Meaning: the term contact is derived from the Latin word “ contractum” which means drawn
together “it is an agreement entered into between two are more persons /parties subject to certain
terms and conditions for lawful consideration.
Eg; A and B entered into an agreement. A promises B to sell his house for Rs 4000 and B
accepts to purchase it for the said amount. it is a contract between A and B.
In the contract, there are two parties namely the offeror and the party who is the acceptor. in the above example both (A and B entered into a contract, and if A fails to sell the land to B, then B can
file a suit in court against A ) it amounts to a breach of contract which is enforceable in a court.
Definition of contact ; section 2(h) and section 10
Section 2(h) of the contact of the Indian contract act,1872 defines a contract as an agreement enforceable by law. Thus for a contract, it should contain :
• An agreement
• The agreement should be enforceable by law.
The conditions for enforceability of a contract lawful considerations under section 2(d) and sec 25. Competence of parties under sec11 and 12, free consent under section14 to 22, and the lawful object under sections 23 to 30.
Agreement; section 2(C) of the contract act defines agreement as every promise and every set of
promises forming the consideration as “every promise and every set of promises forming the
consideration for each other is an agreement”.
To make an agreement:
• There must be at least two parties.
• There must be a proposal or offer from one person/party.
• There must be an acceptance from the other person/party.
Section 10: According to section 10 of the Indian contract act, 1872, all agreements are contracts,
if they are made by the free consent of the parties, competent to contract, for a lawful consideration
and with a lawful object and are not hereby expressly declared to be void.
Difference between contract and agreement :
1) It emerges from a contract. It emerges from the consent of the parties.
2) sec 2(H) and contract 10 defines
section 2(e) defines an agreement.
3) every contract is an agreement Every agreement is not a contract
4) it is legal and is enforceable It should be moral and maybe not enforceable
Essentials of contract:
To constitute a contract the following conditions are to be satisfied.
1) There should be two parties ( offeror under section 2(a) and acceptor section 2(b)
– to constitute a contract there should be an offer and acceptor, the offer and
acceptance should be communicated properly to each other.
Case law: A contract entered into with a minor is void ab initio ( invalid at the very beginning ) as laid down by in a leading case of Moharibibee v. Dharmadas Ghose ( 1903) 30 I.A 114 (PC).
2) Identity of minds ( consensus-ad-idem)
In mean words, both parties should have consent towards the subject in the same sense and at the same time, in the absence of these, the contract is null and void.
3) Capacity to contract section 11:
– The parties to the contract must be competent to enter into a contract. According to section 11 of the Indian contract, any person who is competent in the contract should –
– He should be a major
– He should be of sound mind
– He shouldn’t be disqualified by law in force to contract
4) Free consent section 14
When both parties act own accordance and act without any coercion, consent should be free, when it is not caused by
– Coercion ( section 15)
– Undue influence ( section 16 )
– Fraud ( section17)
– Misrepresentation( section18 )
5) Lawful considerations section 2(d)
Consideration is one of the important things in the contract, without consideration there is no contract, consideration means ( something in return ) in others words a contract without consideration is null and void
Eg: X sells his car to Y for RS 50,000, here X’s s lawful consideration is 50,000 at the
same time Y’s consideration is the car.
6) Lawful object section (23 )
For a contract to be valid, the object for which it has been entered into must be lawful. According to section23 of the Indian contract act,1872” an agreement entered into with lawful consideration or object is declared void, if it is :
o Forbidden by law
o Causing injury or to person
7) Terms must be certain
In simple words, the terms of the contract must be clear and certain. Otherwise, the contract is not valid and enforceable
Eg: A offers B to supply parts of a vehicle. But the particulars of the vehicle are not mentioned. Since the nature of the car is not mentioned the contract is not enforceable.
2) law of contract Dr s.s Srivastava.