Effects: If there is no free consent, Voidability of agreement without free consent: A contract

is voidable at the option of a party whose consent to the contract is obtained by means of coercion,
undue influence, fraud or misrepresentation.
Right to insist on performance in case of affirmation: Where the consent is obtained by fraud or
misrepresentation, the representee is entitled to insist that the contract be performed and that he
shall be put in the position in which he would have been if the representation made had been true.
Exceptions:
1) Means of discovering the truth:
5) Consideration and object unlawful (In part): where the object or consideration of an
agreement is unlawful in part and if it is not separable from the lawful part, the whole
agreement is void.
6) Agreement without Consideration: An agreement made without consideration is void.
Exceptions:
(i) Natural Love and Affection: A written and registered agreement based on natural love
and affection between near relatives is enforceable without consideration.
(ii) Past Voluntary Service: Where a person with the knowledge of the promisor or
otherwise than at his request does some service and the promisor undertakes to
recompense him the promise does not need consideration to support it.
Requirement:
a) The act voluntarily done must have been done for a promisor who was in existence
at the time when the act was done.
b) The act done must have been done for a promisor who is competent to contract at
the time when the act was done.
(iii) Time Barred Debt: A written and sign promise to pay either whole or any part of time
barred debt is enforceable without consideration.
(iv)Remission (Waiver): Every promise may dispense with or remit, wholly or in part, the
performance of the promise made to him, or may extend the time for such performance,
or may accept instead of it any satisfaction which he thinks fit. (Comments pg.32)
(v) Gratuitous Bailment: A bailment of goods made without exchange of any consideration
is a valid contract.
7) Restraint Marriage: Every agreement is restraint of the marriage of any person is void.
Exception: The only exception is in favour of a minor.

8) Restraint of Trade: Every agreement by which any one is restraint from exercising a lawful
profession, trade or business is void.
Exception: When the goodwill of a business is sold, the seller may be restraint from carrying
on a similar business under an agreement. The following condition must be satisfied:
Restriction:
a) The restriction must be reasonable.
b) The restriction should specify the local limits.
c) The restriction should apply only for such period for which the business sold is actually
carried on by the buyer.
d) The restriction should be from carrying on a similar business only.
9) Restraint of Legal Proceeding:
a) An agreement by which a party is restricted absolutely from enforcing his legal rights
arising under a contract by the usual proceedings in the ordinary court is void.
b) An agreement which limits a time period with in which the contractual rights may be
enforced is void.
Exceptions:
Arbitration: A written agreement between the parties to refer a present or future dispute to
arbitration is valid and binding.
10) Uncertain Agreement: An agreement, the terms and conditions of which are not cer5tain or
capable of being made certain, is void.
For example: An agreement to agree in the future is void because there is no certainty
whether the parties will be able to agree.
11) Wagering Agreement: An agreement made by way of wager is void agreement.
Collateral Agreement: All agreement knowingly made to assists the making or carrying out
of any wagering agreement are void.
Exception:
Horse race: An agreement to pay a sum of money to the amount of Rs.500/- or upwards to
the winner of any horse race is valid and binding.
12) Impossible Act: An agreement to do any impossible act is a void agreement.
13) Agreement contingent on impossible event: Contingents agreements to do or not to do
anything, if an impossible event happens, are void, whether the impossibility of the event is
known or not the parties to the agreement at the time when it is made.
14) Alternative promise, one branch being illegal: In the case of an alternative promise, one
branch of which is legal and the other illegal, the legal branch alone can be enforced.
15) Reciprocal Promise (to do things legal, and also other things illegal): Where persons
reciprocally promise, firstly, to do certain things which are legal and, secondly, under

specified circumstances, to do certain other things which are illegal, the first set of promises
is a contract, but the second is a void agreement.
Wagering Agreements:
Definition: An agreement by which two persons professing to hold opposite views touching the
issue of a future uncertain event mutually agree that, dependant on the determination of that
event, one shall win from the other and that other shall pay or hand over to him a um of other
money or stake.
Features of a wagering agreement:
1) Uncertain Event: The performance of the bargain must depend upon the determination or
uncertain event. A wager generally contemplates a future event but it may even relate to an
event which ahs already happened in the part but the party are not aware of its result.
2) Mutual Chances of Gain or Loss: The second essential element is that upon the
determination of the contemplated event, each party should stand to win or loss. If there are
no such mutual chances of gain or loss, there is no wager.
3) Control Over the event: Neither party should have any control over the happening of an
event one way or the other. If one of the parties has the event in his own hands, the
transaction lacks as essential element of a wager.
4) No Interest other that stake: Neither party should have any interest in the happening of the
event other than the sum or stake, he will win or lose.
The doctrine of frustration
(Supervening Impossibility)
When the performance of (a valid and binding) contract becomes impossible or unlawful (which
could no be prevented) due to happening of an event, such a contract becomes void. This is known
as the doctrine of frustration.
Instances of Frustration:
1. Destruction of subject-matter: Performance of a contract becomes impossible by destruction
of the thing essential to that performance and consequently, the contract becomes void.
2. Non-occurrence of an agreed event: If the performance of a contract depends on the
existence of occurrence of a particular state of things which forms the basis of the contract,
such a contract becomes void if the common object (agreed event) is frustrated.
3. Contracts requiring personal performance (Death or disability): A contract for personal
services which is to be performed by the promisor himself becomes void not only on the death

of the promisor but also if (without default on the part of the promisor) he becomes physically
incapable.
4. Subsequent legal changes: Impossibility of performance may arise through subsequent
changes in the law. The parties to contract intent to contract with reference to the law as
existing at the time when the contract is made. The impossibility arises because the changes in
the law is such that it strikes at the basis of the contract.
5. Outbreak of War: An outbreak of war may be a cause of frustration.
Effects of Frustration:
1. Automatic Termination: Frustration terminates a contract automatically and independent of
the volition of the parties at the time of the frustrating event. Supervening impossibility
discharges both the parties from further performance for the future.
2. Restitution (Adjustment of Rights): Where a contract becomes void, the party who has
received any advantage under it is bound to restore it or make compensation for it to the other
party.
Limitation / Restriction of Frustration:
1. Self-Induced Frustration: It is the essence of frustration that the event which causes
frustration must have occurred without the fault of either party. A state of facts brought about
by the act of party cannot be used as an excuse for failure to perform a contractual obligation.
In other words frustration must be genuine, natural, spontaneous and not artificial and manmade.
No discharge despite impossibility:
1. Absolute Obligation: A party who makes an absolute promise accepts the risk of performance
being or becoming impossible.
2. Express provisions in the contract: Frustration is concerned with unforeseen, supervening
events, not events which have been anticipated and provided in the contract itself. The parties
may make full and complete provision for the supervening event foreseen by them, in which
case the doctrine of frustration will have no application.
3. Forseeability: Where by reason of special knowledge, one party foresees the possibility of the
event & conceals this from the other, the party with special knowledge will not be discharged.
4. Portion of work: The doctrine of frustration is also not applicable if only a portion of the
contract becomes impossible or difficult of performance.
Hardship: Hardship occurs where the occurrence of events fundamentally alters the equilibrium
of the contract either because the cost of the disadvantaged party's performance has increased, or

because the value of what it has to receive has decreased provided the events meet the following
requirements:
(i) the events occur or become known to him after the formation of the contract.
(ii) the events could not reasonably have been taken into account at the time of conclusion of the
contract.
(iii)
the events are beyond its control and
(iv)the risk of the events were not assumed by it.
Hardship entitles the disadvantaged party to request the other party to enter into renegotiation of
the original terms of the contract with a view to adopting them to the changed circumstances. Such
party must make a request for renegotiation without undue delay, indicating the grounds on which
the request is sought. Such request does not entitle the disadvantaged party to withhold
performance. The request for renegotiation as well as the conduct of both parties during the
renegotiation process, are subject to the principle of good faith and the duty of co-operation. If the
parties fail to reach agreement on the adaption of the contract to changed either party may resort to
the court. The court may, when this is reasonable order the termination of the contract or adapt the
contract with a view to restore its equilibrium. Invoking the provisions of hardship is relevant to
executory performances and generally in long term contracts.

Contingent / Conditional Contracts:

Definition: A contract the performance of which independent upon the happening or nonhappening of some event collateral to the contract is called a contingent contract.