Objective of this Assignment

This assignment is about to explore the history, principles, positive and negative aspects,
practical applications, and conclude on the significance of the law of contract in society.

Table of contents

● Introduction of Law of Contract

● History of Law of Contract
● Number of Sections
● Relationships with practical life/Usefulness
● The good side and bad side of this law
● Conclusion

Introduction:

The law of contract encompasses the rules and regulations governing agreements between
parties,laying out their rights and obligations.Contracts involve legally binding promises or
agreements enforceable by law. The law of contract serves as the base or foundation of modern
legal systems,governing the agreements and promises made between parties.It defines the
framework within which individuals are legally binding obligations.Encompassing a diverse
range of transactions,from business dealings to everyday interactions, contract law sets out the
rules and principles that guide the formation, interpretation and enforcement of contracts.

Fundamentally,a contract is a legally enforceable agreement where parties voluntarily consent to

exchange goods, services, money or promises called consideration.Central to its validity are
elements such as offer, acceptance, consideration legal capacity and intention to create legal
relations. The law of contract delves into various types of contracts including written,oral,
implied, unilateral, and bilateral contracts, each with its own specific requirements and
implications.
Moreover,this legal framework establishes rules for interpreting contractual terms,determining
the rights and duties of involved parties,addressing breaches,and providing remedies in case of
non-compliance.Contract law's flexibility allows for adaptation to changing societal norms and
commercial practices while maintaining a balance between upholding agreements and protecting
parties from unfairness or coercion.

By providing certainty, stability, and predictability in commercial and personal interactions, the
law of contract fosters trust, facilitates economic transactions, and ensures accountability within
our legal systems. Its multifaceted nature and nuanced principles render it a vital component of
everyday life, shaping relationships and transactions across various sectors and jurisdictions.

History of Law Of Contract:

Historical Background of the law of Contract Law of contract has been in force in this country
since ancient days. But it was not in the form of statute like the present age. Life style of man, at
that time, was very obligations there was no need of minute analysis of the contract law. Time,
place and circumstances of making a contract were clearly expressed, old, sick, women, monks,
crippled persons and convict people could not make contract.

Manu would put emphasis on repayment of debt. Repayment of debt was not only a moral duty it
was a legal duty too. So, failure to make repayment would invoke punishment. These are all
subject matter of contract.

In the ancient and medieval period, Indian society was developed. The Hindu and the
Mahomedan law provided rules for agreements affecting personal relations and business,
commercial transactions, and transfer of property.

During Muslim period, Muslim law was introduced. Muslim law had a great impact on the law
of contract. Arabic word of contract is 'Akud' which means 'union' or 'binding'. So, by contract a
legal binding was created. Offer, acceptance, majority of the parties, sound mindness and free
consent were considered essential elements for contract. Intention and consent were considered
different concepts in Muslim law. If anybody would do an act under compulsion then it was
considered that he had an intention to do that act but, had no consent to do it. Formality of
contract was not given importance at all.

During the British rule, situations were changing. Hindu law was applied if the parties to the
contract were Hindu and Muslim law if the parties were Muslims. If the plaintiff and the
defendant were of different religion, personal law of the defendant was applied. Gradually, it was
felt necessary that, there should be common law acceptable to all religious people. During the
end of nineteenth century initiative was taken to reduce the law of contract into statutory form.
Existing law in our country was enacted in 1872. This law was framed on the basis of
fundamental principles of British law of contract. In 1947, the British India was divided and
independent and sovereign states, India and Pakistan were created. Both countries after
independence retained this law of contract. In 1971, through an unprecedented mass revolution
the then East Pakistan was separated and an independent republic Bangladesh was established.
Bangladesh also continued to follow that law. So, the contract Act of 1872 is still in force in
India, Pakistan and Bangladesh.

Number of Sections:
The law of contract in Bangladesh is primarily governed by The Contract Act, 1872. This Act
consists of 238 sections that comprehensively cover various aspects of contracts, including their
formation, enforceability, performance, and remedies for breach.

Essential Elements of a Contract (Sections 1-75)

1. Definition and essentials of a valid contract (Sections 1-10)
2. Offer and acceptance (Sections 11-22)
3. Consideration (Sections 23-25)
4. Capacity of parties (Sections 10, 26-30)
5. Free consent (Sections 14-19, 32)
6. Legality of object and consideration (Sections 23, 24, 56)
7. Certainty and possibility of performance (Sections 29, 30)

Types of Contracts (Sections 76-238)

1. Contracts classified based on the mode of creation (Sections 76-123)
2. Contracts based on performance (Sections 124-238)
● Contracts by performance (Sections 124-147)
● Contracts by guarantee (Sections 148-181)
● Contracts by indemnity (Sections 182-238)

Contingent and Voidable Contracts (Sections 31-65)

1. Contingent contracts (Sections 31-36)
2. Void agreements and voidable contracts (Sections 2(g), 10, 12, 14, 19, 19A, 20, 23, 27, 31,
56, 64)

Discharge and Breach of Contract (Sections 73-75, 73A-75B)

1. Modes of discharge (Sections 73-75)
2. Consequences of breach (Sections 73A-75B)
Relationships with practical life/Usefulness:
The Bangladeshi law of contract, rooted in the Contract Act of 1872, holds immense practical
significance in various aspects of everyday life. Here's an outline for an assignment exploring its
practical usefulness:

1. Business Transactions
- It illustrates how the contract law governs business agreements, sales, partnerships, and
commercial dealings.
- It explains the significance of clear terms, conditions, and enforcement mechanisms in
commercial contracts.
2. Employment Contracts
- It can discuss how employment contracts, terms of service, and non-disclosure agreements
are governed by contract law.
- Highlighted the importance of understanding contractual obligations for employees and
employers.
3. Consumer Protection
- Explores how contract law protects consumers in purchase agreements, warranties, and
service contracts.
- Discusses the role of contracts in safeguarding consumer rights and ensuring fair transactions.
4.Property and Real Estate
- It explains the role of contracts in property sales, leases, rental agreements, and mortgage
contracts.
- Also addresses the importance of legal clarity and protection of rights in property-related
contracts.

The good side and bad side of this law:

The Good Side of the Law of Contract:

1.Enforcement of Agreements:
Contracts provide a legal framework for parties to formalize agreements, ensuring promises
made are legally binding.
2.Certainty and Predictability:
The law of contract offers predictability and stability by defining rights and obligations, reducing
ambiguity and misunderstandings.
3.Protection of Parties:
It defence the interests of parties involved by providing legal remedies in case of breach,
ensuring compensation or performance.
4.Encouragement of Commerce:
Contracts simplify economic activities, encouraging businesses to operate and trade confidently
with clear terms and legal protection.
5.Supports Relationships:
Contracts can help in establishing and maintaining relationships between individuals and entities
by providing a structure for cooperation and collaboration.

The Bad Side of the Law of Contract:

1.Inequality of Bargaining Power:

There might be instances where one party, typically the stronger or more knowledgeable one, can
take advantage the weaker party during contract negotiations.
2.Complexity and Legalese:
Legal contracts can be complicated and filled with complex language, making it challenging for
individuals without legal expertise to fully understand the terms.
3.Potential for Unfair Terms:
Some contracts may contain unfair or one-sided statement that favor one party excessively,
leading to injustice or exploitation.
4.Costly Legal Disputes:
Disputes arising from contract breaches can result in lengthy and expensive legal proceedings,
impacting both time and resources of the involved parties.
5. Inflexibility:
Once a contract is signed, parties might be bound by its terms even if unexpected circumstances
arise, limiting their ability to adapt to changing situations.

Conclusion:
The Bangladeshi Law of Contract, dating back to 1872, provides a comprehensive legal
framework for contractual agreements in Bangladesh. It encompasses various essential elements
such as offer, acceptance, consideration, capacity of parties, legality of object and consideration,
void agreements, contingent contracts, and more. The law aims to govern and ensure the
formation, validity, and enforceability of contracts, facilitating fair dealings and protecting the
rights and obligations of parties involved in contractual agreements within the country.