CONTRACT (1872)

Sec 2(h): “An agreement enforceable by law”

AGREEMENT : Sec 2(e)

PROMISE : Sec 2(b)

Agreement (Accepted Proposal)

Offer/ Acceptance of
Proposal that Offer
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 What Agreement are Contract?
nt
m e Legal
r e e
Obligation
Ag

CONTRACT

Contract Act is the law of those agreement

which create legal obligation.
 Some agreement are not Enforceable.
 What obligations are Contractual in nature.
 Agreement to do unlawful, immoral or illegal Act.
 Agreement is broader term than Contract.
 Law of contract creats rights
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PGDM II 2
 Essential Elements of a valid Contract (Sec 10)

1. Agreement (Consensus-ad-idem)
2. Intention to create legal relationship
3. Free & Genuine Consent
4. Parties competent to contract
5. Lawful Consideration
6. Lawful object
7. Agreement not declared illegal or void
8. Certainty of meaning
9. Possibility of Performance
10. Necessary legal formalities
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 Classification of Contract
1. According to validity of Enforceability
a) Valid contract
b) Voidable contract
c) Void contract
d) Illegal contract
e) Unenforceable contract
2. According to mode of Formation
a) Express contract
b) Implied contract
c) Quasi contract
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 Classification of Contract (Cont’d)
3. According to Performance
a) Executed contract
b) Executory contract
c) Unilateral contract
d) Bilateral contract

IGNORATIA
“Non Juris Execusat”
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Offer & Acceptance

Sec. 3 to 9 of ICA,1872
• When one person signifies to another his
willingness to do or to abstain from doing
anything, with a view to obtaining the assent
of that other to such act or absistence, he is
said to make proposal.
• The offeror or proposer expresses his
willingness to do or not to do something with
a view to obtain acceptance of the other party
to such act or absistence.
Offer / Proposal:

1.Positive1
2.Negative2
 How an offer is made:

a)Any Act:
i.) By words [written,Oral] 3,4

ii) By conduct5

b) By Omission 6
 Implied Offer 7

Specific & General Offer8,9

Essential requirements of a valid offer:
• Offer must be made with a view to obtain
acceptance.
• Offer must be made with the intention to create
legal relations.
• Terms of offer must be definite,unambiguous &
certain or capable of being made certain.The term of
offer must not be loose,vague or ambiguous.10,11
• Offer must be distinguished from:(a) a
mere declaration of intention or (b) an
invitation to offer.12,13

• The offer must be communicated to

offeree.14

• The offer must not contain a term the non-

compliance of which may be assumed to
amount to acceptance.14
• A tender is an offer as it is in response to an
invitation to offer. (a)Specific15 or definite
(b)Standing16

• Special terms in offer must be duly brought

to the notice of the offeree at the time the
offer is made.17

• Two identical cross-offers do not make a

contract.18
 Cross Offer
Y
X

Y
X
 Termination or Lapse of Offer:
• The offer lapses after stipulated or reasonable
time.19
• An offer lapses by the death or insanity of the
offeror or offeree.
• An offer terminates when rejected by the
offeree.
• An offer terminates when revoked by the
offeror before acceptance.
• An offer terminates by not being accepted
in the mode prescribed or if no mode is
prescribed in some usual & reasonable
manner.

• A conditional offer terminates when

conditions is not accepted by the offeree.20

• It terminates by counter offer by the

offeree.
 Acceptance
Acceptance how made:
Offeree

Assent to proposal

Acceptance
 Assent

Expressed Implied

writing Word of mouth

Surrounding circumstances
Or the conduct of the parties.2

By performance of some
Required act.1