
Legal Obligation: The parties to an agreement must create legal
obligations . It means that is one party does not fulfill his promise he
shall be liable for breach of contract
Example: A offers sell his car to B for Rs.200000/-. B agrees to buy. It
create legal obligation.
Lawful Consideration: Consideration means it is the price paid
by one party for the promise of the other party. An agreement is
enforceabled only when both parties give & take something.
Example: A agree to sell his house to B for Rs.20 lac. For A Rs.20 lac &
for B house is consideration.

8. Capacity Of Parties: An agreement is enforceable if is
made by parties who are competent to contract, an order to it.
It is essential that the parties are the age of maturity, have
sound mind and not disqualified form the contracting by law.
Example: M is person of unsound mind agree to sell his house
to S for Rs.3 lac. It is not valid because M is not competent.
Free Consent: for a valid contract. It is essential that the
consent of parties must be free. Consent is free when it is not
obtained by fraud, coericion mistake & misrepresentation.
Example: A compels B to enter into a contract at gunpoint. It is
not valid contract.

9. Lawful Object: it is necessary that agreement is made for an
objeft is lawful. The object of agreement must not be illegal,
immoral opposed to public policy imply to the person or property of
another.
Example: A person to pay B Rs.5000/-. If B beats C the agreement is
illegal as its object is lawful.
Writing & Registration: A contract may be oral and writing. It is
preferable that the contract be writing because it is easy to prove in
court. If required by law, a particular contract msut be in writing
signed and etc by witnesses.
Example: A verbally promises to sell his book to B for Rs.500. it is
valid contract because the law does not require it be in writing.

10. Certainty Of Terms: Agreements the meaning of which is
not certain or capable of being made certain, are void. The
terms of agreement must be clean, complete and certain.
Example: A promises to sell 20 books to B without specifying
therir titles. The agreement is void because the terms are not
clear.
Possibility Of Performance: A valid contract must being of
capable to performed. An agreement to do an impossible act
is void. If the agreement cannot be enforced by law.
Example: A agrees with B to discover a treasure by magic, the
agreement is not enforceable and it is void.

11. Not Expressly Declared Void: The agreement must not
be one of those agreements , which have been expressly
declared to be void by the law.
Example: A promises to close his business on the promise of B
to pay him Rs.3 lac is void agreement because it is restraint of
trade.
B: A promises to pay Rs.2 lac to B if Pakistan wins the world cup
final. The agreement is void being a wagering agreement.

12. The contracts can be classified into the following four categories:
1.According To Enforceability
According to enforceability, a contract can be divided under:
• Valid contract: A valid contract is enforceable by law. An agreement
is enforceable by law when all the essentials of valid contract are
present.
Example: A agrees to sell a car to B. if it fulfills all the essentials of a
contract, it is a valid contract. If A fails to deliver the car, B can sue him
if B fails to pay. A can sue him

13. • Void Contract: A void means not binding in law. Section 2(j)
defines a contract which ceases to be enforceable by law becomes
void, when it is ceases to be enforceable. It means that void
contract is not void from beginning.
 Impossibility of performance: A contract becomes boid due to
impossibility of performance. When it be comes impossible to be
performed by any party due to any reason.
Example: a agrees to sell his house to B after two days. The house
burnt next da. The contract become void.
 Subsequent Illegality: A contract becomes void by subsequent
illegality. If a contract is made between two parties not before the
performance change in the existing law makes the implementation
of the contract illegal the contract becomes void.
Example: A agrees to sell 100 bags of wheat to B. before delivery the
Govt. bans private trade in wheat. The contract is becomes void.

14. Rejection of a voidable contracts: If the consent of one party
is not free the contract is voidable. A voidable contract
becomes void when the party whose consent B is not free
rejects the contract.
Example: A forcibly buys B’s car for Rs.2 lac the contract is
voidable at the option of B. B may accept or reject it.
Impossibility of depending events: The performance of a
contingent depends upon the happening of non-happening
of certain event. It becomes void when that event does not.
Example: A contract to give Rs.1 lac to B, if B gets admission in
university B fails to get admission. The contract becomes void.

15. • Void Agreement: An agreement not enforceable by law is
said to be void. Such type of agreement which is not
enforceable by law is called void agreement.
Example: C promises to buy a dog from B for Rs. 2000/- the
dog was dead before the agreement was made but the parties
were unware. The agreement is void.
• Voidable Contract: An agreement which is enforceable by
law at the option of the one or more of the parties thereto
but not at ehe option of the others party is voidable contract.
Example: C compels B to sell his car at gunpoint. The contract
is made vy coercion and is void at the option of B

16. B- When one party promises to do something for the other
party but the other party prevent him form performing his
promise, the contract becomes voidable at his option.
Example: X contracts to paint Y house within one week. X
doesn’t paint the house within one week specified time. The
contract is voidable at the option of X.
• Unenforceable contract: It is the contract which can not
be enforceable through the court of law because of some
technical defects such as absence of writing registration and
stamp etc.
Example: A borrows Rs.1 million from B and makes a pronate
on a Rs.10 stamp paper. It is unenforceable because pronate is
undervalued

17. • Illegal Agreement: An agreement is illegal when its
performance is forbidden by any law. Such an agreement can
never become contract it is illegal and void if it is forbidden
by law or is of such a nature if permitted.
Example: A gives money to B a smuggler to buy smuggled
goods. The agreement is illegal and the money cannot be
recovered.
2. According to Formation
According to formation there are three kinds of contract:
Express Contract: A contract in which words or written,
when such contract is formed there is no difficult in
understanding the rights and obligations of the parties.
Example: A tells on telephone to B that he wants to sell his

18. Implied Contract: An implied contract is made otherwise
than by words or written. It arises form the acts conduct of
parties and course of dealing or circumstances.
Example: A went into a restaurant and had a cup of tea. It is
an implied contract and A will pay for the cup of tea.
Quasi Contract: In a quasi contract the law imposes
certain obligation under some special principle of equity that
a person shall not be allowed to get benefit at the cost of
another.
Example: A finds lost goods of B. a is bound to return the
goods to B.

19. 3. According to performance
According to performance a contract of two kinds
Executed Contract: A contract is said to be executed
when both the parties have complete or completely
performed their obligations.
Example: A buys a book from B. a delivers the books and B
pays the price.
Executory Contract: In this something remains to be
done. In others words a contract is said to be executory
when both the parties to a conduct have yet to perform their
obligations.
Example: M sells his car to N for Rs.2 lac. N has not yet paid
the price and M has not delivered the car. The contract

20. 4. According to parties
According to his it may of two kinds which are as under:
Unilateral Contract: In this only one party makes a
commitment. In other words it is a contract where only one
party is bound but the other party chooses to be bound it.
Example: A promises to pay Rs.1000/- to any one who finds
his lost bag. B finds the bad and return it to A. it is a
unilateral which comes into existence when the bag is found.

21. Bilateral Contract: It is the contract where both parties are
bound by it, as soon as the contract is made. In other words,
it si a contract in which both parties have yet to perform their
obligations.
Example: A promises to paint a picture for B and B promises to
pay Rs.5000/- to A.