Agreements in restraint of legal proceedings void Saving of contract to refer to arbitration Contract to do act afterwards becoming impossible or unlawful. B-LAW NOTES UNIT CONTRACT ACT 1Q. Define contract? Discuss the essential elements of a valid contract? (Or) Law of contract is not the whole of law of. Article 4 The parties shall, pursuant to law, have the right to enter into a contract on their A legally executed contract is protected by law.
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PDF | 3 hours read | On Jan 1, , Mindy Chen-Wishart and others published Contract Law. PART III. VOIDABLE CONTRACTS AND VOID AGREEMENTS. What agreements are contracts. Persons competent to contract. What is a sound mind. This Act may be called the Indian Contract Act,.. section Ill of the Indian Evidenc. The Indian Contract Act, enforceable by law becomes void when it.
A gratuitous bailment terminates in any of the following circumstances—. In the absence of any contract to the contrary, a bailee shall deliver to a bailor or according to the directions of a bailor, any increase or profit which may have accrued from the bailed goods.
A bailor is responsible to a bailee for any loss which the bailee may sustain, where the bailor was not entitled to make the bailment or to receive back the goods or to give directions, in respect of the goods. In the absence of an agreement to the contrary, where several joint owners of goods bail the goods, a bailee may deliver the goods back to one joint owner or according to the directions of that joint owner, without the consent of the other owners. Where a bailor has no title to the goods and a bailee, in good faith, delivers the goods back to the bailor or according to the directions of the bailor, the bailee is not responsible to the owner, for the delivery.
Where a person, other than a bailor, claims bailed goods, that person may apply to the court to stop delivery of the goods to the bailor and to decide the title to the goods.
Where goods which are commonly the subject of sale are found but the owner cannot with reasonable diligence be found or where the owner refuses upon demand, to pay the lawful charges of the finder of the goods, the finder may sell the goods, where—.
Where a bailee, in accordance with the purpose of the bailment, renders any service involving the exercise of labour or skill in respect of the bailed goods, the bailee may, in the absence of a contract to the contrary, retain the goods until he or she receives the remuneration due, for the services rendered in respect of the goods.
A pledgee may retain any goods that are pledged for the payment of—. A pledgee is not entitled to receive from a pledgor extraordinary expenses incurred by the pledgee for the preservation of any pledged goods.
Where a person pledges goods in which he or she has a limited interest, the pledge is valid to the extent of that interest. In an emergency, an agent has authority to do any act for the purpose of protecting a principal from loss, as would be done by a person of ordinary prudence, under similar circumstances.
Where an agent without authority to do so, appoints a person to act as a sub-agent and stands towards that person in a relation of a principal to an agent and is responsible for the actions of that person to both the principal and a third person, the principal is not represented by or responsible for the acts of the person employed as sub-agent and that person is not responsible to the principal. Where an agent, holding an express or implied authority to name another person to act for the principal in the business of the agency, names a person to act for the principal, that person is not a sub-agent of the principal but an agent, for the part of the business of the agency that is entrusted to him or her.
In selecting another agent for a principal, an agent shall exercise the same amount of discretion as a person of ordinary prudence would exercise in a similar case; and where the agent does so, he or she is not responsible to the principal for the acts or negligence of the agent who is selected. Ratification may be express or implied by the conduct of the person on whose behalf an act is done.
A valid ratification of an act may only be made by a person whose knowledge of the facts of the case is not defective. Where a person ratifies an unauthorized act done on behalf of that person, the whole of the transaction of which the act forms a part is accordingly ratified. An act done by one person on behalf of another without the authority of that other person, which if done with authority would have the effect of subjecting a third person to damages or of terminating any right to interest of a third person, shall not by ratification, be made to have such effect.
Where the agent has an interest in the property which forms the subject matter of an agency, the agency shall not, in the absence of an express contract, be terminated to the prejudice of that interest. Subject to section , a principal may revoke the authority given to an agent at any time before the authority is exercised to bind the principal.
A principal shall not revoke the authority given to an agent after the authority is partly exercised, with respect to acts and obligations that arise from acts already done under the agency.
Where an agency is revoked or renounced, without reasonable cause, contrary to an express or implied contract that the agency is to continue for a given period of time, the principal or the agent, as the case may be, shall compensate the other party, for the revocation or renunciation of the agency.
A party who revokes or renounces an agency shall give reasonable notice to the other party to the agency and make good any damage suffered. Revocation or renunciation may be express or implied by the conduct of a principal or an agent, respectively.
The termination of the authority of an agent does not take effect before it becomes known to the agent or with regard to a third party, before it becomes known to the third party. An agent shall take all reasonable steps to protect and preserve the interests entrusted to him or her, where—. Subject to section , the termination of the authority of an agent causes the termination of the authority of a sub-agent appointed by the agent. An agent shall render proper accounts to a principal on demand.
An agent shall, in case of difficulty, use all reasonable diligence to communicate with a principal and to seek to obtain the instructions of the principal.
Where an agent deals on his or her own account in the business of the agency, without obtaining the consent of a principal and without acquainting the principal with all material circumstances which come to the knowledge of the agent on the subject, the principal may repudiate the transaction where the case shows that any material fact was dishonestly concealed from the principal by the agent or that the dealings of the agent is unfavourable to the principal.
Where an agent deals in the business of the agency without the knowledge and consent of a principal, the principal may claim from the agent any benefit which may have accrued to the agent from the transaction.
An agent shall pay to a principal, all sums received on the account of the principal, subject to deductions referred to under section 1. In the absence of any special contract, payment for the performance of any act is not to be made to an agent until the completion of that act. An agent who is guilty of misconduct in the business of the agency is not entitled to any remuneration in respect of that part of the business. In the absence of any contract to the contrary, an agent is entitled to retain the goods of a principal, whether movable or immovable, received by the agent, until the amount due to the agent for commission, disbursements and services in respect of the goods is paid or accounted for by the principal.
Where a principal employs an agent to do an act which is criminal, the principal is not liable, either upon an express or implied promise, to indemnify the agent against the consequences of that act.
A principal shall compensate an agent for any injury that may be caused to the agent by the neglect or lack of skill of the principal. A contract entered into through an agent and obligations arising from acts done by the agent under the contract shall be enforced in the same manner and have the same legal consequences as if the contract was entered into or done by a principal.
Any notice given to or information obtained by an agent in the course of the business transacted by the agent for the principal, shall, as between the principal and a third party, have the same legal consequences as if it had been given or obtained by the principal. In the absence of any contract to the contrary, an agent shall not enforce a contract entered into by him or her on behalf of a principal and shall not be bound by the contract, except where—.
Where a person makes a contract with another, without knowledge or reasonable ground to believe, that the other is an agent, the principal, if he or she requires the performance of the contract, may only obtain the performance of the contract subject to the right and obligations subsisting between the agent and the other party of the contract.
Where an agent is personally liable, a person dealing with the agent may hold the agent or principal or both of them liable.
A person who enters into a contract with an agent and induces the agent to act upon the belief that only the principal shall be held liable or who induces the principal to act upon the belief that only the agent shall be held liable, shall not hold that agent or principal, as the case may be, liable afterwards. A person who fraudulently represents himself or herself as an authorised agent of another person and induces a third person to deal with him or her as the agent, is liable to compensate the third person in respect of any loss or damage incurred, where the alleged principal does not ratify the acts.
A person who holds out as an agent shall not be entitled to require the performance of a contract, where that person was not acting as an agent but on his or her own account. Where an agent, without authority, does an act or incurs an obligation to a third person on behalf of a principal, the principal is bound by the act or obligation, where the principal by word or conduct induced the third person to believe that the act or obligation is within the scope of the authority of the agent.
The Minister may, by statutory instrument, with the approval of the Cabinet amend the Schedule to this Act. Skip to main content. Short title: Contracts Act, Part I—Preliminary. Communication of offer, acceptance or revocation.
Completion of communication. Revocation of offer or acceptance. Mode of revocation of offer. Acceptance to be absolute. Acceptance by performing conditions or receiving consideration. Express or implied promise. Agreement that amounts to a contract. Capacity to contract. Sound mind for purposes of contracting. Free consent of parties to a contract. Undue influence. Void and voidable agreements. Voidability of agreements without consent. Mistake of fact. Mistake of law. Lawful consideration or objects.
Effect of lack of or failure of consideration. Agreement in restraint of profession, trade, etc. Act 7.
Act 7 Contracts Act Section. Duty of agent in naming another agent. Ratification of acts done by person who is not an agent. Ratification may be express or implied. Knowledge requisite for valid ratification. Effect of ratifying unauthorised act. Ratification of unauthorised act does not injure third person. Termination of agency.
Termination of agency where agent has interest in subject matter. Revocation of authority of agent by principal. Revocation where authority is partly exercised. Compensation for revocation by principal or renunciation by agent. Notice of revocation or renunciation. Revocation and renunciation may be express or implied.
Termination of authority of agent. Termination of agency by death or insanity of principal.
Termination of authority of sub-agent. Duty of an agent in conducting business of principal. Skill and diligence required from agent. Accounts of an agent. Duty of an agent to communicate with principal.
Right of principal to repudiate when agent deals without consent of principal. Right of agent to retain sums received on account of principal. Duty of agent to pay sums received for principal. Remuneration of agent. Agent not entitled to remuneration for misconduct. Lien of an agent on property of principal. Indemnity of agent. Non liability of principal to agent in a criminal act.
Compensation to agent for injury caused by principal. Enforcement and consequences of contract of agent. Liability of principal where agent exceeds authority. Agent not to enforce or be bound by contracts on behalf of principal. Right of parties to a contract made by agent not disclosed. Performance of contract with agent acting as principal. Joint liability of agent and principal to a third party. Consequence of inducing agent or principal to act on belief that either will be held liable.
Liability for fraudulently holding out as agent. Person falsely contracting as agent not entitled to performance. Liability of principal inducing belief that unauthorised acts of agent were authorised.
Misrepresentation or fraud by agent. A promise may be express or implied. A promise is express, where an offer or an acceptance of a promise is made either verbally or in writing. A promise is implied, where an offer or an acceptance is not made either verbally or in writing. A contract is an agreement made with the free consent of parties with capacity to contract, for a lawful consideration and with a lawful object, with the intention to be legally bound.
A contract may be oral or written or partly oral and partly written or may be implied from the conduct of the parties. A contract is in writing where it is— in the form of a data message; accessible in a manner usable for subsequent reference; and otherwise in words.
Nothing in this Act shall affect any law in Uganda relating to contracts by corporations or generally. A contract the subject matter of which exceeds twenty five currency points shall be in writing. The parties to a contract shall perform or offer to perform, their respective promises, unless the performance is dispensed with or excused under this Act or any other law.
A promise binds a representative of a promisor, in case of the death of the promisor before performance, unless a contrary intention appears from the contract. Refusal to accept offer of performance. Where a promisor makes an offer of performance to a promisee but the offer is not accepted, the promisor is not responsible for non performance and does not lose his or her rights under the contract.
An offer shall fulfill the following conditions— it shall be unconditional; it shall be made at a time and place and under such circumstances that the person to whom it is made has a reasonable opportunity of ascertaining that the person by whom it is made is able and willing to do what he or she is bound to do by the promise; and where the offer is an offer to deliver anything to the promisee, the promisee shall have a reasonable opportunity to see that what is offered is what the promisor is bound by the promise to deliver.
An offer to one of several joint promisees has the same legal consequences as an offer to all of them. Refusal of party to perform promise.
Agreement in restraint of legal proceedings. Agreement void for uncertainty. Agreement by way of wager.
Agreement to do impossible act. Reciprocal promise to do legal and illegal acts. Alternative promise, one part being illegal. Part IV—Contingent Contracts. Contract contingent on event happening. Contract contingent on event not happening. Contract contingent on conduct of a person. Contract contingent on happening of specified event within a specified time. Agreement contingent on an impossible event. Part V—Performance of Contracts. Contracts which have to be performed.
Obligation of parties. Person to perform promise. Effect of accepting performance from third person. Joint liability and rights. Joint liability. Release of a joint promisor. Joint rights. Time and place for performance.
Time for performance. Performance of reciprocal promises. Reciprocal obligation to perform. Liability of party preventing event on which contract is to take effect. Default in the performance of reciprocal promises. Failure to perform within a fixed time. Appropriation of payments. Application of payment where debt to be discharged is indicated. Application of payment where debt to be discharged is not indicated.
Application of payment where no party appropriates. Contracts which need not be performed. Effect of novation, rescission and alteration of contract. Promisee may dispense with or remit performance of promise.
Consequence of rescission of voidable contract. Mistake is an erroneous belief concerning something. The mistake can be of two types: 1. Mistake of law 2. Void contract: According to section 2 j of the Indian Contract Act,, A contract which ceases to be enforceable by law becomes void when it ceases to be enforceable.
Void agreement: According to section 2 g , An agreement not enforceable by law is said to be void. Voidable contract: According to section 2 i of the Indian Contract Act,, A voidable contract is one which can be set aside or repudiated at the option of the aggrieved party.
An offer is also called proposal. According to section 2 a of the Indian Contract Act,, A person is said to have made the proposal when he signifies to another his willingness to do or to abstain from doing anything with a view to obtaining the assent of that offer to such act or abstinence.
Types of Offers: An offer may either be express or implied. Express Offer: an express offer is one which is made by words spoken or written. Implied Offer: an implied offer is made otherwise than in words. Specific offer: a specific offer is one which is made to a definite person or particular group of persons. General Offer: a general offer is one which is not made to a definite person, but to the world at large or public in general.
Different from a mere declaration of intention. Different from an invitation to offer. Proper communication. No term the non-compliance of which amount to acceptance. Communication of special terms. Move at the desire of the promisor. Move from any person. Of some value V. Something other than the promisors existing obligation. Promise to compensate. Promise to pay time barred debt. Completed gifts. Capacity refers to competence of the parties to enter into a valid contract.
Section 11 of the Indian Contract Act makes clear the parties who are competent to contract. Thus, section 11 declares the following persons to be incompetent to enter into a contract: a. Minors b. Persons of unsound mind c. Persons disqualified from contracting by the law to which they are subject. Validity 2. No Estoppel 3. Co-sureties liable to contribute equally Delivery to bailee how made Care to be taken by bailee Bailee when not liable for loss, etc.
Termination of bailment by bailee's act inconsistent with conditions Liability of bailee making unauthorised use of goods bailed Effect of mixture, with bailor's consent, of his goods with bailee's Effect of mixture, without bailor's consent, when the goods can be separated Effect of mixture, without bailor's consent, when the goods cannot be separated Repayment by bailor of necessary expenses Restoration of goods lent gratuitously Return of goods bailed on expiration of time or accomplishment of purpose Bailee's responsibility when goods are not duly returned Termination of gratuitous bailment by death Bailor entitled to increase or profit from goods bailed Bailor's responsibility to bailee Bailment by several joint owners Bailee not responsible on re-delivery to bailor without title Right of third person claiming goods bailed Right of finder of goods; may sue for specific reward offered When finder of thing commonly on sale may sell it Bailee's particular lien General lien of bankers, factors, wharfingers, attorneys and policy- brokers Bailments Of Pledges Pawnee's right of retainer Pawnee not to retain for debt or promise other than that for which goods pledged Presumption in case of subsequent advances Pawnee's right as to extraordinary expenses incurred Defaulting pawnor's right to redeem Pledge by mercantile agent A.
Pledge by person in possession under voidable contract Pledge where pawnor has only a limited interest Suits by Bailees or Bailors against Wrong-doers Suit by bailor or bailee against wrong-doer Who may employ agent Who may be an agent