28 February, 2016

DISCHARGE OF A CONTRACT

Discharge is the process whereby the primary objectives and obligations under a contract, which is validly formed, come to an end. A contract may be discharged either by an Act of the parties or by an operation of law in the different base set out below:
i)       Discharge by performance:- It takes place when the parties to the contract fulfil then -obligations arising under the contract within the time and in the manner prescribed. Discharge by performance may be (1) actual performance or (2) attempted performance. Actual performance is said to have taken place, when each of the parties has done what he had agreed to do under the agreement. When the promisor offers to perform his obligation, but the promisee refuses to accept the performance, it amounts to attempted performance or tender.
ii)    Discharge by mutual agreement:- Section 62 of the Indian Contract Act provides if the parties to a contract agree to substitute a new contract for it, or to refund or remit or alter it, the original contract need not be performed. The principal of Novation, Rescission, Alteration and Remission are already discussed in para 4.12.
iii)  Discharge by impossibility of performance:- The impossibility may exist from the very start. In that case, it would be impossibility ab initio. Alternatively, it may supervene. Supervening impossibility may take place owing to: (a) an unforeseen change in law, (b) the destruction of the subject-matter essential to that performance; (c) the non-existence or non-occurrence of particular state of things, which was naturally contemplated for performing the contract, as a result of some personal incapacity like dangerous malady; (e) the declaration of a war (Section 56)
iv)   Discharge by lapse of time:- A contract should be performed within a specified period as prescribed by the Limitation Act, 1963. If it is not performed and if not action is taken by the promising within the specified period of limitation, he is deprived of remedy at law. For example, if a creditor does not file a suit against the buyer for recovery of the price within three years, the debt becomes time-barred and hence irrecoverable.
v)      Discharge by operation of law:- A contract may be discharged by operation of law which includes by death of the promisor, by insolvency etc.
vi)  Discharge by breach of contract:- Breach of contract may be actual breach of contract or anticipatory breach of contract. If one party defaults in performing his part of the contract on the due date, he is said to have committed breach thereof. When on the other hand, a person repudiates a contract before the stipulated time for its performance has arrived, he is deemed to have committed anticipatory breach. If one of the parties to a contract breaks the promise the party injured thereby, has not only a right of action for damages but he is also discharged from performing his part of the contract (Section 64)
vii) A promise may dispense with or remit the performance of the promise made to him or 'I may accept any satisfaction he thinks fit. In the first case, the contract will be discharged by remission and in the second by accord and satisfaction (Section 63).
viii) When a promise neglects or refuses to afford the promisor reasonable facilities for the performance of the promise, the promisor is excused by such neglect or refusal (Section 67).

Courtesy:- Legal Point Foundation

LIABILITY OF JOINT PROMISORS

If two or more persons have made a joint promise, ordinarily all of them during their life-time must jointly fulfill the promise. After death of anyone of them, his legal representative jointly with the survivor or survivors should do so (See. 42). After the death of the last survivor the legal representatives of all the original co-promisors must fulfil the promise. For example, X, Y and Z who had jointly borrowed money must, during their life-time jointly repay the debt. Upon the death of X his representative, say, S along with Y and Z should jointly repay the debt and so on. This rule is applicable only if the contract reveals no contrary intention.
We have seen that Section 42 deals with voluntary discharge of obligations by joint promisors. But if they do not discharge their obligation on their own volition, what will happen? This is what Section 43 resolves. Accordingly,
(i) when two or more persons make a joint promise, the Promisee may, in the absence of express agreement to the contrary, compel anyone or more of such joint promisors to perform the whole of the promise.
(ii) If one of the joint promisors is made to perform the whole contract, he can call for a contribution from others. For example, A, B and C jointly execute a promissory note for Rs. 3,000 in favour of D. A is compelled to pay the whole amount. A, in such a case would be able to realise Rs. 1,000 each from B and C. This rule may, however, be modified by mutual agreement between the joint Promisors
(iii) If any of the joint promisors makes a default in making his contribution the remaining joint promisors must bear the loss arising from such a default in equal shares. In the above example, where A, B and C jointly executed the promissory note for Rs. 3,000 and if C was unable to pay anything, then A would be able to realise from B by way of contribution Rs. 1,500 instead of Rs. 1,000.
We thus observe that the effect of Section 43 is to make the liability in the event of a joint contract, both joint & several, in so far as the promisee may, in the absence of a contract to the contrary, compel anyone or more of the joint promisors to perform the whole of the promise. The effect of release of one of the joint promisors is dealt with in Section 44 which is stated below:
Where two or more persons have made a joint promise, a release of one of such joint promisors by the promisee does not discharge the other joint promisor or joint promisors; neither does it free the joint promisors so released from responsibility to the other joint promisor or promisors.

Courtesy:- Legal Point Foundation

Distinction between fraud and misrepresentation

The principal difference between fraud and misrepresentation is that in the case of fraud the person making representation does not believe it to be true. And in the case of misrepresentation he believes it to be true But in both cases, it is mis-statement of fact which misleads the other party. Again fraud not only affords a ground for avoiding the contract, it also enabled the party defrauded to bring an action in tort for damages whereas misrepresentation merely affords a ground for avoiding the contract and not for bringing an action in tort. When recession is claimed, it is only necessary to prove that there was misrepresentation then however honestly it may have been made, however, free from blame the person who made it may be, the contract, having been obtained by misrepresentation, cannot stand. But in order to sustain an action for deceit, there must be proof of fraud; and fraud is proved only when it is shown that a false statement has been made knowingly or without belief in its truth, or recklessly, carelessly whether it is true or false. Again in case of misrepresentation the fact that the plaintiff had that means of discovering the truth by exercising ordinary diligence, can be good defence against the repudiation of the contract, whereas such a defence cannot be set up in the case of fraud other than fraudulent silence {Exception to Section 19}.
Courtesy:- Legal Point Foundation 

Distinction between Coercion and Undue influence

Coercion is defined in Section 15 and Undue Influence is defined in Section 16 of the Indian Contract Act, 1872.
Coercion
Undue Influence
a)      It involves the physical force or threat.
The aggrieved party is compelled to make the contract against its will.
b)     It involves committing or threatening to commit and act forbidden by Indian Penal Code or detaining or threatening to detain property unlawfully.
c)     It is not necessary that there must be some sort of relationship between the parties.
d)     Coercion need not proceed from the promisor nor need it be the directed against the promisor.
e)     The contract is voidable at the option of the party whose consent has been obtained by the coercion or enforce it in a modified form.
f)      In case of coercion where the contract is rescinded by the aggrieved party, as per Section 64, any benefit received has to be restored back to the other party.
a)  It involves moral or mental pressure.





b)  No such illegal act is committed or a threat is given.





c) Some sort of relationship between the parties is absolutely necessary. 
d) Undue influence is always exercised between parties  to the contract.

e) Where the consent is induced by undue influence, the contract is either voidable or the count may set it aside.



f) The court has the discretion to direct the aggrieved party to return the benefit in whole or in part or not to give any such directions.





Courtesy:- Legal Point Foundation

Position of Minor's agreement

The term minor/minors is no where defined in the contract act. But taking into consideration the wordings of section 11 of Indian contract act, a minor is a person who has not attained the age of 18 years.
The age of majority of a person is regulated by section 3 of the Indian majority act, 1857.
Section 3 of the INDIAN MAJORITY ACT, 1875 provides about the age of majority. It states that a person is deemed to have attained the age of majority when he completes the age of 18 years, except in the following cases a person continues to be a minor until he completes the age of 21 years
 · Where a guardian of a minor’s person or property has been appointed under the Guardians and Wards Act, 1890 or
 · Where the superintendence of a minor’s property is assumed by a Court of Wards.
Section 11 of the act expressly forbids a minor from entering into a contract. The effect of this express prohibition is that any contract entered into by a minor is void-ab-initio regardless of whether the other party was aware of his minority or not.
A contract with or by a minor is void and a minor, therefore, cannot, bind himself by a contract. A minor is not competent to contract. In English Law, a Minor in contract, subject to certain exceptions, is only voidable at the option of the minor. In 1903 the Privy Council in the leading case of Mohiri Bibi v. Dharmodas Ghose (190, 30 Ca. 539).Held : That in India minors contracts are absolutely void and not merely voidable. Dharmodas   Ghose  , a minor, entered into a contract for borrowing a sum of Rs. 20,000 out of which the lender  paid the minor a sum of Rs. 8,000. The minor executed mortgage of property in favour of the lender. Subsequently, the minor sued for setting aside the mortgage. The Privy Council had to ascertain the validity of the mortgage. Under Section 7 of the Transfer of Property Act, every person competent to contract is competent to mortgage. The Privy Council decided that Sections 10 and 11 of the Indian Contract Act make the minors contract void. The mortgagee prayed for refund of Rs. 8,000 by the minor. The Privy Council further held that as a minor’s contract is void, any money advanced to a minor cannot be recovered. 
1.   An agreement entered into by a minor is altogether void:- The word void when used in relation to a minor it should be understood as "void as against the minor". Contract within or by a minor is altogether void. The Indian Contract Act simply says that only a person who is a major is competent to contract. The main reason for holding a minor's agreement void is that where an agreement by a minor involves a promise on his part or his promise is a necessary part of the agreement it is void because a minor is incapable of giving a promise imposing a legal obligation.
2.   Minor can be a beneficiary:- Though a minor is not competent to contract, nothing in the Contract Act prevents him from making the other party bound to the minor. Thus, a promissory note duly executed in favour of a minor is not void and can be sued upon by him, because he though incompetent to contract, may yet accept a benefit.  
A minor cannot become partner in a partnership firm. However, he may with the consent of all the partners, be admitted to the benefits of partnership (Section 30 of the Indian Partnership Act).
3.   Minor can always plead minority:- A minor's contract being void, any money advanced to a minor on a promissory note or otherwise, cannot be recovered. Even when a minor procures a loan by falsely representing that he is full age, it will not stop him from pleading his minority in a suit to recover the amount and the suit will be dismissed.
But where a minor had fraudulently mortgaged and sold certain properties, the Court held that on the cancellation of the agreement at the instance of the minor the lender and purchaser must be compensated.
4.   Ratification on attaining majority is not allowed:- As a minor's agreement is void he cannot validate it by ratification on attaining majority. For instance, a minor borrows money and executes a promissory note. On attaining majority, he executes a fresh promisor note in substitution of the one executed as a minor. The second promissory note is also void being without consideration. But a person who supplies necessaries of life to a minor or to one whom the minor is legally bound to support, according to his station in life, is entitled to be reimbursed from the property of the minor not on the basis of any contract but on the basis of an obligation resembling a contract (Section 68).But a minor's property in liable for necessaries and no personal liability is incurred by him.
5.   Contract by guardian - how far enforceable:- Though a minor's agreement is void, his guardian can, under certain circumstances enter into a valid contract on the minor's behalf. Where the guardian makes a contract for the minor, which is within his competence and which is for the benefit of the minor, there will be valid contract which the minor can enforce. For instance a guardian can make an enforceable contract of marriage for a minor. Similarly, when the father of the bridegroom contracts with the father of the bride to pay the bride an allowance the bride can sue her father-in- law to recover arrears of the allowance.
But all contracts made by guardian on behalf of a minor are not valid. For instance, the guardian of a minor has no power to bind the minor by a contact for the purchase of immovable Property. But a contract entered into by a certified guardian (appointed by the Court) of a minor, with the sanction of the court for the sale of the minor's property, may be enforced by either party to the contract.
6.   Liability for necessaries:- Under Section 68, any person would be entitled to reimbursement out of the minor's estate, for necessaries supplied to him or to his family. Necessaries as defined by the English Sale of Goods Act, also means, goods suitable to the condition in the life of infant as required by him at the time of sale of delivery. It includes not only food and clothing but also education and instruction. Necessaries also include 'goods' and services. If minor had obtained payment fraudulently by concealment of age, he may be compelled to restore the payment but he cannot be compelled for an identical sum, if any, as it would amount to enforcing a void contract.
Courtesy:- Legal Point Foundation


VALIDITY OF AN AGREE MENT WITHOUT CONSIDERATION

The general rule is that an agreement made without consideration is void (Section 25). In ever valid contract consideration is very important. A contract may only be enforceable when a adequate consideration is there. However, the Indian Contract Act contains certain exception to this rule. In the following cases, the agreement though made without consideration, will be valid and enforceable.
1.      Natural Love and Affection: A written and registered agreement based on natural love and affection between the parties standing in near relation (e.g., husband and wife) t each other is enforceable even without consideration.
2. Compensation for past voluntary services: A promise to compensate, wholly or in part a person, who has already voluntarily done something for the promisor, is enforceable under (Sec. 25(2). In order that a promise to pay for the past voluntary services is binding the following essential factors must exist :
(i) The services should have been rendered voluntarily.
(ii) The services have been rendered for the promisor.
(iii) The promisor to be in existence at the time when services were rendered.
(iv) The promisor must have intended to compensate the promisee.
3.   Promise to pay time barred debt : Where a promise in writing signed by the person making it or by his authorised agent, is made to pay a debt barred by limitation it is valid without consideration [Section 25(3)].
4.  Agency: According to Section 185 of the Indian Contract Act, no consideration is necessary to create an agency.
5.    Completed gift: In case of completed gifts, the rule no consideration no contract does not apply. Explanation (1) to Section 25 states "nothing in this section shall affect the validity as between the donor and donee, of any gift actually made." Thus, gifts do not require any consideration.

Courtesy:- Legal Point Foundation

LEGAL REQUIREMETS REGARDING CONSIDERATION

Consideration is essential for a valid contract. It is the price for a promise – a quid pro quo. It is the value received as incentive for the promise. A contract without consideration is not binding on the parties.
Blackstone defined consideration as “the recompense given by the party contracting to the other”.
Pollock took consideration to be “the price for which the promise of the other is bought, and the promise thus given for value is enforceable”.
Section2 (d) of the Indian Contract Act,1872 defines consideration in the following words:
When at the desire of the promisor, the promisee or any other person has done or abstained from doing, or does or abstains from doing , or promises to do or abstain from doing something, such act or abstinence or promise is called a consideration for the promise.”
Illustration:-
 X promises to deliver 10 kgs of basmati rice to Y and Y promises to pay Rs. 500 upon delivery. In this contract, Y’s promise to Rs. 500 upon delivery is the consideration for X’s promise. Similarly, X’s promise to deliver 10 kgs of basmati rice is the consideration for the promise Y made.
Consideration is the foundation of ever contract. The law insists on the existence of consideration if a promise is to be enforced as creating legal obligations. A promise without consideration is null and void.
i)     Consideration must move at the desire of the promisor :- Consideration must be offered by the promisee or the third party at the desire or request of the promisor. An act done at the desire 'of a third party is not a consideration.
ii)    Consideration from promisee or any other person :- In India, consideration may process from the promisee or any other person who is not a party to the contract. The definition of consideration as given is Section 2(d) makes that proposition clear. According to the definition, when at the desire of the promisor, the promisee or any other person does something such an act is consideration. In other words, there can be a stranger to a consideration but not stranger to a contract.
iii)Executed and executory consideration:- A consideration which consists in the performance of an'" act is said to be executed: When it consist in a promise, it is said to be executory. The promise by one party may be the consideration for an act by some other party, and vice versa. For example, A pays Rs. 5,000 to Band B promises to deliver to him a certain quantity of wheat within a month. In this case A pays the amount, whereas B merely makes a promise. Therefore, the consideration paid by A is executed, whereas the consideration promised by B is executory.
iv)  Past Consideration:- The words has done or abstained from doing" [as contained in Section 2(d)] are a recognition of the doctrine of past consideration. In order to support a prorruse, a past consideration must be moved by a previous request. It is the general principal that consideration is given and accepted in exchange for the promise. The consideration, If past, may be the motive but cannot be the real consideration of as subsequent promise. But in the event of the services being rendered in the past at the request or the desire of the promisor the subsequent promise is regarded as an admission that the past consideration was not gratuitous.
v)     Adequacy- of consideration:- Consideration need not be any particular value. It need not be approximately equal value with the promise for which it is exchanged but it must be something which the law would regard as having some value.
It may be noted in this context that Explanation 2 to Section 25 states that an agreement to which the consent of the promisor is freely given is not void merely because the consideration is inadequate.      
vi)   Performance of what one is legally bound to perform:- The performance of an act by a person f' who is legally bound to perform the same cannot be consideration for a contract. Hence, a promise to pay money to a witness is void, for it is without consideration. Hence such a contract is void for want of consideration. Similarly, an agreement by a client to pay to his counsel after the latter has been engaged, a certain sum over and above the fee, in. the event of success of the case would be void, since it is without consideration.       
But where a person promises to do more that he is legally bound to do such a promise provided it is not opposed to public policy, is a good consideration.
vii) Consideration must not be unlawful, immoral, or opposed to public policy.

Courtesy:- Legal Point Foundation

Offer and Invitation to Offer

An offer should be distinguished from an invitation to offer. An offer is definite and capable of converting an intention into a contract. Where as an invitation to an offer is only a circulation of an offer, it is an attempt to induce offers and precedes a definite offer. Acceptance of an invitation to an offer does not result contract and only an offer emerges in the process of negotiation.

When a person advertises that he has a stock of books to sell or houses to let, there is no offer to be bound by any contract. Such advertisements are offers to negotiate-offers to receive offers. In order to ascertain whether a particular statement amount to an 'offer' or an 'invitation to offer', the test would be intention with which such statement is made. Does the people who make the statement intend to be bound by it as soon as it is accepted by the other or he intends to do some further act, before he becomes bound by it? In the former case, it amounts to an offer and in the latter case, it is an invitation to offer.
Courtesy:- Legal Point Foundation

27 February, 2016

Classification of Offer

The words proposal and offer are used interchangeably and it is defined under Section 2 (a), Indian Contract Act, 1872 as when one person signifies to another his willingness to do or to abstain from doing anything with a view to obtaining the assent of that other to such or abstinence, he is said to make a proposal. Thus, for a valid offer, the party making it must express his willingness ‘to do’ or ‘not to do’ something.
The word ‘proposal’ used above is synonymous in English Law with ‘offer’.  
(a) General Offer: - It is an offer made to the public in general and hence anyone can accept and do the desired act. Section 8 of the Indian Contract Act points out that performance of the conditions of a proposal is an acceptance of the proposal.
(b) Special Offer: - When offer is made to a definite person, it is known as specific offer an such offer can be accepted only by that specified person.
(c) Cross Offers: - When two parties exchange identical offers in ignorance at the time of each other's offer, the offers are called Cross offers. There is not biding contract in such a case as one's offer cannot be construed as acceptance by the other.
(d) Counter Offer: - When the offeree offers to qualified acceptance of the offer subject b modifications and variations in the terms of original offer, he is said to have made a counter offer. Counter-offer amounts to rejection of the original offer.
(e) Standing, Open or Continuing offer: - An offer is allowed to remain open for acceptance over a period of time is known as a standing, open or continuing offer. Tender for supply goods of  is a kind of standing offer time the offer would be considered as accepted.

Courtesy:- Legal Point Foundation

TYPES OF CONTRACT

The definition of Contract is given under section 2(h) of the Indian Contract Act, which provides ‘a contract is an agreement enforceable by law’. Thus a contract is an agreement made between two or more parties which the law will enforce.
From the above definition it could be seen that the definition of contract consists two elements-
1. An agreement and, 2. Its enforceability by law.
An agreement is defined under section 2 (e) as ‘every promise and every set of promises, forming consideration for each other. When a proposal is accepted it becomes a promise. Thus an agreement is an accepted proposal. Therefore, in order to form an agreement there must be a proposal or an offer by one party and its acceptance by other party. In short Agreement=Proposal + Acceptance.
 The second part of the definition deals with enforceability by law. An agreement is enforceable under section 10 if it is made by competent parties, out of their free consent and for lawful object and consideration. Therefore, a Contract = Agreement + Enforceability. Thus all contracts are agreements but all agreements are not necessarily contracts.
1. Void Contract:- It is a contract without any legal effect and cannot be enforced in a Court of Law. Section 2(j) defines a void contract as "a contract which ceases to be enforceable by law becomes void when it ceases to be enforceable".     
Examples: Where both parties to an agreement are under a mistake of fact, (Section 20), when the consideration or object of an agreement is unlawful, (Section 23), an agreement made without consideration, (Section 25), agreement in restraint of marriage (Section 26), trade (Section 27), legal proceedings (Section 28), agreement by way of wager (Section 30) are instances of void contract.
2.Voidable Contract:- As per Section 2(i), "an agreement which is enforceable by law at the option of one or more the parties but not at the option of the other or others is a voidable contract."
Examples:- A contract brought about as a result of Coercion, Undue influence, Fraud or misrepresentation would be voidable at the option of the person whose consent was caused by anyone of these factors.
Void and Voidable contract: Distinction
(a) Definition:- As per Section 2(j) and (i) a contract which ceases to be enforceable by law becomes void when it ceases to be enforceable and a voidable contract is an agreement which is enforceable by law at the option of one or more of the parties thereon, but not at the option of other or others.
(b) Nature:- A void contract is valid when it is made but subsequently becomes unenforceable on certain grounds such as supervening impossibility, subsequent illegality, repudiation of a voidable contract, a contingent contract depending upon happening of an uncertain event, when occurrence of such event becomes impossible.
A voidable contract on the other hand is voidable at the option of the aggrieved party, and remain valid until rescinded by him. Contract caused by coercion, undue influence, fraud, misrepresentation are voidable. But in case contract is caused by mistake it is void.
(c) Rights:- A void contract does not provide any legal remedy for the parties to the contract. They even cannot get it performed when they so desire. The aggrieved party in a voidable contract gets a right to rescind the contract. When such party rescind it, the contract becomes void. In case aggrieved party does not rescind the contract within a reasonable time, the contract remains valid.
3.Illegal contract :- Itis a contract which the law forbids to be made. The court will not only enforce such a contract but also connected contracts. All illegal agreements are void but all void agreements or contracts are not necessarily illegal.
Examples: Contract to commit crime. Contract that is immoral or opposed to public policy are illegal in nature.
Void and Illegal agreements: distinction.
According to Section 2 (g) of the Indian Contract Act, an agreement not enforceable by law is void. The Act has specified various factors due to which an agreement may be considered as void agreement. One of these factors is unlawfulness of object and consideration of the contract i.e., illegality of the contract which makes it void. Despite the similarity between an illegal and a void agreement that in either case the agreement is void and cannot be enforced by law, the two differ from each other in the following two respects:-
(a) Scope:- An illegal agreement is always void while a void agreement may not be illegal being void due to some other factor e.g., an agreement the terms of which are not uncertain is void but not illegal.
(b) Effect on collateral transaction:- If an agreement is merely void and not illegal, the collateral transactions to the agreement may be enforced for execution but collateral transaction to an illegal agreement also becomes illegal and hence cannot be enforced.
(c) Punishment:- Unlike illegal agreements, there is no punishment to the parties to a void agreement.
(d) Void-ab-initio:- Illegal agreements are void from the very beginning, but sometimes valid contracts may subsequently become void.
4. Unenforceable contract:- Where a contract is good in substance but because of some technical defect i.e., absence in writing, barred by, imitation etc. one or both the parties cannot sue upon it, it is described as an unenforceable contract. Contracts may also be classified according to formation namely, Express Contracts and Implied Contracts.
5. Express Contracts:- A contract which is made by words either spoken or written is said to be an express contract. According to Section 9 insofar as the proposal or acceptance of any promise is made in words, the promise is said to be express.
6. Implied Contract:- By implied contract means implied by law (i.e.) the law implies a contract though parties never intended. According to Section 9 insofar as such proposal or acceptance is made otherwise than in words, the promise is said to be implied. For example, A delivers by mistake goods at B's warehouse instead of at C's place. Here there is an obligation on the part of B to return the goods to A, though they never intended to enter into a contract.
7. Tacit Contract:- A contract is said to be tacit when it has to be inferred from the conduct of the parties. Examples obtaining cash through automatic teller machine, sale by fall of hammer at an auction sale. Besides contracts may be classified on the basis of performance. Such contracts may be executed, executory, unilateral and bilateral.
8.Executed Contract:- If the consideration for the promise in a contract (i.e., any act or forbearance) is given or executed, such type of contract is called contract with executed consideration.
9. Executory Contract:- It is so called because the reciprocal promises or obligation which serves as consideration is to be performed in future.
10. Unilateral Contract: A unilateral contract is a one-sided contract in which only one party has to perform his promise or obligation to do or forbear.
11.  Bilateral Contract: Where the obligation or promise in a contract is outstanding on the part of both the parties, it is known as bilateral contract.
Formal Contracts :-
The English Law classifies the contract into (i) formal contracts, and (ii) simple contracts.
Formal Contracts include (a) Contract of record and (b) Contract under Seal.
(a) Contract of Record:- A contract of record is either a judgement of a court or a recognisance. A judgement is an obligation imposed by a Court upon one or more persons in favour of another or others. As a matter of tact it is not a contract in the real sense, since it is not based upon any agreement between the two parties. A recognisance is a written acknowledgement of a debt due to the State. It is usually met with the connection with criminal proceedings.
Contracts of record derive their binding force from the authority of the Court.
(b) Contract under Seal:- A contract under seal is one which derives its binding force from its form atone. It is writing and is signed, sealed and delivered by the parties. It is also called a deed or a specialty contract
Courtesy:- Legal Point Foundation

26 February, 2016

Distinguish between Particular and General Lien

Particular and General Lien can be distinguished as follows:-
Particular Lien
General Lien
1.      Provisions relating to Bailee’s particular lien is provided under Section 170 of the Contract Act.
2.  The right of a particular lien can be claimed by every bailee.










3.      The right of particular lien can be claimed only in respect of goods upon which some labour or skill has been exercised by the Bailee.
1.      Provisions relating to general lien is provided under Section 171 of the Contract Act.

2.  The right of general lien is granted to Bankers, Factors, wharfingers, Attorney of High Courts and Policy brokers generally. Though under Section 171 the parties to the contract of bailment can, by mutual agreement confer right of general lien on a bailee.
3.    The right of general lien can be claimed in respect of any charge due in respect of other goods.

Courtesy:- Legal Point Foundation