Bcoc 133 2022-23

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BCOC 133 SOLVED

ASSIGNMENT 2022-23
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TUTOR MARKED ASSIGNMENT COURSE CODE : BCOC-133 COURSE TITLE :


BUSINESS LAW ASSIGNMENT CODE : BCOC-133/TMA/2022-23 COVERAGE :
ALL BLOCKS Maximum Marks: 100 Note: Attempt all the questions.
Section – A
1) Explain briefly the law relating to communication of offer, acceptance and
revocation. Is there any limit of time after which an offer cannot be revoked? (10)
Ans. The law relating to communication of offer, acceptance, and revocation is a fundamental
aspect of contract law. It sets out the requirements for creating and terminating contracts,
which are legally binding agreements between two or more parties.
An offer is a proposal made by one party to another, expressing an intention to enter into a
contract on certain terms. The offer must be communicated clearly and with sufficient detail
to enable the other party to understand the terms of the proposed agreement. If the offer is
accepted, it creates a binding contract between the parties.
Acceptance is the expression of agreement to the terms of the offer. It must be communicated
clearly and unambiguously, and must be made in the manner and within the time specified by
the offeror. Silence or inaction does not generally constitute acceptance, unless the offeror
has expressly stated that it will be accepted in this way.
Revocation is the act of withdrawing an offer before it is accepted. The offeror may revoke
an offer at any time before it is accepted, but must communicate the revocation to the offeree
before acceptance. Once an offer is accepted, it cannot be revoked, and a binding contract is
created.
There are some limits to the right of an offeror to revoke an offer. One such limit is the
doctrine of promissory estoppel, which prevents an offeror from revoking an offer if the
offeree has relied on the offer to their detriment. For example, if an offeror promises to sell a
car to an offeree at a certain price, and the offeree sells their own car in reliance on that
promise, the offeror may be prevented from revoking the offer.
Another limit on the right to revoke an offer is the existence of an option contract. An option
contract is a contract in which the offeror grants the offeree the right to accept the offer
within a specified period of time, during which the offeror cannot revoke the offer. In
exchange for this right, the offeree usually pays a fee or some other form of consideration.
In general, there is no specific time limit after which an offer cannot be revoked. However, if
an offeror sets a time limit for acceptance, they may not revoke the offer before the expiration
of that period. Additionally, if the offeree has already accepted the offer, the offeror cannot
revoke it, even if the acceptance was communicated after the offeror attempted to revoke the
offer.
In conclusion, the law relating to communication of offer, acceptance, and revocation is a
crucial aspect of contract law, and sets out the requirements for creating and terminating
legally binding contracts. While an offer may generally be revoked at any time before
acceptance, there are limits on this right, such as the doctrine of promissory estoppel and the
existence of option contracts. While there is no specific time limit after which an offer cannot

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be revoked, an offeror may not revoke an offer before the expiration of a time limit for
acceptance, and cannot revoke an offer after it has been accepted.

2) “Insufficiency of consideration is immaterial, but a valid contract must be supported


by lawful and real consideration.” Comment. (10)
Ans. The statement, "Insufficiency of consideration is immaterial, but a valid contract must
be supported by lawful and real consideration," is an important principle in contract law. It
highlights the two key elements that must be present in a contract in order to make it
enforceable: consideration and legality.
Consideration is defined as something of value that is given in exchange for a promise. It can
be in the form of money, goods, services, or any other type of benefit. The key point is that it
must be real, and not something that is insignificant or nominal. This is important because the
consideration must be enough to support the bargain between the parties. If the consideration
is too small, then the contract is not enforceable, because the parties have not made a
meaningful exchange.
However, even if the consideration is insufficient, the contract is still considered valid,
provided that the other requirements for a contract are met. This means that if the parties have
entered into a contract voluntarily, and with a full understanding of the terms, then the
contract will still be enforceable, even if the consideration is not of equal value.
The second element that must be present in a contract is legality. This means that the contract
must not be illegal or against public policy. A contract that is illegal or against public policy
is unenforceable, even if the other requirements for a contract are met. For example, a
contract to sell illegal drugs is unenforceable, because it violates the law.
In conclusion, it is important to understand that a valid contract must be supported by both
lawful and real consideration. While the insufficiency of consideration is immaterial, it is still
essential that the consideration be enough to support the bargain between the parties.
Additionally, the contract must also be legal and not against public policy. These
requirements ensure that contracts are enforceable, and that the parties have made a
meaningful exchange of value.

3) Enumerate the different types of partners and briefly explain the extent of their
liabilities. (10)
Ans. In a partnership, there are several types of partners, each with its own unique
characteristics and extent of liability. The different types of partners include:
General Partners: General partners are fully liable for the debts and obligations of the
partnership. This means that they can be held personally responsible for any debts or
obligations that the partnership incurs. General partners are also responsible for managing the
day-to-day operations of the partnership.

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Limited Partners: Limited partners are only liable to the extent of their capital contributions
to the partnership. They do not have any management responsibilities and cannot be held
personally responsible for the debts and obligations of the partnership. Limited partners are
generally passive investors and do not participate in the management of the partnership.
Silent Partners: Silent partners are similar to limited partners in that they are only liable to the
extent of their capital contributions. However, unlike limited partners, silent partners may
have some involvement in the management of the partnership, but their involvement is
usually limited to providing advice and guidance.
Managing Partners: Managing partners are responsible for the day-to-day management of the
partnership. They may also be personally liable for the debts and obligations of the
partnership, depending on the terms of the partnership agreement.
Nominal Partners: Nominal partners are individuals who are named as partners in the
partnership agreement, but who do not actually participate in the management or operations
of the partnership. They are not liable for the debts and obligations of the partnership.
Sleeping Partners: Sleeping partners are individuals who have invested capital in the
partnership, but who do not participate in the management or operations of the partnership.
They are only liable to the extent of their capital contributions.
It is important to note that the extent of liability for each type of partner can vary depending
on the terms of the partnership agreement and the laws of the jurisdiction in which the
partnership operates. Additionally, the type of partnership (e.g., limited liability partnership,
general partnership, etc.) can also affect the extent of liability for each partner.
In a general partnership, all partners are generally considered to be general partners and are
fully liable for the debts and obligations of the partnership. In a limited liability partnership
(LLP), all partners are considered limited partners and are only liable to the extent of their
capital contributions.
In a limited partnership (LP), there must be at least one general partner who is fully liable for
the debts and obligations of the partnership, while the other partners are limited partners and
are only liable to the extent of their capital contributions.
It is important to carefully consider the type of partnership and the extent of liability for each
partner before entering into a partnership agreement. This can help to minimize the risk of
personal liability and protect the partners’ personal assets. Additionally, having a well-drafted
partnership agreement that clearly outlines the roles, responsibilities, and liabilities of each
partner can help to prevent disputes and ensure that the partnership runs smoothly.

4) “No seller of goods can give to the buyer a better title than he himself has”. Explain
this rule. Are there any exceptions to this rule? (10)
Ans. The rule "No seller of goods can give to the buyer a better title than he himself has" is a
fundamental principle in the law of sales of goods. It means that a seller cannot transfer

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ownership of goods to a buyer if the seller does not have good title to the goods. In other
words, the seller must have the right to sell the goods in order for the transfer of ownership to
be valid.
If the seller does not have good title to the goods, the transfer of ownership to the buyer will
not be valid. In such cases, the buyer will not have good title to the goods, and may not be
able to enforce his rights against third parties who claim ownership of the goods.
There are several exceptions to this rule. For example, if the seller is acting as an agent for a
principal who has good title to the goods, the seller can transfer good title to the buyer, even
if the seller does not have good title himself. Additionally, if the seller acquires good title to
the goods after the contract of sale has been made, but before delivery of the goods, the
transfer of ownership will still be valid, even if the seller did not have good title at the time of
the contract.
Another exception to this rule is the doctrine of estoppel. If the seller makes a false
representation to the buyer about his title to the goods, and the buyer relies on that
representation in entering into the contract of sale, the seller may be estopped from denying
his title. In such cases, the transfer of ownership to the buyer will be valid, even if the seller
did not have good title at the time of the contract.
It is also important to note that the rule applies only to the sale of goods, and not to the sale of
real property. In the sale of real property, the seller can transfer good title to the buyer, even
if the seller does not have good title himself. This is because the law of real property operates
differently than the law of sales of goods.
In conclusion, the rule "No seller of goods can give to the buyer a better title than he himself
has" is a fundamental principle in the law of sales of goods. It means that a seller cannot
transfer ownership of goods to a buyer if the seller does not have good title to the goods.
There are several exceptions to this rule, including the seller acting as an agent, the seller
acquiring good title after the contract of sale, and the doctrine of estoppel. It is important for
both buyers and sellers to understand this rule and the exceptions to it in order to ensure that
the transfer of ownership of goods is valid and enforceable.

5) Discuss the essentials of a contract of bailment and state the rights and duties of a
bailee. (10)
Ans. A contract of bailment is a legal agreement between two parties, where one party, the
bailor, entrusts property to another party, the bailee, for a specific purpose. The bailee has the
responsibility to take care of the property and return it to the bailor once the specific purpose
has been fulfilled.
The essentials of a contract of bailment include:
Delivery of the property: In a contract of bailment, the bailor must deliver the property to the
bailee. This delivery can be actual or constructive. Actual delivery means that the property is

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physically handed over to the bailee, while constructive delivery refers to the transfer of
control over the property, without physically handing it over.
Purpose: A contract of bailment must have a specific purpose, which is agreed upon by both
the bailor and the bailee. This purpose could be anything from storage to repair, but it must
be specific and agreed upon by both parties.
Bailor's Ownership: The bailor must be the owner of the property or have the right to bail it
out. If the bailor does not have ownership or the right to bail the property, the contract of
bailment will be void.
Bailee's obligation to return the property: The bailee must return the property to the bailor
once the purpose for which it was bailed has been fulfilled. The bailee is also responsible for
taking proper care of the property and returning it in the same condition as it was received,
except for normal wear and tear.
Free of Charge: A contract of bailment must be free of charge, unless otherwise agreed upon
by the bailor and bailee. If the bailee is to receive compensation for his services, it must be
agreed upon beforehand.
The rights and duties of a bailee can be divided into the following categories:
Right to retain the property: The bailee has the right to retain the property until the bailor
fulfills his obligations under the contract of bailment. This includes paying any charges due
or fulfilling any other conditions agreed upon by both parties.
Duty to take care of the property: The bailee has a duty to take reasonable care of the
property bailed. The level of care required will depend on the nature of the property and the
purpose of the bailment.
Duty to return the property: The bailee has a duty to return the property to the bailor once the
purpose for which it was bailed has been fulfilled. If the bailee does not return the property,
he may be liable for any damages suffered by the bailor as a result.
Right to compensation: The bailee has the right to receive compensation for any expenses
incurred in taking care of the property, if it was agreed upon beforehand. This includes
expenses such as storage fees or repairs made to the property.
Duty to cooperate with the bailor: The bailee has a duty to cooperate with the bailor and
provide any information requested by the bailor. This includes information about the
condition of the property and any expenses incurred in taking care of it.
In conclusion, a contract of bailment is a legal agreement between two parties, where one
party entrusts property to another party for a specific purpose. The essentials of a contract of
bailment include delivery of the property, a specific purpose, bailor's ownership, bailee's
obligation to return the property, and being free of charge. The rights and duties of a bailee
include the right to retain the property, the duty to take care of the property, the duty to return
the property, the right to compensation, and the duty

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Section – B
6) Define the term “proposal”. Discuss the essentials of a valid offer. (6)
Ans. A proposal, also known as an offer, is a statement made by one party with the intention
of creating a legally binding agreement with another party. In the context of contract law, a
proposal is a crucial element as it lays out the terms and conditions of the agreement and sets
the foundation for the formation of a contract.
The essentials of a valid offer are:
Certainty: The offer must be clear and unambiguous, outlining the terms and conditions of
the agreement. The terms of the offer must be definite and not vague or open-ended.
Communication: The offer must be communicated to the offeree. Communication can be
through various methods, including written, verbal, or by conduct.
Intent to create legal relations: The offer must show an intention to create a legally binding
agreement. This means that the parties involved must have a genuine intention to enter into a
contract and be bound by its terms.
Possibility of acceptance: The offer must be capable of being accepted by the offeree. This
means that the terms of the offer must be such that they can be fulfilled.
Specific subject matter: The offer must have a specific subject matter, which is the item or
service that is the subject of the agreement.
Time limit: The offer must have a time limit for acceptance. This means that the offer will
only remain open for a specific period, after which it will expire.
Capacity to contract: Both the offeror and offeree must have the capacity to enter into a
contract. This means that they must have the legal capacity to enter into a binding agreement,
such as being of legal age and not being under any disability.
In conclusion, a proposal, also known as an offer, is a statement made by one party with the
intention of creating a legally binding agreement with another party. The essentials of a valid
offer include certainty, communication, intent to create legal relations, possibility of
acceptance, specific subject matter, time limit, and capacity to contract. These elements are
crucial in the formation of a contract, as they set the foundation for the terms and conditions
of the agreement and ensure that the parties involved have a clear understanding of their
obligations.

7) Define mistake and explain various types of mistakes. (6)


Ans. Mistake, in the context of contract law, refers to a false understanding of facts or
circumstances by one or both parties involved in the formation of a contract. Mistakes can
have an impact on the validity of the contract and the obligations of the parties involved.
There are various types of mistakes in contract law, including:

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Unilateral mistake: This occurs when only one party to the contract is under a mistake. For
example, if a person sells an item believing it to be worth a certain amount, but it is later
discovered that the item is worth much less, the seller may be under a unilateral mistake.
Mutual mistake: This occurs when both parties to the contract are under a mistake regarding
the same fact. For example, if both parties to a contract believe a certain item to be worth a
certain amount, but it is later discovered that the item is worth much less, both parties may be
under a mutual mistake.
Mistake of fact: This occurs when a party to the contract is under a mistake about a material
fact. For example, if a person agrees to purchase a car believing it to be in excellent
condition, but it is later discovered that the car has serious mechanical issues, the person may
be under a mistake of fact.
Mistake of law: This occurs when a party to the contract is under a mistake about the law. For
example, if a person enters into a contract believing that a certain act is legal, but it is later
discovered that the act is illegal, the person may be under a mistake of law.
Mistake of identity: This occurs when a party to the contract is under a mistake about the
identity of the other party. For example, if a person enters into a contract with an individual
believing that person to be someone else, the person may be under a mistake of identity.
In conclusion, mistake refers to a false understanding of facts or circumstances by one or both
parties involved in the formation of a contract. There are various types of mistakes in contract
law, including unilateral mistake, mutual mistake, mistake of fact, mistake of law, and
mistake of identity. These types of mistakes can have an impact on the validity of the contract
and the obligations of the parties involved, and it is important for parties to have a clear
understanding of the facts and circumstances surrounding a contract before entering into it.

8) Describe the rights and liabilities of partners on dissolution of a firm. (6)


Ans. When a partnership firm is dissolved, the partners' rights and liabilities can be affected
in several ways. Here are some of the key rights and liabilities of partners on the dissolution
of a firm:
Dissolution of the firm: Dissolution refers to the termination of a partnership firm, which can
occur voluntarily or involuntarily. Voluntary dissolution occurs when the partners agree to
dissolve the firm, while involuntary dissolution occurs due to the death, insanity, or
bankruptcy of a partner, or the expiration of a fixed term.
Payment of debts: On the dissolution of a firm, the partners are responsible for paying off the
firm's debts and liabilities. The partners must use the firm's assets to pay off the debts, and if
the assets are insufficient, the partners may be personally liable for the outstanding debts.
Distribution of assets: After the debts and liabilities of the firm have been paid off, the
remaining assets must be distributed among the partners. The distribution of assets must be in
accordance with the provisions of the partnership agreement or, if there is no partnership

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agreement, the distribution must be made in accordance with the provisions of the relevant
partnership laws.
Transfer of rights and interests: On the dissolution of a firm, the partners may transfer their
rights and interests in the firm to a third party or to another partnership firm. The transfer of
rights and interests must be made in accordance with the provisions of the partnership
agreement or, if there is no partnership agreement, the transfer must be made in accordance
with the provisions of the relevant partnership laws.
Termination of authority: On the dissolution of a firm, the authority of each partner to act on
behalf of the firm is terminated. This means that the partners can no longer enter into
contracts or transact business on behalf of the firm.
Continued liability: In some cases, the partners may continue to be liable for the obligations
of the dissolved firm. For example, if a partner has personally guaranteed a loan taken by the
firm, the partner may continue to be liable for the repayment of the loan even after the
dissolution of the firm.
In conclusion, on the dissolution of a partnership firm, the partners' rights and liabilities are
affected in several ways. The partners are responsible for paying off the firm's debts and
liabilities, and after the debts have been paid off, the remaining assets must be distributed
among the partners. The partners may also transfer their rights and interests in the firm to a
third party or to another partnership firm. The authority of each partner to act on behalf of the
firm is terminated on the dissolution of the firm, but in some cases, the partners may continue
to be liable for the obligations of the dissolved firm.

9) Distinguish between the right of lien and stoppage-in-transit. (6)


Ans. The right of lien and stoppage-in-transit are both legal remedies available to a seller or
creditor to protect their interests in goods that have been sold or shipped but not yet delivered
to the buyer.
The right of lien refers to the seller's right to retain possession of goods until they receive
payment for the goods or services they have provided. This means that the seller can hold
onto the goods even if the buyer has already taken possession of them, and can refuse to
deliver the goods until they are paid.
Stoppage-in-transit, on the other hand, is the right of a seller to stop the delivery of goods that
are in transit to the buyer, in cases where the seller has reason to believe that the buyer may
not be able to pay for the goods. This right is usually exercised when the goods are in the
possession of a carrier or other third party.
In summary, the right of lien allows a seller to retain possession of goods already delivered,
while stoppage-in-transit allows a seller to stop delivery of goods that are in transit to the
buyer.

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10) Discuss the common features among promissory note, bill of exchange and cheque.
(6)
Ans. Promissory notes, bills of exchange, and cheques are all negotiable instruments that are
commonly used in financial transactions. Here are some common features of these
instruments:
They are all written promises to pay a sum of money to a particular person or entity.
They are all legally binding documents that create a debtor-creditor relationship between the
parties involved.
They all have specific payment terms, such as the amount to be paid, the due date, and the
interest rate (if any).
They can be transferred or endorsed to a third party, which means that the holder of the
instrument can transfer their rights to receive payment to another person.
They are all subject to various laws and regulations, such as the Uniform Commercial Code
(UCC) in the United States, which provide rules governing their use and enforceability.
They are all used as a means of payment in business transactions, such as paying for goods or
services, or settling debts.
Despite these common features, there are some important differences among promissory
notes, bills of exchange, and cheques. For example, a promissory note is a written promise by
one party to pay a sum of money to another party, while a bill of exchange is a written order
by one party to another party to pay a sum of money to a third party. A cheque, on the other
hand, is a written order by a depositor to their bank to pay a sum of money to a specific
payee. These differences can affect the legal rights and obligations of the parties involved, as
well as the rules governing their negotiation and payment.

Section – C
11) Distinguish between :
(i) Coercion and undue influence
Ans. Coercion and undue influence are two legal concepts that can affect the validity of a
contract or agreement. Here's a brief explanation of each concept:
Coercion is the use of physical force, threats, or intimidation to compel someone to enter into
a contract or agreement against their will. In other words, coercion involves using force or
fear to make someone do something they would not normally do. If a contract is entered into
as a result of coercion, it is considered to be voidable, meaning that the party who was
coerced can choose to void the contract and be released from its obligations.

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Undue influence, on the other hand, is the use of unfair or improper persuasion to influence
someone to enter into a contract or agreement. Unlike coercion, undue influence does not
involve physical force or threats, but rather the abuse of a position of power or trust. For
example, if a person in a position of authority over another person, such as a doctor or
caretaker, uses their influence to pressure the other person into signing a contract, this may be
considered undue influence. If a contract is entered into as a result of undue influence, it is
also considered to be voidable.
In both cases, the burden of proof is on the party alleging coercion or undue influence to
demonstrate that the other party was compelled or unduly influenced into entering into the
contract. If successful, the affected party can seek to have the contract set aside and may be
entitled to damages or other remedies.

(ii) Fraud and Misrepresentation (5)


Ans. Fraud and misrepresentation are both legal concepts that involve false statements or
information in the context of a contract or agreement. However, there are some key
differences between the two:
Fraud is the deliberate or intentional misrepresentation of material facts by one party to
another, with the intent to deceive and induce the other party to act on the false information.
Fraud can involve making false statements, concealing or omitting important information, or
making promises that the party has no intention of keeping. If a contract is entered into as a
result of fraud, it is considered to be voidable, meaning that the party who was defrauded can
choose to void the contract and be released from its obligations. The defrauded party may
also be entitled to damages or other remedies.
Misrepresentation, on the other hand, is a broader term that can encompass both intentional
and unintentional misstatements or omissions of material facts. Unlike fraud,
misrepresentation does not require proof of intent to deceive or defraud. If a contract is
entered into as a result of misrepresentation, it may also be considered voidable, but the
remedies available may be more limited than those available in cases of fraud.
In both cases, the false statements or information must be material, meaning that they are
significant enough to influence the decision-making of the other party. The burden of proof is
on the party alleging fraud or misrepresentation to demonstrate that the other party made false
statements or omissions, and that they were material to the contract or agreement.

12) “An agreement in restraint of trade is void”. Examine this statement mentioning
exceptions, if any. (5)
Ans. The principle that "an agreement in restraint of trade is void" is a basic principle of
contract law. The idea behind this principle is that individuals and businesses should have the

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freedom to carry on their trade or profession as they see fit, without undue interference from
contractual obligations. However, there are some exceptions to this general rule, which I will
discuss below.
Firstly, agreements that are reasonable in scope and duration may be enforceable. This means
that if a restraint of trade provision in a contract is limited in terms of the time period or
geographic scope, and is necessary to protect a legitimate business interest, such as
confidential information or customer relationships, it may be upheld by a court.
Secondly, non-compete agreements in connection with the sale of a business are also
generally enforceable. In the context of a business sale, it may be reasonable for the buyer to
require that the seller not compete with the business for a certain period of time, in order to
protect the goodwill of the business that has been purchased.
Thirdly, certain professions, such as lawyers and doctors, may be subject to more restrictive
restraints on their ability to compete, due to the nature of their work and the professional
obligations that they owe to their clients.
Overall, the general principle that "an agreement in restraint of trade is void" remains a
fundamental aspect of contract law. However, there are some limited exceptions to this rule,
depending on the particular circumstances of the case.

13) What can’t be a partner of a Limited Liability Partnership? (5)


Ans. In a Limited Liability Partnership (LLP), the partners are typically individuals or other
businesses. However, there are some types of entities or individuals who may be restricted
from being a partner in an LLP. Here are some examples:
Companies: A company cannot be a partner in an LLP. Only individuals or other businesses
(such as partnerships or LLPs) can be partners in an LLP.
Minors: Minors, i.e. persons who have not yet reached the age of majority, cannot be partners
in an LLP. This is because they are not legally able to enter into contracts.
Undischarged bankrupts: Individuals who are currently undischarged bankrupts are generally
not able to be partners in an LLP. This is because they may be restricted by law from
participating in certain types of business activities.
Persons disqualified from acting as company directors: Individuals who have been
disqualified from acting as company directors under the Companies Act 2006 may also be
restricted from acting as partners in an LLP.
Persons restricted by law or regulation: Certain types of professionals, such as solicitors or
accountants, may be subject to regulatory restrictions that prevent them from being partners
in an LLP.
It's important to note that the specific rules and restrictions on who can be a partner in an LLP
may vary depending on the jurisdiction and the governing law.

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14) Explain the essentials of valid contract of sale. (5)


Ans. A contract of sale is an agreement between a buyer and a seller in which the seller
agrees to transfer ownership of goods or property to the buyer in exchange for payment. For a
contract of sale to be legally enforceable, it must meet certain requirements or essentials,
which include:
Offer and acceptance: There must be a clear offer by the seller to sell the goods or property,
and an acceptance of that offer by the buyer. The terms of the offer and acceptance must be
definite and certain, and must be communicated clearly to both parties.
Intention to create legal relations: The parties must have a clear intention to create a legally
binding contract. This means that both parties must understand and agree that they are
entering into a legally enforceable agreement.
Consideration: There must be a price or other form of consideration that is agreed upon by
both parties in exchange for the goods or property being sold. The consideration must be
something of value, such as money or another form of payment.
Capacity of the parties: Both the buyer and the seller must have the legal capacity to enter
into the contract. This means that they must be of legal age, and must not be under any legal
disability, such as mental incapacity or bankruptcy.
Free consent: The agreement must be entered into by both parties with their free and
informed consent. This means that there must not be any undue influence, coercion, fraud or
misrepresentation involved in the formation of the contract.
Object of the contract: The object of the contract must be lawful, and the goods or property
being sold must be capable of transfer of ownership.
Compliance with formalities: Depending on the governing law and the nature of the goods or
property being sold, there may be certain formalities that must be followed in order for the
contract to be valid. For example, certain contracts may need to be in writing or signed by
both parties.
If all of these essential elements are present in a contract of sale, it will generally be
considered a valid and legally enforceable agreement.

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