List of Leading Cases covered in Law of Contract-I

Agreement vs Contract

Aspect Agreement Contract Enforceability May or may not be enforceable Must be enforceable by law Legal obligation May create only social/moral duty Creates legal rights and obligations Statutory definition S. 2(e), ICA S. 2(h), ICA Validity requirements Can exist even if essentials are missing Must satisfy S. 10 (free consent, competence, lawful consideration/object, not expressly...

What is Offer (Proposal)? What is Invitation to Treat / Invitation to Offer?

Meaning and statutory basis (Section 2(a)) An offer (proposal) is defined in Section 2(a) of the Indian Contract Act, 1872. A person is said to make a proposal when they signify to another person their willingness to do or to abstain from doing something, with a view to obtaining the assent of that other person....

Acceptance and Essentials of Valid Acceptance

“Acceptance” means when the person to whom the proposal is made signifies his assent to it. Once accepted, the proposal becomes a promise. (Section 2(b)) Also remember: acceptance can be express (words) or implied (conduct). (Section 9) Legal Basis as Per Indian Contract Act, 1872 And the main provisions that govern how acceptance works are:...

Consideration in a Contract

Consideration: Meaning and Core Idea Consideration is the “price of a promise” — i.e., something in return for which one party makes a promise. Consideration is the benefit to the promisor or the detriment to the promisee or any other person, given at the desire of the promisor. Consideration in a contract is Quid pro...

Competency to Contract

1. Introduction: Why “Competency” matters A contract becomes enforceable only when it satisfies the essentials of a valid contract under Section 10, Indian Contract Act, 1872 (ICA)—i.e., agreement and enforceability by law. One core condition is that the parties must be competent to contract (capacity). 2. Who are competent to contract? (Section 11 ICA) Statutory...

Consent and Free Consent

1) Meaning of Consent (Consensus ad idem) Consent means that both parties agree upon the same thing in the same sense.This is traditionally called consensus ad idem (meeting of minds). Example: If A thinks he is buying House No. 10, but B thinks he is selling House No. 11, there is no consensus ad idem,...

Unit-II

Contingent Contracts

Meaning (Section 31) A contingent contract is a contract to do or not to do something if some collateral uncertain event happens or does not happen. The event must be uncertain and collateral (i.e., not the main promise itself, but a condition on which performance depends). Illustration A promises to pay B ₹1,00,000 if B’s...

Wagering Agreements

Meaning / Definition A wagering agreement is an agreement in which two persons mutually agree that on the happening or non-happening of an uncertain event, one shall win and the other shall lose, and the parties have no real interest in the event except the stake (money or money’s worth). In simple words, it is...

E-Contracts (Electronic Contracts)

Meaning / Definition An e-contract (electronic contract) is an agreement formed through electronic means (internet / apps / email / electronic records), where offer, acceptance, and other communications happen digitally, but the outcome is still a “contract” if it is enforceable by law under the Indian Contract Act, 1872. All the provision of Indian Contract...

Privity of Consideration

Privity of consideration (consideration from a third party) Meaning In English law, the traditional rule was: “consideration must move from the promisee” (so a person who didn’t furnish consideration is a stranger to consideration and generally can’t enforce the promise). Indian law is different. Under the Indian Contract Act, 1872, consideration may move from the...

Doctrine of Privity of Contract

1) Meaning (Definition) Privity of contract means that a contract creates rights and obligations only between the parties who have made it. Therefore, a third person (stranger) who is not a party to the contract cannot generally sue to enforce it, even if the contract was intended to benefit them. 2) Core principle and Rule...

Privity of Contract vs Privity of Consideration

Basis Stranger to Contract (Privity of Contract) Stranger to Consideration (Privity of Consideration) Meaning A person who is not a party to the contract. A person who has not provided consideration for the promise. Main question “Can a third party enforce the contract?” “Must consideration move only from the promisee, or can it move from...

Legality of Object and Consideration

Introduction For a valid contract, the object and consideration must be lawful. Indian Contract Act, 1872 lays down that if the object or consideration is unlawful, the agreement becomes void, and courts will not enforce it. Section 23, ICA says that consideration or object is unlawful if it is: A. Object or consideration forbidden by...

Agreement in Restraint of the Marriage

1. Legal Provision Section 26, Indian Contract Act, 1872 states that: Every agreement in restraint of the marriage of any person, other than a minor, is void. If an agreement restricts an adult’s freedom to marry, it is void under Section 26. 2. Meaning: What is “Restraint of Marriage”? An agreement is said to be...

Performace and Discharge of Contract

1) Meaning and statutory scheme Performance of contract means carrying out the promises undertaken by the parties. As a general rule, each party must perform or offer to perform their promise, unless performance is dispensed with or excused under the Act. (Chapter IV: Sections 37–67, ICA). PART A — PERFORMANCE OF CONTRACT (Sections 37–67) 2)...

Breach of Contract and Types of Breach

Types of Breach of Contract A “breach of contract” happens when a party fails to perform what they promised under the contract (or performs it defectively). Under the Indian Contract Act, the general duty is that parties must perform or offer to perform their promises (Section 37). (A) Actual Breach Meaning: Actual breach occurs when...

Remedies for Breach of Contract with Special Reference to Damage

A breach of contract occurs when one of the parties to a legally enforceable agreement fails to perform their obligation, either wholly or partially, without lawful justification. When this happens, the aggrieved party becomes entitled to seek legal remedies, including the most common one—damages. Remedies for Breach of Contract As per the Indian Contract Act,...

Specific Performance as an Equitable Remedy

1. Meaning of Specific Performance Specific performance is an equitable remedy by which the court directs the actual performance of a contract according to its terms, instead of awarding monetary compensation. It is governed by the Specific Relief Act, 1963, and is granted where damages are not an adequate remedy. 2. Nature of the Remedy...

Injunctions

1) Meaning and Statutory Basis Injunction is a form of preventive relief granted at the discretion of the court. It may be temporary or perpetual. 2) When Injunction is Granted A) Temporary (Interim) Injunction — When courts grant it Although governed by Order 39 CPC, courts apply standard tests: Tests (triple test): Landmark case: Dalpat...