Evaluation Of The Involvement Of State In Law Of Contracts
The basis of control of the State is particularly unclear, considering the
vast sovereign functions carried out in implementing laws surrounding the vast
umbrella of contract law. The paper makes the case that the state's involvement
in contract law is crucial for ensuring that agreements are upheld,
responsibilities are met and the authoritative figures pertinent to the law are
diligently carrying out those responsibilities.
The State's involvement has been established for several centuries. Though, it
dates back to specific communities such as The Romans and in the religious
pretexts of the middle east. Perhaps the first tenet of international law was
expressed in the Latin phrase Pacta sunt servanda which explains that agreements
must be upheld. No international agreement would be enforceable or binding
without such a regulation.
Many international treaty-governing accords, such as the Vienna Convention,
expressly refer to pacta sunt servanda. This rule is crucial for encouraging
trust and confidence in business dealings since it makes sure that parties can
rely on the promises that have been made to them. Religious precept also quickly
became visible in business and governed contracts and exchanges.
Western Europe saw an economic, political, and intellectual renaissance during
which contract law was revived and developed. These customs started
traditionally influencing the legal fraternity. Statutory law and common law
became the main sources of contract law. The Indian Contract Act, 1872, which
was passed by the British colonial authority in that country, continues to be
the major piece of legislation governing contracts there.
Since its establishment, the statute that establishes the law governing
contracts in India has undergone numerous amendments. The statute was amended as
needed by the Indian government after the country gained independence in
1947.This particular common law bestowed upon the state several authorities to
regulate the domain of contract law and uphold social equilibrium.
How Are These Laws Regulated In Other Nations?
The development and enforcement of contract rules and regulations is one of the
state's major roles in the field of contract law. This includes the creation of
laws and regulations, such as the Uniform Commercial Code (UCC) in the United
States, and upholding these regulations. The federal government regularly enters
into contracts with private companies for goods and services, making it a key
player in the field of contracting.
The Australian contract law section mostly focuses on the common law of
contracts, which can be divided into five categories: contract creation,
contract scope and content, contract avoidance, contract performance and
dissolution, and contractual breach remedy. English contract law is made up of
case law that was decided by English courts after the Judicature Acts, augmented
with statutory reform.
The English government also passed laws that control contract law, such as the
Consumer Rights Act 2015, which governs consumer contracts, and the Sale of
Commodities Act 1979, which regulates contracts for the sale of goods. This
impacted the Indian Contract Act extremely due to hegemony and the English
influence upon most of the laws which were pre existing in the nation.
Establishing The Legal Framework For Contracts
The government creates legislation, rules, and other legal documents that
specify the rights and obligations of parties to contracts in order to establish
the legal foundation for contract law. The legislature, which is in charge of
passing laws that control the creation, interpretation, and enforcement of
contracts, often establishes the legal basis for contract law.
The Board of Trustees of Visakhapatnam Port Trust, Padia Timber Company (P)
Ltd., and Saraswat Trading Agency are examples of companies that have faced
legal challenges in the Indian Contract Act. The Supreme Court has intervened in
the formation of contracts, addressing the issue of contract formulation.
The Indian Contract Act, 1872, provides guidelines for contract interpretation,
performance, and breach, including Sections 37-39 for contract enforcement. In
the case of Saraswat Trading Agency, the Arbitrator was asked to interpret the
contract's provisions, ensuring fairness and legal implications. The government
also provides guidelines for contract termination, including termination by
agreement, breach, and operation of law.
Authority Of The State To Enforce And Agreement
The Indian Contract Act of 1872 and the Specific Relief Act of 1963 govern
contract enforcement in India. The Indian Contract Act addresses fundamental
concepts of contract law, such as penalties for breaches and damages. Section 14
of the Specific Relief Act, 1963, states that intricately detailed contracts,
requiring ongoing fulfillment under third-party supervision, cannot be enforced
by the court.
The state imposes restrictions on contracting individuals and controls the
validation of contracts to ensure parties carry out their duties and avoid
chaos. The Act also provides specific relief in the form of specific performance
of a contract.
The legal system in which the contract was created determines how the government
settles issues involving contract law. In general, though, the government may
settle contract issues through alternate dispute resolution methods or ADR
procedures like arbitration or mediation. In many legal systems, contracting
parties have the legal power to sue one another in court to enforce their
contractual obligations and seek restitution or other relief.
In these situations, the government helps to settle the conflict by offering a
fair venue where the parties can make their cases in front of a judge or jury.
In the Union Of India vs Kishorilal Gupta And Bros, an arbitration clause
was imposed to resolve the dispute.
In some cases, the government may use alternative dispute resolution methods or
alternative dispute resolution procedures. A neutral third party, such as a
retired judge or skilled attorney, will hear the evidence and render a binding
judgment. ADR provides solutions by upholding contractual commitments through
remedies like specific performance, injunctions, or financial compensation.
Protection Of Vulnerable Parties To Contract
The government plays a crucial role in contract law, protecting vulnerable
parties through various legal mechanisms. The Indian Contract Act, 1872,
addresses free consent, invalidating free consent, and providing remedies
against fraud, misrepresentation, or coercion from section 14 through 19.
Governments can mandate the legal capacity of certain parties, such as minors
and those with mental disabilities, to engage in contracts. They may also impose
fiduciary duties on powerful parties to act in the best interests of the
vulnerable party. The government's role in protecting vulnerable parties is
significant, with the methods employed varying depending on the situation and
The government plays a crucial role in contract law, regulating and enforcing
contracts to protect and assert control. This involves statutory protections,
capacity requirements, and rules. State intervention prevents exploitation and
promotes fairness in contractual relationships, maintaining confidence in the
market and facilitating economic transactions. This ensures a consistent legal
framework for all parties involved. The government can strengthen contract law
by increasing authority, reviewing and modifying legislation, and improving
This can be achieved by providing regulatory bodies with more resources, funding
public awareness campaigns, and making legal aid more accessible to low-income
individuals and small businesses. This will promote fairness, economic growth,
and better control over contract law, benefiting all parties involved.
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