Contracts & Torts – AILET Study Notes
Purpose – These notes give a quick, clear, and exam‑ready overview of the core concepts of Contracts and Torts.
Format – Simple explanation → Key points → Worked example → Quick revision summary.
1. Contracts
Simple Explanation
A contract is a legally enforceable promise or set of promises between two or more parties. In India, the essential elements are:
- Offer & Acceptance – One party proposes, the other accepts.
- Consideration – Something of value exchanged.
- Capacity – Parties must be legally competent.
- Free & Genuine Consent – No coercion, undue influence, fraud, or misrepresentation.
- Lawful Object – The purpose must be legal.
If any element is missing, the contract may be void, voidable, or invalid.
Key Points
| Category | Details | Notes |
|---|---|---|
| Formation | • Offer followed by acceptance (unilateral or bilateral). • Acceptance must be unconditional and mirror the offer. |
Acceptance may be revocable before completion of performance. |
| Consideration | • Must be real (something of value). • Can be past, current, or future consideration. |
The classical “for‑and‑with” rule is not mandatory. |
| Capacity & Consent | • Minors, unsound mind, and those under 18 are not fully competent. • Consent must be free, informed, and intelligent. |
Contracts made under duress, undue influence, or misrepresentation are voidable. |
| Void vs. Voidable | • Void: No legal effect (e.g., contract for illegal purpose). • Voidable: Valid until rescinded (e.g., contract with a minor). |
A party with a voidable contract may choose to affirm or rescind. |
| Breach & Remedies | • Actual Breach: Failure to perform. • Anticipatory Breach: Renunciation before performance. • Remedies: Damages (compensatory, punitive, nominal, liquidated), Specific Performance, Rescission, Reformation. |
Damages are intended to put the injured party in the position they would have been in had the contract been performed. |
| Specific Performance | • An equitable remedy (not always available). • Courts grant it when damages are inadequate (e.g., unique goods). |
Not available for contracts of sale of land (Rule 66). |
| Contracts for Sale of Goods | • Governed by Sale of Goods Act, 1930. • Key terms: price, delivery, risk, and title transfer. |
Risk passes upon delivery (unless otherwise agreed). |
| Contracts for Service | • Governed by Contracts Act, 1872. • Service must be specific, defined, and measurable. |
Non‑compensatory contracts (e.g., employment) are governed by Industrial Employment (Standing Orders) Act, 1946. |
| Statute of Limitations | • 2 years for breach of contract (Section 73(2) of the Contracts Act). | For certain contracts (e.g., land sale), the period may be longer. |
2. Torts
Simple Explanation
A tort is a civil wrong that causes harm or loss, giving rise to a legal liability. The core torts in Indian law include negligence, defamation, nuisance, trespass, and liability for animals. The classical tort is negligence (breach of a duty of care).
Key Points
| Tort | Elements | Remedy |
|---|---|---|
| Negligence | • Duty of care • Breach of that duty • Causation (actual & proximate) • Damage |
Damages (compensatory, punitive). |
| Defamation | • Statement (spoken or written) • False & harmful to reputation • Publication to a third party |
Damages (compensatory, moral) or slander (spoken) / libel (written). |
| Nuisance | • Interference with use/ enjoyment of property • Unreasonable & substantial |
Damages, injunction. |
| Trespass to Property | • Unlawful entry or interference with possession | Damages, injunction. |
| Conversion (of property) | • Unauthorized interference causing loss of use | Damages. |
| Liability for Animals | • Owner’s negligence in containing animal | Damages. |
| Vicarious Liability | • Employer liable for employee’s tort within course of employment | Damages. |
Common Elements of Negligence (Restatement of the Elements)
- Duty – The defendant owed a duty of care to the plaintiff.
- Breach – The defendant failed to meet that duty.
- Causation – The breach caused the plaintiff’s injury.
- Damages – The plaintiff suffered actual loss.
Quick Revision Summary of Torts
- Negligence: Duty → Breach → Causation → Damage.
- Defamation: False, harmful, published.
- Nuisance: Unreasonable interference.
- Trespass: Unlawful entry or interference.
- Conversion: Unauthorized use of property.
- Liability for Animals: Owner's duty to control.
3. Worked Example
Example 1 – Breach of Contract (Sale of Goods)
Facts
- A sells a second‑hand bicycle to B for ₹10,000.
- The agreement: B pays ₹10,000; A delivers the bicycle.
- A delivers a different model (a motorcycle) instead of the bicycle.
- B rejects the motorcycle and sues