Essentials of a valid contract
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The key elements of a valid contract are: 1. Offer - A proposal made with intention to obtain legal consent from the offeree. It must be clear, definite, complete and communicated to the offeree. 2. Intention to create legal relations - There must be an intention between parties to create legal obligations. 3. Consideration - There must be something of value exchanged between parties, such as a promise for a promise. Consideration can be executory, executed, or past consideration.
Essentials of a valid contract
- 1. Essentials of a Valid contract
- 2. OFFER / PROPOSAL INTENTION TO CREATE LEGAL RELATION CONSIDERATION
- 3. U/S-2(a) PROPOSAL or OFFER :- When one person signifies his willingness to do or to abstain from doing anything, with a view to obtain the assent of that other to such act or abstinence, he is said to make a Proposal.
- 4. PROMISE
- 5. KINDS OF OFFER 1.According to mode of communication Express offer : when an offer is put in words. Implied offer : inferred from the conduct . 2.On the basis of offerees: Specific offer -to a particular person. General offer -to the public at large generally.
- 6. 3. on the basis of nature Cross offer: when two persons without having the knowledge of other’s offer made to each other identical offers. Counter offer: Rejecting an original offer and making a new offer. The new offer is counter offer Standing offer: a standing offer is an offer which is open for acceptance over a period of time. This offer is also called continuing offer or open offer
- 7. Rules governing Offer Clear , definite ,complete and final Offer must communicated to the offeree Communication – words , oral or implied Communication - specific or general
- 8. Lapse of offer U/S .6 : offer lapses if :- It is not accepted within the specified time / Reasonable time (if not specified ) It is not accepted in the mode prescribed / usual and reasonable manner (if not specified) Either the offerer or the offeree dies before acceptance . The acceptor fails to fulfill a condition precedent to acceptance .
- 9. Revocation of offer Before acceptance an offer may be revoked by the offeror Revocation must be communicated before acceptance .
- 10. Acceptance “ When a person to whom the proposal is made signifies his assent thereto ,the proposal is said to be accepted .”
- 11. Rules Governing Acceptance Acceptance may be express :- words spoken or written or implied from the conduct of the parties . If particular methord of acceptance is prescribe , the offer must be accepted in the prescribed manner Acceptance must be given in a reasonable time and before the offer lapses or is revoked. Mere silence on the part of the offeree does not amount to acceptance .
- 12. 2 .Intention to Create Legal Relation There must an intention among the parties that the agreement should be attached by the legal consequences and legal obligations If there is no intention between the parties , there is no contract .
- 13. 3.Consideration Definition Some right , interest , profit or benefit accruing to one party ,or promise thereof is the price for which the promise of the other is bought Forbearance = to do or not to do
- 14. Kinds of Consideration Executory or future : Promise to be performed in the future , E.g. : An engagement to marry someone Executed or Present : It is an act or constituting consideration is wholly or completely performed , Eg: A pays today Rs.100 toa shopkeeper for goods which are promised to be supplied the next day 3.Past consideration : Past act or forbearance, an act constitute consid’n which took place and is complete before the promise is made
- 15. Love and affection Indemnify , or giving Damage Payoff debt Gift
- 16. U/S-2(C ) PROMISOR AND PROMISEE :-The person making the proposal is called the promisor. And the person accepting the proposal is called the promisee or (offeror and oferee) U/S-2 (e):AGREEMENT: - Every promise and every set of promises ,forming the consideration for each other, is an agreement .