1

The Indian Contract Act, 1872

(Meaning, Essentials and Kinds of Contracts)

Important Words: Agreements, Offer, Consideration, Valid Contract, Void Contract,

Voidable Contract, Free Consent, Capacity to Contract, Promise, Quasi Contracts, Express
and Implied Contracts, Consensus ad idem, Proposal, Acceptance.

INTRODuCTION
The Indian ContractAct, 1872 defines the way we enter into legally enforceable contracts, execute
a contract, and take remedies in case of breach of contract.
Contracts are indispensable part of our life. When we purchase milk or bread in the morning
or goto movie in the evening, we are entering into acontract. Basically, aperson is free to contract
on anyterms hechooses. The Contract Actconsists of only limiting factors subjectto which a
Contract may be entered into, executed and breach remedied. It provides a framework of rules
and regulations which govern formation and performance of acontract. The rights and duties of
parties and terms of agreement are decided by the contracting parties themselves. The court of
law acts to enforce agreement, in case of non-performance and disputes.
Contracts need not be in writing, unless there is a specific provision in any law that the
contract should be in writing. Contract for sale of immovable property must be in writing,
stamped and registered. Contracts which need registration should be in writing. Bills of Exchange
orPromissory Note must be in writing. Trust should be created in writing. Promise to pay a time
barred loan should be in writing, as per Limitation Act. Contracts made without consideration,
on account of natural love andaffection should be in writing. Otherwise a verbal contract is
equally enforceable, if it can be proved.
The Indian Contract Act, 1872 came into effect from 01"September, 1872. It extends to the
whole of Indiafrom 09h August, 2019 with reorganization of State ofJammu &Kashmir into two
union territories. Earlier it was not applicable to the State of Jammu&Kashmir.
4 || Business Laws

The Contract Act is the main source of law regulating contracts in Indian law,
subsequently amended. However, it is not a complete and exhaustive law on all types
Contracts. Sections 1 to 75 of the Contract Act are applicable in general to all contracts where: a co
further provisions deal with special contracts namely Contracts of Indermnity and Guarante
Goods a, lega
Bailment and Pledge, Contracts of Agency. Contracts of Partnership and Sale of whi
regulated by different Acts.
custom of trade or any incident,
Sectionl of the Contract Act provides that any usage or the provisions of the Act. In othe
inconsistent with
Contract is not affected as long as it is not
usage or custom of trade.
words, provisions of the Contract Act will prevail over any

Definition of Contract (Section 2)

enforceable by law is a contract.
Contract : According to Section 2()-an agreement
offive definitions under section 2, of agreemen
This definition of contract is composite ofa series
consideration.
proposal, promise, promisor, promisee, and
promise and every set of promises, forming the consideration for eac
I. Agreement : Every
other, is an agreement. (section 2(e)]
person signifies to another his willingness to do or to abstain fro
Z. Proposal :When one
assent of that other to such act or abstinenc
doing anything, with a view to obtaining the
he is said to make a proposal. [section 2(@))
Promise :When the person to whom the proposal is made signifies his assent thereto, th
3. accepted, becomes a promise. [sectig
proposal is said to be accepted. Aproposal, when
2(b)]
the proposal is called the 'promisor' and th
4. Promisor &Promisee : The person making'promisee. (section 2(c))
person accepting the proposal is called the
promisee or any other perso
5. Consideration:When, at the desire of the promisor, the promises to do ort
has done or abstained from doing, or does or abstains from doing or consideratig
abstain from doing something, such act or abstinence or promise is called a
for the promise. (section 2(d)]
An agreement means consensus on or about something between two parties.
Every promis
and every set of promises forming the consideration for each other, is an agreemnent. Agreemeni
it a
may be with or without consideration. Consideration is, however, essential to make
enforceable contract.
Every contract involves two parties, a promisorand a promisee. Aperson cannot contract wit
himself. In commercial terms, one cannot owe to oneself and have obligations towards oneseli
The promisor or the promisee is aperson. Person includes persons, group of persons, firm
companies, limited liability partnerships or any other association of persons. It also includ:
governments. (State of Uttar Pradeshv. Kanhaiya Lal Mukund Lal Sarraf (1956)).
Acontract is created through a proposal and its unqualified or unconditional acceplanc
Upon acceptance, proposal becomes apromise. If there is no promise, there is no contract. B
the promise willbeeffective andaright, aduty or aliability from the promise will arise only whe
the contract has been created.
 The Indian Contract Act, 1872 || 5

conclude
Proposal shall be definite, complete andcertain that mere acceptance of which can into the
to enter
acontract. Proposal and offer are one word. Proposal is signifying willingness acceptance
legally binding contractual relationship. Signify means communication of offer or
conduct.
which may be bywords, oral or written; or by
ExD, 1. There can be no contract between P as one party and, P and Q as another party.
[Meenakshi Achiv. PSM Subramanian Chettiar, (1957) Mad.)
promisee and
Exp. 2. A agrees to sell his house to B for 720 lakh. Ais promisor, B is
consideration is T20 lakh. The second set of promisor is B, and promisee A with
consideration is sale of house. This is a contract or legally enforceable agreement
between A and B.

Exp.3. Aboards a Delhi Transport Corporation bus and enters into a contract. He shall be
under obligation to pay fare in lieu of journey.
tender. However,
Exp. 4. Adeposited earnest money along with his application for grantof a
tender was not granted to him by the company. The company is under an obligation
as no agreement or contract has been concluded between
to return the deposit to A
them.

Whole
The Law of Contract is not the Whole Law of Agreements, nor is it the
Law of Obligations
creating and
According to legal scholar Sir John William Salmond, a contract is "an agreement whole law of
contract is not the
defining the obligations between two or more parties. The law of agreements which create
agreements,nor is it the whole law of obligations. It is the law of those
obligations and those obligations which have their source in agreements.
may be with or without consideration.
An agreement is a wider term than contract. Agreements
informal relationships without an
Agreements may be just for creating domestic, social and
intention to enter into legally binding relationships.
accepts the invitation. This is a
Exp. 1. A invites B for Diwali celebrations at her home. B
legally bind each other.
social agreement. Both A and B have no intention to
month for domestic expenses of
Exp.2. A, the husband agreed to pay B, the wife 20,000 per pay or pays less, the
the family. This is a domestic agreement. If husband refuses to
agreement cannot be enforced through a court.
legal obligations. The parties to contract
Anagreement to become a contract must give rise to legally binding relationships.
create
must exchange consideration and must have intention to contracts.
not
Thusall contracts are agreements, butall agreementsare
agreements between the parties
However, there are some obligations which do not arise from
contracts, such as:
or voluntarily made contracts but are legally enforceable as
1. Torts or civil wIongs.
2. Quasi contracts.
3. Judgments of courts.
6) Bsiness Laws
[SECTION 10]
ESSENTIAL ELEMENTS OF A VALID CONTRACTare made by free consen.
Accoring to Section 10, "Alagreements are contracts if they lawful object and a 4
competent to ontract, for a lawful considerationand with a
arties,
hereby expresslydeclared tobe void",
are:
The ten essential elements of avalid contract something. To constitute a
consensus about Contract the
1. Agreement. Agreenment is must be two partiesto an agreement, Le. one party mak
must be an agreement. There party accepting the proposal
(promi
a proposal (promisor or offero) and the other acceptance must
offer/proposal must be definite and
or otleree). The terms of theThe acceptance must be according to the mode prescrik
absolute anduncondiional, offeror/promisor.
and mustbe communicated to the company. Al the proposals made wanted
by A w.
an agreement with a party,
bxp. Aentered into was not signed. The other
accepted though aformal contract
change certain terms. Can they do so? proposals ma
change the terms of the contract as the
Ans. No, the other party cannot
such, the contract is concluded even though the for
by Ahad beenaccepted. As Any unilateralchange in the agreement
without
agreement has not been signed.
breach of contract.
prior consent, will amount to consens
constitute a valid contract, there must be meeting of minds i.e. the san
2. Fullconsent. To agree to the same thing in the same
sense and at
ad-idem. The parties should
tìme. They shall have full consent.
in on telephone to sup
B'sshop. Later, he ordered Athe
Exp. 1. A inspected 10 bags of rice 10 bags to
rice' and delivered all
three bags of rice. B heard itas the
consenses-ad-idem, and hence no contract.
Ans. There is no agreement, there mu
3. Intent to create legal
relationship. When two parties enter into an
bind the other as a result of such agreeme
be an intention by both parties to legallynature are not contracts.
Thus, agreements of social or household class X
if he stands first in his school in
Exp. 1. Apromises to gift a car to his sonhard and stands first in the school. If fath
examinations. The son works very
are not made with t
agreements
fails to gift the car, son cannot sue, as domestic
intention to bind the parties legally.
working in Ceylon (now Sri Lank
Exp. 2. Balfour v. Balfour (1919): A, the husband washolidays.
He and his wife went to England to enjoy When A was to return
pay his wife a month
Ceylon, his sick wife had to remain in England. Aagreed to few
maintenance allowance of 30. He sent the amount for months. Later,
could not fulfill his promise and the wife sued him. The court observed that ti
case was not maintainable as the agreement was domestic and not contractuali
nature. The parties had no intention to create a legally binding contract.
Exp.3. McGregor v. McGregor (1888): A wife with draws a complaint against her husbar
under an agreement that husband will pay her alowance. Court held it as
binding contract.
 The Indian Contract Act, 1872 || 7

4. Capacity of parties (competence).The parties to an agreement must be capable of

entering into a valid contract. ACCording to section 11, every person is competent to
contractif he or she
1. is of the age of majority,
2. is of sound mind, and
3. is not disqualified from contracting by any law to which he is subject.
5. Lawful consideration. An agreement to form a valid contract should be supported by
consideration. Consideration means "something in return" (quid pro quo). It can be cash,
However,
in kind, an act or an abstinence. It can be past, present or future consideration.
consideration should be real and lawful. It should not be something which the promisee
consideration, if
would have done anyway. Consideration need not be adequate. Nominal
agreed, isa good consideration.
genuine consent of the
6. Free consent. To constitute avalid contract there must be free and
coercion,
parties to the contract. It should not be obtained by misrepresentation, fraud,
undue influence or mistake. Consent has to be both full and free.
7. Lawful object. The object of the agreement must not be illegal or unlawful. According to
section 23, the consideration or object of an agreement is lawful, unless
" it is forbidden by law; or
provisions of any law or is
" is of such nature that, if permitted it would defeat the
fraudulent; or
involves or implies, injury to the person orproperty of another, or
the Court regards it as immoral, or opposed to public policy.
illegal. Agreements which have been expressly declared
8. Agreement not declared void or
law; hence do not constitute valid contracts.
void or ill egal by law are not enforceable at
The terms of agreement must be certain
9. Certainty and possibility of performance. ascertain the meaning of the agreement, it is not
and not vague. If it is not possible to impossible acts also not enforceable.
enforceable at law. Also, agreementsto do
formalities. A contract may be oral or in writing. If, however, the law requires some
10. Legal legal
procedures for a particular contract, these contracts shall comply with all the
legal attestation. For example; the following contracts
formalities as to writing, registration andregistered :
must be in writing, duly witnessed and (1)).
Contracts made withoutconsideration out of natural love and affection (section 25
(a)
immovable property.
(b) Contractsrelating totransfer of
(c) Transfer of motor vehicles. under the
Memorandum, Articles of Association, creation of charge and mortgages
(d)
Companies Act, 2013.
(e) Creation of trust.
() Promise to paya time-barred debt.
Note (need not be registered).
(g) BillofExchange and Promissory
 Laws CONTRACTS
8| | Business CLASSIFICATION OF
CONTRACTS :
TYPES OF
Contracts
(Basis)

Performance
1. Executed contracts
Formation
1. Express contracts 2. Executory contracts
Validity
1, Valid contracts 2. Implied contracts 3. Unilateral contracts
2. Voidable contracts 3. Quasi contracts 4. Bilateral contracts
3. Void contracts
4. Void agreements
5. Unenforceable contracts
6. Illegal agreements
called
essential elements of acontract is
contract: An agreement which has all the laW.
by
Valid
contract. A valid contract can be enforced
valid there is a valid
contract?
following statements,
In which ofthe life. (Yes)
promises to pay 1000 to Bfor saving his India. (No)
(a) A
Bif Pakistan loses the cricket match with
1000 to
(b) Apromises to pay goods for a week. (No)
hides his smuggled
(c) A promises to pay 1000 to Bifhe
for the professional services rendered. (Yes)
(d) Anagreement to pay the opti
contract (Section 2()]: An agreement which is enforceable by law at voidah
" Voidable
parties thereto, but not at the option of other or others, is a
of oneor more of the consent is missing in acontract, the law confe
contract. If the essential element of free
the contract or to accept it. The contra
right on the aggrieved party either to reject or rejected by the aggriev
continues tobe good and enforceable unless it is repudiated the option of the party who
party, Under the Contract Act, a contract is voidable at influence. Contrac
consent was caused by coercion, fraud, misrepresentation or undue essent
also become voidable when not performed within time fixed where time being of
Refusal ofaparty to perform the contract wholly or where impossibility is created by a
of a party, willalso make the contract voidable at the option of the other party.
Exp. Athreatens to kill Bif hedoes not give him aloan of 750,000 for 25 years. Bgives t
loan. This is a voidable contract as consent of Bis obtained by coercion.
" Void contract (Section 2()]:A void contract is a contract which ceases to be enforceab
by law. This contract when originally entered into, is valid and binding on the parties
may subsequently become void. These contracts are valid at their inception but becon
void by some later event. Contingent contract becomes void when the event on which
enforcement is contingent becomes impossible or does not happen. Contracts becon
void because of supervening impossibility of
a void contract when the party at whose optionperformance.
Avoidable contract becom
it is voidable, rescinds it. Sec. 65 proviu
right of restoration of benefits or
restitution case of these contracts.
in
 The Indian Contract Act, 1872 || 9

ExD. Contracts entered with a foreign national may be valid in the beginning, but may
become void if war breaks outwith his country.
. Void agreement : An agreement not enforceable by law is said to be void. This agreermnent
does not confer any right to any of the parties to it. The agreement is void ab- initio (from
the very beginning). This agreement does not conclude in a contract. These agreements
do not pass from the stage of agreement to being a contract. For example, agreements
with minors, persons of unsound mindetc. are void agreements-void ab- initio.
. Unenforceable contracts : Where a contract is good in substance but because of some
technical defect cannot be enforced by law is called unenforceable contract. These
contracts are neither void nor voidable. For example, if a contract in writing, is unsigned,
undated, unregistered or not duly witnessed, it shallnot be enforceable. Similarly, if the
stamp duty paid is of lesser amount or because the debt has become time-barred under
the law of Limitation, the contract which otherwise is valid in all respects, becomes
unenforceable.
Illegal agreement :Illegal agreements are those where consideration/object are illegal
or unlawful. An agreement is illegal if it is forbidden by law; or is of such nature that, if
permitted,would defeat the provisions of any law or is fraudulent; or involves or implies
injury to apersonorproperty of another; or court regards it as immoral or opposed to public
policy. These agreements are punishable by law. These are void ab-initio. Agreements to
smuggle goods, share black money,evade tax are illegal agreements.
All illegal agreenents are void agreements but all void agreements are not illegal."
Express contract: Where the terms of the contract are expressly agreed upon inwords
(written or spoken) at the time of formation, the contract is said to be express contract.
Exp. 1. John writes a letter to Mike to purchase 100 quintals of wheat at a certain price.
Mike accepts the offer by writing a letter to John or verbally accepts. This contract
is an express contract.
conduct
Implied contract :An implied contract is one which is inferred from the acts or
of the parties or form the circumstances of thecases. Where a proposal or acceptance is
made otherwise than in words, promise is said to be implied.
or orders food in a
Exp. 1. When a person boards a govt. or public transport vehicle
restaurant, there is implied contract to pay bus fare or food charges even though
doso.
no express promise has been made to
out in P's farm and he
Exp.2. Upton Rural District Council u. Powell (1942) : A fire broke believed that his area
called Fire Brigade service. Later he refused to pay them. P
he for the services of
called
was under free service zone which was not true. Once
charges. This is
fire brigade, he is under an implied obligation to pay their rightful
an example of an implied contract.
Quasi contract is strictly not a
Quasi contracts :A quasi contract is created by law. contract. It is a legal obligation
contract as there is no intention of parties to enter into a contract is based on the
it. Aquasi
which is imposed ona party who is required to performhimself
to enrich at the expense of another.
principle that a person shall not be allowed
relations resembling those created by contract.
Quasicontracts are also known as certain is of the nature of quasi
Relationship between the finder of lost goods and its real owner
10 || BusinessLaws incompetent to contract, also
contract. Supply of
necessaries to persons who are
form
conditionin life. Ais
suitableto his
quasi contract.
1. Asupplies
necessaries
B, alunatic withproperty.
entil 2.
Exp. from B's Cand B, not k
to be reimbursed theamount to
Exp. 2. A and Bjointly owed 1000to
000 to C.
C.A
Cis
alone
bound
paid
to repay the amount to
B.
have
knowi
aboutit, again paid 1 which both the parties
" Executed
contract is one in
contract:An executed performed and discharged contract. perform
respective obligations. It is a on stipulated date and ti
their
goods to Yat a stipulated price, This contract is
supply
Exp. 1. Xagreesto the goods and Yhas made the payment. said to
has delivered
one or both the parties to
executed.
contract is one where
Executory contract :An executory obligations in future. Thus, a contract which is na
their
contract are still toperform termedas executory contract.
performed or wholly unperformedis Delivery and payment are to
computer to B for 10,000.
Exp. 1. A agrees to sell his The contract is executory. If one party has performed
made after seven days. still to perform,then contract is executd
but second party is
part of obligation, another party.
one party and executory for advertisem
Alost his bagwith money and important documents. He offers by an
safely to him
Exp. 2. anyone who finds and returns his bag
areward of 75000 to to B. A is bound t0 pay the rewa
knows the award, finds the bag and return it outstanding on the other side
Contract has been performed on one side, and
outstanding part makes it an executory contract.
one party has to perform
Unilateral contract :A unilateral contract is one in which onlyparty has already perfom
obligation at the time of formation of the contract. The other not have any obligation
his obligation before or at the time of the contract, or did
unilateral contract.
perform. Any promise topay for past voluntary services is a
gives it to A. A is
Exp. 1. A lost his purse containing 72000. B finds the purse andcontract.
happy and promises to pay 200 to B.This is a unilateral
" Bilateral contract:A bilateral contract is one in which both the parties to the contracta
under obligation at the time of the formation of the contract. Bilateral contracts are l
known as contracts with executory or future consideration.
Exp. 1. Amanufacturer agrees to supply goods to a retailer after one month and retal
promises to make payment after a week of delivery of goods and inspecton
quality. The contract is bilateral as both the parties are under obligation at t
time of formation of the contract.

Void Agreements v. Void Contracts

Void Agreements Void Contracts
1. An agreement not enforceable by law is said to 1. A contract which ceases to be enforceable.
be void (Sec. 2(g)). law becomes void contract [(Sec. 2))
 The Indian Contract Act, 1872 || 11

Void Agreements Votd Contracts

3 Examples of void agreements are agreements 2. Examples of void contracts are
with minors or persons of unsound mind (0 a contingent contract becoming void
agreements the consideration ot object when contingent event does not happen
of which is unlawful: wager agreements: orbecomes impossible.
agreements to do impossible acts agreements
() a voidable contract becomes void contract
in restraint of legal proceedings etc.
when party at whose option it was
voidable., rejects it.
3 Void agreements are void because they do not 3. These contracts have all the essential features
have essential features of a valid contract. at formation but become void subsequenthy
4 Void agreements are void ab-initio (from the 4. Void contracts are valid contracts at the time of
beginning). These agreements are void since formation. They become void on happening of
inception and never translate into contracts some event subsequent to their formation.
5. Void agreements are not enforceable in the 5. After becoming void, they are not enforceable
Court oflaw at law.
6. Void agreements do not confer any rights 6. Section 65 provides right of restoration of
and duties on the parties to the agreement. benefits or restitution to the affected party Le.,
However, right of restoration of benefits or goods or money paid can be claimed back.
restitution, under section 65, can be daimed in
two cases:

(a) when a minor misrepresents his age

(b) when agreement is discovered to be
void subsequentiy such as on account of
bilateral mistake of fact.
7. Aperson acquiring goods under voidagreement 7. A person acquiring goods under a voidable
has no right over them and can make no further contract can sell or pledge the goods before the
transaction on them like a sale or a pledge. contract has been rescinded by the aggrieved
partv or before it becomes a void contract.

Void Agreements v. Voidable Contracts

Void Agreements Voidable Contracts
1. According to section 2(g, an agreement not 1. According to section 2(0, an agreement which is
enforceable by law is said to be void. enforceable by law at the option of one or more
of the parties thereto, but not at the option of
the other or others, isa voidable contract.
2. Examples of void agreements are, agreements 2. Examples are contracts in which consent of
made without consideration, agreements the other party is caused by coercion, undue
by way of wager, agreements with minors, influence, fraud, misrepresentation or mistake.
uncertain agreements, etc. Contracts also become voidable when not
performed wholly or where impossibility to
perform is created by the acts of the parties.
3. Agreements are void when any of the essential 3. Voidable contracts have all the essential
elements of a valid contract is not there. For elements of a valid contract-including
example, if the parties do not consent or there consent. But consent is not free, it is forced.
1S no consensus-ad- idem, the agreement is Contract is thus, voidable at the option of the
void. party whose consent was forced.
 12 || Business
Laws
Void Agreements Voidable Contracts
4. A
void agreement is void-ab-initio. 4. Avoidable contract is valid till it is
or repudiated by the
aggrieved
aggrieved party does not reject, party.
or rejecte
reject within areasonable
remains valid.
time, the does
contracn
5. Void agreements do not confer any rights and 5. Parties will have all rights and duties
dutieson the parties to the agreement. the contract tillit is repudiated by , related
party. the aggr ieve
6. Right of restoration of benefit is not
available
under section 65 except when a minor lies 6. Right of restoration of benefits is
about his age or when there is a bilateral
mistake of fact.
under section 65.
availab
7. A person acquiring goods under a void 7. A person acquiring goods under
agreement has no right over them. contract has a good title, providedvoidab
have been sold or pledged, good
rescinded. before contract
Void Agreements v. IIlegal
Void Agreements
Agreements
1. Agreements not Illegal Agreements
enforceable by law are said to
be void agreements. 1. Every agreement of
which the
is unlawful is void. object
2. All void consideration
agreements may not necessarily be 2.. Illegal (section 23
illegal. Void agreement is a wider term than agreements a narrower term than th
is
the illegal agreement. void agreement. AIl illegal
illegal agreements are However, both void and but all void agreements are voi
void and unenforceable.void-ab-initio, absolutely llegal. agreements are not necessari
3. Void
agreements not enforceable by law. 3.
are
Those void agreements which arenot illegal and Illegal agreements are
unlawful are, however, not subject to Indian
prohibited under la
Parties to illegal agreements
Penal Code and not are subject to fin
prosecution and punishment.
4. A
punishable.
transaction
may not be void.collateral to a void agreement 4. A
For example, a loan
perform an uncertain act, given to transaction collateral to an illegal agreemer
is also
can be recovered. unlawful irrespective of the fact that t
collateral transaction was
5. Examples: lawful. otherwise legal
(i) Wager 5. Examples:
agreements are void but not illegal
agreements. (i)
(i)
Agreements Agreements which are forbidden by la
illegal
with minor are void but
or punishable. not fraudulent,of injurious to the person
(ii) property another, immoral or oppose
Agreements
but
to do
not unlawful. impossible acts are void
to publicpolicy, are
() Tradingwith enemy,illegal agreements.
course of justice, giving interference with r
bribes,
to marry again whensmugglim
agreement
alive,are all illegal spouse
agreements.
 TheIndianContract Act, 1872 || 13

POINTS TOREMEMBER
1 Law of contract is not the whole law of agreements nor the whole law of obliyations.
2. There must be two parties to an agreement to create legally enforceable contracts,.
3. Only those parties which are competent to contract and have legal intention to do so,
can formcontracts.
4. The object andconsideration of the agreement must belawful.
5. Free and genuine consent is the core of valid contracts,

PRACTICAL PROBLEMS

to buy another, if the first one proves lucky Is the

1. Apurchased a horse fromn Yand promised
valid ?
promise to buy the second horse is
Ans. No, being uncertain.
issueda circular to its debtors intímating its decision to enhance the rate of interest
2. Abank
from the date of notice.Is it a proposal?
communication of rules by the bank for future transactíons.
Ans. No,it is a
farm and he immediately informed Fire Brigade Service who put out
3. Afire broke out in B's the bill on B, he refused to pay as he believed it was a free
the fire. When Fire Service raised
service. Is Bliable to pay?
similar to Upton Rural District Council v.Powell (1942).
Ans. Yes. The case is separated on an express promise from
always in disputeand He
4. A husband andwife were monthly allowance to wife till they were legally separated.
husband that he would paya then stopped. Has wife any legal right agaínst husband ?
and
gave money for few months Balfour v. Balfour.
Compare their position with held to be binding on husband because
Balfour v. Balfour was not husband and wife had
Ans. The agreement in bind it legally. But in the above case, the
them is legally
they had no intention to separation, and therefore agreement between
clear intention to seek legal
enforceable.

TEST QUESTIONS
contracts. Discuss the statement
are not
agreements but all agreements
are
I. All contracts
with examples. examples.
essentials of avalid contract with
Define all law. Explain.
2. Define contract. will be enforceable by
contract can be verbal or in writing, it
3. A
 Business Laws
14 | |
Consideration.
on:
4. Write shortnotes Contracts; 3.
Quasi
Proposal; 2.
1.
5. Differentiate : contracts.
and implied
contracts.
(a) Express and bilateral
Unilateral
(b) contracts.
voidable
(C) Void and
6. (a)Write notes on:
C Unenforceable contracts.

B (b) Void agreements.

(c) Executory contracts.
At