Question 1 (a)
True or false: transactions collateral to illegal agreements; restraint of legal proceedings; contingent contracts
9 marks
- Time to write
- About 18 minutes
From an older CBCS paper
Question
Question 1 (a) · 9 marksGiving brief reasons, State whether each statement below is True or False:
Transactions collateral to an illegal agreements do not become void.
An Agreement in restraint of legal proceedings is valid.
Contracts that are contingent are void.
Reworded from the university paper; the task is the same. The original paper belongs to the University of Delhi. See DU's question bank.
Before you write
Read off the question and its marks
Read from the question
- State whether…A verdict for each (True or False), then the reason that decides it.
Write it in this order
The parts stand alone: start with the one you are surest of.
- Read each statement; find the word that decides it 1 min
- 1 (i) Collateral transactions 3 marks 5 min
- 2 (ii) Section 28 3 marks 5 min
- 3 (iii) Contingent contracts 3 marks 5 min
- Check: a verdict and a reason for every statement 2 min
Short on time? A few lines on every part beat a full answer to one: each part is capped at its own marks.
Try it first. About 18 minutes for 9 marks. Write it out, then open the solution.
Solution
Hover or tap a marked figure, like 72,000, to see how it is made and where else it appears.
(i)False An illegal agreement is one the law forbids, and the court will not enforce it or the contracts connected with it; all illegal agreements are void, though all void agreements are not necessarily illegal. Transactions collateral to an illegal agreement are therefore also void. (It is transactions collateral to a merely void agreement that are not affected.)
(ii)False Under section 28 of the Indian Contract Act, 1872, every agreement by which a party is restricted absolutely from enforcing his rights under a “contract by the usual legal proceedings in the ordinary tribunals, or which limits the time within which he may” enforce them, or which extinguishes his rights on the expiry of a specified period, is void to that extent. The exceptions are agreements to refer disputes, future or existing, to arbitration.
(iii)False A contingent contract is valid. A contract of insurance, for example, is a type of contingent contract and is valid in law; it differs from a wagering agreement, which is void. A contingent contract becomes enforceable when the collateral event on which it depends happens (or does not happen, as the case may be).
Where the 9 marks sit
| # | Component | Marks |
|---|---|---|
| 1 | (i) Collateral transactions | 3 |
| 2 | (ii) Section 28 | 3 |
| 3 | (iii) Contingent contracts | 3 |
| Total | 9 |
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