What is an agreement?
Section 2(e) of the Indian Contract Act, 1872 says that a “agreement” is “every promise and every set of promises forming the consideration for each other.” And a promise is an offer that is taken. And a promise is an offer that is taken. Section 2(b) of the same law says, “A proposal becomes a promise when it is accepted.”
To put it another way, a deal is a plan that is accepted. A contract is an agreement, and an agreement is a promise. A promise is an offer that is accepted. So, in the end, every deal comes from one side making a suggestion and the other side agreeing to it.
To sum up the information above, it could be written like this:
Agreement= Offer + Acceptance
For example, Andrew tells Jessica that he will sell his Samsung Tablet for Rs. 20,000, and Mona agrees to buy it for that amount. In this case, “Andrew” and “Jessica” made a deal.
What Does “Void Agreement” Mean?
Section 2(g) of the Indian Contract Act, 1872 says that a “void agreement” is “an agreement which is not enforceable by law.”
- Void agreements under Indian contract
Expressly declared void agreement
The Indian Contract Act of 1872 had rules from Section 24 to Section 30 and Section 56 about agreements that are deemed invalid. These are described below:
Section 24: Agreements are null and void if the consideration and goals are partly illegal.
Any part of a single payment for more than one thing, or any part of any one of several payments for the same thing, that is against the law, the deal is null and void.
In the case of Gopalrao v. Kallappa[3], someone was given permission to sell opium and ganja, but only if they agreed not to bring anyone else into the opium- Ganja business without the collector’s approval. Later, he took on a partner without the collector’s permission, but only after getting a set amount of money from him as his share of the capital. Because they didn’t agree on something, the new partner tried to get the contract broken and his money back, but the court said that the contract could not be broken.
Section 25: Agreements without consideration
This part says that an agreement made without consideration is not valid unless it is in writing and recorded, a promise to pay for something that was done, or a promise to pay a bill that has passed its due date.
Section 26: Agreement to prevent marriage is null and void
Any agreement that stops a major (not a child) from getting married is null and void.
In Lowe v. Peers, the husband said that if he married someone other than the woman, he would give her 1,000 pounds within three months of the wedding. However, the court said that such an agreement is not valid.
Section 27: An agreement to stop or slow down trade is not valid
It is against the law for anyone to agree to something that stops them from doing a legal job, like starting or continuing a business or trade, in exchange for money.
In the case of Madhub Chander v. Raj Coomar, the Calcutta High Court was the first to look at the scope of this part.
“The groups that deal with agreements that hurt trade must be able to change, and the groups can never be closed.”
One exception is in this part. That is, Sale of Goodwill—Save of understanding not to run the business whose goodwill is sold.
There are some exceptions to this part that cover restraints that bind a person. These would not be invalid.
Lawyers from Firm Daulat Ram and Firm Dharm Chand agreed that only one of their companies would be open at a time and that the profit would be split between them as a partnership. This meant that the limit was valid.
Section 28: Agreements that stop legal action are null and void
- a) It says that if a contract is broken, any agreement that stops a party from going to court or commission or limits the time they have to do so is null and void.
- b) It also says that a deal that takes away someone’s rights or frees both sides from responsibility is not valid.
There are three exceptions to this section:
1) The ability to save the contract in case of a court disagreement.
2) Saving the contract to answer questions that have already come up.
3) Saving a security agreement from a bank or other financial company.
Food Corporation of India v. New India Assurance Co. Ltd. was a case where the Supreme Court said that an agreement shouldn’t be interpreted in a way that stops the other party from going to court to help them.
Section 29 Agreements void for uncertainty
Section 29 talks about agreements that aren’t valid because of doubt. It says that agreements whose meaning isn’t clear or can’t be made clear aren’t valid.
Section 30: Bet-based agreements are not valid.
In this part, a deal to bet is said to be invalid. One exception in favor of certain horse race awards.
Hawkins J. gives a very clear explanation of what a wager is in the case of Carlill v. Carbolic Smoke Ball Co.
| Section 56. Agreement to do an impossible act This section says that an agreement to do something that can’t be done is null and void. Take the example of Tina and Kapil’s deal to use magic to find a prize. This deal is not valid because it is impossible to carry out. As a result, we can say that void agreements are deals that are not binding by law and have no legal power. We can also say that an agreement that doesn’t meet the basic requirements of a contract isn’t valid. For example, an agreement made by a child, an agreement made without thought, or an agreement that goes against public policy are all examples of void agreements.
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