Important Case Laws of Indian Contract Act

The Indian Contract Act, 1872 is a significant legislation that governs the law of contracts in India. The Act lays down the legal framework for forming and enforcing contracts between individuals and businesses. It is an essential law that every business owner and professional should be aware of. In this article, we will discuss some of the important case laws of the Indian Contract Act, 1872.

1. Balfour vs. Balfour

In this case, the husband promised to pay his wife maintenance while he was away in Ceylon. When the husband refused to pay the money, the wife sued him for breach of contract. The court held that the agreement between the husband and wife was a domestic agreement and not a contract. Therefore, it cannot be enforced by law.

2. Raffles vs. Wichelhaus

In this famous case, the parties entered into a contract for the sale of cotton to be shipped from Bombay to Liverpool. The buyer, however, did not specify which shipment he wanted, and there were two ships with the same name leaving at different times. The court held that since there was a mistake regarding the identity of the ship, there was no contract between the parties.

3. Mohori Bibee vs. Dharmodas Ghose

This case is important as it deals with the concept of undue influence. In this case, a minor entered into an agreement to mortgage his property to Dharmodas Ghose. The court held that since a minor is not competent to contract, the mortgage was void. The court also held that the mortgage was voidable due to undue influence as the minor was under the influence of his guardian.

4. Carlill vs. Carbolic Smoke Ball Company

In this case, the Carbolic Smoke Ball Company advertised that their product could prevent influenza, and they offered a reward of £100 to anyone who contracted the flu after using the smoke ball. A woman bought the product and contracted the flu. The company refused to pay the reward, and the woman sued for breach of contract. The court held that the advertisement was a unilateral offer, and the woman had accepted it by using the product. Therefore, the company was liable to pay the reward.

5. Mohd. Yunus vs. Mohd. Mustafa

In this case, the parties entered into an agreement for the sale of a shop. However, the seller did not disclose that the shop was under mortgage. The court held that the seller had fraudulently concealed the fact, and the buyer had the right to rescind the contract. The court also held that the seller was liable to pay compensation for the loss suffered by the buyer.

In conclusion, these case laws provide valuable insights into the Indian Contract Act, 1872. By understanding these landmark judgments, we can better comprehend the intricacies of the law and avoid legal disputes. So, it is essential for businesses and individuals to stay informed and seek legal advice whenever required.

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