Business & Industrial Law Complete Slides.pptx

8/14/2019 Business & Industrial Law Complete Slides.pptx

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BUSINESS & INDUSTRIALLAWS

ANSIR ALI KHAN


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The principles & regulations established in acommunity by a certain authority & applicable to itspeople, whether in the form of legislation or ofcustoms & policies recognized and enforced by

judicial decision.

Law is a system of rules, enforced through a set ofinstitutions used as an instrument to underpin civilobedience, politics, economics, and society.

Law serves as the foremost social mediator inrelations between people


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ccording to Holland

Law refers to a general rule of action, taking cognizance onlyof external acts enforced by a determinate authority, whichauthority is human, and among human authorities is thatwhich is permanent in a political society. ccording to John Erskine

Law is the command of a sovereign, containing a commonrule of life for his subjects and obliging them to obedience. ccording to De Montmorency

Coercion is a weapon of law which law has forged, but it isnot the basis of law. ccording to PoundLaw is the body of principles recognized or enforced bypublic and regular tribunals in the administration of justice.


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The science & philosophy of law is called Jurisprudence. It is the knowledge of law.

Kinds of Jurisprudence Historical Jurisprudence Ethical Jurisprudence

Analytical Jurisprudence


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Imperative LawPhysical or Scientific LawNatural or Moral Law

Conventional LawCustomary LawPractical or Technical LawInternational LawCivil Law


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Material Sources

Sources of Law

Formal Sources

Legal Sources HistoricalSources

Legislation Precedent Customs Agreement


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Al-Quran Sunnah Ijtehad

Sharia


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Process of legislation

When N.A isin session

All otherbills

N.A Senate

Reject

Moneybill

Act

President

When N.Anot in

session

AssentSent for

reconsideration byParliament

President

Ordinance


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Two important Bodies

Law Making(Legislating)

Law Implementing(Judiciary)

President

Parliament

Governor

Provincial Assembly

Supreme Court

Lower Courts

High Court


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High Court

Supreme Court

Lower Court is Comprising of Below

Criminal Civil

JudicialMagistrate

District Judge/Additional District

Magistrate

SeniorCivilJudge

CivilJudge


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Four Chief Justice- High Court

In Every Province

Punjab NWFP BalouchistanSindh

Chief Justice - Supreme Court

Islamabad


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High Court

In Every Province

Punjab NWFP BalouchistanSindhIslamabad


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Law

Name ofLaw

Year ofBecoming

Law

MakingBody

Contract ACT 1872

Always read three parts as name of Contract


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Law

Name ofLaw

Year offormation

MakingBody

Income Tax Ordinance 2001

Always read three parts as name of Contract


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Law making body

President and

Governor

ACTOrdinance

Parliament andProvincialassembly


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ACT is made by

ParliamentProvincialAssembly

JurisdictionOf Law

WholeCountry

JurisdictionOf Law

WholeProvince


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Jurisdiction area

President

Parliament

WholeProvinceWholeCountry

GovernorProvincialassembly


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Parliament

NationalAssembly Senate


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Bill

National Assembly

Simple Majority Pass

Senate

President Of PakistanBecome

LAW


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Constitutional Amendment

National Assembly

2/3rd Majority Pass

Senate

President Of PakistanBecome

LAW


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Relationship

Is Created by

Blood Contract

Brother & Sister

Father & Son

Husband & Wife

Sale / PurchaseEmployer / EmployeeLandlord / Tenant

Partnership Business


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How to become owner of Property/Goods

By

Inheritance Contract

Seller looses ownership &

buyer gets ownershipIncludes GIFT,Purchase, Sales


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It extends to the whole of Pakistan.It had 266 sections InitiallySec 1-75 ( General principles relating to all types ofcontracts)Sec 76-123( Repealed after enactment of Sale ofGood Act)Sec 124-147 (Contracts of Indemnity & Guarantee) Sec 148-181 ( Contracts of Bailment & Pledge)Contracts of Agency (Section 182-238)SEC 239-266 (Repealed after enactment ofPartnership Act)


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Contract is an agreement between two or

more persons creating rights & obligationsthat are enforceable by law.Section 2(h) of the Contract Act definesContract as an agreement enforceable by

law ContractA) AgreementB) Enforceable by law


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Section 2(e) defines Every promise or everyset of promises forming the consideration foreach other, is an agreement. Agreement Promise Consideration Plurality of persons


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Section 2(b) of the Contract Act defines when a person to whom the proposal ismade signifies his assent thereto, theproposal is said to be accepted. A proposalwhen accepted becomes a promise. Promise is Assent for acceptance To a proposal


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A contract is an agreement

An agreement is a promiseA promise is an acceptedproposalEvery agreement is result of aproposal from one side and its

acceptance from the other.


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An agreement is enforceable if it isrecognized by courts.It must create legal obligations between theparties( otherwise not a contract)All contracts are agreements but allagreements are not contracts.Agreements

Social ( do not enjoy the benefit of law, donotcreate legal obligation) Legal (creates legal obligations)


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Valid Contract - FLIPCANS

Free ConsentLegal Relationship

Legal ObjectIn writing if required by Law

Possible to PerformConsideration

Capacity of the parties

Agreement Not Expressly declared VoidSubject Matter


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According to Enforceability

According to formation

According to Performance


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Valid Contract

Voidable Contract

Void Contract


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Contract

Enforceability

Valid Void-able Void

Fully

EnforceableBy law/ court

AggrievedParty may

MakeContract as

Can not be

EnforceableBy CourtOr Law


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Express Contract

Implied Contract

Quasi or constructive Contract


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Contract

Formation

Expressed ConstructiveQuasi

By Conduct

Implied Contract

Oral

Written


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Executed Contract

Executory Contract


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Contract

Performance

Executory Executed

UnilateralContract BilateralContract

Spot

ReadyContract


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Executed Contract

Delivery100% on

Spot

Payment100% on

Spot


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Executory Contract

Unilateral

Case -1

Payment100% now

DeliveryPart now

Remainingin future

Case-1

Delivery100% Now

Full Deliveryin Future

PaymentPart now

Remainingin future

Full Paymentin Future


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Executory Contract

Bilateral

DeliveryIn Future

Payment inFuture

Today just

Words are shared


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Bilateral Contract

Performance

Future/ ForwardContract

Both parties areBound to do

as per contract

Both parties do their part of work at the

time of contract

Spot/ Ready basis

Executed Contract

Executory Contract


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Unilateral Contract

Performance

One party has doneHis part of act Other party is toDo his part of act

Before contract or

At the time ofcontract

At the time ofFormation of contract

After the FormationOf Contract


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Unilateral Contract

Buying of Goods

Advance Payment100% Delivery of GoodsBy Seller

At the time ofContract In Future Date


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Consent of Parties to the Contract

Consent is Free Consent is notFree

Coercion

Undue InfluenceFraud

MisrepresentationMistake

Existence of of the Following

CUFMM

No elements of the following


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Party A Party B

MakesMisrepresentations

With Party B

Consent of B is Now not free

Because B isUnder wrong impression

AGGRE

IVED

Misrepresentation is different from fraud


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Party A Party B

Makes CoercionInfluence

With Party B

Consent of B is Now not free

Because B is Underthreat of Mr. A

Coercion means using criminal tacticsOr weapon to threat other party

AGGRE

IVED


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Party A Party BBoth are underMistake

Consequence: Contract is Void


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Voidable Contract -CUFM

When Consent isNot Free due to

FraudUndue

InfluenceMisrepresentation Coercion

Consequence may be following

Contract may beenforceable

Contract may beterminated


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DISTINCTION B/W COERCION & UNDUE INFLUENCE


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PARTICULARSCOERCION UNDUE INFLUENCE

Nature Coercion is a physical threat eitherto property or person

Undue influence is a mental or moralthreat

Illegal & Unfair Coercion involves doing orthereatening to do an illegal act

In under influence the act may not beillegal, it may only be unfair

Penal ActionIn coercion, penal action is alsotaken against guilty party

In undue influence, generally no penalaction is taken aginst guilty party

Parties

Coercion may be exercised by oragainst the party to the agreement.It may also be exercised by oragainst some third party

Undue influence must be exercised by oragianst the party to the agreement

RelationshipFor coercion no specificrelationship b/w the parties isnecessary

For undue influence there must be aspecific relationship b/w the parties

Refund of BenefitIn coercion the aggrieved party hasto refund the benfits, if he hasreceived any, from the other party

In undue influence, the court hasdiscretion to direct the aggrieved party torefund the benefit, if he received from theother party.

EffectIn coerction, the contract isvoidable at the option of aggreievedparty

In undue influence, the contract is eightervoidable or the ourt may set aside it orenforece it in a modified form.

DISTINCTION B/W FRAUD & MISREPRESENTATION


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PARTICULARSFRAUD MISREPRESENTATION

INTENTIONIn case of fraud, the party makes afalse statement with an intention todeceive the other party

In case of misrepresentation, there is nointention to deceive the other party

Belief In case of fraud, the parson makingthe suggestion does not believe it

to be true

In case of misrepresentation, the personmaking the suggestion believe it to be true

DamagesIn fraud the aggrieved party canclaim damages in addition to theright of avoiding the contract

In misrepresentation entitiles the party toavoid contract and there can be no suit fordamages

OffenceFraud may amount to an offecne ofcheating. It is a criminal act

Misrepresentation does not amount to aoffence of cheating. It is not a criminal

act.

Truth

In case of fraud, the aggrieved partycan avoid contract even if it had themeans to discover the truth withordinary diligence

In case of misrepresentation, theaggrieved party cannot avoid the contractif it had means to discover the truth withordinary diligence

DISTINCTION B/W FRAUD & MISREPRESENTATION


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Coercion UndueInfluenceFraud Misrepresentation

Made by either Person to other

Contract becomes Voidable

The party on whom Coercion, Fraud, MisrepresentationUndue influence is made is called aggrieved party


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Aggrieved Party

Has Option

Makes Contract VoidMakes Contract Valid

By terminating theContract

By Keeping silenceBy Using the goodsBy ignoring/ consumingBy lapsing timeBy apprehension of threatBy Resale of goods


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Parties

Consent

Party AFree

Party B Not Free


AggrievedParty


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Parties

Consent

Party AUnFree

Party BFree


AggrievedParty


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Voidable Contract

Depends uponAggrieved PartyAccept Reject

ContractBecomes

Valid

ContractBecomes

Void

Contract isEnforceable

Contract is Not enforceable


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Un free Consent

Due to

CoercionUndue InfluenceFraudMisrepresentations

MISTAKE

Consequence

Consequence

Contract becomesVoidable

No Contract


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Consent

Free

Un Free

Due toCoercionUndue InfluenceFraudMisrepresentation

AggrievedPartyContract IsVoidable

Reject

Accept

ContractBecomes Void

ContractBecomes Valid

See other IngredientsLIPCANS

Due toMistake

Contractis Void


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When a Voidable Contract becomes Valid

After lapseOf reasonable

time

WhenAggrieved Party

Restitution isnot possible

Accepts

Silent

Apprehensive

Goods ResaleGoods ConsumedShape of Goods ChangedGoods theftGoods Broken


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PARTICULARS VOID AGREEMENTS VOIDABLE CONTRACTS

Enforceability A void agreement is un-enforceable by law.

A voidable contract is a validcontract and enforceable tillit is rejected.

Defects A void agreement is void ab-initioand its defects are incurable.

A voidable contract is notvoid ab-initio and its defectsare curable.

Rights of ThirdParty

In a void agreement even a thridparty cannot acquire any right fromperson claiming undr such acontract.

In a voidable contract a thirdparty can acquire a rightfrom a person claimingunder such a contract.

Compensation

In a void agreement the person is

not entitled to compensation froloss arising due to nonperformance of the agreement.

In a voidable contract aperson is entitled tocompensation for lossarising due to non-performance of the contract.

CollateralAgrement

Collateral agreement to voidagreement is a void contract.

A collateral agreement to avoidable contract is not a

void contract.

DISTINCTION B/W VOID AGREEMENT & VOID CONTRACTS


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MISTAKE

Fact Law

PakistaniLaw

ForeignLaw

PrivateRights

QualityQuantity

OwnershipFundament Facts

IdentityExistence Contract is

BindingContract is Void


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Reasons for doing

Business Transactions

Through

CONTRACT

If any party breaches Promise

Other Party goes to Court For gettingJustice


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Relationship

Is Created by

Blood Contract

Brother & Sister

Father & Son

Husband & Wife

Sale / PurchasePartnership Business


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Object of the Contract

Legal Illegal

To buy goods/To acquire service

To buy weapons for killingTo pay a person to defame other person

Contract Valid Illegal Contract


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Right to Sue available to aggrieved party

Available

Criminal Law In Contract

In Tort


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Right to Sue available to aggrieved partyWhen in a contract one party Breaches

In ContractIn Tort

If more benefitThan contract terms

If less benefitIn law of Tort

Aggrieved party asks

As per Law of tort Law

Aggrieved party asks

As per Contract between them


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Contract

Formation

ExpressedConstructive

Quasi

By Conduct

Implied Contract

Oral

Written


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In writing if required by Law

Oral Contract Implied Written

Most of theContract are inOral form

Some of theContract are in

Made byimplication

Important contractAre usually in

Writing but writingform is not necessary

EXCEPT FEW


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By Conduct

Mean

Body LanguageSilently allow otherPerson to enter into

A contract

Here words &Written form are notShared b/w parties


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Contract in written

Mandatory Optional

Purchase of Immovable PropertyCharter Party ContractAgreement for time barred debtAgreement on the basis of love & affection

All contactsmay be made by

words of mouthexcept a fewcontracts


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Contract

Purchases Service RentSales

Amount/ Goods both are immaterial.

Oral WrittenBy Conduct


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Usefulness of Written Contract

DocumentaryProof

No party canEasily deny

Easily preserveFor a longer period

Less disputesAs some disputes arises as one party forgets

Law considers Written evidence more powerful than Oral


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Both parties are able / capableTo act/ meet their part of obligations


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Possible to Perform

Both PartyPerson A Person B

Shall do /act as per contract

At the time of execution of contract


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Patient ABC Doctor XYZ

Able to pay Able to prescribemedicine

Possible to Perform


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Student ABC Teacher XYZ

Able to pay Able to deliverknowledge

Possible to Perform


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Patient ABC Doctor XYZ

Wants to operateHis part of

HEAD

Is a Physician

Possible to Perform

He cant operate because foroperation one must be surgeon


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A benefit which is normally enjoyed by BothParties


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Consideration in a Contract

Bilateral Unilateral NoConsideration

NormalCase

Few CasesAgreement is

Valid

Agreement isVoid


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Consideration need not equal

Seller Buyer

Sale a Book

Price Rs. 20

Buy a Book

Which pass the exam

Here Rs. 20 are nothing but passing of exam is more important


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Consideration need not equal

Seller Buyer

Sale a sugar tablet

Price Rs. 2

Buy a Tablet

Saves life of Diabetic Person

Here Rs. 2 are nothing but saving of life is more important


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Bilateral


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Consideration Bilateral

A benefit enjoyedBy both the

Parties

Price Goods

Seller enjoys Buyers enjoys


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Must be Legal Not Illegal


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Consideration: Legal


Parties

KASBIT Student

Amount Knowledge


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Consideration: Legal not Illegal


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Parties

Seller Buyer

Amount Illegal

Weapons

It is not a contract



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Parties

Seller Buyer

Amount Illegal

Weapons

It is not a contract


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Unilateral Consideration


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Unilateral Consideration

AgreementTimeBarredDebt

PastVoluntarily

Service

Agreement on the basisof Love and Affection

GiftContributionTo Charity


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Agreement to payTIME Barred Debt

Time barred Debt


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Time barred Debt

Pay back Period

Defined Not defined

After expiry of3 years

After expiry of3 years

The lender can not legally recover amount from borrower


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Lending Rs 100 000


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Lending Rs. 100,000

Lending DateMarch 10,2000

Current Date June 2007

Date ExpireOn March 10,2003

Lender can notRecover the

Amount fromBorrower

BorrowerEnjoys the

RightOver fund

Borrower promises to pay back to Lender

Such Contract benefits to only LENDER not the borrower


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Agreement on the basis ofLove & Affection

Agreement on the basis of


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gLove and affection

BetweenParties

Form ofagreement

OtherRequirement

In Writing Registered atRegistrar

At the time ofThis agreement

Relationship of love must be present

All the conditions must be existing


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Agreement to pay forPast Voluntarily Service

Contract for Past Voluntarily Service


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Contract for Past Voluntarily Service

First Party Needs service

2nd Party fulfillthe need voluntarily

First party after gettingBenefits from 2 nd party

2nd party finds andhandover to 1 st party

Now promise toreward

Example:Lost of Passport

This Act/Promise gives benefit to 2 nd party but it will not give anything to 1 st party

Sequence of events


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Sequence of events

At 9.00 pmWallet was

Lost by Javed

At 9.30 pmWallet found

By Imran

At 10.00 pmMr. Imran handoverWallet to Mr. Javed

At 10.30 pmMr. Javed promises

To pay Rs. 300 As reward

Mr. Javed getsThe benefit

Mr. Imran is gettingBenefit but Mr. Javed

Is not getting nay benefit


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Agreement to pay forCharity Contribution

Charity Contribution


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y

Donor(Contributor) Donee

(Receiver of the Funds)

Receiving the FundsLoosingthe Funds


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Unsound Mind

IdiotLunatic

(Over drunken/Suffering illness)

When he is OkThen Contract is Valid

All contracts areVoid

Some timesOK

Some timesSenseless


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Minor Person

Age 18 to below

2222 or moreBelow

18

All contract arevoid

All contracts areValid except

All contracts areValid

Sale/ PurchaseOf Property

Company


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p y

Legal Peron

Makes

BusinessContract

No NaturalContract

Marriage betweenUBL and ABCLSales/ Purchase

Rentals/ Lease/ ServicesJob Contract with employee


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Contract between

Mr. A President

If PresidentBreaches his Promise

Mr. A can not file a suit against him in Court

Useless Contract as no right to go to court against President


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Contract between

Mr. A Insolvent

If InsolventBreaches his Promise

Mr. A can not file a suit against him in Court

Useless Contract as no right to go to court against Insolvent


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Offer & Acceptance


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h ff


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Who can Offer

Owner of theGoods

PersonAuthorized by

The Owner

Such authorizedPerson is

Called Agent


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DirectorsOf the Company

Status of them

Agent of theCompany

The directors makes all contract on behalf of Company

Offer


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Shall not contain

Presumption

ForCommunication& Acceptance

Example of Negative Condition


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Mr. X offers

PresumptionIf YDoes not

Reply within 10 dayIt means he has given

acceptance

Such presumptionIs wrong

No agreementCome into existence

Off t i t


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Offer terminates

By Mr. Ahimself

By CounterOf Mr. B

By LapseOf Time

SubsequentIllegality

Counter offer ofother Party

Offer


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NormalOffer

CounterOffer

First someone offers us

We instead ofacceptance asksome changes

When some body offers to another

RevokesOriginal

Offer

Offer


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By Mr. A

AcceptanceBy Mr. B

AgreementBetween

Mr A & Mr. B

Offer


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By Mr. A

Mr. BRejects

Offer of Mr. A

Is cancelled

By rejection of Mr. B


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OFFER

EXISTS TERMINATES

ACCEPTANCE ACCEPTANCE

Agreement No agreement

Mr. A himself

Cancels it

By lapse of time


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OFFER

EXISTS TERMINATES

ACCEPTANCE ACCEPTANCE

Agreement No agreement


S h t f M B T i t


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OfferBy Mr. A

Mr. B disagreesAnd Makes

Changes

No AgreementBetween

Mr A & Mr. B

Mr.

B accepts

Such act of Mr. B TerminatesAutomatically offer of MR. A

If acceptance is made when offerterminates then NO agreement

Example of Counter/ Cross Offer


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OfferBy Mr. A


Changes

Mr. A may rejectOr accept the

Offer

It is anOffer ofMr. B

Mr. A OffersTo Sell


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His Car

Rs. 200,000 Mr. B says190,000

Offer of Mr. A is Cancelled Now it is an offer of Mr. B

Mr. A says no 195,0000

Offer of BStands cancelledOffer of Mr. A

of 195000 is existing

Mr. A OffersTo Sell


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His Car

Rs. 200,000 Mr. B says190,000

Offer of Mr. A is Cancelled Now it is an offer of Mr. B

Mr. A may accept the Offer&it becomes an agreement

OfferB M A

Birth of New OfferCanceled


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By Mr. A


Changes in Offer

If Mr. AAccepts

The Offer

It is anOffer ofMr. B

There is an AgreementArises between Parties

If Mr. ARejects the

Offer

Mr. B Offers is legally cancel.After rejection

Mr. A if wants, to accept but he didn't

Example ofCross Offers

Mr. AOffers


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Offers

Mr. BChanges

Offer of Mr. B comes into existence

And offer of Mr. A stands cancelled

If Mr. AAccepts offer

Status

Agreement between A & B


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Offer stands cancelled

When otherParty

rejects

When otherParty makes

Counter Offer

Valid Agreements


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AgreementOfferBy A

AcceptanceBy B =

AgainOfferBy A

OfferBy A

RejectionBy B Agreement

+

+ =+ AcceptanceBy B+

Valid Agreements


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AcceptanceBy A

OfferBy A

CounterOffer by B

Agreement+ =+


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Offer in General or Specific


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General Specific

Not to Particular person To specific Person / Entity

Mr. A offers whosoever

Finds my passportI will give reward of Rs. 1000

Purchaseagreements

Offer in General or Specific


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General Specific

Not to Particular person To specific Person / Entity

Mr. A offers if any one gets

Illness having used my pillsI shall pay Rs. 20,000

Sale / PurchaseGift/ Partnership

agreements

Invitation to Offer


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Purpose Goods inWindows/

Advertisement

All displaysitems

InstigateMotivate It is not an offer

But a tool to induce

Results

Other party makes Offer

Words of SellerTo motivate buyer

Invitation to invite Offer


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Not always necessary

Before

Offer


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Mr. Javed offers


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Whosoever finds my NICI will give Rs. 10,000

Wasim search Mr. Javed handovers to Mr. Javed

Mr. Wasim is not entitled for Reward

Mr. Wasim finds it but he did not have any communication of offer

Because Wasim had no communication of Offer

Offer Definite & Clear


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Contains

Ambiguity NoAmbiguity

AcceptanceBy other Party


NoAgreement

Agreementcomes intoexistence



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Mr. A hasTwo Cars

Toyota & Mazda

He offers to

Sell his ToyotaFor Rs. 500,00

Offer is clear

No Ambiguity

Acceptance of BAgreement comes

Into existence



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Mr. A has

Two CarsToyota & Mazda

He offers to

Sell his CarFor Rs. 500,00

Offer is not clearWhich Car

EvenAcceptance of B

No Agreement

Creation of Legal Relationship


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Contains

For SocialPurpose

ForCommercial

Purpose



NoAgreementAnd NO

Agreementcomes intoexistence

Legal RelationshipIs created between

parties

Valid Agreement


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Offer

From Mr. A

Buying an itemFor price

AcceptanceBy Mr. B

AgreementComes into existence

Valid Agreement


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Offer

From Mr. A

InvitingFor Dinner

AcceptanceBy Mr. B

Social InteractionOnly

Terms and ConditionsQuiz Quiz


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Attached

With

AcceptanceWithOffer

Law Allows

Offer remainsValid

Status of acceptanceBecomes Counter Offer

Law does notAllow

QThis offer is

???

QuizThis Accept is

???


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CounterOffer by

Other party

Death/Insanity

Of either party


FailureTo fulfillcondition

REVOCATION/ (Cancellation) OF OFFER

Before Acceptance


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Offer ofMr. A

Mr. BListens

But not giveshis acceptance

Mr. AMay revoke

His Offer

AcceptanceOf Mr. B now

useless

Offer ofMr. A

Mr. A shallnot Revoke

His Offer

Acceptance

Of Mr. B

After the Lapse Of reasonable time


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Offer

Time mentionedFor no specific Time

Even then

If no acceptance isGiven within reasonable time

Offer automatically revoked

After expiryOf mentioned time

Destruction of Subject Matter


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Offer of ATo Sell hisCar to B

Car theftOr

Destroyed

OfferOf

Mr. A

AutomaticallyRevoked

Subsequent Illegality


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Offer of Mr.ATo Sell

Gold to "B"

GovernmentBans to

Sell Gold

Offer OfMr. A


Death / Insanity of Either Party


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Offer of Mr.ATo SellCar to B

DeathOf

Mr. A

Offer OfMr. A



Car to B

DeathOf

Mr. B

Offer OfMr. A


Death/ Insanity of Either Party


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Offer of Mr.ATo SellCar to B

InsanityOf

Mr. A

Offer OfMr. A



Car to B

InsanityOf

Mr. B

Offer OfMr. A


Failure of Condition


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Offer of ATo buy House

Of Mr. B

WithCondition

That allTenants

Must vacantHouse

TenantsDo noVacantHouse

Offer isRevoked

Counter offer by Other Party


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OfferBy Mr. A

Mr. B disagreesAnd Make

Changes

Offer of Mr. AIs Revoked

It is aCounter

Offer

Communication & Revocation


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Offer Acceptance

The offer can be cancelledEven after communication

Acceptance can't be cancelledafter communication

Acceptance & Revocation


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In writtenForm

OralCommunication

Unless it is Readit can be revoked

Impossibleto revoke

(1) Mr. AWrites offer Letter (9) Letter

Received(10) LetterRead by


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(2) SendsOffer Letter

(3) Letter

in Transit

(4) Letter

ReceivedBut not read

(5) Mr. B

reads theLetter

(6) Mr.B

Writes theAcceptance

(7) Put

In letterBox

(8) Letter in

Transit

ReceivedBy Mr. A

yMr. A

Steps


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5-Five 7-Seven 10-Ten

Communicationof Offer

Revocation of OfferIs possible up to

Communication ofAcceptance

Step 2 to 6

At step 7 no revocation of offer is allowedOffer is bound to do what he has offered

Acceptor is Bound

Step 8 and 9


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Step 8 and 9

The Acceptor may

Revoke his acceptance

But at step 10 the Acceptor is bound


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Acceptance


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Unconditional Absolute

B says YES

ValidAcceptanceAgreement


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V lid


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Offer of Mr.A to sell CarRs. 200,000

B says YES

B refuses

B bargains

B disagrees

Valid

AcceptanceAgreement

Offer Cancel

Counter Offer

Who gives acceptance


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The person towhom offer is made

If agent is soAuthorized thenAgent can accept

On behalf ofAcceptor

OfferorMr. A

AcceptorMr. B


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To Mr. DB h

ValidA t


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Offer of Mr. Ato Sell CarRs. 300,000

Brotherof Mr. A

Mr. B givesacceptance

To Mr. A

Valid AcceptanceIt becomes an

Agreement

Acceptance

It becomesan

Agreement

Manner of Acceptance


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OrdinaryManner

PrescribedManner

NormalCase

When OfferorRequiresManner

Offeror mentioned Acceptance shall be by way of Demand Draft

Manner of Acceptance


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OrdinaryManner

PrescribedManner

NormalCase

When OfferorRequiresManner

Offeror mentioned Acceptance has to be at my email address


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Mode of Acceptance

Oral By ConductWritten

Prescribed manner if Offerer has made mandatory

Time Period of acceptance


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Notmentioned Mentioned

NotMentioned

GoodsPerishable Goods NotPerishable After expiryOf mentioned timegiven by offeror

As soon as

possible

After the lapse

Reasonable time

Communication


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Offer

Possible toRevoke before

Acceptance

Acceptance

If communicated;Impossible to

Revoke

Revocation -Acceptance


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WrittenModeOral

Before Offeror readsBefore offeror listens

Relationship


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Blood Legal Fiduciary


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Where fiduciary Relationship


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Exists

Holder of suchrelation

Must disclose of facts essential to the

Contract

Agreement in restraint of Following


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Agreement in restraint of Following

TradeLegal

ProceedingMarriage

Restraints makes Contract Void

But there are certain exceptions whererestraints do not make contract VOID

Agreement in restraint of Trade


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Normally Exceptionally

It is Void

Contract

It is allowed

In special cases


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Restraint although makes contract VoidBut there are exceptions


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Although not allowed but allowed undercertain conditions

Agreement in restraint of Trade


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Exceptionally

It is allowed

In special cases

SellerOf Goodwill

Partnershipagreement TradeCombination ServiceContract

Buyer of Goodwill

Offers with condition that


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Offers with condition that

Seller of Goodwill

Shall restrain from doingSimilar business

Up to aSpecified area

Up to a specifiedTime period

Seller ofThe business

Partnership Agreement


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DuringPartnership AfterRetirement At the timeOf dissolution

Not to do similar business

Within

Specific area

For a particular

Period

Trade Combination


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Cartels

Legal Illegal

OPECMonopoly

S i C t t


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Service Contract

During employment

Employee cannot do other Job

Mr. B is a Engineer


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Working in Khalid Engineering

Job contract mentions

Not to do private practice

Valid

If restriction is afterretirement

If he is allowed todo after leaving job

Void

Mr. B is a Engineer


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Working in Khalid Engineering



Valid



Void

Mr. Abbas is an Advocate


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Working in KASBIT



Valid



Void

Mr. B is a doctor


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Working in Civil Hospital



Valid



Void


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Although not allowed but allowed undercertain conditions


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Restriction on Remarriage


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Even a Person is Married

Muslims Non Muslims

Four Wives Concept Divorce thenRemarriage


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Agreement in restraint of Legal Proceedings


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In case ofdispute

Neither partyWill file an

Select one of theCourts among

other

Both parties may be agreed on the following

Matter shall beReferred to

Appeal to Higher/Superior Court Having equal

authorityArbitrator only


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by Debtor ( A man who has to pay)by Creditor ( A man who has to receive)by Law

Appropriation by Debtor


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When debtorExpress his intention

When debtor does Not express his intention

The creditor must applyAs per direction of Debtor

The law gather the intentionFrom the circumstances

Appropriation by Creditor


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No indicationImplied or expressed

Irrespective of the question

Of limitation

The creditor has optionto settle debt

The creditorCan not applyPayment to

Disputed debt

Appropriation by Debtor


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When debtor No express/ implied intention

When Creditor does not makeAny appropriation

According to law earlier debt is settled,

If two debt has equal due period thenThey are settled proportionately

Loan on Mr. B is Rs. 120,000


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Principal100,000

Interest20,000

Mr. B pays Rs. 15,000

Interest is settled with 15,000

Principal Rs. 100,000; Interest Rs. 5,000


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Importance of Time in a Contract

When Time in the Contract


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Important Not Important

Other party delays Other Party delays

Contract isVoidable

If the delay is

Unreasonable Reasonable thenContract is Vaild

Contract is Voidable

Termination of ContractBIPSOAL


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Breach ImpossibleTo Perform Performance

OperationOf Law Agreement

Lapse ofTime


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BreachActualAnticipatory (Expressed/ Implied)

Remedy for Effected Party against Breach Committed Person


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Suit forSpecific

Performance

Suit forDamages

Suit forInjunction

Order

Suit forQuantumMeriut

Contumacious

Nominal

Ordinary

SpecialExemplary

Not claiming fullBut claiming up tothe job performed

Types of Breach


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Actual Anticipatory


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Actual Breach

Actual Breach


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Execution stageOf Contract

At time time ofContract both

parties are agree

BeforeExecution

of Contract

One partyExpressly decline

Actual Breach


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Happens inBilateral

Executory Contract

Happens inUnilateral

Executory Contract

In Spot ContractTransaction is done by Both side Simultaneously

So no question of Breach

Breach


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ExecutorySPOT

Unilateral Bilateral

Not happen Mostly Happen

Why existence of Breach

Price of PIV


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Computer Rs. 100,000

B sells to A for Rs. 120,000

Market Value Down and PIV isAvailable at price 80,000

A refuses to Buy

Mr. B goes to Court

Breach ofMr. A


Price of P-IV


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Computer Rs. 100,000

B sells to A for Rs. 120,000

Market Value Up and PIV isAvailable at price 140,000

B refuses to Sell

Mr. A goes to Court

Breach ofMr. B


Price of Land


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Rs. 2,000,000

B sells to A for Rs. 2,500,000

Market Value DownAvailable at price 1,800,000

A refuses to Buy

Mr. B goes to Court

Breach ofMr. A


Price of Land


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Rs. 2,000,000

B sells to A for Rs. 2,500,000

Market Value UpAvailable at price 4,000,000

B refuses to Sell

Mr. A goes to Court

Breach ofMr. B


Adnan Sami Promise for


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Concert on November 10, 2007

Contract Sheraton with Adnan Same Rs. 200,000

Meridian Hotel Offers himRs. 300,000

Adnan Sami Refuses to

Sheraton on November 10, 2007

Sheraton goes to Court

Breach ofMr. Adnan

Sami


Adnan Sami Promise for


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Concert on November 10, 2007

Contract Sheraton with Adnan Same Rs. 200,000

Junoon Group approaches toSheraton and agrees for 100,000

Sheraton agrees with Junoon

And Replace Adnan Sami

Adnan Sami goes to Court

Breach ofSheraton

Hotel

If one Party

Actual Breach


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ContractInitiation

TimeContractPerformance

TimeIf one PartyRefuses at this

Stage

Refuses at thisStage

Remedy for Breach of Contract


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Valid Void Voidable

No Remedy as the contractdid not come into

EXISTENCE

Remedy isAvailable

For aggrievedParty

If aggrievedAvoid it then it becomes Void

If aggrieved partyaccepts then contract

becomes valid

Anticipatory Breach


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ContractInitiation

TimeContractPerformance

TimeIf one PartyDoes any thing

At this stage

Consequence: Performance of it becomes doubtful

One party does Not explicitly refuses

Imran KhanSigns contract

Imran KhanSigns contract

Anticipatory Breach


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With CountyABC ($ 200,000)On September 1, 2007

Season : November 1, 2007to December 31,2007

With CountyXYZ ($ 300,000)

On September 20, 2007

Season : November 1, 2007to December 31,2007

How can a person play with two teams at the same time

Aggrieved Party ABC

Remedy for aggrieved Party


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Under Anticipatory Breach

Injunction Order

Anticipatory Breach


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Expressed Implied

Before the execution of contract one party refuse to perform his part of duty

Before the execution of contract one partyDoes not refuse clearly but does an act whichSignifies that he will breach the contract

Remedy for Breach in (Damages)

CNOSEL


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Special Exemplinary

Contumacious Nominal Ordinary

Effected Party Claims forValid Contract not for Voidable or Void Contract

Liquidated


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Price


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At the time of ContractRs.1,000/-

At the time of BreachRs.1,100/-

The Court fines Rs.100/- For Guilty Party to payTo Aggrieved party as Ordinary Damages

Special Damages


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Loss is inIndirect Nature

Should be known / agreedto both parties

Not Naturally ArisesAs a result of Breach

Like in OrdinaryDamages

Court Awards toAggrieved party fromFining to Guilty party

Provided it was decidedBy both parties at theTime of initiation of

contract

Exemplary Damages


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Damages are awarded toPunish guilty party

Beneficiary of DamagesIs aggrieved party

e.g.: When a man refuseTo marry a Lady

e.g.: When a bank dishonorA cheque of a personEven such person has

Sufficient balance

Awarding of suchDamages is not to

Compensate the injuredParty as the loss is not

In the amount

Nominal Damages


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Aggrieved PartySuffered No Loss

The court may awardTo aggrieved party in

Recognition of his right

e.g.: Contract Price &Price at breach date is

Same and goods are

Easily available inOpen market

As there is no loss toAggrieved party the

Court may or may not

Award damages toAggrieved party

Liquidated Damages

If loss is greater than


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Such Damages are agreedB/W the parties at theInitiation of contract

The damages agreedThe damages will beGiven as per agreed

amount

e.g.: Rs.1,000/- wasDecided as damages

Actual loss to aggrievedParty is Rs.2,000/-.

Rs.1,000/- will be paid toAggrieved party

Termination of ContractBIPSOAL


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Breach

ImpossibleTo Perform Performance

OperationOf Law Agreement

Lapse ofTime

Quantum Meruit Remedy For BreachOrdinary DamagesInjunction Order

Specific Performance


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With Mutual AgreementRecessionRemissionNovationExpansionWaiver

Old Contract


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Novation: Cancels Previous Contract

Novation: Creates new Contract

Right of recourse against previous party is lost

Old Contract


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Remission: Cancels Previous Contract

Remission: Creates new ContractIn a smaller size

Old Contract


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Expansion: Cancels Previous Contract

Expansion: Creates newContract in a larger size


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Old Contract


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Waiver : Cancels Previous Contract

No new Contract is created;It extinguishes recourse


256/468

Suit for Quantum Meruit


During Performance

b P tTo get what

h b d


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by one Party

Contract terminates due to

Breach ofOtherParty


DeathOf OtherParty

DestructionOf Subject

Matter

has been done

Here the full amountmay be claimed Amount is claimed upto the amount of work


WhenR ti

WhenC

Appointment

P i


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RemunerationIs not decidedAt the time of

agreement

ContractIs divisible

Process isunauthorized

Worker is

innocent


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Suit for Specific Performance

Aggrieved party

Goes to Co rt


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Goes to Court

The Court Orders

To the Guilty Party to

Act as per Contract

When Specific Performance

GrantDoes not

Grant


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When monetaryCompensation is not

an adequate relief

When actual damageCan not be calculated

When monetaryCompensation isan adequate relief

When actual damageCan be calculated

When Court canSupervise

the actual execution

When Court can Not Supervise

the actual execution


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Suit for Injunction Order

Securing SpecificP f i

Court may orM t

It is aPreventive


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Performance inthe negative form

May notGrant it

PreventiveRelief

When monetaryCompensation is notan adequate relief

It is not the right Of Aggrieved Party to askinjunction Order against guilty Party

Suitable for

Anticipatory Breach


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Termination by Agreement

Both party MutuallyAgreed to cancel the Contract


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Agreed to cancel the Contract

By

Waiving

By

Recession

By

Remission

By

Alteration

By

Novation

Previous Contract Cancel; No new Contract

Previous Contract Canceled; New Contract comes into existence


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By AlterationNew

Contract takes Place


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Novation (Change) in any PartyChanges in the Party terminates

the Old Contract

Contract is made between Parties By offer & Acceptance

Mutually agreed by both of them to bring changes in the Contract


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Changes in the Contract

Parties

OriginallyA & B

SubsequentlyA & C


Novation

Contract between County & Waseem

Waseem request to county for not playing

Contract was canceled


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Contract was canceled

Shoaib Akther agrees to play

If Shoaib

Does not playWaseem is not responsible

It is Novation


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By Remission (Reducing)Old Contract is terminated and

New Contract comes

Contract is made between Parties By offer & Acceptance



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Remission in the Contract

Size of Contract Reduce

Building of 10

Houses

After

Changes

Original

Contract

Building of

4 Houses

Contract -1 Contract -2

Cancelled New Contract


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Subsequent Changes in Law terminatesThe Future Contract

Subsequent Changes in Law

No effect onS Makes effectFuture


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No effect onSpotContract

Makes effectFutureContract

If ban is imposed then thePrevious contract becomes illegal

Illegality always terminates the Contract

Food is allowed in wedding

Future

Topic: Subsequent Illegality


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Mr. A makes a contract with Larosh CateringTo supply Dinner on March 10, 2007

Government Bans food in Wedding on March 1, 2007

The contract between Larosh and Mr. A is terminated

Today : Date is January 10, 2007FutureContract

Mr. A makes a contract with Larosh Catering

Topic: Subsequent IllegalityHere no Ban

So contact is Valid


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Mr. A makes a contract with Larosh CateringTo supply Dinner on March 10, 2007

Government Bans food in

Wedding on March 1, 2007

The contract between Larosh

and Mr. A is terminated

Here law

Changes

Subsequent Changes

In law can maketerminates the contract


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Incapacity: At the time of contract

both parties were competent but athe time of performance one party orboth become incompetent.

Employment Contract between Mr. A & Mr. B

Mr. A makes offer for Partnership to Mr. B


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Mr. B accepts

Now Contact of Partnership between Mr. A & Mr. B

Employment Contractautomatically terminates

OperationOf

Law

Superior contract always terminates the sub-ordinate Contract

Debt Contract between Mr. A & Mr. B

Mr. "B" becomes insolvents


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Contract between them terminatesOperation

OfLaw

Insolvency

Teaching Contract between Mr. A & Mr. B

Teacher Mr. D dies before contract is implemented


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Death terminates future Contract OperationOf

Law

Death terminates future contract

Mr. Sohail purchased goods Rs. 10,000 from Mr. Kaleem

It is a Sales contract between them


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Sohail dies before theContract is implemented

Mr. Kaleem has right to recover amountfrom the property of Mr. Sohail

Mr. Sohail borrowed Rs. 10,000 from Mr. Kaleem

It is a debt contract between them


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Sohail dies


Mr. Sohail agrees to teach Mr. Kaleem

It is a future contract between them


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Sohail dies

Contract terminates;


If Mr. Kaleem has paid then amount shall be returned to him

Mr. Sohail is a Chartered Accountant

Unilever appoints him as auditor


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Audit Contract between Mr. Sohail and Unilever

Due to certain negligence ICAPcancels the certificate of Sohail

Contract between Sohail and Unilver ends

Mr. Sohail is a Politician

He made a job contract with KASBIT


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In lection 2008 he becomes President of Pakistan

The moment he becomes PresidentContract becomes enforceable

If Sohail does breach; Kasbit can not sue him


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Mutual & Concurrent

Reciprocal Promise

Important to Learn


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Mutual &Concurrent

Conditional &Dependent

Mutual &Independent

Where a PartyPrevents

Performance

Mutual & Concurrent

Spot Sales


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p

SellerDelivers

BuyerPays

Executed Contract/ at the same time


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Conditional & Dependent


If the Promisor, who is required to perform hisPromise in the FIRST place, fails to perform


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Promise in the FIRST place, fails to perform

The Promisee is not bound to perform his part of duty

Promisor shall compensate the Promiseeif any loss suffered by Promisee

Promisee is bound only when the Promisor performs first

Party A

Provides Wood


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Provides Wood

Then

Party B makes Furniture Party B is Dependent

Mr. A promise to Deliver 100 bags of Wheat @ 500

Mr. B promise to pay after one month of Delivery


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If Mr. A does not Deliver 100 Bags of Wheat

Price ChangesRs. 550

Price noChange

Mr. A pays to BRs. 50 * 100 qty = 5,000

Ordinary Damages

No CompensationAs Ordinary Damages


Breach Cases


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Promisor Promisee

If First partyPerform & second

party declines

If First partyDoes not perform


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Mutual & Independent

Mutual & Independent

Where one party has to

perform his promise


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INDEPENDENTLY

Without waiting for the performance

At the end of other Party


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Where one party is willing to do as per contract

The other Party prevents


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The party so prevents is guilty Party

Aggrieved party may

Terminate theContract

Ask damagesFrom guilty

Contract- Conditions

D di Simple


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Depending uponFuture UNCERTAIN Condition

SimpleConditions

Possible to Perform

Fulfillment of ConditionsMay or may not be possible Fulfillment of Conditions

May be possible

Example: I will buy your house if you change its Color

(It is possible for Landlord)

Simple Condition in the Offer


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Example: I will buy your House if tenant leaves;The Court decides; Judgment may or

may not in favor of Landlord

Condition in the Offer which is not fully controlled


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Contingent Contracts

have Connected Event/(s)


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Which are Not the Part

OfConsideration

But are thePart of the

Contract

Contingent Contracts

Must haveUncertain event Performance

Eventll l


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Uncertain eventIn Future Of Contract

CollateralTo the Contract

HappeningOf future

Uncertain event

NonHappeningOf future

Uncertain event

Conditions in Offer

EasilyPossible

B h P iDepends uponFuture Uncertain event


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By the Parties Future Uncertain eventWhich may or may

not happen

SimpleContract

ContingentContract

Description Contingent Wagering

Validity Valid Contract Void Contract

Uncertain Uncertain event isUncertain event is theprime sole determing


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Event merely collateral p gfactor

Interest ofParties

the parties have real

interest in theoccurrence or nonoccurrence of the event

the parties have no realinterest in the occurrence

or non occurrence of theevent for winning orloosing the bet

Purpose Beneficial to theParties One Loose one gain.

QUASI CONTRACT

Based on the

Principal of

Contract is

Formed without

Without Offer &

Acceptance


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Equity &Justice

Offer &Acceptance

Law ImposesObligation

of a Contract

QUASI MEANS HALF

BREACH OF A QUASI CONTRACT

As similar remedy asIt is available under


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It is available under Normal contract

BREACH OF A QUASI CONTRACT

Payment by aninterested Person

Supply of Necessaries


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Liability under Mistake

Responsibility ofFinder of Goods

Liability to Pay nonGracious Act

SLLRP

If a person, incapable of entering into a

contract, or any one whom he is legallybound to support, is supplied by another


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bound to support, is supplied by anotherperson with necessaries suited to hiscondition in life ; the person who has

furnished such supplies is entitled to bereimbursed from the property of suchincapable person

The person to whom the necessaries are supplied isincapable of entering into a contract (minor, unsoundmind, insolvent)

The other person has supplied him with necessary suitedto his condition of life


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The other person may or may not be who is legally boundto support

The things supplied must be necessaries not luxuries

Incapable is not personally liable to compensate the otherparty for his support

Property if any, of incapable is liable to compensate theother party for his support

Contract price shall not be charged to compensate;

A person to whom any thing has beendelivered by mistake must return it to theperson who delivered it wrongly.


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A person to whom money has been paid by

mistake must repay to the person whopaid it by mistake.

A person who is interested in the payment

of money, which an other is bound by Lawto pay, and who therefore pays it, is entitled


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to pay, and who therefore pays it, is entitledto be reimbursed by the other.In other words, a person who is interestedin the payment of money, which anotherperson is bound by Law to pay, pays it, isentitled to recover from the other. If he hasnot interest in paying, he cannot claimback.

A person should be interested in payment to

protect his own interest.Such person should not be legally bound to


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Such person should not be legally bound topay.Another person should legally bound to pay.A person should claim the payment fromanother person.

Where a person legally does any thing for

another person not intending to do thatgratuitously the other person enjoys the


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g y p j ybenefit so the another person is bound tocompensate the person who has done a favor.

The person has done or delivered some

thing to other person, the act was notillegal


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The act was legally done.

The intention was not gratuitous, the otherparty enjoys the benefits of his act.

The other party must compensate for theact.

Finder of Goods

Status; Bailee Goods;


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Status; Bailee(Ameen)

Goods;Moveable

Rights & Duties

He must try to find out the real owner of

the goods


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He must not use or consume the goods

He must take care of the goods as hetakes care of his own goods

When the real owner is found, he mustrestore the goods to him

He can retain the goods unless the true owner isfoundHe can ask the expenses of finding the goodsfrom the owner


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from the ownerHe can ask the expenses of preservation of thegoods from the owner.He can refuse to handover goods to the realowner if expenses are not paid the ownerHe is not entitled to sue the real owner forsearching / preservation expenses.

He can sue the real owner if the owner hasdeclared any reward and afterwards he isrefusing to pay.

If the owner declining to pay rewardalthough he had declared the reward thefinder of goods may retained the goodsuntil the owner pays reward to him


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until the owner pays reward to him.

No body in the world can deprivepossession of goods from the finder ofgoods; if any body does the finder ofgoods can file a suit against him.

The finder instead of handing over goodsto the real owner may sell the goods

When the thing is perishable.

When the owner refuse to pay expensesf hi & i f d


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of searching & preservation of goods

If the expenses of searching &preservation of goods are 66.67% ormore of the value of goods

After selling the goods and recoveringthe expenses (searching & preservation)the rest of the amount will be given tothe real owner


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Bailment of Goods

BAILMENT

Lender ofGoods

Receiver / Borrowerof Goods


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Called

Bailor

Called

Bailee

Goods

Corpus Usufruct


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Body of the Goods Benefits of the Goods

CAR Driving/ Sitting

Goods

Ownership Possession


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p

Does not TransferIt remains with the

Possession goes toBailee

Bailor

BAILMENT

Example

Video CassetteOn rentals

Rent a Caror Leasing

ConsignmentSales


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IjaraSales

Clothes/ Pen/ Pencils/ UtensilsBorrowing

Tents/ BicycleOn rent

Rentals are not necessary

Cloth to Tailor / Dry Cleaner/ Goods given to Mechanic

Money Consideration

Bailor Bailee


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Rent a CarLeasing

MechanicTailors

Dry CleanerLockers at bank

Transporters

BAILMENT

Purpose


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To allowOther person

To make/alter/ repairuse goodsand thenReturn

To directOther Person

To sell the

goods

Or


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Types : BAILMENT

Gratuitous Non

Gratuitous


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DefectUnknown to Bailor

Bailor will notCompensateThe bailee

DefectUnknown to Bailor

Bailor willCompensate the

Bailee

BAILMENT

Gratuitous Non

Gratuitous


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Exchange ofGoods

WithoutCommercial

Purpose

Exchange ofGoods

WithCommercial

Purpose

BAILMENT

Gratuitous Non

Gratuitous


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Rent

No rent isPayable by

Bailee

Rent

Rent is payable

By Bailee

Termination of BAILMENT before the Promised time

Gratuitous NonGratuitous


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Possible

But the bailorMust arrangeOther Goods

Not Allowed

As bailor has not doneOn the Charity/ Voluntarily

Friendship basis

BAILMENT

Goods


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Must BeMoveable

Immoveable Not included

House, Bungalow,

Mountains, Buildings

Business & Industrial Law Complete Slides.pptx

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Transcript of Business & Industrial Law Complete Slides.pptx