Contract Law: An Introduction to Contract Law!
What is a Contract?
A voluntary and legally binding agreement between two or more competent parties. Contracts are usually written but may be spoken or implied, and generally have to do with employment, sale or lease, or tenancy. A contract is legally enforceable when it meets the requirements and is approved by the law. An agreement involves the exchange of goods, services, money, or promises of any of those. The Contracts or agreements between various parties are framed and validated by the Indian Contract Act. The making of a contract requires the mutual assent of two or more persons; one of them should be ordinarily making an offer and another accepting. If one of the parties fails to keep the promise, the other is entitled to legal redress.
Indian Contract Act, 1872-
The Indian Contract Act, 1872 defines the term ?Contract? under its section 2 (h) as ?An agreement enforceable by law.? In other words, we can say that a contract is anything that is an agreement and enforceable by the law of the land.
Requirements for a Valid Contract
- Mutual Assent: Each party must have an understanding regarding what the subject matter of the contract is.
- Offer and Acceptance: One party must make an offer by clearly communicating their intent to be bound in a contract. Likewise, the other party must render their acceptance in unambiguous terms.
- onsideration: This where both parties mutually exchange something of value to make the agreement binding. The consideration may be a formality, such as giving.
Competency: Parties Must Know What They're Doing. Those signing the contract and entering into the contract agreement must be competent. This means that they are of legal age to sign a contract; they have the mental capacity to understand what they are signing, and they are not impaired at the time of signing ? meaning they are not under the influence of drugs or alcohol
Breach (Breaking) of Contract
Breach of contract is a legal cause of action and a type of civil wrong, in which a binding agreement or bargained-for exchange is not honored by one or more of the parties to the contract by non-performance or interference with the other party's performance. A breach occurs when a party to a contract fails to fulfill its obligations as described in the agreement or communicates intent to fail the obligation or otherwise appears not to be able to perform its obligation under the contract. Where there is a breach of contract, the resulting damages will have to be paid by the party breaching the contract to the aggrieved party.