1

MODELQUESTI
ONPAPER
CONTRACT1
Uni
t1
Q.
1
a.Def
ineCont
ract
.Descr
ibet
hev
ari
ousr
equi
sit
es
ofavali
dcont
ract
.
Lawmeansa‘ setofr
ules’whi
chgover
nsourbehavi
ourand
rel
atinginacivi
li
zedsociet
y.Oneshouldknowthel
awt owhichhei
s
subjectbecause“I
gnoranceoflawisnoexcuse”
.

Cont
ract
sasdef
inedbyEmi
nentJur
ist
s

1. “Ever
yagr
eementandpr
omi
seenf
orceabl
eatl
awi
sacont
ract
.”
-
Pol
l
ock

2. “ ACont r
acti
sanagr eementbet weentwoormor eper
sons,which
i
sintendedtobeenforceabl
eatlawandi scontract
edbytheaccept
ance
byonepartyofanoffermadet ohim bytheotherpart
y,t
odoorabstain
fr
om doingsomeact”–Hal sbury

3. “Acont
ractisanagr
eementcr
eat
inganddef
ini
ngobl
i
gat
ion
bet
weent
hepart
ies”–Sal
mond

Cont
ract2(
h):
-Anagr
eementenf
orceabl
ebyLawi
sacont
ract
.

Sec.10:-“
All agreement sar
econtr
acts,
iftheyar emade-byf r
ee
consentoft hepar t
ies,compet
enttocontr
act ,f
oralawfulconsi
derati
on
andwi t
hal awf ulobject,
andnother
ebyexpr essl
ydeclar
edt obevoid;
”

ESSENTI
ALSOFAVALI
DCONTRACT

Of
fer+accept
ance=Pr
omi
se+consi
der
ati
on=Agr
eement
+
Enf
orceabi
l
itybyLaw=cont
ract
.

1. Pr
operof
ferandpr
operaccept
ancewi
thi
ntent
iont
ocr
eat
elegal
 2

r
elat
ionshi
p

Cases–AandBagr eetogot oamov i

eoncomi ngSunday .A
doesnott urninr esult
inginlossofB’st ime. B cannotcl aim any
damagesf r
om A,since t
heagreementtowat chamov i
eis
adomest i
cagreement ,whichdoesnotresulti
nacont r
act .Incaseof
soci
alagreement,thereisnoi nt
enti
ontocreatelegalr
elationshi
pand
ther
eisnocontract(Balf
ourv.Balf
our)

In caseofcommer ci
alagreement
s,thelaw pr
esumet
hatt
he
par
ti
eshadt hei
ntent
iont
ocreat
elegal
rel
ati
ons.

(anagr
eementofapur
elydomest
icorsoci
alnat
urei
snota
cont
ract
)

2. Lawf
ulconsi
der
ati
on:-Consi
der
aton must notbe unl
i awf
ul,
i
mmor al
oropposedt
ocont
ract
.
3. Capacit
y:-Thepart
iest
oacont
ractmusthav
ecapaci
ty(
Legal
abi
li
ty)t
omakevali
dcont
act
,

Sect
ion11:-oftheIndi
anContractActspeci
fyt
hatev
eryper
soni
s
competentt
ocont
ract
,pr
ovi
ded,

(
i) I
soft
heageofmaj
ori
ty,
accor
dingt
otheLaw,
whi
chhei
ssubj
ect
;
and
(
ii
) Whoi
sofsoundmi
nd;
and
(
ii
i) I
snotdi
squal
i
fiedf
rom cont
ract
ingbyanyl
aw t
owhi
chhei
s
subj
ectt
o.
Per
sonofunsoundmi
ndcanent
eri
ntoacont
ractdur
inghi
sluci
d
i
nter
val
Anal
i
enenemy
,for
eignsov
erei
gnsandaccr
edi
tedr
epr
esent
ati
ves
ofa
f
orei
gnst
ate.
I
nsol
vent
sandconv
ict
sar
enotcompet
entt
ocont
ract
.
4. Fr
eeconsent
:-Consentoft
hepart
iesmustbegenui
neconsent
,
eeduponsamet
meansagr hi
ngi
nthesamesensei
.e.t
her
eshould
 3

beconsensus-
ad-
idem.
Theconsentissai
dtobefreewheni snotcausedbycoer
ti cion,undue
i
nfl
uence,f
raud,mi
srepr
esent
ati
onormist
ake.
5. Lawf
ulObj
ect

TheObj ectofagreementshoul
dbelawful
andlegal
.Twopersons
cannotenterint
oanagr eementtodoacri
minalact
.Consi
derat
ionor
objectofanagreementisunlawful
,i
fit
….

a.I
sfor
biddenbyl
aw;
or

b.I
sofsuchnaturet
hat
,ifper
mit
ted,
woul
ddef
eatt
he
pr
ovi
sionsofanyl
aw;or

c.I
sfr
audul
ent
;or

d.I
nvol
vesori
mpl
i
es,
inj
uryt
oper
sonorpr
oper
tyofanot
her
;
or

e.Cour
tregar
dsi
tai
mmor
al,
oropposedt
opubl
i
cpol
i
cy.

6. Possi
bil
i
tyofper
for
mance:
Thet
ermsoft
heagr
eementshoul
dbecapabl
eofper
for
mance.An
agr
eementt
oanact
,impossi
blei
nit
sel
f,cannotbeenf
orced.
Example:AagreestoBtodi
scov
ert
reasur
ebymagic.Theagreementi
s
voi
d,becausetheacti
nit
sel
fisi
mpossi
bletobeper
for
medfrom the
verybegi
nning.

7. Thet ermsoftheagreementarecer
t ai
norar ecapabl
eofbeing
madecer t
ain-Sec-
29:
Exampl
e:Aagr eedtopayRs.
5Lakhst oB, f
orultra-
moderndecorat
ion
ofhi
sdrawingroom.Theagr eementi
sv oid,becausethemeaningof
thet
erm“ultr
a-modern”i
snotcert
ain.

8. Notdecl ar
edv oid
Theagreementshouldbesuchthati
tshoul
dbecapableorbei
ng
enf
orcedbylaw.Cer t
ainagr
eementshavebeenexpr
essl
ydeclar
ed
i
ll
egalorvoi
dbylaw.

9. Necessar
ylegal
for
mal
i
ties
 4

Acont actmaybeor
r alorinwr i
ting.Wher eapar t
icul
art y
peofcont ract
i
sr equi
redbyl aw t obei nwr it
ingandr egister
ed,itmustcompl ywi th
necessaryf
ormal it
iesast owrit
ing,registrati
onandat t
estati
on.Ifl egal
for
mal i
ti
esarenotcar r
iedout,thent hecont r
actisnotenf orceableby
l
aw.
Exampl e-Apr omiset opayat i
mebar r
eddebt ,mustbei n
wri
ting.
Agreementi s a wi dert erm t han contract,wher eas,al l
contractar eagr eement s,allagreement sarenotcont racts.
Thusweseet hat,anagr eementmaybeormaynotbe,
enforceabl ebyl aw. Soal lagr eement sarenotcont racts.
Onlyt hoseagr eement sar econt r
acts,whichar eenforceabl e
by l aw. Hence we can concl ude,“ Allcont r
act ar e
agreement s,butall
agr eement sarenotcont ract.
”
Cont ract=Agr eement+enf orceabili
tybylaw.

b.Defi
netypesorclassi
fi
cati
onofcontr
acts.
Expl
aintheessenti
alsandrul
esofval
idProposal
(Off
er)wit
hil
lust
rati
ons.
Ty
pesorCl
assi
fi
cat
ionofCont
ract
s

* Vali
d-Anagreementwhi
chhasal
ltheessent
ial
element
sofa
cont
ract
,iscal
l
edav al
i
dcontr
act
.

* Void-(Sect
ion2(j)-Iti
sacontract
,whichceasestobe
enf
orceabl
ebylaw.Acont ractwhenordi
naril
yenter
edinto,maybev
ali
d
orbi
ndingonthepart
ies;butitmaysubsequentl
ybecomev oid.

* Voidabl
e-(Secti
on2(i
)-Anagr eement,whi
chisenf
orceabl
eby
l
aw,attheopti
onofoneormor eofthepart
iesther
eto,
butnotatthe
opt
ionofotherorot
hers,
isavoidabl
econtract
.

* Il
legalContract-Acont racti
sil
legal
,ifi
tisf
orbiddenbyl awori s
ofsuchnat urethat,i
fpermitted,woulddefeatt
heprov isi
onsofanyl aw
orisfraudulent
;orinvolvesori mpl
iesinj
urytoapersonorpr opertyof
another,orcourtregardsitasi mmoraloropposedtopubl icpoli
cy.
Theseagr eementsar epunishablebylaw.Thesear ev oid-
ab-i
nit
io.
“
All
il
legal
agr
eement
sar
evoi
dagr
eement
sbutal
lvoi
dagr
eement
sar
e
 5

noti
l
legal
”.

* Unenf
orceableContr
act–Wher eacontracti
sgoodi nsubstance,
butbecauseofsomet echnicaldef
ect
,cannotbeenfor
ceablebylaw, i
s
cal
ledUnenforceabl
eContract.Thesecontr
actsar
eneithervoi
dnor
voi
dable.

Ont
hebasi
soff
ormat
ion

a.Expr
essCont
ract

b.I
mpl
i
edCont
ract

c.Quasi
Cont
ract

Ont
hebasi
sofper
for
mance

a.Execut
edCont
ract

b.Execut
oryCont
ract

c.Uni
l
ater
alCont
ract

d.Bi
l
ater
alCont
ract

PROPOSAL–
Sec2( a)-oft heIndianCont ractsAct,definesproposalas:
oneper sonsi gnifi
est oanot herhiswill
ingnesst odoort oabst ai
n
fr
om doi ng
anything, withav i
ewofobt ainingtheassentoft hatothert osuchact
or
abstinence, saidtomakeapr oposal
.Thet erm‘proposal’i
s
equiv
alentt ot he
term‘ offer’
.
Section2( b)def i
nes“ pr omi se”
Section2( c)def i
nes“ pr omi sor”or“promi see”
Section2( f)def i
nesr eciprocal pr
omises.
The“ pr oposal ”acceptedbecomesa“ pr omise”.Apr oposal -
1)Theper sonmaki ngi tsigni fi
eshiswi l
li
ngnessordesi retoanother
.
2)Thi swi lli
ngnessi st heexpr essionofdesi r
etodoort oabst ain
fr
om doi ngsomet hing.
3)Obj ectoft heexpr essi onoft hi
swil
lingnessistoabst aintheassent
oft hat
 6

ot
hert
osuchactorabst
inence.
REQUI
SITESOFAVALI DCONTRACT
1)Pur poseofof f
er:Theof ferasdef inedi nSect i
on2( a)has2
pur poses:
a)Anexpr essi onofof feror’swill
ingnesst odoort oabst ainf rom
doi ngsomet hing;
b)I tismadewi thav iewt oobtainingt heassentoft heof fereet o
thepr oposal actorabst i
nence.
2)Intent i
on: Theof ferar isesf rom thei ntention.I tisnotdef i
nedi n
IndianCont r
actAct ,1872.Sect i
on2( a)usest hewor d“ will
ingness”
whi chi sequal t
oi nt ent ion.
 Theof fermustbemadewi thwi lli
ngnesst odobusi nesson
thepr oposedt er msandcondi t
ions.
 Theuseoft hewor d“will
i
ngness”showst hatint entionst obe
boundbyt hepr oposal ,whenaccept ed, areani ntegral par tof
theconceptofagr eement .
 Thepar tywhoof fer smustknowt helegal consequencesof
theof fer.
 Anof ferorhi saccept anceshoul dbemadewi tht he
i
nt ent i
onsofcr eat inglegal r
elations.
 Thet estofi ntent i
oni sobject i
v enotsubj ective.
 Thei ntentionoft hepar ti
esi snat urall
yt obeknownf rom t he
termsoft heagr eementandt hesur roundi ngci rcumst ances.
3)Legal Consequences: Anof fermustbei ntendedt ocr eatel egal
relationsandmustbecapabl eofcr eat i
ngl egal relati
ons.Of feris
thef irstst epofagr eement .Whenanagr eementi senf orceabl eby
thel aw, t henonl yi tbecomesacont r
act .
4)Assentoft heot herpar ty:Thepr oposal mustbemadewi thav i
ew
toobt ainingt heassentoft heotherpar ty.Si ncet hecont ract
requi res“ consensusadi dem”.
(consentatt hesamet ime)unl esst heof f
er eeisawar eoft heof fer
,
ther e
canbenoaccept anceandconsequent l
ynocont ract.
5)Ter
ms: Theter
msofanof f
ermustbedef
ini
te.Uncer
tai
n,
i
ndefi
nit
eand
ambiguousoff
erdonotconst
it
uteval
i
dcontract
s.
 7

6)Offermustbeaddr essed: Anoffermustbeaddr essedtotheworld

atlargeort oaspeci ficperson.Anof feraddressedtotheworl
dis
call
ed“ generaloffer”andanof f
eraddressedt oaspecif
icper
son
i
scal led“speci
ficof fer”.Anoffercannottakeef f
ectsoasto
createabi ndi
ngcont ract,
unlessandunt i
lithasbeenbroughtto
theknowl edgeoft he
persont owhom i tismade.
7)Wor dsorconduct
:Anoffermaybemadebywor dsofmout horby
writ
ingoritmayevenbemadebyconduct .Amongt hese3way s,
theoffermadebywrit
ingisconsider
edal
ways,t
hebest .Anoffer
whichismadebyconducti scal
ledan“i
mpli
edoffer
”.Anof fer
whichis
expressedbywords,
wr i
tt
enorspokeniscal
led“
expressoffer”
.
(
Sect
ion9oft
heI
CA,
1872)
8)Communicati
on:Anof fermustbecommuni
catedtot
heoffer
ee.
Communicati
onmaybedonei nfol
lowi
ngways:-
i
) I nperson:a)bywor dsofmouth;b)bywr
it
ing;
c)byconduct
.
i
i) Bypost
i
ii
) Byt el
ephone
i
v) Byt el
egraph
v) Byt el
ex
vi
) Byinternet
vi
i) Bye-mailwebsit
e
vi
ii
) Byradi
oort el
evi
sion
i
x) Byf ax
x) BySMSet c.
.
9)Inv
itati
ontooffer
:Invi
tati
onforoff
erisdif
fer
entfor
m ofl
egaloffer
.
Iti
sj ustanenquir
y.Themer estatementofpri
cesinacatal
ogue
i
sanexampl eofi nvi
tati
ontooffer.Catal
ogueisnotanoff
er.Itis
an
i
nvitati
ontooff
er.
Bal
fourv
/sBelfour(
1919)2KB57
 Anoffermustbedisti
ngui
shedfrom invi
tat
iontooffer
.
 Aprospectusi
ssuedbyacompanyf orsubscri
pti
onofits
shar
esbyt hepubl
ic,
isaninvi
tat
iontoof f
er.
 Theoffermustnotcontai
naterm,thenon-complianceofwhi
ch,
 8

maybeassumedt oamounttheaccept ance.

Crossoff
ers:Where2part
iesmakeidentical
offerstoeachother
,in
i
gnoranceofeachother
’soff
er:
theoffersareknownascr ossoff
ersand
neit
herofthe2canbecall
edanaccept anceoftheotherandther
efore
ther
eisnocontract
.

Q.
2
a.Aoutofnaturalloveandaffecti
onpromi
sest
o
giv
ehisson,BRs. 1000underar egi
ster
ed
document.I
si tvali
dcontract
?
 Yes

I
tisav
ali
dcont
ract
/document

I
tisenf
orceabl
eundert
hel
aw

 Reasons-Sec2(d)def
ines:consi
der
ati
on-somet
hingwhi
chi
sof
somev al
ueint
heey eoflaw.

Itmayconsistei
therofsomeri
ghts,i
nterest
,pr
of i
t,benefi
tgett
ing
accrui
ngtoonepar t
yorsomef or
bearance,det
riment ,l
ossor
responsi
bil
i
tygiv
en, suf
fer
edorunder
takenbyt heot herathi
srequest
.

Anagreementmadewi
thoutconsi
der
ati
oni
senf
orceabl
eint
hese
occasi
ons.

Sec25-1)Pr
omi
seduet
onat
ural
lov
eandaf
fect
ion(
Sec25(
1))

“A”i
smadei nfav
ourofnearrel
ati
ononaccountofnat
ural
loveand
aff
ecti
on,t
hesamei sval
i
d,eventhoughther
ewasnoconsider
ati
onfor
suchapromise.Iti
slawf
ulandbinding.

i
) Theparti
estot
heagreementmustbest
andi
ngi
nanear
rel
ati
onshi
ptoeachother
.Fat
her–son

i
i
) I
tismadeby“A”(
Fat
her
)par
tyoutofnat
ural
lov
eand
af
fect
ionf
ort
heson“B”

i
i
i) Thepr omiseshoul
dbeinwr
it
ingandr
egi
ster
ed.Her
eiti
s
regi
stereddocument.
 9

Eg:
-Gi
ftdeeds……Wi
l
l

TheRegi
str
ati
onAct
,1908andt
heI
ndi
anSt
ampAct
,1899ar
e
appl
i
cabl
e.

b.Inaself
-servi
cedepar
tmentalst
oreZ,a
customerpicksupthebookandgoest othecash
countert
opayf ori
t.X,cashi
err
efusestosell
.Z
wantstosuef orbr
eachofcontr
act.Canhehav e
ri
ghttodoso?
-
No-

-
Hehasnor
ightagai
nstt
hecashi
er
-
becausei
tisani
nvi
tat
iont
oof
ferandnotanof
fer
-
int
endi
ngt
oof
fer
.Nof
inal
wil
l
ingnessf
rom t
hesi
deofcashi
er.
-t
herei
snoconsensusadi
dem bet
weent
hem (
Nocont
ract
ual
obl
i
gat
ion
ari
sesbet
weenthem)
-
inv
itat
iont
oof
feri
sdi
ff
erentf
rom al
egal
off
er.

OFFER I
NVI
TATI
ONTOOFFER

1.I
ntheof f
er,
theoffer
erhas 1.I
nt hi
s,t
hepart
yhasnosuch
wil
l
ingnessorint
enti
onto i
ntenti
onorwil
li
ngnesst
o
havethecontr
act. havecontr
act
.

2.Thepersonmakingthe 2.Thepar t
ywhohasar ranged
proposali
scall
edthe thearti
clesoradvert
isedin
offer
or/pr
omisor/pr
oposer
. anymedi acan’tbetermedas
offer
or/promisor/
proposer.
3.Anoffer
,whenaccept
ed
becomesapromise. 3.Aninvi
tat
iont
oof fermaybe
changedasoffer
,butcan’t
4.Inthis,t
heoffer
ormust
becomeasapr omi sei
tis
signifyt
hisi
ntent
ionor
onlyanenqui
ry.
will
ingness.
4.Thepart
yneednothi
s
5.Anof
fermay
becl
assi
fi
ed
i
ntent
ionorwi
ll
i
ngness.
 10

i
ntoaGeneral
Off
erand 5.Ther
ear
enosuchdiv
isi
ons
Speci
fi
cOff
er. amongt
hei
nvi
tat
iontooff
er.

6.Anoffercontai
nsl
egal 6.Aninvit
ati
ont oof
ferdoes
requi
rements. notcontai
nlegal
requi
rements.

Uni
t2
Q.
1
a.Whati sf
reeconsent
?Explai
ninbr
iefwhenthe
consentissaidt
obef r
eeaccordi
ngt
oI ndi
an
ContractAct,
1872?
Sec13:Twopersonshav
esai
dtohav
econsent
edwhentheyagreeupon
samethingi
nthesamesense.I
nEngli
shLawthi
siscal
l
ed“Consensus
adidem”
Eff
ectofabsenceofconsent:Whenther
eisnoconsentatal
l,
the
agreementi
sv oi
d-an-
ini
ti
o.I
tisnotenf
orceabl
eatt
heoptionofei
ther
party.

Example1:Xhavetwocars,oneMar ut
icarandanotherisHondacar.Y
doesnotknowthatXhastwocar sYof fer
stobuyacaratRs. 50,000/
¬-
Herether
eisnoident
it
yofmi ndinrespectofthesubjectmatter
.Hence
ther
eisnoconsentatal
landt heagreementisvoi
d-ab-i
nit
io.

Example2:Anil
li
ter
atewomansignedagif
tdeedthi
nkingt
hati
twasa
PowerofAttor
ney–noconsentatallandt
heagreementwasvoi
d-ab-
ni
tio(
BalaDeviv/
sManumdats)

Fr
eeConsent

Consenti
ssai
dtobef
ree,
wheni
tisnotcausedby(
Sect
ion14)
a. Coerci
on( Sect
ion15)
b. Undueinfl
uence(Sect
ion16)
c. Fr
aud( Secti
on17)
 11

d. Mi
srepresent
ati
on(Sect
ion18)
e. Mi
stake(Secti
on20,21,22)

Eff
ectofabsenceofFreeconsent: -Ifconsenti
scausedbycoer
cion,
undueinf
luence,
fraud,misr
epresentati
on,thecont
racti
svoi
dabl
eatthe
opti
onoftheparty,whoseconsentwasnotf r
ee(19,19A)

Coer cion( Sect ion15)

For ce, compul sion, tr
eat sofv iolence, (Voidabl e)
Dur essi smor esev er et hancoer cion
Essenti
al element sofcoer cion: -
a. Commi t
tinganyact ,whi chisf or biddenbyt heI PC
b. Thr eat eningt ocommi tanyact ,whi chi sfor biddenbyt heI PC
c. Unl awf ul detainingofanypr oper tyor
d. Thr eat eningt odet ai nanypr oper ty
e. Coer ci
onneednotnecessar ypr oceedf r
om par tytocont ract
f. Coer ci
onneednotnecessar ybedi rect edagai nstt heot her
cont ract i
ngpar ty.
g. I tisi mmat er i
alwhet hert heI PCi sori snoti nf orceatt het ime
oratt hepl ace, wher ethecoer cioni sempl oyed( BayofBengal
Capt i
on)
h. Theconsenti sobt ainedbyt hr eatofanof fenceandt heper son
isf or cedt ogivehi sconsent .
i. I tismai nlyofaphy sicalchar act er
j. Thef reedom ofwi ll i
simpai r ed
k. I tisofav iolentchar acter
l. Thebur denofpr oofl i
esuponpl aint i
ff
m. I tmustbeut t
eredwi ththei nt ent ionofcausi ngpl aint
ifftoent er
intoanagr eement
 Thr eatt ost ri
kei snocoer cion
 Compul sionofl awi snotcoer cion
Eff
ectoft hr eatt of i
leasui t:- At hr eatt of il
easui t( Whet herci vi
lor
cri
minal)doesnotamountt o coer ci on,unl esst he sui tison f al
se
charges.Thr eatt of i
leasui tonf al
sechar gesi sanactf orbiddenbyt he
IPCandt huswi llamountt oanactofcoer cion
Eg:-Ahusbandi nducedhi swi fetoent eri ntoacont r
actint hreatof
commi tt
ingsui cide( Chikham Ammi rjajuvSeshama)
 12

EnglishLaw–Dur essdoesnotincl
udedet aini
ngofproper
tyorthreatto
detainpr oper
ty.
-Duresscanbeempl oy
edonlybyapartytot hecontr
actorhi
sagent
-I
tmustbeai medagainsttheli
feorli
bert
yoft hepersonormember sof
hisfami l
y .
-I
tmustbesuchast ocausei
mmedi at
ev i
olence
-I
tmustbesuchast oaff
ectamanwi thordinaryf
ir
mnessofmi nd
Effect-Whencoer ci
onisemployedtoobtai ntheconsentofapar t
y,the
cont r
act
i
sv oidableattheopti
onoft heparty
,wher econsentwasobt ainedby
coer
cion.
Unduei nfl
uence( Section-16)
Sec19( A)(Voi dable)
Meaningofunduei nf
luence–domi natingthewil
loft
heotherpersonto
obt
ainanunf airadvantageov ertheot hers
a.Wher et herelati
onsubsi stingbet weent hepar
ti
esmustbesuch
t
hat
, onepar t
yisinaposi ti
ont odomi nat
ethewil
loft
heother.
b.Thedomi nantpartyusehi sposi ti
on
c.Obtainanunf airadv ant
ageov ertheother
Nothi
ngint hi
sSub- Sectionshallaf fecttheprovi
si
onsofSec111oft he
I
ndianEvi
denceAct .
Undueinf
luence( Secti
on16)
NoPresumpt ionofDomi nat i
onofWi ll
:-

Pr
esumpti
onofDomi
nat
ionofWi
l
l Exampl
es
Ci
rcumst
ances.

*Wher ehehol dsar ealorapparent Mast erand servant ,parent

s and
authorit
yov ertheother. chil
d, Income Tax Of fi
cer and
Assesses, Pr i
nci
pal and
*Wher e he st ands in a Tr ust
Tempor ary Teacher,Tr ust
ee and
fi
duciary(benefit)r
elat
iont
oot her.
Benef i
ciar
y,Spir
it
ualGur uandhi s
*Ment alCapaci tyofa per son is Discipl
es,Sol i
cit
ors and Cl ient
s,
tempor ari
l
yorper manenteffected Guar di
anandWar ds,Relati
onshi
p
byr easonofage,i l
l
nessorment albetween Medi calAt t
endant and
orbodi l
ydistr
ess. War d.

 Inv
olvesuseofmoralf
orce(
mentalpr
essur
e)
 Obtai
nanunfai
radvant
age(i
ntent
ion)
 Notcri
minal
lyl
i
able
 13

 Bet weent hepar tiest ot hecont r

act
 Onepar t
ydomi nat et heot herpar ty
 Voi dableorCour tsetasi de
 Benef it-Or deroft heCour t-Back
- Landl or dandTenant
- Cr edit
orandDebt or
- HusbandandWi f e( ot hert hanPar danashin)
- Principal andAgent
I tismor alorpsy chol ogi cal nat ure
 Theper soni ndomi nat echar acterexploi
tst heweakerper son.
 Thecont racti sei therv oidabl eort hecour tmayenf orceiti na
modi f
iedf or m.
I tisbet weent hepar tiest ot heagr eement
 Unconsci onabl ebar gai ns.
 Ur gentneedofmoney , nodi stress
 Stat ut
or ycompul sion, nodi st r
ess.
 Sec30ofTheSpeci ficRel iefAct ,1963–Suchr el
iefisgrantedt o
restore, whi chmayhav er ecei vedf r
om theot herpar t
yandt omake
anycompensat iont ohi m, whi chjusticemayr equir
e.
Exampl e: -A appl i
est oabankerf oral oanatat ime,whent her eis
str
ingencyi nt hemoneymar ket .Thebankerdecl i
nest omaket hel oan
exceptt oanunusual l
yhi ghr at eofi nterest.Aaccept stheloanont hese
ter
ms.Thi si sat r
ansact ioni nt heor dinarycour seofbusi nessandt he
contractisnoti nducedbyunduei nfluence.
Exampl e: -Aspi ri
tual gur ui nducedhi schel at
odonat eallhi
spr opertyto
theashr am andsai dt hat ,inr etur nofi t,hewi llcertai
nlygetsal vati
on.
Thechel a
didthesame.Hel dt hat ,t hisacaseofunduei nfl
uence,soi tbecomes
v
oid.
Fraud(Sect i
on17)
SeeSect i
on19( Voidabl
e)
Thet ermf r
audmean, afaker epresentati
onoff actsmadewi llf
ulywi
l tha
vi
ewt odeceivetheotherpart
y ,di
shonestt r
ict
,criminaldecepti
on.
--
-Section17-Fraudmeansanyactcommi t
tedbyapar t
yt othecont
ract
orwi thhisconni v
anceorbyhi sagentwi thintentt odeceiveanother
partytheret
oorhi s
agentort oinducetoenterint
ocont ract.

Contract
suber
ri
mafi
des(Cont
ract
sofutmostgoodf
ait
h)
Si
lencedoesnotamounttoarepr
esent
ati
onandsocannotamountt
o
f
raud.
 14

Essent
ial
sofFr
aud:
-
a. Fal sest atement ,madeknowi ngl yorwi t
houtbel iefinit
st ruthor
reckl
esslycar eless, whet heritbetrueorf al
se.
Byapar t
yt ot hecont ract
b. Ther e mustbe r epresentati
on – ( An opinion,a st at
ementof
expression-
doesnof raud)
c. Ther epresent ati
onmustbef alse( Causetobel iev esomethingthat
i
snot
true
d. Bef oreconcl usionofcont r
act
e. Themi sr epresent ationmustbemadewi l
l
full
y
f. Themi srepr esentat i
onmustbemadewi thav iew todecei vethe
other
party
g. Theot herpar tymusthav eact uallybeendecei ved.
h. Theot herpar tyhav esuf f
eredal oss
i
. Thesuggest ion,ast oaf act,ofwhat ,whi
chisnott r
ue,byonewho
doesnotbel ievei tt obet rue.
j
. Theact iveconceal mentofaf actbyonehav ingknowl edgeor
beli
efof
thef act
k. Apr omi semadewi thoutanyint entionofperformi ngit.
l
. Anyot heractf i
tt
edt odecei v
e
m. Anysuchactoromi ssi
onast helaw speci allydeclarest o be
f
raudul
ent
.
I
ntent
ional
l
ymi
srepr
esent
ati
oni
stheessenceoff
raud.
Thesuggest
ion,astothef
actoft
hat,
whichi
snott
ruebyone,
whodoes
notbel
i
eveittobetrue.
Theacti
veconcealmentofafactbyonehavi
ngknowl
edgeorbel
i
efof
t
hef
act
.
Example-Asel ls,byauction,toB,ahor se,whichAsaysnot hi
ngtoB,
abouttheunsoundnessoft hehorse.Thisnotfraudi
nA.
- Ast atementunt rueinf actmustbeunt r
uei nt
hebeli
efofperson
maki ngit
- A mer eexpr essi
onofopi niondoesnotamountt of raud,i
fthe
opi
ni onishonestlyheld.
- Mer esi lenceisnofraud.
- Cav eatempt or(Lett hepurchasebewar e).Itist
hedut yofthe
buyert obecar ef
ul,whil
epur chasi
ngthegoods.
 15

- Sec57( IndianEv i
denceAct1882)–Thegr antorofal i
censei s
boundtodi scl
oset oli
censee,suchdefectsint hepr opert
y.
Excepti
on:Thecont ractisnotvoi
dableinthef ol
lowi ngcases.
 Whent hepar t
ywhoconsentwascausedbysi l
ence,amount sto
fraudandhast hemeansofdi scoveri
ngt het ruthwithor dinar
y
dili
gence.( Example-Classroom)
 Whent hepar tygivetheconsentinignoranceoff raud
 Whent hepar ty,af
terbecomingawar eoff r
aud, takesabenef i
t.
 Whent hepar ti
escannotber estor
edt otheiroriginalposi
tion.
 Wher ei nterestsoft hi
rdparti
esi nt
ervenebef oret hecontractis
av
oided.
Mi
srepr
esent
ati
on(
Sect
ion18)
I
nnocentMi
s-st
atement
/Fal
seSt
atement
Misrepresentationis,whenapar ty(Person)assertssomet hing,whichis
not true, t hough he bel i
ev es t o be t rue. I n ot her wor ds,
misrepresentationisaf alser epresentationmadei nnocent ly.
Anagr eementi ssai dtobei nfluencedbymi sr
epresent ation,ifallthe
fol
lowingcondi tionsaresat i
sfi
ed.
a.Thepar t
ymakesar epresent ati
onoff act(Ther epr esent at
ionbya
stranger)( Byany onewi th hisconni v
anceorbyagent )tot he
contractdoesnotaf fectthev ali
dityofthecont ract.
b.Themi srepresentationwasmadeI nnocently,thati s,itwasnot
madewi thav iewt odecei v etheot herparty.
c.Theot herpar tyhasact uallyactedbel i
evingthemi srepresenttobe
t
rue.
Mi
srepr
esent
ati
oni
ncl
ude:
-
 Unjustif
iedst atementoff acts–posi ti
veasser ti
on-bel
ievedto
bet r
uer eall
ynott r
ue, nobasismi sr
epresentati
on.
 Breachofdut y
I nducingot her st omakemi stakeast oqual i
fyornat ureof
subjectmat ter.
 Knowi nglyorwi thoutbel iefini tstrut
horr eckl
esslycarel
ess
whet heritbet rueorf alse.
 Maki ngofunwar rantedst atement s,whicharenott r
ue.
 Makeami stakeast ot hesubst anceoft hething.
 Af al
sest atementwi thoutanyi ntenti
ont odeceive.
I tdoesnoti nv olvedishonestint enti
on.
 A mer e ex pressi
on of opi nion cannot be r egar
ded as
 16

mi srepresent
ati
on
 Discov eri
ngthetrut
hwi t
hordinarydili
gence
Itneednotbemadedi r
ectl
ytot heplaint
iff
.Itcanbemadet oa
third person withthe int
enti
on ofcommuni cati
ng itt
ot he
plainti
ff,al
soamount stomisrepresentat
ion.
Itmaybe expr ess bywor ds wr i
tt
en int he for
m ofpl ans,
drawi ngs.
Itmusthav ecausedtheconsentoft heotherpartytocont
ract.
Itr equiresuberr
imafidesafiduciaryrel
ati
onshipexist
s.
Itshoul dhavebecomeunt r
ue.
EffectofMisrepresentati
on:-
Rescission–Sect i
on19
Remedy– Sect ion 75/Sect i
on 30/ Secti
on 66/ Secti
on 64/Secti
on 35
(Specifi
cReli
efAct )
1. Ri ghttoResci ndcont r
act :
-
Can’tdo
Discoveringthetruthwi thordinarydil
igence
Giveconsenti nignoranceofmi srepresentati
on
Becomeawar eofmi srepresentati
on, t
akesabenef it
.
Wher eani nnocentt hird party,beforet hecont r
actisr esci
nds
acquires
considerati
on,somei nterestint hepr operty
,passingundert he
contract.
Wher ethepar ti
escannotber estoredt othei
rorigi
nalposi
tion.
2. Ri
ghtt
oinsi
stuponperf
ormance
Ex–Unli
kefr
aud,hecannotsuef
ordamages.

MISTAKE( Sect i
on20-22)
(Void)
Mi stakeErroneousBel i
efaboutsomefacts
Wher eboththepar ti
estoanagr eementar eunderami stake,astot he
matterofthefact,
essent i
altoanagr eementandt heAgreementisv oid.
MistakeofFact/MistakeofLaw-( Secti
on21)
Unil
ateral(
Secti
on22) ,Bil
ateral(Section20).
Excepti
on–Wher econt r
actisnotv al
id(Void)
Secti
on20–Agr eementv oid,wher ebot hparti
esareundermi stakeas
tomat t
eroffact.
Secti
on21–ef f
ectofmi stakesast olaw.
Secti
on22–cont r actcausedbymi stakeofonepar t
yast omat terof
f
act
 17

I
ll
ustration
Aagr eest obuyf rom B,acer tai
nhorse.Ittur
nsoutt hatthehor sewas
deadatt het imeofbar gain,t
houghneit
herpartywasawar eofthefact.
Theagr eementi sv oid.
 The cour tmay r eform the contr
actand r ectif
yt he wri
tt
en
instrument
I gnor ant i
ajuri
snonexcusat( I
gnoranceoflawisnotexcuse)
Classif
icat i
onofmi stake: -
1.Commonmi stake
2.Mut ual mi stake- subj ect mat t
er/
ti
tl
e/ substance of
thing/ root/i
dent i
ty/pr
ice
3.Uni l
at eralmistake
Mi
stakeoff
act
1.Er r
ori
ntheexpr essi
onofcontract( Language)
2.Er r
orwit
hr egar
dt othenat
ureoft er
msoft hecont
ract
3.Er r
ormayr el
atetoreasonorincause
 Mistakewi t
hregardt
othel awoft hecountry
 Mistakewi t
hregardt
ofor eignlaw
 Mistakewi t
hregardt
opr i
v aterights.

b.Stat
ebri
efl
ythevar
iousVoidAgreement
sint
he
I
ndianContr
actActwi
thill
ust
rat
ions.

VOIDAGREEMENTS
Sect
ion2(g)–Anagr eementnotenf orceablebyl awi ssai
dtobevoi
d.
1.Agreementunl
awf ul
inparty(Sect i
on23/ 24)
2.Agreementwit
houtconsiderati
on( Section25)
3.Agreementi
nrestrai
ntofmar ri
age( Sect i
on26)
4.Agreementi
nrestrai
ntoftrade( Section27)
5.Agreementi
nrestrai
ntoflegalpr oceedings( Secti
on28)
6.Agreementwhichisambiguousanduncer tain(Secti
on29)
7.AgreementbywayofWager( Sect i
on30)
8.Agreementtodoani mpossibleact( Secti
on56)
Agr
eementunlawfuli
npar t
y(Secti
on23/ 24)
1.Agreementunl
awf uli
nparty(Sect
ion23/24)
Unl
awfulagr
eements:-Secti
on23def i
nes–t heconsi
der
ati
onoran
obj
ectofagr
eementislawfulunless:
-
 18

1.Iti
sforbi
ddenbyl aw
2.Isofsuchanat ure,ifpermit
ted,itwoul
ddefeattheprovisi
onsof
anylaw
3.Inv
olvi
ngani nj
uryt othepersonorpr oper
tyofanother.
4.Isfr
audulent
5.Immoral:Theobj ectofconsi derati
onofwhichisimmor al,
isvoi
d
andcannotbeenf or
ced.
 Deal i
ngwi t
hsexwor kers
I ll
egal cohabi t
ation
 Danci nggi r
ls
6.Opposedt opubl i
cpol icy :Anagr eement ,whichi sinjuri
oustot he
publi
coragai nstthei nter estofsoci ety,i
ssai dt obeopposedt o
publi
cpol i
cy .
a.Tr adingwi t
henemy .
b.Host ileacttowar dsaf riendl ystate.
c.Byst ifli
ngacr i
minal prosecut ion.
d.Abuseofl egal process- mai ntenanceandchamper ty.
e.Byi nterfer
encewi ththecour seofj usti
ce.
f.Agr eement swhi chcr eat econf li
ctsofinterestanddut y.
g.Mar riagebr eakagecont r acts.
h.Sal eandpubl i
cof fi
cer s.
Secti
on24: Whenconsi derat i
onsandobj ectsareunl awf ulinpart
:ifany
partofasingleconsi derationf oroneormor eobj ectsorany oneorany
partofanyoneoft hesev eral consi derations,forasi ngleobj ecti
s
unl
awf ul
,theagr eementi sv oid.
Agreementwi t
houtconsi der ation( Sect i
on25)
Secti
on25-Anagr eementwi thoutconsi derati
oni sv oid.Ev ery
agreementmustbesuppor tedwi thsomeconsi deration, thenonlyi
t
becomesacont ractSect ion2( d)def i
nesconsi deration.

Agr
eementinrest r
aintofmar r
iage( Sect
ion26)
 Anagreement ,whichinterfer
eswi ththeperfor
manceofmar i
tal
duti
es,againstthepublicpolicy,i
sv oi
d
 Everyagreementi srestr
aintofthemar ri
ageofanyperson,ot
her
thanami nor,i
sv oid
 Anagreementwhi chrestri
ctsaper son’
sfreedom otmarr
yorto
marryanyper sonofhi schoiceagainstPP, i
svoid
 19

Forexample-Anagreementt
olandmoneytoawomanin
consi
derati
onof
hergett
ingadiv
orceandmarryi
ngthel
ender
,isv
oid.
Agreementi nr est raintoft rade( Sect ion27)
 Ev eryagr eementbywhi chany onei sr etr
ai nedf rom exer cisinga
l
awf ul pr of ession, tr
adeorbusi nessofanyki nd, istot hatext ent,
void.
 Ai m –av oi dingcompet i
tionandhasmonopol ist i
ct endency
 Anagr eementnott ocar ryonsomebusi nessf oraper iodof3
yearsort ocl osedownami ll f
or3mont hsi nay ear ,isv oid.
 Bot ht hegener al aswel laspar tialrest r
aintoft r adei spr imaf acie,
void.
EXCEPTI ONS:
1.Sal eofgoodwi ll
: -Aper sonwi thitsgoodwi l
l,thesel l
eroft he
business, maymakeanagr eementwi ththebuy er ,
nott ocar r
yon
thebusi nessi ncompet i
tionwi ththebuy er.Suchanagr eement ,i
f
i
mposesar easonabl er estrictionont hesel ler’sr ightt ocar ryon
businessi sv alid.
2.Except i
onundert heIndi anPar tnershi pAct ,1923: -
Sect i
on11( 2): Thepur posei st hatt hepar tnerswi l
l notcar ryon
theirownbusi nessi gnor ingt hepar tnershi pbusi ness.Suchan
agreementi sv alid.
Sect i
on36( 2): I
tmaybemadebet weent heout goi ngpar t
nerand
ther emai ningpar tners,whocont i
nuet hebusi nessoft hef irm.
Sect i
on54: I
tmaybemadeuponori nant icipat ionoft he
dissol utionoff irm.
Sect ion55( 3):Whenaper sonpur chasest hegoodwi llofa
business, hisint erestmaybepr otect edbyacov enantbyt hesel l
er
ofgoodwi l
l,thatt hel atterwi llnotcar ryonbusi nesssi mi lart othe
onewhi chhasbeensol d.
3.Rest raintbyacont ractofser vice: Anagr eementofaser viceunder
whichanempl oy eeagr eest hathewi llser veapar t
icularempl oyer
forcer taindur at i
onandt hathewi llnotser v eany oneel sedur ing
thatper i
od, isv alid.
4.Tr adecombi nat i
on: Somet rader sandmanuf act urer scombi ne
toget hert oel i
mi nat ecompet iti
onasbet weent hemsel v esand
makeagr eementf i
xingmi nimum pr i
ce, regul atingt hesuppl yof
 20

goodsandput t
ingpr ofi
tsi
nacommonpool anddivi
ngthesame
amongstt hemsel ves.
5.Solusagr eement s:Thesel lerorthemanufact
urersofacer tai
n
productmayagr eet hathewi l
lappl
ythewhol
eofhisproducttoa
parti
cularsinglebuy eronl
yorsi mil
arl
yabuyermayagr eethathe
willpurchaseal lhisr equi
rementsofacertai
ncommodi t
yfrom a
parti
cularselleror
manuf actureronlyandoneel se;i
svali
d.
Agr
eementi
nrest
rai
ntofl
egal
proceedi
ngs(
Sect
ion28)
Section28: AnAgr eementabsol utelyrestrai
ningapar t
yfrom enf
orci
ng
hisri
ght sthroughacour toflaw, oranagr eementwhi chplacesalimitas
totimewi t
hinar i
ghtcanbeenf or ceableisvoid.
Twoki ndsofAgr eementsarev oid.
1.Agr eementbyonepar t
yisabsol utel
ybar redfr
om enfor
cinghis
ri
ghtsthroughusual l
egal proceedings
2.Agr eementwhi chplacesat i
mef orenforcingari
ghtthr
oughlegal
proceedings.
Ambi
guousanduncer
tai
nAgr
eement
s(Sect
ion29)
Secti
on29:Whichi
snotcert
ainorcapableofbei
ngmadecertai
n,ar
e
voi
d.Itis
necessar
ythatt
her
eshouldbenoambi guit
yaboutwhatt
hatpart
ies
i
ntend.
I
ll
ustr
ati
ons:‘
A’agreest
osel
lto‘
B’ahundr
edtonsofoil
.Ther
eis
nothi
ngwhatevert
oshowwhatki
ndofoilwasint
ended.Theagr
eement
wasv oi
dfor
uncer
tai
nty.
Agr
eementbywayofwager(
Sect
ion30)
Essent
ial
sofWageragr
eement
:
i
. Thepar
ti
eshav
eopposi
tev
iewsr
egar
dinganuncer
tai
nev
ent
.
i
i. Therearechancesofgai
norlosst
othepar
ti
esont
he
det
ermi
nat
ionofthe
ev
entonewayoft heot
her.
i
i
i. Thepar
ti
eshav
enoot
heri
nter
estexceptwi
nni
ngorl
osi
ngabet
.
‘
A’agr
eest
opay‘
B’Rs.
100,
ifi
tdoesnotr
ainon1stJanuar
y.Next
 21

‘
B’ agr
eest opay‘ A’ Rs.100ifitrai
nsonthatday( Winorloss
dependingupont hedet erminationoft
heev ent)
.
Ify outakeani nsur ancepol i
cytoinsur
eTaj Mahal orKutubMinar-
void
 Butifitisforyourownhouse-v ali
d
 Theagr eementt opaypr izemoneyorlotter
yt i
ckets-v oi
d
 Speculativ
et r
ansact ion:Anagr eementtopaydifferencesonl
y,
rather
thanactuallymaki ngort akingthedeli
veryofthegoods.
Cont
ingentCont
ract
s(Sect
ion31)
Iti
sacont r
actt odoornott odosomething,
ifsomeev ent
, col
lat
eralt
o
suchcontractdoesnothappen.Whent hecontracti
sdependentor
condi
ti
onal upont hehappeningornon-
happeningofacertainfut
ure
event
,thecont racti
sconti
ngent.
‘A’cont ractst
opay‘B’ Rs.
10,
000,i
f‘B’
shousei sbur
nt .Thi
si sa
contingentcontr
act.
 Allcontractsofi
nsurance.
Enf
orcementofCont i
ngentcontr
act:-
1.Section32:Contractsconti
ngentonanev enthappening
2.Section33:Contractsconti
ngentonanev entnothappening
3.Section34:Contractsconti
ngentont hefutureconductofal i
vi
ng
person
4.Section35:Contractsconti
ngentonhappeni ngofaspeci fi
ed
eventwithi
naf i
xedt i
me.
5.Contract
scontingentonnothappeni ngofaspeci fi
edev entwithi
n
afixedti
me.
6.Section36:Agreement sconti
ngentoni mpossibleevent.

Q.
2
a.APr omisest
opayasum ofmoneyifacertai
n
shi
pdoesnotr etur
nwithi
nayear
.Theshipnever
ret
urns;canBrecovert
hemoneyfrom A?
-
Yes
-Bcanrecov
erthemoneyf
rom A.Bcanenf
orcet
hecont
ract
,ift
heshi
p
does
notret
urnwit
hinayear
.
-
Acont
ractt
odoornott
odosomet
hing,
ifsomeev
encol
l
ater
alt
osuch
 22

cont
ractdoesnothappen.
-Reasons–Thepromisei
sdependentorcondi
ti
onaluponthehappeni
ng
ornon-
happeningofacer
tai
nfut
ureevent
,thecont
racti
sconti
ngent.

Enf
orcementofcont
ingentcont
ract
 Secti
on32: Contract
sconti
ngentonanev enthappening
 Secti
on33: Contract
sconti
ngentonanev entnothappeni ng
 Secti
on34: Contract
sconti
ngentonthefutureconductofal i
vi
ng
person
 Secti
on35: Contract
sconti
ngentonhappeningofaspeci fi
ed
eventwithinaf i
xedtime.
Contr
actsconti
ngentonnothappeni ngofaspeci f
iedeventwi t
hina
fi
xedti
me.
 Secti
on36: Agreementsconti
ngentonimpossibleevent.
 Thewager i
ngagreementisalsoacontingentcontract,but
thattypeofcont i
ngentcont
racthasbeenspecificall
y
declaredtobev oidbySecti
on30.

Al
lcont
ractofi
nsur
anceori
ndemni
tyai
m atpay
mentof
moneyonlyafteracer
tainev
enhappens,orthel
ossi
s
causedandtheref
oretheyar
econt
ingentcontr
act
.

b.M,tel
l
shiswifethathewouldcommitsuici
deif
shedidnott
ransf
erherpersonal
asset
stohi m.
Shedoessoundert hr
eat
.Canwi f
eavoi
dt his
cont
ract
?
-Yes

-
Wif
ecanav
oidt
hiscont
ract.

-Becauset hi
scontracti
scausedbyCo- er
cion,asdefinedi
nSecti
on15.
Accor di
ngt oSect
ion14,consentissaidtobefreefr
om coerci
on.
Accor di
ngt oSect
ion10oftheact ,t
hereshouldbefreeconsent(
Val
id
contract)oftheparti
es,
whent heyenteri
ntotheagreement.
 23

Reasons–
Secti
on15defi
nescoer
cion-Theconsenti
sgi
venundert
het
hreat
,isan
off
enceunderI
PC.
 Theconsentisobtai
nedbythr
eatofanof
fenceandt
heper
soni
s
for
cedtogivehisconsent
.
I
tismai
nlyofaphy
sical
char
act
er.

 Thef
reedom ofwi
l
lisi
mpai
red

I
tisv
iol
entchar
act
er

 Theagreementmadebycoer
cioni
svoi
dabl
eatt
heopt
ionoft
he
par
tywhosewassocaused.

 Thebur
denofpr
oofl
i
esupont
hepl
aint
if
f

 Thepart
yavoidi
ngthecont
racti
sboundtorest
oret
otheother
par
tyanybenefi
t,whi
chhemayhaverecei
vedundert
hecontract
.

 Thereal
orapparentauthor
it
y,whi
choneper
sonhasov
eranot
her
-
Sect
ion16-Undueinfl
uence.

 Confidenceresponsebyonepar
tyi
nanot
her(
Fiduci
ary
r
elat
ionship)
.

Uni
t3
Q.
1
a.St
atet
herul
esrel
ati
ngtoappr
opr
iat
ionof
payment
sbetweendebt
orandcr
edi
tor
.
Perf
ormanceofCont ract–Ever
ycontr
actconsi
stsofreci
procal
promises.Eachpartytoacontr
acti
sboundtoperfor
mt hepromise
madebyhi m( Sect
ion59to61).

Theparti
estothecontr
acthav
eadut
yto:
-
1. Per f
orm
2. Of f
ertoperf
orm
Thei
rrespect
ivepr
omises.
 24

Joi
ntpr
omi
sor
sandt
henat
ureoft
hei
rli
abi
l
ity(
Sect
ion42)
:-
Dev
olut
ionofj
ointl
i
abi
l
iti
es.
Secti
ons42,43and44ofTheCont
ractActdeal
swi
tht
hel
i
abi
l
ity
,rul
es
are
contai
nedi
nt hesesect
ions.
Sect
ion43–Anyoneoft
hej
ointpr
omi
sormaybecompel
l
edt
oper
for
m
Sect
ion44–Ef
fectofRel
easeofonej
ointpr
omi
sor
.
Ti
meandpl
aceofper
for
mance
Secti
ons46to50laydowntheprinci
plesfort
heper
for
manceof
contr
act
s,cont
aini
ngdif
fer
entst
ipulat
ionsastot
imeandpl
acefort
he
perf
ormanceofthe
contr
act
s.
Sect
ion46–Ti
meforper
for
manceofpr
omi
se,
wher
enoappl
i
cat
ioni
s
tobe
madeandnoti
mespeci
fi
ed.
Secti
ons47-Ti
meandplaceofper
for
manceofpr
omi
se,
wher
eti
mei
s
speci
fi
edandnoappl
i
cat
ionbemade.

Secti
ons48–Appli
cat
ionf
orper
for
manceoncer
tai
nday
,tobeat
propert
imeandpl
ace.

Sect
ions49–Placef
orperf
ormance,
wher
enoappl
i
cat
iont
obemade
andno
pl
aceisfi
xedf
orperf
ormance.
Secti
ons50-Perf
ormancei
nthemanneroratat
ime,
prescr
ibedor
sanct
ioned
bythepromisee.
Per
for
manceofr
eci
procalpr
omi
ses-
Sect
ions51t
o54deal
wit
htheper
for
manceofr
eci
procal
promi
ses.
Appr
opr
iat
ionofPay
ment
s–(
Sect
ions59t
o61)
Appr
opr
iat
ionmeansappl
i
cat
ionofpay
ment
s-
-
Thequest
ionofappr
opr
iat
ionofpay
ment
sar
iseswhenadebt
orowes
sev
eral
debt
stot
hesamecr
edi
torandmakesapay
mentt
hati
snot
suf
fi
cientt
odi
schar
get
hewhol
eindebt
edness.
 25

1. Appr
opr
iat
ionofpay
ment
s
Somet
imes,adebt
orowessev
eraldi
sti
nctdebt
stot
hesame
cr
edi
torandhemakesapay
ment
,whi
chi
sinsuf
fi
ci
entt
osat
isf
yal
lthe
debt
s.I
nsuchacase,aquest
ionar
isesast
owhi
chpar
ti
cul
ardebtt
he
pay
menti
stobeappr
opr
iat
ed.Sect
ion59t
o61oft
heAct
,laydown
f
oll
owi
ng r
ules as t
o appr
opr
iat
ion ofpay
ment
s,whi
ch pr
ovi
de an
answert
othi
squest
ion.
Appr
opr
iat
ionasperexpr
essi
nst
ruct
ions
Ev
erydebt
orwhoowessev
eraldebt
stoacr
edi
torhasar
ightt
oinst
ruct
hi
scr
edi
tort
owhi
chpar
ti
cul
ardebt
s,t
hepay
menti
stobeappr
opr
iat
ed
oradj
ust
ed. Ther
efor
e,wher
ethedebt
orexpr
essl
yst
atest
hatt
he
pay
menti
sto beappl
i
ed t
othedi
schar
geofapar
ti
cul
ardebt
,the
pay
mentmustbeappl
i
edaccor
dingl
y.
Exampl
e-AowesBt
hreedi
sti
nctdebt
sofRs.
2,000,
3,000and5,
000.A
sendsRs.
5,000andi
nst
ruct
sBt
hatt
hepay
mentshoul
dbeappr
opr
iat
ed
agai
nstt
het
hir
ddebt
.Hei
sboundt
oappr
opr
iat
ethepay
mentagai
nst
t
het
hir
ddebtonl
y.
Appr
opr
iat
ionasdesi
redbyt
hedebt
or
Theappl
i
cat
ionofpay
mentofdebti
slef
tent
ir
elyt
othedi
scr
eti
onoft
he
debt
or.I
fthedebt
orf
ail
stogi
veanyi
nst
ruct
ions,
thecr
edi
torcanappl
y
t
heamountt
oanyoft
hedebt
sincl
udi
ngat
imebar
reddebt
.
Whent
hedebt
orhast
omakepay
mentundermul
ti
pleheads,
hehasan
opt
ioni
nSect
ion59t
oindi
cat
etheheadt
owhi
cht
heamountpai
d
shoul
dbeappr
opr
iat
ed
2. Appli
cati
onofpay
ment
,wher
edebtt
obedi
schar
gedi
snot
i
ndicated
(Sect
ion60)
.
I
fSecti
on60isattract
ed,t
hecredi
torshal
lhav
ethediscret
ionto
applysuchpaymentforanylawf
uldebt,
whichisduetohi
mf rom the
personmakingthepayment.
 26

Example-Aowest
oB, amongotherdebts,
asum ofRs.520.Bwrit
est
o
Aanddemandspaymentofthissum.Asendst oBRs.520.This
paymentist
obeappli
edtothedischar
geofthedebtofwhichBhad
demandedpayment
.

 Appr opr i
ati
onbyt hecr edit
or– Ifthedebtorf ai
l
st omakeany
i
ndi cationofhisintent
ion,thecredit
orhasar ighttoappr opri
ate
theamountt oanydebtpr ovi
ded,iti
slawful
lydue,event houghit
maybet i
mebar red. Hecannotmaket heappropriat
iont oan
i
llegal orvoiddebt
.
3. Appl icationofpayment,wher enei
therpar
tyappropri
ates
(Sect ion61)
Thepay mentshal lbeappl i
edindischargeofthedebtsinorderof
ti
me,whet hert heyareorar enotbarredbyt heLimi
tat
ionAct,1963.If
thedebtsar eofequalst anding(Thatispay ableonthesamedat e)
,the
payment shal lbe appl i
ed i n di
scharge of each of t hese debt
proport
ionat ely.
Fi
rsti nterestt
henpr i
nciple
Directorofpay ernotreceiver
Ri
ghtpr imaryofthedebt or
Appr
opr
iat
iont
owar
dsdebt
sinor
deroft
ime-
Whennei t
hert hedebtornorthecr edit
ormakeanyappr opri
ati
on,then
therulement i
onedi nSect
ion61det erminestowhi chamounti stobe
appli
edf ordischargi
ngwhichparti
culardebt.
Insuchacase,t hepaymentshal lnotbeappl i
edi ndischarge,ofthe
debtsinor deroft ime.Theol destonei stobedi schar
gedf ir
stofall
,
event houghi tmaybeat i
mebar reddebt.I fthedebt sar eequal
standi
ng,t hepay mentshallbeappl i
edindischargeofeachsuchdebt
proporti
onately.

(Whateveri
spaid,paidaccor di
ngtotheint
enti
onofpayingit
)
(
Quickquidsoi
vitur
, sov i
tursecundum modem sol
venti
es)
Example-AowesB, thef ollowingdebts:-
AmountandPosi ti
onsoft hedebt s:
Rs.2,
000 Ti mebar r
ed
Rs.1,
000 Ti mebar r
ed
Rs. 000 Dueon10thJune
2,
Rs. 000 Dueon20thSept
3, ember
A sendsRs.
1,500inthemont
hofJune. Henei
therexpr
essl
y
i
nti
matesnorcir
cumstancesoft
hecasei
mplyastowhichdebtthe
 27

amounti st obeappl iedMor eover

,B alsodoesnotappr opr
iat
et he
paymentathi s own di scret
ion. Therefore,the paymentwillbe
appropri
atedinor deroftime.Howev erhere,inthi
scase,twodebtsare
ofequalst anding.Thepay mentwi l
lther
efore,beappropr
iat
edinorder
oftime,butt oal lequalstandi
ngdebt s.Int hi
scase,Rs.1,
500willbe
appropri
atedt owardsthefir
sttwodebtsofequal st
anding
proport
ionately,t
hatisintherati
oof2:1.
Therul
esment i
onedi
nSecti
ons59t o61,al
thougharemeantf
orbei
ng
appl
i
edt o sev
eraldi
sti
nctdebts,thesamepr i
nci
plesar
eappli
cabl
e
whenther
eisasingl
edebtandinter
estther
eon.

b.Explai
ntheDoctr
ineofFr
ust
rat
ionwi
th
ref
erencetodeci
dedcases.
DischargeofCont
ract
:Itmeansacont ractceasestooperat
e.I
talso
meanst heri
ghtsandobli
gati
onscreatedbyt hecontr
actcometoanend.
Thet er
minati
onofthecontr
actual
relati
onshipbetweenthepar
ties.

1.Byper
for
mance(
Sec37-
67)

2.Byi
mpossi
bil
i
tyofper
for
mance(
Sec56)

3.Byagr
eement(
Sec62-
67)

4.Bybr
each(
Sec39)

Annul,
li
abi
li
tyf
ulf
il
lment
,tocancel
,tor
elease,
dismi
ss,
tor
eli
eve
obl
igati
on.

1.Di
schar
gebyper
for
manceorDoct
ri
neofFr
ust
rat
ion

Frustr
ati
on:ef
for
tsmadeineff
ect
ive:
discont
ent
edbecauseunabl
eto
achieveone’
sdesi
re:
disappoi
ntahope;

Whent heperformanceoft hecontr

actbecomesi mpossibl
ethepurpose
whichthepartieshaveinmi ndisfr
ustr
ated.Iftheperf
ormance
becomesimpossi ble,becauseofasuperveningevent
,thepromisori
s
excusedfr
om t heperformanceofthecontract.InEngl
ishl
aw, i
tis
call
ed“Doctr
ineofFr ustr
ation”
.InIndi
anLaw, iti
scall
edas
“I
mpossibi
li
tyofPer formance”.

Sec56oft
heI
ndi
anCont
ractAct
,1872:
thi
sdoct
ri
nei
sappl
i
cabl
eint
wo
 28

ci
rcumstances(i
)whentheperf
ormanceofthecont
ractwasphy
sical
l
y
cutof
f;and(ii
)whentheobj
ectwasfai
led.

Sec56:Agreementt
odoi
mpossi
bleAct
-anagr
eementt
odoi
mpossi
ble
i
nitsel
fisv
oid.

I
ll
ust
rat
ions:

a.Aagreeswi
thBt
odi
scov
ert
reasur
ebymagi
c.Theagr
eementi
s
voi
d.

b.AandBcontr
actt
omarryeachother
.Befor
ethet
imef
ixedf
ort
he
marr
iage,
Agoesmad.Thecont
ractbecomesvoi
d.

Rul
es:Sec56expl
ainst
hecircumstancesi
nwhi
chtheDoct
ri
neof
Fr
ustr
ati
onari
ses.Theingr
edient
sofSec56areasfol
l
ows:

i
.Theagr
eementi
stodoani
mpossi
bleacti
sini
tsel
fvoi
d.

i
i
. Acont
racttodoanactbecomesi
mpossibleorunl
awf
ulbyan
ev
entwhichthepr
omisorcoul
dnotf
oresee.

i
i
i. Thepr omisorknewormighthav eknownwithreasonable
dil
igencethattheacthepr
omisedi simpossi
bleorunlawful
,but
thepromisedidnotknowofit,insuchcir
cumst ances,
the
promisori
shel dli
abl
etopaycompensat i
ontot hepromisefor
anylossoccurredbythepromiseforthenon-perf
ormanceof
thepromise.

i
v. I
ll
ust
rati
onsappendedt
oSec56cl
ari
fyandgi
vepr
oposi
ti
onsof
t
hisdoctr
ine.

Eff
ectofFr
ustr
ation:
iti
swell
sett
ledt
hatifandwhenther
eis
fr
ustr
ati
onthedissol
uti
onofthecont
ractoccur
saut
omatical
l
y.

1.Thefr
ustr
ati
onsshoul
dnotbeself-
induced:Fr
ust
rat
ionshoul
d
ari
sewit
houtbl
ameorfaul
toneitherside.Rel
i
ancecannotbe
pl
acedonaselfi
nducedfr
ust
rat
ion.

2.Frustrat
ionmustoper at
eaut omati
cally
:Frustrat
ionoper ates
automat i
call
ytodischar
get hecontract“i
rrespecti
veoft he
i
ndividual’
sconcerned,t
heirtemperament sandf ai
lings,thei
r
i
nterestandci r
cumstances”.Thelegaleffectsoffrustrat
iondonot
 29

dependont heiri
ntenti
onort heiropini
onsorevenknowl
edge,as
totheev ent.Thisisparti
cularlytrueofIndi
anl
awasSec56oft he
ContractActl aysdownar uleofposi ti
velaw.Theremustnotbe
anti
cipation,knowledgeorintent i
onofthepart
ies.

3.Adjustmentofrights(
Resti
tut
ion):Sec65, obligat
ionoft heperson
whohasr ecei
vedadv ant
ageunderv oi
dagr eement ,orcontr
act
thatbecomesv oid-whenanagreementi sdi scoveredtobev oid,or
whent hecontr
actbecomesv oid,anypersonwhohasr eceivedany
advantageundersuchagreementorcont racti sboundt orestoreit
,
ortomakecompensat i
onforit,
tot hepersonf rom whom he
deceivedi
t.

4.Asar
esul
toff
rust
rat
ion,
thecont
ractbecomesv
oid.

5.Thedoct
ri
neofQuantum Mer
uiti
sal
l
owedi
ncasesoff
rust
rat
ions,
wher
everpossi
ble.

GroundsofFrust
rat
ion:Fol
l
owi ngar
ethewellr
ecogni
zedgr
oundsof
fr
ustrat
iononwhichthedoctr
ineoffr
ust
rat
ionmaybeappli
edbythe
court
s:

1.Dest
ruct
ionoft
hesubj
ectmat
teroft
hecont
ract
:

Wheretheperf
ormanceofthecontr
actbecomesimpossi
blebyt he
dest
ructi
onofthespeci
fi
cthi
ngtothatperf
ormancet
hatcontractis
di
scharged.Thedestr
ucti
onofthemusichall
Tayl
orv/sCaldwellcase
i
sagoodexampl e.

2.Non-
occur
renceofapar
ti
cul
arst
ageoft
het
hing:

Thedoctri
neoffr
ust
rati
onhasal
sobeenappli
edincasesofnon-
occurr
enceofapart
icul
arev
entwhi
chisessent
ialf
ortheper
formance
ofthecontr
act
.

3.Deat
hori
ncapaci
tyoft
hepar
ty:

Wher etheper
for
manceofacont ractdependsupontheper sonal
servi
cesofaparty,t
hedeathorincapacit
yofsuchapar t
ymaybe
tr
eatedt obeacal
idgroundforf
rustrati
onofthecontr
act.Al eadi
ng
caseont hepoi
ntisRobinsonv/
sDav i
nson.I
nthiscase,the
defendant’
swif
ewasaf amouspiani
st.Shecontract
edforper for
minga
 30

concertbutcouldnotf ul
fi
ll
herpr omisebecausefornon-perf
ormance
(breach)ofcontract.Thecour thel
dthatinthi
scaset heconti
nued
healthofthepianistwasacondi ti
onat t
achedtotheagreement.Her
seriousil
lnesswasav al
i
dgr oundont hebasisofwhichshewas
dischargedfrom herobli
gati
onundert hecontract
.

4.Changeofci
rcumst
ances:

Ifthechangeofcircumst ancesmakest heperformanceofthecontract

i
mpossi ble,
thecont r
actwillfr
ust
rateandpar t
ieswil
lbedischarged
from thei
robli
gat
ionsundert hecont r
act.I
f,however,despi
tethe
changeofci r
cumst ancestheperformanceisst i
l
lpossibl
ethecontract
wi l
lnotbedeemedt ohavebeendi schar
ged.

5.Bui
l
dingcont
ract
s:

Wheretheexecuti
onofthecont racti
sdelay
edorot her
wisebecomes
i
mpossiblebythehappeningofanext er
nalevent,
thecontracti
s
di
scharged.Butmuchwi l
l dependuponthefactsandcircumstances
andeachcasehast obejudgedoni t
sownmer i
ts.

6.Changei
nlaw:

Theper for
manceofacontractmaybealsobecomel egal
lyimpossi
ble
bythechangei nl
aw.Iftheperf
ormanceislegal
l
yimpossible,
the
contractwil
lbedi
schar
ged.ButaspointedinAnson’sLawofCont r
act,
“t
hechangei nthel
awmustbesuchast ostri
keattherootofthe
agreementandnotmer el
ytosuspendorhinderi
tsoperati
oninpart
.

7.Legi
slat
iveorgov
ernmenti
nter
vent
ion:

Aret
hewell
-r
ecognizedgr
oundsoff
rust
rati
ononwhi
chthedoct
ri
neof
fr
ust
rat
iononwhichthedoct
ri
neoffr
ustr
ati
onmaybeappli
edbycour
ts.

Q.
2
a.Amusicalhal
lwasagreedt
oletoutoncert
ain
day,
butbeforet
hat,
itwasdest
royedbyfi
re.Isthe
 31

pr
omi
sorabsol
vedf
rom t
hecont
ract
?
 Yes.

 Thepr
omi
sori
sabsol
utel
yabsol
vedf
rom t
hecont
ract
.

 Thepr
omi
sori
snotl
i
abl
efort
henon-
per
for
manceoft
hecont
ract
.

 Because,
byi
mpossi
bil
i
tyofper
for
mance(
Sect
ion56)

 Theperformanceofthecontr
acthadbecomev oi
d.Beforethe
dateofperformancear
riv
ed,themusi
challwasdestr
oyedbyf ir
e.
Thecontractwaspossibl
ewhenthecontracti
senter
edinto,but
becauseoff i
re,
theper
formance,
subsequentl
ybecame
i
mpossibleorunlawful
.

 Theperfor
manceisdeemedtobeimpossi
bleandt
hepar
ti
esar
e
excusedfr
om per
for
mingthecont
ract
.

Di
schargeofcont ract:
I
nthefoll
owi ngway s:
 Byper for
manceoft hecont r
act–Secti
on37t o67.
 Bybr eachoft hecontract–Section39
 Byimpossi bili
tyofperformance–Section56
 Byagr eementandnov ation–Sectiont
o67
 Dischargebyi mpossibili
tyofperf
ormance:anagreementtodoan
actimpossi bleinit
sel
f, i
svoid,
whichbecomesunenf or
ceabl
e.

Init
ial
impossi
bil
i
ty:
-
‘Lesnoncogi
tadimpossibil
i
a’-t
helawdoesnotcompel
amant
o
dowhathecannotpossiblyperf
orm.

I
mpossi
bil
i
tyheremeansnotonlyphy
sical
impossi
bil
i
ty,
butal
so
l
egal
impossi
bil
i
ty(Sect
ion23)
 32

 Subsequenti
mpossi
bil
i
ty:
-

 Theperformanceofthecont
ractmaybepossi
blewhent he
contr
actisenter
edinto,
butbecauseofsomeevent,t
he
perf
ormancemaysubsequent l
ybecomeimpossibl
eorunlawf
ul

 Sothepur posewhichtheparti
eshaveinmi ndisfr
ustrated.Ifthe
perfor
mancebecomesi mpossibl
e,becauseofasuper veningevent,
thepromisorisexcusedfrom t
heperformanceoft hecontract.
Thisisknownas‘ Doctr
ineofFrust
rati
on’undertheEnglishLaw.

b.X,
Y,andZ,
joint
lypromisetopayRs.
30,
000/-to
D.Ybecomesinsolv
ent.Discusst
heli
abi
l
ityofX,
Y,
andZ.
-
Yes,
X,Y,
Zhav
ethel
i
abi
l
ityt
opayRs.
30,
000t
oD.

-ButYbecomesinsol
vent.SonowXandZar ecompell
edt opaythe
amounttoD,mayhav eperf
ormedthewholeoft
hepromiseandthey
haveri
ghttocl
aimthecompensati
onfrom Yort
hei
rrepresent
ati
ves
l
ateron.

Theyar
eent
it
ledt
orecei
veRs.
10,
000/
-fr
om Y.

Sect
ion42,43and44oftheCont
ractActdeal
wit
hthequest
ionof
l
iabi
l
ityoft
hejoi
ntpr
omisor.
Thel i
abil
i
tyofJointPr omisorisjointandsev er
al:Whent woormor e
personsmakeaj ointpromi se,t
hepr omisemay ,i
nt heabsenceof
expressagreementtothecont r
ary
, compelany oneormor eofsuchjoi
nt
promisorstoperf
ormt hewhol eofthepr omise.Theirl
iabil
i
tytopaythe
moneyi sjoi
ntandseveralunderSection43oft heContractAct
.

Cont
ri
bution between jointpromisors:Sincet heli
abil
ityoft hejoint
pr
omisorsisj ointandsev er
al,oneoft hem mayhav eper for
medt he
whol
eoft hepr omi se.Hemayhav e,forinst
ance,pai
df ortheshareof
ot
hersalso. Ift hatisso,hehasr i
ghtt oclai
m contr
ibuti
onf rom t
he
ot
hers(Sect
ion43)

Ef
fectofr
eleaseofaj
ointpr
omi
sor
:Sect
ion44oft
heI
ndi
anCont
ract
 33

Act,1872:“ Whentwoormor eper sonshav emadeaj oi

ntpromi se,a
rel
easeofonesuchj oi
ntpromisorsbyt hepromisee,doesnotdischarge
theotherj oi
ntpromisor
s,neitherdoesi tf r
eet hejointpr
omi sorso
rel
easedfrom ther
esponsi
bil
it
yt ootherjoi
ntpromisors.

Effectofdeat hofaj oi
ntpr omisor:Secti
on42:Ont hedeathofajoint
promi sor
,hisrepresent
ati
vessubst it
utehimf orthepurposeofli
abil
i
ty.
Thel iabi
lit
yoft hesur v
ivi
ngj ointpromisorsist here,al
ongwiththe
representati
vesoft hedeceasedone.Whenal lj
ointpromisor
sdie,t
he
representati
vesofthem all
mustj oi
ntly,
fulf
il
lthepromise.

Uni
t4
Q.
1
a.Di
scussther
emedi
esav
ail
abl
eforbr
eachof
Cont
ract.
REMEDI
ESFORTHEBREACHOFCONTRACT

Remedymeanscour seofact
ionavai
l
abl
etoanaggr
iev
edpar
ty,
when
otherpar
tybr
eachesthecont
ract
.

Remedi
esf
orBr
eachofCont
ract
1. Resci
ssi
onofCont
ract–Sect
ion39

2. Sui
tforDamages–Sect
ions73t
o75

3. Sui
tforSpeci
fi
cper
for
mance(
TheSpeci
fi
cRel
i
efAct1963)

4. Sui
tforI
njunct
ion–Sect
ions36t
o44ofSpeci
fi
cRel
i
efAct
,
1963

5. Quant
um Mer
uit

Resci
ssi
onofCont
ract–Sect
ion39
I
tmeansr
ightt
opart
ytocancel
contr
act.
Incaseofbr
eachofcont
ract
,otherpar
tymayr
esci
ndcont
ract
.
Ef
fectofResci
ssi
onofcont
ract
Aggr
iev
edpar
tyi
snotr
equi
redt
oper
for
m hi
spar
tofobl
i
gat
ionsunder
 34

cont
ract
Aggr
iev
edpar
tycl
aimscompensat
ionf
oranyl
oss.
Par
tyi
sli
abl
etor
est
orebenef
it
,ifany
.
WhencanCour
tGr
antResci
ndCont
ract
?
Cour
tcanr
escindt
hecontract
,int
hef
oll
owi
ngsi
tuat
ions:
Whencont
racti
svoi
dable
Whencont
racti
sunlawf
ul
Damages–Sect
ions73t
o75
Theamountofmoneyal
l
owedbyacour
tascompensat
ionf
ort
he
vi
olat
ionofadut
y.

Ki
ndsofDamages
1.Liquidated
2.Unliquidated
3.Ordinar y/General/
Usual
courseofthi
ngs
4.Speci al
5.Vindictive/exemplary–noplaceofpuni
shment(Promisetomar
ry)
6.Nomi nal -absenceofconcr
etemateri
altoshowtheextentof
damage
7.Loss/ reputati
on
8.Inconv enience/ di
scomf
ort
-equalt
otort
uousli
abil
i
ty.
Dutytomi ti
gate:Tomakel esssever
e,t omakecalmer,l
essangr
y,
reduct
ion i
n punishment
/penalt
y,t
or educe i
n amountordegr
ee t
o
miti
gatethedamagecausedbyawr ongfulact
.
Esti
mat
ionofl
oss/
damagesar
isi
ngf
rom abr
eachofcont
ract

Thepartysufferi
ngf
rom t
hebr
eachofcont
ractshoul
dtake
reasonabl
estepstomit
igatet
heext
entofdamage,
ifhef
ail
sto
clai
m compensati
onforsuchl
oss.

Sect
ion73–Compensat
ionf
orl
oss/
damagecausedbybr
eachof
cont
ract
 Suchdamageswhichnat
ural
l
yar
osei
ntheusual
cour
seoft
hings,
fr
om suchbr
each.

 Suchdamageswhi
cht
hepar
ti
esknew,
whent
heymadet
he
 35

cont
ract

 Butsuchcompensati
onisnottobegi
venforanyr
emoteor
i
ndir
ectlossordamagesustai
nedbyr
easonofthebr
each

 Suchcompensat
ionf
ordamagear
isi
ngf
rom br
eachofaquasi
cont
ract
.

Secti
on74–Compensat
ionf
orbr
eachofcont
ractwher
epenal
ty
st
ipul
atedf
or.
Sect
ion75–Ri
ght
ful
l
yresci
ndscont
ract
,isent
it
ledt
ocompensat
ion.

SUI TFORDAMAGES
Itmeansmonet arycompensat ion, i
nt ermsofmoney , allowedf or
l
oss.
Pur pose-t ocompensat eaggr i
evedpar tyandnott opuni shpar ty
asf ault
Itistoputt hei njuredpar tyinthesameposi tion(Doctri
neofRest ituti
on)
.
InI ndia,rulesrelatingtodamagesar ebasedonEngl i
shj udgment
ofHadl eyv sBaxendal e.
Thef actsoft hecasewer e–H’ smi l
lwasst oppedduet ot he
breakdownoft heshaf t.Hedel i
v eredt heshaf tt
ocommoncar r
iert o
repairitandagr eedtopaycer tainsum ofmoneyf ordoingthi swor k.H
hasi nfor medBt hat,
del aywoul dr esultintol ossofpr of
it.Bdel ivered
theshaf tafterr easonabl etimeaf t
errepai r.Hf i
l
edasui tforl ossof
profit.Itwashel dthatBi snotliablef orlossofpr ofi
t.Thecour tl aid
downr ulet hatdamagescanber ecov er ed,ifthepar t
yhasbr eachof
cont r
act .
Infactt hemi ll
wasal readyst oppedduet ot hebr eakageoft heshaf t
,
withwhi cht hedef endanthasnot hingt odo.I twast hefaultoft he
plainti
ffnoti nf
or mingt her ealci
r cumst ance.

Itwasaccr
uedinthenatureandmechanicalprocess.Ifthei
mport
ance
ofarr
angi
ngnewonewast oldt
othedefendant,hemi ghthav
earr
anged
the
subst
it
utearr
angement
sf orqui
cktr
ansportat
ionoftheshaft.
KINDSOFDAMAGES
Secti
on73-Compensat
ionf
orl
ossordamagescausedbybr
eachof
contr
act
.
 36

Compensat ionf orf ail

ur etodi schar ger ight sandobl igati
ons, r
esembl i
ng
thosecr eatedbycont ract .
Il
lustrat ion: Acont r actst orepai rB’ shousei nacer t
ainmannerand
receiv espay menti nadv ance.Ar epairst hehouse, butnotaccor dingto
thecont ract.Bi sent i
tledt or ecov erfrom A, thecostofmaki ngt he
repairs, accor dingt othecont ract.
 Remot enessofdamage
1.Damagear i
singi nt heusual cour seoft hings
2.Mor el ossar i
singf rom t hespeci al ci
rcumst ances.
Sect i
on74-Compensat i
onf orbr eachofcont ractwher epenal ty
stipulat ed
f or.
Thef ollowi ngar edi f
ferentki ndofDamages:
1.Or dinar yDamages:
Thesear et hedamages, whi char epay ableforthelossar ising
nat urallyanddi r
ect l
y, asar esul tofbr eachofcont ract.Itisal so
knownasPr oxi mat edamageorNat ural damage.
2.Speci al Damages:
Thesear edamages,whi char epay ablef orlossar isingduet o
somespeci alci rcumst ances.I tcanber ecoveredonl yi fspeci al
circumst ances,whi chr esul tsinspeci alloss,incaseofbr eachof
cont ractandpar tyhav enot i
ceofsuchdamage.
Exampl e:Asendssampl eofhi spr oduct sforexhibit
iont oanagent
ofar ailwaycompanyf orcar ri
aget o“NewDel hi”,f
oranexhi bit
ion.
Theconsi gnmentnot est ated:“ MustbeatNew Del hi,Monday
Cer tain.” Duet onegl i
genceoft hecompany ,thegoodsr eached
onl yaf tert heexhi bitionwasov er.Hel d,t hecompanywasl i
able
fort hel osscausedbyl atear ri
v aloft hepr oducts,becauset he
company ’
sagentwasawar eoft hespeci alcir
cumst ances.
3.Exempl aryorPuni ti
veorVi ndictiveDamages:
Thesedamagesar eal lowednott ocompensat epar ty,butasa
meansofpuni shment ,todef aultingpar ty.Thecour tmayawar d
thesedamagesi nt hecaseof :
Breachofcont ractt omar ry–l ossbasedonment alagony
Wr ongf uldi shonourofcheque – smal leramount ,l argert he
damage.
4.Nomi
nal
Damages
 37

Wherethepart
ysuffersno l
oss,thecour
tmayallow nomi
nal
damagessi
mplytoestabl
i
shthat,t
hatpar
tyhaspr
ovedhiscase
andwon.Nominal
damageisv
erysmall
inamount.
5.Damagesf orinconvenience
Ifthepar tyhassuf feredphy sicalinconv eni
ence,di
scomfortand
ment alagony ,asar esultofbr eachofcont r
act,thepart
ycan
recoverthedamagesf orsuchi nconv enience.
Exampl e:Aphot ographeragreedt ot akephotographsatawedding
ceremony ,butfail
edt odoso.Thebr idebroughtanacti
onforthe
breach
ofcont ract. Held,shewasent itl
edt odamagesf orherinjur
ed
f
eel
i
ngs.
6.Liquidat edDamagesandPenal t
y
Par tymayspeci f
yt heamountatt het imeofent er
ingi ntot he
cont ract.Theamountsospeci fi
edmaybe( a)Liquidat edDamage
or( b)Penal ty .
Ifspeci fi
edsum r epresent,fai
randgenui nepr e-estimatedamages,
l
ikelyt or esultduet obreach, i
tiscal ledLiquidatedDamages.
Buti fspeci fiedsum i sdisproportionat e(Unequal )tothedamages,
i
tiscal edasPenal
l ty.
Asr egar dthepay mentofl i
quidat eddamagesandpenal t
y,court
cannoti ncrease the amountofdamages bey ond t he amount
speci fi
edi nt hecontract.
Exampl e:Agi v
esB,abondf orther epaymentofRs. 1,000/-with
i
nt erestat12per cent,attheendofsi xmont hs;wi thast ipulat
ion
that,incaseofdef aul t
,theinterestshal lbepay ableatt her ateof
75per cent ,
f rom t
hedat eofdef aul t.Thisisast ipulati
onbywayof
penal ty and B i s onl y ent i
tled t o recover f rom A,such
compensat ionast hecour tconsider s
reasonabl e.
For
fei
tur
eofsecur
it
ydeposit(
Penal
tyClause)
Anyclause i
n cont
ractenti
tl
ing t
he aggr
iev
ed par
tytof orf
eit
secur
it
y
deposi
tby way ofpenalty and cour
tmay awar dreasonabl
e
compensat
ion.
 38

Pay
mentofi
nterest
I
tispermissi
ble
I
fint
erestisi
nnatur
eofpenal
ty,
cour
tmaygr
antr
eli
ef.

fnor
I ateofi
nter
esti
sspeci
fi
edi
ncont
ract
,thepar
tyshal
l
be
l
iabl
etopayaspert
hel
aw i
nfor
ceorast
hecust
om or
usageof
tr
ade.
Costofsui
tordecree
Thecour thasalsodiscr
eti
ontoawardcostofsuitf
ordamagesin
addit
iontothedamagesf orbr
eachofcontr
act.
Sui
tforSpeci
ficPerf
ormance
Itmeans,demandi nganorderfr
om cour
tthatthepromiseagr
eed
incontractshal
lbecar ri
edout.Recourseofalter
nati
veremedy
inst
eadof
recover
ingdamages. I tiscontai
nedintheSpecificReli
efAct
,
1963.
Wheni sspeci f
icper formanceal l
owed?
Whenact ual damagesar isi
ngf rom br eachisnotmeasur able.
Wher e perf ormance ofcont ractr equires number s ofmi nute
det ai
lsandt hereforenotpossi bleforcour ttosuper vi
se:
Wher ethecont ractisofper sonal innat ur
e
Wher ethecont racti smadebycompanybey ondi tspower( Ul t
ra
vires)
Wher eonepar tytocont r
actismi nor
Wher ethecont ractisinequitablet oeitherparty.
Exampl e:A agr eest osel lB,anar t
istpaintingf orRs. 30,000/ -
.
Lat eron,her efusedt osel l
.Her eBcanf il
easui tagai nstAf or
speci fi
cper formanceoft hecont ract.
Suitf
ori njunction
Itmeansst ayor dergr antedbycour t.Thisor derprohibitsaper son
todoapar ti
cularact ,r est
rainingtheot herpar t
yf orm maki ngabr each
ofcont r
act .
Wher et herei sabr eachofcont ractbyonepar tyanor derof
i
njunctionmaybegr antedf orspeci f
icper formancebyt hecour t.
Exampl e:Film act ressagr eedt oactexcl usivel
yforW f oray earandf or
 39

nooneelse,dur
ingtheyear
,shecontr
actedtoactf
orZ.
Compensation-fi
xedbythecourt
.
Penal
ty-f
ixedbythepart
ies
Damages-compensationandotherl
osses.

b.
WhatisQuasiCont
ract
?Expl
aindi
ff
erent
kindsofQuasi
Contr
acts?
QUASICONTRACTS
Secti
on 68 – 72 ofI ndian cont
ract
s Act,1872,deals wi t
h certai
n
rel
ati
onsr esemblingthosecr eat
edbycont r
act.Itincorporatesthose
obli
gati
onswhi chareknownasquasicont ract
sunderEngl i
shLaw.The
basisoftheobl i
gati
onsist hatnooneshouldhaveunjustbenef i
tatthe
costoft heot her.Inanact ionforunj
ustenrichment,thef oll
owing
essenti
alshavetobepr oved:

1.Thedef
endanthasbeenenr
ichedbyt
her
ecei
ptofabenef
it

2.Theenr
ichmenti
satt
heexpenseoft
hepl
aint
if
f.

3.Ther
etent
ionoft
heenr
ichmenti
sunj
ust
.

The I
ndi
an Cont
ractActdeal
s wi
tht
he f
oll
owi
ng quasi
-cont
ract
ual
obl
i
gati
ons:

1.Clai
m fornecessar
ies suppl
i
ed t
o a per
son i
ncompet
entt
o
contr
act(
Sect
ion68)
:

Wher eoneper sonsuppliesnecessar i

essui
tedforthecondi t
ioninthe
l
ifeofaper son,whoi sincompet entt ocont
ract(Forexample,minoror
l
unatic)ortoany onewhom suchi ncompetentpersonislegal
l
yboundt o
support( Forexampl e,t oal unatic’
s wi
fe orchildren),t
he person
furni
shing such suppl i
es i s entit
led toar eimbursementf rom the
propert
yofsuchi ncompet entperson.
 40

Il
l
ustr
ati
on: A suppl
i
esB,alunat
ic,wi
thnecessari
essuitedtohi
s
condi
ti
oninl
i
fe.Ai
senti
tl
edt
oberei
mbursedf
rom B’sproper
ty.

2.Rei
mbur
sementofmoneypai
d,duebyanot
her(
Sect
ion69)
:

Rei
mbursementofapersonpay i
ngmoneyduebyanotheri
npaymentof
whi
chhei sint
erest
ed.Aper son,whoi si
nter
est
edinpaymentofthe
money,whi
chanotheri
sboundbyl aw,topayandwhother
efor
epaysit
,
i
senti
tl
edtobereimbur
sedbyt heother
.

Twoessent
ial
s:

i
. Onepersonisint
erest
edi
npay
mentoft
hemoneyandt
her
efor
ehe
pay
sit;
while,
i
i
. Anot
herper
soni
sboundbyl
awt
opayt
hesame,
buthef
ail
stopay
.

3.Obl
i
gat
ionofper
sonenj
oyi
ngbenef
itofnon-
grat
uit
ousAct

(Sect
ion 70)
:for appl
icat
ions of t
his sect
ion,t
he f
oll
owi
ng
condi
tionsar
etobesati
sfi
ed.

a.Apersonlawfull
ydosomet
hingf
oranot
herper
sonorshoul
d
del
i
versomethingtohi
m;

b.Thepersonmaki ngthepaymentordel
i
ver
ingthet
hingmustnot
dosogr atui
tously
,thatis,heshoul
dexpectpaymentforthe
same;and

c.Theot
herpersonshoul
denj
oyt
hebenef
itoft
hispay
mentor
del
i
ver
yofthethi
ng.

Whenal ltheabov
econdit
ionsar
esati
sfi
ed,thepersonr ecei
vi
ngt he
benef
itbecomesboundt
opaycompensat
iontothepersonconferr
ing.

 Noi nt
ent
ionst
odoactgr at
uit
ously
,whent hepersondoesnot
i
ntendtodoitgrat
uit
ousl
y,butexpectspaymentforthesameon
doi
ngsuchact,hecanaskforcompensationunderSect
ion70.

 Enjoymentofbenefi
tbythedefendantisnecessar
y:t
hevol
untar
y
acceptanceofthebenefi
tofthewor kdoneorthethi
ngdel
iver
ed
i
st hefoundat
ionofthecl
aim undersect
ion70.
 41

 Unjustbenef
ittothedefendantnecessar
y:Sec70isfoundont he
pri
ncipl
ethatoneshouldnotgainunjustenri
chmentatthecostof
theother.Ifther
ei snounjustgainobtainedi
nanyt r
ansacti
on,
Sec70hasnoappl i
cat
ion.

Appl
i
cat
ionofSec70agai
nstgov
ernment
:

Sec70preventsunj
ustenri
chmentandi tappli
esasmucht oindivi
duals
astocorporati
onsandgov er
nment.I ft heservi
cesrenderedorgoods
suppl
iedtothegovernmentareunderapur port
edcont r
act,whichdoes
notmateri
ali
zebecauseofnon- f
ulf
il
lmentoft hef or
mal i
ti
esprescribed
i
nAr t
.299oftheConstit
uti
on,thegovernmentcanst il
lbemadel i
ableto
compensateforthesameunderSec70oft heCont r
actAct,ifithas
enj
oyedthebenefi
tofwhathasbeendoneundert hepurport
edcont r
act.

Sec70cannotbei
nvokedagai
nstaMi
nor
:

Ami nor ’
sagreementbeingv oidabi ni
ti
o,hecannotbemadel i
abl
eunder
Sec64and65oft heContractAct .Butifnecessari
esar esuppl
i
edt oa
mi nor ,hi
sest at
ecanbemadel iabl
eundert heSec68.I thasbeenheld
thatnoact ioncanbebr oughtagai nstami nortorecovercompensati
on
from hi m underSec70. Sec70cannotbei nvokedagainstami nor.
Firstl
y ,theSect i
oncoversev er
y“ Per
son”whet herhei scompetentto
cont ractornot .Secondly,thereisnothinginlawwhi chdebarsaminor
from enj oyingthebenef
itoft heactdonebyanot herperson.

4.Responsi
bil
i
tyoft
hef
inderofgoods:

Sec71cont emplat
esstil
lanot
herquasicont
ractualsit
uati
on,i
.e.
,when
apersonisaf i
nderofgoodsbelongingt
oanot herandtakesthegoods
tohiscustodyandi sintheposi
tionofabaileewi t
hal lr
esponsi
bil
i
ty.
Ever
ybail
eehasaf ol
lowi
ngduti
es:-

 Dut
yorr
easonabl
ecar
e(Sec151-
152)

 Dut
ynott
omakeunaut
hor
izeduse(
Sec154)

 Dut
ynott
omi
x(Sec155)

 Dut
ytor
etur
n(Sec156)

 Dut
ynott
osetj
ust
ert
li(
ri
ghtoft
hir
dper
son)Sec165-
167
 42

 Dut
ytor
etur
nincr
ease(
Sec163)

5.Li
abil
i
tyofaper
songet
ti
ngbenef
itundermi
stakeorcoer
cion(
Sec
72)

 Unj
ustbenefi
tundermi st
ake:Secti
on72cov ersasi tuat
ion
where moneyhas been paid,orany thi
ng deli
vered byone
per
sontoanotherei
therbymistakeorundercoerci
on.

 Moneypaidorany t
hingdel i
ver
edundermi st
ake:Accordingt o
Art.
265oft heConstitut
ion,notaxshallbelevi
edorcol lected
exceptbytheauthori
tyofl aw.Lawher emeansonl yval
idl aw.
Sec72andt hesameoughtt ober ef
undedbythegov ernment
becausethegov er
nmentcannotbeal lowedtounjust
lyenr ich
i
tselfbyr
etaini
ngthetaxsor ecei
ved.

 Moneynotr ecov erabl

ewher ethereisnoenrichmentoft he
defendant
.Ifther ecei
verofthemoneyhasnolongerthesame
wit
hhi m,andhasf ur
therpaiditunderasi
milarmistake,he
cannotberequir
edt orepaythesame.

 Unjustbenefi
tundercoer
cion:Sec72permitsthemoneypaid
orany t
hingdeli
ver
ed,
eit
herbymi st
akeorundercoer
cion,
tobe
recoveredback.

 Compul
sionofl
awi
snotcoer
cion.

Q.
2
a.Quant
um Mer
uit
Whent hei
njur
edpart
yhasper f
ormedapar tofi
tsobl
igat
ionundert
he
contr
actbef
orethebreachofcontr
acthasoccurr
ed,heisent
it
ledto
recov
ertheval
ueofwhathehasdone, underthi
sremedy.

Whereonepar t
yhasabsol utel
yr ef
usedtoper f
orm,orhasr ender
ed
himsel
fincapableofperf
orminghispartofthecontr
act
,heputsitint
he
poweroft heotherpart
yeithertosueforthebreachofitortoresci
nd
thecontractandsuet hecontractandsueonquant um merui
tf ort
he
 43

wor
kact
ual
l
ydone.

Quant
um Mer
uit=“
asmuchasear
ned”
,asmuchasmer
it
ed/
deser
ved.

Whenaper sonhasdonesomewor kunderacont r

act
,andt heother
part
yrepudi
atest
hecontr
act
,orsomeev enthappenswhichmakest he
fur
therper
for
manceofthecont
racti
mpossi bl
e,t
henthepart
ywhohas
perf
ormedwor kcancl
aimremunerati
onf ortheworkhehasal r
eady
done.

Il
l
ustrat
ion:Aagr eestodeli
verB,500bagsofwheatandwhenAhas
alr
eadydeliv
er ed100bags,
Br ef
usedt
oacceptanyfur
thersuppl
y,andA
canrecoverfrom Btheval
ueofwheatwhichhehasalr
eadydeli
ver
ed.

Secti
on65oftheactlay
sdownthatwhenanagreementi
sdi
scover
edto
bevoidorbecomesv oi
danypersonwhohasreceiv
edanyadvant
ages
undersuchagr
eementisboundtorest
orei
t.Ortomakecompensati
on
fori
t,t
othepersonf
rom her
ecei
vedit.

I
ll
ust
rati
on:A paysB Rs.1000/
-inconsiderat
ionwit
hB’spromiseto
marr
yC, A‘
sDaughter.Cisdeadatti
meoft hepromi
se.Theagr
eement
i
svoid,
butBmustr epayAsum ofRs.
1000/-

Secti
on70:pr ov
idesthatwhereaper sonl awf
ull
ydoesany t
hingfor
anotherperson,ordeliver
sany t
hing to him notintendi
ng to do so
grat
uitousl
y,andsuchotherper
sonenjoy sthebenefi
t.Thereoft
helatt
er
i
sboundt omakecompensat i
ontothefor merinrespectofortorest
ore
thethi
ngsodoneordel iv
ered,i
nthefol
lowingcases:

a.Whent her
ei sanexpr
essorimpli
edcont
ractt
orenderser
vices
thatbuttherewasno agreementastoremuner
ati
on,insuch
cir
cumstances

r
easonabl
eremuner
ati
oni
spay
abl
ei.
e.Quant
um Mer
uit
.

b.Whenthecompl
eti
onoft
hecont
racthasbeenpr
event
edbyt
he
actoft
he

ot
herpar
tyt
ocont
ract
.
 44

c.Whenacont r
actisdi v
isi
bleandthepartyindefaul
thasenjoyed
thebenefi
toft hepartperfor
mance,thepartywhoperformedthe
contr
actmaysueon Quant um Mer i
ut.I fthecontractisnot
div
isi
ble,the party who perf
ormed the contr
actcannotclai
m
remunerat
ionont hegroundofQuantum Meruit
.

a.I
ncaseofv
oidagr
eementorcont
ractt
hatbecomesv
oid
Anypersonwhohasr eceiv
edanyadv ant
ageundersuch
agr
eementorcontracti
sboundt orest
oreortomakecompensat
ionf
or
i
t,t
otheper
sonf r
om orwhor eceiv
edit.
Ex:-1)Agi
vesBRs.
10000tomar
ryC(A’sdaught
er)
.Cdiedatt
he
ti
meof /befor
etheti
meofper
for
manceofcontr
act–BmustrepayA,
Rs.10000/-
.
Ex.2)Aagreedtodel
iv
erB250qui nceofr
icebef
orethe1stofMay.
Adeli
vers130quintal
sonly,bef
orethatdayandnoneafter.Br et
ains
130qui
ntal
safterthef
ir
stofMay .HeisboundtopayAforthem.
Ex.
3)B engagesA,asi ngertosing,t
wonight
sinev er
yweek,
duringthenextt womonthsandagr eestopayherRs.100foreach
th
night’
sperf
ormance,ont
he6 night.Awi l
l
ful
l
ywasabsent.Bmustpay
forthefi
venight
sonwhichshehadsung.
b.I
ncaseofActpr
event
ingt
hecompl
eti
ngofcont
ract
:-
Ifapart
ydoesnotcompletethecontr
actorprev
ent
st heot
herpart
yto
complet
ethecont
ract
,theaggri
evedpart
ycansueorquant
um merui
t.
Ex:-Owner -Pwr i
teabookt obepubli
shedasseri
esinhi
smagazine.
Afterafew seri
eswer epubl
i
shedthepubli
cat
ionofthemagazi
newas
stopped.ItwasheldthatPcouldcl
aim pay
mentonquant
um merui
tfor
thepartal
readypubli
shed.
c.I
ncaseofdi
vi
sibl
econt
ract
:-
1. I
fthecont
racti
sdi
vi
sibl
eand
2. Ifthe par
ty notatdef
aul
thas enj
oyed benef
itoft
he poi
nt
per
for
mance
3. Thecont
racti
spar
tl
yper
for
med.
I
ftheabovecondit
ionissatisf
ied,t
hepar t
yatf aul
tmaycl ai
m the
pay
mentonquantum merui
tforthepartofcont
ractperf
ormedbyhim.
Hecanr
ecoversuchpropor
ti
onoft hecontr
actpri
ce,astheworkdone
 45

byhi
m/bear
stot
hewor
kundert
hecont
ract
.
d.I
ncaseofi
ndi
vi
sibl
econt
ractper
for
medcompl
etel
ybutbadl
y.
Cont
racti
sindi
vi
sibl
e
Lumpsum consi
der
ati
on
Compl
etel
yper
for
med
Per
for
medbadl
y
Thatpart
yatfaul
tmayr
ecov
erthecont
ractpr
ice(
Lumpsum pr
ice)l
ess
thededuct
ionmadef
ort
heworkdonebadl
y.
Ex:-Xagreedt odecor
ateY’sfl
atf
oralumpsum ofRs.
20,000/-
.Xdi d
thecompleteworkbutYcomplai
nedoff
ault
ywork.Ystoppedthewor k.
I
tcostsYanot herRs.
3000/
-toremedyt
hedefect
.Xcouldr ecoveronly
Rs.17,
000/-f
rom Y.
e.I
ncaseofNon-
grat
uit
ousAct–Thr
eecondi
ti
ons-
i
. Thet
hingmusthav
ebeendoneordel
i
ver
edl
awf
ull
y
i
i
. Theper sonwhohasdoneordel
i
ver
edt
het
hingsmustnothav
e
i
ntended
t
odosograt
uit
ousl
y;and
i
ii
. Thepersonf
rom whom t
heacti
sdone,musthav
eenj
oyedt
he
benef
itof
act.
Ex:A,atr
adesmanl
eav
esgoodsatB’
sshop,bymi
stake.Bt
reat
sthe
goodsahi
sown.Heisboundt
opayAfort
hem.

b.Ti
mef
orper
for
mance
Ti
me,
placeandmannerofper
for
mance(
Sect
ions46-50)

Thepart
iesaref
reet
odeci
deast
owhenandwher
etheper
for
manceof
thecont
racti
stobemade.

1.Not
imei
sspeci
fi
edf
orper
for
mance(
Sec46)

Ti
meofperfor
manceisnotspeci
fi
ed+promisoragr
eedt
operf
orm
wi
thout
,ademandfr
om thepromiset
heperf
ormancemustbemade
 46

withi
nar easonablet
ime.Reasonabletime–ineachpar ti
cul
arcase–a
questionoffact.Sec36(2)thesaleofgoodsactal
socont ai
nsasimi
lar
provi
sion:-whenthesel
lerisboundtodeli
vert
hegoods, butnoti
mefor
sendingthem isfi
xed,t
hesel l
erisboundtosendthem withi
na
reasonableti
me.

2.Ti
mespeci
fi
edbuthournotment
ioned(
Sec47)

Timeofperfor
mancespecifi
ed+promisoragreedtoperf
orm without
appl
icat
ionbythepromise.Per
formermustperfor
m ont hedayfixed
duri
ngtheusualbusi
nesshoursandatplaceatwhichthepromiseought
tobeperfor
med.

Ti
meandplaceforper
for
manceofpromise,
wheret
imeisspeci
fi
ed,and
noappl
i
cati
ontobemade.(dur
ingbusi
nesshour
sonsuchday/usual
cl
osi
ngti
me)

Apromisetodel
iv
ergoodsatB’swarehouseon1stJan.onthatday,A
bri
ngsthegoodstoB’
swarehouse,
butaftert
heusual hourf
orclosi
ngit
,
andtheyar
enotrecei
ved.Ahasnotperformedhi
spr omise.

3.Wher
eti
mei
sfi
xedandappl
i
cat
iont
obemade(
Sec48)

 Pr
operpl
aceandwi
thi
ntheusual
hourofbusi
ness.

 Pr
omi
seet
oappl
yforper
for
mance.

Whenthepromiseistoapplyf
orper
formance,
hemustdosoatpr
oper
t
imeandplace.(Usualhour
sofbusi
ness)

4.Perf
ormanceofpr
omi
sewherenopl
acei
sspecif
iedandno
appl
icat
ioni
stobemadebyt
hepromi
se(Sec49)

I
ti sthedutyofthepromi
sortoappl
ytothepr
omisetoappointa
reasonableplacefort
heper
formanceandper
for
mi tatsuchappoi
nted
place.

Pl
aceofper
for
manceofpr
omise,whereappli
cat
iont
obemadeandno
pl
acef
ixedf
orper
for
mance(Reasonabl
eplace)

Aundert
akestodel
i
verathousandmoundsofj utetoBonafixedday
.A
mustapplytoBt
oappointareasonableplacef
orthepur
poseof
r
ecei
vingit,
andmustdel
iveri
ttohim atsuchplace.
 47

5.Perf
ormanceinmanneroratt
het
imepr
escr
ibedorsanct
ionedby
promise.(
Sec50)

I
nsuchpr
escr
ibemannerand

 Pr
escr
ibedt
ime

Theperf
ormanceofanypromi
semaybei nanymanner
,oratanyt
ime
whicht
hepromisepr
escri
besorsanct
ions.

Ex.AdesiresBwhooweshi m Rs.10,
000/-tosendhim apromissor
y
noteforRs.10,
000/-bypost.ThedebtisdischargedassoonasBput s
i
ntothepostal et
tercont
ainingthepromissorynotedul
yaddressedtoA.

BowesA, Rs.
2000/-Adesi
resBt opayt heamountt
oA’
saccountwit
hC,
abanker
.Bwhoal sobankswi t
hC, orderst
heamountt
obetransf
err
ed
f
rom hi
saccounttoAscredit
,andthisisdonebyC.

Uni
t5
Q.
1
a.Expl
aint
hepr
ovi
sionsr
elat
ingt
ocancel
l
ati
onof
i
nstrument
s.
TheSpeci
ficReliefActprov
idesforspecif
icrel
iefs.Specif
icReli
ef
meansrel
iefofacer tai
nspecies,i
.e.anexactorparti
cul
ar,anamed,
fi
xedordeter
mi nedreli
ef.I
tisunder st
oodaspr ovi
dingrel
iefofa
speci
fi
ckindthant hegeneralr
eli
efofdamagesorcompensat ion.

 Recov
eryofpossessi
onofpr
oper
ty

 Speci
fi
cper
for
manceofcont
ract
s

 Rect
if
icat
ionofi
nst
rument
s

 Resci
ssi
onofcont
ract
s

 Cancel
l
ati
onofi
nst
rument
s
 48

 Decl
arat
orydecr
ees

 Pr
event
iver
eli
efv
izi
njunct
ions

Sec31-
33deal
swi
tht
hecancel
l
ati
onofi
nst
rument
s.

Sec31-Cancel
l
ati
onmay
beor
der
ed

 Anyper
sonagai
nstwhom awr
it
teni
nst
rumenti
svoi
dorv
oidabl
e.

 Whohasr easonabl
eappr
ehensi
onthatsuchi
nst
rumenti
flef
t
out
standi
ngmaycausehim seri
ousinj
ury.

 Hemaysuetohav
ethei
nst
rumentadj
udgedbyt
hecour
tasv
oid
orv
oidabl
e.

 Thecourtinsuchasui
tmay ,
ini
tsdi
scret
ionadj
udgedthe
i
nstrumentasvoidorv
oidabl
eandorderi
ttobedeli
ver
edupand
cancel
led.

I
ll
ust
rat
ions:

1.A,theownerofaship,
byfr
audul
entl
yrepr
esenti
nghert
obesea-
worthyinducesB,
anunder
wri
ter
,toi
nsureher;
Bmayobt ai
nthe
cancell
ati
onofthepol
i
cy.

2.Aconv ey slandBwhobequeat hsitt

oCanddies.ThereuponD
getspossessi onofthelandandproducesaf
orgedinstr
ument
stat
ingt hattheconveyancewasmadet oBintr
ustforhim.Cmay
obtainthecancellat
ionofthefor
gedinstr
ument
.

Cancel
l
ati
onofsaledeedproperduet
ofraudul
ent
lyexecut
edby
def
endantwi
thoutconsentandknowl
edgeofowner.

Stat
ementcont
ainedi
nwi
l
ladmi
ssi
blei
nsui
tforcancel
l
ati
onofsal
e
deed.

Sui
tforcancel
l
ati
onofsal
e-deed,theci
vi
lcourt
’sj
uri
sdi
cti
ondonotbar,
byi
nvokedSec331ofU.P.
Zami ndari
abol
it
ionandlandr
eformsact1950.

Mai
ntai
nabi
l
ityofSui
tforDecl
arat
ionofSal
eDeed,
asnul
landv
oid.

Di
smissalofsui
tfordecl
ari
ngsal
edeedasv
oidongr
oundoff
raudand
mi
srepresent
ati
on.
 49

Sui
tfi
ledaft
erlapseof13year
sbarr
edbylimit
ati
on(SaleDeedasnul
l
andvoidi
swithin3yearsf
rom t
hedateofaccr
ualofcauseofact
ion)

Powerofat
tor
ney-sui
tfordecl
arat
ion,
inj
uncti
onandcancel
l
ati
onof
Sal
eDeed,sui
tpr
oceedingsnotbonafi
deproceedi
ngs.

Whati
nst
rument
smay
becancel
l
edpar
ti
all
y(Sec32)

Ther i
ght sandobli
gati
onscont ai
nedwher einareseparabl
e.Insucha
casethecour tmay,init
sdiscreti
onal l
owapar toftheinstr
umentt obe
cancell
edandal lowtheremainingt ostand.Wher etheri
ghtsand
obli
gationsunderaninstrumentar enotseparable,t
hegoodpar tcannot
besepar ablefr
om thebadpart; t
herecannotbepar ti
alcancel
lat
ionof
theinstrument.Thewholeofthei nstr
umenthast obecancell
edbyt he
court.

I
ll
ust
rat
ions:

Adr awsabi l
lonB,whoendorsesitt
oCbywhom itappear
stobe
endor sedtoD, whoendor
sesittoE.Csendor
sementisfor
ged.Cis
enti
tledt ohavesuchendorsementcancel
l
ed,
leav
ingthebi
llt
ostandi
n
otherr espect
s.

Powerofthecour
ttorest
orebenef
itoral
l
owcompensat
ionon
cancel
l
ati
onofaninst
rument(Sec33)

Wher einst
rumentiscancel
ledorissuccessf
ull
yresi
stedasbei
ngvoid
orvoidableSec33(1)thecourtmayrequir
etheplai
nti
ff,
thepar
tywhom
thereli
efisgrant
ed-

1.Tor estor
e,sof
arasmaybeanybenef
itwhi
chhemayhav
e
receivedfr
om t
heotherpar
ty,
and

2.Tomakeanycompensat
iont
ohi
m whi
chj
ust
icemayr
equi
re.

Sec33(2):
Requir
esthedef
endanttorest
orebenef
itrecei
vedbyhi
m and
topaycompensati
on,whenheresi
ststhesui
tofenforci
ngan
i
nstrumentagai
nsthi
m.

Sec39: anyper
sonagainstwhom awr itt
eninstr
umentisvoi
dor
voi
dable,whohasreasonableapprehensionthatsuchi
nst
rument
,ifl
eft
out
standing,maycausehim ser
iousinjury,
maysuet ohav
eitadj
udged
 50

void/
voi
dabl
eandthecour
tmay ,
init
sdiscr
eti
onsoadj
udgedi
tand
orderi
ttobedel
i
veredupandcancel
led.

Sec41:onadjudgi
ngthecancel
l
ationofaninstr
ument,t
hecour
tmay
requi
ret
hepartytowhom suchrel
iefi
sgrantedtomakeany
compensat
iontotheotherwhi
chjusti
cemayr equi
re.

Pr
esentposi
ti
on:
-

1.Ifami norgoest ot hecourtasplai

nti
ffforthecancel
lati
onofan
i
nstrument ,thecour tmay ,
onadjudgingthecancell
ati
onr equi
re
suchami nor,torestorethebenefi
tandt omakesuch
compensat iontot heotherpartyasjusti
cemayr equi
re.Theobject
ofthepr esentpr ov i
sionistorest
orethepar t
iest
otheirorigi
nal
posit
ion, asf araspossi bl
e.

2.Whent hemi noristhedefendantinacaseandher esi

ststhe
enforcementoft hesuitongroundthatheisincompet entto
contract,thecour tmayaskhimt orestoresuchbenefittotheother
party
, t
ot heext enthi
sestatehasbeenbenef it
edthereby.Through
thi
spr ovisiontheparti
esaret r
iedtobeputtot hepre-
cont r
act
posit
ion.Mor eover,
compensat i
onintermsofmoneyi salso
permitted.I notherwords,i
tmeanst hattheruleofEnglishlawlai
d
i
nLesl iev .Sheil
lisnotappl
icablei
nIndia.

Sec33appliestobothvoidaswel
lasvoi
dableinstr
umentofwhich
cancel
l
ationissought
.Sec33ofthespeci
fi
creliefAct1963hastobe
readwit
hSec65oft heIndi
anConst
it
uti
onAct,1872;

Sec65:whenanagr eementisdiscover
edtobev oidorwhena
contr
actbecomesv oi
d,anypersonwhohasr eceiv
edanyadv ant
age
undersuchagreementorcontracti
sboundtor est
oreit
,ortmake
compensati
onf ori
t,t
othepersonfrom whom hereceiv
edit.

b.Wri
teanoteonspeci
fi
cper
formanceof
cont
ractpr
ovi
dedundert
heact.
Sec 10-13 expl
ains t
he prov
isi
ons aboutcont
racts whi
ch can be
speci
fi
call
yenfor
ced.Speci
fi
cperfor
manceisanequit
abl
erel
ief
.Sec10
 51

def
inescasesi
nwhi
chspeci
fi
cper
for
manceofcont
racti
senf
orceabl
e.

Rul
es:

1.No st andard ofascertaini

ng damages:When t here exist
s no
standar dforascert
aini
ngt heactualdamagecausedbyt henon-
performanceofheactagr eedtobedone.Acont racttodel i
ver
specificgoodswi l
lbeenforcedbywayofper for
mancei ftheyar e
“arti
clesofunusualbeaut y,r
ari
tyanddi st
incti
on”orofspeci al
value t ot he part
y suing by r eason of personalor f amily
associ at
ionortheli
ke.

Il
lust
rat
ion:Aagreest obuyBagr eestosellapictur
ebyadeadpainter
and2chi navases.AmaycompelBspeci f
ical
l
ytoper f
ormthi
scont
ract
forther
ei snost andardforascertai
ningtheactualdamagewhichbe
causedbyitsnon-perf
ormance.

Ot
herexampl
esofcont
ract
swhi
chcanbespeci
fi
cal
l
yenf
orced:

a.Agr
eementt
oret
ir
e.

b.Cont
ractt
oconv
eyacont
ingenti
nter
est
.

c.Cont
ractf
ort
hesal
eandpur
chaseofl
i
feameni
ti
es.

d.Acont
ractf
ort
hesal
eofpat
ent
.

e.An agreementf
orseparat
ion between husband and wi
fe not
cont
aini
nganypr
ovi
sion,
whichi
sv oid.

2.Pecuni
arycompensati
onnotadequaterel
i
ef:Whencompensat
ion
i
sanadequat ereli
eftot heplai
nti
ff
,adecreeforthespecifi
c
perf
ormanceoft
hecont r
actshoul
dnotbemade.

Il
l
ust rati
on:A contr
actsto sel
land B contractsto buyacer tai
n
numberofr ail
waysharesofapar ti
cul
ardescr i
pti
on. Arefusesto
compl et
ethesale. B maycompelA speci fi
cal
lytoper f
orm thi
s
agreement ,forthesharesarel i
mit
ed in numberand notal ways
availableinthemar ket
,andt hei
rpossessionscar r
ieswithitthe
statusofashar ehol
der,whi
chcannotot
herwisebepr ocur
ed.
 52

Otherexampl
esofcont
ract
soft
heseki
nds,
whi
chcanbespeci
fi
cal
l
y
enfor
cedare:
-

1.Shar
esofcompany
;

2.Shar
esofpr
oper
ty;

3.Chat
tel
s;

4.Bui
l
dingcont
ractet
c..

3.Whenpecuni ar
ycompensationisnotrecover
able:Theinsolvency
ofadefendantisgeneral
l
yagr oundforgranti
ngspeci f
icrel
iefto
theplai
nti
ffundert hi
shead,wher ethereisa pr obabil
itythat
pecuni
arycompensat i
on,ifawarded,cannotbe r ecover
ed and
speci
fi
cperformancecanbegranted.

*ANYCONTRACT:Theset wowor dsi nSecti

on10oft hi
sActmeant hat,
anycont ractwhichcanbeenf orceablebyt helaw. Ani nval
id,void,
i
rregular
,unlawfulcont
ractcannotcomeundert hi
sSect i
on.Secti
on2(h)
oft heCont ractActdef i
nes“ anagr eementenf orceablebylaw isa
contract
”.Pat entri
ght
s,copy r
ights,choicesi
naction,chatt
elofspecial
value,et
c.canbespecificall
yenforced.

*DI
SCRETI ON OF THE CONTRACT:Thespeci f
icperf
ormanceoft he
contr
actdependsupont hediscreti
onoft hecourt
.Section10cl earl
y
mentionsthewords“…..anycont r
actmay ,int
hediscr
eti
onofthecour t
be enf or
ced.” Ther efore, “The juri
sdict
ion to decree specifi
c
perf
ormanceofacont ractisdiscreti
onar
y .Thisdi
scr
eti
onoft hecourt
i
snotar bi
trar
ybutsoundandr easonable”
.

*MOVABLEPROPERTY:Accor di
ngtoclause(
ii
)ofexpl
anati
onappended
toSecti
on10,Specif
icperfor
manceofacont ractr
elat
ingtomov abl
e
proper
tycanbesoughtbef
orethecour
t.

*
PARTNERSHI P:Iti
st hegeneralpri
nciplethatpartner
shipfi
rmsar e
f
ormed“bywi l
lofpart
ies”
.TheCour t
sgener all
ydonoti nt
erf
ereinthe
f
ormati
onofpar t
ner
shipfi
rms.Howev erincert
aincases,vi
z,acontr
act
f
orthepurchaseofashareinpart
ner
shipbusinessoranopt i
ontoenter
i
ntopar
tnershi
pmayspecifi
cal
lybeenforcedbycourts.
 53

*BUILDI
NG CONTRACT:Ther eisnodoubtt hat
,asageneralrule,t
he
courtwil
lnotenfor
cespeci
fi
cperf
ormanceofabuil
dingcont
ract
,butan
excepti
onfrom t
herul
ehasbeenrecogni
zed.

*
LEASE OF I
MMOVABLE PROPERTY:A cont r
actf
ort
he l
ease of
i
mmovabl
eproper
tyi
sspeci
fi
cal
l
yenf
orceabl
e.

*SALEOFLEASEHOLD:Asal
eofl
easehol
dpr
oper
tycanbespeci
fi
cal
l
y
enfor
ceabl
e.

*SALEOFI MMOVABLEPROPERTY:Explanati
ont oSect
ion10clar
if
ies
thatanagreementf
ort
hesal
eofimmov ablepropert
ycanbespeci
fi
call
y
enforceabl
e.

CONTRACTS PERTAI NI
NG TO TRUSTS:Sect ion11pr ovidesthatthe
contr
act
s connected wit
ht rust
s may be or dered fort he speci
fi
c
perf
ormance. Section 11 explains t
he cases,i n whi ch speci
fi
c
perf
ormanceofcontr
actsconnectedwit
htrust
sar eenforceabl
e.

a.Cont
ract
sconnect
edwi
tht
rust
s:Whent
hecont
racti
sfort
he
per
for
manceofat
rust
,thecour
tmayal
l
owspeci
fi
cper
for
mance.

b.Sect
ion11(
2)pr
ovi
dest
hatacont
ractmadebyat
rust
eei
nexcess
ofhi
s
power
sori
nbr
eachoft
rust
,cannotbespeci
fi
cal
l
yenf
orced.

c.TheI ndianTr ustsAct,

1882explai
nst heprov i
sionsaboutthet r
ust.
At r
usti sanobl i
gati
onannexedtot heowner shipofpropertyand
ari
singoutofaconf i
dencereposedinandaccept edbytheowner ,
ordecl aredandaccept edbyhi mf orthebenef i
tofanother,orof
anotherandowner .Thepersonwhodecl ar est heconfi
denceand
writ
est hetrustdeedi scal
led“Authoroft heTr ust
”.Theper son
whoaccept st heconfi
denceiscal
ledthe“Trust ee”.Thepersonf or
whose benef itthe confidence is accept ed is call
ed t he
“Beneficiar
y”.

Tr
usti
ncl
udesendowment
sforr
eli
giousandchar
it
abl
epur
poses.

d.When the aut

horofthe t
rustconfer
s huge and di
scr
eti
onar
y
power
st othetrust
eei
nthetr
ustdeed,thecour
tcannoti
nter
fer
e
 54

wi
tht
hedi
scr
eti
onar
ypoweroft
het
rust
ee.

Secti
on13 expl ai
nsthePROVI SI
ONSANDCLARIFIESTHERI GHTSof
the person who pur
chases f
rom a sel
l
er,who has no t
it
le orhas
i
mper fectt
it
le.

Secti
on12oftheSpeci
fi
cReli
efActexpl
ainsabout“
Speci
fi
c
perf
ormanceofpar
tofcont
ract”
.

Secti
on12( 1)oft
heSpecif
icReli
efAct
,whichprovi
des,“Thecourtshal
l
notdir
ectthespeci
fi
cperf
ormanceofapar tofcontr
act,excepti
ncases
comingunderoneorotherofthethr
eeprecedi
ngsections.The
except
ionsareembodiedi
nsections12(
2),(3)
,(4)
.

Essent
ial
ingr
edi
ent
sofSect
ion12(
2):

a.Thepartwhi
chmustbel
eftunper
for
medbear
sonl
yasmal
l
propor
ti
onof
t
hewhol
eval
ue.

b.Thepar
twhichmustbel
eftunper
for
medadmi
tsofcompensat
ion
i
nmoney .
Thepartunperf
ormedisl
arge,butcompensati
oncanbeesti
matedor
doesnotadmitcompensati
on:Secti
on12(3)sayst
hatwhereapartyt
oa
cont
racti
sunabletoperf
ormthewhol eofhi
spartofi
t,andapartwhi
ch
mustbeleftunper
for
medeither:-
a. For
msaconsi
der
abl
epar
toft
hewhol
e,t
hroughadmi
tt
ingof
compensat
ioni
nmoney
;or
b. Doesnotadmi
tcompensat
ioni
nmoney
.
Pri
ncipl
eofSect
ion12(3)
:Specif
icperf
ormanceofacontr
actwill
notbe
enfor
ceabl
eagai
nstthepurchase,wher
eamat er
ial
orsubstant
ialpar
tof
thesubj
ectmatt
eriswanti
ng.
Thi
ssect
ioni
senactedf
ort
hebenef
itoft
hepur
chaserandcannot
oper
atet
ohisdet
ri
ment.
Pri
ncipl
eofSecti
on12(4):Whereacontractconsi
stsofsev eralpar
ts,
whicharesepar
atefrom andi
ndependentofoneanot herandsomeof
whichcannotoroughtnottobeperf
ormed, suchpartorparts,ascan
andoughttobeperformedmayalongbespeci fi
cal
lyenforced.
 55

TheIndianContr
actAct,
1872,speci
fi
cal
l
ymenti
onscertai
ncontract
s
arenotenfor
ceablebef
orethelaw.Someoft
hedefencesavai
lable
accordi
ngtolaw:-
a. Mat
eri
alal
ter
ati
onsi
nagr
eement
b. For
ger
y,f
raud,
etc.
.
c. Li
mit
ati
ons
d. Ul
tr
avi
rescont
ract
s
e. Sui
tfi
l
edbyt
hepl
aint
if
fbef
orei
tsmat
uri
ty
f
. Doct
ri
neofFr
ust
rat
ion
g. Unl
awf
ulagr
eement
s
h. Agr
eement
sinducedbymi
stake
i
. Voi
dabl
enat
ureofcont
ract
j
. Absenceofpr
ivi
tyofcont
ract
k. Cont
ract
ual
incapaci
tyv
iz,
minor
s,l
unat
ics,
etc.
.
l
. Absenceofconsi
der
ati
oni
ndi
schar
geofcont
ract
m. I
nadequacyofconsi
der
ati
ons,
etc.
.

Q.
2
a.I
njunct
ions
I ON -
NJUNCTI Acommand,
abehest
,ar
est
rai
ningwr
it
.

Sect
ions36-44ofTheSpeci
fi
cRel
iefAct
,1963–deal
swi
th
PREVENTIVERELIEFORINJUNCTI
ON

APrevent
iveRel
i
ef(I
njunct
ion)i
sanor
derorcommandofthecour
t
prev
enti
ngapartyf
rom doi
ngsomethi
ng,
whichhei
sunderalegal
dut
y
nottodo.

Ani njuncti
onisajudi
cialprocess,
bywhichonewhohasi nvadedori
s
threateningtoinv
adether i
ghts,l
egal
orequit
abl
e,ofanother,i
s
restrainedfr
om conti
nuingorcommencingsuchwr ongf
ul act
s.
 56

Aninjuncti
onisanorderfr
amedaccordingtothecircumst
ancesofthe
casecommandi nganact,
whichthecourtr
egardsasessenti
alt
ojusti
ce
orrestrai
ninganact,
whichitest
eemscontrar
yt oequit
yandgood
conscience.

 Prevent
iverel
iefhowgranted:Sect
ion36laysdownthatpr
event
ive
rel
iefi
sgrantedatthediscret
ionofthecour
tbyinj
uncti
on,
temporaryorperpet
ual
.

 Obj
ect
:Theobj
ectt
ogr
antt
hei
njunct
ionar
e:

1.Br
eachofObl
i
gat
iont
obepr
event
ed;

2.Tor
est
rai
njudi
ci
alpr
oceedi
ngs

3.Tor
est
rai
nbr
eachofcont
ract
s

4.Topr
eventt
ort
uousact
s.

Inj
uncti
onsar
egrant
edt
opr ev
entmishappeningsandinj
urytothe
aggri
evedpar
ti
es.Ther
eli
efgrant
edbyinjuncti
onsareprevent
ivenat
ure.

 Essent
ial
ingr
edi
ent
sofi
njunct
ions:

1.I
tisaj
udi
cial
process

2.Theobj
ectat
tai
nedt
her
ebyi
stor
est
rai
ntorpr
event
ion

3.Thet
hingr
est
rai
nedorpr
event
edi
sawr
ongf
ulact

Ki
ndsofi
njunct
ion:Sect
ion35ofSpeci
fi
cRel
i
efActl
ayst
hat
,ther
ear
e2
ki
ndsofi
njunct
ions.

TEMPORARYI
NJUNCTI
ON PERPETUALI
NJUNCTI
ON

1.Iti
st oconti
nueunti
la 1.Itcanonl
ybegrantedbya
specifi
edti
meorunt i
lthe decreemadeattheheari
ng
furt
herorderofthecourt
.It anduponthemer i
tsoft
he
i
sgr antedatanyperi
odof suit.
suitandisregul
atedby
C.P.C.
 57

2.I
tisprov
isi
onal i
nitsnatur
e. 2.I
tfinal
l
ydeter
minesthe
I
tcannotconcludetheri
ght. r
ightsoft
heparti
esand
I
tmaybegi venwithout f
ormspartofthedecree
hear
ingthedefendant. madeattheheari
ng.

3.I
tcanbegr
ant
edatanyst
age
ofsui
t.
3.I
tcanonl
ybegrant
edatthe
f
inal
hear
ingoft
hesui
t.

4.Itmaybegr antedtothe
plaint
if
fonhi smaki ngoutof
4.I
tisgrant
edupont
hemer
it
s
primaf aciecaseinhis
oftheAct
.
support .

5.I
tisamer
eor
der
. 5.Aperpet
ual
inj
unct
ioni
sa
decr
ee.

6.Atemporaryi
njunct
ionhas
t
empor ar
ynatureasit
sname 6.I
thaspermanentnat
ure,f
inal
i
tsel
fimpli
es. decr
ee,asi
tsnameitsel
f
i
mplies.

7.I
tisr
egulat
edbythe
pr
ovi
sionsofC.
P.C. 7.I
tisgover
nedbyt
heSpeci
fi
c
Rel
iefAct
.

CLASSI
FICATI
ONOFI
NJUNCTI
ON

I
nrespectofnat
ural
act
,inj
unct
ionsmaybedi
vi
dedi
ntot
wo:
-
Pr
ohi
bit
oryandMandat
ory
.

PROHI BI
TORYINJUNCTION:Iti
sanorderofthecourtrestrainingthe
persontowhom i
tisdi
rect
edf r
om doi
ngcontinui
ngorr epeat i
ngsome
wrongfulact
,whi
chconsti
tut
esabreachoflegalorequitableobligat
ion
 58

ordut
y.

Exampl
es–

1.I
njunct
ionagai
nstenv
ironment
alpol
l
uti
on.

2.I
njunct
ionagai
nstexceedi
ngl
i
mitofnat
ural
rightt
odr
ainage.

MANDATORYI NJUNCTION:Iti
stheonewhichcommandst he
def
endantt
odosomeposi ti
veact.I
npropercasesonl
y,cour
tshav
e
powert
oissueaninj
uncti
onmandatoryi
nitsnatur
e.

b.Decl
arat
oryDecr
ees.
Sect
ion34&35expl
ainst
hepr
ovi
sionsaboutt
hedecl
arat
orydecr
ees.

Secti
on34:
-Di
scr
eti
onofcour
t,ast
odecl
arat
ionofst
atusorr
ightor
ti
tl
e.

Anypersonentit
ledtoanyl egalcharacteroranyrightast
oanypropert
y,
mayinsti
tut
easui tagainstaper son,denyingitoraboutt
odenyit
,or
i
nter
estedindeny i
ngit
.Suchr i
ghtorchar actershall
bedecl
aredbythe
cour
t,i
nitsdiscr
etion.

ESSENTI
ALS

 Aper
sonmusthav
eri
ghtort
it
leov
eranypr
oper
ty

 Aper
sonmustdenysuchr
ightort
it
le

 Cour
tati
tsdi
scr
eti
on,
candecl
aresuchr
ightort
it
le

Il
l
ust
rat
ion:-Inatr
ustpr
operty
,A, apersoncl
aimstobeatrusteeandB,
anot
herpersondeni
eshi
sright,because,i
fAwasnotther
e,thenB
woul
dhav ebecomethetr
ustee.Asui tmaybef i
l
edagai
nstaper son
whodeniesit
.

Theplainti
ffint
hiscase,canonl ycl
aim ordemandf ordecl
arat
ion,no
otherrel
iefscanbesought .Afterconsi
deringthecircumstancesofthe
case,thecourtarr
ivedataconcl usi
onandi tisjusttouseitsDi
screti
on
(Secti
on20ofSpeci fi
cReliefAct,1963-Discreti
onmustbesoundand
reasonable);
togiverel
iefbypassingaDi screti
onaryDecree.
 59

CaseLaw–I nIndianNav i
gati
onCompanyv /sHar yanaStateIndustri
al
Dev elopmentCor porat
ion,i
twasheldthattheexpr ession–“ Anyrightas
toanypr operty”wasbr oughtbythecourt
,butt heri
ghtmustbea
presentright(Pastorfutureri
ghtisnotsuf
ficient)
.Ther ightmustbei n
existencefrom thedateofsuittothedateofdecr ee.

Anagreementdoesnotent
it
leapersont
ogetalegalchar
act
erorri
ght
overanypr
opert
y,sothepr
ospect
ivepur
chaser
scannotseekthe
remedy.

Fr
ameofPl
aint
:-

 Ther
ightort
it
lecl
aimedbyt
hepl
aint
if
f

 Ci
rcumst
anceshowt
her
ightort
it
lewasobt
ained.

 Ci
rcumst
anceshowt
her
ighti
sdeni
edbyt
hedef
endant
.

 Pr
ayerorr
eli
ef,
towhatki
ndofdecl
arat
ion.

I
nQubool Singhv/sBoardofRev enuecase,
itwashel
dthatt
hepl
aint
if
f
mustshowt hepersist
entri
ghtorconti
nuousri
ght,
notonl
yonthedate
ofsui
t,butalsoatthedateofdecree.

Whensui
tfordecl
arat
iondoesnotl
i
e?

 Negati
vedecl
arat
ionnotall
owed.Example,
thepl
aint
if
fdi
dnot
i
nfr
ingethedef
endant’
strademar
korpropert
y

Ifi
nanancest
ralpr
operty
,iff
atherhashis‘Will’
,anditdoesnot
i
ncludet
henameoft heson,whoi sl
iabl
ef ortheshare,t
henthese
sui
tscanbebarr
ed,becausethereareotherreli
efs.

 Foradecl
arat
ion,
duringtheli
fet
imeofatest
ator
,‘
Wil
l’i
sinv
ali
d.
I
fthe‘Wil
l
’isr
evoked,thennoproper
tyshal
lbetr
ansf
err
edduri
ng
thel
if
eti
meoft hetestat
or.

 Thecourtshal
lnotdecl
aret
hattheplai
nti
ffi
sthepurchaserofan
unr
egist
ereddocumentoragreementorsaledeed.

 Nodecl ar
ator
ysuitshal
ll
ie,t
osetasideaSuccessi
onCer
ti
fi
cat
e
grantedundertheActNo.27of1860.Nowwef oll
ownewact
call
edIndianSuccessi
onAct,1925.
 60

 Nochanceofaskingdecl
arat
ionofnon-
exi
stenceofr
ight
,asof
successi
onoracqui
ri
ngar i
ghti
nfutur
e.

 Asui
tbystudentagai
nstUni
ver
sit
ythathehaspassed
ex
aminat
ion

 Thedecl
arat
orydecreest
endt
oaf
fectt
hef
reef
lowofcapi
tal
and
commerci
aloperat
ion.

Fur
therr
eli
ef,
wher
eapl
aint
if
fisent
it
led:
-

Secti
on34say s,
mer edeclarati
onwithout“Furt
herr
eli
ef”i
sawast e,i
n
cert
aincases.Sof ur
therr
el i
efheremeans“ Therel
i
eftowhichthe
plai
nti
ffi
snecessaril
yenti
tledonthebasisofdeclarat
ionoftheti
tl
e.”
Thisisdoneinordertoavoidmul t
ipl
i
cityofsuit
s.

Example,
ifAcl
aimst
hathei
sent
it
ledf
orhal
fpor
ti
onofhouse,
whi
chi
s
occupi
edbyB,t
henhecanpr
ay–

1.Thatadeclar
ati
oncanbemadet
hatAi
sent
it
ledt
ohal
fpor
ti
onof
thehouse.

2.That,
def
endantbeaskedt
odel
i
verhal
fpor
ti
onoft
hehouset
oA
(Ramsar
anv/sGangaDevi
)

Sect
ion35–Par
ti
eswhoar
eboundbydecl
arat
ion(
Eff
ectofdecl
arat
ion)

 Bi
ndi
ngonpar
ti
est
othesui
t.

 Personsclai
mingthr
ought
hem r
espect
ivel
y(Legal
hei
rsor
represent
ati
ves)

 Wher
eanypar
ti
esar
etr
ust
ee(
Woul
dbet
rust
ees)

I
fanyt
hingfai
l
edtobeaddedi
nthepl
aintt
hatcanbeamended.Thesui
t
mustbefi
ledwit
hint
ime.