Contract Act 1872 (Sheet-2)
Is silence treated as fraudulent ?
Difference between Void and Voidable contract.
Silence be fraudulent?
1. Mere silence is not fraud.
2. Silence can be fraudulent in circumstances.
3. Silence is fraud where silence is in itself equivalent to
speech.
Void Vs Voidable contract :
Point of view
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Void Contract
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Voidable Contract
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Definition
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An agreement not enforceable by law is
said to be void.
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An agreement which is enforceable by law at
the opinion of one or
more of the parties thereto,
but not at all the opinion of the other or
others is a voidable contract.
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Right and obligation
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A void agreement confers no right on any person and creates
no obligations.
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But in case of voidable agreement
the rights and obligations of the parties
concerned are present
unless it becomes void.
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Declaration for voiding
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As a void agreement is void from the beginning it is not
necessary for the effected party to declare the agreement void.
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But in case of voidable agreement the
effected party needs to call the agreement void.
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Refund
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In case of void agreement the party is not bound to refund
the benefit received to other party.
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But in case of voidable agreement
party may refund the
benefit to the other party,
if the agreement
becomes void later on.
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In which cases a Contract can void? Or
When is an agreement said to be void?
An agreement is said to be
void because of mistake, lack of consideration, want of capacity etc.
A list of reasons for void
agreements is given below:
1. Lack of capacity;
2. Mutual mistake of fact;
3. Unlawful consideration
or object;
4. Consideration or object
partly
5. Agreements without
consideration;
6. Agreements in restraint
of trade;
7. Agreements is restraint
of legal proceedings;
8. Uncertain agreement;
9. Agreements by way of
wager;
10. Impossible acts;
11. Agreements contingent
on impossible event;
12. Reciprocal promises where there are void
promises.
Difference between Contingent Contract vs. Wagering
Agreement.
Describe - Supervening impossibility, Doctrine of
Frustration, Counter offer.
Contingent Contract vs. Wagering Agreement
The distinctions between contingent contract and wagering
agreement are given below:
Point of view
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Contingent Contract
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Wagering agreement
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Validity
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A contingent contract is valid.
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A wagering agreement is void.
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Dependency
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It depends on the happening or non‐happening
of an event, but the contract is valid.
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It is void.
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Reciprocal promises
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It may not contain reciprocal promises.
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It consists of certain reciprocal
promises.
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Difference between a contract and an agreement
Describe different type
of contracts
Distinguish between a contract and an agreement
Point of view
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Contract
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Agreement
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Definition
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An agreement enforceable by law is Contract.
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Promise or every set of promises
forming the consideration for each
other, is an
agreement.
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Similarity
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All contracts are agreements
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All agreements are not contact.
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Describe different type of contracts (Cont…)
Different types of contracts:
Quasi Contract
A quasi contract is a contract that exists by order of a
court, not by agreement of the parties. Courts create quasi contracts to avoid
the unjust enrichment of a party in a dispute over payment for a good or
service. In some cases a party who has suffered a loss in a business
relationship may not be recover for the loss without evidence of a contract or
some legally recognized agreement. To avoid this unjust result, courts create a
fictitious agreement where no legally enforceable agreement exists.
To illustrate, assume that a homebuilder has built a
house on Alicia’s property. However, the homebuilder signed a contract with
Bobby, who claimed to be Alicia’s agent but in fact, was not. Although there is
no binding contract between Alicia and the homebuilder, most courts would allow
the homebuilder to recover the cost of the services and materials from Alicia
to avoid an unjust result. A court would accomplish this by creating a
fictitious agreement between the homebuilder and Alicia and holding Alicia responsible
for the cost of the builder’s service and materials.
Executed and Executory Contracts
An executed contract is one in which nothing remains to be
done by either party and where the transaction is
completed at the moment that the agreement is made,‐
as where an article is sold, and delivered, and payment therefore is
made on the spot.
A. Contracts to sell personal property are executory,
while a completed sale by delivery is executed; but the
language used in an agreement about the sale may not always be
decisive whether the one or the other is
meant.
B. An executory contract is a contract to do some
future act, such as where an agreement is made to build a
house in six months, or to do an act on or before some future
day, or to lend money upon a certain interest
payable at a future time.
C. Where the contract is executory, if the agreement be
that one party shall do a certain act, or acts for the
performance of which the other party shall pay a sum of money,
the performance of the act is a condition
precedent to
the payment of the money.
Describe different type of contracts (Cont…)
Different types of contracts:
Bilateral Contract
A bilateral contract is a reciprocal arrangement between two
parties where each promises to perform an act in exchange for the other party’s
act. Each party is an (a person who is bound to another) to its own promise,
and an oblige (a person to whom another is obligated or bound) on the other
party’s promise. A bilateral contract specifies a duty to act in exchange for
another party’s duty to act.
Unilateral Contract
A legally enforceable promise‐between legally competent party to
do refrain from doing a specified, legal act or acts. In a unilateral contract,
one party pays the other party to perform a certain duty. If the duty is
fulfilled, the party on the other side of the contract is obligated to transfer
the specified funds. Only this party is under obligation of the contract,
whereas the acting party is not legally obliged to perform the duty.
Valid Contract
A contract that complies with all the essentials of a contract
and is binding and enforceable with all associated parties.
Void Contract
Contract
that (i) is legally (inherently void) from the moment it is made, (ii) is legal
but declared null (having no legal effect) by the courts because it violates a
fundamental principle such as fairness, or is contrary to public policy, (iii)
becomes void due to changes in law or in government policy, or (iv) has been
fully performed. Lack of capacity to contract (being an infant or minor,
intoxicated, or insane) automatically makes a contract void. Contract that is
void only in one or few parts may be saved by the process of severance. Not to
be confused with voidable contract.
Describe different type of contracts (Cont…)
Different types of contracts:
Voidable Contract
Unlike a void contract, it is a valid contract. At most, one
party to the contract is bound. The unbound party may repudiate the contract,
at which time the contract is void.
For example, depending upon jurisdiction, a minor has
the right to repudiate certain contracts. Any contract with a minor is thus a
voidable contract. If a minor were to enter into a contract with an adult, the
adult would be bound by the contract, whereas the minor could choose to avoid
performing the contract. Therefore, when entering into contracts with a minor,
people often require the co signature of an adult, preferably a parent or legal
guardian.
Illegal Contract
A contract
that is prohibited by status (e.g. one between traders providing for minimum
resale prices) or is illegal at common law on the grounds of public policy. An
illegal contract is totally void, but neither party (unless innocent if the
illegality) can recover back any money paid or property transferred under it.
Related transactions may also be affected. A related transaction between the
same parties (e.g. if X gives Y a promissory note for money due from him under
an illegal contract) is equally tainted with the illegality and is therefore
void. The same is true of a related transaction with a third party (e.g. if Z
lends X the money to pay Y) if the original illegality is known to him. In
certain circumstances, illegal contracts may be saved by severance.
Describe different type of contracts (Cont…) What
are the remedies for breach of contract?
Different types of contracts:
Unenforceable Contract
It is a transaction is one that is valid, but which the court
will not enforce. Uncorrectable is usually used in
contradistinction to void (or void ab initio)
and voidable. If the parties perform the agreement, it will be valid,
but the court will not compel them if they do not.
An example of a transaction which is an uncorrectable contract
is a contract for prostitution under English Law. Prostitution is not actually
a crime under English Law, although both soliciting a prostitute and living off
the earnings of prostitution are criminal offences but so long as the contract
is fully performed, it remains valid. However, if either refuses to complete
the bargain (either the prostitution after being paid or the payer after
receiving the services), the court will not assist the disappointed party.
To impugn a contract means attacking the integrity of the
contract. A way this can be done is by deeming the
contract unenforceable. A contract can be said unenforceable
when it goes against the statuses of fraud or the Statement of Goods Act.
Remedies for breach of contract
1. Rescission of the contract.
2. Suit for damages.
3. Suit upon Quantum Meruit
4. Specific performance of the contract.
5.
Injunction.
Ignorance of law is no excuse to avoid a contract" –
Discuss. Can a minor make a contract? Rules regarding “Offer”.
Ignorance
of law is no excuse to avoid a contract"
We all are working and
exercising our right and obligation under the law. These laws are unlikely to
be known to all of us. So, the ignorance of law is not a valid reason to avoid
contract. In this case, contract should be performed specifically.
Can a minor
make a contract?
As per section 11 of
contract act a minor is not competent to a contract. So he/she cannot make a
contract. If any contract is made by the minor, it will be a void agreement.
Rules
regarding an offer
1. An offer may be express
or may be implied from the circumstances;
2. An offer may be made to
a definite person; to some definite class of persons; or to the world at large;
3. Legal relationship is
required;
4. The terms of the offer
must be certain, definite, unambiguous and not vague;
5. A mere statement of
intension is not an offer;
6. An offer must be
communicated to the offeree;
7. An offer may be
conditional;
8. Printed contracts.
Who can accept an offer? How an offer to be communicated?
How an acceptance to be communicated?
Who can
accept an offer?
An offer can be accepted
only by the person or persons for whom the offer is intended which includes the
following:
1. An offer made to a
particular person can only be accepted by him because he is the only person to
accept.
2. An offer made to a
class of persons can be accepted by any member of the class.
3. An offer made to the
world at large can be accepted by any person whatsoever.
How an
offer to be communicated?
An offer may be
communicated to the offeree or offerees by word of mouth, by
writing or by conduct.
How an
acceptance to be communicated?
An acceptance to be
communicated by the following:
1. Offer and Acceptance by
post
2. Offer and acceptance
through telephone
3. Microphone
4. E‐mail
5. Internet
Rules regarding acceptance of an offer. What are types of
agreements said to be void? What types of agreements become void?
Rules
regarding acceptance of an offer
The acceptance of an offer
to be legally effective must satisfy the following requirements:
1. It must be an absolute
and unqualified acceptance of all the terms of the offer.
2. Conditional acceptance
/ Counter offer.
3. Contract subject to
condition
4. Clarification
5. the acceptance must be
expressed in some usual or reasonable manner
6. Mental acceptance or un‐communicated assent does not result in a
contract
7. The mode of acceptance
8. Time of acceptance
9. When acceptance is
complete
10. Before offer
11. The acceptance must be
made while the offer is in force.
What are
types of agreements said to be void?
The following agreements
are void from the beginning:
1. An agreement made by a
minor;
2. Agreements without
consideration;
3. Certain agreements
against public policy..
What
types of agreements become void?
An agreement, which was legal and enforceable
when it was entered into, may subsequently become void due to impossibility of
performance, change of law or other reasons. When it becomes void the agreement
ceases to have legal effect.
What types of agreements are expressly declared void? What
types of agreements are unenforceable by law? Distinct between void agreement
and illegal agreement
What
types of agreements are expressly declared void?
There are certain
agreements, which are expressly declared to be void, are summarized hereunder:
1. Every agreement in
restraint of marriage of any person, other than a minor, is void
2. Every agreement by
which anyone is restrained from exercising a lawful profession, trade or
business of
any kind, is to that
extent void
3. Private individuals
cannot by agreement alter or vary their personal law or the statute law
4. Agreements, the meaning
of which is not certain, or capable of being made certain, are void
5. Agreement by way of
wager are void
6. Agreements to do and
act impossible in itself are void
7. Agreements whose
objects or considerations are unlawful are void
What
types of agreements are unenforceable by law?
An agreement which cannot
be enforced in a court of law, one or both of the parties, because of some
technical defect, e.g. want of registration or non‐payment of the requisite stamp duty is
unenforceable e by law.
Distinct
between void agreement and illegal agreement
Subject
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Void
agreement
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Illegal
Agreement
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Definition
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An
agreement not enforceable by law is
said to
be void.
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An
illegal agreement is one, which is
against
a law in force.
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Nature
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A void
agreement is not necessarily illegal.
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An
illegal agreement is also void
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Under which circumstances a person is incapable of
entering into contracts? What are the exceptions regarding the rules to minor?
Under
which circumstances a person is incapable of entering into contracts?
A person is incapable of
entering into contracts under the following circumstances:
1. if he is not attained
the age of majority according to the law to which he is subject
2. if he is not of sound
mind
3. if he is disqualified
from contracting by and any law to which he is subject.
What are
the exceptions regarding the rules to minor?
To the minor's rule there
are two exceptions which are given below:
1. When a guardian of the
minor’s person or property is appointed by a court of law and
2. When a minor’s property
is taken over by the Court of Wards for management.
In either case minority
continues up to the completion of the 21st year.
What is
the test of soundness of mind?
The test of soundness of
mind is given hereunder:
1. Capacity to understand
the business concerned
2. Ability to form a rational judgment
Coercion, Undue influence, Fiduciary relationship
Coercion
Coercion is the committing
or threatening to commit, any act forbidden by penal Code, or 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.
Consequences
of coercion
The consequences of
coercion are given below:
1. Voidable at the option
of the party whose consent was so caused
2. The aggrieved party can
have the contract set aside or he can refuse to perform it and take the defense
of
coercion if the other
party sought to enforce it.
3. The aggrieved party may
if he so desires abide by the contract and insist on its performance by the
other
party.
Undue
influence
A contract is said to be
induced by undue influence where –
1. One of the parties is
in position to dominate the will of the other.
2. He uses the position to
obtain an unfair advantage over the other.
Fiduciary
relationship
Fiduciary relationship
means a relationship of mutual trust and confidence. Such a relationship is
supposed to exist in
the following cases:
1. father and son
2. guardian and ward
3. solicitor and client
4. doctor and patient
5. preceptor and disciple
6. trustee and beneficiary
Misinterpretation
What do
you mean by misrepresentation?
Misrepresentation arises
when the representation made in inaccurate but the inaccuracy is not to any
desire to defraud the other party. There is no intension to deceive.
What are
the causes of misrepresentation?
The causes of
misrepresentation are –
1. Unwarranted assertion
2. Breach of duty
3. Innocent mistake
What are
the consequences of misrepresentation?
The consequences of
misrepresentation are –
1. The aggrieved party can
avoid the agreement
2. The aggrieved party can insist that the
contract be performed and he shall be put in the position is which he would
have been if the representation made had been true.
Fraud
What is
fraud?
The term fraud includes
all acts committed by a person with a view to deceive another person. To
deceive means to induce a man to believe a thing is true which is false.
What type
of acts to be considered as fraud?
1. False statement
2. Active concealment
3. Intentional non‐performance
4. Deception
5. Fraudulent act or
omission
What are
the consequences of fraud?
A party who has been
induced to enter into an agreement by fraud has the following remedies open to
him:
1. Avoidance of
performance of the contract
2. Insistence of
performance of the contract
3. Sue for damage
How can
the relief for fraud be obtained?
Relief for fraud can be
obtained only if the following conditions are satisfied:
1. Act committed by a
party or agent
2. Act must have been done
with the intension to deceive and must actually deceive.
3. Consent obtained by the
act complained of Silence
4. The remedy of rescinding not available
Uberrimae fidei contracts
What is
meant by the Uberrimae fidei contracts?
Uberrimae
fidei contracts are contracts where law imposes upon the parties the
duty of making a full disclosure of all
material facts.
What type
of contract come within the class of Uberrimae fidei contracts?
The following types of
contract come within the class of Uberrimae fidei:
1. Contracts of Insurance
2. Fiduciary relationship
3. Contracts for the sale
of immovable property
4. Allotment of shares of
companies
5. Family settlement
Mistake in contracts
What do
you mean by mistake?
An erroneous belief
concerning something is called mistake.
How many
classes of mistakes?
1. Mistake of law
2. Mistake as to a law not
in force in Bangladesh.
3. Mistake of fact
What is
meant by bilateral mistake?
When both the parties of
the contract mistake are called bilateral mistakes.
What is
meant by unilateral mistake?
When one of the parties of
the contract mistakes is called unilateral mistakes.
What are
the rules regarding mistake?
1. Mistake of law
2. Mistake of fact
3. Opinion
4. Unilateral mistake
Unlawful consideration and object Wager agreement
When are
the consideration and the object of an agreement unlawful?
The consideration and the
object of an agreement are unlawful in the following cases:
1. If it is forbidden by
law.
2. If it is of such a
nature that, if permitted, it would defeat the provision of any law.
3. If it is fraudulent.
4. If it involves or
implies injury to the person or property of another.
5. If the court regards it
as immoral.
6. If the court regards it
as opposed to public policy.
What do
you mean by wager?
A wager is an agreement by
which money is payable by one person to another on the happening or non
happening of a future, uncertain event.
What are
the characteristics of a wager agreement?
The characteristics of a
wager agreement are given below:
1. The consideration for
the promise under a wagering agreement is to pay or get money.
2. The money is payable on
the happening or the non‐happening
of an event.
3. The agreement depends
on a future and uncertain event.
4. The essence of gaming
and wagering is that one party is to win and the other loses.
5. In wagering agreement
no party has control over the event.
6. Commercial transactions
are valid, but to pay price differences in a wagering agreement is void.
Which are
the transactions not wagers?
a) Shares.
b) Games of skill.
c) A statutory exception.
d) Contract of Insurance.
Contingent contract Termination of contract
What do
you mean by contingent contract?
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.
What are
the characteristics of contingent contracts?
1. The performance of such
contract depends on a contingency, i.e., on the happening or non happening of
the future event.
2. The event must be
collateral i.e., incidental to the contract.
3. The contingency is
uncertain.
What are
the methods of termination of a contract?
1. By performance of the
promise or tender.
2. By mutual consent
canceling the agreement or substitute in a new agreement in place of the old.
3. By subsequent
impossibility of performance.
4. By lapse of time.
5. By material alteration
without the consent of the other parties.
6. By breach made by other parties.
Quasi contract Contract of indemnity
Describe
the cases which are to be deemed to be Quasi Contract.
The cases which are to be
deemed to be Quasi Contract are describing below:
1. Necessaries for
incapable person.
2. Reimbursement of
interested person.
3. Benefit of non‐gratuitous act.
4. Finder of goods.
5. Delivery by mistake or
under coercion.
What do
you mean by contract of indemnity?
A contract of indemnity is
a contract by which one party promises to save the other party from loss caused
to him by the conduct of the promisor himself, or by the conduct of any
other person.
What are
the characteristics of contracts of indemnity?
The characteristics of
contracts of indemnity are given hereunder:
1. A contract of guarantee
must satisfy all the essential elements of a contract.
2. The contract may be
expressed or implied.
What are
the rights of the indemnity holder?
1. All damages which he
may be compelled to pay in any suit in respect of any matter to which the
promise to
indemnify applies.
2. All costs which he may
be compelled to pay in such suits.
3. All sums which he may have paid upon
compromise of such suit.
Contract of guarantee
What do
you mean by contracts of guarantee?
A contract to perform the
promise or discharge the liability, of a third person in case of his default.
How many
types of contracts of guarantee?
1. For payment to the
creditor to the principal debt or by the guarantor.
2. Payment of price for
goods sold.
3. Fidelity guarantee.
What are
the essentials of valid guarantee?
1. Must satisfy all the
essential elements of a contract.
2. May be oral or written.
3. There must be three
parties.
4. The primary liability
is that of principal debtor.
5. Minor
6. Consideration
Which are
the invalid contracts of guarantee?
1. Misrepresentation.
2. Concealment.
3. Lack of essential
elements.
What do
you mean by Continuing Guarantee?
A guarantee which extends
to a series of transaction is called continuing guarantee.
How is a
continuing guarantee revoked?
1. By notice of revocation
by the surety.
2. By the death of the surety.
Bailment
What do
you mean by Bailment?
A bailment is the delivery
of goods by one person to another for some purpose, upon a contract that they
shall,
when the purpose is
accomplished be returned or otherwise disposed of according to the direction of
the person
delivering them.
Who are bailor,
bailee?
Bailor: The
person delivering the goods is called the bailor.
Bailee: The
person to whom they are delivered is called the bailee.
Bailment:
The transaction is called Bailment.
What are
the characteristics of Bailment?
The characteristics of
Bailment are given below:
1. Delivery.
2. Purpose
3. Return.
4. Contract.
5. Movable goods.
6. Possession.
Bailment
What are
the kinds of Bailment?
1. Gratuitous Bailment:
A gratuitous bailment is one in which neither the bailor, nor the bailee
is entitled to
remuneration.
2. Bailment for reward:
A bailment for reward is one where either the bailor or the bailee is
entitled to
remuneration.
What are
the duties of the Bailee?
The duties of the Bailee
are given below:
1. Duty of reasonable
care.
2. Unauthorized use of
goods.
3. Mixture of Bailor’s goods
with the Bailee’s.
4. Duty of returning
goods.
5. Accretion to the goods
bailed.
6. Liabilities of
Innkeeper and Hotelkeepers.
7. Liabilities of carrier.
What are
the duties of the Bailor?
The duties of the Bailor
are given below:
1. Bailor’s duty to
disclose faults in goods bailed;
2. Payment of expenses in
Gratuitous Bailment;
3. Responsibility for
breach of warranty of title;
4. Enforceable of rights;
5. Act inconsistent with
the terms;
6. Restoration of goods lent gratuitously
Sales of goods
Definition
of sale:
A contract whereby the seller
transfers or agrees to transfer the goods to the buyer for
a price
Either transfer of
property, or
Agree to transfer
Agreement
to Sell:
Where the transfer of
property is to take place at a future time or subject to some conditions it is
called Agreement
to Sell. An agreement to
sell becomes a sale when‐
Prescribed time has
elapsed or
The stipulated conditions
has been fulfilled
Sale vs.
agreement to sale
Risk: Risk prima
facie passes with property. Where there is a sell subsequent losses falls
on the buyer, but not in the case of agreement to sell.
Possession
/ title: In case of sell property passes to the buyer but in the case of
agreement to sell it remains with seller.
Essential
elements:
Two
parties: a sale is a bilateral contract i.e., buyer and seller must be
separate person. In an exceptional case a partner may sell goods to his firm
and the film may sell goods to partner. The parties of the contract must be
competent.
Movable goods: the act deals only with movable goods excepting actionable claims
and money. An exchange of goods is not a sale, but it exchange is made partly
for goods and party for money it would be considered as sale..
Sales of goods (Continued…)
Formation
of a contract: the contract may provide for immediate delivery of goods or
immediate payment of price or both, or for the delivery and payment by
installments. A contract of sale may be writing, verbal, or may be implied from
the conduct of the parties.
Terms of
contract: essentials terms are called conditions and non‐essentials terms are called warranties.
Other
essential elements: the contract must be based on free consent, appropriate
consideration and the object must be lawful.
Contract
is void, if
1. Goods unknown to seller
2. Goods have perished or
damaged
3. Happening of any event
that damages the goods between the times of agreement. to sell and sale
Condition
and warranty
A
condition is a stipulation essential to the main purpose of the contract,
the breach of which gives rise to right to treat the contract as repudiated. It
also creates of right to get damages.
A warranty is a stipulation collateral to the main purpose of the contract,
the breach of which gives rise to a claim for damages but not to a right to
reject the goods and treat the contract as repudiated.
Sales of goods (Continued…)
Breach of
condition to be treated as a breach of warranty:
Where contract is not
servable and the buyer has accepted the goods or part thereof
Goods or property has
lost/missing/damaged
Implied
condition:
Condition to title,
getting possession
Sale by description‐supplied goods shall be in accordance with
mentioned specification
By sample‐supplied goods shall agree with provided
sample
Quality & fitness
Implied
warranty:
Buyer shall have quiet
possession
Goods are free from any
charge/encumbrance
The
doctrine (principle) of Caveat Emptor
Caveat Emptor is a Latin
expression which means “buyers beware”. The doctrine of caveat emptor means that,
ordinarily, a buyer must buy goods after satisfying himself of their quality
and fitness. If he makes a bad choice he cannot blame the seller. The rules
probably originated at a time when goods were mostly sold in market overt
(open) and the buyer had to depend upon own skill and judgment.
Exceptions:‐
1. Where the buyer relies
upon the skill and judgment of the seller.
2. Where by custom an
implied condition of fitness is annexed to a contract of sale (say, juice in
the container
should be kept with
merchantable quality)
3. Where there is a sale
of goods by description there is an implied condition that the goods are fit
for sale.
4. Where the seller is guilty of fraud the
seller is not protected by the doctrine of caveat.
Sales of goods (Continued…)
Passing
risk
“RISK PRIMA FACIE PASSES
WITH THE PROPERTY”
Risk generally passes with
the property; that means goods remains at seller’s risk till property is
passed; after
passing it is at buyer’s
risk.
Exception:
delivery has been delayed by default of Buyer or Seller; risk is
of the party in default.
Transfer
to Title
No seller
of goods can give the buyer of goods a better title than himself has‐Discuss
“MAKIM
NEMO DAT QUOD NON HABET”
The general rule is that only
the owner of goods can sell the goods. No one can convey to a transferee a
better title than he himself has.
Exception:
in the following cases, a person who is not an owner can give to
the transferee a valid title to the goods.
Estoppel:
Under certain
circumstances the true owner may be prevented, by his conduct, from denying the
seller’s authority to sell.
X is the owner of certain goods.
X acts in such a manner that Y is induced to believe that the goods belongs to
Z. On that belief Y buys the goods from Z. Under these circumstances, the court
will not allow X to prove this ownership.
Sales of goods (Continued…)
Rules
regarding performance/execution of contract:
1. It is seller’s duty to
deliver the goods and of the buyer to accept and pay for it.
2. Delivery and payment
are concurrent condition. Unless otherwise..
3. Part delivery‐has the effect of passing as a whole.
Unless..
4. In the absence of a
contract seller is not bound to deliver until buyer applies for delivery
5. Rules to delivery
Place: place of sale;
place of production
Time: stipulated or
reasonable time
3rd party possession: to
be acknowledged by 3rd party on behalf of buyer
Unless otherwise mentioned
expenses relating to delivery to be borne by seller.
6. Delivery of wrong qty:
lesser qty, larger qty, mixed qty, the buyer may reject, if accepts he must pay
for it
7. In the absence of
agreement the buyer is not bound to accept delivery of goods by installment
8. If seller is required
by contract to deliver the goods to a carrier, is prima facie delivery to the
buyer
9. Buyer right of
examination‐ will get
reasonable time to examine the delivered goods
10. Liability of buyer to
take delivery of goods‐buyer
will be liable for loss
Unpaid
seller: (S‐45)
Unpaid seller means a
seller when,
The whole price has not
been paid
Negotiable instrument has not been honored
Sales of goods (Continued…)
Right of
unpaid seller:
Against the goods:
A lien on the goods for
the price
Stoppage in transit
Right to resell under
certain condition
Against the buyer:
Suit for price
Damage for non‐acceptance
Breach of
contract:
Suit for price: seller may
sue the buyer for the price of the goods, when goods are sold, passed to the
buyer
Damage for non‐acceptance: seller may sue the buyer for
damages……….if the wrongfully refuses/reject
Damage for non‐delivery: buyer may sue for damages for non‐delivery by seller
Specific performance:
buyer may sue for specific/described or ascertained performance
Effect of reputation:
contract is made, if one party repudiates, other party may keep it alive till
to due date
and sue for damages.
Syed Mehedi Hasan, ACMA, A 1094
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