Void Agreements

An agreement not enforceable by law is void. A void agreement doe not give rise to any legal consequences and is void ab-initio. Agreement with a minor, agreement without consideration are void agreements.

Following agreements are expressly declared to be void: 1.) Agreement in restraint of marriage. 2.) Agreement in restraint of trade. 3.) Agreement in restraint of legal proceedings. 4.) Agreement the meaning of which is uncertain. 5.) Agreement by way of wager. 6.) Agreement contingent on impossible event. 7.) Agreement to do impossible acts.

CONTINGENT CONTRACT: A Contingent contract is a contract to do or not to do something, if some event, collateral to such contract does or does not happen. Thus it is a contract which is dependant on the happening or non happening of a certain event. Examples: a.) A contracts to sell 10 bales of cotton for Rs. 20,000 if the ship by which they are coming returns safely.

b.) A promises to pay Rs. 50,000 to B if he is elected the President of a particular association. c.) C advances a loan of Rs. 10,000 to D and M promises to C that if D does not repay the loan, M will do so. d.) A promises to pay Rs. 50,000 to B if a certain cargo ship does not return.

QUASI CONTRACTS: In some cases, there is no offer, no acceptance, no agreement and no intention on the part of the parties to enter into a contract but still law, from the conduct and relationship of the parties, implies a promise imposing obligation on one party and conferring a right on the other. In other words, under certain special circumstances, obligations resembling those created by a contract are imposed by law although the parties never intended to enter into a contract.

Certain examples: •A supplies B, a lunatic, with necessaries suitable to his condition of life. A is entitled to be reimbursed from B’s property. •When a coolie takes the luggage at the railway station without being asked by the passenger or a shoe- shiner starts shining shoes of a person without being asked to do so, and if the person doesn’t object to that, then he is bound to pay reasonably for the same work.

•A fruit parcel is delivered under a mistake to R who consumes the fruit thinking them as birthday present. R must return the parcel or pay for the fruits. Although there is no agreement between R and the true owner, yet he is bound to pay as the law regards it as a quasi contract. • A pays some money to B by mistake. It is really due to C. B must refund the money to A.

REMEDIES FOR BREACH OF CONTRACT: A.) RECISSION OF THE CONTRACT: When there is a breach of contract by one party, the other party may rescind the contract and need not perform his part of the contract. On the other hand, if he intends to sue the guilty party for damages, he has to file a suit for the rescission of the contract. When the court grants rescission, the aggrieved party is free from all duties under the contract and becomes entitled to compensation under the contract.

For ex: A contracts to supply 100 Kgs of rice for Rs. 4000 to B. If A does not supply the rice then B does not have to pay the price. B may treat the contract as rescinded and may sit quietly or he may also file a suit for rescission and claim damages.

B.) SUIT FOR DAMAGES: A suit for rescission is accompanied by a suit for damages i.e., in the same plaint. Damages are a monetary compensation allowed to the injured party for the loss he has suffered as a result of the breach of the contract.

C.) SUIT UPON QUANTUM MERIT: The phrase ‘Quantum Merit’ means ‘as much as is earned’ or in ‘proportion to the work done’. A right to sue upon quantum merit usually arises where after part-performance by one party, there is a breach of contract. For ex: A engages B, a contractor, to build a three storied house. After a part is constructed, A prevents B from working anymore. B, the contractor, is entitled to get reasonable compensation for work done under the doctrine of quantum merit in addition to the damages for breach of contract.

D.) SUIT FOR SPECIFIC PERFORMANCE: Specific performance means the actual carrying out of the contract as agreed. Under certain circumstances, an aggrieved party may file a suit for specific performance i.e., for an order by the court directing the defendants to actually perform the promise that has been made.

E.) SUIT FOR AN INJUNCTION: Injunction is an order of the court restraining a person from doing a particular act. For example: A agreed to sing at B’s theatre for three months and to sing for no one else during that period. Subsequently, she contracted to sing at C’s theatre and refused to sing at B’s theatre. On a suit by B, the court granted an injunction restraining A from singing elsewhere and awarded damages to B for the loss suffered by him.

NOVATION AND RESCISSION OF CONTRACT:

Discharge of contract by mutual agreement between the parties: NOVATION: Novation means when a new contract is substituted for an existing contract. When the parties to a contract agree for novation, the contract is discharged and need not be performed. For example: A owes Rs.10000 to B and B owes Rs. 10000 to C. By mutual agreement, B’s debt to C and A’s debt to B are cancelled and C accepts A as his debtor. This is known as novation. A owes B Rs. 10,000. A enters into an agreement with B and gives B a mortgage of his(A’s) estate for Rs. 5000 in place of the debt of Rs. 10000. This is a new contract and extinguishes the old contract.

RESCISSION: A contract may be discharged before the date of performance by agreement between the parties. Such an agreement amounts to rescission or cancellation of the contract. An agreement of rescission releases the parties from their obligations arising out of the contract. For Example: A promises to deliver certain goods to B on a certain date. Before the date of performance, A and B mutually agree that the contract will not be performed. The contract stands discharged by rescission.

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