DEFINE CONTRACT WHAT ARE THE ESSENTIALS OF A VALID CONTRACT.

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MAQSOOD AHMED

CAREER ACADEMY

: Define contract, what are the essentials of a valid contract?

Ans. Introduction: A contract is a legally binding agreement or relationship that exists between two or more parties to do or abstain from doing certain acts. A contract can also be defined as a legally binding exchange of promises between two or more parties that they will enforce. For a contract there must be an offer from one party and its acceptance from the other party with some consideration. Both parties involved must intend to create legal relation on a lawful matter which must be entered into freely and should be possible to perform

Definition: According to Sir Frederick Pollock,

“Every agreement and promise enforceable by law is a contract”

Sec. 2(h) of Contract Act 1872

“An agreement enforceable at law is a contract”

An agreement becomes enforceable by law when it fulfills some conditions. These conditions may be called as the essentials of a valid contract.

According to sec.10

“All agreements are contracts if they are made by the free consent of the parties competent to contract for a lawful consideration with a lawful object, and are not hereby expressly declared to be void”

Following are the essentials of a valid contract in detail.

1-Agreement:

Two parties, one making an offer and the other accepting it. Acceptance must be unconditional and in the same mode as prescribed and communicated by the offeror. To constitute a valid contract there must be “consensus ad idem”.(same thing in the same sense)

Example: A offer B to sell his car for Rs.500000. B agrees to buy it. This is an offer by A and acceptance by B

2-Legal relationship:

Parties must intend to create legal relationship. It arises when parties know that if one of them does not fulfill his part of promise, he shall be liable for the failure of the contract. (Balfour vs Balfour)

Example: Asif offers to sell his phone to Alvi for Rs. 1000. Alvi agrees to buy. It is a contract as it creates legal relationship.

3-Lawfull object: (sec.23 ) The object of the contract must be lawful.

Under section 23, “Every agreement of which the object or consideration is unlawful is void”

The object must not be:

1. Illegal or unlawful,

2. Immoral,

3. Opposed to public policy.

Object must not be forbidden by law or is of such a nature that if permitted it will defeat the provisions of law, imputes injury to the person or property of another.

Example: Hamid agrees to pay Asif Rs.20000 if he kills Ali. The agreement is illegal as the object is unlawful.

4-Free consent (13)

Two or more parties are said to be consent when they are agreed upon the same thing in the same sense. This emphasizes the need of consensus ad idem. Free consent is absent if contract is induced by coercion, misrepresentation, fraud, undue influence etc.

Example: A compels B to enter into a contract on gun point. It is not a valid contract because consent is not free.

5-Capacity of parties: (sec. 11)

Every person is competent to contract if he is of the age of majority, is of sound mind and is not disqualified from contracting by law to which he is subject.

Example: M, a minor agrees to sell his house to B. It is not a valid contract because he is not competent to make a contract.

6-Lawful consideration:

Consideration is something in return. It is the doing of or abstinence from an act. It is the price paid by one party for the promise of the other. It means that contract is only valid if both the parties get something and give something.

Example: A agrees to sell his car for Rs. 50000 to B. For A the consideration is Rs.500000 and for B consideration is car.

The consideration or object of an agreement is unlawful if….

1-It is forbidden by law,

2-If permitted; it would defeat the provisions of any law,

3-Involes injury to any other person or property,

4-It is fraudulent, or

5-It is opposed to public policy.

7-Agreement is not expressly declared to be void:

A void agreement is not enforceable. It has no legal existence neither it gives rise to any rights or obligations. In order to make a valid contract must not be one of those that are expressly declared to be void.

Examples of void agreements

-                       a- Agreement in restraint of marriage.

b- Agreement in restraint of legal proceedings.

c- Agreement in restraint of trade.

d- Agreement to do impossible acts.

e- Agreement by way of wager.

8-Possibility of performance:

A contract must be possible to perform otherwise it will not be a valid contract.

Section 56 says that “An agreement to do an act impossible in itself is void”.

Example: An agreement to put the life into a dead body is void as it is not possible.

9-Certainty of terms:

The contract must not be uncertain, vague or indefinite. Where the agreement is vague and its meaning can not be understood, it shall be unenforceable.

According to section 29, Agreement, the meaning of which is not certain or capable of being made certain, is void.

Example: A agrees B to sell one ton of oil without informing the kind of oil. The agreement is void because of its uncertainty.

10-Legal formalities:

Legal formalities should also be fulfilled regarding

1. Writing
2. Registration
3. Attestation etc.

Example: Sale and purchase of land requires registration.

CONCLUSION:

If any of the essential elements is missing the contract is voidable, void, illegal or unenforceable in the eyes of law.

FREE CONSENT

MAQSOOD AHMED

Career Academy HFD

0.33.33.42.42.00

Q-What is free consent? Discuss the elements and position of contract when consent is not free.
Ans.

According to sec. 10

“All agreements are contracts if they are made by the free consent of the parties”

Consent defined

Sec. 13 explains free consent as

” Two or more parties are said to consent when they agree upon the same thing in the same sense”

Free consent

According to sec. 14

Consent is said to be free when it is not caused by:

1. Coercion sec. 15
2. Undue influence sec16
   
3. Fraud sec.17
4. Misrepresentation sec.18
5. Mistake sec. 20, 21, 22.

Example: A threatens to shoot M, if he does not give his house on rent. M agrees. The consent of M is not free.

Elements of affecting consent

                                              Coercion sec.15 defines as:

Coercion is the committing or threatening to commit, any act forbidden by the Pakistan Penal Code or the 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”

Example: Consent obtained at the point of pistol, by threatening to hurt someone

Explanation to this section:

It is immaterial whether the Pakistan Penal Code is or is not in force in the place where the coercion is employed.

Effect of coercion:

Section 19 points out that a contract induced by coercion is voidable at the option of the party whose consent was obtained through coercion.

Undue influence sec.16 (1) defines as

A contract is said to be induced by undue influence where the relation subsisting between the parties are such that one of the parties is in a position to dominate the will of the other and uses that position to obtain unfair advantage over the other”

Dominating position sec.16(2)

A person is deemed to be in a position to dominate the will of another..

a- When he holds a real or apparent over the other or he stands in a fiduciary relation to the other,

b-When he makes a contract with a person whose mental capacity is temporarily or permanently affected by reason of age, illness, or mental or bodily distress.

Example: A , a spiritual adviser induced his follower M , to gift him his house secure Jannat. It was held that gift was obtained by undue influence as A was in a position to dominate.

Effect of undue influence

Where consent to an agreement is caused by undue influence, the agreement is a contract voidable at the option of the part whose consent was so obtained. Any such contract may be set aside absolutely or if the party who is entitled to avoid it has received any benefit, upon such terms and conditions as the court may consider just and equitable.

                                                 Fraud (Sec.17)

Section 17 says “Fraud means and includes any of the following acts committed by a party to a contract, or with his connivance, or by his agent

, with an intention to deceive another party thereto or his agent or to induce him to enter into the contract….

1. the suggestion, as a fact of that which is not true, by one who does not believe it to be true;
2. the active concealment of a fact by one having knowledge or belief of the fact;
3. a promise made without any intention of performing it;
4. any other act fitted to deceive:
5. any such act or omission as the law specially declares to be fraudulent.

Example: A sells a house to B. The house has cracked walls. A fills it up to conceal the defect. B can not find the defect. A is guilty of fraud.

Consequences of fraud

The following remedies are available to the aggrieved party:

1. He can avoid the contract.
2. He can sue for damages.
3. He can ask for specific performance and restoration.

                                         4. Misrepresentation ( sec.18)

According to section 18, Misrepresentation means and includes….

1. the positive assertion, in a manner not warranted by the information of the person making it, of that which is not true, though he believes it to be true;
2. any breach of duty which, without an intent to deceive, gains advantage to the person committing it, or any one claiming under him, by misleading another to his prejudice or to the prejudice of any one claiming under him,
3. causing ,however innocently, a party to an agreement to make a mistake as to the substance of the thing which is the subject of the agreemen

Effect of Misrepresentation

1. Aggrieved party can avoid the contract.
2. Party can accept the contract but ask the other party for restoration.

                                              5. Mistake

It is necessary for the creation of a valid contract that both the parties to the contract should agree to the same thing in the same sense and consent is freely given. Where the parties give their consent under any error, there is no agreement at all. Mistake is of two kinds:

(1) Mistake of fact

(2) Mistake of law.

Example A and B make a contract grounded on the erroneous belief that a particular debt is barred by the Pakistan Laws of Limitation, the contract is not voidable.

Effect of mistake

Section 20 says “Where both the parties to an agreement, are under a mistake as to matter of fact essential to the agreement, the agreement is void.

Section 21 says “A contract is not voidable because it was caused by a mistake as to any law in force in Pakistan but a mistake as to law not in force in Pakistan has the same effect as a mistake of fact.

Section 22 says “A contract is not voidable merely because it was caused by one of the parties to the contract being under a mistake as to a matter of fact. Ended

973 words

BUSINESS LAW, Powers & functions of national industrial relation commission

Q. what are the powers and functions of National Industrial Relation Commission? Discuss in detail.

Introduction:

Commission is a body of persons to run and implement the procedures of industrial relations ordinance 2002.The Federal Government shall constitute a National Industrial Relations Commission consisting of eight members including its chairman. The Federal Government shall appoint the chairman and its members .The Federal Government shall determine the qualification and terms and conditions of service for appointment as chairman and member of the commission. (sec.49)

Powers and Functions of the Commission.

Following are the functions and powers of the Commission:

1. Adjudication of disputes
   .To adjudicate and determine an industrial dispute that is of national importance referred by the federal government.
2. Registration of trade unions.
   To register industry wise trade union, federation of trade unions and federations at the national level.
3. Ratings of trade unions.
   To carry out ratings of the trade unions and federations registered by it in terms of their standing and character.
4. Determination of CBA.
   To determine the collective bargaining agents amongst industry wise Trade unions and federations at the national level.
5. Advisory services.
   To advise Government, Trade unions and federations in respect to the education of workers in essentials of the Trade unionism.
6. Worker education.
   To educate the workers in respect of their rights and obligations and to secure the provision of facilities.
7. Promotion of unionism. 
   To promote healthy Trade unionism in establishments within a province and federations of Trade unions.
8. Facility center.
   To facilitate the formation of federations at national level.
9. Unfair labour practices.
   To deal with cases of unfair practices on the part of the employer, workmen.
10. Check on CBA.
    To deal with cases of unfair practices on the part of collective bargaining agent and Trade unions or their agents.
11. Prevention of unfair labour practices.
    To take measures to prevent an employer or workmen from committing an unfair labour practice.
12. Offences.
    To try offences in respect of matters to any of its functions.
13. Punishment.
    The commission shall have power to punish any person who obstructs its processes or disobeys its orders and directions.
14. Prosecution.
    The commission may initiate prosecution, trial, action or proceedings with regard to any matter relating to its functions.
15. Authority delegation.
    The commission for the purpose of an investigation or inquiry may authorize its chairman or any member to enter any building, factory etc. and inspect, interrogate and report.
16. Withdrawl of cases.
    The commission may on the application of the party or on its own motion, withdraw any case of unfair labour practice from the labour courts.
17. Seizure of cases.
    To deal the unfair labour practice of which the commission is seized, the commission may,

1. proceed directly with the case,
2. ask the registrar to enquire into it and report.
3. refer the case to labour court for report or for disposal.

18. Assigned powers.
    To exercise other powers and functions, assigned by the federal government from time to time.
    19.Power to make regulations.
    The Commission may, with the prior approval of the Federal Government, make such regulations relating to its procedure and the performance of its functions as it may deem fit.
    20. Power to demand reports. 
    Commission may order to labour court to enqiure into any case and submit a report about the matters.
    21. Formation of benches.
    For the efficient perfomance of the functions of the commission, the chairman of the commission shall  form various benches of the ccommission on the behalf of the commission.
    22. General powers and functions.
    The commission has general powers and functions to regulate, maintain and run the procedures of industrial commission ordinance. 

Finality of Order:

The order passed by the commission  or any of its Benches shall not be called in question in any court, and such order, decision, judgment or sentence passed by the Commission shall be final.( 53)

BUSINESS LAW, Remedies for breach of contact

Q. What remedies are available to an aggrieved party on the breach of a contract?

Introduction:

Breach of contract means failure to perform any written or oral term of the contract without any legtimate legal excuse. This may include not completing a job, not paying in time, failure to deliver the goods, being late  or any act which shows that the party will not complete his part of promise. Breach may be actual or anticipatory with respect to time. It may be Minor or Major with respect to terms and conditions.

Suppose a homeowner hires a contractor to install new plumbing and insists that the pipes, which will ultimately be hidden behind the walls, must be red. The contractor instead uses blue pipes that function just as well. Although the contractor breached the literal terms of the contract, the homeowner cannot ask a court to order the contractor to replace the blue pipes with red pipes. The homeowner can only recover the amount of his  actual damages. In this instance, this is the difference in value between red pipe and blue pipe. Since the color of a pipe does not affect its function, the difference in value is zero. Therefore, no damages have been incurred and the homeowner would receive nothing. (See Jacob & Youngs v. Kent.)

The following are the remedies available to an aggrieved party on breach of contract.

1. Suit for Rescission
2. Suit for damages.
3. Suit upon quantum meruit.
4. Suit for specific performance.
5. Suit for injunction.

1. Rescission.

In contract law, rescission has been defined as the unmaking of a contract between parties. This is done to bring the parties, as far as possible, back to the position in which they were before they entered into a contract (the status quo ante).
Rescission is an equitable remedy and is discretionary.  Because rescission is supposed to be imposed mutually upon both sides to a contract, the party seeking rescission normally must offer to give back all benefits he has received under the contract.

If a party rightfully rescinds the contract, he is entitled to compensation by the other party for any damages which he was sustained through the non-fulfillment of the contract.

Example:

A contract to supply cotton to B on 12 dec. B agrees to pay the price on receipt of cotton. A doe not supply on due date. B is discharged from liability to pay. B can rescind and claim damages.

The court may grant rescission:

1. Where the contract is voidable by the plaintiff.
2. Where the contract is unlawful not apparent on its face and defendant is more to be blamed than the plaintiff.

The court may refuse to grant rescission:

1. The plaintiff expressly or impliedly ratified the contract.
2. owning to change in circumstances, the parties can not be restored to their original position
3. In the meanwhile, the third parties have acquired rights in good faith for value.

2. Suit for damages:

It is a monetary compensation awarded to the injured party for loss faced by him. The object of awarding damages is to put the injured partying the same financial position in which they would have if there were no breach.

Kinds of damages:

Ordinary Damages.

Damages which naturally arose in the usual course of things from such breach. In a contract of sale of goods, the damages payable are the difference between the contract price and the market price at the date of breach (73)

Special Damages.

Such damages must be in the contemplation of parties at the time when the contract is made if there are some special circumstances which would result in special loss in case of breach of contract. Such special circumstances must be brought to the knowledge of the other party. If there is breach of contract, special damages can be claimed.

Nominal Damages.

Nominal means very small in amount. When the injured party has not in fact suffered any loss due to breach of contract, the damages recoverable from the guilty party are called nominal damages.

Liquidated Damages.

When parties to the contract fix the amount of damages for the breach of contract at the time of formation of the contract, such damages are called liquidated damages. The court will not allow damages more than agreed amount. If the actual loss is more than the agreed amount, damages will be payable to the agreed amount.

Such damages do not form a part of law of contract. These are awarded to punish the guilty party for the breach of contract.

3. Quantum Meruit:

It means ‘as much as is merited. In simple words, it is reasonable value of work done. Where a person has done some work under when a contract and other party cancel the contract or contract becomes void, such party can claim remuneration for the work already done. The right to claim for quantum meruit arises when the original contract is discharged.

Claim on quantum meruit arises from the following:

1. When the contract is discovered to be void.
2. Where something has been done
3. When one party refuses to perform the contract.
4. Where the contract is divisible.

4. Specific Performance:

Specific performance means to do the job as agreed upon. When damages are not adequate remedy court may direct the guilty party to carry out his promise according to the terms of the contract.

Specific performance is granted in the following cases:

1. When compensation in money is not an adequate relief.
2. When there is no standard for calculating the actual damage caused by the non-performance.
3. When the compensation can not be obtained.

Specific performance shall not be granted in the following cases:

1. Where the contract is of personal nature.

2. Where the contract is uncertain.

3. Where court can not supervise its carrying out.

4. Where damages are adequate remedy.

5. Injunction:

It is an order of court restraining a person from doing some act. It is a mode of securing specific performance in negative terms. The court by issuing injunction restrains a person from doing what he has promised not to do. It is a preventive measure that is suitable in anticipatory breach.

Example: (Warner bros. vs nelson)

A film actress agreed to act exclusively for WB for two years and not for anyone else. But during this period, she contracted to act for z also. Held, she could be restrained by injunction from doing so. end

Nonverbal communication

Nonverbal communication is usually understood as the process of communication through sending and receiving wordless (mostly visual) messages - i.e., language is not the only source of communication, there are other means also. Messages can be communicated through gestures and touch (Haptic communication), by body language or posture, by facial expression and eye contact. Meaning can also be communicated through object or artifacts (such as clothing, hairstyles or architecture). Speech contains nonverbal elements known as paralanguage, including voice quality, rate, pitch, volume, and speaking style, as well as prosodic features such as rhythm, intonation and stress. Dance is also regarded as a form of nonverbal communication. Likewise, written texts have nonverbal elements such as handwriting style, spatial arrangement of words, or the physical layout of a page and removal of things.
However, much of the study of nonverbal communication has focused on face-to-face interaction, where it can be classified into three principal areas: environmental conditions where communication takes place, the physical characteristics of the communicators, and behaviors of communicators.

History

The first scientific study of nonverbal communication was Charles Darwin's book The Expression of the Emotions in Man and Animals (1872). He argued that all mammals show emotion reliably in their faces.

Universality

Paul Ekman's influential 1960s studies of facial expression determined that expressions of anger, disgust, fear, joy, sadness and surprise are universal.

Clothing and bodily characteristics

Elements such as physique, height, weight, hair, skin color, gender, odors, and clothing send nonverbal messages during interaction.
Physical environment
Environmental factors such as furniture, architectural style, interior decorating, lighting conditions, colors, temperature, noise, and music affect the behavior of communicators during interaction. The furniture itself can be seen as a nonverbal message

Proxemics: physical space in communication

Proxemics is the study of how people use and perceive the physical space around them. The space between the sender and the receiver of a message influences the way the message is interpreted The perception and use of space varies significantly across cultures and different settings within cultures. Space in nonverbal communication may be divided into four main categories: intimate, social, personal, and public space.

Chronemics: time in communication

Chronemics is the study of the use of time in nonverbal communication. The way we perceive time, structure our time and react to time is a powerful communication tool, and helps set the stage for communication. Time perceptions include punctuality and willingness to wait, the speed of speech and how long people are willing to listen. The timing and frequency of an action as well as the tempo and rhythm of communications within an interaction contributes to the interpretation of nonverbal messages. Gudykunst & Ting-Toomey (1988) identified 2 dominant time patterns

Monochronic Time

A monochronic time system means that things are done one at a time and time is segmented into precise, small units. Under this system time is scheduled, arranged and managed.
Monochronic cultures include Germany, Canada, Switzerland, United States, and Scandinavia.

Polychronic Time

A polychronic time system is a system where several things can be done at once, and a more fluid approach is taken to scheduling time.
Polychronic cultures include Saudi Arabia, Egypt, Mexico, Philippines, India, and many in Africa.

Movement and body position

Kinesics

The term "Kinesics" was first used (in 1952) by Ray Birdwhistell, an anthropologist who wished to study how people communicate through posture, gesture, stance, and movement Posture
Posture can be used to determine a participant’s degree of attention or involvement, the difference in status between communicators, and the level of fondness a person has for the other communicator. Studies investigating the impact of posture on interpersonal relationships suggest that mirror-image congruent postures, where one person’s left side is parallel to the other person’s right side, leads to favorable perception of communicators and positive speech; a person who displays a forward lean or a decrease in a backwards lean also signify positive sentiment during communication.[6] Posture is understood through such indicators as direction of lean, body orientation, arm position, and body openness.

Gesture

A gesture is a non-vocal bodily movement intended to express meaning. They may be articulated with the hands, arms or body, and also include movements of the head, face and eyes, such as winking, nodding, or rolling ones' eyes. The boundary between language and gesture, or verbal and nonverbal communication, can be hard to identify. A single emblematic gesture can have a very different significance in different cultural contexts, ranging from complimentary to highly offensive.

[ Haptics: touching in communication

A high five is an example of communicative touch.

Haptics is the study of touching as nonverbal communication. Touches that can be defined as communication include handshakes, holding hands, kissing (cheek, lips, hand), back slapping, high fives, a pat on the shoulder, and brushing an arm.These behaviors are referred to as "adapter" or "tells" and may send messages that reveal the intentions or feelings of a communicator. The meaning conveyed from touch is highly dependent upon the context of the situation, the relationship between communicators, and the manner of touch.
 Touching is treated differently from one country to another and socially acceptable levels of touching vary from one culture to another.
Striking, pushing, pulling, pinching, kicking, strangling and hand-to-hand fighting are forms of touch in the context of physical abuse.

Eye gaze

The study of the role of eyes in nonverbal communication is sometimes referred to as "oculesics". Eye contact can indicate interest, attention, and involvement. Studies have found that people use their eyes to indicate their interest and with more than the frequently recognized actions of winking and slight movement of the eyebrows. Eye contact is an event when two people look at each other's eyes at the same time. It is a form of nonverbal communication and has a large influence on social behavior. Frequency and interpretation of eye contact vary between cultures and species. Eye aversion is the avoidance of eye contact. Eye contact and facial expressions provide important social and emotional information. People, perhaps without consciously doing so, probe each other's eyes and faces for positive or negative mood signs.[8] Gaze comprises the actions of looking while talking, looking while listening, amount of gaze, and frequency of glances, patterns of fixation, pupil dilation, and blink rate.[10]

Paralanguage: nonverbal cues of the voice

Paralanguage (sometimes called vocalics) is the study of nonverbal cues of the voice. Various acoustic properties of speech such as tone, pitch and accent, collectively known as prosody, can all give off nonverbal cues. Paralanguage may change the meaning of words.

 Functions of nonverbal communication
Argyle (1988) concluded there are five primary functions of nonverbal bodily behavior in human communication:[14]

• Express emotions
• Express interpersonal attitudes
• To accompany speech in managing the cues of interaction between speakers and listeners
• Self-presentation of one’s personality
• Rituals (greetings)
  

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DEFINE CONTRACT, WHAT ARE THE VARIOUS TYPES OF CONTRACTS.

  Definition:
                Literally: The word contract comes from a Latin word"Contractus" which means consent, agreement or to enter into an agreement with a particular person.
Traditionally: Salmond says , "A contract is an agreement creating and defining obligations between the parties"
Sir John Smith says,"A voluntary, deliberate and legally binding agreement between competent parties."
Example: Asif says to Hamid,"Will you purchase my car for Rs.500000?.it is an offer, Hamid says yes, the offer is accepted and a contract is formed.

The contracts can be classified into four categories:

1. According to enforceability
2. According to formation
3. According to performance

   4.  According to parties 


  ACCORDING TO ENFORCEABILITY:

According to enforceability, a contract can be divided as under:
a- Valid contract.----
                            A valid contract is enforceable by law. An agreement becomes enforceable when all the essentials of a valid contract are present.

Obligation of the parties. 
                                         In one valid contract, all the parties are legally bound for the performance of the contract. If one of the parties breaches the contract
,the other party can enforce it through the court of law.
Example:
              A agrees to sell his car to B. If it fulfills all the essentials of a contract, it is a valid contract. If A fails to deliver the car, B can him and if B fails to pay, A can sue him.

 b- Void contract:
                            The word void means not binding in law. Section 2(j) defines"A contract which ceases to be enforceable by law becomes void, when it ceases to be enforceable" It means that void contract is not void from beginning. It s valid  contract when it is made but subsequently it becomes void due to certain reasons.

Obligation of parties. (MAQSOOD AHMED, B.COM, ACMA, 03333424200)
                                  In a void contract both the parties are not bound to fulfill the contract. Under this contract the party who has received any benefit is bound to return to the other party.
                                   A contract becomes void under the following circumstances:
1. Impossibility of performance.
2. Subsequent illegality.
3. Rejection of voidable contract.
4. Impossibility of depending event.

Voidable contract:
                            " An agreement which is enforceable by law at the option of  one or more of the parties thereto, but not at option of the other or others, is a voidable contract."
Example: A promises to sell his car to B for rupees 100000.Hi consent is obtained
 by fraud.The contract is voidable at the option of A. He may avoid the contract or elect to be bound by it.

A contract becomes voidable due to following reasons:
1. A  contract is voidable when consent is not free.
2. In case of attempted performance, the contract is voidable at the option
     of promiser.
3. When the promiser fails to perform the contract within specified time, contract   is voidable at the option of promisee.

Obligation of the parties.
                                        It is a valid contract if it is not rejected by the party having the right to reject it. If the aggrieved party avoids the contract, he must restore the benefit received and it can claim damages from the other party.

Unenforceable contact:
                                     It is a contract which can not be enforced in court of law because of some technical defects such as absence of writing, registration, attestation or stamp etc. It can be enforced when defects are removed. The aggrieved party is not entitled to legal remedies.
Example. Ali borrows Rs. one million from Baber makes a promissory note on a Rs.10 stamp paper. It is unenforceable because note is undervalued.
Obligation of parties.  NO party is legally bound to perform the contract.

According to formation:
                               According to formation, a contracts has following three kinds.
Express contracts:
                              Where the offer and acceptance of an y promise is made in words spoken or written, the promise is said to be express. An express promise results in an express contract.
Example. ASIF tells through email to HAMID that he wants to sell his house and Hamid informs that he agrees to buy the house, it is an express contract.

Implied contract:
                            Contracts which are inferred from the acts or conduct of the parties or due to course of dealing or circumstances are called implied contracts.
According to section 9, "where the proposal and acceptance of any promise is made otherwise than words, the promise is said to be implied."
Example. A went to a tea cafe and had a cup of tea. It is an implied contract and A will pay for the cup of tea.

Quasi contract:
                        A quasi contract is created by law and is termed as "certain relations resembling those of contracts" It rests on the principle of equity that no person shall be allowed to enrich himself unjustly at the expense of another.
Example. A, finds lost bag of B. A is bound to return the bag to B.

According to performance:
          According to performance, a contracts is of two kinds

Executed contract:
                              An executed contract is one in which both the parties to a contract have performed their respective obligations. It means nothing remains to be done.
Example. A paints a picture for B, and B pays for the picture.

Excutory contract:
The contract is executed where both the parties to a contract have yet to perform their obligation under the contract, it s an executory contract.
Example. A agrees to paint a picture for B and B agrees to pay him Rs. 500. The contract is executory.

According to parties:
                                 According to parties, a contract is of two kinds.
Unilateral contract:
                               In a unilateral contract only one party makes a commitment. It is a contract where only one party is bound but the other party chooses to be bound by it.
Example. A promises to Rs. 1000 to any one who finds his lost bag. B finds the bag and returns it to A. It is a unilateral contract which comes into existence when the is found.

Bilateral contract:
                             A bilateral contract is one in which both he parties  to the contract have yet to perform the obligations arising out of contract.
Example. A promises to make bed for B and B promises to pay Rs. 10000 to A.

DEFINE BREACH OF CONTRCT. WHAT ARE THE REMEDIES AVAILABLE TO AN AGRIEVD PARTY.

INTRODUCTION:
                          Breach of contract occurs where a party to a contract fails to perform precisely and exactly his obligation under the contract without any legitimate legal excuse.This may include not completing a job, not paying in full or on time,failure to deliver the goods etc.
          With respect to time, breach of contract may be anticipatory or actual.
Actual beach occurs where one party refuses to perform his obligation on due date or performs incompletely.
  Anticipatory breach occurs where one party announces,in advance of the due date,that he intends not to perform his obligation.

Effect of breach:
                           A breach of contract,no matter what form it may take, always entitles the innocent party to maintain an action for damages.
 
The innocent party has two options:
1. He may elect to treat the contract as still valid, complete his obligation and sue for payment from other side.
2. He may treat the contract as discharged and bring a action for damages for breach o contract immediately.

                 INTRODUCTION TO REMEDIES FOR BREACH OF CONTRACT
          Damages is the basic remedy available for breach of contract. The object of damages is to put the injured party into the same financial position he would have been in had had the contract been properly performed.Sometimes damages is not an adequate remedy and this is where the equitable remedies may be awarded.

The following are the remedies available to an aggrieved party on breach of contract.

1. Rescission of the contract.
2. Suit for damages.
3. Suit upon quantum meruit.
4. Suit for specific performance.
5. Suit for injunction.

1. Rescission.

When one of the parties to a contract commits breach, the other party may treat the contract as rescinded and is absolved of all obligations under the contract.

When a party treats the contract as rescinded, he makes himself liable to restore any benefit that he has received under the contract from the other party.

If a party rightfully rescinds the contract, he is entitled for compensation by the other party for any damage which he was sustained through the non-fulfillment of the contract.

Example:

A contract to supply cotton to B on 12 dec. B agrees to pay the price on receipt of cotton. A doe not supply on due date. B is discharged from liability to pay. B can rescind and claim damages.

The court may grant rescission:

1. Where the contract is voidable by the plaintiff.
2. Where the contract is unlawful not apparent on its face and defendant is more to be blamed than the plaintiff.

The court may refuse to grant rescission:

1. The plaintiff expressly or impliedly ratified the contract.
2. owning to change in circumstances, the parties can not be restored to their original position
3. In the meanwhile, the third parties have acquired rights in good faith for value.

2. Suit for damages:

It is a monetary compensation awarded to the injured party for loss faced by him. The object of awarding damages is to put the injured partying the same financial position in which they would have if there were no breach.

Kinds of damages:

Ordinary Damages.

Damages which naturally arose in the usual course of things from such breach. In a contract of sale of goods, the damages payable are the difference between the contract price and the market price at the date of breach (73)

Special Damages.

Such damages must be in the contemplation of parties at the time when the contract is made if there are some special circumstances which would result in special loss in case of breach of contract. Such special circumstances must be brought to the knowledge of the other party. If there is breach of contract, special damages can be claimed.

Nominal Damages.

Nominal means very small in amount. When the injured party has not in fact suffered any loss due to breach of contract, the damages recoverable from the guilty party are called nominal damages.

Liquidated Damages.

When parties to the contract fix the amount of damages for the breach of contract at the time of formation of the contract, such damages are called liquidated damages. The court will not allow damages more than agreed amount. If the actual loss is more than the agreed amount, damages will be payable to the agreed amount.

Such damages do not form a part of law of contract. These are awarded to punish the guilty party for the breach of contract.

3. Quantum Meruit:

It means ‘as much as is merited. In simple words, it is reasonable value of work done. Where a person has done some work under when a contract and other party cancel the contract or contract becomes void, such party can claim remuneration for the work already done. The right to claim for quantum meruit arises when the original contract is discharged.

Claim on quantum meruit arises from the following:

1. When the contract is discovered to be void.
2. Where something has been done
3. When one party refuses to perform the contract.
4. Where the contract is divisible.

4. Specific Performance:

Specific performance means to do the job as agreed upon. When damages are not adequate remedy court may direct the guilty party to carry out his promise according to the terms of the contract.

Specific performance is granted in the following cases:

1. When compensation in money is not an adequate relief.
2. When there is no standard for calculating the actual damage caused by the non-performance.
3. When the compensation can not be obtained.

Specific performance shall not be granted in the following cases:

1. Where the contract is of personal nature.

2. Where the contract is uncertain.

3. Where court can not supervise its carrying out.

4. Where damages are adequate remedy.

5. Injunction:

It is an order of court restraining a person from doing some act. It is a mode of securing specific performance in negative terms. The court by issuing injunction restrains a person from doing what he has promised not to do. It is a preventive measure that is suitable in anticipatory breach.

Example: (Warner bros. vs nelson)

A film actress agreed to act exclusively for WB for two years and not for anyone else. But during this period, she contracted to act for z also. Held, she could be restrained by injunction from doing so. end