Chapter 3 Validity Of Contracts Flashcards
What are Essentials of valid contract?
Two persons offeror and offeree
Intention to create legal relationship
Capacity/competence of parties
Free consent
Consideration
Lawful object
Possibility of performance
Certainty
Legal formalities regarding writing and registration
What are types/classification of contracts?
Valid Contract
Void Contract
Voidable Contract
Voidable Contract
Agreement which is enforceable at the option of aggrieved party.
1.Agreement in which consent is not free
2.Agreement in which goods or services are not delivered on specified time
3.Agreement in which goods or services are not accepted by buyer
Considration
When at desire of promisee the promiser(or his agent on his behalf)has done or does or promises to do something,such act is called consideration for the promise.
Essentials of consideration
1.Consideration must b given at desire of promisee
2.Consideration may b given by promisor or any other person
3.Consideration may b past present or future act or abstinence
4.Consideration must be something in value
5.Consideration must b real
6.Consideration must b something which promisor is not already bound to do
7.Consideration must be lawful
Exception to rule “NO CONSIDERATION NO CONTACT “
1.agreement made on account of natural love and affection
2.Agreement to compensate for past voluntary service
3.Agreement to pay time barred debt
4.Completed gift
5.Contribution to charity
6.Other contracts
.contract of bailment
.Contract of Guarantee
.Contract of Agency
What are illegal Agreements?
An object/consideration is unlawful if:
.it is forbidden by Pakistan penal code
.it involves injury to a person or his property
.it is fraudulent
.if permitted it would defeat provisions of any law
.court regards it immoral or opposed to public policy
Agreement opposed to public policy
.Trading with an alien enemy
.stifling criminal prosecution
.Sale of public office
.marriage brokerage agreement
.restraint of parental rights
.restraint of personal liberty
.agreement to create monopoly
Position of Agreement with minor
.agreement by a minor is void against him
.rule of estoppels does not apply to a minor
.No ratification of agreement by minor
.Minor cannot be a patner however he can be admitted to the benefits of partnership
.A minor can be agent,and can bind principal with his acts
.agreement by guardian or parents on behalf of minor for his benefits can be enforced against him
Contacts by minor and adult jointly
.minor cannot be declared as insolvent
.A minor can sue but can not be sued in civil court
.Necessities of life supplied to minor can b recovered
Agreement with person of unsound mind (specific person) unsound mind by birth
Agreement with such person is always void
Agreement with lunatic
If lunatic is of unsound mind at the time of contract,it will be void
If lunatic is of sound mind at the time of contract,it will be valid. However party enforcing contract will have to prove this.
Which Persons are disqualified by law?
.Alien enemy
.foreign sovereigns and ambassador s
.convicts
.Insolvent
