Assignment

Business and corporative law.

Prepared To: Prof. Umar Zaka Prepared By: The Rocks Group Members: 9212 9234 9215 9243 9265 Naeem Sajjad Pirzada Arslan Sabri M.kashif Naveed ul- Hassan Samman Sharif

Acknowledgement

First of all thanks to Almighty ALLAH Beside that we would like to show our greatest appreciation UMER ZAKA. We cant say thank you enough for your tremendous support and help. We feel motivated and encouraged every time we attend their class. Without their encouragement and guidance this project would not have materialized. Beside that all those peoples who support us during this project we would like to give them bundle of thanks and especially our friends who encourage us to complete this project.

Executive summary

In this project we define the social

agreements and explain five personal family examples. We define and explain the contract and its essentials and explain five personal family example and also we check the essentials in examples that was made our families in past. And in last we wrote the conclusion and recommendations.

Social agreement:
An agreement among the members of an organized society or between the governed and the government defining and limiting the rights and duties of each. This agreement holds the social life and help to fulfill all the society agreements. Theses agreement are not enforceable by law and an individual can't go for sue in the condition of not performing the agreement these agreement are not base on the legal binding Examples of social agreement: my brother Kashif Rasool Gondal proposed a class fellow Nida for marriage and promised that he will marry her but after some time he not fulfill than the Nida can't sue against my brother Kashif Rasool Gondal in court My brother Juniad bet with me if India gave target above275 in cricket match than he will pay me Rs.1000 after match India was not gave target above on 275 than I demands rupees from Juniad but he deny to give me rupees than i have no right to access the court.(not create legal relationship )

My father promised me to give a 125 Honda bike if I get 3.5gpa. And when my result come I get 3.62 GPA in but father didnt give me 125 Honda bike than I have no right sue in any court. My father wallet lost he said to me that if you found my wallet i will give him Rs.500 but when I found his wallet than he said that it was a joke he will not pay the money than me can't sue against him.

My brother said to Ubaid that he will sell his car to him at Rs.300000 but very first morning Ubaid neighbor offer him Rs.350000 Ubaid sold car to his neighbor than My brother has no right to sue against Ubaid..

What is contract?
A contract is an agreement between two or more persons (individuals, businesses, organizations, or government agencies) to do, or to do not some thing. A particular thing in exchange for something of value. Contracts can generally be written using formal or informal terms, or they can be entirely verbal. If one side fails to live up to his/her/it's part of the contract, there's a "breach" of contract and certain remedies for solving the differences are available. The terms of the contract, meaning, the who, what, where, when, and how of the agreement, define the binding promises of each party to the contract. Written contracts must contain the names of both parties, the agreed upon terms, and the parties signatures to be valid. A contract intends to formalize an agreement between two or more parties, in relation to a particular subject. Contracts can cover an extremely broad range of matters, including the sale of goods or real property, the terms of employment or of an independent contractor relationship, the settlement of a dispute, and ownership of intellectual property developed as part of a work for hire. Agreements and contracts are two different things. It is important to know first what constitutes a contract and what constitutes an agreement. We will then study which agreements are contracts, their distinction different types of agreements and contracts.

Essentials Elements of a Valid Contract:

Proposal and Acceptance: When one person signifies to another his willingness to do or abstain from doing anything with a view to obtaining the assent of that other to such act or abstinence he is said to make a proposal. The first step towards creating a contract is that one person shall signify or make a proposal or offer to the other, with a view to obtaining the acceptance of that another person to whom the offer is made. A proposal when accepted becomes a promise. When the person to whom the proposal is made signifies his assent thereof the proposal is said to be accepted. A proposal when accepted becomes a promise. Consideration: When at the desire of the promisor the promise or any other person has done or abstained from doing, or does or abstains from doing or promises to do or to abstain from doing something such act or abstinence or promise is called a consideration for the promise. Every contract consists of two parts - (1) Promise and (2) Consideration for the promise. A promise is often made in return for a promise for example a buyer realizes
5

the goods for the price. Price for goods is therefore, consideration here. Consideration is the cause of the promise. It is the most essential element of the contract. As a general rule, agreement without consideration is void. The promise for a promise in return is consideration. Illustrations: A agrees to sell his house to B for Rest 10,000. Here As promise to sell his house is for Bs consideration to pay Rs 10,000. Similarly Bs promise to pay Rs 10,000 is for As consideration to sell his house to B. An agreement is a contract, only if it is made for a lawful consideration and with a lawful object. Capacity of parties to contract Competent parties: Every person is competent to contract who is of the age of majority according to the law to which he is subject, and who is of sound mind, and is not disqualified from contacting by any law to which he is subject. Free Consent: Parties to a contract must give their consent. The parties must be ad idem, for example both the parties must agree upon the same thing in the same sense. Two or more persons are said to consent when they agree upon the same thing in the same sense. Mere consent is not enough. Consent of parties must be free, for example it must not have been obtained (1) coercion, (2) undue influence, (3) fraud, (4) misrepresentation, or (5) mistake. An agreement must not be expressly declared to be void: A void agreement is not enforceable by law (Sec 2(g)). It has no legal sanctity. It does not give rise to any rights and obligations. Various agreements are expressly declared void under the Act. Writing and registration: Oral contract is a valid contact. However the contract must be in writing and registered, if so required by any law, for example, gift, mortgage, sale, lease under the Transfer of Property Act 1882, Memorandum and Articles of Association of a Company under the Indian Companies Act, contracts under sub sections (10 and 3) of section 25 of the Indian Contract Act, etc. Documents specified under section 17 of the Indian Registration Act, 1908, are required to be registered. No particular form of writing is required to constitute a contract. Intentions of the parties to enter into a particular contract and to give effect to it must be manifest in it, in order to constitute a valid contract.

Legal relationship: Agreements which create legal relations or are capable of creating legal relations are contracts, for example, an invitation to a dinner does not create any legal relation and therefore is not a contract. Certainty: The terms of a contract should be clear. In other words, the contract must not be vague. Contracts which are vague cannot be enforced. Possibility of performance: Contracts based on impossibility of performance are not valid. The contracts must be capable of being performed. Enforceable by Law: A contract in order to be valid must be enforceable by law which element distinguishes agreement and contract. It is enforceable by law it is contract otherwise it is an agreement. The aggrieved party should be able to obtain relief through law in the event of breach of contract. An agreement can also be inferred from correspondence exchanged between the parties.
Examples of the contract

My father ask to faizan to sell his house faizan accept the proposal and wrote agreement on the stamp paper.(in this agreement essential of a valid contract is full filled) My uncle and his friend start the new trade business. They agreement on stampede write the all rules and regulations profit sharing ratio on stamp paper and register the firm on sec registrar office. So this agreement is enforceable by law so the garment was changed in contract. .(in this agreement essential of a valid contract is full filled) My father made an auction who provide the rice mill heavy machinery at on 17 august 2007 I will give tender on that company who provide the heavy machinery on till 17 august 2007 august. Ahsan and co. takes this tender and does agreement on stamp paper. They will provide the machinery on till 17 august 2007. .(in this agreement essential of a valid contract is full filled) My father sends his some peoples of staff to London for hire studies. Before going those staff members wrote the stamp paper they will must work minimum 5 years in Rehman rice mill after when they complete the abroad studies. (in this agreement essential of a valid contract is full filled)
7

Contract of guarantee:
A contract, by which one party promises to save the other from loss caused to him by the conduct of the promise himself, or by the conduct of any other person, is called a "contract of guarantee..."

ESSENTIAL FEATURES OF CONTRACT OF GUARANTEE

1. TRIPARTITE CONTRACT: It is an agreement between the principal debtor, creator and surety. The tree separates contracts exist between them. If the promise principal debtor is not fulfilled, the liability for the surety arises. In a contract of guarantee the principal debtor is liable and the surety will be liable on principal debtors default. The principal contract exists between the principal debtor and the creditor and the contract between the sureties is a secondary contract. 2. CONSIDERATION: A contract guarantee like other contracts must fulfil essentials of a valid contract. It must be supported by some consideration. It is not necessary that there must be direct consideration between the surely and the creditor. The consideration by the principal debtor is sufficient for the surety. (Section 127)

3. MISREPRESENTATION: A guarantee obtained by means of misrepresentation made by the creator or with his knowledge ad assent, concerning a material part of the transaction is in valid. If the consent of surety will be obtained by misrepresentation, the surety is discharged from his liability (section 142). 4. CONCEALMENT: A guarantee which the creditor obtains by means of keeping silence to material circumstances is invalid. The expression keeping silence means intentional concealment of the facts. The creditor should disclose to surety the facts which are likely to affect the suretys liability (Section 143) 5. WRITING NOT NECESSARY: It is not necessary that the contract of guarantee must be in writing. It may Be either oral or written. It may be express of implied from the conduct of parties
8

Examples. My father friend Ali purchase goods from Nadeem on credit bases he has not money to pay in cash form so Ali involves the third person My father he gave the guarantee that if Ali will not pay the amount I take his guarantee I will paid. My uncle ijaz want to take loan from bank but bank need a guarantee of third person. My uncle come to the my 2nd uncle ishtiaq and ask him to give my gurantee.2nd uncle provide the guarantee to the bank that if ijaz not paid amount on time then I will paid . My father wants to do a business of export. But he has not believed on external parties. So he goes in the bank. And bank provides him the guarantee that if the third part not pay liabilities bank will provide the amount. My cousan Amir wants to do job in Mayfair Company and this is company requiremtts that provide the guarantee of any third person.so my father provide the guarantee to the Mayfair Company that if Amir will do in your company any illegal activity. I will responsible.

Conclusion
In this project we gain knowledge how made up and perform the social contracts, legal contracts and agreements and what are the importance of characteristics and essentials of contacts and guarantee of contracts and we also checked through this assignment our families when make the contract they fulfill all the essentials and not.

10

Recommendation
Please avoid on those agreements or contracts that are not create legal relationships. Made up agreements in written form its better than oral form. When you made up contract make sure you fulfil the all essentials of contract.

11