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Question
Legal Principle: A characteristic feature of partnerships is the principle of mutual agency, i.e., every partner is an agent for every other partner and will hence be able to bind them by his act, within the business of the partnership.
Fact Situation: Ram and Shyam are partners of M/s R & S Trading Company which trades in rice varieties. Ram agrees to purchase ten tons of rice from Govind. Ram dies after the rice is delivered to the premises of M/s R & S Trading Company but before the payment of the price is made. Is the agreement binding on Shyam?
Which of the following statements is the most appropriate in relation to the legal principle stated above?
Options
Being partners, Ram’s agreement to purchase rice for their partnership is not binding on Shyam.
Since Ram is no more, the agreement is not binding on Shyam.
Being partners, Ram’s agreement to purchase rice for their partnership is binding on Shyam.
The agreement is binding on Ram and not on Shyam since the rice is delivered only to M/s R & S Trading Company and not to Shyam.
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Solution
Being partners, Ram’s agreement to purchase rice for their partnership is binding on Shyam.
Explanation:
Every partner is an agent of the firm and his other partners for the purpose of the business of the partnership; and the acts of every partner who does any act for carrying on in the usual way business of the kind carried on by the firm of which he is a member bind the firm and his partners unless the partner so acting has, in fact, no authority to act for the firm in the particular matter, and the person with whom he is dealing either knows that he has no authority or does not know or believe him to be a partner. The above discussion clearly explains that there is a mutual agency between partners acting within the authority for the purpose of the business of the partnership, thus option (3) is the most appropriate statement that is being partnered, Ram's agreement to purchase rice for their partnership is binding on Shyam.
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RELATED QUESTIONS
Apply the legal principles to the facts given below and select the most appropriate answer.
Legal Principles:
1. Consideration is something that moves from the promisee to the promisor, at the implied or express request of the latter, in return for his promise. The item that moves can be a right, interest, profit, loss, responsibility given or suffered, forbearance, or a benefit which is of some value in the eyes of law.
2. An offer may be revoked at any time before the communication of its acceptance is complete as against the proposer, but not afterward.
Factual Situation: The defendant, Mr. Dhawan, wrote to the complainant, Mr. Chaman, with an offer to sell his house to him for Rs. 8,00,000. He promised that he would keep this offer open to him until Friday. However, on a Thursday Mr. Dhawan accepted an offer from a third party and sold his house. According to Mr. Chaman, he was going to accept this offer but had not said anything to Mr. Dhawan because he understood that he had time until Friday. Mr. Dhawan communicated to Mr. Chaman that the offer had been withdrawn, through a friend to the complainant. After hearing this, Mr. Chaman went to find the defendant, informing of his acceptance of the offer. Thereafter, the complainant brought an action for specific performance and breach of contract against the defendant. Whether the defendant's promise to keep the offer open until Friday morning was a binding contract between the parties and whether he was allowed to revoke this offer and sell to a third party?
Apply the legal principles to the facts given below and select the most appropriate answer.
Legal Principles:
1. Consideration is something that moves from the promisee to the promisor, at the implied or express request of the latter, in return for his promise. The item that moves can be a right, interest, profit, loss, responsibility given or suffered, forbearance, or a benefit which is of some value in the eyes of law.
2. An offer may be revoked at any time before the communication of its acceptance is complete as against the proposer, but not afterward.
Factual Situation: MXM Co. is a building contractor who entered into an agreement with Star Heights Housing Association to refurbish a block of 27 flats. This contract was subject to a liquidated damages clause if they did not complete the contract on time. The MXM Co. engaged Hasan to do the carpentry work for an agreed price of Rs. 20,000. After six months of commencing the work, Hasan realized he had priced the job too low and would be unable to complete at the originally agreed price. He approached MXM Co. who recognized that the price was particularly low and was concerned about completing the contract on time. MXM Co. agreed to make additional payments to Hasan in return for his promise to carry out his existing obligations.
MXM Co. agreed to pay Hasan an additional f 575 per flat. Hasan continued work on the flats for a further period of 6 weeks but only received an additional f 5,000. He then ran out of money and refused to continue unless payment was made. MXM Co. engaged another carpenter to complete the contract and refused to pay Hasan any further sums. Hasan sued for payment under the original agreement and the subsequent agreement. MXM Co. argued that the agreement to make additional payments was unenforceable as Hasan has not provided any consideration to make this agreement a valid contract. Decide.
Apply the legal principles to the facts given below and select the most appropriate answer.
Legal Principles:
- Offer is a proposal made by one person to another to do any act or abstain from doing it. The person who makes the offer is known as the promisor or offeror and the person to whom an offer is made is known as the promisee or the offeree.
- A contract comes into being by the acceptance of an offer. When the person to whom the offer is made signifies his consent thereto, the proposal is said to be accepted and the parties are at consensus ad idem regarding the terms of the agreement.
Factual Situation: Tejas drove his car to a car park named Super Car Park (SCP).Outside the car park, the prices were displayed and a notice stated cars were parked at the owner's risk. An automatic ticket vending machine provided a ticket, a barrier was raised and Tejas parked his car. In small print on the ticket, it was stated that the ticket is issued subject to conditions displayed on the premises. On a pillar opposite to the machine was a notice stating the owners would not be liable for any injuries occurring on their premises. Tejas met with an accident and sought damages from SCP. SCP denied any liability on the basis of the exclusion clause which was mentioned in the notice on the pillar. Whether there are an offer and acceptance of the exclusion clause?
The question consists of legal propositions/principles (hereinafter referred to as 'principle') and facts. These principles have to be applied to the given facts to arrive at the most reasonable conclusion. Such principles may or may not be true in the real sense, yet you have to conclusively assume them to be true. In other words, in answering the following question, you must not rely on any principles except the principle that is given hereinbelow for the question. Further, you must not assume any facts other than those stated in the question. The objective of this section is to test your interest in the study of law, research aptitude, and problem-solving ability.
Principle: A pact, other than a pact to commit suicide, to suffer any harm is not an offence, provided the age of the person who has given his consent to suffer harm is above eighteen years.
Facts: A enters into a pact with B, a boy of less than 18 years of age, to fence with each other for amusement. They agreed to suffer any harm which, in the course of such fencing, may be caused without foul play.
Principle: Acceptance (of the offer) must be communicated by the offeree to the offerer so as to give rise to a binding obligation. The expression 'by the offeree to the offerer' includes communication between their authorised agents.
Facts 'X' made an offer to buy Y's property for a stipulated price. 'Y' accepted it and communicated his acceptance to 'Z', a stranger.
Which of the following derivations is correct?
Principle: When a person represents to another something like a true fact knowing well truly that it is not true," he is guilty of fraud. The person subjected to fraud may avoid an agreement.
Factual Situation: A presents a horse for sale. The' horse is kept on display so that anyone interested could examine it. The horse has a cracked hoof and it is cleverly concealed by the owner. B tells "if you do not deny it, I Shall assume that the horse is sound." A keeps silent. B purchases the horse.
Decision
Principle: When a future event on which a contract is dependent is the way in which a person will act at an unspecified time, then the event shall be considered to become impossible when such person does anything which renders it impossible that he should so act within any definite time, or otherwise than under further contingencies. If the event becomes impossible such agreements become void.
Factual Situation: A agrees to pay B a sum of ₹1 if B marries D in A's lifetime. D marries E and soon thereafter. A dies. Whether an agreement between A and B could be enforced if E dies within 1 year of marriage and B marries D?
Consists of legal proposition(s)/ principle(s) (hereinafter referred to as 'principle') and facts. Such principles may or may not be true in the real and legal sense, yet you have to conclusively assume them to be true for the purposes of this Section. In other words, in answering these questions, you must not rely on any principle except the principles that are given herein below for every question.
Further, you must not assume any facts other than those stated in the question. The objective of this section is to test your interest in study of law, research aptitude, and problem-solving ability, even if the 'most reasonable conclusion' arrived at may be absurd or unacceptable for any other reason. It is not the objective of this section to test your knowledge of the law.
Therefore, to answer a question, the principle is to be applied to the given facts and to choose the most appropriate option.
Principle: According to the law of trade unions in India, no suit or other legal proceeding shall be maintainable in any civil court against any registered trade union or any officer or member thereof in respect of any act done in contemplation or in furtherance of a trade dispute.
Facts: Soloman, the Secretary of a registered Trade Union took a loan from a bank for the higher education of his daughter. Soon after completing the course, she was married to an NRI Engineer. Solomon did not repay the loan. The Bank demanded the payments from Soloman and warned him that the Bank will take suitable legal action against him. Identify the legal position in this regard.
Given below is a statement of legal principle followed by a factual situation. Apply the principle to the facts given below and select the most appropriate answer.
Legal Principle: Every partner is liable alone and jointly with other partners for the debts of a partnership firm incurred for the business. Every partner is an agent of every other partner while being a principal in his own right in the business of the partnership.
Fact Situation: Varun is a partner in a firm with Chinmoy and Jaffar. Jaffar purchases a car for his personal purpose and obtains credit for the same in the name of the partnership behind the back of the other partners. He fails to pay the due amount on the expiry of the period of credit.
Which of the following statements is the most appropriate in relation to the legal principle stated above?
Apply the legal principles to the facts given below and select the most appropriate answer.
Legal Principles:
1. A contract comes into being from the acceptance of an offer, When the person to whom the offer is made signifies his assent thereto, the proposal is said to be accepted and the parties are at consensus and idem regarding the terms of the agreement.
2. Consideration is something that moves from the promise to the promisor, at the implied or express request of the latter, in return for his promise. The item that moves can be a right. interest, profit, loss, responsibility given or suffered, forbearance, or a benefit which is of some value in the eyes of law.
3. Contractual rights and liabilities are exclusive to the parties to contract.
4. There are few exceptions to the doctrine of privity of contracts like agency, trust, assignment, and third party beneficiary.
5. A quasi-contract is a contract that is created by the court when no such official contract exists between the parties to prevent a party from being unjustly enriched, or from benefitting from the situation when he/she does not deserve to do so.
Facts: Tanu’s brother, Ishan, tries to talk her into building a greenhouse in her large back-yard. She declines, but lshan is convinced that, if she were surprised by a lovely greenhouse, she would love it. Knowing that Tanu makes good money, and could easily afford the greenhouse, Ishan contacts greenhouse builder Aditya and arranges to have him erect the structure while his sister is at work one day.
Tanu is not happy with her brother’s initiative, but the deed is done. Ishan has directed Aditya to bill his sister for the greenhouse, and that turns out to be the biggest surprise for her. She declines to pay, and Ishan tells Aditya he cannot afford it. Aditya is now out, not only for payment for his many hours of hard work but cash for the materials he used. He files a civil suit to claim against both Tanu and Ishan. Decide.
