Definition of Law

Law has been defined as rules of human action.

Sir John Salmond defined law as the body of

principles recognized and applied by the state for the administration of justice.
According to Holland T.E law is a rule of the

external human action enforced by a sovereign political authority

IMPORTANT ELEMENTS OF LAW

1. LAW IS A BODY OF RULES 2. LAW IS FOR THE GUIDANCE/CONDUCT OF
3. 4. 5.

6.

PERSONS LAW IS IMPOSED LAW IS ENFORCED BY THE SOVEREIGN LAW IS OPERATED WITHIN A SPECIFIC AREA OR STATE LAW IS MADE TO SERVE SOME PURPOSE WHICH MAY BE SOCIAL,ECONOMIC OR POLITICAL

CLASSIFICATION OF LAW BY HOLLAND

1.
2. 3.

4.
5.

PRIVATE LAW AND PUBLIC LAW CIVIL LAW AND CRIMINAL LAW NATIONAL AND INTERNATIONAL LAW STATUTE AND COMMON LAW GENERAL AND SPECIAL LAW

LEGISLATION JUDICIAL PRECEDENTS

1.AUTHORITATIVE&PERSUASIVE 2.ORIGINAL&DECLARATIVE

CUSTOMS
CONVENTIONS

PRINCIPLES OF NATURAL JUSTICE

RULES AGAINST BIAS HEAR THE OTHER SIDE REASONED DECISION OR SPEAKING ORDER

RULES AGAINST BIAS 1.He has a pecuniary interest in the subject matter of the dispute 2.He is a relative or friend or enemy of any of the disputing parties 3.He has general interest in the subject matter HEAR THE OTHER SIDE: 1.Notice 2.opportunity of hearing

Four stages of development of law

Devine law(themes)
Customary law Priestly class (as interpreter&custodians)

Codification

STATE
State is an association of human beings whose

members are considerably united with the appearance of permanence for political ends, for the achievement of governmental institutions REQUISITES OF A STATE:
1. POPULATION

2.DEFINED TERRITORY 3.GOVERNMENT

4.SOVEREIGNTY

FUNCTIONS OF THE STATE

1.PRIMARY FUNCTIONS
2.SECONDARY FUNCTIONS

CLASSIFICATION OF STATES
1.UNITARY 2.FEDERAL
CHARACTERISTICS OF A FEDERAL STATE
1.FEDERAL GOVT./CONSTITUTION 2.DIVISION OF SOVEREIGN POWER 3.RIGIDITY OF CONSTITUTION 4.SUPREMACY OF THE JUDICIARY

CONSTITUTION OF INDIA
Indian constitution adopted by the Constituent Assembly on 26Nov.1949 and came into force from 26 January,1950 is a comprehensive document containing 395Articles and 12 schedules

PREAMBLE: We the people of India having solemnly resolved to

constitute India into a sovereign socialist secular democratic republic and to secure to all its citizens JUSTICE social,economic and political LIBERTY of thought,expression,belief,faith and worship, EQUALITY of status and opportunity and to promote among them all FRATERNITY assuring the dignity of the individual and the unity and integrity of the nation
In our constituent assembly this 26th day of November 1949 do hereby Adopt,Enact and give to ourselves this constitution

Salient features of Indian Constitution

1.
2. 3. 4. 5. 6.

7.
8. 9.

POPULAR SOVEREIGNTY FEDERALISM SINGLE CITIZENSHIP FUNDAMENTAL RIGHT DISTRIBUTION OF POWERS IN THE LEGISLATIVE LIST EMERGENCY PROVISIONS DIRECTIVE PRINCIPLES OF STATE POLICY SECULARISM INTEGRATED JUDICIARY

Fundamental Rights(part-3:Art.14to35)
1.RIGHT TO EQUALITY(Article 14-18) 2.RIGHT TO FREEDOM(Art.19-22) a)Freedom of speech and expression b)Freedom to assemble peacefully c)Freedom to form Associations or Unions d)Freedom to move freely throughout India e)Freedom to reside and settle in anywhere in India f)Freedom to practice any profession or to carry on any occupation ,trade or business 3.RIGHT AGAINST EXPLOITATION(Art.23-24) 4.RIGHT TO FREEDOM OF RELIGION(Art.25-28) 5.CULTURAL & EDUCATIONAL RIGHTS(Art.29-30) 6.RIGHT TO PROPERTY (Art.31) 7.RIGHT TO CONSTITUTIONAL REMEDIES(Art.32-35)

Directive principles of state policy

(part IV Art.36 to 51)
Influenced by the Irish constitution which itself was

influenced by the constitution of Spain. It is an instrument of instructions to the future govts. These 16 Articles from 36 to 51 covers a wide range of state activity embracing economic, social, legal, educational and international problems.

Fundamental Duties
The 42nd Amendment of the constitution added a new

part to the constitution, Part IV A incorporating ten fundamental duties of the citizen under Article 51A.

Fundamental Duties
1.
2. 3. 4. 5. 6. 7. 8. 9. 10.

To abide by the constitution and respect its ideals and institutions, the National Flag and the National Anthem; To cherish and follow the noble ideas which inspired our national struggle for freedom; to uphold and protect the sovereignty, unity and integrity of India. to defend the country and under national service when call upon to do so; to promote harmony and the spirit of common brotherhood among all the people of India. to value and preserve the rich heritage of our composite culture; to protect and improve the natural environment to develop the scientific temper humanism and the spirit of enquiry and reform; to safeguard public property and abjure violence to strive towards excellence in all spheres of individual and collective activity, so that the nation constantly rises to higher levels of endeavour and achievement

THE UNION EXECUTIVE

THE PRESIDENT:-Since India is a Republic, the

constitution provides for a President of India and the executive powers of the Union Govt. including the supreme command of the defense forces is vested in him. Any citizen of India who has completed the age of 35 years and qualified to be elected as a member of the Lok sabha is eligible to be elected as the President.

THE PRESIDENT
ELECTION:-The President is elected for a period of 5

years by an electoral college composed of-1)elected members of Parliament and 2)elected members of the state Legislative Assemblies. The election is held in accordance with the system of proportional representation by means of the single transferable vote as per the election statute The Presidential and Vice-Presidential Elections Act,1952. Presidents office becomes vacant in 3 ways: 1.death,2.resignation or 3. removal by impeachment

THE PRESIDENT
POWERS :-Under Article 53 of the constitution the

executive powers of the Union is vested in the President.These powers may be broadly classified into Executive powers,Legislative powers and Emergency powers.

EXECUTIVE POWERS OF PRESIDENT

As the head of the Union Executive the executive powers of the

President embraces the entire activities of the Union. He is the commander-in-chief of the Defense Forces. He appoints the Prime Minister and other Council of Ministers.
He appoints the Attorney-General, the Chief Justice and Justices

of the Supreme Court and those of the High Courts,the members of the UPSC,the Election Commission,the Comptroller and Auditor-General of India,Ambassadors and other diplomatic representatives of India,Commissioner of the scheduled castes,tribes,backward classes and Minorities,the Governors, chief Commissioners of UT,Members of the Finance Commission,etc.

Under Article 72 the President is given the power to grant pardon.

LEGISLATIVE POWERS OF THE PRESIDENT

The President forms an integral part of the legislative process as without

his assent no Central Bill can become law. He summons the House of Parliament,prorogues the Houses or and dissolve the house of the People. He may address either House of the Parliament or both the Houses assembled together. He nominates 12 members to the Council of States and 2 members of the Anglo-Indian community to the House of People. Every Bill passed by the Parliament must be presented to the President for his assent. He causes to be laid before the Parliament the annual budget showing the estimated receipts and expenditure of the Union for each year. No demand for a financial grant can be made in Parliament except on his recommendation. Under Article 123 the President is empowered to promulgate Ordinances which has the same effect as an Act of Parliament.

EMERGENCY POWERS OF PRESIDENT

The President is empowered to declare three

different types of Emergencies. He may declare an emergency either in any part or the whole of India, if he is satisfied that there is a threat of war or external aggression or internal disturbance. He may declare an emergency in case of a breakdown of the constitutional machinery in any state of the Union. He may declare a Financial Emergency in the country in case of financial breakdown.

EMERGENCY PROVISIONS
A. WAR EMERGENCY(Art.352) EFFECT OF THE PROCLAMATION(Art.353,354) B. CONSTITUTIONAL EMERGENCY IN THE STATES(Art.356) SUSPENSION OF FUNDAMENTAL RIGHTS(Art.358,359) C. FINANCIAL EMERGENCY(Art.360)

THE UNION EXECUTIVE: THE COUNCIL OF MINISTERS

Under Article 53(1) of our constitution, the

executive power of the Union is vested in the President but under Article 75 there is to be a Council of Ministers with the PM as the head to aid and advise the President in the exercise of his functions. The president is thus made a formal or constitutional head of the executive and the real executive powers are vested in the Cabinet

THE COUNCIL OF MINISTERS & THE PM

The PM is a connecting link between the Cabinet

and the President on the one hand, and also between the Cabinet and the Parliament on the other. This spl. Position that he enjoys both in the govt. and in Parliament makes his office the most important under the Constitution of India. The long list of powers that are vested in the President are exercised in reality by the PM.

COUNCIL OF MINISTERS AND THE CABINET

The Council of Ministers consists of all the

different categories of ministers Cabinet ministers,Ministers of State and Deputy ministers.Of these, the Cabinet ministers form a separate body called Cabinet, which in fact is the nucleus of the council of ministers. The constitutional responsibility of advising the President is the council of ministers.But this function today is exercised exclusively by the Cabinet.

INDIAN JUDICIARY- Supreme Court

India has a single judicial system The Supreme Court of India is an all-India supreme

appellate court having both criminal and civil jurisdictions. The Supreme Court got extensive powers of reviewing the decisions of the courts below it in criminal and civil cases. It is the highest interpreter of the constitution and a tribunal for the final determination of disputes between the Union and the states. The supreme court is the protector of the Fundamental Rights of the citizens. The Supreme court gives its advise to the President of India on questions of law and fact. contd

SUPREME COURT
The supreme court consists of the Chief Justice and 25

other judges. Every judge of the Supreme Court is appointed by the President of India. Qualifications 1)citizen of India 2)has been a Judge of a High Court at least for five years 3)has been an advocate of a High Court for at least ten years 4)a distinguished jurist. Supreme Court judges hold office up to the age of 65 years. After retirement a Judge of the supreme court is prohibited from practicing law before any court in India. A judge of the supreme court can be removed from office only on the ground of misbehaviour or incapacity. All the decisions of the judges in their official capacity are immune from criticism.

JURISDICTION OF THE SUPREME COURT

The jurisdiction of the court can be divided into three categoriesORIGINAL APPELLATE ADVISORY

1. 2. 3.

ORIGINAL JURISDICTION(Art.131)

ANY DISPUTES 1. Between the govt. of India and any state/states 2. Between the govt. of India and any state/states on one side and one or more other states on the other 3. Between two or more states.

APPELLATE JURISDICTION(Art.132-136)
Article132 provides that an appeal shall lie to the supreme court from any judgement,decree or final order of a HC in the territory of India,whether in a civil,criminal or other proceedings,if the HC certifies that the case involves a substantial question of law as to the interpretation of the constitution. There are 3 circumstances under which criminal appeals to the SC will be permitted: that is, if a HC 1)on appeal reversed an order of acquittal of an accused person and sentenced him to death; or 2)withdrawn for trial before itself any case from any court subordinate to its authority and in such trial convicted the accused person and sentenced him to death; or 3) certifies that the case is a fit one for appeal to the SC.
Article 136 states that notwithstanding anything in this chapter, the SC may,in its discretion,grant special leave to appeal from any judgement,decree,determination,sentence or order in any case or matter passed or made by any court or tribunal in the territory of India.

ADVISORY ROLE OF SUPREME COURT

ARTICLE 143: If at any time it appears to the

President that a question of law or facts has arisen or is likely to arise which is of such nature and of such public importance that its expedient to obtain the opinion of the SC upon it,he may refer the question to that court for consultation,and the court may, after such hearing as it thinks fit, report to the President its opinion thereon

JUDICIARY IN THE STATES-1

EVERY STATE HAS A HIGH COURT OPERATING WITHIN ITS TERRITORIAL JURISDICTION AND EVERY HC IS A COURT OF RECORD. NEITHER THE STATE EXECUTIVE NOR THE STATE LEGISLATURE HAS ANY POWER TO CONTROL THE HC OR TO ALTER THE CONSTITUTION OR ORGANISATION OF THE HC. EVERY JUDGE OF THE HC IS APPOINTED BY THE PRESIDENT OF INDIA. APART FROM THE NORMAL ORIGINAL AND APPELLATE JURISDICTION,THE CONSTITUTION VESTS FOUR ADDITIONAL POWERS TO THE HC.

1)The power to issue writs or orders for the enforcement of the fundamental rights (art.226). 2)the power of superintendence over all courts in the state (Art.227). 3)power to transfer cases to itself from subordinate courts concerning the interpretation of the constitution (Art.228). 4)power to appoint officers and servants of the HC.

Contd

JUDICIARY IN THE STATES-2

SUBORDINATE COURTS: The constitutional provisions dealing with the subordinate

courts are intended to secure a two-fold objective

First to provide for the appointment of District and Subordinate

Judges and their qualifications. Secondly to place whole of the civil judiciary under the control of the HC. -Judges to the District Courts are appointed by the Governor in consultation with the HC.
- Appointment of persons other than District Judges to the judicial service of a state is made by the Governor in accordance with the rules made by him and the state PSC.

THE STATE EXECUTIVE - GOVERNOR

The machinery of govt. in the states is organised on

the same pattern as that of the Union govt. The head of the state is called the Governor. The executive power of the state is vested in the Governor who is appointed by the president. Governor holds office for a period of 5 years.

POWERS & FUNCTIONS OF GOVERNOR

The executive power of the state is vested in the Governor. He appoints the CM and other ministers. All executive actions of the govt. are taken in his name. He is the integral part of the state legislature. He convenes the state legislature addresses it and prorogue or dissolve it. During every financial year,he causes the budget to be laid before the House. Every Bill that is passed by the state Legislature become law on his assent. He can promulgate Ordinances during the recess of the State Legislature. When the President proclaim Emergency in a state the Governor becomes the defacto ruler of the state.

STATE LEGISLATURE-1
The Constitution provides for a Legislature for

every State in the Union.It may be a bicameral or unicameral Legislature. Bicameral 1.Legislative Assembly 2.Legislative Council Unicameral 1.Legislative Assembly Art.169 provides for the creation or abolition of the Legislative Council. contd..

 LEGISLATIVE ASSEMBLY: 1.composed of members chosen by direct election

2.Governor can nominate 1 or 2 members of the AngloIndian community 3.Max. No.500 members and the Min. No. is 60 members. 4. Min.age of a member shall be 25 years. 5.Normal tenure of the assembly is five years; but can be dissolved earlier by the Governor. 6.Speaker & Deputy Speaker elected from the members conducts its business.

Contd.

 LEGISLATIVE COUNCIL: 1.Total No. of members should not exceed one-third of the

Legislative Assembly. 2. Min. No. is 40. 3.Members are elected indirectly from different categories of people and nominated by the Governor. 4.Min. age of a member shall be 30 years. 5.Chairman & vice-Chairman both elected by the Council conducts its business. The State Legislature should meet at least twice a year interval between two sessions should not be more than six months. of the Legislature.

Every Bill except Money Bills may be introduced in either House

INDIAN PARLIAMENT
Legislature of the Union is called Parliament It is a bi-cameral legislature The two Houses of Parliament are - House of the

People(the Lok Sabha) and the Council of States(the Rajya Sabha) House of the People is composed of directly elected representatives on the basis of adult franchise and territorial constituencies. Council of States is composed of representatives of the States elected by the State Assemblies. Art.79 says that the Parliament consists of President of India and the two Houses. contd

THE LOK SABHA: Commonly known as the Lower House. Members are elected directly by the people on the basis of adult franchise(18 yrs.) by secret ballot. No. of members is fixed by the constitution(42nd amendment Art.81-543+2 members) Normal term is 5 years The House should meet at least twice in a year gap between 2 meetings should not be more than 6 months. Meeting of the Lok Sabha is presided by the Speaker and by the Dy. Speaker in his absence. Each House of Parliament is have its own secretarial staff and the Lok Sabha Secretariat is headed by aSecretarygeneral who is a permanent officer

COUNCIL OF STATES: The upper house of parliament is also called the House of Elders Max. members are 250( present strength 245) Council of States is presided by Chairman or dy. Chairman. Vice-President of India is the ex-officio Chairman of the Council of States

LEGISLATIVE PROCEDURE
Law -making is the primary function of parliament.
The first stage of legislation is the introduction of a Bill in the House. Every Bill that is introduced in the House has to be published in the Gazette. Introduction of the Bill is also known as the first reading of the Bill. There are 4 alternative courses of action open at the second stage may be taken into consideration, may be referred to a select committee of the House, may be circulated to elicit public opinion on it. Submission of the report of the Committee is the beginning of the 3rd stage.During this stage Members can send their amendments. During the next stage detailed clause-by-clause discussion of the Bill begins. During the next stage(third reading) the member who has piloted it moves that the Bill be passed.Once all the amendments are disposed of,the Bill is passed and send to other House for its action. The other House may pass the Bill ,Amend it or return it. A Bill that is finally passed by both the Houses, goes with the signature of the Speaker, to the President for his assent

AMENDMENT OF THE CONSTITUTION

Indian constitution is neither too rigid nor too flexible. The procedure for amendment of the constitution is given in

Art.368. An amendment may be initiated only by the introduction of a Bill in either House of Parliament. When the Bill is passed in each House by a majority of the total membership of the House and by a majority of not less than twothirds of the members of that House present and voting. Then it is presented to the President for his assent.On the assent of the President the constitution stands amended. Certain provisions of the constitution can be amended by a twothird majority of parliament plus ratification by not less than50% of the states.(eg. Provisions dealing with the division of power between Union and states). 94th amendment was made in2006.

MERCANTILE/BUSINESS LAW
The term Mercantile/Business Law is used to denote the branch of law which is concerned with such matters that are usually the subject of mercantile or business transactions. DEVELOPMENT OF MARCANTILE LAW

LAW OF CONTRACT
OBJECT OF THE LAW OF CONTRACT: -Formulate the rules for binding agreements -Remedies and conditions for breach of contract

INDIAN CONTRACT ACT,1872

DEFINITIONS
AGREEMENT:-

Every promise and every set of promises forming consideration for each other[sec.2(e). Agreement=Offer+Acceptance CONTRACT:-An agreement enforceable by law is a contract[2(h). According to Anson, a contract is an agreement enforceable by law, made between two or more persons by which rights are acquired by one or more to acts done or forborne on the part of the other or others.It is that form of agreement which directly contemplates and creates an obligation

ESSENTIAL ELEMENTS OF A VALID CONTRACT

OFFER AND ACCEPTANCE 2. INTENTION TO CREATE LEGAL RELATIONSHIP 3. LAWFUL CONSIDERATION 4. COMPETENCY/CAPACITY OF THE PARTIES 5. FREE AND GENUINE CONSENT 6. LAWFUL OBJECT 7. AGREEMENT NOT DECLARED VOID 8. CERTAINTY AND POSSIBILITY OF PERFORMANCE 9. LEGAL FORMALITIES
1.

Nature of a contract
Law of contract creates jus in personam ( means right

against a person or thing) Law of contract is not a jus in rem (means right against the whole world) According to Salmond law of contract is not the whole law of agreements, nor is it the whole law of obligations. It is the law of those agreements which create obligations which have their sources in agreements.

Classification of Contracts
Contract

Validity

Formation

Performance

1.Valid 2.Void 3.Voidable 4.Unenforceable 5.Illegal

1.Expres 2.Implied 3.Quasi

1.Unilateral 2.Bilateral 3.Executed 4.Excecutor y

Difference between illegal contract and void contract

A contract which is prohibited by law or is against

public policy is illegal. Any contract not enforceable by law is void. Every illegal contract is a void contract. All void contracts are not illegal. All collateral contracts depending on an illegal contract are void. A void contract does not affect a collateral contract.

Difference between void agreement and void contract

An agreement not enforceable by law is a void

agreement. In the case of a void agreement, no contract comes into existence. But in the case of a void contract, a contract comes into existence but subsequently ceases to be enforceable by law. A void agreement does not give rise to a contract. An agreement which becomes illegal in the case of performance is a case of void contract while an agreement which is null and void ab-initio is a case of void agreement.

Difference between void agreement and voidable agreement

Void agreement cannot be enforced by anyone of the

parties thereto. A voidable agreement is void at the option of one of the parties thereto. A void agreement is void ab-initio. A voidable agreement does not become void unless the party at whose option it is voidable repudiates it. contd..

 A void agreement implies an agreement which does

not satisfy the requirements of section -10 . A voidable agreement implies a contract in which the consent of one of the parties is not free. The defects of a void agreement are incurable. The defect in the case of a voidable agreement is curable and may be condoned.

OFFER
An offer is a proposal by one party to another to enter

into a legally binding agreement with him.. An offer may be made by express words spoken or written. An offer may also be implied from the conduct of the parties. When an offer is made to a definite person, it is called a specific offer. It can be accepted only by the person to whom it is made. When an offer is made to the world at large, it is called a general offer.

LEGAL RULES AS TO OFFER

1. Offer must be such as in law as capable of being
2. 3. 4. 5. 6.

accepted and giving rise to legal relationship. Terms of offer must be definite. Offer must be communicated Offer must be made with a view to obtain the assent. A statement of price is not an offer. An offer may be distinguished from: a) a declaration of intention and an announcement.b)an invitation to make an offer to do business. contd

Legal rules as to offer

. 7. An offer may be made by express words spoken or written. 8. An offer may also be implied from the conduct of the parties. 9. When an offer is made to a definite person, it is called a specific offer. It can be accepted only by the person to whom it is made. IO.When an offer is made to the world at large, it is called a general offer.

Communication of Revocation (Sec.4(3))

The communication of an offer is complete when it

comes to the knowledge of the person to whom it is made [Sec. 4(1)]

The communication of an acceptance is complete

when it is put into a course of transmission to the proposer [Sec. 4(2)]

TENDERS A tender is an offer in response to an invitation to offer. It may be: (1) a definite offer to supply specified goods or services or (2) a standing offer.

LEGAL RULES AS TO ACCEPTANCE

1. It must be absolute and unqualified 2. It must be communicated to the Offeror. 3. It must be according to the mode prescribed or usual and reasonable mode 4. It must be given within a reasonable time 5. It cannot precede an offer 6. It must be given by the party or parties to whom the offer is made
7. It must be given before the offer lapses or before the offer is withdrawn 8. It cannot be implied from silence.

COMMUNICATION OF OFFER,ACCEPTANCE&REVOCATION
AN OFFER, ITS ACCEPTANCE AND THEIR REVOCATION TO BE COMPLETE MUST BE COMMUNICATED.

When the contracting parties are face to face and negotiate in person, a contract comes into existence the moment the offeree gives his absolute and unqualified acceptance to the proposal made by the Offeror. When the parties are at a distance and the offer and acceptance and their revocation are made through post ie. by letters or telegram, the rules contained in Sec. 3 to 5 apply.

Mode of Communication (Sec. 3):

Offer, acceptance or revocation may be communicated

by words spoken or written or by conduct. When is communications complete (Sec. 4) : The communication of an offer is complete when it comes to the knowledge of the person to whom it is made [Sec. 4(1)] The communication of an acceptance is complete when it is put into a course of transmission to the proposer [Sec. 4(2)]

Communication of Revocation [Sec. 4(3)]

The communication of revocation is complete: -as against the person, who makes it, when it is put into a course of transmission to the person, to whom it is made, so as to be out of the power of the person who make it.
-as against the person to whom it is made, when it comes to his knowledge.

CONSIDERATION
Consideration is a technical term used in the sense of

quid pro quo (something in return) When at the desire of the promisor, the promisee or any other person has done or abstained form doing or does or abstains form doing or promises to do or abstain from doing something. such act or abstinence or promise is called a consideration for the promise. [Sec. 2(d)].

LEGAL RULES AS TO CONSIDERATION

1.It must move at the desire of the promisor 2.It may move from the promisee or any other person. 3.It may be an act, abstinence or forbearance or a return promise 4.It may be part, present or future 5.It need not be adequate 6.It must be real and not illusory Contd..

7.It must be something which the promisor is not already bound to do. 8.It must not be illegal, immoral or opposed to Public policy.

Doctrine of privity of contract

The general rule of law is that only parties to a contract

may sue and be sued on that contract.(A stranger to a contract cannot sue) Exceptions:1.A trust or charge(beneficiary) 2.Marriage settlement, partition or other family arrangements 3.Acknowledgement or estoppel 4.Assignment of a contract 5.Contracts entered into through an agent 6.Covenants running with the land

Contract without consideration is void:

Exceptions
The general rule is that an agreement made without consideration is

void. Sections 25 deals with the exceptions to this rule. 1. Love and affection: [Sec. 25(1)] A written and registered agreement based on natural love and affections between near relatives is enforceable even if it is without consideration. 2. A Promise to pay for a past voluntary service is binding. 3. A Promise to pay a time barred debt [Sec. 25(3)]: A Promise by a debtor to pay a time-barred debt is enforceable, provided it is made in writing and signed by the debtor or his agent. 4. Completed gift (Sec. 25): the rule no considerationno contract does not apply to completed gifts. 5. Agency (sec. 185):- No consideration is necessary to create an agency.

CAPACITY TO CONTRACT
According to Sec. 11 every person is competent to

contract who1.is the age of majority according to the law to which he is subject 2.is of sound mind and

3.is not disqualified form contracting by any laws to which he is subjected

MINORS
According to Sec. 3 of the Indian Majority Act, 1875 a

minor is a person who has not completed 18 years of age. In the following 2 cases, he attains majority after 21 years of age.
Where a guardian of a minors property or person has

been appointed under the Guardians and Wards Act, 1890 or Where the superintendence of a minors property is assumed by a Court of wards.

Free consent
2 or more persons are said to consent when they

agree upon the same thing in the same sense (sec.13) Consent is said to be free when it is not caused by:1.Coercion as defined in sec.15 or 2.Undue influence as defined in sec.16 or 3.Fraud as defined in sec.17 or 4.Misrepresentation as defined in in sec.18 or 5.Mistake, subject to the provisions of secs.20,21&22

COERCION (SEC.15)
Coercion is committing or threatening to commit any

act forbidden by Indian Penal Code,1860 or the unlawful detaining or threatening to detain any property, to the prejudice of any person whatever, with the intention of causing any person to enter into an agreement.

UNDUE INFLUENCE(Sec.16)
A contract is said to be induced by undue influence

where the relations subsisting between the parties are such that one of the parties is in a position to dominate the will of the others and uses that position to obtain an unfair advantage over the others.

Misrepresentation
Misrepresentation is a false statement which the

person making it honestly believes it to be true or which he does not know to be false. According to section 18 there is misrepresentation1.when a person positively asserts that a fact is true when his information does not warrant it to be so. 2.when there is any breach of duty by a person which bring an advantage to another.

FRAUD(Sec.17)
According to Sec. 17 fraud means and includes any of

the following acts committed by (a) a party to a contract or (b) with his connivance or (C) by his agent, with intent to deceive another party thereto or his agent or to induce him to enter into the contract.

ESSENTIAL ELEMENTS OF FRAUD

There must be an intention to deceive The act must be done by a party to a contract or with

his connivance or by his agent. There must be a false representation of fact. There must be an active concealment of a fact which he has the knowledge and duty to disclose. There must be a false promise made without any intention to perform it The party so induced must have acted upon it and suffered loss.

FREE CONSENT
According to Sections 13 of the Act two or more

persons are said to consent when they agree upon the same thing in the same sense
. As per Sec. 14 of the Act, Consent is said to be free

when it is not caused by (1) Coercion (2) undue influence (3) fraud (4) misrepresentation or (5) mistake.

MISREPRESENTATION(Sec.18)
Consent given under misrepresentation of fact is no

consent at all . A statement made which in fact is not true, under the belief that it is true, is misrepresentation

MISTAKE
An erroneous belief about something is called

mistake. When an agreement as entered into under a mistake consent is not free. Mistake is of two kinds; (1) Mistake of facts, (2) Mistake of Law Where both the parties to an agreement are under a mistake as to a matter of fact essential to the agreement the agreement is void (Sec. 20). Mistake of facts are 2 types: (1) Bilateral or mutual mistakes and (2) Unilateral Mistake.

LEGALITY OF OBJECT & CONSIDERATION(Sec.23)

1.
2. 3. 4. 5.

IF IT IS FORBIDDEN BY LAW IF PERMITTED,IT WOULD DEFEAT THE PROVISIONS OF ANY LAW IF IT IS FRAUDULENT IF IT INVOLVES OR IMPLIES INJURY TO THE PERSON OR PROPERTY OF ANOTHER IF THE COURT REGARDS IT AS IMMORAL

UNLAWFUL AND ILLEGAL AGREEMENTS

UNLAWFUL AGREEMENT IS ONE WHICH LIKE A

VOID AGREEMENT, IS NOT ENFORCEABLE BY LAW.IT IS VOID AB INITIO.

EVERY ILLEGAL AGREEMENT IS UNLAWFUL, BU T

EVERY UNLAWFUL AGREEMENT IS NOT NECESSARILY ILLEGAL.

AGREEMENTS OPPOSED TO PUBLIC POLICY

AN AGREEMENT IS SAID TO BE OPPOSED TO PUBLIC POLICY

WHEN IT IS HARMFUL TO THE PUBLIC WELFARE. EXAMPLES 1.AGREEMENTS OF TRADING WITH ENEMY 2.AGREEMENT TO COMMIT A CRIME 3.AGREEMENTS WHICH INTERFERE WITH ADMINISTRATION OF JUSTICE 4.AGREEMENTS IN THE RESTRAINT OF LEGAL PROCEEDINGS 5.TRAFFICKING IN PUBLIC OFFICES AND TITLES 6. AGREEMENT IN RESTRAINT OF PARENTAL RIGHTS 7.AGREEMENTS RESTRICTING PERSONAL LIBERTY 8.AGREEMENTS IN RESTRAINT OF MARRIAGE 9.AGREEMENTS INTERFERING WITH MARITAL DUTIES 10.AGREEMENTS IN RESTRAINT OF TRADE

VOID AGREEMENTS
A Void Agreement is not enforceable by law. It has no legal existence or sanctity.
Types of Void Agreements:

1.Agreement made by an incompetent person Sec. 11 2.Agreement made under mutual mistake as to a matter of fact essential to the agreement Sec. 20. 3.Agreement made under mistake as to law not in force in India Sec.21 4.Agreement in consideration or object of which is unlawful Sec. 23 5.Agreement the consideration of object of which is unlawful in part Sec. 24 6.Agreement made without consideration sec. 25 (COTND.)

7 .Agreement in restraint of marriage Sec. 26 8. Agreement in restraint of trade - Sec. 27 9. Agreement in restraint of legal proceedings Sec. 28 10.Agreement in restraint of legal proceedings Sec. 29 11.Agreement by way of wager Sec. 30 12.Agreement contingent on an uncertain future event if the event becomes impossible Sec. 32. 13.Agreement contingent on an impossible event sec. 36 14Agreement to do an impossible act sect. 56

 When consideration or object is unlawful:

1

Forbidden by law (2) defeating the provisions of any law (3) it is fraudulent (4) it involves or implies injury to the person or property of another (5) if the court regard it is immoral

Wagering contract(x)
Agreement by wager are void and no suit shall be brought

for recovering anything alleged to be whom on any wager or entrusted to any person to abide by the result of any game or other uncertain event on which any wager is made (Sec. 30). A wager is an agreement by two parties to the effect that if a given uncertain event happens, one party shall pay a certain sum to the other and on the contrary event happening the other shall pay to the first. It is an agreement by which money is payable by one person to another on the happening or not happening of a future uncertain event.

CONTINGENT CONTRACT(x)
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 sec. 31.

SALE OF GOODS ACT,1930

The sale of goods is the most common of all Commercial contract. The law relating to it is contained in the sale of goods Act, 1930
The general provisions of the Indian contract Act, 1872 continue to apply to contracts for the sale of goods in so far as they are not inconsistent with the express provisions of the sale of goods Act, 1930.

FORMATION OF A CONTRACT OF SALE

Where under a contract of sale, the property in the

goods is transferred from the seller to the buyer, the contract is called a sale but where the transfer of the property in the goods is to take place at a future time or subject to some conditions thereafter to be fulfilled, the contract is called an agreement to sell. (Sec.4(3).) An agreement to sell becomes a sale when the time elapses or the conditions subject to which the property in the goods is to be transferred are fulfilled (Sec.4(4))

ESSENTIALS OF ACONTRACT OF SALE

1.
2. 3.

4.
5.

TWO PARTIES GOODS PRICE TRANSFER OF GENERAL PROPERTY ESSENTIAL ELEMENTS OF A VALID CONTRACT

DISTINCTION BETWEEN SALE AND AGREEMEN T O SELL

1.
2. 3. 4. 5. 6. 7.

8.

TRANSFER OF PROPERTY TYPE OF GOODS RISK OF LOSS CONSEQUENCES OF BREACH RIGHT TO RE-SELL GENERAL AND PARTICULAR PROPERTY INSOLVENCY OF BUYER INSOLVENCY OF SELLER

SALE & HIREPURCHASE AGREEMENT

A hirepurchase agreement is a contract whereby the

owner of the goods lets them on hire to another person called hirer or hirepurchaser on payment of rent to be paid in installments and upon an agreement, that when a certain number of such installments are paid, the property in the goods will pass to the hirer.

CLASSIFICATION OF GOODS

Price

Document of title to goods