REVISION SERIES OF CA FOUNDATION LAW LECTURE 1

• REVISION  SERIES OF CA FOUNDATION LAW
  1
• DR SHASHI AGGARWAL
• PROBLEMS 1 IN THE FORM OF CASE
• A AGREED TO SELL HIS HOUSW TO B FOR RS 5,000 SUBJECT TO CONTRACT. THE NEXT DAY C OFFERED A RS 6,000 FOR THE HOUSE AND A ACCEPTED THIS OFFER AND SOLD THE HOUSE TO C, CAN B SUE A FOR THE BREACH OF THE CONTRACT. WOULD IT MAKE ANY DIFFERENCE TO YOUR ANSWER IF THE AGREEMENT BETWEEN AND B WAS IN WRITING.
• SOLUTION
•  AN ORAL CONTRACT IS A PERFECTLY VALID CONTRACT EXCEPT IN THOSE CASES WHERE WRITING REGISTRATION IS REQUIRED BY SOME STATUTE.
• IN INDIA WRITING IS REQUIRED IN CASE OF SALE AND MORTGAGE,LEASE AND GIFT OF IMMOVABLE PROPERTY NEGOTIABLE INSTRUMENT,MEMORANDUM AND ARTICLES OF ASSOCIATION OF A COMPANY ETC. REGISTRATION IS REQUIRED IN CASE OF DOCUMENTS COMING WITH IN SCOPE OF SECTION 17 OF THE REGISTRATION ACT
• IF THIS AGREEMENT IN WRITING AND REGISTERED AND THEN B COULD SUE
• PROBLEM 2
• A ENGAGED B FOR DOING SOME WORK AND PROMISES TO PAY SUCH RUMENERATION AS SHALL BE FIXED BY THIRD PERSON C. B DOES THE WORK.” WHAT WILL B GET
• ANSWER: THERE IS CONTRACT BETWEEN A AND B
• A IS BOUND TO PAY THE RUMENERATION AS C SHALL FIX
• IF C DOES NOT FIX OR REFUSE TO FIX THE RUMENERATION THEN A IS BOUND TO PAY THE REASONABLE RUMENERATION.
• PROBLEM 3
• A AGREES TO MARRY B BUT B DIES BEFORE THE MARRIAGE TOOK PLACE. IS THIS A VOID AGREEMENT?
• IT IS NOT VOID AGREEMENT BUT VOID CONTRACT BECAUSE IT WAS ABSOLUTELY VALID WHEN ENTERED BUT LATER ON IT BECAMEVOID DUE TO THE DEATH OF B.

• PROBLEM 4
• A AGREES TO PAY RS 60,000 TO B IF B KILLS C. TO PAY B ,A BORROWS RS 60,000 FROM D WHO IS ALSO AWARE OF THE PURPOSE OF LOAN
• B KILLS C  BUT A REFUSES TO PAY AND A LSO REFUSE TO REPAY THE LOAN TO D.
• ANSWER:
• THE AGREEMENT BETWEEN A AND B IS AN ILLEGAL AGREEMENT BECAUSE ITS OBJECT SI UNLAW FUL SO B CAN NOT RECOVER ANY THING FROM A.
• SINCE MAIN AGREEMENT BETWEEN AND B IS ILLEGAL THE AGREEMENT BETWEEN A AND D IS COLLATERAL TO THE MAIN AGREEMENT IS ALSO VOID AND D CAN NOT RECOVER FROM A
• PROBLEM 5

1. AN AUCTIONEER ADVERTISED IN A NEWSPAPER THAT A SALE OF OFFICE FURNITURE WILL BE HELD AT BANGLORE
2. MAHESH A BROKER OF MUMBAI REACHED BANGLORE ON THE APOOINTED DAY AND TIME
3. BUT THE AUCTIONEER WITHDREW ALL THE OFFICE FURNITURE FROM THE AUCTION SALE.
4. THE BROKER SSUED FOR HIS LOSS OF TIME AND EXPENSES
5. WILL HE SUCCEED ?

• SOLUTION TO THE PROBLEM 5

1. IN SALE BY AUCTION GOODS ARE SOLD BY INVITING BIDS FROM BIDS FROM THE PROSPECTIVE BUYERS
2. THE BIDS ARE OFFERS AND INVITATION TO PEOPLE TO PARTICIAPTE IN AUCTION
3. SALE THROUGH ADVERTISEMENT IS NOT A PROPOSAL BUT MERELY AN INVITATION TO OFFER
4. BROKER WILL NOT SUCCEED IN CLAIMING COMPENSATION FOR LOSS OF TIME AND EXPENSES IN REACHING BANGALORE FOR ADVERTISED AUCTION SALE CANCELLED LATER ON

• PROBLEM 6

1. MR A IS A MERCHANT OF DELHI. HE SENDS HIS SON B TO MUMBAI WITH A LETTER ADDRESSED TO C A MERCHANT AND OF MUMBAI
2. B HANDS OVER THE  LETTER TO C AND KEEP WAITING THERE
3. C READS THE LETTER WHICH CONTAINS AN OFFER FROM A FOR THE SALE OF CERTAIN QUANTITY O F RICE
4. THE LETTER ALSO CONTAINS IF C ACCEPTS THE OFFER THEN HE MUST GIVE HIS REPLY TO B
5. C SEND B WITHOUT REPLY
6. BUT C LATER ON DECIDES TO ACCEPT A’S OFFFER BY TELEGRAM
7. THE TELEGRAM REACHES A BEFORE B REUNRS
8. IS IT VALID OCNTRACT

• ANSWER TO PROBLEM 6
• IT IS NOT VALID CONTRACT
• AS THE ACCEPTACNE WAS NOT MADE AS PER THE PRESCRIBED MODE
• PROBLEM 7

1. A OFFERS TO SELL HIS HOUSE TO B FOR RS 5 LACS
2. B SAYS THAT I ACCPET YOUR OFFER HERE IS RS 2 LACS IN CASH AND 3 MONTH PROMISSORY NOTE FOR THE BALANCE
3. IS THER ANY CONTRACT BETWEEN  A AND B

• SOLUTION TO PROBLEM 7
• NEEL V MRITT

1. M OFFERED TO SELL LAND AT $ 280
2. N REPLIED ACCEPTING THE OFFER AND ENCLOSING $ 30 AND PROMISING TO PAY BALANCE AMOUNT BY MONTHLY INSTALMENT OF DOLLAR 50 EACH
3. SINCE ACCPETED THE OFFER SUBJECT TO MAKING PAYMENTS IN INSTALMENTS
4. HELD THAT ACCPETANCE WAS CONDITIONAL AND QUALIFIED

• PROBLEM 8

1. A OFFERED HIS BIKE FOR SALE ON THURSDAY TO B
2. AGREED TO GIVE HIM THREE DAYS TIME TO ACCPET
3. BUT B ACCPETED THE OFFER ON MONDAY
4. BUT BY THE TIME A SOLD HIS BIKE TO C
5. CAN B SUE A

• SOLUTION TO THE PROBLEM 8
• A PROPSOAL WILL COME TO AN END BY THE LAPSE OF TME PRESCRIBED IN SUCH PROPOSAL FOR ITS ACCEPTANCE
• IF NO TIME IS PRESCRIBED THEN RESONABLE TIME PERIOD
• CASE : HEAD V DIGGEN

1. D OFFERED TO SELL WOOL TO H ON THURSDAY
2. AGREED TO HIM THREE DAYS TIME TO ACEPT
3. H ACCPETED THE OFFER ON MOANDAY
4. D HAS SOLD THE WOOL
5. HELD THAT THE OFFER HAD LAPSED

• PROBLEM 9

1. A OFFERS TO SELL HIS HOUSE FOR RS 1000
2. B REPLIES OFFERINGTO PAY RS 950
3. A REFUSES
4. SUBSEQUENTLY B WRITES ACCEPTING THE  ORIGINAL OFFER

• SOLUTION TO THE PROBLEM 9

1. IT IS THE CASE OF COUNTER OFFER
2. AN OFFER COMES TO AN END WHEN THE OFFEREE MAKE AN COUNTER OFFER OR REJECTS THE OFFER
3. WHERE AN OFFER IS ACCEPTED WITH SOME MODIFICATION IN THE TERMS OF OFFER OR WITH SOME OTHER CONDITION NT FORMING PART OF THE OFFER
4. SUCH QUALIFIED ACCPETANCE AMOUNTS TO COUNTER OFFER
5. AN OFFER ONCE REJECTED CAN NOT BE REVIVED

• CASE HYDE V WRENCH ( PROBLEM 10)

1. A OFFERED TO SELL A FARM FOR RS POUND 1000
2. X SAID HE WOULD GIVE 950 POUND
3. A REFUSED AND THEN X SAID HE WOULD GIVE POUND 1000
4. A DECLINED TO ADHERE TO HIS ORIGINAL OFFER AND  TRIED TO OBTAIN SPECIFIC PERFORMANCE

• SOLUTION TO THE PROBLEM 10

1. THERE WAS NO CONTRACT AS X X’S OFFER TO PAY 950 POUND WAS REFUSAL TO THE OFFER AND COUNTER OFFER
2. WHEN X OFFERED 1000 POUND AND HE WAS MAKING A NEW OFFER
3. IT HAS TO BE ACCEPTED BY A BEFORE T A BINDING CONTRACT COULD COME INTO AN EXISTENC
4.  A COUNTER OFFER IS A REJECTION OF THE ORIGINAL OFFER AND MAKING A NEW OFFER AND NEW OFFER IS COUNTER OFFER
5. A PERSON WHO MAKES COUNTER OFFER AND SUBSEQUNETLY CHANGES HIS MIND AND WISHES TO ACCPET THE ORIGINAL OFFER CANNOT DO SO AS THE FIRST OFFER LAPSE AND HE CAN NOT TREATS AS STILL OPEN.

• PROBLEM 11
•  D WROTE TO P ON 28 TH NOVEMBER 1971 OFFERING TO SEL 800 TONNES OF IRON AT 6900 PER TON
• ON THE SAME DAY P WROTE TO D OFFERING TO BUY 800 TONS OF IRON 6900 PER TON
• THE TWO LETTERS CROSSED IN POST AND NEITHER OF THEM KNEW ANY THING ABOUT THE OFFER TO THE OTHER
• P CONTENED THAT THERE WAS A GOOD CONTRACT
• SOLUTION TO PROBLEM 11

1. D WAS NOT BOUND AS RESULT OF THE SIMULTANEOUS OFFERS,EACH BEING MADE IN IGNORANCE OF THE EACH OTHER
2. IT IS A CASE OF CROSS OFFER
3. WHEN TWO PARTIES MAEK IDENTICAL OFFERS TO EACH OTHER IN IGNORANCE OF EACH OTHER’S OFFER
4. THEY SHALL NOT CONSTITUTE ACCEPTANCE OF ONE’S OFFER BY THE OTHER