Apex Law Journal
Apex Law Journal
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Editor

Neha Goel, Advocate

Advisory Board

S.C. Khunger, Advocate

Rohit Bansal, Advocate

Varinder Singh Kanwar, Advocate

Hittan Nehra, Advocate

Judgments on Indian Contract Act, 1872

Friday, January 27, 2012
Indian Contract Act, 1872

Indian Contract Act, 1872 — Section 139 — Liability of the guarantor — Held, the liability of the guarantor is equal to and co-extensive with the borrower and it is highly doubtful that the guarantor can avoid his liability simply on the basis of the promissory note made out or an equitable mortgage created by the borrower in favour of the lender.

 
Thursday, December 08, 2011
Indian Contract Act, 1872

Contract Act, 1872 — Sections 59 and 60 — Applicability of — Held, sections 59 and 60 of the Contract Act, 1872, would only be applicable at the pre-decretal stage and not thereafter and that post-decretal payments would have to be made either in terms of the decree or in accordance with the agreement arrived at between the parties, though, on the genuine principles indicated in Sections 59 and 60 of the aforesaid Act — M/s I.C.D.S. Ltd. Vs. Smithaben H. Patel & Ors. [(1999) 3 SCC 80] relied.

 
Friday, September 09, 2011
Indian Contract Act, 1872

Indian Contract Act, 1872 — Section 5 — Under the cover of the provisions contained in Section 5 of the Act, the respondent cannot escape from the obligations and liabilities under the agreements contained in its offer/bid.

 
Indian Contract Act, 1872

Indian Contract Act, 1872 — Section 5 — The right to withdraw an offer before its acceptance cannot nullify the agreement to suffer any penalty for the withdrawal of the offer against the terms of agreement — A person may have a right to withdraw his offer, but if he has made his offer on a condition that the Bid Security amount can be forfeited in case he withdraws the offer during the period of bid validity, he has no right to claim that the Bid Security should not be forfeited and it should be returned to him — Forfeiture of such Bid Security amount does not, in any way, affect any statutory right under Section 5 of the Act.

 
Wednesday, August 31, 2011
Indian Contract Act, 1872

Contract Act, 1872 — Section 221 — Agent has a right to remain on the property of the principal under Section 221 of the Contract Act, for the reliefs which are available under that section if he makes out such a case. 

 
Friday, July 15, 2011
Indian Contract Act, 1872

Contract Act, 1872 — Section 51 — Held, Section 51 provides that when a contract consists of reciprocal promises to be simultaneously performed, no promisor need perform his promise, unless the promisee is ready and willing to perform his reciprocal promise — For example, if the contract provides that the balance of sale consideration shall be paid by the purchaser to the vendor against execution of sale deed within a period of three months, the purchaser need not pay the balance sale consideration if the vendor was not willing to execute the sale deed. Similarly the vendor need not execute the sale deed unless the purchaser is ready to pay the balance sale consideration.  

 
Indian Contract Act, 1872

Contract Act, 1872 — Section 52 — Held, Section 52 relates to the order of performance of reciprocal promises. It provides that where the order in which reciprocal promises are to be performed is expressly fixed by the contract, they shall be performed in that order; and where the order is not expressly fixed by the contract, they shall be performed in that order which the nature of the transaction requires — Let us illustrate with reference to an agreement of sale which provides that the vendor shall make out to the satisfaction of the purchaser a good, marketable and subsisting title and provide all documents as required by the purchaser to satisfy him about the title of the vendor, that the vendor shall obtain a certificate of clearance from a specified authority for the sale, that the sale shall be completed within a period of four months of receipt of the clearance certificate and the purchaser shall pay the balance sale price at the time of registration of the sale — It is evident that the vendor will have first to make out a title by producing the documents required by the purchaser and also obtain the clearance certificate — Only thereafter the sale deed shall have to be executed and payment of the sale consideration will have to be made at the time of registration of the sale deed — The vendor cannot seek payment of the balance sale price without performing his obligations as per the agreement.

 
Indian Contract Act, 1872

Contract Act, 1872 — Section 53 — Held, Section 53 provides that when a contract contains reciprocal promises, and one party to the contract prevents the other from performing his promise, the contract becomes voidable at the option of the party so prevented; and he is entitled to compensation from the other party for any loss which he may sustain in consequence of the nonperformance of the contract — Let us take by way of illustration an agreement which provides that out of the sale price Rs.10,00,000, Rs.1,00,000 was paid as advance, Rs.4,00,000 was to be paid within one month to enable the vendor to purchase an alternative property and shift his residence from the property agreed to be sold, and the sale deed has to be executed within three months from the date of agreement of sale and vacant possession of the premises should be given, against payment of balance price — If the purchaser failed to pay Rs.4,00,000 within one month and thereby prevented the vendor from purchasing another property and shifting to such premises, the vendor will not be able to perform his obligation to deliver vacant possession — Thus the contract becomes voidable at the option of the vendor. 

 
Indian Contract Act, 1872

Contract Act, 1872 — Section 54 — Held, Section 54 of Contract Act provides that when a contract consists of reciprocal promises, such that one of them cannot be performed, or that its performance cannot be claimed till the other has been performed, and the promisor of the promise last mentioned fails to perform it, such promisor cannot claim the performance of the reciprocal promise, and must make compensation to the other party to the contract for any loss which such other party may sustain by the non-performance of the contract — The agreement in this case provides a good illustration for this section — The purchaser cannot claim that the vendors should produce the original title deeds and satisfy her regarding their title, or claim execution of the sale deed, unless and until she paid the entire consideration within the time stipulated in clause (4) of the agreement, which would enable the vendors to repay the loans and obtain release of the original title deeds.

 
Indian Contract Act, 1872

Contract Act, 1872 — Section 52 — The order of performance of reciprocal promises does not depend upon the order in which the terms of the agreement are reduced into writing — The order of performance should be expressly stated or provided — Therefore contention of the appellant, in the present case, that the vendors  should first satisfy the purchaser regarding title of the vendors and only when that promise is performed by the vendors, the question of purchaser performing her promise to pay the balance consideration would arise, held, cannot be accepted as there is no such express fixation of the order in which the reciprocal promises are to be performed.

 
Tuesday, October 13, 2009
Indian Contract Act, 1872

Contract Act, 1872 — Section 74 — It is true that Section 74 declares the law as to liability upon breach of contract where compensation is by agreement of the parties pre-determined — However, in the absence of any agreement specifying damages for the breaches alleged by the respondent, Section 74, in the facts and circumstances, is not at all attracted. 

 
Saturday, November 15, 2008
Indian Contract Act, 1872

Indian Contract Act, 1872 — Section 25 — Joint property — In the present case, a deed of partition was executed wherein sisters relinquished their share in favour of their brother for a consideration of Re.1/- only — Deed of partition is in writing and registered — Held, deed of partition is valid — Love and affection is also a consideration — Transfer of Property Act, 1882, Sections 122 and 123.

 
Indian Contract Act, 1872

Indian Contract Act, 1872 — Section 19 — Civil Procedure Code, 1908 — Order 6, Rule 4 — When a contract is said to be voidable by reason of any coercion, misrepresentation or fraud, the particulars thereof are required to be pleaded.

 
Indian Contract Act, 1872

Indian Contract Act, 1872 — Sections 2(d) and 25 — Consideration — Release by an heir other than a co-parcenar does not need any consideration — A release is valid even without consideration.

 
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