INTRODUCTION
·
One of the
essential requirements to form a contract is that it should not be void.
·
Section 10 of
the Indian Contract Act says, “All
agreements are contracts…that are not hereby expressly declared to be void”.
·
A contract can be
void due to several reasons,
For example:
1. It could be
an agreement to do an illegal act that is, it is void from the moment it was
first made.
2. It is against
the principles of justice and fairness or against public policy.
3. It becomes
subsequently void because of a change in the law.
4. It has
already been fully performed.
·
The last
essential of a valid contract as declared by Section 10 is that it must not be
one which is ‘expressly declared’ to be void by the Act.
· Thus, there arises a question, as to what are ‘expressly declared’ void agreements?
The following agreements have been ‘Expressly declared’, to be void by the Indian Contract Act:
·
Agreements in
restraint of marriage (Sec. 26).
·
Agreements in
restraint of trade (Sec. 27).
·
Agreements in
restraint of legal proceedings (Sec. 28).
· Agreements the meaning of which is uncertain (Sec. 29)
Agreements by way of wager (Sec. 30).
·
Agreements contingent on impossible events
(Sec. 36).
·
Agreements to do
impossible acts (Sec. 56).
Agreements in Restraint
of Marriage (Sec.26)
·
Sec.26
“Every agreement in restraint of the marriage of any person, other than minor,
is void.” Difference between a positive promise to marry a particular person and
but restrictive agreement containing a promise not to marry anybody else.
·
The law regards
marriage and married status as a fundamental right of every individual.
Therefore, any agreement that has the object of stopping a person from getting
married, or limiting him or her right in selecting a marriage partner is void
because it is against public policy.
AGREEMENTS
IN RESTRAINT OF A TRADE (SEC.27)
·
Sec.27 “Every
agreement by which anyone is restrained from exercising a lawful profession,
trade or business of any kind, is to that extent void.”
·
The law decrees
that an individual, be of any religion, cast or section should be at liberty to
work for himself and any agreement that deprives, or attempts to deprive, a
person of the fruit of his labour, skill or talent is a void agreement
AGREEMENTS
IN RESTRAINT OF LEGAL PROCEEDINGS (SEC.28)
·
“Every agreement, by which any party thereto
is restricted absolutely from enforcing his rights under or in respect of any
contract, by the usual legal proceedings in the ordinary tribunals,
·
Or which limits
the time within which he may thus enforce his rights, or which provides for
forfeiture of any rights arising from contract, if suit is not brought within a
specified time, is void to the extent.
AGREEMENTS THE MEANING
OF WHICH IS UNCERTAIN (SEC.29)
·
According to
Section 29, Agreements, the meaning of which is not certain, or capable of
being made certain, are void.
·
It is normal
that any agreement that does not clearly define the responsibilities of the
parties to it cannot be enforced. If such responsibilities are not clear and
cannot be clarified, the agreement is void.
Example: Amar agrees to purchase a horse from Akbar for ₹
20,000. He also agreed to pay 1,000 more, if the horse proved lucky. It was
held that the agreement was void. It was observed that the court had no
machinery to determine what luck horse had bought to the buyer.
AGREEMENTS BY WAY OF
WAGER (SEC. 30)
·
It is an
agreement under which money or money’s worth is payable by one person to
another on the happening or non-happening of future uncertain event.
·
A WAGER is a
game of chance in which winning or losing wholly depends on a specified
uncertain event.
·
It is an
agreement of betting. Wagering Agreements are those in which there is a promise
to pay money or money’s worth in the event of an uncertainty becoming a
certainty.
AGREEMENTS CONTINGENT ON IMPOSSIBLE EVENTS
(SEC. 36)
·
As per Section
36 in The Indian Contract Act, 1872 Agreements contingent on impossible
event void are Contingent agreements to do or not to do anything, if an
impossible event happens, are void, whether the impossibility of the event is
known or not to the parties to the agreement at the time when it is made.
Example: A agrees to pay B 1,000 rupees if two straight
lines should enclose a space. The agreement is void.
LEGAL FORMALITIES: WRITTEN AND REGISTERED
LEGAL FORMALITIES: WRITTEN AND REGISTERED
·
After the terms
of a contract have been defined and agreed upon, it is necessary that the
contract is written, testifies by a witness and witnesses if it is compulsory
to do so under the provision of law.
·
A contract can
be oral or written. From the legal standpoint, there is no difference between
the two.
NECESSITY
OF BEING WRITTEN
1. Negotiable instruments such as bills
of exchange, promissory notes, cheques etc.
2. Promise to pay time barred debts.
3. Transfer of shares in a joint stock
company.
4. Sale, mortgage, lease or gift of an
immovable property.
5. Memorandum or Article of association
of a company
NECESSITY OF
REGISTRATION
1. Contracts arising out of natural love
and affection between parties having near relationship, in the absence of
consideration.
2. Contracts about transfer of immovable
property under the transfer of property act 1882.
3. Debenture and mortgage under
Companies Act, 1956.
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