 Section 10 of the Indian Contract Act lays down the conditions which makes an

agreement a valid contract under law. Free consent of parties, no illegal object, lawful
consideration, competence of parties to contract, not expressly declared void by law.
 Section 13 of the Indian Contract Act talks about Consensus Ad Idem. When parties
agree to the same thing in the same sense.
 Section 14 of the Act talks about free consent. Consent is not free when there is fraud,
coercion, misrepresentation, undue influence or mistake.
 Section 11 says who cannot enter into a contract: minors, person of unsound mind,
persons disqualified by contracting by law.
 Tender is an offer to perform.
 S.18 says time is of essence if it is expressly said so or else according to S.46 the
contract can be performed in a reasonable time.
 S.62 talks about the novation of contract.
 In cases of mortgage or to provide any security for repayment of loans the court may
specifically enforce such contracts.
 Bailment: A leaves a horse with B a bailee. If the horse suffers a permanent injury
while in B’s possession, the measure of damages is the difference between the
original value of the horse and its value after injury. (hastmal v raffi Uddin, MP high
court)
 A contract by which a party promises to save another from loss caused by the conduct
of the promisor, or by the conduct of another person, is called a ‘contract of
indemnity’. (S.124, Contract Act)
 A ‘contract of guarantee’ is a contract in which one party agrees to perform the
promise or discharge the liability of a third person in case of her default. The person
who gives the guarantee is called ‘surety’ and the person on whose default the
guarantee is given is called the principle debtor and the person to whom guarantee is
given is called ‘creditor’. (S.126)
 A agrees to act as surety for any default by B in respect of an overdraft account with a
bank, C. This is a continuing guarantee.
 Bailment is S.148 of the ICA. In bailment you deliver the goods to someone for a
particular purpose, and contract with them that when the purpose is accomplished the
goods will be returned or disposed off according to the bailor’s wishes.
 If the contract of bailment does not provide for any compensation, the bailor has to
compensate the bailee the necessary expenses incurred. S.158 ICA
 The standard of care is proportionate to the care the bailee would take of his own
goods. S.151 ICA
 Pledge is when goods are bailed as security for payment of a debt or a performance of
a promise.
 S.189 doctrine of necessity.
 Three negotiable instruments: a bill of exchange, a promissory note and a cheque
under the negotiable instruments act. They can only be for payment of money.
 S.73 of the Indian Contract Act talks about damages.