Chapter 3 Validity Of Contracts & Agreements Flashcards
What are essentials of valid contract?
1- Two persons.
2- Intention to create legal relationship.
3- Competence/Capacity of parties.
4- Free consent.
5- Consideration.
6- Lawful object.
7- Certainty.
8- Possibility of performance.
9- Legal formalities regarding writing & registration.
Which agreements must be written?
1- Agreement made on account of natural love and affection.
2- Promise to pay time barred debt.
3- Arbitration Agreements.
List down “types of contracts”.
1- Valid contract.
2- Void contract.
3- Voidable contract
What is difference between void agreements and void contracts ?
● Void agreements:
Agreements which are void from the start(void ab-initio).
● Void contracts:
Which is valid at start but subsequently something happened which made it void.
What is consideration?
When at desire of promisee, the promisor( or his agent on his behalf) has done, does, or promises to do something , such act is called consideration. Consideration either may be positive act or an abstinence.
List down “ essentials of consideration “.
1- Consideration must be offered at desire of promisee.
2- Consideration may be given by promisor or any other person.
3- Consideration may be past, present, or future act/abstinence.
4- Consideration must be something in value.
5- Consideration must be real.
6- Consideration must be something which promisor is not already bound to do.
7- Consideration must be Lawful.
List down exceptions to rule “ no Consideration, no contact “.
1- Agreement made on account of natural love and affection.
2- Agreement to compensate for past voluntary service.
3- Agreement to pay time-barred debt.
4- Completed gift.
5- Contribute to charity.
6- Other contacts ( contact of bailment, guarantee, and agency ).
List down “illegal agreements “?
1- Forbidden by Pakistan penal code i.e, punishable by law( wagering).
2- Injury to person or his property.
3- Fraudulent.
4- Defeat provision of any law.
5- Immoral or opposed to public policy.
List down “ agreements opposed to public policy “.
1- Trade with an alien enemy.
2- Stifling criminal prosecution.
3- Sale of public office.
4- Marriage brokerage agreements.
5- Restraint of parental rights.
6- Restraint of personal liberty.
7- Agreements to create monopoly.
What is position of agreement with minor?
1- Agreement by minor is void against him.
2- Rule of estoppel does not apply to minor.
3- No rectification of agreement by minor.
4- Minor cannot be partner in firm( he can be admitted to benefits).
5- Minor can be agent, but cannot be a principal in agency.
6- Agreement by guardian/parent of minor on his behalf for his benefits can be enforced against him.
7- In a contract by minor and adult jointly, minor’ll have no liability.
8- Minor cannot be insolvent.
9- Minor can sue but cannot be sued.
Write down status of agreement with specific person.
Agreement is always void against him.
What is status of agreement with lunatic?
● If lunatic was of unsound mind at time of agreement, then it’ll be void.
● If lunatic was of sound mind at time of contract, it’ll valid. However, party enforcing the contract will have to prove this.
What is status of agreement if basic necessaries are supplied to minor/unsound mind?
If basic necessaries are supplied to minor or his dependents, a reasonable price can be recovered from property of such minor/unsound mind.
Which persons are disqualified by law?
1- Alien enemy( citizen of country at war with Pakistan).
2- Foreign sovereign and ambassadors.
3- Convicts( found guilty or imprisoned ).
4- Insolvent.
What is status of agreement with insolvent?
If insolvent makes agreement with others, agreement will be void and it’ll be considered fraud by insolvent.
