Offer and Acceptance
Carlill v. Carbolic Smoke Ball Co. (1893)
Facts: The company advertised that it would pay £100 to anyone who used its smoke ball as
directed and still contracted influenza. Mrs. Carlill used it but still got sick. The company
refused to pay, arguing there was no contract.
Ruling: The court held that this was a valid unilateral contract because the advertisement was
an offer, and Mrs. Carlill’s use of the product was acceptance.
Lalman Shukla v. Gauri Dutt (1913)
Facts: A servant, Lalman Shukla, was sent to find his employer's missing nephew. Later, the
employer announced a reward for finding the boy. Lalman found the boy but was unaware of
the reward at the time.
Ruling: Since Lalman did not have knowledge of the reward when performing the act, there
was no valid acceptance, and he was not entitled to the reward.
Harvey v. Facey (1893)
Facts: Harvey telegraphed Facey asking for the lowest price for a property. Facey replied,
"Lowest price £900." Harvey then accepted, but Facey refused to sell.
Ruling: The court held that Facey’s response was only an invitation to treat, not an offer, and
thus no contract was formed.
. Intention to Create Legal Relations
Balfour v. Balfour (1919)
Facts: A husband promised to send money to his wife while he was away. Later, he stopped
paying, and the wife sued.
Ruling: The court held that this was a domestic agreement with no legal intention, making it
unenforceable.
Merritt v. Merritt (1970)
Facts: A separated husband and wife signed an agreement that the husband would transfer
property to the wife after she paid the mortgage. The husband later refused.
Ruling: The court held that, unlike Balfour v. Balfour, since they were separated, the
agreement was legally binding.
Rose & Frank Co. v. J.R. Crompton & Bros Ltd. (1923)
Facts: The contract included a clause stating that it was not legally binding but only an
"honourable pledge."
Ruling: The court upheld the clause, ruling that parties can explicitly exclude legal
enforceability.
. Consideration
Chinnaya v. Ramayya (1882)
Facts: A woman gifted land to her daughter with the condition that the daughter would pay a
maintenance allowance to her uncle. The daughter refused.
Ruling: The court held that consideration can move from a third party, making the agreement
enforceable.
Currie v. Misa (1875)
Facts: Defined consideration as "some right, interest, profit, or benefit" that one party receives
in exchange for an obligation.
Ruling: It established the classical definition of consideration in contract law.
Kedar Nath v. Gorie Mohammad (1886)
Facts: A contractor agreed to build a town hall relying on public promises of donations. A
donor refused to pay.
Ruling: The court held that the contractor had acted on reliance, making the promise
enforceable.
. Capacity to Contract
Mohori Bibee v. Dharmodas Ghose (1903)
Facts: A minor took a loan and later refused to repay it. The lender sued.
Ruling: The court held that a minor’s contract is void ab initio and cannot be enforced.
Leslie v. Sheill (1914)
Facts: A minor fraudulently misrepresented his age to take a loan and later refused to repay.
Ruling: The court ruled that the contract was void and that a minor cannot be held liable, even
for fraud.
Raghava Chariar v. Srinivasa (1916)
Facts: A person suffering from mental incapacity entered into a contract.
Ruling: The court held that contracts entered into by a mentally incapacitated person are void.
. Free Consent
Raffles v. Wichelhaus (1864)
Facts: A contract was made to ship goods on the "Peerless," but there were two ships of the
same name.
Ruling: The court held that the contract was void due to mutual mistake.
Derry v. Peek (1889)
Facts: A company falsely stated in a prospectus that it had government permission to operate
trams using steam power.
Ruling: The court held that fraud requires intentional deceit, and in this case, there was none.
Kundal Lal Rallia Ram v. Secretary of State (1962)
Facts: A contractor claimed compensation due to government misrepresentation.
Ruling: The court held that misrepresentation must induce a party to enter a contract to be
actionable.
. Legality of Object and Consideration
Gherulal Parakh v. Mahadeodas (1959)
Facts: A wagering agreement was challenged.
Ruling: The court held that wagering agreements are void but not illegal.
Pearce v. Brooks (1866)
Facts: A coach was rented to a prostitute for her business, and she refused to pay.
Ruling: The contract was unenforceable as it involved an immoral purpose.
Surasaibalini v. Phanindra Mohan (1956)
Facts: A contract encouraging a person to get a divorce was challenged.
Ruling: The court held that contracts encouraging divorce are void.
. Performance of Contract
Satyabrata Ghose v. Mugneeram Bangur (1954)
Facts: A contract for land development was delayed due to government orders.
Ruling: The court held that frustration applies when performance becomes impossible.
Krell v. Henry (1903)
Facts: A contract for hiring a room to watch a coronation parade became useless when the
parade was canceled.
Ruling: The court held the contract was frustrated.
Taylor v. Caldwell (1863)
Facts: A contract to rent a music hall was voided when the hall burned down.
Ruling: The court held that impossibility of performance discharges a contract.
. Breach of Contract and Remedies
Hadley v. Baxendale (1854)
Facts: A miller sued a carrier for delay in delivering a machine part.
Ruling: The court established the rule for consequential damages.
Victoria Laundry v. Newman Industries (1949)
Facts: A company sued for lost profits due to late delivery of equipment.
Ruling: The court held that damages must be foreseeable.
F.G. Minter Ltd. v. Welsh Joint Education Committee (1970)
Facts: A contractor sought damages but failed to mitigate losses.
Ruling: The court held that parties must mitigate losses.
. Quasi Contracts
State of West Bengal v. B.K. Mondal (1962)
Facts: Government used a contractor’s work but refused to pay, arguing no formal contract
existed.
Ruling: The court held that the government must pay under quasi-contractual principles.
Soni v. Sundaram (1944)
Facts: Money was paid under mistake of fact, and recovery was sought.
Ruling: The court held that unjust enrichment allows recovery of money paid under mistake.
