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Civil Law

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1. Legal Principle: An offer made and accepted with an intention to enter into legal contract is enforceable.
Factual Situation: Romeo promised a gold necklace to Juliet at the time of their marriage. Romeo fails to bring the necklace.
Issue: Can Juliet claim the necklace?
Decision:

Juliet can claim the necklace.NoneJuliet cannot claim the necklace as there is no consideration from Romeo.

2. Legal Principle: A counter offer doesn't give rise to contractual binding.
Factual Situation: D wrote to P on November 28, 1971, offering to sell 800 tons of iron at ' 6,900 per ton. On the same day, P wrote to D offering to buy 800 tons of iron at ' 6,900 per ton. The two letters crossed in post and neither of them knew any thing about the offer to the other. P contended that there was a good contract.
Issue: What is the nature of contract and liabilities of the parties?
Decision:

It is a voidable contract at the option of P because P had offered to buy the product.It is a voidable contract at the option of D because D had offered to sell the product.NoneThere was no valid contract because an agreement results into a contract when there is an offer from one side and its acceptance from the other side so no question of any liability rises.

3. Legal Principle: A contract requires a proposal and an acceptance of the proposal. It is necessary to make a binding contract, not only that the proposal be accepted, but also that the acceptance is notified to the proposer.
Factual Situation: Harvey sent a telegram to Facey stating 'Will you sell us the estate of Bumber Hall Pen for £900' Harvey sent another telegram to fancy stating 'We agree to buy Bumper Hall Pen for a sum of £900 asked by you. Please send us your title deeds in order that we may get early of possession'. But Facie did not send any reply to the last telegram sent by Harvey. Hence Harvey filed a case against Facie claiming Bumber Hall Pen estate.
Issue: Is there valid contract between Harvey and Facie?
Decision:

There is not valid contract because there is no acceptance of the offer.Yes there is a valid contract because Harvey made an offer for three times and Facie didn't respond which amounts to his acceptance.NoneIt is voidable contract at the option of Harvey because Harvey had made repeated offers.

4. Legal Principle: A contract procured by coercion is bad under Indian Contract Act. Coercion is defined as committing or threatening to commit any act forbidden by Indian Penal Code. Attempt to commit suicide is an offence under Indian Penal Code.
Factual Situation: By threat of suicide, a Hindu induced his wife and son to execute a release in favor of his brother in respect of certain properties which they claimed as their own.
Issue: Is the deed valid?
Decision:

None.NoneThe deed is valid and can be executed.The threat of suicide amounted to coercion within Section 15 and the release dead was voidable.

5. Legal Principle: Knowledge of the offer to the person to whom it is signified and its acceptance by the same person results into contract.
Factual Situation: The board of managers of a school resolved to appoint P as headmaster. One of the managers, in his individual capacity, informed P of the same. But there was no formal communication of the resolution by the board. The board later rescinded the resolution.
Issue: What is the nature of contract and liability of the board of managers?
Decision:

NoneThere is a valid contract as one of the managers had informed in his individual capacity.There is no contract as there is no communication from the side of the board of managers.

6. Legal Principle: The object of an agreement is lawful unless it is forbidden by law; is of such a nature that, if permitted, it would defeat the provisions of any law; is fraudulent; involves or implies injury to the person or property of another person; the court regards it as immoral; it is opposed to public policy.
Factual Situation: A promises B, the owner of a newspaper ' 500 in consideration of the publication by B, in his newspaper of false statements in regard to a candidate for election. B published them.
Issue: What is the nature of agreement?
Decision:

NoneThe agreement is voidable at the option of B.The agreement is valid and B can sue A.The agreement is void as it is against the public policy.

7. Factual Situation: Mr Mukesh invites Mr Vijay to a dinner at a hotel. Mr Vijay accepts the invitation. It is purely a social agreement. Mr Vijay fails to arrive at the dinner and finds out that Mr Mukesh has to go out and is not available at his place at the dinner time due to some important work.
Issue: Is Mr Vijay liable for the non-performance of contract with Mr Mukesh.
Decision:

NoneMr Vijay's liable because he has not performed the contract.It will be the discretion of the court.Mr Vijay is not liable because there was no contract; it was just a social agreement.

8. Legal Principle: Communication of offer and acceptance is must for a valid contract.
Factual Situation: A proposes by letter, to sell a house to B at a certain price. A revokes his proposal by telegram.
Issue: Whether the revocation of an offer is valid?
Decision:

Yes revocation of offer is valid because revocation of offer is complete as against A when the telegram is dispatched.NoneRevocation of offer is not valid because it is not complete.

9. Legal Principle: A minor is a person who is below the age of 18. However, where a guardian administers the minor's property the age of majority is 21.
Factual Situation: M, a guardian, on behalf of a minor, L entered into a contract with S for purchase of certain property for the benefit of L.
Issue: Is the contract valid?
Decision:

Yes, provided it is within the scope of guardian's authority.No, it is not a valid contract because any contract with the minor or on his behalf is void. NoneNone.

10. Legal Principle: The act of using influence on another and taking undue advantage of that person is called undue influence.
Factual Situation: A borrowed ' 50,000 at 12% per annum interest from B repayable on demand. B made the demand and on failure of A to pay, he was about to sue A to get back his money. A requested B to postpone the filing of suit and agreed to pay interest at the rate of 18% per annum. On refusal to pay interest at 18%, B filed a suit.
Issue: Whether B will succeed in his suit?
Decision:

No he will not succeed because he himself offered to pay 18% interest per annum.It is a voidable contract so B will not succeed.NoneHe will succeed in his suit because he was forced to pay 18% under undue influence which vitiates the validity of contract because one of the basic essential features of a valid contract is that it should be entered into with free consent.

11. Legal Principle: Where both parties to an agreement are under a mistake as to matter of fact essential to the agreement, the agreement is void.
Factual Situation: A, contracts with B to buy a necklace, believing it to be made of very costly rare pearls, while in reality, the pearls are only an imitation having very little value. B knows that A is mistaken but does not disclose the facts.
Issue: Is A bound by the contract?
Decision:

No, A is not bound by the contract because the rule of caveat venditor applies on B.Yes, because the rule of caveat emptor will apply.No, A is not bound by the contract because it is not a unilateral mistake.None

12. Legal Principle: Mere promise without any intention to enter into legal relationship does not give rise to contractual liabilities.
Factual Situation: D promised ' 500 to a fund for P re-building a mosque. Nothing had been done to carry out repairs and reconstruction. The secretary of the mosque filed a suit for the recovery of ' 500.
Issue: What is the liability of D?
Decision:

The promise was not enforceable because D who made the promise gained nothing in return for the promise made. The secretary of the committee to whom the promise was made suffered nothing as nothing had been done to carry out the repairs.D is liable because he had promised.D is liable because the promise made by D was duly accepted.None

13. Legal Principle: A counter offer doesn't give rise to contractual binding.
Factual Situation: A offered to sell a farm for £1,000, X said he would give £950. A refused and X then said he would give £1,000, and when A declined to adhere to his original offer tried to obtain specific performance.
Issue: Is there a valid contract between A and X?
Decision:

There is a valid contract and A is liable for specific performance.There is not valid contract as X's offer to pay £950 is a refusal of the offer and a counteroffer.It is voidable contract at the option of X.None

14. Legal Principle: The object of an agreement is lawful unless it is forbidden by law; is of such a nature that, if permitted, it would defeat the provisions of any law; is fraudulent; involves or implies injury to the person or property of another person; the court regards it as immoral; it is opposed to public policy.
Factual Situation: P advanced money to D a married woman to enable her to obtain a divorce from her husband and D agreed to marry her as soon as she obtained a divorce.
Issue: Can P sue D for the recovery of money?
Decision:

P was not entitled to recover back the amount as the agreement had for its object the divorce of D from her husband which is unlawful and against morality and public policy.P can sue D for the recovery of money.None.None

15. Legal Principle: When, at the desire of the promisor, the promisee or, any other person has done or abstained from doing, or does or abstains from doing, or promises to do or to abstain from doing, something, such act or abstinence or promise, is called a consideration for the promise.
Factual Situation: Mr A tells B during a conversation that he will give ' 10,000 to anyone who marries his daughter with his consent. B marries A's daughter with A's consent.
Issue: Is B entitled to recover the money from A?
Decision:

NoneB can't recover the money from A because what A says is only a statement of intention and not offer.Yes, B can recover the money because once the offer was made and accepted it had resulted into a valid contract and liability arises.None.

16. Legal Principle: A minor is not permitted by law to enter into a contract. Hence, where a minor enters into a contract with a major person, the contract is not enforceable. This effectively means that neither the minor nor the other party can make any claim on the basis of the contract.
Factual Situation: A, a minor who wished to become a professional billiards player, entered into a contract with B, a noted billiard payer, to pay him (B) a certain sum of money to learn the game and play matches with him during his world tour. B spent time and money in making arrangements for billiards matches.
Issue: Is A liable to pay?
Decision:

This agreement is voidable at the option of B.No, because the agreement with a minor is void.NoneYes, as the agreement was for necessaries. Necessaries include education, training for trade, medical services, etc.

17. Legal Principle: The act of using influence on another and taking undue advantage of that person is called undue influence.
Factual Situation: An arrangement was made between the fathers of a groom and a bride before their marriage that each would pay a certain sum of money to the husband. Father of the boy paid the promised amount but his wife's father failed to pay the amount. The boy sued his father-in-law for the recovery of the promised amount of money.
Issue: Whether the boy can recover the money.
Decision:

He can recover because they had entered into a contract before the marriage.He cannot recover the amount, because no stranger to the consideration can take advantage of a contract made even for his benefit.None

18. Legal Principle: An agreement becomes a contract when it is entered into between two or more people with each other's free consent. Two or more people are said to consent when they agree to the same thing in the same sense. Consent is said to be free when it is not caused by coercion, undue influence, fraud, misrepresentation, or mistake.
Factual Situation: A agreed orally to sell his house to B for ' 5,000, 'Subject to contract'. The next day C offered A ' 6,000 for the house and A accepted this offer and sold the house to C. Can B sue A for breach of contract? Would it make any difference to your answer if the agreement between A and B was in writing?
Issue: What is the liability of A and C?
Decision:

NoneAn oral contract is perfectly valid except where writing, registration, etc. is required by some statute. B cannot sue A for breach of contract because the formalities required under the Transfer of Property Act, 1882, had not been completed. Had this agreement been in writing and registered, B could sue A.A and C both are liable because it does not matter whether the agreement is oral or written.

19. Legal Principle: When the parties to an agreement agree on the same thing in the same sense, there arise legally binding obligations between them.
Factual Situation: A who owns two cars, one Maruti and the other Santro, offers to sell B one car. A intends to sell the Maruti car. B accepts the offer thinking that it is the Santro.
Issue: Is A liable?
Decision:

A is not liable because there is no consensus and hence no contract.NoneA is liable because once he had offered the contract is complete.It is upto the court to decide the liability.

20. Legal Principle: 1. The act of using threats to force another person to enter into a contract is called coercion. 2. In order to prove coercion, the existence of the use of threat, in any form and manner, is necessary. I. coercion is proved, the person who has been so threatened can refuse to abide by the contract.
Factual Situation: A, threatens to shoot C (B's son), if B does not release him (A) from a debt which A owes to B. B signs necessary documents and thus releases A under the threat.
Issue: Can B get back his loan afterwards?
Decision:

It will be the discretion of the court.B can get back his loan amount, as his consent for release was obtained by coercion.NoneNo, B cannot get back his loan afterwards.

21. Legal Principle: A right of action cannot arise out of an illegal activity.
Factual Situation: A agrees to pay ' 50,000 to B if B kills C to pay to B, A borrows ' 50,000 from D who is also aware of the purpose of loan. B kills C but A refuses to pay. A also refuses to repay the loan to D.
Issue: What is the nature of contract?
Decision:

A is liable to pay the amount to D because D has no involvement in the offence of murder.The agreement between A and B is an illegal agreement because its object is unlawful. Hence B cannot recover anything from A. Since the main agreement between A and B is illegal the agreement between A and D which is collateral to main agreement is also void, and hence D cannot recover anything from A.A is liable to pay ' 50,000 to B though B is guilty of offence of murder. But the agreement between A and B is valid and hence enforceable.None

22. Legal Principle: A contract requires a proposal and an acceptance of the proposal. It is necessary to make a binding contract, not only that the proposal be accepted, but also that the acceptance is notified to the proposer.
Factual Situation: Mr A is a merchant of Delhi. He sends his son B to Mumbai with a letter addressed to a merchant of Mumbai. B hands over the letter to C and keeps waiting there. C reads the letter which contains an offer from A for sale of certain quantity of rice. The letter also contains that if C accepts the offer, then he must give his reply to B. C sends B without any reply, but later decides to accept A's offer by telegram. The telegram reaches A before B returns.
Issue: Has a valid contract come into existence?
Decision:

NoneIt is a contract voidable at the option of A. There is a valid contract once C sends the telegram.No, But A must inform C within reasonable time that acceptance is not made according to the prescribed mode.

23. Legal Principle: The act of using influence on another and taking undue advantage of that person is called undue influence.
Factual Situation: A poor Hindu widow who was in dire need of money, was forced by a money lender to agree to pay 100% rate of interest.
Issue: Is it a case of using undue influence?
Decision:

The money lender can ask for the specific performance of contract as there is no indication of any undue influence because lady herself had approached the money lender and voluntarily agreed to pay 100% interest.NoneIt is a case of exerting undue influence upon a person of mental distress. So the contract is not valid and the money lender cannot plead for the specific performance of the contract.

24. Legal Principle: 'When, at the desire of the promisor, the promisee or, any other person has done or abstained from doing, or does or abstains from doing, or promises to do or to abstain from doing, something, such act or abstinence or promise, is called a consideration for the promise'.
Factual Situation: The Carbolic Smoke Ball Co. offered by advertisement a reward of £100 to any person who should contract influenza after having used the smoke ball three times daily for two weeks according to the printed directions. It also added that £100 deposited in the bank showing its sincerity in the promise. The plaintiff Mrs Carlill used the smoke ball according to the directions to the company but contracted influenza.
Issue: Is the company liable to give the reward and is Mrs Carlill entitled to an award as prayed for?
Decision:

Mrs Carlill is not entitled because there is no valid contract.Yes, company is liable, Mrs Carlill is entitled to an award because the performance of the conditions is a sufficient acceptance without notification.NoneCompany is not liable.

25. Legal Principle: 'When, at the desire of the promisor, the promisee or, any other person has done or abstained from doing, or does or abstains from doing, or promises to do or to abstain from doing, something, such act or abstinence or promise, is called a consideration for the promise'.
Factual Situation: An old lady Laxmi Rani gifted her property to her own daughter Ramayya, with the direction to pay a certain sum of money annually to Chinayya, her maternal uncle. On the same day, Ramayya executed an agreement with Chinayya agreeing to pay the amount annually. Later on, Ramayya refused to honor the agreement on the ground that there is no consideration. Chinayya sued for the recovery of the annuity.
Issue: What is the nature of contract?
Decision:

There is no contract.NoneThere was no agreement between Chinayya and Ramayya so Ramayya is not liable.There was sufficient consideration, that is, the property was given to her by the sister of Chinayya so Ramayya was liable to pay.

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