Special contract

contract of indemnity
contract of guarantee
pledge
contract of agency

1. Career Point University Business Law

2. I would like to express my special thanks of gratitude to my teacher ( Pragya Bhargav Ma’am ) who gave me the golden opportunity to do this wonderful project on the topic (Indian Contract act,1872 , special Contract ),which also helped me in doing a lot of Research and I came to know about so many new things I am really thankful to them. Secondly I would also like to thank my parents who helped me a lot in finalizing this project within the limited time frame. Acknowledgement

3. Indian Contract Act,1872 Special Contract

4. CONTRACT OF INDEMINITY CONTRACT OF GUARANTEE PLEDGE CONTRACT OF AGENCY CONTENT:

5. Contract of indemnity : A contract by which one party is promises to another to save him from loss caused to him by the conduct of the promisor himself , or by the conduct of any other person . Sec.124

6. Essential elements of indemnity contract: Two parties. Legal relationship. Free consent. Competence. Consideration. Lawful objective. Express or implied. Compensation of loss .

7. Indemnity h older : who bears loss. Who is promisee. Who receive compensation . Indemnifier : w ho pay compensation for indemnity’s loss. w ho is promisor. Two Parties are:

8. Indemnifier (Promisor) Indemnity holder (Promisee) Contract Compensation paid Contract for compensation

9. Rights of Indemnity Holder: Damages : In this indemnity holder take his compensation for loss. Cost : Sometimes indemnifier refuses to paid compensation. In this situation indemnity holder sue case for compensation. In sued the case the overall expenses incurred is taken by indemnifier also with claim money. Sums : Sometimes indemnity holder may compromise due to damage. In this situation compromisation money also taken from indemnifier. Sec.125

10. Rights of indemnifier: The ICA,1872 is silent for rights of indemnifier. The rights of indemnifier is similar has rights of surety. Right of Sub-rogation : Sub-rogation is a process where rights will get shifted from one person to the other. It means that after compensating indemnity holder for his loss, the indemnifier has right to sue third party who is liable for that. Right to refuse indemnity : Sometimes loss suffered by indemnity holder is beyond the contract, in this case indemnifier has right to refuse for compensation.

11. Contract of Guarantee : A contract of guarantee is a contract to perform the promise, or discharge the liability , of a third person in case of his default.

12. Surety (who gives guarantee) Principal Debtor (for whom guarantee is given) Creditor (To whom guarantee is given) Three parties in contract of guarantee are: Contract C Contract Contract

13. Essential elements of Contract of guarantee: Three parties. Three contract. Express or implied. Legal relationship. Free consent (Sec.13). Competent (not compulsory for principal debtor). Consideration[Sec.2(d)]. Legal objective.

14. Types of contract of guarantee: Unilateral Contract of Commercial Credit (for trade transaction). Bank Guarantee(for contract of tender ). Letter of Credit (for international trade ). Absolute Performance Bonds. Retrospective Guarantee(for existing obligation). Prospective Guarantee(for future obligation). Specific Guarantee(for single transaction). Continuing Guarantee (for more than single debt).

15. RIGHTS OF SURETY: I. Rights against principal debtor: Right to give Notice Rights of Sub-rogation Right of Indemnity Right to get Securities Right to ask for Relief II. Rights against creditor: Right to get Securities Right to ask for Set-off Rights of Sub-rogation Right to advice to Sue Principal Debtor Right to insist on Termination of Services III. Rights against Co-Sureties: Right contribute equally

16. Difference between Contract of Indemnity & Contract of guarantee Contract of Indemnity There is a contract between two parties for compensation of loss. Sec.124&125. Two parties. One contract. It is related with damage. No fixed time period. Contract of Guarantee There are a contracts between three parties for paying liability. Sec.126. Three parties. Three contract. It is related with payment of liability. For fixed time period. Basis Meaning Section No. of parties No. of Contract Related with Time period

17. PLEDGE: This is a special type of bailment contract , in which the bailment of goods as security for payment of a debt or performance of a promise . Sec.172

18. Parties in pledge: Pawnor : The person who pledge the goods as security for payment of debt. This is also called pledger. Pawnee : The person who receives goods as security for payment of goods. This is also called pledgee.

19. Essential elements of pledge: Bailment of security. Goods. Delivery. Delivery under contract. Two parties. Free consent. Legal relationship. Competent. Lawful objective. Consideration.

20. Rights of Pawnee: To retain the goods for subsequent advance. To retain the goods. To receive the extra-ordinary expenses. To sale the goods. To recover the balance.

21. Rights of Pawnor: To get back the goods. To retain the goods. To take care and preserve the goods. To receive increase/profit from the goods. To exercise rights of debtor.

22. Duties of Pledgee(Pawnee): To take care of goods. Not to use the goods for personal use. Not to mix the goods. To return the goods after payment. To return the increase/profit . To give notice before sale of goods. To act in a good faith.

23. To disclose the defects in the goods. To pay the debt ; interest and other expenses at the time specified. To pay extra-ordinary expenses. To pay the balance of debt. Duties of Pawnor :

24. Contract of Agency: An agent as a person employed to do any act for another , or to represent another in dealings with third persons the person for whom such act is done is s called the principal Sec.182

25. Essential elements of Contract of Agency: Name of relation between agent and his principal. Agreement , not necessarily a contract. Competence of the principle. Free consent. Consideration not necessary. Intention to create contractual relations and other essentials.

26. KINDS OF AGENT General Agent. Specific Agent. Co-agent. Broker. Commercial Agent. Auctioneer.

27. Rights of Agent: Right to remuneration. Right of lien. Right of retainer. Right to be indemnified. Right to be compensated.

28. Duties of Agent: Follow instructions of principal. Conduct business with care & skill. Not to make secret profits. Communicate with principal in case of emergency. Not to delegate duties. Avoid conflict of interest. Not to set adverse title. To be liable for misrepresentation or fraud. To compensate for neglect, misconduct etc .

29. Rights of principal: To direct the agent for conduct of business (sec.211). To claim compensation for loss caused him due to agent’s negligence or misconduct (sec. 212). To claim all sums received by the agent on his behalf (sec.217). To empower his agent to employ sub-agent (sec.190). To demand proper accounts of business of agency(sec.213) . To hold the agent liable for unauthorized appointment of sub-agent(sec.193) .

30. Duties of Principal: Towards agent: To pay remuneration to his agent. To indemnify the agent against the consequences of lawful acts. To indemnify the agent in respect of injury caused by his neglect or want of skill. Towards Third party: To be bound by acts of agent acting within the scope of his authority. To be bound by misrepresentation or fraud of his agent in the course of his employment. To be bound by notice given to the agent. To be responsible for contracts entered into by agent through his name is not disclosed.

31. 1. Agency by express agreement. 2. Agency by implied agreement: Agency by estoppel. Agency by holding out. Agency by necessity. 3. Agency by ratification. 4. Agency by operation of law. Types of Agency:

32. Termination of agency: Termination by acts of parties: By mutual agreement. Revocation by principal. Renunciation by agent Termination by operation of law: Completion of agency business. Death of agent/principal. Winding up of company or dissolution of firm. Expiry of time. Insolvency of principal. Principal becomes an alien enemy. Destruction of subject matter. Insanity(Principal or agent becomes of unsound mind).

33. Conditions when agency is not terminated : Agency coupled with interest (sec.202). Authority partially exercised (sec.203). Express contract(sec.205).

34. Presented by: Yamini Kahaliya BBA ( honors)