Each party to the agreement must benefit from the agreement

“Each party to the agreement must benefit from the agreement”. Discuss in reference to the law of contract.

Introduction:

We enter into contracts day after day. Taking a seat in a bus amounts to entering into a contract. When you put a coin in the slot of a weighing machine, we have entered into a contract. You go to a restaurant and take snacks; you have entered into a contract. In such cases, we do not even realize that we are making a contract. In the case of people engaged in trade, commerce and industry, they carry on business by entering into contracts. The law relating to contracts is to be found in the Indian Contract Act, 1872. The law of contracts differs from other branches of law in a very important respect. It does not lay down so many precise rights and duties which the law will protect and enforce; it contains rather a number of limiting principles, subject to which the parties may create rights and duties for themselves and the law will uphold those rights and duties.

What is Law?

Law is system of rules in a society which is differ from nation to nation and country to country for maintain and protect public and the property.

In broad sense we say that, Law is rules and regulation which is imposed by the government for their public and also him or her lead their life in a systematic way and smoothly running their state.

What is contract?

A contract is an agreement between two or more persons (individuals, businesses, organizations, or government agencies) to do, or to refrain from doing, a particular thing in exchange for something of value.

What is an agreement?

A contract is agreements voluntarily enter into two or more parties with the intension for creating a legal obligation which may be written or oral, but written contract more valid than the oral contact, that’s why all contract are form as a written.

What is a power conferring rule?

Primary rules are rules of conduct they tell us to what are our legally obligated to do and what consequences attach to obedience or disobedience. Thus, the criminal law rules that prohibit theft forbid certain conduct and provide for penalties for violating the prohibition. Technically, the class of secondary rules includes everything except primary rules. For example, secondary rules are legal rules that allow for the creation, extinction, and alteration of secondary rules secondary rules are known as power-conferring rules.

Title: How the laws of contract act or set of as power conferring rules by which individuals enter into an agreement?

The following features are considered to be essential to a contract:

  • A minimum of two parties must be needed
  • There has to be a lawful offer and acceptance which results in an agreement.
  • There must be intention between the parties to create a legal obligation.

· Consideration must pass:

Each party to the agreement must benefit from the agreement. Therefore, each party must give and get something. Consideration need not be immediate. It can be for something done in the past, present or future. In a contract, each party puts the other party under some obligation or extracts some promise from him or her. The exchange given for the obligation or promise is called consideration. It can be in cash or in kind.

· Lawful consideration:

Consideration must be lawful. That means the consideration given by one party to another should not be illegal, fraudulent, or opposed to public policy.

· Competent parties:

The parties to a contract must be competent to contract. For this they must be by 18 years old (must have attained majority).

· They must be of sound mind and should not be disqualified by law from entering into contracts. This means that, lunatics, drunkards, etc. cannot enter into a valid contract except in special cases. Sound mind means being able to make a rational decision as a normal person would be able to do. It also implies that one should not be in a state of intoxication in any manner.

· Free consent:

The parties to a contract must agree to enter into a contract freely. This means that they should not be coerced or be under any kind of undue influence, fraud, misrepresentation or mistake while entering into a contract. When consent is given it must specifically relate to the offer. When a person has the capacity to force another to do or not do something and the other person cannot resist that, the first person is said to have undue influence over the second.

· The parties cannot enter into a contract which has terms which are contrary to any law. This means that the contract cannot contain terms which are illegal, fraudulent, immoral or opposed to public policy.

· Not expressly declared void:

No law should clearly ban contract of that particular nature.

· Clarity of terms:

The terms of the agreement must be clear. If an agreement is unclear it cannot be enforced under law.

· Legal formalities to be complied with:

Contracts may be either oral or written. However, certain contracts have to be in writing while some contracts have to be written and registered. For example, a contract to sell property has to be written and registered.

Consideration must pass: Each party to the agreement must benefit from the agreement. Therefore, each party must give and get something. Consideration need not be immediate. It can be for something done in the past, present or future. In a contract, each party puts the other party under some obligation or extracts some promise from him or her. The exchange given for the obligation or promise is called consideration. It can be in cash or in kind.

· Lawful consideration:

Consideration must be lawful. That means the consideration given by one party to another should not be illegal, fraudulent, or opposed to public policy.

· The parties cannot enter into a contract which has terms which are contrary to any law. This means that the contract cannot contain terms which are illegal, fraudulent, immoral or opposed to public policy.

There are some another laws of contract which enable of an individual enter into an agreement by his or her own choice and also by his or her own condition. This law of contract given some freedom to individuals those are given below:

  1. Offer and acceptance:

For a contract should have an offer and acceptance. The law said only have offer and acceptance but not mention number of offer and when acceptance.

  1. Offeror and offeree:

There should have one person who offer and should have one or more person for accept the offer. The offer always not be for one person it may be for a group of person. In law said there must have offeror and offeree but mot mention that how much the person are. So offeror may be

  1. Be a contract there must have two or more parties enter into the contract:

In law said that there must have at least two more parties. There don’t actually a figure how much person attended into contract, it may be two or three or four or more parties. Here the individuals have their own choice enter into contract and if they want they can established some condition for contract like age of the person from 35 to 45. Or they must have male or female.

  1. Time of the contract:

In the contract there must be present the time when the contract form and what is the time for the contract.

The law told there must have valid time for the contract, the law not given specific time for the contract. Here individual have fully freedom or choice for set up time when the contract invalid.

  1. Intention to create legal relation:

Both parties have their intention to create legal relation. But for each contract don’t be needed or must not create legal relation. Like as when we purchase a pen from a shop there not need a relation but here one agreement was occurred, one person given money and one given product. So this type agreement not needs a legal relation. It is one kind of freedom a contract.

  1. Contract should have law consideration:

The agreement is considered by the law of that country or state.

Like as someone offer to others if you kill him or her I will give a ten lac taka. But in our constitution there clearly written if you kill someone you must be punished so contract should be valid by the consideration of law of that regional.

  1. Possibility performance:

The condition of the agreement should be possible.

Like as someone told another if you done it perfectly I will give the moon. So this type condition may be occurred but it is not a valid contract.

  1. Contract should be written, registration, and legal formalities:

For a strong and a valid contract the agreement should have document for proved the agreement. But there someone believes ones another in that time they are entering into an agreement without a written document. Their contract occurred by oral. The individual have to right made a contract oral. But when the agreement not complete the any one person cannot be go to court for the base oral contract because there have no legal document is the contract create or not. That time it is invalid contract.

If the contract based on a sale

Obligations of the Seller in case of sale of movables

1. Obligation to Deliver

Time and Place of delivery:

Time of Delivery: The seller should deliver the thing sold at agreed time. The time fixed by individual. And place also decided by individual. It is not mention in law.

Place of Delivery: unless otherwise agreed, the seller shall deliver the thing at the place where, at the time of the contract, he has his place of business or, failing such, his normal residence. On the other hand, where the sale relates to a specific thing and the parties know the place where such thing is at the time of the contract, the seller shall deliver the thing at such place.

2. Obligation to Transfer ownership

The seller shall take the necessary steps for transferring to the buyer unassailable rights of ownership over the thing. Ownership transfers upon transfer of possession. Possession transfers upon delivery. Thus, the necessary step to be taken by the seller to transfer ownership is to deliver the thing to the buyer in any of the modes of delivery discussed in the previous section. In the law there written ownership will be transfer but not mention when.

3. Obligation to warranty title, defects, and non conformity.

The seller shall take the necessary steps for transferring to the buyer unassailable rights over the thing.

(1) Provisions which exclude or restrict the warranty shall be construed restrictively;

(2) Unless otherwise expressly agreed, such provisions shall impose on the seller the obligation to return the price to the buyer, in whole or in part, in cases of dispossession; and

(3) A provision excluding or restricting the warranty shall be of no effect where the seller has intentionally concealed that a third party had a right on the thing or dispossession is due to the act of the seller.

Obligation of the Buyer

1. Obligation to pay price

a. The buyer shall pay the price and take delivery of the thing.

b. He shall be bound by any other obligation imposed upon him by the contract of sale

Place of payment: If no place is fixed in the contract, the buyer should pay the price at the address of the seller.

In law told that must be payment for the product. But not mention it is cash or cheque. It considered by that’s individual.

2. Obligation to take delivery of the thing

The buyer shall, after delivery, take such steps as may be necessary for completing the delivery of the thing. If there any condition present after the transaction then is must be fulfilled.

Common Obligations of the Seller and the Buyer

  1. The delivery cost:

After the transaction who pay the delivery cost. It beard by the seller or buyer it fixed by the individual.

  1. Damage by any accident:

Seller or buyer can made agreement if any damage occurred when transport one location to another damage by both it not mention law. The condition imposed by individual.

  1. Media for transportation:

By which transport occurred it chosen by the seller or buyer.

POWER-CONFERRING RULES:

The clearest indication that a law is concerned with the purpose with which it is satisfied is that it conditions its satisfaction on indicia of the actor’s legal purpose. Validity conditions that sort for legal purpose both express a legal expectation that the law will be used instrumentally and further enable such uses. Using the rules of contract law as an example, I distinguish four types of such validity conditions legal formalities; required no conventional legal speech acts; legal intent tests and nonlinguistic proxies for legal purpose. I argue both that the presence of such validity conditions indicates that the law’s sole function is to create a legal power and that the evidence that contract law includes them is equivocal at best. Legal consequences approximate to their non-legal and obvious consequences, as in making a contract. It also explains why most legal powers are exercised by acts with only negligible non-normative consequences, like signing, so that there are few reasons for or against doing them apart from their legal or other normative consequences.

For example:

KENT BACH & ROBERT M. HARNISH, LINGUISTIC COMMUNICATION AND

SPEECH ACTS 120–34 (1979), and P.F. Strawson, Intention and Convention in Speech Acts,

73 PHIL. REV. 439, 441 (1964).

49 Raz, supra note 15, at 81. Fuller described the same dynamic: “[F]orm offers a legal

framework into which the party may fit his actions, or, to change the figure, it offers channels

for the legally effective expression of intention.” Fuller, supra note 1, at 801. “Form

has an obvious relationship to the principle of private autonomy. Where men make laws

1744 NEW YORK UNIVERSITY LAW REVIEW [Vol. 83:1726

Conclusion:

At last law of contract is imposes to freely exercise the power. A person can easily make an agreement by power conferring rules. Through power conferring rules an individual can achieve the freedom to use the power. Element of contact, Element of agreement, law gives the right to freely exercise the power and make agreements that any one wants.

A judge’s final decision on a question of law which has been raised in a trial or a court hearing, particularly those issues which are vital to reaching a statement, These may be presented orally by the judge in open court, but are often contained in a written judgment in support of his/her judgment such as an award of damages or denial of a petition. In most cases either party is entitled to written conclusions of law if requested. a law’s only function is to give persons the ability to effect legal change, we should expect it to include validity conditions that sort for legal purposes. Basically it is known as power conferring rules for that anyone can include with an agreement and freely use the power.

The law is help to individual enter into an agreement by his or her own terms and condition. Not only that they can impose new condition or terms by consideration of law of contract of that state or country.

So would be a valid agreement follow the individuals rules of the

Bibliography

Books:

· Thomson J. Harron, Business law. Allyn and Bacon, Inc.1981.

Website

· http://en.wikipedia.org/wiki/Freedom_of_contract

· http://wiki.answers.com/Q/Sanctity_of_contract_mean

· http://definitions.uslegal.com/s/sanctity-of-contract/

· https://www.lawyersnjurists.com/

· http:/www.goggle.com

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