Introduction to Law

INTRODUCTION

We enter into contracts day after day. Taking a seat in a bus amounts to entering into a contract. When you put a coin in the slot of a weighing machine, you have entered into a contract. You go to a restaurant and take snacks; you have entered into a contract. In such cases, we do not even realize that we are making a contract. In the case of people engaged in trade, commerce and industry, they carry on business by entering into contracts.

The law relating to contracts is to be found in the Indian Contract Act, 1872.The law of contracts differs from other branches of law in a very important respect. It does not lay down so many precise rights and duties which the law will protect and enforce; it contains rather a number of limiting principles, subject to which the parties may create rights and duties for themselves and the law will uphold those rights and duties. Thus, we can say that the parties to a contract, in a sense make the law for themselves. So long as they do not transgress some legal prohibition, they can frame any rules they like in regard to the subject matter of their contract and the law will give effect to their contract.

Definition of contract

According to section 2(h) of the Indian contract act, 1872. “An agreement enforceable by law is a contract. Section 2(e) defines agreement as ‘’every promise and every set of promises forming consideration for each other. A promise is a proposal when accepted; therefore an agreement consists of a proposal or offer from one party and its acceptance by another.

According to SALMOND, a contract is “An agreement creating and defining obligations

Between the parties”

Contract = Agreement + Enforceability by law

Agreement = Offer + Acceptance

Obligation

An agreement, to become a contract, must give rise to a legal obligation or duty. The term ‘obligation’ is defined as a legal tie which imposes upon a definite person or persons the necessity of doing or abstaining from doing a definite...