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Question
Principle: The communication of a proposal is complete when it comes to the knowledge of the person to whom it is made.
Facts: 'A‘ sent a letter making a proposal to 'B‘ to purchase the house of B.
Options
The communication of the proposal is complete when A sent the letter.
The communication of the proposal is complete when B‘s wife received it.
The communication of the proposal is complete when B‘s wife handed over the letter to B.
The communication of the proposal is complete when B reads the letter.
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Solution 1
The communication of the proposal is complete when B reads the letter.
Explanation:
According to Section 4 of the Indian Contract Act, The communication of a proposal is complete when it comes to the knowledge of the person to whom it is made. The communication of an acceptance is complete.
As against the proposer, when it is put in a course of transmission to him so as to be out of the power of the acceptor;
As against the acceptor, when it comes to the knowledge of the proposer. The reasonable conclusion is that in the present problem that the communication of the proposal is complete when B reads the letter is the correct answer.
Solution 2
The communication of the proposal is complete when B reads the letter.
Explanation:
The communication of the proposal is complete only when B reads the paper. This is evident from the principle which states “The communication of a proposal is complete when it comes to the knowledge of the person to whom it is made.” It means only after B reads the letter, it comes to his knowledge.
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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: Nandini, by deed of gift, made over the certain landed property to Reena, her daughter. By the terms of the deed, which was registered, it was stipulated that an annuity of ₹ 3,000 should be paid every year to Subhashini, sister of Nandini. Reena executed in Subhashini’s favour an agreement promising to give effect to stipulation. The annuity was, however, not paid and Subhashini sued to recover it. Reena is defending herself by claiming that there is no valid contract with Subhashini. Which of the following can be ground/s for the court’s decision?
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II Only a person who is a party to a contract may demand the execution of that contract from other parties. But if there is a third-party beneficiary to the contract then it is enforced to the extent of his\her benefit.
III. The agreement is valid as both Reena and Subhashini agreed to it on the same thing in the same sense.
IV. There is no privity of contract as Subhashini has furnished no consideration. Reena had promised to Subhashini but consideration was furnished by Nandini.
