Business Law
...CONTRACT
Section 10 deals with the 5 elements of contracts
Section 10 provides “All agreements are contracts if they are made by the free consent of the parties competent to contract, for a lawful consideration and with a lawful object, and are not hereby expressly declared to be void. Nothing herein contained shall affect any law in force in India and not hereby repealed, by which any contract is required to be made in writing or in the presence of witnesses or any law relating to the registration of documents.
In addition, the sixth element '' though not specified in the law viz., “intention to create legal obligations” is also considered. This intention could be express or inferred.
Balfour V. Balfour (1919 2 KB 571 CA)
A husband and wife were residents in Ceylon where the husband was employed. Then went to England on leave. At the end of leave, husband had returned but wife stayed back on account of illness. The husband promised to send her a maintenance allowance of GBP30 a month until she returned to Ceylon.
Held there was no binding contract but a mere domestic arrangement which could not be sued upon.
Rose and Frank Co V. Crompton & Bros. Ltd. (1925 AC 445)
The plaintiffs, an American firm was constituted as selling agents for defendants, an English Company through a written agreement with the following clause.
“This arrangement is not entered into,…, as a formal or legal agreement, and shall not be subject to legal jurisdiction in the Law Courts.”
Held the agreement was not legally binding.
Let us see what each of these elements signifies in formation of a contract.
Re. Consent
Section 13 Two or more persons are said to consent when they agree upon the same thing in the same sense.
consensus ad idem (Latin) '' An agreement of parties to the same thing; meeting of minds.
Section 14 Consent is said to be free...
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