ACKNOWNLEDGMENT

At the outset, I take this opportunity to thank my Professor Dr. K. Govind

Rajan from the bottom of my heart who has been of immense help during

moments of anxiety and torpidity while the project was taking its crucial shape.

Secondly, I convey my deepest regards to the Vice Chancellor Arun Roy

and the administrative staff of TNNLS who held the project in high esteem by
providing reliable information in the form of library infrastructure and database
connections in times of need.

Thirdly, the contribution made by my parents and friends by foregoing

their precious time is unforgettable and highly solicited. Their valuable advice
and timely supervision paved the way for the successful completion of this
project.

Finally, I thank the Almighty who gave me the courage and stamina to
confront all hurdles during the making of this project. Words arent sufficient to
acknowledge the tremendous contributions of various people involved in this
project, as I know Words are Poor Comforters. I once again wholeheartedly
and earnestly thank all the people who were involved directly or indirectly
during this project making which helped me to come out with flying colours.
 Research Methodology

The research methodology used in this project is analytical and descriptive.

Data has been collected from various books, materials, papers and web sources.
This project is based upon non-doctrinal method of research. This project has
been done after a thorough research based upon intrinsic and extrinsic aspects of
the project
SYNOPSIS
S.NO CONTENTS

1 WHAT IS A CONTRACT?

DEFINITIONS OF OBLIGATIONS
3
THE LAW OF OBLIGATIONS

(i) Source

(ii) Contracts

(iii) Quasi-contracts

(iv) Quasi-delicts

(v) Subject matter

PHILOSOPHY OF A CONTRACT AND ITS OBLIGATION

5
WHAT IS CONTRACTUAL OBLIGATION?

6
WHAT ARE SOME EXAMPLES OF CONTRACTUAL
OBLIGATIONS?

CAN CONTRACTUAL OBLIGATIONS BE

 TRANSFERRED TO ANOTHER PARTY ?

8
CONTRACTS NATURE OF CONTRACTUAL
OBLIGATIONS

WHAT IS A CONTRACT?

A contract is a legally binding or valid agreement between two parties. The law will consider
a contract to be valid if the agreement contains all of the following elements:

1. offer and acceptance;

2. an intention between the parties to create binding relations;

3. consideration to be paid for the promise made;

4. legal capacity of the parties to act;

5. genuine consent of the parties; and

6. legality of the agreement.

An agreement that lacks one or more of the elements listed above is not a valid contract.

Each of these elements is dealt with in more detail in this section.

DEFINITIONS OF OBLIGATIONS
1. General: Bond of moral duty (whether of necessity or of one's own choosing) that ties two
or more parties together.

2. Accounting: Duty to make future payment that is incurred as soon as a purchase order is
placed, encumbers a certain sum of money, and is called obligation incurred.

3. Legal: Liability or duty to do something or refrain from doing something under

the terms of a contract, such as the obligation of a borrower (the obligor) to pay back
the lender (the obligee) under the terms of the loan agreement. Obligations usually involve
a penalty for non-fulfillment.

THE LAW OF OBLIGATIONS

The law of obligations is one branch of private law under the civil law legal system and so-
called "mixed" legal systems. It is the body of rules that organizes and regulates the rights
and duties arising between individuals. The specific rights and duties are referred to
as obligations, and this area of law deals with their creation, effects, and extinction. An
obligation is a legal bond (vinculum iuris) by which one or more parties (obligants) are bound
to act or refrain from acting. An obligation thus imposes on the obligor a duty to perform, and
simultaneously creates a corresponding right to demand performance by the obligee to whom
performance is to be tendered. Obligations may be civil, which are enforceable by action in a
court of law, or natural, which imply moral duties but are unenforceable unless the obligor
consents.

SOURCE

Obligations arising out of the will of the parties are called voluntary, and those imposed by
operation of law are called involuntary. Sometimes these are called conventional and
obediential. The events giving rise to obligations may be further distinguished into specified
categories.

voluntary:

unilateral promise (pollicitatio) - undertaking by promisor only to perform, not

requiring the agreement of the beneficiary
 contract

quasi-contract

negotiorum gestio - duty to repay someone (gestor) who has managed

the affairs or property of another who was unable

solutio indebiti - undue payment or delivery of a thing to another, who

is then obligated to return the thing

involuntary:

delicts and quasi-delicts (equivalent to the common-law tort).

unjust enrichment (condictio indebiti)

Contracts

A contract can be broadly defined as an agreement that is enforceable at law. Gaius classified
contracts into four categories which are: contracts consensu, verbal contracts, contracts re,
and contracts litteris. But this classification cannot cover all the contracts, such as pacts and
innominate contracts; thus, it is no longer used.

Quasi-contracts

Quasi-contract is one of the four categories of obligation in Justinian's classification. The

main cases are negotiorum gestio (conducting of another person's affairs without their
authorisation), unjust enrichment, and solutio indebiti.

Quasi-delicts

The designation comprised a group of actions of no obvious similarity, classified by Justinian

as analogous to delictual obligations. It includes res suspensae, things poured or thrown,
shippers/innkeepers/stablekeepers, and erring judges.
SUBJECT MATTER -

Obligations are classified according to the nature of the performance (prestation):

real obligations - undertakings to give or deliver property, possession, or enjoyment [4]

specific real obligation - delivery of a determinate thing when it is particularly

designated or physically separated from all others of the same class

generic real obligation - delivery of a generic thing

personal obligations - undertakings either to do or not do all kinds of work or service

positive personal obligation - performance

negative personal obligation - forbearance

PHILOSOPHY OF A CONTRACT AND ITS OBLIGATION!

Men of wisdom stated:

Yesterday (as past ) is gone (dead) (as some archive - a tomb like)

Today is (as real fact) living (as long as you are detined to live today) -Look to;

Tomorrow (is not present today) (some future likely, provided you are alive) , an
Unsure proposition)
In these, circumstances, we live on earth; that means your rule of natural law ought to be
within these parameters only ; and you cannot exceed the parameter obviously;

If you do, you fall in a category of some speculation;

You cannot speculate on unreal future, till the future becomes a present real thing;

But unfortunately, we live on future propositions only, when you actually live only in the
present, when so where is the sanctity of your living on future propositions?

In Mahabharata: (Gita Upadesh):

Pandavs lived in Indraprastha and did build Maya Palace of unreality of future existence;

Duryodana of Kauravs visit the palace, see the palace and presume things as reality while in
fact, something unreal; that unreal things capture their mindset and influence them to be
angry over their cousins - Pandavs;

Results in play of Dice Yudhishtra fond of, despite a Darmic minded person (normally
Darmic minded never indulge in Dice play - a contradiction);

This play results him loosing all his brothers including himself in the bets that followed;
When he lost everything, Kaurav counsel Shakuni suggests, he can bet his Queen- wife
Draupathi ( after Yudhistra lost earlier himself in the bet) - so Draupathi say Yudhistra has
lost his right to bet her as he lost himself earlier in the bet) - all wise men agree there
including Bhishma with a rider , that Yudhishtra being a king (but once he lost himself in
the bet how he could claim to be the king is a question sill raisable) besides Yudhishta being
acclaimed as great Law giver, he could deliver his ruling on his bet of the Queen (factum is
he lost his status of Law giver, just because he cannot be judge on his own cause - like a
prosecutor cannot be judge on his own cause); and h others. He had lost his brothers in the
bet before he lost his own person - so by all means he is a dead person, non-person at all per
contractual jurisprudence, in regard to jurisprudence of obligations under contracts, as
Draupathi rightly knew the constitutional jurisprudence on contracts much better than very
Yudhistra that shows even in the early periods of prehistoric India women were indeed more
prudential than men counterparts, as men are governed by senses and pleasure but women on
meaningful prudential persons, showing obviously women were more learned and wise in
their very society itself is obvious;

Here we see the concept prevailing on early contracts - what is not presently applicable
automatically makes the man as a dead person or a non-person disables him to enter into
any future contracts, as such - to go in for any contract ... (here of bets);

Similarly, when you are not present in future then you are a non-person, so you cannot go
for contracts at all.

That way the very Constitution of India is also built, as the basic founder of the constitution is
very Mahatma Gandhi - K Gandhi.
Look back again, Constitution of India itself is a contract obligation with the general public
of India, not any single community as such;

The question arises how the Art 366 can be in the very constitution is a basic question as per
the conventional understanding of contracts as shown in Gita dharma.

Art 366 talks about future; not the present of 1947 when the Constituent assembly sat and
contrived the specifics of the Constitution of India, obviously theAssembly cannot venture on
future of the said contract, that way the principle of Force theory is abandoned; when
abandoned how a governments formed by parliamentarians appropriate their rights under
Art366, is the question that needs to answered.

In fact, art 366 is a dead article in the constitution, as obligations under Art 13 is always
there as the fundamental right under the basic structure of the constitution of india, that way
Kesavananda Bharati v st of Kerala emanated and decided by 13 member constitution court,
that reiterated the basic structure doctrine that revived Art 13, by Art 13(2) , that means, a
constitution amendment that abridged Art 13 (very heart of the constitution beats, no surgeon
cannot stop the heart so long that it cannot revive - a doctrine of commonsense under civil
law jurisprudence, as India is a civil law country, for she followed a parliamentary democracy
where the UK parliamentary system is to prevail - in fact, it should be noted there are no
constitutional amendments in the UK to the Magna Carta of 1215, or Bills of rights so far in
the UK ) (so it is obvious Indian parliament is obviously flouting the basic principle
of contracts as also the constitutional principles till date.

Therefore, any wise judge with wisdom would control the defacto parliamentary democracy
of India.
 WHAT IS CONTRACTUAL OBLIGATION?

Contract obligations are those duties that each party is legally responsible for in
a contract agreement. In a contract, each party exchanges something of value, whether it be a
product, services, money, etc. On both sides of the agreement, each party has various
obligations in connected with this exchange.

An example of contract obligations is with the sale of a product such as an automobile. One
party has the obligation to transfer ownership of the car, while the other has the obligation to
pay for it. The contract will specify the terms that regulate the obligations, such as the method
and amount of payment, and the time/place of delivery.

If either party fails to perform their contractual obligations according to the contract terms, it
will usually result in a breach of contract. This may result in a damages award to reimburse
the non-breaching party for their economic losses.

WHAT ARE SOME EXAMPLES OF CONTRACTUAL OBLIGATIONS?

As mentioned, contract obligations generally depend on the specific subject matter of the
contract. Contract obligations for a sales contract may be much different than other types of
contracts, such as a rental agreement contract. However, most legal agreements contain some
of the same types of contract obligations, such as:

Payment: One party (the buyer) is usually legally bound to provide payment for the sale of
goods or services. The contract terms may state obligations regarding payment amounts and
the deadline for payment.

Delivery: The seller is usually bound to provide delivery of the goods or services. Again, the
contract may state specific obligations in terms of delivery dates, method of delivery and
other terms.

Quality of Goods: The seller may also be bound to provide goods of a certain quality. This
may be specifically described in the contract
These types of obligations can vary according to the individual details of the contract. In
addition to these specific obligations, each party in a contract is also bound by certain general
principles and obligations when forming the contract.

For instance, each party is obligated to deal fairly and truthfully with the other party, and each
party is also obligated to refrain from using force or coercion in obtaining the agreement.

CAN CONTRACTUAL OBLIGATIONS BE TRANSFERRED TO

ANOTHER PARTY ?

In some cases, contract obligations can be transferred to a third party. For instance, if one
party is obligated to paint the other partys house, they can sometimes hire an outside party to
do the painting for them. This is known as contract delegation. Contract delegation may or
may not be allowed for all obligations; the ability to delegate a contract duty may depend on
the type of obligation as well as state contract laws.

For instance, a contract obligation usually cant be delegated if it involves unique

craftsmanship or artistic ability that can only be performed by the specific party to the
agreement.

Transference of contract rights (in contrast to the duties) is known as contract assignment.

CONTRACTS NATURE OF CONTRACTUAL OBLIGATIONS

The purpose of a contract is to establish the agreement that the parties have made and to fix
their rights and duties in accordance with that agreement. The courts must enforce a valid
contract as it is made, unless there are grounds that bar its enforcement.

Statutes prescribe and restrict the terms of a contract where the general public is affected. The
terms of an insurance contract that protect a common carrier are controlled by statute in order
to safeguard the public by guaranteeing that there will be financial resources available in the
event of an accident.

The courts may not create a contract for the parties. When the parties have no express or
implied agreement on the essential terms of a contract, there is no contract. Courts are only
empowered to enforce contracts, not to write them, for the parties. A contract, in order to be
enforceable, must be a valid. The function of the court is to enforce agreements only if they
exist and not to create them through the imposition of such terms as the court considers
reasonable.

It is the policy of the law to encourage the formation of contracts between competent parties
for lawful objectives. As a general rule, contracts by competent persons, equitably made, are
valid and enforceable. Parties to a contract are bound by the terms to which they have agreed,
usually even if the contract appears to be improvident or a bad bargain, as long as it did not
result from FRAUD, duress, or UNDUE INFLUENCE.

The binding force of a contract is based on the fact that it evinces a meeting of minds of two
parties in GOOD FAITH. A contract, once formed, does not contemplate a right of a party to
reject it. Contracts that were mutually entered into between parties with the capacity to
contract are binding obligations and may not be set aside due to the caprice of one party or
the other unless a statute provides to the contrary.