BCOC-133 BUSINESS LAW CHAPTER-8 REMEDIES FOR BREACH AND QUASI CONTRACT

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BCOC-133 BUSINESS LAW
CHAPTER-8 REMEDIES FOR BREACH AND QUASI CONTRACT

MEANING OF BREACH OF CONTRACT:
Breach of contract occurs when one party fails to fulfill its obligations as agreed upon in a contract.it involves a violation of terms of conditions specified in the contract, leading to a legal dispute between the parties involved

ACTUAL BREACH OF CONTRACT:
Actual breach of contract can occur in two ways

1. Breach at the time of performance due:-

  • If a party refuses or fail to perform their part of the contract at the agreed-upon time, it constitutes an actual breach

  • The injured party may have the option to accept the breach or refuse performance, depending on whether time was considered essential to the contract, as per section 55 of Indian contract Act

    2. Breach during performance of the contract:

    • If one party fails or refuses to fulfill their contractual obligations while

      the contract is ongoing, it constitute an actual breach during the

      performance of the contract

    • For instance, a supplier who agreed to deliver goods in instalments

      stops delivery after a few instalments

      REMEDIES FOR BREACH OF CONTRACT :

      When a contract is breached, there are various remedies available to the aggrieved party:

      1. Rescission of the contract:

  • Asper section 39 of the Indian Contract Act, if a party refuses to perform or disables themselves from ful3illing the promise entirely, the other party may put an end to the contract. This is known as the right of rescission

  • The aggrieved party is then discharged from all obligations under the contract

    2. Suit for damages :

    • The injured party can sue for damages, seeking monetary

      compensation for loss or harm suffered due to the breach

    • Damages can include ordinary damages(arising naturally from the

      breach) and special damages (know at the time of contract making to

      be likely result of the breach 3. Suit for specific performance:

  • In case where monetary compensation is not sufficient, the court may order the default party to ful3ill the promise according to the terms of contract

  • This is particularly applicable in contracts involving unique items or real estate

4. Suit for injection:
• If a party breaches a negative term (doing something promised not to

do), the court may issue an injection, prohibiting that party from the

specific action

5. Suit upon Quantum Meruit:

• This allows a party who has partially performed the contract to claim payment for the work done if the other party repudiates the contract or if an event makes further performance impossible

These remedies provides legal avenues for resolving disputes and compensating the aggrieved party in case of breach of contract

QUASI CONTRACT

Quasi contract also known as implied contracts, arise when the law imposes an obligation in the absence of formal agreement. It occurs when one party has received a bene3it that, in equity and conscience, they should not retain

DIFFERENCE BETWEEN QUASI CONTRACTS AND CONTRACTS:

• Contracts: obligations rise from the consent of parties
• Quasi contract: obligations are imposed by law or natural equity, not

based on consent
• Similarity: both may lead to claims for damages in case of breach

TYPES OF QUASI CONTRACT:

  1. Supply of necessaries(section 68):

    • Application when a person incapable of contracting is supplied with necessaries

    • Claimable only from the property of incapable person

    • Necessaries must be suited to the person’s condition

  2. Payment of money due by another (section69):

    • A person paying money due by another is entitled to reimbursement

    • Essentials: payment by interested party, non-voluntary payment and

      legal obligation to pay

  3. Obligation to pay for non-gratuitous Act(section70):

    • Applies when a person lawfully does something for another, not intending it to be gratuitous

    • Conditions: lawful act, no gratuitous intent, and bene3it enjoyed by other party

  4. Responsibility of finder of goods:

    • A finder is bailee must take care of the goods

    • Rights include retention against the whole world( except the true

      owner) and a lien for due expenses

  5. Liability of person to whom money is paid or thing delivery by mistake or under coercion(section 72):

    • A person must repay or return money or things received by mistake or coercion

    • Based on the principle of equitable restitution

QUANTUM MERUIT:
Quantum meruit, meaning “as much as earned”, allows compensation for work done

under certain circumstances CASES OF QUANTUM MERUIT:

1. When a contract is unenforceable:

• If an agreement becomes void, the party receiving an advantage must restore it or compensate

2. Abandonment or refusal to perform the contract:

• Breach of contract allows the aggrieved party to claim reasonable compensation for work done

3. Divisible contract with benefit enjoyed:
• In a divisible contract, if the party not in default enjoys the bene3it,

the defaulting party can sue on quantum meruit

4. Indivisible contract badly performed:

• If an indivisible contract is poorly performed , the performing party can claim the lump sum less deductions for bad work

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