Business Environment and Law-Law Of Contract (Indian Contract Act 1872)
Unlawful Agreements-Law Of Contract
Posted On :
According to the Indian Contract Act, “The consideration or object of an agreement is lawful, unless it is forbidden by law; or is of such a nature that, if permitted, it would defeat the provisions of any law; or is fraudulent; or involves or implies injury to the person or property of another; or the court regards it as immoral, or opposed to public policy.
Unlawful
Agreements
According to the Indian Contract Act (Sec. 23), “The consideration or object of an agreement is lawful, unless it is forbidden by law; or is of such a nature that, if permitted, it would defeat the provisions of any law; or is fraudulent; or involves or implies injury to the person or property of another; or the court regards it as immoral, or opposed to public policy.
Let us
see the provisions of Sec. 23 which make an agreement unlawful.
According to the Indian Contract Act (Sec. 23), “The consideration or object of an agreement is lawful, unless it is forbidden by law; or is of such a nature that, if permitted, it would defeat the provisions of any law; or is fraudulent; or involves or implies injury to the person or property of another; or the court regards it as immoral, or opposed to public policy.
1. Forbidden by law: If the object of the agreement or
the consideration of the agreement
is the doing of an act which is forbidden by law, the agreement is void.
2. If it is
of such a nature that, if permitted, it would defeat the provisions of any law: i.e. it would indirectly lead to a violation of the law.
3. If it is fraudulent: Any
agreement whose object is to defraud others
is void.
4. If it involves or implies injury to the person or property of another:
5. If the
Court regards it as immoral.
6. f the
Court regards it as opposed to public policy: The
following agreements
have been held to be against public policy:
a. Trading with Enemy:
b. Agreements for stifling
prosecution: An agreement to suppress criminal charge is void because if a
person has committed a crime, public policy requires that he should be
prosecuted.
c. Agreements interfering with the
Course of Justice: An agreement entered into with the object of exercising
improper influence on judges or officers of justice is bad in law as opposed to
public policy.
d. Agreements tending to an abuse of
legal process: There may be two types of agreements under this head, one is
Maintenance and the other is Champerty.
e. Agreement to vary the period of
limitation: An agreement that reduces or increases the period of limitation as
laid down by the law of limitation is opposed to public policy.
f. Traffic in Public Offices: An
agreement whereby an appointment to a public office is procured for monetary
consideration is against public policy because it would cause corruption in
administration of the State.
g. Agreement creating an interest opposed to duty
h. Agreements restraining personal freedom
i. Agreements opposed to parental
rights and duties: Father is supposed to be the guardian of his children and in
the absence of the father their mother acquires this right as well as
responsibility and this right cannot be bartered away.
j. Marriage Brokerage Agreements:
Agreement to pay reward to a person for negotiating marriage is opposed to
public policy.
The
following agreements are also opposed to public policy.
i. Agreements in restraint of marriage.
ii. Agreements in restraint of trade.
iii. Agreements in restraint of legal proceedings.
i. Agreements in restraint of marriage.
ii. Agreements in restraint of trade.
iii. Agreements in restraint of legal proceedings.
Tags : Business Environment and Law-Law Of Contract (Indian Contract Act 1872)
Last 30 days 6567 views
