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TH E IN D IA N C O N TR A C T

A C T,1872

Presented by:
Shivaang
Shivam
Shrutika
Shubham
Sonal
Sonali
Tanya

ESSEN TIALS O F A VALID CO N TRACT


The following are the essential elements of a
valid contract:
1. Offer and Acceptance
2. Intention to create legal relationships
3. Lawful Consideration
4. Capacity of parties
5. Free Consent
6. Lawful Object
7. Written and Registration
8. Certainty of meaning/Clarity
9. Possible Performance
10. Not Void

CLARITY

The literal meaning of clarity as per Webster is : the quality of


being easy to see or hear , sharpness of image or sound .
Hence the term or terms of contract should be certain and
precise. They should not be vague and they should not create
any confusion in the minds of parties.

A G R EEM EN T V O ID FO R
U N C ER TA IN TY
Agreement, the meaning of which is
not certain, or capable of being
made certain, are void.

IN CO M PLETN ESS
When parties have failed to

include all essential terms they


need for the agreement.
Must be agreement on all essential

term

IN CO M PLETN ESS D U E TO
O M ISSIO N S
Omission of essential

terms=contract void for


uncertainty
Whether or not a particular term

will be found to be essential


depends on the nature of the
agreement

For a term to be im plied,the


follow ing conditions m ust be
satisfi
ed:
It must be reasonable and equitable
It must be so obvious that it goes

without saying
It must be capable of clear expression
It must not contradict any express
term of the contract

ILLU S TR ATIO N S A agrees to sell B a hundreds tons of oil.

There is nothing whatever to show that what


kind of oil is intended. The agreement is void
for uncertainty because there is no clarity
about the kind of oil.
A agrees to sell B one hunderd tons of oil of

a specified description, known as an article of


commerce. There is no uncertainty here to
make the agreement void.

ILLU STRATIO N S A, who is a dealer in coconut-oil only,

agrees to sell to B one hundred tons of


oil. The nature of As trade affords an
indication of the meaning of the words,
and A has entered into a contract for the
sale of one hundred tons of coconut-oil.
A agrees to sell B all the grain in my

granary at ramnagar. There is no


uncertainty here to make the agreement
void.

C A S E S TU D Y 1

NICOLENE LTD V SIMMONDS


[1953]

FACTS:

D agreed to sell P steel bars.

Letter between the parties (the alleged contract) it


was stated: I assume that the usual conditions of
acceptance apply

D failed to deliver and sought to rely upon the


statement to create uncertainty.

ISSUE:
Did a lack of explicit agreement on the condition
of acceptance mean that there was no contract?
HELD:
A valid contract existed as meaningless clauses are
irrelevant
Denning LJ: there were no usual conditions of
acceptance and so it is said that those words
are meaningless, that there is nothing to
which they can apply, and that, therefore,
there was never any contract between the
parties. In my opinion, a distinction must be
drawn between a clause which is meaningless
and a clause which is yet to be agreed. A

C A S E S TU D Y 2
S C A M M ELL V O U S TO N 1941

SCAM M ELL V O U STO N 1941


The parties entered an agreement

whereby scammell were to supply a


van 286 on HP terms over 2 years
and Ouston was to trade in his old
van for 100. There was then some
disagreement and Scammel refused
to supply the van.

Held:

There was no certainty as to the


terms of the agreement. There was
agreement on the price there was
nothing in relation to the HP terms
stating whether it would be weekly
or monthly installments or how much
the installments would be.

H O W C A N A M B IG U O U S C O N TR A C T
B E AV O ID ED
WRITING: its best to put all the contract terms in writing.
Different Meanings: if a particular term or phrase has two

meanings,make sure that its means the same meaning for both
parties and make a note of any alternative meaning.
Other document: Attach any other related document to

contract that could be used later on to clear any disagreements.


Review: Have each party review the full and complete contract

before each party signs off on it.


Legal advice: Obtain professional advice from an experienced

contract attorney and have them review the contract to resolve


any ambiguous terms that may cause future problems.

REFEREN CES
Singh Avtar:Principles of mercantile

law,Eastern Book co,2006


Kapoor ND: elements of mercantile
law,sultan chand& sons,1999
https://en.wikipedia.org/wiki/Certaint
y_in_English_law
https://en.wikipedia.org/wiki/Indian_
Contract_Act,_1872

TH AN K YO U