A contract is an agreement entered into voluntarily by two parties or more with the intention of creating a legal obligation “. Explain and evaluate the statements in the parlance of Law of Contract.
INTRODUCTION
CONTRACT
A contract is an agreement entered into voluntarily by two parties or more with the intention of creating a legal obligation, which may have elements in writing, though contracts can be made orally. The remedy for breach of contract can be “damages” or compensation of money. In equity, the remedy can be specific performance of the contract or an injunction. Both of these remedies award the party at loss the “benefit of the bargain” or expectation damages, which are greater than mere reliance damages, as in promissory estoppel. The parties may be natural persons or juristic persons. A contract is a legally enforceable promise or undertaking that something will or will not occur. The word promise can be used as a legal synonym for contract.[1] Although care is required as a promise may not have the full standing of a contract, as when it is an agreement without consideration.
Contract law varies greatly from one jurisdiction to another, including differences in common law compared to civil law, the impact of received law, particularly from England in common law countries, and of law codified in regional legislation. Regarding Australian Contract Law for example, there are 40 relevant acts which impact on the interpretation of contract at the Commonwealth (Federal / national) level, and an additional 26 acts at the level of the state of NSW. In addition there are 6 international instruments or conventions which are applicable for international dealings, such as the United Nations Convention on Contracts for the International Sale of Goods (Vienna Sales Convention)
Origin and scope
Contract law is based on the principle expressed in the Latin phrase pacta sunt servanda, which is usually translated “agreements must be kept” but more literally means “pacts must be kept”.
As a means of economic ordering, contract relies on the notion of consensual exchange and has been extensively discussed in broader economic, sociological, and anthropological terms (see “Contractual theory” below). In American English, the term extends beyond the legal meaning to encompass a broader category of agreements.
This article mainly concerns the common law. Such jurisdictions usually retain a high degree of freedom of contract, with parties largely at liberty to set their own terms. This is in contrast to the civil law, which typically applies certain overarching principles to disputes arising out of contract, as in the French Civil Code.
However, contract is a form of economic ordering common throughout the world, and different rules apply in jurisdictions applying civil law (derived from Roman law principles), Islamic law, socialist legal systems, and customary or local law.
Elements
At common law, the elements of a contract are offer, acceptance, intention to create legal relations, and consideration.
Offer and Acceptance
The most important feature of a contract is that one party makes an offer for an arrangement that another accepts. This can be called a concurrence of wills or consensus ad idem (meeting of the minds) of two or more parties. The concept is somewhat contested. The obvious objection is that a court cannot read minds and the existence or otherwise of agreement is judged objectively, with only limited room for questioning subjective intention: see Smith v. Hughes. Richard Austen-Baker has suggested that the perpetuation of the idea of ‘meeting of minds’ may come from a misunderstanding of the Latin term ‘consensus ad idem’, which actually means ‘agreement to the [same] thing’. There must be evidence that the parties had each, from an objective perspective, engaged in conduct manifesting their assent, and a contract will be formed when the parties have met such a requirement.
The case of Carlill v Carbolic Smoke Ball Company is an example of a ‘unilateral contract’. The term unilateral contract is used in contract law although ultimately there is an offerer and an offeree and a consideration (which may be an act), and in Australian Mills v The Commonwealth, the High Court of Australia considered the term “unscientific and misleading”. Obligations are only imposed upon one party upon acceptance by performance of a condition.[2]
Offer and acceptance does not always need to be expressed orally or in writing. An implied contract is one in which some of the terms are not expressed in words. This can take two forms. A contract which is implied in fact is one in which the circumstances imply that parties have reached an agreement even though they have not done so expressly. For example, by going to a doctor for a checkup, a patient agrees that he will pay a fair price for the service. If one refuses to pay after being examined, the patient has breached a contract implied in fact. A contract which is implied in law is also called a quasi-contract, because it is not in fact a contract; rather, it is a means for the courts to remedy situations in which one party would be unjustly enriched were he or she not required to compensate the other. For example, a plumber accidentally installs a sprinkler system in the lawn of the wrong house. The owner of the house had learned the previous day that his neighbor was getting new sprinklers. That morning, he sees the plumber installing them in his lawn. Pleased at the mistake, he says nothing, and then refuses to pay when the plumber delivers the bill. Will the man be held liable for payment? Yes, if it could be proven that the man knew that the sprinklers were being installed mistakenly, the court would make him pay because of a quasi-contract. If that knowledge could not be proven, he would not be liable. Such a claim is also referred to as “quantum meruit”.
Consideration
Consideration is something of value given by a promissor to a promisee in exchange for something of value given by a promisee to a promissor. Typically, the thing of value is a payment, although it may be an act, or forbearance to act, when one is privileged to do so, such as an adult refraining from smoking.
Consideration consists of a legal detriment and a bargain. A legal detriment is a promise to do something or refrain from doing something that you have the legal right to do, or voluntarily doing or refraining from doing something, in the context of an agreement.[3] A bargain is something the promisor (the party making promise or offer) wants, usually being one of the legal detriments. The legal detriment and bargain principles come together in consideration and create an exchange relationship, where both parties agree to exchange something that the other wishes to have.
The purpose of consideration is to ensure that there is a present bargain, that the promises of the parties are reciprocally induced. The classic theory of consideration required that a promise be of detriment to the promissor or benefit to the promisee. This is no longer the case in the USA; typically, courts will look to a bargained-for exchange, rather than making inquiries into whether an individual was subject to a detriment or not. The emphasis is on the bargaining process, not an inquiry into the relative value of consideration. This principle was articulated in Hamer v. Sidway. Yet in cases of ambiguity, courts will occasionally turn to the common law benefit/detriment analysis to aid in the determination of the enforceability of a contract.
A. Sufficiency
Consideration must be sufficient, but courts will not weight the adequacy of consideration. For instance, agreeing to sell a car for a penny may constitute a binding contract. All that must be shown is that the seller actually wanted the penny. This is known as the peppercorn rule. Otherwise, the penny would constitute nominal consideration, which is insufficient. Parties may do this for tax purposes, attempting to disguise gift transactions as contracts.[4]
Transfer of money is typically recognized as an example of sufficient consideration, but in some cases it will not suffice, for example, when one party agrees to make partial payment of a debt in exchange for being released from the full amount.
Past consideration is not sufficient. Indeed, it is an oxymoron. For instance, in Eastwood v. Kenyon, the guardian of a young girl obtained a loan to educate the girl and to improve her marriage prospects. After her marriage, her husband promised to pay off the loan. It was held that the guardian could not enforce the promise because taking out the loan to raise and educate the girl was past consideration—it was completed before the husband promised to repay it.
The insufficiency of past consideration is related to the preexisting duty rule. The classic instance is Stilk v. Myrick, in which a captain’s promise to divide the wages of two deserters among the remaining crew if they would sail home from the Baltic short-handed, was found unenforceable on the grounds that the crew were already contracted to sail the ship through all perils of the sea.
The preexisting duty rule also extends beyond an underlying contract. It would not constitute sufficient consideration for a party to promise to refrain from committing a tort or crime, for example. However, a promise from A to do something for B if B will perform a contractual obligation B owes to C, will be enforceable – B is suffering a legal detriment by making his performance of his contract with A effectively enforceable by C as well as by A.
Consideration must move from the promisee. For instance, it is good consideration for person A to pay person C in return for services rendered by person B. If there are joint promisees, then consideration need only to move from one of the promisees.
Formation
In addition to the elements of a contract:
- a party must have capacity to contract;
- the purpose of the contract must be lawful;
- the form of the contract must be legal;
- the parties must intend to create a legal relationship; and
- the parties must consent.
As a result, there are a variety of affirmative defenses that a party may assert to avoid his obligation.
Freedom of contract
Right of an adult to make a legally binding mutual agreement with one or more other persons, without governmental interference as to what type of obligations he or she can take upon himself or herself.
The contract clause, found in Article I, section 10 of the Constitution, prohibits the states from impairing the obligations of contracts.[5] This clause had the potential to be the foundation of a general right to freedom of contract, but the Supreme Court held in Ogden v. Saunders, 25 U.S. 213 (1827), that the clause applies only to retroactive impairments of existing contracts, not to general police power regulation that affects future contracts.
Starting in the New Deal period, the Supreme Court further restricted the scope of the clause, and today it is rarely invoked to limit states’ interference with contracts.
A. Early Court Interpretation
While the contract clause never fulfilled its potential of protecting a general right to freedom of contract, by the late nineteenth century American courts began to assert that a right to contract free from unreasonable government regulations is protected by the due process clause of the Fourteenth Amendment. The first indications that the Supreme Court might be sympathetic to such a right are found in the dissents in the Slaughter-house Cases, 83 U.S. 36 (1873), by Justices Joseph Bradley and Stephen Field. Both dissents argued that the Fourteenth Amendment protects the right to pursue an occupation free from unreasonable government interference. Dissenting in Powell v. Pennsylvania, 127 U.S. 678 (1888), Field argued that the liberty protected by the due process clause includes “the right of man to be free in the enjoyment of the faculties with which he has been endowed by his Creator, subject only to such restraints as are necessary for the common welfare
Justice Rufus Peckham (1809–1873), writing for the Court in Allgeyer, favorably cited Bradley’s dissent in Slaughter-house. He also quoted Justice John Marshall Harlan’s majority opinion in Powell. Though Powell upheld restrictions on the sale of margarine, Harlan recognized a Fourteenth Amendment right to “enjoyment upon terms of equality with all others in similar circumstances of the privilege of pursuing an ordinary calling or trade, and of acquiring, holding and selling property, as an essential part of [the] rights of liberty and property.” Neither of these previous opinions had suggested that the Constitution protects a general right to liberty of contract, but Peckham’s opinion in Allgeyer firmly established liberty of contract as a right protected by the Fourteenth Amendment’s due process clause.
However, just a year later, in Holden v. Hardy, 169 U.S. 366 (1898), a seven-to-two majority of the Court placed significant restrictions on the scope of the liberty of contract
doctrine. In the process of upholding a maximum hours law that applied only to underground miners, the Court declared that reasonable health or safety measures were within the states’ police powers, even if they interfered with freedom of contract. The Court also suggested that it should generally defer to the state’s view that it is operating within its police power. A series of Court decisions upholding various labor regulations followed, with only Justices Brewer and Peckham regularly dissenting.
Much to almost everyone’s surprise, a five-to-four majority of the Court applied the liberty of contract doctrine to invalidate a New York maximum hours law for bakers in the notorious case of Lochner v. New York, 198 U.S. 45 (1905). In an opinion by Justice Peckham, the Court held that in the absence of evidence that the hours law protected public health, or that baking (like mining in Holden) was an especially unhealthful field in need of specific regulation, the law was an unjustified interference with liberty of contract. In dissent Justice Harlan, writing for himself and two others, agreed that the Constitution protected liberty of contract. He argued, however, that the hour’s law was a valid police power measure. Only Justice Oliver W. Holmes’s famous lone dissent rejected the liberty of contract doctrine.
Labor activists and Progressive legal scholars were outraged by Lochner. They accused the Court of serving as a tool of capital and of engaging in mechanical jurisprudence. With justification, many early Lochner critics noted the Court had turned the traditional Anglo-American hostility to monopoly power, as expressed in the Slaughter-house dissents, into the much broader doctrine of liberty of contract.[6]
Despite all of this ferment, for almost two decades Lochner turned out to be an aberration, with Holden’s apparently more liberal interpretation of the scope of the police power holding sway. That’s not to say that the Court never held that laws violated the right to liberty of Contract The most controversial issue of the day, however, was the status of labor reform, and at least through the early 1920s the Court rarely interfered with labor or health regulations claimed to be within the states’s police power. In the decade after Lochner, the Court upheld almost every state labor reform law that came before it, including laws banning child labor; regulating the hours of labor of women employees; making mining companies liable for their willful failure to furnish a reasonably safe place for workers; mandating an eight-hour day for federal workers or employees of federal contractors; and many others. By 1917, the liberty of contract doctrine seemed virtually moribund. The Court upheld four very controversial labor reforms: workers’ compensation laws, a federal law that not only limited railroad workers to an eight-hour day but also fixed wages at the level the workers had received when working longer hours, a minimum wage law for women, and a maximum hours law for all industrial workers.
A. Resurgence
Liberty of contract, however, underwent a surprising renaissance in the 1920s, after President Warren Harding (1865–1923) appointed four new conservative justices to the Court, led by Chief Justice William Howard Taft. Instead of continuing to rule case by case, the Court formalized and froze various doctrinal exceptions to liberty of contract, such as the government’s virtual carte blanche to regulate businesses “affected with a public interest.” Munn v. Illinois, 94
U.S. 113 (1876). These exceptions left a reasonably broad scope for liberty of contract.
In Adkins v. Children’s Hospital, 261 U.S. 525 (1923), a five-to-three majority of the Court invalidated a minimum wage law for women. The Adkins Court announced that “freedom of contract is…the general rule and restraint the exception; and the exercise of legislative authority to abridge it can be justified only by the existence of exceptional circumstances
The Court acknowledged that government regulation could be used for traditional police power purposes. Beyond that, the Court asserted that precedent limited interference with liberty of contract in the labor context to cases involving the following issues:
(1) “those dealing with statutes fixing rates and charges to be exacted by businesses impressed with a public interest.”
(2) “statutes relating to contracts for the performance of public work.”
(3) “statutes prescribing the character, methods and time for payment of wages
(4) “statutes fixing hours of labor” to preserve the health and safety for workers or the
Public at large.
Thus, during the Taft Court era the exceptions to liberty of contract created by prior Court decisions were retained, but they were categorized and applied narrowly to prevent what the Court saw as further erosion of individual liberty.[7]
It was only after Adkins that Lochner’s vigorous protection of freedom of contract was no longer an anomaly. The next decade or so marked the Court’s most aggressive consistent enforcement of freedom of contract. The Court, for example, invalidated a law regulating the size of bread loaves (Jay Burns Baking v. Bryan, 264 U.S. 504 [1924]), and a law establishing an ice monopoly in Oklahoma (New State Ice v. Liebmann, 285 U.S. 262 [1932]). The Court also expanded its protection of liberty of contract to include private school attendance (Pierce v.
Society of Sisters, 268 U.S. 510 [1925]), and foreign language instruction (Meyer v. Nebraska, 262 U.S. 390 [1923]), threatened by nativist legislation. Even so, the Court upheld most of the laws that came before it, including such far-reaching interferences with freedom of contract as exclusionary zoning (Euclid v. Ambler Realty, 272 U.S. 365 [1926]), and broad regulation of the railroad labor market (Texas & New Orleans Railroad v. Brotherhood of Railway and Steamship Clerks, 281 U.S. 548 [1930]).
Meanwhile, the Court’s liberty of contract jurisprudence rested on a tenuous intellectual foundation. By the 1920s libertarian views, especially on economics, had already been marginalized among American intellectuals and retained only a vestigial foothold among traditionalist elements in the legal community. The Great Depression eroded remaining support for liberty of contract. The Supreme Court’s commitment to private ordering in the economic sphere seemed outlandishly reactionary and insensitive to much of the public. The Court’s implicit belief that libertarian presumptions were fundamental to Anglo-American liberty and that liberty of contract was thus protected by the due process clause became untenable as the Depression wore on, with many Americans blaming the purported laissez-faire policies of previous administrations for the continuing economic crisis.
B. Shift on the Court
Despite the shift in the intellectual tides, the Court’s advocates of liberty of contract held fast to their views, and Court doctrine shifted only with changes in personnel. True to his essentially Progressive Republican nature, President Herbert Hoover (1874–1964) appointed three skeptics of freedom of contract to the Court—Justices Charles E. Hughes, Owen Roberts (1875–1955), and Benjamin N. Cardozo. By 1934, a majority had formed willing to broadly expand the “affected with a public interest” doctrine to the point where just about any regulation.
of prices was constitutional.[8] In that year, the Court upheld a New York law fixing the price of milk, defining “affected with a public interest” as meaning no more than “subject to the exercise of the police power,” which includes all businesses (Nebbia v. New York, 291 U.S. 502 [1934]).[9]
President Franklin D. Roosevelt shifted the center of gravity of the Court with a series of appointments, and the Court soon declared that economic legislation that allegedly violated freedom of contract was subject only to minimal constitutional scrutiny, to ensure that challenged legislation had a rational basis. Under this standard, the Court upheld a series of measures that would clearly have been unconstitutional under the prior regime, such as the National Labor Relations Act (United States v. Darby, 312 U.S. 100 [1941])
Sanctity of contract
Sanctity of Contract is a general idea that once parties duty enter into a contract, they must honor their obligations under the contract.[10] Whereas, efficient breach theory is that parties should feel free to breach a contact and damages, so long as this results are more economically efficient then performing under the contract.
A. Sanctity of contract and well defined property rights drive foreign investment
The key driver in President Good luck Jonathan’s transformation agenda is massive investment. This was why the ministries of Commerce and Industry were merged to form the Ministry of Trade and Investment. While it is important to seek to attract foreign direct investment into the country, creating the ministry is not bait for a foreign investor to want to come to Nigeria.
Globally, investors are interested in places where their return on investments is high. Nigeria certainly qualifies as investors have found out that they reap higher benefit if they invest in Nigeria. The few that have done so have found this to be true. Yet, Nigeria is not a haven to foreign investors.
There must be reasons why they shy away from Nigeria. Many investors out there who speak privately to Nigerians at investment fora are quick to point out that in Nigeria, there is no sanctity of contract and property rights are not clearly defined. Most foreign investors see this as the most inhibiting factor that scares away would-be investors.[11]
They are not worried about the lack of infrastructure as is always claimed by those who explain away the Nigeria situation. Shell, Mobil, Chevron, MTN, UACN and others know too well the infrastructural deficiency in the country; yet, they invested and are reaping the benefits.
The truth is that both local and foreign investors are wary of investing in Nigeria because the state and its agents have no respect for property rights and sanctity of contract. They are worried that if they invest in Nigeria, their investment can be taken over by the state. CBN Governor has said that the CBN is to protect depositors only and has no business with investors. It was little wonder that despite the grand-standing of the CBN to sell rescued banks to foreign investors, none showed up.
Sanctity of Contract is a general idea that once parties duly enter into a contract, they must honour their obligations under that contract. The sanctity of a contract in Nigeria has been rendered useless because the law and the judiciary have acceded to the various in- roads taking away its holiness.
Contracts have been breached with impunity by federal and state agents and servants who out rightly disregard and disobey court orders. Bi-Courtney Aviation Service Limited and Maevis Nigeria Limited are two examples of the major concessionaires in the aviation sector with complaints on breach of contracts.
The two companies have said the Federal Airports Authority of Nigeria (FAAN) is to be blamed for the confusion and controversy that have trailed their concession pacts. Fagbemi who manages Maevis said: “We are here under what you will refer to as PPP project in which we deploy assets that are required to keep the operations of FAAN at internationally acceptable standard.”
Justice Binta Murtala Nyako of the Federal High Court in Lagos had ruled that Federal Airports Authority of Nigeria (FAAN) has no right to terminate Maevis’ Airport Operations Management Services (AOMS) contract. The judge had in an order of December 17, 2010 referred parties in the conflict to arbitration, since the agreement between them provided for it in the event of a dispute.
The management of Maevis had approached the court for relief then, when it complained that its rights as contained in the agreement document were being infringed upon. Maevis has an agreement with FAAN to provide the airport operations management system.[12] The agreement was entered into in October 2007 by both parties under the PPP arrangement which would last for 10 years.
In a twist to the conflict after the initial ruling, FAAN had in a letter dated March 24, 2011 served a two-month termination notice to Maevis. On receipt of the termination notice, Maevis headed to the court for relief, claiming that the purported termination letter was a clear disregard for the High Court ruling.
Reacting to the issue of lack of sanctity of contract in Nigeria, Central Bank Governor, Sanusi Lamido Sanusi, described the lifting of the ban on tooth picks and furniture early in the year as a breach of contract stressing that it portends lack of credibility on the side of government. Sanusi said the CBN saw no urgency in that policy and wondered why it should be reversed without warning.
The Central Bank governor who was briefing members of the Monetary Policy Committee of the CBN on why banks were not usually disposed to lending to the real sector given current efforts being made to de-risk the industry and get banks to lend to the real economy, said: “This was because, a bank would only lend if it was satisfied with the risk criteria.
Investors anywhere in the world look for an environment where there is certainty, enduring economic policies and standard rules that are not changed overnight as in Nigeria and where they can perm the risk associated in a given project or investment.
Normally, before any foreign investor commits his capital into a project, he will want to be assured that there shall be stability in the investment regime. That is to say, the whole or key aspects of the agreement will be respected by the host state and that the rules of the game will not be changed unilaterally.
The foreign investor needs such an assurance not only as a means of ensuring that he realises the expected benefits for his shareholders, but also to convince other sponsors of the project that the project will generate enough capital to pay off their loans and meet their supply requirements.
These objectives may only be realised if the terms of the investment agreement are respected by the host state. Hence, for that reason, the principle of sanctity of contract is regarded as one of the most important legal concepts in the investment process.
The concept of sanctity of contract is based on the 19th Century classical contract theory which is founded in the Aristotelian virtue of promise- keeping, and liberality. According to the theory, a contract is an expression of the parties’ free will or choice. It is an exercise of the parties’ freedom and autonomy; as such, it should be honoured and not be interfered with by the court.
The terms of the contract must be implemented to the letter no matter how onerous or burdensome they may prove to be. The individual is the best judge of his own interest and if he strikes a bad deal then he should blame himself and bear the risk. It is neither the duty of the court nor that of the state to inquire into the fairness or otherwise of the contract; their role is to enforce what the parties have agreed to do. After all, enforcing contracts enhances economic efficiency.
The Federal Military Government in 1978 promulgated the Land Use Act in which it delegated authority over land allocation to the 36 states and their local governments in an effort to ensure that rural and urban populations had access and secure tenure to land.[13] While the physical land area is under the control of state governments, the minerals contained in such land belongs to the Federal Government in the Mineral Act.
While a corporate body or individual seeking land for investment goes to the state to obtain certificate of occupancy, he has to obtain mining lease licence from the Federal Government. It is this confused and lack of defined property rights that have resulted in the contention between the Federal Government and the states as to who owns what.
Enforcing individual right to property in the Nigeria courts in time of dispute is tortuous, time wasting as it takes years to get judgments, and costly. In most cases, federal agencies without due process, encroaches on individual property rights. The nationalisation of three Nigerian banks recently is a case in point.
The sacking of bank chiefs without due process of law is still fresh in the minds of Nigerians. What about the removal of the Nigerian Stock Exchange Director-General without due process? The concessionaire contracted by the Nigerian Airports Authority, Meavis, is another case where civil servants want to have their way against the term of engagement.
The Lekki road concession is yet another. While the company has built the road for it to commence tolling the road, the right of ownership arose and the contract is being frustrated. The fact that this government wants investment in infrastructure on the basis of Public-Private Partnership makes its illusory.
B. Sanctity of Contract Breached on Mortgages
According to the New York Times, an audit by San Francisco county officials of about 400 foreclosures “determined that almost all involved either legal violations or suspicious documentation. . . . The improprieties range from the basic — a failure to warn borrowers that they were in default on their loans as required by law — to the arcane. For example, transfers of many loans in the foreclosure files were made by entities that had no right to assign them and institutions took back properties in auctions even though they had not proved ownership. . . . About 84 percent of the files contained what appear to be clear violations of law, it said, and fully two-thirds had at least four violations or irregularities.”[14] The problem seems to be systemic, suggesting that judges should be able to modify mortgages on the basis of nullified contract.
The report came just after “the $26 billion settlement over foreclosure improprieties between five major banks and 49 state attorneys general.” As the San Francisco analysis points out, “the settlement does not resolve most of the issues this report identifies nor immunizes lenders and servicers from a host of potential liabilities.” Bankers have not been oblivious to the value of being protected, as banks require buyers to sign holding the institution harmless if questions arise about the validity of the foreclosure sale. In other words, the bankers have wanted to be able to rely on sanctity of contract even when they have violated the law of contract. Phil Ting, the San Francisco assessor-recorder, argues that the depth of the problem raises questions about whether at least some foreclosures should be considered void. “It is very apparent that the system is broken from many different vantage points.” For the banks to insist on sanctity of contract nonetheless should be rejected. The banks should be held accountable in spite of their signed forms of protection
Conclusion:
Right to freedom of expression and speech is our fundamental right. This is the fundamental right in most of the countries. But most of the people of Bangladesh are not aware about the right. For certain thing the right can be restricted like in the interests of the security of the State, friendly relations with foreign states, public order, decency or morality, or in relation to contempt of court, defamation or incitement to any offense. In the emergencies, it can also be restricted. From the above explanation we can easily conclude that, in a contract willingness of the all parties is required. Otherwise it will not be considered as any contract. To make a contract an offer or should place any offer to an offered and the offered willingly has to accept the offer. In the contract there should be a mutual consent between the parties otherwise the contract will not be a valid contract. Also it should be a lawful contract or the contract must not be contradictory with the state or region law. If the contract is not lawful then it will void the contract. The contract can be in any form, formal or casual, written or oral but must be regular and with a set of certain regular activities. Therefore, we can easily conclude with the statement that, a contract is a legal relationship between two or more people or parties who accept or refrain from doing certain act.
BIBLIOGRAPH
- Books:
· Commercial law(including company law) and Industrial law by Arun Kumar Sen and Jitendra kumar Mitra.
· Commercial law and Labour & Industrial law by M.AHAMMED
· Commercial law/Labor and Industrial Law. M.Ahammed
· Business law Titomas J.harron
2. Web:
· http://ssrn.com/abstract_id=1239749
· http://www.nytimes.com/2012/02/16/business/california-audit-finds-broad-irregularitiesin-foreclosures.html?_r=1&ref=todayspaper
· http://definitions.uslegal.com/f/freedom-of-contract/
· www.layersnjurists.com
[1] Willmott, L, Christensen, S, Butler, D, & Dixon, B 2009 Contract Law, Third Edition,page-3
[2] Hans Wehberg, Pacta Sunt Servanda, The American Journal of International Law, Vol. 53, No. 4 (Oct., 1959), p.775.;
[3] R. Austen-Baker, ‘Gilmore and the Strange Case of the Failure of Contract to Die After All’ (2002) 18 Journal of Contract Law 1,page-532
[4] Eastwood v. Kenyon (1840) 11, page- 438
[5] Eastwood v. Kenyon (1840) 11 page- 492
[6] Commercial law and Labour & Industrial law by M.AHAMMED,page -543
[7] Commercial law and Labour & Industrial law by M.AHAMMED,page -560
[8] Georgetown Law Journal 92(1):page-60
[9] Lochner Era Revisionism, Revised: Lochner and the Origins of Fundamental Rights Constitutionalism,page-320
[10] Trans-Lex.org Principle of Sanctity of contracts , (1870-71) page- 597
[11] Trans-Lex.org Principle of Sanctity of contracts , (1870-71) page- 632
[12] Commercial law(including company law) and Industrial law by Arun Kumar Sen and Jitendra kumar Mitra:page-533
[13] Commercial law(including company law) and Industrial law by Arun Kumar Sen and Jitendra kumar Mitra:page568
[14] Gretchen Morgenson, “Audit Uncovers Extensive Flaws in Foreclosures,” The New York Times, February 16, 2012.