“The law of Contracts is not the whole law of agreements nor is it the whole law of obligations”-Illustrate & explain
The law of Contracts is not the whole law of agreements nor is it the whole law of obligations. It is the law of those agreements which create obligations, and those obligations which have their source in agreements.” It is a belief that contract law only “enforces only those duties that a party has voluntarily assumed” Contract law has come to us from common law and it is said that it is an offspring of tort law. Contracts are supposed to be voluntarily. Both contracts and torts give rise to obligations. But tort obligations (i.e. the obligation to indemnify for your negligence are imposed by the law; it is not normally a choice one makes). Contracts, on the other hand, are a vehicle by which persons voluntarily create obligations upon themselves.
‘A contract is an agreement giving rise to obligations which are enforced or recognized by law it is “a voluntary obligation proceeding from a common intention arising from an offer and acceptance.” The factor which distinguishes contractual from other legal obligations is that they are based on the agreement of the contracting parties. Not all agreements are contracts. Only when an agreement gives rise to an obligation may it be called a contract. Hence, a contract is an agreement that is effective juridical, to give rise to a civil obligation. Contract is one of the sources of obligations. And once a civil obligation is formed, it is enforceable in court.
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.
Obligations are duties which are owed by one person to another. Corresponding to such duties are rights of the one to whom the duty is owed to ensure that the obligation is complied with. Thus, the class of individuals against whom an obligation may be enforced, and who indeed may enforce the obligation, is generally limited. For this reason, obligations are also referred to as ‘personal rights’.There is various ways in which an obligation may be created. However, all obligations may be broadly categorized in one of two ways. Thus, obligations may be classified as being either voluntary or involuntary, depending upon the method of their formation.
The law of obligations is one of the component private law elements of the civil system of law. It includes contract law, delict law, quasi-contract law, and quasi-delict law. Civil obligations are of different kinds according to the source from where they come from. Civil obligations bind under law and give a remedy
Sources of Civil Obligations
· Legislation: Created by the law
· Dilects and quasi-dilects: Created by damages
· Contracts and quasi-contracts can be classified as being either voluntary or involuntary.
Difference of Voluntarily and Involuntarily Civil obligation
The law of obligations is traditionally divided into two categories – contractual obligations, which are thought of as being entered into voluntarily and owed only to the parties contracting; and obligations in tort, which are owed to a larger class of people and thought of as being imposed by law.
In voluntarily obligations the parties to the obligation have exercised their will for its formation. Examples of voluntary obligations recognized by Scots law are that of contacts and promises. Alternatively, involuntary obligations do not consider the intentions of the parties, but are created by the operation of the law. Such obligations are also occasionally referred to as being obedient. Examples of this category include the laws of delict and tort law. The key distinction between tort and contract comes down to a question of consent. A contract is created as the product of two consenting parties, whereas a tort needs no consent and is typically issued by one party against another means in tort law we are getting obliged without our free consent hence it will not fall under contract law.
The Essential Elements of a Valid Contract
Section 10 of the Indian Contract Act, 1872 provides that “all agreements are contracts if they are made by the free consent of parties competent to contract, for a lawful consideration and with a lawful object, and are no thereby expressly declared to be void”.
An agreement becomes valid and enforceable by law when it fulfils certain conditions. These conditions, which may be called the Essential Elements of a Contract, are explained below.
· Offer and Acceptance: There must be a lawful offer by one part and a lawful acceptance of the offer by the other and acceptance must conform to the rules laid down in the Indian Contract Act regarding offer and acceptance.
· Intentions to create Legal Relationship: There must be an intention (among parties) that the agreement shall result in or create legal relations. An agreement to dine at a friend’s house is not an agreement intended to create legal relations and is not a contract. But an agreement to buy and sell goods or an agreement to marry, are agreements intended to create some legal relationship and are therefore contracts, provided the other essential elements are present.
· Lawful Consideration: Subject to certain exceptions, an agreement is legally enforceable only when each of the parties to it gives something and gets something. An agreement to do something for nothing is usually not enforceable by law. The something given or obtained is called consideration. The consideration may be an act (doing something) or forbearance (not doing something) or a promise to do or not to do something. Consideration may be past (something already done or not done). It may also be present or future. But only those considerations are valid which are “lawful”.
· Capacity of Parties: The parties to an agreement must be legally capable of entering into an agreement; otherwise it cannot be enforced by a court of law. Want of capacity arises from minority, lunacy, idiocy, drunkenness, and similar other factors. If any of the parties to the agreement suffers from any such disability, the agreement is not enforceable by law, except in some special cases.
· Free Consent: In order to be enforceable, an agreement must be based on the free consent of all the parties. There is absence of genuine consent if the agreement is induced by coercion, undue influence, mistake, misrepresentation, and fraud. A person guilty of coercion, undue influence etc. cannot enforce the agreement. The other party (the aggrieved party) can enforce it, subject to rules laid down in the Act.
· Legality of the Object: The object for which the agreement has been entered into must not be illegal or immortal or opposed to public policy.
· Certainty: The agreement must not be vague. It must be possible to ascertain the meaning of the agreement, for otherwise it cannot be enforced.
· Possibility of Performance: The agreement must be capable of being performed. A promise to do an impossible thing cannot be enforced.
· .Writing Registration and Legal Formalities: An oral contract is a perfectly good contract, except in those cases where writing and/or registration is required by some statute. In India writing and/or registration is required by some statute. In India writing is required in cases of lease, gift, sale and mortgage of immovable property: negotiable instruments; memorandum and articles of association of a company etc. Registration is compulsory in cases of documents coming within the purview of Section 17 of the Registration Act, e.g., mortgage deeds covering immovable property. The terms of an oral contract are sometimes difficult to prove. Therefore important agreements are usually entered into writing even in cases where wiring is not compulsory.
Relation between contract law and voluntarily obligation :
Contract is regarded as voluntary because we assume contractual obligations deliberately, by communicating an intention to bind ourselves.
There are some certain elements in law of contract which mainly enforces voluntarily civil obligation. They are:
· Free consent
· Intention to create legal relationship
Free Consent as Voluntarily obligation
Contracts not entered into voluntarily are voidable. There is an obvious natural affinity between the theory of contract law and the political theory on free consent. The basis of a contract is agreement, i.e., mutual consent. In other words, the parties should mean the something in the same sense and agree voluntarily. It is when there is consent, that the parties are said to be consensus ad idem i.e. their minds have met. Not only consent is required but it must be a free consent. Consent is considered valid, only when it is a free consent. Consent is not free when it has been caused by coercion, undue influence, misrepresentation, fraud or mistake. These elements if present, may vitiate the contract’ because here it is creating an involuntarily obligation Consent, in terms of voluntary choice, is – or, at least, appears to be or purports to be – at the essence of contract law. Contract law, both in principle and in practice, is about allowing parties to enter arrangements on terms they choose – each party imposing obligations on itself in return for obligations another party has placed upon itself. This freedom of contract- an ideal by which there are obligations to the extent, but only to the extent, freely chosen by the parties – is contrasted to the duties of criminal law and tort law, which bind all parties regardless of consent. All the free consent made is basically voluntarily obligations. This point shows that without free consent no contract is valid and hence because of free consent law of contract is restricting itself to voluntarily obligation.
Promise as Voluntarily Obligation
Contractual promises may be unusual compared to most other promises to the extent they sometimes allow the promisor to perform either by delivering a good or service or through compensation. But in the end, willfully assuming an obligation to another private person by communicating the intention to do so just is what we call promise. Whatever the substance of contractual obligations, their voluntary character normally derives from the same normative power invoked in promising generally.
Contractual obligation is voluntary, then, because contracts are (among other things) promises. Putting a commitment in contractual form usually (if not always) entails a promise, and because the very concept of promise implies the assumption of voluntary obligation, contractual obligation is voluntary just because it is an instance of promissory obligation.
Intention to create Legal relationship as voluntarily obligation
Before a promise or an agreement will create legal obligations, the promisor or the parties to the agreement must intend to enter into obligations which are to be legally binding. When no such intention exists, the promise or the agreement cannot be legally enforced. In English law it is clearly written To create a contract there must be a common intention of the parties to enter into legal obligations, mutually communicated expressly or impliedly. Hence it is implying a voluntary process because no one can force you to enter in to an obligation.
The requirement of ‘Intention to create legal relations’ constitutes one of the most significant conditions of a valid contract in many jurisdictions around the globe— both developed and developing. Rules or constitutions of voluntarily association do not constitute a binding legal contract between parties ‘unless there was some clear positive indication that the members contemplated the creation of legal relations inter se, the rules adopted for their governance would not be treated as amounting to an enforceable contract This shows that without a pure intention no one will enter a contract and it has to be a voluntarily process.
Rules or constitutions of voluntarily association do not constitute a binding legal contract between parties ‘unless there was some clear positive indication that the members contemplated the creation of legal relations inter se, the rules adopted for their governance would not be treated as amounting to an enforceable contract .
After conducting this research we can conclude that law of contract is voluntarily civil obligation. without being voluntarily or being at your own will, a contract can’t b valid There are certain factors which restricts law of contract to voluntarily obligation the main factor that i found is free of consent which restricts law of contract to voluntarily civil obligation.
5. http://edu.jenwiss.com/the-differences-and-similarities-between-rights-and-obligations-in-contract-and-tort/(difference between contract n tort law)
 no author “What agreements are contracts”(The Indian Contract Act 1872) available at http://www.vakilno1.com/bareacts/indiancontractact/s10.html
Brilmayer, Lea, “Consent, Contract and Territory” (1989). Faculty Scholarship Series. Paper 2541.