Special Contracts

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Special Contracts

  1. 1. Special Contracts Indemnity & Guarantee Bailment & Pledge Agency Sec - 124 Sec - 148 Sec - 182
  2. 2. Indemnity & Guarantee <ul><li>Indemnity Sec - 124 </li></ul><ul><li>One person </li></ul><ul><li>Makes a Promise </li></ul><ul><li>To another person </li></ul><ul><li>To save from loss </li></ul><ul><li>By doing something </li></ul><ul><li>E.G. Insurance Agreement </li></ul>
  3. 3. Parties of indemnity Indemnifier: Person giving promise Indemnified: Person receiving promise Nature of Indemnity It is a type of contingent contract. Right of Indemnity holder Sec - 125 Indemnity Holder Is Entitled To Recover : All damages All sums paid as compromise to such suit.
  4. 4. <ul><li>Guarantee </li></ul><ul><li>Sec - 126 </li></ul><ul><li>One person </li></ul><ul><li>Makes a Promise </li></ul><ul><li>To another person </li></ul><ul><li>To pay some money </li></ul><ul><li>If some other person </li></ul><ul><li>Makes default in payment of money </li></ul><ul><li>Payable by him </li></ul><ul><li>E.G. Surety in loan agreements </li></ul>
  5. 5. Types Of Guarantee <ul><li>Specific </li></ul><ul><li>Guarantee: For a single transaction. </li></ul><ul><li>Continuing </li></ul><ul><li>Guarantee: For many transactions </li></ul><ul><li>It may be for a fixed time </li></ul><ul><li>It may be revoked </li></ul><ul><li>After revocation it will not apply to future transactions </li></ul><ul><li>It remains applicable for past transactions </li></ul>
  6. 6. Parties The person to whom guarantee is given sec - 126 Creditor person for whose default guarantee is given sec 126 . Debtor “ is person who gives the guarantee” [section 126] . Surety
  7. 7. Rights Of Sureties Against Debtor Subrogation – sec 140 Indemnity – sec 145. Against creditor Claim security Setoff Against co-sureties Equal contribution Sec 146
  8. 8. <ul><li>Discharge of Surety </li></ul><ul><li>Revocation -- notice to the creditor Sec -130 </li></ul><ul><li>Specific guarantee cannot be revoked. </li></ul><ul><li>Continuing guarantee -- revoked by death of surety, sec 131 </li></ul><ul><li>Substituting new contract Sec 62. </li></ul><ul><li>Conduct of the creditor </li></ul><ul><li>Variation -- without the surety’s consent Sec 133. </li></ul><ul><li>Creditor makes a composition with debtor Sec 135. </li></ul><ul><li>Creditors losses security given to him. Sec 141. </li></ul><ul><li>By invalidation of contract of guarantee Sec 142. </li></ul>
  9. 9. Bailment <ul><li>Bailment is </li></ul><ul><li>Delivery of goods </li></ul><ul><li>By one person to another </li></ul><ul><li>For some purpose , </li></ul><ul><li>They shall be returned </li></ul><ul><li>According to the directions of the person delivering them </li></ul>MEANING : Sec 148
  10. 10. Same goods to be returned but form of goods may be changed. E.g. when cloth is stitched by tailor. Characteristics of bailment Person delivering goods is called the “ bailor ” Person to whom they are delivered is called the “ bailee ”. Sec 148 Parties
  11. 11. Placing an ornament in a bank locker is not bailment. Deposit of money in a bank is not bailment. Examples :

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