Shaik Sadiq

Hakani
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CONTRACT &
CONTRACT

AGREEMENT
 Contract
A Contract is an agreement between
two or more parties which will be
administered by law as per Sec 2(h)
of Indian Contract Act, “An
agreement enforceable by law is a
contract”. Hence contract is an
agreement, whose objective is to
establish a legal obligation i.e., a
duty and enforceable by law.

Agreement
According to the sec 2(e) “Every
promise and every set of
promises, forming the
consideration for each other, is an
agreement”. This statement
makes it clear that ‘Promises’ is
an agreement.
 Classification of
Contracts
Contracts are classified on the basis of
the following,

1. Validity
2. Formation
3. Performance

l. Classification Based on Validity

A Contract is formed on the basis
of an agreement. An agreement would
become a valid Contract when all the
essential elements of a contract are present.
If in case one or more essential element of
the contract are missing then it would be
either voidable, void, illegal or unenforceable
contract but not a valid Contract.
1. VOIDABLE CONTRACT
Sec.2(I) Of the Indian Contract Act
defines,
“An agreement that is enforceable by
law at the option of one or more of the
parties there to,but at the option of the
other or others is a voidable contract.

This form of contract is formed in case

when one of the essential element i.e.,
‘free consent’ is not present .If the
consent of the party to a contract is not
free that is, when it is form due to
Coercion , undue influence,
misrepresentation or fraud ,the
contract is said to be voidable at his
option section 19 and 19A .The party
whose consent is not free can rescind
(avoid or refuge) the contract if he is
intended to do so. A voidable contract is
valid until it is avoided by the party
2. Void Agreement and Void
Contract
(a)Void Agreement
“An agreement not enforceable by law is said to be
void”agreement does not create
Void
any legal rights or obligations it is
“devoid of legal effects”
altogether or it is void –ab initio
which means from the very
beginning.
Example ,an agreement with a
minor or agreement without
consideration.

(B) Void Contract

Section 2(j) of the contract Act 1872 defines,
“A Contract becomes void when it ceases to be
enforceable by law”.
 3.Illegal Agreement

Illegal agreements is an
agreement where one goes
beyond the legally accepted
rules of fundamental public
policy or which is criminal in
nature or which is immoral.
Illegal agreement has much
greater significance compared
to the void contract . All illegal
agreements are void but all
void agreements or contract or
not necessary illegal.

4. Unenforceable contract
A contract which is unenforceable in the court of law due to some technical defect
like absence of writing where remedy has been barred by lapse of time is called as an
unenforceable contract. The concerned parties may carry out the contract but in case of
breach or repudiation of such a contract the aggrieved party would not be empowered to
the legal remedies.
II. Classification Based on
Formation
Contract may be made or formed either by writing or by words of mouth or it is inferred
from the conduct of the parties or the conditions / situations of the case this constitute the
various modes to form a contract . Classification of Contracts based on formation are as
follows,
1. Expressed Contract
If in case the terms of a contract are in expressed form either by words spoken or
written during the formation of the contract is called as expressed contract. Where the
offeror acceptance of any promise is made in words then, promise is said to be expressed
section 9 of the contract act and an expressed promise would lead to an expressed
contract.
2. Implied Contract
Contract which is implied from the acts or conduct of the parties or course of dealings
between them is termed as an “implied contract”. This is the result of the specific acts of
the concerned parties but not the expressed promise or the promises made by the parties.
It may also result out of continuing course of conduct of the parties. Section-9 of the
contract Act states , the proposal or acceptance of any promise is made other than words,
then the promise is said to be implied.
3. Quasi
Contract
Quasi contract is not at all a contract it is
entered intentionally by the parties on the
other hand the quasi contract is created by
law. It is similar to a contract where legal
obligation is applied on a party we should
perform it. It lays on the ground of equity
that “a person may not be allowed to enrich
himself unjustly at the expense of another”
Example:
‘A’ a businessman forgot to take his goods
from ‘B’ s house by mistake .B treats the
goods as his own. In this case B is bound to
payE-commerce
4. for the goods.Contract
A contract which is entered into by the two
parties via Internet is called an E-
Commerce contract various individuals or
companies develop networks on internet
that are attached / related with many other
networks . Thus, there is an expansion of
commercial transaction for any person.
III. Classification Based on
Performance
The extent upto which contracts can be performed are
categorised into four heads. Namely,

1. Executed Contract

The term executed means the task which is completed a

contract where both the parties have perform their
respective obligation is an executed contract

2. Executory Contract

Executory means something that remains to be carried

into effect. A contract where both the parties are yet to
perform their obligations is an executory contract.
3. Unilateral or One-sided
Contract
A Unilateral or One- sided contract means only
one party should fulfill his obligations during
the formation of the contract and the other
party fullfils the obligation at the time of
contract or prior to the existence of the
contract. These contracts are also termed as
contracts with executed consideration.

4. Bilateral Contract
A bilateral contract means a contract where
the obligations of both the parties remain
outstanding at the time of formation of the
contract. Thus, it is similar to executory
contract. Thus, it also termed as contract with
executory consideration.
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