Essentials of proposals and revocation
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This document discusses the essentials of proposals and revocation in contract law. It defines a proposal or offer as signifying a willingness to do or abstain from doing something. A proposal must have clear terms, be communicated, intend to create legal relations, and be possible to accept. A proposal can be revoked through notice, lapse of time, death or insanity of the offeror, counteroffer from the offeree, or subsequent illegality. Revocation refers to canceling or annulling something by authority, such as withdrawing an offer before acceptance.
Essentials of proposals and revocation
- 1. TOPIC : ESSENTIALS OF PROPOSAL AND REVOCATION
- 2. DEFINATION OF LAW According to salmon ( Recognized by the father of business law) : Law is the body of principles recognized and applied by the state for providing justice. According to Green : Law is the system of rights and obligations which are enforced by the state.
- 3. PURPOSE OF LAW To maintain peace and order in a society Provide liberty to people To assist people and their property Not for the punishment of sins but for the prevention of the sins. Prevent people and their property
- 4. CONTRACT “An agreement that is enforceable by law” is known as contract according to contract act 1872. Contract = Agreement + Enforceability
- 5. AGREEMENT The promise or set of promises that are forming some consideration is known as agreement according to contract act 1872. Agreement = Promise + Consideration
- 6. THE PROPOSAL OR OFFER PROPOSAL OR OFFER : Proposal and offer both are used in the same sense and there is no difference in their meanings. It is defined in the following words : "When one person signifies to another his willingness to do or to abstain from doing anything.”
- 7. OFFERER AND OFFEREE OFFERER : The person who makes the proposal is called proposer offerer or promisor. OFFEREE: The person to whom offer is made is called offeree or promisee. Note :- There will be no agreement, if the proposal is made without the intention of creating legal rights and obligations.
- 8. KINDS OF PROPOSAL 1. General Proposal :- When proposal is made with the entire world it is called general proposal. But contract is made only with the person who performs the conditions of the proposal. 2. Specified Proposal :- It is made to specific person or specific class. It is also accepted by specific person.
- 9. KINDS OF PROPOSAL 3. Express Proposal :- When the proposal is expressed in words or in writing it is called express proposal. 4. Implied Proposal :- When the proposal is conveyed by the contract of the offerer, it is called implied proposal.
- 10. ESSENTIAL OF VALID PROPOSAL Following are the important conditions : 1. Legal Relationship :- It is essential for a valid proposal that it must be made with the intention of creating legal relationship otherwise it will be only invitation. A social invitation may not create legal relationship. Example :- Mr. Arman invites Mr. Shahid t dinner and he accepts. It does not create any legal relations.
- 11. ESSENTIAL OF VALID PROPOSAL 2. Clear Terms and Conditions :- Proposal should be certain clear, understandable and simple. It may not create any confusion in the mind of proposee should be precised and definite. Example :- Mr. Agha offers to sell his house to Mr. Salman for Rs. 10 lac He agrees. It is a contract and create legal relationship.
- 12. ESSENTIAL OF VALID PROPOSAL 3. General and Specific Offer :- When proposal is opened to the general public it is called general proposal on the other hand when it is made to the specific person, it is called specific offer. In case of general proposal contract is made with person who accepts the offer.
- 13. ESSENTIAL OF VALID PROPOSAL 4. Must be Communicated :- It is also an important rule for the validity of proposal. Without communication acceptance of proposal by the proposee is not possible. How an offer can be accepted unless it has been bought to the knowledge of a person to whom it is made.
- 14. ESSENTIAL OF VALID PROPOSAL 5. Assent Must be an Object :- Proposal without object will not be valid. The object of the proposal must be to get the assent of the other party to whom the offer has been made. 6. Distinction Between Proposal and Invitation :- Proposal is different than the invitation of tenders. Price list of goods and quotation. These are only invitation of an offer and not the proposal.
- 15. ESSENTIAL OF VALID PROPOSAL 7. Communication Method :- There are three methods of communication proposal can be made orally, in writing or by conduct. Generally proposals are made orally or writing. 8. Acceptable Proposal :- If the acceptance of the proposal is not possible then it will be not a valid proposal. It is essential that acceptance must be possible.
- 16. REVOCATION Revocation refers to the cancelling or annulment of something by some authority. When revocation happens, a privilege, title, or status is removed from someone. If the library revokes your library card, you can no longer take out library books — that's a type of revocation. If a restaurant is dirty, that could result in the revocation of its health license. If a lawyer breaks the law, it could lead to the revocation of his license to practice law.
- 17. REVOCATION 1) mutual cancellation of a contract by the parties to it. 2) withdrawing an offer before it is accepted. ("I revoke my offer"). 3) cancelling a document before it has come into legal effect or been acted upon, as revoking a will. 4) to recall a power or authority previously given as cancelling a power of attorney or cancelling a driver's license due to traffic offenses.
- 18. MODES OF REVOCATION OF PROPOSAL 1. By notice of revocation. Offer may be revoked by a communication of a notice of revocation by the offeree to the other party before acceptance is complete against the offeror himself. An offer made in writing may be revoked by words of mouth. The notice of revocation may not always be express. A notice of revocation to be effective must be communicated to the offeree.
- 19. MODES OF REVOCATION OF PROPOSAL 2. By lapse of time. A proposal will come to an end by the lapse of time prescribed in such proposal for its acceptance or, if no time is so prescribed by the lapse of time of reasonable time is a question of fact depending upon the circumstances of each case. Where the subject matter of the contract is an article, like gold, the parties of which fluctuate daily in the market, very short period will be regarded as reasonable made late in november.
- 20. MODES OF REVOCATION OF PROPOSAL 3. By death or insanity. A proposal is revoked by the death or insanity of the proposer if the fact of his death or insanity comes to the knowledge of the acceptor before acceptance. 4. By counter offer. An offer comes to end when the offeree makes a counter offer or rejects the offer. Where an offer is accepted with some modification in the terms of the offer or with some other condition not forming part of the offer, such qualified acceptance amount to a counter offer.
- 21. MODES OF REVOCATION OF PROPOSAL 5. By subsequent illegality. An offer lapses if it become illegal after it is made and before it is accepted. Thus, where an offer is made to sell 10 bags of wheat for Rs. 2500 and before it is accepted, a law prohibiting the sale of wheat by private individual is entered, the offer comes to end.