One of the early steps in the formation of contract lies in arriving at an agreement between the contracting parties by means of offer and acceptance. One party makes a definite proposal to the other, and that other accepts it in its entirety. Offer An offer is also called a proposal. Sec.2 (a) of the Indian Contract Act defines a proposal as, “When one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other to such act or abstinence, he is said to make a proposal”. The person making the proposal is called the “proposer”, or “offeror” and the person to whom the proposal is made is called the “offeree”. Essentials of Valid Offer It must contain definite, unambiguous and certain and not loose and vague terms. It must intend to give rise to legal relationship. Continue reading
Legal Environment of Business
Crossing of Cheques
Crossing means drawing two parallel transverse lines across the face of the cheque with or without the words “and company” in between the lines. It is a direction to the drawee bank not to pay the amount at the counter, but only through a bank. It is made to guard payment against forgery by unscrupulous persons. Crossing of cheques is of two kinds: (1) General Crossing and (2) Special Crossing. 1. General Crossing Sec. 123 of the Negotiable Instruments Act defines General Crossing as, “where a cheque bears across its face an addition of the words ‘And Company’ or any abbreviation thereof, between two parallel transverse lines or of two parallel transverse lines simply, either with or without the words ‘not negotiable’, that addition shall be deemed to be a crossing and the cheque shall be deemed to be crossed generally”. Two parallel transverse lines across the face of the Continue reading
Damages for Breach of Contract
Damages are a monetary compensation allowed to the injured party by the Court for the loss or injury suffered by him by the breach of a contract. The object of awarding damages for the breach of contract is to put the injured party in the same position, so far as money can do it, as if he had not been injured, i.e. in the position in which he would have been had there been performance and not breach. This is called the doctrine of restitution. The rules relating to damages may be considered as under: 1. Damages arising naturally – Ordinary damages When a contract has been broken, the injured party can recover from the other party such damages as naturally and directly arose in the usual course of things from the breach. This means that the damages must be the proximate consequence of the breach of contract. These damages Continue reading