University of Co-operative and Management, Thanlyin

Certificate in Entrepreneurship and Business Management

Business Law

Daw Nan Thin Thiri Myat Thu

Lecturer
Department of Law
-to understand the general principles of the law of contract

-to realize what is contract and how contract are formed.

-to know key elements of contract.

- to apply the law of Contract in economic field

❖ its origin to Latin term “contractum”.

❖ it is of vital importance in business life and the basic of

commercial transactions.
❖ constitutes the most important branch of the commercial law
and very foundation of the modern civilized world.
❖ the applicable law of Contract in Myanmar is the Indian
Contract Act came into being in September 1872.
❖ a contract is like a promise between people.
o Sir William Anson as a ‘Legally binding agreement between two or

more persons by which rights are acquired by one or more to acts or

forbearances on the part of the others’.

o Salmond said ‘Contract is an agreement creating and defining

obligations between parties’.

o a contract is a legally enforceable agreement that creates, defines,

and governs mutual rights and obligations among its parties.

o according to Section 2(h) of the Indian Contract Act, 1872, An

agreement enforceable by law is a contract.

-when one person signifies to another his willingness to do or to abstain from doing
anything, with a view to obtain the assent of that other to such or abstinence, he is
said to make a “Proposal”, Section 2(h) of the Contract Act.

-an offer is an expression of willingness to contract on specified terms, made with

the intention that it is to be binding once accepted by the person to whom it is
addressed.

-an offer can be addressed to a single person, to a specified group of persons, or to

the world at large.

-the first requirement of a legally binding agreement is that there is an offer.

✓ according to Section 2(b) of the India Contract
Act, When the person to whom the proposal is
made signifies his assent thereto, the proposal
is said to be “Acceptance”. A proposal when
acceptance become promise.
✓ acceptance is a necessary element of a legally
binding contract.
✓ Sir Wllian Anson compares the offer to a train
of gun powder and the acceptance to a lighted
match.
❖ a proposal, when accepted become promise.

Section 2(b) of the Contract Act.

❖ the person making the proposal is called the

“promisor” and the person accepting the proposal

is called the “promise”, section 2(c) of the
Contract Act.

❖ there must be a minimum of two persons to a

promise.

❖ an offer does not create any legal obligations, but

after the offer is accepted it becomes a promise.

 Agreement=proposal(offer)+acceptance

❑ an agreement is formed when an offer is acceptance.

❑ agreement can be said to be very basic of a contract.

❑ every promise and every set of promises, forming the consideration for each
other, is an “Agreement” section 2(e) of the Contract Act.
❑ an agreement is a promise between two entities creating mutual obligations
by law.
❑ two persons should agree about the subject matter of the agreement in the
same sense and the same time.
❑ it is a meeting of the minds in a common intention, and is made through
offer and acceptance.
is an agreement between two or more parties.

is legally binding

can be written, spoken or by the conduct of the parties.

has terms and conditions.

the obligation must relate to definite act or acts.

the obligation must relate to legal matters and not social or domestic
affairs.
consideration in the sense of quid pro quo = something in return.
an agreement to be enforceable, it must be supported by
consideration which is the foundation of every contract.
consideration is “ it is the price of a promise.”
according to section 2(h) of the Contract Act, when at the desire of
the promisor, the promise or any other persons has done or abstained
from doing or does or abstains from doing or promises to do or to
abstain from doing, something, such act or abstinence or promise is
called consideration for the promise.
consideration on the part of every person or company that enters the
contract.
in order to create a legally valid contract, the parties will need to
exchange something of value.
consideration is the benefit a party gets for entering a contract.
A agrees to sell his car to B for Rs. 100,000. B’s promise to pay the
sum of Rs. 100,000 is the consideration for A’s promise to sell the car,
and A’s promise to sell the car is the consideration for B’s promise to
pay the Rs. 100,000.