Contract Law

A contract of sale can be execututory when obligations are yet to be performed, or executed when all obligations have been fulfilled. The contract type depends on the performance status of both parties.

Property in goods refers to ownership, not mere possession or custody. Possession is physical control, custody is temporary holding, but property (ownership) is the legal title.

Mutual agreement discharge can occur through novation (new contract replaces old), rescission (contract canceled), or alteration (terms modified). All are valid modes of discharge by mutual consent.

A void agreement is not enforceable in any court of law. It has no legal effect from the beginning, unlike voidable contracts which are valid until avoided by aggrieved party.

Rescission means cancellation of the contract, abrogating it from the beginning and restoring parties to their pre-contract position. It is distinct from modifying terms, accepting lesser performance (accord), or abandoning rights (waiver).

Under contract law, a proposal when accepted becomes a promise. For it to become a contract, consideration must also be present. The sequence is: proposal → acceptance → promise (+ consideration) → contract.

A person generally of sound mind lacks contractual capacity during moments of unsound mind. Contracts with minors are void (not voidable), minors' agreements cannot be ratified upon attaining majority, and a person usually of unsound mind CAN contract during lucid intervals.

Contracts are discharged upon proper performance of obligations by all parties. Performance is the primary mode of contract discharge, releasing parties from further obligations. The contract is not void (it was valid) or unenforceable; it is completed and terminated.

Collateral agreements to illegal agreements are void ab initio. Under contract law, when the main agreement is illegal, any transaction or agreement arising from or supporting it (collateral) is also tainted and unenforceable.

Under contract law, agreements without consideration are generally void ab initio (void from the beginning). Exceptions exist (natural love/affection, past consideration, etc.), but the general rule requires valuable consideration for enforceability.

Contracts with minors are generally void ab initio, but contracts beneficial to the minor (not requiring consideration from them) are valid and enforceable. The minor gets the benefit without being bound to perform obligations.

Free consent makes an agreement valid even if consideration is inadequate. Law requires consideration to exist and be lawful, but adequacy (fairness of amount) is for parties to decide. Courts don't intervene if consent was genuinely free.

A contingent contract is one where the performance is dependent on the happening or non-happening of a future uncertain event. This is explicitly defined under Section 31 of the Indian Contract Act, 1872.

Contracts to do an act that is impossible in itself are void under Section 23 of the Indian Contract Act. Bringing a star from the sky is physically impossible, making this agreement void ab initio.

A condition is a stipulation essential to the main purpose of the contract. Breach of condition gives the aggrieved party the right to treat the contract as repudiated and rescind it. In contrast, breach of warranty only gives right to claim damages but not to reject the goods.