I. BALFOUR v. BALFOUR

⮚ Citation: [1919] 2KB 571

⮚ Introduction: Landmark judgement on the intention to create a legal relationship as an essential element of contract.

⮚ Parties: Mr. Balfour & Mrs. Balfour

⮚ Brief facts: Mr. & Mrs. Balfour use to live in Ceylon (now Sri Lanka), a happily married couple. They went on a vacation to England and during their stay Mrs. Balfour was diagnosed with ‘Rheumatic Arthritis’. The doctor advised her proper rest. Her health could deteriorate, with the change in weather, therefore she stayed back in England whereas her husband returned back to Ceylon. As Mr. Balfour promised to send her £30 every month until she stayed back. He regularly made the due monthly allowance as promised but subsequently, stopped sending the amount. Mrs. Balfour sued him for the payment of monthly payments.

⮚ Issue(s): Was there a valid contract between Mr. Balfour & Mrs. Balfour? 

Justice Sargent held that the said contract between the husband & wife was valid and binding as Mr. Balfour was under obligation to support his wife. The prior monthly transfers were enough to form the basis of the contract between Mr. & Mrs. Balfour and the consent of Mrs. Balfour to this arrangement constituted a valid consideration. Mr. Balfour went to the Court of Appeal against the judgment of the Division Bench.

⮚ Decision: The appellate court held that the arrangement between Mrs and Mr Balfour was merely a social agreement and no a contract. a domestic matter and Mr. Balfour had ‘no intention to create a legal obligation’. The court also pointed out that, Though Mr. Balfour made a promise to pay £30 per month and Mrs. Balfour agreed to it but there was no intention to bound by legal consequences on behalf of Mr. Balfour. The Court also held that such types of agreements can’t be a contract because usually in such agreements between the spouse, either of the parties do not intend to bound themselves by legal consequences. Court also made the argument that if the courts will they’ll start to enforce such intimate arrangements made between couples treating them as a legal contract then the courts shall be flooded by with matrimonial disputes.

 

II. LALMAN SHUKLA v. GAURI DUTT

⮚ Citation: 1913 40 ALJ 489 

⮚ Introduction: Acceptance of the offer as an essential element of a valid contract. 

⮚ Parties: Lalman Shukla & Gauri Dutt

⮚ Brief: Gauri Dutt’s nephew went missing. He therefore sent all his servants in search of the absconding child, different places. One of his servants, Lalman Shukla was sent to Haridwar from Cawnpore (Kanpur) to search him, his travelling allowances and other expenses were paid by the master Gauri Dutt. When he returned back to Kanpur after getting succeeded in finding his master’s nephew, he was given two sovereigns along with Rs. 20. During the period while everyone was searching master’s nephew and the plaintiff was also searching him, defendant circulated pamphlets stating that whosoever finds the boy gets a reward of Rs. 501. The plaintiff had no idea about the reward and did not asked for anything further and continued his service for six months. After that, he filed a suit for the recovery of reward from his master, he claimed for Rs. 499 out of the money that was offered in the handbill. Then, the lower court dismissed the plaintiff’s plea.

⮚ Issue(s): 

1. Does the arrangement amounts to a valid contract?

2. Is Mr. Lalman entitled to the reward amount?

3. Decision of the subordinate court was appropriate?

⮚ Decision: Court held that, none of the essential ingredients required to for a for an agreement to be enforceable were not fulfilled in the situation. The primary need for an agreement to be enforceable is the ‘knowledge and assent of the particular offer. Here, he was not aware about the offer and had no assent about the act. Thus, it can be concluded that acceptance is the essence to contract and the plaintiff was just fulfilling his obligation by searching the missing boy.

Also, this is a leading case wherein the important principle of General Offer was laid down. In such case, a contract could be made only with the person who has the knowledge about the offer and accepts it by acting accordingly to fulfil the conditions mentioned in the offer.

 

III. HARVEY v. FACEY

⮚ Citation: 1893 A.C. 552

⮚ Introduction: invitation to an offer is not an offer 

⮚ Parties: Facey & Harvey 

⮚ Brief facts: Mr. Facey was a real estate owner who was interested to sell his property which was in Jamaica. Harvey who was interested in buying that property sent a telegraph asking he would sell his property to Harvey on lowest cash price to be paid. Replying to his telegraph Facey replied to his second question only. Facey’s telegraph read, lowest price for Bumper Hall Pen is £900. To which Harvey later replied, he agreed to buy Bumper Hall Pen which was asked for and he also asked Facey to send him property deed so that he could get early possession. Facey denied to sell his property to Harvey at that price. Later, Harvey filed a case in the court of appeal, Harvey won the case. Facey who was unhappy appealed against the decision and case went to Privy Council which upheld the trial court’s decision.

⮚ Issue(s): Was there any offer from Facey to sell the property for £900?

⮚ Decision: It was held by the Privy Council that; it would be a contract only if Facey had replied to Harvey’s third telegraph. Harvey took Facey’s response to his question as an offer to sell at the named price by him. There was no commitment to sell the property because the offer which was made by the Harvey by replying to the invitation of an offer was not accepted. Thus, there was no contract between the two. 

IV. MOHORI BIBEE v. DHARMODAS GHOSE 

⮚ Citation: 1903 30 Cal 539

⮚ Introduction: competency or Ccapacity of the parties to contract / Minor’s contract

⮚ Parties involved: Dharmodas Ghose & Mohori Bibee

⮚ Brief facts: Plaintiff, Dharmodas Ghose was in need of money therefore, he pledged his property and asked for loan of Rs. 20,000 from the moneylender Brahmo Dutt. The debt amount given was less than Rs. 20,000. Brahmo Dutt who was acting as attorney at that time on the behalf of the moneylender, knew that Dharmodas Ghose was a minor. Plaintiff filed a suit against Brahmo Dutt stating that the mortgage deed should be null and void because he was a minor at the time of contract and hence, it should be cancelled. Later, Brahmo Dutt passed away and the appeal was prosecuted by his executors. And it was contended by the defendant that plaintiff should not be excused as he misrepresented his age to him. Even if the deed is void, the debt that was advanced to him i.e., Rs. 10,500 should be repaid.

⮚ Issue(s): 

1. Was the mortgage deed void?

2. Deed signed by defendant was voidable or not?

3.Was the defendant entitled liable to receive the mortgage money?

⮚ Decision: The Privy Council held that the; person who mortgaged the property was infant at the time of execution. So, the contract or mortgage deed which was made between the plaintiff and the defendant was not merely voidable but it was void. It also held that any contract with a minor or an infant is ‘void ab-initio’. Since minors are incompetent to contract hence, such contracts are void and invalid in the eyes of law. The minor is not obliged to pay back the amount that was advanced to him as he was not bound by the promise that was executed in contract.

Minor is a person who has not attained or is below the age of 18 years.

And any contract entered into with a minor shall be be null and void (void ab initio) owing to his incapacity. Dealings done by the minors without the knowledge and consent of their custodians or parents shall not be liable to them. 

V. RAFFELS v. WICHELHAUS

⮚ Citation: 2 H. & C. 906

⮚ Introduction: consensus ad idem- “meeting of minds”

⮚ Parties: Raffels & Wichelhaus

⮚ Brief facts: Mr. Raffels and Mr. Whichelhaus had a contract that Mr. Raffels would send him 125 bales of Surat cotton via a ship named peerless from Bombay. But there were two ships with the name peerless. The same name of two different ships mislead them and they agreed upon two different ships in their minds, which means there was no meeting of mind while binding the contract. When the ship containing cotton reached Liverpool in December, Wichelhaus refused to receive the shipment and to pay for it. In his understanding the consignment was late as he mis- understood that the ship earmarked with nomenclature as some other which was supposed to reach in the month of October. Both of them had mis-understanding in reference to ship names. Later, due to this delay according the defendant who did not received the order was sued for the breach of contract by the plaintiff (Raffels).

⮚ Issue(s): Was there an enforceable contract between the parties? 

⮚ Decision: The court held that the contract was vague and hence, it was not an enforceable contract. For binding of a contract, there should be meeting of minds between the parties.In this case, there was no consensus ad-idem. At the time they had entered into this contract, there was ambiguity on the issue as to which ship shall carry the cotton to be delivered. Since, it was a well-documented deed and not a fraud and hence, it should not be interrupted by extrinsic evidence.


This case briefs has been prepared by Ms. Urvi Yadav, who was an intern at MyLawman & edited by Ms. Samreen Ahmed, Research Assistant, ARIL, MyLawman.