What Is Contract
What is Contract? Discuss Essentials of Contact.
According to Section 2 (h) of the Indian Contact Act, 1872, "A contract is “an agreement enforceable by law”. A contract therefore, is an agreement the object of which is to create a legal obligation i.e., a duty enforceable by law.
From the above definition, we find that a contract essentially consists of two elements: (1) An agreement and (2) Legal obligation i.e., a duty enforceable by law.
As per section 2 (e) "Every promise and every set of promises, forming the consideration for each other, is an agreement." Thus it is clear from this definition that a 'promise' is an agreement. Section 2 (b) states that "When the person to whom the proposal is made signifies his assent thereto the proposal is said to be accepted. A proposal, when accepted, becomes a promise."
An agreement, therefore, comes into existence only when one party makes a proposal or offer to the other party and that other party signifies his assent (i.e., gives his acceptance) thereto. In short, an agreement is the sum total of 'offer' and 'acceptance'.
Example, A promises B to sell his horse for Rs. 10,000/-.
The Law of Contract deals with such promises which create legal obligations. This excludes those promises made in common life which may be morally binding but creates no legal binding. Promises which do not give rise to legal obligations are not contracts. For example, if A promises B to attend the dinner and fails to attend then B cannot sue A for the price of non-consumed food. The Law of contract creates obligation between the parties to the contract and not against the whole world.
According to Section 10, “All agreements are contracts if they are made by free consent of parties, competent to contract, for a lawful consideration and with a lawful object and are not hereby expressly declared to be void”. The essential elements of a valid contract are: 1. At least two person: There must be two or more persons to make an
According to Section 2 (h) of the Indian Contact Act, 1872, "A contract is “an agreement enforceable by law”. A contract therefore, is an agreement the object of which is to create a legal obligation i.e., a duty enforceable by law.
From the above definition, we find that a contract essentially consists of two elements: (1) An agreement and (2) Legal obligation i.e., a duty enforceable by law.
As per section 2 (e) "Every promise and every set of promises, forming the consideration for each other, is an agreement." Thus it is clear from this definition that a 'promise' is an agreement. Section 2 (b) states that "When the person to whom the proposal is made signifies his assent thereto the proposal is said to be accepted. A proposal, when accepted, becomes a promise."
An agreement, therefore, comes into existence only when one party makes a proposal or offer to the other party and that other party signifies his assent (i.e., gives his acceptance) thereto. In short, an agreement is the sum total of 'offer' and 'acceptance'.
Example, A promises B to sell his horse for Rs. 10,000/-.
The Law of Contract deals with such promises which create legal obligations. This excludes those promises made in common life which may be morally binding but creates no legal binding. Promises which do not give rise to legal obligations are not contracts. For example, if A promises B to attend the dinner and fails to attend then B cannot sue A for the price of non-consumed food. The Law of contract creates obligation between the parties to the contract and not against the whole world.
According to Section 10, “All agreements are contracts if they are made by free consent of parties, competent to contract, for a lawful consideration and with a lawful object and are not hereby expressly declared to be void”. The essential elements of a valid contract are: 1. At least two person: There must be two or more persons to make an