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Business Environment and Law-Law Of Contract (Indian Contract Act 1872)

Kinds Of Contracts - Law Of Contract

   Posted On :  06.05.2018 11:06 pm

Circumstances in which a contract is voidable are:

Kinds Of Contracts

  1.   Valid Contract: It is an agreement which fulfils all the essentials of enforceability and can be enforced by either of the parties at the courts of law.
  2.  Voidable contract: Sec 2(i) lays down that “An agreement which is enforceable by law at the option of one or more of the parties thereto, but not at the option of the other or others, is a Voidable Contract.” This arises where the consent of one of the parties to the contract is not free. Ex., A, at the point of pistol makes B agree to sell his bicycle for Rs.500. Here B’s consent is not free.

Circumstances in which a contract is voidable are:

 (A) At the conception

1. Consent caused by fraud (Sec.14, 17 and 19)

2. Consent caused by coercion (Sec. 14, 15 and 19)

3. Consent caused by misrepresentation (Sec. 14, 18 and 19)

4. Consent caused by undue influence (Sec. 14, 16 and 19A)

5. When one party induces another to enter into an agreement the object of which is unlawful though it is not known to the other party.
 
 (B) By Subsequent Default

1. Where offer of performance is not accepted (Sec. 38)

2. When one party prevents performance of reciprocal promise (Sec. 53)

3. When a party fails to perform at the time fixed, if time is the essence of the contract (Sec. 55)


Consequences of Recession of Voidable Contract


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