Define contract. State essential elements of a valid contract.(2017)
Category : Contract – I
Section 2(h) of Indian Contract Act 1972 – An agreement enforceable by law is a contract.
Def. by Anson – A contract consists in an actionable promise or promises.
Def. by Sevigni – Contract is a combination of agreement and responsibility. Def. by Pollock – An agreement or promise enforceable by law is contract.
Section 10 – All agreements that are made by people competent to contract, with free consent, for a lawful object and lawful consideration and not expressly declared to be void are contracts.
Thus, we get the following elements
1. There must be two or more people involved.
2. There must be an intention to contract. Balfour vs Balfour 1919 – Husband promised to send money to wife. Not a contract because there was no intention to contract.
3. There must be an agreement to do or to abstain from doing something.
4. The agreement must involve a lawful purpose, which means – agreement must not be against marriage, trade, legal proceedings, or it must not be a wagering agreement or must not be expressly prohibited by law.
5. Agreement must not be uncertain
6. Must not be impossible. Sec 56.
7. Free consent – not vitiated by coercion, undue influence, fraud, or misrepresentation.
8. Parties must be competent to contract.
9. Lawful consideration.
10. Lawful object.
11. Legal formalities
12. Must be enforceable by law, which means must not be immoral or against public policy