Judicial Services Exam (PCS-J) Law of Contract and Specific Relief Syllabus

Law of Contract and Specific Relief syllabus — full chapter and topic list

Expand any chapter to see its topics and sub-topics. This is the whole examinable outline for Law of Contract and Specific Relief in Judicial Services Exam (PCS-J), not a summary of it.

1. 1

   Formation of Contract

   5 topics

   • Offer and Acceptance
     • Communication, revocation and standing offers
     • Invitation to offer distinction
   • Consideration
     • Privity of contract and consideration
     • Exceptions to no consideration no contract
   • Capacity to Contract
     • Minor's agreements and consequences
     • Persons of unsound mind and disqualified persons
   • Free Consent
     • Coercion, undue influence, fraud, misrepresentation
     • Mistake of fact and law
   • Lawful Object, Consideration and Void Agreements
2. 2

   Performance, Discharge and Remedies

   4 topics

   • Contingent and Quasi Contracts
   • Performance of Contracts
   • Discharge of Contract
     • Discharge by performance, agreement and breach
     • Frustration and doctrine of impossibility - Section 56
   • Remedies for Breach
     • Damages - remoteness and measure
     • Liquidated damages and penalty
3. 3

   Special Contracts

   3 topics

   • Indemnity and Guarantee
     • Rights and liabilities of surety
     • Discharge of surety
   • Bailment and Pledge
   • Agency
     • Creation of agency and authority
     • Termination and ratification
4. 4

   Specific Relief and Allied Statutes

   4 topics

   • Recovery of Possession of Property
   • Specific Performance of Contracts
     • Contracts specifically enforceable
     • Persons for and against whom enforced
   • Rectification, Rescission and Cancellation of Instruments
   • Declaratory Decrees and Preventive Relief
     • Perpetual and mandatory injunctions

Law of Contract and Specific Relief flashcards for Judicial Services Exam (PCS-J)

21 of 57 cards from the Law of Contract and Specific Relief deck — real questions with worked answers.

1. Under Section 2(h) of the Indian Contract Act, 1872, what is a 'contract'?

   An agreement enforceable by law. (Contract = Agreement + Enforceability by law.)

2. Distinguish between an 'offer/proposal' [S.2(a)] and an 'invitation to offer'.

   A proposal is the expression of willingness to do or abstain from doing something to obtain another's assent. An invitation to offer (e.g., goods displayed in a shop, advertisements, auction notices) merely invites others to make offers; it is not itself an offer capable of acceptance.

3. What are the essential rules for a valid acceptance under the Indian Contract Act?

   Acceptance must be (1) absolute and unqualified [S.7], (2) communicated to the offeror, (3) in the prescribed/usual reasonable manner [S.7], (4) given while the offer subsists, and (5) by the person to whom the offer was made.

4. When is communication of a proposal, acceptance, and revocation 'complete' under Section 4?

   Proposal: complete when it comes to the knowledge of the offeree. Acceptance: complete as against the proposer when it is put in course of transmission (out of acceptor's power), and as against the acceptor when it comes to proposer's knowledge. Revocation: complete as against the maker when put in transmission, and against the receiver when it comes to his knowledge.

5. When may a proposal and an acceptance be revoked under Section 5?

   A proposal may be revoked any time before the communication of acceptance is complete as against the proposer, but not afterwards. An acceptance may be revoked any time before the communication of acceptance is complete as against the acceptor, but not afterwards.

6. What was the rule established in Carlill v. Carbolic Smoke Ball Co. regarding general offers?

   An offer made to the world at large (general offer) can be accepted by anyone who performs the conditions; performance of the conditions amounts to acceptance, and communication of acceptance is not necessary for unilateral offers conditioned on performance.

7. Define 'consideration' under Section 2(d) of the Indian Contract Act.

   When, at the desire of the promisor, the promisee or any other person has done or abstained from doing, or does or abstains from doing, or promises to do or abstain from doing, something, such act, abstinence or promise is called consideration for the promise.

8. What is the doctrine of privity of consideration, and how does Indian law differ from English law?

   Under English law consideration must move from the promisee. Under Indian law (S.2(d): 'the promisee or any other person'), consideration may move from a third party (a stranger to consideration can sue), as held in Chinnaya v. Ramayya. However, privity of contract (only parties to a contract can sue) is still applied in India.

9. State the general rule and the statutory exceptions where an agreement without consideration is valid (Section 25).

   General rule: an agreement without consideration is void. Exceptions: (1) written and registered agreement made out of natural love and affection between near relations; (2) promise to compensate for past voluntary services; (3) written promise to pay a time-barred debt. Also, a completed gift and a contract of agency (S.185) need no consideration.

10. Who is competent to contract under Section 11 of the Indian Contract Act?

    Every person who (1) is of the age of majority according to the law to which he is subject, (2) is of sound mind, and (3) is not disqualified from contracting by any law to which he is subject.

11. What is the legal effect of a minor's agreement, per Mohori Bibee v. Dharmodas Ghose?

    An agreement by a minor is void ab initio (absolutely void), not merely voidable. A minor can be a promisee/beneficiary but cannot be bound; the rule of estoppel does not apply against a minor, and the doctrine of restitution applies only in limited circumstances.

12. What is a person of 'sound mind' for the purpose of contracting under Section 12?

    A person is of sound mind if, at the time of making the contract, he is capable of understanding it and of forming a rational judgment as to its effect upon his interests. A usually unsound person may contract when of sound mind; a usually sound person cannot contract when of unsound mind.

13. Is a minor liable for 'necessaries' supplied to him, and on what basis?

    A minor is not personally liable on the contract, but under Section 68 the person who supplies necessaries suited to the minor's condition in life is entitled to reimbursement from the minor's property (quasi-contractual liability), not from the minor personally.

14. What constitutes 'free consent' under Section 14?

    Consent is free when it is not caused by (1) coercion (S.15), (2) undue influence (S.16), (3) fraud (S.17), (4) misrepresentation (S.18), or (5) mistake (Ss.20-22). Consent is when two or more persons agree upon the same thing in the same sense (consensus ad idem, S.13).

15. Define 'coercion' under Section 15.

    Coercion is committing or threatening to commit any act forbidden by the Indian Penal Code, or unlawfully detaining or threatening to detain any property, to the prejudice of any person, with the intention of causing him to enter into an agreement.

16. Define 'undue influence' under Section 16 and when a presumption of it arises.

    Undue influence exists where one party is in a position to dominate the will of another and uses that position to obtain an unfair advantage. A position to dominate is presumed where there is (a) real or apparent authority/fiduciary relation, or (b) where one party's mental capacity is affected by age, illness, or distress. The burden of proving the contract was not induced by undue influence lies on the dominating party.

17. Define 'fraud' under Section 17.

    Fraud means acts done by a party (or his agent/connivance) with intent to deceive or induce another to enter a contract, including: (1) suggestion of an untrue fact known to be untrue; (2) active concealment of a fact; (3) a promise made without intention of performing it; (4) any other deceptive act; (5) any act/omission specially declared fraudulent by law. Mere silence is generally not fraud unless there is a duty to speak or silence is equivalent to speech.

18. Define 'misrepresentation' under Section 18 and contrast it with fraud.

    Misrepresentation is an innocent/unintentional false statement of fact made in the belief it is true, a breach of duty without intent to deceive, or innocently causing a party to make a mistake about the subject. Unlike fraud, there is no intention to deceive; the misrepresentation must be of a material fact, and there are no damages (only rescission), whereas fraud allows both rescission and damages.

19. What is the effect on a contract when consent is caused by coercion, undue influence, fraud, or misrepresentation (Section 19/19A)?

    The contract is voidable at the option of the party whose consent was so caused. He may rescind it or insist on performance. (For undue influence, S.19A allows the court to set it aside absolutely or on such terms as it deems just.) A party who could discover the truth with ordinary diligence cannot avoid a contract on grounds of misrepresentation/silent-fraud.

20. Distinguish between a mistake of fact and a mistake of law under Sections 20-22.

    Bilateral mistake of fact essential to the agreement makes it void (S.20). Unilateral mistake of fact does not make a contract voidable (S.22). A mistake as to Indian law is no excuse and does not make a contract voidable (S.21); but a mistake as to a foreign law is treated as a mistake of fact.

21. Under Section 23, when is the consideration or object of an agreement unlawful?

    When it is (1) forbidden by law; (2) of such nature that, if permitted, it would defeat the provisions of any law; (3) fraudulent; (4) involves or implies injury to the person or property of another; or (5) the court regards it as immoral or opposed to public policy. In each case the agreement is void.

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