Sources of Law:

Primary Source of Indian Law

1) Customs:

Customs with sanction

Customs without sanction

Requisites of a valid custom: Consistency, compulsory observance, conformity with law, certainty,
immemorial, peaceable enjoyment, reasonableness, unanimity of opinion

2) Judicial precedence

Declaratory

Persuasive

Absolutely authoritative

Conditionally authoritative

Important terminology related to precedents

 Doctrine of Stare Decisis – a principle of law which has become settled by a series of
decisions generally is binding on the courts and should be followed in similar cases

 Ratio Decidendi – authority of decision

 Obiter Dicta- said by the way – observations of judges

3) Statutes or Legislation

a. Jus scriptum [written Law] – American Constitution & Indian Constitution

b. Jus non-scriptum [unwritten Law] – British Constitution

4) Personal law

Secondary Source of Indian Law: Justice, Equity and Good Conscience

Branches of law:

Civil, mercantile or commercial, administrative, constitutional and criminal law

• Sources of Mercantile law: common law, the law merchant, statute, principles of Equity

--Indemnity:

The right of the surety is known as the right of subrogation namely the right to stand in the
shoes of the creditor.

--Right to sue: surety has a right to require the creditor to sue for and recover the guaranteed debt.
This right of surety is known as right to file a ‘Quia timet action’ against the debtor.
--This right of lien (Bailee) is a right to retain the goods and is exercisable where charges due in
respect of goods retained have not been paid. The right of lien is a particular lien for the reason that
the bailee can retain only these goods for which the bailee has to receive his fees/remuneration.

--The Rule of Agency is based on the maxim “Quit facit per alium, facit per se:” i.e., he who acts
through an agent is himself acting

Consideration not necessary in agency contract

--Sub agent: a delegatee cannot further delegate. [“delegatus non potest delegare]

--Respeit demino - the loss falls on the owner

--Nemo Dat Quod Non Habet – No one can pass a better title than he himself has [A seller of goods
cannot give a better title to the buyer than he himself possess]

--Types of company

1) Incorporation: Chartered, statutory and registered

2) Liability: Unlimited, limited (by guarantee and share capital
3) Control: government, holding, subsidiary, associate, foreign and Nidhi

Types of registered company: One-person, small company, foreign company, section 8 company
and producer company