Introduction to Contract

NLSIU
Classical contract theory: 3 threads
• Contract is a bargain

• Will of parties [consensus ad idem-

agreement]

• Freedom of Contract is paramount

 Development of Contract Law:
Principles
• Law of obligations [vinculum juris]

Moral obligations contractual obligations

• Law of unjust enrichment

• Law of restitution [Injurious reliance]

 Courts in England
Writ of performance

Writ of debt Writ of covenant writ of deceit

Quid pro quo

Pacta sunt servanda

 Freedom of contract ?

• ‘Contract as an instrument of free

bargaining between parties on the basis of
equality’
 Freedom: Need ?
• To determine the primary obligations of
parties

• To understand the inequality of bargaining

power

• To understand public utilities

 Means of contract
• Formal and Informal contracts
• Bilateral and Unilateral contracts
 Contractual terms: Formation
Performance

• Contract may be oral or written.

• Representation

Express Implied Intermediate terms

• Terms/ Expressed in writing

Conditions/warranties Implied by Statute terms by customary usage Standard form of

contract
 Object of Law of contract
• To avoid litigation

• To establish set of rules for compliance

• To penalize defaulters
 Point of Legality
• Valid Contract
• Void Agreements : sec. 2(g)
• Voidable contracts:
• Illegal contracts
 Law of torts and Contract
• Misfeasance
• Malfeasance
• Nonfeasance
 Would an action stand in Tort when
the Contract is silent
• Blackpool and Fylde Aero Club v Black pool Borough
Council 1990 WLR 1195
• Reid v Rush Tompkin Group 1990: Car accident case.
• Winterbottom v Wright 1842 152 Eng Rep 402
Digital contracts
 Issues
• Conceptual framework
• Rules governing e-contracts
• I T 2000
• Digital signature
• E-auction
 Issues in E-contract
• California Software Inc v Reliability Research
Inc, 1356 [C D Cal, 1986]
• Beta Computers Ltd v Adobe Systems Ltd 1996
FSR 367
• TCS v State of A. P
• European Commission and ‘Product liability’
• Shrink wrap
• Click-Wrap
– ProCD, Inc. v. Zeidenberg, 86 F.3d 1447 (7th Cir., 1996
 Outsourcing Contract
• Issues
• Sections 13, 15 and 44A of the Indian Civil
Procedure Code and Section 41 of the
Indian Evidence Act, govern the
conclusiveness and enforcement of
foreign judgments in India
• Liability of a software developer
 Problems with E-contract
• Taxing E-commerce
• Copyright or Patent of software ?
• UK Electronic Commerce Act 2002
• Limitation of Digital Contracts
Indian Partnership
 Essentials of Firm
• 1. Association of two or more persons
• 2. In pursuance of an agreement or contract
• Re Fisher and Sons 1912 2 KB 491: difference between Co-
owners and partners
• 3. To combine property, labor or skill
• 4. In a business
– New Mofussil Co v Rustomji 1936
– Coope v Eyre 1788
• 5. Carried on by all or any one of them on behalf of all
– Firm name/Property
– Miles v Clarke 1953 1 ALL ER 779
• 6. With a View to share Profits
• Daulat Ram v Dharm Chand AIR 1934 Lah 110
 Minor Partner
• Sec. 30(1): ‘A person who is a minor according to the law to
which he is subject may not be a partner in a firm, but with the consent
of all partners for the time being, may be admitted to the benefits of
partnership’
– A A Khan v Amer Karium AIR 1952 Mys 131
– Lachmi Narain v Beni Ram, AIR 1931 ALL 327
• Rights of minor: Questions
– Tulsi das v Gangaram AIR 1925 Sund 272
– Satya Narain v Juggal Kishore AIR 1958 All 312]
• Minor’s liabilities sec. 30(3)(5)(7)(9)
– Sanyasi Charan Mandal v Asutosh Ghose 1915 42 Cal
225
– CIT v Vijay Kumar Rajesh
• Liability of a minor after attaining majority
 Types of partnership
• Partnership at will :
– M O H Uduman v Ashurn AIR 1991 SC 1020:
– Karumuthu Thiagarajan Chettiar v Muthappa
Chettiar AIR 1961 SC 1225
• Partnership for a fixed term
• Particular partnership :
• Limited Partnership :
• Partnership by Holding out
– Sleeping partner
– Nominal partner
– Working partners
 Rights of a partner
• 1. Joint ownership of partnership property
• 2. Right to take part in the management [sec. 12]
– Suresh Kumar v Amrit Kumar AIR 1982 Del 131
– Right to Express opinion [sec. 12 c]
Lord Fldon in Const v Harris 1824 said
“for a majority of partners to say, we do not care what one
partner may say, we being the majority will do what we please
is what a court of equity will not allow’.
– Dismissal of a servant
– New business
– Blisset v Daniel 1853
• 3. Access accounts and act during emergency
– Re Martindale ex Truman 1832
 4. Right to profit
– Mansa Ram v Tej Bhan AIR 1958 Punj 5
– Delhi Veopar Mandal v IT Commissioner AIR
1967
– Dawood Sahib v Sheik Mohiuddin Sahib AIR
1938
• 5. No claim for interest of capital
• 6. Right to indemnity sec. 13(e)
– Thomas v Atherton 1877
 Rights of partners
• 6. Right not to be expelled
• 7. No new partner to be introduced: right
to prevent
• 8. No liability before joining unless with
consent and expressly stated in the deed
• 9. Right to retire: 3 ways
 Nature of Liability of partners
• Joint and several: sec. 25: every partner is liable
jointly with all the other partners and also
severally for all acts of the firm done while he is
a partner’
• Test
– Benefit of the partnership
– Within the scope of authority

– Malyn v John Houston 1903 1 KB 81

– Moreton v Harden 1825
– Citizens Life Assurance v Brown 1905
– R W Pathirana v Pathirana 1967 1 AC 233
 Nature of Implied Authority
• 1. Authority to purchase and sell
– Bond v Gibson [1808]
• 2. power to recover money due to firm/
borrow money on credit:
– Higgins v Beauchamp 1914 2 KR 1992:
• 3. Authority to engage lawyers
• 4. Authority to insure firm goods
Conditions for application of Implied
authority
• 1. Act must be done in the capacity of a
partner:
– Gouthwaite v Duckworth [1810 104 ER 174]:
• 2. Act must be done on behalf of the firm
and not on personal behalf
• 3. Act must relate to activities within the
scope of business
• 4. Act must be done in the firms name
Does implied authority vary acc/ to
type of partnership
• LLP, Will the concept of mutual agency
continue ?
 Dissolution

• Of partnership of Firm

End of the term completion of business by death/insolvency by retirement

 Dissolution of Firm
• Without Court
– By Agreement
– Compulsory dissolution
– Dissolution on contingency
– By notice
• By Court
– Persistent misconduct or disregard to partnership
agreement
– Unsoundness of partners
– Business at loss

– Jurisdiction of the Courts to try dissolution

MD Hassen Hashmi v Kaberi Roy AIR 1993 Cal 70
 Winding Up
• Right to continue business
• Good will
• Restraint of trade
 What is a proposal/offer
• ‘I think I like your car and will try to buy it’
• I saw an advertisement for the sale of your
car, will you sell your car to me?
• ‘I am willing to buy your car for a
reasonable price’.
• Are these Offer ?
 Invitation to Treat
• Advertisements: General Offer
• Display of goods for sale
• Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256
• Harvey v Facey [1893] AC 552
– ‘Will you sell us Bumper Hall pen, telegraph at what price’
– ‘lowest price for the pen is 100’
• Powell v Lee [1908] 99 L Y 284
• MC Pherson v Appanna [AIR 1951 SC 184]
– ‘wont accept less than 10,000’.
 Modes of Offer
• Time table
• Tenders and Auctions [Harris v Nickerson]
• Restaurant menu card
• ATM or vending machines
 Offer: Communication
• Gibbons v Proctor 1891 64 LTN S 594 [Reward
for a criminal]
• Lalman Sukla v Gouri Dutt 1913ALJ 4891
[Missing boys case]
• Tim v Hoffman 1873, 29 L T 271: cross offer is
no offer

• Counter Offer
• Proposal must be made to another person
 Termination of Offer
• ‘An offer can be withdrawn at any time
before it is accepted’.
• Distinction between lapse of offer and
revocation
• Notice, Death, incapacity, lapse of time
• Errington v Errington [1952] Father promises to son
and daughter in law that if they pay mortgage amount of the
property, the property would be theirs
 Acceptance
• Acceptance must be in toto: Mirror Image Rule
• Manner/mode of acceptance [sec. 7]

By an act promise
• Is Silence an acceptance ?
– Felthouse v Bindley 1862 11 CB 869.: Uncle tells his nephew
– ‘If I hear no more from you, the horse in mine’.
– The nephew during an auction stated to the auctioneer to reserve the
horse for his uncle
• Silence and thereafter a ‘conduct’ of acceptance ?
– LIC of India v Vasireddy AIR 1984 SC 1014
– 27th Dec. 1960 filing of proposal for LIC
– Proposer died on 12th Jan 1961
• Can Acceptance be revoked ?
 Acceptance: contd
• Is Communication of Acceptance essential?
• Acceptance through post: Mailbox rule
– Adams v Lindsell [1818 1 B& Ald. 681.
- 2/9/1817, defendants offered to sell a quantity of wool at a
certain price and expected the answer by post, the letter
reached the plaintiff on 5th, the same day, he posted the
acceptance, which reached the defendants on 9th.
- The defendants waited till 7th and on 8th sold the same wool
to another person
- Is there an acceptance ?
• Who can communicate the acceptance ?
• When is a unilateral contract accepted ?
When does the mailbox rule apply?

• Q. Is revocation of acceptance
possible ?
• Henthorn v Fraser 1892
– Secretary signed a note giving option to purchase for 14
days at P-750, next day withdraws through post at 12-1.00
pm, claimant posts the acceptance on the same day
between 3-4 pm.

• Which ever communication reaches

first is valid
 Offer and Acceptance: Where the
contract is made?
• It determines the time of forming the
contract
• It stipulates the jurisdiction of the court;
and
• It affixes the rights and obligations of
parties

• Is the contract complete at the instance

and place of the acceptor or offeror?
 Invitation to Treat
• Advertisements: General Offer
• Display of goods for sale
• Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256
• Harvey v Facey [1893] AC 552
– ‘Will you sell us Bumper Hall pen, telegraph at what price’
– ‘lowest price for the pen is 100’
• Powell v Lee [1908] 99 L Y 284
• MC Pherson v Appanna [AIR 1951 SC 184]
– ‘wont accept less than 10,000’.
 Modes of Offer
• Time table
• Tenders and Auctions [Harris v Nickerson]
• Restaurant menu card
• ATM or vending machines
 Termination of Offer
• ‘An offer can be withdrawn at any time
before it is accepted’.
• Distinction between lapse of offer and
revocation
• Notice, Death, incapacity, lapse of time
• Errington v Errington [1952] Father promises to son
and daughter in law that if they pay mortgage amount of the
property, the property would be theirs
 Acceptance
• Acceptance must be in toto: Mirror Image Rule
• Manner/mode of acceptance [sec. 7]

By an act promise
• Is Silence an acceptance ?
– Felthouse v Bindley 1862 11 CB 869.: Uncle tells his nephew
– ‘If I hear no more from you, the horse in mine’.
– The nephew during an auction stated to the auctioneer to reserve the
horse for his uncle
• Silence and thereafter a ‘conduct’ of acceptance ?
– LIC of India v Vasireddy AIR 1984 SC 1014
– 27th Dec. 1960 filing of proposal for LIC
– Proposer died on 12th Jan 1961
• Can Acceptance be revoked ?
 Acceptance: contd
• Is Communication of Acceptance essential?
• Acceptance through post: Mailbox rule
– Adams v Lindsell [1818 1 B& Ald. 681.
- 2/9/1817, defendants offered to sell a quantity of wool at a
certain price and expected the answer by post, the letter
reached the plaintiff on 5th, the same day, he posted the
acceptance, which reached the defendants on 9th.
- The defendants waited till 7th and on 8th sold the same wool
to another person
- Is there an acceptance ?
• Who can communicate the acceptance ?
• When is a unilateral contract accepted ?
When does the mailbox rule apply?

• Q. Is revocation of acceptance
possible ?
• Henthorn v Fraser 1892
– Secretary signed a note giving option to purchase for 14
days at P-750, next day withdraws through post at 12-1.00
pm, claimant posts the acceptance on the same day
between 3-4 pm.

• Which ever communication reaches

first is valid
 Offer and Acceptance: Where the
contract is made?
• It determines the time of forming the
contract
• It stipulates the jurisdiction of the court;
and
• It affixes the rights and obligations of
parties

• Is the contract complete at the instance

and place of the acceptor or offeror?
 Chapter-3: Capacity to
Contract
• Two kind of ‘persons’
– Natural
– Legal or juristic person
• Natural Person

Latent incapacity patent incapacity

[infancy, unsoundness, lunacy] [B’cos of Status: insolvency,
alien enemy, Married]
 Legal person

• Ultra vires winding up any other

Acts of sovereign, Corporate and companies
 Liability of Minors in Contract

• Sec. 68: ‘if a person, incapable of entering

into a contract is supplied with necessaries in
life, the person who supplies is entitled to be
reimbursed’
• Doyle v White City Stadium 1935 1 KB
110,
 Insanity/lunacy
• Inder Singh v Parmeshardhni Singh
AIR 1957 Pat. 49
• Mathews v Baxter [1873, L R 8 Ex. 132]
 Other Incapacities
• Political Status
– Alien enemy
– Foreign sovereigns and ambassadors
• Mighell v Sultan of Johore [1894, 1 QB 149]
• [Also see sec. 86 of CPC which provides that in case of suit against
a foreign sovereign, the consent of the Central Govt is required]
• Corporation
– Ashbury Railways Carriage Co. V Riche 1875, 7 HL
653. [an agreement for purchase of railways which
was not mentioned in the MOA was held ultra vires]
– Q. Does Ultra vires means void contract ? Are third
parties protected from such ultra vires acts ?
 Other Incapacities
• Married Status
• Professional status: can an advocate sue
in contract, his client for fee ?
 Chapter 4: Consideration
• Sec. 10 requires Lawful consideration as an
essential factor for giving enforceability to an
agreement.
• Sec. 25 an agreement without consideration is
void [nudum pactum]
• Sec. 23 and 24 deal with circumstances in
which the consideration will be treated
unlawful
 What is consideration
• Money [need not be adequate]
• An act, abstinence or promise
• Must be real [White v Bluett]
• Performance of a legal duty is no
consideration
 Why Consideration ?
• Consideration only at the desire of the promisor
– Durga Prasad v Baldeo [Building a market place at the order of the Collector,
Defendants, a tenant made a promise to pay, later refused, was held not
liable to pay]
• Consideration by the promisee or any other person
– Chinnaya v Ramaya [old lady granted an estate to the daughter with a
direction that the daughter should pay an annuity of Rs 653 to the lady’s
brother. On the same day the daughter executed a promise to pay to the
mother’s brother Rs 653. She failed and claimed that the brother had not
given any consideration. Held: consideration by the mother is enough
consideration]
• Consideration may be Past, Present or Future
• Privity of contract
– A person may not give any consideration, but is a party to the contract may
enforce the contract
– A stranger to a contract cannot sue : Suppose A and B enter into a contract
for the benefit of C. The agreement between and A and B cannot be
enforced by C.
– Tweddle v Atksinson : two father entered into an agreement to pay a new
couple money on their marriage. The couple cannot sue for enforcement of
the contract between the fathers.
 Exceptions
• Law of Trust/ Insurance
– Klause Mittelbachert v East India Hotels [pilot, head injuries during a
dive at the swimming pool, contract between Lufthansa and hotel
Oberoi, can the pilot claim damages, though the consideration was not
moving from him ?]
• Conduct, Acknowledgment or Admission
– Narayani Devi v Tagore Commercial Corporation [If the defendants start
the payment and then withdraws]
• Provision for marriage expenses or maintenance under family
arrangement/
– Veeramma v Appayya [daughter agreed to take care of the father for
which the father promised to convey property to her. Later when the
father refused, the daughter sued successfully.
– Sundaraja Aiyangar v Lakshmiammal [partition deed between brothers
to provide for marriage expenses of the sister, is enforceable by the
sister]
• Subscription for a charitable purpose
– Kedar Nath v Gorie Mahomed
Doctrine of Promissory Estoppel
• Central London Property trust Ltd V High
Trees House Ltd 1947 KB 130.
• Rule in Pinnel Case [promise to pay less
than the due amount]
– D&C Builders v Rees 1966 2 QB 617
– M P Sugar Mills v State of U PAIR 1979 SC 621
• Forbearance to sue is good consideration
 When Agreement without
consideration is valid
• Natural love and affection
• Compensation for past voluntary services
• Promise to pay a time barred debt
• Creation of Agency does not require
consideration
 Free Consent
• Coercion: committing or threatening to commit
an act forbidden by IPC
– Ranganayakamma v Alwar Setti [Adoption of son by a
widow]
– Chikkan Ammiraju v Chikkam Seshama [Threat to
commit suicide]
• Economic duress
– B& S Contracts & Designs v Victor Green Publications Ltd
1984 ICR 419 [erecting a stand, contractor claimed labour
strike and increased amount]
Undue Influence: a Specie of fraud
• Taking of unfair advantage [sec. 16]
• Misuse of influence
• Abuse of trust and confidence
• Connotation of impropriety
Classes of undue influence

Actual presumed undue influence

Based on proof
 What constitute undue influence
• Relationship of parties is such that one party is
in a position to dominate the will of the other.

Real and apparent authority fiduciary relationship mental capacity, age,

illness

• The party in the dominating position uses that

position to obtain an unfair advantage
 Presumption of undue influence:
position of domination
• Parent and child
• Guardian and ward
• Trustee and beneficiary
• Solicitor and client
• Doctor and patient
• Spiritual adviser and disciple

• The list does not include husband and wife nor

does it include principal and agent, banker
and customer or teacher and student
 Illustration
• Tate v Williamson 1866 LR 2 Ch. App 55
• Allcard v Skinner 1887 36 Ch.d 145
 Rebutting the presumption of
undue influence
• Whether the victim had independent and qualified
advise ?
– Solicitors must give fair and disinterested advise
– He must ensure that the decision of his client is proper and
to his benefit
• The victim understood the nature and consequences
of the transaction ?
– Disclosure of material facts
• Whether he was able to arrive at independent and
informed decision/judgment.
– Objective and conduct of parties
 Fraud
• False statement of facts
• Mere silence is no fraud
– Duty to speak by law
• P Sarojam v LIC [aliments were not disclosed in
the form]
• Rajinder Singh v Pomilla [premartial status of a
party was a material fact]
– Active concealment
• Shri Krishna v Kurukshetra University
 Misrepresentation

• Fraudulent Negligent Innocent

Rescind claim damages[tort] no claim

 Misrepresentation

Conditions [sec 12 (2) of the Sale of goods Act] Warranties

• A representation is a statement made at the time of the contract by way of

affirmation, denial or description or presentation of a material fact to
contract.
• It is more than the intention of parties and different from opinion
– Smith v Land & House Property Corp (1884) 28 Ch D 7
– The plaintiff put up his hotel for sale stating that it was let to a 'most desirable
tenant'. The defendants agreed to buy the hotel. The tenant was bankrupt. As
a result, the defendants refused to complete the contract and were sued by the
plaintiff for specific performance. The Court of Appeal held that the plaintiff's
statement was not mere opinion, but was one of fact.
 Representation
• Must relate to fact and not law
• Must relate to Fact and promise
• There must be a representation or assertion
• It must be made with the knowledge that it is false or without
belief in its truth
• It must be acted upon
• Damages must be suffered: No fraud no damages [sec. 17 read
with sec. 19 of ICA]

• Ex: Prospectus of a company

• Sec. 55 of the TP Act requires the seller of immovable propery
to disclose to the buyer material defects in the property
 Implied representation
• Spice Girls v Aprilia World Service BV 2002 Ch D
– A entered an contract for endorsing product [scooter] with
Spice Girls [a group of 5]. Within two weeks, ‘Ginger
spice’ left the group, making the product vulnerable in the
market. The Pop group did not disclose this to the Agency.
– Was the group split before endorsement ?
– Was there an intention to split ?
– Was there a misrepresentation that the group was together ?

– Held misrepresentation. [Carbolic smoke ball company]

Void agreements
 Mistake

Of Law Of Fact

Of ordinary law of foreign law of pvt rights

As to nature of contract as to persons contracted with as to subject matter

 Mistake
• 1. Mistake when there is no consensus ad idem [Raffles v
Wichelhuas 1864 ]
• 2. Mistake as to a matter of fact essential to the agreement
– [sec. 20] Ayekam Angahal Singh v UOI Air 1970
• 3. Mistake of Law
– Lakshman Prasad and Sons v Achuthan Nair AIR 1955 Mad 652
• 4. Mistake on subject matter:
– Leaf v International Galleries [1950] 1 All ER 693
• 5. Mistake as to possibility of performance of the contract
– Sheikh Bros v Ochsner 1957 AC 136 ---- Griffith v Brymer
(1903) 19 TLR 434
• 6. Mistake as to identity of parties
– Boulton v Jones 1857--- Said v Butt 1920
 Mistake: New developments
• Contract made inter praesentes
– Phillips v Brooks 1919
– Ingram v Little [1960] 3 All ER 332
– Bell v Lever Bros Ltd. [1932 AC 161]

• Plea of ‘Non est factum’

– Dularia Devi v Janardan Singh AIR 1990 SC
1173
 Legality of object and Consideration
• 1. It is forbidden by law
– Universal Plast Ltd v Santosh Kumar AIR 1985
• 2. Defeat the provision of any law
– Ram Sewak v Ram AIR 1962 All 177 -Abdul Piojkhan Nabab v Hussenbi 1904
• 3. Injurious to person or property
– Gurmukh Singh v Amar Singh 1991 2 SCC 79
• 4. Agreement Injurious to public policy
– Sukha v Ninni AIR 1966 - Punnakotiah v Kallapalli Kolikamba AIR 1967 AP ---
Mewa Ram v Ram Gopal ILR 1926
• 5. Immoral
– Pearce v Brooks 1866-- Bai Viji v Nansa Nagar 1885 ----Narayani v Pyare Mohan
AIR 1927
• 6. Agreement opposed to public policy Sec. 23
– Trading with an enemy
– Trafficking in public offices
– Interference with the administration of justice
– Marriage brokerage contracts: Herman v Charlesworth 1905 2 KB 123
 Void Agreements
• 1. Agreement in restraint of marriage: sec. 26
– Rao Rani v Gulab Rani AIR 1942
• 2. Agreement in restraint of trade [sec. 27]
– Herbert Morris Ltd Saxelby 1916
– Nordenfelt v Maxim Nordenfelt Guns and Ammunition Co 1894
– Gujarat Bottling Co v Coca Cola Company Air 1995 SC 2372
• Exception to an agreement in restraint of trade
– 1. Sale of Good will
– 2. Exception under Indian Partnership Act
– 3. Restraint by a contract of service [employment]
• Niranjan Shankar v Century Spinning and Manufacturing Co AIR 1967
• 4. Trade combinations
– Sheikh Kalu v Ram Sharan Bhagat 1909 13 CNN 388
• 5. Agreement in restraint of legal proceedings: sec. 28
– Ghose v Reliance Insurance Co 1934
• 6. Wagering Contracts
 Quasi Contracts
• 1. Claim for necessaries supplied to a person
incompetent to contract [sec. 68]
• 2. Reimbursement of money paid due by another
– Exall v Patridge 1799
– Bansidhar Joshi v Chandrakumar AIR 1964 All 348
• 3. Obligation of person enjoying benefit of non-gratuitous
act: [sec. 70]
– Indu Mehta v State of UP AIR 1987 ALL 309
• 4. Enjoyment of benefit by the defendant is necessary:
– P C Wadhwa v State of Punjab AIR 1987 PH 117
• 5. Finder of Lost goods: sec. 71
 Discharges/ Remedies under Law
of Contract
• 1. Performance of contract
• 2. Quantum meruit
 Performance of Contract
• Every such offer must fulfill the following conditions:-
• 1) it must be unconditional
– Navin Chandra v Yogendra Nath
• 2) it must be made at a proper time and place
– Start-up v Macdonald 1843
• 3) under such circumstances that the person to whom it
is made may have a reasonable opportunity for
inspection
– Performance on death of a party
– Performance by the promisor or his agent or representatives.
• 4) An offer to one of several joint promisees has the
same legal consequences as an offer to all of them.
Remedies for Breach of
Contract
Dr. Sairam Bhat
Assistant Professor of Law
 The Law
• Indian Contract Act 1872
• Specific Relief Act
• Law of obligation
– Law of Unjust enrichment
– Law of Restitution
 Plea
• Non est factum
– Gallie v Lee
• Specific Performance/substantial performance
– Dakin v Lee
• When ‘time’ is the essence of the contract: Right to
rescind the contract
– R K Saxena v Delhi Development Authority AIR 2002 SC 2340
• Impossibility of Performance
– Taylor v Caldwell (1863) 3 B&S 826
• Doctrine of Frustation
– Arti Sukhdev Kashyap v Daya Kishore Arora AIR 1994
 Discharge of Contract
• Bilateral discharge
– Accord and satisfaction
– RESCISSION AND SUBSTITUTION and
Novation
– VARIATION
– WAIVER
 Breach of contract
• Anticipatory breach
– Hochster v De La Tour
• Liability of loss only due to CAUSATION
[carpenter left the door unlocked]
• Remoteness of damages
• Mitigation of loss
 Breach

• Rectification and cancellation of

Instrument
• Damages
– Nominal
– Penalty
• Injunction
– Temporary
– Permanent
Thank you