oblicon ppt
TRANSCRIPT
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INTRODUCTION
LAW OF
CONTRACT
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What is a Contract ?
A legally binding agreement. In other words
A promise or set of promises which the law will
enforce.
The agreement will create rights and
obligations that may be enforced in the courts.
The normal method of enforcement is an
action for damages for breach of contract.
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Steps involved in Contract
Offer and its acceptance
Free consent of both parties
Mutual and lawful consideration foragreement
It should be enforceable by law. Hence,
intention should be to create legalrelationship. Agreements of social or
domestic nature are not contracts
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Steps involved in Contract
Parties should be competent to contract
Object should be lawful
Contract should not have been declaredas void under Contract Act or any other
law.
Jus in Personam and Jus in remConsensus ad idem
obligation
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Form of Contracts
1) Written
2) Oral
3) Partly oral and written
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2 classes of Contract
Contracts by Deed
A deed is a formal legal document signed, witnessed and
delivered to effect a conveyance or transfer of property or
to create a legal obligation.
Simple contracts
Simple contracts are informal contracts and may be made
in any wayin writing, orally or they may be implied
from conduct
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Bilateral & Unilateral
Bilateral contracts
A promise by one party in exchanged for a promise by anotherparty
A one to one contract
Example: Sale of goods contract
The Buyer promises to pay the price
The Seller promises to deliver the goods
Offeror or
PromisorThe person who
make the offer
Offeree or PromiseeThe person to whom
the contract was made
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Unilateral contracts
A promise by one party in exchanged for an action by
another party A one to all contract
Example:X promises a reward to anyone who will find his lost wallet.
X bound himself to the promise, but no one is bound to search for
the lost wallet. But if Y, having seen the offer, recovers the wallet
and returns it, he is entitled to the reward.
1 OfferorMany
Offerees
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Essential elements of a Contract
1) AgreementOne party make the offer, another party accepts the offerand both achieve consensus ad idem (meeting of theminds)
2) ConsiderationBoth parties must have provided consideration, ie, eachside must promise to give or do something for the other.
3) Intention to create legal relationsThe parties must have intended their agreement to havelegal consequences. The law will not concern itself with
purely domestic or social agreements.
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4) Capacity
The parties must be legally capable of entering into a
contract.
5) Absence of Vitiating factors
Absence of factors that are going to invalidate a contract,
ie : duress or undue influence, mistake, misrepresentation,illegality
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Enforceability
Void contracts
the whole transaction is regarded as a nullity, as though as
there has been no contract between the parties.
Any goods or money obtained under the agreement must
be returned.
Where items have been resold to a 3rdparty, they may berecovered by the original owner.
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Features of Void agreements
An agreement made by incompetent
parties (Minor/Lunatic Person) is void.
Agreements which have unlawful
consideration is void.
Agreement with a unlawful object is void.
Agreements made without consideration isvoid.
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Features of Void agreements
An agreement the terms of which are
uncertain is void.
An agreement by way of wager
(betting/gambling) is void.
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Features of Void agreements
An agreement contingent upon the
happening of an impossible event is void.
Agreement to do impossible acts is void.
Agreement in restraint of legal
proceedings is void.
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Voidable contracts
An agreement which is enforceable by law at the option ofone or more of the parties thereto, but not at the option of
the other or others, is a voidable contract
A voidable contract will operates as a valid contract
unless and until one of the parties takes steps to avoid it.
Anything obtained under the contract must be returned,
insofar as this is possible.
If goods have been resold before the contract was avoided,
the original owner will not be able to reclaim them.
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Classification of Contracts
Classification according to validity
Voidable contracts
Void contracts
Illegal contractsUnenforceable contracts
Classification according to formation
Express contracts
Implied contracts
Quasi contracts
E-commerce contracts
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Classification of Contracts..
Classification according to Performance
Executed contracts
Executory contracts
Unilateral or one-sided contracts
Bilateral Contracts
Classification according to formation
Formal Contracts (a) Contracts of Record: is either a
judgment of a court or recognisance (b) Contracts underseal: A contract under seal is one which derives its binding
force from its form alone.
Simple contracts:
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Unilateral Contracts or one-
sided contracts ..A contract in which only one party has to fulfill his obligationat the time of the formation of the contract, the other party
has fulfilled his obligation at the time of the contract or
before the contract comes into existence.
(Contracts with the executed consideration)
Bilateral contracts:
In which obligations on the part of both of the parties to the
contract are outstanding at the time of the formation of the
contract.
(Contracts with the executory consideration)
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End