This document provides an overview of key concepts related to business law and contracts in India. It defines law and various types of contracts such as the law of contract, Indian Contract Act 1872, and elements of a valid contract. It discusses essential elements of a contract including offer, acceptance, consideration, capacity of parties and remedies for breach of contract. It also summarizes classification of contracts, negotiable instruments, and key aspects of sale of goods act including sale, hire purchase agreements, and rights and duties of buyers and sellers.
Sales of goods act 1930 -- An Act to define and amend the law relating to the sale of goods.
WHEREAS it is expedient to define and amend the law relating to the sale of goods
Sales of goods act 1930 -- An Act to define and amend the law relating to the sale of goods.
WHEREAS it is expedient to define and amend the law relating to the sale of goods
THIS IS THE POWERPOINT PRESENTATION OF THE TOPIC CONDITION AND WARRANTIES. THIS IS PPT BY WHICH YOU CAN EASILY UNDERSTAND THE TOPIC CONDITION AND WARRANTIES OF SALE OF GOODS ACT 1930 AND PLEASE LIKE THE PRESENTATION IF YOU FEEL GOOD AND DOWNLOAD AS MUCH YOU CAN SO THAT I CAN GET MOTIVATE BY THE RESPONSE.
The Indian Partnership Act, 1932 was enacted in India in 1932.THE INDIAN PARTNERSHIP ACT’ 1932 Section.4 of the Indian Partnership Act, 1932 defines Partnership in the following terms: “ Partnership is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all.”
"Section 464 of the Companies Act, 2013 empowers the Center Government to prescribe maximum number of partners in a firm but the number of partners so prescribed cannot be more than 100.The Central Government has prescribed maximum number of partners in a firm to be 50 vide Rule 10 of the Companies (Miscellaneous) Rules,2014.Thus, in effect, a partnership firm cannot have more than 50 members".
General duties of Partners[2]
The Partners shall run the business of the firm to the highest level of common advantage by being true to each other. They have to be accountable to one another and provide complete information of all the aspects of the firm , to any other partner or their legal representatives.
Duty of indemnification
Each partner shall indemnify the firm for any loss that occurred due to a fraud, in the conduct of the business.
there are six different types of contract,they are :
1.Valid Contract
2.Voidable Contract
3.Void Contract
4.Unenforceable Contract
5.Illegal Contract
6.Contingent Contract
Ensure the smooth flow of your business by choosing the appropriate legal structure, obtaining permits and licenses, and protecting business assets. Although formal legal advice cannot be offered, this workshop will provide guidelines for your new venture.
Jennifer Hoenig, Senior Associate, West Hill Technology Counsel; Megan Taylor, Of Counsel, West Hill Technology Counsel
THIS IS THE POWERPOINT PRESENTATION OF THE TOPIC CONDITION AND WARRANTIES. THIS IS PPT BY WHICH YOU CAN EASILY UNDERSTAND THE TOPIC CONDITION AND WARRANTIES OF SALE OF GOODS ACT 1930 AND PLEASE LIKE THE PRESENTATION IF YOU FEEL GOOD AND DOWNLOAD AS MUCH YOU CAN SO THAT I CAN GET MOTIVATE BY THE RESPONSE.
The Indian Partnership Act, 1932 was enacted in India in 1932.THE INDIAN PARTNERSHIP ACT’ 1932 Section.4 of the Indian Partnership Act, 1932 defines Partnership in the following terms: “ Partnership is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all.”
"Section 464 of the Companies Act, 2013 empowers the Center Government to prescribe maximum number of partners in a firm but the number of partners so prescribed cannot be more than 100.The Central Government has prescribed maximum number of partners in a firm to be 50 vide Rule 10 of the Companies (Miscellaneous) Rules,2014.Thus, in effect, a partnership firm cannot have more than 50 members".
General duties of Partners[2]
The Partners shall run the business of the firm to the highest level of common advantage by being true to each other. They have to be accountable to one another and provide complete information of all the aspects of the firm , to any other partner or their legal representatives.
Duty of indemnification
Each partner shall indemnify the firm for any loss that occurred due to a fraud, in the conduct of the business.
there are six different types of contract,they are :
1.Valid Contract
2.Voidable Contract
3.Void Contract
4.Unenforceable Contract
5.Illegal Contract
6.Contingent Contract
Ensure the smooth flow of your business by choosing the appropriate legal structure, obtaining permits and licenses, and protecting business assets. Although formal legal advice cannot be offered, this workshop will provide guidelines for your new venture.
Jennifer Hoenig, Senior Associate, West Hill Technology Counsel; Megan Taylor, Of Counsel, West Hill Technology Counsel
Coming to America. Legal Issues for International StartupsTytus Cytowski
Presentation provides overview of key legal problems for international startups relocating to the USA. Presentation delivered at JFE Accelerator in San Francisco on September 3, 2014.
With Rule of Law being the guiding principle for performance of all public and corporate functions in India, the management is expected to abide by the statutory laws and rules. This presentation puts forth a few salient aspects in this regard
What Is Contract?, Formation of Indian Contract Act, Agreement,Offer or Proposal, TYPES OF OFFER, Acceptance, Capacity, Minors, Unsound Mind, Consideration, Consent, Legal Object, Void Agreement, Discharge of Contract, Remedies for breach of contracts, Contingent Contract, Contract of Indemnity, Essential elements of a contract of indemnity , RIGHTS OF INDEMNITY HOLDER, Contract of Guarantee, Essential elements of a contract of Guarantee, CONTRACT OF BAILMENT, Essential elements of a contract of Bailment, MODES OF DELIVERY
NATURE, ORIGIN AND DEVELOPMENT OF INTERNATIONAL LAW.pptxanvithaav
These slides helps the student of international law to understand what is the nature of international law? and how international law was originated and developed?.
The slides was well structured along with the highlighted points for better understanding .
Military Commissions details LtCol Thomas Jasper as Detailed Defense CounselThomas (Tom) Jasper
Military Commissions Trial Judiciary, Guantanamo Bay, Cuba. Notice of the Chief Defense Counsel's detailing of LtCol Thomas F. Jasper, Jr. USMC, as Detailed Defense Counsel for Abd Al Hadi Al-Iraqi on 6 August 2014 in the case of United States v. Hadi al Iraqi (10026)
ALL EYES ON RAFAH BUT WHY Explain more.pdf46adnanshahzad
All eyes on Rafah: But why?. The Rafah border crossing, a crucial point between Egypt and the Gaza Strip, often finds itself at the center of global attention. As we explore the significance of Rafah, we’ll uncover why all eyes are on Rafah and the complexities surrounding this pivotal region.
INTRODUCTION
What makes Rafah so significant that it captures global attention? The phrase ‘All eyes are on Rafah’ resonates not just with those in the region but with people worldwide who recognize its strategic, humanitarian, and political importance. In this guide, we will delve into the factors that make Rafah a focal point for international interest, examining its historical context, humanitarian challenges, and political dimensions.
In 2020, the Ministry of Home Affairs established a committee led by Prof. (Dr.) Ranbir Singh, former Vice Chancellor of National Law University (NLU), Delhi. This committee was tasked with reviewing the three codes of criminal law. The primary objective of the committee was to propose comprehensive reforms to the country’s criminal laws in a manner that is both principled and effective.
The committee’s focus was on ensuring the safety and security of individuals, communities, and the nation as a whole. Throughout its deliberations, the committee aimed to uphold constitutional values such as justice, dignity, and the intrinsic value of each individual. Their goal was to recommend amendments to the criminal laws that align with these values and priorities.
Subsequently, in February, the committee successfully submitted its recommendations regarding amendments to the criminal law. These recommendations are intended to serve as a foundation for enhancing the current legal framework, promoting safety and security, and upholding the constitutional principles of justice, dignity, and the inherent worth of every individual.
Synopsis On Annual General Meeting/Extra Ordinary General Meeting With Ordinary And Special Businesses And Ordinary And Special Resolutions with Companies (Postal Ballot) Regulations, 2018
How to Obtain Permanent Residency in the NetherlandsBridgeWest.eu
You can rely on our assistance if you are ready to apply for permanent residency. Find out more at: https://immigration-netherlands.com/obtain-a-permanent-residence-permit-in-the-netherlands/.
A "File Trademark" is a legal term referring to the registration of a unique symbol, logo, or name used to identify and distinguish products or services. This process provides legal protection, granting exclusive rights to the trademark owner, and helps prevent unauthorized use by competitors.
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2. LAW - DEFINITION
Includes all the rules and principles, which regulate our relations with
other individuals and with the state.
•Law is the body of principles recognized and applied by the state in the
administration of justice.
3. LAW OF CONTRACT
It is that branch of law which determines the
circumstances in which promises made by the parties to a
contract shall be legally binding on them.
4. INDIAN CONTRACT ACT, 1872
Deals with:
The general principles of the law of contract
Some of the special contracts (indemnity and guarantee,
bailment and pledge)
5. CONTRACT
A contract is an agreement made between two or more
parties which the law will enforce.
Sec 2 (h ) defines contract as follows:
Contract is an agreement enforceable by law.
7. AGREEMENT
Every promise and every set of promises , forming
consideration for each other.
AGREEMENT = OFFER + ACCEPTANCE
8. PROMISE
When the person to whom the proposal is made signifies
his assent thereto , the proposal is said to be accepted. A
proposal when accepted becomes a promise.
9. CONSENSUS AD IDEM
This means that the parties to the agreement must have
agreed about the subject matter of the agreement in the
same sense and at the same time.
10. OBLIGATION
It is a legal tie which imposes upon a definite person or
persons the necessity of doing or abstaining from doing a
definite act or acts.
11. ESSENTIAL ELEMENTS OF VALID
CONTRACT
Offer and acceptance
Intention to create legal relationship
Lawful consideration
Capacity of parties – competency
Free and genuine consent
Lawful object
Agreement not declared void
Certainty and possibility of performance
Legal formalities
12. CLASSIFICATION OF CONTRACTS
Classification according to validity
Classification according to formation
Classification according to performance
16. VOID AGREEMENTS
A void agreement is one which is not enforceable by
law.
Agreements the meaning of which is uncertain
Wager agreements or wager
Following agreements are declared void:
Agreement by incompetent parties
Agreements to do impossible acts
Agreements in restraint of trade
Agreement in restraint of marriage
17. ESSENTIALS OF A WAGERING
AGREEMENT
Promise to pay money
Uncertain event
Each party must stand to win or lose
No control over the event
No other interest in the event
18. PERFORMANCE OF CONTRACT
Performance of a contract takes place when the parties
to the contract fulfill their obligations arising under
the contract within the time and in the manner
prescribed
19. OFFER TO PERFORM
Where a promisor has made an offer of performance to
the promisee, and the offer has not been accepted the
promisor is not responsible for non performance , nor
does he thereby lose his rights under the contract.
20. BY WHOM MUST CONTRACTS BE
PERFORMED?
Promisor himself
Agent
Legal representatives
Third persons
Joint promisors
21. WHO CAN DEMAND PERFORMANCE?
It is only the promisee who can demand performance of the
promise under a contract.
22. TIME AND PLACE OF PERFORMANCE
Where no application is to be made and no item is
specified
Where time is specified and no application is to be made
Application for performance on a certain day and place
Application by the promisor to the promisee to appoint
place
Performance in manner or at time prescribed or
sanctioned by the promisee
23. RECIPROCAL PROMISES
Promises which form the consideration or part of the
consideration for each other are called reciprocal
promises.
They are classified as follows:
Mutual and independent
Conditional and dependent
Mutual and concurrent
24. RULES REGARDING PERFORMANCE OF
RECIPROCAL PROMISES
Simultaneous performance of reciprocal promises
Order of performance of reciprocal promises
Effect of one party preventing another from performing
promise
Effect of default as to promise to be performed first
Reciprocal promise to do things legal an also other
things illegal
25. TIME AS THE ESSENCE OF CONTRACT
It means that the performance of the promise by a party
to the contract is essential within the specified
period, in order to entitle him to enforce performance
from the other party.
When time is of the essence
When time is not of the essence
26. APPROPRIATION OF PAYMENTS
Where the debtor intimates
Where the debtor does not intimate and the
circumstances are not indicative
Where the debtor does not intimate and the creditor falls
to appropriate
27. BREACH OF CONTRACT
Breach of contract means breaking of the obligation which
a contract imposes.
It may be:
Actual breach of contract
Anticipatory or constructive breach of contract
28. REMEDIES FOR BREACH OF CONTRACT
A remedy is the means given by law for the enforcement of
a right.
When a contract is broken, the injured party has one or
more of the following remedies:
Rescission of the contract
Suit for damages
Suit upon quantum meruit
Suit for specific performance of the contract
Suit for injunction.
29. QUASI - CONTRACTS
Under certain circumstances, a person may receive a
benefit to which the law regards another person as
better entitled, or for which the law regards another
person as better entitled , or for which the law
considers he should pay to the other person, even
though there is no contract between the parties.
Such relationships are termed as quasi-contracts.
Law of quasi-contracts is also known as the law of
restitution.
30. KINDS OF QUASI - CONTRACTS
Supply of necessaries
Payment by an interested person
Obligation to pay for non – gratuitous acts
Responsibility of finder of goods
Mistake or coercion
31. QUANTUM MERUIT
Means “as much as earned” or “ as much as is merited”
The claim for quantum meruit arises in the following cases:
When an agreement is discovered to be void
When something is done without any intention to do so
gratuitously
When there is an express or implied contract to render
services but there is no agreement as to remuneration.
When the completion of the contract has been prevented by
the act of the other party to the contract
When a contract is divisible
33. CONTRACT OF SALE OF GOODS
A contract of sale of goods is a contract whereby the seller transfer the
property to goods to the buyer for a price.
A contract of sale may be absolute or conditional.
34. SALE AND AGREEMENT TO SELL
Where under a contract of sale, the property of goods is
transferred from the seller to the buyer, the contract is
called “sale”, but where the transfer of the property in
the goods is to take place at a future time or subject to
some conditions thereafter to be fulfilled, the contract is
called an “agreement to sell”.
35. ESSENTIALS OF A CONTRACT OF SALE
Two parties
Goods
Price
Transfer of general property
Essential elements of a valid contract
36. SALE AND AGREEMENT TO SELL-
DISTINCTION
SALE AGREEMENT TO SELL
TRANSFER OF PROPERTY EXECUTED CONTRACT EXECUTARY CONTRACT
TYPE OF GOODS EXISTING AND SPECIFIC
GOODS ONLY
FUTURE AND
CONTINGENT GOODS
RISK OF LOSS LOSS FALLS ON BUYER LOSS FALLS ON THE
SELLER
CONSEQUENCES OF
BREACH
SELLER CAN SUE FOR THE
PRICE
SELLER CAN SUE FOR
DAMAGES
RIGHT TO RE-SELL SELLER CANNOT RESELL
THE GOODS
RESALE IS POSSIBLE
GENERAL AND
PARTICUALR PROPERTY
CONTRACT PLUS
CONVEYANCE
MERELY A CONTRACT
INSOLVENCY OF BUYER SELLER MUST PAT TO
BUYER
SELLER DOES NOT PART
WITH THE GOODS
INSOLVENCY OF SELLER BUYER CAN RECOVER
GOODS FROM SELLER
BUYER CAN CLAIM
RERATEABLE DIVIDEND
37. HIRE – PURCHASE AGREEMENT
A hire-purchase agreement is a contract whereby the
owner of the goods lets them on hire to another person
called hirer or hire purchaser on payment of rent to be
paid in installments and upon an agreement that when a
certain number of installments are paid, the property in
the goods will pass to the hirer.
38. DISTINCTION BETWEEN SALE AND HIRE-
PURCHASE
SALE HIRE – PURCHASE
OWNERSHIP IS TRANSFERRED
FROM THE SELLER TO THE BUYER
OWNERSHIP IS TRANSFERRED
FROM SELLER TO THE HIRE
PURCHASER
POSITION OF BUYER IS THAT OF
OWNER
POSITION OF HIRE PURCHASER IS
THAT OF BAILEE
BUYER CANNOT TERMINATE THE
CONTRACT
HIRE PURCHASER HAS AN OPTION
TO TERMINATE THE CONTRACT
IF BUYER MAKES THE PAYMENT IN
INSTALLMENTS, AMOUNT PAYABLE
GETS REDUCED
INSTALLMENTS PAID BY THE HIRE-
PURCHASER ARE REGARDED AS
HIRE CHARGES
39. SUBJECT MATTER OF CONTRACT OF
SALE
•Goods form the subject-matter
•Actionable claims and money, are not goods
CLASSIFICATION OF GOODS
•EXISTING GOODS
Specific goods
ascertained goods
Unascertained or generic goods
•FUTURE GOODS
•CONTINGENT GOODS
40. EFFECT OF DESTRUCTION OF GOODS
Goods perishing before making of contract
Goods perishing after the agreement to sell but before
the sale is effected
42. STIPULATIONS AS TO TIME
Stipulations relating to time of payment
Stipulations not relating to time of payment
43. CONDITION
A condition is a stipulation which is essential to the main
purpose of the contract.
Its non-fulfillment upsets the very basis of the contract.
44. WARRANTY
It is a stipulation which is collateral to the main purpose
of the contract.
It is not of vital importance as a condition is.
45. CONDITION AND WARRANTY -
DIFFERENCE
CONDITION WARRANTY
DIFFERENCE AS TO
VALUE
ESSENTIAL TO THE
MAIN PURPOSE OF
THE CONTRACT
COLLATERAL TO THE
MAIN PURPOSE OF
THE CONTRACT
DIFFERENCE AS TO
BREACH
IN CASE OF BREACH
THE AGGRIEVED
PARTY CAN
REPUDIATE THE
CONTRACT OF SALE
THE AGGRIEVED
PARTY CAN CLAIM
DAMAGES ONLY
DIFFERENCE AS TO
TREATMENT
BREACH OF
CONDITION IS
TREATED AS BREACH
OF WARRANTY
BREACH OF
WARRANTY CANNOT
BE TREATED AS
BREACH OF
CONDITION
46. IMPLIED CONDITIONS
Condition as to title
Sale by description
Condition as to quality or fitness
Condition as to merchantability
Condition implied by custom
Sale by sample
Condition as to wholesomeness
47. IMPLIED WARRANTIES
Warranty of quiet possession
Warranty of freedom from encumbrances
Warranty as to quality or fitness by usage of trade
Warranty to disclose dangerous nature of goods
48. CAVEAT EMPTOR
This means “let the buyer beware”, i.e., in a contract of
sale of goods the seller is under no duty to reveal
unflattering truths about the goods sold.
50. STAGES IN PERFORMANCE OF A
CONTRACT OF SALE OF GOODS
•The transfer of property in the goods
•The transfer of possession of the goods
•The passing of the risk
51. PASSING OF PROPERTY
Rules for ascertaining when the property in goods
passes to the buyer:
Goods must be ascertained
Intention of the parties
53. PERFORMANCE OF CONTRACT
Performance of contract of sale means as regards the seller, delivery of the
goods to the buyer, acceptance of the delivery of the goods and payment for
them, in accordance with the terms of the contract of sale.
54. DELIVERY OF GOODS
It means voluntary transfer of possession of goods
from one person to another.
TYPES OF DELIVERY
Actual delivery
Symbolic delivery
Constructive delivery or delivery by attornment
55. RULES AS TO DELIVERY OF GOODS
Mode of delivery
Delivery and payment concurrent conditions
Effect of part delivery
Buyer to apply for delivery
Place of delivery
Time of delivery
Goods in possession of third party
Cost of delivery
Delivery of wrong quantity
Installment deliveries
Delivery to a carrier or wharfinger
56. RIGHTS OF THE BUYER
Right to have delivery as per contract
Right to reject the goods
Right to repudiate
Right to notice of insurance
Right to examine
Rights against the seller for breach of contract
suit for damages
suit for price
Suit for specific performance
Suit for breach warranty
57. DUTIES OF THE BUYER
Duty to accept the goods and pay for them in
exchange for possession
Duty to apply for delivery
Duty to demand delivery at a reasonable hour
Duty to accept installment delivery and pay for it
Duty to take risk of deterioration in the course of
transit
Duty to intimate the seller where he rejects the goods
Duty to take delivery
Duty to pay price
Duty to pay damages for non-acceptance
59. AN UNPAID SELLER
A seller of goods is deemed to be an unpaid seller when –
• the whole of the price has not been paid or tendered
• a bill of exchange or other negotiable instrument has been received as a
conditional payment, and the condition on which it was received has not
been fulfilled by reason of the dishonor of the instrument or otherwise.
60. RIGHTS OF AN UNPAID SELLER
Rights of an unpaid seller against the goods
right of lien
right of stoppage in transmit
right of re-sale
Rights of an unpaid seller against the buyer personally
suit for price
suit for damages for non-acceptance
repudiation of contract before due date
suit for interest
61. REMEDIES FOR BREACH OF CONTRACT
OF SALE
Seller’s suits
Suit for price
Suit for damages for non-acceptance of the goods
Suit for damages for repudiation of contract by the buyer
before due date
Suit for interest
Buyer’s suits
suit for damages for non-delivery of the goods
suit for specific performance
suit for breach of warranty
suit for repudiation of contract by the seller before due date
suit for interest
62. NEGOTIABLE INSTRUMENTS
A negotiable instrument is a document which entitles a
person to a sum of money and which is transferable from
one person to another by mere delivery or by indorsement
and delivery
64. TYPES OF NEGOTIABLE INSTRUMENTS
Negotiable by statute – promissory notes, bills of
exchange, cheque
Negotiable by custom or usage - exchequer bills, bank
notes, debentures, circular notes
65. PROMISSORY NOTE
A promissory note is an instrument in writing
containing an unconditional undertaking, signed by
the maker, to pay a certain sum of money only to, or to
order of, a certain person, or to the bearer of the
instrument
66. ESSENTIAL ELEMENTS OF PROMISSORY
NOTE
Writing
Promise to pay
Definite and unconditional
Signed by the maker
Certain parties
Certain sum of money
Promise to pay money only
Bank note or currency note is not a promissory note
Formalities like number, date, place, consideration
It may be payable on demand
It cannot be made payable to bearer on demand
67. BILL OF EXCHANGE
A bill of exchange is an instrument in writing
containing an unconditional order, signed by the
maker, directing a certain person to pay a certain sum
of money only to , or to the order of, a certain person
or to the bearer of the instrument
PARTIES TO THE BILL:
DRAWER
DRAWEE
PAYEE
68. ESSENTIAL ELEMENTS OF BILL OF
EXCHANGE
It must be in writing
It must contain an order to pay
The order must be unconditional
It requires three parties
the parties must be certain
It must be signed by the drawer
The sum payable must be certain
It must contain an order to pay money
It must be affixed with the necessary stamp
69. CHEQUE
A cheque is a bill of exchange drawn upon a
specified banker and payable on demand and it
includes the electronic image of a truncated cheque
and a cheque in the electronic form.
70. CROSSING OF CHEQUES
A crossed cheque is one on which two parallel transverse
lines with or without the words “& Co” are drawn.
TYPES OF CHEQUES:
open cheques
crossed cheques
71. TYPES OF CROSSING
General crossing
Special crossing
Restrictive crossing
74. CAPACITY OF PARTIES
Every person is competent to contract
who is of the age of the majority
according to the law to which he is
subject, and is of sound mind and is
not disqualified from contracting by
any law to which he is subject
75. PARTIES TO A BILL OF EXCHANGE
Drawer
Drawee
Acceptor
Payee
Holder
Indorser
Indorsee
Drawee in case of need
Acceptor for honour
76. PARTIES TO A PROMISSORY NOTE
Maker
Payee
Holder
Indorser
Indorsee
77. PARTIES TO A CHEQUE
Maker
Drawee
Payee
Holder
Indorser
Indorsee
78. HOLDER
Any person entitled in his own name
(1) To the possession thereof
(2) To receive or recover the amount due thereon from the
parties thereto.
79. HOLDER IN DUE COURSE
Any person is a holder in due course if he fulfills the
following conditions:
(1) That for consideration he became the possessor or the
payee or indorsee
(2) That he became the holder of the instrument before its
maturity
(3) That he became the holder of the instrument in good
faith
80. PRIVILEGES OF A HOLDER IN DUE
COURSE
Inchoate stamped instrument
Liability of prior parties
Fictitious payee
Negotiable instrument without consideration
Conditional delivery
Instrument cleansed of all defects
Instrument obtained by unlawful means or for unlawful
consideration
Every holder is a holder in due course
Estoppel against denying original validity of instrument
Estoppel against denying capacity of payee to indorse
Indorser not permitted to deny the capacity of prior parties
81. LIABILITY OF PARTIES TO NEGOTIABLE
INSTRUMENTS
Liability of drawer
Liability of drawee of cheque
Liability of maker of note and acceptor of bill
Liability of indorser
Liability of prior parties to a holder in due course
General rules regarding liability
Acceptor’s liability on a forged indorsement
Acceptor’s liability for a bill in a fictitious name
82. TRANSFER OF NEGOTIABLE INSTRUMENT
Transfer by negotiation
negotiation by delivery
negotiation by indorsement and delivery
Transfer by assignment
83. INDORSEMENT
It means writing on an instrument
Indorser – person who so signs the instrument
Indorsee – person to whom the instrument is indorsed
84. DISCHARGE OF A NEGOTIABLE
INSTRUMENT
The term discharge is used in two senses:
(1) Discharge of the instrument
(2) Discharge of one or more of the parties from liability
thereon
An instrument is said to be discharged when all rights
of action under it are completely extinguished and when
it ceases to be negotiable.
85. MODES OF DISCHARGE OF AN
INSTRUMENT
By payment in due course
By party primarily liable becoming holder
By express waiver
By cancellation
By discharge as a simple contract
86. DISCHARGE OF A PARTY
By payment
By cancellation
By release
By allowing drawee more than forty-eight hours
By non-presentment of cheque
Cheque payable to order
Draft drawn by one branch on another
Parties not consenting discharged by qualified acceptance
By operation of law
By material alteration
Discharge by payment of altered instrument
88. AGENT AND PRINICIPAL -
DEFINITION
•An agent is a person employed to do any act for another, or to represent
another in dealings with third persons.
•The person for whom such act is done, or who is so represented is called the
principal.
89. ESSENTIALS OF RELATIONSHIP OF
AGENCY
Agreement between the principal and the agent
Intention of the agent to act on behalf of the principal.
90. RULES OF AGENCY
Whatever a person can do personally, he can do
through an agent
He who does not act through another does it by
himself
91. CREATION OF AN AGENCY
By express agreement
By implied agreement
By ratification
By operation of law
92. CLASSIFICATION OF AGENTS
Special agent
General agent
Universal agent
Commission agent
Del credere agent
93. DUTIES OF AGENT
To carry out the work undertaken according to the directions given
by the principal
To carry out the work with reasonable care, skill and diligence
To render proper accounts to his principal
To communicate with the principal in case of difficulty
Not to deal on his own account
To pay sums received for the principal
To protect and preserve the interests of the principal in case of his
death or insolvency
Not to use information obtained to the course of the agency against
the principal
Not make secret profits
Not to set up an adverse title
Not to put himself in a position where the interest and duty conflict
Not to delegate authority
94. RIGHTS OF AN AGENT
Rights of retainer
Right to receive remuneration
Right of lien
Right of indemnification
Right of compensation
Right to stoppage in transit
95. DUTIES OF PRINCIPAL
To indemnify the agent against the consequences of all
lawful acts
To indemnify the agent against the consequences of acts
done in good faith
To indemnify agent for injury caused by principal’s
neglect
96. RIGHTS OF PRINCIPAL
To recover damages
To obtain an account of secret profits and recover them
and resist a claim
To resists agent’s claim for indemnity against liability
incurred
98. POSITION OF PRINCIPAL AND AGENT IN
RELATION TO THIRD PARTIES
The relationship is discussed under three heads:
Where the principal is named
Where the principal is unnamed
Where the principal is undisclosed
99. NAMED PRINCIPAL
The position of the named principal for the acts of his agent
are as follows:
Acts of the agent are the acts of the principal
When the agent exceeds his authority
Notice given to agent as notice to principal
Principal inducing belief that agent’s unauthorized acts
were authorized
Misrepresentation or fraud of agent
100. UNNAMED PRINCIPAL
When an agent contracts as an agent for a principal
but does not disclose his name, the principal is liable for
the contract of the agent, unless there is a trade custom
or a term, express or implied, to the effect which makes
the agent personally liable.
101. UNDISCLOSED PRINCIPAL
An agent not only conceals the name of the principal but
also the fact that he is an agent.
102. PERSONAL LIABILITY OF AGENT
When the contract expressly provides
When the agent acts for a foreign capital
When he acts for an undisclosed principal
When he acts for a principal who cannot be sued
Where he signs a contract in his own name
Where he acts for a principal not in existence
Where he is liable for breach of warranty of authority
Where he receives or pays money by mistake or fraud
Where his authority is coupled with interest
Where the trade usage or custom makes him personally liable
103. TERMINATION OF AGENCY
Termination of agency by act of the parties
agreement
revocation by the principal
revocation by the agent
Termination of agency by operation of law
performance of the contract
expiry of time
death and insanity
destruction of subject matter
principal becoming an alien enemy
dissolution of a company
termination of sub-agent’s authority
104. IRREVOCABLE AGENCY
When an agency cannot be terminated or put an end to,
it is said to be an irrevocable agency
An agency is irrevocable in the following cases:
Where the agency is coupled with interest
Where the agency has incurred a personal liability
Where the agent has partly exercised the authority