Contract Law Definition:
Basically, the definition of contract law is that it is an exchange of promises by two or more persons resulting in an obligation to do or refrain from doing a particular act, which obligation is recognized and enforced by law.
Meaning of Contract Law:
According to Black’s Law Dictionary:
Contract law means an agreement between two or more parties creating obligations that are enforceable or otherwise recognizable at law.
According to Merriam Webster Dictionary:
A contract in law is a binding agreement between two parties which is legally enforceable.
Sections 2(h), 10, 11, 14, 17 and 23 of the Contract Act,1872.
Contract Law Definitions:
According to Pollock:
“Every agreement and promise enforceable at law are a contract.
Salmond defines contract law as “A contract is an agreement creating and defining obligations between the parties”.
Under Section 2(h) of the Contract Act:
“An agreement enforceable by law is a contract”.
‘A’ agrees to sell his bicycle for Rs.3000 to ‘B’. It is a contract because the agreement between ‘A’ and ‘B’ is enforceable by law and the law treats their agreement for sale or buy the bicycle as valid.
Essentials of Contract Law:
In order to know the essentials of a valid contract, we have to look at Section 10 of the Contract Act,1872. It says, “All agreements are contracted IF they’re 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 void”.
Thus, keeping in view, the language of Section 10, we discuss its ingredients.
Offer/Proposal is the first basic element of Contract law. It is defined as “when a person who shows his intention or willingness to do or abstain to do certain things”. There must be the intention of the offeror.
Acceptance is the second element of Contract law. It is defined as “when a person to whom an offer/proposal is made and he gives his assent to thereto”.
Consideration is an essential element of a Contract law. It may be in past, present or future which need not be in cash or kind. Usually, a promise to given or to do something for nothing in return is not enforceable at law. For a valid contract, the consideration must be lawful.
4). Free consent:
For a valid contract, It is necessary that the consent of the parties to the contract must be free. According to Section 14 of the contract act, 1872 “consent is said to be free when it is not caused by;
a). Coercion under Section 15 of the Contract Act, 1872.
b). Undue influence under Section 15 and 19(A) of the Contract Act, 1872.
c). Fraud under Section 17 of the Contract Act, 1872.
d). Misrepresentation under Section 18 of the Contract Act, 1872.
e). Mistake under Section 20 and 22 of the Contract Act, 1872.
5). The Capacity of Parties:
It is essential that the parties to an agreement must be competent to contract; otherwise contract is not enforceable by law.
This concept of competency of parties has been defined under Section 11 of the Contract Act, 1872. It says, “Every person is competent to contract who is of the age of majority according to the law to which he is subject, and who is not disqualified from contracting by any law to which he is subject.”
6). Lawful Object:
By lawful object, we mean that subject matter upon which the contract is to be correct and lawful. And the object must be lawful.
7). The Certainty of Terms:
The Certainty of Terms is another essential element that the terms and conditions must be clear, complete, certain and must be understood not ambiguous. And it shall signify the true intention of the parties in the contract.
8). Not Expressly Declared Void:
in order to make a valid contract, it is necessary that an agreement must not have been declared void by any law in force in the country.
It is concluded that contract law definition is that it is an agreement which is enforceable by law. All contracts are agreements, but all agreements are not contracts. An agreement to be valid contract all the ingredients mentioned in Section 10 of the Contract Act,1872 must be there i.e. it must be entered in to with free consent, lawful consideration, object and not declared to be void under any law.