1. Legal Principle: An agreement made with the intention of entering into legal relationship gives rise to contractual liabilities. Factual Situation: X invited Y and this family to dinner on a certain night. Y accepted X’s invitation. On the date fixed Y drove with his family from Sector 14 to Industrial Area and found X’s house locked. They waited upto 9.30 p.m. but hosts did not turn up. They left the place and had their meals in Piccadilly in Sector 17. The cost of meal came to 100. Issue: Can Y recover the amount? Decision:

2. 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:

3. Legal Principle: A contract obtained by misrepresentation is voidable at the option of the buyer. Factual Situation: A intends to sell his horse to B and says, ‘My horse is perfectly sound’. A genuinely believes the horse to be sound, although he does not know that the horse has fallen ill yesterday. B there upon buys the horse. Issue: Is there misrepresentation on the part of A? Decision:

4. 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:

5. 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: There is an agreement between A and B for the purchase of a certain horse. But the horse is dead at the time of the contract. Issue: What is the nature of contract? Decision:

6. Legal Principle: The act of using influence on another and taking undue advantage of that person is called undue influence. Factual Situation: A, is in dire need of money, so sells his newly purchased car worth 3 Lac for 50,000. Later on, he wants to set aside the contract on the ground of inadequacy of consideration? Issue: Can he do so? Decision:

7. Legal Principle: A right of action cannot arise out of an illegal activity. Factual Situation: X borrows 50,000 from Y for the purpose of smuggling goods. Y knows of the purpose of the loan. Issue: Is this agreement valid? Decision:

8. Legal Principle: The act of using influence on another and taking undue advantage of that person is called undue influence. Factual Situation: An illiterate woman executed a deed under the impression, that she was executing a deed authorizing her nephew to manage her lands, while in fact it was a deed of gift in favor of her nephew. The evidence showed that the woman never intended to execute such a deed of gift nor was the deed read or explained to her. Issue: Is the deed valid and is operative? Decision:

9. 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:

10. Legal Principle: Agreements purely social and domestic in nature are not enforceable at law. Factual Situation: A invites B to dinner. B accepts the invitation but does not turn up at the dinner. Issue: Can A sue B for the loss he has suffered? Decision:

11. Legal Principle:
1. The act of using influence on another and taking undue advantage of that person is called undue influence.
2. In order to prove undue influence, there has to be a pre-existing relationship between the parties to a contract. The relationship has to be of such a nature that one is in a position to influence the other. If it is proven that there has been undue influence, the party who has been so influenced need not enforce the contract or perform his obligations under the contract. Factual Situation: After a Vakil had accepted the case and the signed the Vakalatnama, the client says. ‘If you do your utmost to win the case, I will give you 1000 more’. The case is won. Issue: Can the Vakil claim 1,000? Decision:

12. Legal Principle: ‘An auction/bid is an invitation to offer not an offer. It does not bind the auctioneer.’ Factual Situation: A, an auctioneer gives advertisement in the newspaper wherein he mentions that certain furniture would be sold at Jaipur on a certain day. Mr B. a propective buyer of Delhi, on reading the advertisement reaches Jaipur on the fixed date. But the auctioneer cancels the auction sale. Issue: Can B sue A, for not conducting the auction sale and can he claim damages for loss of his time and expenses? Decision:

13. Legal Principle: Communication of acceptance is must for valid contract. Factual Situation: The manager of a railway company received an offer by a letter relating to the supply of coal; he wrote on the letter ‘accepted’ and kept it in his drawer and forget all about it. Issue: What is the nature of contract? Decision:

14. 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: A and B are friends. B treats A during A’s illness. B does not accept payment from A for the treatment and A promises B’s son X to pay him 1,000. A being in poor circumstances in unable to pay. X sues A for the money. Issue: Can X recover? Decision:

15. 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 paid B, a public servant a certain amount inducing him to retire from service, thus paving the way for A to be appointed in his place. Issue: Is the agreement valid? Decision:

16. 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:

17. 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: D offered to purchase a lodge owned by P for 6,000. He wrote to P’s agent asking whether his offer was accepted. He also added that he was ready to accept any higher price if found reasonable. The agent replied, ‘would not accept less than 10,000’. D accepted this and brought a suit for specific performance. Issue: Is P liable for specific performance? Decision:

18. 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: As a minor borrowed 20,000 from B and as a security for the same executed a mortgage in his favor. He became a major a few months later and filed a suit for declaration that the mortgage executed by him during his minority was void and should be cancelled. Issue: Is the agreement void or valid? Decision:

19. Legal Principle: A right of action cannot arise out of an illegal activity. Factual Situation: A promise to obtain for B an employment in the public service and B promises to pay 1,000 to A. Issue: What is the nature of contract? Decision:

20. Legal Principle: Every agreement by which anyone is restrained from exercising a lawful profession, trade or business of any kind, to that extent is void. Factual Situation: A promised to marry none else except Miss B, and in default to pay her a sum of 2,000. Miss B sued A for the recovery of that sum on the ground that A married someone else. Issue: What is the nature of the agreement? Decision:

21. Legal Principle: The act of using influence on another and taking undue advantage of that person is called undue influence. Factual Situation: A, a police officer purchased a property worth 2 lac for 20,000 from B, an accused under his custody. But later on B wants to cancel the sale on the ground of undue influence. Issue: Is the contract of sale is valid? Decision:

22. 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:

23. 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:

24. 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:

25. 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: X gives to Y 300 to be given to Z. Y informs Z that he is holding the money for him. But afterwards Y refuses to pay the money. Z sues Y for the money. Y contends that Z cannot sue as he was not a party to the contract. Issue: Will the contention of Y be upheld? Decision: