To understand what breach of contract is we need to first know the basics of contracts. In today’s world, contracts have become an indispensable part of our lives. From joining work by entering an employment contract to buying goods from a sale, we are entering into a contract every now and then. Such being the case one needs to know the basics of contract, what a Breach of contracts is and what are the remedies for breach of contract. <\/p>\n\n\n\n
In\nthis article, we’ll discuss the basics of contracts, essentials of a contract\nand breach of contracts and its remedies. <\/p>\n\n\n\n
The\nIndian Contract Act, 1872 in section 2(h) defines contracts. It states a\ncontract is a legally enforceable agreement in oral or written form between two\nor more parties. In simple terms, it is a set of promises where one party\npromises to do something for the other for some benefit or consideration.<\/p>\n\n\n\n
The\nmain difference between an oral contract and a written one is that oral\ncontracts are harder to prove because they are not written down. The oral\ncontracts are susceptible to error because of lack of clarity and certainty.\nDue to this, one should always opt for written contracts. By putting the\nagreement in writing the parties get to know the terms and conditions which\nthey have agreed upon.<\/p>\n\n\n\n
Following\nare the essential characteristics of a contract-<\/p>\n\n\n\n
The\nparties to the contract must have a clear understanding of the subject matter\nof contract. There must be an offer from one party and acceptance of such offer\nby the other party. <\/p>\n\n\n\n
Every\nparty should be competent to enter into an agreement. For instance, you cannot\nenter into an agreement with a minor. Both the parties must be major and of\nsound mind for entering into a contract.<\/p>\n\n\n\n
To\nform a valid contract the consent of the parties need to be free. All the\nparties must have agreed upon the subject matter of agreement in the same sense\nand in the same manner. If the agreement is caused by coercion, fraud,\nmisrepresentation or mistake then under section 14 of the Indian Contract Act,\nthe contract is deemed voidable and not enforceable by law. <\/p>\n\n\n\n
If\nthe object of the agreement is unlawful, then the contract is void.<\/p>\n\n\n\n
Consideration\nmeans “something in return”. It means the price paid by one party for\nfulfilling the promise by another. If there is no consideration or the\nconsideration is unlawful then the contract is void.<\/p>\n\n\n\n
Agreement\nshould not have been declared void under any law in India.<\/p>\n\n\n\n
In\na contract, the parties are legally bound to perform their respective promises\nif the agreement is enforceable by law. Section 37 of the Indian Contract Act\nalso talks about this. It states that the parties are under an obligation to\nperform their promises unless and until such performance is dispensed under the\nContract Act or any other law.<\/p>\n\n\n\n