TABLE OF CASE LAWS day, February 14,2 a2.06PM CASES. ‘The Plaintiff, believing Defendant's advertisement that its product would prevent influenza, bought a Carbolic ‘Smoke Ball and used it as directed from November 20, 11891 until January 17,1892, ‘when she caught the flu Plaintiff brought suit to recover ‘the LOGE, which the Court found her entitled to recover. ‘The defendant ran a self-service shop in which non-prescription drugs and medicines, many of Which were listed in the Poisons List provided in the Pharmacy ‘and Poisons Act 1933, were sold. ‘These items were displayed in ‘open shelves from which they could be selected by the customer, placed in a shopping basket, and taken to the till Where they would be paid for. ‘The tll was operated by a registered pharmacist ‘However, the claimant brought proceedings against the defendant for breach of section 18(1) of the Pharmacy and Poisons Act 1933, which requires ‘the supervision of aregistered pharmacist for the sale of any item inthe Poisons List. = ‘a couple went to England on leave For health reasonsthe wife was unable to accompany ‘the husband again to Ceylon (Husband's place of work} AUTHORITIES SE + Section 2(d) of ICA 1872- consideration elssue ‘This case considers whether an advertising gimmick (Le the promise to pay 100£ to anyone contracting influenza while using ‘the Carbolic Smoke Ball) can be considered ‘an express contractual promise to pay. * Defendant's Appeal was dismissed, Plaintiff was ‘entitled to recover 100E. "The Court acknowledges that in the case of. vague advertisements, language regarding Payment of a reward is generally @ puff, which carries no enforceability. * Inthis case, however, Defendant noted the deposit of £1000 in their advertisement, as a show of their sincerity. * Because Defendant did this, the Court found ‘their offer to reward to be a promise, backed by ‘their own sincerity Issue * Whether the contract of sale was concluded when the customer selected the product from the shelves (in which case the defendant was in breach of the Act due to ‘the lack of supervision at this point) or "when the items were paid for (in which case ‘there was no breach due to the presence of ‘the pharmacist at the til) + Section 25(1) of ICA 1872- Agreement without consideration is void, unless, ‘it was not expressed in writing and registration on account of love and affection + Section 10 of ICA 1872 - What agreements are contract PRINCIPLES “+ Wagering contract it should be acted upon, andit was acted upon There was ample Consideration for the promise, and that, ‘therefore plaintiff is entitled to recover the rewards ‘*Standing offer with public until the offer is. not withdrawn ‘This case stands for the proposition that while sales puffery in advertisements s generally not intended to create a contract with potential product buyers, in this case it did because the Defendant elevated their language to the level ‘of promise. by relving on their own sincerity. “+The mere fact that a customer picks up a bottle of medicine from a shetf does not ‘amount to an acceptance of an offer to sel but isan offer by the customer to buy "The Court of Appeal held that the defendant was not in breach of the Act, asthe contract, \was completed on payment under the supervision of the pharmacist. "The display of the goods on the shelves were not an offer which was accepted when the customer selected the item; * Rather, the proper construction was that the customer made an offer to the cashier upon arriving at the til, which was accepted when Payment was taken * This analysis was supported by the fact that ‘the customer would have been free to return any ofthe itemsto the shelves before a Payment had been made. “= No bargain “No intention to make ita contract “*Consideration ‘Some right- profit- benefit forbearance: loss~ responsibilty given or suffer ‘*The consideration, as we know, may consist‘The husband promised to pay30 | _* All agreement are contract ifthey are either in some right, interest, profit, or benefit pounds per month to his wife as made by ‘accruing to one party, or some forbearance, ‘maintenance, but he failed to co the free consent of parties, detriment, loss, or responsibility pay competent to contract given, suffered, or undertaken by the other. ‘The husband was held not liable, © for lawful consideration asthere was as no intention to ‘and with a lawful object ‘Parties did not intend that they should be ‘© and are not hereby expressly attended by legal consequences declared to be void ‘onsideration obtains natural love & “Nothing herein contained shall affect any affection aw in force in India and not hereby ‘expressly repealed by which any contract is, required to be made in writing or in the presence of witness or any law relating to the registration of documents ‘Here no intention to make contract + Section 8 of Indian contract act 1872 Ratio Decidendi * *To have complete knowledge of the facts of * In this case, the defendant Gauri ing the offer or proposal Dutt’s Nephew had absconded consideration + Acceptance ofthe offer andwasnowhereto befound Issues * A person to whom the offer is made, the ‘After the defendant became __* Whether Lalman Shukla was entitledto getthe __offeree, must accept the proposal The aware ofthe same, Dutthad reward from Gauri Dutt for tracing the missing communication regarding the offer is also very sent allthe servants in search of _ boy. important as mentioned in section (a) of the ‘the missing nephew. "Whether there was avalid acceptance ofthe ICA. It states that communication can only be * The plaintiff Lalman Shukta was _ offer made by the plaintiff complete when it comes to the knowledge of one of the servants who had * Whether there exists a contract or whether the the person to whom itis made. {gone out in search of the situation amounts to a contract between the nephew. The plaintiff eventually two **To convert a proposal into an agreement both ‘ound him and brought him knowledge and assent must be present. Here, back ‘Shukla had no idea that such an inthe given instance, both were missing announcement was made~ He found the * When Lalman Shukla had left the nephew and brought- Six months after the = As the plaintiff had no knowledge and hadn’t house to leave for Haridwar from said incident occurred, Dutt sackedthe given his approval or accepted the proposal Kanpur he was handed some plaintift. there did not exist avalid contract betwveen ‘money for his railway fare and ‘After being removed from the job, the thetwo. ‘other expenses As soon as plaintiff claimed the money from the Lalman Shukla had left the defendant and the latter denied to pay the * At the time when the plaintiff was searching house, the defendant announced said remuneration for the boy, his obligations and duties were as areward of Rs 501 for "The plaintiff wasin the service of the defendant. a servant. Therefore the plaintiff Laiman Whosoever found Dutt’s * Duty and obligation was on him to search the Shukla was not entitled to get the award nephew. boy. * He obliged to duty before the handbill of reward The judgement was offered ‘Inthe said case, the petitioners’ appeal * Gauri Dutt argument ‘against the respondent Gauri Dutt was ‘Section 2( a) dismissed by the court. ‘*Section2 (b) “Here, the plaintiff did not know the ‘if there is intent to accept, the contract reward before performing his act. He arises upon performance of the requested ‘only came'to know about it later, in services during the continuance of the which case there was no possibility of offer and the offeree is then entitled tothe. ‘accepting the offer. reward promised. ‘*Hence, there was no contract Therefore, Lalman Shukla was not entitled to get or claim the reward, «Sections 3 & 4 of ICA 1872. “A contract unlike atort isnot unilateral ‘The rule which determinethe place, _* There should be meeting of minds for where contract is made contract * On July 22nd 1959, Kedia ‘Dealswith communication, acceptance _ Entores Ltd. V. Miles Far East corporation Ginning Factory and O11 Mills ‘and revocation of proposals 1955)? 0B 327)«Section 4- —The communication of @ proposal is complete when it comesto the knowledge of the person to whom itis, made + Section 5 of ICA 1872 Revocation of proposals and acceptances ‘*A proposal may be revoked at any time before the communication of its acceptance is complete as against the proposer, but not afterwards ‘+An acceptance may be revoked at any time beforethe communication of the acceptance is complete as against the acceptor, but not afterwards +The respondents contended that the cause of ‘action for the suit arose at Ahmedabad as the appellants offer to sell was accepted at ‘Ahmedabad and the appellant was to be paid for ‘the goods through abank in Ahmedabad ‘The appellant contended that the respondents! offer to purchase was accepted at Khamgaon; ‘the delivery and payment of the goods were also ‘agreed to be made in Khamgaon and the City Civil Court of Ahmedabad did not have jurisdiction to try the suit (appellant) of Knamgaon entered into a contract over telephone to supply cotton seed cakes to M/s GGirdharilal Parshottamdas and Co. (respondents) of ‘Ahmedabad "The respondents commenced an action against the appellant in ‘the City Cil Court of ‘Ahmedabad for failing to supply cotton seed cakes as per the aforementioned agreement "The City Civil Court of ‘Ahmedabad held that it had jurisdiction asthe acceptance of ‘the offer was intimated to the offeree at Ahmedabad and that is where the contract was made "The appellants filed arevision application in the High Court of Gujarat which was rejected. Then, the appellants preferred ‘an appeal to the Supreme Court with special leave ‘Harvey V. Facey (1893) ACS52 * Harvey sent aTelegram to Facey which stated:- ‘Will you sell us Bumper Hall Pen? Telegraph lowest cash price-answer paid;* + Facey replied by telegram: Lowest price for Bumper Hall en £900." * Harvey then replied ‘© "We agree to buy Bumper Hall Pen for the sum of nine hundred pounds asked by you Please send us your title deed in order that we may get early possession" *Section9 - Promises, express and implied ‘In 0 far as the proposal or acceptance of any promise made is made in words, the promise is said to bEEKBFESS In so far as such proposal or acceptance is made otherwise than in words, the promise is said t Issues * Paul Felthouse sued Mr Bindley in the tort ‘of conversion, with necessary to show ‘that the horse was his property, in order to prove there was avalid contract. "Mr Bindley argued there wasno valid ‘contract for the horse, since the nephew had not communicated his acceptance of ‘the complainant's offer ‘The complainant, Paul Felthouse, brad a conversation with his nephew, John Felthouse, about buying his horse ‘After their discussion, the uncle replied by letter stating that ithe didn’t hear anymore from his nephew concerning the horse, ‘The rule about instantaneous ‘communication (telephone) - fo the contract is only complete ‘when the acceptance is received by the offeror ( proposer) © Contract is made atthe place where the acceptance is received * Contract by post ‘© Acceptance is complete as soon as the letter is put into the post box ‘Place of acceptance is the place where contract is made Hebbs* ‘The post was the common agent of both the parties ‘+The theory of expedition ‘The acceptance was put in the course of ‘transmission at Khamgaon and under the Words of our statute Ifind it dificult to say ‘that the contract was made at Ahmedabad where the acceptance was heard and not at Khamgaon where it was spoken ‘Judgement: The court held that the contract act does nat expressly deal with the place Where a contract has been made As against cases of correspondence by post or telegram, in the present case of correspondence by a telephone, ‘*The mere statement ofthe lowest price at Which the vendor would sell contains no, implied contract to sell at that price to the ‘persons making the inquiry ‘+ no evidence of an intention that the telegram sent by Facey wasto be an offer. * It was held that there was no contract for the horse between the complainant and his nephew. There had not been an acceptance of the offer; silence did not amount to acceptance and an obligation cannot be imposed by another. "Any acceptance of an offer must be communicated clearly, Although the nephew had intended to sell the horse to thehhe would consider acceptance of ‘the order done and he would ‘own the horse. * His nephew did not reply to this, letter and was busy at auctions "The defendant, Mr Bindley, ran ‘the auctions and the nephew advised him not to sell the horse. However, by accident he ended up selling the horse to someone else, ‘Standing offer ‘The facts giving rise to this appeal by special leave, are these: #2. The Dominion of India, asthe owner fof the Madras and Southern Mahratta Railway, represented by the General ‘Manager of that railway, invited ‘tenders for the supply of jaggery to the railway grain shops * The respondent submitted his tender for the supply of 14,000 imperial ‘maunds of cane jaggery during the ‘months of February and March 1948. ‘The tender form contained anote in Para2 which was meant for the ‘quantity required and the described dates of delivery. This note was: * "This Administration reserves ‘the right to cancel the contract ‘at any stage during the tenure of ‘the contract without calling up ‘the out standings on the unexpired portion of the contract’ * The dates for the delivery ofthe four instalments were slightly changed by a subsequent letter, dated February 28, 1948, "The issue in this case was whether silence or | complainant and showed this interest, there ‘failure to reject an offer amount to was no contract of sale acceptance Thus, the nephews allure to respond to the ‘SEion7, Acceptance MUSE BEBBEGIUEIn order complainant did not amount to an acceptance 10 convert a proposal nto a promise, the of his offer. acceptance must (Q) be absolute and unqualified; 2) be expressed in some usual and reasonable ‘manner, unless the proposal prescribes the manner in which i isto be accepted Ifthe proposal prescribes a manner in which it isto be accepted, and the acceptance is not made in such ‘manner, the proposer may, within a reasonable time after the acceptance is communicated to him, insist that his proposal shall be accepted in ‘the prescribed manner, and not otherwise; but, if he failsto do so, he acceptsthe acceptance $.Mohan, J. in Tata Cellular v. Union of Ind tener ieanoter fn 1098S Ti hodabeenre TREE Steet revocaion ne sandsrenay | Reagent ote fscomening ‘The 'cipance’ of thetender, however, does wen ves nds commodo nocconverthe fern abiding convac for | not arcegrace Brood sate, the Soma of steps that the Bayer at folowing we therequstesof aval dared wo secept the good tenor -Tipuch termi contat whic destroys the OL Rube unondtont dontaefas aroedng othe eater ters 2 2 Must be mode atthe proper Te ples the aleged coma which waul have Deen dus cont tothe tems of bindngon the epplire eatin, Section 10 of CA wha agreements re contact oa Musbe mode tthe proper + Secon 23 of cA572 tine < Hint contceraionad objects ae owl and 05 Mux-bemade nthe proper tit no The concern or ojet of on forms Sgeemere sifu, ues 06 The persny whom the forbidden by a oF ender emade ust be ale and {Teor suenanoture tha if permed k vag perform Nis obgons rut defeat the pons any Ion oF o7 There ut bereesnase sista or ‘eportunty for inapecion, “volvesar ples into the person o oe Tender mum bemode othe Hopes of mathe proper perso, «She Cou regards as inmoral 9 Rr be tl amount opposed tobe pate + Theta Cur domised ne au hale tat «Ivenah ofthese aves the consideration or "the ralwayadminsraton could cancel she object of anagreementissaldtobe contract haut ging ay reason whenever unlawful. Every agreement of which the it iked, without making itself iable to pay any objector consideration is unlawful isvoid damages ‘+ The High Court held that the clause reserving 3. By his letter, dated March8, 1948, the Deputy the right inthe appellant to cancel the General Manager informed the respondent that contract was void and in view of the tril Court ‘the balance quantity of jaggery outstanding on having not decided the issue about damages, date against the order, dated February 16,1948, remanded the sult for disposal after dealing betreated as cancelled and the contract closed. with that matter. * The protests ofthe respondent were of no avail «Supreme court upheld the judgment of the asthe railway administration tookits stand high court and dismissed the petition! ‘against the stipulation that the right to cancel the contract at any stage was reserved to it * Utimately, the respondent instituted the suit ‘against the Union of india for recovering ‘damages resulting from breach of contract,The respondents advertised for receiving tendersfor the sale of Tendu- Pata (leaves) from unit No. 7, Budni. ‘The petitioner gave atender in pursuance of the tender notice No. #1972-X 69 dated25,3.1969 at the rate of Rs 38.25 p per standard bag. ‘He also deposited some amount as security. The tenders were to be ‘opened on 3th April1969 but before ‘they were actualy opened, the petitioner made an application (Annexure_A’) resting rom his tender ‘and requested that since he has withdrawn his tender, it may not be ‘opened at all The tender was, however, opened as ‘this was the only tender submitted for ‘that unit. The Government accepted ‘the tender and since the petitioner did not execute the purchaser's ‘agreement, proceedings were now being taken for recovery of Rs 24,846.12 on the allegation that the ‘Tendu leaves ofthe unit were sold to somebody else later and the balance was recoverable from the petitioner *TenduPatta ‘The first respondent invited tenders or execution of five items of work including supply, delivery and stacking ‘0f75,000 cubic metre machine crushed track ballast as per specifications atts depot in Naurozabad and loading it into Railway wagons +The supply period wasfor 24 months The conditions in thetender notice required that the rates at which supply was to be made had to be stated in ‘words as well as in figures against each item of work as per Schedule attached thereto; that the tenders submitted with any ‘omissions or alteration of the tender document were liable to be rejected; ‘however, permissible corrections could be attached with due signature of the tenderers; ‘thatthe tenderer should hold the offer ‘opentill such date as may be specified inthe tender which was for 2 minimum period of 90 daysfrom the date of ‘Article 226 of Indian Constitution + Section 23 of ICA 1972 ‘ What consideration and objects are lawful and ‘what not © Provision may defeat the provision of any law Fraudulent co Injury to person colmmoral ‘The reply on behaif of the respondents is that under the tender condition No. 10 (b)()@ ‘tenderer may be allowed to withdraw his tender of any unt of a division before the ‘commencement of the opening of tenders of ‘that division on the condition that on opening ‘the remaining tenders, there should be at least ‘one valid tender complete in all respects ‘available for consideration for that particular unit ‘In this case, since there was no other tender, the ‘tender given by the petitioner could not be withdrawn. We are unable to accept this contention. A person who makes an offer is entitled to withdraw his offer or tender before its ‘acceptance is intimated to him. Inthe present case, the short question that falls for consideration is whether the tender offered by the appellant with the rebate could have been accepted and whether such acceptance would affect the interests of any other party “+ Now the appellant made his offer of ‘concessional rates along with the tender while respondent No, 5 made such offer after opening of the tenders. ‘It is difficult to conceive that the respondent No. 5 who isa prudent businessman would rot be aware of commercial practice of giving rebate or concession in the event of ‘quick finalization of atransaction ‘+ What the appellant offered was part of the ‘tender itseif while the respondent No.5 ‘made such offer separately and much later ‘There was nothing illegal or arbitrary on the part of Railway Administration in accepting ‘the offer ofthe appellant, which wasmade ‘at the time of submitting the tender itsef ‘*Tender legal, atthe proper time of ‘*The Government, by merely providing such a clause in tender notice could not take away ‘that egal right of the petitioner‘opening ofthe tender; ‘that contravention of the conditions ‘would automatically result in forfeiture of security deposit; ‘thatthe tender was liable to be rejected for non-compliance of any of ‘the conditions of the tender form ve persons including the appellant Participated in the auction Though the reserve price fixed in the tender notice ‘was Rs 95,000/-, the appellant's bid of Rs 92,001/-, being the highest, was ‘accepted by the Divisional Forest officer ‘+The Finance Department invited ‘comments from the Divisional Forest Officer as to why the settlement was made for alesser amount. ‘+ Matter was pending Appellant filed ‘application to settlement on the basis of highest bid of 95000/- ‘The minister of forest directed that ‘coup may be settled with highest bidder - Appellant but no intimation was received by divisional forest officer - he did not communicate the proceeding of the minister to the appellant + One Md Yakub- filed a petition before Gut offering101125/- + As previous communication was not ‘transferred to appellant The previous settlement with appellant was ‘cancelled and settled with Md yakub for 101125/- ‘The sult was instituted on oF about the 10th of December, 11954. The suit arises from a deadly and tragic air crash that ‘ook place in Nagpur on the 12th December, 1953 around3:25, ‘am when Dakota aeroplane \VI-CHF crashed when it started to fly towards Madras The route of the plane was Nagpur to Madras All the passengers and ‘the crew members died in this air crash and only the pilot, Desmond Arthur James Cartner remained alive (Om the same aircraft ayoung business +The special conditions in the tender notice ‘makes clear that the Divisional Forest Officer thas the right to accept abid of less than Rs '5,000/-, that acceptance of a bid of more than Rs 5,000/- by him is subject to confirmation by ‘the Chief Conservator of Forests and the Forest Department of the Bihar Government and that @ bid made in auction and which has been provisionally accepted by the Divisional Forest Officer shall be binding on the bidder for two ‘months from the date of auction or till the date of rejection by competent authority whichever is. earlier + Appellant ‘There was a concluded contract when the Government confirmed the acceptance, even ‘though the confirmation was not communicated ‘to the appellant ‘Arguments put forward by the plaintiff ‘© Onthis ground the defendant is liable for ‘damages for breach of contract for not safely carrying the passengers on board and ‘or breach of duties under the Carriage by Air Act andor of the notification ‘thereunder. ‘+ An alternative plea in the plait also states ‘that the defendant was liable for negligence ‘andor misconduct. The particulars of negligence was also specified in the plaint in the following words— ‘The port engine of the plane lost power after getting ar-borne causing a swing and ‘that it was due to defective supervision and check up, The defendant, Indian Airlines Corporation relied fon the exemption clause’s T&Cs of the ait ticket dated 11.12.1953 issued by deceased Judgement ‘Here the acceptance made by Minister of state was of second offer of 95000/- not to original bid settlement which was 92001/- + We are, therefore, of the opinion that ‘there was no concluded contract between. ‘the appellant and the Government. Iudgemene The teamed ia udge held that te compton cue wes led, val trroneourandvoid The eaned ge retedonthe case Sec) ofStatew Me Rulon AIR 1937 Negpur S54) to decide onehispae W aroeld Cptain Cree’ negigene The court also held thatthe obligation imposed by law on common carriage isnot founded upon a contract, but on the exercise of public {employment for reward, because the Indian Contract Act itself has application. Th ‘the deceased ‘and came to a conclusion that the contract did not offend against the‘man of about 28 years of age, Sunil Baran Chowdhury was enroute to [Nagpur from Calcutta There are three plaintiffs in this case ~ 1L The widow of the deceased, Sunil Baran Chowdhury 2. His minor son 3. Hisminor daughter ‘The defendant in this sut is Indian Airlines Corporation, ‘It appeared that it was thought ‘advisable to erect aTown Hall at Howrah, provided sufficient subscriptions could be got together for ‘the purpose ‘To this end the Commissioners of the Howrah Municipality set to workto ‘obtain the necessary funds by public subscription, creating themselves, by deed, trustees of the Howrah Town Hall Fund ‘As soon as the subscriptions allowed, ‘the Commissioners including the plaintiff, who was also Vice Chaitman ‘of the Municipality, entered into a ‘contract with a contractor for the purpose of building the Town Hal, estimates and plans were submitted to, and approved by, the Commissioners, the original estimate ‘amounting to Rs 26,000. ‘This estimate, however, was increased ‘toRs 40,000, and it was found that ‘the subscriptions would cover this ‘amount, and the original plans were ‘therefore enlarged and altered ‘The defendant was a subscriber to this ‘+The corporation would not be liable to the passengers or his or her legal ‘representatives or dependant for death, Injury or delay to the passenger or to his property ‘The defendant denied the allegations of, misconduct, negligence, defective supervision or check up ‘The defendant also pleaded that in any ‘event that there was an error in judgement or which the pilot cannot be held liable and ‘thatthe pilot was a skilled and competent ‘expert and acted bona fide reasonably in good faith res ipso loquitor- The things speak for itself ‘the principle that the mere occurrence of some types of accident is sufficient to imply negligence, Esection 2(d) of ICA 1872 - consideration ‘the High Court on the following points: (1) Whether the suit as laid by the plaintiff was legally maintainable? (2) Whether, upon the facts stated, the trustees ‘were entitled to judgment?] ‘Without reference to his being atrustee or ‘@ Municipal Commissioner, we think that under the provisions ofthe Code of Civil Procedure he is entitled to bring an action on behalf of himself and others jointly interested with him Be Section 25 of ICA 1872 ‘Agreement without consideration, void, Unless it isin writing and registered or is 8 promise to compensate for something ‘done or is a promise to pay barred by limitation lav provisions f the Contract Act and that ft gave complete immunity tothe defendant from loss or damage consigned to its care for cariage The Bench observed that ithe deceased had by a contract during his lifetime excluded himself {om the right of claiming a damage, then his dependants or beneficiaries under the Act could not claim fe The learned tral judge held thatthe exemption ctause in the contract was good and valid and has a complete bart the plaints right of ation in the present case. The Bench held thatthe maxim of FEST) egior! may or may not apply to air accidents because ft solely depends upon the facts ofeach accident They also held that tis arule of evidence bearing primarily onthe question of The Bench assumed everything gainst Captain Cartner that his action was a all actionable negligence and they held that was at best only an error of judgement, by applying all the principles and facts of the case The Verdict The appeal was allowed The suit was dismissed and the exemption clause washeld good, valid and legal and there was no negligence of the defendant Corporation or of the pilot, Captain carter “Person were asked to subscribe knowing the purpose of money - an ol incurred to pay the contractor - contract “Valid contract for good considerationfund of rupees one hundred, having signed hisname in the subscription bookfor that amount. +The defendant not having paid his ‘subscription was sued in the Howrah Court of Small Causes by the plaintiff ‘as Vicechairman and trustee and ‘therefore as one of the persons who had made himsetf liable to the contractor fr the costs of the building, ‘to recover the amount entered in the subscription book, ‘The present respondents~ the ‘trustees entered into a contract forthe necessary repairs in the ‘month of February 1928, and the maistry of the contractor was supplied with money from village ‘common fund, ‘+ Asthe work proceeded more ‘money was required, andto raise this money subscriptions were invited and a subscription list formed This wasin October. ‘The present petitioner put himself down in thelist for Rs 125, and it isto recover this sum ‘thatthe suit was led. ‘Abdul aziz V. Masum Ali AIR 1914 All 2 +The plaintiffs sister, by deed of gift on ‘the Sth April1877, made over certain landed property to the defendant, her daughter. + By the terms of the deed which was registered, it was stipulated that an ‘annuity of 53 rupees should be paid every year to the plaintiffs as had hitherto been paid by the donor until a village could be given them. ‘The defendant on the same date ‘executed in plaintiffs favour a Kararmama promising to give effect to ‘the stipulation of the deed of gift by paying the annuity until she gave them avillage ‘The annuity was not paid and the plaintiffs sued to recover it + Nawab Khwaja muhammad khan V. The lower Court has decreed the suit The plaint founds the consideration for this promise as follows: ‘That plaintiffs relying on the promise from ‘the subscriber incurred liabilities in repairing the temple The question is, does ‘this amount to consideration? The definition of consideration in the Indian Contract Actisthat where at the desire of ‘the promisor the promisee has done or ‘abstained from doing something, such acts or abstinence is called consideration «Therefore, the definition postulates that the promisee must have acted on some ‘thing amounting to more than a bare promise. There must be some bargain between them in respect of which the consideration has been given | *Section 2 (d) of India contract act 1872 - future ‘consideration +The Courts below have found, upon evidence ‘warranting the finding, that there was no coercion, but that the document was executed ‘and registered voluntarily by defendant. + Section 23 of ICA 1872 ‘Its not pleaded, nor is there evidence, that there was any request by the subscriber ‘when he put his name in thelist for Rs. 125 to ‘the plaintiffs to do the temple repairs or that ‘there was any undertaking by them to do anything ‘Bare promise unsupported by consideration “*No suit could be brought after his death against his heirs. '*Dutton V. Poole [2 Lev 2010 1 Ventr. 318] ‘The son had the benef ofthe timber & the daughter had lost her portion ‘through the promise of son #50 she can sue for the contract between her father and brother “+A consideration indirectly moved from plaintiffs to the defendant. ‘Tweddle V. Atkinson [30 LI QB 265), + Pruity of contract “+ Entitled to get the kharach | pandaan - astheyNab Husain Began (2810)37 1A i +The st which has ven seo this eal was rough by the pa Hastomedan ay, agar the disendar her aero, to recover ores of cere alone, alec Fpandan, under ene fomrotonageenert cxectedby him on Ober 251077 pir to and Incondderatin of her morige wth hisson Ruste Al Ken both she and fer rue usbnd being oanors the time The agreementin question rectesthat the mariage ward for November 207, ond hat —thereorel the Gitendort dedoredt his own ree wi sea ocardtht he sal conn pay Rs 500 per month in perpetuity|] tothe pl ore beet copenses fam the de ofthe mmartoge Tom the date of her Teception, || out of the income of Ceranpeoperiestheren pecely desrbed which he ten poceeded'o charge ortnepoymene ofthe alowonce * Dharmodas Ghose, wasthe respondent in this case. He was a ‘minor (ve. has not completed the18 Years of age) and he was the sole ‘owner of his immovable property. The ‘mother of Dharmodas Ghose was ‘authorized as his legal custodian by Calcutta High Court + When he went for the mortgage of his, ‘own immovable property which was done in the favor of appellant ie Brahmo Dutta, he was aminor and he ‘secured this mortgage deed for Rs 20,000 a 12% interest rate per year. * Bhramo Dutta who was amoney lender at that time and he secured a loan or amount of Rs 20,000, andthe ‘management of his business was in the control of Kedar Nath, and Kedar Nath ‘acted as the attorney of Brahmo Dutta * Dharmodas Ghose’s mother sent a notification to Brahmo Dutta informing hhim about the minority of Dharmodas ‘Ghose on the date on which such mortgage deed was commenced but ‘the proportion or sum of loan that was ‘What considerations and objects are lawful, and what not * Defendant claim ‘Plaintiff is no party to contract “She forfeited her right to allowance as her refusal to live with her husband His majesty in council ‘+ As marriage were between minor and contract was between parent on behaif of ‘the couple “No suit by husband for conjugal right TE Semen SIE Issues Raised in this case were: ‘* Whether the deed was void under section 2, 10{5],11{6}, of Indian Contract Act, 1872 or not? ‘Whether the defendant was liable to return the amount of loan which he had received by under such deed or mortgage or not? ‘+ Whether the mortgage commenced by the defendant was voidable or not? * Section 10- what agreement are contract * Free consent ‘Parties Competent to contract + Lawful consideration + Lawful object Section 11 of ICA 1872 ‘+ Who are competent to contract ‘© Age of majority according to the law to which heis subject ‘© Whois of sound mind © Not disqualified from contracting by any law to which he is subject ‘According to he verdict of Trial Court, such ‘mortgage deed or contract that was commenced ‘actually provided waslessthan Rs between the plaintiff and the defendant was 20,000. void as it was accomplished by the person who ‘+The negotiator or representative of the was an infant atthe time of execution of were minors all decision was taken by parents on their behat ‘+ Husaini begam was entitled to get the benefit even she is living in her matrimonial home or not , Because all the matrimonial rights and duty start from the day of marriage «there is no condition that it should be paid only whilst the wife is ling in the hhusband’s home, or that his ibility should cease whatever the circumstances under Which she happens to leave it '*A person who by reason of infancy is as laid down by section 11 of ICA, incompetent to contract, cannot make a contract within the ‘meaning of the act The transaction entered can not be recognised by law '* According to the decision of Calcutta High Court, they agreed with the verdict that was given by Trial Court and it dismissed the appeal of Brahmo Dutta ‘*Then he later went to Privy Council for the ‘appeal and later the Privy Council also dismissed the appeal of Brahmo Dutta and held that there cannot be any sought of contract between a minor and a major person. '*The final decision that was passed by the Council were = ‘*1LAny sought of contract with a minor or infant Js void/ void ab-intio (void from beginning). '+2.Since minor was incompetent to make such ‘mortgage hence the contact such made or commenced shall also be void and id not valid inthe eyes of law. '+3.The minor Dahrmodas Gosh cannot be forced to give back the amount of money that was advanced to him, because he was not bound by the promise that was executed in a contractdefendant, who actually acted instead ‘of on behalf of money lender has given ‘money or sum to the plaintiff, who was ‘aminor and he fully had knowledge ‘about the incompetency ofthe plaintiff ‘to perform or enter into contract and ‘also that he was incompetent legally to ‘mortgage his property which belonged tohim ‘after that, on 10thSept 1895 Dharmodas Ghose along with his ‘mother brought an legal suit or action ‘against Brahmo Dutta by saying that ‘the mortgage that was executed by Dharmodas was commenced when he \was a minor or infant and so such ‘mortgage was void and disproportionate or improper and as @ result of which such contract should be revoked or rescinded. + When this petition of claim wasin process, Brahmo Dutta had died and ‘then further the appeal or petition was litigated or indicted by his executor's mortgage, When Brahmo Dutta was not satisfied with the Verdict of Trial Court he filled an appeal in the Calcutta High Court slssues ‘* Whether a minor, who, by falsely representing himself to be amajor, has induced a person to enter into a contract, is estopped from pleading his minority to avoid the contract. ‘© aperson to contract with him by means ofa false representation that he was of full age, he snot estopped from pleading his infancy in avoidance ofthe contract. - Asthe ‘opposite member knowingly may enter into contract ‘+ Whether a party, false representation as to his age, whether he be defendant or plaintf, in a subsequent litigation, refuse to perform the contract and at the same ‘time retain the benefit he may have derived therefrom. © Doctrine of restitution © an infant though not liable under the contract, may in equity required to return the benefit he has received by making a false representation asto his age Plaintiffs brought a suit for possession of haifa square which had been sold to ‘them by defendant 1 for Rs 17,500 out ‘of which Rs. 8,000 had been paid in ‘cash before the Sub-Registrar and Rs {9,500 was secured by a promissory note payable on demand from the plaintiffs +The plaintiffs alleged that defendant 1 hhad been duly paid Rs 17,500 because ‘the promissory note for Rs 9,500 in his favour had been discharged by another promissory note executed by the plaintiff in favour of the defendant's brother-intaw Muhammad Hussain at ‘the request and with the consent of ‘the defendant, thatthe plaintiffs had ‘paid Rs 5,500 out of the Rs 9,500 to ‘Muhammad Hussain and were prepared to pay the balance. ‘The trial Court decreed the suit for possession holding that defendant 1 had made a false representation that hhe was of full age to the plaintiffs and was therefore estopped from raising ‘the plea of minority —— + Where money has been borrowed by two minors under a mortgage deed at atime when they ‘were minors, more than 18 years but less than 21 years of age, under afraudulent concealment ‘of the fact that the executants were minors because a guardian had been appointed for ‘them under the Guardians and Wards Ac, Principles of Law ‘The principles of law that were laid down in this case are ‘+ Any contract with a minor of an infant is neither valid nor voidable but is void 2b- intio(void from beginning} “= Section 64 of Indian Contract Act.1872 is only applicable inthe case, where the parties, centering in contact are competent to make such contract and is not applied to cases where there is no contract made at all ‘The legal acts done by an representative or ‘any knowledge of an agent means that such ‘acts done or having knowledge of anything is of his principal “+ Wsinda Ram V, Sita Ram Whether a minor is estopped from pleading minority when he has made a false representation asto his age ‘Original position no contract or give and take if minor has come into contract by representing itself as major “Doctrine of estoppel Section 115 of evidence act reads: ‘+ "When one person has, by his declaration, act for omission, intentionally caused or permitted ‘another person to believe athingto betrue ‘and to act upon such belief, neither he nor his representative shall be allowed, in any suit proceeding between himself and such person or his representative, to deny the truth of that hing” “Leslie V sheill- Doctrine of restitution + If he obtain goods- It can restore * Doctrine of equity + If goodsis sold cant berestore-Sono contract- Void ‘*Section 41 - Specific relief act- Doctrine of restitution «Strictly follow doctrine of restitution * Can not be extend to money cases + mortgage deed can not enforced‘+ Raghunath prasad V. Sarju Prasad (1923) 51 14101, Background of the Case ‘This case is one of the landmark cases when it comesto ‘free consent.” * Undue influence is one such instance where a consent is not said to be free ‘and the party whose consent was so ‘obtained, has the option to avoid the ‘contract ‘Hence, in the case of Undue influence ‘the contract is voidable in nature In ‘case of undue influence To prove ‘undue influence the plaintiff has to prove that the relations between him ‘and the defendant was such that the ‘L Real or apparent authority. 2. Fiduciary relationship, 3. Mental capacity is affected by reasons of age, illness or mental (or bodily distress of the plaintiff ‘Ganga Prasad Das Mushib AIR1967 SC 878 The plaintiff's father, Prasanna Kumar, ‘owned certain lands in two villages, ‘namely, Parbatipur and Lokepur, hholding an eight annas share in each ‘He had two sons, namely, Ganga Prasad, the plaintiff, + and Balaram, the second defendant in ‘the suit, besides a daughterSwarnalata ‘and an only grandson Subhash ‘Chandra, who was the first defendant + can the mortgage in a suit brought against them ‘get a decree for the principal money under. 65, Contract Act or under any other equitable principle, and can he also get a decree for sale of. ‘the mortgaged property EEE TTS) Facts of the Case ‘The case isan appeal from a decree, dated November 9, 1920, of the High Court of Judicature at Patna, which varied a decree, dated ‘September 25, 1917, of the Subordinate Judge of Arran ‘The defendant, Sarju Prasad Sahu and his father who was the plaintiff in this case, Mr. Raghunath Prasad Sahu were equal owners of amassive joint family property. They quarrelled and had ‘fights over this property. Due to the same, the father initiated criminal proceedings against his + The defendant mortgaged his properties to the plaintiff to defend himself and borrowed from ‘the plaintiff about ten thousand rupees at compound interest of 24 per cent. ‘In the course of eleven years, the rate of interest ‘on the amount borrowed magnified more than elevenfol, viz, Rs/-1,12,885. ‘The defendant's contention was that the lender ‘rad tokefiRGBRBCIORSBIEBUWaMiEaEe of his ‘mental distress by exacting high rates of interest ‘and therefore, there should be presumption of Undue influence i.e. Section 16 of the Indian Contract Act, 1872. Verdiet + Upheld the decree ofthe high court by allowing ‘compound interest on the principal at 2% per ‘mensen from the date of the execution of bond ‘ll September 25, 1917 ‘+ After September 25, 1917 a simple interest on ‘the principal at arate of six percent per annum upto the date of realization Judgement The Lordships observed that no presumption of Undue influence could be brought out from this case Lord Shaw referred to “Inthe first place the relations between the parties to each other must be such ‘that one i in a positon to dominate the ofthe other it Once that postion is substantiated the second stage has been reached, Viz, the issue whether the contract has been induced by undue infuence: Upon the determination ofthis issue athird point emerges, which isthat of HOS) ‘The burden of proving that the contract, was not induced by undue influence isto lie upon the person who was in a position ‘to dominate the will ofthe other. Error is almost sureto arise if the order of these propositions be changed ‘The unconscionableness of the bargain is ‘not the first thing to be considered The first thing to be considered isthe relations of these parties + Were they such as to put one in a postion ‘to dominate the will of the other? Having ‘this distinction and order in view the ‘authorities appear to their Lordshipsto be easly property interpreted” The borrower, in this case failed to prove that the lender was in a position to dominate his il. The only relation that was proved was that of the lender and the borrower. So, it was not proved whether lender was in a position to ‘dominate the will of the borrower and therefore, the borrower got no relief. The first requirement of Section 16 was not fulfilled Raghunath Prasad v. Sarju Prasad ‘twill be noted that the High Court did not cometo afinding that Balaram was in a position to dominate the wil of his father {Subhas his son being only about 14 years of ‘age atthe date of the deed of gift) Nor did the High Court find that the transaction was an unconscionable one The result is that the appeals allowed, ‘the judgment and decree of the High Court set aside and that ofthe trial Court restored.inthe suit + Ganga Prasad had no son + The suit out of which the appeal has arisen was instituted in the name ‘of Narasimha Bhatta who was stated ‘tobe of weak intellect by his next friend and daughter Adithiamma + By this deed of settlement the entire properties which were considerable were given to respondent No. 1, the plaintiff reserving only aie interest or himself besides making some provision for the maintenance of his wife Lakshmiamma + Respondent No. 1 was able to obtain benefits under the settlement deed for himself owing to the weak intellect and ‘old age ofthe plaintf. The petitioner, who owned 48 kanals 111 matlas of agricuttural land in Village Panjetha, Tehsil and District Patiala, entered into a contract for sale ofthat land with the respondent on 0-5-1988 @ Rs24,000 per acre. ‘ Atthe time of the execution of the ‘agreement, an amount of RS77,000 ‘was paid to the petitioner as earnest ‘money ‘Since the petitioner did not execute ‘the sale deed in favour of the ‘respondent in terms of the agreement ‘although the respondent was ready ‘and willing to perform his part of the contract, the latter, namely, the ‘respondent filed the suit for specific performance against the petitioner which was decreed by the trial court + Satyabrata Ghose V. Mugneeram bbangur & Co. AIR1954 SC 44 GGherulal Parakh v. Mahadeodas Maiya, AIR 1959 SC 781 The appellant, Gherulal Parakh Trial court ‘It was held that the plaintiff was a person of weak intellect and was not in a position ‘to take care of himself and manage his affairs properly on the date of the execution of the aforesaid documents The High Court ‘+ Reversed the judgment of the Court below holding that the git contained in Ex 8-3 was a spontaneous act of the plaintiff and he had exercised an independent will in ‘the matter of its execution Trial court ‘The decree was modified in appeal by the Additional Distirct Judge who was of the opinion ‘that the parties to the agreement, namely, the petitioner and respondent both suffered from a ‘mistake of fact as to the area of the land which ‘was proposed to be sold as also the price (sale ‘onsideration) whether it was to be paid at the ‘ate of per—bighal or per —kanall, ‘The lower appeliate court also found that the ‘respondent was not ready and wiling to perform his part of the contract * Consequenty, the decree for specific performance was not passed but a decree for ‘refund ofthe earnest money of Rs 77,000 was passed against the petitioner. This was upheld by the High Court Appellant ‘There was a stipulation in the agreement. ‘that ifthe respondent failed to pay the balance amount of sale consideration, the earnest money shall stand forfeited Judgement ‘*The dispositions which were made by Ex 6-3, as already pointed out before, were altogether unnatural and no valid reason or explanation hhas been given why Narasimha Bhatta should hhave given everything to respondent No. 1 and ‘even deprived himself of the right to deal with ‘the property as an owner during his lifetime. “*Allthese facts and circumstances raised @ grave suspicion asto the genuineness of the ‘execution of the document Ex B-3 and it was for respondent No. 1 to dispel the same In our opinion he has entirely failed to do so with the result that the appeal must succeed and its, allowed with costs in this Court Judgement *+ But, 25 pointed out above, we are dealing only with a matter in which one party had received an advantage under an agreement which was — in such cases the burden of proof would be (on party contends that the stipulation ‘amount isnot reasonable * in Union of india v Rampur Distellery the Court states the forfeiture clause can be construed either as iquidated damages or ‘asa penalty, depending on the reasonableness of the amount to be forfeited * Liquidated Damages should be regardedIn addition to the construction ‘works stipulated under the contract, plaintiff did some more ince the officers making such requests were unauthorized by the government to do so, hence, there was neither any agreement between the ‘construction work as requested by parties nor the rule of Promissory Estoppel could ‘mn officer of State of W.B. * Government though started using ‘the constructed warehouse, yet ‘on account of the work not being recorded in form of contract as provided under Article 299 of Constitution, denied any ibility topayforit ISSUES: * Whether there was any contract between theState of W.B, and plaincitr2 * Whether the rule of Promissory Estoppel can be evoked? * Whether plaintiff can claim under ‘5.70 of Indian Contract Act (ICA)? be invoked (Motial Padampat Sugar Mills) © First, person should lawfully do something for another person or deliver something to him; ‘Second, in doing so, he must not intend to act gratuitousty; ‘Third, other person for whom something is done or to whom something is delivered must ‘Voluntarily enjoy the benefit thereof Such other person must have the ‘option not to accept the thing and to return it he person must not be incompetent to exercise his volition usa * Further, “lawfully” w/s70 must be read in ‘accordance with S23 of ICA In alternative ‘o“itindicates that after something is, done or delivered by one person to other who enjoys the benefit there from, alawful relation is borne which Uu/s70 gives rise toa claim for compensation’ AMINOR cannot be sued for compensation u/s70 of ICA: Incidentally, minor is excluded from $70 for his case is specifically deat with u/s68 in same chapter; Secondly, voluntary acceptance of benefit of work done or thing delivered which isthe foundation or any claim u/s70 will not be present for he is incompetent to exercise his volition u/s11 * Petitioner participate in the = ‘auction organised by respondent no. 2 and 3, * Petitioner's bid was accepted by ‘the respondents for 4000 metric ‘tons at Rs 1,625/- per metrictons ‘from Dobari Collary ‘as reasonable compensation, while penalties should not * in case of penalty damages will have to be proved "no compensation at al be awarded ifthe court concludes that no los is likely to occur because of the breach + After the plintif constructed the Warehouse it was open to the State of W.B to havethe beneft oft orto demolish it and instruct the plaintiff to ‘take the materials used therein. “The government, by voluntarily enjoving the benefit accruing from the constructed ‘warehouses, became liable u/570 “However, tis urged by the defendant ‘that allowing this cause of action would amount to enforcing a contract in infringement of mandatory provisions of ‘A299 of the constitution, rendering it invalid * But, the contention is not well founded {or the plant did not allege any contract, stall while claiming u/s70. A299 may forbid a government to take work under a contract rendered invalid on ‘account ofits not being in compliance with itsterms, but does not make it unlawful for the government to take the benefit of work done for it under no contract at al " Request made by the officers not ‘authorized on behaif of government was not arequest at all and did amount to nothing 1 Whether cancellation of e-auction in favor of the petitioner justified? No. "Third party could not bid the contract due ‘to technical flaws- But court contended ‘that third party was not present before ‘the court - cancellation after the belated stage is against the natural justice 2. Whether jurisdiction of High Court under* Letter of acceptance was sent on 19/07/2005 via email to petitioner. A sum of rupees8112 Lakhs was deposited by petitioner ‘through cheque in favor of respondent no. 3 which was ‘accepted and encased by respondent, * Subsequently, an e-mail was sent by respondent na. 4 on 10/08/2005 stating that the sale ‘as well as auction in favour of petitioner stand cancelled ‘due to some technical and unavoidable ireumstances. "This communication was challenged by the petitioner. *Trimex offered, via an email, the ‘supply of bauxite to VAL which, after several exchanges of emails, ‘was subsequently accepted by latter, confirming the supply of 5 shipments of bauxite from Australia to India Though a draft ‘contract had also been prepared but it yet needed to be formalised "After VAL received first consignments of goods, it requested Trimex to hold back ‘next consignment of goods so as ‘to enable them to check bauxite’s utility value * However, on same day, ship ‘owners nominated the ship for loading the cargo. * Later when contract was cancelled by Trimex, it claimed damages paid to ship owners from VAL Which latter refused by denying ‘any contract, ISSUES: Whether there was any valid subsisting contract between the parties in absence of any formal contract? Article 226 can be ousted by exclusion clause in ‘agreement? No "the power of judicial review given to the High Courts by Article 226 of the Constitution of India, 1950, and being a basic feature of the Constitution, cannot be curtailed even by statute. “the ouster clauses can oust aterrtorial jurisdiction only of Civil Courts and not of the igh Court in respect of the power under Article 225 of the Constitution OF India, 1950, provided such power existsin the High Court on account of part of cause of action having arisen within its territorial jurisdiction” HELD: * once the contract is concluded orally or in \writing, the mere fact that aformal contract has not been prepared by the Patties doesnot affect either the acceptance of the contract so entered into or implementation thereof, * A contracts said to be concluded when parties agree as to the ‘essential terms’ of ‘the contract though minor details can be left over for them to decide later, abet subject to satisfaction of other requirements as provided by 5.10: without such essential terms being decided, contract cannot be enforced by law as itis deemed to be incomplete ‘TheSC held that al essential ingredients required for enforcing these kinds of, shipment contracts were decided by parties including price, quantity, product specifications, delivery and payment ‘terms, discharge port, shipment lots, demurrage rate, quality benchmark, applicable arbitration laws, etc Further, ‘minute to minute correspondences ‘exchanged b/w the parties clearly show ‘that both the parties were clearly aware of the various terms of the contract and were ad idem (5.13) w.rt those * Communication of acceptance, according t0S4, was complete as against VAL, as ‘and when confirmation of 5 shipment lots ‘came to the knowledge of Trimex Further, the acceptance was unconditional and unqualified (6.7): "We confirm the deal for5 shipments”.