2. Contract
Section 2(b) defines promise in these words
” when the person to whom the proposal is made
signifies his assent thereto, the proposal is said
to be accepted. Proposal when accepted ,
becomes a promise.”
Section 2(e) defines agreement as “every
promise & every set of promises, forming the
consideration for each other.”
Section 2(h) of the act defines the term contract
“as an agreement enforceable by law.”
3. Essential elements of a
valid contract
Proposal and acceptance
Consideration-lawful consideration with a lawful object
Capacity of parties to contract-competent parties
Free consent
An agreement must not be expressly declared to be void
Writing and registration, is so required by law
Legal relationship
Certainty
Possibility of performance
Enforceable by law
4. Void contract
It is a contract without any legal effect and
cannot be enforced in a court of law.
Section 2(j) defines a void contract as “a contract
which ceases to be enforceable by law becomes
void when it ceases to be enforceable”
Eg- Agreement in restraint of marriage
Agreement in restraint of trade
5. Contingent contract
The contingent contract is all about happening or not happening
of some future uncertain event .
Rules
Contingent contract depends on the happening of an uncertain
future event , cannot be forced until the event has happened
If a contingent contract depends for its performance on doing of
act by the promissory, the contract becomes void where the
promissory makes the performance impossible
If a contingent contract contemplates doing of a thing in a
specified event ,happens within a fixed time .It becomes void if
the event does not happen within the time.
If a contingent contract contemplates to do anything if an
impossible event happens, it is void.
6. Unlawful/Illegal contract
It is a contract which the law forbids to be
made.The court will not only enforce such a
contract but also connected contracts.All
illegal agreements are void but all void
contracts are not necessarily illegal.
E.g:
Contract to commit crime
Contract to destroy public property
7. Uncertain agreement
According to Sec 29 “agreements, the
meaning of which is not certain, or capable of
being made certain, are void.”
Through this sec the law aims to ensure that
the parties to a contract should be aware of
the precise nature and scope of their natural
rights and obligations under the contract.
8. Wagering Agreement
It is an agreement involving payment of a
sum of money upon the determination of an
uncertain event.
The essence of a wager is that each side
should stand to win or lose, depending on the
way an uncertain event takes place.
9. Bibliography
Mercantile law- CPT-ICAI
Business law for management-
K.R.BULCHANDANI
Element of mercantile law- N.D.KAPOOR
